RAMELIUS RESOURCES LIMITED
ANNUAL REPORT
2017
CONTENTS
Chairman’s Report
Managing Director’s Report
Review of Operations
Glossary of Terms
Native Title Statement
Sustainability Statement
Diversity Statement
Corporate Governance Statement
Annual Financial Report
- Directors’ Report
- Auditor’s Independence Declaration
Income Statement
-
- Statement of Comprehensive Income
- Balance Sheet
- Statement of Changes in Equity
- Statement of Cash Flows
- Notes to the Financial Statements
- Directors’ Declaration
-
Independent Auditor’s Report
Shareholder Information
Corporate Directory
1
7
8
33
38
39
41
42
43
44
63
64
65
66
67
68
69
107
108
113
(Back Cover)
RAMELIUS RESOURCES LIMITED
ACN 001 717 540
ABN 51 001 717 540
ANNUAL GENERAL MEETING
The Annual General Meeting of
Ramelius Resources Limited will be held at
Pullman Adelaide,
16 Hindmarsh Square
Adelaide 5000 SA,
on Thursday 30 November 2017
at 11.00 am Adelaide time.
STOCK EXCHANGE
The Company is listed
on the Australian Securities
Exchange Limited.
ASX CODE
Shares: RMS
Front Cover: Mt Magnet Operations below the Milky Way
Photograph courtesy Ian Beattie, Paramedic – Mt Magnet
CHAIRMAN’S REPORT
RAMELIUS RESOURCES LIMITED
CHAIRMAN’S REPORT – 2017
Dear fellow shareholders,
Dear fellow shareholders,
On behalf of the Board of Directors, I present to you the 2017 Annual Report of Ramelius Resources
On behalf of the Board of Directors, I present to you the 2017 Annual Report of Ramelius Resources Limited.
Limited.
I am pleased to report that on the back of improved performance from the Company’s Western Australian gold
I am pleased to report that on the back of improved performance from the Company’s Western Australian
operations, Ramelius achieved a third consecutive annual profi t. For the year ended 30 June 2017, profi t before
gold operations, Ramelius achieved a third consecutive annual profit. For the year ended 30 June 2017,
tax was $25.1 million which was down slightly on the previous year result of $25.3 million. Profi t after tax was
profit before tax was $25.1 million which was down slightly on the previous year result of $25.3 million.
$17.7 million compared to $27.5 million in 2016. Sales revenue for the 2017 fi nancial year increased from $173.7
Profit after tax was $17.7 million compared to $27.7 million in 2016. Sales revenue for the 2017 financial
million to $197.4 million. Cash fl ows from operating activities increased from $65.5 million to $83.4 million, total
year increased from $173.7 million to $197.4 million. Cash flows from operating activities increased from
net assets increased from $127.6 million to $169.8 million and cash at bank increased from $44.3 million to $78.6
$65.5 million to $83.4 million, total net assets increased from $127.6 million to $169.8 million and cash
million.
at bank increased from $44.3 million to $78.6 million.
The Company’s share price at 30 June 2017 was 45 cents having risen to a high of 74.5 cents in February 2017
The Company’s share price at 30 June 2017 was 45 cents having risen to a high of 74.5 cents in February
compared to 43.5 cents at the end of the previous fi nancial year.
2017 compared to 43.5 cents at the end of the previous financial year.
The Australian gold price commenced the 2016/17 fi nancial year at A$1,773 per ounce, rose to a high of A$1,821
The Australian gold price commenced the 2016/17 financial year at A$1,773 per ounce, rose to a high of
A$1,821 per ounce in early July 2016 and remained above A$1,700 per ounce for the whole of the first
per ounce in early July 2016 and remained above A$1,700 per ounce for the whole of the fi rst quarter. Despite the
quarter. Despite the good start to 2016/17, the price of gold fell to a low of A$1,531 per ounce in mid-
good start to 2016/17, the price of gold fell to a low of A$1,531 per ounce in mid-December 2016 and then
December 2016 and then remained above that level for the rest of the reporting period, generally trading
remained above that level for the rest of the reporting period, generally trading in the A$1,600 to A$1,700 per
in the A$1,600 to A$1,700 per ounce range and only exceeded A$1,700 per ounce for short periods on
ounce range and only exceeded A$1,700 per ounce for short periods on several occasions during the last quarter
several occasions during the last quarter of the financial year. The gold price at 30 June 2017 closed at
of the fi nancial year. The gold price at 30 June 2017 closed at A$1,616 per ounce.
A$1,616 per ounce.
Australian dollar gold price (Source Gold Price .Org)
Operationally, your Company continued mining at Mt Magnet and near Leinster in Western Australia. At
the Galaxy mine area located at Mt Magnet, Ramelius continued cut-back mining of the Titan and
Operationally, your Company continued mining at Mt Magnet and near Leinster in Western Australia. At the
Perseverance open pits with the latter being completed in February 2017. By year end, Titan had
Galaxy mine area located at Mt Magnet, Ramelius continued cut-back mining of the Titan and Perseverance open
progressed close to the base of the pit where higher grade ore was being accessed.
pits with the latter being completed in February 2017. By year end, Titan had progressed close to the base of the
pit where higher grade ore was being accessed.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 1
“AT THE GALAXY MINE
AREA LOCATED AT
MT MAGNET, RAMELIUS
CONTINUED CUT-BACK
MINING OF THE TITAN
AND PERSEVERANCE
OPEN PITS.”
2 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Titan Pit at Mt Magnet
CHAIRMAN’S REPORT
In the second quarter of 2016/17, Ramelius commenced open pit mining at Blackmans, located 30km to the
north of Mt Magnet. Gold ore from Blackmans was hauled to Mt Magnet for processing at the Checkers
processing plant. This satellite pit was completed in the June 2017 quarter and was followed by a small
extension mining operation of a shallow laterite ore zone stretching approximately 100 metres north of the pit.
During the year, Ramelius also progressed the Vivien underground gold mine and completed open pit mining
at Kathleen Valley, both located near Leinster in Western Australia. At Kathleen Valley, the focus during the
September 2016 quarter was on mining the two small Yellow Aster North and Nil Desperandum pits followed by
rehabilitation and mine closure activities. At the Vivien underground operation, stoping commenced early in the
financial year and a significant increase in gold ore production followed from both ore stoping and development
activities. The development of the underground decline was also progressed throughout the year, advancing 630
metres to the 200RL by 30 June 2017.
Gold ore from both the Kathleen Valley and Vivien gold mines was trucked to Mt Magnet for processing.
The Checkers processing plant processed 1.9 million tonnes of ore during the year at an average grade of 2.17g/t
for 124,747 ounces of recovered gold. Fine gold production for the year was 125,488 ounces. This production
result was very pleasing and compares to production of nearly 1.7 million tonnes at an average gold grade of
2.2g/t for 110,830 fine ounces of gold in 2016 and approximately 1.63 million tonnes at an average grade of
1.55g/t for 81,683 fine ounces in 2015.
Regarding new project development, Ramelius successfully progressed the Water Tank Hill project located 1.5km
to the west of the Mt Magnet township. Mining approvals for an underground mining operation were obtained
and Byrnecut Australia Pty Ltd was engaged as the underground mining contractor. Access to the underground
deposit was obtained by rehabilitating the nearby St George decline and developing link drives across to Water
Tank Hill. Ore development commenced in the last quarter of 2016/17 and by year end, ore was being trucked to
the Checkers processing plant.
The Company also successfully progressed the Milky Way project located 3.6km south of the Mt Magnet
Checkers processing facility. Geotechnical and hydrological studies and metallurgical test work were
completed and as result of successful drilling at the nearby Stellar and Stellar West area as well as at Shannon,
some 500 metres to the south-west of Milky Way, a new mining proposal was developed. Mining approval for the
new Cosmos mine area comprising Milky Way, Stellar, Stellar West and Shannon open pits together with Brown
Hill and Vegas pits in the Galaxy area was obtained in June 2017. Mining at the Milky Way and the Stellar West
pits commenced early in 2017/18 and ore from this operation will be processed at the nearby Checkers
processing plant. The Cosmos area is expected to underpin production at Mt Magnet over the next 2-3 years.
In addition to drilling at the Cosmos mine area, Ramelius also conducted significant exploration activities at the
following targets:
• The Morning Star gold project at Mt Magnet, including the Eddie Carson Lode where significant mineralisation
was intersected;
• The Black Cat Deeps gold project immediately to the south of Morning Star where drilling resulted in
encouraging intersections;
• The Boogardie Basin area at Mt Magnet including Venus, Zeus, Artemis and Bundy Flats prospects, and
the area east of the Hesperus Pit, where some good drilling results were returned, as well as at the Shannon
pit where economic intersections were drilled;
• The Paris pit, located half way between Morning Star and the St George/Water Tank Hill underground portal,
where very encouraging gold intersections were returned from first pass drill testing;
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 3
“THE FUTURE AUGERS WELL
AS WE CONTINUE TO GROW BY
ACQUISITION AND DISCOVERY.
I HAVE CONFIDENCE IN OUR
MANAGEMENT TEAM TO TAKE
THE STEPS WHICH WILL ENABLE
US TO CONTINUE TO DEVELOP
INTO A SIGNIFICANT GOLD
COMPANY FOR THE BENEFIT
OF SHAREHOLDERS.”
4 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Checkers Processing Plant at Mt Magnet
CHAIRMAN’S REPORT
• The Vivien gold project where successful underground diamond drilling and development sampling was
carried out and a wider quartz vein approximately 200 metres below the mine plan was intersected;
• The Yandan North gold project in Queensland where a ground magnetic survey defined several deeper drill
targets; and
• The Tanami joint venture gold project area in the Northern Territory where reconnaissance air-core drilling was
carried out over the Highland Rocks tenement.
The Company’s exploration success resulted in new Ore Reserves being generated for the Stellar, Stellar West,
Brown Hill, Vegas and Shannon deposits as well as the Vivien gold mine. For the second successive year,
Ramelius increased its Mineral Resource and Ore Reserve gold ounces after producing approximately 125,000
ounces of gold during the financial year, reporting the following estimates as at 30 June 2017:
• Total Mineral Resources of 36,351 million tonnes at 2.2g/t for 2,549,000 ounces of gold (2016: 29.305 million
tonnes at 2.3g/t for 2,196,000 ounces of gold); and
• Total Ore Reserves of 6,583 million tonnes at 2.1g/t for 452,000 ounces of gold (2016: 5.430 million tonnes at
2.3g/t for 405,000 ounces of gold).
In August 2016, the Company sold the Burbanks gold processing plant near Coolgardie in Western Australia
for a total consideration of $2.5 million payable by instalments over a two-year period. This plant was originally
purchased in late 2006 to process the high-grade gold ore from the Company’s first and very successful open pit
and underground mining operation at Wattle Dam in the Eastern Goldfields of Western Australia.
During the year your directors continued their search for new gold opportunities and in September 2017,
Ramelius announced the acquisition of the Edna May gold mining operations near Westonia in Western Australian
from Evolution Mining Limited for an upfront cash consideration of $40 million plus contingent further payments
of up to $50 million including production based royalties above 200,000 ounces.
The future augers well as we continue to grow by acquisition and discovery. I have confidence in our
management team to take the steps which will enable us to continue to develop into a significant gold
company for the benefit of shareholders.
I thank all our employees and contractors for their ongoing efforts during what has been a busy and interesting
year. I also thank our Managing Director, Mark Zeptner for his leadership of the management team and my fellow
non-executive directors, Kevin Lines and Mike Bohm.
Finally, on behalf of the Board, I thank all shareholders for your ongoing support and look forward to the year
ahead as we integrate the Edna May gold mine with our existing Ramelius operations.
Bob Kennedy
Chairman
Checkers Processing Plant at Mt Magnet
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 5
“YOUR COMPANY MADE
FURTHER PROGRESS
TOWARDS BECOMING A
MID-TIER PRODUCER IN
THE AUSTRALIAN GOLD
SECTOR WITH PRODUCTION
EXCEEDING 125,000
OUNCES.”
6 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Galaxy open pits at Mt Magnet
MANAGING DIRECTOR’S REPORT
Dear Shareholders,
During the 2016/17 financial year, your Company made further progress
towards becoming a mid-tier producer in the Australian gold sector with production exceeding 125,000 ounces,
up from the 110,000 ounces in the previous year. Supported by a healthy gold price, cash and gold reserves
grew further, ending the year close to A$90M. On top of this, the Company delivered a positive Net Profit after
Tax for the third year running, something we are obviously proud of and looking to build on.
In the first quarter of the year, Ramelius commenced mining at the Blackmans open pit project and worked to
finalise approvals at the Water Tank Hill underground project, both located at Mt Magnet. The Vivien underground
mine moved into stoping production after a successful development phase.
The second quarter saw the completion of ore haulage and processing of the Kathleen Valley open pit project, a
very successful venture for the Company which delivered almost tenfold returns on the initial $4M purchase price.
Mt Magnet’s Perseverance open pit was completed late in the third quarter with the nearby Titan open pit coming
online the following quarter, and mining activities at the new Cosmos Mine Area featuring the Milky Way, Stellar
and Shannon open pits commencing immediately prior to the end of the financial year. The Water Tank Hill
project intersected first ore during that last quarter and will be set up for stoping production early in the FY2018
year. The management and operations team has become adept at managing the processes involved with
regularly commissioning new operations, both open pit and underground.
Ramelius continued to both deliver into and add to its risk mitigating forward gold sales program, with coverage
currently out to June 2019 at an average price above A$1,710 per ounce.
The FY2017 year saw a record of almost $16M spent on exploration at Ramelius, with the benefits starting to be
realised within a resource and reserve inventory that grew at 16% and 12% respectively, according to the recent
inventory update. A further $11M has been budgeted for FY2018 to capitalise on the momentum gained in this
area, especially at Mt Magnet, with almost 90% targeted at brownfield style targets.
Subsequent to the end of the 2017 financial period, Ramelius successfully bid and settled on the purchase of
the Edna May gold mine in Western Australia from Evolution Mining Limited. The upfront consideration was for
$40M cash with further contingent payments up to $50M for production beyond an initial 200,000 ounces.
The purchase, effective 3rd October 2017, immediately catapults Ramelius into the +200,000 ounces per year
range and effectively doubles the ore reserve to a position exceeding 0.8Moz. The purchase is the next step in
the growth ambitions of the Company, made possible by reliable, profitable operations and an enviable balance
sheet allowing the upfront consideration to be fully funded from cash reserves.
As always, I would like to thank the Board and staff for their support and ongoing efforts during the year, with the
established mining teams at Mt Magnet and Vivien performing well. We look forward to integrating the new team
at Edna May into the Ramelius portfolio and to build on the momentum that a 200,000 ounce per annum
producer will undoubtedly bring us.
The Aussie gold mid-tier here we come!
Mark Zeptner
Managing Director
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 7
REVIEW OF OPERATIONS
Financial Summary
• Profit before tax of $25.1 million (down from $25.3 million in 2016)
• Sales revenue of $197.4 million (up 14% or $23.7 million from
$173.7 million in 2016)
• Gold sales of $197.0 million (up from $173.5 million in 2016)
• Operating activities provided $83.4 million
(up from $65.5 million in 2016). Investment
in mine development and exploration totalled
$67.2 million (up from $47.9 million in 2016)
• Debt free with cash as at 30 June 2017
of $78.6 million (up from $44.3 million
at 30 June 2016) which excludes gold
on hand at spot value of $11.3 million
(up from $5.4 million at 30 June 2016)
• Forward gold sales at 30 June 2017
of 102,000 ounces at an average
price of A$1,711 per ounce
“THE COMPANY DELIVERED
A POSITIVE NET PROFIT
AFTER TAX FOR THE THIRD
YEAR RUNNING,SOMETHING
WE ARE OBVIOUSLY PROUD
OF AND LOOKING TO
BUILD ON.”
Ore haulage trucks at Blackmans Gold Mine
8 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Total consolidated profit before income tax for the year ended 30 June 2017 was $25.1 million compared to
$25.3 million in the previous corresponding period.
Revenue from gold sales for the year ended 30 June 2017 increased by 14% to $197.0 million compared to
$173.5 million reported in the previous corresponding period for the continuing operation. This increase in gold
sales revenue has been driven by higher gold sales (11% to 121,031 ounces compared to 108,711 ounces in the
prior period) and a greater average realised gold price of A$1,628/oz which was up 2% from the previous
corresponding period.
At 30 June 2017, the group was debt free and held cash assets of $78.6 million (excluding gold on hand of
$11.3 million).
Total net assets increased during the year from $127.6 million to $169.8 million. Net assets per share at
30 June 2017 was $0.32 compared to $0.27 at the end of the previous financial year.
At 30 June 2017 forward gold sales totalled 102,000 ounces at an average gold price of A$1,711 for delivery
during the period to 28 June 2019.
Operational Summary
• Total of 125,488 ounces of fine gold produced during the financial year
• Mining activities at Kathleen Valley were completed during the year
following the successful mining and haulage of ore from the Mossbecker,
Yellow Aster Deeps, Nil Desperandum and Yellow Aster North open pits
• Mining of the high-grade Vivien underground gold mine continued during
the year with the mine achieving steady state production following the
commencement of stoping in June 2016
• Commenced pre-strip mining of the Milky Way open pit ahead of
schedule in late June 2017, ensuring a smooth transition from the
current mining activity in Titan open pit. Mining of the Perseverance
and Blackmans open pits were both completed during the year
• Completed decline rehabilitation and decline access and commenced ore
development at the Water Tank Hill underground gold mine at Mt Magnet
• Upgraded open pit mineral resource established for the Morning Star
gold project
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 9
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Figure 1: Operations Location
The Mt Magnet gold mine, 600km north-east from Perth in WA, was Ramelius’ core operation for the 2017
financial year, with mining and processing activities ongoing at Mt Magnet, supplemented by high grade ore
feed from the Vivien and Kathleen Valley gold mines. Vivien and Kathleen Valley are located 300km and
370km by road from the processing plant at Mt Magnet respectively.
The Kathleen Valley gold project was completed and subsequently sold to Liontown Resources Limited’s
(ASX:LTR) subsidiary LRL (Aust) Pty Ltd on 9 December 2016, with Ramelius retaining 100% of the gold
rights.
The Blackmans gold project is located some 30km north of Mt Magnet and was developed and mined in the
2017 financial year with only a portion of ore haulage remaining at the end of the period (refer Figure 2).
The Burbanks processing plant, 9km south of Coolgardie, was sold in the first Quarter of the financial year
to Maximus Resources Ltd (ASX:MXR) for a total consideration of A$2.5M, to be paid in instalments up to
final payment in August 2018 (refer Figure 1).
10 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 2: Mt Magnet & Leinster based project locations
Total fine gold production for the year was 125,488 ounces (refer Table 1).
2016/17
2015/16
Operation
Dry Tonnes
Milled (t)
Head
Grade (g/t)
Recovery
(%)
Fine Gold
Produced (oz)*
Fine Gold
Produced (oz)
Mt Magnet
Vivien
Kathleen Valley
Burbanks
Total Production
1,574,617
207,574
131,761
0
1,913,952
1.42
7.17
3.36
0
2.17
91%
96%
96%
-
93%
66,073
46,144
13,271
0
125,488
51,636
7,230
51,973
0
110,839
* Calculation difference relates to timing between gold production which includes gold in circuit and fine gold outturned.
Table 1: Total Gold Production
OPERATIONS
Mt Magnet Gold Mine
The Mt Magnet Gold Mine consists of numerous deposits, situated on granted mining leases, covering a total
area of 225km². Mt Magnet has produced over 6 million ounces of gold since its discovery in 1891. The
Hill 50 underground mine was the major producer until 2007 and was mined to 1,500 metres below surface,
whilst the Morning Star underground mine was mined to a depth of 980 metres. Gold is primarily associated
with a number of Banded Iron Formation (BIF) units that occur within a typical greenstone stratigraphy of
mafic and ultramafic units. In addition, gold occurs in a number of structurally controlled mafic hosted
deposits (e.g. Morning Star) and felsic porphyry hosted deposits (e.g. Milky Way).
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 11
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Mining by Ramelius at Mt Magnet has concentrated on the Galaxy area open pits over the past five years.
The Galaxy mining area is located approximately 2 kilometres from the processing plant (Checker). The
Cosmos area (Milky Way, Stellar, Stellar West & Shannon pits) is a further 1.5 kilometres south of Galaxy,
has been a strong focus for reserve additions and mining approvals during the 2017 financial year, whilst the
Water Tank Hill underground project commenced ore production June 2017 (refer Figure 3).
Figure 3: Mt Magnet key mining areas
During the year, the Mt Magnet operation saw a 13% increase in mill throughput due to changes to the SAG
mill liner configuration. This increased ore throughput, combined with Kathleen Valley ore and increasing
Vivien ore production lifted total gold production to a new record (refer Figures 4 & 5).
Reconciled mill production for the year was 1.91 million dry tonnes at a head grade of 2.17 g/t Au for
125,488 ounces of fine gold and mill recovery of 93%.
12 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 4: Mt Magnet mill throughput & head grade by Quarter
Figure 5: Mt Magnet gold production and unit costs by Quarter
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 13
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Open Pits
Mining was completed at the Perseverance open pit in March 2017. The pit was mined over 27 months and
the presence of significant underground voids from the upper portions of the Hill 50 mine slowed progress
toward the base of the pit. Overall production was similar to forecast and mill reconciled total production
was 1.11Mt @ 1.75g/t for 59,292 ounces.
The Blackmans satellite open pit (refer Figure 6) located 30km north of Mt Magnet, was also mined within
the 2017 FY. Activities commenced in September 2016 and the bulk of mining was completed by June 2017.
A small extension of a shallow laterite ore zone was mined just after the end of the financial year. Due to
complexity of the mineralisation, which comprises of narrow – discontinuous vein sets, mined ore grade was
diluted and lower than reserve, however total claimed ounces were higher. Total high-grade claimed mined
for the pit was 356,273t @ 1.61g/t for 18,418oz versus a Reserve of 243,718t @ 2.00g/t for 15,657oz.
Milling of high-grade and low-grade ore was still in progress at the end of the financial year.
Figure 6: Blackmans open pit April 2017
The major open pit focus for the 2017 financial year was at the Titan pit (refer Figure 7). Ore production
commenced in July 2016 and ramped up considerably from February 2017, once the cutback reached the
base of the old pit. At the end of FY2017 ore grade at Titan was performing significantly better than
predicted reserve grades and ore production was exceeding mill capacity. Approximately 400,000 tonnes @
1.25g/t of ore had been stockpiled at end of June 2017 to assist with transition to the new Cosmos pits.
14 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 7: Galaxy open pits April 2017 with Titan ore stockpiles in foreground
Water Tank Hill
The Water Tank Hill underground project commenced in the December 2016 Quarter. Access was gained
via rehabilitation of the St George underground decline, followed by the mining of two link drives 300m
across to the Water Tank Hill orebody.
Ore development and initial ore production occurred during June 2017. High grade BIF hosted ore (refer
Figure 8) is occurring as modelled and appears to be reconciling well at this early stage. Reconciled mill
production was 2,684 tonnes @ 7.19g/t for 583 ounces recovered.
Figure 8: Water Tank Hill high grade ore face 235 level (yellow is Au g/t)
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 15
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Vivien Gold Mine
Significant progress was made at Vivien with mining achieving full production rates by the June 2017
quarter. This was later than initially planned, however alterations to the mine plan were made to allow for
emplacement of cemented rock fill (CRF) floor pillars (300 & 260 levels) and use of CRF rib pillars in high-
grade zones (refer Figure 9). The use of CRF pillars will allow for 100% extraction of high-grade lode zones
and improve the project overall value.
Mill reconciled production for the year was 207,574t @ 7.17g/t for 46,144 ounces of fine gold. Stope
production accounted for 33% of mined ore.
A resource model update was generated in January 2017 and a new ore reserve generated in February 2017.
Inclusion of grade control data and increased geological confidence boosted the Resource and Reserve
figures and the net Reserve change for 12 months was +5,000oz after mining depletions. Mine life will be
extended to at least late 2019 based on these new Reserves.
Ore Reserves at 30 June 2017 were 440,000 tonnes @ 7.3g/t for 103,000 ounces (refer Table 3).
Eleven underground diamond holes totalling 3,703.1m were completed from the 247mRL hangingwall drill
drive, with most holes intersecting the target quartz vein. Three deeper holes intersected a wider quartz vein
in the lode position around 200 metres below the current mine plan, with results returned as below:
2.9m at 4.40 g/t Au from 367.09m in VVDD1059
2.8m at 3.10 g/t Au from 344.0m in VVDD1062
5.6m at 5.20 g/t Au from 330.4m in VVDD1064
Further infill drilling is being planned for the 2018 financial year.
Figure 9: Vivien development progress (grey) – oblique view to west
16 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Kathleen Valley Gold Mine
The Kathleen Valley gold project was completed in September 2016. The project lasted 16 months from
initial clearing and setup to completed site rehabilitation (refer Figure 10). Four pits were mined and the
project was a major success for Ramelius.
Although it mostly contributed in the 2016 financial year, final mining of the Nil Desperandum pit and ore
milling continued into FY2017, with production of 131,761t @ 3.36g/t for 13,271 ounces of fine gold.
Total reconciled production for the project was 468,011t @ 4.53g/t for 65,244 ounces recovered. Ore
tonnes, grade and mill recovery were all greater than feasibility figures resulting in a 54% increase over the
expected feasibility study cash flow.
Figure 10: Kathleen Valley rehabilitation – view to west
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 17
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
DEVELOPMENT PROJECTS
Cosmos Project
Cosmos consists of the Milky Way, Stellar, Stellar West and Shannon deposits located 1.5km south of
Galaxy and 3.5km south-west of the Checker mill. The 2017 financial year saw significant progress in
drilling, resource modelling, mine design and obtaining mining approval (June 2017) for the project.
Milky Way is a large, lower grade resource, with gold occurring in stockwork style, sericite-silica-pyrite
veining and alteration within a thick altered felsic porphyry unit. Stellar and Stellar West are of a similar
style. Historic pits exist for Milky Way, Stellar and Shannon. Stellar West is a new pit. The existing 67m
deep, Milky Way pit was mined in 1999 to 2000 by Mt Magnet Gold (WMC) and produced 626,723 tonnes
@ 1.64 g/t for 33,073 ounces of gold.
Mining of the Milky Way and Stellar West pits commenced in July 2017 at the start of the 2018 financial
year. The Milky Way ore reserve is 1.84Mt @ 1.3g/t for 77,000oz, while Stellar West contributes 267,000t
@ 1.8g/t for 15,000oz (refer Table 3). The Cosmos pits are expected to provide the major ore sources over
the 2018 and 2019 financial years.
The Shannon deposit is located 700m south of Milky Way. Resource drilling conducted during the 2017
financial year has extended and improved the resource considerably and a viable pit cutback was generated
(refer Figure 11). Shannon, while also felsic hosted, is a shear or lode style deposit centred on a high-grade
quartz vein. It is between 2 and 10m thick strikes north and has a moderate dip of 40 - 45°. Drilling during
the year included many economic hits with examples such as:
6m at 14.4 g/t Au from 247m in GXRC0549
4m at 6.13 g/t Au from 104m in GXRC0550
9m at 19.7 g/t Au from 144m in GXRC0553
6.2m at 39.5 g/t Au from 168.8m in GXDD0056
At the end of FY2017 further drilling was in progress and a new resource update was planned. Potential for
an underground mine will be evaluated.
Figure 11: Shannon cross section
18 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Morning Star Open Pit
A new open pit resource model was generated for Morning Star in April 2017, incorporating a significant
amount of new drilling completed in the 2017 financial year. The total mineral resource is now 9.19Mt @
1.7g/t for 506,000 ounces (refer Table 2).
Pit optimisation and design work generated an updated Ore Reserve as shown below. Work has also
commenced on environmental requirements with a view towards submitting a Mining Proposal in the 2018
financial year.
Mineral Resources and Ore Reserves
New estimates of Mineral Resources and Ore Reserves as at 30th June 2017 are shown below in Table 2 and
3 respectively.
MINERAL RESOURCES AS AT 30 JUNE 2017 - INCLUSIVE OF RESERVES
Measured
Indicated
Inferred
Total Resource
Deposit
Tonnes Au
('000s)
g/t
Au
Oz
Tonnes
('000s)
Au
g/t
92
1.8
5,000
5,254
4,866
49
2.2
4,000
115
Eastern Jaspilite
146
2.2
10,000
199
2.5
16,000
277
Galaxy
Morning Star
Bartus Group
Boomer
Britannia Well
Bullocks
Eclipse
Golden Stream
Hill 60
Lone Pine
Milky Way
O'Meara Group
Shannon
Spearmont - Galtee
Stellar
Stellar West
Welcome - Baxter
Total Open Pit Deposits
Hill 50 Deeps
Morning Star Deeps
Saturn UG
Water Tank Hill UG
Total UG deposits
Mt Magnet Stockpiles
Mt Magnet Total
Western Queen South
Coogee
Vivien
Kathleen Valley
Other Projects Total
222
708
279
1.6
2.0
5.5
279
594
1,581
5.5
1.2
2.3
Au
Oz
Tonnes
('000s)
318,000
4,017
301,000
4,322
8,000
68,000
12,000
21,000
11,000
12,000
14,000
15,000
238
786
40
134
41
7
309
147
114,000
1,258
18,000
27,000
2,000
32,000
22,000
15,000
151
81
207
124
97
198
1,010,000
12,157
209,000
26,000
396
334
1,607
49,000
89
284,000
2,426
Au
g/t
1.2
1.5
1.6
1.0
2.5
2.5
2.1
1.7
4.6
1.7
1.2
1.5
3.9
4.3
1.9
1.1
1.8
1.5
6.4
5.0
2.5
4.9
3.5
Au
Oz
159,000
205,000
Tonnes
('000s)
9,364
9,188
12,000
402
26,000
1,980
3,000
11,000
3,000
-
46,000
8,000
179
242
401
208
160
309
623
50,000
3,918
7,000
10,000
28,000
7,000
3,000
11,000
383
330
232
761
511
696
589,000
29,886
81,000
1,607
53,000
528
127,000
1,607
14,000
318
275,000
4,060
1.9
1.9
2.1
1.8
2.0
3.3
2.8
2.2
2.9
1.7
1.3
2.5
3.3
2.9
1.5
1.7
1.6
1.8
7.0
4.2
6.6
6.5
2.2
3.6
3.6
6.7
3.4
5.4
2.3
1,294,000
14,582
12,000
4,000
114,000
24,000
154,000
81
65
174
523
844
1,448,000
15,426
1.8
3.4
3.3
5.5
2.5
3.3
1.9
864,000
34,539
9,000
7,000
31,000
42,000
185
96
785
745
89,000
1,812
953,000
36,351
Au
g/t
1.6
1.7
1.8
1.5
2.0
3.2
2.4
2.1
2.8
4.6
1.9
1.3
2.1
3.5
4.1
1.6
1.6
1.7
1.7
6.6
4.7
2.5
6.1
4.7
1.2
2.0
3.5
3.4
6.9
2.8
4.7
2.2
Au
Oz
482,000
506,000
24,000
94,000
12,000
24,000
32,000
15,000
14,000
46,000
39,000
164,000
25,000
37,000
30,000
39,000
25,000
37,000
1,645,000
339,000
79,000
127,000
63,000
608,000
23,000
2,276,000
21,000
11,000
175,000
66,000
273,000
2,549,000
1,194
179
202
121
167
154
2,660
231
249
25
637
414
276
11,000
46,000
17,021
49,000
932
195
229
49,000
1,355
118,000
18,376
104
31
530
222
886
23,000
-
-
-
-
594
Total Resources
1,581
2.3
118,000
19,262
Note: Figures rounded to nearest 1,000 tonnes, 0.1 g/t and 1,000 ounces. Rounding errors may occur.
Table 2: 2017 Mineral Resource Statement
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 19
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
ORE RESERVE STATEMENT AS AT 30 JUNE 2017
Tonnes
('000s)
Proven
Au
g/t
Probable
Total Reserve
Au
Oz
Tonnes
('000s)
Au
g/t
Au
Oz
Tonnes
('000s)
Au
g/t
Au
Oz
Galaxy Pits
Titan
Brown Hill
Brown Hill North
Vegas
Cosmos Pits
Milky Way
Stellar
Stellar West
Shannon
Morning Star Pit
Morning Star
Satellite Pits
Boomer
Lone Pine
O'Meara
Golden Stream
Underground
Water Tank Hill
Stockpiles
Mt Magnet Total
Vivien Underground
Total Reserves
8
1.6
-
594
602
602
1.2
1.2
23,000
23,000
1.2
23,000
213
623
18
192
1,836
388
267
208
1,099
132
258
46
95
167
5,541
440
5,982
1.5
1.6
2.6
1.4
1.3
1.5
1.8
2.9
1.9
2.9
1.8
3.4
3.0
11,000
31,000
2,000
8,000
77,000
19,000
15,000
20,000
221
623
18
192
1,836
388
267
208
68,000
1,099
12,000
15,000
5,000
9,000
6.5
34,000
1.8
7.3
326,000
103,000
2.2
429,000
132
258
46
95
167
594
6,143
440
6,583
1.5
1.6
2.6
1.4
1.3
1.5
1.8
2.9
1.9
2.9
1.8
3.4
3.0
6.5
1.2
1.8
7.3
2.1
11,000
31,000
2,000
8,000
77,000
19,000
15,000
20,000
68,000
12,000
15,000
5,000
9,000
34,000
23,000
349,000
103,000
452,000
Note: Figures rounded to nearest 1,000 tonnes, 0.1 g/t and 1,000 ounces. Rounding errors may occur.
Table 3: 2017 Ore Reserve Statement
20 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
EXPLORATION
During the 2017 financial year Ramelius explored a suite of gold exploration projects at various stages of
advancement, as shown on Figure 12.
Figure 12: FY2017 Brownfields & Greenfields Exploration Projects
Mt Magnet (WA)
(Ramelius 100%)
Exploration activity at Mt Magnet during the year focused on drilling the shallow depth extensions to the
Morning Star deposit ahead of resource modelling as well as exploring the Morning Star Deeps, below 1km
from surface, along with scoping for open pittable porphyry hosted gold mineralisation within the larger
Boogardie Basin (refer Figure 13).
An aggregate of 43,331m of exploration RC drilling and 7,208.7m of diamond drilling, as part of the Phase 1
Morning Star Deeps programme, was completed.
The Company also commenced an aggressive campaign of Aircore drilling throughout the Boogardie Basin.
The drilling aimed to penetrate well into fresh rock below the base of oxidation around 50m below surface.
Truly representative fresh drill chip samples amenable to alteration mapping and bottom of hole trace
element determinations were collected. An aggregate of 79,106m was drilled throughout the year.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 21
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Figure 13: Location of the Boogardie Basin and Morning Star pit relative to the active mining areas
MORNING STAR OPEN PIT EXTENSION
A series of deeper RC drill holes was completed below the Morning Star pit to test for blind mineralised
porphyry and/or banded iron formation units away from the historically mined high grade lode positions
(refer Figure 14). Better intersections returned from the Morning Star drilling include:
10m at 6.56 g/t Au from 290m in GXRC1464
21m at 1.91 g/t Au from 225m in GXRC1465 and
11m at 2.21 g/t Au from 259m in GXRC1465
7m at 5.16 g/t Au from 152m in GXRC1470, incl. 1m at 30.2 g/t Au
14m at 40.71 g/t Au from 39m in GXRC1471, incl. 3m at 186.3 g/t Au
12m at 2.06 g/t Au from 47m in GXRC1472
15m @ 3.49 g/t Au from 111m in GXRC1520, incl. 5m @ 6.25 g/t Au
10m @ 2.89 g/t Au from 166m in GXRC1524
3m @ 11.47 g/t Au from 180m in GXRC1524
4m @ 20.21 g/t Au from 113m in GXRC1525, incl. 1m @ 75.5 g/t Au
12m @ 5.53 g/t Au from 173m in GXRC1525, incl. 2m @ 24.48 g/t Au
41m at 1.95 g/t Au from 11m in GXRC0536
20m at 4.20 g/t Au from 24m in GXRC0540
22 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
BLACK CAT SOUTH
RC drilling targeted the saddle between the Morning Star pit and the Black Cat South pit (refer Figure 15).
Drilling was testing the historically mined chert/banded iron hosted mineralisation as well as quartz veins in
mafic volcaniclastics and mineralised porphyry lenses in the hangingwall (west of the historically mined
main lode). Better reported results include:
7m at 5.98 g/t Au from 100m in GXRC1509, incl. 1m at 27.3 g/t Au
3m at 7.36 g/t Au from 83m in GXRC1510, incl. 1m at 17.35 g/t Au
3m at 9.08 g/t Au from 61m in GXRC1511, incl. 1m at 20.9 g/t Au
7m at 3.25 g/t Au from 109m in GXRC1540
7m at 4.06 g/t Au from 209m in GXRC1541
3m at 15.95 g/t Au from 119m in GXRC1578
PARIS OPEN PIT
RC drilling was completed under the shallow Paris open pit located 1km south of Morning Star, half way
towards the Water Tank Hill/St George portal. The mineralisation at Paris is hosted by banded iron
formation, believed to be the strike extension of the Nathan BIF at Morning Star that extends southwards to
Water Tank Hill/St George. Very encouraging gold intersections were encountered from this first pass test
and additional step out drilling is planned during FY2018. Better results include:
22m at 5.85 g/t Au from 31m in GXRC0530, incl. 7m at 13.05 g/t Au
22m at 1.77 g/t Au from 25m in GXRC0533
HESPERUS EAST
Broad zones of significant gold mineralisation were returned from selected RC drilling east of the Hesperus
pit (refer Figure 13). The deeper RC holes have shown good dip continuity of mineralised intersections.
Gold mineralisation is associated with a series of north-northwest striking felsic porphyry rocks intruding
into the mafic/ultramafic stratigraphy. They are disrupted by the north-easterly trending Boogardie Breaks.
Better porphyry hosted drill results occur where the Boogardie Breaks intersect the porphyry units, and
include:
20m at 1.23 g/t Au from 31m in GXRC1501
16m at 1.32 g/t Au from 105m in GXRC1505
20m at 1.34 g/t Au from 44m in GXRC1506 and
12m at 2.44 g/t Au from 26m in GXRC1507
MORNING STAR UPPER ZONE
Detailed logging and sampling of the Morning Star Deeps parent hole (MSD0056) identified gold
mineralisation associated with the down dip projection of the Evening Star Chert around 700mbs (Figure
16). An encouraging drill intersection of 3.75m at 15.58 g/t Au from 714m was returned. While subsequent
wedges (I and H) drilled up and down dip (35m away) failed to define any immediate plunge continuity, the
result is considered encouraging as it highlights the potential for high grade mineralised shoots to be
developed within the upper levels of the Evening Star Chert, between 300 – 700m below surface. The
broader target (Morning Star Upper Zone) is very poorly drill tested to date. Further exploratory drilling is
scheduled during FY2018.
MORNING STAR DEEPS
Deeper exploratory diamond drilling down to 1,500mbs was completed as follow-up to highly encouraging
historical diamond drill hole intersections (completed in 1999), including:
16m at 9.05 g/t Au from 1,145m in MSD0044F and
11.6m at 9.99 g/t Au from 1,178m in MSD0044F and
8.0m at 10.20 g/t Au from 1,196m in MSD0044F
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 23
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
As part of its Phase 1 drilling campaign, Ramelius completed 13 wedges, including the parent diamond hole,
MSD0056, for an aggregate 7,208.7m (refer Figure 17).
Better results from the diamond drilling include:
4.90m at 26.49 g/t Au from 1277.30m in MSD0056C
4.80m at 4.70 g/t Au from 1293.0m in MSD0056C
6.89m at 8.78 g/t Au from 1,355.81m in MSD0056E, including 1.62m at 14.52 g/t Au
7.05m at 9.07 g/t Au from 1202.10m in MSD0056I, including 3.90m at 15.13 g/t Au
4.80m at 9.62 g/t Au from 1183.20m in MSD0056I, including 0.56m at 77.2 g/t Au
10.00m at 5.43 g/t Au from 1128.00m in MSD0056J, including 6.05m at 8.61 g/t Au
8m at 4.65 g/t Au from 1190.00m in MSD0056K
2.13m at 8.19 g/t Au from 1173.92m in MSD0056L
The plunge of the high-grade shoots is depicted in Figure 17. The mineralised keel intersections sit along the
folded contact between basaltic flows and andesitic tuffs. Younging indicators suggest the rocks are
overturned, hence those lodes that lie above the contact in the overlying (older) basaltic flows are termed
hangingwall lodes whilst those that lie below the contact in the underlying (younger) andesitic tuffs and
flows are termed footwall lodes.
Figure 14: Morning Star pit plan view highlighting the Morning Star Deeps
section A-B’ and the saddle between Morning Star & Black Cat South pit B-C’
24 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 15: North-south section (B-C’) through the saddle region between the Morning Star and Black Cat
South pit looking east (see Figure 14 for location)
Open pit mining at Mt Magnet Gold Mine
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 25
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Figure 16: Section through A-B’ (see Figure 14 for location) highlighting the recent Morning Star Upper
drilling results and historical Deeps drilling assays
The underground tag board at Vivien Gold Mine
26 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 17: Zoom of Morning Star Deeps section through A-B’ (see Figure 14 for location)
highlighting the recent Deeps drilling results. The mineralisation remains open with depth,
plunging out of the plane of the diagram
BOOGARDIE BASIN – AIRCORE DRILLING
Regional Aircore drilling traverses within the Boogardie Basin continued throughout the year. The Aircore
drilling was targeting porphyry-ultramafic contacts in areas of ineffective historical drilling coverage as well
as targeting shallow plus 100ppb gold in regolith anomalies and/or historical bottom of shallow
RAB/Aircore anomalies where present. The drilling successfully delineated coherent plus 100ppb gold in
saprolite anomalies, below the limit of historical shallow drilling. Significant, mappable geochemical
patterns are now being recognised along the northeast trending Boogardie Break corridors.
Several new prospect areas have been identified from the drilling programmes and will be the focus of
deeper RC drill testing during FY2018.
ZEUS PROSPECT
Exploration drilling adjacent to the Stellar West deposit delineated significant quartz vein hosted gold
mineralisation along the western flank of the newly named Zeus Porphyry. A single reconnaissance RC drill
hole (GXRC1492) returned a highly encouraging intersection of 8m @ 12.20 g/t Au from 65m, to end of
hole, associated with the abundant quartz veining within altered porphyry on the contact with ultramafics.
This intersection correlates well with the significant porphyry hosted Aircore drill results up to 19m @ 1.31
g/t Au from 32m, located 140m further north.
Initial RC drilling showed very encouraging intersections, including 20m at 1.11 g/t Au from 70m in
GXRC1542 and 18m at 3.40 g/t Au from 103m in GXRC1543 within broader, mineralised porphyry
intervals up to 67m at 1.47 g/t Au from 54m.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 27
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Subsequent step out RC drilling (50-100m spacings) over the 500m striking trend at Zeus (see Figures 18
and 19) returned broad intervals of gold mineralisation associated with a blue quartz eye diorite porphyry
intrusion. Better intersections included:
229m at 0.41 g/t Au from 59m in GXRC1626
9m at 4.59 g/t Au from 116m to EOH in GXRC1634, including 1m at 28.3 g/t Au
101m at 0.59 g/t Au from 115m in GXRC1628, and
141m at 0.59 g/t Au from 36m in GXRC1646
True widths remain undetermined at the time of reporting given the multiple shear/lode orientations
interpreted in the data, but the favoured interpretation is a series of tension gashes (ladder vein arrays)
dipping 450 east and constrained by the quartz eye diorite host (refer Figure 18). Further infill drilling is
planned for FY2018.
Figure 18: RC drilling cross section through the Zeus Prospect. Gold mineralisation is interpreted to be
preferentially controlled by zones of tension gashes (ladder vein sets) within the competent quartz eye diorite
host
28 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 19: Overview map of the Boogardie Basin highlighting maximum downhole gold ppm from drilling.
The gold geochemistry is overlying a 1VD-RTP aeromagnetic image and the mapped/interpreted extent of
the felsic porphyry intrusions; as constrained by the magnetic data and drilling to date. Litho-structural
corridors favourable for the ingress and deposition of significant gold mineralisation are now being
highlighted. The confluence of structures and/or their intersection with buried porphyry contacts represent
primary targets for shallow plunging ore shoots to be developed. This interpretive 3-D modelling is ongoing.
The newly discovered Zeus Prospect (highlighted) is shown in the top left hand corner of this figure and now
extends over 500m on or near the confluence of the NE trending shear and an inferred NNW trending thrust.
Kathleen Valley Gold Project (WA)
(Ramelius 100% - Gold Rights Only)
No significant results (>0.5 g/t Au) were returned from a programme of 6 deeper RC drill holes (1,267m)
early in the year, targeting the down dip faulted offset to the Mossbecker pit mineralisation, referred to as the
Boris Zone.
Liontown Resources Limited (ASX: LTR) subsequently acquired the Kathleen Valley Project tenements
from Ramelius; including 100% of the rare metal rights (lithium, tantalum and associated metals); see ASX
Release from LTR dated 4 August 2016. Under the terms of the Tenement Sale Agreement Ramelius retains
100% of the gold rights to the tenement package and the Company will continue to explore for buried gold
mineralisation within the project as new targets are identified.
Coogee Gold Project (WA)
(Ramelius 100%)
Two shallow diamond drill holes were completed early in the year for an aggregate 240m. The drilling was
testing below gold anomalous bottom of hole Aircore intersections reporting up to 1m at 1.38 g/t Au from
27m at the Coogee Beach prospect (refer Figure 20). No significant results were returned. Consequently,
the decision was made to farm-out the Coogee Project.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 29
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Figure 20: Coogee Beach (EL26/177) Aircore anomaly draped over a 1VD-RTP aeromagnetic image.
Coogee Beach is 2km west of the now mined Coogee Pit
Tanami JV (NT)
(Ramelius 85%)
Ramelius holds 85% equity in the Tanami Joint Venture and continues to sole fund the exploration
expenditure, free carrying Tychean Resources Limited (ASX:TYK) through to any decision to mine.
The package of joint venture tenements extends over 1,700km2 and is located within 100km radius of
Newmont’s giant +20 million ounce Callie Gold mine (Figure 21).
An aggregate 5,780m of reconnaissance Aircore drilling was completed over the Highland Rocks ELs during
the year (HRAC0001 – 167). Disappointingly, only low order gold anomalism was returned from the
drilling program (see ASX Release dated 19 December 2016).
30 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Review of Operations
Figure 21: Tanami JV project location
Vivien Gold Project (WA)
(Ramelius 100%)
No surface gold exploration was undertaken during the year over the Vivien leases. Underground mine
extension drilling commenced once a suitable cuddie access was established, see Vivien Gold Mine
Operations for details.
Yandan Project (QLD)
(Ramelius 100%)
The Yandan North EPM is located 10km north and along strike of the abandoned Yandan gold mine which
historically produced over 350,000oz of gold. Greenfields exploration was undertaken over the Yandan
leases that included field mapping and rock chip sampling that identified several areas of outcropping
hydrothermal sulphidic breccias. A ground magnetic survey (60 line km) and an induced polarisation (IP)
survey (approximately 9 line km) were undertaken that defined several deeper drill targets which will be
tested during the first quarter of the 2018 financial year.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 31
REVIEW OF OPERATIONS
Ramelius Resources Limited
Review of Operations
Figure 22: Geology map of the Yandan North EPM showing the mapped hydrothermal breccia outcrops
and rock chip sample locations
Drillhole Intercepts Note: All drillhole intercepts listed or displayed above have previously been reported in
RMS ASX JORC compliant releases during the 2017 Financial Year.
The Information in this report that relates to Exploration Results, Mineral Resources and Ore Reserves is
based on information compiled by Kevin Seymour (Exploration Results), Rob Hutchison (Mineral Resources)
and Duncan Coutts (Ore Reserves).
Kevin Seymour, Rob Hutchison and Duncan Coutts are all Members of the Australasian Institute of Mining
and Metallurgy and have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity they have 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”. Kevin Seymour, Rob Hutchison and Duncan Coutts are full-time employees
of Ramelius Resources Limited and consent to the inclusion in this report of the matters based on their
information in the form and context in which it appears.
32 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
GLOSSARY OF TERMS
Ramelius Resources Limited
Glossary of Terms
ADSORPTION:
AEROMAGNETICS:
AIRCORE:
ANOMALOUS:
ANDESITE:
ARCHAEAN:
AURIFEROUS:
AUGER:
AS:
ASX:
AU:
AZ:
BASALT:
BASE METAL:
BCM:
BERM:
BIF:
BIOTITE:
BRECCIA:
CALCRETE:
CARBONATE:
CHERT:
CHLORITE:
CIL CIRCUIT:
COMPANY:
CONGLOMERATE:
COSTEAN:
CU:
CUDDY:
CUT:
DEAD BULLOCK FORMATION:
DIAMOND DRILLING
The attraction of molecules (of gold) in solution to the surface of solid bodies
(carbon).
A geophysical technique measuring changes in the earth’s magnetic field from an
airborne craft.
A method of rotary drilling whereby rock chips are recovered by air flow returning
inside the drill rods rather than outside, thereby providing usually reliable samples.
A departure from the expected norm. In mineral exploration this term is generally
applied to either geochemical or geophysical values higher or lower than the norm.
Fine grained intermediate volcanic rock, chemically similar to diorites.
The oldest rocks of the Earth’s crust – older than 2,400 million years.
Gold bearing material.
A screw-like boring or drilling tool for use in clay or soft sediments.
Arsenic.
The Australian Securities Exchange Limited (ACN 008 629 691).
Gold.
Azimuth, a surveying term, the angle of horizontal difference, measured clockwise,
of a bearing from a standard direction, as from north.
Dark coloured fine grained extrusive igneous rock that is the most common rock
type of lava flows.
Non-precious metal, usually referring to copper, zinc and lead.
Bank Cubic Metre. Usually refers to the volume of waste measured in situ.
A horizontal bench left in the wall of an open pit to provide stability to the wall.
Banded Iron Formation.
A mineral of the mica group widely distributed in a variety of rock types.
Poorly sorted cemented angular rock fragments.
Soil and superficial material cemented by calcium carbonate.
A common mineral type consisting of carbonates of calcium, iron and/or
magnesium.
A microcrystalline sedimentary rock consisting of silica and formed by chemical or
biological processes.
A representative of a group of micaceous greenish minerals which are common in
low grade schists and is also is a common mineral associated with hydrothermal ore
deposits.
That part of the gold treatment plant where gold is dissolved from the pulverised
rock and subsequently adsorbed onto carbon particles from which the gold is
ultimately recovered.
Ramelius Resources Limited (ACN 001 717 540)
Rock consisting of rounded or sub-rounded fragments
A trench dug through soil to expose the bedrock.
Copper.
Drill cuddy refers to an underground drill site excavated off the decline/development
drive.
A term used when referring to average assays where the grade of a particularly high-
grade interval is reduced to a lesser value.
Tanami Goldfield stratigraphically significant formation comprised of Blake Beds
interbedded siltstones and carbonaceous siltstones, cherts and Callie laminated
sedimentary beds/schists overlain by the Davidson Beds including the Orac cherts
and schist overlain by the Coora Dolerite, in turn overlain by the Schist Hill
Formation (BIF).
Type of drilling where sample collection gives a continuous run of solid core which
can be oriented, measured and sampled. Usually half core is sampled for analysis,
leaving half core for future geological reference.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 33
GLOSSARY OF TERMS
Ramelius Resources Limited
Glossary of Terms
DISSEMINATED:
DIORITE:
DIP:
DYKE:
EL:
ELA:
EM:
EOH:
EPM:
EPMA:
EPITHERMAL:
FAULT:
F.C.I:
FELSIC:
Usually referring to minerals of economic interest scattered or diffused through-out
the host rock.
A course grained intermediate plutonic rock (cf andesite).
The angle at which rock stratum or structure is inclined from the horizontal.
Tabular igneous intrusive cutting the bedding or planar features in the country rock.
Exploration Licence.
Exploration Licence Application.
Electromagnetic, a geophysical technique used to detect conductive material in the
earth.
End of Hole.
Exploration Permit for Minerals, Queensland State equivalent to an EL
Exploration Permit for Minerals Application
High level (shallow depths – less than 1km deep), low temperature (< 300deg C)
hydrothermal (gold) mineralising processes formed in magmatic arc environments
(including rifts). Distinguished as low or high sulphidation systems.
A fracture in rocks along which rocks on one side have been moved relative to the
rocks on the other.
Free carried interest.
Light coloured rock containing an abundance of any of the following: - feldspars,
felspathoids and silica.
Containing iron.
A Mining Term for the different levels in an open pit.
Lower surface sitting below an inclined vein or dipping fault, cf hangingwall.
FERRUGINOUS:
FLITCH:
FOOTWALL:
GEOCHEMICAL EXPLORATION: Used in this report to describe a prospecting technique, which measures the content
GEOPHYSICAL EXPLORATION:
G/CC:
G.I.C:
G/T:
GOSSAN:
GROSS GOLD ROYALTY:
GRADE:
GRANITE:
GRATICULAR BLOCK:
GRAVITY CIRCUIT:
GSWA:
HA:
HANGINGWALL:
HG:
HYPOGENE:
INTERFACE:
IP:
3-D IP:
of certain metals in soils and rocks and defines anomalies for further testing.
The exploration of an area in which physical properties (e.g. Resistivity, gravity,
conductivity and magnetic properties) unique to the rocks in the area quantitatively
measured by one or more geophysical methods.
Grams per cubic centimetre.
Gold in circuit.
Grams per tonne, equivalent to parts per million (ppm).
The oxidised, near surface part of underlying primary sulphide minerals.
A royalty payment based on the total amount of product (gold) produced.
g/t – grams per tonne, ppb – part per billion, ppm – parts per million.
A coarse grained igneous rock consisting of quartz, feldspar and biotite/muscovite
plus accessory minerals
With respect to Exploration Licences, that area of land contained within one minute
of Latitude and one minute of Longitude.
Part of the Gold Treatment Plant where gold particles are accumulated by virtue of
their density.
The Geological Survey of Western Australia.
Hectare.
Upper surface sitting above an inclined vein or dipping fault, cf footwall.
Mercury.
Term used to describe the formation of mineral deposits originating by ascending
fluids, below any near surface supergene enrichment.
Low level geochemical sampling medium located at the base of transported
overburden and the top of the prospective host rock lithologies.
Induced Polarisation, electrical, ground geophysical exploration technique.
Three dimensional IP survey, designed to detect trends oblique to the IP survey grid,
of conventional 2-D surveys grids established orthogonal to the targeted trends.
34 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Glossary of Terms
IRG:
JORC:
KM:
KOMATIITE:
LAG:
LATERITE:
LEACHWELL:
LODE DEPOSIT:
LOW SULPHIDATION:
LTI:
MASSIVE:
MINERALISED:
M TONNES:
M:
MBS:
MTPA:
ML:
MLA:
NATIVE TITLE:
NATIVE TITLE TRIBUNAL:
NI:
OPEN PIT:
ORE GRADE:
OVERCALL:
OXIDISED:
OZ:
PALAEO:
PB:
PEDOGENIC:
PENTLANDITE:
PETROLOGICAL:
PERCUSSION DRILLING:
PD:
PL:
PLA:
PLUNGE
Intrusive related gold mineralised system, associated with vertically zoned (gold and
base metals), skarned, veined or disseminated, often brecciated within or along
margins of middle to high level magmatic intrusive rocks, being fractionated
felsic/granitic plutons.
The Australasian Code for Reporting of Mineral Resources and Ore Reserves.
Kilometre.
An ultramafic rock with high magnesium content extruded from a volcano.
A residual deposit remaining after finer particles have been blown away by wind.
Highly weathered residual material rich in secondary oxides or iron and/or
aluminium.
An analytical method.
A vein or other tabular mineral deposit with distinct boundaries.
Developed from near neutral pH circulating geothermal fluids at shallow levels in a
rift (gold-silver+adularia rich mineralised veins) or an arc environment (quartz-
sulphides-gold and affinities with magmatic source rocks).
Loss Time Injury.
Large in mass, having no stratification. Homogeneous structure.
Rock impregnated with minerals of economic importance.
Million tonnes.
Metre.
Metres below surface.
Million tonnes per annum.
Mining Lease.
Mining Lease Application.
Native Title is the recognition in Australian law of Indigenous Australian’s rights
and interests in land and waters according to their own traditional laws and customs.
In June 1992, the High Court of Australia, in the case of Mabo v Queensland (1992)
175 Commonwealth Law Reports 1, overturned the idea that the Australian
continent belonged to no one at the time of European’s arrival. It recognised for the
first time that indigenous Australians may continue to hold native title. Indigenous
Australians may now make native title claimant applications seeking recognition
under Australian law of their native title rights.
The Native Title Tribunal set up under the Native Title Act 1993.
Nickel.
A mine excavation produced by quarrying or other surface earth-moving equipment.
The grade of material that can be (or has been) mined and treated for an economic
return.
Refers to more metal (gold) being recovered than anticipated.
Near surface decomposition by exposure to the atmosphere and groundwater,
compare to weathering.
Troy ounces = 31.103477 grams.
Ancient or past times
Lead.
The development of soil.
An important ore of nickel (FeNi)9S8
Pertains to a study of the origin, distribution, structure and history of rocks.
Method of drilling where rock is broken by the hammering action of a bit and the
cuttings are carried to the surface by pressurised air returning outside the drill pipe.
Palladium.
Prospecting Licence.
Prospecting Licence Application.
Being the angle between the axis and the horizontal line lying in a common vertical
plane.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 35
GLOSSARY OF TERMS
Ramelius Resources Limited
Glossary of Terms
PORPHYRY:
PPB:
PRIMARY GOLD:
PROTEROZOIC:
PT:
PYRITE:
PYRRHOTITE:
QUARTZ:
RAB DRILLING:
RC DRILLING:
REIDEL FAULT:
REGOLITH:
RESERVE:
RESOURCE:
RHYOLITE:
ROCK CHIP SAMPLE:
SAPROLITE:
SB:
SECONDARY GOLD:
SEDIMENTARY ROCKS:
SERICITE
SHEAR ZONE:
SILICIFIED/SILICA:
STOCKWORK:
STRATIGRAPHY:
STRIKE:
SULPHIDES:
SUPERGENE:
T:
TEM:
TENSION GASHES:
TOLL TREATMENT:
TONNE:
TREMOLITE:
TUFFS:
ULTRAMAFIC:
A felsic or sub volcanic rock with larger crystals set in a fine groundmass.
Parts per billion.
Gold mineralisation that has not been subject to weathering processes, as opposed to
Secondary Gold.
The Precambrian era after Archaean.
Platinum.
A common, pale bronze iron sulphide mineral.
An iron sulphide mineral.
Mineral species composed of crystalline silica.
Rotary Air Blast Drilling: Method of drilling in which the cuttings from the bit are
carried to the surface by pressurised air returning outside the drill pipe. Most “RAB”
drills are very mobile and designed for shallow, low-cost drilling of relatively soft
rocks.
Reverse Circulation Drilling: A method of drilling whereby rock chips are recovered
by air flow returning inside the drill rods rather than outside, thereby providing
usually reliable samples.
A slip surface that develops during the early stage of shearing.
A layer of fragmented and unconsolidated material that overlies or covers basement.
The mineable part of a resource to which a tonnage and grade has been assigned
according to the JORC code.
Mineralisation to which a tonnage and grade has been assigned according to the
JORC code.
Fine grained glassy acid (felsic) volcanic rock.
A series of rock chips or fragments taken at regular intervals across a rock exposure.
A chemically weathered rock typically representing deep weathering of bedrock.
Antimony.
Gold mineralisation that has been subject to and usually enriched by weathering
processes.
Rocks formed by deposition of particles carried by air, water or ice.
Mica (layered lattice) mineral of the muscovite group typically found as a
hydrothermal alteration mineral in gold deposits.
A generally linear zone of stress along which deformation has occurred by
translation of one part of a rock body relative to another part.
Alteration of a rock by introduction of silica.
Large scale ramifying and dichotomising series of fissures filled with mineral
(silica-sulphides) material.
The study of formation, composition and correlation of sedimentary rocks.
The direction of bearing of a bed or layer of rock in the horizontal plane.
Minerals consisting of a chemical combination of sulphur with a metal.
Processes involving percolating groundwater including solution, hydration,
oxidation and typically enrichment of immobile/insoluble metals or ions.
Tonnes.
Transient Electromagnetic, a geophysical technique used to detect conductive
material in the earth.
Ladder vein array or joint opened up as a result of tensional forces developed during
deformation, usually becomes filled with quartz.
The treatment of ores where payment is made to the operator of the treatment plant
according to the amount of material being treated.
32,125 Troy ounces.
A pale coloured amphibole mineral.
General term for unconsolidated volcaniclastic/pyroclastic material, which upon
consolidation becomes a tuff
An igneous rock comprised chiefly of mafic minerals.
36 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Glossary of Terms
UNCUT:
VACUUM DRILLING:
VOLCANICLASTIC ROCKS:
YOUNGING:
A term used when referring to average assays where the grade of a particularly high-
grade interval is not reduced to a lesser value.
A method of rotary drilling where the drill cuttings are recovered inside the drill
rods by a vacuum system.
Pyroclastic rocks where fragments of volcanic material have been blown into the
atmosphere by explosive volcanic activity.
Refers to orientation direction of the youngest (uppermost) rocks within the
stratigraphic pile based upon volcanic textural evidence.
Road Train from Blackmans Gold Mine
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 37
NATIVE TITLE STATEMENT
Ramelius Resources Limited
Native Title Statement
Ramelius Resources Limited
Native Title Statement
Exploration and mining areas held by the Company may be subject to issues associated with Native Title. Whilst it is
not appropriate to comment in any detail upon specific negotiations with Native title parties, the directors of Ramelius
Exploration and mining areas held by the Company may be subject to issues associated with Native Title. Whilst it is
believe it is important to state the Company’s policy and approach to Native Title and dealings with indigenous
not appropriate to comment in any detail upon specific negotiations with Native title parties, the directors of Ramelius
communities.
believe it is important to state the Company’s policy and approach to Native Title and dealings with indigenous
The directors believe that the following native title policy statement summarises the Company’s desire to develop a
communities.
spirit of cooperation in its dealings with indigenous people, create goodwill, mutual awareness and understanding and
The directors believe that the following native title policy statement summarises the Company’s desire to develop a
most importantly, respect and commitment.
spirit of cooperation in its dealings with indigenous people, create goodwill, mutual awareness and understanding and
Recognition and Respect
most importantly, respect and commitment.
Ramelius recognises Aboriginal regard for land and respects their culture, traditions and cultural sites.
Recognition and Respect
Ramelius recognises Aboriginal regard for land and respects their culture, traditions and cultural sites.
Understanding and Trust
Ramelius listens to Aboriginal community representatives to understand their views and beliefs. Recognising that
Understanding and Trust
communities may not be fully appreciative of how the Company’s business and industry operates, Ramelius works
Ramelius listens to Aboriginal community representatives to understand their views and beliefs. Recognising that
towards increasing their understanding, respect and trust and to promote the Company’s obligations and economic
communities may not be fully appreciative of how the Company’s business and industry operates, Ramelius works
constraints amongst indigenous communities.
towards increasing their understanding, respect and trust and to promote the Company’s obligations and economic
Ramelius ensures that its employees and contractors approach the Company’s activities at local sites with respect and a
constraints amongst indigenous communities.
clear understanding of important issues and priorities.
Ramelius ensures that its employees and contractors approach the Company’s activities at local sites with respect and a
Communication and Commitment
clear understanding of important issues and priorities.
Ramelius adopts practical measures to develop trust. Acknowledging that community leaders and representatives have
Communication and Commitment
an obligation to consult its people to determine their opinions and wishes and that this may often not be achieved as
Ramelius adopts practical measures to develop trust. Acknowledging that community leaders and representatives have
quickly as is desired, Ramelius uses its best endeavours to expedite the process and ensure that its commercial interests
an obligation to consult its people to determine their opinions and wishes and that this may often not be achieved as
are not adversely impacted.
quickly as is desired, Ramelius uses its best endeavours to expedite the process and ensure that its commercial interests
The Company also uses its best endeavours to ensure reasonable rights of consultation and continued access to land are
are not adversely impacted.
facilitated and the integrity of land is preserved.
The Company also uses its best endeavours to ensure reasonable rights of consultation and continued access to land are
The Company is committed to taking appropriate steps to identify and reduce the effects of any unforeseen impacts
facilitated and the integrity of land is preserved.
from its activities.
The Company is committed to taking appropriate steps to identify and reduce the effects of any unforeseen impacts
from its activities.
Native vegetation in the Tanami area of Northern Territory
Native vegetation in the Tanami area of Northern Territory
38 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
SUSTAINABILITY STATEMENT
Ramelius Resources Limited
Sustainability Statement
The Ramelius Board of Directors maintains oversight of sustainability issues. Sustainability embraces how Ramelius
conducts business and includes workforce occupational health and safety, social responsibility to the general
community, minimising business operational impact on the environment and protecting the Company’s reputation as a
gold producer in Australia.
The following is a summary of how Ramelius deals with sustainability.
Workforce health and safety
Ramelius is committed to providing a healthy and safe environment for all employees and contractors. This is achieved
as follows.
Creating a culture that promotes health and safety in the best interests of all workforce participants;
Regular site safety meetings which encourage identification of issues and continual improvement;
Strict mine site entry procedures and requirements including enforcement of a drug and alcohol policy and
testing of site personnel;
Incident investigations and reporting to the Board;
Documented and regular review of emergency procedures and processes;
Ongoing staff training; and
Risk management.
Social responsibility
Ramelius endeavours to build and maintain a sustainable and diverse workforce focused on high performance. The
Company publically reports to shareholders and investors to ensure they are informed on corporate governance issues
and the entity’s approach to sustainability matters. The Company’s efforts in regards to social responsibility include the
following.
Maintaining and reviewing the Company’s diversity policy which encourages a workforce comprised of
individuals with diverse backgrounds, experiences, values and skills;
Encouraging staff training and ongoing professional development;
Acknowledgement of native title which promotes indigenous regard for land and respect of their culture,
traditions and cultural sites;
Engagement of shareholders and investors through presentations, roadshows and information booths at various
industry conferences;
Encouraging full participation of shareholders at the Annual General Meeting to ensure a high level of
accountability and identification with the Company’s strategy and goals; providing security holders with an on-
line voting facility to enable voting through a secure website or mobile device and providing the option to
receive and send communications electronically;
Identification and ongoing management of economic and other business related risks including the maintenance
of a risk register; and
Community support through sponsorships and donations.
Environmental protection
The Company has policies and procedures in place which aim to protect the environment. Ramelius seeks to comply
with legislative requirements and to promote a high regard for the environment in conducting its business. Key areas on
which Ramelius focuses to address this important sustainability issue are summarised below.
Environmental incidence documentation and reporting;
Addressing biodiversity issues as part of the Company’s planning for and conduct of exploration and mining
activities including flora and fauna studies, native vegetation recording and disturbed land restoration;
Conducting environmental impact studies and preparing reports thereon including rehabilitation measures for
government assessment as part of the process in seeking approval for proposed mining activities;
Undertaking appropriate waste product management activities including mine site sewage, tailings and other
hazardous materials, dust and general waste;
Landfill rehabilitation and conducting ongoing restoration wherever possible;
Maintaining a focus on the efficient use of resources including water and power;
Implementing water and other resource recycling measures; and
Facilitating environmental pollution audits and reporting.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 39
SUSTAINABILITY STATEMENT
Ramelius Resources Limited
Sustainability Statement
Water Resource Management
Ramelius conducts open pit and underground gold mining and processing at Mt Magnet and underground gold mining
at Vivien near Leinster in Western Australia where water management is an important and integral part of site
operations.
Mt Magnet Gold Project
The Mt Magnet Gold Project is located in the Murchison province of Western Australia, on the border of desert and
semi-desert Mediterranean climatic regions. Water availability can be scarce within these regions, particularly during
the hotter, drier summer months. Water for the operations is sourced largely from a number of disused open pits which
have filled with water over time. Utilising water from the disused pits reduces the operation’s reliance upon finite
groundwater resources; however, a small number of groundwater abstraction bores are also maintained to supplement
the water from these pits.
A number of diversion drains have been installed to divert surface water into these pits during periods of high rainfall
and these diversion drains have been installed in consultation with regulatory authorities.
The majority of water used is in the processing of ore at the Checker Mill (processing plant), with the remainder utilised
for dust suppression in surface mining areas and other incidental uses, such as offices and workshops. Water is also
sourced from the dewatering of actively mined open pits and underground workings. Water from ore processing
operations is recovered from the active tailings storage facility (TSF) and is recycled back through the processing plant.
The project is located upstream from the Genga water reserve, managed by the Department of Water & Environmental
Regulation (DWER), for the supply of water to the town of Mount Magnet, located to the south/south-west of the
current active mining areas. The key recharge area for the Genga borefield is located approximately 5.3 km from the
active mining areas. The wider Genga water reserve area, representing the surface water catchment area for the Genga
borefield, is managed as a Priority 2 water source protection area and this is located approximately 1.7 km from current
mining operations. Whilst previous hydrological studies by Ramelius and the DWER have determined that it’s unlikely
that the active mining areas contribute surface water recharge to the Genga water reserve; Ramelius is committed to
ensuring that mining operations do not impact upon the water quality or availability at the Genga borefield.
Site personnel actively monitor groundwater quality and levels at all abstraction points and at a number of regional
monitoring bores spread across the operation and also engage groundwater specialists to provide advice on the water
supply network and for assessing any potential impacts to ground and surface waters.
All statutory obligations are managed through annual reporting on the management of the Company’s operations
activities to regulators responsible for the environment and water across several licence jurisdictions. The Mt Magnet
Gold Project to date has not utilised the total volume allocation under its groundwater licence and always seeks where
possible to minimise the utilisation of groundwater.
Vivien Gold Project
The Vivien Gold Project is an underground operation located directly below an existing open pit. All surplus water, in
excess of site needs such as for dust suppression and mine services, is pumped to the Hidden Secret pit at Gold Fields’
Agnew gold mine approximately 8km away and used as process water for the Agnew processing plant. At mine
closure, it is anticipated the local groundwater level will recover to levels similar to those currently seen in the base of
the open pit.
40 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
DIVERSITY STATEMENT
Ramelius Resources Limited
Diversity Statement
Ramelius Resources Limited
Diversity Statement
Ramelius acknowledges that benefits flow from a workforce comprised of individuals with diverse backgrounds,
experiences, values and skills. The Company encourages recruitment based on qualifications, skills, abilities and merit
to ensure workforce vacancies are filled with the most suitable employees available. Ramelius also encourages personal
Ramelius acknowledges that benefits flow from a workforce comprised of individuals with diverse backgrounds,
development and training of employees to achieve their full potential for the mutual benefit of Ramelius and employees.
experiences, values and skills. The Company encourages recruitment based on qualifications, skills, abilities and merit
to ensure workforce vacancies are filled with the most suitable employees available. Ramelius also encourages personal
Workplace Gender Profile
development and training of employees to achieve their full potential for the mutual benefit of Ramelius and employees.
During the year, the Company updated its workplace gender profile as follows.
Workplace Gender Profile
During the year, the Company updated its workplace gender profile as follows.
WORKPLACE PROFILE
WORKPLACE PROFILE
Women
Men
Casual
%
Full
time
Women
Part
time
Full
time
Men
Part
time
Women Men Total
Staff
Casual
Women Men
%
Board*
Senior
Board*
Executives/KMP’s
Senior
Managers
Executives/KMP’s
Professional Staff
Managers
Technical Staff
Professional Staff
Community &
Technical Staff
Personal Service Staff
Community &
Clerical &
Personal Service Staff
Administrative Staff
Clerical &
Machinery Operators
Administrative Staff
and Drivers
Machinery Operators
Other
and Drivers
Total
Other
17
1
* Board includes Managing Director
Total
17
Full
time
Part
time
Full
4
time
4
4
Part
time
Women Men Total
4
Staff
4
4
1
4
1
2
4
2
2
2
6
6
1
1
1
4
10
21
10
33
21
1
33
1
1
1
24
24
1
99
1
99
1
1
2
2
3
3
1
6
1
3
6
3
2
2
1
13
1
13
4
12
33
12
40
33
4
40
4
12
12
27
27
3
139
3
139
1
2
1
1
2
1
3
3
7
7
Women Men
100.0
100.0
100.0
100.0
91.7
81.8
91.7
90.0
81.8
25.0
90.0
8.3
18.2
8.3
10.0
18.2
75.0
10.0
75.0
91.7
25.0
8.3
91.7
3.7
8.3
96.3
3.7
33.3
19.4
33.3
19.4
96.3
66.7
80.6
66.7
80.6
* Board includes Managing Director
Left to Right: John Dufall, Sarah Ferguson, Paul Marlow (behind), Danny Doherty, Gabe Crowe, Amanda Layther,
Kylie Spark, Daniel Rooks and George Munroe at the Vivien Gold Mine near Leinster, WA.
Left to Right: John Dufall, Sarah Ferguson, Paul Marlow (behind), Danny Doherty, Gabe Crowe, Amanda Layther,
Kylie Spark, Daniel Rooks and George Munroe at the Vivien Gold Mine near Leinster, WA.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 41
CORPORATE GOVERNANCE STATEMENT
Ramelius Resources Limited
Corporate Governance
Corporate Governance Statement
Left to Right: Non-Executive Directors Kevin Lines, Mike Bohm and Bob Kennedy (Chairman) with Managing
Director Mark Zeptner and Company Secretary Dom Francese
The Board of Directors is responsible for the overall Corporate Governance of the Company including strategic
direction, management goal setting and monitoring, internal control, risk management and financial reporting. In
discharging this responsibility, the Board seeks to take into account the interests of all key stakeholders of the
Company, including shareholders, employees, customers and the broader community.
Ramelius Resources Limited is committed to conducting its business with high standards of ethics and corporate
governance in the best interests of all stakeholders.
The 2017 Corporate Governance Statement of Ramelius Resources Limited has been lodged with the Australian
Securities Exchange Limited and is publically available from the investors section of the Company’s website at
www.rameliusresources.com.au
42 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
R A M E L I U S R E S O U R C E S L I M I T E D
ANNUAL FINANCIAL REPORT 2017
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 43
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
Your directors present their report on the consolidated entity consisting of Ramelius Resources Limited and the entities
it controlled at the end of, or during, the year ended 30 June 2017. Throughout the report, the consolidated entity is
referred to as the group.
Directors
The following persons were directors of Ramelius Resources Limited during the whole of the financial year and up to the
date of this report:
Robert Michael Kennedy
Mark William Zeptner
Kevin James Lines
Michael Andrew Bohm
Information on Directors
The following information is current as at the date of this report.
Robert Michael Kennedy
Qualifications
Independent Non‐Executive Chairman
KSJ, ASAIT, Grad. Dip (Systems Analysis), Dip Financial Planning, Dip Financial
Services, FCA, CTA, AGIA, Life member AIM, FAICD, MRSASA
Experience
Mr Kennedy is a Chartered Accountant and brings to the Board his expertise and
extensive experience as Chairman and Non‐Executive Director of a range of listed
public companies in the resources sector.
Interest in Shares and
Options
Special responsibilities
Directorships held in other
listed entities in the last three
years
10,350,789 Ordinary Shares.
Board Chairman, member of Audit & Risk Committee, and Nomination &
Remuneration Committee.
Chairman of Maximus Resources Limited, Monax Mining Limited, Tychean Resources
Limited and Non‐Executive Director of Flinders Mines Limited.
Previously a Non‐Executive Director of Crestal Petroleum Limited (formerly Tellus
Resources Limited and currently Firstwave Cloud Technology Limited) and Marmota
Energy Limited.
Mark William Zeptner
Qualifications
Managing Director
BEng (Hons) Mining, MAusIMM, MAICD.
Experience
Interest in Shares and Options
Mr Zeptner has more than 25 years’ industry experience including senior operational and
management positions with WMC and Gold Fields Limited at their major gold and nickel
assets in Australia and offshore. He joined Ramelius Resources Limited on 1 March 2012 as
the Chief Operating Officer, was appointed Chief Executive Officer on 11 June 2014 and
Managing Director effective 1 July 2015.
1,512,500 Ordinary Shares,
1,500,000 Options over Ordinary Shares exercisable at $0.299 expiring 11 June 2018,
1,500,000 Options over Ordinary Shares exercisable at $0.20 expiring 11 June 2019,
1,500,000 Options over Ordinary Shares exercisable at $0.20 vesting on 11 June 2018 and
expiring on 11 June 2020, and
500,000 Performance Rights over Ordinary Shares vesting on 11 June 2019 and expiring on 11
June 2026.
Special responsibilities
Chief Executive Officer.
Directorships held in other listed
entities in the last three years
None.
44 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
2
DIRECTORS’ REPORT
Kevin James Lines
Qualifications
Experience
Independent Non‐Executive Director
BSc (Geology), MAusIMM, MAICD.
Mr Lines is a geologist and has more than 35 years of experience in mineral exploration and
mining for gold, copper, lead, zinc and tin. He has held senior geological management
positions with Newmont Australia Limited, Normandy Mining Limited and the CRA group of
companies. He was the foundation Chief Geologist at Kalgoorlie Consolidated Gold Mines
where he led the team that developed the ore‐body models and geological systems for the
Super‐Pit Operations in Kalgoorlie and managed the Eastern Australian Exploration Division of
Newmont Australia Limited that included responsibility for the expansive tenement holdings
of the Tanami region. He brings to the Board his extensive experience in the assessment and
evaluation of exploration projects and development of properties and mining operations
overseas.
Interest in Shares and Options
1,000,000 Ordinary Shares.
Special responsibilities
Chairman of Audit & Risk Committee and member of Nomination & Remuneration
Committee.
Directorships held in other listed
entities in the last three years
None.
Michael Andrew Bohm
Qualifications
Independent Non‐Executive Director
B.AppSc (Mining Eng.), MAusIMM, MAICD.
Experience
Mr Bohm is a mining engineer with extensive corporate and operational management
experience in the minerals industry in Australia, South East Asia, Africa, Chile, Canada and
Europe. He is a graduate of the WA School of Mines and has worked as a mining engineer,
mine manager, study manager, project manager, project director and Managing Director. He
has been directly involved in a number of project developments in the gold, base metals and
diamond sectors in both open pit and underground mining environments.
Interest in Shares and Options
1,237,500 Ordinary Shares.
Special responsibilities
Chairman of Nomination & Remuneration Committee and member of Audit & Risk
Committee.
Directorships held in other listed
entities in the last three years
Director of ASX‐TSX listed Perseus Mining Limited & ASX listed Mincor Resources NL.
Previously a Director of ASX listed Tawana Resources NL and Berkut Minerals Limited.
Directors’ Meetings
The number of directors’ meetings (including meetings of Committees of directors) and number of meetings attended by
each of the directors of Ramelius during the financial year are:
Director
Mr R M Kennedy
Mr M W Zeptner
Mr K J Lines
Mr M A Bohm
Board of Directors
A
14
14
14
14
B
14
14
14
14
A Number of meetings attended
B Number of meetings held whilst a director
C Number of meetings held whilst a member
Audit & Risk
Committee
Nomination & Remuneration
Committee
A
6
n/a
6
6
C
6
n/a
6
6
A
6
n/a
6
6
C
6
n/a
6
6
3
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 45
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
Company Secretary
Domenico Antonio Francese BEc., FCA, FFin, AGIA, ACIS
Appointed Company Secretary on 21 September 2001. Mr Francese is a Chartered Accountant with an audit and
investigations background and more than 12 years’ experience in a regulatory and supervisory role with the ASX.
Principal Activities
The principal activities of the group during the year included exploration, mine development, mine operations and the
production and sale of gold. There were no significant changes in those activities during the year.
Operating and Financial Review
Financial Review
Financial performance
Sales revenue
Cash cost of production
Gross margin excluding “non‐cash” items
Amortisation and depreciation
Inventory movements and write‐downs
Gross Profit (Loss)
Profit before income tax
Income tax expense
Profit for the year from continuing operations
$M
$M
$M
$M
$M
$M
$M
$M
$M
Jun‐17
197.4
(119.0)
78.4
(60.0)
10.3
28.7
25.1
(7.4)
17.7
Jun‐16
173.7
(102.7)
71.0
(49.9)
11.8
32.9
25.3
2.4
27.7
Movement
23.7
(16.3)
7.4
(10.1)
(1.5)
(4.2)
(0.2)
(9.8)
10.0
Sales revenue
Sales revenue for the year ended 30 June 2017 increased by 14% to $197.4 million compared to $173.7 million reported
in the previous corresponding period for the continuing operation, mainly due to:
greater gold production sold, up 11% to 121,031 ounces compared to 108,711 ounces sold
greater average realised gold prices of A$1,628/oz, up 2% from the previous corresponding period
greater silver sales, up 25% from $0.24 million to $0.30 million
Sales revenue comparison ($M)
$173.7
$3.5
$20.1
Gold price
Production
$0.1
Silver
sales
$197.4
250
200
150
100
50
0
Jun‐16
Jun‐17
Note: Excludes sales revenue from discontinued operations
Profit after income tax from continuing operations
A profit after income tax was recorded for the year ended 30 June 2017 of $17.7 million, compared to a profit of $27.7
million in the previous corresponding. The gross profit was down on last year by $4.2 million primarily due to increased
costs of production which were offset by higher gold sales and average realised gold price. The higher tax expense in the
current year was because of a large tax benefit in the prior year due to $10.1 million of previously unrecognised tax losses
being recognised in 2016.
46 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
4
DIRECTORS’ REPORT
Cashflow
Net cash provided by operating activities for the year ended 30 June 2017 was $83.4 million compared to $65.5 million
in the prior year as a result of higher gold production and realised gold price. Net cash used in investing activities (which
included development and exploration activities) total $72.7 million for the year compared to $53.4 million in the prior
year. In July 2016, $25.0 million (before costs) was raised via the issuance of 50 million Ramelius shares at 50 cents per
share.
Cash on hand at the end of the financial year was $78.6 million, an increase of $34.3 million from the prior year.
Operations Review
Vivien mining area
The Vivien mining area performed well during the year and produced 37% of the group’s total fine gold production.
Area
Vivien
Operational commentary
Type
Underground Mining activity at Vivien continued throughout the year with ore extraction
commencing in the September 2016 quarter. Ore production and development
have progressed well throughout the year. Ore continues to be hauled to the
Checker processing facility at Mt Magnet and has been successfully blended with
both Kathleen Valley and Mt Magnet ore.
In December 2016 an updated resource model was generated resulting in a
significant improvement in the Resource. This led to an updated life of mine plan for
the Vivien Mine.
Mt Magnet mining area
Operations at Mt Magnet continued on a multi pit basis throughout the 2017 financial year. A summary of the areas in
operation is provided as follows:
Area
Titan
Type
Open Pit
Operational commentary
Initial mining of oxide and transition material saw high productivities with significant
low grade tonnages, additional to reserves, being identified and mined. A significant
jump in high grade ore production was achieved when operations reached the base
of the previous pit.
Mining is expected to continue into the second quarter of the 2018 financial year.
Perseverance
(Percy)
Open Pit
Produced the bulk of the ore in the early part of the year with grades performing
well although mining rates were lower due to working around stope voids.
Operations at the Perseverance pit concluded in February 2017.
Blackmans
Open Pit
Located 30km north of Mt Magnet.
Works commenced in September 2016 with initial ore haulage commencing in
November 2016. Mining operations at the Blackmans satellite pit concluded in the
June 2017 quarter with ore haulage and processing to continue into the September
2017 quarter.
Water Tank Hill
(WTH)
Underground Ore development commenced in early June 2017 with initial mill reconciled
production of 2,684 tonnes @ 7.19 g/t. Stoping production will commence in the
September 2017 quarter.
In conjunction with the Life of Mine (LoM) plan finalised in the June 2017 quarter, a tender process was conducted for
the open pit mining contract at Mt Magnet. Mining contractor MACA Mining Limited was the successful tenderer. MACA
commenced operations at the Milky Way and Stellar West open pits in July 2017. The incumbent mining contractor,
5
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 47
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
WATPAC Mining & Civil, will continue operations into the September 2017 quarter at the Titan and Brown Hill North pits
and see these pits through to completion.
Kathleen Valley mine
Mining activity at Kathleen Valley concluded late in the September 2016 quarter. Rehabilitation was carried out
concurrently with mining activities and therefore final rehabilitation work, other than ongoing monitoring, was also
completed. The Kathleen Valley project was very successful with recovered ounces of 65,244 being 22% higher than the
February 2015 Feasibility Study.
Processing
Processing at the Checker processing facility at Mt Magnet resulted in robust annual production, which exceeded
expectations during the 2017 financial year. The Burbanks processing facility was sold in the September 2016 quarter
after being on care and maintenance throughout the 2016 financial year.
Total group fine gold production increased by 13% to 125,488 ounces in the financial year compared to 110,839 ounces
in the previous corresponding period.
Production
Mt Magnet Segment
Total Production
Jun‐17
Jun‐16
Dry Tonnes
Milled (High
Grade)
1,913,954
1,913,954
Fine Gold
Production (oz)
Dry Tonnes Milled
(High Grade)
Fine Gold
Production (oz)
125,488
125,488
1,694,883
1,694,883
110,839
110,839
Group All‐In Sustaining Cost (AISC) averaged A$1,169 per ounce for the financial year which was below the average
realised gold price of A$1,628 per ounce over the same period.
Average Realised Gold Price v All‐In Sustaining Cost
A$/oz
1,604
1,464
1,600
1,630
1,257
1,168
1,661
915
1,800
1,700
1,600
1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
All‐In
Sustaining
Cost
Average
Realised
Gold Price
Sep‐16
Dec‐16
Mar‐17
Jun‐17
Development Projects
Cosmos Project (WA)
The Cosmos Project at Mt Magnet consists of the Milky Way, Stellar, Stellar West, and Shannon open pits plus the Brown
Hill and Vegas pits at the Galaxy area. The Cosmos area is located 3.6km south west of the Mt Magnet Checker Processing
Plant.
Ramelius has undertaken significant new drilling (including two geotechnical diamond holes), hydrological and
geotechnical studies, metallurgical test work, and density measurements. An external consultant was engaged for open
pit optimisation and design work with a Pre‐Feasibility study generated.
The Milky Way, Stellar, and Shannon pits were previously mined in the 1990’s with production from this area expected
to underpin the Mt Magnet operations over the next 2 – 3 years.
48 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
6
DIRECTORS’ REPORT
Approval for the Cosmos – Galaxy Mining Proposal was received from the Department of Mines and Petroleum (“DMP”)
(now the Department of Mines, Industry Regulation and Safety (DMIRS)) on the 13th June 2017 with mining at the Cosmos
area commencing in July 2017.
Morning Star Project (WA)
A new open pit resource model has been generated for Morning Star which incorporated a significant amount of new
drilling completed over the last 12 months. Geotechnical diamond drilling was also completed with pit optimisation and
design work on going. Work has commenced on the Mining Proposal with a view towards submission later in 2017.
Water Tank Hill (WA)
The Water Tank Hill project lies 1.5km west of Mt Magnet. The deposit is also located 300m west of the St George deposit
which was mined by open pit and then underground methods between 2004 and 2007. During the year final approvals
were received and operations commenced with ore haulage and processing commencing in the March 2017 quarter.
Exploration
Morning Star (WA)
A series of deeper RC drill holes were completed below the Morning Star pit to test for blind mineralised porphyry and/or
banded iron formation units away from the historically mined high grade lode positions. Highly encouraging results
continue to be returned from this exploration strategy.
Towards the end of the year, with the delineation of the revised open pit resource model for Morning Star, exploratory
RC drilling stepped away from the Morning Star and targeted depth / plunge extensions to the Nathan pit and other
shallow targets including Eclipse Ridge. Further drill testing is required to gauge the significance of drilling results to date.
Phase 1 of the drilling campaign at Morning Star Deeps is now complete after drilling 13 wedges off its parent diamond
hole (MSD0056) for an aggregate 7,208.7metres. The next stage will be spent compiling all the drill hole lithological,
alteration and structural data to generate a 3‐D litho‐structural model of the entire Morning Star system which will
provide the framework for future underground mineral resource modelling.
Black Cat (WA)
RC drilling targeted the saddle between the Morning Star Pit and the Black Cat South pit. Drilling is ongoing testing the
historically mined chert / banded iron hosted mineralisation’s as well as quartz veins.
Boogardie Basin (WA)
Regional Aircore drilling traverses over the Boogardie Basin commenced during the year targeting porphyry‐ultramafic
contacts in areas of ineffective historical drilling coverage as well as targeting shallow plus 100ppb (parts per billion) gold
in regolith anomalies and/or historical bottom of shallow RAB / Aircore anomalies where present. Several new target
areas including Zeus, Venus, Artemis, and Bundy Flats have been identified for follow up RC drilling.
Zeus Project (WA)
Exploration drilling adjacent to the Stellar West deposit has delineated significant quartz vein hosted gold mineralisation
along the western flank of the newly named Zeus Porphyry. The area became a focus for infill Aircore and deeper RC drill
testing with encouraging intersections. Deeper RC drilling returned broad intervals of anomalous gold mineralisation with
a blue quartz eye diorite porphyry intrusion. Infill drilling is required to better define continuity of the higher‐grade shoots
within the system.
Artemis Prospect (WA)
The Artemis Porphyry was tested by three Aircore traverses 400 to 600m apart. Historical drilling over this target area
has been too shallow to identify any gold anomalism. Follow up Aircore and RC drilling is planned.
Bundy Flats (WA)
At Bundy Flats encouraging intersections were returned with infill Aircore and RC drilling planned.
Tanami Joint Venture Gold Project (NT) ‐ Ramelius earning 85%
Reconnaissance drilling was completed during the year with disappointing results. The balance of the Tanami joint
venture ELA’s have been delayed pending heritage surveys which are expected to be completed before the 2018 field
season allowing further work following up other areas of gold anomalism identified from previous soil sampling programs.
7
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 49
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
Geological and regolith mapping occurred in the year over the Highland Rocks EL ahead of infill soil sampling over a
number of low order gold soil anomalies reported from the project in the prior year.
Coogee (WA)
Additional diamond drill holes were completed during the year with no significant results being recorded. In June 2017 a
binding term sheet for a Farm‐In and Joint Venture Agreement was executed. The term sheet allows for the third party
to earn up to an 80% joint venture interest by spending $2.1 million on the Coogee area over the next five years.
Kathleen Valley Gold Project (WA)
No significant results were returned for the Kathleen Valley gold project. A Tenement Sale Agreement for the sale of the
Kathleen Valley Project tenements (including 100% of the rare metal rights (lithium, tantalum, and associated metals))
was completed in December 2016. Under the Tenement Sale Agreement Ramelius retains 100% of the gold rights to the
tenement package and will continue to review any deeper gold exploration targets within the project.
Yandan Gold Project (QLD) – Ramelius 100%
Yandan North EPM is located 10km north and along strike of the abandoned Yandan gold mine which historically
produced over 350,000oz of gold. Results are awaited from a small, three‐hole diamond drilling programme completed
over the Yandan North EPM during the year.
Jupiter Farm‐in & Joint Venture (Nevada) – Ramelius earning 75%
Ramelius has executed a binding term sheet with Kinetic Gold (US) Inc, a wholly owned subsidiary of Renaissance Gold
Inc (TSX.V: REN). Ramelius may earn up to 75% interest in the Jupiter gold project, located in Nye County, Nevada USA,
by spending US$3 million within 5 years.
The project offers surface rock chip values up to 3.12 g/t Au. Ramelius intends to complete geological mapping, soil
sampling and detailed gravity surveys ahead of drill testing several Long Canyon analogous targets along the Cambrian –
Ordovician unconformity in three priority areas. The Long Canyon gold mine is owned and operated by Newmont and at
December 31, 2016 reported 1.2 million ounces of attributable gold reserves and 2.4 million ounces in resources (source:
www.newmont.com).
Corporate
The group finance team is in the process of being relocated from Adelaide, where it has been based since inception in
2003, to Perth alongside the operations and exploration teams. All corporate finance functions will be delivered out of
the Perth office, following full recruitment of the new team, expected by 1 September 2017. The Registered Office and
Company Secretarial function will remain in Adelaide.
To this end, Mr Tim Manners was appointed Chief Financial Officer effective 31 July 2017. Mr Manners replaces Mr Simon
Iacopetta who resigned to pursue Adelaide based opportunities.
Ramelius held forward gold sales contracts at 30 June 2017 totalling 102,000 ounces of gold at an average price A$1,711
per ounce.
In June 2017, the A$10M financing facility with the Commonwealth Bank of Australia (CBA) expired undrawn.
Dividends
Ramelius has not paid, declared or recommended a dividend in the current or preceding year.
Significant Changes in the State of Affairs
On 26th July 2016, Ramelius raised $25,000,000 from the issue of 50,000,000 shares at $0.50 per share to various
institutional investors.
There were no other significant changes in the state of affairs of the group that occurred during the financial year not
otherwise disclosed in this report or the consolidated financial statements.
50 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
8
DIRECTORS’ REPORT
Subsequent Events
No matter or circumstance has arisen since 30 June 2017 that has significantly affected the group’s operations, results,
or state of affairs, or may do so in the future.
Future Developments
In the 2018 financial year, Ramelius will continue its mining and gold production activities at Mt Magnet with a multi open
pit and underground operation incorporating the Titan, Brown Hill North, Milky Way, Stellar, and Stellar West open pits
and the Water Tank Hill underground project. Mining activities will also continue at the Vivien Gold Mine.
Exploration activities are mainly expected to be carried out at Mt Magnet and Vivien where further drilling is planned. In
addition to this, opportunities in the Tanami region (Northern Territory), Queensland, and the USA are being pursued.
Environmental Regulations and Performance
Regulations
The operations of the group in Australia are subject to environmental regulations under both Commonwealth and State
legislation. In the mining industry, many activities are regulated by environmental laws as they may have the potential
to cause harm and/or otherwise impact upon the environment. Therefore, the group conducts its operations under the
necessary State Licences and Works Approvals to carry out associated mining activities and operate a processing plant to
process mined resources. The group’s licences and works approvals are such that they are subject to audits both
internally and externally by the various regulatory authorities. These industry audits provide the group with valuable
information in regard to environmental performance and opportunities to further improve systems and processes, which
ultimately assist the business in minimising environmental risk.
Reporting
Due to the various licences and works approvals the group holds, annual environmental reporting (for a 12 month period)
is a licence and works approval condition. The group did not experience any reportable environmental incidents for the
reporting year 2016‐2017. Regulatory agencies requiring annual environmental reports are outlined below but are not
limited to the following:
Department of Water and Environment and Regulation (DWER);
Department of Mines, Industry Regulation and Safety (DMIRS);
Tenement Condition Report;
Native Vegetation Clearing Report;
Mining Rehabilitation Fund (MRF) Levy;
National Pollution Inventory (NPI); and
National Greenhouse and Energy Reporting (NGERS).
Sustainability
The group is committed to environmental performance and sustainability and works closely with the regulatory
authorities to achieve sustainability. Where the business can, continuous improvement processes are implemented to
improve the operation and environmental performance. The group seeks to build relationships with all stakeholders to
ensure that their views and concerns are taken into account in regard to decisions made about the operations, to achieve
mutually beneficial outcomes. This includes current operations, future planning and post closure activities.
Shares Under Option
Unissued ordinary shares of Ramelius under option at the date of this report are as follows:
Date Options Granted / Issued
16 April 2014
26 November 2015
26 November 2015
Vesting Date
11 June 2016
11 June 2017
11 June 2018
Expiry Date
11 June 2018
11 June 2019
11 June 2020
Exercise Price
0.299
0.200
0.200
Number Under
Option
1,500,000
1,500,000
1,500,000
No option holder has any right under the options to participate in any other share issue of the company or any other
entity.
9
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 51
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
Shares Issued on the Exercise of Options
The following ordinary shares of Ramelius were issued during the financial year ended 30 June 2017 as a result of the
exercise of options. No amounts are unpaid on any of the shares.
Effective Date Share Option Granted
16 April 2014
Expiry Date
11 June 2017
Exercise Price of Options
0.249
Ordinary Shares Issued
1,500,000
Indemnification and Insurance of Directors and Officers
Indemnification
Ramelius is required to indemnify its directors and officers against any liabilities incurred by the directors and officers
that may arise from their position as directors and officers of Ramelius and its controlled entities. No costs were incurred
during the year pursuant to this indemnity.
Ramelius has entered into deeds of indemnity with each director whereby, to the extent permitted by the Corporations
Act 2001, Ramelius agreed to indemnify each director against all loss and liability incurred as an officer of the Company,
including all liability in defending any relevant proceedings.
Insurance premiums
Since the end of the previous year Ramelius has paid insurance premiums in respect of directors’ and officers’ liability
and legal expenses insurance contracts. The terms of the policies prohibit disclosure of details of the amount of the
insurance cover, the nature thereof and the premium paid.
Proceedings on Behalf of Ramelius
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of Ramelius or to intervene in any proceedings to which Ramelius is a party, for the purpose of taking responsibility
on behalf of Ramelius for all or part of those proceedings. There were no such proceedings brought or interventions on
behalf of Ramelius with leave from the Court under section 237 of the Corporations Act 2001.
Non‐Audit Services
The company may decide to employ the auditor (Grant Thornton) on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the company and/or the group are important. Details of the
amounts paid or payable to the auditor for audit and non‐audit services provided during the year are set out below.
The Board of directors has considered the position, and in accordance with advice received from the Audit & Risk
Committee, is satisfied that the provision of the non‐audit services is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001. The directors are 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 have been reviewed by the Audit & Risk Committee to ensure they do not impact the impartiality
and objectivity of the auditor;
- none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants.
During the year the following fees were paid or payable for non‐audit services provided by the auditor of the parent
entity, its related practices and non‐related audit firms:
Non‐assurance services
Tax advice and compliance services
Other
Total
2017
2016
20,220
‐
20,220
7,000
580
7,580
Auditor Independence
A copy of the auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 follows
the Directors Report.
52 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
10
DIRECTORS’ REPORT
Remuneration Report (audited)
The directors are pleased to present your company’s remuneration report which sets out remuneration information for
the non‐executive directors, executive directors and other key management personnel of Ramelius. This remuneration
report forms part of the directors’ report. It outlines the overall remuneration strategy, framework and practices adopted
by Ramelius and its controlled entities for the period 1 July 2016 to 30 June 2017. The remuneration report has been
prepared in accordance with Section 300A of the Corporations Act 2001 and its regulations and is designated as audited.
In accordance with the Corporations Act 2001, remuneration details are disclosed for the group’s key management
personnel. The remuneration report:
- Details Board policies for determining remuneration of key management personnel,
- Specifies the relationship between remuneration policies and performance, and
- Identifies remuneration particulars for key management personnel.
Key management personnel
1.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling
major activities of the group, directly and indirectly, being the Ramelius directors and senior executives. Directors and
senior executives disclosed in this report are as follows:
Names
Directors of Ramelius
Mr R M Kennedy
Mr M W Zeptner
Mr K J Lines
Mr M A Bohm
Other senior executives
Mr D A Francese
Mr S Iacopetta
Mr D J Coutts
Mr K M Seymour
Position
Non‐Executive Chairman
Managing Director / Chief Executive Officer
Non‐Executive Director
Non‐Executive Director
Company Secretary
Chief Financial Officer
Chief Operating Officer
General Manager ‐ Exploration & Business Development
Changes since the end of the reporting period
Mr S Iacopetta resigned as Chief Financial Officer effective 31 July 2017.
Mr T Manners was appointed as Chief Financial Officer effective 31 July 2017.
Remuneration governance
2.
The Nomination & Remuneration Committee is a committee of the Board. It is primarily responsible for making
recommendations to the Board on:
- Non‐executive director fees;
- Executive remuneration (directors and senior executives); and
- The executive remuneration framework and incentive plan policies.
The objective of the Nomination & Remuneration Committee is to ensure that remuneration policies and structures are
fair and competitive and aligned with the long‐term interests of the Company. In performing its functions, the
Nomination & Remuneration Committee may seek advice from independent remuneration consultants.
During the year the Nomination & Remuneration Committee engaged Godfrey Remuneration Group Pty Limited
(Godfrey) to report on and provide recommendations on market competitiveness of non‐executive director remuneration
and the Chief Executive Officer remuneration profile, including short‐term incentives. Godfrey was paid $32,000 for these
services.
Godfrey has confirmed that any remuneration recommendations have been made free from undue influence by members
of the group’s key management personnel.
11
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 53
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
The following arrangements were made to ensure that the remuneration recommendations were free from undue
influence:
Godfrey was engaged by, and reported directly to, the chair of the Nomination & Remuneration Committee. The
agreement for the provision of remuneration consulting services was executed by the chair of the Nomination &
Remuneration Committee under delegated authority on behalf of the board;
The report containing the remuneration recommendations was provided by Godfrey directly to the chair of the
Nomination & Remuneration Committee; and
Godfrey was permitted to speak to management throughout the engagement to understand company processes,
practices and other business issues and obtain management perspectives. However, Godfrey was not permitted
to provide any member of management with a copy of their draft or final report that contained the remuneration
recommendations.
As a consequence, the board is satisfied that the recommendations were made free from undue influence from any
members of the key management personnel.
Executive remuneration policy and framework
3.
Ramelius has adopted a policy that aims to attract, motivate and retain a skilled executive team focused on contributing
to its objective of creating wealth and adding value for its shareholders. The remuneration framework is formed on this
basis. The remuneration framework is based on a number of factors including the particular experience and performance
of the individual in meeting key objectives of Ramelius.
The objective of the senior executive remuneration framework includes incentives that seek to encourage alignment of
management performance and shareholder interests. The framework aligns senior executive rewards with strategic
objectives and the creation of value for shareholders, and conforms to market practices for delivery of rewards.
In determining senior executive remuneration, the Board aims to ensure that remuneration practices are:
- Competitive and reasonable, enabling the company to attract and retain key talent,
- Aligned to the company’s strategic and business objectives and the creation of shareholder value,
- Acceptable to shareholders, and
- Transparent.
The senior executive remuneration framework is designed to ensure market competitiveness and achievement of the
remuneration objective. The remuneration of senior executives is:
- Benchmarked from time to time against similar organisations both within the industry and of comparable market size
to ensure uniformity with market practices;
- A reflection of individual roles, levels of seniority and responsibility that key personnel hold;
- Structured to take account of prevailing economic conditions; and
- A mix of fixed remuneration and at risk performance based elements using short and long‐term incentives.
The executive remuneration framework has three components:
- Base pay and benefits, including superannuation;
- Short‐term performance incentives; and
- Long‐term incentives through participation in the Employee Share Acquisition Plan, Performance Rights Plan and as
approved by the Board.
The combination of these comprises a senior executive’s total remuneration package. Incentive plans are regularly
reviewed to ensure continued alignment with financial and strategic objectives.
3.1 Remuneration framework
Ramelius remunerates its senior executives with a Total Reward Package (“TRP”) that consists of two components; Total
Fixed Remuneration and Total Variable Remuneration. Total Fixed Remuneration (“TFR”) comprises of base salary,
superannuation and other fixed executive benefits (such as salary sacrifice). Total Variable Remuneration (“TVR”)
comprises of Short Term Incentives (“STI”) and Long Term Incentives (“LTI”).
3.2 Executive remuneration mix
To ensure that senior executive remuneration is aligned to company performance, where appropriate, a portion of
selected senior executives’ target pay is “at risk”.
54 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
12
DIRECTORS’ REPORT
3.3 Base pay and benefits
Senior executives are offered a competitive base pay that comprises the fixed component of pay and rewards. When
required, external remuneration consultants are utilised to provide analysis and advice to ensure base pay reflects the
market for a comparable role.
Base pay for senior executives is reviewed annually in order to ensure pay remains competitive with the market. A senior
executive’s pay is also reviewed on promotion. There is no guaranteed base pay increase included in any senior executive
contracts. The Managing Director/Chief Executive Officer and senior executives may elect to salary sacrifice part of their
fixed remuneration for additional superannuation contributions and other benefits.
3.4 Short‐term incentives
Short‐term incentives (STI) are provided to certain executives under the direction of the Nomination & Remuneration
Committee. The Nomination & Remuneration Committee may recommend to the Board the payment of cash bonuses
from time to time in order to reward individual executive performance in achieving key objectives that are given high
levels of importance for the Company’s growth and profitability. To assist in this assessment, the Nomination &
Remuneration Committee receives recommendations from the Managing Director/Chief Executive Officer. This may
result in the proportion of remuneration related to performance varying between individuals. STI’s are established to
encourage the achievement of specific goals that are given high levels of importance in relation to growth and profitability
of Ramelius.
From August 2017, a structured set of KPI’s have be adopted for STI measurement which include i) Net profit after tax, ii)
Gold production compared to budget, iii) Reserve addition to Life of Mine Plan, and iv) All In Sustaining Cost (AISC)
compared to budget. These KPI’s are subject to Threshold, Target and Stretch hurdles, which may be modified downward
at the board’s discretion and modified down to zero in the event of serious safety and environmental breaches.
3.5 Long‐term incentives (LTI’s)
Long‐term incentives are provided via the Ramelius Performance Rights Plan, Employee Share Acquisition Plan as
approved by the Board. The LTI’s are designed to focus senior executives on delivering long‐term shareholder returns.
Performance Rights Plan
The Performance Rights Plan enables the Board to grant performance rights (being entitlements to shares in Ramelius
subject to satisfaction of vesting conditions) to selected key senior executives as a long‐term incentive as determined by
the Board in accordance with the terms and conditions of the plan. The plan provides selected senior executives the
opportunity to participate in the equity of Ramelius through the issue of rights as a long‐term incentive that is aligned to
the long‐term interests of shareholders.
Under the Performance Rights Plan, the number of rights granted to senior executives ranges up to 40% of the executive’s
total fixed remuneration (TFR) and is dependent upon each individual’s skills, responsibilities and ability to influence
financial or other key objectives of Ramelius. The number of rights granted is calculated by dividing the LTI remuneration
dollar amount by the volume weighted average price of Ramelius shares traded on the Australian Securities Exchange
during the 5 trading day period prior to the date of the grant.
The vesting and measurement period has previously been set over three years with vesting and measurement for each
third of the granted rights occurring at the end of each year during the three year period. From August 2017, the vesting
and measurement period has been set at three years.
Rights are subject to vesting conditions related to achievement of total shareholder returns (TSR) and period of service.
TSR performance is measured against the TSR of a benchmark peer group. The following companies have been identified
by Ramelius to comprise the peer group.
Company
Northern Star Resources Limited
Saracen Mineral Holdings Limited
Evolution Mining Limited
Regis Resources Limited
Silver Lake Resources Limited
Westgold Resources Limited
Doray Minerals Limited
ASX Code
NST
SAR
EVN
RRL
SLR
WGX
DRM
Company
Gold Road Resources Limited
Millennium Minerals Limited
Resolute Mining Limited
Dacian Gold Limited
Excelsior Gold Limited
St Barbara Limited
Blackham Resources Limited
ASX Code
GOR
MOY
RSG
DCN
EXG
SBM
BLK
13
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 55
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
The Nomination & Remuneration Committee may recommend to the Board to either include or exclude gold mining
organisations available on this list to reflect changes in the industry.
The proportion of senior executive rights that vest is dependent on how the Ramelius TSR compares to the peer group
as follows:
Relative TSR Over the Vesting and Measurement Period
Below the 50th percentile
At the 50th percentile
Between the 50th and 75th percentile
At and above the 75th percentile
Proportion of Performance Rights Vested
0%
50%
Pro‐rata between 50% and 100%
100%
Once vested, rights may be exercised within 7 years of the vesting date. During the year 3,572,692 performance rights
were granted to employees under the Performance Rights Plan. At the date of this report 379,351 performance rights
had been forfeited.
Of these performance rights granted 976,448 vested on 1 July 2017, all other performance rights issued during the year
had not vested at the date of this report.
Employee Share Acquisition Plan
The Employee Share Acquisition Plan enables the Board to offer eligible employees ordinary fully paid shares in Ramelius
as a long‐term incentive, in accordance with the terms of the plan. Shares may be offered at no consideration unless the
Board determines that market value or some other value is appropriate.
Other long‐term incentives
The Board may at its discretion provide share rights/options as a long‐term retention incentive to employees.
3.6 Share trading policy
The trading of shares is subject to, and conditional upon, compliance with the company’s employee share trading policy.
The policy is enforced through a system that includes a requirement that senior executive’s confirm compliance with the
policy and provide confirmation of dealings in Ramelius securities. The ability for a senior executive to deal with an option
or a right is restricted by the terms of issue and the plan rules which do not allow dealings in any unvested security. The
Share Trading Policy specifically prohibits an executive from entering into transactions that limit the economic risk of
participating in unvested entitlements such as equity based remuneration schemes. The Share Trading Policy can be
viewed on the Company’s website.
Relationship between executive remuneration and Company performance
4.
The following table shows key performance indicators for the group over the last five years:
Net profit (loss) after tax ($000)
Dividend / capital return ($000)
Share price 30 June ($)
Basic earnings per share (cents)
Diluted earnings per share (cents)
2017
17,765
‐
0.450
3.39
3.36
2016
27,540
‐
0.435
5.82
5.81
2015
16,068
‐
0.115
3.48
3.48
2014
(85,512)
‐
0.077
(23.8)
(23.8)
2013
(50,792)
‐
0.110
(15.1)
(15.1)
The total remuneration mix for the Managing Director/Chief Executive Officer and other senior executives and the key
links between remuneration and performance is detailed and explained according to each type of remuneration referred
to in the total remuneration mix below.
The following graph illustrates the total remuneration mix for senior executives shown separately for the Managing
Director/Chief Executive Officer and other executives.
56 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
14
DIRECTORS’ REPORT
2017 total remuneration mix
MD / CEO
57%
20%
23%
Other
executives
75%
13%
12%
0%
20%
40%
60%
80%
100%
Base pay & salaries
LTI
STI
4.1 Base pay and salaries
Base pay and salary levels have remained reasonably consistent with the remuneration mix in the prior year. Base pay
and salary levels are established in accordance with section 3.3 above.
4.2 Short term incentives
Short term incentives in the form of cash bonuses are paid to employees based on the operational achievements of the
organisation. Operational achievements epitomise the accomplishment of key milestones including production, financial
performance and cost management. These incentives are established in accordance with section 3.4 above.
4.3 Long term incentives
Long term incentives provided via the Ramelius Performance Rights Plan and Employee Share Acquisition Plan as
approved by the Board, are granted to employees based on the long term operational performance of the organisation
Long term incentives are established in accordance with section 3.5 above.
5. Non‐executive directors remuneration policy
Non‐executive director fees are determined using the following guidelines. Fees are:
- Determined by the nature of the role, responsibility and time commitment necessary to perform required duties;
- Not performance or incentive based but are fixed amounts; and
- Determined by the desire to attract a well‐balanced group of individuals with pertinent knowledge and experience.
In accordance with the Company’s Constitution, the total amount of remuneration of non‐executive directors is within
the aggregate limit of $550,000 per annum as approved by shareholders at the 2010 Annual General Meeting.
Non‐executive directors may apportion any amount up to this maximum level amongst the non‐executive directors as
determined by the Board. Remuneration consists of non‐executive director fees, committee fees and superannuation
contributions.
Non‐executive directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred
in performing their duties as directors. Non‐executive directors do not participate in any performance based pay
including schemes designed for the remuneration of senior executives, share rights or bonus payments and are not
provided with retirement benefits other than salary sacrifice and superannuation.
All Non‐Executive Directors enter into a service agreement with the company in the form of a letter of appointment. The
letter summarises the Board policies and terms, including remuneration, relevant to the office of director.
Voting and comments made at the company’s 2016 Annual General Meeting
6.
Of the total valid available votes lodged, Ramelius received 90% of “FOR” votes on its remuneration report for the 2016
financial year. The company did not receive any specific feedback at the AGM on its remuneration practices.
15
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 57
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
7. Details of remuneration
Details of remuneration fees paid to non‐executive directors are set out below:
Non‐Executive Directors
Mr R M Kennedy
Mr K J Lines
Mr M A Bohm
Total
Financial Year
2017
2016
2017
2016
2017
2016
2017
2016
Directors Fees
173,363
173,395
93,666
92,477
83,797
80,435
350,826
346,307
Superannuation Total Remuneration
190,699
190,734
103,033
101,725
100,913
99,605
394,645
392,064
17,336
17,339
9,367
9,248
17,116
19,170
43,819
45,757
Details of the remuneration package by value and by component for executive directors and other senior executives in
the current and previous reporting period are set out below:
Senior Executives
Mr M W Zeptner 2
2017
2016
Mr D A Francese 3
2017
2016
Mr S Iacopetta 4
2017
2016
Mr D J Coutts 5
2017
2016
Mr K M Seymour
2017
2016
Mr T J Blyth 6
2017
2016
Total
2017
2016
Short‐Term
Salary and
Fees
STI Cash
Bonus
Post‐
Employment
Super‐
annuation
Long‐Term
Benefits
Long Service
Leave
465,000
467,273
200,000
22,727
30,000
30,000
9,872
12,638
299,583
299,583
50,000
3,000
29,958
30,258
8,570
8,639
269,155
133,333
50,000
3,000
25,570
13,633
16,654
5,681
350,000
134,770
62,500
‐
35,000
13,477
‐
‐
251,000
260,000
50,000
3,000
35,000
26,300
4,950
10,356
‐
185,753
‐
20,000
‐
20,575
‐
1,499
1,634,738
1,480,712
412,500
51,727
155,528
134,243
40,046
38,813
Share‐Based
Payments 1
Termination
Benefits
Options
LTI
Rights
Total
136,249
102,801
38,881
‐
880,002
635,439
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
62,380
‐
450,491
341,480
41,587
‐
402,966
155,647
72,777
‐
520,277
148,247
54,063
‐
395,013
299,656
‐
‐
‐
227,827
136,249
102,801
269,688 2,648,749
‐ 1,808,296
‐
‐
‐
‐
‐
‐
‐
1 Rights and options relate to rights and options over ordinary shares issued to key management personnel. The fair value of rights and options
granted shown above is non‐cash and was determined in accordance with applicable accounting standards and represents the fair value calculated
at the time rights and options were granted and not when shares were issued
2 Mr M W Zeptner was appointed Managing Director effective 1 July 2015
3 Mr D A Francese ceased as Chief Financial Officer on 31 October 2015
4 Mr S Iacopetta was appointed Chief Financial Officer effective 1 November 2015 (resigned 31 July 2017)
5 Mr D J Coutts commenced employment with the company on 12 February 2016
6 Mr T Blyth ceased as key management personnel on 12 February 2016
58 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
16
DIRECTORS’ REPORT
The relative proportions of remuneration that are ‘at risk’ and those that are fixed are as follows:
Senior Executives
Financial Year
Fixed Remuneration
At Risk ‐ STI
At Risk ‐ LTI 1
Mr M W Zeptner 2
Mr D A Francese 3
Mr S Iacopetta 4
Mr D J Coutts 5
Mr K M Seymour
Mr T J Blyth 6
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
57.4%
80.2%
75.1%
99.1%
77.3%
98.1%
74.0%
100.0%
73.7%
99.0%
‐
91.2%
22.7%
3.6%
11.1%
0.9%
12.4%
1.9%
12.0%
‐
12.7%
1.0%
‐
8.8%
19.9%
16.2%
13.8%
‐
10.3%
‐
14.0%
‐
13.6%
‐
‐
‐
1 Since the LTI’s are provided exclusively by way of right and option, the percentages disclosed also reflect the value of remuneration consisting of
rights and options, based on the value of rights and options expensed in the year
2 Mr M W Zeptner was appointed Managing Director effective 1 July 2015
3 Mr D A Francese ceased as Chief Financial Officer on 31 October 2015
4 Mr S Iacopetta was appointed Chief Financial Officer effective 1 November 2015 (resigned 31 July 2017)
5 Mr D J Coutts commenced employment with the company on 12 February 2016
6 Mr T Blyth ceased as key management personnel on 12 February 2016
Service agreements
8.
Remuneration and other terms of employment for senior executives are formalised in service agreements. The service
agreements specify the components of remuneration, benefits and notice periods. Participation in short term and long
term incentives are at the discretion of the Board. Other major provisions of the agreements relating to remuneration
are set out below. Contracts with executives may be terminated early by either party as detailed below:
Name and Position
Mr M W Zeptner
Chief Executive Officer
Mr D A Francese
Company Secretary
Mr S Iacopetta
Chief Financial Officer
Mr D J Coutts
Chief Operating Officer
Mr K M Seymour
GM ‐ Business Development &
Exploration
Term of
Agreement
Base Salary incl.
Super 1
Company /
Employee Notice
Period
On‐going commencing
1 Jul 2015
On‐going commencing
1 Nov 2015
On‐going commencing
1 Nov 2015
On‐going commencing
12 Feb 2016
On‐going commencing
1 Jul 2009
$495,000
6 / 3 months
$329,541
6 / 3 months
$275,000
6 / 3 months
$385,000
6 / 3 months
$286,000
3 / 3 months
Termination
Benefit 2
6 months
base salary 3
6 months
base salary 3
6 months
base salary
3 months
base salary
3 months
base salary
1 Base salaries quoted are as at 30 June 2017, they are reviewed annually by the Nomination & Remuneration Committee
2 Termination benefits are payable on early termination by the company, other than for gross misconduct, unless otherwise indicated
3 In certain circumstances the termination benefit may be 12 months base salary
17
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 59
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
9. Details of share‐based compensation and bonuses
For grant of options or rights to deferred shares included in the remuneration tables above, the percentage of available
grant that was paid, or that vested, in the financial year, and the percentage forfeited because the person did not meet
the service and performance criteria is set out below in section 9.2 The minimum value of the rights yet to vest is nil, as
the rights will be forfeited if the key management persons fail to satisfy the vesting conditions. The maximum value of
the rights yet to vest has been determined as the amount of the grant date fair value of the rights that is yet to be
expensed.
9.1 Cash bonuses
Details of cash bonuses paid to key management personnel of the group are set out in Section 7 above. Cash bonuses
are paid at the discretion of the Board on achievement of key milestones that are important for the company. The cash
bonuses were paid as a short term incentive in December 2016 for reasons set out in Section 4 above. No cash bonuses
have since been paid or recommended.
9.2 Terms and Conditions of Share Based Payment Arrangements
Options
The terms and conditions of each grant of options affecting remuneration in the current or a future reporting period are
as follows:
Grant Date
26 November 2015
26 November 2015
Vesting and
Exercise Date
11 June 2017
11 June 2018
Expiry Date
11 June 2019
11 June 2020
Exercise Price
$0.200
$0.200
Value Per Option
at Grant Date
$0.087
$0.095
Vested
100%
n/a
Details of options over ordinary shares in the company provided as remuneration to key management personnel are
shown below. Options granted under the plan carry no dividend or voting right. When exercisable, each option is
convertible into one ordinary share of Ramelius. The options were provided at no cost to the recipients.
The assessed fair value at grant date of options granted to the individual is allocated equally over the period from grant
date to vesting date, and the amount is included in the remuneration tables above. Fair values at grant date are
determined using a Black‐Scholes option pricing model that takes into account the exercise price, the term of the option,
the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield and the risk free rate for the term of the option.
Performance Rights
The terms and conditions of each grant of performance right affecting remuneration in the current or a future reporting
period are as follows:
Grant Date
Vesting and
Exercise Date
Expiry Date
Exercise Price
23 November 2016 1
23 November 2016
23 November 2016
22 December 2016
1 July 2017
1 July 2018
1 July 2019
11 June 2019
1 July 2024
1 July 2025
1 July 2026
11 June 2026
$nil
$nil
$nil
$mil
1 These performance rights vested subsequent to the end of the financial year on 1 July 2017.
Value Per
Performance
Right at Grant
Date
$0.33
$0.32
$0.37
$0.36
Vested
0%
0%
0%
0%
Rights to deferred shares under the Performance Rights Plan are assessed against vesting criteria (and vested accordingly)
in July each year. One third of the performance rights granted vest one year from the grant date, another third vest two
years from the grant date, and the final third vest three years from the grant date. On vesting, each right must be
exercised within seven years of the vesting date. The performance rights carry no dividend or voting rights. If an employee
ceases employment before the performance rights vest, the rights will be forfeited, except in limited circumstances that
are approved by the board on a case‐by‐case basis.
As this is the first year in which the Performance Rights Plan has been in place the grant date for the first grant of
performance rights for valuation purposes is deemed to be the date on which the shareholders approved the
Performance Rights Plan. This approval occurred at the AGM held on 23 November 2016.
60 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
18
DIRECTORS’ REPORT
Reconciliation of options held by KMP
The table below shows a reconciliation of options held by each KMP from the beginning to the end of the 2017 financial
year. All vested options were exercisable.
2017
Name & grant dates
Mr M W Zeptner
16 April 2014
16 April 2014
26 November 2015
26 November 2015
Vested &
exercisable
1,500,000
1,500,000
‐
Balance at the start of the
year
Vested
Unvested
Number
%
Exercised
Balance at the end of the
year
Vested &
exercisable Unvested
‐
‐
1,500,000
1,500,000
‐
‐
1,500,000
‐
‐
‐
100
‐
(1,500,000)
‐
‐
‐
‐
1,500,000
1,500,000
‐
‐
‐
‐
1,500,000
The number of ordinary shares in the company provided as a result of the exercise of remuneration options to key
management personnel during the financial year is shown below.
Key Management Personnel
Date Options
Exercised
Ordinary Shares
Issued on Exercise of
Options
Exercise Price per
share
Value of Options at
Exercise Date 1
Mr M W Zeptner
8 Jun 2017
1,500,000
$0.24689
$256,965
1 The value at the date of exercise of options that were granted as part of remuneration and exercised during the year has been determined as the
intrinsic value of the options at the exercise date
Reconciliation of performance rights held by KMP
The table below shows a reconciliation of performance rights held by each KMP from the beginning to the end of the
2017 financial year.
2017
Name & grant dates
Balance at the start of
the year
Vested
Exercised
Vested &
Unvested
Number
Mr M W Zeptner
22 December 2016
Mr D A Francese
23 November 2016
Mr S Iacopetta
23 November 2016
Mr D J Coutts
23 November 2016
Mr K M Seymour
23 November 2016
‐
‐
‐
‐
‐
500,000
303,413
202,276
353,982
262,958
‐
‐
‐
‐
‐
%
‐
‐
‐
‐
‐
Reconciliation of ordinary shares held by KMP
‐
‐
‐
‐
‐
Balance at the end of
the year
Vested
Unvested
‐
‐
‐
‐
‐
500,000
303,413
202,276
353,982
262,958
2017
Name
Mr R M Kennedy
Mr M W Zeptner
Mr K J Lines
Mr M A Bohm
Mr D A Francese
Mr S Iacopetta
Mr D J Coutts
Mr K M Seymour
Received
during the
year on the
exercise of
options
‐
1,500,000
‐
‐
‐
‐
‐
‐
Balance at
the start of
the year
10,350,789
2,037,500
1,000,000
1,037,500
1,314,922
280,000
‐
224,860
Acquisition
of shares
Disposal of
shares
‐
‐
‐
200,000
‐
‐
‐
‐
‐
2,025,000
‐
‐
‐
‐
‐
‐
Balance at
the end of
the year
10,350,789
1,512,500
1,000,000
1,237,500
1,314,922
280,000
‐
224,860
19
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 61
ANNUAL FINANCIAL REPORT 2017
DIRECTORS’ REPORT
Loans to key management personnel
There were no loans made to key management personnel or their personally related parties during the current or prior
period.
Other transactions with key management personnel
Lease payments were made during the year to an entity related to the Chairman, Mr R M Kennedy. The lease agreement
is for the office property in Adelaide, SA and has been based on normal commercial terms on conditions on an arm’s
length basis.
Aggregate amounts of each of the above types of transactions with key management personnel of Ramelius Resources
Limited:
Amounts recognised as an expense
Rent of office building
Amounts recognised as current other debtors
Security deposit on premises
2017
$
2016
$
97,749
93,816
13,935
13,935
The Chairman, Mr R M Kennedy, is the Chairman of Maximus Resources Limited. During the year Ramelius Resources
Limited entered into a Share Sale Agreement with Maximus Resources Limited for the sale of Ramelius Milling Services
Pty Limited (the owner and operator of the Burbanks Mill). The Share Sale Agreement was made on normal commercial
terms and conditions on an arm’s length basis.
Amounts recognised as other receivables
Current
Non ‐ current
Remuneration report ends.
2017
$
450,000
1,286,217
2016
$
‐
‐
Rounding of Amounts
Ramelius Resources Limited is a type of company referred to in ASIC Corporations (Rounding in Financial/Directors’
Reports) Instrument 2016/191 and therefore the amounts contained in this report and in the financial report have been
rounded to the nearest $1,000, or in certain cases, to the nearest dollar.
The directors’ report, incorporating the remuneration report is signed in accordance with a resolution of the Board of
directors.
____________________
Robert Michael Kennedy
Chairman
Adelaide 24 August 2017
62 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
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a
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RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 63
ANNUAL FINANCIAL REPORT 2017
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2017
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2017
Sales revenue
Cost of production
Gross profit
Other expenses
Sales revenue
Other income
Cost of production
Operating profit before interest income and finance cost
Gross profit
Interest income
Other expenses
Finance costs
Other income
Profit before income tax
Operating profit before interest income and finance cost
Income tax (expense) benefit
Interest income
Profit for the year from continuing operations
Finance costs
Profit before income tax
Profit (loss) for the year from discontinued operations
Profit for the year
Income tax (expense) benefit
Profit for the year from continuing operations
Profit (loss) for the year from discontinued operations
Earnings per share (cents per share)
Profit for the year
Basic earnings per share
- Continuing operations
- Discontinued operations
Earnings per share (cents per share)
Total basic earnings per share
Basic earnings per share
Diluted earnings per share
- Continuing operations
- Continuing operations
- Discontinued operations
- Discontinued operations
Total basic earnings per share
Total diluted earnings per share
Diluted earnings per share
- Continuing operations
- Discontinued operations
Total diluted earnings per share
Note
5(a)
5(b)
Note
5(c)
5(a)
5(d)
5(b)
5(e)
5(c)
5(e)
5(d)
7
5(e)
5(e)
32
7
32
8
8
8
8
8
8
8
8
2017
$000’s
2016
$000’s
197,358
(168,615)
2017
28,743
$000’s
(5,946)
197,358
1,790
(168,615)
24,587
28,743
1,154
(5,946)
(681)
1,790
25,060
24,587
(7,418)
1,154
17,642
(681)
25,060
33
17,675
(7,418)
17,642
173,744
(140,839)
2016
32,905
$000’s
(7,303)
173,744
7
(140,839)
25,609
32,905
568
(7,303)
(834)
7
25,343
25,609
2,422
568
27,765
(834)
25,343
(225)
27,540
2,422
27,765
33
17,675
(225)
27,540
3.38
0.01
3.39
3.38
3.35
0.01
0.01
3.39
3.36
3.35
0.01
3.36
5.87
(0.05)
5.82
5.87
5.86
(0.05)
(0.05)
5.82
5.81
5.86
(0.05)
5.81
The above Consolidated Income Statement should be read in conjunction with the accompanying notes
22
64 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
22
The above Consolidated Income Statement should be read in conjunction with the accompanying notes
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Profit for the year
Other comprehensive income, net of tax
Items that may be reclassified to profit or loss:
Change in fair value of available‐for‐sale assets
Other comprehensive income for the year, net of tax
Profit for the year
Total comprehensive income for the year
Other comprehensive income, net of tax
Items that may be reclassified to profit or loss:
Change in fair value of available‐for‐sale assets
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
2017
$000’s
2016
$000’s
17,675
27,540
2017
$000’s
(280)
(280)
17,675
2016
$000’s
(202)
(202)
27,540
17,395
27,338
(280)
(280)
(202)
(202)
17,395
27,338
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes
23
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 65
23
ANNUAL FINANCIAL REPORT 2017
CONSOLIDATED BALANCE SHEET
FOR THE YEAR ENDED 30 JUNE 2017
CONSOLIDATED BALANCE SHEET
FOR THE YEAR ENDED 30 JUNE 2017
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other assets
Current assets
Assets and disposal group classified as held for sale
Cash and cash equivalents
Total current assets
Trade and other receivables
Inventories
Non‐current assets
Other assets
Other receivables
Assets and disposal group classified as held for sale
Other assets
Total current assets
Available‐for‐sale financial assets
Property, plant and equipment
Non‐current assets
Development assets
Other receivables
Intangible assets
Other assets
Exploration and evaluation expenditure
Available‐for‐sale financial assets
Deferred tax assets
Property, plant and equipment
Total non‐current assets
Development assets
Total assets
Intangible assets
Exploration and evaluation expenditure
Current liabilities
Deferred tax assets
Trade and other payables
Total non‐current assets
Provisions
Total assets
Liabilities included in disposal group held for sale
Total current liabilities
Current liabilities
Trade and other payables
Non‐current liabilities
Provisions
Provisions
Liabilities included in disposal group held for sale
Deferred tax liabilities
Total current liabilities
Total non‐current liabilities
Total liabilities
Non‐current liabilities
Net assets
Provisions
Deferred tax liabilities
Equity
Total non‐current liabilities
Share capital
Total liabilities
Reserves
Net assets
Retained profits
Total equity
Equity
Share capital
Reserves
Retained profits
Total equity
Note
9
10
Note
11
12
32
9
10
11
12
10
32
12
13
14
15
10
16
12
17
13
7
14
15
16
17
7
18
19
32
18
19
19
32
7
19
7
20
21
20
21
2017
$000’s
2016
$000’s
78,567
2017
1,914
$000’s
29,231
891
‐
78,567
110,603
1,914
29,231
891
1,286
‐
412
110,603
292
19,239
53,455
1,286
‐
412
19,101
292
30,944
19,239
124,729
53,455
235,332
‐
19,101
30,944
22,398
124,729
2,714
235,332
‐
25,112
22,398
2,714
21,429
‐
18,989
25,112
40,418
65,530
169,802
21,429
18,989
40,418
149,122
65,530
920
169,802
19,760
169,802
149,122
920
19,760
169,802
44,272
2016
1,836
$000’s
18,947
868
3,225
44,272
69,148
1,836
18,947
868
‐
3,225
526
69,148
132
20,539
60,634
‐
73
526
7,784
132
35,410
20,539
125,098
60,634
194,246
73
7,784
35,410
22,255
125,098
3,392
194,246
2,070
27,717
22,255
3,392
22,336
2,070
16,605
27,717
38,941
66,658
127,588
22,336
16,605
38,941
125,080
66,658
423
127,588
2,085
127,588
125,080
423
2,085
127,588
The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes
24
66 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
24
The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017
Share
capital
$000’s
Share‐based
payment
reserve 1
$000’s
Available‐
for‐sale
reserve 1
$000’s
Asset
revaluation
reserve 1
$000’s
Retained
profit (loss)
$000’s
Total
equity
$000’s
Share
124,251
capital
$000’s
‐
‐
‐
124,251
Share‐based
payment
2,545
reserve 1
$000’s
‐
‐
‐
2,545
Available‐
for‐sale
(93)
reserve 1
$000’s
‐
(202)
(202)
(93)
Asset
revaluation
634
reserve 1
$000’s
‐
‐
‐
634
Retained
(28,033)
profit (loss)
$000’s
27,540
‐
27,540
(28,033)
Balance at 30 June 2015
‐
‐
‐
‐
‐
117
(2,578)
84
‐
‐
‐
117
‐
(2,578)
‐
84
‐
832
‐
(3)
‐
‐
‐
125,080
832
(3)
‐
‐
‐
‐
‐
125,080
Profit for the year
Other comprehensive income
Total comprehensive income
Balance at 30 June 2015
Transactions with owners in their
Profit for the year
capacity as owners:
Share capital
Other comprehensive income
Transaction costs net of tax
Total comprehensive income
Share‐based payments
Transfer of reserves 2
Transactions with owners in their
capacity as owners:
Balance at 30 June 2016
Share capital
Transaction costs net of tax
Profit for the year
Share‐based payments
Other comprehensive income
Transfer of reserves 2
Total comprehensive income
Balance at 30 June 2016
Transactions with owners in their
Profit for the year
capacity as owners:
Share capital
Other comprehensive income
Transaction costs net of tax
Total comprehensive income
Share‐based payments
Transactions with owners in their
Balance at 30 June 2017
capacity as owners:
Share capital
1 Refer Note 21 for description of reserves.
Transaction costs net of tax
2 Represents the portion of share based payments which have either expired or vested.
Share‐based payments
Balance at 30 June 2017
‐
25,373
‐
(1,331)
‐
‐
149,122
25,373
(1,331)
‐
149,122
‐
‐
‐
‐
‐
777
861
‐
‐
777
861
‐
‐
(202)
‐
(202)
‐
‐
(295)
‐
‐
‐
‐
(280)
‐
(280)
(295)
‐
‐
(280)
‐
(280)
‐
(575)
‐
‐
‐
(575)
‐
‐
‐
‐
‐
‐
‐
634
‐
‐
‐
‐
‐
‐
‐
634
‐
‐
‐
‐
‐
‐
634
‐
‐
‐
634
27,540
‐
‐
‐
27,540
‐
2,578
2,085
‐
‐
17,675
‐
‐
2,578
17,675
2,085
17,675
‐
‐
‐
17,675
‐
19,760
‐
‐
‐
19,760
Total
99,304
equity
$000’s
27,540
(202)
27,338
99,304
27,540
832
(202)
(3)
27,338
117
‐
127,588
832
(3)
17,675
117
(280)
‐
17,395
127,588
17,675
25,373
(280)
(1,331)
17,395
777
169,802
25,373
(1,331)
777
169,802
1 Refer Note 21 for description of reserves.
2 Represents the portion of share based payments which have either expired or vested.
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes
25
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes
25
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 67
ANNUAL FINANCIAL REPORT 2017
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2017
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2017
Cash flows from operating activities
Receipts from operations
Payments to suppliers and employees
Interest received
Finance costs
Cash flows from operating activities
Net cash provided by (used in) discontinued operations
Receipts from operations
Net cash provided by operating activities
Payments to suppliers and employees
Interest received
Cash flows from investing activities
Finance costs
Payment for derivatives
Net cash provided by (used in) discontinued operations
Payments for property, plant and equipment
Net cash provided by operating activities
Payments for development
Proceeds from sale of property, plant and equipment
Cash flows from investing activities
Proceeds from the sale of subsidiary
Payment for derivatives
Payments for available‐for‐sale financial assets
Payments for property, plant and equipment
Payments for mining tenements and exploration
Payments for development
Payments for site rehabilitation and demobilisation
Proceeds from sale of property, plant and equipment
Net cash used in investing activities
Proceeds from the sale of subsidiary
Payments for available‐for‐sale financial assets
Cash flows from financing activities
Payments for mining tenements and exploration
Repayment of borrowings
Payments for site rehabilitation and demobilisation
Proceeds from issue of shares
Net cash used in investing activities
Transaction costs from issue of shares
Net cash provided by (used in) financing activities
Cash flows from financing activities
Repayment of borrowings
Net increase in cash and cash equivalents
Proceeds from issue of shares
Transaction costs from issue of shares
Cash at beginning of financial year
Net cash provided by (used in) financing activities
Effects of exchange rate changes on cash held
Net increase in cash and cash equivalents
Cash and cash equivalents at end of financial year
Cash at beginning of financial year
Note
2017
$000’s
2016
$000’s
Note
25 (b)
25 (b)
25 (a)
197,589
2017
(115,160)
$000’s
1,189
(280)
92
197,589
83,430
(115,160)
1,189
(280)
(80)
92
(4,850)
83,430
(52,407)
5
527
(80)
(15)
(4,850)
(14,840)
(52,407)
(946)
5
(72,606)
527
(15)
(14,840)
‐
(946)
25,373
(72,606)
(1,902)
23,471
‐
34,295
25,373
(1,902)
44,272
23,471
‐
34,295
78,567
44,272
176,288
2016
(111,027)
$000’s
531
(116)
(160)
176,288
65,516
(111,027)
531
(116)
(186)
(160)
(5,152)
65,516
(43,104)
1
‐
(186)
‐
(5,152)
(4,795)
(43,104)
(203)
1
(53,439)
‐
‐
(4,795)
(1,062)
(203)
832
(53,439)
(4)
(234)
(1,062)
11,843
832
(4)
32,425
(234)
4
11,843
44,272
32,425
Effects of exchange rate changes on cash held
‐
4
Cash and cash equivalents at end of financial year
25 (a)
78,567
44,272
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes
26
68 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
26
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
The financial report of Ramelius Resources Limited for the year ended 30 June 2017 was authorised for issue in
accordance with a resolution of the directors on 24 August 2017. Ramelius Resources Limited is a listed public company,
incorporated and domiciled in Australia whose shares are publicly listed on the Australian Securities Exchange Limited
(ASX).
Summary of Significant Accounting Policies
1
The principal accounting policies adopted in the preparation of this financial report are presented below. These policies
have been consistently applied to all years presented, unless otherwise stated. This annual financial report includes the
consolidated financial statements and notes of Ramelius Resources Limited and its controlled entities.
a) Basis of preparation and statement of compliance
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standard Board (AASB) and the Corporations Act 2001. Ramelius is a
for‐profit entity for the purposes of preparing the financial statements. The financial report has been presented in
Australian dollars and rounded to the nearest $1,000 unless otherwise stated.
Compliance with IFRS
(i)
The consolidated financial statements of the group also comply with International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standards Board (IASB).
Historical cost convention
(ii)
These financial statements have been prepared under the historical cost convention, as modified by the revaluation of
available‐for‐sale financial assets, financial assets and liabilities at fair value through profit and loss and certain classes of
property, plant and equipment.
New and amended standards adopted by the group
(iii)
There were no material new and revised standards which were effective for annual periods beginning on or after 1 July
2016 that were adopted by the group.
New standards and interpretations not yet adopted
(iv)
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2017
reporting periods and have not been early adopted by the group. The group’s assessment of the impact of these new
standards and interpretations is set out below.
AASB 9 Financial Instruments (December 2014)
AASB 9 Financial Instruments addresses the classification, measurement and derecognition of financial assets and
financial liabilities and introduces new rules for hedge accounting. In December 2014, the AASB made further changes
to the classification and measurement rules and also introduced a new impairment model. These latest amendments
now complete the new financial instruments standard. This standard does not apply mandatorily for reporting periods
beginning before 1 January 2018. A preliminary assessment undertaken by management suggests that adoption of this
amendment will not result in a material impact on the Group’s financial statements.
AASB 15 Revenue from Contracts with Customers
AASB 15 replaces AASB 118 Revenue and AASB 111 Construction Contracts. The new standard is based on the principle
that revenue is recognised when control of a good or service transfers to a customer ‐ so the notion of control replaces
the existing notion of risks and rewards. The standard permits a modified retrospective approach for the adoption. Under
this approach entities will recognise transitional adjustments in retained earnings on the date of initial application, i.e.
without restating the comparative period. They will only need to apply the new rules to contracts that are not completed
as of the date of initial application. This standard does not apply mandatorily for reporting periods beginning before 1
January 2018. A preliminary assessment undertaken by management suggests that adoption of this amendment will not
result in a material impact on the Group’s financial statements
27
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 69
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
AASB 16 Leases
AASB 16 replaces AASB 117 Leases and some lease related Interpretations. The new standard requires all leases to be
accounted for as ‘on‐balance sheet’ by lessees, other than short term and low value asset leases. The standard provides
new guidance on the application of the definition of lease and on sale and lease back accounting. The standard also
requires new and different disclosures about leases. This standard does not apply mandatorily before 1 January 2019.
Adoption of this amendment will not result in a material impact on the Group’s financial statements.
AASB 2016‐2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107
AASB 2016‐2 amends AASB 107 Statement of Cash Flows to require entities preparing financial statements in accordance
with Tier 1 reporting requirements to provide disclosures that enable users of financial statements to evaluate changes
in liabilities arising from financing activities, including both changes arising from cash flows and non‐cash changes.
When these amendments are first adopted for the year ending 30 June 2018, there will be no material impact on the
financial statements.
AASB 2016‐5 Amendments to Australian Accounting Standards – Classification and Measurement of Share based Payment
Transactions
This Standard amends AASB 2 Share‐based Payment to address: a.) The accounting for the effects of vesting and non‐
vesting conditions on the measurement of cash‐settled share‐based payments; b.) The classification of share‐based
payment transactions with a net settlement feature for withholding tax obligations; and c.) The accounting for a
modification to the terms and conditions of a share‐based payment that changes the classification of the transaction
from cash‐settled to equity‐settled.
When these amendments are first adopted for the year ending 30 June 2019, there will be no material impact on the
financial statements
Critical accounting estimates
(v)
The preparation of financial statements requires the use of certain accounting estimates. It also requires management
to exercise its judgement in the process of applying the group’s accounting policies. The areas involving a higher degree
of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are
disclosed in Note 4.
b) Principles of consolidation
The consolidated financial statements incorporate the financial statements of the parent entity, Ramelius Resources
Limited, and its controlled entities (referred to as the ‘consolidated group’ or ‘group’ in these financial statements). A list
of controlled entities is contained in Note 28 to the consolidated financial statements. All controlled entities have a 30
June financial year end.
Subsidiaries
(i)
Subsidiaries are all entities over which the group has control. The group controls an entity when the group is exposed to,
or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through
its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is
transferred to the group. They are deconsolidated 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 an impairment of the transferred asset.
Accounting policies of subsidiaries are consistent with those adopted by the group.
Changes in ownership interests
(ii)
When the group ceases to have control, any retained interest in the entity is remeasured to its fair value with the change
in carrying amount recognised in profit or loss. This fair value becomes the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an associate, joint venture 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. If the ownership interest in a joint venture or an associate is
reduced but joint control or significant influence is retained, only a proportionate share of the amounts previously
recognised in other comprehensive income are reclassified to profit or loss where appropriate.
70 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
28
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
c) Joint arrangements
Under AASB 11 Joint Arrangement investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal
structure of the joint arrangement. Ramelius has exploration related joint arrangements which are considered joint
operations. Ramelius recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and
its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the
financial statements under the appropriate headings. Details of the joint operations are shown in Note 29.
d) 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 Managing Director/Chief Executive Officer.
Functional and presentation currency
e) Foreign currency
(i)
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 consolidated financial statements are presented in Australian
dollars ($), which is Ramelius Resources Limited and its controlled entities functional and presentation currency.
Transactions and balances
(ii)
Transactions in foreign currencies are initially recorded in the functional currency at exchange rates prevailing at the date
of the transaction. The subsequent payment or receipt of funds related to a transaction is translated at the rate applicable
on the date of payment or receipt. Monetary assets and liabilities denominated in foreign currencies are translated at
the rate of exchange at the reporting date. Non‐monetary items that are measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value was determined. Translation differences on assets
and liabilities carried at fair value are reported as part of the fair value gain or loss.
All exchange differences in the consolidated financial report are taken to the Income Statement.
Group companies
(iii)
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation currency are translated into the presentation currency as
follows:
assets and liabilities for each Balance Sheet presented are translated at the closing rate at the date of that
Balance Sheet,
income and expenses for each income statement and statement of comprehensive income are translated at
average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at the dates of the
transactions), and
all resulting exchange differences are recognised in other comprehensive income.
f) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue from sale of goods or
rendering of a service is recognised upon delivery of the goods or service to customers as this corresponds to the transfer
of significant risks and rewards of ownership of the goods and the cessation of all involvement with those goods.
Revenue from gold bullion and silver sales is brought to account when the significant risks and rewards of ownership have
transferred to the buyer and selling prices are known or can be reasonably estimated.
Interest revenue is recognised as it is accrued using the effective interest rate method.
All revenue is stated net of goods and services tax (GST).
g) Government grants
Grants from the government are recognised at their fair value when there is a reasonable assurance that the grant will
be received and the group complies with the attached conditions. Government grants relating to exploration and
evaluation expenditure are recognised against the exploration and evaluation asset to match the grants with the costs
that the grants are intended to compensate.
29
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 71
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
h) Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a
qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their
intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
Other borrowing costs are expensed in the period in which they are incurred.
Income tax
i)
The income tax expense (benefit) for the year comprises current income tax expense (benefit) and deferred tax expense
(benefit). Current and deferred income tax expense (benefit) is charged or credited directly to equity instead of the profit
or loss when the tax relates to items that are credited or charged directly to equity.
Current income tax
(i)
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable
income tax rates that have been enacted, or substantially enacted by the reporting date. Management periodically
evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretations. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered
from) the relevant taxation authority.
Deferred income tax
(ii)
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year
as well as unused tax losses.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have
been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial
recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable
profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset
is realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their
measurement also reflects the manner in which management expects to recover or settle the carrying amount of the
related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is
probable that future taxable profits will be available against which the benefits of the deferred tax asset can be utilised.
The amount of benefits brought to account or which may be realised in the future is based on the assumption that no
adverse change will occur in income tax legislation and the anticipation that the group will derive sufficient future
assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the
law.
Tax consolidated group
(iii)
Ramelius Resources Limited and its wholly‐owned Australian subsidiaries have formed an income tax consolidated group
under tax consolidation legislation. Each entity in the group recognises its own current and deferred tax assets and
liabilities. Such taxes are measured using the ‘stand‐alone taxpayer’ approach to allocation.
Current tax liabilities (assets) and deferred tax assets arising from unused tax losses and tax credits in the subsidiaries are
immediately transferred to the head entity.
The tax consolidated group has entered into a tax funding arrangement whereby each company in the group contributes
to the income tax payable by the group in proportion to their contribution to the group’s taxable income. Differences
between the amounts of net tax assets and liabilities derecognised and the net amounts recognised pursuant to the
funding arrangement are recognised as either a contribution by, or distribution to the head entity.
72 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
30
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
j) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of goods and services tax, unless the GST incurred is
not recoverable from the Australian Tax Office (ATO). In these circumstances the GST is recognised as part of the cost
of acquisition of the asset or as part of the expense.
Receivables and payables are stated in the Consolidated Balance Sheet inclusive of GST. The net amount of GST
recoverable from, or payable to, the ATO is included as a current asset or liability in the Consolidated Balance Sheet.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing and financing
activities which are recoverable from, or payable to, the ATO are classified as operating cash flows. Commitments and
contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
k) Cash and cash equivalents
Cash and cash equivalents in the Consolidated Balance Sheet comprise cash at bank, demand deposits held with banks,
other short‐term highly liquid investments that are readily convertible to known amounts of cash and which are subject
to an insignificant risk of changes in values. For the purposes of the Consolidated Statement of Cash Flows, cash and cash
equivalents consist of cash and cash equivalents as defined above.
l) Trade and other receivables
Trade receivables comprising bullion awaiting settlement are initially recorded at the fair value of contracted sale
proceeds expected to be received only when there is a passing of significant risks and rewards of ownership to the
customer. Collectability of debtors is reviewed on an ongoing basis. Receivables which are known to be uncollectible are
written off and an allowance account (provision for impairment of trade receivables) is raised where objective evidence
exists that the debt will not be collected. Other receivables are initially measured at fair value then amortised at cost,
less an allowance for impairment.
m) Inventories
Gold ore, gold in circuit and poured gold bars are physically measured or estimated and valued at the lower of cost and
net realisable value. Cost represents the weighted average cost incurred in converting ore into finished goods and
includes direct costs and an appropriate allocation of fixed and variable production overhead costs, including depreciation
and amortisation.
By‐products inventory on hand obtained as a result of the gold production process are valued at the lower of cost and
net realisable value. Consumables and stores are valued at the lower of cost and net realisable value. Costs of purchased
inventory are determined after deducting any applicable rebates and discounts. A periodic review is undertaken to
establish the extent of any surplus or obsolete items and where necessary a provision is made.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion
of sale.
Gold ore represents stockpiled ore that has been mined or otherwise acquired and is available for further processing. If
there is significant uncertainty as to whether the stockpiled ore will be processed, it is expensed. Where future processing
of ore can be predicted with confidence (e.g. it exceeds the mine cut off grade), it is valued at the lower of cost and net
realisable value. If ore is not expected to be processed within 12 months after reporting date, it is classified as non‐
current assets. Ramelius believes processing ore stockpiles may have a future economic benefit to the group and
accordingly ore is valued at lower of cost and net realisable value.
n) Property, plant and equipment
Cost
Each class of plant and equipment is carried at cost or fair value as indicated less, where applicable, any accumulated
depreciation and impairment losses.
Properties are shown at fair value based on valuations by external independent valuers, less subsequent depreciation for
buildings. Any accumulated depreciation at the date of revaluation is eliminated against the carrying amount of the asset
and the net amount is restated to the revalued amount of the asset. All other plant and equipment are stated at historical
cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
The net carrying amount of property, plant and equipment is reviewed for impairment in accordance with Note 1(u).
31
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Major spares purchased specifically for particular plant are capitalised and depreciated on the same basis as the plant to
which they relate when in use. Assets are depreciated or amortised from the date they are installed and are ready for
use, or in respect of internally constructed assets, from the time the asset is completed and deemed ready for use.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with the item will flow to the group and the cost of the item can
be measured reliably. All other repairs and maintenance are charged to the Income Statement during the financial period
in which they are incurred.
Depreciation
Items of plant and equipment are depreciated on a straight line basis over their estimated useful lives, the duration of
which reflects the useful lives depending on the nature of the asset. The group uses the straight line method when
depreciating property, plant and equipment, resulting in estimated useful lives for each class of depreciable assets as
follows:
Class of fixed asset
Properties
Plant and equipment – mine camp
Plant & equipment – mill refurbishments
Plant & equipment – tailings dam
Plant & equipment – computers
Plant & equipment – office equipment
Plant & equipment – office furniture
Plant & equipment – other
Mine and exploration equipment
Motor vehicles
Useful life
40 years
2 ‐ 15 years
5 years
5 years
4 years
3 – 10 years
10 – 25 years
2.5 – 25 years
2 ‐ 33.3 years
8 ‐ 12 years
Estimates of remaining useful lives and depreciation methods are reviewed bi‐annually for all major items of plant and
equipment. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains
and losses are included in the Income Statement. When revalued assets are sold, amounts included in the revaluation
reserve relating to that asset are transferred to retained earnings.
o) Leases
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and
requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets
and the arrangement conveys the right to use the asset.
Leases of plant and equipment under which the group assumes substantially all the risks and benefits incidental to
ownership are classified as finance leases. Other leases are classified as operating leases.
Finance leases are capitalised, with a lease asset and a lease liability equal to the fair value of the leased asset, or if lower,
at the present value of the minimum lease payments determined at the inception of the lease. Lease payments are
apportioned between the finance charges and reduction of the lease liability. The finance charge component within the
lease payments is expensed. Capitalised leased assets are depreciated over the shorter of the estimated useful life of the
asset and the lease term if there is no reasonable certainty that the group will obtain ownership by the end of the lease
term.
Payments made under operating leases are expensed on a straight line basis over the leased term, except where an
alternative basis is more representative of the pattern of benefits to be derived from the leased property.
74 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
32
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
p) Exploration, evaluation and feasibility expenditure
Exploration and evaluation
Exploration and evaluation costs related to areas of interest are capitalised and carried forward to the extent that:
(i) Rights to tenure of the area of interest are current; and
(ii) a) Costs are expected to be recouped through successful development and exploitation of the area of interest or
alternatively by sale; or
b) Where activities in the area of interest have not yet reached a stage which permits a reasonable assessment of
the existence or otherwise of economically recoverable reserves, active and significant operations in, or in
relation to, the areas are continuing.
Such expenditure consists of an accumulation of acquisition costs and direct net exploration and evaluation costs incurred
by or on behalf of the group, together with an appropriate portion of directly related overhead expenditure.
Deferred feasibility
Feasibility expenditure represents costs related to the preparation and completion of feasibility studies to enable a
development decision to be made in relation to an area of interest and is capitalised as incurred.
When production commences, relevant past exploration, evaluation and feasibility expenditure in respect of an area of
interest that has been capitalised is transferred to mine development where it is amortised over the life of the area of
interest to which it relates on a unit‐of‐production basis, refer Note 1(r).
When an area of interest is abandoned or the directors decide it is not commercial, any accumulated costs in respect of
that area are written off in the year the decision is made. Each area of interest is reviewed at the end of each reporting
period and accumulated costs written off to the extent they are not expected to be recoverable in the future.
q) Mineral rights
Mineral rights comprise identifiable exploration and evaluation assets, mineral resources and ore reserves, which are
acquired as part of a business combination or a joint venture and are recognised at fair value at date of acquisition.
Mineral rights are attributable to specific areas of interest and are classified within exploration and evaluation assets.
Mineral rights attributable to each area of interest are amortised when commercial production commences on a unit‐of‐
production basis over the estimated economic reserve of the mine to which the rights related.
r) Mine development
Development assets represent expenditure in respect of exploration, evaluation, feasibility and development incurred by
or on behalf of the group, including overburden removal and construction costs, previously accumulated and carried
forward in relation to areas of interest in which mining has now commenced. Such expenditure comprises net direct
costs and an appropriate allocation of directly related overhead expenditure.
All expenditure incurred prior to commencement of production from each development property is carried forward to
the extent to which recoupment out of future revenue from the sale of production, or from the sale of the property, is
reasonably assured.
When further development expenditure is incurred in respect of a mine property after commencement of production,
such expenditure is carried forward as part of the cost of the mine property only when future economic benefits are
reasonably assured, otherwise the expenditure is classified as part of the cost of production and expensed as incurred.
Such capitalised development expenditure is added to the total carrying value of development assets being amortised.
Amortisation and impairment
Development assets are amortised based on the unit‐of‐production method which results in an amortisation charge
proportional to the depletion of the estimated recoverable reserves. Where there is a change in the reserves the
amortisation rate is adjusted prospectively in the reporting period in which the change occurs. The net carrying values
of development expenditure carried forward are reviewed half‐yearly by directors to determine whether there is any
indication of impairment, refer Note 1(u).
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
s) Deferred mining expenditure
Pre‐production mine development
Pre‐production mining costs incurred by the group in relation to accessing recoverable reserves are carried forward as
part of ‘development assets’ when future economic benefits are established, otherwise such expenditure is expensed as
part of the cost of production.
Surface mining costs
Mining costs incurred during the production stage of operations are deferred as part of determining the cost of
inventories. This is generally the case where there are fluctuations in deferred mining costs over the life of the mine, and
the effect is material. The amount of mining costs deferred is based on the ratio obtained by dividing the amount of
waste mined by the quantity of gold ounces contained in the ore. Mining costs incurred in the period are deferred to the
extent that the current period waste to contained gold ounce ratio exceeds the life‐of‐mine waste‐to‐ore (life‐of‐mine)
ratio. The life‐of‐mine ratio is based on economically recoverable reserves of the operation.
The life‐of‐mine ratio is a function of an individual mine’s design and therefore changes to that design will generally result
in changes to the ratio. Changes in other technical or economic parameters that impact reserves will also have an impact
on the life‐of‐mine ratio even if they do not affect the mine’s design. Changes to the life‐of‐mine ratio are accounted for
prospectively.
In the production stage of some operations, further developments of the mine require a phase of unusually high
overburden removal activity that is similar in nature to pre‐production mine development. The costs of such unusually
high overburden removal activity are deferred and charged against reported profits in subsequent periods on a unit‐of‐
production basis. The accounting treatment is consistent with that of overburden removal costs incurred during the
development phase of a mine, before production commences.
Deferred mining costs that relate to the production phase of the operation are carried forward as part of ‘development
assets’. The release of deferred mining costs is included in site operating costs.
t) Intangible assets
Costs incurred in acquiring software are capitalised as intangible assets. Costs capitalised include external costs of
materials and services. Costs associated with administration and maintenance of software is expensed as incurred in
other expenses in the Income Statement. Amortisation is calculated on the useful life, ranging from 3 to 5 years.
u) Impairment of non‐financial assets
The carrying amounts of all non‐financial assets are reviewed half‐yearly to determine whether there is an indication of
impairment. Where an indicator of impairment exists, a formal estimate of the recoverable amount is made. The
recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared
to the asset’s carrying value. For the purposes of assessing impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or
groups of assets (cash‐generating units). Any excess of the asset’s carrying value over its recoverable amount is expensed
as an impairment loss to the Income Statement. Non‐financial assets other than goodwill that suffered impairment are
reviewed for possible reversal of the impairment at the end of each reporting period.
v) Available‐for‐sale assets
The group’s investments are designated as available‐for‐sale financial assets. The group’s investments in listed securities
are initially measured at fair value. Subsequent to initial recognition, available‐for‐sale financial assets are measured at
fair value with gains or losses being recognised as a separate component of equity until the investment is derecognised
or until the investment is determined to be impaired, at which time the cumulative gain or loss previously reported in
equity is recognised in the Income Statement. Impairment losses on equity instruments that were recognised in profit
or loss are not reversed through profit or loss in a subsequent period. The fair value of listed equity securities are
determined by reference to quoted market prices.
w) Trade and other payables
Liabilities for trade and other payables are initially recorded at the fair value of the consideration to be paid in the future
for goods and services received, whether or not billed to the group, and then subsequently at amortised cost.
76 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
34
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
x) Employee benefits
Wages, salaries, salary at risk, annual leave and sick leave
Liabilities arising in respect of wages and salaries, salary at risk, annual leave and any other employee benefits expected
to be wholly settled within 12 months of the reporting date are measured at their nominal amounts based on
remuneration rates which are expected to be paid when the liabilities are settled. These amounts are recognised in ‘trade
and other payables’ (for amounts other than annual leave and salary at risk) and ‘current provisions’ (for annual leave
and salary at risk) in respect of employee services up to the reporting date. Costs incurred in relation to non‐accumulating
sick leave are recognised when the leave is taken and are measured at the rate paid or payable.
Long service leave
The liability for long service leave is measured at the present value of the estimated future cash outflows to be made by
the group resulting from employees’ services provided up to the reporting date. Liability for long service leave benefits
not expected to be settled within 12 months are discounted using the rates attaching to high quality corporate bonds at
the reporting date, which most closely match the terms of maturity of the related liability. In determining the liability for
these long term employee benefits, consideration has been given to expected future increases in wage and salary rates,
the groups experience with staff departures and periods of service. Related on‐costs have also been included in the
liability.
Provision is made for the group’s liability for employee benefits arising from services rendered by employees to reporting
date. Employee benefits that are expected to be settled within one year are measured at the amounts expected to be
paid when the liability is settled, plus related on‐costs. Employee benefits payable later than one year are measured at
the present value of the estimated future cash outflows to be made for those benefits. Consideration is given to expected
future wage and salary levels, experience of employee departures and periods of service. Those cash flows are discounted
using market yields on high quality corporate bonds with terms to maturity that match the expected timing of cash flows.
The obligations are presented as current liabilities in the Balance Sheet if the entity does not have an unconditional right
to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is
expected to occur.
Defined contribution superannuation plans
Contributions to defined contribution superannuation plans are expensed when incurred.
Share‐based payments
The group provides benefits to employees (including the executive director/chief executive officer) in the form of share‐
based compensation, whereby employees render services in exchange for shares or options and/or rights over shares
(equity‐settled transactions).
The cost of these equity‐settled transactions with employees is measured by reference to the fair value of the equity
instruments at the date at which they are granted. The group issues share‐based remuneration in accordance with the
employee share acquisition plan, the performance rights plan or as approved by the Board as follows:
(i) Employee share acquisition plan
The group operates an Employee Share Acquisition Plan where employees may be issued shares and/or options.
Fair value of the equity to which employees become entitled is measured at grant date and recognised as an
employee benefits expense over the vesting period with a corresponding increase in equity. Fair value of shares
issued is determined with reference to the latest ASX share price. Options are valued using an appropriate valuation
technique which takes vesting conditions into account.
(ii) Performance rights plan
The group has a Performance Rights Plan where key management personnel may be provided with rights to shares
in Ramelius. Fair values of rights issued are recognised as an employee benefits expense over the relevant service
period, with a corresponding increase in equity. Fair value of rights are measured at effective grant date and
recognised over the vesting period during which key management personnel become entitled to the rights. There
are a number of different methodologies that are appropriate to use in valuing rights. Fair value of rights granted
is measured using the most appropriate method in the circumstances, taking into consideration the terms and
conditions upon which the rights were issued.
35
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(iii) Other long‐term incentives
The Board may at its discretion provide share rights either to recruit or as a long‐term retention incentive to key
executives and employees.
The fair value of options and/or rights granted is recognised as an employee benefits expense with a corresponding
increase in equity. The total amount to be expensed is determined by reference to the fair value of the options and/or
rights granted, which includes any market performance conditions and the impact of any non‐vesting conditions but
excludes the impact of any service and non‐market performance vesting conditions.
Non‐market vesting conditions are included in assumptions about the number of options that are expected to vest. The
total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions
are to be satisfied. At the end of each period, the entity revises its estimates of the number of options and/or rights that
are expected to vest based on the non‐market vesting conditions. It recognises the impact of the revision to original
estimates, if any, in profit or loss, with a corresponding adjustment to equity.
Upon exercise of the rights, the balance of the Share‐Based Payments Reserve relating to those rights remains in the
share‐based payments reserve until it is transferred to retained earnings.
Termination benefits
Termination benefits are payable when employment is terminated by the group before the normal retirement date, or
when an employee accepts voluntary redundancy in exchange for these benefits. The group recognises termination
benefits at the earlier of the following dates: (a) when the group can no longer withdraw the offer of those benefits; and
(b) when the entity recognises costs for a restructuring that is within the scope of AASB 137 and involves the payment of
terminations benefits. In the case of an offer made to encourage voluntary redundancy, the termination benefits are
measured based on the number of employees expected to accept the offer. Benefits falling due more than 12 months
after the end of the reporting period are discounted to present value.
y) Provisions
Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
Provision for restoration and rehabilitation
Estimated costs of decommissioning and removing an asset and restoring the site are included in the cost of the asset as
at the date the obligation first arises and to the extent that it is first recognised as a provision. The group records the
present value of the estimated cost of constructive and legal obligations to restore operating locations in the period in
which the obligation is incurred. The nature of decommissioning activities includes dismantling and removing structures,
rehabilitating mine sites, dismantling operating facilities, closure of plant and waste sites and restoration, reclamation
and revegetation of affected areas.
Typically, the obligation arises when the asset is installed or the environment is disturbed at the development location.
When the liability is initially recorded, the present value of the estimated cost is capitalised by increasing the carrying
amount of the related mining assets. Over time, the discounted liability is increased for the change in the present value
based on the discount rates that reflect the current market assessments and the risks specific to the liability. Additional
disturbances or changes in decommissioning costs will be recognised as additions or changes to the corresponding asset
and rehabilitation liability when incurred.
The unwind effect of discounting the provision is recorded as a finance cost in the Income Statement and the carrying
amount capitalised as a part of mining assets is amortised on a unit‐of‐production basis. Costs incurred that relate to an
existing condition caused by past operations, but do not have future economic benefits are expensed as incurred.
78 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
36
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
z) Financial instruments
Initial recognition and measurement
Financial instruments are initially measured at fair value plus transaction costs except where the instrument is classified
‘at fair value through profit or loss’ in which case transaction costs are expensed immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at fair value, amortised cost using the effective interest rate method
or at cost. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. Quoted prices in an active market are used to
determine fair value where possible. The group does not designate any interest in subsidiaries, associates or joint venture
entities as being subject to the requirements of accounting standards specifically applicable to financial instruments.
(i) Loans and receivables
Loans and receivables are non‐derivative financial assets with fixed or determinable payments that are not quoted
in an active market and are subsequently measured at amortised cost using the effective interest rate method.
(ii) Financial liabilities
Non‐derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
(iii) Derivative financial instruments
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently
remeasured to their fair value at the end of each reporting period. The group uses derivative financial instruments
to hedge its exposure to changes in commodity prices arising in the normal course of business. The group does not
trade in derivatives for speculative purposes. Derivative financial instruments are recognised at fair value on the
date a derivative contract is entered into. Derivatives are valued on a mark‐to‐market valuation and the gain or loss
on re‐measurement to fair value is recognised through the Income Statement.
(iv) Available‐for‐sale financial assets
Available‐for‐sale financial assets include any financial assets not included in the above categories. The group’s
accounting policy for available‐for‐sale financial assets is discussed at Note 1(v).
Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to
determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar
instruments and option pricing models.
Impairment
At each reporting date, the group assesses whether there is objective evidence that a financial instrument has been
impaired. If there is objective evidence of impairment, the cumulative loss ‐ measured as the difference between the
acquisition cost and the current fair value, less any impairment loss on that financial asset previously not recognised in
the profit or loss, is removed from equity and recognised in profit or loss.
aa) Derivative activity
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently
remeasured to their fair value at the end of each reporting period. Changes in the fair value of any derivative instrument
(which does not qualify for hedge accounting) are recognised immediately in profit or loss and are included in other
income or other expenses.
bb) Share capital
Ordinary share capital is classified as equity and is recognised at fair value of the consideration received by the group.
Any transaction costs arising on the issue of ordinary shares and the associated tax are recognised directly in equity as a
reduction of the share proceeds received.
37
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
cc) Earnings per share
Basic earnings per share is calculated by dividing:
- the profit attributable to owners of the company, adjusted to exclude costs of servicing equity other than ordinary
shares,
- by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the year.
Diluted earnings per share adjusts the figures used in determining 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,
- weighted average number of additional ordinary shares that would have been outstanding assuming the
conversion of all dilutive potential ordinary shares.
-
dd) Non‐current assets and liabilities classified as held for sale and discontinued operations
When the Group intends to sell a non‐current asset or a group of assets (a disposal group), and if sale within twelve (12)
months is highly probable, the asset or disposal group is classified as ‘held for sale’ and presented separately in the
Balance Sheet. Liabilities are classified as ‘held for sale’ and presented as such in the Balance Sheet if they are directly
associated with a disposal group.
Assets classified as ‘held for sale’ are measured at the lower of their carrying amounts immediately prior to their
classification as held for sale and their fair value less costs to sell. However, some ‘held for sale’ assets such as financial
assets or deferred tax assets, continue to be measured in accordance with the Group's accounting policy for those assets.
Once classified as ‘held for sale’, the assets are not subject to depreciation or amortisation. Any profit or loss arising from
the sale or re‐measurement of discontinued operations is presented as part of a single line item, profit or loss from
discontinued operations.
ee) Parent entity information
The financial information of the parent entity, Ramelius Resources Limited, disclosed in Note 31 has been prepared on
the same basis as the consolidated financial statements, other than investments in controlled entities which were carried
at cost less impairment.
ff) Rounding of amounts
Ramelius Resources Limited is a type of company referred to in ASIC Corporations (Rounding in Financial/Directors’
Reports) Instrument 2016/191 and therefore the amounts contained in the financial report have been rounded to the
nearest $1,000, or in certain cases, to the nearest dollar.
Financial Risk Management Policies
2
The group’s management of financial risk is aimed at ensuring cash flows are sufficient to:
- Withstand significant changes in cash flow at risk scenarios and meet all financial commitments as and when they fall
due; and
- Maintain the capacity to fund future project development, exploration and acquisition strategies.
The group continually monitors and tests its forecast financial position against these criteria.
The group is exposed to the following financial risks: liquidity risk, credit risk and market risk (including foreign exchange
risk, commodity price risk and interest rate risk).
80 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
38
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
The directors are responsible for monitoring and managing financial risk exposures of the group. The group holds the
following financial instruments:
Financial assets
Cash at bank
Term deposits
Trade and other receivables (including refundable deposits)
Available‐for‐sale financial assets
Total financial assets
Financial liabilities
Trade and other payables
Total financial liabilities
2017
$000’s
2016
$000’s
71,752
6,815
3,612
292
82,471
35,781
8,491
2,362
132
46,766
22,398
22,398
22,255
22,255
a) Liquidity risk
Liquidity risk arises from the possibility that the group might encounter difficulty in settling its debts or otherwise meeting
its obligations related to financial liabilities. Prudent liquidity risk management implies maintaining sufficient cash to meet
obligations when due. The group manages liquidity risk by regularly monitoring forecast cash flows.
i. Maturities of financial liabilities
(a)
Payables
Trade and other payables are expected to be settled within 6 months.
(b) Borrowings
The group has no outstanding borrowings as at 30 June 2017.
b) Credit risk exposures
Credit risk represents the loss that would be recognised if counterparties failed to perform as contracted. The credit risk
on financial assets of the entity which have been recognised in the Consolidated Balance Sheet is the carrying amount,
net of any provision for doubtful debts. Credit risk is managed through the consideration of credit worthiness of
customers and counterparties. This ensures to the extent possible, that customers and counterparties to transactions are
able to pay their obligations when due and payable. Such monitoring is used in assessing impairment.
Past due but not impaired
i.
As at 30 June 2017, there were no trade or other receivables considered past due but not impaired (2016: nil).
Impaired trade receivables
ii.
Individual receivables which are known to be uncollectable are written off by reducing the carrying amount directly. The
other receivables are assessed to determine whether there is objective evidence that an impairment has been incurred
but not yet identified. For these receivables, the estimated impairment losses are recognised in a separate provision for
impairment. The group considers that there is evidence of impairment if any of the following indicators are present:
significant financial difficulties of the debtor,
probability that the debtor will enter bankruptcy or financial reorganisation, and
default or delinquency in payments (past due)
Receivables for which an impairment provision was recognised are written off against the provision when there is no
expectation of recovering additional cash. Impairment losses are recognised in profit or loss within other expenses.
Subsequent recoveries of amounts previously written off are credited against other expenses.
39
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ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Foreign currency risk
c) Market risk
i.
The group undertakes transactions impacted by foreign currencies; hence exposures to exchange rate fluctuations arise.
The majority of the group’s revenue is affected by movements in USD:AUD exchange rate that impacts on the Australian
gold price whereas the majority of costs (including capital expenditure) are in Australian dollars. The group considers the
effects of foreign currency risk on its financial position and financial performance and assesses its option to hedge based
on current economic conditions and available market data.
Commodity price risk
ii.
The group’s revenue is exposed to commodity price fluctuations, in particular to gold prices. Price risk relates to the risk
that the fair value of future cash flows of gold sales will fluctuate because of changes in market prices largely due to
demand and supply factors for commodities. The group is exposed to commodity price risk due to the sale of gold on
physical delivery at prices determined by market at the time of sale. The group manages commodity price risk as follows:
Forward sales contracts
Gold price risk is managed through the use of forward sales contracts which effectively fix the Australian Dollar gold price
and thus provide cash flow certainty.
Put options
Gold price risk may be managed with the use of hedging strategies through the purchase of gold put options to establish
gold “floor prices” in Australian dollars over the group’s gold production; however, this is generally at levels lower than
current market prices. These put options enable Ramelius to retain full exposure to current, and any future rises in the
gold price while providing protection to a fall in the gold price below the strike price. Gold put options are marked to
market at fair value through profit and loss.
Gold prices, cash flows and economic conditions are constantly monitored to determine whether to implement a hedging
program. At 30 June 2017, the group had 102,000 ounces in forward sales contracts at an average price of A$1,711. Refer
to note 23 for further details.
Gold price sensitivity analysis
The group has performed a sensitivity analysis relating to its exposure to gold price risk at reporting date. This sensitivity
analysis demonstrates the effect on the current year results and equity which could result in a change in these risks. Any
impacts from such hedging would be in relation to revenue from gold sales.
Based on gold sales of 25,185oz (121,031oz less forward sales of 95,846oz) in 2017 and 40,635oz (108,711oz less forward
sales of 68,076oz) in 2016, if gold price in Australian dollars changed by + / ‐ A$100, with all other variables remaining
constant, the estimated realised impact on pre‐tax profit (loss) and equity would have been as follows:
Impact on pre‐tax profit (loss)
Increase in gold price by A$100
Decrease in gold price by A$100
Impact on equity
Increase in gold price by A$100
Decrease in gold price by A$100
2017
$000’s
2,519
(2,519)
2016
$000’s
4,064
(4,064)
2,519
(2,519)
4,064
(4,064)
d) Capital risk management
The objective when managing capital is to maintain a strong capital base capable of withstanding cash flow variability,
whilst providing flexibility to pursue its growth aspirations. Ramelius aims to maintain an optimal capital structure to
reduce the cost of capital and maximise shareholder returns. The capital structure is equity as shown in the Balance
Sheet. The group is not subject to any externally imposed capital requirements.
82 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
40
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
e) Fair value measurement
The financial assets and liabilities of the group are recognised on the Consolidated Balance Sheet at their fair value in
accordance with the accounting policies in Note 1. Measurement of fair value is grouped into levels based on the degree
to which fair value is observable in accordance with AASB 7 Financial Instruments: Disclosure.
- Level 1 ‐ fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical
assets or liabilities.
- Level 2 ‐ fair value measurements are those derived from inputs other than quoted prices included within Level 1 that
are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices).
- Level 3 ‐ fair value measurements are those derived from valuation techniques that include inputs for the asset or
liability that are not based on observable market data (unobservable inputs).
Fair value measurement of financial instruments
Derivative financial assets are measured at fair value using the valuation provided from the relevant financial institution.
The valuations would be recognised as a Level 2 in the fair value hierarchy as they have been derived using inputs from a
variety of market data. Available‐for‐sale financial assets are measured at fair value using the closing price on the
reporting date as listed on the Australian Securities Exchange Limited (ASX). Available for sale financial assets are
recognised as a Level 1 in the fair value hierarchy as defined under AASB 7 Financial Instruments: Disclosures. The carrying
amounts of trade receivables and payables are assumed to approximate their fair values due to their short‐term nature.
Fair value measurement of non‐financial instruments
Properties are measured at fair value using 2011 valuations made by an independent valuer. At 30 June 2017, the
directors are of the opinion that the carrying amounts of properties approximate their fair value. The valuations would
be recognised as a Level 2 in the fair value hierarchy.
The valuation depends on a number of characteristics of observable market transactions in similar properties that are
used for valuation. Although this input is a subjective judgement, management considers that the carrying amounts
would not be materially affected by reasonably possible alternative assumptions.
3 Operating Segments
Management has determined the operating segments based on internal reports about components of the group that are
regularly reviewed by the Chief Operating Decision Maker (CODM), the Managing Director/Chief Executive Officer, in
order to make strategic decisions. Reportable operating segments are Mt Magnet, Burbanks and Exploration. The group
operates primarily in one business segment, namely the exploration, development and production of minerals with a
focus on gold.
The CODM monitors performance in these areas separately. Unless stated otherwise, all amounts reported to the CODM
are determined in accordance with accounting policies that are consistent to those adopted in the annual financial
statements of the group. Operating segment performance details for financial years 2017 and 2016 are set out below:
2017 Segment performance
Segment revenue
Sales revenue
Segment cost of production
Cost of production before:
Amortisation and depreciation
Movement in inventory
Deferred stripping costs
Segment cost of production
Gross margin
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
‐
(13)
‐
‐
‐
(13)
(13)
‐
‐
‐
‐
‐
‐
‐
Total
$’000
197,358
(160,040)
(59,972)
10,343
41,054
(168,615)
28,743
197,358
(160,027)
(59,972)
10,343
41,054
(168,602)
28,756
41
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 83
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
2017 Segment performance (continued)
Impairment and exploration write‐off
Reversal of prior period impairments
Segment margin
Interest income
Finance cost
Other expenses
Profit before income tax from continuing operations
2016 Segment performance
Segment revenue
Sales revenue
Segment cost of production
Cost of production before:
Amortisation and depreciation
Movement in inventory
Deferred stripping costs
Segment cost of production
Gross margin
Impairment and exploration write‐off
Segment margin
Interest income
Finance cost
Other expenses
Profit before income tax from continuing operations
2017 Segment position
Capitalised expenditure
Property, plant, and equipment
Site development
Exploration assets
Segment assets
Segment assets from continuing operations
Total segment assets
Corporate and unallocated assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Available for sale financial assets
Property, plant, and equipment
Deferred tax assets
Total consolidated assets
Mt Magnet
$’000
(8)
1,581
30,329
Burbanks
$’000
47
34
Exploration
$’000
(1,312)
‐
(1,312)
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
173,744
(151,898)
(49,880)
11,763
49,196
(140,819)
32,925
(183)
32,742
‐
(20)
‐
‐
‐
(20)
(20)
53
33
‐
‐
‐
‐
‐
‐
‐
(1,441)
(1,441)
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
254
‐
15,422
4,681
43,219
‐
102,258
102,258
‐
‐
‐
‐
‐
Total
$’000
(1,320)
1,628
29,051
1,154
(681)
(4,464)
25,060
Total
$’000
173,744
(151,918)
(49,880)
11,763
49,196
(140,839)
32,905
(1,571)
31,334
568
(834)
(5,725)
25,343
Total
$’000
4,935
43,219
15,422
19,653
19,653
121,911
121,911
78,567
3,112
259
292
246
30,944
235,332
84 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
42
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
2016 Segment position
Capitalised expenditure
Property, plant, and equipment
Site development
Exploration assets
Segment assets
Segment assets from continuing operations
Assets and disposal group classified as held for sale
Total segment assets
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
4,865
51,004
‐
100,296
‐
100,926
‐
‐
‐
176
3,225
3,401
‐
‐
5,270
8,100
‐
8,100
Corporate and unallocated assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Available for sale financial assets
Property, plant, and equipment
Deferred tax assets
Total consolidated assets
Total
$’000
4,865
51,004
5,270
109,202
3,225
112,427
44,272
1,608
198
132
199
35,410
194,246
2017 Segment position
Segment liabilities
Segment liabilities from continuing operations
Total segment liabilities
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
Total
$’000
(43,359)
(43,359)
(21)
(21)
(2,123)
(2,123)
(45,503)
(45,503)
Corporate and unallocated liabilities
Trade and other payables
Current provisions
Non‐current provisions
Deferred tax liabilities
Total consolidated liabilities
2016 Segment position
Segment liabilities
Segment liabilities from continuing operations
Liabilities included in disposal group held for sale
Total segment liabilities
Mt Magnet
$’000
Burbanks
$’000
Exploration
$’000
(45,162)
‐
(45,162)
(133)
(2,070)
(2,203)
(1,342)
‐
(1,342)
Corporate and unallocated liabilities
Trade and other payables
Current provisions
Non‐current provisions
Deferred tax liabilities
Total consolidated liabilities
(206)
(728)
(104)
(18,989)
(65,530)
Total
$’000
(46,637)
(2,070)
(48,707)
(665)
(621)
(60)
(16,605)
(66,658)
The Burbanks operating segment includes assets, liabilities, revenues and expenses of the asset and disposal group which
are classified as held for sale and discontinued operations (Note 32).
43
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 85
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Major customers
Ramelius provides goods that are more than 10% of external revenue through the Western Australian Mint in Perth,
Australia. Goods provided through the Western Australian Mint account for 100% (2016: 100%) of sales revenue.
Segments assets by geographical location
Segment assets of Ramelius are geographically located in Australia.
4 Critical Accounting Judgements, Estimates and Assumptions
Judgements, estimates and assumptions are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable in the circumstances. Estimates and assumptions
made assume a reasonable expectation of future events and are based on current trends and economic data, obtained
both externally and within the group. The judgements, estimates and assumptions will, by definition, seldom equal actual
results. The judgements, estimates and assumptions having a significant risk of causing material adjustments to the carrying
amount of assets and liabilities within the next financial year are detailed below.
a) Exploration and evaluation expenditure
The group’s policy for exploration and evaluation is discussed at Note 1(p). Application of this policy requires
management to make estimates and assumptions as to future events and circumstances, in particular the assessment
of whether economic quantities of reserves will be found. Any such estimates and assumptions may change as new
information becomes available.
b) Deferred mining expenditure
The group defers mining costs incurred during the production stage of its operations, which are calculated in accordance
with accounting policy Note 1(s). Changes in an individual mine’s design will generally result in changes to the life‐of‐
mine waste to contained gold ounces (life‐of‐mine) ratio. Changes in other technical and economic parameters that
impact reserves will also have an impact on the life‐of‐mine ratio even if they do not affect the mine’s design. Changes
to the life‐of‐mine are accounted for prospectively.
c) Ore reserve estimates
The group estimates ore reserves and mineral resources each year based on information compiled by Competent
Persons as defined in accordance with the Australian code for reporting Exploration Results, Mineral Resources and Ore
Reserves 2012 (‘JORC code’). Estimated quantities of economically recoverable reserves are based upon interpretations
of geological models and require assumptions to be made including estimates of short and long‐term commodity prices,
exchange rates, future operating performance and capital requirements. Changes in reported reserve estimates can
impact the carrying value of plant and equipment and development, provision for restoration and rehabilitation
obligations as well as the amount of depreciation and amortisation.
d) Recovery of deferred tax assets
Deferred tax assets, including those arising from unutilised tax losses require management to assess the likelihood that
the group complies with the relevant taxation legislation and will generate sufficient taxable earnings in future periods,
in order to recognise and utilise those deferred tax assets. Estimates of future taxable income are based on forecast
cash flows from operations and existing tax laws in the relevant jurisdictions. To the extent that cash flows and taxable
income differ significantly from estimates, the ability of the group to realise the net deferred tax assets reported at the
reporting date could be impacted.
Additionally, future changes in tax laws in the jurisdictions in which the group operates could limit the ability of the
group to obtain deductions in future periods.
e) Impairment of assets
The group assesses each Cash‐Generating Unit (CGU), at least annually, to determine whether there is any indication
of impairment or reversal of a prior impairment. Where an indicator of impairment or reversal exists, a formal estimate
of the recoverable amount is made, which is deemed as being the higher of the fair value less costs to sell and value in
use calculated in accordance with accounting policy Note 1(u). These assessments require the use of estimates and
assumptions such as ore reserves, future production, commodity prices, discount rates, exchange rates, operating costs,
sustaining capital costs, any future development cost necessary to produce the reserves (including the magnitude and
timing of cash flows) and operating performance.
86 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
44
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
f) Unit‐of‐production method of depreciation and amortisation
The group uses the unit‐of‐production basis when depreciating / amortising mine specific assets which results in a
depreciation / amortisation charge proportional to the depletion of the anticipated remaining life‐of‐mine production.
Economic life, which is assessed annually, has due regard to both its physical life limitations and to present assessments
of economically recoverable reserves of the mine property. These calculations require the use of estimates and
assumptions.
g) Provision for restoration and rehabilitation
The group assesses its mine restoration and rehabilitation provision bi‐annually in accordance with the accounting
policy Note 1(y). Significant judgement is required in determining the provision for restoration and rehabilitation as
there are many transactions and other factors that will affect the ultimate liability payable to rehabilitate and restore
the mine sites. The estimate of future costs therefore requires management to make assessment of the future
restoration and rehabilitation date, future environmental legislation, changes in regulations, price increases, changes
in discount rates, the extent of restoration activities and future removal technologies. When these factors change or
become known in the future, such differences will impact the restoration and rehabilitation provision in the period in
which they change or become known. At each reporting date the rehabilitation and restoration provision is
remeasured to reflect any of these changes.
h) Share based payments
The group measures the cost of equity settled transactions with employees by reference to the fair value of equity
instruments at the date at which they are granted. Fair value is determined using assumptions detailed in Note 22.
i)
Impairment of available‐for‐sale financial assets
The group follows the guidance of AASB 139 Financial Instruments: Recognition and Measurement to determine when
an available‐for‐sale financial asset is impaired. This determination requires significant judgement. In making this
judgement, the group evaluates, among other factors, the duration and extent to which the fair value of an
investment is less than its cost and the financial health of and short‐term business outlook for the investee, including
factors such as industry and sector performance, changes in technology and operational and financing cash flows.
5 Revenue and Expenses
Profit before tax includes the following revenue, income and expenses whose disclosure is relevant in explaining the
performance of the group:
Note
2017
$000’s
2016
$000’s
a) Sales revenue
Gold sales
Silver sales
Other revenue
Total sales revenue from continuing operations
b) Cost of production
Amortisation and depreciation
Employee benefits expense
Inventory movements
Mining and milling production costs
Royalty costs
Total cost of production from continuing operations
197,012
304
42
197,358
173,453
242
49
173,744
59,972
16,213
(10,343)
92,823
9,950
168,615
49,880
14,168
(11,763)
83,917
4,637
140,839
45
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 87
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
c) Other expenses
Amortisation and depreciation
Employee benefits expense
Equity settled share‐based payments
Exploration costs written off
Impairment of development assets
Impairment of exploration and evaluation assets
Impairment of debtors
Loss on derivative financial instruments
Loss on disposal of property, plant and equipment assets
Foreign exchange losses
Other expenses
Total other expenses from continuing operations
d) Other income
Gain on disposal of tenements
Gain on sale of subsidiary
Foreign exchange gains
Total other income
e) Net finance expenses (income)
Discount unwind on provisions and borrowings
Interest and finance charges
Total finance costs
Interest income
Net finance expenses (income) from continuing operations
6 Remuneration of Auditors
Audit and other assurance services
Audit and review of financial statements ($)
Non‐assurance services
Tax advice and compliance services ($)
Gender survey assistance
Total remuneration of Grant Thornton ($)
Note
2017
$000’s
2016
$000’s
22
15
17
10
32
19
60
3,019
777
680
(1,629)
632
8
80
16
6
2,297
5,946
425
1,362
3
1,790
565
116
681
(1,154)
(473)
76
2,446
117
650
130
791
‐
1,196
‐
8
1,889
7,303
‐
‐
7
7
553
281
834
(568)
266
99,296
101,500
20,220
‐
119,516
7,000
580
109,080
88 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
46
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Income Tax (Benefit) Expense
7
The components of tax (benefit) expense comprise:
Current tax
Deferred tax
Income tax from discontinued operations
Income tax (benefit) expense from continuing operations
Reconciliation of income tax (benefit) expense to prima facie tax payable:
Accounting profit before tax
Income tax expense calculated at 30% (2016: 30%)
Tax effects of amounts which are not deductible
(taxable) in calculating taxable income:
‐ share‐based payments
‐ other non‐allowable items
‐ non‐assessable income from disposal of subsidiary
‐ losses not previously recognised
Income tax (benefit) expense
Applicable weighted average effective tax rate
30 June 2017 deferred tax movement
Note
2017
$000’s
2016
$000’s
32
‐
7,432
(14)
7,418
‐
(2,519)
97
(2,422)
25,060
7,518
25,343
7,603
233
403
(736)
‐
7,418
35
77
‐
(10,137)
(2,422)
30%
(10%)
Deferred tax liability
Exploration and evaluation
Development
Inventory ‐ consumables
Unrealised foreign exchange gain (loss)
Group deferred tax liability (DTL)
DTL from discontinued operation (Note 32)
DTL from continuing operations
Deferred tax asset
Equity transaction costs
Inventory ‐ deferred mining costs
Property, plant and equipment
Receivables
Provisions
Tax losses
Borrowing costs
Other
Group deferred tax asset (DTA)
DTA from discontinued operation (Note 32)
DTA from continuing operations
Balance
at 1 July
2016
$000’s
Charged /
(credited) to
income
$000’s
Charged /
(credited) to
equity
$000’s
Balance at
30 June
2017
$000’s
2,096
14,405
103
3
16,607
(2)
16,605
78
1,149
1,179
‐
8,339
25,447
91
129
36,412
(1,002)
35,410
3,634
(1,278)
31
(3)
2,384
‐
2,384
(143)
600
100
3
(476)
(5,053)
(91)
12
(5,048)
14
(5,034)
‐
‐
‐
‐
‐
‐
‐
568
‐
‐
‐
‐
‐
‐
‐
568
‐
568
5,730
13,127
134
‐
18,991
(2)
18,989
503
1,749
1,279
3
7,863
20,394
‐
141
31,932
(988)
30,944
47
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 89
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
30 June 2016 deferred tax movement
Deferred tax liability
Exploration and evaluation
Development
Inventory ‐ consumables
Unrealised foreign exchange gain (loss)
Group deferred tax liability (DTL)
DTL from discontinued operation (Note 32)
DTL from continuing operations
Deferred tax asset
Equity transaction costs
Inventory ‐ deferred mining costs
Property, plant and equipment
Receivables
Provisions
Tax losses
Borrowing costs
Other
Group deferred tax asset (DTA)
DTA from discontinued operation (Note 32)
DTA from continuing operations
Tax effects relating to comprehensive income
Balance
at 1 July
2015
$000’s
Charged /
(credited) to
income
$000’s
Charged /
(credited) to
equity
$000’s
Balance at
30 June
2016
$000’s
1,511
10,734
136
95
12,476
(2)
12,474
285
2,678
1,160
65
7,988
17,463
‐
160
29,799
(1,136)
28,663
585
3,671
(33)
(92)
4,131
‐
4,131
(209)
(1,529)
19
(65)
351
7,984
91
8
6,650
134
6,784
‐
‐
‐
‐
‐
‐
‐
2
‐
‐
‐
‐
‐
‐
(39)
(37)
‐
(37)
2,096
14,405
103
3
16,607
(2)
16,605
78
1,149
1,179
‐
8,339
25,447
91
129
36,412
(1,002)
35,410
Revaluation of available‐for‐sale assets
280
‐
280
162
40
202
Pre‐tax
$000’s
2017
Tax effect
$000’s
Net of tax
$000’s
Pre‐tax
$000’s
2016
Tax effect
$000’s
Net of tax
$000’s
2017
$000’s
2016
$000’s
Franking credits
Franking credits available for subsequent years based on a tax rate of 30% (2016: 30%)
21,826
21,826
The above represents the balance of the franking account as at the end of the reporting period, adjusted for:
a) franking credits (debits) that will arise from payment of the current tax liability (current tax asset), and
b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date.
Tax losses
Unused tax losses for which no deferred tax asset has been recognised
Potential tax benefit at 30%
4,080
1,224
3,137
941
All unused tax losses have been recognised as a deferred tax asset, with the exception of capital losses. The Directors
have assessed that it is probable the group will generate sufficient taxable profits to utilise the losses recognised as a
deferred tax asset. All unused tax losses were incurred by Australian entities that are part of the tax consolidated group.
See Note 4(d) for information about recognised tax losses and significant judgements made in relation to them.
90 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
48
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
8
Earnings Per Share
Classification of securities
All ordinary shares have been included in basic earnings per share.
Classification of securities as potential ordinary shares
Rights to shares granted to executives and senior managers are included in the calculation of diluted earnings per share
and assume all outstanding rights will vest. Rights are included in the calculation of diluted earnings per share to the
extent they are dilutive. Options have been included in determining diluted earnings per share to the extent that they
are in the money (i.e. not antidilutive). Rights and options are not included in basic earnings per share.
Earnings used in the calculation of earnings per share
Both the basic and diluted earnings per share have been calculated using the profit after tax as the numerator.
Weighted average number of shares used as the denominator
Number for basic earnings per share
Ordinary shares
Number of dilutive securities
Share rights and options
Total number of securities for dilutive earnings per share
9 Cash and Cash Equivalents
Cash at bank and in hand
Deposits at call
Secured deposits 1
Total cash and cash equivalents
2017
2016
521,082
473,328
5,629
526,711
838
474,166
2017
$000’s
2016
$000’s
71,752
15
6,800
78,567
35,781
15
8,476
44,272
1 Includes $2,687,312 (2016: $2,595,145) of deposits provided as security against unconditional bank guarantees in favour of the Minister for Mines
and Energy (Northern Territory), Central Land Council in the Northern Territory for exploration purposes and in favour of other entities to secure
supply of gas and electricity. Also includes a minimum reserve amount of $2,500,000 (2016: $5,000,000) as security under the finance facility.
Risk exposure
The group’s exposure to interest rate risk is discussed in Note 2. Maximum exposure to credit risk at the end of the
reporting period is the carrying amount of each class of cash and cash equivalents disclosed above.
10 Trade and Other Receivables
Current
Trade receivables
Provision for impairment
Trade receivables
Other receivables
Total current trade and other receivables
Non‐current
Other receivables
Total non‐current trade and other receivables
32
(8)
24
1,890
1,914
1,286
1,286
106
‐
106
1,730
1,836
‐
‐
49
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 91
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Classification of trade and other receivables
Trade receivables are amounts due from customers for goods sold and services performed in the ordinary course of
business. Trade receivables are generally due for settlement within 30 days and therefore classified as current. The
group’s impairment and other accounting policies for trade and other receivables are outlined in Notes 1(l) and 2(b).
Other receivables comprise accrued interest and amounts due from taxation authorities. If collection of the amounts is
expected in one year or less they are classified as current assets. If not, they are classified as non‐current assets.
Fair values of trade and other receivables
Due to the short‐term nature of the current receivables, their carrying amount is assumed to be the same as their fair
value. For non‐current receivables, the fair values are also not significantly different to their carrying amounts.
Impairment and risk exposure
Refer Note 2 for more information on the risk management policy of the group and credit quality of trade receivables.
Other receivables – Share Sale Agreement – Ramelius Milling Services Pty Limited
Other receivables include $450,000 (current) and $1,286,000 (non‐current) receivable from Maximus Resources Limited
in relation to the Share Sale Agreement for Ramelius Milling Services Pty Limited.
Inventories
11
Gold nuggets at cost
Ore stockpiles
Gold in circuit
Bullion
Consumables and supplies
Total inventories from continuing operations
2017
$000’s
2016
$000’s
80
12,824
8,097
3,623
4,607
29,231
80
7,410
7,343
‐
4,114
18,947
Inventory expense
There were no write‐downs of inventories to net realisable value during the year ended 30 June 2017 (2016: Nil).
12 Other Assets
Current
Prepayments
Non‐current
Refundable deposits
891
868
412
526
Fair values of other assets
Due to the short‐term nature of other assets, their carrying amount is assumed to be the same as their fair value. For
non‐current other assets, the fair values are also not significantly different to their carrying amounts.
13 Available‐For‐Sale Financial Assets
Shares in listed corporations at fair value
292
132
Classification of financial assets as available‐for‐sale
Investments are designated as available‐for‐sale financial assets if they do not have fixed maturities and fixed or
determinable payments, and management intends to hold them for the medium to long‐term. The financial assets are
presented as non‐current assets unless they mature, or management intends to dispose of them within 12 months of the
end of the reporting period.
92 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
50
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Risk exposures and fair value measurements
Available‐for‐sale financial assets are recognised as a Level 1 in the fair value hierarchy as defined under AASB 7
Financial Instruments: Disclosures. Information about the group’s exposure to credit risk and the methods and
assumptions used in determining fair values is provided in Note 2.
14 Property, Plant and Equipment
Property
Properties at fair value (a)
Additions
Less accumulated depreciation
Total property
Plant and equipment
Plant and equipment at cost
Less accumulated depreciation
Total plant and equipment
Total property, plant and equipment
2017
$000’s
2016
$000’s
1,588
30
(210)
1,408
60,246
(42,415)
17,831
19,239
1,588
(170)
1,418
55,470
(36,349)
19,121
20,539
14(d)
14(d)
(a) Valuation of property
Properties are recognised as a Level 2 in the fair value hierarchy as defined under AASB 13 Fair Value Measurements. The
valuation basis of property is fair value being the amounts for which the assets could be exchanged between willing
parties in an arm’s length transaction, based on current prices in an active market for similar properties in the same
location and condition. The 2011 valuations were made by independent valuers. At 30 June 2017, the directors are of the
opinion that the carrying amounts of properties approximate their fair values.
(b) Carrying amounts that would have been recognised if land and buildings were stated at cost
If properties were stated on the historical cost basis, the amounts would be as follows:
Property
Properties at cost
Additions
Accumulated depreciation
Total property assets
666
30
(81)
615
607
59
(65)
601
(c) Assets in the course of construction
Plant and equipment includes the following expenditure which is in the course of construction:
Plant and equipment in the course of construction
1,744
625
(d) Property, plant and equipment asset reconciliation
Property asset reconciliation
Balance at beginning of financial year
Additions
Depreciation
Total property
Plant and equipment asset reconciliation
Balance at beginning of financial year
Additions
Disposals
Depreciation
Plant and equipment from discontinued operation
Total plant and equipment
1,418
30
(40)
1,408
19,121
4,863
(21)
(6,132)
‐
17,831
1,397
59
(38)
1,418
24,486
4,903
(1)
(8,604)
(1,663)
19,121
51
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 93
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(e) Re‐assessment of depreciation
In July 2016, the group reassessed the useful life of a fixed asset class and made adjustments to the net book value
through depreciation. The asset class is depreciated using the straight line method and the useful life of the asset
reflects the revised life of mine plan. The overall impact is a $1.0 million reduction in depreciation in the 2017 financial
year (2016: $2.3 million).
15 Development Assets
Development assets at cost
Less accumulated amortisation
Total development assets
(a) Development asset reconciliation
Balance at beginning of financial year
Additions
Restoration and rehabilitation adjustment
Impairment
Transfer from exploration and evaluation expenditure
Amortisation
Total development assets
Intangible Assets
16
Software at cost
Accumulated amortisation
Total intangible assets
(a) Intangible asset reconciliation
Balance at beginning of financial year
Amortisation
Total intangible assets
17 Exploration and Evaluation Expenditure
Exploration and evaluation
(a) Exploration and evaluation expenditure reconciliation
Balance at beginning of financial year
Additions
Transfers to development assets
Impairment expense 1
Total exploration and evaluation expenditure
2017
$000’s
2016
$000’s
164,230
(110,775)
53,455
117,537
(56,903)
60,634
60,634
43,392
(1,802)
1,629
3,474
(53,872)
53,455
46,607
50,678
456
(130)
4,429
(41,406)
60,634
874
(874)
‐
73
(73)
‐
874
(801)
73
191
(118)
73
19,101
7,784
7,784
15,423
(3,474)
(632)
19,101
7,734
5,270
(4,429)
(791)
7,784
1 Impairment of specific exploration and evaluation assets during the year have occurred where Directors have concluded that capitalised
expenditure is unlikely to be recovered by sale or future exploitation
18 Trade and Other Payables
Trade payables
Other payables and accrued expenditure
Total trade and other payables
5,008
17,390
22,398
9,192
13,063
22,255
94 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
52
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Classification of trade and other payables
Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying amounts of trade and
other payables are assumed to be the same as their fair values, due to their short‐term nature.
Risk exposure
The group’s exposure to cash flow risk is discussed in Note 2.
19 Provisions
Current
Employee benefits
Rehabilitation and restoration costs
Total current provisions
Non‐current
Employee benefits
Rehabilitation and restoration costs
Total non‐current provisions
2017
$000’s
2016
$000’s
2,693
21
2,714
536
20,893
21,429
2,408
984
3,392
444
21,892
22,336
Provision for long service leave
Provision for long service leave is recognised for employee benefits. In calculating its present value, the probability of
leave being taken is based on historical data. Refer Note 1(x) for measurement and recognition criteria.
Provision for rehabilitation and restoration
Provision for rehabilitation and restoration represents management’s assessment of expenditure expected to be incurred
for various mines and processing plant. Refer Note 1(y) for measurement and recognition criteria.
Rehabilitation and restoration reconciliation
Current
Balance at beginning of financial year
Revision of provision 1
Expenditure on restoration and rehabilitation
Discount unwind
Total current provision for rehabilitation and restoration
Non‐current
Balance at beginning of financial year
Revision of provision 1
Expenditure on restoration and rehabilitation
Discount unwind
Provision associated with assets from discontinued operation
Total non‐current provision for rehabilitation and restoration
984
(257)
(725)
19
21
21,892
(1,545)
‐
546
‐
20,893
‐
983
‐
1
984
24,111
(551)
(203)
603
(2,068)
21,892
1 Represents amendments to future restoration and rehabilitation liabilities resulting from changes to the approved mine plan in the financial year,
initial recognition of new rehabilitation provisions as well as a change in provision assumptions. Key provision assumption changes include
reassessment of costs and timing of expenditure.
53
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 95
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
20
Share Capital
a) Ordinary shares
Share capital at 30 June 2015
Share capital during the 2015‐16 financial year
Issue of shares resulting from vesting of rights
Shares issued from exercise of options
Less cost of share issues (net of tax)
Share capital at 30 June 2016
Share capital during the 2016‐17 financial year
Shares issued from exercise of options
Shares issued under placement
Less cost of share issues (net of tax)
Share capital at 30 June 2017
Number of
Shares
$
469,217,969
124,251,185
70,000
5,946,279
‐
475,234,248
‐
831,588
(2,483)
125,080,290
1,500,000
50,000,000
‐
526,734,248
373,035
25,000,000
(1,331,374)
149,121,951
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at shareholders’ meetings other than voting exclusions as required by the Corporations Act 2001. In the event
of winding up of the Company, ordinary shareholders rank after all creditors and are fully entitled to any proceeds of
liquidation.
b) Options over shares
Refer Note 22 for further information on options, including details of any options issued, exercised and lapsed during the
financial year and options over shares outstanding at financial year end.
c) Rights over shares
Refer Note 22 for further information on rights, including details of any rights issued, exercised and lapsed during the
financial year and rights over shares outstanding at financial year end.
21 Reserves
Share‐based payments reserve 1
Available‐for‐sale reserve 2
Asset revaluation reserve 3
Total reserves
2017
$000’s
2016
$000’s
861
(575)
634
920
84
(295)
634
423
1 Share‐based payments reserve records items recognised as expenses on valuation of employees share options and rights.
2 Available‐for‐sale reserve records changes in the fair value of available‐for‐sale financial assets.
3 Asset revaluation reserve records revaluations of non‐current assets.
22 Share‐Based Payments
Shares
Under the Employee Share Acquisition Plan, which was approved by shareholders in November 2007, eligible employees
are granted ordinary fully paid shares in Ramelius for no cash consideration. All Australian resident permanent employees
who are employed by the group are eligible to participate in the plan. Members of the plan receive all the rights of
ordinary shareholders. Unrestricted possession of these shares occurs at the earliest of, three years from date of issue or
the date employment ceases.
No shares were issued to employees during the 2017 financial year (2016: nil).
96 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
54
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Effective
grant date
Options
No employees were granted options in the 2017 financial year. Details of the movements in options issued in prior years
and those outstanding at the end of the financial year are detailed below.
Fair
value
per
option
$0.027
$0.029
$0.087
$0.095
Expiry
date
11 Jun 17
11 Jun 18
11 Jun 19
11 Jun 20
Exercise
price 1
$0.249
$0.299
$0.200
$0.200
Vesting
date
11 Jun 15
11 Jun 16
11 Jun 17
11 Jun 18
Vested
options at
end of
year
‐
1,500,000
1,500,000
‐
3,000,000
Unvested
options at
end of
year
‐
‐
‐
1,500,000
1,500,000
Options
exercised or
lapsed
(1,500,000)
‐
‐
‐
(1,500,000)
Options at
start of
year
1,500,000
1,500,000
1,500,000
1,500,000
6,000,000
Number
granted
1,500,000
1,500,000
1,500,000
1,500,000
6,000,000
Options
vested
‐
‐
1,500,000
‐
1,500,000
2017
16 Apr 14
16 Apr 14
26 Nov 15
20 Nov 15
Total
1
The exercise price of the options has been adjusted for a 1 for 4 pro‐rata rights issue in the 2015 financial year in accordance with the terms of
the options.
Effective
grant date
2016
16 Apr 14
16 Apr 14
16 Apr 14
26 Nov 15
20 Nov 15
Total
Expiry
date
11 Jun 16
11 Jun 17
11 Jun 18
11 Jun 19
11 Jun 20
Exercise
price 1
$0.199
$0.249
$0.299
$0.200
$0.200
Fair
value
per
option
$0.028
$0.027
$0.029
$0.087
$0.095
Number
granted
1,500,000
1,500,000
1,500,000
1,500,000
1,500,000
7,500,000
Options at
start of
year
1,500,000
1,500,000
‐
‐
‐
3,000,000
Options
vested
‐
‐
1,500,000
‐
‐
1,500,000
Options
exercised or
lapsed
(1,500,000)
‐
‐
‐
‐
(1,500,000)
Vested
options at
end of
year
‐
1,500,000
1,500,000
‐
‐
3,000,000
Unvested
options at
end of
year
‐
‐
‐
1,500,000
1,500,000
3,000,000
Vesting
date
11 Jun 14
11 Jun 15
11 Jun 16
11 Jun 17
11 Jun 18
1
The exercise price of the options has been adjusted for a 1 for 4 pro‐rata rights issue in the 2015 financial year in accordance with the terms of
the options.
Weighted average remaining contractual life of granted options at the end of the period is 1.95 years (2016: 1.77 years).
The fair value at grant date is independently determined using a Black‐Scholes option pricing model that takes into
account the exercise price, the term of the option, the share price at grant date, expected price volatility of the underlying
share and the risk free rate for the term of the option. The expected price volatility is based on historic volatility (based
on the remaining life of the options). Model inputs for options granted are as follows:
Metric
Exercise price
Grant date
Expiry date
Share price at grant date
Expected price volatility
Risk free rate
Options expiring
11 June 2017
$0.25
16 Apr 2014
11 Jun 2017
$0.11
65.83%
2.74%
Options expiring
11 June 2018
$0.30
16 Apr 2014
11 Jun 2018
$0.11
62.79%
2.93%
Options expiring
11 June 2019
$0.20
26 Nov 2015
11 Jun 2019
$0.18
70.48%
2.06%
Options expiring
11 June 2020
$0.20
26 Nov 2015
11 Jun 2020
$0.18
68.46%
2.13%
Performance Rights
Under the Performance Rights Plan, which was approved by shareholders at the 2016 Annual General Meeting, eligible
employees are granted performance rights (each being an entitlement to an ordinary fully paid share) subject to the
satisfaction of vesting conditions and on the terms and conditions as determined by the board. Performance rights are
issued for no consideration and have a nil exercise price.
The amount of performance rights that vest depends on Ramelius Resources Limited’s total return to shareholders
(TSR), including share price growth, dividends and capital returns, and ranking within a peer group. Once vested
performance rights remain exercisable for a period of seven years.
55
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 97
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Performance rights issued under the plan carry no voting or dividend rights.
Effective grant date
23 November 2016
23 November 2016
23 November 2016
22 December 2016
Total
Expiry date
1 July 2024
1 July 2025
1 July 2026
11 June 2026
Fair value per
performance
right
$0.333
$0.325
$0.365
$0.363
Number
granted
976,448
976,443
976,439
500,000
3,429,330
Performance rights at
start of year
Vested
Unvested
Performance
rights vested
Performance rights at
end of year
Vested
Unvested
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
976,448
976,443
976,439
500,000
3,429,330
Vesting &
exercise date
1 July 2017
1 July 2018
1 July 2019
11 June 2019
The fair value at grant date is independently determined using a Monte Carlo Simulations pricing model that takes into
account the exercise price, the term of the performance right, the share price at grant date, expected price volatility of
the underlying share and the risk free rate for the term of the performance right. The expected price volatility is based
on historic volatility (based on the remaining life of the performance right). Model inputs for performance rights granted
are as follows:
Metric
Exercise price
Grant date
Life
Share price at grant date
Expected price volatility
Risk free rate
Performance rights granted
23 November 2016
Performance rights granted
22 December 2016
$nil
23 November 2016
0.6 yrs / 1.6 yrs / 2.6 years
$0.49
68.4%
1.70%
$nil
22 December 2016
2.6 years
$0.49
68.4%
1.70%
Expenses arising from share‐based payment transactions
Total expenses arising from share‐based payment transaction recognised during the period as part of employee benefits
expense.
Rights
Performance rights
Options
Total share‐based payment expense
2017
$000’s
‐
641
136
777
2016
$000’s
13
-
104
117
23 Commitments
a) Gold delivery commitments
Forward sale contracts are accounted for as sale contracts with revenue recognised once gold has been physically
delivered. The physical gold delivery contracts are considered own use contracts and therefore do not fall within the
scope of AASB 139 Financial Instruments: Recognition and Measurement. As a result no derivatives are required to be
recognised. Forward gold sale contract delivery commitments are shown below:
Gold Delivery
Commitments
As at 30 June 2017
Within one year
Between one and five years
Total / weighted average
Gold for Physical
Delivery
oz
Contracted Sale Price
A$/oz
Committed Gold Sale Value
$000’s
67,000
35,000
102,000
1,714.87
1,702.89
1,710.76
114,896
59,601
174,497
98 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
56
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Gold Delivery
Commitments
As at 30 June 2016
Within one year
Between one and five years
Total / weighted average
Gold for Physical
Delivery
oz
73,846
32,000
105,846
Contracted Sale Price
A$/oz
Committed Gold Sale Value
$000’s
1,598.06
1,608.72
1,601.28
118,010
51,479
169,489
b) Capital expenditure commitments
Capital expenditure contracted but not provided for in the financial statements.
Within 1 year
Later than 1 year but not later than 5 years
Total capital expenditure commitments
c) Operating lease commitments
Future minimum rentals payable on non‐cancellable operating leases due:
Within 1 year
Later than 1 year but not later than 5 years
Total operating lease commitments
2017
$000’s
2016
$000’s
868
‐
868
585
161
746
1,058
800
1,858
739
782
1,521
Significant operating leases include the following:
The group has a 3 year non‐cancellable operating lease for office space in Adelaide effective from December 2014 at a
cost of $91,067 per annum plus CPI adjustments.
The group has a 3 year non‐cancellable operating lease for office space in Perth effective from May 2016 at a cost of
$144,075 per annum plus CPI adjustments.
The group has a 2 year non‐cancellable operating lease for the hire of two items of plant and equipment at Mt Magnet
effective from April 2016 at a cost of $204,600 per annum.
d) Minimum exploration and evaluation commitments
In order to maintain current rights of tenure to exploration tenements, the group is required to perform minimum
exploration work to meet minimum expenditure requirements. These obligations are subject to renegotiation and may
be farmed out or relinquished. These obligations are not provided for in the financial statements.
Within 1 year
Later than 1 year but not later than 5 years
Due later than 5 years
Total minimum exploration and evaluation commitments
3,198
11,094
23,329
37,621
3,193
14,541
27,257
44,991
e) Other commitments
The group has contractual obligations for various expenditures such as royalties, production based payments, exploration
and the cost of goods and services supplied to the group. Such expenditures are predominantly related to the earning of
revenue in the ordinary course of business. These obligations are not provided for in the financial statements.
57
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 99
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
24 Contingent Liabilities
The directors are of the opinion that the recognition of a provision is not required in respect of the following matters, as
it is not probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable
measurement.
(a) Bank guarantees
The group has negotiated a number of bank guarantees in favour of various government authorities and service providers.
The total nominal amount of these guarantees at the reporting date is $2,687,312 (2016: $2,595,145). These bank
guarantees are fully secured by cash on term deposit.
Note
2017
$000’s
2016
$000’s
25 Cash Flow Information
a) Reconciliation of cash
For the purposes of the Consolidated Statement of Cash Flows, cash includes cash on hand and at bank and highly liquid
investments in money market instruments, net of outstanding bank overdrafts. Cash at end of the financial year as shown
in the Consolidated Statement of Cash Flows is reconciled to the related items in the Consolidated Balance Sheet as
follows:
Cash
Cash on deposit
Total cash and cash equivalents
71,752
6,815
78,567
35,781
8,491
44,272
9
b) Reconciliation of net profit to net cash provided by operating activities
Profit (loss) after income tax
17,675
27,540
Non‐cash items
‐ Share‐based payments
‐ Depreciation and amortisation
‐ Impairment of assets
‐ Tenement costs written‐off
‐ Discount unwind on provisions
‐ Effect of exchange rate
‐ Net fair value of derivative instruments
‐ Discontinued operations
Items presented as investing or financing activities
‐ (Gain) loss on disposal of non‐current assets
‐ Available for sale investments
‐ Demobilisation and restoration activities
Changes in assets and liabilities
(Increase) decrease:
‐ Prepayments
‐ Trade and other receivables
‐ Inventories
‐ Deferred tax assets
(Decrease) increase:
‐ Trade and other payables
‐ Provisions
‐ Deferred tax liabilities
Net cash provided by operating activities
100 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
58
777
60,057
(997)
‐
566
1
80
92
16
(425)
946
3
(1,446)
(10,282)
5,050
10,480
(1,546)
2,383
83,430
117
49,956
921
34
553
(4)
1,196
215
‐
203
(120)
1,532
(11,104)
(6,652)
(3,183)
180
4,132
65,516
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
2017
$
2016
$
26 Related Parties
Transactions with related parties are on normal commercial terms and at conditions no more favourable than those
available to other parties unless otherwise stated.
a) Key management personnel compensation
Short‐term employee benefits
Post‐employment benefits
Other long‐term benefits
Share‐based payments
Total key management personnel compensation
Detailed remuneration disclosures are provided in the Remuneration Report.
b) Subsidiaries
Interests in subsidiaries are set out in Note 28.
2,398,064
199,347
40,046
405,937
3,043,394
1,878,746
180,000
38,813
102,801
2,200,360
c) Transactions with other related parties
Lease payments were made during the year to an entity related to the Chairman, Mr R M Kennedy. The lease agreement
is for the office property in Adelaide, SA and has been based on normal commercial terms on conditions on an arm’s
length basis.
Aggregate amounts of each of the above types of transactions with key management personnel of Ramelius Resources
Limited:
Amounts recognised as an expense
Rent of office building
Amounts recognised as current other debtors
Security deposit on premises
2017
$
2016
$
97,749
93,816
13,935
13,935
The Chairman, Mr R M Kennedy, is the Chairman of Maximus Resources Limited. During the year Ramelius Resources
Limited entered into a Share Sale Agreement with Maximus Resources Limited for the sale of Ramelius Milling Services
Pty Limited (the owner and operator of the Burbanks Mill). The Share Sale Agreement was made on normal commercial
terms and conditions on an arm’s length basis.
Amounts recognised as other receivables
Current
Non ‐ current
2017
$
450,000
1,286,217
2016
$
‐
‐
There was no other amount receivable from or payable to directors and their related entities at reporting date.
59
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 101
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
27 Deed of Cross Guarantee
Pursuant to Class Order 98/1418, wholly‐owned subsidiary Mt Magnet Gold Pty Ltd (formerly Mt Magnet Gold NL)
(Subsidiary) is relieved from the Corporations Act requirements for preparation, audit and lodgement of its financial
reports.
As a condition of the Class Order, Ramelius and Mt Magnet Gold Pty Ltd (the Closed Group) entered into a Deed of Cross
Guarantee on 15 December 2011 (Deed). The effect of the Deed is that Ramelius has guaranteed to pay any deficiency
in the event of winding up of the abovementioned Subsidiary under certain provisions of the Corporations Act 2001. Mt
Magnet Gold Pty Ltd has also given a similar guarantee in the event that Ramelius is wound up.
The Consolidated Statement of Comprehensive Income and Balance Sheet of the Closed Group are as follows:
Consolidated Statement of Comprehensive Income
Sales revenue
Cost of production
Gross profit (loss)
Other expenses
Other income
Operating profit (loss) before interest income and finance cost
Interest income
Finance costs
Profit (loss) before income tax
Income tax benefit (expense)
Profit (loss) for the year
Other comprehensive income
Net change in fair value of available‐for‐sale assets
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Closed Group
2017
$000’s
2016
$000’s
197,358
(168,615)
28,743
173,744
(140,839)
32,905
(5,946)
1,790
24,587
1,154
(681)
25,060
(7,418)
17,642
(280)
(280)
17,362
(7,303)
7
25,609
568
(834)
25,343
2,422
27,765
(202)
(202)
27,563
102 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
60
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Consolidated Balance Sheet
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Total current assets
Non‐current assets
Available‐for‐sale financial assets
Trade and other receivables
Exploration and evaluation expenditure
Property, plant, equipment and development assets
Intangible assets
Deferred tax assets
Total non‐current assets
Total assets
Current liabilities
Trade and other payables
Provisions
Total current liabilities
Non‐current liabilities
Provisions
Deferred tax liabilities
Total non‐current liabilities
Total liabilities
Net assets
Equity
Share capital
Reserves
Retained earnings (losses)
Total equity
Closed Group
2017
$000’s
2016
$000’s
78,567
1,914
29,231
891
110,603
292
1,698
19,101
72,694
‐
30,944
124,729
235,332
43,304
1,772
18,947
827
64,850
132
1,330
7,784
81,173
73
35,410
125,902
190,752
22,398
2,714
25,112
22,268
3,392
25,660
21,429
18,989
40,418
65,530
169,802
149,122
920
19,760
169,802
22,336
16,604
38,940
64,600
126,152
125,080
423
649
126,152
Investments in Controlled Entities
28
The consolidated financial statements incorporate assets, liabilities and results of the ultimate parent entity, Ramelius
Resources Limited, and the following subsidiaries in accordance with the accounting policy described in Note 1(b).
Parent entity
Ramelius Resources Limited
Country of
Incorporation
Percentage Owned (%) 1
2017
2016
Australia
Subsidiaries of Ramelius Resources Limited
Mt Magnet Gold Pty Ltd
Ramelius Milling Services Pty Ltd 2
RMSXG Pty Limited3
1 Percentage of voting power is in proportion to ownership.
2 Company discontinued and sold to Maximus Resources Limited 31 August 2016, (see Note 32)
3 RMSXG Pty Limited was incorporated on 12 August 2016.
Australia
Australia
Australia
100
‐
100
100
100
‐
61
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 103
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Interests in Joint Operations
29
The group has the following direct interest in unincorporated joint operations at 30 June 2017 and 30 June 2016:
Joint operation project
Tanami
Bonalbo
Jupiter
South Monitor
Joint operation partner
Tychean Resources Ltd
Unlisted entity
Kinetic Gold
Newmont
Principal activities
Gold
Gold
Gold
Gold
2017
85%
80%
75%
51%
2016
85%
‐
‐
‐
Interest (%)
The share of assets in unincorporated joint operations is as follows:
Non‐current assets
Exploration and evaluation expenditure (Note 17)
2017
$000’s
2016
$000’s
2,247
1,112
30 Subsequent Events
No matters or circumstances have arisen since 30 June 2017 that have significantly affected, or may significantly affect:
(a) The group’s operations in future financial years,
(b) The results of operations in future financial years, or
(c) The group’s state of affairs in future financial years.
31 Parent Entity Information
a) Summary of financial information
Financial statements for the parent entity show the following aggregate amounts:
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Equity
Share capital
Reserves
Share‐based payment reserve
Available‐for‐sale reserve
Retained losses
Total equity
b) Income Statement
Profit (loss) after income tax
Total comprehensive income (loss)
c) Commitments
(i) Operating lease commitments
Future minimum rentals payable on non‐cancellable operating leases due:
Within 1 year
Later than 1 year but not later than 5 years
Total operating lease commitments
104 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
62
Parent entity
2017
$000’s
2016
$000’s
73,637
163,537
(5,274)
(12,998)
147,838
37,906
145,980
(11,665)
(22,311)
123,669
149,122
125,080
861
(575)
(1,570)
147,838
84
(295)
(1,200)
123,669
(370)
(650)
28,539
28,337
335
135
470
442
466
908
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Parent entity
2017
$000’s
2016
$000’s
(ii) Minimum exploration and evaluation commitments
In order to maintain current rights of tenure to exploration tenements, Ramelius is required to perform minimum
exploration work to meet minimum expenditure requirements. These obligations are subject to renegotiation and may
be farmed out or relinquished. These obligations are not provided for in the parent entity financial statements.
Within 1 year
Later than 1 year but not later than 5 years
Later than 5 years
Total minimum exploration and evaluation commitments
1,215
6,813
4,990
13,018
1,253
3,325
2,134
6,712
Significant operating leases include the following:
The group has a 3 year non‐cancellable operating lease for office space in Adelaide effective from December 2014 at a
cost of $91,067 per annum plus CPI adjustments.
The group has a 3 year non‐cancellable operating lease for office space in Perth effective from May 2016 at a cost of
$144,075 per annum plus CPI adjustments.
(iii) Other commitments
Ramelius Resources Limited has contractual obligations for various expenditures such as royalties, production based
payments, exploration and the cost of goods and services supplied to the parent entity. Such expenditures are
predominantly related to the earning of revenue in the ordinary course of business. These obligations are not provided
for in the parent entity financial statements.
d) Contingent liabilities
The directors are of the opinion that the recognition of a provision is not required in respect of the following matters, as
it is not probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable
measurement.
(i) Bank guarantees
Ramelius has negotiated a number of bank guarantees in favour of various government authorities and service providers.
The total nominal amount of these guarantees at the reporting date is $2,687,312 (2016: $2,578,145). These bank
guarantees are fully secured by cash on term deposit.
e) Guarantees in relation to debts of subsidiaries
Ramelius and Mt Magnet Gold Pty Ltd (the Closed Group) entered into a Deed of Cross Guarantee on 15 December 2011
(Deed) as noted in Note 27. The effect of the Deed is that Ramelius has guaranteed to pay any deficiency in the event of
winding up of the abovementioned Subsidiary under certain provisions of the Corporations Act 2001. Mt Magnet Gold
Pty Ltd has also given a similar guarantee in the event that Ramelius is wound up.
32 Assets and Disposal Group Classified as Held For Sale and Discontinued Operations
During the financial year the Company decided to sell Ramelius Milling Services Pty Ltd which owns the Burbanks
processing facility. This decision was taken in line with the Group’s strategy to focus on its producing operations.
Consequently, certain assets and liabilities allocable to Ramelius Milling Services Pty Ltd are classified as a disposal group.
Revenue and expenses, gains and losses relating to the discontinuation of this subgroup have been eliminated from profit
or loss from the Group’s continuing operations and are shown as a single line item on the face of the statement of profit
or loss.
Ramelius Resources Limited and Maximus Resources Limited (ASX: MXR), a director related entity, signed a Share Sale
Agreement in August 2016 whereby Ramelius Milling Services Pty Ltd was sold for a total of $2,500,000 which includes
staged payments over a 24 month period.
63
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 105
ANNUAL FINANCIAL REPORT 2017
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Note
2017
$000’s
2016
$000’s
Operating profit of Ramelius Milling Services Pty Ltd are shown below:
Profit and loss
Sales revenue
Cost of production
Other expenses
Net finance costs
Profit (loss) from discontinued operations before tax
Income tax benefit (expense)
Profit (loss) for year from discontinued operations
7
Assets and liabilities of Ramelius Milling Services Pty Ltd classified as held for sale are below:
Balance Sheet
Current Inventories
Non‐current plant and equipment
Non‐current deferred tax assets
Assets and disposal group classified as held for sale
Non‐current provisions
Non‐current deferred tax liabilities
Liabilities included in disposal group held for sale
122
(75)
‐
‐
47
(14)
33
‐
‐
‐
‐
‐
‐
‐
‐
(534)
243
(31)
(322)
97
(225)
560
1,663
1,002
3,225
2,068
2
2,070
Cash flows generated by Ramelius Milling Services Pty Ltd are shown below :
Operating activities
Net cash used in discontinued operations
92
92
(160)
(160)
Gain on sale of subsidiary is reconciled below:
Cash received
Deferred consideration
Total proceeds received/receivable from sale of subsidiary
Net assets of discontinued operation
Gain on sale of subsidiary
30 Aug 2016
$000’s
527
1,976
2,503
(1,141)
1,362
33 Company Details
Details of the principal place of business and registered office of Ramelius are as follows:
Head Office
Level 1, 130 Royal Street
East Perth, Western Australia 6004
Registered Office
Suite 4, 148 Greenhill Road
Parkside, South Australia 5063
106 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
64
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 30 JUNE 2017
In the directors’ opinion:
a) the financial statements and notes set out on pages 64 to 106, are in accordance with the Corporations Act 2001,
including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements, and
(ii) giving a true and fair view of the consolidated group’s financial position as at 30 June 2017 and of its
performance for the financial year ended on that date, and
b) 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
c) at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed
group identified in Note 27 will be able to meet any obligations or liabilities to which they are, or may become, subject
by the virtue of the deed of cross guarantee described in Note 27.
Note 1(a) confirms that the financial statements also comply with International Financial Reporting Standards as
issued by the International Australian 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.
The declaration is made in accordance with a resolution of the directors.
____________________
Robert Michael Kennedy
Chairman
Adelaide 24 August 2017
65
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 107
ANNUAL FINANCIAL REPORT 2017
Grant Thornton House
Level 3
170 Frome Street
Adelaide, SA 5000
Correspondence to:
GPO Box 1270
Adelaide SA 5001
T 61 8 8372 6666
F 61 8 8372 6677
E info.sa@au.gt.com
W www.grantthornton.com.au
Independent Auditor’s Report
to the Members of Ramelius Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Ramelius Resources Limited (the Company) and its
subsidiaries (the Group), which comprises the consolidated balance sheet as at 30 June 2017, the
consolidated income statement, consolidated statement of comprehensive income, consolidated
statement of changes in equity and consolidated statement of cash flows for the year then ended,
and notes to the consolidated 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 Group’s financial position as at 30 June 2017 and of its
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
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 (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.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
108 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report of the current period. These matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key audit matter
How our audit addressed the key audit matter
Inventory – Note 1(m) and 11
At 30 June 2017, the Group has inventory in the form
of consumable stores including critical spares ($4.61
million), ore stockpiles ($12.82 million), gold in circuit
($8.10 million) and gold bullion on hand ($3.62
million).
The determination of the carrying value and
existence of ore stockpiles, gold in circuit and ore
mined, are significant areas of judgement. This
includes consideration of production through the
application of IFRIC 20 – Stripping Costs in the
Production Phase of a Surface Mine.
This is a key audit matter due to the estimates
utilised in determining the quantities and valuing the
inventory from the various mines.
Provision for Restoration and Rehabilitation –
Note 1(y), 4(g) and 19
As at 30 June 2017, the Group has a liability of
$20.89 million relating to the estimated cost of
rehabilitation, decommissioning and restoring the
Checker Plant site in addition to the current and
previous operating mines.
The provision is based upon current cost estimates
and has been determined on a discounted basis with
reference to current legal requirements and
technology. At each reporting date the rehabilitation
liability is reviewed and re-measured in line with any
changes in observable assumptions, timing and the
latest estimates of the costs to be incurred based on
area of disturbance at reporting date.
The area is a key audit matter as the determination
of the costs of restoration and rehabilitation involves
complexity and significant management judgement.
Our procedures included, amongst others:
• Documenting the processes and assessing the
internal controls relating to the costing of inventory;
• Reconciling the costs of production to the
inventory costing, including testing a sample of
production costs to determine if allocated
appropriately;
• Attending the stocktake at the Mount Magnet site
where a sample of stores and consumable items
were selected from inventory records and
physically verified;
• Attending the Mount Magnet site and physically
verifying the ore stockpiles at year end to
supporting survey data;
• Testing the reasonability of the costs absorbed into
year-end ore, gold in circuit and bullion on hand;
• Reviewing management’s methodology and
assumptions in quantifying stock obsolescence;
and
• Reviewing the appropriateness of the related
disclosures within the financial statements.
Our procedures included, amongst others:
• Obtaining the restoration provision calculation
prepared by management and agreeing to the
general ledger;
• Undertaking an evaluation of managements
experts used in the assessment of the provision
and its assumptions;
• Testing the additions to the provision against our
understanding of the business including new
mines commenced during the year;
• Recalculating the implied interest charges
associated with the time value of money;
• Obtaining an understanding of any restoration
undertaken during the year;
• Considering the inputs into the calculation
including the discount and inflation rates for
comparison to external sources as well as the
expected timing of cash flows; and
• Reviewing the appropriateness of the related
disclosures within the financial statements.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 109
ANNUAL FINANCIAL REPORT 2017
Key audit matter
How our audit addressed the key audit matter
Capital & Development Assets – Notes 1(n), (q),
(r), (s), 4(b), (c), (e) and (f), 14 and 15
The Group incurred expenditure during the year
totalling $43.39 million, associated with stripping of
various pits or development of underground mines
within the Mount Magnet Gold (MMG) cash
generating unit. In addition, there were three
exploration interests totalling $3.47 million that were
transferred to development relating to interests set to
commence stripping or decline within the next 12
months from 30 June 2017.
The evaluation of the recoverable amount of the
assets requires significant judgement in determining
key assumptions supporting the expected future cash
flows and the utilisation of the relevant assets.
This area is a key audit matter due to the level of
judgement and estimation used in the discounted
cashflow models supporting the asset recoverable
values.
Deferred Tax Assets – Notes 1(i), 4(d) and 7
The Group has recognised deferred tax assets,
which include $20.39 million of prior period’s losses
as at 30 June 2017.
Management have brought to account those losses
that are estimated to be probable of utilisation over
the life of mine within the MMG cash generating unit.
This area is a key audit matter given the judgement
required by management in the computation of
losses to be brought to account.
Our procedures included, amongst others:
• Documenting the processes and assessing the
internal controls relating to management’s
assessment of impairment, calculation of deferred
stripping costs and amortisation;
• Obtaining management's reconciliation of capital
and development assets and agreeing to the
general ledger;
• Assessing the determination of cash generating
unit's based on understanding how the Chief
Operating Decision Maker monitors the Group's
operations and makes decisions about the assets
that generate independent cash flows;
• Obtaining management's discounted cash flow
model for the MMG cash generating unit and
analysing for appropriateness against AASB 136
Impairment of Assets, including:
- Understanding management’s
assumptions;
- Performing sensitivity analysis on
assumptions;
- Comparing forecast production against
available reserves;
- Comparing realised production data for the
year against historical forecasts;
• Evaluating management’s experts in relation to
compilation of reserves used in the model
prepared by management;
• Analysing the stripping ratio against management's
experts estimates;
• Comparing amortisation calculations to production
data;
• Comparing the market capitalisation of the
company at 30 June 2017 against the carrying
value of assets; and
• Reviewing the appropriateness of the related
disclosures within the financial statements.
Our procedures included, amongst others:
• Obtaining management's assessment of the
ability to utilise tax losses in the future, including
continuation of ownership analysis and identifying
and assessing the appropriateness of key
assumptions utilised in the model;
• Obtaining available evidence to support the key
assumptions and compared against the life of
mine model used for AASB 136 purposes;
• Testing the mathematical accuracy of the model
used as a basis for the capitalisation of deferred
taxes, as well as its inputs to supporting data;
• Consulting with Grant Thornton tax specialists,
who reviewed the tax computations and undertook
discussions with management; and
• Reviewing the appropriateness of the related
disclosures within the financial statements.
110 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
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 Group’s annual report for the year ended 30 June 2017, but does not
include the financial report and our auditor’s report thereon. The annual report is expected to be
made available to us after the date of this auditor’s report.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
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.
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 related 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.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our
auditor’s report.
Report on 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 2017.
In our opinion, the Remuneration Report of Ramelius Resources Limited, for the year ended 30
June 2017, complies with section 300A of the Corporations Act 2001.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 111
ANNUAL FINANCIAL REPORT 2017
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.
GRANT THORNTON AUDIT PTY LTD
J L Humphrey
Partner – Audit & Assurance
Adelaide, 24 August 2017
112 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
SHAREHOLDER INFORMATION
Ramelius Resources Limited
Shareholder Information
Additional information required by the Australian Securities Exchange Limited Listing Rules and not disclosed
elsewhere in this report is set out below.
Shareholdings as at 14 September 2017
Substantial shareholders
The number of shares held by substantial shareholders and their associates as disclosed in substantial holding notices
given to the Company are set out below:
Substantial shareholder
Ruffer LLP
Van Eck Associates Corporation
Number of fully paid
ordinary shares held
38,085,104
31,314,882
Voting rights
Fully paid ordinary shares
Other than voting exclusions as required by the Corporations Act 2001 and subject to any rights or restrictions attached
to any class of shares, at a meeting of members, on a show of hands, each member present (in person, by proxy,
attorney or representative) has one vote and on a poll, each member present (in person, by proxy, attorney or
representative) has one vote for each fully paid share they hold.
Options and performance rights
Details of options and performance rights on issue by the Company as at 14 September 2017 are as follows.
Expiry date
11/6/2018 ^
11/6/2019 ^
11/6/2020 #
1/7/2024 ^
1/7/2025 #
11/6/2026 #
1/7/2026 #
1/7/2027 #
Exercise price
Number of Options
Number of Performance
Rights
1,500,000
1,500,000
1,500,000
$0.29869 *
$0.20
$0.20
Nil
Nil
Nil
Nil
Nil
909,022
858,451
500,000
858,442
3,257,833
Option and performance right holders will be entitled on payment of the exercise price shown above to be allotted one
ordinary fully paid share in the Company for each option/performance right exercised.
* As result of 1:4 Rights issue in July 2014, exercise price reduced from $0.30 to $0.29869 in accordance with the terms
of the options.
^ These options/performance rights are exercisable in whole or in part at any time until the expiry dates. Any options /
performance rights not exercised before expiry will lapse.
# These options/performance rights are subject to vesting conditions and once vested are exercisable in whole or in
part at any time until the expiry dates. Any vested options/performance rights not exercised before expiry will lapse.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 113
SHAREHOLDER INFORMATION
Ramelius Resources Limited
Shareholder Information
Distribution of equity security holders
Ordinary Shares & Options
Category
Holders of
Quoted
Ordinary
shares
Holders of
Unquoted
11 June 2018
$0.29869
Options
Holders of
Unquoted
11 June 2019
$0.20
Options
Holders of
Unquoted
11 June 2020
$0.20
Options
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total number of security holders
899
1,702
1,102
2,741
546
6,990
1
1
1
1
1
1
The number of shareholders holding less than a marketable parcel of ordinary shares is 1,027.
All unquoted options are held by the Company’s Managing Director and Chief Executive Officer, Mr Mark Zeptner.
Performance Rights
Category
Holders of
Unquoted
1 July 2024
Performance
Rights
Holders of
Unquoted
1 July 2025
Performance
Rights
Holders of
Unquoted
11 June 2026
Performance
Rights
Holders of
Unquoted
1 July 2026
Performance
Rights
Holders of
Unquoted
1 July 2027
Performance
Rights
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total number of security holders
On market buy-back
There is no current on-market buy-back.
10
3
13
9
3
12
1
1
9
3
12
16
16
114 RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017
Ramelius Resources Limited
Shareholder Information
Twenty largest shareholders
The names of the 20 largest holders of fully paid ordinary shares constituting a class of quoted equity securities on the
Australian Securities Exchange Limited including the number and percentage held by those holders at 14 September
2017 are as follows.
Name
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
Stramig Holdings Pty Ltd
CS Fourth Nominees Pty Limited
BNP Paribas Noms Pty Ltd
Mandurang Pty Ltd
Bell Potter Nominees Ltd
Pershing Australia Nominees Pty Ltd
Brispot Nominees Pty Ltd
Citicorp Nominees Pty Limited
Buttonwood Nominees Pty Ltd
ABN Amro Clearing Sydney Nominees Pty Ltd
BNP Paribas Nominees Pty Ltd
National Nominees Limited
Mr George Chien Hsun Lu & Mrs Jenny Chin Pao Lu
Aurelius Resources Pty Ltd
Pershing Australia Nominees Pty Ltd
Southern Cross Capital Pty Ltd
Triple Eight Gold Pty Ltd
Unquoted and restricted equity securities
Fully paid ordinary Shares
There are no unquoted restricted fully paid ordinary shares on issue.
Number of fully
paid ordinary
shares held
114,739,955
49,155,339
24,461,600
9,500,000
9,146,382
8,372,180
8,053,570
5,000,000
4,250,000
4,148,977
3,883,669
3,255,000
3,225,000
3,202,049
2,648,555
2,489,000
2,074,091
2,000,000
1,905,000
1,747,219
263,257,586
Percentage
held
21.78
9.33
4.64
1.80
1.74
1.59
1.53
0.95
0.81
0.79
0.74
0.62
0.61
0.61
0.50
0.47
0.39
0.38
0.36
0.33
49.97
Options and performance rights
Details of options and performance rights on issue as at 14 September 2017 which are unquoted restricted securities
held by employees as long term incentives are as follows.
Date until securities
are restricted
11 June 2018 *
11 June 2019 *
11 June 2020 **
1 July 2024 ^
1 July 2025 ^^
11 June 2026 ^^
1 July 2026 ^^
1 July 2027 ^^
Number of unquoted
securities on issue
1,500,000
1,500,000
1,500,000
909,022
858,451
500,000
858,442
3,257,883
Number of
holders
1
1
1
13
12
1
12
16
Vesting
date
-
-
11 June 2018
-
1 July 2018
11 June 2019
1 July 2019
1 July 2020
Exercise
Price
$0.29869
$0.20
$0.20
Nil
Nil
Nil
Nil
Nil
Exercisable
until
11 June 2018
11 June 2019
11 June 2020
1 July 2024
1 July 2025
11 June 2026
1 July 2026
1 July 2027
These securities are vested options which may not be transferred or used as collateral.
*
** These securities are unvested options exercisable when vested which may not be transferred or used as collateral.
^
^^ These securities are unvested performance rights exercisable when vested which may not be transferred or used as
These securities are vested performance rights which may not be transferred or used as collateral.
collateral.
RAMELIUS RESOURCES LIMITED ANNUAL REPORT 2017 115
AUSTRALIAN SECURITIES EXCHANGE
Code: RMS
Listed on Australian Securities Exchange Limited
Exchange Centre, 20 Bridge Street
SYDNEY, NSW, 2000
SHARE REGISTRAR
Location of Share Register
Computershare Investor Services Pty Limited
Level 5, 115 Grenfell Street
ADELAIDE SA 5000
Telephone: 1300 556 161 (within Australia),
+ 61 3 9415 4000 (outside Australia)
Facsimile: 1300 534 987 (within Australia),
+ 61 3 9473 2408 (outside Australia)
Enquiries: www.investorcentre.com/contact
AUDITORS
Grant Thornton
Chartered Accountants
Level 3, 170 Frome Street
ADELAIDE SA 5000
LAWYERS
DMAW Lawyers Pty Ltd
Level 3, 80 King William Street
ADELAIDE SA 5000
CORPORATE DIRECTORY
PRINCIPAL REGISTERED OFFICE
RAMELIUS RESOURCES LIMITED
Suite 4, 148 Greenhill Road
PARKSIDE SA 5063
PO Box 506 UNLEY SA 5061
Telephone: (08) 8271 1999
Facsimile: (08) 8271 1988
Email: info@rameliusresources.com.au
Website: www.rameliusresources.com.au
PERTH OPERATIONS OFFICE
Level 1, 130 Royal Street
EAST PERTH WA 6004
PO Box 6070 EAST PERTH WA 6892
Telephone: (08) 9202 1127
DIRECTORS, SENIOR MANAGEMENT
AND CONSULTANTS
ROBERT MICHAEL KENNEDY
KSJ, ASAIT, Grad. Dip. (Systems Analysis),
Dip. Financial Planning, Dip. Financial Services,
FCA, CTA, AGIA, Life Member AIM, FAICD, MRSASA
Independent Non-Executive Chairman
MARK WILLIAM ZEPTNER
BEng (Hons) Mining, MAusIMM, MAICD
Managing Director and Chief Executive Officer
KEVIN JAMES LINES
BSc (Geology), MAusIMM, MAICD
Independent Non-Executive Director
MICHAEL ANDREW BOHM
BAppSc (Mining Engineering), MAusIMM, MAICD
Independent Non-Executive Director
DOMENICO ANTONIO FRANCESE
BEc, FCA, FFin, ACIS, AGIA
Company Secretary
TIMOTHY PETER MANNERS
BBus (accounting), FCA, AGIA, MAICD
Chief Financial Officer
DUNCAN COUTTS
BEng (Hons) Mining, MAusIMM, MAICD
Chief Operating Officer
KEVIN MARK SEYMOUR
BSc, (Geology), MAusIMM,
General Manager, Exploration
& Business Development