Annual Report
for the year ended
31 DECEMBER
2023
w w w. h i l l g r o v e r e s o u r c e s . c o m . a u
Hillgrove Resources Limited ACN 004 297 116
CORPORATE DIRECTORY
Corporate and Registered Office
5-7 King William Road,
Unley S.A. 5061, Australia
Tel: + 61 8 7070 1698
Kanmantoo Copper Mine
440 Mine Road
Kanmantoo S.A. 5252, Australia
Tel: + 61 8 8538 6800
Share Registry
Boardroom Pty Limited
Level 8, 210 George Street
Sydney N.S.W. 2000, Australia
Tel: + 61 2 9290 9600
Fax: + 61 2 9279 0664
Bankers
Westpac Banking Corporation
31 Willoughby Road
Crows Nest N.S.W. 2065, Australia
Auditors
PricewaterhouseCoopers
70 Franklin Street
Adelaide S.A. 5000, Australia
Web Site
www.hillgroveresources.com.au
General Enquiries
info@hillgroveresources.com.au
CONTENTS
Chairman and Managing Director’s Statement
Hillgrove Projects
Mineral Resource
Exploration Target
Financial Report
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
1
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11
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55
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Chairman and Managing Director’s Statement
Dear Shareholders,
At the beginning of the 2023 year, the
Company set out to become Australia’s
next copper producer, which we’re
pleased to say became a reality when
first concentrates were produced and
sold post year end in February 2024 1.
In achieving this goal, the Company
completed a number of significant
milestones during the year. These
include:
½ The release of an Updated Economic
Assessment in February 2023 2;
½ A successful capital raising to fund
the restart at Kanmantoo in March
2023;
½ Commencement of Underground
development in May 2023;
½ The Board formally announcing a
positive final investment decision in
June 2023;
½ Commencement of bulk mining in
December 2023; and
½ Commissioning of the crusher in
December 2023.
Whilst the Company is focussed
on delivering the Underground, we
continue to also look to add value
by expanding mine life and annual
copper production through on-lease
exploration. In 2023, we drilled around
25km, aimed at both infill drilling for
stope definition and expanding the
mine life with some excellent results
including:
½ A step out hole in Spitfire more than
100m from any previous copper
intercept which returned 45.4 metres
at 1.19% Cu and 0.12g/t Au 3; and
½ Down dip extensions in Emily Star
that include 71.7 metres at 0.89% Cu
and 68.8 metres at 0.9% Cu 4.
Furthermore, in October we announced
the discovery of Kanmantoo Deeps, a
large and low resistivity anomaly, 1km
in strike length, which is coincident with
both a strong ground gravity and heli-
magnetic anomaly.
Mr Derek Carter
Independent Non-Executive
Chairman
Mr Lachlan Wallace
Chief Executive Officer and
Managing Director
It returns a similar resistivity signature to the main lode system and is
potentially a northern continuation that has been offset down plunge by
a recently identified fault. The Exploration Target immediately around the
process plant is now 60 to 100 million tonnes at 0.9% to 1.2% Cu and 0.1g/t
to 0.2g/t Au 5, which is an order of magnitude above our existing mining
inventory and represents a material opportunity for the Company.
With the restart of operations at Kanmantoo, we continue to enjoy strong
support from the local Kanmantoo and Callington communities where the
company has a long-standing positive presence, due in large part to our
record on environmental stewardship. This was demonstrated again this year
as we assisted local landholders and community groups to secure a $1.3m
grant from the Native Vegetation Council to create an important regional
greenbelt. The grant enables a multi-kilometre greenbelt which connects the
existing mining rehabilitation works at Kanmantoo with regional vegetation
initiatives across multiple private landholdings, including parcels of Hillgrove’s
land surrounding the mine site, providing linkages for ground-based fauna
and birdlife between disparate vegetation patches, and restoring important
ecological diversity to the region.
Finally, we would like to thank all the various stakeholders that have helped
us achieve our goal of becoming Australia’s latest copper producer – and in
particular all our shareholders, our employees and staff, the local and state
governments, and our contractors for their dedicated efforts and support to
the Company.
Mr Derek Carter
Chairman
Mr Lachlan Wallace
Managing Director
1
2
3
4
5
Refer ASX announcement 12 February 2024.
Refer ASX announcement 27 February 2023.
Refer ASX announcement 28 August 2023.
Refer ASX announcement 3 July 2023.
Refer ASX announcement 11 October 2023. The Exploration Target is conceptual in
nature as there has been insufficient exploration to define a Mineral Resource. It is
uncertain if further exploration will result in the determination of a Mineral Resource under
the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves, the JORC Code” (JORC 2012). The Exploration Target is not being reported as
part of any Mineral Resource or Ore Reserve.
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Hillgrove Projects
KANMANTOO UNDERGROUND DEVELOPMENT
Hillgrove Resources Limited’s (Hillgrove)
flagship project is the Kanmantoo Copper
Mine in South Australia, located 55
kilometres from Adelaide. The site is in an
enviable position, being close to road, rail,
power, water, port facilities, and enjoying
access to a large pool of specialised
contractors and potential employees.
WEST
318200 Em
4 m
318 00 E
EAST
Giant Open Pit
Completed 2019
0m
110 RL
The exploration and mining lease is
scattered with historical copper and base
metal operations and includes the former
Kanmantoo Copper Mine, a medium sized
copper mine that operated from 1971 to
1976 as an open pit and underground
operation. Hillgrove re-opened the mining
operations in 2011 and operated an
open pit operation until 2020. With the
completion of the open pit, the plant
was placed on care and maintenance as
exploration and economic assessments
were undertaken for the Kanmantoo
Underground (Underground).
Following the release of the Updated
Economic Assessment for the
Underground, the Company announced a
successful capital raising in March 2023.
Early works commenced immediately
thereafter, culminating in a formal positive
final investment decision in June 2023
and the commencement of Underground
development.
As the underground development
commenced, the ground conditions
proved to be very competent, helping
to turn the development faces over
quickly and enabling the development
rates to ramp up to plan immediately. In
late 2023, the primary ventilation circuit
and a secondary means of egress were
established, enabling stoping activities to
commence, with first stope blast occurring
towards the end of 2023.
Post year-end, the processing plant
was commissioned, copper production
commenced, and the first copper
concentrate from the underground was
delivered to the point of sale at Port
Adelaide, thus making Hillgrove Australia’s
newest copper producer.
Current UG Decline
0m
80 RL
45.4
KTDD243W1
m @ . %
incl. 6.6m @ 2.31%Cu
& 0.23g/t Au
1 19 Cu
Drill Hole &
Blast Hole
Grades (%Cu)
> .1 0
8 1 0
-
0.
.
8
6
- 0.
0.
0.4 - 0.6
0.1 - 0.
4
5
< 0. 51
2022 MIK MRE
Indicated
Inferred
KTDD243W1
m @ . %
1 71 Cu
4.3
KTDD243W1
Cross Section Looking North
All HGO Drilling & 2022 MIK MRE
243W1
D
D
KT
0
100
0m
60 RL
metres
Figure 1: Cross Section of KTDD243W1.
KANMANTOO MINE LEASE EXPLORATION
The Company has continued to explore the Cu-Au endowment on the Kanmantoo
Mine Lease. In 2023, two zones of special interest have been drilled (Spitfire
and Emily Star) and a large new zone has been identified (Kanmantoo Deeps).
All zones are accessible via the newly established underground development,
showcasing promising prospects for future utilisation.
Spitfire
Exploration drilling to explore the down dip of the Spitfire Cu-Au zone intersected
by the underground diamond drilling, returned 6:
½ 45.4m @ 1.19% Cu, 0.12 g/t Au from 428.5m downhole (KTDD243_W1),
including:
½
½
½
5.35m @ 2.13 % Cu, 0.11 g/t Au from 428.5m downhole, and
23.9m @ 1.53 % Cu, 0.12 g/t Au from 444m downhole, including
6.6m @2.31% Cu, 0.23 g/t Au from 460.4m downhole.
The Spitfire drilling demonstrates that there are wide zones of higher grade Cu-Au
breccia within 100m from and adjacent to, the planned Underground development
and which are not included in any current mineral resource estimate.
6
ASX release 28 August 2023 100m step out hole hits 45.4m @ 1.2% Cu.
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Hillgrove Projects (cont.)
Emily Star
The Company drilled four holes into the Emily Star lode system 7
located in the South Hub area. Drilling has continued to intersect
strongly mineralised alteration zones hosting higher grade Cu-Au
breccia zones and include 8:
½ KTDD239 – 71.7m @ 0.89% Cu including:
½
½
½
9.7m @ 1.29% Cu, 0.14 g/t Au from 135.6m downhole
4.0m @ 2.9% Cu, 0.61 g/t Au from 159.3m downhole
20.2m @ 1.7% Cu, 0.69 g/t Au from 178.8m downhole
½ KTDD239 – 8.4m @ 0.96% Cu, 0.06 g/t Au
from 277.2m downhole
½ KTDD240 – 68.75m @ 0.9% Cu including:
½
½
4.8m @ 1.39% Cu, 0.09 g/t Au from 169.5m downhole
35.1m @1.29% Cu, 0.08 g/t Au from 192.2m downhole.
KANMANTOO DEEPS
Geophysical surveys on the Kanmantoo Mine Lease have
discovered a coincident conductivity, gravity, magnetic
target that is 400 metres along strike of the known
Kanmantoo Cu-Au mineralisation and may represent a
repeat of the entire Kanmantoo Cu-Au deposit 9.
The Kanmantoo Deeps zone has been identified by a 3D
AMT/MT 10 geophysical survey undertaken at Kanmantoo
in 2023. Inversions of the MT resistivity data all identified
a zone of high conductivity (<30 ohm.m) located around
400 metres north of the underground operation and along
strike of the known Kavanagh Cu-Au mineral system. The
recent drilling of the North Kavanagh Cu-Au zone 11 is now
interpreted as the stringer mineralisation up-dip of the
Kanmantoo Deeps conductivity zone.
1 00m
6 144
N
1 00 Em
6 146
1 00 Em
6 148
1 00 Em
6 150
1 00 Em
6 152
SOU HT
original surface
Emily Star
Open Pit
South Emily
Cu-Au
Paringa
Cu-Au
KTDD239
1 7 Cu, 0.69g/t Au
m @ . %
20.2
KTDD240
m @ . %
1 29 Cu
35.1
Kavanagh Lodes
Open Pit
Drill Hole &
Blast Hole
Grades (%Cu)
> .0 8
6 0 8
0.
-
.
6
4
- 0.
0.
0.2 - 0.4
< 20.
Emily Star to Kavanagh Decline
Oblique Long Section
All HGO Drilling
0
200
metres
Figure 2: Long section of KTDD239 and KTDD240.
NOR HT
0m
100 RL
UG Decline
0m
80 RL
0m
60 RL
7
8
Refer ASX announcement 3 July 2023.
Intercepts tabulated in the Highlights table are amalgamated over a minimum down hole length of 2m > 0.4% Cu with a maximum of
2m internal dilution < 0.4% Cu. No assays were cut before amalgamating for the intercept calculation.
9
Refer ASX announcement 11 October 2023.
10 Magnetotellurics (MT) and Audio-frequency MT (AMT) are electro-magnetic survey and imaging techniques that use naturally-occurring
ionospheric current sheets and lightning storms — passive energy sources — to map geologic structures to depths of 1500 meters
or more.
11 Refer ASX announcement 27 February 2023.
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Hillgrove Projects (cont.)
KANMANTOO DEEPS (cont.)
1 00m
6 145
N
SOU HT
1 00 Em
6 150
1 00 Em
6 155
1 00 Em
6 160
Giant Open Pit
Completed 2019
North Kavanagh
Drilling
UG Decline
KTDD205
m @ . %
1 01 Cu
170.65
KTDD202_W3
m @ . %
1 5 Cu
20
KTDD203_W4
m @ . %
1 5 Cu
4.55
30 ohm.m
20 ohm.m
1066 Fault
KTDD243_W1
m @ . %
1 2 Cu
45.4
2023 MT Stations
Resistivity (ohm.m)
< 20
20 - 30
30 - 60
60 - 80
80 - 100
100 - 250
250 - 500
500 - 750
750 - 1000
> 1000
NOR HT
0m
100 RL
0m
50 RL
0mRL
0
250
metres
Kanmantoo Deeps Long Section
Inversion Model of MT Resistivity
All HGO drilling from 2004
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Figure 3: Kanmantoo Deeps Long Section.
Geophysically, the MT conductivity zone
is coincident with the high gravity anomaly
reported by HGO in 2015 12, and with a
high magnetic zone reported in 2018 13. These
geophysical responses are all consistent with
geology of the mineralisation where the Cu-
Au is associated with pyrrhotite/chalcopyrite,
magnetite and garnet alteration.
The discovery of the Kanmnatoo Deeps
zone beneath the stringer style mineralisation
at North Kavanagh has resulted in a re-
evaluation of numerous Cu-Au zones on the
Kanmantoo Mine Lease and in the Near Mine
Exploration Prospects.
12 Refer ASX announcement 13 April 2015.
13 Refer ASX announcement 8 May 2018.
Hillgrove Projects (cont.)
NEAR MINE EXPLORATION
315000 Em
320000 Em
Regional Structural Corridors
61200 0 N0 m
North West
Kanmantoo
Mine Corridor
Mine Lease
Kanmantoo
Town
North Hub
Cu-Au
Open Pits
Kanmantoo Deeps
61150 0 N0 m
South Hub
Stella Area
The Company continues to hold
the Cu-Au prospects within 10 kms
of the Kanmantoo processing
plant as high value targets for
future drilling and evaluation for
processing options. These include
the previously announced 14 South
Kanmantoo, Stella, Mullewa
and North West Kanmantoo
geochemical and geophysical
targets. These prospects all
have similar geochemical and
geophysical signatures as the
Kanmantoo and the Kanmantoo
Deeps MT mineral system.
14 Refer ASX announcement
29 April 2019.
NORTH
0
1
kilometre
Kanmantoo Exploration Targets
(on Aeromagnetics TMI 1VD)
Figure 4:
Plan view of the location
of projects within
10km of Kanmantoo Copper Mine
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Hillgrove Projects (cont.)
REGIONAL EXPLORATION
Dukes Project and Milendella Project
(South East Kanmantoo Province)
The Regional area comprises 5,652 sq kms of exploration licences in the
south-east of South Australia over a mineralised sequence of Cambro-Ordovician
sediments, volcanics and felsic intrusives known as the Kanmantoo Province.
The Company’s tenements have been divided into two Project areas reflecting
both geography and geology differences as shown on Figure 5. The Milendella
Project as centre along the Coorong Shear Zone and is prospective for porphyry
Cu-Au mineral systems. The Dukes Project is focused along the Dundas-Flinders
Shear Zone and is prospective for “Winu” style sediment hosted Cu-Au
Mineral Systems.
138°E
S O U T H
A U S T R A L I A
140°E
Curnamona
Craton
Broken Hill
142°E
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32°S
Port Augusta
Anabama Cu-Mo
Bendigo Cu-Mo
Adelaide
Rift
Complex
Gawler Craton
L och Lily K ars B elt
Mt WrightArc Volcanics
MAP
LOCATION
N E W S O U T H
HGO Milendella Project
Kanmantoo Province
ADELAIDE
V I C T O R I A
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Kanmantoo Cu-Au
S o u t h e r n
O c e a n
HGO Cu, Au sites
Other Cu, Au sites
HGO Dukes Project
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Dundas-Flinders
Shear Zone
(on TMI Airmagnetics)
NORTH
0
10 km0
Figure 5: Dukes and Milendella Projects.
e
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38°S
15 Geology of Winu-Ngapakarra, Great Sandy Desert of Western Australia,
a recently discovered intrusion -related Cu-Au deposit. Economic Geology 2023,
V 118: N 5, pp 967-998.
DUKES PROJECT
The Dukes Project is centred approximately
150kms via existing roads from the
Kanmantoo processing plant.
Over the past few years, Hillgrove has
collected petrological and whole rock assay
data from legacy drill core throughout the
Project area and integrated this data with the
Company’s data and mapping at Kanmantoo.
As a result, a new preliminary Mineral System
Model has been proposed that is similar to
the “Winu” 15 mineral system model in the
Paterson province of northern WA.
The key elements of the model are:
1. Copper fertile basement of Truro
volcanics (identified by WMC in their
early search for Cu in Sth Aust).
2. Sedimentary basin of turbidite to
carbonate sequences.
3. Proximal to major lineament/crustal
structure.
4. At least two periods of dynamic
5. Significant multiphase intrusive activity,
with one phase being oxidised.
6. A contact metamorphic system that
overprints the first dynamic deformation
(characterised by biotite & andalusites).
7. A retrograde magmatic thermal
alteration system along the same
structural zones.
36°S
8. Mineralisation with a retrograde thermal
paragenesis within dilational structures
within the thermal plume.
All of these elements occur in the Dukes
Project area, and previous geochemical and
structural targets are being re-evaluated
in view of this new Mineral System Model.
The resulting set of Cu-Au prospects with
“Winu” style alteration systems is shown in
Figure 6. Over the past year Hillgrove has
commenced soil geochemical sampling to
assist in prioritising copper prospects for
further prospect scale geophysical targeting.
W A L E S
34°S
deformation.
Hillgrove Projects (cont.)
REGIONAL EXPLORATION (cont.)
139°E
EL6526
139°30'E
140°E
Kanappa Cu-Au
EL6526
Kanmantoo Cu-Au
Firehawk
EL6294
Murray Bridge
Dundas-Flinders
Shear Zone
Hillgrove has previously reported
the results of the diamond drilling at
Kanappa that intersected copper-gold
mineralisation within a skarn mineralising
system. KPDDH003 17 intersected 45
metres at 0.2% copper, from 47 metres,
including two higher grade zones:
35 S°
½ 5.5m @ 0.47% Cu from 69.5m
downhole; and
½ 4.5m @ 0.65% Cu from 85.0m
downhole.
Direzza
EL6208
35
S°30'
EL6174
EL6175
S o u t h e r n
O c e a n
Eagle
Zeon
Geophysical Targets
Cu & Metal Occurrences
Cu Fertile Igneous Rocks
All Exploration Targets
South East SA
HGO Tenements
(on TMI Airmagnetics)
0
NORTH
2 km0
EL6207
EL6397
3 S6°
Keith
Figure 6: Dukes Project.
MILENDELLA PROJECT
- Kanappa and Mt Rhine Copper-Gold Prospects
In recent presentations and publications by the Geological Survey of South Australia
(GSSA) 16 and CODES, University of Tasmania the similarities between the tectonic
setting and its high-level granitic to dioritic intrusives in the Kanmantoo Province of
south-east South Australia, with the geology of the large Porphyry Cu systems in the
Macquarie Arc of eastern Australia has been noted. The Milendella Project along the
Coorong Shear Zone is an area of Cu fertile magmatic systems within two prospects,
Kanappa and Mt Rhine. Activities in this Milendella Project are being undertaken in
conjunction with the GSSA and Minex-CRC’s South-East South Australian magmatic
related copper-gold initiative.
A review of the whole rock geochemistry
of the monzonites intersected by the drill
holes shows that the magmatic system
is classified as a Volcanic Arc Granite
and classified within the Loucks (2014)
porphyry fertility field.
These drill results confirm the
Company’s view that the Kanappa area
is prospective for large scale magmatic
related copper-gold mineral deposits and
is consistent with GSSA’s stated views
of the prospectivity of this portion of the
Kanmantoo Province for Cu porphyry
systems. Further work is continuing in
the area.
The Mt Rhine prospect is 15 kms north
of Kanappa where surface rock chips
have shown Cu-Au mineralisation over a
1.7km long zone of skarn alteration and
sulphides. Peak rock chips include
49.8 g/t Au and 13.1% Cu (different
samples) 18.
16 Metallogenic setting and temporal
evolution of porphyry Cu-Mo
mineralization and alteration in the
Delamerian Orogen. Economic Geology
2023 V118, N 6, pp 1291 - 1318.
17 Refer ASX announcement
30 January 2019.
18 Refer ASX announcement
25 October 2017.
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Mineral Resource
MINERAL RESOURCES FOR KANMANTOO
As at 31 December 2023
The Table below summarises the Kanmantoo Mineral Resource Estimates (MRE) which includes the updated 2022 Kavanagh
and 2022 Nugent MRE 19 below the Giant and Nugent open pits respectively.
Table 1: Mineral Resource Estimate for the Underground
Deposits
Kavanagh 2022
(0.6% Cu COG)
Nugent 2022
(0.7% Cu COG)
Totals
JORC 2012
Classification
Measured
Indicated
Inferred
Sub-Total
Indicated
Inferred
Sub-Total
Measured
Indicated
Inferred
Total
Tonnage
(kt)
780
3,640
1,300
5,750
865
400
1,270
780
4,505
1,700
6,985
Cu
(%)
1.28
1.03
1
1.1
1.19
1.1
1.18
1.28
1.06
1
1.08
Au
(g/t)
0.1
0.06
0.1
0.1
0.64
0.3
0.54
0.1
0.2
0.1
0.16
Cu Metal
(kt)
9.9
38
10
61
10.3
5
15
9.9
48
15
75.9
Note: Due to appropriate rounding, numbers may not sum.
The information in this release that relates to the Exploration Results and Mineral Resource Estimates is based upon information
compiled by Mr Peter Rolley, who is a Member of The Australian Institute of Geoscientists. Mr Rolley is a full-time employee
of Hillgrove Resources Limited and has sufficient experience relevant to the styles of mineralisation and type of deposit under
consideration 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 (JORC Code)’. Mr Rolley has consented to the inclusion in the release
of the matters based on their information in the form and context in which they appear.
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19 Refer ASX announcement 11 May 2022 and 26 July 2022 respectively.
Exploration Target
EXPLORATION TARGET FOR KANMANTOO as at 31 December 2023
The Table below summarises the
Kanmantoo Exploration Target which
excludes the updated 2022 Kavanagh
and 2022 Nugent MRE’s and was
updated during 2023 20.
The Exploration Target is conceptual
in nature as there has been insufficient
exploration to define a Mineral Resource.
It is uncertain if further exploration will
result in the determination of a Mineral
Resource under the “Australasian Code
for Reporting of Exploration Results,
Mineral Resources and Ore Reserves,
the JORC Code” (JORC 2012).
The Exploration Target is not being
reported as part of any Mineral Resource
or Ore Reserve.
The Exploration Targets fall into three
regions (see Table 2).
Region A comprises six zones that are
all located on the Mine Lease and are
outside of the current Mineral Resource
Estimates and outside of the past open
pit mining operations. The identification
and location of these six target zones is
predominantly based upon depth and
strike extensions of copper-gold zones
that have been mined within the open
pit or intersected by diamond drilling
undertaken by Hillgrove. These zones
include Kavanagh, Nugent, Emily Star,
Paringa, North Kavanagh and Coopers.
The Exploration Target for these
zones has been previously described
and reported and is unchanged
(23/03/2023).
Region B are two zones that are located on the adjacent Exploration Licence at
Kanmantoo that surrounds the Mine Lease. These zones are within 500m of the
Kanmantoo Mine Lease boundary and comprise South Kanmantoo and Stella. The
identification of these two target zones is based upon depth and strike extensions
of copper-gold zones that have been intersected by percussion and/or diamond
drilling undertaken by Hillgrove. The Exploration Target for these two zones has been
previously described and reported and is unchanged (23/03/2023).
Region C is the new Kanmantoo Deeps zone that has been identified by the recent
3D AMT/MT geophysical survey at Kanmantoo as described above.
Table 2: Summary of the Exploration Target by zone
Exploration Target
Tonnage
Range
Grade Range Grade Range
Deposit
Kavanagh
Nugent
Emily Star
Paringa
North Kavanagh
Coopers
Max RL
Depth
400
600
600
600
600
600
(Mt)
4 - 6
2 - 4
1 - 4
1 - 2
1 - 2
1 - 2
Kanmantoo Deeps
600 - 000
50 - 80
TOTAL MINE LEASE
60 - 100
(Cu %)
1.0 - 1.4
0.8 - 1.3
0.8 - 1.2
0.8 - 1.2
0.8 - 1.2
0.8 - 1.2
0.8 – 1.2
0.9 - 1.2
(Au g/t)
0.1 - 0.3
0.3 - 0.5
0.1 - 0.2
0.2 - 0.3
0.1 - 0.2
0.1 - 0.2
0.1 – 0.2
0.1 - 0.2
South Kanmantoo
(EL6526)
Stella (EL 6526)
600
600
2 - 4
2 - 4
0.8 - 1.2
0.8 - 1.2
0.1 - 0.3
0.1 - 0.3
The information in this report that relates to Exploration Target and Exploration
Results is based on and fairly represents information and supporting documentation
compiled by Peter Rolley, a Competent Person, a full-time employee of Hillgrove
Resources Limited, and a member of the Australian Institute of Geoscientists.
Mr Rolley has sufficient experience that is relevant to the style of mineralisation and
type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the 2012 edition of the ‘Australian Code for
Reporting Exploration Results, Mineral Resources and Ore Reserves’. Mr Rolley
consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
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Exploration Target (cont.)
317500 Em
318000 Em
318500 Em
Coopers
North Kavanagh
Matthew
Valentine
Giant Open Pit
Completed 2019
61155 0 N0 m
Kanmantoo Deeps
Conductivity Target
at 500mRL
1066 Fault
Kavanagh
61150 0 N0 m
Spitfire
Emily Star Open Pit
Completed 2015
Emily Star
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Nugent
61145 0 N0 m
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South
Kanmantoo
Paringa
10
Stella
Figure 7: Plan view of Kanmantoo 2023 Conductivity Target at 500mRL.
Drillhole (% Cu)
> 1.0
0.8 - 1.0
0.4 - 0.8
0.2 - 0.4
Blast Hole (% Cu)
> 1.0
61140 0 N0 m
NORTH
0
250
m
etre
s
Kanmantoo
2023 Conductivity Target at 500MRL
(All Exploration Drilling)
FINANCIAL REPORT for the year ended 31 DECEMBER 2023
These financial statements are the consolidated financial statements
for the consolidated entity consisting of Hillgrove Resources Limited
and its subsidiaries. The financial statements are presented in
Australian dollars.
Hillgrove Resources Limited is a company limited by shares,
incorporated and domiciled in Australia. Its registered office and
principal place of business is:
Hillgrove Resources Limited
Ground Floor, 5-7 King William Road, Unley, South Australia 5061
The financial statements were authorised for issue by the Directors
on 26 February 2024. The Directors have the power to amend and
reissue the financial statements.
Through the use of the internet, we have ensured that our corporate
reporting is timely and complete. All press releases, financial reports
and other information are available at the Investors page on our website
www.hillgroveresources.com.au.
Contents
Directors’ Report
Remuneration Report (audited)
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
Consolidated Statement of
Financial Position
Consolidated Statement of
Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated
Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information for
Listed Public Companies
12
18
27
28
29
30
31
32
54
55
60
11
Directors’ Report
The Directors present their report on the consolidated entity (referred to hereafter as “the Group”) consisting of
Hillgrove Resources Limited (Hillgrove or the Company) and the entities it controlled during the 12 months ended
31 December 2023.
PRINCIPAL ACTIVITIES
Hillgrove is an Australian mining company listed on the Australian Securities Exchange (ASX: HGO) and focused on the
development of the Kanmantoo Underground Copper Mine in South Australia and mineral exploration in the south-east of South
Australia. The Kanmantoo Copper Mine is located 55 kilometres from Adelaide in South Australia.
DIRECTORS AND OFFICERS
The Directors and Officers of the Company during the whole of the financial year and up to the date of this report are:
Name/Qualifications
Experience and Special Responsibilities
Mr Derek Carter
Qualifications
Experience
Independent Non-Executive Chairman / Chairman Nomination and Remuneration
Committees
BSc, MSc, FAusIMM
Derek has over 50 years’ experience in exploration and mining geology and management. He held
senior positions in Burmine Ltd and the Shell Group of Companies where he was responsible for
discovering the Los Santos tungsten deposit in Spain, before founding Minotaur Gold NL in 1993. He
resigned as Chairman of Minotaur Exploration Ltd in November 2016. Derek was awarded AMEC’s
Prospector of the Year Award (jointly) in 2003 for the discovery of the Prominent Hill copper-gold
deposit, the AusIMM President’s Award and is a Centenary Medallist. Derek is currently the Chairman
of Petratherm Limited (ASX: PTR).
Derek is a member of the Audit and Risk Committee.
Appointed 24 April 2020.
Mr Murray Boyte
Independent Non-Executive Director / Chairman Audit and Risk and Treasury Committees
Qualifications
Experience
BCA, CA, MAICD
Murray has over 35 years’ experience in merchant banking and finance, undertaking company
reconstructions, mergers and acquisitions in Australia, New Zealand, North America and Hong Kong.
Murray holds a Bachelor of Commerce and Administration from the Victoria University in Wellington
and is a member of the Australian Institute of Company Directors, the Institute of Directors of New
Zealand and Chartered Accountants Australia & New Zealand. In addition, Murray has held executive
positions and directorships in the transport, horticulture, finance service, investment, health services
and property industries. Murray is currently the Chairman of Eureka Group Holdings (ASX: EGH),
Chairman of National Tyre & Wheel Limited (ASX: NTD), and a Non Executive Director of Eumundi
Group (ASX: EBG).
Murray is a member of the Nomination and Remuneration Committees.
Appointed 10 May 2019.
Mr Roger Higgins
Independent Non-Executive Director
Qualifications
Experience
BE (Hons), MSc, PhD, FAusIMM, FIEAust
Roger has over 50 years of experience in the resources industries, including being a former Managing
Director of Ok Tedi Mining Limited in Papua New Guinea and Senior Vice President Copper at
Canadian metals and mining company Teck Resources Limited. He was also Vice President and
Chief Operating Officer with BHP Base Metals (Australia) and held senior operations and project
positions with BHP in Chile. He is an Adjunct Professor with the Sustainable Minerals Institute,
University of Queensland. Roger is currently a Non Executive Director of Worley Limited. He was also
recently the Chairman of both Minotaur and Demetallica Limited and a Non Executive Director of
Newcrest Mining Limited.
Roger is a member of the Nomination, Remuneration, Audit & Risk, and Treasury Committees.
Appointed 6 June 2023.
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Directors’ Report (cont.)
DIRECTORS AND OFFICERS (cont.)
Name/Qualifications
Experience and Special Responsibilities
Mr Lachlan Wallace
Chief Executive Officer and Managing Director
Qualifications
Experience
BEng (Mining Hons), MSc (Mineral & Energy Economics), MBA, MAusIMM, GAICD
Since joining Hillgrove in 2012, Lachlan held various operational roles at the Kanmantoo Copper
Mine including General Manager before becoming the Chief Executive Officer and Managing
Director in 2019. Previously, Lachlan was responsible for Stemcor’s global mining assets,
developing their iron ore and manganese portfolio in India and nickel project in Indonesia at
a time when Stemcor’s annual turnover exceeded £6Bn. In addition, Lachlan chaired a JV
between Stemcor and an Indonesian partner to facilitate thermal coal trade flows ex-Indonesia.
Lachlan has held technical, managerial and consulting roles in Africa and Australia, including
Anglo Gold Ashanti’s Siguiri gold project in Guinea, the Lumwana copper mine in Zambia, and
the Savage River iron ore mine in Tasmania.
Lachlan is a member of the Treasury Committee.
Appointed 24 May 2019.
Mr Joe Sutanto
Chief Financial Officer and Company Secretary
Qualifications
Experience
BCom, MBA, CPA
Joe joined Hillgrove in 2011 and has held a number of roles within the finance team, which
spanned commercial and planning to financial control before becoming the Company Secretary
and Chief Financial Officer in 2023. Prior to Hillgrove, Joe held a number of roles which included
as a corporate finance executive at PwC Corporate Finance, commodities trader at Glencore,
and as an auditor at KPMG. A CPA qualified accountant, Joe completed his MBA at HKUST
and London Business School.
Joe is a member of the Treasury Committee.
Appointed 16 June 2023.
Directors’ Meetings
The number of Directors’ meetings and number of meetings attended by each of the Directors of the Company during the twelve
month period are:
Meetings Held
Director
Mr D Carter
Mr M Boyte
Mr R Higgins
Mr L Wallace
Board
Remuneration
Committee
Audit & Risk
Committee
Nomination
Committee
Treasury
Committee
A
12
12
5
12
B
12
12
5
12
A
2
2
1
-
B
2
2
1
-
A
4
4
2
-
B
4
4
2
-
A
2
2
-
-
B
2
2
-
-
A
1
1
1
1
B
1
1
1
1
A – Number of meetings held during the Directors time in office
B – Number of meetings attended
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Directors’ Report (cont.)
RESULTS
Revenue from ordinary activities
Profit / (Loss) from ordinary activities after tax attributable to the owners of
Hillgrove Resources Limited
Profit / (Loss) for the period attributable to the owners of
Hillgrove Resources Limited
FY23
-
($16.3m)
($16.3m)
FY22
-
($6.0m)
($6.0m)
For the year ended 31 December 2023, the net loss after tax was $16.3 million compared to a net loss after tax of $6.0 million for
the year ended 31 December 2022.
Income Statement Overview
$ million
Copper revenue
Gold revenue
Silver revenue
Less: Treatment and refining costs
NET REVENUE FROM SALE OF CONCENTRATE
Mining costs
Processing plant costs (commissioning)
Transport and shipping costs
Care and maintenance costs
Other direct costs
Inventory movements
Royalties
Corporate costs
TOTAL COSTS
Net realised gains/(losses)
Other income
EBITDA
Depreciation and amortisation
Exploration and project costs written off
EBIT
Net interest and financing charges
Income tax benefit/(expense)
NET PROFIT / (LOSS) AFTER TAX
12 mths
Dec 2023
12 mths
Dec 2022
Change
-
-
-
-
-
(6.0)
(1.3)
-
(2.1)
(2.7)
1.0
-
(3.8)
(14.9)
0.1
0.8
(14.0)
(0.7)
(0.1)
(14.8)
(0.8)
(0.7)
(16.3)
-
-
-
-
-
-
-
-
(1.3)
(1.3)
-
-
(1.9)
(4.5)
-
0.1
(4.4)
(0.1)
-
(4.5)
(1.5)
-
(6.0)
-
-
-
-
-
-
-
-
(0.8)
(1.4)
1.0
-
(1.9)
(10.4)
0.1
0.7
(9.6)
(0.6)
(0.1)
(10.3)
0.7
(0.7)
(10.3)
There was no revenue generated during the year, with the Company’s focus being on development activities.
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The underlying EBITDA for the year resulted in a loss of $14.0 million, compared to a loss of $4.4 million in 2022. This increase
in loss was primarily driven by additional costs associated with care and maintenance of the processing plant leading up to
commissioning, other direct site expenses (including non-capital mining works), and the operational expenses of the head office.
14
Cash Flow Overview
$ million
Net cash flows from operating activities
Net cash used in investing activities
Net cash flows from financing activities
Net increase/(decrease) in cash held
Cash and cash equivalents at the end of the year
12 months Dec 2023
12 months Dec 2022
Change
(9.5)
(22.5)
36.9
4.9
10.2
(5.8)
(5.5)
5.9
(5.4)
5.3
(3.7)
(17.0)
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10.3
4.9
Directors’ Report (cont.)
RESULTS (cont.)
Operating Activities Cash Flow
Cash payments within operational activities amounted to $9.5 million, covering expenses such as corporate and administration
overheads, along with costs associated with care and maintenance activities. The increase of $3.7 million primarily stemmed
from the operational expansion post-FID, leading to a substantial increase in the workforce and engagement of suppliers to
support underground development and mining operations.
Investing Activities Cash Flow
The net cash outflow from investing activities amounted to $22.5 million, compared to an outflow of $5.5 million in the previous
corresponding period. Of the $22.5 million, $0.7 million was allocated to expenditure on exploration licenses, while the remaining
$21.8 million was invested in property, plant, and equipment.
Financing Activities Cash Flow
The company experienced a positive cash inflow of $36.9 million from financing activities. This was primarily due to $36.8 million
generated from the issuance of shares (after deducting transaction costs). Additionally, the company earned $0.8 million in
interest from bank-held cash. These gains were partially offset by $0.7 million in lease payments made during the financial year.
Consolidated Statement of Financial Position Overview
$ million
Cash
Receivables
Inventories
Property, plant & equipment
Right-of-use assets
Exploration
Total assets
Trade payables
Provisions
Lease liabilities
Employee benefits
Deferred income (government grant)
Financial liabilities (Freepoint royalty)
Total Liabilities
NET ASSETS / EQUITY
31 Dec 2023
31 Dec 2022
Change
10.2
1.5
3.2
69.1
11.8
5.3
101.1
13.7
9.6
11.8
1.6
2.0
7.5
46.2
54.9
5.3
0.9
1.9
40.0
-
4.8
52.9
0.7
9.8
-
0.6
2.0
7.2
20.3
32.6
4.9
0.6
1.2
29.1
11.8
0.5
48.1
13.0
(0.2)
11.8
1.0
-
0.3
25.9
22.2
Total assets saw a significant increase of $48.1 million, reaching $101.1 million. This increase was primarily driven by the
capital raising during the period, resulting in a cash inflow of $36.9 million. Subsequently, these funds were utilised to finance
the acquisition of property, plant, and equipment. Additionally, there were multiple right-of-use assets recognised in the current
financial year amounting to a closing balance of $11.8 million, compared to nil in the prior year.
Total liabilities rose by $25.9 million, reaching $46.2 million. This increase included the recognition of corresponding lease
liabilities, alongside the right-of-use assets, accounting for $11.8 million of the total liability growth. Additionally, there was a
$13.0 million increase in trade payables, attributed to the operational expansion post-FID, which has also resulted in additional
employee benefits payable due to the expanded workforce.
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Directors’ Report (cont.)
RESULTS (cont.)
OPERATING REVIEW
In March 2023, the Company announced a successful capital
raising to fully fund the restart of mining and processing
operations at Kanmantoo, which was subject to Shareholder
and Foreign Investment Review Board approval. Both these
approvals were received in April and June 2023 respectively.
Subsequently, the Board announced a positive final investment
decision, leading to the commencement of mine development
activities and works on the processing plant, in readiness for
the production of copper concentrates in the first quarter of
2024.
OUTLOOK AND FUTURE DEVELOPMENTS
The focus of the Company will be the safe and sustainable
production of copper concentrates from Kanmantoo. In
addition, the Company will continue to explore and evaluate
its near mine prospects, enabling it to expand its production
and mine life beyond the existing mine plan as outlined in the
Updated Economic Assessment.
MATERIAL BUSINESS RISKS
The material business risks faced by the Company that
are likely to have an effect on the financial prospects of the
Company, and how the Company manages these risks
include:
½ Insufficient cash reserves to complete development
of the Kanmantoo Underground – this risk has been
mitigated by the completion of a robust Updated Economic
Assessment in February 2023, which was compiled on a
first principles basis and based on current costs, which
reflects the cost inflationary environment the mining sector
has recently experienced. Additionally, subsequent to year
end, the Company completed the commissioning of the
processing plant and first concentrates were produced in
February 2024.
½ Price and currency volatility leading to reduced life of mine
economics – there is an ability for the Company to adjust
the cut-off grade to assist in preserving value. In addition,
a portion of the Company’s forward production sales price
has been fixed.
½ Pit wall failure leading to loss of access to the Kanmantoo
Underground – this has been mitigated through
conservative stope designs and the ongoing void
monitoring to provide real time response and prediction
to void risks. In addition, peer review for the geotechnical
work has been conducted.
CAPITAL RAISINGS
In March 2023, the Company announced an institutional
placement and a share purchase plan to raise the funds for the
restart at Kanmantoo. This was completed at 5.3 cents per
share via the following tranches:
½ Tranche 1 Placement for $15.6 million in March 2023;
½ Share Purchase Plan for $2.2 million in April 2023; and
½ Tranche 2 Placement for $20.8 million in June 2023.
All proceeds were received in 2023.
DIVIDENDS
There were no dividends paid during the current period.
SIGNIFICANT CHANGES IN THE
STATE OF AFFAIRS
Other than those matters listed in this report there have
been no significant changes in the affairs of the Group
during the period.
EVENTS SUBSEQUENT TO BALANCE DATE
The Company completed a successful capital raising on
26 February 2024, which received firm commitments for gross
proceeds of $10.0 million, split as follows:
½ Tranche 1 Placement of $8.0 million; and
½ Tranche 2 Placement of $2.0 million, which is subject to
Foreign Investment Review Board approval.
Furthermore, in January 2024, the company consolidated
certain supplier leasing agreements, leading to the
relinquishment of approximately $2.5 million in future lease
liabilities.
LIKELY DEVELOPMENTS AND EXPECTED
RESULTS OF OPERATIONS
Likely developments in the operations of the group in the short
to medium term will largely be focussed on production from
the Kanmantoo Underground and increasing the mine life
beyond that outlined in the Updated Economic Assessment.
For further details on each of these, refer to the Hillgrove
Projects section of this report.
ENVIRONMENTAL REGULATION
Closure of an operation brings with it potential significant
financial, environment, and social impacts. Recognising this, a
closure management plan for Kanmantoo has been prepared,
which includes long term monitoring to verify that controls are
effective and standards are maintained.
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Directors’ Report (cont.)
ENVIRONMENTAL REGULATION (cont.)
The consolidated entity has a policy of engaging appropriately
experienced contractors and consultants to advise on and
ensure compliance with environmental regulations in respect
of its exploration and development activities. There have been
no reports of material breaches of environmental regulations in
the financial period at the date of this report, however elevated
metals in groundwater detected in a borehole on the mining
lease was reported to the Regulator in October 2021. Whilst
this is currently immaterial, and there were no notable changes
to the levels during 2023, Hillgrove continues to monitor the
borehole to ensure that it does not lead to a material breach of
any environmental regulations.
INDEMNIFICATION AND INSURANCE OF
OFFICERS
Officers’ Indemnity
Article 102 of the Company’s Constitution provides that
“To the extent permitted by law and subject to the restrictions
in section 199A of the Corporations Act, the Company
indemnifies every person who is or has been an officer of
the Company against any liability (other than for legal costs)
incurred by that person as an officer of the Company (including
liabilities incurred by the officer as an officer of a subsidiary
of the Company where the Company requested the officer to
accept that appointment).”
Indemnity of Auditors
Hillgrove Resources Limited has agreed to indemnify their
auditors, PricewaterhouseCoopers, to the extent permitted by
law, against any claim by a third party arising from Hillgrove
Resources Limited’s breach of their agreement. The indemnity
stipulates that Hillgrove Resources Limited will meet the full
amount of any such liabilities including a reasonable amount of
legal costs.
Directors’ and Officers’ Insurance
During the financial year, the Company paid a premium
in respect of a contract for directors’ and officers’ liability
insurance. It is a condition of this Policy that each Insured and/
or any persons at their direction or on their behalf shall not
disclose the existence of any Coverage Section, its Limits of
Liability, the nature of the liability indemnified, or the premium
payable.
Proceedings on Behalf of the Company
No person has applied to the Court under section 237 of the
Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which
the Company is a party, for the purpose of taking responsibility
on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf
of the Company with leave of the Court under section 237 of
the Corporations Act 2001.
Non-Audit Services
The Company may decide to employ the auditor on
assignments additional to their statutory audit duties where the
auditor’s expertise and experience with the Company and/or
the consolidated entity are important. Details of the amounts
paid or payable to the auditor (PricewaterhouseCoopers) for
audit and non-audit services provided during the period are set
out in Note 6(e).
The Audit and Risk Committee has considered the position
and 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 did not compromise the auditor independence
requirements of the Corporations Act 2001.
None of the services provided undermine the general principles
relating to auditor independence as set out in Professional
Statement F1, including reviewing or auditing the auditor’s own
work, acting in a management or decision-making capacity for
the Company, acting as advocate for the Company or jointly
sharing economic risk and rewards. A copy of the Auditors’
Independence Declaration as required under section 307C of
the Corporations Act 2001 is set out on page 27.
Corporate Governance
The Board is committed to following ASX Corporate
Governance Council Corporate Governance Principles and
Recommendations. The Company adopts these best practice
recommendations in its policies and procedures where it is
appropriate to do so, given the size and type of Company and
its operations.
The Board has a process of reviewing all policies and
corporate governance processes. Charters are reviewed and
updated periodically. These charters provide the framework
and roles of respective committees for the appointment of
Non-Executive Directors to undertake specific responsibilities
on behalf of the Board.
Details of the corporate governance policies adopted by the
Company and referred to in this statement are available on the
Company’s website at www.hillgroveresources.com.au.
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED)
The Directors of Hillgrove Resources Limited and its Consolidated Entities present the Remuneration Report for the Company for
the year ended 31 December 2023, which forms part of the director’s report and has been audited in accordance with section
308 (3C) of the Corporations Act 2001.
1.0 Key Management Personnel
Key management personnel comprise the Non-Executive Directors, Executive Director and CFO (KMP). Details of the KMP are
set out in the table below.
Non-Executive Directors
Title (At Year End)
Change in 2023 Financial Year
Mr D Carter
Chairman
Chairman Nomination Committee
Chairman Remuneration Committee
Member Audit and Risk Committee
Mr M Boyte
Director
Chairman Audit and Risk Committee Chairman Treasury
Committee
Member Nomination Committee
Member Remuneration Committee
Mr R Higgins
Director
Member Nomination Committee
Member Remuneration Committee
Member Audit and Risk Committee
Member Treasury Committee
Executive Directors
Title (At Year End)
Mr L Wallace
CEO and Managing Director
Member Treasury Committee
Mr J Sutanto
Chief Financial Officer and Company Secretary
Full Year
Full Year
Appointed Director 6 June 2023
Change in 2023 Financial Year
Full Year
Member Treasury Committee
Appointed 16 June 2023
2.0 Role of the Board and the Remuneration Committee
The Board is responsible for the Company’s remuneration strategy and policy. Consistent with this responsibility, the Board has
established a Remuneration Committee which is chaired by an Independent Non-Executive Director.
The role of the Remuneration Committee is set out in its Charter and in summary is to:
½ Review and approve the Company’s remuneration strategy and policy;
½ Consider and propose to the Board the remuneration of the CEO and consider and approve the remuneration of all
designated senior executives;
½ Review and approve Hillgrove Resources’ short term incentive (STI) and long term incentive (LTI) schemes, including
amounts, terms and offer processes and procedures;
½ Determine and approve equity awards in accordance with policy and shareholder approvals, including testing of vesting and
termination provisions; and
½ Review and make recommendations to the Board regarding remuneration of non-executive directors.
Further information on the Remuneration Committee’s role, responsibilities and membership is contained on the Company’s
website www.hillgroveresources.com.au.
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
2.1 REMUNERATION AND BENEFITS POLICY
The Company’s approach to remuneration is outlined in the Remuneration and Benefits Policy and is based on providing
competitive rewards that motivate talented employees to deliver superior results.
The Remuneration and Benefits policy aims to:
½ Align employee remuneration to the principles and measurement of Total Shareholder Return (TSR);
½ Present progressive incentive structures to encourage outstanding performance, and hence improved TSR; and
½ Mitigate the business risks associated with poor performance, market movements and employee turnover.
The Remuneration Committee Charter and Remuneration and Benefits Policy can be viewed in the Company’s website
www.hillgroveresources.com.au.
2.2 USE OF REMUNERATION CONSULTANTS
The Remuneration Committee is briefed by management however, makes all decisions free of influence of management.
Further to the management briefings, to assist in its decision making, the Committee may, from time to time, seek independent
advice from remuneration consultants, and in so doing will directly engage with the consultant without management involvement.
In the year ending 31 December 2023, the Remuneration Committee engaged advisors Egan & Associates. Their analysis
relating to the remuneration for the Chief Executive Officer & Managing Director (CEO & MD) and the Chief Financial Officer
(CFO) was considered by the Remuneration Committee and the Board in forming their views on remuneration matters. The work
completed did not constitute a remuneration recommendation in accordance with the Corporations Act 2001.
3.0 Non-Executive Director Remuneration
Elements
Details
Aggregate Board and
Committee Fees
The total amount of fees paid to non-executive directors in the year ended 31 December 2023 is within
the aggregate amount approved by shareholders of $450,000 a year.
Board/Committee Fees
Per Annum
Board Chairman Fee
Board NED Base Fee
Remuneration Committee Chairman Fee
Audit and Risk Committee Chairman Fee
Post-Employment Benefits
Details
$120,000
$75,000
$5,000
$5,000
Superannuation
Superannuation contributions were made at a rate of 10.5% until 30 June 2023 and have been made
at a rate of 11.0% of base fee from 1 July 2023 (but only up to the Government’s prescribed maximum
contributions limit) which satisfies the Company’s statutory superannuation contributions. Contributions
are included in the total fee.
Other Benefits
Details
Equity Instruments
Non-Executive Directors may receive performance related remuneration or performance rights. In May
2021, there were two LTI Plans granted to Mr Derek Carter and Mr Murray Boyte, which at balance
date remains outstanding:
½ Tranche 1 = 8,000,000 options
½ Tranche 2 = 6,000,000 options
Further information on Tranche 1 and Tranche 2 is as follows:
Tranche 1 Options
Tranche 2 Options
Exercise Price
Grant Date
First Exercise Date
Last Exercise Date
$0.10/share
14 May 2021
14 May 2023
14 May 2025
$0.15/share
14 May 2021
14 May 2024
14 May 2026
Other Fees/Benefits
No payments were made to Non-Executive Directors during the 2023 financial year for extra services
or special exertions. Directors are entitled to be reimbursed for approved Company related expenditure
e.g. flights and expenses to attend Board meetings.
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
4.0 Executive Remuneration
4.1 EXECUTIVE KMP REMUNERATION FRAMEWORK
Hillgrove Resources’ executive remuneration strategy is designed to attract, retain and motivate a highly qualified and
experienced group of Executives.
4.2 TOTAL FIXED REMUNERATION
Total Fixed Remuneration (TFR) includes all remuneration and benefits paid to an Executive KMP calculated on a Total
Employment Cost (TEC) basis and includes base salary and superannuation benefits paid in line with the prevailing statutory
Superannuation Guarantee legislation.
4.3 REMUNERATION COMPOSITION MIX AND TIMING OF RECEIPT
The Company endeavours to provide an appropriate and competitive mix of remuneration components balanced between fixed
and ‘at risk’. The remuneration composition mix of the Company’s Executive KMP can be illustrated as follows:
Remuneration Mix CY 2023
Position
CEO & MD
CFO
TFR (Cash)
100%
100%
STI (Cash)
Up to 50% of TFR
Up to 50% of TFR
LTI (Equity)
Up to 50% of TFR
Up to 50% of TFR
Note KMPs are classified as Executives for the purposes of remuneration disclosures under the Corporations Act.
The three complementary components of Executive KMP remuneration are ‘earned’ over multiple time ranges. This is illustrated
in the following chart.
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TFR
STI
LTI 2023 OPRP
1 YEAR
4 YEARS
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
VARIABLE ‘AT RISK’ REMUNERATION
4.4
As set out in Section 4.3, variable remuneration forms a portion of the CEO & MD’s and CFO’s remuneration. Apart from being
market competitive, the purpose of variable remuneration is to direct Executive’s behaviours towards maximising Hillgrove
Resources’ value and return value to shareholders, by targeting short, medium and long term performance measures. The key
aspects are summarised below.
4.4.1 Short Term Incentives (STI)
STI Programme
Purpose
Performance Target Areas
Rewarding Performance
The STI arrangements are designed to reward executives for the achievement against annual
performance targets set by the Board at the beginning of the performance period. The STI
programme is reviewed annually by the Remuneration Committee and approved by the Board.
The key performance objectives of the Company vary by level but are currently directed to
achieving ambitious targets.
The Board adopted a Balanced Scorecard approach to determine 2023 STI performance.
The Balanced Scorecard measures performance against the Company’s internal goals, which
includes ESG metrics, resource and reserves, mine plan, and securing funding.
A threshold and target are set for each STI outcome. Specific targets are not provided in detail
due to commercial sensitivity.
Validation of performance against the Balanced Scorecard measures set for the KMPs
involves a review calculation and recommendation by the CEO & MD, reviewed and approved
by the Remuneration Committee with final Board sign-off.
4.4.2 Performance Based Remuneration Granted and Forfeited During the Year
The following table shows how much of the STI cash bonus was awarded and how much was forfeited for each KMP.
Opportunity ($)
262,500
175,000
2023 Performance
Awarded (%)
56.25% (1)
56.25% (1)
Forfeited (%)
43.75%
43.75%
KMP
Mr L Wallace
Mr J Sutanto
(1) Whilst awarded, payment has been deferred.
4.4.3 Long Term Incentives (LTI) Plans
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The LTI provides an annual opportunity for executives and key staff to receive an equity award that is intended to align a
significant portion of an executive’s overall remuneration to shareholder value over the longer term. All LTI awards remain at risk
and subject to clawback (forfeiture or lapse) until vesting and must meet or exceed share price hurdles over the vesting period,
along with other performance criteria.
As at the end of the 2023 financial year, there were three LTI Plans outstanding to Executive KMP:
½ 2021 Option and Performance Rights Plan (2021 OPRP) = 8,000,000 performance rights;
½ 2022 Option and Performance Rights Plan (2022 OPRP) = 8,000,000 performance rights; and
½ 2023 Option and Performance Rights Plan (2023 OPRP) = 8,000,000 performance rights.
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
4.4.3 Long Term Incentives (LTI) Plans (cont.)
2021, 2022, and 2023 OPRP Description
Detail
Purpose
Award
Exercise Price
Voting Rights
LTI Allocation
Service Period
Performance Hurdles
- Measurement Price
- Price Calculation Methodology
- Start of Testing Date
- First Exercise Date
- Last Exercise Date
2021 OPRP
2022 OPRP
2023 OPRP
To retain key executives and align their remuneration with shareholder value.
Under the LTI, executives and key staff are offered performance rights (to acquire ordinary
shares of Hillgrove Resources Limited).
Exercise price of nil in the event performance hurdles are met.
There are no voting rights attached to performance rights.
The size of individual LTI grants for the CEO/MD and CFO is determined in accordance
with the Board approved remuneration strategy mix. See Section 4.3.
To the later of 1 March 2024
or when the Performance
Hurdles are met
To the later of 1 March 2025
or when the Performance
Hurdles are met
To the later of 1 March 2026
or when the Performance
Hurdles are met
8.0 cents
10 day VWAP
1 March 2023
1 March 2024
10.0 cents
10 day VWAP
1 March 2024
1 March 2025
12.0 cents
10 day VWAP
1 March 2025
1 March 2026
30 March 2025
30 March 2026
30 March 2027
4.4.4 Hedging and Margin Lending Prohibition
Under the Company’s Share Trading Policy and in accordance with the Corporations Act 2001, equity granted under the
Company’s equity incentive schemes must remain at risk until vested, or exercised. It is a specific condition of the policy that no
schemes are entered into, by an individual or their associates, that specifically protects the unvested value of shares, options or
performance rights allocated.
The Company, as required under the ASX Listing Rules, has a formal policy outlining how and when employees may deal in
Hillgrove Resources securities.
Hillgrove Resources Limited’s Share Trading Policy is available on the Company’s website www.hillgroveresources.com.au.
RELATIONSHIP BETWEEN PERFORMANCE AND EXECUTIVE KMP REMUNERATION
4.5
4.5.1 Hillgrove Resources Financial Performance (31 December 2019 to 31 December 2023)
Sales Revenue ($M)
Underlying EBITDA ($M)
Reported net profit / (loss) ($M)
12 Months to 31 December
2019
113.5
12.1
(10.0)
2020
20.4
(3.7)
(5.9)
2021
-
(5.4)
(5.9)
2022
-
(4.4)
(6.0)
2023
-
(14.0)
(16.3)
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Return on equity (ROE) % (1)
(28.4%)
(24.0%)
(19.1%)
(17.0%)
(37.3%)
22
Basic earnings per share (EPS) (cents)
Diluted EPS (cents)
Dividends paid (cents per share)
Share price as at 31 December (cents)
(1.7)
(1.7)
1.5
6.0
(1.0)
(1.0)
-
3.2
(0.6)
(0.6)
-
5.4
Total shareholder return (TSR) % (Annual)
(16.7%) (2)
(46.7%)
68.8%
(0.5)
(0.5)
-
5.4
0% (3)
(1.0)
(1.0)
-
9.4
74.0%
(1) Based on average total equity.
(2) Hillgrove’s TSR performance includes the $0.015 dividend.
(3) Share price as at 31 December was 5.4c in 2021 and 2022, which results in a 0% TSR.
Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
4.6 KMP REMUNERATION TABLES – AUDITED
Non-Executive Directors
Mr D Carter
Mr M Boyte
Mr R Higgins (1)
Total (Non Executive Directors)
Executive Directors
Mr L Wallace
Mr J Sutanto (2)
Total (Executive Directors)
Total
Year
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
Short-term
Long-term
Fixed Remuneration
Salary and
Fees
Non-
monetary
Benefits
Super-
annuation
Benefits
Termination
Benefits
Long
Service
Leave
112,867
113,379
72,235
72,563
39,423
-
224,525
185,942
467,884
397,270
174,703
-
642,587
397,270
867,112
583,212
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,133
11,621
7,765
7,437
3,733
-
23,631
19,058
18,342
22,498
15,163
-
33,505
22,498
57,136
41,556
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
39,568
16,843
-
-
39,568
16,843
39,568
16,843
Total
125,000
125,000
80,000
80,000
43,156
-
248,156
205,000
525,794
436,611
189,866
-
715,660
436,611
963,816
641,611
Non-Executive Directors
Mr D Carter
Mr M Boyte
Mr R Higgins
Total (Non Executive Directors)
Executive Directors
Mr L Wallace
Mr J Sutanto
Total (Executive Directors)
Total
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
CY23
CY22
Variable Remuneration
Year
Short-Term Long-Term
Total
Total
Fixed and
Variable
125,000
125,000
80,000
80,000
43,156
-
248,156
205,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
147,656
-
53,669
-
201,325
-
201,325
-
395,762
243,099
129,587
-
525,349
243,099
525,349
243,099
543,418
1,069,212
243,099
183,256
-
679,710
373,122
-
726,674
1,442,334
243,099
679,710
726,674
1,690,490
243,099
884,710
(1) Mr R Higgins was appointed a Non Executive Director of the Company on 6 June 2023.
(2) The table shows Mr J Sutanto’s remuneration since 16 June 2023, when he was promoted to a KMP role.
Proportion of Total
Remuneration
Fixed %
Variable %
100%
100%
100%
100%
100%
-
100%
100%
49%
64%
51%
-
50%
64%
57%
73%
0%
0%
0%
0%
0%
-
0%
0%
51%
36%
49%
-
50%
36%
43%
27%
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
5.0 Equity Plan Disclosures
5.1 EMPLOYEE SHARE SCHEMES (ESS) OPERATED BY THE GROUP
Plan Details
Type of Instruments
Details
Purpose
Employee share plan and
share issues
General Employee Share
Plan (GESP)
Hillgrove Resources Option
and Performance Rights Plan
Option and Performance
Rights Plan (OPRP)
Refer 4.4.3
To incentivise and align part of employee
remuneration to shareholder value. No
employees, including KMP, were a participant in
the GESP.
To provide equity and cash incentive subject to
meeting predetermined service and performance
conditions.
5.2 ANALYSIS OF SHARE-BASED PAYMENTS GRANTED AS REMUNERATION TO KMP
Details of the vesting profile of the performance rights granted as remuneration to each Key Management Personnel, and the
movements during the period are set out below:
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a
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Balance Held
at 31/12/22
Vested
Unvested
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e
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V
KMP
Non-Executive Directors
Mr D Carter
Mr M Boyte
Mr R Higgins
May-21
May-21
-
-
-
-
7,000,000
7,000,000
-
-
-
-
-
-
14,000,000
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TOTAL
NON-EXECUTIVE
DIRECTORS
Executive Directors
Mr L Wallace
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Mr J Sutanto
TOTAL
EXECUTIVE
DIRECTORS
Jul-23
Jul-22
May-21
TOTAL
Jul-23
Jul-22
May-21
TOTAL
-
-
-
-
-
-
-
-
-
-
5,000,000
5,000,000
10,000,000
-
-
5,000,000
50%
15,000,000
5,000,000
5,000,000
33%
-
3,000,000
3,000,000
3,000,000
-
-
6,000,000
3,000,000
-
-
-
-
0%
0%
0%
0%
21,000,000
8,000,000
5,000,000
24%
d
e
t
s
e
V
%
0%
0%
-
0%
0%
0%
-
-
-
-
-
-
r
e
b
m
u
N
d
e
t
i
e
f
r
o
F
-
-
-
-
-
-
-
-
-
-
-
-
-
d
e
t
i
e
f
r
o
F
%
0%
0%
-
0%
0%
0%
0%
Balance held
at 31/12/23
Vested
Unvested
-
-
-
7,000,000
7,000,000
-
- 14,000,000
-
-
5,000,000
5,000,000
5,000,000
5,000,000
0% 5,000,000
15,000,000
0%
0%
0%
0%
-
-
-
-
3,000,000
3,000,000
3,000,000
9,000,000
0% 5,000,000
24,000,000
24
5.3 EXERCISE OF PERFORMANCE RIGHTS GRANTED AS REMUNERATION TO KMP
5,000,000 performance rights which vested and were available to be exercised in 2023 were exercised.
Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
5.4 VALUE OF PERFORMANCE RIGHTS GRANTED AND ON FOOT TO EXECUTIVE KMP as at 31 December 2023
KMP
Non-Executive Directors
Mr D Carter
2021 Options Tranche 1
2021 Options Tranche 2
Mr M Boyte
2021 Options Tranche 1
2021 Options Tranche 2
TOTAL NON-EXECUTIVE DIRECTORS
Executive Directors
Mr L Wallace
2021 OPRP
2022 OPRP
2023 OPRP
Mr J Sutanto
2021 OPRP
2022 OPRP
2023 OPRP
TOTAL EXECUTIVE DIRECTORS
Outstanding
Face Value
per right (1)
Fair Value
per right (2)
Intrinsic
Value (3)
Fair Value
4,000,000
3,000,000
4,000,000
3,000,000
14,000,000
5,000,000
5,000,000
5,000,000
3,000,000
3,000,000
3,000,000
24,000,000
0.094
0.094
0.094
0.094
0.094
0.094
0.094
0.094
0.094
0.094
0.0384
0.0355
0.0384
0.0355
$0.074
$0.069
$0.039
$0.074
$0.069
$0.039
$376,000
$282,000
$153,440
$106,353
$376,000
$282,000
$1,361,000
$153,440
$106,353
$519,586
$470,000
$470,000
$470,000
$282,000
$282,000
$282,000
$368,500
$347,000
$195,000
$221,100
$208,200
$117,000
$2,256,000
$1,456,800
(1) The Face Value is the closing share price on 31 December 2023.
(2) The Fair Value has been based on a valuation in accordance with accounting standard AASB 2 “Share Based Payments”.
The fair values are used for accounting purposes only.
(3)
Intrinsic value is the difference between the Face Value ($0.094) and the exercise price ($0.00).
5.5 MOVEMENT IN EQUITY HELD
The movement during the reporting period in the number of ordinary shares of Hillgrove Resources Limited held, directly,
indirectly or beneficially, by each specified Director and executive KMP, including their personally-related entities:
Directors
Mr D Carter
Mr M Boyte
Mr R Higgins
Mr L Wallace
Mr J Sutanto
Held as at 31/12/22
Exercise of Rights
Net Other Changes
Held as at 31/12/23
Shares
Shares
Shares
Shares
Shares
1,805,210
3,482,216
- (1)
16,396,259
5,570,765 (2)
-
-
-
5,000,000
-
566,037
566,037
-
566,037
-
2,371,247
4,048,253
-
21,962,296
5,570,765
(1) As at 6 June 2023, the date Mr R Higgins was appointed a Non Executive Director of the Company.
(2) As at 16 June 2023, the date Mr J Sutanto was appointed as CFO of the Company.
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Directors’ Report (cont.)
REMUNERATION REPORT (AUDITED) (cont.)
6.0 Service Contracts and Employment Agreements
The Company does not enter into service contracts for KMP Executives. The following sets out details of the employment
contract for the Executive KMP as at 31 December 2023.
Employee
Position
Commencement
Fixed Remuneration
Short-term Incentive
Long-term Incentive
Contract Length
Notice Periods for Resignation or Termination
Redundancy Benefit
Death or Total and Permanent Disability
Benefit
Change of Control
Termination for Serious Misconduct
Statutory Entitlements
Post-Employment Restraints
Mr L Wallace
Mr J Sutanto
Chief Executive Officer and
Managing Director
Chief Financial Officer and
Company Secretary
24 May 2019
$525,000 per annum
reviewed periodically
16 June 2023
$350,000 per annum
reviewed periodically
Up to 50% of fixed remuneration
Up to 50% of fixed remuneration
Up to 50% of fixed remuneration
Up to 50% of fixed remuneration
Indefinite
6 months
Indefinite
3 months
National Employment Standards and
Group Redundancy Policy
National Employment Standards and
Group Redundancy Policy
No specific benefit
No effect
No specific benefit
No effect
No notice required, remuneration to
the day less advance payments and
return of Company property.
No notice required, remuneration to
the day less advance payments and
return of Company property.
No payment of STI/LTI
No payment of STI/LTI
All leave and benefits due per National
Employment Standards
All leave and benefits due per National
Employment Standards
For 6 months: must not recruit
employees or make adverse
comments or actions by either party
For 6 months: must not recruit
employees or make adverse
comments or actions by either party
CORPORATE GOVERNANCE STATEMENT
The Company’s Board is committed to achieving the highest standards of corporate governance.
The Company’s Corporate Governance Statement for the year ended 31 December 2023 may be accessed from the Company’s
website at www.hillgroveresources.com.au/Corporate-Governance.
ROUNDING OF AMOUNTS
The Company is of a kind referred to in ASIC Corporations (Rounding in Financials/Directors’ Reports) Instrument 2016/191,
dated 24 March 2016, and in accordance with that Corporations Instrument amounts in the directors‘ report and the financial
statements are rounded off to the nearest hundred thousand dollars, unless otherwise indicated.
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AUDITORS INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out
on page 27.
26
Signed in accordance with a resolution of the Directors:
Dated at Adelaide this 26th day of February 2024.
Derek Carter
Chairman
Lachlan Wallace
Managing Director
Auditor’s Independence Declaration
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PricewaterhouseCoopers, ABN 52 780 433 757 Level 11, 70 Franklin Street, ADELAIDE SA 5000, GPO Box 418, ADELAIDE SA 5001 T: +61 8 8218 7000, F: +61 8 8218 7999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation. Auditor’s Independence Declaration As lead auditor for the audit of Hillgrove Resources Limited for the year ended 31 December 2023, I declare that to the best of my knowledge and belief, there have been: (a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and (b) no contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Hillgrove Resources Limited and the entities it controlled during the period. Julian McCarthy Adelaide Partner PricewaterhouseCoopers 26 February 2024
Consolidated Statement of
Profit or Loss and Other Comprehensive Income
For the year ended 31 December 2023
31 Dec 2023
31 Dec 2022
Note
5
6(a)
6(b)
6(c)
7
Other income
Expenses
Interest and finance charges
Impairment charges
(Loss) before income tax
Income tax (expense) / benefit
(Loss) for the year attributable to owners
Comprehensive income
Items that may be reclassified to profit or loss:
Total comprehensive income for the period attributable to
equity holders of Hillgrove Resources Limited
$’000
779
(15,387)
(941)
(103)
(15,652)
(675)
(16,327)
-
(16,327)
Earnings per share for profit attributable to the ordinary
equity holders of the Company:
Basic earnings per share (cents)
Diluted earnings per share (cents)
9
9
(1.0)
(1.0)
$’000
67
(4,538)
(1,465)
(24)
(5,960)
(13)
(5,973)
-
(5,973)
(0.5)
(0.5)
The Consolidated Statement of Profit and Loss and Other Comprehensive Income is to be read in conjunction with
the Notes to the consolidated financial statements set out on pages 32 to 53.
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Consolidated Statement of Financial Position
As at 31 December 2023
31 Dec 2023
31 Dec 2022
Note
$’000
$’000
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Non-current assets
Property, plant and equipment
Right-of-use assets
Exploration and evaluation expenditure
Inventories
Total assets
Current liabilities
Trade and other payables
Provisions
Lease liabilities
Employee benefits payable
Other financial liabilities
Non-current liabilities
Provisions
Lease liabilities
Deferred income
Other financial liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
10
11
12
13
17
14
12
15
16
17
18
21
19
17
20
21
22
23
24
10,240
1,461
3,137
14,838
69,089
11,800
5,328
-
86,217
101,055
13,694
1,090
4,311
1,594
2,997
23,686
8,500
7,506
2,000
4,487
22,493
46,179
54,876
292,947
31,166
(269,237)
54,876
5,305
905
410
6,620
40,031
-
4,784
1,464
46,279
52,899
703
766
-
663
-
2,132
9,006
-
2,000
7,195
18,201
20,333
32,566
256,088
29,388
(252,910)
32,566
The Consolidated Statement of Financial Position is to be read in conjunction with
the Notes to the financial statements set out on pages 32 to 53.
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Consolidated Statement of Changes in Equity
For the year ended 31 December 2023
Contributed
equity
Note
$’000
Reserves
$’000
Accumulated
losses
Total equity
$’000
$’000
Balance 1 January 2022
256,118
28,762
(246,937)
Profit/(Loss) for the period
Transactions with owners:
Contributions of equity, net of transaction
costs and tax
Share-based payments
Balance 31 December 2022
Profit/(Loss) for the period
Transactions with owners:
Contributions of equity, net of transaction
costs and tax
Share-based payments
Balance 31 December 2023
-
(30)
-
256,088
-
36,859
-
292,947
22
33
22
33
-
-
626
29,388
-
-
1,778
31,166
37,943
(5,973)
(30)
626
(5,973)
-
-
(252,910)
32,566
(16,327)
(16,327)
-
-
(269,237)
36,859
1,778
54,876
The Consolidated Statement of Changes in Equity is to be read in conjunction with
the Notes to the consolidated financial statements set out on pages 32 to 53.
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Consolidated Statement of Cash Flows
For the year ended 31 December 2023
31 Dec 2023
31 Dec 2022
Note
$’000
$’000
Cash flows from operating activities
Cash receipts in the course of operations (inclusive of GST)
Cash payments in the course of operations (inclusive of GST)
Net cash used by operating activities
28
Cash flows from investing activities
Payments for exploration and evaluation expenditure
Grant income relating to exploration and evaluation
Payments for property, plant and equipment
Grant income relating to property, plant and equipment
Proceeds on disposal of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares (net of transaction costs)
Proceeds from borrowings
Lease payments
Interest received
Net cash from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of financial period
Cash and cash equivalents at the end of the financial period
10
17
(9,556)
(9,539)
(689)
-
(21,824)
-
55
(22,458)
36,834
-
(664)
762
36,932
4,935
5,305
10,240
The Consolidated Statement of Cash Flows is to be read in conjunction with
the Notes to the consolidated financial statements set out on pages 32 to 53.
25
(5,777)
(5,752)
(605)
304
(7,269)
2,000
-
(5,570)
(23)
5,868
-
45
5,890
(5,432)
10,737
5,305
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023
1. STATEMENT OF MATERIAL
ACCOUNTING POLICIES
(c) Foreign currency translation
(i)
Functional and presentation currency
The principal accounting policies adopted in the preparation
of these consolidated financial statements are set out
below. Where an accounting policy is specific to one Note,
the policy is described in the Note to which it relates. The
financial statements are for the consolidated entity consisting
of Hillgrove Resources Limited and its subsidiaries.
(a) Going concern
The consolidated financial statements have been prepared
on a going concern basis, which assumes the Group will be
able to realise its assets and discharge its liabilities in
the normal course of business. Based on the successful
capital raising as outlined in Note 31, and the projected
cashflows from the processing of copper inventory, the
Directors consider that the cash inflows of the Group will be
sufficient to cover forecast expenditure for at least the next
twelve months.
(b) Basis of preparation
This general purpose financial report has been prepared
in accordance with Australian Accounting Standards,
Interpretations and other authoritative pronouncements
of the Australian Accounting Standards Board and the
Corporations Act 2001. The financial statements comprise
the consolidated financial statements of the Group. For the
purposes of preparing the consolidated financial statements,
Hillgrove Resources Limited is a for-profit entity.
(i)
Compliance with International Financial
Reporting Standards
Compliance with Australian Accounting Standards ensures
that the consolidated financial statements and notes of
Hillgrove Resources Limited comply with International
Financial Reporting Standards (IFRSs).
(ii) Historical cost convention
These financial statements have been prepared under the
historical cost convention, as modified when necessary by
the revaluation of certain financial assets and liabilities to fair
value through other comprehensive income or through profit
or loss.
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(iii) Critical accounting estimates
The preparation of financial statements requires the use
of certain critical 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 material to the financial
statements are disclosed in Note 2.
Items included in the financial statements of each of the
Group’s entities are measured using the currency of the
primary economic environment in which the entity operates
(‘the functional currency’). The consolidated financial
statements are presented in Australian dollars, which is
Hillgrove Resources Limited’s functional and presentation
currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the
functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions and
from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are
recognised in the profit or loss, except when deferred in
equity as qualifying cash flow hedges and qualifying net
investment hedges.
For the purpose of presenting consolidated financial
statements, the assets and liabilities of Hillgrove Resources
Limited’s foreign operations are translated into Australian
dollars using exchange rates prevailing at the end of the
reporting period. Income and expense items are translated at
the average exchange rates for the period, unless exchange
rates fluctuated significantly during that period, in which case
the exchange rates at the dates of the transactions are used.
Exchange rate differences arising, if any, are recognised in
other comprehensive income and accumulated in equity
(attributed to non-controlling interests as appropriate).
(d) Impairment of assets
The carrying value of property, plant and equipment is
assessed for impairment whenever there is an indicator that
the asset may be impaired. Determining whether property,
plant and equipment is impaired requires an estimation of
the recoverable value of the Cash Generating Unit (“CGU”)
to which property, plant and equipment has been allocated.
Impairment is recognised when the carrying amount exceeds
the recoverable amount.
The recoverable amount is the higher of an assets fair value
less costs to sell and its value-in-use (VIU). In its impairment
assessment, the Group determined the recoverable amount
based on VIU. The assessment was undertaken using a
discounted cash flow approach. Cash flow projections are
based on the CGU’s life of mine plan. In assessing the VIU,
the estimated future post-tax cash flows are discounted to
their present value using a post-tax discount rate that reflects
the current market assessment of the time value of money
and business risk.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
1. STATEMENT OF MATERIAL
ACCOUNTING POLICIES (cont.)
(d) Impairment of assets (cont.)
The valuation is considered to be level 3 in the fair value
hierarchy due to unobservable inputs used in the valuation.
Assets that have undergone an impairment charge are
reviewed for possible reversal of the impairment at each
reporting date.
The specific methods and assumptions used to estimate the
discounted future cash flows of the Group’s CGU are outlined
in more detail in Note 2 “Critical accounting estimates and
judgements”.
(e) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case it is
recognised as part of the cost of acquisition of the asset or
as part of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the taxation authority
is included with other receivables or payables in the
consolidated statement of financial position.
The effective interest method is the method of calculating
the amortised cost of a financial liability and for the allocation
and recognition of the associated interest expense in the
relevant period. The effective interest rate is the rate that
exactly discounts the estimated future cashflows of the
financial liability to its initial fair value.
(h) Rounding of amounts
The Company is a company of the kind referred to in ASIC
Corporations (Rounding in Financials/Directors’ Reports
Instrument 2016/191, dated 24 March 2016, and in
accordance with that Corporations Instrument, amounts
in the directors’ report and the financial statements are
rounded off to the nearest thousand dollars, unless
otherwise indicated).
(i) Standards and interpretations in issue
(i) Mandatory standards adopted in the
current reporting period
The Group has adopted all of the new and revised
Standards and Interpretations issued by the Australian
Accounting Standards Board that are relevant to its
operations and effective for the current annual reporting
period. The adoption of these mandatory standards has not
had a material impact on the Group’s accounting policies or
the amounts reported during the year.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing or financing
activities which are recoverable from, or payable to the
taxation authority, are presented as operating cash flows.
(ii) Early adoption of standards
There are no standards on issue that are expected to have
a material impact on the group in the current or future
reporting periods.
(f) Government grants
Government grants are recognised where there is reasonable
assurance that the grant will be received, and all attached
conditions will be complied with. The recognition treatment of
the grant depends on the purpose of the grant as follows:
i.
ii.
iii.
Relating to an expense item - recognised as a
reduction of the expense to which it relates.
Relating to property, plant and equipment – recognised
as deferred income within the Consolidated Statement
of Financial Position and released to the Consolidated
Statement of Profit and Loss and Other Comprehensive
Income over the life of the associated asset.
Relating to exploration activities – recognised as
a reduction in the carrying value of the associated
exploration asset.
(g) Financial liabilities
Financial liabilities are initially measured at fair value, net
of transaction costs, and are subsequently measured at
amortised cost using the effective interest method.
(j) AASB 16 – Leases
Prior to the current period, the Group did not have any
material lease obligations that required disclosure under
AASB 16. The approval of the underground project has
resulted in various contracts being entered into that require
the introduction of “right-of-use assets” and “lease liabilities”
disclosures in the current period, refer to Note 17.
Lease Identification:
In identifying whether a contract contains a lease
component, The Group considers whether:
½ The contract explicitly or implicitly conveys the right to
control the use of an identified asset;
33
½ The Group has the right to substantially all of the
economic benefits from the use of the identified asset;
and
½ The Group has the right to direct the use of the identified
asset.
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
1. STATEMENT OF MATERIAL
2. CRITICAL ACCOUNTING ESTIMATES
ACCOUNTING POLICIES (cont.)
AND JUDGEMENTS
(j) AASB 16 – Leases (cont.)
Measurement of Lease Liabilities and
Right-of-Use Assets:
As a lessee, the Group recognises a right-of-use asset and a
lease liability at the lease commencement date. The right-of-
use asset is initially measured at cost (present value of the
lease liability), and subsequently at cost less any accumulated
depreciation, impairment losses and adjustments for
remeasurement of the lease liability. Right-of-use assets are
depreciated over the shorter of the asset’s useful life or the
lease term on a straight-line basis. However, if the Group is
reasonably certain to exercise a purchase option, the right-of-
use asset is depreciated over the underlying asset’s useful life.
Lease liabilities are initially recognised at the net present
value of the lease payments expected to be paid over the
lease term. The lease payments are discounted using the
interest rate implicit in the lease. If that rate cannot be readily
determined, the Group’s incremental borrowing rate is used,
being the rate that the Group would have to pay to borrow
the funds necessary to obtain an asset of similar value to the
right-of-use asset in a similar economic environment with
similar terms, security, and conditions. Lease payments are
allocated between principal and finance charge. The finance
charge is expensed to profit or loss over the lease period to
produce a constant periodic rate of interest on the remaining
balance of the liability for each period.
Subsequent to initial measurement, the lease liability will be
reduced for payments made and increased for interest. It is
remeasured to reflect any reassessment or modification, or if
there are changes in in-substance fixed payments. When the
lease liability is remeasured, the corresponding adjustment is
reflected against the right-of-use asset, or profit or loss if the
right-of-use asset is already reduced to zero.
Short-term Leases and Low-Value Leases:
The Group applies the short-term lease recognition
exemption to its short-term leases. These are leases with a
lease term of 12 months or less without a purchase option.
The Group also applies the low-value (<$5,000 USD) asset
recognition exemption to leases such as IT and office
equipment. Payments associated with short-term and low
value leases are recognised on a straight-line basis as an
expense in profit or loss.
Variable lease payments:
Some leases accounted for under AASB 16 contain variable
payment terms that are linked to usage hours incurred and
are payable in addition to the fixed payments. These variable
lease payments are recognised in profit or loss in the period
in which the condition that triggers those payments occurs.
The Group makes estimates and assumptions concerning
the future. The resulting accounting estimates will, by
definition, seldom equal the related actual results. Estimates
and judgements are continually evaluated and are based
on historical experience and other factors, including
expectations of future events that are believed to be
reasonable under the circumstances. The estimates and
assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
are discussed below:
(a) Recoverability of non-current assets
The Group has a single Cash Generating Unit (CGU) being
the Kanmantoo copper mine. The recoverable amount is
based on value in use calculations which require the use
of assumptions. The estimates of discounted future cash
flows for the Kanmantoo CGU are based on significant
assumptions including:
½ Estimates of the quantities of resources, and the timing
of access to those resources;
½ Future production levels based on plant throughput and
recoveries;
½ Future copper, gold and silver prices based on spot
pricing;
½ Future exchange rates for the Australian dollar to US
dollar based on spot prices;
½ Future operating costs of production, capital expenditure
and rehabilitation expenditure;
½ The discount rate most appropriate to the CGU; and
½ The timing and amounts to be received from the sale of
processing equipment and land following completion of
mining and processing activities.
(b) Exploration and evaluation expenditure
The application of the Group’s accounting policy for
exploration and evaluation expenditure requires judgement
in determining whether future economic benefits are likely,
either from development and commercial exploitation, or sale
of the respective areas. Estimates and assumptions made
may change if new information becomes available.
(c) Restoration, rehabilitation and
environmental obligations
Provision is made for the costs of decommissioning and
site rehabilitation costs when the related environmental
disturbance takes place. Provisions are recognised at the
net present value of future expected costs as outlined in
Notes 16 and 19.
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
2. CRITICAL ACCOUNTING ESTIMATES
(e) Lease Liabilities
Certain contractual arrangements not in the form of a
lease require the Group to apply significant judgement in
evaluating whether the Group controls the right to direct the
use of assets and therefore whether the contract contains a
lease. Management considers all facts and circumstances
in determining whether the Group or the supplier has the
rights to direct how, and for what purpose, the underlying
assets are used in certain mining contracts. Judgement is
used to assess which decision-making rights mostly affect
the benefits of use of the assets for each arrangement.
Where a contract includes the provision of non-lease
services, judgement is required to identify the lease and
non-lease components.
Where the Group cannot readily determine the interest
rate implicit in the lease, estimation is involved in the
determination of the incremental borrowing rate to measure
lease liabilities.
The incremental borrowing rate reflects the rates of
interest a lessee would have to pay to borrow over a
similar term, with similar security, the funds necessary to
obtain an asset of similar value to the right-of-use asset
in a similar economic environment. Under the Group’s
portfolio approach to debt management, the Group does
not specifically borrow for asset purchases. Therefore, the
incremental borrowing rate is estimated referencing the
latest data available to management based on relevant
contracts that offer interest applied credit facilities.
3. DIVIDENDS
Franked dividends paid
Amount of franking credits
available to shareholders for
subsequent financial years
31 Dec 2023
31 Dec 2022
$’000
-
$’000
-
17,556
17,556
4. FINANCIAL REPORTING BY SEGMENT
Through its ownership of the Kanmantoo copper mine, the
Group has one operating segment in the resources industry,
in Australia.
I
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O
V
E
R
E
S
O
U
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S
L
M
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D
I
I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
35
AND JUDGEMENTS (cont.)
(c) Restoration, rehabilitation and
environmental obligations (cont.)
The provision represents management’s best estimate of
the costs that will be incurred, but significant judgement is
required on cost estimates including inflation and discount
rates and changes to the lives of operations, as many of these
costs will not crystallise until the end of the life of the mine.
(d) Fair value of financial liabilities
During August 2022, the Group entered into a royalty funding
agreement with Freepoint Metals and Concentrates LLC
(Freepoint). $5.9 million was received from Freepoint ($6.0
million less transaction costs), and in return, the group will
pay Freepoint 2.5% of net smelter returns for the first 85,000
tonnes of payable copper from the Kanmantoo underground
project, reducing to 0.5% thereafter.
As FID for the underground project occurred during the period
the potential payments to Freepoint have been classified as a
financial liability, measured at amortised cost.
Financial liabilities at amortised cost are initially recognised at
fair value less transaction costs and are thereafter carried at
amortised cost using the effective interest method. The fair
value was assessed at 31 December 2023 to be $7.5 million
(31 December 2022: $5.9 million). The effective interest rate is
the rate that discounts estimated future cashflows to the initial
fair value and this was calculated to be 24.06%, which does
not change throughout the life of the liability.
At each reporting period an interest expense will be
recognised in the profit and loss representing the unwinding of
the discount reflected in the amortised cost carrying value. In
addition, recalculations may be required at reporting periods
for any known changes i.e., updated copper pricing, ore
reserves etc. When changes are not the result of movements
in the market rates of interest, the cashflows are updated but
continue to be discounted using the original effective interest
rate. Any gain or loss on this recalculation is recognised in
the Consolidated Statement of Profit and Loss and Other
Comprehensive Income.
At 31 December 2023, an interest expense of $1.7 million
was recognised for the unwinding of the discount. In
addition, a recalculation was performed to revalue the liability
based on the latest life of mine plan which includes forecasts
for copper prices, resulting in an expense of $1.4 million as at
31 December 2023.
Refer to Note 25(a) for analysis of the estimated impact
of movements in the copper price on the financial
liability valuation.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
5. OTHER INCOME
Interest and finance charges
(b)
Interest
Other – excess rehabilitation
seed sale income
Total other income
31 Dec 2023
31 Dec 2022
$’000
763
16
779
$’000
44
23
67
6. EXPENSES
Profit or loss before income tax includes the following
expenses:
(a) Expenses per profit or loss
31 Dec 2023
31 Dec 2022
Discount on unwind of royalty
financial liability
Discount on unwind of
rehabilitation provision
Interest on leases
Borrowing costs, bank fees
and charges
Interest on financial liabilities
Revaluation of royalty financial
liability
Total interest and finance
charges
31 Dec 2023
31 Dec 2022
$’000
$’000
1,692
360
278
8
6
438
130
-
8
-
(1,403)
889
941
1,465
Note
(i)
(ii)
(iii)
(iv)
(v)
Costs of production
Depreciation and
amortisation
Inventory movement
Cost of goods sold
Corporate and other
costs
Care and maintenance
costs and other direct
site costs
Processing plant
commissioning
Depreciation and
amortisation
Rehabilitation
adjustment
Gain on sale of fixed
assets
Foreign exchange gain
Total expenses
$’000
5,964
-
(974)
4,990
$’000
(c)
Impairment charges
-
Exploration assets
Note
(i)
31 Dec 2023
31 Dec 2022
$’000
103
103
$’000
24
24
3,741
1,863
4,940
2,640
(i) Expenditure on exploration areas of interest where the
prospect of recoupment of costs capitalised through
successful development and commercial exploitation is no
longer considered likely, is charged to the profit or loss as an
impairment charge.
(d) Other required disclosures
Employee benefits (excluding
share-based payments)
Employee share based
payments (see Note 33)
31 Dec 2023
31 Dec 2022
$’000
$’000
8,916
1,036
3,121
626
1,310
746
(115)
(50)
(175)
15,387
67
(32)
-
-
4,538
(i) Costs of production currently represent costs for underground
mining activities.
(ii) Reflects costs mainly associated with running the corporate
head office, board of directors, and employee share option
expenses.
(iii) Costs incurred for care and maintenance of the plant and
equipment prior to initial production.
(iv)
Includes depreciation related to P&E and ROU assets, offset by
a portion of depreciation capitalised as part of the underground
mining activities.
(v) The decrease in the required rehabilitation provision has been
credited to the profit or loss as the associated rehabilitation
asset in Mine Development has been written down to nil in
prior reporting periods.
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
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S
E
C
R
U
O
S
E
R
E
V
O
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36
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
6. EXPENSES (cont.)
(e) Assurance services
INCOME TAX
31 Dec 2023
31 Dec 2022
7.
The following fees were paid or payable for services provided
by the auditor of the parent entity, its related practices and
non-related audit firms:
31 Dec 2023
31 Dec 2022
$
$
(i) Audit Services
PricewaterhouseCoopers:
Audit and review of
financial reports and other
audit work under the
Corporations Act 2001
(ii) Taxation Services
Services by
PricewaterhouseCoopers:
Tax advice and tax
compliance
202,100
202,100
112,691
112,691
48,270
48,270
27,360
27,360
(a) Income tax expense
Income tax expense
comprises:
- Current tax expense
- Deferred tax expense /
(benefit)
Income tax expense / (benefit)
(b) Numerical
reconciliation of income
tax expense to prima facie
tax payable
Profit/(loss) from continuing
operations before income tax
expense/(benefit)
Tax at the Australian tax rate
of 30%
Tax effect of amounts
which are not deductible in
calculating taxable income:
- Share based payments
- Non-deductible expenses
- Non-assessable income
- Tax temporary differences
(recognised)/not recognised
Income tax expense/(benefit)
(c) Amounts recognised
directly in equity
Deferred tax – (credited) /
debited directly in equity
$’000
$’000
-
675
675
-
13
13
(15,651)
(5,960)
(4,695)
(1,788)
311
5
-
5,054
675
188
1
-
1,612
13
675
13
I
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E
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S
O
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S
L
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E
D
I
I
(d)
Tax consolidation legislation
The income tax expense or revenue for the period is the tax
payable on the current period’s taxable income based on
the national income tax rate for each jurisdiction adjusted
by changes in deferred tax assets and liabilities attributable
to temporary differences between the tax bases of assets
and liabilities and their carrying amounts in the financial
statements, and to unused tax losses. The Group’s liability
for current tax is calculated using tax rates that have been
enacted or substantively enacted by the end of the reporting
period. Current and deferred tax balances attributable to
amounts recognised directly in equity are also recognised
directly in equity.
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
37
$’000
31 Dec 2023
31 Dec 2022
Tax losses and credits
Business related costs
INCOME TAX (cont.)
The balance of deferred tax assets comprises temporary
differences attributable to:
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
7.
Hillgrove Resources Limited and its wholly-owned Australian
controlled entities have implemented the tax consolidation
legislation. The head entity, Hillgrove Resources Limited,
and the controlled entities in the tax consolidated group
account for their own current and deferred tax amounts.
These tax amounts are measured as if each entity in the tax
consolidated group continues to be a stand-alone taxpayer
in its own right. The entities in the tax-consolidated group
entered into a tax sharing agreement and a tax funding
agreement. On adoption of the legislation, the entities in the
tax consolidated group entered into a tax sharing agreement
which, in the opinion of the Directors, limits the joint and
several liability of the wholly owned entities in the case of
a default by the head entity. The entities have also entered
a tax funding agreement under which the wholly-owned
entities fully compensate the head entity for any current
tax payable assumed and are compensated by the head
entity for any current tax receivable and deferred tax assets
relating to unused tax losses or unused tax credits that are
transferred to it under the tax consolidation legislation.
The balance of deferred tax liabilities comprises temporary
differences attributable:
Exploration expenditure / PPE
Total deferred tax liabilities
Total deferred tax assets
Provisions and accruals
Deferred income
Financial liability
Lease liability
31 Dec 2022
31 Dec 2023
70,515
76,232
77,772
86,013
3,183
2,158
9,346
9,346
3,379
3,545
$’000
$’000
$’000
376
717
600
154
154
-
-
-
8.
(i)
(ii)
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
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S
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C
R
U
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S
E
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DEFERRED TAX
No deferred tax assets or liabilities have been
recognised.
Deferred tax assets and liabilities are recognised for
temporary differences at the tax rates expected to
apply when the assets are recovered or liabilities are
settled, based on those tax rates which are enacted or
substantively enacted for each jurisdiction. The relevant
tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to
measure the deferred tax asset or liability.
An exception is made for certain temporary differences
arising from the initial recognition of an asset or a
liability. No deferred tax asset or liability is recognised
in relation to these temporary differences if they arose
in a transaction, other than a business combination,
that at the time of the transaction did not affect either
accounting profit or taxable profit or loss.
38
Deferred tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate
to the same taxation authority.
(iii) Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it
is probable future taxable amounts will be available to
utilise those temporary differences and losses.
Net deferred tax assets
Deferred tax assets not
recognised
Recognised net deferred tax
assets
85,859
66,886
(85,859)
(66,886)
-
-
The company has unrecognised capital losses of
$11.3 million (2022: $11.3 million).
9. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit
attributable to equity holders of the Company, excluding any
costs of servicing equity other than ordinary shares, by the
weighted average number of ordinary shares outstanding
during the year, adjusted for bonus elements in ordinary
shares issued during the year.
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into
account the after income tax effect of interest and other
financing costs associated with dilutive potential ordinary
shares and the weighted average number of shares
assumed to have been issued for no consideration in relation
to dilutive potential ordinary shares. Potential ordinary
shares shall be treated as dilutive when, and only when, their
conversion to ordinary shares would decrease earnings per
share or increase loss per share from continuing operations.
Classification of securities as ordinary shares
Ordinary shares have been classified as ordinary shares and
included in basic earnings per share.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
9. EARNINGS PER SHARE (cont.)
Classification of securities as potential shares
10. CASH AND CASH EQUIVALENTS
31 Dec 2023
31 Dec 2022
Outstanding performance rights have been classified as
potential ordinary shares and included in diluted earnings
per share.
Cash at bank and on hand
Restricted cash
$’000
9,924
316
10,240
$’000
4,758
547
5,305
(a) Weighted average number of shares
used as the denominator
31 Dec 2023
31 Dec 2022
Number
Number
Weighted average number of
ordinary shares used
in calculating basic and
dilutive EPS
Cash and cash equivalents include cash on hand, deposits
held at call with financial institutions, other short-term and
highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant
risk of changes in value.
1,685,663,053 1,173,953,754
Restricted cash cannot be accessed without consent and
comprises two bank guarantees.
(b) Reconciliation of earnings used in
calculating earnings per share
11. TRADE AND OTHER RECEIVABLES
(i) Basic earnings
(Loss) from continuing
operations attributable to the
ordinary equity holders of the
Company:
(ii) Diluted earnings
(Loss) from continuing
operations attributable to the
ordinary equity holders of the
Company:
(i) Basic earnings
per share
(Loss) from continuing
operations attributable to the
ordinary equity holders of the
Company:
(ii) Diluted earnings
per share
(Loss) from continuing
operations attributable to the
ordinary equity holders of the
Company:
31 Dec 2023
31 Dec 2022
$’000
$’000
(16,327)
(5,973)
Prepayments
Other receivables
GST receivable
12. INVENTORIES
(16,327)
(5,973)
Current assets
31 Dec 2023
31 Dec 2022
Stores and consumables
Cents
Cents
ROM stockpile
Total current inventory
Non-current assets
Stores and consumables
Total non-current inventory
(1.0)
(0.5)
31 Dec 2023
31 Dec 2022
$’000
377
515
569
1,461
$’000
481
362
62
905
31 Dec 2023
31 Dec 2022
$’000
$’000
2,163
974
3,137
-
-
410
-
410
1,464
1,464
All inventory is recognised at the lower of cost and net
realisable value.
I
H
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O
V
E
R
E
S
O
U
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C
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S
L
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E
D
I
I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
(1.0)
(0.5)
The cost of ROM inventory is determined using the allocation
of costs between production and development activities.
Costs and activities are monitored at each stage of the
production process and allocated to physical units.
39
Net realisable value is based on the estimated amount
expected to be received when the inventory is completely
processed and sold. The estimation of net realisable value of
inventories involves judgements about the quantity of metal
that can be recovered, future commodity prices, production
costs and selling costs.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
13. PROPERTY, PLANT AND EQUIPMENT
The straight line method of depreciation to allocate cost,
net of residual values, is used for all remaining assets over
estimated useful lives as follows:
½ Mine Development
3 – 10 years
½ Motor Vehicles
3 years
½ Plant & Equipment
3 – 10 years
The duration reflects the specific nature of the assets.
Freehold land is not depreciated. The assets’ residual values
and useful lives are reviewed, and adjusted if appropriate,
at each reporting date. During the period of care and
maintenance, depreciation of the processing plant ceased.
Mine development includes development costs incurred
related to the Kanmantoo mine.
When proven mineral reserves are determined and
development is approved, capitalised exploration and
evaluation expenditure is reclassified as mine development
within property, plant and equipment. All subsequent
development expenditure is capitalised and classified as
mine development, provided commercial viability conditions
continue to be satisfied. On completion of development, all
relevant assets included in mine development are reclassified
as plant and equipment.
Land and buildings
At cost
Accumulated depreciation
and impairment
Plant and equipment
At cost
Accumulated depreciation
and impairment
Motor vehicles
At cost
Accumulated depreciation
Mine development
At cost
Accumulated depreciation
and impairment
Total property, plant and
equipment
31 Dec 2023
31 Dec 2022
$’000
$’000
5,840
(379)
5,461
5,277
(379)
4,898
82,138
73,574
(60,465)
21,673
(59,964)
13,610
952
(456)
496
451
(369)
82
201,519
181,151
(160,060)
(159,710)
41,459
21,441
69,089
40,031
All property, plant and equipment is stated at historical cost
less accumulated depreciation and accumulated impairment
losses. Historical cost includes expenditure that is directly
attributable to the acquisition of the items and costs incurred
in bringing assets into 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.
The carrying amount of any component accounted for as
a separate asset is derecognised when replaced. All other
repairs and maintenance are charged to profit or loss during
the reporting period in which they are incurred. The units of
production basis is used when depreciating mine specific
assets which results in a depreciation charge proportional
to the depletion of the forecast remaining life of mine
production. Changes in factors such as estimates of proven
and probable reserves that affect the unit of production
calculations are applied on a prospective basis.
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
L
S
E
C
R
U
O
S
E
R
E
V
O
R
G
L
L
H
I
40
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
13. PROPERTY, PLANT AND
EQUIPMENT (cont.)
14. EXPLORATION AND EVALUATION
EXPENDITURE
Reconciliations of the carrying amounts for each class of
asset are set out below:
31 Dec 2023
31 Dec 2022
$’000
$’000
The Group accumulates certain costs associated with
exploration activities on specific areas of interest where
the Group has rights of tenure and where exploration and
evaluation activities in the area of interest have not reached a
stage that permits a reasonable assessment of the existence
of economically recoverable reserves.
Land and buildings
Carrying amount at beginning
of period
Additions
Depreciation
Carrying amount at end of
period
Plant and equipment
Carrying amount at beginning
of period
Additions
Depreciation
Transfers
Carrying amount at end of
period
Motor vehicles
Carrying amount at beginning
of period
Additions
Depreciation
Carrying amount at end of
period
Mine development
Carrying amount at beginning
of period
Additions
Depreciation
Transfers
Carrying amount at end of
period
Total property, plant and
equipment
4,898
563
-
5,461
4,898
-
-
4,898
Exploration and evaluation assets are initially measured at
cost and include acquisition and renewal of rights to explore,
drilling, sampling, assaying and depreciation of assets
used in exploration and evaluation activities. General and
administrative costs are only included where they are directly
related to a particular area of interest.
13,610
13,672
7,214
(582)
1,431
22
(84)
-
21,673
13,610
82
501
(87)
496
21,441
21,799
(350)
(1,431)
67
15
-
82
14,647
6,794
-
-
41,459
21,441
69,089
40,031
Exploration and evaluation assets are assessed for
impairment when facts and circumstances suggest that the
carrying amount of an exploration and evaluation asset may
exceed its recoverable amount. The recoverable amount
of the exploration and evaluation asset is estimated to
determine the extent of the impairment loss (if any).
Where an impairment loss subsequently reverses, the
carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but only to the extent
that the increased carrying amount does not exceed the
carrying amount that would have been determined had no
impairment loss been recognised for the asset in previous
periods.
Expenditure on exploration areas of interest where the
prospect of recoupment of costs capitalised through
successful development and commercial exploitation is no
longer considered likely, is charged to the profit or loss as an
impairment charge.
Where a decision has been made to proceed with
development in respect of a particular area of interest,
the relevant exploration and evaluation asset is tested
for impairment and the balance is then reclassified to
development.
31 Dec 2023
31 Dec 2022
$’000
$’000
I
H
L
L
G
R
O
V
E
R
E
S
O
U
R
C
E
S
L
M
T
E
D
I
I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
Exploration and evaluation
expenditure
Carrying amount at beginning
of period
Additions
Government grant income
Impairment loss
Carrying amount at end of
period
5,328
4,784
41
4,784
647
-
(103)
5,328
4,434
678
(304)
(24)
4,784
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
15. TRADE AND OTHER PAYABLES
17. LEASES
The consolidated balance sheet includes the following
amounts relating to leases:
Trade payables
Other payables and accruals
31 Dec 2023
31 Dec 2022
$’000
7,578
6,116
13,694
$’000
130
573
703
Information about the Group’s exposure to liquidity risk is
provided in Note 25(d).
16. PROVISIONS – CURRENT
31 Dec 2023
31 Dec 2022
$’000
1,090
1,090
$’000
766
766
766
736
Rehabilitation provision
Movement in provisions
Carrying value at the
beginning of the period
Payments charged against
provisions:
Rehabilitation provision
Transfer from / (to)
non-current provisions:
Rehabilitation provision
Balance at end of period
The rehabilitation provision is based on estimates for
tenements held and refers to the measures and actions
required to repair land disturbed by exploration and mining
activities. The current balance is in respect of the Kanmantoo
mine tenement.
(97)
(376)
Non-current lease liabilities
Closing balance at
31 December
421
1,090
406
766
Lease liabilities
Opening balance at
1 January 2023
Leases recognised during the
period
Disposals of leases during the
period
Interest expense during the
period
Foreign exchange movement
Lease expense during the
period
Closing balance at
31 December
Lease liabilities of which are:
Current lease liability
31 Dec 2023
31 Dec 2022
$’000
$’000
-
14,005
(577)
278
(173)
(1,716)
11,817
4,311
7,506
11,817
-
-
-
-
-
-
-
-
-
-
The consolidated statement of profit or loss and other
comprehensive income includes the following amounts
relating to leases:
31 Dec 2023
31 Dec 2022
$’000
$’000
Lease expenses
Depreciation charge of right-
of-use assets (included in
expenses)
Interest expense (included in
interest and finance charges)
Expense relating to short-
term leases (included in
expenses)
Expense relating to leases
of low-value assets that
are not shown above as
short-term leases (included
in expenses)
Expense relating to variable
lease payments not included
in lease liabilities (included in
expenses)
(1,530)
278
158
23
763
-
-
-
-
-
The total cash outflow for leases, other than leases not
recognised as lease liabilities, during the year-ended
31 December 2023 was $0.6m (31 December 2022: nil).
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
L
S
E
C
R
U
O
S
E
R
E
V
O
R
G
L
L
H
I
42
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
17. LEASES (cont.)
Contractual maturities of lease liabilities
The maturity profile of lease liabilities based on the undiscounted contractual amounts is as follows:
Less than 1 year
1 to 2 years
Over 2 years
Total cash flows Carrying amount
At 31 December 2023
Lease liabilities
$’000
5,052
$’000
4,473
$’000
3,908
$’000
13,433
$’000
11,817
Movements in the Group’s right-of-use assets during the year
are as follows:
19. PROVISIONS – NON-CURRENT
31 Dec 2023
31 Dec 2022
Plant and
equipment
Plant and
equipment
$’000
$’000
Right-of-use assets
Opening balance at 1 January
-
Additions during the
financial year
Disposals during the
financial year
Depreciation charge for the
financial year
Closing carrying amount
at 31 December
14,005
(675)
(1,530)
11,800
-
-
-
-
-
The Group has entered into new services agreements which
provide rights to use various equipment to be used as part
of the underground mining operations. Accordingly, new
right-of-use assets have been recognised associated with
those arrangements. Corresponding lease liabilities are also
recognised in the consolidated statement of financial position.
18. EMPLOYEE BENEFITS PAYABLE
31 Dec 2023
31 Dec 2022
$’000
$’000
Employee benefits payable
– current
1,594
663
The current provision for employee benefits includes
accrued annual leave, long service leave, and other accrued
remuneration.
The entire amount of employee benefits payable of $1.6
million (2022: $0.7 million) is presented as current since
the Group does not have an unconditional right to defer
settlement for any of these obligations. However, based on
past utilisation, the Group does not expect all employees
to take the full amount of accrued leave or require payment
within the next 12 months.
31 Dec 2023
31 Dec 2022
$’000
$’000
Leave obligations expected to
settle after 12 months
482
425
Rehabilitation provision
Movement in provisions
Carrying value at the
beginning of the period
Discount on unwind of
rehabilitation provision
Transfer (to)/from current
provisions
(Reduce)/increase provision
recognised
Balance at end of period
31 Dec 2023
31 Dec 2022
$’000
8,500
$’000
9,006
9,006
9,314
360
(421)
(445)
8,500
130
(406)
(32)
9,006
The rehabilitation provision is based on estimates for
tenements held and refers to the measures and actions
required to remediate land disturbed by exploration and
mining activities. Closing and restoration costs include
the dismantling and demolition of infrastructure and the
removal of residual materials and remediation of disturbed
areas. Closing and restoration costs are provided for in
the accounting period when the obligation arising from the
related disturbance occurs, whether this occurs during mine
development or during the production phase, based on the
net present value of estimated future costs.
The costs are estimated based on a closure plan. The
cost estimates are calculated annually during the life of the
operation to reflect known developments and are subject
to formal review at regular intervals. The amortisation or
‘unwinding’ of the discount applied in establishing the net
present value of provisions is charged to the statement of
profit or loss and shown as a financial cost.
Included in the rehabilitation provision is a payment of
approximately $1.7 million to the Native Vegetation Fund.
With permission from the State Government, the Group has
delayed the timing of this payment and, whilst the intention
is for the payment to be made in future, it should be noted
that non-payment would increase the Group’s rehabilitation
provision by approximately $1.5 million. This circumstance
is not expected to eventuate.
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O
V
E
R
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S
O
U
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C
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S
L
M
T
E
D
I
I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
43
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
20. DEFERRED INCOME
Government grant
31 Dec 2023
31 Dec 2022
$’000
2,000
2,000
$’000
2,000
2,000
A $2 million grant was received during the period from the South Australian Government to assist with the trial of new
underground mining technology. In accordance with AASB120, the grant has been disclosed as deferred income and, on
the commencement of underground mining operations, will be released to the Consolidated statement of profit or loss and
other comprehensive income over the life of the associated mine development asset.
Subject to the achievement of certain project milestones which are under review, and commercial production from the
underground project, $1 million of the grant may be repayable to the South Australian Government via a 0.25% royalty,
12 months after the first concentrate sale from the underground operation, until the $1m liability is repaid.
21. OTHER FINANCIAL LIABILITIES
Discounted net smelter return royalty – Current
Discounted net smelter return royalty – Non Current
31 Dec 2023
31 Dec 2022
$’000
2,997
4,487
7,484
$’000
-
7,195
7,195
Refer to Notes 1(g) and 2(d) for further information on the net smelter return royalty and Note 25(a) for the potential impact on
the amount payable due to copper price fluctuations.
22. CONTRIBUTED EQUITY
Share capital
Issued and paid up capital for 1,911,971,009 fully paid shares
(31 December 2022: 1,174,289,057)
Ordinary shares issued – movements during the period
31 Dec 2023
$’000
31 Dec 2022
$’000
292,947
256,088
31 Dec 2023
31 Dec 2022
31 Dec 2023
31 Dec 2022
Opening balance
Employee option schemes / issues
Capital raise
Less – transaction costs (net of tax)
No. of shares
No. of shares
1,174,289,057
1,168,169,769
12,500,000
725,181,952
-
6,119,288
-
-
Balance at end of period
1,911,971,009
1,174,289,057
$’000
256,088
-
38,435
(1,576)
292,947
$’000
256,118
-
-
(30)
256,088
3
2
0
2
T
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O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
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S
E
C
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U
O
S
E
R
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V
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Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
Terms and conditions
Holders of ordinary shares are entitled to receive dividends as declared and are entitled to one vote per share at shareholders
meetings. In the event of winding up the Company, ordinary shareholders rank after all other shareholders and creditors and
are fully entitled to any net proceeds of liquidation.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
22. CONTRIBUTED EQUITY (cont.)
Capital risk management
24. ACCUMULATED LOSSES
31 Dec 2023
31 Dec 2022
The Group’s objectives when managing capital are to
safeguard its ability to continue as a going concern, so
it can provide returns for shareholders and benefits for
other stakeholders and to maintain an optimal capital
structure to reduce the cost of capital. In order to maintain
or adjust the capital structure, the Group may adjust the
amount of dividends paid to shareholders, return capital to
shareholders, issue new shares or sell assets.
23. RESERVES
Share based payments
reserve
Profit reserve
Movements:
Share based payments
reserve
Opening balance
Share based compensation
expense
Closing balance
Profit reserve
Opening balance
Transfer of current year profit
Dividend paid
Closing balance
31 Dec 2023
31 Dec 2022
$’000
$’000
9,084
22,082
31,166
7,306
22,082
29,388
7,306
1,778
9,084
6,680
626
7,306
22,082
22,082
-
-
-
-
22,082
22,082
Nature and purpose of reserves
(i)
Share based payments reserve
The share based payments reserve is used to recognise the
fair value of:
½ Share performance rights issued to employees
½ Options granted to the non-executive directors
½ Unlisted options issued to the joint lead managers for
placement and share purchase plans.
(ii) Profit reserve
The profit reserve is used to accumulate distributable profits,
preserving the characteristics of profit by not appropriating
against prior year accumulated losses. The reserve can be
used to pay taxable dividends.
$’000
$’000
At beginning of the period
(252,910)
(246,937)
Net loss (not carried forward
to profit reserve)
Accumulated losses at end
of the period
(16,327)
(5,973)
(269,237)
(252,910)
25. FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial
risks: market risk, foreign exchange risk, credit risk and
liquidity risk. The Group’s overall risk management program
focuses on the unpredictability of financial markets and
seeks to minimise potential adverse effects on the financial
performance of the Group. Risk management is carried
out by senior management under direction of the Board
of Directors. The Board provides principles for overall risk
management, as well as policies covering specific areas.
(a) Market risk
The Group has exposure to copper commodity prices arising
from the royalty agreement entered with Freepoint Metals
and Concentrates LLC during August 2022 (refer Note 2d).
Movements in the realised price of copper will increase/
decrease the associated royalty liability. The below table
details the Group’s sensitivity to movements in the realised
copper price:
31 December 2023
Impact on current value of
royalty payable
Increase
Decrease
$’000
$’000
769
(769)
Impact of 10% increase/
decrease in realised AUD
copper price
(b) Foreign exchange risk
At 31 December 2023, the Group has no US$ denominated
receivables. However, the valuation of the royalty payable to
Freepoint Metals and Concentrates will increase/decrease
in line with movements in the A$/US$ exchange rate. The
sensitivity to this has been reflected in the above market
price table. Additionally, the Group has exposure to FX
changes in relation to AUD payments made for a lease
charged in USD.
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I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
45
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
25. FINANCIAL RISK MANAGEMENT (cont.)
(c) Credit risk
Credit risk is managed on a group basis. Credit risk can arise from cash and cash equivalents, deposits with banks and
financial institutions, derivative financial instruments and receivables. The Group holds its cash with Westpac Banking
Corporation and Commonwealth Bank of Australia which are considered to be appropriate financial institutions.
The Group has trade receivables of $Nil (31 December 2022 $Nil). The maximum exposure to credit risk at the reporting date
is the carrying amount of the financial assets. The group applies the AASB 9 simplified approach to measuring expected
credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. Applying the
principles of the expected credit loss model and historical recovery rates, the Consolidated entity has not recognised a
provision against trade receivables and contract assets.
Trade receivables and contract assets are written off when there is no reasonable expectation of recovery. Indicators that
there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan
with the group, and a failure to make contractual payments.
GST refunds are receivable from a government agency and are deemed to have no significant credit risk.
For banks, financial institutions and third party debtors, management assesses the credit quality of the counterparty, taking
into account its financial position, past experience and other relevant factors.
(d) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding
through an adequate amount of committed credit facilities and the ability to close out market positions. Liquidity risk is
managed on a Group basis. The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and
matching the maturity profiles of financial assets and liabilities.
The Group monitors its cash flow on a regular basis to ensure adequate funds are in place to maintain its payment
obligations when they fall due. The Group and the parent entity had no undrawn borrowing facilities at the reporting date.
Maturities of financial liabilities
The tables below analyse the Group’s financial liabilities into relevant maturity groupings based on the remaining period at the
reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash
flows and includes future interest on borrowings.
Less than
1 year
1 to 2
year(s)
2 to 3
years
3 to 4
years
4 to 5
years
More than
5 years
Total cash
flows
Carrying
amount
31 December 2023 $’000
Trade and other payables
Financial liabilities
Total
13,694
2,997
16,691
-
3,806
3,806
-
3,600
3,600
-
-
-
-
-
-
-
-
-
13,694
10,404
24,098
13,694
7,484
21,178
Less than
1 year
1 to 2
year(s)
2 to 3
years
3 to 4
years
4 to 5
years
More than
5 years
Total cash
flows
Carrying
amount
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
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C
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U
O
S
E
R
E
V
O
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31 December 2022 $’000
Trade and other payables
Financial liabilities
Total
703
237
940
-
3,346
3,346
-
4,105
4,105
-
4,552
4,552
-
265
265
-
-
-
703
12,505
13,208
703
7,195
7,898
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
26. SUBSIDIARIES
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Hillgrove Resources Limited
(the “parent entity”) as at 31 December 2023 and the results of all subsidiaries for the period then ended. Hillgrove Resources
Limited and its subsidiaries together are referred to in this financial report as the Group. Subsidiaries are all entities controlled
by the Group. Control is achieved when the Group has power over the investee, is exposed, or has rights, to variable returns
from its involvement with the investee and has the ability to use its power to affect its returns.
The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. Cost is measured as
the fair value of the assets given, shares issued or liabilities incurred or assumed at the date of exchange. Transaction costs
are expensed as incurred, except if related to the issue of debt or equity securities. Consolidation of a subsidiary begins
when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Profit or loss
and each component of other comprehensive income are attributed to owners of Hillgrove Resources Limited and to the
non-controlling interests where applicable.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
The proportion of ownership interest is equal to the proportion of voting power held. The consolidated financial statements
incorporate the assets, liabilities and results of the following subsidiaries;
Name of controlled entity
Hillgrove Copper Pty Ltd
Hillgrove Copper Holdings Pty Ltd
Hillgrove Exploration Pty Ltd
Hillgrove Mining Pty Ltd
Hillgrove Operations Pty Ltd
Hillgrove Wheal Ellen Pty Ltd
Kanmantoo Properties Pty Ltd
Mt Torrens Properties Pty Ltd
SA Mining Resources Pty Ltd
Hillgrove Indonesia Pty Ltd
PT Hillgrove Indonesia
Country of
incorporation
Class of share
Equity holding
31 Dec 2023 (%)
Equity holding
31 Dec 2022 (%)
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Indonesia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
I
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O
V
E
R
E
S
O
U
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C
E
S
L
M
T
E
D
I
I
There were no transactions with non-controlling interests during the period.
27. COMMITMENTS
(a) Non-cancellable commitments
Future commitments not provided for in the financial statements and payable:
Within one year
One to five years
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
31 Dec 2023
$’000
31 Dec 2022
$’000
16
-
16
47
25
16
41
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
27. COMMITMENTS (cont.)
(b) Exploration expenditure commitments
To maintain current rights of tenure to exploration tenements, the Group is required to perform exploration work to meet the
minimum expenditure requirements under the various exploration licences which are held. These obligations are expected to
be fulfilled in the normal course of operations. Mining interests may be relinquished or joint ventured to reduce this amount.
The SA State Government has the authority to defer, waive or amend the minimum expenditure requirements. Eligible
exploration expenditure includes an appropriate allocation of overhead costs.
Within one year
One to five years
(c) Capital commitments
31 Dec 2023
31 Dec 2022
$’000
487
677
1,164
$’000
1,462
731
2,193
At 31 December 2023, there were no contracted capital commitments (31 December 2022: Nil).
28. NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS
(a) Reconciliation of cash
For the purposes of the consolidated statement of cash flows, cash includes cash on hand and at bank and short term
deposits at call. Cash as at the end of the financial year as shown in the consolidated statement of cash flows is reconciled
to the related items in the consolidated statement of financial position as set out in Note 10.
(b) Reconciliation of operating profit after income tax to net cash provided by operating activities
Operating profit/(loss) after income tax
Add/(less) items classified as investing/financing activities
Gain on sale of fixed assets
Net interest expense
Finance lease payments
Tax expense on capital raise costs
Add/(less) non-cash items
Depreciation and amortisation
Impairment asset write downs
Employee share options
Discount on unwind of rehabilitation provision
Discount on unwind of royalty financial liability
Revaluation of royalty financial liability
Unrealised foreign exchange gain on lease liability
Rehabilitation adjustment
Movement in Comet Vale rehabilitation provision
Changes in operating assets and liabilities
Increase in receivables, prepayments and inventories
Increase / (decrease) in trade creditors and accruals
Increase in right-of-use assets and leases liabilities
Decrease in other operating liabilities
Increase / (decrease) in provisions and employee benefits
Net cash used by operating activities
31 Dec 2023
31 Dec 2022
$’000
(16,327)
$’000
(5,973)
(50)
284
(664)
(675)
746
103
1,036
360
1,692
(1,403)
(175)
(114)
(286)
(1,820)
12,992
(1,513)
(4,473)
748
(9,539)
-
-
13
67
25
626
130
438
889
-
(32)
-
61
(782)
-
-
(1,214)
(5,752)
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
L
S
E
C
R
U
O
S
E
R
E
V
O
R
G
L
L
H
I
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
28. NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS (cont.)
(c) Net debt reconciliation
This section sets out an analysis of net debt and the movements in net debt for each of the periods presented.
31 Dec 2023
31 Dec 2022
Cash and cash equivalents
Financial liabilities – repayable within one year
Financial liabilities – repayable after one year
Net funds / (debt)
$’000
10,240
(7,308)
(11,993)
(9,061)
Reconciliation of movement of liabilities to cash flows arising from financing activities
Other assets
Liabilities from financing activities
Cash & Bank
Liquid
Investments
Financial
liabilities due
within 1 year
Financial
liabilities due
after 1 year
Net debt as at 1 January 2022
Cash flows
Other non-cash movements
Net funds/(debt) as at 31 December 2022
Cash flows
Other non-cash movements
Net funds/(debt) as at 31 December 2023
10,737
(5,432)
-
5,305
4,935
-
10,240
-
-
-
-
-
-
-
-
-
-
-
-
(7,308)
(7,308)
-
(5,868)
(1,327)
(7,195)
-
(4,798)
(11,993)
$’000
5,305
(7,195)
(1,890)
Total
(1,890)
(11,300)
(1,327)
(1,890)
4,935
(12,106)
(9,061)
Non-cash movements represent accrued interest, repayment timing movements between current and non-current and
revaluations.
29. KEY MANAGEMENT PERSONNEL DISCLOSURES
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Cash bonus (accrued)
Share based payments
31 Dec 2023
31 Dec 2022
$
867,112
96,704
201,325
525,349
1,690,490
$
583,212
58,399
-
243,099
884,710
Further detail regarding key management personnel compensation can be found in the Remuneration Report.
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R
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S
O
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S
L
M
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D
I
I
n
A
N
N
U
A
L
R
E
P
O
R
T
2
0
2
3
49
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
30. RELATED PARTY TRANSACTIONS
(a) Parent entities
The parent entity within the Group is Hillgrove Resources Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in Note 26.
(c) Key management personnel
Disclosures relating to key management personnel are set out in Note 29.
(d) Related parties
Loans to controlled entities are eliminated on consolidation.
Hillgrove Copper Pty Ltd is the banker for the Group and re-allocates via loan account all costs that relate to the Group.
Some assets and liabilities previously recognised in the parent Company, mainly consisting of property, plant, equipment
and exploration related assets, have been transferred to the controlled entities via loan account. All these transactions were
recorded at carrying value.
31. EVENTS AFTER THE REPORTING PERIOD
The Company completed a successful capital raising on 26 February 2024, which received firm commitments for gross
proceeds of $10.0 million, split as follows:
½ Tranche 1 Placement of $8.0 million; and
½ Tranche 2 Placement of $2.0 million, which is subject to Foreign Investment Review Board approval.
Furthermore, in January 2024, the company consolidated certain supplier leasing agreements, leading to the relinquishment
of approximately $2.5 million in future lease liabilities.
32. CONTINGENT LIABILITIES
Guarantees
Electranet performance bond to support the build, own,
operate and maintain agreement for installation of transmission
infrastructure at the Kanmantoo site
Security bonds on tenements
31 Dec 2023
$’000
31 Dec 2022
$’000
388
5
393
359
15
374
The consolidated entity has obligations to restore land disturbed under exploration and mining licences. The maximum
obligation to the South Australian Government in respect of the Kanmantoo copper mine has been assessed at a value of
$9.2 million and is secured by the SA Government on a first ranking basis against the assets of the consolidated entity.
3
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
n
I
I
D
E
T
M
L
S
E
C
R
U
O
S
E
R
E
V
O
R
G
L
L
H
I
Separate from the above, a payment of approximately $1.7 million to the Native Vegetation Fund is included within the
rehabilitation provision. With permission from the State Government, the Group has opted to defer this payment. While
the Group plans to fulfill this obligation at a later date, it should be noted that non-payment would result in an increase of
approximately $1.5 million to the Group’s rehabilitation provision. However, such a scenario is not expected to materialise.
50
The Directors are of the opinion that further provisions are not required in respect of these matters, as it is not probable that a
future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement.
The consolidated entity had no other contingent liabilities at 31 December 2023.
Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
33. SHARE-BASED PAYMENTS
(a) Movements in performance rights during the year
31 December 2023
31 December 2022
Number of
performance rights
Weighted average
exercise price ($)
Number of
performance rights
Weighted average
exercise price ($)
Balance at beginning of year
58,500,000
Granted – employees
Granted – non-executive directors
Forfeited during the year
Exercised during the year
Expired during the year
Balance at end of year
Exercisable at end of year
15,000,000
-
(7,197,200)
(12,500,000)
-
53,802,800
-
-
-
-
-
-
-
-
-
51,241,840
16,000,000
-
-
(6,119,288)
(2,622,552)
58,500,000
-
-
-
-
-
-
-
-
-
At the end of the year there were 53,802,800 performance rights outstanding and the weighted average remaining
contractual life at the end of the period was 2.15 years (31 December 2022: 2.38 years).
(b) Summary of performance rights outstanding
2020 OPRP
2021 OPRP
2022 OPRP
2023 OPRP
Director Options Tranche 1
Director Options Tranche 2
Growth OPRP
TOTAL
31 December 2023
31 December 2022
Number of
performance rights
Last exercise date
Number of
performance rights
Last exercise date
-
13,802,800
11,000,000
15,000,000
8,000,000
6,000,000
-
53,802,800
-
30 March 2025
30 March 2026
30 March 2027
14 May 2025
14 May 2026
-
12,500,000
14,500,000
14,500,000
-
8,000,000
6,000,000
3,000,000
58,500,000
30 March 2024
30 March 2025
30 March 2026
-
14 May 2025
14 May 2026
31 July 2024
Further information for each of the outstanding OPRP performance rights are as follows:
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Consideration
Exercise price
Method of settlement
Performance hurdles
2020 OPRP
2021 OPRP
2022 OPRP
2023 OPRP
Growth OPRP
-
-
-
-
-
-
-
-
-
-
Equity
Equity
Equity
Equity
Equity
- Share price target - cents
6.0
8.0
10.0
12.0
- Price calculation methodology
10 day VWAP
10 day VWAP
10 day VWAP
10 day VWAP
-
-
- Start of testing date
1 March 2022
1 March 2023
1 March 2024
1 March 2025
1 August 2021
- First exercise date
- Last exercise date
- Other hurdles
1 March 2023
1 March 2024
1 March 2025
1 March 2026
1 August 2021
30 March 2024
30 March 2025
30 March 2026
30 March 2027
31 July 2024
-
-
-
-
(1)
(1) To substantially advance one or more of the Company’s exploration projects to the point where a JORC Mineral Resource is approved
by the Board to advance to a funded Definitive Feasibility Study. These rights were forfeited during the period.
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
33. SHARE-BASED PAYMENTS (cont.)
In addition, further information for each of the outstanding director options are as follows:
Consideration
Exercise price
Method of settlement
Grant date
First exercise date
Last exercise date
(c) Additional information on rights issued during the year
Tranche 1
-
$0.10/share
Equity
14 May 2021
14 May 2023
14 May 2025
Tranche 2
-
$0.15/share
Equity
14 May 2021
14 May 2024
14 May 2026
Grant date
Valuation date
Consideration
Exercise price
Number of rights granted
Performance hurdles
- Share price target - cents
- Price calculation methodology
- Start of testing date
- First exercise date
- Last exercise date
Valuation
- Performed by
- Methodology
- Share price volatility
- Expected dividend yield
- Risk free interest rate
- Valuation per right - cents
2023 OPRP
1 July 2023
28 April 2023
-
-
15,000,000
12.0
10 day VWAP
1 March 2025
1 March 2026
30 March 2027
External advisers
Binomial
70%
0%
3.6%
3.90
(d) Movements in options during the year – capital raise lead managers
Balance at beginning of year
Granted
Forfeited during the year
Exercised during the year
Expired during the year
Balance at end of year
31 December 2023
31 December 2022
Number of options
20,000,000
35,000,000
-
-
-
Weighted average
exercise price ($)
Number of options
Weighted average
exercise price ($)
0.0780
0.0795
-
-
-
20,000,000
0.0780
-
-
-
-
-
-
-
-
55,000,000
0.0790
20,000,000
0.0780
At the end of the year there were 55,000,000 options outstanding and the weighted average remaining contractual life at the
end of the period was 1.75 years (31 December 2022: 1.75 years).
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Notes to the Consolidated Financial Statements for the year ended 31 December 2023 (cont.)
33. SHARE-BASED PAYMENTS (cont.)
(e) Expenses arising from share-based
34. PARENT ENTITY INFORMATION
The financial information for the parent entity, Hillgrove
Resources Limited, has been prepared on the same basis
as the consolidated financial statements, except as set out
below.
payment transactions
Total expenses arising from share-based payment
transactions recognised during the period as part of
employee benefit expense were as follows:
Performance rights issued
under the OPRP:
Equity based
Cash based
31 Dec 2023
31 Dec 2022
$’000
$’000
1,036
-
1,036
626
-
626
During the period, the expensed share based payment
amounts were calculated based on an adjusted form of the
Black Scholes Model, third party valuation using a Monte
Carlo simulation approach, or share price on the date of
issue against the probability that they will vest.
Investments in subsidiaries are accounted for at cost in
the financial statements of Hillgrove Resources Limited.
Dividends received from associates are recognised in the
parent entity’s profit or loss, rather than being deducted from
the carrying amount of these investments.
Set out below is the supplementary information about the
parent entity.
Parent
31 Dec 2023
31 Dec 2022
$’000
(14,790)
(14,790)
10,308
55,688
812
812
$’000
(1,838)
(1,838)
5,371
31,475
445
445
54,876
31,030
292,947
15,950
256,088
14,172
Profit / (loss) after income tax
Total comprehensive income
Statement of financial
position
Total current assets
Total assets
Total current liabilities
Total liabilities
Net assets
Shareholder’s equity
Contributed equity
Reserves
Accumulated losses
(254,021)
(239,230)
Total equity
54,876
31,030
Material Accounting Policies
The accounting policies of the parent entity are consistent
with those of the consolidated entity, disclosed throughout
the report and notes. Investments in subsidiaries are
accounted for at cost, less any impairment.
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Directors’ Declaration
In the Directors’ opinion:
(a)
the financial statements and notes set out on pages 28 to 53 are in accordance with the Corporations Act
2001, including:
(i)
(ii)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements; and
giving a true and fair view of the consolidated entity’s financial position as at 31 December 2023 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.
Note 1(a) confirms that the financial statements also comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board.
The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by
section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the Directors.
Dated at Adelaide this 26th day of February 2024.
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Mr Derek Carter
Chairman
Mr Lachlan Wallace
Managing Director
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Independent Auditor’s Report to the Members of Hillgrove Resources Limited
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PricewaterhouseCoopers, ABN 52 780 433 757 Level 11, 70 Franklin Street, ADELAIDE SA 5000, GPO Box 418, ADELAIDE SA 5001 T: +61 8 8218 7000, F: +61 8 8218 7999 Liability limited by a scheme approved under Professional Standards Legislation. Independent auditor’s report To the members of Hillgrove Resources Limited Report on the audit of the financial report Our opinion In our opinion: The accompanying financial report of Hillgrove Resources Limited (the Company) and its controlled entities (together 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 31 December 2023 and of its financial performance for the year then ended (b) complying with Australian Accounting Standards and the Corporations Regulations 2001. What we have audited The Group financial report comprises: • the consolidated statement of financial position as at 31 December 2023 • the consolidated statement of changes in equity for the year then ended • the consolidated statement of cash flows for the year then ended • the consolidated statement of profit or loss and other comprehensive income for the year then ended • the notes to the consolidated financial statements, including material accounting policy information and other explanatory information • the directors’ declaration. 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
Independent Auditor’s Report to the Members of Hillgrove Resources Limited (cont.)
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Independent auditor’s report - Hillgrove Resources Limited (continued) 2 Our audit approach An audit is designed to provide reasonable assurance about whether the financial report is free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report. We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial report as a whole, taking into account the geographic and management structure of the Group, its accounting processes and controls and the industry in which it operates. Audit scope Key audit matters • Our audit included assessing the financial statements for risks of material misstatement based on quantitative and qualitative assessment of Hillgrove’s operations and activities. • Our audit also focused on where the Group made subjective judgements; for example, significant accounting estimates involving assumptions and inherently uncertain future events. • The Group’s accounting records are held and managed at the Kanmantoo site and the corporate head office, located in Adelaide. • Through its ownership of the Kanmantoo copper mine, the Group has one operating segment being in the resources industry, in Australia. We performed an audit of this operating segment given its financial significance to the Group during the year. • Amongst other relevant topics, we communicated the following key audit matters to the Audit and Risk Committee: − Capitalisation of development expenditure − Lease accounting • These are further described in the Key audit matters section of our report. 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 for the current period. The key audit 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. Further, any commentary on the outcomes of a particular audit procedure is made in that context. Key audit matter How our audit addressed the key audit matter Capitalisation of development expenditure (Refer to note 13) As at 31 December 2023, $41.5 million of development expenditure has been capitalised to the balance sheet. We considered capitalisation of development We performed the following procedures, amongst others: • Considered the latest available information regarding the project through inquiries of management and the directors, and inspection of relevant press releases; • For a sample of mine development expenditure,
Independent Auditor’s Report to the Members of Hillgrove Resources Limited (cont.)
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Independent auditor’s report -Hillgrove Resources Limited(continued)3Key audit matterHow our audit addressed the key audit matterexpenditure akey audit mattergiven it is a financially significant balance due to the renewed mining activityof the Kanmantoo copper mine underground developmentin 2023.we:oAssessed the appropriateness of thecapitalisation of costs in accordance withthe requirements of AustralianAccounting Standards;andoTested the accuracy of the capitalisationof costs to invoices or other supportingdocuments.•Assessed the reasonableness of disclosures inthe financial report havingregard to therequirements of Australian Accounting Standards.Lease accounting(Refer to note 17) The Group recognised total lease liabilities of $11.8 million and right of use assets of $11.8 million as at 31 December 2023.Lease accounting wasconsidered a key audit matter becauseof the:•Financial significance of the leasebalances included in the financialreport due to renewed mining activity;and•Significant judgements and estimatesapplied by the Group:oTo identify the lease and non-lease componentswhere acontract includes the provision ofnon-lease services; andoIn the determination of theincremental borrowing rate tomeasure lease liabilitieswhere theGroup cannot readily determinethe interest rate implicit in theleaseWe performed the following procedures, amongst others:•Assessed whether the Group’s accountingpolicies were in accordance with therequirements of Australian Accounting Standards;•Testeda sample of lease agreements enteredinto during the year,including:oComparing lease calculation input data to thelease agreementsand consideringwhetherthey have been accounted for in accordancewith the Group’s accounting policy andAustralian Accounting Standards;oAssessingthe mathematical accuracy oflease calculations;andoEvaluatingthe appropriateness of thesignificant assumptions used by the Group incalculating the lease balances,including:▪Consideringlease and non-leasecomponents through assessingtheterms and conditions per theunderlying contract; and▪Assessingthe Group’s discount rateused:•For leases with a purchase option,evaluatingthe internal rate of returnon the purchase option against thehire term; and•For leases without a purchaseoption, obtainingsupportingevidence for the basis of the
Independent Auditor’s Report to the Members of Hillgrove Resources Limited (cont.)
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Independent auditor’s report - Hillgrove Resources Limited (continued) 4 Key audit matter How our audit addressed the key audit matter incremental borrowing rate calculation. • Assessed the reasonableness of disclosures in the financial report having regard to the requirements of Australian Accounting Standards. Other information The directors are responsible for the other information. The other information comprises the information included in the annual report for the year ended 31 December 2023, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon through our opinion on the financial report. We have issued a separate opinion on the remuneration report. 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 on the other information that we obtained prior to the date of this auditor’s report, 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 ability of the Group 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
Independent Auditor’s Report to the Members of Hillgrove Resources Limited (cont.)
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Independent auditor’s report - Hillgrove Resources Limited (continued) 5 if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our auditor's report. Report on the remuneration report Our opinion on the remuneration report We have audited the remuneration report included in the directors’ report for the year ended 31 December 2023. In our opinion, the remuneration report of Hillgrove Resources Limited for the year ended 31 December 2023 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards. PricewaterhouseCoopers Julian McCarthy Adelaide Partner 26 February 2024
Shareholder Information for Listed Public Companies
The following additional information is required by the Australian Securities
Exchange Limited in respect of listed public companies only.
As at the reporting date the most recent Shareholder information available for
disclosure is as follows:
(a) Voting rights and classes of equity securities
As at 29 January 2024, the Company has 1,911,971,009 listed fully paid ordinary
shares. Each fully paid share carries on a poll one vote.
The company also has 44,000,000 unquoted performance rights and 69,000,000
options on issue which do not carry voting rights.
(b) Unmarketable parcels
The number of shareholders holding less than a marketable parcel of ordinary
shares was 1,592 as at 29 January 2024.
(c) Distribution schedule of Fully Paid Ordinary Shares
as at 29 January 2024
Size of holding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Number of shareholders
443
986
637
2,203
1,158
5,427
(d) Securities exchange listing
Quotation has been granted for all the ordinary shares of the Company on all
Member Exchanges of the Australian Securities Exchange Limited. The ASX code
is HGO.
(e) Company Secretary
Mr Joe Sutanto is the Company Secretary.
(f) On-market buy-back
There is no current on-market buy-back.
(g) Substantial shareholders as at 29 January 2024
An extract of the Company’s register of Substantial Shareholders (who hold 5.0%
or more of the issued capital) in accordance with Form 604 Notices is set out
below:
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Freepoint Metals and Concentrates
Ariadne Australia Limited
60
Issued capital
19.98%
11.28%
Shareholder Information for Listed Public Companies (cont.)
Twenty largest listed shareholders
The twenty largest shareholders hold 50.0% of the total ordinary shares issued.
The 20 largest shareholdings as at 29 January 2024 are listed below:
Shareholder
1
2
3
4
5
6
7
8
9
Bell Potter Nominees
Portfolio Services Pty Ltd
Mr Raymond Edward Munro
Citicorp Nominees Pty Ltd
Portfolio Services Pty Ltd
Portfolio Services Pty Ltd
UBS Nominees Pty Ltd
Portfolio Services Pty Ltd
BNP Paribas Nominees Pty Ltd
10 Curious Commodities Pty Ltd
11 Proco Pty Ltd
12 Proco Pty Ltd
13
Zero Nominees Pty Ltd
14 Portfolio Services Pty Ltd
15 Mr Antony Gordon Breuer
16 Mr Mal Nichols & Andrew Constantine
17 Portfolio Services Pty Ltd
18 Barolo TNC CT Pty Ltd
19
J P Morgan Nominees Australia
20 Cosell Pty Limited
(h)
Interests in mining tenements
No. of ordinary
shares held
% of issued
shares
382,022,134
20.0%
69,812,355
61,900,000
58,161,105
42,337,067
37,735,850
35,433,962
30,961,163
30,400,953
30,000,000
24,180,000
23,720,000
20,000,000
17,546,894
16,183,963
15,363,115
15,322,581
15,094,340
14,977,795
14,600,000
3.7%
3.2%
3.0%
2.2%
2.0%
1.9%
1.6%
1.6%
1.6%
1.3%
1.2%
1.0%
0.9%
0.8%
0.8%
0.8%
0.8%
0.8%
0.8%
955,753,277
50.0%
Tenement
ML 6345
ML 6436
EML 6340
EL 6526
EL 6174
EL 6175
EL 6207
EL 6208
EL 6294
EL 6397
Location
Percentage
Kanmantoo, South Australia
Kanmantoo, South Australia
Kanmantoo, South Australia
Kanmantoo, South Australia
Coomandook, South Australia
Coonalpyn, South Australia
Tintinara, South Australia
Carcuma, South Australia
Wynarka, South Australia
Laffer, South Australia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
(i) Other information
Hillgrove Resources Limited, incorporated and domiciled in Australia, is a publicly
listed company limited by shares.
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HILLGROVE RESOURCES LIMITED
ACN 004 297 116
Adelaide Office
Ground Floor
5-7 King William Road
Unley, SA 5061
Australia
T: +61 8 7070 1698
E: info@hillgroveresources.com.au
W: www.hillgroveresources.com.au