Annual Report
2022
Acknowledgement
of Country
Northern Star would like to acknowledge and pay our
respects to Traditional Owner groups, upon whose land
our operations in Australia are situated.
• Whadjuk Noongar
• Marlinyu Ghoorlie
• Maduwongga
• Kakarra
• Kultju
• Tjiwarl
• The Wiluna Martu
• Wajarri Yamatji
• Darlot
• Nyalpa Pirniku
• Warlpiri, Gurindji and Jaru
Northern Star would like to acknowledge and pay our
respects to the Athabascan people, upon whose ancestral
lands our Pogo Operation in Alaska, is situated.
We seek and value the guidance and input of these
indigenous groups in the operation of our business.
We acknowledge their strong and special physical and
cultural connections to their ancestral lands on which we
are privileged to operate.
Who We Are
Northern Star is one of the world's ten largest
gold miners, with operating mines and exploration
programs in Western Australia and Alaska.
Our Purpose
To generate superior returns for our shareholders,
while providing positive benefits for our stakeholders,
through operational effectiveness, exploration and
active portfolio management.
Where We OPerATe
Where We OPerATe
Where We Operate
We own and operate three high-quality gold production centres: Kalgoorlie,
Yandal and Pogo, all located in world class jurisdictions.1
Figure 1 North American Operations
Pogo Production
Centre
• Pogo
A l a s k a
4
Fairbanks
Delta
Junction
Anchorage
JUNEAU
Figure 2 Australian Operations
Tanami Project*
8. Central Tanami Project JV (50%)
9. Tanami Regional
10. Western Tanami
DARWIN
DARWIN
Yandal Production
Centre
1. Jundee
2. Bronzewing
3. Thunderbox
Kununurra
Kununurra
Halls Creek
Halls Creek
N o r t h e r n
N o r t h e r n
Te r r i t o r y
Te r r i t o r y
8-9-10
Nanutarra
Nanutarra
Newman
Newman
We s t e r n
We s t e r n
A u s t r a l i a
A u s t r a l i a
Alice
Alice
Springs
Springs
5
1
1
2
2
3
3
Wiluna
Wiluna
Leinster
Leinster
Kalgoorlie/Boulder
Kalgoorlie/Boulder
Coolgardie
Coolgardie
4
4
5
5
6
6
7
7
Kambalda
Kambalda
PERTH
PERTH
Kalgoorlie Production
Centre
4. Carosue Dam
5. Kanowna Belle
6. KCGM
7. South Kalgoorlie
1. Fraser Institute Annual Survey of Mining Companies 2021, Investment Attractiveness Index ranks Western Australia as 1st and Alaska as 4th in the world (up from
number 4 and 5 in 2020, respectively). For more information see the full survey at https://www.fraserinstitute.org/sites/default/files/annual-survey-of-mining-
companies-2021.pdf
*
Paulsens and Western Tanami assets were divested on 15 June 2022, see ASX Announcement: https://www.nsrltd.com/investor-and-media/asx-
announcements/2022/june/northern-star-completes-paulsens-and-western-tanam.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FY22 SNAPShOT
FY22 SNAPShOT
Operational highlights
eSG highlights
Strong FY22 results achieved notwithstanding significant
external operating challenges.
For more information on our ESG performance, see our FY22
Sustainability Report at https://www.nsrltd.com/sustainability.
Cash earnings
revenue
Underlying eBITDA
eSG
emissions reduction target
economic value add
$1.0B
up 58% from FY21
(Underlying EBITDA less
sustaining capital, net
interest & corporate tax)
$3.7B
up 35% from FY21
$1.5B
up 31% from FY21
0 incidents
Nil community or heritage
incidents; nil fatalities
35% by 2030
Scope 1 and 2 absolute
Emissions relative to
1 July 2020 baseline of
931ktCO2-e
$3.35B
direct and indirect
economic value add
Liquidity
Cash and bullion
Declared dividends
Local spend
Local employment
Female employees
6
$1.5B
$628M
$250M
total FY22 dividends declared
(interim & final)
Group resources
Group reserves
Organic growth
56.4 Moz
Mineral Resources stable
despite mining depletion
& portfolio optimisation
20.7 Moz
+ 1 Moz
Ore Reserves stable despite
mining depletion & portfolio
optimisation
Organic growth in
Mineral Resources at
both Pogo and KCGM
75%
Group procurement
in WA; 24% Group
spend in local regions
Safety – LTIs
LTIFr 0.5
60%
of total workforce local
23%
4% above Industry
average
7
Safety – LTIs + rWIs
TrIFr 2.0
Approximately ¼ of Industry average
Approximately 1 /3 of Industry average
2.5
2.0
1.5
1.0
0.5
0
2.1
2.0
1.9
10.0
9.1
1.6
0.9
0.5
0.5
0.5
6.4
3.3
3.3
6.2
5.6
8.0
6.0
4.0
2.0
0
5.7
2.0
FY19
FY20
FY21
FY22
FY19
FY20
FY21
FY22
Northern Star
Industry average
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 LeTTer FrOM The MANAGING DIreCTOr & CeO AND ChAIrMAN
LeTTer FrOM The MANAGING DIreCTOr & CeO AND ChAIrMAN
Letter from the
Managing Director & CeO
and Chairman
Dear shareholder,
On behalf of the Board of Directors of
Northern Star Resources Ltd, we are
delighted to present to you the Annual
Report for the financial year ended 30 June 2022.
8
During the year we saw extraordinary efforts applied
to manage a very challenging and dynamic period
for our workforce in Australia and the US. We
experienced cost pressures across the operations
(notably in relation to labour, steel, fuel and energy)
and continuing skill shortages. The COVID-19
disruption continues to impact workforce numbers
and we adjust our plans accordingly. These impacts
are being experienced globally. Our outlook remains
positive with significant progress made to continue
our profitable growth plans.
The safety and wellbeing of our people is integral to
our success. Our outstanding safety performance
with a TRIFR of 2.0 is clear evidence of continual
safety improvement, consistent with the STARR
Core Values of Safety, Teamwork, Accountability,
Respect and Results in one of the most challenging
operational environments the Company has been
through.
We have advanced the rights of Indigenous people
and the need for their active participation in
matters that affect them. It is clear from our recent
discussions that Traditional Owners of the land
on which we operate want to work in partnership
with Northern Star to develop sustainable, long-
term employment and business development
opportunities. We are working together to improve
the opportunities and change lives for the better in
the communities in which we operate.
Northern Star is in a strong position, with gold sold
of 1.56 million ounces in FY22, generating Cash
Earnings of over $1 billion. At 30 June 2022 we held
cash and bullion of $628 million and liquidity of $1.5
billion all underpinned by a solid platform of 56.4
million ounces Mineral Resources and 20.7 million
ounces Ore Reserves. Interim and final dividends
paid to our shareholders totalled $227.1 million this
year.
We are a sustainable, self-funded business currently
focused on opportunities to lower the costs of
production, simplify the business with the purpose
of generating superior returns for our shareholders,
and progressing projects to achieve reduction in
reliance on carbon based energy sources. We have
three large scale production centres in world class
locations, and we are increasing mine life in our
existing mines and investing in expansions and new
fleets to maximise efficiencies.
Key to this all is the significant effort and delivery
from our workforce during FY22. Our operational
teams across Kalgoorlie, Yandal and Pogo have
met the challenge to deliver a significantly stronger
business with a bright outlook.
On behalf of the Board, we hope you enjoy reading
this Report, and we thank you for your support as a
shareholder.
Yours sincerely
9
Stuart Tonkin
Managing Director
& CEO
Michael Chaney AO
Chairman
Kanowna Belle, Kalgoorlie Production
Centre, Western Australia
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
STArr COre VALUeS
IN ThIS rePOrT
STArr Core Values
Our Core Values are integral to the working
lives of all our workers and operations.
Safety
It matters and
starts with you
results
We deliver on
our promises
Teamwork
Together
we can
10
respect
To get it you
must give it
Accountability
The responsibility
lies with you
Forward Looking Statements
Northern Star Resources Limited has prepared this Report based on
information available to it. No representation or warranty, express or
implied, is made as to the fairness, accuracy, completeness or correctness
of the information, opinions and conclusions contained in this Report. To
the maximum extent permitted by law, none of Northern Star Resources
Limited, its directors, employees or agents, advisers, nor any other person
accepts any liability, including, without limitation, any liability arising from
fault or negligence on the part of any of them or any other person, for any
loss arising from the use of this Report or its contents or otherwise arising
in connection with it.
In This report
Acknowledgement of Country
Who We Are & Our Purpose
Where We Operate
FY22 Snapshot
Letter from the MD & CEO and Chairman
STARR Core Values
Leadership Team
Operating and Financial Review
Resources & Reserves
Directors’ Report
Remuneration Report
Auditor's Independence Declaration
Financial Report
Directors’ Declaration
Independent Auditor's Report
Corporate Information
11
2
3
4
6
8
10
12
15
41
49
65
102
105
166
168
175
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 LeADerShIP TeAM
LeADerShIP TeAM
Leadership Team
Stuart Tonkin
Managing Director & CeO –
commenced 2013
ryan Gurner
Chief Financial Officer –
commenced 2015
Simon Jessop
Chief Operating Officer –
commenced 2021
Mr Tonkin is a mining engineer with more
than 25 years’ experience working in the
underground hard-rock mining industry.
He was appointed Chief Executive Officer
of Northern Star in November 2016 and
had been the Company’s Chief Operating
Officer since 2013. Mr Tonkin was appointed
Managing Director on 22 July 2021. Prior to
joining Northern Star, he was Chief Operating
Officer for mining contractor Barminco,
and a Non-Executive Director of African
Underground Mining Services Ghana. He
has extensive experience in the production
of gold, copper, zinc and nickel and has held
senior operational positions with Oxiana and
Newmont in Western Australia.
Mr Tonkin holds a Bachelor of Engineering
(Mining) Degree with Honours from the
Western Australian School of Mines and WA
First Class Mine Managers Certificate.
Mr Gurner is a Chartered Accountant
with extensive financial and commercial
experience spanning over 20 years' across
Australia, Asia and Europe. Prior to joining
Northern Star, Mr Gurner was the CFO and
Company Secretary of ASX & TSX listed RTG
Mining Limited. Previously he has performed
senior financial roles at Sakari Resources
Limited, a SGX listed top 50 company, ASX
listed Mincor Resources Limited and was
Manager at PwC Perth and London Offices.
Mr Gurner was re-appointed Chief Financial
Officer of Northern Star in December 2021
after previously being in the CFO role prior to
the merger with Saracen in February 2021.
Mr Gurner holds a Bachelor of Science
Degree with Honours and a Bachelor of
Commerce Degree.
Mr Jessop is a mining engineer with over 25
years’ of technical and operational experience
in the mining industry covering underground
and open pit operations throughout Australia.
Prior to joining Northern Star, Mr Jessop
was COO at Saracen and has held numerous
General Manager roles for Evolution Mining.
Previous roles have included Operations
Manager at Panoramic Resources at
Lanfranchi Nickel Project, Manager of
Projects at Panoramic Resources, Project
Manager – Agnew and Cosmos for Byrnecut
Australia Pty Ltd as well various other roles
throughout his tenure.
Mr Jessop studied at the WA School of
Mines in Kalgoorlie achieving a Bachelor of
Engineering (Mining) as well as a Bachelor of
Science (Mine and Engineering Surveying).
Mr Jessop holds of a First Class Mine
Managers Certificate of Competency.
12
Daniel howe
Chief Geological Officer –
commenced 2021
Marianne Dravnieks
executive Manager People &
Culture – commenced 2021
Sophie Spartalis
General Manager Investor
relations – commenced 2021
Mr Howe is a Geologist with 20 years’
experience, with a variety of leadership roles
in open pit and underground operations
covering both gold and nickel.
Mr Howe held a number of senior operational
roles covering both underground and open
pit mines with Gold Fields Australia, before
joining Saracen in 2011 as Geology Manager
– Production and Resources. Mr Howe was
promoted to General Manager of Geology
& Exploration at Saracen in 2013, before
becoming Chief Geologist in 2015. Post
merger in 2022 he was appointed as Chief
Geological Officer.
Mr Howe studied at Queensland University of
Technology achieving a Bachelor of Applied
Science (Geoscience) and at The University
of Western Australia achieving a Bachelor of
Science (Geology) Hons.
Ms Dravnieks is a senior Human Resources
professional with over 30 years' of
experience in a variety of roles working in
resources, FMCG and services industries
including organisations such as Alcoa, Perilya,
Focus Minerals and Lion Pty Ltd as well
as her own consulting business. She has a
passion for engaging and aligning people
within businesses to achieve outstanding
results.
In 2018 Ms Dravnieks was recruited as
General Manager - People, Culture &
Communications of Saracen, and on
merger with Northern Star in February 2021
appointed Executive Manager People &
Culture. She leads, and provides strategic
management and support on, people, culture
and internal communications.
Ms Dravnieks holds a Masters Degree in
Leadership & Management and a Graduate
Certificate in Business from Curtin University,
a Diploma in Positive Psychology and is an
AICD Company Director’s Course Graduate.
Ms Spartalis has over 20 years’ experience
working in equity markets, primarily across
the mining and materials sector. Prior to her
appointment with Northern Star as General
Manager – Investor Relations in November
2021, she was a Director at Bank of America
where she acquired a wealth of knowledge
of financial analysis/valuation, strategy
and extensive industry knowledge, along
with awareness of institutional shareholder
behaviours. Ms Spartalis was a top ranked
sell-side equity research analyst receiving
many industry awards, including Starmine
Award for Top Stock Picker (Metals
and Mining) in 2019. Combined with an
Engineering and Management Consulting
background, Sophie has a unique, broad and
valuable skill set.
Ms Spartalis holds a Bachelor of Engineering
and a Bachelor of Science with 1st Class
Honours from the University of Western
Australia.
13
Steven McClare
Chief Technical Officer –
commenced 2021
Michael Mulroney
Chief Development Officer –
commenced 2015
hilary Macdonald
Chief Legal Officer & Company
Secretary – commenced 2016
Mr McClare is a mining engineer with over
30 years' of technical, operational and project
experience. His extensive career includes ma-
jor Australian mining companies OZ Minerals,
Newcrest Mining, Newmont Mining, Nor-
mandy Gold and Mount Isa Mines, in addition
to five years as Managing Director of ASX
listed Hillgrove Resources, building multi bil-
lion dollar caving projects at Telfer and Cadia
Valley as well as bringing mines from design
through to production. His most recent role
was Chief of Australian Operations with OZ
Minerals and prior to that he was their Chief
Technical Officer.
Mr McClare’s role at Northern Star provides
both technical & people leadership and
supporting the efficient delivery of long-term
company strategy, group projects and North
American Operations.
Mr McClare studied at the WA School of
Mines in both Collie and Kalgoorlie achieving
a Bachelor of Engineering (Mining with Hons)
and a First Class Mine Managers Certificate
of Competency.
Mr Mulroney is a resource industry
professional with over 40 years' of
technical, corporate management and board
experience across several investment banks
and ASX listed companies, gaining extensive
experience in exploration, development,
project finance and mergers & acquisition
within the global resources sector.
Commencing with Northern Star in 2015
as Chief Geological Officer, his previous
roles include senior executive and board
experience across both gold, base metals and
energy sectors.
Mr Mulroney holds a Bachelor of Applied
Science (Geology) and Master of Business
Administration degrees from Curtin
University.
Ms Macdonald is a lawyer with over 30 years’
experience in private practice and industry
with particular focus on corporate and mining
law.
Prior to her appointment as Northern Star’s
General Counsel in 2016 with executive
responsibility for legal, Ms Macdonald has
provided legal services to Northern Star
continuously since 2009, commencing
with the acquisition of the Paulsens gold
operations.
Ms Macdonald was appointed Chief Legal
Officer in 2021 and Company Secretary in
2018.
In addition Ms Macdonald has executive
responsibility for Environment, Social
Performance and ESG engagement.
A Law Graduate of Bristol University,
England, Ms Macdonald qualified as a
solicitor in London and was admitted to the
Supreme Court of England and Wales in
1990, and to the Supreme Court of Western
Australia in 1995.
Steven Van Der Sluis
General Manager – NSMS
– commenced 2014
Mr Van Der Sluis has over 30 years
experience in underground mining, working
for industry leading companies such as
Henry Walker Eltin, Byrnecut and Barminco.
Starting as an Operator and quickly moving
into a leadership role, for the past 15 years Mr
Van Der Sluis had fulfilled Project Manager
and Operations Manager roles working on
a multitude of projects across Australia and
internationally.
Mr Van Der Sluis commenced with Northern
Star in 2014 at Paulsens, and was appointed
Operations Manager in 2017 and General
Manager in 2018. Since commencing with the
Company, Mr Van Der Sluis has been integral
to expansion of the mining services subsidiary
of Northern Star, including the managing of
the underground mining services during the
acquisition of EKJV, Kanowna Belle, Pogo
and South Kalgoorlie and new sites such as
Millennium and most recently Ramone.
Daniel Boxwell
Operations Manager – NSMS
– commenced 2015
Mr Boxwell is a Mining Engineer with over
12 years in underground mining both in
Australia and overseas. After graduating
with a Bachelor of Engineering from the
West Australian School of Mines (WASM),
Mr Boxwell worked for both Orica
Mining Services and Barrick Gold before
commencing with Northern Star in 2015.
During his time with Northern Star, Mr
Boxwell has held various roles across both
technical and operational areas. Starting off
as a Mining Engineer at Plutonic & Jundee,
he quickly transitioned into operational roles
with Northern Star Mining Services (NSMS)
working as a Shift Supervisor, Mine Foreman
& Project Manager. Now as the Operations
Manager at NSMS, Mr Boxwell oversees the
underground mining services of 6 operations
in both Australia and Alaska.
Denis Sucur
Maintenance Manager – NSMS
– commenced 2012
Mr Sucur learnt his trade in the mining
industry and now has over 21 years
experience in the underground mining
services both in Australia and overseas and
is a specialist in underground mobile fleet
maintenance. Prior to commencing with
Northern Star Mining Services in 2012, he
held leadership roles in several underground
mining services companies.
Initially commencing as a Leading Hand
at Paulsens, Mr Sucur has progressed in
his career whilst at Northern Star, having
occupied Maintenance Foreman and
Maintenance Coordinator roles prior to
being appointed Maintenance Manager in
2021. In his current role, Mr Sucur oversees
all maintenance services for Northern Star
Mining Services across Australia and Alaska.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Operating
and Financial
review
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Operations review
This Operating and Financial Review outlines key information
on our FY22 operations, financial position, and our business
strategies and prospects for future financial years. It supplements,
and should be read in conjunction, with our Financial Report.
Our efforts during FY22 while facing
external market challenges plus managing
COVID-19 and integrating the assets under
one Northern Star have created an enviable and
extremely strong platform for us to realise and
deliver on our five-year growth strategy in FY26.
Northern Star maintains focus on the organic
growth of our assets through targeted exploration
programs and expanding the operating lives of our
existing operations to generate superior returns for
shareholders. To progress achievement of our Net
Zero Ambition, in FY22 our technical teams focused
on assessing our current operating methods for
effectiveness, efficiency and possible adaptions in
16
favour of emission reducing techniques. Northern
Star is committed to its Net Zero Ambition. More
information is available in Northern Star's FY22
Sustainability Report at https://www.nsrltd.com/
sustainability.
Exploring potential acquisitions and investing
in exploration to unlock value from the gold
endowment across our highly prospective ground,
located exclusively in the low sovereign-risk
jurisdictions of Australia and North America, remains
the Company’s strategy for growth.
FY22 Operations review
Northern Star has had an exceptional year of
significant safety performance improvement, along
with strong production. The TRIFR of 2.0 is an
outstanding result, well below industry and achieved
in a dynamic, challenging operational environment.
The performance of the Western Australian
production centres of Kalgoorlie (including KCGM)
and Yandal delivered FY22 production and cost
guidance. Production performance at our Pogo
Operation located in Alaska, USA substantially
improved, with a milestone run rate of 250kozpa
achieved in H2 of FY22. The Group met the gold
production and cost guidance for the year while still
facing significant external operating challenges.
In addition to our strong production results, in FY22
we delivered on our Purpose to generate superior
shareholder returns through active and disciplined
portfolio management, demonstrated by:
• the acquisition of a 50% interest in the 110MW
Parkeston Power Station1 and associated
infrastructure which adds significant operating
flexibility and will assist integration of renewables
at KCGM; Jundee and Thunderbox. This is due to
three key factors: firstly the operations are now
interconnected via a gas pipeline, secondly the
ability to import was increased 65% to 52MW
and thirdly the ability to export (commercial sale)
as a retailer; and
• consolidation of our asset portfolio with the
divestment of non-core assets:
-
-
the EKJV, Kundana and Carbine assets for
$402M on 18 August 20212; and
the Western Tanami and Paulsens projects for
$44.5M on 15 June 20223.
.
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1
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2
.
3
The FY22 exploration program was successful in
replacing Mineral Resources and Ore Reserves, as
depleted by mining activity and reduced by non-
core asset divestments. Group Resources were
maintained at 56.4Moz, and Reserves at 20.7Moz
over the 9-month period to 31 March 2022 post
depletion. Maintaining an enviable resource and
reserve statement is crucial to Northern Star
achieving our five-year strategy announced in July
2021 to grow production to 2Moz per annum by
FY26. In the first year of the strategy we delivered
significant progress towards securing the profitable
growth pathway:
• Kalgoorlie Production Centre: Material
movement at KCGM increased 10% to
66Mtpa (vs FY26 target of 80-100Mtpa). This
material movement is critical to the long-term
development of our largest and longest life asset
in KCGM;
• Yandal Production Centre: During FY22 the
Thunderbox mill expansion project remained on
track and within budget; and
• Pogo Production Centre: The Mill expansion was
completed, mine ramp-up is progressing with
additional stope mining fronts coming online.
The enlarged Northern Star
portfolio has achieved a
positive step change in safety
performance along with
meeting FY22 production
and cost guidance. This has
occurred in a year that has
seen extraordinary challenges,
not only for Northern Star but
the industry as a whole, and is
testament to our hardworking
teams.
Table 1 Mine Operations Review
Metrics4
Jundee Thunderbox
KCGM
Kalgoorlie
(ex KCGM)
Carosue
Dam
Pogo
Total
17
Total Material
Mined (tonnes)
Total Material
Milled (tonnes)
Head Grade
(gpt)
Recovery (%)
Gold Recovered
(Oz)
Gold Sold - Pre-
Production (Oz)
Gold Sold –
Production (Oz)
3,644,865
4,099,528
8,834,385
2,300,810
4,486,256
1,002,707
24,368,551
2,714,898
3,055,859
13,358,831
2,336,085
3,780,584
1,046,414
26,292,672
3.9
91
1.5
92
1.4
84
2.6
89
2.1
93
7.4
86
2.15
885
310,225
132,502
486,001
171,027
237,625
215,671
1,553,051
-
23,893
6,052
-
-
-
29,945
310,823
108,658
482,718
174,918
239,681
214,216
1,531,013
Gold Sold (Oz)
310,823
132,551
488,770
174,918
239,681
214,216
1,560,958
All-in Sustaining
Cost (A$/Oz)6
1,295
1,817
1,426
1,949
1,785
2,068
1,6335
4. EKJV, Kundana and Carbine asset data is only included up and until the point of sale – 18 August 2021. For more information, please see
https://www.nsrltd.com/investor-and-media/asx-announcements/2021/august/kundana-asset-sale-completes.
5. Represents the average total for FY22.
6.
Pogo all-in sustaining cost has been presented in AUD which is the Group’s presentation currency. The AISC in United States Dollars was US$1,498 for the
financial year.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Pogo Production Centre
Pogo Operations
+6.4Moz Gold Camp
0.5
FY22 LTIFr
2.2
FY22 TrIFr
Fairbanks
Steese National
Conservation Area
Pogo
North
Pole
Delta Junction
7,338koz
Mineral resources
(up 431koz)
1,808koz
Ore reserves
(up 310koz)
(at 31 March 2022)
Denali National
Park and Preserve
Lake Clarke
National Park
and Preserve
Production
ANCHORAGE
FY22 performance at Pogo consistently improved
quarter on quarter. Gold sold at Pogo totalled
214,216oz which exceeded our FY21 result of
204,041oz. AISC was US$1498/oz (FY21 result
US$1,387/oz), with Q4 improved performance and
consistency, delivering significantly lower costs
when compared to FY22 earlier quarters with
reductions in underground mining costs of 25%
and processing costs of 13%. This resulted in overall
FY22 mine operating cash flow of US$63M, net
mine cash flow at US$8M after growth capital of
US$55M.
exploration
Pogo Mine achieved a 20% increase in Ore
Reserves to 1.8Moz at an increased grade of 8.5g/t,
highlighting the exceptional geological potential
of the Pogo system. In-mine drilling activity at
Pogo continued to be challenged by the impact of
COVID-19 and labour availability.
A resource definition drilling program was completed
at the Goodpaster project with considerable success
on a portion of the Goodpaster trend. The program
delivered a maiden underground Inferred Mineral
Resource estimate, based on 214 diamond drill holes,
of 3.2Mt @ 10.3g/t for 1.1Moz of gold.
18
Underground scaling activities,
Pogo Operations, Alaska, USA
Kalgoorlie Production Centre
Kalgoorlie Operations
KCGM Operations
+15Moz Gold Camp
+80.9Moz Gold Camp
• Kanowna Belle
• Kundana
• East Kundana JV (51%)
• South Kalgoorlie Operations
Carosue Dam Operations
+4.9Moz Gold Camp
Lake Rebecca
Carosue Dam
Kanowna
Belle
KALGOORLIE
KCGM
Kundana
East Kundana
JV (51%)
Mount Burges
Coolgardie
South Kalgoorlie Operations
Lake Lefroy
Kambalda
19
37,135koz
Mineral resources
(up 2,065koz, less divestment
2,443koz)
14,947koz
Ore reserves
up 563koz, less divestment
579koz) (at 31 March 2022)
0.5
FY22 LTIFr
2.2
FY22 TrIFr
KCGM Operations
The revitalisation made possible under one
owner has continued to strengthen the KCGM
Operations. FY22 saw production in the open
pit increase by 10% to 66Mt (FY21: 60Mt). This
increase was achieved by focused mine planning
and execution while also completing the open
pit fleet replacement program. The significant
investment in the new fleet saw 39 new 793F
class trucks commissioned, allowing the older
trucks, which are now 20 years old, to be retired.
Production
Production at KCGM remained strong in FY22.
Total gold sold in FY22 was 488,770oz which was
higher than the previous year (FY21: 472,089oz
at 100% interest). FY22 AISC was A$1,426/oz
(FY21 $1,385/0z). A potential mill expansion options
pre-feasibility study was released in Q4 of FY22
outlining a number of pathways to increase growth
in gold production going forward.
exploration
In FY22 exploration activity expanded across
the KCGM Operations as part of a multi-year
growth program announced following the merger.
Beneath the surface mining operations at Fimiston
South, Brownhill and Morrisons we undertook
significant surface resource definition programs
and established a new underground access in the
Fimiston North area. Drilling from the open pit
and the new underground platform increased the
Fimiston Underground Mineral Resource by 20% to
65Mt @ 2.3g/t for 5.0Moz. The Mount Charlotte
underground operation grew in Reserves to 1.2Moz.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
20
result.
Overall, Kalgoorlie Operations delivered lower
production of 2,336,085 tonnes in FY22 (FY21:
2,837,351t) with the reduction mainly attributed
to the sale of the Kundana assets8. The lower
production naturally resulted in a reduction in total
gold sold in FY22 of 174,918oz (FY21: 256,657oz).
FY22 AISC was A$1,949/oz (FY21: A$1,942/oz).
exploration – South Kalgoorlie
In-mine exploration drilling at SKO has successfully
identified further extensions across the northern
area of the mine, which remains open down plunge.
Drilling programs in the Mutooroo trend north of
the current mining area have returned impressive
high-grade results including 17.9m @ 12.2g/t, 3.9m
@ 26.7g/t and 6.3m @ 12.3g/t. Resource definition
drilling programs across the mine during FY22
resulted in a significant increase in Ore Reserves to
457,000 ounces.
exploration – eKJV, Kundana and Carbine
Limited exploration was undertaken at EKJV,
Kundana and Carbine due to the sale of Northern
Star's interest in these assets which completed on
18 August 2021. For more information, please see
https://www.nsrltd.com/investor-and-media/asx-
announcements/2021/august/kundana-asset-sale-
completes
The Carosue Dam Operations
processed a total 3,780,584
tonnes in FY22, resulting in an
increase from the prior year
(FY21: 3,611,254 tonnes) and
a new processing record for
the site.
Drilling completed at Mt Ferrum returned several
impressive intersections including 11.0m @ 7.2g/t
and 4.1m @ 10.0g/t.
Exploration drilling at Mt Percy and Little Wonder
has targeted potential bulk tonnage stockwork
mineralisation, using “Mt Charlotte-style” drilling
orientations, returning some excellent results. This
initial exploration drilling has driven a 100% increase
in the Mineral Resource to 17.0Mt @ 1.2g/t for
640,000oz.
Carosue Dam Operations
Production
The Carosue Dam Operations processed a total
3,780,584 tonnes in FY22, resulting in an increase
from the prior year (FY21: 3,611,254 tonnes) and a
new processing record for the site. Total ounces of
gold sold also increased in FY22 to 239,681oz (FY21:
232,276oz). FY22 AISC was A$1,785/oz (FY21
A$1,311/oz). Overall, the FY22 results demonstrate
that the Carosue Dam FY21 mill expansion has been
a sound investment and continues to operate well
above the design nameplate of 3.2Mtpa.
exploration
A focus for exploration drilling during the year was
the Qena prospect, with programs successfully
outlining a zone of continuous gold mineralisation
along the steeply dipping eastern contact of the
Atbara monzonite intrusion. This exploration
drilling program generated a maiden open pit and
underground Mineral Resource totalling 4.3Mt
@ 2.2g/t for 310,000oz that remains open in all
directions.
Kalgoorlie Operations7
Production
In FY22 Kalgoorlie Operations sourced ore primarily
from the Kanowna Belle and HBJ underground
mines. In Q4 South Kalgoorlie experienced a larger
than expected mill downtime event impacting
available milling time at South Kalgoorlie. The
Jubilee mill was placed on care & maintenance
in the September 2022 quarter - highlighting the
flexibility within Northern Star’s portfolio to deliver
optimal business outcomes - with ore feed directed
to Kanowna Belle and KCGM. While these decisions
are difficult and reduce processing capacity in the
region from 20Mtpa to 19Mtpa, it does highlight the
strength of the integrated business to optimise gold
production in order to realise a superior financial
7. Excludes KCGM and Carosue Dam. EKJV, Kundana and Carbine asset data is only included up and until the point of sale – 18 August 2021.
8. For more information, please see ASX announcement on our website at https://www.nsrltd.com/investor-and-media/asx-announcements/2021/august/
kundana-asset-sale-completes.
Yandal Production Centre
Jundee
Meekatharra
Wiluna
Bronzewing
Wanjarri
Nature
Reserve
Leinster
Thunderbox
Jundee Operations
+10.8Moz Gold Camp
Bronzewing Operations
Leonora
+3.6Moz Gold Camp
Thunderbox Operations
+4.5Moz Gold Camp
0.5
FY22 LTIFr
2.1
FY22 TrIFr
9,793koz
Mineral resources
(down 324koz)
3,887koz
Ore reserves
(down 602koz)
(at 31 March 2022)
Production
Yandal Production Centre had a strong FY22 with a
combined mill throughput of 5,770,757 tonnes and
total gold sold was 443,374oz at AISC A$1,430/oz.
Mine operating cash flow was A$414 million. Net
mine cash flow was A$137 million after net growth
capital of A$277 million.
Jundee and our satellite mines of Julius and Ramone,
had a strong year which was highlighted by high grade
ore stoping areas being mined for a new record gold
sold under Northern Star ownership of 311koz. It was
an outstanding result for an asset that continues to be
a benchmark for how large narrow vein gold mines
operate worldwide. Processing milled 2,714,898 ore
tonnes in FY22 (FY21: 2,493,606t). Total gold sold in
FY22 was 310,823oz (FY21: 286,676oz). FY22 AISC
was A$1,295/oz (FY21: A$1,278/oz).
FY22 results at Thunderbox improved milled tonnes
to 3,055,859 tonnes (FY21: 2,929,566t). Gold sales
for FY22 decreased to 132,551oz (FY21: 143,990oz).
FY22 AISC was A$1,817/oz (FY21: A$924/oz). The
reduction in gold sales was expected because of
lower grade ore availability compared to FY21 and was
in line with plan. Throughout FY22 key infrastructure
developments were installed at Thunderbox to
increase capacity of the Thunderbox mill operations
from 3Mtpa to 6Mtpa, due to be completed in Q2
FY23. It is a credit to the construction team for the
project to so far remain on time and on budget despite
COVID-19 and a construction boom in the mining
industry.
Other advancements for the Yandal Production Centre
included the Julius open pit successfully and safely
reaching the bottom of the stage one shell, with
high-grade ore mined throughout FY22. At Ramone
the development of the underground mine is ahead of
schedule.
exploration – Jundee Operations
During FY22, exploration across Jundee continued
in several areas. Surface exploration was focused
on the near surface opportunities in the northern
mine area, targeting extensions to the Cook, Keating
and Griffin lodes. From underground, exploration
drilling focused on near mine opportunities south
of the McLarty granodiorite and extensions to key
mineralised structures such as Barton and Gateway.
Exploration results were hampered by slow assay
turnaround and significant assay backlogs.
exploration – Bronzewing Operations
Resource definition drilling on the central Corboys
prospect, approximately 25km north of Bronzewing,
has continued to extend the mineralisation along the
prospective granite-basalt contact. This highlights
the along strike potential of the Corboys – Mt Joel
trend for future discoveries.
exploration – Thunderbox Operations
In FY22 exploration on the Wonder Shear Zone
continued. Collection of higher resolution
geophysical data improved the definition and
positioning of the Wonder Shear Zone to the south-
east. This definition combined with systematic
drill testing resulted in the discovery at the
Golden Wonder prospect. This significant gold
mineralisation is characterised by strong alteration
hosted within a highly strained monzogranite.
21
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Exploration at Bannockburn focused on drill-testing
the Bannockburn Shear Zone to the north of the
current defined Mineral Resource and Ore Reserve.
conditions to achieve several highly encouraging
results located 500m north of the current
Bannockburn Ore Reserve.
Previously, exploration north of Bannockburn has
been hampered by the presence of thick surface
and paleo drainage channels. The current drilling
program successfully negotiated the difficult drilling
Strong primary mineralisation was located by
broad-spaced drilling of structures propagating off
the Bannockburn Shear Zone in a similar geological
setting to the Bannockburn open pit to the south.
Tanami Project
Tanami Project
+5Moz Gold Camp
Halls
Creek
Fitzroy
Crossing
22
Gibson
Desert
North
Tanami
Alice Springs
0
FY22 LTIFr
0
FY22 TrIFr
1,895koz
Mineral resources (523koz divested)
(at 31 March 2022)
Central Tanami (NST 50%)
As announced to the ASX on 16 September 2021,
Northern Star acquired a further 10% interest in the
Central Tanami Project, increasing its stake to 50%.
A new joint venture has been formed, with a jointly
owned joint venture management company being
established, through which both Tanami Gold NL
(ASX: TAM) and Northern Star are jointly funding all
exploration and development activities. Exploration
drilling is being advanced and a scoping study is
in progress to determine next steps for project
development. For more information, please see
https://www.nsrltd.com/investor-and-media/asx-
announcements/2021/september/completion-of-
central-tanami-project-jv
Western Tanami (NST 100%)
There was limited activity at Western Tanami in
FY22, due to the sale of the Western Tanami Project
which completed on 15 June 2022. For more
information, please see https://www.nsrltd.com/
investor-and-media/asx-announcements/2022/
june/northern-star-completes-paulsens-and-
western-tanam
Tanami regional (NST 100%)
To complement our existing activities at the Central
Tanami Project Joint Venture, Northern Star holds a
substantial land position in the surrounding Tanami
region. In FY22, the focus was on completing
reconnaissance aircore drilling programs at select
locations across the project area, though was limited
by COVID-19 restrictions.
To complement our existing activities at the Central Tanami
Project Joint Venture, Northern Star holds a substantial land
position in the surrounding Tanami region.
Paulsens Operations
Paulsens
+3Moz Gold Camp
Indian Ocean
Karratha
Onslow
Fortescue River
Cane River
Conservation Park
Nanutarra
Paulsens
0
FY22 LTIFr
231koz
Mineral resources
(divested)
0
FY22 TrIFr
42koz
Ore reserves (at 31 March 2022)
(divested)
The sale of Northern Star's Paulsens Operations
completed on 15 June 2022. For more information,
please see https://www.nsrltd.com/investor-and-
media/asx-announcements/2022/june/northern-
star-completes-paulsens-and-western-tanam
23
Section of open pit face
at Jundee Operations,
Yandal Production Centre,
Western Australia
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Financial review
Record revenue for the year of $3.7 billion and strong
balance sheet maintained to support our profitable
growth strategy. Key financial outcomes from our
FY22 operations are highlighted below.
Clear organic growth pathway
The first year of our five-year profitable growth
strategy to 2Mozpa production by FY26 delivered
significant progress:
• Kalgoorlie – KCGM material movement of
66Mtpa;
• Yandal – Thunderbox mill expansion remains on
track and within budget; and
• Pogo – Mill expansion completed.
The Company’s robust balance sheet and available
liquidity supports this organic growth strategy,
details of which are outlined on pages 32 to 35.
At 30 June 2022, the Company had cash and
bullion of $628 million.
robust returns to shareholders
A final fully franked dividend of 11.5 cents per share
to shareholders has been approved, taking the full
year payout to 21.5 cents per share.
Strong operational and free cash
generation
As a result of the strong production and gold price
realised during the year, the Company generated
record underlying EBITDA of $1.5 billion (FY21: $1.2
billion) primarily driven by a 29 percent increase
in gold sold (excluding preproduction ounces)
(FY22: 1,531,013 ounces; FY21: 1,182,946 ounces).
Similarly, operating cash flow was up 49 percent
from the prior year to $1.6 billion (FY21 $1.1 billion)
and underlying free cash flow was up 33 percent to
$477 million (FY21: $359 million).
Growth in Cash earnings9
Cash Earnings increased 58 percent to $1.0 billion,
reflecting the cash-generating strength of the
business.
&
Margin focus
Gold revenue increased 35 percent to $3.7 billion
primarily driven by the 29 percent increase in
gold sold (excluding preproduction ounces) and a
7 percent increase in average realised gold price to
$2,433 per ounce (FY21: $2,273 per ounce). Cost
of sales increased 45 percent to $3.2 billion (FY21:
$2.2 billion) driven by higher activity across all
operations translating to higher mining, processing,
operational employee costs and depreciation and
amortisation expenses. Costs continue to remain
a strong focus for the business and has been a key
element of the Company’s strategy to unlock value.
Northern Star has an excellent history of realising
total cost reductions and best in class operational
productivity.
"
Figure 1 Cash flow from Operations (A$M)
Figure 2 Cash Earnings (A$M)
24
49%
9
9
5
,
1
$
7
7
0
,
1
$
1
2
Y
F
2
2
Y
F
58%
2
2
0
,
1
$
8
4
6
$
1
2
Y
F
2
2
Y
F
9. Cash Earnings is Underlying EBITDA less net interest, tax paid and sustaining capital. Underlying EBITDA adjusts for mergers and acquisition and one-off
charges. These are non-GAAP measures and have been reconciled within the Financial Review section of the Operating and Financial Review.
25
Gold bars poured at
Jundee Gold Mine,
Yandal Production Centre.
Western Australia
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Overview
FY22 performance was generated from the Jundee,
Kalgoorlie Operations, KCGM, Thunderbox, Carosue
Dam and Pogo Operations for the full year ended
30 June 2022.
Figure 3 Gold Sold (oz)10
Figure 4 Revenue (A$M)
Figure 5 Underlying EBITDA
(A$M)
3
1
0
,
1
3
5
,
1
,
6
4
9
2
8
1
,
1
29%
5
3
7
,
3
$
1
6
7
,
2
$
35%
7
1
5
,
1
$
9
5
1
,
1
$
31%
Table 3 Financial Overview
Revenue
EBITDA16
Underlying EBITDA16
Cash Earnings16
Net Profit After Tax 16
FY22
FY21
Change
(%)
A$M
3,735.4
2,760.5
35%
A$M
1,741.0
2,268.0
(23%)
A$M
1,517.3
1,159.2
31%
A$M
1,021.9
647.9
58%
A$M
429.8
1,032.5
(58%)
Cash flow from Operating Activities
A$M
1,599.2
1,076.8
49%
1
2
Y
F
2
2
Y
F
1
2
Y
F
2
2
Y
F
1
2
Y
F
2
2
Y
F
Cash flow used in Investing Activities
A$M
(881.3)
(257.1)
243%
The Company generated record operating cash flow of
$1.6 billion (FY21: $1.1 billion) primarily driven by a 29 percent
increase in gold sold and a 7 percent increase in average realised
gold price per ounce to $2,433 per ounce.
26
Table 2 FY22 Financial Reporting Metrics11 by Operation
Jundee Thunder-
KCGM
box
Kal.
Ops
Carosue
Dam
Pogo
Exp-
loration
Other12
Total
Payments for mine properties and property plant and equipment
A$M
(908.0)
(547.6)
66%
Exploration
A$M
(120.7)
(145.5)
(17%)
Acquisition of Assets & Businesses
A$M
303.9
390.6
(22%)
Net Investment Proceeds / (Payments)
A$M
(168.7)
30.4
(655%)
Other
Free Cash Flow17
A$M
12.2
15.0
(19%)
27
A$M
717.9
819.7
(12%)
Gold Sold -
Production (Oz) 10
310,823
108,658
482,718
174,918
239,681
214,216
Revenue (A$M)
755.7
266.7
1,179.3
425.0
581.4
522.8
-
-
(1)
1,531,013
Underlying Free Cash Flow18
A$M
477.1
358.5
40%
4.513
3,735.4
Cash and bullion
A$M
628.3
799.0
(21%)
Cost of Sales
(Ex-D&A) (A$M)
Depreciation &
Amortisation (A$M)
Impairment (A$M)
Acquisition &
Integration Costs
(A$M)
Segment EBITDA
(A$M)14
Underlying
EBITDA (A$M)14
302.4
137.2
739.0
258.7
322.8
356.5
12.1
(12.1)
2,116.6
Corporate Bank Debt & Secured Asset Financing19
A$M
368.2
746.2
(51%)
123.5
117.0
356.3
94.8
276.9
130.9
1.9
9.2
1,110.5
Basic Earnings Per Share
Cents
37.0
114.7
(68%)
-
-
-
-
-
-
-
-
-
-
-
-
52.4
-
52.4
-
7.4
7.4
453.3
129.6
440.3
166.3
258.6
166.3
(12.1)
NA
1,602.2
453.3
129.6
440.3
166.3
258.6
166.3
(12.1)
(85)15
1,517.3
Dividends per share20
Cents
21.5
19.0
13%
16. Net Profit After Tax is statutory profit (NPAT). EBITDA, Underlying EBITDA and Cash Earnings are non-GAAP measures and have been reconciled to NPAT
in Table 4 overpage.
17. Free Cash Flow is calculated as operating cash flow less investing cash flow as outlined in the Group’s Cash Flow Statement
18. A reconciliation between free cash flow and underlying free cash flow has been included in Table 5 overpage.
19. Excludes accrued interest and net of unamortised upfront transaction costs
20. This excludes the Special Dividend of 10 cents per share paid during FY21
10. Gold Sold excludes gold sales from assets not currently determined to be in commercial production (operating in the manner as intended by management
as defined by Australian Accounting Standards). During the financial year 30koz (FY21: 56koz) of pre-production sales were capitalised to Mine Properties
offset against the related growth capital. Total development receipts capitalised to Mine Properties during the financial year were $73.2 million.
11. The metrics in this table have been prepared on a financial reporting basis. References to FY21 incorporate the effects of the merger with Saracen from 12
February 2021.
12. Other contains amounts not allocated to segments, including corporate activities.
13. Other revenue is the non-cash unwind of the acquired out-of-the-money hedge book contract on merger that has not been allocated to operations. The
liability unwinds to revenue as the out-of-the-money hedges are delivered.
14. Segment and Underlying EBITDA are non-GAAP measures and have been reconciled in note 2 of the financial statements and below, respectively.
15. Includes: corporate costs, excluding exploration segment EBITDA and corporate, technical services and projects depreciation and amortisation.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Table 4 Net Profit After Tax to EBITDA, Underlying EBITDA and Cash Earnings Reconciliation
Income Statement
The results and commentary below relate to the 12
months ended 30 June 2022, which included a full
year and performance in respect of the operations
and assets acquired from the merger with Saracen.
As the merger completed 12 February 2021, the
comparative 12 month period ended 30 June 2021
includes only a part contribution of the assets
acquired and their performance.
The Group reported a statutory profit after tax of
$430 million for the 12 months ended 30 June
2022, a 58 percent decrease from the prior year
(2021: $1,033 million). This reduction in statutory
profit after tax was largely due to the prior year
recognising non-cash gains and losses arising from
the merger, including a $1.9 billion gain in respect
of the remeasurement of the Company’s interest in
KCGM which was offset by $437M of impairment
charges relating to low grade ore stockpiles and
$232M of acquisition and integration costs.
The Group reported Cash Earnings for the period
ended 30 June 2022 of $1.02 billion which is 58
percent higher than the prior year (FY21: $648M).
Cash Earnings is defined as underlying EBITDA
less net interest paid, tax paid and sustaining
capital. As a result of merger accounting and the
Company’s focus to generate superior returns, Cash
Earnings provides shareholders with an improved
understanding of the Company’s performance as it
reflects sustaining free cash flow.
Production increased across all operations
compared to the prior year, with the only exception
being Kalgoorlie Operations where production
28
decreased due to the divestment of the Kundana
operations in August 2021. The main driver for
the higher production for the year ended 30 June
2022 was the 12 months of production contribution
from Thunderbox, Carosue Dam and the additional
50 percent of KCGM operations which were
acquired from the merger.
Cost of sales increased 48 percent to $3.2 billion
(2021: $2.2 billion) driven by higher activity across all
operations translating to higher mining, processing
and operational employee costs and an increase in
non-cash depreciation and amortisation charges and
inventory expenses which were incurred from the
higher asset values recognised on the balance sheet
as part of the merger.
Non-cash impairments of $52 million (2021:
$546 million) were recognised with the current
year impairment being in respect of exploration
properties.
Consistent with the strategy of active portfolio
management, the Group divested its interest in
Paulsens, Western Tanami and Kundana assets
during the year resulting in total pre-tax gain of $298
million. These properties were non-core to Northern
Star’s five-year strategic plan. Paulsens and Western
Tanami were on care and maintenance at the time of
the sale.
Net Profit After Tax
Tax
Depreciation & Amortisation
Interest Income
Finance Costs
EBITDA
Financial Instrument Fair Value Adjustments
Impairment Charges
Pre-tax gain on remeasurement of KCGM (NST 50% share)
Acquisition & Integration Costs
Merger fair value uplift on run-of-mine stockpiles and
gold-in-circuit 21
Loss on extinguishment of KCGM power contract
Delivery of Saracen non-cash hedge book 22
Gain on Disposal of Subsidiary and assets
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
A$M
FY22
FY21
429.8
1,032.5
180.3
551.4
1,110.5
660.0
(6.0)
26.4
(4.3)
28.4
1,741.0
2,268.0
(0.8)
52.4
-
7.4
-
19.4
(4.5)
(297.9)
18.9
545.6
(1,919.2)
231.8
74.0
-
(59.9)
-
-
29
Loss on disposal of property, plant and equipment
A$M
0.3
Underlying EBITDA
Tax & Net Interest Paid
Sustaining Capital
Cash Earnings
A$M
A$M
A$M
A$M
1,517.3
1,159.2
(83.4)
(155.0)
(412.0)
(356.3)
1,021.9
647.9
Pogo Operations, Alaska USA
21. Run-of-mine (ROM) stockpiles and gold-in-circuit inventory at the time of the merger was required to be remeasured to fair value, resulting in a non-cash
increase of A$74 million. This adjustment represents the non-cash amount expensed in FY21 on sale of the contained gold.
22. The mark-to-market position on Saracen’s hedge book was required to be recognised as a liability as part of the merger accounting. As the gold in those
hedge contracts is delivered the liability is unwound and recorded as a non-cash increase to revenue.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Balance sheet
The decrease in current assets as at 30 June 2022
to $1.4 billion ($1.8 billion: 30 June 2021) was
mainly driven by the reduction in cash and cash
equivalents, from the repayment of borrowings
during the year, the finalisation of the FY21 Group
tax return and subsequent refund received and the
completion of the sale of the Kundana Assets on 18
August 2021 which was classified as held for sale
at 30 June 2021.
Non-current assets increased by $286 million
primarily due to:
• the investment of C$154 million (A$169 million)
in a convertible senior unsecured debenture with
Osisko Mining Inc. which is measured at fair
value;
• the US$95 million acquisition of Newmont
Power business with the assets of that business
being classified as plant and equipment and
intangibles;
• mobile fleet investment at KCGM operations;
• Thunderbox mill expansion; and
• continued investments in exploration, sustaining
and growth capital across the operations.
Trade and other payables were higher at 30 June
2022 compared to the prior year, consistent with
increased activity across the operations, however
current liabilities remained consistent against the
prior period (30 June 2022: $777 million; 30 June
2021: $765 million) with the sale of Kundana assets
and divestment of the associated liabilities held for
sale during the year. Non-current liabilities reduced
$366 million from the repayment of borrowings
during the year and higher discount rates used to
present value long term closure liabilities.
30
Gold nugget from Kanowna
Belle, Kalgoorlie Production
Centre, Western Australia
Cash flow
Figure 6 Underlying Free Cash Flow (A$M)
Cash flows from operating activities for the 12
months ended 30 June 2022 were $1,599 million,
being 49 percent higher than the previous financial
year driven principally by increased revenues from
higher gold sold and a 7 percent increase in realised
gold price per ounce received for the year. Whilst
payments to suppliers and employees have increased
with higher operational activity and from price
increases for some input costs, additional revenues
from production growth and higher realised prices
have ensured margins remained healthy during the
year ended 30 June 2022. Finally, during the year,
the Company was refunded the $166M payment
made in respect of the FY21 income tax year.
Payments for property, plant and equipment
increased by $214 million, mainly driven by the
Thunderbox mill expansion project. Investment in
exploration remained consistent with the prior year at
$121 million. Payments for mine properties increased
42 percent from the prior year to $498 million with
continued capital invested in mine development
across all operations, with the largest investment
being from the pre-stripping activities at Fimiston
South and Oroya Brownhill at KCGM operations.
$600
$500
$400
$300
$200
$100
$0
7
7
4
$
5
6
3
$
9
5
3
$
9
7
1
$
8
1
Y
F
9
2
1
$
9
1
Y
F
0
2
Y
F
1
2
Y
F
2
2
Y
F
maturity date of 1 December, 2025. The Company
received $402 million in proceeds from the sale of
its Kundana Assets to Evolution Mining Limited in
August 2021.
Cash flows from financing activities highlight was the
net reduction of the Group’s debt facilities during the
year by $562 million. Equipment financing payments
increased FY22 with the investment in the mobile
fleet at KCGM operations.
As mentioned above, in December 2021 the
Company entered into a convertible funding
arrangement with Osisko Mining Inc. to the value of
C$154 million (A$169 million). The Debenture has a
Dividends paid to the Company’s shareholders
during the year ($227 million) included the FY22
interim dividend ($116 million) paid on 29 March
2022.
31
Table 5 Free Cash Flow
Free Cash Flow
Mergers and acquisitions23
Net sale of Investments
Osisko Mining Inc. Debenture
Payments for asset acquisitions
Proceeds from disposal of asset
Proceeds from sale of financial assets at fair value through other comprehensive
income
Movement in bullion awaiting settlement & finished goods
Working capital movement
Payments for equipment financing & leases for operating assets
Underlying Free Cash Flow
FY22
717.9
4.6
(303.9)
168.7
15.0
(16.8)
(10.4)
30.2
-
(128.2)
477.1
FY21
819.7
(318.1)
(30.4)
-
-
-
-
(48.2)
16.4
(80.9)
358.5
23. Mergers and acquisitions includes: 30 June 2022 – Stamp duty on acquisitions ($4.6 million); 30 June 2021- Saracen cash obtained on merger ($402.5
million) less acquisitions of assets during the period ($11.9 million) and merger and acquisition related costs paid ($72.5 million).
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Business Strategies
& Future Prospects
Our Purpose is: To generate superior returns for our
shareholders, while providing positive benefits for our
stakeholders, through operational effectiveness, exploration
and active portfolio management.
Growth strategy
Northern Star announced its five-year strategic
plan in July 202124, to generate superior returns by
executing on an organic growth pathway to 2Mozpa
by FY26, across its three large-scale production
centres all in world class jurisdictions. This “business
first” strategy is underpinned by a commitment to
the following principles (see Figure 7).
32
The first year of the profitable growth pathway
delivered significant progress:25
• Kalgoorlie – material movement at KCGM of
66Mtpa (targeting 80-100Mtpa by FY26);
• Yandal – Thunderbox mill expansion 3Mtpa to
6Mtpa remains on track and within budget, ramp
up expected H1 FY23;
• Pogo – Mill expansion completed, mine ramp-up
The Company’s robust balance sheet and available
liquidity supports this organic growth strategy, with
a cash and bullion balance of $628 million at 30
June 2022.
Figure 7 Strategic plan principles
Generate superior returns
Responsible producer
Profitable growth
Strong cash flow generation
progressing with additional mining fronts.
World-class assets
Figure 8 Progress against five-year strategic plan as at start of FY23
FY22
1.56Moz
FY23
1.56-1.68Moz
FY24
FY25
FY26
Sustainable
Business
Kalgoorlie
KCGM Fleet
Delivery
Increase KCGM material movement to
80-100Mtpa Fimiston South ramp up;
Increased access to Golden Pike
1,100koz
KCGM 650koz
3-5
Production Centres
Yandal
Pogo
TBO Mill
Expansion
(to 6.0Mtpa)
TBO Mill
Commissioning
(to 6.0Mtpa)
600koz
9Mtpa milling (3Mtpa Jundee, 6Mtpa TBO)
Regional processing savings from various ore sources
Mill Expansion
(to 1.3Mtpa)
Increase
production
volumes
300koz
Development ~1,500m per month
Mining = Milling + 1.3Mtpa
1.8-2.2Moz
Gold Sold
1st Half
Cost Curve
+20yr
Life of Mine
24. See ASX announcement: https://www.nsrltd.com/investor-and-media/asx-announcements/2021/july/2021-investor-day-presentation.
25. See ASX announcement: https://www.nsrltd.com/investor-and-media/asx-announcements/2022/august/investor-presentation-diggers-dealers-2022.
Decarbonisation strategy
As a responsible producer, a key aspect of our
business plan is our Net Zero Ambition for Scope 1
and Scope 2 Emissions by 2050, and targeted 35%
reduction in absolute Scope 1 and Scope 2
Emissions by 2030, relative to 1 July 2020 baseline
(931ktCO2-e).
Below is our current planned Emissions Reduction
strategy, including KCGM utilising up to 60%
renewable power.
Figure 9 2030 Scope 1 and Scope 2 Emissions Reduction pathway planned projects26
1,000,000
TBO Expansion
)
e
-
2
O
C
T
(
s
n
o
i
s
s
i
m
E
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
2030
Emissions
Reduction
Target
2022
Yandal
Pogo
Kalgoorlie
2030
33
26. References to carbon emissions are for Scope 1 and Scope 2 Emissions only.
Technician carrying out an inspection
of the solar panels, Carosue Dam,
Kalgoorlie Production Centre,
Western Australia.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
FY23 plans
In FY23, Northern Star is committed to safely
delivering our operational targets and responsibly
advancing its strategic growth options across our
portfolio to maximise returns to shareholders.
The Company will continue to adopt an agile and
disciplined approach to portfolio optimisation.
Northern Star’s financial position remains strong,
with cash and bullion of $628 million. The
Company’s FY23 growth program is fully funded
and aligns with our capital management framework
of allocating capital to those projects that deliver
Table 6 Growth projects planned for FY23
superior returns. Major growth areas, which
accounts for ~90% of the FY23 growth capital
expenditure, are set out in Table 6 below.
We continue our focus on producing profitable
ounces from world-class gold assets in tier- 1
locations. Combined with our differentiated
operating capability that delivers industry-leading
underground productivity rates - the NSMS internal
mining services business – Northern Star is well
positioned to deliver a successful FY23.
% Group
CAPEX
Production
Centre
43%
Kalgoorlie
12%
Yandal
Major growth options
Progressing waste material movement at KCGM, to unlock high grade Golden
Pike North and Fimiston South ore for processing in subsequent years; new
tailings dam
Completion of the Thunderbox mill expansion which is on track and on budget
for commissioning and ramp up in H1 FY23; establishment of Otto Bore mine;
new tailings dam
12%
Yandal
Development of Orelia open pit as a feed source for the expanded Thunderbox
mill
34
10%
Kalgoorlie
Development of Carosue Dam Porphyry underground, scheduled to commence
in H1 FY23
10%
Pogo
Pogo underground mine development; additional camp; underground capital
drilling and assays
FY24-26 outlook
Northern Star’s assets are well placed to deliver
our profitable growth strategy to 2Mozpa by FY26.
The Company is focused on the disciplined and
transparent allocation of capital, and will not grow
for growth’s sake. Northern Star will continue
to review and optimise our portfolio for greater
financial and shareholder returns, in line with our
stated Purpose.
Challenges
The Company is exposed to a range of material
business risks that have the potential to impact
on the execution of our business plan and
growth strategy, and achievement of our stated
performance targets – such as uncertainty in the
operating and inflationary environment triggering
industry-wide cost escalation to accelerate. These
may affect the future financial performance and
position of the Company.
We have disclosed strategic risks to which Northern
Star has an exposure, potential adverse impacts of
those risks, and examples of key control measures in
place – see Table 7. Also included in the next section
is a discussion on the Company’s risk management
processes, including specific disclosures around
climate-related risks and cyber security risks.
35
Exploration core sample inspections,
Kanowna Belle, Kalgoorlie Production
Centre, Western Australia
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
risk Management
Effective risk management helps us make diligent and
defensible decisions as we pursue our growth strategy,
whilst keeping our people safe, and generating value for our
shareholders and stakeholders in a sustainable way.
Northern Star is committed to enhancing the
identification and management of material
risks presented by our operational and
corporate activities. We understand that risk is an
inherent part of operating our business and believe
in building a safer and more sustainable business
for our employees, contractors, shareholders and
stakeholders.
36
A crucial element underpinning Northern Star’s risk
management is our Company culture. Our Company
culture is guided by our Code of Conduct and
STARR Core Values that promote a positive culture
requiring transparency, honesty, integrity, ethical
behaviour and accountability.
Our operational and corporate activities are guided
by Northern Star’s risk management framework,
comprising a risk management policy and standard.
The framework is aligned to ISO 31000, the
international standard for risk management, and
provides a consistent approach to the assessment,
management and reporting of strategic, operational,
financial, environmental, social performance,
governance and other business risks across the
organisation. The framework is overseen by the
Board, who have a significant understanding of
material risks in the industry and jurisdictions in
which Northern Star operates. The framework also
supports executive management and the Board in
meeting their corporate governance responsibilities.
In FY22, to complement the Company’s existing
internal audit framework, a Group-level in-house
audit and risk function was established. A Group
Manager Audit & Risk was appointed. This role has
a direct line to the Audit & Risk Chair. In addition
to overseeing the internal auditor function, this role
aims to enhance and improve Northern Star’s risk
management capability and maturity, in support of
the Company’s corporate governance.
Four of the Company’s independent Directors, who
possess the required expertise and a suitable mix
of skills and diversity of experience, form the Audit
& Risk Committee and make recommendations
to the Board on the risk management framework.
Our senior management team is responsible
for reinforcing and modelling the appropriate
behaviours and judgements required to maintain
effective risk management and risk awareness,
supported by the Audit & Risk function. At meetings
of the Audit & Risk Committee, information
regarding emerging and existing business risks is
presented by management and internal audit for
challenge and discussion. This risk management
framework enables the Board to identify further
areas to mitigate risks and continuously monitor and
improve risk management and internal controls.
In FY22, examples of this risk management
framework in action included:
• Company-wide strategic and operational risk
reviews;
• environmental and social performance risk
reviews and a separate climate-change related
change risk review;
• crisis management and business continuity
training drills;
• a comprehensive review of our insurance
framework and policies;
• a rigorous annual budgeting system based on up-
to-date Resources and Reserves information;
• appropriate due diligence and advisory expertise
for acquisitions and divestments; and
• scrutiny of management’s capital allocation
decisions for organic and inorganic growth
initiatives by the Exploration & Growth
Committee in pursuit of the Board’s role in
approving and monitoring performance of the
Company’s strategy.
The Company’s strategic risks, and key examples
of control measures are summarised in Table 7 on
page 38. This includes the key environmental27 and
social28 risks to which the Company has a material
exposure that are likely to affect Northern Star’s
financial condition or operating performance29.
27. As defined in the ASX Corporate Governance Council Principles and Recommendations (4th Ed.). For example, it includes risks of polluting or degrading
the environment, adding to carbon levels in the atmosphere or threatening a region's cultural heritage.
28. For example, modern slavery risk, mistreating employees or suppliers, harming the local community and risks associated with pandemic.
29. As disclosed in accordance with Recommendation 7.4 in the ASX Corporate Governance Council Principles & Recommendations (4th Ed.).
Climate related risks
Cyber Security risks
As shown in Table 7, Northern Star recognises that
climate change poses a key environmental and
social risk to our business and we are committed
to improving our understanding of climate change
related risks.
To better identify and manage risks relating to
climate change, we continue to conduct bi-annual
climate change risk assessments which are aligned
with the UN Task Force on Climate-Related
Financial Disclosures (TCFD) recommendations.
Results of these climate change risk assessments
are submitted to both the Environmental, Social &
Safety Committee and the Audit & Risk Committee
ensuring Board oversight of the risks and direction
on key measures to be implemented to reduce
these risks, including progress or barriers towards
achieving our announced Net Zero Ambition.
Further information on key environmental and social
performance risks are detailed in our latest FY22
Sustainability Report available on our website at
www.nsrltd.com/sustainability/.
The Company has an Information Technology
Policy, Data Technology Standard, Security
Incident Management Plan, and other information
security policies and procedures in place, and
is regularly audited based on best practices and
information security standards from the Australian
Signals Directorate (ASD) and National Institute of
Standards and Technology (NIST). The Company’s
information security training and compliance
program includes training during onboarding, annual
refresher training, and anti-phishing simulations and
training throughout the year for all employees. This
addresses threat and vulnerability management from
a cyber security perspective.
The Company has experienced no material
information security breaches in the past three
years. The Information Technology Manager and
the Group Manager Audit & Risk regularly briefs the
Board on information security matters at Audit &
Risk Committee meetings.
37
Artist Danielle Champion and
her family, commissioned
to create Northern Star’s
‘Karlkurla’ Truck
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 OPerATING AND FINANCIAL reVIeW
OPerATING AND FINANCIAL reVIeW
Table 7 Strategic risks and key control measures
Risk category
People
Operations
Financial
ESG
Growth
Technology
Category Risk description
Potential adverse impacts
Key control measures examples
Failure to manage safety hazards
• Fatality or serious injury to personnel
Inability to attract & retain skilled personnel
in competitive market
• Capability and capacity dilution in workforce
• Loss of corporate knowledge
• Negative impact on organisational culture
Behaviour & culture tolerating / enabling
psychosocial hazards & harm
Business integrity & ethics breach
• Personnel exposed to toxic culture with negative impact on mental
health, safety & wellbeing
• Bullying, harassment, discrimination, assault
• Flow on impact to local community
• Financial loss, fines, penalties, criminal proceedings
• Loss of social licence to operate
• Reputational damage
Operational underperformance against
targets
• Erosion of shareholder value
• Reputational damage
Supply chain disruption due to adverse
events (COVID-19, natural disasters)
Significant and/or sustained business
disruption (plant failure, attack, fire)
• Production impacts
• Project delays
•
Increased costs
• Production loss
• Financial loss
• Harm to personnel
Prolonged cost escalation (labour, energy,
consumables, equipment, logistics)
• Eroded profitability and shareholder value
• Significant management intervention necessitated
Sustained depressed gold price
• Significant management intervention required (e.g. cancel / delay
major projects, capital reallocation, cost reductions)
Inability to achieve five-year strategic plan
•
38
Failure to meet climate change &
decarbonisation commitments
• Loss of social licence to operate
• Shareholder activism
• Challenges accessing debt markets
Heritage compliance breach
Significant environmental incident
• Destruction of heritage sites of importance
• Suspension of operating licence, fines, litigation
• Loss of social licence to operate
• Damage to flora, fauna, sites of environmental significance
• Adverse impact on ecosystems, biodiversity, water resources
• Suspension of operation licence, fines, litigation
• Loss of social licence to operate
Effects of climate change on operations
(water scarcity, extreme weather, dust)
• Disruption to operations
•
Increased cost of licences, cost of compliance
Damage to community / stakeholder
relations
• Systematic, widespread loss of community trust
• Loss of social licence to operate
Corporate regulatory non-compliance
• Suspension or cancellation of operating licences
• Fines, penalties, enforceable undertakings
• Regulatory scrutiny and increased cost of compliance
• Reputational damage
Delay in or failure to secure land access &
approvals (heritage, environmental, third
party, tenements)
• Delays to accessing new areas
• Constrained mine planning
• Difficulty or delay in obtaining project approvals
Resources & Reserves underperformance
Mergers, acquisitions & divestments
Business disruption and data loss caused by
significant cyber security attack
• Reduced profitability & net cash flows
• Variations to mine plan, reduced mine life
• Erosion of shareholder value
• Erosion of shareholder value
• Employee dissatisfaction and cultural challenges
•
Inefficiencies due to poor integration
• Failure at operations resulting in production loss
• Commercially sensitive or personal data breach
• Financial loss, regulatory or legal action
• Reputational damage
Significant failure of information (IT) &
operational technology (OT) services
• Lost productivity
• Costs of restoring and recovering
• Group Health & Safety Management System (e.g. training, hazard ID, emergency preparedness) applied
• Enhancements to Critical Risk Standards & controls operated to manage fatality risk
• Delivery of competitive remuneration and benefits
• Provision of leadership and talent development programs across the business
• STARR Actions program implemented to address results of latest Culture Survey
Implementation of STARR Actions program to embed desired culture
•
• Code of Conduct and Employee Equal Opportunity Policy (EEOP) enforced to minimise harassment
• Whistleblower Policy enables confidentiality & anonymity of reports to be preserved
• Provision of regular training on, and reinforcement of, the Company’s Code of Conduct & policies
• Undertaking internal & external audits and investigations
• Whistleblower program observed
• Mine planning, reconciliation and grade control plans implemented
• Asset management framework and standards are observed
• Maintaining consistency in technical and operational capability is made a priority
• Regular and early contact with suppliers made to identify and address anticipated delays or suspension in supply
• Emergency management and business continuity planning, including availability of critical spares
• Cost sensitivity analysis conducted as part of budget and forecasting process
• Treasury Risk Management Policy in place and applied
•
Implementation of cost reduction and strategic procurement initiatives
• Price sensitivity analysis conducted as part of budget and forecasting process
• Treasury Risk Management Policy in place and applied
• Net Zero Ambition, and targeted 35% reduction, of absolute Scope 1 and 2 Emissions by 2030 (relative to 1 July 2020
39
baseline of 931ktCO2-e)
• Clear pathway to decarbonisation developed and disclosed, with periodic updates
• Absolute carbon Emissions Reductions KPIs form part of senior leadership team remuneration
• Compliance with heritage management plans
• Meaningful engagement undertaken with Traditional Owners groups
• Group Environmental Management System continuously improved upon and applied
• Continuous monitoring & periodic compliance audits conducted
• Water balance model and water usage forecasting utilised
• Oversight by the Environmental Social & Safety Board sub-Committee
• Meaningful stakeholder engagement and consultation undertaken
• Dedicated Manager Social Performance - Australia appointed
• Group management systems and compliance procedures observed
•
Internal and external audit and risk management processes observed
• Risk assessments & Management Plans implemented
• Ongoing and effective communications with governments and regulatory authorities
• Engagement with Traditional Owners and third parties
• Skilled exploration team and tenement management systems and capabilities
• Exploration budget supports sustained Resources & Reserves growth
• Oversight by the Exploration & Growth Committee of the Board
• Comprehensive due diligence conducted on all M&A activity, including external expert input as needed
• Disciplined M&A decisions are made in line with stated five-year strategy
• Appropriate integration planning and change management is undertaken
• Use of Security Incident and Event Monitoring System
• Business continuity planning
• Regular cyber security training for all employees (including Directors), such as simulated phishing tests
• Offsite disaster recovery ability for critical ICT systems
• Business continuity planning
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 resources
& reserves
reSOUrCeS & reSerVeS
reSOUrCeS & reSerVeS
Mineral resources
Group Mineral Resource remains stable at 56.4Moz, despite
mining depletion and portfolio optimisation, reflecting: growth
of 4.3Moz from exploration success across production
centres; Fimiston Underground Inferred Mineral Resource
increased 1Moz; and reduction of 2.4Moz following divestment
of the Kundana Assets.
Table 1 Mineral Resources as at 31 March 2022
Measured
Indicated
Inferred
Total Resources
Tonnes Grade Ounces
Tonnes Grade Ounces
Tonnes Grade Ounces
Tonnes Grade
Ounces
NST ATTRIBUTABLE INCLUSIVE OF RESERVE
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
KANOWNA GOLD PROJECT
Stockpiles
Gold in Circuit
Sub-Total Kanowna
SKO GOLD PROJECT
Stockpiles
Jubilee ROM stocks
Gold in Circuit
Sub-Total SKO
Surface
10
3.1
1
2,878
2.7
249
3,339
1.3
144
6,227
2.0
393
Underground
4,588
3.3
483
15,652
2.6
1,326
11,274
2.3
827
31,514
2.6
2,636
230
1.6
-
-
12
6
-
-
-
-
-
-
-
-
-
-
-
-
230
1.6
-
-
12
6
4,828
3.2
502
18,530
2.6
1,575
14,613
2.1
971
37,971
2.5
3,047
Surface
-
-
-
-
-
-
-
-
-
-
-
-
Underground
2,591
3.0
251
12,136
3.0
1,183
10,116
3.3
1,058
24,843
3.1
2,492
-
-
208
1.3
-
-
-
8
3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
208
1.3
-
-
-
8
3
2,799
2.9
262
12,136
3.0
1,183
10,116
3.3
1,058
25,051
3.1
2,503
CAROSUE DAM GOLD PROJECT
Surface
3,794
1.6
195
22,687
1.7
1,217
10,467
1.6
522
36,947
1.6
1,934
Underground
7,583
3.0
727
12,685
2.5
1,036
5,977
2.9
473
26,244
2.7
2,235
Measured
Indicated
Inferred
Total Resources
Stockpiles
Gold in Circuit
2,526
1.8
-
-
58
-
-
-
-
-
-
-
-
-
-
-
-
-
2,526
1.8
-
NST ATTRIBUTABLE INCLUSIVE OF RESERVE
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
Total Kalgoorlie Production Centre
144,506
1.0
4,633
334,982
1.9 20,892
195,218
1.8
11,610
674,706
Tonnes Grade Ounces
Tonnes Grade Ounces
Tonnes Grade Ounces
Tonnes Grade
Ounces
Sub-Total Carosue Dam
13,903
2.2
980
35,371
2.0
2,253
16,444
2.1
995
65,718
61
3
21
5
7,376
1.5
355
4,784
1.3
192
14,045
35,478
3.2
3,661
11,885
2.9
1,126
47,408
-
-
-
-
-
-
-
-
-
-
-
-
576
-
1.3
3.1
1.3
-
609
4,791
21
5
90
42,854
2.9
4,017
16,670
2.5
1,319
62,029
2.7
5,425
PAULSENS PROJECT
Stockpiles
Gold in Circuit
Sub-Total Paulsens
ASHBURTON PROJECT
Surface
-
-
Underground
341
5.8
11
-
1.6
-
-
64
1
0
129
3.1
88
5.6
-
-
-
-
13
16
-
-
1,766
1.9
106
1,895
2.0
43
6.6
-
-
-
-
9
-
-
473
5.8
11
-
1.6
-
353
5.7
65
217
4.1
29
1,809
2.0
115
2,379
2.7
209
-
2.1
1.7
58
-
4,227
37,135
119
89
1
0
43
JUNDEE GOLD PROJECT
Surface
1,884
42
Stockpiles
Gold in Circuit
Sub-Total Jundee
THUNDERBOX PROJECT
Stockpiles
Gold in Circuit
Underground
45
576
-
2,506
Surface
2,910
Underground
12,986
1,925
-
1.0
2.1
1.3
-
1.1
1.5
1.8
1.3
-
136
43,803
1.6
2,190
4,537
733
13,811
1.8
805
4,342
44
-
-
-
-
-
-
-
-
-
1.4
1.8
-
-
206
254
-
-
51,250
31,139
1,925
-
1.5
1.8
1.3
-
1.6
2.1
2,532
1,792
44
-
4,368
9,793
Sub-Total Thunderbox
17,821
1.6
914
57,614
1.6
2,995
8,878
1.6
459
84,313
Total Yandal Production Centre
20,326
1.5
1,004
100,468
2.2
7,012
25,548
2.2
1,778
146,342
POGO PROJECT
Stockpiles
Gold in Circuit
Sub-Total Pogo
KCGM
Stockpiles
Gold in Circuit
Sub-Total KCGM
Surface
Underground
Surface
Underground
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7
7
-
-
-
-
-
503
7.0
114
503
7.0
114
9,572
11.0
3,400
12,265
9.7
3,817
21,837
10.3
7,217
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7
9,572
11.0
3,400
12,768
9.6
3,931
22,340
10.2
7,338
219,505
1.8
12,385
99,288
1.3
4,309
318,792
1.6
16,694
49,440
2.2
3,497
54,758
2.4
4,277
104,198
2.3
7,774
122,976
0.7
2,864
-
-
25
-
-
-
-
-
-
-
-
-
-
-
-
122,976
0.7
2,864
-
-
25
122,976
0.7
2,889
268,945
1.8
15,882
154,046
1.7
8,586
545,967
1.6
27,357
Surface
Stockpiles
Sub-Total Ashburton
CENTRAL TANAMI PROJECT JV
-
-
-
-
-
-
-
-
-
98
1.6
-
-
98
1.6
5
-
5
444
1.2
-
-
444
1.2
17
-
17
542
1.3
-
-
542
1.3
22
-
22
Surface/Underground
3,128
2.9
290
5,538
2.8
500
6,052
2.9
566
14,718
2.9
1,356
Stockpiles
700
0.7
16
-
-
-
-
-
-
700
0.7
16
Sub-Total Central Tanami JV
3,828
2.5
306
5,538
2.8
500
6,052
2.9
566
15,418
2.8
1,372
WESTERN TANAMI PROJECT
Surface/Underground
107
7.8
Stockpiles
Sub-Total Western Tanami
375
1.4
482
2.8
27
17
44
1,079
6.0
208
1,449
5.8
271
2,635
6.0
-
-
-
-
-
-
375
1.4
1,079
6.0
208
1,449
5.8
271
3,010
5.4
506
17
523
NORTHERN STAR TOTAL
169,495
1.1
6,058
451,955
2.2 32,046
243,289
2.3
18,288
864,738
2.0
56,392
Note:
1. Mineral Resources are inclusive of Ore Reserves.
2. Mineral Resources are reported at various gold price guidelines: a. A$2,250/oz Au - All Australian assets except Ashburton; b. AUD $1,850 /oz Au -
Ashburton; US$1,500/oz Au - USA assets.
3. Rounding may result in apparent summation differences between tonnes, grade and contained metal content.
4. Bronzewing Project have been re-distributed into the likely processing option either Thunderbox or Jundee.
Competent Person:
Jabulani Machukera
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
reSOUrCeS & reSerVeS
reSOUrCeS & reSerVeS
Ore reserves
Group Ore Reserve of 20.7Moz, despite mining depletion
and portfolio optimisation, reflecting: exceptional growth
at Pogo to 1.8Moz at higher grade of 8.5g/t, Kalgoorlie
Operations to 14.9Moz and reduction of 0.6Moz following
the divestment of the Kundana Assets.
Table 2 Ore Reserves as at 31 March 2022
NST ATTRIBUTABLE RESERVE
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
Proved
Probable
Total Reserve
Tonnes
Grade
Ounces
Tonnes
Grade
Ounces
Tonnes
Grade
Ounces
JUNDEE GOLD PROJECT
Surface
1,851
44
Stockpiles
Gold in Circuit
Sub-Total Jundee
THUNDERBOX PROJECT
Stockpiles
Gold in Circuit
Sub-Total Thunderbox
Total Yandal Production Centre
POGO GOLD PROJECT
Stockpiles
Gold in Circuit
Sub-Total Pogo
KCGM
Stockpiles
Gold in Circuit
Sub-Total KCGM
Underground
Surface
Underground
Surface
Underground
Surface
Underground
45
576
-
2,473
-
8,570
1,925
-
10,495
13,433
-
-
-
-
-
-
-
1.0
2.1
1.1
-
1.1
-
1.7
1.3
-
1.5
1.4
-
-
-
-
-
-
-
475
44
3
522
625
-
-
-
7
7
-
-
60
3
21
5
89
1,338
11,668
-
-
1.7
4.2
-
-
75
1,576
-
-
3,190
11,713
576
-
1.3
4.2
1.1
-
134
1,579
21
5
13,006
3.9
1,651
15,479
3.5
1,740
-
24,344
7,132
-
-
31,476
42,364
1.5
1.9
-
-
1.6
2.2
1,185
24,344
439
15,702
-
-
1,925
-
1,625
41,971
3,060
57,450
1.5
1.8
1.3
-
1.6
2.1
1,185
914
44
3
2,147
3,887
-
-
-
-
-
-
6,590
8.5
1,800
6,590
8.5
1,800
-
-
-
-
-
-
-
-
-
-
-
7
6,590
8.5
1,800
6,590
8.5
1,808
140,035
17,839
-
-
1.7
2.0
-
-
7,863
140,035
1,174
17,839
-
-
122,976
-
1.7
2.0
0.7
-
7,863
1,174
2,864
25
122,976
0.7
2,864
-
-
25
122,976
0.7
2,889
157,874
1.8
9,037
280,850
1.3
11,926
NST ATTRIBUTABLE RESERVE
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
(000’s)
(gpt)
(000’s)
Proved
Probable
Total Reserve
Tonnes
Grade
Ounces
Tonnes
Grade
Ounces
Tonnes
Grade
Ounces
KANOWNA GOLD PROJECT
Surface
-
Underground
2,376
Stockpiles
Gold in Circuit
Sub-Total Kanowna
SKO GOLD PROJECT
Stockpiles
Jubilee ROM Stocks
Gold in Circuit
Sub-Total SKO
CAROSUE DAM PROJECT
Stockpiles
Gold in Circuit
Sub-Total Carosue Dam
Surface
Underground
Surface
Underground
230
-
2,606
-
711
-
208
-
919
588
4,019
2,526
-
7,133
Total Kalgoorlie Production Centre
133,634
PAULSENS PROJECT
Surface
Underground
Stockpiles
Gold in Circuit
Sub-Total Paulsens
ASHBURTON PROJECT
Surface
Stockpiles
Sub-Total Ashburton
CENTRAL TANAMI PROJECT JV
Underground
Underground
Stockpiles
Sub-Total Central Tanami JV
WESTERN TANAMI PROJECT
Stockpiles
Sub-Total Western Tanami
-
186
11
-
197
-
-
-
-
-
-
-
-
-
-
2.7
1.6
-
2.6
-
3.8
-
1.3
-
-
203
12
6
1,426
5,775
-
-
3.0
2.3
-
-
137
432
-
-
1,426
8,151
230
-
220
7,201
2.5
569
9,807
-
87
-
8
3
-
2,717
-
-
-
-
4.1
-
-
-
-
359
-
-
-
-
3,428
-
208
-
3.3
98
2,717
4.1
359
3,636
23
392
58
7
15,996
6,124
-
-
481
22,120
3,688
189,911
1.5
2.7
-
-
1.8
1.8
-
4.0
-
-
768
527
-
-
16,584
10,143
2,526
-
1,295
29,252
11,259
323,545
-
11
-
-
11
-
269
11
-
281
-
84
-
-
84
4.0
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1.2
3.0
1.8
-
2.1
0.9
-
5.1
1.6
-
4.9
-
-
-
-
-
-
-
-
-
-
31
1
-
31
-
-
-
-
-
-
-
-
-
3.0
2.4
1.6
-
2.5
-
4.0
-
1.3
-
3.9
1.5
2.8
1.8
-
1.9
1.4
-
4.8
1.6
-
4.6
-
-
-
-
-
-
-
-
-
137
635
12
6
789
-
446
-
8
-
457
791
919
58
7
1,776
14,947
-
41
1
-
42
-
-
-
-
-
-
-
-
-
45
NORTHERN STAR TOTAL
146,799
0.9
4,338
241,067
2.1
16,346
387,866
1.7
20,683
Note:
1. Ore Reserves are reported at various gold price guidelines: a. A$1,750/oz Au - All Australian assets, b. US$1,350/oz Au - USA assets.
2. Rounding may result in apparent summation differences between tonnes, grade and contained metal content.
3. Ounces are estimates of metal contained in the Ore Reserve and do not include allowances for processing losses.
4. Numbers are 100% attributable to NST.
Competent Person:
Jeff Brown
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
reSOUrCeS & reSerVeS
reSOUrCeS & reSerVeS
46
Resources and Reserves
As at 31 March 2022, Northern Star’s Group Mineral
Resource Estimate (inclusive of Ore Reserves) was 865
million tonnes at 2.0 grams per tonne gold for 56.4 million
ounces (refer page 42) and the Group Ore Reserve
Estimate is 388 million tonnes at 1.7 grams per tonne gold
for 20.7 million ounces (refer page 44). Ore Reserves for
the Australian Operations were estimated at an assumed
gold price of A$1,750/oz. Reserves for the Pogo Operation
were estimated at an assumed gold price of US$1,350/
oz. Reported in ASX release “Resources, Reserves and
Exploration Update” on 3 May 2022 which is also found on
Northern Star’s website (https://www.nsrltd.com/investor-
and-media/asx-announcements/2022/may/resources,-
reserves-and-exploration-update).
Group Mineral Resources Estimate increased significantly
by 16.8 million tonnes from 31 March 2021 to the current
865 million tonnes with grade remaining steady at 2.0
grams per tonne gold for 56.4 million ounces as at 31
March 2022.
Mineral Resource growth of 4.3Moz from exploration
showcases the value generated by the Company’s
sustained exploration investment, more than offsetting
mine depletion and divestments. In addition, it reinforces
Northern Star’s strategy to identify growth opportunities
within strongly endowed geological terrains that can
deliver maximum returns to shareholders.
Group Proved and Probable Ore Reserve remained steady
with 21 million ounces gold as at 31 March 2021 to the
current 20.7 million ounces gold Proven and Probable
Reserve at 31 March 2022, after mining depletion of 1.8
million ounces.
Northern Star is not aware of any other new information
or data that materially affects the information contained in
the Annual Mineral Resource and Ore Reserve statement
31 March 2022 other than changes due to normal mining
depletion during the three month period ended 30 June
2022 and divestment of the Paulsens and Western Tanami
projects during June 2022.
Mineral resources and Ore reserve
governance and Internal controls
Northern Star ensures that the Mineral Resource and
Ore Reserve estimates quoted are subject to governance
arrangements and internal controls activated at a site level
and at the corporate level. Internal and external reviews of
Mineral Resource and Ore Reserve estimation procedures
and results are carried out through a technical review
team that is comprised of highly competent and qualified
professionals. These reviews have not identified any
material issues.
Northern Star reports its Mineral Resources and Ore
Reserves on an annual basis in accordance with the
Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (the JORC Code)
2012 Edition. Mineral Resources are quoted inclusive of
Ore Reserves. Competent Persons named by Northern
Star are Members or Fellows of the Australasian Institute
of Mining and Metallurgy and/or the Australian Institute
of Geoscientists and qualify as Competent Persons as
defined in the JORC Code.
Competent Persons Statements
The information in this Report that relates to exploration
results, data quality and geological interpretations for
the Company’s Operations is based on information
compiled by Daniel Howe, a Competent Person who is
a Member of the Australasian Institute of Mining and
Metallurgy and a full-time employee of Northern Star
Resources Limited. Mr Howe has sufficient experience
that is relevant to the styles of mineralisation and type
of deposits under consideration and to the activity being
undertaken to qualify as a Competent Person as defined in
the 2012 Edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves".
Mr Howe consents to the inclusion in this Report of the
matters based on this information in the form and context
in which it appears.
The information in this Report that relates to Mineral
Resource estimations for the Company’s Operations is
based on information compiled by Jabulani Machukera, a
Competent Person who is a Member of the Australasian
Institute of Mining and Metallurgy and a full-time
employee of Northern Star Resources Limited. Mr
Machukera has sufficient experience that is relevant to
the styles of mineralisation and type of deposits under
consideration and to the activity being undertaken to
qualify as a Competent Person as defined in the 2012
Edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves".
Mr Machukera consents to the inclusion in this Report
of the matters based on this information in the form and
context in which it appears.
The information in this Report that relates to Ore Reserve
estimations for the Company’s Operations is based on
information compiled by Jeff Brown, a Competent Person
who is a Member of the Australasian Institute of Mining
and Metallurgy and a full-time employee of Northern Star
Resources Limited. Mr Brown has sufficient experience
which is relevant to the style of mineralisation and type
of deposit under consideration and to the activity being
undertaken to qualify as a Competent Person as defined in
the 2012 Edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves".
Mr Brown consents to the inclusion in this Report of the
matters based on this information in the form and context
in which it appears.
The information in this Report that relates to the Central
and Western Tanami Gold Projects is extracted from the
Tanami Gold NL ASX announcement entitled “Quarterly
Report for the Period Ending 31 March 2014” released on 1
May 2014 and is available to view on www.tanami.com.au.
The Company confirms that it is not aware of any further
new information or data that materially affects the
information included in the original market announcement
entitled “Quarterly Report for the Period Ending 31 March
2014” released on 1 May 2014 and, in the case of estimates
of Mineral Resources, that all material assumptions and
technical parameters underpinning the estimates in the
relevant market announcement continue to apply and
have not materially changed. To the extent disclosed
above, the Company confirms that the form and context
in which the Competent Person’s findings are presented
have not been materially modified from the original market
announcement.
47
Twin Boom Jumbo Rigs, Pogo
Production Centre, Alaska USA
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Directors’
report
DIreCTOrS' rePOrT
DIreCTOrS' rePOrT
Current Directors
Michael Chaney AO
BSc, MBA, Hon. LLD W.Aust,
FAICD
Chairman
Current age 72
Term Appointed July 2021
Mr Chaney AO was appointed Chairman on 1 July
2021. He is currently Chairman of Wesfarmers Limited
and was previously Chairman of Woodside Petroleum
Limited and National Australia Bank, a Director of BHP
Limited and Managing Director of Wesfarmers from
1992 to 2005.
Mr Chaney AO holds Bachelor of Science and Master
of Business Administration degrees from The University
of Western Australia (UWA) and worked for eight years
as a petroleum geologist in Australia and the USA. He
completed the Advanced Management Program at
Harvard Business School in 1992 and has also been
awarded an Honorary Doctorate of Laws from UWA.
He is former Chancellor of The University of Western
Australia (retired December 2017), former Governor
of the Forrest Research Foundation (resigned
December 2020) and former Director of the Centre for
Independent Studies (resigned July 2022). Mr Chaney
AO is currently Chair of the National School Resourcing
Board and a member of the Gresham Resources
Royalties Fund Investment Committee.
Board skills matrix: Leadership, strategy, people &
culture, risk legal & governance, finance & accounting,
shareholders & stakeholders, sustainability.
50
Stuart Tonkin
BEng (Hons)
Managing Director
& CeO
Current age 46
Term Appointed July 2021*
Mr Tonkin is a mining engineer with more than
25 years’ experience working in the underground
hard-rock mining industry. He was appointed Chief
Executive Officer of Northern Star in November 2016
and had been the Company’s Chief Operating Officer
since 2013. Mr Tonkin was appointed Managing
Director on 22 July 2021.
Prior to joining Northern Star, he was Chief Operating
Officer for mining contractor Barminco, and a Non-
Executive Director of African Underground Mining
Services Ghana. He has extensive experience in the
production of gold, copper, zinc and nickel and has
held senior operational positions with Oxiana and
Newmont in Western Australia.
Mr Tonkin holds a Bachelor of Engineering (Mining)
Degree with Honours from the Western Australian
School of Mines, and WA First Class Mine Managers
Certificate.
*Previously CEO since 2016; COO since 2013
John Fitzgerald
CA, Fellow FINSIA, GAICD
Non-executive Director
Nicholas (Nick)
Cernotta
B.Eng-Mining
Non-executive Director
Current age 60
Term Appointed November 2012*
Current age 60
Term Appointed July 2019
Mr Fitzgerald has over 25 years’ resource financing
experience and has provided project finance and
corporate advisory services to a large number of
companies in the resource sector. He has previously
held senior positions at NM Rothschild & Sons,
Investec Bank Australia, Commonwealth Bank, HSBC
Precious Metals and Optimum Capital. Mr Fitzgerald
is a Chartered Accountant, a Fellow of the Financial
Services Institute of Australasia and a graduate member
of the Australian Institute of Company Directors.
Board skills matrix: Finance & accounting, strategy,
risk legal & governance, leadership, industry
experience, people & culture, shareholders &
stakeholders, sustainability.
*Lead Independent Director until 12 February 2021
Mr Cernotta is a mining engineer having held senior
operational and executive roles in Australia and
overseas for over 30 years. He has considerable
experience in the management and operation of
large resource projects, with a track record for
improving safety performance, managing costs and
improving operational efficiencies, across multiple
commodities and international jurisdictions. Most
recently Mr Cernotta served as Director of Operations
at Fortescue Metals Group Ltd, and was previously
Director of Operations for Barrick (Australia Pacific)
Pty Ltd.
Board skills matrix: Leadership, strategy, industry
experience, people & culture, risk legal & governance,
shareholders & stakeholders, sustainability.
Sally Langer
BCom, CA, GAICD
Non-executive Director
Sharon Warburton
BBus, FCA, FAICD
Non-executive Director
Current age 48
Term Appointed February 2021
Current age 52
Term Appointed September 2021
Ms Langer has more than 25 years’ experience in
professional services across a variety of sectors,
including substantial experience in the resources
sector, where she has advised both ASX-listed and
private boards on talent, organisational design,
succession planning and leadership. Ms Langer has
also been responsible for management functions
including strategy, business development, budgeting
and human resources.
Originally qualified as an accountant with Arthur
Andersen, Ms Langer spent time in their insolvency,
corporate finance and management consulting
practices before transitioning into Executive Search
initially with Michael Page and subsequently Derwent
Executive, where for 13 years she led Derwent’s
national Mining Practice.
Board skills matrix: Leadership, people & culture,
risk legal & governance, finance & accounting,
sustainability.
John richards
BEcon (Hons)
Non-executive Director
Current age 61
Term Appointed February 2021
Mr Richards is an economist with more than 35 years’
experience in the resources industry. He has held
strategy and business development positions across
several mining companies and has worked extensively
in the investment banking and private equity industries.
He has been involved in a wide range of mining M&A
transactions on a global scale.
Previous experience has included Group Executive
Strategy & Business Development at Normandy Mining
Ltd, Head of Mining & Metals Advisory (Australia) at
Standard Bank, Managing Director at Buka Minerals
Ltd and Operating Partner at Global Natural Resources
Investments.
Board skills matrix: Strategy, leadership, industry
experience, risk legal & governance, finance &
accounting.
Ms Warburton is a Chartered Accountant with
experience in the construction, mining and
infrastructure sectors, holding senior executive
positions at Rio Tinto, Brookfield Multiplex, Aldar
Properties PJSC, Multiplex and Citigroup. Ms
Warburton is a non-executive director of Worley
Limited, Wesfarmers Limited, Thiess Group Holdings
Pty Limited and Blackmores Limited and a part-time
member of the Takeovers Panel. She is also on the
board of not-for-profit organisation, Perth Children’s
Hospital Foundation and a non-executive Director of
Karlka Nyiyaparli Aboriginal Corporation RNTBC.
Ms Warburton holds a Bachelor of Business
(Accounting and Business Law) from Curtin University.
She is a Fellow of Chartered Accountants Australia
and New Zealand, the Australian Institute of Company
Directors. She was awarded WA Telstra Business
Woman of the Year in 2014 and was a finalist for The
Australian Financial Review’s Westpac 100 Women of
Influence in 2015.
Board skills matrix: Leadership, strategy, industry
experience, people & culture, risk legal & governance,
finance & accounting, shareholders & stakeholders,
sustainability.
51
Gold pour at Carosue Dam,
Kalgoorlie Production Centre
Western Australia
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Former Directors
Mary hackett
B.Eng-Mech, FIEAUST, GAICD
Former Non-executive
Director
Term Ceased 22 August 2022
Anthony Kiernan AM
B.Eng-Mining
Former Lead Independent
Director
Term Ceased 18 November 2021
30 years executive roles with global oil and gas,
and energy companies.
Management and operation of listed resource
companies (exploration, development and production),
and capital markets experience.
Bill Beament
B.Eng-Mining (Hons), MAICD
Former executive Chair
Term Ceased 1 July 2021
raleigh Finlayson
AdMineSurvey, Bsc (Mine & Eng
Surveying), GradDipMinEng,
GradCertAppFin
Former executive
Director
Term Ceased 22 September 2021
Technical, senior management and executive roles
with mining industry companies in Australia and
Alaska, primarily underground.
Technical, senior management and executive
roles with mining industry companies operating in
Australia, both open pit and underground.
52
53
Underground scaling activities,
Pogo Operations, Alaska, USA
Goodpaster River near Pogo
Operations, Alaska USA
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Board of Directors
Company Secretary
The following persons comprised the Board of
Directors at 30 June 2022.
Michael Chaney AO Chairman
Stuart Tonkin Managing Director & CEO
John Fitzgerald Non-Executive Director
Mary Hackett Non-Executive Director
Nick Cernotta Non-Executive Director
John Richards Non-Executive Director
Sally Langer Non-Executive Director
Hilary Macdonald LLB (Hons), FGIA, was the
Company Secretary (in addition to her role as Chief
Legal Officer) for full year FY22. Ms Macdonald is
a corporate and resources lawyer with 30 years’
experience in the UK and Australia with particular
focus on corporations and mining law, and
governance.
See page 12 for Ms Macdonald's more detailed
biography.
Sharon Warburton joined the Board as a Non-
Executive Director on 1 September 2021. Former
directors of Saracen (with whom the Company
merged on 12 February 2021), Raleigh Finlayson
(Executive Director) and Tony Kiernan AM (Lead
Independent Director) resigned during FY22,
on 22 September 2021 and 18 November 2021
respectively, taking the number of Directors to eight,
three of whom are women (38%).
Outside directorships
Since the end of FY22 Mary Hackett has resigned
from the Board.
The Board acknowledges with gratitude the
retired Directors' significant contributions to the
development of the Company over the course of
their terms of office.
Sharon Warburton Non-Executive Director
Overview of Board changes
Table 1 Directorships in listed companies held by Directors over the past 3 years
The following Directors resigned during FY22:
Bill Beament resigned as Executive Chair on
1 July 2021
Raleigh Finlayson resigned as Executive Director on
22 September 2021
Anthony Kiernan AM resigned as Lead
Independent Director on 18 November 2021
Since the end of FY22 Mary Hackett resigned as a
Non-Executive Director on 22 August 2022.
FY22 marked the return of the Northern Star Board
being chaired by an independent director, with
the resignation of Executive Chair Bill Beament
and the appointment of Michael Chaney AO as
Chairman on 1 July 2021. Stuart Tonkin joined the
Board as Managing Director on 22 July 2021, having
previously occupied the CEO role since November
2016 (and the COO role previous to that).
54
Northern Star's Board of
Directors as at 30 June 2022
Director
Entity
Appointment
Michael Chaney AO Chairman of Wesfarmers Limited
November 2015 to present
Stuart Tonkin
n/a
John Fitzgerald
Director of Danakali Limited
February 2015 to October 2021
Chair of Medallion Metals Limited
Chair of Turaco Gold Ltd
Nick Cernotta
Director of Pilbara Minerals Ltd
Chair of Panoramic Resources Limited
Director of New Century Resources Ltd
John Richards
Chair of Sandfire Resources Limited
Director of Sheffield Resources Ltd
Director of Adriatic Metals Plc
January 2019 to present
July 2021 to present
February 2017 to present
May 2018 to present
March 2019 to present
January 2021 to present
August 2019 to present
November 2019 to July 2020
55
Director of Saracen Mineral Holdings Limited
May 2019 to February 2021
Sally Langer
Director of Sandfire Resources Limited
Director of MMA Offshore Limited
July 2020 to present
May 2021 to present
Director of Saracen Mineral Holdings Limited
May 2019 to February 2021
Sharon Warburton
Director of Wesfarmers Limited
Director of Worley Limited
Director of Blackmores Limited
August 2019 to present
February 2019 to present
April 2021 to present
Director of Gold Road Resources Limited
May 2016 to September 2021
Director and Co-Deputy Chairman of Fortescue Metals
Group Limited
Director of NEXTDC Limited
Former Director
Entity
November 2013 to March
2020 (Co-Deputy Chairman
from April 2017)
April 2017 to March 2020
Appointment
Bill Beament
Managing Director of Develop Global Limited
July 2021 to present
Raleigh Finlayson
Managing Director of Genesis Minerals Limited
February 2022 to present
Managing Director of Saracen Mineral Holdings Limited
April 2013 to February 2021
Mary Hackett
Director of Strike Energy Limited
October 2020 to present
Anthony Kiernan
Chairman of Redbank Copper Limited
Chairman of Pilbara Minerals Ltd
Director of Saracen Mineral Holdings Limited
April 2021 to present
July 2016 to present
September 2018 to
February 2021
Chairman of Develop Global Limited
July 2010 to March 2021
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56
Board Committees
In FY22, the five Board Committees including Audit
& Risk, Environmental Social & Safety, Exploration &
Growth, Nomination and Remuneration Committees
remained constant. Due to COVID-19 and border
restrictions, some Board and Committee meetings
were held virtually in FY22. Effective 1 July
2022, the Remuneration Committee has been
changed to the People & Culture Committee, with
responsibilities for organisational culture and people
strategy in addition to remuneration.
Attendance of current and former Directors at
meetings of the Board and its Committees during
FY22 is detailed in Table 2 below.
Table 2 Committee membership and Director attendance1 at meetings held during FY222,3
Director
Board4
Michael
Chaney AO10
Chairman
16 of 16
Stuart
Tonkin
John
Fitzgerald
Nick
Cernotta
John
Richards
Sally
Langer
Sharon
Warburton11
Former
Director
Bill
Beament12
Raleigh
Finlayson
Mary
Hackett
Anthony
Kiernan
Member
16 of 16
Member
16 of 16
Member
16 of 16
Member
16 of 16
Member
16 of 16
Member
14 of 14
Board
Chair
-
Member
2 of 2
Member
16 of 16
Member
5 of 6
Audit
& Risk5
Environmental
Social &
Safety6
Exploration
& Growth7
Nomination8 Remuneration9
-
-
Chair
6 of 6
-
Member
6 of 6
Member
6 of 6
-
Audit
& Risk
-
-
Member
6 of 6
-
-
-
-
-
-
Member
4 of 4
Member
3 of 3
Member
4 of 4
Member
1 of 1
Member
2 of 2
-
-
Member
4 of 4
Chair
4 of 4
-
-
-
-
Member
1 of 1
Member
1 of 1
Member
1 of 1
Member
1 of 1
Member
-
Member
8 of 8
Chair
8 of 8
-
Member
8 of 8
Member
2 of 2
Environmental
Social &
Safety
Exploration
& Growth
Member
-
Member
-
-
Chair
4 of 4
Member
1 of 1
-
-
-
Nomination Remuneration
-
-
Member
1 of 1
Chair
1 of 1
-
-
-
Member
6 of 6
1. Attendance at meetings while the Director held office, or was a member of the Committee, during FY22 at which the Director was eligible to attend (i.e.
not excluded due to a conflict of interest). See footnotes for details of Committee meetings Directors attended in an invitee/observer capacity only. A
dash indicates the Director was not a member of that Committee during FY22.
2. There were a number of Board/Committee meetings at which only Directors with delegated authority were present, not included in the table above.
3. During FY22 meetings of the Non-Executive Directors were held immediately before most Board meetings, without any executive Directors in attendance
4. 4 special purpose Board meetings were held in FY22 (in addition to monthly Board meetings) for business development related business.
5. The following Directors attended Audit & Risk Committee meetings in FY22 in an invitee/observer capacity: Michael Chaney AO 4 meetings, Stuart
Tonkin 1 meeting, Sharon Warburton 3 meetings, and Anthony Kiernan AM 1 meeting.
6. The following Directors attended Environmental, Social & Safety Committee meetings in FY22 in an invitee/observer capacity: Michael Chaney AO 4
meetings, Stuart Tonkin 2 meetings, and Raleigh Finlayson 1 meeting.
7. The following Directors attended Exploration & Growth Committee meetings in FY22 in an invitee/observer capacity: Stuart Tonkin 4 meetings, John
Fitzgerald 2 meetings, Mary Hackett 1 meeting, Sally Langer 2 meetings, Sharon Warburton 2 meetings, and Raleigh Finlayson 1 meeting.
8. Stuart Tonkin attended 1 Nomination Committee meeting in FY22 in an invitee/observer capacity.
9. The following Directors attended Remuneration Committee meetings in FY22 in an invitee/observer capacity: Michael Chaney AO 4 meetings (prior to his
joining the Committee), Stuart Tonkin 3 meetings, and Mary Hackett 1 meeting.
10. Michael Chaney AO joined the Remuneration Committee on 15 October 2021 and chairs the Nomination Committee since Anthony Kiernan’s resignation
on 18 November 2021.
11. Sharon Warburton joined the Remuneration Committee, and the Environmental, Social & Safety Committee, on 15 October 2021.
12. Bill Beament did not attend any meetings in FY22 as his term on the Board ended on 1 July 2022.
Board evaluation
Northern Star prioritises effective corporate
governance and advancing the Company’s culture
of continuous improvement, including by evaluating
Director performance annually. In FY22 the
Board engaged external experienced governance
specialists to undertake the annual performance
evaluation of the Board and its Committees.
The FY22 Board review focused on assessing Board
drivers and dynamics, governance matters, areas
of strength and opportunities for improvement, in
the context of the Company’s strategic agenda and
priorities. Areas of assessment included:
• Organisational strategy and objectives;
• Director characteristics and the contributions of
each Director;
•
Board behaviour, including relationships between
the Directors and with management, critical
thinking and agile decision making;
• the effectiveness and performance of the Board,
its Committees and the relationship with the
management team;
• the effectiveness of Board governance
practices, including the Board’s oversight of risk
management systems;
• Board composition and the alignment of Board
skills to strategy, including current and future
needs;
• the Board's role in shaping and overseeing
culture within the organisation; and
• the quality of materials put to the Board.
The evaluation involved the Directors completing
detailed questionnaires, and included hour long
interviews with the Executive KMP to gain useful
insights into Board and management relationships.
A comprehensive report was delivered on
overall Board effectiveness, as well as individual
Director feedback reports, based on review of key
governance materials and conversations held with
all Directors and Executives.
Overall, the Board and each Committee was
evaluated as being cohesive and highly effective,
with a demonstrated strong commitment to
Northern Star's success, and sound dynamics
between Board members and with management.
Following the evaluation, the Board resolved to
restructure the Remuneration Committee as a
People & Culture Committee from 1 July 2022,
with the additional responsibility of overseeing
organisational culture (previously a responsibility of
the ESS Committee).
57
Rock pools at Carosue Dam,
Kalgoorlie Production Centre,
Western Australia
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 DIreCTOrS' rePOrT
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Board skills matrix
Northern Star considers that assessing the optimal
Board skills, and periodically measuring the
Board’s skills, is essential to Board composition
and succession planning, including identifying
any potential emerging gaps and ensuring there
is an appropriate balance of and diversity of skills,
experience and expertise on the Board.
The Board skills matrix was substantially reviewed in
FY22. The Company engaged external governance
specialists to formulate and update the skills matrix
in conjunction with the Chairman and Company
Secretary. An in-depth analysis of the Board's
skills, experience and diversity factors was then
undertaken.
Similar to previous years, each Non-Executive
Director was asked to self-assess their own levels
of skill, capability and experience in 69 different
areas, grouped into 9 categories, against a four-tier
scale (from ‘Limited’ to ‘Expert’). The Managing
Director & CEO was not included in the assessment,
as the purpose is to determine the Non-Executive
Directors' collective depth of understanding,
experience and capability in overseeing executive
decisions and actions. The 9 categories were
selected on the basis of the Company’s nature and
scale, industry and jurisdictions in which it operates,
workforce, operations and business strategy. The
Board’s self-assessment against the new FY22 Board
skills matrix demonstrated extensive skills, capability
and experience in leadership, strategy, people &
culture, and risk legal & governance, with finance &
accounting well represented with 3 Directors at the
'Expert' level. Although the Board has limited direct
skills and experience in IT & Digital, the Board leads
strategy on and has oversight of management's
adoption of technology advancements, and cyber
security and technology failure risk management.
Overall, an appropriate diversity of skills, knowledge
and experience is represented on the Northern Star
Board. An overview of the results of the skills matrix
is depicted in Table 3 below.
Table 3 Summary of skills measured in the updated FY22 Board skills matrix
Board diversity
In addition to the Board skills matrix analysis,
the external governance specialists conducted a
detailed analysis of the Board's composition, with a
view to evaluating whether the Board has diversity
that optimises decision making. The key areas of
cognitive, experiential, personality and demographic
diversity were assessed, with each Director
identifying where they considered they and the
Board sat along a continuum.
The findings indicated the Board has good diversity
and balance across the diversity indicators,
including:
• a high level of experiential diversity, with
experience across both established large
institutions and start up organisations;
• appropriate cognitive diversity, with strong
representation of analytical ability; and
• a good balance in personality diversity, ensuring
both a willingness to scrutinise and work
cooperatively with management.
As at 30 June 2022, Northern Star’s gender
diversity on the Board of 38% women is above
its 30% target (set in FY19 for achievement by 31
December 2021, in line with ASX Recommendation
1.5) and above the 35% women average of ASX 50
boards14. The Board also has diversity of both age
and tenure, as depicted in Figure 1 below.
The Board supports the view that truly diverse
boards have more perspectives with which to
address challenges, less risk of groupthink, and
consequently may engage in more robust debate
and better informed decision-making.14 The Board’s
composition is regularly reviewed to ensure that an
appropriate balance of skills, experience, expertise
and all aspects of diversity is represented on the
Board. In future Board appointments, the Board
is committed to expanding its diverse base of
experience, age, ethnicity and gender.
Skills
Description of skill category
Board rating13
Figure 1 Diversity statistics of the Board at 30 June 202215
58
Leadership
Strategy
Mining industry
experience
People & Culture
Risk, Legal &
Governance
Finance &
Accounting
Information
Technology
& Digital
Shareholders &
Stakeholders
Sustainability
Senior executive or director leadership experience in organisations of comparable
size and complexity
Experience in corporate planning, capital allocation, devising implementing and
monitoring performance against strategic objectives, and M&A divestments and
business integration
Experience in resource exploration/development, major projects, mining operations,
environmental management or commodities
Experience assessing and shaping organisational culture, people management,
retention and succession planning, setting remuneration frameworks, overseeing
health, safety and wellbeing programs, and promoting diversity and inclusion
Experience identifying, assessing and managing financial and non-financial risks,
overseeing risk management frameworks and controls, identifying and resolving
legal and regulatory issues, and compliance with highest standards of corporate
governance
Understanding of financial statements and reporting, overseeing external and
internal audit, understanding effectiveness of financial controls, and debt and equity
markets experience
Understanding information technology systems and associated risks, technological
innovation in resources, use of data and analytics, and experience responding to
digital disruption and cyber security incidents
Experience engaging with shareholders and stakeholders on performance and
strategy, understanding of Indigenous communities and culture, and experience
working with government and industry regulators
Understanding of shifting community expectations, disclosure and reporting
requirements, and global and national developments in ESG issues including climate
change and human rights
Board Rating Key
Top quartile
Second quartile
Third quartile
Fourth quartile
13. Out of 100
80
75
60
75
75
72
35
58
62
Gender
Independence
Age
Tenure
59
Male
63%
Female
38%
Independent
88%
Non-Independent
13%
70+
13%
60-69
25%
40-49
25%
50-59
38%
< 1 Yrs
38%
1 to 2 Yrs
25%
4 to 8 Yrs
0%
2-3 Yrs
25%
9 Yrs
13%
14. 2022 Board Diversity Index published by Governance Institute/Watermark.
15. These percentage figures have been rounded.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 DIreCTOrS' rePOrT
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review of operations
A review of the operations and financial position of
the Group and its business strategies and prospects
is set out in the Operating and Financial Review
section at pages 14 to 39 of this Annual Report.
Principal activities
In FY22 the principal activities of the Group were:
• exploration, development, mining and processing
of gold deposits and sale of refined gold derived
from its three regional production centres: the
Kalgoorlie Operations (including KCGM) and
Yandal Operations in Western Australia, and the
Pogo Operations in Alaska; and
• exploration of gold deposits in Western Australia,
the Northern Territory and Alaska.
Dividends paid
Table 4 Dividends paid in FY22 and FY21
Interim ordinary dividend for FY20 of 7.5 cents per fully paid Share paid on
16 July 2020
FY22
$’000
FY21
$’000
n/a
$55,503
Final ordinary dividend for FY21 of 9.5 cents (FY20: 9.5 cents) per fully paid
Share paid on 29 September 202116
$110,637
$70,377
Special dividend of 10 cents per fully paid Share paid on 30 September
2020
n/a
$74,080
60
Interim ordinary dividend for FY22 of 10 cents (FY21: 9.5 cents) per fully
paid Share paid on 29 March 202217
Total
$116,448
$110,513
$227,085
$310,473
Dividends recommended but not yet paid
Since the end of FY22, on 28 August 2022 the
Directors have recommended the payment of a
fully-franked final ordinary dividend of $134.0 million
(11.5 cents per fully paid Share; FY21: 9.5 cents),
to be paid on 29 September 2022 out of retained
earnings at 30 June 2022.
Significant changes in the state of affairs
Significant changes in the state of affairs of the
Group during FY22 include:
announced 23 November 2021 and completed
1 December 2021; and
• the issuance of a C$154 million (A$169 million)
convertible senior unsecured debenture with
Osisko Mining Inc;
• the sale of the Kundana Assets to Evolution
Mining Ltd announced 22 July 2021 and
completed 18 August 2021;
• the acquisition of Newmont Corporation’s
power business in Kalgoorlie, including a 50%
interest in the 110MW Parkeston Power Station
• the sale of the Paulsens and Western Tanami
Gold Assets to Black Cat Syndicate Limited
announced 13 April 2022 and completed 15 June
2022.
For further details on the above acquisition and
divestments refer to Note 3 of the financial
statements.
16. DRP price $9.32 being the 5-day VWAP immediately after the record date of 7/9/2021.
17. DRP price $10.75 being the 5-day VWAP immediately after the record date of 8/3/2022.
events since the end of FY22
Since 30 June 2022, in addition to the final fully-
franked dividend mentioned on the previous page,
the Board approved an on-market share buy-back
of up to $300 million to be completed over the 12
months from 15 September 2022. See Note 19 to
the financial statements for further details.
Likely developments and expected
results of operations
There are no likely developments to disclose in the
Group’s operations in future financial years.
Performance in relation to
environmental regulation
The Group’s exploration, mining and processing
operations are subject to Commonwealth of
Australia, Western Australian, Northern Territory,
State of Alaska and Federal US legislation which
regulates the environmental aspects of the Group’s
activities, including discharges to the air, surface
water and groundwater, and the storage and use of
hazardous materials. The Group is not aware of any
material breach of environmental legislation and
regulations applicable to the Company’s operations
during FY22. A notification of breach was received
in 2021, following an inspection during 2019 by the
United States Environmental Protection Agency
at our Pogo Operations. Northern Star received
notification that several waste streams at the assay
laboratory in the Pogo processing plant were not
determined, registered and managed according to
Resource Conservation and Recovery Act (RCRA)
technical requirements. Whilst there was no harm
caused to the environment, the breach of RCRA
will result in financial penalties during FY23, which
are currently under discussion. The Company is
expanding its current training in RCRA compliance
to address any gaps identified to meet RCRA
requirements. The Group continues to comply with
environmental regulations in all material respects.
Insurance of officers and indemnities
During FY22 the Company has paid a premium to
insure the Directors and Officers of the Company
and its controlled entities. Details of the premium
are subject to a confidentiality clause under
the contract of insurance. The liabilities insured
are costs and expenses that may be incurred in
defending civil or criminal proceedings that may
be brought against the Directors and Officers in
their capacity as officers of entities in the Group,
to the extent permitted by the Corporations Act. In
addition, similar liabilities are insured for Officers
holding the position of nominee Director for the
Company in other entities.
Proceedings on behalf of the
Company
No person has applied to the Court under Section
237 of the Corporations Act 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.
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 Group are important. Details of
the amounts paid or payable to the Auditor (Deloitte
Touche Tohmatsu) for the audit services provided
during FY22 are disclosed in Note 22 to the financial
statements.
The Company adopted a Policy for Provision of
Non-Audit Services by External Auditor during
FY22. In addition to fees for audit services, Deloitte
Touche Tohmatsu provided consulting services to
the value of $79,000 in FY22, as detailed in Note 22
to the financial statements.
Auditor independence declaration
A copy of the Auditor’s independence declaration
as required under section 307C of the Corporations
Act is set out on page 102.
rounding
The Company is of a kind referred to in ASIC
Legislative Instrument 2016/191, relating to
the “rounding off” of amounts in the financial
statements. Amounts in the financial statements
have been rounded off in accordance with the
instrument to the nearest hundred thousand dollars,
or in certain cases, the nearest dollar.
61
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Corporate Governance Statement
Northern Star and the Board are committed to
consistently demonstrating the highest standards
of corporate governance. In addition to this Annual
Report, a description of the Company’s current
corporate governance practices is set out in the
Corporate Governance Statement (http://www.
nsrltd.com/about/corporate-governance/).
Figure 2 Corporate Governance framework
This report is made in accordance with a Resolution
of Directors dated 28 August 2022.
Pogo Operations,
Alaska USA
Michael Chaney AO
Chairman
28 August 2022
S TA KEHOLDERS
S H A REHOLDERS
A C C O UNTABILITIES
62
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63
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
remuneration
report
reMUNerATION rePOrT
reMUNerATION rePOrT
Letter from the Chair
of the People & Culture
Committee
Dear shareholder,
Safety
It matters and
starts with you
results
We deliver on
our promises
Teamwork
Together
we can
On behalf of the Board of Directors of
Northern Star Resources Ltd, I am pleased
to provide to you the Remuneration Report
for the financial year ended 30 June 2022.
We responded to the feedback received in relation
to the FY20 Remuneration Report and the “first
strike”, and I am pleased with the overwhelming 97%
vote in support of the FY21 Remuneration Report at
the 2021 Annual General Meeting.
Northern Star is in a strong position, with gold sold
of 1.56 million ounces in FY22 generating Cash
Earnings of over $1 billion. At 30 June 2022 we
held cash and bullion of $628 million and liquidity
of $1.5 billion, all underpinned by a solid platform
of 56.4 million ounces of Mineral Resources and
66
20.7 million ounces of Ore Reserves. Interim and
final dividends paid to our shareholders during FY22
totalled $227.1 million including dividends reinvested
under our Dividend Reinvestment Plan.
FY22 was a challenging period for our workforce
in Australia and the US, and we saw extraordinary
efforts applied to manage the challenges and
achieve the best results possible. We experienced
cost pressures across the operations (notably
in relation to labour, steel, fuel and energy) and
resourcing pressures with continuing skill shortages
and ongoing competition for labour. The COVID-19
disruption continues to impact workforce numbers
and we adjust our plans accordingly. These impacts
are being experienced globally.
respect
To get it you
must give it
Accountability
The responsibility
lies with you
67
FY22 remuneration Outcomes – FY22 STI performance rights – (52.4% result)
The Company’s FY22 short term incentive
performance rights were measured on 30 June
2022, following a one year performance period,
achieving a 52.4% outcome.
The safety outcome with a TRIFR of 2.0 is
outstanding, likely industry leading and significantly
better than the performance measure threshold
target of 5.0. We are incredibly proud of our safety
performance which continues to remain better than
the industry standard, an exceptional achievement
and clear evidence of continual safety improvement,
consistent with the STARR Core Values. This
improvement in the last 12 months was achieved in
the context of:
• the enlarged Group operations;
• significant project expansion and shutdown
work;
• the impact of COVID-19 continuing at all of our
sites;
• the labour market pressures leading to a
larger than normal percentage of new and
inexperienced starters; and
• the sheer number of worker hours involved
in our underground, open pit and processing
operations.
The excellent 86% result for participation in the
November 2021 culture survey and the employee
engagement score of 68% set a new baseline for
the combined Group. To address feedback we
received during the culture survey, significant efforts
will continue to focus on and reinforce each of the
STARR Core Values.
Production Performance delivered inside Group
guidance and Financial Management delivered
inside a revised cost guidance. The actual AISC
outcome was $1,633. The Board exercised its
discretion to normalise the AISC to $1,555/oz, in
order to acknowledge extraordinary cost escalations
experienced and outside of the control of
Management, such as labour, steel, fuel and energy.
This discretion resulted in an increase of the FY22
STI measurement outcome, from 34.4% to 52.4%.
FY22 remuneration Outcomes – FY20 LTI performance rights – (35% result)
The Company’s FY20 long term incentive
performance rights were measured on 30 June
2022, following a three year performance period,
achieving a 35% outcome. Whilst reflective of our
relative shareholder return against our Peer group
and a Gold Index, this does not reflect the significant
efforts made in what has been a transformative
period for the Company since 1 July 2019, notably
the acquisition of a 50% interest in the KCGM
Operations in January 2020, and implementation
of the Scheme of Arrangement with Saracen in
February 2021, resulting in the Fimiston Open Pit
(Super Pit) being controlled by a single entity for the
first time in its history.
Results for the FY20 LTI key performance indicators:
• Financial Performance was almost fully met;
this was very pleasing, given the operational
challenges the Company operated under;
• Ore Reserve maintenance and growth
performance measures were met, including the
acquisition of the KCGM Operations; and
• notwithstanding the significantly improved
physicals at Pogo demonstrating the future
capacity to meet 300kozpa, Pogo Operations
did not achieve the ramp up to that sustainable
production level, required to be met by 30 June
2022.
No discretion was applied by the Board to adjust
these outcomes or the performance measures.
Half of the vested FY20 LTI were subject to a
holding lock for 12 months until 30 June 2023.
The Board has exercised discretion to remove
that requirement, given the relatively low level of
vesting. Noting that there is no service condition
contributing to retention of employees and with
no adverse effect on the business, exercising this
change enables the relevant employees to better
manage their tax arrangements in connection
with the vested FY20 LTI. It also offers a degree
of welcomed flexibility to our key employees and
actually enhances employee retention.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
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FY23 remuneration
No changes have been made to fixed and variable
remuneration for the KMP, other than small
adjustments to weightings, in response to investor
feedback. The Committee considers that the FY23
remuneration framework ensures there is effective
alignment between shareholder wealth creation,
performance and reward, taking into account the
size and complexity of the Company’s operations.
Board fees remained unchanged, noting that Board
remuneration is now paid entirely in cash since
awards under the FY20 NED Share Plan are no
longer being proposed. Whilst the Salary Sacrifice
option for Non-Executive Directors will no longer
be available the Minimum Holding Policy, which
encourages greater alignment between the Board
and shareholder interests, through a gradual
accumulation of equity over a defined period,
remains intact. Pleasingly all Company Directors are
current shareholders and intend to progressively
increase their respective shareholdings, up to the
value of their annual base fee as a minimum.
FY23 STI awards – performance measures
The FY23 STI performance measures follow in
a similar vein to the FY22 STI. The Board has
marginally increased the weighting on gold sales,
recognising that the biggest lever to reducing
all-in sustaining costs is by increasing gold sales.
Increased gold sales is also aligned to our longer
term objectives of being a 2Moz pa producer and
generator of better cash returns.
FY23 LTI awards – performance measures
Lastly, the Remuneration Committee identified
that modification of its scope to include leadership
development; culture overview; people strategy and
wellbeing would be beneficial, and that it would be
appropriate to reflect this expanded purpose with a
new name - the People & Culture Committee. The
Board implemented these changes with effect from
1 July 2022.
On behalf of the Board, your continued support as a
shareholder is greatly appreciated.
Yours sincerely
Nick Cernotta
People & Culture
Committee Chair
28 August 2022
68
Consistent with the FY22 LTI awards, the FY23
LTI performance rights are subject to a four year
measurement period. The performance measures for
the FY23 LTI awards comprise:
• relative total shareholder return against a specific
gold peer group, (40% weighting this year up
from 35%);
• relative total shareholder return against the
Global Gold Index peer group, (40% weighting
this year up from 35%), and
• demonstration of tangible, sustainable Scope 1
and 2 carbon Emissions Reductions of 150,000
tonnes CO2 equivalent between 1 July 2021
and 30 June 2026 below business as usual
levels (20% weighting to ESG this year, down
from 30%).1 The Board resolved that the same
principles will apply to the metric for the FY22
LTI-1 and LTI-2 KPIs.
The changes in weightings reflect feedback from
investors from last year’s engagement meetings.
The Board is confident that the FY23 remuneration
structure is appropriate to reward and retain
the high performing team at Northern Star. The
Committee will continue to monitor the reward
structure in place to assist with effective retention of
KMP and the broader leadership and management
teams, particularly during times where retention of
quality and skilled labour is business critical.
1. For the avoidance of doubt the 150,000 t (CO2 Equivalent) target for the FY23 LTI will take into account any aggregate reduction achieved under the FY22
LTI-2 and LTI-1 KPI by end of FY25.
69
Aerial over Denali National
Park and Preserve near Pogo
Operations, Alaska USA
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
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Transparency in reporting Key
Management Personnel remuneration
Easy to access information and transparency in remuneration reporting is important to Northern Star and
its shareholders. This Remuneration Report includes the following voluntary and statutory disclosures:
Background to the Company’s KMP
remuneration practices and governance
1. Details of the Key Management Personnel
Contents
Background to the Company’s KMP remuneration practices and governance
1. Details of the Key Management Personnel
2. Remuneration Governance
3. Financial performance over the past 5 years
4. KMP remuneration policy and link to performance
FY22 Executive KMP remuneration
5. Executive KMP remuneration mix for FY22
6. FAR for FY22
7. STI vested at end of FY22
8. LTI granted in FY20 vested at end of FY22
9. LTI granted in FY21 unvested at end of FY22
10. LTIs granted in FY22 unvested at end of FY22
FY23 Executive KMP remuneration
11. Executive KMP remuneration mix for FY23
12. FAR for FY23 compared to FY22
13. STI granted in FY23
14. LTI granted in FY23
70
FY22 & FY23 Non-Executive Director remuneration
15. Non-Executive Directors’ Remuneration for FY22 and FY23
Statutory remuneration disclosures
16. Statutory remuneration table – Executive KMP
17. Statutory remuneration table – Non-Executive Directors
18. Allocation methodology for grant of FY22 STI & LTI Performance Rights
19. Allocation methodology for grant of FY22 NED Share Rights
20. Securities held by KMP during FY22
21. Contractual Arrangements with Executive KMP
Summary of FY20 Share Plan
71
71
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73
74
75
75
75
76
78
80
82
84
84
84
84
86
89
89
90
90
93
94
95
96
98
100
The following Directors and Executives were the Company’s Key Management Personnel (KMP) in FY22.
Former Executives and Non-Executive Directors who were KMP for part of FY22 and FY21 are also covered
by this Report, where required. Movement since 30 June 2022 to the date of this Report is also included.
Table 1 Key Management Personnel during FY22 and movement after 30 June 2022
KMP
Role
Appointment Date
Ceased Date
Executives
Stuart Tonkin
Managing Director & CEO
22 July 20213
Simon Jessop
Chief Operating Officer
12 February 2021
Ryan Gurner
Chief Financial Officer
31 December 20213
Hilary Macdonald
Chief Legal Officer &
Company Secretary
23 February 2018
Non-Executive Directors
Michael Chaney AO Chairman
1 July 2021
John Fitzgerald
Non-Executive Director
30 November 2012
Nick Cernotta
Non-Executive Director
1 July 2019
John Richards
Non-Executive Director
12 February 2021
Sally Langer
Non-Executive Director
12 February 2021
Sharon Warburton
Non-Executive Director
1 September 2021
-
-
-
-
-
-
-
-
-
-
Former KMP
Role
Appointment Date
Ceased Date
Former Executives
Bill Beament
Executive Chair
20 August 2007
1 July 2021
Raleigh Finlayson
Executive Director
22 July 20214
30 September 2021
Morgan Ball
Chief Financial Officer
12 February 2021
31 December 2021
Former Non-Executive Directors
Mary Hackett
Non-Executive Director
1 July 2019
22 August 2022
Anthony Kiernan
Non-Executive Director
12 February 2021
18 November 2021
2. Previously CEO from 29 October 2016, and COO from 2013-2016.
3. Previously EGM Finance from 12 February 2021.
4. Previously Managing Director from 12 February 2021.
71
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2. remuneration Governance
The People & Culture Committee (formerly
the Remuneration Committee) is chaired by
independent Non-Executive Director, Nick Cernotta,
and its members are independent non-executive
Directors, Michael Chaney AO, John Fitzgerald,
Sally Langer and Sharon Warburton. The Managing
Director & CEO and other Directors have a standing
invitation to attend all or part of the Committee
meetings but do not participate in recommendations
by the Committee to the Board.
The Committee meets several times a year as
required to review and make recommendations
to the Board in accordance with the Committee
Charter to ensure that KMP remuneration remains
aligned to business needs and performance and
to ensure that equity plans are appropriate for
all employees. A copy of the Charter is available
under the Corporate Governance section of the
Company’s website available at http://www.nsrltd.
com.
In FY22, the role of the Remuneration Committee
was to review and make recommendations to the
Board in relation to KMP and other executives in
respect of:
• Remuneration and incentive policy including
structures, practices, and quantum;
public materials including ASX releases and the
Annual Report;
• Superannuation arrangements; and
• Overseeing remuneration by gender and other
diversity measures.
From time to time, advice and recommendations are
sought from remuneration consultants observing the
following protocols:
• Remuneration consultants are engaged by and
report directly to the Remuneration Committee;
• The Committee must, in deciding whether to
approve the engagement, have regard to any
potential conflicts of interest including factors
that may influence independence such as
previous and future work performed by the
adviser and any relationships that exist between
any executive KMP and the consultant; and
• Communication between the remuneration
consultants and Executive KMP is restricted to
minimise the risk of any allegations of undue
influence on the remuneration consultant.
The Board makes its decisions after it considers
the recommendations from the Remuneration
Committee and any advice from remuneration
consultants.
• Determining the eligibility, award and vesting
of Short Term Incentives (STI) and Long Term
Incentives (LTI);
No remuneration recommendations (within the
meaning of the Corporations Act) were sought or
made during FY22.
• Non-Executive Director individual remuneration,
and the aggregate pool for approval by
shareholders (as required);
• Disclosure of remuneration in the Company’s
The advisory vote to adopt the FY21 Remuneration
Report was passed by 97% of shareholders who
voted, at the Company's annual general meeting
held on 18 November 2021.
72
Robust remuneration governance is essential to delivering
Executive pay that fairly attracts and retains talent, and
fairly rewards performance that creates sustainable value
consistent with the long-term interests of shareholders.
3. Financial performance over the past 5 years
The charts below illustrate some of the Company’s FY22 key financial achievements:
Figure 1 Cash flow from Operations (A$M)
Figure 2 Underlying EBITDA (A$M)
$1,800
$1,600
$1,400
$1,200
$1,000
$800
$600
$400
$200
$-
0
1
7
$
0
2
Y
F
3
5
3
$
8
1
Y
F
9
9
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2
3
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$
$
9
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Y
F
$1,600
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
9
9
5
,
1
$
7
9
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$
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3
4
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Figure 3 Gold Sold (oz)5
Figure 4 Average Gold Price (A$/oz)
73
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
,
0
8
5
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4
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8
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,
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$3,000
$2,500
$2,000
$1,500
$1,000
$500
0
3
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2
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5. Gold Sold includes pre-production sales that were capitalised to Mine Properties.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022
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4. KMP remuneration policy and link to performance
Our remuneration policy is designed to support
our Purpose: To generate superior returns for our
shareholders while providing positive benefits for
our stakeholders, through operational effectiveness,
exploration and active portfolio management.
Our KMP remuneration policy and practices
underpin our business objectives, which include:
Results
Deliver on our
promises
Returns
Target superior financial
performance
Responsibility
Positive legacy from
business activity
FY22 executive KMP remuneration
5. executive KMP remuneration mix for FY22
Executive remuneration has a fixed component
(base salary plus superannuation capped at $25,000
per annum) and a component that varies with
performance (STI and LTI). The remuneration mix is
weighted towards the variable component, which
is awarded in cash and Performance Rights for STI
(with ability to elect to take 100% in Performance
Rights), and in Performance Rights for LTI, to reward
for achievement of strategic objectives aligned with
shareholders’ interests.
The table below outlines the remuneration policy framework which applied in FY22.
Figure 5 FY22 total remuneration opportunity mix for Northern Star Executive KMP8,9
Table 2 FY22 remuneration framework
Stuart Tonkin
18.2%
18.2%
36.4%
27.3%
Policy objective
Remuneration practices aligned with policy objective
Simon Jessop
26.7%
26.7%
26.7%
20%
Retain an experienced,
cohesive, proven, high
performance, multi-
disciplinary team to
deliver the Company’s
strategic objectives
• Provide remuneration that is internally fair and benchmarked against appropriate
peer group on a regular basis.
• Ensure remuneration is competitive with the gold industry labour market and other
competition for our people.
• Provide total remuneration opportunities to retain proven and experienced KMP
who are global company poaching targets.
Align KMP interests
with the interests of
shareholders
• A significant proportion of remuneration is at risk, performance-based and
delivered in Shares, aligning Executive KMP reward with increased value for
shareholders.
74
• Performance metrics measured against stretch targets that reward for longer term
value, consistent with our business strategy.
Ryan Gurner
Hilary Macdonald
28.6%
28.6%
21.4%
21.4%
28.6%
28.6%
21.4%
21.4%
The following sections 6 to 14 of this Report provide more information about:
Key
FAR
STI
LTI-1
LTI-2
• FAR;
• STI and LTI KPIs;
75
• Minimum holding condition policy applies to KMP requiring a minimum level of
• measurement of performance against the FY22 STI;
Share and vested Performance Rights ownership as follows:
- Managing Director & CEO:
- COO, CFO, CLO & Co Sec:
- Non-Executive Directors:
100% of FAR6
50% of FAR
100% NED base fee
Focus on safety
• Safety performance metrics (employee and contractors) building in year on year
improvements, to measure performance over different time horizons for sound risk
management and to ensure outcomes focus on the longer term.
Focus on sustained
costs and annual gold
sales
• No fatality gateway for STI & LTI safety metrics.
• STI including delivering within guidance:
- Challenging annual production performance and gold sales targets; and
- All-In Sustaining Cost (AISC).
Focus on our people
and create a desirable
Company culture
• Provide targeted strategic incentives from the top down, to promote
improvements in organisational culture, to attract and retain a diverse and inclusive
workforce in line with the STARR Core Values.7
• Focus and facilitate the development and retention of our people to ensure a
sustainable pipeline of diverse talent within the business.
Focus on positive
ESG outcomes
• Deliver positive ESG outcomes for the benefit of our stakeholders and the
communities in which we operate.
• Focus on achieving an absolute reduction in greenhouse gas emissions,
developing a sustainable Indigenous business supply contract pipeline, and
responsible water management.
Ability to apply malus
and clawback
• The Board may reduce unvested awards, and clawback previously vested
Awards within two years of being delivered in Shares, in instances of significant
negligence, non-compliance or other harmful act by the individual, or where
retaining such Award would be grossly unjustifiable. The Board reduced unvested
awards during FY22 for misconduct reasons, in relation to former employees.
6. FAR means fixed annual remuneration comprising base salary plus superannuation.
7. Our STARR Core Values are: Safety, Teamwork, Accountability, Respect, Results.
• measurement of performance against the FY20 LTI; and
• FY23 FAR, STI and LTI for the Executive KMP including rationale for the KPIs selected.
6. FAr for FY22
Fixed annual remuneration (FAR) comprises
employees’ cash salary and the direct costs of
employee benefits, aimed at providing a base level
of remuneration appropriate for the particular role
and level of responsibility that is competitive in the
market.
The key elements of FAR paid to the Executive
KMP are:
• Cash salary, plus superannuation capped at
$25,000 per annum.
• Benchmarking of salaries annually against
ASX 100 and mining industry peers for
comparable roles and responsibilities.
• Periodic remuneration reviews conducted by the
Remuneration Committee.
See Table 15 (statutory remuneration table) for FAR
paid to the Executive KMP in FY22 (compared
to FY21), and see Table 11 for the FAR payable to
Executive KMP for FY23.
8. These figures have been rounded. Figure 5 is a voluntary disclosure included in this Report to improve transparency around how Northern Star rewards
Executive KMP and has not been prepared in accordance with Australian Accounting Standards.
9. Stuart Tonkin FY22 maximum opportunity = FAR (100%), STI (100% of FAR), LTI-1 (200% of FAR) and LTI-2 (150% of FAR).
Simon Jessop FY22 maximum opportunity = FAR (100%), STI (100% of FAR), LTI-1 (100% of FAR) and LTI-2 (75% of FAR).
Ryan Gurner FY22 maximum opportunity = FAR (100%), STI (75% of FAR), LTI-1 (100% of FAR) and LTI-2 (75% of FAR).
Hilary Macdonald FY22 maximum opportunity = FAR (100%), STI (75% of FAR), LTI-1 (100% of FAR) and LTI-2 (75% of FAR).
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7. STI granted in FY22 vested after the end of FY22
Table 3 Summary of FY22 STI KPIs (performance period 1 July 2021 to 30 June 2022)
76
The STI is designed to reward high-performing
employees for achievement of a balanced scorecard
of financial and non-financial Company performance
measures.
engagement, feelings of job satisfaction
and retention, which together contribute
significantly to the safety of our workplaces.
65% is regarded as a strong outcome.
The bullet points below summarise the key features
of the FY22 STI granted to the Executive KMP,
that was subject to a one-year performance period
measured at 30 June 2022.
Table 3 sets out the performance metrics, relative
weightings and performance outcome for the FY22
STI.
The Board resolved on 31 July 2022 that vesting
occurred. The total FY22 STI achievement for
the Executive KMP was 52.4%. The number of
Performance Rights granted to the Executive KMP,
and the proportion that vested and that lapsed, is
shown in Table 4 overpage.
• STI opportunity was calculated as a percentage
of FAR.
• Maximum opportunity was 100% of FAR for
the Managing Director & CEO and the Chief
Operating Officer, and 75% of FAR for the other
Executive KMP.
• 100% of the FY22 STI was weighted towards
Company wide performance metrics (with no
individual strategic measures).
• One-year performance period (1 July 2021 to 30
June 2022).
• Settled 50% in cash and 50% in Performance
Rights. The Executive KMP could elect at the
time of offer to have the FY22 STI settled 100%
in Performance Rights.
- Nil community, heritage or environmental
incidents – we act responsibly in our
environmental and social business practices;
we believe this supports the creation of
strong economic returns for our shareholders,
and shared value for our stakeholders.
The Bureau Veritas assurance statement
encompassed heritage and environmental
incident data (GRI 307-1 and GRI 411-1).
- Production Performance – Our production
is directly related to the financial returns we
generate for our shareholders.
- Financial Management – disciplined and
efficient use of capital and operational
expenditure is key to maintaining control over
costs.
• See page 100 for a summary of the FY20 Share
Plan under which the FY22 STI was granted.
exercise of discretion
On recommendation from the Remuneration
Committee, the Board resolved to exercise
discretion with respect to the Financial Management
KPI (carrying a 30% weighting) due to abnormal
inflationary costs. The actual AISC cost was
A$1,633/oz. Board discretion reduced this to
A$1,555/oz. In exercising discretion, reliance was
placed on third party analysis that identified five
significant abnormal cost inflations which were
materially outside the control of management:
• The Board retains discretion to adjust the STI
• significant fuel cost increases;
vesting awarded.
• The following performance measures applied to
the FY22 STI:
- Total Reportable Injury Frequency Rate
(TRIFR) – this is a measure of how many
restricted work injuries (RWIs)10 and lost time
injuries (LTIs)11 occur per million hours worked
by our employees and contractors. The
safety of our employees is key to our success
and in sustaining long term operational
performance.
- Employee Culture – a healthy constructive
culture underpins and promotes employee
• material foreign exchange impacts (at Pogo
a weaker Australian dollar had the effect of
increasing USD costs for the Group);
• wage costs associated with bonus payments to
operational staff for overtime shifts required to
minimise the impact of staff shortages due to
COVID-19;
• flight costs associated with increased fuel costs;
and
• the prices of reagents and steel grinding media.
10. RWI is a work injury that results in the injured person being unable to fully perform their ordinary occupation any time after the day or shift on which the
injury occurred regardless of whether they are rostered to work, or where alternative/light duties are performed or hours restricted.
11. LTI is a work injury that results in an absence from work for at least one full day or shift any time after the day or shift on which the injury occurred.
KPIs
Measure
Metric
Weighting Outcome
%
achieved
Total
Reportable
Injury
Frequency
Rate12
Threshold TRIFR <5.6 (FY21) = 10%
Target < 5.3 = 15%
Stretch TRIFR <5.0 = 20%
Linear pro rata between
20%
TRIFR 2.0
20%
Employee
Environment
Social
Governance
(30%)
Employee
Culture
Survey
Benchmark
Threshold Perform Culture Survey
STARR+E > 65% Northern Star
Group employees
5%
Environmental
& Social
Nil materially adverse community,
heritage or environmental incidents
5%
Employee
survey
participation
86%
Engagement
score 68%
Nil material
adverse
incidents
5%
5%
Production
Performance
(40%)
Gold Sales
within stated
guidance
Threshold: 1,550 koz = 0%
Target: 1,600 koz = 50%
Stretch: 1,650 koz = 100%
Pro rata vesting in between
Financial
Management
(30%)
AISC within
stated
guidance
Threshold: A$1,575/oz = 50%
Target: A$1,525/oz = 75%
Stretch: A$1,475/oz = 100%
Pro rata vesting in between
TOTAL
Table 4 FY22 STI outcome13 (vested at 31 July 2022)
40%
Gold Sales
1,560,958
ounces
4.4%
30%
100%
AISC
A$1,555 per
ounce
18%
77
52.4%
Executive KMP14
STI Performance
Rights awarded
Total STI
achieved15
STI
Performance
Rights vested
Percentage of
STI lapsed
STI
Performance
Rights lapsed
Stuart Tonkin
164,88816
52.4%
86,401
47.6%
78,487
Simon Jessop
42,43417
52.4%
22,235
47.6%
20,199
Ryan Gurner
50,92118
52.4%
26,682
47.6%
24,239
Hilary Macdonald
45,46519
52.4%
23,823
47.6%
21,642
12. No fatality gateway for vesting.
13. In 100% Performance Rights, or 50% Performance Rights and 50% cash (at the participant’s election).
14. Former Executive KMP, Bill Beament, Raleigh Finlayson and Morgan Ball, did not receive a FY22 STI grant.
15. Percentage of STI achieved with reference to the target, not stretch, number of Performance Rights.
16. Stuart Tonkin elected 100% of his FY22 STI to be delivered in Performance Rights.
17. Simon Jessop did not make an election for 100% of his FY22 STI to be delivered in Performance Rights.
18. Ryan Gurner elected 100% of his FY22 STI to be delivered in Performance Rights.
19. Hilary Macdonald elected 100% of her FY22 STI to be delivered in Performance Rights.
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8. LTI granted in FY20 vested after the end of FY22
Table 5 Summary of FY20 LTI KPIs (performance period 1 July 2019 to 30 June 2022)
as the gold price. The VanEck Vectors Gold
Miners ETF (GDX) was chosen at the time
of grant over other indices/peer groups to
best reflect the competitive landscape the
Company operates in, comprising all the
major and mid cap gold producers globally,
with whom the Company competes for
assets, people and investment capital.
- Ore Reserves maintenance – Encourages
replacement of Reserves depleted through
mining, resulting in an extended mine life.
- Ore Reserves growth – Encourages extension
of mine life involving considerable effort to
build Reserves in addition to replacement
of Reserves depleted through mining.
Compound annual Reserves growth of this
magnitude year on year is an extremely
challenging metric.
- Production – Encourages focus on a
particular operation to ensure production
growth is achieved on a sustainable basis.
• See page 100 for a summary of the FY20 Share
Plan under which the FY20 LTI was granted.
There was no exercise of discretion in relation to the
FY20 LTI measurement and outcome.
exercise of discretion
The invitations provided that a 12 month holding
lock would apply from 30 June 2022, to half of the
Shares resulting from exercise of vested FY20 LTI
Performance Rights. On 26 August 2022, the Board
exercised discretion to remove the holding lock on
the basis that it:
• allows recipients an opportunity to manage their
tax obligations; and
•
is of no material consequence to the business
from a retention perspective, because there is
no service condition associated with the holding
lock period.
78
The LTI granted to the Executive KMP focuses the
senior leadership team on drivers of shareholder
value over a period of three years. Performance
metrics are selected to reward both KMP and
shareholders for strong and sustained long term
performance.
The bullet points below summarise the key features
of the FY20 LTI granted to the Executive KMP, that
was subject to a three year performance period
which was measured at 30 June 2022.
The Board resolved on 31 July 2022 that vesting
occurred. The total FY20 LTI achievement for
the Executive KMP was 35%. The number of
Performance Rights granted to the Executive KMP,
and the proportion that vested and that lapsed, is
shown in Table 6 overpage.
Key features of the FY20 LTI grant:
• LTI opportunity was calculated as a percentage
of FAR.
• Maximum opportunity was 300% of FAR for the
former Executive Chair, 200% for the Managing
Director & CEO20 and between 75% and 100% of
FAR for other Executive KMP.
• All performance metrics are related to Company
performance.
• Three-year performance period (1 July 2019 to
30 June 2022).
• Settled 100% in Performance Rights.
• The Board retains discretion to adjust the LTI
vesting awarded.
• The following performance measures applied to
the FY20 LTI:
- ROIC – Return on Invested Capital was
considered at the time of grant to be an
appropriate measure for assessing business
performance, as it gives a sense of how well
the Company uses its money to generate
returns.
- TSR – Relative Total Shareholder Return is
preferred to Absolute TSR which can be
materially impacted by external factors such
20. Stuart Tonkin was Chief Executive Officer at the time of grant of FY20 LTI.
KPIs
Measure
Metric
Weighting
Outcome
% achieved
Financial –
Return on
Invested Capital
(ROIC) (25%)
ROIC is calculated
as 3 years’ NPAT
divided by the
average invested
capital for the 3 year
performance period21
Threshold <15% = 0%
Target 15% = 50%
Stretch ≥20% = 100%
Pro rata vesting
between >15% to <20%
Financial –
Relative Total
Shareholder
Return (TSR)
(50%)
Relative TSR
measured against the
VanEck Vectors Gold
Miners ETF (GDX)22
Threshold 10% CAGR per Share
6.25%
27.2% CAGR per
share
6.25%
Production growth
with annualised
sustainable
production run rate
Pogo to achieve 300Koz
run rate for at least one
quarter & forms the
FY23 guidance
TOTAL
Table 6 FY20 LTI outcome (vested at 31 July 2022)
Pogo run rate
hurdle not met
in any quarter &
FY23 guidance
below 300Koz
12.5%
100%
0%
35%
79
Executive
KMP23
LTI Performance
Rights awarded
Total LTI
achieved
LTI Performance
Rights vested
Percentage of
LTI lapsed
LTI Performance
Rights lapsed
Stuart
Tonkin
Ryan
Gurner
Hilary
Macdonald
Former
Executive
KMP24
Bill
Beament25
175,967
39,299
29,474
35%
35%
35%
61,588
13,754
10,315
65%
65%
65%
114,379
25,545
19,159
LTI Performance
Rights awarded
Total LTI
achieved
LTI Performance
Rights vested
Percentage of
LTI lapsed
LTI Performance
Rights lapsed
388,367
35%
135,928
65%
252,439
21. ROIC was calculated using underlying profit rather than statutory profit, consistent with the approach to reporting profit disclosed in the FY21 Annual
Report as appropriate given the merger of the Company with Saracen by scheme of arrangement implemented on 12 February 2021.
22. If the Company’s TSR performance is negative, but exceeds GDX, only 50% of this metric vests.
23. Simon Jessop was not a Northern Star employee at the time of grant of the FY20 LTI.
24. Raleigh Finlayson and Morgan Ball were not Northern Star employees at the time of grant of the FY20 LTI.
25. Bill Beament’s employment ended on 1 July 2021 as a result of Mr Beament’s decision to pursue other interests. The Board used its discretion to allow
Mr Beament to keep the 388,367 unvested FY20 LTI Performance Rights granted to him in November 2019.
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9. LTI granted in FY21 unvested at end of FY22
Table 7 Summary of FY21 LTI KPIs (performance period 1 July 2020 to 30 June 2023)
The FY21 LTI is due to be measured following the
end of the 3 year performance period, on 30 June
2023. The KPIs applicable to the FY21 LTI granted to
the Executive KMP are set out in Table 7 overpage.
The number of FY21 LTI Performance Rights granted
to the Executive KMP, and the proportion lapsed (if
any), is set out in Table 8 overpage.
Key features of the FY21 LTI grant are as follows:
• Maximum opportunity is 300% of FAR for the
former Executive Chair, 200% for the Managing
Director & CEO26 and between 75% and 100% of
FAR for other Executive KMP.
• All performance metrics are related to Company
performance.
• Three-year performance period (1 July 2020 to
30 June 2023).
• A 12 month holding lock from 30 June 2023
applies over 50% of the vested Performance
Rights. A service condition also applies for that
holding lock period.
• Settled 100% in Performance Rights.
• The Board retains discretion to adjust the LTI
vesting awarded.
• See pages 100 to 101 for a summary of the FY20
Share Plan under which FY21 LTI was granted.
26. Stuart Tonkin was Chief Executive Officer at the time of grant of FY21 LTI.
80
Brendan Murphy on the Mt
Charlotte headframe KCGM,
Kalgoorlie Production Centre,
Western Australia
KPIs
Measure
Metric
Weighting
Financial –
Return on
Invested Capital
(ROIC)27
ROIC is calculated as 3 years’
average NPAT divided by the
average invested capital (i.e.
equity plus debt)
Financial –
Relative Total
Shareholder
Return (TSR)
Relative TSR is measured against
the VanEck Vectors Gold Miners
ETF (GDX)28
Threshold <10% = 0%
Target 10% = 50%
Stretch ≥20% = 100%
Pro rata vesting between 10% & 20%
Threshold 18% than GDX = 100%
Pro rata vesting for exceeding target
30%
40%
Ore Reserves are maintained
post-depletion over the three-
year performance period
Ore Reserves grown by 10%
per Share over the three-year
performance period
Strategic –
Mine Life
Extension
TOTAL
Table 8 FY21 LTI on issue
Satisfied by the end of year 3 = 100%
15%
Satisfied by the end of year 3 = 100%
15%
100%
Executive KMP
Stuart Tonkin
Simon Jessop29
Ryan Gurner
Hilary Macdonald
LTI Performance
Rights awarded
Percentage of
LTI lapsed
LTI Performance
Rights lapsed
177,073
14,756
36,890
26,284
0%
0%
0%
0%
Nil
Nil
Nil
Nil
Former Executive KMP30
LTI Performance
Rights awarded
Percentage of
LTI lapsed
LTI Performance
Rights lapsed
Bill Beament31
Raleigh Finlayson29
Morgan Ball29
309,878
68,862
14,756
66.7%
58.3%
100%
206,585
40,170
14,756
27. ROIC =
Average annual net profit after tax (NPAT) for the 3 year period (sum of NPAT divided by 3).
Average capital employed over the period (i.e. opening and closing capital employed divided by 2).
28. If the Company’s TSR performance is negative, but exceeds GDX, only 50% of this metric vests.
29. The quantum of FY21 LTI granted to ex-Saracen KMP who joined Northern Star on 12 February 2021 was reduced to 4/12 of their annual LTI opportunity,
as they were only FY21 KMP from 12 February to 30 June 2021. This applies only in relation to FY21.
30. FY21 LTI Performance Rights granted to former Executive KMP were forfeited due to their resignations during FY21.
31. FY21 LTI Performance Rights granted to Bill Beament were reduced by two thirds, to reflect that Mr Beament will have performed an executive role with
the Company for only one out of the three year performance period.
81
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10. LTIs granted in FY22 unvested at end of FY22
Table 10 Summary of FY22 LTIs KPIs (4-year and 3-year performance period)
82
Historically (as with the FY21 LTI summarised above),
the measurement period for the Company’s LTI
has been three years. In FY21, the Board resolved
to increase the measurement period to four years
commencing with the FY22 LTIs grant (identified
below as LTI-1), to be measured on 30 June 2025, in
order to increase management’s focus on long term
shareholder wealth creation and better align the LTIs
with the interests of shareholders.
To fill the consequent vesting gap in the third year,
a one-off LTI grant was made in FY22 at a reduced
75% of the annual quantum, with a three-year
performance period (identified below as LTI-2). The
LTI-2 grant does not represent a doubling up of LTI
rewards, as the quantum of the LTI-1 award was not
increased to account for the vesting gap in the third
year (it was not made as a ‘super grant’). Given the
reduction to 75% of the annual grant amount for
LTI-2, this represents a diminution in the awards
KMP would have received had the Board retained a
three year measurement period for LTIs. The one-off
LTI-2 grant was designed to ensure that KMP will
have a portion of LTI opportunity subject to vesting
in each year during the four year performance period
of LTI-1, which is an important factor in encouraging
Executive KMP retention in the context of the
competition for leadership talent in the current
market.
The FY22 LTIs are due to be measured:
• LTI-1 – at the end of the 4-year performance
period, on 30 June 2025; and
• LTI-2 – at the end of the 3-year performance
period, on 30 June 2024.
The KPIs applicable to the FY22 LTIs granted to the
Executive KMP are set out in Table 10 overpage.
The number of FY22 LTI Performance Rights granted
to the Executive KMP, and the proportion lapsed (if
any), is set out in Table 9 below.
Key features of the FY22 LTIs grant are as follows:
• Maximum LTI-1 opportunity is 200% of FAR for
the Managing Director & CEO and 100% of FAR
for other Executive KMP.
• Maximum LTI-2 opportunity is 150% of FAR for
the Managing Director & CEO and 75% of FAR
for other Executive KMP.
• All performance metrics are related to Company
performance.
• The relative weightings of each performance
measure differ between LTI-1 and LTI-2, as
considered appropriate by the Board (and as
recommended by the Remuneration Committee)
taking into account the Company's long term
strategic goals.
• Four year performance period applies to LTI-1
(1 July 2021 to 30 June 2025) – to further align
the KMP with long term outcomes.
• Three year performance period applies to LTI-2
(1 July 2021 to 30 June 2024) – to fill the vesting
gap created by moving from a three year to a
four year vesting scheme.
• Settled 100% in Performance Rights.
• Service condition requiring full time employment
applies during the performance period.
• The Board retains discretion to adjust the LTIs
vesting awarded.
• See pages 100 to 101 for a summary of the FY20
Share Plan under which the FY22 LTIs were
granted.
Table 9 FY22 LTI-1 and LTI-2 on issue (for measurement at 30 June 2025 and 30 June 2024,
respectively)
Executive KMP32
LTI-1 Performance
Rights awarded
LTI-2 Performance
Rights awarded
Percentage of
LTI-1 & LTI-2 lapsed
LTI-1 & LTI-2
Performance
Rights lapsed
Stuart Tonkin
329,776
247,332
Simon Jessop
Ryan Gurner
84,869
67,895
Hilary Macdonald
60,620
63,651
50,921
45,465
0%
0%
0%
0%
Nil
Nil
Nil
Nil
32. Former Executive KMP, Bill Beament, Raleigh Finlayson and Morgan Ball, did not receive FY22 LTI grants.
KPIs
Measure
Metric
Gateway RTSR < 50th percentile = 0% vest
Threshold RTSR = 50th percentile = 50% vest
Target RTSR > 75th percentile = 100% vest
Pro rata vesting on linear basis 50% to 100%
RTSR33 against
peer group34
(Australian and
international)
Relative
Total
Shareholder
Return
(RTSR)
Modifier: Where the RTSR performance is negative at the end of the performance
period, and RTSR performance is equal to or exceeds the Peer Group (as it stands at
the end measure point), the number of Performance Rights which may vest is 50% of
the number determined from the vesting scale above.
Gateway RTSR < Index = 0% vest
Threshold RTSR = Index = 50% vest
Weighting
LTI-1
(4yr)
LTI-2
(3yr)
35%
40%
RTSR against
the S&P/TSX
Global Gold
Index (GGI)
Target RTSR > 10% above Index (for LTI-1) = 100% vest
35%
40%
Target RTSR > 7.5% above Index (for LTI-2)= 100% vest
Pro rata vesting on linear basis 50% to 100%
Modifier: Where RTSR performance is negative at the end of the performance
period, and RTSR performance is equal to or exceeds S&P/TSX Global Gold Index
performance, the number of Performance Rights which may vest is 50% of the
number determined from the vesting scale above.
Reduce
absolute
carbon
emissions35
Reduce absolute carbon equivalent Scope 1 and Scope 2
Emissions from existing fixed asset levels:
LTI-1 – by 100,000t (CO2 equivalent) by end of FY25 on a
sustaining annualised basis
LTI-2 – by 50,000t (CO2 equivalent) by end of FY24 on a
sustaining annualised basis
Water
conservation
LTI-1 To reduce baseline usage on potable scheme water
sources (KCGM) by 10%
10%
8%
83
ESG metrics
Support
Indigenous
businesses
Safety
outcomes
LTI-2 Establish sustaining Indigenous Business Supply
contracts of $20Mpa by end of FY24
Reportable TRIFR (12 month moving average) prorated
between:
LTI-1 – 5.0 (50%) and 4.8 (100%)
LTI-2 – 5.2 (50%) and 5.0 (100%)
subject to a threshold gate of 10% below industry average
for metalliferous mining (surface and underground and
exploration), as reported by DMIRS for 2023-2024 for LTI- 1
and 2022-2023 for LTI-236
10%
6%
10%
6%
Service
condition
In addition to the KPIs described above, a service condition will apply – that is, subject to Board
discretion, the employee must continue to be employed by the Company on a full-time basis until 30
June 2025 for LTI-1 or 30 June 2024 for LTI-2.
Discretion
The Board retains discretion to adjust LTI outcome in the case of, but not limited to, a fatality.
TOTAL
100%
100%
On 16 February 2022 in the CY21 Sustainability Report, the Company announced its target to reduce absolute
Scope 1 and Scope 2 operational Emissions by 35% by 2030, from the 1 July 2020 baseline of 931ktCO2-e, down
to approximately 590kt CO2-e.
33. RTSR to be assessed in home currencies.
34. Peer group comprises Newcrest, Agnico Eagle, Kinross, Goldfields, AngloGold Ashanti, B2Gold, Endeavour, Evolution, Newmont, Barrick (Kirkland Lake no
longer included in the peer group as a result of its merger with Agnico Eagle in February 2022).
35. On 26 August 2022 when setting the FY23 LTI carbon emissions reduction metric, the Board resolved that the same principles should apply to the metric for the
“reduce absolute carbon emissions” measure in the FY22 LTI-1 and FY22 LTI-2 KPIs. Accordingly, the metric shown above for the FY22 LTIs KPIs should read
as follows: Demonstrate tangible, sustainable Scope 1 and 2 carbon Emissions Reductions of 50,000 tonnes CO2 equivalent and 100,00 tonnes CO2 equivalent,
between 1 July 2021 and 30 June 2024 and between 1 July 2021 and 30 June 2025, respectively, where 1 July 2021 represents business as usual baseline levels.
36. Company TRIFR at 30 June 2021 was 5.6 and the industry average was 6.2.
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FY23 executive KMP remuneration
11. executive KMP remuneration mix for FY23
There were no changes to Executive KMP base cash
salary, STI opportunity and LTI opportunity for FY23
(except that there was no equivalent one-off LTI-2
granted in FY23).
A high proportion of between 64% and 75% of
maximum remuneration opportunity remains
at risk, with a view to ensure there is a focus of
the Company’s strategy and further increasing
alignment with shareholders’ interests.
Figure 6 FY23 total remuneration opportunity mix for Executive KMP37,38
Stuart Tonkin
25%
25%
50%
Simon Jessop
33.3%
Ryan Gurner
Hilary Macdonald
36.4%
36.4%
33.3%
27.3%
27.3%
33.3%
36.4%
36.4%
Key
FAR
STI
LTI
12. FAr for FY23 compared to FY22
84
The FY23 base cash salary component of FAR for
executive KMP remains at the same level as FY22.
The KMP are subject to a Minimum Holding
Condition Policy, requiring the Managing Director
& CEO to maintain a minimum level of Shares or
vested performance rights ownership equal to
100% of FAR, and other Executive KMP equal
to 50% of FAR.
Table 11 FY23 Executive KMP Fixed Remuneration
Executive KMP
Role
FY22 FAR
FY23 FAR
Stuart Tonkin
Managing Director & CEO
$1,700,000
$1,700,000
Simon Jessop
Chief Operating Officer
$875,000
$875,000
Ryan Gurner
Chief Financial Officer
$700,000
$700,000
Hilary Macdonald
Chief Legal Officer
& Company Secretary
$625,000
$625,000
13. STI granted in FY23
The metrics chosen for the FY23 STI remain the
same as the FY22 STI, but adjustments were made
to the relative weightings to reflect an increased
focus on costs.
The number of performance rights granted is
calculated by multiplying a percentage of base
salary (see below) by the Northern Star share
price, being the volume weighted average price
37. These figures have been rounded. Figure 6 is a voluntary disclosure included in this Report to improve transparency around how Northern Star rewards
Executive KMP and has not been prepared in accordance with Australian Accounting Standards.
38. Stuart Tonkin FY23 maximum opportunity = FAR (100%), STI (100% of FAR) and LTI (200% of FAR).
Simon Jessop FY23 maximum opportunity = FAR (100%), STI (100% of FAR) and LTI (100% of FAR).
Ryan Gurner FY23 maximum opportunity = FAR (100%), STI (75% of FAR) and LTI (100% of FAR).
Hilary Macdonald FY23 maximum opportunity = FAR (100%), STI (75% of FAR) and LTI (100% of FAR).
of Northern Star shares traded on the ASX in the
5 trading days prior to 1 July 2022, the start of the
performance period. The 5 day VWAP is $7.27. Using
a 5 day VWAP is aligned with peers (on a market
capitalisation basis).
Key features of the FY23 STI grant are:
• STI opportunity is calculated as a percentage of
FAR.
• Maximum FY23 STI opportunity is 100% of
FAR for the Managing Director & CEO and the
Chief Operating Officer, and 75% for the other
Executive KMP.
• 100% of the STI is weighted towards Company
wide performance metrics (with no individual
strategic measures).
• One year performance period applies to the
FY23 STI (1 July 2022 to 30 June 2023).
• Settled 50% in cash and 50% in Performance
Rights. Executive KMP can elect at the time
of offer to have the STI settled 100% in
Performance Rights.
• The following Company performance measures
were chosen for the FY23 STI, aimed at
delivering year-on-year positive impacts on the
Company's success and taking into account
investor feedback:
- The FY22 STI KPIs of ESG, production
performance and financial management
continue as the KPIs, but relative weightings
were adjusted in line with Company strategy
as shown below to maintain focus on costs;
and
-
In FY22 an outstanding TRIFR outcome of
2.0 was achieved. The safety component
of the FY23 ESG metric (TRIFR of 2.85 for
100% achievement) represents an extremely
challenging target given the industry
average of 5.7 and is designed to maintain
management's strong focus on the critical
issue of safety.
• The Board retains discretion to adjust the FY23
STI vesting awarded.
• See pages 100 to 101 for a summary of the FY20
Share Plan.
Table 12 below sets out the performance measures
and hurdles applicable to the FY23 STI granted to
the Executive KMP (in the case of the Managing
Director & CEO, subject to shareholder approval at
Annual General Meeting on 16 November 2022),
to be measured at the end of the 1-year performance
period on 30 June 2023.
Table 12 Summary of FY23 STI KPIs (performance period 1 July 2022 to 30 June 2023)
KPIs
Measure
Metric
FY23
Weighting
FY22
Weighting
Total Reportable
Injury Frequency
Rate39
Employee
Culture Survey
Benchmark
Threshold TRIFR (industry 5.7) = 50%
Target TRIFR 2.8540 = 100%
Pro rata vesting in between
Subject to a zero fatality gateway
Average score for “STARR Core Values”
greater than or equal to 65%
Minimum required participation rate
of 65% of all Northern Star Group
employees
20%
20%
2.5%
2.5%
5%
Environmental &
Social
Nil materially adverse community,
heritage or environmental incidents.
5%
5%
Gold sales within
stated guidance
AISC within
stated guidance
Threshold 1,560koz = 0%
Target 1,680koz = 100%
Pro rata vesting in between
Threshold A$1,690/oz = 0%
Target A$1,630/oz = 100%
Straight line vesting in between
50%
40%
20%
30%
100%
100%
Employee
Environmental
Social Governance
(30%)
Production
Performance
(50%)
Financial
Management
(20%)
TOTAL
39. 12 month moving average TRIFR.
40. TRIFR 2.85, being half of industry average benchmark TRIFR 5.7, from DMIRS Safety Performance in the Western Australian Mineral Industry - Accident
and Injury Statistics 2020-21 (surface and underground and exploration).
85
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14. LTI granted in FY23
Based on feedback from shareholders, there were
some minor changes to FY23 LTI grants.
The relative TSR (against peer group and against the
Global Gold Index) metrics and weighting chosen for
the FY23 LTI remain the same as the FY22 LTI-2, but
the ESG measure relates to an absolute reduction in
Scope 1 and 2 Emissions, only.
The number of performance rights granted is
calculated by multiplying a percentage of base
salary (see below) by the Northern Star share
price, being the volume weighted average price
of Northern Star shares traded on the ASX in the
5 trading days prior to 1 July 2022, the start of the
performance period. The 5 day VWAP is $7.27. Using
a 5 day VWAP is aligned with peers (on a market
capitalisation basis).
Key features of the FY23 LTI grant are as follows:
• LTI opportunity is calculated as a percentage of
FAR.
• Maximum FY23 LTI opportunity is 200% of FAR
for the Managing Director & CEO, and 100% for
the other Executive KMP.
86
• All FY23 LTI performance metrics are related to
Company performance.
• Four year performance period applies to the
FY23 LTI (1 July 2022 to 30 June 2026).
• Settled 100% in Performance Rights.
• The following Company performance measures
were chosen for the FY23 LTI, linked to key
financial and non-financial drivers which are
expected to have significant short term and long
term impacts on the success of the Company:
-
two relative total shareholder return
(TSR) KPIs (40% weighting each) require
outperformance against a group of ASX
and international gold peers with whom the
-
Company may compete for inorganic growth
activity and for human capital, and the S&P/
TSX Global Gold Index; and
the ESG measure (20% weighting) requires
demonstration of tangible, sustainable Scope
1 and 2 carbon Emissions Reductions of
150,000 tonnes CO2 equivalent between 1
July 2021 and 30 June 2026 below business
as usual levels, where 1 July 2021 represents
business as usual baseline levels. The
150,000 t (CO2 Equivalent) is in the aggregate
and will take into account any reductions
achieved under the FY22 LTI-1 and FY22
LTI-2 KPIs by the end of FY24 and FY25,
respectively. This is a challenging metric
to incentivise consistent and sustainable
absolute Emissions Reductions, given the
50,000t reduction target by end of FY24
(in the FY22 LTI-2) and 100,000t reduction
target by end of FY25 (in the FY22 LTI-1).
• Service condition requiring full time employment
applies during the performance period.
• The Board retains discretion to adjust the FY23
LTI vesting awarded.
• See pages 100 to 101 for a summary of the FY20
Share Plan under which FY23 LTI is granted.
Table 13 overpage sets out the KPIs applicable to
the FY23 LTI to be granted to the Executive KMP (in
the case of the Managing Director & CEO, subject to
shareholder approval at the Annual General Meeting
on 16 November 2022), to be measured at the end
of the 4-year performance period on 30 June 2026.
The Executive KMP grants will occur following the
Annual General Meeting.
Table 13 Summary of FY23 LTI KPIs – 4 year performance period (1 July 2022 to 30 June 2026)
KPIs
Measure
Metric
Weighting
Relative Total
Shareholder
Return – peer
group (40%)
Relative Total
Shareholder
Return – Global
Gold Index (40%)
Environmental
Social
Governance
(20%)
Service condition
RTSR41 against peer
group42 (Australian
and international)
RTSR against the
S&P/TSX Global
Gold Index (GGI)
Reduce absolute
carbon emissions
Gateway RTSR < 50th percentile = 0% vest
Threshold RTSR = 50th percentile = 50% vest
Target RTSR > 75th percentile = 100% vest
Straight line vesting between 50% and 100%
Gateway RTSR < Index = 0% vest
Threshold RTSR = Index = 50% vest
Target RTSR >10% above Index = 100% vest
Straight line vesting between 50% and 100%
Demonstrate tangible, sustainable Scope 1 and 2
carbon Emissions Reductions of 150,000 tonnes CO2
equivalent between 1 July 2021 and 30 June 2026
below business as usual levels.43
40%
40%
20%
In addition to the KPIs described above, a service condition will apply – that is, subject to
Board discretion, the Employee must continue to be employed by the Company on a full time
basis until 30 June 2026.
Discretion
The Board retains discretion to adjust LTI outcome in the case of, but not limited to, a fatality.
TOTAL
100%
41. RTSR to be assessed in home currencies.
42. Peer group comprises Newmont Corporation, Barrick Gold Corporation, Newcrest Mining, Agnico Eagle Mines, Gold Fields Ltd, AngloGold Ashanti,
Kinross Gold, Endeavour Mining, Evolution Mining Ltd and B2Gold Corporation.
43. For the avoidance of doubt the 150,000 t (CO2 Equivalent) target for the FY23 LTI will take into account any aggregate reduction achieved under the FY22
LTI-2 and LTI-1 KPI by end of FY25. 1 July 2021 represents business as usual baseline levels.
87
Inspecting core samples, Pogo
Operations, Alaska USA
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
reMUNerATION rePOrT
Figure 7 Scope 1 & 2 Emissions Reduction targets
FY22 & FY23 Non-executive Director remuneration
50,000
50,000
50,000
↓35.0%
15. Non-executive Directors’ remuneration for FY22 and FY23
No changes were made to Non-Executive Director
remuneration for FY23, aside from the cessation of
the FY20 NED Share Plan. All FY23 NED fees will be
delivered in cash44. A summary of the fees payable
to the Company’s Non-Executive Directors in FY23
(and FY22) is provided in Table 14 below.
All the Non-Executive Directors including the
Chairman are subject to a Minimum Holding
Condition Policy, requiring them to maintain a
minimum level of share ownership of 100% of the
NED base fee of $190,000.
Statutory remuneration disclosures for Non-
Executive Directors for the current and previous
financial year are provided in Table 16, calculated
with reference to the Corporations Act and
Australian Accounting Standards, in Australian
dollars.
Table 14 Non-Executive Director FY22 and FY23 fees
01-Jul-21 30-Jun-22 30-Jun-23 30-Jun-24 30-Jun-25 30-Jun-26 30-Jun-27 30-Jun-28 30-Jun-29 30-Jun-30
Baseline
for LTI-KPIs
FY22
LTI-2 KPI
FY22
LTI-1 KPI
FY23
LTI KPI
2030 Target
Key
Emissions profile
Targeted reduction (t CO2-e)
Progress towards 2030 Target
88
Climate Targets Snapshot
35%
Target Reduction in absolute
Scope 1 and Scope 2 Emissions by 2030
(1 July 2020 baseline: 931ktCO2-e).
Demonstrate tangible, sustainable Scope 1 and
Scope 2 carbon Emissions Reductions of
50 kt CO2-e
between 1 July 2021 and 30 June 2024,
where 1 July 2021 represents business as
usual baseline levels.
Demonstrate tangible, sustainable Scope 1 and
Scope 2 carbon Emissions Reductions of
Demonstrate tangible, sustainable Scope 1 and
Scope 2 carbon Emissions Reductions of
100 kt CO2-e
between 1 July 2021 and 30 June 2025, where
1 July 2021 represents business as usual baseline
levels (includes 50 kt CO2-e by 30 June 2024).
150 kt CO2-e
between 1 July 2021 and 30 June 2026, where
1 July 2021 represents business as usual baseline
levels (includes 50 kt CO2-e by 30 June 2024 and
50 kt CO2-e by 30 June 2025).
Base fees
Chairman
Other Non-Executive Directors
Additional fees
Lead Independent Director45
Audit & Risk Committee
Environmental, Social &
Safety Committee
Exploration and Growth
Committee
Nomination Committee
People & Culture
Committee46
Chair
Member
Chair
Member
Chair
Member
Chair
Member
Chair
Member
FY22
FY23
$575,000
$190,000
$575,000
$190,000
$60,000
$50,000
$25,000
$40,000
$20,000
$30,000
$15,000
nil
nil
$50,000
$25,000
89
n/a
$50,000
$25,000
$40,000
$20,000
$30,000
$15,000
nil
nil
$50,000
$25,000
44. In FY22, some Non-Executive Directors could elect to receive a $50,000 portion of their NED base fee in NED Share Rights under the FY20 NED Share
Plan, the terms of which are summarised at pages 126 & 127 of the FY21 Annual Report available at https://www.nsrltd.com/investor-and-media/reports/
annual-reports.
45. Former Lead Independent Director, Anthony Kiernan, resigned on 18 November 2021. This role was discontinued from that date, in view of the Chairman’s
appointment on 1 July 2021 in a non-executive capacity. No Lead Independent Director fee was therefore set for FY23.
46. Formerly the Remuneration Committee; restructured from 1 July 2022.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Executive KMP
Stuart Tonkin
Managing Director & CEO
Simon Jessop50
Chief Operating Officer
Ryan Gurner51
Chief Financial Officer
Hilary Macdonald
Chief Legal Officer &
Company Secretary
90
Former Executive KMP
Bill Beament53
Former Executive Chair
Raleigh Finlayson54
Former Executive Director
Morgan Ball55
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Statutory remuneration disclosures
16. Statutory remuneration table – executive KMP
Table 15 FY21 and FY22 Executive KMP statutory remuneration disclosures
Name & role
Year
Cash salary
Other
benefits47
Movement
in leave
provisions48
Post-
employment
benefits49
STI cash payment
STI Performance
Rights
LTI Performance
Rights
Total ($)
Performance-
related (%)
Fixed remuneration ($)
Variable remuneration ($)
Total remuneration
2022
1,646,774
2021
1,175,000
5,916
7,814
163,487
25,000
55,323
25,000
-
-
899,183
867,745
2022
850,000
16,907
64,113
25,000
229,250
206,434
2021
220,760
1,424
13,306
9,604
95,301
-
2022
337,836
13,471
39,997
12,500
2021
294,110
10,924
12,677
15,479
2022
600,000
13,507
80,764
25,000
-
-
-
2021
450,000
10,158
12,308
25,000
126,469
123,52152
167,897
221,179
138,551
1,934,597
4,674,957
613,087
222,268
14,469
172,111
80,326
279,416
93,552
2,743,969
1,613,971
354,864
699,436
581,413
1,219,866
856,038
2022
-
-
-
-
2021
1,375,000
381,924
(51,743)
25,000
2022
313,197
2021
527,904
2022
422,917
1,447
1,448
7,937
1,428
-
48,297
21,162
6,250
9,604
46,977
12,500
10,855
9,604
-
-
Former Chief Financial Officer
2021
220,760
Luke Creagh56
2022
-
-
-
-
212,023
-
90,969
-
-
-
-
756,534
1,689,525
4,176,240
-
-
-
-
-
155,712
74,968
-
14,469
-
524,903
847,109
490,330
348,085
-
Former Chief Operating Officer
2021
575,000
10,263
43,025
25,000
183,000
2,190,78957
159,541
3,186,618
TOTAL
2022
4,170,724
59,185
443,635
106,250
229,250
1,450,317
2,764,104
9,223,464
2021
4,838,534
425,383
116,913
144,291
707,762
4,121,516
2,739,937
13,094,336
47. ‘Other Benefits’ include telephone allowance, salary continuance insurance, private health insurance, D&O Insurance and parking.
48. Recognised in accordance with the Company's long service leave policy. Refer to Note 8(g) to the Financial Statements for further details. NST assumed
employee entitlements for Saracen employees on merger. Bill Beament’s, Morgan Ball’s and Raleigh Finlayson’s leave entitlements were paid out on
termination
49. Superannuation, which in FY22 is capped at $25,000 for each member of the Executive KMP.
50. Simon Jessop was appointed as Chief Operating Officer on 12 February 2021 on implementation of the merger with Saracen. Short-term incentive pro-
rated for the period of service with NST from 12 February 2021 to 30 June 2021.
51. Ryan Gurner ceased as Chief Financial Officer on 12 February 2021 on implementation of the merger with Saracen, and took on the Executive General
Manager Finance role for the remainder of FY21. Mr Gurner’s FY21 remuneration was pro-rated for the period from 1 July 2020 to 12 February 2021. Mr
Gurner was reappointed as Chief Financial Officer on 31 December 2021, when Morgan Ball resigned. Mr Gurner’s FY22 remuneration has been pro-rated
for the period 1 January 2022 to 31 June 2022.
52. Ryan Gurner elected to take 100% of his FY22 STI in Performance Rights (rather than 50% delivered in Performance Rights and 50% delivered in cash).
53. No remuneration for Bill Beament appears in Table 15 above, as Mr Beament resigned effective 1 July 2022 and was only an Executive KMP for 1 day
during FY22.
54. Raleigh Finlayson was appointed as Managing Director on 12 February 2021 on implementation of the merger with Saracen. His FY21 STI was pro-rated
for the period of service with NST from 12 February 2021 to 30 June 2021. Mr Finlayson resigned as a Director on 22 September 2021.
55. Morgan Ball was appointed as Chief Financial Officer on 12 February 2021 on implementation of the merger with Saracen. His FY21 STI was pro-rated for
the period of service with NST from 12 February 2021 to 30 June 2021. Mr Ball resigned on 31 December 2021.
56. Luke Creagh was not considered to fall within the definition of Key Management Personnel under AASB 124 Related Party Disclosures for FY22, hence nil
remuneration is disclosed for FY22. Mr Creagh remained employed by the Company throughout FY22, but has since resigned effective 1 July 2022.
57. Luke Creagh held 150,000 Restricted Shares that were subject to a holding lock until 1 July 2021 with a service condition, which vested in FY21.
91
61%
54%
41%
31%
42%
43%
41%
42%
-
59%
0%
34%
0%
30%
0%
17%
27%
43%
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
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17. Statutory remuneration table – Non-executive Directors
Table 16 FY21 and FY22 Non-Executive Directors statutory remuneration disclosures
Name & role
Year
Base fee58
Share Rights
Audit & Risk
Committee
Environmental
Social & Safety
Committee
Remuneration
Committee
Exploration
& Growth
Committee
Superannuation59
Total
Non-Executive Directors
Michael Chaney AO60
Chairman
John Fitzgerald
Non-Executive Director
Nicholas Cernotta
Non-Executive Director
John Richards61
Non-Executive Director
Sally Langer62
Non-Executive Director
Sharon Warburton63
Non-Executive Director
Former Non-Executive Directors
Anthony Kiernan64
Former Lead Independent Director
Mary Hackett
Non-Executive Director
Peter O’Connor66
Former Non-Executive Director
Shirley In’tVeld67
Former Non-Executive Director
TOTAL
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
569,108
-
127,273
136,660
130,455
114,155
190,000
62,268
172,796
60,862
148,258
-
87,796
75,383
118,273
105,15565
-
-
-
44,340
54,715
44,340
54,715
-
-
-
-
-
-
-
-
44,340
54,715
-
70,995
34,035
-
-
114,155
54,715
1,543,959
133,020
739,633
252,895
-
-
45,455
31,963
-
11,359
25,000
7,116
22,727
7,296
-
-
-
-
22,727
18,265
-
-
-
12,285
115,909
88,284
92
-
-
-
-
-
-
-
-
18,182
-
13,407
-
7,024
2,630
36,364
13,699
-
4,131
-
-
74,976
20,460
17,809
15,000
-
22,727
13,699
46,591
27,397
-
-
22,727
5,472
16,758
-
9,230
5,259
-
-
-
8,262
-
-
135,842
60,089
-
-
-
13,977
5,153
30,000
10,675
-
-
-
-
-
-
-
-
-
-
-
6,178
58,977
22,006
5,892
-
19,545
17,321
13,977
15,016
-
7,495
23,568
6,995
11,967
-
10,405
7,911
27,636
22,881
-
7,922
-
12,599
112,990
98,140
607,809
-
259,340
254,358
249,340
227,795
245,000
87,554
260,000
80,625
190,390
-
114,455
91,183
249,340
214,715
-
125,345
-
199,932
2,175,673
1,281,507
93
58. Base fee in this table includes the Lead Independent Director fee payable to John Fitzgerald until 12 February 2021 from which point Anthony Kiernan AM
was appointed Lead Independent Director until his resignation on 18 November 2021.
59. The Company pays superannuation to Directors in accordance with minimum superannuation guarantee obligations as required by Australian
superannuation law. Director’s base and Committee fees are calculated inclusive of superannuation. All fees in this table, to the extent paid in cash, are
shown net of any applicable superannuation paid, with any amounts remitted to a Director's superannuation fund shown separately. Where a Director
is eligible to elect for the Company to not remit superannuation on their behalf, and have been provided an appropriate exemption by the Australian
Taxation Office, the Company has paid the applicable amount of superannuation to the Director and included the amount in their relevant net fees. Some
Directors have been exempt from superannuation for the whole year, with others exempt for part year only or not at all.
60. Michael Chaney AO was appointed as Chairman on 1 July 2021.
61. John Richards joined the Board as a Non-Executive Director of the Company on 12 February 2021, on implementation of the merger with Saracen.
62. Sally Langer joined the Board as a Non-Executive Director of the Company on 12 February 2021, on implementation of the merger with Saracen.
63. Sharon Warburton was appointed as a Non-Executive Director on 1 September 2021.
64. Anthony Kiernan AM joined the Board as a Non-Executive Director of the Company on 12 February 2021 on implementation of the merger with Saracen.
Mr Kiernan AM resigned as a Director effective 18 November 2021.
65. Mary Hackett's FY21 base fee has been reduced by $9,000 from what was reported in the FY21 Annual Report, on the basis Ms Hackett's salary packaged
superannuation was incorrectly double counted (in base fee and superannuation). Ms Hackett's FY21 remuneration, and total FY21 NED remuneration, has
been updated in this table accordingly.
66. Peter O'Connor resigned as a Non-Executive Director of the Company on 12 February 2021, on implementation of the merger with Saracen.
67. Shirley In't Veld resigned as a Non-Executive Director of the Company on 30 June 2021.
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18. Allocation methodology for grant of FY22 STI & LTI Performance rights
19. Allocation methodology for grant of FY22 NeD Share rights
The quantum of LTI and STI Performance Rights
which were granted to the Executive KMP in FY22
was determined by dividing a percentage of their
respective FAR by the face value of Shares (90 day
VWAP prior to 1 July 2021 which was $10.31). The
percentage is set by the Board according to the
role performed and experience held by each of the
Executive KMP.
The maximum possible total value of the
Performance Rights is the assessed fair value at the
grant dates of the Performance Rights, calculated in
accordance with Australian Accounting Standards,
multiplied by the number of Performance Rights
granted.
Table 17 Fair value of unvested FY22 STI Performance Rights68 of Executive KMP at 30 June
2022 (vested at 31 July 2022)
Name
Performance
Rights
Fair value
per Right
Fair value of
Rights total
Performance
achieved
Rights
vested
Rights lapsed
/ forfeited
Executive KMP69
Stuart Tonkin
164,88870
10.41
1,715,989
52.4%
86,401
78,487
Simon Jessop
42,43471
9.28
393,957
52.4%
22,235
20,199
Ryan Gurner
50,92172
9.28
472,751
52.4%
26,682
24,239
Hilary Macdonald
45,46573
9.28
422,097
52.4%
23,823
21,642
94
Table 18 Fair value of unvested FY22 LTI-1 and LTI-2 Performance Rights74 of Executive KMP
at 30 June 2022
Previously, the Non-Executive Directors could
elect at the start of each financial year to receive
a $50,000 portion of their NED base fee in NED
Share Rights under the FY20 NED Share Plan
(subject to shareholder approval), the terms of
which are summarised at pages 126 & 127 of the
2021 Annual Report available at https://www.
nsrltd.com/investor-and-media/reports/annual-
reports. Prior to the end of FY21, John Fitzgerald,
Mary Hackett and Nick Cernotta each elected to
take NED Share Rights in lieu of $50,000 of their
FY22 NED base fee. Any grant of FY22 NED Share
Rights to the other Non-Executive Directors in lieu
of a $50,000 portion of their NED base fee would
have been subject to shareholder approval at the
Annual General Meeting held on 18 November 2021,
however it was decided not to seek such approval
and to cease awards of NED Share Rights. No FY23
NED Share Rights have been offered or granted; all
FY23 NED fees will be delivered in cash.
The quantum of NED Share Rights which were
granted to the Non-Executive Directors in FY22 was
determined by dividing the amount of $50,000 by
the face value of Shares (calculated as the 20 day
VWAP up to and including 30 June 2021, which was
$10.4678).
The maximum possible total value of the NED Share
Rights is the assessed fair value at the grant dates of
the NED Share Rights, calculated in accordance with
Australian Accounting Standards, multiplied by the
number of NED Share Rights granted.
The only vesting condition of the FY22 NED Share
Rights is that the individual remained a Non-
Executive Director of the Company on 30 June
2022, with pro rata reduction if the directorship
ended for any reason prior to 30 June 2022.
Table 19 Fair value of unvested FY22 NED Share Rights held by Non-Executive Directors
at 30 June 2022 (vested at 1 July 2022)
Name
NED Share
Rights
Fair value
per Right
Fair value of
Rights total
Service
Condition
satisfied
Rights
vested
Rights
lapsed /
forfeited
95
Non-Executive Directors
Name
Performance
Rights75
Fair value per
Right
Fair value of
Rights total
Rights vested
Rights lapsed /
forfeited
Michael Chaney AO
n/a
n/a
n/a
n/a
n/a
Executive KMP76
Stuart Tonkin
577,10877
Simon Jessop
148,52078
Ryan Gurner
118,81679
Hilary Macdonald
106,08580
7.48
6.68
6.68
6.68
4,315,379
991,532
793,226
708,232
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
68. FY22 STI Performance Rights grant date was 19 November 2021; measurement date was 30 June 2022.
69. Former Executive KMP, Bill Beament, Raleigh Finlayson and Morgan Ball, did not receive FY22 STIs.
70. Stuart Tonkin elected 100% of his FY22 STI to be delivered in Performance Rights.
71. Simon Jessop did not elect for 100% of his FY22 STI to be delivered in Performance Rights.
72. Ryan Gurner elected 100% of his FY22 STI to be delivered in Performance Rights.
73. Hilary Macdonald elected 100% of her FY22 STI to be delivered in Performance Rights.
74. FY22 LTI Performance Rights grant date was 19 November 2021; measurement date for LTI-1 is 30 June 2025 and measurement date for LTI-2 is
30 June 2024.
75. This column indicates the total FY22 LTI-1 and LTI-2 Performance Rights granted to Executive KMP, to be measured on 30 June 2025 and on
30 June 2024, respectively.
76. Former Executive KMP, Bill Beament, Raleigh Finlayson and Morgan Ball, did not receive FY22 LTIs.
77. Comprising 329,776 LTI-1 Performance Rights and 247,332 LTI-2 Performance Rights.
78. Comprising 84,869 LTI-1 Performance Rights and 63,651 LTI-2 Performance Rights.
79. Comprising 67,895 LTI-1 Performance Rights and 50,921 LTI-2 Performance Rights.
80. Comprising 60,620 LTI-1 Performance Rights and 45,465 LTI-2 Performance Rights.
John Fitzgerald
Nick Cernotta
John Richards
Sally Langer
Sharon Warburton
4,776
4,776
n/a
n/a
n/a
Former Non-Executive Directors
9.28
44,340
100%
9.28
44,340
100%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
4,776
4,776
n/a
n/a
n/a
Mary Hackett
4,776
9.28
44,340
100%
4,776
Anthony Kiernan
n/a
n/a
n/a
n/a
n/a
n/a
Nil
Nil
n/a
n/a
n/a
Nil
n/a
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Stuart Tonkin
1,025,000
58,43483
150,000
1,233,434
Hilary Macdonald
reMUNerATION rePOrT
reMUNerATION rePOrT
Table 21 Unvested Performance Rights held by the Executive KMP on 1 July 2021
and on 30 June 2022
Balance 1/7/2021
Balance 30/6/2022
20. Securities held by KMP during FY22
The following tables set out the Shares and Performance Rights held by the KMP at the start and end of
financial year ended 30 June 2021.
Table 20 Shares held by the KMP81 on 1 July 2021 and 30 June 2022 and changes
Balance 1/7/2021
or at date of
commencing as
KMP
Changes during FY22
Converted from
vested Rights82
Acquired / sold
on market
Balance 30/6/2022
or at date of ceasing
as KMP
Executive KMP
Simon Jessop84
236,51685
-
Ryan Gurner
13,365
38,26086
Hilary Macdonald
121,52587
Former Executive KMP
Bill Beament
5,906,11888
Raleigh Finlayson84
2,266,97890
Morgan Ball84
471,98092
96
Non-Executive Directors
Michael Chaney AO
25,000
John Fitzgerald
Nick Cernotta
John Richards
Sally Langer
Sharon Warburton
63,198
4,623
10,558
2,210
2,710
Former Non-Executive Directors
Mary Hackett
Anthony Kiernan
20,028
33,754
-
-
-
-
-
-
3,71293
-
-
-
-
-
-
-
(26,021)
-
100,000
(90,000)
-
-
-
10,000
11,460
5,360
-
-
236,516
51,625
95,504
5,906,11889
2,366,97891
381,980
25,000
63,198
8,335
20,558
13,670
8,070
20,028
33,75494
81. Including their close family members and entities controlled by them.
88. 976,001 were at 30 June 2021 subject to holding lock until the loan
No Shares are held nominally by any KMP.
82. Performance Rights in the case of Executive KMP, and NED Share
Rights in the case of Non-Executive Directors.
83. Exercise of vested FY21 STI Performance Rights.
84. Raleigh Finlayson, Morgan Ball and Simon Jessop agreed to holding
locks over a portion of their Northern Star shareholding acquired in
FY21 as a result of conversion of Saracen shares to Northern Star
Shares as the Scheme consideration for the merger implemented on 12
February 2021.
85. 5,880 were subject to holding lock until 30 June 2021; 22,049 were
subject to holding lock until 30 June 2022; and 31,750 are subject to
holding lock until 30 June 2023.
86. Exercise of vested FY17 LTI and FY21 STI Performance Rights.
87. 58,750 were subject to holding lock until 17 October 2021.
associated with these former vested FY15 and FY16 performance shares
was repaid. This loan was repaid in August 2021.
89. Nil changes reflected in this table, as Bill Beament ceased as KMP on 1
July 2021
90. 7,839 were subject to holding lock until 30 June 2021; 29,398 were
subject to holding lock until 30 June 2022; and 42,333 remain subject
to holding lock until 30 June 2023.
91. Balance held on resignation date 22 September 2021.
92. 5,880 were subject to holding lock until 30 June 2021; 22,049 were
subject to holding lock until 30 June 2022; and 31,750 are subject to
holding lock until 30 June 2023.
93. Exercise of vested FY21 NED Share Rights.
94. Balance held on resignation date 18 November 2021.
Table 22 NED Share Rights held by the Non-Executive Directors95 on 1 July 2021
and 30 June 2022
97
Balance 1/7/2021
Balance 30/6/2022
Executive KMP
Stuart Tonkin
Simon Jessop
Ryan Gurner
Former Executive KMP
Bill Beament
Raleigh Finlayson
Morgan Ball
TOTAL
Non-Executive Directors
Michael Chaney AO
John Fitzgerald
Nick Cernotta
John Richards
Sally Langer
Sharon Warburton
Mary Hackett
Anthony Kiernan
TOTAL
459,284
14,756
249,390
71,528
822,196
68,862
14,756
1,095,036
205,710
245,926
207,308
491,660
28,692
-
1,700,772
2,274,332
-
8,335
3,712
-
-
-
3,712
-
15,759
-
13,11196
4,77697
-
-
-
8,48898
-
26,375
95. Non-Executive Directors that commenced on 12 February 2021 and following that date did not receive a grant of FY21, FY22 or FY23 NED Share Rights –
see section 19 for further information.
96. Comprising 4,623 vested FY20 Share Rights, 3,712 vested FY21 Share Rights, and 4,776 vested FY22 Share Rights.
97. Comprising 3,712 vested FY21 Share Rights, and 4,776 vested FY22 Share Rights.
98. Comprising 3,712 vested FY21 Share Rights, and 4,776 vested FY22 Share Rights.
TOTAL
10,203,563
100,406
160,799
10,464,768
Former Non-Executive Directors
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
reMUNerATION rePOrT
21. Contractual Arrangements with executive KMP
The following contractual arrangements were in place with the Executive KMP for FY22.
Table 23 Contractual arrangements with Executive KMP
Element
Managing Director & CEO
(22 July 2021 to present)
Other Executive KMP
Contract duration
Notice period for termination by
the Company
Notice period for termination by
the employee
FAR
FY22 STI opportunity
• 100% Performance Rights
or
• 50% Performance Rights &
50% cash
FY22 LTI-1 opportunity
(4 year annual grant)
FY22 LTI-2 opportunity
(once off 3 year grant)
98
No fixed term, subject to
termination with or without cause
No fixed term, subject to
termination with or without cause
6 months
3 months
$1,700,000
100% of FAR
200% of FAR
150% of FAR
6 months
3 months
$625,000 to $875,000 – refer to
Table 11
75% to 100% of FAR – refer to
Figure 6 and Footnote 36
100% of FAR – refer to Figure 6 and
Footnote 36
75% of FAR – refer to Figure 6 and
Footnote 36
Shop front on Burt Street,
Kalgoorlie-Boulder
Martu Ranger, Ray Carbine on
route to Inspection area, Jundee
Operations, Yandal Production
Centre, Western Australia
99
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 reMUNerATION rePOrT
reMUNerATION rePOrT
Summary of FY20 Share Plan
Below is a summary of the FY20 Share Plan
approved by shareholders at the November 2020
Annual General Meeting. The Company issues long
term and short term incentives as Performance
Rights under this Plan, using a face value allocation
methodology.
Incentivising the Company’s high-performing team
is the essential link between senior management
remuneration, the Company’s performance and
delivery of long-term sustainable shareholder value.
1
Purpose
The main objectives of the Plan are to create a stronger link between performance
and longer-term remuneration outcomes for those who participate in the Plan
(Participants) and allow Participants to share in the future growth and profitability of
the Company.
2
Eligible Directors
Broadly, any full or part-time employee (including an executive director) of the
Company or a subsidiary (Group Employee) who has not given a notice of resignation
or been given a notice of termination of employment is eligible. Non-Executive
Directors are not eligible to participate.
3
Administration
of the Plan
The Plan is administered by the Remuneration Committee under the directions of the
Board. The Board may delegate its powers and discretions, determine procedures for
the administration of the Plan, and resolve questions of interpretation and disputes in
relation to the Plan.
4
Invitations
100
The Board may issue Invitations to Eligible Employees to be granted Awards under
the Plan. The terms and conditions in the Invitation will prevail to the extent of any
inconsistency with the FY20 Share Plan rules. For Group Employees, the measurable
objectives, the weighting amongst them and the performance periods during which
time they are required to be met, are set by the Board annually in relation to the
Executive KMP, and by the CEO annually in relation to other senior management
employees, for the short term incentives and long term incentives for each year in
which Awards are granted under the Plan.
5
6
7
8
9
Awards
Awards consist of grants of Performance Rights or other conditional rights to be
delivered a Share on the vesting of the Participant's Share Rights.
No Transfer
A Share Right may not be transferred without the prior written approval of the Board.
Vesting
Conditions
Awards are subject to Vesting Conditions. Vesting Conditions are determined by the
Board and described in the Invitation, and include performance conditions set by the
Board.
The Board may waive, replace or amend a Vesting Condition, for example, if the
Board determines that the original performance measure is no longer appropriate,
practical or applicable.
Vesting of Awards Awards will vest if and when the Board determines that the Vesting Conditions are
satisfied and the Participant is notified of this in writing.
Delivery of Shares
Following vesting of a Share Right, the Participant will be entitled to delivery of a
Share upon exercising the Share Right. Awards that vest are normally exercisable
up until the tenth anniversary of the date of grant of the Awards (although shorter
periods will apply if the Participant ceases to be employed).
The Board will determine how the Shares are to be delivered, which may be by issue
of new Shares to, purchase and transfer to, or procuring Shares to be held for the
benefit of (i.e. through the Company’s Employee Share Trust), the relevant Participant,
or a combination of such methods of delivery.
Alternatively, the Board may determine to settle in cash in lieu of delivering Shares.
The cash payment would be based on the volume weighted average price of Shares
in the 20 ASX trading days prior to the date of exercise.
10
Ranking of Shares Any Shares delivered to a Participant when an Award is exercised will rank equally
with all other issued Shares.
11
Restricted Shares
Invitations may specify that Shares delivered on vesting cannot be disposed of for a
specified period following delivery.
12
Termination
of employment
The Invitation will specify the consequences of cessation of employment during a
performance period, depending on the reasons, and subject to Board discretion.
For example, where employment ends because of agreed mutual separation, the
proportion of the unvested Share Rights which is the same as the proportion of the
relevant performance period during which the Participant was employed, may or may
not lapse according to Board discretion, and the balance of the Share Rights will lapse
on cessation, unless the Board exercises discretion otherwise.
13 Malus and
Clawback
The Board may reduce unvested Awards, and clawback previously vested Awards
from a Participant or former Participant within two years from the date of delivery of
Shares (or receipt of cash paid in lieu of delivering Shares). The Board may exercise
this power having regard to matters it considers relevant acting in good faith in the
interests of the Company, such as instances of:
• material financial misstatements;
• significant negligence;
• significant legal, regulatory and/or policy non-compliance;
• significant harmful act by the individual; or
• the Board holding the opinion that the Participant received or would receive a
grossly unjustifiable benefit because of factors outside the Participant’s control.
14 No participation
Share Rights do not entitle the holder to participate in a new issue of Shares or other
securities, or the right to any dividends or distributions paid on Shares.
101
15
Control
transactions
If a control event occurs:
a the proportion of the unvested Share Rights of each Participant which is the same
as the proportion of the relevant performance period that has expired before
the date of the control event (determined by the Board) will vest immediately
(regardless of the status of the Vesting Conditions, without limiting the Board’s
ability to exercise downward discretion if circumstances warrant this); and
b the balance of the Share Rights will vest or lapse on that date, as the Board
determines in its discretion.
A "control event" includes: a takeover bid where the bidder has acquired a relevant
interest in more than 50% of the Shares and either the Board has recommended the
bid or the bid has become unconditional; court approval of a scheme of arrangement
which will result in a person having a relevant interest in more than 50% of the Shares;
or another event which the Board declares to be a control event.
16
Amendment
The Board may amend the Plan. However, the Participant's consent is required
for amendments to the Plan that reduce the rights of the Participant in respect of
an Award that has already been granted (other than for legal reasons, correcting
manifest errors/mistakes or tax reasons).
17 Operation
The operation of the Plan is subject to the Company's Constitution, the Listing Rules,
the Corporations Act and other applicable laws.
18
Board Discretion
The Board retains absolute discretion to vary Awards or the application of the rules of
the Plan, and to exercise or refrain from exercising any power or discretion under the
FY20 Share Plan rules.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 AUDITOr'S INDePeNDeNCe DeCLArATION
Auditor's Independence Declaration
Section of the Super Pit,
KCGM, Kalgoorlie Production
Centre, Western Australia
102
103
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Financial
report
FINANCIAL rePOrT
FINANCIAL rePOrT
In this Financial report
1. Consolidated Statement of Profit or Loss and Other Comprehensive Income
2. Consolidated Statement of Financial Position
3. Consolidated Statement of Changes in Equity
4. Consolidated Statement of Cash Flows
5. Notes to the Consolidated Financial Statements
107
108
109
111
112
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 30 June 2022
Revenue
Cost of sales
Other income and expense
Space
Corporate, technical services and projects
Acquisition and integration costs
Impairment of assets
Finance costs
Gain on remeasurement of existing interest in KCGM
Profit before income tax
Income tax expense
Profit for the year
Other comprehensive income (OCI)
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Gains/ (losses) on cash flow hedges
Items that may not be reclassified to profit or loss
Income tax relating to these items
Changes in the fair value of financial assets at fair value through OCI
Other comprehensive income/ (loss) for the year, net of tax
Notes
4
6(a)
5
6(b)
6(c)
6(d)
13
7
30 June
2022
$M
3,735.4
(3,221.8)
513.6
297.4
(114.7)
(7.4)
(52.4)
(26.4)
-
610.1
(180.3)
429.8
36.4
(0.7)
1.7
(1.9)
35.5
30 June
2021
$M
2,760.5
(2,183.7)
576.8
(7.8)
(98.6)
(231.8)
(545.6)
(28.4)
1,919.3
1,583.9
(551.4)
1,032.5
(33.4)
0.4
1.9
26.1
(5.0)
106
Total comprehensive income for the year
465.3
1,027.5
107
Total comprehensive income for the year is attributable to:
Owners of the Company
465.3
1,027.5
Cents
Cents
Earnings per share for profit attributable to the ordinary equity holders of the
Company:
Basic earnings per share
Diluted earnings per share
23(a)
23(b)
37.0
36.8
114.7
114.3
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in
conjunction with the accompanying notes.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
As at 30 June 2022
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Current tax asset
Assets classified as held for sale
Total current assets
Non-current assets
Trade and other receivables
Inventories
Financial assets
Property, plant and equipment
Right of use asset
Exploration and evaluation assets
Mine properties
Intangible assets
Total non-current assets
Total assets
108
LIABILITIES
Current liabilities
Trade and other payables
Borrowings
Provisions
Lease Liabilities
Liabilities directly associated with assets classified as held for sale
Total current liabilities
Non-current liabilities
Borrowings
Provisions
Deferred tax liabilities
Trade and other payables
Lease Liabilities
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Share capital
Reserves
Retained earnings
Total equity
30 June
2022
$M
30 June
2021
$M
Notes
For the year ended 30
June 2022
Financial
assets at fair
value through
OCI
$M
Share
based
payments
reserve
$M
Foreign
currency
translation
reserve
$M
Cash flow
hedge
reserve
$M
Retained
earnings
$M
Total
equity
$M
Notes
Share capital
$M
8(b)
8(a)
9(f)
9(e)
15
8(a)
9(f)
8(c)
9(a)
9(b)
9(c)
9(d)
13
8(d)
8(e)
9(g)
9(b)
15
8(e)
9(g)
9(e)
8(d)
9(b)
571.1
155.0
679.2
24.0
-
1,429.3
4.9
264.3
185.0
2,052.6
137.8
653.5
6,319.8
83.8
9,701.7
771.9
122.0
583.9
155.9
204.3
1,838.0
0.9
404.3
23.8
1,544.9
138.5
609.3
6,684.1
5.6
9,411.4
11,131.0
11,249.4
339.5
70.3
316.2
50.3
-
776.3
297.9
654.7
1,094.2
-
93.0
2,139.8
296.5
36.4
316.5
50.1
65.3
764.8
709.8
779.1
925.3
0.1
91.8
2,506.1
2,916.1
3,270.9
8,214.9
7,978.5
10(a)
6,435.0
48.7
1,731.2
6,435.1
14.9
1,528.5
8,214.9
7,978.5
Balance at 1 July 2020
1,323.9
(14.8)
10.4
17.8
Profit for the year
Other comprehensive
income
Total comprehensive
income for the year
Transactions with
owners in their capacity
as owners:
Issue of ordinary shares
as part of Dividend
Reinvestment Plan
Dividends provided for
or paid
Employee share and
option plans - value of
employee services
Exercise of employee
share awards
Share plan loan
repayment
Tax
Balance at 30 June 2021
12(b)
-
-
-
5,104.6
-
2.4
3.9
-
0.3
5,111.2
6,435.1
-
28.0
28.0
-
-
-
-
-
-
-
13.2
-
-
-
-
-
10.6
(3.9)
0.3
(0.5)
6.5
16.9
-
(33.4)
(33.4)
-
-
-
-
-
-
806.5
2,143.8
1,032.5
1,032.5
0.4
-
(5.0)
0.4
1,032.5
1,027.5
-
-
-
-
-
5,104.6
(310.5)
(310.5)
-
-
13.0
-
-
-
-
(15.6)
-
-
-
0.4
-
-
(310.5)
1,528.5
0.3
(0.2)
4,807.2
7,978.5
109
Financial
assets at fair
value through
OCI
$M
Share
based
payments
reserve
$M
Foreign
currency
translation
reserve
$M
Cash flow
hedge
reserve
$M
Retained
earnings
$M
Total
equity
$M
Notes
Share capital
$M
Balance at 1 July 2021
6,435.1
13.2
16.9
(15.6)
0.4
1,528.5
7,978.5
Profit for the year
Other comprehensive
income
Total comprehensive
income for the year
-
-
-
-
(0.2)
(0.2)
-
-
-
-
36.4
36.4
-
429.8
429.8
(0.7)
-
35.5
(0.7)
429.8
465.3
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying
notes.
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying
notes.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Consolidated Statement of Changes in Equity
Financial
assets at fair
value through
OCI
$M
Share
based
payments
reserve
$M
Foreign
currency
translation
reserve
$M
Cash flow
hedge
reserve
$M
Retained
earnings
$M
Total
equity
$M
Notes
Share capital
$M
Transactions with
owners in their
capacity as owners:
Issue of ordinary shares
as part of Dividend
Reinvestment Plan
Treasury shares
Dividends provided for
or paid
Employee share and
option plans - value of
employee services
Exercise of employee
share awards
Share plan loan
repayment
Tax
10(a)
10(a)
12(b)
8.8
(18.2)
-
-
6.8
2.0
0.5
(0.1)
-
-
-
-
-
-
-
-
Balance at 30 June
2022
Nature and purposes of reserves:
6,435.0
13.0
-
-
-
9.4
(6.8)
(1.3)
(3.0)
(1.7)
15.2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
8.8
(18.2)
(227.1)
(227.1)
-
-
9.4
-
-
-
(227.1)
0.7
(2.5)
(228.9)
20.8
(0.3)
1,731.2
8,214.9
Financial assets at FVOCI
The Group has elected to recognise changes in the fair value of certain investments in equity securities in OCI. These
changes are accumulated within the FVOCI reserve within equity as described at note Investments and other
financial assets The Group transfers amounts from this reserve to retained earnings when the relevant equity
securities are derecognised.
110
Share based payments
The share based payments reserve relates to shares, performance shares, performance rights and share options
granted by the Company to its employees. Further information about share based payments to employees is set out
in note 21.
The increase in share based payment reserve and expense for services rendered by employees during the period is
determined with reference to the grant date fair value of the applicable award. The tax benefit, where available, in
respect of those awards is made with reference to the share price at the time the underlying shares are acquired or
issued by the Group to satisfy those awards. Where the tax benefit available is in excess of the tax effect on the
cumulative charge to profit and loss, the remaining credit is determined to relate to the equity issue and is included
within the share based payment reserve. Amounts recorded in the share based payment reserve are reclassified to
contributed equity on vesting of the performance rights. During FY22, $0.5 million (2021: $0.3 million) was transferred
from the share based payment reserve to contributed equity in relation to tax benefits on respective awards.
Foreign currency translation
Exchange differences arising on translation of the foreign controlled entities are recognised in other comprehensive
income and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss
when the net investment is disposed of.
Cash flow hedge reserve
The cash flow hedge reserve is used to recognise the effective portion of gains or losses on derivatives that are
designated and qualify as cash flow hedges.
Consolidated Statement of Cash Flows
For the year ended 30 June 2022
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Payment for merger and acquisition related costs
Interest received
Interest paid
Income taxes refunded/(paid)
Net cash inflow from operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Payments for exploration and evaluation
Payments for mine properties
Payments for investments
Payments for acquisition of business and associated assets, net of cash
acquired
Payments for asset acquisitions, net of cash acquired
Proceeds from disposal of business
Proceeds from sale of financial assets at fair value through other
comprehensive income
Lease receipt
Proceeds from disposal of assets
Other
Net cash outflow from investing activities
Cash flows from financing activities
Payments for issues of shares and other equity securities
Proceeds from borrowings
Repayments of equipment financing and leases
Repayment of borrowings
Dividends paid to Company's shareholders
Net cash outflow from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial period
Effects of exchange rate changes on cash and cash equivalents
Assets included in a disposal group classified as held for sale
Cash and cash equivalents at end of year
Notes
8(b)
13
14
12(b)
8(b)
30 June
2022
$M
3,695.0
(2,173.8)
(4.6)
5.3
(9.1)
86.4
1,599.2
(410.4)
(120.7)
(497.6)
(168.7)
(98.0)
(15.0)
401.9
10.4
-
16.8
-
(881.3)
(19.4)
300.0
(128.2)
(861.5)
(218.3)
(927.4)
(209.5)
771.9
8.7
-
571.1
30 June
2021
$M
2,726.0
(1,421.6)
(72.6)
2.7
(16.8)
(140.9)
1,076.8
(196.3)
(145.5)
(351.3)
(0.9)
402.5
(11.9)
-
31.3
4.2
4.3
6.5
(257.1)
(2.2)
658.0
(80.9)
(983.0)
(310.5)
(718.6)
101.1
677.3
(3.2)
(3.3)
771.9
111
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying
notes.
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Contents of the notes to the consolidated financial statements
1. Critical estimates and judgements
2. Segment information
how numbers are calculated
3. Significant changes in the current reporting period
112
4. Revenue
5. Other income and expense items
6. Expenses
7.
Income tax expense
8. Financial assets and financial liabilities
9. Non-financial assets and liabilities
10. Equity
risk
11. Financial risk management
12. Capital management
Group structure
13. Business combination
14. Sale of business
15. Assets classified as held for sale
16. Interests in other entities
Other information
17. Contingent liabilities
18. Commitments
19. Events occurring after the reporting period
20. Related party transactions
21. Share-based payments
22. Remuneration of auditors
23. Earnings per share
24. Deed of cross guarantee
25. Summary of significant accounting policies
26. Parent entity financial information
113
113
117
117
117
118
118
120
122
126
137
139
139
142
144
144
148
149
150
152
152
152
152
152
152
155
156
157
159
164
1 Critical estimates and judgements
(a) Critical accounting estimates and assumptions
(i) Determination of mineral resources and ore reserves
The Group reports its Mineral Resources and Ore Reserves in accordance with the Joint Ore Reserves Committee
(JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves - the JORC
Code. The information on Mineral Resources and Ore Reserves is prepared by Competent Persons as defined by the
JORC Code.
There are numerous uncertainties inherent in estimating Mineral Resources and Ore Reserves. Assumptions that are
valid at the time of estimation may change significantly when new information becomes available.
Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may change the
economic status of reserves and may, ultimately, result in the reserves being restated. Such changes may impact
asset carrying values, depreciation and amortisation rates, deferred development costs and provisions for
restoration.
Other critical accounting judgements, estimates and assumptions are discussed in the following notes:
Unit of production method of depreciation/amortisation
Exploration and evaluation expenditure
Business combinations
Mine rehabilitation provision
Impairment of assets
Life of component ratio for stripping asset
Share based payments
note 9(d)
note 9(c)
note 13
note 9(g)
note 6(c)
note 9(d)
note 21
2 Segment information
The Group's Executive Committee consisting of the Managing Director and Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer, Chief Technical Officer and Chief Geological Officer examine the Group's
performance and have identified seven reportable segments relating to the operations of the business:
(a) Description of segments and principal activities
The Group's reportable operating segments are:
1. Pogo, Alaska USA - Mining and processing of gold
2. Kalgoorlie Operations, WA Australia - Mining and processing of gold
3. KCGM, WA Australia - Mining and processing of gold
4. Jundee, WA Australia - Mining and processing of gold
5. Thunderbox, WA Australia - Mining and processing of gold
6. Carosue Dam, WA Australia - Mining and processing of gold
7. Exploration - Exploration and evaluation of gold mineralisation
An operating segment is a component of the Group that engages in business activities from which it may earn
revenues or incur expenses.
The Executive Committee has determined the Group to have seven operating segments (Kalgoorlie Operations,
Jundee, Pogo, KCGM, Thunderbox, Carosue Dam and Exploration). As in the prior year, Kanowna Belle, East
Kundana JV, Millennium and South Kalgoorlie is considered as one and has been presented as one reporting
segment (Kalgoorlie Operations). The East Kundana JV and Millennium operations were sold in the current period.
Refer to note 14(a) for more detail. The Exploration segment for the year ended 30 June 2022 includes Paulsens,
Western Tanami, Tanami, Talisman, Bundarra and the Bronzewing project. The Paulsens and Western Tanami projects
were sold in the current period. Refer to note 14(b) for more detail. Where related exploration assets are transferred
to mine properties from the exploration segment in the future, these will be incorporated into the relevant operating
segment.
113
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Segment information
(a) Description of segments and principal activities (continued)
Exploration comprises all projects in the exploration and evaluation phase of the Group. These include the Group's
regional prospects as well as ongoing exploration programmes at the Group’s respective sites.
Segment information
(b) Segment results
(c) Segment EBITDA
An analysis of segment revenues is presented in note 4.
(b) Segment results
The segment information for the year ended 30 June 2022 is as follows:
Kalgoorlie
Operations
$M
KCGM
$M
Carosue
Dam
$M
Pogo
$M
Jundee Thunderbox Exploration
$M
$M
$M
Segment EBITDA is a non-IFRS measure, being earnings before interest, tax, depreciation and amortisation and is
calculated as follows: profit before income tax plus depreciation, amortisation, impairment and finance costs, less
interest income.
Interest income, finance charges, interest expense and acquisition costs are not allocated to the operating
segments as this type of activity is driven by the corporate treasury function which manages the cash position of the
Group.
Segment EBITDA reconciles to profit before income tax for the year ended 30 June 2022 as follows:
Total
$M
77.1
70.0
(19.8)
33.1
327.8
11.3
(67.1)
432.4
356.3
-
6.9
440.3
94.8
-
1.5
166.3
276.9
-
1.5
258.6
130.9
-
2.2
166.2
123.5
-
2.0
453.3
117.0
-
1.3
129.6
1.9
52.4
0.7
(12.1)
1,101.3
52.4
16.1
1,602.2
Total segment assets
5,375.6
212.6
1,344.2
696.7
349.8
1,539.9
802.9
10,321.7
Total segment liabilities
(603.8)
(155.5)
(137.9)
(196.6)
(136.6)
(192.1)
(39.0)
(1,461.5)
(751.8) (10,462.4)
(1,464.9)
Pogo's revenue is generated from production activities located in the United States of America (USA). Its non-current
assets are also held in the USA. Total non-current assets for Pogo as at 30 June 2022 was A$598.2 million (2021:
A$567.2 million). All other segments are Australian.
(5,212.1)
(1,477.4)
(666.5)
(666.3)
(223.4)
114
The segment information for the year ended 30 June 2021 is as follows:
Kalgoorlie
Operations
$M
KCGM
$M
Carosue
Dam
$M
Pogo
$M
Jundee ThunderboxExploration
$M
$M
$M
Total
$M
2022
Segment net operating
profit/(loss) before income
tax
Depreciation and
amortisation
Impairment
Finance costs
Segment EBITDA
2021
Segment net
operating profit/(loss)
before income tax
Depreciation and
amortisation
Impairment
Finance costs
Fair value loss on
revaluation of
financial assets
Segment EBITDA
(393.7)
102.2
(19.6)
102.8
284.4
(8.2)
(142.3)
(74.4)
220.4
436.6
2.7
-
266.0
129.4
-
1.6
-
233.2
105.4
-
0.4
95.4
-
1.4
93.5
0.2
1.4
-
86.2
-
199.6
-
379.5
7.7
-
0.5
-
-
4.9
108.8
0.3
656.7
545.6
8.3
17.4
(10.9)
17.4
1,153.6
Segment assets
Unallocated:
Financial assets
Asset classified as held for sale
Cash and cash equivalents
Derivative financial instruments
Trade and other receivables
Current tax asset
Property, plant and equipment
Total assets as per the Consolidated Statement of Financial Position
Total segment assets
5,397.0
216.2
1,454.7
592.0
278.5
1,365.0
762.1
10,065.5
Total segment
liabilities
(523.6)
(150.5)
(151.5)
(179.9)
(139.2)
(148.6)
(63.5)
(1,356.8)
(5,139.4)
(298.9)
(1,389.4)
(611.7)
(518.8)
(1,216.4)
(687.7)
(9,862.3)
Investments in equity securities (classified as financial assets at fair value through OCI) and in associates held by the
Group are not considered to be segment assets as they are managed by the corporate treasury function.
(e) Segment liabilities
Reportable segments' liabilities are reconciled to total liabilities as follows:
30 June
2022
$M
30 June
2021
$M
10,321.7
10,065.5
184.3
-
481.3
-
87.6
24.0
32.1
11,131.0
23.2
204.3
718.3
0.5
73.0
155.9
8.6
11,249.3
Segment EBITDA
Other income and expense
Finance costs
Corporate and technical services
Share based payments
Gain on revaluation of existing interest in KCGM
Depreciation
Amortisation
Unwind of hedgebook contract liability
Acquisition costs
Impairment of assets
Profit before income tax
(d) Segment assets
30 June
2022
$M
1,602.2
297.4
(26.4)
(85.8)
(11.5)
-
(295.3)
(815.2)
4.5
(7.4)
(52.4)
610.1
30 June
2021
$M
1,153.6
(7.8)
(28.4)
(62.2)
(13.0)
1,919.3
(209.8)
(450.3)
59.9
(231.8)
(545.6)
1,583.9
115
Segment assets are measured in the same way as in the financial statements. These assets are allocated based on
the operations of the segment and the physical location of the asset.
Reportable segments' assets are reconciled to total assets as follows:
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Segment information
(e) Segment liabilities (continued)
Segment liabilities
Unallocated:
Trade and other payables
Borrowings
Provisions
Provisions - other
Deferred tax (net)
Derivative financial instruments
Liabilities attributable to assets held for sale
Total liabilities as per the Consolidated Statement of Financial Position
30 June
2022
$M
30 June
2021
$M
(1,461.5)
(1,356.8)
(16.4)
(98.7)
(12.3)
(233.0)
(1,094.2)
-
-
(2,916.1)
(15.4)
(659.2)
(11.2)
(232.5)
(925.3)
(5.1)
(65.3)
(3,270.8)
How numbers are calculated
This section provides additional information about those individual line items in the consolidated financial statements
that the Directors consider most relevant in the context of the operations of the entity, including:
(a) accounting policies that are relevant for an understanding of the items recognised in the financial statements.
These cover situations where the accounting standards either allow a choice or do not deal with a particular
type of transaction
(b) analysis and subtotals, including segment information, and
(c)
information about estimates and judgements made in relation to particular items.
3 Significant changes in the current reporting period
The financial position and performance of the Group was particularly affected by the following events and
transactions during the reporting period:
• Finalisation of the purchase price accounting for the merger with Saracen Mineral Holdings Limited.
• The purchase of Newmont Corporations Kalgoorlie power business. For details refer to note 13(a) of the financial
statements.
• The convertible debenture in Osisko. For details refer to note 8(c) of the financial statements
• The sale of the Kundana assets. For details refer to note 14(a) of the financial statements
• The sale of Paulsens and Western Tanami. For details refer to note 14(b) of the financial statements
4 Revenue
Accounting Policy
(i) Sale of goods
The Group primarily generates revenue from the sale of gold and silver bullion. The Group delivers dore bars to
refiners, who convert the product into investment grade bullion for a fee, which is subsequently sold either to the
refinery or third parties (financial institutions).
Revenue from the sale of these goods is recognised when control over the inventory has transferred to the customer.
116
Control is generally considered to have passed when:
117
• physical possession and inventory risk is transferred (including via a third-party transport provider arranged by the
refinery):
• payment terms for the sale of goods can be clearly identified through the sale of metal credits received or
receivable for the transfer of control of the asset;
• the Group can determine with sufficient accuracy the metal content of the goods delivered; and
• the refiner has no practical ability to reject the product where it is within contractually specified limits.
(ii) Sale of services
Tolling revenue is recognised as the tolling services are performed. The number of units processed is considered to
be the most direct measurement of value delivered to the customer under the contractual arrangements and
therefore tolling revenue is earned per tonne of ore processed.
The Group derives the following types of revenue:
Sale of gold
Sale of silver
Toll treatment
Total revenue
30 June
2022
$M
3,724.9
10.5
-
3,735.4
30 June
2021
$M
2,749.3
8.2
3.0
2,760.5
Sale of gold includes an amount of $4.5 million (2021: $59.9 million) in relation to hedge book liability unwind, which
has not been allocated to segments.
(a) Segment revenue
The total of revenue, broken down by operating segment, is shown in the following table. All revenue is from external
customers. No revenues are generated by the Exploration operating segment.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Revenue
(a) Segment revenue (continued)
KCGM
$M
1,179.3
731.0
2022
2021
Pogo
$M
522.8
474.6
Kalgoorlie
Operations
$M
425.0
590.2
Jundee
$M
755.7
660.1
Carosue Dam Thunderbox
$M
581.4
202.5
$M
266.7
42.2
Total
$M
3,730.9
2,700.6
5 Other income and expense items
Expenses
Depreciation methods, useful lives and residual values are reviewed at each reporting date. The useful lives of the
above assets is not expected to be significantly impacted by the Group's sustainability strategy, given its focus on
moving to electricity generated by renewables.
Royalties
Royalties under existing royalty regimes in Australia are payable on lodgement with the refining counterparty and
are recognised as the sale occurs. Production Royalties in Alaska are based on taxable profit and are consequently
treated as an income tax.
(b) Corporate, technical services and projects
Net gain/(loss) on disposal of property, plant and equipment
Interest income
Net foreign exchange gains/(losses)
Other*
Fair value loss on revaluation of assets classified as held for sale
Net gain on sale of investment in associate
Loss on extinguishment of KCGM contract
Gain on sale of subsidiary and assets **
30 June
2022
$M
30 June
2021
$M
(0.3)
6.0
7.7
5.5
-
-
(19.4)
297.9
297.4
(2.9)
2.5
(7.3)
8.7
(17.4)
8.6
-
-
(7.8)
* Other includes $0.8 million gain on remeasuring the Osisko convertible debenture to fair value at 30 June 2022.
** Gain of sale of subsidiary includes $242 million in regard to the sale of Kundana, and $56 million in regard to the
sale of Paulsens and Western Tanami. Refer to note 14 for further details.
6 Expenses
(a) Cost of sales
118
Mining
Processing
Site services
Employee benefit expenses
Depreciation
Amortisation
Government and other royalty expense
Change in inventories
30 June
2022
$M
790.4
583.8
89.8
491.4
290.5
815.2
90.1
70.6
3,221.8
30 June
2021
$M
480.8
392.0
75.2
405.5
202.8
449.0
62.5
115.9
2,183.7
Depreciation/amortisation method
Items of property, plant and equipment and mine properties are depreciated/amortised over their useful lives. The
Group uses the unit-of-production basis when depreciating/amortising mine specific assets which results in a
depreciation/amortisation charge proportional to the depletion of the anticipated remaining life of mine which is
referenced to the estimated economic reserve and resources of the property to which the assets relate. Each item’s
economic life, which is assessed annually has due regard to both its physical life limitations and to present
assessments of economically recoverable reserves and resources of the mine property at which it is located.
Depreciation of non-mine specific property, plant and equipment is calculated using the straight-line method to
allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives or, in the case of
leasehold improvements and certain leased plant and equipment, the shorter lease term as follows:
Land and buildings
Plant and equipment
•
•
• Motor Vehicles
• Office equipment
•
Intangible assets
5 - 20 years
2 - 20 years
4 - 10 years
2 - 10 years
20 years
Administration and technical services
Depreciation
Employee benefit expenses
Share based payments
Amortisation
Exploration projects
30 June
2022
$M
30 June
2021
$M
47.9
4.8
46.9
11.5
-
3.6
114.7
35.6
6.9
35.8
13.0
1.3
6.0
98.6
Accounting policy
Share-based compensation benefits are provided to employees via Option, Share and Performance Rights Plans as
discussed in note 21.
The fair value of shares and options granted under these Plans are recognised as a share based payments expense
with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair
value of the shares or options granted, which includes any market performance conditions and the impact of any
non-vesting conditions, but excludes the impact of any service and non-market performance vesting conditions.
Non-market vesting conditions are included in assumptions about the number of shares and options that are
expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the
specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the
number of shares and options that are expected to vest based on the non-market vesting conditions. It recognises
the impact of the revision to original estimates, if any, in profit or loss with a corresponding adjustment to equity.
119
(c) Impairment of assets
Exploration and evaluation assets (note 9(c))
Inventory
Property, plant and equipment
30 June
2022
$M
52.4
-
-
52.4
30 June
2021
$M
101.3
436.6
7.7
545.6
Prior Year - Inventory writedown KCGM mineralised waste
As part of the accounting for the merger with Saracen Minerals Holding Limited during the prior year, the Group
obtained control of KCGM. As outlined in note 13, this required the Group to identify and measure the assets
acquired at fair value, including the remeasurement of the Group’s existing 50 percent interest in the KCGM Joint
Operations. The stockpile reserves of KCGM at acquisition included 105 million tonnes of mineralised waste grading
0.68gpt containing an estimated 2.3 million ounces of gold. These proved reserves were considered to have fair
value to a willing buyer and have the ability to produce economic benefits through the potential to be processed
and recover saleable gold. The initial fair value at acquisition date was determined with reference to an estimate of
the stockpiles’ highest and best use and the most advantageous market from the perspective of market participants
at the time of the acquisition (given the absence of a principal market for low grading stockpile reserves). The initial
fair value ascribed to these stockpiles was $436 million.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Expenses
(c) Impairment of assets (continued)
Subsequent to acquisition, the Group measures inventory at the lower of cost and net realisable value. Net
realisable value is an entity specific value, whereas fair value is not entity specific, and these amounts may not
equal.
The Group’s post-merger strategy includes substantial investment in and development of the KCGM assets that
improve expectations that new higher-grade material will be added to mine plans in future periods, alternate ore
sources will become available over time and alternate regional processing strategies may be pursued that increase
uncertainty surrounding whether and/or when mineralised waste may be processed. Accordingly, the Group
considered it appropriate to write this inventory down to nil at 30 June 2021.
This assessment involves judgement, including, but not limited to: expectations surrounding whether and/or when
these stockpiles will be processed; the gold price environment in the future, which in turn may impact the
economics of processing low grade material; the identification of new resources and conversion of resources to
reserves and the development of KCGMs and other regional mine plans over time; changes in regional processing
strategies over time, including any changes in available processing capacity. Future changes in circumstances
surrounding whether and/or when this mineralised waste will be processed would need to be considered for reversal
of impairment at any such time.
(d) Finance costs
Interest expense
Provisions: unwinding of discount (note 9(g))
Finance charges
30 June
2022
$M
30 June
2021
$M
9.1
10.8
6.5
26.4
19.8
4.2
4.4
28.4
120
Provision - unwinding of discount
The Group records the present value of the estimated cost of legal and constructive obligations to rehabilitate
operating locations and decommission assets in the period in which the obligation is incurred. The unwinding of the
effect of discounting the provision is recorded as a finance charge in profit or loss.
7
Income tax expense
The income tax expense for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary
differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the
end of the reporting period in the countries where the Company’s subsidiaries operate and generate taxable
income. Management periodically evaluates positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of
amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred income
tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in
other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.
This note provides an analysis of the Group’s income tax expense, showing what amounts are recognised directly in
equity and how the tax expense is affected by non-assessable and non-deductible items. It explains significant
estimates made in relation to the Group's tax position.
Income tax expense
(a) Income tax expense
Current tax
Current tax on profits for the year
Other
Adjustments for current tax of prior periods
Total current tax
Deferred income tax
Decrease/(increase) in deferred tax assets (note 9(e))
Increase in deferred tax liabilities (note 9(e))
Total deferred tax expense
Income tax expense
(b) Tax reconciliation
Profit from continuing operations before income tax expense
Tax at the Australian tax rate of 30.0% (2021 - 30.0%)
Tax effect of amounts which are not deductible (taxable)
in calculating taxable income:
Sale of investments
Franking credit gross up
Stamp duty and transaction costs on Saracen merger
Sundry items
Adjustment for current tax of prior periods
Non-deductible amounts
Subtotal
Difference in overseas tax rates
Income tax expense
30 June
2022
$M
30 June
2021
$M
61.6
(1.7)
(16.2)
43.7
22.3
114.3
136.6
180.3
30 June
2022
$M
610.1
183.0
(0.2)
(0.1)
-
6.1
(16.2)
6.6
179.2
1.1
180.3
6.1
2.0
3.2
11.3
(87.5)
627.6
540.1
551.4
30 June
2021
$M
1,583.9
475.2
2.2
(0.1)
69.5
-
3.2
2.3
552.3
(0.9)
551.4
121
The tax rate for Australian Operations remains at 30%. The blended tax rate for Alaskan operations is 35.43%. The
Alaskan operations are subject to the following taxes: Federal (21%) and State Income Taxes (9.4%), Alaska Mining
Licence Tax (7%) and Alaska Production Royalty Tax (3%). The blended rate for Alaskan operations is not the sum of
the aforementioned rates due to the inter-relationship of deductibility of these taxes in determining taxable income
upon which the tax rates are levied.
(790.4)
(2,135.3)
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Income tax expense
Financial assets and financial liabilities
(c) Amounts recognised directly in equity
Aggregate current and deferred tax arising in the reporting year
and not recognised in net profit or loss or other comprehensive
income but directly debited or credited to equity:
Deferred tax: financial assets at fair value through OCI
Deferred tax: cost of share issue
Deferred tax: share based payments
Notes
9(e)
9(e)
30 June
2022
$'000
30 June
2021
$'000
(0.1)
-
0.2
0.1
0.1
1.4
1.0
2.5
8 Financial assets and financial liabilities
This note provides information about the Group's financial instruments, including:
•
•
•
•
an overview of all financial instruments held by the Group
specific information about each type of financial instrument
accounting policies
information about determining the fair value of the instruments, including judgements and estimation
uncertainty involved.
122
The Group holds the following financial instruments:
Financial assets
2022
Cash and cash equivalents
Trade and other receivables*
Derivative financial instruments
Financial assets at fair value through other
comprehensive income
2021
Cash and cash equivalents
Trade and other receivables*
Derivative financial instruments
Financial assets at fair value through other
comprehensive income
* Excluding prepayments and goods and services tax recoverable.
Notes
8(b)
8(a)
8(c)
8(b)
8(a)
8(c)
Assets at
FVOCI
$M
Assets at FVPL
$M
Financial
assets at
amortised cost
$M
-
-
-
15.0
15.0
-
-
-
23.2
23.2
-
-
169.3
-
169.3
-
-
0.5
-
0.5
571.1
88.4
-
-
659.5
771.9
42.1
-
-
814.0
Total
$M
571.1
88.4
169.3
15.0
843.8
771.9
42.1
0.5
23.2
837.7
Financial liabilities
2022
Trade and other payables**
Borrowings
Lease Liabilities
2021
Trade and other payables**
Borrowings
Lease Liabilities
** Excluding payroll tax and other statutory liabilities.
Liabilities at
amortised cost
$M
Notes
8(d)
8(e)
8(d)
8(e)
330.7
368.2
143.4
842.3
Liabilities at
amortised cost
$M
289.0
747.2
141.9
1,178.1
Total
$M
330.7
368.2
143.4
842.3
Total
$M
289.0
747.2
141.9
1,178.1
The Group’s exposure to various risks associated with the financial instruments is discussed in note 11. The maximum
exposure to credit risk at the end of the reporting period is the carrying amount of each class of financial assets
mentioned above.
(a) Trade and other receivables
Accounting policy
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the
effective interest method, less provision for impairment.
Trade receivables
Sundry debtors
Goods and services tax recoverable
Prepayments
30 June
2022
Non-
current
$M
-
4.9
-
-
4.9
Current
$M
58.2
25.3
27.4
44.1
155.0
30 June
2021
Non-
current
$M
-
-
-
0.9
0.9
Total
$M
58.2
30.2
27.4
44.1
159.9
Current
$M
25.3
16.8
25.3
54.6
122.0
Total
$M
25.3
16.8
25.3
55.5
122.9
123
(i) Classification as trade and other receivables
If collection of the amounts is expected in one year or less they are classified as current assets. If not, they are
presented as non-current assets. Trade receivables are generally due for settlement within 30 days and therefore are
all classified as current.
(ii)
Fair value of trade and other receivables
As the majority of receivables are short term in nature, their carrying amount is assumed to be the same as their fair
value.
(b) Cash and cash equivalents
Accounting policy
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term,
highly liquid investments with original maturities of three months or less that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of changes in value.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Financial assets and financial liabilities
(b) Cash and cash equivalents (continued)
Cash at bank and in hand
(i) Reconciliation to the statement of cash flows
Reconciliation of profit after tax to net cash flow from operating activities:
Profit for the year
Adjustment for
Depreciation and amortisation
Fair value adjustment to financial assets
Non-cash employee benefits expense - share-based payments
Rehabilitation provision - unwinding of discount
Net (gain)/ loss on sale of non-current assets
Impairment of assets during the period
Unwind of hedgebook contract liability
Share of losses of associates and joint ventures
Amortisation of upfront debt transaction costs
Net exchange differences
Loss on extinguishment of KCGM contract
Other non-cash
Gain on remeasurement of existing interest in KCGM
124
Change in operating assets and liabilities:
(Increase)/decrease in trade and other receivables
Decrease in inventories
Increase in trade and other payables
Increase/(decrease) in income taxes payable
Increase in deferred tax liabilities
Decrease in provisions
Net cash inflow from operating activities
(c) Financial Assets
Accounting policy
Financial assets are carried at fair value.
Financial Assets
Listed securities
Convertible Debenture
Other
30 June
2022
$M
30 June
2021
$M
571.1
771.9
30 June
2022
$M
30 June
2021
$M
429.8
1,032.5
1,110.5
(0.8)
11.5
10.8
(297.4)
52.4
(4.5)
-
1.1
(3.9)
19.4
1.6
-
(29.5)
50.8
38.4
81.6
133.7
(6.3)
1,599.2
660.0
16.0
13.0
4.2
2.9
545.6
(59.9)
1.5
5.2
-
-
-
(1,919.3)
37.4
126.8
201.9
(95.4)
544.7
(40.3)
1,076.8
30 June
2022
$M
30 June
2021
$M
15.0
169.3
0.7
185.0
22.3
-
1.5
23.8
Financial assets and financial liabilities
(c) Financial Assets (continued)
(i) Convertible Debentures
On 30 November 2021, the Group entered into a convertible debenture with Osisko Mining Inc. (OSK) with a face
value of C$154 million (A$168.9 million) and a final maturity date of 1 December 2025. The debenture accrues
interest half-yearly at a rate of 4.75% per annum.
The debenture also carries conversion rights. The Debenture may be converted by the Group at any time after the
first anniversary at a conversion price equal to C$4.00 per share of OSK. In addition, the Debenture may also be
redeemed by OSK at any time after the second anniversary for cash or shares in OSK (provided that the volume
weighted average trading price of the Common Shares are not less than 125% of the Conversion Price for the
twenty consecutive trading days ending five days prior to the notice of redemption).
The instrument is required to be carried at fair value through profit and loss in accordance with AASB 9 Financial
Instruments. As at 30 June 2022 the instrument was remeasured to a fair value of $169.3 million (2021: $0).
(d) Trade and other payables
Accounting policy
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually paid within 45 days of recognition. Trade and other
payables are presented as current liabilities unless payment is not due within 12 months from the reporting date.
They are recognised initially at their fair value and subsequently measured at amortised cost using the effective
interest method.
Trade payables
Accruals
Payroll tax and other statutory liabilities
Other payables
30 June
2022
$M
45.5
231.5
8.8
53.7
339.5
30 June
2021
$M
37.8
192.5
7.5
58.7
296.5
125
The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their
short-term nature.
(e) Borrowings
Accounting policy
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date or there is an expectation the Group will repay amounts within
the following 12 months. As at 30 June 2022, the entirety of the $97.5 million (net of capitalised borrowing costs)
drawn on the revolving credit facility is classified within non-current bank loans as it is not expected that this amount
will be repaid within 12 months ($100 million contractually repayable in June 2024).
30 June
2022
Non-
current
$M
Current
$M
-
70.3
70.3
97.5
200.4
297.9
30 June
2021
Non-
current
$M
Current
$M
0.3
36.1
36.4
658.0
51.8
709.8
Total
$M
97.5
270.7
368.2
Notes
8(e)(i)
8(e)(i)
Total
$M
658.3
87.9
746.2
Bank loans
Secured asset financing
Total secured borrowings
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Financial assets and financial liabilities
(e) Borrowings (continued)
Liabilities from financing activities reconciliation
30 June 2021
Opening liabilities from financing activities
Cash flows
New secured asset financing
Non-current assets/liabilities held for sale
Liabilities from financing activities at 30 June 2021
30 June 2022
Opening liabilities from financing activities
Cash flows
New secured asset financing
Unwind of capitalised borrowing costs
Foreign exchange effect on balance
Liabilities from financing activities at 30 June 2022
(i)
Secured asset financing
Borrowings
$M
Secured Asset
Financing
$M
697.3
(39.0)
-
-
658.3
658.3
(561.5)
-
0.7
-
97.5
65.1
(36.0)
75.4
(16.6)
87.9
87.9
(55.4)
228.5
-
9.7
270.7
Total
$M
762.4
(75.0)
75.4
(16.6)
746.2
746.2
(616.9)
228.5
0.7
9.7
368.2
126
Secured asset financing amounts are interest-bearing borrowings secured over Group owned plant and equipment.
The borrowings term are three to five years. The interest rates are either fixed or variable and payable from the
inception of the borrowings.
These liabilities are secured by assets classified as property, plant and equipment with a written down value of $258.3
million.
(ii)
Fair value
For the majority of the borrowings, the fair values are not materially different to their carrying amounts, since the
interest payable on those borrowings is either close to current market rates or the borrowings are of a short-term
nature. Refer above for differences as at year end.
(iii) Financing arrangements
As at the end of the report period, the Group had:
•
•
•
Revolving credit facility limit of $1 billion which is drawn to $100 million ($97.5 million net of capitalised finance
costs) at 30 June 2022;
$50 million contingent instrument facilities, drawn down by $32.3 million; and
US$77 million contingent instrument facilities, drawn down by US$73.2 million.
As at the end of the prior report period, the Group had:
•
•
•
Revolving credit facility limit of $1 billion which was drawn down to $662 million ($658 million net of capitalised
finance costs) at 30 June 2021;
$20 million contingent instrument facilities, drawn down by $8.8 million; and
US$77 million contingent instrument facilities, drawn down by US$73.1 million.
9 Non-financial assets and liabilities
This note provides information about the Group's non-financial assets and liabilities, including:
•
specific information about each type of non-financial asset and non-financial liability
-
-
property, plant and equipment
exploration and evaluation assets
Non-financial assets and liabilities
-
-
-
-
mine properties assets
tax balances
inventories
provisions
accounting policies
information about determining the fair value of the assets and liabilities, including judgements and
estimation uncertainty involved.
•
•
(a) Property, plant and equipment
Accounting policy
Property, plant and equipment is carried at historical cost less accumulated depreciation and impairment losses.
Refer to note 25 for further information on accounting policies associated with impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
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.
Land &
buildings
$M
Plant &
equipment
$M
Motor
Vehicles
$M
Office
equipment
$M
Capital work in
progress
$M
130.8
(23.1)
107.7
53.7
-
47.9
(2.7)
-
11.8
1,589.0
(318.1)
1,270.9
666.6
1.8
465.7
(25.4)
(7.0)
263.4
24.0
(9.8)
14.2
8.0
-
4.9
(0.2)
(0.4)
6.2
24.1
(8.2)
15.9
6.5
-
8.0
(0.3)
(0.1)
3.8
136.2
-
136.2
54.6
264.6
106.1
(2.6)
-
(285.2)
Total
$M
1,904.1
(359.2)
1,544.9
789.4
266.4
632.6
(31.2)
(7.5)
-
7.7
86.9
1.0
1.6
1.5
98.7
127
(1.0)
(9.2)
(0.5)
(24.7)
(149.3)
(7.1)
107.7
1,270.9
(1.2)
(4.1)
-
14.2
(0.3)
(3.2)
(0.1)
15.9
(2.8)
(30.0)
-
-
(165.8)
(7.7)
136.2
1,544.9
At 30 June 2021
Cost or fair value
Accumulated
depreciation
Net book amount
Year ended 30
June 2021
Opening net book
value
Additions
Acquisition of
subsidiary
Exchange
differences
Disposals
Transfers
Gain on
revaluation of
existing interest in
KCGM (note 13)
Assets included in
a disposal group
classified as held
for sale and other
disposals
Depreciation
charge
Impairment loss
Closing net book
amount
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Non-financial assets and liabilities
(a) Property, plant and equipment (continued)
Non-financial assets and liabilities
(b) Leases (continued)
Land &
buildings
$M
Plant &
equipment
$M
Motor
Vehicles
$M
Office
equipment
$M
Capital work in
progress
$M
At 30 June 2022
Cost or fair value
Accumulated
depreciation
Net book amount
Year ended 30
June 2022
Opening net book
value
Additions
Acquired as part
of asset acquisition
Exchange
differences
Disposals
Transfers
Depreciation
charge
Disposal per sale of
business
Closing net book
amount
(b) Leases
128
Accounting policy
173.6
(57.0)
116.6
107.7
-
1.1
2.8
21.1
(16.1)
-
2,094.0
(607.1)
1,486.9
1,270.9
-
41.9
27.5
(6.0)
368.9
(205.9)
(10.3)
116.6
1,486.9
34.2
(20.0)
14.2
28.6
(16.5)
12.1
14.2
-
-
0.3
(0.3)
6.1
(6.1)
-
14.2
15.8
-
0.1
0.3
(0.4)
2.0
(5.5)
(0.2)
12.1
Total
$M
2,753.2
(700.6)
2,052.6
1,544.9
682.2
43.1
33.3
(6.7)
-
(233.6)
(10.5)
422.8
-
422.8
136.3
682.2
-
2.4
-
(398.1)
-
-
422.8
2,052.6
AASB 16 Leases eliminates the distinction between operating and finance leases and brings all leases (other than
short term and low value leases) on to the balance sheet. As a lessee, the Group recognises a right-of-use asset
representing its right to use the underlying asset and a lease liability representing its obligation to make lease
payments.
An assessment is made, at inception or when contract terms are changed, to determine whether the contract is, or
contains, a lease. A contract is or contains a lease if the contract conveys a right to control the use of an identified
asset for a period of time in exchange for consideration.
The Group assesses whether a contract is or contains a lease, at inception of the contract. The Group recognises a
right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee,
except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets.
For these leases, the Group recognises the lease payments as an operating expense on a straight-line basis over the
term of the lease unless another systematic basis is more representative of the time pattern in which economic
benefits from the leased assets are consumed.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined,
the Group uses its incremental borrowing rate.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the
net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payment that are based on an index or a rate
• amounts expected to be payable by the lessee under residual value guarantees
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability
(using the effective interest method) and by reducing the carrying amount to reflect the lease payments made.
The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset)
whenever:
• The lease term has changed or there is a significant event or change in circumstances resulting in a change in the
assessment of exercise of a purchase option, in which case the lease liability is remeasured by discounting the
revised lease payments using a revised discount rate.
• The lease payments change due to changes in an index or rate or a change in expected payment under a
guaranteed residual value, in which case the lease liability is remeasured by discounting the revised lease payments
using an unchanged discount rate (unless the lease payments change is due to a change in a floating interest rate,
in which case a revised discount rate is used).
• Ale ase contract is modified and the lease modification is not accounted for as a separate lease, in which case
the lease liability is remeasured based on the lease term of the modified lease by discounting the revised lease
payments using a revised discount rate at the effective date of the modification.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at
or before the commencement day, less any lease incentives received and any initial direct costs. They are
subsequently measured at cost less accumulated depreciation and impairment losses.
Whenever the Group incurs an obligation for costs to dismantle and remove a leased asset, restore the site on which
it is located or restore the underlying asset to the condition required by the terms and conditions of the lease, a
provision is recognised and measured under AASB 137 Provisions, Contingent Liabilities and Contingent Assets. To the
extent that the costs relate to a right-of-use asset, the costs are included in the related right-of-use asset, unless those
costs are incurred to produce inventories.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects
to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying
asset. The depreciation starts at the commencement date of the lease.
129
The Group applies AASB 136 Impairment of Assets to determine whether a right-of-use asset is impaired and
accounts for any identified impairment loss as described in the ‘Property, Plant and Equipment’ policy (as outlined in
the financial report for the annual reporting period).
Variable rents that do not depend on an index or rate are not included in the measurement the lease liability and
the right-of-use asset. The related payments are recognised as an expense in the period in which the event or
condition that triggers those payments occurs and are included in profit or loss.
As a practical expedient, AASB 16 Leases permits a lessee not to separate non-lease components, and instead
account for any lease and associated non-lease components as a single arrangement. The Group has not used this
practical expedient. For a contracts that contain a lease component and one or more additional lease or
non-lease components, the Group allocates the consideration in the contract to each lease component on the
basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the
non-lease components.
Amounts recognised in the Consolidated Statement of Financial Position
The Consolidated Statement of Financial Position shows the following amounts relating to leases:
Right-of-use assets
Opening balance
Acquired as part of business combination (note 13)
Gain on revaluation of existing interest in KCGM (note 13)
Additions to right-of-use assets
Depreciation
Closing balance
Lease liabilities
Current
Non-current
Closing balance
30 June 2022
$M
138.5
-
-
64.4
(65.1)
137.8
30 June 2021
$M
44.9
103.9
1.2
29.0
(40.5)
138.5
$M
50.3
93.0
143.3
$M
50.1
91.8
141.9
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Non-financial assets and liabilities
(b) Leases (continued)
Future lease payments in relation to lease liabilities as at
period end are as follows:
Less than 6 months
6 -12 months
Between 1 and 2 years
Between 2 and 5 years
Over 5 years
(c) Exploration and evaluation assets
$M
28.2
22.6
45.3
50.7
2.9
149.8
$M
28.5
24.4
53.1
37.1
52.2
148.2
Accounting policy
Exploration and evaluation assets include the costs of acquiring licences, costs associated with exploration and
evaluation activity, and the fair value (at acquisition date) of exploration and evaluation assets acquired in a
business combination. Exploration and evaluation expenditure is capitalised on an area of interest basis. Costs
incurred before the Group has obtained the legal rights to explore an area are recognised in the statement of profit
or loss and other comprehensive income.
Exploration and evaluation assets are only recognised if the rights of the area of interest are current and either, the
expenditures are expected to be recouped through successful development and exploitation of the area of interest
or activities in the area of interest have not at the reporting date; reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves and active and significant
operations in, or in relation to, the area of interest are continuing.
Once a development decision has been made, all past exploration and evaluation expenditure in respect of an
area of interest that has been capitalised is transferred to mine properties where it is amortised over the life of the
area of interest to which it relates on a unit-of-production basis. No amortisation is charged during the exploration
and evaluation phase.
130
The application of the above accounting policy requires management to make certain estimates and assumptions
as to future events and circumstances, in particular, the assessment of whether economic quantities of reserves will
be found. Any such estimates and assumptions may change as new information becomes available, which may
require adjustments to the carrying value of assets. Capitalised exploration and evaluation expenditure is assessed
for impairment when an indicator of impairment exists, and capitalised assets are written off where required.
Opening balance at 1 July
Expenditure for the period
Acquired as part of asset acquisition (i)
Acquired as part of business combination (note 13)
Gain on remeasurement of existing interest in KCGM (note 13)
Assets included in a disposal group classified as held for sale (note 15)
Transfer to mine properties
Impairment (ii)
Exchange differences
Closing balance
30 June
2022
$M
609.3
120.5
15.0
-
-
-
(44.4)
(52.4)
5.5
653.5
30 June
2021
$M
479.0
146.4
18.0
208.6
72.0
(28.1)
(182.2)
(101.3)
(3.1)
609.3
(i) Asset acquisition
During the period, the Company paid $15 million to Tanami Gold NL for an additional 10% joint venture interest.
Following the payment, a 50/50 joint venture covering the Central Tanami Project in the Northern Territory was
completed.
During the prior year, the Company completed the acquisition of the Kurnalpi Project from KalNorth Gold Mines
Limited.
Non-financial assets and liabilities
(c) Exploration and evaluation assets (continued)
(ii)
Impairment
At each reporting date the Group undertakes an assessment of the carrying amount of its exploration and
evaluation assets. During the year the Group identified indicators of impairment on certain exploration and
evaluation assets under AASB 6 Exploration for and Evaluation of Mineral Resources. As a result of this review, an
impairment loss of $52.4 million (2021: $101.3 million) has been recognised in the statement of profit or loss and other
comprehensive income in relation to areas of interest where no future exploration and evaluation activities are
expected.
(d) Mine properties
Accounting policy
Mine properties includes aggregate expenditure in relation to mine construction, mine development, exploration
and evaluation expenditure where a development decision has been made and acquired mineral interests.
Expenditure incurred in constructing a mine by, or on behalf of, the Group is accumulated separately for each area
of interest in which economically recoverable reserves and resources have been identified. This expenditure
includes direct costs of construction, drilling costs and removal of overburden to gain access to the ore, borrowing
costs capitalised during construction and an appropriate allocation of attributable overheads.
Mine development represents expenditure in respect of exploration and evaluation, overburden removal based on
underlying mining activities and related mining data and construction costs and development incurred by or on
behalf of the Group previously accumulated and carried forward in relation to properties in which mining has now
commenced. Such expenditure comprises direct costs and an appropriate allocation of directly related overhead
expenditure.
All expenditure incurred prior to commencement of production from each development property is carried forward
to the extent to which recoupment out of future revenue from the sale of production, or from the sale of the
property, is reasonably assured. When further development expenditure is incurred in respect of a mine property
after commencement of commercial production, such expenditure is carried forward as part of the cost of the mine
property only when future economic benefits are reasonably assured, otherwise the expenditure is classified as part
of the cost of production and expensed as incurred. Such capitalised development expenditure is added to the
total carrying value of mine development being amortised.
Mine development costs (as transferred from exploration and evaluation and/or mines under construction) are
amortised on a units-of-production basis over the life of mine to which they relate. In applying the units of production
method, amortisation is calculated using the expected total contained ounces as determined by the life of mine
plan specific to that mine property. For development expenditure undertaken during production, the amortisation
rate is based on the ratio of total development expenditure (incurred and anticipated) over the expected total
contained ounces as estimated by the relevant life of mine plan to achieve a consistent amortisation rate per
ounce. The rate per ounce is typically updated annually as the life of mine plans are revised.
Mineral interests comprise identifiable exploration and evaluation assets, mineral resources and ore reserves, which
are acquired as part of a business combination or joint venture acquisition and are recognised at fair value at the
date of acquisition. Where possible, mineral interests are attributable to specific areas of interest and are classified
within mine properties.
Production stripping expenditure
Stripping (waste removal) costs are incurred both during the development phase and production phase of
operations. Stripping costs incurred during the development phase are capitalised as mines under construction.
Stripping costs incurred during the production phase are generally considered to create two benefits:
•
•
the production of ore inventory in the period - accounted for as a part of the cost of producing those ore
inventories; or
improved access to the ore to be mined in the future - recognised under producing mines if the following
criteria are met:
• Future economic benefits (being improved access to the ore body) associated with the stripping activity are
probable;
• The component of the ore body for which access has been improved can be accurately identified; and
• The costs associated with the stripping activity associated with that component can be reliably measured.
131
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Non-financial assets and liabilities
(d) Mine properties (continued)
Production stripping expenditure (continued)
The amount of stripping costs deferred is based on the life of component ratio which is obtained by dividing the
amount of waste tonnes mined by the quantity of ore tonnes for each component of the mine. Stripping costs
incurred in the period are deferred to the extent that the actual current period waste to ore ratio exceeds the life of
component expected 'life of component' ratio. A component is defined as a specific volume of the ore body that is
made more accessible by the stripping activity and is determined based on mine plans. An identified component of
the ore body is typically a subset of the total ore body of the mine. Each mine may have several components, which
are identified based on the mine plan. The deferred stripping asset is initially measured at cost, which is the
accumulation of costs directly incurred to perform the stripping activity that improves access to the ore within an
identified component, plus an allocation of directly attributable overhead costs. The deferred stripping asset is
depreciated over the expected useful life of the identified component of the ore body that is made more
accessible by the activity, on a units of production basis.
Expected total contained ounces as determined by the life of mine plan are used to determine the expected useful
life of the identified component of the ore body.
Opening balance at 1 July
Expenditure for the period
Changes in rehabilitation provision estimates
Transfer from exploration and evaluation
Acquired as part of business combination
Fair value uplift on remeasurement of interest in KCGM
Assets included in a disposal group classified as held for sale
Amortisation
Exchange differences
Closing balance
132
Impairment
30 June
2022
$M
6,684.1
500.9
(125.0)
44.4
-
-
-
(805.8)
21.2
6,319.8
30 June
2021
$M
1,018.5
348.8
71.4
182.2
4,091.4
1,552.7
(121.0)
(445.1)
(14.8)
6,684.1
At each reporting date, the Group assesses whether there is any indication that an asset, or group of assets is
impaired. If any such indication exists, the recoverable amount of the asset is estimated to determine the extent of
the impairment loss (if any) which is the amount by which the assets carrying value exceeds its recoverable amount.
Where the asset does not generate cash in-flows that are independent from other assets, the Group estimates the
recoverable amount of the cash-generating unit (CGU) to which the asset belongs.
The recoverable amount is the higher of ‘fair value less costs of disposal’ (FVLCOD) and ‘value in use’.
Where an impairment loss subsequently reverses for assets other than goodwill, the carrying amount of the asset (or
CGU) 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 (or CGU) in prior years. A reversal of an impairment loss is recognised in profit or loss
immediately.
Impairment testing requires assets to be grouped together into the smallest group that generates cash inflows from
continuing use that are largely independent of the cash inflows of other assets or cash generating units. Depending
on the location of the mine and processing strategy, as well as other external factors, the CGU may include more
than one operating mine with a processing facility.
There were no indications that an asset or CGU required impairment testing at 30 June 2022.
Non-financial assets and liabilities
(e) Tax balances
(i) Current tax asset/(liability)
Opening balance at 1 July
Acquired balances
Tax paid/ (refund)
Current tax
Adjustment for current tax on prior periods
Closing balance
(ii) Deferred tax assets
The balance comprises temporary differences attributable to:
Acquired tax losses
Employee benefits
Provisions
Accruals
Financial assets at fair value through OCI
Mine properties
Inventories
Other
Share based payments
Sub-total other
Total deferred tax assets
Set-off of deferred tax liabilities pursuant to set-off provisions
Net deferred tax assets
30 June
2022
$M
155.8
-
(86.4)
(61.6)
16.2
24.0
30 June
2022
$M
19.7
21.9
176.2
0.6
1.3
9.1
64.6
293.4
(13.5)
(0.8)
(14.3)
30 June
2021
$M
(12.0)
29.8
140.9
(6.1)
3.2
155.8
30 June
2021
$M
20.6
26.0
175.6
5.8
1.3
1.5
56.1
286.9
8.3
4.3
12.6
279.1
299.5
(279.1)
-
(299.5)
-
133
Movements
Employee
benefits
$M
Provisions
$M
Inventories
$M
Mine Properties
$M
Other
$M
Total
$M
At 1 July 2020
14.2
98.6
(13.0)
(Charged)/credited
- to profit or loss
- to other
comprehensive
income
- acquisition of
subsidiary
At 30 June 2021
4.9
-
6.9
26.0
33.9
-
48.3
180.8
69.1
-
-
56.1
-
1.5
-
-
1.5
43.5
143.3
(21.9)
87.5
(1.9)
15.4
35.1
(1.9)
70.6
299.5
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Non-financial assets and liabilities
(e) Tax balances (continued)
(ii) Deferred tax assets (continued)
Movements
(Charged)/credited
- to profit or loss
- adjustments to
prior year
- directly to equity
At 30 June 2022
(iii) Deferred tax liabilities
(4.1)
-
-
21.9
(4.9)
-
0.3
176.2
8.5
-
-
64.6
7.6
-
-
9.1
(29.4)
1.6
-
7.3
(22.3)
1.6
0.3
279.1
The balance comprises temporary differences attributable to:
Property, plant and equipment
Exploration and evaluation
Mine properties
Investments at fair value
Other
Set-off of deferred tax assets pursuant to set-off provisions
Net deferred tax liabilities
30 June
2022
$M
30 June
2021
$M
243.5
172.7
952.0
1.4
3.7
1,373.3
(279.1)
1,094.2
137.1
87.4
995.1
0.1
5.1
1,224.8
(299.5)
925.3
Offsetting within tax consolidated group
134
Northern Star Resources Limited and its wholly-owned Australian subsidiaries, including those entities acquired as part
of the merger with Saracen Mineral Holdings during the year, have applied Australia's tax consolidation legislation
which means that the Australian entities are taxed as a single entity. Also, Northern Star Resources Limited’s US
entities are regarded as a single taxpayer in the US for income tax purposes. For accounting purposes, deferred tax
assets and deferred tax liabilities, relating to the same taxation authorities, have been offset in the consolidated
financial statements.
Movements
At 1 July 2020
Charged/(credited)
- profit or loss
- to other comprehensive
income
- acquisition of subsidiary
At 30 June 2021
Charged/(credited)
- profit or loss
- adjustment to prior year
- to other comprehensive
income
- acquisition of subsidiary
At 30 June 2022
Exploration and
evaluation
$M
Mine properties
$M
Property, plant
and equipment
$M
Other
$M
Total
$M
69.5
157.1
49.5
-
276.2
(6.7)
-
24.6
87.4
85.1
-
0.2
-
172.7
541.9
-
296.0
995.0
(42.6)
0.2
(0.6)
-
952.1
87.7
-
-
137.2
98.4
3.2
4.6
0.2
243.5
4.7
0.5
-
5.2
(26.6)
-
0.1
26.3
5.1
627.6
0.5
320.6
1,224.8
114.3
3.4
4.3
26.5
1,373.3
Non-financial assets and liabilities
(e) Tax balances (continued)
(iii) Deferred tax liabilities (continued)
Recovery of deferred taxes
Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those
temporary differences and losses. Deferred tax assets, including those arising from unutilised tax losses (where
applicable), require management to assess the likelihood that the Group will comply with the relevant tax legislation
and will generate sufficient taxable earnings in future years in order to recognise and utilise those deferred tax
assets. Estimates of future taxable income are based on forecast cash flows from operations and existing tax laws in
each jurisdiction. These assessments require the use of estimates and assumptions such as exchange rates,
commodity prices and operating performance over the life of the assets. To the extent that cash flows and taxable
income differ significantly from estimates, the ability of the Group to realise the deferred tax assets reported at the
reporting date could be impacted. Additionally, future changes in tax laws in the jurisdictions in which the Group
operates could limit the ability of the Group to obtain tax deductions in future years.
(f)
Inventories
Accounting policy
Gold bullion, gold in circuit and ore stockpiles are physically measured or estimated and valued at the lower of cost
and net realisable value. Cost represents the weighted average cost and includes direct purchase costs and an
appropriate portion of fixed and variable production overhead expenditure, including depreciation and
amortisation, incurred in converting materials into finished goods.
Materials and supplies are valued at the lower of cost and net realisable value. Any allowance for obsolescence is
determined by reference to specific stock items identified. A regular and on-going review is undertaken to establish
the extent of surplus items and an allowance is made for any potential loss on their disposal.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale.
Ore stockpiles which are not expected to be processed in the 12 months after the reporting date are classified as
non-current inventory. Where there is a reasonable expectation that the processing of these stockpiles will have a
future economic benefit to the Group, these stockpiles are carried at the lower of cost and net realisable value. The
non-current ore stockpiles represent the stockpiles that are not expected to be processed in the next 12 months. If
there is significant uncertainty as to if and/or when the stockpiled ore will be processed by the Group, the ore is
expensed as mined, or otherwise, where such indications arise.
135
The determination of the current and non-current portion of ore stockpiles includes the use of estimates and
judgements about when ore stockpile draw downs for processing will occur. These estimates and judgements are
based on current forecasts and mine plans and expected developments, taking in to account operating history.
The initial measurement of the stockpile inventory acquired as part of the KCGM transaction (refer note 13) involved
the use of significant estimates and judgements. The key assumptions employed in measuring this inventory
included: forecast gold prices, processing costs, grade and thus contained metal, processing recoveries and timing
of processing. The initial fair values allocated to ore stockpiles are subsequently considered their deemed cost, and
any future adverse change in the significant estimates and judgements could result in a net realisable value below
deemed cost.
Current assets
Consumable stores
Ore stockpiles
Gold in circuit
Finished goods - dore
Non-current assets
Ore stockpiles
30 June
2022
$M
30 June
2021
$M
116.4
432.3
129.1
1.4
679.2
82.3
378.1
123.5
-
583.9
264.3
404.3
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Non-financial assets and liabilities
(f)
Inventories (continued)
(i) Amounts recognised in profit or loss
Write-downs of ore stockpiles to net realisable value amounted to nil (2021: $436.6 million). The prior year amount
was recognised as an expense during the year ended 30 June 2021 and included in 'impairment of assets' in profit or
loss. Refer to note 6(c) for further detail surrounding the impairment of non-current inventory.
(g) Provisions
Accounting policy
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it
is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably
estimated. Provisions are not recognised for future operating losses.
Provisions are measured at the present value of management's best estimate of the expenditure required to settle
the present obligation at the end of the reporting period. The discount rate used to determine the present value is a
pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.
Rehabilitation costs include the dismantling and removal of mining plant, equipment and building structures, waste
removal and rehabilitation of the site in accordance with the requirements of the mining permits. Such costs are
determined using estimates of future costs, current legal requirements and technology.
Rehabilitation costs are recognised in full at present value as a non-current liability. An equivalent amount is
capitalised as part of the cost of the asset when an obligation arises to decommission or restore a site to a certain
condition after abandonment as a result of bringing the assets to its present location. The capitalised cost is
amortised over the life of the project and the provision is accreted periodically as the discounting of the liability
unwinds. The unwinding of the discount is recorded as a finance cost.
136
Employee entitlements
Rehabilitation
Other*
30 June
2022
Non-
current
$M
3.2
651.5
-
654.7
Current
$M
84.4
-
231.8
316.2
30 June
2021
Non-
current
$M
3.0
776.1
-
779.1
Total
$M
85.5
779.1
231.0
1,095.6
Total
$M
87.6
651.5
231.8
970.9
Current
$M
82.5
3.0
231.0
316.5
*Other provisions includes estimates of stamp duty payable on the completion of past transactions. The stamp duty
provision at 30 June 2022 is $231.1 million (2021: $225.3 million) and includes estimates of stamp duty for the interests
in KCGM and other previous acquisitions.
(i)
Information about individual provisions and significant estimates
Rehabilitation provision
The Group assesses its mine rehabilitation provision annually. Significant judgement is required in determining the
provision for mine rehabilitation and closure as there are many factors that will affect the ultimate liability payable to
rehabilitate the mine sites, including future disturbances caused by further development, changes in technology,
changes in regulations, price increases, changes in timing of cash flows which are based on life of mine plans and
changes in discount rates. When these factors change or become known in the future, such differences will impact
the mine rehabilitation provision in the period in which the change becomes known.
Any changes in the estimates for the costs or other assumptions against the cost of relevant assets are accounted
for on a prospective basis. In determining the costs of site restoration there is uncertainty regarding the nature and
extent of the restoration due to community expectations and future legislation.
2021
Non-financial assets and liabilities
(g) Provisions (continued)
(i)
Information about individual provisions and significant estimates (continued)
Rehabilitation provision (continued)
Long service leave
The liability for long service leave and other long-term benefits is measured at the present value of the estimated
future cash outflows to be made by the Group for those employees with greater than 5 years’ service up to the
reporting date. Long-term benefits not expected to be settled within 12 months are discounted using the rates
attaching to high quality corporate bonds at the reporting date, which most closely match the terms of maturity of
the related liability. In determining the liability for these long-term employee benefits, consideration has been given
to expected future increases in wage and salary rates, the Group’s experience with staff departures and periods of
service. Related on-costs are also included in the liability.
(ii) Movements in provisions
Movements in each class of provision during the financial year, other than employee entitlements, are set out
below:
2022
Carrying amount at start of year
Changes in provisions recognised
Amounts used
- liabilities disposed through sale of business
Unwinding of discount
Exchange differences
Carrying amount at end of year
Carrying amount at start of year
Changes in provisions recognised
- liabilities attributable to assets held for sale
Amounts used
- liabilities disposed through sale of business
Unwinding of discount
Fair value loss on remeasurement of existing interest in KCGM
Exchange differences
Carrying amount at end of year
10 Equity
Rehabilitation
$M
779.1
(125.0)
(0.9)
(21.9)
10.8
9.4
651.5
Rehabilitation
$M
448.5
87.3
(26.8)
-
278.9
4.2
(4.0)
(9.0)
779.1
Other*
$M
231.0
6.1
(5.3)
-
-
-
231.8
Other*
$M
50.2
227.6
(0.2)
(46.6)
-
-
-
-
231.0
137
Accounting policy
Ordinary shares are classified as equity. They entitle the holder to participate in dividends and have no par value.
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.
(a) Share capital
Ordinary shares
Fully paid
Total share capital
30 June
2022
Shares
30 June
2021
Shares
30 June
2022
$M
30 June
2021
$M
1,165,126,222
1,165,126,222
1,163,686,519
1,163,686,519
6,435.0
6,435.0
6,435.1
6,435.1
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Equity
(a) Share capital (continued)
(i) Movements in ordinary shares:
Details
Number of shares
Opening balance 1 July 2020
Employee Share Plan issues
Equity issue net of transaction costs and tax
Issue of shares on vesting of options/performance rights (i)
Balance 30 June 2021
Issue of shares on vesting of options/performance rights (i)
Dividend reinvestment plan net of transaction costs
Closing treasury shares (ii)
Balance 30 June 2022
740,151,041
244,000
422,480,346
811,132
1,163,686,519
565,581
874,122
1,165,126,222
(1,998,823)
1,163,127,399
Total
$M
1,323.9
2.4
5,104.6
4.2
6,435.1
9.3
8.8
6,453.2
18.2
6,435.0
(i) During the year, 279,528 FY19 Performance Rights granted in July 2018 and 286,053 FY21 STI Performance Rights
granted in October and November 2020 vested after their respective performance periods. These had been
awarded to Directors, Key Management Personnel and other senior employees. As a result, 565,581 fully paid
ordinary shares were issued on vesting of the rights.
(ii) During FY22 the Company acquired 2,976,943 treasury shares, of which 1,998,823 remain and will be held in the
Group's Employee Share Trust. Treasury shares represent shares purchased and held by the Group's Employee Share
Trustee in anticipation of future vesting and exercise of Performance Rights. During the period, 230,676 treasury
shares were used in the employee share plan.
138
Risk
This section of the notes discusses the Group’s exposure to various risks and shows how these could affect the
Group’s financial position and performance.
11 Financial risk management
This note explains the Group's exposure to financial risks and how these risks could affect the Group’s future financial
performance. Current year profit and loss information has been included where relevant to add further context.
The Board has the overall responsibility for the establishment and oversight of the risk management framework. The
Audit and Risk Management Committee is responsible for developing and monitoring risk management policies. The
Committee reports regularly to the Board on its activities.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate
risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through its training
and management standards and procedures, aims to develop a disciplined and constructive control environment
in which all employees understand their roles and obligations.
The Group’s Audit and Risk Management Committee oversees how management monitors compliance with the
Group’s risk management policies and procedures and reviews the adequacy of the risk management framework in
relation to the risks faced by the Group.
(a) Market risk
(i) Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk arising from foreign currency
transactions, primarily with respect to the US$. Foreign exchange risk arises from future commercial transactions and
recognised assets and liabilities denominated in a currency that is not the functional currency of the relevant entity.
The carrying value of financial instruments that are held in a currency other than the entities functional currency are
as follows (expressed in Australian dollars):
Financial Assets - USD
Cash and cash equivalents
Derivative financial instruments
Trade receivables
Financial Liabilities - USD
Borrowings - Secured Asset Financing
139
30 June
2022
$M
96.2
-
17.3
113.5
30 June
2022
$M
149.9
30 June
2022
$M
30 June
2021
$M
25.6
0.4
16.6
42.6
30 June
2021
$M
-
30 June
2021
$M
Financial Assets - CAD
Cash and cash equivalents
5.0
-
The sensitivity of profit or loss to changes in the exchange rates arises mainly from US dollar-denominated financial
instruments. A 10 percent increase in the AUD/USD exchange rate would decrease post tax profit by $2.5 million
while a 10 percent decrease in the AUD/USD exchange rate would increase post tax profit by $3 million.
Foreign currency forwards
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Financial risk management
(a) Market risk (continued)
(i)
Foreign exchange risk (continued)
The Group uses foreign currency forwards to hedge its exposure to foreign currency risk. The group has determined
the fair value of the foreign currency forwards by calculating the present value of future cash flows based on
observable forward exchange rates at the balance sheet date. As the forward contracts are used to hedge
forecast transactions, the group designates the full change in fair value of the forward contract as the hedging
instrument and recognises the gains or losses relating to the effective portion of the change in fair value of the entire
forward contract in the cash flow hedge reserve within equity.
(ii) Cash flow and fair value interest rate risk
The Group is exposed to interest rate risk through its longer term borrowings comprising a $500 million facility maturing
30 June 2024 and $500 million facility maturing 30 June 2025. At 30 June 2022, the Group has drawn down $100
million from these facilities. The Group is exposed to the risk of future changes in market interest rates.
Holding all other variables constant, the impact on post tax profit of a 1 percent increase/ decrease in the rate of
interest on the borrowings of the Group would be a decrease/increase of $2 million.
The Group is also exposed to interest rate risk through its borrowings related to the purchases of plant and
equipment under secured asset financing arrangements with floating rates of interest over their term. At 30 June
2022, the value of secured asset finance borrowings with a floating rate of interest is $70.9 million.
Holding all other variables constant, the impact on post tax profit of a 1 percent increase/ decrease in the rate of
interest on these secured asset finance borrowings of the Group is $0.7 million.
Borrowings related to the purchases of plant and equipment under secured asset financing arrangements which
have fixed interest rates over their term are not subject to interest rate risk as defined in AASB 7 Disclosures. The value
of secured asset finance borrowings with a fixed rate of interest is $199.8 million.
(iii) Price risk
Exposure
The Group is exposed to the risk of fluctuations in the prevailing market prices for the gold and silver currently
produced from its operating mines.
140
The Group manages a component of this risk through the use of gold forward contracts and options. These
contracts are accounted for as sale contracts with revenue recognised once gold has been physically delivered
into the contract. The physical gold delivery contracts are considered a contract to sell a non-financial item and
therefore do not fall within the scope of AASB 9 Financial Instruments. The Group's contractual sales commitments
are disclosed in note 18.
The Group is also exposed to equity securities price risk arising from investments held by the Group and classified in
the statement of financial position as financial assets at fair value through OCI and investments accounted for using
the equity method.
All of the Group's equity investments are publicly traded on the Australian Securities Exchange.
(b) Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligation resulting in financial loss to
the Group. Credit risk arises from cash and cash equivalents and credit exposures to gold sales counterparties and
financial counterparties.
(i) Risk management
The Group has adopted the policy of dealing with creditworthy counterparties as a means of mitigating the risk of
financial loss from defaults. Cash is deposited only with institutions approved by the Board, typically with a current
minimum credit rating of A (or equivalent) as determined by a reputable credit rating agency e.g. Standard &
Poor’s. Permitted instruments by which the Group hedges gold price risk are entered into with financial
counterparties with a minimum credit of A (or equivalent). The Group has established limits on aggregate funds on
term deposit or invested in money markets to be placed with a single financial counterparty and monitors credit
and counterparty risk using credit default swaps. The Group sells the majority of its unhedged gold and silver to
counterparties with settlement terms of no more than 2 days. The counterparties have investment grade credit
ratings and the exposures, as noted, are short dated. The Group does not have any other significant credit risk
exposure to a single counterparty or any group of counterparties having similar characteristics.
Financial risk management
(b) Credit risk (continued)
(ii) Credit quality
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external
credit ratings (if available) or to historical information about counterparty default rates.
Trade receivables
Counterparties with external credit rating
AA
Counterparties without external credit rating *
Other
Total trade receivables
Cash at bank and short-term bank deposits
AA
A
* Other - counterparties with no defaults in the past
(iii)
Impaired trade receivables
30 June
2022
$M
30 June
2021
$M
57.2
1.0
58.2
538.5
32.6
571.1
17.4
7.9
25.3
763.0
8.9
771.9
In determining the recoverability of trade and other receivables, the Group performs a risk analysis considering the
type and age of the outstanding receivable and the creditworthiness of the counterparty. If appropriate, an
impairment loss will be recognised in profit or loss. The Group does not have any impaired Trade and other
receivables as at 30 June 2022 (2021: nil). No allowance for expected credit losses has been recognised as the
duration of associated exposures is short and/or the probability of default is negligible.
(c) Liquidity risk
141
The Group manages liquidity risk by monitoring immediate and forecasted cash requirements and ensures
adequate cash reserves are maintained to pay debts as and when they fall due.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability
of funding through an adequate amount of committed credit facilities to meet obligations when due. At the end of
the reporting period, the Group held a short term on-demand cash balance of $571.1 million (2021: $771.9 million)
that was available for managing liquidity risk.
Management monitors rolling forecasts of the Group's available cash reserves on the basis of expected cash flows.
The Group's liquidity management policy seeks a target to maintain available cash (comprising cash on hand,
deposits at call, bullion awaiting settlement and available undrawn debt) of approximately three months of total
recurring operational and corporate expenditure.
(i)
Financing arrangements
The Group had access to the following undrawn borrowing facilities at the end of the reporting year:
30 June
2022
$M
30 June
2021
$M
Floating rate
- Expiring beyond one year (financing facility)
900.0
338.0
The revolving credit facilities may be drawn at any time until maturity (June 2024 :$500 million, $100 million drawn
and June 2025: $500 million, undrawn).
Refer to note 8(e) for full details of financing facilities available to the Group.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Financial risk management
(c) Liquidity risk (continued)
(ii) Maturities of financial liabilities
The tables below analyse the Group's financial liabilities into relevant maturity groupings based on their contractual
maturities.
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months
equal their carrying balances as the impact of discounting is not significant.
Contractual maturities of financial
liabilities
At 30 June 2022
Trade and other payables
Lease liabilities
Secured asset financing
Borrowings
Total non-derivatives
At 30 June 2021
Trade and other payables
Lease liabilities
Secured asset financing
Borrowings
Total non-derivatives
Less than 6
months
$M
6 - 12
months
$M
Between 1
and 2
years
$M
Between 2
and 5
years
$M
Total
contractual
cash
flows
$M
Over 5
years
$M
Carrying
amount
liabilities
$M
339.5
28.2
41.5
1.3
410.5
296.5
28.5
20.3
5.8
351.1
-
22.6
35.8
1.3
59.7
-
24.4
17.0
5.7
47.1
-
45.3
59.5
101.9
206.7
-
53.1
36.8
11.5
101.4
-
50.7
149.3
-
200.0
-
37.1
14.7
673.7
725.5
-
2.9
-
-
2.9
-
5.2
1.4
-
6.6
339.5
149.8
286.1
104.5
879.9
339.5
143.3
270.7
97.5
851.0
296.5
148.2
90.3
696.7
1,231.7
296.5
141.9
87.9
658.3
1,184.6
The weighted average interest rate on secured asset financing was 2.37% (2021: 1.95%).
12 Capital management
142
(a) Risk management
The Group's objectives when managing capital are to:
•
safeguard their ability to continue as a going concern, so that they can continue to provide returns for
shareholders and benefits for other stakeholders, and
• maintain an optimal capital structure to reduce the cost of capital and maximise returns to Shareholders and
benefits for other stakeholders.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to
Shareholders, return capital to Shareholders or issue new shares.
Total capital is equity, as shown in the statement of financial position. The Group is not subject to any externally
imposed capital requirements.
(b) Dividends
(i) Ordinary shares
Capital management
(b) Dividends (continued)
(i) Ordinary shares (continued)
Final ordinary divided for FY21 of 9.5 cents (FY20: 9.5 cents) per fully paid share paid
on 29 September 2021 (FY20: 30 September 2020)
Interim ordinary dividend for FY22 of 10 cents (FY21: 9.5 cents) per fully paid ordinary
share paid on 29 March 2022 (FY21: 30 March 2021)
Special dividend of 10 cents per fully paid share paid on 30 September 2020
Interim ordinary dividend for FY20 of 7.5 cents per fully paid ordinary share, which
was postponed in March 2020 when the company withdrew its FY20 guidance, and
was paid on 16 July 2020
(ii) Dividends not recognised at the end of the reporting period
30 June
2022
$M
30 June
2021
$M
110.7
116.4
-
-
227.1
227.1
70.4
110.5
74.1
55.5
310.5
310.5
30 June
2022
$M
30 June
2021
$M
In addition to the above dividends, since year end the Directors have
recommended the payment of a final dividend of 11.5 cents per fully paid ordinary
share (2021 - 9.5 cents) as at 30 June 2022, fully franked based on tax paid at 30%.
The aggregate amount of the proposed dividend expected to be paid on 29
September 2022 out of retained earnings at 30 June 2022, but not recognised as a
liability at year end, is
134.0
110.5
143
(iii) Franking credits
At 30 June 2022 the value of franking credits available (at 30%) was $135.1 million (2021: $321.9 million).
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Group structure
This section provides information which will help users understand how the Group structure affects the financial
position and performance of the Group as a whole. In particular, there is information about:
•
•
•
changes to the structure that occurred during the year as a result of business combinations and the disposal of
a discontinued operation
interests in joint operations
interests in associates.
A list of significant subsidiaries is provided in note 16.
13 Business combination
Accounting policy
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity
instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises
the: fair values of the assets transferred; liabilities incurred to the former owners of the acquired business; equity
interests issued by the Group; fair value of any asset or liability resulting from a contingent consideration
arrangement; and fair value of any pre-existing equity interest in the subsidiary.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with
limited exceptions, measured initially at their fair values at the acquisition date. The application of acquisition
accounting requires significant judgement and estimates to be made, which are discussed below. The Group
engages independent third parties to assist with the determination of the fair value of assets acquired, liabilities
assumed, non-controlling interest, if any, and goodwill, based on recognised business valuation methodologies.
The income valuation method represents the present value of future cash flows over the life of the asset using:
(a) Power Business Acquisition
On 23 November 2021, NST announced that it has agreed to acquire Newmont Corporations' Kalgoorlie power
business from Newmont Corporation's Australian subsidiary, Newmont Australia, for US$95M. As part of NST's purchase
of 50 per cent of KCGM Pty Ltd on 3 January 2020, NST paid US$25M for an option to buy Newmont Corporation's
Kalgoorlie power business.
The 110MW Parkeston Power Station and associated infrastructure primarily provides electricity security to
KCGM. Parkeston also supplies electricity to the Kalgoorlie area through its connection to the South-West
Interconnected System. The plant has a history of continuous reliable generation.
The transaction was completed on 1 December 2021. The cost of the US$25M option was deducted from the
final purchase price, with US$70M paid at completion.
Purchase consideration
Original option fee paid (US$25m)
Expense Transitional Service Fee (US$2.5M)
Cash Paid on Settlement (US$70M)
Total purchase consideration
Net identifiable assets acquired
Trade and other receivables
Property, plant and equipment
Intangible assets
Trade and other payables
Deferred tax liability
Net identifiable assets acquired
Less: loss on extinguishment of KCGM contract*
Net assets acquired
$M
36.4
(3.6)
98.0
130.7
13.9
43.1
87.5
(7.2)
(26.5)
110.8
(19.4)
130.2
• financial forecasts, which rely on management’s estimates of reserve quantities and exploration potential, costs to
produce and develop reserves, revenues, and operating expenses;
• long-term growth rates;
• appropriate discount rates; and
• expected future capital requirements.
144
* As required by Accounting Standards, a $19.4 million loss was recorded on settlement of a pre-existing
power purchase agreement between the acquired business and KCGM.
We note that fair values assigned to identifiable assets, liabilities and associated tax balances above are presented
on a provisional basis. The Group may recognise an adjustment to these provisional values as a result of completing
fair value accounting within 12 months following acquisition date.
145
The market valuation method uses prices paid for a similar asset by other purchasers in the market, normalised for
any differences between the assets.
The cost valuation method is based on the replacement cost of a comparable asset at the time of the acquisition
adjusted for depreciation and economic and functional obsolescence of the asset and estimates of residual values.
The Group recognises any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either
at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the consideration transferred and the amount of any non-controlling interest in the acquiree over the
acquisition date fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less
than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has
been reviewed, the difference is recognised directly in profit or loss as a bargain purchase.
If the initial accounting for the business combination is not complete by the end of the reporting period in which the
acquisition occurs, an estimate will be recorded. Subsequent to the acquisition date, but not later than one year
from the acquisition date, the Group will record any material adjustments to the initial estimate based on new
information obtained that would have existed as of the date of the acquisition.
As outlined in the Group’s Business Combination accounting policy above, the identification of assets and liabilities
and associated fair value measurement as part of acquisition accounting is subject to significant judgement and
estimation.
The following key estimates and judgements were required as part of the acquisition accounting for the power
business:
Property, plant and equipment - the valuation of these assets involved use of, amongst other factors, publicly
available historical capital unit costs, industry benchmarks, producer price index factors, current
replacement/reproduction costs, useful life assumptions, residual values and site inspections to determine current
asset conditions and utilisation.
Intangible assets - the valuation of these assets involved use of, amongst other factors, grid reliability assumptions
and various costs assumptions including of backup power station costs, energy cost, network charges, capex costs,
balancing costs, demand charges, transmission costs, instillation costs and discount factors.
Deferred tax liability - the recognition of deferred tax liabilities is directly associated with the determination of both
initial accounting values and the determination and allocation of tax bases on entry into the Group's tax
consolidated group. The balance reflects the non-deductibility for tax purposes of the intangible assets.
Revenue and profit contribution
The power business does not generate revenue, given its purpose to provide electricity security to KCGM.
Acquisition related costs
Acquisition related costs of $2.8 million are included in acquisition and integration expense in profit or loss.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Business combination
(b) Prior year acquisition - Saracen Mineral Holdings Limited
(i)
Summary of the acquisition
On 12 February 2021, the Company implemented the scheme of arrangement (Scheme) in relation to the merger of
the Company and Saracen Mineral Holdings Limited (Saracen).
In accordance with the Scheme, all Saracen shares have been transferred to Northern Star, and eligible Saracen
shareholders were issued the Scheme consideration of 0.3763 Northern Star shares for each Saracen share held on
the Scheme record date. Consequently, 422,480,346 Northern Star shares were issued on that date.
In addition to recognising the effects of acquiring Saracen’s assets and liabilities, the transaction also results in the
Company obtaining control over Kalgoorlie Consolidated Gold Mines Pty Ltd (KCGM) in which it previously held a 50
percent joint operating interest.
Details of the purchase consideration and the net identifiable assets acquired are as follows:
Purchase consideration
Ordinary shares issued*
Net purchase consideration
$M
5,107.2
5,107.2
* 422,480,346 ordinary shares were issued as consideration with a deemed fair value based on the 1-day volume
weighted average share price on Implementation Date of $12.09 per share.
The assets and liabilities recognised as a result of the acquisition are as follows:
Business combination
(b) Prior year acquisition - Saracen Mineral Holdings Limited
Inventory - refer to note 9(f) for estimates and judgements involved in determining acquired inventory values.
Property, plant and equipment - expert plant valuers were engaged to assist in determining the fair values for
property, plant and equipment. The valuation of these assets involved use of, among other factors, published
market data, current replacement/reproduction costs, residual values, inflation factors, useful life assumptions and
site inspections to determine current wear and tear.
Mine Properties - in a mining transaction the residual amount of purchase consideration after all the other assets and
liabilities have been identified and re-measured to reflect acquisition date fair value is typically allocated to mine
properties (excluding site rehabilitation). After this allocation, further analysis in the form of discounted cash flows
and market implied resource multiples are used to ensure the fair value ascribed to mine properties is fair and
reasonable. Discounted cash flow analysis requires estimation of the future amount and timing of cash flows.
Estimates and judgement are required in selecting the inputs for such analysis including: total ore tonnes, grade,
metal recoveries, gold prices, exchange rates, future mining, processing costs and capital costs and discount rates.
Analysis and cross checks to market data using implied resource multiples also requires the use of judgement when
selecting comparative companies and transactions with which to perform comparisons.
Hedgebook contract liability - Assessment of the gold sales contracts relative to market rates is required at the date
of acquisition. Where gold sales contracts are below market rates on a net basis (i.e. unfavourable), a contract
liability is recognised based on the difference in the contracted gold sales price relative to the gold price for a
forward contract with the same maturity date as at the date of acquisition.
Fair Value
$M
Provision for rehabilitation - refer to note 9(g) for estimates and judgements involved in determining provisions for
rehabilitation.
146
Cash and cash equivalents
Trade and other receivables
Income tax receivable
Inventories - finished product
Inventories - gold in circuit
Inventories - ore stockpiles
Inventories - supplies (net of provision)
Inventories - ore stockpiles (non-current)
Property, plant and equipment
Mine properties
Deferred exploration
Right of use assets
Investments
Trade and other payables
Employee Provisions
Hedgebook contract liability
Lease liabilities
Borrowings
Employee provisions (non-current)
Derivative liability (non-current)
Lease liabilities (non-current)
Borrowings (non-current)
Deferred tax liability
Provision for rehabilitation
Net identifiable assets acquired
402.5
12.6
29.8
5.5
58.0
230.4
34.9
442.4
632.6
4,091.4
208.6
103.9
0.7
(128.7)
(22.5)
(57.0)
(26.3)
(77.0)
(1.6)
(8.0)
(89.8)
(206.0)
(250.3)
(278.9)
5,107.2
As outlined in the Group’s Business Combination accounting policy above, the identification of assets and liabilities
and associated fair value measurement as part of acquisition accounting is subject to significant judgement and
estimation.
The following key estimates and judgements were required as part of the acquisition accounting for Saracen:
Deferred tax - the recognition of deferred tax liabilities is directly associated with the determination of both initial
accounting values and the determination and allocation of tax bases on entry into the Group’s tax consolidated
group. In Saracen's case, value attributed to the underlying tenement value is non-tax deductible due to those
tenements held by the acquired entities being subject to the capital gains tax rules rather than the tax depreciation
rules enacted in 2001.
147
(ii) Acquired receivables
The fair value of acquired trade receivables is $12.6 million. The gross contractual amount for trade receivables due
is $12.6 million, of which none is expected to be uncollectible.
(iii) Revenue and profit contribution
The acquired business contributed revenues of $531.6 million and net profit of $6.1 million to the group for the period
12 February 2021 to 30 June 2021. This excludes the impact of the remeasurement of the Company's initial 50
percent interest in KCGM.
If the acquisition had occurred on 1 July 2020, consolidated pro-forma revenue and net profit for the year ended 30
June 2021 would have been $1,275.9 million and $14.6 million respectively, based on an extrapolation of actual
results since acquisition.
Purchase consideration - cash inflow
Inflow of cash on acquisition of subsidiary
Cash balances acquired
Net inflow of cash - Investing activities
Acquisition-related costs
$M
402.5
402.5
Acquisition related costs of $231.1 million are included in acquisition and integration in profit or loss.
Remeasuring of the equity interest in the acquiree held by the acquirer before the business combination
The acquistion of Saracen Mineral Holdings Limited resulted in the Company obtaining control over KCGM, in which
it previously held a 50 percent joint operating interest. As a result, there is a requirement to remeasure the
Company's pre-existing 50 percent interest in KCGM to fair value. This has resulted in a pre-tax gain of $1.92 billion
recognised in the statement of profit or loss and other comprehensive income.
The assets and liabilities relating to the remeasurement of the Company's pre-existing 50 percent interest in KCGM to
fair value are as follows:
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Business combination
(b) Prior year acquisition - Saracen Mineral Holdings Limited
Remeasuring of the equity interest in the acquiree held by the acquirer before the business combination (continued)
Current Assets
Inventories - gold in circuit
Inventories - ore stockpiles
Inventories - supplies (net of provision)
Non-current assets
Inventories - ore stockpiles
Property, plant & equipment
Mine properties
Deferred exploration
Right of use assets
Current liabilities
Lease liabilities
Non-current liabilities
Lease liabilities
Rehabilitation provision
Gain on remeasurement (pre-tax)
Deferred tax liability
Gain on remeasurement (post-tax)
14 Sale of business
(a) Kundana Assets
$M
17.3
75.6
(3.1)
101.8
98.7
1,552.7
72.0
1.2
(0.6)
(0.3)
4.0
1,919.3
(575.8)
1,343.5
Sale of business
Sale consideration
Cash
Issue of shares
Cash receivable
Contingent consideration
Carrying amount of net liabilities disposed of
Trade and other receivables
Inventories
Property, plant and equipment
Exploration and evaluation assets
Trade and other payables
Provision for rehabilitation
15 Assets classified as held for sale
(a) Description
Prior Year assets classified as held for sale
$M
14.5
2.9
15.0
5.0
18.7
56.1
Fair Value
$M
0.4
0.1
0.7
2.2
(0.2)
(21.9)
(18.7)
On 22 July 2021, the Group announced that it had entered a binding agreement to sell the Kundana Assets to
Evolution Mining Ltd. The associated assets and liabilities were consequently presents as held for sale in the year
ended June 21 financial statements.
The sale was completed on 18 August 2021.
148
Sale Consideration
Cash
Carrying amount of net assets disposed of
Cash and cash equivalents
Trade and other receivables
Inventories
Property, plant and equipment
Exploration and evaluation assets
Mine Properties
Trade and other payables
Provisions - other
Provision for rehabilitation
(b) Paulsens and Western Tanami
$M
401.9
(160.0)
241.9
Fair value
$M
2.0
4.0
13.0
39.0
44.0
110.0
(12.0)
(34.0)
(6.0)
160.0
On 13 April 2022, the Company announced it had entered into a binding agreement to sell the Paulsens Gold
Operations and Western Tanami Gold Project to Black Cat Syndicate (“BCS”).
The transaction completed on 15 June 2022.
During Q4 of FY21, the Company began marketing the sale of it's Kundana Operations, its 51% interest in each of the
East Kundana Production Joint Venture and the East Kundana Exploration Joint Venture, its 75% interest in the West
Kundana Farmin Joint Venture, and the Carbine / Carnage gold project ('Kundana Assets"). As at 30 June 2021 the
assets were available for immediate sale and the sale was considered highly probable within a 12 month period. The
associated assets and liabilities were consequently presented as held for sale.
Subsequently, on 22 July 2021 the Group announced that it has entered into a binding Share and Asset Sale
Agreement with Evolution Mining Ltd (ASX: EVN) for the Kundana Assets for a purchase price of $402 million cash.
149
The transaction completed on 18 August 2021. Refer to note 14 for further details.
The disposal group contributed $7.5 million (2021: $281.8 million) of revenue and $11.5 million of losses (2021: $39.9
million profit after tax) during FY22. Gold sales for the year relating to the disposal group were 3,170 oz (2021:
122,495oz).
(b) Assets and liabilities of disposal group classified as held for sale
The following assets and liabilities were reclassified as held for sale in relation to the sale of the Kundana Assets as at
30 June 2021:
Assets classified as held for sale
Cash and cash equivalents
Trade and other receivables
Inventories
Property, plant and equipment
Exploration and evaluation assets
Mine properties
Total assets of disposal group held for sale
30 June
2022
$M
3.2
5.9
16.1
30.0
28.1
121.0
204.3
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Assets classified as held for sale
(b) Assets and liabilities of disposal group classified as held for sale (continued)
Liabilities directly associated with assets classified as held for sale
Trade and other payables
Provisions
Borrowings
Total liabilities of disposal group held for sale
Net assets held for sale
Net assets held for sale
16 Interests in other entities
(a) Material subsidiaries
(14.0)
(33.3)
(18.0)
(65.3)
139.0
The Group’s principal subsidiaries at 30 June 2022 are set out below. Unless otherwise stated, they have share capital
consisting solely of ordinary shares that are held directly by the Group, and the proportion of ownership interests held
equals the voting rights held by the Group. The country of incorporation or registration is also their principal place of
business.
Name of entity
Northern Star Mining Services Pty Ltd
Northern Star (Kanowna) Pty Ltd
Kundana Gold Pty Ltd
Gilt-Edged Mining Pty Ltd
EKJV Management Pty Ltd
Kanowna Mines Pty Ltd
GKL Properties Pty Ltd
Northern Star (Tanami) Pty Ltd
Northern Star (Western Tanami) Pty Ltd
Northern Star (South Kalgoorlie) Pty Ltd
Northern Star (HBJ) Pty Ltd
150
Northern Star (Hampton Gold Mining Areas) Limited
Northern Star (Holdings) Pty Ltd
Northern Star (Alaska) Incorporated
Northern Star (Alaska) LLC
Northern Star (Pogo) LLC
Northern Star (Pogo Two) LLC
Stone Boy Inc.
Northern Star (KLV) Pty Ltd
Kalgoorlie Consolidated Gold Mines Pty Ltd
Northern Star (Bronzewing) Pty Ltd
Northern Star (Yandal Consolidated) Pty Ltd
Northern Star (Echo Mining) Pty Ltd
Northern Star (MKO) Pty Ltd
Northern Star (Saracen Kalgoorlie) Pty Ltd
Northern Star (Carosue Dam) Pty Ltd
Northern Star (Thunderbox) Pty Ltd
Northern Star (Saracen) Pty Ltd
Northern Star (Saracen Goldfields) Pty Ltd
Northern Star (Bundarra) Pty Ltd
Northern Star (SR Mining) Pty Ltd
Northern Star (Sinclair) Pty Ltd
Northern Star (Talisman) Pty Ltd
Country of
incorporation
Ownership interest held by
the Group
2022
%
2021
%
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
England &
Wales
Australia
United States of
America
United States of
America
United States of
America
United States of
America
United States of
America
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100.0
100.0
-
-
-
-
-
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Interests in other entities
(a) Material subsidiaries (continued)
Name of entity
Northern Star (GMK) Pty Ltd
Northern Star (Power) Pty Ltd
Goldfields Power Pty Ltd
CTP JV Pty Ltd
Northern Star (Holdings 2) Pty Ltd
Northern Star (NPK) Pty Ltd
1335088 B.C. Ltd
Country of
incorporation
Ownership interest held by
the Group
2022
%
2021
%
Australia
Australia
Australia
Australia
Australia
Australia
Canada
100.0
100.0
50.0
50.0
100.0
100.0
100.0
-
-
-
-
-
-
-
For information regarding entities party to a deed of cross guarantee refer to note 24.
(b) Joint arrangements
FMG JV
East Kundana Production JV
Kanowna West JV
Kalbara JV
West Kundana JV
Zebina JV
Acra JV
Robertson JV
Cheroona JV
Sorrento JV
Jundee JV
Phantom Well JV
Nexus JV
AngloGold JV
Central Tanami JV
Principal Activities
Exploration
Exploration & Production
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Ownership interest held
2021
%
67.7
51.0
92.4
71.4
75.5
80.0
75.0
40.0
30.0
70.0
70.0
87.0
10.0
30.0
40.0
2022
%
68.3
-
97.7
71.6
-
80.0
75.0
40.0
30.0
70.0
70.0
87.0
10.0
30.0
50.0
151
The joint arrangements listed above are classified as joint operations and are not separate legal entities. They are
contractual arrangements between participants for the sharing of costs and outputs and do not themselves
generate revenue and profit. The joint operations are of the type where initially one party contributes tenements
with the other party earning a specified percentage by funding exploration activities; thereafter the parties often
share exploration and development costs and output in proportion to their ownership of joint venture assets. The joint
operations are accounted for in accordance with the Group's accounting policy set out in note 25.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Further details
This section of the notes includes other information that must be disclosed to comply with the accounting standards
and other pronouncements, but that is not immediately related to individual line items in the consolidated financial
statements.
Related party transactions
(b) Key management personnel compensation (continued)
17 Contingent liabilities
(a) Contingent liabilities
The Group had no contingent liabilities at 30 June 2022.
18 Commitments
(a) Capital commitments
Significant capital expenditure contracted for at the end of the reporting year but not recognised as liabilities is as
follows:
Property, plant and equipment
30 June
2022
$M
30 June
2021
$M
178.5
266.5
30 June 2022 capital commitments includes $86.6 million (2021: $153.6 million) in relation to mining fleet updates
across the group.
(b) Gold delivery commitments
Australian dollar gold delivery commitments as at 30 June 2022 were as follows:
152
Within one year
Later than one year but not later than five years
There were no US dollar gold delivery commitments as at 30 June 2022.
19 Events occurring after the reporting period
Subsequent to the period ended 30 June 2022 the Company announced:
Gold for
physical
delivery
(Ounces)
439,000
699,999
Weighted
average
contracted
sales price
(A$/oz)
2,411
2,640
Value of
committed
sales
(A$M)
1,058.2
1,847.7
•
•
a final fully franked dividend of 11.5 cents per share to Shareholders on the record date of 7 September 2022,
payable on 29 September 2022
the Board has unanimously approved an on-market share buy-back for up to A$300 million to be completed
over the next 12 months. The buy-back is subject to prevailing share price and market conditions and will be
executed at the Company’s discretion. The buy-back aligns with the Company's disciplined capital allocation
priorities, which include returning cash to shareholders, investing in organic profitable growth and maintaining a
strong balance sheet. The share buyback will not affect the company's dividend policy to pay out between
20% and 30% of cash earnings.
20 Related party transactions
(a) Subsidiaries
Interests in subsidiaries are set out in note 16(a).
(b) Key management personnel compensation
30 June
2022
$000
6,388.9
443.6
219.2
4,347.4
11,399.1
30 June
2021
$000
6,911.2
116.9
242.4
7,114.3
14,384.8
Short-term employee benefits
Employee entitlements
Post-employment benefits
Share-based payments
(c) Transactions with other related parties
(i) Purchases from entities controlled by key management personnel
Nil.
21 Share-based payments
(a) Employee Share Plan
Under the Employee Share Plan, eligible employees may be granted up to $1,000 of fully paid ordinary shares in the
Company annually for no cash consideration. The number of shares issued to participants in the scheme is the offer
amount divided by the weighted average price at which the Company’s shares are traded on the ASX during the
week up to and including the date of grant. The fair value of shares issued during the year was $7.96 (2021: $9.90)
per share.
2022
2021
Number of shares issued under the plan to participating employees on 24 June
2022 (2021: 17 June)
230,676
244,000
153
(b) Performance Share Plan
No performance shares were issued in the year ended 30 June 2022 (2021: Nil).
Total performance shares on issue at 30 June 2022 is Nil (2021: 1,091,001), with a corresponding total non-recourse
loan value of $Nil (2021: $801,295).
(c) Performance Rights, NED Share Rights and Restricted Shares
Performance rights
A performance right is a conditional right which, upon the satisfaction or waiver of the relevant vesting conditions,
and, if required by the Company the exercise of that right, entitles its holder to receive one share.
During the year, the Company issued 3,878,634 long term incentive (LTI) rights and 726,225 short term incentive (STI)
rights to senior management, including key management personnel. The rights were issued under the FY20 share
plan as approved at the Company's annual general meeting on 18 November 2021. During the year, 270,029 FY2022
LTI rights and 23,338 FY2022 STI rights were forfeited. The number of performance rights outstanding as at 30 June
2022 in relation to the FY2022 grant is 4,311,492.
During the prior year, the Company issued 1,155,477 LTI rights (733,779 remain on issue at 30 June 2022) and 489,671
STI rights (nil on issue at 30 June 2022) to senior management, including key management personnel. The rights were
issued under the FY20 share plan as refreshed at the Company's annual general meeting on 25 November 2020.
Since grant date, 421,698 FY2021 LTI rights and 14,801 FY2021 STI rights were forfeited, while 286,053 FY2021 STI rights
vested and 188,817 FY2021 STI rights lapsed.
NED Share Rights
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Share-based payments
Share-based payments
(c) Performance Rights, NED Share Rights and Restricted Shares
(c) Performance Rights, NED Share Rights and Restricted Shares
A NED share right is a conditional right to a fully paid ordinary share, where vesting is measured on 30 June in each
financial year of issue, based on the length of time the NED was on the Board, with pro-rata reduction where the
Director ceases to be a director before the end of the relevant financial year.
During the year, the Company issued 14,328 NED share rights to Non-executive Directors. The NED share rights were
issued under the FY20 NED share plan as approved at the Company's annual general meeting on 14 November
2019. The number of NED share rights outstanding as at 30 June 2022 in relation to the FY2022 grant is 14,328.
During the prior year, the Company issued 18,560 NED share rights to Non-executive Directors. The rights were issued
under the FY20 NED share plan as approved at the Company's annual general meeting on 14 November 2019.
During the prior year, 1,403 NED share rights were forfeited. The remaining 17,517 NED share rights relating to the FY
2021 grant have vested.
For each of the above grants, the weighted average assessed fair value at grant date is as follows:
LTI Performance Rights
STI Performance Rights
NED Share Rights
Weighted average fair value at
grant date
FY2022 grant
$6.80
$9.54
$9.28
FY2021 grant
$11.15
$14.26
$14.74
The fair value of LTI performance rights at grant date is independently determined using a Monte Carlo simulation
model (market based vesting conditions) and a Black Scholes Model (non market vesting conditions) that takes into
account the term of the performance rights, the impact of dilution (where material), the share price at grant date
and expected volatility of the underlying share, the expected dividend yield, the risk-free rate for the term of the
performance right and the correlations and volatilities of the peer group companies.
The model inputs for LTI performance rights granted during the current and prior year included:
FY22 LTI-1 Rights
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
(f) Expected volatility of the company's shares
(g) Expected volatility of the index
(h) Expected dividend yield
(i) Risk-free interest rate
FY22 LTI-2 Rights
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
(f) Expected volatility of the shares
(g) Expected volatility of the index
(h) Expected dividend yield
(i) Risk free interest rate
FY21 LTI Rights - Grant 1
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
(f) Expected volatility of the company's shares
(g) Expected volatility of the index
(h) Expected dividend yield
(i) Risk-free interest rate
KPI (1), (3)
Nil
18/11/2021
01/07/2021
30/06/2025
$10.49
50%
n/a
1.3%
0.97%
KPI (1), (3)
Nil
18/11/2021
01/07/2021
30/06/2024
$10.49
50%
n/a
1.3%
0.97%
Tranche A, C
Nil
25/11/2020
1/07/2020
30/06/2023
$12.52
50%
n/a
1.30%
0.13%
KPI (2)
Nil
18/11/2021
01/07/2021
30/06/2025
$10.49
50%
35%
1.3%
0.97%
KPI (2)
Nil
18/11/2021
01/07/2021
30/06/2024
$10.49
50%
35%
1.3%
0.97%
Tranche B
Nil
25/11/2020
1/07/2020
30/06/2023
$12.52
50%
35%
1.30%
0.13%
KPI (4), (6)
Nil
13/10/2021
01/07/2021
30/06/2025
$9.37
50%
n/a
1.3%
0.48%
KPI (4), (6)
Nil
13/10/2021
01/07/2021
30/06/2024
$9.37
50%
n/a
1.3%
0.48%
Tranche D, F
Nil
30/10/2020
1/07/2020
30/06/2023
$14.85
50%
n/a
1.30%
0.13%
KPI (5)
Nil
13/10/2021
01/07/2021
30/06/2025
$9.37
50%
35%
1.3%
0.48%
KPI (5)
Nil
13/10/2021
01/07/2021
30/06/2024
$9.37
50%
35%
1.3%
0.48%
Tranche E
Nil
30/10/2020
1/07/2020
30/06/2023
$14.85
50%
35%
1.30%
0.13%
154
FY21 LTI Rights - Grant 2
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
(f) Expected volatility of the company's shares
(g) Expected volatility of the index
(h) Expected dividend yield
(i) Risk-free interest rate
Tranche A, C
Nil
2/02/2021
12/02/2021
30/06/2023
$13.06
50%
n/a
1.30%
0.11%
Tranche B
Nil
2/02/2021
12/02/2021
30/06/2023
$13.06
50%
35%
1.30%
0.11%
Tranche D, F
Nil
12/02/2021
12/02/2021
30/06/2023
$12.06
50%
n/a
1.30%
0.11%
Tranche E
Nil
12/02/2021
12/02/2021
30/06/2023
$12.06
50%
35%
1.30%
0.11%
The fair value of STI performance rights, NED share rights and Restricted Shares at grant date is determined by
reference to the share price on grant date.
The valuation inputs for STI performance rights, NED share rights and Restricted Shares granted during the current
and prior year included:
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
(a) Exercise price
(b) Grant date
(c) Commencement of performance period
(d) Expiry date
(e) Share price at grant date
FY22 STI Rights
Tranche A
Nil
18/11/2021
01/07/2021
30/06/22
$10.49
Tranche B
Nil
13/10/2021
01/07/2021
30/06/22
$9.37
FY21 STI Rights
Tranche A
Nil
25/11/2020
1/07/2020
30/06/2021
$12.52
Tranche B
Nil
30/10/2020
1/07/2020
30/06/2021
$14.85
FY22 NED Share
Rights
Nil
30/07/2021
01/07/2021
30/06/2022
$10.47
FY21 NED Share
Rights
Nil
13/07/2020
1/07/2020
30/06/2021
$14.74
The expected volatility is based on the historic volatility over a period comparable to the remaining life of the
performance rights.
Total share based payments expense for the year ended 30 June 2022 was $11.5 million (2021: $13.0 million), which
included $1.8 million (2021: $2.4 million) in relation to the issue of shares under the employee share plan.
22 Remuneration of auditors
During the year the following fees were paid or payable for services provided by the auditor of the parent entity,
Northern Star Resources Limited, its related practices and non-related audit firms:
(a) Deloitte Touche Tohmatsu
Audit and review of financial reports
Group
Subsidiaries & joint arrangements
Total remuneration for audit and other assurance services
Other statutory assurance services
2022
$000
801.5
-
801.5
13.0
2021
$000
748.3
23.6
771.9
57.8
155
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Remuneration of auditors
Other services
Consulting services
Total services provided by Deloitte Touche Tohmatsu
(a) Other auditors and their related network firms
Audit and review of financial statements
Total auditor's remuneration
79.0
893.5
5.0
898.5
829.7
5.0
834.7
It is the Group's policy to employ Deloitte Touche Tohmatsu on assignments additional to their statutory audit duties
where Deloitte Touche Tohmatsu expertise and experience with the Group are important. These assignments are
principally tax advice and due diligence reporting on acquisitions, or where Deloitte Touche Tohmatsu is awarded
assignments on a competitive basis. It is the Group's policy to seek competitive tenders for all major consulting
projects.
23 Earnings per share
Basic earnings per share is calculated by dividing:
• the profit attributable to owners of the Company
• by the weighted average numbers of ordinary shares outstanding during the financial year, excluding treasury
shares.
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 additional ordinary shares that would have been outstanding assuming the
conversion of all dilutive potential ordinary shares.
(a) Basic earnings per share
156
30 June
2022
Cents
30 June
2021
Cents
Basic earnings per share attributable to the ordinary equity holders of the company
37.0
114.7
(b) Diluted earnings per share
30 June
2022
Cents
30 June
2021
Cents
Diluted earnings per share attributable to the ordinary equity holders of the
company
36.8
114.3
(c) Reconciliation of earnings used in calculating earnings per share
Basic earnings per share
Profit attributable to the ordinary equity holders of the Company
Diluted earnings per share
Profit attributable to the ordinary equity holders of the Company
30 June
2022
$M
429.8
429.8
30 June
2021
$M
1,032.5
1,032.5
Earnings per share
(d) Weighted average number of shares used as the denominator
2022
Number
2021
Number
Weighted average number of ordinary shares used as the denominator in
calculating basic earnings per share
1,162,290,284
900,489,284
Adjustments for calculation of diluted earnings per share:
Rights
Weighted average number of ordinary and potential ordinary shares used as the
denominator in calculating diluted earnings per share
6,162,312
3,094,790
1,168,452,596
903,584,074
24 Deed of cross guarantee
The Australian incorporated subsidiaries detailed in note 16 are each a party to a Deed of Cross Guarantee dated
14 May 2014, as varied (Deed), and have the benefit of ASIC relief from the requirements to prepare and lodge with
ASIC audited financial reports in accordance with Part 2M.3 of the Corporations Act, pursuant to ASIC Corporations
(Wholly-owned Companies) Instrument 2016/785 dated 17 December 2016 (Instrument).
Under the Deed, each entity in the Group guarantees to each creditor payment in full of any debt in the event of
winding up of any of the entities under certain provisions of the Corporations Act. In the event of a winding up of an
entity under other provisions of the Corporations Act, the other entities in the Group will only be liable to make up
any shortfall of funds if after six months any creditor has not been paid in full. The effect of the covenants given by
the entities under the Deed is to make the Company Group akin to a single legal entity from a financial perspective.
Closed Group:
•
•
•
•
•
•
•
•
•
•
•
•
•
Northern Star Resources Limited;
Northern Star (Kanowna) Pty Limited;
Northern Star (HBJ) Pty Ltd;
Northern Star (Holdings) Pty Ltd;
Northern Star (South Kalgoorlie) Pty Ltd;
Northern Star Mining Services Pty Limited;
Northern Star (KLV) Pty Limited;
Northern Star (Saracen) Pty Ltd;
Northern Star (Saracen Kalgoorlie) Pty Ltd;
Northern Star (Carosue Dam) Pty Ltd; and
Northern Star (Thunderbox) Pty Ltd;
Kalgoorlie Consolidated Gold Mines Pty Ltd
Northern Star (Saracen Goldfields) Pty Ltd;
Extended Closed Group:
• GKL Properties Pty Limited;
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Kanowna Mines Pty Limited;
Northern Star (Tanami) Pty Ltd;
Northern Star (Bronzewing) Pty Ltd;
Northern Star (Yandal Consolidated) Pty Ltd;
Northern Star (Echo Mining) Pty Ltd;
Northern Star (MKO) Pty Ltd;
Northern Star (Bundarra) Pty Ltd;
Northern Star (SR Mining) Pty Ltd;
Northern Star (Sinclair) Pty Ltd;
Northern Star (Talisman) Pty Ltd; and
Northern Star (GMK) Pty Ltd
Northern Star (Power) Pty Ltd
Northern Star (NPK) Pty Ltd
Northern Star (Holdings 2) Pty Ltd
157
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Deed of cross guarantee
25 Summary of significant accounting policies
The above companies represent the ‘closed group’ and the 'extended closed group' for the purposes of instrument
2016/785, which represent the entities who are parties to the deed of cross guarantee and which are controlled by
Northern Star Resources Limited.
With the exception of the amounts relating to Pogo's operations as disclosed at note 2, the consolidated statement
of profit or loss and other comprehensive income and statement of financial position for the closed group is
materially consistent with those of the consolidated entity.
This note provides a list of the significant accounting policies adopted in the preparation of these consolidated
consolidated financial statements to the extent they have not already been disclosed in the other notes above.
These policies have been consistently applied to all the years presented, unless otherwise stated. The consolidated
financial statements are for the Group consisting of Northern Star Resources Limited and its subsidiaries.
(a) Basis of preparation
These general purpose consolidated financial statements have been prepared in accordance with Australian
Accounting Standards and Interpretations issued by the Australian Accounting Standards Board and the
Corporations Act 2001. Northern Star Resources Limited is a for-profit entity for the purpose of preparing the
consolidated financial statements.
(i) Compliance with IFRS
Compliance with Australian Accounting Standards ensures that the financial statements and notes of the Company
and the Group complies with international financial reporting standards (IFRS).
(ii) Historical cost convention
The consolidated financial statements have been prepared on a historical cost basis, except for the following:
•
financial assets at fair value through other comprehensive income, financial assets and liabilities (including
derivative instruments); and
(iii) New and amended standards adopted by the group
The Group has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
With the exception of AASB 2018-6 Amendments to Australian Accounting Standards - Definition of a Business, any
new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early
adopted. Refer to note for details of changes to accounting policies in the current financial year.
Any significant impact of the accounting policies of the Group from the adoption of these Accounting Standards
and Interpretations are disclosed below.
158
(iv) Accounting Standards issued but not yet effective
The following changes in Accounting Standards have been issued but are not yet effective:
159
AASB 116 Property, Plant and Equipment. A change to the treatment of proceeds which are received from selling
gold recovered from a mine before that mine is considered capable of operating in the manner intended by
management (i.e. pre-commercial production). Under the current guidelines, in respect of pre commercial
production, revenue and the associated cost of sale is excluded from profit or loss (earnings) and are included in
capital (balance sheet) and offset against the costs of developing the mine.
The changes referred to above must be adopted by the Group from 1 July 2022, including the required restatement
of comparatives for mines that were deemed in pre commercial production phase before 1 July 2021 (being the
start of the earliest comparative period).
The changes will require sales proceeds, along with their cost of sale, to be recognised in profit or loss (earnings). The
cost of sale must be determined with respect to the accounting rules for measurement of inventory. This will require
the Company to allocate some of the costs during the pre-commercial production phase to operating activities
(producing saleable gold), whereas under the current guidelines all such costs have been treated as capital. As
required by Accounting Standards, depreciation of mine properties will continue to only commence when an asset
is placed into commercial production. Consequently, cost of sales expensed on sale of gold during a
pre-commercial production phase will not include depreciation charges.
The required changes outlined above are expected to increase revenues and bring forward the recognition of costs
to the income statement (which may increase or decrease profit and loss depending on whether the revenues
generated are greater than the costs of sale). Over the life of a mining project the net impact to profit and loss will
be nil, however the proportional allocation of expenses between mining, processing and other costs and
depreciation will alter due to the change in treatment outlined above.
In the FY22 period, pre commercial production areas contributed $70.9 million of revenue, and $38.9 million of cost
of sales, which has been offset against the mine development asset in the current year.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Summary of significant accounting policies
(b) Principles of consolidation
(i)
Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an
entity where the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has
the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date
that control ceases.
Intercompany transactions, balances and unrealised gains and losses on transactions between Group companies
are eliminated.
The consolidated consolidated financial statements incorporate the assets and liabilities of all subsidiaries of
Northern Star Resources Limited ('Company' or 'parent entity') as at 30 June 2022 and the results of all subsidiaries for
the year then ended. Northern Star Resources Limited and its subsidiaries together are referred to in this financial
report as the Group or the consolidated entity.
(ii)
Joint arrangements
Under AASB 11 Joint Arrangements investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal
structure of the joint arrangement. Northern Star Resources Limited has only joint operations. A joint operation is a
joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and
obligations for the liabilities, relating to the arrangement. Joint control is the contractually agreed sharing of control
of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the
parties sharing control.
Joint operations
Northern Star Resources Limited Limited recognises its direct right to the assets, liabilities, revenues and expenses of
joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have
been incorporated in the financial statements under the appropriate headings. Details of the joint operation are set
out in note 15(b).
(iii) Changes in ownership interests
160
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with
equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts
of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference
between the amount of the adjustment to non-controlling interests and any consideration paid or received is
recognised in a separate reserve within equity attributable to owners of Northern Star Resources Limited.
When the Group ceases to consolidate or equity account for an investment because of a loss of control, joint
control or significant influence, any retained interest in the entity is remeasured to its fair value with the change in
carrying amount recognised in profit or loss. This fair value becomes the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any
amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the
Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in
other comprehensive income are reclassified to profit or loss.
(c) Foreign currency translation
(i)
Functional and presentation currency
Items included in the consolidated 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 consolidated financial statements are presented in Australian dollar ($), which is Northern Star
Resources Limited's functional and presentation currency.
(d) Business combinations
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity
instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises
the
•
•
•
fair values of the assets transferred
liabilities incurred to the former owners of the acquired business
equity interests issued by the Group
Summary of significant accounting policies
(d) Business combinations (continued)
•
•
fair value of any asset or liability resulting from a contingent consideration arrangement, and
fair value of any pre-existing equity interest in the subsidiary.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with
limited exceptions, measured initially at their fair values at the acquisition date. The Group recognises any
non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the
non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the:
•
•
•
consideration transferred,
amount of any non-controlling interest in the acquired entity, and
acquisition-date fair value of any previous equity interest in the acquired entity
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the
fair value of the net identifiable assets of the business acquired, the difference is recognised directly in profit or loss
as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to
their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate,
being the rate at which a similar borrowing could be obtained from an independent financier under comparable
terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability
are subsequently remeasured to fair value with changes in fair value recognised in profit or loss.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously
held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from
such remeasurement are recognised in profit or loss.
The excess of the consideration transferred and the amount of any non-controlling interest in the acquiree over the
fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value
of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the
difference is recognised directly in profit or loss as a bargain purchase.
(e) Impairment of assets
At each reporting date, the Group reviews the carrying amounts of its tangible and other intangible assets to
determine whether there is any indication that those assets might be impaired. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any) which is
the amount by which the assets carrying value exceeds its recoverable amount. Where the asset does not generate
cash in-flows that are independent from other assets, the Group estimates the recoverable amount of the
cash-generating unit (CGU) to which the asset belongs.
The recoverable amount is the higher of fair value less costs to sell (FVLCS) and value in use. In assessing value in use,
the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset for which the estimates of
future cash flows have not been adjusted.
If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount
of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss
immediately.
Where an impairment loss subsequently reverses for assets other than goodwill, the carrying amount of the asset (or
CGU) 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 (or CGU) in prior years. A reversal of an impairment loss is recognised in profit or loss
immediately.
161
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Summary of significant accounting policies
(e) Impairment of assets (continued)
Estimates of quantities of recoverable minerals, production levels, operating costs and capital requirements are
sourced from out planning process, including the LOM plans, five-year plans, one-year budgets and CGU-specific
studies.
The determination of FVLCS for each CGU are considered to be Level 3 fair value measurements, as they are
derived from valuation techniques that include inputs that are not based on observable market data. The Group
considers the inputs and the valuation approach to be consistent with the approach taken by market participants.
(f) Non-current assets (or disposal groups) held for sale and discontinued operations
Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use and a sale is considered highly probable.
They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as
deferred tax assets, assets arising from employee benefits, financial assets and investment property that are carried
at fair value and contractual rights under insurance contracts, which are specifically exempt from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to fair value
less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset (or
disposal group), but not in excess of any cumulative impairment loss previously recognised. A gain or loss not
previously recognised by the date of the sale of the non-current asset (or disposal group) is recognised at the date
of derecognition.
Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while they
are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified
as held for sale continue to be recognised.
Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are
presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held
for sale are presented separately from other liabilities in the balance sheet.
162
A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and
that represents a separate major line of business or geographical area of operations, is part of a single co-ordinated
plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to
resale. The results of discontinued operations are presented separately in the statement of profit or loss. The assets
classified as held for sale as at 30 June 2021, as disclosed at note 15, do not represent a separate major line of
business or geographical area of operations and therefore are not deemed to be a discontinued operation.
(g) Investments and other financial assets
(i) Classification
The Group classifies its financial assets in the following measurement categories:
•
•
those to be measured subsequently at fair value (either through OCI or through profit or loss), and
those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual
terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in
equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable
election at the time of initial recognition to account for the equity investment at fair value through other
comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing those assets changes.
(ii) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at
fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash
flows are solely payment of principal and interest.
Summary of significant accounting policies
(g) Investments and other financial assets (continued)
(ii) Measurement (continued)
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and
the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its
debt instruments:
•
•
•
Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. Interest income from these financial
assets is included in finance income using the effective interest rate method. Any gain or loss arising on
derecognition is recognised directly in profit or loss and presented in other gains/(losses) together with foreign
exchange gains and losses. Impairment losses are presented as separate line item in the consolidated
statement of profit or loss.
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where the
assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in
the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is
derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss
and recognised in other gains/(losses). Interest income from these financial assets is included in finance income
using the effective interest rate method. Foreign exchange gains and losses are presented in other
gains/(losses) and impairment expenses are presented as separate line item in the consolidated statement of
profit or loss.
FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss on a
debt investment that is subsequently measured at FVPL is recognised in profit or loss and presented net within
other gains/(losses) in the year in which it arises.
Equity instruments
The Group subsequently measures all equity investments at fair value. Where the Group’s management has elected
to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair
value gains and losses to profit or loss following the derecognition of the investment. Dividends from such
investments continue to be recognised in profit or loss as other income when the Group’s right to receive payments
is established.
163
Changes in the fair value of financial assets at FVPL are recognised in other gains/(losses) in the consolidated
statement of profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments
measured at FVOCI are not reported separately from other changes in fair value.
(iii)
Impairment
From 1 July 2021, the Group assesses on a forward looking basis the expected credit losses associated with its debt
instruments carried at amortised cost and FVOCI. The Group applies the simplified approach permitted by AASB 9
Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the
receivables.
(h) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or
as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the taxation authority is included with other receivables or payables in the
Statement of Financial Position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing
activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.
(i) Rounding of amounts
The Company is of a kind referred to ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of amounts in
the financial statements. Amounts in the financial statements have been rounded off in accordance with the
instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 FINANCIAL rePOrT
FINANCIAL rePOrT
Parent entity financial information
(e) Determining the parent entity financial information (continued)
(ii)
Tax consolidation legislation (continued)
The entities have also entered into a tax funding agreement under which the wholly-owned entities fully
compensate Northern Star Resources Limited for any current tax payable assumed and are compensated by
Northern Star Resources Limited for any current tax receivable and deferred tax assets relating to unused tax losses
or unused tax credits that are transferred to Northern Star Resources Limited under the tax consolidation legislation.
The funding amounts are determined by reference to the amounts recognised in the wholly-owned entities’
consolidated financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice
from the head entity, which is issued as soon as practicable after the end of each financial year. The head entity
may also require payment of interim funding amounts to assist with its obligations to pay tax instalments.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as current
amounts receivable from or payable to other entities in the Group.
Any difference between the amounts assumed and amounts receivable or payable under the tax funding
agreement are recognised as a contribution to (or distribution from) wholly-owned tax consolidated entities.
165
26 Parent entity financial information
(a) Summary financial information
The individual consolidated financial statements for the parent entity, Northern Star Resources Limited, show the
following aggregate amounts:
Balance sheet
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Shareholders' equity
Issued capital
Reserves
Financial assets at fair value through OCI
Cash flow hedges
Share-based payments
Share of other comprehensive income of associates and joint ventures
accounted for using the equity method
Retained earnings
Profit for the year
30 June
2022
$M
632.5
7,459.6
8,092.1
(282.5)
(927.8)
(1,210.3)
30 June
2021
$M
445.6
7,121.2
7,566.8
(206.4)
(1,081.6)
(1,288.0)
6,435.0
6,436.1
13.0
(0.3)
15.2
-
418.9
462.2
11.2
0.4
15.6
0.1
(184.5)
(144.2)
Total comprehensive income
462.2
(172.1)
(b) Guarantees entered into by the parent entity
164
Refer to note 24 for details of guarantees entered into by the parent entity in relation to the debts of its subsidiaries.
(c) Contingent liabilities of the parent entity
Refer to note 17 for details of contingent liabilities relating to the parent entity as at 30 June 2022 or 30 June 2021.
(d) Contractual commitments for the acquisition of property, plant or equipment
Refer to note 18 for commitments of the Group for the acquisition of property, plant and equipment as at 30 June
2022 or 30 June 2021.
(e) Determining the parent entity financial information
The financial information for the parent entity, Northern Star Resources Limited, has been prepared on the same
basis as the consolidated consolidated financial statements, except as set out below.
(i)
Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the consolidated
financial statements of Northern Star Resources Limited.
(ii)
Tax consolidation legislation
Northern Star Resources Limited and its wholly-owned Australian controlled entities have implemented the tax
consolidation legislation.
The head entity, Northern Star 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.
In addition to its own current and deferred tax amounts, Northern Star Resources Limited also recognises the current
tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed
from controlled entities in the tax consolidated Group.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 DIreCTOrS’ DeCLArATION
Directors’ Declaration
166
DIRECTORS’ DECLARATION
In the Directors' opinion:
(a)
(b)
(c)
(d)
There are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable;
The financial statements and notes for the year ended 30 June 2022 set out on pages 106 to
165 (FY22 Financial Report) comply with the Corporations Act 2001 (Cth), the Corporations
Regulations 2001, Australian Accounting Standards and international financial reporting
standards, and other mandatory professional reporting requirements;
The FY22 Financial Report gives a true and fair view of the consolidated entity's financial
position as at 30 June 2022 and of its performance for the year ended on that date; and
At the date of this declaration, there are reasonable grounds to believe that the members
of the extended closed group identified in Note 24 will be able to meet any obligations
or liabilities to which they are, or may become, subject by the virtue of the deed of cross
guarantee described in Note 24.
Note 25 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 Managing Director & Chief Executive Officer
and the Chief Financial Officer required by section 295A of the Corporations Act 2001 (Cth).
This declaration is made in accordance with a resolution of Directors.
MICHAEL CHANEY AO
Chairman
Northern Star Resources Limited
28 August 2022
ABN: 43 092 832 892
Registered Office: Level 1, 388 Hay Street, Subiaco 6008, Western Australia
PO Box 2008, Subiaco 6904, Western Australia
Tel: +61 8 6188 2100 Fax: +61 8 6188 2111 Email: info@nsrltd.com Web: www.nsrltd.com
Sunset over the Mt Charlotte
Underground Operation,
Cassidy Shaft Headframe at
KCGM, Kalgoorlie Production
Centre, Western Australia
167
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 INDePeNDeNT AUDITOr'S rePOrT
INDePeNDeNT AUDITOr'S rePOrT
Independent Auditor's report to the members
168
169
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 INDePeNDeNT AUDITOr'S rePOrT
INDePeNDeNT AUDITOr'S rePOrT
Independent Auditor's report to the members (continued)
170
171
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 INDePeNDeNT AUDITOr'S rePOrT
Independent Auditor's report to the members (continued)
Visible gold found at Jundee,
Yandal Production Centre,
Western Australia
172
173
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Corporate
Information
COrPOrATe INFOrMATION
COrPOrATe INFOrMATION
HSBC Custody Nominees (Australia) Limited
7,664,224
Shareholder Information
Table 24 Top 20 holders of ordinary shares at 25 August 2022
#
Name
1
2
3
4
5
6
7
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
Citicorp Nominees Pty Limited
BNP Paribas Noms Pty Ltd
National Nominees Limited
Citicorp Nominees Pty Limited
BNP Paribas Nominees Pty Ltd
8 Wroxby Pty Limited
9
10
11
12
13
14
15
16
17
18
176
BNP Paribas Nominees Pty Ltd acf Clearstream
HSBC Custody Nominees (Australia) Limited - A/C 2
BNP Paribas Nominees Pty Ltd
Pacific Custodians Pty Limited
National Nominees Limited
Pacific Custodians Pty Limited
Netwealth Investments Limited
BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd
UBS Nominees Pty Ltd
19 Mutual Trust Pty Ltd
20 Mr Hendricus Petrus Indrisie
Total Top 20 holders
Balance of register
Total register
Table 25 Distribution of ordinary shares at 25 August 2022
Shares
% Issued
capital
479,917,699
41.19
197,644,127
16.96
109,181,049
41,306,457
35,111,829
17,865,307
13,633,368
10,843,278
5,316,032
3,288,119
3,213,838
2,490,642
2,306,062
2,262,314
2,214,102
1,899,415
1,606,522
1,517,594
1,400,000
9.37
3.55
3.01
1.53
1.17
0.93
0.66
0.46
0.28
0.28
0.21
0.20
0.19
0.19
0.16
0.14
0.13
0.12
940,681,978
80.74
224,444,244
19.26
1,165,126,222
100.00
Shares
% Shares
Holders
% Holders
Holding
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
11,820,236
45,769,241
28,912,638
76,023,530
100,001 and over
1,002,600,577
Total
1,165,126,222
1.01
3.93
2.48
6.52
86.05
100.00
28,336
18,999
3,960
3,195
236
54,726
51.78
34.72
7.24
5.84
0.43
100.00
There were no holders of less than a marketable parcel of $500 based at closing market price at 25 August 2022.
Table 26 Substantial holders at 5 August 2022 (latest available)
#
1
2
Name
BlackRock Inc
VanEck Inc
Table 27 Restricted securities at 25 August 2022
Class
Shares 1
Shares 2
Shares3
Shares 4
Shares 5
Number
40,170
140,668
229,078
171,452
35,000
Table 28 Unquoted equity securities at 25 August 2022
Class
Unvested Performance Rights
issued under the FY20 Share Plan
(NSTAA)
Number6
4,356,950
Voting rights
Share
% Issued
capital
139,490,313
77,675,122
11.97
6.75
Date escrow period ends
26 June 2023
18 June 2024
24 June 2025
30 June 2023
5 July 2023
Holders
138
177
The voting rights attaching to each class of equity
securities are set out below:
Performance Rights:
No voting rights.
Ordinary shares:7
On a show of hands every member present at a
meeting in person or by proxy shall have one vote
and upon a poll each share shall have one vote.
NED Share Rights:
No voting rights.
On-market buy-back
The Board approved an on-market share buy-back
of up to $300 million to be completed over the
12 month period from 15 September 2022.
See Note 19 to the financial statements for
further details.
1. Shares issued under the Employee Share Plan Rules No.3 (approved in June 2017) on 26 June 2020.
2. Shares issued under the Employee Share Plan Rules No.3 (approved in June 2017) on 18 June 2021.
3. Shares issued under the Employee Share Plan Rules No.3 (approved in June 2017) on 24 June 2022.
4. Shares issued to Saracen employees as part of the merger on 12 February 2021 subject to holding lock.
5. Share issued under the FY20 Retention Share Plan on 12 July 2021.
6. Number of unissued ordinary shares under the Performance Rights. No person holds 20% or more of these securities.
7. Zero percent of the Company’s issued share capital is composed of non-voting shares.
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 COrPOrATe INFOrMATION
COrPOrATe INFOrMATION
178
Glossary
ASX
Australian Securities Exchange Ltd
ASX Corporate Governance
Principles and recommendations
Principles and Recommendations
(4th edition) of the ASX Corporate
Governance Council on the
corporate governance practices to
be adopted by ASX listed entities
and which are designed to promote
investor confidence and to assist
listed entities to meet shareholder
expectations
Au
The chemical symbol for gold
Auditor
The auditor of the Company duly
appointed under the Corporations
Act 2001 (Cth)
Australian Accounting Standards
Australian Accounting Standards
are developed, issued and
maintained by the Australian
Accounting Standards Board, an
Australian Government agency
under the Australian Securities
and Investments Commission
Act 2001 (Cth)
B or bn
Billion
Board
Board of Directors
C$
Canadian dollars
Cash earnings
Underlying EBITDA less net
interest, tax and sustaining capital
CeO
Chief Executive Officer
Company
Northern Star Resources Limited
ABN 43 092 832 892
contractors
individuals who are employed
by other companies, or, other
companies, who provide services to
the Group to support its operations
Corporations Act
Corporations Act 2001 (Cth)
Core Values
Northern Star’s Core Values of
Safety, Teamwork, Accountability,
Respect and Results
Director
A director of the Company duly
appointed under the Corporations
Act
eAP
Employee assistance providers(s)
employees
Total number of employees of
the Group including permanent,
fixed term and part-time. Does not
include contractors
ePS
Earnings per Share
eSG
Environmental, Social &
Governance
eSr
Environment & Social
Responsibility
eSS
Environmental, Social & Safety
FY20
Financial year ended
30 June 2020
FY21
Financial year ended
30 June 2021
FY22
Financial year ended
30 June 2022
FY23
Financial year ending
30 June 2023
GhG
Greenhouse gases
gpt
Grams per tonne
Group
Northern Star Resources Limited
and all of its wholly owned
subsidiaries as at 30 June 2022
Incident
means the partial or whole damage
or destruction of an area of cultural
or heritage significance without
Traditional Owner consent and/
or required legal or regulatory
approvals
Indicated Mineral resource
As defined in the JORC Code
Inferred Mineral resource
As defined in the JORC Code
International Financial reporting
Standards (IFrS)
A single set of accounting
standards, developed and
maintained by the IASB with the
intention of those standards being
capable of being applied on a
globally consistent basis
JOrC Code
Australasian Code for Reporting
of Exploration Results, Minerals
Resources and Ore Reserves 2012
Edition, prepared by the Joint
Ore Reserves Committee of The
Australasian Institute of Mining and
Metallurgy, Australian Institute of
Geoscientists and Minerals Council
of Australia
K or k
Thousand
KCGM
KCGM means Kalgoorlie
Consolidated Gold Mines Pty
Ltd, a wholly owned subsidiary
of the Company, which operates
the Super Pit and Mt Charlotte
underground operations in
Kalgoorlie, Western Australia
Key Management
Personnel or KMP
Defined in the Australian
Accounting Standards as those
persons having authority and
responsibility for planning,
directing and controlling the
activities of the entity, directly or
indirectly, including any director
(whether executive or otherwise) of
that entity
koz
Thousand ounces
Kundana Assets
Refers to the Kundana Operations,
a 51% interest in each of the East
Kundana Production Joint Venture
and the East Kundana Exploration
Joint Venture, a 75% interest in
the West Kundana Farmin Joint
Venture, and the Carbine/ Carnage
gold project, that Northern Star
sold to Evolution Mining Ltd ABN
74 084 669 036 which completed
on 18 August 2021
LTIFr
Lost Time Injury Frequency Rate;
calculated based on the number
of reportable lost time injuries
occurring in a workplace per 1
million hours worked
M or m
Million
MD
Managing Director
Measured Mineral resource
As defined in the JORC Code
merger
The merger of Saracen Mineral
Holdings Limited ABN 52 009 215
347 and all of its wholly owned
subsidiaries with Northern Star by
way of Scheme of Arrangement
implemented on 12 February 2021
Mineral resource or resource
As defined in the JORC Code
Net Zero
Net Zero refers to achieving a
balance between the amount of
operational Scope 1 and Scope
2 GHG Emissions produced and
those removed.
Net Zero Ambition
Our Net Zero Ambition is our
ambition to achieve Net Zero by
2050, as expressed in our Climate
Change Policy available on our
website.
NPAT
Net profit after tax
Northern Star
Northern Star Resources Limited
ABN 43 092 832 892
NSMS
Northern Star Mining Services Pty
Ltd, a wholly owned subsidiary
of the Company, dedicated to
underground mining operations
NST
Northern Star Resources Limited
ABN 43 092 832 892
Officer
An officer of the Company defined
under the Corporations Act
Ore reserve or reserve
As defined in the JORC Code
Performance rights
Performance Rights are rights
to receive Shares in the future if
certain performance hurdles are
met
Scope 3 emissions
Indirect greenhouse gas emissions
other than Scope 2 emissions
that are generated in the wider
economy. They occur as a
consequence of the activities
of a facility, but from sources
not owned or controlled by that
facility's business
Share
Fully paid ordinary share in
Northern Star Resources Limited
shareholder
A shareholder of Northern Star
Resources Limited
Probable Ore reserve
As defined in the JORC Code
SKO
South Kalgoorlie Operations
Proved Ore reserve
As defined in the JORC Code
Quarter or Q
Financial year quarter, commencing
either 1 July, 1 October, I January
or 1 April
restricted Share
A Share subject to Share trading
restrictions
SAr
Saracen Mineral Holdings Limited
ABN 52 009 215 347
SASB
Sustainability Accounting
Standards Board
Saracen
Saracen Mineral Holdings Limited
ABN 52 009 215 347 and all of
its wholly owned subsidiaries,
as acquired by Northern Star by
way of Scheme of Arrangement
implemented on 12 February 2021
Scope 1 emissions
Emissions released to the
atmosphere as a direct result of an
activity, or series of activities at a
facility level
Scope 2 emissions
Emissions released to the
atmosphere from the indirect
consumption of an energy
commodity
stakeholders
An individual, group or organisation
that is impacted by the Company,
or has an impact on the Company.
Examples of stakeholders are
investors, employees, suppliers and
local communities
STArr
Our Core Values of Safety,
Teamwork, Accountability, Respect
and Results
Suppliers
External companies engaged by
Northern Star to supply goods to
the operations
TCFD
Task Force on Climate-related
Financial Disclosures
TrIFr
Total Reportable Injury Frequency
Rate; calculated according to
the number of reportable work -
related injuries or illness for each
one million hours worked
Underlying eBITDA
Net profit after tax, before interest,
tax depreciation and amoritisation
adjusted for specific items
$
Australian dollars, unless the
context says otherwise. All A$ to
$US currency conversions used in
this Annual Report are at $0.70
179
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 Julius Drake-Brockman, Open
Pit Manager at Carosue Dam,
Kalgoorlie Production Centre,
Western Australia
COrPOrATe INFOrMATION
Corporate Information
Northern Star Resources Limited
ABN: 43 092 832 892
Directors (as at 30 June 2022)
Michael Chaney AO
Stuart Tonkin
John Fitzgerald
Mary Hackett*
Nick Cernotta
Sally Langer
John Richards
Sharon Warburton
Chairman
Managing Director & CEO
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
*Retired from Board on 22 August 2022
Company Secretary
Hilary Macdonald
Chief Legal Officer & Company Secretary
registered Office & Principal Place of Business
180
Level 1, 388 Hay Street Subiaco WA 6008 Australia
Telephone: +61 8 6188 2100
Facsimile: +61 8 6188 2111
Website: www.nsrltd.com
Email: info@nsrltd.com
Share registry
Link Market Services Limited
Level 12, QV1 Building, 250 St Georges Terrace Perth WA 6000 Australia
Telephone: +61 1300 554 474
Website: www.linkmarketservices.com.au
Auditors
Deloitte Touche Tohmatsu
Brookfield Place, Tower 2, 123 St Georges Terrace Perth WA 6000 Australia
registration & Listing
Incorporated in Western Australia on 12 May 2000
Quoted on the Official List of the Australian Securities Exchange (ASX: NST)
Securities exchange
ASX Limited
Level 40, Central Park, 152-158 St Georges Terrace Perth WA 6000 Australia
ASX Code
NST
NORTHERN STAR RESOURCES LIMITED ANNUAL REPORT 2022 nsrltd.com
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