ABN 11 127 171 877
Annual
Report
2023
02
Predictive Discovery Limited
Contents
Overview
Highlights
About PDI
Our Values
Chairman’s Letter
Strategic Report
Managing Director’s Report and
Review of Activities
Mineral Resources and Ore Reserves Statement
Sustainability Review
Financial Statements
Directors’ Report
Statement of Profit or Loss and
Other Comprehensive Income
Statement of Financial Position
Statement of Changes In Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Auditor’s Independence Declaration
Additional information
Shareholders Information
Mineral Tenement Information
Corporate Directory
03
04
05
06
10
18
20
28
44
45
46
47
48
75
76
81
84
89
90
Annual Report 2023
03
Highlights
Delivering on
our promises.
PDI is focused on delivering long-term
sustainable value to our shareholders
and stakeholders via the development
of the Bankan Gold Project in the
Siguiri Basin, Guinea.
Durimg the year, PDI’s exploration program delivered
excellent results, with a significant increase and
upgrade to the Mineral Resource, strengthening our
position to deliver a Scoping Study in late 2023 and
secure an Exploitation Permit in the first half of 2024.
83,000m of resource definition
drilling was completed at
the North East Bankan
(NEB) and Bankan Creek
(BC) deposits in FY23
Mineral Resources at NEB
and BC increased to 5.38Moz
Au including 4.14Moz in
the Indicated category
$40m oversubscribed equity
raise completed in June 2023
to advance and drive growth
at the Bankan Gold Project,
with up to $20m allocated
to regional exploration
Increased focus on Bankan’s significant exploration potential:
11 drill targets identified at
Argo from extensive regional
auger drilling and geophysics
surveys – drilling underway
Drilling is also ongoing at
multiple targets near the
NEB and BC deposits
Key surveys and studies
completed for the
Environmental & Social
Impact Assessment (ESIA),
which is on schedule to be
completed in late 2023
Annual environmental
authorisation for the Bankan
Project renewed by the
Minister for Environment and
Sustainable Development
Established an ESG
Board Committee
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
04
Predictive Discovery Limited
About PDI
PDI is focused on identifying and
developing gold deposits within
the Siguiri Basin, Guinea.
The Company’s key asset is the Tier-1 Bankan Gold
Project in Guinea, which is the largest gold discovery in
West Africa in a decade. With a growing resource base
of over 5.38Moz Au (4.14Moz indicated and 1.24Moz
inferred)1, PDI’s strategy is to sustainably bring Bankan
into production whilst identifying and developing
other deposits within this underexplored region.
In parallel with ongoing drilling to increase the
size and improve the classification of the current
resource, PDI has launched a range of studies and
programs, to progress the Bankan Gold Project
towards development. Baseline social, environmental
and biodiversity studies have been completed as
part of an extensive ESG program. A Scoping Study is
underway and due to be completed in late 2023.
The Bankan permits, which contain a 35km long
gold super-structure, are highly prospective for
additional discoveries. PDI is ramping up its near-
resource and regional exploration efforts, with
multiple targets being tested by drilling.
Investment case
Largest gold discovery in West Africa in a
decade, with a 5.38Moz Mineral Resource1
defined at NEB and BC
Significant potential to grow the current
Mineral Resource at NEB, BC and near-
resource targets
Prospective for additional large-scale
discoveries along the 35km gold bearing
super structure within Bankan’s permits
Rapidly advancing towards development,
with Scoping Study and ESIA to be
completed in late 2023 to facilitate
securing an Exploitation Permit in
the first half of 2024
Highly experienced Board and
Management team have developed and
operated numerous gold mines in Africa,
including in Guinea
Guinea is an established mining address,
with significant production of bauxite
and gold. PDI has the full backing
of the Guinean government
Well-funded and a supportive
shareholder base, following completion
of a $40m oversubscribed equity raising
in mid-2023
Positioned to become one of Guinea’s
largest gold producers within 5 years
1
ASX announcement – Bankan Mineral Resource Increases to 5.38Moz (7 August 2023).
Annual Report 2023
05
Our Values
PDI is defined by its core values
of Respect – for the environment,
individuals and community, Teamwork
and Excellence.
These are the values that guide our internal
decision making and our relationships with external
stakeholders. We aim to not only protect but to
promote and champion the regions, environments
and communities within which we work.
PDI plans to unlock the benefits of the deposits for
all stakeholders. By putting in place the right people
and the right processes, we aim to develop a mine
that delivers long-term sustainable growth.
Respect
for the environment
We are committed to
environmental stewardship
and responsible management
of natural resources, we strive
to minimise our impact on
the local environment as we
progress towards the Scoping
Study and development of
the Bankan Gold Project.
for individuals
We are dedicated to upholding
the rights and well-being of
every person we encounter,
from our employees to our
partners and the communities
we serve, fostering a culture of
inclusivity, fairness, and mutual
respect in all our operations.
for community
At PDI, we recognise that our
success is intrinsically linked
to the well-being of the local
community. We take pride in
the ability we have to leave a
positive and lasting impact on
the local areas that we work in.
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
Teamwork
Together with our contractors,
our collaborative efforts have
driven our achievements and
enabled us to successfully
progress through our exploration
programme. Together, we are
stronger, more innovative, and
better equipped to provide
exceptional results and to
deliver on the Company strategy.
Excellence
We continuously strive for
the highest standards of
performance. It is through this
dedication to excellence that we
not only meet but exceed the
expectations of our stakeholders
as we plan to deliver on the
strategy with the target of
securing the Exploitation Permit
in H1 2024
06
Predictive Discovery Limited
Chairman’s Letter
Simon Jackson
Non-Executive Chairman
Dear shareholders and stakeholders,
I am pleased to introduce the 2023
annual report, a year in which PDI has
made excellent progress with the
Bankan Gold Project.
The Bankan Project has all the hallmarks of a future
Tier-1 gold mine, which brings enormous opportunity for
the Company and its shareholders, but also significant
responsibility. In this regard, PDI is committed to
sustainably developing Bankan into a large-scale and
long-life mine, which has the potential to positively
impact our host country, Guinea, and contribute to the
progressive development of our local communities.
Upon joining the Board in October 2021, it was clear
to me that PDI was at an inflexion point and needed
to transition rapidly from a highly successful explorer
to a disciplined developer. Together with Andrew
Pardey, who took on the Managing Director role at
the start of 2022, a comprehensive roadmap was
established to secure an Exploitation Permit for
the Project, which included the key milestone of
completing a Scoping Study by the end of 2023.
I am pleased to report that we are now more than
18 months into this journey and remain on track to
complete the Scoping Study later this year and apply
for the Exploitation Permit in the first half of 2024.
Crucial to the Scoping Study, PDI has completed
extensive resource definition drilling during FY23 and
has significantly grown the Bankan Mineral Resource to
5.38Moz, importantly including 4.14Moz in the Indicated
category, a vital component of understanding the
extraordinary geological endowment of the Bankan
Project. Key environmental, social and technical
studies were significantly advanced during the year.
In addition, and with the considerable support of our
shareholders, PDI has embarked upon one of Guinea’s
largest exploration campaigns to further unlock the
potential of the highly prospective Bankan permits.
I would like to thank Andrew, the entire PDI team
and the Company’s key contractors and consultants,
who have worked diligently to get to this point. There
is no doubt that PDI is well-placed with Andrew
at the helm to draw on his unique combination of
experience in mine development in the Guinean
gold industry, as well as building and running
one of Africa’s largest gold-producing mines.
From a Board perspective, we enhanced our governance
during the year, establishing a Nomination and
Remuneration Committee and an Audit Committee.
Importantly, PDI has also established an ESG Committee
to provide Board-level guidance and oversight of PDI’s
crucial sustainability strategy. As a rapidly growing
public company, we fully recognise the need for strong
corporate governance and working closely with our
shareholders in aligning their needs with our sustainable
development goals, which will positively impact all
of our stakeholders. Improvements have been made
in line with the rapid development of your Company
over the past year, particularly with our engagement
with shareholders on all aspects of the business,
which has significantly improved transparency in our
sustainability and remuneration reporting. We also
recognise the need for continuous improvement in
how we align the interests of all our stakeholders and
will continue to strive towards those objectives.
I would like to thank our shareholders and key
stakeholders for your ongoing support. In particular, I
would like to thank the various Guinean government
authorities and the local communities. Your support
and guidance will assist in making the Bankan
Gold Project a success for all stakeholders.
I look forward to FY24, which will be the
most defining year in PDI’s history.
Yours sincerely
Simon Jackson
Non-Executive Chairman
Annual Report 2023
07
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
08
Predictive Discovery Limited
Strategic
Report
Annual Report 2023
09
Managing Director’s Report and
Review of Activities
Mineral Resources and Ore Reserves Statement
Sustainability Review
10
18
20
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
10
Predictive Discovery Limited
Managing Director’s Report
and Review of Activities
Andrew Pardey
Managing Director
It is with great pleasure that I present
the Managing Director’s report and
review of activities for the 2023
financial year (FY23).
PDI’s strategy is to sustainably develop the Bankan
Gold Project into West Africa’s next Tier-1 gold
mine, whilst continuing to unlock the significant
exploration potential that exists within the permits.
I’m delighted to report that we have made
excellent progress on both fronts during FY23.
Since taking on the Managing Director’s role in
January 2022, the PDI team has been considerably
strengthened and aligned with our core strategy
of advancing the Bankan Project rapidly and
sustainably towards the development phase.
The crucial short-term milestone is being awarded
the Exploitation Permit for the Bankan Gold Project
in the first half of 2024. FY23 saw PDI consolidate its
trajectory towards reaching that milestone through
project, financial and sustainability metrics, with
the achievements made providing solid foundations
for the critical financial year that lies ahead.
During FY23 we completed extensive resource definition
drilling at our NEB and BC deposits, where we have
successfully increased and upgraded the Mineral
Resources, with 4.14Moz defined as Indicated within our
August 2023 estimate of 5.38Moz. Simultaneous with the
highly successful infill drilling campaign, PDI implemented
our environmental and social studies, which are being
undertaken to international best practice standards.
The work achieved on both these critical aspects of
our business is fundamental to the requirements of
the Scoping Study to be submitted to our Guinean
stakeholder groups towards the end of this calendar year.
This review summarises the progress that
PDI has made during FY23 and more recently,
as we push forward with our strategy.
Resource definition at NEB and BC
The NEB and BC discoveries are the backbone of
the Company and have the critical mass to support
a large-scale, long-life and sustainable operation.
In line with the Company’s aim to rapidly move
Bankan towards the development phase, growing and
upgrading the Mineral Resource has been a significant
focus for the Company. 83,000m of resource definition
drilling was completed at the NEB and BC deposits
during FY23, one of the largest drilling campaigns
for a gold company in Guinea. A key focus of these
drilling programs has been to maximise the amount
of Indicated Mineral Resource, which has substantially
increased our understanding of what PDI will be mining
and how it will be mined, both critical components
of the Scoping Study due before the end of 2023.
Two Mineral Resource updates were completed during
FY23 as well as a third update in August 2023. The
updates are summarised below with the chart showing
the evolution of the Mineral Resource estimate over time.
In August 2022, a Mineral Resource update was
announced for the NEB deposit, increasing the overall
Bankan Project Mineral Resource to 79.5Mt @ 1.63g/t
for 4.2Moz (Inferred). This represented a 15% increase
compared to the maiden Mineral Resource estimate
of 3.65Moz announced in September 2021, with
the NEB Mineral Resource increasing to 3.9Moz and
the BC Mineral Resource unchanged at 331Koz.2
In February 2023, PDI announced an updated
NEB estimate, which was focused on partially
upgrading 1.75Moz of the Mineral Resource
from Inferred to Indicated, representing 50%
of the NEB Open Mineral Resource.3
The August 2023 update increased the total Mineral
Resource for the Bankan Gold Project by nearly 30%
to 100Mt @ 1.66g/t for 5.38Moz of gold, comprising
4.89Moz at NEB and 487Koz at BC.4 Beyond the
significant increase in the resource base, 4.14Moz or 77%
of the contained gold has been upgraded to Indicated,
providing a sufficient basis for the Scoping Study that
remains on track for completion by the end of 2023.
2 ASX announcement – 4.2Moz Bankan Gold Resource (2 August 2022).
3 ASX announcement – 50% of NEB’s 3.5Moz Open Pit Resource Upgraded to Indicated (6 February 2023).
4 ASX announcement – Bankan Mineral Resource Increases to 5.38Moz (7 August 2023).
Annual Report 2023
11
Figure 1: Change in Bankan Project Mineral Resource over time
NEB Open Pit (Indicated)
NEB Open Pit (Inferred)
NEB Underground (Inferred)
BC (Indicated)
BC (Inferred)
)
z
o
M
(
e
c
r
u
o
s
e
r
l
a
r
e
n
M
i
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0
5.38
0.24
0.24
0.90
0.09
4.22
0.33
0.04
4.18
0.33
0.34
1.77
3.84
3.90
1.75
3.65
0.33
3.32
Sept 2021
Aug 2022
Feb 2023
Aug 2023
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
12
Predictive Discovery Limited
Managing Director’s Report
and Review of Activities
Increased understanding of NEB and BC deposits
NEB is an extraordinary deposit that is characterised
by long runs of consistent mineralisation and a
high-grade core. It has a current Mineral Resource
estimate of 88.3Mt @ 1.72g/t for 4.89Moz of gold with
the potential for a large-scale open pit combined
with a high-grade underground operation.
A 10m x 10m RC grade control program was completed
in late 2022 across a section of the deposit, which
was designed to investigate the short range variability
of mineralisation and determine the required drill
spacing to achieve an Indicated Mineral Resource
classification. PDI’s independent resource modelling
consultant, CSA Global, assessed the results and
recommended that an 80m x 40m drill spacing is
sufficient to achieve an Indicated Mineral Resource.
Drilling within NEB’s resource pit shell was then
progressively infilled to the recommended spacing. The
February 2023 estimate achieved an upgrade of 50%
of the NEB Open Pit Mineral Resource to Indicated,
and in the August 2023 estimate, approximately
98% of the 3.99Moz NEB Open Pit Mineral Resource
was classified as Indicated. Of significance, the
Open Pit Mineral Resource includes a high-grade
core of 1.90Moz @ 5.21g/t commencing from just
over 100 metres below the surface, highlighting the
robustness of the high-grade mineralisation at NEB.
mineralisation is an extension of the high-grade core
within the resource pit shell, and additional underground
mineralisation is contained within the footwall. NEB’s
Underground Mineral Resource remains open at depth
below the deepest hole drilled to date, BNERD0013,
which intersected 24m @ 5.50g/t from 850m including
11m @ 10.3g/t from 852m.5 The current Underground
Mineral Resource has been established to allow a
Scoping Study level of assessment of an underground
operation, with the ultimate size of the underground
resource constrained by drilling at this stage.
BC is a satellite deposit located approximately 3km
west of NEB. During FY23, PDI completed a re-logging
and re-interpretation campaign, which resulted
in a substantially increased understanding of the
deposit’s geology and controls on the mineralisation.
This allowed better targeting of resource definition
drilling completed during the year and facilitated an
increase and upgrade of the BC Mineral Resource as
announced in August 2023. Overall, the BC Mineral
Resource increased to 12.2Mt @ 1.24g/t for 487Koz of
gold. This represents an increase in contained gold of
approximately 47% compared to the maiden BC Mineral
Resource estimate announced in September 2021 and,
importantly, includes 244Koz or 50% of contained gold
in the Indicated category. BC also includes a high-grade
zone commencing at a surface of 329Koz @ ~2.2g/t,
providing optionality for early higher-grade ore feed.
Significant additional drilling beneath the resource
pit shell was also completed during FY23, which
has established a high-grade Underground Mineral
Resource of 6.8Mt @ 4.07g/t for 896Koz of gold, which
is currently classified as Inferred. The main underground
The BC deposit remains open down-plunge to the
southwest and along strike to the south. Recent drilling
results have confirmed the presence of mineralisation
outside of the current resource envelopes and
either within or just below the resource pit shell.
Figure 2: NEB Mineral Resource by classification and by domain
Figure 3: BC Mineral Resource by classification and by domain
5 ASX announcement – Deepest Hole to Date Intercepts Gold 630m Down Dip (15 June 2022).
Annual Report 2023
13
Regional exploration
The Bankan permits are favourably situated on
the western margin of the Siguiri Basin, a major
structural trend that has the potential to host large-
scale gold deposits, and it is no surprise that the
NEB deposit sits adjacent to this structure. PDI has
35km of this major structure within the Bankan
permits and there is excellent potential to discover
additional gold deposits along this trend.
With the NEB and BC deposits progressing on the
pathway towards studies and permitting, we have been
actively increasing our focus on regional exploration.
The regional exploration programs are being managed
by a head regional geologist we appointed during
the financial year, who has support from a dedicated
exploration team. This provides the required focus to
progress regional exploration systematically and rapidly.
Previous early-stage exploration identified multiple
target areas across the Bankan permits. Argo is the
highest priority area of interest and is the current
focus of our regional exploration programs. Argo is
located between 15 to 20km north of the NEB deposit,
outside Buffer Zone 2 of the National Park, and in a
similar structural and geological setting to NEB.
Extensive auger geochemical drilling and geophysics
surveys were carried out at Argo during FY23, which
resulted in the identification of 11 drill targets. An initial RC
drilling program comprising approximately 50 holes for
7,000m commenced in June 2023, which is conducting
first-pass drill testing of the majority of these targets.
During August 2023, we were pleased to report very
encouraging results from the first 23 holes, with a number
of excellent intercepts reported at multiple targets. The
best results included 12m @ 6.75g/t at Fouwagbe, 5m
@ 5.16g/t at Sounsoun and 14m @ 1.97g/t at Tindini.6
The remaining holes of the initial drill program are
selectively following up on the most promising results
received so far, and testing additional high-priority
targets in the southern parts of Argo. We are also
actively planning for the next phase of drilling, which
is likely to include aircore and additional RC drilling,
and potentially some initial diamond drilling.
While this phase of our regional exploration is
only just starting to gather steam, we believe the
results so far highlight the potential of the Argo
region and the Bankan permits more broadly.
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
Figure 4: Bankan Project regional targets, major structural trend (pink
line) and the Argo area (red box)
Figure 5: Initial Argo RC drilling results
6 ASX Announcement – Encouraging Initial Argo RC Results (29 August 2023).
14
Predictive Discovery Limited
Managing Director’s Report
and Review of Activities
Near-resource exploration
Similarly, we have also increased our exploration of
the many targets that have been identified in close
proximity to the NEB and BC deposits. These targets were
identified by previous multi-element auger geochemistry
drilling and geophysics surveys, and the follow-up
aircore drilling produced some outstanding intercepts.
Financial
At the end of FY23, PDI held $44.9m in cash and is
well-funded to continue advancing the Bankan Project.
PDI completed a placement in June 2023, raising
approximately $40.4m (before costs) at an issue price
of $0.15 per share.
RC drilling at these targets commenced in the latter
part of FY23, with the aim of the program to discover
additional deposits that can contribute to a future
operation centred around the critical mass of NEB
and BC.
We have reported some encouraging initial results,
and 800W in particular is showing potential to host
shallow mineralisation only 400m north-west of the
current NEB resource pit shell. A selection of the best
RC drill intercepts received from 800W include 14m
@ 2.79g/t from 5m, 16m @ 1.74g/t from 41m, 11m @
2.42g/t from 42m and 9.5m @ 2.73g/t from 21m.7,8
We are completing additional drilling at 800W to
test for potential strike extensions to the north
and south, and drilling is underway and planned
at multiple other target areas. We look forward
to regular news flow from this drilling in FY24.
Safety
We have a zero-harm objective, and the Company reports
safety performance, both employees’ and contractors’, on
a quarterly basis. During the period, the Company had a
total recordable injury frequency rate of 0.51 per million
man hours. This comprised 30 incidents, with 9 requiring
first aid treatment. No lost time injuries were recorded.
Figure 6: Near-resource drilling results
Funds raised from the placement will be used as follows:
l Ongoing resource definition drilling to further expand
and upgrade the Mineral Resource at the Bankan
Gold Project;
l Acceleration of regional exploration drilling at multiple
high priority targets along Bankan’s 35km structural gold
corridor, commencing at the Argo prospects located
along strike to the north of the NEB deposit;
l Completion of the ESIA and Scoping Study; and
l Expenses of the Placement, corporate costs and
general working capital.
Importantly, approximately $20m from the placement
has been allocated to regional drilling in a results-driven
manner, as we strive to develop the Bankan Project into
a multi-deposit gold camp.
The placement was strongly supported by our existing
major shareholders, and we welcomed many new high-
quality investors to our share register, with new investors
accounting for nearly 50% of the funds raised. We are
building a deep shareholder base which can support
PDI through Bankan’s development phase.
7 ASX Announcement – Encouraging Drill Results and NEB, BC and Nearby Targets (19 June 2023).
8 ASX Announcement – Further Strong Drilling Results from the NEB & BC Area (12 September 2023).
Annual Report 2023
15
Sustainability
Sustainability is a key focus for PDI, and we are
dedicating significant effort and resources towards this.
Central to our work on sustainability is the ESIA, which we
commenced during FY23 and is on track for completion
by the end of 2023. The ESIA will be developed to meet
investment-grade international standards, including the
IFC’s Performance Standards and the Equator Principles.
The ESIA is a key input into the Bankan Project’s
Scoping Study, which is scheduled for completion in
late 2023. Critical Resource, an ERM Group company,
is leading and compiling the ESIA with support from
Biotope and Guinee Ecologie on the environmental
workstreams, and Insuco on the social workstreams.
This ESIA process requires regular engagement and
ongoing participation with key stakeholders including the
Ministry of Environment and Sustainable Development
and the Ministry of Mines and Geology at national,
regional and local levels. These engagements reinforce
PDI’s commitment to ensuring that environmental and
social impacts are carefully assessed, and the interests
of local communities and the local environment are
considered at every step of the Project’s development.
During the year, a number of key surveys and studies
were completed for the ESIA, including wet and
dry season ecological surveys, socio-economic
surveys, a cultural heritage and archaeological study,
bushmeat and ecosystem services study, and an
artisanal and small-scale gold mining study.
Figure 7: The roadmap to permitting
Taking a diligent and disciplined pathway to development
Part of the Bankan Gold Project is located in Buffer Zone
2 of the Upper Niger National Park, and we have extended
the area of influence of the ESIA to provide additional
valuable information to the Government and Park
officials. We have also invited representatives from the
Ministry of Environment and Sustainable Development
to attend our ecological surveys. We firmly believe that
the presence of the Bankan Project can have a positive
impact on the conservation efforts of the Park.
More broadly, we are actively engaged with the
Government of Guinea and meet with key ministers
on a regular basis. I thank the Government for their
open dialogue and for their support of the Bankan
Project, which has the potential to be a significant
contributor to Guinea through Government revenues,
jobs and local development in the Kouroussa region.
We are fostering strong relationships with the
local government and local communities, and we
have tremendous support for the Bankan Project.
We are proud to already have many local people
as employees or contractors and look forward to
additional opportunities as the Project advances.
Further information on our sustainability performance
can be found in the inaugural Sustainability Review,
which we are pleased to present on pages 20 - 25.
2023
ENVIRONMENTAL SOCIAL IMPACT ASSESSMENT
(ESIA)
Comprehensive study and report of a project’s potential environmental and social risks and impacts
ESIA findings will inform the Environmental and Social Management Plan (“ESMP”), essential
to obtaining the necessary permits and permissions from the Government of Guinea
2024
ESIA
SUBMISSION
TO
GOVERNMENT
OF GUINEA
SCHEDULED
LATE 2023
2021
PROJECT
DEFINITION
Identified key
stakeholders
Established
clear lines of
communication
Established a
commitments
register
2022
RAPID
ECOLOGICAL
ASSESSMENT
(REA)
Rapid
assessment
and analysis
of the
environmental
context
of Bankan
Project
Key activities to date
Key activities to come
ES scoping report submitted to MEDD – AGEE
Development of ESIA report by consultants
First social baseline surveys completed
PDI review and internal ESIA approval process
Wet season ecological surveys completed
Development of ESMP
Environmental baseline monitoring commenced
Ecosystems services & bushmeat field studies
conducted
Archaeology field study conducted
ES scoping report and ESIA terms of reference
validated by GoG-Technical Environmental
Advisory Committee
Dry season surveys
Installation and commencement of in-situ water
and air quality monitoring equipment
Second social baseline surveys, including
standalone study on artisanal mining
Final socio-economic surveys
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
16
Predictive Discovery Limited
Managing Director’s Report
and Review of Activities
In conclusion
FY23 was a year of excellent progress across PDI’s key
workstreams, and this wouldn’t have been possible
without strong support from all of our stakeholders.
Firstly, I’d like to thank the Government of Guinea,
the Kouroussa Prefecture and the local communities
for their open dialogue and support for the Company
and Project. We are a Guinea-focused company
and I believe the development of the Bankan
Project can create significant long-term benefits
for both the country and the local region.
I would also like to express my gratitude to PDI’s
Board of Directors – Simon, Sandra and Steven
– your guidance throughout the year has been
critical to our development as a company. Of equal
importance are our employees – the success and
progress we made during the year was made possible
through your tireless commitment and efforts.
Finally, thank you to our existing and new shareholders,
for your support in funding the Company during the
year as we progress with our plans to achieve what
I believe will be major upcoming value catalysts.
FY24 will be the defining year for your company, building
upon the critical milestones delivered in FY23. We
are working hard on finalising the ESIA and Scoping
Study by the end of 2023 and securing the Exploitation
Permit for the Bankan Project in the first half of 2024.
These will undoubtedly be landmark milestones for
the Company. As we continue to meet our ongoing
milestones, combined with the potential upside from
the steady flow of results as we seek another new major
discovery, I, your Board and all at PDI will work tirelessly to
delivering on our game-changing objectives during FY24.
Yours sincerely
Andrew Pardey
Managing Director
Annual Report 2023
17
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
18
Predictive Discovery Limited
Mineral Resources and
Ore Reserves Statement
PDI reviews and reports its Mineral Resources for
the Bankan Gold Project at least annually at times
which align with the strategic objectives of the
Company. The maiden Mineral Resource estimate
for the Bankan Gold Project was announced in
September 2021, with updates announced in August
2022, February 2023 and August 2023. PDI has
not yet reported Ore Reserves for the Project.
The Mineral Resource estimate presented in
this year’s annual statement is the August 2023
estimate (Figure 8), which is compared to the August
2022 Mineral Resource estimate (Figure 9).
The total Bankan Project Mineral Resource increased
to 100.5Mt @ 1.66g/t for 5.38Moz of gold, comprising
4.89Moz at NEB and 487Koz at BC. This represents
a total increase of contained gold of approximately
1.2Moz compared to the August 2022 estimate.
The NEB Open Pit Mineral Resource marginally
increased to 3.99Moz, whereas the NEB Underground
Mineral Resource increased to 896Koz from the
initial Underground Mineral Resource of 44Koz in the
August 2022 estimate (which was a subset of the total
August 2022 NEB Mineral Resource of 3.88Moz).
Based on the amount of drilling completed, 4.14Moz
of the Mineral Resource is classified comprising
3.90Moz of the NEB Open Pit Mineral Resource and
244Koz of the BC Mineral Resource. The August 2022
Mineral Resource was entirely classified as Inferred.
Mineral Resources and Ore Reserves governance
The Bankan Project Mineral Resource estimates are
completed by an external consultant who qualifies
as a Competent Person as defined by the 2012
Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore
Reserves. Suitably qualified members of the PDI
Board and management team provide input where
required and review the estimates prior to release.
Competent Person statement
The Mineral Resource estimates reported herein are
based on information compiled by Mr Phil Jankowski,
who is a Fellow of The Australasian Institute of Mining
and Metallurgy. Mr Jankowski is a full-time employee
of CSA Global Pty Ltd and has sufficient experience
relevant to the style of mineralisation and type of
deposits being considered to qualify as a Competent
Person as defined by the 2012 Edition of the Australasian
Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves. Mr Jankowski consents to
the inclusion in the report of the matters based on his
information in the form and context in which it appears.
The Mineral Resource and Ore Reserves Statement in
this report has been approved by Mr Phil Jankowski,
who is a Fellow of The Australasian Institute of Mining
and Metallurgy and a full-time employee of CSA Global
Pty Ltd. Mr Jankowski consents to the inclusion in
the report of the matters based on his information
in the form and context in which it appears.
The information in this report that relates to prior
Exploration Results have been referenced to the original
announcement date. The Company confirms that it is
not aware of any new information or data that materially
affects previous exploration results referred to in this
announcement. The Company also confirms that the
form and context in which the Competent Person’s
findings are presented have not been materially modified
from the relevant original market announcements.
Figure 8: August 2023 Mineral Resource estimate
Deposit
NEB Open Pit
NEB Underground
NEB Total
BC Open Pit
BC Total
Total Bankan Project
Classification
Indicated
Inferred
Total
Inferred
Indicated
Inferred
Refer to ASX announcement – Bankan Mineral Resource Increases to 5.38Moz (7 August 2023).
Figure 9: August 2022 Mineral Resource estimate
Deposit
NEB Total
BC Total
Total Bankan Project
Classification
Inferred
Inferred
Refer to ASX announcement – 4.2Moz Bankan Gold Resource (2 August 2022).
Below: Preparing samples from diamond drilling at the Bankan Project core shed
Annual Report 2023
19
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
Cut-off
(g/t Au)
Tonnes
(Mt)
Grade
(g/t Au)
Contained
(Koz Au)
0.5
0.5
2.0
0.4
0.4
78.4
3.1
81.4
6.8
88.3
5.3
6.9
12.2
100.5
1.55
0.91
1.53
4.07
1.72
1.42
1.09
1.24
1.66
3,900
92
3,993
896
4,888
244
243
487
5,376
Cut-off
(g/t Au)
Tonnes
(Mt)
Grade
(g/t Au)
Contained
(Koz Au)
0.5
0.5
72.3
7.2
79.5
1.65
1.43
1.63
3,884
331
4,215
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
20
Predictive Discovery Limited
Sustainability Review
PDI’s purpose is to enable the
development of Guinea’s gold deposits
and deliver long-term value to its
stakeholders. This purpose directs the
Company’s decisions and actions and
shapes its culture and strategy.
Through the responsible development of the Bankan
Gold Project into a Tier-1 mine and the identification
and development of other deposits, PDI will
deliver value for its shareholders, employees, local
communities, and the Government of Guinea.
PDI has taken a materiality-led approach to identify
and manage the sustainability matters of most
prominence to the Bankan Project and establish
the right stakeholder engagement channels.
PDI’s project landscape
Guinea is a country that is rich in natural resources and
is rapidly emerging as a major gold region. With a mature
resources industry and a history of mining excellence,
Guinea is becoming increasingly attractive to global
investors seeking stable and lucrative opportunities.
Guinea’s status as a recognised mining jurisdiction is
underscored by its low security risk, uninterrupted
mining operations, and vast, underexplored geological
potential. Mining plays a pivotal role in the nation’s
economy, with Guinea ranking as the world’s
third-largest bauxite producer and exporter.
Open communication between Guinea’s mining sector
and its Ministry of Environment and Sustainable
Development fosters responsible resource development
and ensures that the industry operates in harmony
with the environment and local communities.
PDI is committed to responsible operating practices as
it seeks to contribute to socio-economic development
through gold mining in Guinea. The Bankan Project
represents a significant milestone in PDI’s efforts
to harness the potential of this mineral-rich land.
Located in the northeast of Guinea, near the city
of Kouroussa, the Bankan Project occupies a key
position in the Siguiri Basin. This region annually
produces over 500,000 ounces of gold, making it
a significant player in the world of gold mining.
PDI’s commitment to responsible mining extends
beyond merely extracting resources. The NEB and BC
deposits lie within Buffer Zone 2 of the Upper Niger
National Park, an ecologically sensitive classified area.
The Company is actively engaging with the National
Park authorities and the Ministry of Environment and
Sustainable Development while thoroughly assessing
and documenting the biological environment in
the project area in line with its ESIA process. This
will facilitate the development of corresponding
environmental and social management plans (ESMPs).
Below: Good quality wooded savannah in the park
Below: Degraded landscape in Buffer Zone 2 near the NEB deposit
Annual Report 2023
21
Sustainability Governance
PDI is exploring and planning the development of the
Bankan Project in line with the Responsible Gold Mining
Principles (‘RGMPs’) of the World Gold Council which
underpins the responsible development of projects
that generate value for the full range of stakeholders
impacted by and involved with a project.
PDI is committed to conducting business ethically and in
a way that is open and accountable to its stakeholders.
The Board of Directors is responsible for overseeing
strategy and performance and protecting the rights and
interests of stakeholders. High standards of corporate
governance are considered essential to give effect to
these responsibilities and are embraced by the directors.
In 2023, the Company established an ESG
Committee that provides board-level oversight of
its sustainability strategy, ensuring alignment with
its corporate goals, and maintaining transparency
and accountability throughout its operations. The
ESG Committee has oversight responsibility for all
HSE, community and sustainability-related matters
related to the ESIA and project design, which include
climate change and biodiversity considerations.
The Managing Director has strategic ownership for all
matters relating to sustainability. Day to day responsibility
for management sits with the ESG Manager who is the
principal lead on all health, safety and environmental
matters associated with the Company’s exploration
activities as well as the ESIA process. At the management
level, the Company’s Country Manager also carries
significant responsibility regarding all national, local and
community-related stakeholder engagement. Together,
they are responsible for implementing PDI’s short-
and medium-term sustainability-related initiatives.
In support of management, the Company recently
appointed dedicated environmental and social
superintendents to lead key workstreams, including
overseeing key assessments as part of the ESIA
process and stakeholder engagement program.
These appointments bring specialised expertise
and experience to the team, strengthening the
Company’s ability to navigate complex ESG challenges
and engage effectively with stakeholders.
The Company also enlists support from key consultants.
Critical Resource, an ERM Group company, is leading
and compiling the ESIA with Biotope and Guinee
Ecologie supporting the environmental workstreams,
and Insuco supporting the social workstreams.
Our sustainability objectives are are
integral to PDI’s operational functions
and corporate actions. Determining our
environmental and social impacts and
designing a management plan that reflects the
environmental, ecological and socio-economic
sensitivities of developing a mining project
partially overlapping the Upper Niger
National Park is critically important.
To that end, and over the past 12 months, the
ESG Committee has actively participated in
the ESIA process, along with engagements
with key stakeholder groups responsible for
contributing to this process, ensuring process
oversight, business alignment and support for
our management team. These collective efforts
are crucial as we drive the business from
exploration into into development in
line with our rigorous timetable.
Sandra Bates,
Non-executive Director & Chair of the ESG Committee
Impacts, risks and opportunities
A commitment to robust governance is a cornerstone
of the Company’s approach and ability to deliver
its corporate objectives. A deep appreciation for
PDI’s impacts, risks and opportunities at the Bankan
Project is being captured within the ESIA. This will
inform development and operational management
plans with findings from the ESIA process also
informing improvements to existing engagement
and risk management plans as appropriate.
Through continuous monitoring and assessment,
PDI strives to mitigate potential adverse impacts
while maximising the benefits of its operations.
PDI takes risk management very seriously; it is embedded
into the culture of the organisation. Control over risks
is critical to the success of PDI as it moves through
the exploration and development phase where risk
management is integral to its sustainability program.
PDI has a defined risk management framework and risks
are captured in the Company’s risk register spanning
financing, strategic, employee-related, community-related,
human rights, artisanal and small-scale gold mining
(ASGM), climate and environment including biodiversity.
In March 2023, the Company’s risk register was
reviewed and updated in line with its continual
review process with actions currently underway
to develop the Company’s risk framework.
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
22
Predictive Discovery Limited
Sustainability Review
Stakeholder engagement
Engagement with stakeholders is essential to better
understanding their interests and concerns. The Company
takes a proactive approach and aims to have clear and
transparent engagement with all our stakeholders to
ensure the continued understanding of our business.
Ethical conduct
The Company is committed to maintaining high
ethical standards when conducting its activities. The
Company’s reputation as an ethical organisation is
important to its ongoing success and it expects all
its officers and employees to be aligned and have a
personal commitment to meeting these standards.
In December 2022, the Company published its Code of
Conduct outlining the principles giving direction to and
reflecting the Company’s approach to business conduct.
The Board and senior executives approved and endorsed
this Code of Conduct and encourages all staff to consider
the principles and use them as a guide to determine
how to respond when acting on behalf of the Company.
As stated in the Company’s Anti-Bribery and
Anti-Corruption Policy, PDI has a zero-tolerance
stance in relation to bribery and corruption. The
Company is pleased to report that there were
no formal issues or matters relating to bribery or
corruption raised during the reporting period.
Human rights
In accordance with the UN’s Guiding Principles for
Business and Human Rights, PDI will conduct due
diligence to identify human rights, corruption and
conflict risks associated with its activities and its
supply chain with the intention of preventing adverse
impacts. Following this, PDI will monitor performance,
periodically checking its assessment of the risks is
up-to-date. The Company is developing its processes
and systems from the ground up and developing
governance processes and systems to ensure
this is embedded throughout the organisation.
PDI’s stakeholder profile encompasses a diverse
range of actors, including national, regional, and local
authorities, as well as communities both within and
outside the immediate sphere of its social influence.
The Company currently adopts an issue-based and
proactive approach when engaging with regional and
local authorities. This entails sharing detailed project
information, fulfilling all regulatory requirements,
and seeking the necessary authorisations to operate
responsibly and within the bounds of the law.
In 2023, the Government of Guinea endorsed PDI’s
environmental and social scoping report and terms
of reference for the ESIA, providing governmental
endorsement for upcoming workstreams.
In line with the ESIA process, the Company is developing
a robust and fulsome stakeholder engagement plan,
which will consist of specific profiling of a broad range
of stakeholders, including communities. This will be
critical as the Company enters the next phase of
development when greater engagement is fundamental.
Resolving grievances
As part of a proactive approach to community
engagement, it is essential to have a grievance system in
place. This enables a systematic and objective process
for evaluating and responding to matters raised. The
mechanisms currently in place are appropriate for a
business of PDI’s stature. As the Company moves beyond
the exploration phase and into development, these
systems will become more sophisticated and structured
in line with the operational footprint in the community.
For the period July 2022 to June 2023, the company
received 17 grievances, including 10 relating to
employment, all of which were resolved.
Below: Meeting with community stakeholders
Below: Community welcome ceremony
Community engagement
PDI is committed to engaging with its communities
in a transparent and meaningful way. The Company
is developing its social programs in partnership
with communities, local authorities and third-
party experts, to reflect and respond to community
requirements as it develops the Bankan Project.
For the Bankan Project to be
a success, knowing who our
stakeholders are, what they require and
how we need to collectively work together
is essential. We have spent a significant
amount of time this year mapping the
project’s spheres of influence to establish
clear channels of communication and
build the right relationships.
Having spent many years operating in and
around the mining sector within Guinea –
from time with the Ministry of Mines and
Geology to working for in-country mining
operators – I believe I bring a valuable
perspective that will enable PDI and
our host communities to collectively
benefit from the Bankan Project
and ensure its success.
Marlyatou Baldé, Country Manager
Community consultation is paramount in achieving
PDI’s operational and social objectives. In 2022, the
Company established a Community Consultative
Committee representing nine villages, which serves as
a key platform for ongoing dialogue and collaboration.
Through these regular meetings, the Company not
only keeps the community well-informed about its
activities but actively involves them in decision-making
processes, thus fostering a sense of ownership and
partnership in the development of the project.
Below: Community welcome ceremony
Annual Report 2023
23
Initial committee meetings have commenced and
upon submission of the Company’s ESIA, further
consultative structures will be established at the
local level. The committee is also responsible
for implementing a grievance mechanism.
To date, community benefits have been seen largely in
employment and local procurement, however, several
community projects were progressed during the year.
A key achievement for PDI was establishing a canteen
within the local school, as well as rehabilitating the
school, thereby transforming it into an appealing
learning environment for local children. In addition,
the Company hired a contract worker to assist the
existing teacher who was previously responsible for
six classes. Having identified a clear lack of education
provision and the need for expanded educational
support, the Company approached the Minister
of Education and successfully advocated for the
recruitment of two additional teachers. This aims
not only to build capacity for local content within the
communities but also to discourage child labour.
The Company’s commitment to improving education
and opportunities for the local population extends
to addressing unemployment among local youth. In
response to the lack of local employment prospects
for youth, the Company supported efforts to establish
a government-sponsored professional school. This
institution is designed to provide training in practical
skills including truck driving, welding and basic technical
skills which are in high demand in the mining industry.
The Company’s proactive approach in advocating
for the establishment of this school aligns with the
broader industry-wide need for skilled labour.
Engaging with ASGM
PDI recognises that ASGM is a reality in Guinea,
particularly in the region. Over the years, the Bankan area
has been locally deforested, altering the biodiversity of
the area, water courses and habitats. The area affected
by ASGM has not been quantified. PDI liaises with the
Government of Guinea to enable legitimate practices.
In addition, the Company works in collaboration with
multiple stakeholders to ensure that the safety of
employees, the community and the environment
are central to engagement and action plans.
As part of the ESIA and corresponding ESMPs, the
Company will develop an ASGM management framework
to international standards as the project advances from
exploration to exploitation on successful permitting to
ensure that it can apply leading international practice
to managing ASGM within its exploitation permits. The
framework will seek to balance the protection of the
Company’s assets as far as reasonably possible with
the maintenance and development of good relations
with local people and authorities, protecting artisanal
miners in the permits from the health and safety risks
inherent in their work and supporting the Government in
applying the Guinean Mining Code’s provisions on ASGM.
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
24
Predictive Discovery Limited
Sustainability Review
PDI’s people
As of June 2023, PDI had 215 employees.
Figure 10: Employees by gender
Gender
Male
Female
Total staff
Perman-
ent
Fixed
Term
Contract
Short
Term
Contract
Daily
Labour
& Service
Agreement Total
13
2
22
6
123
14
30
5
188
27
215
PDI maintains a relatively small permanent staff,
with the vast majority of employees on fixed term
contracts – which includes our expatriate personnel
located in Guinea – to meet with the fluctuations
in project and exploration activity. As of June 2023,
93.9% of PDI employees were Guinean and 100% of
daily employees and subcontractors were Guinean.
Figure 11: Employees by nationality
Guinean Nationals
Expatriates in Guinea
Other Employees
Total
PDI employees
(permanent
and temporary)
Number
Percentage
202
93.9
8
5
3.7
2.3
215
100.0
Health & safety
Providing a safe working environment and maintaining
people’s health, safety and well-being are of paramount
importance to PDI. The Company is committed
to providing a safe, secure and rewarding work
environment, and to maintaining exceptional health
and safety performance wherever it operates.
PDI has a zero-harm objective, and the Company reports
safety performance, both employees’ and contractors’, on
a quarterly basis. During the period, the Company had a
total recordable injury frequency rate of 0.51 per million-
man hours. This comprised 30 incidents, with 9 requiring
first aid treatment. No lost time injuries were recorded.
The Company has a proactive approach to health
& safety, which includes safety toolbox meetings
and regular training sessions covering areas such as
incident and accident reporting, fire safety, first aid, and
driving safety. Together, across various departments
including superintendents, officers, and geologists,
PDI prioritises safety as a collective responsibility.
Human resources and labour rights
Respecting colleagues and the partners that work
with PDI is a fundamental part of the Company’s
commitment to protecting employees, contractors and
local communities. In 2023, PDI brought the human
resources function in-house, utilising external specialists
for training and advice for highly skilled roles as required.
As stated in its Human Resource Policy, PDI respects
and follows recognised international human and
labour rights and has a zero-tolerance stance on
modern slavery. To that end, the Company supports
the right to safe working conditions, equal treatment
and fair reward, and implements mechanisms to
maintain effective relationships with employees,
communities and other stakeholders. The Company
prohibits child labour, forced labour and modern
slavery in its operations and in its supply chains.
As stated in its Diversity Policy, PDI is committed
to workplace diversity and recognises the benefits
arising from diversity in its employees and on its board
including a broad pool of high-quality employees,
strong employee retention and access to different
perspectives and ideas, which together allow PDI to
benefit from all available talent. Diversity includes, but
is not limited to, gender, age, ethnicity and cultural
background. To the extent practicable, PDI will address
the recommendations and guidance provided in the ASX
Corporate Governance Council’s Corporate Governance
Principles and Recommendations (ASX Principles).
As of June 2023, 87.73% of employees were male.
Environmental stewardship
Environmental management and protection is critical for
PDI. The Company recognises that mining has an impact
on the environment, and it is committed to prevent,
minimise, and mitigate negative environmental impacts
where it operates. At present, during exploration, the
Company has a relatively low impact but appreciates that
this will evolve over time as the Company progresses
through the Project’s development phases. The Company
is committed to adopting and implementing policies
and practices to avoid or mitigate impacts on the local
communities and the environment arising from noise,
dust, blasting and vibrations, among other impacts.
During the period, PDI was granted the annual
renewal of the environmental authorisation for the
Bankan Project from the Minister for Environment and
Sustainable Development. The Company works closely
with the relevant governmental agencies to ensure
operations comply with national regulations, and the
successful renewal of the environmental authorisation
is a testament to the Company’s commitment to
environmental stewardship and social responsibility.
Annual Report 2023
25
PDI has embarked on a definitive
ESG path underscored by good
international industry practice and
regulatory compliance to ensure a
sustainable project that integrates broad-
based stakeholder interests. The Bankan
Project will exemplify this philosophy
in all aspects of project development,
execution and closure.
Andre Pieters, ESG Manager
Environmental studies, surveys and baseline
assessments have been completed across PDI’s
permits, and into the corridor of the Niger River
to establish a representative biodiversity baseline
in the Bankan Gold Project’s region and areas of
environmental importance beyond. Further environmental
studies are underway to meet IFC’s Performance
Standards such as dust and noise monitoring.
Biodiversity
PDI recognises the significance of biodiversity and the
Project’s location in Buffer Zone 2 of the Upper Niger
National Park. The Company is actively engaged in a
systematic assessment of the local environment to
develop suitable plans to improve the Park’s overall
management, particularly in its core area and inner
buffer zone. PDI is actively developing a robust legal
and technical justification for its presence in the
Park’s outer buffer zone which will involve improving
conservation of more central parts of the Park.
PDI’s approach includes the implementation of the
mitigation hierarchy, aiming for no net loss or ideally a
net gain of natural habitat. A critical habitat assessment
is part of the Company’s ESIA and strategy to achieve net
gain of critical habitat. PDI is committed to responsible
natural resources management and protection of
ecosystem services, acknowledging the resources
situated within local communities’ land and their
dependence on such resources, and will implement
strategies to effectively manage these resources.
Below: Wildlife monitoring camera near the Niger River
The Company’s baseline understanding of biodiversity
began with a rapid ecological assessment conducted
by ERM, Biotope and Guinee Ecology in July 2022
which investigated the habitats present locally and
identified priority species around the NEB and BC
deposits. These surveys covered a wide range of
aspects, including the sampling of habitats, assessment
of flora, monitoring of mammals, bats, birds,
reptiles, amphibians, freshwater fish, and freshwater
invertebrates. Further targeted studies, in particular
of chimpanzees, are ongoing in order to understand
seasonal movements and the use of habitat.
Land use
Land uses and natural resources management feature
extensively in PDI’s ESIA. Habitats and their ecological
integrity vary greatly within the Project’s area and include a
mix of natural and modified habitats. Much natural habitat
is significantly disturbed by pre-existing anthropogenic
activities including subsistence (slash-and-burn)
agriculture, grazing and related use of fire, and ASGM.
Water access and quality
At present, PDI has low water usage. However, it will
increase during mine development and thus, the
Company’s ESIA and ESMPs will define water usage
requirements and a stringent management plan for
how the Company utilises water in the future so it does
not impact communities’ needs or local ecosystems.
Water recycling will be included within the design.
Waste management and hazardous materials
Tailings and waste management assessments and
plans form a central component of PDI’s ESIA. Managing
cyanide and hazardous materials is essential to the
Bankan Project, therefore the Project’s design includes
a cyanide-destruction facility, and the Company will
strive to gain certification by the International Cyanide
Management Code. PDI also plans to utilise dry
stacked tailings, further reducing environmental risk.
Climate change
The Company is sensitive to the threats posed by
climate change. Climate change adaptation (CCA) and
risk assessments are key components of the ESIA
process which will ultimately deliver a CCA management
plan. In addition, in line with new requirements of
the Equator Principles IV, the Company is proactively
identifying and assessing the potential risks and impacts
of its operations in relation to carbon at all stages of
the project. PDI will seek to manage natural resources
efficiently, support land uses that enhance carbon storage
and investigate ways to reduce resource consumption
and the carbon footprint of its energy sources.
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
26
Predictive Discovery Limited
Financial
Statements
Annual Report 2023
27
Directors’ Report
Statement of Profit or Loss and
Other Comprehensive Income
Statement of Financial Position
Statement of Changes In Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Auditor’s Independence Declaration
28
44
45
46
47
48
75
76
81
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
28
Predictive Discovery Limited
DIRECTORS’ REPORT Predictive Discovery Limited (the “Company” or “PDI”) is a public company incorporated and domiciled in Australia and listed on the Australian Securities Exchange. The directors of the Company present their report on the Group, which comprises Predictive Discovery Limited and its controlled entities, for the year ended 30 June 2023. The names of the directors in office at any time during, or since the end of the year are: NAMES POSITION Mr Simon Jackson Non-Executive Chairman Mr Andrew Pardey Managing Director Mr Steven Michael Non-Executive Director Ms Sandra Bates Non-Executive Director The directors have been in office since the start of the financial year to the date of this report unless otherwise stated. COMPANY SECRETARY Mr Ian Hobson – B. Bus FCA ACIS MAICD Mr Hobson is a Fellow Chartered Accountant and Chartered Secretary with 15 years of experience as Company Secretary of ASX listed companies. Mr Hobson is also Company Secretary of VHM Ltd, Province Resources Ltd, Sarytogan Graphite Ltd, Novatti Group Ltd and VRX Silica Ltd. PRINCIPAL ACTIVITIES During the financial year, the principal activity of the Group was mineral exploration with the objective of identifying and developing economic reserves in West Africa. OPERATING RESULTS FOR THE PERIOD The consolidated loss of the Group for the financial year after providing for income tax amounted to $11,231,323 (2022: $9,687,702). This was largely from exploration costs, provision for indirect taxes in Guinea and the costs of administering the Group to 30 June 2023. DIVIDENDS PAID OR RECOMMENDED No dividends were paid or declared since the start of the financial year. No recommendation for payment of dividends has been made. FINANCIAL POSITION The net assets of the Group have increased by $54,763,507 from 30 June 2022 to 30 June 2023. This net movement is largely due to the following factors: §$44m net capital raising;§Expenditure on exploring and evaluating the assets in Guinea. Annual Report 2023
29
SIGNIFICANT CHANGES IN STATE OF AFFAIRS No significant changes in the Group’s state of affairs occurred during the financial year. EVENTS AFTER THE END OF REPORTING PERIOD The following events have occurred subsequent to the year ended 30 June 2023: (i)A General Meeting of shareholders was held on 27 July 2023 to (a) ratify the placement of 269.6m shares at anissue price of $0.15 per share (raising $40.4m before costs) completed in June 2023; and (b) approve the issueof up 1.0m shares to directors (and/or their nominees) at an issue price of $0.15 per share. All resolutions putthe meeting were carried following a poll;(ii)Additional resource definition drilling results for NEB and BC were announced on 7 August 2023;(iii)A Mineral Resource update was announced on 7 August 2023, increasing the overall Bankan Project MineralResource estimate to 5.38Moz (including 4.14Moz Indicated)1 and(iv)Encouraging results from the initial RC drilling program at Argo were announced on 29 August 2023.There has not been any other matter or circumstance arising after the balance date that has significantly affected or could significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years. FUTURE DEVELOPMENTS Likely developments in the operations of the Group and the expected results of those operations in future financial years have not been included in this report, as the inclusion of such information is likely to result in unreasonable prejudice to the Group. ENVIRONMENTAL ISSUES The Group’s operations are subject to significant environmental regulations under the Commonwealth and State legislation in Australia and under local legislative authorities in Guinea. The Board believes that the Group has adequate systems in place for the management of its environmental regulations and is not aware of a breach of those environmental requirements as they apply to the Group. 1 ASX announcement – Bankan Mineral Resource Increases to 5.38Moz (7 August 2023). OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 30
Predictive Discovery Limited
INFORMATION ON DIRECTORS Mr Andrew Pardey Managing Director Qualifications BSc Experience Mr Pardey is a geologist with more than 30 years’ experience covering exploration, project development, construction and operation. From 2015 to 2019, Mr Pardey served as the CEO of the $2 billion LSE/TSX-listed Centamin plc, which owns the major (450,000oz pa) Sukari Gold Mine in Egypt. Prior to being CEO of Centamin, Mr Pardey was a major driving force in bringing Sukari into production, having joined during the transition of the operation from construction into production. Earlier in his career, Mr Pardey also held senior management roles at the Anglogold-Ashanti Siguiri Mine and Nordgold Lefa Mine, both of which are located within Guinea’s Siguiri Basin, which also hosts PDI’s Bankan Project. Interest in Shares and Options (at the date of this report) Shareholding: 333,333Option holding: 15,000,000 Directorships held in other listed entities during the three years prior to the current year Marvel Gold Limited (Resigned November 2022) Wia Gold Limited (Appointed October 2020) Mr Simon Jackson Non-Executive Chairman Qualifications B Com FCA Experience Mr Jackson is a Chartered Accountant with over 25 years’ experience in the management of resource companies, particularly in Africa. Mr Jackson was a senior member of the management team of TSX listed Red Back Mining Inc., a company that financed, developed and operated two gold mines in West Africa culminating in a CAD$9.3 billion takeover by Kinross Gold Corp in 2010. He was then founding President & CEO and later Chairman of TSXV listed Orca Gold Inc, a company which discovered the Block 14 gold project in Sudan and was taken over by Perseus Mining. Mr Jackson is currently Non-executive Chairman of ASX/TSXV listed Sarama Resources Limited and ASX listed Leeuwin Metals Limited, and Non-executive Director of ASX/LSE listed Resolute Mining Limited. He has been a director of multiple ASX and TSX listed companies. Interest in Shares and Options (at the date of this report) Shareholding: 760,000 Option holding: 7,000,000 Directorships held in other listed entities during the three years prior to the current year Leeuwin Metals Limited (Appointed June 2022) Cygnus Gold Limited (Resigned May 2022) CZR Resources Limited (Resigned Sept 2021) Kopore Metals Limited (Resigned Nov 2021) Resolute Mining Limited (Appointed Oct 2021) Sarama Resources Limited (Appointed Mar 2011) Mr Steven Michael Non-Executive Director Qualifications B. Com, CA, MAICDExperience Mr Michael has over 25 years’ experience in the global resources sector specialising in corporate finance and equity capital markets. He is currently Managing Director at Red Hawk Mining Limited, an ASX listed iron ore development company, and is a Non-Executive Director of Wia Gold Limited, an ASX listed African gold exploration company. He has previously worked in the natural resources divisions of Macquarie Bank, Rothschild and Royal Bank of Canada, and was a Managing Director at FTI Consulting. Mr Michael was previously Executive Director of ASX listed Deep Yellow Limited, Managing Director of ASX listed Vimy Resources Limited and Managing Director of ASX-listed Arrow Minerals Limited. Mr Michael is a Member of the Institute of Chartered Accountants in Australia and is a member of the Australian Institute of Company Directors. Interest in Shares and Options (at the date of this report) Shareholding: 3,032,797 Option holding: 2,500,000 Directorships held in other listed entities during the three years prior to the current year Red Hawk Mining Limited (Appointed March 2023) Arrow Minerals Limited (Resigned February 2020) Wia Gold Limited (Appointed September 2020) Vimy Resources Limited (Resigned August 2022) Deep Yellow Limited (Resigned December 2022) Annual Report 2023
31
Ms Sandra Bates Non-Executive Director Qualifications BCom, LLB Admitted as a Solicitor of England and Wales and South Australia Experience Sandra Bates is an international lawyer and expert adviser with over 20 years’ experience guiding management teams and boards through complex, cross-border, corporate transactions. Throughout her professional career, Ms Bates has been a trusted adviser to a range of listed and private companies in the natural resources and energy sectors and has broad experience encompassing Africa, Australia, Europe and the Americas. In addition to her legal and commercial expertise, Ms Bates advises on Environmental, Social and Governance (ESG) engagement, corporate governance and risk management. Ms Bates is General Counsel for TSXV listed Elemental Altus Royalties Corp and Legal Director and ESG adviser to ion Ventures. She is also Non-Executive Director of ASX and LSE listed Adriatic Metals Plc where she is Chair of the audit committee. Interest in Shares and Options (at the date of this report) Shareholding: 166,667Option holding: 5,000,000 Directorships held in other listed entities during the three years prior to the current year Adriatic Metals Plc (Appointed Nov 2019) Pensana Plc (Resigned September 2021) MEETINGS OF DIRECTORS During the financial year, 15 meetings / circular resolutions of directors (including committees of directors) were held. Attendances by each director at meetings during the year were as follows: Directors' Meetings Circular Resolutions Director Number eligible to attend Number attended Number eligible to attend Number attended Mr Simon Jackson 3 3 12 12 Mr Steven Michael 3 3 12 12 Ms Sandra Bates 3 3 12 12 Mr Andrew Pardey 3 3 12 12 INDEMNIFYING OFFICERS OR AUDITORS The Group has paid premiums to insure directors against liabilities for costs and expenses incurred by them in defending legal proceedings arising from their conduct while acting in the capacity of director of the Group, other than conduct involving a wilful breach of duty in relation to the Group. The terms and conditions of the insurance are confidential and cannot be disclosed. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 32
Predictive Discovery Limited
OPTIONS At the date of this report, the unissued ordinary shares of PDI under option, including those options issued during the year and since 30 June 2023 to the date of this report are as follows: Grant Date Date of Expiry Exercise Price Number under Option 21 Dec 2020 21 Dec 2023 $0.1120 8,000,000 14 May 2021 26 May 2024 $0.0986 3,500,000 08 July 2021 28 Jul 2024 $0.1400 8,000,000 8 November 2021 05 Nov 2024 $0.2910 2,500,000 25 May 2022 03 Jan 2025 $0.3400 3,000,000 18 July 2022 30 June 2026 $0.3000 29,500,000 18 July 2022 18 July 2025 NIL 6,625,000 18 July 2022 18 July 2026 NIL 6,625,000 18 July 2022 18 July 2027 NIL 13,250,000 TOTAL 81,000,000 During the year ended 30 June 2023 29,595,741 ordinary shares of PDI were issued on the exercise of options granted at $0.0986 per share, 2,500,000 ordinary shares of PDI were issued on exercise of options granted at $0.011 and 74,531,461 ordinary shares of PDI were issued on the exercise of options granted at $0.018 per share. PROCEDINGS ON BEHALF OF THE COMPANY No person has applied for leave of Court to bring proceeding on behalf of the Group or intervene in any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those proceedings. The Group was not a party to any such proceeding during the year. NON-AUDIT SERVICES The Board of Directors is satisfied that the provision of non-audit services by the auditor during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. Details of the amounts paid to the auditor of the Group for audit and non-audit services provided during the year are set out at note 20. AUDITOR’S INDEPENDENCE DECLARATION The auditor’s independence declaration for the year ended 30 June 2023 has been received and can be found on page 81. Annual Report 2023
33
REMUNERATION REPORT (AUDITED) 1.LETTER FROM THE CHAIR OF THE NOMINATION AND REMUNERATION COMMITTEEDear Shareholder, On behalf of the Board, I am pleased to present the 2023 Remuneration Report. FY23 performance and remuneration outcomes Throughout the 2023 financial year, PDI made excellent progress with the Bankan Gold Project in line with our strategy of developing it into West Africa’s next Tier-1 gold mine. The key upcoming milestone for PDI is to secure a mining permit for Bankan, and a significant portion of Management’s efforts during the financial year were directed towards workstreams to achieve this. In ongoing engagement with the Government of Guinea, PDI has established a clear pathway and requirements for the permitting process, which includes the delivery of a Scoping Study and Environmental & Social Impact Assessment (ESIA) to the Government. Both the Scoping Study and ESIA were commenced during the financial year and are on track to be completed in late 2023. Defining a robust Mineral Resource is crucial for the Scoping Study, and extensive resource definition drilling was completed at the NEB and BC deposits during the financial year, with the aim of growing and improving the classification of the existing Mineral Resource. Pleasingly, in August 2023, the Company announced an updated Mineral Resource of 5.38Moz for the Bankan Project which includes 4.14Moz in the Indicated category. This is nearly a 30% increase compared to the 4.2Moz Mineral Resource announced a year earlier in August 2022 (which was entirely Inferred) and provides a solid platform for the Scoping Study. It was crucial to the Project that a significant portion of the Mineral Resource was converted to the Measured and/or Indicated category as only a limited amount of Inferred Mineral Resources can be included in the Scoping Study. PDI successfully ramped up regional exploration during the financial year, which represents another potentially significant value catalyst for the Company. Argo is the current focus area, where extensive early-stage exploration defined numerous drill targets. The RC drilling program which commenced in June 2023 is starting to return highly encouraging results and there is a lot more follow-up drilling to be completed at Argo. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 34
Predictive Discovery Limited
Response to ‘first strike’ at the 2022 AGM Following a ‘first strike’ against our Remuneration Report at the 2022 Annual General Meeting (AGM), the Board, in conjunction with our Nomination and Remuneration Committee (NRC), have carefully reviewed and discussed the feedback received from shareholders and proxy advisors. In this light, we have summarised the primary concerns raised by stakeholders regarding the FY22 Remuneration Report, and how the Board has responded: Concern Board’s response Use and high quantum of irregular option awards is considered to be misaligned with shareholders best interests. Considering the Company’s exploration and development phase, business maturity and strategic objectives, the Board considered that offering bespoke option awards tied to milestone measures was the most suitable approach to incentivise executives. PDI is continuing to evolve rapidly, and the Board in conjunction with the NRC is conducting a comprehensive review of current remuneration practices in light of stakeholder feedback received at the 2022 AGM and the understanding that governance and disclosure practices need to mature with the Company. This review includes exploring the possibility of implementing a more structured and regular incentive program in the future. This process will involve careful deliberation regarding the potential structure and appropriate performance criteria to align with the Company’s strategic goals. No incentive awards will be granted until this review is completed. Absence of individual incentive limits. Grants of options to non-executive directors in addition to director fees. PDI is currently in a crucial stage of exploration and development, presenting significant opportunities but also challenges in both the short and long-term. Recognising the importance of aligning the interests of non-executive directors with those of the Company and its shareholders, the Board decided to grant options. This approach allows PDI to attract and retain relevant experienced non-executive directors, while conserving cash reserves (particularly during a period when the Company is not generating revenue) and allow those non-executive directors to have some equity exposure as a component of their remuneration. The non-executive director options are subject to service-based vesting conditions only, ensuring that remuneration is not linked to performance and, therefore, protecting their independence. No options will be granted to non-executive directors until the remuneration review described above is completed. Lack of disclosure of key long-term incentive (LTI) plan terms. PDI has a bespoke LTI plan which was approved by shareholders on 14 May 2021, but understands there is scope to develop a more structured and regular LTI plan in the future. No LTI awards were granted to executives or non-executives during FY22. Therefore, no information on PDI’s LTI plan or awards were included in the FY22 Remuneration Report. Details of PDI’s LTI plan can be found in the Notice of General Meeting released on 13 April 2021. The LTI plan is being refreshed and the updated plan will be incorporated in the FY23 Notice of Annual General Meeting. Within the FY23 Remuneration Report, PDI has improved transparency, providing detailed disclosure of the LTI awards granted to executives and non-executive directors during FY23 following approval by shareholders at the General Meeting held on 18 July 2022 (see section 4). Looking ahead, the Board is committed to continuing to develop our remuneration and governance framework and how we communicate with our shareholders, ensuring this remains appropriate for our Company’s strategy and position as we grow and mature. As such, we look forward to engaging with shareholders and other stakeholders in the future to discuss our remuneration and governance practices. We thank you for your support and welcome your feedback. Yours faithfully, Simon Jackson Chair of the NRC Annual Report 2023
35
2.KEY MANAGEMENT PERSONNELThroughout this report, key management personnel (KMP) refers to those responsible for planning, directing and controlling the activities of the Company. Compared to FY22, Company Secretary Ian Hobson is no longer considered a KMP and Chris Boreham and Marlyatou Balde are considered KMP. Name Position held as at 30 June 2023 Term as KMP Non-executive KMP Mr Simon Jackson Non-Executive Chair Full year Mr Steven Michael Non-Executive Director Full year Ms Sandra Bates Non-Executive Director Full year Executive KMP Mr Andrew Pardey Managing Director Full year Mr Pierre Louw Chief Financial Officer Full year Ms Marlyatou Balde Country Manager Full year Mr Chris Boreham Project Feasibility Manager Full year 3.REMUNERATION GOVERNANCERemuneration principles The Board employs a range of principles to ensure that remuneration: §Is fair and equitable as well as competitive in the market to ensure the attraction and retention of key talent;§Is determined with reference to a number of factors, including tenure, calibre, skills and the overallperformance of the Company;§Creates a strong link between company performance and executive reward in the short and long term; and§Allows flexibility in the remuneration structure to adjust for evolving strategic goals as the Company progressesthrough new developmental stages.Nomination and remuneration committee The Board formed the NRC in early FY23 after the appointment of Sandra Bates, which meant there were then sufficient independent directors to constitute the committee. The NRC is comprised of Simon Jackson (Chair), Steven Michael and Sandra Bates. The NRC’s responsibilities include the following: §Evaluating the remuneration policy for executives, including the terms and conditions of incentive plans,performance conditions, and approving any incentive payouts to executives.§Evaluating the remuneration for non-executive directors,§Reviewing, managing, and disclosing the policy (if any) under which participants in an equity-basedremuneration scheme may be permitted to enter into transactions (whether through the use of depravities orotherwise) which limit the economic risk of participating in the scheme; and§Determining the content of the Remuneration Report to be included in the Company’s Annual Report.OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 36
Predictive Discovery Limited
4.EXECUTIVE REMUNERATIONIn determining the nature and amount of executive remuneration, the NRC considers PDI’s financial and operational performance together with prevailing market conditions and the remuneration practices of relevant industry peers. PDI has an approved LTI plan, under which participants were provided bespoke grants of options tied to strategic milestones and service tenure, which the Board has considered to be appropriate given PDI’s exploration and development phase, business maturity and strategic objectives. PDI considers that the future success of the Company depends largely on the skills and motivation of those engaged in and overseeing the management of the Company’s operations. The ability for KMP to be a part of and experience this growth alongside PDI through the participation in incentive schemes drives this future success, while attracting and retaining executives of the highest calibre. All executives receive fixed remuneration and are eligible for grants of options under the LTI plan, constituting their LTI opportunity. The following displays the mix between fixed remuneration and LTI at the maximum opportunity level2 for FY23 for executive KMP: A formal short-term incentive plan is not in place at this time to assist with cash conservation. The Board in conjunction with the NRC is conducting an extensive review of PDI’s current remuneration practices in light of stakeholder feedback received at the 2022 AGM. This review includes exploring the possibility of implementing a more structured and regular incentive framework. This process will involve careful deliberation regarding the potential structure and appropriate performance criteria to align with the Company’s short and long-term strategic goals. Fixed remuneration Fixed remuneration is comprised of base salary, superannuation and fringe benefits. PDI’s policy prescribes that fixed remuneration should be fair and reasonable and should consider the expectations of the role, the surrounding labour market, as well as the individual’s calibre, tenure and experience. The NRC regularly reviews the fixed remuneration for executive KMP, however no changes to fixed remuneration were applied during FY23. 2 The LTI maximum opportunity has been derived from the annualised value of ZEPOs and Options granted to the executive KMP, approved by shareholders at the General Meeting held on 18 July 2022. The value is as at the grant date as set out in the tables blow and differs from the valuation used in the statutory accounts. Fixed RemunerationLTIPierre Louw (Chief Financial Officer) Chris Boreham (Project Feasibility Manager) Andrew Pardey (Managing Director) Marlyatou Balde (Country Manager) Annual Report 2023
37
Long-term incentives At the General Meeting held on 18 July 2022, shareholders approved the grant of zero exercise price options (ZEPOs) and Options to the Directors (including the Managing Director). On 3 November 2022, the Directors awarded ZEPOs and Options to senior management in accordance with PDI’s LTI plan. The following table outlines the terms of the grant to the executive KMP: Purpose To align the interests of executive KMP and other senior management with those of the Company and its shareholders. Eligibility The Managing Director, executive KMP and other senior management were eligible to participate. Instrument/s ZEPOs and Options. Number of Instruments The number of ZEPOs and Options granted are as follows: KMP Number of ZEPOs Number of Options Andrew Pardey (MD) 10,000,000 1,500,000 Pierre Louw 7,500,000 4,000,000 Chris Boreham 1,500,000 3,000,000 Marlyatou Balde 1,500,000 3,000,000 Valuation For the purposes of LTI calculation, the value of each ZEPO has been determined using a face value methodology, being the share price on the day the ZEPOs were granted. The ZEPOs were valued at $0.18 (grant date: 18 July 2022) and $0.15 (grant date: 3 November 2022). The Options were valued at $0.110 (grant date: 18 July 2022) and $0.102 (grant date: 3 November 2022) using a Black Scholes valuation model. Vesting conditions ZEPOs have the following vesting conditions: Tranche % of total ZEPOs Service condition Performance-based milestone 1 25% 12 months Announcement of an updated Mineral Resource estimate of at least 6 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project (50% weighting). Board approval of a health, safety and environmental management plan prepared in consultation with suitably qualified and independent third-party consultants (50% weighting). 2 25% 24 months Announcement of an Ore Reserve for the Bankan Gold Project of at least 3 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project (37.5% weighting). Announcement of a positive pre-feasibility study for the Bankan Gold Project (37.5% weighting). Achievement of the following specified health, safety and environmental milestones for the period between 1 January 2022 and 31 December 2022: -Total recordable Injuries Frequency Rate (TRIFR) for Company staff of <2.94.-Zero reportable environmental incidents (including spills, loss of containment, etc.)-Zero community or landowner incidents resulting in the permanent loss of land access on a material private property or the immediate halting of all operations on any site:o100% allocation if no breach o67% allocation if one breacho33% allocation if two breacheso0% allocation if more than two breaches (25% weighting). OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 38
Predictive Discovery Limited
3 50% 36 months Announcement of a positive feasibility study for the Bankan Gold Project. (37.5% weighting). Announcement of the issue of an Exploitation Permit by the Guinea Ministry of Mines and Geology for the Bankan Gold Project. (37.5% weighting). Achievement of the following specified health, safety and environmental milestones for the period between 1 January 2023 and 31 December 2023: -An improvement of at least 10% in the Total Recordable Injuries Frequency Rate (TRIFR) for the 2023 calendar year (in comparison to the 2022 calendar year)-Zero reportable environmental incidents (including spills, loss of containment, etc.) -Zero community or landowner incidents resulting in the permanent loss of land access on a material private property or the immediate halting of all operations on any site: o100% allocation if no breach o67% allocation if one breach o33% allocation if two breaches o0% allocation if more than two breaches(25% weighting). These strategic milestone measures have been selected as they provide direct alignment with PDI’s long term strategy of developing the Company’s key asset, the Bankan Gold Project, into a Tier-1 mine, which will ultimately lead to increased shareholder value. Strategic milestone measures have been paired with health, safety and environmental measures to ensure that this development is achieved in a sustainable manner. Options have the following service-based vesting conditions only: Tranche % of total options Service condition 1 25% 12 months 2 25% 24 months 3 50% 36 months Exercise price ZEPOs have a $nil exercise price by design. Options have an exercise price of $0.30. Expiry date ZEPOs have the following expiry dates: §Tranche 1: 20 July 2025;§Tranche 2: 20 July 2026;§Tranche 3: 20 July 2027.Options expire on 30 June 2026. Cessation of employment Upon a cessation of employment before the relevant service condition has been met, all unvested options will automatically be forfeited by the Participant, unless the Board otherwise determines in its discretion to permit some or all of the options to vest. Malus If the award is viewed as inappropriate given the circumstances that prevail over the performance period, such as in the case of harm to PDI’s stakeholders for which the Participant is accountable, the Board may in its discretion deem all unvested performance rights to have been forfeited. Corporate actions Upon a change of control event, ZEPOs and Options will vest in full, to the satisfaction of the Board in its absolute discretion. Annual Report 2023
39
5.NON-EXECUTIVE DIRECTOR REMUNERATIONNon-executive directors are remunerated by way of fixed fees and ZEPOs and Options in accordance with the LTI plan and as approved by shareholders. The ZEPOs and Options issued in FY23 have time-based vesting conditions (no performance-based vesting conditions). Non-executive directors are not provided with retirement benefits other than statutory superannuation. The Board, within the limit pre-approved by shareholders, determines fees payable to individual non-executive directors. The remuneration level of non-executive directors is determined by the Board after considering levels that apply to similar positions in comparable companies in Australia, taking account of the individual’s possible participation in any equity-based remuneration scheme. The Board may use industry-wide data gathered by independent remuneration experts annually as a point of reference. The fees payable to individual non-executive directors must be determined by the Board within the aggregate sum of $500,000 per annum provided for under Clause 21.1 of the Constitution. That aggregate sum can only be increased with the prior approval of shareholders at a general meeting. A non-executive director is entitled to a refund of approved expenditure and may also receive payments for consultancy work contracted for and performed separately on the Company’s behalf. The annual fee for the Chair of the Board is currently set at $85,000 and the annual fee for board members is $60,000, both inclusive of superannuation. The Board does not intend to review director fees during FY24. Non-executive directors can participate in the Company’s Employee Option Plan and may be granted options from time to time to enhance alignment with shareholder interests and support their ongoing commitment to the Company. Options or shares issued to any director pursuant to any equity-based remuneration scheme require approval by shareholders prior to their issue. At the General Meeting held on 18 July 2022, shareholders approved a grant of options to directors, with a mix of ZEPOs and options. Options are not linked to any performance-based vesting conditions, to protect the independence of non-executive directors. The key terms of the grant are outlined below (refer to Notice of Meeting for additional details): Instrument/s ZEPOs and Options Number of instruments Non-executive director Number of ZEPOs Number of Options Simon Jackson 2,000,000 5,000,000 Steven Michael 2,000,000 500,000 Sandra Bates 2,000,000 3,000,000 Valuation For the purposes of LTI calculation, the value of each ZEPO has been determined using a face value methodology, being the share price on the day the ZEPOs were granted of $0.18 (grant date: 18 July 2022). The Options were valued at $0.110 (grant date: 18 July 2022) using a Black Scholes valuation model. Vesting conditions Service condition only, with 25% subject to a 1-year service condition, 25% subject to a 2-year service condition, and 50% subject to a 3-year service condition. Once the service conditions are met, the relevant tranche of options will vest. Once vested, the options may be exercised thereafter and any time prior to their expiry date. Exercise price ZEPOs have a $nil exercise price by design. Options have an exercise price of $0.30. Expiry date ZEPOs have the following expiry dates: §Tranche 1: 20 July 2025;§Tranche 2: 20 July 2026;§Tranche 3: 20 July 2027.Options expire on 30 June 2026. Cessation of employment Upon a cessation as a Director before the relevant service condition has been met, all unvested options will automatically be forfeited by the Participant, unless the Board otherwise determines in its discretion to permit some or all of the options to vest. Malus If the award is viewed as inappropriate given the circumstances that prevail over the performance period, such as in the case of harm to PDI’s stakeholders for which the Participant is accountable, the Board may in its discretion deem all unvested performance rights to have been forfeited. Corporate actions Upon a change of control event, ZEPOs and Options will vest in full, to the satisfaction of the Board in its absolute discretion. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 40
Predictive Discovery Limited
6.LINK BETWEEN COMPANY PERFORMANCE AND REWARDCompany performance The following table outlines PDI’s financial and operational performance in FY23 and the previous four financial years, intended to assist in demonstrating the link between performance and reward. Due to the Company’s current exploration and development phase, it is not currently appropriate to evaluate the Company’s financial performance using EBITDA and other profitability metrics and, therefore, a summary of the operating losses, cash flows, share price, market capitalisation and Mineral Resource for the Bankan Gold Project has been provided. PDI has achieved significant growth in its share price and market capitalisation over the 5-year period, owing to the discovery of the NEB and BC deposits during FY20 and ongoing exploration success at these deposits, which has resulted in the Bankan Project emerging as the largest gold discovery in West Africa in the latest decade and as a potential future Tier-1 gold mine. During FY22, PDI announced a maiden Mineral Resource for the Bankan Gold Project of 3.65Moz (Inferred) and experienced a significant increase in its share price to $0.20 and market capitalisation to $316M. During FY23, PDI continued resource definition drilling at Bankan, increasing the Mineral Resource to 4.18Moz, which included 1.75Moz in the Indicated category. A Scoping Study and Environmental & Social Impact Assessment (ESIA) were commenced in FY23, which are key documents for Bankan’s permitting process. Subsequent to the end of FY23, PDI increased the Bankan Mineral Resource to 5.38Moz, which includes 4.14Moz in the Indicated category. This latest Mineral Resource estimate will form the basis of the Scoping Study which is scheduled to be completed in late 2023. PDI’s operating losses and negative cash flows reflect the Company’s exploration and development phase, and the increasing level of drilling and study activity over the 5-year period. FY19 FY20 FY21 FY22 FY23 Operating loss after income tax ($) 1,459,332 2,352,700 6,622,404 9,687,702 11,231,323 Cash flows from operating activities ($) (1,526,448) (3,956,625) (14,287,908) (23,042,362) (56,936,056) Share price ($)1 0.015 0.088 0.077 0.200 0.165 Market capitalisation ($M)1 4 73 98 316 341 Bankan Project Mineral Resource1 - - - 3.65Moz (Nil Indicated) 4.18Moz (1.75Moz Indicated) (1)As at 30 June on the relevant financial yearPerformance-based incentive outcomes No performance-based incentives vested during FY23. Annual Report 2023
41
7.STATUTORY REMUNERATION TABLESThe following table of benefits and payment details, in respect to the financial year, the components of remuneration for each member of the key management personnel of the Group and, to the extent different, the five Group executives and five company executives receiving the highest remuneration: Table of Benefits and Payments for the Period Ended 30 June 2023 Key Management Personnel Salary, fees and leave Other Pension and super-annuation Shares/ Units Options/ Rights Total $ $ $ $ $ $ Mr Andrew Pardey 356,781 - - - 806,931 1,163,712 Mr Steven Michael 65,000 - - - 170,450 235,450 Mr Simon Jackson 85,000 - 374,375 459,375 Ms Sandra Bates 60,000 - - - 283,741 343,741 Mr Pierre Louw 312,242 - - - 647,166 959,408 Mr Chris Boreham 295,928 - - - 309,178 605,106 Ms Marlyatou Balde 194,565 - - - 309,178 503,743 Total Key Management Personnel 1,369,516 - - - 2,901,019 4,270,535 Table of Benefits and Payments for the Period Ended 30 June 2022 Key Management Personnel Salary, fees and leave Other Pension and super-annuation Shares/ Units Options/ Rights Total $ $ $ $ $ $ Mr Francis Harper(1) 18,182 -1,818- - 20,000 Mr Paul Roberts (2) 293,881 -29,388- - 323,269 Mr Andrew Pardey 203,417 --- 118,946 322,363 Mr Steven Michael 63,400 --- - 63,400 Mr Simon Jackson (3) 55,255 -55,255 Ms Sandra Bates (4) - - - - - - Mr Ian Hobson 103,300 - - 134,272 18,652 256,224 Mr Pierre Louw(5) 17,405 - - - - 17,405 Total Key Management Personnel 754,840 -31,206134,272 137,598 1,057,916 (1)Resigned 19 October 2021(2)Resigned on 30 June 2022(3)Appointed on 19 October 2021(4)Appointed on 7 June 2022. Ms Bates was not paid any remuneration during FY22.(5)Appointed on 25 May 2022OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 42
Predictive Discovery Limited
KEY MANAGEMENT PERSONNEL OPTIONS AND RIGHTS HOLDINGS The number of options over ordinary shares held by each key management person of the Group during the financial year is as follows: (1)Resigned 19 October 2021(2)Resigned on 30 June 2022(3)Appointed on 19 October 2021(4)Appointed on 7 June 2022. Ms Bates was not paid any remuneration during FY22(5)Appointed on 25 May 2022KEY MANAGEMENT PERSONNEL SHAREHOLDINGS The number of ordinary shares in PDI Discovery Limited held by each key management person of the Group during the financial year is as follows: Balance at beginning of period Granted as remuneration during the period Issued on exercise of options during the period Purchased during the period Other changes during the period Balance at end of period 30 June 2023 Mr Andrew Pardey - - - - - - Mr Steven Michael 366,080 -2,500,000- - 2,866,080 Mr Simon Jackson 260,000 --166,667 -426,667Ms Sandra Bates - - - - --Mr Pierre Louw - - - - --Mr Chris Boreham - - - - --Ms Marlyatou Balde - - - - --626,080 -2,500,000166,667 3,292,747 30 June 2023 Balance at beginning of period Granted as remunerat-ion during the period Expired during the period Other changes during the period Balance at end of period Vested during the period Vested and exercisable Vested and unexercis-able Mr Andrew Pardey 3,500,000 11,500,000 -- 15,000,000-3,500,000- Mr Steven Michael 2,500,000 2,500,000 -(2,500,000) 2,500,000-- Mr Simon Jackson -7,000,000-- 7,000,000--- Ms Sandra Bates -5,000,000-- 5,000,000--- Mr Pierre Louw -11,500,000-- 11,500,000--- Mr Chris Boreham -4,500,000-4,500,000Ms Marlyatou Balde -4,500,000-4,500,0006,000,000 46,500,000 -(2,500,000) 50,000,000-3,500,000- 30 June 2022 Balance at beginning of period Granted as remunerat-ion during the period Expired during the period Other changes during the period Balance at end of period Vested during the period Vested and exercisable Vested and unexercis-able Mr Francis Harper(1) 7,000,000 -- (7,000,000)- - - - Mr Paul Roberts(2) 12,500,000 -- (12,500,000)- - - - Mr Andrew Pardey 3,500,000 - - - 3,500,000 -3,500,000- Mr Steven Michael 2,500,000 - - - 2,500,000 -2,500,000- Mr Simon Jackson (3) - - - - - - - - Ms Sandra Bates(4) - - - - - - - - Mr Ian Hobson 3,000,000 -- (1,000,000) 2,000,000-2,000,000- Mr Pierre Louw(5) - - - - - - - - 28,500,000 -- (20,500,000) 8,000,000-8,000,000- Annual Report 2023
43
KEY MANAGEMENT PERSONNEL SHAREHOLDINGS (Continued) Balance at beginning of period Granted as remuneration during the period Issued on exercise of options during the period Purchased during the period Other changes during the period Balance at end of period 30 June 2022 Mr Francis Harper (1) - - - 4,000,000 (4,000,000) - Mr Paul Roberts (2) 5,974,171 -6,100,000375,000 (12,449,171) - Mr Andrew Pardey - - - - - - Mr Steven Michael 178,580 - - 187,500 -366,080Mr Simon Jackson(3) - - - 260,000 -260,000Ms Sandra Bates(4) - - - - --Mr Ian Hobson 50,880 - - - - 50,880 Mr Pierre Louw(5) - - - - - - 6,203,631 -6,100,0004,822,580 (16,449,171) 676,960 (1)Resigned 19 October 2021(2)Resigned on 30 June 2022(3)Appointed on 19 October 2021(4)Appointed on 7 June 2022(5)Appointed on 25 May 20228.SERVICE AGREEMENTSAll non-executive directors are remunerated on a monthly basis with no fixed term or termination benefits. Each Executive KMP has entered an employment contract with the Group. Details of the relevant contracts are set out below: Executive KMP Duration of service agreement Notice period Termination entitlements (without cause) Termination entitlements (with cause) Andrew Pardey (MD) Ongoing 6 months 6 months balance due at termination date Pierre Louw (CFO) Ongoing 6 months 6 months balance due at termination date Mr Chris Boreham (Project Feasibility Engineer) 2 year renewable contract 3 months 3 months balance due at termination date Ms Marlyatou Balde (Country Manager) Ongoing 3 months 3 months balance due at termination date 9.OTHER TRANSACTIONS WITH KMPIt is the policy of the Company that persons to whom options have been issued should not enter into any transaction in any associated product which is designed to limit the economic risk of participating in unvested entitlements under an equity-based remuneration scheme. END OF THE REMUNERATION REPORT Simon Jackson Chair of the NRC 18 September 2023 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 44
Predictive Discovery Limited
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2023 The accompanying notes form part of these financial statements Note Consolidated 2023 $ 2022 $ Finance income 632,838 3,113 Other income - - Share based payments 14 (3,880,848) (731,130) Administrative expenses 2 (1,785,873) (1,544,165) Depreciation of fixed assets (379,971) (221,747) Depreciation – Rights of Use Assets (144,085) - Loss on disposal of fixed asset (6,528) - Foreign exchange gain/(loss) (506,264) 313,645 Employee benefits expense (352,262) (309,962) VAT Expense 17 (2,521,633) (918,837) Indirect Foreign taxes 4 950,527 (1,682,894) Cost to dispose of subsidiaries 3 (285,406) - Impairment of exploration expenditure 9 -(2,011,363)Exploration expenditure pre-right to tenure (2,951,818) (2,584,362)Loss before income tax (11,231,323) (9,687,702) Income tax expense 5 - - Loss from continuing operations (11,231,323) (9,687,702) Other comprehensive income Items that may be reclassified to profit or loss Exchange difference on translation of foreign operations 1,001,760 4,025,911 Total comprehensive loss for the year (10,229,563) (5,661,791) Loss attributable to: Members of the parent entity (10,229,563) (5,661,791) (10,229,563) (5,661,791) Basic loss per share (cents per share) 13 (0.6) (0.7) Diluted loss per share (cents per share) 13 (0.6) (0.7) Annual Report 2023
45
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023 Note Consolidated 2023 $ 2022 $ Current Assets Cash and cash equivalents 6(a) 44,894,558 42,035,541 Trade and other receivables 7 500,985 404,150 Total current assets 45,395,543 42,439,691 Non-Current Assets Property, plant and equipment 8 878,692 811,526 Exploration expenditure 9 87,201,892 37,376,965 Right of use assets 312,188 - Total non-current assets 88,392,772 38,188,491 Total assets 133,788,315 80,628,182 Current Liabilities Trade and other payables 10 4,631,848 6,548,463 Right of use liabilities 313,241 - Total current liabilities 4,945,089 6,548,463 Total liabilities 4,945,089 6,548,463 Net Assets 128,843,226 74,079,719 Equity Issued capital 11 175,912,716 113,950,491 Reserves 10,205,298 6,411,395 Accumulated losses (57,274,788) (46,282,167) Total Equity 128,843,226 74,079,719 The accompanying notes form part of these financial statements. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 46
Predictive Discovery Limited
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2023 Issued Capital Accumulated Losses Foreign Currency Translation Reserve Share Based Payments Reserve Total CONSOLIDATED $ $ $ $ $ At 1 July 2021 71,376,018 (36,628,347) 2,083 1,541,627 36,291,381 Loss for the year -(9,687,702)- - (9,687,702) Other comprehensive income --4,025,911 -4,025,911Total comprehensive loss for the year -(9,687,702)4,025,911 -(5,661,791)Transactions with owners in their capacity as owners: Transfer of expired/lapsed options -33,882-(33,882)- Transfer options exercised from reserve to share capital 298,887 (298,887)- Issue of share capital 45,048,347 - - -45,048,347 Share-based payments - - - 731,130731,130 Options issued to brokers (443,413) - - 443,413- Transaction costs (2,329,348) - - - (2,329,348) At 30 June 2022 113,950,491 (46,282,167) 4,027,994 2,383,401 74,079,719 At 1 July 2022 113,950,491 (46,282,167) 4,027,994 2,383,401 74,079,719 Loss for the year -(11,231,323)- - (11,231,323) Other comprehensive income --1,001,760 -1,001,760Total comprehensive loss for the year -(11,231,323)1,001,760 -(10,229,563)Transactions with owners in their capacity as owners: Transfer of expired/lapsed options -238,702-(238,702)- Transfer options exercised from reserve to share capital 850,003 (850,003)- Issue of share capital 64,231,405 - - -64,231,405 Share-based payments - - - 3,880,8483,880,848 Options issued to brokers - - - - - Transaction costs (3,119,183) - - - (3,119,183) At 30 June 2023 175,912,716 (57,274,788) 5,029,754 5,175,544 128,843,226 The accompanying notes form part of these financial statements. Annual Report 2023
47
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2023 Note Consolidated 2023 2022 $ $ Cash flows from operating activities Interest received 632,838 3,113 Government grant received - - Payments to suppliers and employees (4,925,324) (1,665,208) Payments for exploration expenditure (52,643,570) (21,380,268) Net cash provided by (used in) operating activities 6(b) (56,936,056) (23,042,362) Cash flows from investing activities Purchase of property, plant and equipment (493,844) (712,097) Disposal of property, plant and equipment 40,178 - Net cash provided by (used in) investing activities (453,666) (712,097) Cash flows from financing activities Proceeds from issue of shares 60,727,646 44,043,679 Proceeds from advance share subscription -498,391Proceeds on exercise of options 3,005,858 848,108Payment for share issue costs (3,065,119) (2,329,347) Net cash inflow from financing activities 60,668,385 43,060,831 Net increase (decrease) in cash held 3,278,663 19,306,372 Foreign exchange differences (419,646) - Cash and cash equivalents at beginning of financial period 42,035,541 22,729,169 Cash and cash equivalents at end of the financial period 6(a) 44,894,558 42,035,541 The accompanying notes form part of these financial statements OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 48
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTES TO THE FINANCIAL STATEMENTS This financial report includes the consolidated financial statements and notes of PDI Discovery Limited and controlled entities (the “Group”). NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PDI Discovery Limited is a for-profit company limited by shares, incorporated and domiciled in Australia. Basis of preparation The financial report is a general-purpose financial statement that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below and have been consistently applied unless otherwise stated. The financial report has been prepared on an accruals basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected financial assets and financial liabilities. The financial statements were authorised for issue, in accordance with a resolution of the directors, on 19 September 2023. The directors have the power to amend and re-issue the financial statements. These financial statements are presented in Australian dollars, rounded to the nearest dollar. (a)Principles of consolidationThe consolidated financial statements incorporate the assets, liabilities and results of entities controlled by PDI Discovery Limited at the end of the reporting period. A controlled entity is any entity over which PDI Discovery Limited has the power to govern the financial and operating policies so as to obtain benefits from the entity's activities. Control will generally exist when the parent owns, directly or indirectly through subsidiaries, more than half of the voting power of an entity. In assessing the power to govern, the existence and effect of holdings of actual and potential voting rights are also considered. Where controlled entities have entered or left the Group during the year, the financial performance of those entities are included only for the period of the year that they were controlled. A list of controlled entities is contained in Note 24 to the financial statements. As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial statements as well as their results for the year then ended. Where controlled entities have entered (left) the Group during the year, their operating results have been included (excluded) from the date control was obtained (ceased). In preparing the consolidated financial statements, all inter-Group balances and transactions between entities in the Group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by the parent entity. Non-controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a parent, are shown separately within the Equity section of the consolidated statement of financial position and consolidated statement of comprehensive income. The non-controlling interests in the net assets comprise their interests at the date of the original business combination and their share of changes in equity since that date. Subsidiaries are accounted for in the parent entity at cost. Annual Report 2023
49
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (a)Principles of consolidation (continued)Business Combinations Business combinations occur where an acquirer obtains control over one or more businesses and results in the consolidation of its assets and liabilities. A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control. The acquisition method requires that for each business combination one of the combining entities must be identified as the acquirer (i.e., parent entity). The business combination will be accounted for as at the acquisition date, which is the date that control over the acquiree is obtained by the parent entity. At this date, the parent shall recognise, in the consolidated accounts, and subject to certain limited exceptions, the fair value of the identifiable assets acquired and liabilities assumed. In addition, contingent liabilities of the acquiree will be recognised where a present obligation has been incurred and its fair value can be reliably measured. The acquisition may result in the recognition of goodwill or a gain from a bargain purchase. The method adopted for the measurement of goodwill will impact on the measurement of any non-controlling interest to be recognised in the acquiree where less than 100% ownership interest is held in the acquiree. The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair value of any previously held equity interest shall form the cost of the investment in the separate financial statements. Consideration may comprise the sum of the assets transferred by the acquirer, liabilities incurred by the acquirer to the former owners of the acquiree and the equity interests issued by the acquirer. Fair value uplifts in the value of pre-existing equity holdings are taken to the statement of comprehensive income. Where changes in the value of such equity holdings had previously been recognised in other comprehensive income, such amounts are recycled to profit or loss. Included in the measurement of consideration transferred is any asset or liability resulting from a contingent consideration arrangement. Any obligation incurred relating to contingent consideration is classified as either a financial liability or equity instrument, depending upon the nature of the arrangement. Rights to refunds of consideration previously paid are recognised as a receivable. Subsequent to initial recognition, contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an asset or a liability is remeasured each reporting period to fair value through the statement of comprehensive income unless the change in value can be identified as existing at acquisition date. All transaction costs incurred in relation to the business combination are expensed to the statement of comprehensive income. Interests in joint arrangements IFRS defines a joint arrangement as one over which two or more parties have joint control, which is the contractually agreed sharing of control over an arrangement. This exists only when the decisions about the relevant activities (being those that significantly affect the returns of the arrangement) require the unanimous consent of the parties sharing control. (i)Joint operationsA joint operation is a type of joint arrangement whereby the parties that have joint control of the arrangement have rightsto the assets and obligations for the liabilities, relating to the arrangement. In relation to its interests in joint operations,the Group recognises its:§Assets, including its share of any assets held jointly.§Liabilities, including its share of any liabilities incurred jointly.§Revenue from the sale of its share of the output arising from the joint operation.§Share of the revenue from the sale of the output by the joint operation.§Expenses, including its share of any expenses incurred jointly.OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 50
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (a)Principles of consolidation (continued)(ii)Joint venturesA joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have rightsto the net assets of the joint venture. The Group’s investment in its joint venture is accounted for using the equity method.Under the equity method, the investment in the joint venture is initially recognised at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s share of net assets of the joint venture since the acquisition date. Goodwill relating to the joint venture is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. The statement of profit or loss and other comprehensive income (OCI) reflects the Group’s share of the results of operations of the joint venture. Any change in OCI of that investee is presented as part of the Group’s OCI. In addition, when there has been a change recognised directly in the equity of the joint venture, the Group recognises its share of any changes, when applicable, in the statement of changes in equity. Unrealised gains and losses resulting from transactions between the Group and the joint venture are eliminated to the extent of the interest in the joint venture. The aggregate of the Group’s share of profit or loss of the joint venture is shown on the face of the statement of profit or loss and other comprehensive income outside operating profit and represents profit or loss after tax and non-controlling interests in the subsidiaries of joint venture. The financial statements of the joint venture are prepared for the same reporting period as the Group. When necessary, adjustments are made to bring the accounting policies in line with those of the Group. At each reporting date, the Group determines whether there is objective evidence that the investment in the joint venture is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between the recoverable amount of the joint venture and its carrying value, then recognises the loss as ‘Share of profit of a joint venture’ in the statement of profit or loss and other comprehensive income. On loss of joint control over the joint venture, the Group measures and recognises any retained investment at its fair value. Any difference between the carrying amount of the joint venture upon loss of joint control and the fair value of the retained investment and proceeds from disposal is recognised in the statement of profit or loss. (iii)Reimbursement of the costs of the operator of the joint arrangementWhen the Group, acting as an operator or manager of a joint arrangement, receives reimbursement of direct costsrecharged to the joint arrangement, such recharges represent reimbursements of costs that the operator incurred as anagent for the joint arrangement and therefore have no effect on profit or loss. When the Group charges a management fee(based on a fixed percentage of total costs incurred for the year) to cover other general costs incurred in carrying out theactivities on behalf of the joint arrangement, it is not acting as an agent. Therefore, the general overhead expenses and themanagement fee are recognised in the statement of profit or loss and other comprehensive income as an expense andincome, respectively.(b)Revenue recognitionThe Group recognises revenue as follows: Interest Interest revenue is recognised using the effective interest rate method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Other revenue Other revenue is recognised when it is received or when the right to receive payment is established. All revenue is stated net of the amount of goods and services tax (GST). Annual Report 2023
51
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (c)Income TaxThe income tax expense (income) for the year comprises current income tax expense (income) and deferred tax expense (income). Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at the end of the reporting period. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority. Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well as unused tax losses. Current and deferred tax expense (income) is charged or credited directly to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to equity. Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss. Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of the reporting period. Their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability. Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised. Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future. Current assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled. (d)Employee BenefitsProvision is made for the company's liability for employee benefits arising from services rendered by employees to the end of the reporting period. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled. Employee benefits payable later than one year have been measured at present value of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy vesting requirements. Those cashflows are discounted using market yields on corporate bonds with terms to maturity that match the expected timing of cashflows. Liabilities recognised in respect of employee benefits which are not expected to be settled within 12 months are measured at the present value of the estimated future cash outflows to be made by The Group in respect of services provided by employees up to reporting date. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 52
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (e)ProvisionsProvisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured. The liability for long service leave is recognised in current and non-current liabilities, depending on the unconditional right to defer settlement of the liability for at least 12 months after the reporting date. (f)Foreign Currency Transactions and BalancesThe functional currency of each of the Group's entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity's functional and presentation currency. All other companies within the Group have Australian dollars as their functional currency. Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined. Exchange differences arising on the translation of monetary items are recognised in the consolidated statement of comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the consolidated statement of comprehensive income. The financial results and position of foreign operations whose functional currency is different from the Group's presentation currency are translated as follows: §assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;§income and expenses are translated at average exchange rates for the period; and§retained earnings are translated at the exchange rates prevailing at the date of the transaction.Exchange differences arising on translation of foreign operations are transferred directly to the Group's foreign currency translation reserve in the consolidated statement of financial position. These differences are recognised in the consolidated statement of comprehensive income in the period in which the operation is disposed. (g)Cash and Cash EquivalentsCash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short term borrowings in current liabilities in the statement of financial position. (h)Investments and other financial assetsInvestments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting mismatch is being avoided. Annual Report 2023
53
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (h)Investments and other financial assets (continued)Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, its carrying value is written off. Financial assets at fair value through profit or loss Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss. Financial assets at fair value through other comprehensive income Financial assets at fair value through other comprehensive income include equity investments which the Group intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition. Impairment of financial assets The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Group's assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain. Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate. For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss. (i)Property, Plant and EquipmentEach class of property, plant and equipment is carried at cost or fair value as indicated, less, where applicable, any accumulated depreciation and impairment losses. Plant and Equipment Plant and equipment are measured on the cost basis. Depreciation The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset's useful life to the Group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The estimated useful lives used for each class of depreciable assets are: Class of Fixed Asset Useful Life Plant and Equipment 2 - 10 years The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 54
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (i)Property, Plant and Equipment (continued)An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the consolidated statement of comprehensive income. Property, plant and equipment is derecognised and removed from the consolidated statement of financial position on disposal or when no future economic benefits are expected. Gains and losses from derecognition are measured as the difference between the net disposal proceeds, if any, and the carrying amount and are recognised in profit or loss. Subsequent costs are included in the property, plant and equipment's carrying value or recognised as a separate asset when it is probable that future economic benefits associated with the item will be realised and the cost of the item can be measured reliably. All other repairs and maintenance are recognised in profit or loss. Where required by accounting standards comparative figures have been adjusted to conform with changes in presentation for the current financial year. (j)Exploration and Development ExpenditureCosts Carried Forward Costs arising from exploration and evaluation activities are carried forward where the rights to tenure for the area of interest are current and such costs are expected to be recouped through successful development, or by sale, or where exploration and evaluation activities have not, at reporting date, reached a stage to allow a reasonable assessment regarding the existence of economically recoverable reserves. Costs carried forward in respect of an area of interest that is abandoned are written off in the period in which the decision to abandon is made. Contributions received from third parties in exchange for participating interests in exploration and evaluation tenements (e.g. as part of farm out arrangements) are netted off against the costs carried forward in respect of those tenements in which the third party acquires a participating interest. (k)Impairment of AssetsAt each reporting date, the Group assesses whether there is any indication that an asset may be impaired. The assessment will include considering external sources of information including, dividends received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition profits. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell and value in use to the asset's carrying value. Any excess of the asset's carrying value over its recoverable amount is expensed to the consolidated statement of comprehensive income. Impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where an impairment loss on a revalued asset is identified, this is debited against the revaluation surplus in respect of the same class of asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same class of asset. Annual Report 2023
55
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (k)Impairment of Assets (continued)Non-financial assets, other than inventories, deferred tax assets, assets from employee benefits, investment properties and deferred acquisition costs, are assessed for any indication of impairment at the end of each reporting period. Any indication of impairment requires formal testing of impairment by comparing the carrying amount of the asset to an estimate of the recoverable amount of the asset. An impairment loss is calculated as the amount by which the carrying amount of the asset exceeds the recoverable amount of the asset. Intangible assets with an indefinite useful life and intangible assets not yet available for use are tested for impairment annually regardless of whether there is any indication of impairment. The recoverable amount is the greater of the asset's fair value less costs to sell and its value in use. The asset's value in use is calculated as the estimated future cash flows discounted to their present value using a pre-tax rate that reflects current market assessments of the time value of money and the risks associated with the asset. Assets that cannot be tested individually for impairment are grouped together into the smallest group of assets that generates cash inflows (the asset's cash generating unit). Impairment losses are recognised in profit or loss. Impairment losses are allocated first, to reduce the carrying amount of any goodwill allocated to cash generating units, and then to other assets of the group on a pro rata basis. Assets other than goodwill are assessed at the end of each reporting period to determine whether previously recognised impairment losses may no longer exist or may have decreased. Impairment losses recognised in prior periods for assets other than goodwill are reversed up to the carrying amounts that would have been determined had no impairment loss been recognised in prior periods. (l)AssociatesAssociates are entities over which the Group has significant influence but not control or joint control. Investments in associates are accounted for using the equity method. Under the equity method, the share of the profits or losses of the associate is recognised in profit or loss and the share of the movements in equity is recognised in other comprehensive income. Investments in associates are carried in the statement of financial position at cost plus post-acquisition changes in the Group's share of net assets of the associate. Goodwill relating to the associate is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. Dividends received or receivable from associates reduce the carrying amount of the investment. When the Group's share of losses in an associate equal or exceeds its interest in the associate, including any unsecured long-term receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate. The Group discontinues the use of the equity method upon the loss of significant influence over the associate and recognises any retained investment at its fair value. Any difference between the associate's carrying amount, fair value of the retained investment and proceeds from disposal is recognised in profit or loss. (m)Trade and Other PayablesTrade and other payables represent the liability outstanding at the end of the reporting period for goods and services received by the Group during the reporting period which remain unpaid. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability. (n)Goods and Services Tax (GST)Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the consolidated statement of financial position are shown inclusive of GST. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 56
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (o)Earnings Per ShareBasic loss per share is calculated as net loss attributable to members of the Group divided by the weighted average number of ordinary shares. Diluted loss per share is calculated by adjusting the net loss attributable to members of the Group and the number of shares outstanding for the effects of all dilutive potential ordinary shares, which include shares options. (p)Contributed EquityOrdinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown as a deduction, net of tax, from the proceeds. (q)Share-based Payment TransactionsEmployees of the Group receive remuneration in the form of share-based payment transactions, whereby employees render services in exchange for equity instruments ("equity settled transactions"). When the goods or services acquired in a share-based payment transaction do not qualify for recognition as assets, they are recognised as expenses. The cost of equity settled transactions and the corresponding increase in equity is measured at the fair value of the goods or services acquired. Where the fair value of the goods or services received cannot be reliably estimated, the fair value is determined indirectly by the fair value of the equity instruments using the Black Scholes option valuation technique. Equity-settled transactions that vest after employees complete a specified period of service are recognised as services are received during the vesting period with a corresponding increase in equity. (r)Critical Accounting Estimates and JudgementsThe directors evaluate estimates and judgments incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. Key estimates – Impairment The Group assesses impairment at the end of each reporting period by evaluating conditions specific to the Group that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using fair value less cost to sell. Key judgements – Exploration and Evaluation Expenditure The Group capitalises expenditure relating to exploration and evaluation where it is considered likely to be recoverable or where the activities have not reached a stage which permits a reasonable assessment of the existence of reserves. $87,201,892 has been capitalised as at 30 June 2023 (see note 9). While there are certain areas of interest from which no reserves have been extracted, the directors are of the continued belief that such expenditure should not be written off since feasibility studies in such areas have not yet concluded and there are no facts of circumstances that suggest the carrying amounts of the exploration and evaluation assets recognised exceed their recoverable amount. In assessing the recoverability of the carrying amounts, the Directors have determined that as with similar companies, future capital raisings will be required in order to continue the exploration and development of the company's mining tenements (some subject to an option payment) to achieve a position where they can prove exploration reserves. Should there be no funding available, exploration of the areas of interest may be put on hold. The recoverability of the exploration asset is dependent upon the continued exploration of each area of interest. Key Judgements – Share-based payment transactions The Group measures the cost of equity settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined using the Black Scholes method. The related assumptions are detailed in note 14. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact expenses and equity. Annual Report 2023
57
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (r)Critical Accounting Estimates and Judgements (continued)Key Judgements - Recoverability of Intercompany Loan Within non-current assets of the parent entity (see note 24) there is a loan due from the 100% subsidiaries of $90,717,226 is considered fully recoverable. The recoverability of this loan is dependent upon the successful development or sale of exploration assets in Guinea. Key Judgements - Joint arrangements Judgement is required to determine when the Group has joint control, which requires an assessment of the relevant activities and when the decisions in relation to those activities require unanimous consent. The Group has determined that the relevant activities for its joint arrangements are those relating to the operating and capital decisions of the arrangement, such as: the approval the capital expenditure programme for each year, and appointing, remunerating and terminating the key management personnel or service providers of the joint arrangement. The considerations made in determining joint control are similar to those necessary to determine control over subsidiaries. Judgement is also required to classify a joint arrangement. Classifying the arrangement requires the Group to assess their rights and obligations arising from the arrangement. Specifically, it considers: §The structure of the joint arrangement – whether it is structured through a separate vehicle§When the arrangement is structured through a separate vehicle, the Group also considers the rights andobligations arising from:§The legal form of the separate vehicle§The terms of the contractual arrangement§Other facts and circumstances (when relevant)This assessment often requires significant judgement, and a different conclusion on joint control and also whether the arrangement is a JO or a JV, may materially impact the accounting. The Group has a joint arrangement which is structured through a separate vehicle, being a company structure. This structure, and the terms of the contractual arrangement indicate that the Group has rights to the net assets of the arrangement. Given this, the Group then had to assess the other facts and circumstances relating to this arrangement. After undertaking this assessment, there were a number of indicators for both a joint venture classification and a joint operation classification. Significant judgement was therefore required to determine how these factors would be analysed. The final conclusion was that the arrangement was a joint venture. (s)Adoption of New and Revised Accounting StandardsThe Group has adopted all of the new and revised Accounting Standards and Interpretations issued by the AustralianAccounting Standards Board that are mandatory for the current reporting period. The adoption of these new and revisedAccounting Standards and Interpretations has not resulted in a significant or material change to the Group’s accountingpolicies.Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted by the consolidated entity. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 58
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 Consolidated 30 June 2023 $ 30 June 2022 $ NOTE 2: ADMINISTRATIVE EXPENSES Legal, professional and consultancy fees 325,357 406,020 Advertising and marketing 576,546 301,520 Compliance fees 135,519 155,618 Recruitment fees 129,318 104,945 IT & telecommunication expenses 196,432 97,728 Travel and accommodation fees 157,076 28,156 Insurance 105,154 82,605 Other expenses 160,471 367,574 1,785,873 1,544,165 NOTE 3: COST TO DISPOSE OF SUBSIDIARIES During the financial year ended 30 June 2023, the Company decided to close all of its subsidiaries in Burkina Faso and to surrender active permits to the respective authorities in-country. The main reason being safety concerns in country and to allow the team to concentrate on the Guinea activities. The total cost to dispose the entities amounted to $285,406. This includes legal cost, cost to compensate employees and other administration fees. (a)Gayeri Resources SARLOn the 30 August 2022, Gayeri Resources SARL was dissolved. Gayeri Resources SARL was inactive and there was noprofit or loss on disposal on 30 August 2022.(b)Burkina Faso SARL, PD SARL and Progress Mineral SARLOn the 31 January 2023, Burkina Faso SARL, PD SARL and Progress Mineral SARL were dissolved. The cost tomaintain tenements and pay employees amounted to $143,072 for the period July to October 2022. These costswere expensed as administrative expenses in the Profit and Loss.Consolidated 30 June 2023 $ 30 June 2022 $ NOTE 4: INDIRECT FOREIGN TAXES Indirect foreign taxes - Guinea 950,527 (1,682,894) 950,527 (1,682,894) The provision for foreign indirect taxes is in respect of the Company’s tenements held in Guinea. At 30 June 2021, the value added tax (VAT) for prior periods up to December 2020 was disclosed as a contingent liability as the magnitude of this liability could not be reliably determined, pending formal assessment by the Guinea tax authorities. Subsequently, this liability was confirmed at $243,384 and fully paid during the year ended 30 June 2022. In addition, a VAT provision of $1,439,510 for the period from 1 January to 30 November 2021 had been made based on a final assessment of the tax liability by independent tax advisors in Guinea. The total provision for foreign indirect taxes at 30 June 2022 amounted to $1,774,265. Following a formal assessment by the Guinea tax authorities on Mamou Resources SARL, the tax liability was $353,905 and this has been paid on the 15 June 2023. The tax liability of Mamou Resources SARL was overprovided for an amount of $950,527 and this has been written off as at 30 June 2023. The tax liability provided for Kindia Resources SARL was $135,077. This amount is still due and will be paid for once a formal assessment by the Guinea tax authorities is performed on Kindia Resources. Annual Report 2023
59
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 5: INCOME TAX Consolidated 2023 $ 2022 $ (a)Income tax expense/benefitThe components of income tax expense/benefit comprise: Current tax - - Deferred tax - - - - (b)Reconciliation of income tax expense/(benefit) to prima facie taxpayable on accounting profit/(loss)Operating (loss) before income tax (11,231,323) (9,687,702) Prima facie tax benefit at Australian rate of 25% (2022: 25%) 2,807,831 2,421,926 Adjusted for tax effect of the following amounts: Taxable/non-deductible items (2,356,421) (2,306,857) Non-taxable/deductible items 405,183 266,707 Deferred tax expense relating to change in tax rate - - Deferred tax benefit relating to under-provision in prior year - - Income tax benefit not brought to account (856,593) (381,776) Income tax benefit - - (c)Deferred tax assets and liabilities not brought to accountThe directors estimate that the potential deferred tax assets and liabilitiescarried forward but not brought to account at year end at the Australiancorporate tax rate of 25% (2020: 27.5%) are made up as follows:On income tax accountCarry forward tax losses8,476,560 7,662,198 Deductible temporary differences14,196 8,163 Taxable temporary differences(21,904) (58,101) 8,468,852 7,612,260 These benefits will only be obtained if: (i)the group derives future assessable income of a nature and of an amount sufficient to enable the benefits from the deductions for the losses to be realised, (ii)the group continues to comply with the conditions for deductibility imposed by tax legislation, and(iii)no changes in tax legislation adversely affect the group in realising the benefit from the deduction for the losses.NOTE 6(a): CASH AND CASH EQUIVALENTS Consolidated 2023 $ 2022 $ Cash at bank 44,894,558 42,035,541 44,894,558 42,035,541 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 60
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 6: CASH AND CASH EQUIVALENTS (continued) NOTE 6(b): Reconciliation of loss after income tax to net cash flow from operating activities 2023 $ 2022 $ Operating loss after income tax (11,231,323) (9,687,702) Non-operating items in loss: Non-cash flows in loss: Loss on deregistered entity 285,406 - Movement in provision (950,527) - Depreciation 524,058 221,747 Exchange difference on translation of foreign operations (633,249) 1,252,285 Provision for doubtful debts 2,521,633 918,837 Impairment of exploration expenditure -2,011,363 Loss on disposal of plant 6,528 - Share based Payment 3,880,846 731,130 Movement in assets and liabilities: (Increase)/decrease in assets (50,233,952) (22,043,204) Increase/(decrease) in liabilities (1,105,476) 3,553,182 Net cash outflow from operating activities (56,936,056) (23,042,362) NOTE 7: TRADE AND OTHER RECEIVABLES Other receivables 500,985 404,150 500,985 404,150 NOTE 8: PLANT AND EQUIPMENT Plant and Equipment 1,565,213 1,111,491 Accumulated depreciation (686,521) (299,965) 878,692 811,526 A reconciliation of the carrying amounts of each class of plant and equipment between the beginning of the current financial year is set out below: Plant and Equipment $ Total $ 2023 Balance at the beginning of year 811,526 811,526 Additions 493,844 493,844 Disposal (46,707) (46,707) Depreciation expense (379,971) (379,971) Balance at the end of the year 878,692 878,692 2022 Balance at the beginning of year 321,176 321,176 Additions 712,097 712,097 Depreciation expense (221,747) (221,747) Balance at the end of the year 811,526 811,526 Annual Report 2023
61
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 9: EXPLORATION, EVALUATION AND DEVELOPMENT ASSETS 2023 $ 2022 $ Exploration and evaluation expenditure 87,201,892 37,376,965 87,201,892 37,376,965 Exploration and Evaluation 2023 $ Balance at beginning of the year 37,376,965 Expenditure incurred 49,824,927 Expenditure acquired - Impairment of capitalised exploration- Balance at the end of the year 87,201,892 2022 $ Balance at beginning of the year 15,505,090 Expenditure incurred 23,883,238 Expenditure acquired - Impairment of capitalised exploration (2,011,363) Balance at the end of the year 37,376,965 The Group has capitalised exploration expenditure of $87,201,892 (30 June 2022: $37,376,965). This amount includes costs directly associated with exploration and the purchase of exploration properties. These costs are capitalised as an exploration asset until assessment and / or drilling of the permit is complete and the results have been evaluated. These direct costs include employee remuneration, materials, permit rentals and payments to contractors. The expenditure is carried forward until either the area moves into the development phase, is abandoned or sold. The ultimate recovery of the carrying value of exploration expenditure is dependent upon the successful development and commercial exploitation or, alternatively, sale of the interest in the tenements. Rights of tenue in Guinea are issued by the Ministry of Mines. Permit status for Mamou Resources SARLU and Kindia Resources SARLU as at 30 June 2023 are as follows: §Kaninko, the permit holding the Mineral Resource was renewed and confirmed in a letter from the Ministry on29 October 2022§Bokoro permit is current§Nonta and Saman permits are being processed by the Ministry of MinesThe status of the Joint Venture permits are as follows: §Argo and Koundian 1,2,3 and 4 are all being processed by the Ministry of Mines.Environmental authorisation was received on 10 March 2023. This authorisation allows PDI to continue its exploration activities on the Bankan site. In the event of delays in permitting, PDI relies on article 78 of the Mining Code that allows for permits to be extended automatically until the date of renewal. The risk of non-renewal of a permit will result in the impairment of expenditure on the specific permit. The Company has no reason to believe that the current permits under renewal will not be issued. Subsequently, the Directors are of the opinion that the exploration expenditure is recoverable for the amount stated in the financial report. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 62
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 10: CURRENT TRADE AND OTHER PAYABLES 2023 $ 2022 $ Trade and other payables 4,340,164 4,774,198 Foreign indirect tax provision (refer to note 4) 291,684 1,774,265 4,631,898 6,548,463 NOTE 11: ISSUED CAPITAL ORDINARY SHARES Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital. 2023 $ 2022 $ 2,067,244,088 (30 June 2022: 1,582,048,031) Ordinary Shares 187,267,327 122,185,920 Share issue costs written off against issued capital (11,354,611) (8,235,429) 175,912,716 113,950,491 Shares Issue Price Total No. $ At 1 July 2022 1,582,048,031 -122,185,920Issue of shares - Capital raising 16,081,697 $0.18 2,894,700Issue of shares in Placement 99,359,878 $0.18 17,884,765Issue of shares – Capital raising 269,640,533 $0.15 40,446,080 Issue of shares from exercise of options 74,531,461 $0.018 1,340,833 Issue of shares from exercise of options 2,500,000 $0.011 27,500 Issue of shares from exercise of options 16,607,741 $0.0986 1,637,523 Exercise of employee options to shares - cashless 6,474,747 - - Transfer from Reserves to share capital - - 850,006 At 30 June 2023 2,067,244,088 187,267,327 At 1 July 2021 1,268,491,755 -76,838,685Issue of shares in placement 81,580,127 $0.08 6,526,410Issue of shares in placement 8,000,000 $0.071 568,000 Exercise of listed options to shares 8,774,601 $0.018 157,943 Exercise of unlisted options to shares 6,904,259 $0.0986 680,760 Exercise of employee options to shares - cashless 2,101,541 - - Issue of shares – Capital raising 206,195,748 $0.18 37,115,235 Transfer from Reserves to share capital 298,887 At 30 June 2022 1,582,048,031 122,185,920 Listed Options Unlisted Options No. No. At 1 July 2022 75,856,884 64,595,741 Issue of Options -56,000,000Exercise of listed options to shares (74,531,461) - Exercise of unlisted options to shares -(19,107,741)Exercise of employee options to shares - cashless -(12,988,000)Options cancelled/expired (1,325,423) (7,500,000)At 30 June 2023 -81,000,000 Annual Report 2023
63
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 11: ISSUED CAPITAL (Continued) Listed Options Unlisted Options No. No. At 1 July 2021 84,631,485 69,000,000 Issue of Options -13,500,000Exercise of listed options to shares (8,774,601) - Exercise of unlisted options to shares -(6,904,259)Exercise of employee options to shares - cashless -(4,000,000)Options cancelled/expired -(7,000,000)At 30 June 2022 75,856,884 64,595,741 OPTIONS For information relating to the PDI Discovery Limited employee option plan, including details of options issued, exercised and lapsed during the financial year and the options outstanding at year end, refer to Note 14. NOTE 12: RESERVES FOREIGN CURRENCY TRANSLATION RESERVE Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive income foreign currency translation reserve. The cumulative amount is reclassified to profit or loss when the net investment is disposed of. OPTION RESERVE The option reserve records items recognised as expenses on valuation of employee share options, refer to Note 14. NOTE 13: EARNINGS PER SHARE 2023 $ 2022 $ Reconciliation of loss Loss used in calculating earnings per share – basic and diluted (11,231,323) (9,687,702) Net loss for the reporting period (11,231,323) (9,687,702) Weighted average number of ordinary shares outstanding during the year used in the calculation of basic and diluted earnings per share 1,764,613,613 1,373,148,452 NOTE 14: SHARE BASED PAYMENTS During the year ended 30 June 2023, the Group granted the following options as share-based payment: §29,500,000 unlisted options exercisable at $0.30 expiring in 3 years as part of the long-term employee incentiveplan1,2§26,500,000 Zero Exercise Price Options as part of the long-term employee incentive plan3,4The options issued during the financial year were valued by applying a Black-Scholes option pricing model taking into account the terms and conditions upon which the options were granted. The following table lists the inputs to the model for the options: 1.On 20 July 2022, 10,000,000 options at a price of $0.30 expiring 30 June 2026 were issued as part of the long-term employee incentive plan. The vesting conditions are as follows:(i)25% of the options vest 12 months from the date of issue of the options provided the offereeremains a director of the company at the vesting date;(ii)25% of the options vest 24 months from the date of issue of the options provided the offereeremains a director of the company at the vesting date;(iii)50% of the options vest 36 months from the date of issue of the options provided the offereeremains a director of the company at the vesting date.OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 64
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 14: SHARE BASED PAYMENTS (continued) 2.On 07 November 2022, 19,500,000 options at a price of $0.30 expiring 30 June 2026 were issued as part of thelong-term employee incentive plan. The vesting condition is for the employee to remain in employment with theCompany for six months.3.On 20 July 2022, the following Zero Exercise Price Options were issued:§4,000,000 options expiring 20 July 2025.(a)1,250,000 of these options will vest upon announcement of an updated Mineral Resource estimate ofat least 6 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project;(b)1,250,000 of these options will vest upon Board approval of a health, safety and environmentalmanagement plan prepared in consultation with suitably qualified and independent third partyconsultants;(c)1,500,000 of these options will vest upon continuous service for 12 months.§4,000,000 options expiring 20 July 2026(a)937,500 of these options will vest upon announcement of an Ore Reserve for the Bankan Gold Project ofat least 3 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project;(b)937,500 of these options will vest upon announcement of a positive PFS for the Bankan Gold Project;(c)625,000 of these options will vest upon achievement of the specified health, safety and environmentalmilestones approved by the Board for the period between 1 January 2022 and 31 December 2022;(d)1,500,000 of these options will vest upon continuous service for 24 months.§8,000,000 options expiring 20 July 2027(a)1,875,000 of these options will vest upon announcement of a Positive BFS for the Bankan Project;(b)1,875,000 of these options will vest upon announcement of the issue of an Exploitation Permit bythe Guinea Ministry if Mines and Geology for the Bankan Gold Project;(c)1,250,000 of these options will vest upon achievement of the specified health, safety andenvironmental milestones for the period between 1 January 2023 and 31 December 2023;(d)3,000,000 of these options will vest upon continuous service for 36 months.Option holder Directors Date of Issue 20/07/2022 Number of options 10,000,000 Dividend yield (%) Nil Expected volatility (%) 100% Risk free interest rate (%) 2.89% Exercise price ($) $0.30 Expected life of options (years) 4 Share price at grant date ($) $0.18 Value per option ($) $0.110 Expensed during the financial year $453,167 Option holder Consultant Date of Issue 07/11/2022 Number of options 19,500,000 Dividend yield (%) Nil Expected volatility (%) 100% Risk free interest rate (%) 2.89% Exercise price ($) $0.30 Expected life of options (years) 4 Share price at grant date ($) $0.18 Value per option ($) $0.102 Expensed during the financial year $1,593,197 Annual Report 2023
65
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 14: SHARE BASED PAYMENTS (continued) 4.On 03 November 2022, the following Zero Exercise Price Options were issued:§2,625,000 options expiring 20 July 2025(a)1,312,500 of these options will vest upon announcement of an updated Mineral Resource estimate of atleast 6 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project;(b)1,312,500 on board approval of a health, safety and environmental management plan prepared inconsultation with suitably qualified and independent third party consultants.§2,625,000 options expiring 20 July 2026(a)984,375 of these options will vest upon announcement of an Ore Reserve for the Bankan Gold Project ofat least 3 million ounces of gold at a minimum cut-off grade of 0.5g/t at the Bankan Gold Project;(b)984,375 of these options will vest upon announcement of a positive PFS for the Bankan Gold Project;(c)656,250 of these options will vest upon achievement of the specified health, safety and environmentalmilestones approved by the Board for the period between 1 January 2022 and 31 December 2022.§5,250,000 options expiring 20 July 2027(a)1,968,750 of these options will vest upon announcement of a Positive BFS for the Bankan Project;(b)1,968,750 of these options will vest upon announcement of the issue of an Exploitation Permit by theGuinea Ministry of Mines and Geology for the Bankan Gold Project;(c)1,312,500 of these options will vest upon achievement of the specified health, safety andenvironmental milestones for the period between 1 January 2023 and 31 December 2023.Option holder Expiry 20/07/25 Expiry 20/07/26 Expiry 20/07/27 Date of Grant 18/07/2022 18/07/2022 18/07/2022 Number of options 4,000,000 4,000,000 8,000,000 Dividend yield (%) Nil Nil Nil Expected volatility (%) 90% 90% 90% Risk free interest rate (%) 3.024% 3.024% 3.024% Exercise price ($) $0.00 $0.00 $0.00 Expected life of options (years) 3 4 5 Share price at grant date ($) $0.18 $0.18 $0.18 Value per option ($) $0.18 $0.18 $0.18 Expensed during the financial year $546,016 $272,635 $363,679 Option holder Expiry 20/07/25 Expiry 20/07/26 Expiry 20/07/27 Date of Grant 03/11/2022 03/11/2022 03/11/2022 Number of options 2,625,000 2,625,000 5,250,000 Dividend yield (%) Nil Nil Nil Expected volatility (%) 90% 90% 90% Risk free interest rate (%) 3.397% 3.397% 3.397% Exercise price ($) $0.00 $0.00 $0.00 Expected life of options (years) 3 4 5 Share price at grant date ($) $0.15 $0.15 $0.15 Value per option ($) $0.15 $0.15 $0.15 Expensed during the financial year $207,123 $103,420 $137,956 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 66
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 14: SHARE BASED PAYMENTS (continued) During the year ended 30 June 2022, the Group granted the following options as share-based payment: §8,000,000 unlisted options exercisable at $0.14 expiring in 3 years to the brokers§2,500,000 unlisted options exercisable at $0.2910 expiring in 3 years as part of the long-term employee incentiveplan§3,000,000 unlisted options exercisable at $0.34 expiring in 3 years as part of the long-term employee incentiveplanFor the options granted, the valuation model inputs used in the Black-Scholes Model were as follows: 2022: Grant date Expiry date Share price at grant date Exercise price Expected volatility Dividend yield Risk-free interest rate Fair value Expensed during the Financial year 2023 09 July 2021 28 July 2024 $0.100 $0.140 100% -0.40%$0.055 - 05 Nov 2021 08 Nov 2024 $0.220 $0.291 100% -0.40%$0.123 - 10 May 2022 03 Jan 2025 $0.243 $0.340 100% -1.15%$0.134 203,655 The total share-based payment expensed during the year is $3,880,848. At 30 June 2023, the Group has the following share-based payment options on issue: Grant Date Expiry Date Exercise price Start of the year Granted during the year Exercised during the year Expired during the year Balance at the end of the year Vested and exercisable at the end of the year 24 Dec 2019 24 Dec 2022 $0.0180 75,856,884 -(74,531,461) (1,325,423)- - 30 Jun 2020 30 Jun 2023 $0.1800 7,500,000 - (7,500,000) - - 09 Nov 2020 05 May 2023 $0.0986 9,400,000 -(9,400,000)- - - 09 Nov 2020 19 Dec 2022 $0.011 2,500,000 -(2,500,000)- - - 11 Dec 2020 21 Dec 2023 $0.112 8,000,000 -- 8,000,000 8,000,000 05 Feb 2021 05 May 2023 $0.0986 20,195,741 -(20,195,741)- - - 14 May 2021 26 May 2024 $0.0986 3,500,000 - - - 3,500,000 3,500,000 28 Jul 2021 28 Jul 2024 $0.1400 8,000,000 - - - 8,000,000 8,000,000 05 Nov 2021 05 Nov 2024 $0.2910 2,500,000 - - - 2,500,000 2,500,000 26 May 2022 03 Jan 2025 $0.3400 3,000,000 - - - 3,000,000 3,000,000 07 Jul 2022 30 Jun 2026 $0.3000 -10,000,000 - - 10,000,000 - 07 Jul 2022 20 Jul 2025 - - 4,000,000 - - 4,000,000 - 07 Jul 2022 20 July 2026 - - 4,000,000 - - 4,000,000 - 07 Jul 2022 20 July 2027 - - 8,000,000 - - 8,000,000 - 07 Nov 2022 20 Nov 2025 - - 2,625,000 - - 2,625,000 - 07 Nov 2022 20 Nov 2026 - - 2,625,000 - - 2,625,000 - 07 Nov 2022 20 Nov 2027 - - 5,250,000 - - 5,250,000 - 07 Nov 2022 30 Jun 2026 $0.3000 -19,500,000 - - 19,500,000 19,500,000 140,452,625 56,000,000 (106,627,202) (8,825,423) 81,000,000 44,500,000 Annual Report 2023
67
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 14: SHARE BASED PAYMENTS (continued) At 30 June 2022, the Group has the following share-based payment options on issue: Grant Date Expiry Date Exercise price Start of the year Granted during the year Exercised during the year Expired during the year Balance at the end of the year Vested and exercisable at the end of the year 24 Dec 2019 24 Dec 2022 $0.0180 84,431,485 -(8,774,601)-75,856,884 75,856,884 30 Jun 2020 30 Jun 2023 $0.1800 7,500,000 --- 7,500,000 7,500,000 09 Nov 2020 05 May 2023 $0.0986 15,500,000 -(6,100,000)-9,400,0009,400,000 09 Nov 2020 19 Dec 2022 $0.011 2,500,000 - - - 2,500,000 2,500,000 11 Dec 2020 21 Dec 2023 $0.112 8,000,000 - - - 8,000,000 8,000,000 05 Feb 2021 05 May 2023 $0.0986 25,000,000 -(4,804,259)-20,195,741 20,195,741 14 May 2021 26 May 2024 $0.0986 10,500,000 - - (7,000,000) 3,500,000 3,500,000 28 Jul 2021 28 Jul 2024 $0.1400 -8,000,000 - - 8,000,000 8,000,000 05 Nov 2021 05 Nov 2024 $0.2910 -2,500,000 - - 2,500,000 2,500,000 26 May 2022 03 Jan 2025 $0.3400 -3,000,000 - - 3,000,000 - 153,631,485 13,500,000 (19,678,860) (7,000,000) 140,452,625 137,452,625 The weighted average exercise price of options as at 30 June 2023 was $0.1229 (30 June 2022: $0.1498). The weighted average remaining contractual life of options outstanding at year end was 1.01 years (30 June 2022: 0.79 years). NOTE 15: OPERATING SEGMENTS Identification of Reportable Segments The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources. The accounting policies applied for internal purposes are consistent with those applied in the preparation of these financial statements. The following is an analysis of the Group’s revenue and results from operations by reportable segment. 2023 Corporate Gold Burk. Faso Gold Cote D’Ivoire Gold Guinea Total $ $ $ $ $ Revenue Interest income 632,838 - - - 632,838 Expenses Administration expenses (1,642,800) -(143,073)-(1,785,873)Employee benefits expense (352,262) --- (352,262) Depreciation of fixed asset (3,005) (376,966) (379,971) Share based expense (3,880,848) - - - (3,880,848) FX gain / (loss) (440,772) - - (65,492) (506,264) Exploration expenditure expensed (2,241,468) - - (710,351) (2,951,819) Depreciation – Rights of Use Asset - - - (144,085) (144,085) Provision for doubtful debts - - - (2,521,633) (2,521,633) Movement in provision - - - 950,527 950,527 Cost to dispose of subsidiaries (285,406) - - - (285,406) Loss on disposal of fixed asset - - - (6,528) (6,528) Loss before tax (8,213,723) -(143,073)(2,874,527) (11,231,323) Current assets 44,351,625 - - 1,043,918 45,395,543 Exploration expenditure - - - 87,201,892 87,201,892 Plant and Equipment 1,210 - - 877,482 878,692 Right of Use Asset - - - 312,188 312,188 Intercompany loans 90,717,226 - - (90,717,226) - Current liabilities (493,288) - - (4,451,801) (4,945,089) Net assets/(liabilities) 134,576,773 - - (5,733,547) 128,843,226 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 68
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 15: OPERATING SEGMENTS (Continued) The following is an analysis of the Group’s revenue and results from operations by reportable segment. 2022 Corporate Gold Burk. Faso Gold Cote D’Ivoire Gold Guinea Total $ $ $ $ $ Revenue Interest income 3,113 - - - 3,113 Expenses Administration expenses (979,536) (269,057) 9,009 (304,581) (1,544,165) Employee benefits expense (309,962) - - - (309,962) Depreciation of fixed asset (4,993) (216,754) (221,747) Share based expense (731,130) - - - (731,130) FX gain / (loss) 695,644 - - (381,999) 313,645 Exploration expenditure expensed - - - (2,584,362) (2,584,362) Impairment of Exploration -(239,289) -(1,772,074)(2,011,363) Provision for doubtful debts --- (918,837) (918,837) Movement in provision --- (1,682,894) (1,682,894) Loss before tax (1,326,864) (508,346) 9,009 (7,861,501) (9,687,702) Current assets 41,151,709 36,657 46,013 1,205,312 42,439,691 Exploration expenditure - - - 37,376,965 37,376,965 Plant and Equipment 4,215 - - 807,311 811,526 Intercompany loans 38,590,184 (673,285) (165,630) (37,751,269) - Current liabilities (981,798) (4,114) (29,587) (5,532,963) (6,548,463) Net assets/(liabilities) 78,764,310 (401,453) (149,204) (3,894,644) 74,079,719 NOTE 16: CAPITAL AND LEASING COMMITMENTS 2023 $ 2022 $ (A)CAPITAL EXPENDITURE COMMITMENTS(i)Payable:-not later than 12 months3,074,965 3,709,456 -not later than 12 months and 5 years12,299,861 14,837,823 -more than 5 years- - 15,374,827 18,547,279 (i)Capital expenditure commitments are expenditure commitments on exploration permits in Guinea.NOTE 17: CONTINGENT ASSETS/LIABILITIES Contingent Assets According to Guinean tax law, value added tax (VAT) paid in relation to the Company’s Guinea tenements may be recovered from the Guinea tax authorities if these tenements progress to the development phase. No asset has been recognised in the Consolidated Statement of Financial Position as there is currently no certainty that these tenements will reach the development phase or that the total VAT will be fully recovered in this event. However, a contingent asset exists of $3,643,956 at 30 June 2023 (2022: $1,081,641) relating to total VAT paid to date. A total of $2,521,633 of VAT was paid to the Guinea tax authorities during the year which was expensed in the Statement of Comprehensive Income and foreign exchange of $40,682 relating to the VAT was expensed in the Statement of Comprehensive Income. Contingent Liabilities There is no contingent liabilities as at 30 June 2023. Annual Report 2023
69
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 18: INTERESTS OF KEY MANAGEMENT PERSONNEL Refer to the Remuneration Report contained in the Directors' Report for details of the remuneration paid or payable to each member of the Group's key management personnel for the year ended 30 June 2023. The totals of remuneration paid to key management personnel of the company and the Group during the year are as follows: Consolidated 2023 $ 2022 $ Short-term benefits 1,369,516 754,840 Share based payments 2,901,020 271,870 Post-employments benefits - 31,206 4,270,536 1,057,916 NOTE 19: RELATED PARTY TRANSACTIONS Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. Transactions with related parties comprised the following: Intercompany Loans PDI Discovery Limited has made loans to its subsidiaries in the amount of $90,717,226 (2022: $38,590,184). The loan is interest free and payable on demand. Directors’ Remuneration Refer to Note 18. Other Related Party Transactions There was no related party transactions during the year ended 30 June 2023. NOTE 20: REMUNERATION OF AUDITORS Consolidated 2023 $ 2022 $ Remuneration of the auditor of the parent entity for: PKF Perth -Audit services 68,585 58,525 68,585 58,525 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 70
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 21: FINANCIAL RISK MANAGEMENT The Group's financial instruments consist mainly of deposits with banks, receivables and payables. The totals for each category of financial instruments, measured in accordance with AASB 9 as detailed in the accounting policies to these financial statements, are as follows: Note Consolidated 2023 $ 2022 $ Financial Assets Cash and cash equivalents 6(a) 44,894,558 42,035,541 Trade and other receivables 7 500,985 404,150 Total Financial Assets 45,395,543 42,439,691 Financial Liabilities Trade and other payables 10 4,631,848 6,548,463 Right of use liabilities 313,241 - Total Financial Liabilities 4,945,089 6,548,463 FINANCIAL RISK MANAGEMENT POLICIES Exposure to key financial risks is managed in accordance with the Group’s risk management policy with the objective to ensure that the financial risks inherent in exploration activities are identified and then managed or kept as low as reasonably practicable. The main financial risks that arise in the normal course of business are market risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. Different methods are used to measure and manage these risk exposures. Liquidity risk is monitored through the ongoing review of available cash and future commitments for exploration expenditure. Exposure to liquidity risk is limited by anticipating liquidity shortages and ensures capital can be raise in advance of shortages. Interest rate risk is managed by limiting the amount of interest-bearing loans entered into by the Group. It is the Board's policy that no speculative trading in financial instruments be undertaken so as to limit expose to price risk. Primary responsibility for identification and control of financial risks rests with the Chief Financial Officer, under the authority of the Board. The Board is apprised of these risks from time to time and agrees any policies that may be undertaken to manage any of the risks identified. Details of the significant accounting policies and methods adopted, including criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each financial instrument are disclosed in Note 1 to the financial statements. The carrying values less the impairment allowance for receivables and payables are assumed to approximate fair values due to their short-term nature. Cash and cash equivalents are subject to variable interest rates. Annual Report 2023
71
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 21: FINANCIAL RISK MANAGEMENT (Continued) SPECIFIC FINANCIAL RISK EXPOSURES AND MANAGEMENT (A)CREDIT RISKExposure to credit risk relating to financial assets arises from the potential non-performance by counter parties of contract obligations that could lead to a financial loss to the Group. The Group trades only with recognised, creditworthy third parties. The Group has no customers and consequently no significant exposure to bad debts or other credit risks. With respect to credit risk arising from financial assets, which comprise cash and cash equivalents and receivables, the exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. At balance date cash and deposits were held with Australia and New Zealand Banking Group Limited. (B)LIQUIDITY RISKLiquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. Prudent liquidity risk management implies maintaining sufficient cash reserves to meet the ongoing operational requirements of the business. It is the Group’s policy to maintain sufficient funds in cash and cash equivalents. Furthermore, the Group monitors its ongoing exploration cash requirements and raises equity funding as and when appropriate to meet such planned requirements. The Group has no undrawn financing facilities. Trade and other payables, the only financial liability of the Group, are due within 6 months. The tables below reflect an undiscounted contractual maturity analysis for financial liabilities. Cash flows realised from financial assets reflect management's expectation as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities reflects the earliest contractual settlement dates and does not reflect management's expectations that banking facilities will be rolled forward. Financial liability and financial asset maturity analysis Within 1 Year 1 to 5 Years Total Contractual Cash Flow 2023 $ 2022 $ 2023 $ 2022 $ 2023 $ 2022 $ Financial liabilities due for payment Trade and other payables 4,631,848 6,548,463 -- 4,631,8486,548,463 Rights of use liabilities 313,241 - 313,241- Total contractual outflows 4,945,089 6,548,463 -- 4,945,0896,548,463 Financial assets - cash flows realisable Trade and other receivables 500,985 404,150 -- 500,985404,150 Total anticipated inflows 500,985 404,150 -- 500,985404,150 The financial assets and liabilities noted above are interest free. OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 72
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 21: FINANCIAL RISK MANAGEMENT (Continued) (C)MARKET RISKi.Foreign exchange riskExposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument fluctuating dueto movement in foreign exchange rates of currencies in which the Group holds foreign currency which are other than theAUD functional currency of the Group.ii.Interest rate riskThe Group’s cash flow interest rate risk primarily arises from cash at bank and deposits subject to market bank rates. Atbalance date, the Group does not have any borrowings. The Group does not enter into hedges. The weighted average rateof interest earned by the Group on its cash assets during the year was 1.82% (2022: 0.02%). The table below summarisesthe sensitivity of the Group’s cash assets to interest rate risk.Financial Assets Effect of decrease or increase of interest rate on profit and equity -1%+1%Profit Equity Profit Equity $ $ $ $ 30 June 2023 Total increase/(decrease) (276,948) (276,948) 592,045 592,045 30 June 2022 Total increase/(decrease) (193,187) (193,187) 193,187 197,187 NOTE 22: EVENTS AFTER THE END OF THE REPORTING PERIOD The following events have occurred subsequent to the year ended 30 June 2023: (i)A General Meeting of shareholders was held on 27 July 2023 to (a) ratify the placement of 269.6m shares at an issueprice of $0.15 per share (raising $40.4m before costs) completed in June 2023; and (b) approve the issue of up 1.0mshares to directors (and/or their nominees) at an issue price of $0.15 per share. All resolutions put the meeting werecarried following a poll;(ii)Additional resource definition drilling results for NEB and BC were announced on 7 August 2023;(iii)A Mineral Resource update was announced on 7 August 2023, increasing the overall Bankan Project Mineral Resourceestimate to 5.38Moz (including 4.14Moz Indicated)3 and(iv)Encouraging results from the initial RC drilling program at Argo were announced on 29 August 2023.There has not been any other matter or circumstance arising after the balance date that has significantly affected or could significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years. 3 ASX announcement – Bankan Mineral Resource Increases to 5.38Moz (7 August 2023). Annual Report 2023
73
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 23: CONTROLLED ENTITIES Country of Incorporation Percentage Owned(i) 2023 2022 Parent Entity: Predictive Discovery Limited Australia - - Subsidiaries of legal parent entity: Predictive Discovery Cote D’Ivoire Pty Ltd Australia 100% 100% Ivoirian Resources Pty Ltd Australia 20% 100% Gayeri Resources Pty Ltd Australia -100%Predictive Discovery Mali Resources Pty Ltd Australia -100%Bougouni Resources Pty Ltd Australia 100% 100%Kenieba Resources Pty Ltd Australia 100% 100%Kita Resources Pty Ltd Australia 100% 100%Burkina Resources Pty Ltd(ii)Australia -100%Tinkisso Pty Ltd Australia 100% 100%Manoko Resources Pty Ltd Australia 100% 100%Predictive Discovery SARL (ii) Cote D’Ivoire 100% 100%Ivoirian Resources SARL Cote D’Ivoire 20% 100%Predictive Discovery Niger SARL Niger -100%Gayeri Resources SARL Burkina Faso -100%Burkina Resources SARL(ii) Burkina Faso -100%Birrimian BV SARL(ii) Burkina Faso -100%Sebba Resources SARL(ii) Burkina Faso -100%Progress Minerals SARL(ii) Burkina Faso -100%Predictive Discovery Mali SARL Mali 100% 100%Kindia Resources SARLU Guinea 100% 100%Mamou Resources SARLU Guinea 100% 100%Tinkisso Resources SARLU Guinea 100% 100%Birrimian Pty Ltd(ii) British Virgin Islands -100%PMI Burkina Faso (BVI) Inc(ii) British Virgin Islands -100%BF Progress (BVI) Inc(ii) British Virgin Islands -100%(i)Percentage of voting power is in proportion to ownership (ii)Disposed – Refer to note 3OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 74
Predictive Discovery Limited
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 24: PARENT ENTITY DISCLOSURES 2023 $ 2022 $ Assets Current assets 44,351,625 41,151,709 Non-current assets 90,718,436 38,595,794 Total assets 135,070,061 79,747,503 Liabilities Current liabilities (493,289) (981,799) Total liabilities (493,289) (981,799) Equity Issued capital 175,912,717 114,396,488 Reserves 5,175,541 2,383,400 Prior year accumulated losses (37,329,485) (34,791,872) Current year losses (9,182,000) (3,222,312) Total equity 134,576,773 78,765,704 CONTINGENT LIABILITIES Nil CONTRACTUAL COMMITMENTS The parent entity has commitments as at 30 June 2023 that are disclosed in Note 16. RECOVERABILITY OF INTERCOMPANY LOAN Within Non-current assets is a loan due from the 100% subsidiaries of $90,717,226 which is considered fully recoverable. The recoverability of this loan is dependent upon the successful development or sale of exploration assets in Guinea. NOTE 25: COMPANY DETAILS The registered office of the company is: The principal place of business of the company is: Suite 8, 110 Hay Street, SUBIACO WA 6000 Suite 8, 110 Hay Street, SUBIACO WA 6000 Annual Report 2023
75
DIRECTOR’S DECLARATION FOR THE YEAR ENDED 30 JUNE 2023 DIRECTORS’ DECLARATION The directors of the company declare that: 1.The financial statements and notes, as set out on pages 44 to 74, are in accordance with the Corporations Act 2001 and:(a)comply with Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and(b)give a true and fair view of the financial position as at 30 June 2023 and of the performance for the year ended on that date of the consolidated group;2.The Chief Executive Officer and Chief Financial Officer have each declared that:(a)the financial records of the company for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001;(b)the financial statements and notes for the financial year comply with the Accounting Standards; and(c)the financial statements and notes for the financial year give a true and fair view.Note 1 confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board. 3.In the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.This declaration is made in accordance with a resolution of the Board of Directors. Andrew Pardey Managing Director 18 September 2023 OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 76
Predictive Discovery Limited
PKF PerthLevel 4, 35 Havelock Street, West Perth, WA 6005PO Box 609, West Perth, WA 6872T: +61 8 9426 8999 F: +61 8 9426 8900 www.pkfperth.com.auPKF Perth is a member firm of the PKF International Limited family of legally independent firms and does not accept any responsibility or liability for the actions orinactions of any individual member or correspondent firm or firms.Liability limited by a scheme approved under Professional Standards Legislation.INDEPENDENT AUDITOR’S REPORTTO THE MEMBERS OF PREDICTIVE DISCOVERYLIMITEDReport on the Financial ReportOpinionWe have audited the accompanying financial report of Predictive DiscoveryLimited (the company),which comprisesthe consolidated statement of financial position as at 30 June 2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes comprisinga summary of significant accounting policies and other explanatory information, and the directors’ declaration of the company and the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year.In our opinion the accompanying financial report of Predictive Discovery Limited is in accordance with the Corporations Act 2001, including:i)Giving a true and fair view of the consolidated entity’s financial position as at 30 June 2023and of itsperformance for the year ended on that date; andii)Complying with Australian Accounting Standards and the Corporations Regulations 2001.Basis for OpinionWe conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Reportsection of our report.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ouropinion. IndependenceWe are independent of the consolidated entity in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants(including Independence Standards)(the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. Annual Report 2023
77
PKF PerthKey AuditMattersA key audit matter is a matterthat, in our professional judgement, wasof most significance in our audit of the financial report of the current year. These matterswere addressed in the context of our audit of the financial reportas a whole, and in forming our opinion thereon, and we do not provide a separate audit opinion on these matters.For the mattersbelow, our description of how our audit addressed these matters areprovided in that context.1.Valuationofcapitalised exploration expenditureWhy significantHow our audit addressed the key audit matterAs at 30 June 2023the carrying value of exploration and evaluation assets was $87,201,892(2022:$37,376,965), as disclosed in Note 9.This represents 65.2% of total assets of the consolidated entity..The consolidated entity’s accounting policy in respect of exploration and evaluation expenditure is outlined in Note1(j)with the nature of critical estimates and judgements relating to this balance outlined in Note 1(r). Significant judgementis required:•in determining whether facts and circumstancesindicate that the exploration andevaluation assetsshould be tested for impairment in accordancewith Australian Accounting Standard AASB 6Exploration for and Evaluation of MineralResources (“AASB 6”); and•in determining the treatment of exploration andevaluation expenditure in accordance with AASB6, and the consolidated entity’s accounting policy.In particular:owhether the particular areas of interest meetthe recognition conditions for anasset; andowhich elements of exploration and evaluationexpenditures qualify for capitalisation for eacharea of interest.Our work included, but was not limited to, the following procedures:•conducting a detailed review of management’sassessment ofimpairment trigger events prepared inaccordance with AASB 6 including:oassessing whether the rights to tenure of theareas of interest remained current at reportingdate as well as confirming that rights to tenureare expected to be renewed for tenementsthatwill expire in the near future;oobtaining specific representations with thedirectors andmanagement as to the status ofongoing exploration programmes for the areasof interest, as well as assessing if there wasevidence that a decision had been made todiscontinue activities in any specific areas ofinterest; andoobtaining and assessing evidence of theconsolidated entity’s future intention for theareas of interest, including reviewing futurebudgeted expenditure and related workprogrammes.•considering whether exploration activities for theareas of interest had reached a stage where areasonable assessment of economically recoverablereserves existed;•testing, on a sample basis, exploration andevaluation expenditure incurred during the year forcompliance with AASB 6 and the consolidatedentity’s accounting policy; and•reviewing the impairment calculations provided andrelated assumptions and disclosures in Notes 1(j),1(r) and 9for accuracy andcompleteness.OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 78
Predictive Discovery Limited
PKF Perth 2.Share Based PaymentsWhy significantHow our audit addressed the key audit matterFor the year ended 30 June 2023,the value of share based payments issued totalled $3,880,848as disclosed in Note 14. This has been recognised as a share-based payment expense of $3,880,848in the Statement of Profit or Loss and Other Comprehensive Income.The consolidated entity’s accounting judgement and estimates in respect of share-based payments is outlined in Note 1(q)and (r).Significant judgementis required in relation to:•The valuation method used in the model; and•The assumptions and inputs used within the model.Our work included, but was not limited to, the following procedures: •Reviewed the company’s valuations of the equityinstrumentsissued, including:oassessing the appropriateness of the valuationmethod used; andoassessing the reasonableness of theassumptions and inputs used within thevaluation model.•Reviewed Board meeting minutes and ASXannouncements as well as enquired of relevantpersonnel to ensure all share-based paymentshad been recognised;•Assessed the allocation and recognition to ensurethese arereasonable; and•Assessed the appropriateness of the relateddisclosures inNotes 1(q), 1(r)and 14.Other InformationThose charged with governance are responsible for the other information. The other information comprises the information included in the consolidated entity’s annual report for the year ended 30 June 2023,but does not include the financial reportandour auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon, with the exception of the Remuneration Report.In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to bematerially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.Responsibilities of Directors’ for the Financial ReportThe Directors of the company are responsible for the preparation of the financial reportthat gives a true and fair view in accordance withAustralian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors determine is necessary to enable the preparation of the financial reportthat gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the Directors are responsible for assessing the consolidated entity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the goingconcern basis of accounting unless the Directors either intend to liquidate the consolidatedentity or to cease operations, or have no realistic alternative but to do so. Annual Report 2023
79
PKF Perth Auditor’s Responsibilities for the Audit of the Financial ReportOur objectives are to obtain reasonable assurance about whether the financial report as a whole is free frommaterial misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users takenon the basis of this financial report.As part of an audit in accordance with Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:•Identify and assessthe risks of materialmisstatement of the financial report, whether due to fraud or error,design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficientand appropriate to provide a basis forouropinion. The risk of not detecting a material misstatement resultingfrom fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentionalomissions, misrepresentations, or the override of internal control.•Obtain an understanding of internal control relevant to the auditin order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of theconsolidated entity’s internal control.•Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimatesand related disclosures made by the Directors.Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and,basedon the audit evidence obtained, whethera material uncertainty exists related to events or conditions that maycast significant doubt on the consolidated entity’s ability to continue as a going concern. If we conclude thatamaterial uncertainty exists, we are required to draw attentionin our auditor’s report to the related disclosuresin the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions arebased on the audit evidence obtained up to the date of our auditor’s report. However, future events orconditions may cause the consolidated entity to cease to continue as a going concern.•Evaluate the overall presentation, structure and content of the financial report, including the disclosures, andwhether the financial report represents the underlying transactions and events in a manner that achieves fairpresentation.•Obtain sufficient appropriate audit evidence regarding the financial information of the entities or businessactivities within the consolidatedentity to express an opinion on the group financial report. Weareresponsible for the direction, supervision and performance of the group audit. We remain solely responsiblefor our audit opinion.We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the Directors with a statement that we have complied with relevant ethical requirements regardingindependence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 80
Predictive Discovery Limited
PKF Perth From the matters communicated withthe Directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.Report on the Remuneration ReportOpinionWe have audited the Remuneration Report included in theDirectors’ Report for the year ended 30 June 2023.In our opinion, the RemunerationReport of PredictiveDiscoveryLimited for the year ended 30 June 2023complies with section 300A of the Corporations Act 2001. ResponsibilitiesThe directors of the Company are responsible for the preparation and presentation of the Remuneration Reportin accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.PKFPERTHSHANE CROSSAUDIT PARTNER 18SEPTEMBER2023WEST PERTHWESTERN AUSTRALIA Annual Report 2023
81
Level 4,35 Havelock Street, West Perth, WA 6005PO Box 609, West Perth, WA 6872T: +61 8 9426 8999 F: +61 8 9426 8900 www.pkfperth.com.auPKF Perth is a member firm of the PKF International Limited family of legally independent firms and does not accept any responsibility or liability for the actions or inactions of any individual member or correspondent firm or firms.Liability limited by a scheme approved under Professional Standards Legislation.PKF PerthAUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF PREDICTIVE DISCOVERYLIMITEDIn relation to our audit of the financial report of Predictive DiscoveryLimitedfor the year ended 30 June 2023, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.PKFPERTHSHANE CROSSAUDIT PARTNER18SEPTEMBER2023WEST PERTHWESTERN AUSTRALIAOVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSADDITIONAL INFORMATION 82
Predictive Discovery Limited
Additional
Information
Annual Report 2023
83
Shareholders Information
Mineral Tenement Information
Corporate Directory
84
89
90
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
84
Predictive Discovery Limited
Shareholders Information
(as at 22 September 2023)
Number and class of all securities on issue
ASX code
Number
Description
PDI
2,068,244,088
Fully paid ordinary shares
PDIAP
8,000,000
Unlisted options exercisable @ $0.112 and expiring on 21-Dec-23
PDIAQ
3,500,000
Unlisted options exercisable @ $0.0986 and expiring on 26-May-24
PDIAR
8,000,000
Unlisted options exercisable @ $0.14 and expiring on 28-Jul-24
PDIAS
2,500,000
Unlisted options exercisable @ $0.291 and expiring on 5-Nov-24
PDIAT
3,000,000
Unlisted options exercisable @ $0.34 and expiring on 3-Jan-25
PDIAU
29,500,000
Unlisted options exercisable @ $0.30 and expiring on 30-Jun-26
PDIAV
6,625,000
Unlisted zero exercise price options expiring on 20-Jul-25
PDIAW 13,250,000
Unlisted zero exercise price options expiring on 20-Jul-27
PDIAX
6,625,000
Unlisted zero exercise price options expiring on 20-Jul-26
Distribution of securities
PDI (fully paid ordinary shares)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
176
394
536
1,454
742
52,144
1,368,548
4,300,599
59,205,141
2,003,317,656
3,302
2,068,244,088
0.00
0.07
0.21
2.86
96.86
100.00
There are 244 shareholders holding less than a marketable parcel of shares in the Company at $0.215 per share.
Annual Report 2023
85
-
-
-
-
100
100
-
-
-
-
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
PDIAP (unlisted options exercisable @ $0.112 and expiring on 21-Dec-23)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
2
2
-
-
-
-
8,000,000
8,000,000
PDIAQ (unlisted options exercisable @ $0.0986 and expiring on 26-May-24)
Number of holders
Number of shares
Percentage
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
-
-
-
-
-
-
-
-
1
1
3,500,000
3,500,000
100.00%
100.00%
PDIAR (unlisted options exercisable @ $0.14 and expiring on 28-Jul-24)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
2
2
-
-
-
-
-
-
-
-
8,000,000
8,000,000
100.00%
100.00%
PDIAS (unlisted options exercisable @ $0.291 and expiring on 5-Nov-24)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
1
1
-
-
-
-
-
-
-
-
2,500,000
2,500,000
100.00%
100.00%
PDIAT (unlisted options exercisable @ $0.34 and expiring on 3-Jan-25)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
1
1
-
-
-
-
-
-
-
-
3,000,000
3,000,000
100.00%
100.00%
86
Predictive Discovery Limited
Shareholders Information
(as at 22 September 2023)
PDIAU (unlisted options exercisable @ $0.30 and expiring on 30-Jun-26)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
13
13
-
-
-
-
-
-
-
-
29,500,000
29,500,000
100.00%
100.00%
PDIAV (unlisted zero exercise price options expiring on 20-Jul-25)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
7
7
-
-
-
-
-
-
-
-
6,625,000
6,625,000
100.00
100.00
PDIAW (unlisted zero exercise price options expiring on 20-Jul-27)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
7
7
-
-
-
-
-
-
-
-
13,250,000
13,250,000
100.00
100.00
PDIAX (unlisted zero exercise price options expiring on 20-Jul-26)
Range
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001 and over
Total
Number of holders
Number of shares
Percentage
-
-
-
-
7
7
-
-
-
-
-
-
-
-
6,625,000
6,625,000
100.00
100.00
Annual Report 2023
87
Substantial shareholders (PDI)
PDI’s substantial shareholders as disclosed in notices lodged with the ASX are set out in the table below.
These shareholders have not been required to lodge new substantial shareholder notices since the date of
their last notices because their percentage of issued capital held has not changed by more than 1%.
Shareholder
BlackRock Group
Capital Di Limited
Phillip Richard Perry
Twenty largest shareholders
Date of notice
Shares held
Percentage
of issued
capital
27 June 2023
19 July 2021
23 December 2022
259,919,454
141,000,000
108,644,200
12.57
10.44
6.09
Rank
Shareholder
Shares held
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
Capital Di Limited
Mr Phillip Richard Perry
Citicorp Nominees Pty Limited
Mr Jamie Phillip Boyton
Mr Pasquale Bevilacqua + Mrs Maria Carmela Bevilacqua
HSBC Custody Nominees (Australia) Limited
Aigle Royal Superannuation Pty Ltd
BNP Paribas Noms Pty Ltd
BNP Paribas Nominees Pty Ltd
Mr Phillip Richard Perry + Mrs Tetyana Perry
BPM Investments Limited
Orimco Resource Investments Pty Ltd
Dyspo Pty Limited
Aigle Royal Superannuation Pty Ltd
El-Raghy Kriewaldt Pty Ltd
Equity Trustees Limited
UBS Nominees Pty Ltd
20
Micjud Pty Ltd
Total
Percentage
of issued
capital
26.35
10.38
9.67
4.07
4.05
2.95
2.39
2.38
1.83
1.75
1.64%
1.23%
544,880,920
214,618,918
200,000,000
84,090,501
83,667,364
61,000,000
49,425,000
49,289,452
37,866,667
36,126,963
33,908,806
25,417,358
20,000,000
0.97%
16,765,023
15,400,000
14,966,667
0.81%
0.74%
0.72%
13,000,000
0.63%
12,709,154
0.61%
11,120,973
0.54%
10,226,203
0.49%
1,534,479,969
74.19%
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
88
Predictive Discovery Limited
Shareholders Information
(as at 22 September 2023)
Unlisted equity securities
ASX code
Number
Holders
Description
Holders of more than 20%
PDIAP
8,000,000
PDIAQ
3,500,000
PDIAR
8,000,000
PDIAS
2,500,000
PDIAT
3,000,000
2
1
2
1
1
Unlisted options exercisable @
$0.112 and expiring on 21-Dec-23
Unlisted options exercisable @
$0.0986 and expiring on 26-May-24
Unlisted options exercisable @
$0.14 and expiring on 28-Jul-24
Unlisted options exercisable @
$0.291 and expiring on 5-Nov-24
Unlisted options exercisable @
$0.34 and expiring on 3-Jan-25
HSBC Custody Nominess
(Australia) Limited (4,000,000 / 50.0%)
Zenix Nominees Pty Ltd
(4,000,000 / 50.0%)
Andrew Pardey (3,500,000 / 100.00%)
HSBC Custody Nominess (Australia)
Limited (4,000,000 / 50.0%)
Zenix Nominees Pty Ltd
(4,000,000 / 50.0%)
Philippe Blackburn (2,500,000 / 100.0%)
Norman Bailie (3,000,000 / 100.0%)
PDIAU
29,500,000
13
Unlisted options exercisable @
$0.30 and expiring on 30-Jun-26
None
PDIAV
6,625,000
PDIAW 13,250,000
PDIAX
6,625,000
7
7
7
Unlisted zero exercise price
options expiring on 20-Jul-25
Unlisted zero exercise price
options expiring on 20-Jul-27
Unlisted zero exercise price
options expiring on 20-Jul-26
Andrew Pardey (2,500,000 / 37.74%)
Pierre Louw (1,875,000 / 28.30%)
Andrew Pardey (5,000,000 / 37.74%)
Pierre Louw (3,750,000 / 28.30%)
Andrew Pardey (2,500,000 / 37.74%)
Pierre Louw (1,875,000 / 28.30%)
Voting rights
Subject to any rights or restrictions for the time being attached to any class or classes of shares, at a general meeting
every shareholder or class of shareholder present in person or by proxy, attorney or representative has one vote
on a show of hands and, on a poll, one vote for each fully paid share which that member holds or represents.
Corporate governance statement
The 2023 Corporate Governance statement of Predictive Discovery Limited is available on the Company’s
website at https://www.predictivediscovery.com/information-for-investors/#corporate-governance
Annual Report 2023
89
Mineral Tenement Information
Name
Number
Kaninko (Bankan)
Saman (Bankan)
Bokoro (Bankan)
Argo (Bankan)
Exploration Permit
Arrete A/2019/5784/MMG
Exploration Permit
Arrete A/2020/1835/MMG
Exploration Permit
Arrete A/2020/2561/MMG
Exploration Permit
Arrete A/2018/7628/MMG
Koundian 1
Koundian 2
Koundian 3
Koundian 4
Nonta
Paramangui 1
Paramangui 2
Exploration Permit
Arrete A/2017/3598/MMG
Exploration Permit
Arrete A/2019/3189/MMG
Exploration Permit
Arrete A/2020/1051/MMG
Exploration Permit
Arrete A/2020/1052/MMG
Exploration Permit
Arrete A/2019/1161/MMG
Exploration Permit
Arrete A/2020/1836/MMG
Exploration Permit
Arrete A/2020/1837/MMG
Location
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Guinea
Area
(sq. km)
98
PDI equity
100%
100%
100%
Right to earn 90% during
the exploration phase and
acquire the remaining 10%
on a decision to mine
Right to earn 90% during
the exploration phase and
acquire the remaining 10%
on a decision to mine
100
100
58
85
100
63
55
Guinea
100
100%
Guinea
Guinea
99
98
Right to earn 80% during
the exploration phase
Boundiali
Mining exploration permit No. 414
Cote D’Ivoire
299
11% (Turaco Gold Ltd 89%)
Boundiali North
Mining exploration permit No. 808
Cote D’Ivoire
350
Beriaboukro
(Toumodi)
Ferkessedougou
North
Mining exploration permit No. 464
Cote D’Ivoire
400
Mining exploration permit No. 367
Cote D’Ivoire
400
Odienne South
Mining exploration permit No. 865
Cote D’Ivoire
367
Odienne North
Mining exploration permit No. 866
Cote D’Ivoire
391
Turaco-Predictive JV holds 35%
and can earn 85%. PDI holds 11%
of the JV (Turaco Gold Ltd 89%)
Turaco-Predictive JV holds 51%
and can earn 85%. PDI holds 11%
of the JV (Turaco Gold Ltd 89%)
Bocanda North
Mining exploration permit No. 844
Cote D’Ivoire
368
20% (Wia Gold Ltd 80%)
Issia
Wendene
Dabakala
Mining exploration permit No. 880
Cote D’Ivoire
400
Mining exploration permit No. 572
Cote D’Ivoire
400
Mining exploration permit application Cote D’Ivoire
400
Rights to bonus payments
on production
Cape Clear
EL 5434
Victoria,
Australia
63
12.5%, reducing to 5%
O
V
E
R
V
I
E
W
I
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
F
I
N
A
N
C
A
L
S
T
A
T
E
M
E
N
T
S
I
I
A
D
D
T
O
N
A
L
I
N
F
O
R
M
A
T
O
N
I
90
Predictive Discovery Limited
Corporate Directory
Directors
Mr Simon Jackson
Non-Executive Chairman
Mr Andrew Pardey
Managing Director
Mr Steven Michael
Non-Executive Director
Ms Sandra Bates
Non-Executive Director
Company Secretary
Mr Ian Hobson
Registered Office
Suite 8
110 Hay Street
SUBIACO WA 6000
Telephone: +61 8 9216 1000
Email: info@predictivediscovery.com
Website: www.predictivediscovery.com
Postal Address
PO Box 1710
WEST PERTH WA 6872
Auditor
PKF Perth
Level 4, 35 Havelock Street
WEST PERTH WA 6005
Share Registry
Computershare Pty Ltd
Level 17, 221 St Georges Terrace
PERTH WA 6000
Telephone: 1300 805 505
Website: www.computershare.com/au
ASX Code
PDI
Annual Report 2023
91
Predictive Discovery Limited
Suite 8, 110 Hay Street
WEST PERTH, WA 6005
T +61 8 9216 1000
W predictivediscovery.com.au
E info@predictivediscovery.com
ABN 11 127 871 877
ASX: PDI