RED 5 Limited Annual Report 2022

FY2022 Annual Report · RED 5 Limited

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2022 Annual Report

Corporate PROFILE

Red 5 Limited (ABN 73 068 647 610) is an Australian gold producer with
established mines located in the Eastern Goldfields of Western Australia.
The Company is listed on the Australian Securities Exchange (Ticker: RED).

Red 5 owns and operates the King of the Hills (KOTH) Gold Mine, located
approximately 900 kilometres north-east of Perth and 25 kilometres north
of Leonora in Western Australia. KOTH comprises a recently constructed
4.7 Mtpa processing plant, underpinned by an Ore Reserve of 2.4Moz of
contained gold, with ore being fed from a bulk open pit and underground
mining operation. The A$226 million development and construction of the
KOTH project was completed on time and within budget in 2022, with first
gold produced on 5 June 2022.

Red 5 also owns the Darlot Gold Mine located approximately 100 kilometres
north of KOTH. Darlot’s processing plant was recently suspended, with ore
from the Darlot underground mine now being transported to the KOTH
processing hub.

The Red 5 Group divested its interests in the Siana Gold Project in the
Philippines in September 2021. The Red 5 Group holds a royalty interest
in Siana, which is expected to return to production in 2023.

CONTENTS

Message from the Chairman

Managing Director’s Report

Environmental, Social and Governance Summary

Resources and Reserves Statement

Tenement Schedule

Financial Report

Directors’ Report

Annual Financial Statements

Notes to Financial Statements

Statement of Shareholders

Corporate Directory

Our vision is to be
a successful
multi-operational
exploration and
mining company,
providing benefits
to all stakeholders
through the
consistent
application of
technical excellence
and responsible
and sustainable
industry practices.

2022 ANNUAL REPORT

FINANCIAL AND CORPORATE
\ Divestment of the Siana Gold Project in the
Philippines was completed in September
2021, with US$19m cash consideration
received during the period. The sale
consideration also comprises an
entitlement to a 3.25% net smelter return
gold royalty from Siana.

\ Fiona Harris AM appointed to the Board as
a Non-Executive Director, adding further
corporate and governance experience to
the Red 5 Board.

\ Group cash on hand and bullion of $55.6m
at the end of June 2022, of which $15.7m is
allocated to reserve accounts and bond
guarantees for the KOTH mine.

\ $164.2m was invested in KOTH

construction and operational readiness
activities during FY-22.

\ Red 5 had fully drawn down on the $175m
KOTH project debt facility at the end of the
reporting period.

2022 HIGHLIGHTS

WESTERN AUSTRALIAN GOLD OPERATIONS
Construction of the King of the Hills Gold Mine

\ King of the Hills (KOTH) mine development completed on schedule and

within the $226 million budget. This was achieved despite the impacts
of widespread cost inflation, border closures, an unprecedented labour
and supply market and the spread of COVID-19 in Western Australia.

\ Successful commissioning of the new 4.7Mtpa processing plant,

crushing circuit and power station completed, with first gold poured on
5 June 2022 and now ramping up towards steady-state operations.

\ Over 70,000 metres of underground and open pit grade control drilling
completed, with open pit mining and underground commencing on
schedule in the March and June Quarters 2022 respectively.

\ Over 1.2 million tonnes of ore, equivalent to approximately three months

of processing feedstock, on the ROM pad as at 30 June 2022.

Darlot Gold Mine

\ Gold production of 64,667 ounces for FY-22.

\ Total gold sales for FY-22 of 64,315 ounces at an AISC of A$2,479

per ounce of gold sold.

\ Creditable safety performance, with three Lost Time Injuries (LTI) and
15 Restricted Work Injuries (RWI) recorded across Red 5’s mining,
processing and exploration activities in FY-22.

\ Darlot processing plant was suspended in July 2022, as part of the

Darlot Transition Strategy which will see the Darlot underground mine
become high-grade feed source for the new KOTH processing hub.

Exploration and resource development

\ Drilling campaigns undertaken at the KOTH open pit and underground

mines throughout the reporting period focused on a mixture of grade
control, resource definition and exploration.

\ Encouraging results at Darlot from underground diamond drilling
highlighted the potential for further Resource growth, including
significant extensions to the known mineralisation at Darlot’s Middle
Walters South, currently under development.

\ High-grade assays returned from resource and exploration drilling at
the Mission and Cable prospects, located 10km north of Darlot.

\ Great Western underground drill program demonstrates that the

Resource remains open at depth.

2022 ANNUAL REPORT

Message to Shareholders FROM THE CHAIRMAN

Dear Shareholders

I am pleased to report on what has been a year of great success
and achievement for Red 5.

Notwithstanding the unprecedented challenges of the market for
labour, equipment and services in Western Australia, surging cost
inflation and the spread of the COVID-19 pandemic, our team
successfully delivered the $226 million King of the Hills (KOTH) gold
mine on time and on budget.

At the time of this report, commissioning of all key aspects of the
new KOTH process plant had been completed with ramp-up of the
4.7Mtpa mill proceeding to plan.

The efficient, professional and seamless execution of this project is
a credit to the Red 5 team, led by our Managing Director Mark
Williams, Chief Operating Officer Jason Greive and Project
Manager Warren King – supported by our Tier-1 contracting and
business partners MACA-Interquip and Macmahon Contracting.

There is little doubt that, had we not taken the step of raising the
equity component of $125 million in March 2020 with the onset of
the global COVID-19 crisis – a move which allowed us to lock in
orders for long-lead items and secure a fixed price EPC contract –
the price tag for the KOTH project would have been significantly
higher and the timeline to completion extended.

On the corporate front, we completed the divestment of our interests
in the Siana Gold Project in the Philippines during the year, for a
consideration of US$19 million in cash as well as a net smelter return
on future gold production up to 619,000 ounces.

This has completed Red 5’s transformation from a Philippines-
focused gold producer into an Australian gold producer with an
exciting future of growth ahead of us.

As we embark on this next chapter of our growth journey, I am
pleased to say that Red 5 has continued to evolve and strengthen its
Board and senior leadership team to ensure that we have the right
skills-sets and experience to lead the Company into the future.

The Company recognises the benefits of diversity in a competitive
labour market and the importance of being able to attract, retain and
motivate employees from the widest possible pool of available talent.
Programmes are being developed to encourage diversity within
employment in the Company and in the composition of its Board

We recently welcomed Fiona Harris AM to the Board as a non-
executive Director, bringing further valuable corporate and
governance experience. Fiona has already made a strong
contribution and we look forward to her input and wise counsel in
the years ahead.

This approach also resulted in a change to the normal sequence of
events typically seen during the mine financing and development
process – with the bulk of the equity component raised before the
completion of the Final Feasibility Study in September 2020 and
ahead of the competitive $175 million debt funding package that
was secured in June 2021.

We have also continued to recruit and build our site leadership team
at KOTH with high-quality appointments during the year including
Neil Valk as General Manager Operations, Craig Hatch as Operations
Manager, Andrew McRae as Mining Manager, Oliver Keene as
Mining Manager Underground and Patrick Duffy moving to the
position of Chief Financial Officer post year end.

I would like to take this opportunity to acknowledge and thank our
financiers, BNP Paribas, HSBC and Macquarie, our key contracting
and business partners and our shareholders and key investors for
supporting our development strategy and helping us to achieve this
outcome.

Turning to our Western Australian gold operations in the Eastern
Goldfields, gold production for FY-22 was 66,871 ounces. This
reflected a strong performance by the Darlot gold mine and the
Great Western open pit, notwithstanding the impacts of operator
and skills shortages in the West Australian mining sector, high staff
turnover and the impacts of COVID-19.

In 2021, we announced a plan for the Darlot underground mine to
transition to become a high-grade feed source for the new KOTH
processing plant. In what represents a reversal of our original
operating strategy in the Eastern Goldfields, this will facilitate a
decrease in Darlot’s production cost base with ore being processed
through the low-cost 4.7Mtpa CIL plant at KOTH.

In line with this strategy, the Darlot processing plant was placed on
care and maintenance in July 2022, with trucking of Darlot
underground ore to KOTH commencing in the September Quarter
2022. This has also provided an opportunity to transition many
Darlot employees across to KOTH, reducing the labour related risks
for KOTH and at the same time de-risking the ramp-up of
production at KOTH.

2022 ANNUAL REPORT

Like other gold producers, Red 5 has not been immune to the
broad-based sell-off in global equity, debt and commodity markets
that unfolded in the final two months of the financial year and
continued into the early part of FY-23.

It is important to focus on the significant achievements of the year,
the quality of our core asset at KOTH and the strong growth
potential ahead of us – all of which will help to strengthen our
business during this period of global volatility.

With a substantial Ore Reserve of 2.4 million ounces, KOTH is a
top-10 endowed Australian gold mine and is a high-quality, long-life
and highly strategic asset. Together with the new low-cost
processing facility, KOTH will be a cornerstone of our continued
growth in the Australian gold sector.

In conclusion, my sincere thanks must go to the entire Red 5 team,
my fellow Board members, our senior management team, our
contracting partners, our financiers and our shareholders. You have
all played a vital role in our success, and I would like to thank you for
your hard work and support.

Kevin Dundo
Chairman
31 August 2022

MANAGING DIRECTOR’S Report

The 2022 financial year has been a busy
and successful period for Red 5, with the
Company successfully constructing and
commissioning Australia’s newest major
gold mine, the King of the Hills (KOTH) gold
mine in the Eastern Goldfields region of
Western Australia.

The efficient and highly professional
execution of this $226 million project during
the year is a significant achievement, with
the first gold pour on 5 June 2022 marking a
major milestone for our entire team.

Considering the challenging conditions
being experienced in the Western Australian
resource sector with widespread labour and
skills shortages, cost inflation, border
closures and the onset of the COVID-19
pandemic, the delivery of KOTH on time and
within budget is testament to the dedication
and commitment of the entire Red 5 team
supported by contracting partners
MACA-Interquip and Macmahon
Contractors.

On the mining front, Red 5’s Eastern
Goldfields operations delivered total gold
production over the past year from Darlot
and the Great Western open pit of 64,667
ounces. This was a commendable
achievement, particularly given the operator
and skills shortages experienced during the
year and high turnover of operators and
staff – an industry-wide issue which has
impacted many mining operations around
Western Australia.

Following the comprehensive review of our
operations completed last year, Red 5
implemented a revised mine plan for Darlot
which saw Redpath Mining Contractors
engaged to commence underground mine
development as part of a strategy to unlock
the project’s resource base and reduce
reliance on mining remnant areas.

Our new mine plan and future processing
strategy will see the Darlot underground
mine transition into a high-grade feed
source for the new KOTH processing plant,
with trucking of ore from Darlot to KOTH
having commenced in the September 2022
quarter.

Processing Darlot’s ore through KOTH’s
new processing plant will enable us to
deliver a step-change in production costs,
with the Darlot mill suspended in July 2022
and the bulk of the surface operations
personnel transitioned across to KOTH.

250,000mE

300,000mE

Bellevue

G
o

ﬁ

G
a

Vivien

Agnew

Agnew
1.3 Mtpa

Leinster
Goldﬁelds

i
g

Thunderbox

350,000mE

NLGP

400,000mE

150km

Darlot

100km

Darlot
1.0 Mtpa

Thunderbox
3.0 Mtpa

50km

Great Western

Bannockburn

King of the Hills

King of the Hills
4.7 Mtpa

Mt Morgans
2.8 Mtpa

6,950,000mN

Duketon
2.5, 2.5 & 5 Mtpa

Duketon

6,900,000mN

6,850,000mN

Laverton

Granny Smith
3.5 Mtpa

Mt Morgans

Leonora

Cardinia

Granny Smith

6,800,000mN

Gwalia

Gwalia
1.5 Mtpa

Mt Ida

Ulysses

Apollo Hill

Sunrise Dam

Sunrise Dam
4.1 Mtpa

RED 5 LIMITED
Tenements
ARDEA JV
Tenements
Gold Mine
(operating, closed)
Gold Project
(developing)

Mtpa

Mill throughput
(million tonnes/annum)

Gold Prospects

Greenstones

Granites

NORTH

25 Kilometers

Western
Australia

Darlot Project

King of the Hills
Project

KOTH, Darlot and Great Western locations, showing annual mill throughput from key gold deposits
in the region.

2022 ANNUAL REPORT

MANAGING DIRECTOR’S Report (cont.)

HEALTH AND SAFETY
Red 5 continues to manage and mitigate the potential impact of the
COVID-19 global pandemic on the Company’s operations. The
Management Response Plan remains focused on ensuring the
health and safety of Red 5 personnel and limiting the disruption risk
to our operations.

This plan has been progressively developed in line with the formal
guidance of State and Federal health authorities, in close
coordination with the Australian Resources and Energy Group
(AMMA) and under the Company’s existing Emergency
Management Policies.

The Company continues to closely monitor the advice and
requirements from State and Federal Governments and health
authorities and maintain its focus on the health and well-being of
staff and the communities in which we operate.

Three Lost Time Injuries (LTI) and 15 Restricted Work Injuries (RWI)
were recorded across Red 5’s mining, processing and exploration
activities in FY-22.

EASTERN GOLDFIELDS,
WESTERN AUSTRALIA
Red 5 holds an extensive 2,555km2 strategic tenement footprint in
the world-class Leonora-Leinster mineral district in the northern
goldfields of Western Australia, which includes the Darlot and Great
Western gold mines and the KOTH gold mine where construction
was completed in late FY-22.

In addition to its operating gold mines, Red 5’s tenements also offer
significant exploration upside, with active exploration programs
being undertaken at both Darlot and KOTH during the year.

KING OF THE HILLS CONSTRUCTION

Development activities were completed at KOTH during FY-22, with
first ore processed through the 4.7Mtpa processing plant in May
2022 and first gold poured on 5 June 2022.

Process plant construction

Construction of the process plant and other infrastructure
progressed on schedule and within budget throughout the
reporting period.

As at 30 June 2022, key construction status included:

\ commissioning of the gravity and elution circuits completed;

\ SAG mill currently achieving throughput rates of 600 tonnes per
hour for extended periods at moderate mill load and power
draw;

\ commissioning of the variable speed drive completed;

\ installation of the KOTH power station and gas supply

completed.

At 30 June 2022 the KOTH processing team was focused on
increasing the mill production rate and completing outstanding
punch list items with the EPC contractor.

2022 ANNUAL REPORT

Village construction

The KOTH accommodation village and infrastructure was
completed in the September Quarter 2021. The village can
accommodate 380 personnel with provision to expand to 450,
including water treatment and waste-water treatment plants.

KOTH power station and gas supply

KOTH’s turnkey power station was supplied by Zenith Pacific.
Construction and commissioning of the gas pipeline, connecting
KOTH to APA’s goldfields gas pipeline, was completed during the
March 2022 Quarter.

Installation of the KOTH power station was complete as at the end
of FY-22, with a combination of gas and solar energy supplying site
power.

MANAGING DIRECTOR’S Report (cont.)

KING OF THE HILLS OPERATIONAL RAMP-UP

KOTH mining activities

Open pit grade control drilling

Red 5 completed an initial 70,000 metres of grade control drilling in the
KOTH southern pit during FY-22 to cover the first 30 to 45 metres
vertically of the current Stage 1 design. Open pit grade control will be
conducted in phases, with the initial phase of drilling designed to cover
the first six months of open pit mining with the objective of de-risking
and setting up the initial ore blocks for mining.

Underground drilling

In preparation for mining at KOTH, approximately 40,100 metres of
underground drilling was undertaken in FY-22, with an additional
86,000 metres planned for FY-23 for an estimated total of 140,000
metres. Drilling is focused on a mixture of grade control, resource
definition and exploration programs.

KOTH processing

The KOTH processing facility was commissioned in May 2022 and has
been progressively ramping up, with both throughput rates and gold
recoveries in-line with expectations. The gas power station has been
operating to plan, and the water balance has now reached steady state,
with all water bores and Tailings Storage Facility (TSF) return water
infrastructure operational.

The first gold pour from the process plant was achieved on 5 June
2022. During June 2022, the total mill operating time was 84%. The
SAG mill continues to deliver throughput rates in excess of 600 tonnes
per hour for significant periods at moderate mill loads and power draw.

A total of 385,704 dry tonnes was milled up to 30 June 2022, producing
a total of 9,545 ounces at an average recovery of 90.9% and grade of
0.85g/t. The reconciled grade of near surface KOTH ore was 0.55g/t,
with over 60% of the processing feed stock sourced from historical
stockpiles. The reconciled grade of KOTH ore was within 1% of the
expected grade of ore mined at this stage of the open pit cut-back. The
processing plant feed was supplemented by higher-grade ore trucked
from the Great Western satellite open pit during May and June 2022.

During the June Quarter, Macmahon Contractors progressively
ramped up total material movement as two open pit fleets and
supporting ancillary equipment began operating on a double
shift basis.

Macmahon mined 2.9 million bank cubic metres (Mbcms) in the
June Quarter from the Stage 1 pit, including 365,675 tonnes of
ore at an average grade of 0.52g/t (consistent with the expected
grade of ore mined at this stage of the open pit cut-back). Land
clearing for the waste storage facility is progressing to plan, drill
and blast activities are on plan.

Construction of the Run of Mine (ROM) pad was completed
early in the quarter. The ROM pad is now established and has
been designed to allow highly efficient “super-quad” road trains
to deliver ore from off-site sources such as Great Western and
Darlot as part of a strategic haulage agreement in place with
key business partner MLG.

The construction of Tailings Storage Facility 5 (TSF5) is
progressing to plan. Following the TSF5 construction tender
award in May 2022, the successful contractor, Iron Mining, has
mobilised to site and begun site establishment and
construction. All construction materials for TSF5 have been
sourced from Stage 1 open pit mining activities.

Underground mine development activities continued during the
quarter, with over 800 metres of development completed. The
first stope was fired in June 2022, signalling the
commencement of underground production activities.
Underground infrastructure is still under development, with
connection to the site high voltage system to occur early in the
September Quarter.

Mining infrastructure establishment continues, with the
completion of the heavy vehicle workshop, offices, change
rooms, ablutions and training facilities expected in the
September 2022 Quarter.

2022 ANNUAL REPORT

MANAGING DIRECTOR’S Report (cont.)

WESTERN AUSTRALIAN GOLD OPERATIONS

Darlot production summary

A total of 64,667 ounces of gold was recovered for the 12 months to 30 June 2022, with ore sourced from the Darlot underground mine and
the Great Western open pit. During the June Quarter, 9,473 ounces of gold produced from Darlot’s Great Western satellite mine included
7,341 ounces processed at the KOTH process plant in May and June.

Processing – Darlot

A total of 974,269 tonnes of ore was milled at an average grade of 2.0g/t during FY-22.

Table 1: Darlot mill processing statistics

Units

g/t

June 2022
Quarter

197,688

1.88

94.4

11,245

12,225

March 2022
Quarter

December 2021
Quarter

September 2021
Quarter

FY-22
Total

246,307

281,161

249,133

974,269

1.83

90.9

13,185

14,644

1.98

92.2

16,519

15,839

2.20

92.9

16,377

15,908

2.00

92.4

57,326

58,616

Ore milled

Average head grade

Recovery

Gold recovered

Gold sales

Mining activities – Darlot

Mining during the year predominantly focused on the Middle Walters South (MWS), Burswood, Oval 1300, Pedersen Lower, Thomson,
Federation 1190, Lillie 1065 and the Lords South 685 and 750 areas.

Capital development was undertaken in the Middle Walters South incline/decline, Burswood incline, Lillee and Pedersen Lower sectors.
Production during the reporting period originated from the Grace, Border, Lillee, Bradman, Thomson, Lords, Walters and Federation areas.

Mining activities – Great Western

Mining of the Great Western open pit continued throughout the reporting period. At the end of FY-22, the Great Western open pit had
progressed to within two benches of its final design depth and was completed in July 2022. The mine was then placed into care and
maintenance while the underground potential is assessed.

2022 ANNUAL REPORT

MANAGING DIRECTOR’S Report (cont.)

EXPLORATION AND RESOURCE DEVELOPMENT
KING OF THE HILLS

King of the West

The 40,100 metres of drilling conducted at KOTH for FY-22
focussed on a mix of stope de-risking (GC) and infill and
extensional drilling for resource development. The key areas
targeted were:

\ de-risking narrow vein stopes in the Central area;

\ de-risking bulk stopes in the Syra (West decline below the

W4890) and West decline below W4895;

\ infilling the Regal (north) 4925 stope shapes from the W4950

and Regal 4885;

Assay results from air-core (AC) drilling completed over the King of
the West area in March 2021 identified significant gold anomalism
associated with a sheared mafic-granite contact and sheared mafic
host rock similar to the mineralisation setting observed at Great
Western.

Large parts of the tenement remain untested, with structures and
geology bearing similarities to major gold deposits in the area,
including Great Western. The AC program was designed to test
three of these areas to identify targets for follow-up RC drilling.

\ testing the Regal area below the 4925 and East – West Link.

Great Southern

DARLOT

Darlot near-mine exploration

Near-mine drilling at Darlot during FY-22 focused on extending new
mining areas such as Middle Walters South and reducing the
dependency on remnant mining. Results reported included strong
intercepts from Middle Walters South and positive results from
Dar-Cent, Oval 1300 and Pedersen Lower, all of which offer the
opportunity for resource growth.

A pXRF soil sample program covering the Great Southern area
commenced in late April 2022 and was ongoing at the end of the
reporting period. The target area represents the southern-most
extent of the Yandal Belt, containing a central corridor of NW
trending ultramafic-mafic greenstones which are bound to the east
and west by granitoids. Structurally, the package is superficially
analogous to Darlot, bound and intersected by the regional NNW
trending El Dorado and Waikato shear zones, and deformed by
smaller-scale structures.

Great Western

Gilmore Well

The Gilmore Well prospect, located approximately 10km SW of the
Darlot mine, comprises a large and sparsely explored area west of
the Emperor mineralised corridor. Previous exploration results from
historical soil and rock chip sampling defined a continuous NW-SE
gold trend extending up to 1km, as well as several smaller NE-SE
and N-S oriented Au trends which range in length between 300-400
metres. Historical assay results reported values up to 2.9g/t Au in
rock chips (sourced from auriferous quartz veins) and 20ppb Au
from soil samples. The main NW-SE trending corridor is parallel to
the proximal Emperor trend, and all identified gold trends show a
spatial relationship with the margins of prominent magnetic highs
and areas of sub-cropping dolerite and vein quartz float.

The first stage of the Great Western underground drill program
comprising nine exploration drill holes was completed in mid-
December 2021. The program was designed to test the
underground potential of the Great Western orebody below the
open pit and returned encouraging results with drill holes
intersecting a mineralised zone ranging from sub-1.0 metres up to
4.0 metres in width over an approximate 300-metre strike length.

The geology logging results confirm that the orebody continues at
depth below the Great Western open pit and provides evidence that
supports ongoing resource exploration drilling to further de-risk the
underground resource potential and test the extent of the orebody,
which remains open at depth.

Mission and Cable

Resource definition and exploration drilling completed at the
Mission and Cable prospects, located 10km north of Darlot,
delivered high-grade assay results and identified new zones of gold
mineralisation.

The drilling program comprised a combination of reverse circulation
(RC) percussion drilling to underpin an upgrade of the historical
JORC 2004 mineral resource estimates to JORC 2012 status, as
well as exploration diamond drilling aimed at identifying new zones
of mineralisation.

At Cable, diamond exploration drilling identified a broad new zone
of mineralisation measuring between 70 and 100 metres width,
which was intersected in all diamond holes and is observable along
the entire length of the known extent of gold mineralisation.

At the Mission prospect, similar to Cable, assay results from both
the RC and diamond drill programs have been encouraging,
confirming good continuity of gold mineralisation and identifying
new zones of mineralisation within the historical oxide mineral
resource.

2022 ANNUAL REPORT

MANAGING DIRECTOR’S Report (cont.)

CORPORATE
Divestment of Siana gold project

In September 2021, Red 5 completed the divestment of its interests
in Philippine affiliated company Greenstone Resources Corporation
(GRC), which holds both the Siana and Mapawa gold projects in the
Philippines, to TVI Resource Development (Phils.) Inc. (TVIRD).

TVIRD is the Philippine affiliate of the Canadian-listed TVI Pacific
Inc. TVIRD has two operating mines and a number of other
development projects in the Philippines with interests in gold, nickel
and copper.

Consideration for the transaction comprised US$19m cash, which
was received during the reporting period. In addition, the sale
consideration includes an entitlement to a net smelter return royalty
of 3.25% for up to 619,000 ounces of gold, which will become
payable from first gold from the restart of the Siana processing
plant. Based on an assumed gold price of US$1,800/oz, this royalty
has an estimated future face value of US$36m.

The divestment of its interests in the Siana and Mapawa projects is
consistent with Red 5’s strategy to focus on its KOTH and Darlot
gold mines in Western Australia.

Financial

The Group recorded sales revenue of $165.0 million for the 2022
financial year. Net cash outflows from operating activities was
$2.4 million with $55.6 million in cash and bullion at year-end, of
which $15.7 million was allocated to reserve accounts and bank
guarantees for the KOTH project.

For the year ended 30 June 2022, the Company recorded a gross
loss from operations of $31.1 million and a net loss after income tax
of $28.6 million.

SUMMARY AND OUTLOOK
With production now ramping up at the new, long-life KOTH gold
mine, the coming financial year is set to be a defining period for Red
5, with the Company expected to join the ranks of mid-tier
Australian gold producers during FY-23.

The new modern 4.7Mtpa mill at KOTH provides a platform for Red
5’s next growth chapter, with the capacity to process ore from
Darlot to deliver a reduction in group operating costs.

While much of the focus over the past year has been on our
activities at KOTH, we have also laid the foundations for new growth
and development at Darlot, with a high-rate development strategy
initiated in early FY-22 set to unlock new mining areas in the Middle
Walters South, Pedersen and Burswood areas of the Darlot
underground in FY-23.

In parallel with our mining and processing operations, Red 5 will
also continue its exploration and resource development activities,
with targeted drilling programs planned across key targets over the
coming year.

All these activities will be conducted with a commitment to the
Company’s environment, social and governance principles. Further
information regarding the Company’s ESG activities is contained in
the following section of this report.

With these foundations, the coming year will be a busy and exciting
growth period for Red 5. The strength of this position is thanks to
the outstanding hard work and commitment of the Red 5 team of
staff and contractors, who have delivered an exceptional effort over
the past year.

I would also like to thank our shareholders for their continued
support.

Mark Williams
Managing Director

31 August 2022

2022 ANNUAL REPORT

ENVIRONMENTAL, SOCIAL AND GOVERNANCE Summary

FY22 OVERVIEW
FY-22 marked a defining period in Red 5’s growth pathway to
becoming a mid-tier Australian gold producer. The construction,
ramp up and delivery of the King of the Hills (KOTH) Mine was
achieved on time and within budget. Throughout the year, the
Company’s key Environment, Social and Governance (ESG)
focus was:

1. maintaining compliance.

2. maximising water efficiency.

3. minimising waste.

improving our carbon footprint.

5. stakeholder engagement.

ENVIRONMENT

Water management

KOTH mine dewatering and existing production bores around the
open pit provided the necessary water supply for the KOTH
processing plant construction, commissioning and ramp up. The
re-commissioned Sullivan Creek borefield, including four new
production bores, mine dewatering and recycled tailings decant
water will continue to support operations going forward.

Routine monitoring is vital to the sustainability of our groundwater resources.

Waste management

In FY-22 a specialist waste management contractor was engaged
to demolish the remains of the historical processing and
administration infrastructure at KOTH, as well as provide waste
management services for the operations. Disposal and recycling
processes across the operation will continue to be refined and
improved in collaboration with business partners, which will include
a new landfill, scrap storage/salvage and bioremediation area
planned for construction in early FY-23.

Green House Gas management

Power for the KOTH operation is sourced from an onsite hybrid
gas-solar power station. This has significantly reduced the
operation’s carbon footprint relative to a diesel fuelled power
generation alternative. The installation includes a 2MW solar farm
and solar arrays to power some production bores further reduces
the operation’s carbon emissions.

Solar farm at KOTH providing 2MW to the operation.

Borefield powered by a solar array.

SOCIAL

Cultural heritage

The landscape in the region holds special significance for local
traditional owners. Surveys involving specialist archaeologists,
anthropologists and the traditional owners have taken place in all
areas of our operation. Sites of importance have been mapped and
integrated into our mine planning process to avoid these sites and
protecting them for the future.

Red 5 is committed to engaging and consulting with traditional
owners to ensure protection of important cultural heritage values
and to maintain a positive relationship between the Darlot people
and Red 5.

Human capital

Red 5 is committed to ensuring that it is an employer of choice and
that it provides a safe, respectful work environment for all its
employees. It has in place a Diversity Policy and will look to further
develop its diversity activities having regard to the challenging
Western Australian market for talent.

Red 5 notes the reports prepared for the Western Australian
Parliament in 2022 titled “Sexual Harassment on Women in the
FIFO Mining Industry” and has developed a program in response
for implementation in FY23.

Community relations

Red 5 operates in a sparsely populated region with the main
communities being in the township of Leonora and several local
landowners. A number of providers located in the region benefit
from the Red 5 operations through provision of services.

Red 5’s presence additionally benefits the community through our
emergency medical facilities and medical response capability and
various levels of assistance to our surrounding pastoralists.

2022 ANNUAL REPORT

ENVIRONMENTAL, SOCIAL AND GOVERNANCE Summary (cont.)

FY22 OVERVIEW
GOVERNANCE

Approvals and compliance

Mining proposals and works approvals for KOTH were in place for the
construction and commissioning of the new processing plant, TSFs and
associated infrastructure that occurred during FY22.

Routine monthly, quarterly and annual compliance monitoring, sampling
and reporting have continued across the operations during the year with
no issues to report. There were no fines or penalties imposed on the
Company and no serious environmental incidents.

Corporate Governance Policy Structure

Governance

Social

Environment

FY23 OBJECTIVES
MATERIAL TOPICS ASSESSMENT

With the support of a specialist sustainability consulting firm,
a materiality assessment was undertaken to identify key
sustainability topics which are important to us and our
stakeholders in FY22. Workshop sessions were completed
based on a list of potential material topics. Based on these
workshops the following list of potential material topics has
been developed.

ESG Material Topics
Summary
This is a summary of the material topics of focus for FY23.

01
HUMAN CAPITAL
\ Workplace Health and

Safety

04
SOCIAL CAPITAL
\ Cultural Heritage & Native

Title

\ Employee Engagement
\ Diversity

\ Socio-economic and

community contributions

05
ENVIRONMENT
\ Energy Management &

renewables

\ Water Management

02
BUSINESS MODEL
\ Economic Performance

03
GOVERNANCE
\ Critical Risk Management
\ Corporate Governance
\ Business Partner ESG

Performance

Based on the above priority lists, the following work program
has been developed for the focus of the ESG program in
FY23.

Our ESG Roadmap
FY23

Q1 GOAL
Finalise Framework for ESG
Reporting for FY23

Q3 GOAL
Stakeholder Management
Plan released

FY24 Q1 GOAL
Implement FY24 - 26
ESG Plan

Q2 GOAL
Start collecting information
and data

Q4 GOAL
Release ESG Report for FY23
Develop ESG Plan for FY24-26
Stakeholder Survey

Further details on the Company’s ESG programs are
available in the 2022 Environmental, Social and Governance
Report available on the Company’s web-site at
www.red5limited.com.

Board responsibility

Board charter

Constitution

Continuous disclosure policy

Code of conduct

Corporate governance
statement

Securities trading policy

Shareholder communications
policy

Modern slavery statement

Audit Committee responsibility

Audit committee charter

Anti-bribery and corruption
policy

Selection and performance of
external auditor

Whistleblower policy

Remuneration Committee
responsibility

Remuneration committee
charter

Selection and nomination of
new directors

Diversity policy

Risk and Environment
Committee responsibility

Risk and environment
committee charter

Risk management policy

Environmental policy statement

Health, Safety and Community
Committee responsibility

HSC committee charter

Occupational health and safety
policy

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement

WESTERN AUSTRALIAN GOLD OPERATIONS
KING OF THE HILLS GOLD PROJECT
The Mineral Resource for the King of the Hills (KOTH) project has
increased by 6% for an additional 277koz since 30 June 2021.
During the 2022 financial year, Red 5 completed a 70,000 metre
reverse circulation (RC) open-pit grade control program targeting
stage 1 of the KOTH open-pit and an approximate 40,100 metres of
underground drilling for stope de-risking and resource
development. The 7 x 7 metre spaced open-pit grade control
program has been modelled and reported as Measured along with
a full resource update on available assays for underground for the
30 June 2022 resource model update.

The combined open-pit and underground Ore Reserve at KOTH,
which includes regional open pit reserves, as at 30 June 2022 is
70.2Mt @ 1.2g/t for 2.66Moz of contained ounces. This represents
an increase of 12.7% for an additional 300koz, net after depletion
since 30 June 2021. The key catalyst for this growth is in the KOTH
open-pit where grade control drilling has driven the reclassification
of waste into ore and the deepening of the ultimate pit design.

The KOTH Mineral Resource and Ore Reserve estimates, net of
mining depletion, as at 30 June 2022 are detailed on the next page.

The KOTH Mineral Resource, which includes all historic stockpiles,
ROM and underground broken stocks, as at 30 June 2022 is
105.5Mt@ 1.4g/t for 4.75Moz of contained ounces.

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

King of the Hills JORC 2012 Resources and Reserves as at 30 June 2022

King of the Hills Gold Project Mineral Resource as at 30 June 2022

Project

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

King of the Hills

0.4

1.0

Variable

All

0.6

0.4

0.5

King of the Hills - sub total

Rainbow

Severn

Centauri

Cerebus-Eclipse

0.5

Regional Resources

Variable

Regional Resources - sub total

King of the Hills and Regional Resources

Variable

1.0

King of the Hills and Regional Resources - sub total

Stockpiles

Broken Stocks

ROM

Stockpiles - sub total

0.0

Variable

Total King of the Hills Gold Project
(as at 30 June 2022)

Variable

All

Grand total

Measured

Indicated

Inferred

Sub Total

Indicated

Inferred

Sub Total

Measured

Indicated

Inferred

Indicated

Inferred

Sub Total

Indicated

Inferred

Sub Total

Indicated

Inferred

Sub Total

Indicated

Inferred

Sub Total

Indicated

Inferred

Measured

Indicated

Inferred

Sub Total

Indicated

Inferred

Sub Total

Indicated

Measured

Indicated

Inferred

1,330

66,870

12,990

81,190

6,010

8,080

14,090

1,330

72,880

21,070

95,280

1,380

200

1,580

480

440

920

1,390

320

1,710

2,160

650

2,810

5,410

1,610

7,020

1,330

72,280

14,600

88,210

6,010

8,080

14,090

102,300

2,064

1,120

3,189

2,455

80,354

22,680

105,489

1.2

1.3

2.4

2.1

2.2

1.2

1.4

1.6

1.4

1.3

1.4

1.3

1.7

1.5

1.6

1.5

1.3

1.5

1.3

1.1

1.3

1.4

1.3

1.4

1.2

1.3

2.4

2.1

2.2

1.4

0.4

1.2

0.6

0.5

0.9

1.4

1.6

1.4

2,800

540

3,390

450

550

1,000

3,250

1,090

4,390

112

242

308

3,042

607

3,698

450

550

1,000

4,698

0.2

3,519

1,157

4,748

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

King of the Hills Gold Project Mineral Resource as at 30 June 2021

Project

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

King of the Hills and Regional Resources

Variable

All

King of the Hills and Regional Resources - sub total

Stockpiles

Broken Stocks

ROM

Stockpiles - sub total

0.0

Variable

Total King of the Hills Gold Project
(as at 30 June 2021)

Variable

All

Grand total

King of the Hills Gold Project Mineral Resource - difference

King of the Hills Gold Project

Variable

All

Grand total - difference

Production for FY22

Measured

Indicated

Inferred

Indicated

Measured

Indicated

Inferred

Measured

Indicated

Inferred

75,210

22,510

97,720

2,810

111

2,921

111

77,820

22,810

100,741

2,344

5,519

-130

7,733

1,178

0.0

1.3

1.6

1.4

0.5

0.0

0.9

0.5

0.9

1.3

1.6

1.4

0.0

0.6

3,252

1,127

4,379

3,312

1,157

4,471

257

326

King of the Hills Gold Project Ore Reserve as at 30 June 2022

Project

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

King of the Hills

0.4

King of the Hills – sub-total

Rainbow

Centauri

1.3

0.3

Cerebus-Eclipse

0.3

Regional Resources - sub total

Stockpiles

Broken Stocks

ROM

Stockpiles – sub-total

King of the Hills Gold Project
(as at 30 June 2022)

Grand total

0.0

Variable

All

Variable

All

Proved

Probable

Sub Total

Proved

Probable

Sub Total

Proved

Probable

Sub Total

Proved

Probable

Sub Total

Proved

Probable

Sub Total

Probable

Proved

Probable

1,327

59,036

60,363

2,835

63,198

2,054

326

1,490

3,869

2,064

1,007

3,076

2,384

67,804

70,188

1.0

1.2

0.0

2.0

1.2

0.0

0.8

0.0

1.2

0.0

1.0

0.4

1.2

0.6

0.5

0.8

1.2

2,280

2,322

177

2,499

116

2,600

2,663

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

King of the Hills JORC 2012 Resources and Reserves as at 30 June 2022 (cont.)

King of the Hills Gold Project Ore Reserve as at 30 June 2021

Project

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

King of the Hills and Regional Resources

Variable

All

King of the Hills and Regional Resources - sub total

Stockpiles

Broken Stocks

ROM

Stockpiles – sub-total

King of the Hills Gold Project
(as at 30 June 2021)

Grand total

0.0

Variable

All

Variable

All

King of the Hills Gold Project Ore Reserve - difference

King of the Hills Gold Project

Variable

All

Grand total - difference

Production for FY22

Proved

Probable

Proved

Probable

Proved

Probable

61,679

2,810

111

2,921

111

64,489

64,600

2,273

3,315

5,588

1,178

0.0

1.2

0.5

0.0

0.9

0.5

0.9

1.1

-0.1

0.0

0.6

2,341

2,381

2,384

220

279

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

DARLOT GOLD PROJECT

The Mineral Resource for the Darlot Gold Project has increased by 25% for an additional 366koz since 30 June 2021. This resource
increase has been the result of several factors including updated resource models for the Middle Walters South, Centenary and Pederson
deposits, improved accuracy of the lode interpretations at Darlot as a result of the additional resource drilling reported. This also includes
the inaugural release of the JORC 2012 resource modelling of Mission and Cable deposits. These resources form part of the exclusive
sub-lease over the southern portion of Exploration Licence E37/1220.

The Darlot Gold Project Mineral Resource as at 30 June 2022, which includes all stockpiles, ROM, and underground broken stocks, is
17.1Mt @ 3.4g/t for 1.84Moz of contained ounces.

The Ore Reserve for the Darlot Gold Project has decreased by 12.8% for a reduction of 16koz, net after depletion since 30 June 2021. The
major contributors to the decrease are the change in cut-off grade driven by cost inflation and the depletion of the Great Western open-pit
which completed mining in FY22. Further work is scheduled to progress in FY23 to convert the Great Western underground resource to
reserves. The Darlot Gold Project Ore Reserves as at 30 June 2022 is 1.3Mt @ 2.6g/t for 109koz of contained ounces.

The Darlot Gold Project Mineral Resource and Ore Reserve estimates, net of mining depletion, as at 30 June 2022 are detailed below.

Darlot Gold Project JORC 2012 Resources and Reserves as at 30 June 2022

Darlot Gold Project Mineral Resource as at 30 June 2022

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

Project

Darlot

2.0

Measured

Indicated

Inferred

Sub Total

Measured

Indicated

Inferred

Sub Total

Measured

Indicated

Inferred

Sub Total

Measured

Indicated

Inferred

Sub Total

Great Western

1.5

Underground – sub-total

Darlot Region

0.5

Great Western

0.5

Open-pit – sub-total

Darlot & Great Western UG & OP Resource - sub total

Broken Stocks

ROM

Stockpiles – sub-total

Darlot Gold Project
(as at 30 June 2022)

Grand total

Variable

Measured

UG & OP Measured

Variable

All

Indicated

Measured

Inferred

7,149

4,846

11,998

142

199

12,196

100

810

3,508

4,418

186

4,604

16,800

251

267

375

8,099

8,593

17,067

7.4

4.3

3.9

4.1

0.0

4.0

3.1

3.4

4.1

1.0

1.2

0.7

1.4

2.8

2.7

1.9

2.3

1.4

3.4

2.3

0.6

0.7

0.8

4.0

2.6

3.4

987

612

1,599

1,621

200

214

1,834

1,032

708

1,840

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

Darlot Gold Project JORC 2012 Resources and Reserves as at 30 June 2022 (cont.)

Darlot Gold Project Mineral Resource as at 30 June 2021

Project

Au cut
off g/t

Mining
Method

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

Darlot and Great Western

0.5 - 2.0

UG & OP

Indicated

Measured

Darlot and Great Western – sub-total

Broken Stocks

ROM

Stockpiles – sub-total

Darlot Gold Project
(as at 30 June 2021)

Grand total

Inferred

Variable

Measured

0.5 - 2.0

All

Darlot Gold Project Mineral Resources - difference

Darlot Gold Project

0.5 - 2.0

All

Grand total - difference

Production for FY22

Darlot Gold Project Ore Reserve as at 30 June 2022

Measured

Indicated

Inferred

Measured

Indicated

Inferred

Proved

Probable

Proved

Probable

Proved

Probable

Proved

Probable

Proved

Probable

Au cut
off g/t

Mining
Method

1.7 - 2.4

Variable

Proved

Variable

All

Variable

Proved

UG & OP

Proved

Variable

All

Project

Darlot

Darlot – sub-total

Broken Stocks

ROM

Stockpiles – sub-total

Darlot Gold Project
(as at 30 June 2022)

Grand total

Broken stocks

ROM

Stockpiles – sub-total

Darlot Gold Project
(as at 30 June 2021)

Grand total

Darlot Gold Project Ore Reserve as at 30 June 2021

Darlot and Great Western

Variable

UG & OP

Darlot and Great Western – sub-total

Darlot Gold Project Ore Reserve - difference

Darlot Gold Project

Variable

All

Grand total - difference

Production for FY22

2022 ANNUAL REPORT

159

7,771

5,962

13,892

159

7,771

5,962

13,962

215

329

2,631

3,105

1,490

2.1

3.8

2.7

3.3

2.5

1.0

1.2

2.1

3.8

2.7

3.3

-1.3

0.2

-0.1

0.1

1.6

947

513

1,471

0.7

2.0

2.7

947

513

1,474

-1

285

366

1,256

1,305

104

2,309

2,414

154

2,309

2,464

-105

-1,053

-1,159

1,490

0.0

2.6

2.3

1.6

1.8

2.6

3.0

2.6

2.5

1.3

1.5

2.5

2.6

-0.7

0.0

1.6

106

109

191

201

191

203

-9

-85

-94

Classification

Tonnes (kt)

Grade
Au (g/t)

Contained
Au (koz)

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

PHILIPPINE OPERATIONS
SIANA GOLD PROJECT

During the 2022 financial year, the Group divested its interests in the Siana Gold Project located in the Philippines and retains a 3.25% Net
Smelter Return royalty payable up to 619,000oz of gold produced.

COMPETENT PERSON’S STATEMENT
Accountabilities for compilation of the 2022 annual Mineral Resource and Ore Reserve estimates are summarised in the table below.

COMPETENT PERSONS FOR JORC 2012 MINERAL RESOURCE AND ORE RESERVE

Discipline

Competent Person

Role

Project

Mineral Resources

Byron Dumpleton

Chief Geologist
(Red 5 Limited)

Ore Reserves

Kevin Oborne

Group Technical Services
Manager
(Red 5 Limited)

King of the Hills
Darlot
Great Western
Regional Resources

Professional
Membership

Membership
Number

AIG

1598

AusIMM

226591

Mineral Resource

Ore Reserve

Mr Byron Dumpleton confirms that he is the Competent Person
for the Mineral Resources summarised in this report and Mr
Dumpleton has read and understood the requirements of the
2012 Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves
(JORC Code, 2012 Edition). Mr Dumpleton is a Competent
Person as defined by the JORC Code, 2012 Edition, having five
years’ experience that is relevant to the style of mineralisation
and type of deposit described in this report and to the activity
for which he is accepting responsibility. Mr Dumpleton is a
Member of the Australian Institute of Geoscientists, No. 1598.
Mr Dumpleton is a full time employee of Red 5 Limited. Mr
Dumpleton has reviewed this report and consents to the
inclusion of the matters based on his supporting information in
the form and context in which it appears.

Mr Dumpleton verifies that the Exploration Results and Mineral
Resource estimate section of this report is based on and fairly
and accurately reflects in the form and context in which it
appears, the information in his supporting documentation
relating to Open Pit and Underground Mineral Resource
estimates.

Mr Kevin Oborne confirms that he is the Competent Person for
the underground and open-pit Ore Reserve estimates
summarised in this report and Mr Oborne has read and
understood the requirements of the 2012 Edition of the
Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves (JORC Code, 2012 Edition). Mr
Oborne is a Competent Person as defined by the JORC Code,
2012 Edition, having five years’ experience that is relevant to the
style of mineralisation and type of deposit described in the
report and to the activity for which he is accepting
responsibility. Mr Oborne is a Member of the Australasian
Institute of Mining and Metallurgy, No. 226591. Mr Oborne is a
full time employee of Red 5 Limited. Mr Oborne has reviewed
this report and consents to the inclusion of the matters based
on his supporting information in the form and context in which it
appears.

Mr Oborne verifies that the Ore Reserve section of this report is
based on and fairly and accurately reflects in the form and
context in which it appears, the information in his supporting
documentation relating to the Ore Reserves.

Red 5 confirms that it is not aware of any new information or
data that materially affects the information included in the
original ASX market announcements and that all material
assumptions and technical parameters underpinning the
estimates in the relevant ASX market announcements continue
to apply and have not materially changed. The Company
confirms that the form and context in which the Competent
Persons findings are presented have not been materially
modified from the original market announcements.

2022 ANNUAL REPORT

MINERAL RESOURCES AND ORE RESERVES Statement (cont.)

GOVERNANCE AND
INTERNAL CONTROLS
Mineral Resources and Ore Reserves
are estimated either by suitably qualified
consultants or internal personnel in
accordance with the applicable JORC Code
and using industry standard techniques and
internal guidelines for the estimation and
reporting of Mineral Resources and Ore
Reserves. All data is collected in
accordance with applicable JORC Code
requirements. Ore Reserve estimates are
based on pre-feasibility or feasibility studies
which consider all material factors.

The estimates and supporting data and
documentation are reviewed by qualified
Competent Persons (including estimation
methodology, sampling, analytical and
test data).

GENERAL NOTES
Mineral Resources are quoted as inclusive
of Ore Reserves and Ore Reserves are
quoted as inclusive of Mineral Resources.
Discrepancy in summation may occur due
to rounding. Figures take into account
mining depletion as at 30 June 2022.
Figures also include ROM and broken
stocks for Darlot, Great Western and KOTH
operations as at 30 June 2022.

For information that relates to KOTH
Resources, KOTH Regional Resources,
KOTH Ore Reserves, Darlot Gold Project
Resources, Darlot Gold Project Ore
Reserves, refer to the ASX release dated
7 September 2022 and titled Ore Reserves
and Mineral Resources Statement.

KING OF THE HILLS GOLD
PROJECT

Mineral Resources:

1. The Measured component for the KOTH

open pit resource is based on updated
resource developed from the 70,000m
Open Pit RC grade control drilling at a
nominal drill spacing of 7 x 7m and 2m
sample interval, refer to the Mineral
Resource and Ore Reserve ASX release
dated 7 September 2022.

2. The information that relates to Rainbow
and Severn which forms part of the
KOTH Regional resources refer to ASX
release dated 1 May 2019 titled Maiden
JORC open pit Resources defined for
near-mine regional deposits at King of
the Hills.

3. The information that relates to Centauri
and Cerebus-Eclipse which forms part
of the KOTH Regional resource refer to
ASX release dated 6 May 2020 titled
Additional Resources defined for
satellite open pit deposits at King of
the Hills.

Ore Reserves:

1. KOTH reserves are based on a gold

price of A$2,100/oz.

2. Cut-off grades for the KOTH open-pit
are 0.4g/t Au, the KOTH underground
are 1.2g/t Au, and regional resources
are 0.4g/t Au.

3. KOTH open-pit and regional open-pit

reserves generated with detailed pit
designs based on A$2,000/oz pit shells.

4. Ore loss and dilution for the KOTH

open-pit were reflected in the Selective
Mining Unit process.

5. Underground reserves include 5% or
9koz of Inferred material entrained
within stope designs.

6. The information that relates to the
Rainbow, Centauri, and Cerebus-
Eclipse open-pit reserves refer to ASX
release dated 15 September 2020, titled
KOTH Final Feasibility Study delivers
2.4Moz Ore Reserve, underpinning an
initial 16-year mine life and confirming a
clear pathway to production in 2022.

DARLOT GOLD PROJECT

Mineral Resources:

1. Darlot regional open pit resources

includes the inaugural release of the
Mission and Cable JORC 2012
resource. Refer to the Mineral Resource
and Ore Reserve ASX release dated
7 September 2022.

2. The Darlot Region Open Pit Resource
figures include the Waikato South
(1,902kt @ 0.8g/t for 50koz) and
Cornucopia North (62kt @ 1.3g/t for
3koz) deposits. The tenements on which
these Resources are located are held
under a Joint Venture with PanAust,
where Darlot Mining Company (DMC)
owns 84% and PanAust 16%. For
information that relates to these
deposits refer to the Red 5 Resource
and Reserve growth at Darlot Gold Mine
ASX release dated 10 February 2020.

Ore Reserves:

1. The updates to the underground

reserves are based on a gold price of
A$2,300/oz.

2. Cut-off grades for the underground

reserves are 2.4g/t Au.

3. Underground reserves have planned
dilution varying between 10% to 20%
with planned mining recovery between
90% to 95%.

4. Underground reserves include 7% or
7koz of Inferred material entrained
within stope designs.

2022 ANNUAL REPORT

TENEMENT Schedule 30 June 2022

WESTERN AUSTRALIA

Project

Tenement number

King of the Hills Gold Mine

Darlot Gold Mine

E37/1385, E37/1409, E37/1410, L37/0211, L37/0248, L37/0250, M37/0021,
M37/0067, M37/0076, M37/0090, M37/0179, M37/0201, M37/0222,
M37/0248, M37/0330, M37/0394, M37/0407, M37/0410, M37/0416,
M37/0429, M37/0449, M37/0451, M37/0457, M37/0496, M37/0529,
M37/0544, M37/0547, M37/0548, M37/0551, M37/0570, M37/0571,
M37/0572, M37/0573, M37/0574, M37/0905, M37/1050, M37/1051,
M37/1081, M37/1105, M37/1165, P37/9157, P37/9160, P37/9161,
P37/9270, P37/9271, P37/9281, P37/9282, P37/9283, P37/9284,
P37/9286, P37/9287, P37/9288, P37/9289, P37/9290, P37/9291,
P37/9293, P37/9294, P37/9295, P37/9392, P37/9393, P37/9394,
P37/9395, P37/9396, P37/9397, P37/9398, P37/9399, P37/9400,
P37/9401, P37/9402, P37/9403, P37/9404, P37/9405, P37/9406,
P37/9407, P37/9408, P37/9409, P37/9410, P37/9491, P37/9492

P37/9285, P37/9292, P37/9626

E36/0865, E36/0940, E36/0941, E36/0944, E36/0945, E36/0964, E36/0968,
E36/0969, E36/0980, E36/0997, E36/0999, E36/1002, E37/1054, E37/1194,
E37/1195, E37/1210, E37/1247, E37/1253, E37/1268, E37/1269, E37/1296,
E37/1297, E37/1298, E37/1319, E37/1321, E37/1322, E37/1350, E37/1352,
E37/1369, E37/1378, E37/1393, E37/1395, E37/1398, E37/1400, E37/1413,
E37/1415, E37/1428, G37/0037, L37/0118, L37/0206, L37/0207, L37/0223,
L37/0224, L37/0230, L37/0231, L37/0237, M37/0054, M37/0155,
M37/0252, M37/0373, M37/0417, M37/0418, M37/0419, M37/0420,
M37/0503, M37/0584, M37/0592, M37/0608, M37/0667, M37/0774,
M37/0775, M37/1217, P36/1879, P36/1883, P36/1884, P36/1889,
P36/1920, P37/8587, P37/8699, P37/8716, P37/8788, P37/8789,
P37/9210, P37/9345

E36/1027, L37/0238, P36/1921, P36/1931

E37/1220

E37/1271, E37/1272, E37/1273, E37/1274, E39/1706, E39/1854, E39/1985

Red 5 interest

100%

100% (Applications pending)

100%

100% (Applications pending)

Right to explore and mine
Sub-Lease Area

Farm-in agreement to earn up
to 80%

M37/0552, M37/0631, M37/0709, M37/1045

M37/0246, M37/0265, M37/0320, M37/0343, M37/0345, M37/0393,
M37/0776

30%

84%

M37/0421, M37/0632

Montague Project

M57/0429, M57/0485, E57/0793

100% with a portion of
tenements at 30% via
agreement

25% free carried

Abbreviations

M: Mining Lease

P: Prospecting Licence

E: Exploration Licence

L: Miscellaneous Licence

The Group divested its interests in the Siana gold project and the Mapawa gold project located in the Philippines, during the financial year.

2022 ANNUAL REPORT

DIRECTORS’ Report

The Directors of Red 5 Limited (“Red 5” or “parent entity”) submit
their report on the results and state of affairs of Red 5 and its
subsidiaries (“the Group” or the “consolidated entity”) for the year
ended 30 June 2022.

Mark Williams

Executive Director

Appointment
date

Non-Executive Director from January 2014
and Managing Director since April 2014

1. DIRECTORS AND

COMPANY SECRETARY

Special
responsibilities

Managing Director

Qualifications

Dip CSM Mining, GAICD

The names of the Directors of Red 5 in office during the course of
the financial year and at the date of this report are as follows:

Experience

Kevin Anthony Dundo
Mark James Williams
Ian Keith Macpherson
John Colin Loosemore
Steven Lloyd Tombs
Andrea Jane Sutton
Fiona Elizabeth Harris (appointed on 8 June 2022)

Unless otherwise indicated, all Directors held their position as a
Director throughout the entire financial period and up to the date
of this report.

1.1.

INFORMATION ON DIRECTORS

Kevin Dundo

Non-Executive Chairman

Appointment
date

Non-Executive Director since March 2010
and Non-Executive Chairman since
November 2013

Special
responsibilities

Member of the Remuneration and
Nomination Committee;

Member of the Audit Committee; and

Member of the Health, Safety and
Community Committee.

Mr Williams was previously General Manager
of the Tampakan Copper-Gold Project in the
southern Philippines from 2007 to 2013. He
has over 25 years’ of mining experience
operating within a diverse range of open cut,
underground, quarrying and civil engineering
environments across the developed markets
of Australia, United Kingdom and New
Zealand as well as the emerging markets of
Philippines, Vietnam, Thailand and South
Pacific.

Mr Williams has not held directorships in any
other listed companies in the past 3 years.

Other listed
company
directorships

Ian Macpherson

Non-Executive Director

Appointment
date

Special
responsibilities

April 2014

Chair of the Audit Committee;

Member of the Remuneration and
Nomination Committee; and

Member of the Risk and Environment
Committee.

Qualifications

B.Com, LLB, FCPA

Qualifications

B.Comm, CA

Experience

Other listed
company
directorships

Mr Dundo practices as a lawyer and
specialises in commercial and corporate
areas with experience in the mining sector,
the service industry and the financial
services industry.

Director of Imdex Limited
(since January 2004);

Avenira Limited (since October 2019); and

Cash Converters International Limited
(February 2015 to November 2020).

Experience

Other listed
company
directorships

Mr Macpherson is a Chartered Accountant
with over 35 years’ experience in the
provision of financial and corporate advisory
services. He was a former partner at Arthur
Andersen & Co managing a specialist
practice providing corporate and financial
advice to the mining and mineral exploration
industry. Mr Macpherson established Ord
Partners in 1990 (later to become Ord Nexia)
and has specialised in the area of corporate
advice with particular emphasis on capital
structuring, equity and debt raising,
corporate affairs and stock exchange
compliance for publicly listed companies.

Director of RBR Group Ltd (since October
2010).

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

1. DIRECTORS AND

COMPANY SECRETARY (cont.)

Colin Loosemore Non-Executive Director

Appointment
date

December 2014

Special
responsibilities

Chair of the Health, Safety and Community
Committee; and

Member of the Audit Committee.

Qualifications

B.Sc.Hons., M.Sc., DIC., FAusIMM

Experience

Mr Loosemore is a Geologist with over
40 years’ experience in multi-commodity
exploration including over 30 years as a
director of public exploration companies
within Australia and overseas. He graduated
from London University in 1970 and the Royal
School of Mines in 1977. Mr Loosemore was
most recently Managing Director of
Archipelago Resources plc where he oversaw
the development of the Toka Tindung Gold
Mine in Sulawesi, Indonesia.

Other listed
company
directorships

Mr Loosemore has not held directorships in
any other listed companies in the last 3
years.

Steven Tombs

Non-Executive Director

Appointment
date

August 2018

Special
responsibilities

Chair of the Remuneration and Nomination
Committee; and

Member of the Risk and Environment
Committee.

Qualifications

B.Sc.Hons, FAusIMM

Experience

Other listed
company
directorships

Mr Tombs is a Mining Engineer with over 40
years’ experience in the mining industry in
Australia and overseas. Mr Tombs graduated
from Nottingham University in 1976 and was
previously Red 5’s General Manager at Darlot
and the Underground Project Manager at
Siana. Mr Tombs previously held Senior
Management positions at AngloGold Ashanti,
Placer Dome and Newcrest in the Eastern
Goldfields.

Mr Tombs has not held directorships in any
other public companies in the last 3 years.

Andrea Sutton

Non-Executive Director

Appointment
date

November 2020

Special
responsibilities

Chair of the Risk and Environment
Committee; and

Member of the Health, Safety and
Community Committee.

Qualifications

B.Eng Chemical (Hons), GradDipEcon,
GAICD

Experience

Ms Sutton is a qualified Chemical Engineer
and has over 25 years’ experience with Rio
Tinto and ERA. Between 2013 and 2017, Ms
Sutton was Chief Executive and Managing
Director of ERA, then a Non-Executive
Director from 2018 to 2020. Ms Sutton had
extensive executive and operational
leadership roles across Rio Tinto. This
experience included Head of Health,
Environment, Safety and Security; General
Manager Operations at the Bengalla Mine
and General Manager of Infrastructure, Iron
Ore.

Other listed
company
directorships

Non-executive director of:

DDH1 Holdings Pty Ltd (since February
2021);

Iluka Resources Limited (since March 2021);
and

Energy Resources of Australia Ltd (October
2018 to May 2020).

Fiona Harris

Non-Executive Director

Appointment
date

June 2022

Special
responsibilities

Qualifications

B.Com, FCA, FAICD

Experience

Other listed
company
directorships

Ms Harris is a qualified Chartered Accountant
with over 25 years’ experience as a non-
executive director, including on a number of
internationally-focused listed energy and
natural resources companies. She is a former
WA State President and National Board
Member of the Australian Institute of
Company Directors, and is a member of
Chief Executive Women. Ms Harris was
previously a partner of chartered
accountants, KPMG.

Non-executive director of:

BWP Trust (since October 2012);

Oil Search Ltd (January 2017 to December
2021).

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

1. DIRECTORS AND COMPANY SECRETARY (cont.)
1.2.

INFORMATION ON COMPANY SECRETARY

Frank Campagna

Appointment date

Qualifications

Experience

Company Secretary

June 2002

B.Bus (Acc), CPA

Mr Campagna is a Certified Practicing Accountant with over 25 years’ experience as Company
Secretary, Chief Financial Officer and Commercial Manager for listed resources and industrial
companies. He presently operates a corporate consultancy practice that provides corporate
secretarial and advisory services to listed and unlisted companies.

1.3. DETAILS OF DIRECTORS’ INTERESTS IN THE SECURITIES OF RED 5

AS AT THE DATE OF THIS REPORT ARE AS FOLLOWS:

Director

Kevin Dundo

Mark Williams

Ian Macpherson

Colin Loosemore

Steven Tombs

Andrea Sutton

Fiona Harris

Fully paid shares

Performance rights

Service rights

Deferred rights

1,905,249

15,860,891

1,580,000

10,108,190

2,719,579

5,303,575

1.4. DIRECTOR’S MEETINGS

The number of meetings of the Board of Directors of Red 5 and of each Board committee held during the year ended 30 June 2022 and
the number of meetings attended by each Director whilst in office are as follows:

Board
meetings

Audit
Committee

Remuneration
& Nomination
Committee

Risk & Environment
Committee

Health, Safety
& Community
Committee

Director

Eligible

Attended

Eligible

Attended

Eligible

Attended

Eligible

Attended

Eligible

Attended

Kevin Dundo

Mark Williams

Ian Macpherson

Colin Loosemore

Steven Tombs

Andrea Sutton

Fiona Harris

2. PRINCIPAL ACTIVITIES
The principal activities of Red 5 and the consolidated entity (which includes associated entities of Red 5) during the financial period
were gold mining and mineral exploration.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

3. RESULTS OF OPERATIONS
The consolidated result for Red 5 Limited was a net loss after
income tax for the year ended 30 June 2022 of $28,615,000 (2021:
Loss of $43,245,000). The consolidated result incorporates two
one-off adjustments:

1. With the Darlot underground transitioning to a satellite mine

providing ore to King of the Hills, accelerated depreciation and
impairments for the Darlot Process Plant (now in care and
maintenance) totalled $22.585 million.

2. Completing the Siana Gold Mine divestment resulted in a gain

from discontinued operations of $20.049 million.

The current year results include an unaudited underlying EBITDA (a)
loss of $4,258,000 (2021: Profit of $11,635,000).

30 June 2022

30 June 2021

$’000

164,962

$’000

173,358

(153,934)

(147,848)

208

692

Sales revenue

Cost of sales (excluding
depreciation)

Other income

Administration and other
expenses (excluding
depreciation)

Care and maintenance
(excluding depreciation)

Exploration expenditure

Underlying EBITDA

3.1 OPERATING REVIEW

Red 5, with the support of its EPC partner MACA Interquip,
completed construction of Red 5’s new King of the Hills Gold Mine
(KOTH) within budget and on schedule, with the first gold pour on
5 June 2022.

Meanwhile, Red 5 delivered steady-state gold production from its
Darlot Gold Mine, with ore sourced from the Darlot underground
mine and Great Western satellite open pit mine. In July 2022, the
Darlot process plant was placed into care and maintenance, with
the Darlot underground mine transitioning to a satellite mine to
King of the Hills.

(a) Covid-19 response

Red 5 continues to manage and mitigate the potential impact of
the COVID-19 global pandemic on the Company’s operations. The
Management Response Plan remains focused on ensuring the
health and safety of Red 5 personnel and limiting the disruption
risk to our operations.

(12,972)

(9,281)

(2,522)

(4,258)

(2,069)

(3,217)

11,635

The Company continues to closely monitor the advice and
requirements from State and Federal Governments and health
authorities and maintain its focus on minimising the effects of
COVID-19 on the health and well-being of staff and the
communities in which we operate.

(a) Underlying earnings before interest, taxes, depreciation and

(b) Construction of the King of the Hills

amortisation (EBITDA) is an unaudited non - IFRS measure and is
a common measure used to assess profitability before the impact
of different financing methods, income taxes, depreciation of
property, plant and equipment and amortisation of intangible
assets, fair value movements and ineffective cashflow hedges.

The underlying EBITDA reconciles to the profit/(loss) before tax as
follows:

Underlying EBITDA

Financing income

Financing expenses

Ineffective portion of cashflow
hedges

Depreciation and
amortisation

(Loss)/profit from
continuing operations
before income tax expense

30 June 2022

30 June 2021

$’000

(4,258)

(2,815)

$’000

11,635

347

(1,345)

(1,410)

(42,514)

(23,493)

(49,579)

(14,266)

(KOTH) project

FY22 marked a defining period in Red 5’s growth pathway to
becoming a mid-tier Australian gold producer with the
construction of the KOTH project. First gold at KOTH was
achieved on 5 June 2022, with construction completed on time
and on budget. This was achieved despite a very challenging
operating environment due to COVID-19, closed borders and
disruptions to both global supply chains and local labour markets.

The new 4.7Mtpa process plant is now commissioned and
ramping up towards full production. The SAG mill is currently
operating at moderate load and power draw, which is indicative of
the potential of this low-cost processing hub.

The open pit and underground mines are both operational and are
delivering ore to the process plant. Deliveries of ore from the
Darlot satellite underground mine began in August 2022, and the
processing plant is ramping up towards the target throughput of
4.7Mtpa. There is a significant amount of ore on the KOTH ROM
pad, representing approximately three months of production.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

3. RESULTS OF OPERATIONS (cont.)
3.1 OPERATING REVIEW (cont.)

A total of 66,871 ounces of gold was recovered for the 12 months
to 30 June 2022, with ore predominantly sourced from the Darlot
and Great Western gold mines. Darlot achieved its production
guidance for FY22.

A summary of key production statistics for the year ended 30 June
2022 and 30 June 2021 is provided below:

Year ended

Units

30 June 2022

30 June 2021

Mined tonnes

Mined grade

Tonnes milled

Average head grade

Recovery

Gold recovered

Gold operational sales

g/t

2,660,914

931,002

1.15

2.57

1,359,974

984,220

1.66

92.1

66,871

64,315

2.63

91.5

76,104

75,907

In July 2022, the Darlot Gold Mine has transitioned to a satellite
underground mine to King of the Hills, with the majority of surface
employees at Darlot transitioning or having already transitioned to
King of the Hills. As a result, the Darlot process plant has been
placed into care and maintenance. Following a review of the
related assets at Darlot, one-off accelerated depreciation and
inventory write-downs totalling $22.585 million have been applied
in FY22.

(d)

Siana Gold Project, Philippines

In July 2021, the Group entered into a binding agreement with TVI
Resource Development (Phils) Inc to divest its interests in
Philippine-affiliated company, Greenstone Resources Corporation
(GRC), which holds the Siana Gold Project and the Mapawa Gold
Project in the Philippines. Financial close on this transaction was
achieved in September 2021. These transactions have been
classified as discontinued for the purpose of the financial
statements.

(e)

Exploration and Resource Development

During FY2022, results were reported for drilling completed at the
Darlot Underground Mine, delivering high-grade results from
multiple locations. The drilling forms part of an ongoing
exploration and Resource development program at Darlot focused
on extending new mining areas such as Middle Walters South and
reducing the dependency on remnant mining. Results reported
included strong intercepts from Middle Waters South and positive
results from Dar-Cent, Oval 1300 and Pedersen Lower, all of which
offer the opportunity for Resource growth. Full details of the
drilling and assay results were provided in the Company’s ASX
Announcement dated 22 February 2022.

Darlot also commenced drilling as part of the government-funded
Exploration Incentive Scheme (EIS) hole (CAX0075) which
commenced in the June Quarter. The hole is designed primarily to
target the Pipeline Fault to the south of the underground workings
proximal to an interpreted jog or zone of flattening. This change in
geometry could generate a favourable dilation and mineralisation
site. The hole also intersects the Lords Fault enroute to target,
with the nearest existing drill hole approximately 350 metres north
of the target area.

For regional exploration, the Exploration team focused on several
geochemical surveys utilising a Portable X-ray analysis tool across
the exploration tenements. Upon completion of this work, the
team used the results to refine existing programs and identified
additional grass root targets.

(f)

Corporate

During the year, the Group drew down all of the $175 million debt
funding package supporting the construction and development of
King of the Hills. Repayments of the debt funding package will
commence in December 2022 over four years. Borrowing
establishment costs of $2.730 million were capitalised to the loan.

Ms Fiona Harris AM was appointed as a Non-Executive Director of
the Board, effective from 8 June 2022.

Red 5 has appointed Mr Patrick Duffy as Chief Financial Officer of
the Company, effective from 1 September 2022. Mr Duffy is
currently Red 5’s Chief Corporate Development Officer, and this
role will be consolidated with the CFO position.

Consideration under the transaction was as follows:

\ US$19 million cash (approximately A$25.3 million) paid upon

3.2 FINANCIAL REVIEW

completion; and

(a) Gold sales

\ Net Smelter Return royalty of 3.25% payable for up to 619,000
ounces of gold, with an estimated future face value of US$36
million (based on a US$1,800/oz gold price). As per the
accounting standards, the royalty represents a variable
consideration and is treated as a contingent asset pending
re-commencement of production at Siana, hence royalty
accounting value is not recorded as at 30 June 2022.

The completion of the divestment in the Siana Gold Mine resulted
in a gain from discontinued operations of $20.049 million in FY22.

Gold and silver sales for the reporting period totalled
$164,962,000 with 64,315 gold ounces sold at an average price of
$2,526 per ounce (2021: $173,358,000 with 75,907 gold ounces
sold at an average price of $2,252 per ounce).

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

3. RESULTS OF OPERATIONS (cont.)
3.2 FINANCIAL REVIEW (cont.)
(b)

Income statement

The Group recorded a net loss after tax for the year ended
30 June 2022 of $28,615,000 in comparison to a net loss after tax
for the year ended 30 June 2021 of $43,245,000. The consolidated
result incorporates two one-off adjustments:

1. With the Darlot underground transitioning to a satellite mine

providing ore to King of the Hills, accelerated depreciation and
inventory write-down for the Darlot Process Plant (now in care
and maintenance) totalled $22.585 million in FY22.

2. The completion of the divestment in the Siana Gold Mine

resulted in a gain from discontinued operations of $20.049
million.

64,315 ounces of gold was sold during the year, predominantly
from the Darlot operation, which, together with silver sales and
hedging adjustments, resulted in total revenue of $164,962,000.

Cost of sales for the period of $196,049,000 comprised
production costs, royalties, movement in stockpiles and
depreciation charges (including the $22,585,000 relating to Darlot
accelerated depreciation and inventory write-down).

Total assets increased from $345,485,000 to $577,365,000 at 30
June 2022. The net increase in total assets was driven by the
construction of the KOTH processing plant and related
infrastructure, mine development and right of use assets
associated with major contracts.

Total liabilities were $394,570,000, an increase of $279,961,000
from 30 June 2021. This was mainly driven by fully drawing down
the KOTH construction facility of $175,000,000 and the
recognition of right-of-use lease liabilities at KOTH of
$96,098,000.

(d) Cash flow

During the year, cash and cash equivalents increased by
$14,398,000.

Net cash outflows from operating activities for the period were
$2,359,000. Cash receipts from customers of $158,606,000 reflect
the sale of gold and silver, which benefited from higher gold prices
during the year. This was offset by cash outflows of $160,695,000,
driven by operational spending at Darlot and Great Western,
exploration activities and interest payments.

Net cash outflows used in investing activities for the period were
$160,104,000, reflecting the completed construction of the King of
the Hills processing plant ($94,844,000) and mine development
activities ($82,729,000). This was partially offset by proceeds from
selling the Siana operation in the Philippines ($21,467,000).

The net cash from financing activities of $176,861,000 reflects
the net proceeds received from the construction facility
($175,000,000) and the transfer of $13,000,000 from restricted
cash for the construction of the new tailings storage facility at
King of the Hills. This is offset by payments made on lease
liabilities ($8,409,000) and debt establishment and interest
costs ($2,730,000).

4. DIVIDENDS

No amounts were paid by way of dividends since the end of
the previous financial year (2021: Nil). At the time of this report,
the Directors do not recommend the payment of a dividend.

5. OPTIONS GRANTED OVER SHARES
No options were granted during or since the end of the financial
year. No person entitled to exercise the options has any right by
virtue of the option to participate in any share issue of Red 5 or
any other corporation.

6. PERFORMANCE RIGHTS
At the date of this report, there were 37,906,342 performance
rights convertible into ordinary fully paid shares.

Vesting date: 30 June 2023 (LTIP rights
subject to performance conditions)

Vesting date: 30 June 2023 (PIO rights
subject to performance conditions)

Vesting date: 30 June 2024 (LTIP rights
subject to performance conditions)

Number

7,945,729

11,550,613

18,410,000

37,906,342

In December 2019, a total of 10,442,031 performance rights
(Performance Rights) that were issued to key management
personnel, senior management and operating personnel were
vested following the partial achievement of performance
conditions (being Total Shareholder Return outperformance
against the All Ordinaries Gold Index and increases in ore
reserves), measured over the three years ended 30 June 2022.

Upon vesting, 5,576,211 Performance Rights have been exercised
into an equivalent number of ordinary fully paid shares in
accordance with the terms of the Plan. The balance of 4,865,820
Performance Rights were forfeited due to performance conditions
not being met (being operating costs performance against budget
and safety compliance) and personnel exiting the company during
the performance period.

INDEMNIFICATION AND
INSURANCE OF DIRECTORS,
OFFICERS

The Company has made an agreement indemnifying all the
Directors and officers of the Company against all losses or
liabilities incurred by each Director or officer in their capacity as
Directors or officers of the Company to the extent permitted by
the Corporations Act 2001. The indemnification specifically
excludes wilful acts of negligence. The Company paid insurance
premiums in respect of Director’s and Officer’ Liability Insurance
contracts for current officers of the Company, including officers of
the Company’s controlled entities. The liabilities insured are
damages and legal costs that may be incurred in defending civil or
criminal proceedings that may be brought against the officers in
their capacity as officers of entities in the Group. During the
financial year, Red 5 paid premiums of $459,687 (2021: $318,825).

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

8. EVENTS SUBSEQUENT TO THE

END OF THE FINANCIAL YEAR
In the first quarter of FY23, the Darlot Gold Mine’s processing
plant was wound down and the Darlot operation has been
transitioned to a satellite underground mine to provide ore to King
of the Hills, with the majority of surface employees at Darlot
transitioning or having already transitioned to King of the Hills. As
a result, the Darlot process plant was placed into care and
maintenance in July 2022.

Other than the matters discussed above, there has not arisen in
the interval between the end of the financial year and the date of
this report any item, transaction or event of a material and unusual
nature likely, in the opinion of the directors of the Company, to
significantly affect the operations of the Group, the results of
those operations, or the state of affairs of the Group, in future
financial years.

LIKELY DEVELOPMENTS
AND EXPECTED RESULTS
OF OPERATIONS

In the opinion of the Directors, the successful completion of the
KOTH Project will transform the future operating and financial
performance of the Group. In the first half of FY23, KOTH is
expected to steadily ramp up to full commercial production and
deliver a step-change in operational performance and cost
efficiency. This will establish a stable platform for continued
growth and development at Red 5 well into the future.

10. BUSINESS STRATEGY AND

PROSPECTS FOR FUTURE YEARS

Business strategy

The Group’s business strategy is firmly anchored in the Company
vision of being a successful multi-operational exploration and
mining company, providing benefits to all stakeholders, through
the consistent application of technical excellence, and responsible
and sustainable industry practices.

With KOTH gold production ramping up in the first half of FY23,
the Company is looking forward to another transformational year
as it takes further important steps to deliver on its strategy of
becoming a substantial Australian gold producer. To achieve the
strategy, the Company will focus on:

\ Unlocking the full potential of the KOTH operation;

\ Attracting and retaining an experienced leadership and

operating team; and

\ Enhancing balance sheet strength and scale to achieve
growth through economic and commodity price cycles.

The substantial KOTH mineral resource and reserves underpin the
future of Red 5, with the large KOTH bulk open pit providing the
primary feed to the KOTH process plant, complemented by the
additional higher-grade ore sources from the KOTH and Darlot
underground mines. The longer-term strategy at KOTH is to
expand the processing capacity, and to this end, the Company will
embark on targeted technical studies to optimise and realise the
full potential of this long-life deposit. The business plans
associated with the strategy are in place, and the LOM plans
demonstrate very robust future cash flows. The positive cash flow
generated over a 16-year mine life will position the Company in the
future to evaluate and undertake strategic acquisitions that align
with the goal of becoming a major regional gold producer.

Material Business Risks

Red 5’s business, operating and financial results and performance
are subject to various risks and uncertainties, some of which are
beyond the Company’s reasonable control. Set out below are
matters which the Directors consider relevant and that have the
potential to impact the achievement of the business strategies.
The matters identified are not necessarily listed in order of
importance and are not intended as an exhaustive list of all
business risks and uncertainties.

External economic drivers (including macroeconomic,
metal prices and exchange rates)

\ The Company is exposed to fluctuations in the Australian

dollar gold price, which can impact future revenue streams. As
a mitigation, the Company has a partial gold price hedging
program to assist in offsetting variations in the Australian
dollar gold price, providing price certainty over a fixed portion
of future production.

\ The Company is exposed to global inflationary pressures

across a range of input costs such as oil and gas, operating
and maintenance parts and consumables and labour. As a
mitigation the company collaborates with its suppliers to
identify ways to manage these cost pressures.

Reserves and Resources:

\ The Mineral Resources and Ore Reserves for the Group’s
assets are estimates only in compliance with industry
standards, and no assurance can be given that future
production will achieve the expected tonnages and grades.

2022 ANNUAL REPORT

Capital and Liquidity

\ The Company has processes in place to monitor and manage
its liquidity and capital structure to ensure sufficient funds are
available to meet the Group’s financial commitments. Red 5
has a single debt facility with external financiers.

Health and Safety

\ Red 5 has implemented management systems which promote
a strong safety culture and support a genuine commitment to
keep its people and stakeholders safe and healthy. The
Company’s safety management practices are focused on a
bottom-up approach supporting the organisational values.

Environmental

\ The Company has environmental liabilities associated with its
tenements. The Company monitors its ongoing environmental
obligations and risks and implements preventative,
rehabilitation and corrective actions as appropriate.

Community relations

\ Red 5 has an established community relations function that
includes principles, policies and procedures designed to
provide a structured and consistent approach to community
activities. Red 5 recognises that a failure to manage local
community stakeholder expectations appropriately may lead
to dissatisfaction, potentially disrupting production and
exploration activities.

11. ENVIRONMENTAL REGULATIONS
The consolidated entity is subject to significant environmental
regulation in respect to its mineral exploration activities. These
obligations are regulated under relevant government authorities
within Australia. The consolidated entity is a party to exploration
and development licences and has beneficial interests in Mineral
Production Sharing Agreements. Generally, these licences and
agreements specify the environmental regulations applicable to
exploration and mining operations in the respective jurisdictions.
The consolidated entity aims to ensure that it complies with the
identified regulatory requirements in each jurisdiction in which it
operates.

Compliance with environmental obligations is monitored by the
Risk and Environment Committee. There have been no significant
environmental breaches during the year ended 30 June 2022.

DIRECTORS’ Report (cont.)

10. BUSINESS STRATEGY
AND PROSPECTS FOR
FUTURE YEARS (cont.)

Operational risks:

\ Drilling, mining and processing activities carry risk and as

such, activities may be curtailed, delayed or cancelled as a
result of a number of factors outside the Company’s control.
These include geological conditions, technical difficulties,
securing and maintaining tenements, weather, residue storage
and tailings storage facility failures and construction of
efficient processing facilities. The operation may be affected
by force majeure, fires, labour disruptions and availability,
landslides, the inability to obtain adequate machinery,
engineering difficulties and other unforeseen events. As with
most mines, reserves, resources and stockpiles are based on
estimates of grade, volume and tonnage. The accuracy and
precision of these estimates will depend upon drill spacing
and other information such as continuity, geology, rock
density, metallurgical characteristics, mining dilution and
costs, etc. which evolve as the mine moves through different
parts of the ore body. Red 5 endeavours to take appropriate
action to mitigate these operational risks (including by
properly documenting arrangements with counterparties and
adopting industry best practice policies and procedures) or to
insure against them, but the occurrence of any one or a
combination of these events may have a material adverse
effect on the Company’s performance and the value of its
assets.

COVID-19

\ Red 5 has continued to manage the Company’s ongoing

response to COVID-19 in cooperation with our contractors.
The COVID-19 situation remains unpredictable, and the
Company will continue to monitor and manage for potential
impacts, particularly around labour availability.

\ The Company is maintaining a range of measures across its

business consistent with advice from State and Federal health
authorities and commensurate with the community risk profile.
These measures help ensure the health and welfare of our
employees and their respective communities.

Legal compliance and maintaining title

\ The Company has systems and processes in place to ensure

title to all its properties, but these can be subject to dispute or
unforeseen regulatory changes.

Climate Change

\ Changes to climate-related regulations and government policy
have the potential to impact our future financial results. These
changes may include the imposition of a carbon tax on carbon
output or the implementation of new regulatory requirements
for diesel or other fossil fuel consumption used in Red 5’s
operations.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT
LETTER FROM THE CHAIRMAN OF BOARD

Dear shareholders

I am pleased to present Red 5’s Remuneration Report for the Financial Year to 30 June 2022 (FY22).

FY22 Performance Summary

The last 12 months has seen Red 5 navigate through the enduring impact from the COVID-19 pandemic, chronic labour skill
shortages and global breakdown in the supply chain of key parts and spares.

Despite these challenges, Red 5 has achieved significant milestones over the year including successful commencement on time
and budget of the KOTH mine, and meeting the production guidance for the Darlot mine. These outcomes translated to significant
share price out-performance (see Chart 1) and assured enduring organisation capability key to the sustainable growth of Red 5
and ongoing value to shareholders.

Chart 1: Red 5’s share price performance vs. All Ordinaries Gold Index over the past 12 months

RED 5

All Ordinaries Gold Index

Jun 2021

Aug 2021

Oct 2021

Dec 2021

Feb 2022

Apr 2022

160%

120%

40%

32%

-25%

-40%

Jun 2022

Remuneration Outcomes

When determining the FY22 remuneration outcomes, the Board
has carefully considered the achievements made over the year
in combination with the unforeseen factors that have impacted
the Company. The Board believes the outcomes (as outlined
below) are reasonable as they provide appropriate alignment
between executive performance, shareholder returns and
recognition of executive retention criticality over the next
business phase. Refer to Section 12.5 for further details.

\ Total Fixed Remuneration (TFR): the TFR for Managing

Director and Chief Financial Officer (CFO) increased by 7%
(from $643,200 to $687,500) and 6% (from $415,388 to
$440,000) over the year. The TFR adjustments were
considered necessary to ensure market competitiveness
based on external remuneration benchmarking analysis.

\ Short Term Incentive Plan (STI): while the production

gateway was not met, the Board exercised its discretion to
award 50% STI outcomes to executives which were settled
in Service Rights subject to continued employment. This
decision recognises the magnitude of external unforeseen
factors outside of management’s control which have
influenced the production gateway and other STI metrics
such as all in sustaining costs. Refer to Section 11.5.2 for
further details.

\ Long Term Incentive Plan (LTI): Red 5’s total shareholder
return over the past three years (19.92%) represents
significant outperformance against the S&P/ASX All
Ordinaries Gold Index (-10.98%). Ore reserves over the
same period have grown by well over 200%. Achieving
stretch levels in these two metrics has resulted in 70% of
FY20 LTI awards vesting in FY22. Refer to Section 11.5.3
for further details.

\ NED Fees: there were no increases to the NED fees in

FY22.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

Changes to the Remuneration Framework

The Board regularly reviews our executive remuneration structure
to ensure it continues to drive shareholder value and enables us to
attract and retain the talent we need. As we embed our new
flagship KOTH mine, the Board has decided to adopt changes to
our remuneration arrangements to further strengthen the
alignment of executives with key business imperatives and
ensuring a focus on long-term sustainability of returns for
shareholders. These changes are summarised below. Refer to
Section 11.7 for details.

FY22 - Discontinue the Project Incentive Opportunity (PIO)

The PIO was implemented in FY22 as a one-off program at a
critical stage of the business, specifically designed to align CEO
and executives on delivering the flagship KOTH project and
achieving production targets at the Darlot site. With KOTH now
successfully commissioned, outcomes of the PIO metrics will be
evaluated after 30 June 2023 being the end of the performance
period. The performance achievements and any vesting outcomes
will be provided in the 2024 Remuneration Report.

FY23 – Rebalance the pay mix for the CEO and executives

Recognising Red 5’s growth as a gold producer and alignment
with market peers, the Board has rebalanced the pay mix to
enhance the focus of executives over the longer term. This will see
CEO and executives remuneration mix decrease in weighting for
annual incentives (STI) and increase in weighting for long term
incentives (LTI).

FY23 – Simplify the deferred equity structure and
rebalance performance measures for STI

STI outcomes for the CEO and executives will continue to be
delivered in 50% cash and 50% deferred equity, comprising
Service Rights. To simplify and align with contemporary market
practice, the deferred equity structure will be in the form of
service-based rights only which may vest subject to 12 month
continued employment. Previously it was in the form of both

service-based and deferred rights. Short term metrics
linked to the STI will also be rebalanced to equal weightings
across all short term key performance indicators.

FY23 - Remove the re-testing mechanism and
production gateway from the LTI

The re-testing mechanism for the relative Total Shareholder
Return (TSR) vesting hurdle will be removed, based on
misalignment with market practice and shareholder views.
Whilst the positive TSR gateway will remain, the Board has
determined the production gateway is no longer appropriate
for the LTI. This change recognises production performance
continues to be a key metric for the STI and the positive
TSR gateway requirement on the LTI is sufficient to ensure
appropriate outcomes for executives are also in the
interests of shareholders.

The Board is confident that Red 5’s current and planned
remuneration policies continue to support the financial and
strategic goals of the business as a leading gold producer.
We are committed to transparency and an ongoing dialogue
with shareholders on remuneration and to this end we have
made changes to the 2022 Remuneration Report to improve
the overall format and flow of information.

On behalf of the Board, I invite you to review the full report
and thank you for your continued support of Red 5.

Sincerely

Kevin Dundo
Chairman

TABLE OF CONTENTS

This Remuneration Report (Report) outlines the remuneration arrangements in place for key management personnel (KMP) of
Red 5 Limited (Red 5 or the Company) for the year ended 30 June 2022 (FY22) in accordance with the requirements of the
Corporations Act 2001 and its Regulations. The Report contains the following main sections:

12.1 Who is covered by this Remuneration Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

12.2 Remuneration Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

12.3

Principles of Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

12.4

Executive Remuneration Framework and Components . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

12.5

FY22 Executive Remuneration Outcomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

12.6 Non-Executive Directors’ Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

12.7

Planned Remuneration Approach for FY23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

12.8 Details of Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

12.9

Additional Remuneration Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.1 WHO IS COVERED BY THIS REMUNERATION REPORT

For the purposes of this Report, KMP are defined as those persons having authority and responsibility for planning, directing and
controlling the major activities of the consolidated entity, including any Director (whether Executive KMP or Non-Executive Director
(NED)) of Red 5.

The following were the KMP of the Company at any time during the year ended 30 June 2022 and unless otherwise indicated, KMP for
the entire period:

Name

Executive Director

Mark Williams

Current Executive KMP

Jason Grieve

John Tasovac

Non-Executive Directors

Kevin Dundo

Ian Macpherson

Colin Loosemore

Steven Tombs

Andrea Sutton

Fiona Harris

Position

Term as KMP

Managing Director

Chief Operating Officer

Chief Financial Officer

Chairman, Independent Non-Executive Director

Independent Non-Executive Director

Full year

Independent Non-Executive Director

Appointed on 8 June 2022

12.2 REMUNERATION GOVERNANCE

KMP remuneration decision making is directed by Red 5’s remuneration governance framework as follows:

Board

Take an active role in the governance and oversight of Red 5’s remuneration policies and have
overall responsibility for ensuring that the Company’s remuneration strategy aligns with Red 5’s
short- and long-term business objectives and risk profile.

Remuneration Committee
(Committee)

Responsible for reviewing the remuneration arrangements for KMP and make recommendations to
the Board including:

\ reviewing remuneration levels and other terms of employment on an annual basis having
regard to relevant market conditions, qualifications and experience of the KMP, and
performance against targets set for each year where applicable.

\ advising the Board on the appropriateness of remuneration packages / structures of the

Company, given trends in comparative peer companies both locally and internationally, with
the overall objective of ensuring maximum stakeholder benefit from the retention of a high
calibre Board and executive team.

The Committee’s charter can be found on the Company’s website at:
www.red5limited.com/site/about-red5/corporate-governance

External Remuneration
Consultants

To ensure the Committee is fully informed when making remuneration decisions, it may seek
external, independent remuneration advice on remuneration related issues.

Share trading policy

During the year, the Committee engaged consultants BDO Rewards and The Reward Practice Pty
Ltd to provide remuneration services in respect to external benchmarking and general insights for
executive incentive arrangements. During the period no remuneration recommendations, as
defined by the Corporations Act, were provided by the consultants.

Red 5’s share trading policy prohibits KMP (that are granted share-based payments as part of their
remuneration) from entering into other arrangements that limit their exposure to losses that would
result from share price decreases. Entering into such arrangements is also prohibited by law.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.3 PRINCIPLES OF REMUNERATION

Four principles guide Red 5’s remuneration policies and practices:

Remuneration quantum
should target the middle to
upper quartile of the market
that Red 5 operates in to
attract and retain the key
talent required.

At-risk reward should be
based on the achievement of
challenging targets over the
short term (1 year) and long
term (3 years +).

Emphasis of reward
programs should be to
motivate and retain key
talent over the long term.

An appropriate mix of cash
and equity awards so that
over time executives and
employees are aligned
with the long-term interests
of shareholders.

Note NEDs do not receive remuneration related to performance or participate in any incentive plans.

12.4 EXECUTIVE REMUNERATION FRAMEWORK AND COMPONENTS

Executives receive fixed remuneration and variable remuneration consisting of short and long term incentive opportunities. Executive
remuneration levels are reviewed annually by the Remuneration Committee with reference to the remuneration guiding principles and
market movements.

The following diagram presents a high-level summary of remuneration components for executive KMP for FY22.

Fixed remuneration

Base salary + superannuation + benefits

Variable remuneration

STI Plan

LTI Plan

Cash

Service Rights
(1 year)

Deferred Rights
(1 year)

Rights (3 years)

50% financial performance
50% non-financial performance

70% relative TSR
30% growth in reserves

One- off incentive

Project Incentive Opportunity
(PIO)

Performance Rights
(2 years)

50% gold production
25% ore processed
25% development metres

In addition, various minimum gateways are in place that need to be achieved in order to be awarded the variable remuneration
component.

The following diagram sets out the mix for fixed and “at risk” remuneration for executive KMP at maximum opportunity level for FY22
based on the potential of a 100% vesting of STI and LTI. Note given the one-off nature of the PIO it is excluded from the remuneration
mix analysis.

2022 Remuneration Mix (at Maximum Opportunity)

Managing
Director

42%

26%

32%

58%

Total at risk

Other KMP’s

60%

27%

13%

40%

50%

100%

Fixed

STI (at risk)

LTI (at risk)

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.4 EXECUTIVE REMUNERATION FRAMEWORK AND COMPONENTS (cont.)

Fixed remuneration

Fixed remuneration consists of base salary, superannuation and optional salary sacrifice benefits.

It is designed to recognise the execution of business strategy and the qualifications, experience and accountability of executives.

It is set with reference to comparable roles in similar companies.

STI

The following table outlines the FY22 STI arrangements in detail:

What is the purpose?

\ Reward executive KMP for the achievement of Red 5’s annual targets linked to business

strategy and shareholder value;

\ Ensure that executives have commonly shared objectives related to the delivery of annual

business plans;

\ Encourage share ownership among senior roles; and

\ Provide a component of remuneration to enable the Company to compete effectively for the

calibre of talent required for it to be successful, on a short to medium term basis.

STI awards are paid in 50% cash and 50% equity following the conclusion of performance
period. The 50% equity component is to be satisfied in 25% Service Rights (subject to 12
month continued service) and 25% Deferred Rights (which vest immediately into restricted
shares which are subject to a 2 year disposal restriction).

How is it paid?

What is the target incentive
opportunity?

STI opportunity is set as a percentage of TFR. Subject to performance, the MD was entitled to
an opportunity of up to 60% and other executive KMP were entitled to an opportunity of up to
50%.

What is the performance period?

The STI is offered annually and is measured over a single financial year.

How is performance assessed?

An executive’s actual award is based on meeting KPIs set in advance of the financial year. The
KPIs comprise financial and non-financial objectives which directly align the individual’s reward
to the Company’s annual business plans. The KPIs set for the FY22 awards were:

\ Company Financial: budgeted EBITDA (30%)

\ Gold production: across both Darlot and KOTH (20%)

\ Safety: assessed by Total Recordable Injury Frequency Rate (TRIFR) and no fatalities (20%)

\ Cost management: via All-in-Sustaining-Cost (AISC) per ounce (20%)

\ Individual effectiveness: measured by Board or Managing Director (where applicable) (10%)

KPIs are set at threshold, target, and stretch levels resulting in payout at 50%, 100% and 200%
of target opportunity.

What is the gateway?

An overall gateway of 90% of budgeted gold production level must be achieved before any
award is made under the STI.

What vesting conditions / dealing
restrictions apply to the equity
components of the STI award?

The Service and Deferred Rights granted following the performance period based on KPI
outcomes and are intended to prevent the equity being sold for a period of 12 and 24 months
respectively.

\ Service Rights (50% of the equity component) vest into shares 12 months after the grant
date based on continued employment with the Company (no further restriction period
applies following the vesting);

\ Deferred Rights (50% of the equity component) vest immediately into restricted shares
which are subject to dealing restrictions for 24 months after the performance period.

The purpose of deferral / restrictions is to manage the risk of short-termism inherent in setting
short term objectives, promote sustainable value creation and build further alignment with
shareholder interest.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.4 EXECUTIVE REMUNERATION FRAMEWORK AND COMPONENTS (cont.)

LTI

The following table outlines the FY22 LTI arrangements in detail:

What is the purpose?

\ To promote the alignment of interest between executives and shareholders through

the holding of equity. As such, LTI awards are generally granted to executives and
management who are able to influence the future of Red 5, and/or in a position to
contribute to shareholder wealth creation;

\ Ensure that executives have commonly shared goals related to producing relatively

high return for shareholders;

\ Encourage share ownership among senior roles;

\ Provide a component of remuneration to enable the Company to compete effectively
for the calibre of talent required for it to be successful on a long-term basis; and

\ Help retain employees, thereby minimising turnover and providing a stable workforce.

How is it paid?

LTI awards are paid in Performance Rights for nil cash consideration.

What is the LTI opportunity

The LTI opportunity is set as a percentage of TFR. Subject to performance the MD was
entitled to an opportunity of up to 60% and other executive KMP were entitled to an
opportunity of up to 45%.

What is the performance period

The LTI is considered annually and is measured over a 3-year performance period.

How is performance assessed?

LTI awards are granted at the beginning of performance period and vest based on:

\ Total Shareholder Return (TSR) compared to that of S&P/ASX All Ordinaries Gold

Index (70%); and

\ Growth of the Company’s proved and probable ore reserves (30%).

Retesting after 12 months (following the end of performance period) is available on the
relative TSR hurdle.

What is the gateway?

The following gateways must be satisfied in order for the awards to vest:

How the LTI vesting is determined?

LTI vesting is subject to the following sliding scale:

\ A positive TSR; and

\ 90% budgeted gold production level.

Relative TSR (70%)

Performance level to be achieved

Percentage vesting

=< S&P/ASX All Ordinaries Gold Index (Index)

Target: Outperform the Index by 10%

50%

Performance between Target and Stretch

Sliding scale vesting

Stretch: Outperform the Index by 20%

100%

Growth in ore reserves (30%)

Performance level to be achieved

Percentage vesting

<15%

Threshold =15%

Target = 20%

Stretch = > 35%

25%

50%

100%

What are the restrictions of the equity
components of the LTI awards?

There are no further restrictions to the vested awards following the end of the
performance period.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.4 EXECUTIVE REMUNERATION FRAMEWORK AND COMPONENTS (cont.)

12.4.1 One-off Project Incentive Opportunity (PIO)

The PIO is a one-off incentive designed specifically to support the successful development of the KOTH project and broader production
based objectives and help mitigate retention and attraction risks for executives and other critical employees.

PIO awards were offered at the start of FY22 and are to be delivered in 60% cash and 40% Performance Rights subject to performance
assessment (including continued employment) at 30 June 2023 in consideration of the following project metrics:

\ Gold produced (50%): based on a specified number of gold ounces produced across both the KOTH and Darlot mines based on

budgeted production schedules;

\ Ore processed (25%): based on a specified volume of ore processed at the KOTH processing plant based on forecast mining

schedules; and

\ Development metres (25%): based on a specified volume of development metres completed at the Darlot underground mine based

on forecast mining schedules.

A safety gate of no fatalities at either the KOTH or Darlot operations applies to all PIO KPIs.

The KOTH mine and process plant is progressively ramping up to full production and the Company will provide production guidance for
KOTH when it achieves steady state production in 1H FY23.

The performance hurdles are set at threshold, target and stretch levels, achievement of which will result in different vesting outcomes
(as illustrated in the following table:

Performance level

Below Threshold level

Threshold (represents the minimum acceptable level of performance)

Target (represents a challenging level of performance)

Stretch (represents an exceptional level of performance)

Vesting outcome
(% of PIO opportunity to vest)

33%

67%

100%

The award for performance between Threshold and Target, Target and Stretch will be determined on a pro- rata/sliding basis.

12.5 FY22 EXECUTIVE REMUNERATION OUTCOMES

The following table summarises key measures of Company performance for FY22 and the previous four financial years:

Performance outcomes over the past five FYs

ASX share price at year end

Profit/(loss) after income tax attributable to owners of
the company for continuing operations ($’000)

Profit/(loss) after income tax attributable to owners of
the company ($’000)

Dividends paid ($’000)

Underlying EBITDA (a) ($’000)

(a) Underlying EBITDA is a non-IFRS measure which is unaudited.

FY22

$0.25

FY21

$0.19

FY20

$0.20

FY19

$0.18

FY18

$0.08

(48,664)

(9,478)

4,544

(3,030)

(11,928)

(28,615)

(43,245)

4,544

(3,030)

(11,928)

(4,258)

11,635

53,978

29,890

297

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.5.1 Fixed remuneration outcomes

Following the review of executive remuneration levels against relevant market comparators (with the benchmarking analysis provided by
BDO), the following table outlines fixed remuneration changes for executive KMP in FY22.

FY22 Executive KMP Fixed Remuneration Outcomes

Mark Williams, Managing Director

Jason Greive, Chief Operating Officer

John Tasovac, Chief Financial Officer

FY22 TFR

$687,500

$550,000

$440,000

FY21 TFR

$643,200

$492,750

$415,388

The Board will continue to monitor remuneration levels based on the factors set out in the executive remuneration framework.

12.5.2 FY22 STI outcome

Following the end of FY22 the gateway of 90% of budgeted gold production was not achieved due to several external factors that were
not known when setting the STI targets. These factors include the continued disruptions by the COVID-19 pandemic on the Red 5 key
operations and staffing levels, the increased labour market pressures across the WA gold mining industry, the global breakdown in the
supply chain of key parts and spares (which impacted the production targets).

Within the above context the Board carefully assessed the FY22 performance against set targets and exercised its discretion to
proceed with a 50% of STI outcome for all executives. The awards will be fully satisfied in Service Rights subject to an 18-month
deferral period based on continued employment with Red 5. The share price for the calculation of the number of Service Rights to be
issued will be based on the volume weighted average price (VWAP) of the Company’s shares in the 14 trading days up to 30 June 2022
($0.307).

The Board considered the STI outcome business appropriate for the following reasons:

\ Despite the unforeseen challenges Red 5 had a solid FY22 year overall where the executives had significant success in meeting key
operational targets including the successful commencement of the KOTH mine in Quarter 4 and the achievement of guidance on
production from Darlot;

\ Notwithstanding the factors which have impacted the WA gold mining sector, the Company’s share price has performed well in
FY22 compared to peers and the S&P/ASX All Ordinaries Gold Index (i.e. Red 5 total shareholder return of 31.6% vs Index of
-25.1%); and

\ As competition for executive talent within the mining industry remains extremely tight, the retention of key staff is considered a key
priority for Red 5 over the coming years. The FY22 awards in Service Rights recognise executive achievement over the year whilst
providing a retention mechanism to ensure the progression of key projects in the following 18 months.

The following table outlines KPI performance outcomes for FY22:

Threshold

Target

Stretch

FY22 STI KPIs and Performance Outcomes

FY22 Actual

KPI

KPI Weighting

Performance Outcomes

STI Outcomes

Group EBITDA

30%

Below threshold

Gold production across
Darlot and KOTH

20%

Discretion applied

TRIFR and no fatalities

20%

Below threshold

AISC

20%

Discretion applied

$2.74m

$3.04m

$3.35m

86,158oz

95,731oz

105,304oz

6.36

6.04

5.72

$2,563/oz

$2,330/oz

$2,097/oz

50%

100%

200%

Individual effectiveness

10%

Achieved

90% of budgeted gold
production level

Gateway

Not satisfied due to external factors
(outside of management control)

STI performance outcomes (FY22 awards):

20%

10%

50%

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.5.2 FY22 STI outcome (cont.)

Based on the above outcomes the following provides further detail for FY22 STI awards.

FY22 Executive KMP STI Award Outcomes

Target STI
Opportunity $

$412,500

$250,000

$200,000

$862,500

STI awarded %

STI outcomes $

50%

$206,250

$125,000

$100,000

$431,250

Number of Service
Rights awarded
in the year

671,013

406,674

325,340

1,403,027

Mark Williams

Jason Greive

John Tasovac

Total

12.5.3 FY22 LTI outcome

Following the assessment of relevant performance hurdles over the 3 years ended 30 June 2022, 70% of Rights granted at the start of
FY20 vested. The FY20 Rights was assessed as follows (noting back in FY20 different LTI hurdles and gateway were adopted for
determining the vesting level).

Threshold

Target

Stretch

FY20 LTI Performance Hurdles and Outcomes

FY22 Actual

KPI

KPI
Weighting

Performance Outcomes

<+Index

>10%

>20%

Vesting
Outcomes

Relative TSR (against the S&P/ASX All
Ordinaries Gold Index)

Growth in ore reserves excluding 50% of
acquired ore reserves,

AISC (as a percentage of operating costs
per ounce of AISC)

Safety compliance criteria (no fatalities,
maintenance of the ISO14001 and ISO
18001 certifications, and year on year
improvement in safety

Gateways:
\ Positive TSR; and
\ 80% of budget gold production

Total level of LTI vesting (FY20 awards):

50%

Stretch met

20%

Stretch met

20%

Below threshold

15%

20%

95%

90%

35%

80%

10%

Below threshold

Threshold

Target

Stretch

Gateway

Both gateways satisfied (TSR = +19.92% and
gold production = 81.1%)

50%

20%

70%

In accordance with the terms of the Red 5 Rights Plan, 2,003,062 Rights (out of a total of 2,861,517 Rights issued in FY20) vested
following the 70% vesting level as at the date of this Report. A balance of 858,455 Rights held by executive KMP were forfeited.
The following table outlines the LTI awarded by executive.

Executive KMP – FY20 LTI Awards Vesting Outcomes

Executive KMP

Mark Williams

Jason Greive (a)

John Tasovac

Total

Maximum LTI
Opportunity $

Number of LTI
Rights granted

$514,619

Not eligible

$210,775

$725,395

2,030,056

Not eligible

831,461

2,861,517

LTI Rights
vested %

70%

LTI Rights
vested $

$358,711

Number of Rights
vested during FY22

1,421,039

Not eligible

70%

$146,919

$505,630

582,023

2,003,062

(a) Jason Greive was appointed Chief Operating Officer on 30 November 2020, subsequent to the performance rights being issued in FY20.

Details regarding FY22 LTI performance rights issued during the year are shown in Section 11.9.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)
12.
12.6 NON-EXECUTIVE DIRECTORS’ REMUNERATION

In accordance with current corporate governance practices, the structure for the remuneration of NEDs and executive KMP is separate
and distinct. Shareholders approve the maximum aggregate fees payable to NEDs, with the current limit being $850,000 per annum.

12.6.1 FY22 Non-Executive Director Fee Policy

There were no increases to NED remuneration over FY22. The following table sets out the policy fee for NEDs for FY22 (exclusive of
statutory superannuation of 10%).

Chair

Member

Board and Committee Fees

Board

Audit Committee

Remuneration and Nomination Committee

Risk and Environment Committee

Health, Safety and Community Committee

FY21

$135,000

$15,000

$10,000

FY22

$135,000

$15,000

$10,000

FY21

$100,000

FY22

$100,000

Nil

The Board may approve any consultancy arrangements (at a rate) for NEDs who provide additional services outside of their Board and/
or Committee duties.

NEDs are not entitled to participate in performance-based incentive schemes. The Board may seek annual shareholder approval for a
share plan, under which NEDs can elect to receive a portion of their fees in shares in Red 5.

All Directors are entitled to have premiums on indemnity insurance paid by Red 5. During the financial year, Red 5 paid premiums of
$459,687 (FY21: $318,825) to insure the Directors and other officers of the consolidated entity. The liabilities insured are for costs and
expenses that may be incurred in defending civil or criminal proceedings that may be brought against the officers in their capacity as
officers of entities in the consolidated entity.

12.6.2 FY22 Non-Executive Director Statutory Remuneration Disclosures

The following table outlines the fees paid to NEDs in FY22 as prepared in accordance with the requirements of the Corporations Act
2001 and the relevant Australian Accounting Standards.

NED

Kevin Dundo, Chair

Ian Macpherson, NED

Colin Loosemore, NED

Steven Tombs, NED

Andrea Sutton (a), NED

Fiona Harris (a), NED

TOTAL

Base fees

Committee
Chair fees

Consulting
fees

Superannuation

FY22

FY21

FY22

FY21

FY22

FY21

FY22

FY21

FY22

FY21

FY22

FY21

FY22

FY21

135,000

100,000

61,370

6,319

541,319

496,370

15,000

10,000

45,000

35,000

13,500

12,825

11,500

10,925

11,000

10,450

11,000

10,450

11,000

5,830

663

58,663

50,480

Total

148,500

147,825

126,500

125,925

121,000

120,450

121,000

120,450

121,000

67,200

6,982

644,982

581,850

(a) Andrea Sutton was appointed as a director on 18 November 2020 and Fiona Harris was appointed as a director on 8 June 2022.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.7 PLANNED REMUNERATION APPROACH FOR FY23

During FY22 the Company’s executive remuneration framework was reviewed considering feedback from shareholders, market insights
on incentive structure from external remuneration consultants and the Company’s circumstances. As a result, the following key changes
to executive remuneration arrangements are planned for FY23 to ensure a strong alignment with business need, shareholder feedback
and contemporary market practice. Further details will be provided in the FY23 Remuneration Report.

Remuneration Element

FY23 Approach

TFR

\ As per the Red 5 Remuneration Framework, the Remuneration and Nomination Committee

(RNC) will review TFR levels and recommend necessary adjustments to the Board for approval.

STI

PIO

LTI

\ Any remuneration changes for KMP during FY23 will consider independent market

benchmarking outcomes, changes in executive responsibilities and trends in market for
executive talent locally.

\ Simplify the equity component (representing 50% of STI award) including removing the
Deferred Rights component of the STI and simplify the 50% equity award in the form of a
Service Right (subject to a one-year service-based vesting hurdle). This change ensures a
greater alignment with market practice, the attractiveness of the incentive package and will
reduce the administrative burden / tax complexity.

\ Rebalance the KPI weightings so that each is weighted at 20%. In light of the importance of

culture and executive behaviours in establishing the tone from the top, the individual
effectiveness weighting of 10% was lifted to 20% and the EBITDA KPI has reduced from 30% to
20%.

\ PIO discontinued. The PIO was granted in FY22 as a one-off initiative to meet the unique

demands the Company faced at the time (in a strong development and growth phase where
incentive opportunity offered is low in relation to market). The program is no longer required
considering the objectives of the program can be managed / achieved through the enhanced
STI and LTI structures in FY23 and onwards.

\ Remove design elements not aligned to market including the 12-month retesting mechanism
(in relating to the relative TSR hurdle) and the 90% gold production gateway (which is already
assessed annually in the STI).

\ No change to the relative TSR assessment approach. The Board has considered alternative

methodologies of measuring TSR performance (i.e. comparison of outperformance on a
percentage versus absolute basis). To ensure smooth implementation of other planned
changes, the Board determined to retain current approach and reassess the position in FY24.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.8 DETAILS OF REMUNERATION

The following table discloses details of the nature and amount of each element of the remuneration paid to executive KMP the year
ended 30 June 2022 and 30 June 2021.

Short term

Long term

)
a
(

y
r
a

a
s
h
s
a
C

/
s
e
s
n
e
p
x
E

s
e
c
n
a
w
o

l
l

s
u
n
o
b
h
s
a
c

I
T
S

Executive remuneration

Executive Director

75,000

60,000(h)

Mark Williams

FY22

660,000(a)

FY21

618,200(a)

Executive KMP’s

Jason Greive (b)

FY22

522,500(a)

FY21

264,286

John Tasovac

FY22

412,500(a)

FY21

390,388(a)

FY22

Brendon
Shadlow (c)

FY21

144,583

1,500

s
t
h
g

i
r
d
e
r
r
e
f
e
d
I
T
S

e
c
i
v
r
e
s

I
T
S

)
e
(

s
t
h
g

i
r

75,000(d)

617

26,744(e)

483

8,729

TOTAL

FY22 1,595,000

60,000

FY21

1,417,457 1,500

75,000 1,100

110,473

s
e
e
f
g
n

i
t
l

u
s
n
o
C

n
o

i
t
a
u
n
n
a
r
e
p
u
S

g
n
o

d
n
a

a
u
n
n
A

e
v
a
e
l

e
c
i
v
r
e
s

e
c
n
a
m
r
o
f
r
e
p
I
T
L

)
f
(

e
s
n
e
p
x
e

s
t
h
g

i
r

e
c
n
a
m
r
o
f
r
e
p
I
T
L

)
g
(

d
e
t
i
e
f
r
o
f

s
t
h
g

i
r

a
t
o
T

27,500

74,416

658,559

(155,908)

1,264,567

25,000

62,743

326,378

(57,900)

974,421

27,500

38,701

286,147

26,546

20,330

24,288

874,848

485,450

27,500

32,978

314,754

(63,856)

783,876

25,000

17,245

132,669

(27,628)

565,035

16,166

18,609

50,600

240,670

82,500 146,095 1,259,460 (219,764) 2,923,291

92,712

118,927

533,935

(85,528) 2,265,576

(a) Includes salary, superannuation contributions above concessional cap expensed.

(b) Jason Greive was appointed Chief Operating Officer on 30 November 2020.

(c) Brendon Shadlow was KMP until 30 November 2020. General Manager is no longer categorised as a KMP position upon appointment of

the Chief Operating Officer role.

(d) Includes service rights to granted to Mr Greive for FY21. They have a 12 month service test and vest on 1 July 2022 if Mr Greive is still an

employee at that date.

(e) Includes service rights granted during FY20 subject to a 12 month service test, they have been valued at $0.26 (Red 5 share price as at

18 November 2020). No service rights were granted to Mr Tasovac during FY21.

(f) Relates to performance rights expense for the 2021, 2022 and 2023 series. The fair value at grant date of Tranche A which has market-based
performance conditions, was estimated using a Monte Carlo simulation. The fair value at grant date of Tranches B, C and D, which have
market and non-market-based performance conditions, were valued using a single share price barrier model incorporating a Monte Carlo
simulation.

(g) Performance rights that were issued to key management personnel, senior management and operating personnel in 2019 and 2018 have
been partially forfeited following the partial achievement of performance conditions measured over the three years ended 30 June 2022
and 30 June 2021.

(h) Mr Tasovac was given a ‘special and discretionary award’ by the Board of Directors in recognition of the strong efforts throughout the year,

including success in securing the Debt facility.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

12. REMUNERATION REPORT (AUDITED) (cont.)
12.8 DETAILS OF REMUNERATION (cont.)

The relative proportions of remuneration that are linked to performance and those that are fixed are as follows:

Executive Director

Mark Williams

Non-Executive Directors

Kevin Dundo

Ian Macpherson

Colin Loosemore

Steven Tombs

Andrea Sutton

Fiona Harris

Executives

Jason Greive

John Tasovac

Brendon Shadlow

Fixed

At risk – short term incentives

At risk – long term incentives

2022

2021

2022

2021

2022

2021

60%

72%

100%

67%

60%

100%

64%

70%

46%

40%

28%

30%

33%

32%

26%

47%

12.9 ADDITIONAL REMUNERATION DISCLOSURES

12.9.1 Executive Service Contracts

Remuneration and other terms of employment for executive KMP’s are formalised in service agreements. The service agreements
specify the components of remuneration, benefits and notice periods. Participation in STI and LTI plans is subject to the Board’s
discretion. Other major provisions of the agreements relating to remuneration are set out below:

Position

Terms of
agreement

TFR including
superannuation
effective July 2022

Executive KMP

Mark Williams

Jason Greive

Managing Director

No fixed term

Chief Operating Officer

No fixed term

John Tasovac (a)

Chief Financial Officer

No fixed term

Patrick Duffy (a)

Chief Financial Officer

No fixed term

Notice period

3 months

Termination
benefit

12 months

3 months

6 months

3 months

$725,000

$578,000

$442,000

$450,000

(a) Mr Duffy will be appointed the role of Chief Financial Officer effective from 1 September 2022 following the resignation of Mr Tasovac from

the Company on 31 August 2022.

12.9.2 Options granted to key management personnel

No options over ordinary shares were held or granted during the year to executive officers of Red 5 as part of their remuneration.

No shares were issued during the year as a result of the exercise of options granted as part of remuneration.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.9 ADDITIONAL REMUNERATION DISCLOSURES (cont.)

12.9.3 Shareholdings of directors and key management personnel

The numbers of shares in Red 5 held during the financial year by key management personnel, including personally related entities are
set out below:

Balance at
previous year
reporting date

1,905,249

14,439,852

1,362,054

10,108,190

2,719,579

1,669,048

3,761,420

35,965,392

Received through
vesting and
exercise of
performance
rights

Received through
vesting and
exercise of service
and deferred
rights

1,421,039

582,023

2,003,062

412,088

102,861

514,949

Other purchases/
disposals during
the year

217,946

(3,689,398)

(3,471,452)

Balance at
reporting date

1,905,249

15,860,891

1,580,000

10,108,190

2,719,579

2,081,136

756,906

35,011,951

2022

Kevin Dundo

Mark Williams

Ian Macpherson

Colin Loosemore

Steven Tombs

Andrea Sutton

Fiona Harris

Jason Greive

John Tasovac

Total

12.9.4 Service and Deferred Rights Granted Over FY22

The numbers of Service Rights granted during the financial year are set out in the following table. No Deferred Rights were issued.

Service rights issued: Jason Greive (a)

26-Oct-21

30-Jun-22

Service rights issued: John Tasovac (b)

24-Nov-20

30-Jun-21

Grant Date

Vesting Date

Fair Value at
Grant Date

$75,000

$26,744

Granted

412,088

102,861

Exercised up
to reporting
date

Outstanding
at reporting
date

(412,088)

(102,861)

(a) Service Rights for Mr Greive issued under the Red 5 FY21 Rights Plan. They have a 12 month service test and vested on 30 June 2022

because Mr Greive was still an employee at that date.

(b) Service Rights for Mr Tasovac issued under the Red 5 FY20 Rights Plan. They have a 12 month service test and vested on 30 June 2021

because Mr Tasovac was still an employee at that date.

Share based payments expense for the shares issued, service and deferred rights for KMP’s was $1,259,460 (2021: $123,794). The fair
value is based on observable market share price at the date of grant.

12.9.5 Performance rights held by KMP under the LTI

The number of performance rights in Red 5 held as at the date of this report by executive KMP are set out below:

Balance at
prior year
reporting date

Received through
issuing of LTI
performance
rights (a)

Received
through issuing
of PIO rights (b)

Performance
rights vested and
exercised (c)

Performance
rights forfeited (c)

Balance at
reporting date

3,556,158

415,182

1,429,886

5,401,226

2,266,484

1,373,626

1,098,901

4,739,011

1,510,989

1,098,901

879,121

(1,421,039)

(609,017)

5,303,575

(582,023)

(249,438)

2,887,709

2,576,447

3,489,011

(2,003,062)

(858,455)

10,767,731

KMP

Mark Williams

Jason Greive

John Tasovac

Total

(a) (b) (c) The following tables provide further details regarding Rights on foot:

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.9.5 Performance rights held by KMP under the LTI (cont.)

(a)

FY22 LTI Performance Rights– Managing Director and KMP (Expiry date: 30 June 2024)

Managing Director

Other KMPs:

Jason Greive

John Tasovac

Total KMP rights

Value per right

Valuation per tranche

Condition criteria

Tranche A

1,586,539

961,538

769,231

3,317,308

$0.217

$719,856

Tranche B

679,945

412,088

329,670

1,421,703

$0.28

$398,077

Total

2,266,484

1,373,626

1,098,901

4,739,011

$1,117,933

TSR ranking relative to TSR of
S&P/ASX All Ordinaries Gold
Total Return Index

Growth in the Company’s Ore
Reserves (proved and
probable), excluding 50% of
acquired Ore Reserves

In addition, vesting of the
performance rights is also
conditional on the following being
exceeded:

TSR > Index TSR
+20%

100%

Stretch: 35%
or over

100%

1. a positive Company TSR for the

measurement period; and

TSR > Index TSR
+10%

TSR < or equal to
Index TSR

50%

Target: 20% 50%

nil

Threshold: 15% 25%

2. 90% of budgeted gold
production over the
measurement period.

< 15%

nil

(b)

Project Incentive Opportunity – Managing Director and KMP (Expiry date: 30 June 2023)

Managing Director

Other KMPs:

Jason Greive

John Tasovac

Total KMP rights

Value per right

Valuation per tranche

Condition criteria

Tranche A

755,495

549,451

439,561

1,744,507

$0.28

$488,462

Tranche B

377,747

274,725

219,780

872,252

$0.28

$244,231

Tranche C

377,747

274,725

219,780

872,252

$0.28

$244,231

Total

1,510,989

1,098,901

879,121

3,489,011

$976,924

Greater than a specified
number of gold ounces
produced across both
KOTH and Darlot mines
(50% weighting)

Greater than a specified
volume of tonnes of ore
processed at the KOTH
processing plant (25%
weighting)

Greater than a specified
volume of development
metres completed at the
Darlot underground
mine (25% weighting)

In addition, a safety gate
applies to all PIO KPI’s
whereby no workplace
fatalities occur at either
the KOTH or Darlot
operations.

The Tranche A Rights have been valued using a hybrid employee share option pricing model which incorporates a Monte Carlo
simulation. It uses a correlated simulation that simultaneously calculates the TSR of the Company and the Index on a risk neutral basis
as at the vesting date with regards to the measurement period. The percentage by which the return on the stock exceeds the total return
on the Index is calculated as at the vesting date and a vesting percentage is calculated from the vesting schedule. The forecast share
price at the vesting date is then used to calculate the value of the Right. The price is adjusted based on the vesting percentage, then
discounted to its present value.

Tranche B of the LTI Rights and Tranches A, B and C of the PIO Rights have non-market based vesting conditions attached and are
valued using a single share price barrier model such as a Black Scholes option pricing model.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.9.5 Performance rights held by KMP under the LTI (cont.)

(c)

Rights with market based and non-market based vesting conditions can only be exercised following the
satisfaction of these exercise conditions.

In accordance with the terms of the Red 5 Rights Plan, performance rights that were issued to key management personnel and senior
management have vested following the partial achievement of performance conditions measured over the three years ended 30 June
2022. Performance rights with unmet performance conditions have lapsed, and have been forfeited.

Details of the performance rights issued previously:

FY20 Performance Rights– Managing Director (Expiry date: 30 June 2023)

Tranche A

Tranche B

Tranche C

Tranche D

Total rights

Value per right

763,052

$0.188

Valuation per tranche

$143,454

305,220

$0.195

$59,518

305,220

$0.195

$59,518

152,610

$0.195

$29,759

Condition
criteria

TSR ranking relative
to TSR of S&P/ASX
All Ordinaries Gold
Total Return Index

Growth in the
Company’s Ore
Reserves (excluding
50% of acquired
Ore Reserves)

Operating Costs as
% of Budgeted
Operating Costs

Safety
Compliance

TSR >
Index TSR
+20%

TSR >
Index TSR
+10%

TSR < or
equal to
Index TSR

100%

Stretch:
35%

100%

Stretch:
80%

100%

50%

Target:
20%

50%

Target:
90%

50%

nil

Threshold:
15%

25%

Threshold:
95%

25%

All criteria to
be met:

- No fatalities

- Maintenance of
the ISO14001
and ISO 18001
certifications

- Year on year

improvement in
safety
performance

< 15%

nil

> 95%

nil

Total

1,526,102

$292,249

In addition, vesting
of the performance
rights is also
conditional on the
following being
exceeded:

1. A positive

Company TSR
for the
measurement
period; and

2. 90% of

budgeted gold
production by
30 June 2023.

FY20 Performance Rights – Other Key Management Personnel (Expiry date: 30 June 2023)

Jason Greive

John Tasovac

Total rights

Value per right

Valuation per tranche

Condition
criteria

Tranche A

Tranche B

Tranche C

Tranche D

207,592

299,213

506,805

$0.172

$87,170

83,036

119,685

202,721

$0.179

$36,287

83,036

119,685

202,721

$0.179

$36,287

41,518

59,842

101,360

$0.179

$18,143

TSR ranking relative
to TSR of S&P/ASX
All Ordinaries Gold
Total Return Index

Growth in the
Company’s Ore
Reserves (excluding
50% of acquired
Ore Reserves)

Operating Costs as
% of Budgeted
Operating Costs

Safety
Compliance

TSR >
Index TSR
+20%

TSR >
Index TSR
+10%

TSR < or
equal to
Index TSR

100%

Stretch:
35%

100%

Stretch:
80%

100%

50%

Target:
20%

50%

Target:
90%

50%

nil

Threshold:
15%

25%

Threshold:
95%

25%

All criteria to
be met:

- No fatalities

- Maintenance of
the ISO14001
and ISO 18001
certifications

- Year on year

improvement in
safety
performance

< 15%

nil

> 95%

nil

Total

415,182

598,425

1,013,607

$177,887

In addition, vesting
of the performance
rights is also
conditional on the
following being
exceeded:

1. A positive

Company TSR
for the
measurement
period; and

2. 90% of

budgeted gold
production by
30 June 2023.

2022 ANNUAL REPORT

DIRECTORS’ Report (cont.)

REMUNERATION REPORT (AUDITED) (cont.)

12.
12.9.6 Transactions with Key Management Personnel and their related parties

The NEDs Kevin Dundo, Ian Macpherson and Andrea Sutton invoice for their directors fees through their private companies. They are
not separate entities that provide consulting services to the Company. NEDs Colin Loosemore, Steven Tombs and Fiona Harris are paid
directors fees through the Company’s payroll. Mr Dundo, Mr Macpherson, Mr Loosemore, Mr Tombs, Ms Sutton and Ms Harris meet the
definition and maintain their status as independent NEDs, thus retain objectivity and their ability to meet their oversight role.

END OF AUDITED REMUNERATION REPORT

NON AUDIT SERVICES

13.
During the year, Red 5’s external auditors, KPMG, have provided other services in addition to their statutory audit function. Non audit
services provided by the external auditors comprised $44,546 (2021: $173,887) for non-audit services. Further details of remuneration
of the auditors are set out in Note 25.

The Board has considered the non-audit services provided during the year and is satisfied that the provision of those services is
compatible with the general standard of independence for auditors imposed by the Corporations Act and did not compromise the
auditor independence requirements of the Corporations Act, for the following reasons:

\ All non-audit services were subject to the corporate governance guidelines adopted by Red 5;

\ Non-audit services have been reviewed by the audit committee to ensure that they do not impact the impartiality or objectivity of

the auditor; and

\ The non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110
Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a
management or decision making capacity, acting as an advocate for Red 5 or jointly sharing economic risks and rewards.

AUDITOR’S INDEPENDENCE DECLARATION

14.
A copy of the auditor’s independence declaration as required under Section 307C of the Corporations Act is included immediately
following the Directors’ Report and forms part of the Directors’ Report.

ROUNDING

15.
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and in
accordance with that instrument, all financial information has been rounded to the nearest thousand dollars, unless otherwise stated.

Signed in accordance with a resolution of the Directors.

Kevin Dundo
Chairman

Perth, Western Australia
31 August 2022

2022 ANNUAL REPORT

AUDITOR’S Independence Declaration

Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001

To the Directors of Red 5 Limited

I declare that, to the best of my knowledge and belief, in relation to the audit of Red 5 Limited for the
financial year ended 30 June 2022 there have been:

ii.

no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and

no contraventions of any applicable code of professional conduct in relation to the audit.

PAR_SIG_01

PAR_NAM_01

PAR_POS_01

PAR_DAT_01

PAR_CIT_01

KPMG

R Gambitta
Partner

Perth

31 August 2022

2022 ANNUAL REPORT

Consolidated Statement of
PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
for the year ended 30 June 2022

CONSOLIDATED

30 June 2022

30 June 2021

Sales revenue

Cost of sales

Gross (loss)/profit

Other income and expenses

Other income

Administration and other expenses

Care and maintenance

Exploration expenditure

Financing income

Financing expenses

Ineffective portion of cashflow hedges

Total other income and expenses

(Loss)/profit before income tax expense

Income tax benefit/(expense)

Net (loss)/profit from continuing operations

(Loss)/gain from discontinued operation (net of tax)

Net (loss)/profit after income tax for the year

Other comprehensive income/(loss)

Items that are or may be reclassified subsequently to profit or loss:

Foreign currency translation differences

- Movement in foreign currency translation reserve

- Reclassified to profit or loss

Re-measurement of defined retirement benefit

Cash flow hedge movements

Total comprehensive loss for the year

Net profit/(loss) after income tax attributable to:

Non-controlling interest

Members of parent entity

Total comprehensive profit/(loss) attributable to:

Non-controlling interest

Members of parent company

Earnings/(loss) per share attributable to shareholders

Basic earnings/(loss) per share

Diluted earnings/(loss) per share

Basic earnings/(loss) per share – continuing operations

Diluted earnings/(loss) per share – continuing operations

Note

5(a)

5(b)

5(c)

5(d)

5(e)

5(f)

$’000

164,962

(196,049)

(31,087)

208

(13,371)

(2,522)

(2,815)

(18,492)

(49,579)

915

(48,664)

20,049

(28,615)

631

(26,504)

(1,444)

(55,932)

(86)

(28,529)

(28,615)

(83)

(55,849)

(55,932)

Cents

(1.21)

(2.06)

The accompanying notes form part of these financial statements.

2022 ANNUAL REPORT

$’000

173,358

(171,050)

2,308

692

(9,572)

(2,069)

(3,217)

347

(1,345)

(1,410)

(16,574)

(14,266)

4,788

(9,478)

(33,767)

(43,245)

(1,722)

20,038

(24,853)

(324)

(42,921)

(43,245)

(364)

(24,489)

(24,853)

Cents

(2.08)

(0.44)

Consolidated Statement of FINANCIAL POSITION as at 30 June 2022

CONSOLIDATED

30 June 2022

30 June 2021

Note

$’000

Assets

Current Assets

Cash and cash equivalents

Trade and other receivables

Inventories

Assets held for sale

Total Current Assets

Non-Current Assets

Property, plant and equipment

Mine properties

Exploration and evaluation assets

Trade and other receivables

Intangible assets

Total Non-Current Assets

Total Assets

Liabilities

Current Liabilities

Trade and other payables

Financial liability

Employee benefits

Provisions

Lease liabilities

Liabilities held for sale

Total Current Liabilities

Non-Current Liabilities

Financial liability

Lease liabilities

Provisions

Employee benefits

Deferred tax liability

Total Non-Current Liabilities

Total Liabilities

Net Assets

Equity

Contributed equity

Other equity

Reserves

Accumulated losses

Total Equity Attributable to Equity Holders of the Company

Non-controlling interests

Total Equity

The accompanying notes form part of these financial statements.

32,526

19,025

41,415

92,966

303,378

131,416

41,133

8,180

292

484,399

577,365

64,174

19,376

8,316

1,296

18,490

111,652

152,894

81,604

47,681

739

282,918

394,570

182,795

443,160

930

6,918

(268,196)

182,812

(17)

182,795

17,415

9,861

26,572

25,623

79,471

136,814

63,025

37,135

28,810

230

266,014

345,485

39,787

5,498

1,116

3,529

3,940

53,870

6,624

52,161

421

1,533

60,739

114,609

230,876

442,626

930

31,027

(239,797)

234,786

(3,910)

230,876

2022 ANNUAL REPORT

Consolidated Statement of CHANGES IN EQUITY for the year ended 30 June 2022

ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT ENTITY

a
t
i

p
a
c
d
e
u
s
s
I

d
e
t
a

u
m
u
c
c
A

s
e
s
s
o

y
t
i

u
q
e

r
e
h
t
O

e
v
r
e
s
e
r
n
o

i
t
a

l
s
n
a
r
t

y
c
n
e
r
r
u
c
n
g

i
e
r
o
F

$’000

Balance at 1 July 2021

442,626

(239,797)

930

26,309

e
v
r
e
s
e
r
g
n

g
d
e
H

d
n
a
s
t
n
e
m
y
a
p

s
e
v
r
e
s
e
r

r
e
h
t
o

d
e
s
a
b
-
e
r
a
h
S

g
n

i
l
l

o
r
t
n
o
c
-
n
o
N

t
s
e
r
e
t
n

a
t
o
T

$’000

1,444

$’000

3,274

(3,910)

230,876

Net profit/(loss) for the year

Other comprehensive (loss)/income
for the period:

Foreign currency translation differences

Reclassified to profit or loss

Ineffective portion of cash flow hedges
transferred to profit or loss

Total comprehensive income/(loss)
for the period

Vesting of performance rights (LTI)
converted to ordinary shares

Vested service and deferred rights
converted to ordinary shares (STI)

Performance rights (LTI) forfeited

Share based payments (LTI & STI)

Transfer from reserves

Disposal of subsidiary

449

(28,529)

130

628

(26,504)

(1,444)

(25,876)

(1,444)

(449)

(85)

(296)

4,171

(130)

(86)

(28,615)

631

(26,504)

(1,444)

(83)

(55,932)

(296)

4,171

3,976

6,485

(17)

182,795

Balance at 30 June 2022

443,160

(268,196)

930

433

Balance at 1 July 2020

383,887

(196,876)

930

27,991

(18,594)

2,257

(3,546)

196,049

Net profit/(loss) for the year

Other comprehensive (loss)/income
for the period:

Foreign currency translation differences

Change in fair value of cash flow hedges,
net of tax

Ineffective portion of cash flow hedges
transferred to profit or loss

Total comprehensive income/(loss)
for the period

Issue of ordinary shares

Share issue expenses

Vesting of performance rights (LTI)
converted to ordinary shares

Vested service and deferred rights
converted to ordinary shares (STI)

Issue of deferred and service rights (STI)

Deferred rights reversed, issued in cash
instead

Share based payments (LTI & STI)

(42,921)

60,067

(2,102)

542

232

(1,682)

(324)

(43,245)

(40)

(1,646)

24,786

(4,748)

24,786

(4,748)

(1,682)

20,038

(364)

(24,853)

(542)

(232)

160

(52)

1,607

60,067

(2,102)

160

(52)

1,607

Balance at 30 June 2021

442,626

(239,797)

930

26,309

1,444

3,274

(3,910)

230,876

The accompanying notes form part of these financial statements.

2022 ANNUAL REPORT

Consolidated Statement of CASH FLOWS for the year ended 30 June 2022

CONSOLIDATED

30 June 2022

30 June 2021

Note

$’000

Cash flows from operating activities

Cash received from customers

Payments to suppliers and employees

Payments for exploration and evaluation

Sundry receipts

Income tax paid

Interest received

Interest paid

Net operating cash flows used in discontinued operation

Net cash from operating activities

Cash flows used in investing activities

Payments for property, plant equipment and intangibles

Payments for mine development and pre-operational cost

Payments for exploration and evaluation

Payments for bank guarantee relating to King of the Hills project

Disposal of discontinued operation, net of cash

Net investing cash flows used in discontinued operation

Net cash used in investing activities

Cash flows from financing activities

Proceeds from issues of shares

Payments for share issue transaction costs

Proceeds from borrowings

Repayments of borrowings

Payments of facility fee on borrowings and interest

Payment for settlement for closure of hedges

Receipt from / (payment to) restricted cash

Payments of lease liabilities

Net cash from financing activities

Net increase in cash and cash equivalents

Cash at the beginning of the period

Effect of exchange rate fluctuations on cash held

Cash held within assets held for sale

23(c)

Cash and cash equivalents at the end of the year

The accompanying notes form part of these financial statements.

158,606

(157,055)

(2,522)

223

(791)

(828)

(2,359)

(94,844)

(82,729)

(3,998)

21,467

174,677

(153,921)

(3,217)

547

444

(3,975)

14,555

(99,643)

(10,050)

(7,579)

(21,112)

(53)

(160,104)

(138,437)

175,000

(2,730)

13,000

(8,409)

176,861

14,398

17,415

713

32,526

60,066

(2,102)

(12,000)

(379)

(4,774)

(7,500)

(7,393)

25,918

(97,964)

116,220

(67)

(744)

17,415

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022

\ A steadily increasing production profile in line with the

expected ramp up of the mill and access to higher grade ore
from the KOTH open pit as the lower benches are accessed,
as well as higher-grade feed being delivered from the KOTH
underground mine and Darlot underground mine.

\ Gold price continuing at current market prices.

\ Operating costs have been prepared based on contracted

rates taking into account cost pressures facing the industry,
including rising costs.

\ Capital equipment sufficient to deliver the planned mine

development, completion of the Tailings Storage Facility 5 and
planned exploration activities, noting that not all of these items
have currently been contracted and that there is scope for
these to be modified if required during the course of the year.

The Directors believe the Group will be able to continue as a going
concern and recognise that:

\ The ramp up of KOTH gold production will progressively

generate positive cash flow for the Company.

\ There are risks associated with the ramp up of a new gold
mine and that the industry is operating in a highly volatile
business environment including Covid-19, supply chain
challenges, labour shortages and rising costs.

\ Where there is a mismatch in the generation of cash flows at
KOTH, the Company may formally request the lenders to vary
the timing of debt repayments and scheduled hedging under
the KOTH Project Financing Facility.

\ If required, suitable funding solutions can be sourced taking

into account KOTH’s 4.1Moz Mineral Resource and 2.4Moz
Ore Reserves, the divestment of non-core assets and
other options.

2.3 BASIS OF MEASUREMENT

The consolidated financial statements have been prepared on the
historical cost basis, except for derivative financial instruments
and certain other financial assets and liabilities which are required
to be measured at fair value. Share based payments are measured
at fair value. The methods used to measure fair values of share
based payments are discussed further in the Note 4.12.
Rehabilitation provisions are based on net present value and are
discussed in Note 4.14.

2.4 FUNCTIONAL AND PRESENTATION

CURRENCY

The consolidated financial report is presented in Australian
dollars, which is the Group’s presentation currency. The functional
currency of the Parent Company and the Australian subsidiaries in
which the Group holds its Australian assets is Australian dollars,
and the functional currency of the Company’s other foreign
subsidiaries is Philippine pesos. The functional currency of each
of the Group’s entities is measured using the currency of the
primary economic environment in which that entity operates.

1. REPORTING ENTITY
Red 5 Limited (“parent entity” or “the Company”) is a for profit
company limited by shares incorporated in Australia whose shares
are publicly traded on the Australian Securities Exchange. The
Consolidated Financial Report for the year ended 30 June 2022
comprise the Company and its subsidiaries (together referred to
as the “Group” and individually as “Group entities”) and the
Group’s interest in associates and jointly controlled entities.

The Group is primarily involved in the exploration and mining
of gold.

2. BASIS OF PREPARATION
2.1 STATEMENT OF COMPLIANCE

The consolidated financial statements are general purpose
financial statements which have been prepared in accordance
with Australian Accounting Standards (AASBs) adopted by the
Australian Accounting Standards Board (AASB) and the
Corporations Act 2001. The consolidated financial statements
comply with International Financial Reporting Standards (IFRSs)
adopted by the International Accounting Standards Board (IASB).

The consolidated financial statements were authorised for issue
by the Board of Directors on 31 August 2022.

2.2 GOING CONCERN

The Directors believe it is appropriate to prepare the consolidated
financial report on a going concern basis, which contemplates
continuity of normal business activities and the realisation of
assets and settlement of liabilities in the ordinary course of
business.

The Group’s principal cash flow generating assets are the King of
the Hills (KOTH) and the Darlot Gold Mines, which operate as a
single cash generating unit. In July 2022, Darlot has transitioned
to an underground satellite mine providing ore to KOTH, and the
Darlot process plant has been placed into care and maintenance.

The new KOTH process plant produced first gold on 5 June 2022,
and the KOTH plant and mine is now ramping up towards its
expected full production. The development of the KOTH Project
was partly funded via a $175 million Project Financing Facility
provided by Macquarie Bank, BNP Paribas and Hongkong
Shanghai Banking Corporation.

At 30 June 2022, the Group had current assets of $92.966 million,
primarily consisting of cash on hand, trade receivables and
inventories. At the same date, the Group had current liabilities of
$111.652 million comprised of trade payables, employee benefits,
loan repayments and payments due for right of use leases. A
significant portion of the working capital deficit ($18.686 million)
relates to the current portion of employee benefits and lease
liabilities, which will be funded from KOTH operational cash flows
throughout the course of the year ending 30 June 2023.

Management has prepared a cash flow forecast for the next
twelve months, which anticipates that the Group will be able to
pay its debts as and when they fall due during that period. Key
assumptions in the cashflow forecast include:

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

2. BASIS OF PREPARATION (cont.)
2.5 USE OF ESTIMATES AND JUDGEMENTS

The preparation of the Consolidated Financial Statements requires
management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures, and the
disclosure of contingent liabilities at the date of the consolidated
financial statements. Estimates and assumptions are continually
evaluated and are based on management’s experience and other
factors, including expectations of future events that are believed
to be reasonable under the circumstances. Uncertainty about
these assumptions and estimates could result in outcomes that
require a material adjustment to the carrying amount of assets or
liabilities affected in future periods.

In particular, the Group has identified a number of areas where
significant judgements, estimates and assumptions are required.
Further information on each of these areas and how they impact
the various accounting policies are described with the associated
accounting policy note within the related qualitative and
quantitative note as described below (refer note 4.22).

2.6 ROUNDING

The Company is of a kind referred to in ASIC Corporations
(Rounding in Financial/Directors’ Reports) Instrument 2016/191
and in accordance with that instrument, all financial information
has been rounded to the nearest thousand dollars, unless
otherwise stated.

3. REMOVAL OF PARENT ENTITY
FINANCIAL STATEMENTS

The Group has applied amendments to the Corporations Act 2001
that remove the requirement for the Group to lodge parent entity
financial statements. Parent entity financial statements have been
replaced by the specific parent entity disclosures in Note 35.

4. SIGNIFICANT ACCOUNTING

POLICIES

The accounting policies set out below have been applied
consistently to all periods presented in these financial statements
and have been applied consistently by the consolidated entity.

4.1 PRINCIPLES OF CONSOLIDATION

The consolidated financial report incorporates the assets and
liabilities of all entities controlled by the Company as at 30 June
2022 and the results of all controlled entities for the year then
ended. The Company and its controlled entities together are
referred to in this financial report as the consolidated entity.
The financial statements of controlled entities are prepared for
the same reporting period as the parent entity, using consistent
accounting policies. Intra-group balances and transactions, and
any unrealised income and expenses arising from intra-group
transactions are eliminated in preparing the consolidated
financial statements.

Where control of an entity is obtained during a financial period,
its results are included only from the date upon which control
commences. Where control of an entity ceases during a financial
period, its results are included for that part of the period during
which control existed. Non-controlling interests in equity and
results of the entities which are controlled by the consolidated
entity are shown as a separate item in the consolidated
financial statements.

4.2 FINANCE INCOME AND EXPENSES

Finance income comprises interest income on funds invested.
Interest income is recognised as it accrues, using the effective
interest rate method. Finance expenses comprise interest
expense on borrowings and amortisation of loan borrowing costs.
Loan borrowing costs are amortised using the effective interest
rate method. Interest incurred on loans for the construction of a
qualifying asset is capitalised to the qualifying asset.

4.3 PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment includes land and buildings, plant
and equipment, fixtures and fittings, right-of-use assets and
assets under construction. All assets acquired are initially
recorded at their cost of acquisition, being the fair value of the
consideration provided plus incidental costs directly attributable
to the acquisition.

Land and buildings are measured at cost less accumulated
depreciation on the buildings. Buildings are depreciated on a
straight-line basis over the life of mine.

Plant and equipment are measured at cost less accumulated
depreciation and any accumulated impairment losses. Items of
plant and equipment are depreciated using a combination of units
of production, straight line and diminishing value methods,
commencing from the time they are installed and ready for use, or
in respect of internally constructed assets, from the date the asset
is completed and ready for use. Depreciation of the processing
plant is based on life of mine. The expected useful lives of plant
and equipment are between 3 and 13 years. Depreciation
methods, useful lives and residual values are reviewed at each
reporting date and adjusted if appropriate.

Fixtures and fittings include office equipment and computer
hardware and are depreciated on a straight-line basis over their
expected useful lives between 3 and 13 years.

Right-of-use assets are measured at cost less accumulated
depreciation and any accumulated impairment losses. They are
depreciated using the straight-line method from the
commencement date to the end of the lease term, unless the
lease transfers ownership of the underlying asset to the Group by
the end of the lease term, or the cost of the right-of-use asset
reflects that the Group will exercise a purchase option. In that
case the right-of-use assets are depreciated over the useful life of
the underlying asset.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

4.7 MINE PROPERTIES

POLICIES (cont.)
INTANGIBLE ASSETS

4.4

Intangible assets mainly comprise capitalised software. Intangible
assets are initially recorded at cost of acquisition, being the fair
value of the consideration provided plus incidental costs directly
attributable to the acquisition. Capitalised software is amortised
on a straight-line basis over three years commencing when it is
available for use.

4.5

INVENTORIES

Gold in circuit, bullion on hand and ore stockpiles are physically
measured or estimated and valued at the lower of cost and net
realisable value. Cost represents the weighted average cost and
comprises direct material, labour, and an appropriate portion of
fixed and variable production overhead expenditure on the basis
of normal operating capacity, including depreciation and
amortisation incurred in converting materials to finished products.

Inventories of consumable supplies and spare parts expected to
be used in production are valued at the lower of cost and net
realisable value. Any provision for obsolescence or damage is
determined by reference to specific stock items identified. The
carrying value of those items identified, if any, is written down to
net realisable value.

4.6 EXPLORATION AND EVALUATION

ASSETS

Exploration and evaluation assets are accumulated at cost in
respect of each identifiable area of interest. Costs incurred in
respect of generative, broad scale exploration activities are
expensed in the period in which they are incurred, other than
costs relating to acquisitions. Costs incurred for each area of
interest where a resource or reserve estimated in accordance
with JORC guidelines has been identified, are capitalised.
The costs are only carried forward to the extent they are expected
to be recouped through the successful development of the area,
or where further work is to be performed to provide
additional information.

When production commences, the accumulated costs for the
relevant area of interest will be amortised over the life of the area
according to the rate of depletion of reserves. A regular review is
undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to
that area of interest. Accumulated costs in relation to an
abandoned area will be written off in full to the Statement of Profit
or Loss and Other Comprehensive Income in the year in which the
decision to abandon the area is made.

Mine development:

Pre-Production: Costs incurred in the development of a mine
before production commences are capitalised as part of the mine
development costs, with the exception of any costs relating to the
pre-production sale of products which is expensed to the
Statement of Profit or Loss. All capitalised development costs
incurred within that area of interest are capitalised and carried at
cost. Costs are amortised from the commencement of
commercial production over the productive life of the project on a
unit-of-production basis, based on reserves.

Post-Production: Costs incurred in developing further areas of the
mine are capitalised as part of the mine development costs and
are amortised over the productive life of the project on a unit-of-
production basis, based on reserves.

Deferred waste mining costs: Stripping costs incurred after the
commencement of production are generally considered to create
two benefits, being either the production of inventory or improved
access to the ore to be mined in the future. Where the benefits are
realised in the form of inventory produced in the period, the
production stripping costs are accounted for as part of the cost of
producing those inventories. Where the benefits are realised in the
form of improved access to ore to be mined in the future, the
costs are recognised as a non-current asset, if the following
criteria is met:

\ Future economic benefits (being improved access to the

ore body) are probable;

\ The component of the ore body for which access will be

improved can be accurately identified; and

\ The costs associated with the improved access can be

reliably measured.

If all the criteria are not met, the production stripping costs are
charged to profit or loss as they are incurred.

Depreciation of the stripping activity asset is determined on a unit
of production basis over the life of the asset based on reserves for
each area of interest.

Mineral rights:

Mineral rights comprise identifiable exploration and evaluation
assets, mineral resources and ore reserves, which are acquired as
part of a business combination or joint venture acquisition and are
recognised at fair value at the date of acquisition. Where possible,
mineral interests are attributable to specific areas of interest and
are classified within mine properties, and are amortised over the
life of the mine.

Asset retirement obligation:

Asset retirement obligation represents the estimated future cost of
closure and rehabilitation of the mine site. It is amortised over the
life of the mine.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

POLICIES (cont.)
IMPAIRMENT

4.8

At each reporting date, the consolidated entity reviews and tests
the carrying value of assets when events or changes in
circumstances indicate that the carrying amount may not be
recoverable. Where an indicator of impairment exists, the
consolidated entity makes a formal estimate of recoverable
amount. Where the carrying amount of an asset exceeds its
recoverable amount the asset is considered impaired and is
written down to its recoverable amount. Impairment losses are
recognised in the Statement of Profit or Loss and Other
Comprehensive Income unless the asset has previously been
revalued, in which case the impairment loss is recognised as a
reversal to the extent of that previous revaluation with any excess
recognised through the Statement of Profit or Loss and Other
Comprehensive Income.

Calculation of recoverable amount

Recoverable amount is the greater of fair value less costs of
disposal and value in use. It is determined for an individual asset,
unless it does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in
which case the recoverable amount is determined for the
cash-generating unit to which the asset belongs. The estimated
future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset.

4.9

INCOME TAX

Income tax expense comprises current and deferred tax. Income
tax expense is recognised in profit or loss except to the extent
that it relates to items recognised directly in equity, in which case
it is recognised in equity.

Current tax is the expected tax payable on the taxable income for
the year, using tax rates enacted or substantively enacted at
reporting date, and any adjustment to tax payable in respect of
previous years. Deferred income tax is provided using the
balance sheet liability method on all temporary differences at the
balance sheet date between the tax bases of assets and liabilities
and their carrying amounts for financial reporting purposes.

Deferred income tax assets are recognised for all deductible
temporary differences, carry forward of unused tax assets and
unused tax losses, to the extent that it is probable that taxable
profit will be available against which the deductible temporary
differences, and the carry-forward of unused tax assets and
unused tax losses can be utilised. A deferred income tax asset is
not recognised where the deferred income tax asset relating to
the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss.

The carrying amount of deferred income tax assets is reviewed at
each balance date and reduced to the extent it is no longer
probable that sufficient taxable profit will be available to allow all
or part of the deferred income tax to be utilised.

Deferred income tax assets and liabilities are measured at the tax
rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws)
that have been enacted at the balance date. Income taxes
relating to items recognised directly in equity are recognised in
equity and not in the Statement of Profit or Loss and Other
Comprehensive Income.

4.10 FINANCIAL INSTRUMENTS

Non-derivative financial instruments

Non-derivative financial instruments comprise investments in
equity and debt securities, trade and other receivables, cash and
cash equivalents, loans and borrowings and trade and other
creditors. Non-derivative financial instruments are recognised
initially at fair value plus any directly attributable transaction costs.
Subsequent to initial recognition, non-derivative financial
instruments are measured as described below.

Trade and other receivables are carried at amortised cost. Trade
receivables are non-interest bearing. Loans and borrowings are
measured at amortised cost using the effective interest method,
less any impairment losses. Liabilities for trade creditors and other
amounts are carried at amortised cost. Trade payables are
non-interest bearing and are normally settled on 30 day terms.

For trade receivables, the Group uses the simplified approach to
recognise impairments based on the lifetime expected credit loss.
For other receivables, the Group applies the general approach
and recognises impairments based on a 12-month expected
credit loss. Impairment allowances are based on a forward-
looking expected credit loss model. Where there has been a
significant increase in credit risk, a loss allowance for lifetime
expected credit losses is required.

Exposures are grouped by external credit rating and security
options and an expected credit loss rate is calculated accordingly.
Where applicable, actual credit loss experience is also taken into
account. For remaining receivables without an external credit
rating or security option, a rating of BB (Standard and Poor’s) is
used, on the basis that there is no support that it is investment
grade, nor is there any evidence of default.

For the purposes of the statement of cash flows, cash includes
deposits at call which are readily convertible to cash on hand and
which are used in the cash management function on a day to day
basis, net of outstanding bank overdrafts.

Derivative financial instruments

Derivative financial instruments are recognised initially at fair
value; any attributable transaction costs are recognised in profit
and loss as incurred. Subsequent to initial recognition, derivatives
are measured at fair value.

Cashflow hedges

When a derivative is designated as a cash flow hedging
instrument, the effective portion of changes in the fair value of the
derivative is recognised in other comprehensive income and
accumulated in the hedging reserve. Any ineffective portion of
changes in the fair value of the derivative is recognised
immediately in profit or loss.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

POLICIES (cont.)

4.10 FINANCIAL INSTRUMENTS (cont.)

However, if a new award is substituted for the cancelled award
and designated as a replacement award on the date that it is
granted, the cancelled and new award are treated as if they were a
modification of the original award.

It is management’s intention to settle each contract through
physical delivery of gold and as such, the gold forward sale
contracts entered into by the Company do not meet the criteria of
financial instruments for accounting purposes. This is referred to
as the “own use” exemption. Accordingly, the contracts will be
accounted for as sale contracts with revenue recognised once the
gold has been delivered to the counterparty.

4.11 EMPLOYEE BENEFITS

Provision for employee entitlements represents the amount which
the consolidated entity has a present obligation to pay resulting
from employees’ service provided up to the balance date.

Liabilities arising in respect of employee benefits expected to be
settled within twelve months of the balance date are measured at
their nominal amounts based on remuneration rates which are
expected to be paid when the liability is settled. All other
employee benefit liabilities are measured at the present value of
the estimated future cash outflow to be made in respect of
services provided by employees up to the balance date.
Obligations for contributions to defined contribution
superannuation funds are recognised as an expense in the
Statement of Profit or Loss and Other Comprehensive Income as
incurred.

4.12 SHARE BASED PAYMENTS

The consolidated entity may provide benefits to employees
(including Directors) and other parties as necessary in the form
of share-based payments, whereby employees render services
in exchange for shares or rights over shares (“equity
settled transactions”).

The cost of these equity settled transactions with employees is
measured by reference to the fair value at the date they are
granted. The value is determined using a Monte Carlo model or
equivalent valuation technique. The cost of equity settled
transactions is recognised, together with a corresponding
increase in equity, over the period in which the performance
conditions are fulfilled, ending on the date on which the relevant
employees become fully entitled to the award (“vesting date”).

The cumulative expense recognised for equity settled transactions
at each reporting date until vesting date reflects the extent to
which the vesting period has expired and the number of awards
that, in the opinion of the Directors, will ultimately vest.

No adjustment is made for the likelihood of market performance
conditions being met as the effect of these conditions is included
in the determination of fair value at grant date. No expense is
recognised for awards that do not ultimately vest, except for
awards where vesting is conditional upon a market condition.

Where an equity-settled award is cancelled, it is treated as if it had
vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately.

4.13 FOREIGN CURRENCY

Foreign currency transactions

Transactions in foreign currencies are translated at the foreign
exchange rate ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the
statement of financial position date are translated to Australian
dollars at the foreign exchange rate ruling at that date. Foreign
exchange differences arising on translation are recognised in the
Statement of Profit or Loss and Other Comprehensive Income.
Non-monetary assets and liabilities that are measured in terms of
historical cost in a foreign currency are translated using the
exchange rate at the date of the transaction. Non-monetary assets
and liabilities denominated in foreign currencies that are stated at
fair value are translated to Australian dollars at foreign exchange
rates ruling at the dates the fair value was determined.

The following significant exchange rates have been applied:

Average Rate

Year-End Spot Rate

AUD

Philippine Peso

USD

2022

37.19

0.72

2021

36.17

0.75

2022

37.91

0.69

2021

36.48

0.75

Financial statements of foreign operations

Each entity in the consolidated entity determines its functional
currency, being the currency of the primary economic environment
in which the entity operates, reflecting the underlying transactions,
events and conditions that are relevant to the entity. The functional
currency of the Australian entities is the Australian dollar and the
functional currency of the Philippine entities is the Philippine Peso.
The assets and liabilities of foreign operations, including goodwill
and fair value adjustments arising on consolidation, are translated
from the entity’s functional currency to the consolidated entity’s
presentation currency of Australian dollars at foreign exchange
rates ruling at reporting date. The revenues and expenses of
foreign operations are translated to Australian dollars at the
exchange rates approximating the exchange rates ruling at the
date of the transactions. Foreign exchange differences arising
on translation are recognised directly in a separate component
of equity.

4.14 REHABILITATION COSTS

Full provision for rehabilitation costs is made based on the net
present value of the estimated cost of restoring the environmental
disturbance that has occurred up to the balance date. Increases
due to additional environmental disturbances are capitalised and
amortised over the remaining lives of the operations where they
have future economic benefit, otherwise they are expensed. These
increases are accounted for on a net present value basis.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

4.18 REVENUE FROM CONTRACTS

POLICIES (cont.)

WITH CUSTOMERS

4.14 REHABILITATION COSTS (cont.)

Annual increases in the provision relating to the change in the net
present value of the provision and inflationary increases are
accounted for in the Statement of Profit and Loss as an interest
expense. The estimated costs of rehabilitation are reviewed
annually and adjusted as appropriate for changes in legislation,
technology or other circumstances.

4.15 PROVISIONS

A provision is recognised in the Statement of Financial Position
when the consolidated entity has a present legal or constructive
obligation as a result of a past event and it is probable that an
outflow of economic benefits will be required to settle the
obligation. Provisions are determined by discounting the expected
future cash flows at the pre-tax rate that reflects current market
assessments of the time value of money and where appropriate,
the risk specific to the liability.

4.16 EARNINGS PER SHARE

Basic earnings per share is determined by dividing net operating
results after income tax attributable to members of the parent
entity, excluding any costs of servicing equity other than ordinary
shares, by the weighted average number of ordinary shares
outstanding during the financial year.

Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued
for no consideration in relation to potential ordinary shares.

4.17 BUSINESS COMBINATIONS

The Group accounts for business combinations using the
acquisition method when control is transferred to the Group. The
consideration transferred in the acquisition is generally measured
at fair value, as are the identifiable net assets acquired. Any
goodwill that arises is tested annually for impairment. Any gain on
a bargain purchase is recognised in profit or loss immediately.
Transaction costs are expensed as incurred, except if related to
the issue of debt or equity securities.

The consideration transferred does not include amounts related to
the settlement of pre-existing relationships. Such amounts are
generally recognised in profit or loss.

Any contingent consideration is measured at fair value at the date
of acquisition. If an obligation to pay contingent consideration that
meets the definition of a financial instrument is classified as
equity, then it is not remeasured and settlement is accounted for
within equity. Otherwise, other contingent consideration is
remeasured at fair value at each reporting date and subsequent
changes in the fair value of the contingent consideration are
recognised in profit or loss.

The Group recognises revenue when control has passed to the
buyer; the Company has no significant continuing involvement;
and the amount of revenue and costs incurred or costs to be
incurred in respect of the transaction can be measured reliably.
The Group’s assessment is that this occurs when the sales
contract has been entered into and the customer has physical
possession of the gold as this is the point at which the customer
obtains the ability to direct the use and obtains substantially all of
the remaining benefits of ownership of the asset.

The transaction price is determined based on the agreed upon
price and the number of ounces delivered. Payment is due upon
delivery into the sales contract.

As part of the risk management policy, the Group enters into gold
forward contracts to manage the gold price of a proportion of
anticipated gold sales. The counterparty to the gold forward
contracts is BNP Paribas, Australia Branch, the Hongkong and
Shanghai Banking Corporation Limited, Sydney Branch and
Macquarie Bank Limited (“MBL”) (the counterparties). It is
management’s intention to settle each contract through physical
delivery of gold and as such, the gold forward sale contracts
disclosed below do not meet the criteria of financial instruments
for accounting purposes. This is referred to as the “own use”
exemption. Accordingly, the contracts will be accounted for as
sale contracts with revenue recognised once the gold has been
delivered to the counterparties.

4.19 LEASES

At the inception of a contract the Group assesses whether the
contract is or contains a lease. A contract is, or contains, a lease if
it conveys the right to control the use of an identified asset for a
period of time in exchange for consideration.

The Group recognises it as a right-of-use asset and a
corresponding lease liability with respect to all lease
arrangements in which it is the lessee, except for short-term
leases (defined as leases with a lease term of 12 months or less)
and leases of low value assets. For these leases, the Group
recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease unless another
systematic basis is more representative of the time pattern in
which economic benefits from the leased assets are consumed.

The lease liability is initially measured at the present value of the
lease payments that are not paid at the commencement date,
discounted by using the rate implicit in the lease. If this rate
cannot be readily determined, the Group uses its incremental
borrowing rate.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

Right-of-use assets are depreciated over the shorter period of
lease term and useful life of the underlying asset. If a lease
transfers ownership of the underlying asset or the cost of the
right-of-use asset reflects that the Group expects to exercise a
purchase option, the related right-of-use asset is depreciated over
the useful life of the underlying asset. The depreciation starts at
the commencement date of the lease.

The Group applies AASB 136 to determine whether a right-of-use
asset is impaired and accounts for any identified impairment loss
as described in the ‘Property, Plant and Equipment’ policy (as
outlined in the financial report for the annual reporting period).

Variable rents that do not depend on an index or rate are not
included in the measurement the lease liability and the right-of-
use asset. The related payments are recognised as an expense in
the period in which the event or condition that triggers those
payments occurs and are included in profit or loss.

As a practical expedient, AASB 16 permits a lessee not to
separate non-lease components, and instead account for any
lease and associated non-lease components as a single
arrangement. The Group has not used this practical expedient.
For a contract that contains a lease component and one or more
additional lease or non-lease components, the Group allocates
the consideration in the contract to each lease component on the
basis of the relative stand-alone price of the lease component and
the aggregate stand-alone price of the non-lease components.

4.20 DISCONTINUED OPERATION

A discontinued operation is a component of the Group’s business,
the operations and cash flows of which can be clearly
distinguished from the rest of the Group and which:

\ represents a separate major line of business or geographic

area of operations;

\ is part of a single co-ordinated plan to dispose of a separate
major line of business or geographic area of operations; or

\ is a subsidiary acquired exclusively with a view to resale.

Classification as a discontinued operation occurs at the earlier of
disposal or when the operation meets the criteria to be classified
as held-for-sale.

When an operation is classified as a discontinued operation, the
comparative statement of profit or loss and Other Comprehensive
Income is re-presented as if the operation had been discontinued
from the start of the comparative year.

4. SIGNIFICANT ACCOUNTING

POLICIES (cont.)

4.19 LEASES (cont.)

Assets and liabilities arising from a lease are initially measured on
a present value basis. Lease liabilities include the net present
value of the following lease payments:

\ fixed payments (including in-substance fixed payments), less

any lease incentives receivable;

\ variable lease payments that are based on an index or a rate;

\ amounts expected to be payable by the lessee under residual

value guarantees;

\ the exercise price of a purchase option if the lessee is

reasonably certain to exercise that option; and

\ payments of penalties for terminating the lease, if the lease

term reflects the lessee exercising that option.

The lease liability is subsequently measured by increasing the
carrying amount to reflect interest on the lease liability (using the
effective interest method) and by reducing the carrying amount to
reflect the lease payments made.

The Group remeasures the lease liability (and makes a
corresponding adjustment to the related right-of-use asset)
whenever:

\ The lease term has changed or there is a significant event or

change in circumstances resulting in a change in the
assessment of exercise of a purchase option, in which case
the lease liability is remeasured by discounting the revised
lease payments using a revised discount rate;

\ The lease payments change due to changes in an index or rate
or a change in expected payment under a guaranteed residual
value, in which case the lease liability is remeasured by
discounting the revised lease payments using an unchanged
discount rate (unless the lease payments change is due to a
change in a floating interest rate, in which case a revised
discount rate is used);

\ A lease contract is modified and the lease modification is not
accounted for as a separate lease, in which case the lease
liability is remeasured based on the lease term of the modified
lease by discounting the revised lease payments using a
revised discount rate at the effective date of the modification.

The right-of-use assets comprise the initial measurement of the
corresponding lease liability, lease payments made at or before
the commencement day, less any lease incentives received and
any initial direct costs. They are subsequently measured at cost
less accumulated depreciation and impairment losses.

Whenever the Group incurs an obligation for costs to dismantle
and remove a leased asset, restore the site on which it is located
or restore the underlying asset to the condition required by the
terms and conditions of the lease, a provision is recognised and
measured under AASB 137. To the extent that the costs relate to a
right-of-use asset, the costs are included in the related right-of-
use asset, unless those costs are incurred to produce inventories.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

POLICIES (cont.)

4.21 ASSETS HELD FOR SALE

Non-current assets, or disposal groups comprising assets and
liabilities, are classified as held-for-sale if it is highly probable that
they will be recovered primarily through sale rather than through
continuing use.

Such assets, or disposal groups, are generally measured at the
lower of their carrying amount and fair value less costs to sell. Any
impairment loss on a disposal group is allocated first to goodwill,
and then to the remaining assets and liabilities on a pro rata basis,
except that no loss is allocated to inventories, financial assets or
deferred tax assets which continue to be measured in accordance
with the Group’s other accounting policies. Impairment losses on
initial classification as held-for-sale or held-for-distribution and
subsequent gains and losses on remeasurement are recognised
in profit or loss.

Once classified as held-for-sale, intangible assets and property,
plant and equipment are no longer amortised or depreciated, and
any equity-accounted investee is no longer equity accounted.

4.22 ACCOUNTING ESTIMATES AND

JUDGEMENTS

The selection and disclosure of the consolidated entity’s critical
accounting policies and estimates and the application of these
policies, estimates and judgements is the responsibility of the
Board of Directors. The estimates and judgements that may have
a significant impact on the carrying amount of assets and
liabilities are discussed below.

Impairment of Assets

At each reporting date, the Group makes an assessment for
impairment of all assets if there has been an impairment indicator
by evaluating conditions specific to the Group and to the
particular assets that may lead to impairment. The recoverable
amount of Property, Plant & Equipment and Mine Development
Expenditure is determined as the higher of value-in-use and fair
value less costs of disposal. Value-in-use is generally determined
as the present value of the estimated future cash flows. Present
values are determined using a risk adjusted discount rate
appropriate to the risks inherent in the asset.

Given the nature of the Group’s mining activities, future changes in
assumptions upon which these estimates are based may give rise
to a material adjustment to the carrying value. This could lead to
the recognition of impairment losses in the future. The inter-
relationship of the significant assumptions upon which estimated
future cash flows are based is such that it is impracticable to
disclose the extent of the possible effects of a change in a key
assumption in isolation.

Future cash flow estimates are based on expected production
volumes and grades, gold price and exchange rate estimates,
budgeted and forecasted development levels and operating costs.
Management is required to make these estimates and
assumptions which are subject to risk and uncertainty. As a result,
there is a possibility that changes in circumstances may alter

these projections, which could impact on the recoverable amount
of the assets. In such circumstances, some or all of the carrying
value of the assets may be impaired. Impairment losses are
recognised in the Statement of Profit or Loss unless the asset has
previously been revalued.

Rehabilitation and mine closure provisions

As set out in note 4.14, this provision represents the discounted
value of the present obligation to restore, dismantle and
rehabilitate certain items of property, plant and equipment. The
discounted value reflects a combination of the Group’s
assessment of the costs of performing the work required, the
timing of the cash flows and the discount rate.

A change in any, or a combination, of the three key assumptions
used to determine the provisions could have a material impact to
the carrying value of the provision. In the case of provisions for
assets which remain in use, adjustments to the carrying value of
the provision are offset by a change in the carrying value of the
related asset. Where the provisions are for assets no longer in use
or for obligations arising from the production process, the
adjustment is reflected directly in the Statement of Profit or Loss.

Reserves and resources

The Group determines and reports ore reserves under the
Australian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves Code (“JORC”) as revised
December 2012 JORC for underground reserves and the JORC
2012 edition for open pit reserves. The JORC code requires the
use of reasonable investment assumptions to calculate reserves.
Reserves determined in this way are taken into account in the
calculation of depreciation of mining plant and equipment (refer to
4.3), amortisation of capitalised development expenditure (refer to
note 4.7), and impairment relating to these assets.

Changes in reported reserves may affect the Group’s financial
results and financial position in a number of ways, including:

\ Asset carrying values may be impacted due to changes in

estimated cash flows

\ Depreciation and amortisation charged in the statement of
profit or loss and other comprehensive income may change
where such charges are calculated using the units of
production basis

\ Deferred waste amortisation, based on estimates of reserve to

waste ratios

\ Decommissioning, site restoration and environmental

provisions may change where changes in estimated reserves
alter expectations about the timing or cost of these activities.

Going concern

A key assumption underlying the preparation of the financial
statements is that the Group will continue as a going concern. An
entity is a going concern when it is considered to be able to pay
its debts as and when they are due, and to continue in operation
without any intention or necessity to liquidate or otherwise wind
up its operations.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

4. SIGNIFICANT ACCOUNTING

POLICIES (cont.)

4.22 ACCOUNTING ESTIMATES AND

JUDGEMENTS (cont.)

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
by using Monte Carlo modelling. This estimate also requires
determination of the most appropriate inputs to the valuation
model including the expected life of the equity instrument,
volatility and dividend yield and making assumptions about them.
The assumptions and models used for estimating fair value for
share-based payment transactions are disclosed note 31.

Production start date

The Group assesses the stage of each mine under development/
construction to determine when a mine moves into the production
phase, this being when the mine is substantially complete and
ready for its intended use. The criteria used to assess the start
date are determined based on the unique nature of each mine
development/construction project, such as the complexity of the
project and its location. The Group considers various relevant
criteria to assess when the production phase is considered to
have commenced.

Some of the criteria used to identify the production start date
include, but are not limited to:

\ Level of capital expenditure incurred compared with the

original construction cost estimate;

\ Completion of a reasonable period of testing of the mine plant

and equipment;

\ Ability to produce metal in saleable form (within

specifications); and

\ Ability to sustain ongoing production of metal.

When a mine development project moves into the production
phase, the capitalisation of certain mine development costs
ceases and costs are either regarded as forming part of the
cost of inventory or expensed, except for costs that qualify for
capitalisation relating to mining asset additions or improvements,
underground mine development or mineable reserve
development. It is also at this point that depreciation/amortisation
commences.

Capitalised exploration and evaluation assets

The future recoverability of capitalised exploration and evaluation
expenditure is dependent on a number of factors, including
whether the Group decides to exploit the related lease itself or, if
not, whether it successfully recovers the related exploration and
evaluation asset through sale.

Factors which could impact the future recoverability include the
level of proved, probable and inferred mineral resources, future
technological changes which could impact the cost of mining,
future legal changes (including changes to environmental
restoration obligations) and changes to commodity prices.

To the extent that capitalised exploration and evaluation
expenditure is determined not to be recoverable in the future,
this will reduce profits and net assets in the period in which this
determination is made. In addition, exploration and evaluation
expenditure is capitalised if activities in the area of interest have
not yet reached a stage which permits a reasonable assessment
of the existence or otherwise of economically recoverable
reserves. To the extent that it is determined in the future that this
capitalised expenditure should be written off, this will reduce
profits and net assets in the period in which this determination
is made.

4.23 NEW AND REVISED STANDARDS

AND INTERPRETATIONS

Certain new accounting standards and interpretations have been
published that are not effective for the 30 June 2022 reporting
period. Except for the amendment to AASB 16 Property, Plant and
Equipment, the Group has not elected to early adopt any other
new standards. The other new standards do not have a material
effect on the Group’s financial statements.

Amendment to AASB 116 Property, Plant and
Equipment

The Group has elected to early adopt the amendment in AASB 116
Property, Plant and Equipment, effective for annual periods
beginning on or after 1 January 2022.

The amendment to AASB 116 prohibits an entity from deducting
from the cost of an item of property, plant or equipment any
proceeds received from selling items produced while the entity is
preparing the asset for its intended use.

The effect of adopting the amendment in AASB 116 is to recognise
in profit or loss the proceeds from sales of gold ore produced by
the Group’s King of the Hills operation while it is still in pre-
production phase. Prior to the amendment pre-production
sales proceeds were recognised as a credit against the cost of
the asset.

Effect of pre-production sales from King of the Hills

CONSOLIDATED

30 June 2022

30 June 2021

$’000

3,205

(7,644)

(4,439)

$’000

Gold and silver sales (a)

Costs of goods sold (b)

Effect on gross profit

(a) Pre-production gold ounces sold that were produced by King of
the Hills processing plant amounted to 1,205 ounces for the year
(30 June 2021: nil). This excludes ore fed into the plant sourced
from the Great Western operation.

(b) Costs of producing the gold ounces sold by King of the Hills

during the pre-production phase were allocated to the cost of
goods sold on the basis of the inventory value of the finished
goods sold, along with an allocation of administrative overheads.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

REVENUE AND EXPENSES

Consolidated
Year ended

30 June 2022

30 June 2021

$’000

(a) Revenue

Gold and silver sales

Realised gains/(losses) on cashflow hedges

(b) Cost of sales

Operating costs

Depreciation and amortisation (1)

Other income

(d) Administration and other expenses

Employee and consultancy expenses

Share-based payments

Corporate costs

Property and other indirect taxes

Legal fees

Depreciation

Travel and accommodation

Acquisition related costs

Foreign exchange gains

Other administration overheads

(e) Care and maintenance (2)

Fuel and utilities

Other costs

External services

Materials and consumables used

(f) Finance income / (expenses)

Interest income

Interest expense on borrowings and leases

Amortisation of borrowing costs

Unwinding of discount on rehabilitation provision

Unrealised loss on fuel hedges

162,899

2,063

164,962

(153,934)

(42,115)

(196,049)

208

(5,750)

(4,171)

(1,547)

(931)

(379)

(399)

(205)

647

(636)

(13,371)

(1,867)

(90)

(858)

(2,815)

(2,807)

189,711

(16,353)

173,358

(147,848)

(23,202)

(171,050)

692

(4,109)

(1,767)

(1,457)

(201)

(878)

(291)

(59)

(176)

(636)

(9,572)

(1,026)

(160)

(848)

(35)

(2,069)

347

(921)

(150)

(161)

(113)

(1,345)

(998)

(1) With Darlot underground transitioning to a satellite mine providing ore to King of the Hills, accelerated depreciation and impairments

for the Darlot Process Plant (now in care and maintenance) were booked during the year and totalled $22.585 million.

(2) Care and maintenance costs in 2021 relate to the King of the Hills gold mine, which previously went into care and maintenance

in February 2021.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

INCOME TAX

Current income tax

Current income tax charge

Adjustment for prior period

Deferred income tax

Deferred income tax credit

Adjustment for prior period

Income tax benefit/(charge)

A reconciliation between income tax charge and the profit/(loss) before
income tax at the applicable income tax rate is as follows:

(Loss)/profit before income tax

At statutory income tax rate of 30% (2021: 30%)

Temporary difference not recognised / (recognised)

Items not allowable for income tax purposes:

Non-deductible expenses

Utilisation of carry forward tax losses not brought to account

Current year losses for which deferred tax asset is not recognised

Prior period adjustment

Income tax benefit benefit/(charge)

Tax losses and temporary differences not brought to account (tax effected)

Deductible temporary differences

Tax losses

Consolidated
Year ended

30 June 2022

30 June 2021

$’000

842

915

(49,579)

14,874

2,458

(1,266)

(15,224)

915

42,261

16,326

$’000

1,791

5,122

(2,125)

(2,997)

4,788

(14,266)

4,280

1,400

(558)

(334)

4,788

49,709

7,017

A portion of the tax losses and deductible temporary differences have not been recognised as a deferred tax asset at 30 June 2022
because the Directors do not presently believe that their realisation can be regarded as probable, except to the extent that they offset
deferred tax liabilities.

Movement in deferred tax balances:

Net balance at
1 July 2021

Recognised in other
comprehensive
income

Recognised in
profit or loss

Net balance at
30 June 2022

$’000

(22,463)

(9,561)

18,771

1,584

(278)

10,414

(1,533)

$’000

618

$’000

(48,611)

(2,380)

3,994

(1,771)

(618)

(2,044)

2,307

50,038

915

$’000

(71,074)

(11,941)

3,994

17,000

(460)

2,029

60,452

Property, plant and equipment and intangible assets

Exploration and evaluation assets

Inventories

Provisions and employee benefits

Derivative financial instruments

Leases

Other items

Tax losses recognised

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

INCOME TAX (cont.)

Property, plant and equipment and intangible assets

Exploration and evaluation assets

Provisions and employee benefits

Derivative financial instruments

Leases

Other items

Tax losses recognised

Net balance at
1 July 2020

Recognised in other
comprehensive
income

Recognised in
profit or loss

Net balance at
30 June 2021

$’000

(8,534)

(8,009)

12,813

10,012

(135)

(2,089)

4,058

$’000

(8,588)

$’000

(13,929)

(1,552)

5,958

(1,424)

1,719

1,811

10,414

2,997

$’000

(22,463)

(9,561)

18,771

1,584

(278)

10,414

(1,533)

(a) Red 5 Limited resolved to form a tax consolidated group incorporating all its Australian subsidiaries, with an effective date of 1 November

2017. In accordance with the tax consolidation legislation, the head entity of the Australian tax consolidated group, will assume the deferred
tax assets and liabilities initially recognised by wholly owned members of the tax consolidated group.

CASH AND CASH EQUIVALENTS

Cash at bank (a)

Cash on deposit

Cash on hand

Cash held within assets held for sale

CONSOLIDATED

30 June 2022

30 June 2021

$’000

32,525

32,526

$’000

18,159

18,189

(774)

17,415

(a) Cash at bank includes $13.0 million funds for the construction of the tailings storage facility at King of the Hills which the financiers require

to be set aside for this purpose.

TRADE AND OTHER RECEIVABLES

CONSOLIDATED

30 June 2022

30 June 2021

Current assets

Trade debtors (a)

Restricted cash (b)

GST receivable

Prepayments

Sundry debtors

Interest receivable

Non-current assets

Security deposits

Restricted cash (b)

VAT receivable

$’000

8,158

7,500

2,138

988

240

19,025

8,177

8,180

$’000

3,538

1,612

4,690

9,861

8,306

20,500

28,810

(a) Trade debtors includes amounts receivable for 2,794 ounces sold on 30 June 2022, equivalent to $7.362 million (30 June 2021: 1,313 ounces

equivalent to $3.068 million).

(b) Restricted cash is made up of $7.5 million of funds in a debt service reserve account which has been transferred to current assets in FY22.
The prior year balance included $13.0 million held to fund the construction of the tailings storage facility at King of the Hills. This was
transferred to Cash and Cash Equivalents in FY22 when construction began.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

INVENTORIES

Stores, spares and consumables at cost

Provision for slow-moving stores, spares and consumables (a)

Run of mine stockpiles at net realisable value (2021: net realisable value) (b)

Gold in circuit at net realisable value (2021: net realisable value) (b)

Crushed ore stockpile at net realisable value(b) (2021: at cost)

Gold Bullion at cost

CONSOLIDATED

30 June 2022

30 June 2021

$’000

12,641

(5,382)

7,259

22,245

9,816

1,943

152

41,415

$’000

8,722

(683)

8,039

6,064

11,886

451

132

26,572

(a) During the year the provision for slow-moving stores, spares and consumables inventory at the Darlot mine was increased to $5.382 million

(30 June 2021: $0.683 million).

(b) Net realisable value adjustments of $5.881 million were made during the year (30 June 2021: $3.243 million). In addition a write-down
adjustment to gold in circuit of $7.934 million relating to the Darlot process plant being placed in care and maintenance in July 2022
was made.

Stores, spares and consumables represent materials and supplies consumed in the production process. All stocks have been
calculated as the lower of cost and net realisable value, representing the estimated selling price in the ordinary course of business less
any further costs expected to be incurred in respect of such disposal.

10 PROPERTY, PLANT AND EQUIPMENT

Land and
buildings

Plant and
equipment

Fixtures and
fittings

Right of use
assets

Assets under
construction

$’000

Total

$’000

189,356

198,544

369

302

27,156

99,473

102,281

3,595

677

126,639

6,575

385,037

(99,300)

(2,863)

Cost

Balance at 1 July 2021

Additions (a)

Disposals

Transfer from assets under construction

Balance at 30 June 2022

Cost

10,648

24,315

207

35,170

48,902

70,859

96,214

215,975

Balance at 1 July 2020

13,264

138,487

2,014

Additions (a)

Disposals (b)

Transfer from assets under construction

Transfer to assets held for sale

Balance at 30 June 2021

436

(3,065)

10,648

2,025

(727)

1,867

(92,750)

48,902

(1,752)

369

21,080

6,224

(72)

(76)

7,206

97,765

(1,958)

(732)

27,156

102,281

182,051

106,479

(799)

(98,375)

189,356

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

10 PROPERTY, PLANT AND EQUIPMENT (cont.)

Land and
buildings

Plant and
equipment

Fixtures and
fittings

Right of use
assets

Assets under
construction

$’000

Accumulated depreciation

Balance at 1 July 2021

Depreciation for the year (c)

Disposals

(5,830)

(1,677)

(31,082)

(18,204)

(223)

(65)

(15,407)

(9,171)

Balance at 30 June 2022

(7,507)

(49,286)

(288)

(24,578)

Balance at 1 July 2020

Depreciation for the year

Disposals

Transfer to assets held for sale

(6,475)

(1,600)

2,245

(73,739)

(7,387)

453

49,591

Balance at 30 June 2021

(5,830)

(31,082)

(1,802)

(55)

1,634

(223)

(9,518)

(5,995)

(15,407)

Total

$’000

(52,542)

(29,117)

(81,659)

(91,534)

(15,037)

524

53,505

(52,542)

Carrying amounts

At 1 July 2020

At 30 June 2021

At 30 June 2022

6,789

4,818

64,748

17,820

27,663

166,689

212

146

389

11,562

11,749

7,206

90,517

102,281

136,814

102,061

6,575

303,378

(a) During the year ended 30 June 2022 additions included construction of the KOTH processing plant and the completion of the

accommodation facility and administration blocks at the site. It also included new leased assets, sustaining capital and tailing storage
facility improvements.

(b) Disposals in the prior year relate to old mobile machinery sold during FY21.

(c) With the Darlot underground transitioning to a satellite mine to provide ore to KOTH, and the Darlot process plant being placed into care

and maintenance in July 2022, accelerated depreciation of $9.953 million was recognised in FY22.

11 MINE PROPERTIES

Mine
development

Asset
retirement
obligation Mineral rights

Cost

Balance at 1 July 2021

Additions

Transfer from assets under construction

Rehabilitation change in estimate (refer to note 16)

Balance at 30 June 2022

Balance at 1 July 2020

Additions

Transfer from exploration and evaluation (refer to note 12)

Rehabilitation change in estimate (refer to note 16)

Transfer to assets held for sale

Balance at 30 June 2021

$’000

58,944

82,729

2,693

144,366

235,525

10,050

2,805

(189,436)

58,944

$’000

30,717

Total

$’000

112,626

82,729

2,693

(3,859)

$’000

22,965

(3,859)

19,106

30,717

194,189

11,328

30,717

277,570

13,796

(2,159)

22,965

30,717

10,050

2,805

13,796

(191,595)

112,626

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

11 MINE PROPERTIES (cont.)

Accumulated depreciation

Balance at 1 July 2021

Amortisation

Balance at 30 June 2022

Balance at 1 July 2020

Amortisation

Reclassification of rehabilitation asset

Balance at 30 June 2021

Carrying amounts

At 1 July 2020

At 30 June 2021

At 30 June 2022

Mine
development

Asset
retirement
obligation Mineral rights

$’000

(27,962)

(11,487)

(39,449)

(207,810)

(4,658)

184,506

(27,962)

27,715

30,982

104,917

$’000

(1,756)

(1,434)

(3,190)

(86)

(1,756)

$’000

(19,883)

(251)

(20,134)

(18,457)

(1,426)

(1,756)

(19,883)

11,242

21,209

15,916

12,260

10,834

10,583

Total

$’000

(49,601)

(13,172)

(62,773)

(226,353)

(7,840)

184,592

(49,601)

51,217

63,025

131,416

12 EXPLORATION AND EVALUATION ASSETS

Opening balance

Exploration and evaluation expenditure incurred in current period

Capitalised exploration costs transferred to mine development
(refer to note 11)

Exploration expenditure transferred to profit or loss (a)

Transferred to assets available for sale

Closing Balance

CONSOLIDATED

30 June 2022

30 June 2021

$’000

37,135

6,520

(2,522)

41,133

$’000

32,361

11,187

(2,805)

(3,217)

(391)

37,135

(a) The carrying value of exploration costs totalling $2.522 million were expensed (30 June 2021: $3.217 million). These costs were associated

with drilling and studies at the Darlot Gold Mine, where no further work will be performed in that particular area.

13 TRADE AND OTHER PAYABLES

CONSOLIDATED

30 June 2022

30 June 2021

$’000

60,069

1,663

2,442

64,174

$’000

33,973

1,227

2,291

2,296

39,787

Current

Creditors and accruals

Royalties and other indirect taxes

Insurance payable

Other creditors

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

INCOME TAX PAYABLE

Income tax payable

15 FINANCIAL LIABILITY

Nominal Interest Rate

Loan Term

Carrying Value

Current borrowings

Non-current borrowings

CONSOLIDATED

30 June 2022

30 June 2021

$’000

CONSOLIDATED

30 June 2022

30 June 2021

$’000

BBSY bid rate +4.0%

69 months

172,270

19,376

152,894

172,270

On 17 March 2021 a $175 million debt facility commitment was announced with a syndicate comprising BNP Paribas, Australia branch,
The Hongkong and Shanghai Banking Corporation Limited, Sydney Branch and Macquarie Bank Limited.

The key terms of the project financing facilities include:

\ A$160 million senior secured project loan facility fully drawn;

\ A$15 million cost overrun and working capital facility fully drawn;

\ Loan term of 5.75 years, maturing on 30 September 2026;

\ An interest rate in respect of the senior secured project loan facility of BBSY-bid plus a margin below 4.00% p.a.;

\ Certain financial covenants; and

\ Guaranteed and secured on a first-ranking basis over all Australian assets of Red 5, Greenstone Resources (WA) Pty Ltd, Opus

Resources Pty Ltd and Darlot Mining Company Pty Ltd.

The first draw-down on the debt facility took place in July 2021 and the first repayment of $10.303 million is scheduled for December
2022. Loan acquisition costs of $2.730 million have been off-set against the $175 million drawn down.

Under the Syndicated Facility Agreement which governs the long term debt, the Company will be subject to covenants from the
December 2022 quarter for which it has to report on a quarterly basis or in the event of a default.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

16 PROVISIONS

Opening balance

Provisions made

Provisions utilised

Change in rehabilitation estimate

Change in rehabilitation variables

Unwinding of discount

Closing balance

Rehabilitation
provision (a)

Withholding tax

Other
provisions (b)

$’000

50,683

4,982

(8,841)

857

47,681

$’000

504

(504)

$’000

2,090

323

(1,116)

1,296

Total

$’000

53,277

323

(1,620)

4,982

(8,841)

857

48,977

(a) Rehabilitation provision
Mining activities within the Group are required by law to undertake rehabilitation as part of their ongoing operations. The rehabilitation

provision represents the present value of rehabilitation costs, which are expected to be incurred when the rehabilitation work following the
cessation of operations is expected to be completed. This provision has been created based on the Group’s internal estimates which are
reviewed over time as the operation develops. The accretion of the effect of discounting on the provision is recognised as a financial
expense. In addition, the rehabilitation obligation has been recognised as an intangible asset and has been amortised over the life of the
mines on units of production basis.

(b) Other provisions:

Includes provision for MRF Levy and insurance payable at 30 June 2022.

Current

Non-current

CONSOLIDATED

30 June 2022

30 June 2021

$’000

1,296

47,681

48,977

$’000

1,116

52,161

53,277

17 LEASE LIABILITIES
Lease liabilities include electricity and gas power plants, vehicles and equipment. They have increased as a result of the construction
and development of the King of the Hills. Lease liabilities expire between August 2022 and March 2032 and bear interest at rates
between 2.3% and 8.4%. Ownership of the vehicles and equipment will revert to the Company at the end of the leases at no additional
cost. The Company’s obligations under the leases are secured by the lessor’s title to the leased assets. The fair value of the lease
liabilities approximates their carrying values.

The following schedule outlines the total minimum loan payments due for the lease obligations over their remaining term:

Year ended 30 June

Less than one year

Between one and five years

Current

Non-current

Future minimum lease
payments

Interest

Present value of minimum
lease payments

2022

$’000

25,289

102,863

128,152

25,289

102,863

128,152

2021

$’000

3,917

7,760

11,677

3,917

7,760

11,677

2022

$’000

6,799

21,259

28,058

6,799

21,259

28,058

2021

$’000

388

1,136

1,524

388

1,136

1,524

2022

$’000

18,490

81,604

2021

$’000

3,529

6,624

100,094

10,153

18,490

81,604

100,094

3,529

6,624

10,153

Variable lease payments on right-of-use assets amounted to $27.287 million for the year.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

18 EMPLOYEE BENEFITS

Provision for annual leave

Provision for long-service leave

Provision for incentive payments

Current

Non-current

19 DERIVATIVE FINANCIAL INSTRUMENTS

Opening balance

Settlement of cashflow hedges

Closing balance

CONSOLIDATED

30 June 2022

30 June 2021

$’000

3,436

1,589

4,030

9,055

8,316

739

9,055

$’000

2,912

1,634

1,373

5,919

5,498

421

5,919

CONSOLIDATED

30 June 2022

30 June 2021

$’000

(33,375)

33,375

During the prior year as part of the King of the Hills debt funding, the Group closed all existing hedge contracts and entered into new
gold forward contracts amounting to 189,651 ounces of gold produced at the King of the Hills operation. The hedge contracts are
priced at an average of $2,154 per ounce for the period from October 2022 to June 2025. The new gold forward contracts are accounted
for using the “own use” exemption.

In the prior year the Group had a hedge liability position reflecting a negative mark-to-market value of gold contracts of $33.375 million
comprising forward contracts for 67,000 ounces of gold at an average price of $2,089 per ounce for the period July 2020 to September
2021. In March 2021 the remaining open hedges were closed as mentioned above.

20 CONTRIBUTED EQUITY
(a) Share capital

2,356,360,652 (30 June 2021: 2,346,323,247) ordinary fully paid shares

CONSOLIDATED

30 June 2022

30 June 2021

$’000

443,160

$’000

442,626

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

20 CONTRIBUTED EQUITY (cont.)
(b) Movements in ordinary share capital

On issue at 1 July 2020

Capital raising for cash

Service rights vested

Deferred rights vested and converted to shares

Performance rights vested and converted to shares

Share issue costs

On issue at 30 June 2021

On issue at 1 July 2021

Service rights vested

Performance rights vested and converted to shares

On issue at 30 June 2022

CONSOLIDATED

Thousand Shares

1,958,845

375,415

744

328

10,992

2,346,323

328

9,710

2,356,361

$’000

383,887

60,066

149

542

(2,102)

442,626

449

443,160

Ordinary shares entitle the holder to participate in dividends and proceeds on the winding up of the parent entity in proportion to the
number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or
by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

Opening balance 1 July 2021 (a)

Balance 30 June 2022

CONSOLIDATED

Thousand
Shares

581

30 June 2022
$’000

930

(a) Red 5 has provided for 581,428 shares to be issued at a value of $930,285 to settle the outstanding tax liability in relation to the acquisition
of Merrill Crowe Corporation (MCC) in a previous financial year.

21 RESERVES

Foreign currency translation reserve (a)

Deferred retirement benefit (b)

Share-based payment reserve and other reserves(c)

Hedging reserve (d)

CONSOLIDATED

30 June 2022

30 June 2021

$’000

433

6,485

6,918

$’000

26,309

130

3,144

1,444

31,027

(a) The foreign currency translation reserve comprises foreign exchange differences arising from the translation of the financial statements of
foreign operations where the functional currency is different to the presentation currency of the reporting entity. This balance has been
mostly released to the income statement on the sale of the main Philippine operation, Greenstone Resources Corporation (GRC) in the
current year.

(b) This reserve is for the revaluation movements of the defined retirement benefit fund for Philippines employees. It has been released on the

sale of GRC during the current year.

(c) The share-based payment reserve includes performance rights, service and deferred rights reserve. It arises on the granting and vesting of

equity instruments. Refer note 31 for further details.

(d) The hedging reserve comprises the effective portion of the cumulative net change in the fair value of hedging instruments (net of tax) used

in cash flow hedges pending subsequent recognition in profit or loss. At year-end there were no open hedges (refer note 19).

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

22 EARNINGS PER SHARE
Earnings per share (“EPS”) is the amount of post-tax profit or loss attributable to each share. The Group presents basic and diluted EPS
data for ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by
the weighted average number of ordinary shares outstanding during the period.

Diluted EPS takes into account the dilutive effect of all potential ordinary shares, being unlisted employee performance and service
rights on issue.

Net (loss)/profit after income tax from continuing operations attributable
to members of the parent company

Net profit/(loss) after income tax from discontinued operations

Net (loss)/profit after income tax attributable to members of
the parent company

Weighted average number of ordinary shares (‘000)

Issued ordinary shares at 1 July

Effect of shares issued 21 August 2021

Effect of shares issued 7 September 2021

Effect of shares issued 20 July 2020

Effect of shares issued 11 September 2020

Effect of shares issued 25 November 2020

Effect of shares issued 25 March 2021

Effect of shares issued 16 April 2021

CONSOLIDATED

30 June 2022

30 June 2021

$’000

(48,578)

20,049

$’000

(9,478)

(33,767)

(28,529)

(43,245)

CONSOLIDATED

Weighted average no. of shares

2022

2021

2,346,322

1,958,845

8,353

266

706

8,823

196

65,861

27,093

Weighted average number of ordinary shares at 30 June (basic)

2,354,941

2,061,524

Weighted-average number of ordinary shares (basic):

2,354,941

2,061,524

Effect of performance rights contingently issuable

Effect of service rights contingently issuable

Weighted average number of ordinary shares at 30 June (diluted)

2,354,941

2,061,524

Earnings per share (cents per share)

Basic (loss)/profit per share

Diluted (loss)/profit per share

Basic (loss)/profit per share – continuing operations

Diluted (loss)/profit per share – continuing operations

(1.21)

(2.06)

(2.08)

(0.44)

For fully diluted (loss)/profit per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of
dilutive potential ordinary shares if the Group has made a profit. The Group’s potentially dilutive securities consist of performance and
service rights.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

23 DISCONTINUED OPERATION
Sale of Siana Gold Mine (Philippines)

During FY21, the Group had been in negotiations with interested parties to divest its interests in Philippine-affiliated company
Greenstone Resources Corporation (GRC), which holds both the Siana Gold Project (Siana) and the Mapawa Gold Project.

The divestment of its interests in Siana is consistent with Red 5’s strategy to focus on its King of the Hills and Darlot gold mines in
Western Australia, with the aim of becoming a substantial mid-tier Australian gold producer.

In July 2021, a binding agreement with TVI Resource Development (Phils.) Inc. (TVIRD) was entered into for the sale of GRC. TVIRD
is the Philippine affiliate of the Canadian-listed TVI Pacific Inc. The divestment included the process plant and all other infrastructure
at Siana.

Upon completion of all closing conditions of the agreement, which included certain Philippine regulatory approvals which were satisfied
during the September 2021 quarter, the Group received gross proceeds of US$19 million (approximately A$25.3 million) through the
repayment of outstanding shareholder advances due from its Philippine-affiliated company, Red 5 Asia Inc, which was a shareholder
of GRC.

In addition, a royalty of 3.25% payable for up to 619,000 ounces of gold will be payable to the Group from first gold from the restart of
the Siana processing plant, which is expected in the first half of 2023.

(a) Results of discontinued operation

Disposal consideration net of costs to sell

Net assets disposed of

Non-controlling interest

Foreign currency translation reserve

Gain on sale of discontinued operation (i)

Care and maintenance costs

Impairment of discontinued operation (ii)

Profit/(loss) from discontinued operation

CONSOLIDATED

30 June 2022

30 June 2021

$’000

22,076

(22,580)

(3,976)

25,704

21,224

(1,175)

20,049

$’000

(7,199)

(26,568)

(33,767)

(i) The gain on sale of discontinued operation is mainly derived from the release of the foreign currency translation reserve associated with

the disposal of the discontinued operation’s net assets. There were no tax consequences on the sale consideration due to available tax
losses in the Philippines.

(ii) Due to uncertainty of receipt of the 3.25% royalties on the ounces of gold to be produced by GRC in the future, an impairment loss to
the write down of the assets and liabilities of the discontinued operation to the lower of its carrying amount and fair value was incurred
and accounted for in the June 2021 annual report.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

23 DISCONTINUED OPERATION (cont.)
(b) Effect of disposal of discontinued operation on the financial position of the Group

CONSOLIDATED

30 June 2022

30 June 2021

Plant, property and equipment

Mine properties

Inventory

Trade and other receivables

Cash and cash equivalents

Total assets disposed of (2021: Assets held for sale)

Trade and other payables

Provisions

Employee benefits

Lease liabilities

Total liabilities disposed of (2021: Liabilities held for sale)

Net assets disposed of (2021: Net assets held for sale)

Net cash used in operating activities

Net cash used in investing activities

Net cash from financing activities

Net cash flow for the year

$’000

16,740

960

6,014

639

609

24,962

(18)

(2,364)

(2,382)

22,580

$’000

17,367

960

6,003

519

774

25,623

(1,514)

(2,362)

(58)

(6)

(3,940)

21,683

CONSOLIDATED

30 June 2022

30 June 2021

$’000

(828)

21,467

20,639

$’000

(3,975)

(53)

(4,028)

24 RELATED PARTIES
The following were key management personnel of the consolidated entity at any time during the reporting period and unless otherwise
indicated, were key management personnel for the entire reporting period:

Executive Directors

Mark Williams – Managing Director

Non-Executive Directors

Kevin Dundo
Ian Macpherson
Colin Loosemore
Steve Tombs
Andrea Sutton
Fiona Harris

Other executives

Jason Greive – Chief Operating Officer
John Tasovac – Chief Financial Officer

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

24 RELATED PARTIES (cont.)
Compensation of key management personnel

A summary of the compensation of key management personnel is as follows:

Key management personnel

Short term benefits including service and deferred rights

Post-employment benefits

Long term benefits

Share based payments

CONSOLIDATED

30 June 2022

30 June 2021

2,241,301

141,130

146,095

1,039,696

3,568,273

2,136,900

143,192

118,927

448,407

2,847,426

Loans to key management personnel

There were no loans to key management personnel during the period.

Transactions with related parties in the wholly owned group

During the financial year, unsecured loan advances were made between the parent entity and its controlled entities. All such loans were
interest free. Intra entity loan balances have been eliminated in the financial report of the consolidated entity. The ownership interests in
related parties in the wholly owned group are set out in Note 29.

25 REMUNERATION OF THE AUDITOR

Amounts paid or due and payable to the auditor for:

Auditing and reviewing financial reports

– KPMG Australia

– KPMG Australia fee from prior year

– overseas KPMG firms

Taxation advisory services

– KPMG Australia

– overseas KPMG firms

CONSOLIDATED

30 June 2022

30 June 2021

195,900

40,000

4,445

44,546

284,891

153,810

39,738

165,859

8,028

367,435

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

26 CAPITAL AND OTHER COMMITMENTS

CONSOLIDATED

30 June 2022

30 June 2021

$’000

Capital expenditure commitments

Contracted but not provided for: (a)

- not later than one year

Contractual sale commitments

Sale commitments: (b)

- not later than one year

- later than one year but not later than two years

- later than two years but not later than five years

Contractual expenditure commitments

Non-capital expenditure commitments:

- not later than one year

Tenement expenditure commitments:

- not later than one year

- later than one year but not later than two years

15,413

125,072

184,419

100,533

410,024

904

3,291

2,931

6,222

83,934

125,072

284,952

410,124

5,376

3,310

2,612

5,922

(a) In the prior year capital commitments related to the processing plant construction at King of the Hills. The project was completed during the
current year, resulting in the remaining capital commitments at 30 June 2022 relating to the construction of the tailings storage facility at
King of the Hills.

(b) Includes forward sale contractual commitments for 189,650 ounces amounting to $410 million relating to future sales of gold from King of

the Hills. The hedge contracts are fixed at an average price of $2,154 per ounce and settle between October 2022 and June 2025. They are

accounted for under the “own use” exemption.

27 CONTINGENT LIABILITIES
The consolidated entity had no material contingent liabilities as at the reporting date and as at the end of the year.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

28 SEGMENT INFORMATION
The Group is managed primarily on the basis of its production, development and exploration assets in both Australia and the
Philippines. Operating segments are therefore determined on the same basis. Due to the sale of the Philippines operation (refer to note
23), the Philippines segment is classified as a discontinued operation. The Australia segment is made up of the Darlot and King of the
Hills operations.

Unless otherwise stated, all amounts reported to the Board of Directors as the chief decision maker with respect to operating segments
are determined in accordance with accounting policies that are consistent with those adopted in the consolidated annual financial
statements of the Group.

Australia (a)

Philippines
(discontinued)

$’000

Other (b)

$’000

Total

$’000

(i) Segment performance

Year ended 30 June 2022

Revenues (c)

Segment result before tax

Included within segment result:

Other income

Interest income

Finance expenses

Exploration costs expensed

Depreciation and amortisation

Profit/(loss) from discontinued operation

Year ended 30 June 2021

Revenues (c)

Segment result before tax

Included within segment result:

Other income

Interest income

Finance expenses

Exploration costs expensed

Depreciation and amortisation

Impairment of discontinued operation

Care and maintenance costs

(ii) Segment Assets

As at 30 June 2022

Segment assets

Additions to non-current assets:

Plant and equipment expenditure

Mine properties

Intangible assets

As at 30 June 2021

Segment assets

Additions to non-current assets:

Plant and equipment expenditure

Mine properties

Intangible assets

2022 ANNUAL REPORT

164,962

(38,089)

208

(1,797)

(2,522)

(42,188)

173,358

(4,363)

527

(787)

(3,217)

(23,253)

546,992

198,540

82,729

164,962

20,049

(11,490)

(29,530)

20,049

(1,018)

(326)

208

(2,815)

(2,522)

(42,514)

20,049

173,358

(33,767)

(9,903)

(48,033)

(26,568)

(7,199)

165

312

(558)

(240)

692

347

(1,345)

(3,217)

(23,493)

(26,568)

(7,199)

30,373

577,365

103

198,544

82,729

117

294,099

25,623

25,763

345,485

105,060

10,050

1,419

106,479

10,050

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

28 SEGMENT INFORMATION (cont.)

(iii) Segment Liabilities

As at 30 June 2022

Segment liabilities

As at 30 June 2021

Segment liabilities

Australia (a)

Philippines
(discontinued)

$’000

Other (b)

$’000

Total

$’000

215,484

179,086

394,570

105,688

3,940

4,981

114,609

(a) Australia segment consists of the Darlot Mining Company Pty Ltd and the King of the Hills gold project.

(b) Includes corporate costs of the group and inter-company transactions.

INVESTMENTS IN CONTROLLED ENTITIES

Name of controlled entities

Bremer Resources Pty Ltd

Estuary Resources Pty Ltd

Greenstone Resources (WA) Pty Ltd

Oakborough Pty Ltd

Opus Resources Pty Ltd

Red 5 Philippines Pty Ltd

Red 5 Mapawa Pty Ltd

Red 5 Dayano Pty Ltd

Darlot Mining Company Pty Ltd

Bremer Binaliw Corporation

Red 5 Mapawa Inc

Red 5 Dayano Inc

Red 5 Asia Inc

Greenstone Resources Corporation (a)(b)

Surigao Holdings and Investments Corporation (b)

Country of
incorporation

Class of shares

2022

2021

Equity holding %

Australia

Philippines

Ordinary

100

(a) In September 2021 the Company sold all its interest in Greenstone Resources Corporation to a Philippine registered resources company,

TVI Resources Incorporated (refer to note 23).

(b) The Company held a 40% direct interest in Greenstone Resources Corporation (GRC) before it’s sale (refer to note above) and currently still
holds a 40% interest in Surigao Holdings and Investments Corporation (SHIC) voting stock. Agreements are in place which deal with the
relationship between Red 5 and other shareholders of these entities. In accordance with Australian accounting standard, AASB 10
Consolidated Financial Statements, Red 5 has consolidated these companies in these financial statements.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

30 RECONCILIATION OF NET CASH FLOWS FROM OPERATING ACTIVITIES

CONSOLIDATED

30 June 2022

30 June 2021

Operating (loss)/profit after income tax

Profit on sale discontinued operation

Impairment of discontinued operation

Amortisation and depreciation

Ineffective portion of cashflow hedges

Deferred tax

Share based payment

Interest expenses

Write down of obsolete inventory

Write down of gold-in-circuit inventory

Non-cash stockpile movements

Unwinding of asset retirement obligation

Amortisation of borrowing costs

Other

Changes in operating assets and liabilities:

(Increase)/decrease in inventories

(Increase)/decrease in receivables

Increase/(decrease) in payables

(Decrease)/increase in income tax payable

(Decrease)/increase in provisions

Net cash flow from operating activities

$’000

(28,615)

(21,225)

42,514

(2,063)

(915)

3,875

326

4,699

7,934

(522)

858

861

(14,843)

(1,664)

7,192

(861)

(2,359)

31 SHARE-BASED PAYMENT ARRANGEMENTS
The following is the movement in performance rights during the period:

Movement in Performance Rights year ended 30 June 2022

Performance rights Series

2022 Series

2023 Series

2023 PIO Series

2024 Series

Total

Balance at
1 July 2021

10,442,031

7,945,729

18,387,760

Granted (a)

11,550,613

18,410,000

29,960,613

Vested (b)

(5,576,211)

Forfeited (c)

(4,865,820)

(5,576,211)

(4,865,820)

Movement in Performance Rights year ended 30 June 2021

$’000

(43,245)

26,568

23,493

(3,363)

(2,997)

1,767

921

683

362

179

150

2,632

9,588

1,936

(2,930)

(1,791)

602

14,555

Balance at
30 June 2022

7,945,729

11,550,613

18,410,000

37,906,342

Balance at 30
June 2021

10,442,031

7,945,729

Performance rights Series

2021 Series

2022 Series

2023 Series

Total

Balance at
1 July 2020

15,241,298

10,442,031

25,683,329

2022 ANNUAL REPORT

Granted (a)

Vested (b)

7,945,729

(10,668,909)

Forfeited (c)

(4,572,389)

(10,668,909)

(4,572,389)

18,387,760

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

31 SHARE-BASED PAYMENT ARRANGEMENTS (cont.)
Performance rights granted during the year ended 30 June 2022:
(a)

Project Incentive Opportunity (PIO) rights were granted to the Managing Director, Key Management Personnel, Senior Management and
other operational employees during the period. The performance rights are split into three tranches based on different performance
conditions measured over a period commencing 1 July 2022 to the vesting date which is 30 June 2023 if the conditions are met.

Details of the PIO rights granted during the period are summarised below:

Project Incentive Opportunity – (Expiry date: 30 June 2023)

Total PIO rights

Value per right

Valuation per tranche

Condition criteria

Tranche A

5,775,306

$0.28

$1,617,086

Tranche B

2,887,654

$0.28

$808,543

Tranche C

2,887,654

$0.28

$808,543

Greater than a
specified number of
gold ounces produced
across both KOTH and
Darlot mines (50%
weighting)

Greater than a
specified number of
tonnes of ore
processed at the KOTH
processing plant (25%
weighting)

Greater than a
specified volume of
development metres
completed at the Darlot
underground mine
(25% weighting)

Total

11,550,613

$3,234,172

In addition, a safety
gate applies to all PIO
KPI’s whereby no
workplace fatalities
occur at either the
KOTH or Darlot
operations.

LTIP Performance rights were granted to the Managing Director, Key Management Personnel, Senior Management and other
operational employees during the period. The performance rights are split into two tranches based on different performance conditions
measured over a period commencing 1 July 2022 to the vesting date which is 30 June 2024 if the conditions are met.

Details of the performance rights granted during the period are summarised below:

LTIP Performance Rights 2024 series – (Expiry date: 30 June 2024)

Total performance rights

Value per right

Valuation per tranche

Condition criteria

Tranche A

12,887,002

$0.217

$2,796,479

Tranche B

5,522,998

$0.28

$1,546,440

TSR ranking relative to
TSR of S&P/ASX All
Ordinaries Gold Total
Return Index

Growth in the Company’s
Ore Reserves (proved and
probable), excluding 50%
of acquired Ore Reserves

Total

18,410,000

$4,342,919

In addition, vesting of the performance rights
is also conditional on the following being
exceeded:

1. a positive Company TSR for the

measurement period; and

2. 90% of budgeted gold production over

the measurement period.

TSR > Index
TSR +20%

TSR > Index
TSR +10%

TSR < or equal
to Index TSR

100%

50%

nil

Stretch:
35% or over

100%

Target:
20%

Threshold:
15%

50%

25%

< 15%

nil

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

31 SHARE-BASED PAYMENT ARRANGEMENTS (cont.)

Model Inputs

Grant date

Value of the underlying security at grant date

Exercise price

Dividend yield

Risk free rate

Volatility

Performance period (years)

Commencement of measurement period

Vesting date

Remaining performance period (years)

Weighted average fair value per right

No. performance rights

Total Valuation

PIO Rights
(2023 series)

10 Dec 2021

$0.28

nil

0.535%

LTIP Rights
(2024 series)

10 Dec 2021

$0.28

nil

0.935%

All tranches: 75%

2.00

1 July 2021

30 June 2023

1.55

$0.28

11,550,613

$3,234,172

3.00

1 July 2021

30 June 2024

2.56

$0.236

18,410,000

$4,342,919

(b) In accordance with the terms of the Red 5 Rights Plan, performance rights that were issued to key management personnel and

senior management have vested following the partial achievement of performance conditions measured over the three years ended
30 June 2022.

Shares issued, Service and Deferred Rights

Grant Date

Vesting Date

Fair Value at
Grant Date

Granted

Exercised

Outstanding at
30 June 2022

Service rights issued and vested:
Jason Greive (a)

Service rights issued and vested:
John Tasovac (b)

26-Oct-21

30-Jun-22

$75,000

412,088

24-Nov-20

30-Jun-21

$26,744

102,861

(102,861)

(a) Service Rights for Mr Greive issued under the Red 5 FY21 Rights Plan. They have a 12 month service test and vested on 1 July 2022

because Mr Greive was still an employee at that date.

(b) Service Rights for Mr Tasovac issued under the Red 5 FY20 Rights Plan. They have a 12 month service test and vested on 1 July 2021

because Mr Tasovac was still an employee at that date.

Share based payments expense for the shares issued, service and deferred rights was $nil, (2021: $0.124 million). The fair value is
based on observable market share price at the date of grant.

32 FINANCIAL RISK MANAGEMENT
OVERVIEW

This note presents information about the consolidated entity’s exposure to credit, liquidity and market risks, their objectives, policies
and processes for measuring and managing risk, and the management of capital.

The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. Management
monitors and manages the financial risks relating to the operations of the consolidated entity through regular reviews of the risks.

CREDIT RISK

Credit risk is the risk of financial loss to the consolidated entity if a customer or counterparty to a financial instrument fails to meet its
contractual obligations and arises principally from the consolidated entity receivables from customers and investment securities. For
the Company it arises from receivables due from subsidiaries.

Presently, the consolidated entity undertakes exploration, mining and gold production activities.

The Group sells gold to two customers in Australia and has managed its exposure to credit risk by analysing the creditworthiness
of the customer.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

32 FINANCIAL RISK MANAGEMENT (cont.)
Cash and cash equivalents

The consolidated entity limits its exposure to credit risk by only investing in liquid securities and only with counterparties that have an
acceptable credit rating. Any excess cash and cash equivalents are maintained in short term deposits with more than one major
Australian commercial bank at interest rates maturing over 30 to 120 day rolling periods.

Trade and other receivables

The Group’s trade and other receivables relate mainly to gold sales and sales tax refunds. The Group has determined that its exposure
to trade receivable credit risk is low, given that it sells gold bullion to a single reputable refiner with short contractual payment terms and
sales tax refunds are due from Government tax bodies namely the Australian Tax Office and the Philippines Bureau of Internal Revenue.

Exposure to credit risk

The carrying amount of the consolidated entity’s financial assets represents the maximum credit exposure. The maximum exposure to
credit risk at the reporting date was:

Cash and cash equivalents

Trade and other receivables

Non-current receivables

LIQUIDITY RISK

CONSOLIDATED

Carrying amount

2022

$’000

32,526

19,025

8,180

2021

$’000

17,415

9,861

28,810

Liquidity risk is the risk that the consolidated entity will not be able to meet its financial obligations as they fall due. The consolidated
entity approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when
due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the consolidated entity.

The consolidated entity manages liquidity risk by maintaining adequate cash reserves from funds raised in the market and by
continuously monitoring forecast and actual cash flows.

The following are the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of
netting agreements:

CONSOLIDATED

As at 30 June 2022

Trade and other payables

Lease liabilities

Financial liabilities

As at 30 June 2021

Trade and other payables

Lease liabilities

Carrying
amount

$’000

64,174

100,094

172,270

336,538

39,787

10,153

49,940

Contractual
cash flows

Less than
one year

Between one
and five years

More than
five years

$’000

(64,174)

(128,152)

(194,598)

(64,174)

(25,288)

(27,830)

(73,582)

(166,768)

(29,282)

(386,924)

(117,292)

(240,350)

(29,282)

(39,787)

(12,715)

(52,502)

(39,787)

(6,385)

(46,172)

(6,330)

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

32 FINANCIAL RISK MANAGEMENT (cont.)
MARKET RISK

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and commodity prices will affect the
consolidated entity income or the value of its holdings of financial instruments. Changes in the market gold price will affect the
derivative valuation at each reporting date. The objective of market risk management is to manage and control market risk exposures
within acceptable parameters, while optimising the return.

Hedge accounting

The Group’s risk management policy is to hedge gold sales in local currency as and when appropriate, subject to the terms of the
Syndicated Facility Agreement.

At 30 June 2022 there were commitments over future sales of gold from the King of the Hills operation (refer to note 26). These are
accounted for using the “own use” exemption and are not regarded as financial instruments.

Gold price sensitivity

Derivative financial instruments valued using valuations models with inputs such as forward gold prices, are sensitive to gold price
fluctuations. Currently there are no derivative financial instruments because the Group accounts for gold hedges using the “own use”
exemption (2021: nil).

An increase of 10% or decrease of 10% in the average gold price for the year would have increased/(decreased) equity and profit or
loss by the amounts shown below:

CONSOLIDATED

30 June 2022

Gold sales revenue

30 June 2021

Gold sales revenue

CURRENCY RISK

Profit or loss

Equity

10% increase
$’000

10% decrease
$’000

10% increase
$’000

10% decrease
$’000

16,246

(16,246)

16,246

(16,246)

17,094

(17,094)

17,094

(17,094)

The consolidated entity is exposed to currency risk on investments and purchases that are denominated in a currency other than the
respective functional currencies of the subsidiaries within the consolidated entity being Australian Dollar (A$) and Philippine Pesos. The
currencies in which these transactions primarily are denominated are United States dollars (US$).

The consolidated entity has not entered into any derivative financial instruments to hedge such transactions. The Company’s
investments in its subsidiaries are not hedged as those currency positions are considered to be long term in nature.

INTEREST RATE RISK

The consolidated entity is exposed to interest rate risk, primarily on its borrowings and on its cash and cash equivalents. This is the risk
that a financial instrument’s value will fluctuate as a result of changes in the market interest rates on interest-bearing financial
instruments. The consolidated entity does not currently use derivatives to mitigate these exposures.

For cash and cash equivalents, the consolidated entity adopts a policy of ensuring that any excess cash is utilised to pay down long
term debt under the terms of the Syndicated Facility Agreement.

At the reporting date the interest rate profile of the consolidated entity’s interest-bearing financial instruments was:

Cash and cash equivalents

Restricted cash

Security deposits

Borrowings

2022 ANNUAL REPORT

CONSOLIDATED

Carrying amount

2022

$’000

32,526

7,500

8,177

(172,270)

(124,067)

2021

$’000

17,415

20,500

8,306

46,221

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

32 FINANCIAL RISK MANAGEMENT (cont.)
Cash flow sensitivity analysis for variable rate instruments

An increase of 100 basis points or decrease of 100 basis points in interest rates at the reporting date would have increased/(decreased)
equity and profit or loss by the amounts shown below:

Profit or loss

Equity

100bp increase
$’000

100bp/50bp
decrease
$’000

100bp increase
$’000

100bp/50bp
decrease
$’000

(1,241)

462

1,241

(231)

(1,241)

462

1,241

(231)

CONSOLIDATED

30 June 2022

Variable rate instruments

30 June 2021

Variable rate instruments

NET FAIR VALUES

The carrying value of financial assets and liabilities equates to their fair value.

CAPITAL MANAGEMENT

The consolidated entity’s objective when managing capital is to safeguard its ability to continue as a going concern, so as to maintain a
strong capital base sufficient to maintain future exploration and development of its projects. In order to maintain or adjust the capital
structure, the consolidated entity may return capital to shareholders, issue new shares or sell assets to reduce debt.

Risk management is facilitated by regular monitoring by and reporting to the Board and key management personnel.

Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

33 FAIR VALUE MEASUREMENT
The fair values of financial assets and financial liabilities carried at amortised cost approximate their carrying value.

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique.

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 - Valuation techniques for which the lowest - level input that is significant to the fair value measurement is directly or

indirectly observable

Level 3 - Valuation techniques for which the lowest - level input that is significant to the fair value measurement is unobservable

The following financial assets and liabilities are classified as level 2:

\ Financial liabilities - borrowings of $172.270 million (30 June 2021: $nil)

\ Derivative Financial Instruments, liability of $nil (30 June 2021: $nil)

34 DEED OF CROSS GUARANTEE
Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 the wholly owned subsidiaries listed below are relieved
from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial reports, and Directors’ Reports.

It is a condition of the Instrument that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the
Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of any of the subsidiaries
under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions of the Act, the Company will only
be liable in the event that after six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in
the event that the Company is wound up.

The subsidiaries subject to the Deed are:

\ Opus Resources Pty Ltd

\ Darlot Mining Company Pty Ltd

\ Greenstone Resources (WA) Pty Ltd

Opus Resources Pty Ltd and Darlot Mining Company Pty Ltd both became party to the Deed of Cross Guarantee on 30 June 2018.
Greenstone Resources (WA) Pty Ltd became party to the Deed of Cross Guarantee on 30 June 2021.

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

34 DEED OF CROSS GUARANTEE (cont.)
A consolidated statement of comprehensive income and a consolidated statement of financial position, comprising of the Company and
controlled entities which are party to the Deed, after eliminating all transactions between parties to the Deed of Cross Guarantee, for the
year ended 30 June 2022 is set out as follows:

(a)

Statement of Other Comprehensive Income

CLOSED GROUP

YEAR ENDED

30 June 2022

30 June 2021

Sales revenue

Cost of sales

Gross profit

Other income and expenses

Other income

Administration and other expenses

Exploration expenditure

Operating (loss)/profit

Finance income

Finance expenses

Net financing expense

Profit/(loss) before tax

Income tax (expense)/benefit

(Loss)/profit after tax for the year

Other comprehensive income/(loss)

Changes in fair value of cashflow hedges, net of tax

Ineffective portion of cash flow hedges

$’000

164,962

(196,049)

(31,087)

208

(13,547)

(2,522)

(46,948)

(126,388)

(126,380)

(172,328)

915

(172,413)

(1,444)

$’000

173,358

(171,050)

2,308

527

(11,471)

(3,217)

(11,853)

347

(57,960)

(57,613)

(69,466)

4,788

(64,678)

24,787

(4,748)

Total comprehensive profit/(loss) for the year

(173,857)

(44,639)

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

34 DEED OF CROSS GUARANTEE (cont.)
(b)

Statement of Financial Position

CLOSED GROUP

YEAR ENDED

30 June 2022

30 June 2021

Assets

Cash and cash equivalents

Trade and other receivables

Inventories

Total current assets

Property, plant and equipment

Mine properties

Exploration and evaluation assets

Trade and other receivables

Intangible assets

Investments

Total non-current assets

Total assets

Liabilities

Trade and other payables

Employee benefits

Income tax payable

Borrowings

Lease liabilities

Total current liabilities

Employee benefits

Provisions

Borrowings

Lease liabilities

Deferred tax liability

Total non-current liabilities

Total liabilities

Net assets

Equity

Contributed equity

Other equity

Reserves

Accumulated losses

Total equity

$’000

32,474

18,880

41,415

92,769

303,378

131,273

41,133

7,380

291

658

484,113

576,882

64,987

8,316

19,376

18,490

111,169

739

47,681

152,894

81,604

282,918

394,087

182,795

445,411

930

35,938

(299,484)

182,795

$’000

17,374

9,858

26,572

53,804

136,814

62,882

37,135

50,490

230

658

288,209

342,013

40,953

5,498

3,529

49,980

421

52,926

6,624

1,533

61,504

111,484

230,529

444,877

930

34,041

(249,319)

230,529

2022 ANNUAL REPORT

Notes to the CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2022 (cont.)

35 PARENT ENTITY DISCLOSURES

PARENT ENTITY

30 June 2022

30 June 2021

$’000

(a) Finance position

Assets

Current assets

Non-current assets

Total assets

Liabilities

Current liabilities

Non-current liabilities

Total liabilities

Equity

Contributed equity

Other equity

Reserves

Accumulated losses

Total equity

(b) Finance performance

Profit/(loss) for the year

Other comprehensive income

Total comprehensive profit/(loss) for the year

Low value and short term leases:

- Not later than one year

Total financial commitments

(d)

Contingent liabilities

28,849

292,988

321,837

25,340

153,263

178,603

443,160

930

6,485

(307,341)

143,234

(172,413)

(1,444)

(173,857)

3,595

154,964

158,559

4,246

3,497

7,743

442,626

930

4,587

(297,327)

150,816

(64,678)

20,039

(44,639)

The parent entity did not have any contingent liabilities at 30 June 2022 (2021: $nil).

The parent entity has entered into a Deed of Cross Guarantee with the effect that the Company guarantees debts in respect of
certain subsidiaries.

Further details of the Deed of Cross Guarantee and the subsidiaries subject to the deed are disclosed in Note 34.

36 SUBSEQUENT EVENTS
During the first quarter of FY23, the Darlot Gold Mine’s processing plant was wound down and the Darlot operation has been
transitioned to a satellite underground mine to provide ore to King of the Hills, with the majority of surface employees at Darlot
transitioning or having already transitioned to King of the Hills. As a result, the Darlot process plant was placed into care and
maintenance in July 2022.

Other than the matters discussed above, there has not arisen in the interval between the end of the financial year and the date of
this report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company,
to significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group, in future
financial years.

2022 ANNUAL REPORT

DIRECTORS’ Declaration

The Board of Directors of Red 5 Limited declares that:

(a) the consolidated financial statements, accompanying notes and the remuneration disclosures that are contained in the

Remuneration Report in the Directors’ Report are in accordance with the Corporations Act 2001, including:

\ giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its performance for the financial year

ended on that date; and

\ complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations

Regulations 2001;

(b) the financial report also complies with International Financial Reporting Standards as disclosed in note 2.1; and

(d) Aa the date of the declaration, the Company is within the class of companies affected by ASIC Corporations (Wholly owned

Companies) Instrument 2016/785. The nature of the deed of cross guarantee is such that each company which is party to the deed
guarantees to each creditor payment in full of any debt in accordance with the deed of cross guarantee.

The Board of Directors has received the declaration by the Managing Director and Chief Financial Officer required by Section 295A of
the Corporations Act 2001, for the year ended 30 June 2022.

Signed in accordance with a resolution of the Directors.

Kevin Dundo
Chairman

Perth, Western Australia
31 August 2022

2022 ANNUAL REPORT

Independent AUDITOR’S REPORT

2022 ANNUAL REPORT

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation Independent Auditor’s Report To the shareholders of Red 5 Limited Opinion We have audited the Financial Report of Red 5 Limited (the Company). In our opinion, the accompanying Financial Report of the Company is in accordance with the Corporations Act 2001, including: • giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its financial performance for the year ended on that date; and • complying with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: • Consolidated statement of financial position as at 30 June 2022; • Consolidated statement of profit or loss and other comprehensive income, Consolidated statement of changes in equity, and Consolidated statement of cash flows for the year then ended; • Notes including a summary of significant accounting policies; and • Directors’ Declaration. The Group consists of the Company and the entities it controlled at the year-end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the 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 fulfilled our other ethical responsibilities in accordance with these requirements. Independent AUDITOR’S REPORT (cont.)

2022 ANNUAL REPORT

Key Audit Matters The Key Audit Matters we identified are: • Sales revenue; • Property, plant and equipment and mine properties; and • Going concern basis of accounting. Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. These matters were addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Sales revenue ($164.962 million) Refer to Note 5(a) to the Financial Report The key audit matter How the matter was addressed in our audit Existence and accuracy of sales revenue is a key audit matter due to its significance to the consolidated financial statements combined with the incremental audit effort assessing the application of relevant accounting standards. Gold sales revenue from the Group’s Darlot and King of the Hills (KOTH) operations was the most significant item in the consolidated statement of profit or loss ($164.962 million). We focused on the following judgements the Group applied in determining sales revenue: • Assessing the revenue recognised against the requirements of AASB 15 Revenue form Contracts with Customers; • Judgements made by the Group in the early adoption to forthcoming requirements to AASB 116 Property, Plant and Equipment. Proceeds from sales made from the KOTH operation while in pre-production phase have been recorded in the income statement with a corresponding allocation made to costs of goods sold; and • The application of the “own-use” exemption for gold forward contracts. Our procedures included: • We considered the Group’s accounting policies for the recognition of sales revenue against the requirements of the accounting standards; • For gold sales recognised during the year we obtained the sales invoice and compared the quantity sold against third party statements from the refinery and cash received in the bank; • For a sample of sales recorded close to year end, we tested against the recognition criteria of AASB 15 checking control had passed to the customer to the date of the third party statements; • We evaluated the methodology for allocating costs to inventory for sales made in the KOTH pre-production phase. We tested, on a sample basis, costs allocated against these sales; and • For gold forward contracts where “own-use” exemption was applied, we checked the gold forward contracts, compared to the Group’s gold production forecasts and inquired with finance and operational personnel as to the intention to deliver physical gold in those contracts in accordance with the requirements of the accounting standards to apply the own-use exemption. Independent AUDITOR’S REPORT (cont.)

2022 ANNUAL REPORT

Property, plant and equipment ($303.4m) and mine properties ($131.4m) Refer to Notes 10 and 11 to the Financial Report The key audit matter How the matter was addressed in our audit Existence, accuracy and valuation of expenditure capitalised as an asset as part of the Group’s mining operations was considered to be a key audit matter. Additions to Property, Plant and Equipment ($198.5 million) and Mine Development ($82.7 million) primarily related to construction of the King of the Hills (KOTH) project. Of the additions to Property, Plant and Equipment $99.5 million relates to right of use assets, which is largely leases embedded in supply contracts relating to the establishment of the KOTH mining operations. Property, Plant and Equipment and Mine Development represents 75% of total assets of the Group. The Group used judgement in the identification and allocation of cost between operating and capital expenditure. The risks we focused on include: • the existence of expenditure capitalised; • the methodology used to allocate costs between operating expenditure (including inventory stockpiles), capital expenditure and exploration & evaluation assets; • the relative magnitude of lease liabilities right-of-use assets added during the year pursuant to AASB 16 “Leases”. A focus for us was the completeness of leases to be recognised and the accuracy of multiple inputs which may drive different accounting outcomes, including key terms of the lease agreements, such as commencement dates, fixed and variable payments, renewal and termination options; and • the assessment of the existence of impairment or reversal indicators of the non-financial assets contained within Group’s CGUs. Our procedures included: • Test of controls and inputs relating to the authorisation and accuracy of the recording, classification and payment of expenditure; • Assessment of the allocation of costs between operating expenditure (including inventory stockpiles), capital expenditure and exploration & evaluation assets by inspecting documentation on a sample basis and assessing the nature of the underlying activity; • Selecting a sample of supplier and contractor invoices raised during the year. We checked the timing and nature of recorded expenditure against the details of the service description on the invoice or contract; • We compared the key inputs adopted by the Group in its AASB 16 lease calculations against underlying source documents including signed agreements and lessor’s invoices; • We assessed the completeness of leases recognition by understanding the Group’s process to identify leases within contracts, and by inspecting a sample of non-lease agreements for the existence of potential embedded leases; and • Challenging the Group’s assertion as to the presence of no impairment or reversal indicators. This included assessing the composition of the KOTH mining hub CGU. Independent AUDITOR’S REPORT (cont.)

2022 ANNUAL REPORT

Going concern basis of accounting Refer to Note 2.2 to the Financial Report The key audit matter How the matter was addressed in our audit The Group’s use of the going concern basis of accounting is a key audit matter due to the level of judgement required by us in evaluating the Group’s assessment of going concern. These are outlined in Note 2.2. The Directors have determined that the use of the going concern basis of accounting is appropriate in preparing the financial report. Their assessment of going concern was based on cash flow projections. The preparation of these projections incorporated a number of assumptions and significant judgements. We critically assessed the judgements focusing on the following: • the Group’s significant cash inflow assumptions particularly forecast production volumes, impact of future commodity prices and foreign exchange rates to cash inflows projected; • the Group’s planned levels of operational and capital expenditures, and the ability of the Group to manage cash outflows within available funding; • the Group’s ability to meet financing commitments and covenants. This included nature of planned activities to achieve this and status/progress of those plans; and • the Group’s ability to source suitable funding solutions. In assessing this key audit matter, we involved senior audit team members who understand the Group’s business, industry and the economic environment it operates in. Our procedures included: • We analysed the cash flow projections by: • Evaluating the underlying data used to generate the projections. We specifically looked for consistency of information used with the Group’s intentions, as outlined in Directors minutes and the KOTH feasibility study; • Analysing the impact of reasonably possible changes in projected cash flows and their timing, to the projected periodic cash positions. Assessing the resultant impact to the ability of the Group to pay debts as and when they fall due and continue as a going concern including ability to meet financing commitments and covenants. The specific areas we focused on was gold production sensitivities given the ramp up of production at KOTH; • Assessing the Group’s significant cash inflow assumptions and judgements for feasibility and timing. We used our knowledge of the client, its industry, published views of market trends and conditions to assess the level of associated uncertainty; and • Assessing the planned levels of operating and capital expenditures for consistency of relationships and trends to the Group’s actual results, results since year end, and our understanding of the busines and industry including KOTH’s feasibility study. • We read correspondence to assess the timing and magnitude of suitable funding options. • We evaluated the Group’s going concern disclosures in the financial report by comparing them to our understanding of the matter, the events or conditions incorporated into the cash flow projection assessment, the Group’s funding plans or conditions and accounting standard requirements. Independent AUDITOR’S REPORT (cont.)

2022 ANNUAL REPORT

Other Information Other Information is financial and non-financial information in Red 5 Limited’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are responsible for the Other Information. The Other Information we obtained prior to the date of this Auditor’s Report was the Directors’ report and the Corporate Directory. The Chairman’s Review, Managing Director’s Report, Resources and Reserves Statement, Tenement Schedule and Statement of Shareholders are expected to be made available to us after the date of the Auditor's Report. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors are responsible for: • preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; • implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and • assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so. Independent AUDITOR’S REPORT (cont.)

2022 ANNUAL REPORT

Auditor’s responsibilities for the audit of the Financial Report Our objective is: • to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and • to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our Auditor’s Report. Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Red 5 Limited for the year ended 30 June 2022 complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in the Directors’ report for the year ended 30 June 2022. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. KPMG R Gambitta Partner Perth 31 August 2022 Statement of SHAREHOLDERS as at 25 August 2022

DISTRIBUTION OF SHARE AND RIGHTS HOLDERS

1,001

5,001

10,001

100,001

1,000

5,000

10,000

100,000

and over

Including holdings of less than a marketable parcel
(based on a market share price of $0.275 per share)

CLASSES OF SHARES AND VOTING RIGHTS

Number of holders

Fully paid shares

Unlisted rights

711

2,841

1,748

4,627

1,112

11,039

1,237

106

122

At meetings of members or classes of members, each member entitled to vote may vote in person or by proxy or attorney. On a show
of hands every holder of ordinary shares present at a meeting in person or by proxy is entitled to one vote, and on a poll, every person
present in person or by proxy has one vote for each ordinary share held.

TWENTY LARGEST HOLDERS OF FULLY PAID SHARES

Shareholder

10.

11.

12.

13.

HSBC Custody Nominees (Australia) Limited

Citicorp Nominees Pty Ltd

JP Morgan Nominees Australia Pty Ltd

BNP Paribas Noms Pty Ltd

VBS Exchange Pty Ltd

Broadgate Investments Pty Ltd

BNP Paribas Nominees Pty Ltd

UBS Nominees Pty Ltd

National Nominees Limited

VBS Exchange Pty Ltd

VSG Resources Pty Ltd

14. Gary B Branch Pty Ltd

15.

16.

17.

18.

19.

20.

VSG Resources Pty Ltd

Raylou Investments Pty Ltd

HSBC Custody Nominees (Australia) Limited

John Colin Loosemore and Susan Loosemore

Vicki Leith Jackson

626,927,469

279,195,060

263,885,888

104,747,383

72,273,918

50,000,000

40,000,000

34,187,439

30,091,574

26,211,196

24,159,948

20,697,674

16,500,000

15,085,770

11,190,476

11,077,051

8,842,326

7,893,606

7,697,068

7,659,062

26.60

11.85

11.20

4.44

3.07

2.12

1.70

1.45

1.28

1.11

1.03

0.88

0.70

0.64

0.47

0.37

0.33

0.32

1,658,322,908

70.36

2022 ANNUAL REPORT

Statement of SHAREHOLDERS as at 25 August 2022 (cont.)

SUBSTANTIAL SHAREHOLDERS

The following shareholders have lodged a notice of substantial shareholding in the Company.

Shareholder

Victor Smorgon Partners Pty Ltd

Franklin Resources Inc

Ruffer LLP

UNQUOTED SECURITIES

The following classes of unquoted securities are on issue:

Number of shares

354,882,605

256,750,994

136,701,036

15.06

10.89

5.80

Holders of greater than 20% of each class of security

Security

Number on issue

Name of holder

Number

Performance rights (2023)

Project Incentive Opportunity
performance rights (2023)

Performance rights (2024)

Service Rights

7,945,729

11,550,613

18,410,000

1,672,300

CORPORATE GOVERNANCE STATEMENT

The Company’s 2022 corporate governance statement can be viewed at
https://www.red5limited.com/site/about-red5/corporate-governance

CORPORATE Directory

BOARD OF DIRECTORS

SHARE REGISTRY

Automic Pty Ltd
Level 5
191 St Georges Terrace
Perth WA 6000

Telephone: 1300 288 664
E-mail: hello@automicgroup.com.au
Web-site: www.automicgroup.com.au

BANKERS

Hongkong and Shanghai Banking
Corporation Limited
Macquarie Bank Limited
BNP Paribas

Kevin Dundo (Chairman)
Mark Williams (Managing Director)
Ian Macpherson (Non-Executive Director)
Colin Loosemore (Non-Executive Director)
Steven Tombs (Non-Executive Director)
Andrea Sutton (Non-Executive Director)
Fiona Harris (Non-Executive Director)

COMPANY SECRETARY

Frank Campagna

REGISTERED OFFICE

Level 2
35 Ventnor Avenue
West Perth Western Australia 6005

Telephone: (61-8) 9322 4455
E-mail: info@red5limited.com
Web-site: www.red5limited.com

AUDITORS

KPMG

SOLICITORS

HopgoodGanim

STOCK EXCHANGE
LISTING

Australian Securities Exchange
Trading code: RED

2022 ANNUAL REPORT

ABN 73 068 647 610