2021 Annual Report
11
Resolute Mining Limited 2021 Annual ReportOverviewConsolidated income statement (continued)for the year ended 31 December 2021Financial Report Resolute Mining Limited 2021 Annual Report CONTENTS
About Resolute
From the Chairman
Resolute’s Purpose and Values
From the CEO
Highlights
Board of Directors and Leadership Team
Sustainability at Resolute
Operations Review
Ore Reserves and Mineral Resources
Financial Review
Risk Management
Corporate Governance
Financial Report
Corporate Directory
SCOPE OF THIS REPORT
Resolute Mining Limited’s 2021 Annual Report presents
the Company’s operating and financial results for the
period from 1 January 2021 to 31 December 2021.
It has been prepared for stakeholders in line with
statutory and regulatory reporting obligations.
Resolute is a successful gold focused miner. This report
outlines Resolute’s operational and financial performance
and details the Company’s efforts in 2021 to deliver
long-term value to stakeholders in a manner that reflects
company values.
All references to Resolute, the Company, we, us and our,
refer to Resolute Mining Limited (ABN 097 088 689) and
its subsidiaries. All dollar figures are in United States dollar
currency, unless otherwise stated.
All references to 2021 are for the 12-month period from
1 January 2021 to 31 December 2021, unless otherwise stated.
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Resolute Mining Limited 2021 Annual ReportOverviewConsolidated income statementfor the year ended 31 December 2021Financial ReportResolute Mining Limited 2021 Annual Report
About Resolute
Resolute is an experienced
explorer, developer and
operator of gold mines.
Resolute currently owns two producing gold mines,
the Syama Gold Mine in Mali (Syama) and the Mako
Gold Mine in Senegal (Mako).
The Company’s Global Mineral Resource of 9.5Moz
is based on the most recent Ore Reserve and Mineral
Resource update included in this report.
Syama is a robust, long-life asset which is expected
to produce 220,000oz of gold in 2022 from existing
processing and mining infrastructure.
Mako is an open pit gold mine which Resolute has owned
and operated since August 2019.
The Company is also active in exploration with drilling
campaigns underway across its African tenements with
a focus on Mali, Senegal and Guinea.
The Company trades on the Australian Securities Exchange (ASX)
and the London Stock Exchange (LSE) under the ticker RSG.
2O21 AT A GLANCE
$549million
Revenue
$148million
Operating Cash Flow(*)
$89million
Cash and Bullion(*)
$130million
EBITDA(*)
$367million
Net Loss After Tax
$229million
Net Debt(*)
(*)
These balances are non-IFRS information and have not been audited.
Resolute Mining Limited 2021 Annual Report
11
Resolute Mining Limited 2021 Annual ReportOverview
From the Chairman
From the
Chairman
The year has been one
of the most challenging
in our history and I’d like
to acknowledge the Teams
response and unwavering
drive to deliver against
objectives. I believe the fruits
of their efforts are starting
to show through.
Martin Botha
Chairman
2
Resolute Mining Limited 2021 Annual Report
2021 was a challenging year with continued operational issues
at Syama. I do need to start by once again paying tribute to the
incredible resilience and adaptability of the entire Resolute team.
The year has been one of the most challenging in our history
and I’d like to acknowledge their response and unwavering drive
to deliver against objectives. I believe the fruits of their efforts
are starting to show through.
From a Board and managerial perspective, 2021 saw further
changes to our leadership. Peter Sullivan retired from the Board
after six years of service. Prior to his time on our Board, he had
also served as Resolute’s CEO and we thank him for his huge
contribution and enduring legacy to the Company.
Other Board membership changes include the appointment of
Adrian Reynolds, bringing a wealth of experience in operations
throughout Africa, and Simon Jackson bringing significant
African commercial and financial experience.
Yasmin Broughton, who resigned from the Board in November,
provided valuable legal and commercial acumen as we
undertook a number of key transactions during her tenure.
A capable executive team has now been established with the
permanent appointment of Stuart Gale as Chief Executive Officer,
Terry Holohan as Chief Operating Officer, Doug Warden as Chief
Financial Officer and Richard Steenhof as Company Secretary.
Your board has full confidence in this team. Their collective
expertise has already delivered a stronger focus on operational
improvement with initial results confirming the strategic
changes identified by the team are having a positive impact.
In the 2020 report we acknowledged that the Company required
urgent focus to deliver consistent operational performance
at our flagship Syama mine in order to deliver value to
shareholders. We committed to ensure significant progress in
this regard during 2021 and beyond.
Establishing a stable and appropriately skilled leadership team,
with further positive changes at the operational level, was critical
in order to begin to deliver against this objective. The positive
impact being seen at the operational level will begin to show
on the bottom-line as we move forward. More detail on this is
provided in both the CEO message and operational overview.
Accordingly, Resolute’s financial performance in 2021 does not
yet reflect the positive impact from these production related
initiatives. Financial results are representative of this journey and
incorporate the non-cash impacts of impairment charges at the
Syama and Mako operations, historical tax expenses, together
with non-cash inventory and foreign exchange movements.
A key priority during 2021 was to further develop and engrain
the best sustainability practices into our activities. We have
once again taken great care to ensure we have operated
responsibly and with consideration for the health and safety of
our employees, the communities within which we operate, and
the environment around us.
In 2021, Resolute continued to refine its leadership frameworks,
systems, protocols and management standards in line
with these and other leading practice guidance and is now
benchmarked at the 70th percentile of the S&P Global Corporate
Sustainability Assessment (CSA) of all participants, up from the
45th percentile in 2020.
This represents a significant year-on-year improvement and
is testament to the great team effort that is occurring across
the Group to improve the breadth and depth of Resolute’s
sustainability capacity.
Thank you for your support during 2021. I look forward to
reporting further progress during 2022.
Resolute’s Purpose and Values
OUR PURPOSE
We are a trusted and responsible
gold miner, driven by excellence
to create value for shareholders
and the communities in which
we operate.
OUR VALUES
R
ESPE C T
A
C
C
UNT A B I LIT
O
Y
Respect
We respect each
other and the countries
and communities in
which we operate
Accountability
We own our actions
and deliver on our
commitments
I
NTEG R I
Y
T
Integrity
We are ethical,
open and honest
S
U
S
TAINA B I
Y
L IT
Sustainability
We prioritise health, safety
and environment, operating
responsibly to manage
risk and opportunity
Empowerment
We set ambitious goals,
foster high performance
and support our people
to generate new ideas
E
M
OWE R M E NT
P
Resolute Mining Limited 2021 Annual Report
3
Resolute Mining Limited 2021 Annual ReportOverview
From the CEO
From the CEO
In 2021, Resolute pursued operational improvement
and efficiency initiatives through the re-establishment
of core expertise at our operations while focussing on
system and process improvements. These initiatives will
ultimately drive excellence and provide the platform for
growth while staying true to our people-first mindset.
Operationally, keeping our sites safe and productive was a
key priority throughout the year. We continued to respond to
COVID-19 through our robust plan and adjusted the way we
operate to meet the pandemic’s continually evolving demands.
The vaccination programs we put in place, through partnering
with the Governments of Mali and Senegal, have seen
approximately 2,000 employees and contractors double
vaccinated, safeguarding their well-being and supporting
the communities in which we operate.
In addition, to the challenges of COVID-19, we were also
able to overcome disruptions associated with sanctions
placed on Mali following political coups during the year.
Navigating these challenges required a constant focus,
and I am incredibly proud of the entire Resolute team for
maintaining that focus while simultaneously pursuing
improved operational results.
Together, we overcame major challenges, grew increasingly
knowledgeable about the potential of our sites, implemented
widespread operational improvements, achieved important
strategic milestones and ensured our business maintains a
good environmental footprint and safety record.
The overall result is that Resolute has emerged as an
increasingly resilient, consolidated and future-ready company.
Thanks to our people, their expertise and commitment,
we can look towards 2022 with increasing confidence as we
capitalise on our asset base with a clear line of sight towards
long-term growth.
We completed a number of critical strategic milestones which
include construction of our Syama Power Station and the sale
of the Bibiani Gold Mine and Cote D’Ivoire exploration interests.
Further, our work to analyse and understand site potential
has allowed us to identify and implement unique solutions
to turnaround performance into the future with improvements
to many operating systems including implementation of the
Mill Slicer at Mako and Onstream Analyser at Syama.
Collectively, these activities demonstrate our continued
commitment to delivering a consolidated, increasingly
productive operation, focused on moving down the cost-curve.
From a performance perspective, we produced
319.3 thousand ounces (koz) of gold at an All-In
Sustaining Cost of $1,370 per ounce.
Group Revenue was $549.2 million and resulted in
underlying earnings before interest, tax, depreciation and
amortisation of $129.9 million. The underlying net loss after
tax of $367.4 million was driven by a number of one off
non-cash items associated with impairment of assets,
fair value adjustments and tax charges.
Over the year, steady production at the Mako mine in
Senegal was supported by improving results from the
Sulphide operations at the Syama mine in Mali.
Mako continued to deliver consistently strong results and
cash flows. Its consistent ore grades and metallurgical
characteristics supported reliable production rates. Mako
delivered a solid production result with 126.6koz of gold
being poured at an AISC of $1,139/oz.
At Syama, sulphide gold production increased due to higher
rates of underground mining and processing. However during
2021, Syama oxide production was lower as we transitioned to
multiple satellite pit operations and an extended wet season
which impacted the development and ramp-up of Tabakoroni
and Beta pits. Gold production at Syama during 2021 totalled
192.7koz at an AISC of $1,434/oz.
While these results aren’t where we expected them to be,
our work during 2021 has identified solutions to performance
issues and driven a shift in momentum towards a culture of
continuous improvement.
As we look to the future, building on the momentum of 2021 and
capitalising on the systems and processes adopted, supports
the long-term value of our existing asset base. This positions
us to strengthen our balance sheet and consider growth
opportunities. This won’t happen overnight and we need to pay
detailed attention to the fundamentals of our business to embed
systemic improvements that ultimately deliver cost-efficiencies
and productivity improvements.
This will again require our people to show their adaptability.
I personally see that the key to our success will be building
a values-based culture where our people are empowered,
accountable and operate with integrity. During 2021, we
reviewed our operating structure and we now have stable
leadership in place to drive this culture.
As I look towards 2022, I am energised by our work to date.
We enter the new year in a stronger position and can build on
our efforts to simplify our business, deliver operational outcomes
and create sustainable value for all stakeholders.
Thank you for your support.
Stuart Gale
Managing Director and Chief Executive Officer
4
Resolute Mining Limited 2021 Annual Report HIGHLIGHTS
For the year ending 31 December 2021
GOLD PRODUCTION
319,271oz
ALL-IN SUSTAINING COST
$1,370/oz
TOTAL GOLD SOLD
316,464oz
AVERAGE PRICE RECEIVED
$1,733/oz
Highlights
Resolute Mining Limited 2021 Annual Report
5
5
Resolute Mining Limited 2021 Annual ReportOverview
Board of Directors and Leadership Team
The Board
Stuart Gale
BEcon, FCA
Managing Director
and Chief Executive Officer
Martin Botha
BScEng
Non-Executive Chairman
Mark Potts
BSc (Hons), GAICD
Non-Executive Director
Sabina Shugg
BSc (Mining Engineering), MBA, GAICD
Non-Executive Director
Adrian Reynolds
MSc, GradDipMinEng
Non-Executive Director
Simon Jackson
B.Com FCA
Non-Executive Director
Leadership Team
Terry Holohan
BSc CEng MIMMM
Chief Operating Officer
Doug Warden
BCom, CA and MBA (Exec)
Chief Financial Officer
Richard Steenhof
LLB (Dist.)
Manager Legal and Company Secretary
David Kelly
BSc (Hons)
Executive General Manager
– Strategy and Development
Jordan Morrissey
MSc (Organisational Psychology)
Executive General Manager
– Sustainability
Bruce Mowat
BSc (Geology)
Executive General Manager
– Exploration
6
Resolute Mining Limited 2021 Annual Report THE BOARD
Stuart Gale
BEcon, FCA
Managing Director
and Chief Executive Officer
Mr Gale was appointed as Chief
Executive Officer and Managing
Director in May 2021 after serving
as the Chief Financial Officer since
January 2020. Mr Gale is Chair of the
Sustainability Committee.
Skills, experience and expertise
Mr Gale is a Chartered Accountant with
extensive management experience.
Prior to joining the Company, Mr Gale
was Group Manager Corporate Finance
for Fortescue Metals Group Limited
(FMG). Since joining FMG in 2010,
Mr Gale was responsible for FMG’s
funding, risk, and treasury functions
as well as statutory, management
and project accounting, budgeting,
forecasting, accounts payable and
investor relations programs.
During FMG’s expansion period,
Mr Gale ensured robust systems
and processes were developed and
implemented in addition to co-ordinating
external and internal finance functions.
More recently, the development of FMG’s
refinancing strategies to result in a low-
cost, flexible, long dated debt portfolio
that supports the company’s ongoing
growth was part of Mr Gale’s role.
Mr Gale has strong global relationships
with banks, ratings agencies,
shareholders, debt holders and investors
that are highly beneficial to Resolute.
Mr Gale is a Fellow of the Institute
of Chartered Accountants in Australia,
a member of the Australian Institute of
Company Directors and a Fellow
of Leadership Western Australia.
Current listed directorships
• None
Other current directorships/
appointments
•
World Gold Council Ltd
(appointed 2021)
Board of Directors and Leadership Team
Martin Botha
BScEng
Non-Executive Chairman
Mark Potts
BSc (Hons), GAICD
Non-Executive Director
Mr Martin Botha was appointed
Chairman in June 2017 after being
appointed to the Board in February 2014.
Mr Botha is Chair of the Nomination
Committee and a member of the
Audit and Risk Committee and the
Remuneration Committee.
Mr Mark Potts was appointed to the
Board as a Non-Executive Director
in June 2017. Mr Potts is Chair of the
Remuneration Committee (from
20 February 2020), and a member of
the Audit and Risk Committee and the
Nomination Committee.
Skills, experience and expertise
Mr Botha is an investment banker
with extensive experience as a non-
executive director in the metals and
mining industry and regulated
financial markets.
Mr Botha led the establishment and
development of Standard Bank’s core
global natural resources trading and
financing franchise across all continents
as a founding director in their London
centred international operations. He
brings this insight and experience of
global commodity markets as well as
mining financing and M&A transactions
to the Board.
Mr Botha is active in assisting early-stage
mining opportunities in Africa and has
a broad strategic understanding of the
resources industry and its cyclical nature.
He brings deep experience in
governance through his board level
roles in highly regulated institutions in
several global financial centres.
Mr Botha currently chairs a private
company building digital marketplaces.
Mr Botha graduated with first class
honours from the University of Cape
Town and is based in London.
Current listed directorships
•
Non-Executive Director of Zeta
Resources Limited
(appointed 2013)
Other current directorships/
appointments
• Non-Executive Chair of NovaFori
(formerly Perfect Channel Ltd)
(appointed 2017)
Skills, experience and expertise
Mr Potts is a leading global technology
and business executive. He has founded
multiple venture backed technology
and technology services companies
in Australia, the UK and the US. Most
recently, Mr Potts was a HP Fellow and
Chief Technology Officer/Vice President
of Corporate Strategy at Hewlett-Packard
Enterprise in the US, leading their efforts
in both M&A, technology investment and
capital strategy.
Mr Potts is and has been a non-executive
director and chairman at several
ASX-listed technology companies that
are involved in disruption within both
financial services/ superannuation,
security/surveillance automation and
government service digitisation. He
has deep expertise in technology lead
innovation leveraging Robotic Process
Automation, AI/machine learning, and
Blockchain technology, as well as public
policy change and privatisation of
government soft assets into public and
private partnership.
Mr Potts has worked across multiple
jurisdictions including the UK, Europe,
US and Asia Pacific.
Mr Potts is also a non-executive director
at Linear Clinical Research Limited, a
purpose built state-of-the-art, clinical
trials facility and a focal point for
Australian clinical and medical research.
Mr Potts is a Member of the Australian
Institute of Company Directors.
Current listed directorships
• Non-Executive Chairman of
iCetana Ltd (appointed 2018)
Other current directorships/
appointments
• Non-Executive Director of Linear
Clinical Research Limited
(appointed 2019)
• Non-Executive Director of Land
Services WA
(appointed 2019)
7
Resolute Mining Limited 2021 Annual Report
Board of Directors and Leadership Team
Sabina Shugg
BSc (Mining Engineering), MBA, GAICD
Non-Executive Director
Adrian Reynolds
MSc, GradDipMinEng
Non-Executive Director
Simon Jackson
B.Com FCA
Non-Executive Director
Ms Sabina Shugg was appointed
to the Board as a Non-Executive
Director in September 2018. Ms Shugg
is a member of the Remuneration
Committee, the Sustainability Committee,
the Audit and Risk Committee and the
Nomination Committee.
Mr Adrian Reynolds was appointed
to the Board as a Non-Executive
Director in May 2021. Mr Reynolds is a
member of the Nomination Committee,
the Audit and Risk Committee, the
Sustainability Committee and the
Remuneration Committee.
Mr Simon Jackson was appointed to the
Board as a Non-Executive Director in
October 2021. Mr Jackson is Chair of the
Audit and Risk Committee, and a member
of the Nomination Committee and the
Remuneration Committee.
Skills, experience and expertise
Mr. Jackson is a Chartered Accountant
with over 25 years’ experience in
management of resource companies,
particularly in Africa. Mr. Jackson was
a key member of the management team
of TSX listed Red Back Mining Inc., a
company that financed, developed and
operated two gold mines in West Africa
culminating in a takeover by Kinross
Gold Corp in 2010. He was then founding
President and CEO, and later Chairman,
of TSXV listed Orca Gold Inc, a company
which discovered and is advancing the
Block 14 gold project in Sudan.
Mr. Jackson has previously been
a director of multiple ASX and TSX
listed companies including Cardinal
Resources Limited.
Current listed directorships
•
Non-Executive Chairman of Sarama
Resources Limited (appointed March 2011)
• Non-Executive Director of Cygnus
Gold Limited (appointed November 2017)
• Non-Executive Chairman of Predictive
Discovery Limited (appointed October 2021)
Skills, experience and expertise
Mr. Reynolds has more than 40 years
of experience in senior management
and advisory roles in the natural
resources sector, including almost
25 years of experience with Randgold
Resources and its predecessors.
His particular areas of expertise
include feasibility studies, project
evaluation, technical due-diligence,
ore resource/reserve estimation and
environmental studies.
Mr. Reynolds is a Fellow of the Institute
of Materials, Minerals and Mining and is
also a Fellow of the Geological Society
of South Africa. He is a registered
Professional Natural Scientist and
holds a Master of Science in Geology
obtained from Rhodes University in
1979, as well as a Graduate Diploma in
Engineering obtained from the University
of Witwatersrand in 1987.
Current listed directorships
• Non-Executive Director of Sylvania
Platinum Ltd (appointed 2021)
Other current directorships/
appointments
• None
Other current directorships/
appointments
• None
Skills, experience and expertise
Ms Shugg is a mining engineer with over
30 years’ experience involving senior
operational roles with leading mining
and consulting organisations including
Normandy, Newcrest, and KPMG.
Ms Shugg has extensive experience in
senior roles with mining and consulting
organisations including operations
management experience at senior site
level covering both underground and
open pit environments. Ms Shugg’s work
has a strong people focus, together with
a solid project management background.
Ms Shugg currently serves as the
Director of the Kalgoorlie Campus for
Curtin University – WA School of Mines
with a focus on industry engagement
and taking mining education into a
digital future.
In her role as Founder and Chair of
Women in Mining and Resources WA
(WIMWA), Ms Shugg was awarded the
inaugural Women in Resources Champion
by the Chamber of Minerals and Energy
of Western Australia for being an
outstanding role model for the resources
industry and broader community. In 2015,
Ms Shugg was awarded a Member of the
General Division of the Order of Australia
for significant service to the mining
industry through executive roles in the
resources sector and as a role model and
mentor to women.
Ms Shugg is a Member of the Australian
Institute of Company Directors.
Current listed directorships
• None
Other current directorships/
appointments
• Director of WIMWA Events Pty Ltd
(appointed 2007)
• Non-Executive Director of the
Australian Prospectors and Miners’
Hall of Fame Ltd (appointed 2014)
• Non-Executive Director of the
Mining Hall of Fame Pty Ltd
(appointed 2016)
• Director of the Kalgoorlie Campus for
Curtin University – WA School of Mines
(appointed July 2019)
• Chair of the Goldfields Esperance
Development Commission
(appointed September 2020)
8
Resolute Mining Limited 2021 Annual Report Overview
Board of Directors and Leadership Team
Resolute Mining Limited 2021 Annual Report
9
Overview
Board of Directors and Leadership Team
LEADERSHIP TEAM
Terry Holohan
BSc CEng MIMMM
Chief Operating Officer
Doug Warden
BCom, CA and MBA (Exec)
Chief Financial Officer
Mr Terry Holohan joined Resolute in
2021 as Chief Operating Officer
responsible for all aspects of the
Company’s operations and projects.
Mr Holohan has held various executive
and detailed technical mining positions
working in Africa, for 30 years, followed
by 10 years in Asia, focused on re-
engineering a range of precious and
base metals mining projects.
Mr Holohan brings significant experience
in operating in technically and socially
challenged environments where he has
led multi-cultural workforces.
Mr Doug Warden was appointed as Chief
Financial Officer in September 2021 bringing
with him over 25 years of experience leading
the financial, strategic and commercial
functions of businesses in the natural
resources and agricultural sectors.
Prior to Resolute, Doug was the CFO at
CBH Group. Prior to CBH, Doug spent
15 years in the mining industry, primarily
with ASX-listed Iluka Resources. While
at Iluka, Doug held a number of senior
executive positions including CFO, Head
of Resource Development and General
Manager Business Development. In
addition to his key financial, planning and
investor responsibilities, Doug has also
had broad experience in international
operations in Sierra Leone, Sri Lanka
and the United States.
Richard Steenhof
LLB (Dist.)
Manager Legal and Company Secretary
Mr Richard Steenhof is a corporate
lawyer who joined Resolute in 2019
and in 2021 was appointed as the
Company’s Senior Legal Counsel
and Company Secretary.
Prior to joining Resolute, Mr Steenhof
practiced for 11 years at leading
international law firms in the general
energy and natural resources space.
He has broad experience in a wide range
of matters in the sector including M&A,
projects, finance and corporate advisory.
David Kelly
BSc (Hons)
Executive General Manager
– Strategy and Development
Jordan Morrissey
MSc (Organisational Psychology)
Executive General Manager
– Sustainability
Bruce Mowat
BSc (Geology)
Executive General Manager
– Exploration
Mr David Kelly joined Resolute in 2016
as General Manager Corporate Strategy
and from 2019-2021 was Chief Operating
Officer. Mr Kelly is currently Executive
General Manager Strategy and Business
Development. An experienced geologist
and Company Director, Mr Kelly has
served in various senior executive roles in
the resources sector for the last 30 years
including as an investment banker and
corporate advisor.
In addition, Mr Kelly has previously
served as a director of ASX-listed
companies Turaco Gold Limited,
Predictive Discovery Limited, Ridge
Resources Limited, Renaissance Minerals
Limited and Pacific Ore Limited.
Mr Jordan Morrissey joined Resolute
in 2020 as Executive General Manager
Sustainability and is responsible for all
aspects of the Company’s Sustainability
Divisions (People and HSSEC), including
the implementation of the Group
Sustainability Strategy.
An experienced mining professional,
Mr Morrissey has more than 15 years
global mining experience and most
recently held the Chief People Officer
role for Syrah Resources Limited.
Mr Bruce Mowat joined Resolute in
2011 and is currently Executive General
Manager Exploration, responsible for the
Company’s exploration and development
programs in Australia, Africa and other
jurisdictions.
Mr Mowat has spent 30 years exploring
for and finding gold and base metal
deposits in Australia, PNG, Indonesia and
West Africa and has held senior positions
in a number of companies.
Prior to joining Resolute Mr Mowat
was Chief Geologist for Straits
Resources. Mr Mowat is currently a
non-executive director of ASX-listed
Turaco Gold Limited.
10
Resolute Mining Limited 2021 Annual Report
Sustainability
at Resolute
11
Resolute Mining Limited 2021 Annual ReportSustainability Report Sustainability at Resolute
As a member of the World Gold Council (WGC), Resolute is committed to
operating responsibly in accordance with the Responsible Gold Mining
Principles (RGMPs) from mine development through to closure.
In 2021, Resolute continued to refine its leadership frameworks,
systems, protocols and management standards in line with
these and other leading practice guidance.
Priorities and targets have been identified under each of
these and Resolute will continue to monitor and report
performance in accordance with:
Year two self-assessment efforts has identified Resolute to
be in excess of 65% compliant with the RGMPs. London based
firm, Kumi Consulting, have been engaged to provide external
assurance of Resolute’s compliance against the RGMPs and
the Conflict Free Gold Standard in 2022 and beyond. This
means the Company is on track to achieve full alignment
by mid 2023 in accordance with the WGC timeframe.
Sustainability is a core organisational value at Resolute.
This sends a very clear message to staff, investors and
stakeholders that performance across all environmental,
social and governance (ESG) areas is prioritised, non-negotiable
and an important differentiator in a competitive gold industry.
Resolute’s Sustainability Strategy continues to evolve as
the Company’s understanding of ESG risk and opportunity
at our assets matures. Resolute’s Sustainability Strategy is
illustrated below.
The Company’s Sustainability Strategy contains four key
strategic pillars.
• The Global Reporting Initiative
• Sustainable Development Goals
• IFC performance standards
• The UN Guiding Principles on Human Rights
• Other ESG guidance relevant to the resources sector.
In 2021, Resolute continued to report against the S&P Global
Corporate Sustainability Assessment (CSA) and is now
benchmarked at the 70th percentile of all participants,
up from the 45th percentile in 2020. This represents a
significant year-on-year improvement and is testament to the
great team effort that is occurring across the Group to improve
the breadth and depth of Resolute’s sustainability capacity.
Resolute is proud to have published its second Group
Sustainability Report in 2021, to voluntarily disclose its
key activities, programs and achievements. Resolute’s
2021 Sustainability Report is available to download on
the Company’s website at rml.com.au.
OSE: O p era t e r e
Transp are n t
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12
Resolute Mining Limited 2021 Annual ReportSustainability Report
Operations
Review
Resolute Mining Limited 2021 Annual Report
1313
Resolute Mining Limited 2021 Annual ReportOperations Review
Overview
With 30 years’ experience, Resolute is an experienced gold miner with
the skills and expertise to maximise the potential of its operations.
During 2021, Resolute continued to focus on operational
excellence and continuity with a view to increasing
productivity. During 2021, Resolute poured 319.3koz of gold
at an AISC of $1,370/oz, while significant enhancements
were achieved at both operations, which will benefit the
businesses going forward.
Syama and Mako produced a record 6.2 million tonnes (Mt)
of ore. The processing plants subsequently milled 5.6Mt of ore
at an average grade of 2.06 grams per tonne of gold (g/t), while
stockpiling lower grade ores, at a recovery of 84.8% for 316.5koz
of gold recovered.
This performance was achieved while the Company faced
ongoing challenges presented by the COVID-19 pandemic.
Steady production at the Mako mine in Senegal was supported
by improved results from the Sulphide operations at the
Syama mine in Mali.
The Company’s mines in Mali and Senegal provide a strong
platform for organic growth. This is reflected at Syama where
Ore Reserve of 3.4Moz are supported by a pipeline of exploration
projects, which are expected to systematically increase production
and extend the life of the Syama operation. In Senegal Resolute
continues to evaluation near mine exploration opportunities to
extend the operations at Mako.
Our operations
UNITED KINGDOM
London
4,059
EMPLOYEES AND CONTRACTORS
AFRICA
MALI
Syama Gold Mine
SENEGAL
Mako Gold Mine
14
AUSTRALIA
Perth
Resolute Mining Limited 2021 Annual ReportOperations Review Mine Operations Review
for the year ended 31 December 2021
Total Ore Mined
Total Ore Processed
Grade Processed
Recovery
Gold Recovered
Gold in Circuit Additions/(Drawdown)
Gold Poured
AISC
Measure
/Units
Tonnes
Tonnes
g/t
%
oz
oz
oz
$/oz
Syama
Sulphide Syama Oxide
Syama Total
Mako
Total
2,243,687
1,350,291
3,593,978
2,594,523
6,188,501
2,117,769
1,440,016
3,557,785
2,068,889
5,626,674
2.50
78.0
1.39
87.3
2.05
80.6
2.07
92.2
2.06
84.8
132,756
56,455
189,211
126,976
316,187
2,862
135,618
1,406
581
57,036
1,501
3,443
192,654
1,434
(359)
3,084
126,617
319,271
1,139
1,370
In Mali, the Syama sulphide circuit delivered gold production of 135.6koz at an AISC of $1,406/oz, a 10% increase in production and
4% decrease in AISC. Ore mined increased to 6% to 2.2Mt while the roaster recorded its highest ever throughput, processing 156.8kt.
The oxide operation transitioned to lower grade satellite pit mining towards the end of 2020 to maximise oxide ore production from
Syama. Multiple oxide pits are currently in production providing the basis for improved mining and ore blending.
In Senegal, the Mako mine completed the scheduled major cut-back, which will add an additional two years to the mine life.
The plant was also enhanced with the installation of a Mill Slicer allowing more efficient milling operations, this realised sustained
higher throughputs due to increased mill power efficiencies, in the last quarter. The mine produced 126.6koz of gold.
In both operations the COVID-19 pandemic was monitored closely and successfully managed to ensure operations were not
materially impacted. Personnel were screened with rapid antigen testing upon entry to site; ensuring positive cases did not enter
the work areas. Positive cases were denied site access (local employees) or quarantined in camp (expatriate employees).
2022 Outlook
Resolute forecasts gold production for 2022 to be 345.0koz at an AISC of $1,425/oz from the Syama and Mako operations.
Total sustaining capital included in AISC is forecast to be $63.0 million. This amount includes: $33.2 million in capitalised stripping
costs (Mako $21.0 million; Syama $12.2 million): $16.0 million in tailings storage capital and several minor sustaining capital items.
In addition, non-sustaining capital expenditure is forecast to be $17.9 million. This amount includes $5.0 million in milling circuit
improvements and Sulphide Shutdown capex, $3.9 million for ongoing spending on capital equipment to support the transition
to owner-operator, and minor capital items.
2022 Guidance
Syama Sulphide
Syama Oxide
Mako
Total
Production (oz)
AISC ($/oz)
145,000
75,000
125,000
345,000
1,345
1,430
1,325
1,425
15
Resolute Mining Limited 2021 Annual ReportOperations Review
Operations Review
Mali
AFRICA
Bamako
Syama
Gold Mine
Syama
Gold Mine
Syama is located in
the southwest of Mali,
approximately 30km from
the Côte d’Ivoire border
and 300km southeast of
the capital Bamako.
Syama Gold Mine is a large-scale operation,
comprising the established Syama Underground
Mine, the Tabakoroni Complex comprising an open
pit, and recently discovered underground Ore
Reserve, along with several satellite oxide pits.
Syama is owned by local subsidiary Société des
Mines de Syama S.A. (SOMISY) in which Resolute
has an 80% interest and the Government
of Mali holds the remaining 20%.
The Tabakoroni complex is owned by Société
des Mines de Finkolo S.A. (SOMIFI), part of the
Resolute Group.
16
Resolute Mining Limited 2021 Annual Report
Operations Review
SYAMA AT A GLANCE
MINING
3.6Mt of ore
PROCESSING
3.6Mt at 2.05g/t and
80.6% recovery
PRODUCTION
192,654oz
AISC
$1,434/oz
SALES
188,071oz
RESOURCES
8.7Moz at 2.6g/t
RESERVES
3.4Moz at 2.6g/t
GROWTH POTENTIAL
• Extension of the sub-level caving on strike
• Progress work on the extension of mining
projects at Tabakoroni
• Mining of open pit sulphide mineral resources
at previously mined oxide satellite pits
Resolute Mining Limited 2021 Annual Report
17
Operations Review
Syama Sulphide Operations
Gold production from the Syama sulphide circuit for 2021 was
135.6koz at an AISC of $1,406/oz. Gold production increased by
10% compared to 2020 reflecting strong roaster performance as
a result of the continuous system improvements for the circuit.
Syama Sulphide Processing Circuit Update
The 36-day shutdown of the Syama sulphide processing
circuit commenced in February 2022 and mill relines scheduled
for mid-2022 have been brought forward to align with this
shutdown and to minimise overall plant down-time.
A record 2.2Mt of ore was mined. Further improvement to the
sub-level cave production is expected to be reflected following
the development and calibration of custom-built Deswik
mathematical models for both validation and optimisation during
2022. This will continually optimise and improve the forecasting
of the cave for the remaining life of mine.
In addition, Resolute transitioned to owner operator mining in
the underground cave from June 2021. This will lower costs and
improve operational efficiencies going forward, with the aim to
optimise the ROM grade and increase the tonnages available to
the sulphide ore processing plant.
Milled tonnages increased to 2.1Mt, reflecting continuous
process system improvements including installing the On
Stream Analyser (OSA) and Flotation Cleaner Cells which
were ‘tied-in’ during a seven-day shutdown that took place in
late October 2021. With the final commissioning of the OSA
and Flotation Cleaning Cells in Q1 2022, it is expected gold
recoveries will increase to above 80%.
The Roaster operated well during 2021, with record roaster
throughput during the year, and the major focus was on the
control of sulphur feed levels to maintain constant heat loads.
This coupled with improved condition monitoring gave operators
renewed confidence in operating the unit, systematically
increasing its tonnages, and delaying the shutdown to 2022 to
coincide with these circuit improvements as well as mill relines.
The key activity planned in this shutdown is a refurbishment
of the Roaster refractory lining and modifications to the cyclones
which will allow increased throughputs and recoveries which are
expected to average 80%.
Syama Oxide Operations
The Oxide processing plant treated 1.4Mt of ore at a head grade
of 1.39g/t for 57.0koz of gold, with gold recoveries of 87.3%.
Oxide operations transitioned to produce from lower grade
satellite pits towards the end of 2020 and during 2021 oxide ore
production was from multiple pits which allowed for improved
mining and blend of ore. Oxide production for the year was
impacted by the wetter than expected September quarter which
disrupted mining processing and haulage to the mill.
The commencement of the Beta pit in October resulted
in a 15% increase in gold poured in the December quarter
compared to the previous quarter.
2021
Syama Sulphide Production and Cost Summary
2021
Syama Oxide Production and Cost Summary
Ore Mined
(t)
Ore Milled
(t)
Head Grade
(g/t)
Ore Mined
(t)
Ore Milled
(t)
Head Grade
(g/t)
2,243,687
2,117,769
2.50
1,350,291
1,440,016
1.39
Recovery
(%)
Production
(oz)
AISC
($/oz)
Recovery
(%)
Production
(oz)
AISC
($/oz)
78.0
135,618
1,406
87.3
57,036
1,501
18
Resolute Mining Limited 2021 Annual Report
Syama Power Station
In June 2021, the Syama Power Station construction
was completed with Aggreko plc (Aggreko) taking
beneficial ownership.
The new power station is expected to deliver long-term
electricity cost savings while reducing carbon emissions
by approximately 20%.
The power generating facilities comprises three modular
10MW Marine Oil (HFO) generators together with a 10MW
battery storage system. The battery storage system has also
been commissioned, replacing the need for conventional
fossil fuel spinning reserves.
Construction of the Resolute owned Bulk Fuel Storage
Facility has also been completed, with final commissioning
activities undertaken during the June quarter. The new facility
has capacity of 4,000,000 litres representing more than
30 days of consumption.
Tabakoroni Sulphide Project
At Tabakoroni, the measured and indicated Mineral Resource
Estimate was upgraded to 9.2Mt at 4.4g/t, at a 1.75g/t cut off for
a total of 1.3Moz, an increase of 40% from the previous estimate.
Resolute will continue to assess the most efficient alternative
for the development of the Tabakoroni Sulphide operations.
Development of the Tabakoroni Mine has been deferred by two
years to 2026 reflecting the oxide exploration success during
2021 which identified additional resources and extended the life
of the oxide operation from 2023 to 2026.
The Company is confident that a high-grade long-life operation
will follow the oxide open pit mining phases at Tabakoroni. The
PFS established a mining schedule accessing 2.4Mt at 4.9g/t
containing 386.6koz with recent drilling over 2021 significantly
increasing this Ore Reserve. The Tabakoroni deposit remains
open both along strike and at depth. Ongoing exploration
success is expected to continue to expand the Mineral
Resources and subsequently extend the mine life.
Resolute Mining Limited 2021 Annual Report
19
Operations Review
Operations Review
Dakar
Senegal
AFRICA
Mako
Gold Mine
Mako
Gold Mine
The Mako Gold Mine, located
in eastern Senegal, is a high
quality, open pit mine with
attractive scale and potential
life extension through several
near-mine exploration
opportunities.
Mako is owned and operated by Resolute’s
Senegalese subsidiary, Petowal Mining Company
S.A. Resolute has a 90% interest in Petowal and the
Government of Senegal holds the remaining 10%.
Mako is a conventional drill and blast, truck and
shovel operation with mining services undertaken
by an established contractor. The carbon in leach
processing plant has greater than 2.0 Mtpa of
installed capacity and comprises a crushing circuit,
an 8MW SAG Mill and gold extraction circuit.
Mako continues to deliver consistently strong
results and cash flows. Consistent ore grades
and metallurgical characteristics support reliable
production rates. Identified exploration targets have
the potential to increase mine life and exploration
programmes are in progress focussing on pit
extensions and satellite deposits within trucking
distance of the mill.
20
Resolute Mining Limited 2021 Annual Report
Operations Review
MAKO AT A GLANCE
MINING
2.6Mt
PROCESSING
2.1Mt at 2.07g/t
and 92.2% recovery
PRODUCTION
126,617oz
AISC
$1,139/oz
SALES
128,393oz
RESOURCES
826.0koz at 1.6g/t
RESERVES
661.0koz at 1.7g/t
GROWTH POTENTIAL
• Potential for further discovery and additional
mine life extensions.
Resolute Mining Limited 2021 Annual Report
21
Operations Review
Mako Operations Overview
In 2021, Mako poured 126.6koz of gold at an AISC of $1,139/oz.
Processed tonnages, grades and recoveries at Mako were all
ahead of expectations for the year. Plant throughput for the year
was 2.1Mtpa, from an original design capacity of 1.8Mtpa, while
maintaining excellent recoveries of 92.2%.
Mining has outstripped processing rates since operations began.
This has allowed the accumulation of large stockpiles of lower
grade ore (approximately 2.5Mt grading 1.4g/t) and delivered
higher grades to the processing plant.
The commissioning of the Mill Slicer in the latter half of the year
assisted in optimising mill throughput, resulting in the highest
throughput of the year in the December quarter.
Mako continues to perform reliably. Increased mining volumes
reflect the arrival of a new mining fleet during 2021, to accelerate
waste stripping.
2021
Mako Production and Cost Summary
Ore Mined
(t)
Ore Milled
(t)
Head Grade
(g/t)
2,594,523
2,068,889
2.07
Recovery
(%)
Production
(oz)
AISC
($/oz)
92.2
126,617
1,139
22
Resolute Mining Limited 2021 Annual Report
Operations Review
Sale Of Cote D’Ivoire Exploration Interests
On 21 May 2021, Turaco Gold Limited (Turaco) announced it had
entered into a Sale and Purchase Agreement with Resolute and
its wholly owned subsidiary Toro Gold Ltd (together ‘Resolute’)
to acquire the shares in two subsidiaries, resulting in the
acquisition of 100% of the Resolute’s exploration interests in
Cote d’Ivoire (‘Resolute Sale Agreement’) for A$1.0 million.
Corporate Activities
Sale of Bibiani Gold Mine
On 5 August 2021 Resolute announced the sale of the Bibiani
Gold Mine (Bibiani) to Asante Gold Corporation (Asante) for
total cash consideration of $90.0 million.
Cash consideration is payable as follows:
• $30.0 million deposit (received August 2021)
• $30.0 million on or before 6 months from completion
(received February 2022)
• $30.0 million on or before 12 months from completion.
Resolute is proud of its contribution to Ghana and is pleased to
have transferred ownership of Bibiani to a highly regarded team
with strong ties to Ghana.
The transaction is consistent with Resolute’s strategic focus on
its core operating assets and strengthening the balance sheet.
Resolute Mining Limited 2021 Annual Report
23
Operations Review
Exploration
Resolute continued
to focus on near mine
exploration activities
to extend and enhance
the ore bodies at
Syama and Mako.
24
Resolute Mining Limited 2021 Annual Report
Syama
Exploration to expand oxide resources and extend mine life
at Syama is a key priority for Resolute.
The Company holds 80km of contiguous tenements along the
highly perspective Syama shear and continues to explore for new
oxide positions. The Company is also exploring for high grade
sulphide zones to complement the Ore Reserves at the Syama
Underground Mine.
A multi-rig accelerated oxide exploration program at Syama
was undertaken in 2021. This involved a total of 575 RC holes
for 59,898 metres completed on the Syama and Finkolo
Exploitation Permits.
Syama North
A re-evaluation of the Syama Shear Zone, north of Syama,
identified several targets for follow up drilling. The targets are
adjacent to open pits mined by Resolute between 2017 and 2018.
RC drilling targeting oxide mineralisation extensions and
conceptual targets at Syama North began in 2020 with excellent
results reported in April 2020. Exploration has continued in
2021 with RC drill programs at Syama North designed to outline
mineable oxide resources.
Mineralisation typically occurs within shear zones and around
shallow west dipping lithological contacts, in the same manner
as the main Syama orebody and the Syama North satellite
deposits. Deeper sulphide mineralisation is open down dip and
remains a target for future exploration.
Results to date have been very encouraging with multiple
high-grade oxide intersections returned.
The results confirm coherent zones of gold mineralisation south
of the Beta oxide pit and north of the BA01 oxide pit. Drilling
density is sufficient to undertake resource modelling and pit
optimisation, which will be carried out before making a decision
to recommence open pit mining.
RC drilling at the A21 area similarly intersected zones of oxide
mineralisation adjacent to existing open pits. Drilling undertaken
in 2021 has identified oxide and sulphide mineralisation to
the east and west of the open pits related to gold lodes in the
hanging wall and footwall of the previously mined zones.
This newly identified oxide and sulphide mineralisation at
A21 was remodelled concurrently with the mineralisation at
Beta and BA-01. This was included in an updated Mineral
Resource Estimate (MRE).
This expanded MRE was optimised leading to mineable
oxide resources being identified at Beta South, A21 West
and north of BA-01.
Open pit mining commenced at Beta South in October 2021.
Finkolo Oxide Exploration
Successful exploration adjacent to the Tabakoroni open pits
during late 2020 and early 2021 expanded the gold mineralisation
footprint. This led to an updated Mineral Resources Estimation in
early 2021.
Positive mining studies carried out in Q2 2021 supported an
expanded open pit at Tabakoroni North, and Porphyry Splay.
Mining recommenced at Tabakoroni Porphyry Splay in April 2021.
Exploration for oxide deposits continued in 2021 with extensive
RC drill programs carried out to evaluate several identified
prospects on the Finkolo Exploitation Permit. Drill programs
were undertaken at the Zekere, Zozani, Finkolo Hill and Splay
North prospect areas with encouraging results returned
from all prospects.
25
Resolute Mining Limited 2021 Annual ReportOperations Review Tabakoroni
Underground Mineral Resource
Diamond drilling in 2021 was concentrated on both converting
the higher grade inferred resources to indicated category and on
expanding the footprint of the high-grade zone.
Extensional drilling has been extremely successful with multiple,
very high-grade intersections returned from drilling down dip
and outside the current resource model. These drill results
extend the high-grade zone down dip by a further 150m.
An updated MRE was undertaken in December 2021.
As expected, there was a significant increase in the high
confidence Measured and Indicated Resources as the main
focus of the drilling throughout 2021 concentrated on improving
the classification of the Mineral Resources.
The Measured and Indicated Resources have risen to
9.6Mt @ 4.4g/t for 1.36 million ounces at a cut off of
1.75g/t. This is a 42% increase in the previous MRE from
December 2020 of 6.9Mt @ 4.3g/t for 0.96 million ounces.
Mako
Resolute is seeking to extend the current remaining five-year
mine life of the Mako project by investing in exploration on the
Petowal Mine Lease and the neighbouring Research Permits.
The Company has acquired a large tenement position adjacent
to the Mako Mine and is investing in the exploration potential of
the region.
During 2021, Resolute undertook a comprehensive regional
exploration program over the 100% owned projects Koulountou
and Sangola and the joint ventures at Mamakanti and Tombo.
An extensive soil geochemistry program was completed at
Sangola, which identified four large gold in soil anomalies.
This will be followed up in 2022.
An auger drilling program was completed at Koulountou in
early 2021, which returned positive results. Gold assays from
auger holes show elevated results from a position on the
contact between the Koulountou granite and the mafic volcanic
sequence. Follow up drill testing of this anomalous zone is
underway with a program of aircore drilling, which commenced
in December 2021.
A planned drilling program to confirm and expand the identified
Tombo gold prospect has been delayed due to community
access issues. It is expected these issues will be resolved in 2022
and this high priority target will be progressed.
During 2021 an updated MRE was carried out on the Petowal
Gold Deposit. This work was completed to evaluate the impact
of the deep diamond drilling programs completed at Petowal in
2020. The updated resource was not materially different from the
2018 MRE when accounting for depletion.
Operations Review
26
Resolute Mining Limited 2021 Annual Report
Ore Reserves and
Mineral Resources
27
Resolute Mining Limited 2021 Annual ReportOre Reserves and Mineral Resources Ore Reserves and Mineral Resources
Increase in
mineral resources,
ore reserves
maintained
GLOBAL RESERVES
4.1Moz
GLOBAL RESOURCES
9.5Moz
28
Resolute Mining Limited 2021 Annual Report
Governance and Controls
Resolute reports its Mineral Resources and Ore Reserves
on an annual basis, with Mineral Resources inclusive of
Ore Reserves. Reporting is in accordance with the 2012 Edition
of the Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves and the ASX Listing Rules.
All Competent Persons named by Resolute are suitably qualified
and experienced as defined in the JORC Code 2012 Edition.
Competent Persons Statement
The information in this report that relates to data quality,
geological interpretation and Mineral Resource estimation for
the various projects unless specified in the list below is based on
information compiled by Bruce Mowat, a Competent Person who
is a Member of the Australian Institute of Geoscientists and a
full-time employee of Resolute Corporate Services Pty Ltd,
a wholly-owned subsidiary of Resolute Mining Limited.
Mr Mowat has sufficient experience that is relevant to the styles
of mineralisation and type of deposits under consideration and to
the activity being undertaken as a Competent Person as defined
in the 2012 Edition of the “Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves”
(JORC Code 2012). Mr Mowat consents to the inclusion in this
report of the material compiled by him in the form and context in
which it appears.
The information in this statement that relates to the Mineral
Resources and Ore Reserves is based on information and
supporting documents prepared by the Competent Person
identified. Each person specified in the list has sufficient
experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity, which has
been undertaken to qualify as a Competent Person as defined in
the JORC Code 2012.
Mr Atkinson and Mr Patani are full-time employees of
Resolute Corporate Services Pty Ltd, a wholly-owned
subsidiary of Resolute Mining Limited.
Mr Johnson is a full-time employee of MPR Geological
Consultants Pty Ltd.
Mr Osiejak is a full-time employee of Cube Consulting Pty Ltd.
Ms Havlin is an employee of Snowden Optiro Pty Ltd.
Each person consents to the inclusion in this report of the
material compiled by them in the form and context in which
it appears.
29
Resolute Mining Limited 2021 Annual ReportOre Reserves and Mineral Resources Competent Persons Statement (continued)
Activity
Competent Person
Membership Institution
Syama Resource
Syama Reserve
Northern Pits Resource
Syama Tailings Facility
Tabakoroni OP Resource
Susan Havlin
Gito Patani
Nic Johnson
Susan Havlin
Susan Havlin
Australasian Institute of Mining and Metallurgy
Australasian Institute of Mining and Metallurgy
Australian Institute of Geoscientists
Australasian Institute of Mining and Metallurgy
Australasian Institute of Mining and Metallurgy
Tabakoroni OP Reserves
Scott Atkinson
Australasian Institute of Mining and Metallurgy
Tabakoroni UG Resource
Tabakoroni UG Reserves
Tellem Resource
Tellem Reserves
Cashew NE Resource
Cashew NE Reserves
Paysans Resource
Paysans Reserves
Porphyry Zone Resource
Porphyry Zone Reserves
Mako Resources
Mako Reserves
Susan Havlin
Gito Patani
Nic Johnson
Scott Atkinson
Bruce Mowat
Scott Atkinson
Bruce Mowat
Scott Atkinson
Bruce Mowat
Scott Atkinson
Marcus Osiejak
Scott Atkinson
Australasian Institute of Mining and Metallurgy
Australasian Institute of Mining and Metallurgy
Australian Institute of Geoscientists
Australasian Institute of Mining and Metallurgy
Australian Institute of Geoscientists
Australasian Institute of Mining and Metallurgy
Australian Institute of Geoscientists
Australasian Institute of Mining and Metallurgy
Australian Institute of Geoscientists
Australasian Institute of Mining and Metallurgy
Australasian Institute of Mining and Metallurgy
Australasian Institute of Mining and Metallurgy
30
Resolute Mining Limited 2021 Annual Report
Ore Reserves and Mineral Resources Ore Reserves Statement
as at 31 December 2021
Ore Reserves
Proved
g/t
Tonnes
(000s)
oz
(000s)
Tonnes
(000s)
Probable
g/t
Mali
Syama Underground
Syama Stockpiles
Sub Total (Sulphides)
Satellite Deposits
Stockpiles (Satellite deposits)
0
760
760
793
768
Sub Total Satellite Deposits
1,560
Tabakoroni Underground
Tabakoroni Open Pit
Tabakoroni Satellite Deposits
Tabakoroni Stockpiles
Sub Total Tabakoroni
Mali Total
Senegal
Mako
Mako Stockpiles
Senegal Total
Total Ore Reserves
Notes:
0
596
962
888
2,450
4,770
2,040
3,050
5,090
9,860
0.0
1.8
1.8
1.8
1.5
1.7
0.0
2.0
1.6
1.5
1.7
1.7
1.9
1.1
1.4
1.5
0
44
44
46
38
83
0
39
49
43
25,700
1,810
27,500
1,430
1,400
2,830
5,030
209
0
0
131
258
5,240
35,500
122
103
224
482
7,100
0
7,100
42,600
2.6
1.3
2.5
1.9
1.0
1.5
4.7
1.8
0.0
0.0
4.6
2.8
1.9
0.0
1.9
2.6
Total Reserves
Group Share
oz
(000s)
Tonnes
(000s)
g/t
oz
(000s)
oz
(000s)
80%
2,160
25,700
77
2,570
2,240
28,200
89
43
132
2,220
2,170
4,390
766
5,030
12
0
0
804
962
888
778
7,680
3,150
40,300
437
0
9,140
3,050
437
12,200
2.6
1.5
2.5
1.9
1.2
1.5
4.7
2.0
1.6
1.5
3.7
2.6
1.9
1.1
1.7
2,160
1,730
121
2,280
135
80
215
766
51
49
43
908
3,400
558
103
661
97
1,820
108
64
172
90%
689
46
44
39
818
2,810
90%
502
93
595
3,580
52,500
2.4
4,060
3,410
1. Mineral Resources include Ore Reserves.
2. All tonnes and grade information have been rounded to reflect relative uncertainty of the estimate, small differences may be present in the totals.
3. Syama Underground mine planning is based on a cut-off grade of 2g/t.
4. Syama Satellite Reserves are reported above 1.0g/t cut-off.
5. Tabakoroni Underground Reserves are reported above a 2.5g/t cut-off.
6. Tabakoroni Satellite Reserves are reported above 1.1g/t cut-off.
7. Mako Reserves are reported above 0.6g/t cut-off.
Resolute Mining Limited 2021 Annual Report
31
Ore Reserves and Mineral Resources
Mineral Resources Statement
as at 31 December 2021
Mineral Resources
Measured
Indicated
Inferrred
Total Resources
Group Share
Tonnes g/t
(000s)
oz Tonnes g/t
(000s) (000s)
oz
(000s)
Tonnes g/t
(000s)
oz Tonnes
(000s)
(000s)
g/t
oz
(000s)
oz
(000s)
Mali
Syama Underground
14,400 3.6
1,640 25,400 3.0
2,460
10,600
Stockpiles (Sulphide)
760
1.8
44
1,830 1.4
79
0
2.6
0.0
883
50,400
3.1 4,980
0
2,590
1.5
123
Sub Total (Sulphides)
15,200 3.5
1,690 27,300 2.9
2,540
10,600 2.6
883
53,000
3.0 5,110
Satellite Deposits
4,330 2.7
375 11,000 2.1
Stockpiles (Satellite Deposits)
768
1.5
38
1,400 1.0
Sub Total Satellite Deposits
5,100 2.5
412 12,400 2.0
758
43
800
4,860
45
2.8
1.1
4,910 2.8
Old Tailings
0 0.0
0
0 0.0
0
17,000
0.7
Tabakoroni Open Pit
524 3.3
55
2,130 4.6
Tabakoroni Underground
6 3.5
1
5,180 4.8
Tabakoroni Satellite Deposits
1,560 1.7
Tabakoroni Stockpiles
888
1.5
86
43
850
1.7
0 0.0
318
792
47
0
21
1,640
414
5.6
3.5
1.9
0
0.0
435
20,200
2
2,220
2.4
1.2
1,570
82
437
365
4
182
25
0
22,400
2.3 1,650
17,000
0.7
365
2,670
6,830
2,830
888
4.4
4.4
1.7
1.5
377
976
157
43
Sub Total Tabakoroni
2,980 1.9
185
8,160 4.4
1,160
2,080 3.2
211
13,200
3.7 1,550
Mali Total
23,300 3.1
2,290 47,800 2.9
4,490
34,600
1.7 1,900 106,000
2.6 8,670
Senegal
Mako
Mako Stockpile
Senegal Total
2,460
3,050
1.7
1.1
135
103
9,910 1.8
560
0 0.0
0
986
0
0.9
0.0
5,510 1.3
238
9,910 1.8
560
986 0.9
28
0
28
13,400
3,050
1.7
1.1
723
103
16,400
1.6
826
80%
3,990
99
4,090
1,250
66
1,320
292
90%
339
878
142
39
1,400
7,090
90%
650
93
743
Total Mineral Resources
28,800 2.7 2,520 57,800 2.7 5,050 35,600
1.7
1,920 122,000
2.4 9,500
7,840
Notes:
1. Mineral Resources include Ore Reserves.
2. All tonnes and grade information has been rounded to reflect relative uncertainty of the estimate, small differences may be present in the totals.
3. Bibiani Reserves are reported above 2.75g/t cut-off.
4. Syama Underground mine planning is based on a cut-off grade of 2g/t.
5. Syama Satellite Reserves are reported above 1.0g/t cut-off.
6. Tabakoroni Underground Reserves are reported above a 2.5g/t cut-off.
7. Tabakoroni Satellite Reserves are reported above 1.1g/t cut-off.
8. Mako Reserves are reported above 0.6g/t cut-off.
32
Resolute Mining Limited 2021 Annual ReportOre Reserves and Mineral Resources Financial
Review
33
Resolute Mining Limited 2021 Annual ReportFinancial Review Financial Review
34
34
34
Resolute Mining Limited 2021 Annual Report
Resolute Mining Limited 2021 Annual Report
Resolute Mining Limited 2021 Annual ReportFinancial Review Financial Performance
Revenue for 2021 was $549.2 million from gold sales of 316.5koz at an average realised price of $1,733/oz compared to the average
spot price of $1,800/oz. EBITDA for the Group was $129.9 million in 2021. The reported net loss after tax was $367.5 million, after
non-cash impairment, fair value adjustments and historical tax charges. The table below sets out a reconciliation of Group earnings
for the year ended 31 December 2021.
Profit and Loss Analysis
$’000
Revenue
Cost of sales excluding depreciation and amortisation
Royalties and other operating expenses
Administration and other corporate expenses
Exploration and business development expenditure
EBITDA
Depreciation and amortisation
Net interest and finance costs
Unrealised treasury transactions
Inventories write off and net realisable value movements
Other
Impairment expense
Gain on disposal
Net (loss)/profit before tax
Indirect tax expense
Current income tax expense
Deferred income tax expense
Reported net (loss)/profit after tax
2021
2020
549,242
602,985
(324,984)
(301,635)
(59,066)
(71,339)
(16,809)
(18,484)
(18,634)
(10,910)
129,899
200,467
(120,993)
(175,331)
( 11,741 )
(22,522)
(27,697)
(44,258)
(3,482)
(227,464)
15,968
175
(884)
-
2,707
41,475
(303,029)
59,348
(24,760)
(24,308)
(37,613)
(12,833)
(2,069)
(17, 212)
(367,471)
4,995
35
Resolute Mining Limited 2021 Annual ReportFinancial Review
Financial Performance (continued)
Gross debt was reduced by 6% during 2021 to $317.4 million after taking into account cash and bullion balances of $88.6 million,
net debt reduced to $228.8 million. Figure 1 below provides a breakdown of Resolute’s key cashflow movements for the year ended
31 December 2021.
147.8
(15.7)
(38.1)
106.5 17.5
89.1
(56.9)
(12.8)
30.8
21.9 88.6
(20.5)
(32.6)
67.6
(13.6)
(9.9)
Cashflow
$’m
250
200
150
100
50
0
Cash and
Bullion
1 Jan 21
Bullion
1 Jan 21
Cash
1 Jan 21
Operating
Cash
Flows
Royalties
VAT
and Tax
Capex Exploration Working
Capital
and
Other
Asset
Sale
Proceeds
Net
Debt
Move-
ments
Interest
Paid
Government
Dividend
and
Withholding
Tax
Bullion
31 Dec 21
Cash
31 Dec
21
Cash and
Bullion
31 Dec 21
Financial Position
At 31 December 2021, the Company’s cash and bullion totalled $88.6 million and listed investments were valued at $47.2 million while
gross borrowings were $317.4 million. The Company’s borrowing facilities at year-end comprised of $150.0 million Revolving Credit
facility (RCF), $125.0 million Amortising Term Loan (Term Loan) and unsecured bank overdraft facilities held in Mali and Senegal.
Following year-end, Resolute agreed on commercial terms with its financiers to extend the RCF for an additional 12 months to
March 2024 providing greater financial flexibility.
As part of extending the RCF, a review of the structure and tenure of the Group’s debt facilities has also been undertaken.
Under the refinancing agreed with syndicate lenders, the RCF maturity will be extended to the end of March 2024 (previously due
in March 2023), with the following amended repayment schedule:
• $30.0 million in August 2022 upon receipt of the third tranche of the Bibiani sale consideration
• $20.0 million in January 2023
• $20.0 million in March 2023 in line with the original RCF maturity date
• the final $80.0 million in March 2024
There are no changes to the Term Loan Facility, which, at the date of this report, has a balance of $100.0 million. Amortisation of this
Facility remains unchanged at $25.0 million each March and September.
36
Resolute Mining Limited 2021 Annual ReportFinancial Review Risk
Management
37
Resolute Mining Limited 2021 Annual ReportRisk Management Risk Management
Resolute maintains a proactive and considered approach to risk
and opportunity management across the Group.
Risk appetite statements have been established by the Resolute
Board and guide management and mitigation efforts across the
business. Resolute’s risk management approach aligns with ISO
31000:2018 and is guided by the ASX Corporate Governance
Council Principles and Recommendations 4th edition.
The Board has ultimate accountability for ensuring material risks
faced by the Company are identified and effectively managed in
accordance with predetermine risk appetite statements. Board
intervention occurs when there is a significant change in the
Company risk profile across any of its material exposures.
The Audit and Risk Committee has the mandate from the
Board to provide risk management oversight across all material
exposures. The Audit and Risk Committee engages proactively
with the Executive Team to optimise Resolute’s systems of risk
identification, mitigation, management, assurance and reporting.
Executive management provide regular updates to the Audit and
Risk Committee relative to new and emerging risks and their
mitigations in line with leading practice.
Resolute will implement CGR Foundation software in 2022,
which will enable improved risk identification, mitigation, control
evaluation and reporting. This software will complement the
existing INX InControl system that has been implemented across
the operations to manage risk and opportunity at each asset.
Systemising Resolute’s risk management approach across the
Group will ensure a standardised risk approach is consistently
applied and enable improved reporting.
KPMG is engaged to support the ongoing optimisation and
assurance of Resolute’s Risk Management Framework and to
support Audit and Risk Committee and Board reporting.
Risk Management Framework
Board + Audit and Risk Committee
Define Risk Appetite
Executive + Leadership Teams
Custodians of the Risk Management Framework
1
Identify Risk
2
3
4
Assess Risk
Mitigate and Manage Risk
Monitor and Report Risk
Systems Support
Integrated reporting to
enable more effective
governance and
decision making
Integrated risk profile
Coordinated
touch points with
the business
Efficiencies through
use of technology
Standardisation of risk
and opportunity
management
Operations
Corporate
Critical
Fatality Risks
Environmental
Investment Level
Finance
Cyber
Sovereign
/ Political
Business Continuity
Unplanned Events
Sustainability
/ ESG
Resources
and Reserves
38
Resolute Mining Limited 2021 Annual ReportRisk Management
Risk and Mitigation Summary
The following table provides a high-level account of Group material exposures.
RISKRISKRISK
Serious injury or fatality
(single or multiple)
sustained at work or whilst
commuting to/from work.
RISK
Security event
adversely impacting
employee health, safety
and wellbeing and or
business continuity.
RISK
Unable to effectively
respond/adjust to physical
and legislative operating
environment changes driven
by Climate Change, which
threatens business
continuity/viability.
RISK
Uncertain political/fiscal/
tax environments and
government instability.
• Permanent disability (physical
• Fatality
S
T
C
A
P
M
or mental)
L
A
I
T
N
E
T
O
P
I
• Injury and illness
• Industry standard safety
management systems
• Embedded safety conscious culture
• Staff safety training programs
• Legal and legislative implications
• Financial loss
• Reputational damage
• Contractor pre qualification,
induction and training
• Regular review processes
and procedures
• Critical Hazard Management
• High risk training systems and
competency verification
• Kidnap/ransom
• Compromised asset security
• Theft (e.g. fuel, inventory etc.)
• Financial loss
• Reputational damage
• Increased attrition
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
• Security Management Framework
S
• Specialist internal/external security
E
C
I
T
C
A
R
P
services providers
• Crisis and Emergency
Management System
G
N
I
T
A
G
I
T
I
M
• Multi-source real-time intelligence
• Regular review and audits
• Strong stakeholder relations and
engagement
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
• Material increase in operating costs
• Licensed to operate threatened/
suspended
• Inability to acquire debt funding/
financing
• Reputational damage
• Loss of investor confidence
• Environmental licence conditions
• Robust environmental monitoring
• Ongoing operational
emissions modelling
• Group Sustainability Strategy
and net zero commitment
• Regular community interactions
and engagement
• Continual air quality monitoring
• External assurance (tailings,
environmental etc)
• Loss of, or significant reduction to,
• Productivity and cost of production
licence to operate
affected
• Increased regulation and operating
• Supply chain disruptions
scrutiny
• Reputational damage and
deterioration of social licence
to operate
• Ongoing stakeholder/government
• Active proponents of non-political
engagement
government agendas
• Dedicated Country Manager
• Mining Agreements in each
and other in-country expertise
operating jurisdiction
• Strong local development
• Business continuity planning
track record and local
stakeholder support
39
Resolute Mining Limited 2021 Annual ReportRisk Management
Risk and Mitigation Summary
The following table provides a high-level account of Group material exposures.
RISK
Health event impacting
employee health, safety and
wellbeing and/or business
operations/continuity.
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
• Illness
• Permanent disability
• Fatality
• Operational site quarantined
and/or large-scale disruption
of operations
• Reputational damage impacting ability
to maintain and attract staff/contractors
to site
• Deterioration of government/stakeholder
relations
• Infectious disease management
protocols
• Medical review and external audits
• Occupational health assessments/
• Implementation of WHO guidelines
surveillance
and other industry standards
• Injury and medical emergency
• Primary, occupational and
evacuation protocols
emergency medical capability
established at each asset
• Malaria mitigation program
RISK
Bribery or corruption.
• Compliance breach
S
T
• Financial impact
C
A
• Reputational damage
P
M
I
L
A
I
T
N
E
T
O
P
• Ongoing Anti-Bribery and
• Independently operated whistle-
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
Corruption and Code of Conduct
training and declarations are in
place for all staff
• Inclusion of Anti-Bribery and
Corruption requirements for
sub-contractors included within
contracts
blower hotline
• Financial system controls in place
• Fraud risk assessments
• Regular review and audits
• Financial impact
S
T
C
A
P
M
• Negative operational impacts
• Reputational damage and unmet
shareholder expectations
I
L
A
I
T
N
E
T
O
P
• Significant operational delays
• Inability to service debt
• Share price decline
• Hostile takeover
• Established Life of Mine,
budgeting and forecasting
processes
• Maintenance schedules and
processes
• Mine performance management
and reporting processes
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
• Contractor management procedures
• Staff recruitment and training
programs
• Use of third party best in class technical
advisors and consultants
• Grade control and metallurgical
accounting systems
• Suboptimal project outcomes
S
T
• Future operational impacts
C
A
P
• Safety of staff
M
I
L
A
I
T
N
E
T
O
P
• Financial impact
• Reputational damage
• Failure to meet performance indicators
• Established project
methodology
• Project monitoring and reporting
processes
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
• Project governance structures
• Procurement and contract
in place
• Use of third-party technical
advisors and consultants
management procedures and
practices
• Regular review and audits
RISK
Inability to achieve and
maintain required/planned
operational performance to
meet ROI and shareholder
expectations.
RISK
Project delivery failure.
40
Resolute Mining Limited 2021 Annual ReportRisk Management
Risk and Mitigation Summary
The following table provides a high-level account of Group material exposures.
RISK
Critical operational or
informational technology
failure.
RISK
Human Rights exposures
associated with Resolute’s
business activities threatens
business continuity/viability.
RISK
Inability to maintain/grow
Resources and Reserves
resulting in material decline
in market confidence and
Company valuation.
RISK
Catastrophic failure of
Tailings Storage Facility.
• Financial loss
S
T
C
A
P
M
• Loss of critical information
I
L
A
I
T
N
E
T
O
P
• Legislative and or regulatory breaches
• Negative impacts on operations
and projects
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
• Network security design and
firewalls
• Network penetration testing
• Information technology and operational
• Network backups and disaster
technology convergence strategy
recovery processes
• Ongoing IT training
• IT infrastructure upgrade programs
• Regular review and audits
• Reputational damage
• Loss of investor confidence
• Decreased ability to acquire debt
funding/financing
• Deterioration in key stakeholder
relationships
• Supply chain disruptions
• Suspension/revocation of licence
to operate
• Human Rights provisions in all
contract service agreements
with key suppliers
• Labour law compliance for all
employment practices
• Commitment to Voluntary
Principles of Security and
Human Rights
• Training and education of workforce
• Stakeholder engagement
• Human Rights Policy
• Modern Slavery Voluntary Statement
• Financial impact
S
T
C
A
P
M
• Reputational damage
• Share price decline
I
L
A
I
T
N
E
T
O
P
• Inability to service debt
• Hostile takeover
• Active well-funded exploration
• Effective utilisation of external
campaigns
• Highly qualified professional
personnel
• Established relationships with
multiple drilling contractors for
contract labour/technical capability
consultants to broaden capability
• Well managed and controlled mining
tenement administration
• Stakeholder engagement
• Identification and acquisition of
new exploration projects
• Suspension/revocation of
operating licence
• Social activism/outrage
• Financial penalties
• Significant production impacts
• Long-term environmental damage
• Health decline/fatality
• Asset Shutdown
• Reputational damage
• Loss of investor/stakeholder confidence
• Tailings governance framework
• Daily, weekly, monthly TSF
monitoring
• Environmental monitoring
e.g. ground/surface water quality
• Engineer on Record e.g.
Golder, Advision, Knight Piesold
• Annual external audits
• Piezometers - ground stability
• Deposition strategies
• Operation and design parameters
• Specialist TSF contractors/expertise
(non-engineering)
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
41
Resolute Mining Limited 2021 Annual ReportRisk Management
Risk and Mitigation Summary
The following table provides a high-level account of Group material exposures.
RISK
Failure to deliver
technology to support
operational and strategic
needs and/or exposes
Resolute to cyber attack.
L
A
I
T
N
E
T
O
P
S
T
C
A
P
M
I
• Financial impact (failure to
realise efficiencies and become
uneconomical)
• Shift in skillset required
• Data privacy and security issue
• Operational impacts
• Failure to report (financial,
operational etc)
• IFS deployed across RCS, Syama
and Bamako
• Cyber Security Policy and
standards implemented
• End user computing remediation
• Significant cyber security remediation
activities completed
• OT Principle to lead the upgrade program
• OT/IT segregations
• Third party access controls into OT and
IT space
• User based log-in and audit
• Deployed user assessment training
(cyber training)
G
N
I
T
A
G
I
T
I
M
S
E
C
I
T
C
A
R
P
completed and migration to
Office 365
• Network connections upgraded
and data centre containers
deployed
• IT computer and storage
infrastructure upgraded
• Wireless network upgrade in
progress and lightning protection
upgraded
• Operational Technology
(OT) computer and storage
infrastructure upgraded
• Surface and underground OT
networks connected
• Intranet, Controlled Document
Management System and Data
Room implemented
(1) ‘Material Exposure’ is defined in the ASX Recommendations as “a real possibility that the risk in question could materially impact
the Company’s ability to create or preserve value for Shareholders over the short, medium or longer term.
42
Resolute Mining Limited 2021 Annual ReportRisk Management
Corporate
Governance
43
Resolute Mining Limited 2021 Annual ReportCorporate Governance Corporate Governance
Corporate
Governance
Resolute is committed
to the highest standards
of corporate governance
and ethical conduct.
44
Resolute Mining Limited 2021 Annual Report
Code of Conduct
Resolute willingly operates under a strict Code of Conduct
(Code) that underpins, guides and enhances the conduct
and behaviour of Directors, employees, contractors and
consultants in performing their everyday roles.
The Code provides that the following core principles guide
the behaviour of Directors, employees, contractors and
consultants:
• Act with integrity and professionalism in the performance of
their duties and in the proper use of company information,
funds, equipment and facilities
• Exercise fairness, honesty, respect and consideration in
all their dealings while carrying out their duties
• Avoid real, apparent or perceived conflicts of interest.
The Code provides specific detail and is available to view online
at www.rml.com.au/corporate-governance.
Conflicts of Interest
Resolute recognises that proper disclosure and management
of conflicts of interests is integral to its reputation and business
objectives.
It is Resolute’s policy that all Directors and employees must,
wherever possible, avoid any conflict of interest, must disclose
any potential for a conflict of interest, and where a conflict
cannot be avoided, must manage that conflict of interest.
The duty to avoid, disclose and manage conflicts of interest
does not prohibit all conflicts of interest – rather it requires
that conflicts are adequately disclosed and managed when
they arise.
The Company’s Conflicts of Interest Policy provides specific
detail and is available to view online at www.rml.com.au/
corporate-governance.
Securities Trading
It is Resolute’s policy that Directors and employees must ensure
all trading of Company securities they undertake complies
with the Australian Corporations Act and the retained Market
Abuse Regulation as it forms part of English law. The Company’s
Securities Trading Policy provides specific detail and is available
to view online at www.rml.com.au/corporate-governance.
Conducting Business Overseas
It is Resolute’s policy that its business affairs and operations should
at all times be conducted legally, ethically, and in accordance
with community standards of integrity and propriety. The Code
requires business dealings must be conducted in accordance with
Australian and other applicable jurisdictions’ anti-bribery laws. The
Company’s Anti-Bribery and Corruption Policy and Whistleblower
Policy provide specific detail and are available to view online at
www.rml.com.au/corporate-governance.
Additional Policies
In addition to those mentioned above, Resolute has implemented the
following charters and additional policies all of which are available
to view online at www.rml.com.au/corporate-governance:
• Board Charter
• Audit and Risk Committee Charter
• Remuneration Committee Charter
• Nomination Committee Charter
• Sustainability Committee Charter
• Continuous Disclosure Policy
• Communication Strategy
• Diversity and Inclusion Policy
• Performance Evaluation Process
• Privacy Policy
• Procedure for Appointment of New Directors.
Resolute Mining - Code of Conduct
Outlines the Company’s expectations of all Directors, Officers and Employees
and is supported by the following:
Key policies, procedures and statements
Guiding our approach to responsible mining
Health, Safety and
Security Policy
Environment
Policy
Social
Performance Policy
Human Rights
Policy
Anti-Bribery and
Corruption Policy
Diversity and
Inclusion Policy
Complaints and
Grievance Procedure
Sexual
Harassment
Policy
Responsible
Tailings
Management Policy
Water
Stewardship
Policy
Working
Responsibly
Policy
Scope 3
Emissions
Methodology
Climate
Change Statement
Modern
Slavery Statement
Key shareholder protections
Securities
Trading
Policy
Enterprise Risk
Management
Framework
Continuous
Disclosure
Policy
Conflicts of
Interest
Policy
Privacy
Policy
Underpinned by
Whistleblower Policy
Formalised confidential reporting and recourse mechanism for inappropriate conduct
45
Resolute Mining Limited 2021 Annual ReportCorporate Governance The Board
The Board of Directors is responsible for the corporate governance of the Company. The Board guides and monitors the Company’s
business and affairs on behalf of Resolute shareholders by whom they are elected and to whom they are accountable.
The table below sets out the appointment date and qualifications of each Director.
DIRECTOR
Martin Botha
BScEng
DIRECTOR
Mark Potts
BSc (Hons),
GAICD
DIRECTOR
Adrian
Reynolds
MSc,
GradDipMinEng
F
O
E
L
O
R
T
S
R
I
F
F
O
E
L
O
R
T
S
R
I
F
F
O
E
L
O
R
T
S
R
I
F
R
O
T
C
E
R
D
I
I
D
E
T
N
O
P
P
A
R
O
T
C
E
R
D
I
I
D
E
T
N
O
P
P
A
R
O
T
C
E
R
D
I
I
D
E
T
N
O
P
P
A
Non-Executive Director
and Chairman
(appointed Chairman from 29 June 2017)
February 2014
DIRECTOR
Stuart Gale
BEcon, FCA
Non-Executive Director
DIRECTOR
June 2017
Sabina Shugg
BSc (Mining
Engineering),
MBA, GAICD
Non-Executive Director
DIRECTOR
May 2021
Simon Jackson
B.Com FCA
F
O
E
L
O
R
T
S
R
I
F
F
O
E
L
O
R
T
S
R
I
F
F
O
E
L
O
R
T
S
R
I
F
R Managing Director and
O
T
Chief Executive Officer
C
E
R
D
(appointed Interim Chief Executive
Officer from 21 October 2020)
I
I
D
E
T
N
O
P
P
A
R
O
T
C
E
R
D
I
I
D
E
T
N
O
P
P
A
R
O
T
C
E
R
D
I
I
D
E
T
N
O
P
P
A
October 2020
Non-Executive Director
September 2018
Non-Executive Director
October 2021
Resolute Mining Limited Board of Directors
Governance and strategic management of Resolute on behalf of shareholders
e
e
m it t
m
Oversees Board
membership,
performance and
development
mination C o
o
N
Sustain
a
bilit
y
C
o
m
m
i
t
t
e
e
Oversees
Sustainability
strategy and
performance
R
e
m
u
n
e
r
a
ti
o
n C
o
m
mittee
A u
Oversees Group
remuneration
practices
d it & Risk Com
e
e
mitt
Oversees
financial reporting,
risk and opportunity
Managing Director and CEO
Responsible for the execution of Board approved strategies
and the leadership of the organisation
46
Resolute Mining Limited 2021 Annual ReportCorporate Governance
The table below sets out the detail of the independence
of each Director as at 31 December 2021.
Remuneration Committee
As at 31 December 2021, the Remuneration Committee consisted
of the following Non-Executive Directors:
Director
Martin Botha
Stuart Gale
Mark Potts
Sabina Shugg
Adrian Reynolds
Simon Jackson
Non-
Executive
Yes
No
Yes
Yes
Yes
Yes
Independent
Gender
• Mr M. Potts (Chair)
Yes
No
Yes
Yes
Yes
Yes
Male
Male
Male
• Mr M. Botha
• Mr S. Jackson
• Mr A. Reynolds
Female
• Ms S. Shugg
Male
Male
As at 31 December 2021 and as at the date of release of
this Annual Report, all of the above listed members of the
Remuneration Committee were independent.
The Company’s Board Charter outlines the functions reserved
to the Board and those delegated to management. The Board
Charter delineates the responsibilities and functions of the
Board as being distinct from those of management. Resolute’s
Board Charter is available to view online at www.rml.com.au/
corporate-governance.
The Remuneration Committee is responsible for recommending,
monitoring and reviewing compensation arrangements for
Resolute’s Directors, CEO, Executive Committee and employees,
and making subsequent recommendations to the Board.
The Remuneration Committee Charter is available to view online
at www.rml.com.au/corporate-governance.
Committees
The Board has established the following sub-committees to
assist with internal control and business risk management:
Nomination Committee
As at 31 December 2021, the Nomination Committee consisted of
the following Non-Executive Directors:
• Mr M. Botha (Chair)
• Mr S. Jackson
• Mr M. Potts
• Ms S. Shugg
• Mr A. Reynolds
As at 31 December 2021 and as at the date of release of
this Annual Report, all of the above listed members of the
Nomination Committee were independent.
The Nomination Committee ensures Directors are appropriately
qualified and experienced to discharge their responsibilities and
implements procedures to assess the performance of the CEO
and the Executive Committee.
The Nomination Committee Charter is available to view online at
www.rml.com.au/corporate-governance.
• Audit and Risk Committee
• Remuneration Committee
• Nomination Committee
• Sustainability Committee
Audit and Risk Committee
As at 31 December 2021, the Audit and Risk Committee
consisted of the following Non-Executive Directors:
• Mr. S Jackson (Chair)
• Mr M. Botha
• Mr M. Potts
• Ms S. Shugg
• Mr A. Reynolds
As at 31 December 2021 and as at the date of release of this
Annual Report, all of the above listed members of the Audit and
Risk Committee were independent.
The Audit and Risk Committee provides the Board with
additional assurance regarding the reliability of the financial
information for inclusion in the financial reports, and is also
responsible for:
•
•
•
•
Ensuring compliance with statutory responsibilities relating to
accounting policy and disclosure
Liaising with, discussing and resolving relevant issues with
the auditors
Assessing the adequacy of accounting, financial and
operating controls
The review of half-year and annual financial statements before
submission to the Board
•
The assessment, management and monitoring of business risk.
The Audit and Risk Committee Charter is available to view at
www.rml.com.au/corporate-governance.
47
Resolute Mining Limited 2021 Annual ReportCorporate Governance
Corporate Governance
Sustainability Committee
As at 31 December 2021, the Sustainability Committee consisted
of the following members:
• Mr S. Gale
• Ms S. Shugg
• Mr A. Reynolds
• Mr M. Potts
• Mr J. Morrissey
• Mr T. Holohan
As at 31 December 2021 and as at the date of release of this
Annual Report, Ms S. Shugg, Mr A. Reynolds and Mr M. Potts
were the Non- Executive Directors on the Sustainability
Committee and were independent.
The Sustainability Committee’s key purpose is to review, discuss
and guide all matters pertaining to Resolute’s sustainability
performance and associated risks and opportunities.
These matters predominantly relate to the performance of the
people, health, safety, security, environment and community
divisions within Resolute and will include regular assessments
of the Company’s alignment with leading practice including,
but not limited to, the Responsible Gold Mining Principles and
the Global Reporting Initiative.
The Sustainability Committee Charter is available to view online
at www.rml.com.au/corporate-governance.
Corporate Governance Statement
The Board has adopted the “Corporate Governance Principles
and Recommendations 4th edition” established by the ASX
Corporate Governance Council and published by the Australian
Securities Exchange (ASX) in February 2019.
Resolute’s Corporate Governance Statement is available to view
online at www.rml.com.au/corporate-governance
4848
Resolute Mining Limited 2021 Annual Report
Resolute Mining Limited 2021 Annual Report
Financial
Report
49
Resolute Mining Limited 2021 Annual ReportFinancial Report Financial Report
Directors’ Report
Your Directors present their
report on the consolidated entity
(referred to hereafter as the
Group or Resolute) consisting of
Resolute Mining Limited and the
entities it controlled for the year
ended 31 December 2021.
Corporate Information
Resolute Mining Limited (Resolute or the Company)
is a company limited by shares that is incorporated
and domiciled in Australia.
Directors
The Directors of Resolute in office at the end of the
2021 financial year and information on the Directors
(including qualifications and experience and
directorships of listed companies held by
the Directors at any time in the last three years)
are set out on pages 7-8 of this report.
The names and details of the Directors of Resolute
in office during the 2021 financial year but not as at
31 December 2021 are as follows:
50
Resolute Mining Limited 2021 Annual Report
Peter Sullivan
BEng, MBA
(Non-Executive Director until 27 May 2021)
Mr Peter Sullivan was appointed Managing Director and
Chief Executive Officer of the Company in 2001 and retired
as Chief Executive Officer on 30 June 2015 at which point, he
became a Non-Executive Director of the Company, resigning
on 27 May 2021. Mr Sullivan was a member of the Remuneration
Committee (Chair until 19 February 2020), the Audit and Risk
Committee and the Nomination Committee.
Mr Sullivan is an engineer with extensive experience as a non-
executive director and in senior executive roles, including in
chief executive officer and operational positions. Mr Sullivan
brings wide-ranging and global experience working in listed
and unlisted resource companies. He has valuable insight
and experience in engineering and construction, investment
banking and capital markets and managing mining operations in
Australia and internationally.
Mr Sullivan has over 30 years’ experience working with ASX-
listed companies and has a broad strategic perspective and
understanding of the long-term cyclical nature of the resources
industry. Mr Sullivan has been closely involved with the strategic
development of resource projects and companies with input
across technical, financial, regulatory and governance matters.
Mr Sullivan has worked across multiple jurisdictions including
Africa, North America, Europe and Asia. He holds a Bachelor of
Engineering degree from the University of Western Australia and
an MBA from the Australian Graduate School of Management.
During his tenure Mr Sullivan was a Non-Executive Director
of GME Resources Limited (appointed 1996), Zeta Resources
Limited (appointed 2013), Panoramic Resources Limited
(appointed 2015), Horizon Gold Limited (appointed 2020) and
Copper Mountain Mining Corporation (appointed 2020).
Yasmin Broughton
BACom, Post Graduate Law, FAICD
(Non-Executive Director until 28 October 2021)
Ms Yasmin Broughton was appointed to the Board as a Non-
Executive Director in June 2017 and stepped down from the
role on 28 October 2021. Ms Broughton was Chair of the Audit
and Risk Committee, and was a member of the Remuneration
Committee and the Nomination Committee. Ms Broughton is
a barrister and solicitor with extensive experience as a non-
executive director and corporate lawyer working in a diverse
range of industries including mining, infrastructure, energy,
financial services, cyber security and agriculture.
Ms Broughton was a senior associate at the international law
firm, Ashurst. As a corporate lawyer, Ms Broughton’s speciality
is M&A, corporate finance, and corporate governance. Ms
Broughton has over 20 years’ experience working with ASX-
listed companies and has a deep understanding of strategy,
change management, governance and risk, compliance
and regulation. In her executive career, Ms Broughton was
general counsel and company secretary of several ASX-listed
companies including Alinta Limited, a former ASX 50 energy
and infrastructure company. Ms Broughton has worked across
multiple jurisdictions including the UK, Europe, Asia, and Africa.
Ms Broughton is a member of the Audit and Risk Committees
of Western Areas, Synergy and the Insurance Commission of
WA and a member of the Human Resources and Sustainability
Committee at Synergy. Ms Broughton has a broad strategic
perspective and understanding of the long-term cyclical
nature of the resources industry with proven health, safety and
environment performance. Ms Broughton is a Fellow of the
Australian Institute of Company Directors.
During her tenure Ms Broughton was a Non-Executive Director
of Western Areas Limited (appointed October 2020).
Significant Changes in the State of Affairs
There have been no significant changes in the state of affairs
of the Company other than those stated throughout this report.
Significant Events after Reporting Date
On 31 January 2022, the Group completed the sale of its shares
in Orca Gold Inc (Orca) to Perseus Mining Limited for total
consideration of $13.7 million.
On 17 February 2022, the Group announced that the Tabakoroni
Measured and Indicated Mineral Resource estimate increased to
9.2 million tonnes at 4.4g/t for 1.3 million ounces of gold a 40%
increase over previous estimate.
On 22 February 2022, the Group received $30.0 million for the
sale of the Bibiani Gold Mine, the final $30.0 million is receivable
in August 2022.
On 28 March 2022, the Group successfully completed the
extension of the Revolving Credit Facility.
Environmental Regulation Performance
The consolidated entity holds licences and abides by Acts and
Regulations issued by the relevant mining and environmental
protection authorities of the various countries in which the
Group operates. These licences, Acts and Regulations specify
limits and regulate the management of discharges to the air,
surface waters and groundwater associated with the mining
operations as well as the storage and use of hazardous materials.
There have been no significant known breaches of the
consolidated entity’s licence conditions or of the relevant
Acts and Regulations.
Responsibility Statement
In the opinion of the Directors and to the best of their
knowledge, the Directors’ Report includes a fair review of the
development and performance of the business and the financial
position of the consolidated entity, together with a description
of the principal risks and uncertainties that the consolidated
entity faces.
Company Secretary
The Company Secretary of Resolute in office at the end of the
2021 financial year and information (including qualifications
and experience) is set out on page 10 of this report. The names
and details of the Company Secretary in office during the 2021
financial year but not as at 31 December 2021 is as follows:
Amber Stanton
LLB
(General Counsel / Company Secretary until 23 July 2021)
Ms Amber Stanton is a corporate lawyer and was appointed as
General Counsel / Company Secretary in August 2017. Prior to
joining Resolute, Ms Stanton was a partner at two international
law firms, specialising in mergers and acquisitions, capital
markets, energy and resources and general corporate and
commercial matters. Ms Stanton was the winner of the 2011
Telstra Business Women’s Award (Corporate and Private Sector).
Interests in the shares and options of
Resolute and related bodies corporate
As at the date of this report, the interests of the Directors
in shares, options and Performance Rights of Resolute and
related bodies corporate were:
M. Botha
S. Gale
A. Reynolds
M. Potts
S. Shugg
S. Jackson
Total
Fully Paid
Ordinary Shares
Performance
Rights
195,455
-
-
2,669,235
50,000
123,541
27,273
-
-
-
-
-
396,269
2,669,235
As at the date of this report, there were no options on issue held
by Directors.
Nature of Operations and Principal Activities
The principal activities of entities within the consolidated entity
during the year were:
• gold mining
• prospecting and exploration for minerals.
There has been no significant change in the nature of those
activities during the year.
51
Resolute Mining Limited 2021 Annual ReportFinancial Report
Financial Report
Remuneration
Report
The following information
has been audited.
The Remuneration Report
outlines the Director and
Executive remuneration
arrangements of the Company
and the Group in accordance
with the requirements of
the Corporations Act 2001
and its Regulations.
The following information has been audited as required
by section 308(c) of the Corporations Act 2001.
The Remuneration Report is presented under the
following sections:
1. Letter from the Chair of the Remuneration Committee
2. Remuneration governance
3. Remuneration policy and outcomes
4. Non-Executive Director (NED) remuneration
arrangements and outcomes
5. Additional disclosures
6. Loans to Key Management Personnel (KMP)
and their related parties.
52
Resolute Mining Limited 2021 Annual Report
1. Letter from the Chair of the Remuneration Committee
Dear Shareholders,
On behalf of the Board of Directors of Resolute I am pleased to
present the Company’s Remuneration Report for the full financial
year ended 31 December 2021.
The next period in which an LTIP grant will be tested to
determine the level of vesting is 31 December 2022, for awards
granted on 1 January 2020 and the CEO Performance Rights.
The Company’s last Remuneration Report for the year ended
31 December 2020 received substantial support at the
Company’s annual general meeting held on 27 May 2021, with
98.00% of votes in favour of the report. We continue to engage
with Shareholders and proxy advisors on our remuneration
framework and disclosure.
Non-Executive Director Remuneration
The Chairman’s fee is A$180,000 and NED fees are A$100,000.
In addition, the Chair of the Audit and Risk Committee receives
a Committee Chair fee of A$15,000 and the Chair of the
Remuneration Committee receives a Committee Chair fee of
A$10,000. Members of Committees do not receive a separate fee.
The Board is satisfied that the current remuneration framework
is appropriate, fit-for-purpose consistent with our business
strategy and rewards high performance. As a result, only minor
changes were made to the Long-Term Incentive Plan (LTIP)
during 2021. We continue to strive to provide a high level of
disclosure and transparency of our remuneration framework,
particularly with regard to:
•
•
•
•
Objectives of our remuneration framework
Pay mix (the disclosure of the pay mix and total remuneration
opportunity is discussed at maximum levels as opposed to
target remuneration)
Short Term Incentive Plan (STI) targets and outcomes
CEO long term incentive (LTI) arrangements.
Remuneration Outcomes
Actual performance for the year ended 31 December 2021 for the
KMP STIP outcome was 32% of the maximum outcome possible.
Performance Rights were granted in 2018 (performance hurdle
tested) with a vesting date of 30 June 2021. Of the 1,164,726
Performance Rights granted, 38,814 Performance Rights vested
on 30 June 2021, representing a 6% vesting outcome.
The Reserves and Resources Growth performance hurdle
outcome, which accounts for 25% of the total vesting outcome,
was 64%, triggering vesting. No Performance Rights were
granted linked to the TSR hurdle, which accounts for 75% of the
total vesting outcome.
Performance Rights were granted in 2019 (performance
hurdle tested) with a vesting date of 31 December 2021. Of the
2,727,349 Performance Rights granted, 389,650 Performance
Rights vested on 31 December 2021, representing a 14%
vesting outcome.
The Reserves and Resources Growth performance hurdle
outcome, which accounts for 25% of the total vesting outcome,
was 100%, triggering vesting. No Performance Rights were
granted linked to the TSR hurdle, which accounts for 75% of
the total vesting outcome.
Proposed Remuneration Changes for 2021
Long Term Incentive Plan
The LTI comparator group used to measure relative Total
Shareholder Return (TSR) is reviewed annually prior to LTIP
invitations being dispatched to ensure relevant companies
are included, being gold producers of a similar size operating,
mostly, in similar jurisdictions. Details of the performance criteria
for the LTIP and the comparator group of companies is included
in the Remuneration Report in Section 3.
Our remuneration strategy is underpinned by our core values
and performance culture which includes setting challenging
stretch operational, financial and non-financial targets, and
rewarding their achievement.
Our key focus areas are sustainability, growth, innovation,
value creation and long-term stability, with the Board exercising
discretion to recognise achievement where outcomes may not
accurately reflect performance.
We will commit to consider the concerns and suggestions
regarding Executive pay and remuneration disclosure and
outcomes raised by our Shareholders and engage with the
required regulatory and external advisory services where required.
We thank our Shareholders for their continued support.
Yours sincerely
Mark Potts
Chair - Remuneration Committee
53
Resolute Mining Limited 2021 Annual ReportFinancial Report Financial Report
54
Resolute Mining Limited 2021 Annual Report
2. Remuneration Governance
Remuneration Committee
The Remuneration Committee is responsible for determining and
reviewing the compensation arrangements for Non-Executive
Directors, the Chief Executive Officer and Executives. Executive
remuneration is reviewed annually having regard to individual
and business performance, internal relativities and external
market information. The Remuneration Committee is also tasked
with determining performance targets, performance against
those targets and remuneration outcomes.
In accordance with best practice governance, the Remuneration
Committee is comprised solely of independent Non-Executive
Directors, as follows:
• Mark Potts (Chair)
• Martin Botha
• Yasmin Broughton (until 28 October 2021)
• Simon Jackson (effective 29 October 2021)
• Peter Sullivan (until 27 May 2021)
• Adrian Reynolds (effective 28 May 2021)
• Sabina Shugg.
Nomination Committee
The Nomination Committee is responsible for Board and
Board Committee membership, succession planning and
performance evaluation. In accordance with best practice
governance, the Nomination Committee is comprised solely
of independent Non-Executive Directors, as follows:
• Martin Botha (Chair)
• Mark Potts
• Yasmin Broughton (until 28 October 2021)
• Simon Jackson (effective 29 October 2021)
• Peter Sullivan (until 27 May 2021)
• Adrian Reynolds (effective 28 May 2021)
• Sabina Shugg.
Use of Remuneration Consultants
To ensure the Remuneration Committee is fully informed when
making remuneration decisions, it seeks external remuneration
advice as appropriate. Remuneration consultants are engaged by,
and report directly to, the Remuneration Committee. In selecting
remuneration consultants, the Remuneration Committee considers
potential conflicts of interest and requires independence from KMP
and other Executives as part of their terms of engagement.
During 2021, no remuneration consultants were engaged.
No other consultants were engaged and there were no
remuneration recommendations, as defined by the
Corporations Act, provided during the year.
Reporting in United States Dollars
In this report the remuneration and benefits reported have been
presented in US dollars. This is consistent with the change by
Resolute in presentational currency from Australian dollars to
US dollars from 1 January 2020. Compensation for KMP is paid
in Australian dollars and, for reporting purposes, converted to
US dollars based on the average exchange rate for the
payment period.
In order to derive US dollar comparatives between 2021
and 2020, the Australian dollar compensation paid during
the year ended 31 December 2021 was converted to US dollars
at the average exchange rate of US$1: A$1.332. The Australian
dollar compensation paid during the year ended 31 December
2020 was converted to US dollars at the average exchange
rate of US$1: A$1.448.
3. Remuneration Policy and Outcomes
3a. Key Management Personnel
The Remuneration Report details the remuneration arrangements
for KMP who are defined as those persons having authority and
responsibility for planning, directing and controlling the major
activities of the Company and the Group, including any Director
(whether Executive or otherwise) of the parent company.
For the purposes of this report, the term “Executive”
includes the Chief Executive Officer (CEO) and other
select Executives of the Company and the Group.
Directors
Executives
DIRECTOR
M. Botha
DIRECTOR
S. Gale
DIRECTOR
DIRECTOR
Y. Broughton
DIRECTOR
DIRECTOR
S. Jackson
DIRECTOR
S. Shugg
DIRECTOR
A. Reynolds
DIRECTOR
DIRECTOR
P. Sullivan
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Non-Executive Director
(Non-Executive Chairman)
EXECUTIVE
T. Holohan
Managing Director and
Chief Executive Officer
(appointed effective 14 May 2021,
Interim Chief Executive Officer until
13 May 2021, and Chief Financial
Officer until 29 August 2021)
EXECUTIVE
D. Kelly
Non-Executive Director
(until 28 October 2021)
EXECUTIVE
D. Warden
Non-Executive Director
(effective 29 October 2021)
EXECUTIVE
A. Stanton
Non-Executive Director
EXECUTIVE
R. Steenhof
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Chief Operating Officer
(appointed effective 17 May 2021)
Chief Operating Officer
(until 16 May 2021)
Chief Financial Officer
(appointed effective
30 August 2021)
General Counsel and
Company Secretary
(until 23 July 2021)
Company Secretary
(appointed effective 23 July 2021)
Non-Executive Director
(effective 28 May 2021)
Non-Executive Director
(until 27 May 2021)
55
Resolute Mining Limited 2021 Annual ReportFinancial Report
Financial Report
3b. Remuneration Policy
The Board recognises that the performance of the Company
depends upon the quality of its Executives. To achieve its
financial and operating objectives while operating in Africa, the
Company must attract, motivate and retain highly skilled Directors
and Executives. The Remuneration Committee is tasked with the
responsibility to monitor and review the remuneration framework
and provide recommendations to the Board.
As part of the continual review process, the Remuneration
Committee has from time to time engaged external consultants
regarding structural changes to the remuneration framework.
The Company embodies the following principles in its
remuneration framework:
•
Provides competitive rewards to attract high
calibre Executives
•
Structures remuneration at a level that reflects the Executive’s
duties and accountabilities and is competitive within Australia
• Benchmarks remuneration against appropriate groups
•
•
Aligns Executive incentive rewards with the creation of value
for Shareholders
Supports achievements consistent with the World Gold
Council’s Responsible Gold Mining Principles.
It is the Remuneration Committee’s policy that employment
contracts are entered into with the CEO and Executives.
Details of these contracts are outlined later in this report.
In accordance with good governance, the structure of NED
and Executive remuneration is separate and distinct.
Our Purpose
We are a trusted and responsible gold miner, driven by excellence to create value
for shareholders and the communities in which we operate.
The Company’s remuneration framework aims to incentivise for operational, financial and sustainability performance.
Specifically, we focus on growth in gold production, managing cost, and improving operating cash-flows,
whilst ensuring the health, safety and wellbeing of our people at all times.
Remuneration Objectives
Competitive Remuneration
Provide rewards to attract, motivate and
retain highly skilled Executives.
The Company aims to attract talent, and reward
Executives with a level and mix of remuneration
commensurate with their position and responsibilities
within the Company and to ensure total remuneration
is competitive by market standards.
Shareholder Alignment
Align Executive incentive rewards with the
creation of value for Shareholders.
Resolute’s goal is to maintain its status as a unique and
highly attractive investment for Shareholders, with focus on
sustainable value creation. The remuneration framework
serves to ensure sustainable growth and share price appreciation,
a healthy balance sheet, and an ability to pay dividends.
.
56
Resolute Mining Limited 2021 Annual Report 3c. Remuneration Framework
The Executive remuneration framework consists of Fixed Annual Remuneration (FAR), STI and LTI incentives as outlined in the table below:
Purpose
Link to Performance
t
n
e
n
o
p
m
o
C
n
o
i
t
a
r
e
n
u
m
e
R
FAR
The level of FAR is set to provide
a base level of remuneration which
is both appropriate to the position and
is competitive in the market.
STI
LTI
The objective of the annual “at risk” STI
is to generate greater alignment between
performance and remuneration levels to drive
operational excellence.
The objective of the LTI is to reward
Senior Leadership in a manner which
aligns a significant portion of
remuneration with the creation
of Shareholder wealth.
Overall remuneration level and mix
Company and individual performance are considered as part of
the annual remuneration review. While market and sector peer
benchmarking is conducted regularly to ensure the FAR remains
competitive, the levels of FAR for the Managing Director and CEO
and other Executives are set primarily with regard to their
responsibilities and performance, talent, skills and experience,
taking into account the size, complexity, scope of operations and
structure of Resolute’s business.
Internal performance measures including sustainability,
production and costs which represent key business drivers are
considered and assessed to determine annual outcomes.
Vesting of awards is dependent upon an external measure of TSR
performance against a peer group.
How is overall remuneration
and mix determined?
Remuneration levels are considered annually through a review that considers
comparative market data, the performance of the Company and individual, and the
broader economic environment.
The Company aims to reward Executives with a level and mix (proportion of fixed,
short-term incentives and long-term incentives) of remuneration appropriate to their
position, responsibilities and performance within the Company and that which is aligned
with targeted market comparators.
In 2021, remuneration benchmarking was undertaken with reference to industry peers
(see LTI comparator groups listed below) for the TSR performance benchmarking. From
time to time, depending on availability and reliability of data, other benchmarking data
sources may be used. The Company’s policy is to position FAR around the median of
direct industry peers.
The chart below summarises the Managing Director and CEO’s and other Executives’
remuneration mix for FAR, STI and LTI. The current pay mix is considered appropriate
for Resolute based on the Company’s current phase of growth. The pay mix for the
Managing Director and CEO includes the KMP LTI but does not include the CEO LTI
granted to Mr Gale during the year.
Remuneration Mix
Other Executives
47%
23%
30%
Managing Director/CEO
40%
20%
40%
0%
20%
40%
60%
80%
100%
FAR %
STIP %
LTIP %
To achieve maximum remuneration opportunity (equivalent to stretch targets being
achieved), Executives are required to significantly perform above and beyond normal
expectations. If achieved, the outcome is anticipated to result in a substantial improvement
in key strategic outcomes, operational or financial results, and/or the overall performance
of the Company.
While the Company does not have a formal share ownership policy for Executives, all
KMP are encouraged to hold shares in the Company and are incentivised to accumulate
equity through the participation in the LTI Program.
57
Resolute Mining Limited 2021 Annual ReportFinancial Report
3c. Remuneration Framework (continued)
Fixed annual remuneration
What is included in FAR?
FAR includes base salary and superannuation contributions.
How is FAR reviewed and approved?
FAR is reviewed annually by the Remuneration Committee following consideration
of Executive performance, industry benchmarking and macro-economic indicators.
FAR increases were made as follows:
Name
Stuart Gale(i)
2020 FAR
A$
625,000
2021 FAR
A$
725,000
Increase
%
16%
(i) The increase in FAR was to reflect the change in Mr S. Gale’s position from Interim CEO to CEO.
Short Term Incentive
What is the value of the STI award
maximum opportunity?
The Managing Director and CEO and Executives have a maximum opportunity (if all
the Stretch performance hurdles are met for each KPI and individual performance is
achieved at a Stretch level) of 112.5% of FAR. A target STI opportunity of 50% of FAR
aligns with industry benchmarking.
What are the performance
criteria and how do they align
with business performance?
The STI payable is based on performance against corporate and individual key
performance indicators (KPIs) set at the beginning of the performance period.
KPIs require the achievement of strategic, operational or financial measures and
are linked to the drivers of business performance.
Corporate KPIs
Personal KPIs
Sustainability
Demonstrated improvement from the
prior year in Group Sustainability
performance / systems in accordance
with the Responsible Gold Mining
Principles (10%).
Operational
The achievement of defined Targets
relative to budget relating to:
• operating cash flow (30%)
• gold poured (30%)
• cost per tonne milled (30%).
The targets with regard to the STI outcomes
are documented below (refer to section
3d Executive Remuneration Outcomes).
A set of personal performance metrics
designed to drive optimum operational
performance as specifically related to
each Executive’s portfolio.
The personal metrics are set annually
and are directly linked to the Resolute
strategic plan which drives each
Executive’s annual business plan.
Personal performance acts as a
positive or negative multiplier to the
outcome of the Corporate KPIs. See
below for an example of how the
Managing Director and CEO’s STI
award is calculated.
These measures have been selected as they can be reliably measured, are key drivers
of value for Shareholders and encourage behaviours in line with the Company’s Values
and risk appetite.
58
Resolute Mining Limited 2021 Annual ReportFinancial Report
3c. Remuneration Framework (continued)
Short Term Incentive
How are STI awards determined?
For each KPI there are defined “Threshold”, “Target” and “Stretch” measures which are
capable of objective assessment.
Corporate KPIs are assessed as follows on an individual KPI basis:
• Below Threshold = $nil payment
• Threshold performance = 25% of KPI opportunity
• Target Performance = 100% of KPI opportunity
• Stretch performance = 150% of KPI opportunity.
Pro-rata payment applies on a straight-line basis between “Threshold” and “Target”
and between “Target” to “Stretch” performance.
Personal KPIs are assessed as follows:
• Below Threshold = $nil payment
• Threshold performance = 50% of total Corporate KPI outcome
• Target Performance = 100% of total Corporate KPI outcome
• Stretch performance = 150% of total Corporate KPI outcome.
Pro-rata payment applies on a straight-line basis between “Threshold” and “Target”
and between “Target” to “Stretch” Performance. Target performance represents
challenging levels of performance. Stretch performance requires significant performance
above and beyond normal expectations and if achieved is anticipated to result in a
substantial improvement in key strategic outcomes, operational or financial results,
and/or the overall performance of the Company.
As a minimum, a threshold performance outcome must be achieved for both the
Corporate KPIs and the Personal KPIs before a STI award is triggered.
59
Resolute Mining Limited 2021 Annual ReportFinancial Report
3c. Remuneration Framework (continued)
Short Term Incentive
STI award example
The example below is based upon the Managing Director and CEO’s FAR, indicating
possible payments based upon the range of corporate performance outcomes and
personal KPI achievement.
Corporate KPI Award Opportunity
(Based upon MD and CEO 50% STIP on a FAR of $725,000
Performance
Award Opportunity %
Award Opportunity %
Below Threshold
0% of KPI Opportunity
Threshold
25% of KPI Opportunity (12.5% of FAR)
Target
Stretch
100% of KPI Opportunity (50% of FAR)
150% of KPI Opportunity (75% of FAR)
Nil
$90,625
$362,500
$543,750
Personal KPI Achievement
Total STIP Award Opportunity
Corporate KPI Outcome
Maximum Target Threshold Below
Performance
Personal KPI Multiplier
$543,750 $362,500 $90,625
Below Threshold 0%
Nil
Nil
Nil
Threshold
Target
Stretch
50% of Corporate
KPI Outcome
100% of Corporate
KPI Outcome
150% of Corporate
KPI Outcome
$271,875
$181,250
$45,313
$543,750 $362,500 $90,625
$815,625 $543,750 $135,938
Nil
Nil
Nil
Nil
Nil
The maximum STI award opportunity of FAR is calculated as follows:
(a) A$725,000 is Managing Director and CEO’s FAR
(b) A$815,625 is maximum KPI outcome (150% of Corporate KPI outcome).
Therefore, the maximum award opportunity of FAR for the Managing Director and CEO
is capped at 112.5% ((b)/(a)*100 = 112.5%).
Is the STI award subject to
deferral provisions?
The actual STI payment is made approximately three months after the completion of the
performance period.
The Remuneration Committee has determined that a formal deferral policy is not
appropriate at this time for KMP, given that a significant portion of the Managing
Director and CEO’s and other Executives’ total remuneration opportunity is in the form
of equity and subject to risk. In addition, the Managing Director and CEO and other
Executives have been granted a significant number of Performance Rights as part of the
Resolute LTIP, ensuring close alignment with Shareholders.
Is there a malus or clawback policy?
While there is no formal malus/clawback policy, the Board has ultimate discretion to
adjust the STI outcomes upwards or downwards (including to zero), in exceptional
circumstances, where the STI generated outcomes are inconsistent with the Company’s
performance or resulted in misalignment with Shareholders (e.g. fatality, financial
misstatement, misconduct, reputational damage, etc.).
What happens to STI awards if there
is a termination of employment?
Subject to overarching Board discretion, to be eligible for any payment under the STI, the
participant must be employed by the Company at the end of the relevant performance
period in which the STI is tested, unless a pro-rata payment is expressly agreed in
writing with the Managing Director prior to termination.
What happens to STI awards if there
is a change of control event?
On the occurrence of a change of control event, the Board will determine, in its sole and
absolute discretion, the manner in which STI awards will be dealt with.
60
Resolute Mining Limited 2021 Annual ReportFinancial Report
3c. Remuneration Framework (continued)
Long Term Incentive
How often are LTI grants made and
what is the maximum LTI quantum?
At the Board’s discretion, Executives receive an annual grant of Performance Rights and
the LTI forms a key component of the Executive’s Total Annual Remuneration.
The LTI face value that Executives are entitled to receive is set at a maximum percentage
of their FAR, being 100% of FAR for the Managing Director and CEO and 65% of FAR for
the other Executives.
What are the performance criteria
for the LTI?
Performance conditions have been selected that reward Executives for creating
Shareholder value as determined via the change in the Company’s share price (Relative
Total Shareholder Return) over a three-year period.
Performance Rights will vest subject to meeting service and performance conditions as
defined below:
Relative Total Shareholder Return (“rTSR”) – 100%
The rTSR measures the combined return from change in share price and dividends, against
16 ASX or TSX listed gold production companies of a similar size which for 2021 were:
• B2Gold Corp
• Centamin Plc
• Endeavour Mining
• Galliano Gold Inc
• Ramelius Resources Ltd
• Regis Resources Ltd
• Roxgold Inc
• Shanta Gold Ltd
• Golden Star Resources
• Silver Lake Resources Ltd
• Hummingbird Resources Plc
• St Barbara Ltd
• IAMGold Corporation
• West African Resources Ltd
• Perseus Mining Limited
Resolute’s rTSR is calculated to determine what percentile in the peer group it relates to
and this percentile determines how many Performance Rights vest.
What is the objective of the
performance hurdle and target?
One of Resolute’s goals is to manage achievements against comparators and outperform
our peers to ensure sustainable growth to our share price above the market.
What is the rationale for the
chosen metrics?
The rTSR metric provides the closest alignment between the Company’s performance
and Shareholders’ interests and reflects the creation of Shareholder value above peers.
The Board acknowledges that rTSR may result in vesting under negative absolute
TSR (“aTSR”). However, the Board has absolute discretion to amend the vesting
outcomes both downwards and upwards, should the conditions of the plan result in an
inappropriate vesting. The Board will limit this discretion to extraordinary circumstances.
rTSR is considered the most relevant performance metric for KMP LTI purposes. For this reason,
the Board has allocated 100% of the KMP LTI vesting performance metric to this measure.
How is the performance
period determined?
Grants under the LTI need to serve a number of different purposes:
• act as a key retention tool; and
• focus on future Shareholder value generation.
Therefore, LTI awards have a three-year performance period and provide a structure
that is focused on long term sustainable Shareholder value generation.
How is vesting determined?
Relative TSR performance
Performance Vesting Outcomes
Less than 50th percentile
At the 50th percentile
Between 50th and 75th percentile
0% vesting
50% vesting
Between 50% and 100% vesting,
calculated on a linear basis
75th percentile and above
100% vesting
61
Resolute Mining Limited 2021 Annual ReportFinancial Report
3c. Remuneration Framework (continued)
Long Term Incentive
Is there an opportunity to re-test
the performance hurdles?
Performance is tested only once, at the end of the performance period. No re-testing
applies to unvested awards.
Do dividends vest on
unvested awards?
Is there a malus and
clawback policy?
There are no dividends attached to unvested Performance Rights.
While there is no formal malus/clawback policy, the Board has ultimate discretion
to adjust LTI outcomes upwards or downwards (including to zero), in exceptional
circumstances, where the LTIP generates outcomes inconsistent with the Company’s
performance or resulted in misalignment with Shareholders (e.g. financial misstatement,
misconduct, reputational damage, etc.).
What happens to LTI awards if there
is a termination of employment?
Vested but unexercised Performance Rights remain valid unless Board discretion
is exercised in situations such as misconduct. Unvested Performance Rights will be
forfeited unless Board discretion is exercised in circumstances such as death,
retirement due to ill health and redundancy.
What happens to LTI awards if there
is a change of control?
On the occurrence of a change of control event, the Board will determine, in its sole and
absolute discretion, the manner in which all unvested and vested rights will be dealt with.
CEO Long Term Incentive Performance Rights
How many awards were granted?
The Managing Director and CEO were granted 1,000,000 Performance Rights with a
vesting date of 31 March 2024 with performance measured from 1 April 2021.
No other Executive participates in the CEO LTI.
What are the performance metrics
for this award?
rTSR – 50%
Strategic Objectives – 50%
The rTSR measures the combined
return from change in share price and
dividends, against 16 ASX or TSX listed
gold production companies of a similar size
(refer to page 61).
Resolute’s TSR is calculated to determine
what percentile in the peer group it relates
to and this percentile determines how many
Performance Rights vest.
The strategic objectives metric
measures the Board’s assessment
of the performance of the CEO in
ensuring achievement by the Company
of key strategic objectives over the
relevant performance period.
How is vesting determined?
Refer to page 61 for Relative TSR
Performance and Performance
Vesting Outcomes.
• Sustainable, reliable, efficient, lower
cost production at Syama - at or
above current capacity levels
• Balance sheet strength through improved
cash flows and net debt position
• Life of Mine extensions for current
asset portfolio (Syama/Tabakoroni
and Mako)
• Expand and diversify the asset
portfolio to increase overall
production lowering operational
and jurisdictional risk.
Notes
The Board reserves the right to adjust vesting outcomes after consideration of year-on-year
improvement in sustainability performance / systems and cultural measures.
62
Resolute Mining Limited 2021 Annual Report
Financial Report
3d. Remuneration Policy and Outcomes
Company Performance
The table below shows the performance of the Consolidated Entity over the last 5 periods:
31 December
2021
31 December
2020
31 December
2019
6 months
ended
31 December
2018
Net (loss)/profit after tax
$'000
Basic (loss)/earnings per share cents/share
(367,471)
(28.92)
4,995
1.62
(78,824)
(8.30)
(3,752)
(0.30)
30 June
2018
60,339
6.86
KMP remuneration disclosures
Table 1 below shows the remuneration expense recognised for each KMP for the year ended 31 December 2021. Table 2 below shows
the remuneration expense recognised for each KMP for the year ended 31 December 2020. The actual remuneration received by KMP
for the year is set out in Table 3. The actual remuneration includes equity grants where the KMP received control of the shares in the
year ended 31 December 2021. This differs from the remuneration disclosures in Table 1. For example, Table 1 discloses the value of LTI
grants which may or may not vest in future years, whereas Table 3 discloses the value of LTI grants from previous years which have
vested during the year.
Table 1 - Statutory KMP remuneration for the year ended 31 December 2021
Short Term Benefits
Post
Employment
Benefits
Long
Term
Benefits
Share
Based
Payments
Performance
Related
)
i
(
s
t
i
f
e
n
e
B
y
r
a
t
e
n
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$
n
o
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t
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e
n
u
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e
s
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$
)
i
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(
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$
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g
R
e
c
n
a
m
r
o
f
r
e
P
$
l
a
t
o
T
$
S. Gale(iii)
492,825
6,963
106,748
202,787
46,795
18,777
16,782
336,847
1,228,524
s
n
o
i
t
p
O
,
e
v
i
t
n
e
c
n
I
m
r
e
T
t
r
o
h
S
i
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
d
n
a
%
36
25
41
16
i
s
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
d
n
a
s
n
o
i
t
p
O
%
27
10
30
5
T. Holohan(v)
250,828
-
61,398
-
29,694
D. Kelly(vi)
152,090
3,482
47,753
75,106
11,460
D. Warden(vii)
134,423
2,321
22,307
A. Stanton(viii)
155,204
R. Steenhof(ix)
74,591
4,062
2,901
-
21,966
-
-
-
10,795
12,379
9,364
23,418
10,459
8,279
-
42,147
407,485
5,780
3,691
133,101
439,231
9,070
190,886
11,498
(26,820)
(58,476)
97,847
(60)
(60)
8,336
4,263
-
121,423
18
-
Total
1,259,961
19,729
260,172
277,893 120,487
80,767
3,696
462,689 2,485,396
(i)
Non-monetary benefits include, where applicable, the cost to the Company of providing fringe benefits, the fringe benefits tax on those benefits and all other benefits
received by the Executive.
(ii) The STI for the year ended 31 December 2021 will be paid in cash in March 2022.
(iii) Mr S. Gale was appointed as Chief Executive Officer effective 14 May 2021. Mr S. Gale was Interim Chief Executive Officer from 1 January 2021 to 13 May 2021.
(iv) This relates to a retention bonus for Mr S Gale and Mr D Kelly and a one-off dual duties payment in recognition of Mr Gale’s dual roles as Chief Financial Officer and Interim Chief
Executive Officer from 19 October 2020 to 14 May 2021.
(v) Mr T. Holohan was appointed as Chief Operating Officer effective 17 May 2021.
(vi) Mr D. Kelly ceased employment as Chief Operating Officer on 16 May 2021. Mr D Kelly remains with the Company as a member of the Leadership Team.
(vii) Mr D. Warden was appointed as Chief Financial Officer effective 30 August 2021.
(viii) Ms A. Stanton ceased employment as General Counsel and Company Secretary effective 23 July 2021.
(ix) Mr R. Steenhof was appointed as Company Secretary effective 23 July 2021.
(x)
The remuneration for 2021 was converted at the average exchange rate of US$1:A$1.332 and an average exchange rate of US$1:GBP€0.7270. Mr T. Holohan is remunerated in GBP
and the other KMPs are remunerated in A$.
63
Resolute Mining Limited 2021 Annual ReportFinancial Report
3d. Remuneration Policy and Outcomes (continued)
Table 2 - Statutory KMP remuneration for the year ended 31 December 2020
Short Term Benefits
Post
Employment
Benefits
Long
Term
Benefits
Share
Based
Payments
Performance
Related
s
n
o
i
t
p
O
,
e
v
i
t
n
e
c
n
I
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r
e
T
t
r
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h
S
i
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
d
n
a
%
36
36
44
38
i
s
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
d
n
a
s
n
o
i
t
p
O
%
36
20
24
18
n
o
i
t
a
r
e
n
u
m
e
R
e
s
a
B
$
J. Welborn(iii)
413,277
)
i
(
s
t
i
f
e
n
e
B
y
r
a
t
e
n
o
M
n
o
N
$
5,232
8,993
)
i
i
(
e
v
i
t
n
e
c
n
I
m
r
e
T
t
r
o
h
S
$
)
v
(
s
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n
o
i
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c
a
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n
a
r
T
$
e
s
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p
x
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e
v
a
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L
l
a
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n
n
A
$
n
o
i
t
a
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n
n
a
r
e
p
u
S
$
)
i
v
(
n
o
i
t
a
n
m
r
e
T
i
$
e
s
n
e
p
x
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v
a
e
L
e
c
i
v
r
e
S
g
n
o
L
$
i
s
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
$
l
a
t
o
T
$
-
- 41,424
30,990 535,072
(62,181) 533,548
1,497,362
D. Kelly
S. Gale(iv)
263,330
74,416
312,069
6,989
131,261
-
-
12,571
18,736
31,470
17,260
A. Stanton
218,961
6,279
117,206
96,658 27,423
17,260
-
-
-
6,291
98,214
482,551
10,247
164,478
673,774
11,603
111,957
607,347
Total
1,207,637
27,493 322,883
96,658 112,888 84,246 535,072 (34,040)
908,197 3,261,034
(i)
Non-monetary benefits include, where applicable, the cost to the Company of providing fringe benefits, the fringe benefits tax on those benefits and all other benefits received by
the Executive.
(ii) The STI for the year ended 31 December 2020 will be paid in cash in March 2021.
(iii) Mr J. Welborn ceased employment as Managing Director and CEO on 18 October 2020.
(iv) Mr S. Gale was appointed as Chief Financial Officer effective 20 January 2020 until 21 October 2020. Mr S. Gale was appointed Interim Chief Executive Officer effective 21 October 2020.
(v) This is a discretionary bonus related to the acquisition of Mako and the listing on the London Stock Exchange.
(vi) Mr J. Welborn received a payment in lieu of notice.
(vii) The total remuneration for 2020 was converted at the average exchange rate of US$1:A$1.448.
64
Resolute Mining Limited 2021 Annual ReportFinancial Report
3d. Remuneration Policy and Outcomes (continued)
The following table shows the nominal remuneration value realised by the individual and includes fixed remuneration, any cash
incentives paid and the nominal value of equity grants where the KMP received control of the shares in the year ended 31 December
2021. We believe this information is helpful to assist shareholders in understanding the actual pay and benefits received by KMPs
from various components of their remuneration.
The following table is a voluntary disclosure and is not prepared in accordance with Australian Accounting Standards.
Table 3 - Actual KMP remuneration paid for the year ended 31 December 2021
Fixed
Remuneration(i)
Dual Duties
Payment(v)
$
516,801
288,454
137,514
142,702
200,966
69,818
$
112,660
-
-
-
-
-
1,356,255
112,660
Short Term
Incentives(ii)
$
142,792
-
80,953
-
127,501
-
351,246
Nominal Value of
2018 and 2019 LTIP
Vested Rights(iii)
$
35,676
-
13,495
-
15,780
-
64,951
Total
$
807,929
288,454
231,962
142,702
344,247
69,818
1,885,112
S. Gale(iv)
T. Holohan(vi)
D. Kelly(vii)
D. Warden(viii)
A. Stanton(ix)
R. Steenhof(x)
Total
(i) Fixed Remuneration includes cash salary, paid leave and superannuation.
(ii) Short Term Incentives relate to Short Term Incentives earned for the year ended 31 December 2020 paid in March 2021.
(iii) 2018 LTIP vested rights awarded have a nominal value based on the 10-day VWAP up to and including 30 June 2021. 2019 LTIP vested rights awarded have a nominal value
based on the 10-day VWAP up to and including 31 December 2021.
(iv) Mr S. Gale was appointed as Managing Director and Chief Executive Officer effective 14 May 2021. Mr S. Gale was Interim Chief Executive Officer from 1 January 2021 to
13 May 2021.
(v) This is one-off dual duties payment in recognition of Mr Gale’s dual roles as Chief Financial Officer and Interim Chief Executive Officer from 19 October 2020 to 14 May 2021.
(vi) Mr T. Holohan was appointed as Chief Operating Officer effective 17 May 2021.
(vii) Mr D. Kelly ceased employment as Chief Operating Officer on 16 May 2021.
(viii) Mr D. Warden was appointed as Chief Financial Officer effective 30 August 2021.
(ix) Ms A. Stanton ceased employment as General Counsel and Company Secretary effective 23 July 2021.
(x) Mr R. Steenhof was appointed as Company Secretary effective 23 July 2021.
(xi) The remuneration for 2021 was converted at the average exchange rate of US$1:A$1.332 and an average exchange rate of US$1:GBP€0.7270. Mr T. Holohan is remunerated in
GBP and the other KMPs are remunerated in A$.
STI outcomes
Performance Measure
Performance Area
Weighting
Actual Performance
Outcome
Commentary
Company Operating Cash Flow ($235.067 million)
Cash Operating Cost Per Tonne Milled ($55.91)
Production Target (Gold Poured) (375,000oz)
Sustainability (YOY Improvement)
30%
30%
30%
10%
$56.428 million
Not Achieved
$59.99
319,271oz
Partially Achieved
Not Achieved
YOY Improvement
Achieved
65
Resolute Mining Limited 2021 Annual ReportFinancial Report
Financial Report
4. Non-Executive Director Remuneration Arrangements
and Outcomes
Objective
The Board seeks to set aggregate remuneration at a level which
provides the Company with the ability to attract and retain
Directors of the highest calibre, whilst incurring a cost which is
acceptable to Shareholders.
Structure
The Company’s constitution and the ASX Listing Rules specify
that the aggregate remuneration of NEDs shall be determined
from time to time by a general meeting. An amount not
exceeding the amount determined is then divided between
the Directors as agreed. The latest determination was at the
Annual General Meeting held on 29 November 2016 when
the Shareholders approved an aggregate remuneration of
A$1,000,000 per year.
The Chairman’s fee is A$180,000 and NED fees are A$100,000.
In addition, the Chair of the Audit and Risk Committee receives
a Committee Chair fee of A$15,000 and the Chair of the
Remuneration Committee receives a Committee Chair fee of
A$10,000. Members of Committees do not receive a separate fee.
The amount of aggregate remuneration sought to be approved
by Shareholders and the manner in which it is apportioned
amongst Directors is reviewed annually.
The Board considers fees paid to NEDs of comparable
companies when undertaking the annual review process.
Each NED receives a fee for being a Director of the Company.
The fee size is commensurate with the workload and
responsibilities undertaken. NEDs do not participate in any
incentive programs.
Position
Current Annual Fee (A$)
Chair of Board
Non-Executive Director
Audit and Risk Committee Chair
Remuneration Committee Chair
(*) Payable in addition to the annual NED fee.
Non-Executive Director remuneration for the year ended 31 December 2021
Short Term Benefits
Post Employment Benefits
Remuneration
$
Non-Monetary Benefits
$
Superannuation
$
$180,000
$100,000
$15,000(*)
$10,000(*)
Total
$
135,192
71,977
82,617
75,106
31,294
43,812
14,395
-
-
-
6,672
-
-
-
6,672
454,393
M. Botha
Y. Broughton
M. Potts
S. Shugg
P. Sullivan
A. Reynolds
S. Jackson
Total
135,192
71,977
82,617
68,434
28,206
43,812
14,395
444,633
-
-
-
-
3,088
-
-
3,088
(i) The total remuneration for 2021 was converted at the average exchange rate of US$1:A$1.332.
Non-Executive Director remuneration for the year ended 31 December 2020
Short Term Benefits
Post Employment Benefits
Remuneration
$
Non-Monetary Benefits
$
Superannuation
$
M. Botha
Y. Broughton
M. Potts
S. Shugg
P. Sullivan
Total
124,275
79,398
74,795
63,052
60,084
401,604
-
-
-
-
6,814
6,814
(i) The total remuneration for 2020 was converted at the average exchange rate of US$1:A$1.448.
-
-
-
5,990
3,076
9,066
Total
$
124,275
79,398
74,795
69,042
69,974
417,484
66
Resolute Mining Limited 2021 Annual Report
5. Additional Disclosures
Executive Employment Contracts
Remuneration arrangements for KMP are formalised in employment agreements. The following table outlines the details of contracts
with key management personnel:
Term of
Agreement
Notice Period
by Executive
Notice Period
by Company
Termination Benefit
Open
Open
Open
Open
Open
Open
6 months
12 months
Redundancy as per NES(1)
6 months
6 months
Redundancy as per UK ERA(2)
3 months
3 months
Redundancy as per NES(1)
6 months
6 months
Redundancy as per NES(1)
3 months
3 months
Redundancy as per NES(1)
1 month
1 month
Redundancy as per NES(1)
Name
Title
Stuart Gale(i)
Managing Director
and Chief Executive Officer
Terence Holohan(ii) Chief Operating Officer
David Kelly(iii)
Chief Operating Officer
Doug Warden(iv)
Chief Financial Officer
Amber Stanton(v)
General Counsel and Company Secretary
Richard Steenhof (vi) Company Secretary
(1) NES is the National Employment Standards.
(2) UK ERA is the UK Employment Rights Act.
(i) Appointed effective 14 May 2021.
(ii) Appointed effective 17 May 2021.
(iii) Until 16 May 2021.
(iv) Appointed effective 30 August 2021.
(v) Until 23 July 2021.
(vi) Appointed effective 23 July 2021.
No options were held by KMP during the year.
Details of Performance Rights holdings of KMP are as follows:
Granted during the year as compensation
r
a
e
y
e
h
t
f
o
t
r
a
t
s
e
h
t
t
a
e
c
n
a
a
B
l
r
e
b
m
u
N
e
t
a
d
e
u
s
s
I
e
c
n
a
m
r
o
f
r
e
P
f
o
e
u
a
v
r
i
a
F
l
l
a
t
o
T
e
t
a
d
t
n
a
r
g
t
a
s
t
h
g
R
i
e
c
n
a
m
r
o
f
r
e
P
f
o
e
u
a
v
r
i
a
F
l
e
t
a
d
t
n
a
r
g
t
a
s
t
h
g
R
i
A$
A$
Directors
S. Gale
764,343
904,892 14 May 2021
0.57 515,788
1,000,000 14 May 2021 0.48 480,000
Other key management personnel
i
s
t
h
g
R
e
c
n
a
m
r
o
f
r
e
P
f
o
y
r
i
p
x
E
e
c
n
a
m
r
o
f
r
e
P
f
o
e
c
i
r
p
e
s
i
c
r
e
x
E
r
a
e
y
e
h
t
g
n
i
r
u
d
d
e
t
n
a
r
g
s
t
h
g
R
i
A$
r
a
e
y
e
h
t
g
n
i
r
u
d
d
e
s
p
a
L
r
a
e
y
e
h
t
g
n
i
r
u
d
d
e
t
s
e
V
r
a
e
y
e
h
t
f
o
d
n
e
e
h
t
t
a
e
c
n
a
a
B
l
e
t
a
d
g
n
i
t
s
e
V
31 Dec 23 1 Jan 2028 nil
31 Dec 24 1 Jan 2028 nil
-
(125,000) 2,544,235
)
s
r
a
e
y
(
d
o
i
r
e
p
g
n
i
t
s
e
V
3
3
T. Holohan
-
443,716 14 July 2021 0.43
190,798
3 31 Dec 2023 1 Jan 2028 nil
-
-
443,716
D. Kelly(i)
423,055
324,513 14 July 2021 0.57
184,972
3 31 Dec 2023 1 Jan 2028 nil
(51,069)
(33,717)
662,782
D. Warden
-
264,171
6 Dec 2021 0.32
84,535
3 31 Dec 2023 1 Jan 2028 nil
-
-
264,171
A. Stanton(ii) 471,738
R. Steenhof
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(306,906)
(38,132)
126,700
-
-
-
(i) These were the number of Performance Rights held by Mr D. Kelly when he ceased employment as Chief Operating Officer on 16 May 2021.
(ii)
These were the number of Performance Rights held by Ms A. Stanton when she ceased employment on 23 July 2021. Of the 306,906 Performance Rights lapsed during the year,
242,314 Performance Rights lapsed due to cessation of employment.
(iii) Performance Rights vest in accordance with the Resolute Mining Limited Remuneration Policy and Equity Incentive Plan which outline the key performance indicators that need to
be satisfied. The percentage of Performance Rights granted during the year that also vested during the year is nil.
67
Resolute Mining Limited 2021 Annual ReportFinancial Report
5. Additional Disclosures (continued)
Details of shareholdings of KMP are as follows:
Received during
the year on the
vesting of
Performance
Rights
Balance at the
start of the year
Directors
M. Botha
S. Gale
M. Potts
S. Shugg
A. Reynolds
S. Jackson
Y. Broughton(i)
P. Sullivan
45,455
-
79,097
27,273
-
-
27,273
2,367,946
Other key management personnel
T. Holohan
D. Kelly(iii)
D. Warden
A. Stanton(iv)
R. Steenhof
-
113,578
-
-
-
-
-
-
-
-
-
-
-
-
-
-
40,625
-
Purchased
during the year
Other changes
during the year
Shares sold
on market
during the year
Balance at the
end of the year
150,000
-
44,444
-
50,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(27,273)
(2,367,946)
-
(113,578)
-
(40,625)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
195,455
-
123,541
27,273
50,000
-
-
-
-
-
-
-
-
(i) These were the number of shares held by Ms Y. Broughton when she resigned from the Board on 28 October 2021.
(ii) These were the number of shares held by Mr P. Sullivan when he resigned from the Board on 27 May 2021.
(iii) These were the number of shares held by Mr D. Kelly when he ceased employment as Chief Operating Officer on 16 May 2021.
(iv) These were the number of shares held by Ms A. Stanton when she ceased employment on 23 July 2021.
Every Director is encouraged to hold shares in the Company. The Board considered a share ownership requirement policy for
Directors, however, is not proposing to introduce a formal requirement due to the current tenure of Directors and to ensure that
diversity is one of the priorities without imposing limitations on any potential candidate. The Board will continue reviewing this policy
on an ongoing basis to ensure it meets the requirements of the Company and its stakeholders.
6. Loans to Key Management Personnel and their Related Parties
There were no loans to KMP during the year ended 31 December 2021.
This is the end of the audited information.
Performance Rights
Outstanding Performance Rights at the date of this report are as follows:
Grant date
Vesting date
Exercise price
Number on issue
26/10/18
21/05/19
21/05/20
21/05/20
21/05/20
14/05/21
14/05/21
68
30/06/21
31/12/21
31/12/21
31/12/21
31/12/22
31/12/23
31/03/24
-
-
-
-
-
-
-
35,561
1,014,933
500,000
43,668
1,400,975
3,747,596
1,000,000
7,742,733
Resolute Mining Limited 2021 Annual ReportFinancial Report 6. Loans to Key Management Personnel and their Related Parties (continued)
Indemnification and Insurance of Directors and Officers
Resolute maintains an insurance policy for its Directors and Officers against certain liabilities arising as a result of work performed
in the capacity as Directors and Officers. The Company has paid an insurance premium for the policy. The contract of insurance
prohibits disclosure of the amount of the premium and the nature of the liabilities insured.
Indemnification of Auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit
engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been
made to indemnify Ernst & Young during or since the financial year.
Auditor Independence
Refer to the Auditor’s Independence Declaration to the Directors of Resolute Mining Limited.
Directors’ Meetings
The number of meetings of Directors (including meetings of committees of Directors) held during the year and the number of
meetings attended by each Director were as follows:
Board
Audit and Risk
Remuneration
Nomination
Sustainability
M. Botha
P. Sullivan (until 27 May 2021)
S. Gale(i)
M. Potts
Y. Broughton (until 28 October 2021)
S. Shugg
A. Reynolds (effective 28 May 2021)
S. Jackson (effective 29 October 2021)
Number of meetings held
25
10
15
25
21
20
14
5
25
4
1
n/a
4
4
4
3
1
4
4
1
n/a
4
2
4
3
1
4
2
1
n/a
2
2
2
1
n/a
2
n/a
n/a
4
4
n/a
4
3
n/a
4
(i) Mr S. Gale was appointed Managing Director and Chief Executive Officer, effective 14 May 2021.
The details of the functions of the other committees of the Board are presented in the Corporate Governance Statement.
Rounding
Resolute is a company of the kind specified in Australian Securities and Investments Commission Corporations (rounding in Financial
Directors’ Reports) Instrument 2016/191. In accordance with that class order, amounts in the financial report and the Directors’ Report
have been rounded to the nearest thousand dollars unless specifically stated to be otherwise.
Non-Audit Services
Non-audit services have not been provided by the entity’s auditor, Ernst & Young for the year ended 31 December 2021.
Ernst & Young Australia received or are due to receive nil for non-audit services in the year ended 31 December 2021
(year ended 31 December 2020: $nil).
Signed in accordance with a resolution of the Directors.
Martin Botha
Chairman
Perth, Western Australia
29 March 2022
69
Resolute Mining Limited 2021 Annual ReportFinancial Report Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s independence declaration to the directors of Resolute Mining
Limited
As lead auditor for the audit of the financial report of Resolute Mining Limited for the financial year
ended 31 December 2021, I declare to the best of my knowledge and belief, there have been:
a.
b.
c.
No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
No contraventions of any applicable code of professional conduct in relation to the audit; and
No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of Resolute Mining Limited and the entities it controlled during the
financial year.
Ernst & Young
Fiona Drummond
Partner
29 March 2022
70
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Resolute Mining Limited 2021 Annual ReportFinancial Report
Contents
About this Report
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Cash Flow Statement
Notes to the Financial Statements
Earnings for the year
A
A.1 Segment revenues and expenses
A.2 Dividends paid or proposed
A.3
A.4 Taxes
(Loss)/earnings per share
Financial Report
72
74
76
77
78
79
79
82
82
83
B Production and growth assets
86
B.1 Mine properties and property, plant and equipment 86
B.2 Exploration and evaluation assets
88
Impairment of non current assets
B.3
88
B.4 Segment expenditure, assets and liabilities
92
Interest bearing liabilities
C Cash, debt and capital
C.1 Cash
C.2
C.3 Financing facilities
C.4 Contributed equity
C.5 Other reserves
D Other assets and liabilities
D.1 Receivables
D.2
Inventories
D.3 Other financial assets and liabilities
D.4 Payables
D.5 Provisions
D.6 Leases
D.7 Derivative financial liabilities
D.8 Financial instruments
Investments in associates
E Other items
E.1 Assets held for sale and discontinued operation
E.2 Contingent liabilities
E.3 Commitments
E.4 Auditor remuneration
E.5
E.6 Subsidiaries and non-controlling interests
E.7 Subsequent events
E.8 Related party disclosures
E.9 Parent entity information
E.10 Employee benefits and share-based payments
E.11 Other accounting policies
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
92
92
95
96
97
98
99
99
100
101
101
102
104
106
106
108
108
1 1 1
1 1 1
1 1 1
112
112
114
114
115
115
120
121
122
130
Resolute Mining Limited 2021 Annual Report
71
Financial Report
72
72
Resolute Mining Limited 2021 Annual Report
About this Report
The Financial Report of Resolute Mining Limited and its
controlled entities (“Resolute”, “consolidated entity” or the
“Group”) for the year ended 31 December 2021 was authorized
for issue on 29 March 2022 in accordance with a resolution of
the Directors.
Resolute Mining Limited (the parent) is a for profit company
limited by shares incorporated and domiciled in Australia
whose shares are publicly traded on the Australian Securities
Exchange and the London Stock Exchange. The nature of the
operations and principal activities of the Group are described
in the Directors’ Report and in the segment information in Note
A.1. Information on the Group’s structure is provided in Note E.6.
Statement of Compliance
This general purpose Financial Report has been prepared
in accordance with Australian Accounting Standards, other
authoritative pronouncements of the Australian Accounting
Board and the Corporations Act 2001 (Cth). The Financial
Report complies with Australian Accounting Standards as
issued by the Australian Accounting Standards Board and
International Financial Reporting Standards (IFRS) as issued by
the International Accounting Standards Board. The accounting
policies are consistent with those disclosed in the 31 December
2020 Financial Report, except for the impact of all new or
amended Standards and Interpretations as detailed in Note E.11.
The Financial Report includes financial information for Resolute
Mining Limited (“Resolute”) as an individual entity and the
consolidated entity consisting of Resolute and its subsidiaries
(“the Group”). Where appropriate, comparative information
has been reclassified to align to changes in presentation in the
current period to reflect more reliable and relevant information.
Basis of Preparation
These financial statements have been prepared under the
historical cost convention, as modified by the revaluation of
certain financial assets and liabilities at fair value.
The Financial Report comprises of the financial statements of
the Group and its subsidiaries as at 31 December each year.
Subsidiaries are fully consolidated from the date on which
control is obtained by the Group and cease to be consolidated
from the date at which control is transferred out of the Group.
Profit or loss and each component of Other Comprehensive
Income (OCI) are attributed to the equity holders of the parent
of the Group and to the non-controlling interests, even if this
results in the non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial
statements of subsidiaries to bring their accounting policies
into line with the Group’s accounting policies. All intra-group
assets and liabilities, equity, income, expenses and cash flows
relating to transactions between members of the Group are
eliminated in full on consolidation. Interests in associates are
equity accounted and are not part of the consolidated Group.
Resolute is in the process of renewing its Banque du
Développement du Mali S.A. (“BDM”) overdraft facility which
expired in March 2022. Taking into account the history of
renewal of this facility, Resolute does not see any reason for
the bank overdraft facility not to be renewed given that this
overdraft facility has been successfully extended year on
year for 12 years. The Group has adequate liquidity should
repayment of the facility be required.
Resolute Mining Limited 2021 Annual ReportFinancial Report Restatement of comparative information
Inventories write off and net realisable value movements are
shown separately on the Statement of Comprehensive Income
as it better reflects the results of operations of the Group. In
prior periods, these were included in “Fair value movements and
unrealised treasury transactions” and accordingly, comparative
have been restated to ensure consistency of presentation.
In addition, in preparing the financial statements for the year
ended 31 December 2021, it was noted that there was a
misstatement in the 31 December 2020 financial statement with
respect to the reversal of provision for net realisable value for
low grade stockpiles written off in 2020. The provision for net
realisable value was credited to “Cost of production relating
to gold sales” whereas the cost associated with the low grade
stockpile was presented in “Inventories write off and net
realisable value movements”. Comparative information has been
restated to net these off as they both relate to write down of the
low grade stockpile. The restatement has resulted in an increase
in “Cost of production relating to gold sales” of $46,787,000 and
a reduction in “Inventories write off and net realisable value
movements” in $46,787,000.
Rounding of Amounts
The Financial Report has been prepared in United States dollars
and all values are rounded to the nearest thousand dollars
($’000) unless otherwise stated.
Currency
Items in the financial statements of each of the Group’s entities
are measured in their respective currencies. Resolute Mining
Limited’s functional currency is Australian dollars (A$) and
presentation currency is United States dollars ($).
Transactions in foreign currencies are initially recorded by the
Group’s entities at their respective functional currency spot
rates at the date the transaction first qualifies for recognition.
Monetary assets and liabilities denominated in foreign
currencies are translated at the functional currency spot rates
of exchange at the reporting date. Differences arising on
settlement or translation of monetary items are recognised in
profit or loss with the exception of monetary items classified as
net investment in a foreign operation. These are recognised in
OCI until the net investment is disposed of, at which time, the
cumulative amount is reclassified to profit or loss. Tax charges
and credits attributable to exchange differences on those
monetary items are also recorded in OCI.
Non-monetary items that are measured in terms of historical
cost in a foreign currency are translated using the exchange
rates at the dates of the initial transactions. Non-monetary items
measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value is determined.
The gain or loss arising on translation of non-monetary items
measured at fair value is treated in line with the recognition
of the gain or loss on the change in fair value of the item
(i.e. translation differences on items whose fair value gain or loss
is recognised in OCI or profit or loss are also recognised in OCI
or profit or loss, respectively).
The results and financial position of all the Group entities
(none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
• assets and liabilities for each consolidated statement of
financial position presented are translated at the closing rate
at the date of that consolidated statement of financial position
•
income and expenses for each consolidated statement of
comprehensive income are translated at average exchange
rates (unless this is not a reasonable approximation of the
cumulative effect of the rates prevailing on the transaction
dates, in which case income and expenses are translated at
the dates of the transactions)
• all resulting exchange differences are recognised as a
separate component of equity.
On consolidation, exchange differences arising from the
translation of any net investment in foreign entities, and of
borrowings and other currency instruments that form part of
a net investment in foreign operation designated as hedges of
such investments, are taken to shareholders’ equity. When a
foreign operation is sold or borrowings repaid, a proportionate
share of such exchange differences are recognised in the
consolidated statement of comprehensive income as part of the
gain or loss on sale.
Financial and Capital Risk Management
The Group’s activities expose it to a variety of financial
risks: market risk (including diesel fuel price risk, currency
risk and interest rate risk), credit risk and liquidity risk. The
Group’s overall risk management program focuses on the
unpredictability of financial markets and seeks, where
considered appropriate, to minimise potential adverse effects
on the financial performance of the Group.
The Group may use derivative financial instruments to manage
certain risk exposures. Derivatives have been used exclusively
for managing financial risks, and not as trading or other
speculative instruments.
Risk management is carried out by the Group’s Audit and
Risk Committee under policies approved by the Board of
Directors. The Audit and Risk Committee identifies, evaluates
and manages financial risks as deemed appropriate. The Board
provides guidance for overall risk management, including
guidance on specific areas, such as mitigating commodity price,
foreign exchange, interest rate and credit risks, and derivative
financial instrument risk.
Foreign Exchange Risk Management
The Group receives proceeds on the sale of its gold and silver
production in United States dollar and Australian dollar and
a large portion of its costs at the Syama Gold Mine, Mako
Gold Mine and the Bibiani Gold Mine are denominated in
Euro, United States dollar and local currencies, and as such
movements within these currencies expose the Group to
exchange rate risk.
Foreign exchange risk arises from future commercial
transactions and recognised assets and liabilities denominated
in a currency that is not the entity’s functional currency. The
risk can be measured by performing a sensitivity analysis that
quantifies the impact of different assumed exchange rates on
the Group’s forecast cash flows.
The Group’s Audit and Risk Committee continues to manage
and monitor foreign exchange currency risk. At present, the
Group does not specifically hedge its exposure to foreign
currency exchange rate movements.
Diesel Price Risk Management
The Group is exposed to movements in the diesel fuel price.
The costs incurred purchasing diesel fuel for use in the Group’s
operations is significant. The Group’s Audit and Risk Committee
continues to manage and monitor diesel fuel price risk.
At present, the Group does not specifically hedge its exposure
to diesel fuel price movements.
The below risks arise in the normal course of the Group’s
business. Risk information can be found in the following
sections:
•
Section C Capital risk, Interest rate risk, Liquidity risk,
Foreign currency risk
• Section D Credit risk, Foreign currency risk.
73
Resolute Mining Limited 2021 Annual ReportFinancial Report
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2021
$’000
Continuing operations
Revenue from contracts with customers for gold and silver sales
Costs of production relating to gold sales
Gross profit before depreciation, amortisation and other operating costs
Depreciation and amortisation relating to gold sales
Other operating costs relating to gold sales
Gross profit from continuing operations
Interest income
Other income
Exploration and business development
Impairment of exploration and evaluation assets
Impairment of mine properties and property, plant and equipment
Administration and other corporate expenses
Share based payments expense
Treasury - realised gains/(losses)
Unrealised treasury transactions
Inventories write off and net realisable value movements
Share of associates’ losses
Depreciation of non-mine site assets
Finance costs
Other expenses
Indirect tax expense
Loss before tax from continuing operations
Tax expense
Loss for the year from continuing operations
Discontinued operations
Gain for the year from discontinued operations(1)
(Loss)/gain for the year
(Loss)/gain attributable to:
Members of the parent
Non-controlling interest
(Loss)/gain for the year
(1) Discontinued operations relates to the Group’s Ravenswood gold mine.
(2) Refer to restatement of comparative information note on page 73.
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Note
2021
2020
(Restated)(2)
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1
A.1/E.5
A.1
A.1
A.1
549,242
602,985
(324,984)
(301,635)
224,258
301,350
(118,621)
(172,606)
(59,066)
(71,339)
46,571
57,405
5,1 4 1
3,248
2,152
-
(18,484)
(10,910)
(5,068)
(222,396)
-
-
(15,687)
(17,456)
(1,122)
(185)
(27,697)
(44,258)
(3,838)
(2,372)
(1,178)
867
15,968
175
(1,661)
(2,725)
(16,882)
(24,676)
-
(88)
A.1/D.5
(24,760)
(24,308)
(327,789)
(6,435)
A.1/A.4
(39,682)
(30,045)
(367,471)
(36,480)
E.1
-
(367,471)
41,475
4,995
(319,203)
15,941
E.6
(48,268)
(10,946)
(367,471)
4,995
74
Resolute Mining Limited 2021 Annual ReportFinancial Report
Consolidated Statement of Comprehensive Income (continued)
for the year ended 31 December 2021
$’000
Note
2021
2020
(Loss)/gain for the year (brought forward)
(367,471)
4,995
Other comprehensive (loss)/income
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations:
- Members of the parent
Items that may not be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations:
- Non-controlling interest
Changes in the fair value/realisation of financial assets at fair value
through other comprehensive income, net of tax
Other comprehensive (loss)/gain for the year, net of tax
(16,106)
45,915
4,960
(5,651)
(12,981)
16,638
(24,127)
56,902
Total comprehensive (loss)/gain for the year
(391,598)
61,897
Total comprehensive (loss)/gain attributable to:
Members of the parent
Non-controlling interest
Total comprehensive (loss)/gain for the year
(Loss)/earnings per share for net income/(loss) attributable for operations
to the ordinary equity holders of the parent:
Basic (loss)/gain per share
Diluted (loss)/gain per share
Loss per share for net loss attributable for continuing operations
to the ordinary equity holders of the parent:
Basic loss per share
Diluted loss per share
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
(348,290)
78,494
(43,308)
(16,597)
(391,598)
61,897
cents
(28.92)
(28.92)
cents
(28.92)
(28.92)
cents
1.62
1.62
cents
(2.60)
(2.60)
A.3
A.3
A.3
A.3
75
Resolute Mining Limited 2021 Annual ReportFinancial Report
Consolidated Statement of Financial Position
for the year ended 31 December 2021
$’000
Current assets
Cash
Other financial assets – restricted cash
Receivables
Inventories
Financial assets at fair value through other comprehensive income
Assets held for sale
Prepayments and other assets
Assets sale receivable
Income tax asset
Total current assets
Non current assets
Income tax asset
Inventories
Investments in associates
Promissory notes receivable
Contingent consideration receivable
Deferred tax assets
Exploration and evaluation
Development
Property, plant and equipment
Right of use assets
Total non current assets
Total assets
Current liabilities
Payables
Financial derivative liabilities
Interest bearing liabilities
Provisions
Lease liabilities
Current tax liabilities
Liabilities associated with the assets held for sale
Total current liabilities
Non current liabilities
Interest bearing liabilities
Provisions
Deferred tax liabilities
Lease liabilities
Total non current liabilities
Total liabilities
Net assets
Equity attributable to equity holders of the parent
Contributed equity
Reserves
Retained earnings
Total equity attributable to equity holders of the parent
Non-controlling interest
Non-controlling interest of disposal group held for sale
Total equity
Note
2021
2020
C.1
D.3
D.1
D.2
D.3
E.1
E.1
A.4
D.2
E.5
E.1
E.1
A.4
B.2
B.1
B.1
D.6
D.4
D.7
C.2
D.5
D.6
E.1
C.2
D.5
A.4
D.6
C.4
E.6
E.1
67,607
9,443
27,812
156,589
20,828
-
12,868
56,495
-
88,591
-
78,852
158,929
36,004
80,608
8,785
-
17,911
351,642
469,680
18,273
53,918
1,365
40,207
14,524
-
2,909
264,491
229,164
7,708
-
67,923
4,649
40,262
15,417
10,081
6,469
495,281
292,678
22,518
632,559
955,278
984,201
1,424,958
91,542
-
92,726
57,165
2,991
7,137
-
83,832
415
62,558
75,720
11,249
-
8,821
251,561
242,595
223,979
73,424
1,591
8,086
307,080
558,641
425,560
273,613
71,863
9,422
12,358
367,256
609,851
815,107
777,021
(3,706)
(277,682)
777,021
24,175
41,521
495,633
842,7 17
(70,073)
(20,629)
-
(6,981)
425,560
815,107
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
76
Resolute Mining Limited 2021 Annual ReportFinancial Report Consolidated Statement of Changes in Equity
for the year ended 31 December 2021
y
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n
o
N
l
a
s
o
p
s
i
d
f
o
l
e
a
s
r
o
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e
h
p
u
o
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R
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At 1 January 2021
777,021
4,350
4,876
(724)
18,607
(2,934)
41,521
(20,629)
(6,981) 815,107
Loss for the year
Other comprehensive
(loss)/income, net of tax
Total comprehensive (loss)
/income for the year, net of tax
Shares issued
Dividends paid
Share based payments expense
Disposal of assets held for sale
-
-
-
-
-
-
-
(12,981)
(12,981)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,206
-
-
(319,203)
(47,929)
(339)
(367,471)
(16,106)
-
4,960
-
(24,127)
(16,106) (319,203)
(42,969)
(339) (391,598)
-
-
-
-
-
-
(6,475)
-
-
-
-
7,320
(6,475)
1,206
7,320
At 31 December 2021
777,021
(8,631)
4,876
(724)
19,813 (19,040) (277,682)
(70,073)
- 425,560
At 1 January 2020
639,859 (12,288)
4,876
(724)
17,077 (48,849)
25,580
(1,436)
- 624,095
Gain for the year
Other comprehensive
(loss)/income, net of tax
Total comprehensive (loss)
/income for the year, net of tax
-
-
-
-
16,638
16,638
Shares issued
Dividends paid
Share based payments expense
Disposal of assets held for sale
137,162
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,530
-
15,941
(10,946)
45,915
-
(5,651)
45,915
15,941
(16,597)
-
-
-
-
-
-
-
(9,577)
-
-
-
-
-
-
-
4,995
56,902
61,897
137,162
(9,577)
1,530
6,981
(6,981)
-
At 31 December 2020
777,021
4,350
4,876
(724)
18,607
(2,934)
41,521
(20,629)
(6,981) 815,107
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
77
Resolute Mining Limited 2021 Annual ReportFinancial Report
Consolidated Cash Flow Statement
for the year ended 31 December 2021
$’000
Note
2021
2020
Cash flows from operating activities
Receipts from customers
Payments to suppliers, employees and others
Exploration expenditure
Interest paid
Interest received
Indirect tax paid
Income tax paid
Settlement of Taurus royalty
Net cash flows from operating activities
Cash flows used in investing activities
Payments for property, plant and equipment
Payments for development activities
Payments for evaluation activities
Proceeds from sale of asset
Payments/proceeds relating to assets held for sale
Proceeds from sale of financial assets at fair value through other comprehensive income
Payments for sale of financial assets at fair value through other comprehensive income
Other investing activities
Net cash flows used in investing activities
Cash flows (used in)/from financing activities
Repayment of borrowings
Proceeds from finance facilities
Proceeds from issuing ordinary shares
Payments for share issue
Dividends paid to non-controlling interest
Repayment of lease liability
Net cash flows (used in)/from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Exchange rate adjustment
Cash and cash equivalents at the end of the year
Cash and cash equivalents comprise the following:
Cash at bank and on hand
Bank overdraft
Cash and cash equivalents at the end of the year
The above consolidated cash flow statement should be read in conjunction with the accompanying notes.
549,013
617,218
(451,554)
(496,999)
(13,643)
(6,052)
(14,874)
(20,221)
-
(14,853)
616
-
(3,531)
(32,610)
-
(12,000)
C.1
50,558
49,952
(30,387)
(49,724)
(22,908)
(35,455)
(2,926)
30,740
(5,445)
2,289
(1,179)
(697)
(5,799)
29,916
5,445
1,145
(5,603)
(418)
(30,513)
(60,493)
(79, 811)
(202,963)
50,000
-
-
(5,858)
(13,823)
110,000
137,428
(266)
(9,577)
(18,012)
(49,492)
16,610
(29,447)
6,069
55,226
48,237
(542)
920
25,237
55,226
C.1
C.1
67,607
88,591
(42,370)
(33,365)
25,237
55,226
78
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the
Financial Statements
A: Earnings for the year
IN THIS SECTION
Results and the performance of the Group, with segmental
information highlighting the core areas of the Group’s operations.
It also includes details about the Group’s tax position.
A.1 Segment revenues and expenses
Operating segment information
The Group has identified two operating segments based on
the internal reports that are reviewed and used by the Chief
Executive Officer and his executive team (the Chief Operating
Decision Maker) in assessing performance and in determining
the allocation of resources.
Operating segments are identified by management as being
operating mine sites and are managed separately and operate in
different regulatory and economic environments.
Performance is measured based on gold poured and cost of
production per ounce of gold poured. The accounting policies
used by the Group in reporting segments are the same as those
used in the preparation of financial statements.
Certain items and associated assets and liabilities are not allocated
to operating segments as they are not considered part of the core
operations of any segment, including but not limited to:
• finance costs
• share of associates’ losses
•
net gains/losses on disposal of fair value through other
comprehensive income (“FVTOCI”) investments.
Recognition and measurement
Revenue from gold and other sales
Revenue from gold and other sales represents revenue from
contracts with customers and is recognised at the point in time
when the Group transfers control of products to a customer. For
sales of gold bullion, control is obtained when the gold is credited
to the metals account of the customer. Revenue is recognised at
the amount to which the Group expects to be entitled.
Revenue from the sale of by-products such as silver is included
in sales revenue.
Interest
Interest revenue is recognised as interest accrues using the
effective interest method.
Borrowing costs
Borrowing costs incurred for the construction of any qualifying
asset are capitalised during the period of time that is required
to complete and prepare the asset for its intended use or sale.
Other borrowing costs are expensed and are included in profit or
loss as part of borrowing costs.
The capitalisation rate used to determine the amount of
borrowing costs to be capitalised is the weighted average
interest rate applicable to the entity’s outstanding borrowings
during the period.
Key estimates and judgements
Revenue from contracts with customers - Judgement is required
to determine the point at which the customer obtains control of
gold. Factors including transfer of legal title, transfer of significant
risks and rewards of ownership and the existence of a present
right to payment for the gold typically result in control transferring
on delivery of the gold.
Financial Report
Resolute Mining Limited 2021 Annual Report
7979
Resolute Mining Limited 2021 Annual ReportFinancial Review
Notes to the Financial Statements
for the year ended 31 December 2021
A.1 Segment revenues and expenses (continued)
31 December 2021
$’000
Revenue
Gold and silver sales at spot to external customers (a)
Total segment gold and silver sales revenue
Costs of production
Gold in circuit inventories movement
Costs of production relating to gold sales
Royalty expense
Operational support costs
Other operating costs relating to gold sales
Administration and other corporate expenses
Share-based payments expense
Exploration, business development and impairment of investments
Earnings/(loss) before interest, tax, depreciation and amortisation
Amortisation of evaluation, development and rehabilitation costs
Depreciation of mine site properties, plant and equipment
Unallocated (b)
Mako
(Senegal)
Syama
(Mali)
Corporate/
Other
Total
221,478
221,478
327,764
327,764
(87,541)
(245,920)
583
7,894
(86,958)
(238,026)
(11,074)
(17,528)
(21,863)
(5,344)
(28,602)
(27,207)
(5,060)
(1,617)
-
(3,512)
97,346
(15,600)
(40,262)
-
(4,802)
56,112
(25,894)
(36,865)
-
-
-
-
-
-
(3,257)
(3,257)
(9,010)
(1,122)
549,242
549,242
(333,461)
8,477
(324,984)
(32,937)
(26,129)
(59,066)
(15,687)
(1,122)
(10,170)
(18,484)
(23,559)
129,899
-
-
-
(41,494)
(77,127)
(118,621)
11,278
5,14 1
3,248
Depreciation and amortisation relating to gold sales
(55,862)
(62,759)
Segment operating result before treasury,
other income/(expenses) and tax
41,484
(6,647)
(23,559)
Interest income
Other income
Interest and fees
Gain on remeasurement for refinancing
Rehabilitation and restoration provision accretion
Finance costs
Realised foreign exchange (loss)/gain
Treasury - realised (loss)/gain
Unrealised foreign exchange gain/(loss) - other
Unrealised foreign exchange loss on intercompany balances
Unrealised treasury transactions
69
-
(434)
-
(165)
(599)
(1,431)
(1,431)
635
-
635
-
-
5,0721
3,248
(2,854)
(13,312)
(16,600)
-
(433)
316
-
316
(598)
(3,287)
(12,996)
(16,882)
387
387
-
-
-
859
859
(17,120)
(11,212)
(185)
(185)
(16,485)
(11,212)
(28,332)
(27,697)
Inventories write off and net realisable value movements
(53,188)
8,930
-
(44,258)
Share of associates’ losses
Depreciation of non-mine site assets
Impairment of exploration and evaluation assets
-
(151)
(4,808)
-
-
-
(3,838)
(2,221)
(260)
(3,838)
(2,372)
(5,068)
Impairment of non current assets
(55,023)
(167,373)
-
(222,396)
Indirect tax expense
Income tax expense
(9,026)
(1,413)
(9,874)
(34,424)
(5,860)
(3,845)
(24,760)
(39,682)
Loss for the 12 months to 31 December 2021
(83,451)
(212,288)
(71,732)
(367,471)
(1) This balance relates to interest income on the promissory note receivable and interest accretion on asset sales receivable.
80
Resolute Mining Limited 2021 Annual ReportFinancial Report Administration and other corporate expenses
(3,717)
(3,266)
(10,473)
Share-based payments expense
-
Exploration, business development and impairment of investments
(1,624)
Earnings/(loss) before interest, tax, depreciation and amortisation
172,272
A.1 Segment revenues and expenses (continued)
31 December 2020 (Restated)(1)
$’000
Revenue
Gold and silver sales at spot to external customers (a)
Total segment gold and silver sales revenue
Costs of production
Gold in circuit inventories movement
Costs of production relating to gold sales
Royalty expense
Operational support costs
Other operating costs relating to gold sales
Amortisation of evaluation, development and rehabilitation costs
Depreciation of mine site properties, plant and equipment
Depreciation and amortisation relating to gold sales
Segment operating result before treasury,
other income/(expenses) and tax
Interest income
Interest and fees
Loss on remeasurement for refinancing
Rehabilitation and restoration provision accretion
Finance costs
Realised foreign exchange (loss)/gain
Treasury - realised (loss)/gains
Unrealised foreign exchange (loss)/gain - other
Unrealised loss on derivative financial liability
Unrealised foreign exchange loss on intercompany balances
Unrealised treasury transactions
Inventories write off and net realisable value movements
Other expenses
Share of associates' losses
Depreciation of non-mine site assets
Indirect tax expense
Income tax expense
Profit/(loss) for the 12 months to 31 December 2020
(1) Refer to restatement of comparative information note on page 73.
Notes to the Financial Statements
for the year ended 31 December 2021
Unallocated (b)
Mako
(Senegal)
Syama
(Mali)
Corporate/
Other
Total
274,400
328,585
274,400
328,585
(59,019)
(236,519)
(5,578)
(519)
(64,597)
(237,038)
(13,720)
(18,470)
(23,365)
(12,304)
(32,190)
(35,669)
-
-
-
-
-
-
(3,480)
(3,480)
602,985
602,985
(295,538)
(6,097)
(301,635)
(37,085)
(34,254)
(71,339)
(17,456)
(1,178)
(10,910)
-
(2,512)
50,100
(20,116)
(63,335)
(83,451)
(1,178)
(6,774)
(21,905)
200,467
-
(40,128)
(1,290)
(132,478)
(1,290)
(172,606)
(33,351)
(23,195)
300
(1,493)
-
(392)
1,421
(14,235)
(4,711)
-
27,861
2,152
(19,187)
(4,711)
(778)
(20,012)
(67,853)
(87,865)
84,407
431
(3,459)
-
(386)
(3,845)
(1,885)
(18,946)
(24,676)
912
912
(1,650)
(1,167)
-
(2,817)
(5,304)
-
-
(133)
-
(15,768)
57,883
(381)
(381)
5
-
-
5
5,192
-
-
-
(24,308)
(4,184)
(58,612)
336
336
33,133
-
(14,353)
18,780
287
(88)
(1,661)
(2,592)
-
(10,093)
(35,751)
867
867
31,488
(1,167)
(14,353)
15,958
175
(88)
(1,661)
(2,725)
(24,308)
(30,045)
(36,480)
81
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
A.1 Segment revenues and expenses (continued)
(a) Revenue from external sales for each reportable segment is derived from several customers.
(b)
This information does not represent an operating segment as defined by AASB 8, however this information is analysed in this
format by the Chief Operating Decision maker, and forms part of the reconciliation of the results and positions of the operating
segments to the financial statements.
(c) Segment note references continuing operations.
(d)
Refer to restatement of comparative information note on page 73.
A.2 Dividends paid or proposed
The company’s dividend policy is, subject to board discretion, to pay a minimum of 2% of gold sales revenue as a dividend. A dividend
has not been declared for the year ended 31 December 2021.
A.3 (Loss)/earnings per share
Basic (loss)/earnings per share
(Loss)/profit attributable to ordinary equity holders for operations
of the parent for basic loss per share ($‘000)
Weighted average number of ordinary shares outstanding during the year
used in the calculation of basic EPS and diluted EPS
Basic (loss)/earnings per share from operations (cents per share)
Diluted (loss)/earnings per share from operations (cents per share)(1)
Basic loss per share – continuing operations
Loss attributable to ordinary equity holders for continuing operations
of the parent for basic loss per share ($‘000)
Weighted average number of ordinary shares outstanding during the year
used in the calculation of basic EPS
Basic loss per share from continuing operations (cents per share)
31 December 2021
31 December 2020
(319,203)
15,941
1,103,896,747
981,553,095
cents
(28.92)
(28.92)
cents
1.62
1.62
(319,203)
(25,534)
1,103,896,747
981,553,095
cents
(28.92)
cents
(2.60)
Diluted loss per share from continuing operations (cents per share)(2)
(28.92)
(2.60)
(1)
Potentially dilutive instruments have not been included in the calculation of diluted earnings per share for 31 December 2021 because the result for the year was a loss.
For 31 December 2020, the performance rights outstanding are not dilutive as performance conditions were not met at 31 December 2020.
(2) Potentially dilutive instruments have not been included in the calculation of diluted earnings per share for continuing operations for 31 December 2021 because the result for
the year was a loss.
82
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
A.3 (Loss)/earnings per share (continued)
Measurement
Basic earnings per share (“EPS”) is calculated as net (loss)/profit attributable to members, adjusted to exclude preference share
dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element.
Diluted EPS is calculated as the net (loss)/profit attributable to members, adjusted for:
• The after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised
as expenses
• other non-discretionary changes in revenues or expenses during the year that would result from the dilution of potential
ordinary shares
• divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.
Information on the classification of securities file
Options and performance rights granted to employees (including Key Management Personnel) as described in E.10 are considered to
be potential ordinary shares and have been included in the determination of diluted earnings per share to the extent they are dilutive.
These options and performance rights have not been included in the determination of basic loss per share.
A.4 Taxes
$’000
a) Income tax expense/(benefit)
Current tax expense
Deferred tax expense/(benefit)
Total tax expense
b) Numerical reconciliation of income tax expense/(benefit)
to prima facie tax expense/(benefit)
Loss before income tax benefit from continuing operations
Profit before income tax benefit from discontinued operations
Total accounting profit/(loss)
Prima facie income tax expense/(benefit) at 30% (31 December 2020: 30%)
Add/(deduct):
- net movement in temporary differences and tax losses not recognised
- effect of different rates of tax on overseas income
- effect of share based payments expense not deductible
- prior year tax losses recognised
- other permanent differences
Income tax expense attributable to net profit/(loss)
c) Tax losses (tax effected)
Revenue losses
- Australia
- Mali
- Ghana
Capital losses
- Australia
Total tax losses
Total tax losses – recognised (Australia)
Total tax losses – recognised (Mali)
31 December 2021
31 December 2020
37,613
2,069
39,682
(327,789)
-
(327,789)
(98,337)
98,104
(8,477)
337
(1,801)
49,856
39,682
1,056
70,067
-
71,123
50,581
121,704
-
-
12,681
17,364
30,045
(6,435)
41,475
35,040
10,512
9,035
3,599
521
-
6,378
30,045
12,209
46,721
434
59,364
39,037
98,401
-
(10,081)
Total tax losses not used against deferred tax liabilities for which no deferred tax
asset has been recognised (potential tax benefit at the prevailing tax rates of the
respective jurisdictions) (tax effected)
121,704
88,320
83
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
A.4 Taxes (continued)
$’000
d) Movements in the deferred tax assets balance
Balance at the beginning of the year
(Utilised)/recognised during the period
Foreign currency translation
Balance as at the end of the year
The deferred tax assets balance comprises temporary differences attributable to:
Receivables
Financial assets at fair value through other comprehensive income
Mineral exploration and development interests
Investments in associates
Property, plant and equipment
Provisions
Business related costs
Carried forward tax losses – recognised (Mali)
Temporary differences not recognised
Set off of deferred tax liabilities pursuant to set off provisions
Net deferred tax assets
e) Movements in the deferred tax liabilities balance
The deferred tax liabilities balance comprises temporary differences attributable to:
Receivables
Inventories
Mineral exploration and development interests
Payables
Provision
Total
Set off of deferred tax assets pursuant to set off provisions
Net deferred tax liabilities
f) The equity balance comprises temporary differences attributable to:
Convertible notes equity reserve
Option equity reserve
Unrealised loss reserve
Net temporary differences in equity
Set off of deferred tax liabilities pursuant to set off provisions
Total temporary differences in equity
FRANKING CREDITS
31 December 2021
31 December 2020
10,081
(9,900)
(181)
-
94,945
9,604
118,679
3,057
29,667
10,003
1,71 0
-
(248,853)
(18,812)
-
4,527
7,874
5,706
1,816
480
20,403
(18,812)
1,591
141
1,863
46
2,050
(46)
2,004
19,486
(10,093)
688
10,081
81,696
3,867
86,778
2,671
14,464
4,060
239
10,081
(170,173)
(23,602)
10,081
9,021
5,744
15,800
1,927
532
33,024
(23,602)
9,422
149
1,977
49
2,175
(49)
2,126
The amount of franking credits available for subsequent financial years is as follows.
The amount has been determined using a tax rate of 30%.
78
83
84
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
A.4 Taxes (continued)
Recognition and measurement
The income tax expense or revenue for the year is the tax
payable on the current year’s taxable income based on the
national income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to
temporary differences between the tax bases of assets and
liabilities and their carrying amounts in the financial statements,
and by unused tax losses (if appropriate).
Deferred tax liabilities are recognised for all taxable temporary
differences. Deferred tax assets are recognised for deductible
temporary differences, unused tax losses and unused tax credits
only if it is probable that sufficient future taxable income will be
available to utilise those temporary differences and losses.
Deferred tax is not recognised if the temporary difference arises
from goodwill or from the initial recognition (other than in a
business combination) of assets and liabilities in a transaction
that affects neither taxable profit or loss; or the accounting profit
or loss arising from taxable differences related to investment
in subsidiaries, associates and interests in joint ventures to the
extent that:
• the Group is able to control the reversal of the temporary
difference
• the temporary difference is not expected to reverse in the
foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply in the year in which the liability is
settled or the asset is realised, based on tax rates (and tax laws)
that have been enacted or substantially enacted by the end of
the reporting year. Deferred tax assets and liabilities are offset
only if certain criteria are met. Income taxes relating to items
recognised directly in equity are recognised in equity.
Tax consolidation
Resolute and its wholly-owned Australian controlled entities
implemented the tax consolidation legislation as of 1 July 2002
and the entities in the tax consolidated group entered into a tax
sharing agreement, which limits the joint and several liability of
the wholly-owned entities in the case of a default by the head
entity, Resolute Mining Limited. The entities have also entered
into a tax funding agreement under which the wholly-owned
entities fully compensate Resolute Mining Limited for any
current tax payable assumed and are compensated by Resolute
Mining Limited for any current tax receivable.
Key estimates and judgements
The Group records its best estimate of these items based
upon the latest information available and management’s
interpretation of enacted tax laws. Whilst the Group believes
it has adequately provided for the outcome of these matters,
future results may include favourable or unfavourable
adjustments as assessments are made, or resolved.
The recognition basis of deductible temporary differences
and unused tax losses in the form of deferred tax assets
is reviewed at the end of each reporting year and de-
recognised to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part
of the asset to be recovered.
The Senegal Ministry of Mines has recently advised that
it had not granted the expected extension of the tax
exoneration period from 5 years to 7 years (“Exoneration
Extension”). Resolute is disputing this position and is firmly
of the view that it has satisfied all relevant grounds for the
Exoneration Extension to be granted, specifically the two
year extension to the mine life.
Resolute is working with the Senegalese authorities to
resolve this matter and has received confirmation from
the Minister of Mines advising that he will review the
Exoneration Extension. Notwithstanding this, as required
under the relevant accounting standards, Resolute has
recognised an expense of $3.4 million for income tax and
derecognised a tax liability of $7.8 million for deferred income
tax to reflect the shortened tax exoneration period.
There are no deferred income tax asset recognised at 31
December 2021 in relation to carried forward Mali tax losses.
The future benefit will only be obtained if:
(i)
future assessable income is derived of a nature and
an amount sufficient to enable the benefit to be
realised
(ii)
the conditions for deductibility imposed by tax
legislation have been continued to be complied with
(iii) no changes in tax legislation adversely affect the
consolidated entity in realising the benefit.
85
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
B: Production and Growth Assets
IN THIS SECTION
Included in this section is relevant information about recognition, measurement, depreciation, amortisation and impairment
considerations of the core producing and growth (exploration and evaluation) assets of Resolute.
B.1 Mine properties and property,
plant and equipment
Key estimates and judgements
Recognition and measurement
Stripping activity asset
The Group incurs waste removal costs (stripping costs) in the
creation of improved access and mining flexibility in relation
to ore to be mined in the future. The costs are capitalised as a
stripping activity asset, where certain criteria are met. Once the
Group has identified its production stripping for each surface
mining operation, it identifies the separate components for
the orebodies in each of its mining operations. An identifiable
component is a specific volume of the ore body that is made
more accessible by the stripping activity. The costs of each
component are amortised on a units of production basis in
applying a stripping ratio.
Development expenditure
a) Areas in Development: Costs incurred in preparing mines
for production including required plant infrastructure.
b) Areas in Production: Represent the accumulation of all
acquired exploration, evaluation and development
expenditure in which economic mining of an Ore Reserve
has commenced. Amortisation of costs is provided on the
unit of production method.
Property, plant and equipment
Property, plant and equipment are stated at cost less
any accumulated depreciation and any impairment losses.
The cost of an item of property, plant and equipment comprises:
• Its purchase price, including import duties and
non-refundable purchase taxes, after deducting trade
discounts and rebates
• Any costs directly attributable to bringing the asset to the
location and condition necessary for it to be capable of
operating in the manner intended by management
• The initial estimate of the costs of dismantling and
removing the item and restoring the site on which it
is located.
Depreciation is provided on the following basis:
Life
Method
Stripping activity assets
Judgement is required to identify a suitable production
measure to be used to allocate production stripping costs
between inventory and any stripping activity asset(s) for
each component. The Group considers that the ratio of the
expected volume of waste to be stripped for an expected
volume of ore to be mined for a specific component of the
orebody, to be the most suitable production measure.
An identifiable component is a specific volume of the ore
body that is made more accessible by the stripping activity.
Judgement is also required to identify and define these
components, and also to determine the expected volumes
(e.g. tonnes) of waste to be stripped and ore to be mined in
each of these components. These assessments are based
on the information available in the mine plan which will
vary between mines for a number of reasons, including, the
geological characteristics of the ore body, the geographical
location and/or financial considerations.
Stripping ratio
The Group has adopted a policy of capitalising production
stage stripping costs and amortising them on a units of
production basis. Significant judgement is required in
determining the contained ore units for each mine.
Factors that are considered include:
• any proposed changes in the design of the mine
• estimates of the quantities of ore reserves and mineral
resources for which there is a high degree of confidence
of economic extraction
•
•
•
future production levels
future commodity prices
future cash costs of production and capital expenditure.
Determining the beginning of production
The Group ceases capitalising pre-production costs and
begins depreciation and amortisation of mine property
assets at the point commercial production commences.
This is based on the specific circumstances of the project,
and considers when the specific asset becomes ‘available
for use’ as intended by management which includes
consideration of the following factors:
Motor vehicles
3-5 years
Straight line
• completion of a reasonable period of testing of the mine
Office equipment
3 years
Straight line
Plant and equipment
Life of mine years
or 2-6 years
Straight line over
life of mine years
or straight line
Processing plant
Life of mine
production
Units of
production
plant and equipment
• mineral recoveries, availability and throughput levels at
or near expected/feasibility study levels
• the ability to produce gold into a saleable form (where
more than an insignificant amount is produced)
• the achievement of continuous production
• Estimation of mineral reserves and resources – refer
to B.3.
86
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
B.1 Mine properties and property, plant and equipment (continued)
31 December 2021
$’000
Plant and Equipment
Development Expenditure
s
g
n
d
i
l
i
u
B
t
n
e
m
p
u
q
E
i
d
n
a
t
n
a
P
l
s
e
l
c
i
h
e
V
r
o
t
o
M
t
n
e
m
p
u
q
E
i
e
c
i
ff
O
d
e
s
a
e
L
s
t
e
s
s
A
l
a
t
o
T
s
e
i
t
r
e
p
o
r
P
e
n
M
i
i
g
n
p
i
r
t
S
y
t
i
v
i
t
c
A
t
e
s
s
A
l
a
t
o
T
Opening written down value
7,797
276,798
2,558
5,525
Additions
30
33,463
231
4,149
3,314
(7,596)
2,642
(3,073)
-
(12)
(482)
(66)
510
719
241
-
Transfers (to)/from areas in
exploration and development
Reallocations
Disposals
Impairment recognised
in the current year
(2,862)
(44,550)
(993)
(236)
Depreciation expense
(905)
(32,348)
(1,431)
(2,648)
Amounts amortised to costs of
production relating to gold sales
Amortisation expense
Adjustments to rehabilitation
and restoration obligations
-
-
-
-
-
-
-
-
-
-
-
-
Foreign currency translation
(887)
(10,257)
(139)
(328)
At 31 December net of
accumulated depreciation
Cost
Accumulated depreciation
and impairment
10,636
212,425
2,320
3,783
27,026
503,172
14,243
18,241
(16,390)
(290,747)
(11,923)
(14,458)
Assets held for sale
-
-
-
-
Net carrying amount
10,636
212,425
2,320
3,783
31 December 2020
$’000
292,678
488,709
6,572
495,281
34,234
11,324
17,780
29,104
(86)
(1,397)
-
(78)
-
(11)
-
-
-
(1,397)
-
(11)
(48,641)
(169,802)
(836)
(170,638)
-
-
-
-
(3,040)
(3,040)
(69,981)
(2,723)
(72,704)
(37,332)
-
-
-
6,129
(11,611)
(18,257)
-
24
6,129
(18,233)
229,164
246,714
17,777
264,491
562,682
778,691
24,783
803,474
(333,518)
(531,977)
(7,006)
(538,983)
-
-
-
-
229,164
246,714
17,777
264,491
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Opening written down value
6,478
296,289
3,483
3,475
34
309,759
535,829
-
535,829
Additions
327
35,940
115
375
36,757
21,679
7,510
29,189
Transfers (to)/from areas in
exploration and development
Disposals
4,793
(10,536)
-
(109)
(64)
(36)
4,688
(1,119)
1,431
(15)
(34)
(194)
Depreciation expense
(441)
(45,341)
(924)
(2,078)
Amounts amortised to costs of
production relating to gold sales
Amortisation expense
Adjustments to rehabilitation
and restoration obligations
-
-
-
-
-
-
-
-
-
-
-
-
Assets held for sale
(3,942)
(16,851)
(212)
(1,356)
Foreign currency translation
582
17,406
196
436
-
-
-
-
-
-
-
-
-
(109,152)
11,166
-
(48,784)
-
-
-
(22,361)
-
-
-
1,431
-
-
(984)
(984)
-
-
-
(109,152)
11,166
-
18,620
27,756
46
27,802
At 31 December net of
accumulated depreciation
7,797 276,798
2,558
5,525
-
292,678
488,709
6,572
495,281
Cost
15,330
585,851
6,743
14,884
(3,592) (292,202)
(3,972)
(8,003)
(3,941)
(16,851)
(213)
(1,356)
-
-
-
622,808
820,270
7,574
827,844
(307,769)
(331,561)
(1,002)
(332,563)
(22,361)
-
-
-
Accumulated depreciation
and impairment
Assets held for sale
Net carrying amount
7,797 276,798
2,558
5,525
- 292,678 488,709
6,572
495,281
87
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
B.2 Exploration and evaluation assets
Exploration and evaluation (at cost)
Balance at the beginning of the year
Disposal of subsidiary
Evaluation expenditure during the year
Transfers (to)/from areas in exploration and development
Adjustments to rehabilitation obligations
Impaired during the year
Write-off during the year
Asset held for sale
Foreign currency translation
Balance at the end of the year
31 December 2021
$’000
31 December 2020
$’000
6,469
(726)
536
1,483
-
(5,068)
(1,157)
-
1,372
2,909
57,798
-
5,699
(1,431)
334
(2,836)
-
(53,329)
234
6,469
Recognition and measurement
Exploration expenditure is expensed to the consolidated statement of comprehensive income as and when it is incurred and included
as part of cash flows from operating activities. Exploration costs are only capitalised to the consolidated statement of financial
position if they result from an acquisition.
Evaluation expenditure is capitalised to the consolidated statement of financial position. Evaluation is deemed to be activities
undertaken from the beginning of the pre-feasibility study conducted to assess the technical and commercial viability of extracting
a mineral resource before moving into the Development phase. The criteria for carrying forward the costs are:
•
•
Such costs are expected to be recouped through successful development and exploitation of the area of interest, or alternatively
by its sale
Evaluation activities in the area of interest which has not yet reached a state which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area
are continuing.
Costs carried forward in respect of an area of interest which is abandoned are written off in the year in which the abandonment
decision is made. Resolute sold Cote d’Ivoire exploration interest and recognised an impairment loss. Refer to Note E.1.
Exploration commitments
It is difficult to accurately forecast the nature or amount of future expenditure, although it is necessary to incur expenditure in
order to retain present interests in mineral tenements. Expenditure commitments on mineral tenure can be reduced by selective
relinquishment of exploration tenure or by the renegotiation of expenditure commitments. The level of exploration and evaluation
expenditure expected in the 12 months ending 31 December 2022 for the consolidated entity is approximately $15.5 million (actual
expenditure for the year ended 31 December 2021: $17.1 million). This includes the minimum amounts required to retain tenure.
There are no material exploration commitments further out than one year.
B.3 Impairment of non current assets
Recognition and measurement
Impairment testing
In accordance with the Group’s accounting policies, each asset or cash-generating unit (CGU) is evaluated to determine whether there
are any indications of impairment. If any such indications of impairment exist, a formal estimate of the recoverable amount is performed.
In assessing whether an impairment is required, the carrying value of the asset or CGU is compared with its recoverable amount. The
recoverable amount is the higher of the CGU’s fair value less costs of disposal (FVLCD) and value in use (VIU). Recoverable amount has
been determined based on FVLCD. Given the nature of the Group’s activities, information on the fair value of an asset is usually difficult
to obtain unless negotiations with potential purchasers or similar transactions are taking place. Consequently, the FVLCD for each CGU
is estimated based on discounted future estimated cash flows (expressed in real terms) expected to be generated from the continued
use of the CGUs using market-based gold price assumptions, the level of proved and probable reserves and measured, indicated
and inferred mineral resources, estimated quantities of recoverable gold, production levels, operating costs and capital requirements,
including any expansion projects, and its eventual disposal, based on the CGU latest life of mine (LOM) plans. These cash flows are
discounted using a real post-tax discount rate that reflects current market assessments of the time value of money and the risks specific
to the CGU. When LOM plans do not fully utilise existing mineral properties for a CGU, and options exist for the future extraction and
processing of all or part of those resources, an estimate of the value of mineral properties is included in the determination of fair value.
The determination of FVLCD for each CGU are considered to be Level 3 fair value measurements, as they are derived from valuation
techniques that include inputs that are not based on observable market data. The Group considers the inputs and the valuation
approach to be consistent with the approach taken by market participants.
88
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
B.3 Impairment of non current assets (continued)
Syama CGU – 30 June 2021
Syama indicator assessment
At 30 June 2021, Resolute’s quoted market capitalisation was lower than its net asset carrying value. In addition, there was a reduction
in gold prices, an increase in the risk free rate underpinning the applicable discount rate and a revision to FY21 production and cost
guidance. These factors were considered as indicators of impairment. As a result, an impairment test was performed to determine the
recoverable amount for the Syama Gold Mine.
Key Assumptions used to determine recoverable amount
The table below summarises the key assumptions used in the carrying value assessment:
Gold price ($/oz)
Discount rate (post tax real)
Unmined resources ($/oz)
30 June 2021
1,798-1,465
13%
$20-$54
Gold prices
Gold prices are estimated with reference to external market forecasts based on a consensus view of market experts.
Discount rate
In determining the recoverable amount of assets, the future cash flows were discounted using rates based on the CGU’s estimated
real weighted average cost of capital, with an additional premium applied having regard to the CGU’s risk profile.
Unmined resources
Unmined resources which are not included in the life‐of‐mine plan as result of the current assessment of economic returns, timing of
specific production alternatives and the prevailing economic environment have been valued and included in the assessed fair value.
Operating and capital costs
Life‐of‐mine operating and capital cost assumptions are based on the Group’s latest budget and life‐of mine plans. Operating cost
assumptions reflect an assumption of maintaining current cost, over the long term, without including expected improvements over
the life of mine.
Recognition
As a result of the analysis performed by Management, an impairment loss of $167.373 million was recognised at 30 June 2021 allocated
to the Syama CGU, as summarised in the table below:
Mine Properties
Property, plant and equipment
Right of use
Total Syama impairment
$’000
133,262
31,562
2,549
167,373
89
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
B.3 Impairment of non current assets (continued)
Syama CGU – 31 December 2021
Syama indicator assessment
Similar to 30 June 2021, Resolute’s quoted market capitalisation was lower than its net asset carrying value as at 31 December 2021.
Whilst the revised production and cost guidance were met, as noted above, the guidance were revised in July 2021. These factors
collectively were considered to be indicators of impairment and as such a formal impairment test was performed to determine the
recoverable amount for the Syama CGU at 31 December 2021.
Key Assumptions
The table below summarises the key assumptions used in the carrying value assessment:
Gold price ($/oz)
Discount rate (post tax real)
Unmined resources ($/oz)
31 December 2021
1,777-1,467
14.0%
$20-$54
Gold prices
Gold prices are estimated with reference to external market forecasts based on a consensus view of market experts.
Discount rate
In determining the recoverable amount of assets, the future cash flows were discounted using rates based on the CGU’s estimated
real weighted average cost of capital, with an additional premium applied having regard to the CGU’s risk profile.
Unmined resources
Unmined resources which are not included in the life‐of‐mine plan as result of the current assessment of economic returns, timing of
specific production alternatives and the prevailing economic environment have been valued and included in the assessed fair value.
Operating and capital costs
Life‐of‐mine operating and capital cost assumptions are based on the Group’s latest budget and life‐of mine plans. Operating cost
assumptions reflect an assumption of maintaining current cost, over the long term, without including expected improvements over
the life of mine.
Based on the impairment test performed at 31 December 2021, it was concluded that no further impairment loss adjustment was
required at 31 December 2021.
Syama Sensitivity Analysis
It is estimated that changes in key assumptions underpinning the recoverable amount, in isolation, would have had the
following approximate impact (increase or decrease) on the impairment loss recognised for the Syama CGU for the year
ended 31 December 2021.
10% change in gold price ($ per oz)
1% change in discount rate
10% change in value of unmined resources
10% change in operating cost
Increase in key assumption
$‘000
Decrease in key assumption
$’000
144,221
(7,571)
25,857
(84,557)
(147,088)
8,064
(25,857)
83,127
Mako CGU – 30 June 2021
Mako indicator assessment
At 30 June 2021, Resolute’s quoted market capitalisation was lower than its net asset carrying value. Further, Resolute noted that
there was a reduction in gold prices, an increase in the risk free rate that underpins the applicable discount rate. These factors were
considered as indicators of impairment. As a result, an impairment test was performed to determine the recoverable amount for the
Mako Gold Mine at 30 June 2021.
Based on the impairment test performed, it was concluded that no impairment adjustment was required at 30 June 2021.
90
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
B.3 Impairment of non current assets (continued)
Mako CGU – 31 December 2021
Mako indicator assessment
Resolute’s quoted market capitalisation being lower than its net asset carrying value as at 31 December 2021 and the reduction in the
tax exoneration period to 5 years (refer to Note A4) are considered as indicators of impairment. As a result, an impairment test was
performed to determine the recoverable amount for the Mako Gold Mine at 31 December 2021.
Key Assumptions
The table below summarises the key assumptions used in the carrying value assessment:
Gold price ($/oz)
Discount rate (post tax real)
Unmined resources ($/oz)
31 December 2021
1,777-1,467
10.5%
$44
Gold prices
Gold prices are estimated with reference to external market forecasts based on a consensus view of market experts.
Discount rate
In determining the recoverable amount of assets, the future cash flows were discounted using rates based on the CGU’s estimated
real weighted average cost of capital, with an additional premium applied having regard to the CGU’s risk profile.
Unmined resources
Unmined resources which are not included in a CGU’s life‐of‐mine plan as result of the current assessment of economic returns,
timing of specific production alternatives and the prevailing economic environment have been valued and included in the assessed
fair value.
Operating and capital costs
Life‐of‐mine operating and capital cost assumptions are based on the Group’s latest budget and life‐of mine plans. Operating cost
assumptions reflect the expectation that costs will, over the long term, have a degree of positive correlation to the prevailing gold price
rate assumptions.
Recognition
As a result of the analysis performed by management, an impairment loss of $55.024 million has been recognised at 31 December 2021
and allocated to the Mako CGU, as summarised in the table below:
Mine properties
Property, plant and equipment
Right of use
Total Mako impairment
$’000
37,376
17,079
569
55,024
Mako Sensitivity Analysis
It is estimated that changes in key assumptions underpinning the recoverable amount, in isolation, would have the following
approximate impact (increase or decrease) on the recoverable amount of the Mako CGU as at 31 December 2021 and impairment
loss recognised for the Mako CGU for the year ended 31 December 2021.
10% change in gold price ($ per oz)
1% change in discount rate
10% change in value of unmined resources
10% change in operating cost
Increase in key assumption
$‘000
Decrease in key assumption
$’000
66,700
(3,449)
7 1 7
(38,394)
(64,830)
3,737
(717)
38,979
91
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
Key estimates and judgements
Determination of Mineral Resources and Ore Reserves
The determination of Ore Reserves impacts the accounting
for asset carrying values, depreciation and amortisation rates,
deferred stripping costs and provisions for decommissioning
and restoration.
The information in this report as it relates to ore reserves,
mineral resources or mineralisation is reported in accordance
with the Aus.IMM “Australian Code for reporting of Identified
Mineral Resources and Ore Reserves”. The information
has been prepared by, or under supervision of, competent
persons as identified by the Code.
There are numerous uncertainties inherent in estimating
mineral resources and ore reserves and assumptions that are
valid at the time of estimation which may change significantly
when new information becomes available.
Changes in the forecast prices of commodities, exchange
rates, production costs or recovery rates may change the
economic status of reserves and may, ultimately, result in the
reserves being restated.
The future recoverability of capitalised mine properties and
plant and equipment is dependent on a number of key factors
including: gold price assumptions, the level of proved and
probable reserves and measured, indicated and inferred
mineral resources, estimated quantities of recoverable gold,
production levels, operating costs and capital requirements,
including any expansion projects, and its eventual disposal,
based on the CGU latest life of mine (LOM) plans. The costs
to dispose are estimated by management based on prevailing
market conditions.
When applicable, fair value is estimated based on discounted
cash flows using gold price assumptions, the level of proved
and probable reserves and measured, indicated and inferred
mineral resources, estimated quantities of recoverable gold,
production levels, operating costs and capital requirements,
including any expansion projects, and its eventual disposal,
based on the CGU latest life of mine (LOM) plans.
Consideration is also given to analysts’ valuations, and
the market value of the Company’s securities. The fair
value methodology adopted is categorised as Level 3 in
the fair value hierarchy (in accordance with Australian
Accounting Standards).
B.4 Segment expenditure, assets, and liabilities
31 December 2021
Capital expenditure
Segment assets of continuing operations
Segment liabilities of continuing operations
31 December 2020
Capital expenditure
Segment assets of continuing operations
Segment liabilities of continuing operations
Mako
(Senegal)
$’000
15,043
263,371
85,427
Mako
(Senegal)
$’000
10,802
347,272
69,455
Syama
(Mali)
$’000
43,957
591,794
225,640
Syama
(Mali)
$’000
55,577
812,967
222,634
Corp/
Other
$‘000
1,463
129,036
247,574
Corp/
Other
$‘000
5,266
184,109
308,941
Total
$’000
60,463
984,201
558,641
Total
$’000
71,645
1,344,348
601,030
92
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
C: Cash, Debt and Capital
IN THIS SECTION
Cash, debt and capital position of the Group at the end of the reporting year.
C.1 Cash
Cash at bank and on hand
Reconciliation to cash flow statement
For the purpose of the cash flow statement, cash and cash equivalents comprise the
following at the end of each year:
Cash at bank and on hand
Bank overdraft - ref C.2
Total
31 December 2021
$’000
31 December 2020
$’000
67,607
88,591
67,607
(42,370)
25,237
88,591
(33,365)
55,226
The credit quality of cash and cash equivalents can be assessed by reference to external credit ratings (if available) or to historical
information about counterparty default rates:
Cash at bank and short-term deposits
Counterparties with external credit ratings
AA-
A
A+
BB
B
Counterparties without external credit ratings
Total cash at bank and short term deposits
31 December 2021
$’000
31 December 2020
$’000
253
145
61,363
67
5,402
377
67,607
246
1,005
86,065
67
1,000
208
88,591
Recognition and measurement
Cash and cash equivalents in the statement of financial position comprise cash at bank and short-term deposits with an original
maturity of three months or less. Cash and cash equivalents are stated at face value in the statement of financial position.
Fair value and foreign exchange risk
The carrying amount of cash and cash equivalents approximates their fair value.
The Group held $67.1 million of cash and cash equivalents at 31 December 2021 (31 December 2020: $82.5 million) in currencies
other than Australian dollars or a different currency to that of the functional currency of the company which holds the item.
These exposures are predominantly US dollars (December 2021: $56.0 million; December 2020: $81.2 million equivalent) and
Euro (December 2021: $10.5 million; December 2020: $0.5 million equivalent).
93
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
C.1 Cash (continued)
Reconciliation of net profit from continuing and discontinued operations after income tax to the net operating cash flows:
31 December 2021
$’000
31 December 2020
$’000
Loss from continuing operations
Profit after tax from discontinued operations
(Loss)/profit after tax
Add/(deduct):
Share based payments including employee long term incentive costs
Unrealised loss on derivative financial liability
(Gain)/loss on remeasurement for refinancing
Unrealised foreign exchange loss on intercompany balances
Rehabilitation and restoration provision accretion
Depreciation and amortisation
Foreign exchange losses/(gains)
Share of associates’ losses
Indirect tax expense
Non cash interest income
Exploration write offs
Impairment of non current assets and assets held for sale
Changes in operating assets and liabilities:
Decrease in receivables(1)
(Increase)/decrease in inventories
Increase in prepayments
Decrease in payables
Decrease in financial derivative liabilities
Net increase/(decrease) in current tax liabilities
(Decrease)/increase in deferred tax balances
(Decrease)/increase in operating provisions(1)
Net operating cash flows
(367,471)
-
(367,471)
1,206
-
(316)
11,214
598
120,993
16,483
3,838
24,760
(5,072)
1,157
227,464
(183)
16,345
(4,083)
13,674
-
7,499
2,250
(19,798)
50,558
(36,480)
41,475
4,995
(1,530)
1,167
4,711
14,353
780
175,331
(31,488)
1,661
24,308
(1,536)
2,224
-
(29,139)
(49,363)
(3,153)
(50,378)
(12,000)
(23,899)
16,675
6,233
49,952
(1) The Group has offset approximately $56.6 million of demands against carried forward VAT receivables. Refer to Note D.5 for details.
94
Resolute Mining Limited 2021 Annual ReportFinancial Report C.2 Interest bearing liabilities
Interest bearing liabilities (current)
Bank overdraft
Insurance premium funding
Bank borrowings
Total Interest bearing liabilities (current)
Interest bearing liabilities (non current)
Bank borrowings
Total Interest bearing liabilities (non current)
Notes to the Financial Statements
for the year ended 31 December 2021
31 December 2021
$’000
31 December 2020
$’000
42,370
109
50,247
92,726
223,979
223,979
33,365
483
28,710
62,558
273,613
273,613
Total
316,705
336,171
Recognition and measurement
All loans and borrowings are initially recognised at fair value less transaction costs and subsequently at amortised cost. Any
difference between the proceeds received and the redemption amount is recognised in the income statement over the year of the
borrowings using the effective interest method.
Resolute has a Security Trust Deed in place with various banks. The total assets of the entities over which security exists amounts to
$984.2 million (as at December 2020: $1,428.7m). $229.2 million (as at December 2020: $292.7m) of these assets relate to property,
plant and equipment.
Interest bearing liabilities
The Group’s interest bearing liabilities have a fair value equal to the carrying value.
The Group held $316.7 million of interest bearing liabilities at 31 December 2021 (As at 31 December 2020: $336.2 million) in
currencies other than Australian dollars or a different currency to that of the functional currency of the company which holds the item.
The average interest rates charged on interest bearing liabilities for the year ended 31 December 2021 was 4.23% (2020: 6.50%).
The Group’s main IBOR exposure at 31 December 2021 was in relation to the Syndicate Borrowing Facility which was indexed to the
3-month US dollar LIBOR. The alternative reference rate for US dollar LIBOR is the Secured Overnight Financing Rate (SOFR). All
newly transacted floating rate financial assets and liabilities are linked to an alternative benchmark rate, such as SOFR or if, linked
to LIBOR, include detailed fallback clauses clearly referencing the alternative benchmark rate and the trigger event on which the
clause is activated.
Maturity profile of interest-bearing liabilities
The maturity profile of the Group’s interest-bearing liabilities in total and for finance leases is as follows:
Borrowings
Due within 1 to 3 months
Due within 4 months to one year
Due between one and five years
Total contractual repayments
Less future interest charges
Total interest bearing liabilities
31 December 2021
$’000
31 December 2020
$’000
62,053
39,778
228,836
330,667
(13,962)
316,705
4,466
69,751
292,887
367,104
(30,933)
336,171
95
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
C.3 Financing facilities
C3.1 Bank overdraft
The current facilities with the Bank Du Mali SA are in place and
are subject to an annual revision in March 2022. The facilities
total CFA 25.0 billion ($43.3 million) and as at 31 December 2021,
$6.6 million of the facility was undrawn. On 28 December 2021,
an overdraft facility with Orabank was opened and is subject
to an annual revision. The facility totals CFA 7.0 billion ($12.1
million) and as at 31 December 2021, $6.4 million of the facility
was undrawn.
As noted in the Basis of Preparation, Resolute is in the process
of renewing its Banque du Développement du Mali S.A. (“BDM”)
overdraft facility which expired in March 2022. Taking into
account the extensive history of renewal of this facility, Resolute
does not see any reason for the bank overdraft facility to not be
renewed. The original facility was first draw-down in 2009.
The Group has adequate liquidity should repayment of the
facility be required.
C3.2 Syndicated facilities
On 25 March 2020, Resolute entered into a $300.0 million
Syndicated Facility Agreement (the “SFA”) comprising a three-
year $150.0 million revolving credit facility (Facility A) and a
four-year $150.0 million term loan facility (Facility C) with the
participation of Investec, BNP Paribas S.A, Citibank N.A, ING
Group, Societe Generale and Nedbank Limited. In addition,
Facility B is a $5.0 million letter of credit facility which relates
mainly to lease guarantees.
As at 31 December 2021, $150.0 million of Facility A and
$125.0 million of Facility C has been drawn.
Facility A and Facility B are scheduled to mature on 27 March
2023 and Facility C is scheduled to mature on 25 March 2024.
The SFA and hedging facilities, also provided by the lenders or
their affiliates are secured and guaranteed by the following:
(i)
Cross guarantee and indemnity given by Resolute Mining
Limited, Resolute (Treasury) Pty Ltd, Resolute (Somisy)
Pty Ltd, Carpentaria Gold Pty Ltd, Resolute Treasury UK
Limited, Resolute (Finkolo) Pty Ltd, Toro Gold Limited and
Bambuk Minerals Limited
(ii)
Share Mortgage granted by Resolute Mining Limited over
all of its shares in Carpentaria Gold Pty Ltd
(iii) Specific security deed granted by Resolute Mining Limited
over all of its shares in Resolute (SOMISY) Pty Ltd
(iv) Fixed and Floating Charge granted by Resolute (Treasury)
Pty Ltd over all its current and future assets including bank
accounts and an assignment of all Hedging Contracts
(v)
Mining Mortgage and Fixed and Floating Charge granted
by Carpentaria Gold Pty Ltd over all the current and future
assets including bank accounts and an assignment of all
Hedging Contracts
(vi) Mortgage of Contractual Rights granted by Resolute
Mining Limited over a loan provided to Société des Mines
de Syama SA to fund the development of the Syama Gold
project in Mali
(vii) Security Agreement granted by Resolute Treasury UK
Limited over all current and future assets including bank
accounts and assignment of all Hedging contracts
(viii) Specific Security Deed granted by Resolute Mining Limited
over all its share in Resolute (Finkolo) Pty Ltd and a
featherweight security over its assets not secured under a
Security Document
(ix) Share Pledge Agreement granted by Toro Gold Limited
over all its share in Bambuk Minerals Limited.
Pursuant to the Syndicated Facility Agreement, the following
ratios are required:
(i)
(ii)
Interest Cover Ratio: the ratio of EBITDA to Net Interest
Expense will be greater than 5.00 times
Net Debt to EBITDA: the ratio of Net Debt to EBITDA will
be less than 2.50 times
(iii) Consolidated Gearing: the ratio of Net Debt to Equity will
be less than 1.00 times
(iv) Reserve Tail Ratio: will exceed 30%
(v)
Project Life Coverage Ratio: will be equal to or greater
than 1.50:1
(vi) Tangible Net Worth: will be equal to or greater than
A$500,000,000.
There have been no breaches of these ratios.
Under the SFA the group has a minimum liquidity requirement
of $35.0 million cash and bullion balance.
On 28 March 2022, the Group successfully extended the
Revolving Credit Facility. Details of the revised repayment terms
of the RCF are as follows:
•
$30.0 million in August 2022 upon receipt of the third tranche
of the Bibiani sale consideration*
• $20.0 million in January 2023
•
$20.0 million in March 2023 in line with the original RCF
maturity date
• the final $80.0 million in March 2024.
*The $30.0 million August 2022 payment is only payable if
Resolute receives the third payment instalment under the sale
agreement between it and Asante Gold Corporation in respect
of the sale of the Bibiani Gold Mine. Should this not be received,
the Group will instead be required to make three $10.0 million
repayment instalments in June 2023, September 2023 and
December 2023.
The interest rate under the SFA has also been amended so that
reference to the Screen Rate for Facility A (currently, LIBOR) is
changed to Secured Overnight Financing Rate (“SOFR”).
There are no changes to the repayment schedule of the $150
million Term Loan Facility, with amortisation remaining in line
with the previous biannual repayment schedule (each March
and September).
96
Resolute Mining Limited 2021 Annual ReportFinancial Report
C.4 Contributed Equity
Ordinary share capital:
Notes to the Financial Statements
for the year ended 31 December 2021
31 December 2021
$’000
31 December 2020
$’000
1,103,931,520 ordinary fully paid shares (2020: 1,103,892,706)
777,021
777,021
Movements in contributed equity, net of issuing costs:
Balance at the beginning of the year
Placement of shares to institutional investors
Share issue costs
Balance at the end of the year
777,021
-
-
777,021
639,859
137,428
(266)
777,021
Recognition and measurement
Issued and paid up capital is recognised at the fair value of the consideration received by the Company. Incremental costs directly
attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Terms and conditions of contributed equity
Ordinary shares have the right to receive dividends as declared and in the event of winding up the Company, to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares
entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
Rights of employee share-based payment recipients
Refer to E.10 for details of the employee share-based payment plans which includes option and performance rights plans. Each option
entitles the holder to purchase one share. The names of all persons who currently hold employee share options or performance rights,
granted at any time, are entered into the register kept by the Company, pursuant to Section 215 of the Corporations Act 2001 (Cth.).
Persons entitled to exercise these options and holders of performance rights have no right, by virtue of the options, to participate in
any share issue by the parent entity or any other body corporate.
97
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
C.5 Other reserves
Reserve
Nature and purpose
Net unrealised gain/(loss) reserve
Convertible notes/Share options
equity reserve
Employee benefits equity reserve
This reserve records fair value changes on financial assets at fair value through other
comprehensive income.
This reserve records the value of the equity portion (conversion rights) of the convertible
notes and records the fair value of share options issued
This reserve is used to recognise the fair value of options and performance rights granted
over the vesting year of the securities provided to employees.
Foreign currency translation reserve
Represents exchange differences arising on translation of foreign controlled entities.
Non-controlling interests’ reserve
This reserve records the difference between the fair value of the amount by which the
non-controlling interests were adjusted to record their initial relative interest and the
consideration paid for Resolute’s acquisition for that share of the interest.
Key financial and capital risks associated with Cash, Debt and Capital
Liquidity risk management
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities or having the availability of funding
through an adequate amount of undrawn committed credit facilities.
Interest rate risk management
Borrowings issued at variable rates expose the Group to cash flow interest rate risk. The Group constantly analyses its interest
rate exposure. Within this analysis consideration is given to the potential renewals of existing positions, alternative financing,
alternative hedging positions and the mix of fixed and variable interest rates. There is no intention at this stage to enter into any
interest rate swaps.
Capital risk management
The Group’s and the parent entity’s objectives when managing capital are to safeguard their ability to continue as a going concern,
so that they can continue to provide returns for shareholders and benefits for other stakeholders and to maintain a capital structure
that is appropriate for the Group’s current and/or projected financial position. In order to maintain or adjust the capital structure, the
Group may adjust the amount of dividends paid to shareholders (if any), returns of capital to shareholders, buybacks of its shares, the
issue of new shares, the level of borrowing from financiers or the sale of assets to reduce debt.
The Group monitors the adequacy of capital by analysing cash flow forecasts over the term of the Life of Mine for each of its
projects. To a lesser extent, gearing ratios are also used to monitor capital. Appropriate capital levels are maintained to ensure that all
approved expenditure programs are adequately funded. This funding is derived from an appropriate combination of debt and equity.
The gearing ratio at 31 December 2021 is 50% (31 December 2020: 29%). The Group is not subject to any externally imposed capital
management requirements.
The gearing ratio is calculated as net debt divided by total capital. Net debt is defined as interest bearing liabilities less cash, cash
equivalents and market value of bullion on hand. Total capital is calculated as ‘equity’ as shown in the Consolidated Statement
of Financial Position (including non‐controlling interest) plus net debt. The following table summarises the post-tax effect of the
sensitivity of the Group’s cash and debt items on profit and equity at reporting date to movements that are reasonably possible in
relation to interest rate risk and foreign exchange currency risk.
Interest rate risk(1)
Foreign exchange risk(2)
-0.25%
+0.25%
-10%
+10%
Carrying
Amount
$’000
Profit
$’000
Equity
$’000
Profit
$’000
Equity
$’000
Profit
$’000
Equity
$‘000
Profit
$’000
Equity
$‘000
31 December 2021
Cash
67,607
Interest bearing liabilities
316,705
Total (decrease)/increase
31 December 2020
Cash
88,591
Interest bearing liabilities
336,171
Total (decrease)/increase
(122)
(479)
(601)
(150)
(522)
(672)
(122)
(479)
(601)
(150)
(522)
(672)
122
479
601
150
522
672
122
479
601
150
522
672
5,218
5,218
(5,218)
(5,218)
21,389
21,389
(21,389)
(21,389)
26,607
26,607
(26,607)
(26,607)
6,414
6,414
(6,414)
(6,414)
23,605
23,605
(23,605)
(23,605)
30,019
30,019
(30,019)
(30,019)
(1) The above analysis principally relates to the risks associated with movements in the 3-month US Dollar London Interbank Offered Rate.
(2) The above analysis principally relates to the risks associated with movements in the Australian dollar against the US dollar.
98
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
D: Other assets and liabilities
IN THIS SECTION
Other assets and liabilities position at the end of the reporting year.
D.1 Receivables
Trade and other receivables
Taxation receivables(¹)
Total receivables
31 December 2021
$’000
31 December 2020
$’000
441
27,371
27,812
258
78,594
78,852
(1) The taxation receivables primarily relate to indirect taxes owing to the group by the State of Mali. Refer to Note D.5.
During the year Resolute’s subsidiary SOMISY, has received a letter from the Mali Tax Authorities notifying the company that they
have offset VAT credits against previously recognised provision for the tax years ended 31 December 2015 to 2020 amounting to
$56.6 million. As at 31 December 2021 this notification of offset has been reflected in the above amounts in line with the requirements
of the accounting standards. Resolute continues to work with its legal and tax advisors to contest the position taken by the
Authorities. Additionally, at 31 December 2021, Resolute has recognised $10.1 million of VAT assets for the Mako operations due
to the reduction in the tax exoneration period to 5 years. Refer to Note D.5.
The credit quality of receivables can be assessed by reference to external credit ratings (if available) or to historical information about
counterparty default rates:
Counterparties with external credit ratings
AA+
Counterparties without external credit ratings(*)
Group 1
Group 2
Total receivables
31 December 2021
$’000
31 December 2020
$’000
37
270
10,144
17,631
27,812
-
78,582
78,852
(*) Group 1 refers to existing counterparties with no defaults in the past. Group 2 refers to existing counterparties where difficulty in recovering these debts in the past has
been experienced.
Recognition and measurement
Trade receivables are initially recognised at fair value and subsequently at amortised cost less a provision for any expected credit
losses. Trade receivables are due for settlement no more than 30 days from the date of recognition.
Taxation receivables are considered statutory in nature and therefore not accounted for as financial assets under AASB 9. Taxation
receivables are initially recognised and subsequently measured at amortised cost.
Fair value and foreign exchange risk
The carrying amount of receivables determines their approximate fair value. The Group always recognises the lifetime expected credit
loss for trade receivables carried at amortised cost. The expected credit losses on these financial assets are estimated based on
the Group’s historic credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions and an
assessment of both the current as well as forecast conditions at the reporting date.
For all other receivables measured at amortised cost, the Group recognises lifetime expected credit losses when there has been a
significant increase in credit risk since initial recognition. If the credit risk on the financial instrument has not increased significantly
since initial recognition, the Group measures the loss allowance for the financial instrument at an amount equal to expected credit
losses within the next 12 months.
99
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
D.2 Inventories
Current
Ore stockpiles
- At cost
- At net realisable value
Total current ore stockpiles
Gold in circuit - at cost
Gold in circuit - at net realisable value
Gold bullion on hand - at cost
Gold bullion on hand - at net realisable value
Consumables at cost
Total inventory (current)
Non Current
Ore stockpiles - at cost
Ore stockpiles - at net realisable value
Gold in circuit - at net realisable value
Total inventory (non current)
31 December 2021
$’000
31 December 2020
$’000
47,054
6, 381
53,435
22,353
1,503
15,697
1,722
61,879
156,589
1,935
6,559
45,424
53,918
71,082
4,237
75,319
23,038
2,745
9,887
-
47,940
158,929
2,803
26,695
38,425
67,923
Recognition and measurement
Finished goods (bullion), gold in circuit and stockpiles of unprocessed ore are stated at the lower of cost and estimated net realisable
value. Cost comprises of direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure,
the latter being allocated on the basis of normal operating capacity. Costs are assigned to ore stockpiles and gold in circuit items of
inventory on the basis of weighted average costs. Net realisable value is the estimated selling price in the ordinary course of business
(excluding derivatives) less the estimated costs of completion and the estimated costs necessary to make the sale. Inventory write
offs and net realisable value movements are presented in the Statement of Comprehensive Income in “inventories write off and net
realisable value movements” as these are non-cash and do not relate to cost of production for gold sales during the year. During the
year an expense of $44,258,000 (2020: $175,000) was recognised. The current year expense relates to write-off of low-grade stockpiles
at Mako of $15,991,000 and movement in net realisable value movements on the Syama and Mako inventories of $28,297,000.
Consumables have been valued at cost less an appropriate provision for obsolescence. Cost is determined on a
weighted average basis.
100
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
D.3 Other financial assets and liabilities
Financial assets at fair value through other comprehensive income (current)
Shares at fair value – listed
Other financial assets (current)
Environmental bond – restricted cash (face value approximates fair value)
Restricted cash1
Environmental bond – restricted cash (face value approximates fair value)(1)
31 December 2021 31 December 2020
$’000
$’000
20,828
36,004
518
8,925
9,443
-
-
-
(1) This balance relates to an overpayment received on a gold sale at 31 December 2021. The amount was returned immediately post year end.
Recognition and measurement
Financial assets at fair value through other comprehensive income
These financial assets consist of investments in ordinary shares, comprising principally of marketable equity securities. Investments
are initially recognised at fair value plus transaction costs. Unrealised gains and losses arising from changes in the fair value of
these investments are recognised in equity in the financial assets revaluation reserve. Amounts recognised are not recycled to the
statement of comprehensive income in future years.
The fair value of the listed securities are based on quoted market prices and accordingly is a Level 1 measurement basis on the fair
value hierarchy.
Use of derivative instruments to assist in managing gold price risk
As part of the Group’s risk management practices, selected financial instruments (such as gold forward sales contracts, gold
call options and gold put options) may be used from time to time to reduce the impact a declining gold price has on project life
revenue streams. Within this context, the programs undertaken are project specific and structured with the objective of retaining
as much upside to the gold price as possible, and in any event, limiting derivative commitments to no more than 10% of the Group’s
gold reserves. The value of these financial instruments at any given point in time, will in times of volatile market conditions, show
substantial variation over the short term. The hedging facilities provided by the Group’s counterparties do not contain margin calls.
The Group did not hedge account for these instruments as they are out of scope of AASB 9.
D.4 Payables
Trade creditors
Accruals
Held for sale deposit
Total payables
31 December 2021 31 December 2020
$’000
$’000
34,267
57,275
-
91,542
40,740
37,526
5,566
83,832
Recognition and measurement
Liabilities for trade creditors and other amounts are carried at amortised cost which is the amount initially recognised, minus
repayments whether or not billed to the consolidated entity.
Payables to related parties are carried at the principal amount. Interest, when charged by the lender, is recognised as an expense on
an accruals basis. Payables are non-interest bearing and generally settled on 30-90 day terms. Due to the short-term nature of these
payables, their carrying value is assumed to approximate their fair value.
101
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
D.5 Provisions
Current
Site restoration
Employee entitlements
Dividend payable
Withholding taxes
Provision for indirect taxes
Other provisions
Total provisions (current)
Non Current
Site restoration
Employee entitlements
Total provisions (non current)
31 December 2021
$’000
31 December 2020
$’000
1,795
2,511
150
-
50,381
2,328
57,165
72,172
1,252
73,424
352
4,922
104
237
68,533
1,572
75,720
71,335
528
71,863
Resolute’s subsidiaries SOMISY and PMC, have received demands for payment to the Local Tax Authorities in relation to Income Tax
and Value Added Tax (VAT) for the tax years ended 31 December 2015 to 2020, shown i the table above.
At 31 December 2021 the company has recognised an additional $30.9 million of indirect tax provisions in Mali in line with
the correspondence received during the financial year along with the requirements of the accounting standards. As noted in
D.1, the Group has recorded approximately $56.6 million of demands which offsets against carried forward VAT receivables.
Resolute continues to challenge the factual basis and validity of these demands which are strongly disputed due to fundamental
misinterpretations of the application of certain taxes. Resolute continues to work with its legal and tax advisors to contest the
positions taken by the Authorities.
Due to the Senegalese Governments proposed reduction in the Mako tax exoneration period to 5 years, which is disputed by
Resolute, a tax provisions have been recognised for $10.1 million relating to the VAT receivable (refer Note D.1) and $4.4 million
in tax provisions for duties. These amounts are recognised as provisions, however Resolute is firmly of the view that it has complied
with all the requirements for the extension of the tax exoneration and will continue to work with the Senegalese authorities to resolve
this matter.
Recognition and measurement
Provisions are recognised when the Group has a present obligation as a result of a past event, it is probable that an outflow of
resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount
of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future
cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks
specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as a
borrowing cost.
Employee benefits
The Group does not expect its long service leave or annual leave benefits to be settled wholly within 12 months of each reporting
date. The Group recognises a liability for long service leave and annual leave measured as the present value of expected future
payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected
future wage and salary levels, experience of employee departures, and years of service. Expected future payments are discounted
using market yields at the reporting date on high quality corporate bonds with terms to maturity and currencies that match, as closely
as possible, the estimated future cash outflows.
Restoration obligations
The Group records the present value of the estimated cost of obligations, such as those under the consolidated entity’s Environmental
Policy, to restore operating locations in the year in which the obligation is incurred. The nature of restoration activities includes
dismantling and removing structures, rehabilitating mines, dismantling operating facilities, closure of plant and waste sites and
restoration, reclamation and revegetation of affected areas.
102
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
31 December 2021
$’000
31 December 2020
$’000
71,687
-
609
4,267
(951)
(1,645)
73,967
1,795
72,172
73,967
65,187
(8,097)
778
11,092
(929)
3,656
71,687
352
71,335
71,687
D.5 Provisions (continued)
Site restoration
Balance at the beginning of the year
Reclassification of provision for discontinued operations
Rehabilitation and restoration provision accretion
Change in scope of restoration provision
Utilised during the year
Foreign exchange translation
Balance at the end of the year
Reconciled as:
Current provision
Non current provision
Total provision
Key estimates and judgements
Restoration
In determining an appropriate level of provision, consideration is given to the expected future costs to be incurred, the timing of these
expected future costs (largely dependent on the life of the mine), and the estimated future level of inflation. The discount rate used
in the calculation of these provisions is consistent with the risk-free rate. The ultimate cost of decommissioning and restoration is
uncertain, and costs can vary in response to many factors including changes to the relevant legal requirements, the emergence of
new restoration techniques or experience at other mine sites. The expected timing of expenditure can also change, for example in
response to changes in reserves or to production rates. Changes to any of the estimates could result in significant changes to the
level of provisioning required, which would in turn impact future financial results.
103
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
D.6 Leases
The Group has lease contracts for various items of mining equipment and buildings used in its operations. Leases of mining
equipment generally have lease terms between three and seven years, while buildings generally have lease terms between three and
five years. Generally, the Group is restricted from assigning and subleasing the leased assets
The Group also has certain contracts which contain a lease with terms of 12 months or less and contracts which contain a lease of
low value. The Group applies the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these.
Buildings
$’000
Plant and
Equipment
$’000
1,691
-
-
(601)
(28)
(5)
1,057
2,836
(1,779)
1,057
1,895
-
-
(672)
75
(79)
1,219
548
671
1,219
20,827
8,438
(10,905)
(8,210)
(3,090)
(409)
6,651
39,240
(32,589)
6,651
21,712
8,135
(10,744)
(9,381)
785
(649)
9,858
2,443
7,415
9,858
Total
$’000
22,518
8,438
(10,905)
(8,811)
(3,118)
(414)
7,708
42,076
(34,368)
7,708
23,607
8,135
(10,744)
(10,053)
860
(728)
11,077
2,991
8,086
11,077
31 December 2021
Lease assets
At 1 January 2021
Additions
Lease modification
Depreciation
Impairment
Foreign currency translation
Balance at the end of the year
At 31 December 2021
Historical cost
Accumulated depreciation
Net carrying amount
Lease liabilities
At 1 January 2021
Additions
Lease modification
Repayments
Accretion of interest
Foreign currency translation
Balance at the end of the year
At 31 December 2021
Current
Non current
Carrying amount at 31 December 2021
104
Resolute Mining Limited 2021 Annual ReportFinancial Report
D.6 Leases (continued)
31 December 2020
Lease assets
At 1 January 2020
Additions
Lease remeasurements
Depreciation
Foreign currency translation
Balance at the end of the year
At 31 December 2020
Historical cost
Accumulated depreciation
Net carrying amount
Lease liabilities
At 1 January 2020
Additions
Lease remeasurements
Repayments
Accretion of interest
Foreign currency translation
Balance at the end of the year
At 31 December 2020
Current
Non current
Carrying amount at 31 December 2020
Notes to the Financial Statements
for the year ended 31 December 2021
Buildings
$’000
Plant and
Equipment
$’000
2,057
-
-
(555)
189
1,691
2,970
(1,279)
1,691
2,136
-
-
(621)
1 1 0
270
1,895
606
1,289
1,895
38,721
456
(2,848)
(15,066)
(436)
20,827
37,577
(16,750)
20,827
39,387
456
(2,893)
(16,571)
1,837
(504)
21,712
10,643
11,069
21,712
Total
$’000
40,778
456
(2,848)
(15,621)
(247)
22,518
40,547
(18,029)
22,518
41,523
456
(2,893)
(17,192)
1,947
(234)
23,607
11,249
12,358
23,607
Maturity profile of lease liabilities
The table below presents the contractual undiscounted cash flows associated with the Group’s lease liabilities, representing principal
and interest. The figures will not necessarily reconcile with the amounts disclosed in the consolidated statement of financial position.
Due for payment in:
1 year or less
1-2 years
2-3 years
3-4 years
4-5 years
More than 5 years
Total
31 December 2021
$’000
31 December 2020
$’000
3,421
1,317
849
642
642
7,227
14,098
12,320
8,216
4,762
219
-
-
25,517
105
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
D.6 Leases (continued)
Key estimates and judgements
Incremental borrowing rate
The Group cannot readily determine the interest rate implicit in its leases. Therefore, it uses the relevant incremental borrowing
rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the lessee would have to pay to borrow over a similar term
and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic
environment. The IBR, therefore, reflects what the lessee would have to pay, which requires estimation when no observable rates are
available and to make adjustments to reflect the terms and conditions of the lease. Lease liabilities were discounted using a weighted
average incremental borrowing rate for December 2021 of 4.2% (December 2020: 6.0%).
D.7 Derivative Financial Liabilities
31 December 2021
$’000
31 December 2020
$’000
Current
Liabilities at fair value through profit or loss
-
415
D.8 Financial Instruments
Derivative financial liabilities are measured at fair value on initial recognition and then subsequently re-measured at fair value by
reference to valuation models and the probability of outcome scenarios and categorised as level 3 measurements:
• Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)
•
•
Inputs other than quoted prices within level 1 that are observable for the asset or liability, either directly (that is, as prices) or
indirectly (that is, derived from prices) (level 2)
Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3) fair value
measurements.
Balance at the beginning of the year
Repurchase
Balance at the end of the year
31 December 2021
$’000
31 December 2020
$’000
-
-
-
12,112
(12,112)
-
Represents the fair value of the royalty payable to Taurus and is based on a discounted cashflow model using the Company’s Life of
Mine forecast gold production, future gold prices based on analyst forecasts and a discount rate that reflects the liability.
Key financial risks associated with other assets and liabilities
Interest rate risk, diesel price risk and foreign exchange risk management
Refer to About this Report and Section C for details of how these risks are managed.
Credit risk management
The Group’s exposure to credit risk arises from potential default of the counterparty, with a maximum exposure equal to the carrying
amount of the financial assets.
Credit risk is managed on a Group basis. Credit risk predominately arises from cash, cash equivalents (refer to C.1), gold bullion held
in metal accounts, derivative financial instruments, deposits with banks and financial institutions and receivables from statutory
authorities. For derivative financial instruments, management mitigates some credit risk by using a number of different hedging
counterparties. Credit risk further arises in relation to financial guarantees given to certain parties. Such guarantees are only provided
in exceptional circumstances and are subject to Audit and Risk Committee approval. With the exception of those items disclosed
in C.3, no guarantees have been provided to third parties as at the reporting date. The credit quality of financial assets that are
neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to historical information about
counterparty default rates.
With respect to credit risk arising from other financial assets for the Group, which comprise financial instruments, asset sale
receivables (refer to E.1) and contingent receivables (refer to E.1), the Group’s exposure to credit risk arises from default of the
counterparty, with a maximum exposure equal to the carrying amount of these instruments. The Group limits its counterparty
credit risk on these assets by dealing only with financial institutions with credit ratings of at least B or equivalent.
106
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
D.8 Financial Instruments (continued)
Foreign exchange risk management
The following table summarises the sensitivity to a reasonably possible change in foreign exchange rates with all other variables
held constant:
Foreign exchange risk(1)
-10%
+10%
Equity
$‘000
Profit
$’000
Equity
$‘000
31 December 2021
Other financial assets
Assets sale receivable
Loans to subsidiaries
Payables
Carrying Amount
$’000
29,753
56,495
736,238
91,542
Profit
$’000
811
5,136
66,931
417
811
5,136
66,931
417
Total increase/(decrease)
73,295
73,295
31 December 2020
Other financial assets
Loans to subsidiaries
Payables
Total increase/(decrease)
35,917
761,329
85,030
227
75,563
553
76,343
227
75,563
553
76,343
(1) The above analysis principally relates to the risks associated with movements in the Australian dollar against the US dollar.
.
(992)
(6,277)
(81,804)
(498)
(89,571)
(227)
(75,563)
(553)
(76,343)
(992)
(6,277)
(81,804)
(498)
(89,571)
(227)
(75,563)
(553)
(76,343)
107
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E: Other items
IN THIS SECTION
Information on items which require disclosure to comply with Australian Accounting Standards and the
Corporations Act 2001 (Cth). This section includes group structure information and other disclosures.
E.1 Asset Held for Sale and Discontinued Operation
Sale of Ravenswood Gold Mine
On 15 January 2020, Resolute signed a definitive agreement for the sale of the Ravenswood Gold Mine in Queensland to a consortium
comprising of a fund managed by private equity manager EMR Capital and energy and mining company Golden Energy and
Resources Limited. The consideration for the sale comprised A$50.0 million of cash up front, A$50.0 million promissory note and up to
A$200.0 million potential payments. The asset sale was completed on 31 March 2020 and was reported in the comparative period as a
discontinued operation.
Gold Price Contingent Payment Instrument
A Gold Price Contingent Payment is payable to Resolute for years following Financial Close based on the following bands:
• A$10m if the average gold price is greater than A$1,900/oz
• A$20m if the average gold price is greater than A$1,975/oz
• A$30m if the average gold price is greater than A$2,050/oz
• A$40m if the average gold price is greater than A$2,075/oz
• A$50m if the average gold price is greater than A$2,100/oz.
Payment of the Gold Price Contingent Payment is subject to the cumulative ounces produced from Ravenswood exceeding
500,000oz of gold over the four-year period and is subject to adjustment if the production adopted by the buyer is reduced or lower
than expected.
For the Gold Price Contingent Payment Instrument, we have assessed the likelihood of the production target being met as well as
the likely weighted average gold price to be achieved over the four-year period. We have used the following assumptions in the
determination of this variable consideration:
• Resolute assumed that the 500,000oz of gold production over the four-year period will be met.
• Resolute used forecast gold prices submitted by reputable banks and brokerage firms and forecast out to a period of up to 5 years.
• Resolute assessed that the occurrence of a liquidity event within the 4-year period to be unlikely.
The Gold Price Contingent Payment Instrument is valued at a net present value of A$20.0 million ($14.5 million) at 31 December 2021
and 31 December 2020, based on the most likely amount method.
The Promissory Note is initially valued at net present value of A$50.0 million and subsequently measured at amortised cost under
AASB 9 of A$55.4 million ($40.2 million) as at 31 December 2021.
The carrying amount of the promissory note at 31 December 2021 approximates its fair value.
Financial Instruments
Due after five years
Total contractual receipts
Less future interest charges
Total promissory notes receivable
Sale of Bibiani Gold Mine
31 December 2021
$’000
31 December 2020
$’000
54,596
54,596
(14,389)
40,207
57,952
57,952
(17,690)
40,262
On 5 August 2021, Resolute entered into a binding agreement to sell the Bibiani Gold Mine (Bibiani disposal group) in Ghana to
Asante Gold Corporation (Asante). Cash consideration of $90.0 million consisting of $30.0 million paid up front, $30.0 million on or
before 6 months from completion and $30.0 million on or before 12 months from completion is agreed for the transaction. The asset
sale was completed on 19 August 2021 and is reported in the current year as held for sale assets and liabilities. Total outstanding
amounts receivable from the sale of the Bibiani gold mine amounted to $56.5 million. This balance was initially recognised at fair value
less transaction costs and subsequently at amortised cost. The Bibiani disposal group is not presented as a discontinued operation in
the Consolidated Statement of Comprehensive Income as it does not meet the definition under the accounting standards. As a result
of the sale, $2.7 million of gain is recognised classified under Other Income.
108
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
E.1 Asset Held for Sale and Discontinued Operation (continued)
Sale of Cote d’Ivoire Assets
On 18 May 2021, Resolute and Manas Resources signed a comprehensive agreement to acquire Resolute’s exploration interest
in Côte d’Ivoire (Cote d’Ivoire disposal group) covering Predictive Discovery CDI SARL, Toro Gold CDI SARL, DS Resources Joint
Venture, Resolute CDI SARL and Nimba Resources SARL for A$1.0 million cash and A$4.0 million contingent consideration. The
contingent consideration will only be receivable 12 months after 1,000 oz of gold is produced from the relevant exploration permits.
The Group has constrained the value of the contingent consideration to nil using the most likely outcome approach. As the sale was
expected to be completed within 12 months, the net assets of the sale group had been classified as a disposal group held for sale.
In accordance with the requirements of AASB 5: Non-current Assets Held for Sale and Discontinued Operations, the Group had
conducted an impairment assessment immediately before the initial classification as a disposal group held for sale. As a result, the
Group had recognised an impairment loss amounting to $5.1 million, primarily in relation to the exploration and evaluation assets held
in Cote d’Ivoire. The Group had completed the sale process for the Cote d’Ivoire disposal group held for sale. The net assets of the
sale group are reported in the current year as held for sale assets and liabilities. The Cote d’Ivoire disposal group is not presented
as a discontinued operation in the Consolidated Statement of Comprehensive Income as it does not meet the definition under the
accounting standards.
31 December 2021
$’000
31 December 2020
$’000
Revenue
Cost of production relating to gold sales
Other operating costs relating to gold sales
Administration and other corporate expenses
Exploration and business development expenditure
Depreciation and amortisation
Finance cost
Fair value movements and unrealised treasury transactions
Loss before tax from discontinued operations
Tax expense
Loss for the year
Gain on disposal of discontinued operation (net of tax expense)
Profit after tax from discontinued operations
Gain per share
Basic gain per share relating to discontinued operation
Diluted gain per share relating to discontinued operation
The major categories of assets and liabilities within the disposal group are as follows:
Operating cash flows
Investing cash flows
Financing cash flows
Net cash flow
-
-
-
-
-
-
-
-
-
-
-
-
-
cents
-
-
15,268
(13,069)
(2,131)
(172)
(179)
(47)
(80)
(47)
(457)
-
(457)
41,932
41,475
cents
4.23
4.23
31 December 2021
$’000
31 December 2020
$’000
-
-
-
-
(2,611)
28,758
-
26,147
109
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.1 Asset Held for Sale and Discontinued Operation (continued)
Assets
Cash
Other financial assets – restricted cash
Other assets
Inventories
Property, plant and equipment
Exploration and evaluation
Total assets
Liabilities
Payables
Provisions
Site restoration
Total liabilities
Net assets held for sale
31 December 2021 31 December 2020
$’000
$’000
-
-
-
-
-
-
-
-
-
-
-
-
-
381
2,745
141
1,651
22,361
53,329
80,608
-
358
366
8,097
8,821
71,787
The above Net Assets held for sale represents the carrying value of the Bibiani disposal group with no fair value adjustments required
at balance date.
Recognition and measurement
The Group classifies non current assets and disposal groups as held for sale if their carrying amounts will be recovered principally
through a sale transaction rather than through continuing use. Non current assets and disposal groups classified as held for sale
are measured at the lower of their carrying amount and fair value less cost to sell. Costs to sell are the incremental costs directly
attributable to the disposal of an asset (disposal group), excluding finance costs and income tax expense.
The criteria for held for sale classification is regarded as met only when the sale is highly probable, and the asset or disposal group
is available for immediate sale in its present condition. Actions required to complete the sale should indicate that it is unlikely that
significant changes to the sale will be made or that the decision to sell will be withdrawn. Management must be committed to the
plan to sell the asset and the sale expected to be completed within one year from the date of the classification.
Property, plant and equipment and intangible assets are not depreciated or amortised once classified as held for sale.
Assets and liabilities classified as held for sale are presented separately as current items in the statement of financial position.
A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed of, or is classified
as held for sale, and:
•
•
Represents a separate major line of business or geographical area of operations
Is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or
• Is a subsidiary acquired exclusively with a view to resale.
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss
after tax from discontinued operations in the statement of profit and loss.
E.2 Contingent liabilities
Demand of payment relating to income taxes from the Mali Tax Authorities
Resolute’s subsidiary, SOMISY, received demands for payment of VAT and Income Tax for the tax years ended 31 December 2015 to
2020 from the Mali Tax Authorities. The demands relating to SOMISY’s VAT have been provided for (refer to Note D.5 for details).
The Group is working with its legal and tax advisors to contest the demands and will resist any efforts to enforce payment.
Amounts potentially payable to historical Bibiani creditors
Amounts relating to historical Bibiani creditors previously disclosed as Contingent liabilities, were transferred to Asante upon
disposal of Bibiani.
110
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.3 Commitments
Other commitments not disclosed elsewhere in this report include:
Randgold/Syama Royalty
Pursuant to the terms of the Syama Sale and Purchase Agreement, Randgold Resources Limited (now Barrick Gold Corporation)
receive a royalty on Syama production, where the gold price exceeds US$350 per ounce, of US$10 per ounce on the first million
ounces of gold production attributable to Resolute Mining Limited and US$5 per ounce on the next three million attributable ounces
of gold production. As at 31 December 2021, Resolute’s 80% attributable share of Syama’s project to date gold production was
1,439,693 ounces of gold, therefore the royalty is currently US$5 per ounce.
Gold contracts
As part of its risk management policy, the Group enters into gold forward contracts to manage the gold price for a proportion of
anticipated sales of gold. As at 31 December 2021, 178,000 ounces were hedged.
The gold forward contracts disclosed below did not meet the criteria of financial instruments for accounting purposes on the basis
that they met the normal purchase/sale exemption because physical gold would be delivered into the contract. Accordingly, the
contracts were accounted for as sale contracts with revenue recognised in the year in which the gold commitment was met.
31 December 2021
US$
Within one year
Total
EURO
Within one year
Total
31 December 2020
US$
Within one year
Total
Gold for Physical
Delivery Ounces
Contracted Gold
Sale Price
per Ounce
Value of
Committed Sales
$’000
168,000
168,000
10,000
10,000
$1,799
€1,530
$302,232
$302,232
€15,300
€15,300
Gold for Physical
Delivery Ounces
Contracted Gold
Sale Price
per Ounce
Value of
Committed Sales
$’000
123,000
123,000
$1,672
$205,656
$205,656
E.4 Auditor remuneration
EY Australia
Total amounts received or due and receivable for an audit or review
of the parents financial statements
EY Australia
Other EY firms
Other non-EY firms
Total amounts received or due and receivable for an audit or review
of any controlled entities financial statements
31 December 2021 31 December 2020
$
$
80,071
84,319
80,071
212,332
83,750
146,659
84,319
213,581
94,683
121,051
442,741
429,315
111
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
E.5 Investments in associates
Continuing Operations
Turaco Gold Limited(a)
Loncor Resources Inc
31 December 2021
31 December 2020
31 December 2021
31 December 2020
Shares held in associates
(No. of shares)
68,248,471
682,484,709
31,450,000
29,650,000
Percentage of ownership (%)
16.01%(a)
24.73%
23.61%
26.42%
Carrying Value
$’000
-
$’000
651
(a) Movements in the carrying amount of the Group’s investment in associates
At 1 January
Purchase of investment
Share of loss after income tax
Foreign currency translation
At 31 December
651
-
(615)
(36)
-
1,038
-
(469)
82
651
$’000
1,108
3,801
354
(3,223)
248
1,180
$’000
3,801
3,097
1,470
(1,192)
426
3,801
(b) Market value of investments in associates
Market value of the
Group's investment
6,071
3,156
16,346
13,264
(*) The Group has an investment in Kilo Goldmines Limited with a current carrying value of $185k as at 31 December 2021 (31 December 2020: $197k).
(a) Resolute holds a position on the board of directors and has significant influence over Turaco Gold Ltd (formerly known as Manas Resources Ltd).
The Group’s investment in associates is accounted for using the equity method of accounting in the consolidated financial
statements. An associate is an entity over which the Group has significant influence and that are neither subsidiaries nor joint
arrangements. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any
unsecured long-term receivables and loans, the Group does not recognise further losses, unless it has incurred obligations
or made payments on behalf of the associate.
112
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.6 Subsidiaries and non-controlling interests
Material subsidiaries
The following were materially controlled entities during the year and have been included in the consolidated accounts. All entities in
the consolidated entity carry on business in their place of incorporation.
Name of Controlled Entity
and Country of Incorporation
Consolidated Entity
Company Holding the Investment
31 December 2021
%
31 December 2020
%
Percentage of Shares
Held by Consolidated Entity
Bambuk Minerals Limited, Mauritius
Toro Gold Limited
Carpentaria Gold Pty Ltd, Australia
Resolute Mining Limited
Petowal Mining Company S.A., Senegal
Bambuk Minerals Limited
Resolute Canada Pty Ltd, Australia
Resolute Mining Limited
Resolute Canada 2 Pty Ltd, Australia
Resolute Mining Limited
Resolute Corporate Services Pty Ltd, Australia
Resolute (Treasury) Pty Ltd
Resolute Corporate Services UK Limited, UK
Toro Gold Limited
Resolute (Finkolo) Pty Ltd, Australia
Resolute Mining Limited
Resolute Mali S.A. Mali
Resolute (SOMISY) Pty Ltd
Resolute (SOMISY) Pty Ltd, Australia
Resolute Mining Limited
Resolute Treasury UK Limited, UK
Resolute Mining Limited
Resolute UK 1 Limited, UK
Resolute UK 2 Limited, UK
Resolute Mining Limited
Resolute UK 1 Limited
Société des Mines de Finkolo S.A., Mali
Resolute (Finkolo) Pty Ltd
Société des Mines de Syama S.A., Mali
Resolute (SOMISY) Pty Ltd
Toro Gold Limited, Guernsey
Resolute UK 2 Limited
(a) On 19 August 2021, Resolute has completed the sale of Bibiani.
Material partly-owned subsidiaries
Accumulated share of (deficiency)/equity attributable to material
Non-Controlling Interest:
Société des Mines de Syama SA ("SOMISY")
Mensin Gold Bibiani Limited ("Mensin")
Société des Mines de Finkolo SA ("Finkolo")
Petowal Mining Company SA ("Mako")
Asset held for sale
Total Non-Controlling Interest
(Loss)/profit allocated to material Non-Controlling Interest:
SOMISY
Mensin
Finkolo
Mako
Total Non-Controlling Interest
100
100
100
90
90
100
100
100
100
100
100
100
100
100
90
100
100
100
100
90
90
100
100
100
100
100
100
100
100
100
90
100
31 December 2021
$’000
31 December 2020
$’000
(80,274)
-
(1,904)
12,105
-
(48,406)
(6,981)
3,130
24,647
6,981
(70,073)
(20,629)
(36,844)
(339)
(5,018)
(6,067)
(48,268)
(18,336)
(474)
747
7,117
(10,946)
113
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.6 Subsidiaries and non-controlling interests (continued)
The summarised financial information of subsidiaries with non-controlling interests is provided below. This information is based on
amounts before inter-company eliminations.
31 December
2021
$'000
31 December
2020
$'000
31 December
2021
$'000
31 December
2020
$'000
31 December
2021
$'000
31 December
2020
$'000
31 December
2021
$'000
31 December
2020
$'000
SOMISY
Mensin
Finkolo
Mako
Statement of Comprehensive Income
Revenue
(Loss)/gain
for the year
Total
comprehensive
(loss)/income for
the year
295,418
204,666
-
-
32,347
123,919
221,478
274,400
(148,572)
(95,149)
(10,378)
28,860
(44,018)
7,179
(83,451)
57,879
(98,832)
(113,485)
(10,378)
28,386
(44,165)
7,927
(83,008)
64,996
Summarised Statement of Financial Position
Current assets
255,412
252,320
Non current assets
307,194
511,891
Current Liabilities
(158,700)
(153,471)
Non current
liabilities -
External
Non current
liabilities - Intra
Resolute Mining
Limited Group
Net asset /
(deficiency)
(44,180)
(45,988)
(737,182)
(777,579)
(377,456)
(212,827)
E.7 Subsequent events
-
-
-
-
-
-
4,919
75,691
(724)
3,708
24,918
(13,841)
5,812
41,612
53,301
83,046
144,864
225,611
(11,494)
(45,960)
(25,014)
(8,097)
(8,920)
(8,594)
(30,523)
(23,073)
(92,973)
(29,998)
120
(10,393)
(11,307)
(21,184)
(24,133)
27,456
111,289
249,263
On 31 January 2022, the Group completed the sale of its shares in Orca Gold Inc (Orca) to Perseus Mining Limited for total
consideration of $13.7 million.
On 17 February 2022, the Group announced that the Tabakoroni Measured and Indicated Mineral Resource estimate increased
to 9.2 million tonnes at 4.4g/t for 1.3 million ounces of gold a 40% increase over previous estimate.
On 22 February 2022, the Group received $30.0 million for the sale of the Bibiani Gold Mine, the final $30.0 million is receivable
in August 2022.
On 28 March 2022, the Group successfully completed the extended the Revolving Credit Facility. Refer to Note C.3 for further details.
E.8 Related party disclosures
Resolute is the ultimate Australian holding company and there is no controlling entity of Resolute at 31 December 2021. No related
party transactions occurred during the period other than payments to KMP as disclosed in E.10.
114
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.9 Parent Entity Information
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Issued capital
Accumulated losses
Reserve
Total shareholders’ equity
Total comprehensive (loss)/profit of Resolute Mining Limited
31 December 2021 31 December 2020
$’000
$’000
56,931
430,069
(4,509)
(4,509)
425,560
777,021
(435,710)
84,249
425,560
(233,970)
28,227
691,126
(1,336)
(1,340)
689,786
777,021
(127,067)
39,832
689,786
32,632
Refer to E.3 for the contingent liabilities and E.4 for the commitments of Resolute Mining Limited. The parent company guarantees
provided by Resolute Mining Limited are outlined in C.3.
E.10 Employee benefits and share-based payments
Salaries
Superannuation
Share-based payments expense
Total employee benefits charged to profit and loss
31 December 2021 31 December 2020
$’000
$’000
43,618
8,687
1,423
53,728
50,623
10,455
1,380
62,458
Share-based payments
Equity-based compensation benefits are provided to employees via the Group’s share option plan and performance rights plan.
The Group determines the fair value of securities issued and recognises an expense in the profit and loss over the vesting year with
a corresponding increase in equity.
Key management personnel
Details of remuneration provided to key management personnel are as follows:
Short-term employee benefits
Post-employment benefits
Long-term employment benefits
Share-based payments
Total
31 December 2021 31 December 2020
$
$
2,385,966
87,438
3,696
462,690
2,175,977
628,384
(34,040)
908,197
2,939,790
3,678,518
Key estimates and judgements
Share-based payments
The Group measures the cost of equity settled share-based payment transactions with reference to the fair value at the grant date
using a Black Scholes formula or Monte Carlo simulation. The valuations take into account the terms and conditions upon which
the instruments were granted such as the exercise price, the term of the option or performance right, the vesting and performance
criteria, the impact of dilution, the non-tradeable nature of the option or performance right, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option or
performance right.
115
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
E.10 Employee benefits and share-based payments (continued)
Performance rights plan
Performance Rights Plan Category
Type of employee
Band A0
Managing Director and CEO
CFO
COO
Band A1 and A2
Executive General Manager – Exploration
Executive General Manager – Business Development
Executive General Manager – Sustainability
Band B1
General Managers
Plan category Grant and frequency
Performance measures
Performance period
The rights will be performance tested against the relative total
shareholder return (“RTSR”) measure over a 3 year period
3 years
Band AO
Annually set at 100%
of fixed remuneration
for the Managing
Director and CEO
CEO LTI Grant
50% of the rights will be performance tested against the relative
total shareholder return (“RTSR”) measure over the relevant
year; and
50% of the rights will be performance tested against the
specified strategic objectives over the relevant year
Band A1
and A2
Band B1
Annually set at 65%
of fixed remuneration
The rights will be performance tested against the relative total
shareholder return (“RTSR”) measure over a 3 year period
Annually set at 40%
of fixed remuneration
The rights will be performance tested against the relative total
shareholder return (“RTSR”) measure over a 3 year period
3 years
3 years
3 years
Issue Date
Total Number
Fair Value per
Right at
Grant Date
A$
Vesting Date
26/10/2018
21/05/2019
21/05/2019
22/05/2020
22/05/2020
35,561
426,977
587,956
500,000
43,668
22/05/2020
1,206,623
22/05/2020
194,352
14/05/2021
1,000,000
14/05/2021
14/07/2021
904,892
443,716
14/07/2021
1,703,599
06/12/2021
06/12/2021
06/12/2021
211,276
219,942
264,171
7,742,733
$0.92
$0.88
$0.93
$0.49
$0.78
$0.85
$0.56
$0.48
$0.57
$0.43
$0.57
$0.37
$0.31
$0.32
30/06/2021
31/12/2021
31/12/2021
31/12/2021
31/12/2021
31/12/2022
31/12/2022
31/03/2024
31/12/2023
31/12/2023
31/12/2023
31/12/2023
31/12/2023
31/12/2023
Performance rights on issue
Band A1 and A2
Band A0
Band A1 and A2
Band A0
Band A1 and A2
Band A1 and A2
Band A0
Band A0
Band A0
Band A1 and A2
Band A1, A2 and B1
Band B1
Band B1
Band A1 and A2
As at 31 December 2021
116
Resolute Mining Limited 2021 Annual ReportFinancial Report E.10 Employee benefits and share-based payments (continued)
Notes to the Financial Statements
for the year ended 31 December 2021
Issue Date
Total Number
Fair Value
per Right at
Grant Date
A$
Vesting Date
Opening number of performance rights
5,173,888
Decrease through lapsing of performance rights (Band A1 and A2)
11/02/2021
(148,885)
$0.92
30/06/2021
Decrease through lapsing of performance rights (Band A1 and A2)
11/02/2021
(299,488)
$0.93
31/12/2021
Decrease through lapsing of performance rights (Band A1 and A2)
11/02/2021
(309,145)
$0.85
31/12/2022
Decrease through lapsing of performance rights (Band A1 and A2) 30/04/2021
(8,627)
$0.92
30/06/2021
Increase through issue of performance rights to eligible
employees (Band A0)
Increase through issue of performance rights to eligible
employees (Band A0)
14/05/2021
1,000,000
$0.48
31/03/2024
14/05/2021
904,892
$0.57
31/12/2023
Decrease through lapsing of performance rights (Band A1 and A2)
28/05/2021
(8,407)
$0.92
30/06/2021
Increase through issue of performance rights to eligible
employees (Band A1 and A2)
Increase through issue of performance rights to eligible
employees (Band A1, A2 and B1)
14/07/2021
443,716
$0.43
31/12/2023
14/07/2021
1,703,599
$0.57
31/12/2023
Decrease through lapsing of performance rights (Band A1 and A2)
23/07/2021
(26,292)
$0.93
31/12/2021
Decrease through lapsing of performance rights (Band A1 and A2)
23/07/2021
(216,022)
$0.85
31/12/2022
Decrease through lapsing of performance rights (Band A0)
23/11/2021
(181,338)
$0.77
30/06/2021
Decrease through conversion of shares upon vesting of
performance rights (Band A0)
23/11/2021
(34,541)
$0.77
30/06/2021
Decrease through lapsing of performance rights (Band A1 and A2)
23/11/2021
(209,133)
$0.92
30/06/2021
Decrease through conversion of shares upon vesting of
performance rights (Band A1 to A2)
23/11/2021
(4,273)
$0.92
30/06/2021
Decrease through lapsing of performance rights (Band A0)
23/11/2021
(732,600)
$0.72
30/06/2021
Increase through issue of performance rights to eligible
employees (Band B1)
Increase through issue of performance rights to eligible
employees (Band B1)
Increase through issue of performance rights to eligible
employees (Band A1 and A2)
06/12/2021
211,276
$0.37
31/12/2023
06/12/2021
219,942
$0.31
31/12/2023
06/12/2021
264,171
$0.32
31/12/2023
Closing number of performance rights
7,742,733
117
Resolute Mining Limited 2021 Annual ReportFinancial Report
Notes to the Financial Statements
for the year ended 31 December 2021
E.10 Employee benefits and share-based payments (continued)
The following tables list the key variables used in the valuation of each performance rights granted to key management personnel
during the year ended 31 December 2021:
Hurdle
RTSR rights
RTSR rights
RTSR rights
Strategic
objectives rights
RTSR
rights
1 January 2021
Grant
20 February 2021
Grant
4 May 2021
Grant
14 May 2021
Grant
Number of performance rights issued
1,703,599
443,716
904,892
500,000
500,000
Underlying share price ($)
Exercise price ($)
Risk free rate
Volatility factor
Dividend yield
Period of the rights from grant date (years)
0.84
-
0.09%
53.0%
1.91%
3.00
0.64
-
0.09%
53.0%
1.91%
2.86
0.84
-
0.09%
53.0%
1.91%
2.64
0.59
-
0.09%
53.0%
1.91%
2.88
0.59
-
0.09%
53.0%
1.91%
2.88
Hurdle
RTSR rights
RTSR rights
RTSR rights
1 July 2021 Grant
30 August 2021 Grant
1 September 2021 Grant
Number of performance rights issued
Underlying share price ($)
Exercise price ($)
Risk free rate
Volatility factor
Dividend yield
Period of the rights from grant date (years)
211,276
0.54
-
0.13%
53.0%
0.93%
2.50
264,171
0.46
-
0.08%
53.0%
0.93%
2.34
219,942
0.46
-
0.10%
53.0%
0.93%
2.33
Effect of performance hurdles
Fair value of performance rights granted
Value of performance right at grant date (Band A0)
Value of performance right at grant date (Band A0)
Value of performance right at grant date (Band A1 and A2)
Value of performance right at grant date (Band A1, A2 and B1)
Value of performance right at grant date (Band B1)
Value of performance right at grant date (Band B1)
Value of performance right at grant date (Band A1 and A2)
$0.48
$0.57
$0.43
$0.57
$0.37
$0.31
$0.32
118
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.10 Employee benefits and share-based payments (continued)
The following tables list the key variables used in the valuation of each performance rights granted to key management personnel
during the year ended 31 December 2020:
20 January 2020 Grant
20 January 2020 Grant
Hurdle
Reserve and
resources rights
TSR
rights
Reserve and
resources rights
Number of performance rights issued
125,000
375,000
10,917
Underlying share price ($)
Exercise price ($)
Risk free rate
Volatility factor
Dividend yield
Period of the rights from grant date (years)
1.18
-
0.88%
46%
1.91%
1.95
1.18
-
0.88%
46%
1.91%
1.95
1.18
-
0.88%
46%
1.91%
1.61
TSR
rights
32,751
1.18
-
0.88%
46%
1.91%
1.61
Hurdle
Reserve and
resources rights
TSR
Strategic
objectives rights
ATSR
rights
Total
1 January 2020 Grant
21 May 2020 Grant
Number of performance rights issued
432,948
1,298,842
174,917
524,751
2,975,126
Underlying share price ($)
Exercise price ($)
Risk free rate
Volatility factor
Dividend yield
Period of the rights from grant date (years)
1.24
-
0.88%
46%
1.91%
3.00
1.24
-
0.88%
46%
1.91%
3.00
1.14
-
0.88%
46%
1.91%
2.61
1.14
-
0.88%
46%
1.91%
2.61
Effect of performance hurdles
Fair value of performance rights granted
Value of performance right at grant date (Band A1 to A2)
Value of performance right at grant date (Band A1 to A2)
Value of performance right at grant date (Band A1 to A2)
Value of performance right at grant date (Band A0)
$0.49
$0.78
$0.85
$0.56
119
Resolute Mining Limited 2021 Annual ReportFinancial Report Notes to the Financial Statements
for the year ended 31 December 2021
E.11 Other accounting policies
New and amended Accounting Standards and Interpretations issued but not yet effective
A number of new Standards, amendment of Standards and interpretations have recently been issued but are not yet effective and
have not been adopted by the Group as at the financial reporting date. The potential effect of these Standards is yet to be fully
determined. However, it is not expected that the new or amended standards will significantly affect the Group’s accounting policies,
financial position or performance, except for the following:
Title
Application Date for Group
Detail
Amendments to
AASB 101:
Classification of
Liabilities as
Current or
Non-current
Reference to the
Conceptual
Framework –
Amendments to
AASB 3
Property, Plant and
Equipment:
Proceeds before
Intended Use –
Amendments to
AASB 116
Onerous
Contracts –
Costs of Fulfilling
a Contract –
Amendments to
AASB 137
AASB 9 Financial
Instruments – Fees
in the ’10%’ test for
derecognition of
financial liabilities
1 January 2023
In January 2020, the IASB issued amendments to paragraphs 69 to 76 of
AASB 101 to specify the requirements for classifying liabilities as current or
non-current. The amendments clarify:
• what is meant by a right to defer settlement
• that a right to defer must exist at the end of the reporting year
• that classification is unaffected by the likelihood that an entity will
exercise its deferral right
• that only if an embedded derivative is a convertible liability is itself
an equity instrument would the terms of a liability not impact its
classification.
The Group is currently assessing the impact the amendments will have on
current practice and whether existing loan agreements may require
renegotiation.
1 January 2022
In May 2020, the IASB issued Amendments to AASB 3 Business Combina-
tions - Reference to the Conceptual Framework.
1 January 2022
The amendments are intended to replace a reference to the Framework for
the Preparation and Presentation of Financial Statements, issued in 1989,
with a reference to the Conceptual Framework for Financial Reporting
issued in March 2018 without significantly changing its requirements. The
amendments are not expected to have a material impact on the Group.
In May 2020, the IASB issued Property, Plant and Equipment — Proceeds
before Intended Use, which prohibits entities deducting from the cost of
an item of property, plant and equipment, any proceeds from selling items
produced while bringing that asset to the location and condition necessary
for it to be capable of operating in the manner intended by management.
Instead, an entity recognises the proceeds from selling such items, and the
costs of producing those items, in profit or loss. The amendments are not
expected to have a material impact on the Group.
1 January 202
In May 2020, the IASB issued amendments to AASB 137 to specify
which costs an entity needs to include when assessing whether
a contract is onerous or loss-making.
1 January 2022
As part of its 2018-2020 annual improvements to IFRS standards process
the IASB issued amendment to AASB 9. The amendment clarifies the fees
that an entity includes when assessing whether the terms of a new or
modified financial liability are substantially different from the terms of the
original financial liability. These fees include only those paid or received
between the borrower and the lender, including fees paid or received by
either the borrower or lender on the other’s behalf. An entity applies the
amendment to financial liabilities that are modified or exchanged on or
after the beginning of the annual reporting year in which the entity first
applies the amendment. The amendments are not expected to have a
material impact on the Group.
120
Resolute Mining Limited 2021 Annual ReportFinancial Report Directors’ Declaration
In accordance with a resolution of the directors of Resolute Mining Limited, we state that:
In the opinion of the directors:
a. the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including:
i. giving a true and fair view of the consolidated entity’s financial position as at 31 December 2021 and of its performance
for the year ended on that date; and,
ii. complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the
Corporations Regulations 2001;
b. the financial statements and notes also comply with International Financial Reporting Standards as disclosed throughout this
report; and
c. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
This declaration has been made after receiving the declarations required to be made to the directors in accordance with section
295A of the Corporations Act 2001 for the year ended 31 December 2021.
On behalf of the Board
Stuart Gale
Managing Director and Chief Executive Officer
Perth, Western Australia
29 March 2022
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Resolute Mining Limited 2021 Annual ReportFinancial Report
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor's report to the members of Resolute Mining Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Resolute Mining Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at 31
December 2021, the consolidated statement of comprehensive income, consolidated statement of
changes in equity and consolidated statement of cash flows for the year then ended, notes to the
financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a. Giving a true and fair view of the consolidated financial position of the Group as at 31 December
2021 and of its consolidated financial performance for the year ended on that date; and
b. Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit
addressed the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
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1.
Physical existence and valuation of ore stockpiles and gold in circuit
Why significant
How our audit addressed the key audit matter
Our audit procedures included the following:
► Obtained an understanding of the Group’s processes and
controls in place for determining the physical quantities
and metal contents of stockpiles and gold in circuit,
which included observation of the stockpile surveys at
the Syama and Mako mine sites during the financial
year.
► Assessed the qualifications, competence and objectivity
of the Group’s internal experts involved in determining
the quantity and recoverable metal content for ore
stockpiles and gold in circuit.
► Agreed the estimated grades, recovery rates and other
geophysical properties against the underlying reports
prepared by the Group’s internal experts and assessed
the reasonableness of this information based on the
current operations.
► Assessed the accuracy of the inventory valuation models
including assessing the nature of costs allocated to
inventories in determining the unit cost of inventories.
► Assessed the carrying value of inventories at 31
December 2021 to evaluate whether they were valued
at the lower of cost and net realisable value. This
included evaluating the assumptions and methodologies
used by the Group, in particular those relating to the
forecast gold price, costs to complete and gold
recoveries.
►
Evaluated the adequacy of the Group’s disclosures in the
financial report relating to inventories.
At 31 December 2021 the Group had ore
stockpiles and gold in circuit inventories of
$61,929,000 and $69,280,000 respectively
(refer to Note D.2 to the financial report).
Critical to the determination of the carrying
value of ore stockpiles and gold in circuit
inventories is the cost and net realisable value
assumptions adopted by the Group in measuring
the ore stockpiles and gold in circuit and the
determination of the physical existence of the
ore stockpiles (tonnes) and gold in circuit
(ounces).
We considered this to be a key audit matter
because of the:
►
►
►
Significant judgment required to assess the
quantity of ore stockpiles and the quantity
and recoverable metal content for gold in
circuit. This includes determination of
estimated grades, recovery rates and other
geophysical properties.
Significant estimates and judgments
involved in the valuation of ore stockpiles
and gold in circuit including the allocation
of operating costs to various stock types
included in ore stockpiles and gold in circuit
inventories.
Significant estimates involved in the
determination of the net realisable value of
ore stockpiles and gold in circuit, including
the appropriateness of the estimated
recoverable gold, selling price in the
ordinary course of business and estimated
costs of completion necessary to make the
sale.
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2.
Impairment assessment of non-current assets
Why significant
How our audit addressed the key audit matter
At 31 December 2021, the Group had non-
current assets of $501,363,000 comprising
capitalised development expenditure, property,
plant and equipment and right of use assets
(refer to Notes B.1 and D.6 to the financial
report).
At the end of each reporting period, the Group
exercises judgment in determining whether
there is any indication of impairment of these
assets. If any such indicators exist, the Group
estimates the recoverable amount of the
applicable assets. The Group assessed whether
any indicators of impairment were present at 31
December 2021 and concluded that an indicator
or indicators of impairment were present in
respect of the Mako Gold Mine and the Syama
Gold Mine cash generating units (CGUs). An
impairment loss of $55,023,000 for the Mako
Gold Mine CGU and $167,373,000 for the
Syama Gold Mine CGU was recognised for the
year ended 31 December 2021 (refer to Note
B.3 to the financial report).
We considered this to be a key audit matter
because of the:
► Significant judgment involved in
determining whether indicators of
impairment were present.
► Significant judgment and estimates involved
in the determination of the recoverable
amount of the Mako gold mine CGU and
Syama gold mine CGU including
assumptions relating to future gold prices,
operating and capital costs, the discount
rate used to reflect the risks associated with
the forecast cash flows having regard to the
current status of the CGUs and the resource
valuation multiples used to value the
resources not included in the life of mine
plans.
We evaluated the Group’s assessment as to the presence of
any indicators of impairment. Our audit procedures included
the following:
► Comparison of the Group’s market capitalisation
relative to its net assets.
► Reading operational reports, board reports, minutes
and market announcements.
► Consideration of changes to reserves and resources and
other macro-economic factors including the gold price
and discount rates.
► Consideration of impact of changes in tax regimes and
its impact on recoverable amount.
Our audit procedures related to the impairment assessment
made by the Group following the identification of impairment
indicators included the following:
► Ensured the Group's impairment methodology was in
accordance with the requirements of Australian
Accounting Standards.
► Evaluated the assumptions and methodologies used by
the Group, in particular, those relating to forecast cash
flows including inputs used to formulate them and the
resource valuation multiples used. This included
assessing, with involvement from our valuation
specialists, where appropriate, the gold prices with
reference to market prices (where available), market
research, market practice, market indices, broker
consensus, historical performance, discount rates and
resource valuation multiples.
► Tested the mathematical accuracy of the Group's
discounted cash flow impairment models and agreed
relevant data, including assumptions on timing and
future capital and operating expenditure, to the Group's
feasibility analysis of the CGUs and the latest Board
approved life of mine plan (as appropriate).
► Assessed the work of the Group's internal and external
experts with respect to the capital and operating
assumptions used in the cash flow forecasts. We also
considered the competence, qualifications and
objectivity of the experts and assessed whether key
capital and operating expenditure assumptions were
consistent with information in Board reports and
releases to the market.
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Why significant
How our audit addressed the key audit matter
► Assessed the work of the Group's experts with respect
to the reserve and resource assumptions used in the
cash flow forecasts. This included understanding the
estimation process. We also examined the competence,
qualifications and objectivity of the Group's experts,
and assessed whether key economic assumptions were
consistent with those used elsewhere in the financial
report.
► Assessed the impact of a range of sensitivities to the
economic assumptions underpinning the Group's
impairment assessment.
► Evaluated the adequacy of the Group's disclosures in
the financial report relating to impairment.
3. Rehabilitation and restoration provisions
Why significant
How our audit addressed the key audit matter
As a consequence of its operations, the Group
incurs obligations to rehabilitate and restore its
mine sites. Rehabilitation activities are
governed by local legislative requirements. At
31 December 2021 the Group’s consolidated
statement of financial position includes
provisions of $73,967,000 in respect of these
obligations (refer to Note D.5 to the financial
report).
We considered this to be a key audit matter
because estimating the rehabilitation and
restoration provision requires considerable
judgement in relation to when the activities will
take place, the time required for rehabilitation
to be effective, the costs associated with the
activities and economic assumptions such as
discount rates and inflation rates. Given the
significant judgements and assumptions
involved, the Group is required to continually
reassess and confirm that the assumptions used
are appropriate.
We evaluated the assumptions and methodologies used by the
Group in determining their rehabilitation obligations. Our
audit procedures included the following:
► Assessed the qualifications, competence and objectivity
of the Group’s external and internal experts, the work of
whom, formed the basis of the Group’s rehabilitation
cost estimates.
► With the involvement of our subject matter specialists
we assessed the appropriateness of the rehabilitation
cost estimates
► Considered the estimated timing of when the
rehabilitation cash flows will be incurred based on the
life of mine and the resultant inflation and discount rate
assumptions used in the Groups cost estimates, having
regard to available economic data relating to future
inflation and discount rates.
►
Evaluated the adequacy of the Group’s disclosures
relating to rehabilitation obligations and considered the
appropriateness of the accounting for the changes in the
rehabilitation and restoration provision.
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4.
Taxation
Why significant
How our audit addressed the key audit matter
Our audit procedures in relation to indirect tax, current and
deferred tax included the following:
►
Involved our tax specialists in the interpretation of
enacted tax laws in these multiple jurisdictions, where
necessary, including assessing the reasonableness of the
related judgments and interpretations made by the
Group.
► Considered the appropriateness of the Group’s
assumptions and estimates in relation to tax positions,
assessed those assumptions and considered the advice
the Group received from external experts to support the
accounting for the tax positions in accordance with
enacted laws.
► Considered the appropriateness of the tax assets and
liabilities recognised by the Group at 31 December 2021
having regard to the requirements of the applicable
accounting standards.
► Where external experts were engaged by the Group, we
assessed their qualifications, competence and
objectivity.
► Assessed the adequacy of the Group’s disclosures
relating to taxation in the 31 December 2021 financial
report.
The Group has operations in multiple countries,
each with its own taxation legislation. The
nature of the Group’s activities give rise to
various taxation obligations including corporate
income tax, VAT, royalties, employment related
taxes, and other indirect taxes.
As set out in the consolidated statement of
financial position the Group has a current tax
payable of $7,137,000, non-current tax
receivable of $18,273,000, and recognised
deferred tax liabilities of $1,591,000 at 31
December 2021. The Group has recognised a
tax expense of $39,682,000 for the year ended
31 December 2021. In addition, as set out in
Notes D.1 and D.5 to the financial report, the
Group has indirect tax receivables from the Mali
Tax Office of $27,371,000 and a provision for
indirect tax payable to the Mali Tax Office of
$50,381,000 as at 31 December 2021.
Further, as set out in Notes A.4 to the financial
report the Group has significant unrecognised
tax assets as at 31 December 2021.
We considered this to be a key audit matter
because the Group is required to exercise
significant judgment with regards to
interpretation of enacted tax laws in these
multiple countries which in turn requires
significant judgment in estimating the Group’s
taxation assets and liabilities at 31 December
2021. The Group engages external independent
tax advisors to assist with the interpretation of
tax laws and the estimation of its tax assets and
liabilities.
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Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2021 annual report, but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, 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
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
►
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
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► Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
► Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 31
December 2021.
In our opinion, the Remuneration Report of Resolute Mining Limited for the year ended 31 December
2021, complies with section 300A of the Corporations Act 2001.
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Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Ernst & Young
Fiona Drummond
Partner
Perth
29 March 2022
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Resolute Mining Limited 2021 Annual ReportFinancial Report
Shareholder Information
As at 28 February 2022
Substantial Shareholders
Ordinary Shares
ICM Limited
Baker Steel Capital Managers LLP
Distribution Of Equity Securities
Size of Holding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - and over
Total equity security holders
Number of equity security holders with less than a marketable parcel
Voting Rights
a) Ordinary Shares
Number of Shares
% of Issued Capital
130,884,515
60,430,287
11.9
5.5
Number of Shares
Ordinary Shares
2,357
4,545
2,370
4,765
670
14,707
3,672
0.12
1.15
1.71
14.03
82.99
100.00
Under the Company’s Constitution, all ordinary shares issued by the Company carry one vote per share without restriction
Twenty Largest Shareholders
Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
ICM Limited
Baker Steel Capital Managers LLP
Vanguard Group Holdings
Dimensional Fund Advisors LP
ASF Africa Mining LP
Van Eck Associates Corporation
DST Systems Inc
Konwave AG
L1 Capital Pty Ltd.
Macquarie Group Limited
Ingot Capital Management Pty. Ltd.
Mitsubishi UFJ Financial Group, Inc.
Schroders PLC
BlackRock, Inc.
Accident Compensation Corporation
UBS AG
Wellington Management Company LLP
State Street Corporation
Australian Super - Member Direct
20
Stabilitas GmbH
130
Number of Shares
% of Issued Capital
130,884,515
60,430,287
48,357,676
44,769,072
41,189,189
40,393,270
20,152,633
19,839,309
19,365,906
17,463,506
17,313,501
14,976,352
13,328,337
11,668,484
11,310,223
11,024,828
10,206,320
9,789,994
8,498,785
7,000,000
11.86
5.47
4.38
4.06
3.73
3.66
1.83
1.80
1.75
1.58
1.57
1.36
1.21
1.06
1.02
1.00
0.92
0.89
0.77
0.63
557,962,187
50.55
Resolute Mining Limited 2021 Annual ReportFinancial Report Additional
Information
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Corporate Directory
Stay In Touch
Website
Resolute maintains a website where all major
announcements to the ASX/LSE are available:
www.rml.com.au
www.linkedin.com/company/resolute-mining
Twitter
@ResoluteMining
Registered Office
Level 2, Australia Place
15-17 William Street
Perth, Western Australia 6000
PO Box 7232 Cloisters Square
Perth, Western Australia 6850
T + 61 8 9261 6100
F + 61 8 9322 7597
E contact@rml.com.au
www.rml.com.au
Australian Business Number
ABN 39 097 088 689
Share Registry
Computershare Investor Services Pty Limited
Level 11, 172 St Georges Terrace
Perth, Western Australia 6000
Home Exchange
Australian Securities Exchange
Level 40, Central Park
152-158 St Georges Terrace
Perth, Western Australia 6000
Quoted on the official lists of the Australian Securities Exchange
(ASX) and the London Stock Exchange (LSE) under the ticker “RSG”
Auditor
Ernst & Young
Ernst & Young Building
11 Mounts Bay Rd
Perth, Western Australia 6000
Shareholders wishing to receive copies of Resolute’s ASX
announcements by e-mail should register their interest by
contacting the Company at contact@rml.com.au
Securities on Issue
29 March 2022
Ordinary Shares
Performance Rights
1,103,931,520
7,742,733
132
Resolute Mining Limited 2021 Annual Report
Creating value for
shareholders
and communities
where we operate.
rml.com.au
133
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