St George Mining Limited
Annual Report 2023

Plain-text annual report

ACN 139 308 973 ANNUAL REPORT 2023 CORPORATE DIRECTORY/CONTENTS PAGE CORPORATE DIRECTORY Board of Directors John Prineas – Executive Chairman John Dawson – Non-Executive Director Sarah Shipway – Non-Executive Director Company Secretary Sarah Shipway Principal Office Level 2, Suite 2 28 Ord Street West Perth WA 6005 Registered Office Level 2, Suite 2 28 Ord Street West Perth WA 6005 Tel: + 61 8 6118 2118 Website: www.stgeorgemining.com.au Email: info@stgeorgemining.com.au Australian Business Number ABN 21 139 308 973 Share Register Computershare Investor Services Pty Ltd Level 17 221 St Georges Terrace PERTH WA 6000 Tel: 1300 850 505 Int: +61 8 9323 2000 Fax: + 61 8 9323 2033 Stock Exchange Code SGQ – Ordinary Shares Auditors Stantons Bankers Commonwealth Bank CONTENTS PAGE Chairman’s Letter Review of Operations Directors’ Report Consolidated Statement of Profit or Loss and Other Comprehensive Income Consolidated Statement of Financial Position Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Consolidated Financial Report Directors’ Declaration Auditor’s Independence Declaration Independent Auditor’s Report Shareholder Information Schedule of Tenements 3 5 20 30 31 32 33 34 60 61 62 66 68 St George Mining Limited – Annual Report 2023 P 2 CHAIRMAN’S LETTER Dear Shareholders On behalf of the Board of St George Mining, I am pleased to present this Annual Report for 2023. The year in review was a transformational one for St George as we expanded the Company’s portfolio of clean energy metals projects and welcomed globally significant lithium-ion battery players as major shareholders. We have created a strong platform of growth for the Company, with highly prospective projects in sought-after provinces across Western Australia and the strong support of our new strategic investors. Your Company’s strategy remains unchanged – to pursue sustained value for all shareholders by identifying high-leverage, greenfields exploration opportunities in Tier 1 destinations like Western Australia and applying disciplined, modern exploration methods to advance the potential for significant discoveries. We know that exploration requires patience but are heartened by the progress made during the year. The main focus in FY23 was to test the lithium prospectivity at the Mt Alexander Project, in the northern Goldfields. Mt Alexander is our most advanced asset and already hosts several high-grade nickel-copper sulphide discoveries. Drilling of recently identified LCT pegmatites at Mt Alexander confirmed high-grade and anomalous lithium across a wide area. Most encouraging was the very thick 121m fractionated zone of pegmatites intersected in hole MAD213 at the Manta Prospect. These types of pegmatites are what is required for a large mineral deposit and provide encouragement for the potential across our large project tenure. The prospective pegmatite corridor at Mt Alexander extends for more than 15km, with less than 3km of this tested by drilling. Exploration will continue in FY24 to unlock the full potential at Mt Alexander which represents a dominant landholding in a region that has over the past 12 months become one of Western Australia’s lithium hotspots. Mt Alexander’s tenements adjoin Delta Lithium’s (ASX: DLI) Mt Ida project, which has attracted the attention of Mineral Resources (ASX: MIN) as well as the Mt Bevan project being jointly explored by Legacy Iron Ore (ASX: LCY) and its partner Hancock Prospecting. Rio Tinto (ASX: RIO) has secured a significant tenement position in the region while to the north of Mt Alexander is Liontown Resources’ (ASX: LTR) Kathleen Valley development, which is the subject of significant M&A activity. We have made significant progress during the year to add to our portfolio of exciting, high-leverage exploration assets. We established lithium, rare earths and copper prospects at the new Woolgangie Project, in the southern Goldfields west of Kambalda. A pipeline of lithium prospects has also been established at seven discrete projects acquired by our subsidiary Lithium Star Pty Ltd. These lithium prospects include several that are along strike or proximal to producing lithium mines and major lithium deposits and provide the Company with multiple targets for a new discovery. The Ajana and Broadview Projects are also part of this high-leverage exploration strategy and both have potential for the discovery of a blind base metals deposit. Planning for a maiden drill programme at Ajana was completed during the year, with drilling commencing subsequent to year’s end and delivered encouraging base metals intercepts. The outcome of this maiden drill programme augurs well for our exploration plans at Ajana in FY24. St George Mining Limited – Annual Report 2023 P 3 CHAIRMAN’S LETTER St George is fortunate to have a highly credentialled, experienced and motivated team of professionals who lead exploration activities at our projects. I thank them on behalf of all shareholders for their dedication to systematically progress all our work programmes during the year. We look forward to another productive year in FY24 as we progress exploration at our projects to target the discovery of high-demand clean energy metals. We believe these commodities will continue to see unprecedented demand as the energy transition continues over the coming decades, providing St George with an excellent opportunity to pursue and deliver long-term value. On behalf of the Board of Directors, I thank shareholders for your continuing support and look forward to catching up with many of you at our Annual General Meeting in Perth in November. John Prineas Executive Chairman St George Mining Limited – Annual Report 2023 P 4 REVIEW OF OPERATIONS Operational activities for the year ending 30 June 2023 centred on building the Company’s portfolio of clean energy metals projects – through both systematic exploration and the acquisition of new opportunities. All projects are located in Western Australia – the world’s premier address for hard-rock lithium assets. Figure 1- map of the south-east Yilgarn of Western Australia showing St George’s multiple projects in the region as well as major lithium mines and deposits. MT ALEXANDER PROJECT – LITHIUM LITHIUM POTENTIAL ESTABLISHED St George’s Mt Alexander Project is emerging as a key landholding in an underexplored lithium province first identified by Delta Lithium (ASX: DLI, previously Red Dirt Metals) – see ASX Release by Delta Lithium dated 28 September 2021 Mt Ida – A New Lithium Province. St George Mining Limited – Annual Report 2023 P 5 REVIEW OF OPERATIONS The geological setting of the pegmatites mapped at Mt Alexander is interpreted to be similar to the significant pegmatite-hosted lithium discovery made by Delta Lithium at its Mt Ida Project, approximately 15km south of Mt Alexander. Figure 2 – photos of pegmatite outcrop at Mt Alexander. Rock chip sampling has confirmed a geochemistry favourable for the presence of lithium pegmatite mineralisation. Field mapping of pegmatites at Mt Alexander has identified numerous pegmatites along a north-south corridor adjacent to the Copperfield Granite. The geochemsitry of rock chip samples from these pegmatites indicates fertility for lithium, caesium and tanatalum pegmatites. Assays for these samples include many results with high-grade lithium values of more than 1% Li2O and a peak value of 3.25% Li2O, 225ppm Cs2O, 53ppm Ta2O5 and 1.24% Rb. For further details of these rock chip samples see our ASX Release dated 7 November 2022 Drilling Intersects Pegmatites with Visible Lithium. St George Mining Limited – Annual Report 2023 P 6 REVIEW OF OPERATIONS St George increased its landholding across the highly prospective pegmatite corridor parallel to the Copperfield Granite with the 100% acquisition of Exploration Licence E29/1143 and application for Prospecting Licence P29/2680. The additional ground is contiguous with St George’s existing Mt Alexander tenure providing near- continuous coverage over 15km of the pegmatite corridor, plus the critical contact with the Copperfield Granite – the interpreted source of the mineralised pegmatites. Figure 3 – map showing the interpreted prospective LCT pegmatite corridor at Mt Alexander as well as the lithium projects along strike from St George’s Mt Alexander. MINERALISED PEGMATITES IDENTIFIED OVER A WIDE AREA AT JAILBREAK St George completed its first-ever lithium drilling during the December 2022 quarter. Drilling was focused on testing several lithium-bearing pegmatite outcrops and confirmed that the fertile pegmatites extend from surface up to depths of 200m. A second drill programme was completed in the first half of calendar year 2023 with 84 reverse-circulation (RC) drill holes for 10,020m and 4 diamond drill holes for 877.30m. In total, 74 drill holes were completed St George Mining Limited – Annual Report 2023 P 7 REVIEW OF OPERATIONS on exploration licence E29/962 (100% St George) and 14 drill holes on E29/638 (75% St George: 25% IGO) – mostly focused on the Jailbreak Prospect in the south-east of the Mt Alexander tenure. Assay results for the 2023 drill programme demonstrated the presence of lithium mineralised pegmatites that commence from or near surface and continue to depths of up to 300m below surface. High grades – up to 1.77% Li2O – were returned in the assays, highlighting the potential of the pegmatite system to host high-grade mineralisation. The widespread presence of anomalous lithium at Jailbreak is indicative of this area being part of a fractionated pegmatite system with potential for stronger mineralisation along strike and down dip from current drilling. As other recent drilling in the region has shown1, thick mineralised parts of the system commonly occur at depths of +200m below surface. There is only very limited drilling at this depth so far at Mt Alexander. Only 2km of the 15km-long prospective pegmatite corridor within St George’s tenements has been tested by drilling to date. The southern extension of the corridor, towards the Mt Bevan Project of the Hancock, Hawthorn and Legacy joint venture, continues for at least another 1.5km and will be a priority focus of further drilling. Figure 4 – photo of drill core from MAD214 completed in December 2022 which intersected 5m of pegmatites from 49.5m downhole. EARLY INDICATIONS OF LARGE-SCALE PEGMATITE INTRUSION MODEL Diamond drill hole MAD213 intersected a 120.8m continuous interval of pegmatite which occurs within a 225m zone comprising multiple pegmatites (the Manta pegmatite zone). 1 Delta Lithium Limited (ASX: DLI) – ASX Release dated 12 April 2023 Further Excellent Results from Mt Ida Drilling. St George Mining Limited – Annual Report 2023 P 8 REVIEW OF OPERATIONS Assays from the pegmatites intersected in MAD213 provide indications of a wide, multi-phase and locally fractionated pegmatite system which has potential to host lithium mineralisation. The K:Rb (potassium to rubidium) ratio derived from the assays for the Manta pegmatite zone in MAD213 highlights the prospectivity of this area. The ratio is an indicator of a fractionated pegmatite, where the pegmatite melt has evolved as it moves further form its source granite. A K:Rb ratio of less than 150 is a favourable indicator of fractionated pegmatites. The lower the K:Rb ratio, the more fractionated and prospective the pegmatites are interpreted to be. The K:Rb ratio for the Manta pegmatite zone had a mean value of 117. All but one of the metre assays within the 120m Manta pegmatite zone produced a favourable K:Rb ratio of less than 150. The Manta pegmatites appear to have intruded along a relatively flat, regional-scale structure. Major structures can create wide extensional/dilational openings for pegmatites to intrude and enable fractionation to occur to form large volume lithium deposits. The exceptional thickness of the Manta pegmatites and the association with an interpreted regional-scale structure shows some important similarities with other major lithium deposits in Western Australia. LCT pegmatites have already been intersected at Mt Alexander over a widespread area, giving further support for the potential of the thick pegmatites intersected at Manta representing a distal part of a larger lithium mineral system. MT ALEXANDER PROJECT – NICKEL-COPPER-PGEs All four shallow, high-grade nickel-copper sulphide discoveries in the Cathedrals Belt – Stricklands, Cathedrals, Investigators and Radar – remain open with potential for additional high-grade nickel-copper- PGE mineralisation to be delineated by further drilling. Three RC drill holes and two diamond drill holes were completed in the December 2022 quarter to test nickel targets. These drill holes intersected intervals of thick massive and semi-massive sulphides but no nickel sulphide mineralisation. Further geophysical surveys, including seismic surveys, are planned for Mt Alexander to assist in designing further drill targets for potential nickel-copper sulphide mineralisation. About the Mt Alexander Project: The Mt Alexander Project is located 120km south-west of the Agnew-Wiluna Belt, which hosts numerous world-class nickel deposits. The Project comprises seven granted exploration licences – E29/638, E29/548, E29/962, E29/954, E29/972, E29/1041 and E29/1143 – which are a contiguous package. An additional two exploration licences – E29/1093 and E29/1126 – are located to the south-west of the core tenement package. The Cathedrals, Stricklands, Investigators and Radar nickel-copper-cobalt-PGE discoveries are located on E29/638, which is held in joint venture by St George (75%) and IGO Limited (25%). St George is the Manager of the Project, with IGO retaining a 25% non-contributing interest (in E29/638 only) until there is a decision to mine. The Jailbreak Lithium Prospect is on E29/638 and E29/962. The Manta Lithium Prospect is on E29/638. With the exception of E29/638, all Project tenements are owned 100% by St George. St George Mining Limited – Annual Report 2023 P 9 REVIEW OF OPERATIONS LITHIUM STAR – Lithium Projects in WA St George’s wholly owned subsidiary, Lithium Star Pty Ltd (Lithium Star), entered into an acquisition agreement with Chariot Corporation Limited and Stallion Lithium Pty Ltd (together, the Seller) on 21 March 2023 to acquire 100% of a package of tenements in Western Australia (Acquisition Agreement). Completion of the acquisition occurred on 8 August 2023. The tenement package consists of 14 exploration licences – 13 granted and 1 in application – which comprise 7 distinct projects. Figure 5 shows the location of the 7 new projects – Split Rock Project, Buningonia Project, Buningonia North Project, Myuna Rocks Project, Ten Mile West Project, Carnamah Project and Lindville Project. The 14 exploration licences cover a total area of 653 sq km, and include land packages located along strike from high-grade lithium deposits and established spodumene producing lithium mines – as illustrated in Figure 5. Figure 5 – map of the southern Yilgarn region showing St George’s recently acquired lithium projects as well as major lithium mines and deposits. St George Mining Limited – Annual Report 2023 P 10 REVIEW OF OPERATIONS The following new lithium projects will be prioritised for exploration: ◆ ◆ ◆ the Split Rock Project, located ~25km north-west of the Earl Grey lithium deposit, which has a resource of 189Mt @ 1.50% Li2O2 and is owned by Covalent Lithium – a joint venture between Wesfarmers (ASX: WES) and SQM (NYSE: SQM) the Buningonia and Buningonia North Projects, located in the same lithium province as Global Lithium’s (ASX: GL1) Manna Project and the Bald Hill Mine the Myuna Rocks Project, located near Allkem’s (ASX: AKE) operating Mt Cattlin Mine Figure 6 – map showing the regional location of the Spilt Rock Project, to the north of the large Earl Grey Lithium deposit. 2 Wesfarmers Proposal to acquire Kidman Resources - Briefing presentation 02 May 2019 St George Mining Limited – Annual Report 2023 P 11 REVIEW OF OPERATIONS Figure 7 – map showing the location of the Myuna Rocks tenements, highlighting the nearby Mt Cattlin lithium mine and the large landholding of Fortescue Metals Group (ASX: FMG). WOOLGANGIE PROJECT The Woolgangie Project is another example of St George’s corporate strategy to identify high-leverage greenfields critical minerals projects in Tier 1 jurisdictions. A pipeline of high priority targets – including lithium, rare earths and copper – has already been identified at Woolgangie and provide an opportunity for St George to use advanced, modern exploration techniques to explore for economic mineralisation. The Project area encompasses 3,350 sq km, representing a rare, district-scale opportunity in a historically fertile mineral field. St George acquired an option over 9 tenements – 7 granted Exploration Licences and 2 in application as announced in the ASX Release dated 2 February 2023 Acquisition of Critical Metals Project. In addition, St George has applied for a further 13 Exploration Licences – many of which are contiguous. St George owns 100% of the Project. St George Mining Limited – Annual Report 2023 P 12 REVIEW OF OPERATIONS Figure 8 – map showing the regional location of the Woolgangie Project. The Project tenements cover three strategic areas – the Central Tenements, the Eastern Tenements and the Western Tenements. The Central Tenements encompass approximately 90km of strike along the highly prospective Ida Fault – a major crustal boundary that controls multiple major mineral deposits within Western Australia. Significant lithium deposits along the Ida Fault include the Mt Ida Project (MRE: 12.7 Mt @ 1.2% Li2O)3 of Delta Lithium (ASX: DLI) and the Kathleen Valley Project (MRE: 156Mt at 1.4% Li2O and 130ppm Ta2O5)4 of Liontown Resources (ASX: LTR). The Eastern Tenements are proximal to an established lithium region that hosts several significant lithium deposits and operating mines. 3 Red Dirt Metals ASX release dated 19 October 2022 “Maiden Lithium Mineral Resource Estimate at Mt Ida” 4 Liontown Resources Limited release dated 11 November 2021 “Kathleen Valley DFS confirms Tier-1 global lithium project” St George Mining Limited – Annual Report 2023 P 13 REVIEW OF OPERATIONS These include the Mt Marion mine (71.3Mt @ 1.37% Li2O) of Mineral Resources (ASX: MIN)5, the Buldania deposit (15Mt @ 1.0% Li2O)6 of Liontown (ASX: LTR), the Bald Hill mine (26Mt @ 1% Li2O)7, the Pioneer Dome deposit (11.2Mt @ 1.21% Li2O)8 being acquired by Develop (ASX: DVP) and the Kangaroo Hills Lithium project of Future Battery Minerals (ASX: FBM). The Western Tenements cover ground with a geological se�ng interpteted to be favourable for REE mineralisa�on. Given the positive historical results in the area, the large land acquisition by St George presents a ‘first-mover’ strategy for REE in the region. AJANA PROJECT St George generated 2 priority drill targets following detailed airborne magnetic and ground gravity surveys over two areas of interest at the 100%-owned Ajana Project. Two large-scale targets were identified and prioritised for testing in the maiden drill programme that was carried out in 2023; see Figure 9. Figure 9 – map of the Ajana priority exploration licences with airborne magnetics data acquired by St George set against regional magnetics. The two prospect areas tested in the maiden drill programme are shown. 5 Mineral Resources (MIN) Mt Marion Mineral Resource Update - ASX Release 31 Oct 2018 6 Liontown Resources (LTR) Potential new drill targets defined at Buldania - ASX Release 15 Jul 2021 7 Bald Hill Mine - Lithium Ore Reserve Increase of 105% at Bald Hill, Tawana - ASX Release 6 June 2018 8 Essential Metals (ESS) Dome North Resource upgrade - ASX Release 20 Dec 2022 St George Mining Limited – Annual Report 2023 P 14 REVIEW OF OPERATIONS The targets are located adjacent to major regional-scale structures and present as co-incident magnetic and gravity anomalies interpreted to have potential to be associated with significant mineralisation. Target 1 is a 25km-long magnetic feature and has been named the Perseverant Prospect. Target 2 is a 2km-long ‘plug-like’ magnetic anomaly which is interpreted to be an intrusion and has been named the Catalina Prospect. St George’s first ever drill programme at Ajana comprised 12 RC holes with assays confirming that 8 of these intersected either high-grade or anomalous zinc and lead mineralisation using a cut-off of 0.5% Zn + Pb. The assays for the 4 diamond holes completed were pending at the time of publication of this Annual Report. The Ajana Project is located 500km north of Perth in the Northampton Mineral Field and near the western margin of the Yilgarn Craton. The Project comprises three granted Exploration Licences (E70/5521, E70/5522 and E70/6142) and four applications for Exploration Licences (E70/6260, E70/6259, E66/127 and E70/6199) which form a contiguous landholding covering 1,750 sq km. All tenements are 100% owned by St George Mining Ltd. A large number of vein-hosted base metal deposits dominated by high-grade lead, zinc and copper sulphides were mined over a broad area at Northampton between 1850 to 1973. A major reason for the lack of historical exploration in the Ajana area is the absence of exposure at surface of the Proterozoic base metal host sequence, with a thin layer of the Tumblagooda Formation sandstone (‘cover sequence’) unconformably overlying the Proterozoic host sequence. St George is deploying modern geophysics to see beneath the cover and investigate the potential for blind mineral deposits. A further drill programme at Ajana will be designed once all assays for the maiden drill programme are received and assessed. PATERSON PROJECT St George’s maiden diamond drilling campaign at the 100%-owned Paterson Project, in WA's north- eastern Pilbara region, provided strong encouragement for the potential of significant copper-gold mineralisation at the Project. Drill results confirmed evidence of hydrothermal/mineralising processes with strong alteration associated with intrusions prospective for orogenic style gold mineralisation. Accumulations of stratiform-hosted sulphides were also observed throughout the Project area in proximity to structures and intrusions providing support for the potential of the Project to host copper and potentially gold mineralisation. late-stage felsic Figure 10 – core from 236m depth within PDD002 completed at the Paterson Project showing disseminated and semi-massive sulphide as void infill within strongly altered breccia. St George Mining Limited – Annual Report 2023 P 15 REVIEW OF OPERATIONS Further exploration is planned for the Paterson Project to assist in identifying further targets for drilling. An IP survey over the priority prospect areas is planned in the second half of 2023 with the aim of identifying chargeable bodies that may represent mineral deposits. Figure 11 – map showing the location and regional geology of the Paterson Project and surrounding areas which are known to host significant mineral deposits. BROADVIEW PROJECT Stakeholder engagement is continuing with private landowners at the Broadview Project. The Project is located in the Wheatbelt 120km south-east of Perth, near the town of Brookton. The granted exploration licences cover two, approximately parallel 25km long north-east trending strongly magnetic features. These are interpreted to potentially represent two large mafic/ultramafic intrusions that may be prospective for Ni-Cu-PGEs. These unusual magnetic features cross-cut the regional north-west trending geology and appear to be linked to the craton-scale domain boundary interpreted at the eastern end of the licences (Figure 12). Other tenement holders in the region include global mining major Anglo American plc (LSE: AAL), which has more than 10,000 sq km of ground, and Impact Minerals (ASX: IPT) which has established its Arkun Project with five tenements. St George Mining Limited – Annual Report 2023 P 16 REVIEW OF OPERATIONS Figure 12 – map of the Broadview Project tenements overlaying magnetic data and highlighting interpreted greenstones. St George completed widely spaced auger soil sampling along existing roads within the licences. This preliminary soil survey identified locally elevated Ni and Cu results. CORPORATE DEVELOPMENTS Successful capital raising: November 2022: On 29 November 2022, the Company announced that commitments to raise $7.2 million had been received from investors for a placement of new shares at $0.068 per share (“November Placement”). These commitments included a $2,040,000 cornerstone investment by global battery minerals company, Shanghai Jayson New Energy Materials Co., Ltd (“Jayson”). A total of 105,941,190 ordinary shares were issued on 7 December 2022 under the November Placement. Subscribers under the November Placement were also offered one (1) free-attaching option for every five (5) shares subscribed for and issued under the November Placement, with the options having an exercise price of $0.10 and an expiry date of three years from their date of issue (“Options”). An Options Prospectus was issued on 8 December 2022 and the new Options, having an expiry of 13 December 2025, were issued on 13 December 2022. The Options are quoted on the ASX under code SGQO. St George Mining Limited – Annual Report 2023 P 17 REVIEW OF OPERATIONS December 2022: On 21 December 2022, the Company announced that Hongkong Xinwei Electronic Co., Limited, a wholly-owned subsidiary of Sunwoda Electronic Co., Ltd (“Sunwoda”) – a leading global lithium-ion battery maker – had agreed to invest $2 million in St George by way of a placement of new shares at $0.086 per share (“December Placement”). A total of 23,255,814 ordinary shares were issued under the December Placement on 5 January 2023. COMPETENT PERSON STATEMENT: The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves for the Mt Alexander Project is based on information compiled by Mr Dave Mahon, a Competent Person who is a Member of The Australasian Institute of Geoscientists. Mr Mahon is employed by St George Mining Limited to provide technical advice on mineral projects, and he holds performance rights issued by the Company. Mr Mahon has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Mahon consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. This ASX announcement contains information extracted from the following reports which are available on the Company’s website at www.stgm.com.au: • • • • • • • • • • • • • • • • • • • • • • • • • 3 May 2022 Step Up in Exploration for St George 25 May 2022 St George Commences Drilling at the Paterson 23 June 2022 Exploration Update for St George Mining 13 July 2022 Drilling Update for Paterson Project 1 September 2022 New Nickel Targets at Mt Alexander 7 September 2022 Significant Lithium Potential at Mt Alexander 20 September 2022 Significant Expansion of Lithium Potential 5 October 2022 Nickel Targets Confirmed at Mt Alexander 12 October 2022 High-Grade Lithium Confirmed at Mt Alexander 25 October 2022 Lithium Drilling Underway at Mt Alexander 4 November 2022 Drilling Intersects Pegmatites with Visible Lithium 7 November 2022 St George Increases Lithium Landholding 30 November 2022 St George Signs MoU with Global battery Investor 8 December 2022 St George Signs MoU with Global Battery Giant - SVOLT 21 December 2022 More Positive Lithium Results at Mt Alexander 21 December 2022 Strategic Investment in St George 6 February 2023 Lithium Exploration Commences at Mt Alexander 21 February 2023 Lithium Drilling Underway at Mt Alexander 29 March 2023 121 Metre Pegmatite Intersected at Mt Alexander 29 May 2023 Mt Alexander Lithium Exploration Update 3 July 2023 Maiden Drilling of Ni-Cu-PGE targets at Ajana 5 July 2023 Lithium Results for Mt Alexander 8 August 2023 Acquisition of Strategic Lithium Projects 5 September 2023 Base Metals Discovered at Ajana 11 September 2023 Exploration Commences at Woolgangie St George Mining Limited – Annual Report 2023 P 18 REVIEW OF OPERATIONS The Company confirms that it is not aware of any new information or data that materially affects the exploration results included in any original market announcements referred to in this report and that no material change in the results has occurred. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcements. FORWARD LOOKING STATEMENTS: This report includes forward-looking statements that are only predictions and are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of St George, the directors and the Company’s management. Such forward-looking statements are not guarantees of future performance. Examples of forward-looking statements used in this report includes use of the words ‘may’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, or ‘intends’ and other similar words that involve risks and uncertainties. These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of report, are expected to take place. Actual values, results, interpretations or events may be materially different to those expressed or implied in this report. Given these uncertainties, recipients are cautioned not to place reliance on forward-looking statements in the report as they speak only at the date of issue of this report. Subject to any continuing obligations under applicable law and the ASX Listing Rules, St George does not undertake any obligation to update or revise any information or any of the forward-looking statements in this report or any changes in events, conditions or circumstances on which any such forward-looking statement is based. This report has been prepared by St George Mining Limited. The document contains background Information about St George Mining Limited current at the date of this report. The report is in summary form and does not purport to be all inclusive or complete. Recipients should conduct their own investigations and perform their own analysis in order to satisfy themselves as to the accuracy and completeness of the information, statements and opinions contained in this report. The report is for information purposes only. Neither this report nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. The report may not be distributed in any jurisdiction except in accordance with the legal requirements applicable in such jurisdiction. Recipients should inform themselves of the restrictions that apply to their own jurisdiction as a failure to do so may result in a violation of securities laws in such jurisdiction. This report does not constitute investment advice and has been prepared without taking into account the recipient’s investment objectives, financial circumstances or particular needs and the opinions and recommendations in this report are not intended to represent recommendations of particular investments to particular persons. Recipients should seek professional advice when deciding if an investment is appropriate. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments. To the fullest extent of the law, St George Mining Limited, its officers, employees, agents and advisers do not make any representation or warranty, express or implied, as to the currency, accuracy, reliability or completeness of any information, statements, opinion, estimates, forecasts or other representations contained in this report. No responsibility for any errors or omissions from the report arising out of negligence or otherwise is accepted. St George Mining Limited – Annual Report 2023 P 19 DIRECTORS’ REPORT The Directors of St George Mining Limited submit the annual financial report of St George Mining Limited from 1 July 2022 to 30 June 2023. In accordance with the provisions of the Corporations Act 2001, the Directors report as follows: DIRECTORS The names and particulars of the directors of the Company during the financial year ended 30 June 2023, and at the date of this report, are as follows. Directors were in office for the entire period unless otherwise stated. John Prineas B.EC LL.B F FIN Appointed Experience Executive Chairman 19 October 2009 John is a founding shareholder and director of St George Mining Limited. His involvement in the mining sector spans over 25 years with experience in commercial, legal and finance roles. Prior to establishing St George Mining, John was Chief Operating Officer and Country Head of Dresdner Bank in Sydney with a focus on project and acquisition finance for resources and infrastructure projects. John has Economics and Law degrees from the University of Sydney and commenced his career as a lawyer in Sydney with Allen, Allen & Hemsley. BMG Resources Limited (ASX:BMG) from October 2020 and American West Metals Limited (ASX: AW1) from December 2021. Not applicable. listed company Other current directorships Former listed directorships in the last three years John Dawson B.Com MBA INSEAD Non-Executive Director Appointed Experience 2 January 2019 Mr Dawson has over 30 years’ experience in the finance and mining sectors where he occupied very senior roles with global investment banks including Goldman Sachs and Dresdner Kleinwort Wasserstein. listed company Other current directorships Former listed directorships in the last three years Sarah Shipway CA, B.Com Appointed Experience At Goldman Sachs, Mr Dawson was a Managing Director of FICC (Fixed Income, Currency and Commodities) for Australia. At Dresdner Kleinwort Wasserstein, Mr Dawson was Global Head of Commodities as well as the Country Head for Australia. BMG Resources Limited (ASX:BMG) from October 2020. Not applicable. Non-Executive Director 11 June 2015 Sarah Shipway was appointed Non-Executive Director on 11 June 2015 and was appointed Company Secretary of St George Mining on 22 March 2012. Ms Shipway is Non-Executive Director/Company Secretary for Beacon Minerals Limited (ASX: BCN), Company Secretary for American West Metals Limited (ASX: AW1) and was previously Company Secretary for Cardinal Resources Limited (previously ASX/TSX: CDV). Ms Shipway has a Bachelor of Commerce from the Murdoch University and is a member of the Chartered Accountants Australia and New Zealand. St George Mining Limited – Annual Report 2023 P 20 DIRECTORS’ REPORT listed company Other current directorships Former listed directorships in the last three years COMPANY SECRETARY Beacon Minerals Limited (ASX: BCN) from June 2015. Not applicable. Sarah Shipway was appointed Company Secretary on 22 March 2012. For details relating to Sarah Shipway, please refer to the details on directors above. DIRECTORS’ INTERESTS At the date of this report the Directors held the following interests in St George Mining. Name Ordinary Shares John Prineas John Dawson Sarah Shipway 17,011,255 14,895,242 1,226,402 The Directors have no interest, whether directly or indirectly, in a contract or proposed contract with St George Mining Limited during the financial year. PRINCIPAL ACTIVITIES The principal activity of the Group is mineral exploration in Australia. RESULTS AND REVIEW OF OPERATIONS The results of the consolidated entity for the financial year from 1 July 2022 to 30 June 2023 after income tax was a loss of $10,727,765 (2022: $8,180,317). A review of operations of the consolidated entity during the year ended 30 June 2023 is provided in the “Review of the Operations” immediately preceding this Directors’ Report. LIKELY DEVELOPMENTS The Group will continue its mineral exploration and development activities over the next financial year with a focus on the Mt Alexander Project and the Paterson Project. Further commentary on planned activities over the forthcoming year is provided in the “Review of Operations”. The Board will continue to focus on creating value from the Group’s existing resource assets, as well as considering new opportunities in the resources sector to complement the Group’s current projects. SIGNIFICANT CHANGES IN STATE OF AFFAIRS There has not been any significant change in the state of affairs of the Group during the financial year, other than as noted in this financial report. ENVIRONMENTAL ISSUES The Group is aware of its environmental obligations with regards to its exploration activities and ensures that it complies with all applicable regulations when carrying out exploration work. St George Mining Limited – Annual Report 2023 P 21 DIRECTORS’ REPORT MATERIAL BUSINESS RISKS The Company’s activities are subject to numerous risks, mostly outside the Board’s and management’s control. These risks can be specific to the Company, common to the mining industry and common to the stock market. The key risks affecting the Company and potentially its future performance include, but are not limited to the below: Exploration Risk Future Funding Risk • • • Regulatory Risk • Availability of Equipment and Contractors • Key Personnel Risk • Macro-Economic Risk This is not an exhaustive list of risks faced by the Company or an investment in it. A discussion on each of these named risk factors is outlined below: Exploration Risk The success of the Company depends on the delineation of economically mineable reserves and resources, access to required development capital, movement in the price of commodities, securing and maintaining title to the Company’s exploration and mining tenements and obtaining all consents and approvals necessary for the conduct of its exploration activities. Exploration on the Company’s existing tenements may by unsuccessful, resulting in a reduction in the value of those tenements, diminution in the cash resources of the Company and possible relinquishment of the tenements. The exploration costs of the Company are based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. Accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the Company’s viability. If the level of operating expenditure required is higher than expected, the financial position of the Company may be adversely affected. The Company may also experience unexpected shortages or increases in the costs of consumables, spare parts and plant and equipment. Future Funding Risk The Company’s ongoing activities are expected to require further funding in the future. Any additional equity funding may be dilutive to shareholders and may be undertaken at lower prices than the current market price. Although the Directors believe that additional capital can be obtained, no assurances can be that appropriate capital or funding, if and when needed, will be available on the terms favourable to the Company or at all. If the Company is unable to obtain additional financing as needed, it may be required to reduce, delay or suspend its exploration activities and this could have a material adverse effect on the Group’s activities and could affect the Group’s ability to continue as a going concern. Regulatory Risk The Company’s operations are subject to various Commonwealth, State and local laws and plans, including those relating to mining, prospecting, development permit and industrial relations, environmental, land use, royalties, water, native title and cultural heritage, mine safety and occupational health. Approvals, licences and permits required to comply with such rules are subject to the discretion of the applicable government officials. No assurance can be given that the Company will be successful in maintaining such authorisations in full force and effect without modification or revocation. To the extent such approvals are required and not retained or obtained in a timely manner or at all, the Company may be curtailed or prohibited from continuing or proceeding with exploration. The Company’s business and results of operations could be adversely affected if applications lodged for exploration licences are not granted. Mining and exploration licence requirements, St George Mining Limited – Annual Report 2023 P 22 DIRECTORS’ REPORT tenements are subject to periodic renewal. The renewal of the term of a granted tenement is also subject to the discretion of the relevant Minister. Renewal conditions may include increased expenditure and work commitments or compulsory relinquishment of areas of the tenements comprising the Company’s projects. The imposition of new conditions or the inability to meet those conditions may adversely affect the operations, financial position and/or performance of the Company. It is also possible that, in relation to tenements which the Company has an interest in or will in the future acquire such an interest in, there may be areas over which legitimate common law native title rights of Aboriginal Australians exist. If native title rights do exist, the ability of the Company to gain access to tenements (through obtaining consent of any relevant landowner), or to progress from the exploration phase to the development and mining phases of operations may be affected. The Company may also be unable to obtain land access from landowners due to an inability to negotiate an agreement. Availability of Equipment and Contractors In the past few years various equipment and consumables, including drill rigs and drill bits, have been in short supply. There was also high demand for contractors providing other services to the mining industry. Consequently, there is a risk that the Company may not be able to source all the equipment and contractors required to fulfil its proposed activities. There is also a risk that hired contractors may underperform or that equipment may malfunction, either of which may affect the progress of the Company’s activities. Key Personnel Risk In formulating its exploration programs and business development strategies, the Company relies to a significant extent upon the experience and expertise of the Directors and management. A number of key personnel are important to attaining the business goals of the Company. One or more of these key employees could leave their employment, and this may adversely affect the ability of the Company to conduct its business and, accordingly, affect the financial performance of the Company and its share price. Recruiting and retaining qualified personnel are important to the Company’s success. The number of persons skilled in the exploration and development of mining properties is limited and competition for such persons is strong. Macro-Economic Risk At the present time global supply chains, labour and equipment shortages are ongoing. Inflationary pressures for appropriately skilled labour and capital items are being seen across many industries, including mining. DIVIDENDS PAID OR RECOMMENDED The directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend to the date of this report. DIRECTORS’ MEETINGS The following table sets out the number of meetings held during the year ended 30 June 2023 and the number of meetings attended by each director. J Prineas J Dawson S Shipway Directors Meetings Eligible to Attend 5 5 5 Attended 5 5 5 St George Mining Limited – Annual Report 2023 P 23 DIRECTORS’ REPORT REMUNERATION REPORT – AUDITED Remuneration policy The remuneration policy of St George Mining Limited has been designed to align directors’ objectives with shareholder and business objectives by providing a fixed remuneration component, which is assessed on an annual basis in line with market rates. The Board of St George Mining Limited believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best directors to run and manage the Company. The Board’s policy for determining the nature and amount of remuneration for Board members is as follows: • The remuneration policy and setting the terms and conditions for the Executive directors and other senior staff members is developed and approved by the Board based on local and international trends among comparative companies and industry generally. It examines terms and conditions for employee incentive schemes, benefit plans and share plans. Independent advice is obtained when considered necessary to confirm that executive remuneration is in line with market practice and is reasonable within Australian executive reward practices. • All executives receive a base salary (which is based on factors such as length of service and experience) and superannuation. • • • • The Group is an exploration entity, and therefore speculative in terms of performance. Consistent with attracting and retaining talented executives, directors and senior executives are paid market rates associated with individuals in similar positions within the same industry. Options and performance incentives may be issued particularly as the entity moves from an exploration to a producing entity and key performance indicators such as profit and production and reserves growth can be used as measurements for assessing executive performance. The Board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and responsibilities. The Executive Directors, in consultation with independent advisors, determine payments to the non-executives and review their remuneration annually, based on market practice, duties and accountability. The maximum aggregate amount of fees that can be paid to non- executive directors is subject to approval by shareholders at the Annual General Meeting and is currently $500,000 per annum. Fees for independent non-executive directors are not linked to the performance of the Group. To align Directors’ interests with shareholder interests, the directors are encouraged to hold shares in the Company. The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives. The method applied to achieve this aim has been the issue of performance rights to directors and executives to encourage the alignment of personal and shareholder interests. The Company believes this policy was effective in increasing shareholder wealth in the past. The Company has issued performance-based remuneration to directors and executives of the Company. The measures are specifically tailored to align personal and shareholder interest. The KPI’s are reviewed regularly to assess them in relation to the Company’s goals and shareholder wealth. St George Mining Limited – Annual Report 2023 P 24 DIRECTORS’ REPORT Company Performance A summary of St George Mining’s business performance as measured by a range of financial and other indicators, including disclosure required by the Corporations Act 2001, is outlined below. Total Comprehensive Loss Attributable to Member of the Company ($) Cash and cash equivalents at year end ($) Basic Loss Per Share (cents) ASX share price at the end of the year ($) Increase/(decrease) in share price (%) 2023 2022 2021 2020 2019 10,727,765 8,180,317 8,322,413 8,584,901 9,594,528 3,337,581 1.38 0.040 29 4,103,089 1.33 0.031 (54) 6,370,756 1.61 0.067 (42) 8,310,582 2.12 0.115 5 3,357,486 3.21 0.110 (18) Remuneration Consultants No remuneration consultant was engaged in the current financial year. Details of directors and executives Directors J Prineas J Dawson S Shipway Title Executive Chairman Non-Executive Director Non-Executive Director Date of Appointment 19 October 2009 2 January 2019 11 June 2015 Date of Retirement Not Applicable Not Applicable Not Applicable The Company does not have any executives that are not Directors. Executive Directors’ remuneration and other terms of employment are reviewed annually by the non-executive director(s) having regard to performance against goals set at the start of the year, relative comparable information and independent expert advice. Except as detailed in the Director’s Report, no director has received or become entitled to receive, during or since the financial year end, a benefit because of a contract made by the Group or a related body corporate with a director, a firm of which a director is a member or an entity in which a director has a substantial financial interest. This statement excludes a benefit included in the aggregate amount of emoluments received or due and receivable by directors and shown in the Remuneration Report, prepared in accordance with the Corporations Regulations, or the fixed salary of a full time employee of the Group. Director Remuneration Tables The actual remuneration earned by Directors in FY2023 is set out below. The information is considered relevant as it provides shareholders with a view of the remuneration actually paid to Directors for performance in FY2023. The value of remuneration includes equity grants where the Directors received control of the shares in FY2023 and different from the remuneration disclosures in the below table, which disclosures the value of LTI grants which may or may not vest in future years. St George Mining Limited – Annual Report 2023 P 25 DIRECTORS’ REPORT Director Actual Remuneration Earned in FY2023 Short- Term Incentive $ - - - Salary and Fees 1 Termination Payment LTI Plan Rights Total Actual Remuneration Name J Prineas J Dawson S Shipway 1. Salary and fees comprise base salary, superannuation and leave entitlements. It reflects the total of “salary $ 386,750 69,018 157,417 $ 386,750 69,018 157,417 $ - - - $ - - - and fees” and “superannuation” in the statutory remuneration table. Remuneration of directors and executives Remuneration for the financial year ended 30 June 2023. Short-Term Benefits Post Employment Benefits Salary and Fees $ 350,000 350,000 62,460 62,460 157,417 156,705 569,877 569,165 Directors J Prineas 2023 2022 J Dawson 2023 2022 S Shipway 2023 2022 Total 2023 2022 Termination Payment Superann- uation $ - - - - - - - - $ 36,750 35,000 6,558 6,245 - - 43,308 41,245 Employee Benefits Long Service and Annual Leave $ Equity Settled Share-Based Payments Shares/Option/ Performance Rights $ Total Performance Related $ % 7,369 20,908 - - 3,283 23,232 10,652 44,140 56,147 (33,870) 14,037 (19,662) 14,037 (25,040) 84,221 (78,572) 450,266 372,038 83,055 49,043 174,737 154,897 708,058 575,978 - - - - - - - - Employment contracts of directors and executives The terms and conditions under which key management personnel and executives are engaged by the Company are formalised in contracts between the Company and those individuals. The Company has entered into an executive services agreement with Mr John Prineas whereby Mr Prineas receives remuneration of $350,000 per annum plus statutory superannuation. Mr Prineas or the Company may terminate the agreement by giving 12 months’ notice. The executive services agreement has no fixed period and continues until terminated. The Company has entered into a services agreement with Mr John Dawson, whereby Mr Dawson receives remuneration of $62,460 per annuum plus statutory superannuation. Mr Dawson or the Company may terminate the agreement by giving notice. The services agreement has no fixed period and continues until terminated. The Company has entered into service agreements with Ms Sarah Shipway whereby Ms Shipway receives remuneration of $62,460 per annum plus statutory superannuation and $80,000 plus statutory superannuation for the roles of Non-Executive Director and Company Secretary respectively. Ms Shipway may terminate the St George Mining Limited – Annual Report 2023 P 26 DIRECTORS’ REPORT agreements by giving 3 months’ notice. The services agreements have no fixed period and continue until terminated. INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS In accordance with the constitution, except as may be prohibited by the Corporations Act 2001, every Officer or agent of the Company shall be indemnified out of the property of the entity against any liability incurred by him/her in his/her capacity as Officer or agent of the Company or any related corporation in respect of any act or omission whatsoever and howsoever occurring or in defending any proceedings, whether civil or criminal. Shareholdings of key management personnel Directors Balance at 1 July 2022 Granted as remuneration Net other change Balance at 30 June 2023 J Prineas J Dawson S Shipway Total 17,011,255 14,985,242 1,226,402 33,222,899 - - - - - - - - 17,011,255 14,985,242 1,226,402 33,222,899 Performance Options holdings of key management personnel Directors Balance at 1 July 2022 Granted as remuneration Net other change Balance at 30 June 2023 Unvested J Prineas J Dawson S Shipway Total - - - - 8,000,000 2,000,000 2,000,000 12,000,000 - - - - 8,000,000 2,000,000 2,000,000 12,000,000 8,000,000 2,000,000 2,000,000 12,000,000 Value of unvested Rights ($) 56,147 14,037 14,037 84,221 Each performance option converts to fully paid ordinary shares on achievement of certain milestones. Performance Rights Plan The Group operates a Performance Rights and Options Plan, approved at the Company’s Annual General Meeting held 9 November 2022. During the year ended 30 June 2023 the Company issued 22,500,000 performance options (2022: Nil). At the date of this report there were 24,500,000 performance options on issue. There were no ordinary shares issued during the financial year from the exercise of the performance options. END OF REMUNERATION REPORT SHARE OPTIONS Unissued shares At the date of this report the Company had 39,188,238 listed options on issue. St George Mining Limited – Annual Report 2023 P 27 DIRECTORS’ REPORT At the date of this report the Company had on issue the below unlisted options: Unlisted Options Class Grant Date Unlisted Options Class A Performance Options* Class B Performance Options* Class C Performance Options* Class D Performance Options* Class A Performance Options* Class B Performance Options* Class C Performance Options* Class D Performance Options* Class A Performance Options* Class B Performance Options* Class C Performance Options* Class D Performance Options* 24.03.2022 29.09.2022 29.09.2022 29.09.2022 29.09.2022 16.03.2023 16.03.2023 16.03.2023 16.03.2023 31.07.2023 31.07.2023 31.07.2023 31.07.2023 *Options vest on certain milestones being achieved. Number of Options 5,000,000 2,250,000 2,250,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 500,000 500,000 500,000 500,000 Exercise Price $ Expiry Date $0.095 - - - - - - - - - - - - 24.03.2024 31.12.2024 31.12.2025 31.12.2025 30.06.2026 31.12.2024 31.12.2025 31.12.2025 30.06.2026 31.12.2024 31.12.2025 31.12.2025 30.06.2026 During the financial year ended 30 June 2023, and at the date of this report, none of these unlisted options were converted into fully paid ordinary shares. Option holders do not have any rights to participate in any issues of shares or other interests in the Company or any other entity. PROCEEDINGS ON BEHALF OF THE COMPANY No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year. CORPORATE GOVERNANCE STATEMENT St George Mining is committed to ensuring that its policies and practices reflect a high standard of corporate governance. The Board has adopted a comprehensive framework of Corporate Governance Guidelines. Throughout the 2023 financial year the Company’s governance was consistent with the Corporate Governance Principles and Recommendations (4th edition) published by the ASX Corporate Governance Council. The Group’s Corporate Governance Statement can be viewed at www.stgm.com.au. EVENTS SUBSEQUENT TO BALANCE DATE On 8 August 2023 the Company advised that it had completed the acquisition of seven lithium prospective projects located in Western Australia that was announced previously on 22 March 2023. The Company paid $300,000 (plus GST) in cash upon completion and $400,000 (plus GST) worth of St George shares, being 6,064,435 shares, on completion. As part of the consideration the below is payable: 1. Resource Milestone Payment: 15,000,000 fully paid ordinary shares in St George (Milestone Shares) if St George announces a JORC 2012 compliant Inferred Mineral Resource at a Lithium Project of not less than 10,000,000 tonnes of Li20 with a minimum grade of 1% Li20 (using a cut-off grade of no less than 0.5%) (Milestone) prior to the date which is five years from completion of the acquisition (Milestone End Date). St George Mining Limited – Annual Report 2023 P 28 DIRECTORS’ REPORT • With respect to each Lithium Project, the issue of any Milestone Shares is subject to shareholder approval. If that shareholder approval is not obtained then St George will pay Chariot Corporation the amount in cash which is equal to the value 15,000,000 fully paid ordinary shares in St George multiplied the VWAP of the shares for the 15 trading days before the date that the relevant Milestone was satisfied. A Resource Milestone Payment is payable in regard to each Lithium Project upon the first time the Milestone is satisfied for that Project. If the Milestone for a Lithium Project is not met prior to the Milestone End Date, St George may elect to either make the Milestone Payment to the Seller or otherwise St George must transfer the applicable tenements for that Lithium Project back to the Seller for consideration of $1. • 2. A 2% net smelter royalty will be retained by Chariot in respect of any mineral products produced and sold from any of the Lithium Projects. St George will have the right to buy back half of the royalty in respect of a Lithium Project by paying $5,000,000 cash to Chariot at any time prior to first commercial production from that Lithium Project. On 31 July 2023 the Company announced the issue of 2,000,000 performance rights to an employee of the Company. On 15 September 2023 the Company incorporated Lithium Blue Pty Ltd, a fully owned subsidiary company of St George Mining Limited. Other than the above there have been no matters or circumstances that have arisen since the end of the financial year which significantly affected or could significantly affect the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial years. AUDITOR’S INDEPENDENCE DECLARATION The auditor’s independence declaration for the year ended 30 June 2023 has been received and can be found on page 61 of the financial report. Non Audit Services The Company’s auditor, Stantons, did not provide any non-audit services to the Company during the financial year ended 30 June 2023. Signed in accordance with a resolution of the directors made pursuant to s 298(2) of the Corporations Act 2001. On behalf of the directors JOHN PRINEAS Executive Chairman St George Mining Limited Dated 28 September 2023 St George Mining Limited – Annual Report 2023 P 29 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2023 Australian Dollar ($) REVENUE Interest Other income EXPENDITURE Administration expenses Exploration expenditure written off Finance expenses LOSS BEFORE INCOME TAX Note 30 JUNE 2023 $ 30 JUNE 2022 $ 3 3 4 5 6 82,226 65,553 147,779 (2,445,351) (8,410,748) (19,445) (10,727,765) 4,360 74,053 78,413 (1,402,299) (6,841,630) (14,801) (8,180,317) Income Tax 7(a) - - NET LOSS ATTRIBUTABLE TO MEMBERS OF THE COMPANY (10,727,765) (8,180,317) Other comprehensive income TOTAL COMPREHENSIVE INCOME (LOSS) - (10,727,765) - (8,180,317) TOTAL COMPREHENSIVE LOSS ATTRIBUTABLE TO MEMBERS OF THE COMPANY (10,727,765) (8,180,317) LOSS PER SHARE Basic and diluted – cents per share 16 (1.38) (1.33) The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes St George Mining Limited – Annual Report 2023 P 30 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023 Australian Dollar ($) Note 30 JUNE 2023 $ 30 JUNE 2022 $ CURRENT ASSETS Cash and cash equivalents Trade and other receivables Other assets TOTAL CURRENT ASSETS NON CURRENT ASSETS Security bond Right of use assets Plant and equipment TOTAL NON CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Lease Liabilities Provisions for employee entitlements TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Lease liabilities TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses TOTAL EQUITY 17(a) 10(a) 10(b) 11(a) 12 13 11(b) 11(b) 3,337,581 32,306 123,060 3,492,947 71,748 310,407 30,862 413,017 4,103,089 73,236 124,434 4,300,759 71,682 333,064 40,081 444,827 3,905,964 4,745,586 1,498,083 90,704 260,034 1,848,821 237,168 237,168 1,294,595 82,070 238,555 1,615,220 261,544 261,544 2,085,989 1,876,764 1,819,975 2,868,822 14(a) 14(b) 15 71,593,685 1,321,022 (71,094,732) 1,819,975 62,739,363 496,426 (60,366,967) 2,868,822 The above consolidated statement of financial position should be read in conjunction with the accompanying notes St George Mining Limited – Annual Report 2023 P 31 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2023 Australian ($) BALANCE AT 1 JULY 2022 Loss for the year Other comprehensive income Total comprehensive loss Shares issued during the year Shares based payments Reversal of performance rights Share issue expenses BALANCE AT 30 JUNE 2023 BALANCE AT 1 JULY 2021 Loss for the year Other comprehensive income Total comprehensive loss Shares issued during the year Share based payments – employees/directors Shares based payments Options exercised during the year BALANCE AT 30 JUNE 2022 SHARE CAPITAL $ 62,739,363 - - - 9,204,001 838,748 - (1,188,427) 71,593,685 ACCUMULATED LOSSES $ (60,366,967) (10,727,765) - (10,727,765) - - - - (71,094,732) 57,336,331 - - - 5,763,000 - - (359,968) 62,739,363 (52,186,650) (8,180,317) - (8,180,317) - - - - (60,366,967) RESERVES $ TOTAL EQUITY $ 496,426 - - - - 824,596 - - 1,321,022 658,425 - - - - 349,501 (511,500) - 496,426 2,868,822 (10,727,765) - (10,727,765) 9,204,001 1,663,344 - (1,188,427) 1,819,975 5,808,106 (8,180,317) - (8,180,317) 5,763,000 349,501 (511,500) (359,968) 2,868,822 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes St George Mining Limited – Annual Report 2023 P 32 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2023 Australian Dollar ($) CASH FLOWS FROM OPERATING ACTIVITIES Expenditure on mining interests Payments to suppliers and employees Interest received Other Net cash outflow from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Payment of bank guarantee Purchase of plant and equipment Acquisition of tenements Net cash outflow from investing activities CASH FLOW FROM FINANCING ACTIVITIES Issue of shares net of capital raising costs Lease payments including interest Net cash inflows from financing activities Note 30 JUNE 2023 $ 30 JUNE 2022 $ 17(b) (5,992,893) (2,969,292) 74,022 134,122 (8,754,041) - (7,152) (560,480) (567,632) 8,664,374 (108,209) 8,556,165 (5,004,068) (2,485,672) 6,874 28,882 (7,453,984) (2,022) (27,542) - (29,564) 5,303,032 (87,151) 5,215,881 Net (decrease) in cash and cash equivalents (765,508) (2,267,667) Cash and cash equivalents at the beginning of the financial year CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR 4,103,089 6,370,756 17(a) 3,337,581 4,103,089 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes St George Mining Limited – Annual Report 2023 P 33 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 1 CORPORATE INFORMATION The financial report of St George Mining Limited (“St George Mining” or “the Company”) for the year ended 30 June 2023 was authorised for issue in accordance with a meeting of the directors on 28 September 2023. St George Mining Limited is a company limited by shares, incorporated in Australia on 19 October 2009. The consolidated financial statements of the Company for year ended 30 June 2023 comprise of the Company and its subsidiaries together referred to as the Group or consolidated entity. The nature of the operations and principal activity of the Group is mineral exploration. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Statement of compliance The financial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (“AIFRS”). Compliance with AIFRS ensures that the financial report, comprising the financial statements and notes thereto, complies with International Financial Reporting Standards (“IFRS”). (b) Basis of Preparation of the Financial Report The financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001, Accounting Standards and Interpretations and complies with other requirements of the law. The financial report has also been prepared on a historical cost basis. The financial report is presented in Australian dollars. The following accounting policies have been adopted by the consolidated entity. Going Concern The directors have prepared the financial statements on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of business. The Consolidated Entity has recorded a net accounting loss of $10,727,765 and net operating cash outflows of $8,754,041 for the year ended 30 June 2023. The net assets of the consolidated entity have decreased from $2,868,822 at 30 June 2022 to net assets of $1,819,975 as at 30 June 2023. Net assets and Shareholder’s equity decreased in 2023 due to an increase in expenditure during the period of $2,547,448. At 30 June 2023 the Group held a cash balance of $3,337,581. Equity raisings or debt financing arrangements will be required in the future to fund the Group’s activities. The Directors are assessing a number of options in respect of equity and debt financing arrangements, and have reasonable expectations that further funding will be arranged to meet the Group’s objectives. There is no certainty that new funding will be successfully completed to provide adequate working capital for the Group. The Board is confident that the Group will have sufficient funds to finance its operations in the 2023/2024 year following successful completion of equity raisings or debt financing arrangements. St George Mining Limited – Annual Report 2023 P 34 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (c) Principles of Consolidation The consolidated financial statements incorporate all of the assets, liabilities and results of the parent St George Mining Limited and all of the subsidiaries. Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. A list of the subsidiaries is provided in Note 22. The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Group from the date on which control is obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control ceases. Intercompany transactions, balances and unrealised gains or losses on transactions between Group entities are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Group. Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as “non controlling interests". The Group initially recognises non-controlling interests that are present ownership interests in subsidiaries and are entitled to a proportionate share of the subsidiary's net assets on liquidation at either fair value or at the non-controlling interests' proportionate share of the subsidiary's net assets. Subsequent to initial recognition, non-controlling interests are attributed their share of profit or loss and each component of other comprehensive income. Non-controlling interests are shown separately within the equity section of the statement of financial position and statement of comprehensive income. (d) Significant accounting estimates and judgements The carrying amount of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are: Share-based payment transactions The Group measures the cost of equity-settled and cash-settled transactions by reference to the fair value of the goods or services received in exchange if it can be reliably measured. If the fair value of the goods or services cannot be reliably measured, the costs are measured by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using the Black-Scholes model and the assumptions and carrying amount at the reporting date, if any, are disclosed in note 18. Deferred taxation The potential deferred tax asset arising from the tax losses and temporary differences have not been recognised as an asset because recovery of the tax losses is not yet considered probable (refer note 7). Exploration costs The Group expenses all exploration and evaluation expenditure incurred. Subsidiary Loans Provision has been made for all unsecured loans with subsidiaries as it is uncertain if and when the loans will be recovered. All inter-company loans have been eliminated on consolidation. St George Mining Limited – Annual Report 2023 P 35 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (e) Revenue Under AASB 15 Revenue from contracts with customers, revenue is recognised when a performance obligation is satisfied, being when control of the goods or services underlying the performance obligations is transferred to the customer. Interest Interest revenue is recognised using the effective interest method. (f) Employee benefits Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits expected to be settled within one year together with entitlements arising from wages and salaries and annual leave which will be settled after one year, have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Other employee benefits payable later than one year have been measured at the present value of the estimated cash outflows to be made to those benefits. Contributions are made by the Group to employee superannuation funds and are charged as expenses when incurred. (g) Share based payment transactions The Group accounts for all equity-settled stock-based payments based on the fair value of the award on grant date. Under the fair value-based method, compensation cost attributable to options granted is measured at fair value at the grant date and amortised over the vesting period. The amount recognised as an expense is adjusted to reflect any changes in the Group’s estimate of the performance rights that will eventually vest and the effect of any non-market vesting conditions. Share-based payment arrangements in which the Group receives goods or services as consideration are measured at the fair value of the good or service received, unless that fair value cannot be reliably estimated. (h) Exploration and evaluation expenditure Exploration and evaluation expenditure on areas of interest are expensed as incurred. Costs of acquisition will normally be expensed but will be assessed on a case by case basis and may be capitalised to areas of interest and carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. When an area of interest is abandoned or the directors decide that it is not commercial, any accumulated acquisition costs in respect of that area are written off in the financial period the decision is made. Where projects have advanced to the stage that directors have made a decision to mine, they are classified as development properties. When further development expenditure is incurred in respect of a development property, such expenditure is carried forward as part of the cost of that development property only when substantial future economic benefits are established. Otherwise such expenditure is classified as part of the cost of production or written off where production has not commenced. St George Mining Limited – Annual Report 2023 P 36 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (i) Income Tax Current tax assets and liabilities for the period is measured at amounts expected to be recovered from or paid to the taxation authorities based on current year’s taxable income. The tax rates and tax laws used for computation are enacted or substantially enacted by the balance date. Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised for all taxable temporary differences: • • except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither that accounting profit nor taxable profit or loss; and, in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, except where the timing of the reversal of the temporary differences will not reverse in the foreseeable future. Deferred income tax assets are recognised for all the deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised: • • except where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and, in respect of deductible temporary differences with investments in subsidiaries, associates and interest in joint ventures, deferred tax assets in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised. The carrying amount of deferred income tax is reviewed at each balance sheet date and reduced to the extent that is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date. Income taxes relating to items recognised directly in equity are not in the income statement. (j) Goods and services tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (“ATO”). In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the consolidated Statement of Financial Position are shown inclusive of GST. The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the Consolidated Statement of Financial Position. Cash Flows are included in the Consolidated Statement of Cash Flows net of GST. The GST components of cash flows arising from investing and financial activities which are recoverable from, or payable to, the ATO are classified as operating cash flows. St George Mining Limited – Annual Report 2023 P 37 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (k) Plant and equipment Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is calculated on a diminishing value basis over the estimated useful life of the assets as follows: Class of Fixed Asset Plant and Equipment - Year 1 - Subsequent Years Depreciation Rate 18.75% 37.50% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each financial year end. (l) Earnings per share Basic earnings per share is calculated as net loss attributable to members of the Company, adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element. (m) Cash and cash equivalents Cash and short-term deposits in the consolidated Statement of Financial Position comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less. For the purposes of the consolidated Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts. (n) Impairment of assets The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of its fair value; less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets and the asset’s value in use cannot be estimated to be close to its fair value. In such cases the asset is tested for impairment as part of the cash- generating unit to which it belongs. When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired and it is written down to its recoverable amount. In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment losses relating to continuing operations are recognised in those expense categories consistent with the function of the impaired asset unless the asset is carried at revalued amount (in which case the impairment loss is treated as a revaluation decrease). An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation increase. After such a reversal the St George Mining Limited – Annual Report 2023 P 38 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systemic basis over its remaining useful life. (o) Contributed equity Ordinary shares and options are classified as contributed equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of GST, from the proceeds. (p) Financial Instruments Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the financial instrument. Financial instruments (except for trade receivables) are measured initially at fair value adjusted by transactions costs, except for those carried “at fair value through profit or loss”, in which case transaction costs are expensed to profit or loss. Where available, quoted prices in an active market are used to determine the fair value. In other circumstances, valuation techniques are adopted. Subsequent measurement of financial assets and financial liabilities are described below. Trade receivables are initially measured at the transaction price if the receivables do not contain a significant financing component in accordance with AASB 15. Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and all substantial risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires. Financial assets Except for those trade receivables that do not contain a significant financing component and are measured at the transaction price in accordance with AASB 15, all financial assets are initially measured at fair value adjusted for transaction costs (where applicable). For the purpose of subsequent measurement, financial assets other than those designated and effective as hedging instruments, are classified into the following categories upon initial recognition: • • • amortised cost; fair value through other comprehensive income (FVOCI); and fair value through profit or loss (FVPL). Classifications are determined by both: • • The contractual cash flow characteristics of the financial assets; and The entities business model for managing the financial asset. Financial assets at amortised cost Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated as FVPL): • • they are held within a business model whose objective is to hold the financial assets and collect its contractual cash flows; and the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. St George Mining Limited – Annual Report 2023 P 39 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 After initial recognition, these are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade and most other receivables fall into this category of financial instruments. Financial assets at fair value through other comprehensive income (Equity instruments) The Group measures debt instruments at fair value through OCI if both of the following conditions are met: • • The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding; and The financial asset is held within a business model with the objective of both holding to collect contractual cash flows and selling the financial asset. For debt instruments at fair value through OCI, interest income, foreign exchange revaluation and impairment losses or reversals are recognised in the statement of profit or loss and computed in the same manner as for financial assets measured at amortised cost. The remaining fair value changes are recognised in OCI. Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity instruments designated at fair value through OCI when they meet the definition of equity under AASB 132 Financial Instruments: Presentation and are not held for trading. Financial assets at fair value through profit or loss (FVPL) Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Financial liabilities Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs unless the Group designated a financial liability at fair value through profit or loss. Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for derivatives and financial liabilities designated at FVPL, which are carried subsequently at fair value with gains or losses recognised in profit or loss. All interest-related charges and, if applicable, gains and losses arising on changes in fair value are recognised in profit or loss. Effective interest rate method The effective interest rate method is a method of calculating the amortised cost of a financial instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument or, where appropriate, a shorter period, to the net carrying amount on initial recognition. St George Mining Limited – Annual Report 2023 P 40 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 Transaction costs Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Impairment of financial assets The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables. (q) Business combinations Business combinations occur where an acquirer obtains control over one or more businesses and results in the consolidation of its assets and liabilities. A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control. The acquisition method requires that for each business combination one of the combining entities must be identified as the acquirer (i.e. parent entity). The business combination will be accounted for as at the acquisition date, which is the date that control over the acquiree is obtained by the parent entity. At this date, the parent shall recognise, in the consolidated accounts, and subject to certain limited exceptions, the fair value of the identifiable assets acquired and liabilities assumed. In addition, contingent liabilities of the acquiree will be recognised where a present obligation has been incurred and its fair value can be reliably measured. The acquisition may result in the recognition of goodwill or a gain from a bargain purchase. The method adopted for the measurement of goodwill will impact on the measurement of any non-controlling interest to be recognised in the acquiree where less than 100% ownership interest is held in the acquiree. The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair value of any previously held equity interest shall form the cost of the investment in the separate financial statements. Consideration may comprise the sum of the assets transferred by the acquirer, liabilities incurred by the acquirer to the former owners of the acquiree and the equity interests issued by the acquirer. Fair value uplifts in the value of pre-existing holdings are taken to the statement of comprehensive income. Where changes in the value of such equity holdings had previously been recognised in other comprehensive income, such amounts are recycled to profit or loss. Included in the measurement of consideration transferred is any asset or liability resulting from a contingent consideration arrangement. Any obligation incurred relating to contingent consideration is classified as either a financial liability or equity instrument, depending upon the nature of the arrangement. Rights to refunds of consideration previously paid are recognised as a receivable. Subsequent to initial recognition, contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an asset or a liability is remeasured each reporting period to fair value through the statement of comprehensive income unless the change in value can be identified as existing at acquisition date. All transaction costs incurred in relation to the business combination are expensed to the consolidated statement of comprehensive income. St George Mining Limited – Annual Report 2023 P 41 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (r) Trade Receivables Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. They are generally due for settlement within 30 days and therefore are all classified as current. Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components, when they are recognised at fair value. The Group holds the trade receivables with the objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method. Details about the Group’s impairment policies and the calculation of the loss allowance are provided in note 2(n). (s) Trade and Other Payables Trade and other payables represent the liabilities for goods and services received by the Group that remain unpaid at the end of the reporting period. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability. Trade and other payables are initially measured at fair value and subsequently measured at amortised costs using the effective interest method. (t) Adoption of new and revised standards New and Amended Standards Adopted by the Group AASB 2020-3: Amendments to Australian Accounting Standards – Annual Improvements 2018–2020 and Other Amendments The Entity adopted AASB 2020-3 which makes some small amendments to a number of standards including the following: AASB 1, AASB 3, AASB 9, AASB 116, AASB 137 and AASB 141. The adoption of the amendment did not have a material impact on the financial statements. AASB 2021-7a: Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128 and Editorial Corrections. AASB 2020-7a makes various editorial corrections to a number of standards effective for reporting periods beginning on or after 1 January 2022. The adoption of the amendment did not have a material impact on the financial statements AASB 2020-8: Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2 New and Amended Accounting Policies Not Yet Adopted by the Entity • AASB 2020-1: Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-current The amendment amends AASB 101 to clarify whether a liability should be presented as current or non- current. The Group plans on adopting the amendment for the reporting period ending 30 June 2024 along with the adoption of AASB 2022-6. The amendment is not expected to have a material impact on the financial statements once adopted. • AASB 2022-6: Amendments to Australian Accounting Standards – Non-current Liabilities with Covenants AASB 2022-6 amends AASB 101 to improve the information an entity provides in its financial statements about liabilities arising from loan arrangements for which the entity’s right to defer settlement of those St George Mining Limited – Annual Report 2023 P 42 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 liabilities for at least 12 months after the reporting period is subject to the entity complying with conditions specified in the loan arrangement. It also amends an example in Practice Statement 2 regarding assessing whether information about covenants is material for disclosure. The Group plans on adopting the amendment for the reporting period ending 30 June 2024. The amendment is not expected to have a material impact on the financial statements once adopted. • AASB 2021-2: Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of Accounting Estimates The amendment amends AASB 7, AASB 101, AASB 108, AASB 134 and AASB Practice Statement 2. These amendments arise from the issuance by the IASB of the following International Financial Reporting Standards: Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) and Definition of Accounting Estimates (Amendments to IAS 8). The Group plans on adopting the amendment for the reporting period ending 30 June 2024. The impact of the initial application is not yet known. • AASB 2021-5: Amendments to Australian Accounting Standards – Deferred Tax related to Assets and Liabilities arising from a Single Transaction The amendment amends the initial recognition exemption in AASB 112: Income Taxes such that it is not applicable to leases and decommissioning obligations – transactions for which companies recognise both an asset and liability and that give rise to equal taxable and deductible temporary differences. The Group plans on adopting the amendment for the reporting period ending 30 June 2024. The impact of the initial application is not yet known. • AASB 2021-7b & c: Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128 and Editorial Corrections AASB 2021-7b makes various editorial corrections to AASB 17 Insurance Contracts which applies to annual reporting periods beginning on or after 1 January 2023, with earlier application permitted. AASB 2021-7c defers the mandatory effective date (application date) of amendments to AASB 10 and AASB 128 that were originally made in AASB 2014-10: Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture so that the amendments are required to be applied for annual reporting periods beginning on or after 1 January 2025 instead of 1 January 2018. The Group plans on adopting the amendments for the reporting periods ending 30 June 2024 and 30 June 2026. The impact of initial application is not yet known. • AASB 2022-7: Editorial Corrections to Australian Accounting Standards and Repeal of Superseded and Redundant Standards AASB 2022-7 makes editorial corrections to the following standards: AASB 7, AASB 116, AASB 124, AASB 128, AASB 134 and AASB as well as to AASB Practice Statement 2. It also formally repeals superseded and redundant Australian Account Standards as set out in Schedules 1 and 2 to the Standard. The Group plans on adopting the amendments for the reporting period ending 30 June 2024. The amendment is not expected to have a material impact on the financial statements once adopted. St George Mining Limited – Annual Report 2023 P 43 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (u) Comparative information Comparative information is amended where appropriate to ensure consistency in presentation with the current year. 3 REVENUE Interest income Other income 4 ADMINISTRATION EXPENSES Administration expenses include the following expenses: Employee benefit expense Wages and salaries Accrued leave Performance options Defined contribution superannuation expense Other administration costs Accounting and administration fees Legal fees Publications and subscriptions Presentations and seminars Rental expenses Share registry costs Travel expenses ROU depreciation Depreciation Other Total administration expenses CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 82,226 65,553 147,779 4,360 74,053 78,413 CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 621,914 21,478 175,795 69,695 888,882 2,592 57,359 119,062 220,081 57,190 50,371 305,289 95,679 16,371 632,475 1,556,469 2,445,351 600,215 52,103 (161,998) 44,351 534,671 1,436 24,919 32,811 102,724 57,897 41,957 43,174 76,231 15,785 470,694 867,628 1,402,299 5 EXPLORATION EXPENDITURE WRITTEN OFF Exploration expenditure written off Tenement acquisition costs CONSOLIDATED 30 JUNE 2023 $ 7,011,519 1,399,229 8,410,748 CONSOLIDATED 30 JUNE 2022 $ 6,828,382 13,248 6,841,630 St George Mining Limited – Annual Report 2023 P 44 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 6 FINANCE EXPENSES Interest expense Lease interest CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ - 19,445 19,445 - 14,801 14,801 Refer to Note 11 for details in relation to the right of use asset and lease liability. 7 INCOME TAX (a) Prima facie income tax benefit at 25% on loss from ordinary activities is reconciled to the income tax provided in the financial statements Loss before income tax Income tax calculated at 25% (2022: 25%) Tax effect of;- Sundry – temporary differences Section 40-880 deduction Future income tax benefit not brought to account Income tax benefit (b) Deferred tax assets CONSOLIDATED 30 JUNE 2023 $ (10,727,765) (2,681,942) CONSOLIDATED 30 JUNE 2022 $ (8,180,317) (2,045,079) 2,254 (153,962) 2,833,650 - 20,888 (122,888) 2,147,079 - The potential deferred tax asset arising from the tax losses and temporary differences have not been recognised as an asset because recovery of tax losses is not yet probable. Australian accumulated tax losses (i), (ii), (iii) Provisions - net of prepayments Section 40-880 deduction Unrecognised deferred tax assets relating to the above temporary differences The benefits will only be obtained if: CONSOLIDATED 30 JUNE 2023 $ 13,108,175 6,275 378,926 CONSOLIDATED 30 JUNE 2022 $ 10,274,525 57,707 235,781 13,493,376 10,568,013 (i) (ii) (iii) The Group derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deduction for the losses to be realised; The Group continues to comply with the conditions in deductibility imposed by the Law; and No change in tax legislation adversely affects the Group in realising the benefits from the deductions or the losses. St George Mining Limited – Annual Report 2023 P 45 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 8 AUDITOR’S REMUNERATION Auditing and review of the Group’s financial statements 9 KEY MANAGEMENT PERSONNEL (a) Details of key management personnel Directors John Prineas John Dawson Sarah Shipway Executive John Prineas – Executive Chairman (b) Compensation of key management personnel Salaries and fees Post employment benefits – superannuation Equity settled share based payments Long service and annual leave benefits 10 CURRENT ASSETS (a) Trade and Other Receivables Current CONSOLIDATED 30 JUNE 2023 $ 58,713 58,713 CONSOLIDATED 30 JUNE 2022 $ 51,201 51,201 CONSOLIDATED 30 JUNE 2023 $ 569,877 43,308 84,221 10,652 708,058 CONSOLIDATED 30 JUNE 2022 $ 569,165 41,245 (78,572) 44,140 575,978 CONSOLIDATED 30 JUNE 2023 $ 32,306 32,306 CONSOLIDATED 30 JUNE 2022 $ 73,236 73,236 Other receivables include amounts outstanding for goods and services tax (GST) of $9,860 (2022: $57,533), interest receivable of $8,916 (2022: $779), reimbursements $13,530 (2022: $11,924) and security bond of nil (2022: $3,000). GST amounts are non-interest bearing and have repayment terms applicable under the relevant government authorities. No trade and other receivables are impaired or past due. (b) Other Assets Prepayments CONSOLIDATED 30 JUNE 2023 $ 123,060 123,060 CONSOLIDATED 30 JUNE 2022 $ 124,434 124,434 St George Mining Limited – Annual Report 2023 P 46 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 11 (a) RIGHT OF USE ASSET AND LEASE LIABILITY Right of use asset Cost Accumulated depreciation Carrying value at end of period Opening net carrying value Additions Depreciation for the period Carrying value at end of period CONSOLIDATED 30 JUNE 2023 $ 502,998 (192,591) 310,407 333,064 73,022 (95,679) 310,407 CONSOLIDATED 30 JUNE 2022 $ 527,491 (194,427) 333,064 50,029 359,266 (76,231) 333,064 During the year the lease expired and was renewed, resulting in the reduction in the cost and depreciation. (b) Lease Liability Current Property lease liability Non-Current Property lease liability Total lease liabilities CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 90,704 237,168 327,872 82,070 261,544 343,614 Property leases The above right-of-use asset (ROU) and lease liability relate to the office lease and storage lease entered into by the Group. The lease has been accounted in accordance with AASB 16. The right-of-use asset is measured at the amount equal to the lease liability at initial recognition and then amortised over the life of the lease. The lease liability and ROU asset at initial recognition is $502,998. The right-of-use asset is being depreciated over the lease term on a straight-line basis which is approximately 60 and 24 months for the office and storage lease, respectively, in place at 30 June 2023. Depreciation expense of $95,679 (2022: $76,231) was included in corporate administration expense in the consolidated statement of profit or loss and other comprehensive income. At initial recognition, the lease liability was measured as the present value of minimum lease payments using the Group’s incremental borrowing rate of 5.4%. The incremental borrowing rate was based on the unsecured interest rate that would apply if finance was sought for an amount and time period equivalent to the lease requirements of the Group. Each lease payment is allocated between the liability and interest expense. The interest expense of $19,445 (2022: $14,801) was included in finance expense in the consolidated statement of profit or loss and other comprehensive income. Lease payments during the year was $108,209 including interest. Option to extend or terminate The Group uses hindsight in determining the lease term where the contract contains options to extend or terminate the lease. St George Mining Limited – Annual Report 2023 P 47 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 12 PLANT AND EQUIPMENT Plant and Equipment At Cost Accumulated depreciation Total plant and equipment Plant and Equipment Carrying amount at the beginning of the year Additions Disposals Depreciation expense Total carrying amount at end of year 13 CURRENT LIABILITIES Trade and other payables CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 111,297 (80,435) 30,862 40,081 7,152 - (16,371) 30,862 104,144 (64,063) 40,081 28,325 27,541 - (15,785) 40,081 CONSOLIDATED 30 JUNE 2023 $ 1,498,083 1,498,083 CONSOLIDATED 30 JUNE 2022 $ 1,294,595 1,294,595 Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying amounts of trade and other payables are considered to be the same as their fair values due to their short-term nature. As at 30 June 2023 $894,851 (2022: $38,538) was past 30 days due. 14 ISSUED CAPITAL Australian Dollar $ Issued and paid up capital (a) At the beginning of the reporting period Shares issued during the prior period December 2022: 105,941,190 shares issued at $0.068 January 2023: 23,255,814 shares issued at $0.086 March 2022: 94,230,769 shares issued at $0.052 April 2022: 12,749,948 shares issued at $0.052 June 2022: 3,846,154 shares issued at $0.052 Exercise of Options Share based payments (i), (ii) Transactions costs arising from issue of shares At reporting date 840,510,549 (30 June 2022: 700,017,808) fully paid ordinary shares CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 62,739,363 57,336,331 7,204,001 2,000,000 - - - - 838,748 (1,188,427) - - 4,800,000 663,000 200,000 - 100,000 (359,968) 71,593,685 62,739,363 St George Mining Limited – Annual Report 2023 P 48 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 Movements in Ordinary Shares At the beginning of the reporting period Shares issued during the period December 2022: 105,941,190 shares issued at $0.068 January 2023: 23,255,814 shares issued at $0.086 March 2022: 92,307,692 shares issued at $0.052 April 2022: 12,749,948 shares issued at $0.052 June 2022: 3,846,154 shares issued at $0.052 Options exercised during the year Share based payments (i), (ii) At reporting date Number 700,017,808 105,941,190 23,255,814 - - - - 11,295,737 840,510,549 Number 589,190,937 - - 92,307,692 12,749,948 3,846,154 - 1,923,077 700,017,808 (i) During the year ended 30 June 2023 the following share-based payments were made: (a) 1,250,000 fully paid ordinary shares were issued at $0.071 per share as consideration to acquire exploration licences. (b) 4,225,319 fully paid ordinary shares were issued at $0.071 per share as consideration to acquire exploration licences. (c) 2,695,418 fully paid ordinary shares were issued at $0.074 per share as consideration to acquire exploration licences. (d) 3,125,000 fully paid ordinary shares were issued at $0.080 per share as consideration to acquire exploration licences. (ii) During the year ended 30 June 2022 the following share-based payments were made: (a) 1,923,077 fully paid ordinary shares were issued at $0.052 per share as consideration for services provided to the Company. Movements in Performance Rights At the beginning of the reporting period Changes to Performance Rights issued during the year Performance Rights cancelled during the year Issued during the year (i) At reporting date Number Number - - - - 265 (265) - - (i) The Company issued no performance rights (2022: Nil) during the year. Please refer to note 18. Movements in Performance Options At the beginning of the reporting period Changes to Performance Options issued during the year Performance Options cancelled during the year Issued during the year (i) At reporting date Number Number - - 22,500,000 22,500,000 - - - - (i) The Company issued 22,500,000 performance options (2022: Nil) during the year. Please refer to note 18. St George Mining Limited – Annual Report 2023 P 49 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (b) Reserve Movements in reserve At the beginning of the year Expiry of options transferred to accumulated losses Expiry of performance rights Performance options expense (i) Share based payments expense At reporting date (i) Performance options expense (see note 18). CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ 496,426 - - 824,596 - 1,321,022 658,425 - (511,500) - 349,501 496,426 A summary of the outstanding options at 30 June 2023 in the Company is listed below: Unlisted Options Class Listed Options Unlisted Options Class A Performance Options* Class B Performance Options* Class C Performance Options* Class D Performance Options* Class A Performance Options* Class B Performance Options* Class C Performance Options* Class D Performance Options* Number of Options 39,188,238 5,000,000 2,250,000 2,250,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 *Options vest on certain milestones being achieved. 15 ACCUMULATED LOSSES Exercise Price $ $0.10 $0.095 - - - - - - - - Expiry Date 31.12.2025 24.03.2024 31.12.2024 31.12.2025 31.12.2025 30.06.2026 31.12.2024 31.12.2025 31.12.2025 30.06.2026 Accumulated losses at the beginning of the year Loss for the year Expiry of options transferred from accumulated losses Accumulated losses at the end of the year 16 LOSS PER SHARE Basic loss per share after income tax attributable to members of the Company (cents per share) Diluted loss per share (cents per share) CONSOLIDATED 30 JUNE 2023 $ (60,366,967) (10,727,765) - (71,094,732) CONSOLIDATED 30 JUNE 2022 $ (52,186,650) (8,180,317) - (60,366,967) CONSOLIDATED 30 JUNE 2023 $ CONSOLIDATED 30 JUNE 2022 $ (1.38) (1.38) (1.33) (1.33) St George Mining Limited – Annual Report 2023 P 50 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 Weighted average number of shares on issue during the financial year used in the calculation of basic earnings per share Weighted average number of ordinary shares for diluted earnings per share 2023 Number 2022 Number 776,198,056 617,303,308 776,198,056 617,303,308 17 NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS (a) Reconciliation of cash and cash equivalents For the purposes of the consolidated statement of cash flows, cash and cash equivalents consist of cash at bank and in hand and short-term deposits with an original maturity of three months or less, net of outstanding bank overdrafts. Current – cash at bank CONSOLIDATED 30 JUNE 2023 $ 3,337,581 3,337,581 CONSOLIDATED 30 JUNE 2022 $ 4,103,089 4,103,089 (b) Reconciliation of loss after tax to net cash flows from operations Loss after income tax Share based payments Depreciation expense Lease interest Non-cash exploration costs and tenement acquisitions (Increase)/decrease in assets Trade and other receivables Other assets Increase/(decrease) in liabilities Trade and other payables Provisions Non-cash investing and financing activities: CONSOLIDATED 30 JUNE 2023 $ (10,727,765) 175,795 112,050 19,445 1,399,229 40,930 1,374 203,422 21,479 (8,754,041) CONSOLIDATED 30 JUNE 2022 $ (8,180,317) (161,998) 92,017 14,801 100,000 (19,919) (53,971) 703,301 52,102 (7,453,984) (i) For details in relation to the non-cash payments for tenement acquisitions refer to note 14 (a)(i). St George Mining Limited – Annual Report 2023 P 51 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 18 SHARE BASED PAYMENTS During the year the Company issued 22,500,000 performances options and as at the balance date there were 22,500,000 performance options were on issue. (a) On 16 March 2023 at the general meeting of shareholders, the Company agreed and Shareholders approved the issue of 12,000,000 performance options to Directors of the Company. An additional 10,500,000 performance rights were issued to employees of the Company. The Performance Rights issued had the following milestones attached to them: (i) (ii) (iii) (iv) Class A Performance Option: Vesting on the Company reaching a market capitalisation of at least AUD$100m, based on a volume weighted average price of the Company’s shares over the 20 consecutive trading days on which the Company’s shares have traded prior to the Company reaching a market capitalisation of at least AUD$100m, on or before 31 December 2024. Class B Performance Option: Vesting on the Company reaching a market capitalisation of AUD150m, based on a volume weighted average price of the Company’s shares over 20 consecutive trading days on which the Company’s shares have traded prior to the Company reaching a market capitalisation of at least AUD$150m, on or before 31 December 2025. Class C Performance Option: Vesting on the Company announcing a JORC compliant Inferred Mineral Resource (as defined in the JORC Code 2012 Edition) at any of the Company’s Project of not less than: (a) 1,000,000 ounces of Au (at a cut-off grade of 0.3%); (b) 50,000t contained Ni (at a cut-off grade of 0.3%); (c) 10,000t contained Co (at a cut-off grade of 0.1%); (d) 50,000t contained Cu (at a cut-off grade of 0.2%); or (e) 1,000,000t contained Li (at a cut-off grade of 0.5%). On or before 31 December 2025. Class D Performance Option: Vesting upon delineating a JORC compliant Inferred Mineral Resource (as defined in the JORC Code 2012 Edition) of 50Mt or more at a minimum grade of 0.08% Li2O at the Company’s Projects. For the avoidance of doubt the resource referred to above refers to the combined lithium resources of the Company at all of its Projects (including the Company’s proportionate share of any project owned under a joint venture or other co-investment arrangement) and is not limited to any specific project area. On or before 31 December 2027. Each performance option converts to one (1) fully paid ordinary share on achievement of the milestone. St George Mining Limited – Annual Report 2023 P 52 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 The performance options were ascribed the below value: Class Date of Issue Class A Total Class A Class B Total Class B Class C Total Class C Class D Total Class D Total 29.09.22 24.03.23 - 29.09.22 24.03.23 - 15.08.18 17.12.18 - 15.08.18 17.12.18 - - Number of Performance Options (i) 2,250,000 3,000,000 5,250,000 2,250,000 3,000,000 5,250,000 3,000,000 3,000,000 6,000,000 3,000,000 3,000,000 6,000,000 22,500,000 Expiry Date Price of Shares ($) Total Value ($) (ii) Expense for the period ($) 31.12.24 21.12.24 31.12.25 31.12.25 31.12.25 31.12.25 31.12.27 31.12.27 - - 0.035 0.058 - 0.035 0.058 - 0.035 0.058 - 0.035 0.058 - - 78,750 174,000 252,750 78,750 174,000 252,750 105,000 174,000 279,000 105,000 174,000 279,000 1,063,500 26,568 29,177 55,745 18,744 19,598 38,342 24,727 19,087 43,814 21,536 16,358 37,894 175,795 (i) (ii) Each Performance option will convert into one fully paid ordinary share. The value of the rights was determined as per the date the rights were issued. It has been deemed that the milestones occurring for the performance options on issue as at reporting date will more likely occur and therefore expenses were accounted in full over the vesting period. Of the above performance options granted, the following were issued to key management personnel, and had not expired as at 30 June 2023. Key Management Personnel J Prineas Class A Class B Class C Class D J Dawson Class A Class B Class C Class D S Shipway Class A Class B Class C Class D Grant Date Number of Performance Rights 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 24.03.23 2,000,000 2,000,000 2,000,000 2,000,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 St George Mining Limited – Annual Report 2023 P 53 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (b) On 13 December 2023 the Company issued 16,000,000 Listed Options exercisable at $0.10 on or before 13 December 2025 for services rendered to the Company. The options vested upon issue. The options were ascribed the below value using the Black-Scholes model. Valuation Date 13.12.2022 Risk Free Rate 3.19% Volatility 91.57% Expiry Date 12.12.2025 Exercise Price 0.10 Value $ $0.038 (c) On 24 March 2023 the Company issued 2,000,000 Listed Options exercisable at $0.10 on or before 13 December 2025 for services rendered to the Company. The options vested upon issue. The options were valued at market value at a value of $0.018 per listed option. A summary of the movements in the Company options, other than the performance options noted above, issued is as follows: Options outstanding as at 30 June 2021 Granted Forfeited Exercised Expired Options outstanding as at 30 June 2022 Issued Forfeited Exercised Expired Options outstanding as at 30 June 2023 Options exercisable as at 30 June 2023 Options exercisable as at 30 June 2022 Number Weighted Average Exercise Price $ 2,500,000 5,000,000 - - - 7,500,000 39,188,238 - - (2,500,000) 44,188,238 44,188,238 7,500,000 0.15 0.095 - - - - 0.10 - - - 0.10 - - The weighted average remaining contractual life of options outstanding at the year-end was 2.3 years (2022: 1.18 years). The weighted average exercise price of outstanding options at the end of the report period was $0.10 (2022: $0.11). 19 (a) COMMITMENTS AND CONTINGENCIES Commitment Mineral exploration commitments The Group has the following minimum exploration expenditure requirements in connection with its exploration tenements. Not later than one year Later than one year but not later than two years 30 June 2023 $ 461,622 457,344 918,966 30 June 2022 $ 265,082 207,606 472,688 St George Mining Limited – Annual Report 2023 P 54 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (b) Contingent liabilities and commitments The Group fully owns five subsidiaries, Desert Fox Resources Pty Ltd, Blue Thunder Resources Pty Ltd, Destiny Lithium Pty Ltd, Dragon Lithium Pty Ltd and Lithium Star Pty Ltd the main activities of which are exploration. The effect of these subsidiaries is to make the St George Mining owned subsidiaries contractually responsible for any transactions undertaken by the subsidiary. The parent entity has provided certain guarantees to third parties whereby certain liabilities of the subsidiary are guaranteed. There are no contingent liabilities as at the date of this report. 20 EVENTS SUBSEQUENT TO BALANCE SHEET On 8 August 2023 the Company advised that it had completed the acquisition of seven lithium prospective projects located in Western Australia that was announced previously on 22 March 2023. The Company paid $300,000 (plus GST) in cash upon completion and $400,000 (plus GST) worth of St George shares, being 6,064,435 shares, on completion. As part of the consideration the below is payable: 1. Resource Milestone Payment: 15,000,000 fully paid ordinary shares in St George (Milestone Shares) if St George announces a JORC 2012 compliant Inferred Mineral Resource at a Lithium Project of not less than 10,000,000 tonnes of Li20 with a minimum grade of 1% Li20 (using a cut-off grade of no less than 0.5%) (Milestone) prior to the date which is five years from completion of the acquisition (Milestone End Date). • With respect to each Lithium Project, the issue of any Milestone Shares is subject to shareholder approval. If that shareholder approval is not obtained then St George will pay Chariot Corporation the amount in cash which is equal to the value 15,000,000 fully paid ordinary shares in St George multiplied the VWAP of the shares for the 15 trading days before the date that the relevant Milestone was satisfied. A Resource Milestone Payment is payable in regard to each Lithium Project upon the first time the Milestone is satisfied for that Project. If the Milestone for a Lithium Project is not met prior to the Milestone End Date, St George may elect to either make the Milestone Payment to the Seller or otherwise St George must transfer the applicable tenements for that Lithium Project back to the Seller for consideration of $1. • 2. A 2% net smelter royalty will be retained by Chariot in respect of any mineral products produced and sold from any of the Lithium Projects. St George will have the right to buy back half of the royalty in respect of a Lithium Project by paying $5,000,000 cash to Chariot at any time prior to first commercial production from that Lithium Project. On 31 July 2023 the Company announced the issue of 2,000,000 performance rights to an employee of the Company. On 15 September 2023 the Company incorporated Lithium Blue Pty Ltd, a fully owned subsidiary company of St George Mining Limited. Other than the above there have been no matters or circumstances that have arisen since the end of the financial year which significantly affected or could significantly affect the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial years. St George Mining Limited – Annual Report 2023 P 55 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 21 (a) FINANCIAL INSTRUMENTS Interest Rate Risk The Group’s exposure to interest rate risk, which is the risk that the financial instrument’s value will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates on those financial assets and financial liabilities, is as follows: 2023 Note Financial assets Cash and cash equivalents Trade and other receivables Security bond 17(a) 10(a) - Floating interest rate $ 3,327,790 - 71,748 3,399,538 Financial liabilities Trade and other payables Lease liability 2022 13 11(b) Note Financial assets Cash and cash equivalents Trade and other receivables Security bond 17(a) 10(a) - Floating interest rate $ 4,097,544 - 68,682 4,166,226 Fixed interest rate $ Non- interest bearing $ Total $ Weighted average interest rate % - - - - 9,791 32,306 - 42,097 3,337,581 32,306 71,748 3,441,635 - - - - 327,872 327,872 1,498,083 - 1,498,083 1,498,083 327,872 1,825,955 Fixed interest rate $ Non- interest bearing $ Total $ Weighted average interest rate % - - - - 5,545 73,236 3,000 81,781 4,103,089 73,236 71,682 4,248,007 Financial liabilities Trade and other payables Lease liability 13 11(b) - - - - 343,614 343,614 1,294,595 - 1,294,595 1,294,595 343,614 1,638,209 Based on the balances at 30 June 2023 a 1% movement in interest rates would increase/decrease the loss for the year before taxation by $33,376 (2022: $38,226). (b) Credit Risk The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount of those assets, net of any allowance for doubtful debts, as disclosed in the statement of financial position and notes to the financial report. The Group does not have any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the Group. St George Mining Limited – Annual Report 2023 P 56 2.36% - 0.02% - - 5.40% - 0.11% - 0.11% - - 5.40% - NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 (c) Financial liabilities Financial liabilities are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised costs using the effective interest method. Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are classified as non-current. The contractual maturities of the Group’s financial liabilities are as follows: Contractual maturities of financial liabilities As at 30 June 2023 Non-derivatives Lease liability Trade and other payables Total non-derivatives Less than 6 months 6 – 12 months Between 1 and 2 years Between 2 and 5 years Over 5 years Total contractual cash flows Carrying amount (assets)/liabilities 43,945 1,498,083 1,542,028 46,758 - 46,758 100,496 - 100,496 136,673 - 136,673 - - - 327,872 1,498,083 1,825,955 327,872 1,498,083 1,825,955 (d) Net Fair Values The carrying amount of financial assets and financial liabilities recorded in the financial statements represent their respective net fair value and is determined in accordance with the accounting policies disclosed in note 2 to the financial statements. (e) Financial Risk Management The Group’s financial instruments consist mainly of deposits with recognised banks, investment in term deposits up to 90 days, accounts receivable, accounts payable and borrowings. Liquidity is managed, when sufficient funds are available, by holding sufficient funds in a current account to service current obligations and surplus funds invested in term deposits. The directors analyse interest rate exposure and evaluate treasury management strategies in the context of the most recent economic conditions and forecasts. The main risks the Group is exposed to through its financial instruments are the depository banking institution itself, holding the funds, and interest rates. The Group's credit risk is minimal as being an exploration Company, it has no significant financial assets other than cash and term deposits. (f) Foreign Currency Risk The Group is not exposed to any significant foreign currency risk as at 30 June 2023. (g) Market Price Risk The Group is not exposed to market price risk as it does not have any investments other than an interest in the subsidiaries. St George Mining Limited – Annual Report 2023 P 57 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 22 RELATED PARTIES The Group has 100% owned subsidiaries Blue Thunder Resources Pty Ltd, Desert Fox Resources Pty Ltd, Destiny Lithium Pty Ltd, Dragon Lithium Pty Ltd and Lithium Star Pty Ltd. St George Mining is required to make all the financial and operating decisions of these subsidiaries. Subsidiaries of St George Mining Limited Desert Fox Resources Pty Ltd Blue Thunder Resources Pty Ltd Destiny Lithium Pty Ltd Dragon Lithium Pty Ltd Lithium Star Pty Ltd Country of Incorporation Percentage Owned % Australia Australia Australia Australia Australia 30 June 2023 100% 100% 100% 100% 100% 30 June 2022 100% 100% 100% 0% 0% At 30 June 2023 balances due from the subsidiaries were: Blue Thunder Resources Pty Ltd Desert Fox Resources Pty Ltd Destiny Nickel Pty Ltd Dragon Lithium Pty Ltd Lithium Star Pty Ltd 30 JUNE 2023 $ 31,100,168 23,365,254 719,237 156,694 55,925 55,397,278 30 JUNE 2022 $ 26,645,431 23,364,118 - - - 50,009,549 These amounts comprise of funds provided by the parent company for exploration activities. The amounts were fully provided for as at 30 June 2023 and have been eliminated on consolidation. During the year, the Company paid $63,546 (2022: $51,500) on behalf of American West Metals Limited (American West Metals), of which John Prineas is a director. American West Metals fully reimbursed the company $63,546 (2022: 51,500) for these expenses during the year. 23 SEGMENT REPORTING For management purposes, the Group is organised into one main operating segment, which involves the exploration of minerals in Australia. All of the Group’s activities are interrelated, and discrete financial information is reported to the Board as a single segment. Accordingly, all significant operating decisions are based upon analysis of the Group as one segment. The financial results from this segment are equivalent to the financial statements of the Group as a whole. The accounting policies applied for internal reporting purposes are consistent with those applied in the preparation of these financial statements. 24 JOINT VENTURES The Group recognises that joint ventures are a key mechanism for sharing of risk on individual exploration projects. Where appropriate for a particular project, the Group will consider a joint venture with a suitable party in order to share the exploration risk. Those funds otherwise set aside for the project will be employed to advance another project. There were no joint ventures in place during and at the end of the financial year. St George Mining Limited – Annual Report 2023 P 58 NOTES TO THE CONSOLIDATED FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2023 25 (a) PARENT COMPANY DISCLOSURE Financial Position Australian Dollar ($) Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity (b) Financial Performance Australian Dollar $ Profit (loss) for the year Other comprehensive income Total comprehensive income (loss) 30 JUNE 2023 $ 30 JUNE 2022 $ 3,509,626 341,273 3,850,899 1,834,644 237,168 2,071,812 1,779,087 4,685,936 40,080 4,726,016 1,615,213 261,544 1,876,757 2,849,259 71,593,684 1,321,022 (71,135,619) 1,779,087 62,739,362 496,427 (60,386,530) 2,849,259 30 JUNE 2023 $ (10,749,087) - (10,749,087) 30 JUNE 2022 $ (8,137,851) - (8,137,851) (c) Guarantees entered into by the Parent Entity Other than as disclosed in Note 19 (b) the parent entity has not provided guarantees to third parties as at 30 June 2023. St George Mining Limited – Annual Report 2023 P 59 DIRECTOR’S DECLARATION In the opinion of the Directors of St George Mining Limited (“the Company”) (a) The financial statements and the notes and the additional disclosures included in the directors’ report designated as audited of the Group are in accordance with the Corporations Act 2001, including: (i) Giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its performance for the year ended that date; and (ii) Complying with Accounting Standards and Corporations Regulations 2001, and: (b) (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. The financial statements and notes comply with International Financial Reporting Standards as disclosed in note 2. 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 financial year ended 30 June 2023. Signed in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations Act 2001. On behalf of the Board John Prineas Executive Chairman Dated: 28 September 2023 Perth, Western Australia St George Mining Limited – Annual Report 2023 P 60 PO Box 1908 West Perth WA 6872 Australia 40, Kings Park Road West Perth WA 6005 Australia Tel: +61 8 9481 3188 Fax: +61 8 9321 1204 ABN: 84 144 581 519 www.stantons.com.au 28 September 2023 Board of Directors St George Mining Limited Suite 2, 28 Ord Street West Perth WA 6005 Dear Directors RE: ST GEORGE MINING LIMITED In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of St George Mining Limited. As the Audit Director for the audit of the financial statements of St George Mining Limited for the year ended 30 June 2023, I declare that to the best of my knowledge and belief, there have been no contraventions of: (i) (ii) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and any applicable code of professional conduct in relation to the audit. Yours sincerely STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD Martin Michalik Director Liability limited by a scheme approved under Professional Standards Legislation. Stantons Is a member of the Russell Bedford International network of firms P 61 PO Box 1908 West Perth WA 6872 Australia Level 2, 40 Kings Park Road West Perth WA 6005 Australia Tel: +61 8 9481 3188 Fax: +61 8 9321 1204 ABN: 84 144 581 519 www.stantons.com.au INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ST GEORGE MINING LIMITED Report on the Audit of the Financial Report Opinion We have audited the financial report of St George Mining Limited (“the Company”), and its subsidiaries (“the Group”), which comprises the consolidated statement of financial position as at 30 June 2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and 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: (i) giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its financial performance for the year then ended; and (ii) 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 Company 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 confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters We have defined the matters described below to be the key audit matter to be communicated in our report. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on this matter. Liability limited by a scheme approved under Professional Standards Legislation Stantons Is a member of the Russell Bedford International network of firms P 62 How the matter was addressed in the audit Inter alia, our audit procedures following: included the i. ii. iii. iv. v. vi. Obtaining an understanding of the underlying transactions; Verifying all issued capital movements to the relevant ASX announcements; Vouching proceeds from capital raisings to bank statements and other relevant supporting documentation; Verifying underlying capital raising costs and ensuring these costs were appropriately recorded; Ensuring consideration for acquisition of mineral interests or for services provided are measured in accordance with AASB 2 Share- Based Payments and agreed the related costs to relevant supporting documentation; and Ensuring the requirements of the relevant accounting standards and disclosures achieve fair presentation and reviewing the financial statements to ensure appropriate disclosures are made. Inter alia, our audit procedures included the following: i. ii. iii. iv. the inputs and examining the Verifying assumptions used in the Group’s valuation of share options and performance rights, being the share price of the underlying equity, time to maturity (expected life), share price volatility and grant date; Challenging management’s assumptions in relation to the likelihood of achieving the performance conditions; Assessing the fair value of the calculation through re-performance using appropriate inputs; and Assessing the accuracy of the share-based payments expense and the adequacy of disclosures made by the Group in the financial report. Key Audit Matters Issued Capital (refer to Note 14(a)) Issued Capital amounted to The Group’s $71,593,685. During the reporting year, 140,492,741 ordinary shares were issued through placements and for consideration for mineral interests or services, resulting Issued Capital of $8,854,322 net of capital raising costs (refer to Note 14(a) to the financial report). increase in an in Contributed Equity is a key audit matter due to: • • the quantum of share capital issued during the year; and the varied nature of the movements during the year. We have spent significant audit effort on ensuring the Issued Capital was appropriately accounted for and disclosed. Share based payments - Performance rights and share options (refer to Notes 18 and 14) During the year, the Company issued 39,188,238 share options to brokers and consultants. In addition, 22,500,000 performance rights were granted to directors. The Group valued the share options using the Black- Scholes methodology and the performance rights based on the share price at grant date and estimated likelihood of performance conditions being achieved over the vesting period for each tranche of awards. The Group has performed calculations to record the related share-based payment expense of $824,596, of which $175,795 has been recognised in the profit or to 18,000,000 options, is recognised directly in equity as it related to capital raising activities. loss and $648,801, relating In addition, a further $838,748 of expenses was settled by issuing 11,295,737 shares. Share based payments are considered to be a key audit matter due to: - - the value of the transactions; the complexities involved in the recognition and measurement of these instruments under AASB 2 Share-based Payment; and judgement involved in determining the inputs used in the valuations. - P 63Going Concern (refer to Note 2(b)) The financial statements have been prepared on a going concern basis. Inter alia, our audit procedures included the following: At 30 June 2023, the Company had cash and cash equivalents of $3,337,581 and incurred a loss after income tax of $10,727,765. The Company had net operating outflows totaling $8,754,041. As directors’ assessment of the group’s ability to continue as a going concern is subject to significant judgement, we identified going concern as a significant risk requiring special audit consideration. i. ii. Evaluating and challenging management’s assessment of future cash flows up to and beyond 12 months from the date of this report including the management’s strategy and ability to manage its working capital; Reviewing plans by management to defer certain payments and/or secure additional funding through either the issue of further shares and/or debt funding or a combination thereof; and iii. Reviewing the disclosure in the financial to ensure appropriateness of statements disclosure. Other Information The directors are responsible for the other information. The other information comprises the information included in the Group’s annual report for the year ended 30 June 2023 but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance opinion thereon. 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 ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has 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 Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of the financial report that gives a true and fair view 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 entity's internal control. P 64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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial report. We 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. We 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. We 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. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements. 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, related safeguards. From the matters communicated with the Directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore 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 Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 24 to 27 of the directors’ report for the year ended 30 June 2023. In our opinion, the Remuneration Report of St George Mining Limited for the year ended 30 June 2023 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (An Authorised Audit Company) Martin Michalik Director West Perth, Western Australia 28 September 2023 P 65 SHAREHOLDER INFORMATION 1 Distribution of holders As at 28 September 2023 the distribution of shareholders was as follows: Ordinary shares Size of holding 1 – 1,000 1,001 –5,000 5,001 – 10,000 10,001 – 100,000 100,001 and over Total 2 Voting rights Number of holders 269 341 562 1,985 1,004 4,161 There are no restrictions to voting rights attached to the ordinary shares. On a show of hands every member present in person will have one vote and upon a poll, every member present or by proxy will have one vote each share held. 3 Substantial shareholders The company has no substantial shareholders who have notified the Company in accordance with Section 671B of the Corporation Act 2001. 4 Top 20 shareholders The names of the 20 largest shareholders on the share register as at 28 September 2023, who hold 35.22% of the ordinary shares of the Company, were as follows; Shareholder BNP Paribas Nominees Pty Ltd Citicorp Nominees Pty Limited Hongkong Xinwei Electronic Co Limited Mr Jiumin Yan HSBC Custody Nominees (Australia) Limited Mr Lee Ramon Cunnington + Mrs Nancy Lynne Cunnington Mr Xiaodong Ma Mr John Prineas Impulzive Pty Ltd Xueqing Yang Ms Yi Chen Heping Pty Ltd BNP Paribas Noms Pty Ltd Zeus Super Pty Ltd Mrs Xiaojin Li Allcap Pty Ltd Ms Betty Frilingos Chariot Corporation Ltd DDH 1 Drilling Pty Ltd Luxe Life Sydney Pty Ltd Number 68,425,520 54,803,285 23,255,814 21,632,496 16,066,618 13,860,341 10,505,718 9,504,501 8,504,641 8,403,496 7,800,000 7,584,323 7,210,800 7,095,554 6,428,589 6,029,567 5,818,182 5,397,348 5,029,137 4,780,896 St George Mining Limited – Annual Report 2023 P 66 SHAREHOLDER INFORMATION 5 Top 20 optionholders The names of the 20 largest optionholders on the register as at 28 September 2023, who hold 86.53% of the listed options of the Company, were as follows; Shareholder Cong Ming Limited Citicorp Nominees Pty Limited Zenix Nominees Pty Ltd Cong Ming Limited Intrepid Concepts Pty Ltd Ms Pei Zhen Zhang Mr Jiumin Yan Alliance Professional Pty Ltd BNP Paribas Nominees Pty Ltd Ian & Jon Investment Pty Ltd King Development Corporation Pty Ltd Riya Investments Pty Ltd Longridge Partners Pty Ltd Ms Yi Chen Mr John Arthur Jarvis Mila Investment Co Pty Ltd Munrose Investments Pty Ltd Ajava Holdings Pty Ltd Mishtalem Pty Ltd Mr Matthew Peter Selby 6 Consistency with business objectives Number 7,650,000 6,000,002 6,000,000 3,000,000 2,000,000 1,885,294 1,400,001 800,001 600,000 500,001 500,000 452,611 420,000 400,001 400,000 400,000 397,701 389,707 371,975 340,588 The Company has used its cash and assets in a form readily convertible to cash that it had at the time of listing in a way the consistent with its stated objectives. St George Mining Limited – Annual Report 2023 P 67 TENEMENT INFORMATION St George Mining Limited mineral interests as at 28 September 2023 MT ALEXANDER: Tenement ID E29/638 E29/548 E29/954 E29/962 E29/972 E29/1041 E29/1093 E29/1126 E29/1143 P29/2680 Registered Holder Location Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander Blue Thunder Resources Pty Ltd Mt Alexander PATERSON: Tenement ID E45/5226 BROADVIEW: A JANA: Tenement ID E70/5525 E70/5526 Tenement ID E70/5521 E70/5522 E70/6142 REGIONAL TENEMENTS: Tenement ID Registered Holder Location St George Mining Limited Paterson Registered Holder Location St George Mining Limited St George Mining Limited Broadview Broadview Registered Holder Location St George Mining Limited St George Mining Limited St George Mining Limited Ajana Ajana Ajana Registered Holder Location E70/5626 E37/1382 St George Mining Limited St George Mining Limited Boddington East Stuart Meadows Ownership (%) 75 100 100 100 100 100 100 100 100 100 Ownership (%) 100 Ownership (%) 100 100 Ownership (%) 100 100 100 Ownership (%) 100 100 St George Mining Limited – Annual Report 2023 P 68 St George Mining Limited ACN 139 308 973 www.stgeorgemining.com.au ATE DIRECTORY/CONTENTS PAGE 

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