More annual reports from Westgold Resources Limited:
2023 ReportPeers and competitors of Westgold Resources Limited:
Pan African Resources PLCANNUAL REPORT 2023
WESTGOLD RESOURCES LIMITED
A PROGRESSIVE AND
INNOVATIVE WESTERN
AUSTRALIAN GOLD
MINER
With over 1,300 staff and contractors and
more than 1,300km2 of tenure, Westgold is
the dominant gold miner in the Murchison
and Bryah regions of Western Australia.
www.westgold.com.au
CONTENTS
Our Purpose and Ambition
Values and Behaviours
Letter from the Chair
Financial Results
Our Annual Outputs
Our Operations
1
1
2
5
6
8
22 Directors’ Report
32 Remuneration Report (Audited)
49 Auditor’s Independence Declaration
50 Consolidated Statement of Comprehensive Income
51 Consolidated Statement of Financial Position
52 Consolidated Statement of Cash Flows
53 Consolidated Statement of Changes in Equity
54 Notes to the Consolidated Financial Statements
102 Directors’ Declaration
103
109 Shareholder Information
111 Corporate Directory
Independent Auditor’s Report
Westgold Resources Limited Annual Report 2023
OUR PURPOSE
AND AMBITION
VALUES AND
BEHAVIOURS
Westgold’s purpose as an organisation
is to create intergenerational wealth by
leveraging our gold assets. In doing so
we aspire to:
– create shareholder value,
– contribute to our wider communities,
and
– provide opportunities for our team
to grow and succeed.
Our values and behaviours guide how we
work with each other, our communities,
and external stakeholders. They speak to
the core aspirations of the organisation
and influence our actions and decisions.
Our values provide the framework that
holds us accountable and with the buy in
of our staff, ultimately drives the culture
that will deliver success.
CHOOSE SAFETY
– Think safety and act safely
– Look out for each other
– Protect our environment
SHOW RESPECT
– Appreciate everyone
for who they are and what
they contribute
– Enable everyone to do
a great job
– Grow strong teams and
communities
DELIVER VALUE
– Plan to succeed as a team
– Execute with excellence
– Rise to the challenge and
keep on improving
Westgold Resources Limited Annual Report 2023
1
LETTER FROM THE CHAIR
A TURNAROUND YEAR
Dear Shareholders,
It is my pleasure
to present
the Westgold
Resources Limited
Annual Report for
the financial year
ended 30 June
2023 (FY23).
FY23 has been one of significant
positive change for Westgold. After
working through early challenges and
refocusing in the first half of FY23, I’m
proud to see the company emerge
as a truly successful West Australian
gold producer.
In the first quarter of FY23 the Board
initiated a strategic review to address
the improvement of profitability of
the business.
In parallel, a new leadership team
initiated the reset of our culture,
operational base and approach to
cost management. A new strategy
was outlined to the shareholders with
commitment to an operating regime
that would deliver safe and profitable
production in FY23. The plan was to
restructure and stabilise the business
in the first half and if successful,
profitability would return in the
second half of FY23.
Difficult decisions were made,
including placing three marginal
underground mines on to care and
maintenance. Staff and equipment
were redeployed and consolidated
into four larger operating
underground mines. A deep dive into
Westgold’s cost base was completed
with opportunities identified to
improve productivity and reduce
our costs.
2
Westgold Resources Limited Annual Report 2023
With new vigour, Westgold’s safety
performance continued to improve,
along with operating efficiencies
and productivity. Cost management
improved dramatically alongside
greater accountability being shifted
back to operational management.
Significant investments were
made in exploration and resource
development with a view to extending
the planning horizon and mine life of
each of our four operating mines and
the planned next underground mine
at Great Fingall.
After two quarters of cash outflow,
the business was financially stabilised.
The second half of FY23 saw positive
cashflow from our operations and
increasing efficiencies being realised.
The large, fixed forward hedge book
was coming to an end and stronger
production from our mines, coupled
with a rising A$ gold price, lifted our
revenue.
Our approach to environmental,
social and corporate governance
(ESG) continues to evolve. ESG is key
to our social licence to operate and
with a view to reducing our emissions
and operating cost, major investment
was made in the construction of
four new hybrid (gas-solar-battery)
power stations across our operations.
The first station was commissioned
at Tuckabianna in July 2023, with
three more stations scheduled
for commissioning in the first half
of FY24.
Our commitment to becoming
a better corporate citizen was
evidenced in FY23 by greater
community initiatives and
involvement. A new Community
Relations team was established to
work with the communities we impact
upon across our regional tenure, and
particularly the area of indigenous
employment.
FY23 was a turnaround year for
Westgold. Our employees have
leaned into the new direction, new
culture and the values that underpin
how we do business. There is still
much to achieve but Westgold
finishes FY23 in a strong financial
position with $192M in cash, bullion
and liquid assets. Importantly, the
Group is fully funded to deliver its
FY24 corporate objectives.
Our vision for Westgold going forward
is clear. To be a safer, progressive,
socially responsible, highly profitable
and cash generative gold miner
with the aim of providing consistent
returns to our shareholders.
Thank you for your continued support.
Hon. Cheryl Edwardes AM
Non-Executive Chair
Westgold Resources Limited Annual Report 2023
3
4
Westgold Resources Limited Annual Report 2023
YEAR END 30 JUNE 2023
FINANCIAL
RESULTS
Unless specifically noted, all dollar amounts disclosed in this report are Australian Dollars (A$ or AUD)
GOLD SALES
REVENUE
256,009oz
$654.4M
(FY22: 269,705 oz)
(FY22: $647.6M)
NET CASH FROM
OPERATIONS
$168.4M
(FY22: $179.9M)
NET PROFIT/(LOSS)
BEFORE TAX
$13.9M
(FY22: ($160.1M))
NET PROFIT/(LOSS)
AFTER TAX
$10.0M
(FY22: ($111.1M))
CLOSING CASH, BULLION
& LIQUIDS*
$192M
(FY22: $190M)
PROFIT/(LOSS) PER SHARE
NET ASSETS
AVERAGE HEDGE GOLD PRICE
2.1c
(FY22: (25.3c))
$598.3M
A$2,495/oz
(FY22: $587.8M)
(FY22: A$2,396/oz)
OUTSTANDING HEDGED OUNCES
10,000oz
(FY22: 148,000oz)
* Bullion is valued at closing spot price.
Westgold Resources Limited Annual Report 2023
5
YEAR END 30 JUNE 2023
OUR ANNUAL
OUTPUTS
MURCHISON OPERATIONS
203,382oz
BRYAH OPERATIONS
53,735oz
GROUP
257,116oz
MURCHISON OPERATIONS
A$1,686/oz
BRYAH OPERATIONS
A$1,780/oz
GROUP
A$1,706/oz
MURCHISON OPERATIONS
A$1,971/oz
BRYAH OPERATIONS
A$2,103/oz
GROUP
A$1,999/oz
GOLD
PRODUCED
CASH COST
(C1)
ALL IN
SUSTAINING
COSTS
6
Westgold Resources Limited Annual Report 2023
Westgold Resources Limited Annual Report 2023
7
OUR OPERATIONS
REVIEW OF
OPERATIONS
Westgold Resources Limited (ASX: WGX) (Westgold or the Group) is a Western Australian gold mining business.
With over 1,300 staff and contractors, we are the dominant gold miner in the Mid West.
Westgold is the owner-operator of all its underground mines. This internal capability, provides a level of operational
flexibility and competitive advantage. This has ensured the business remains able to more consistently deliver against
operational targets. A ‘hub and spoke’ style operating model in the Murchison region provides optionality to process ore
from Westgold’s mines at either of its two processing hubs near Cue and Meekatharra. In contrast the Bryah operation
is centred upon the Fortnum processing hub.
In FY23, Westgold produced 257koz of gold at an All-In Sustaining Cost (AISC) of $1,999/oz, meeting the top end of its
FY23 Production Guidance of 240koz to 260koz and midpoint of its FY23 AISC Guidance of between $1,900/oz and
$2,100/oz.
MURCHISON OPERATIONS
The Murchison Operations incorporate the Tuckabianna and Bluebird processing hubs. With a combined production
of approximately 200koz per annum, the Murchison Operations currently delivers circa 80% of Westgold’s Group
gold production.
In FY23, the Murchison Operations produced 203koz of gold at an AISC of $1,971/oz (see Figure 1).
FY23 MURCHISON PRODUCTION AND A$ COST
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60,000
50,000
40,000
30,000
20,000
10,000
0
NOTE:
$ 2,235 /oz
$ 2,004 /oz
$ 2,016 /oz
$ 1,662 /oz
50,329 oz
49,280 oz
48,609 oz
55,165 oz
Q1FY23
Q2FY23*
Q3FY23
Q4FY23
Gold Produced
AISC/oz
2,500
2,000
1,500
1,000
500
0
* Q2 FY23 AISC adjusted post audited Half-Year Financial Report for the period ended 31 December 2022
Figure 1 - FY23 Murchison Production and A$ Costs
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WESTGOLD
ACHIEVES
MATERIAL
IMPROVEMENT
IN SAFETY
PERFORMANCE
Westgold has achieved a significant
year on year improvement in safety.
In FY23, there were no fatalities or
serious disabling injuries at Westgold.
Our Total Recordable Injury
Frequency Rate (TRIFR) showed
considerable improvement with a
63% reduction on the previous year,
finishing at 8.37 injuries per million
hours worked. Our Lost Time Injury
Frequency Rate (LTIFR) reduced from
1.41 to 0.64, which is a 55% reduction
for the period ending June 2023
(see Figure 3).
These results were achieved through
initiatives including:
– Visible and active leadership
at all levels of the business;
– A specific focus on managing
critical risks;
– Improved operational discipline
across all areas;
– Active investment in people,
health & wellbeing; and
– Tailored, relevant and well
tested frameworks, systems
and processes in place.
8
Westgold Resources Limited Annual Report 2023
CUE
Westgold’s Cue operation is located around the regional town of Cue and encompasses Westgold’s southern-most group
of assets including the historic mining centres of Big Bell, Cuddingwarra, Day Dawn and Tuckabianna (see Figure 2). This
package includes two of Western Australia’s most iconic past producers in the Big Bell mine (≈2.6Moz) and the Great Fingall
mine (≈1.2Moz).
It incorporates the 1.2-1.4Mtpa Tuckabianna processing hub, a 148-person village at Big Bell, a 266-person village at Cue
and associated mining infrastructure to support a large FIFO and DIDO mining operation.
In FY23, the Tuckabianna plant received underground ore from the large Big Bell underground and the smaller Comet
underground mine in addition to stockpiled ore from the previously mined Cuddingwarra open pits.
The Tuckabianna processing hub treated 1,328,159t of ore, at the upper range of the plant’s operating capacity on hard ore
and in line with expectations. The hub produced 90,769oz of gold in FY23, achieving a metallurgical recovery of 87%.
Big Bell remained the primary source of ore to the Tuckabianna mill, with the Comet underground mine providing
additional feed early in the year, prior to entering care and maintenance. In addition to fresh underground feed, Westgold
has access to significant ore stockpiles which it continued to utilise as supplementary ore feed at its Cue and Meekatharra
processing hubs.
Figure 2 - Cue assets
15
12
9
6
3
0
22.91
10
1.41
18.44
9
0.86
14.36
6
0.60
9.03
6
0.62
8.37
6
0.64
Q4FY22
Q1FY23
Q2FY23
Q3FY23
Q4FY23
TRI
LTIFR
TRIFR
-63%
25
20
15
10
5
0
E
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Figure 3 - Westgold has reduced TRIFR by 63% in FY23
9
Westgold Resources Limited Annual Report 2023
OUR OPERATIONS
REVIEW OF OPERATIONS
(CONTINUED)
Since commercial production
was declared in FY22, the Big
Bell mine (see Figure 4) has
consistently produced above
its designed capacity of 800-
900ktpa. In FY23, Big Bell
continued to expand, producing
1.13Mt of high grade ore at
2.6g/t.
Recent studies focused on
expanding Big Bell to the zone
beneath the pegmatites using
an open stoping with paste
fill mining method are well
advanced. This zone is expected
to extend the overall mine life of
Big Bell to over 10 years whilst
simultaneously increasing the
mined grade.
The Fender underground
mine, which was paused in
early FY23 will commence
late in the first quarter of FY24
providing additional feed to the
Meekatharra processing hub.
This mine will operate as an
extension to the Big Bell mine
given its close proximity.
In addition to the mining
operations, the Company
is accelerating exploration
activities across Cue with the
primary focus being the Day
Dawn mining centre, consisting
of Great Fingall and Golden
Crown. This work has been
based on new geophysical
datasets and geological re-
interpretations in early FY22,
leading to the discovery of the
Figure 4 - Big Bell showing proposed development of Big Bell Deeps
Sovereign target, located between Great Fingall and Golden Crown. A program was
also undertaken testing the Great Fingall reef at depth, which resulted in a significant
re-interpretation (see Figure 5). As a result of this, the resource grew significantly in
FY23 with the mine expected to commence development early in FY24, enabling
production in the second half of FY25. The subsequent ramp up of Great Fingall
establishes a Group gold production pathway to +300koz per annum.
TUCKABIANNA
HYBRID POWER
FACILITY IN
OPERATION
“ Westgold continues to innovate
to reduce our greenhouse
gas emissions and drive our
operating costs down.”
Wayne Bramwell,
Westgold Managing Director
In July 2023, Westgold
commissioned the first of four Hybrid
Power Facilities at its Tuckabianna
Process Plant. The new 17.9MW
facility, replaces the existing diesel
fired power station delivering a
reduction of approximately 15kt of
CO2 equivalent emissions and 10ML
of annual diesel fuel consumption.
The Tuckabianna Hybrid Power
facility incorporates:
– 6MW solar farm fitted with
11,088 photovoltaic panels
(see Figure 6)
– a battery energy storage system with
2.4MW installed capacity; and
– a 9.5MW gas-fuelled power station.
In addition to the now operational
Tuckabianna facility, a further three
new hybrid power facilities are being
constructed across the Group at
Bluebird, Fortnum and Big Bell.
With a combined installed capacity
of 82MW, all facilities are expected to
be online and powering Westgold’s
operations by Q3 FY24.
10
Westgold Resources Limited Annual Report 2023 Figure 5 - Great Fingall FY23 Resource Increase
These facilities are expected to
reduce Westgold’s annual diesel fuel
consumption by 38ML and lower
annual CO2 equivalent emissions
by approximately 57,000t.
Westgold expects its All-In Sustaining
Cost to reduce by approximately
$60/oz1 due to lower cost energy
being provided by these new hybrid
power facilities.
1 At a diesel price assumption of $1.64/L
Figure 6 - Tuckabianna solar farm
11
Westgold Resources Limited Annual Report 2023 OUR OPERATIONS
REVIEW OF OPERATIONS
(CONTINUED)
MEEKATHARRA
The Meekatharra operation is
located around the regional town
of Meekatharra and encompasses
Westgold’s central group of assets
including the historic gold mining
centres of Meekatharra North,
Paddy’s Flat, Yaloginda, Nannine and
Reedy’s (see Figure 7).
Westgold’s Meekatharra assets
include the 1.6-1.8Mtpa Bluebird
processing hub, a 420-person village,
and associated mining infrastructure
required to support a large FIFO
and DIDO mining operation. For
FY23, the Bluebird plant received
underground ore from the Paddy’s
Flat, Triton – South Emu and Bluebird
underground mines, along with excess
ore from Big Bell and supplementary
low-grade stockpiles.
The Bluebird underground mine
has been expanding rapidly since
recommencement of mining in mid
FY22, with further extensions and
opportunities being identified. A
second decline commenced in mid
FY23 to expand the mining footprint
with outputs continuing to rise with
grades well above the original plan.
The South Junction zone to the
South of Bluebird (location of the
access portal) has shown potential
to continue to expand the mine.
Figure 7 - Meekatharra assets
The Bluebird processing hub
performed strongly for the year
treating 1,494,123t, slightly below the
plant’s capacity, mainly due to the
now high percentage of hard rock
feed (minimal oxide). In FY23, the
hub produced 112,614oz of gold at a
metallurgical recovery of 89%.
Near mine exploration at and
around Meekatharra focused on the
extension of Paddy’s Flat, Bluebird-
South Junction and the broader
Reedy’s package.
WESTGOLD
FIXED FORWARD
SALES COMPLETED
IN JULY 2023
In FY23, Westgold reduced its
148koz fixed forward hedge book
by 138koz, such that only 10koz
remained to be delivered into by
the end of July 2023 (see Figure 8).
The fixed forwards were delivered
at an average price of $2,390/oz,
representing a lost opportunity
of ~$70 million2 in revenue. The
remaining 10koz were delivered
in July 2023.
Westgold is now free of its fixed
forward hedges and its gold sales
are leveraged to the current gold
spot price.
During March 2023, when A$ gold
was pushing through $2,900/oz,
the company put in place 30,000oz
of zero cost collars comprising
put options at $2,700/oz and call
options at $3,340/oz for deliveries
of 2,500oz per month from July 2023
to June 2024, subject to the put and
call being struck.
2 Assuming a constant spot gold price of $2,900/oz
12
Westgold Resources Limited Annual Report 2023 At Paddy’s Flat, as production from
the bulk Prohibition lodes draw to a
close, geological work has focused
on extending the known high-grade
thurst and spur systems. Due to
the discreet nature of the high-
grade thrusts and spurs, intense
geological definition activities will be
a hallmark of continued operations
at Paddy’s Flat.
Westgold is increasingly encouraged
by drilling results at Bluebird. This
remarkably consistent high-grade
zone of mineralisation continued
to have its footprint expanded over
FY23. The ore body’s progressive
expansion was complemented
by the successful initial testing of
the broader South Junction lodes
at depth. In FY24, Westgold will
continue extending and infilling
the footprint of both Bluebird and
South Junction, with multiple drill
rigs currently active on surface and
underground.
During FY23, work progressed on
reevaluating the Triton – South Emu
system. Westgold is investigating an
alternative approach to mine planning
and execution at Triton – South Emu
which offers a more sustainable and
economically compelling project
which best utilises the significant
infrastructure and mine development
in place.
Finally, initial testing of the extensions
to the historic Gibraltar mine is also
planned for early FY24.
This strategy protects
the downside of gold
price volatility with the
put option only being
triggered if the gold
price falls to $2,700/oz.
The upside on this small
volume of production is
also capped and again,
only triggered if the gold
price hits $3,340/oz.
148
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109
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83
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60
50
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10
Jun
22
Jul
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Aug
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Sep
22
Oct
22
Nov
22
Dec
22
Jan
23
Feb
23
Mar
23
Apr
23
May
23
Jun
23
Jul
23
Figure 8 - Westgold reduced its remaining forward contracts to 10koz in FY23
13
Westgold Resources Limited Annual Report 2023
OUR OPERATIONS
REVIEW OF OPERATIONS
(CONTINUED)
BRYAH OPERATIONS
The Bryah Operations are centred upon the Fortnum processing hub and incorporate the Fortnum, Horseshoe and Peak
Hill mining areas (see Figure 9). With production from Fortnum averaging approximately 50koz per year, the hub remains
a key contributor to Westgold’s total production.
Figure 9 - Bryah assets
FY23 BRYAH PRODUCTION AND A$ COSTS
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20,000
15,000
10,000
5,000
0
NOTE:
$ 2,414 /oz
$ 2,271 /oz
$ 2,140 /oz
$ 1,696 /oz
15,719 oz
12,900 oz
11,904 oz
13,212 oz
Q1FY23
Q2FY23*
Q3FY23
Q4FY23
Gold Produced
AISC/oz
2,500
2,000
1,500
1,000
500
0
* Q2 FY23 AISC adjusted post audited Half-Year Financial Report for the period ended 31 December 2022
Figure 10 - FY23 Bryah Production and A$ Costs
14
Westgold Resources Limited Annual Report 2023
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In FY23, the Bryah Operations
produced 53,735oz of gold at an AISC
of $2,103/oz (see Figure 10).
The Fortnum operation is located
in the Proterozoic age Bryah
Basin stratigraphy approximately
150km northwest of Meekatharra
and represents the northernmost
group of Westgold assets. These
assets encapsulate the historic
mining centres of Labouchere,
Fortnum, Horseshoe and Peak Hill
which collectively have delivered
approximately 2Moz of reported
gold production.
The processing hub incorporates
the 0.8-0.9Mtpa Fortnum carbon-
in-leach (CIL) processing plant, a
200-person village, airstrip and
associated mining infrastructure
required to support a remote
FIFO operation. Mining output
is currently dominated by the
Starlight underground mine with
supplementary, free on surface low-
grade stocks providing a blended
feedstock to the plant.
Fortnum had a challenging year with
weaker results delivered from the
Starlight underground mine. This
resulted in an operational restructure
focused on optimising the mine plan,
targeting key mining areas including
the Moonlight, Twilight North, Galaxy
and Trev’s lodes.
The processing plant performed well,
treating 802,753t of hard ore blend
at a metallurgical recovery of 96%. A
new pebble crusher will be installed
in FY24 which will help manage the
hard ores and incrementally increase
throughput.
A major extension drilling program
was undertaken at Starlight during
FY23. This program focused on
testing the primary Starlight lodes
over a multi-year window to provide
increased levels of certainty for
mine planning and infrastructure
investment. Pleasingly these works
have resulted in an expansion of the
Mineral Resource base in the order
of 70koz after mining depletion
of 66koz. Drill testing of Starlight
remains ongoing, targeting further
Mineral Resource increases and
translation of these to Ore Reserves
as additional data density is achieved.
Drill testing of the Nightfall system
was also progressed in FY23. The
Nightfall mineralisation sits adjacent
to the Starlight lodes with many
areas already having undergone
capital development. This will allow
for expedited production once the
system is adequately defined.
At the end of FY23 Westgold turned
its attention to the evaluation of its
Peak Hill suite of assets which are
envisaged to provide a medium-
term source feed to the Fortnum
Processing Plant. Significant progress
has been made on locating and
validating historic data, with initial
geological modelling of Peak Hill
mineralisation planned for early FY24.
This modelling will form the basis for
drill testing in the Peak Hill region over
the course of FY24.
Westgold Resources Limited Annual Report 2023
15
OUR OPERATIONS
MINERAL RESOURCES
& ORE RESERVES
Westgold released its annual update of Mineral Resource and Ore Reserve Estimates on the ASX on 11 September 2023.
Shareholders should refer to that announcement for full detail including JORC 2012 appendices. The tables below
summarise them by operational area.
MINERAL RESOURCE STATEMENT – ROUNDED FOR REPORTING 30 JUNE 2023
Project
Measured
Murchison
Bryah
Sub-Total
Indicated
Murchison
Bryah
Sub-Total
Inferred
Murchison
Bryah
Sub-Total
Total
Murchison
Bryah
Grand Total
Tonnes (‘000s)
Grade (g/t)
Ounces Au (‘000s)
9,350
1,865
11,215
44,827
13,724
58,551
33,472
4,115
37,587
87,649
19,704
107,353
3.11
2.36
2.99
2.39
1.88
2.27
2.40
2.40
2.40
2.47
2.03
2.39
936
141
1,078
3,441
828
4,270
2,585
318
2,903
6,963
1,287
8,250
ORE RESERVE STATEMENT – ROUNDED FOR REPORTING 30 JUNE 2023
Project
Proven
Murchison
Bryah
Sub-Total
Probable
Murchison
Bryah
Sub-Total
Total
Murchison
Bryah
Grand Total
Tonnes (‘000s)
Grade (g/t)
Ounces Au (‘000s)
5,076
1,249
6,325
14,384
1,994
16,378
19,461
3,243
22,704
2.67
1.54
2.44
2.89
1.90
2.77
2.83
1.76
2.68
435
62
497
1,335
122
1,457
1,770
184
1,954
Glossary:
Murchison incorporates the Meekatharra and Cue business units.
Bryah incorporates the Fortnum business unit.
16
Westgold Resources Limited Annual Report 2023
The Mineral Resources by mining project are tabulated below:
MURCHISON OPERATIONS
MINERAL RESOURCE STATEMENT - ROUNDED FOR REPORTING 30 JUNE 2023
Measured
Indicated
Inferred
Total
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
5,498
3.08
544
9,917
1,030
8,942
785
24,357
Project
Big Bell
Cuddingwarra
Day Dawn
85
58
1.66
1.73
5
3
1,600
3,776
Tuckabianna
267
3.54
30
3,448
3.23
1.63
4.63
2.78
Tuckabianna
Stockpiles
Meekatharra North
Nannine
481
0
68
Paddy's Flat
1,033
Reedy's
Yaloginda
Bluebird Stockpiles
Total
458
745
656
9,350
1.64
0.00
2.55
4.03
3.74
4.30
1.50
3.11
BRYAH OPERATIONS
25
0
6
134
55
103
32
3,744
0.70
97
859
1.98
2.06
10,593
1.70
3,055
2.55
7,737
1.93
0
0.00
2.73
1.50
4.29
2.63
0.00
2.11
2.26
1.86
2.44
1.48
597
2,339
2,899
0
75
340
2,415
8,883
6,981
0
0.00
84
562
308
85
6
57
579
251
481
0
29
322
245
0
5
25
144
698
332
0
Ounces
Au
(‘000s)
2,358
117
887
584
110
11
87
857
3.01
1.59
4.47
2.75
0.81
2.04
2.14
1.90
2,282
6,173
6,614
4,225
172
1,267
14,042
12,396
2.52
1,004
15,464
656
1.84
1.50
916
32
936
44,827
2.39
3,441
33,472
2.40
2,585
87,649
2.47
6,963
MINERAL RESOURCE STATEMENT - ROUNDED FOR REPORTING 30 JUNE 2023
Measured
Indicated
Inferred
Total
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
1,019
3.53
116
4,446
2,078
3.05
204
7,543
0
0
846
1,865
0.00
0.00
0.94
2.36
0
0
25
141
2.50
2.09
1.55
0.70
357
85
376
10
1,266
7,547
464
183
1,838
16
1.43
1.78
0.54
2.40
8
1,449
105
9,385
0
1,326
0.85
2.79
2.01
1.60
677
93
481
36
13,724
1.88
828
4,115
318
19,704
2.03
1,287
Project
Fortnum
Horseshoe
Peak Hill
Stockpiles
Total
Westgold Resources Limited Annual Report 2023
17
OUR OPERATIONS
MINERAL RESOURCES & ORE
RESERVES (CONTINUED)
The Mineral Resources by mining project are tabulated below:
MURCHISON OPERATIONS
MINERAL RESOURCE STATEMENT COMPARISON
Project
Big Bell
Cuddingwarra
Day Dawn
Tuckabianna
Tuckabianna Stockpiles
Meekatharra North
Nannine
Paddy's Flat
Reedy's
Yaloginda
Bluebird Stockpiles
Total
2022
2023
Change
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
2,358
4,272
20,085
2.79
1,802
24,357
2,820
1.74
6,648
10,842
4,358
172
1,895
14,013
3.54
2.49
0.78
2.04
2.18
1.93
158
756
867
110
11
132
871
2,282
6,173
6,614
4,225
172
1,267
14,042
3.01
1.59
4.47
2.75
0.81
2.04
2.14
1.90
117
887
584
110
11
87
857
12,426
2.53
1,009
12,396
2.52
1,004
15,672
648
1.72
1.25
865
15,464
26
656
1.84
1.50
916
32
-538
-475
-4,227
-133
0
-627
28
-29
-208
8
0
0
1
0
0
0
0
0
0
0
0
556
-41
131
-283
0
0
-45
-15
-5
50
6
89,579
2.29
6,608
87,649
2.47
6,963
-1,930
-5.73
355
BRYAH OPERATIONS
MINERAL RESOURCE STATEMENT - COMPARISON
Project
Fortnum
Horseshoe
Peak Hill
Stockpiles
Total
2022
2023
Change
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
8,515
1,449
9,385
2.64
2.01
1.60
1,302
0.86
721
93
481
36
7,543
1,449
9,385
2.79
2.01
1.60
1,326
0.85
677
93
481
36
-972
0
0
24
0
0
0
0
Ounces
Au
(‘000s)
-45
0
0
0
20,651
2.01
1,332
19,704
2.03
1,287
-948
1.47
-45
18
Westgold Resources Limited Annual Report 2023
The Ore Reserves by mining project are tabulated below:
MURCHISON OPERATIONS
ORE RESERVE STATEMENT - ROUNDED FOR REPORTING 30 JUNE 2023
Project
Big Bell
Cuddingwarra
Day Dawn
Tuckabianna
Tuckabianna Stockpiles
Meekatharra North
Nannine
Paddy's Flat
Reedy's
Yaloginda
Bluebird Stockpiles
Tonnes
(‘000s)
3,573
0
0
0
481
0
0
117
57
192
656
Total
5,076
BRYAH OPERATIONS
Proven
Grade
(g/t)
2.85
0.00
0.00
0.00
1.64
0.00
0.00
3.54
3.35
5.10
1.50
2.67
Probable
Total
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
327
6,270
0
0
0
25
0
0
13
6
31
32
435
98
1,944
683
3,744
0
262
420
398
566
0
14,384
3.31
1.77
5.08
3.00
0.70
0.00
1.93
3.47
3.42
4.81
0.00
2.89
668
6
317
66
85
0
16
47
44
88
0
9,843
98
1,944
683
4,225
0
262
538
455
757
656
1,335
19,461
3.14
1.77
5.08
3.00
0.81
0.00
1.93
3.48
3.41
4.89
1.50
2.83
Ounces
Au
(‘000s)
995
6
317
66
110
0
16
60
50
119
32
1,770
ORE RESERVE STATEMENT - ROUNDED FOR REPORTING 30 JUNE 2023
Project
Fortnum
Horseshoe
Peak Hill
Stockpiles
Total
Proven
Probable
Total
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
403
0
0
846
1,249
2.82
0.00
0.00
0.94
1.54
37
0
0
25
62
1,172
357
0
464
1,994
2.29
2.18
0.00
0.70
1.90
86
25
0
10
122
1,576
357
0
1,310
3,243
2.42
2.18
0.00
0.85
1.76
123
25
0
36
184
Westgold Resources Limited Annual Report 2023
19
OUR OPERATIONS
MINERAL RESOURCES & ORE
RESERVES (CONTINUED)
The movement in Ore Reserves over the past year are tabulated below:
MURCHISON OPERATIONS
ORE RESERVE STATEMENT COMPARISON
Project
Big Bell
Cuddingwarra
Day Dawn
Tuckabianna
Tuckabianna Stockpiles
Meekatharra North
Nannine
Paddy's Flat
Reedy's
Yaloginda
Bluebird Stockpiles
Total
2022
2023
Change
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
8,811
710
1,289
1,075
4,324
0
718
889
943
1,000
648
3.01
1.75
6.92
2.54
0.79
0.00
1.82
4.37
3.34
3.70
1.25
854
9,843
3.14
1.77
5.08
3.00
98
1,944
683
4,225
0.81
0
262
538
455
757
656
0.00
1.93
3.48
3.41
4.89
1.50
995
1,033
6
317
66
110
0
16
60
50
119
32
-613
655
-393
-99
0
-456
-352
-489
-243
8
0
0
-2
0
0
0
0
-1
0
1
0
141
-35
30
-22
1
0
-26
-65
-51
0
6
40
287
88
109
0
42
125
101
119
26
20,410
2.73
1,791
19,461
2.83
1,770
-949
0.67
-21
BRYAH OPERATIONS
ORE RESERVE STATEMENT COMPARISON
2022
2023
Change
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
Tonnes
(‘000s)
Grade
(g/t)
Ounces
Au
(‘000s)
2,886
761
581
2.19
1.84
2.21
1,285
0.86
204
1,576
2.42
2.18
0.00
357
0
1,310
0.85
123
-1,310
25
0
36
-403
-581
24
0
0
-2
0
-81
-20
-41
0
45
41
36
5,512
1.84
325
3,243
1.76
184
-2,270
1.95
-142
Project
Fortnum
Horseshoe
Peak Hill
Stockpiles
Total
20
Westgold Resources Limited Annual Report 2023
COMPLIANCE AND
FORWARD-LOOKING STATEMENTS
EXPLORATION TARGETS, EXPLORATION RESULTS AND MINERAL RESOURCES
The information in this report that relates to Exploration results and Mineral Resource Estimates is compiled by Westgold
technical employees and contractors under the supervision of Mr. Jake Russell B.Sc. (Hons), who is a member of the
Australian Institute of Geoscientists. Mr Russell is a full-time employee of the company and has sufficient experience
which is relevant to the styles of mineralisation and types of deposit under consideration and to the activities which he is
undertaking 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 Russell consents to the inclusion in this report of the matters
based on his information in the form and context in which it appears. Mr Russell is eligible to participate in short and long-
term incentive plans of the company.
ORE RESERVES
The information in this report that relates to Ore Reserve is based on information compiled by Mr. Leigh Devlin B.Eng.
MAusIMM. Mr. Devlin has sufficient experience which is relevant to the styles of mineralisation and types of deposit under
consideration and to the activities which they are undertaking to qualify as a Competent Person as defined in the 2012
Editions of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC 2012)”.
Mr. Devlin consents to the inclusion in this report of the matters based on his information in the form and context in which
it appears. Mr. Devlin is a full-time senior executive of the Company and is eligible to and may participate in short-term and
long-term incentive plans of the Company as disclosed in its annual reports and disclosure documents.
FORWARD LOOKING STATEMENTS
These materials prepared by Westgold Resources Limited (or “the Company”) include forward looking statements. Often,
but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”,
“will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or other similar words and may include,
without limitation, statements regarding plans, strategies and objectives of management, anticipated production or
construction commencement dates and expected costs or production outputs.
Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause
the Company’s actual results, performance and achievements to differ materially from any future results, performance
or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange
fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature
of exploration and project development, including the risks of obtaining necessary licenses and permits and diminishing
quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the Company
operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and
retention of personnel, industrial relations issues and litigation.
Forward looking statements are based on the Company and its management’s good faith assumptions relating to the
financial, market, regulatory and other relevant environments that will exist and affect the Company’s business and
operations in the future. The Company does not give any assurance that the assumptions on which forward looking
statements are based will prove to be correct, or that the Company’s business or operations will not be affected in any
material manner by these or other factors not foreseen or foreseeable by the Company or management or beyond the
Company’s control.
Although the Company attempts and has attempted to identify factors that would cause actual actions, events or results
to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual
results, performance, achievements or events not to be as anticipated, estimated or intended, and many events are beyond
the reasonable control of the Company.
Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements
in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant
stock exchange listing rules, in providing this information the Company does not undertake any obligation to publicly
update or revise any of the forward-looking statements or to advise of any change in events, conditions or circumstances.
Westgold Resources Limited Annual Report 2023
21
DIRECTORS’ REPORT
The Directors submit their report together with the
financial report of Westgold Resources Limited (Westgold
or the Company) and of the Consolidated Entity, being the
Company and its controlled entities (the Group), for the
year ended 30 June 2023.
DIRECTORS
The names and details of the Company’s Directors in office
during the financial year and until the date of this report
are as follows. Directors were in office for this entire period
unless otherwise stated.
Names, qualifications, experience and special
responsibilities
Hon. Cheryl L Edwardes AM - Non-Executive Chair
(Appointed 28 March 2022)
Ms Edwardes is a highly credentialed and experienced
company director and Chair. A solicitor by profession and
former Attorney-General for Western Australia, Minister for
Environment and Minister for Labour Relations. Ms Edwardes
has extensive experience and knowledge of Western
Australia’s legal and regulatory framework relating to mining
projects, environmental, native title, heritage and land access.
During the past three years, she has also served as a
director of the following public listed companies:
– Kalium Lakes Limited (appointed 25 November 2022;
resigned 3 August 2023);
– Flinders Mines Limited (appointed 17 June 2019);
– Nuheara Limited (appointed 2 January 2020); and
– Vimy Resources Limited (appointed 26 May 2014;
resigned 4 August 2022).
Wayne C Bramwell - Managing Director
(Appointed Non-Executive Director 3 February 2020)
Mr Bramwell (BSc Extractive Metallurgy, Grad Dip
Business, MSc (Min Econ)) is a metallurgist and mineral
economist, experienced director and mining executive with
extensive project and corporate development, executive
management and governance expertise in precious and
base metal companies spanning nearly three decades.
He holds a Bachelor of Science in Extractive Metallurgy,
a Graduate Diploma in Business, a Master of Science in
Mineral Economics and is a graduate of the Australian
Institute of Company Directors.
During the past three years, he has served as a director of
the following public listed companies:
– CZR Resources Limited (appointed 3 November 2020;
–
–
–
resigned 19 February 2021);
Azure Minerals Limited (appointed 14 October 2020;
resigned 19 February 2021);
Ardea Resources Limited (appointed 29 January 2018;
resigned 3 July 2020);
Vimy Resources Limited (appointed 18 October 2021;
resigned 4 August 2022); and
– Deep Yellow Limited (appointed 4 August 2022;
resigned 31 January 2023).
22
Westgold Resources Limited Annual Report 2023
Fiona J Van Maanen - Non-Executive Director
(Appointed 6 October 2016)
Mrs Van Maanen is a CPA, holds a Bachelor of Business
(Accounting) and a Graduate Diploma in Company Secretarial
Practice. Mrs Van Maanen has significant experience in
corporate governance, financial management and accounting
in the mining and resources industry. Mrs Van Maanen serves
on Westgold’s Audit, Risk and Compliance Committee and
Remuneration and Nomination Committee.
During the past three years, she has served as a director of
Pantoro Limited (appointed 4 August 2020).
Gary R Davison - Non-Executive Director
(Appointed 1 June 2021)
Mr Davison (FAusIMM (CP)), is a highly regarded
mining engineer with over 45 years of worldwide mining
experience. Gary holds a Diploma in Engineering (Mining)
and a Masters in Mineral and Energy Economics. He is
also the Managing Director of Australia’s premier mining
consultancy Mining One Pty Ltd. Mr Davison serves on
Westgold’s Audit, Risk and Compliance Committee and
Remuneration and Nomination Committee.
During the past three years, he has served as a director of
Nagambie Resources Ltd (appointed 15 May 2019, resigned
8 September 2021).
Julius L Matthys - Non-Executive Director
(Appointed 28 March 2022)
Mr Matthys has substantial corporate experience having
spent 36 years in the resources sector. He has held senior
executive roles in large corporate entities including
President of Worsley Alumina JV, Marketing Director at
BHP Iron Ore, Alumina and Aluminium. Mr Matthys was
previously Chair of gold producer Doray Minerals Limited,
managing its merger with Silver Lake Resources. He
currently serves as a Non-Executive Director of Quintis.
Mr Matthys has not held any public company directorships
in the past three years.
David N Kelly - Non-Executive Director
(Appointed 5 November 2023)
Mr Kelly is a geologist with 35 years’ experience in
exploration, operations management, mine planning,
project evaluation, business development and project
finance. Most recently he was employed by Resolute
Mining Limited as Executive General Manager – Strategy
and Planning, following 2 years as Chief Operating Officer.
Prior to joining Resolute, Mr Kelly was a Director of
Optimum Capital, an independent advisory house
servicing junior and mid-tier miners. He previously worked
with groups such as Consolidated Minerals Limited, WMC
Resources Limited, Central Norseman Gold Corporation,
NM Rothschild and Sons and Investec Australia and has
held several non-executive directorships in mining and
exploration companies, including Predictive Discovery,
Renaissance Minerals and Turaco Gold.
for the year ended 30 June 2023FINANCIAL REPORT Peter Schwann - Non-Executive Director
(Appointed 2 February 2017, Resigned 26 July 2022)
Mr Schwann (Assoc. in Applied Geology, FAIG, MSEG) is a highly experienced, internationally recognised geologist and
mining executive. Mr Schwann has broad experience across multiple commodities with extensive geological capability as
well as significant operational management. Mr Schwann served on the Company’s Audit, Risk and Compliance Committee
and Remuneration and Nomination Committee.
During the past three years, he has served as a director of the following public listed company:
– Aruma Resources Limited (Appointed 10 February 2010)
COMPANY SECRETARY
Susan Park (Appointed 5 April 2022)
Ms Park is a governance professional with over 25 years’ experience in the corporate finance industry and extensive
experience in Company Secretary and Non-Executive Director roles in ASX, AIM and TSX listed companies. Ms Park holds
a Bachelor of Commerce from the University of Western Australia, is a Member of the Australian Institute of Chartered
Accountants, a Fellow of the Financial Services Institute of Australasia, a Graduate Member of the Australian Institute of
Company Directors and a Graduate Member of the Governance Institute of Australia. She is currently Company Secretary
of several ASX listed companies.
Lisa Smith (Appointed 20 December 2019, resigned 11 October 2022)
Ms Smith holds a Bachelor of Laws and a Bachelor of Commerce and brings over 17 years legal experience across a
broad range of practice areas including commercial and corporate, regulation and compliance as well as experience with
secretarial duties. Ms Smith has previously acted as principal lawyer for a private resources industry services firm and has
substantial policy and advocacy experience.
INTERESTS IN THE SHARES AND PERFORMANCE RIGHTS OF THE COMPANY
As at the date of this report, the interests of the Directors in the shares and rights of the Company were:
Director
Hon. CL Edwardes AM
WC Bramwell
FJ Van Maanen
GR Davison
JL Matthys
DN Kelly1
Total
1.
Appointed on 5 November 2022.
Fully Paid
Ordinary
Shares
Performance
Rights
6,122
–
50,000
587,668
435,521
–
112,658
–
–
–
–
–
604,301
587,668
PRINCIPAL ACTIVITIES
The principal activities during the year of the Group were the exploration, development and operation of gold mines,
primarily in Western Australia.
EMPLOYEES
The Group had 918 employees at 30 June 2023 (2022: 1,077).
Westgold Resources Limited Annual Report 2023
23
CORPORATE OVERVIEW
Westgold is a progressive and innovative gold producer with a large and strategic land package in the Murchison and Bryah
regions of Western Australia. After listing on the ASX in December 2016 the company has consolidated over 1,300 km2 of
mining titles across three key business units. These units encompass the Fortnum operations (the Bryah region in the north),
the Meekatharra operations (in the centre of our tenure) and the Cue operations (in the south of our Murchison portfolio)
and are supported by Westgold’s wholly owned mining services unit.
The gold endowment of the region is extensive with the Murchison being one of the largest historic goldfields in Western
Australia. To date the Murchison has produced more than 10 million ounces of gold with Westgold reporting a total Mineral
Resource of 7.9 million ounces and 2.1 million ounces of gold in Ore Reserves (refer ASX announcement 6 October 2022).
During FY23, Westgold consolidated its operations to four underground mines and three processing plants and produced
257,116 ounces of gold from its Bryah and Murchison operations.
CORPORATE STRUCTURE
Westgold’s corporate structure is depicted below.
WESTGOLD
RESOURCES LIMITED
ACN 009 260 306
ARAGON RESOURCES
PTY LTD
BIG BELL GOLD OPERATIONS
PTY LTD
WESTGOLD MINING
SERVICES PTY LTD
ACN 114 714 662
ACN 090 642 809
ACN 080 756 172
Bryah
Operations
Murchison
Operations
Mining
Services
24
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ REPORT OPERATING AND FINANCIAL REVIEW
OPERATING RESULTS
The Group’s full year gold production was 257,116 ounces (FY22 - 270,884 ounces). Overall, the results reflect a year of
transition following a strategic review that saw the business reset its model to focus on safe and profitable gold production.
Three underground operations were put on care and maintenance, all business units restructured and Group expenditure
and commercial processes reviewed.
These actions over the year are reflected in the following key measures:
– Consolidated revenue increased by 1% to $654,371,234 (2022: $647,576,618);
– Consolidated total cost of sales increased by 2% to $631,598,901 (2022: $620,300,818);
– Profit before income tax and non-cash impairment decreased by 10% to $13,949,469 (2022: $15,448,892); and
– Profit after income tax and non-cash impairment increased by 109% to a gain of $10,003,484 (2022: loss $111,119,291).
REVIEW OF FINANCIAL CONDITION
The Consolidated Statement of Cash Flows reflects a closing cash and cash equivalents of $176,411,855
(2022: $182,701,502).
Operating Activities
Group cash flow generated by operating activities decreased on that of the previous year with a total inflow of $168,433,218
(2022: $179,855,454).
Investing Activities
Cash flows used in investing activities across the Group decreased on that of the previous year with a total outflow of
$158,074,095 (2022: $201,009,289).
Cash flow applied to investing activities in the current year relate to key growth capital at the Big Bell underground mine
(CGO), Starlight underground mine (FGO) and the Bluebird and Paddy’s Flat underground mines (MGO), along with
investment in the new power stations for the Clean Energy Transition project (CET). Other capital investment was sustaining
capital in all of the operating underground mines to maintain developed tonnes and production output at similar levels.
Total capital investment in mine properties and development, exploration and evaluation expenditure and property, plant
and equipment during the current year was $147,347,357 (2022: $239,019,046), broken into key operations as follows:
– Murchison $119,132,722 (2022: $201,562,547);
– Bryah $28,214,635 (2022: $37,456,499); and
Capital commitments of $26,168,651 (2022: $17,715,233) existed at the reporting date, principally relating to the purchase of
plant and equipment.
Exploration activities continued at all operations during the year with $18,909,901 (2022: $18,190,290) expended.
Financing Activities
Net cash flows from financing activities amounted to an outflow of $16,648,770 (2022: inflow of $53,171,308).
–
The Group’s interest-bearing loans and borrowings decreased to $27,490,818 (2022: $42,959,811) with marginal additions
to the mobile mining fleet with the expanded growth activities.
Westgold Resources Limited Annual Report 2023
25
SHARE ISSUES DURING THE YEAR
There has been no share issues during the year.
DIVIDENDS
No dividend will be paid to members in respect of the year ended 30 June 2023.
The Board did not declare a dividend for the 2023 reporting year. The decision was made in order for Westgold to maintain
its balance sheet strength as it continues its operational transformation on building cash and enhance profitability on a
sustainable basis and critically ensure that our immediate growth ambitions are funded from our existing cash resources.
This position will be reviewed by the Board next reporting period.
REVIEW OF OPERATIONS
In FY23, Westgold delivered 257,116 ounces from its Murchison and Bryah operations whilst continuing to define, explore
and develop the next suite of mineral assets within the Westgold landholding.
Westgold remains the dominant gold mining company in the Bryah and Murchison region. The Company has ≈ 350 mining
titles covering 1,300 km2 across this highly prospective region and now operates four underground mines and three
processing plants.
Westgold is an owner-operator of all its underground mines. This vertical integration benefits Westgold by providing greater
cost control and operating flexibility across the Company’s assets.
Murchison Operations
The Murchison Operations are located around the regional towns of Meekatharra and Cue in the mid-west region of
Western Australia and incorporates the Meekatharra and Cue Gold Operations.
Revenue from the Murchison Operations improved to $517,503,405 (2022: $489,358,532) and segment profits increased
to $14,951,974 (2022: $9,462,740).
Gold output for the year was 203,382 ounces at a C1 Cash Cost of $1,686 per ounce and an AISC of $1,971 per ounce as
disclosed in the table on page 28.
Meekatharra Gold Operations (MGO)
MGO is located around the regional town of Meekatharra and encompasses Westgold’s central group of assets including
the historic gold mining centres of Meekatharra North, Paddy’s Flat, Yaloginda, Nannine and Reedy’s.
The MGO processing hub incorporates the 1.6-1.8 Mtpa Bluebird processing plant, a 420-person village, and associated
mining infrastructure required to support mining operations. The Bluebird plant receives underground ore from the Paddy’s
Flat and Bluebird underground mines, surplus ore from CGO and supplementary lower grade surface stockpiled ore.
In addition to current Mineral Resources and Ore Reserves, MGO has a number of exploration targets which should
underwrite sustainable gold production at the operations beyond existing targets, including:
– Extensions to the Bluebird and Paddy’s Flat Mines, along with the potential inclusion of South Junction;
–
– New targets across the central package where drilling under 100m in depth is sparse, with advanced targets including the
Triton Deeps and Boomerang in the Reedy Mining Area; and
GNH and Gibraltar deposits.
26
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ REPORT Cue Gold Operations (CGO)
CGO is located around the regional town of Cue and encompasses Westgold’s southern-most group of Murchison assets.
This package includes two of Australia’s most prolific past producers in the Big Bell mine (2.6 million ounces) and the Great
Fingall mine (1.2 million ounces).
The CGO processing hub incorporates the 1.4 Mtpa Tuckabianna processing plant, a 148-person village at Big Bell, a
266-person village at Cue and associated mining infrastructure to support mining operations.
The Tuckabianna plant receives underground ore from the large Big Bell underground, with supplementary feed provided
by lower grade surface stockpiles. Following the completion of ramp up and commencement of steady state production in
April 2022, Big Bell has consistently delivered design levels, producing 1.1Mt of ore at 2.6g/t for 95koz contained ounces of
gold in FY23.
In addition to current Mineral Resources and Ore Reserves, CGO has a number of development projects and exploration
targets which should underwrite growth in gold production at the operations, including:
– Great Fingall and Golden Crown – approved by the Board for development in August 2023;
– Fender Mine – a shallow underground mine beneath Westgold’s Fender open pit expected to commence mining in
October 2023;
– Caustons – on the Tuckabianna trend, close to the mill and high potential for underground mining;
– Additional shallow targets on the Big Bell line of lode beneath the 700, 1600 and the Shocker pits; and
– Open pit and underground targets within the Cuddingwarra Mining centre.
Bryah Operations
The Bryah Operations are centred upon the Fortnum Gold Operation (FGO). FGO is located within the Proterozoic age
Bryah Basin stratigraphy approximately 150 km northwest of Meekatharra and represents the northernmost group of
Westgold assets. These assets encapsulate the historic mining centres of Labouchere, Fortnum, Horseshoe and Peak Hill
which collectively has delivered approximately 2 million ounces of reported gold production.
The FGO processing hub incorporates the 0.9 Mtpa Fortnum carbon-in-leach (CIL) processing plant, a 200-person village,
airstrip and associated mining infrastructure required to support mining operations. Mining output is currently dominated
by the Starlight underground mine with supplementary, free on surface low grade stockpiles providing a blended feedstock
to the plant.
Gold output in FY23 was 53,735 ounces at a C1 Cash Cost of $1,780 per ounce and an all-in sustaining cost (AISC) of
$2,103 per ounce as disclosed in the table on page 28.
The decrease in the gold output, though partially offset by the increase in the gold price, resulted in an overall decrease in
revenue to $136,867,829 (2022: $158,218,086). Segment profits decreased to $7,820,360 (2022: $17,702,894).
In addition to current Mineral Resources and Ore Reserves, FGO has a number of exploration targets which should
underwrite sustainable gold production at the operations beyond existing targets, including:
extensions to the Starlight underground mine;
–
– open pit mining from the historic Yarlarweelor, Nathans and Labouchere mines;
–
– new targets within the proximate Peak Hill tenements.
the Regent and Messiah deposits; and
Westgold Resources Limited Annual Report 2023
27
Westgold Operating Performance by Operation
Year Ended 30 June 2023
MURCHISON
BRYAH
GROUP
Physical Summary
UG Ore Mined
UG Grade Mined
Ore Processed
Head Grade
Recovery
Gold Produced
Gold Sold
Achieved Gold Price
Cost Summary
Mining
Processing
Admin
Stockpile Adjustments
C1 Cash Cost (produced)1
Royalties
Corporate Costs
Sustaining Capital
All-in Sustaining Costs2
Units
t
2,256,023
687,395
2,943,418
g/t
2.9
2.4
2.8
t
2,822,282
802,753
3,625,035
g/t
%
oz
oz
2.5
88
203,382
202,026
$/oz
2,556
2.2
96
53,735
53,983
2,556
2.5
90
257,116
256,009
2,556
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
1,052
1,083
1,058
467
104
64
560
120
17
487
107
54
1,686
1,780
1,706
96
26
163
1,971
65
55
203
2,103
90
32
172
1,999
28
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ REPORT
Year Ended 30 June 2022
MURCHISON
BRYAH
GROUP
Physical Summary
UG Ore Mined
UG Grade Mined
OP Ore Mined
OP Grade Mined
Ore Processed
Head Grade
Recovery
Gold Produced
Gold Sold
Achieved Gold Price
Cost Summary
Mining
Processing
Admin
Stockpile Adjustments
C1 Cash Cost (produced)1
Royalties
Corporate Costs
Sustaining Capital
All-in Sustaining Costs2
Units
t
g/t
t
g/t
2,433,591
705,868
3,139,459
2.7
669,454
1.6
2.9
–
–
2.8
669,454
1.6
t
2,872,855
825,070
3,697,925
g/t
%
oz
oz
2.5
89
204,937
203,986
$/oz
2,399
1,158
406
88
(165)
2.6
95
65,947
65,719
2,408
822
370
76
26
2.5
90
270,884
269,705
2,401
1,076
397
84
(119)
1,487
1,294
1,438
95
20
146
62
36
133
87
24
143
1,748
1,525
1,692
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
$/oz
1.
2.
C1 Cash Cost (C1): represents the cost for mining, processing and administration after accounting for movements in inventory
(predominantly ore stockpiles). It includes net proceeds from by-product credits but excludes the cost of royalties and capital costs for
exploration, mine development and plant and equipment.
All-in Sustaining Cost (AISC): is made up of the C1 cash cost plus royalty expense, sustaining capital expense and general corporate and
administration expenses.
CORPORATE
Gold Forward Contracts
At the end of the financial year, the Group had unrecognised sales contracts for 10,000 ounces at an average price of
$2,459 per ounce ending in July 2023, which the Group will deliver physical gold to settle (refer to Note 5).
During 2023, the Group entered into zero-cashflow collar contracts whereby the Group purchased a total of 30,000
ounces of gold call options and sold a total of 30,000 ounces of gold put options contracts with equal and offsetting values
at inception. These contracts are comprised of put options of $2,700/oz and call options of $3,340/oz. All of these contracts
were outstanding at 30 June 2023 and mature over the period July 2023 to June 2024.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Total equity increased to $598,339,298 (2022: $587,767,457). This included share based payments of $1,039,025.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
There have been no other significant events after the balance date.
Westgold Resources Limited Annual Report 2023
29
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The Group is expected to continue exploration, development, operations and production and marketing of gold bullion in
Australia and will continue the development of its gold exploration projects.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group’s operations are subject to the relevant Commonwealth and State environmental protection legislations.
The Group holds various environmental licenses issued under these laws and these licenses include conditions and
regulations in relation to specifying limits on discharges into the air, surface water and groundwater, the management and
storage of hazardous substances and the rehabilitation of areas disturbed during the course of exploration, mining and
processing activities.
The Board monitors all environmental performance obligations. Our operations are subjected to regular Government
agency audits and site inspections. There have been zero significant environmental incidents, material breaches of the
Group’s environmental licenses and all mining and exploration activities have been undertaken in compliance with the
relevant environmental regulations.
PERFORMANCE RIGHTS
Employee rights
During the year ending 30 June 2023, the Company granted 2,182,314 unlisted Performance Rights (WGXAG) to senior
management under the Employee Performance Rights Plan. Included in this issue were 385,233 Performance Rights
granted to the Managing Director.
The principal terms of the Employee Rights are:
The Performance Rights have been issued for nil consideration;
–
– Each Performance Right carries an entitlement to one fully paid ordinary share in the Company for each Performance
Right vested;
– Vesting only occurs after the end of the Performance Periods (30 June 2025) and the number of Performance Rights that
vest (if any) will depend on:
– Relative Total Shareholder Return;
– Absolute Total Shareholder Return;
– Absolute Earnings Per Share;
– Ore Reserve Growth;
– Any Performance Rights that do not vest after the end of the Performance Periods will automatically lapse; and
– No amount is payable by a holder of Performance Rights in respect of the shares allocated upon vesting.
Unissued shares
As at the date of this report, unissued ordinary shares under share based payment arrangements are:
Performance Rights (Rights)
Rights – Tranche 5 - Directors
Rights – Tranche 5 - Employees
Rights – Tranche 6 - Directors
Rights – Tranche 6 - Employees
Total
Number of
shares
Exercise
Price
Expiry Date
202,435
958,623
385,233
2,182,314
3,728,605
Zero
Zero
Zero
Zero
30 June 2024
30 June 2024
30 June 2025
30 June 2025
Holders of these instruments do not have any right, by virtue of the instrument, to participate in any share issue of the
Company or any related body corporate.
Shares issued as a result of exercising performance rights
During the financial year no listed rights were converted to acquire fully paid ordinary shares in the Company, refer to
Note 25 for further details.
30
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ REPORT INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Company paid a premium in respect of a contract of insurance to insure Directors and Officers
of the Company and related bodies corporate against those liabilities for which insurance is permitted under section 199B of
the Corporations Act 2001. Disclosure of the nature of the liabilities and the amount of the premium is prohibited under the
conditions of the contract of insurance.
INDEMNIFICATION OF AUDITORS
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its
audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment
has been made to indemnify Ernst & Young during or since the financial year.
DIRECTORS’ MEETINGS
The number of meetings of Directors (including meetings of committees of Directors held during the year and the number
of meetings attended by each Director) was as follows:
Directors
Audit, Risk and Compliance
Committee
Remuneration and
Nomination Committee
Eligible to
attend
Attended
Eligible to
attend
Attended
Eligible to
attend
Attended
14
14
14
14
14
10
–
14
14
14
13
14
9
–
–
–
4
4
4
2
–
–
–
4
4
4
2
–
–
–
3
3
3
1
1
–
–
3
3
3
1
–
Hon. CL Edwardes AM
WC Bramwell
FJ Van Maanen
GR Davison
JL Matthys
DN Kelly1
PB Schwann2
1
2
Appointed on 5 November 2022.
Resigned on 26 July 2022.
Committee Membership
As at the date of this report, the Company had an Audit, Risk and Compliance Committee and a Remuneration and
Nomination Committee of the Board of Directors. Members acting on these committees during the year were:
Audit, Risk and Compliance Committee
Remuneration and Nomination Committee
FJ Van Maanen – Chair
JL Matthys
GR Davison
DN Kelly1
PB Schwann2
1
2
Appointed to the Committee on 5 November 2022.
Resigned on 26 July 2022.
JL Matthys – Chair
FJ Van Maanen
GR Davison
DN Kelly1
PB Schwann2
Westgold Resources Limited Annual Report 2023
31
REMUNERATION REPORT (AUDITED)
CONTENTS
1. Remuneration report overview
2. Remuneration and Nomination Committee responsibilities
3. Remuneration governance
4. Non-Executive Director remuneration
5. Executive remuneration
6. Performance and executive remuneration outcomes
7. Executive employment arrangements
8. Additional statutory disclosure
1. REMUNERATION REPORT OVERVIEW
The Directors of Westgold Resources Limited present the Remuneration Report (the Report) for the Group for the year
ended 30 June 2023 (FY2023). This Report forms part of the Directors’ Report and has been audited in accordance with
section 300A of the Corporations Act 2001 and its regulations.
The Report details the remuneration arrangements for Key Management Personnel (KMP) being the:
– Non-Executive Directors (NEDs); and
– Executive directors and senior executives (collectively “the executives”).
KMP are those who directly, or indirectly, have authority and responsibility for planning, directing and controlling the major
activities of the Group.
Details of KMP of the Group are set out below:
Name
(i)
Non-Executive
Directors
Position
Appointed
Resigned
Hon. CL Edwardes AM
Non-Executive Chair
FJ Van Maanen
Non-Executive Director
GR Davison
JL Matthys
DN Kelly
PB Schwann
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
28/03/2022
06/10/2016
01/06/2021
28/03/2022
05/11/2022
02/02/2017
(ii) Managing Director
WC Bramwell
Managing Director
24/05/2022
(iii)
Senior Executives
SH Heng
PW Wilding
L Smith
Chief Financial Officer
Chief Operating Officer
02/08/2021
11/10/2022
Company Secretary & General Counsel
20/12/2019
02/11/2022
–
–
–
–
–
26/07/2022
–
–
–
32
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) 2.
REMUNERATION AND NOMINATION COMMITTEE RESPONSIBILITIES
Remuneration and Nomination Committee duties
The Remuneration and Nomination Committee is a subcommittee of the Board and are chartered to:
–
–
–
–
Oversee formulation and review of the Company’s organisational development, succession planning for the Group’s
Executive Directors and senior executives;
Approve, review and refer to the Board matters relating to the appointment and the removal of executives who report
directly to the Managing Director and or Executive Director to ensure that an appropriate Board succession plan is in
place;
Ensure that the performance of the Board and its members is regularly reviewed; and
Assist the Chair in advising Directors about their performance and possible retirement.
Remuneration report at FY2022 AGM
The FY2022 remuneration report received positive shareholder support at the FY2022 AGM with a vote of 94% in favour.
Director succession planning
The Remuneration and Nomination Committee continually considers the changing needs of the Group with the aim to
maintain consistent governance over all activities.
During the financial year, Westgold appointed David Kelly as a Non-Executive Director on 5 November 2022.
The Board structure as at 30 June 2023 is as follows:
Name
Hon. CL Edwardes AM
WC Bramwell
FJ Van Maanen
GR Davison
JL Matthys
DN Kelly
Position
Non-Executive Chair
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
3. REMUNERATION GOVERNANCE
The Remuneration and Nomination Committee makes recommendations to the Board on:
– Non-Executive Director fees;
– Executive remuneration (Directors and senior executives); and
–
The executive remuneration framework and incentive plan policies.
The Remuneration and Nomination Committee assess the appropriateness of the nature and amount of remuneration
of Non-Executive Directors and executives on a periodic basis by reference to relevant employment market conditions
with the overall objective of ensuring maximum stakeholder benefit from the retention of high performing Directors and
executive team. The composition of the Remuneration and Nomination Committee is set out on this page of this financial
report.
Use of remuneration advisors
The Remuneration and Nomination Committee did not engage any remuneration advisors during the current year.
Westgold Resources Limited Annual Report 2023
33
4. NON-EXECUTIVE DIRECTOR REMUNERATION
NED Remuneration Policy
The NED fee policy is designed to attract and retain high calibre directors who can discharge the roles and responsibilities
required in terms of good governance, strong oversight, independence and objectivity.
The Company’s constitution and the ASX listing rules specify that the NED fee pool limit, shall be approved periodically
by shareholders. The last determination was at the Annual General Meeting of shareholders on 26 November 2021 with
an aggregate fee pool of $750,000 per year. The amount of the aggregate remuneration sought to be approved by
shareholders and the manner in which it is paid to NEDs is reviewed annually against comparable companies. The Board
also considers benchmarking data when undertaking the review.
Non-executive directors are encouraged to hold shares in the Company and align their interests with the Company’s
shareholders. The shares are purchased by the directors at the prevailing market share price.
NED Remuneration Structure
The remuneration of NEDs consists of director’s fees. There is no scheme to provide retirement benefits to NEDs other
than statutory superannuation. NEDs do not participate in any performance-related incentive programs. Fees paid to
NEDs cover all activities associated with their role on the Board and any sub-committees. NEDs are entitled to fees or other
amounts as the Board determines where they perform special duties or otherwise perform extra services on behalf of the
Company. They may also be reimbursed for out-of- pocket expenses incurred as a result of their directorships.
Position
Non-Executive Chair
Non-Executive Director
Annual Fees $
175,000
95,000
5. EXECUTIVE REMUNERATION
Executive Remuneration Policy
In determining executive remuneration, the Board aims to ensure that remuneration practices are:
–
–
–
–
competitive and reasonable, enabling the Company to attract and retain high calibre talent;
aligned to the Company’s strategic and business objectives and the creation of shareholder value;
transparent and easily understood; and
acceptable to shareholders.
The Company’s approach to remuneration ensures that remuneration is competitive, performance-focused, clearly links
appropriate reward with desired business performance and is simple to administer and understand by executives and
shareholders.
In line with the remuneration policy, remuneration levels are reviewed annually to ensure alignment to the market and
the Company’s stated objectives to provide a base level of remuneration which is both appropriate to the position and is
competitive in the market.
Executive Remuneration Structure
The Company’s remuneration structure provides for a combination of fixed and variable pay with the following components:
–
–
–
fixed remuneration;
short-term incentives (STI); and
long-term incentives (LTI).
34
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) In accordance with the Company’s objective to ensure that executive remuneration is aligned to Company performance,
a portion of executives’ remuneration is placed “at risk”. The relative proportion of FY2023 potential total remuneration
packages split between the fixed and variable remuneration is shown below:
Executive
Managing Director
Other Executives
Elements of remuneration
Fixed
remuneration
61%
77%
STI
20%
19%
LTI
19%
4%
Fixed remuneration
Fixed remuneration consists of base salary, superannuation and other non-monetary benefits and is designed to reward for:
–
–
–
the scope of the executive’s role;
the executive’s skills, experience and qualifications; and
individual performance.
Short Term Incentive (STI) arrangements
Under the STI, all executives have the opportunity to earn an annual incentive award which is delivered in cash. The STI
recognises and rewards annual performance.
How is it paid?
Any STI award is paid in cash after the assessment of annual performance.
How much can executives earn?
In FY2023, the STI dollar values that executives are entitled to receive as a percentage
of their fixed remuneration would not exceed 50% for the Managing Director and 40%
for the other executives.
How is performance measured? A combination of specific Company Key Performance Indicators (KPIs) is chosen
to reflect the core drivers of short-term performance and provide a framework for
delivering sustainable value to the Group and its shareholders.
These measures have been selected as they can be reliably measured, are key drivers
of value for shareholders and encourage behaviours in line with the Company’s core
values.
What KPIs were chosen?
The following KPIs were chosen for the 2023 financial year:
When is it paid?
What happens if an
executive leaves?
–
–
–
–
KPI 1: Safety & Environmental Performance Targets (30%)
KPI 2: All-in Sustaining Cost (AISC) relative to budget (30%)
KPI 3: Gold production relative to budget (30%)
KPI 4: Personal KPI (10%)
The STI award is determined after the end of the financial year following a review of
performance over the year against the STI performance measures by the Remuneration
and Nomination Committee. The Board approves the final STI award based on this
assessment of performance and the award is paid in cash up to three months after the
end of the performance period.
Where executives cease to be an employee of the Group:
–
due to resignation or termination for cause, before the end of the financial year, no
STI is awarded for that year; or
– due to redundancy, ill health, death or other circumstances approved by the Board,
the executive will be entitled to a pro-rata cash payment based on assessment of
performance up to the date of ceasing employment for that year;
unless the Board determines otherwise.
–
What happens if there
is a change of control?
In the event of a change of control, a pro-rata cash payment will be made based on
assessment of performance up to the date of the change of control (subject to Board
discretion).
Westgold Resources Limited Annual Report 2023
35
During the financial year a combination of financial and non-financial measures were used to measure performance for STI
rewards, with a score being calculated on the following measures:
Metric
Weighting
Targets
Score
Safety - Medically Treated Injury
Frequency Rate (MTIFR)
10
Annual MTIFR stays within ±25%
Annual MTIFR decreases by 25% or more
Safety - Lost Time Injury
Frequency Rate (LTIFR)
Annual MTIFR increases by 25% or more
Annual LTIFR decreases by 25% or more
10
Annual LTIFR stays within
±25%
Annual LTIFR increases by 25% or more
Environmental
10
No serious breaches of environmental management
Exceptional environmental management performance
AISC relative to budget
30
Gold Production relative to
budget
30
Serious breach of environmental management
Actual costs below budget by 10% or more
Actual costs below budget by between 5% and 10%
Actual costs below budget by less than 5%
Actual costs above budget by less than 5%
Actual costs above budget by between 5% & 10%
Actual costs above budget by more than 10%
Actual production above budget by 10% or more
Actual production above budget by between 5% and 10%
Actual production above budget by less than 5%
Actual production equals to budget
Actual production below budget by less than 5%
Underperforms budget by between 5% & 10%
Exceptional Effort and Exceptional Achievement
Exceptional Effort and Good Achievement
Personal performance
10
Good Effort and Good Achievement
Good Effort and Average Achievement
Average Effort and Average Achievement
Total
100
10
5
0
10
5
0
10
5
0
30
24
18
12
6
0
30
24
18
12
6
0
10
8
6
4
2
36
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) STI outcomes
Performance against those measure is as follows for FY2023:
Name
Position
WC Bramwell
Managing Director
SH Heng
Chief Financial Officer
PW Wilding
Chief Operating Officer
Total
STI Achieved
%
STI Awarded1
$
Maximum
potential
award
$
71
84
92
209,680
293,626
142,464
170,170
172,030
187,408
524,174
651,204
1.
Performance is measured based on a combination of the operational segment performance as well as overall Group performance. The
FY2023 STI awards were paid in August 2023.
Long Term Incentive (LTI) arrangements
Under the LTI plan, annual grants of performance rights are made to executives to align remuneration with the creation of
shareholder value over the long-term.
How is it paid?
Executives are eligible to receive Performance Rights (Performance Rights).
In FY2023 Performance Rights were issued, being a conditional right issued to receive
a share subject to the terms of the offer.
Are rights eligible for dividends? Executives are not eligible to receive dividends on unvested rights.
How much can executives earn?
The LTI dollar values that executives are entitled to receive as a percentage of their
fixed remuneration would not exceed 80% (FY2022: 80%) for the Managing Director,
80% (FY2022: 60%) for the senior executives and 60% (FY2022: 60%) for the other
executives.
The number of Rights granted were determined using the fair value at the date of grant
using a Monte Carlo valuation model, taking into account the terms and performance
conditions upon which the Rights were granted.
How is performance measured?
Tranche 6 Performance Rights will vest and become exercisable subject to the
following conditions:
A service condition which requires:
–
Continued employment for the three-year period from 1 July 2022 to 30 June 2025.
A performance condition which comprises the following:
–
Growth in Relative Total Shareholder Return
– Growth in Absolute Total Shareholder Return
–
–
Growth in Absolute Earnings Per Share
Ore Reserve Growth
Westgold Resources Limited Annual Report 2023
37
How is performance measured? Relative Total Shareholder Return (RTSR) Performance Condition
The RTSR Performance Rights (30% of total Rights) are measured against a defined
peer group of companies over the testing period, which the Board considers compete
with the Company for the same investment capital, both in Australia and overseas,
and which by the nature of their business are influenced by commodity prices and
other external factors similar to those that impact on the Total Shareholder Return
performance of the Company.
The comparator group of companies for FY23 Rights comprises of:
Gold Road Resources Limited
Musgrave Minerals Limited
Dacian Gold Limited
Newcrest Mining Limited
Ramelius Resources Limited
Regis Resources Limited
Red 5 Limited
St Barbara Limited
Resolute Mining Limited
Silver Lake Resources Limited
The vesting schedule for the RTSR measure is as follows:
RTSR Performance
Below 50th percentile
At 50th percentile
Above 50th percentile and below
75th percentile
75th percentile and above
% Contribution to the Number of
Rights to Vest
0%
50%
Pro-rata from 50% to 100%
100%
Absolute Total Shareholder Return (ATSR) Performance Condition
The ATSR Performance Rights (30% of total Rights) will vest subject to the
performance of the Company’s Total Shareholder Return over the service period. The
ATSR will be measured by comparing the 30 day VWAP at grant date to the 30 day
VWAP at vesting date (30 June 2025).
The vesting schedule for the ATSR measure is as follows:
ATSR Performance
Below 15%
Between 15% and up to 25%
Between 25% and up to 50%
Greater than 50%
% Contribution to the Number of
Rights to Vest
0%
Pro-rata from 50% to 75%
Pro-rata from 75% to 100%
100%
38
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) How is performance measured? Absolute Earnings Per Share (AEPS) Performance Condition
The AEPS Performance Rights (30% of total Rights) will vest subject to the annual
growth rate of the Company’s EPS over the service period. The AEPS will be measured
by comparing the EPS (excluding any non-recurring items) at the grant date to the EPS
(excluding any non-recurring items) at vesting date (30 June 2025).
The vesting schedule for the AEPS measure is as follows:
AEPS Performance
Below 15%
Between 15% and up to 25%
Between 25% and up to 50%
Greater than 50%
% Contribution to the Number of
Rights to Vest
0%
Pro-rata from 50% to 75%
Pro-rata from 75% to 100%
100%
Ore Reserve Growth Performance Conditions
The Ore Reserve Growth Performance Rights (10% of total Rights) will be measured
based on the Reserve Statement as reported at the end of the FY2023 financial year
under JORC guidelines.
Ore Reserve Performance
Negative Growth
Depletion Replaced
% Contribution to the Number of
Rights to Vest
0%
50%
Between depletion replaced and 10% increase
Pro-rata from 50% to 100%
Depletion replaced and 10% increase or
greater
100%
When is performance
measured?
Tranche 6
The measurement date is 31 March 2025.
What happens if an executive
leaves?
Where executives cease to be an employee of the Group:
–
due to resignation or termination for cause, then any unvested Performance Rights
will automatically lapse on the date of the cessation of employment; or
– due to redundancy, ill health, death or other circumstances approved by the
Board, the executive will generally be entitled to a pro-rata number of unvested
Performance Rights based on achievement of the performance measures over the
performance period up to the date of cessation of employment;
– unless the Board determines otherwise.
Westgold Resources Limited Annual Report 2023
39
6. PERFORMANCE AND EXECUTIVE REMUNERATION OUTCOMES
Remuneration earned by executives in 2023
The actual remuneration earned by executives in the year ended 30 June 2023 is set out in the Table on page 42.
This provides shareholders with a view of the remuneration paid to executives for performance in FY2023 year.
Use of board discretion over remuneration outcomes
During the year the Remuneration and Nomination Committee
Considered the appropriateness of awarding STI in relation to performance outcomes and market conditions;
–
– Reviewed the personal KPIs for all senior executives in line with the short term incentive arrangements; and
– Determined the appropriate total remuneration packages for new appointments of senior executives to ensure alignment
to the market and the Company’s stated objectives.
STI performance and outcomes
A combination of financial and non-financial measures was used to measure performance for STI rewards. As a result of the
Group’s performance against those measures STIs rewarded for the FY2023 as disclosed in the Table on page 36, were paid
in August 2023.
LTI performance and outcomes
Performance Rights were granted in FY2022 (Tranche 5) and FY2023 (Tranche 6). All LTI’s are subject to performance
hurdles.
–
–
Tranche 5 has a three-year vesting period ending in June 2024.
Tranche 6 has a three-year vesting period ending in June 2025.
The Managing Director WC Bramwell was granted 385,233 Tranche 6 LTI’s in October 2022.
Senior Executives were granted a total 586,420 Tranche 6 LTI’s in October 2022.
For further details of Performance Rights granted, cancelled, lapsed and vested refer to Table 3 below.
Overview of Company performance
The table below sets out information about Westgold’s earnings and movements in shareholder wealth for the past six years
up to and including the current financial year.
30 June 183
30 June 193
30 June 20
30 June 21
30 June 22
30 June 23
Closing share price
Profit/(loss) per share (cents)
Net tangible assets per share1
Dividend paid per shares (cents)2
$1.85
(0.34)
$1.12
–
$1.88
3.74
$1.14
–
$2.09
8.65
$1.24
–
$1.88
18.16
$1.43
2
$1.19
(25.32)
$1.24
–
$1.44
2.11
$1.26
–
1.
2.
3.
Net tangible assets per share include right of use assets and lease liabilities.
FY21 cash dividend of 2 cents per share declared on 30 August 2021 and paid on 15 October 2021.
The comparatives have not been adjusted for changes due to the adoption of AASB 15, AASB 16 and AASB 9.
Securities Trading Policy
The Westgold Securities Trading Policy applies to all employees and directors. The policy prohibits employees from dealing
in Westgold securities while in possession price sensitive information regarding the Company that is not generally available.
40
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) 7. EXECUTIVE EMPLOYMENT ARRANGEMENTS
A summary of the key terms of employment agreements for executives in place at 30 June 2023 is set out below. There is no
fixed term for executive service agreements and all executives are entitled to participate in the Company’s STI and LTI plans.
The Company may terminate employment agreements immediately for cause, in which the executive is not entitled to any
payment other than the value of fixed remuneration and accrued leave entitlements up to the termination date.
Name
Base Salary $ Superannuation
WC Bramwell (Managing Director)
SH Heng (Chief Financial Officer)
PW Wilding (Chief Operating Officer)
531,450
385,000
424,000
10%
10%
10%
–
PW Wilding was appointed as Chief Operating Officer on 11 October 2022.
Notice
Period
3 months
3 months
3 months
Termination Payment
Per NED
Per NED
Per NED
Westgold Resources Limited Annual Report 2023
41
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42
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED)
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44
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED)
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G
Westgold Resources Limited Annual Report 2023
45
Table 2: Shareholdings of key management personnel (including nominees)
Balance
held at
1 July 2022
On exercise
of rights
Net change
other7
Directors
Hon. CL Edwardes AM
WC Bramwell
FJ Van Maanen
GR Davison
JL Matthys
DN Kelly
PB Schwann1
Executives
SH Heng
PW Wilding
L Smith2
Total
6,122
50,000
435,521
–
112,658
–
–
10,000
27,477
22,810
664,588
–
–
–
–
–
–
–
–
–
–
–
Balance
held at
30 June
2023
6,122
50,000
435,521
–
112,658
–
–
–
–
–
–
–
–
–
10,000
20,000
(3,610)
23,867
–
22,810
6,390
670,978
1.
2.
PB Schwann resigned on 26 July 2022.
L Smith resigned as Company Secretary & General Counsel on 2 November 2022 (balances provided as at her resignation date).
46
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) Table 3: Performance Rights holdings of key management personnel (including nominees)
Performance Rights
Directors
Hon. CL Edwardes
AM
WC Bramwell
FJ Van Maanen
GR Davison
JL Matthys
DN Kelly
PB Schwann1
Executives
SH Heng
PW Wilding
L Smith2
Total
Balance at
beginning of
year
1 July 2022
Granted as
remuneration
Exercised
Lapsed
Balance at
end of year
30 June
2023
Not vested
and not
exercisable
Vested and
exercisable
–
–
202,435
385,233
–
–
–
–
–
–
–
–
–
–
101,123
279,075
193,012
307,345
170,971
159,834
667,541
1,131,487
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
587,668
587,668
–
–
–
–
–
–
–
–
–
–
380,198
380,198
(90,584)
409,773
409,773
(330,805)
–
–
(421,389)
1,377,639
1,377,639
–
–
–
–
–
–
–
–
–
–
–
Loans to key management personnel and their related parties
There were no loans to key management personnel during the years ended 30 June 2023 and 30 June 2022.
Other transactions to key management personnel and their related parties
There are no other transactions with key management personnel during the years ended 30 June 2023 and
30 June 2022.
End of Audited Remuneration Report.
Westgold Resources Limited Annual Report 2023
47
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of the Company
support and have adhered to the principles of Corporate Governance. The Company’s corporate governance key
statements, frameworks, policies and charters are all available on the Company’s website at:
www.westgold.com.au/site/about-us/corporate-governance
ENVIRONMENTAL , SOCIAL AND GOVERNANCE (ESG) REPORTING
The Company intends to release a Sustainability Report in October 2023 outlining the impacts, footprint and achievements
of the Group during 2023.
AUDITOR’S INDEPENDENCE AND NON-AUDIT SERVICES
Auditor’s Independence Declaration
The Directors received the Auditor’s Independence Declaration, as set out on page 49, from Ernst & Young.
NON-AUDIT SERVICES
The following non-audit services were provided by the entity’s auditor, Ernst & Young. The Directors are satisfied that
the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The nature and scope of each type of non-audit service provided means that auditor independence
was not compromised.
Ernst & Young received or are due to receive the following amounts for the provision of non-audit services (refer to Note 31):
Tax compliance and other services
$
76,174
Signed in accordance with a resolution of the Directors.
Hon. Cheryl L Edwardes AM
Independent Non-Executive Chair
Perth, 23 August 2023
48
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ REPORT AUDITOR’S INDEPENDENCE DECLARATION
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s independence declaration to the directors of Westgold Resources
Limited
As lead auditor for the audit of the financial report of Westgold Resources Limited for the financial
year ended 30 June 2023, I declare to the best of my knowledge and belief, there have been:
a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of Westgold Resources Limited and the entities it controlled during the
financial year.
Ernst & Young
T S Hammond
Partner
23 August 2023
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Westgold Resources Limited Annual Report 2023
49
FINANCIAL REPORT AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
Continuing operations
Revenue
Cost of sales
Gross profit
Other income
Finance costs
Other expenses
Impairment of mine properties and property plant and equipment
Net (loss)/ gain on fair value changes of financial assets
Exploration and evaluation expenditure written off
Profit/(loss) before income tax from continuing operations
Income tax benefit/(expense)
Net Profit/(Loss) for the year
Other comprehensive profit for the year, net of tax
Total comprehensive profit/(loss) for the year
Total comprehensive profit/(loss) attributable to:
members of the parent entity
Notes
2023
2022
5
7(a)
6
7(b)
7(c)
17
15
18
8
654,371,234
647,576,618
(631,598,901)
(620,300,818)
22,772,333
27,275,800
10,999,888
4,663,417
(2,457,285)
(1,398,660)
(17,369,902)
(12,967,460)
–
(175,535,410)
4,435
(2,014,040)
–
(110,165)
13,949,469
(160,086,518)
(3,945,985)
48,967,227
10,003,484
(111,119,291)
–
–
10,003,484
(111,119,291)
10,003,484
(111,119,291)
10,003,484
(111,119,291)
Earnings per share attributable to the ordinary equity holders of the
parent (cents per share)
Basic profit/(loss) per share
Continuing operations
Diluted profit/(loss) per share
Continuing operations
9
9
2.11
2.11
(25.32)
(25.32)
50
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT FINANCIAL REPORT
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Prepayments
Other financial assets
Total current assets
NON-CURRENT ASSETS
Financial assets at fair value through profit and loss
Property, plant and equipment
Mine properties and development
Exploration and evaluation expenditure
Right-of-use assets
Total non-current assets
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Provisions
Interest-bearing loans and borrowings
Total current liabilities
NON-CURRENT LIABILITIES
Provisions
Interest-bearing loans and borrowings
Deferred tax liabilities
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Accumulated losses
Share-based payments reserve
Other reserves
TOTAL EQUITY
Notes
2023
2022
10
11
12
13
14
15
16
17
18
19
20
21
23
22
24
8
25
26
27
27
176,411,855
182,701,502
6,854,911
7,122,734
82,739,473
96,082,089
6,449,836
4,149,443
5,427,078
1,930,033
276,605,518
293,263,436
8,157,712
6,799,309
140,903,171
147,916,103
258,787,650
263,803,557
123,487,370
104,577,467
5,310,415
10,814,702
536,646,318
533,911,138
813,251,836
827,174,574
79,227,398
88,017,524
11,809,258
13,066,226
15,942,787
22,842,019
106,979,443
123,925,769
66,274,692
69,669,839
11,548,031
20,117,792
30,110,372
25,693,717
107,933,095
115,481,348
214,912,538
239,407,117
598,339,298
587,767,457
462,997,480
463,468,148
(63,075,769)
(73,079,253)
16,923,956
15,884,931
181,493,631
181,493,631
598,339,298
587,767,457
Westgold Resources Limited Annual Report 2023
51
as at 30 June 2023FINANCIAL REPORT CONSOLIDATED STATEMENT OF FINANCIAL POSITION FINANCIAL REPORT
CONSOLIDATED STATEMENT OF CASH FLOWS
OPERATING ACTIVITIES
Receipts from customers
Interest received
Receipts from other income
Payments to suppliers and employees
Interest paid
Notes
2023
2022
654,368,748
647,576,036
3,457,455
220,263
3,295,285
3,080,832
(491,001,745)
(469,372,796)
(1,686,525)
(1,648,881)
Net cash flows from operating activities
10
168,433,218
179,855,454
INVESTING ACTIVITIES
Payments for property, plant and equipment
Payments for mine properties and development
Payments for exploration and evaluation
Payment for financial assets
Proceeds from sale of financial assets
Payments for performance bond facility
Proceeds from sale of property, plant and equipment
Net cash flows used in investing activities
FINANCING ACTIVITIES
Payment of equipment loans
Payment for lease liabilities
Proceeds from share issue
Payments for share issue costs
Payments for dividends
Net cash flows from (used in) financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
(45,273,252)
(37,738,519)
(95,357,436)
(150,540,448)
(18,909,901)
(18,190,290)
(1,955,248)
(2,390,258)
15
476,062
–
(2,219,410)
(780,584)
5,165,090
8,630,810
(158,074,095)
(201,009,289)
4(f)
(10,155,112)
(28,133,801)
(6,493,658)
(9,037,306)
26(b)
–
–
–
100,800,000
(4,132,800)
(6,324,785)
(16,648,770)
53,171,308
(6,289,647)
32,017,473
182,701,502
150,684,029
Cash and cash equivalents at the end of the year
10
176,411,855
182,701,502
52
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT CONSOLIDATED STATEMENT OF CASH FLOWS CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Retained
Earnings
(accumulated
losses)
(Note 26)
Share-based
payments
reserve
(Note 27)
Issued
capital
(Note 25)
Equity
reserve
(Note 27)
Total Equity
463,468,148 (73,079,253)
15,884,931
181,493,631 587,767,457
– 10,003,484
–
–
–
–
–
– 10,003,484
–
–
– 10,003,484
2023
At 1 July 2022
Profit for the year
Other comprehensive income, net of tax
Total comprehensive loss for the year net of tax
– 10,003,484
Transactions with owners in their capacity as
owners
Share-based payments
Issue of share capital
Share issue costs, net of tax
Dividends paid
At 30 June 2023
2022
At 1 July 2021
Loss for the year
Other comprehensive income, net of tax
Total comprehensive loss for the year net of tax
Transactions with owners in their capacity as
owners
Share-based payments
Issue of share capital
Share issue costs, net of tax
Dividends paid
At 30 June 2022
–
–
(470,668)
–
–
–
–
–
1,039,025
–
–
–
–
–
–
–
1,039,025
–
(470,668)
–
462,997,480 (63,075,769)
16,923,956 181,493,631 598,339,298
364,077,523
46,522,657
15,266,496
181,493,631 607,360,307
–
–
–
–
102,957,835
(3,567,210)
(111,119,291)
–
(111,119,291)
–
–
–
–
–
–
618,435
–
–
–
–
(8,482,619)
–
–
–
–
–
–
–
(111,119,291)
–
(111,119,291)
618,435
102,957,835
(3,567,210)
(8,482,619)
463,468,148 (73,079,253)
15,884,931
181,493,631 587,767,457
Westgold Resources Limited Annual Report 2023
53
for the year ended 30 June 2023FINANCIAL REPORT CONSOLIDATED STATEMENT OF CHANGES IN EQUITY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. CORPORATE INFORMATION
The financial report of Westgold Resources Limited for
the year ended 30 June 2023 was authorised for issue
in accordance with a resolution of the Directors on
23 August 2023.
Westgold Resources Limited (the Company or the Parent)
is a for profit company limited by shares incorporated in
Australia whose shares are publicly traded on the Australian
Securities Exchange.
The nature of the operations and principal activities of the
Group are described in the Directors Report.
The address of the registered office is Level 6,
200 St Georges Terrace, Perth WA 6000.
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(a) Basis of Preparation
The financial report is a general-purpose financial
report, which has been prepared in accordance with
the requirements of the Corporations Act 2001 and
Australian Accounting Standards and other authoritative
pronouncements of the Australian Accounting
Standards Board.
The financial report has been prepared on a historical cost
basis, except for certain financial assets, which have been
measured at fair value through profit or loss.
The financial report is presented in Australian dollars.
(b) Statement of compliance
The financial report complies with Australian Accounting
Standards as issued by the Australian Accounting
Standards Board and also International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board.
Adoption of new accounting standards
In the current year, the Group has adopted all of the new
and revised Standards and Interpretations issued by the
Australian Accounting Standards Board (the AASB) that are
relevant to its operations and effective for annual reporting
periods beginning on 1 July 2022. Other than the changes
described in Note 37, the accounting policies adopted are
consistent with those of the previous financial year.
(c) Basis of consolidation
The consolidated financial statements comprise the
financial statements of the parent entity and its subsidiaries
(the Group) as at 30 June each year. Control is achieved
when the Group is exposed, or has rights, to variable returns
from its involvement with the investee and has the ability
to affect those returns through its power over the investee.
Specifically, the Group controls an investee if and only if the
Group has:
– Power over the investee (existing rights that give it the
current ability to direct the relevant activities of the
investee);
– Exposure, or rights, to variable returns from its
–
involvement with the investee; and
The ability to use its power over the investee to affect its
returns.
When the Group has less than a majority of the voting
or similar rights of an investee, the Group considers all
relevant facts and circumstances in assessing whether it
has power over an investee, including:
–
The contractual arrangement with the other vote
holders of the investee;
– Rights arising from other contractual arrangements; and
The Group’s voting rights and potential voting rights.
–
The Group re-assesses whether it controls an investee if
facts and circumstances indicate that there are changes to
one or more of the three elements of control. Consolidation
of a subsidiary begins when the Group obtains control over
the subsidiary and ceases when the Group loses control
of the subsidiary. Assets, liabilities, income and expenses
of a subsidiary acquired or disposed of during the year are
included in the Consolidated Statement of Comprehensive
Income from the date the Group gains control until the date
the Group ceases to control the subsidiary.
When necessary, adjustments are made to the financial
statements of subsidiaries to bring their accounting
policies into line with the Group’s accounting policies.
All intercompany transactions between members of the
Group are eliminated in full on consolidation.
(d) Foreign currency translation
Functional and presentation currency
The Group’s consolidated financial statements are
presented in Australian (A$), which is also the parent
entity’s functional currency. The Group does not have any
foreign operations.
Transactions and balances
Transactions in foreign currencies are initially recorded in
the functional currency by applying the exchange rates
ruling at the date of the transaction. Monetary assets and
liabilities denominated in foreign currencies are translated
at the rate of exchange at the reporting date.
All exchange differences are taken to the profit or loss.
54
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(e) Operating segments
An operating segment is a component of an entity that
engages in business activities from which it may earn
revenues and incur expenses (including revenues and
expenses relating to transactions with other components
of the same entity), whose operating results are regularly
reviewed by management to make decisions about
resources to be allocated to the segment and assess its
performance and for which discrete financial information is
available. This includes start-up operations which are yet to
earn revenues. Management will also consider other factors
in determining operating segments such as the existence
of a line manager and the level of segment information
presented to the board of directors.
Operating segments have been identified based on the
information provided by management to the Board of
Directors. The Group aggregates two or more operating
segments when they have similar economic characteristics.
Operating segments that meet the quantitative criteria as
prescribed by AASB 8 are reported separately. However,
an operating segment that does not meet the quantitative
criteria is still reported separately where information
about the segment would be useful to users of the
financial statements.
Information about other business activities and operating
segments that are below the quantitative criteria are
combined and disclosed in a separate category for
“all other segments”.
(f) Cash and cash equivalents
Cash and cash equivalents in the consolidated statement
of financial position comprise cash at bank and in hand and
short-term deposits that are readily convertible to known
amounts of cash and which are subject to an insignificant
risk of changes in value.
(g) Financial Instruments
Financial instruments - initial recognition and
subsequent measurement
A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity. Certain commodity
contracts are accounted for as executory contracts and not
recognised as financial instruments as these contracts were
entered into and continue to be held for the purpose of
the delivery of gold bullion in accordance with the Group’s
expected sale requirements (see Note 5).
Financial assets
Initial recognition and measurement
Financial assets are classified at initial recognition, and
subsequently measured at amortised cost, or fair value
through profit or loss or fair value through OCI.
The classification of financial assets at initial recognition
that are debt instruments depends on the financial asset’s
contractual cash flow characteristics and the Group’s
business model for managing them. With the exception of
trade receivables, the Group initially measures a financial
asset at its fair value plus, in the case of a financial asset
not at fair value through profit or loss, transaction costs. In
order for a financial asset to be classified and measured at
amortised cost, it needs to give rise to cash flows that are
‘solely payments of principal and interest (SPPI)’ on the
principal amount outstanding. This assessment is referred
to as the SPPI test and is performed at an instrument level.
Trade receivables that do not contain a significant
financing component or for which the Group has applied
the practical expedient for contracts that have a maturity
of one year or less, are measured at the transaction price
determined under AASB 15.
The Group’s business model for managing financial assets
refers to how it manages its financial assets in order to
generate cash flows. The business model determines
whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both.
Subsequent measurement
For purposes of subsequent measurement, the Group’s
financial assets are classified in these categories:
– Financial assets at amortised cost (debt instruments)
– Financial assets at fair value through profit or loss
Financial assets at amortised cost (debt
instruments)
The Group’s financial assets at amortised cost include
cash, short-term deposits, and trade and other receivables.
The Group measures financial assets at amortised cost if
both of the following conditions are met:
–
–
The financial asset is held within a business model with
the objective to hold financial assets in order to collect
contractual cash flows, and
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.
Financial assets at amortised cost are subsequently
measured using the effective interest rate (EIR) method
and are subject to impairment. Interest received is
recognised as part of other income in the Consolidated
Statement of Comprehensive Income. Gains and losses are
recognised in profit or loss when the asset is derecognised,
modified or impaired.
Westgold Resources Limited Annual Report 2023
55
FINANCIAL REPORT
for the year ended 30 June 2023
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(g) Financial Instruments (continued)
Financial assets at fair value through profit or loss
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, i.e., where they fail the SPPI test. Financial
assets are classified as held for trading if they are acquired
for the purpose of selling or repurchasing in the near term.
Derivatives, including separated embedded derivatives, are
also classified as held for trading unless they are designated
as effective hedging instruments. Financial assets with
cash flows that do not pass the SPPI test are required to be
classified, and measured at fair value through profit or loss,
irrespective of the business model.
Notwithstanding the criteria for debt instruments to be
classified at amortised cost or at fair value through OCI,
as described above, debt instruments may be designated
at fair value through profit or loss on initial recognition
if doing so eliminates, or significantly reduces, an
accounting mismatch.
Financial assets at fair value through profit or loss are
carried in the statement of financial position at fair value
with net changes in fair value recognised in profit or loss.
Impairment of financial assets
The Group recognises an allowance for ECLs for all debt
instruments not held at fair value through profit or loss.
ECLs are based on the difference between the contractual
cash flows due in accordance with the contract and all the
cash flows that the Group expects to receive, discounted
at an approximation of the original EIR. The expected cash
flows will include cash flows from the sale of collateral
held or other credit enhancements that are integral to
the contractual terms. ECLs are recognised in two stages.
For credit exposures for which there has not been a
significant increase in credit risk since initial recognition,
ECLs are provided for credit losses that result from
default events that are possible within the next 12-months
(a 12-month ECL).
For those credit exposures for which there has been a
significant increase in credit risk since initial recognition,
a loss allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the timing
of the default (a lifetime ECL).
For trade receivables, the Group applies the simplified
approach in calculating ECLs, as permitted by AASB 9.
Therefore, the Group does not track changes in credit
risk, but instead, recognises a loss allowance based
on the financial asset’s lifetime ECL at each reporting
date (see Note 3). For any other financial assets carried at
amortised cost (which are due in more than 12 months),
the ECL is based on the 12-month ECL.
56
Westgold Resources Limited Annual Report 2023
The 12-month ECL is the proportion of lifetime ECLs that
results from default events on a financial instrument that
are possible within 12 months after the reporting date.
However, when there has been a significant increase in
credit risk since origination, the allowance will be based on
the lifetime ECL. When determining whether the credit
risk of a financial asset has increased significantly since
initial recognition and when estimating ECLs, the Group
considers reasonable and supportable information that is
relevant and available without undue cost or effort.
This includes both quantitative and qualitative information
and analysis, based on the Group’s historical experience
and informed credit assessment including forward-looking
information.
The Group considers a financial asset in default when
contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a financial
asset to be in default when internal or external information
indicates that the Group is unlikely to receive the
outstanding contractual amounts in full before taking
into account any credit enhancements held by the Group.
A financial asset is written off when there is no reasonable
expectation of recovering the contractual cash flows and
usually occurs when past due for more than one year and
not subject to enforcement activity.
At each reporting date, the Group assesses whether
financial assets carried at amortised cost are credit-
impaired. A financial asset is credit-impaired when one
or more events that have a detrimental impact on the
estimated future cash flows of the financial asset have
occurred.
Financial Liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss, loans
and borrowings, and payables as appropriate.
All financial liabilities are recognised initially at fair value
and, in the case of loans and borrowings and payables, net
of directly attributable transaction costs.
The Group’s financial liabilities include trade and other
payables, loans and borrowings.
Subsequent measurement
Financial liabilities at fair value through profit or
loss
Financial liabilities at fair value through profit or loss include
financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through
profit or loss.
Financial liabilities are classified as held for trading if they
are incurred for the purpose of repurchasing in the near
term. This category also includes derivative financial
instruments entered into by the Group that are not
designated as hedging instruments in hedge relationships.
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(g) Financial Instruments (continued)
Gains or losses on liabilities held for trading are recognised
in the statement of profit or loss and other comprehensive
income.
Expected decommissioning and rehabilitation costs are
based on the discounted value of the estimated future cost
of detailed plans prepared for each site. Where there is a
change in the expected decommissioning and restoration
costs, the value of the provision and any related asset are
adjusted, and the effect is recognised in profit or loss on a
prospective basis over the remaining life of the operation.
Loans, borrowings, and trade and other payables
After initial recognition, interest-bearing loans and
borrowings and trade and other payables are subsequently
measured at amortised cost using the EIR method. Gains
and losses are recognised in the statement of comprehensive
income when the liabilities are derecognised, as well as
through the EIR amortisation process.
Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs
that are an integral part of the EIR. The EIR amortisation
is included as finance costs in the statement of
comprehensive income.
This category generally applies to interest-bearing loans
and borrowings and trade and other payables.
(h) Inventories
Inventories are valued at the lower of cost and net realisable
value.
Cost includes expenditure incurred in acquiring and
bringing the inventories to their existing condition and
location and is determined using the weighted average cost
method.
(i) Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset (i.e. an
asset that necessarily takes a substantial period of time
to get ready for its intended use or sale) are capitalised
as part of the cost of that asset. All other borrowing costs
are expensed in the period they occur. Borrowing costs
consist of interest and other costs that an entity incurs in
connection with the borrowing of funds.
( j) Rehabilitation costs
The Group is required to decommission and rehabilitate
mines and processing sites at the end of their producing
lives to a condition acceptable to the relevant authorities.
The expected cost of any approved decommissioning or
rehabilitation programme, discounted to its net present
value, is provided when the related environmental
disturbance occurs. The cost is capitalised when it gives
rise to future benefits, whether the rehabilitation activity
is expected to occur over the life of the operation or at the
time of closure. The capitalised cost is amortised over the
life of the operation and the increase in the net present
value of the provision for the expected cost is included in
financing expenses.
The estimated costs of rehabilitation are reviewed annually
and adjusted as appropriate for changes in legislation,
technology or other circumstances. Cost estimates are not
reduced by potential proceeds from the sale of assets or
from plant clean up at closure.
(k) Property, plant and equipment
Property, plant and equipment is stated at historical cost
less accumulated depreciation and any impairment in value.
Capital work-in-progress is stated at cost and comprises
all costs directly attributable to bringing the assets
under construction ready to their intended use. Capital
work-in-progress is transferred to property, plant and
equipment at cost on completion.
Depreciation is calculated on a straight-line basis over the
estimated useful life of the asset, or where appropriate, over
the estimated life of the mine.
Major depreciation periods are:
– Mine specific plant and equipment is depreciated using
– the shorter of life of mine and useful life. Useful life
ranges from 2 to 25 years.
– Buildings – the shorter of life of mine and useful life.
Useful life ranges from 5 to 40 years.
– Office plant and equipment is depreciated at 33% per
annum for computers and office machines and 20% per
annum for other office equipment and furniture.
Impairment
The carrying values of property, plant and equipment
are reviewed for impairment when events or changes in
circumstances indicate the carrying value may not be
recoverable.
For an asset that does not generate largely independent
cash inflows, the recoverable amount is determined for the
cash-generating unit to which the asset belongs.
If any such indication exists and where the carrying values
exceed the estimated recoverable amount, the assets or
cash-generating units are written down to their recoverable
amount. Refer to Note 2(o) for further discussion on
impairment testing performed by the Group.
Derecognition
An item of property, plant and equipment is derecognised
upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset.
Westgold Resources Limited Annual Report 2023
57
FINANCIAL REPORT
for the year ended 30 June 2023
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(k) Property, plant and equipment (continued)
Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal
proceeds and the carrying amount of the item) is included
in the profit and loss in the period the item is derecognised.
Recoverable amount 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. When the carrying amount of an asset or CGU
exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount.
Refer to Note 2(o) for further discussion on impairment
testing performed by the Group.
(l) Exploration and evaluation expenditure
Expenditure on acquisition, exploration and evaluation
relating to an area of interest is carried forward at cost where
rights to tenure of the area of interest are current and:
–
–
it is expected that expenditure will be recouped through
successful development and exploitation of the area of
interest or alternatively by its sale; and/or
exploration and evaluation activities are continuing in
an area of interest but at reporting date have not yet
reached a stage which permits a reasonable assessment
of the existence or otherwise of economically
recoverable reserves.
A regular review is undertaken of each area of interest
to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest. Where
uncertainty exists as to the future viability of certain areas,
the value of the area of interest is written off to the profit
and loss or provided against.
Impairment
The carrying value of capitalised exploration and evaluation
expenditure is assessed for impairment on a regular basis
or whenever impairment indicators are present. When
information becomes available suggesting that the recovery
of expenditure which had previously been capitalised
is unlikely or that the Group no longer holds tenure, the
relevant capitalised amount is written off to the profit or loss
in the period when the new information becomes available.
(m) Mine properties and development
Expenditure on the acquisition and development of mine
properties within an area of interest are carried forward
at cost separately for each area of interest. This includes
the costs associated with waste removal (stripping costs)
in the creation of improved access and mining flexibility in
relation to the ore to be mined in the future. Accumulated
expenditure is amortised over the life of the area of interest
to which such costs relate on a production output basis.
A regular review is undertaken of each area of interest
to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Impairment
The carrying value of capitalised mine properties and
development expenditure is assessed for impairment
whenever facts and circumstances suggest that the carrying
amount of the asset may exceed its recoverable amount.
Stripping (waste removal) costs
As part of its mining operations, the Group incurs stripping
(waste removal) costs both during the development phase
and production phase of its operations. Stripping costs
incurred in the development phase of a mine, before the
production phase commences (development stripping),
are capitalised as part of the cost of constructing the
mine and subsequently amortised over its useful life using
a unit of production (UOP) method. The capitalisation
of development stripping costs ceases when the mine/
component is commissioned and ready for use as intended
by management.
Stripping activities undertaken during the production
phase of a surface mine (production stripping) are
accounted for as set out below. After the commencement
of production, further development of the mine may
require a phase of unusually high stripping that is similar in
nature to development phase stripping. The cost of such
stripping is accounted for in the same way as development
stripping (as outlined above).
Production stripping is generally considered to create
two benefits, being either the production of inventory
or improved access to the ore to be mined in the future.
Where the benefits are realised in the form of inventory
produced in the period, the production stripping costs
are accounted for as part of the cost of producing those
inventories.
Where the benefits are realised in the form of improved
access to ore to be mined in the future, the costs are
recognised as a non-current asset, referred to as a ‘stripping
activity asset’, if the following criteria are met:
– Future economic benefits (being improved access to the
–
–
ore body) are probable
The component of the ore body for which access will be
improved can be accurately identified
The costs associated with the improved access can be
reliably measured
If any of the criteria are not met, the production stripping
costs are charged to profit or loss as operating costs as they
are incurred.
In identifying components of the ore body, the Group
works closely with the mining operations personnel for
each mining operation to analyse each of the mine plans.
Generally, a component will be a subset of the total ore
body, and a mine may have several components. The mine
plans, and therefore the identification of components, can
vary between mines for a number of reasons.
58
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(m) Mine properties and development
(continued)
These include, but are not limited to the type of commodity,
the geological characteristics of the ore body, the
geographical location, and/or financial considerations.
Given the nature of the Group’s operations, components
are generally either major pushbacks or phases and they
generally form part of a larger investment decision which
requires board approval.
The stripping activity asset is initially measured at cost,
which is the accumulation of costs directly incurred to
perform the stripping activity that improves access to the
identified component of ore, plus an allocation of directly
attributable overhead costs.
If incidental operations are occurring at the same time as
the production stripping activity, but are not necessary for
the production stripping activity to continue as planned,
these costs are not included in the cost of the stripping
activity asset.
If the costs of the inventory produced and the stripping
activity asset are not separately identifiable, a relevant
production measure is used to allocate the production
stripping costs between the inventory produced and
the stripping activity asset. This production measure is
calculated for the identified component of the ore body
and is used as a benchmark to identify the extent to which
the additional activity of creating a future benefit has taken
place. The Group uses the expected volume of waste
extracted compared with the actual volume for a given
volume of ore production of each component.
The stripping activity asset is accounted for as an addition
to, or an enhancement of, an existing asset, being the
mine asset, and is presented as part of ’Mine properties’ in
the statement of financial position. This forms part of the
total investment in the relevant cash generating unit(s),
which is reviewed for impairment if events or changes of
circumstances indicate that the carrying value may not be
recoverable.
The stripping activity asset is subsequently depreciated
using the UOP method over the life of the identified
component of the ore body that became more accessible
as a result of the stripping activity. Economically
recoverable reserves, which comprise proven and probable
reserves, are used to determine the expected useful life of
the identified component of the ore body. The stripping
activity asset is then carried at cost less depreciation and
any impairment losses.
(n) Non-current assets and disposal groups
held for sale and discontinued operations
Non-current assets and disposal groups are classified as
held for sale and measured at the lower of their carrying
amount and fair value less costs of disposal if their carrying
amount will be recovered principally through a sale
transaction. They are not depreciated or amortised. For an
asset or disposal group to be classified as held for sale it
must be available for immediate sale in its present condition
and its sale must be highly probable.
An impairment loss is recognised for any initial or
subsequent write-down of the asset (or disposal group)
to fair value less costs to sell. A gain is recognised for
any subsequent increases in fair value less costs to sell
of an asset (or disposal group), but is not in excess of any
cumulative impairment loss previously recognised.
A gain or loss not previously recognised by the date of
the sale of the non-current asset (or disposal group) is
recognised as the date of de-recognition.
A discontinued operation is a component of the Group
that has been disposed of or is classified as held for sale
and that represents a separate major line of business
or geographical area of operations, is part of a single
coordinated plan to dispose of such a line of business or
area of operations, or is a subsidiary acquired exclusively
with a view to resale. The results of discontinued operations
are presented separately on the face of the Consolidated
Statement of Comprehensive Income and the assets
and liabilities are presented separately on the face of the
Consolidated Statement of Financial Position.
(o) Impairment of non-financial assets
The Group assesses, at each reporting date, whether there is
an indication that an asset may be impaired. If any indication
exists, or when annual impairment testing for an asset is
required, the Group estimates the asset’s recoverable
amount. An asset’s recoverable amount is the higher of an
asset’s or cash-generating unit’s (CGU) fair value less costs
of disposal (FVLCD) and its value in use (VIU).
Recoverable amount 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. When the carrying amount of an asset or CGU
exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount.
In assessing VIU, 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 or CGU.
In determining FVLCD, recent market transactions are taken
into account. If no such transactions can be identified, an
appropriate valuation model is used.
Westgold Resources Limited Annual Report 2023
59
FINANCIAL REPORT
for the year ended 30 June 2023
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(o) Impairment of non-financial assets
(continued)
The Group bases its impairment calculation on detailed
budgets and forecasts, which are prepared separately for
each of the Group’s CGUs to which the individual assets are
allocated, based on the life-of-mine plans. The estimated
cash flows are based on expected future production,
metal selling prices, operating costs and forecast capital
expenditure based on life-of-mine plans.
VIU does not reflect future cash flows associated with
improving or enhancing an asset’s performance, whereas
anticipated enhancements to assets are included in FVLCD
calculations.
Impairment losses of continuing operations, including
impairment on inventories, are recognised in the profit and
loss. For such properties, the impairment is recognised
in other comprehensive income up to the amount of any
previous revaluation.
For assets, an assessment is made at each reporting date
to determine whether there is an indication that previously
recognised impairment losses no longer exist or have
decreased. If such indication exists, the Group estimates
the asset’s or CGU’s recoverable amount. A previously
recognised impairment loss is reversed only if there has
been a change in the assumptions used to determine the
asset’s recoverable amount since the last impairment loss
was recognised. The reversal is limited so that the carrying
amount of the asset does not exceed its recoverable
amount, nor 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.
(p) Provisions
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic
benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
Provisions are measured at the present value of management’s
best estimate of the expenditure required to settle the
present obligation at the reporting date. The discount rate
used to determine the present value reflects current market
assessments of the time value of money and the risks specific
to the liability. The increase in the provision resulting from the
passage of time is recognised in finance costs.
(q) Lease liabilities
The Group has lease contracts for various items of mining
equipment, motor vehicles and buildings used in its
operations., All leases with the exception of short term
(under 12 months) and low value leases, are recognised
on the balance sheet as a right-of-use asset and a
corresponding interest-bearing liability. Lease costs are
recognized in the income statement over the lease term
in the form of depreciation on the right-of-use asset and
finance charges representing the unwinding of the discount
on the lease liability. The Group recognises leases using the
incremental borrowing rate.
(r) Interest revenue
Revenue is recognised using the effective interest method.
This is a method of calculating the amortised cost of a
financial asset and allocating the interest income over the
relevant period using the effective interest rate, which is the
rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to the net
carrying amount of the financial asset.
(s) Revenue from contracts with customers
Revenue from contracts with customers is recognised when
control of the goods or services are transferred to the customer
at an amount that reflects the consideration to which the
Group expects to be entitled in exchange for those goods or
services. The Group has concluded that it is the principal in its
revenue contracts because it typically controls the goods or
services before transferring them to the customer.
Gold bullion sales
For bullion sales, most of this is sold under a long-term sales
contract with the refiner and forward sale agreements with
Citibank N.A. The only performance obligation under the
contract is the sale of gold bullion. Revenue from bullion
sales is recognised at a point in time when control passes
to the buyer. This generally occurs after the unrefined doré
is out turned and the Group either instructs the refiner to
purchase the out turned fine metal or advises the refiner to
transfer the gold to the bank by crediting the metal account
of the bank. As all performance obligations are satisfied at
that time, there are no remaining performance obligations
under the contract. The transaction price is determined
at transaction date and there are no further adjustments
to this price.
A contract liability is the obligation to transfer goods or
services to a customer for which the Group has received
consideration from the customer. If a customer pays
consideration before the Group transfers goods or services
to the customer, a contract liability is recognised when
the payment is made, or the payment is due (whichever
is earlier). Contract liabilities are recognised as revenue
when the Group performs under the contract. The Group
applies the practical expedient to not adjust the promised
consideration for the effects of a significant financing
component where the period between the transfer of the
refined gold to a customer and the receipt of the advance
is one year or less. For long-term advances from customers
the transaction price is discounted, using the rate that
would be reflected in a separate transaction between the
Group and its customers at contract inception, to take into
consideration the significant financing component.
60
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(t) Earnings per share
Basic earnings per share is calculated as net profit
attributable to members of the parent, 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.
At each subsequent reporting date until vesting, the
cumulative charge to the consolidated statement of
comprehensive income is the product of (i) the grant date
fair value of the award; (ii) the current best estimate of
the number of awards that will vest, taking into account
such factors as the likelihood of employee turnover during
the vesting period and the likelihood of non-market
performance conditions being met; and (iii) the expired
portion of the vesting period.
Diluted earnings per share is calculated as net profit
attributable to members of the parent adjusted for:
–
–
cost of servicing equity (other than dividends) and
preference share dividends;
the after-tax effect of dividends and interest associated
with dilutive potential ordinary shares that have been
recognised; and
– other non-discriminatory changes in revenues or
expenses during the period that would result from the
dilution of potential ordinary shares divided by the
weighted average number of ordinary shares and dilutive
potential ordinary shares; adjusted for any bonus element.
(u) Issued capital
Issued and paid-up capital is recognised at the fair value of
the consideration received by the Group. Any transaction
costs arising on the issue of ordinary shares are recognised
directly in equity as a reduction in the proceeds received.
(v) Share-based payment transactions
The Group provides benefits to employees (including
Directors) in the form of share-based payment transactions,
whereby employees render services in exchange for shares
or rights over shares (equity-settled transactions). The
Group has one plan in place that provides these benefits.
It is the Long-Term Incentive Plan (LTIP) which provides
benefits to all employees including Directors.
In valuing equity-settled transactions, no account is taken
of any vesting conditions (such as service conditions), other
than conditions linked to the price of the shares of Westgold
Resources Limited (market conditions) if applicable.
The cost of these equity-settled transactions with
employees is measured by reference to the fair value at the
date at which they are granted. The fair value is determined
by using either a Black & Scholes or a Monte Carlo model as
appropriate. Further details of which are given in Note 28.
The cost of equity-settled transactions is recognised,
together with a corresponding increase in equity, over the
period in which the performance and/or service conditions
are fulfilled (the vesting period), ending on the date on
which the relevant employees become fully entitled to the
award (the vesting date).
The charge to profit and loss for the period is the cumulative
amount as calculated above, less the amounts already charged
in previous periods. There is a corresponding credit to equity.
Until an award has vested, any amounts recorded are
contingent and will be adjusted if more or fewer awards vest
than were originally anticipated to do so. Any award subject
to a market condition is considered to vest irrespective of
whether or not the market condition is fulfilled, provided
that all other conditions are satisfied.
If a non-vesting condition is within the control of the Group,
Company or the employee, the failure to satisfy the condition
is treated as a cancellation. If a non-vesting condition within
the control of neither the Group, Company nor employee
is not satisfied during the vesting period, any expense for
the award not previously recognised is recognised over the
remaining vesting period, unless the award is forfeited.
If the terms of an equity-settled award are modified, as a
minimum an expense is recognised as if the terms had not
been modified. An additional expense is recognised for any
modification that increases the total fair value of the share-
based payment arrangement, or is otherwise beneficial to
the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it
had vested on the date of cancellation, and any expense not
yet recognised for the award is recognised immediately.
However, if a new award is substituted for the cancelled
award and designated as a replacement award on the date
that it is granted, the cancelled and new award are treated
as if they were a modification of the original award, as
described in the previous paragraph. The dilutive effect,
if any, of outstanding rights is reflected as additional share
dilution in the computation of dilutive earnings per share.
(w) Employee benefits
Wages, salaries, sick leave and other short-term
benefits
Liabilities for wages and salaries, including non-monetary
benefits, accumulating sick leave and other short-term
benefits expected to be settled wholly within 12 months of
the reporting date are recognised in respect of employees’
services up to the reporting date. They are measured at the
amounts expected to be paid when the liabilities are settled.
Westgold Resources Limited Annual Report 2023
61
FINANCIAL REPORT
for the year ended 30 June 2023
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
(w) Employee benefits (continued)
Long service leave
The liability for long service leave is recognised and
measured as the present value of expected future
payments to be made in respect of services provided by
employees up to the reporting date using the projected
unit credit method. Consideration is given to the
expected future wage and salary levels, experience of
employee departure and periods of service. Expected
future payments are discounted using market yields at
the reporting date on high quality corporate bonds with
terms to maturity and currencies that match, as closely as
possible, the estimated future cash outflows.
Superannuation
Contributions made by the Group to employee
superannuation funds, which are defined contribution
plans, are charged as an expense when incurred.
(x) Other taxes
Revenues, expenses and assets are recognised net of the
amount of GST except:
– when the GST incurred on purchase of goods or services
is not recoverable from the taxation authority, in
which case the GST is recognised as part of the cost of
acquisition of the asset or as part of the expense item as
applicable; and
receivables and payables, which are stated with the
amount of GST included.
–
The net amount of GST recoverable from, or payable to,
the taxation authority is included as part of receivables
or payables in the Consolidated Statement of Financial
Position.
Cash flows are included in the Consolidated Statement
of Cash Flows on a gross basis and the GST component of
cash flows arising from investing and financing activities,
which is recoverable from, or payable to, the taxation
authority is classified as operating cash flows.
Commitments and contingencies are disclosed net of
amounts of GST recoverable from, or payable to, the
taxation authority.
(y) Income tax
Current income tax assets and liabilities for the current and
prior periods are measured at the amount expected to be
recovered from, or paid to, the taxation authorities. The tax
rates and tax laws used to compute the amount are those
that are enacted or substantively enacted at the reporting
date in the countries where the Group operates and
generates taxable income.
Current income tax relating to items recognised directly
in other comprehensive income or equity is recognised in
other comprehensive income or equity and not in profit or
loss. Management periodically evaluates positions taken in
62
Westgold Resources Limited Annual Report 2023
the tax returns with respect to situations where applicable
tax regulations are subject to interpretation and establishes
provisions where appropriate.
Deferred tax is provided for using the full liability balance
sheet approach.
The tax rates and tax laws used to compute the amount
of deferred tax assets and liabilities are those that are
enacted or substantively enacted at the reporting date in
the countries where the Group operates and generates
taxable profits.
Deferred tax liabilities are recognised for all taxable
temporary differences except to the extent that the
deferred tax liability arises from:
–
–
–
the initial recognition of goodwill;
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 tax loss); and
taxable temporary differences associated with
investments in subsidiaries, associates and interests in
joint ventures when the timing of the reversal of the
temporary differences can be controlled by the Group
and it is probable that the temporary differences will not
reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible
temporary differences, including carry-forward tax losses
and tax credits, to the extent that it is probable that taxable
profit will be available against which the deductible
temporary differences can be utilised except when:
–
–
the deferred 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 tax loss); and
the deductible temporary difference is associated with
investments in subsidiaries, associates and interests in
joint ventures and it is not probable that the temporary
difference will reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to be
utilised.
Unrecognised deferred tax assets and deferred tax
liabilities are reassessed at each reporting date and are
recognised to the extent that they satisfy the requirements
for recognition.
Deferred tax assets and deferred tax liabilities are offset
only if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred
tax assets and deferred tax liabilities relate to income
taxes levied by the same taxation authority on the same
taxable entity.
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2.
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
Significant judgements
– Revenue from contracts with customers
(y) Income tax (continued)
Income taxes relating to transactions recognised
outside profit and loss (for example, directly in other
comprehensive income or directly in equity) are also
recognised outside profit and loss.
Tax consolidation
Westgold Resources Limited and its wholly owned
Australian resident subsidiaries formed a tax consolidated
group (the Tax Group) with effect from 1 December 2016.
Members of the Tax Group have entered into a tax sharing
agreement, which provides for the allocation of income
tax liabilities between members of the Tax Group should
the parent, Westgold Resources Limited, default on its tax
payments obligations.
The Group has applied the group allocation approach
in determining the appropriate amount of current taxes
and deferred taxes to allocate to members of the tax
consolidated group. Members of the tax consolidated
group have entered into a tax funding agreement. The tax
funding agreement provides for the allocation of current
taxes to members of the tax consolidated group.
The allocation of taxes under the tax funding agreement
is recognised as an increase/decrease in the controlled
entities intercompany accounts with the tax consolidated
group head company, Westgold Resources Limited. The
nature of the tax funding agreement is such that no tax
consolidation adjustments are required.
3.
SIGNIFICANT ACCOUNTING
JUDGEMENTS, ESTIMATES AND
ASSUMPTIONS
The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts in the
financial statements. Management continually evaluates
its judgements and estimates in relation to assets, liabilities,
contingent liabilities, revenue and expenses. Management
bases its judgements and estimates on historical
experience and on other various factors it believes to be
reasonable under the circumstances, the result of which
form the basis of the carrying values of assets and liabilities
that are not readily apparent from other sources.
Management has identified the following critical
accounting policies for which significant judgements have
been made as well as the following key estimates and
assumptions that have the most significant impact on the
financial statements. Actual results may differ from these
estimates under different assumptions and conditions
and may materially affect financial results or the financial
position reported in future periods.
Further details of the nature of these assumptions and
conditions may be found in the relevant notes to the
financial statements.
Judgement is required to determine the point at which the
customer obtains control of gold. Factors including transfer
of legal title, transfer of significant risks and rewards of
ownership and the existence of a present right to payment
for the gold typically result in control transferring upon
allocation of the gold to the customers’ account.
Significant accounting estimates and
assumptions
Determination of mineral resources and ore
reserves
The determination of reserves impacts the accounting
for asset carrying values, depreciation and amortisation
rates and provisions for mine rehabilitation. The Group
estimates its mineral resource and reserves in accordance
with the Australian code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves 2012
(the JORC code). The information on mineral resources
and ore reserves were prepared by or under the supervision
of Competent Persons as defined in the JORC code.
The amounts presented are based on the mineral resources
and ore reserves determined under the JORC code.
There are numerous uncertainties inherent in estimating
mineral resources and ore reserves and assumptions that
are valid at the time of estimation may change significantly
when new information becomes available.
Changes in the forecast prices of commodities, exchange
rates, production costs or recovery rates may change the
economic status of reserves and may ultimately, result in
the reserves being restated.
Mine rehabilitation provision
The Group assesses its mine rehabilitation provision on an
annual basis in accordance with the accounting policy stated
in Note 2(j). In determining an appropriate level of provision
consideration is given to the expected future costs to be
incurred, the timing of those future costs (largely dependent
on the life of mine) and the estimated level of inflation.
The ultimate rehabilitation costs are uncertain, and cost
estimates can vary in response to many factors, including
estimates of the extent and costs of rehabilitation activities,
technological changes, regulatory changes, timing,
cost increases as compared to the inflation rate of 2.5%
(2022: 2.5%), and changes in discount rates. The applicable
discount rates are based on the expected life of mine for
each operation, ranging between 7 to 10 years.
The expected timing of expenditure can also change, for
example in response to changes in reserves or production
rates. These uncertainties may result in future actual
expenditure differing from the amounts currently provided.
Therefore, significant estimates and assumptions are
made in determining the provision for mine rehabilitation.
As a result, there could be significant adjustments to
the provisions established which would affect future
financial result. The provision at reporting date represents
management’s best estimate of the present value of the
future rehabilitation costs required.
Westgold Resources Limited Annual Report 2023
63
FINANCIAL REPORT
for the year ended 30 June 2023
3.
SIGNIFICANT ACCOUNTING
JUDGEMENTS, ESTIMATES AND
ASSUMPTIONS (CONTINUED)
Significant accounting estimates and
assumptions (continued)
Impairment of capitalised exploration and
evaluation expenditure
The future recoverability of capitalised exploration and
evaluation expenditure is dependent on various factors,
including whether the Group decides to exploit the related
area interest itself or, if not, whether it successfully recovers
the related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include
the level of reserves and resources, future technological
changes, which could impact the cost of mining, future
legal changes (including changes to environmental
restoration obligations) and changes to commodity prices.
To the extent that capitalised exploration and evaluation
expenditure is determined not to be recoverable in the
future, profits and net assets will be reduced in the period in
which this determination is made.
In addition, exploration and evaluation expenditure is
capitalised if activities in the area of interest have not yet
reached a stage that permits a reasonable assessment of
the existence or otherwise of economically recoverable
reserves. To the extent it is determined in the future that
this capitalised expenditure should be written off, profits
and net assets will be reduced in the period in which this
determination is made.
Life of mine method of amortisation and
depreciation
Estimated economically recoverable reserves and
resources are used in determining the depreciation of
mine-specific assets. This results in a depreciation charge
proportional to the depletion of the anticipated remaining
life-of-mine production. The life of each item, which is
assessed at least annually, has regard to both its physical
life limitations and present assessments of economically
recoverable reserves of the mine property at which the
asset is located. Changes in estimates are accounted for
prospectively.
These calculations require the use of estimates and
assumptions, including the amount of recoverable reserves
and estimates of future capital expenditure. The calculation
of the UOP rate of depreciation could be impacted to
the extent that actual production in the future is different
from current forecast production based on economically
recoverable reserves, or if future capital expenditure
estimates change. Changes to economically recoverable
reserves could arise due to changes in the factors or
assumptions used in estimating reserves, including:
–
The effect on economically recoverable reserves for
differences between actual commodity prices and
commodity price assumptions
– Unforeseen operational issues.
64
Westgold Resources Limited Annual Report 2023
Impairment of capitalised mine development
expenditure, property, plant and equipment
The future recoverability of capitalised mine development
expenditure, property, plant and equipment is dependent
on a number of factors, including the level of proved and
probable reserves, and the likelihood of progressive upgrade
of mineral resources in to reserves over time. In addition,
consideration is given to future technological changes,
which could impact the cost, future legal changes (including
changes to environmental restoration obligations), and
changes in commodity prices. Non-financial assets are
reviewed for impairment if there is any indication that the
carrying amount may not be recoverable.
When applicable, FVLCD is estimated based on discounted
cash flows using market based commodity prices and
foreign exchange rate assumptions, estimated quantities
of recoverable minerals, production levels, operating costs
and capital requirements, based on the relevant CGU’s life
ofmine (LOM) plans.
Consideration is also given to analysts’ valuations. The fair
value methodology adopted is categorised as Level 3 in the
fair value hierarchy.
In determining the VIU, future cash flows for each CGU
(i.e. each mine site) are prepared utilising management’s
latest estimates of:
–
–
–
–
–
the quantities of ore reserves and mineral resources for
which there is a high degree of confidence of economic
extraction;
royalties and taxation;
future production levels;
future commodity prices;
future cash costs of production and development
expenditure; and
– other relevant cash inflows and outflows.
Cash flow scenarios for a range of commodity prices
and foreign exchange rates are assessed using internal
and external market forecasts, and the present value of
the forecast cash flows is determined utilising a pre-tax
discount rate.
The Group’s cash flows are most sensitive to movements in
commodity price, expected quantities of ore reserves and
mineral resources and key operating costs. In particular,
CGO, MGO and FGO are most sensitive to expected
quantities of ore reserves and mineral resources to be
extracted and therefore the estimated future cash inflows
resulting from the sale of product produced is dependent
on these assumptions. Variations to the expected cash
flows, and the timing thereof, could result in significant
changes to any impairment losses recognised, if any, which
in turn could impact future financial results.
To the extent that capitalised mine development expenditure
is determined not to be recoverable in the future, this will
reduce profit in the period in which the Group makes this
determination. Capitalised mine development expenditure
is assessed for recoverability in a manner consistent with
property, plant and equipment as described below.
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3.
SIGNIFICANT ACCOUNTING
JUDGEMENTS, ESTIMATES AND
ASSUMPTIONS (CONTINUED)
Significant accounting estimates and
assumptions (continued)
Refer to Note 2(o) for further discussion on the impairment
assessment process undertaken by the Group.
Provision for expected credit losses (ECLs)
on trade receivables and other short-term
receivables carried at amortised cost
The Group uses a provision matrix to calculate ECLs for
trade and other short-term receivables carried at amortised
cost. The provision rates are based on days past due.
The provision matrix is initially based on the Group’s
historical observed default rates. The Group calibrates
the matrix to adjust the historical credit loss experience
with forward-looking information. For instance, if forecast
economic conditions are expected to deteriorate over
the next year, which can lead to an increased number of
defaults, the historical default rates are adjusted. At every
reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates are
analysed.
The assessment of the correlation between historical
observed default rates, forecast economic conditions and
ECLs is a key estimate. The amount of ECLs is sensitive
to changes in circumstances and of forecast economic
conditions. The Group’s historical credit loss experience
and forecast of economic conditions may also not be
representative of customer’s actual default in the future.
Share-based payment transactions
The fair value is determined by using an appropriate
valuation, using the assumptions as discussed in Note 28.
The accounting estimates and assumptions relating to
equity-settled share-based payments would have no
impact on the carrying amounts of assets and liabilities in
the next annual reporting period but may impact expenses
and equity.
Estimating the incremental borrowing rate
Where the Group cannot readily determine the interest
rate implicit in its leases, it uses the relevant incremental
borrowing rate (IBR) to measure lease liabilities. The IBR
is the rate of interest that the Group would have to pay to
borrow over a similar term, and with a similar security, the
funds necessary to obtain an asset of a similar value to the
right-of-use asset in a similar economic environment.
Significant judgement in determining the lease
term of contracts with renewal options
The Group determines the lease term as the non-
cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably
certain to be exercised, or any periods covered by an option
to terminate the lease, if it is reasonably certain not to be
exercised.
Significant judgement in relation to future cash
flow
The Group has several lease contracts relating to premises
and power stations that include extension and termination
options. These options are negotiated by management to
provide flexibility in managing the leased-asset portfolio
and align with the Group’s business needs. Management
exercises significant judgement in determining whether
these extension and termination options are reasonably
certain to be exercised. For renewal options that were
reasonably certain to be exercised, these have been included
in the calculation of right-of-use assets and lease liabilities.
Significant judgement in relation to recovery of
deferred tax assets
Judgement is required to determine whether deferred tax
assets are recognised in the statement of financial position.
Deferred tax assets, including those arising from unused
tax losses, require management to assess the likelihood
that the Group will generate sufficient taxable earnings in
the future periods in order to recognise and utilise those
deferred tax assets. Judgement is also required in respect
of the application of existing tax laws in each jurisdiction
and to identify uncertainties over income tax treatments.
Assumptions about the generation of future taxable profits
depend on management’s estimates of future cash flows.
These estimates of future taxable income are based on
forecast cash flows from operations. To the extent that
future cash flows and taxable income differ significantly from
estimates, the ability of the Group to realise the net deferred
tax assets recorded at the reporting date could be impacted.
Future changes in tax laws in the jurisdictions in which the
Group operates could also limit the ability of the Group to
obtain tax deductions in future periods.
4.
FINANCIAL RISK MANAGEMENT
OBJECTIVES AND POLICIES
The Group’s principal financial instruments comprise
receivables, trade and other payables, finance lease and
equipment loans, cash and cash equivalents, deposits,
equity investments and derivatives.
Risk exposures and responses
The Group manages its exposure to key financial risks in
accordance with the Group’s financial risk management
policy. The objective of the policy is to support the delivery
of the Group’s financial targets while protecting future
financial security.
The main risks arising from the Group’s financial instruments
are interest rate risk, credit risk, equity price risk and liquidity
risk. The Group uses different methods to measure and
manage different types of risks to which it is exposed.
These include monitoring levels of exposure to interest rate,
foreign exchange risk and assessments of market forecasts
for interest rate, foreign exchange and commodity prices.
Ageing analysis and monitoring of receivables are undertaken
to manage credit risk, liquidity risk is monitored through the
development of future rolling cash flow forecasts.
Westgold Resources Limited Annual Report 2023
65
FINANCIAL REPORT
for the year ended 30 June 2023
4.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Risk exposures and responses (continued)
The board reviews and agrees policies for managing each of these risks as summarised below.
Primary responsibility for identification and control of financial risks rests with the Board. The Board reviews and agrees policies for
managing each of the risks identified below, including for interest rate risk, credit allowances and cash flow forecast projections.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed in Note 2 to the financial statements.
(a) Interest rate risk
The Group’s exposure to risks of changes in market interest rates relate primarily to the Group’s interest-bearing liabilities and
cash balances. The level of debt is disclosed in Notes 23 and 24. The Group’s policy is to manage its interest cost using fixed rate
debt. Therefore, the Group does not have any variable interest rate risk on its debt. The Group constantly analyses its interest rate
exposure. Within this analysis, consideration is given to potential renewals of existing positions, alternative financing positions and
the mix of fixed and variable interest rates. There is no significant exposure to changes in market interest rates at the reporting date.
At the reporting date the Group’s exposure to interest rate risk for classes of financial assets and financial liabilities is set out below.
2023
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial assets at fair value through profit and loss
Other financial assets
Financial liabilities
Trade and other payables
Lease liabilities
Interest-bearing liabilities
Net financial assets
2022
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial assets at fair value through profit and loss
Other financial assets
Financial liabilities
Trade and other payables
Lease liabilities
Interest-bearing liabilities
Net financial assets
66
Westgold Resources Limited Annual Report 2023
Floating
interest rate
Fixed interest
Non-interest
bearing
Total carrying
amount
176,411,855
–
–
–
–
–
–
–
176,411,855
6,854,911
6,854,911
8,157,712
8,157,712
4,149,443
–
4,149,443
176,411,855
4,149,443
15,012,623
195,573,921
–
–
–
–
(79,227,398)
(79,227,398)
(5,595,472)
(21,895,346)
–
–
(5,595,472)
(21,895,346)
–
(27,490,818)
(79,227,398)
(106,718,216)
88,855,705
142,701,502
40,000,000
–
182,701,502
–
–
–
–
–
7,122,734
7,122,734
6,799,309
6,799,309
1,930,033
–
1,930,033
142,701,502
41,930,033
13,922,043
198,553,578
–
–
–
–
–
(88,017,524)
(88,017,524)
(10,909,353)
(32,050,458)
–
–
(10,909,353)
(32,050,458)
(42,959,811)
(88,017,524)
(130,977,335)
67,576,243
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
4.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Interest rate risk exposure
Judgements of reasonably possible movements:
+ 0.25% (25 basis points)
- 1.0% (100 basis points)
Post tax profit higher (lower)
Other Comprehensive Income
higher (lower)
30 June
2023
30 June
2022
30 June
2023
30 June
2022
308,721
319,728
(1,234,883)
(1,278,911)
–
–
–
–
(b) Credit risk
Credit risk arises from the financial assets of the Group, which comprises cash and cash equivalents, trade and other
receivables, financial assets representing listed shares and other financial assets held as security and loans. Cash and cash
equivalents are held with National Australia Bank, which is an Australian Bank with an AA- credit rating (Standard & Poor’s).
The Group’s exposure to credit risk arises from potential default of the counter party, with the maximum exposure equal to
the carrying amount of the financial assets (as outlined in each applicable note).
The Group does not hold any credit derivatives to offset its credit exposure.
The Group trades only with recognised, creditworthy third parties and as such collateral is not requested nor is it the Group’s
policy to securitise its trade and other receivables.
Receivable balances are monitored on an ongoing basis with the result that the Group does not have a significant exposure
to bad debts.
Significant concentrations of credit risk are in relation to cash and cash equivalents with Australian banks.
(c) Price risk
Commodity Price Risk
The Group is exposed to commodity price risk on gold sales due to its holdings of gold zero cost collars. Refer to Note 5 for details.
Equity Security Price Risk
The Group’s operations were exposed to equity security price fluctuations arising from investments in equity securities.
Refer to Note 15 for details of equity investments at fair value through profit or loss held at 30 June 2023.
The Group has equity investments, which have shown volatility in price movements over the year. If security prices varied by
20%, with all other variables held constant, the impact on post tax profits and equity at 30 June, is reflected below:
Judgements of reasonably possible movements:
Price + 20%
Price - 20%
Post tax profit higher (lower)
Other Comprehensive Income
higher (lower)
30 June
2023
30 June
2022
30 June
2023
30 June
2022
1,142,080
951,903
(1,142,080)
(951,903)
–
–
–
–
(d) Liquidity risk
Liquidity risk arises from the financial liabilities of the Group and the subsequent ability to meet the obligations to repay the
financial liabilities as and when they fall due.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of equipment
loans.
The table below reflects all contractually fixed payables for settlement, repayment and interest resulting from recognised
financial liabilities as of 30 June 2023. Cash flows for financial liabilities without fixed amount or timing are based on the
conditions existing as 30 June.
Westgold Resources Limited Annual Report 2023
67
FINANCIAL REPORT
for the year ended 30 June 2023
4.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Interest rate risk exposure (continued)
The remaining contractual maturities of the Group’s financial liabilities are:
6 months or less
6 - 12 months
1 - 5 years
Over 5 years
2023
2022
(90,155,224) (100,990,852)
(9,211,017)
(11,321,798)
(19,869,554)
(21,558,211)
–
(119,235,795)
(133,870,861)
Maturity analysis of financial assets and liabilities based on management’s expectation
The risk implied from the values shown in the table below reflects a balanced view of cash inflows and outflows. Leasing
obligations, trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing
operations such as property, plant, equipment and investments of working capital e.g. inventories and trade receivables.
To monitor existing financial assets and liabilities, as well as to enable effective controlling of future risks, management
monitors its Group’s expected settlement of financial assets and liabilities on an ongoing basis.
<6 months
6-12 months
1-5 years
>5 years
Total
2023
Financial assets
Cash and equivalents
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Lease liabilities
Interest-bearing loans
180,928,394
6,854,911
4,149,443
191,932,748
(79,227,398)
–
–
–
–
–
–
–
–
–
–
(1,640,546)
(776,749)
(4,190,794)
(8,720,808)
(5,804,591)
(8,421,478)
(89,588,752)
(6,581,340) (12,612,272)
–
–
–
–
180,928,394
6,854,911
4,149,443
191,932,748
–
(79,227,398)
(6,608,089)
–
(22,946,877)
– (108,782,364)
Net inflow/(outflow)
102,343,996
(6,581,340) (12,612,272)
–
83,150,384
2022
Financial assets
Cash and equivalents
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Lease liabilities
Interest-bearing loans
183,178,708
7,122,734
1,930,033
192,231,475
(88,017,524)
–
–
–
–
–
–
–
–
–
–
(3,685,953)
(2,887,530)
(5,879,451)
(9,287,375)
(8,434,268)
(15,678,760)
(100,990,852)
(11,321,798)
(21,558,211)
Net inflow/(outflow)
91,240,623
(11,321,798)
(21,558,211)
68
Westgold Resources Limited Annual Report 2023
–
–
–
–
–
–
–
–
–
183,178,708
7,122,734
1,930,033
192,231,475
(88,017,524)
(12,452,934)
(33,400,403)
(133,870,861)
58,360,614
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
4.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Interest rate risk exposure (continued)
(e) Fair values
For all financial assets and liabilities recognised in the Consolidated Statement of Financial Position, carrying amount
approximates fair value unless otherwise stated in the applicable notes.
The methods for estimating fair value are outlined in the relevant notes to the financial statements.
The Group uses various methods in estimating the fair value of a financial instrument. The methods comprise:
Level 1 – the fair value is calculated using quoted prices in active markets.
Level 2 – the fair value is estimated using inputs other than quoted prices included in level 1 that are observable for the asset
or liability, either directly (as prices) or indirectly (derived from price).
Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market data.
The fair value of the financial instruments as well as the methods used to estimate the fair value are summarised in the table
below.
2023
Financial assets
Instruments carried at fair value
Listed investments
2022
Financial assets
Instruments carried at fair value
Listed investments
Valuation
technique
market
observable
inputs
(Level 2)
Valuation
technique
non-market
observable
inputs
(Level 3)
Quoted
market price
(Level 1)
8,157,712
8,157,712
6,799,309
6,799,309
–
–
–
–
–
–
–
–
Total
8,157,712
8,157,712
6,799,309
6,799,309
Westgold Resources Limited Annual Report 2023
69
FINANCIAL REPORT
for the year ended 30 June 2023
4.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Interest rate risk exposure (continued)
(f) Changes in liabilities arising from financing activities
Opening
Cash flows
New leases
Reclassi-
fication
adjustment
Closing
Lease liability
2023
Current obligations
Non-current obligations
Total liabilities
2022
Current obligations
Non-current obligations
Total liabilities
Interest bearing liability
2023
Current obligations
Non-current obligations
Total liabilities
2022
Current obligations
Non-current obligations
Total liabilities
6,004,390
(6,493,657)
489,267
2,111,143
2,111,143
4,904,963
–
690,509
(2,111,143)
3,484,329
10,909,353
(6,493,657)
1,179,776
–
5,595,472
5,469,969
(9,037,306)
3,567,337
6,004,390
6,004,390
1,868,565
–
9,040,788
(6,004,390)
4,904,963
7,338,534
(9,037,306)
12,608,125
–
10,909,353
Opening
Cash flows
Additions
Reclassi-
fication
adjustment
Closing
16,837,629
(10,155,112)
(6,682,516)
13,831,644
13,831,645
15,212,829
–
6,682,516 (13,831,644)
8,063,701
32,050,458
(10,155,113)
–
– 21,895,346
17,492,098
(28,133,801)
10,641,703
16,837,629
16,837,629
20,245,206
–
11,805,252
(16,837,629)
15,212,829
37,737,304
(28,133,801) 22,446,955
– 32,050,458
70
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
5. REVENUE
Sale of gold at spot
Sale of gold under forward contracts(1)
Total revenue from contracts with customers
Disaggregated revenue per segment has been disclosed in Note 32.
1.
Gold sold under forward contracts
2023
2022
325,212,443 336,730,400
329,158,791
310,846,218
654,371,234
647,576,618
The Group’s operations are exposed to commodity price fluctuations. The Group has a commodity risk management
hedging policy that authorises management to enter into price protection contracts to ensure revenue streams up to 60%
of gold sales for up to three years of forecast production.
At the end of the financial year, the Group had unrecognised gold forward contracts for 10,000 ounces at an average price
of $2,459 per ounce ending in July 2023, under which the Group will deliver physical gold to settle. The Group also had
30,000 ounces of gold put options of $2,700/oz and gold call options of $3,340/oz. The value of the zero-cost collars at
financial year end was deemed to be immaterial. Refer to Note 4(c) Commodity Price Risk.
The transaction price allocated to remaining performance obligations under forward contracts not recognised at the
balance sheet date at 30 June 2023 is as follows:
Gold forward contracts
- Within 1 year
- 1 to 2 years
The amounts due are for delivery of gold which will be paid within 3 days of delivery.
6. OTHER INCOME
Interest income calculated using the effective interest rate method
Net gain on sale of financial assets at FVTPL
Net gain on sale of property, plant and equipment
Other income
Total other income
2023
2022
24,594,000 330,707,005
–
23,964,276
24,594,000
354,671,281
2023
2022
3,447,526
266,150
(190,939)
–
4,448,016
1,316,434
3,295,285
3,080,833
10,999,888
4,663,417
Westgold Resources Limited Annual Report 2023
71
FINANCIAL REPORT
for the year ended 30 June 2023
7. EXPENSES
(a) Cost of sales
Gold production
Salaries, wages expense and other employee benefits
Other production costs
Write down in value of inventories to estimated net realisable value
Royalty expense
Depreciation and amortisation expense
Depreciation of non-current assets:
Plant and equipment
Buildings
Right-of-use assets
Amortisation of non-current assets:
Mine properties and development costs
Total cost of sales
(b) Finance costs
Interest expense
Capitalised borrowing costs to qualifying asset
Unwinding of rehabilitation provision discount
Total finance costs
2023
2022
160,623,325
175,906,269
295,008,423
218,314,978
–
10,252,203
23,082,403
23,537,397
43,906,314
54,409,633
1,986,122
2,095,532
6,139,491
8,249,706
100,852,823
127,535,100
631,598,901
620,300,818
1,686,525
1,648,881
–
(1,145,680)
770,760
895,459
2,457,285
1,398,660
Big Bell Underground Mine went into commercial production on 1 April 2022. Subsequent to going into commercial
production, none of the borrowing costs have been capitalised.
72
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7. EXPENSES (CONTINUED)
(c) Other expenses
Administration expenses
Employee benefits expense
Salaries and wages expense
Directors' fees and other benefits
Other employee benefits
Share-based payments expense
Other administration expenses
Consulting expenses
Subscriptions
Recruitment and relocation
Business development
Insurance
Travel and accommodation expenses
Other costs
Depreciation expense
Property plant and equipment
Right-of-use assets
Total other expenses
2023
2022
8,198,787
6,555,882
576,708
377,746
165,478
87,033
1,039,025
618,435
9,979,998
7,639,096
1,505,099
2,170,807
1,028,757
273,090
437,108
255,911
759,619
91,125
437,486
396,621
238,346
92,200
2,055,863
1,157,911
6,462,278
4,437,665
383,053
374,671
544,573
516,028
927,626
890,699
17,369,902
12,967,460
Westgold Resources Limited Annual Report 2023
73
FINANCIAL REPORT
for the year ended 30 June 2023
8. INCOME TAX
(a) Major components of income tax expense:
Income Statement
Current income tax expense
Current income tax (benefit) expense
Adjustment in respect of current income tax of previous years
Deferred income tax
Relating to origination and reversal of temporary differences
Adjustment in respect of prior year tax losses / DTA
Income tax for continuing and discontinuing operations
(b) Amounts charged or credited directly to equity
Share issue costs
(c) A reconciliation of income tax benefit and the product of accounting loss before
income tax multiplied by the Group’s applicable income tax rate is as follows:
Accounting profit (loss) before tax from continuing operations
Total accounting profit (loss) before income tax
At statutory income tax rate of 30% (2022: 30%)
Non-assessable income
Under (over) in respect of prior years
Income tax (benefit) expense reported in the income statement
Tax expense from continuing operations
Income tax (benefit) expense reported in the income statement
2023
2022
(17,818,544)
(10,632,327)
–
–
21,878,828
(39,878,133)
(114,299)
1,543,233
3,945,985
(48,967,227)
470,670
470,670
(565,590)
(565,590)
13,949,469 (160,086,518)
13,949,469 (160,086,518)
4,184,840
(48,025,955)
(124,556)
(459,389)
(114,299)
(481,883)
3,945,985
(48,967,227)
3,945,985
(48,967,227)
3,945,985
(48,967,227)
74
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
8. INCOME TAX (CONTINUED)
(d) Deferred income tax at 30 June relates to the following:
Deferred tax liabilities
Exploration
Consolidated Statement of
Financial Position
Consolidated Statement of
Comprehensive Income
2023
2022
2023
2022
(22,751,899) (16,538,683)
6,213,216
5,068,766
Trade and other receivables
(639,932)
(341,375)
298,557
(334,642)
Prepayments
Deferred mining
Inventories
(10,141)
(16,394)
(6,253)
4,555
(28,796,912)
(32,761,755)
(3,964,843)
(43,709,681)
(10,905,583)
(10,964,932)
(59,349)
2,261,854
Property plant and equipment
(8,691,031)
(7,729,115)
961,916
1,743,102
Gross deferred tax liabilities
(71,795,498) (68,352,254)
Deferred tax assets
Net gain on financial assets FVTPL
453,115
423,071
(30,044)
(604,212)
Accrued expenses
390,096
718,292
328,197
116,382
Provision for employee entitlements
4,637,450
4,820,069
182,620
(715,206)
Provision for rehabilitation
Business related costs
Capital raising costs
Recognised tax losses
Gross deferred tax assets
Net deferred tax liabilities
Deferred tax expense
11,069,385
17,696,605
6,627,219
(3,609,899)
165,227
162,179
(3,048)
(99,151)
896,406
1,367,076
–
–
24,073,447
17,471,245 (6,602,203)
(9,089,097)
41,685,126
42,658,537
(30,110,372)
(25,693,717)
3,945,985
(48,967,227)
(e) Unrecognised losses
At 30 June 2023, there are no unrecognised losses for the Group (2022: nil).
Westgold Resources Limited Annual Report 2023
75
FINANCIAL REPORT
for the year ended 30 June 2023
9. EARNINGS PER SHARE
The following reflects the data used in the basic and diluted earnings per share computations.
(a) Earnings used in calculating earnings per share
Net profit/(loss) attributable to ordinary equity holders of the parent
Net profit attributable to ordinary equity holders of the parent
Basic earnings/(loss) per share (cents)
Earnings used in calculating earnings per share
For diluted earnings per share:
2023
2022
10,003,484
(111,119,291)
10,003,484
(111,119,291)
2.11
2.11
(25.32)
(25.32)
Net profit/(loss) attributable to ordinary equity holders of the parent (from basic EPS)
Net profit attributable to ordinary equity holders of the parent
10,003,484
(111,119,291)
10,003,484
(111,119,291)
Diluted profit/(loss) per share (cents)
Continuing operations
(b) Weighted average number of shares
2.11
2.11
(25.32)
(25.32)
Weighted average number of ordinary shares for basic earnings per share
473,622,730 438,907,701
Effect of dilution:
Rights
–
–
Weighted average number of ordinary shares adjusted for the effect of dilution
473,622,730 438,907,701
Basic EPS is calculated by dividing the profit for the year attributable to ordinary equity holders of the parent by the
weighted average number of ordinary shares outstanding during the year. Diluted EPS is calculated by dividing the profit
attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during
the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential
ordinary shares into ordinary shares.
There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date
and the date of authorisation of these financial statements.
The Company had 4,438,946 performance rights (contingently issued shares) on issue that are excluded from the
calculation of diluted loss per share for the current financial period.
76
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10. CASH AND CASH EQUIVALENTS
Cash at bank and in hand
Short-term deposits
Cash at bank and in hand
CASH FLOW RECONCILIATION
Reconciliation of net profit after income tax to net cash flows from operating activities
Profit/(loss) before income tax
Amortisation and depreciation
Income tax (benefit)/expense
Share based payments
Unwinding of rehabilitation provision discount
Net loss/(profit) on disposal of property, plant and equipment
Profit on disposal of fair value financial assets
Fair value change in financial instruments (refer to Note 15)
Impairment of mine properties and property plant and equipment (refer to Note 17)
Exploration and evaluation expenditure written off (refer to Note 18)
Changes in assets and liabilities
(Increase)/decrease in inventories
Increase in trade and other receivables and prepayments
Increase/(decrease) in trade and other creditors
Increase/(decrease) in provisions
Net cash flows from operating activities
2023
2022
176,411,855
142,701,502
– 40,000,000
176,411,855
182,701,502
10,003,484
(111,119,291)
153,812,376
193,180,670
3,945,984
(48,967,227)
1,039,025
618,435
770,760
895,459
(4,448,016)
(1,316,434)
190,939
–
(4,435)
2,014,040
–
–
175,535,410
110,165
165,310,117
210,951,227
13,342,615
(36,952,721)
(754,936)
(1,047,740)
(8,790,126)
4,520,668
(674,452)
2,384,020
168,433,218
179,855,454
At 30 June 2023, the Group had available $8,457,321 (2022: $3,156,781) of undrawn borrowing facilities.
11. TRADE AND OTHER RECEIVABLES (current)
Statutory receivables
Other debtors
Total trade and other receivables
2023
2022
5,858,984
6,453,347
995,927
669,387
6,854,911
7,122,734
Statutory receivables comprises of GST input tax credits and diesel fuel rebates.
Other debtors are non-interest bearing and generally have a 30-60 day term.
All trade and other receivables are classed as recoverable in full, none of which were past due. The carrying amount of other
debtors approximate their fair value. Refer Note 4(b) for credit risk disclosures.
Westgold Resources Limited Annual Report 2023
77
FINANCIAL REPORT
for the year ended 30 June 2023
12. INVENTORIES (current)
Ore stocks at net realisable value
Gold in circuit at cost
Gold metal at cost
Stores and spares at cost
Provision for obsolete stores and spares
Total inventories at lower of cost and net realisable value
2023
2022
25,577,725
37,699,414
16,293,902 20,870,066
3,901,481
–
44,459,486 44,208,485
(7,493,121)
(6,695,876)
82,739,473 96,082,089
During the year there were no write-downs in inventories (2022: $10,252,203) from continuing operations for the Group.
This is included in cost of sales refer to Note 7(a).
13. PREPAYMENTS (current)
Prepayments
Prepayments include insurances, software licenses and subscriptions.
14. OTHER FINANCIAL ASSETS (current)
Cash on deposit
The cash on deposit is interest bearing and is used as security for bank guarantees.
15. FINANCIAL ASSETS
Listed shares - Australian
Movement in Listed Shares
At 1 July
Additions of listed shares
Proceeds on disposal of financial assets
Loss on disposal of financial assets
Net gain /(loss) on fair value changes of financial assets
At 30 June
2023
2022
6,449,836
5,427,078
6,449,836
5,427,078
2023
2022
4,149,443
1,930,033
4,149,443
1,930,033
2023
2022
8,157,712
6,799,309
8,157,712
6,799,309
6,799,309
6,423,091
1,955,248
2,390,258
(476,062)
(125,218)
–
–
4,435
(2,014,040)
8,157,712
6,799,309
78
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
15. FINANCIAL ASSETS (CONTINUED)
Listed shares
These financial assets consist of investments in ordinary shares. The fair value of equity investments at fair value through
profit or loss has been determined directly by reference to published price quotations in an active market(Level 1).
Movement in investments during the year ended 30 June 2023 are as follows:
–
–
The Group has a 2.48% (30 June 2022: 1.01%) interest in Musgrave Minerals Limited, which is involved in the exploration
of gold and base metals in Australia. Musgrave is listed on the Australian Securities Exchange (ASX: MGV). At the end
of the period, the fair value of the Group’s investment was $4,182,673 (30 June 2022: $1,335,747) which is based on the
quoted share price.
The Group has a 11.58% (2022: 14.78%) interest in Alto Metals Limited which is involved in the exploration of gold and base
metals in Australia. Alto is listed on the Australian Securities Exchange (ASX: AME). At the end of the year, the fair value of
the Group’s investment was $3,975,039 (2022: $5,463,561) which is based on the quoted share price.
16. PROPERTY, PLANT & EQUIPMENT
Plant and equipment
Gross carrying amount at cost
Accumulated depreciation and impairment
Net carrying amount
Land and buildings
Gross carrying amount at cost
Accumulated depreciation and impairment
Net carrying amount
Capital work in progress at cost
Total property, plant and equipment
Movement in property, plant and equipment
Plant and equipment
At 1 July net of accumulated depreciation
Transfer from capital work in progress
Disposals
Impairment write-down (refer to Note 17)
Depreciation charge for the year
At 30 June net of accumulated depreciation
2023
2022
378,943,868
377,434,401
(284,067,365)
(264,485,838)
94,876,503
112,948,563
26,774,075
26,474,862
(11,107,700)
(9,121,579)
15,666,375
17,353,283
30,360,293
17,614,257
140,903,171
147,916,103
112,948,563
141,224,081
27,420,667
46,224,414
(1,203,359)
(7,314,376)
–
(12,401,251)
(44,289,369)
(54,784,305)
94,876,503
112,948,563
Westgold Resources Limited Annual Report 2023
79
FINANCIAL REPORT
for the year ended 30 June 2023
16. PROPERTY, PLANT & EQUIPMENT (CONTINUED)
Land and buildings
At 1 July net of accumulated depreciation
Transfer from capital works in progress
Depreciation charge for the year
At 30 June net of accumulated depreciation
Capital work in progress
At 1 July
Additions
Transfer to mine properties (refer to Note 17)
Transfer to mine capital development (refer to Note 17)
Transfer to plant and equipment
Transfer to land and buildings
At 30 June
2023
2022
17,353,283
17,372,278
299,212
2,076,537
(1,986,120)
(2,095,532)
15,666,375
17,353,283
17,614,257
8,151,819
45,759,537
60,185,474
(5,055,590)
(898,122)
(238,033)
(1,523,963)
(27,420,667)
(46,224,414)
(299,212)
(2,076,537)
30,360,293
17,614,257
The carrying value of plant and equipment purchase under financing arrangements at 30 June 2023 is $29,485,283 (2022:
$34,874,588).
Assets under equipment loans are pledged as security for the related interest bearing liabilities (refer to Notes 23 and 24).
17. MINE PROPERTIES AND DEVELOPMENT
Mine properties
Gross carrying amount at cost
Accumulated amortisation and impairment
Net carrying amount
Mine capital development
Gross carrying amount at cost
Accumulated amortisation and impairment
Net carrying amount
Total mine properties and development costs
2023
2022
368,689,838
363,637,652
(214,118,850)
(190,388,957)
154,570,988
173,248,695
583,531,191
492,782,758
(479,314,529)
(402,227,896)
104,216,662
90,554,862
258,787,650
263,803,557
80
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17. MINE PROPERTIES AND DEVELOPMENT (CONTINUED)
Movement in mine properties and development
Mine properties
At 1 July net of accumulated amortisation
Additions
Transfer from capital work in progress (refer to Note 16)
Transfer from mine capital development
Transfer from exploration (refer to Note 18)
Decrease in rehabilitation provision
Amortisation charge for the year
Impairment write-down
At 30 June net of accumulated amortisation
Mine capital development
At 1 July net of accumulated amortisation
Additions
Transfer from capital work in progress (refer to Note 16)
Transfer from exploration (refer to Note 18)
Transfer to capital development
Amortisation charge for the year
Impairment write-down
At 30 June net of accumulated amortisation
IMPAIRMENT OF MINE PROPERTIES AND DEVELOPMENT
Murchison CGO CGU
Mine properties
Mine capital development
Murchison MGO CGU
Mine properties
Mine capital development
Property Plant and Equipment (refer to Note 16)
Bryah FGO CGU
Mine properties
Mine capital development
Property Plant and Equipment (refer to Note 16)
Impairment loss before income tax
2023
2022
173,248,695
272,124,342
2,717,004
51,886,544
5,055,589
898,122
–
–
3,455,983
1,518,725
(2,720,408)
(9,067,232)
(23,729,892)
(28,900,121)
–
(118,667,667)
154,570,988
173,248,695
90,554,862
135,211,578
90,510,400
98,653,906
238,033
–
–
1,523,963
1,722,869
(3,455,983)
(77,086,633)
(98,634,979)
–
(44,466,492)
104,216,662
90,554,862
2023
2022
–
–
–
–
–
–
–
–
107,892,672
1,530,969
5,815,456
19,833,030
10,637,100
4,959,539
23,102,493
1,764,151
175,535,410
Westgold Resources Limited Annual Report 2023
81
FINANCIAL REPORT
for the year ended 30 June 2023
17. MINE PROPERTIES AND DEVELOPMENT (CONTINUED)
Results of impairment testing
Mine Properties and development
Westgold is a dynamic, growth oriented Western Australian gold miner and is unique in the Australian gold sector as an
owner operator. Westgold’s operations are comprised of:
–
–
the Bryah Operations at Fortnum (FGO)
the Murchison Operations at Meekatharra (MGO) and Cue (CGO)
These operations are the Cash Generating Units of the Group as they each operate independent of the other.
A Cash Generating Unit (CGU) is defined as the smallest group of assets that includes the assets and generates cash flows
that are largely independent of the cash inflows from other assets or group of assets.
In assessing whether an impairment is required, the carrying value of the asset or CGU is compared with its recoverable
amount. The recoverable amount is the higher of the CGU’s fair value less costs of disposal (FVLCD) and value in use
(VIU). Given the nature of the Group’s activities, information on the fair value of an asset is usually difficult to obtain unless
negotiations with potential purchasers or similar transactions are taking place. Consequently, the VIU for each CGU has
been estimated based on discounted future estimated cash flows (expressed in real terms) expected to be generated
from the continued use of the CGUs using market-based commodity price and exchange assumptions. Production and
cost assumptions were derived from estimated quantities of recoverable minerals, production levels, operating costs and
capital requirements, and its eventual disposal, based on the CGU latest life of mine (LOM) plans. These cash flows were
discounted using a real post-tax discount rate that reflects the weighted average cost of capital of the Group.
Estimates of quantities of recoverable minerals, production levels, operating costs and capital requirements are generated
as part of the Group’s planning process, including LOM plans, budgets, forecasts and CGU-specific studies.
This assessment is in accordance with the relevant accounting standards taking into consideration the current outlook for
gold prices, increasing supply chain cost pressures including diesel fuel, consumables, labour costs and interest rates while
maintaining the production, processing and recovery assumptions.
In performing the impairment assessment, the company determined that the carrying value of each CGU did not exceed its
recoverable amount. Therefore, no impairment was recorded for the 30 June 2023 period (30 June 2022: $175,535,410).
Key Assumptions
The table below summarises the key assumptions used in the 2023 year end carrying value assessments.
Assumption
Gold price ($/oz)
Discount rate
Value
A$2,794/oz – A$2,100/oz real
5.5% real post tax
Gold prices
Gold prices are estimated with reference to external market forecasts based on a consensus view of market experts.
Discount rate
In determining the fair value of CGU’s, the future real cashflows are discounted using rates based on the Group’s estimated
after tax real weighted average cost of capital with a mid-point of 5.5%.
Operating and capital costs
Life of mine operating and capital cost assumptions are based on the Group’s latest budget and life-of-mine plans.
Climate related risks
The potential financial impact of climate related risks have been considered in impairment test through the inclusion of
committed initiatives in cash flow forecasts including commitments to replace the Diesel power generation with solar and
gas power generation.
82
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17. MINE PROPERTIES AND DEVELOPMENT (CONTINUED)
Sensitivity Analysis
Any variation in the key assumptions impacts the recoverable value of the CGU’s. In its 30 June 2023 assessment, the
recoverable amount was approximately the same as the carrying amount for each CGU. Therefore, if the variation in an
assumption has a negative impact on recoverable value, it could indicate a requirement for additional impairment of
non-current assets for any of the CGU’s. Reciprocally, if the variation in an assumption has a positive impact on recoverable
value, it could indicate a requirement for a reversal of impairment charged and accumulated in the prior period. The
maximum reversal will be capped at the prior period impairment.
Murchison CGO Sensitivity Analysis
It is estimated that changes in key assumptions, in isolation, would have the following approximate increase/(decrease) on
the recoverable amount of the Murchison CGO CGU as at 30 June 2023.
Murchison CGO
10% change in gold price ($/oz.)
100 basis point in discount rate
10% change in operating cost
Increase in key assumption
$’m
Decrease in key assumption
$’m
109
(13)
(97)
(153)
13
97
Murchison MGO Sensitivity Analysis
It is estimated that changes in key assumptions, in isolation, would have the following approximate increase/(decrease) on
the recoverable amount of the Murchison MGO CGU as at 30 June 2023.
Murchison MGO
10% change in gold price ($/oz.)
100 basis point in discount rate
10% change in operating cost
Increase in key assumption
$’m
Decrease in key assumption
$’m
36
(6)
(119)
(134)
6
26
Bryah Sensitivity Analysis
It is estimated that changes in key assumptions, in isolation, would have the following approximate increase/(decrease) on
the recoverable amount of the Bryah FGO CGU as at 30 June 2023.
Bryah -FGO
10% change in gold price ($/oz.)
100 basis point in discount rate
10% change in operating cost
Increase in key assumption
$’m
Decrease in key assumption
$’m
30
(1)
(32)
(32)
1
30
Westgold Resources Limited Annual Report 2023
83
FINANCIAL REPORT
for the year ended 30 June 2023
18. EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation costs carried forward in respect of mining areas of interest
Pre-production areas
At cost less expenditure written off
Net carrying amount
Movement in deferred exploration and evaluation expenditure
At 1 July net of accumulated impairment
Additions
Transferred to mine properties (refer to Note 17)
Transferred to mine capital development (refer to Note 17)
Expenditure written off - continuing operations
2023
2022
123,487,370 104,577,467
123,487,370 104,577,467
104,577,467
89,738,936
18,909,901
18,190,290
–
–
–
(1,518,725)
(1,722,869)
(110,165)
At 30 June net of accumulated impairment
123,487,368 104,577,467
The ultimate recoupment of costs carried forward for exploration and evaluation phases is dependent on the successful
development and commercial exploitation or sale of the respective mining areas. During the year, a review was undertaken
for each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area
of interest. In assessing the carrying value of all of the Group’s projects, there were no expenditure on exploration and
evaluation of mineral resources written off during the year (2022: $110,165) to the profit and loss.
84
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19. RIGHT- OF-USE ASSETS
Group as a lessee
The Group has lease contracts for various items of mining equipment, power stations, motor vehicles and buildings used in
its operations. Leases of mining equipment generally have lease terms between three and seven years, while motor vehicles
and buildings generally have lease terms between three and five years.
The Group also has certain leases of assets with lease terms of 12 months or less and leases of office equipment with low
value. The Group applies the short-term lease and lease of low-value assets recognition exemptions for these leases.
Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:
As at 1 July 2022
Additions
Disposals
Power
Stations
Premises
Mining
Equipment
Total
5,749,531
4,602,730
462,441
10,814,702
277,191
–
–
–
902,585
1,179,776
–
–
Accumulated Depreciation expense
(5,196,922)
(950,555)
(536,586) (6,684,063)
As at 30 June 2023
829,800
3,652,175
828,440
5,310,415
Set out below are the carrying amounts of lease liabilities (included under interest-bearing loans and borrowings) and the
movements during the period:
As at 1 July
Additions
Disposals
Accretion of interest
Payments
As at 30 June
The following are the amounts recognised in profit or loss:
Depreciation expense for right-of-use assets
Included in cost of sales
Included in administration expenses (refer to Note 7)
Interest expense on lease liabilities
Less interest expense capitalised to qualifying asset
Total amount recognised in profit or loss
2023
2022
10,814,702
7,258,887
1,179,776
12,321,549
–
–
622,347
271,572
(7,306,410)
(9,037,306)
5,310,415
10,814,702
6,139,491
8,249,706
544,573
516,028
622,347
271,572
–
(158,195)
7,306,411
8,879,111
Westgold Resources Limited Annual Report 2023
85
FINANCIAL REPORT
for the year ended 30 June 2023
20. TRADE AND OTHER PAYABLES
Trade creditors(a)
Sundry creditors and accruals(b)
The carrying value of trade and other payables approximates the fair value.
(a)
(b)
Trade creditors are non-interest bearing and generally on 30-day terms.
Sundry creditors and accruals are non-interest bearing and generally on 30-day terms.
21. PROVISIONS (current)
Provision for annual leave
Provision for long service leave
22. PROVISIONS ( non-current)
Provision for long service leave
Provision for rehabilitation(a)
2023
2022
29,262,357
47,637,236
49,965,041 40,380,288
79,227,398
88,017,524
2023
2022
9,340,463
10,865,164
2,468,795
2,201,062
11,809,258
13,066,226
2023
2022
3,648,908
3,000,672
62,625,784
66,669,167
66,274,692
69,669,839
(a) Provision for rehabilitation
The Group makes full provision for the future cost of rehabilitating mine sites and related production facilities on a
discounted basis at the time of developing the mines and installing and using those facilities. The rehabilitation provision
represents the present value of rehabilitation costs relating to mine sites, which are expected to be incurred up to 2033
which is when the producing mine properties are expected to cease operations. These provisions have been created based
on the Group’s internal estimates. Assumptions based on the current economic environment have been made, which
management believe is a reasonable basis upon which to estimate the future liability.
These estimates are reviewed regularly to take into account any material changes to the assumptions. However, actual
rehabilitation costs will ultimately depend upon future market prices for the necessary rehabilitation works required that
will reflect market conditions at the relevant time. Furthermore, the timing of rehabilitation is likely to depend on when the
mines cease to produce at economically viable rates. This, in turn, will depend upon future gold prices, which are inherently
uncertain.
The discount rates used in the calculation of the provision as at 30 June 2023 range from 3.95% to 4.03% (2022: range from
3.34% to 3.58%). Refer to Note 3 for further detail.
(b) Current and non-current movements in provision for rehabilitation
At 1 July
Adjustment due to revised conditions
Unwind of discount
At 30 June
86
Westgold Resources Limited Annual Report 2023
2023
2022
66,669,167
74,840,940
(4,814,142)
(9,067,232)
770,760
895,459
62,625,785
66,669,167
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. INTEREST-BEARING LOANS AND BORROWINGS (current)
Lease liabilities
Equipment loans
At 30 June
2023
2022
2,111,143
6,004,390
13,831,644
16,837,629
15,942,787
22,842,019
Represents current portion of equipment loans which have repayment terms of 36 months from inception.
24. INTEREST-BEARING LOANS AND BORROWINGS (non-current)
Lease liabilities
Equipment loans
At 30 June
2023
2022
3,484,329
4,904,963
8,063,702
15,212,829
11,548,031
20,117,792
Represents non-current portion of equipment loans which have repayment terms of 36 months from inception.
The weighted average interest rate is 7.91% per annum (2022: 3.91%).
Assets pledged as security:
The carrying amounts of assets pledged as security for current and non-current interest-bearing liabilities:
Non-current
Equipment loans
Plant and equipment
Total non-current assets pledged as security
2023
2022
29,485,283
34,874,588
29,485,283
34,874,588
Plant and equipment assets are pledged against liabilities for the term of the arrangement.
Future commitments in respect of interest bearing loans
Equipment loan commitments
The Company has equipment loans for various items of plant and machinery. The equipment loans have an average term of
36 months. Assets under equipment loans are pledged as security for the related interest bearing liabilities.
Interest bearing liabilities
2023
Within one year
After one year but not more than five years
Total minimum payments
Less amounts representing finance charges
Present value of minimum payments
Minimum
payments
Present value
of payments
14,525,399
13,831,644
8,421,478
8,063,702
22,946,877 21,895,346
(1,051,531)
–
21,895,346 21,895,346
Westgold Resources Limited Annual Report 2023
87
FINANCIAL REPORT
for the year ended 30 June 2023
24. INTEREST-BEARING LOANS AND BORROWINGS (non-current) (CONTINUED)
Non-current (continued)
Interest bearing liabilities
2022
Within one year
After one year but not more than five years
Total minimum payments
Less amounts representing finance charges
Present value of minimum payments
Minimum
payments
Present value
of payments
17,721,643
16,837,629
15,678,760
15,212,829
33,400,403 32,050,458
(1,349,945)
–
32,050,458 32,050,458
Lease liabilities
AASB 16 Leases requires the recognition of right-of-use assets for the remaining term of the current leases for office
premises and the warehouse facility, as well as the power stations and equipment at the various mine sites.
Minimum
lease
payments
Present
value of lease
payments
2,417,295
2,111,143
4,190,794
3,484,329
6,608,089
5,595,472
(1,012,617)
–
5,595,472
5,595,472
Minimum
lease
payments
Present
value of lease
payments
6,573,483
6,004,390
5,879,451
4,904,963
12,452,934
10,909,353
(1,543,581)
–
10,909,353
10,909,353
Lease liabilities
2023
Within one year
After one year but not more than five years
Total minimum lease payments
Less amounts representing finance charges
Present value of minimum lease payments
Lease liabilities
2022
Within one year
After one year but not more than five years
Total minimum lease payments
Less amounts representing finance charges
Present value of minimum lease payments
88
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25. ISSUED CAPITAL
(a) Ordinary Shares
Issued and fully paid
(b) Movements in ordinary shares on issue
At 1 July 2021
Issued share capital
Issued share capital on exercise of rights (f)
Issued share capital under dividend reinvestment plan
Share issue costs, net of tax
At 30 June 2022
Issued share capital on exercise of listed rights
Issued share capital under dividend reinvestment plan
Issued share capital
Share issue costs, net of tax
At 30 June 2023
2023
2022
462,997,480
463,468,148
Number
$
423,925,206
364,077,523
48,000,000
100,800,000
332,332
–
1,365,192
2,157,835
–
(3,567,210)
473,622,730
463,468,148
–
–
–
–
–
–
–
(470,668)
473,622,730
462,997,480
(c) Terms and conditions of contributed equity
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at shareholder meetings. In the event of winding up the Company the holders are entitled to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Effective
1 July 1998, the Corporations legislation in place abolished the concepts of authorised capital and par share values.
Accordingly, the Parent does not have authorised capital nor par value in respect of its issued shares.
(d) Escrow restrictions
There are no current escrow restrictions on the issued capital of the Company.
(e) Performance Rights on issue
Unissued ordinary shares of the Company under performance rights at the date of this report are as follows:
Type
Unlisted - Tranche 5 (i)
Unlisted - Tranche 6 (i)
Total
Expiry Date
30/06/2024
30/06/2025
(i)
Rights issued pursuant to the Westgold Resources Limited Employee Share Performance Rights Plan.
Exercise
Price
Number of
performance
rights
Nil
Nil
1,161,058
2,567,547
3,728,605
Westgold Resources Limited Annual Report 2023
89
FINANCIAL REPORT
for the year ended 30 June 2023
25. ISSUED CAPITAL (CONTINUED)
(f) Performance Rights conversions
No listed performance rights were exercised during the financial year (2022: 332,332).
(g) Capital management - gearing ratio
Gearing ratio
Debt
Capital
2023
2022
4.59%
7.31%
27,490,818
42,959,811
598,339,298 587,767,457
Capital includes issued capital and all other equity reserves attributable to the equity holders of the parent for the
purpose of the Group’s capital management. The primary objective of the Group’s capital management is to ensure that it
maintains a strong credit rating and healthy capital ratios in order to support its business and maximise the shareholder’s
value. The Group manages its capital structure and makes adjustments in light of changes in economic conditions and
the requirements of the financial covenants. To maintain or adjust the capital structure, the Group may return capital to
shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended
30 June 2023 and 30 June 2022. The Group monitors capital using a gearing ratio, which is debt divided by the aggregate
of equity. The Group includes in its net debt, interest bearing loans and borrowings. The Group’s aim is to keep the gearing
ratio between 5% and 20%.
26. RETAINED EARNINGS (ACCUMULATED LOSSES)
At 1 July
Net profit/(loss) in current year attributable to members of the parent entity
Dividends paid
At 30 June
27. RESERVES
At 30 June 2021
Share-based payments
At 30 June 2022
Share-based payments
At 30 June 2023
2023
2022
(73,079,253) 46,522,657
10,003,484
(111,119,291)
–
(8,482,619)
(63,075,769) (73,079,253)
Share-based
payments
reserve
Equity
reserve
Total
15,266,496
181,493,631
196,760,127
618,435
–
618,435
15,884,931
181,493,631
197,378,562
1,039,025
–
1,039,025
16,923,956 181,493,631
198,417,587
Equity reserve
This reserve relates to the intercompany loans with Metals X Ltd written off on demerger of the Group.
Share-based payments reserve
This reserve is used to recognise the fair value of instruments issued to employees in relation to equity-settled share-based
payments.
90
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. SHARE-BASED PAYMENTS
(a) Recognised share-based payment expense
The expense recognised for services received during the year is shown in the table below:
Expense arising from equity-settled share-based payments
2023
2022
1,039,025
618,435
The share-based payment plan is described below. There have been no cancellations or modifications to the plan during
2023, 2022, 2021 and 2020.
(b) Transactions settled using shares
There were no transactions settled using shares in the year ending 30 June 2023.
(c) Employee share and option plan
Under the Employee Share and Option Plan (ESOP), grants are made to senior executives and other staff members who
have made an impact on the Group’s performance. ESOP grants are delivered in the form of share options or performance
rights which vest over periods as determined by the Board of Directors.
(d) Performance rights (Rights)
Unlisted Employee Performance Rights are issued to senior management under the Employee Share Option Plan, the
principal terms being:
The Performance Rights have been issued for nil consideration.
–
– Exercise Price of a Performance Right is nil
–
–
The Performance Rights measurement date for Tranche 6 is 31 March 2025 and Tranche 5 is 31 March 2024
The Performance Rights are subject to defined Performance Conditions as below:
– Growth in Relative Total Shareholder Return (RTSR)
– Growth in Absolute Total Shareholder Return (ATSR)
– Growth in Absolute Earnings Per Share (EPS)
– Ore Reserve Growth
– Operational Growth
Tranche 6
Tranche 5
30%
30%
30%
10%
–
25%
25%
25%
–
25%
–
–
–
Subject to the terms contained in this Offer, the Performance Rights will not be transferable in whole or in part (except, in
the case of the Performance Right holder’s death, by his or her legal personal representative).
The Company will issue fully paid ordinary Shares ranking pari passu with the issued ordinary shares once the
Performance Rights have vested.
The Company will apply for listing on the ASX of the resultant Shares of the Company issued upon vesting of any
Performance Rights.
– A Performance Rights holder cannot participate in dividends or bonus issues, with respect to those Performance Rights,
unless those Performance Rights are vested.
– A Performance Rights holder does not have any right to participate in new issues of securities in the Company made to
–
shareholders with respect to those Performance Rights.
The Board has the right to vary the entitlements of Participants to take account of the effect of capital reorganisations,
bonus issues or rights issues.
– No amount is payable by a holder of Performance Rights in respect of the shares allocated upon vesting of the
Performance Rights.
Westgold Resources Limited Annual Report 2023
91
FINANCIAL REPORT
for the year ended 30 June 2023
28. SHARE-BASED PAYMENTS (CONTINUED)
(d) Performance rights (Rights) (continued)
Summary of rights granted under the Employee Share and Option Plan
Outstanding at the beginning of the year
Granted during the year
Exercised during the year
Lapsed/forfeited during the year
Outstanding at the year end
Exercisable at the year end
2023
Number
2023
WAEP
2022
Number
2022
WAEP
2,459,072
3,159,585
(126,564)
(1,053,147)
4,438,946
–
–
–
–
–
–
–
2,213,898
2,128,138
(205,768)
(1,677,196)
2,459,072
–
–
–
–
–
–
–
The following table represents the outstanding balance as at 30 June 2023:
Grant Date Vesting date Expiry date
ZEPO - Tranche 3
Exercise
price
Number of
Options /
Rights
Options
lapsed /
forfeited
Options /
Rights
Issued /
(exercised)
Number of Options / Rights
at end of the year
On issue
Vested
07/05/2020 30/06/2022 30/06/2022
$0.00
126,564
–
(126,564)
–
Rights - Tranche 4
24/11/2020 30/06/2023 30/06/2023
$0.00
762,080
(51,739)
Rights - Tranche 5
11/10/2021
30/06/2024 30/06/2024
$0.00
202,435
–
11/10/2021
30/06/2024 30/06/2024
$0.00
1,367,993
(409,370)
–
–
–
710,341
202,435
958,623
Rights - Tranche 6
04/11/2022 30/06/2025 01/10/2025
04/10/2022 30/06/2025 01/10/2025
$0.00
$0.00
–
–
–
385,233
385,233
(592,038)
2,774,352
2,182,314
Total
2,459,072
(1,053,147)
3,033,021
4,438,946
–
–
–
–
–
–
–
Weighted average remaining contractual life of share-based payments
The weighted average remaining contractual life for the share-based payments outstanding as at 30 June 2023 is 1.69 years
(2022: 1.68 years).
Range of exercise price of share-based payments
The range of exercise price for share-based payments outstanding at the end of the year is $0.00 (2022: $0.00).
Weighted average fair value of share-based payments
The weighted average fair value of share-based payments granted during the year was $0.62 (2022: $1.43).
92
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. SHARE-BASED PAYMENTS (CONTINUED)
(d) Performance rights (Rights) (continued)
Valuation of share-based payments
The fair value of the equity-settled share-based payments granted under the ESOP is estimated at the date of grant using
either a Black & Scholes or a Monte Carlo model, which takes into account factors including the exercise price, the volatility
of the underlying share price, the risk-free interest rate, the market price of the underlying share at grant date, historical and
expected dividends and the expected life of the option or right, and the probability of fulfilling the required hurdles.
–
–
–
–
Tranche 3 Options vest subject to performance hurdles, measured for the period 1 July 2019 to 30 June 2022
Tranche 4 Rights vest subject to performance hurdles, measured for the period 1 July 2020 to 30 June 2023
Tranche 5 Rights vest subject to performance hurdles, measured for the period 1 July 2021 to 30 June 2024
Tranche 6 Rights vest subject to performance hurdles, measured for the period 1 July 2022 to 30 June 2025
The following table gives the assumptions made in determining the fair value of the rights granted in Tranche 6.
Grant date
04/10/2022 04/10/2022 04/10/2022 04/10/2022
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options (years)
Options exercise price ($)
Share price at grant date ($)
Fair value at grant date ($)
RTSR
54%
2.97%
2.75
$0.00
$0.86
$0.57
ATSR
54%
2.97%
2.75
$0.00
$0.86
$0.36
AEPS
54%
2.97%
2.75
$0.00
$0.86
$0.86
Ore
Reserve
Growth
54%
2.97%
2.75
$0.00
$0.86
$0.86
The effects of early exercise have been incorporated into the calculations by using an expected life for the option that
is shorter than the contractual life based on historical exercise behaviour, which is not necessarily indicative of exercise
patterns that may occur in the future. The expected volatility was determined using a historical sample of the Company’s
share price over a three-year period. The resulting expected volatility therefore reflects the assumptions that the historical
volatility is indicative of future trends, which may also not necessarily be the actual outcome.
29. COMMITMENTS
(a) Capital commitments
At 30 June 2023, the Group has capital commitments that relate principally to the purchase and maintenance of plant and
equipment for its mining operations.
Capital expenditure commitments
- Within one year
2023
2022
26,168,651
17,715,233
Westgold Resources Limited Annual Report 2023
93
FINANCIAL REPORT
for the year ended 30 June 2023
29. COMMITMENTS (CONTINUED)
(b) Mineral tenement lease commitments
The Company has commercial leases over the tenements in which the mining operations are located. These tenement
leases have a life of between six months and twenty-one years. In order to maintain current rights to explore and mine the
tenements, the Group is required to perform minimum exploration work to meet the expenditure requirements specified by
the relevant state governing body. There are no restrictions placed on the lessee by entering into these contracts.
Mineral tenement leases:
- Within one year
- After one year but not more than five years
- After more than five years
2023
2022
4,570,018
4,395,253
17,816,763
17,132,795
24,435,509
23,423,341
46,822,290
44,951,389
(c) Other commitments
The Group has obligations for various expenditures such as royalties, production-based payments and exploration
expenditure. Such expenditures are predominantly related to the earning of revenue in the ordinary course of business.
Royalties paid under contractual arrangements
30. CONTINGENT ASSETS AND LIABILITIES
2023
2022
23,082,403
23,537,397
(i) Bank guarantees and rental deposits
The Group has a number of bank guarantees and rental deposits in favour of various government authorities and service
providers. These primarily relate to office leases and environmental and rehabilitation bonds at the various projects.
The total amount of these guarantees at the reporting date is $4,149,443 (2022: $1,930,033). The bank guarantees are
fully secured by term deposits (refer to Note 14).
31. AUDITOR’S REMUNERATION
Amounts received or due and receivable by Ernst & Young (Australia) for:
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities
283,665
282,825
2023
2022
Fees for other assurance and agreed upon procedures services and other legislation or
contractual arrangements where there is discretion as to whether the service is provided by
the auditor or another firm.
Fees for other services:
- Tax compliance and others
Total auditor’s remuneration
8,320
–
67,854
2,200
359,839
285,025
94
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
32. OPERATING SEGMENTS
For management purposes, the Group is organised into operating segments determined by the location of the mineral being
mined or explored, as these are the sources of the Group’s major risks and have the most effect on rates of return.
Reportable segments
The Group comprises the following reportable segments
Reference
Segment
Nature
FGO
Bryah Operations
Mining, treatment, exploration and development of gold assets
MGO & CGO Murchison Operations
Mining, treatment, exploration and development of gold assets
Other
Other
Exploration and development of other mineral assets
General
Executive management monitors the operating results of its operating segments separately for the purpose of making
decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating
profit or loss and is measured consistently with operating profit or loss in the consolidated financial statements. However,
certain income and expenses (see below) are managed on a consolidated basis and are not allocated to operating
segments. All other adjustments and eliminations are part of the detailed reconciliations presented further below.
Unallocated income and costs
Finance income and fair value gains and losses on financial assets are not allocated to individual segments as the underlying
instruments are managed on a Group basis.
Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are
also managed on a Group basis. Corporate charges comprise non-segmental expenses such as head office expenses
and interest costs. Corporate charges are not allocated to operating segments. Refer to reconciliation segment results to
consolidated results.
Westgold Resources Limited Annual Report 2023
95
FINANCIAL REPORT
for the year ended 30 June 2023
32. OPERATING SEGMENTS (CONTINUED)
Other disclosures
Capital expenditure consists of additions of property, plant and equipment, mine properties and development and
exploration and evaluation expenditure including assets from the acquisition of subsidiaries.
The following table presents revenue and profit information for reportable segments for the years ended 30 June 2023 and
30 June 2022.
Murchison
Bryah
Other
Total
Year ended 30 June 2023
External revenue
Sale of gold at spot
Sale of gold under forward contracts
Total segment revenue
Results
257,000,212
68,212,231
260,503,193
68,654,073
517,503,405
136,866,304
–
–
–
325,212,443
329,157,266
654,371,234
Depreciation and amortisation
(127,427,674)
(25,457,077)
(927,626)
(153,812,377)
Exploration and evaluation expenditure written off
–
–
–
–
Segment profit/(loss) before impairment
14,951,974
7,820,360
(2,457,285)
20,315,049
Total assets
Total liabilities
Capital expenditure
Year ended 30 June 2022
External revenue
Sale of gold at spot
Sale of gold under forward contracts
Total segment revenue
Results
531,858,864
78,496,658
98,285
610,453,807
(136,040,060)
(34,087,935)
(119,132,722)
(28,214,635)
247,763,992
88,966,408
241,594,540
69,251,678
489,358,532
158,218,086
–
–
–
–
–
(170,127,995)
(147,347,357)
336,730,400
310,846,218
647,576,618
Depreciation and amortisation
(143,564,220)
(48,725,750)
(890,699)
(193,180,669)
Exploration and evaluation expenditure written off
(89,016)
(21,149)
–
(110,165)
Segment profit/(loss) before impairment
9,462,740
17,702,894
(1,398,659)
25,766,975
Total assets
Total liabilities
Capital expenditure
557,446,050
73,580,723
44,059
631,070,832
(167,705,275)
(35,871,982)
(42,705)
(203,619,962)
(201,562,547)
(37,456,499)
–
(239,019,046)
96
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
32. OPERATING SEGMENTS (CONTINUED)
(a) Reconciliation of profit/(loss)
Segment profit/(loss)
Corporate administration expenses
Corporate interest income
Corporate other income
Net gain/(loss) on fair value changes of financial assets
Net gain/(loss) on sale of financial assets at FVTPL
Net gain/(loss) on disposal of assets
Impairment of mine properties and property plant and equipment
2023
2022
20,315,049
25,766,975
(17,369,902)
(12,967,460)
3,447,526
266,150
3,295,285
3,080,833
4,435
(2,014,040)
(190,939)
–
4,448,016
1,316,434
–
(175,535,410)
Total consolidated profit (loss)/from continuing operations before income tax
13,949,470
(160,086,518)
(b) Reconciliation of assets
Segment operating assets
Unallocated corporate assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Other financial assets
Financial assets (equity investments)
Property, plant and equipment
Right-of-use assets
Total consolidated assets
(c) Reconciliation of liabilities
Segment operating liabilities
Unallocated corporate liabilities
Trade and other payables
Provision for employee benefits
Interest-bearing loans and borrowings
Deferred tax liability
Total consolidated liabilities
(d) Segment revenue from external customers
Segment revenue
Total revenue
610,453,807
631,070,832
175,101,708
181,738,509
548,612
458,822
953,768
912,144
3,545,584
1,326,174
8,157,712
6,799,309
11,540,680
1,374,246
2,949,966
3,494,538
813,251,837
827,174,574
170,127,995
203,619,962
8,907,103
4,045,805
2,354,042
2,482,343
3,413,026
3,565,290
30,110,371
25,693,717
214,912,537
239,407,117
654,371,234
647,576,618
654,371,234
647,576,618
Westgold Resources Limited Annual Report 2023
97
FINANCIAL REPORT
for the year ended 30 June 2023
32. OPERATING SEGMENTS (CONTINUED)
(d) Segment revenue from external customers (continued)
Revenue from external customers by geographical locations is detailed below. Revenue is attributable to geographical
location based on the location of the customers. The Company does not have external revenues from external customers
that are attributable to any foreign country other than as shown.
Australia
Total revenue
2023
2022
654,371,234 647,576,618
654,371,234 647,576,618
The Group has two customers to which it sells gold and each account for 50% and 50% of this external revenue respectively
(2022: 52% and 48%).
(e) Segment non-current assets are all located in Australia.
33. KEY MANAGEMENT PERSONNEL
(a) Details of Key Management Personnel
Appointed
Resigned
(i) Non-Executive Directors (NEDs)
Hon. CL Edwardes AM
Non-Executive Chair
FJ Van Maanen
Non-Executive Director
GR Davison
JL Matthys
DN Kelly
Non-Executive Director
Non-Executive Director
Non-Executive Director
PB Schwann1
Non-Executive Director
(ii) Managing Director
28/03/2022
06/10/2016
01/06/2021
28/03/2022
05/11/2022
02/02/2017
WC Bramwell
Managing Director
24/05/2022
(iii) Other Executives (KMPs)
–
–
–
–
–
26/07/2022
–
–
–
SH Heng
PW Wilding
L Smith2
Chief Financial Officer
Chief Operating Officer
02/08/2021
11/10/2022
Company Secretary & General Counsel
20/12/2019
02/11/2022
1.
2.
PB Schwann resigned as an Independent Non-Executive Director on 26 July 2022.
L Smith resigned as Company Secretary and General Counsel on 02 November 2022.
There are no other changes of the key management personnel after the reporting date and before the date the financial
report was authorised for issue.
98
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
33. KEY MANAGEMENT PERSONNEL (CONTINUED)
(b) Compensation of Key Management Personnel
Short term benefits
Other fees
Termination payments
Post-employment benefits
Other long-term benefits
Share-based payments
2023
2022
2,522,951
2,664,040
–
14,373
171,500
728,876
167,279
208,138
201,831
40,498
218,292
(130,843)
3,281,853
3,525,082
(c) Loans to Key Management Personnel
There were no loans to key management personnel during the current or previous financial year.
(d) Interest held by Key Management Personnel under the Long-Term Incentive Plan
Performance Rights held by key management personnel under the long-term incentive plan to purchase ordinary shares:
Grant date
Expiry date
Exercise price $
2023
2022
11/10/2021
04/10/2022
Total
30/06/2024
01/10/2025
34. RELATED PARTY DISCLOSURES
0.00
0.00
405,986
501,470
971,653
–
1,377,639
667,541
(a) Subsidiaries
The consolidated financial statements of the Group include Westgold Resources Limited and the subsidiaries listed in the
following table:
Name
Aragon Resources Pty Ltd
Big Bell Gold Operations Pty Ltd
Westgold Mining Services Pty Ltd
Country of
incorporation
Australia
Australia
Australia
Ownership interest
2023
100%
100%
100%
2022
100%
100%
100%
(b) Ultimate parent
Westgold Resources Limited is the ultimate parent entity.
(c) Key management personnel
Details relating to key management personnel, including remuneration paid, are included in Note 33.
Westgold Resources Limited Annual Report 2023
99
FINANCIAL REPORT
for the year ended 30 June 2023
34. RELATED PARTY DISCLOSURES (CONTINUED)
(d) Transactions with related parties
Services provided by Westgold Resources Limited to Castile Resources Ltd
Amount owing by Castile Resources Ltd at 30 June
INFORMATION RELATING TO WESTGOLD RESOURCES LIMITED (THE PARENT ENTITY)
2023
–
–
2022
4,967
490
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Retained earnings/(accumulated losses)
Share-based payments reserve
Other reserves
Total Equity
Profit/(loss) of the parent entity
Total comprehensive profit of the parent entity
2023
2022
180,149,671
184,435,649
445,506,661
462,571,498
11,748,033
6,680,412
14,674,169
10,093,436
462,997,479
463,468,149
(52,645,728)
(31,431,802)
16,923,957
15,884,932
4,556,783
4,556,783
431,832,491
452,478,062
(21,213,926)
(11,379,797)
(21,213,926)
(11,379,797)
35. GUARANTEES ENTERED INTO BY THE PARENT ENTITY IN RELATION TO THE DEBTS OF
ITS SUBSIDIARIES.
Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785, Westgold and its wholly owned
subsidiaries entered into a deed of cross guarantee on 28 November 2016 (the Guarantee). The effect of the Guarantee is
that Westgold has guaranteed to pay any deficiency in the event of winding up of any controlled entity which is a party to
the Guarantee or if they do not meet their obligations under the terms of any debt subject to the Guarantee. The controlled
entities which are parties to the Guarantee have given a similar guarantee in the event that Westgold is wound up or if it
does not meet its obligations under the terms of any debt subject to the Guarantee.
The Consolidated Statement of Financial Position and Consolidated Statement of Comprehensive Income for the closed
group is not different to the Group’s Statement of Financial Position and Statement of Comprehensive Income.
Other contingent liabilities of the parent entity
Contractual commitments by the parent entity for the acquisition of property, plant or equipment
Nil
Nil
100
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
36. EVENTS AFTER THE BALANCE SHEET DATE
There have been no other significant events after the balance date.
37. ACCOUNTING STANDARDS
New and amended standards and interpretations
The Group has adopted all Accounting Standards and Interpretations effective from 1 July 2022. The accounting policies
adopted are consistent with those of the previous financial year. Several new and amended Accounting Standards and
Interpretations applied for the first time from 1 July 2022 but did not have a material impact on the consolidated financial
statements of the Group and, hence, have not been disclosed.
The standards and interpretations that have been issued or amended but not yet effective have not been early adopted by
the Group for the annual reporting period ended 30 June 2023.
The following Accounting Standards issued but not yet effective, have been assessed with no significant impact to
the Group.
– AASB 2021-5 Amendments to AASs – Deferred Tax related to Assets and Liabilities arising from a Single Transaction
– AASB 17 Insurance Contracts
– AASB 2021-2 Amendments to AASB 108 – Definition of Accounting Estimates
– AASB 2020-1 Amendments to AASs – Classification of Liabilities as Current or Non-current
Westgold Resources Limited Annual Report 2023
101
DIRECTORS’ DECLARATION
In accordance with a resolution of the Directors of Westgold Resources Limited, I state that:
In the opinion of the Directors:
(a) the financial statements and notes of the Company and of the Group are in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the Company’s and the Group’s financial position as at 30 June 2023 and of their
performance for the year ended on that date; and
(ii) complying with the Australian Accounting Standards (including the Australian Accounting Interpretations) and
Corporations Regulations 2001; and
(b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in
Note 2(b) and;
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable; and
(d) 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.
As at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group will be
able to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee
identified in Note 35.
On behalf of the Board.
Hon. Cheryl L Edwardes AM
Non-Executive Chair
Perth, 23 August 2023
102
Westgold Resources Limited Annual Report 2023
for the year ended 30 June 2023FINANCIAL REPORT DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor’s report to the members of
Westgold Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Westgold Resources Limited (the Company) and its
subsidiaries (collectively the Group), which comprises the consolidated statement of financial position
as at 30 June 2023, the consolidated statement of comprehensive income, consolidated statement of
changes in equity and consolidated statement of cash flows for the year then ended, notes to the
financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
and of its consolidated financial performance for the year ended on that date; and
b.
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit
addressed the matter is provided in that context.
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Liability limited by a scheme approved under Professional Standards Legislation
Westgold Resources Limited Annual Report 2023
103
FINANCIAL REPORT INDEPENDENT AUDITOR’S REPORT
FINANCIAL REPORT
INDEPENDENT AUDITOR’S REPORT
continued
2
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
1. Impairment assessment of non-current assets
Why significant
How our audit addressed the key audit matter
At 30 June 2023, the Group had non-current assets
of $405,001,236 comprising property, plant and
equipment, capitalised mine properties and
development expenditure and right of use assets
(refer to Notes 16,17 and 19 of the financial report).
At the end of the reporting period, the Group
exercises judgment and estimation in performing their
impairment assessment
The Group assessed whether the recoverable value
exceeds the carrying value as at 30 June 2023 of its
Murchison CGO, Murchison MGO and Bryah FGO cash
generating units (CGUs) and concluded that no
impairment was required for any of these CGUs.
We considered this to be a key audit matter because
of the significant judgment and estimates involved in
the determination of the recoverable amount of the
CGUs, including assumptions relating to future gold
prices, foreign exchange, operating and capital costs,
the discount rate used to reflect the risks associated
with the forecast cash flows having regard to the
current status of the CGUs, and the reserves and
resources included in the life of mine plans.
Our audit procedures on the impairment assessment
made by the Group included the following:
► Ensured the Group's impairment
methodology was in accordance with the
requirements of Australian Accounting
Standards.
► Evaluated the assumptions and
methodologies used by the Group, in
particular, those relating to forecast cash
flows including inputs used to formulate
them, and the resource valuation multiples
used. This included assessing, with
involvement from our valuation specialists,
where appropriate, the gold prices with
reference to market prices (where available),
market research, market practice, market
indices, foreign exchange rates, broker
consensus, historical performance, discount
rates and resource valuation multiples.
► Tested the mathematical accuracy of the
Group's discounted cash flow impairment
models and agreed relevant data, including
assumptions on timing and future capital and
operating expenditure, to the Group's
feasibility analysis of the CGUs and the latest
Board approved life of mine plans (as
appropriate).
► Assessed the work of the Group's internal
experts with respect to the capital and
operating assumptions used in the cash flow
forecasts. We also considered the
competence, qualifications and objectivity of
the experts and assessed whether key capital
and operating expenditure assumptions were
consistent with information in Board reports
and releases to the market.
► Assessed the work of the Group's experts
with respect to the reserve and resource
assumptions used in the cash flow forecasts.
This included understanding the estimation
process. We also examined the competence,
qualifications and objectivity of the Group's
experts, and assessed whether key economic
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Westgold Resources Limited Annual Report 2023
3
Why significant
How our audit addressed the key audit matter
assumptions were consistent with those used
elsewhere in the financial report.
► Assessed the impact of a range of
sensitivities to the economic assumptions
underpinning the Group's impairment
assessment.
► Evaluated the adequacy of the Group's
disclosures in the financial report relating to
impairment.
2. Rehabilitation and restoration provisions
Why significant
How our audit addressed the key audit matter
As a consequence of its operations, the Group incurs
obligations to restore and rehabilitate the
environment at its mine sites. Rehabilitation activities
are governed by local legislative requirements. As at
30 June 2023 the Group’s consolidated statement of
financial position includes provisions of $62.6m in
respect of such obligations (refer to Note 22 of the
financial report).
Estimating the costs associated with these future
activities requires considerable judgment in relation
to factors such as timing of the rehabilitation, the
costs associated with the rehabilitation activities and
economic assumptions such as discount rates and
inflation rates.
Accordingly, this was considered to be a key audit
matter.
We evaluated the assumptions and methodologies
used by the Group in determining their rehabilitation
obligations. Our audit procedures included the
following:
► Assessed the qualifications, competence and
objectivity of the Group’s internal experts, the
work of whom, formed the basis of the Group’s
rehabilitation cost estimates.
► With the assistance of our subject matter
specialists, we assessed the appropriateness of
the rehabilitation cost estimates.
► Tested the mathematical accuracy of the
rehabilitation models and assessed the
appropriateness of the assumed timing of
cashflows, inflation and discount rate
assumptions.
► Assessed the adequacy of the Group's
disclosures in the financial report relating to
rehabilitation obligations.
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 20X1 annual report other than the financial report and our
auditor’s report thereon. We obtained the corporate directory, the directors’ report and the letter
from the chair that are to be included in the annual report, prior to the date of this auditor’s report,
and we expect to obtain the remaining sections of the annual report after the date of this auditor’s
report.
Our opinion on the financial report does not cover the other information and we do not and will not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report
and our related assurance opinion.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Westgold Resources Limited Annual Report 2023
105
FINANCIAL REPORT
INDEPENDENT AUDITOR’S REPORT
continued
4
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 on the other information obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
► Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
► Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
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Westgold Resources Limited Annual Report 2023
5
► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
► Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in directors’ report for the year ended 30 June
2023.
In our opinion, the Remuneration Report of Westgold Resources Limited for the year ended 30 June
2023 complies with section 300A of the Corporations Act 2001.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Westgold Resources Limited Annual Report 2023
107
FINANCIAL REPORT
INDEPENDENT AUDITOR’S REPORT
continued
6
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Ernst & Young
T S Hammond
Partner
Perth
23 August 2023
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
108
Westgold Resources Limited Annual Report 2023
SHAREHOLDER INFORMATION
as at 12 September 2023
(A) TOP 20 SHAREHOLDERS
Name
1 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
2 CITICORP NOMINEES PTY LIMITED
3
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
4 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
5 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSI EDA
6 BNP PARIBAS NOMS PTY LTD
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