ANNUAL 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 ) Z O ( N O I T C U D O R P D L O G 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 ) Z O / $ ( T S O C G N N A T S U S N I - L L A I I 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 T A R Y C N E U Q E R F Y R U J N I G N I L L O R H T N O M 2 1 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 $3,340/oz. 148 ) z o k ( 135 I I G N N A M E R S T C A R T N O C D R A W R O F 122 109 96 83 70 60 50 40 30 20 10 Jun 22 Jul 22 Aug 22 Sep 22 Oct 22 Nov 22 Dec 22 Jan 23 Feb 23 Mar 23 Apr 23 May 23 Jun 23 Jul 23 Figure 8 - Westgold reduced its remaining forward contracts to 10koz in FY23 13 Westgold Resources Limited Annual Report 2023 OUR OPERATIONS REVIEW OF OPERATIONS (CONTINUED) BRYAH OPERATIONS The Bryah Operations are centred upon the Fortnum processing hub and incorporate the Fortnum, Horseshoe and Peak Hill mining areas (see Figure 9). With production from Fortnum averaging approximately 50koz per year, the hub remains a key contributor to Westgold’s total production. Figure 9 - Bryah assets FY23 BRYAH PRODUCTION AND A$ COSTS ) Z O ( N O I T C U D O R P D L O G 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 ) Z O / $ ( T S O C G N N A T S U S N I - L L A I I 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 – – – – – 7 3 4 3 8 3 0 . d% e t a l e r e c n a m r o f r e P l a t o T s t h g R i e c n a m r o f r e P e v a e l e c i v r e s l a u n n A g n o L d n a - r e p u S n o i t a u n n a 5 t n e m y a P n o i t a n m r e T i s e e F r e h t O - n o N s t i f e n e b y r a t e n o m e v a e l l a u n n A t i f e n e b h s a C s u n o b s e e f d n a y r a l a S e v i t u c e x e - n o N s r o t c e r i D 3 2 0 2 d e s a b - e r a h S 6 t n e m y a p m r e t g n o L s t i f e n e b - t s o P t n e m y o l p m e r e h t O m r e t t r o h S ) D E U N I T N O C ( S T N E M E G N A R R A T N E M Y O L P M E E V I T U C E X E . 7 5 7 3 , 3 9 1 , 5 7 9 4 0 1 , 5 7 9 4 0 1 , 5 7 9 4 0 1 8 0 4 , 8 6 8 0 7 6 7 5 , – – – – – – – – – – – – 5 7 3 , 8 1 5 7 9 9 , 5 7 9 9 , 5 7 9 9 , 0 0 5 , 6 0 0 8 , 4 5 8 9 6 , 2 3 0 , 1 3 1 0 , 1 7 1 8 2 7 5 5 , 0 5 1 , 2 3 1 6 0 0 1 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r a h s r i e h t s t i e f r o f e e y o p m e n a e r e h w s n o i t a u t i s n l I . s d r a d n a t s g n i t n u o c c a e h t r e d n u d e s n e p x e s e c n a l a b e h t s t n e s e r p e r n o i t a r e n u m e r t n e m y a p d e s a b - e r a h S o t e v i t a e r l , s l a s r e v e r e s e h t s t n e s e r p e r e b a t s i h t n l i n o i t a r e n u m e r e v i t a g e n , e r o f e r e h T . s s o l r o t i f o r p n i d e s r e v e r e r a s t n u o m a d e s n e p x e y i l s u o v e r p , s n o i t i d n o c e c i v r e s t e e m o t e r u l i a f o t e u d . s t n u o m a d e s n e p x e y i l s u o v e r p ’ l s e e y o p m e e h t . n o i t a n g i s e r n o e d a m e r e w s t n e m y a p n o i t a n m r e t y r a n o i t e r c s i d i l a n o i t i d d A ’ l n o i t c e e s e e y o p m e e h t l t a y r a l i a s s a t u o d a p s a w m u m x a m e h t i f o s s e c x e n i r e p u s d e m e e d f o t n u o m a e h t , e s a b n o i t u b i r t n o c r e p u s i m u m x a m e h t d e h c a e r e v a h s e e y o p m e e r e h W l . 2 2 0 2 r e b m e v o N 2 0 n o d e n g i s e r h t i m S L . 2 2 0 2 r e b o t c O 1 1 n o r e c i f f O g n i t a r e p O i i f e h C d e t n o p p a s a w g n d W W P l i i . 2 2 0 2 r e b m e v o N 5 n o d e t n o p p a s a w y i l l e K N D . 1 . 2 . 3 . 4 . 5 . 6 42 Westgold Resources Limited Annual Report 2023 for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) – – – – – – – – – 7 2 8 1 8 2 7 2 – – . d e s a b - e r a h S 9 s t n e m y a p m r e t g n o L s t i f e n e b - t s o P t n e m y o l p m e r e h t O m r e t t r o h S d% e t a l e r e c n a m r o f r e P l a t o T s t h g R i e c n a m r o f r e P e v a e l e c i v r e s l a u n n A g n o L d n a - r e p u S n o i t a u n n a 8 t n e m y a P n o i t a n m r e T i s e e F r e h t O - n o N s t i f e n e b y r a t e n o m e v a e l l a u n n A t i f e n e b h s a C s u n o b s e e f d n a y r a l a S e v i t u c e x e - n o N s r o t c e r i D 2 2 0 2 0 1 2 0 5 , 1 9 7 4 2 , 0 5 7 2 1 1 , 7 1 4 6 1 1 , 0 4 5 6 2 , – – – – 1 1 5 6 , ) 4 8 4 5 6 ( , ) 4 5 7 8 9 1 ( , 1 2 5 2 1 1 , – 5 4 7 7 7 3 , ) 3 4 2 , 2 9 1 ( – – – – – – – – 2 1 5 , 1 5 6 5 4 , 0 5 2 0 1 , 3 8 5 0 1 , 3 1 4 2 , 7 6 6 , 1 1 9 2 2 0 1 , 9 1 2 , 1 5 – – – – – – – – , 5 1 6 0 0 6 8 6 1 , 2 6 8 2 9 3 2 , 9 9 8 7 3 , 6 0 9 5 8 2 , – – 3 3 8 4 , , 2 6 2 0 3 2 7 4 7 , 1 7 1 8 9 7 , , 5 2 8 2 0 4 4 9 2 8 3 , 2 2 3 2 6 , , 6 1 8 2 6 4 5 9 1 , 1 6 5 9 7 7 9 , 1 1 7 9 8 , ) 1 7 3 4 7 ( , 7 5 2 , 2 5 6 ) 2 6 1 , 2 7 ( 8 3 0 , 1 2 2 8 6 , 2 7 8 7 3 8 7 , – – 9 5 3 4 , 0 0 5 7 2 , 7 7 7 3 , 2 9 4 7 2 , 9 2 5 5 2 , 0 3 5 5 2 , , 4 8 6 9 9 0 3 , , 0 3 4 7 7 4 3 , 0 0 4 , 1 6 7 9 4 0 4 , , 9 1 9 6 5 1 ) 3 4 8 0 3 1 ( , 7 9 4 0 4 , 8 3 1 , 8 0 2 – – – – 2 4 0 5 9 1 , , 3 7 5 3 0 3 , 7 7 8 8 2 7 , 7 7 8 8 2 7 – – – – – – – – – – – – – – – – - – – – – 9 4 6 , 1 – 7 3 9 4 , 6 8 5 6 , 0 7 7 2 , 8 7 4 2 , 3 1 5 2 3 9 4 , – 5 1 4 7 , 5 1 4 7 , 5 1 4 7 , – – – – – – – – – – – – – – – – 6 4 6 5 4 , 1 M A s e d r a w d E L C . n o H 9 1 1 , 5 1 0 0 5 2 0 1 , 3 3 8 5 0 1 , 7 2 1 , 4 2 7 6 6 6 1 1 , 2 9 2 , 2 0 1 4 8 1 , 2 1 5 2 l l e w m a r B C W n e n a a M n a V J F n o s i v a D R G 1 s y h t t a M L J 4 k o o C G P n n a w h c S B P r o t c e r i D e v i t u c e x E 2 0 3 , 1 2 8 4 5 7 7 , 0 0 0 5 7 3 , 2 l l e w m a r B C W – – 3 3 3 8 4 , 4 k o o C G P 8 3 9 2 3 , 4 2 5 9 3 , 2 8 6 9 5 , 2 8 6 9 5 , – – 5 0 2 , 3 0 8 3 5 1 , 2 9 6 2 , 2 0 1 , 7 1 2 6 0 , 1 1 7 9 8 4 3 , 3 3 4 7 , 9 6 7 7 3 , 9 8 5 3 4 , 0 0 0 5 7 2 , 3 6 0 5 3 , 6 9 1 , 8 7 2 – – 0 8 5 7 0 4 , , 1 0 9 7 8 3 3 0 0 6 6 1 , 8 6 3 , 3 5 8 , 1 3 0 0 6 6 1 , , 2 5 5 5 6 3 2 , s e v i t u c e x E r o n e S i 5 l l e w m a r B C W g n e H H S 7 , 3 i m a h g n k c u B A 7 , 3 n o t r a l l u F A D h t i m S L s l a t o T i l i 6 g n d W W P s t n e m u r t s n i t n e m y a p d e s a b - e r a h s r i e h t s t i e f r o f e e y o p m e n a e r e h w s n o i t a u t i s n l I . s d r a d n a t s g n i t n u o c c a e h t r e d n u d e s n e p x e s e c n a l a b e h t s t n e s e r p e r n o i t a r e n u m e r t n e m y a p d e s a b - e r a h S o t e v i t a e r l , s l a s r e v e r e s e h t s t n e s e r p e r e b a t s i h t n l i n o i t a r e n u m e r e v i t a g e n , e r o f e r e h T . s s o l r o t i f o r p n i d e s r e v e r e r a s t n u o m a d e s n e p x e y i l s u o v e r p , s n o i t i d n o c e c i v r e s t e e m o t e r u l i a f o t e u d . e t a d n o i t a n m r e t i t a s e c n a l a b e v a e l e c i v r e s g n o l d n a e v a e l l a u n n a d e u r c c a y n a s u p l , e v o b a 7 n o i t c e s n i d e s i r a m m u s s t n e m e g n a r r a e h t h t i w e n i l n i e d a m e r e w s t n e m y a p n o i t a n m r e T i . s t n u o m a d e s n e p x e y i l s u o v e r p ’ l s e e y o p m e e h t . 2 2 0 2 y a M 4 2 n o d e n g i s e r i m a h g n k c u B A d n a n o t r a l l u F A D ’ l n o i t c e e s e e y o p m e e h t l t a y r a l i a s s a t u o d a p s a w m u m x a m e h t i f o s s e c x e n i r e p u s d e m e e d f o t n u o m a e h t , e s a b n o i t u b i r t n o c r e p u s i m u m x a m e h t d e h c a e r e v a h s e e y o p m e e r e h W l . 2 2 0 2 h c r a M 8 2 n o n a m r i a h C e v i t u c e x E - n o N s a d n a 1 2 0 2 y u J 1 3 n o n a m l r i a h C e v i t u c e x E s a d e n g i s e r k o o C G P . ) r o t c e r i D e v i t u c e x e - n o n a f o n o i t i s o p e h t d e h y l i l s u o v e r p e h ( 2 2 0 2 y a M 3 2 n o d e n g i s e r d n a 1 2 0 2 t s u g u A 1 n o r o t c e r i D e v i t u c e x E o t d e t n o p p a s a w i l l e w m a r B C W . i 2 2 0 2 h c r a M 8 2 n o d e t n o p p a e r e w s y h t t a M L J d n a M A s e d r a w d E L C . n o H . 2 2 0 2 y a M 4 2 n o r o t c e r i i D g n g a n a M o t d e t n o p p a s a w i l l e w m a r B C W . 2 2 0 2 y a M 4 2 n o r e c i f f O g n i t a r e p O i i f e h C / A d e t n o p p a s a w g n d W W P l i i . 1 . 2 . 3 . 4 . 5 . 6 . 7 . 8 . 9 Westgold Resources Limited Annual Report 2023 43 / d e s p a L d e t i e f r o f d e t s e V e t a d y r i p x E e t a d g n i t s e V e t a d t n a r g t a e u l a v l a t o T e u l a v r i a F 2 t h g i r r e p e t a d t n a r G d e t n a r G 1 e h c n a r T e v i t u c e x E – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 8 2 5 0 6 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 9 2 1 , 8 4 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 9 3 5 0 9 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 9 3 5 0 9 $ 0 2 . 1 $ . 5 9 0 $ 9 7 . 1 $ 9 7 . 1 $ 1 2 0 2 / 0 1 / 1 1 9 0 6 0 5 , 1 2 0 2 / 0 1 / 1 1 9 0 6 0 5 , 1 2 0 2 / 0 1 / 1 1 9 0 6 0 5 , 1 2 0 2 / 0 1 / 1 1 9 0 6 0 5 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 6 0 1 , 6 6 $ 2 7 5 0 $ . 2 2 0 2 / 0 1 / 4 0 0 7 5 , 5 1 1 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 1 2 7 , 1 4 $ 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 , 2 1 8 8 9 $ 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 , 7 3 9 2 3 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 6 3 2 0 3 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 2 4 0 4 2 $ , 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 7 2 2 5 4 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 7 2 2 5 4 $ 1 6 3 0 $ . 5 5 8 0 $ . 5 5 8 0 $ . 0 2 . 1 $ . 5 9 0 $ 9 7 . 1 $ 9 7 . 1 $ 2 2 0 2 / 0 1 / 4 0 0 7 5 , 5 1 1 2 2 0 2 / 0 1 / 4 0 0 7 5 , 5 1 1 2 2 0 2 / 0 1 / 4 0 3 2 5 , 8 3 1 2 0 2 / 0 1 / 1 1 1 8 2 5 2 , 1 2 0 2 / 0 1 / 1 1 1 8 2 5 2 , 1 2 0 2 / 0 1 / 1 1 1 8 2 5 2 , 1 2 0 2 / 0 1 / 1 1 1 8 2 5 2 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 9 8 8 7 4 $ , 2 7 5 0 $ . 2 2 0 2 / 0 1 / 4 0 3 2 7 , 3 8 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 , 4 2 2 0 3 $ 1 6 3 0 $ . 2 2 0 2 / 0 1 / 4 0 3 2 7 , 3 8 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 3 8 5 , 1 7 $ 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 1 6 8 , 3 2 $ 5 5 8 0 $ . 5 5 8 0 $ . 2 2 0 2 / 0 1 / 4 0 3 2 7 , 3 8 2 2 0 2 / 0 1 / 4 0 6 0 9 7 2 , 5 5 5 5 6 6 6 6 5 5 5 5 6 6 6 6 l l e w m a r B C W g n e H H S d o i r e p e h t g n i r u d d e s p a l r o d e t s e v , d e t n a r g ) s t h g i R ( s t h g i R e c n a m r o f r e P d l o g t s e W : 1 e l b a T S E R U S O L C S I D Y R O T U T A T S L A N O I T I D D A . 8 44 Westgold Resources Limited Annual Report 2023 for the year ended 30 June 2023FINANCIAL REPORT REMUNERATION REPORT (AUDITED) / d e s p a L d e t i e f r o f 6 4 6 2 2 , 6 4 6 2 2 , 6 4 6 2 2 , 6 4 6 2 2 , – – – – – – – – 2 7 8 8 1 , 2 7 8 8 1 , 2 7 8 8 1 , 2 7 8 8 1 , 1 7 8 3 2 , 1 7 8 3 2 , 1 7 8 3 2 , 1 7 8 3 2 , 0 5 9 7 4 , 0 5 9 7 4 , 0 5 9 7 4 , 4 8 9 5 1 , d e t s e V e t a d y r i p x E e t a d g n i t s e V e t a d t n a r g t a e u l a v l a t o T e u l a v r i a F 2 t h g i r r e p e t a d t n a r G d e t n a r G 1 e h c n a r T e v i t u c e x E – – – – – – – – – – – – – – – – – – – – – – – – 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 7 0 6 3 3 $ , 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 8 9 3 8 2 $ , 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 , 4 7 0 9 4 $ 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 , 4 7 0 9 4 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 6 2 6 0 3 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 2 5 3 4 2 $ , 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 1 1 8 5 4 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 1 1 8 5 4 $ 8 4 . 1 $ 5 2 . 1 $ 7 1 . 2 $ 7 1 . 2 $ 0 2 . 1 $ . 5 9 0 $ 9 7 . 1 $ 9 7 . 1 $ 0 2 0 2 / 1 1 / 4 2 6 4 6 2 2 , 0 2 0 2 / 1 1 / 4 2 6 4 6 2 2 , 0 2 0 2 / 1 1 / 4 2 6 4 6 2 2 , 0 2 0 2 / 1 1 / 4 2 6 4 6 2 2 , 1 2 0 2 / 0 1 / 1 1 7 0 6 5 2 , 1 2 0 2 / 0 1 / 1 1 7 0 6 5 2 , 1 2 0 2 / 0 1 / 1 1 7 0 6 5 2 , 1 2 0 2 / 0 1 / 1 1 7 0 6 5 2 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 0 4 7 , 2 5 $ 2 7 5 0 $ . 2 2 0 2 / 0 1 / 4 0 4 0 2 , 2 9 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 5 8 2 , 3 3 $ 1 6 3 0 $ . 2 2 0 2 / 0 1 / 4 0 4 0 2 , 2 9 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 4 3 8 8 7 $ , 5 5 8 0 $ . 2 2 0 2 / 0 1 / 4 0 4 0 2 , 2 9 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 8 7 2 , 6 2 $ 5 5 8 0 $ . 2 2 0 2 / 0 1 / 4 0 3 3 7 0 3 , 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 6 0 0 8 2 $ , 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 5 6 6 3 2 $ , 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 , 5 9 8 0 4 $ 3 2 0 2 / 6 0 / 0 3 3 2 0 2 / 6 0 / 0 3 , 5 9 8 0 4 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 0 5 5 8 2 $ , 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 , 1 0 7 2 2 $ 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 5 0 7 2 4 $ , 4 2 0 2 / 6 0 / 0 3 4 2 0 2 / 6 0 / 0 3 5 0 7 2 4 $ , 8 4 . 1 $ 5 2 . 1 $ 7 1 . 2 $ 7 1 . 2 $ 0 2 . 1 $ . 5 9 0 $ 9 7 . 1 $ 9 7 . 1 $ 0 2 0 2 / 1 1 / 4 2 2 7 8 8 1 , 0 2 0 2 / 1 1 / 4 2 2 7 8 8 1 , 0 2 0 2 / 1 1 / 4 2 2 7 8 8 1 , 0 2 0 2 / 1 1 / 4 2 2 7 8 8 1 , 1 2 0 2 / 0 1 / 1 1 1 7 8 3 2 , 1 2 0 2 / 0 1 / 1 1 1 7 8 3 2 , 1 2 0 2 / 0 1 / 1 1 1 7 8 3 2 , 1 2 0 2 / 0 1 / 1 1 1 7 8 3 2 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 8 2 4 7 2 $ , 2 7 5 0 $ . 2 2 0 2 / 0 1 / 4 0 0 5 9 7 4 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 0 1 3 7 1 $ , 1 6 3 0 $ . 2 2 0 2 / 0 1 / 4 0 0 5 9 7 4 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 , 7 9 9 0 4 $ 5 5 8 0 $ . 2 2 0 2 / 0 1 / 4 0 0 5 9 7 4 , 5 2 0 2 / 0 1 / 1 0 5 2 0 2 / 6 0 / 0 3 6 6 6 , 3 1 $ 5 5 8 0 $ . 2 2 0 2 / 0 1 / 4 0 4 8 9 5 1 , 4 4 4 4 5 5 5 5 6 6 6 6 4 4 4 4 5 5 5 5 6 6 6 6 i l i g n d W W P h t i m S L s e t o N . 3 2 0 2 Y F n i d e t n a r g e r e w 6 e h c n a r T s t h g R d n a 2 2 0 2 Y F n i i d e t n a r g e r e w 5 e h c n a r T s t h g R i , 1 2 0 2 Y F n i d e t n a r g e r e w 4 e h c n a r T s t h g R i . t h g i r i l r e p e u a v r i a f e h t s e t a m x o r p p a s t h g i r e c n a m r o f r e p e h t f o e r u s o p x e m u m x a m e h T i . 1 . 2 l f o n o i t a u a v e h t n o s l i a t e d r o F . t n a r g e h t f o d o i r e p g n i t s e v e h t r e v o n o i t a s n e p m o c n i d e s i n g o c e r s i d o i r e p e h t g n i r u d d e t n a r g s t n e m y a p d e s a b - e r a h s e h t l f o e u a v e h T . 8 2 e t o N o t r e f e r e s a e p l , d e s u s n o i t p m u s s a d n a s l e d o m g n d u c n l i i , s n o i t p o e h t . l n o i t a n g i s e r n o y e t a d e m m e s p a i i l s ’ I T L y l l a r e n e 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. A member firm of Ernst & Young Global Limited 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 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation 104 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. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation 106 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 LTD7 NATIONAL NOMINEES LIMITED 8 MR COLIN PETROULAS 9 BNP PARIBAS NOMINEES PTY LTD 10 BNP PARIBAS NOMS PTY LTD 11 NEWECONOMY COM AU NOMINEES PTY LIMITED <900 ACCOUNT> 12 MORGAN STANLEY AUSTRALIA SECURITIES (NOMINEE) PTY LIMITED 13 SANDHURST TRUSTEES LTD 14 SANDHURST TRUSTEES LTD 15 TREASURY SERVICES GROUP PTY LTD 16 BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM 17 DEBORTOLI WINES PTY LIMITED 18 EVERBRIGHT SECURITIES INVESTMENT SERVICES (HK) LTD Units % Units 161,298,853 68,567,620 48,724,142 23,828,755 19,051,668 15,116,634 12,916,576 9,600,000 5,744,512 5,432,282 4,532,273 4,468,016 4,300,000 2,704,703 2,290,677 2,270,539 2,191,111 2,000,000 2,000,000 1,799,863 34.06 14.48 10.29 5.03 4.02 3.19 2.73 2.03 1.21 1.15 0.96 0.94 0.91 0.57 0.48 0.48 0.46 0.42 0.42 0.38 19 MR RICHARD FARLEIGH 20 UBS NOMINEES PTY LTD TOTAL (B) DISTRIBUTION OF FULLY PAID ORDINARY SHARES Range 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 Over TOTAL 398,838,224 84.21 Total holders Units % Units 2,793 1,427,709 3,162 8,205,127 1,040 7,931,915 1,220 32,819,396 0.30 1.73 1.67 6.93 117 423,238,583 89.36 8,332 473,622,730 100.00 (C) DISTRIBUTION OF PERFORMANCE RIGHTS EXPIRING 30 JUNE 2024 Range 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 Over TOTAL Total holders Units % Units – – – 8 7 – – – 378,346 836,530 15 1,214,876 – – – 31 69 100 Westgold Resources Limited Annual Report 2023 109 FINANCIAL REPORT SHAREHOLDER INFORMATION FINANCIAL REPORT SHAREHOLDER INFORMATION as at 12 September 2023 (D) DISTRIBUTION OF PERFORMANCE RIGHTS EXPIRING 1 OCTOBER 2025 Range (size of parcel) Total holders Units % Units 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 Over TOTAL – – – 8 10 18 – – – 528,702 2,123,111 2,651,813 – – – 20 80 100 (E) NUMBER OF HOLDERS WITH LESS THAN A MARKETABLE PARCEL OF ORDINARY SHARES Minimum $ 500.00 parcel at $ 1.7800 per unit (F) SUBSTANTIAL SHAREHOLDERS L1 Capital Pty Ltd Ruffer LLP Minimum Parcel Size Holders Units 281 716 91,055 Number of Shares % Date of Notice 53,099,838 11.21 28/08/2023 38,245,650 8.08 22/03/2022 (G) VOTING RIGHTS The voting rights for each class of security on issue are: Ordinary Fully Paid Shares – Each ordinary shareholder is entitled to one vote for each share held. Unquoted Performance Rights – The holders of performance rights have no rights to vote at a general meeting of the Company. (H) UNQUOTED PERFORMANCE RIGHTS ASX Code WGXAF WGXAG TOTAL Security Description Number of Securities Performance Rights Expiring 30 June 2024 1,214,876 Performance Rights Expiring 1 October 2025 2,651,813 3,866,689 110 Westgold Resources Limited Annual Report 2023 FINANCIAL REPORT SHAREHOLDER INFORMATION CORPORATE DIRECTORY DIRECTORS Hon. Cheryl L Edwardes AM (Non-Executive Chair) Wayne C Bramwell (Managing Director) Fiona J Van Maanen (Non-Executive Director) Gary R Davison (Non-Executive Director) Julius L Matthys (Non-Executive Director) David N Kelly (Non-Executive Director) COMPANY SECRETARY Susan Park (Company Secretary) SENIOR EXECUTIVES Su Hau Heng (Chief Financial Officer) Phillip Wilding (Chief Operating Officer) REGISTERED OFFICE Level 6, 200 St Georges Terrace Perth WA 6000 P: +61 8 9462 3400 E: reception@westgold.com.au W: www.westgold.com.au POSTAL ADDRESS PO Box 7068 Cloisters Square WA 6850 SECURITIES EXCHANGE Listed on the Australian Securities Exchange ASX CODE: WGX SHARE REGISTRY Computershare Investors Services Pty Ltd Level 17, 221 St Georges Terrace Perth WA 6000 P: +61 3 9415 4000 F: +61 3 6473 2500 W: www.computershare.com DOMICILE AND COUNTRY OF INCORPORATION Australia ABN ABN 60 009 260 306 Westgold Resources Limited Annual Report 2023 111 www.westgold.com.au