Yandal Resources Limited
Annual Report 2023

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ANNUAL R E POR T 2023 Contents Corporate Particulars ..................................................................................................................................................... 1 Chairmans Letter .............................................................................................................................................................. 2 Operations Report ............................................................................................................................................................ 3 Directors’ Report ............................................................................................................................................................ 13 Auditor’s Independence Declaration ................................................................................................................. 26 Independent Auditor’s Report ................................................................................................................................ 27 Directors’ Declaration ................................................................................................................................................. 31 Statement of Profit or Loss and Other Comprehensive Income ......................................................... 32 Statement of Financial Position ............................................................................................................................ 33 Statement of Changes in Equity ............................................................................................................................ 34 Statement of Cash Flows ........................................................................................................................................... 35 Notes to and Forming Part of the Financial Statements ........................................................................ 36 Shareholder Information ........................................................................................................................................... 58 Corporate Particulars DIRECTORS Mr Tim Kennedy Mr Greg Evans Ms Katina Law Managing Director Non-Executive Chairman Non-Executive Director COMPANY SECRETARY Mr Greg Fitzgerald PRINCIPAL PLACE OF BUSINESS 5/62 Ord Street West Perth WA 6005 Telephone +61 8 9389 9021 www.yandalresources.com.au REGISTERED OFFICE 5/62 Ord Street West Perth WA 6005 SHARE REGISTRY AUDITORS STOCK EXCHANGE LISTING Automic Level 5, 191 St Georges Terrace Perth WA 6000 HLB Mann Judd (WA Partnership) Level 4, 130 Stirling Street Perth WA 6000 Australian Securities Exchange Home Exchange: Perth Code: YRL Yandal Resources Limited Annual Report 2023 2 Chairmans Letter Dear fellow shareholders, As Chair of Yandal Resources Limited, I extend to you, our valued shareholders, warm greetings, and appreciation for your support of our gold exploration company. The year 2023 was clearly affected by market headwind which saw much investor interest captured by “battery” minerals and a lack of interest in the junior gold sector. History shows that sentiment nearly always turns back to gold, and we believe Yandal is extremely well positioned to benefit when this occurs. Through the efforts of our team the company at the time of writing has a growing resource inventory that totals circa 424,000oz all located on granted mining leases strategically adjacent to nearby mining operations. Most importantly the team has focussed on advancing prospects with the potential to make transformative new discoveries. With a resolute focus on laying the groundwork for growth, we persist in channelling our capital and resources towards the exploration of our most promising targets within the Yandal and Norseman-Wiluna greenstone belts. Simultaneously, we remain vigilant to identifying emerging prospects and new opportunities in the region. Recent times have seen us undertake measures aimed at renewing and retaining our invaluable personnel. We have instituted a rigorous cost management and budgeting strategy, conducted a comprehensive review of our Company's assets, and prioritised our drilling programs to ensure that every dollar spent adds value to your company. Our focus remains on our people and culture, fostering an environment that celebrates inclusivity, diversity, accountability, and safety and wellbeing in every activity we undertake. Our decision-making processes benefit from a blend of technical expertise, diligent investigation, diverse experiences, lessons learned, and innovative ideas. In tandem, our commitment to sustainability spurs us to continuously elevate our ESG policies, strategies, and overall impact. I would like to take this opportunity to commend and thank my colleagues on the Board for their invaluable contributions, with special recognition reserved for the stability, commitment, and expertise that Mr. Tim Kennedy our Managing Director and CEO, brings to his role. The Board is optimistic of the future and anticipates positive strides forward in the year ahead. In closing, allow me to reiterate our profound gratitude for your continued support and encouragement. It is your trust that propels us forward, guiding our efforts as we navigate the journey ahead. With a blend of strategic foresight, operational diligence, and unwavering commitment to shareholder interests, Yandal Resources Limited remains primed to create significant shareholder value from our quality portfolio through the efforts of our dedicated teams and stakeholders. Thank you and warm regards, Mr Greg Evans Chair 20 September 2023 Perth, WA Yandal Resources Limited Annual Report 2023 3 Operations Report INTRODUCTION The Company's primary focus is exploration, discovery, and development of gold projects within the north-eastern and eastern Goldfields of Western Australia. Our strategic objective is delineating valuable resources in locations with proven gold endowment, In the case of our project’s, endowment is confirmed by the proximity of multi-million ounce gold mines such as Jundee, Bronzewing, and Kanowna Belle. With a long mining history, the areas in which we are exploring have well established infrastructure, thereby facilitating rapid cost-effective development of future discoveries. All three projects are regarded as having strong potential for significant new discoveries. Figure 1- Regional map of the Company’s gold projects, greenstone belts, regional towns and significant resource projects Yandal Resources Limited Annual Report 2023 4 Operations Report INTRODUCTION continued In 2023, our field exploration efforts were concentrated on the Mt McClure and Ironstone-Well Barwidgee Projects. At Mt McClure most activity was directed towards establishing initial Mineral Resource Estimates (MRE’s) from drilling data beneath and marginal to the historic open pits. An initial MRE was also completed for the Gordons Dam prospect (Gordons Project). As of the time of writing, the Company's total gold MRE inventory across all three projects stood at 424,000 ounces. This figure is expected to rise further upon completion of the MRE for the HMS Sulphur prospect at Mt McClure, which is scheduled for early next year. Exploration efforts at Ironstone Well-Barwidgee were focused on refining and prioritising targets that will guide upcoming phases of drilling. This process has led us to emphasise the highly prospective Oblique, Quarter Moon, and New England Granite areas, all of which have demonstrated mineralisation and considerable large-scale potential. Ongoing exploration reviews and targeting enabled the Company to focus on areas of the highest potential to cost-effectively add value. On the latter point the company engaged highly regarded independent consultants with structural interpretation and targeting expertise to unlock new exploration opportunities within our tenements. This collaboration has led to the identification of exciting new exploration targets, which are currently being advanced. Our commitment to nurturing crucial, long-term relationships with key stakeholders, including Native Title holders, remains a priority. We express our sincere gratitude for their ongoing support. CORPORATE The Company maintained a high level of activity throughout the year spending a total of approximately $3.6m exploring its three exploration projects. Due to the tighter market conditions the Company was cognisant of the need to restrain expenditure and focus drilling on the very highest priority prospects. A very high proportion of the exploration spend was on drilling related activities which included approximately 5,000m of aircore drilling and 15,000m of RC drilling. To sustain these activities the Company executed a capital raise of $5m (before costs) via a strongly supported entitlement issue and placement launched in October 2022. Yandal’s cash position at 30 June 2023 was $4.2m. The Company retained a small but effective board of three Directors during the year. In February 2023, long-standing Company Secretary Bianca Taveira stepped down due to other commitments. Her role was assumed by Greg Fitzgerald, a highly accomplished executive with previous experience as Company Secretary for an ASX 200 gold company. In March 2023, the company recruited highly regarded gold geologist Chris Oorschot as Exploration Manager to provide a strong technical and strategic focus and reinvigorate the exploration effort. The Company moved premises from a shared office to a dedicated office space close to peer companies and service providers in West Perth. We commend our small but dedicated exploration team for their enthusiastic contribution to advancing our projects during the year. ENVIRONMENT, SUSTAINABILITY AND GOVERNANCE The Company ESG responsibilities are a key consideration when planning and conducting its activities whether in the corporate office or in the field. Our core responsibilities are outlined in our Corporate Governance Codes and Policies. The areas of particular focus are:    People: We aim to foster a working environment that is collaborative, enjoyable, and stimulating and where our employees can fully use their expertise and develop new skills to the benefit of the Company and their ongoing careers. Our people drive our ESG efforts, so we value and place high value on new initiatives in this regard. Safety: The health safety and wellbeing of our people including employees and contractors is of the utmost importance. We have well developed safety procedures and recognise that a safe work environment comes when a culture of safety is fostered amongst our people such that it becomes an inherent part of all we do. We are pleased to advise that there were no injuries incurred by our workforce during the period. Stakeholders: We value and respect all stakeholders in the regions where we work and recognise the unique long-term relationship Indigenous Stakeholders have with the land. We respect the traditional owners of the land on which we work and endeavour to build long-term mutually beneficial relationships with our Indigenous stakeholders. Operations Report ENVIRONMENT, SUSTAINABILITY AND GOVERNANCE continued  Environment: We have a dual focus when it comes to our environmental impact. Firstly, we strive to minimise the impact that our activities have in the areas in which we work. Secondly, we place high importance on our land rehabilitation obligations and aim to leave no long- term adverse environmental impact. Yandal Resources Limited Annual Report 2023 5 Figure 2 - Rehabilitation Activities at Gordons. Preparing a native seed mix (left) and spreading seeds at rehabilitation area (right). Operations Report IRONSTONE WELL-BARWIDGEE Yandal Resources Limited Annual Report 2023 6 The 100% owned Ironstone Well-Barwidgee Project covers approximately 374km2 of contiguous tenure, covering 53km of strike of highly prospective and under-explored greenstone between the Jundee and Bronzewing mines in the northern Yandal Greenstone Belt. The Yandal Belt has less than 2% outcrop and exploration is hampered by a thick weathering profile and widespread transported cover which masks the bedrock geochemistry. Within the project tenure less than 6% of historic drill holes are deeper than 100m and less than 30% are deeper than 50m and as a result much of the tenure has been poorly tested by past exploration efforts. The Company's identifying regions of involves overarching strategy significant geological and geophysical potential and then juxtaposing this information with historical exploration drilling data to pinpoint the most promising targets. These targets are then tested with effective drill programs for the presence of significant gold mineralisation. Yandal already has an established Resource of 268,000oz(1) of gold at Flushing Meadows and considers there to be strong potential to make new discoveries and expand this resource base within the extensive tenure holding. (1) YRL ASX announcement dated 4 November 2020 During the year, the company completed aircore and RC drill programs to refine and test several prospects. Encouraging aircore results were returned from Quarter Moon where intercepts including 6m @ 1.1g/t Au from 19m incl. 3m @ 1.9g/t Au (YRLAC1064) have extended the footprint of that prospect to over 1.5km of strike. RC drilling returned positive results from Sims Find, where an intercept of 3m @ 3.6g/t Au from 138m (YRLRC1045) was returned, approximately 2km NW along strike from the main zone of mineralisation. At Cash, located on the southern margin of the project immediately along strike from the Corboys Deposit (ASX: NST), RC drilling returned encouraging intercepts, including 3m @ 3.6g/t Au from 96m (YRLRC1036) and 3m @ 2.3g/t Au from 26m (YRLRC1016) and now indicate a mineralised horizon over 400m long. Figure 3 -Regional geology plan showing key prospects and tenure at the Ironstone Well- Barwidgee project The Company completed a high-resolution aeromagnetic survey over the area from Sim’s Find to New England Granite to better define these prospects. Data were merged with broader spaced historical data to produce seamless high-resolution coverage, which was used to refine geological models. At Sims Find where mineralisation is interpreted to be associated with demagnetised zones, 3D inversion modelling was completed on the merged data to assist in future drill targeting. The New England Granite prospect comprises a granitic intrusive measuring approximately 4.3km x 2km that is cut by large scale tensional faults subordinate to the nearby Ockerbury Fault. Historic drilling has demonstrated that the deformed margins of the granite in contact with the surrounding greenstone sequence has elevated gold associated with quartz veining. The competency contrast related to granite-greenstone contacts is a common gold mineralisation control in the Yandal belt and elsewhere. Data generated from the aeromagnetic survey has assisted in accurately delineating the deformed granite margins and prospective cross-cutting faults, which in turn is being used in drill targeting. During the second half of the year the Company completed a litho-structural reinterpretation and targeting study using independent consultant, Mike Outhwaite (Lithify Pty Ltd). This work fed into a project-wide prospect ranking exercise completed by the in-house exploration team. As a result, the company has determined that the priority prospects to focus on over the coming six to twelve months will include Oblique, Quarter Moon and New England Granite (Figures 4 and 5). Each of these prospects has large scale potential with strike extents in-excess of 1.5km at Oblique and Quarter Moon and 4km at New England Granite and demonstrated gold mineralisation in previous broad spaced drilling. Operations Report IRONSTONE WELL-BARWIDGEE continued Yandal Resources Limited Annual Report 2023 7 Figure 4 - Oblique and Quarter Moon targets showing proximity to Flushing Meadows Resource over TMI and 1VD aeromagnetics Figure 5 - New England Granite Prospect showing +4km long eastern margin target zone over TMI and 1VD aeromagnetics Operations Report MT MCCLURE Yandal Resources Limited Annual Report 2023 8 The Mt McClure Project is located 15km SW of the historic Bronzewing gold mine and 10km from Orelia gold mine both owned by Northern Star Resources Ltd (ASX: NST) in the southern Yandal Belt (Figure 6). The greater Mt McClure gold camp, which covers a strike length of some 30km and includes Northern Star’s Orelia mine (+1Moz), has a total gold endowment of +1.8Moz. Yandal’s Mt McClure Project includes several historical open cut pits from which a total of approximately 100,000z of gold was mined to maximum depths of between 60 to 100m mostly in the 1990’s. During the year, the Company completed initial Mineral Resource Estimates (“MRE’s”) on the margins of the Success, Parmelia and Challenger historic open cuts incorporating the extensive historic drilling database and recent Yandal drilling, which highlighted significant zones of unmined mineralisation extending up to 240m beneath the base of previous mining. The MRE’s defined a combined Resource inventory at Mt McClure of 2.225Mt @ 1.9g/t Au for 136,000oz at a 1.0g/t lower cut-off, as summarised in Table 1. Additional RC drilling during the year and subsequent to year’s end outside of the historic open cut footprints has defined additional zones of shallow, predominantly oxide mineralisation. Notably, drilling at HMS Sulphur, located immediately north of the Success historic open cut and MRE area, has defined a zone of mineralisation extending over a 700m strike length and down to a depth of 150m. An initial MRE for HMS Sulphur is expected to be completed early next year. Figure 6 - Plan view of the Mt McClure project showing the regional geology, tenements, location of key prospects Table 1 – Breakdown of Mt McClure initial Mineral Resource Estimate by Deposit (1.0 g/t Au lower cut-off) Category Deposit Challenger(1) Success(2) Parmelia(3) Total Inferred Tonnes (000’s) 718 1,255 252 2,225 Grade (g/t) 1.9 1.9 2.1 1.9 Au (Oz) 44,000 75,000 17,000 136,000 Note: Due to the effects of rounding totals may not represent the sum of the individual components. The individual MRE’s at each deposit are open at depth and constrained by a lack of drilling, and in some cases indicate plunging shoots which have higher grade potential. Refer to the YRL ASX Announcements of (1) 22 August 2022, (2) 6 September 2022 and (3) 20 September 2022 for details of MREs Operations Report MT MCCLURE continued Yandal Resources Limited Annual Report 2023 9 Figure 7 - Success Long Section showing block model coloured according to grade, historic pit outline (grey) and Yandal broad spaced drilling (blue traces) New RC intercepts during the year include: HMS Sulphur • • 14m @ 1.3g/t Au from 113m including 2m @ 6.4g/t Au from 119m (YRLRC1076); 8m @ 1.7g/t Au from 148m including 4m @ 3.1g/t Au (YRLRC1077); Gilmore • • 21m @ 0.8g/t Au from 90m including 3m @ 2.5g/t Au from 90m (YRLRC1086); 17m @ 0.6g/t Au from 43m including 5m @ 1.4g/t Au from 45m (YRLRC1085) In addition to RC drilling at advanced prospects, a total of eleven early-stage targets were tested by an aircore program focussed on the under-explored hanging wall sequence east of the main line of mineralisation. Targets were generally in areas interpreted as favourable for mineralisation based on proximity to cross-cutting (conjugate) faults and/or areas exhibiting demagnetisation, potentially representing alteration associated with mineralisation. Of the eleven targets tested, three returned significant gold results (>0.1g/t Au) and have been earmarked for follow-up in the coming year. Operations Report GORDONS Yandal Resources Limited Annual Report 2023 10 The 100%-owned Gordons Project is located 35km north of Kalgoorlie. The project covers approximately 112km2 of tenure adjacent to operating mines at Gordon Sirdar and Mulgarrie and is close to both third party and publicly owned haulage infrastructure. Significantly, it is located on the flank of the Scotia-Kanowna Dome, a key regional geological feature, that is an important control on the formation of gold mineralisation, including the multi-million ounce Kanowna Belle and Paddington deposits. During the year the company completed an Initial MRE for Gordons Dam and undertook a comprehensive 3D model of the geology and structure of the broader project to assist in prioritising future work and drill targeting. The Gordons Dam deposit is located on a granted mining lease toward the northern end of the project and represents a new discovery by Yandal. The initial Gordons Dam MRE contains a total of 365,000t @ 1.7g/t Au for 20,000oz (> 1g/t Au lower cut-off grade) as summarised in Table 2. The deposit consists of laterite and paleochannel hosted mineralisation overlying weathered and fresh bedrock hosted mineralisation. Bedrock mineralisation remains open down-plunge and along strike. Recent 3D geological modelling indicates that a felsic intrusion, likely a key mineralisation control, plunges to the to the north-east and represents a potential future drill target. Figure 8 - Regional geology map of Gordons Project showing key prospect locations and nearby mines. Table 2 – March 2023 Gordons Dam Mineral Resource Estimate (1.0g/t Au Lower Grade Cut-off) above 120m vertical depth. Category Material Type Transported (paleochannel) Oxide Transitional Fresh Total Inferred Tonnes 48,000 99,000 152,000 65,000 365,000 Grade (g/t Au) 1.8 2.0 1.5 1.5 1.7 Total (oz) 3,000 6,000 7,000 3,000 20,000 Note: Due to the effects of rounding, totals may not represent the sum of all individual components. The Resource is reported as a global estimate, not constrained within optimised pit shells. Full details of the MRE are available in YRL’s ASX Release of 6 April 2023. Yandal Resources Limited Annual Report 2023 11 Operations Report GORDONS continued The 3D geological modelling and targeting exercise over the entire Gordons Project was designed to determine the structural and stratigraphic controls on mineralisation. This work highlighted that a key prospective feature in the region is the Gordon-Sirdar Shear Zone (“GSSZ”) and associated splays which extend through the Gordons Project and are coincident with Star of Gordon prospect and the nearby Gordon-Sirdar mine (Figure 9). The GSSZ is associated with a steepening of the eastern margin of the main Scotia-Kanowna Granite Dome. This geometry provides opportunities for enhanced fluid permeability and strain partitioning making it an ideal location for targeting larger-scale gold mineralisation. In association with the GSSZ the study also interpreted a keel of mixed greenstones interpreted to be similar to the Kanowna Belle lithologies extending south of the Gordons Project. Prospects proximal to the GSSZ have the highest potential for large discoveries and will be the focus of exploration moving forward. In response to the findings of the study the Company acquired the rights to a key tenement (E27/701 – currently in the application phase) that covers the interpreted extension of the GSSZ structure extending south from the Gordons Project towards Kanowna Belle (Figure 9). The Company regards this as an excellent opportunity to explore an area in an exceptional geological setting for the discovery of significant gold deposits near the major mining centre of Kalgoorlie. Figure 9 - Schematic views of broad scale three-dimensional modelling showing interpreted boundaries of Scotia-Kanowna Granite from Bouger gravity (left diagram) and rendering of granite morphology (pink) and location of key structures (red) (right diagram). Operations Report MINERAL RESOURCES Yandal Resources Ltd - Mineral Resource Summary Deposit Indicated Grade (g/t) Tonnes (‘000s) Au (oz) Tonnes (‘000) Inferred Grade (g/t) Au (oz) Tonnes (000’s) Total Grade (g/t) Au (Oz) Yandal Resources Limited Annual Report 2023 12 1.3 5,245 7,386 2,141 91,000 1.1 177,000 Ironstone Well Flushing Meadows1 Mt McClure Challenger2 Success3 Parmelia4 Sub-total - MMC Gordons Gordons Dam5 Grand-total6 Due to the effects of rounding totals may not represent the sum of the individual components. 1. Reported above 0.5g/t Au lower cut-off grade, refer to Yandal Resources Ltd ASX announcement dated 4 November 2020 for full details. 2. Reported above 1.0g/t Au lower cut-off grade, refer to Yandal Resources Ltd ASX announcement dated 22 August 2022 for full details 3. Reported above 1.0g/t Au lower cut- off grade, refer to Yandal Resources Ltd ASX announcement dated 6 September 2022 for full details.4. Reported above 1.0g/t Au lower cut-off grade, refer to Yandal Resources Ltd ASX announcement dated 20 September 2022 for full details 5. Reported above 1.0g/t Au lower cut-off grade, refer to Yandal Resources Ltd ASX announcement dated 6 April 2023 for full details 6. All Resources are reported as global estimates, not constrained by optimised pit shells. 44,000 1.9 75,000 1.9 2.1 17,000 1.9 136,000 44,000 75,000 17,000 136,000 20,000 1.7 1.3 333,000 718 1,255 252 2,225 718 1,255 252 2,225 20,000 424,000 1.9 1.9 2.1 1.9 365 9,976 365 7,835 268,000 1.7 1.3 91,000 2,141 1.1 1.3 COMPETENT PERSONS STATEMENT The information in this document that relates to Exploration Results, geology and data compilation is based on information reviewed or compiled by Mr Chris Oorschot, a Competent Person who is a Member of The Australasian Institute Geoscientists. Mr Oorschot is the Exploration Manager for the Company, is a full-time employee and holds options in the Company. Mr Oorschot has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity 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 Oorschot consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears. The information in this announcement that relates to the Flushing Meadows, Mt McClure and Gordons Dam Mineral Resource Estimates is based on information compiled and generated by Andrew Bewsher, an employee of BM Geological Services Pty Ltd (“BMGS”). Both Andrew Bewsher and BMGS hold shares in the company. BMGS consents to the inclusion, form and context of the relevant information herein as derived from the original resource reports. Mr Bewsher has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which is being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the JORC Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. YRL confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcements. FORWARD LOOKING STATEMENTS This document may contain certain forward-looking statements. Forward-looking statements include, but are not limited to, statements concerning Yandal Resources Limited’s (Yandal’s) current expectations, estimates and projections about the industry in which Yandal operates, and beliefs and assumptions regarding Yandal’s future performance. When used in this document, words such as “anticipate”, “could”, “plan”, “estimate”, “expects”, “seeks”, “intends”, “may”, “potential”, “should”, and similar expressions are forward-looking statements. Although Yandal believes that its expectations reflected in these forward-looking statements are reasonable, such statements are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the control of Yandal and no assurance can be given that actual results will be consistent with these forward-looking statements. Drilling results presented indicate geological potential for mineralisation but there can be no certainty that these results will eventually form part of a Mineral Resource Estimate. Directors’ Report Your Directors present their report on Yandal Resources Limited for the financial year ended 30 June 2023. DIRECTORS The following persons held office as Directors of Yandal Resources Limited during the financial period and up to the date of this report unless otherwise noted: Yandal Resources Limited Annual Report 2023 13 Mr Tim Kennedy Mr Greg Evans Ms Katina Law Managing Director Non-Executive Chairman Non-Executive Director INFORMATION ON DIRECTORS AND OFFICERS TIMOTHY KENNEDY B.App Sc (Geology), MBA, MAusIMM, MGSA MANAGING DIRECTOR (appointed 17 February 2021, appointed Chair 1 July 2021, resigned as Chair 4 April 2022, appointed Managing Director 4 April 2022) Mr Kennedy is a geologist with a successful 30+ year career in the mining industry, including extensive involvement in the exploration, feasibility and development of gold, nickel, platinum group elements, base metals and uranium projects throughout Australia. His most recent executive role was as exploration manager with IGO Limited, which during his 11 years IGO grew from being a junior explorer to a multi-commodity mining company. Mr Kennedy played a key role as part of the team that represented IGO on the exploration steering committee with AngloGold Ashanti during the multi-million ounce Tropicana, Havana and Boston Shaker discoveries and the discoveries by IGO of the Rosie magmatic nickel sulphide deposit; the Triumph VMS deposit and the Bibra orogenic gold deposit. Prior to that Mr Kennedy held senior positions with global miner Anglo American, including as Exploration Manager – Australia and Principal Geologist/Team Leader – Australia. He also held senior technical positions with Resolute Limited, Hunter Resources and PNC Exploration Pty Ltd. Current and Former Directorships held in the past three years: Helix Resources Limited Sipa Resources Limited Non-Executive Director Non-Executive Director/Chair GREG EVANS BCom, DipApp Fin, GAICD NON-EXECUTIVE CHAIRMAN (appointed 4 April 2022) Appointed 16 February 2018, Resigned 18 March 2022 Appointed 13 December 2016, Chair 28 August 2018 Resigned 28 February 2022 Mr Evans has over 25 years in advising corporates, boards, directors, executive management teams, and providers of debt and equity and other financial sponsors on capital raisings, mergers and acquisition transactions, equity and debt structuring, public offers, takeover defence, and strategic and growth options. He specialises in energy and natural resources with a particular focus on the mining sector. He has a Bachelor of Commerce, a Diploma in Applied Finance and is a Graduate of the Australian Institute of Company Directors. Mr Evans is Principal of his own corporate and investment banking advisory business. Current and Former Directorships held in the past three years: Mr Evans has no other public company directorships. Yandal Resources Limited Annual Report 2023 14 Directors’ Report INFORMATION ON DIRECTORS AND OFFICERS continued MS KATINA LAW BCom, FCPA, MBA, GAICD NON-EXECUTIVE DIRECTOR (appointed 1 July 2018, resigned Chair on 1 July 2021) Katina Law has over 30 years’ experience in the mining industry covering corporate and site based roles across several continents. She has worked with a number of ASX listed resources companies in strategic financial advisory and general management roles. Ms Law has worked on several development and evaluation projects which were later subject to corporate transactions including the Deflector gold and copper project and the King Vol polymetallic zinc project. Ms Law has previously held positions as CEO and Chair of ASX listed entities. Ms Law has a Bachelor of Commerce degree from UWA, is a Certified Practising Accountant and has an MBA from London Business School. She is currently a Board Member of Health Support Services. Current and Former Directorships held in the past three years: DGO Gold Limited Non-Executive Director Ms Law has no other public company directorships. MR GREG FITZGERALD BCom COMPANY SECRETARY (appointed 1 February 2023) Appointed 1 June 2020, Resigned 30 June 2022 Takeover from Gold Road Resources occurred on 30 June 2022 Mr Fitzgerald is a former Chartered Accountant with over 30 years of resources related experience obtained through current and past roles as a Non-executive Director, Chief Financial Officer and Company Secretary. He has extensive commercial experience across the exploration, evaluation, development and operational phases of projects based in Australia and Africa. Mr Fitzgerald is currently Company Secretary of several ASX listed companies. MRS BIANCA TAVEIRA COMPANY SECRETARY (resigned 1 February 2023) Mrs Taveira is an experienced company administrator and manager who has acted as Company Secretary to a number of unlisted public and ASX listed natural resource companies for over two decades. During this time Mrs Taveira has been involved in a number of initial public offerings, reverse takeover transactions, corporate transactions and capital raisings. Mrs Taveira has a corporate and compliance background and is experienced with administration of the shareholder registry, the ASX Listing Rules, mining tenement management and the Department of Mines regulations. Mrs Taveira is currently the Company Secretary of Reward Minerals Ltd (ASX: RWD) and Empire Resources Limited (ASX: ERL). CORPORATE INFORMATION Yandal Resources Limited is a Company limited by shares that was incorporated on 16 April 2004 and is domiciled in Australia. The Company was converted to a public company and changed its name from Orex Mining Pty Ltd to Yandal Resources Limited on 27 March 2018. The Company listed on the Australian Securities Exchange on 14 December 2018 (ASX: YRL). PRINCIPAL ACTIVITIES The principal continuing activity of the Company during the year was gold exploration. Directors’ Report RESULTS OF OPERATIONS The results for the year ended 30 June 2023 was a loss after income tax benefit of $1,040,771 (2022: $978,228 loss). Yandal Resources Limited Annual Report 2023 15 EARNINGS/(LOSS) PER SHARE Basic earnings/(loss) per share Diluted earnings/(loss) per share REVIEW OF OPERATIONS 2023 ¢ (0.72) (0.72) 2022 ¢ (0.89) (0.89) Refer to the Operations Report for detailed information on the Company’s exploration activities over the past year. SIGNIFICANT CHANGES IN STATE OF AFFAIRS Other significant changes to the state of affairs during the year, other than outlined in the Operations Report, are as follows: • • In July 2022, Gold Road Resources Limited completed its off-market takeover offer for all the ordinary shares in DGO Gold Limited, the Company’s largest shareholder. In October 2022, the Company launched a Placement (“Placement”) and Pro-rata Non-renounceable Rights Issue Offer (“Rights Issue”), which was completed in November 2022. Under the Placement, the Company raised approximately $2.3M and issued 19,166,667 New Shares at an issue price of 12 cents per New Share. In conjunction with the Placement, the Company raised approximately $2.7M and issued 22,542,359 Rights Issue Shares also at an issue price of 12 cents per New Share. The New Shares included and attached a free New Option for every two New Shares with an exercise price of 24 cents and an expiry date of 31 October 2024. The new capital raised was to specifically accelerate the Company’s exploration programs. • During the year, the Company’s option holders had exercised: o 2,500 options at $0.65 to raise $1,625. • On 1 February 2023, Company Secretary, Mrs Bianca Taveira stepped down from the role. Mr Greg Fitzgerald was appointed Company Secretary on 1 February 2023. • • • In March 2023, the Company moved and changed its registered address to Unit 5, 62 Ord Street, West Perth. In March 2023, the Company issued 1,000,000 unlisted options to an employee under its Employee Incentive Scheme, the unlisted options will vest after one year of employment and will have a 3 year life after vesting and are exercisable on or before 27 February 2027 at an exercise price of 18 cents. In March 2023, the Company issued 4,000,000 unlisted options to Resource Surveys Pty Ltd (an entity controlled by Mr Eduard Eshuys) for consulting services. Tranche 1, 2,000,000 unlisted options will vest in four equal amounts at the end of each 3 month period from the Commencement Date over the course of the first year and are exercisable on or before 1 March 2026 at an exercise price of 18 cents. Tranche 2, 2,000,000 unlisted options will vest in four equal amounts at the end of each 3 month period commencing from 1 March 2024 and are exercisable on or before 1 March 2027 at an exercise price of 27 cents. Other than the matters above, there were no significant changes in the state of affairs of the Company during the period. Yandal Resources Limited Annual Report 2023 16 Directors’ Report RISKS OVERVIEW The Board is responsible for the oversight of the Company’s risk management and control framework. The material business risks that the Company faces that could influence the Company’s future prospects and how these are managed, are outlined below. • Exploration and Development Mineral exploration and development is a speculative and high-risk undertaking that may be impeded by circumstances and factors beyond the control of the Company. There is no assurance that exploration of the tenements will result in the discovery of an economic deposit. Even if an apparently viable deposit is identified there is no guarantee that it can eventually be economically exploited. The future exploration and development activities of the Company may be affected by a range of factors including geological conditions, limitations on activities due to seasonal weather patterns, unanticipated operational and technical difficulties, industrial and environmental accidents, changing government regulations and other factors beyond the control of the Company. This is managed where possible by the employment of competent personnel and reputable consultants with the relevant skills and experience to deal with these issues, extensive technical analysis and planning, and undertaking field exploration activities during more favourable seasonal weather patterns. • Capital and financing risk Yandal’s continued ability to operate its business and effectively implement its business plan over time will depend in part on its ability to raise additional funds for future operations. There is risk that Yandal may not be able to access equity or debt capital markets to support its business objectives. Management and the Board constantly monitor and optimise non- discretionary expenditure and critically assess discretionary spend to ensure alignment with strategy. Cash flow forecasts are reviewed approximately monthly in order to assess future funding requirements. • Native title and Aboriginal heritage and Access to Tenure There is a substantial level of regulation and restriction on the ability of exploration and mining companies to have access to land in Australia. Negotiations with both Native Title and land owners/occupiers are generally required before the Company can access land for exploration or mining activities. Further, activities can be restricted by the Aboriginal heritage sites that may be present. Inability to access, or delays experienced in accessing the land, may adversely impact on the Company's activities. If native title rights do exist (and have not been extinguished), the ability of the Company to gain access to tenements (through obtaining consent of the native title claimants or holders, or any relevant landowners as applicable), or to progress from the exploration phase to the development and mining phases of operations may be adversely affected. The Company has a policy to contact all relevant stakeholders prior to commencing activities. Heritage surveys are undertaken as required in accordance with regulations and agreements to ensure positive working relationships with key stakeholders are maintained. • Gold Price and Exchange Rates The Company’s projects are primarily prospective for gold. Gold and other commodity prices can fluctuate significantly and the gold price is exposed to numerous factors beyond the control of the Company. A significant decrease in the gold price is likely to adversely affect sentiment and market support towards a gold exploration company. • Dependence on key personnel The Company’s success depends in part on the core competencies of the Directors and management and the ability of the Company to retain these key executives. Loss of key personnel (such as the Managing Director) may have an adverse impact on the Company's performance. The Company remunerates and incentivises at appropriate market rates to reduce the risk of losing key personnel. Yandal Resources Limited Annual Report 2023 17 Directors’ Report EVENTS AFTER REPORTING DATE No other matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial years. FUTURE DEVELOPMENTS In the opinion of the Directors it would prejudice the interests of the Company to provide additional information, beyond that reported in this Annual Report, relating to likely developments in the operations and the expected results of those operations in financial years ended subsequent to 30 June 2023. DIVIDENDS No amount has been paid or declared by way of dividend. The Directors do not recommend that any dividend be paid. MEETINGS OF DIRECTORS The number of meetings held during the year ended 30 June 2023, and the number of meetings attended by each Director were: Full Meetings of Directors Audit & Risk Committee Meetings Director T Kennedy G Evans K Law Eligible to Participate Number Attended Eligible to Participate Number Attended 8 8 8 8 8 8 2 2 2 2 2 2 Remuneration Committee Meetings Eligible to Participate Number Attended 1 1 1 1 1 1 In addition to the above meetings several matters were dealt with by circular resolution. DIRECTOR SHARE AND OPTION HOLDINGS As at the date of this report, the interests of the Directors in the shares, options and performance rights of the Company were: Ordinary Shares Unlisted Options Exercise price 24 cents, expiry 31 October 2024 Unlisted Options Exercise price 50 cents, expiry 4 April 2025 Unlisted Options Exercise price $1, expiry 4 April 2026 Class D Performance Rights Director T Kennedy G Evans K Law Direct Interest - - - Indirect Interest 260,537 311,651 1,943,520 Direct Interest - - - Indirect Interest 11,327 5,826 158,011 Direct Interest - - - Indirect Interest 1,000,000 300,000 - Direct Interest - - - Indirect Interest 1,000,000 300,000 Direct Interest - - - 150,000 Indirect Interest 150,000 - - Yandal Resources Limited Annual Report 2023 18 Directors’ Report SHARES UNDER OPTION Unissued ordinary shares of Yandal Resources Limited under option as at the date of this report are as follows: Nature Expiry Date Exercise Price of Options Number under Option Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options 31 October 2024 4 April 2025 1 September 2025 1 March 2026 4 April 2026 27 February 2027 1 March 2027 24 cents 50 cents 30 cents 18 cents $1 18 cents 27 cents 22,854,535 1,300,000 350,000 2,000,000 1,300,000 1,000,000 2,000,000 Option holders do not have any rights to participate in any issues of shares or other interests in the Company or any other entity. There have been no unissued shares or interests under option of any controlled entity within the Company during or since the end of the reporting period. No person entitled to exercise the option had or has any right by virtue of the option to participate in any share issue of any other body corporate. Remuneration Report (Audited) The information provided in this remuneration report has been audited as required by section 300A of the Corporations Act 2001. A Principles Used to Determine Amount and Nature of Remuneration All remuneration paid to Directors and Executives is valued at the cost to the Company and expensed. Shares given to Directors and Executives are valued as the difference between the market price of those shares and the amount paid by the Director or Executive. Options and Performance Rights are valued using the Black-Scholes or Binomial methodologies. The Board policy is to remunerate Non-Executive Directors at market rates for comparable companies for time, commitment and responsibilities. The Board determines payments to the Non-Executive Directors and reviews their remuneration annually based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can be paid to Non-Executive Directors is subject to approval by shareholders at the annual general meeting (currently $300,000). Fees for Non-Executive Directors are not linked to the performance of the Company. However, to align Directors’ interests with shareholder interests, the Directors are encouraged to hold shares in the Company and are able to participate in employee incentive plans. The objective of the Company’s executive reward framework is set to attract and retain suitably qualified and experienced Directors and Senior Executives. The Board ensures that executive reward satisfies the following criteria for good reward governance practices: • • • • competitiveness and reasonableness acceptability to shareholders transparency capital management Yandal Resources Limited Annual Report 2023 19 Directors’ Report Directors’ Fees A Director may be paid fees or other amounts as the Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director. A Director may also be reimbursed for out-of-pocket expenses incurred as a result of their directorship or any special duties. Performance Based Remuneration The Company uses both short term and long term incentive programs to balance the short and long term aspects of business performance, to reflect market practice, to attract and retain key talent and to ensure a strong alignment between the incentive arrangements of Executives and the creation and delivery of shareholder return. Executives are encouraged by the Board to hold shares in the Company, and it is therefore the Company’s objective to provide incentives for participants to partake in the future growth of the Company and, upon becoming shareholders in the Company, to participate in the Company’s profits and dividends that may be realised in future years. The Board considers that this equity performance linked remuneration structure is effective in aligning the long-term interests of Company executives and shareholders as there exists a direct correlation between shareholder wealth and executive remuneration. The Company provides benefits to employees and directors of the Company in the form of share-based payment transactions, whereby performance rights and options were granted at nil consideration as an employment incentive. The performance rights and options were issued with vesting conditions, see Note 20 of the financial statements for details. Company Performance, Shareholder Wealth and Directors’ and Executives’ Remuneration The remuneration policy has been tailored to increase goal congruence between shareholders, Directors and Executives. This is facilitated through the issue of options or performance rights to Directors and Executives to encourage the alignment of personal and shareholder interests. The Company believes this policy will be effective in increasing shareholder wealth. The factors that are considered to affect total shareholders’ return are summarised below: EPS (cents) Dividends (cents per share) Loss ($’000) Share Price at 30 June (cents) 2023 (0.72) - 1,041 5.0 2022 (0.89) - 978 15.0 2021 (0.67) - 599 58.5 2020 (0.77) - 503 27.0 2019 (1.69) - 670 22.0 Yandal Resources Limited Annual Report 2023 20 Directors’ Report B Details of Remuneration of Key Management Personnel of the Company Details of the nature and amount of each element of remuneration of each Director and key management personnel of the Company for the financial year are as follows: Directors Year Consulting Fees $ Salary $ Directors’ Fee $ T Kennedy Managing Director Post Employment Superannuation $ Share Based Payments Expense (Performance Rights) $ Share Based Payments Expense (Options) $ Total $ Performance Related % 2023 2022 - - 282,604 - 75,833 43,333 27,500 11,917 17,161 50,548 377,813 24,915 74,436 230,434 G Evans Non-Executive Chairman 2023 2022 - - K Law Non-Executive Director 2023 2022 - - - - - - 65,000 16,000 55,000 55,000 D Hughes Director (resigned 17 May 2022) Totals 2023 2022 2023 2022 - - - - - 327,886 - - 282,604 120,000 403,719 114,333 6,825 1,600 5,775 5,500 - 24,192 40,100 43,209 - - 15,165 22,331 86,990 39,931 17,161 24,915 - -* - - - - 77,936 85,415 - 352,078 34,322 65,713 542,739 49,830 96,767 707,858 18% 43% 17% 56% 22% 29% - - There were no termination benefits paid during the year to any Director or key management personnel. *Performance rights had been issued to Mr Hughes however upon resignation these rights were cancelled as the milestone was not met and any amounts expensed were reversed. Accordingly, there were Nil share based payments expense for Mr Hughes. C Share-Based Compensation Options 2023 Options There were no options issued to Key Management Personnel during the year ended 30 June 2023. An amount of $65,713 was expensed during the year ended 30 June 2023, pertaining to the Tranche 2 options issued in 2022. Directors Grant Date No of Options Granted Fair value per option at Grant Date Vested at 30 June 2023 Total value of Options $ Amount expensed in 2022 $ Amounts expensed in 2023 $ Balance of options at year end T Kennedy 19 May 2022 1,000,000 $0.0582 1,000,000 G Evans 19 May 2022 300,000 $0.0582 300,000 58,185 17,456 75,641 7,637 2,291 9,928 50,548 1,000,000 15,165 65,713 300,000 Yandal Resources Limited Annual Report 2023 21 Directors’ Report C Share-Based Compensation continued Options continued 2022 Options (i) There were options issued to Mr Evans and Mr Kennedy as remuneration during the year ended 30 June 2022. The options were issued in two tranches as follows: Tranche 1: The fair value of the incentive options issued to the Directors is $86,839 as determined using the Black-Scholes valuation methodology. The options were granted on 19 May 2022 with an expiry date of 4 April 2025 and an exercise price of $0.50 per option. The option values are as follows: Directors Grant Date No of Options Granted Fair value per option at Grant Date Vested at 30 June 2022 Total value of Options $ T Kennedy 19 May 2022 1,000,000 $0.0668 1,000,000 G Evans 19 May 2022 300,000 $0.0668 300,000 66,799 20,040 86,839 Amount expensed in 2022 $ 66,799 20,040 86,839 Amounts to be expensed in 2023 $ - - - Balance of options at year end 1,000,000 300,000 Tranche 2: The fair value of the incentive options issued to the Directors is $75,641 as determined using the Black-Scholes valuation methodology. The options were granted on 19 May 2022 with an expiry date of 4 April 2026 and an exercise price of $1.00 per option. These options have a vesting condition of continuous service until 4 April 2023 for the directors. The option values are as follows: No of Options Granted Fair value per option at Grant Date Vested at 30 June 2022 Total value of Options $ Amount expensed in 2022 $ Amounts to be expensed in 2023 $ Balance of options at year end Directors Grant Date T Kennedy 19 May 2022 1,000,000 $0.0582 G Evans 19 May 2022 300,000 $0.0582 - - 58,185 17,456 75,641 7,637 2,291 9,928 50,548 1,000,000 15,165 65,713 300,000 An amount of $9,928 was expensed in 2022 for the Tranche 2 options, being the value of the options apportioned over the vesting period. Yandal Resources Limited Annual Report 2023 22 Directors’ Report Performance Rights In the year ended 30 June 2023 the Company did not issue any Performance Rights. During the year $34,322 was recognised as a share-based payment expense. In the year ended 30 June 2022 the Company issued Class B, C and D Performance Rights to Directors. Full details are contained in Note 20 to the financial statements. The following table summarises the equity-settled performance rights issued to Directors: Class B Number issued Fair value per right Total fair value if all hurdles are met Amount expensed - 2022 Amount expensed current year Amount to be expensed in future years if all hurdles are met Class C Number issued Fair value per right Total fair value if all hurdles are met Amount expensed – 2022 Amount expensed current year Amount to be expensed in future years if all hurdles are met Class D Number issued Fair value per right Total fair value if all hurdles are met Amount expensed - 2022 Amount expensed current year Amount to be expensed in future years if all hurdles are met Total Amount expensed - 2022 Amount expensed current year Amount to be expensed in future years if all hurdles are met Total * Mr Hughes’ performance rights were cancelled following his resignation. Mr Hughes* $ Ms Law $ Mr Kennedy $ 400,000 0.0969 38,760 - - - 400,000 0.1043 41,720 - - - 400,000 0.1291 51,640 - - - - - - - 150,000 150,000 0.0969 14,535 14,470 65 - 150,000 0.1043 15,645 5,924 9,695 26 150,000 0.1291 19,365 4,522 7,401 7,442 24,916 17,161 7,468 49,545 0.0969 14,535 14,470 65 - 150,000 0.1043 15,645 5,924 9,695 26 150,000 0.1291 19,365 4,522 7,401 7,442 24,916 17,161 7,468 49,545 Yandal Resources Limited Annual Report 2023 23 Directors’ Report D Service Contracts Mr Kennedy entered into an executive service agreement with the Company under which he is engaged as Managing Director. The engagement of Mr Kennedy under the agreement commenced on 4 April 2022 and continues until terminated by either party. The Company may terminate the employment without notice upon limited events akin to misconduct or incapacity. Additionally, the Company may terminate the agreement without cause upon one month's written notice. Mr Kennedy may terminate the agreement without cause on 3 months’ written notice. Non-Executive Directors are not employed under written contracts. Non-Executive Directors may be paid consulting fees at commercial rates calculated according to the amount of time spent on the Company’s business. All Directors may receive consulting fees on an hourly basis which are paid from time to time for specialist services beyond normal duties. No Directors have received loans from the Company during the annual period. E Key Management Personnel Disclosures Key Management Personnel Interests in the Shares and Options of the Company Director Shares Interests of the Directors in the shares and options of the Company at 30 June 2023 and 30 June 2022 were: 2023 T Kennedy G Evans K Law 2022 T Kennedy G Evans (appointed 4 April 2022) K Law D Hughes (resigned 17 May 2022) # Balance held at resignation Balance at start of the year Shares acquired during the year Options exercised during the year Shares disposed of during the year Balance at the end of the year 116,667 60,000 1,627,500 1,804,167 - - 597,500 4,141,381 22,654 11,651 316,020 350,325 116,667 60,000 30,000 129,059 - - - - - - 1,000,000 1,088,182 - - - - - - - (625,000) 139,321 71,651 1,943,520 2,154,492 116,667 60,000 1,627,500 4,733,622# 4,738,881 335,726 2,088,182 (625,000) 6,537,789 Directors’ Report Director Options The number of options over ordinary shares in the Company held during the financial year by each Key Management Personnel of Yandal Resources Limited including their personally related parties are set out below: Yandal Resources Limited Annual Report 2023 24 Balance at start of the year Options acquired Options granted^ Options expired during the year Exercised during the year Value of options exercised ($) Balance at the end of the year Vested and exercisable at the end of the year 2,003,334 600,000 11,327 5,826 - 158,011 2,603,334 175,164 - - - - (3,334) - - (3,334) 2023 T Kennedy G Evans* K Law 2022 T Kennedy G Evans* K Law - - 1,000,000 3,334 2,000,000 - - 600,000 - - D Hughes** 1,088,182 49,167 2,088,182 52,501 2,600,000 *appointed 4 April 2022 **resigned 17 May 2022 ^refer to Note 20(b) Director Performance Rights - - - - - - - - - - - - 2,011,327 2,011,327 605,826 158,011 605,826 158,011 2,775,164 2,775,164 2,003,334 1,003,334 600,000 300,000 (1,000,000) (1,088,182) 250,000 272,046 - - 49,167 49,167 (2,088,182) 522,046 2,652,501 1,352,501 - - - - - The number of performance rights over ordinary shares in the Company held during the financial year by each Key Management Personnel of Yandal Resources Limited including their personally related parties are set out below: 2023 T Kennedy G Evans K Law Balance at start of the year Rights Acquired Rights granted Rights expired during the year Rights converted during the year Balance at the end of the year 450,000 - 450,000 900,000 - - - - - - - - (150,000) - (150,000) (300,000) - - - - 300,000 - 300,000 600,000 Full details are contained in Note 20 to the financial statements. There were no performance rights issued to Directors during year ended 30 June 2023. [End of remuneration report] Yandal Resources Limited Annual Report 2023 25 Directors’ Report NON-AUDIT SERVICES The auditors have not provided any non-audit services to the Company in the current financial year. INDEMNIFICATION AND INSURANCE OF OFFICERS OR AUDITOR During the financial year, the Company maintained an insurance policy which indemnifies the Directors and Officers of Yandal Resources Limited in respect of any liability incurred in connection with the performance of their duties as Directors or Officers of the Company. The Company's insurers have prohibited disclosure of the amount of the premium payable and the level of indemnification under the insurance contract. AUDITOR’S INDEPENDENCE DECLARATION In accordance with section 307C of the Corporations Act 2001, the Directors have obtained a Declaration of Independence from HLB Mann Judd, the Company’s auditors, as presented on page 26 of this year’s financial report. ENVIRONMENTAL REGULATION The Company’s Projects are subject to State and Federal laws and regulations regarding environmental matters. The Governments and other authorities that administer and enforce environmental laws and regulations determine these requirements. As with all exploration projects and mining operations, the Company's activities are expected to have an impact on the environment, particularly, if the Company's activities result in mine development. The Company intends to conduct its activities in an environmentally responsible manner and in accordance with applicable laws. PROCEEDINGS ON BEHALF OF COMPANY No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year. This report is made in accordance with a resolution of the Directors and signed for on behalf of the Directors by: MR TIM KENNEDY Director 20 September 2023 Perth, WA 26 AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the audit of the financial report of Yandal Resources Limited for the year ended 30 June 2023, I declare that to the best of my knowledge and belief, there have been no contraventions of: a) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and b) any applicable code of professional conduct in relation to the audit. Perth, Western Australia 20 September 2023 B G McVeigh Partner 27 INDEPENDENT AUDITOR’S REPORT To the Members of Yandal Resources Limited REPORT ON THE AUDIT OF THE FINANCIAL REPORT Opinion We have audited the financial report of Yandal Resources Limited (“the Company”) which comprises the statement of financial position as at 30 June 2023, the statement of profit or loss and other comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration. In our opinion, the accompanying financial report of the Company is in accordance with the Corporations Act 2001, including: (a) giving a true and fair view of the Company’s financial position as at 30 June 2023 and of its financial performance for the year then ended; 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 Company in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (“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. Material Uncertainty Related to Going Concern We draw attention to Note 1(a) in the financial report, which indicates that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report. 28 Key Audit Matter How our audit addressed the key audit matter Carrying amount of exploration and evaluation expenditure Refer to Note 7 The Company has capitalised exploration and evaluation expenditure of $23,015,240 as at 30 June 2023. Our audit focussed on the Company’s assessment of the carrying amount of the capitalised exploration and evaluation asset, because this is one of the significant assets of the Company. There is a risk that the capitalised expenditure no the recognition criteria of the standard and whether facts and circumstances existed to suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. longer meets Our procedures included but were not limited to: processes • We obtained an understanding of the associated with key management’s the of exploration and evaluation expenditure carrying values; review • We tested a sample of amounts capitalised; • We considered the Director’s assessment of potential indicators of impairment; • We obtained evidence the Company has current rights to tenure of its areas of interest; that • We have discussed with management the nature of planned ongoing activities; • We enquired with management, reviewed ASX announcements and minutes of Directors’ meeting to ensure that the Company had not decided to discontinue exploration and evaluation at its area of interest; and • We examined the disclosures made in the financial report. 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 annual report for the year ended 30 June 2023, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. 29 Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Company to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company 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 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 judgement 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 Company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’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 Company 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. 30 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 with the directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore 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 REMUNERATION REPORT Opinion on the Remuneration Report We have audited the Remuneration Report included within the directors’ report for the year ended 30 June 2023. In our opinion, the Remuneration Report of Yandal Resources Limited for the year ended 30 June 2023 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. HLB Mann Judd Chartered Accountants Perth, Western Australia 20 September 2023 B G McVeigh Partner Yandal Resources Limited Annual Report 2023 31 Directors’ Declaration The Directors of the Company declare that: (a) The attached financial statements and notes thereto are in accordance with the Corporations Act 2001, including: (i) (ii) giving a true and fair view of the financial position and performance of the Company; and complying with Australian Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements. The financial statements and notes thereto also comply with International Financial Reporting Standards, as disclosed in Note 1 and other mandatory professional reporting requirements. The Directors have been given the declarations required by s.295A of the Corporations Act 2001. There are reasonable grounds to believe that Company will be able to pay its debts as and when they become due and payable. (b) (c) (d) This Declaration is made in accordance with a resolution of the Board of Directors and is signed for on behalf of the Directors by: MR TIM KENNEDY Director 20 September 2023 Perth, WA Statement of Profit or Loss and Other Comprehensive Income for the Year Ended 30 June 2023 Revenue from continuing operations Total Professional fees Administration fees Occupancy expenses Employee benefits expenses Share based payments Depreciation expenses Travel expenses Profit/(loss) before income tax Income tax (expense)/benefit Profit/(loss) after income tax for the year Yandal Resources Limited Annual Report 2023 32 Note 2 2023 $ 57,406 57,406 2022 $ 6,298 6,298 (186,405) (154,221) (334,100) (178,745) (32,373) (24,376) (199,291) (296,230) 20 (290,826) (257,936) (55,182) (63,524) - (9,494) (1,040,771) (978,228) 3 - - (1,040,771) (978,228) Other comprehensive income/(loss) for the year - - Total comprehensive income/(loss) attributable to Members of Yandal Resources Limited Basic profit/(loss) cents per share Diluted profit/(loss) cents per share (1,040,771) (978,228) 12 12 (0.72) (0.72) (0.89) (0.89) The above Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. Statement of Financial Position as at 30 June 2023 Yandal Resources Limited Annual Report 2023 33 CURRENT ASSETS Cash and cash equivalents Trade and other receivables Other Total Current Assets NON-CURRENT ASSETS Capitalised exploration expenditure Property, plant and equipment Total Non-Current Assets Total Assets CURRENT LIABILITIES Trade and other payables Total Current Liabilities Total Liabilities Net Assets EQUITY Contributed equity Reserves Accumulated (losses)/profits Total Equity Note 2023 $ 2022 $ 4 5 6 7 8 9 4,217,239 3,730,000 50,981 7,007 116,161 6,899 4,275,227 3,853,060 23,015,240 19,382,704 201,147 195,030 23,216,387 19,577,734 27,491,614 23,430,794 401,105 401,105 213,663 213,663 401,105 213,663 27,090,509 23,217,131 10 29,715,384 25,154,568 11(b) 1,220,130 866,797 11(a) (3,845,005) (2,804,234) 27,090,509 23,217,131 The above Statement of Financial Position should be read in conjunction with the accompanying notes. Statement of Changes in Equity for the Year Ended 30 June 2023 Yandal Resources Limited Annual Report 2023 34 Contributed Equity $ Share Based Payments Reserve $ Accumulated Losses $ Total Equity $ Balance at 1 July 2021 19,706,570 608,861 (1,826,006) 18,489,425 Total comprehensive income/ (loss) for the year - Transactions with owners in their capacity as owners: Shares issued during the year Share issue costs Share based payments - performance rights Share based payments - options Balance at 30 June 2022 5,530,751 (82,753) - - 25,154,568 - - - 161,169 96,767 866,797 (978,228) (978,228) - - - - 5,530,751 (82,753) 161,169 96,767 (2,804,234) 23,217,131 Balance at 1 July 2022 25,154,568 866,797 (2,804,234) 23,217,131 Total comprehensive income/ (loss) for the year - Transactions with owners in their capacity as owners: Shares issued during the year Share issue costs Share based payments - performance rights Share based payments - options Balance at 30 June 2023 - - - 39,385 313,948 (1,040,771) (1,040,771) - - - - 5,006,708 (445,892) 39,385 313,948 5,006,708 (445,892) - - 29,715,384 1,220,130 (3,845,005) 27,090,509 The above Statement of Changes in Equity should be read in conjunction with the accompanying notes Statement of Cash Flows for the Year Ended 30 June 2023 CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees Interest received Net cash used in operating activities CASH FLOWS FROM INVESTING ACTIVITIES Payments for property, plant and equipment Payments for acquisition of tenements Capitalised exploration expenditure Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from share issues and exercise of options Share issue costs Proceeds from repayment of secured loan Net cash provided by financing activities Yandal Resources Limited Annual Report 2023 35 Note 2023 $ 2022 $ (744,050) (604,971) 50,929 7,039 18(b) (693,121) (597,932) (61,299) (65,901) (50,230) (116,000) (3,315,763) (9,045,433) (3,442,963) (9,211,663) 5,006,708 5,504,933 (383,385) - (82,753) 70,000 4,623,323 5,492,180 Net increase/(decrease) in cash held Cash and cash equivalents at the beginning of the financial year 487,239 (4,317,415) 3,730,000 8,047,415 Cash and Cash Equivalents at the End of the Financial Year 18(a) 4,217,239 3,730,000 The above Statement of Cash Flows should be read in conjunction with the accompanying notes. Notes to and Forming Part of the Financial Statements 1 GENERAL INFORMATION These financial statements and notes represent those of Yandal Resources Limited (the “Company” or “Entity”). Yandal Resources Limited is a Company limited by shares incorporated and domiciled in Australia. Yandal Resources Limited Annual Report 2023 36 (a) Significant accounting policies Statement of compliance Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions. The financial statements and notes also comply with International Financial Reporting Standards. Basis of preparation The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The financial report has been prepared on an accrual basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. Material accounting policies adopted in preparation of this financial report are presented below and have been consistently applied unless otherwise stated. The presentation currency is Australian dollars. Going concern The Directors believe that it is reasonably foreseeable that the Company will continue as a going concern and that it is appropriate to adopt the going concern basis in the preparation of the financial report after consideration of the following factors: • The Company has cash at bank of $4,217,239 and had net cash outflows from operating activities of $693,121 for the year ended 30 June 2023. As of that date, the Company had net assets of $27,090,509. • The Company raised $5M in capital under a placement and a non-renounceable pro-rata rights issue during the year and Directors are of the view that should the Company require additional capital it has the ability to raise further capital to enable the Company to meet scheduled exploration expenditure requirements and future plans on the development assets; • The Company has the ability to scale back certain parts of their activities that are non-essential so as to conserve cash; and • The Company retains the ability, if required, to wholly or in part dispose of interests in mineral exploration and development assets, and liquid investments. Accordingly, the directors believe that the consolidated entity will be able to continue as a going concern and that it is appropriate to adopt the going concern basis in the preparation of the financial report. Should the Company not achieve appropriate level of funding from some or all of the factors set out above, there is a material uncertainty which may cast significant doubt about whether the Company will continue as a going concern and therefore whether they will realise their assets and extinguish their liabilities in the normal course of business and at the amounts stated in the financial report. The financial report does not include any adjustments relating to the amounts or classification of recorded assets or liabilities that might be necessary if the Company does not continue as a going concern. New accounting standards and interpretations The Company has adopted all of the new or amended Accounting Standards and Interpretations issued by the AASB that are mandatory for the current reporting period. These Standards and Interpretations did not have any material impact on these financial statements. Yandal Resources Limited Annual Report 2023 37 Notes to and Forming Part of the Financial Statements (a) Significant accounting policies continued New Accounting Standards and Interpretations not yet mandatory or early adopted Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the Company for the annual reporting period ended 30 June 2023. The Company has reviewed the new Standards and Interpretations that have been issued but are not yet effective for the year ended 30 June 2023. As a result of this review the Directors have determined that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change is necessary to Company accounting policies. Critical accounting judgements and key sources of estimation uncertainty In the application of IFRS, management is required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstance, the results of which form the basis of making the judgements. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. i) Significant accounting judgements In the process of applying the Company’s accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements: Capitalisation of exploration and evaluation expenditure The Company has capitalised significant exploration and evaluation expenditure on the basis either that this is expected to be recouped through future successful developments (or alternatively sale) of the Areas of Interest concerned or on the basis that it is not yet possible to assess whether it will be recouped. As at 30 June 2023, the carrying value of capitalised exploration expenditure is $23,015,240. Share based payments - performance rights The Company has issued performance rights to their employees and directors. During the year ended 30 June 2023 and an amount of $39,385 was expensed as share based payment. Refer to Note 1(n) for the Share-Based Payments accounting policy and Note 20 for details of the performance rights issued. Share based payments - options The Company has issued unlisted options to their directors, employees and consultants. During the year ended 30 June 2023 an amount of $313,948 was expensed, of which $251,441 was expensed as share based payment and $62,507 was expensed as capital raising costs. Refer to Note 1(n) for the Share-Based Payments accounting policy and Note 20 for details of the options issued. ii) Significant accounting estimates and assumptions The carrying amounts of certain assets and liabilities are often based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are: Impairment of capitalised exploration and evaluation expenditure The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the Company decides to exploit the related lease 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, costs of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 38 (b) Income Tax The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the notional income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity. The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or disallowed items. It is calculated using the tax rates that have been enacted or are substantively enacted by the reporting date. The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the Company will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law. (c) Trade and Other Receivables Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost, less expected credit loss provision. Trade receivables are due for settlement no more than 30 days from the date of recognition. Collectability of trade receivables is reviewed on an ongoing basis. Debts that are known to be uncollectible are written off. A provision for expected credit loss is established when there is an expectation that the Company will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is recognised in the Statement of Profit or Loss and Other Comprehensive Income. (d) Trade and Other Payables These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year and which are unpaid, together with assets ordered before the end of the financial year. The amounts are unsecured and are usually paid within 30 days of recognition. (e) Cash and Cash Equivalents For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions and other short-term, highly liquid instruments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. (f) Comparative Figures Where necessary, comparative figures have been adjusted to conform to the presentation in the current year. (g) Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the statement of comprehensive income over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities, which are not incremental costs relating to the actual draw-down of the facility, are recognised as prepayments and amortised on a straight-line basis over the term of the facility. Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Yandal Resources Limited Annual Report 2023 39 Notes to and Forming Part of the Financial Statements (h) Goods and Services Tax Revenues, expenses and assets are recognised net of the amount of associated goods and services tax (GST), unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the taxation authority, are presented as operating cash flows. (i) Contributed Equity Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of acquisition as part of the purchase consideration. If the entity reacquires its own equity instruments, eg as the result of a share buy-back, those instruments are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the Statement of Profit or Loss and Other Comprehensive Income and the consideration paid including any directly attributable incremental costs (net of income taxes) is recognised directly in equity. (j) Impairment of Assets Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Assets are reviewed for impairment whenever events or changes in circumstances indicate that they might be impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash flows from other assets or groups of assets (cash-generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at each reporting date. (k) Earnings per Share i) Basic earnings per share Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year. ii) Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. (l) Exploration and Evaluation Expenditure Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage which permits reasonable assessment of the economically recoverable reserves. Accumulated costs in relation to an abandoned area are written off in full against operating results in the year in which the decision to abandon the area is made. When production commences the accumulated costs for the relevant area of interest are classified as development costs and amortised over the life of the project area according to the rate of depletion of the economically recoverable reserves. Where independent valuations of areas of interest have been obtained, these are brought to account. Subsequent expenditure on re- valued areas of interest is accounted for in accordance with the above principles. 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. At 30 June 2023 the Directors considered that the carrying value of the mineral tenement interests of the Company was as shown in the Statement of Financial Position and no further impairment arises other than that already recognised. Yandal Resources Limited Annual Report 2023 40 Notes to and Forming Part of the Financial Statements (m) Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances and amounts collected on behalf of third parties. Revenue is recognised for major business activities as follows: i) Interest Income Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets. ii) Other Services Other debtors are recognised at the amount receivable and are due for settlement within 30 days from the end of the month in which services were provided. (n) Share-Based Payments Share-based compensation benefits are provided to employees via the Company’s Employee Incentive Plans. The incentive plans consist of the short term and long term incentive plans for Executive Directors and other Executives and the employee share scheme for all other employees. The fair value of rights granted under the short term and long term incentive plans is recognised as an employee benefits expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the rights granted, which includes any market performance conditions and the impact of any non-vesting conditions but excludes the impact of any service and non-market performance vesting conditions. Non-market vesting conditions and the impact of service conditions are included in assumptions about the number of rights that are expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the number of rights that are expected to vest based on the non-market vesting and service conditions. It recognises the impact of the revision to original estimates, if any, in the statement of comprehensive income, with a corresponding adjustment to equity. The initial estimate of fair value for market based and non-vesting conditions is not subsequently adjusted for differences between the number of rights granted and number of rights that vest. When the rights are exercised, the appropriate amount of shares are transferred to the employee. The proceeds received net of any directly attributable transaction costs are credited directly to equity. The fair value of deferred shares granted to employees for nil consideration under the employee share scheme is recognised as an expense over the relevant service period, being the year to which the incentive relates and the vesting period of the shares. The fair value is measured at the grant date of the shares and is recognised in equity in the share-based payment reserve. The number of shares expected to vest is estimated based on the non-market vesting conditions. The estimates are revised at the end of each reporting period and adjustments are recognised in profit or loss and the share-based payment reserve. (o) Segment Reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as the steering committee that makes strategic decisions. The standard requires a ‘management approach’, under which segment information is presented on the same basis as that used for internal reporting purposes. The segments are reported in a manner that is consistent with the internal reporting provided to the chief operating decision maker. An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components. All operating segments’ operating results are regularly reviewed by the Company’s Managing Director to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. Segment results that are reported to the Managing Director include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly corporate assets (primarily the Company’s headquarters), head office expenses, and income tax assets and liabilities. Notes to and Forming Part of the Financial Statements (o) Segment Reporting continued Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets other than goodwill. Yandal Resources Limited Annual Report 2023 41 (p) Leases The Company assesses at the start of a contract whether or not it contains a lease, by deciding if the contract provides the right to control the use of an identified asset for a period of time in exchange for consideration. The Company currently uses a single recognition and measurement approach for all leases, except for short-term leases and leases of low value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets representing the right to use underlying assets. i) Right-of-use assets The Company recognises right-of-use assets at the start of the lease and are measured at costs, less accumulated depreciation and impairment losses and adjusted for any re-measurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets. ii) Lease liabilities At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments less any lease incentives received, variable lease payments that depend on an index or a rate and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating the lease, if the lease term reflects the Company exercising the option to terminate. Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they are incurred to produce inventories) in the period in which the event or condition that triggers the payment occurs. In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g. changes to future payments resulting from a change in an index or rate used to determine such payments) or a change in the assessment of an option to purchase the underlying asset. iii) Short-term leases and leases of low-value assets The Company applies the short-term lease recognition exemption to its short-term leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. It also applies the lease of low-value assets recognition exemption to leases that are considered to be low value. Lease payments on short-term leases and leases of low-value assets are recognised as an expense on a straight-line basis over the lease term. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 42 2 INCOME AND EXPENSES Revenue from continuing operations: Interest received 2023 $ 2022 $ 57,406 57,406 6,298 6,298 Loss before income tax is arrived at after charging the following items: Superannuation expenses 98,251 120,841 3 INCOME TAX Income tax expense Current tax Deferred tax - - - - - - Numerical reconciliation of income tax expense to prima facie tax payable Profit/(loss) before income tax (1,040,771) (978,228) Tax at 30% (2022: 30%) (312,231) (293,469) Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Tax effect of exploration expenditure claimed Permanent differences Other timing differences Tax losses not recognised as an asset Income Tax Expense / (Benefit) Tax losses and unrecognised temporary differences The Directors estimate that the potential future income tax benefit as at 30 June 2023 in respect of tax losses not brought to account is as follows: Potential future tax benefit – income tax losses Potential future tax benefit – capital losses Potential deferred tax liability – exploration expenditure (1,069,991) (2,645,065) 100,546 (100,547) 90,393 (82,615) 1,382,223 2,930,756 - - 7,891,562 6,495,139 37,620 37,620 (6,628,927) (5,558,937) 1,300,255 973,822 This benefit for tax losses will only be obtained if:  the Company derives income of a nature and amount sufficient to enable the benefit from the deductions for the loss to be realised; the Company continues to comply with the conditions for deductibility imposed by the law; and no changes in tax legislation adversely affect the Company in realising the benefit from the deductions for the losses.   Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 43 4 CURRENT ASSETS – CASH AND CASH EQUIVALENTS Cash at bank Cash at bank carries a floating interest rate of 4% at 30 June 2023 (2022: 0.2%). The above figures are reconciled to the cash at the end of the financial year as shown in the statement of cash flows in Note 18. 5 CURRENT ASSETS – TRADE AND OTHER RECEIVABLES ATO/GST assets Other receivables 6 CURRENT ASSETS - OTHER Prepaid insurance 7 NON-CURRENT ASSETS – CAPITALISED EXPLORATION EXPENDITURE Capitalised exploration and tenement acquisition costs: Carrying amount at the beginning of the year Acquisition of tenements Exploration expenditure capitalised The ultimate recoupment of above expenditure relating to exploration is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest. 8 NON-CURRENT ASSETS – PROPERTY, PLANT AND EQUIPMENT Plant and equipment at cost Less accumulated depreciation Reconciliations: Plant and Equipment Carrying amount at the beginning of the year Additions Depreciation Carrying amount at the end of the year 2023 $ 2022 $ 4,217,239 3,730,000 4,217,239 3,730,000 44,456 6,525 50,981 93,113 23,048 116,161 7,007 7,007 6,899 6,899 19,382,704 10,422,822 65,901 143,000 3,566,635 8,816,882 23,015,240 19,382,704 350,832 (149,685) 201,147 289,532 (94,502) 195,030 195,030 61,299 (55,182) 201,147 208,324 50,230 (63,524) 195,030 Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 44 9 CURRENT LIABILITIES – TRADE AND OTHER PAYABLES Trade payables Accrued expenses Other expenses All amounts are expected to be settled in less than 12 months. 10 CONTRIBUTED EQUITY (a) Ordinary Shares Issued capital 157,803,079 (2022: 116,091,553) ordinary shares fully paid (net of share issue costs) 2023 $ 2022 $ 382,240 18,832 33 131,175 41,782 40,706 401,105 213,663 29,715,384 25,154,568 29,715,384 25,154,568 Number 2023 Number 2022 $ 2023 $ 2022 Movement in issued capital Balance at the beginning of the financial year 116,091,553 100,439,953 25,154,568 19,706,570 Shares issued under a Placement 19,166,667 - 2,300,000 - Shares issued under a non-renounceable pro-rata rights issue 22,542,359 10,702,063 2,705,083 4,280,825 Shares issued from options exercised (refer Note 10b) 2,500 4,889,537 1,625 1,222,926 Shares issued from tenement acquisition Share issue costs - - 60,000 - 27,000 - (445,892) (82,753) Balance at the End of the Financial Year 157,803,079 116,091,553 29,715,384 25,154,568 Terms and condition of contributed equity Ordinary Shares Ordinary shares have no par value. Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company. (b) Options As at 30 June 2023, the following unlisted options were exercised: 2,500 unlisted options – exercisable at 65 cents and expire on 31 December 2022, raising $1,625. As at 30 June 2023, the following unlisted options expired: 5,347,195 unlisted options – exercisable at 65 cents and expire on 31 December 2022. 150,000 unlisted options – exercisable at 30 cents and expire on 1 September 2025 as the conditional rights to these securities had lapsed. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 45 10 CONTRIBUTED EQUITY continued (b) Options continued As at 30 June 2023, the following unlisted options were on issue: Nature Expiry Date Exercise Price of Options Number under Option Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options Unlisted options 31 October 2024 4 April 2025 1 September 2025 1 March 2026 4 April 2026 27 February 2027 1 March 2027 24 cents 50 cents 30 cents 18 cents $1 18 cents 27 cents The weighted average exercise price of options on issue is $0.279 as at 30 June 2023. 22,854,535 1,300,000 350,000 2,000,000 1,300,000 1,000,000 2,000,000 (c) Performance Rights Balance as at 1 July 2021 Additions during the year Cancelled during the year Balance as at 30 June 2022 Balance as at 1 July 2022 Additions during the year Cancelled during the year Balance at 30 June 2023 Refer to note 20(a) for further details. Number 600,000 3,400,000 (1,875,000) 2,125,000 2,125,000 - (1,125,000) 1,000,000 Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 46 2023 $ 2022 $ (2,804,234) (1,826,006) (1,040,771) (978,228) (3,845,005) (2,804,234) 1,220,130 1,220,130 866,797 866,797 866,797 39,385 313,948 1,220,130 608,861 161,169 96,767 866,797 (1,040,771) (978,228) (0.72) cents (0.89) cents (0.72) cents (0.89) cents Number Number 143,575,840 108,862,866 11 (a) ACCUMULATED LOSSES AND RESERVES Accumulated Losses Opening balance Profit/(Loss) for the year Closing Balance (b) Reserves Share based payment reserve (i) (i) Share-Based Payments Reserve The share-based payments reserve is used to recognise the fair value of shares, options and performance rights issued. Balance at beginning of the year Fair value of performance rights granted (refer Note 20(a)) Fair value of options granted (refer Note 20(b) & (c)) Balance at the end of the year 12 EARNINGS/(LOSS) PER SHARE Profit/(loss) after tax attributable to members of Yandal Resources Limited Basic profit/( loss) per share Diluted profit/(loss) per share Weighted average number of ordinary shares outstanding during the year used in the calculation of basic and diluted loss per share. Basic Earnings/(Loss) Per Share Basic earnings/(loss) per share is determined by dividing the loss after income tax attributable to members of Yandal Resources Limited by the weighted average number of ordinary shares outstanding during the financial year, adjusted for any bonus elements in ordinary shares issued during the year. Diluted Earnings/(Loss) Per Share Diluted earnings/(loss) per share adjusts the figures used in the determination of basic earnings per share by taking into account amounts unpaid on ordinary shares and any change in earnings per share that will probably arise from the exercise of options outstanding during the financial year. Where options exercise prices are above market values (out of the money), no dilutive impact arises as it increases the loss per share. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 47 13 REMUNERATION OF AUDITORS Remuneration for audit and review of financial reports by Rothsay Auditing Remuneration for audit and review of financial reports by HLB Mann Judd The Company changed its Auditors effective for year ended 30 June 2022. $2,000 attributed to Rothsay Auditing related to under-accruals in prior years. 14 KEY MANAGEMENT PERSONNEL AND RELATED PARTY DISCLOSURES The persons holding positions as Directors of the Company during the financial year were: Mr Timothy Kennedy Managing Director Mr Gregory Evans Non-Executive Chairman Ms Katina Law Non-Executive Director Other key management personnel There were no other persons who had authority and responsibility for planning, directing and controlling the major activities of the Company, directly or indirectly, during the financial year. (a) Details of remuneration Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or payable to each member of the Company’s Key Management Personnel for the year ended 30 June 2023. The total remuneration paid to Key Management Personnel of the Company and the Company during the year are as follows: Short-term benefits Post-employment benefits Share based payments 2023 $ 2022 $ - 39,979 39,979 2,000 27,820 29,820 402,604 40,100 100,035 542,739 518,052 43,209 146,597 707,858 Other transactions with Director related entities (b) Transactions with related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. Exercise of options by Key Management Personnel (c) There were no other transactions with Key Management Personnel during the year. Yandal Resources Limited Annual Report 2023 48 Notes to and Forming Part of the Financial Statements SEGMENT REPORTING 15 The entity has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources. The entity operates predominantly in one business segment which is gold exploration and predominantly in one geographical area which is Western Australia. The Company is domiciled in Australia. All revenue from external parties in generated from Australia only. All the assets are located in Australia. FINANCE FACILITIES 16 No credit standby facility arrangement or loan facilities existed at 30 June 2023 or 30 June 2022. 17 COMMITMENTS FOR EXPENDITURE Commitments for minimum expenditure requirements on the mineral exploration assets it has an interest in are payable as follows: Within one year Later than one year but not later than five years Later than five years Reconciliation of Cash 18 NOTES TO THE STATEMENT OF CASH FLOWS (a) For the purposes of the statement of cash flows, cash includes cash on hand and in banks and investments in money market instruments, net of outstanding bank overdrafts. Cash at the end of the financial year as shown in the statement of cash flows is reconciled to the related items in the statement of financial position as follows: 2023 $ 2022 $ 1,007,740 870,940 2,009,912 3,218,160 3,986,610 470,700 7,004,262 4,559,800 Cash at bank 4,217,239 3,730,000 (b) Reconciliation of Net Cash Used In Operating Activities To Loss After Income Tax Profit/(loss) after income tax Depreciation Share based payment Movements in: Receivables Tax assets Prepayments Payables Net Cash used in Operating Activities (c) Non cash financing and investing activities There were no non-cash financing and investing activities during the year ended 30 June 2023. (1,040,771) (978,228) 55,183 63,525 290,826 257,936 16,523 48,657 (108) 6,976 123,814 (2,982) (63,431) (68,973) (693,121) (597,932) Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 49 19 FINANCIAL RISK MANAGEMENT AND POLICIES The Company’s exploration activities are being funded by equity and are not exposed to significant financial risks. There are no speculative or financial derivative instruments. Funds are invested for various short term periods to match forecast cash flow requirements. The Company holds the following financial instruments: Financial assets Cash and cash equivalents Receivables Financial liabilities Payables 2023 $ 2022 $ 4,217,239 3,730,000 50,981 116,161 4,268,220 3,846,161 401,105 401,105 213,663 213,663 The Company’s principal financial instruments comprise cash and short-term deposits. The Company does not have any borrowings. The main purpose of these financial instruments is to fund the Company’s operations. The main risks arising from the Company are credit risk, capital risk and liquidity risk. The Board of Directors reviews and agrees policies for managing each of these risks and they are summarised below: Credit risk (a) Management does not actively manage credit risk. The Company has no significant exposure to credit risk from external parties at year end. The maximum exposure to credit risk at the reporting date is equal to the carrying value of financial assets at 30 June 2023. Cash at bank is held with internationally regulated banks. Other receivables are of a low value and all amounts are current. Capital risk (b) The Company’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 50 19 FINANCIAL RISK MANAGEMENT AND POLICIES continued Liquidity risk (c) Maturity profile of financial instruments Prudent liquidity risk management implies maintaining sufficient cash balances and access to equity funding. The Company’s exposure to the risk of changes in market interest rates relate primarily to cash assets and floating interest rates. The Company does not have significant interest-bearing assets and is not materially exposed to changes in market interest rates. The Directors monitor the cash-burn rate of the Company on an on-going basis against budget and the maturity profiles of financial assets and liabilities to manage its liquidity risk. The following table sets out the carrying amount, by maturity, of the financial instruments including exposure to interest rate risk: < 1 month 1 – 3 months 3 months – 1 year 1 – 5 years Over 5 years Total 4,205,519 50,981 4,256,500 401,105 401,105 3,730,000 116,161 3,846,161 213,663 213,663 - - - - - - - - - - 11,720 - 11,720 - - - - - - - - - - - - - - - - - - - - - - - - - - - 4,217,239 50,981 4,268,220 401,105 401,105 3,730,000 116,161 3,846,161 213,663 213,663 Weighted average effective interest rate % 4% - - - - 0.02% - - - - As at 30 June 2023 Financial Assets: Cash Receivables Financial Liabilities: Payables As at 30 June 2022 Financial Assets: Cash Receivables Financial Liabilities: Payables Sensitivity analysis – interest rates The sensitivity effect of possible interest rate movements have not been disclosed as they are immaterial. Net fair value of financial assets and liabilities (d) Unless otherwise stated, the carrying amount of financial instruments reflect their fair value. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 51 20 SHARE BASED PAYMENTS Share based payments expensed to the Statement of Profit or Loss and Other Comprehensive Income during the period: Performance rights reversed (Note 20(a)) Performance rights expensed (Note 20(a)) Options reversed Issue of options (Note 20(b)) – Employees and Directors Issue of options (Note 20 (c)) - Consultants 30 June 2023 $ 30 June 2022 $ (10,108) 49,493 (10,185) 114,114 147,512 290,826 - 161,169 - 96,767 - 257,936 Share based payments expensed as capital raising costs during the year: Issue of options for services provided (Note 20(c)) 62,507 - (a) Performance Rights (i) 30 June 2022 During the year ended 30 June 2022, $161,169 was expensed as a share based payment respect of the Company’s Class A, B, C and D performance rights, with the fair value being recognised over the vesting period. As at 30 June 2023, a total of 1,000,000 performance rights remain unvested. In November 2021, directors were granted a total of 2,100,000 Class B, C and D performance rights. In December 2021, employees were granted a total of 1,300,000 Class C and D performance rights as announced to the ASX on 18 January 2022. The performance rights were granted at nil consideration, do not have an exercise price and will lapse if the vesting conditions are not met. The Performance Rights are issued under the Company’s Employee Incentive Scheme (EIS), dated 19 October 2018 and were approved by shareholders at the General Meeting held on 19 November 2021. The issue to Directors was on 22 November 2021 and the issue to employees was granted on 6 December 2021. Each Performance Right will, at the election of the holder, vest, and convert to one fully paid ordinary share, subject to the satisfaction of certain Performance Conditions. (ii) 30 June 2023 During the year ended 30 June 2023, $49,493 was expensed as a share based payment for the Company’s performance rights issued to directors and employees. An amount of $10,108 was reversed on an employee leaving the Company. In July 2022, Class A and B performance rights granted to directors and employees expired. As at 30 June 2023, a total of 1,000,000 performance rights remained unvested. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 52 20 SHARE BASED PAYMENTS continued Performance Rights continued (a) The terms of the Performance Rights on issue are as follows: Class of Performance Rights Service Condition Performance Condition Class A Performance Rights1 The holder or the holder’s representative remains engaged as an employee until 1 June 2022. Class B Performance Rights1 The holder or the holder’s representative remains engaged as an employee or Director until 1 June 2022. Class C Performance Rights The holder or the holder’s representative remains engaged as an employee or Director until 1 June 2023. Class D Performance Rights The holder or the holder’s representative remains engaged as an employee or Director until 1 June 2024. (a) On or before 1 July 2022 the volume weighted average price of the Company's Shares over 20 consecutive Trading Days on which the Shares trade is $1.00 or more. (a) On or before 1 July 2022 the volume weighted average price of the Company's Shares over 20 consecutive Trading Days on which the Shares trade is $1.00 or more; or (b) On or before 1 July 2022 a Takeover Event occurs where the bidder pays a price of $1.00 or more per Share. (a) On or before 1 July 2023 the volume weighted average price of the Company's Shares over 20 consecutive Trading Days on which the Shares trade is $2.00 or more; or (b) On or before 1 July 2023 a Takeover Event occurs where the bidder pays a price of $2.00 or more per Share. (a) On or before 1 July 2024 the volume weighted average price of the Company's Shares over 20 consecutive Trading Days on which the Shares trade is $3.00 or more; or (b) On or before 1 July 2024 a Takeover Event occurs where the bidder pays a price of $3.00 or more per Share. 1 Class A and B Performance Rights expired on 1 July 2022. Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 53 20 SHARE BASED PAYMENTS continued Performance Rights continued (a) Set out below is a summary of the performance rights on issue: Employees Directors Class A Class C Class D Class B Class C Class D Total Number granted 600,000 650,000 650,000 700,000 700,000 700,000 4,000,000 Grant date 11 Jun 2021 6 Dec 2021 6 Dec 2021 22 Nov 2021 22 Nov 2021 22 Nov 2021 Expiry date of milestone achievements 1 Jul 2022 1 July 2023 1 July 2024 1 Jul 2022 1 Jul 2023 1 Jul 2024 Share price hurdle $1.00 $2.00 $3.00 $1.00 $2.00 $3.00 Fair value per right $0.3077 $0.0699 $0.0949 $0.0969 $0.1043 $0.1291 Number cancelled at 30 June 2021 - N/A N/A N/A N/A N/A - Number cancelled at 30 June 2022 (275,000) (200,000) (200,000) (400,000) (400,000) (400,000) (1,875,000) Number cancelled at 30 June 2023 - (250,000) (250,000) - Number expired at 30 June 2023 (325,000) Number vested at 30 June 2021 Number vested at 30 June 2022 Number vested at 30 June 2023 - - - Number remaining at 30 June 2021 600,000 - N/A - - - - (300,000) - - - - (500,000) (625,000) N/A N/A N/A N/A - - - - - - - - - - - - - - - 600,000 Number remaining at 30 June 2022 325,000 450,000 450,000 300,000 300,000 300,000 2,125,000 Number remaining at 30 June 2023 - 200,000 200,000 - 300,000 300,000 1,000,000 Total fair value at grant date $184,620 $45,435 $61,685 $67,830 $73,010 $90,370 $522,950 Total fair value that would be recognised over the vesting period if rights are vested $100,002 $13,980 $18,980 $29,070 $31,290 $38,730 $232,052 Amount expensed at 30 June 2021 $9,111 - - - - - $9,111 Amount expensed at 30 June 2022 $90,631 $11,328 $9,379 $28,940 $11,847 $9,044 $161,169 Amount expensed at 30 June 2023 $260 $8,158 $6,753 $130 $19,390 $14,802 $49,493 Amount reversed at 30 June 2023 upon cancellation Total fair value still to be recognised at 30 June 2023 if all remaining rights are vested - - ($5,530) ($4,578) $24 $7,426 - - - - ($10,108) $53 $14,884 $22,387 Notes to and Forming Part of the Financial Statements 20 SHARE BASED PAYMENTS continued Performance Rights continued (a) The fair value of the rights was determined using Hoadley’s Barrier 1 model that takes into account the vesting condition of the rights, and was based on the following inputs: Yandal Resources Limited Annual Report 2023 54 Assumptions Spot price Vesting hurdle Exercise price Class A $0.555 $1.00 Nil Employees Class C $0.395 $2.00 Nil Rights Class D $0.395 $3.00 Nil Class B $0.4519 $1.00 Nil Directors Class C $0.4519 $2.00 Nil Class D $0.4519 $3.00 Nil Expiry date 1 July 2022 1 July 2023 1 July 2024 1 July 2022 1 July 2023 1 July 2024 Expected future volatility Risk free rate Dividend yield 85% -0.01% Nil 80% 0.54% Nil 80% 0.89% Nil 80% 0.55% Nil 80% 0.55% Nil 80% 0.95% Nil (b) Options – Employees and Directors (i) 30 June 2023 Employees and Exploration Manager In September 2022, 1,000,000 options were issued to the Company’s employees. 650,000 options were cancelled upon employees leaving the Company. At 30 June 2023, 350,000 options were on hand. These options are exercisable at $0.30 and expire on 1 September 2025. In March 2023, 1,000,000 options were issued to the Company’s Exploration Manager. These options are exercisable at $0.18 and expire 27 February 2027. An amount of $38,216 was expensed for the year ended 30 June 2023 for options issued to employees. Directors During the year ended 30 June 2022, the Company issued options to its directors, Mr Evans and Mr Kennedy. An amount of $65,713 was expensed as a share based payment for the year ended 30 June 2023 (2022: $96,767). Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 55 20 SHARE BASED PAYMENTS continued Options continued (b) Details of the options issued are as follows: Tranche 1 Options Tranche 2 Options Employees Exploration Manager Total Details Unlisted options to be issued for nil consideration. Each option is exercisable into one ordinary share at any time on or before the expiry date. Vesting conditions None Methodology Grant date Vesting date Expiry date Share price at grant date ($) Exercise price ($) Risk-free rate (%) Volatility (%) Dividend yield (%) Fair value per Option ($) Recipient Number Black Scholes 19 May 2022 - 4 April 2025 0.200 0.500 2.901 85 - 0.0668 Unlisted options to be issued for nil consideration. Each option is exercisable into one ordinary share at any time between meeting the vesting conditions and the expiry date. Unlisted options to be issued for nil consideration. Each option is exercisable into one ordinary share at any time on or before the expiry date. Continuous service until 4 April 2023 None Unlisted options issued per Employee Incentive Plan. Each option is exercisable into one ordinary share at any time between meeting the vesting conditions and the expiry date. Continuous service until 27 Feb 2024 Black Scholes 19 May 2022 4 April 2023 4 April 2026 Black Scholes Black Scholes 1 Sept 2022 10 March 2023 - 1 Sept 2025 27 Feb 2024 27 Feb 2027 0.200 1.000 2.901 85 - 0.0582 0.16 0.30 3.33 86.4 - 0.0679 0.093 0.18 3.33 85 - 0.045 Tim Kennedy Gregory Evans Tim Kennedy Gregory Evans Employees Chris Oorschot 1,000,000 300,000 1,000,000 300,000 1,000,000 1,000,000 4,600,000 Total fair value ($) 66,799 20,040 58,185 17,456 67,900 45,676 276,056 Number cancelled at 30 June 2023 Amount reversed at 30 June 2023 upon cancellation Number vested at 30 June 2022 Number vested at 30 June 2023 Number remaining at 30 June 2022 Number remaining at 30 June 2023 Amount expensed to 30 June 2022 Amount expensed to 30 June 2023 Amounts to be expensed in future periods if voting condition is met - - - - 1,000,000 300,000 - - - - - - - - - - (650,000) (44,135) - 350,000 1,000,000 300,000 1,000,000 300,000 - - - - - - (650,000) (44,135) 1,300,000 350,000 2,600,000 1,000,000 300,000 1,000,000 300,000 350,000 1,000,000 3,950,000 66,799 20,040 7,637 2,291 - - 96,767 - - - - 50,548 15,165 23,765 14,451 103,929 - - - 31,225 31,225 Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 56 20 SHARE BASED PAYMENTS continued (c) Options - Consultants Consultants - Capital Raising Services (i) On 30 November 2022, the Company issued 2,000,000 unlisted options to satisfy payment for capital raising services provided by MST Financial Services Pty Ltd. The options are valued at $62,507 and expire on 31 December 2024, with an exercise price of $0.24. This amount has been expensed to capital raising costs. Consultants – Technical Advisor (ii) In March 2023, options were issued to the Company’s technical advisor as part of their remuneration as follows: Tranche 1 • 2,000,000 options with an exercise price of 200% of the 30-day VWAP at the Commencement Date. Options have a 3-year life from the Commencement Date. • Options to vest in 4 equal amounts at the end of each 3-month period from the Commencement Date over the course of the first year. Tranche 2 • 2,000,000 options with an exercise price of 300% of the 30-day VWAP at the Commencement Date. Options have a 4-year life from Commencement Date. • Options to vest in 4 equal amounts at the end of each 3-month period over the course of the second year. The total value of options issued for the year ended 30 June 2023 totalled $147,512. Details of the options issued are as follows: Details Vesting conditions Methodology Grant date Expiry date Share price at Grant date ($) Exercise price ($) Risk free rate (%) Volatility (%) Dividend yield (%) Fair value per option ($) Total fair value ($) Referring to Prospectus dated 13 October 2022, MST will receive options after raising minimum $4.5M and shareholder approval None Black-Scholes 29 Nov 2022 31 Oct 2024 0.12 0.24 3.33% 82% - 0.0313 62,507 Options issued to Technical Advisor, Mr Eduard Eshuys Tranche 1 Tranche 2 None None Black-Scholes Black-Scholes 10 March 2023 10 March 2023 1 March 2026 1 March 2027 0.093 0.18 3.33% 84.5% - 0.0374 74,773 0.093 0.27 3.33% 82.4% - 0.0364 72,739 Notes to and Forming Part of the Financial Statements Yandal Resources Limited Annual Report 2023 57 LEASES 21 This note provides information for leases where the Company is a lessee. The Company applied AASB 16 on its leases as follows: Lease Impact on the Company’s Financial Position or Performance June 2023 Office equipment/photocopiers Lease agreement is on a month by month basis, therefore eligible for short term exemption, no impact. CONTINGENCIES 22 There are no contingent assets or liabilities at reporting date. EVENTS AFTER REPORTING DATE 23 At the date of the Directors’ Declaration no other matter or circumstance has arisen since 30 June 2023 that has significantly affected or may significantly affect the operations, results of those operations, or state of affairs of the Company, subsequent to 30 June 2023. Shareholder Information Additional information required by the Australian Stock Exchange Limited Listing Rules, and not disclosed elsewhere in this report. SHAREHOLDINGS The number of ordinary shares held by the substantial shareholders as at 25 August 2023 were: Yandal Resources Limited Annual Report 2023 58  Gold Road Resources Limited  Regal Funds Management Pty Limited and Associates  Au Xingao Investment Pty Ltd  Mr Kenneth Joseph Hall  Abadi Investments Pty Ltd 27,420,142 23,700,602 23,496,734 10,600,000 7,960,289 UNQUOTED SECURITIES OPTIONHOLDINGS Nature Expiry Date Exercise Price of Options Number under Option Number of Holders Unlisted options 31 October 2024 Unlisted options 4 April 2025 Unlisted options 1 September 2025 Unlisted options 1 March 2026 Unlisted options 4 April 2026 Unlisted options 27 February 2027 Unlisted options 1 March 2027 24 cents 50 cents 30 cents 18 cents $1 18 cents 27 cents 22,854,535 94 1,300,000 350,000 2,000,000 1,300,000 1,000,000 2,000,000 2 2 1 2 1 1 The number of unlisted options with an exercise price $0.24, expiring 31 October 2024 held by the substantial option holders as at 25 August 2023 were: Regal Funds Management Pty Limited and Associates   Au Xingao Investment Pty Ltd  Gold Road Resources Limited  MST Financial Services Pty Ltd  Mr Andrew Rhys Jackson 6,585,424 2,852,377 2,083,334 2,000,000 1,419,112 CLASS OF SHARES AND VOTING RIGHTS As at 25 August 2023, there were 647 holders of the ordinary shares, 103 holders of unlisted options of the Company. The voting rights attached to the shares are: • at a meeting of members or classes of members each member entitled to vote may vote in person or by proxy or by attorney; and • on a show of hands every person present who is a member has one vote, and on a poll every person present in person or by proxy or attorney has one vote for each ordinary share held. DISTRIBUTION OF SHAREHOLDERS (as at 25 August 2023) Category 1 1,001 5,001 10,001 100,001 – – – – – 1,000 5,000 10,000 100,000 over TOTAL HOLDERS Number of Shareholders 45 121 101 268 112 647 The number of shareholders holding less than a marketable parcel as at 25 August 2023 was 275. Shareholder Information Twenty largest shareholders as at 25 August 2023 Yandal Resources Limited Annual Report 2023 59 Name Balance % 1 DGO GOLD PTY LTD [GOLD ROAD RESOURCES LIMITED] 27,420,142 17.38% 2 UBS NOMINEES PTY LTD [REGAL FUNDS] 3 AU XINGAO INVESTMENT PTY LTD 23,700,602 15.02% 23,496,734 14.89% 4 MR KENNETH JOSEPH HALL 10,600,000 5 ABADI INVESTMENTS PTY LTD 6 AVENIRA GOLD PTY LTD 7 CAROLINE HOUSE SUPER FUND PTY LTD 8 MR ANDREW RHYS JACKSON 9 MS RENAE WAINWRIGHT & MR DAVID LAWRENCE HUGHES 10 BILL BROOKS PTY LTD 11 KESLI CHEMICALS PTY LTD 12 HERA INVESTMENTS PTY LTD 13 EST MR PETER PIOTR MACKOW 7,960,289 4,390,932 3,594,191 2,838,224 2,720,000 2,268,550 2,196,126 1,726,720 1,701,265 14 MRS KATINA MARIA ETHEL LAW & MR PETER S LAW 1,659,903 15 MRS MARISA MACKOW 16 B & M LAWS SUPER FUND PTY LTD 17 GARRETT SMYTHE LTD 18 ALIANDA OAKS PTY LTD 19 KATDAR PTY LTD 20 ZINFANDEL EXPLORATION PTY LTD 1,544,638 1,500,000 1,309,560 1,250,000 1,220,000 1,000,000 6.72% 5.04% 2.78% 2.28% 1.80% 1.72% 1.44% 1.39% 1.09% 1.08% 1.05% 0.98% 0.95% 0.83% 0.79% 0.77% 0.63% Total Securities of Top 20 Holdings 124,097,876 78.64% Total of Securities 157,803,079 Shareholder Information Twenty largest optionholders as at 25 August 2023 Name Yandal Resources Limited Annual Report 2023 60 Balance Unlisted Options $0.24 Expiring 31 October 2024 % 1 REGAL FUNDS MANAGEMENT PTY LIMITED AND ASSOCIATES 6,585,424 28.81% 2 AU XINGAO INVESTMENT PTY LTD 2,852,377 12.48% 3 DGO GOLD PTY LTD [GOLD ROAD RESOURCES LIMITED] 4 MST FINANCIAL SERVICES PTY LTD 5 MR ANDREW RHYS JACKSON 6 MR KENNETH JOSEPH HALL 7 MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED 8 CAROLINE HOUSE SUPER FUND PTY LTD 8 CEDARFIELD HOLDINGS PTY LTD 9 KESLI CHEMICALS PTY LTD 9 ALIANDA OAKS PTY LTD 10 CITICORP NOMINEES PTY LIMITED 11 BILL BROOKS PTY LTD 12 MR SANDOR HELBY 13 POCO ASINO INVESTMENTS PTY LTD 14 ALTOR CAPITAL MANAGEMENT PTY LTD 15 BILL BROOKS PTY LTD 16 MRS KATINA MARIA ETHEL LAW & MR PETER S LAW 17 GARRETT SMYTHE LTD 18 GEE NOMINEES PTY LTD 19 SUPERHERO SECURITIES LIMITED 20 PDFX CONSULTING PTY LTD 20 RIYA INVESTMENTS PTY LTD 2,083,334 2,000,000 1,419,112 1,000,000 837,347 833,334 833,334 625,000 625,000 453,148 416,667 279,237 278,977 223,182 184,435 134,952 106,469 104,167 100,023 100,000 100,000 9.12% 8.75% 6.21% 4.38% 3.66% 3.65% 3.65% 2.73% 2.73% 1.98% 1.82% 1.22% 1.22% 0.98% 0.81% 0.59% 0.47% 0.44% 0.44% 0.44% 0.44% Total Securities of Top 20 Holdings 22,175,519 97.03% Total of Securities 22,854,535 Tenement Schedule Locality Tenement ID Holder Yandal Resources Limited Annual Report 2023 61 Beneficial Ownership of Yandal Resources Ltd Notes Ironstone Well Gold Project Oblique/Quarter Moon Flushing Meadows Ironstone Well Ironstone Well Ironstone Well Ironstone Well Ironstone Well Ironstone Well Flushing Meadows Flushing Meadows Barwidgee Gold Project New England New England New England Mazzucco Greenstone Hill Tuscana Mt McClure Gold Project Success Parmelia Challenger Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Success Mt McClure Mt McClure Mt McClure E53/1882 E53/1963 Yandal Resources Limited Yandal Resources Limited M53/1093 Yandal Resources Limited ELA53/2191 Yandal Resources Limited ELA53/2192 Yandal Resources Limited ELA53/2193 Yandal Resources Limited ELA53/2194 Yandal Resources Limited ELA53/2295 Yandal Resources Limited LA53/222 Yandal Resources Limited MLA53/1108 Yandal Resources Limited E53/1843 P53/1638 P53/1639 P53/1704 P53/1714 P53/1715 M36/691 M36/692 M36/693 P36/1892 P36/1893 P36/1894 P36/1895 P36/1896 P36/1922 PLA36/1934 PLA36/1935 PLA36/1936 Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Tenement Schedule Locality Tenement ID Holder Mt McClure Gold Project continued Yandal Resources Limited Annual Report 2023 62 Beneficial Ownership of Yandal Resources Ltd Notes Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Mt McClure Gordons Gold Project Mt Jewell Mt Jewell Mulgarrie Gordons Wild Dog Mt Vetters Gordons Mulgarrie Gordons Gordons Mt Jewell PLA36/1937 Yandal Resources Limited PLA36/1938 Yandal Resources Limited PLA36/1939 Yandal Resources Limited PLA36/1940 Yandal Resources Limited PLA36/1941 Yandal Resources Limited PLA36/1942 Yandal Resources Limited PLA36/1943 Yandal Resources Limited PLA36/1944 Yandal Resources Limited PLA36/1945 Yandal Resources Limited PLA36/1946 Yandal Resources Limited E24/198 E27/536 E27/570 E27/601 E27/602 E27/605 Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited M27/11 Yandal Resources Limited M27/237 Yandal Resources Limited M27/502 Yandal Resources Limited P26/4577 Yandal Resources Limited P27/2206 Yandal Resources Limited Boomerang Dam P27/2214 Yandal Resources Limited Gordon North Gordon North Gordon North Gordon North Mulgarrie Kanowna Mt Eba P27/2216 Yandal Resources Limited/Moho P27/2217 Yandal Resources Limited/Moho P27/2218 Yandal Resources Limited/Moho P27/2226 Yandal Resources Limited/Moho P27/2234 Yandal Resources Limited P27/2325 Yandal Resources Limited P27/2331 Yandal Resources Limited Called Back Leases P27/2332 Yandal Resources Limited Gordons P27/2338 Yandal Resources Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 1 1 1 1 Tenement Schedule Locality Tenement ID Holder Gordons Gold Project continued Yandal Resources Limited Annual Report 2023 63 Beneficial Ownership of Yandal Resources Ltd Notes Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons Gordons White Dam White Dam P27/2339 P27/2340 P27/2341 Yandal Resources Limited Yandal Resources Limited Yandal Resources Limited P27/2342 Yandal Resources Limited P27/2343 Yandal Resources Limited P27/2344 Yandal Resources Limited P27/2345 Yandal Resources Limited P27/2346 Yandal Resources Limited P27/2354 Yandal Resources Limited P27/2355 Yandal Resources Limited P27/2356 Yandal Resources Limited P27/2357 Yandal Resources Limited P27/2358 Yandal Resources Limited P27/2359 Yandal Resources Limited P27/2360 Yandal Resources Limited P27/2361 Yandal Resources Limited P27/2362 Yandal Resources Limited P27/2363 Yandal Resources Limited P27/2364 Yandal Resources Limited P27/2456 Yandal Resources Limited/Moho P27/2461 Yandal Resources Limited LA27/100 Yandal Resources Limited LA27/101 Yandal Resources Limited MLA27/518 Yandal Resources Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% E26/229 Yandal Resources Limited 100% 1 Notes: 1. These tenements are the subject of the Moho Resources Limited Heads of Agreement dated 10 November 2021.

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