GGP Annual Report

[DipSard]

GGP 2022 ANNUAL REPORT HIGHLIGHTS

Link to full report and some quick highlights:
https://greatlandgold.com/wp-content/up ... e-2022.pdf

HAV JV
In March 2022, Greatland independently updated the Havieron Mineral Resource which demonstrated a substantial increase to the Resource and Reserve announced in the maiden PFS, reflecting an additional 10 months of consistently impressive drilling results. This update increased the Mineral Resource estimate from 4.4 million gold equivalent ounces outlined in the PFS to 6.5 million ounces of gold equivalent, an increase of almost 50% and highlighted an 86% conversion of resource to reserve reinforcing the quality of the Havieron asset and demonstrating a significant annual growth rate of Havieron.

For the first time, material from the Eastern Breccia was included in the mineral resource estimate reflecting the expansion of the Havieron system. In addition, the Board is delighted that Greatland will retain 30% ownership in the Company’s flagship asset on conclusion of the 5% option process under the Havieron Joint Venture agreement. We believe this outcome delivers substantial medium and long-term value to Greatland.

Infill and growth drilling continued during the year and has returned excellent results demonstrating continuity of high-grade mineralisation at Havieron with expansion of the mineralisation across all four current zones – South East Crescent, Eastern Breccia, North West Crescent and Northern Breccia. Drilling reinforced the potential for the Eastern Breccia corridor to host crescent style high grade mineralisation. Havieron remains open laterally and at depth.

DECLINE - the ground conditions improved during the last quarter and subsequent to the year end the improved conditions have enabled first full face blast allowing for a notable acceleration of the decline advancement. The first ventilation shaft blind bore was completed marking a major milestone which significantly reduces the risk to future ventilation shaft construction. Work on the Feasibility Study (“FS”) continued during the year along with concurrent studies assessing growth options for Havieron. The FS is planned to be extended to allow further time to maximise value and de-risk the project.

JURI JV
We are making great progress at the Company’s second joint venture with Newcrest – Juri (“Juri JV”) where the first year exploration programme was completed and results revealed the discovery of broad intersections and continuity of gold mineralisation at Black Hills. The results of the exploration programme along with conducting geophysical surveys and other tests have been valuable to refine and assess new targets for the second year programme, currently underway. Newcrest has advanced the Juri JV to Stage 2, which enables a potential increase in Newcrest’s investment in the programme without the need for Greatland to self-fund these activities.

SCALLYWAG
We remain excited by several other 100% owned prospects that display similar geophysical characteristics to the Havieron gold-copper deposit, particularly in the Paterson region. At Scallywag, adjacent to the Havieron project, exploration drilling completed during the year identified gold mineralisation had been intercepted in four of the seven holes. Adding to this, electromagnetic testing identified new conductor targets which further increases our confidence regarding prospectivity for finding mineralised systems at Scallywag

OTHER PATERSON
In addition, aero magnetic testing across our expanded footprint in the Paterson region has uncovered strong gravity and near coincident magnetic anomalies at the 100% owned Canning and Paterson South licences. Both targets are analogous to the magnetic and gravity anomaly associated with the Havieron gold-copper deposit, and follow-up exploration is warranted.

The Group significantly expanded its footprint in the Paterson province after agreement was reached with Province Resources Limited to acquire the 100% owned Pascalle tenement, the 100% owned Taunton tenement plus applications for two exploration licences. This enabled the Group to expand its position in the Paterson province to more than 1,000 square kilometres, including a prospective area strategically located between Havieron and Telfer.

A second tenement along trend to the northwest of Scallywag (Wanman licence E45/6134) was applied for during the period. The ballot process was decided in the Company’s favour and the tenure has progressed to negotiation of a land access agreement.

ERNEST GILES PROJECT, WESTERN AUSTRALIA
During the year, Greatland refined its geological interpretation and identified targets with settings strongly indicating Mt Magnet style mafic BIF, Wallaby style syenite and typical Yilgarn style greenstone deposits within the previously tested Meadows prospect. Follow up drilling and geophysical surveys have been planned to test these targets. During the period the Company also continued positive ongoing Native Title land access agreement negotiations with traditional owners.

PANORAMA PROJECT, WESTERN AUSTRALIA
During the period, Greatland engaged external consultants to complete processing and interpretation of the Airborne Electro-Magnetic (“AEM”) survey previously completed. This work identified fifteen priority targets from a total of twenty eight discrete anomalies. Twelve of these are associated with Ni prospective mafic-ultramafic rocks. In addition, several of the previous surface sampling anomalies identified pathfinder geochemical targets. A programme of surface geology mapping and soil sampling has been planned for nine distinct areas, encompassing the AEM. A native title land access agreement was successfully negotiated and signed with the Palyku group allowing immediate access to the ground.

BROMUS PROJECT, WESTERN AUSTRALIA
During the period, Greatland identified an RC drill target based on soil sampling which returned anomalous Cu, Zn and Ag coincident with an airborne EM anomaly. A surface sampling program is also recommended to follow up anomalous gold in soils in the north of the Bromus tenement. Greatland also advanced land access negotiations.

FIRETOWER PROJECT, TASMANIA
During the period Greatland undertook Short Wave Infrared (SWIR) logging of its completed diamond and RC drilling in order to refine the alteration interpretation and vector to high grade mineralisation. A two-year extension of term was applied for and granted.

SUSTAINABILITY
On 5 May 2022, the Group published its first Sustainability Report, a current state assessment of material items related to environmental, social and governance ESG matters. This assessment reveals a combination of values orientation together with a compliance driven approach and forms a baseline to define a roadmap, enabling our business operations to enhance our sustainability footprint.

CORPORATE
During the year, Greatland was recognised and awarded the winner of the 2021 Commodity Discovery Fund award for its Havieron discovery, tremendous recognition of Greatland’s exploration team. The Group’s financial position was fortified during and post year end. A combination of fundraises, including proceeds raised from new cornerstone investment partners allowed the Company to secure a total of £11.9 million during the year, with an additional £29.7 million raised in August 2022.

In September 2022, Greatland executed a debt commitment letter with a syndicate of leading international banks of A$220 million (£130 million) and an equity investment by Wyloo Metals of an initial strategic equity subscription of A$60 million (£35 million) plus an option to acquire up to an additional £35 million of Greatland shares at £0.1 per share.

As announced on 14 July 2022, Greatland successfully renegotiated the contingent consideration due under the original 2016 Havieron acquisition, agreeing with the vendor to issue a reduced number of shares and impose a two-year restriction on the dealing of these shares. This reflects the vendor’s support for Greatland and conviction in Havieron.

Subsequent to the year end, Greatland further strengthened its Board capability announcing the intention of three transformational appointments of Australian corporate and mining industry leaders to assist the Company in fulfilling its ambition to be a world class resource development company. James ‘Jimmy’ Wilson, a former senior executive at BHP including the former President of its iron ore division, joined as Executive Director on 12 September 2022. Mark Barnaba, eminent natural resources investment banker and Deputy Chair of A$50 billion ASX-listed Fortescue Metals Group Ltd will join as Non-Executive Chairman on or before 1 January 2023, at which time I will assume a senior Non-Executive role, and Elizabeth Gaines, former Fortescue CEO and Managing Director will join as a Non-Executive Director and Deputy Chair on or before 1 January 2023.

RESULTS AND DIVIDENDS
• Net loss after tax of £11,365,645 (2021: £5,519,648);
• Operating cash outflow of £5,961,397 (2021: £ 2,695,685);
• Net assets of £5,725,602 (2021: £4,154,893), with cash of £10,386,473 as at 30 June 2022 (2021: £6,212,057)

GOING CONCERN
The Group has incurred a loss before tax of £11,365,645 (2021: £5,519,648) and had a net cash outflow of £34,932,650 (2021: £16,266,226) from operating and investing activities. At reporting date there were net current assets of £14,831,306 (2021: £7,134,881), with cash of £10,386,473 (2021: £6,212,057).

The loss resulted from exploration and administrative related costs, and an unrealised foreign exchange loss of £2,735,818 from the loan held by the Australian subsidiary with Newcrest Operations Limited in respect of the Havieron Joint Venture. Subsequent to the year end, the Group’s financial position was strengthened from the issuance of new shares in August 2022. The fundraise experienced strong demand with total gross proceeds raised of £29.7 million.

In addition, the Company announced on 12 September 2022 the execution of a debt commitment letter of A$220 million (£130 million) and equity agreement with Wyloo Metals of an initial strategic equity subscription of A$60 million (£35 million) plus an option to acquire up to an additional £35 million of Greatland shares at £0.1 per share.

As such, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. In addition, the Group is able to significantly reduce expenditure on its own exploration programmes if it wishes to do so.

The Group also has the ability to raise capital for expansion purposes if required, and has demonstrated an ability to do so in the past. Having prepared forecasts based on current resources and assessing methods of obtaining additional finance, the Directors believe the Group has sufficient resources to meet its obligations for the foreseeable future.

KEY PERFORMANCE INDICATORS - SEVEN KPI’S
• Total Shareholder Return (“TSR”) measured over preceding three years against the VanEck Junior Gold Miners ETF (“GDXJ")
o TSR performance for the financial year 2022 was negative 45%, compared to negative 33% for GDXJ. The TSR performance over the preceding three years is a performance target for the Group’s Long Term Incentive Plan.

• ESG Sustainability Report
o In May 2022, the Group published its first Sustainability Report. This assessment reveals a compliance driven approach to ESG and forms a baseline to business operations to enhance our sustainability footprint.

• Safety Performance
o Greatland achieved its goal of maintaining a safe workplace for all. There were no fatalities at the Company’s projects during the year (2021: nil).

• Fund Greatland’s share of the Havieron Joint Venture development costs to first production
o The Company focused on securing a debt commitment letter and raising additional capital through the issuance of new shares. In August 2022, the Company raised £29.7 million through the issuance of new shares. Subsequently Greatland executed a debt commitment letter with a syndicate of leading international banks of A$220 million (£130 million) and an equity investment by Wyloo Metals of an initial strategic equity subscription of A$60 million (£35 million).

• JORC Resource
o In March 2022, the Company announced an independently verified update to the Mineral Resource and Reserves to the Pre-Feasibility Study, reflecting an additional 10 months of impressive drilling results. The Mineral Resource increased by 50% to 5.5Moz Au and 218Kt Cu and Reserve increased to 2.4Moz Au and 109Kt Cu.

• Advancement of Feasibility Study for Havieron
o The Feasibility Study for the Havieron project continued during the year and explored further options for project objectives and consideration of various factors including but not limited to environmental, social and economic impacts.

• Corporate development activity
o Ongoing corporate activity was undertaken during 2022, including marketing activity, progressing options to undertake a cross listing onto the Australian Stock Exchange and consideration and analysis of potential merger and acquisition opportunities.

REMUNERATION COMMITTEE
Annual Bonus Bonus awards are assessed on overall business and individual performance. Executive Directors and senior management remuneration packages are heavily linked to performance criteria, to incentivise daily conduct in alignment with the best interests of shareholders.

The level of bonus is determined on an annual basis considering performance conditions and measures as deemed appropriate. Adjusted based on performance and is generally in the range of 5-60%. In the current year the range was 10-60%. The portion of bonus earned in any one year depends on the Committee’s assessment of each individual’s performance and the overall performance of the Company against predetermined targets for the year, as well as achievements.

EXECUTIVE DIRECTOR SERVICE CONTRACTS
Shaun Day, Managing Director, currently has an employment contract which may be terminated by either party with up to 6 months’ notice.

IMPLEMENTATION OF REMUNERATION POLICY FOR THE YEAR ENDED 30 JUNE 2022
Over the course of the financial year, the following key changes to Directors’ remuneration have been implemented:

• Increase in the fixed compensation of the Managing Director from A$450,000 (£245,475) per annum to A$675,000 (£368,213) per annum. The Committee recognises that this is a significant yearly increase. This decision was taken following consideration of relevant market benchmarks against comparable roles at comparable companies of similar size and complexity, and to reflect personal performance and Group achievement since appointment;

• No material changes to Non-Executive Director fees.

FULL REPORT
https://greatlandgold.com/wp-content/up ... e-2022.pdf

DOWNLOAD LINK
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