CONSTELLATION RESOURCES LIMITED — Interim / Quarterly Report 2022

Feb 21, 2022

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CONSTELLATION RESOURCES LIMITED INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2021

ABN: 57 153 144 211

CORPORATE DIRECTORY

DIRECTORS:

DIRECTORS: Mr Ian Middlemas – Chairman Mr Peter Woodman – Managing Director Mr Peter Muccilli – Technical Director Mr Robert Behets – Non-Executive Director Mr Mark Pearce – Non-Executive Director COMPANY SECRETARY: Mr Lachlan Lynch REGISTERED AND PRINCIPAL OFFICE: Level 9, 28 The Esplanade, Perth WA 6000 Tel: +61 8 9322 6322 Fax: +61 8 9322 6558 AUDITOR: William Buck Audit (WA) Pty Ltd SOLICITORS: Thomson Geer BANKERS: Australia and New Zealand Banking Group Limited National Australia Bank STOCK EXCHANGE LISTING: Australian Securities Exchange Fully Paid Ordinary Shares (ASX Code: CR1 ) SHARE REGISTER: Automic Registry Services Level 5, 191 St Georges Terrace Perth WA 6000 AUSTRALIA Tel: 1300 288 664

CONTENTS	Page
Directors' Report	1
Auditor's Independence Declaration	5
Statement of Profit or Loss and Other Comprehensive Income	6
Statement of Financial Position	7
Statement of Changes in Equity	8
Statement of Cash Flows	9
Notes to the Financial Statements	10
Directors' Declaration	16
Independent Auditor's Review Report	17

DIRECTORS’ REPORT

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The Directors of Constellation Resources Limited present their report on the Company (the “ Company ” or “ Constellation ”) for the half year ended 31 December 2021.

DIRECTORS

The names and details of the Company's directors in office at any time during, or since the end of, the half year are as follows:

Current Directors Mr Ian Middlemas Chairman Mr Peter Woodman Managing Director Mr Peter Muccilli Technical Director Mr Robert Behets Non-Executive Director Mr Mark Pearce Non-Executive Director

Unless otherwise stated, Directors held their office from 1 July 2021 until the date of this report.

PRINCIPAL ACTIVITIES

The principal activity of the Company during the half year consisted of the exploration for minerals, including the Orpheus Project.

OPERATING AND FINANCIAL REVIEW

Operations

Orpheus Project – Fraser Range

Highlights during and subsequent to the end of the half year include:

• Air-Core (“AC”) drilling results to date have defined a highly prospective nickel-copper-cobalt-PGE (“Ni-Cu-CoPGE”) geochemical target that is interpreted to be over three kilometres in strike and up to 300 metres wide – named the “Eyre Anomaly”.

• Strong evidence indicates magmatic nickel sulphides being the source of the Eyre Anomaly with optical petrological analysis confirming trace levels of magmatic nickel-copper sulphides in various holes along the trend.

• A diamond drilling program over the Eyre South Prospect completed during the half year encountered trace levels of magmatic nickel and copper sulphides over several intervals, hosted in thick units of olivine bearing pyroxenites and gabbronorites.

• Planned works in the Fraser Range in early 2022 includes additional AC drilling programs at the Eyre and Wylie prospects and reverse circulation (“RC”) drilling at the McPherson prospect on the Company’s southern tenements.

• Cash at bank of $4.4 million and no debt as of 31 December 2021, well-funded for planned activities.

The Company operates the Orpheus Project (Figure 1), comprising six tenements covering approximately 443km[2] in the Fraser Range province of Western Australia. In the Fraser Range, certain Proterozoic mafic/ ultramafic intrusion suites are prospective to host nickel-copper sulphide mineralisation. The region is currently experiencing high levels of exploration activity for nickel following the Nova, Silver Knight, Mawson and Lantern discoveries.

The Orpheus Project includes a 70% interest in three mineral exploration licences (E28/2403, E63/1281 and E63/1282) and one mineral exploration licence application (E63/1695). The granted exploration licences form part of a joint venture between the Company (70%) and Enterprise Metals Limited (“Enterprise”) (30%, ASX: ENT). Pursuant to the joint venture agreement, the Company is responsible for sole funding all joint venture activities on the tenements, which form part of the joint venture, up to completion of a bankable feasibility study.

Additionally, the Company has further 100% interests in two exploration licences (E28/2738 and E28/2957).

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 1

DIRECTORS’ REPORT (Continued)

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OPERATING AND FINANCIAL REVIEW (Continued)

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Figure 1: Tenement Plan – Orpheus Project.

As at the date of this report, the Company has an interest in the following projects:

Project Name	Permit Number	Percentage Interest	Status
Fraser Range, Western Australia	E63/1281	70%	Granted
	E63/1282	70%	Granted
	E28/2403	70%	Granted
	E63/1695	70%	Application
	E28/2738	100%	Granted
	E28/2957	100%	Granted

Business Development

Several opportunities have been reviewed during the half year, and the Company will continue in its efforts to identify and acquire suitable new business opportunities in the resources sector, both domestically and overseas. However, no agreements have been reached or licences granted and the Directors are not able to assess the likelihood or timing of a successful acquisition or grant of any opportunities.

Corporate

During the half year, 13,847,906 options were exercised raising $2,799,581.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 2

DIRECTORS’ REPORT (Continued)

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Results of Operations

The net loss of the Company for the half year ended 31 December 2021 was $1,170,314 (31 December 2020: $896,374). This loss is predominately comprised exploration and evaluation expenditure of $918,082 (31 December 2020: $583,954) attributable to the Company’s accounting policy of expensing exploration and evaluation expenditure (other than expenditures incurred in the acquisition of the rights to explore) incurred by the Company. In the current half year, the net loss also includes share based payments expenses totalling $10,323 (31 December 2020: $98,086) relating to incentive options. The fair value of the incentive options is recognised over the vesting period of the option.

Financial Position

As at 31 December 2021, the Company had a net current asset surplus of $4,405,632 (30 June 2021: net current asset surplus of $2,765,807). At 31 December 2021, the Company had cash reserves of $4,437,949 (30 June 2021: $2,937,105) and nil borrowings (30 June 2021: nil). At 31 December 2021, the Company had net assets of $4,759,500 (30 June 2021: net assets of $3,121,137) with the increase of $1,638,363 driven predominately by cash inflows from the exercise of options during the period of $2,799,581 offset by the loss for the half year of $1,170,314.

SIGNIFICANT EVENTS AFTER THE REPORTING DATE

As at the date of this report, there are no matters or circumstances which have arisen since 31 December 2021 that have significantly affected or may significantly affect:

• the operations, in financial years subsequent to 31 December 2021, of the Company;

• the results of those operations, in financial years subsequent to 31 December 2021, of the Company; or

• the state of affairs, in financial years subsequent to 31 December 2021, of the Company.

AUDITOR'S INDEPENDENCE DECLARATION

The lead auditor's independence declaration for the half year ended 31 December 2021 required under s307C of the Corporations Act 2001 has been received and can be found on page 5 of the Directors' Report.

This report is made in accordance with a resolution of the Directors.

For and on behalf of the Directors,

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PETER WOODMAN Managing Director

22 February 2022

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 3

DIRECTORS’ REPORT (Continued)

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COMPETENT PERSONS STATEMENT

The information in this report that relates to Exploration Results is extracted from the following ASX announcements:

• “Initial Fraser Range Diamond Drilling Completed” – dated 23 November 2021;

• “ Diamond Drilling to Test Fraser Range Nickel Sulphide Target ” – dated 22 September 2021;

• “Drilling Results Confirm Trace Magmatic Nickel Sulphides” – dated 20 July 2021;

• “Trace Magmatic Nickel Sulphides in Multiple Drill Holes” - dated 22 April 2021;

• “Exploration Identifies Three Kilometre Ni-Cu-Co-PGE Target” – dated 19 January 2021;

• “ Trace Magmatic Nickel Sulphides Intersected in AC Drilling ” – dated 8 December 2020; and

• “ Aircore Drilling Identifies Anomalous Nickel-Copper-Cobalt ” – dated 14 July 2020.

These announcements are available to view at the Company’s website on www.constellationresources.com.au. The information in the original ASX Announcements that related to Exploration Results was based on, and fairly represents information compiled by Peter Muccilli, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Muccilli is a Technical Director of Constellation Resources Limited and a holder of options in Constellation Resources Limited. Mr Muccilli has sufficient experience that is relevant to the styles of mineralisation and types of deposit under consideration, and to the activity being undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). The Company confirms that it is not aware of any 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

Statements regarding plans with respect to Constellation’s project are forward-looking statements. There can be no assurance that the Company’s plans for development of its projects will proceed as currently expected. These forward-looking statements are based on the Company’s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of the Company, which could cause actual results to differ materially from such statements. The Company makes no undertaking to subsequently update or revise the forward-looking statements made in this announcement, to reflect the circumstances or events after the date of that announcement.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 4

AUDITOR’S INDEPENDENCE DECLARATION

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Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 5

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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		Half Year	Half Year
		Ended 31	Ended 31
		December	December
		2021	2020
	Notes	$	$
Interest Income		8,354	14,248
Other Income		-	52,524
Exploration and evaluation expenses		(918,082)	(583,954)
Administration expenses		(240,263)	(281,106)
Business development expenses		(10,000)	-
Share based payments expenses	6	(10,323)	(98,086)
Loss before income tax		(1,170,314)	(896,374)
Income tax expense		-	-
Loss for the half year		(1,170,314)	(896,374)
Loss attributable to members of Constellation Resources Limited		(1,170,314)	(896,374)
Other comprehensive income, net of income tax:
Items that may be reclassified subsequently to profit or loss		-	-
Other comprehensive income for the half year, net of tax		-	-
Total comprehensive loss for the half year		(1,170,314)	(896,374)
Total comprehensive loss attributable to members of Constellation Resources Limited		(1,170,314)	(896,374)
Loss per share attributable to the ordinary equity holders of
the Company
Basic and diluted loss per share (cents per share)	8	(2.45)	(2.56)

The accompanying notes form part of these financial statements.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 6

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2021

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		31 December 2021	30 June 2021
	Notes	$	$
ASSETS
Current Assets
Cash and cash equivalents		4,437,949	2,937,105
Other receivables		37,330	16,307
Total Current Assets		4,475,279	2,953,412
Non-Current Assets
Property, plant and equipment		3,868	5,330
Exploration and evaluation assets	4	350,000	350,000
Total Non-Current Assets		353,868	355,330
TOTAL ASSETS		4,829,147	3,308,742
LIABILITIES
Current Liabilities
Trade and other payables		44,248	164,983
Provisions		25,399	22,622
Total Current Liabilities		69,647	187,605
TOTAL LIABILITIES		69,647	187,605
NET ASSETS		4,759,500	3,121,137
EQUITY
Contributed equity	5	9,717,832	6,885,690
Reserves	6	1,378,540	1,402,005
Accumulated losses		(6,336,872)	(5,166,558)
TOTAL EQUITY		4,759,500	3,121,137

The accompanying notes form part of these financial statements.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 7

STATEMENT OF CHANGES IN EQUITY

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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				Share
				Based	Other
		Contributed	Accumulated	Payment	Equity	Total
		Equity	Losses	Reserve	Reserve	Equity
	Notes	$	$	$	$	$
2021
Balance at 1 July 2021		6,885,690	(5,166,558)	201,857	1,200,148	3,121,137
Net loss for the halfyear		-	(1,170,314)	-	-	(1,170,314)
Total comprehensive income/(loss) for the halfyear		-	(1,170,314)	-	-	(1,170,314)
Transactions with owners in their
capacity as owners
Issue of shares on exercise of options	5	2,799,581	-	-	-	2,799,581
Share issue costs	5	(1,227)	-	-	-	(1,227)
Transfer from SBP reserve		33,788	-	(33,788)	-	-
Share basedpayments expense	6	-	-	10,323	-	10,323
Balance at 31 December 2021		9,717,832	(6,336,872)	178,392	1,200,148	4,759,500
2020
Balance at 1 July 2020		6,625,805	(3,485,488)	111,120	1,200,148	4,451,585
Net loss for the halfyear			(896,374)	-	-	(896,374)
Total comprehensive income/(loss) for the halfyear		-	(896,374)	-	-	(896,374)
Transactions with owners in their
capacity as owners
Share based payments expense		-	-	98,086	-	98,086
Issue of shares upon exercise of
options		3,333	-	-	-	3,333
Balance at 31 December 2020		6,629,138	(4,381,862)	209,206	1,200,148	3,656,630

The accompanying notes form part of these financial statements.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 8

STATEMENT OF CASH FLOWS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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		Half Year	Half Year
		Ended 31	Ended 31
		December	December
		2021	2020
	Notes	$	$
Operating activities
Interest received from third parties		8,362	18,440
COVID-19 cash flow boost	3	-	66,868
Payments to employees and suppliers		(1,305,872)	(935,314)
Net cash flows used in operating activities		(1,297,510)	(850,006)
Investing activities
Purchase of property, plant and equipment		-	(5,598)
Net cash flows used in investing activities		-	(5,598)
Financing activities
Proceeeds from issue of ordinary shares on exercise of options	5	2,799,581	3,333
Share issue costs	5	(1,227)	-
Net cash flows from financing activities		2,798,354	3,333
Net increase/(decrease) in cash and cash equivalents		1,500,844	(852,271)
Cash and cash equivalents at the beginning of the half year		2,937,105	4,313,710
Cash and cash equivalents at the end of the half year		4,437,949	3,461,439

The accompanying notes form part of these financial statements.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 9

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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CORPORATE INFORMATION

Constellation Resources is a Company limited by shares, incorporated and domiciled in Australia whose shares are publicly traded. The principal activity of the Company during the half year consisted of the exploration for minerals, including the Orpheus Project. The financial report of the Company for the half year ended 31 December 2021 was authorised for issue in accordance with a resolution of the Directors on 22 February 2022.

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of Preparation

This general purpose financial report for the interim half year reporting period ended 31 December 2021 has been prepared in accordance with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Act 2001. This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2021 and any public announcements made by Constellation Resources Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The financial report is a general purpose financial report which has been prepared in accordance with AASB 134 as issued by the Australian Accounting Standards Board and the Corporations Act 2001. For the purposes of preparing the financial statements, the Company is a for-profit entity. The principal accounting policies adopted in the preparation of the financial report have been consistently applied to all the periods presented, unless otherwise stated. The significant accounting judgements, estimates and assumptions adopted in the half-year financial report are consistent with those applied in the preparation of the Company’s annual financial report for the year ended 30 June 2021, except for those that have arisen as a result of new standards, amendments to standards and interpretations effective from 1 July 2021.

(b) Statement of Compliance

The financial report complies with AASB 134 which ensures compliance with International Financial Reporting Standard (“IFRS”) IAS 34 “ Interim Financial Reporting ” as issued by the International Accounting Standards Board.

In the current half year, the Company has adopted all of the new and revised Standards and Interpretations issued by the AASB that are mandatory for the current annual reporting period. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The adoption resulted in no material impact.

(c) Issued standards and interpretations not early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have not been adopted by the Company for the reporting period ended 31 December 2021. Those which may be relevant to the Company are set out in the table below, but these are not expected to have any significant impact on the Company's financial statements:

Standard/Interpretation	Application Date of Standard	Application Date for Company
AASB 2020-3 Amendments to Australian Accounting Standards – Annual Improvements 2018-2020 and Other Amendments	1 January2022	1 July2022
AASB 2020-1 Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-Current	1 January2023	1 July2023
AASB 2020-6 Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-Current – Deferral of Effective Date	1 January2023	1 July2023
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of Accounting Estimates	1 January2023	1 July2023

2. SEGMENT INFORMATION

AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Company that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

The Company operates in one segment, being exploration for mineral resources and in one geographical location being Australia. This is the basis on which internal reports are provided to the Directors for assessing performance and determining the allocation of resources within the Company.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 10

NOTES TO THE FINANCIAL STATEMENTS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 (Continued)

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3. INCOME AND EXPENSES

	Half Year	Half Year
	Ended 31	Ended 31
	December	December
	2021	2020
	$	$
Other Income
COVID-19 cash flow boost	-	52,524
	-	52,524
Employee benefits expense included in profit or loss
Wages, salaries and fees	273,277	330,549
Defined contribution plans	27,050	22,661
Share basedpayment expenses	10,323	98,086
	310,650	451,296

4. EXPLORATION AND EVALUATION ASSETS (NON-CURRENT)

		31 December	30 June
	Notes	2021	2021
		$	$
(a) Exploration and evaluation assets by area of interest
Orpheus Project (Fraser Range - Western Australia)	4(b)	350,000	350,000
Total exploration and evaluation assets		350,000	350,000
(b) Reconciliation of carrying amount:
Carryingamount at beginningofyear		350,000	350,000
Balance at end of the halfyear(1)		350,000	350,000

Notes:

1 The ultimate recoupment of costs carried forward for exploration and evaluation expenditure is dependent on the successful development and commercial exploitation or sale of the respective areas of interest.

5. CONTRIBUTED EQUITY

		Notes	31 December	30 June
			2021	2021
			$	$
(a)	Issued Capital
49,905,426(30 June 2021: 36,057,520)OrdinaryShares		5(b)	9,717,832	6,885,690
			9,717,832	6,885,690

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 11

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 (Continued)

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5. CONTRIBUTED EQUITY (Continued)

(b) Movements in Ordinary Shares were as follows:

		Number of	Issue
Date	Details	Ordinary Shares	Price $	$
31 Dec 2021
01-Jul-21	Opening Balance	36,057,520		6,885,690
Various	Issue of shares on exercise of listed options	13,547,906	$0.20	2,709,581
7-Oct-21	Issue of shares on exercise of unlisted options	300,000	$0.30	90,000
7-Oct-21	Transfer from SBP reserve upon exercise of options	-	-	33,788
31-Dec-21	Share issue costs	-	-	(1,227)
31-Dec-21	ClosingBalance	49,905,426		9,717,832
30 Jun 2021
01-Jul-20	Opening Balance	35,000,100	-	6,625,805
17-Mar-21	Issue of shares on exercise of unlisted options	300,000	$0.25	75,000
17-Mar-21	Transfer from SBP reserve upon exercise of options	-	-	33,401
Various	Issue of shares on exercise of listed options	757,420	$0.20	151,484
30-Jun-21	ClosingBalance	36,057,520		6,885,690

(c) Rights Attaching to Ordinary Shares

The rights attaching to fully paid ordinary shares (“ Ordinary Shares ”) arise from a combination of the Company's Constitution, statute and general law. Copies of the Company's Constitution are available for inspection during business hours at the Company's registered office. The clauses of the Constitution contain the internal rules of the Company and define matters such as the rights, duties and powers of its shareholders and directors, including provisions to the following effect (when read in conjunction with the Corporations Act 2001 or Listing Rules).

(i) Shares

The issue of shares in the capital of the Company and options over unissued shares by the Company is under the control of the directors, subject to the Corporations Act 2001 and any rights attached to any special class of shares.

(ii) Meetings of Members

Directors may call a meeting of members whenever they think fit. Members may call a meeting as provided by the Corporations Act 2001. The Constitution contains provisions prescribing the content requirements of notices of meetings of members and all members are entitled to a notice of meeting. A meeting may be held in two or more places linked together by audio-visual communication devices. A quorum for a meeting of members is 2 shareholders.

(iii) Voting

Subject to any rights or restrictions at the time being attached to any shares or class of shares of the Company, each member of the Company is entitled to receive notice of, attend and vote at a general meeting. Resolutions of members will be decided by a show of hands unless a poll is demanded. On a show of hands each eligible voter present has one vote. However, where a person present at a general meeting represents personally or by proxy, attorney or representative more than one member, on a show of hands the person is entitled to one vote only despite the number of members the person represents. On a poll each eligible member has one vote for each fully paid share held and a fraction of a vote for each partly paid share determined by the amount paid up on that share.

(iv) Changes to the Constitution

The Company's Constitution can only be amended by a special resolution passed by at least three quarters of the members present and voting at a general meeting of the Company. At least 28 days' written notice specifying the intention to propose the resolution as a special resolution must be given.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 12

NOTES TO THE FINANCIAL STATEMENTS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 (Continued)

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6. RESERVES

		31 December	30 June
		2021	2021
	Note	$	$
Share-based payments reserve	6(b)	178,392	201,857
Other equityreserve		1,200,148	1,200,148
		1,378,540	1,402,005

(a) Nature and Purpose of Reserves

(i) Share-based payments reserve

The share-based payments reserve is used to record the fair value of Unlisted Options, issued by the Company to employees, consultants, advisors etc as compensation.

(ii) Other equity reserve

Refer to note 6(d).

(b) Movements in the share-based payments reserve were as follows:

		Number of
		Incentive
Date	Details	Options	$
31 December 2021
1-Jul-21	Opening balance	2,000,000	201,857
7-Oct-21	Transfer from SBP reserve upon exercise of options	(300,000)	(33,788)
31-Dec-21	Share-basedpayment expense	-	10,323
31-Dec-21	Closingbalance	1,700,000	178,392
30 Jun 2021
1-Jul-20	Opening balance	1,000,000	111,120
20-Jul-20	Issue of unlisted incentive options	1,300,000	-
17-Mar-21	Transfer from SBP reserve upon exercise of options	(300,000)	(33,401)
30-Jun-21	Share-basedpayment expense	-	124,138
30-Jun-21	Closingbalance	2,000,000	201,857

(c) Terms and Conditions of Unlisted Options

The Options are granted based upon the following terms and conditions:

• Each Option entitles the holder to the right to subscribe for one Ordinary Share upon the exercise of each Option;

• The Options are exercisable at any time prior to the Expiry Date, subject to vesting conditions being satisfied (if applicable);

• Ordinary Shares issued on exercise of the Options rank equally with the then Ordinary Shares of the Company;

• Application will be made by the Company to Australian Securities Exchange (“ASX”) for official quotation of the Ordinary Shares issued upon the exercise of the Options;

• If there is any reconstruction of the issued share capital of the Company, the rights of the Option holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; and

• The Unlisted Options outstanding at the end of the half year are:

• 400,000 Unlisted Options exercisable at $0.40 each on or before 9 April 2022 (vested 9 April 2020);

• 433,333 Unlisted Options exercisable at $0.40 each on or before 30 June 2023 (vested immediately);

• 433,333 Unlisted Options exercisable at $0.50 each on or before 30 June 2023 (vested 20 July 2021); and

• 433,334 Unlisted Options exercisable at $0.60 each on or before 30 June 2023 (vesting 20 July 2022).

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 13

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 (Continued)

NOTES TO THE FINANCIAL STATEMENTS

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6. RESERVES (Continued)

(d) Other Equity Reserve

On 30 April 2018, the Company entered into a Debt for Equity Subscription Agreement with its parent entity Apollo Minerals Limited (“Apollo Minerals”). Under the terms of the agreement, Apollo Minerals agreed to forgive all loan advances made to the Company in relation to exploration activities at the Orpheus Project. The balance of the loan as at the date of forgiveness was $1,200,148. As the transaction was between a parent entity and subsidiary, the forgiven amount has been recognised directly in equity.

7. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS

Due to their short-term nature, the carrying amounts of current receivables and current payables is assumed to approximate their fair value.

8. EARNINGS PER SHARE

The following reflects the income and share data used in the calculations of basic and diluted earnings per share:

	Half Year	Half Year
	Ended 31	Ended 31
	December 2021	December 2020
Basic and diluted lossper share(centsper share)	(2.45)	(2.56)
	(2.45)	(2.56)
	Half Year	Half Year
	Ended 31	Ended 31
	December 2021	December 2020
	$	$
Net loss attributable to members of the parent used in calculating basic and diluted earningsper share:	(1,170,314)	(896,374)
Earnings used in calculatingbasic and dilutive earningsper share	(1,170,314)	(896,374)
	Number of	Number of
	Ordinary Shares	Ordinary Shares
	31 Dec 2021	31 Dec 2020
Weighted average number of Ordinary Shares used in calculating basic
and dilutive earningsper share	47,806,352	35,014,139

(a) Non-Dilutive Securities

As at reporting date, 1,700,000 Unlisted Options (which represent 1,700,000 potential Ordinary Shares) were considered non-dilutive as they would decrease the loss per share.

9. COMMITMENTS

As a condition of retaining the current rights to tenure to exploration tenements, the Company is required to pay an annual rental charge and meet minimum expenditure requirements for each tenement. These obligations are not provided for in the financial statements and are at the sole discretion of the Company:

	31 December	30 June
	2021	2021
	$	$
Commitments for exploration expenditure:
Not longer than 1 year	211,125	323,625
Longer than 1 year and shorter than 5 years	433,250	523,500
	644,375	847,125

As at the date of this report, no material contingent assets or liabilities had been identified as at 31 December 2021 (30 June 2021: nil).

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 14

NOTES TO THE FINANCIAL STATEMENTS

FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 (Continued)

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10. DIVIDENDS PAID OR PROVIDED FOR

No dividend has been paid or provided for during the current or previous half-year.

11. EVENTS SUBSEQUENT TO REPORTING DATE

As at the date of this report, there are no matters or circumstances which have arisen since 31 December 2021 that have significantly affected or may significantly affect:

• the operations, in financial years subsequent to 31 December 2021, of the Company;

• the results of those operations, in financial years subsequent to 31 December 2021, of the Company; or

• the state of affairs, in financial years subsequent to 31 December 2021, of the Company.

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 15

DIRECTORS’ DECLARATION

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In accordance with a resolution of the Directors of Constellation Resources Limited, I state that:

In the opinion of the Directors:

• (a) the attached financial statements and notes thereto for the half year ended 31 December 2021 are in accordance with the Corporations Act 2001, including:

• (i) complying with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations 2001; and

• (ii) giving a true and fair view of the Company's financial position as at 31 December 2021 and of its performance for the half year ended on that date.

• (b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

This declaration is signed in accordance with a resolution of the Board of Directors made pursuant to section 303(5) of the Corporations Act 2001.

On behalf of the Board

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PETER WOODMAN Managing Director

22 February 2022

Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 16

INDEPENDENT AUDITOR’S REVIEW REPORT

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Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 17

INDEPENDENT AUDITOR’S REVIEW REPORT (Continued)

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Constellation Resources Limited INTERM FINANCIAL REPORT 31 DECEMBER 2021 18