EVOLUTION MINING LIMITED - Regulatory Filings 2018

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APPENDIX 4E EVOLUTION MINING LIMITED ACN 084 669 036 AND CONTROLLED ENTITIES ANNUAL FINANCIAL REPORT For the year ended 30 June 2018

Results for Announcement to the Market

Key Information

	30 June 2018	30 June 2017	Up / (down)	% Increase/
	$'000	$'000	$'000	(decrease)
Revenues from ordinary activities	1,540,433	1,479,876	60,557	4%
SPACE
Earnings before Interest, Tax, Depreciation & Amortisation
(EBITDA)	795,083	713,855	81,228	11%
SPACE
Statutory profit before income tax	338,934	237,284	101,650	43%
SPACE
Profit from ordinary activities after income tax attributable to the
members	263,388	217,607	45,781	21%

Dividend Information

	Amount per share Cents Franked amount per share Cents	Amount per share Cents Franked amount per share Cents
Final dividend for the year ended 30 June 2018 Dividend to be paid on 28 September 2018 Space Interim dividend for the year ended 30 June 2018 Dividend fully paid on 30 March 2018 Space Final dividend for the year ended 30 June 2017 Dividend fully paid on 29 September 2017	4.0 3.5 3.0	4.0 3.5 3.0

Net Tangible Assets

	30	June	2018	30	June	2017	2017
			$			$
Net tangible assets per share			1.35			1.25

Earnings Per Share

	30 June 2018	30 June 2017
	Cents	Cents
Basic earnings per share	15.57	13.28
Diluted earnings per share	15.51	13.23

Additional Appendix 4E disclosure requirements can be found in the notes to these financial statements and the Directors' Report attached thereto. This report is based on the consolidated financial statements which have been audited by PricewaterhouseCoopers.

Directors' Report

The Directors present their report together with the consolidated financial report of the Evolution Mining Limited Group, consisting of Evolution Mining Limited ("the Company") and the entities it controlled at the end of, or during, the year ended 30 June 2018.

Directors

The Directors of Evolution Mining Limited during the year ended 30 June 2018 and up to the date of this report are set out below. All Directors held their position as a Director throughout the entire year and up to the date of this report unless otherwise stated.

Jacob (Jake) Klein	Executive Chairman
Lawrence (Lawrie) Conway	Finance Director and Chief Financial Officer
Colin (Cobb) Johnstone	Lead Independent Director
James (Jim) Askew	Non-Executive Director
Graham Freestone	Non-Executive Director
Thomas (Tommy) McKeith	Non-Executive Director
Naguib Sawiris (i)	Non-Executive Director
Sebastien de Montessus (i)	Non-Executive Director
Andrea Hall (ii)	Non-Executive Director
Vincent Benoit (iii)	Alternate Non-Executive Director for Naguib Sawiris
Amr El Adawy (iii)	Alternate Non-Executive Director for Sebastien de Montessus
Andrew Wray (iv)	Alternate Non-Executive Director for Naguib Sawiris and Sebastien de Montessus

(i) Resigned as Non-Executive Director effective 1 August 2018.

(ii) Appointed as Non-Executive Director effective 1 October 2017.

(iii) Resigned as Alternate Non-Executive Director effective 19 April 2018.

(iv) Appointed as Alternate Non-Executive Director effective 19 April 2018. Resigned as Alternate Non-Executive Director effective 1 August 2018.

Company Secretary

The name of the Company Secretary during the full year ended 30 June 2018 and up to the date of this report is as follows:

Evan Elstein

Principal activities

The principal activities of the Group during the year were exploration, mine development, mine operations and the sale of gold and gold/copper concentrate in Australia. There were no significant changes to these activities during the year.

Key highlights for the year

Key highlights for the year ended 30 June 2018 include:

Safety of our people is of paramount importance and our focus has been demonstrated through an improved total recordable injury frequency (TRIF) of 5.50 (30 June 2017: 7.96).
The Group recorded a statutory net profit after tax of $263.4 million for the year, an increase of 21% on the prior year. Underlying profit after tax increased by 21% to a record $250.8 million (30 June 2017: $206.6 million).
The Group’s continuing focus on productivity improvements and cost efficiencies delivered a year with outstanding results including:
Total gold production of 801,187oz at the upper end of original guidance for the year of 750,000oz - 805,000oz.
Record low AISC of A$797/oz, representing a decrease of 12% on the prior year and falling below original guidance of A$820/oz - A$870/oz.
Operating mine cash flow of A$811.8 million, representing an increase of 15% on the prior year.
Net mine cash flow of A$539.9 million, representing an increase of 17% on the prior year with all mines contributing positive cash flows after all capital investment.
Net bank debt has been reduced by $325.8 million to $71.8 million (30 Jun 2017: $397.6 million).

Directors' Report

Key highlights for the year (continued)

A total of $109.9 million (30 June 2017: $63.0 million) in fully franked dividends was paid during the year. A final dividend of 4 cents per share fully franked ($67.7 million) was declared and will be paid on 28 September 2018.
In May 2018, Evolution entered into an agreement with Orion Minerals Limited to acquire 100% of the Connors Arc exploration project, a large, early-stage exploration project covering approximately 3,200km², located 160km northwest of Rockhampton in Queensland. It is a technically compelling project with multiple and very extensive alteration zones which could be indicative of multiple preserved epithermal gold systems. The project area has similar geological characteristics to two of Evolution’s current mines, Mt Carlton and Cracow, both of which are greater than one million ounce epithermal gold deposits.
In March 2018, the Group successfully renewed the Senior Secured Revolving Loan (“Facility A”) and the Performance Bond Facility (“Facility C”) through to July 2021 for $350.0 million and $175.0 million respectively (previously $300.0 million and $155.0 million respectively). The expiry date of the Senior Secured Term Loan (“Facility D”) remains unchanged at October 2021. Facility A ($350.0 million) remained undrawn at 30 June 2018. The renewal of the debt facilities has secured a saving of approximately $6 million over the term of the loans compared to the previous pricing.
In February 2018, an agreement was reached with Emmerson Resources Limited to restructure the Tennant Creek Mineral Field Joint Venture. Under the new arrangement, Evolution has forgone its right to a 65% interest in the entire JV area and instead acquired a 100% interest in the Gecko, Goanna and Orlando Copper-Gold project.
In December 2017, the Group made its first income tax payment. A total of $48.4 million of income tax was paid during the year including tax paid for the 30 June 2017 financial year ($30.7 million) and tax instalments for the current year ($17.7 million).
On 3 October 2017, the sale of the Edna May Operation to Ramelius Operations Pty Ltd was completed for total proceeds of up to $90.0 million. The consideration comprised of a $40.0 million up-front cash payment and contingent consideration in the form of either a cash royalty, Ramelius shares, or combination of both up to $50.0 million.
In September 2017, the Group repaid the outstanding balance of $40.0 million on the Senior Secured Term Loan ("Facility B") in anticipation of the up-front cash payment to be received on the sale of the Edna May Operation. The Senior Secured Revolving Loan ("Facility A") remained undrawn during the year.
On 4 August 2017, the Group agreed to subscribe for a $2.5 million investment in the initial public offering of Riversgold Ltd, a new, gold-focussed, exploration company whose strategy is to build a portfolio of high-quality mineral projects with a view to sell or enter into a joint venture at an appropriate time in the project life cycle. This provided the Company with a shareholding of 15.1% in Riversgold Ltd.

Directors' Report

Operating and Financial Review

Evolution is a leading, growth-focussed Australian gold company. As at 30 June 2018, the Group consisted of five wholly-owned operating gold mines: Cowal in New South Wales; Cracow, Mt Carlton and Mt Rawdon in Queensland; and Mungari in Western Australia, and an economic interest in the Ernest Henry Copper-Gold Operation (100% of gold and 30% of copper and silver) in Queensland.

The Group’s strategy is to deliver shareholder value through efficient gold production, growing gold reserves and developing acquiring or divesting assets to improve the quality of the portfolio. Since its formation in November 2011, the Group has built a strong reputation for operational predictability and stability through a record of consistently achieving production and cost guidance with guidance met for seven consecutive years. A portfolio approach to production provides Evolution with a Group-wide level of operational stability and predictability without reliance on one single asset. The Group’s high-performance team culture and clearly defined business plans and goals further contribute to delivering reliable and consistent results.

To build a sustainable business, the Group maintains a strong commitment to growth through exploration and a disciplined methodical approach to business development through opportunistic, logical, value-accretive acquisitions and divestments.

Profit Overview

The Group achieved a record 12-month statutory net profit after tax of $263.4 million for the year ended 30 June 2018 (30 June 2017: $217.6 million), largely driven by a 12 month contribution from the Ernest Henry Copper-Gold Operation compared to 8 months in the previous year. In October 2017, the Group disposed of the Edna May asset to Ramelius Operations Pty Limited as part of its strategy to improve the quality of its asset portfolio.

The following graph shows the movements in the Group's statutory profit after tax for the year ended 30 June 2017 to the year ended 30 June 2018.

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Directors' Report

Operating and Financial Review (continued)

Profit Overview (continued)

The Group achieved a record underlying net profit after tax of $250.8 million for the year ended 30 June 2018 (30 June 2017: $206.6 million). The table below shows a reconciliation of statutory profit/(loss) before tax to the underlying profit after tax.

	2018	2017
	$'000	$'000
Statutory profit before income tax	338,934	237,284
Fair value gain	(3,142)	-
Loss on sale of subsidiary	-	3,576
Transaction and integration costs	(866)	6,987
Underlying profit before income tax	334,926	247,847
Income tax expense	(75,546)	(19,677)
Tax benefit on sale of subsidiary	4,165	-
Tax effect of adjustments	1,201	(1,182)
Recognition of previously unrecognised tax losses	(4,544)	(20,400)
Recognition ofpreviouslyunrecognised temporarydifferences	(9,440)	-
Underlying profit after income tax	250,762	206,588

Cash Flow

Operating mine cash flow increased 15% with all operations producing positive operating mine cash flows totalling $811.8 million (30 June 2017: $706.5 million). Total capital expenditure increased 11% which was in line with plan at $271.9 million (including all sustaining and major capital expenditure, rehabilitation costs and capital stripping).

The Group’s All in Sustaining Cost decreased by 12% to $797/oz (30 June 2017: $907/oz) driven by the inclusion of 12 months (30 June 2017: 8 months) of results from Ernest Henry which contributed an AISC of $(641)/oz for the year offset by the 11% increase in capital expenditure attributable in the most part to Cowal Stage H capital waste stripping costs and Cowal’s Float Tails Leach project.

Directors' Report

Operating and Financial Review (continued)

Key Results

The consolidated operating and financial results for the current and prior year are summarised below. All $ figures refer to Australian thousand dollars (A$'000) unless otherwise stated.

Key Business Metrics	30 June 2018	30 June 2017	% Change (ii)
Total underground ore mined (kt)	7,817	5,662	38%
Total underground lateral development (m)	13,640	11,290	21%
Total open pit ore mined (kt)	14,453	19,672	(27)%
Total open pit waste mined (kt)	40,984	33,128	24%
Processed tonnes (kt)	21,425	20,607	4%
Gold grade processed (g/t)	1.37	1.49	(8)%
Gold production (oz)	801,187	844,124	(5)%
Silver production (oz)	989,253	1,067,681	(7)%
Copperproduction(t)	23,268	14,898	56%
Unit cash operating cost (A$/oz) (i)	512	625	18%
All in sustaining cost (A$/oz) (i)	797	907	12%
All in cost(A$/oz) (i)	1,033	1,073	4%
Gold price achieved (A$/oz)	1,645	1,641	0.2%
Silver price achieved (A$/oz)	22	24	(8)%
Copperprice achieved(A$/t)	8,923	7,600	17%
Total Revenue	1,540,433	1,479,876	4%
Cost of sales (excluding D&A and fair value adjustments (i))	(705,553)	(719,738)	2%
Corporate, admin, exploration and other costs (excluding D&A)	(39,797)	(46,283)	14%
EBIT (i)	360,380	270,959	33%
EBITDA (i)	795,083	713,855	11%
Statutory profit/(loss) after income tax	263,388	217,607	21%
Underlying profit after income tax	250,762	206,588	21%
Operatingmine cash flow	811,766	706,484	15%
Capital expenditure	(271,870)	(244,998)	(11)%
Net mine cash flow	539,896	461,486	17%

(i) EBITDA, EBIT, Unit cash operating cost, All-in Sustaining Cost (AISC), and All-in Cost (AIC) are non-IFRS financial information and are not subject to audit.

(ii) Percentage change represents positive/(negative) impact on the business

(iii) Ernest Henry mining and processing statistics are in 100% terms while costs represent Evolution's cost and not solely the cost of Ernest Henry's operation.

Directors' Report

Operating and Financial Review (continued)

Mining Operations

Cowal

Cowal was the Group's highest producer, achieving above guidance gold production of 257,951oz (guidance of 235,000 - 245,000oz) at an average unit cash operating cost of $675/oz and AISC of $877/oz. Cash costs and AISC were in line with, and below the lower end of guidance of $660 -$720/oz and $950 - $1,000/oz respectively. Capital expenditure for the year was $124.6 million, of which $84.9 million relate to the Stage H and Float Tails (Dual) Leach projects. Commissioning of the Float Tails (Dual) Leach project is forecast to commence in September 2018. Once commissioned, the project is expected to increase recoveries between 4 and 6%.

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Cowal ore mining activities in the year focussed on the E42 Stage G cutback to a current operating level of 858mRL. At 30 June 2018, Stage H material movement remained on track, and mining activities have transitioned from free digging in the oxides to drill and blast in the primary rock.

During March 2018, Cowal submitted the Modification 14 development application, which includes seeking approval to increase plant throughput from 7.5Mtpa to 9.8Mtpa to the NSW Department of Planning and Environment. Public support has been strong. Evolution has submitted responses to public submissions and is now awaiting a decision from the regulator. This is expected to be received in the second half of FY19.

Exploration work delivered material resource growth, reflected in the Mineral Resources and Ore Reserves update which incorporated full year drilling results and contributed an 816,000oz addition at Galway Regal E46 Underground and at the E41 and E46 open pits. Work programs in FY19 will aim to further delineate extensions of these resources along strike and at depth. Definition drilling is also planned to confirm grade continuity and understand geologic controls on grade distribution to support further classification upgrades.

A maiden Ore Reserve for Marsden, located 17km from the Cowal plant, has been also included in the Mineral Resources and Ore Reserves update, contributing 835,000oz of gold and 380,000t of copper.

Key Business Metrics	30 June 2018 30 June 2017 Change % Change
Operating cash flow ($'000) Sustaining capital ($'000) Major capital ($'000) Total capital ($'000) Net mine cash flow ($'000) Gold production (oz)	225,812 237,007 (11,195) (5)% (39,697) (43,849) 4,152 (9)% (84,923) (27,080) (57,843) 214% (124,620) (70,929) (53,691) 76% 101,192 166,078 (64,886) (39)% 257,951 263,015 (5,064) (2)%
All-in Sustaining Cost ($/oz) All-in Cost($/oz)	877 833 (44) 5% 1,223 941 (282) 30%

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Mungari

Mungari produced a total of 118,498oz at an average unit cash operating cost of $991/oz and an AISC of $1,181/oz. Gold production was below guidance of 120,000 - 130,000oz due to significant seismic activity at the Frog's Leg underground mine in the first half of FY18. As a consequence cash costs and AISC were above guidance of $860 - $910/oz and $990 - $1,050/oz respectively. Capital expenditure in the year was $46.6 mllion of which $8.9 million related to mine development at the Frog’s Leg underground mine and $27.7 million related to capital waste stripping on the White Foil open pit.

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The Frog’s Leg underground mine produced 462kt of ore at an average grade of 5.32g/t. Total development for the year was 1,749m but was impacted by heading availability and rehabilitation operations in the first half. Total material moved at the White Foil open pit was 501kt at an average grade of 1.61 g/t. The Stage 3 cutback progressed on plan and moved into an operating phase during the later half of the year with subsequent reduced volumes of capital waste being recognised.

The process plant performed well over the course of the year, with 1,654kt of ore processed at an average grade of 2.36g/t. Increased gold recoveries of 94.2% were achieved (30 June 2017 : 92.4%) following the successful commissioning of an additional Knelson concentrator allowing for increased recoveries in the gravity circuit.

Mungari’s performance is expected to improve in FY19 driven by the completion of the White Foil Stage 3 cutback and increased availability of high-grade ore feed from the Frog’s Leg underground mine.

Investment in discovery and resource definition drilling programs across the Mungari tenements continued during the year with full results received for definition drilling at the White Foil underground target incorporated in the December 2017 Mineral Resources and Ore Reserves update. Development commenced to extend the Frog’s Leg decline with the aim of establishing an underground drilling position to test extensions of the Frog’s Leg vein structure well below the base of the deepest workings. Drilling at Perimeter and Scottish Archer targets, north of the Mungari processing plant, has returned significant mineralisation. During FY19, drilling is planned to delineate the full scope of the mineralised system at Perimeter and to test the depth and strike extents of the high-grade zone at Scottish Archer.

Key Business Metrics	30 June 2018 30 June 2017 Change % Change
Operating cash flow ($'000) Sustaining capital ($'000) Major capital ($'000) Total capital ($'000) Net mine cash flow ($'000) Goldproduction(oz)	70,240 95,958 (25,718) (27)% (9,935) (14,566) 4,631 (32)% (36,611) (22,161) (14,450) 65% (46,546) (36,727) (9,819) 27% 23,694 59,231 (35,537) (60)% 118,498 143,820 (25,322) (18)%
All-in Sustaining Cost ($/oz) All-in Cost($/oz)	1,181 1,143 38 (3)% 1,604 1,371 233 (17)%

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Mt Carlton

Mt Carlton produced 112,479oz, exceeding guidance of 100,000 - 110,000 ozs. Unit cash operating costs of $299/oz and AISC of $535/oz were both substantially below the bottom end of guidance of A$420 - $470/oz and A$680 - $730/oz respectively. The production and cash cost performance over and above plan was predominantly due to higher grades in bonanza zones of the pit outperforming the resource model.

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Mining during the year was focussed on the western end of Stage 3a of the V2 pit with a shift in focus to the Stage 3b cutback in the later stages. This placed emphasis on Stage 3b ore, and the new Southern ramp construction with anticipation that ore from Stage 3b North (75RL) will be delivered in early FY19.

Capital expenditure for the year of $30.9 million is largely attributed to Stage 3b capital waste of $21.0 million combined with the purchase of a new excavator and the start of Stage 5 Tailings Storage Facility lift.

The Mine Extension Feasibility Study is ongoing and due for completion and decision in the first half of FY19.

Key Business Metrics	30 June 2018	30 June 2017	Change	% Change
Operating cash flow ($'000)	139,598	120,339	19,259	16%
Sustaining capital ($'000)	(9,866)	(15,304)	5,438	(36)%
Major capital ($'000)	(21,009)	(13,887)	(7,122)	51%
Total capital ($'000)	(30,875)	(29,191)	(1,684)	6%
Net mine cash flow ($'000)	108,723	91,148	17,575	19%
Gold production (oz)	112,479	105,024	7,455	7%
All-in Sustaining Cost ($/oz)	535	622	(87)	(14)%
All-in Cost($/oz)	735	762	(27)	(4)%

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Mt Rawdon

Mt Rawdon achieved total gold production of 105,053oz at a unit cash operating cost of A$693/oz and an AISC of A$884/oz. Production was at the lower end of guidance of 105,000 - 115,000oz, while cash costs and AISC were within guidance of $670 - $720/oz and $850 - $900/oz respectively. Capital expenditure for the year was $19.5 million with a large amount of this attributable to capital waste mined in the Stage 4 cutback.

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Mining activities during the year were focussed on the progression of the Stage 4 cutback and sourcing ore from the lower benches of the open pit. In the early FY19 the plant will predominantly process stockpiles as mining activities focus on waste material in Stage 4 and installing additional ground support in the western area of the pit.

Key Business Metrics	30 June 2018 30 June 2017 Change % Change	30 June 2018 30 June 2017 Change % Change
Operating cash flow ($'000) Sustaining capital ($'000) Major capital ($'000) Total capital ($'000) Net mine cash flow ($'000) Gold production (oz)	69,198 69,035 163 (8,574) (14,242) 5,668 (10,924) (19,071) 8,147 (19,498) (33,313) 13,815 49,700 35,722 13,978 105,053 101,331 3,722	% (40)% (43)% (41)% 39% 4%
All-in Sustaining Cost ($/oz) All-in Cost($/oz)	884 873 11 (1)% 987 1,065 (78) 7%

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Cracow

Cracow exceeded guidance of 85,000 - 90,000oz, producing 90,357oz at a unit cash operating cost of $762/oz and AISC of $1,181/oz. Cash costs were below the lower end of the guidance of $810 - $860/oz while AISC was within the guidance range of $1,150 - $1,200/oz.

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A total of 537kt of ore was mined at an average grade of 5.51g/t during the year with primary ore sources being the Kilkenny, Coronation and Griffin ore bodies.

Capital expenditure for the year was A$34.0 million comprising mainly of capital works to upgrade the airstrip servicing the site, mobile fleet replacement and refurbishment, and mine development. Capital investment at the mine increased in FY18 and will be similar in FY19 due to the age of the mine and the successful increase in mine life over the last 18-24 months.

Resource definition and exploration drill programs at Cracow during the year returned strong results from the Killarney structure where mineralisation is continuing to be defined to the south of the current resource.

Key Business Metrics	30 June 2018	30 June 2017	Change	% Change
Operating cash flow ($'000)	70,771	72,690	(1,919)	(3)%
Sustaining capital ($'000)	(19,601)	(17,462)	(2,139)	12%
Major capital ($'000)	(14,451)	(14,168)	(283)	2%
Total capital ($'000)	(34,052)	(31,630)	(2,422)	8%
Net mine cash flow ($'000)	36,719	41,060	(4,341)	(11)%
Gold production (oz)	90,357	89,496	861	1%
All-in Sustaining Cost ($/oz)	1,181	1,123	58	(5)%
All-in Cost($/oz)	1,269	1,208	61	(5)%

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Ernest Henry

Attributable production from Ernest Henry was 95,209oz of gold exceeding guidance of 85,000 - 90,000oz, 66,750oz of silver and 21,011t of copper at a negative unit cash operating cost of $(921)/oz and a negative AISC of $(641)/oz after copper and silver by-product credit of (1,984)/oz. Cash costs and AISC were substantially below FY18 guidance of $(500) - $(300)/oz and $(200) - $(150)/oz respectively.

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Ore mined was 6,819kt at an average grade of 0.56g/t gold and 1.12% copper. Underground development was 6,781m. Ore processed was 6,759kt at an average grade of 0.56g/t gold and 1.12% copper. Gold recovery and copper recovery of 80.3% and 96.3% respectively were achieved.

Key Business Metrics	30 June 2018 30 June 2017 (i) Change % Change
Operating cash flow ($'000) Sustaining capital ($'000) Major capital ($'000) Total capital ($'000) Net mine cash flow ($'000) Gold production (oz) Copperproduction(t)	230,860 87,851 143,009 163% (11,618) (6,066) (5,552) 92% - - - -% (11,618) (6,066) (5,552) 92% 219,242 81,785 137,457 168% 95,209 60,259 34,950 58% 21,011 13,306 7,705 58%
All-in Sustaining Cost ($/oz) All-in Cost($/oz)	(641) (361) (280) 78% (641) (361) (280) 78%

(i) Results for 2017 were for 8 months from 1 November 2016.

(ii) Ernest Henry mining and processing statistics are in 100% terms while costs represent Evolution's cost and not solely the cost of Ernest Henry's operation.

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Edna May

The Edna May Operation was sold on 3 October 2017 to Ramelius Operations Pty Ltd for total proceeds of up to $90.0 million. The consideration comprised of a A$40.0 million up-front cash payment and contingent consideration in the form of either a cash royalty, Ramelius shares, or combination of both up to $50.0 million.

No profit or loss has been recognised on disposal with the value of the consideration, including the net present value of the contingent consideration, closely matching the carrying value of the Edna May Operation at date of disposal. No contingent consideration has been received to date. The value of the contingent consideration will be assessed at each reporting period.

During the period that Edna May was still under Evolution ownership, Edna May produced 21,639oz of gold at an AISC of $1,588/oz.

Financial Performance

Profit or Loss

Revenue for the year ended 30 June 2018 increased by 4% to $1,540.4 million (30 June 2017: $1,479.9 million). This is largely due to a full 12 months’ sales contribution from Ernest Henry totalling $347.4 million (30 June 2017: $163.3 million). This is comprised of $188.8 million for copper and silver revenue and $158.6 million for gold revenue (30 June 2017: $102.9 million for 8 months of copper and silver revenue and $60.4 million for 5 months of gold revenue). The achieved copper price increased 17% to $8,923/t which favourably impacted revenue in the year. This was partly offset by the impact of the disposal of the Edna May Operation which resulted in a decrease of $79.7 million on the prior year.

Total gold sold equalled 798,101oz which included deliveries into the hedge book of 205,915oz at an average price of $1,564/oz (30 June 2017: 248,493oz, $1,584/oz). The remaining 592,186oz were sold at spot price achieving an average price of $1,673/oz (30 June 2017: 568,830oz, $1,666/oz). The Group's hedge book totals 250,000oz as at 30 June 2018 at an average price of $1,711/oz with deliveries through to June 2020.

Operating costs (excluding depreciation, amortisation and fair value adjustments of $435.6 million) decreased to $705.5 million (30 June 2017: $719.7 million) largely as a result of the sale of Edna May during the year which resulted in a decrease of $61.5 million on the prior year. This was offset by the inclusion of 12 months’ worth of Ernest Henry’s results, which accounted for an increase of $52.3 million in operating costs (30 June 2018: $116.4 million; 30 June 2017: $64.1 million). The operating costs for the five existing mine sites remained consistent, with an increase of only 2% on the prior year to $554.6 million.

An independent valuation of the Cowal open pit and Mungari open pit and underground has been completed during the financial year. A balance sheet reclassification of $90.5 million has been recorded (from Property, Plant and Equipment to Mine Development) with a resulting $2.9 million of additional mine development amortised during this financial year. As a consequence of this valuation, a reduction in income tax expense for the year of $22.7 million has been recorded of which $9.4 million has been excluded from underlying profit as it relates to tax depreciation that will be deducted in future years.

The Group posted a 21% increase in statutory profit after tax to $263.4 million (30 June 2017: $217.6 million) driven by increased sales, decreased costs per ounce and decreased transaction costs and exploration expense. Underlying profit after tax was $250.8 million (30 June 2017: $206.6 million).

Balance Sheet

Total assets increased 4% during the year to $3,056.3 million (30 June 2017: $2,945.5 million). An increase in cash of $285.8 million since 30 June 2017 to $323.2 million combined with the recognition of deferred consideration on the Edna May disposal of $34.4m has been offset by the disposal of total assets attributable to Edna May of $114.0 million as well as a reduction in the net carrying amount of property, plant and equipment and producing mines due to a depreciation charge of $405.2 million outstripping capital additions of $323.8 million. Non-current inventories increased by $37.6 million to $38.5 million and include ore stockpiles at Mt Rawdon ($16.9 million) and Cowal ($21.6 million) not expected to be processed within 12 months. The Cowal ore stockpile of $13.3 million at the beginning of the year has been reclassified from Mine Development.

Directors' Report

Operating and Financial Review (continued)

Financial Performance (continued)

Balance Sheet (continued)

Total liabilities for the Group decreased to $767.9 million at 30 June 2018, a decrease of $49.3 million, or 6% on the prior year. The decrease is in part attributable to the $40.0 million final repayment of the Senior Secured Term Loan (“Facility B”) established for the Cowal acquisition. The remaining decrease is due to the disposal of liabilities of $37.6 million related to the sale of Edna May offset by a $11.1 million increase in the current tax liability to $47.3 million at 30 June 2018.

The Group ended the year with a cash balance of $323.2 million and available credit of $350.0 million in Facility A as part of its Senior Secured Syndicated Revolving and Term Facility.

Cash Flow

Total cash inflows for the year amounted to $285.8 million (30 June 2017: inflow $20.2 million).

	30 June 2018	30 June 2017	Change
	$'000	$'000	$'000	% Change
Cash flows from operating activities	714,166	650,795	63,371	10%
Cash flows from investing activities	(270,284)	(1,120,794)	850,510	(76)%
Cash flows from financingactivities	(158,087)	490,156	(648,243)	(132)%
Net movement in cash	285,795	20,157	265,638	1,318%
Cash at the beginning of the year	37,385	17,295	20,090	116%
Effects of exchange rate changes on cash	46	(67)	113	(169)%
Cash at the end of the year	323,226	37,385	285,841	765%

Net cash outflows from investment activities were $270.3 million, an $850.5 million decrease (30 June 2017: $1,120.8 million) in the most part attributable to the prior year payments for the acquisition of the economic interest in Ernest Henry Copper-Gold Operation of $884.0 million (including transaction fees) and receipt of $41.9 million on the sale of Pajingo. Capital investments for the year include property, plant and equipment of $116.1 million and mine development and exploration of $191.9 million.

Net cash outflows from financing activities were $158.1 million, an increase of $648.2 million (30 June 2017: inflow $490.2 million). Financing cash flows for the year included the repayment of $40.0 million on the Senior Secured Term Loan and dividend payments of $109.9 million offsetting the $408.8 million in equity raised in 2017.

Taxation

During the year, the Group made its first income tax payment of $36.2 million related to the 30 June 2017 financial year and recognised an income tax expense of $75.5 million (30 June 2017: $19.7 million). On the balance sheet, the Company recognised a current tax liability of $47.3 million (30 June 2017: $36.2 million) and a deferred tax asset of $0.4 million (30 June 2017: $16.4 million).

Income tax expense for the year has been reduced by $26.7 million due to the recognition of tax losses and temporary differences as an asset. This includes $22.7 million as a consequence of an independent valuation of the Cowal open pit and Mungari open pit and underground that was completed during the financial year.

The tax payments made in respect of the 30 June 2017 financial year combined with tax instalments paid over the course of the 30 June 2018 financial year have enabled the declaration of fully franked interim and final dividends.

Capital Expenditure

Capital expenditure for the year totalled $271.9 million (30 June 2017: $245.0 million). This consisted of sustaining capital, including near mine exploration and resource definition of $100.9 million (30 June 2017: $116.6 million) and mine development of $171.0 million (30 June 2017: $128.4 million). The main capital projects included the Stage H and Float Tails (Dual) Leach projects ($84.6 million) at Cowal, Cracow underground mine development ($14.4 million), Mt Rawdon capital waste stripping ($10.9 million) and Mungari underground development ($8.9 million).

Directors' Report

Operating and Financial Review (continued)

Financial Performance (continued)

Financing

Total finance costs for the year were $24.8 million (30 June 2017: $35.2 million), a decrease of 30%. Included in total finance costs are interest expense of $20.5 million (30 June 2017: $24.2 million), amortisation of debt establishment costs of $0.7 million (30 June 2017: $7.4 million) and discount unwinding on mine rehabilitation liabilities of $3.6 million (30 June 2017: $3.3 million).

In September 2017, the Group repaid the outstanding balance of $40.0 million on the Senior Secured Term Loan ("Facility B") in anticipation of the up-front cash payment to be received on the sale of the Edna May Operation. The Senior Secured Revolving Loan ("Facility A") remained undrawn during the year.

In March 2018, the Group successfully renewed the Senior Secured Revolving Loan (“Facility A”) and the Performance Bond Facility (“Facility C”) through until July 2021 for $350.0 million and $175.0 million respectively (previously $300.0 million and $155.0 million respectively). The expiry on the Senior Secured Term Loan (“Facility D”) remains unchanged at October 2021. The renewal of the debt facilities has secured a saving of approximately $6 million over the term of the loans compared to the previous pricing.

The repayment periods and the outstanding balances as at 30 June 2018 on each facility are set out below:

Facility	Term date	Outstanding balance
Senior Secured Revolving Loan - Facility A ($350.0 million)	31 July 2021	$ nil
Performance Bond Facility - Facility C	31 July 2021	$132 million
Senior Secured Term Loan - Facility D	15 October 2021	$395 million

Material business risks

The Group prepares its business plans using estimates of production and financial performance based on a range of assumptions and forecasts. There is uncertainty in these assumptions and forecasts, and risk that variation from them could result in actual performance being different to expected outcomes. The uncertainties arise from a range of factors, including the nature of the mining industry and general economic factors. The material business risks faced by the Group that may have an impact on the operating and financial prospects of the Group as at 30 June 2018 are:

Fluctuations in the gold price and Australian dollar

The Group’s revenues are exposed to fluctuations in the gold, silver and copper prices and the Australian dollar. Volatility in the gold, silver and copper prices and Australian dollar creates revenue uncertainty and requires careful management of business performance to ensure that operating cash margins are maintained should the Australian dollar price fall.

Declining gold, silver and copper prices can also impact operations by requiring a reassessment of the feasibility of a particular exploration or development project. Even if a project is ultimately determined to be economically viable, the need to conduct such a reassessment could cause substantial delays and/or may interrupt operations, which may have a material adverse effect on our results of operations and financial condition.

Mineral Resources and Ore Reserves

The Group’s Mineral Resources and Ore Reserves are estimates, and no assurance can be given that the estimated reserves and resources are accurate or that the indicated level of gold, silver, copper or any other mineral will be produced. Such estimates are, in large part, based on interpretations of geological data obtained from drill holes and other sampling techniques. Actual mineralisation or geological conditions may be different from those predicted. No assurance can be given that any part or all of the Group’s Mineral Resources constitute or will be converted into Ore Reserves.

Market price fluctuations of gold, silver and copper as well as increased production and capital costs may render the Group’s Ore Reserves unprofitable to develop at a particular site or sites for periods of time or may render Ore Reserves containing relatively lower grade mineralisation uneconomic. Estimated reserves may have to be re-estimated based on actual production experience. Any of these factors may require the Group to reduce its Mineral Resources and Ore Reserves, which could have a negative impact on the Group’s financial results.

Directors' Report

Operating and Financial Review (continued)

Material business risks (continued)

Replacement of depleted reserves

The Group must continually replace reserves depleted by production to maintain production levels over the long term. Reserves can be replaced by expanding known ore bodies, locating new deposits or making acquisitions. Exploration is highly speculative in nature. The Group’s exploration projects involve many risks and are frequently unsuccessful. Once a site with mineralisation is discovered, it may take several years from the initial phases of drilling until production is possible.

As a result, there is no assurance that current or future exploration programs will be successful. There is a risk that depletion of reserves will not be offset by discoveries or acquisitions or that divestitures of assets will lead to a lower reserve base. The mineral base of the Group may decline if reserves are mined without adequate replacement and the Group may not be able to sustain production beyond the current mine lives, based on current production rates.

Mining risks and insurance risks

The mining industry is subject to significant risks and hazards, including environmental hazards, industrial accidents, unusual or unexpected geological conditions, unavailability of materials and equipment, pit wall failures, rock bursts, seismic events, cave-ins, and weather conditions (including flooding and bush fires), most of which are beyond the Group’s control. These risks and hazards could result in significant costs or delays that could have a material adverse effect on the Group’s financial performance, liquidity and results of operation. The Group maintains insurance to cover the most common of these risks and hazards. The insurance is maintained in amounts that are considered reasonable depending on the circumstances surrounding each identified risk. However, property, liability and other insurance may not provide sufficient coverage for losses related to these or other risks or hazards.

Production and cost estimates

The Group prepares estimates of future production, cash costs and capital costs of production for its operations. No assurance can be given that such estimates will be achieved. Failure to achieve production or cost estimates or material increases in costs could have an adverse impact on the Group’s future cash flows, profitability, results of operations and financial condition.

The Group’s actual production and costs may vary from estimates for a variety of reasons, including: actual ore mined varying from estimates of grade, tonnage, dilution and metallurgical and other characteristics; short-term operating factors relating to the ore reserves, such as the need for sequential development of ore bodies and the processing of new or different ore grades; revisions to mine plans; risks and hazards associated with mining; natural phenomena such as inclement weather conditions, water availability and floods; and unexpected labour shortages or strikes.

Costs of production may also be affected by a variety of factors including: changing waste-to-ore ratios, ore grade metallurgy, labour costs, cost of commodities, general inflationary pressures and currency exchange rates.

Environmental, health and safety, and permits

The Group’s mining and processing operations and exploration activities are subject to extensive laws and regulations governing the protection of the environment, waste disposal, worker safety, mine development and protection of endangered and other special status species. The Group’s ability to obtain permits and approvals and to successfully operate may be adversely impacted by real or perceived detrimental events associated with the Group’s activities or those of other mining companies affecting the environment, human health and safety or the surrounding communities. Delays in obtaining or failure to obtain government permits and approvals may adversely affect the Group’s operations, including its ability to continue operations.

While the Group has implemented extensive health, safety and community initiatives at its sites to ensure the health and safety of its employees, contractors and members of the community affected by its operations, there is no guarantee that such measures will eliminate the occurrence of accidents or other incidents which may result in personal injuries or damage to property, and in certain instances such occurrences could give rise to regulatory fines and/or civil liability.

Directors' Report

Operating and Financial Review (continued)

Material business risks (continued)

Community relations

The Group has an established community relations function, both at a Group level and at each of its operations. The Group function has developed a community engagement framework, including a set of principles, policies and procedures designed to provide a structured and consistent approach to community activities across our sites whilst recognising that, fundamentally, Community Relations is about people connecting with people. The Group recognises that a failure to appropriately manage local community stakeholder expectations may lead to dissatisfactions which have the potential to disrupt production and exploration activities.

Risk management

The Group manages the risks listed above, and other day-to-day risks through an established management framework which conforms to Australian and international standards and guidance. The Group’s risk reporting and control mechanisms are designed to ensure strategic, operational, legal, financial, reputational and other risks are identified, assessed and appropriately managed. These are reviewed by the Risk Committee throughout the year.

The financial reporting and control mechanisms are reviewed during the year by management, the internal audit process, the Audit Committee and the external auditors.

The Group has policies in place to manage risk in the areas of Health and Safety, Environment and Equal Employment Opportunity.

The Leadership Team, the Risk Committee and the Board regularly review the risk portfolio of the business and the effectiveness of the Group’s management of those risks.

Dividends

In August 2017, the Directors approved a change to the dividend policy of whenever possible paying a dividend equivalent to 50% of the Group's after tax earnings. The change was effective immediately and was applied to the final dividend for 2017 and interim dividend for 2018. This policy remains consistent at 30 June 2018. Dividends will be rounded to the nearest half-cent.

The Board has confirmed that Evolution is in a sound position to meet its commitment under the new policy to pay a final fully franked dividend for the current period of 4 cents per share, totalling $67.7 million. Evolution shares will trade excluding entitlement to the dividend on 28 August 2018, with the record date being 29 August 2018 and payment date of 28 September 2018.

The Dividend Reinvestment Plan ("DRP") remains suspended.

Significant changes in the state of affairs

There were no significant changes in the nature of the activities of the Group during the period, other than those included in the Key Highlights.

Further information on likely developments in the operations of the Group and the expected results of operations have not been included in this Annual Financial Report because the Directors believe it would be likely to result in unreasonable prejudice to the Group.

Events occurring after the reporting period

No matter or circumstance has occurred subsequent to the year end that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations or state of affairs of the Group or economic entity in subsequent financial years except for the following matters:

On 18 July, the Company reached an agreement to terminate Norton Gold Field’s right to mine and process ore from the Castle Hill deposit. This provides Evolution with full ownership and unfettered access to the deposit located 25km from the Mungari processing facility. Castle Hill is estimated to contain Ore Reserves of 236,000oz which will provide a material extension to the operating life at Mungari. Evolution will pay an initial up-front cash payment of $12 million (paid 31 July 2018), a further $3 million six months after completion of the transaction and a 2% net smelter royalty over the first 38,000oz of gold production from certain tenements within the Castle Hill deposit area.

Directors' Report

Events occurring after the reporting period (continued)

On 26 July, it was announced that La Mancha had undertaken a block trade monetisation of shares reducing its direct interest in Evolution to 9.6%. In accordance with the terms of the Share Sale Agreement signed between Evolution and La Mancha in April 2015, La Mancha had the right to nominate Directors to the Board of Evolution provided that it held more than 10.0% of the shares on issue in Evolution. La Mancha's nominee Directors, Mr Naguib Sawiris, Mr Sebastian de Montessus and their Alternate Director, Mr Andrew Wray resigned from the Board of Directors of Evolution effective 1 August 2018.

Environmental regulation and performance

The Executive Chairman reports to the Board on all significant safety and environmental incidents. The Board also has a Risk Committee which has oversight of the safety, health and environmental performance of the Group and meets at least two times per year. The Directors are not aware of any environmental incidents occurring during the year ended 30 June 2018 which would have a materially adverse impact on the overall business of the Group.

The operations of the Group are subject to environmental regulation under the jurisdiction of the countries in which those operations are conducted namely in Australia. Each mining operation is subject to particular environmental regulation specific to their activities as part of their operating licence or environmental approvals. Each of our sites are required to also manage their environmental obligations in accordance with our corporate environmental policies and standards.

The environmental laws and regulations that cover each of our sites, combined with our policies and standards, address the potential impact of the Group's activities in relation to water and air quality, noise, land disturbance, waste and tailings management, and the potential impact upon flora and fauna.

The Group has a uniform internal reporting system across all sites. All environmental incidents, including breaches of any regulation or law are assessed according to their actual or potential environmental consequence. Given levels of environmental incidents are tracked based on factors such as spill volume, incident location (onsite or offsite) and potential or actual environmental impacts. These levels include: I (insignificant), II (minor), III (moderate), IV (major), V (catastrophic).

Across the five Evolution Mining Sites, excluding government reporting for vehicular and non-vehicular native fauna deaths, the Level III reports for the past two years have been:

	2018	2017
Number of Level III incidents	8	9

Incidents were notified to the relevant government authority and the relevant agreed action was taken. There have been no Level IV or V incidents.

Directors' Report

Information on Directors

The following information is current as at the date of this report. Please refer to the Remuneration Report section (e) for details of shareholdings, options and rights.

Jacob (Jake) Klein, BCom Hons, ACA, Executive Chairman Mr Klein was appointed as Executive Chairman in October 2011, following the merger of Conquest Mining Limited and Catalpa Resources Limited. Previously he served as the Executive Chairman of Conquest Mining. Prior to that, Mr Klein was President and CEO of Sino Gold Mining Limited, where he managed the development of that company into the largest foreign participant in the Chinese gold industry. Sino Gold was listed on the ASX in 2002 with a market capitalisation of A$100 million and was purchased by Eldorado Gold Corporation in late 2009 for over A$2 billion. It became an ASX/S&P 100 Company, operating two award-winning gold mines and engaging over 2,000 employees and contractors in China. Prior to joining Sino Gold (and its predecessor) in 1995, Mr Klein was employed at Macquarie Bank and PricewaterhouseCoopers. Mr Klein was a Non-Executive Director of the Lynas Corporation Limited from August 2004 to May 2017, a company with operations in Australia and Malaysia and of OceanaGold Corporation from December 2009 to July 2014 a company with operations in the Philippines, USA and New Zealand. Lawrence (Lawrie) Conway B Bus, CPA, GAICD, Finance Director and Chief Financial Officer Mr Conway was appointed Finance Director and Chief Financial Officer of Evolution Mining Limited with effect from 1 August 2014 (previously a Non-Executive Director). Mr Conway has more than 28 years’ experience in the resources sector across a diverse range of commercial, financial and operational activities. He has held a mix of corporate, operational and commercial roles within Australia, Papua New Guinea and Chile with Newcrest and prior to that with BHP Billiton. He most recently held the position of Executive General Manager – Commercial and West Africa with Newcrest Mining where he was responsible for Newcrest's group Supply and Logistics, Marketing, Information Technology and Laboratory functions as well as Newcrest's business in West Africa. Mr Conway is a Non-Executive Director of Aurelia Metals Ltd (appointed in June 2017). James (Jim) Askew, BEng (Mining), MEngSc, FAusIMM, MCIMM, MSME (AIME), MAICD, Non-Executive Director Mr Askew is a mining engineer with more than 40 years’ broad international experience as a Director and Chief Executive Officer for a wide range of Australian and international publicly listed mining, mining finance and other mining related companies. Mr Askew has served on the boards of numerous mining and mining services companies, which currently include OceanaGold Limited (Chairman since November 2006), a company with operations in the Philippines, USA and New Zealand; Syrah Resources Limited (Chairman since October 2014), a company with operations in Mozambique and in the USA; and Endeavour Mining Corporation (Non-Executive Director since July 2017), a company with operations in Cote d’Ivoire, Mali and Burkina Faso. Mr Askew is a member of the Risk Committee and Member of the Nomination and Remuneration Committee. Within the last 3 years Mr Askew has been a Non-Executive Director of Nevada Copper Limited and Asian Mineral Resources Ltd.

Directors' Report

Information on Directors (continued)

Graham Freestone, BEc (Hons), Non-Executive Director

Mr Freestone has more than 45 years’ experience in the petroleum and natural resources industry. He has a broad finance, corporate and commercial background obtained in Australia and internationally through senior finance positions with the Shell Group, Acacia Resources Limited and AngloGold Ashanti Limited.

Mr Freestone was the Chief Financial Officer and Company Secretary of Acacia Resources Limited from 1994 until 2001. From 2001 to 2009 he was a Non-Executive director of Lion Selection Limited, and from 2009 to 2011 he was a Non-Executive director of Catalpa Resources Limited, and Chaired their Audit Committees during that period.

Mr Freestone is a Non-Executive Director of Kasbah Resources Limited (appointed February 2017) a company with a tin project in Morocco, and Chairs its Remuneration and Audit Committees.

Mr Freestone was Chair of the Audit Committee from 2011 until June 2018 and remains a member of the Audit Committee. Subsequent to year end, Mr. Freestone stepped down from the Risk Committee and was appointed as a member of the Nomitation and Remuneration Committee.

Colin (Cobb) Johnstone, BEng (Mining), Lead Independent Director

Mr Johnstone is a mining engineer with over 30 years' experience in the resources sector. He has served as General Manager at some of Australia's largest mines including the Kalgoorlie Super Pit in Western Australia, the Olympic Dam Mine in South Australia and the Northparkes Mine in New South Wales. He has extensive international experience including Canada, China, Africa and South America.

Mr Johnstone was Chief Operating Officer at Equinox Minerals Limited, until the acquisition by Barrick Gold Corporation in 2011. Prior to that Mr Johnstone was Chief Operating Officer of Sino Gold Mining Limited, where he oversaw the development and operation of gold mines in China. Mr Johnstone is Chairman of Aurelia Metals Ltd (since November 2016).

Mr Johnstone is the Lead Independent Director, Chair of the Risk Committee, and a member of the Audit Committee.

Mr Johnstone was a former Non-Executive Director of Magnis Resources Ltd; Neometals Ltd (Reed Resources Ltd); and Metallum Ltd.

Thomas (Tommy) McKeith, BSc (Hons), GradDip Eng (Mining), MBA, Non-Executive Director

Mr McKeith is a geologist with 30 years' experience in various mine geology, exploration and business development roles. He was formerly Executive Vice President (Growth and International Projects) for Gold Fields Limited, where he was responsible for global greenfields exploration and project development.

Mr McKeith was also Chief Executive Officer of Troy Resources Limited and has held Non-Executive Director roles at Sino Gold Limited, Avoca Resources Limited and is currently the Non-Executive Chairman of Prodigy Gold NL.

Mr McKeith is the Chair of the Nomination and Remuneration Committee. Subsequent to year end, Mr. McKeith stepped down from the Audit Committee and was appointed as a member of the Risk Committee.

Andrea Hall, BCom, FCA, M. App Fin, GAICD, Non-Executive Director

Ms Hall is a Chartered Accountant with more than 30 years’ experience in the financial services industry in roles involved in internal audit, risk management, corporate and operational governance, external audit, financial management and strategic planning. Prior to retiring from KPMG in 2012, Ms Hall was a Perth-based partner within KPMG’s Risk Consulting Services in industries including mining, mining services,transport, healthcare, insurance, property and government.

Ms Hall is currently a Non-Executive Director and Chair of the Audit and Risk Committee at ASX-listed Pioneer Credit Limited and Automotive Holdings Group Limited. Ms Hall is also a Non-Executive Director of Insurance Commission of Western Australia and the Fremantle Football Club.

Ms Hall became Chair of the Audit Committee in June 2018 and was a member until this date.

Directors' Report

Company Secretary

Evan Elstein, BCom (Accounting and Finance), ACA, FGIA, FCIS

Mr Elstein was appointed as the Company Secretary and Vice President for Information Technology in October 2011 following the merger of Conquest Mining Limited and Catalpa Resources Limited. Previously he served as Company Secretary of Conquest Mining. He is a Chartered Accountant, Chartered Secretary, and a member of Chartered Accountants Australia and New Zealand, the Institute of Chartered Secretaries and Administrators and the Governance Institute of Australia.

Mr Elstein has over 25 years' experience in senior financial, commercial and technology roles, where his responsibilities have included the roll out of IT projects and services, business improvement initiatives and merger and acquisition activities. He has held senior positions with IT consulting companies in Australia, and previously served as the Chief Financial Officer and Company Secretary of Hartec Limited. Prior to that, Mr Elstein held senior finance and operations positions at Dimension Data in South Africa.

Meetings of directors

The numbers of meetings of the Company's Board of Directors and of each Board Committee held during the year ended 30 June 2018, and the numbers of meetings attended by each Director were:

			Meetings of committees	Meetings of committees	Meetings of committees	Meetings of committees	Meetings of committees	Meetings of committees
	Board		Audit		Risk Management		Nomination and Remuneration
	A	B	A	B	A	B	A	B
Jacob (Jake) Klein Lawrence (Lawrie) Conway James (Jim) Askew Graham Freestone Colin (Cobb) Johnstone Thomas (Tommy) McKeith Andrea Hall (i) Naguib Sawiris (ii) Sebastien de Montessus (ii) Vincent Benoit (iii) Amr El Adawy (iii) Andrew Wray (iv)	6 6 6 6 6 6 5 - 3 - - 2	6 6 6 6 6 6 5 6 6 - - 2	- - - 4 4 4 3 - - - - -	- - - 4 4 4 3 - - - - -	- - 2 2 2 - - - - - - -	- - 2 2 2 - - - - - - -	- - 3 - - 3 - - 1 - - 1	- - 3 - - 3 - - 3 - - 1

A = Number of meetings attended

B = Number of meetings held during the time the Director held office or was a member of the committee during the year

(i) Andrea Hall was appointed into her role on 1 October 2017.

(ii) Naguib Sawiris and Sebastien de Montessus resigned from their roles effective 1 August 2018. (iii) Vincent Benoit and Amr El Adawy resigned from their roles effective 19 April 2018. (iv) Andrew Wray was appointed to his role on 19 April 2018 and resigned on 1 August 2018.

Directors' Report

Remuneration Report (Audited)

This Remuneration Report forms part of the Directors' Report for the year ended 30 June 2018. This report contains details of the remuneration paid to the Directors and Key Management Personnel ("KMP") and is aligned to the Company's overall remuneration strategy and framework. The Company's remuneration philosophy and strategy is designed to ensure that the level and composition of remuneration is competitive, reasonable and appropriate for the results delivered and to attract and retain appropriately experienced Directors and employees.

This remuneration report is presented under the following sections:

(a) Remuneration Overview
(b) Remuneration Governance
(c) Remuneration Strategy and Framework
(d) Executive Remuneration Outcomes
(e) Non-Executive Director Remuneration
(f) Other Remuneration Information
(g) Summary of Key Terms

(a) Remuneration Overview

(i) Key Management Personnel

The executive remuneration framework covered in this report includes the Executive Directors (Executive Chairman and Chief Financial Officer) and those executives considered to be Key Management Personnel (“KMP”) named below:

Name	Position
Jacob (Jake) Klein Lawrence (Lawrie) Conway Aaron Colleran Paul Eagle Evan Elstein Bob Fulker (i) Glen Masterman Mark Le Messurier(ii)	Executive Chairman Finance Director and Chief Financial Officer Vice President Business Development & Investor Relations Vice President People & Culture Company Secretary & Vice President Information Technology Chief Operating Officer Vice President Discovery & Chief Geologist Chief OperatingOfficer

(i) Bob Fulker was appointed into his role on 12 February 2018.
(ii) Mark Le Messurier resigned from his role effective 1 January 2018.

(ii) Key Remuneration Outcomes

Key remuneration outcomes for the 2018 financial year are summarised in the table below:

Remuneration	Description
STIP Outcomes	The average STIP outcome for the KMP was 90.3% of the maximum opportunity based on the
	assessment of business and personal measures. This reflects the Company's outstanding operating and
	financialperformance,and improvement in the upgradingof the assetportfolio duringtheyear.
LTIP Outcomes	69.3 % of the Performance Rights awarded during the 2016 financial year and tested as at 30 June 2018
	vested on 16 August 2018. This reflects the Company's continued strong performance during the three
	years to 30 June 2018.
	The Performance Rights awarded during the 2015 financial year were tested as at 30 June 2017, with
	100% of the Performance Rights meeting their performance measures and were approved by the Board
	on 16 August 2017 to vest.
KMP Remuneration	Five of the KMP received increases to their fixed remuneration duringthe 2018 financialyear.
NED Remuneration	Non-Executive Directors did not receive anyincrease to their fees duringtheyear.

(iii) What has changed in relation to remuneration during the 2018 financial year

No key changes to the executive remuneration framework have been implemented during the 2018 financial year.

Directors' Report

Remuneration Report (Audited) (continued)

(a) Remuneration Overview (continued)

(iv) What changes are planned for remuneration in the 2019 financial year

Commencing in the 2019 financial year, the Long Term Incentive Plan is to be extended down one level in the organisation.

(b) Remuneration Governance

The Board of Directors (“the Board”) has an established Nomination and Remuneration Committee, consisting solely of Non-Executive Directors, with the delegated responsibility to report on and make recommendations to the Board on the:

Appropriateness of the remuneration policies and systems, having regard to whether they are:
Relevant to the Company’s wider objectives and strategies;
Legal and defensible;
In accordance with the human resource objectives of the Company;
Performance of the Executive Directors (on an annual basis) and ensure there is a process for determining key performance indicators for the ensuing period; and
Remuneration of the Executive Directors, Non-Executive Directors and Key Management Personnel, in accordance with approved Board policies and processes.

(c) Remuneration Strategy and Framework

The executive remuneration framework has been designed to align Executive Directors and KMP objectives with shareholder and business objectives by offering a remuneration package based on key performance areas affecting the Company's overall performance. The Board believes the remuneration framework to be strategic, appropriate and effective in its ability to attract and retain KMP and to operate and manage the Company effectively.

The Group's target remuneration philosophies are:

Total Fixed Remuneration - TFR (being salary, superannuation, plus regular allowances) positioned at the median (50th percentile) based on the industry benchmark McDonald report (an industry recognised gold and general mining remuneration benchmarking survey covering over 97 organisations within the industry);
Total Annual Remuneration - TAR (TFR plus STI) at target at the 75th percentile for high performers; and
Total Remuneration - TR (TAR plus LTI) at the 75th percentile, with flexibility to provide up to the 90th percentile levels for high performers and critical roles.

The overarching objectives and principles of the Group’s remuneration strategy are that:

Total remuneration for each level of the workforce is appropriate and competitive;
Total remuneration comprises a competitive fixed component and a sizeable “at risk” component based on performance hurdles;
Short term incentives are appropriate with hurdles that are measurable, transparent and achievable;
Incentive plans are designed to motivate and incentivise for high performance and delivery on organisational objectives;
The corporate long term incentives are focussed on shareholder value; and
The principles and integrity of the remuneration review process deliver fair and equitable outcomes.

Directors' Report

Remuneration Report (Audited) (continued)

(c) Remuneration Strategy and Framework (continued)

The following table outlines the remuneration components for all KMP for the 2018 financial year:

Component	Performance measure	Strategic objective
Total Fixed Remuneration (TFR)	Key results areas for the role are	Remuneration is designed to attract,
	determined based on the individual's	motivate and retain key personnel.
	position and key business imperatives.	Considerations include:
		• Overall Company business plan
		• External market conditions
		• Key employee value drivers
		• Individual employee performance
		• Industrybenchmark data
Short Term Incentive (STI)	Key Performance indicators are set with a	The objective is to motivate employees to
	mix of individual and corporate elements.	achieve key annual targets focussed on
	The relative weighting of which is	safety, operations, cash contribution, and
	dependent on the individual employee job	effective cost management, improving the
	banding and position. For the Executive	overall quality of the asset portfolio and
	Chairman, the weighting is 70% corporate	driving a high achievement team culture.
	and 30% individual and for the remainder
	of the KMP, 60% corporate and 40%
	individual. For the corporate component
	for FY18, the measures focussed on
	safety, cash contribution, costs and
	strategic imperatives focused on
	delivering the Cowal projects to plan,
	improving the portfolio quality (including
	M&A and divestments; Discovery and
	LOM Plans), delivery of key business
	improvement projects, while making
	tangible progress with the Discovery
	strategy through the identification and
	acquisition of newprojects.
Long Term Incentive (LTI)	Performance measures agreed with the	The primary objective to deliver industry
	Board have a 3 year time horizon and are	leading shareholder returns.
	focussed on enhancing shareholder
	value.

Directors' Report

Remuneration Report (Audited) (continued)

(c) Remuneration Strategy and Framework (continued)

The target achievement remuneration ratio mix for Executive Directors and KMP for the 2018 financial year and prior financial year is as follows:

==> picture [427 x 228] intentionally omitted <==

(d) Executive Remuneration Outcomes

(i) Financial Performance

The Group has demonstrated strong performance over the past five years. The following table breaks down the key performance indicators for the Group over this time frame:

	2018	2017	2016	2015	2014
Statutory profit/(loss) for the year ($'000)	263,388	217,607	(24,349)	100,115	50,017
Underlying profit for the year after income tax ($'000) (i)	250,762	206,588	134,496	106,050	50,017
EBITDA ($'000)	795,083	713,855	607,551	272,656	207,556
Basic earnings per share (cents)	15.57	13.28	(1.75)	13.71	7.06
Dividends declared (cents per share)	7.5	5.0	3.0	2.0	2.0
Shareprice($)at 30 June closing	3.51	2.41	2.33	1.15	0.70

(i) Refer to the Profit Overview section in the Operating and Financial Review for a reconciliation of the underlying profit for the year.

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(ii) STIP

(ii) STIP	(ii) STIP
Component Performance measure Participation The Overall Group STIP applies to site based employees at the level of Manager and all Group office employees.
Composition The Group STIP is a cash bonus, up to a maximum percentage of TFR, based on the employee job band.
Performance conditions It is assessed and paid annually conditional upon the achievement of key company objectives and individual KPIs. For the 2018 financial year, the company objectives were focussed in the areas of safety, groupcash contribution, production,costs and a strategic imperative element.
Award parameters The Group STIP is currently set at between 10% and 60% of TFR for Target achievement, with a maximum of 20%-90% of TFR for Stretch achievement, depending on the employee job band. Details of the Group STIP paid to the Directors and KMP are shown in the Remuneration Table in section d(iv). The Group's performance against the STI Scorecard for FY18 is as follows: STIP Scorecard Target (100%) STIP Weighting Result Award HSE SSO Frequency Rate (SSOFR) 4.2 20% 3.2 30% Environmental Critical Controls Compliance - top3 Hazards(%) 90% 10% 80% 5% Profitability Group Cash Contribution ($ million) 270 20% 386 30% GroupAll In Costs($/oz sold) 1,140 20% 1,045 30% Strategic Imperatives Discretionary 100% 30% 135% 40.5% Total 100% 135.5%
	STIP Scorecard Target (100%) STIP Weighting Result Award
	HSE SSO Frequency Rate (SSOFR) 4.2 20% 3.2 30% Environmental Critical Controls Compliance - top3 Hazards(%) 90% 10% 80% 5%
	Profitability Group Cash Contribution ($ million) 270 20% 386 30% GroupAll In Costs($/oz sold) 1,140 20% 1,045 30%
	Strategic Imperatives Discretionary 100% 30% 135% 40.5%
	Total 100% 135.5%
FY18 STIP considerations	At the time of setting the FY18 STIP measures, the Board determined it would consider the following factors when awarding the score for the strategic imperatives measure: • Delivery to plan of the Cowal projects • Improvement in the portfolio quality (covering M&A, divestments, Discovery and LOM Plans) • Delivery of the key business improvement projects; and • Advancement in the discovery area: - Identification and acquisition of at least one new advanced project - Generate or acquire at least 3 new explorationprojects at drill test or target definition stage
Award outcome for the year	The Board approved a discretionary score of 135.0% for the following reasons: • The Float Tails Leach project progressed to plan with commissioning ready for H1 FY19. The establishment activities for Stage H were completed ahead of schedule and under budget. The mining of Stage H finished ahead of the accelerated development plan and costs remain on budget. The steering committee reviews were undertaken every month with dashboard tracking of all projects at Cowal in place. The project team established at Cowal is highly skilled and establishing good standards for project execution. • The sale of Edna May was successfully completed. Evolution demonstrated it is a good seller, not only in terms of portfolio management, but in how we dealt with the Edna May workforce and transitioned service and processes to the new owner. • Discovery program gained good momentum throughout FY18, with 3 new early stage exploration projects added to the portfolio, including the acquisition of the Connors Arc project and 10 prospects across the Company’s operations were advanced to the next stage of exploration. • Life of Mines have improved with focus being applied towards further improvements in FY19. • During FY18, $28.3 million of value beyond budget was achieved with all operations contributing to the result through improvements in productivity and commercial contract terms and efficiency gains.

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(ii) STIP (continued)

Component	Performance measure
	2018 Total STIP Granted ($) % of Maximum Entitlement Granted % of Maximum Entitlement Forfeited
	Directors
	Jacob Klein 657,000 90.8% 9.2% Lawrie Conway 480,000 88.9% 11.1%
	Key Management Personnel
	Aaron Colleran 375,000 89.7% 10.3% Paul Eagle 300,000 87.8% 12.2% Evan Elstein 310,000 85.1% 14.9% Bob Fulker (i) 170,000 86.3% 13.7% Glen Masterman 350,000 91.5% 8.5% Mark Le Messurier(ii) 150,000 74.2% 25.8%

(i) Bob Fulker was appointed into his role on 12 February 2018. His STIP is pro-rated for his period of employment. (ii) Mark Le Messurier resigned from his role effective 1 January 2018. His STIP is pro-rated for his period of employment.

(iii) LTIP

Component	Performance measure
Participation	The GroupLTIP applies to employees at the level of Manager and above across the Group.
Performance period	Up to 3 years.
Composition	The Company has one long term incentive plan currently in operation, the Employee Share Option and Performance Rights Plan (“ESOP”). The Employees and Contractors Plan (ECOP) and the Option component of the ESOP are now effectively dormant with no new options to be issued under these plans. All remaining Options either expired or were exercised during the previous financial year. The ESOP (approved by shareholders on 23 November 2010, 26 November 2014 and 23 November 2017) provides for the issuance of Performance Rights to Executive Directors and eligible employees. This LTIP was introduced for employees at the level of Manager and above, effective from 1 July 2011 and provides equity based “at risk” remuneration, up to maximum percentages, based on, and in addition to, each eligible employee’s TFR. These incentives are aimed at retaining and incentivising KMP and senior managers on a basis that is aligned with shareholder interests, and are provided via Performance Rights.
Performance conditions	The Performance Rights are issued for a specified period and each Performance Right is convertible into one ordinary share. All Performance Rights expire on the earlier of their expiry date or termination of the employee’s employment subject to Director discretion. Performance Rights do not vest until a specified period after granting and their exercise is conditional on the achievement of certain performance hurdles that are aligned with shareholder interests. There are no voting or dividend rights attached to the Performance Rights. Voting rights will attach to the ordinary shares when the Performance Rights vest. Unvested Performance Rights cannot be transferred and will not be quoted on the ASX.
Award parameters Further details on each of the performance conditions laid out below are detailed in Section f(i) - 'Other Remuneration Information'.

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(iii) LTIP (continued)

Component	Performance Measure	Performance Measure	Performance Measure
	Performance Target Description Weighting for each year from FY15 grants
	(i) TSR Performance The Group’s relative total shareholder return (TSR) measured against the TSR for a peer Company of 20 comparator gold mining companies (Peer Group) 25% (ii) Absolute TSR performance The Group’s absolute TSR return 25% (iii) Growth in Earnings per share Growth in the Group’s Earnings per share 25% (iv) Increase in ore reserves per share Increasing the ore reserves per share over a 3 year period 25%
FY18 LTIP considerations	Each year an assessment is made by the Directors against performance hurdles and guidelines established by the Board. In exercising their discretion under the rules, the Directors will take into account matters such as the position of the eligible person, the role they play in the Group, the nature or terms of their employment or contract and the contribution theymake to the Groupas a whole. At 30 June 2018 there were no Options outstanding (FY17: nil)
ECOP Options
		2018 2017
		Number Number
	Outstanding balance at the beginning of the year Issued during the period Exercised during the period Expired during the period Outstanding balance at the end of theyear	- 52,954 - - - - - (52,954)
		- -
ESOP Options	At 30 June 2018 there were no Options outstanding (FY17: nil)
		2018 2017
		Number Number
	Outstanding balance at the beginning of the year Issued during the period Exercised during the period Expired during the period Outstanding balance at the end of theyear		- 5,150,390 - - - (4,178,661) - (971,729)
			- -
Award outcome for the year - ESOP Performance Rights	Outcomes for the FY15 award which vested during the year	are set out as follows:
	Performance Target Measure	FY15 Outcome % Vested
	(i) TSR Performance Percentile 5th 25% (ii) Absolute TSR performance Compound annual return 53% 25% (iii) Growth in Earnings per share Compound annual return 20% 25% (iv) Increase in ore reserves per share Percentage increase 128% 25%

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(iii) LTIP (continued)

Component	Performance Measure	Performance Measure
	Outcomes for the FY16 award which will vest in August 2018 are set out as follows:
	Performance Target Measure FY16 Outcome % Vested
	(i) TSR Performance Percentile 20th 19% (ii) Absolute TSR performance Compound annual return 42% 25% (iii) Growth in Earnings per share Compound annual return 2% 0% (iv) Increase in ore reserves per share Percentage increase 136% 25%
	The movement in Performance Rights under thisplan is in the table below:
		2018 2017
		Number Number
	Outstanding balance at the beginning of the year Performance Rights granted (withdrawn) during the period pursuant to Retention Agreement Performance Rights granted during the period pursuant to Transition Incentive Plan Performance rights granted during the period Vested during the period Lapsed during the period Forfeited during the period Outstanding balance at the end of theyear	26,278,566 29,429,811 - (3,750,000) - 3,375,000 6,586,571 6,797,540 (9,214,401) (7,961,146) - - (2,708,126) (1,612,639)
		20,942,610 26,278,566

*The 3,750,000 Performance Rights granted in December 2015 to Mr. Jake Klein were withdrawn pursuant to a Transition Incentive Plan (TIP) under the Retention Agreement which the Company has entered into with Mr. Klein. Under the Plan the Company granted 3,375,000 Performance Rights to Mr. Klein subject to the satisfaction of Vesting Conditions to be tested as at 16 December 2019 and were approved by shareholders at the shareholder meeting held on 21 June 2017.

The table below reflects the Performance Rights granted, vested, or lapsed in each financial year:

	FY14	FY15	FY16	FY17	FY18	Running
						Balance
Granted	10,498,408	10,804,370	8,141,368	6,797,540	6,586,571	42,828,257
Granted - TIP	-	-	-	3,375,000	-	3,375,000
Vested	(7,961,147)	(9,214,401)	-	-	-	(17,175,548)
Lapsed	-	-	-	-	-	-
Forfeited	(2,537,261)	(1,589,969)	(2,279,972)	(1,022,779)	(655,118)	(8,085,099)
Subject to vesting	-	-	5,861,396	9,149,761	5,931,453	20,942,610
Testing date	30/06/16	30/06/17	30/06/18	30/06/19	30/06/2020	-
Testing date - TIP	-	-	-	16/12/19	-	-
Vesting (%)	100%	100%	69.3%	-	-	-

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(iv) Remuneration summary table

		Total Fixed		Post-Employment	Post-Employment	STI		LTI
		Remuneration		Benefits
	Base Salary and Fees		Superannuation		Bonus		Amortised Value (i)		Other	Benefits (ii)	Total
	2018	2017	2018	2017	2018	2017	2018	2017	2018	2017	2018	2017
Directors
Jacob Klein	1,083,752	984,184	20,048	19,616	657,000	610,000	2,883,090	1,218,472	-	-	4,643,890	2,832,272
Lawrie Conway	714,952	665,384	20,048	19,616	480,000	475,000	259,061	301,828	-	-	1,474,061	1,461,828
James Askew	115,000	113,750	-	-	-	-	37,633	18,690	-	-	152,633	132,440
Graham Freestone	118,721	115,867	11,279	11,007	-	-	37,633	18,690	-	-	167,633	145,564
Andrea Hall (iii)	71,918	-	6,832	-	-	-	25,031	-	-	-	103,781	-
Colin Johnstone	135,000	133,125	-	-	-	-	37,633	18,690	-	-	172,633	151,815
Thomas McKeith	109,589	107,877	10,411	10,248	-	-	37,633	18,690	-	-	157,633	137,787
Naguib Sawiris (iv)	95,000	95,000	-	-	-	-	37,633	18,690	-	-	132,633	113,690
Sebastien de Montessus (iv)	105,000	104,375	-	-	-	-	37,633	18,690	-	-	142,633	123,065
Key Management Personnel
Aaron Colleran	444,952	409,368	20,048	19,616	375,000	391,500	243,688	337,130	-	-	1,083,688	1,157,614
Paul Eagle	359,952	335,384	20,048	19,616	300,000	265,000	201,628	212,628	-	-	881,628	832,628
Evan Elstein	384,952	373,718	20,048	19,616	310,000	300,000	217,642	285,293	-	-	932,642	978,627
Bob Fulker (v)	195,668	-	10,024	-	170,000	-	57,554	-	173,395	-	606,641	-
Glen Masterman (vi)	404,952	362,435	20,048	17,980	350,000	300,000	307,301	107,809	-	-	1,082,301	788,224
Mark Le Messurier (vii)	214,976	430,384	10,024	19,616	150,000	335,000	226,102	364,530	368,352	-	969,454	1,149,530
	4,554,384	4,230,851	168,858	156,931	2,792,000	2,676,500	4,646,895	2,939,830	541,747	-	12,703,884	10,004,112

(i) Amortised value of share based rights comprises the fair value of options and performance rights expensed during the year for KMP, and retention rights for NED. (ii) Other benefits include relocation costs and a sign on bonus for Bob Fulker and termination benefits for Mark Le Messurier. (iii) Andrea Hall was appointed into her role on 1 October 2017.

(iv) Naguib Sawiris and Sebastien de Montessus resigned from their roles effective 1 August 2018. (v) Bob Fulker was appointed into his role on 12 February 2018.

(vi) Glen Masterman was appointed into his role on 1 August 2016.

(vii) Mark Le Messurier resigned from his role effective 1 January 2018.

Directors' Report

Remuneration Report (Audited) (continued)

(d) Executive Remuneration Outcomes (continued)

(v) Executive service agreements Remuneration and other key terms of employment for the Executive Directors and KMP are formalised in the Executive Services Agreements table below:

Name	Term of	Total Fixed	Notice Period by	Notice period by	Termination
	agreement and	Remuneration	Executive	Evolution	payments (i)
	noticeperiod
Existing Executive Directors	and Key Management Personnel
Jacob Klein Executive Chairman	Open	803,800 300,000 fixed Director's Fees	6 months	6 months	12 month Total Fixed Remuneration
Aaron Colleran Vice President Business Development and Investor Relations	Open	475,000	3 months	6 months	6 months Total Fixed Remuneration
Lawrie Conway		610,000			6 months
Finance Director and Chief	Open	135,000 fixed	3 months	6 months	Total Fixed
Financial Officer		Director's Fees			Remuneration
Paul Eagle					6 months
Vice President People and	Open	395,000	3 months	6 months	Total Fixed
Culture					Remuneration
Evan Elstein Company Secretary and Vice President Information Technology	Open	412,500	3 months	6 months	6 months Total Fixed Remuneration
Bob Fulker (ii) Chief Operating Officer	Open	525,000	3 months	6 months	6 months Total Fixed Remuneration
Glen Masterman					6 months
Vice President Discovery and					Total Fixed
Chief Geologist	Open	440,000	3 months	6 months	Remuneration

(i) For a change of control event, the termination payment is 12 months TFR for Executive Directors and KMP. (ii) Bob Fulker was appointed into his role on 12 February 2018.

Fixed salary, inclusive of the required superannuation contribution amount, is reviewed annually by the Board following the end of the financial year. The amounts set out above are the Executive Directors and KMP total fixed remuneration as at the date of this report.

(e) Non-Executive Director Remuneration Outcomes

The Board policy is to remunerate Non-Executive Directors (NEDs) at market rates for comparable companies for time, commitment and responsibilities. The Nomination and Remuneration Committee determines Non-Executive Directors fees and reviews this annually, based on market practice, their duties and areas of responsibility. 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 (currently $950,000 per annum). Fees for Non-Executive Directors are not linked to the performance of the Group and they currently do not participate in the Group’s STIP or LTIP.

Under the NED Equity Plan, NEDs will be granted Share Rights as part of their remuneration. The number of Share Rights granted will be calculated in accordance with the following formula:

“Equity Amount” ($) for the financial year/Value per Share Right

Directors' Report

Remuneration Report (Audited) (continued)

(e) Non-Executive Director Remuneration Outcomes (continued)

Where:

“Equity Amount” is an amount determined by the Board, having regard to level of board and committee fees paid in cash and independent advice received. For 2018, the Equity Amount is $40,000 for each NED.
The Value per Share Right = the volume weighted average price (VWAP) of Evolution’s ordinary shares traded on the ASX over the 5 trading day period up to and including 30 June each year. For FY2018, the VWAP used to determine the number of share rights granted to each NED was $2.3957.

Providing the NED remains a director of Evolution, Share Rights will vest and automatically exercise 12 months after the grant date. The Share Rights granted to NEDs under the NED Equity Plan are not subject to performance conditions or service requirements which could result in potential forfeiture. Vested Share Rights will convert into ordinary shares on a one-for-one basis. Vested Share Rights will be satisfied by either issuing shares or arranging for shares to be acquired on-market, subject to the Evolution Securities Trading Policy and the inside information provisions of the Corporations Act.

Upon the transfer to the relevant NED, the shares will be subject to disposal restrictions (Disposal Conditions) under the earlier of:

the NED ceasing to be a director of Evolution; or
3 years from the date of grant of the share rights or such longer period nominated by the NED at the time of the offer (up to a maximum 15 years from the date of grant).

Generally, Share Rights will lapse if a Participant ceases to be a Director of the Company.

Broken out in the table below is a summary of the fee structure by individual as at 30 June 2018. For remuneration outcomes please refer to table in section d (iv). Note that a change in Board Sub-Committee fees was implemented during the year.

			Cash Component($)	Cash Component($)		Equity ($)
	Base Fees	Lead	Sub-Committee	Sub-Committee	Total Cash	NED Equity	Total per
		Independent	Chairman	Member	Fees	Plan Shares	annum($)
Directors
James Askew	95,000	-	-	20,000	115,000	40,000	155,000
Graham Freestone	95,000	-	25,000	10,000	130,000	40,000	170,000
Andrea Hall (i)	71,250	-	-	7,500	78,750	40,000	118,750
Colin Johnstone	95,000	15,000	15,000	10,000	135,000	40,000	175,000
Thomas McKeith	95,000	-	15,000	10,000	120,000	40,000	160,000
Naguib Sawiris (ii)	95,000	-	-	-	95,000	40,000	135,000
Sebastien de	95,000	-	-	10,000	105,000	40,000	145,000
Montessus(ii)
	641,250	15,000	55,000	67,500	778,750	280,000	1,058,750

(i) Andrea Hall was appointed into her role on 1 October 2017. (ii) Naguib Sawiris and Sebastien de Montessus resigned from their roles effective 1 August 2018.

Directors' Report

Remuneration Report (Audited) (continued)

(f) Other Remuneration Information

(i) LTIP performance parameters

Component	Assessment	Assessment	Assessment
TSR Performance	The Group's TSR will be based on the percentage by which its 30-day volume weighted average share price quoted on ASX (“VWAP”) at the close of trade on the Relevant Date (plus the value of any dividends paid during the performance period) has increased over the Group’s applicable 30-day VWAP at the close of trade,relatingto thegrant of Performance Rights for thatperiod.
	Level of performance achieved Evolution TSR performance as compared to the Peer Group TSR % of TSR Performance Rights vesting
	Threshold Top 50th percentile 33% Above the top 50th percentile and below the top25thpercentile Straight-line pro-rata between 33% and 66%
	Target Top 25th percentile 66% Above the top 25th percentile and below the top10thpercentile Straight-line pro-rata between 66% and 100%
	Exceptional Top10thpercentile or above 100%
Absolute TSR performance	Performance rights will be will be tested against the Group’s Absolute TSR performance relative to the 30 days VWAP (Absolute TSR Performance Rights) as at 30 June 2018, 30 June 2019 and 30 June 2020 respectively,measured as the cumulative annual TSR over the threeyearperformanceperiod.
	Level of performance achieved	Evolution Absolute TSR performance	% of Absolute TSR Performance Rights vesting
	Threshold	10% Per Annum Return Above 10% Per Annum Return and below 15% Per Annum Return	33% Straight-line pro-rata between 33% and 66%
	Target	15% Return Per Annum Above 15% Per Annum Return and below 20% Per Annum Return	66% Straight-line pro-rata between 66% and 100%
	Exceptional	Above 20% Per Annum Return	100%
Growth in earnings per share A proportion of Performance Rights granted during the years ended 30 June 2016, 30 June 2017 and 30 June 2018 and those to be granted during the year ended 30 June 2019, will be tested against the Group’s growth in Earnings Per Share, calculated by excluding any Non-Recurring Items, and measured as the cumulative annualgrowth rate over the threeyearperformanceperiod. Level of performance achieved Evolution Earnings per share performance % of Earnings Per Share Performance Rights vesting Threshold 7% Per Annum Growth in EPS 33% Above 7% Per Annum Growth in EPS and below 11% Per Annum Growth in EPS Straight-line pro-rata between 33% and 66% Target 11% Per Annum Growth in EPS 66% Above 11% Per Annum Growth in EPS and below 15% Per Annum Growth in EPS Straight-line pro-rata between 66% and 100% Exceptional Above 15% Per Annum Growth in EPS 100%
	Level of performance achieved Evolution Earnings per share performance % of Earnings Per Share Performance Rights vesting
	Threshold 7% Per Annum Growth in EPS 33% Above 7% Per Annum Growth in EPS and below 11% Per Annum Growth in EPS Straight-line pro-rata between 33% and 66%
	Target 11% Per Annum Growth in EPS 66% Above 11% Per Annum Growth in EPS and below 15% Per Annum Growth in EPS Straight-line pro-rata between 66% and 100%
	Exceptional Above 15% Per Annum Growth in EPS 100%

Directors' Report

Remuneration Report (Audited) (continued)

(f) Other Remuneration Information (continued)

(i) LTIP performance parameters (continued)

Component	Assessment
Increase in ore	A proportion of Performance Rights will be tested against the Group’s ability to grow its Ore Reserves,
reserves per share	calculated by measuring the growth over the three year performance period by comparing the baseline
	measure of the Ore Reserves as at 31 December (“Baseline Ore Reserves”) to the Ore Reserves as at
	31 December three years later on a per share basis, with testing to be performed at 30 June 2018, 30
	June 2019 and 30 June 2020.
	Level of	Evolution Growth in Ore Reserves	% of Growth in Ore Reserves
	performance	per share performance	Performance Rights vesting
	achieved
	Threshold	90% of Baseline Ore Reserves	33%
		Above 90% of Baseline Ore Reserves	Straight-line pro-rata between 33%
		but below 100% Baseline Ore	and 66%
		Reserves
	Target	100% Baseline Ore Reserves	66%
		Above 100% of Baseline Ore	Straight-line pro-rata between 66%
		Reserves and below 120% of Baseline	and 100%
		Ore Reserves
	Exceptional	120% and above of Baseline Ore	100%
		Reserves

Directors' Report

Remuneration Report (Audited) (continued)

(f) Other Remuneration Information (continued)

(ii) Director and key management personnel equity holdings

	Balance at the	Received during	Received during	Other changes	Balance at the
	start of the year	the year on	the year on		end of the year
		conversion of	exercise of
		performance	options
		rights
Directors
Jacob Klein	10,470,058	2,229,965	-	-	12,700,023
Lawrie Conway	156,923	536,347	-	-	693,270
James Askew	757,289	16,298	-	-	773,587
Graham Freestone	114,207	16,298	-	-	130,505
Andrea Hall (i)	-	-	-	-	-
Colin Johnstone	108,969	16,298	-	-	125,267
Thomas McKeith	156,923	16,298	-	-	173,220
Naguib Sawiris (ii) (iii)	-	16,298	-	-	16,298
Sebastien de Montessus (iii)	-	16,298	-	-	16,298
Amr El Adawy (iv)	11,333	-	-	(11,333)	-
Key Management Personnel
Aaron Colleran	667,836	-	-	(637,836)	30,000
Paul Eagle	280,842	-	-	(113,842)	167,000
Evan Elstein	449,095	411,200	-	(290,295)	570,000
Bob Fulker (v)	-	-	-	-	-
Mark Le Messurier (vi)	937,933	536,347	-	(121,538)	1,352,742
Glen Masterman	-	-	-	-	-
	14,111,408	3,811,647	-	(1,174,844)	16,748,210

(i) Andrea Hall was appointed into her role on 1 October 2017.

(ii) At 30 June 2018, La Mancha had a relevant interest in 253,891,807 Evolution shares, representing approximately 15% of Evolution’s issued capital. Subsequent to the year end, it was announced that La Mancha had undertaken a block trade monetisation of shares, reducing its direct interest in Evolution to 9.6%.

(iii) Naguib Sawiris and Sebastien de Montessus resigned from their roles effective 1 August 2018. (iv) Amr El Adawy resigned as Alternate Non-Executive Director on 19 April 2018.

(v) Bob Fulker was appointed into his role on 12 February 2018.

(vi) Mark Le Messurier resigned from his role effective 1 January 2018.

Directors' Report

Remuneration Report (Audited) (continued)

(f) Other Remuneration Information (continued)

(ii) Director and key management personnel equity holdings (continued) Performance and Share Rights

	At end of theyear
Balance at the start of theyear Granted as compen- sation Converted Lapsed Other changes Balance at the end of the year Vested and exercisable Unvested
Directors
Jacob Klein 7,778,641 692,165 (2,229,965) (428,590) - 5,812,251 968,607 4,843,644 Lawrie Conway 1,177,637 369,050 (536,347) (102,832) - 907,508 232,400 675,108 James Askew 16,298 16,697 (16,298) - - 16,697 - 16,697 Graham Freestone 16,298 16,697 (16,298) - - 16,697 - 16,697 Andrea Hall (i) - 16,697 - - - 16,697 - 16,697 Colin Johnstone 16,298 16,697 (16,298) - - 16,697 - 16,697 Thomas McKeith 16,298 16,697 (16,298) - - 16,697 - 16,697 Naguib Sawiris (ii) 16,298 16,697 (16,298) - - 16,697 - 16,697 Sebastien de Montessus(ii) 16,298 16,697 (16,298) - - 16,697 - 16,697
Key Management Personnel
Aaron Colleran 1,089,289 286,014 - (95,280) - 1,280,023 538,807 741,216 Paul Eagle 665,043 233,732 - (52,559) - 846,216 373,050 473,166 Evan Elstein 938,252 249,109 (411,200) (84,551) - 691,610 191,084 500,526 Bob Fulker (iii) - 322,919 - - - 322,919 - 322,919 Mark Le Messurier (iv) 1,177,637 276,787 (536,347) (102,832) - 815,245 232,400 582,845 Glen Masterman 276,080 261,410 - - - 537,490 - 537,490
13,200,367 2,808,065 (3,811,647) (866,644) - 11,330,141 2,536,348 8,793,793

(i) Andrea Hall was appointed into her role on 1 October 2017.

(ii) Naguib Sawiris and Sebastien de Montessus resigned from their roles effective 1 August 2018. (iii) Bob Fulker was appointed into his role on 12 February 2018.

(iv) Mark Le Messurier resigned from his role effective 1 January 2018.

(g) Summary of Key Terms

Below is a list of key terms with definitions used within the Director’s Report:

Key Term	Definition
The Board of Directors (“the	The Board of Directors, the list of persons under the relevant section above.
Board” or “the Directors”)
Key Management Personnel	Senior executives have the authority and responsibility for planning, directing and
("KMP")	controlling the activities of the Company and are members of the senior leadership team.
	KMP for the financial year ended 30 June 2018 are listed above.
Total Fixed Remuneration	Total Fixed Remuneration comprises a base salary plus superannuation. This is currently
("TFR")	positioned at the median (50th percentile) of the industry benchmarking report.
Short Term Incentive ("STI")	STI is the short-term incentive component of Total Remuneration. The STI usually
and Short Term Incentive Plan	comprises a cash payment that is only received by the employee if specified annual
(“STIP”)	goals are achieved. STIP refers to the plan under which the incentives are granted and
	paid.

Directors' Report

Remuneration Report (Audited) (continued)

(g) Summary of Key Terms (continued)

Key Term	Definition
Long Term Incentive ("LTI") and	LTI is the long-term incentive component of Total Remuneration. The LTI comprises of
Long term Incentive Plan	Performance Rights, usually with a three year vesting period that are subject to specified
(“LTIP”)	vesting conditions established by the Board. Further details of the vesting conditions
	associated with the performance rights are detailed in the Vesting Conditions of
	Performance Rights section. Performance Rights cannot be exercised unless the vesting
	conditions have been satisfied. LTIP refers to the plan under which LTIs are granted and
	is aimed at retaining and incentivising KMP and senior managers to achieve business
	objectives that are aligned with shareholder interests, and are currently provided via
	Performance Rights.
Total Annual Remuneration	Total Fixed Remuneration plus STI.
Total Remuneration	Total Fixed Remuneration plus STI and LTI.
Superannuation Guarantee	This is the employer contribution to an employee nominated superannuation fund
Charge ("SGC")	required by law. The percentage contribution was set at 9.5% in the reporting period and
	is capped in line with the SGC maximum quarterly payment.
Employees and Contractors	The plan permits the Company, at the discretion of the Directors, to grant Options over
Option Plan ("ECOP")	unissued ordinary shares of the Company to eligible Directors, members of staff and
	contractors as specified in the plan rules. The plan is currently dormant and no further
	Options will be issued under this plan.
Employee Share Option and	The plan permits the Company, at the discretion of the Directors, to grant both Options
Performance Rights Plan	and Performance Rights over unissued ordinary shares of the Company to eligible
("ESOP")	Directors and members of staff as specified in the plan rules.
NED Equity Plan	The plan permits the Company, at the discretion of the Board and Remuneration
	Committee to issue remuneration to Non-Executive Directors through Share Rights.
Total Shareholder Return	TSR is the total return on an ordinary share to an investor arising from growth in the
("TSR")	share price plus any dividends received.
Key Performance Indicators	A form of performance measurement for individual performance against a pre-defined set
("KPIs")	of goals.
Volume Weighted Average	A 30 day volume weighted average share price quote on the Australian Stock Exchange
Share Price (“VWAP”)	(ASX). The VWAP is to be used when assessing Company performance for TSR.
Fees	Fees paid to Executive and Non-Executive Directors for services as a Director, including
	sub-committee fees as applicable.

Directors' Report

Indemnification of officers and auditors

During the financial year the Company paid a premium in respect of a contract insuring the Directors of the Company, the company secretaries and all executive officers of the Company and of any related body corporate against a liability incurred as such a Director, secretary or executive officer to the extent permitted by the Corporations Act 2001 . The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

The Company has entered into a Deed of Indemnity, Insurance and Access with each Director. In Summary the Deed provides for:

Access to corporate records for each Director for a period after ceasing to hold office in the Company;
The provision of Directors and Officers Liability Insurance; and
Indemnity for legal costs incurred by Directors in carrying out the business affairs of the Company.

Except for the above the Company has not otherwise, during or since the financial year, except to the amount permitted by law, indemnified or agreed to indemnify an officer or auditor of the Company or of any related body corporate against a liability incurred as such an officer or auditor.

Proceedings on behalf of the company

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to 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 part of those proceedings.

No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of the Corporations Act 2001.

Non-audit services

The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor's expertise and experience with the Company and/or the Group are important.

Details of the amounts paid or payable to the auditor (PricewaterhouseCoopers) for non-audit services provided during the year are set out below. Details of the amounts paid or payable to the auditor for audit services provided during the year are set out in note 25(a).

The board of Directors has considered the position and, in accordance with advice received from the audit committee, is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 . The Directors are satisfied that the provision of non-audit services by the auditor, as set out below, did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:

all non-audit services have been reviewed by the audit committee to ensure they do not impact the impartiality and objectivity of the auditor
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants.

Directors' Report

Non-audit services (continued)

During the year the following fees were paid or payable for non-audit services provided by the auditor of the parent entity, its related practices and non-related audit firms:

	2018 $ 2017 $
Other assurance services PricewaterhouseCoopers firm: Assurance related services Non PricewaterhouseCoopers audit firms Internal audit services Other assurance services *Total remuneration for other assurance services* SPACE Taxation services PricewaterhouseCoopers firm: Tax compliance services Tax advisory services Non PricewaterhouseCoopers audit firms Tax compliance services Tax advisory services *Total remuneration for taxation services* SPACE SPACE *Total remuneration for non-audit services*	- 140,413 168,971 114,348 259,965 20,000
	428,936 274,761
	- 89,391 8,670 402,939 397,215 111,861 254,242 291,424
	660,127 895,615
	1,089,063 1,170,376

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 39.

Rounding of amounts

The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors Reports) Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to the 'rounding off' of amounts in the Directors' Report. Amounts in the Directors' Report have been rounded off in accordance with that ASIC Corporations Instrument to the nearest thousand dollars, or in certain cases, to the nearest dollar.

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

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Jacob (Jake) Klein Executive Chairman

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Andrea Hall Chair of the Audit Committee

Sydney

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Auditor’s Independence Declaration

As lead auditor for the audit of Evolution Mining Limited for the year ended 30 June 2018, I declare that to the best of my knowledge and belief, there have been:

(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Evolution Mining Limited and the entities it controlled during the period.

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Marc Upcroft Partner PricewaterhouseCoopers

Sydney 17 August 2018

==> picture [468 x 15] intentionally omitted <==

PricewaterhouseCoopers, ABN 52 780 433 757

One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001 T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au

Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124 T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au

Liability limited by a scheme approved under Professional Standards Legislation.

Consolidated Statement of Profit or Loss and Other Comprehensive Income

Notes 30 June 2018 $'000 30 June 2017 $'000	Notes 30 June 2018 $'000 30 June 2017 $'000
Sales revenue 2 Cost of sales 2 Gross Profit Interest income Other income Share based payments expense 24 Corporate and other administration costs 2 Transaction and integration costs 2 Loss on sale of subsidiary Exploration and evaluation costs expensed Finance costs 2 Profit before income tax expense Income tax expense 3 Profit after income tax expense attributable to Owners of Evolution Mining Limited Other comprehensive income Items that may be reclassified subsequently to profit or loss Changes in the fair value of available-for-sale financial assets 11(b) Changes in the fair value of cash flow hedges 11(b) Exchange differences on translation of foreign operations 11(b) Blank Other comprehensive income, net of tax Total comprehensive income Total comprehensive income for the period is attributable to: Owners of Evolution Mining Limited Earnings per share for profit attributable to Owners of Evolution Mining Limited: Basic earnings per share 4 Diluted earnings per share 4	1,540,433 1,479,876 (1,140,472) (1,151,344)
	399,961 328,532 3,332 1,519 651 776 (8,491) (6,413) (27,193) (28,728) 866 (6,987) - (3,576) (5,414) (12,645) (24,778) (35,194)
	338,934 237,284 (75,546) (19,677)
	263,388 217,607
	(1,925) 1,699 - 127 46 (47)
	(1,879) 1,779
	261,509 219,386
	261,509 219,386
	261,509 219,386
	Cents Cents 15.57 13.28 15.51 13.23

The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.

Consolidated Balance Sheet

Notes 30 June 2018 $'000 30 June 2017 $'000	Notes 30 June 2018 $'000 30 June 2017 $'000
ASSETS Current assets Cash and cash equivalents 9 Trade and other receivables 12 Inventories 14 Total current assets Non-current assets Inventories 14 Available-for-sale financial assets Property, plant and equipment 7 Mine development and exploration 8 Deferred tax assets 17 Other non-current assets 15 Total non-current assets Total assets LIABILITIES Current liabilities Trade and other payables 13 Interest bearing liabilities 10 Current tax liabilities Provisions 16 Other current liabilities Total current liabilities Non-current liabilities Interest bearing liabilities 10 Provisions 16 Total non-current liabilities Total liabilities Net assets EQUITY Issued capital 11(a) Reserves 11(b) Retained earnings/(Accumulated losses) 11(c) Capital and reserves attributable to owners of Evolution Mining Limited Total equity	323,226 37,385 71,296 63,119 264,221 276,869
	658,743 377,373 38,459 827 5,536 4,962 571,775 741,189 1,743,752 1,801,479 419 16,448 37,632 3,191
	2,397,573 2,568,096
	3,056,316 2,945,469
	152,367 156,627 93,496 53,401 47,312 36,214 32,085 30,173 63 3,206
	325,323 279,621 292,470 382,723 150,129 154,873
	442,599 537,596
	767,922 817,217
	2,288,394 2,128,252
	2,183,727 2,183,727 45,407 38,795 59,260 (94,270)
	2,288,394 2,128,252
	2,288,394 2,128,252

The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes.

Consolidated Statement of Changes in Equity

Notes Issued capital $'000 Share- based payments $'000 Fair value revaluation reserve $'000 Cash flow hedges $'000 Foreign currency translation $'000 Retained earnings $'000 Total equity $'000	Notes Issued capital $'000 Share- based payments $'000 Fair value revaluation reserve $'000 Cash flow hedges $'000 Foreign currency translation $'000 Retained earnings $'000 Total equity $'000
Balance at 1 July 2016 Profit after income tax expense Changes in fair value of available-for-sale financial assets Changes in fair value of cash flow hedge Exchange differences on translation of foreign operations Total comprehensive income Transactions with owners in their capacity as owners: Contributions of equity 11(a) Dividends provided for or paid 5 Recognition of share-based payments 24 Balance at 30 June 2017 Balance at 1 July 2017 Profit after income tax expense Fair value loss on avaible-for-sale financial assets, net of tax Exchange differences on translation of foreign operations Total comprehensive expense Transactions with owners in their capacity as owners: Dividends provided for or paid Recognition of share-based payments Balance at 30 June 2018	1,770,987 29,496 (110) (127) 104 (248,917) 1,551,433
	- - - - - 217,607 217,607 - - 1,699 - - - 1,699 - - - 127 - - 127 - - - - (47) - (47)
	- - 1,699 127 (47) 217,607 219,386
	412,740 - - - - - 412,740 - - - - - (62,960) (62,960) - 7,653 - - - - 7,653
	412,740 7,653 - - - (62,960) 357,433
	2,183,727 37,149 1,589 - 57 (94,270) 2,128,252
	2,183,727 37,149 1,589 - 57 (94,270) 2,128,252
	- - - - - 263,388 263,388 - - (1,925) - - - (1,925) - - - - 46 - 46
	- - (1,925) - 46 263,388 261,509
	- - - - - (109,858) (109,858) - 8,491 - - - - 8,491
	- 8,491 - - - (109,858) (101,367)
	2,183,727 45,640 (336) - 103 59,260 2,288,394

The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

Consolidated Statement of Cash Flows

Notes 30 June 2018 $'000 30 June 2017 $'000	Notes 30 June 2018 $'000 30 June 2017 $'000
Cash flows from operating activities Receipts from sales Payments to suppliers and employees Other income Interest received Interest paid Income taxes paid Net cash inflow from operating activities 6(a) Cash flows from investing activities Payments for property, plant and equipment Payments for mine development and exploration Proceeds from sale of property, plant and equipment Proceeds from sale of subsidiary Cash disposed on sale of subsidiary Payments for transaction and integration costs Transfer from term deposits Transaction costs related to business disposal Payments for Available-for-sale financial assets Payment for economic interest in Ernest Henry Net cash outflow from investing activities Cash flows from financing activities Proceeds from interest bearing liabilities - Senior Secured Syndicated Revolving and Term Facility Repayment of interest bearing liabilities - Senior Secured Syndicated Revolving and Term Facility Repayment of short term borrowings Proceeds from short term borrowings Payment of finance lease liabilities Dividends paid Proceeds from issues of shares Payment of transaction costs for issuing shares Net cash inflow from financing activities Net increase/ in cash and cash equivalents Cash and cash equivalents at the beginning of the period Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at end of period 9	1,554,951 1,441,275 (775,032) (768,279) 651 776 2,510 1,519 (20,495) (24,496) (48,419) -
	714,166 650,795
	(116,053) (91,041) (191,875) (181,267) 595 1,820 40,000 40,688 (13) - (438) (3,045) - (3) - (3,942) (2,500) - - (884,004)
	(270,284) (1,120,794)
	- 475,000 (40,000) (325,000) (84,330) (163,232) 77,460 161,630 (1,344) (8,316) (109,873) (52,419) - 408,808 - (6,315)
	(158,087) 490,156
	285,795 20,157 37,385 17,295 46 (67)
	323,226 37,385

The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.

Notes to the Consolidated Financial Statements

Contents of the Notes to the Consolidated Financial Statements

		Page
	Business Performance	45
1	Performance by Mine	45
2	Revenue and Expenses	46
3	Income tax expense	48
4	Earnings per share	48
5	Dividends	49
6	Other cash flow information	50
	Resource Assets and Liabilities	52
7	Property, plant and equipment	52
8	Mine development and exploration	54
	Capital Structure, Financing and Working Capital	58
9	Cash and cash equivalents	58
10	Interest bearing liabilities	58
11	Equity and reserves	59
12	Trade and other receivables	61
13	Trade and other payables	62
14	Inventories	62
15	Other non-current assets	63
16	Provisions	63
17	Deferred tax balances	65
	Risk and unrecognised items	67
18	Financial risk management	67
19	Contingent liabilities and contingent assets	70
20	Commitments	70
21	Events occurring after the reporting period	72
	Other information	73
22	Ernest Henry Operation	73
23	Related party transactions	74
24	Share-based payments	75
25	Remuneration of auditors	77
26	Deed of cross guarantee	78
27	Interests in other entities	79
28	Parent entity financial information	80
29	Summary of significant accounting policies	81
30	New accounting standards	82

Notes to the Consolidated Financial Statements

Business Performance

This section highlights the key indicators on how the Group performed during the year.

1 Performance by Mine

(a) Description of segments

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Executive Chairman and the Senior Leadership Team (the chief business decision makers) in assessing performance and in determining the allocation of resources.

The Group’s operational mine sites, Exploration and Corporate are each treated as individual operating segments. Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment.

Corporate includes share-based payment expenses and other corporate expenditures supporting the business during the period.

Segment performance is evaluated based on earnings before interest, tax, depreciation and amortisation (EBITDA).

The Group’s operations are all conducted in the mining industry in Australia.

(b) Segment information

The segment information for the reportable segments for the year ended 30 June 2018 is as follows:

	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000
30 June 2018 SPACE Revenue EBITDA Sustaining Capital Major Capital Total Capital	422,858 234,225 39,697 84,923 124,620	191,062 67,331 9,935 36,611 46,546	214,844 136,503 9,866 21,009 30,875	179,387 93,006 8,574 10,924 19,498	37,171 2,629 1,599 3,072 4,671	147,708 70,210 19,601 14,451 34,052	347,403 230,976 11,618 - 11,618	- - - - -	- - 1,540,433 (5,414) (34,383) 795,083 - 1,619 102,509 - - 170,990 - 1,619 273,499

The segment information for the reportable segments for the year ended 30 June 2017 is as follows:

	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000	Cowal $'000 Mungari $'000 Mt Carlton $'000 Mt Rawdon $'000 Edna May $'000 Cracow $'000 Ernest Henry $'000 Pajingo $'000 Explo- ration $'000 Corp- orate $'000 Total $'000
30 June 2017 Space Revenue EBITDA Sustaining Capital Major Capital Total Capital	440,691 258,434 43,849 27,080 70,929	231,767 90,029 14,566 22,161 36,727	197,093 126,051 15,304 13,887 29,191	166,471 91,578 14,242 19,071 33,313	116,845 20,588 2,241 28,519 30,760	146,149 71,610 17,462 14,168 31,630	163,342 99,234 6,066 - 6,066	17,518 2,614 2,820 3,560 6,380	- - 1,479,876 (12,645) (33,638) 713,855 - 1,035 117,585 - - 128,446 - 1,035 246,031

Notes to the Consolidated Financial Statements

1 Performance by Mine (continued)

(c) Segment reconciliation

	30 June 2018 $'000 30 June 2017 $'000
Reconciliation of profit before income tax expense SPACE EBITDA Depreciation and amortisation Interest income Acquisition and integration costs Fair value amortisation expense Fair value unwinding expense Finance costs Loss on sale of subsidiary Profit before income tax expense	795,083 713,855 (405,230) (388,824) 3,332 1,519 866 (6,987) (33,481) (45,035) 3,142 1,526 (24,778) (35,194) - (3,576)
	338,934 237,284

Recognition and measurement

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

The Board of Evolution Mining Limited has appointed a strategic steering committee which assesses the financial performance and position of the Group, and makes strategic decisions. The steering committee, which has been identified as being the chief business decision maker, consists of the Executive Chairman and the Senior Leadership Team (KMP).

2 Revenue and Expenses

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
*Sales revenue* Gold sales Silver sales Copper sales	1,312,640 21,049 206,744	1,341,311 25,164 113,401
	1,540,433	1,479,876

	30 June 2018 $'000 30 June 2017 $'000
*Cost of sales* Mine operating costs Royalty and other selling costs Depreciation and amortisation expense Fair value amortisation Fair value gain	639,609 657,258 65,944 62,480 404,580 388,097 33,481 45,035 (3,142) (1,526)
	1,140,472 1,151,344

Notes to the Consolidated Financial Statements

2 Revenue and Expenses (continued)

	30 June 2018 $'000 30 June 2017 $'000
*Corporate and other administration costs* Depreciation and amortisation expense Corporate overheads *Transaction and integration costs* Contractor, consultants and advisory expense Corporate and administration expense Stamp duty on business combinations *Finance costs* Finance lease interest expense Amortisation of debt establishment costs Unwinding of discount on provisions Interest expense *Depreciation and amortisation* Cost of sales (excluding Ernest Henry) Cost of sales (Ernest Henry) Corporate and other administration costs	650 727 26,543 28,001
	27,193 28,728
	724 2,998 978 944 (2,568) 3,045
	(866) 6,987
	19 338 740 7,444 3,544 3,254 20,475 24,158
	24,778 35,194
	278,911 323,195 125,669 64,902 650 727
	405,230 388,824

Recognition and measurement

Revenue from the sale of goods is recognised when there has been a transfer of risks and rewards to the customer and no further processing is required by the Group, the quality and quantity of the goods has been determined with reasonable accuracy, the price is fixed or determinable, and collectability is probable. The point at which risk and title passes for concentrate sales is generally upon receipt of the bill of lading when the commodity is delivered for shipment. Revenue is measured at the fair value of the consideration received or receivable.

The terms of metal in concentrate sales contracts with third parties contain provisional pricing arrangements whereby the selling price for metal in concentrate is based on prevailing spot prices on a specified future date after shipment to the customer (quotation period). Adjustments to the sales price occur based on movements in quoted marked prices up to the date of final settlement. The period between provisional invoicing and final settlement is typically between one and three months. Revenue on provisionally priced sales is recognised based on the estimated fair value of the total consideration receivable.

Notes to the Consolidated Financial Statements

3 Income tax expense

Judgement is required to determine whether deferred tax assets are recognised in the Balance Sheet. Management must assess the likelihood that the Group will generate sufficient taxable earnings in future periods in order to recognise and utilise those deferred tax assets. Estimates of future taxable income are based on forecast cash flows from operations and existing tax laws. These assessments require the use of estimates such as commodity prices and operating performance over the life of the assets. To the extent that cash flows and taxable income differ significantly from estimates, the Group’s ability to realise the deferred tax assets reporting could be impacted.

(a) Income tax expense

	30 June 2018 $'000 30 June 2017 $'000
Current tax on profits for the period Deferred tax Previously unrecognised tax loss now recognised Adjustments for current tax of prior periods	85,490 36,214 (4,433) 3,863 - (20,400) (5,511) -
	75,546 19,677

(b) Numerical reconciliation of income tax expense to prima facie tax payable

	30 June 2018 $'000 30 June 2017 $'000
Profit before income tax Tax at the Australian tax rate of 30% space Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Costs of business acquisitions Deferred tax expense on sale of subsidiary Adjustments for current tax of prior periods Share-based payments Loss on sale of subsidiary Other Temporary differences now recognised to reduce deferred tax expense Tax loss recognised to reduce deferred tax expense Tax losses used to reduce current tax expense Income tax expense	338,933 237,284 101,680 71,185 - 982 4,165 - (5,511) - 2,547 1,924 - 1,073 (689) 2,257 (12,993) - (4,544) (20,400) (9,109) (37,344)
	75,546 19,677

30 June
2018
$'000
30 June
2017
$'000

Profit before income tax
Tax at the Australian tax rate of 30%
space
Tax effect of amounts which are not deductible (taxable)
in calculating taxable income:
Costs of business acquisitions
Deferred tax expense on sale of subsidiary
Adjustments for current tax of prior periods
Share-based payments
Loss on sale of subsidiary
Other
Temporary differences now recognised to reduce deferred tax expense
Tax loss recognised to reduce deferred tax expense
Tax losses used to reduce current tax expense
Income tax expense

338,933
237,284
101,680
71,185
-
982
4,165
-
(5,511)
-
2,547
1,924
-
1,073
(689)
2,257
(12,993)
-
(4,544)
(20,400)
(9,109)
(37,344)

75,546
19,677

4 Earnings per share

(a) Earnings per share

	30 June 2018 Cents 30 June 2017 Cents
Basic earnings per share (cents) Diluted earnings per share (cents)	15.57 13.28 15.51 13.23

Notes to the Consolidated Financial Statements

4 Earnings per share (continued)

(b) Earnings used in calculating earnings per share

	30 June 2018 $'000 30 June 2017 $'000
Earnings per share used in the calculation of basic and diluted earnings per share: Profit after income tax attributable to the owners of the parent (c) Weighted average number of shares used as the denominator	263,388 217,607

	2018 Number 2017 Number
Weighted average number of ordinary shares used in calculating the basic earnings per share Effect of dilutive securities (i) Adjusted weighted average number of ordinary shares used in calculating the diluted earnings per share (i) Performance rights and share rights have been included in the determination of diluted	1,691,215,407 1,638,875,242 6,419,798 5,584,134
	1,697,635,205 1,644,459,376
	earnings per share

5 Dividends

(a) Ordinary shares

	30 June 2018 $'000 30 June 2017 $'000
Interim dividend - 2018 Interim dividend for the year ended 30 June 2018 of 3.5 cents per share fully franked (30 June 2017: 2 cent per share unfranked) per fully paid share paid on 30 March 2018 Space Final dividend - 2017 Final dividend for the year ended 30 June 2017 of 3 cents per share fully franked (30 June 2016: 2 cent per share unfranked) per fully paid share paid on 26 September 2017	59,180 33,595 50,678 29,365
	109,858 62,960

(b) Dividends not recognised at the end of the reporting period

In June 2017, the Directors approved a change to the dividend policy of whenever possible paying a dividend equivalent to 50% of the Group's earnings. The final dividend for 2018 has been calculated accordingly.

Notes to the Consolidated Financial Statements

5 Dividends (continued)

(b) Dividends not recognised at the end of the reporting period (continued)

	30 June 2018 $'000 30 June 2017 $'000
In addition to the above dividends, since period end the Directors have recommended the payment of a fully franked final dividend of 4.0 cents per fully paid ordinary share (30 June 2017: 3 cents fully franked). The aggregate amount of the proposed dividend expected to be paid on 28 September 2018 out of retained earnings at 30 June 2018, but not recognised as a liability at period end, is	67,704 50,484

(c) Franked dividends

The final dividend recommended after 30 June 2018 will be fully franked out of franking credits expected to arise from the payment of income tax during the year ending 30 June 2019. The franking account balance at the end of the financial year is $1.3 million (30 June 2017: nil)

6 Other cash flow information

(a) Reconciliation of profit after income tax to net cash inflow from operating activities

30 June
2018
$'000
30 June
2017
$'000

Profit after income tax
Transaction and integration costs
Fair value amortisation and expense
Depreciation and amortisation
Unwind of discount on provisions
Amortisation of debt establishment costs
Share-based payments expense
Exploration and evaluation costs expensed
Income tax expense
Loss on sale of subsidiary
Timing difference on settlement of Ernest Henry sales/ costs
Change in operating assets and liabilities:
Increase in operating receivables
Increase in inventories
Increase in operating payables
Increase in current and deferred tax balances
Increase in borrowing costs
Increase in other provisions
Net cash inflow from operating activities

263,388
217,607
(866)
6,987
30,339
43,509
404,650
388,824
3,544
3,254
740
7,444
8,491
6,413
5,414
12,645
75,546
-
-
3,576
(76)
16,887
(9,509)
(36,237)
(26,728)
(41,586)
8,179
4,957
(48,419)
19,677
(2,684)
(7,857)
2,157
4,695

714,166
650,795

Notes to the Consolidated Financial Statements

6 Other cash flow information (continued)

(b) Net debt reconciliation

This section sets out an analysis of net debt and the movements in net debt for each of the periods presented.

	30 June 2018 $'000 30 June 2017 $'000
Net debt Cash and cash equivalents Bank loans Net bank debt Available-for-sale financial assets Finance lease liabilities Net debt	323,226 37,385 (395,000) (435,000)
	(71,774) (397,615) 5,536 4,961 - (1,344)
	(66,238) (393,998)

	Cash and cash equivalent $'000 Available- for-sale (i) $'000 Finance leases due within 1 year $'000 Bank loans due within 1 year $'000 Bank loans due after 1 year $'000 Total $'000
Year ended 30 June 2017 space Net debt at the beginning of the year Cash flows Foreign exchange adjustments Other non-cash movements Net debt as at end of the year Year ended 30 June 2018 space Net debt at the beginning of the year Cash flows Foreign exchange adjustments Other non-cash movements Net debt at the end of the year	17,295 3,263 (8,316) - (285,000) (272,758) 20,157 - 6,972 (50,000) (100,000) (122,871) (67) - - - - (67) - 1,698 - - - 1,698
	37,385 4,961 (1,344) (50,000) (385,000) (393,998)
	37,385 4,961 (1,344) (50,000) (385,000) (393,998) 285,794 - 1,344 (45,000) 85,000 327,138 47 - - - - 47 - 575 - - - 575
	323,226 5,536 - (95,000) (300,000) (66,238)

(i) Available-for-sale comprise current investments that are traded in an active market, being the Group’s financial assets held at fair value through profit or loss.

Notes to the Consolidated Financial Statements

Resource Assets and Liabilities

This section provides information that is relevant to understanding the composition and management of the Group's assets and liabilities.

7 Property, plant and equipment

	Freehold land $'000 Plant and equipment $'000 Total $'000
At 1 July 2017 Cost Accumulated depreciation Net carrying amount Year ended 30 June 2018 Carrying amount at beginning of year Additions Reclassification Disposals Depreciation Depreciation relating to fair value uplift on business combinations Disposal of subsidiary Carrying amount at the end of the year At 30 June 2018 Cost Accumulated depreciation Net carrying amount Included in above Assets in the course of construction	16,841 1,640,294 1,657,135 - (915,946) (915,946)
	16,841 724,348 741,189
	16,841 724,348 741,189 - 116,053 116,053 - (90,578) (90,578) - (595) (595) - (117,563) (117,563) - (4,608) (4,608) (2,580) (69,543) (72,123)
	14,261 557,514 571,775
	14,261 1,590,847 1,605,108 - (1,033,333) (1,033,333)
	14,261 557,514 571,775

	- 103,445 103,445

Notes to the Consolidated Financial Statements

7 Property, plant and equipment (continued)

	Freehold land $'000 Plant and equipment $'000 Total $'000
At 1 July 2016 Cost Accumulated depreciation Net carrying amount Year ended 30 June 2017 Carrying amount at beginning of year Additions Reclassification Disposals Depreciation Depreciation relating to fair value uplift on business combinations Carrying amount at the end of the year At 30 June 2017 Cost Accumulated depreciation Net carrying amount Included in above Carrying amount of lease assets Assets in the course of construction	10,526 1,565,270 1,575,796 - (786,026) (786,026)
	10,526 779,244 789,770
	10,526 779,244 789,770 4,258 86,783 91,041 2,057 (2,322) (265) - (1,820) (1,820) - (132,076) (132,076) - (5,461) (5,461)
	16,841 724,348 741,189
	16,841 1,640,294 1,657,135 - (915,946) (915,946)
	16,841 724,348 741,189
	- 2,952 2,952 - 67,352 67,352
	- 70,304 70,304

Recognition and measurement

Cost

Plant and equipment is carried at cost less accumulated depreciation and impairment. Costs equals the fair value of the item at acquisition date and includes expenditure that is directly attributable to the acquisition of the items. Freehold land is carried at cost.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the Statement of Profit or Loss during the reporting period in which they are incurred.

An item of property, plant and equipment is derecognised when it is sold or otherwise disposed of, or when its use is expected to bring no future economic benefits. Any gain or loss from derecognising the asset is included in the statement of profit or loss in the period the item is derecognised.

Depreciation

Depreciation of plant and equipment is calculated using either the straight line or units of production method to allocate their cost, net of their residual values, over their estimated useful lives. The rates vary between 10% and 33% per annum. Freehold land is not depreciated.

Accounting estimates and judgements

Estimation of remaining useful lives, residual values and depreciation methods involve significant judgement and are reviewed annually for all major items of plant and equipment. Any changes are accounted for prospectively from the date of reassessment to the end of the revised useful life.

Notes to the Consolidated Financial Statements

8 Mine development and exploration

	Producing mines $'000 Exploration and evaluation $'000 Total $'000
At 1 July 2017 Cost Accumulated amortisation Net carrying amount Year ended 30 June 2018 Carrying amount at beginning of year Additions Amortisation Amortisation recognised in inventory Amortisation relating to fair value uplift on business combinations Asset write-off Reclassifications Disposal of subsidiary Reclassification to long term inventory Carrying amount at the end of the year At 30 June 2018 Cost Accumulated amortisation Net carrying amount	2,959,137 128,128 3,087,265 (1,285,786) - (1,285,786)
	1,673,351 128,128 1,801,479
	1,673,351 128,128 1,801,479 176,772 31,014 207,786 (287,668) - (287,668) (580) - (580) (28,873) - (28,873) - (5,410) (5,410) 91,837 (1,259) 90,578 (20,108) (172) (20,280) (13,280) - (13,280)
	1,591,451 152,301 1,743,752
	3,085,507 152,301 3,237,808 (1,494,056) - (1,494,056)
	1,591,451 152,301 1,743,752

Notes to the Consolidated Financial Statements

8 Mine development and exploration (continued)

	Producing mines $'000 Exploration and evaluation $'000 Total $'000
At 1 July 2016 Cost Accumulated amortisation Net carrying amount Year ended 30 June 2017 Carrying amount at beginning of year Additions Amortisation Acquisition of economic interest in Ernest Henry Operation (i) Amortisation recognised in inventory Amortisation relating to fair value uplift on business combinations Exchange differences Asset write-off Reclassifications Carrying amount at the end of the year At 30 June 2017 Cost Accumulated amortisation Net carrying amount	1,962,882 110,338 2,073,220 (1,015,047) - (1,015,047)
	947,835 110,338 1,058,173
	947,835 110,338 1,058,173 151,500 30,473 181,973 (256,748) - (256,748) 884,004 - 884,004 (13,990) - (13,990) (39,574) - (39,574) - 21 21 - (12,645) (12,645) 324 (59) 265
	1,673,351 128,128 1,801,479
	2,959,137 128,128 3,087,265 (1,285,786) - (1,285,786)
	1,673,351 128,128 1,801,479

(i) Refer to note 22 for information on the Ernest Henry transaction and financial results for the year ended 30 June 2018.

Recognition and measurement

Mines under construction

This expenditure includes net direct costs of construction, borrowing costs capitalised during construction and an appropriate allocation of attributable overheads. Expenditure is net of proceeds from the sale of ore extracted during the construction phase to the extent that this ore extracted is considered material to the development of the mine.

After production commences, all aggregated costs of construction are transferred to producing mines or plant and equipment as appropriate.

Producing mines - deferred stripping

Stripping (waste removal) costs are incurred both during the development phase and production phase of operations. Stripping costs incurred during the development phase are capitalised as mines under construction. Stripping costs incurred during the production phase are generally considered to create two benefits:

the production of ore inventory in the period - accounted for as a part of the cost of producing those ore inventories; or
improved access to the ore to be mined in the future - recognised under producing mines if the following criteria are met:
Future economic benefits (being improved access to the ore body) associated with the stripping activity are probable;
The component of the ore body for which access has been improved can be accurately identified; and
The costs associated with the stripping activity associated with that component can be reliably measured.

The amount of stripping costs deferred is based on the life of component ratio which is obtained by dividing the amount of waste tonnes mined by the quantity of gold ounces contained in the ore for each component of the mine. Stripping costs incurred in the period are deferred to the extent that the actual current period waste to contained gold ounce ratio exceeds the life of component expected 'life of component' ratio.

Notes to the Consolidated Financial Statements

8 Mine development and exploration (continued)

Recognition and measurement

Producing mines - deferred stripping

A component is defined as a specific volume of the ore body that is made more accessible by the stripping activity and is determined based on mine plans. An identified component of the ore body is typically a subset of the total ore body of the mine. Each mine may have several components, which are identified based on the mine plan.

The deferred stripping asset is initially measured at cost, which is the accumulation of costs directly incurred to perform the stripping activity that improves access to the ore within an identified component, plus an allocation of directly attributable overhead costs.

The deferred stripping asset is depreciated over the expected useful life of the identified component of the ore body that is made more accessible by the activity, on a units of production basis. Economically recoverable reserves are used to determine the expected useful life of the identified component of the ore body.

Exploration and evaluation

Exploration and evaluation expenditure related to areas of interest is capitalised and carried forward to the extent that rights to tenure of the area of interest are current and either:

Costs are expected to be recouped through the successful development and exploitation of the area of interest or alternatively by sale; or
Where activities in the area of interest have not yet reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing.

Such expenditure consists of an accumulation of acquisition costs and direct exploration and evaluation costs incurred, together with an appropriate portion of directly related overhead expenditure.

The carrying value of capitalised exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying value may exceed its recoverable amount. Any amounts in excess of the recoverable amount are derecognised in the financial year it is determined.

Depreciation and amortisation

The Group uses the units of production basis when amortising mine development assets which results in an amortisation charge proportional to the depletion of the anticipated remaining life of mine production. Each item's economic life has due regard to both its physical life limitations and to present assessments of economically recoverable reserves of the mine property at which it is located.

Impairment of non-financial assets

(i) Testing for impairment

At each reporting date, the Group tests its tangible and other intangible assets for impairment where there in an indication that:

the asset may be impaired; or
previously recognised impairment (on assets other than goodwill) may have changed.

Where the asset does not generate cash inflows independent from other assets and its value in use cannot be estimated to be close to its fair value, the asset is tested for impairment as part of the cash generating unit (CGU) to which it belongs. The Group considers each of its mine sites to be a separate CGU.

If the carrying amount of an asset or CGU exceeds its recoverable amount, the carrying amount is reduced to the recoverable amount and an impairment loss recognised in the Statement of Profit or Loss. The recoverable amount of an asset or CGU is determined as the higher of its fair value less costs of disposal or value in use.

(ii) Impairment calculations

In assessing value in use, the estimated future cash flows are discounted to their present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. In determining fair value less costs of disposal, a discounted cash flow model is used based on a methodology consistent with that applied by the Group in determining the value of potential acquisition targets, maximising the use of market observed inputs. These calculations, classified as Level 3 on the fair value hierarchy, are compared to valuation multiples, or other fair value indicators where available, to ensure reasonableness.

Notes to the Consolidated Financial Statements

8 Mine development and exploration (continued)

Accounting estimates and judgements

Deferred stripping

The life of component ratio is a function of the mine design and therefore changes to that design will generally result in changes to the ratio. Changes in other technical or economic parameters that impact reserves will also have an impact on the life of component ratio even if they do not affect the mine design. Changes to production stripping resulting from a change in life of component ratios are accounted for prospectively.

Exploration and evaluation

Judgement is required to determine whether future economic benefits are likely, from either exploitation or sale, or whether activities have not reached a stage that permits a reasonable assessment of the existence of reserves. In addition to these judgements, the Group has to make certain estimates and assumptions such as the determination of a JORC resource which is itself an estimation process that involves varying degrees of uncertainty depending on how the resources are classified (i.e. measured, indicated or inferred). These estimates directly impact when the Group capitalises exploration and evaluation expenditure. The capitalisation policy requires management to make certain estimates and assumptions as to future events and circumstances, in particular, the assessment of whether economic quantities of reserves will be found. Any such estimates and assumptions may change as new information becomes available.

The recoverable amount of capitalised expenditure relating to undeveloped mining projects (projects for which the decision to mine has not yet been approved at the required authorisation level within the Group) can be particularly sensitive to variations in key estimates and assumptions. If a variation in key estimates or assumptions has a negative impact on recoverable amount it could result in a requirement for impairment.

Units of production method of amortisation

The Group uses the units of production basis when amortising mine development assets which results in an amortisation charge proportional to the depletion of the anticipated remaining life of mine production. Each item's economic life, which is assessed annually, has due regard to both its physical life limitations and to present assessments of economically recoverable reserves of the mine property at which it is located. These calculations require the use of estimates and assumptions.

Ore reserves and resources

The Group estimates its ore reserves and mineral resources annually at 31 December each year and reports in the following April, based on information compiled by Competent Persons as defined in accordance with the Australasian code for reporting Exploration Results, Mineral Resources and Ore Resources (JORC code 2012). The estimated quantities of economically recoverable reserves are based upon interpretations of geological models and require assumptions to be made regarding factors such as estimates of short and long-term exchange rates, estimates of short and long-term commodity prices, future capital requirements and future operating performance. Changes in reported reserves estimates can impact the carrying amount of mine development (including exploration and evaluation assets), the provision for rehabilitation obligations, the recognition of deferred tax assets, as well as the amount of amortisation charged to the statement of profit or loss.

Impairment

Significant judgements, estimates and assumptions are required in determining value in use or fair value less costs of disposal. This is particularly so in the assessment of long life assets. It should be noted that the CGU recoverable amounts are subject to variability in key assumptions including, but not limited to, gold and copper prices, currency exchange rates, discount rates, production profiles and operating and capital costs. A change in one or more of the assumptions used to determine value in use or fair value less costs of disposal could result in a change in a CGU's recoverable amount.

The Group has considered whether past impairment losses should be reversed given the expectation of continued improved earnings in relation to those CGUs. While there are some indicators supporting a reversal of impairment, other indicators (such as metals prices, continued price volatility and variability in values of asset transactions) do not clearly support a reversal. Accordingly a reversal of past impairment losses has not been recognised.

Notes to the Consolidated Financial Statements

Capital Structure and Financing

This section provides information on the Group's capital and financial management activities.

9 Cash and cash equivalents

	30 June 2018 $'000 30 June 2017 $'000
Current assets Bank balances Cash at bank	- - 323,226 37,385
	323,226 37,385

Recognition and measurement

Cash and short-term deposits in the balance sheet comprise cash and bank and on hand and short term deposits with an original maturity of three months or less and are classified as financial assets held at amortised cost.

Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods of between one day and three months depending on the immediate cash requirements of the Group and earn interest at the respective short-term deposit rates.

10 Interest bearing liabilities

	30 June 2018 $'000 30 June 2017 $'000
Current liabilities Bank loans Less: Borrowing costs Finance lease liabilities Other borrowings Non-current liabilities Bank loans Less: Borrowing costs	95,000 50,000 (1,504) (4,813) - 1,344 - 6,870
	93,496 53,401
	300,000 385,000 (7,530) (2,277)
	292,470 382,723

Notes to the Consolidated Financial Statements

10 Interest bearing liabilities (continued)

The repayment periods and the outstanding balances as at 30 June 2018 on each Facility are set out below:

	Term date	Outstanding balance
Senior Secured Revolving Loan - Facility A ($350.0 million)	31 July 2021	$ nil
Performance Bond Facility - Facility C	31 July 2021	$132 million
Senior Secured Term Loan - Facility D	15 October 2021	$395 million
(a) Secured liabilities and assets pledged as security

The New Facility is secured in the form of a General Security Agreement and Share Security Agreement over the Groups operating assets. The carrying amounts of assets pledged as general security for total borrowings is $1.952 billion. The share capital pledged as share security for total borrowings is $1.872 billion.

Lease liabilities are effectively secured as the rights to the leased assets recognised in the financial statements revert to the lessor in the event of default.

Recognition and measurement

Interest bearing liabilities are initially recognised at fair value less directly attributable transaction costs incurred and subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in the statement of profit or loss when the liabilities are derecognised.

11 Equity and reserves

(a) Contributed equity

Movements in ordinary share capital

Ordinary shares are fully-paid and have no par value. They carry one vote per share and the rights to dividends. They bear no special terms or conditions affecting income or capital entitlements of the shareholders and are classified as equity.

	Number of shares $'000	Number of shares $'000
Balance at 1 July 2016 Shares issued on vesting of performance rights Shares issued under DRP for final dividend Shares issued under DRP for interim dividend Shares issued under Institutional Component of Entitlement Offer Shares issued under Retail Component of Entitlement Offer Shares issued under Employee Share Scheme (i) Shares issued on exercise of unlisted share options Less: share issue costs Balance at 30 June 2017 Shares issued on vesting of performance rights Shares issued under Employee Share Scheme (i) Shares issued under NED Equity Plan Balance at 30 June 2018	1,468,262,821 7,961,146 1,927,526 3,066,229 151,914,603 44,976,448 511,192 4,178,661 -	1,770,987 - 4,055 6,192 311,425 90,134 - 7,249 (6,315)
	1,682,798,626 9,214,401 501,234 97,788	2,183,727 - - -
	1,692,612,049	2,183,727

(i) Information relating to the employee share scheme, including details of shares issued under the scheme, is set out in note 24.

Notes to the Consolidated Financial Statements

11 Equity and reserves (continued)

(a) Contributed equity (continued)

Recognition and measurement

Ordinary share capital is classified as equity and is recognised at the fair value of the consideration received by the Group. Incremental costs directly attributable to the issue of new shares, options or performance rights are shown in equity as a deduction, net of tax, from the proceeds.

(b) Other reserves

Notes 30 June 2018 $'000 30 June 2017 $'000	Notes 30 June 2018 $'000 30 June 2017 $'000
Fair value revaluation reserve Share-based payments Other reserves Movements: Fair value revaluation reserve Balance at the beginning of the year Change in fair value of available-for-sale financial assets Balance at the end of the year Cash flow hedges Balance at the beginning of the year Change in the fair value of cash flow hedges Balance at the end of the year Share-based payments Balance at the beginning of the year Share based payments expense 24 Balance at the end of the year Foreign currency translation Balance at the beginning of the year Currency translation differences arising during the year Balance at the end of the year	(336) 1,589 45,640 37,149 103 57
	45,407 38,795
	1,589 (110) (1,925) 1,699
	(336) 1,589
	- (127) - 127
	- -
	37,149 29,496 8,491 7,653
	45,640 37,149
	57 104 46 (47)
	103 57

(i) Nature and purpose of other reserves

Fair value revaluation reserve

The fair value revaluation reserve records fair value changes on financial assets designated at fair value through other comprehensive income.

Cash flow hedges

The cash flow hedging reserve records the portion of gains or losses on derivatives that are designated and qualify as cash flow hedges and are recognised in other comprehensive income.

Notes to the Consolidated Financial Statements

11 Equity and reserves (continued)

(b) Other reserves (continued)

(i) Nature and purpose of other reserves (continued)

Share-based payments

The share-based payments reserve is used to recognise the value of equity-settled share-based payments provided to employees, including Non-Executive Directors, Executive Directors and key management personnel as part of their remuneration. Refer to note 24 for further information.

Foreign currency translation

The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries.

(c) Retained earnings

Movements in retained earnings were as follows:

Notes 30 June 2018 $'000 30 June 2017 $'000	Notes 30 June 2018 $'000 30 June 2017 $'000
Balance at the beginning of the year Net profit for the period Dividends paid 5 Balance at the end of the year	(94,270) (248,917) 263,388 217,607 (109,858) (62,960)
	59,260 (94,270)

12 Trade and other receivables

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Current assets Trade receivables (i) GST refundable Prepayments Other receivables	60,394 3,501 5,386 2,015	53,534 4,349 3,296 1,940
	71,296	63,119

(i) Trade receivables includes accrued income of $46.897 million (30 June 2017: $40.263 million) relating to silver and copper sales from April to June 2018 production for Ernest Henry. These amounts are to be settled in July to September 2018. Refer to note 22 for further information on the transaction and the financial results for the year ended 30 June 2018.

Recognition and measurement

Trade receivables

Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. Trade receivables are generally due for settlement within 30 days and therefore are all classified as current.

Other receivables

These amounts generally arise from transactions outside the usual operating activities of the Group. They do not contain impaired assets and are not past due.

Notes to the Consolidated Financial Statements

13 Trade and other payables

	30 June 2018 $'000 30 June 2017 $'000
Current liabilities Trade creditors and accruals (i) Other payables	123,889 132,073 28,478 24,554
	152,367 156,627

(i) Trade creditors and accruals include accrued costs of $29.157 million (30 June 2017: $29.522 million) relating to the Group's share of production costs for April to June 2018 for Ernest Henry. These amounts are to be settled in July to September 2018. Refer to note 22 for further information on the transaction and the financial results for the year ended 30 June 2018.

Recognition and measurement

Trade creditors and accruals

Trade creditors and accruals represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. The amounts are unsecured and are paid on normal commercial terms. The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their short-term nature.

14 Inventories

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Current Stores Ore Doré and concentrate Metal in circuit Metal in transit Total current inventories Non-current Stores Ore Total non-current inventories	43,334 166,820 6,055 21,867 26,145	46,946 175,302 8,088 21,323 25,210
	264,221	276,869
	- 38,459	827 -
	38,459	827

Recognition and measurement

Ore stockpiles, metal in circuit, gold doré, metal in transit, refined gold bullion and concentrate are physically measured or estimated and valued at the lower of cost and net realisable value. Cost represents the weighted average cost and includes direct costs and an appropriate portion of fixed and variable production overhead expenditure, including depreciation and amortisation, incurred in converting materials into finished goods.

Materials and supplies are valued at the lower of cost and net realisable value. Any provision for obsolescence is determined by reference to specific stock items identified. A regular and ongoing review is undertaken to establish the extent of surplus items and a provision is made for any potential loss on their disposal. If the stockpile is not expected to be processed within 12 months after reporting date, it is included in non-current assets.

Notes to the Consolidated Financial Statements

14 Inventories (continued)

Accounting estimates and judgements

Net realisable value

Net realisable value involves significant judgements and estimates in relation to the selling price in the ordinary course of business less estimates costs of completion and estimated costs necessary to make the sale.

The total expense relating to inventory write downs to net realisable value for the year ended 30 June 2018 was $6.128 million (30 June 2017: $9.117 million).

15 Other non-current assets

	30 June 2018 $'000 30 June 2017 $'000
Non-current assets -Other Contingent consideration attributable to the Pajingo Operation Contingent consideration attributable to the Edna May Operation Other Total other non-assets	3,100 3,100 34,441 - 91 91
	37,632 3,191

Contingent consideration amounts classified as a financial asset are remeasured to fair value with changes in fair value recognised in profit or loss. No fair value gains or losses have been recognised in profit or loss during the year.

16 Provisions

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Current Employee entitlements Non-current Employee entitlements Rehabilitation provision Other long term provision Total provisions	32,085	30,173
	32,085	30,173
	2,935 146,988 206	5,298 149,372 203
	150,129	154,873
	182,214	185,046

Total provisions

Notes to the Consolidated Financial Statements

16 Provisions (continued)

(i) Movements in provisions

Movements in each class of provision during the financial year are set out below:

	Employee benefits $'000 Rehabilitation $'000 Other $'000 Total $'000
30 June 2018 Space Carrying amount at the beginning of the year Charged to profit or loss - unwinding of discount - provision recognised Re-measurement of provision Disposal of subsidiary Carrying amount at the end of the year 30 June 2017 Space Carrying amount at the beginning of the year Charged to profit or loss - unwinding of discount - provision recognised Re-measurement of provision Carrying amount at the end of the year	35,471 149,372 203 185,046 - 3,544 - 3,544 3,099 (944) - 2,155 - 16,000 3 16,003 (3,550) (20,984) - (24,534)
	35,020 146,988 206 182,214
	30,982 145,916 200 177,098 - 3,204 - 3,204 4,489 (814) - 3,675 - 1,066 3 1,069
	35,471 149,372 203 185,046

Employee benefits

The provision for employee benefits represent wages and salaries, annual leave and long service leave entitlements.

Rehabilitation

The nature of site restoration costs include the dismantling and removal of mining plant, equipment and building structures, waste removal and restoration, reclamation and revegetation of affected areas of the site in accordance with the requirements of the mining permits.

Recognition and measurement

Employee benefits

Annual leave liabilities are measured at the amounts expected to be paid when the liabilities are settled.

Long service leave liabilities are measured at the present value of the estimated future cash outflows for the services provided by employees up to the reporting date.

Liabilities not expected to be settled within twelve months are discounted using market yields at the reporting date on high quality corporate bonds with terms to maturity that match, as closely as possible to the related liability.

Rehabilitation

Site restoration costs are recorded at the present value of the estimated future costs of the legal and constructive obligation to rehabilitate locations.

Notes to the Consolidated Financial Statements

16 Provisions (continued)

Recognition and measurement (continued)

Rehabilitation

When the liability is initially recorded, the present value of the estimated cost is capitalised as part of the carrying value of the related mining assets. Over time, the discounted liability is increased for the change in the present value based on a discount rate that reflects current market assessments. Additional disturbances or changes in rehabilitation costs will be recognised as additions or changes to the corresponding asset and rehabilitation liability when incurred.

The unwinding of the effect of discounting the provision is recorded as a finance cost in the statement of profit or loss. The carrying amount is capitalised as part of mine development and amortised on a units of production basis.

Accounting estimates and judgements

Employee benefits

Management judgement is required in determining the future probability of employee departures and period of service used in the calculation of long service leave.

Rehabilitation

Significant estimates and assumptions are required in determining the provision for mine rehabilitation as there are many transactions and other factors that will affect the ultimate liability payable to rehabilitate the mine sites. Factors that will affect this liability include changes in technology, changes in regulations, price increases, changes in timing of cash flows which are based on life of mine plan and changes in discount rates. When these factors change or become known in the future, such differences will impact the mine rehabilitation provision in the period in which they change or become known.

17 Deferred tax balances

(a) Recognised deferred tax balances

	30 June 2018 $'000 30 June 2017 $'000
Inventories Exploration and evaluation expenditure Property, plant and equipment Mine development Employee benefits Provisions Share issue costs Other Deferred tax balances from temporary differences Tax losses carried forward Deferred tax assets/(liabilities)	31,836 31,897 (32,710) (24,664) (13,849) (6,080) (52,539) (61,244) 10,506 10,644 44,158 44,812 1,088 2,168 (1,661) (1,485)
	(13,171) (3,952) 13,590 20,400
	419 16,448

Notes to the Consolidated Financial Statements

17 Deferred tax balances (continued)

(b) Movement in deferred tax balances during the year

	Balance at 1 July 2017 $'000 Recognised in profit or loss $'000 Utilised to reduce tax liability $'000 Balance at 30 June 2018 $'000
Inventories Exploration and evaluation expenditure Property, plant and equipment Mine development Employee benefits Provisions Share issue costs Tax losses carried forward Other Deferred tax assets	31,897 (61) - 31,836 (24,663) (8,047) - (32,710) (6,079) (7,770) - (13,849) (61,244) 8,705 - (52,539) 10,644 (138) - 10,506 44,811 (653) - 44,158 2,168 (1,080) - 1,088 20,400 13,654 (20,463) 13,591 (1,486) (176) - (1,662)
	16,448 4,434 (20,463) 419

(c) Tax losses

The Group has unrecognised available tax losses of $33.382 million as at 30 June 2018. These tax losses have not been recognised due to the uncertainty of their recoverability in future periods.

Accounting estimates and judgements

Judgement is required to determine whether deferred tax assets are recognised in the Balance Sheet. Management must assess the likelihood that the Group will generate sufficient taxable earnings in future periods in order to recognise and utilise those deferred tax assets. Estimates of future taxable income are based on forecast cash flows from operations and existing tax laws. These assessments require the use of estimates such as commodity prices and operating performance over the life of the assets. To the extent that cash flows and taxable income differ significantly from estimates, the Group's ability to realise the deferred tax assets reporting could be impacted.

Notes to the Consolidated Financial Statements

Risk and Unrecognised Items

This section of the notes discusses the Group’s exposure to various risks and shows how these could affect the Group’s financial position and performance as well as providing information on items that are not recognised in the financial statements as they do not (yet) satisfy the recognition criteria.

18 Financial risk management

The Group’s activities expose it to a variety of financial risks such as market risk (including interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group.

Risk management is carried out at a corporate level under policies approved by the Board of Directors. Management identifies, evaluates and hedges financial risks in close co-operation with the Group’s operating units. The Board of Directors approves written principles for overall risk management, as well as policies covering specific areas, such as interest rate risk, credit risk, gold price risk and use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

The Group holds the following financial instruments:

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Financial Assets Cash and cash equivalents Trade and other receivables (excluding GST refundable) Available-for-sale financial assets Financial Liabilities Trade and other payables Interest bearing liabilities	323,226 67,795 5,536	37,385 58,770 4,962
	396,557	101,117
	152,367 385,966	156,627 436,124
	538,333	592,751

(a) Derivatives

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group currently only designates derivatives as cash flow hedges (hedges of a particular risk associated with the cash flows of recognised assets and liabilities and highly probable forecast transactions). There are no fair value hedges or net investment hedges, nor are there any derivatives that do not classify for hedge accounting.

The Group documents at the inception of the hedging transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions have been and will continue to be highly effective in offsetting changes in fair values or cash flows of hedged items.

The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than 12 months; it is classified as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. Trading derivatives are classified as a current asset or liability.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income through the cash flow hedge reserve. The gain or loss relating to the ineffective portion is recognised immediately in the Statement of Profit or Loss within other income or other expense.

Amounts accumulated in the cash flow hedge reserve are reclassified to the Statement of Profit or Loss in the periods when the hedged item affects profit or loss for instance when the forecast sale that is hedged takes place.

Notes to the Consolidated Financial Statements

18 Financial risk management (continued)

(a) Derivatives (continued)

When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately reclassified to profit or loss. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset (for example, fixed assets) the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in profit or loss as depreciation in the case of fixed assets.

Derivatives are only used for economic hedging purposes and not as speculative investments. The Group has no derivative financial instruments at 30 June 2018 (nil for 2017).

(b) Market risk

(i) Foreign exchange risk

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the Group's functional currency. Management has set up a policy to manage their foreign exchange risk against their functional currency and is measured using sensitivity analysis and cash flow forecasting.

As at 30 June 2018, the Group held US$0.766 million (30 June 2017: US$4.634 million) in US dollar currency bank accounts, outstanding receivables of US$6.875 million (30 June 2017: US$8.252 million) relating to the Mt Carlton operation and US$34.661 million (30 June 2017: US$30.970 million) relating to Ernest Henry. An increase/decrease in AUD:USD foreign exchange rates of 5% will result in a $38,280 (30 June 2017: $231,700) increase/decrease in US dollar currency bank account balances and a $2,076,815 (30 June 2017: $1,961,100) increase/decrease in US dollar receivables.

The Group also held NZ$ nil (30 June 2017: NZ$0.041 million) in a NZ dollar currency bank account.

(ii) Price risk

The Group is currently exposed to the risk of fluctuations in prevailing market commodity prices on the gold, silver and copper currently produced from its gold mines and market share prices on the available-for-sale assets. The Group has in place physical gold delivery contracts as at 30 June 2018 covering sales of 250,000 oz (30 June 2017: 458,495 oz) of gold at an average flat forward price of $1,711 (30 June 2017: $1,645). An increase/decrease in market share prices on available-for-sale assets of 10% will result in a $553,643 (30 June 2017: $496,107) increase/decrease in available-for-sale assets.

(iii) Cash flow and fair value interest rate risk

The Group’s interest rate risk arises from variable interest rates on interest bearing liabilities. As at 30 June 2018, the Group held interest bearing liabilities of $395 million (30 June 2017: $435 million) which incurs interest at a variable rate. An increase/decrease of variable interest rates of 0.25% will result in a $1.849 million (30 June 2017: 0.25%, $1.658million) increase/decrease in interest expense relating to interest bearing liabilities.

(c) Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s receivables from customers, and cash and investment securities held with banks. At the balance sheet date there were no significant concentrations of credit risk given customers and banks have investment grade credit ratings. The total trade and other receivables outstanding at 30 June 2018 was $71.296 million (30 June 2017: $63.119 million). Cash and cash equivalents at 30 June 2018 were $323.2 million (30 June 2017: $37.4 million).

(d) Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as and when they fall due. Prudent liquidity risk management implies maintaining sufficient cash and term deposits, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions. The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.

Notes to the Consolidated Financial Statements

18 Financial risk management (continued)

(d) Liquidity risk (continued)

(i) Financing arrangements

The Group had access to the following undrawn borrowing facilities at the end of the reporting period:

	30 June 2018 $'000 30 June 2017 $'000
Bank loans - revolving credit facility Expiring beyond one year	350,000 300,000
	350,000 300,000

(ii) Maturities of financial liabilities

The tables below analyses the Group's financial liabilities into relevant maturity groupings based on their contractual maturities for:

all non-derivative financial liabilities, and
net and gross settled derivative financial instruments for which the contractual maturities are essential for an understanding of the timing of the cash flows.

The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

	Less than 1 year $'000 Between 1 and 2 years $'000 Between 2 and 5 years $'000 Over 5 years $'000 Total contractual cash flows $'000 Carrying amount (assets)/ liabilities $'000
At 30 June 2018 Space Non-derivatives Trade and other payables Finance lease liabilities Other borrowings Bank loans At 30 June 2017 Space Non-derivatives Trade and other payables Finance lease liabilities Other borrowings Bank loans	152,367 - - - 152,367 152,367 - - - - - - - - - - - - 109,826 119,873 195,858 - 425,557 395,000
	262,193 119,873 195,858 - 577,924 547,367
	156,627 - - - 156,627 156,627 1,344 - - - 1,344 1,344 6,870 - - - 6,870 6,870 64,356 163,660 233,036 - 461,052 435,000
	229,197 163,660 233,036 - 625,893 599,841

Notes to the Consolidated Financial Statements

18 Financial risk management (continued)

(e) Risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern, so as to maintain a strong capital base sufficient to maintain future exploration and development of its projects. In order to maintain or adjust the capital structure, the Group may return capital to shareholders, issue new shares or sell assets to reduce debt. The Group’s focus has been to raise sufficient funds through equity and debt capital markets to fund capital investment in working capital and exploration and evaluation activities.

The Group monitors its liquidity through analysis of regular cash flow forecasts.

(i) Loan covenants

The lenders have placed covenants over the Group's Senior Secured Revolving and Term Facility based on the current ratio, leverage ratio, debt service ratio and the tangible net worth ratio. The Group has complied with these covenants during the year.

19 Contingent liabilities and contingent assets

(a) Contingent liabilities

The Group had contingent liabilities at 30 June 2018 in respect of:

(i) Claims

At the date of this report the Group was unaware of any material claims, actual or contemplated.

(ii) Guarantees

The Group has provided bank guarantees in favour of various government authorities and service providers with respect to site restoration, contractual obligations and premises at 30 June 2018. The total of these guarantees at 30 June 2018 was $132.356 million with various financial institutions (30 June 2017: $125.183 million).

20 Commitments

(a) Capital and lease commitments

(i) Exploration expenditure commitments

In order to maintain current rights of tenure to exploration tenements the Group is required to perform minimum exploration work to meet minimum expenditure requirements specified by various government authorities. These obligations are subject to renegotiation when application for a mining lease is made and at various other times. These obligations are not provided for in the financial report and are payable:

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Within one year Later than one year but not later than five years Later than five years	10,479 30,756 40,236	7,529 15,873 31,707
	81,471	55,109

Notes to the Consolidated Financial Statements

20 Commitments (continued)

(a) Capital and lease commitments

(ii) Capital commitments

The Group has the following capital commitments in relation to capital projects and joint venture requirements at each of the sites.

	30 June 2018 $'000 30 June 2017 $'000
Within one year	17,619 26,227
	17,619 26,227

(iii) Non-cancellable operating leases

The Group leases mining equipment, office space and small items of office equipment under operating leases. The leases typically run for one month to five years with an option to renew at the expiry of the lease period. None of these leases include contingent rentals.

	30 June 2018 $'000 30 June 2017 $'000	30 June 2018 $'000 30 June 2017 $'000
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows: Within one year Later than one year but not later than five years Later than five years	14,576 9,355 1,145	23,209 5,231 -
	25,076	28,440

(b) Gold delivery commitments

	Gold for physical delivery oz Contracted sales price A$/oz Value of committed sales $'000	Gold for physical delivery oz Contracted sales price A$/oz Value of committed sales $'000	Gold for physical delivery oz Contracted sales price A$/oz Value of committed sales $'000
As at 30 June 2018 Within one year Later than one year but not greater than five years As at 30 June 2017 Within one year Later than one year but not greater than five years	150,000 100,000	1,694 1,737	254,037 173,667
	250,000	3,431	427,704
	208,495 250,000	1,567 1,711	319,156 427,705
	458,495	3,278	746,861

Notes to the Consolidated Financial Statements

20 Commitments (continued)

(b) Gold delivery commitments

The counterparties to the physical gold delivery contracts are Australia and New Zealand Banking Group Limited ("ANZ"), National Australia Bank Limited ("NAB"), Commonwealth Bank of Australia ("CBA"), Citibank N.A ("Citibank") and Societe Generale ("SG"). Contracts are settled on a quarterly basis by the physical delivery of gold per the banks instructions. The contracts are accounted for as sale contracts with revenue recognised once the gold has been delivered to Macquarie, ANZ, NAB, WBC, CBA, Citibank, SG or one of their agents. The physical gold delivery contracts are considered a contract to sell a non-financial item and is therefore out of the scope of AASB 139 Financial Instruments: Recognition and Measurement . As a result no derivatives are required to be recognised. The Company has no other gold sale commitments with respect to its current operations.

21 Events occurring after the reporting period

(a) Restructure of Ownership of Castle Hill Gold Deposit

On 18 July, the Company reached an agreement to terminate Norton Gold Field’s right to mine and process ore from the Castle Hill deposit. This provides Evolution with full ownership and unfettered access to the deposit located 25km from the Mungari processing facility. Castle Hill is estimated to contain Ore Reserves of 236,000oz which will provide a material extension to the operating life at Mungari. Evolution will pay an initial up-front cash payment of $12 million (paid 31 July 2018), a further $3 million six months after completion of the transaction and a 2% net smelter royalty over the first 38,000oz of gold production from certain tenements within the Castle Hill deposit area.

(b) Resignation of La Mancha Directors

On 26 July, it was announced that La Mancha had undertaken a block trade monetisation of shares reducing its direct interest in Evolution to 9.6%. In accordance with the terms of the Share Sale Agreement signed between Evolution and La Mancha in April 2015, La Mancha had the right to nominate Directors to the Board of Evolution provided that it held more than 10.0% of the shares on issue in Evolution. La Mancha's nominee Directors, Mr Naguib Sawiris, Mr Sebastian de Montessus and their Alternate Director, Mr Andrew Wray resigned from the Board of Directors of Evolution effective 1 August 2018.

Notes to the Consolidated Financial Statements

Other Information

This section covers additional financial information and mandatory disclosures.

22 Ernest Henry Operation

(a) Description

On 24 August 2016, the Group announced that through a wholly owned subsidiary, it had entered into a transaction with Glencore plc to acquire an economic interest in the Ernest Henry Copper-Gold Operation for an up-front payment of $880 million. This $880 million up-front payment is recognised as a mine development asset. The Group also announced the entry into a strategic alliance with Glencore plc in respect of potential future regional acquisitions and the commitment the parties made to cooperate on exploration activities in the region surrounding Ernest Henry. The transaction was completed on 1 November 2016.

Under the agreement, the Group has a right to the production output when produced in relation to 100% of future gold and 30% of future copper and silver from the agreed life of mine area. Copper and silver sales revenue are recognised in the same month as their production is reported as the production is in control of the purchaser (Glencore). Gold sales and gold revenues are recognised when the metal is received and sold by Evolution. In addition to the up-front payment, the Group must also contribute 30% of future production costs in respect of the life of mine area.

The Group has agreed to an ongoing obligation to pay an amount equal to 49% of development and production costs in return for 49% of future copper, gold and silver production from new reserves extending beyond the mine life at acquisition date.

(b) Financial performance and position

The below information presents the financial performance and balance sheet information of the Ernest Henry operation included in the Consolidated Financial Statements for the eight months ended 30 June 2017.

	30 June 2018 $'000 30 June 2017 $'000
Revenue (note 2) Cost of sales (excluding amortisation) Amortisation Profit before income tax	347,403 163,342 (116,427) (64,108) (125,669) (64,902)
	105,307 34,332

Notes to the Consolidated Financial Statements

22 Ernest Henry Operation (continued)

(b) Financial performance and position (continued)

The carrying amounts of assets and liabilities as at the period end were:

	30 June 2018 $'000 30 June 2017 $'000
Assets Trade and other receivables Inventories Mine Development Total assets Liabilities Trade and other payables Total liabilities Net assets	46,897 40,263 26,145 25,210 696,548 811,178
	769,590 876,651
	29,157 29,522
	29,157 29,522
	740,433 847,129

23 Related party transactions

(a) Parent entities

The ultimate parent entity within the Group is Evolution Mining Limited.

(b) Subsidiaries

Interests in subsidiaries are set out in note 27.

(c) Key management personnel compensation

	30 June 2018 $ 30 June 2017 $	30 June 2018 $ 30 June 2017 $
Short-term employee benefits Post-employment benefits Share-based payments	7,888,131 168,858 4,646,895	6,907,351 156,931 2,939,830
	12,703,884	10,004,112

Detailed remuneration disclosures are provided in the remuneration report on pages 21 to 36.

Notes to the Consolidated Financial Statements

23 Related party transactions (continued)

(d) Transactions with other related parties

Directors fees in the amount of $115,000 were paid to International Mining and Finance Corp, a company of which Mr James Askew is a Director for services provided during the period (30 June 2017:$113,750).

Directors fees in the amount of $300,000 were paid to DAK Corporation Pty Ltd, a company of which Mr Jacob Klein is a Director for services provided during the period (30 June 2017: $200,000).

Directors fees in the amount of $135,000 were paid to Lazy 7 Pty Ltd, a company of which Mr Colin Johnstone is a Director for services provided during the period (30 June 2017: $137,748).

Directors fees in the amount of $95,000 were paid to Mr Naguib Sawiris as a Director for services provided during the period (30 June 2017: $95,000).

Directors fees in the amount of $105,000 were paid to Mr Sebastien de Montessus as a Director for services provided during the period (30 June 2017: $104,375).

24 Share-based payments

(a) Types of share based payment plans

The Group has two Option and Performance Rights plans in existence:

(1) Employee Share Option and Performance Rights Plan (ESOP)

The ESOP was established and approved at the Annual General Meeting on 23 November 2010, and amended on 19 October 2011. The latest plan was approved at the Annual General Meeting on 26 November 2014 and permits the Company, at the discretion of the Directors, to grant both Options and Performance Rights over unissued ordinary shares of the Company to eligible Directors and members of staff as specified in the plan rules.

(2) Non-Executive Director Equity Plan (NEDEP)

The NEDEP was established and approved at the Annual General Meeting on 24 November 2016. The plan permits the Company, at the discretion of the Directors, to grant NED Share Rights as part of their remuneration.

(b) Recognised share based payment expenses

	30 June 2018 $'000 30 June 2017 $'000
Expense arising from equity settled share based payment transactions recognised in profit and loss	8,491 6,413

(c) Summary and movement of NED Share Rights on issue

The following table illustrates the number and movements in, Share Rights issued during the year.

	2018 2017
	Number Number
Outstanding balance at the beginning of the year Share Rights granted Vested Lapsed Forfeited Outstanding balance at the end of theyear	97,788 - 116,879 97,788 (97,788) - - - - -
	116,879 97,788

Notes to the Consolidated Financial Statements

24 Share-based payments (continued)

(c) Summary and movement of NED Share Rights on issue (continued)

There were 116,879 Share Rights granted during the 2018 financial year. Provided the NEDs remain directors of Evolution, Share Rights will vest and automatically exercise 12 months after the grant date of 23 November 2017.

(d) Fair value determination

During the year, the Company issued two allotments of performance rights that will vest on 30 June 2020. They have four performance components being a Total Shareholder Return (“TSR”) condition, an absolute TSR condition, a Growth in Earnings per share (“EPS”) condition and a Growth in Ore Reserves condition.

(i) TSR Performance Right Valuation

The fair value of the TSR Performance Rights (market-based condition) was estimated at the date of grant using Monte Carlo simulation, taking into account the terms and conditions upon which the awards were granted.

(ii) Absolute TSR Performance Right Valuation

The Absolute TSR Performance Right Valuation will be measured as the cumulative annual TSR over the three year period ending 30 June 2020.

(iii) Growth in Earnings per Share

The growth in Earnings per Share is measured as the cumulative annual growth rate in EPS, excluding non recurring items over the three year period ending 30 June 2020.

(iv) Growth in Ore Reserves per Share

The growth in Ore Reserves per share is measured by comparing the Baseline measure of the Ore Reserves as at 31 December 2015, to the Ore Reserves as at 31 December 2018 on a per share basis, with testing to be performed at 30 June 2019.

The following tables list the inputs to the models used for the Performance Rights granted for the period:

	TSR	Absolute TSR	Growth in EPS	Growth in Ore
				Reserves
September 2017 Performance Rights issue
Number of rights issued	1,516,766	1,516,766	1,516,766	1,516,766
Spot price ($)	2.410	2.410	2.410	2.410
Risk-free rate (%)	2.05	2.05	2.05	2.05
Term (years)	2.8	2.8	2.8	2.8
Volatility (%)	58	58	58	58
Fair value at grant date ($)	1.51	1.28	2.26	2.26
February 2018 Performance Rights issue
Number of rights issued	130,627	130,627	130,627	130,627
Spot price ($)	2.810	2.810	2.810	2.810
Risk-free rate (%)	2.05	2.05	2.05	2.05
Term (years)	2.4	2.4	2.4	2.4
Volatility (%)	53	53	53	53
Fair value at grant date ($)	1.85	1.55	2.66	2.66

The volatility above was determined with reference to historical volatility but also incorporates factors that management believes will impact the actual volatility of the Company’s shares in future periods.

Recognition and measurement

The Group provides benefits to its employees (including Key Management Personnel) in the form of share-based payments, whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).

Notes to the Consolidated Financial Statements

24 Share-based payments (continued)

Recognition and measurement (continued)

Vesting conditions that are linked to the price of shares of the Company (market conditions) are taken into account when determining the fair value of equity settled transactions. Other vesting conditions such as service conditions are excluded from the measurement of fair value but are considered in estimating the number of investments that may ultimately vest.

The cost of these equity-settled transactions is measured by reference to the fair value of the equity instruments at the date at which they are granted.

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled (“the vesting period”).

The charge to the Statement of Profit or Loss for the period is the cumulative amount as calculated above less the amounts already recognised in previous periods. There is a corresponding entry to equity.

Accounting estimates and judgements

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of equity instruments at the date at which they are granted. The fair value is determined by an external specialist using an option pricing model, based off the assumptions detailed above.

25 Remuneration of auditors

During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices and non-related audit firms:

(a) PricewaterhouseCoopers

	2018 $ 2017 $
Audit and other assurance services Audit and review of financial statements Other assurance services Assurance related services Total remuneration for audit and other assurance services Taxation services Tax compliance services Tax advisory services Total remuneration for taxation services Total remuneration of PricewaterhouseCoopers	510,920 511,940 - 140,413
	510,920 652,353
	- 89,391 8,670 402,939
	8,670 492,330
	519,590 1,144,683

Notes to the Consolidated Financial Statements

25 Remuneration of auditors (continued)

(b) Non-PricewaterhouseCoopers related audit firms

	2018 $ 2017 $
Audit and other assurance services Other assurance services Internal audit services Other assurance services Total remuneration for audit and other assurance services Taxation services Tax compliance services Tax advisory services Total remuneration for taxation services Total remuneration of non-PricewaterhouseCoopers audit firms Total auditors' remuneration	168,971 114,348 259,965 20,000
	428,936 134,348
	397,215 111,861 254,242 291,424
	651,457 403,285
	1,080,393 537,633
	1,599,983 1,682,316

It is the Group's policy to employ PricewaterhouseCoopers on assignments additional to their statutory audit duties where PricewaterhouseCoopers's expertise and experience with the Group are important. These assignments are principally tax advice and due diligence on acquisitions, or where PricewaterhouseCoopers is awarded assignments on a competitive basis. It is the Group's policy to seek competitive tenders for all major consulting projects.

26 Deed of cross guarantee

Evolution Mining Limited and those entities identified in note 27 are parties to a deed of cross guarantee under which each Company guarantees the debts of the others. By entering into the deed, the wholly-owned entities have been relieved from the requirement to prepare a financial report and Directors' Report under Class Order 98/1418 (as amended) issued by the Australian Securities and Investments Commission.

The companies identified above represent a 'closed group' for the purposes of the Class Order, and as there are no other parties to the deed of cross guarantee that are controlled by Evolution Mining Limited, they also represent the 'extended closed group'.

The Consolidated Balance Sheet, Consolidated Statement of Profit or Loss and Other Comprehensive Income, and summary of movements in consolidated retained earnings for the year ended 30 June 2018 of the closed group is equal to the Consolidated Balance Sheet, Consolidated Statement of Profit or Loss and Other Comprehensive Income, and Consolidated Statement of Changes in Equity of the Group.

Notes to the Consolidated Financial Statements

27 Interests in other entities

(a) Significant investments in subsidiaries

The consolidated financial statements incorporate the assets, liabilities and results of the following principal subsidiaries in accordance with the accounting policy described below:

			Equity holding	Equity holding
	Country of		2018	2017
Name of entity	incorporation	Class of shares	%	%
Evolution Mining Management Services Pty Ltd	Australia	Ordinary		100	100
Conquest Mining Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Edna May Ops Pty Ltd (i) (ii)	Australia	Ordinary		-	100
Mt Rawdon Operations Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Westonia Mines Minerals Pty Ltd (i)	Australia	Ordinary		100	100
Lion Selection Pty Ltd (i)	Australia	Ordinary		100	100
Auselect Pty Ltd (i)	Australia	Ordinary		100	100
Lion Mining Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Sedgold Pty Ltd (i)	Australia	Ordinary		100	100
Fernyside Pty Ltd (i)	Australia	Ordinary		100	100
Evolution Tennant Creek Pty Ltd (ii)	Australia	Ordinary		100	100
Evolution Mining NZ Pty Ltd (ii)	Australia	Ordinary		100	100
Evolution Mining (Cowal) Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Evolution Mining Mungari Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Toledo Holding (Ausco) Pty Ltd (i)	Australia	Ordinary		100	100
Evolution Mining (Mungari East) Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Evolution Mining (Phoenix) Pty Limited (i) (ii)	Australia	Ordinary		100	100
Hayes Mining Pty Ltd (i)	Australia	Ordinary		100	100
Evolution Mining (Aurum 2) Pty Ltd (i) (ii)	Australia	Ordinary		100	100
Evolution Mining (Connors Arc) Pty Ltd (i) (ii)	Australia	Ordinary		100	-
Evolution Mining (Canada Holdings) Ltd (ii)	Canada	Ordinary		100	-
Evolution Mining Management Services (Canada) Ltd (ii)	Canada	Ordinary		100	-

(i) These subsidiaries have been granted relief from the necessity to prepare financial reports in accordance with Class Order 98/1418 issued by the Australian Securities and Investments Commission. For further information refer to note 26. (ii) These entities are considered to be the material controlled entities of the Group. Their principal activities are identifying, developing and operating gold related projects.

Unless otherwise stated, they have share capital consisting solely of ordinary shares that are held directly by the Group, and the proportion of ownership interests held equals the voting rights held by the Group. The country of incorporation or registration is also their principal place of business.

Notes to the Consolidated Financial Statements

28 Parent entity financial information

The financial information for the parent entity, Evolution Mining Limited has been prepared on the same basis as the consolidated financial statements.

(b) Summary financial information

The individual financial statements for the parent entity show the following aggregate amounts:

	30 June 2018 $'000 30 June 2017 $'000
Balance sheet Space Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Total liabilities Net assets Shareholders' equity Space Issued capital Reserves Fair Value revaluation reserve Share based payment reserve Accumulated losses Total equity Statement of Profit or Loss and Other Comprehensive Income Space Profit for the year Other comprehensive expense Total comprehensive expense	316,591 27,659 2,065,188 2,385,766
	2,381,779 2,413,425
	158,438 101,283 294,284 406,690
	452,722 507,973
	1,929,057 1,905,452
	2,183,727 2,183,727 1,131 3,042 45,566 37,075 (301,367) (318,392)
	1,929,057 1,905,452
	126,882 82,842 - -
	126,882 82,842

(c) Guarantees entered into by the parent entity

The parent entity has provided bank guarantees, as detailed in note 19.

(d) Contingent liabilities of the parent entity

The parent entity did not have any contingent liabilities as at 30 June 2018 or 30 June 2017. For information about guarantees given by the parent entity, please see above.

Notes to the Consolidated Financial Statements

29 Summary of significant accounting policies

(a) Basis of preparation

This financial report is a general purpose financial report, prepared by a for-profit entity, in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards Board (AASB).

The financial report also complies with the International Financial Reporting Standards (IFRS) including interpretations as issued by the International Accounting Standards Board (IASB).

The financial report has been prepared on a historical cost basis, except for derivative financial instruments and available-for-sale assets which have been measured at fair value.

The financial report has been presented in Australian (AU) dollars and all values are rounded to the nearest AU$1,000 (AU$'000) unless otherwise stated.

The accounting policies have been consistently applied by all entities included in the Group and are consistent with those applied in the prior year.

(b) Principles of consolidation

The consolidated financial statements include the financial statements of the parent entity, Evolution Mining Limited, and its controlled entities (referred to as 'the Consolidated Entity' or 'the Group' in these financial statements). A list of significant controlled entities (subsidiaries) is presented in note 27.

Control is achieved when the Group is exposed, or has the rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one of more of the three elements of control. Specifically the Group controls an investee if, and only if, the Group has all of the following:

Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee);
Exposure, or rights, to variable returns from its involvement with the investee; and
The ability to use its control over the investee to affect its returns.

Non- controlling interests in the results and equity of the entities that are controlled by the Group is shown separately in the Statement of Profit or Loss or Other Comprehensive Income, Balance Sheet and Statement of Changes in Equity respectively.

(c) Foreign currency translation

(i) Functional and presentation currency

The presentation currency of the Group is Australian dollars. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

(ii) Transactions and balances

Transactions in foreign currencies are initially recorded in the functional currency at the exchange rates ruling at the date of the transaction. The subsequent payment or receipt of funds related to a transaction is translated at the rate applicable on the date of payment or receipt. Monetary assets and liabilities are denominated in foreign currencies are retranslated at the rate of exchange ruling at the reporting date. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate as at the date of the initial transaction.

All exchange differences in the consolidated financial statements are taken to the Statement of Other Comprehensive Income and accumulated in a reserve.

Notes to the Consolidated Financial Statements

29 Summary of significant accounting policies (continued)

(c) Foreign currency translation (continued)

(iii) Translation

The assets and liabilities of subsidiaries with functional currency other than Australian dollars (being the presentation currency of the Group) are translated into Australian dollars at the exchange rate at the reporting date and the Statement of Profit or Loss is translated at the average exchange rate for the period. On consolidation, exchange differences arising from the translation of these subsidiaries are recognised in Other Comprehensive Income and accumulated in the foreign currency translation reserve.

(d) Intangible assets

(i) Mining tenements, mining rights and mining information

Mining tenements have a finite useful life and are carried at cost less, where applicable, any accumulated amortisation and accumulated impairment losses. The carrying values of mining tenements and mining rights are reviewed to ensure they are not in excess of their recoverable amounts. Amortisation of mining tenements and mining rights commences from the date when commercial production commences or in the case of the acquisitions, from the date of acquisition and is charged to the profit or loss. Mining tenements are amortised over the life of the mine using units of production basis in ounces.

Mining information has a finite useful life and is carried at cost less accumulated amortisation. Mining information amortisation is recognised over the period that the information is expected to remain relevant.

The amortisation of the above intangibles is classified as a cost of sale.

30 New accounting standards

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2018 reporting periods and have not been early adopted by the Group. The Group’s assessment of the impact of these new standards and interpretations is set out below.

Title of	Nature of change	Impact	Mandatory
standard			application
			date/ Date of
			adoption by
			group
AASB 15	The AASB has issued a new	Management has assessed the effects of applying	Mandatory for
Revenue	standard for the recognition of	the new standard on the group’s financial	financial years
from	revenue. This will replace AASB 118	statements and on the recognition of revenue	commencing on
Contracts	which covers contracts for goods	derived through the sale of gold and concentrate.	or after 1
with	and services and AASB 111 which	Management have concluded that there is no	January 2018.
Customers	covers construction contracts.	material impact in the treatment of revenue
	The new standard is based on the	recognition following transition to AASB 15.
	principle that revenue is recognised	The new standard introduces new disclosure
	when control of a good or service	requirements. These are expected to change the
	transfers to a customer.	nature and extent of the group’s disclosures with
	The standard permits either a full retrospective or a modified	regards to revenue particularly in the year of the adoption of the new standard.
	retrospective approach for the
	adoption.

Notes to the Consolidated Financial Statements

30 New accounting standards (continued)

Title of	Nature of change	Impact	Mandatory
standard			application
			date/ Date
			of adoption
			by group
AASB 9	AASB 9 addresses	The group has reviewed its financial assets and liabilities and is	Must be
Financial	the classification,	expecting the following impact from the adoption of the new standard on	applied for
Instruments	measurement and	1 July 2018:	financial
	derecognition of financial assets and financial liabilities,	Financial assets held by the group are broken down as follows: • Equity instruments currently classified as Available For Sale (AFS) for	years commencing on or after 1
	introduces new rules for hedge accounting and a new impairment model for financial	which a Fair Value through Other Comprehensive Income (FVOCI) election is available; • Cash and cash equivalents including current accounts and short-term term deposits, and; • Trade receivables currently held at cost, to be measured at amortised	January 2018. The group will apply the new rules
	assets.	cost under the classification conditions for AASB 9.	retrospectively
		The group does not expect the new guidance to affect the classification and measurement of these financial assets. However, gains or losses realised on the sale of financial assets designated as FVOCI will no longer be transferred to profit or loss on sale, but instead reclassified below the line from the FVOCI reserve to retained earnings. During the 2018 financial year, no gains or losses were recognised in profit or loss in relation to the disposal of available-for-sale financial assets.	from 1 July 2018, with the practical expedients permitted under the standard. Comparatives
		There will be no impact on the group’s accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through profit or loss and the group	for FY18 will not be restated.
		does not have any such liabilities. The derecognition rules have been
		transferred from AASB 139 Financial Instruments: Recognition and
		Measurement and have not been changed.
		The new hedge accounting rules under AASB 9 have no impact as the
		group is not currently hedge accounting.
		The new impairment model requires the recognition of impairment
		provisions based on expected credit losses (ECL) rather than only
		incurred credit losses as is the case under AASB 139. It applies to
		financial assets classified at amortised cost, debt instruments measured
		at FVOCI, contract assets under AASB 15 Revenue from Contracts with
		Customers, lease receivables, loan commitments and certain financial
		guarantee contracts. Based on the assessments undertaken to date, the
		group expects no impact on the allowances for trade receivables or
		cash and cash equivalents as the only applicable financial assets.
		The new standard also introduces expanded disclosure requirements
		and changes in presentation. These are expected to change the nature
		and extent of the group’s disclosures about its financial instruments
		particularly in the year of the adoption of the new standard.

Notes to the Consolidated Financial Statements

30 New accounting standards (continued)

Title of	Nature of change	Impact	Mandatory
standard			application
			date/ Date of
			adoption by
			group
AASB 16	AASB 16 was issued in February	The standard will affect primarily the accounting for	Mandatory for
Leases	2016. It will result in almost all	the Group’s operating leases. As at the reporting	financial years
	leases being recognised on the	date, the Group has non-cancellable operating	commencing on
	balance sheet, as the distinction	lease commitments of $25.076 million, see note 20.	or after 1
	between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are	To date, the group has focussed on the provisions of the standard that will most impact the financial results. Below is a summary of the work performed and the assessed impact of the new standard:	January 2019. At this stage, the Group does not intend to adopt the
	recognised. The only exceptions are short-term and low-value leases.	• Data gathering: Site and group data has been	standard before its effective
		collated related to contracts that may contain a	date.
		lease.
		• Data integrity and analysis: a number of the identified contracts are covered by the exception for short-term and low-value leases and some	The group intends to apply the modified
		commitments may relate to arrangements that will not qualify as leases under AASB 16.	retrospective transition
		• Modelling of transition options: Review of the	approach and will not restate
		transition options indicates that there is not a material difference to the group between the three	comparative amounts for the
		transition methodologies. Accordingly, the group intends to apply the modified retrospective transition approach.	year prior to first adoption.
		• Financial reporting: Preliminary review results
		indicate that under the requirements of AASB 16, a
		lease asset and liability would be recorded on
		balance sheet of approximately $20m-$25m if the
		standard applied at 30 June 2018.
		Work will continue during FY19 on the
		implementation of processes and systems prior to
		the effective date of 1 July 2019.

There are no other standards that are not yet effective and that would be expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.

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Directors' Declaration

In the Directors' opinion:

(a) the financial statements and notes set out on pages 40 to 84 are in accordance with the Corporations Act 2001 , including: (i) complying with Accounting Standard, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and
(ii) giving a true and fair view of the consolidated entity's financial position as at 30 June 2018 and of its performance for the year ended on that date, and
(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.
(c) at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed group identified in note 26 will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of the deed of cross guarantee described in note 26.

Note 29(a) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board.

The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section 295A of the Corporations Act 2001 .

This declaration is made in accordance with a resolution of Directors.

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Jacob (Jake) Klein Executive Chairman

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Andrea Hall Chair of the Audit Committee

Sydney

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Independent auditor’s report

To the members of Evolution Mining Limited

Report on the audit of the financial report

Our opinion

In our opinion:

The accompanying financial report of Evolution Mining Limited (the Company) and its controlled entities (together the Group) is in accordance with the Corporations Act 2001 , including:

a) giving a true and fair view of the Group's financial position as at 30 June 2018 and of its financial performance for the year then ended
b) complying with Australian Accounting Standards and the Corporations Regulations 2001 .

What we have audited

The Group financial report comprises:

the consolidated statement of profit or loss and other comprehensive income for the year ended 30 June 2018
the consolidated balance sheet as at 30 June 2018
the consolidated statement of changes in equity for the year then ended
the consolidated statement of cash flows for the year then ended
the notes to the consolidated financial statements, which include a summary of significant accounting policies
the directors’ declaration.

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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (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.

One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001 T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au

Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124 T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au

PricewaterhouseCoopers, ABN 52 780 433 757

Liability limited by a scheme approved under Professional Standards Legislation.

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Our audit approach

An audit is designed to provide reasonable assurance about whether the financial report is free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report.

We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial report as a whole, taking into account the geographic and management structure of the Group, its accounting processes and controls and the industry in which it operates.

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	*Materiality*		*Audit scope*		*Key audit matters*
•	For the purpose of our audit	•	Our audit focused on where	•	Amongst other relevant topics,
	we used overall Group		the Group made subjective		we communicated the following
	materiality of $19.9 million,		judgements; for example,		key audit matters to the Audit
	which represents		significant accounting		Committee:
	approximately 2.5% of the		estimates involving
	Group’s earnings before		assumptions and inherently		− Valuation of assets at
	interest, tax, depreciation and		uncertain future events.		Mungari and Cowal
	amortisation (EBITDA).
		•	Our audit procedures were		− Assessment of the carrying
•	We applied this threshold,		predominantly performed at		value of assets
	together with qualitative		the Group’s corporate office in
	considerations, to determine		Sydney. We also conducted	•	These are further described in
	the scope of our audit and the		site visits to the Mt Carlton		the_Key audit matters_section
	nature, timing and extent of		mine site.		of our report.
	our audit procedures and to
	evaluate the effect of
	misstatements on the
	financial report as a whole.

We chose EBITDA because, in our view, it is the benchmark against which the performance of the Group is most commonly measured.
We utlised a 2.5% threshold based on our professional judgement, noting it is within the range of commonly acceptable thresholds.

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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 for the current period. The key audit 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. Further, any commentary on the outcomes of a particular audit procedure is made in that context.

Key audit matter How our audit addressed the key audit matter Valuation of assets held at Mungari and Cowal (Refer to note 3, 7 and 8) We have performed the following procedures, amongst others, to assess the valuations and associated accounting and tax impact:

The Group obtained external valuations of the open cut pit mine development and property, plant and equipment at Cowal and the open cut pit and underground mine development at Mungari. The valuations were conducted principally to obtain accurate values for the assets to support the Group’s income tax positions.

For the external valuations we:

read the valuation reports and considered the approach applied by the external valuer,
• assessed the competency and capabilities of the external valuer,
read the valuer’s terms of engagement and did not identify any terms that might affect their objectivity or impose limitations on their work relevant to the valuation,

The resulting consequence of the valuations are as follows:

Agreed the impact of the valuations to the Group’s accounting records.
A current year balance sheet reclassification of $90.5 million from Property, Plant and Equipment to Mine Development, with a resulting $2.9 million of additional mine development amortisation recognised in the current year,
• A reduction in income tax expense for the current year of $22.7m due to net additional tax values of the assets.

For the associated accounting impact, we recalculated the accuracy of the balance sheet reclassification and the resulting additional depreciation recognised as a result of the reclassification.

For the associated tax consequences we, in conjunction with our tax experts:

examined position papers prepared by management

This was a key audit matter because of the:

held various discussions with management to discuss tax positions and approach in relation to the valuations performed and proposed amendments to prior tax returns.
Inherent subjective nature and judgment involved in the assumptions applied with valuations
Relative size of Mine Development and Property, Plant and Equipment balance in the consolidated balance sheet
Significant judgement involved in assessing the tax position taken and the quantum of the additional tax benefit obtained as a result of the valuations performed.

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Key audit matter

Assessment of the carrying value of assets (Refer to note 7 and 8)

At 30 June 2018, the Group held mine development and exploration assets of $1,744 million and property, plant and equipment of $572 million.

In line with the requirements of AASB 136, the Group has assessed whether there is an indication that an asset may be impaired. This assessment considered performance against budget, adverse changes in the business or regulatory environment and changes to other key assumptions that affect cash flows and discount rates. The Group identified no indicators of impairment for any Cash Generating Unit (“CGU”).

AASB 136 also requires an assessment at each reporting date whether there is an indication that an impairment loss recognised in prior periods may no longer exist or may have decreased. If any such indication exists, the Group shall determine whether all or part of the prior impairment loss need to be reversed.

The Group previously recognised impairment losses of $148.6 million relating to the carrying value of Mt Carlton’s non-current assets in 2013 as a result of the fall in the gold price combined with a compression of valuations in the gold industry.

The Group performed an assessment of whether to reverse a portion of the previously recognised impairment losses related to Mt Carlton up to the carrying amount that would have been determined (net of amortisation) had no impairment loss been recognised. The assessment focused on changes in macro-economic factors, operating and financial performance for the period, and updates to mine plans. The Group anticipates continued strong performance at Mt Carlton which, together with the wider recovery of some gold prices, provides evidence that conditions leading to its past impairment may no longer be present. This is an indicator that the mine assets should be considered for reversal of impairment.

How our audit addressed the key audit matter

We evaluated the Group’s assessment of indicators of impairment or reversal of impairment and its conclusion not to recognise an impairment or impairment reversal.

In particular, we assessed the appropriateness of the impairment assessment that no internal or external indicators of impairment exist by evaluating the current year financial performance of each CGU and the budget and forecast as well as evaluating external market data.

In regards to the impairment reversal for Mt Carlton, we performed the following:

compared the current year US$ gold prices to the US$ gold prices when the impairment occurred
compared current gold price forecasts to gold price forecasts when the impairment occurred
considered the Group’s calculations of recoverable amount, including sensitivities of key assumptions, and compared them to the carrying value of the Mt Carlton assets
analysed market data for recent gold mine transactions and compared to the carrying value of the Mt Carlton assets.

We also evaluated the adequacy of the disclosures made in the note 8 in light of the requirements of Australian Accounting Standards.

The assessment of the carrying values of assets was a key audit matter due to the significant judgement involved in the determination as to whether or not an impairment charge or reversal relating to an asset or CGU is required.

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Other information

The directors are responsible for the other information. The other information included in the Group’s annual report for the year ended 30 June 2018 comprises the Director’s Report (but does not include the financial report and our auditor’s report thereon), which we obtained prior to the date of this auditor’s report. We also expect other information to be made available to us after the date of this auditor’s report.

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 identified above 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.

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 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 Group 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 Group or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report.

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our auditor's report.

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Report on the remuneration report

Our opinion on the remuneration report

We have audited the remuneration report included in pages 21 to 36 of the directors’ report for the year ended 30 June 2018.

In our opinion, the remuneration report of Evolution Mining Limited for the year ended 30 June 2018 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.

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PricewaterhouseCoopers

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Marc Upcroft Partner

Sydney 17 August 2018

AI assistant

EVOLUTION MINING LIMITED — Regulatory Filings 2018

64885_rns_2018-08-16_01b50faf-60be-4cac-9136-7c953fd85a04.pdf

APPENDIX 4E EVOLUTION MINING LIMITED ACN 084 669 036 AND CONTROLLED ENTITIES ANNUAL FINANCIAL REPORT For the year ended 30 June 2018

Results for Announcement to the Market

Key Information

Dividend Information

Net Tangible Assets

Earnings Per Share

Directors' Report

Directors' Report

Directors

Company Secretary

Principal activities

Key highlights for the year

Directors' Report

Key highlights for the year (continued)

Directors' Report

Operating and Financial Review

Profit Overview

Directors' Report

Operating and Financial Review (continued)

Profit Overview (continued)

Cash Flow

Directors' Report

Operating and Financial Review (continued)

Key Results

Directors' Report

Operating and Financial Review (continued)

Mining Operations

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Mungari

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Mt Rawdon

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Ernest Henry

Directors' Report

Operating and Financial Review (continued)

Mining Operations (continued)

Edna May

Financial Performance

Profit or Loss

Balance Sheet

Directors' Report

Operating and Financial Review (continued)

Financial Performance (continued)

Balance Sheet (continued)

Cash Flow

Taxation

Capital Expenditure

Directors' Report

Operating and Financial Review (continued)

Financial Performance (continued)

Financing

Material business risks

Fluctuations in the gold price and Australian dollar

Mineral Resources and Ore Reserves

Directors' Report

Operating and Financial Review (continued)

Material business risks (continued)

Replacement of depleted reserves

Mining risks and insurance risks

Production and cost estimates

Environmental, health and safety, and permits

Directors' Report

Operating and Financial Review (continued)

Material business risks (continued)

Community relations

EVOLUTION MINING LIMITED Regulatory Filings 2018