MASTERMYNE GROUP LIMITED - Annual Report 2021

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Mastermyne Group Limited and its Controlled Entities ABN 96 142 490 579 Annual Financial Report 30 June 2021

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Contents
Directors Report	01
Lead Auditors Independence Declaration	23
Consolidated statement of profit or loss and other comprehensive income	24
Consolidated statement of financial position	25
Consolidated statement of changes in equity	26
Consolidated statement of cash flows	27
Notes to the consolidated financial statements	28
Directors' declaration	67
Independent auditor's report	68

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Appendix 4E

Results for announcement to market for the year ending 30 June 2021

Name of Entity Mastermyne Group Limited ABN 96 142 490 579

	30 Jun 2021	30 Jun 2020	Movement	Movement
	$000	$000	$000	%

RevenuefromOrdinaryActivities	233,067	292,670	(59,603)	-20%

Profit for the year after tax attributable to
owners of the entity	5,864	11,557	(5,693)	-49%

Earnings per share attributable to owners of the
entity
Basic earnings per share (Cents)	5.5	11.0	5.5	50%
Diluted earnings pershare (Cents)	5.4	10.9	5.5	50%
				Franked
			Amount per	Amount per
Dividend Information	Record Date	Payment Date	Security	Security
Final dividend for the year ended
30 June2021	24/09/2021	14/10/2021	0.0225	0.0225

The Company operates a Dividend Reinvestment Plan (“DRP”) which will be utilised for FY2021 final dividend. Shareholders may elect to have all or part of their dividend payment reinvested in new ordinary shares. No discount will be applied. The last day for the receipt of an election notice for participation in the plan is 27th September 2021. The Dividend Reinvestment Plan dated 22nd March 2010 can be downloaded from www.mastermyne.com.au.

		30 Jun 2021	30 Jun 2020
Net Tangible Asset Backing		$000	$000
Net tangible assets per ordinary share		0.59	0.60

The Annual General Meeting of the Company will be held at:
Location:	Level 1
	45 River Street, Mackay QLD 4740
Date:	9 November 2021
Time:	11 AM

Additional information supporting the Appendix 4E disclosure requirements can be found in the Annual Financial Report, which contains the Directors’ Report and the 30 June 2021 Financial Statements and accompanying notes.

This report is based on the consolidated financial statements for the year ended 30 June 2021, which have been audited by Pitcher Partners.

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The Directors present their report together with the financial report of Mastermyne Group Limited ('the Company') and of the Group, being the Company and its subsidiaries, for the financial year ended 30 June 2021 and the auditor's reports thereon.

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Qualifications: Bachelor of Engineering (Mining), Graduate Certificate of Management Appointed: 6 March 2014 and as Chairman on 26 February 2015

Colin brings to the Company over 30 years of mining experience in technical, operations, management and corporate roles. He is also an experienced Company Director having been in various Directorships for over twenty years.

Colin's former roles during his 27 years with BHP Billiton include President Illawarra Coal (8 years), Vice President Health, Safety and Environment (Global role) and Project Director for the BHP Billiton merger integration as well as member of the deal team for the transaction. He was also an Underground Coal Mine Manager both in New South Wales and Queensland.

Currently, Colin is also Chairman of the Flagstaff Group and Destination Wollongong. He has previously been a Director at the Minerals Council of Australia and Chairman of the NSW Minerals Council and Port Kembla Coal Terminal.

Chairman of the Board Member of the Audit and Risk Management Committee Member of the Remuneration and Nomination Committee

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Appointed: 10 March 2010

Andrew has been involved in contracting within the mining industry since 1994 and co-founded Mastermyne in 1996.

Andrew was responsible for all aspects of Mastermyne’s operations until the appointment of Tony Caruso as CEO in 2005. Andrew relocated to Sydney in early 2010 to focus on the New South Wales market.

Member of the Audit and Risk Management Committee Member of the Remuneration and Nomination Committee

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Qualifications: Bachelor of Engineering (Mechanical)

Appointed: 15 September 2015 and as Chair of the Remuneration and Nomination Committee on 1 November 2018

Gabe is an executive with over 30 years experience in the steel, mining and stevedoring industry covering operations, maintenance and engineering. Gabe has held senior operational and management roles with Bluescope Steel as General Manager Mills and Coating, Bluescope Steel China as President China Coated and BHP Collieries as General Manager of a number of coal mines.

Gabe's most recent role was General Manager Operations with Patrick Terminals. Gabe has a Bachelor in Mechanical Engineering and is a graduate of the Australian Institute of Company Directors.

Member of the Audit and Risk Management Committee Chair of the Remuneration and Nomination Committee

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Qualifications: Bachelor of Engineering (Mining - First Class Hons), MBA, CA (Distinction) Appointed: 7 June 2018 and Chair of the Audit and Risk Committee on 1 November 2018

Julie brings over 20 years of experience across financial, strategic and operational roles, with a focus throughout her career on the resources sector. Julie is currently GM Strategy and Development for CleanCo, a Government Owned Corporation focused on the development and supply of firmed renewable energy for Queensland customers. Prior to her current role, Julie held various leadership roles including Chief Executive Officer of RDO Australia Group, an industrial and agricultural equipment dealer, and nine years on the executive team of Senex Energy, an Australian oil and gas explorer and developer.

Chair of the Audit and Risk Management Committee Member of the Remuneration and Nomination Committee

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Qualifications: Post Graduate Degree in Business Management Appointed: 10 March 2010

Tony was appointed CEO of Mastermyne in 2005 and Managing Director in 2008 and has overall corporate responsibility for Mastermyne. Tony has over 20 years experience in underground mine contracting services. Prior to joining Mastermyne, Tony was the General Manager of Allied Mining in Queensland and a consultant to the underground mining sector. He has a trade background plus a post graduate degree in Business Management and is a Fellow of the Australian Institute of Management.

Member of the Audit and Risk Management Committee Member of the Remuneration and Nomination Committee

Brett Maff was appointed Company Secretary and Chief Financial Officer on 12 November 2018. Brett has over 20 years experience in senior financial, executive and company secretarial roles in the mining resources and mining services industries. Brett has a Bachelor of Commerce and is a Certified Practicing Accountant.

The numbers of meetings of the Company's board of Directors and of each board committee held during the year ended 30 June 2021, and the numbers of meetings attended by each Director were:



Mr. C Bloomfield Mr. A Watts Mr. G Meena Ms. J Whitcombe Mr. A Caruso	8 8 8 8 7	8 8 8 8 8	4 4 4 4 3	4 4 4 4 4	3 3 3 3 2	3 3 3 3 3

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

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Mastermyne Group Limited (ASX Code: MYE) (“Mastermyne” or “the Company”) is pleased to announce its results for Full Year 2021 which has seen the Company position itself with a very strong outlook while delivering on a number of fronts.

Key highlights of the FY2021 result are:

Excellent Safety Performance with lowest TRIFR result (4.96) since the company formed
Strong investment in developing the capability of people which sets the Company up for the growth ahead
Revenue of $233 million
EBITDA Margin of 9.6% in line with the prior corresponding period and EBITDA of $22.3 million
Strong Profit Result of $5.9 million during a low point in the metallurgical coal price cycle
Declared a 2.25 cent dividend bringing the full year dividend to 3.0 cents representing 56% of Net Profit
Maintained a strong Balance Sheet with a year-end Net Cash position of $19.3 million
Executed the Company’s first Mine Operations Contract with Sojitz Blue at the Crinum Mine totalling $600-$660 million of Revenue over a 6.5 year term
Announced (post year-end) the second Mine Operations Contract with QCoal Group at the Cook Colliery Mine in Central Queensland
An Order Book that lifts to $1.1 billion (from $600 million at half-year)

In a year that faced significant headwinds from low metallurgical coal prices and the temporary suspension of two major underground mines in Queensland, the Company was very pleased to deliver results in line with guidance and more notably to have positioned the business for significant growth in FY2022 and beyond. The addition of two Mine Operations contracts means the Company has a material new revenue stream that provides long term visibility and scale in earnings, gives the Company greater control of its order book and shifts the profile of the Company through its appointment as the coal mine operator. The order book now has a strong weighting of Mine Operations revenue alongside the traditional contracting revenue which combined provides a very strong long-term outlook for the business.

Having achieved a solid financial result and maintained a strong balance sheet with a net cash position supported by a record future order book, the Group has continued its commitment to shareholder returns declaring a final ordinary dividend of 2.25 cents per share (fully franked). This takes the full year dividend to 3.0 cents per share representing 56% of the net profit.

The Company has delivered an outstanding safety performance over the last year with a TRIFR of 4.96, the lowest that the Company has achieved since its inception. This result is the outcome of a very targeted safety approach centred largely around psychological safety supported by strong compliance and behaviour. Mastermyne adopts an equally relentless focus on high potential hazards and learning from zero energy and near miss events. Adopting the principals of a High Reliability Organisation is central to our long-term approach to safety excellence. As the Company shifts to become a Mine Operator, performance like this demonstrates the maturity required across the organisation (people and systems) to safely manage its own operations.

Alongside the relentless investment in the health and safety of its people, there has been the significant investment in developing the Company’s workforce. The internal learning management systems have positioned it with skilled people grown from within the Mastermyne business who are now ready to step up into roles to support the growth ahead. This investment in people de risks the business from the resourcing pressures being experienced across the resources sector and additionally, by growing its own talent, strengthens and protects its culture.

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The internal employee development systems have delivered some very impressive results with 14 coordinators completing Mastermyne Diploma of Project Management, 223 employees completing the MasterMe program, 12 employees (NSW & QLD) completing the Mastermyne Deputy Program, 9 employees completing the Frontline Leadership Course and 29 employees undertaking Cert II Underground Coal Operations with many other employees undergoing professional development and upskilling in addition to these highlights. Having this focus and these results around internal development has created a tangible point of difference for its workforce.

During the year the Company continued its commitment to developing its Hard Rock business with the appointment of key management roles solely focused on the underground hard rock sector. The appointments were experienced and well-respected hard rock executives who brought with them significant technical expertise and a strong network of contacts in the hard rock sector. Through the second half of the year the Company saw the hard rock tender pipeline grow significantly and more than $100 million in hard rock tenders have been submitted. In addition to this organic approach the company continues to explore acquisition opportunities to accelerate entry into the sector.

The Company’s second half results were stronger driven mainly by the strong recovery in coal prices over the latter half of the year and also assisted by the restart of two suspended mines in Central Queensland. The Anglo American Aquila project ramped up to full run rate during the period and the work scope and contract have subsequently been expanded. The earlier investment in the equipment fleet for this project has delivered improved margins and is providing a competitive advantage on the project. The Company was also successful during the period in securing contract extensions at Glencore’s Integra Mine, BMA’s Broadmeadow Mine, Anglo American’s Moranbah North Mine (Chemical installations) and SIMEC’s Tahmoor Mine.

Wilson Mining Services (acquired in 2019) delivered very strong results during the year. This business continues to gain market share and has expanded its product offering through new and improved ground stabilisation products. The Wilson Mining business was a strategic acquisition which broadened the range of services Mastermyne offers to its existing clients with the two businesses having strong synergies sharing similar customers, sites, equipment, workforce and general management. The business provides a nice counter play to the core Mastermyne business and throughout the year has demonstrated this when mines were experiencing major geotechnical issues that had an impact to the Mastermyne operations. The value created through this acquisition has been highly accretive for the overall business and the successful integration of the business into the Mastermyne Group is a strong endorsement of a structured and well run integration plan by the Company.

More recently the Company acquired the remaining 33% shareholding in the Registered Training Organisation (RTO) MyneSight, gaining full control and operation of this business. The MyneSight business provides an in-house training capability to support the resourcing of growth projects including our entry into the underground hard rock sector. The Company has maintained a majority shareholding in this business for several years and saw this opportunity as a low cost mitigation strategy for any future potential resourcing challenges.

The Company has not experienced any significant labour constraints at this point in the cycle but continues to closely monitor developments in the labour market. Strong interest has been received in roles for our Mine Operations contracts with most roles having excess applicants.

Similarly, the Company has not experienced any significant equipment shortages or extended lead times for equipment to resource the upcoming projects. This is largely due to the Company’s counter cyclic acquisition of equipment through the low point in the coal price cycle. Equipment that was acquired and stored in readiness for Mine Operations contracts is now undergoing overhaul in preparation for deployment at the Crinum and Cook projects.

With the commencement of the first Mine Operations project now under way, the Company has invested in expanding the capability of the fleet management team. This has predominately been through the resourcing of additional Asset Management roles that will be responsible for life cycle asset management through an integrated asset management system aligned to ISO 55000.

The Group’s record order book, which is heavily weighted to Metallurgical coal projects (95%+), currently stands at $1.1 billion (excluding Cook which is being finalised) with $246 million to be delivered FY2022, $196 million in FY2023, and $640 million in FY2024 and beyond. In addition to the contracted works, the Company forecasts a further $30-40 million per annum in recurring and purchase order work. The tendering pipeline now stands at $2.3 billion with $0.6 billion in the contracting business, $1.5 billion in the Mine Operations area and $0.2 billion in underground hard rock projects. In addition to the pipeline, the Company also finalised a Mining Services Agreement with Bengal Coal for the Dysart East Project and is currently moving through conditions precedent with work scheduled to start in FY2023 subject to the successful financing of the project. The size and tenure of this project is very similar to the Crinum project.

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The overall cash position at 30 June 2021 represented a net decrease in cash and cash equivalents of $1.0 million against prior period (30 June 2020), to $24.4 million. The decrease was a result of lower operating cashflow generation in proportion to lower revenue and earnings performance, ongoing returns to shareholders through dividends and capital investment in equipment fleet.

The net cash position at the end of the period was $19.3 million after the payment of dividends and capital expenditure through the period.

The cash flow movements were as follows:

net cash inflows from operating activities for the full year ended 30 June 2021 of $18.3 million (full year ended 30 June 2020: inflows of $30.8 million), represented by reduced proportional cashflow generation from revenue and earnings performance and working capital movements across the balance date;
net cash outflows from investing activities for the full year ended 30 June 2021 of $8.3 million (full year ended 30 June 2020: outflows of $12.7 million), predominantly represented by capital investment in existing fleet, and impact of acquisition payments (Wilson Mining Services Pty Ltd FY2020 $3.8 million and acquisition of minority interest in MyneSight Pty Ltd FY2021 $0.4 million); and
net cash outflows from financing activities for the full year ended 30 June 2021 of $11.0 million (full year ended 30 June 2020: outflows of $9.2 million), represented the payment of dividends, and repayment of on-going lease liabilities.

The net assets of the Group have slightly increased from $73.9 million (30 June 2020) to $75.2 million at 30 June 2021.

In addition to a strong Net Cash position the Group maintains significant headroom in its current bank facilities providing additional working capital to support future growth. Mastermyne has an undrawn invoice finance facility limit of $20 million for working capital and an available $10 million for equipment funding.

With the execution of the Crinum Mine Operations contract and the announcement of the Cook Colliery Mine Operations contract the outlook for the Company looks exceptionally strong. In the coming year both the Crinum and Cook projects will be in the ramp up phase delivering revenue of about 50% of the expected long-term annual average. These projects are underpinned by the very stable contracting order book and growth pipeline in the coal and hard rock sectors. As a result, the Company is well positioned to deliver strong earnings growth in FY2022 which will most likely be surpassed in FY2023.

Metallurgical coal prices have recovered substantially from ~$US100/t (December 2020) to ~$US220/t currently. Australia remains one of the lowest cost coal producers in the world, providing high quality metallurgical coal into Asian steel production markets. The demand for Australian seaborne metallurgical coal is expected to remain robust in the medium to long term. Already the Company is seeing scope increases on its existing projects along with an increase in tendering activity which is expected to remain supported through the cycle. Stronger pricing is also evident in key metals with Copper, Nickel and Zinc being particularly robust. Exposure to these and other metals will drive growth and provide stability in cashflows in future periods.

FY2022 will see the Company deliver substantial packages of work to restart the Crinum and Cook mines and the operational focus will be on executing these works on time and on budget. Crinum works are progressing well against schedule and budget and these same project disciplines will be applied to the Cook Colliery re-start. Labour and equipment resourcing strategies are well developed and to date the Company is not experiencing any delays or concerns. The Company has well developed strategies for large scale recruiting and on boarding and is confident it can mitigate any execution risk in the Mine Operations projects. With a strong balance sheet supported by the current undrawn funding facilities, the Company is adequately funded to manage the capital requirements in bringing both the Crinum and Cook projects on line.

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The Directors present the Mastermyne Group Limited 2021 remuneration report, outlining key aspects of our remuneration policy and framework, and remuneration awarded this year.

The information provided in this remuneration report has been audited as required by section 308(3C) of the .

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Key management personnel have the authority and responsibility for planning, directing and controlling the activities of the Company and the Group, including directors of the Company and other executives. Key management personnel comprise the directors and executives of the Company listed below.


(seepage for details about each Director)
Mr. C Bloomfield Mr. A Watts Mr. G Meena Ms. J Whitcombe Mr. A Caruso	Independent Chairman Non-executive Director Non-executive Director Non-executive Director Managing Director & Chief Executive Officer

Mr. D Sykes Ms. V Gayton Mr. P Green Mr. W Price Mr. B Maff Mr. R Bedggood	General Manager Strategy and Growth General Manager Human Resources General Manager Mining QLD General Manager Mining NSW Chief Financial Officer Land development General Manager Hardrock (Appointed 12 January 2021)

Compensation levels for Key Management Personnel (KMP) of the Group are competitively set to attract, retain and motivate appropriately qualified and experienced directors and executives. The Remuneration and Nomination Committee (RNC) obtains independent data on the appropriateness of remuneration packages of the Group given trends in comparative companies and sectors both locally and nationally, and the objectives of the Company's compensation strategy.

The remuneration structures of the Group are designed to attract and reward suitably qualified candidates, reward the achievement of strategic objectives and achieve the broader outcome of creation of value for shareholders. The remuneration structures consist of both a fixed and variable component designed around KPI's aligned with the short and long-term strategic objectives of the Group. Remuneration structures reflect:

the capability and experience of key management personnel;
the key management personnel's ability to control the relevant performance; and
the recognition of the key management personnel's contribution to the Group's performance.

In addition to their salaries, the Group also provides non-cash benefits to its KMP and contributes to a post-employment defined contribution superannuation plan on their behalf. The reviews are conducted under the terms of reference set down for the RNC.

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Fixed remuneration consists of base compensation (which is calculated on total cost basis and includes any fringe benefit tax charges related to employee benefits including motor vehicles), as well as employer contributions to superannuation funds. Executives may receive their fixed remuneration as cash, or cash with non-monetary benefits such as travel allowances.

Fixed remuneration is reviewed annually, or on promotion, by the RNC through a process that considers individual, segment and overall performance of the Group. In addition, external data is provided for analysis of KMP's remuneration to ensure it remains competitive by benchmarking against the market place. The chairman of the RNC sources data independently of management from appropriate independent advisors. For key executive management other than the CEO/Managing Director, the CEO/Managing Director will submit recommendations to the RNC along with relevant supporting data and externally independent comparative information. A senior executive’s compensation may also be reviewed upon promotion or in line with movements in the market place during the period.

In FY2021 fixed remuneration was increased for 5 executives, with an average increase of 4%. This was done to align the remuneration with the level for comparative roles.

Non-executive Directors are not eligible to participate in performance linked remuneration of either a short or long term nature.

Performance linked remuneration includes both short-term and long-term incentives and is designed to reward KMP for meeting or exceeding their financial and personal objectives. The short-term incentive (STI) is an 'at risk' bonus provided in the form of cash.

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The Mastermyne short term incentive plan was introduced as a structured incentive to reward KMP's performance against predetermined KPIs.


Award opportunity	CEO/Managing Director: 75% of fixed remuneration Other executives: 50% of fixed remuneration
Performance metrics	The STI metrics align with our strategic objectives of the Group, with specific financial and non-financial measures (normally 5 or 6) for individual performance, group performance and underlying performance of the Group. A summaryof the measures and weightings are set out in the table below:

	CEO/ManagingDirector	40%	60%
	Other executives	40%	60%
	The financial performance objectives may vary by individual and are broadly based on profitability compared to budgeted amounts approved by the Board each year. The non-financial objectives vary dependent upon position and responsibility and are aligned with the measures and targets set to achieve the strategic objectives of the Group on an annual basis. At the commencement of each performance year, the Board approves the corporate performance scorecard and metrics to be measured for that year. The metrics generally have performance levels set as: • Threshold: Being the minimum level of performance deserving of reward. Achievement of the Threshold results in 50% of the STI Award Opportunity being awarded. • Target: Being a challenging but achievable level of performance. Achievement of the Target results in 100% of the STI Award Opportunity being awarded. • Stretch: Being the upper limit of possible outcomes that were planned for and a very challenging goal that is unlikely to be achieved. Achievement of the Stretch results in 150% of the STI Award Opportunity being awarded. At the end of the financial year, the RNC assess the actual performance of the Group, the relevant segment and individual against the KPI's set at the beginning of the year. Payment of individual bonuses is based on the assessment of the RNC with recommendations from the Managing Director (for employees other than the Managing Director) taking into consideration the overall performance of the individual for the period. The Managing Director's STI bonus is set by the board based on assessment of his/her performance against agreed KPIs as assessed bythe RNC and recommended to the Board.
Delivery of STI	Employees can nominate for up to 50% of their STI award to be settled in shares. When a nomination is made, performance rights are issued to the employee and vest at then end of the year in line with the achievements of their relative KPI's. Any balance not elected to be paid as shares in the Company is paid in cash at the end of the financial year. STIpayments must be self funding.
Board discretion	The Board has discretion to adjust remuneration outcomes up or down to prevent any inappropriate award outcomes,includingreducingdown to zero,if appropriate.

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Executive KMP participate at the Board's discretion, in the Employee Performance Rights Plan comprising annual grants of rights which are subject to various vesting conditions outlined in the table below. The purpose of the Employee Performance Rights Plan is to attract, motivate and retain executives, encouraging individuals to participate in the company through ownership of shares. The objective is to improve Mastermyne's performance by aligning the interests to those of the shareholders and the Group.

Performance Rights issued in 2020 or thereafter have the following structure:


Opportunity/ Allocation	CEO/Managing Director: 75% of fixed remuneration Other executives: 50% of fixed remuneration The opportunityis divided bythe shareprice face value to determine the number of rights.
Performance hurdle	Vesting of the rights will be subject to achievement of the vesting conditions set out below: • Vesting Condition 1: The main Vesting Condition is that the eligible participant must be employed within the Group on the Test Date. If employment has ceased with the Group prior to the Test Date, the performance rights will lapse unless the Board at its absolute discretion determines otherwise. • Vesting Condition 2: Vesting is also conditional on the continuation of good conduct and the execution of duties in the best interests of Mastermyne. If it is deemed the eligible participant has acted fraudulently or dishonestly, or is in breach of obligations to Mastermyne, the Board at its discretion may determine that some or all of the performance rights will lapse. • Vesting Condition 3: If Vesting Conditions 1 and 2 are achieved there are two further Vesting Conditions that will each be applied independently to 50% of the performance rights. These Vesting Conditions depend on Mastermyne’s TSR percentile rank during the TSR measurement period and the Earnings per Share (EPS) performance over the measurement period: (a) Tranche A: 50% of the performance rights will be conditional on the Company’s TSR rank relative to companies in the ASX Peer Group index; and (b) Tranche B: 50% of the performance rights will be conditional on the Company’s EPS performance. For each tranche, the percentage of performance rights which will vest will be as specified in the table below:


	Below 50thpercentile of the ASX Peer Group	0%
	50th percentile to 75th percentile of the ASX Peer Group	50% plus 2% for each percentile above 50thpercentile
	Above 75thpercentile of the ASX Peer Group	100%


	EPSgrowth at <6%	0%
	EPSgrowth between 6% and 12%	0% to 100%pro rata
	EPSgrowth >12%	100%
Exerciseprice	The exerciseprice is$Nil.
Forfeiture and termination	Rights will lapse if performance conditions are not met. Rights will be forfeited on cessation of employment unless the board determines otherwise, e.g. in the case of retirement due to injury, disability,death or redundancy.

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Performance Rights issued before 2020 have the following structure:


Opportunity/ Allocation	CEO/Managing Director: 40% of fixed remuneration Other executives: 20% of fixed remuneration The opportunityis divided bythe shareprice face value to determine the number of rights.
Performance hurdle	Vesting of the rights will be subject to achievement of the vesting conditions set out below: • Vesting Condition 1: The main Vesting Condition is that the eligible participant must be employed within the Group on the Test Date. If employment has ceased with the Group prior to the Test Date, the performance rights will lapse unless the Board at its absolute discretion determines otherwise. • Vesting Condition 2: Vesting is also conditional on the continuation of good conduct and the execution of duties in the best interests of Mastermyne. If it is deemed the eligible participant has acted fraudulently or dishonestly, or is in breach of obligations to Mastermyne, the Board at its discretion may determine that some or all of the performance rights will lapse. • Vesting Condition 3: There is an overriding Vesting Condition, requiring a minimum 8% total shareholder return (TSR) during the TSR measurement period (i.e. from the Time of Grant to the Test Date). • Vesting Condition 4: If Vesting Condition 3 is achieved there are two further Vesting Conditions that will each be applied independently to 50% of the performance rights. Both of these Vesting Conditions depend on Mastermyne’s TSR percentile rank during the TSR measurement period: (a) Tranche A: 50% of the performance rights will be conditional on the Company’s TSR rank relative to companies in the ASX All Ordinaries Accumulation index; and (b) Tranche B: 50% of the performance rights will be conditional on the Company’s TSR rank relative to companies in the ASX 200 Resources Accumulation index. For each tranche, the percentage of performance rights which will vest will be as specified in the table below:


	Below 50th percentile of the ASX Peer Group or the Resources Peer Group	0%	0%
	50th percentile to 75th percentile of the ASX Peer Group or Resources Peer Group	50% plus 2% for each percentile above 50th percentile	50% plus 2% for each percentile above 50thpercentile
	Above 75th percentile of the ASX Peer Group or the Resources Peer Group	100%	100%
Exerciseprice	The exerciseprice is$Nil.
Forfeiture and termination	Rights will lapse if performance conditions are not met. Rights will be forfeited on cessation of employment unless the board determines otherwise, e.g. in the case of retirement due to injury, disability,death or redundancy.

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Key Management Personnel can receive additional benefits as non-cash benefits as part of the terms and conditions of their appointment. Non-cash benefits typically include motor vehicle benefits, and the Group pays fringe benefits tax on these benefits.

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Performance linked remuneration includes both short-term and long-term incentives and is designed to reward KMP for meeting or exceeding their financial and personal objectives.

The Group’s performance in 2021 remained strong during a low point in the metallurgical coal price cycle, with a solid profit result achieved, and healthy balance sheet position, while continuing to focus on keeping our people safe and recording its best safety result in the Company's history. For more information on 2021 results, see page 3 of the operating and financial review.

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We aim to align our executive remuneration to our strategic and business objectives and the creation of shareholder wealth. The table below shows measures of the Group's financial performance over the last five years as required by the . However, these are not necessarily consistent with the measures used in determining variable amounts of remuneration to be awarded to KMPs. As a consequence, there may not always be a direct correlation between statutory key performance measures and the variable remuneration.

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Profit for the year attributable to owners of Mastermyne
($'000)	5,864	11,557	10,348	5,435	(2,012)
Dividends payments ($'000)	5,057	6,346	-	-	-
Increase/(decrease) in share price (%)	23.0	(37.0)	(14.0)	+248.0	+182.0
Return on capital employed from continuing operations (%)	13.0	24.0	18.0	17.0	(6.0)

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The RNC recommends Group remuneration policies for Key Management Personnel. The RNC focuses mainly on the CEO's remuneration but reviews agreements made with other KMP. In recommending the CEO remuneration package, the RNC takes advice from independent advisors in executive and non-executive remuneration as noted below.


Fixed remuneration	$438,343 (i)	Range between $264,680 and$358,963(i)
Contract duration	Ongoingcontract	Ongoingcontract
Notice bythe individual/company	9 months	3 months
Termination of employment (without cause)	Entitlement to pro-rata STI for the year Unvested LTI will remain on foot subject to achievement of the performance hurdles at the original date of testing The Board has discretion to award a greater or lower amount
Termination of employment(with cause)or bythe individual	STI is not awarded,and all unvested LTI will lapse

(i) The actual remuneration paid to KMP during the year will vary from the contracted amounts depending on the number of payroll weeks in the financial year.

Different contractual terms apply to the following individuals:

P Green is employed as a contractor through a consulting company. As a contractor he does not receive superannuation benefits and he is not entitled to STI's or LTI's. The current contract in place expired on 30 June 2021. A new contract is currently under negotiation. Both parties to the Professional Service Agreement acknowledge the terms of the original contract remain ongoing during this period, until the variations, including new term, are agreed in writing.
R Bedggood is employed as a contractor through a consulting company. As a contractor he does not receive superannuation benefits and his not entitled to STI's or LTI's. The current contract in place expires on 10 January 2022.

The following tables show details of the remuneration expense recognised for the Group's executive key management personnel for the current and previous financial year measured in accordance with the requirements of the accounting standards.

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	Short-term employee benefits			Post- employment benefits	Long- term benefits	Share based payments
	Cash salary and fees $	Cash bonus $	Non- monetary benefits $	Super- annuation $	Employee entitlements $	Rights $	Termination benefits $	Total $	Performance related
Mr. A Caruso Mr. D Sykes Ms. V Gayton Mr. P Green Mr. W Price Mr. B Maff Mr. R Bedggood	500,209 363,528 262,044 363,000 299,660 367,793 164,103	353,414 15,000 75,884 27,908 126,481 - 1,098,896 43.67% 183,571 - 50,375 9,866 59,100 - 666,440 36.41% 132,340 - 37,923 7,623 43,397 - 483,327 36.36% - - - - - - 363,000 -% 97,622 - 40,740 - 52,252 - 490,274 30.57% 142,862 - 21,694 - 108,918 - 641,267 39.26% - - - - - - 164,103 -%

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R Bedggood was appointed as Executive General Manager Hardrock on 12 January 2021.
The fair value of the rights is calculated at the date of grant using a Monte Carlo pricing model and allocated to each reporting period evenly over the period from grant date to vesting date. The value disclosed is the portion of the fair value of the rights recognised in this reporting period.

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2020	Short-term employee benefits			Post- employment benefits	Long- term benefits	Share based payments
	Cash salary and fees $	Cash bonus $	Non- monetary benefits $	Super- annuation $	Employee entitlements $	Rights $	Termination benefits $	Total $	Performance related
Mr. A Caruso Mr. D Sykes Ms. V Gayton Mr. P McCoy Mr. P Green Mr. W Price Mr. B Maff	376,108 138,379 15,000 336,981 62,818 - 254,808 63,000 - 177,387 - 19,500 74,250 - - 312,891 76,747 - 328,702 97,113 -			47,584 34,513 109,231 - 720,815 34.35% 36,689 24,343 47,401 - 508,232 21.69% 29,675 33,047 32,197 - 412,727 23.07% 16,797 (24,378) - - 189,306 -% - - - - 74,250 -% 37,015 19,969 24,319 - 470,941 21.46% 21,404 22,043 10,241 - 479,503 22.39%

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P McCoy transferred to a non-KMP role on 30 March 2020.
P Green was appointed as Executive General Manager QLD Mining on 30 March 2020.

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The fair value of the rights is calculated at the date of grant using a Monte Carlo pricing model and allocated to each reporting period evenly over the period from grant date to vesting date. The value disclosed is the portion of the fair value of the rights recognised in this reporting period.

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The table below shows for each KMP how much of their STI cash bonus was awarded and how much was forfeited. It also shows the value of rights that were granted and exercised during FY 2021. The number of rights and percentages vested/forfeited for each grant date are disclosed in Section (h) Equity instruments on pages 16 to 18.




Mr. A Caruso Mr. D Sykes Ms. V Gayton Mr. P Green Mr. W Price Mr. B Maff Mr. R Bedggood	328,757 108 - 206,019 194,148 174,830 105 - 109,559 85,226 132,340 100 - 82,932 54,701 - - - - - 325,407 60 40 101,960 - 176,482 108 - 178,100 - - - - - -

The value at grant date calculated in accordance with AASB 2 of options granted during the year as part of remuneration.

** The value at the exercise date of options that were granted as part of remuneration and were exercised during the year has been determined as the intrinsic value of the options at that date.

In the current year the RNC was presented with a report comparing KMP salaries across industry peers. The data was sourced from publicly available sources. No specific recommendations were sought on director or KMP remuneration due to the Board's view that market circumstances were too fluid to allow historical information to provide a useful guide to appropriate remuneration levels.

$7,500 in external fees were paid for remuneration research reports during the 2021 financial year.

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Non-executive Directors receive a board fee and fees for chairing or participating on board committees, see table below. They do not receive performance-based pay or retirement allowances. The fees are inclusive of superannuation. The chairman does not receive additional fees for participating in or chairing committees.

Fees are reviewed annually by the board taking into account comparable roles and market data provided by the board’s independent remuneration adviser.


Chair		109,500
Other non-executive directors		65,700

Audit	Chair Member	5,475
		-
Remuneration and nomination	Chair Member	5,475
		-

All non-executive directors enter into a service agreement with the Company in the form of a letter of appointment. The letter summarises the board policies and terms, including remuneration, relevant to the office of Director.

The actual remuneration paid to Non-executive Directors during the year will vary from the contracted amounts depending on the number of payroll weeks in the financial year.

The following table shows details of the remuneration expense recognised for the Group's non-executive directors for the current and previous financial year measured in accordance with the requirements of the accounting standards.

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	Short-term employee benefits			Post- employment benefits
	Board fees $	Audit committee fees $	Remuneration and nomination committee fees $	Super- annuation $	Total $
Mr. C Bloomfield Mr. A Watts Mr. G Meena Ms. J Whitcombe	100,000 60,000 60,000 60,000	- - - - - 5,000 5,000 -		9,509 109,509 5,706 65,706 6,181 71,181 6,181 71,181


2020	Short-term employee benefits			Post- employment benefits
	Board fees $	Audit committee fees $	Remuneration and nomination committee fees $	Super- annuation $	Total $
Mr. C Bloomfield Mr. A Watts Mr. G Meena Ms. J Whitcombe	82,923 - - 7,878 90,801 46,154 - - 4,385 50,539 46,154 - 5,096 4,869 56,119 46,154 5,096 - 4,869 56,119

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The terms and conditions of each grant of rights affecting remuneration in the current or a future reporting period are as follows:


				Tranche A
24/11/2020	1/10/2023	1/10/2023	-	0.4945	To be determined	-
21/11/2019	1/10/2022	1/10/2022	-	0.7415	To be determined	-
21/11/2018	1/10/2021	1/10/2021	-	0.8077	To be determined	-
21/11/2017	1/10/2020	1/10/2020	-	0.5225	>75th percentile	100
				Tranche B
24/11/2020	1/10/2023	1/10/2023	-	0.4784	To be determined	-
21/11/2019	1/10/2022	1/10/2022	-	0.7100	To be determined	-
21/11/2018	1/10/2021	1/10/2021	-	0.7727	To be determined	-
21/11/2017	1/10/2020	1/10/2020	-	0.4695	71st percentile	94
			Granted in relation to STI
22/1/2021	1/10/2021	1/10/2021	-	0.7030	To be determined	-

The number of performance rights provided as remuneration to key management personnel is shown in the table below. All rights refer to rights to acquire one ordinary share of Mastermyne Group Limited for no consideration which upon exercise are exchangeable on a one for one basis.

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The following table shows a reconciliation of rights held by each KMP from the beginning through to the end of FY2021. There were no vested rights as at 1 July 2020.

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Tranche A
Mr. A Caruso 24/11/2020 - 211,758 Mr. A Caruso 21/11/2019 73,947 - Mr. A Caruso 21/11/2018 58,980 - Mr. A Caruso 21/11/2017 128,369 -				- - - - - - 211,758 - - - - - - 73,947 - - - - - - 58,980 128,369 100 (128,369) - - - -
Mr. D Sykes 24/11/2020 - 112,611 Mr. D Sykes 21/11/2019 31,924 - Mr. D Sykes 21/11/2018 25,168 - Mr. D Sykes 21/11/2017 56,351 -				- - - - - - 112,611 - - - - - - 31,924 - - - - - - 25,168 56,351 100 (56,351) - - - -
Ms. V Gayton 24/11/2020 - 85,243 Ms. V Gayton 21/11/2019 24,181 - Ms. V Gayton 21/11/2018 17,591 - Ms. V Gayton 21/11/2017 36,168 -				- - - - - - 85,243 - - - - - - 24,181 - - - - - - 17,591 36,168 100 (36,168) - - - -
Mr. W Price 24/11/2020 - 104,800 Mr. W Price 21/11/2019 31,411 - Mr. W Price 21/11/2018 24,818 -				- - - - - - 104,800 - - - - - - 31,411 - - - - - - 24,818
Mr. B Maff 24/11/2020 111,754 Mr. B Maff 21/11/2019 30,398 -				- - - - - - 111,754 - - - - - - 30,398
Tranche B
Mr. A Caruso 24/11/2020 - 211,758 Mr. A Caruso 21/11/2019 73,947 Mr. A Caruso 21/11/2018 58,980 - Mr. A Caruso 21/11/2017 128,369 -				- - - - - - 211,758 - - - - - 73,947 - - - - - - 58,980 120,357 94 (120,357) (8,012) 6 - -
Mr. D Sykes 24/11/2020 - 112,611 Mr. D Sykes 21/11/2019 31,294 - Mr. D Sykes 21/11/2018 25,168 - Mr. D Sykes 21/11/2017 56,351 -				- - - - - - 112,611 - - - - - 31,294 - - - - - - 25,168 52,834 94 (52,834) (3,517) 6 - -
Ms. V Gayton 24/11/2020 - 85,243 Ms. V Gayton 21/11/2019 24,181 Ms. V Gayton 21/11/2018 17,591 - Ms. V Gayton 21/11/2017 36,168 -				- - - - - - 85,243 - - - - - 24,181 - - - - - - 17,591 33,910 94 (33,910) (2,258) 6 - -
Mr. W Price 24/11/2020 104,800 Mr. W Price 21/11/2019 31,411 - Mr. W Price 21/11/2018 24,818 -				- - - - - - 104,800 - - - - - - 31,411 - - - - - - 24,818
Mr. B Maff 24/11/2020 111,754 Mr. B Maff 21/11/2019 30,398 -				- - - - - - 111,754 - - - - - - 30,398
Granted aspart of STI
Mr. B Maff 24/11/2020 - 98,684				- - - - - - 98,684

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The movements during the reporting period in the number of ordinary shares in Mastermyne Group Limited held directly, indirectly or beneficially by each key management person including their related parties, is as follows:

Mr. C Bloomfield	1,100,000	-	17,629	1,117,629
Mr. A Watts	12,262,245	-	-	12,262,245
Mr. G Meena	100,000	-	-	100,000
Ms. J Whitcombe	94,000	-	-	94,000
Mr. A Caruso	2,132,979	248,726	9,850	2,391,555
Mr. D Sykes	175,626	109,185	-	284,811
Ms. V Gayton	89,200	70,078	-	159,278
Mr. B Maff	89,024	-	-	89,024
Mr. W Price	-	-	11,173	11,173

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Apart from the details disclosed in this note, no director has entered into a material contract with the Group since the end of the previous financial year and there were no material contracts involving directors' interests existing at year-end.

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No loans were made, guaranteed or secured by the Company to key management personnel during the year.

A number of key management persons, or their related parties, hold positions in other entities that result in them having control or significant influence over the financial or operating policies of those entities.

A number of these entities transaction with the Group in the reporting period. The terms and conditions of the transaction with key management persons and their related parties were no more favourable then those available, or which might reasonably be expected to be available, on similar transactions to non-key management persons related entities on an arm's length basis. These include the following:

The Group rents the premises at 45 River Street, Mackay which is owned by Andrew Watts through his company, Watty Pty Ltd. Amounts paid for rent are at arm's length and are due and payable under normal payment terms.
The Group rents the premises at 56A Grosvenor Drive, Moranbah which is owned by Andrew Watts through his company, Watty Pty Ltd. Amounts paid for rent are at arm's length and are due and payable under normal payment terms.
The Group paid Treatwater & Plumbing Pty Ltd, which is owned by Anthony Caruso, fees for general plumbing services during the year. Fees paid are at arm's length and due and payable under normal payments terms.

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Aggregate amounts of each of the above types of other transactions with key management personnel of Mastermyne Group Limited:

Group Limited:
Rent of 45 River Street Rent of 56A Grosvenor Drive General plumbing repairs	2020 $ 189,739 23,464 116
	213,319

From time to time key management personnel and directors of the Group, or their related entities, may purchase goods or services from the Group. These purchases are on the same terms and conditions as those entered into by other Group employees or customers and are trivial or domestic in nature.

At the end of the reporting period there were no amounts recognised as assets or liabilities in relation to the above transactions.

This concludes the remuneration report, which has been audited.

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The principal activities of the Group during the financial year were to provide underground contracting services and industrial products and services in the coalfields and supporting industries of Queensland and New South Wales.

During the financial year the Group acquired the remaining 33% of the issued shares of MyneSight Pty Ltd making it a wholly-owned subsidiary.

In addition, the Group was awarded their first Mine Operations contract.

Other than these items, there were no other significant changes in the state of affairs.

The Group is subject to various environmental regulations under both Commonwealth and State legislation in relation to its involvement in the operations of mines.

The Board believes that the Group has adequate systems in place for the management of its environmental requirements and is not aware of any breach of those environmental requirements as they apply to the Group.

Dividends paid to members during the financial year were as follows:

Dividends paid to members during the financial year were as follows:
Final dividend for the year ended 30 June 2020 of 4 cents (2019 - 2 cents) per fully paid share No Special Dividend was paid for the year ended 30 June 2020 (2019 - 2 cents) per fully paid share Interim dividend for the year ended 30 June 2021 of 0.75 cents (2020 - 2 cents) per fully paid share In addition to the above dividends, since year end the Directors have recommended the payment of a final dividend of 2.25 cents per fully paid ordinary share (2020 - 4 cents).	2020 $'000 2,110 2,110 2,126
	6,346
	- 2020 $'000 4,252

On 28 July 2021, 1,106,600 shares were issued to the Vendors of Wilson Mining Services Pty Ltd in settlement of the outstanding purchase consideration for the prior year business combination discussed in Note 21. An additional 100,394 shares were issued as compensation for the dividends paid while the shares remained unissued.

Other than the matter discussed above and the dividend declared subsequent to balance date as disclosed in the previous section, no matter or circumstance has arisen since 30 June 2021 that has significantly affected the Group's operations, results or state of affairs, or may do so in future years.

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Despite the impacts of global COVID restrictions the outlook for metallurgical coal continues to be supported by strong fundamentals. The demand for Australian seaborne metallurgical coal is expected to remain robust in the medium to long term. The COVID restrictions globally have weighed on short term coal pricing, but metallurgical and thermal coal pricing have recovered substantially over the last 6 months. The Sector continues to utilise contracting companies for their operational needs in order to maintain flexible operations and cost control with their organisations. The Company has progressed its first whole of mine project and is progressing with several further opportunities with the potential to provide a material and resilient additional revenue stream for the Company.

Further information about likely developments in the operations of the Group and the expected results of those operations in future financial years has not been included in this report because disclosure of the information would be likely to result in unreasonable prejudice to the Group.

The relevant interest of each Director in the shares, debentures, interests in registered schemes and rights or options over such instruments issued by the companies within the Group, as notified by the Directors to the Australian Securities Exchange in accordance with S205G(1) of the Corporations Act 2001, at the date of this report is as follows:



Colin Bloomfield Gabe Meena Julie Whitcombe Andrew Watts Tony Caruso	1,100,000 100,000 94,000 12,262,245 2,132,979	- - - - 522,592

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At the date of this report there were no unissued ordinary shares of the Company under option.

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The Company has agreed to indemnify the following current Directors of the Company, Colin Bloomfield, Tony Caruso, Andrew Watts, Gabe Meena and Julie Whitcombe for all liabilities to another person (other than the Company or a related body corporate) that may arise from their position within the Company and its controlled entities, except where liability arises out of conduct involving a lack of good faith. The agreement stipulates that the Company will meet the full amount of any such liabilities including costs and expenses.

The Company has not made a relevant agreement, or indemnified against a liability, for any person who is or has been an auditor of the Company.

During the financial year, the entity has paid premiums on behalf of the Company in respect of Directors' and Officers' liability and legal expenses insurance contracts for the year ended 30 June 2021 and, since the end of the financial year, the entity has paid or agreed to pay on behalf of the Company, premiums in respect of such insurance contracts for the year ended 30 June 2022. Such insurance contracts insure against certain liability (subject to specific exclusions) persons who are or have been Directors or executive officers of the Company.

The Directors have not included details of the nature of the liabilities covered or the amount of the premiums paid in respect of the Directors' and Officers’ liability and legal expenses insurance contracts, as such disclosure is prohibited under the terms of the contracts.

During the year, Pitcher Partners, the Company's auditor, has performed certain other services in addition to their statutory duties.

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The board of Directors has considered the non-audit services provided during the year by the auditor and, in accordance with written advice provided by resolution of the Audit & Risk Committee, is satisfied that the provision of those non-audit services during the year by the auditor is compatible with, and did not compromise, the auditor independence requirements of the 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; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110

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Details of the amounts paid or payable to the auditor of the Company, Pitcher Partners, and its related practices for audit and non-audit services provided during the year are set out below.

Details of the amounts paid or payable to the auditor of the Company, Pitcher Partners, and and non-audit services provided during the year are set out below.	its related practices for audit
Pitcher Partners Audit and review of financial statements Pitcher Partners Tax compliance services	2020 $ 110,000
	110,000
	-
	-

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No person has applied to the Court under section 237 of the 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 Group for all or part of those proceedings. The Group was not a part to any such proceedings during the year.

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The Lead auditor’s independence declaration is set out on page 22 and forms part of the Directors' report for the financial year ended 30 June 2021.

The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of amounts in the financial report and directors' report. Amounts in the financial report and the directors' report have been rounded off in accordance with the instrument to the nearest thousand dollars, unless otherwise stated.

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

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Mr. C Bloomfield Director

Brisbane 17/08/2021

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Level 38, 345 Queen Street Brisbane, QLD 4000

Postal address GPO Box 1144 Brisbane, QLD 4001

p. +61 7 3222 8444

Auditor’s Independence Declaration

In relation to the independent audit for the year ended 30 June 2021, to the best of my knowledge and belief there have been:

(i) No contraventions of the auditor independence requirements of the Corporations Act 2001 and
(ii) No contraventions of APES 110 Code of Ethics for Professional Accountants (including Independence Standards).

This declaration is in respect of Mastermyne Group Limited and the entities it controlled during the year.

PITCHER PARTNERS

J. J. EVANS

Partner

Brisbane, Queensland 17 August 2021

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Brisbane Sydney Newcastle Melbourne Adelaide Perth

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pitcher.com.au

Pitcher Partners is an association of independent firms. An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities.

NIGEL FISCHER PETER CAMENZULI KYLIE LAMPRECHT BRETT HEADRICK COLE WILKINSON JEREMY JONES JAMES FIELD ROBYN COOPER CHERYL MASON MURRAY GRAHAM MARK NICHOLSON JASON EVANS NORMAN THURECHT WARWICK FACE SIMON CHUN TOM SPLATT DANIEL COLWELL FELICITY CRIMSTON KIERAN WALLIS ANDREW ROBIN

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		2020
	Notes	$'000
Revenue from contracts with customers	3	292,670
Other income	4	1,345
Contract disbursements		(37,305)
Personnel expenses	5	(220,030)
Office expenses		(6,495)
Depreciation and amortisation expense	5	(11,086)
Other expenses	5	(1,563)
		17,536
Finance income		44
Finance expenses		(798)
	6	(754)
Profit before income tax		16,782
Income tax expense	7	(5,122)
Total comprehensive income for the period		11,660
Profit is attributable to:
Owners of Mastermyne Group Limited		11,557
Non-controlling interests		103
		11,660
Total comprehensive income for the period is attributable to:
Owners of Mastermyne Group Limited		11,557
Non-controlling interests		103
		11,660
		Cents
Basic earnings per share	17	11.0
Diluted earnings per share	17	10.9

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		2020
	Notes	$'000
Cash and cash equivalents	8	25,359
Trade and other receivables	9	49,092
Contract assets	3(b)	-
Inventories	10	6,262
		80,713
Property, plant and equipment	11	22,421
Right-of-use assets	15	14,462
Intangible assets	12	12,221
Deferred tax assets	7(d)	7,879
		56,983
		137,696
Trade and other payables	13	34,136
Contract liabilities	3(b)	-
Lease liabilities	15	4,918
Current tax liabilities	7(c)	1,593
Employee benefit obligations	14	9,987
Other current liabilities	16	-
		50,634
Lease liabilities	15	9,124
Employee benefit obligations	14	169
Other non-current liabilities	16	3,855
		13,148
		63,782
		73,914
Share capital	19	61,003
Other equity	19	4,033
Other reserves	19	(23,859)
Retained earnings		32,212
Equity attributable to owners of Mastermyne Group Limited		73,389
Non-controlling interests		525
		73,914

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Notes Profit for the period Other comprehensive income Issue of ordinary shares as consideration for Wilson Mining acquisition Payment of Dividends 18 Share-based payment transactions Share options exercised Shares issued or to be issued on dividends reinvested Total contributions by and distributions to owners Profit for the period Other comprehensive income Issue of ordinary shares as consideration for Wilson Mining acquisition 21 Transactions with non-controlling interests 22 Payment of Dividends 18 Distribution to non-controlling interest 18 Share-based payment transactions Share options exercised Shares issued or to be issued on dividends reinvested Total contributions by and distributions to owners	61,003 26,878 - 277 (24,237) 63,921 422 64,343
	- 11,557 - - - 11,557 103 11,660 - - - - - - - -

	- - 3,799 - - 3,799 - 3,799 - (6,346) - - - (6,346) - (6,346) - - - 224 - 224 - 224 - 123 - (123) - - - - - - 234 - - 234 - 234
	- (6,223) 4,033 101 - (2,089) - (2,089)


	61,003 32,212 4,033 378 (24,237) 73,389 525 73,914
	- 5,864 - - - 5,864 11 5,875 - - - - - - - -

	2,779 156 (2,935) - - - - - - (23) - - - (23) (354) (377) - (5,057) - - - (5,057) - (5,057) - - - - - - (182) (182) - - - 441 - 441 - 441 - 221 - (221) - - - - 513 - 55 - - 568 - 568
	3,292 (4,703) (2,880) 220 - (4,071) (536) (4,607)

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		2020
	Notes	$'000
Receipts from customers (inclusive of GST)		315,613
Payments to suppliers and employees (inclusive of GST)		(278,557)
		37,056
Interest received		44
Interest paid		(798)
Income taxes paid		(5,471)
Receipts of government grants and subsidies		-
	8	30,831
Payment for acquisition of subsidiary, net of cash acquired		(3,799)
Payments for property, plant and equipment		(8,285)
Initial direct costs on right-of-use assets		(485)
Payment of software development costs		(281)
Proceeds from sale of property, plant and equipment		129
Payment for purchase of non-controlling interest		-
		(12,721)
Principal elements of finance lease payments		(3,062)
Dividends paid to company's shareholders	18	(6,112)
Dividends paid to non-controlling interests in subsidiaries		-
		(9,174)
		8,936
Cash and cash equivalents at the beginning of the financial year		16,423
Cash and cash equivalents at end of year	8	25,359

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The financial statements are for the Group consisting of Mastermyne Group Limited ('the Company') and its controlled entities (together referred to as the 'Group' and individually as 'Group entities'). The principal accounting policies adopted in the preparation of this annual report are set out in the following notes to the financial statements. These policies have been applied consistently to all periods presented in these consolidated financial statements, and have been applied consistently by the Group entities.

These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board and the . These financial statements are presented in Australian dollars, which is the Company's functional currency and the functional currency of each entity in the Group. These financial statements have been prepared under the historical cost convention. Mastermyne Group Limited is a for-profit entity for the purpose of preparing the financial statements. The Group is primarily involved in providing contracting services to the underground long wall mining operations and industrial products and services in the coalfields and supporting industries of Queensland and New South Wales.

The consolidated financial statements of the Mastermyne Group Limited Group also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

The Group has adopted all of the new and revised accounting standards and interpretations issued by the Australian Accounting Standards Board that are relevant to our operations and effective for an annual reporting period commencing 1 July 2020.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

The following Accounting Standards and Interpretations are most relevant to the consolidated entity:

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The consolidated entity has adopted the revised Conceptual Framework from 1 July 2020. The Conceptual Framework contains new definition and recognition criteria as well as new guidance on measurement that affects several Accounting Standards, but it has not had a material impact on the consolidated entity's financial statements.

The preparation of the financial statements requires the use of certain critical accounting estimates which, by definition, will seldom equal the actual result. Management also needs to exercise judgement in applying the Group's accounting policies. The areas involving significant estimates, assumptions or judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are:

Note 7(d): Recognition of deferred tax asset for carried-forward tax losses;
Note 12: Key assumptions used in value-in-use calculations;
Note 15: Determining the lease term;
Note 15: Determining the incremental borrowing rate;
Note 16: Contingent consideration; and
Note 25: Measurement of share-based payments.

Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.

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Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the consolidated balance sheet.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.

The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of amounts in the financial statements. Amounts in the financial statements have been rounded off in accordance with the instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.

The financial statements were authorised for issue by the Directors on 17/08/2021. The Directors have the power to amend and reissue the financial statements.

Mastermyne Group Limited is a Company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Riverside Plaza 45 River Street Mackay QLD 4740

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An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group's other components.

The Group’s operating segments are based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers (‘CODM’) in assessing performance and in determining the allocation of resources.

During the current reporting period, the Directors reassessed the reportable segments and are of the opinion that all operating segments meet the criteria for aggregation into a single reportable segment as the CODM reviews results, assesses performance and allocate resources at a Group level, and the operating segments have similar economic characteristics and customers.

As the information reported to the CODM is the consolidated results of the Group, the segment results for the year ended 30 June 2020 and 30 June 2021 are shown throughout these financial statements and are not duplicated here.

For information regarding major customers, refer to Note 20(b). The Group operates in one geographical segment, namely Australia.

For information regarding product and service sales, refer to Note 3 Revenue from contracts with customers.

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The Group derives revenue from contracts with customers from the transfer of goods and services over time and at a point in time as follows:

Contracting revenue Sale of goods Machinery hire	2020 $'000 271,233 5,498 15,939
	292,670

2020 $'000 - Current contract assets relating to mine operation contracts Total contract assets - - Contract liability - income received in advance

Mastermyne Group Limited was awarded their first mine operation contract in May 2021. The contract asset at the end of the year represents capitalised costs to fulfil a contract.

The following table shows unsatisfied performance obligations resulting from fixed-price long-term Whole-of-Mine contracts:

2020 $'000 Aggregate amount of the contract price allocated to long-term mine operation contracts - that are partially or fully unsatisfied as at 30 June

The remaining contract price will be recognised over time over the remaining term of the underlying contract using the input or output method depending on the type of goods or services and relevant performance obligation.

The company derives revenue from contracting, sale of goods and machinery hire. Revenue is recognised as, or when, goods or services are transferred to the customer, and is measured at an amount that reflects the consideration to which the company expects to be entitled in exchange for the goods or services.

The consideration to be received from customers may include fixed amounts, variable amounts, or both. Where the contract includes a right to variable consideration, the Group estimates the amount of variable consideration using the most likely amount approach on a contract-by-contract basis. Variable consideration is included in the measurement of revenue only to the extent that it is highly probable, based on historical experience, that a significant reversal of the cumulative amount recognised will not occur when the uncertainty associated with the variability is subsequently resolved.

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Revenue is recognised for the major business activities as follows:

Contracting revenue includes new mine development, mine operation and all mine support services such as training, roadway construction, ventilation, conveyors, longwall relocations and application of polymeric strata support. Contracting revenue is recognised over time, and dependent on the type of contract, is measured using either the input or output method.

For schedule of rates contracts, where a rate is prescribed for each of the activities performed, revenue is recognised in the amount to which Mastermyne Group Limited has a right to invoice.

For fixed-price contracts, either the input or output method is used to recognise revenue depending the terms of the underlying contract. Where the output method is determined to be most appropriate, revenue is recognised on the basis of direct measurement of the value of goods or services transferred to the customer. Where the input method is determined to be most appropriate, revenue is recognised on the basis of resources consumed, costs incurred or machines hours. When the entity's performance does not create an asset with an alternative use to the entity, and the entity has an enforceable right to payment for performance completed to date, revenue is recognised over-time by reference to the stage of completion of the contract activity and measurement is based on the proportion of contract costs incurred up to the end of the reporting period relative to the estimated total contract costs.

Contracts can contain multiple performance obligations. Where the contracts include multiple performance obligations, the transaction price will be allocated to each performance obligation based on the stand-alone selling prices. Where these are not directly observable, they are estimated based on expected cost plus margin.

Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change. Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management.

In the case of fixed-price contracts, the customer pays the fixed amount based on a production schedule. If the services rendered by Mastermyne Group Limited exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contract liability is recognised.

Revenue from the sale of goods is recognised at a point in time when the Company transfers control of goods to a customer for the amount to which the Company expects to be entitled.

Machinery hire revenue is recognised over time using the input method.

A receivable from a contract with a customer represents the company’s unconditional right to consideration arising from the transfer of goods or services to the customer (i.e., only the passage of time is required before payment of the consideration is due). Subsequent to initial recognition, receivables from contracts with customers are measured at amortised cost and are tested for impairment. Receivables from contracts with customers include trade and other receivables and unbilled revenue at year end.

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Administration Income Contractual settlement Government grants and subsidies	2020 $'000 795 550 -
	1,345

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Government grants relating to costs are deferred and recognised in profit or loss over the period necessary to match them with the costs that they are intended to compensate.

		2020
	Notes	$'000
Wages and salaries		191,670
Other associated personnel expenses		16,129
Contributions to defined contribution superannuation funds		12,007
Equity-settled share based payment transactions		224
		220,030
Depreciation	11, 15	10,794
Amortisation	12	292
		11,086
Business development costs		122
Insurance		1,375
Impairment losses arising from contracts with customers		-
Loss on sale of property, plant and equipment		66
Royalty expense		-
		1,563

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Interest income from financial instruments measured using the effective interest method Interest and finance charges paid/payable for lease liabilities and financial liabilities not at fair value through profit or loss	2020 $'000 (44)
	(44) 798
	798
	754

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Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial assets except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).

Interest income is presented as finance income where it is earned from financial assets that are held for cash management purposes. Any other interest income is included in other income.

Finance expenses comprise interest expense on borrowings, interest in respect of lease liabilities and unwinding of the discount on provisions. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss using the effective interest method.

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The major components of income tax expense follow:

The major components of income tax expense follow:
Current income tax expense Adjustment for prior period Deferred income tax relating to the origination and reversal of temporary differences	2020 $'000 4,818 (47)
	4,771 351
	5,122

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A reconciliation between income tax expense and the product of accounting profit before income tax multiplied by the Company's applicable income tax rate is as follows:

Company's applicable income tax rate is as follows:
Profit from operations before income tax expense Tax at the Australian tax rate of 30.0% (2020 - 30.0%) Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Other non-deductible expenses Under/(over) provision of previous year Income tax expense	2020 $'000 16,782 5,035 134
	5,169 (47)
	5,122
	(21,904)

The current tax liability for the Group of $1,039,000 (2020: $1,593,000) represents the amount of income taxes payable, in respect of current and prior periods.

Deferred income tax assets and liabilities are attributable to the following temporary differences:

Tax losses Employee benefits Accruals Capital raising and business acquisition costs Lease liabilities Property, Plant and Equipment Total deferred tax assets Property, Plant and Equipment Receivables Intangible Assets Right-of-use assets Unbilled Revenue Total deferred tax liabilities Net deferred tax assets	2020 $'000 6,289 3,097 385 44 3,040 251
	13,106
	- (87) (468) (2,997) (1,675)
	(5,227)
	7,879

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Movements in deferred tax assets and liabilities are as follows:

(Charged)/credited - to profit or loss - to current tax liability Acquisition of subsidiary (Charged)/credited - to profit or loss - to current tax liability	7,065 2,568 332 62 - (44) (100) (10) - - (1,747) 8,126 (1,308) 92 53 (22) 3,040 493 13 49 (2,997) 148 88 (351) 11 - - 4 - - - - - - - 15 521 437 - - - (198) - (507) - (148) (16) 89
	6,289 3,097 385 44 3,040 251 (87) (468) (2,997) - (1,675) 7,879
	6,289 3,097 385 44 3,040 251 (87) (468) (2,997) - (1,675) 7,879 (549) 540 104 (21) (751) (381) 99 73 776 - (181) (291) (53) - - - - 3 (12) - - - - (62)
	5,687 3,637 489 23 2,289 (127) - (395) (2,221) - (1,856) 7,526

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The income tax expense or credit for the period is the tax payable on the current period's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company and its subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Mastermyne Group Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation legislation. As a consequence, these entities are taxed as a single entity and the deferred tax assets and liabilities of these entities are set off in the consolidated financial statements.

The deferred tax assets include an amount of $5,687,000, which relate to revenue losses totalling $18,956,000 (2020: $20,964,000) which are available to be offset against future taxable income. These losses arose within Diversified Mining Services Pty Ltd and Wilson Mining Services Pty Ltd prior to the acquisition by the Group. The Group has concluded that the deferred assets will be recoverable using the estimated future taxable income based on the approved business plans and budgets for the Group. The losses can be carried forward indefinitely and have no expiry date.

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Cash on hand Bank balances Cash and cash equivalents in the statement of financial position	2020 $'000 1 25,358
	25,359

For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the consolidated balance sheet.

		2020
	Notes	$'000
		11,660
Adjustments for:
Depreciation	11, 15	10,793
Amortisation of intangible assets	12	292
Provision for impairment of trade debtors		-
Non-cash employee benefits expense - share-based payments	25	224
Net (gain)/loss on sale or loss of non-current assets	5	66
Net finance expense		754
Income tax expense		5,122
Change in operating assets and liabilities:
(Increase)/decrease in trade and other receivables		(7,738)
(Increase)/decrease in contract assets		-
(Increase) in inventories		680
Increase/(decrease) in trade and other payables		15,022
Increase in contract liabilities		-
Increase/(decrease) in provisions and employee benefits		181
Interest paid		(798)
Interest received		44
Income taxes paid		(5,471)
Net cash inflow from operating activities		30,831

		2020
	Notes	$'000
Acquisition of right-of-use assets	15	16,147
Rights and shares issued to employees under the Employee Performance Rights
Plan for no cash consideration		123
Shares to be issued in partial settlement of business combination	21	3,799
Dividends on unissued shares to be issued as additional ordinary shares	18, 21	234
		20,303

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The following section sets out the movements in liabilities arising from financing activities for the period presented.

Recognised on adoption of AASB 16 Net debt as at 1 July 2019 Cash flows Acquisitions - finance leases and operating lease incentives Cash flows from financing activities Acquisition - leases	(957)
	(957) 3,062 (16,147)

	6,297 (4,812)

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Trade and other receivables Unbilled revenue Prepayments	2020 $'000 42,072 5,582
	47,654 1,438
	49,092

Loans and receivables are carried at amortised cost using the effective interest method. Amortised cost is calculated by taking into account any discount or premium on acquisition over the period of maturity. We establish an allowance for expected credit losses for loans and receivables using the simplified approach permitted by AASB 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

To measure the expected credit losses, trade receivables and unbilled revenue have been grouped based on shared credit risk characteristics and the days past due. The unbilled revenue represents receivables from contracts with customers for which the Company has an unconditional right to consideration arising from the transfer of goods or services to the customer (i.e. only the passage of time is required before payment of the consideration is due) and have substantially the same risk characteristics as the trade receivables for the same types of contracts. The Group has therefore concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates for the unbilled revenue. The expected loss rates are based on the historical credit losses experienced over the previous ten years. We adjust historical loss rates to reflect current and forward looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.

Trade and other receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. They are generally due for settlement within 30 days and are therefore all classified as current. Trade and other receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components, when they are recognised at fair value. The Group holds the trade receivables with the objective of collecting the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method, less any loss allowance.

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Trade and other receivables include amounts for insurance reimbursements if the Group is virtually certain that some or all of a contractual claim will be reimbursed. The expense and reimbursement are presented on a net basis in the profit and loss.

Unbilled revenue represents receivables from contracts with customers for which the Company has an unconditional right to consideration arising from the transfer of goods or services from the customer, but but has not been invoiced at balance date. They are generally converted to trade receivables within 30 days and then due for settlement and are therefore all classified as current. The Group holds unbilled revenue with the objective of collecting the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method, less any loss allowance.

Raw materials Finished goods	2020 $'000 2,464 3,798
	6,262

Inventories recognised as expense in cost of goods sold during the year ended 30 June 2021 amounted to $4,566,000 (2020: $3,769,000).

Raw materials and finished goods are stated at the lower of cost and net realisable value. Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity. Costs are assigned to individual items of inventory on the basis of weighted average costs. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

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Gross value Accumulated depreciation Gross value Accumulated depreciation Gross value Accumulated depreciation Gross value Accumulated depreciation Opening net book amount Acquisition of subsidiary Additions Disposals Transfers Depreciation charge Closing net book amount Opening net book amount Additions Disposals Depreciation charge Closing net book amount	2020 $'000 68,937 (47,689) 21,248 1,024 (558) 466 214 (181) 33 2,051 (1,377) 674 22,421 17,419 164 65 628 18,276 3,114 434 - 173 3,721 7,915 169 - 201 8,285 (23) (171) - - (194) 17 - - (17) - (7,194) (130) (32) (311) (7,667)	2020 $'000 68,937 (47,689)
		21,248
		1,024 (558)
		466
		214 (181)
		33
		2,051 (1,377)
		674
		22,421
	21,248 466 33 674 22,421
	21,248 466 33 674 22,421 6,856 - - 430 7,286 (91) (20) - - (111) (6,277) (116) (16) (238) (6,647)
	21,736 330 17 866 22,949

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Property and equipment is stated at cost, less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the items. The cost of self constructed assets includes the costs of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, the costs of dismantling and removing the items and restoring the site on which they are located and capitalised borrowing costs.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognised within "other income" or "other expenses" in profit or loss. When revalued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, 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 profit or loss during the reporting period in which they are incurred.

Depreciation is recognised in profit or loss on a straight-line or diminishing value basis over the estimated useful lives of each part of an item of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term.

The depreciation rates which reflect the estimated useful lives for the current period are as follows:

•	Plant and equipment	7.50 - 50.00%
•	Motor vehicles	12.50 - 30.00%
•	Computer equipment	37.50 - 50.00%
•	Leasehold improvements	7.50 - 15.00%

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

The cost of improvements to, or in, leasehold properties is amortised over the unexpired period of the lease or the estimated useful life of the improvements to the Group, whichever is shorter.

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Gross value Gross value Accumulated amortisation Gross value Accumulated amortisation Gross value Accumulated amortisation Gross value Accumulated amortisation	2020 $'000 10,324
	10,324
	432 (93)
	339
	1,449 (1,342)
	107
	3,536 (3,030)
	506
	991 (46)
	945
	12,221

Opening net book amount Additions Acquisition of business Amortisation charge Total closing net book value Opening net book amount Additions - internal development Amortisation charge Closing net book amount	Goodwill $'000 Software $'000 Intellectual property $'000 Customer relationships $'000 Exclusive distribution rights $'000 Total $'000 6,429 146 181 - - 6,756 - 281 - - - 281 3,895 - - 590 991 5,476 - (88) (74) (84) (46) (292)
	10,324 339 107 506 945 12,221
	10,324 339 107 506 945 12,221 - - 421 - - 421 - (173) (45) (102) (55) (375)
	10,324 166 483 404 890 12,267

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Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of the finite life intangible assets are reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or period.

Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, consistent with managements assessment of operating segments (note 2).

Significant costs associated with software are deferred and amortised using the diminishing value method over the estimated useful lives of the respective assets, generally 2 to 5 years. Development costs are capitalised when it is probable that the project will be a success considering its commercial and technical feasibility; the Group is able to use or sell the asset; the Group has sufficient resources and intent to complete the development; and its costs can be measured reliably. Capitalised development costs are amortised on a straight-line basis over the period of expected benefit, being their finite life, generally 2 to 5 years.

Separately acquired intellectual property is shown at historical cost. Intellectual property acquired in a business combination is recognised at fair value at the acquisition date. Development costs are capitalised when it is probable that the project will be a success considering its commercial and technical feasibility; the Group is able to use or sell the asset; the Group has sufficient resources and intent to complete the development; and its costs can be measured reliably. They have a finite useful life and are subsequently carried at cost less accumulated amortisation and impairment losses. Amortisation is calculated using the straight line method over the estimated useful lives of the respective assets, generally 8 to 10 years.

The customer relationships were acquired as part of a business combination (see note 21 for details). They are recognised at their fair value at the date of acquisition and are subsequently amortised on a straight-line based on the timing of projected cash flows of the relationships over their estimated useful lives. Amortisation is calculated using the straight line method over the estimated useful lives of the respective assets, generally three to seven years. We test customer relationship assets for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that it might be impaired, and we write its value down when impaired.

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The exclusive distribution rights were acquired as part of a business combination (see note 21 for details). They are recognised at their fair value at the date of acquisition and are subsequently amortised on a straight-line based over the life of the underlying agreement, currently eighteen years.

Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

No impairment was identified at 30 June 2021 or 30 June 2020.

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For the purposes of impairment testing, goodwill is allocated to the Group's operating divisions which represent the lowest level within the Group at which the goodwill is monitored for internal management purposes. The aggregate carrying amount of goodwill allocated to each CGU is as follows:

amount of goodwill allocated to each CGU is as follows:
Mastermyne Mining Wilson Mining	2020 $'000 6,429 3,895
	10,324

The Group tests whether goodwill has suffered any impairment on an annual basis. For the 2021 and 2020 reporting periods, the recoverable amount of the cash-generating units (CGUs) was determined based on value-in-use calculations which require the use of assumptions.

The Mastermyne Mining calculations use cash flow projections based on financial budgets approved by management for 2022, with cash flows beyond the 2022 financial year extrapolated using an average growth rate of 3.5% (2020: 3.3%) to cover a five-year period. Cash flows beyond the five-year period are extrapolated using a terminal growth rate of 2.5% (2020: 2.5%).

A 12.41% before-tax discount rate was applied to cash flow projections (2020: 12.87%). The discount rate was estimated based the Group’s weighted average cost of capital, an industry average beta, risk-free rate consistent with an Australian government 10-year treasury bond with a minimum yield used of 2.00%, a market risk premium of 6.00% and a calculated cost of debt based on the Group’s current debt and interest rates payable on this debt.

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No reasonable change in any of the key assumptions would result in an impairment.

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The Wilson Mining calculations use cash flow projections based on financial budgets approved by management for 2022, with cash flows beyond the 2022 financial year extrapolated using an average growth rate of 4.0% (2020: 4.0%) to cover a five-year period. Cash flows beyond the five-year period are extrapolated using a terminal growth rate of 2.5% (2020: 2.5%).

A 13.42% before-tax discount rate was applied to cash flow projections (2020: 13.96%). The discount rate was estimated based the Group’s weighted average cost of capital, an industry average beta, risk-free rate consistent with an Australian government 10-year treasury bond with a minimum yield used of 2.00%, a market risk premium of 6.00% and a calculated cost of debt based on the Group’s current debt and interest rates payable on this debt.

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No reasonable change in any of the key assumptions would result in an impairment.

Trade and other payables Sundry creditors and accruals	2020 $'000 14,832 19,304
	34,136

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These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

Payables also include liabilities for contractual claims when the Group has a present legal obligation as a result of past events, it is probable that an outflow will be required to settle the obligation and the amount has been reliably estimated. In these circumstances the liability is measured at the present value of management's best estimate of the expenditure required to settle the present obligation at the end of the reporting period.

Liabilities for wages and salaries, including non-monetary benefits, to be settled wholly within 12 months of the reporting date are recognised in sundry creditors and accruals in respect of employees' services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled including on-costs, such as superannuation, workers compensation insurance and payroll tax.

We recognise a liability for employee benefits in the form of bonus plans in sundry creditors and accruals when we have a present legal or constructive obligation to make such payments as a result of past events and a reliable estimate of the obligation can be made. We measure liabilities for bonus plans at the amounts expected to be paid when they are settled; settlement occurs within 12 months.

Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits at the earlier of the following dates: (a) when the Group can no longer withdraw the offer of those benefits; and (b) when the entity recognises costs for a restructuring that is within the scope of AASB 137

and involves the payment of terminations benefits. In the case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.

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Liability for annual leave Liability for vesting sick leave Liability for long service leave Total employee benefit obligations	2020 Current $'000 Non- current $'000 Total $'000 6,488 - 6,488 3,033 - 3,033 466 169 635
	9,987 169 10,156

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Liabilities for annual leave and sick leave expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the consolidated balance sheet.

The Group has liabilities for long service leave that are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. These obligations are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the end of the reporting period of high-quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash outflows. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least 12 months after the reporting period, regardless of when the actual settlement is expected to occur.

This note provides information for leases where the Group is a lessee. The Group does not have any leases where it is a lessor.

The balance sheet shows the following amounts relating to leases:

The balance sheet shows the following amounts relating to leases:
Buildings Equipment Vehicles Current Non-current	2020 $'000 4,052 9,849 561
	14,462
	4,918 9,124
	14,042

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Additions to the right-of-use assets during the 2021 financial year were $5,107,000.

		2020
	Notes	$'000
Buildings		522
Equipment		2,259
Vehicles		346
		3,127
Interest expense (included in finance cost)	6	366
Expense relating to short-term leases (included in contract disbursements and office
expenses)		12,321
Expense relating to leases of low-value assets that are not shown above as
short-term leases (included in administrative expenses)		28
Expense relating to variable lease payments not included in lease liabilities (included
in administrative expenses)		85
Total cash outflow for leases in 2021 was $13756000 (2020: $15862000)

Total cash outflow for leases in 2021 was $13,756,000 (2020: $15,862,000).

The Group leases various offices, warehouses, equipment and vehicles. Rental contracts are typically made for fixed periods of 3 months to 5 years, but may have extension options as described below.

Contracts may contain both lease and non-lease components. The Group allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices. However, for leases of real estate for which the Group is a lessee, it has elected not to separate lease and non-lease components and instead accounts for these as a single lease component.

Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes.

Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.

Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:

fixed payments (including in-substance fixed payments), less any lease incentives receivable
variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date
amounts expected to be payable by the Group under residual value guarantees
the exercise price of a purchase option if the Group is reasonably certain to exercise that option, and
payments of penalties for terminating the lease, if the lease term reflects the Group exercising that option.

Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.

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The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Group, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions.

The Group is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Right-of-use assets are measured at cost comprising the following:

the amount of the initial measurement of lease liability
any lease payments made at or before the commencement date less any lease incentives received
any initial direct costs, and
restoration costs.

Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the Group is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life. While the Group revalues its land and buildings that are presented within property, plant and equipment, it has chosen not to do so for the right-of-use buildings held by the Group.

The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.

Extension and termination options are included in a number of property and equipment leases across the Group. These are used to maximise operational flexibility in terms of managing the assets used in the Group’s operations. The majority of extension and termination options held are exercisable only by the Group and not by the respective lessor.

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In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).

The following factors are normally the most relevant:

If there are significant penalties to terminate (or not extend), the Group is typically reasonably certain to extend (or not terminate).
If any leasehold improvements are expected to have a significant remaining value, the Group is typically reasonably certain to extend (or not terminate).
Otherwise, the Group considers other factors including historical lease durations and the costs and business disruption required to replace the leased asset.

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Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to discount future lease payments to measure the present value of the lease liability at the lease commencement date. Such a rate is based on what the Group estimates it would have to pay a third party to borrow the funds necessary to obtain an asset of a similar value to the right-of-use asset, with similar terms, security and economic environment.

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Contingent consideration Contingent consideration	2020 $'000 -
	3,855

The contingent consideration arrangement requires the Group to pay the former owners of WM 50% of the EBITDA of WM for three years from 2020 to 2022, up to a maximum undiscounted amount of $10,000,000 plus 25% of the EBITDA for the three years from 2020 to 2022 in excess of $20,000,000 with no maximum amount payable. There is no minimum amount payable.

The fair value of the current contingent consideration is based on the actual EBITDA in WM for FY2021. The fair value of the non-current contingent consideration of $1,911,000 was estimated calculating the present value of the future expected cash flows. The estimates are based on a discount rate of 4% and assumed probability-adjusted annual EBITDA in WM. The discount rate has been calculated with regard to the projection and credit risks associated with the liability.

No material changes have occurred to the liability as a result of differences arising from settlement, or changes in the range of outcomes during the year.

Contingent consideration is payable as part of the consideration for the Wilsons Mining acquisition (refer to Note 21). Obligations falling due more than 12 months after the end of the reporting period are recognised as non-current liabilities and discounted to present value.

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					2020
					Cents
Basic earnings	per	share attributable to the ordinary	equity	holders of the Company	11.0

Basic earnings per share attributable to the ordinary equity holders of the Company	2020 Cents 11.0

Diluted earnings per share attributable to the ordinary equity holders of the Company Earnings used in the calculation of basic and diluted earnings per share	2020 Cents 10.9
	2020 $'000 11,557

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Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share Adjustments for calculation of diluted earnings per share: Performance rights outstanding Weighted average number of ordinary and potential ordinary shares used as the denominator in calculating diluted earnings per share	2020 Number 105,351,520 1,211,803
	106,563,323

The Group presents basic and diluted earnings per share data for its ordinary shares.

Basic earnings per share is calculated by dividing:

the profit attributable to owners of the Company, excluding any costs of servicing equity other than ordinary shares
by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and
the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

	2020
	$'000
Final dividend for the year ended 30 June 2020 of 4 cents (2019 - 2 cents) per fully paid
share	2,110
No Special Dividend was paid for the year ended 30 June 2020 (2019 - 2 cents per fully paid
share)	2,110
Interim dividend for the year ended 30 June 2021 of 0.75 cents (2020 - 2 cents) per fully
paid share	2,126
	6,346
	-

Dividends include amounts on shares to be issued as consideration for the Wilson Mining Services Pty Ltd acquisition during the year. These dividends are payable and will be issued as additional ordinary shares. Refer to Note 19 and 21 for more information.

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In addition to the above dividends, since year end the Directors have recommended the payment of a final dividend of 2.25 cents per fully paid ordinary share (2020 - 4 cents).	2020 $'000 4,252

The final dividends recommended after 30 June 2021 will be fully franked out of existing franking credits, or out of franking credits arising from the payment of income tax in the year ending 30 June 2022.

Franking credits available for subsequent reporting periods based on a tax rate of 30.0% (2020 - 30.0%)	2020 $'000 18,602

The above amounts are calculated from the balance of the franking account as at the end of the reporting period, adjusted for:

(a) franking credits that will arise from the payment of the amount of the provision for income tax

(b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date, and (c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date.

The consolidated amounts include franking credits that would be available to the parent entity, Mastermyne Group Limited, if distributable profits of subsidiaries were paid as dividends.

		2020	2020
	Notes	Shares	$'000
Ordinary shares
Fully paid		102,282,985	61,003
		102,282,985	61,003

Opening balance 1 July 2019 Employee share scheme issues 25 Balance 30 June 2020 Employee share scheme issues Dividend reinvestment plan issues Acquisition of subsidiary 21 Balance 30 June 2021	101,665 61,003 618 -
	102,283 61,003 428 - 610 513 2,887 2,779
	106,208 64,295
	106,208 64,295

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The Company does not have authorised capital or par value in respect of issued shares. All issued shares are fully paid. Ordinary shares entitle the holder to participate in dividends, and to share in the proceeds of winding up the Company in proportion to the number and amounts paid on the shares held. Every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and on a poll each share is entitled to one vote.

Information relating to the Employee Performance Rights Plan, including details of rights issued, exercised and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in Note 25.

The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors the return on capital, which the Group defines as net operating income divided by total capital. The Board also monitors the level of dividends to ordinary shareholders.

There were no changes in the Group’s approach to capital management during the year.

Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

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The other equity reserve represents the shares to be issued to the vendors of Wilson Mining Services Pty Ltd as part of the consideration paid for the acquisition of the business.

The share-based payments reserve represents the grant date fair value of equity instruments granted to senior managers or key management personnel of the Company (note 25).

As a result of combinations of entities under common control, an equity account was created called the common control reserve. The balance of this account represents the excess of the fair value of Mastermyne Group Limited securities as at 7 May 2010 over the initial carrying value of Mastermyne Pty Ltd as at the date of Mastermyne Group Limited became the new parent entity of the Group.

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The Group's business activities can expose us to a variety of financial risks: market risk (including foreign exchange risk, price risk, and cash flow and fair value interest rate risk), credit risk, and liquidity risk. The Board, together with management, seeks to identify, monitor and mitigate risk. Internal controls are monitored on a continuous basis and, wherever possible, improved. Risk management is identified in the Group’s various corporate governance policies and will continue to be kept under regular review. Review takes place at both the Audit and Risk Management Committee level, with meetings at least four times a year, and at the Board level.

All of the Group's financial assets except cash and cash equivalents are within the loans and receivables category, and our financial liabilities are all within the financial liabilities recorded at amortised cost category.

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Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities are denominated in a currency other than the Australian dollar. From time to time we make purchases from suppliers who require the currency of settlement to be a foreign currency. At 30 June 2021 and 2020 our exposure to foreign currency risk was immaterial.

The Group is not exposed to equity securities or commodity price risks.

The Group's main interest rate risk arises from lease liabilities. These are obtained at fixed rates and expose the Group to fair value 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 cash equivalents.

The Group's exposure to credit risk is influenced by the individual characteristics of each customer. The majority of the Group's customers are large multinational mining companies with strong payment track records and credit history. There is no formal credit policy in place, however, each customer is assessed individually for creditworthiness before the Group's standard payment and delivery terms and conditions (30 days) are offered. Collateral is not normally obtained. The Group operates under signed contracts, purchase orders and forward purchase agreements which all have agreed payment terms included.

The aged receivables are reviewed on a weekly basis by senior management and overdue amounts followed up with customers for payment. The Group does not require collateral in respect of trade and other receivables.

The Group has one (2020: two) significant customer representing more than 10% of the carrying amount of trade receivables at 30 June 2021. The total of the receivables from this customer is $23,173,000 (2020: $24,609,000). The breakdown of each customer is as follows:

breakdown of each customer is as follows:
Customer 1 Customer 2 Total	2020 $'000 20,267 4,342
	24,609

In the current and comparative period, the Group's cash and cash equivalents are held with AA-Rated Australian Banks.

The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and unbilled revenue.

To measure the expected credit losses, trade receivables and unbilled revenue have been grouped based on shared credit risk characteristics and the days past due. The unbilled revenue represents the Company's unconditional right to consideration arising from the transfer of goods and services to the customer (i.e. only the passage of time is required before payment of the consideration is due), and has substantially the same risk characteristics as the trade receivables for the same types of contracts. The Group has therefore concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates for the unbilled revenue.

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The expected loss rates are based on the payment profiles of sales over a period of 36 months before 30 June 2021 or 1 July 2020 respectively and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.

On that basis, no loss allowance has been recognised as at 30 June 2021 and 30 June 2020.

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Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities. The Group aims to maintain flexibility in funding by keeping committed credit lines available. The Group's approach to managing liquidity is to ensure, as far as possible, that it will maintain sufficient liquidity levels to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group's reputation.

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

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Invoice facility Bank guarantee facility Corporate credit card facility Equipment facility Invoice facility Bank guarantee facility Corporate credit card facility Equipment facility	20,000 20,000 500 443 500 481 10,000 10,000
	31,000 30,924
	20,000 20,000 500 443 500 498 10,000 10,000
	31,000 30,941

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The tables below analyse the Group's financial liabilities into relevant maturity groupings based on their contractual maturities.

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. For interest rate swaps the cash flows have been estimated using forward interest rates applicable at the end of the reporting period.

Notes Trade payables 13 Lease liabilities Notes Trade payables 13 Finance lease liabilities


	34,135 - - - - 34,135 34,135 2,799 2,636 3,750 4,536 1,667 15,388 14,042
	36,934 2,636 3,750 4,536 1,667 49,523 48,177
	36,934 2,636 3,750 4,536 1,667 49,523 48,177

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.

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On 30 August 2019, Mastermyne Group Limited acquired 100% of the ordinary shares of Wilson Mining Services Pty Ltd ('WM'). Details of the business combination were disclosed in Note 23 of the Group's annual financial report for the year ended 30 June 2020.

During the half year period ended 31 December 2020, accounting for the business combination was completed. A measurement period adjustment of $33,000 was made increasing goodwill acquired to $3,895,000 (30 June 2020 - $3,862,000). The adjustment represents the final deferred tax asset acquired after the tax calculations for the stub period were completed. The comparative information has been revised in line with AASB 3 .

During the year 2,886,557 shares were issued to the Vendors of WM in partial settlement of the $3,799,000 outstanding purchase consideration to be settled with the issue of shares. At 30 June 2021, 1,106,600 ($1,077,000) shares remain to be issued and are included in other equity. While unissued, the shares retain their dividend rights and any dividend paid will be settled as additional shares to the vendors calculated on a 5 day volume weighted average price prior to record date.

The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. Consideration for an acquisition comprises the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the company. Consideration also includes the fair value of any contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiary.

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Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.

Acquisition-related costs are expensed as incurred.

The excess of the consideration transferred and the amount of any non-controlling interest in the acquiree over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the difference is recognised directly in profit or loss as a bargain purchase.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss.

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The consolidated financial statements include the financial statements of Mastermyne Group Limited (being the ultimate parent entity) and the subsidiaries listed in the following table:

		2020
		%
Mastermyne Pty Ltd	Australia	100
Mastermyne Engineering Pty Ltd	Australia	100
Mastermyne Underground Pty Ltd	Australia	100
Mastermyne Underground NNSW Pty Ltd	Australia	100
Myne Start Pty Ltd	Australia	100
MyneSight Pty Ltd	Australia	67
Mastermyne Contracting Services Pty Ltd	Australia	100
Ausscaffold Pty Ltd	Australia	100
Diversified Mining Services Pty Ltd	Australia	100
Falcon Mining Pty Ltd	Australia	100
Wilson Mining Services	Australia	100
Mastermyne Crinum Operations Pty Ltd	Australia	-
Metarock Pty Ltd	Australia	-

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On 28 May 2021, the Group acquired the remaining 33% of the issued shares of MyneSight Pty Ltd for $377,000. Immediately prior to the purchase, the carrying amount of non-controlling interest in MyneSight Pty Ltd was $354,000. The Group recognised a decrease in non-controlling interests of $354,000 and a decrease in equity attributable to the owners of the parent of $23,000. The effect on the equity attributable to the owners of Mastermyne Group Limited during the year is summarised as follows:

2020 $'000 - Carrying amount of non-controlling interests acquired - Consideration paid to non-controlling interests Excess of consideration paid recognised in the transactions with non-controlling interests - reserve within equity

There were no transactions with non-controlling interests in 2020.

Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity where the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit or loss, statement of comprehensive income, statement of changes in equity and balance sheet respectively.

Summarised financial information for the parent entity, Mastermyne Group Limited is as follows:

Loss for the year Current assets Current liabilities Share capital Other equity Retained earnings Reserves	2020 $'000 (1,013)
	(1,013)
	34,875
	97,898
	15,295
	43,818
	61,003 4,033 (11,334) 378
	54,080

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The parent entity has entered into a Deed of Cross guarantee with the effect that the Company guarantees debts in respect of its subsidiaries. Further details of the Deed of Cross Guarantee and the subsidiaries subject to the deed, are disclosed in note 23.

The parent entity did not have any contingent liabilities as at 30 June 2021 or 30 June 2020. For information about guarantees given by the parent entity, please see above.

The were no parent entity capital commitments as at 30 June 2021 or 30 June 2020.

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Mastermyne Group Limited and the wholly-owned subsidiaries listed below 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

It is a condition of the Class Order that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of any of the subsidiaries under certain provisions of the . If a winding up occurs under other provisions of the Act, the Company will only be liable in the event that after six months any creditor has not been paid in full.

The subsidiaries subject to the deed are as follows:

Mastermyne Pty Ltd
Mastermyne Engineering Pty Ltd
Mastermyne Underground Pty Ltd
Mastermyne Underground NNSW Pty Ltd
Myne Start Pty Ltd
MyneSight Pty Ltd
Mastermyne Contracting Services Pty Ltd
Ausscaffold Pty Ltd
Diversified Mining Services Pty Ltd
Falcon Mining Pty Ltd
Wilson Mining Services Pty Ltd
Mastermyne Crinum Operations Pty Ltd
Metarock Pty Ltd

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Set out below is a consolidated balance sheet as at 30 June 2021 of the closed group consisting of Mastermyne Group Limited.

Limited.
Cash and cash equivalents Trade receivables Contract assets Inventories Property, plant and equipment Right-of-use assets Intangible assets Deferred tax assets Investments in subsidiaries Trade and other payables Lease liabilities Current tax liabilities Employee benefits Other current liabilities Lease liabilities Employee benefits Other non-current liabilities Contributed equity Reserves Retained earnings	2020 $'000 24,284 48,302 - 6,262
	78,848
	22,074 13,923 11,414 7,819 733
	55,963
	134,811
	33,775 4,533 1,502 9,793 3,799
	53,402
	8,962 84 3,855
	12,901
	66,303
	68,508
	61,003 (19,826) 31,364
	72,541

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

group'.
Revenue Other income Contract disbursements Personnel Expenses Office expenses Depreciation and amortisation expense Other expenses Finance income Finance expense Profit before income tax Income tax expense	2020 $'000 286,726 1,330 (37,399) (215,239) (6,010) (10,813) (1,530)
	17,065
	19 39 (1,049) (773)
	(734)
	16,331 (4,985)
	11,346
	11,346

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Key management personnel compensation is set out below.

Key management personnel compensation is set out below.
Short-term employee benefits Post-employment benefits Long-term benefits Share-based payments	2020 $ 2,565,261 211,165 109,537 223,389
	3,109,352

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Information regarding individual directors and executives compensation and some equity instruments disclosures, as required by Corporations Regulations 2M.3.03, is provided in the remuneration report section of the directors’ report. Apart from the details disclosed in this note, no director has entered into a material contract with the Group since the end of the previous financial year and there were no material contracts involving directors’ interests existing at year-end.

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A number of these entities transacted with the Group in the reporting period. The terms and conditions of the transactions with key management persons and their related parties were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non-key management persons and their related entities on an arm’s length basis.

The following transactions occurred with related parties:

The following transactions occurred with related parties:
Andrew Watts - Watty Pty Ltd (i) Andrew Watts - Watty Pty Ltd (ii) Tony Caruso - Treatwater & Plumbing Pty Ltd (iii)	2020 $ 189,739 23,464 116
	213,319

(i) The Group rents the premises at 45 River Street, Mackay which is owned by Andrew Watts through his company, Watty Pty Ltd. Amounts paid for rent are at arm's length and are due and payable under normal payment terms.

(ii) The Group rents the premises at 56A Grosvenor Drive, Moranbah which is owned by Andrew Watts through his company, Watty Pty Ltd. Amounts paid for rent are at arm's length and are due and payable under normal payment terms.

(iii) The Group paid Treatwater & Plumbing Pty Ltd, which is owned by Anthony Caruso, fees for general plumbing services during the year. Fees paid are at arm's length and due and payable under normal payment terms.

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Mr. C Bloomfield	1,100,000	-	17,629	1,117,629
Mr. A Watts	12,262,245	-	-	12,262,245
Mr. G Meena	100,000	-	-	100,000
Ms. J Whitcombe	94,000	-	-	94,000
Mr. A Caruso	2,132,979	248,726	9,850	2,391,555
Mr. D Sykes	175,626	109,185	-	284,811
Ms. V Gayton	89,200	70,078	-	159,278
Mr. B Maff	89,024	-	-	89,024
Mr. W Price	-	-	11,173	11,173

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(continued)

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The establishment of the Employee Performance Right Plan was approved by shareholders at the 2015 annual general meeting. The plan is designed to provide long-term incentives for senior managers and above (including executive Directors) to deliver long-term shareholder returns. Under the plan, participants are granted options which only vest if certain performance standards are met. Participation in the plan is at the board's discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits. Rights or options are granted under the plan for no consideration and carry no dividend or voting right.

In accordance with the plan, employees holding vested options are entitled to purchase shares in the Company at a set exercise price based on volume weighted average price in the two months preceding the offer.

Set out below are summaries of rights granted under the plan:

Set out below are summaries of rights granted under the plan:
As at 1 July Granted during the year Exercised during the year * Forfeited during the year As at 30 June	2020 Average exercise price per right Number of rights - 1,312,390 - 383,722 - (617,500) - - - 1,078,612
		1,078,612

The weighted average share price at the date of exercise of options exercised during the year ended 30 June 2021 was $0.78 (2020: $0.95).

No rights expired during the periods covered by the above tables.

Performance rights outstanding at the end of the year have the following expiry dates and exercise prices:

					Performance
					Rights
					30 June 2020
22 January 2021	1/10/2021	0.00	STI conditions	187,519	-
24 November 2020	1/10/2023	0.00	1, 2, 3(a)	626,166	-
24 November 2020	1/10/2023	0.00	1, 2, 3(b)	626,166	-
21 November 2019	1/10/2022	0.00	1, 2, 3, 4(a)	191,861	191,861
21 November 2019	1/10/2022	0.00	1, 2, 3, 4(b)	191,861	191,861
21 November 2018	1/10/2021	0.00	1, 2, 3, 4(a)	126,557	126,557
21 November 2018	1/10/2021	0.00	1, 2, 3, 4(b)	126,557	126,557
21 November 2017	1/10/2020	0.00	1, 2, 3, 4(a)	-	220,888
21 November 2017	1/10/2020	0.00	1, 2, 3, 4(b)	-	220,888
Total				2,076,687	1,078,612

Weighted average remaining contractual life of rights outstanding at end of period (years)

1.65 1.20

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Vesting of the rights will be subject to achievement of the vesting conditions set out below and the eligible participant being employed at the vesting date:

: The main vesting condition is that the eligible participant must be employed within the Group on
the Test Date. If employment is ceased with the Group prior to the Test Date, the performance rights will lapse unless the Board, at its absolute discretion, determines otherwise.
: Vesting is also conditional on the continuation of good conduct and the execution of duties in the
best interests of Mastermyne. If it is deemed the eligible participant has acted fraudulently or dishonestly, or is in breach of obligations to Mastermyne, the Board, at its absolute discretion, may determine that some or all of the performance rights will lapse.
: If Vesting Conditions 1 and 2 are achieved there are two further Vesting Conditions that will each
be applied independently to 50% of the performance rights. These Vesting Conditions depend on Mastermyne's TSR percentile rank during the TSR measurement period and the Earnings per Share (EPS) performance over the measurement period: (a) : 50% of the performance rights will be conditional on the Company's TSR rank relative to companies in the ASX Peer Group index; and
(b) : 50% of the performance rights will be conditional on the Company's EPS performance.

For each tranche, the percentage of performance rights which will vest will be as specified in the table below:



Below 50th percentile of the ASX Peer Group	0%	EPS growth at <6%	0%
50th percentile to 75th percentile of the ASX Peer Group	50% plus 2% for each percentile above 50th percentile	EPS growth between 6% and 12%	0% to 100% pro rata
Above 75th percentile of the ASX Peer Group	100%	EPS growth between >12%	100%

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: The main vesting condition is that the eligible participant must be employed within the Group on
the Test Date. If employment is ceased with the Group prior to the Test Date, the performance rights will lapse unless the Board, at its absolute discretion, determines otherwise.
: Vesting is also conditional on the continuation of good conduct and the execution of duties in the
best interests of Mastermyne. If it is deemed the eligible participant has acted fraudulently or dishonestly, or is in breach of obligations to Mastermyne, the Board, at its absolute discretion, may determine that some or all of the performance rights will lapse.
: There is an overriding vesting condition requiring a minimum 8% total shareholder return (TSR)
during the TSR measurement period (i.e. from the Time of Grant to the Test Date).
: If vesting condition 3 is achieved, there are two further vesting conditions that will each be applied
independently to 50% of the performance rights. Both of these vesting conditions depend on Mastermyne's TSR percentile rank during the TSR measurement period: (a) : 50% of the performance rights will be conditional on the Company's TSR rank relative to companies in the ASX All Ordinaries Accumulation index.
(b) : 50% of the performance rights will be conditional on the Company's TSR rank relative to companies in the ASX 200 Resource Accumulation index.

For each tranche, the percentage of performance rights which will vest will be as specified in the table below:



Below 50th percentile of the ASX Peer Group	0%	Below 50th percentile of the Resource Peer Group	0%
50th percentile to 75th percentile of the ASX Peer Group	50% plus 2% for each percentile above 50th percentile	50th percentile to 75th percentile of the Resource Peer Group	50% plus 2% for each percentile above 50th percentile
Above 75th percentile of the ASX Peer Group	100%	Above 75th percentile of the Resource Peer Group	100%

Employees can nominate for up to 50% of their STI award to be settled in shares annually. When a nomination is made, performance rights are issued to the employee and vest at the end of the year in line with the achievements of their relative KPI's. The STI metrics align with the strategic objectives of the Group, with specific financial and non-financial measures (normally 5 or 6) for individual performance, Group performance and underlying performance of the Group.

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The assessed fair value at grant date of rights granted during the year ended 30 June 2021 as long-term incentives was $0.49 per right for Tranche A and $0.48 per right for Tranche B (2020: $0.74 and $0.71 respectively). The fair value at grant date is independently determined using an adjusted form of the Black-Scholes Model which includes a Monte Carlo simulation model that takes into account the exercise price, volatility of the underlying share, the expected dividend yield, the risk-free interest for the term of the right and the correlations and volatilities of the peer group companies.

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The model inputs for rights outstanding at year end are set out below:

	2020	2019	2018
Fair value at grant date Tranche A	$0.7415	$0.8077	$0.5225
Fair value at grant date Tranche B	$0.7100	$0.7727	$0.4695
Share price	$1.14	$1.19	$0.88
Exercise price	$nil	$nil	$nil
Expected volatility (weighted average volatility)	60.0%	75.0%	78.4%
Option life (expected weighted average life)	2.9 years	2.9 years	2.9 years
Expected dividends	1.90%	5.81%	5.81%
Risk-free interest rate (based on government bonds)	0.66%	2.12%	1.86%

The assessed fair value at grant date of rights granted during the year ended 30 June 2021 as short-term incentives ranged from $0.46 to $0.70 (2020: No STI performance rights issued). Given the rights are issued with a $nil exercise price, and the vesting conditions are non-market, the fair value at grant date is determined using the share price on the day the rights were issued ($0.7600) and applying a probability factor representative of the relevant employee's likelihood of achieving their KPI's during the year.

The grant-date fair value of share-based payment awards granted to employees is recognised within "personnel expense" within the statement of comprehensive income, with a corresponding increase in equity, over the period that the employees unconditionally become entitled to the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

Total expenses arising from share-based payment transactions recognised during the period as part of employee benefit expense were as follows:

expense were as follows:
Equity-settled share based payment transactions	2020 $ 224

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

Audit and review of financial statements Total remuneration for audit and other assurance services Tax compliance services Total remuneration for taxation services	2020 $ 110,000
	110,000
	-
	-
	110,000

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A claim for unspecified damages was lodged against Falcon Mining Pty Ltd in 2021 in relation to an event that occurred at a customer site in May 2020. It is not practical to estimate the potential effect of this claim but legal advice indicates that it is not probable that a significant liability will arise.

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Apart from the matter discussed above and the dividend declared as disclosed in Note 18, no matter or circumstance has occurred subsequent to period end that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations or the state of affairs of the Group or economic entity in subsequent financial years.

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(a) the consolidated financial statements and notes set out on pages 24 to 66 are in accordance with the , including:

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(i) complying with Accounting Standards, the 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 2021 and of its performance for the financial 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, and
(c) at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed Group identified in note 23 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 23.

The Directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the .

Note 1 confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board.

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

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Mr. C Bloomfield Director

Brisbane 17/08/2021

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Level 38, 345 Queen Street Brisbane, QLD 4000

Independent Auditor’s Report to the Members of MASTERMYNE GROUP LIMITED

Postal address GPO Box 1144 Brisbane, QLD 4001

p. +61 7 3222 8444

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of Mastermyne Group Limited (“the Company”) and its controlled entities (“the Group”), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes to the financial statements including a summary of significant accounting policies, and the directors’ declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001 , including:

(a) giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year then ended; and
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) “the Code” that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report.

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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pitcher.com.au

Brisbane Sydney Newcastle Melbourne Adelaide Perth

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Key Audit Matter	How our audit addressed the key audit matter	How our audit addressed the key audit matter
Impairment assessment of goodwill ($10.324	million)
(Refer to note 12)
The consolidated statement of financial	Our procedures included amongst others:
position as at 30 June 2021 includes goodwill		Assessing management’s determination of
of $10.324 million which relates to the		the Group’s CGU’s based on our
consolidation of subsidiaries acquired in the		understanding of the nature of the Group’s
current and previous years.		business and internal reporting in order to
		assess how results were monitored and
The carrying amount of goodwill is supported		reported;
by the value-in-use calculations prepared by		Assessing the reasonableness of
management which are based on budgeted		Management’s key assumptions and
future cash flows and key assumptions such		judgements by considering supporting
as growth and discount rates.		management prepared documentation or
		historical performance, where available;
Goodwill is deemed to be a key audit matter due to the use of key assumptions and		Comparing the prior year forecast to assess the accuracy of the forecasting process;
judgements in the value-in-use calculation.		Reviewing management’s value-in-use
		calculations for accuracy;
		Performing a sensitivity analysis of
		management’s value-in-use calculation; and
		Reviewing the adequacy of the disclosures
		in the financial statements.

Other Information

The directors are responsible for the other information. The other information comprises the information included in the Group’s annual report for the year ended 30 June 2021, but does not include the financial report and our auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the ability of the 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 has no realistic alternative but to do so.

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Auditor’s Responsibilities for the Audit of the Financial Report

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

As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

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Report on the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included in pages 6 to 19 of the directors’ report for the year ended 30 June 2021. In our opinion, the Remuneration Report of Mastermyne Group Limited, for the year ended 30 June 2021, 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.

PITCHER PARTNERS J. J. EVANS Partner

Brisbane, Queensland 18 August 2021

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AI assistant

MASTERMYNE GROUP LIMITED Annual Report 2021

65392_rns_2021-08-17_58dca803-b786-4067-bc85-04b7e6b837d6.pdf

Contents

Appendix 4E

Auditor’s Independence Declaration

PITCHER PARTNERS

J. J. EVANS

Acquisition-related costs are expensed as incurred.

Independent Auditor’s Report to the Members of MASTERMYNE GROUP LIMITED

Report on the Audit of the Financial Report

Opinion

Basis for Opinion

Key Audit Matters

Other Information

Responsibilities of the Directors for the Financial Report

Auditor’s Responsibilities for the Audit of the Financial Report

Report on the Remuneration Report

Responsibilities

AI assistant

MASTERMYNE GROUP LIMITED — Annual Report 2021

65392_rns_2021-08-17_58dca803-b786-4067-bc85-04b7e6b837d6.pdf

Contents

Appendix 4E

Auditor’s Independence Declaration

PITCHER PARTNERS

J. J. EVANS

Acquisition-related costs are expensed as incurred.

Independent Auditor’s Report to the Members of MASTERMYNE GROUP LIMITED

Report on the Audit of the Financial Report

Opinion

Basis for Opinion

Key Audit Matters

Other Information

Responsibilities of the Directors for the Financial Report

Auditor’s Responsibilities for the Audit of the Financial Report

Report on the Remuneration Report

Responsibilities

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MASTERMYNE GROUP LIMITED Annual Report 2021