PERPETUAL RESOURCES LIMITED — Interim / Quarterly Report 2021

Feb 2, 2021

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Perpetual Resources Limited ABN 82 154 516 533

Half-Year Report - 31 December 2020

Perpetual Resources Limited Corporate directory 31 December 2020

Directors Mr Julian Babarczy Mr Robert Benussi Mr Brett Grosvenor (appointed 10 September 2020) Mr George Karafotias Company secretary Mr George Karafotias Registered office Suite 801, Level 8, 84 Pitt Street Sydney, NSW 2000 Share register Computershare Investor Services Pty Limited Yarra Falls 452 Johnson Street Abbotsford VIC 3067 Phone: 1300 309 739 Auditor William Buck Level 20, 181 William Street Melbourne VIC 3000 Solicitors K&L Gates Level 25 South Tower 525 Collins Street Melbourne VIC 3000 Bankers Commonwealth Banking Corporation Limited 499 St Kilda Road Melbourne VIC 3004 Stock exchange listing Perpetual Resources Limited securities are listed on the Australian Securities Exchange (ASX code: PEC)

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Perpetual Resources Limited Contents 31 December 2020

Competent person statement	3
Directors' report	4
Auditor's independence declaration	6
Statement of profit or loss and other comprehensive income	7
Statement of financial position	8
Statement of changes in equity	9
Statement of cash flows	10
Notes to the financial statements	11
Directors' declaration	16
Independent auditor's review report to the members of Perpetual Resouces Limited	17

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Perpetual Resources Limited Competent person statement 31 December 2020

Competent person statement

The information in this report that relates to the Exploration Results for the Beharra Project is based on information compiled and fairly represented by Mr Colin Ross Hastings, who is a Member of the Australian Institute of Mining & Metallurgy and consultant to Perpetual Resources Ltd. Mr Hastings is also a shareholder of Perpetual Resources Ltd. Mr Hastings has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he has undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Hastings consents to the inclusion in this report of the matters based on this information in the form and context in which it appears.

The information in this report that relates to the Exploration information for the Beharra Project is based on information compiled and fairly represented by Mr John Doepel, who is a Member of the Australian Institute of Mining and Metallurgy and consultant to Perpetual Resources Limited. Mr Doepel has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he has undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Doepel consents to the inclusion in this report of the matters based on this information in the form and context in which it appears.

The information in this report that relates to Exploration Targets and Mineral Resources is based on information compiled by Ms Elizabeth Haren and Dr Andrew Scogings. Ms Haren is Associate Principal Consultant at Snowden Group Mining Industry Consultants, a Competent Person who is a Member and Chartered Professional of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Dr Scogings is Associate Executive Consultant at Snowden Group Mining Industry Consultants and a Member of the Australasian Institute of Mining and Metallurgy, a Member of the Australian Institute of Geoscientists and Registered Professional Geoscientist in the field of Industrial Minerals. Ms Haren and Dr Scogings have sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Australasian Code for the Reporting of Exploration Results, Mineral Resources, and Ore Reserves. Ms Haren and Dr Scogings consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

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Perpetual Resources Limited Director’s report 31 December 2020

The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Perpetual Resources Limited (referred to hereafter as the 'Company' or 'parent entity') and the entity it controlled at the end of, or during, the half-year ended 31 December 2020.

The information in this report should be read in conjunction with the most recent annual financial report, being the report for the year ended 30 June 2020.

Directors

The following persons were directors of Perpetual Resources Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated:

• Mr Julian Babarczy (Executive Chairman)

• Mr Robert Benussi (Executive Director)

• Mr Brett Grosvenor (Non-executive Director) (appointed 10 September 2020)

• • Mr George Karafotias (Non-executive Director & Company Secretary)

Principal activities

During the financial half-year the principal continuing activities of the consolidated entity consisted of exploration for silica sands at the Company's following exploration areas of interest located in Western Australia.

• Beharra Silica Sands Project in Western Australia,

• Sargon Construction Sands Project in Western Australia, and

• • Eneabba Project in Western Australia.

Dividends

There were no dividends paid, recommended or declared during the current or previous financial half-year.

Review of operations

The loss for the consolidated entity after providing for income tax amounted to $222,361 (31 December 2019: loss $200,100).

Financial position

The net assets of the consolidated entity increased during the half-year period by $2,348,146 to $7,411,315 (30 June 2020: $5,063,169).

The consolidated entity's working capital, being current assets less current liabilities was $2,136,245 at 31 December 2020 (30 June 2020: $1,011,148).

Beharra Silica Sands Project

During the half-year period, the Company continued its exploration & development activities at the Beharra Silica Sands Project (Beharra). The Company initiated a Prefeasibility Study on the project and is nearing completion. The Company has also signed a Memorandum of Understanding for 250,000 metric tonnes per annum high grade silica sand offtake with Shandong Yaoguo Solar Science & Technology Co. Ltd.

Significant changes in the state of affairs

During the half-year period the Company raised $1,975,000 before cost by issuing 49,375,000 fully paid ordinary shares.

The company has appointed Mr Brett Grosvenor as a non-executive director on 10 September 2020. At the Company’s AGM on 30 November 2020, shareholders approved 5 classes of Director’s Performance Shares to Mr Grosvenor valued at $105,600 which has been capitalised during the half year period to 31 December 2020.

There were no other significant changes in the state of affairs of the consolidated entity during the financial half-year.

Matters subsequent to the end of the financial half-year

The impact of the Coronavirus (COVID-19) pandemic is ongoing and while the financial impact to the Company has been minimal up to 31 December 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is continually evolving and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.

On 18 January 2021, 2,500,000 options with strike price of 2 cents were exercised.

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Perpetual Resources Limited Director’s report 31 December 2020

No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.

This report is made in accordance with a resolution of directors, pursuant to section 306(3)(a) of the Corporations Act 2001. On behalf of the directors

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Robert Benussi Managing Director

3 February 2021

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AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF PERPETUAL RESOURCES LIMITED

I declare that, to the best of my knowledge and belief during the half-year ended 31 December 2020 there have been:

• no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and

• no contraventions of any applicable code of professional conduct in relation to the review.

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William Buck Audit (VIC) Pty Ltd ABN 59 116 151 136

A. A. Finnis Director

Melbourne, 3 February 2021

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Perpetual Resources Limited Statement of profit or loss and other comprehensive income For the half-year ended 31 December 2020

Note Revenue Fair value gains/(losses) on financial assets Sundry income Expenses Administrative and corporate expenses Impairment of exploration and evaluation assets Loss before income tax expense Income tax expense Loss after income tax expense for the half-year attributable to the owners of Perpetual Resources Limited Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year attributable to the owners of Perpetual Resources Limited Basic loss per share 10 Diluted loss per share 10	31 December 2020 $ 119,681 - (342,042) - (222,361) - (222,361) - (222,361) Cents (0.05) (0.05)	31 December 2019 $ (35,057) 10,000 (157,416) (17,627) (200,100) - (200,100) - (200,100) Cents (0.08) (0.08)

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes

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Perpetual Resources Limited Statement of financial position As at 31 December 2020

Note Assets Current assets Cash and cash equivalents Trade and other receivables Financial assets at fair value through profit or loss Total current assets Non-current assets Exploration and evaluation 5 Total non-current assets Total assets Liabilities Current liabilities Trade and other payables Total current liabilities Total liabilities Net assets Equity Issued capital 6 Performance share reserves 7 Option reserve 7 Accumulated losses Total equity

Consolidated 31 December 30 June 2020 2020 $ $ 2,034,699 1,089,089 71,472 70,979 156,971 37,290 2,263,142 1,197,358 5,275,071 4,052,021 5,275,071 4,052,021 7,538,213 5,249,379 126,898 186,210 126,898 186,210 126,898 186,210 7,411,315 5,063,169 12,844,557 11,055,345 2,751,968 2,041,273 90,599 20,000 (8,275,809) (8,053,449) 7,411,315 5,063,169

The above statement of financial position should be read in conjunction with the accompanying notes

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Perpetual Resources Limited Statement of changes in equity As at 31 December 2020

Note Consolidated Balance at 1 July 2019 Loss after income tax expense for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs Vesting of performance shares Balance at 31 December 2019 Note Consolidated Balance at 1 July 2020 Loss after income tax expense for the half-year Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Issue of promoter options 7 Vesting of performance shares 7 Contribution of equity, net of transaction costs 6 Balance at 31 December 2020

Issued capital Performance shares reserve Accumulated losses Total equity $ $ $ $ 9,572,399 246,727 (7,412,751) 2,406,375 - - (200,100) (200,100) - - - - - - (200,100) (200,100) 207,460 - - 207,460 - 769,455 - 769,455 9,779,859 1,016,182 (7,612,851) 3,183,190 Issued capital Performance shares reserve Option reserve Accumulated losses Total equity $ $ $ $ $ 11,055,345 2,041,273 20,000 (8,053,449) 5,063,169 - - - (222,361) (222,361) - - - - - - - - (222,361) (222,361) - - 70,599 - 70,599 - 710,695 - - 710,695 1,789,212 - - - 1,789,212 12,844,557 2,751,968 90,599 (8,275,809) 7,411,315

The above statement of changes in equity should be read in conjunction with the accompanying notes

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Perpetual Resources Limited Statement of cash flows For the half-year ended 31 December 2020

Note Cash flows from operating activities Other receipts Payments to suppliers and employees (inclusive of GST) Net cash used in operating activities Cash flows from investing activities Payments for exploration and evaluation Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares 6 Share issue transaction costs 6 Net cash from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the financial half-year Cash and cash equivalents at the end of the financial half-year

Consolidated 31 December 31 December 2020 2019 $ $ - 10,000 (360,663) (210,697) (360,663) (200,697) (482,939) (114,056) (482,939) (114,056) 1,975,000 187,500 (185,788) - 1,789,212 187,500 945,610 (127,253) 1,089,089 494,255 2,034,699 367,002

The above statement of cash flows should be read in conjunction with the accompanying notes

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Perpetual Resources Limited Notes to the financial statements 31 December 2020

Note 1. General information

The financial statements cover Perpetual Resources Limited as a consolidated entity consisting of Perpetual Resources Limited and the entities it controlled at the end of, or during, the 6 months to 31 December 2020. The financial statements are presented in Australian dollars, which is Perpetual Resources Limited and its subsidiary's functional and presentation currency.

Perpetual Resources Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Suite 801, Level 8, 84 Pitt Street Sydney, NSW 2000

The financial statements were authorised for issue, in accordance with a resolution of directors, on 3 February 2021.

Note 2. Significant accounting policies

These general purpose financial statements for the interim half-year reporting period ended 31 December 2020 have been prepared in accordance with Australian Accounting Standard AASB 134 'Interim Financial Reporting' and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting'.

These general purpose financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 30 June 2020 and any public announcements made by the Company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001. The principal accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, unless otherwise stated.

New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the consolidated entity for the half-year reporting period ended 31 December 2020.

Note 3. Critical accounting judgements, estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below.

Coronavirus (COVID-19) pandemic

Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have, on the consolidated entity based on known information. This consideration extends to the nature of exploration and development activities, staffing and geographic regions in which the consolidated entity operates. Other than as addressed

in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the consolidated entity unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID-19) pandemic.

Recovery of deferred tax assets

Deferred tax assets are not recognised in the financial results of the consolidated entity until such time as future probable income is identified and the relevant amount of deferred tax assets are not material.

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Perpetual Resources Limited Notes to the financial statements 31 December 2020

Note 3. Critical accounting judgements, estimates and assumptions (CONT.)

Recovery of royalties

Royalties are not recognised in the financial results of the consolidated entity until such time as future probable income is identified and the relevant amount of royalties receivable are known. Given that the consolidated entity has yet to commence any mining operations, this amount cannot be reliably measured.

Exploration and evaluation costs

Exploration and evaluation costs have been capitalised on the basis that the consolidated entity will commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources. Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made.

During the financial half-year, the consolidated entity did not recognise any impairment of exploration and evaluation assets following a review of the recoverable amount in future periods.

Financial assets at fair value through profit or loss

The consolidated entity is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective.

The financial assets investment has been classified by the consolidated entity as level 1.

As at 31 December 2020, the consolidated entity holds 1,500,000 options in Clearvue Technologies Limited (ASX: CPV). These options have a strike price of 25 cents and expire on 21 June 2021.

The significant judgments made by the Group in recording these options as financial assets held at fair value through the profit or loss include the following, as used in the Black-Scholes option pricing model:

• A spot price of 32 cents as at 31 December 2020, as referable to the traded share price of Clearvue Technologies Limited;

• A volatility of 100%;

• A risk-free rate of 0.089%

• An expected exercise date coinciding with the maturity of the options and a marketability discount of 10%.

Performance Shares Reserve

The Company issued Performance Shares valued at $2,300,000 to the Vendors of the Beherra Sands project in 2019 financial year. The Performance Shares were issued in 3 classes being Class A, B and C. The performance obligations for both Class A and B Performance Shares were achieved in 2019 financial year and the value of these shares were recorded against issued capital. The Directors have assessed the probability of the Class C Performance Shares performance criteria being achieved as 100%. The value of Vendor Performance Shares capitalised during the half-year period to 31 December 2020 is $522,727.

At the Company’s AGM on 30 November 2020, shareholders approved 5 classes of Director’s Performance Shares valued at $105,600 which has been capitalised during the half period to 31 December 2020. It also approved 6 classes of Management’s Performance Shares valued at $82,368 which $41,184 has been capitalised and $41,184 has been expensed during the half period to 31 December 2020.

Option issued

The Company issued 5,000,000 options with a strike price of 4.5 cents expiring 22 October 2024 to agents as incentive for capital raising work.

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Perpetual Resources Limited Notes to the financial statements 31 December 2020

Note 3. Critical accounting judgements, estimates and assumptions (CONT.)

The significant judgments made by the consolidated entity in recording these options as used in the Black-Scholes

option pricing model:

• A spot price of 4 cents as at 22 October 2020, as referable to the traded share price of the Company;

• A volatility of 50%;

• A risk-free rate of 0.5%

• An expected exercise date coinciding with the maturity of the options;

• Fair value of the options issued is $70,599.

Note 4. Operating segments

Identification of reportable operating segments

The consolidated entity has continued to operate under one segment being the exploration, evaluation and development of resources within the Australasia region. 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 allocation of resources are prepared on the consolidated entity as a whole.

Note 5. Non-current assets – exploration and evaluation

Beharra High Purity Silica Project (Western Australia) Sargon Construction Sand Project (Western Australia) Eneabba Project (Western Australia) Consolidated $ $ $ Balance at 30 June 2020 4,011,201 15,084 25,736 Vesting of performance shares 669,511 - - Expenditure during the half-year 553,539 - - Balance at 31 December 2020 5,234,251 15,084 25,736 Note 6. Equity - issued capital Consolidated 31 December 30 June 31 December 2020 2020 2020 Shares Shares $ Ordinary shares - fully paid 448,028,403 398,653,403 12,844,557 Details Date Shares Issue price Balance 01-July-2020 398,653,403 Capital raising 19-October-2020 46,250,000 $0.040 Director's placement 30-November-2020 3,125,000 $0.040 Capital raising cost - $0.000 448,028,403	Beharra High Purity Silica Project (Western Australia) Sargon Construction Sand Project (Western Australia) Eneabba Project (Western Australia) $ $ $ 4,011,201 15,084 25,736 669,511 - - 553,539 - - 5,234,251 15,084 25,736 Consolidated 31 December 30 June 31 December 2020 2020 2020 Shares Shares $ 448,028,403 398,653,403 12,844,557	Beharra High Purity Silica Project (Western Australia) Sargon Construction Sand Project (Western Australia) Eneabba Project (Western Australia) $ $ $ 4,011,201 15,084 25,736 669,511 - - 553,539 - - 5,234,251 15,084 25,736 Consolidated 31 December 30 June 31 December 2020 2020 2020 Shares Shares $ 448,028,403 398,653,403 12,844,557	Beharra High Purity Silica Project (Western Australia) Sargon Construction Sand Project (Western Australia) Eneabba Project (Western Australia) $ $ $ 4,011,201 15,084 25,736 669,511 - - 553,539 - - 5,234,251 15,084 25,736 Consolidated 31 December 30 June 31 December 2020 2020 2020 Shares Shares $ 448,028,403 398,653,403 12,844,557	Total $ 4,052,021 669,511 553,539 5,275,071 30 June 2020 $ 11,055,345 $ 11,055,345 1,850,000 125,000 (185,788) 12,844,557
		Shares Issue price 398,653,403 46,250,000 $0.040 3,125,000 $0.040 - $0.000 448,028,403

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Perpetual Resources Limited Notes to the financial statements 31 December 2020

Note 6. Equity - issued capital (CONT.)

Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

Note 7. Equity – options and performance shares reserve

Promoter’s options		Consolidated
	31 December		30 June
	2020		2020
	$		$
Option reserve	90,599		20,000

The Company issued 5,000,000 options with a strike price of 4.5 cents expiring 22 October 2024 to agents as incentive of capital raising work.

Performance shares reserve	Consolidated 31 December 2020 $ 2,751,968	30 June 2020 $ 2,041,273

Performance share reserve

The Company issued Performance Shares valued at $2,300,000 to the Vendors of the Beherra Sands project in 2019 financial year. The Performance Shares were issued in 3 classes being Class A, B and C. The performance obligations for both Class A and B Performance Shares were achieved in 2019 financial year and the value of these shares were recorded against issued capital. The Directors have assessed the probability of the Class C Performance Shares performance criteria being achieved as 100%. The value of Vendor Performance Shares capitalised during the half-year period to 31 December 2020 is $522,727.

At the Company’s AGM on 30 November 2020, shareholders approved 5 classes of Director’s Performance Shares valued at $105,600 which has been capitalised during the half period to 31 December 2020. It also approved 6 classes of Management’s Performance Shares valued at $82,368 which $41,184 has been capitalised and $41,184 has been expensed during the half period to 31 December 2020. Both Performance shares will expire unless vested 24 months from shareholder approval. Details of the performance milestones are listed below:

Director’s performance shares

• Class A - 880,000 will vest and convert on the completion of a trial shipment;

• Class B - 880,000 will vest and convert on the Board successfully completing a formal study on the Beharra Project at either a Scoping Study or Pre-Feasibility Study level or higher (the “Study”). The Study must have an assessed internal rate of return (IRR) of at least 12% for the Class B Shares to vest;

• Class C - 880,000 will vest and convert on the Company receiving a Mining License approval on any project within the Company's current or future portfolio;

• Class D - 880,000 will vest and convert on the delivery of a successful BFS or the commencement of Site works; and

• Class E - 880,000 will vest and convert on first trial shipment of beneficiated High Purity Silica sand to an offtake partner.

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Perpetual Resources Limited Notes to the financial statements 31 December 2020

Note 7. Equity – options and performance shares reserve (CONT.)

Management performance shares

• Class A - 440,000 will vest and convert on the Company signing a memorandum of understanding or letter of intention for 250ktpa of silica sand;

• Class B- 440,000 will vest and convert on the Company signing a second memorandum of understanding or letter of intention for 250ktpa of silica sand;

• Class C - 880,000 will vest and convert on the Company completing a trial shipment of at least 50,000 m/tonnes at a breakeven price or better;

• Class D- 880,000 will vest and convert on the Board successfully completing a formal study on the Beharra Project at either a Scoping Study or Pre-Feasibility Study level or higher (the “Study”). The Study must have an assessed internal rate of return (IRR) of at least 12% for the Class B Shares to vest;

• Class E - 880,000 will vest and convert on the Company receiving a Mining License approval on any project within the Company's current or future portfolio; and

• Class F - 880,000 will vest and convert on first trial shipment of beneficiated High Purity Silica sand to an offtake partner.

Note 8. Fair value measurement

The carrying value of assets and liabilities held by the consolidated entity approximates their fair value.

Note 9. Events after the reporting period

The impact of the Coronavirus (COVID-19) pandemic is ongoing and while the financial impact to the Company has been minimal up to 31 December 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is continually evolving and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.

No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Note 10. Loss per share

Consolidated 31 December 31 December 2020 2019 $ $ Loss after income tax attributable to the owners of Perpetual Resources Limited (222,361) (200,100) Number Number Weighted average number of ordinary shares used in calculating basic earnings per share 417,632,228 251,249,233 Weighted average number of ordinary shares used in calculating diluted earnings per share 417,632,228 251,249,233 Cents Cents Basic loss per share (0.05) (0.08) Diluted loss per share (0.05) (0.08)	Consolidated 31 December 31 December 2020 2019 $ $ (222,361) (200,100)	Consolidated 31 December 31 December 2020 2019 $ $ (222,361) (200,100)
	Number 417,632,228	Number 251,249,233
		251,249,233
	Cents (0.05) (0.05)	Cents (0.08) (0.08)

The rights to options held by option holders have not been included in the weighted average number of ordinary shares for the purposes of calculating diluted EPS as they do not meet the requirements for inclusion in AASB 133 "Earnings per Share". The 7,500,000 unlisted options on issue are non-dilutive as the consolidated entity has generated a loss for the year.

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Perpetual Resources Limited Director’s declaration 31 December 2020

In the directors' opinion:

• the attached financial statements and notes comply with the Corporations Act 2001, Australian Accounting Standard AASB 134 'Interim Financial Reporting', the Corporations Regulations 2001 and other mandatory professional reporting requirements;

• the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at 31 December 2020 and of its performance for the financial halfyear ended on that date; and

• there are reasonable grounds to believe that the consolidated entity will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of directors made pursuant to section 303(5)(a) of the Corporations Act 2001.

On behalf of the directors

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_________ Robert Benussi Managing Director 3 February 2021

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Perpetual Resources Limited

Independent auditor’s review report to members

Report on the Review of the Half-Year Financial Report

Conclusion

We have reviewed the accompanying half-year financial report of Perpetual Resources Limited (the company) and the entities it controlled at the half-year’s end or from time to time during the half year (the consolidated entity), which comprises the consolidated statement of financial position as at 31 December 2020, the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration.

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Perpetual Resources Limited is not in accordance with the Corporations Act 2001 including:

• a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2020 and of its performance for the half year ended on that date; and

• b) complying with Australian Accounting Standard 134 Interim Financial Reporting and the Corporations Regulations 2001.

Basis for Conclusion

We conducted our review in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity . Our responsibilities are further described in the Auditor’s Responsibilities for the Review of the Financial Report section of our report. We are independent of the Company in accordance with 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 annual financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

Responsibility of Management for the Half-Year Financial Report

The directors of the company are responsible for the preparation of the half-year 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 half-year financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

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Auditor’s Responsibilities for the Review of the Half-Year Financial Report

Our responsibility is to express a conclusion on the half-year financial report based on our review. ASRE 2410 requires us to conclude whether we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the Company’s financial position as at 31 December 2020 and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

William Buck Audit (Vic) Pty Ltd ABN: 59 116 151 136

A. A. Finnis Director

Melbourne, 3 February 2021

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