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REGIS RESOURCES LIMITED Interim / Quarterly Report 2021
65733_rns_2021-02-24_0a1f3ae4-0680-4b1b-b8c7-2c47fc31578c.pdf
Interim / Quarterly Report
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ABN 28 009 174 761
25 February 2021
Manager Announcements Company Announcements Office Australian Securities Exchange Limited Level 4, 20 Bridge Street Sydney NSW 2000
Level 2 516 Hay Street Subiaco WA 6008 Australia
PO Box 862 Subiaco WA 6904 Australia
P 08 9442 2200 F 08 9442 2290
Financial Results and Interim Dividend Declaration for the Half Year Ended 31 December 2020
Key Highlights (All figures expressed in Australian dollars unless stated otherwise)
- Net profit after tax of $84.8 million and net profit margin of 21% reflects the ongoing strong profitability of the Duketon operations.
- Revenue of $401.0 million, with 172,990 ounces of gold sold at an average price of $2,317 per ounce.
- EBITDA of $198.6 million with a strong EBITDA margin of 50%.
- Cash flows from operating activities of $147.8 million.
- Cash and bullion of $220.0 million1, after the payment of $34.3 million in fully franked cash dividends, $40.3 million in income tax, $22.5 million on exploration expenditure and feasibility costs, $60.5 million on capitalised mining costs and $20.3 million on other capital including underground infrastructure and land acquisitions in New South Wales.
- Fully franked interim dividend of 4 cents per share declared for a basic half-year yield of 1.2% and a grossed-up yield of 1.7%.2
- Gold production of 172,977 ounces for H1 FY21 at an AISC of $1,356 per ounce.
- Hedging reduced by a further 40,000 ounces to 359,434 ounces as at 31 December 2020.
- Approval of Garden Well Underground Project.
Comment
Regis Managing Director, Mr Jim Beyer commented: "Regis has again delivered another solid profit result with a half-year profit after tax of approximately $84.8 million and operating cash flows of $147.8 million. A net profit margin of 21% and robust operating cash flows for the half-year continue to point to the strength of the Duketon operations.
During the half-year, the board approved the development of the Garden Well underground mine which will become the second underground mine at the Duketon operations and will be a welcome addition to Regis' production profile once developed. In addition, the Company further consolidated its land holding in the Duketon Greenstone Belt with the acquisition of a valuable resource and tenement package (including the Ben Hur resource) from Stone Resources Australia Limited for a total of $10 million worth of Regis shares and a capped NSR royalty.
At the McPhillamys Gold Project we continue to work with the NSW Department of Planning, Industry and Environment on the process of seeking approval for the mine. In the meantime, we continue to ramp-up preparations for the development of the Project.
In light of this and given the capital expenditure that will be required for the development of McPhillamys (in the event that approval is received), the board has decided to pay an interim dividend at a rate of 4 cents per share, delivering a grossed-up yield of 1.7% for H1. This brings the total dividend payments declared by Regis to over half a billion dollars fully franked."
1 Includes bullion on hand valued at spot as at 31 December 2020 2 Grossed up for 100% franking. Based on closing share price of $3.31 per share on 24 February 2021
FY21 HALF YEAR RESULTS
The board of Regis Resources Limited is pleased to announce a strong half year net profit after tax of $84.8 million for the six months ended 31 December 2020.
As a result of the ongoing strong financial performance of the Company, the Board has declared the following fully franked interim dividend:
| • | Dividend amount | 4 cents per share fully franked |
|---|---|---|
| • | Ex-dividend date | 10 March 2021 |
| • | Record date | 11 March 2021 |
| • | Dividend Reinvestment Plan election date | 12 March 2021 |
| • | Payable date | 25 March 2021 |
The board of Regis Resources Limited has adjusted the Company's interim dividend to 4 cents per share as it continues to ramp-up its financial preparations for its McPhillamys Gold Project in NSW which will require a significant capital investment.
Regis recognises that the final decision by the NSW government is still to be made however the Company believes this is a prudent financial decision given that recommendation by the NSW Department of Planning, Industry and Environment to the Independent Planning Commission may be made in the current quarter.
The Regis Dividend Reinvestment Plan (DRP) includes a 1% discount to the applicable 5-day volume weighted average price and allows existing shareholders to invest their dividends back into the Company with no fees, brokerage or other transaction costs on shares acquired under the DRP. Details of the DRP along with the DRP rules were announced to the ASX on 26 August 2020.
The interim dividend represents a payout ratio of 5% of revenue and 24% of profit after tax for the half year ended 31 December 2020. As at 24 February 2021 this is a basic half-year yield of 1.2% and a grossed-up yield of 1.7%3.
A summary of the financial result for H1 FY21 is presented below:
| Half Year31 Dec 20 | Half Year31 Dec 19 | Change | Change% | |
|---|---|---|---|---|
| Gold sales ($'000) | 400,880 | 370,796 | +30,084 | +8% |
| Profit before tax ($'000) | 123,193 | 133,300 | -12,107 | -9% |
| Profit after tax ($'000) | 84,805 | 93,390 | -8,585 | -9% |
| Basic earnings per share(cents) | 16.64 | 18.38 | -1.74 | -9% |
| Gold sales (ounces)included in revenue | 172,990 | 182,807 | ||
| Average Sale price ($/oz) | 2,317 | 2,063 | ||
| Cash operating costpre-royalties ($/oz) | 1,047 | 889 | ||
| All in sustaining cost(A$/oz)1 | 1,356 | 1,226 | ||
| Dividend declared | ||||
| (cents per share) | 4 | 8 |
| December2020 | December2019 | |
|---|---|---|
| Ore mined (Mbcm) | 2.1 | 2.1 |
| Waste mined (Mbcm) | 14.4 | 13.4 |
| Stripping ratio (w:o) | 6.8 | 6.5 |
| Ore mined (Mtonnes) | 5.2 | 4.9 |
| Ore milled (Mtonnes) | 4.9 | 4.6 |
| Head grade (g/t) | 1.20 | 1.28 |
| Recovery (%) | 92.1 | 94.0 |
| Gold production (Koz) | 173 | 178 |
| Cash cost pre-royalty (A$/oz) | 1,047 | 889 |
Operating results for the Duketon operations for H1 FY21 were as follows:
4 AISC calculated on a per ounce of production basis
A copy of the Company's Condensed Consolidated Interim Financial Report and Appendix 4D for the 6 months to 31 December 2020 are attached.
All in Sustaining Cost (A$/oz)4 1,356 1,226
GUIDANCE FOR FY21
Regis is expecting a year of growth within the operations as production continues to lift in line with the targeted growth profile heading to 400,00oz pa from internal development options over the next couple of years.
The updates on the FY21 key guidance elements are:
• Gold Production 355,000 - 380,000 ounces
We continue to consider our FY21 production guidance appropriate albeit as previously noted with a stronger production weighting to the second half of the financial year.
| $1,030 - 1,090 per ounce |
|---|
| $1,230 - 1,300 per ounce |
GROWTH RELATED EXPENDITURE
• Growth Capital5 increased by $10 million to: $60 - 70 million
Three key areas have impacted this item, being higher than expected mining costs for pre-strip at Moolart Well, timing changes to the Rosemont underground capital development schedule and the addition of works for the Garden Well underground project.
• Exploration decreased by $7million to: $28 million
Forecast FY21 expenditure is reduced due to delayed access to exploration ground and subsequent shortage of drilling rigs both due to COVID related restrictions.
• McPhillamys increased by $7million to: $22 million.
Additional expenditure brought forward to ensure the project is Final Investment Decision (FID) ready in the event of a near term Independent Planning Commission approval.
5 Growth Capital includes open pit and underground pre-production mining costs, site infrastructure and camp expansion costs
Regis Resources Limited and its Controlled Entities
For the half-year ended 31 December 2020
(Previous corresponding period is the half-year ended 31 December 2019)
Results for Announcement to the Market
| 31 December 2020 | 31 December 2019 | Change | ||
|---|---|---|---|---|
| $'000 | $'000 | $'000 | % | |
| Revenue from ordinary activities | 401,045 | 371,366 | 29,679 | 8% |
| Profit from ordinary activities after tax attributable tomembers | 84,805 | 93,390 | (8,585) | (9%) |
| Net profit for the period attributable to members | 84,805 | 93,390 | (8,585) | (9%) |
Dividend Information
After balance date the following interim dividend was declared by the directors:
| Amount per share | Franking | Record Date | Expected Payment Date |
|---|---|---|---|
| 4 cents per share | 100% franked | 11 March 2021 | 25 March 2021 |
Net Tangible Assets
| 31 December 2020 | 31 December 2019 | ||
|---|---|---|---|
| $ | $ | ||
| Net tangible assets per share | 0.66 | 0.59 |
Control Gained or Lost over Entities during the Period
There have been no gains or losses of control over entities in the period ended 31 December 2020.
Financial Results
This report is based on the attached Condensed Consolidated Interim Financial Report for the half-year ended 31 December 2020, which has been reviewed by KPMG, and should be read in conjunction with the consolidated annual financial report as at 30 June 2020 and public announcements made subsequent to 31 December 2020.
ABN 28 009 174 761
and its Controlled Entities
Condensed Consolidated Interim Financial Report
31 December 2020
CONTENTS
| Corporate Information | 4 |
|---|---|
| Directors' Report | 5 |
| Auditor's Independence Declaration | 10 |
| Consolidated Statement of Comprehensive Income | 11 |
| Consolidated Balance Sheet | 12 |
| Consolidated Statement of Changes in Equity | 13 |
| Consolidated Statement of Cash Flow | 14 |
| Notes to the Consolidated Financial Statements | 15 |
| Directors' Declaration | 22 |
| Independent Auditor's Report | 23 |
CORPORATE INFORMATION ABN
28 009 174 761
Directors
James Mactier (Independent Non-Executive Chairman) Jim Beyer (Chief Executive Officer and Managing Director) Fiona Morgan (Independent Non-Executive Director) Steve Scudamore (Independent Non-Executive Director) Lynda Burnett (Independent Non-Executive Director) Russell Barwick (Independent Non-Executive Director)
Company Secretary
Elena Macrides (appointed 12 January 2021) Jon Latto (resigned 12 January 2021)
Registered Office & Principal Place of Business
Level 2 516 Hay Street SUBIACO WA 6008
Share Register
Computershare Investor Services Pty Limited GPO Box D182 PERTH WA 6840
Regis Resources Limited shares are listed on the Australian Securities Exchange (ASX). Code: RRL.
DIRECTORS' REPORT
The directors present their report of Regis Resources Limited ("Regis" or "the Company") for the half-year ended 31 December 2020.
Directors
The names of the Company's directors in office during the half-year and until the date of this report are set out below. Directors were in office for this entire period unless otherwise stated.
James Mactier.............. Independent Non-Executive Chairman Jim Beyer...................... Chief Executive Officer and Managing Director Fiona Morgan............... Independent Non-Executive Director Steve Scudamore ......... Independent Non-Executive Director Lynda Burnett............... Independent Non-Executive Director Russell Barwick............. Independent Non-Executive Director
Review and Results of Operations
Results
Consolidated net profit after tax for the half-year was $84,805,000 (2019: $93,390,000).
Duketon Gold Project Operations
The Duketon Gold Project achieved half year production of 172,977 ounces of gold at a pre-royalty cash cost of $1,047 per ounce1 and an allin sustaining cost of $1,356 per ounce2 (2019: 178,482 ounces of gold produced at a pre-royalty cash cost of $889 per ounce and an all-in sustaining cost of $1,226 per ounce).
Operating results for the Duketon Gold Project for the half-year ended 31 December 2020 were as follows:
| Unit | Duketon SouthOperations | Duketon NorthOperations | TotalDecember2020 | Duketon SouthOperations | Duketon NorthOperations | TotalDecember2019 | |
|---|---|---|---|---|---|---|---|
| Ore mined | bcm | 1,396,111 | 738,145 | 2,134,256 | 1,386,693 | 669,166 | 2,055,858 |
| Waste mined | bcm | 8,751,863 | 5,687,118 | 14,438,981 | 10,190,178 | 3,188,792 | 13,378,970 |
| Stripping ratio | w:o | 6.3 | 7.7 | 6.8 | 7.3 | 4.8 | 6.5 |
| Capital development | m | 2,397 | - | 2,397 | 1,919 | - | 1,919 |
| Operating development | m | 1,879 | - | 1,879 | 734 | - | 734 |
| Ore mined | t | 3,862,201 | 1,361,746 | 5,223,947 | 3,459,255 | 1,477,737 | 4,936,992 |
| Ore milled | t | 3,270,183 | 1,601,385 | 4,871,568 | 3,165,788 | 1,454,125 | 4,619,913 |
| Head grade | g/t | 1.34 | 0.92 | 1.20 | 1.35 | 1.11 | 1.28 |
| Recovery | % | 92.3% | 91.5% | 92.1% | 94.9% | 91.4% | 94.0% |
| Gold production | oz | 129,577 | 43,400 | 172,977 | 130,861 | 47,620 | 178,482 |
| Cash cost pre royalty | A$/oz | 1,057 | 1,018 | 1,047 | 841 | 1,022 | 889 |
| All-in Sustaining Cost | A$/oz | 1,379 | 1,194 | 1,356 | 1,226 | 1,227 | 1,226 |
Duketon South Operations (DSO) gold production was 1% lower than the previous corresponding period with an increase in throughput offset by marginally lower head grade and lower mill recovery at the Project. With Rosemont Underground being in commercial production for the full period, the underground project contributed 15,843 ounces with a total of 4,276 in development metres achieved.
1 Cash cost per ounce is calculated as cash costs of production relating to gold sales (note 6(a)), excluding gold in circuit inventory movements and the cost of royalties, divided by gold ounces produced.
2 All-in sustaining cost per ounce is calculated as cash cost per ounce as described above, plus royalties, amounts capitalised for production stripping costs, sustaining capital and corporate costs, divided by gold ounces produced.
Both of the above measures are included to assist investors to better understand the performance of the business, are non-IFRS measures, and where included in this report, have not been subject to review by the Group's external auditors.
Directors' Report (Continued)
The reduction in grade can be attributed to some grade variability experienced in early-stage mining at Rosemont Underground South and Central zones. During the period development into the higher-grade Main zone commenced which saw an increase in grades from the underground project in comparison to previous periods. A series of slips in Erlistoun pit delayed the scheduled access to high-grade ore with variations to the mine schedule also impacting grade and recoveries. These factors resulted in an increase in the All-in Sustaining Cost (AISC) to $1,379 per ounce at the Duketon South Operations.
Duketon North Operations (DNO) gold production for the half year ended 31 December 2020 decreased by 9% from the previous corresponding period as a result of lower throughput and lower head grade at the Moolart Well mill. Mill throughput was impacted following the introduction of laterite ore while the lower head grade milled was caused by a delay in the commencement of an additional road train fleet. These delays resulted in the depletion of ROM stocks and the processing of some low-grade material.
The AISC of $1,194 per ounce for the half year end 31 December 2020 was 3% lower than the prior period due to lower stripping ratios attributable to AISC.
Corporate
Gold Sales
During the half-year ended 31 December 2020, the Company sold 172,990 ounces of gold at an average price of $2,317 per ounce (2019: 182,807 ounces at an average price of $2,063 per ounce). The Company had a hedging position at the end of the period of 359,493 ounces of spot deferred contracts with an average price of A$1,617 per ounce (2019: 428,510 ounces of spot deferred contracts with an average price of A$1,617 per ounce).
Dividend Payment
Regis' net profit after tax for the year ended 30 June 2020 was $199.5 million, and as a result the Board declared a fully franked final dividend of 8 cents per share ($40.8 million) with shareholders invited to participate in a dividend reinvestment plan (DRP). The final dividend was paid in October 2020 with $6.5 million reinvested under the DRP. The final dividend payment took total dividends paid in relation to the 2020 financial year to 16 cents per share ($81.5 million).
Resource & Tenement Acquisition – Brightstar Resources Limited (Formerly Stone Resources Australia Limited) (BRL)
The Company's portfolio of Value Growth Projects was strengthened on 2 September 2020 when the Company acquired a resource and tenement package from Brightstar Resources Limited (ASX: BTR), formerly Stone Resources Australia Limited (ASX: SHK), for $9.75 million in Regis shares and a cash consideration of $0.25 million. A capped 1% Net Smelter Royalty (NSR) is payable to BRL after the first 100,000 ounces of production, this will revert to a 0.0025% NSR for four years after $5 million has been paid under the royalty. In addition, a royalty of $1 per tonne of ore processed greater than 1g/t gold is payable to Parkerville Enterprises Pty Ltd. The acquisition included the Ben Hur Gold Project, located approximately 30 kilometres south of Garden Well, with a current Mineral Resource compliant with JORC code 2012 of 5.8 million tonnes at 1.6g/t gold for 290,000 ounces. This acquisition will add further life to the Duketon Operations while expanding the Duketon Greenstone Belt (DGB) footprint for future exploration programmes.
Development
Garden Well Underground Project
In December 2020, the Company announced the approval for the development of a new underground mine under the current Garden Well open pit based on a positive Feasibility Study on the Garden Well South (GWS) Underground Gold Project. Development at the GWS Underground Project commenced in the March 2021 quarter with processing of first underground development ore scheduled for the December 2021 quarter and stope production to commence in the June 2022 quarter. The maiden GWS Underground Mineral Resource Estimate (MRE) is 2.4 million tonnes at 3.6g/t gold for 270,000 ounces with considerable opportunity for additional Resources down plunge of the existing GWS Resource.
McPhillamys Gold Project (MGP)
The McPhillamys Gold Project in New South Wales is one of Australia's largest undeveloped open pit gold projects with an Ore Reserve of 61 million tonnes @ 1.0g/t gold for 2.02 million ounces and is the highest priority growth project for the Company.
In the first week of September 2020, the assessment phase of the McPhillamys Development Application reached another milestone with the submission of the Amendment Report and Responses to Submissions to the Department of Planning, Industry and Environment (DPIE).
The Project is now in the penultimate phase of the assessment and approval process with DPIE (who assess State Significant Projects) expected to make a recommendation on the Project to the Independent Planning Commission (IPC) in the current quarter. The IPC are then tasked with, under recently revised guidelines, holding a public hearing and making a determination within a twelve-week timeframe. During the December 2020 quarter, DPIE forwarded additional requests for information from other regulatory departments to Regis, all of which were responded to.
Directors' Report (Continued)
Regis recognises and respects that the final decision by the government is still to be made and while the process is still underway a decision on the Development Application could be made in the first half of 2021. Should this occur and based on current plans, the Company foresees that construction could potentially commence in the second half of 2021. As noted, this is highly dependent on the timing of a successful application approval.
A Project execution team has been assembled and is continuing to progress work into more detailed areas including mining, processing, water and power supply. With IPC approval Regis would expect to finalise any outstanding scope changes and costings and as soon as practical thereafter provide the Feasibility Study summary to the Market.
In the meantime, work continues to develop a detailed understanding of local business capacity and where these businesses have the potential to be incorporated into construction activity. This assessment, along with other contract and design related works, is underway to ensure that for a favourable decision from the IPC in the first half of 2021, the Project will be as ready for Final Investment Decision and as "Shovel Ready" as practical.
Exploration
Extensive exploration and resource development continued during the half-year to 31 December 2020, with intensive regional exploration drilling activities focused on targets across the DGB in addition to deep exploration drilling for depth extensions to existing gold resources at the Duketon Gold Project in Western Australia.
During the half year ended 31 December 2020, Regis drilled a total of 103,099 metres across the DGB as shown below:
| By Drilling Type | ||||||
|---|---|---|---|---|---|---|
| Type | No. Holes | Metres | ||||
| Aircore | 321 | 24,426 | ||||
| RC | 265 | 52,838 | ||||
| Diamond | 52 | 25,835 | ||||
| Total | 638 | 103,099 |
Significant exploration projects advanced during the half-year ended 31 December 2020 are outlined below.
All drilling results and Resource estimations highlighted in this report are detailed fully in announcements to the ASX made by the Company on 23 October 2020 and 27 January 2021 along with the associated JORC Code 2012 disclosures.
Ben Hur Project
Following the acquisition of the Ben Hur Gold Project and associated tenement package in September 2020, a significant drilling campaign commenced to infill the existing resource to provide sufficient data for a maiden reserve and extend the drilling at depth and along strike to increase the resource base. 22,857 metres of reverse circulation (RC) drilling was completed to reduce drill spacing across the resource area to 25m x 25m and extend the resource down dip with drill testing at depth on a 50m x 50m spacing. 484 metres of diamond drilling was completed for geotechnical purposes. Metallurgical and other feasibility studies are underway in order to update the Mineral Resource Estimate and potentially provide sufficient data to develop a maiden Ore Reserve.
Garden Well North Underground Project
One kilometre to the north of the approved Garden Well South Underground Project (approved in December 2020) there is another target area that is the down plunge extension of the Garden Well North mineralisation. Deep drilling re-commenced beneath the northern end of the pit to test the continuity of significant gold mineralisation including 9 metres at 8.7g/t gold and 9 metres at 5.3 g/t gold identified in earlier programmes. A total of 9 diamond drill holes were completed for 4,815 metres. Assay results confirmed two separate high-grade south plunging shoots showing potential for underground mine development are hosted within sheared ultramafics beneath the northern end of the pit.
Rosemont Underground Project
The deep diamond drilling programme continued to explore the high-grade shoots which extend at depth beneath existing underground infrastructure. 390 metres of RC drilling and 12,707 metres of diamond drilling was completed to test down plunge extensions of high-grade gold mineralisation outside the current underground resource domains. Drill results below the northern end of Main Pit show narrow intercepts and indicate the potential for new high-grade shoots in this area. The drill results at Rosemont South show two new ore shoots with multiple intercepts over suitable widths for underground mine development. Drilling continues in an effort to delineate the size of the new high-grade shoots at Rosemont South.
Directors' Report (Continued)
Gloster Project
The Gloster gold deposit is hosted in a package of intermediate volcanics and intrusives. The gold mineralised system is structurally complex, consisting of steeply dipping shears and multiple flat lying mineralised vein sets beneath the existing pit. Mineralised zones are characterised by several metres of quartz-carbonate-sulphide veins with visible gold.
62 RC drill holes were completed for 13,734 metres with an additional 6 diamond drill holes for 3,141 metres. Drilling in the current and previous periods have provided sufficient data to generate a preliminary lithological and mineralisation model. Mineralisation persists to 500 metres beneath the pit and consist of a series of narrow, high-grade, strike limited quartz veins. An internal review has commenced to determine if this mineralisation will prove economic for an underground mine development. High-grade gold intercepts close to the base of the pit could contribute to extending reserves and ultimately driving the base of the pit deeper.
Baneygo Project
The Baneygo Project is located 15 kilometres south and along strike of the Rosemont Gold Mine and the current Mineral Resource is 12 million tonnes @ 1.0g/t Au for 380,000 ounces, including Ore Reserves of 3 million tonnes @ 1.2g/t Au for 140,000 ounces. 8 RC holes for 3,313 metres and 6 diamond drill holes for 2,474 metres targeted the down plunge and strike extensions to gold mineralisation beneath the oxide resources. RC and diamond drilling to date has provided sufficient data to generate a preliminary lithological and mineralisation model with potential for developing the mineralisation that extends 100 metres below the northern end of the pit and this will be pursued from in pit prior to open cut mine completion.
Duketon Regional Exploration
Greenfields exploration campaigns continued to focus on identifying new mineralised trends and drill testing high priority geological target areas. Much of the western trend is concealed by transported sediment cover, is significantly underexplored, and is in a geologically similar setting to other large gold systems in the Eastern Goldfields.
During the period drill testing the western trend included 13,129 AC drill metres at Matt's Bore, 5,634 AC drill metres and 6,276 RC drill metres drilled at Betelgeuse. A single diamond hole was completed to 523 metres to confirm the lithology, determine the dip of the stratigraphy and orientation of potentially gold bearing structures at Betelgeuse. The diamond hole returned low level gold assays associated with narrow quartz veins and confirmed the presence of a gold mineralised system.
Systematic drilling continues along the 30-kilometre strike length of prospective geology in search for a large oxide gold deposit.
Discovery Ridge Project
Discovery Ridge continues to shape up as a very significant additional value proposition for the McPhillamys Gold Project. Pre-feasibility studies are ongoing with a maiden Ore Reserve targeted for the coming year.
COVID-19
Regis' Crisis Management Team has continued to manage our ongoing response to COVID-19 which has been coordinated in cooperation with our contractors.
The Company is maintaining a range of measures across its business consistent with advice from State and Federal health authorities. These measures help ensure the health and welfare of our employees and their respective communities.
To date there have been no confirmed cases of COVID-19 across the business.
Regis continues to assist communities in Western Australia to deal with the ongoing impacts of COVID-19 and has maintained its participation in the FIFO DETECT research programme.
Events After Balance Date
On 12 January 2021, Ms Elena Macrides replaced Mr Jon Latto as Company Secretary with Mr Latto continuing in his role as Chief Financial Officer.
On 24 February 2021, the directors declared an interim, fully franked dividend of 4 cents per share on ordinary shares (refer Note 8). The dividend record date is 11 March 2021 and will be paid on 25 March 2021.
Except as disclosed above, there have been no events subsequent to balance date that would significantly affect the amounts reported in the consolidated financial statements as at and for the half-year ended 31 December 2020.
Auditor's Independence Declaration
The auditor's independence declaration as required under Section 307C of the Corporations Act 2001 is set out on the following page and forms part of the Directors' Report for the half-year ended 31 December 2020.
Rounding
The amounts contained in this report and in the financial report have been rounded to the nearest $1,000 (unless otherwise stated) under the option available to the company under ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191. The Company is an entity to which the legislative instrument applies.
Signed in accordance with a resolution of the directors.
Mr James Mactier Non-Executive Chairman Perth, 24 February 2021
Lead Auditor's IndependenceDeclaration under Section 307C of the Corporations Act 2001
To the Directors of Regis Resources Limited
I declare that, to the best of my knowledge and belief, in relation to the review of Regis Resources Limited for the half-year ended 31 December 2020 there have been:
- i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and
- ii. no contraventions of any applicable code of professional conduct in relation to the review.
KPMG Derek Meates Partner Perth 24 February 2021
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the half-year ended 31 December 2020
| Consolidated | |||
|---|---|---|---|
| 31 December 2020 | 31 December 2019 | ||
| Note | $'000 | $'000 | |
| Revenue | 4 | 401,045 | 371,366 |
| Cost of goods sold | 6 | (266,569) | (227,483) |
| Gross profit | 134,476 | 143,883 | |
| Other income | 14 | 437 | |
| Investor and corporate costs | (1,785) | (1,193) | |
| Personnel costs | (4,597) | (5,254) | |
| Share-based payment expense | 13 | (3,652) | 395 |
| Occupancy costs | (263) | (335) | |
| Other corporate administrative expenses | (245) | (537) | |
| Exploration and evaluation written off | - | (1,065) | |
| Other | (8) | (1,912) | |
| Finance costs | 6 | (747) | (1,119) |
| Profit before income tax | 123,193 | 133,300 | |
| Income tax expense | 7 | (38,388) | (39,910) |
| Net profit | 84,805 | 93,390 | |
| Other comprehensive income | |||
| Items that may be reclassified to profit or loss: | |||
| Unrealised gains on cash flow hedges | - | - | |
| Realised gains transferred to net profit | - | - | |
| Tax effect | - | - | |
| Other comprehensive income for the period, net of tax | - | - | |
| Total comprehensive income for the period | 84,805 | 93,390 | |
| Profit attributable to members of the parent | 84,805 | 93,390 | |
| Total comprehensive income attributable to members of the parent | 84,805 | 93,390 | |
| Basic profit per share attributable to ordinary equity holders of the parent(cents per share) | 16.64 | 18.38 | |
| Diluted profit per share attributable to ordinary equity holders of the parent(cents per share) | 16.59 | 18.34 |
CONSOLIDATED BALANCE SHEET
As at 31 December 2020
| 31 December 202030 June 2020Note$'000$'000Current assetsCash and cash equivalents202,573192,428Receivables9,7627,799Inventories1080,43874,430Financial assets9239270Other current assets4,0302,778Total current assets297,042277,705Non-current assetsInventories1071,68663,503Property, plant and equipment245,617261,676Exploration and evaluation expenditure12261,164230,260Mine properties under development2,2962,188Mine properties295,079275,939Intangible assets2,7102,572Right-of-use assets1134,29238,034Total non-current assets912,844874,172Total assets1,209,8861,151,877Current liabilitiesTrade and other payables974,46074,181Income tax payable14,2997,471Provisions3,9873,994Lease liabilities917,94215,856Total current liabilities110,688101,502Non-current liabilitiesDeferred tax liabilities108,698117,408Provisions75,69875,845Lease liabilities915,84722,041Total non-current liabilities200,243215,294Total liabilities310,931316,796Net assets898,955835,081EquityIssued capital451,376435,145Reserves34,87531,223Retained profits412,704368,713 | Consolidated | ||
|---|---|---|---|
| Total equity | 898,955 | 835,081 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the half-year ended 31 December 2020
| Consolidated | |||||
|---|---|---|---|---|---|
| Issued capital | Share-basedpayment reserve | Financial assetsreserve | Retained profits/(accumulatedlosses) | Total equity | |
| $'000 | $'000 | $'000 | $'000 | $'000 | |
| At 1 July 2020 | 435,145 | 29,506 | 1,717 | 368,713 | 835,081 |
| Profit for the period | - | - | - | 84,805 | 84,805 |
| Other comprehensive income | - | - | - | - | - |
| Total other comprehensive income forthe period | - | - | - | - | - |
| Total comprehensive income for theperiod | - | - | - | 84,805 | 84,805 |
| Transactions with owners in their capacityas owners: | |||||
| Share-based payments expense | - | 3,652 | - | - | 3,652 |
| Dividends paid | - | - | - | (40,814) | (40,814) |
| Dividends reinvested | 6,540 | - | - | - | 6,540 |
| Issued capital | 9,750 | 9,750 | |||
| Shares issued, net of transaction costs | (59) | - | - | - | (59) |
| At 31 December 2020 | 451,376 | 33,158 | 1,717 | 412,704 | 898,955 |
| At 1 July 2019 | 434,880 | 29,362 | 1,717 | 250,505 | 716,464 |
| Profit for the period | - | - | - | 93,390 | 93,390 |
| Other comprehensive income | - | - | - | - | - |
| Total other comprehensive income forthe period | - | - | - | - | - |
| Total comprehensive income for theperiod | - | - | - | 93,390 | 93,390 |
| Transactions with owners in their capacityas owners: | |||||
| Share-based payments expense | - | (395) | - | - | (395) |
| Dividends paid | - | - | - | (40,654) | (40,654) |
| Shares issued, net of transaction costs | 265 | - | - | - | 265 |
| At 31 December 2019 | 435,145 | 28,967 | 1,717 | 303,241 | 769,070 |
CONSOLIDATED STATEMENT OF CASH FLOW
For the half-year ended 31 December 2020
| Consolidated | |||
|---|---|---|---|
| 31 December 2020 | 31 December 2019 | ||
| Note | $'000 | $'000 | |
| Cash flows from operating activities | |||
| Receipts from gold sales | 400,880 | 370,796 | |
| Payments to suppliers and employees | (212,426) | (191,007) | |
| Interest received | 194 | 665 | |
| Interest paid | (606) | (673) | |
| Income tax paid | (40,269) | (33,034) | |
| Other income | - | 437 | |
| Net cash from operating activities | 147,773 | 147,184 | |
| Cash flows from investing activities | |||
| Acquisition of plant and equipment | (11,119) | (35,920) | |
| Payments for exploration and evaluation (net of rent refunds) | (22,350) | (19,871) | |
| Payments for acquisition of exploration assets | (270) | (20,000) | |
| Proceeds from held to maturity investments | 31 | (1) | |
| Payments for mine properties under development | (108) | (23,174) | |
| Payments for mine properties | (60,423) | (31,932) | |
| Proceeds on disposal of plant and equipment | - | 1 | |
| Net cash used in investing activities | (94,239) | (130,897) | |
| Cash flows from financing activities | |||
| Proceeds from issue of shares | - | 279 | |
| Payment of transaction costs | (59) | (14) | |
| Payment of lease liabilities | (9,055) | (5,621) | |
| Dividends paid | 8 | (34,275) | (40,654) |
| Net cash used in financing activities | (43,389) | (46,010) | |
| Net increase/(decrease) in cash and cash equivalents | 10,145 | (29,723) | |
| Cash and cash equivalents at 1 July | 192,428 | 188,697 | |
| Cash and cash equivalents at 31 December | 202,573 | 158,974 |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the half-year ended 31 December 2020
1. Corporate Information
The interim condensed consolidated financial statements of Regis Resources Limited and its subsidiaries (collectively referred to as the "Group") for the six months ended 31 December 2020 were authorised for issue in accordance with a resolution of the directors on 24 February 2021.
Regis Resources Limited (the "Company") is a for profit company, limited by shares, incorporated and domiciled in Australia whose shares are publicly traded. The Group's principal activities are the exploration for and production of gold.
2. Basis of Preparation and Accounting Policies
Basis of preparation
The interim condensed consolidated financial statements for the half-year ended 31 December 2020 have been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act 2001.
The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements for the year ended 30 June 2020 which are available upon request from the Company's registered office or at www.regisresources.com.
Significant accounting policies
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 30 June 2020.
3. Operating Segment Information
The following table presents revenue and profit information for reportable segments for the half-years ended 31 December 2020 and 2019 respectively.
| Duketon NorthOperations | Duketon SouthOperations | Unallocated | Total | |||||
|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |
| $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
| Segment revenue | ||||||||
| Sales to external customers | 99,997 | 98,570 | 300,883 | 272,226 | - | - | 400,880 | 370,796 |
| Other revenue | - | - | - | - | 165 | 570 | 165 | 570 |
| Total segment revenue | 99,997 | 98,570 | 300,883 | 272,226 | 165 | 570 | 401,045 | 371,366 |
| Total revenue per thestatement of comprehensiveincome | 401,045 | 371,366 | ||||||
| Segment result | ||||||||
| Segment net operatingprofit/(loss) before tax | 31,538 | 37,019 | 102,860 | 106,073 | (11,205) | (9,792) | 123,193 | 133,300 |
| Income tax expense | (38,388) | (39,910) | ||||||
| Net profit after tax | 84,805 | 93,390 |
Segment assets
Total segment assets have increased since the last annual report. The Group's two reporting segments comprise the Duketon Gold Project, which includes Duketon North (DNO) and Duketon South (DSO). These segments are unchanged from those reported at 30 June 2020. DNO comprises Moolart Well, Gloster, Anchor, Dogbolter-Coopers and Petra. DSO comprises Garden Well, Rosemont, Rosemont Underground, Erlistoun, Tooheys Well and Baneygo. Expansionary activity at DNO to bring Petra into production and DSO to bring Baneygo and Rosemont Underground into production, has contributed to the increase for these segments. Unallocated items comprise exploration and evaluation assets relating to areas of interest where an economically recoverable reserve is yet to be delineated. Segment assets as at 31 December and 30 June are as follows:
Notes to the Financial Statements (Continued)
| Duketon NorthOperations | Duketon SouthOperations | Unallocated | Total | |||||
|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |
| $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
| As at 31 December | ||||||||
| Segment operating assets | 111,818 | 105,830 | 560,278 | 502,375 | 537,790 | 441,674 | 1,209,886 | 1,049,879 |
| As at 30 June | ||||||||
| Segment operating assets | 110,192 | 98,843 | 551,479 | 422,140 | 490,206 | 433,013 | 1,151,877 | 953,997 |
4. Revenue
| Consolidated | |||
|---|---|---|---|
| Half-year ended31 December 2020 | Half-year ended31 December 2019 | ||
| $'000 | $'000 | ||
| Revenue | |||
| Gold sales | 400,880 | 370,796 | |
| Interest | 165 | 570 | |
| 401,045 | 371,366 |
5. Physical Gold Delivery Commitments
Open contracts at balance date, along with the current amortisation profile agreed with the Company's hedge provider, Macquarie Bank Limited, are summarised in the table below and overleaf:
| Gold for physicaldelivery | Contracted goldsale price | Value of committedsales | Mark-to-market(i) | |||||
|---|---|---|---|---|---|---|---|---|
| 31 December2020 | 30 June2020 | 31 December2020 | 30 June2020 | 31 December2020 | 30 June2020 | 31 December2020 | 30 June2020 | |
| ounces | ounces | $/oz | $/oz | $'000 | $'000 | $'000 | $'000 | |
| - Spot deferred contracts(ii) | 359,493 | 399,494 | 1,617 | 1,614 | 581,122 | 644,716 | (301,901) | (388,179) |
| - Spot | - | - | - | - | - | - | - | - |
| 359,493 | 399,494 | 581,122 | 644,716 | (301,901) | (388,179) |
Mark-to-market has been calculated with reference to the following spot price at period end $2,456/oz $2,586/oz
- (i) Mark-to-market represents the value of the open contracts at balance date, calculated with reference to the gold spot price at that date. A negative amount reflects a valuation in the counterparty's favour.
- (ii) The contracted gold sale price disclosed for spot deferred contracts reflects a weighted average of a range of contract prices. The range of prices at the end of the half-year was from $1,405/oz to $1,833/oz (30 June 2020: $1,415/oz to $1,854/oz).
The Company's current volume limits are as follows:
| Volume |
|---|
| 600,000 ounces |
| 400,000 ounces |
| 200,000 ounces |
| 100,000 ounces |
| Nil |
As at 31 December 2020, the Group has no further gold sale commitments.
6. Expenses
| Consolidated | |||
|---|---|---|---|
| Half-year ended31 December 2020 | Half-year ended31 December 2019 | ||
| $'000 | $'000 | ||
| (a) Cost of goods sold | |||
| Cash costs of production | 171,465 | 163,063 | |
| Royalties | 19,530 | 17,475 | |
| Depreciation of mine plant and equipment | 31,099 | 19,213 | |
| Amortisation of mine properties | 44,475 | 27,732 | |
| 266,569 | 227,483 | ||
| (b) Finance costs | |||
| Interest expense | 606 | 675 | |
| Unwinding of discount on provisions | 141 | 444 | |
| 747 | 1,119 | ||
| 7.Income Tax | |||
| A reconciliation between tax expense and the product of accounting profitbefore tax multiplied by the Group's applicable income tax rate is as follows: | |||
| Accounting profit before income tax | 123,193 | 133,300 | |
| At the Group's statutory income tax rate of 30% (2019: 30%) | 36,958 | 39,990 | |
| Share-based payments | 1,096 | (118) | |
| Other non-deductible expenditure | 2 | 3 | |
| Adjustment in respect of income tax of previous years | 332 | 35 | |
| Income tax expense reported in the statement of comprehensive income | 38,388 | 39,910 | |
| Consolidated | |||
| 8.Dividends |
| Half-year ended31 December 2020 | Half-year ended31 December 2019 | ||
|---|---|---|---|
| $'000 | $'000 | ||
| Declared and paid during the half-year: | |||
| Dividends on ordinary shares | |||
| Final dividend for 2020: 8 cents (2019: 8 cents) (fully-franked at 30%) | 40,814 | 40,654 | |
| Proposed by the directors after balance date but not recognised as a liability at31 December: | |||
| Dividends on ordinary shares | |||
| Interim dividend for 2021: 4 cents (2020: 8 cents) (fully-franked at 30%) | 20,481 | 40,654 | |
| Dividend franking account | |||
| Franking credits available for future years at 30% adjusted for the payment ofincome tax and dividends payable | 94,537 | 52,409 | |
| Impact on the franking account of dividends proposed before the financial | |||
| report was issued but not recognised as a distribution to equity holders during | |||
| the period | (8,778) | (17,423) |
The ability to utilise the franking credits is dependent upon the ability to declare dividends.
9. Financial Assets and Financial Liabilities
Set out below is an overview of financial assets (other than cash and short-term deposits) and financial liabilities, held by the Group at 31 December 2020 and 30 June 2020.
| Consolidated | |||
|---|---|---|---|
| As at31 December 2020$'000 | As at30 June 2020$'000 | ||
| Financial assets at amortised cost | |||
| Receivables | 239 | 270 | |
| Total financial assets | 239 | 270 | |
| Financial liabilities at amortised cost | |||
| Trade and other payables | 74,460 | 74,181 | |
| Obligations under leases | |||
| Current | 17,942 | 15,856 | |
| Non-current | 15,847 | 22,041 | |
| Total financial liabilities | 108,249 | 112,078 |
Fair Values
The carrying amounts and estimated fair values of all of the Group's financial instruments recognised in the financial statements are materially the same.
10. Inventories
| Consolidated | ||
|---|---|---|
| As at31 December 2020$'000 | As at30 June 2020$'000 | |
| Current | ||
| Ore stockpiles | 52,030 | 48,545 |
| Gold in circuit | 15,210 | 13,759 |
| Bullion on hand | 9,880 | 8,601 |
| Consumable stores | 3,318 | 3,525 |
| 80,438 | 74,430 | |
| Non-current | ||
| Ore stockpiles | 71,686 | 63,503 |
At 31 December 2020, all inventories were carried at cost except for a portion of ore stockpiles written back to net realisable value resulting in an expense totalling $1,740,200 being recognised in cost of goods sold.
At the prior year end, all inventories were carried at cost except for a portion of Rosemont ore stockpiles written back to net realisable value resulting in an expense totalling $115,000 being recognised in cost of goods sold.
11. AASB 16 Leases
| Consolidated | |||||
|---|---|---|---|---|---|
| As at31 December 2020$'000 | As at30 June 2020$'000 | ||||
| Lease liability recognised | |||||
| Comprising: | |||||
| Current | 17,942 | 15,856 | |||
| Non-current | 15,847 | 22,041 | |||
| 33,789 | 37,897 |
Right-of-use assets were measured at the amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the balance sheet as at 30 June 2020.
| Consolidated | ||
|---|---|---|
| As at31 December 2020$'000 | As at30 June 2020$'000 | |
| Plant & equipment | 22,380 | 24,249 |
| Furniture & equipment | 70 | 57 |
| Buildings & infrastructure | 11,842 | 13,728 |
| Total right-of-use assets | 34,292 | 38,034 |
12. Exploration and Evaluation Assets
| Consolidated | |||
|---|---|---|---|
| As at31 December 2020 | As at30 June 2020 | ||
| $'000 | $'000 | ||
| Reconciliation of movements during the year | |||
| Balance at 1 July | 230,260 | 185,748 | |
| Expenditure for the period | 20,885 | 37,326 | |
| Acquisition of tenements (i) | 10,019 | 21,402 | |
| Impairment | - | (1,686) | |
| Transferred to mine properties under development | - | (12,530) | |
| Balance at 30 June | 261,164 | 230,260 | |
(i) On 2 September 2020 the Company acquired a resource and tenement package from Brightstar Resources Limited (ASX: BTR), formerly Stone Resources Australia Limited (ASX: SHK), for $9.75 million in Regis shares and a cash consideration of $0.25 million.
Notes to the Financial Statements (Continued)
13. Share-Based Payments
In November 2020, a total of 277,364 Performance Rights were granted to the Chief Executive Officer and Managing Director, Mr Jim Beyer (154,353), and to executives Mr Stuart Gula (67,350) and Mr Jon Latto (55,661), in the form of long-term incentives (LTI's) under the Group's Executive Incentive Plan (EIP). The performance conditions that the Board has determined will apply to the Performance Rights are summarised below:
| Tranche | Weighting | Performance Conditions |
|---|---|---|
| Tranche A | 50% of the Performance Rights | The Company's relative total shareholder return (RTSR) measured against the RTSRs of12 comparator mining companies |
| Tranche B | 25% of the Performance Rights | The Company's life of mine reserves growth in excess of depletion |
| Tranche C | 25% of the Performance Rights | McPhillamys Project targets as determined by the Board |
The fair value at grant date of Tranche A, which has market based performance conditions, was estimated using a Monte Carlo simulation, and a Black Scholes option pricing model was used to estimate the fair value at grant date of Tranches B and C, which have non-market based performance conditions.
The table below details the terms and conditions of the grant and the assumptions used in estimating fair value:
| Grant date | 25 November 2020 |
|---|---|
| Value of the underlying security at grant date | $3.75 |
| Exercise price | Nil |
| Dividend yield | 3.50% |
| Risk free rate | 0.11% |
| Volatility | 45% |
| Performance period (years) | 3.00 |
| Commencement of measurement period | 1 July 2020 |
| Test date | 30 June 2023 |
| Remaining performance period (years) | 2.59 |
In November 2020, 37,816 Performance Rights were granted to the Chief Executive Officer and Managing Director, Mr Jim Beyer, in the form of short-term incentives (STI's) under the Group's Executive Incentive Plan (EIP). The performance conditions that the Board has determined will apply to the Performance Rights are summarised below:
Tranche Weighting Performance Conditions
Tranche D 100% of the Performance Rights Mr. Jim Beyer being an employee of the company as at 1 July 2021
The fair value at grant date of Tranche D, which has non-market based performance conditions, was estimated using a Black Scholes option pricing model.
The table below details the terms and conditions of the grant and the assumptions used in estimating fair value:
| Grant date | 25 November 2020 |
|---|---|
| Value of the underlying security at grant date | $3.75 |
| Exercise price | Nil |
| Dividend yield | 3.50% |
| Risk free rate | 0.09% |
| Volatility | 45% |
| Performance period (years) | 0.60 |
| Commencement of measurement period | 25 November 2020 |
| Test date | 1 July 2021 |
| Remaining performance period (years) | 0.60 |
In November 2020, 592,447 Performance Rights were granted to employees in the form of short-term incentives (STI's) under the Group's Executive Incentive Plan (EIP). The performance conditions that the Board has determined will apply to the Performance Rights are summarised below:
| Grant date | 14 September 2020 |
|---|---|
| Value of the underlying security at grant date | $5.34 |
| Exercise price | Nil |
| Dividend yield | 3.50% |
| Risk free rate | 0.22% |
| Volatility | 45% |
| Performance period (years) | 0.24 |
| Commencement of measurement period | 14 September 2020 |
| Test date | 11 December 2020 |
| Remaining performance period (years) | 0.24 |
The fair value of the Performance Rights granted during the half year was $4,008,000 and the weighted average fair value was $4.42.
For the six months ended 31 December 2020, the Group has recognised $3,652,000 of share-based payments in the statement of comprehensive income (31 December 2019: ($395,000)).
14. Subsequent Events
On 12 January 2021, Ms Elena Macrides replaced Mr Jon Latto as Company Secretary with Mr Latto continuing in his role as Chief Financial Officer.
On 24 February 2021, the directors declared an interim, fully franked dividend of 4 cents per share on ordinary shares (refer Note 8). The dividend record date is 11 March 2021 and will be paid on 25 March 2021.
Except as disclosed above, there have been no events subsequent to balance date that would significantly affect the amounts reported in the consolidated financial statements as at and for the half-year ended 31 December 2020.
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of Regis Resources Limited, I state that:
In the opinion of the directors:
- (a) The financial statements and notes of Regis Resources Limited for the half-year ended 31 December 2020 are in accordance with the Corporations Act 2001, including:
- (i) giving a true and fair view of the Group's financial position as at 31 December 2020 and of its performance for the half-year ended on that date; and
- (ii) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and
- (b) There are reasonable grounds to believe that the Company and Group will be able to pay its debts as and when they become due and payable.
On behalf of the board
Mr James Mactier Non-Executive Chairman Perth, 24 February 2021
Independent Auditor's Review Report
To the shareholders of Regis Resources Limited
Report on the Interim Financial Report
Conclusion
We have reviewed the accompanying Interim Financial Report of Regis Resources Limited.
Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the Interim Financial Report of Regis Resources Limited does not comply with the Corporations Act 2001, including:
- giving a true and fair view of the Group's financial position as at 31 December 2020 and of its performance for the half-year ended on that date; and
- complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.
The Interim Financial Report comprises the:
- Consolidated balance sheet as at 31 December 2020
- Consolidated statement of 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
- Directors' Declaration.
The Group comprises Regis Resources Limited (the Company) and the entities it controlled at the half year's end or from time to time during the half-year.
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 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 annual financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation.
Responsibilities of the Directors for the Interim Financial Report
The Directors of the Company are responsible for:
- the preparation of the Interim Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001.
- such internal control as the Directors determine is necessary to enable the preparation of the Interim Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.
Auditor's Responsibilities for the Review of the Interim Financial Report
Our responsibility is to express a conclusion on the Interim 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 Interim Financial Report does not comply with the Corporations Act 2001 including giving a true and fair view of the Group's financial position as at 31 December 2020 and its performance for the half-year ended on that date, and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.
A review of an Interim 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.
KPMG Derek Meates Partner Perth 24 February 2021