Genesis Resources : Annual Report, 30 June 2024

About this update from Genesis Resources Limited

GENESIS RESOURCES LIMITED ACN 114 787 469 ANNUAL REPORT 30 JUNE 2024 CONTENTS CORPORATE DIRECTORY 3 DIRECTORS' REPORT 4 REMUNERATION REPORT (AUDITED) 21 CORPORATE GOVERNANCE STATEMENT 25 AUDITOR'S INDEPENDENCE DECLARATION 26 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 27 CONSOLIDATED STATEMENT OF FINANCIAL POSITION 28 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 29 CONSOLIDATED STATEMENT OF CASH FLOWS 30 NOTES TO THE FINANCIAL STATEMENTS 31 CONSOLIDATED ENTITY DISCLOSURE STATEMENT 51 DIRECTORS' DECLARATION 52 INDEPENDENT AUDITOR'S REPORT 53 ADDITIONAL SECURITIES EXCHANGE INFORMATION 56 G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 2 CORPORATE DIRECTORY GENESIS RESOURCES LIMITED ACN 114 787 469 DIRECTORS Mr Eddie Lung Yiu Pang Managing Director & Executive Chairman Mr Kim Heng Lim Non-Executive Director Mr Yau Young Lim Non-Executive Director Mr Chin Niap Mah Non-Executive Director Mr James Patterson Non-Executive Director Mr Deric Kok Bin Wee Non-Executive Director COMPANY SECRETARY Ms Alyn Tai CHIEF FINANCIAL OFFICER Ms Patricia Wong REGISTERED OFFICE Level 23, Rialto South Tower 525 Collins Street T +61 3 9852 9159 Melbourne Victoria 3000 SHARE REGISTER Computershare T (local call) 1300 850 505 Yarra Falls, T (international call) + 61 (0) 3 9415 4000 452 Johnston Street Abbotsford, Victoria 3067 AUDITOR RSM Australia Partners T + 61 (0) 3 9286 8000 Level 27 F + 61 (0) 3 9286 8199 120 Collins Street Melbourne, Victoria 3000 WEBSITE ADDRESS www.genesisresourcesltd.com.au KEY UPCOMING DATES 2024 Annual General Meeting: 11.00am (Melbourne time) on Tuesday, 26 November 2024. Closing date for receipt of director nominations prior to the 2024 5.00pm (Melbourne time) on Tuesday, 8 Annual General Meeting: October 2024. Genesis Resources Limited is a public company limited by shares, incorporated and domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange (ASX: GES). G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 3 DIRECTORS' REPORT The Directors of Genesis Resources Limited are pleased to present the annual report of the Company for the financial year ended 30 June 2024. In accordance with the Corporations Act 2001, the Directors report as follows: DIRECTORS The Directors in office at any time during or since the end of the year to the date of this report are: Current Directors EDDIE LUNG YIU PANG Managing Director, 28 September 2015 - present Executive Chairman, 26 November 2015 - present Non-Executive Chairman, 28 September 2015 - 25 November 2015 Executive Chairman, 1 December 2013 - 27 September 2015 Non-Executive Chairman, 6 March 2009 - 30 November 2013 KIM HENG LIM Non-Executive Director, 31 May 2016 - present YAU YOUNG LIM Non-Executive Director, 21 November 2016 - present CHIN NIAP MAH Non-Executive Director, 31 May 2016 - present JAMES PATTERSON Non-Executive Director, 24 October 2016 - present DERIC KOK BIN WEE Non-Executive Director, 11 December 2009 - 26 November 2012, and 16 January 2013 - present EDDIE PANG, Managing Director & Executive Chairman Eddie Pang was appointed to the Board in March 2009. Mr Pang is involved in a joint venture in relation to a food flavouring manufacturing facility in Wisconsin, USA. The joint venture has an established distribution network of food flavours and additives in China, and supplies products to major dairy processors and beverage producers. Mr Pang has a number of private business interests in Australia, including vineyards and timber plantation investments. He has an extensive network of business associates in several large corporations in China and the Middle East. Mr Pang also served as a director of ASX listed company Lincoln Minerals Ltd (ASX: LML) from 1 December 2013 until 22 November 2019. Mr Pang currently has a relevant interest in 3,210,000 fully paid ordinary shares in the Company. KIM HENG LIM, Non-Executive Director Mr Lim has an MBA from Southern California University and is the founder and Executive Chairman of Senheng New Retail Bhd ("Senheng"), the largest chain retailer of consumer electrical and electronic products in Malaysia, which was established in 1989 and has more than 120 physical stores across every state in the country. Mr Lim has robust experience on crafting business model, business direction as well as strategic planning. In recognition of his leadership, he has received several awards and accolades such as "Sin Chew Business Excellence Person of the Year", "EY Entrepreneur of the Year - Master Entrepreneur", as well as "Male Entrepreneur of the Year" from the Star Outstanding Business Awards. Mr Lim has not held any directorships of other ASX listed companies in the last three years. Mr Lim currently has a relevant interest in 281,924,863 fully paid ordinary shares in the Company. G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 4 YAU YOUNG LIM, Non-Executive Director Mr Lim obtained his Bachelor of International Business degree from Macquarie University (Sydney, Australia) in 2009, and a Master of Business in Marketing from the University of Technology in Sydney in 2011. He also obtained an executive degree in Business Analytics & Big Data from the Harvard Business School in 2016. In 2019, he was recognised as a certified HRDF trainer. Mr Lim started his career in 2011 at Senheng Electric (KL) Sdn Bhd, Malaysia's largest consumer electrical retail store, as the Head of Marketing, where he was mainly responsible for corporate marketing and branding of the company. He subsequently held roles as Head of Merchandising, Head of Customer Loyalty & Big Data, Head of Training and Development, and Head of Recruitment. He ended this tenure at Senheng Electric (KL) Sdn Bhd in 2019. Mr Lim subsequently served as Chief Operating Officer at SH Retail Academy Sdn Bhd, a training academy specialised in creating and conducting programs with emphasis on the retail industry. SH Retail Academy Sdn Bhd was founded in September 2019 to support Malaysian SMEs, especially in the retail industry, to grow by increasing productivity through digitalisation and upskilling of employees. Mr Lim currently serves as Deputy General Manager at S Ecosystem (M) Sdn Bhd, a technology company specialised in developing super apps. Founded in 2021, S Ecosystem (M) Sdn Bhd is currently focused on evolving the Senheng app from being just a consumer electronics utility app to becoming a super app containing various cross-industry lifestyle pillars. S Ecosystem (M) Sdn Bhd collaborates with industry leading partners such as Alibaba to deliver high value solutions to its customers. Mr Lim currently sits on the board of Purple League Sports Management Sdn Bhd, the organiser of Malaysia's first professional badminton league, with the world's top players and participation of more than 15 countries, and which is broadcasted in more than 10 countries. Mr Lim currently has a relevant interest in 109,043,587 fully paid ordinary shares in the Company. CHIN NIAP MAH, Non-Executive Director Mr Mah obtained a Chartered Certified Accountant qualification from the Association of Chartered Certified Accountants (ACCA) in 2004, and is currently a Fellow member of ACCA and the Malaysian Institute of Accountants. Mr Mah possesses more than 25 years of finance and accounting experience, having held positions in various companies from a diverse range of industries. He also holds an MBA from Golden State University. Mr Mah has not held any directorships of other ASX listed companies in the last three years. Mr Mah does not have a relevant interest in any shares in the Company. JAMES PATTERSON, Non-Executive Director Mr Patterson, who served as the Company's Exploration Manager until 30 April 2019, is a geologist with 30 years' exploration experience, primarily in gold and copper-gold systems. He has worked with several successful Exploration Companies such as Delta Gold, Newmont, Oxiana and MMG. He has worked in Australia, Asia, The Pacific Islands, Eastern Europe and North and South America. He is a Member of the Australian Institute of Geoscientists (AIG). Mr Patterson has not held any directorships of other ASX listed companies in the last three years. Mr Patterson does not have a relevant interest in any shares in the Company. DERIC WEE, Non-Executive Director Prior to joining the Board in December 2009, Mr Wee had been involved in the financial services industry since 1989 as a stockbroker and investment banker. Mr Wee worked within well-established financial services companies which are part of financial and banking conglomerates in Malaysia. Mr Wee acquired extensive experience and competence in key areas including sales, marketing, share and stock trading, and coordinated a number of corporate strategies such as initial public offerings, mergers and acquisitions, restructurings, placements and advisory services relating to securities listed on Bursa Malaysia and the ASX. Mr Wee has not held any directorships of other ASX listed companies in the last three years. Mr Wee currently has a relevant interest in 1,860,000 fully paid ordinary shares in the Company. G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 5 Senior Management Alyn Tai, Company Secretary Alyn Tai, LL.B (Hons) is a corporate and commercial lawyer who specialises in the areas of corporate governance, mergers and acquisitions, and equity capital markets. Patricia Wong, Chief Financial Officer Patricia Wong is a Certified Practising Accountant of CPA Australia Limited and a Fellow of the Institute of Public Accountants, Australia. Ms Wong is also an associate member of the Chartered Institute of Management Accountants (UK) and Institute of Chartered Secretaries and Administrators (UK). Operating and Financial Review Nature of Operations and Principal Activities The principal activities of the entity during the period were exploration for and evaluation of gold, manganese and base metals. There was no significant change in the nature of the consolidated entity's activities during the year. Exploration Activities - Overview During the financial year, the consolidated entity undertook various feasibility studies in relation to its Macedonian Project. Plavica Project (Macedonia) The completed Mining Project was submitted to the Ministry of Economy in the Government of North Macedonia on 23 March 2021. It has subsequently passed the assessment by the Audit and Revision Committee appointed by the Ministry of Economy on 31 May 2021. The completion and reporting of the ongoing environmental studies is the last required submission for the Application of Mining Approval. Work during the year has included an ongoing groundwater modelling study, a biodiversity study and regular monitoring of noise, dust and water. In addition, the planting of 42,000 tree seedlings was completed in 2023. The Genesis team reforested around 14,750 seedlings. Genesis also issued about 16,000 free seedlings for afforestation to interested local residents of Kratovo and Probishtip. For these activities, the state enterprise National Forests issued us a certificate of appreciation. During the financial year-ended ended 30 June 2024, the notification of intention to implement a 'project' to the Ministry of Environment was submitted. In addition a Strategic Assessment Report was submitted to the Ministry of Environment to finalize planning documentation at the Ministry of Transport and Communications. Further agreements with landholders are also ongoing. Australian Projects Alice Springs Cu-Au and Arltunga Au Projects (Central Australia) The Company has completed RC drilling campaigns over its two Central Australian Tenements in the Northern Territory. Drilling was undertaken during July and August 2023. G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 6 Exploration Activities - Macedonia PLAVICA PROJECT (100% interest) Gold, Silver, Copper The completed Mining Project was submitted to the Ministry of Economy in the Government of North Macedonia on 23 March 2021. It has subsequently passed the assessment by the Audit and Revision Committee appointed by the Ministry of Economy on 31 May 2021. The completion and reporting of the ongoing environmental studies is the last required submission for the Application of Mining Approval. The Plavica Gold-Copper-Silver Project in the Republic of North Macedonia is administered through the JV Company Silgen, which was 62% owned by Genesis and 38% owned by the nominee of Genesis' North Macedonian-based joint venture partner, RIK Sileks Ad Kratovo (Sileks). Ownership of all assets in the Plavica tenement are held by the JV Company. As announced to the ASX on the 26 th June 2024, in accordance with the terms of the joint venture agreement between Genesis and Sileks (JV Agreement), Genesis has acquired the balance (38%) of the shares in the JV Company from Sileks, and is now the sole owner (100%) of the shares in Silgen. Genesis acquired the shares from Sileks in exchange for a mineral royalty of 4% of all future 'products' (metals, ores, previous stones, concentrates, minerals and mineral resources extracted or produced from the Plavica Project concessions), if any are extracted or produced, in the condition in which the products leave the concessions (such as in concentrate, ore form or metal). Following the transfer of the Balance Shares to Genesis, the JV Agreement has been terminated. As a result, Sileks no longer holds a security interest in Genesis' shares in Silgen. Figure 1 shows the location of Plavica Gold-Copper-Silver Project in the Republic of North Macedonia. Figure 1: Location of Plavica Gold-Copper-Silver Project, Republic of North Macedonia G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 7 Exploration Activities - Australia Figure 2: Location of Australian Projects. ARLTUNGA PROJECT: Copper, Gold (EL25238) (GES 100%) The Arltunga Gold Project consists of Exploration Licence EL25238 covering 95.2 sq km, and is located approximately 110 km northeast of Alice Springs (Figure 2) in the vicinity of the Arltunga Goldfield. Thirty three historical gold mines and prospects are known in the licence area. EL25238 covers 31 sub blocks. A Reverse Circulation (RC) drilling program was completed in July 2023 consisting of nine holes for 898m. The Drilling is being undertaken by Downunder Drilling using a UDR650 Rig and samples were sent to Intertek Darwin / Perth for analysis. Table 1 shows the details of the drill holes completed. Figure 3 shows the location of the completed holes at Arltunga. The drill holes all intercepted Quartz-Mica felsic schists of the Cavenagh Formation within the Palaeo-Mesoproterozoic Arltunga Nappe Complex which forms the Eastern part of the Arunta Block. Numerous quartz veins were intercepted and a number of holes holes has sericite-chlorite alteration. Results are pending. A visit was also undertaken on the 13 th of July 2023 by Traditional Owners with the CLC to see the drill rig in operation . G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 8 Tenement Actual Prospect GDA94 GDA94 RL Dip Azim Final Date Hole Hole No East North (mag) Depth Completed (Actual) (Actual) Arltunga ARRC002 Wipeout 474321 7412480 613 -60 110 108 13/07/2023 Arltunga ARRC003 Wipeout 474313 7412478 613 -60 150 70 14/07/2023 Arltunga ARRC004 Wipeout 474419 7412503 612 -60 90 108 15/07/2023 Arltunga ARRC009 Wipeout 474568 7412513 613 -60 60 120 19/07/2023 Arltunga ARRC001 Wipeout NE 474678 7412897 617 -60 90 96 13/07/2023 Arltunga ARRC005 Round Hill 474664 7409703 649 -60 120 108 17/07/2023 Arltunga ARRC008 Round Hill 474639 7409721 645 -60 300 96 18/07/2023 Arltunga ARRC007 Round Hill 474646 7409726 652 -60 250 96 18/07/2023 Arltunga ARRC006 Round Hill 474647 7409735 652 -60 320 96 17/07/2023 Totals 898 Table 1 (above) Location of Drill Holes at Arltunga The Licence Renewal Application was lodged on 1 November 2023 and was approved on the 4 January 2024. The new expiry date is 7 November 2024. The 17 Annual Technical Report was lodged on 23 November 2023. Accepted as satisfactory on 21 March 2024. An application for a new Sacred Site Clearance Certificate was lodged to the Central Land Council on the 17 July 2024. New proposed drill hole locations and maps were provided. Letter to AAPA advising follow-up drilling program on 14 March 2024. Received by Compliance division on 18 March 2024. Planning of follow-up drill holes for 2024 is currently being undertaken. Figure 3 (above) Location of Drill Pads at Arltunga for Drilling in July 2023. Grid is UTM GDA94 Zone 53K. G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 9 ALICE SPRINGS PROJECT: Copper, Gold, Iron (EL24817) (GES 100%) The Alice Springs Project consists of Exploration Licence EL24817 covering 372.59 sq km, is located approximately 110-155 km northeast from Alice Springs in the Northern Territory (Figure 2) . EL24817 covers 118 sub-blocks. The 18 Annual Technical Report was lodged on 18 April 2024. A Licence Renewal Application was lodged on 8 April 2024. This is pending. Current expiry date is 17 April 2025. A Reverse Circulation (RC) drilling commenced on 26 th June 2023. A total of 17 RC Holes for 1,448m, were completed with five of these completed in the June Quarter (Table 2). The Drilling was undertaken by Downunder Drilling and samples were sent to Intertek Darwin / Perth for analysis. Figure 4 shows the location of the completed holes at Alice Springs. Drilling has intersected Quartz-Feldspar Mica schists and Meta-Dolerites on the Proterozoic Hill Soak Bore Metamorphics. The Hill Soak Bore Metamorphics make up part of the Bimodal Narwietooma package (>1820 ma) that was active when this part of the Arunta Block was a convergent plate margin. The drilling has also intersected within this package abundant quartz veins, a banded iron formation and minor sulphides. Results have been returned and have overall been disappointing. The Diana 8 and Diana 2 prospects, however did encounter minor chalcocite and have returned thin low grade horizons of copper and gold. The best result at Diana 8 was in hole ASRC001: 5m @ 1.02% Cu & 0.26 g/t Au from 25m within a meta-dolerite, close to the contact with a quartz-feldspar mica schist. The best results at Diana 2 was from hole ASRC006: 4m @ 0.43% Cu & 0.16 g/t Au from 39m. Results are summarized in Table 2 and the best results shown in plan in Figure 5 with a section through ASRC001 shown as Figure 6. Tenement Actual Prospect GDA94 GDA94 RL Dip Azim Final Date Hole Hole No East North Depth Completed (Actual) (Actual) Alice Springs ASRC001 Diana 8 443170 7447173 682 -55 130 78 26/06/2023 Alice Springs ASRC002 Diana 8 443141 7447132 684 -55 130 78 27/06/2023 Alice Springs ASRC003 Diana 8 443112 7447108 686 -55 130 78 27/06/2023 Alice Springs ASRC004 Diana 8 443085 7447062 690 -55 130 96 29/06/2023 Alice Springs ASRC005 Diana 2 441736 7446018 678 -60 150 96 30/06/2023 Alice Springs ASRC006 Diana 2 441685 7445979 684 -60 150 78 3/07/2023 Alice Springs ASRC007 Diana 2 441643 7445969 685 -60 150 78 3/07/2023 Alice Springs ASRC008 Diana 2 441587 7445951 686 -60 150 104 4/07/2023 Alice Springs ASRC009 Diana 2/EM Anomaly 6 441385 7445731 685 -55 180 78 5/07/2023 Alice Springs ASRC010 Diana 2/EM Anomaly 6 441365 7445757 686 -55 130 78 5/07/2023 Alice Springs ASRC011 Cnr Post Hill 442090 7444748 693 -60 200 96 6/07/2023 Alice Springs ASRC012 Cnr Post Hill 442142 7444734 696 -55 210 96 6/07/2023 Alice Springs ASRC013 Corner Post Hill/Anomaly 11 443324 7444878 687 -55 180 96 7/07/2023 Alice Springs ASRC014 Corner Post Hill/Anomaly 11 443381 7444707 679 -55 210 84 7/07/2023 Alice Springs ASRC015 Diamond T/EM Anomaly 20 447871 7443353 698 -60 210 90 9/07/2023 Alice Springs ASRC016 Diamond T/EM Anomaly 20 447837 7443366 697 -60 180 84 10/07/2023 Alice Springs ASRC017 Diamond T/EM Anomaly 20 447850 7443383 695 -60 180 60 10/07/2023 Totals 1448 Table 2 (above) Location of Drill Holes at Alice Springs G e n e s i s R e s o u r c e s L i m i t e d | 2 0 2 4 A n n u a l R e p o r t P a g e | 10

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