IGO Interactive Annual Report 2019

DIRECTORS’ REPORT 30 JUNE 2019 Nova and Tropicana’s underlying EBITDA were up on the previous year, primarily due to the higher revenue. The Long and Jaguar Operations were placed into care and maintenance and divested in FY18 respectively, and as such there was limited to no contribution towards the Groups underlying EBITDA in FY19. Exploration and evaluation expenditure increased by $17.2 million in FY19 as the Group ramped up its pursuit of an exploration discovery through numerous prospective targets in its portfolio of high quality belt scale tenement holdings. Corporate expenditure is up slightly due to additional technical support provided to operations and the investment revaluation of $6.9 million related to mark-to-market adjustment on listed investments. During the previous financial year, the Company sold a royalty to Dacian Gold Limited for $11.5 million. Net profit after tax (NPAT) for the year was $76.1 million, compared to $52.7 million in the previous financial year, as detailed in the chart below. A$M 350 300 250 200 150 100 50 0 Underlying EBITDA Net finance costs Depreciation & amortisation Gain on sale of subsidiaries Income tax expense Net profit after tax 341 (1) (237) (29) 76 3 Depreciation and amortisation expense of $237.1 million (FY18: $252.1 million) was down slightly on the previous financial year due to the absence of Jaguar Operation and Long Operation from the Group, offset by an increase in Tropicana due to higher ore mined during the year. Net finance costs of $0.7 million were lower than the previous year as the Group builds its cash reserves and has moved to a positive net cash position, generating more interest income. Below is a reconciliation of Underlying EBITDA to NPAT for FY19: 300 53 151 42 (102) (27) (25) 15 (2) (17) (7) (11) 9 (3) 76 250 200 150 100 50 0 A$M Corporate & other NPAT FY18 Volume variance Price Variance Costs of Production variance Jaguar EBITDA variance Long EBITDA vairance D&A Exploration & evaluation expense MTM of investments Gain on sale of Assets Net finance costs Income tax expense NPAT FY19 NPAT VARIANCE FY19 VS FY18 IGO ANNUAL REPORT 2019 — 39