2021 Annual Report

Directors’ Report 30 June 2021 • Kimberley (nickel-copper-cobalt) – the Kimberley Project is targeting Nova-style nickel-copper-cobalt sulphide mineralisation in the Paleoproterozoic belts of the West and East Kimberley. During the year, the next JV earn-in stage was reached for the West Kimberley Regional JV with Buxton Resources, with IGO now holding an 80% interest in these tenements. In the East Kimberley, the compilation and reprocessing of open file geophysical data was completed and the digitising of open file geochemical data continued. In late FY21, on-ground exploration commenced in the Osmond Valley area. • Lake Mackay (copper-nickel-cobalt-gold) – Lake Mackay is a JV between IGO, Prodigy Gold NL and Castile Resources Pty Ltd (in parts) covering 15,630km 2 of tenements straddling the Northern Territory and Western Australian border. During the year, RC and DD programs were completed at the Phreaker Prospect. One DD hole intersected significant copper-gold- silver mineralisation which may require follow-up in FY22. FINANCIAL OVERVIEW FY21 was another successful year for IGO both from an operational and financial perspective, with performance from the operations combined with strong commodity prices and positive industry sentiment. Robust performance at the Nova Operation continued, and up until its divestment Tropicana was also a key contributor to the Company’s financial success for the period. From a financial performance perspective, the Group’s Board and management monitor underlying EBITDA (calculated as profit before tax adjusted for finance costs, interest income, gain on sale of investments and subsidiaries, acquisition and transaction costs, foreign exchange and hedging gains/losses attributable to the acquisition of Tianqi and depreciation and amortisation). This measure represents a useful proxy for measuring an operation’s cash generating capabilities. The Company achieved record revenue and underlying EBITDA for the third year in a row, generating total revenue and other income of A$918.7 million and underlying EBITDA of A$474.6 million. Due to the divestment of Tropicana, we report revenue from continuing and discontinued operations. Revenue from continuing operations (comprising primarily the Nova Operation) of A$671.7 million was a 12% increase on the prior year result of A$598.9 million. This was predominantly due to stronger base metal prices and higher payabilities following the renegotiation of Nova Operation’s concentrate offtake agreements during FY20. Nova continued strong operational performance, exceeding guidance range on all metals. Revenue from discontinued operations (Tropicana) was A$243.3 million, a 16% decrease primarily due to lower grade mined and milled during the period. Profit from discontinued operations for the current year of A$431.9 million reflects the results of the Tropicana Operation up to its divestment on 31 May 2021, including the gain on the sale of the Operation. The Group recognised a gain on the sale of Tropicana after income tax of A$384.8 million. All results referred to in this Director’s Report reflect Tropicana’s results up to 31 May 2021. Underlying EBITDA increased relative to the previous financial year, as can be seen in the following chart: A$M Underlying EBITDA FY21 A$475M FY20 A$460M Nova Operation Tropicana Operation Exploration and evaluation expense Corporate and other expenses Investment revaluation Share-based payments expense (non-cash) 436 122 256 351 175 10 33 (64) (73) (25) (22) (5) (4) 0 400 150 100 450 500 350 300 250 200 (50) (100) (150) 40 —IGO ANNUAL REPORT 2021