Announcement PDF Investigator Resources Limited ABN 90 115 338 979 Half Year Financial Report - 31 December 2023 Investigator Resources Limited Contents 31 December 2023 Corporate directory Directors' report Auditor's independence declaration Statement of profit or loss and other comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Notes to the financial statements Directors' declaration Independent auditor's review report to the members of Investigator Resources Limited 1 2 3 15 16 17 18 19 20 28 29 Investigator Resources Limited Corporate directory 31 December 2023 Directors Richard Hillis – Non-Executive Chair Andrew McIlwain – Managing Director Andrew Shearer – Non-Executive Director Company Secretary Ms Anita Addorisio Principal place of business 47 King Street Norwood SA 5067 Share register Computershare Limited Level 5, 115 Grenfell Street Adelaide SA 5000 Auditor Grant Thornton Audit Pty Ltd Level 3, 170 Frome Street Adelaide SA 5000 Solicitors Baker & McKenzie L19, CBW, 181 William Street Melbourne VIC 3000 Stock exchange listing Investigator Resources Limited shares and options are listed on the Australian Securities Exchange (ASX code: IVR and IVRO) Website Website: www.investres.com.au 2 Investigator Resources Limited Directors' report 31 December 2023 The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Investigator Resources Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2023 (the 'financial half-year' or the 'interim reporting period'). Directors The following persons were Directors of Investigator Resources Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated: Richard Hillis - Non-Executive Chair Andrew McIlwain - Managing Director Andrew Shearer - Non-Executive Director Principal activities The principal activity of the Group during the year was mineral exploration. 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 $739,327 (31 December 2022: $857,372). The net result for the financial half-year includes receipts of interest and other income of $85,954 (31 December 2022: $46,489). During the period, the Company incurred $2,303,435 expenditure on exploration activities across the Company’s tenements, compared to $2,628,915 for the prior corresponding period. The exploration activity spend includes resuming its exploration activities across the Uno Range and Morgans tenements in addition to the continuing work undertaken on advancing the Paris Silver Project during the prior corresponding period. In the current period, the Company's spend was mainly towards Paris Silver Project along with the continuing work undertaken on other tenements, as detailed in the project summary within this report. At 31 December 2023, the Company had a cash position of $5,511,442. 3 Investigator Resources Limited Directors' report 31 December 2023 The main activities during the half year included: Paris Silver Project The Company’s 100% owned Paris Silver Project is located approximately 70km north of the rural township of Kimba on South Australia’s Eyre Peninsula. Access to the project site is predominantly via highways and sealed roads and is approximately 7 hours by road from Adelaide, as can be seen in the figure below. Figure 1: Locality map showing Investigator’s SA tenements and Paris Silver Project – approximately 535km by road, NW of Adelaide. One of the highest grade undeveloped primary silver projects in Australia, the Paris Silver Project hosts a JORC (2012) compliant Mineral Resource Estimate of 24Mt @ 73g/t silver and 0.41% lead for 57Mozs silver and 99kt lead at a cut-off of 25g/t silver1. Paris is a shallow, high-grade silver deposit amenable to simple open pit mining and currently in the process of undergoing Definitive Feasibility Study (DFS) studies to evaluate the project in advance of any future development decision. 1 - As announced to the ASX on 5 July 2023 4 Investigator Resources Limited Directors' report 31 December 2023 Paris Definitive Feasibility Study Following on from completion of the updated Paris Silver Project Mineral Resource Estimate (ASX: 5 July 2023) the Board of Investigator initiated a number of additional programs of work to inform a Definitive Feasibility Study on Paris to be completed during the first half of 2024. Table 1: 2023 Paris Silver Project Mineral Resource Estimates Notes to be read in conjunction with the MRE above:  Based on 25g/t silver cut-off grade.  Values may not sum due to rounding.  Density: Indicated - 2.25t/m3, Inferred - 2.39t/m3 and Average - 2.30t/m3  The Company confirms that it is not aware of any new information or data that materially affects the Paris Silver Project Mineral Resource, since its release in July 2023. The 2021 Pre-Feasibility Study (PFS)2 highlighted the low-risk nature of the high-grade, near surface, open pit project with the Base Case Scenario (“Whole of Ore Leach”) assuming a simple processing circuit with robust silver recoveries. Importantly, this Base Case contemplated only recovery of silver with no revenue contribution from the substantial lead contained in the resource included. During the half-year period, work was undertaken to advance the Definitive Feasibility Study in the following areas. Environmental In the September Quarter 2023 Investigator Resources appointed JBS&G to commence a program of work to satisfy the environmental requirements for the proposed Paris Silver Project Mining Lease application with the South Australian regulators at the Department for Energy and Mining. JBS&G undertook a gap analysis of the existing project reports and data held by Investigator and identified a number of key areas where additional data collection would greatly assist in assessing the Project’s environmental risk and streamline the approvals process. One work component saw the completion of a comprehensive flora and fauna survey covering the Project’s proposed footprint. Whilst a detailed baseline study had been completed in 2013, the 2023 survey closed off a number of important aspects, including allowance for seasonal variation (a spring survey), in addition to acknowledging recent changes in the Federal Environment Protection and Biodiversity Conservation Act and the Native Vegetation Act and Native Vegetation Regulations (2017), as well as declared plants under the Landscape South Australia Act (2016). The updated flora and fauna survey values were reported to be generally consistent with those observed and reported within the 2013 baseline survey. No critical habitats for any nationally threatened species were reported as observed within the project footprint, and habitat for state threatened species was widespread and regarded by the ecologists as unlikely to be impacted by the project footprint or cause a reduction in species distribution. Additional environmental components of work are ongoing, including weather, baseline dust monitoring, baseline noise studies and additional soil geochemical baseline data for key project footprint areas that will provide valuable support in a Mining Lease application for the Project. Metallurgy Metallurgical studies to optimise lead recovery and process plant design continued during the half-year period and are in the final phases of test work prior to consideration of changes to the proposed process flowsheet. Importantly, the PFS was undertaken on a silver only processing stream, the ability to identify and quantify what lead may be able to be recovered from Paris as part of the DFS study will have important impacts on the process, mining and financial metrics for the project. 2 - As announced 30 Nov 2021 5 Investigator Resources Limited Directors' report 31 December 2023 Outcomes from this lead recovery study will assist additional major milestones for the project, including mine design, optimisation and scheduling, in addition to financial outputs of the study and is anticipated to be completed in early 2024. An additional series of metallurgical samples were selected and aimed at assessing the variability within the Paris deposit. “Like populations” were identified utilising the substantial geochemical dataset for the deposit and utilising X-Ray Diffraction mineralogy. Machine learning was used to identify cluster populations of mineralisation having different gangue (or waste) composition. Leach test work on these different clusters will allow metallurgical consultants to determine the relative effect each different gangue composition may have on recovery in addition to grind and chemical/reagent use. This work will provide confidence in the processing model and allow for any identified variability to be accounted for in design, scheduling and financial modelling. This variability study is expected to be completed in early 2024. Hydrology Investigator completed a hydrological drilling program to determine the hydrological conditions surrounding the Paris deposit, in addition to evaluating the Hector Paleochannel as a potential process water supply option for the project in the second half of 2023, with data gathered from this body of work used in modelling of the Paris open pit hydrology, during the half-year period. This body of work is in its final stages of review. The final outputs from the Paris hydrology study will provide model estimates on water volume from staged pit dewatering activities. This information will be utilised within the site water budget, with the objective of utilising the open pit water, minimising additional water requirements for process plant use. Modelling of the Hector Paleochannel is also in final stages of review. This phase of work was focussed on demonstrating that the previously identified water source had the capacity to support required volumes throughout the lifetime of the project for processing and ancillary purposes without a detrimental effect on the regional water table. These outputs will similarly be used to construct a water budget for the project. Geotechnical Studies A review of draft geotechnical modelling which was completed during the half-year period by independent consultants, Neboro is underway and this work will form the basis of future mine optimisation and design work as part of the DFS. It is expected that finalisation of this work will be dependent on additional review of hydrological outputs discussed briefly above. Engineering Design and Cost Estimation During the half-year period, Investigator identified additional consultants to assist in engineering design aspects of both Plant and Mine and Civil operational aspects, in addition to cost estimation and financial modelling components. These bodies of work will be developed over coming months once impacts of the Lead and Silver recovery study are known. Community Engagement with local and broader communities, as well as with the associated regulatory bodies also forms a vital element of the DFS. Investigator recognises that best practice environmental management and strong support from the community are critical to the Project’s success. Dialogue with the Gawler Ranges Aboriginal Corporation (GRAC) continue with the objective of negotiating the Native Title Mining Agreement (NTMA) necessary for the production phase of the Paris Project. GRAC are key stakeholders in the advancement of Paris, and it is intended that they will also be beneficiaries of the Project’s successful development. It is anticipated that the Paris Silver Project’s Definitive Feasibility Study will be completed and announced to the ASX in the first half of 2024. Molyhil Tungsten Project In November 2022 Investigator entered an heads of agreement to earn up to an 80% interest in the advanced Molyhil Tungsten-Molybdenum Project in the Northern Territory3. Under the agreement expenditure of $1M on the Molyhil Project gives Investigator the right to a 25% interest in Molyhil and surrounding exploration tenure, and 40% of the adjacent Bonya tenement. Two further stages of expenditure of up to $7M over 6 years give the ability to earn an 80% Molyhil project interest. 3 - As announced to the ASX – 24 Nov 2022 – “IVR enters Earn-In Agreement over Molyhil Tungsten Project 6 Investigator Resources Limited Directors' report 31 December 2023 The Molyhil Project is located approximately 230km northeast of Alice Springs, just off the Plenty Highway, as seen in Figure 1. The project has historic mine production (1980’s) and substantial project study work by Thor Energy PLC. The Molyhil TungstenMolybdenum Project has an existing Mineral Resource Estimate of 4.38Mt at 0.27% WO3 and 0.10% Mo for 11.8kt WO3 and 4.4kt Mo (JORC 2012)4 and positive Definitive Feasibility Study5 results which saw the project granted Major Project Status6 by the NT Government. Figure 2: Location of Molyhil in the NT With Major Project Status granted, and two critical minerals, Molyhil is set to benefit from streamlined regulatory approvals, in addition to exposure to potential funding opportunities given the strategic importance of these minerals, reinforcing the project’s path towards a future potential mining operation. Work completed during the half-year period included a significant amount of approvals and logistical planning in advance of Investigators maiden resource drill program at Molyhil. Table 2: Molyhil MRE classification as reported by Thor Energy to the ASX on 8 April, 2021. Molyhil Resource Drill Program Thirteen diamond drill holes were drilled for a total of 1,350m during November and early December 2023. Drilling design was undertaken in consultation with the Company’s independent mineral resource estimation consultant engaged for this project work. All drill core was comprehensively logged in the field, including sample markup prior to dispatch for core cutting and sample preparation. Samples for the program were subsequently freighted to Investigator’s preferred independent laboratory for analysis for tungsten, molybdenum and a comprehensive suite of additional elements. All samples are in the process of being tested, with results anticipated to be returned during February 2024. In tandem with this work, Investigator’s geologists are working through detailed QA/QC analysis and documentation to support the pending updated Mineral Resource Estimate. This work includes geological reinterpretation, documentation and evidence support of procedures, in addition to eventual analysis of twinned historic holes, analytical standards and similar aspects. On completion of this body of work (shortly after receipt of final assay data), the independent resource consultant will undertake a re-estimation of the Molyhil Mineral Resource. The results of this work will provide the Investigator Board a base to consider future investment timing in the project. 4 - As reported by THR to the ASX – 8 Apr 2021 5 - As reported by THR to the ASX – 23 Aug 2018 6 - As reported by THR to the ASX – 6 Jul 2020 7 Investigator Resources Limited Directors' report 31 December 2023 Molyhil Metallurgical Review During the half-year period, Investigator engaged consultant metallurgists experienced in tungsten processing to undertake a review of prior metallurgical process work undertaken by Thor Energy Plc. This review was aimed at identification of any potential process opportunities to exploit, as part as an initial gap analysis. This work is not yet complete, but is expected to be available for consideration by Investigator’s Board at the time that future investment decision is made when the updated Mineral Resource Estimate is announced. Co-funded Gravity Survey During the half-year period a gravity survey, co-funded by the NT Government, was completed at Molyhil, marking a significant step in refining the exploration strategy. A total of 3,506 gravity stations were completed. Other than a broad spaced historic coverage (2km x 2km), no detailed gravity surveys have been undertaken across the Molyhil Project or the surrounding area. The survey, conducted on spacings varying from 200m x 100m, down to 20m x 40m in some areas, will provide high resolution gravity data over the Molyhil deposit and its surrounding area, as shown in Figure 3. Early in Investigator’s due diligence review, observations of strong density contrast between geological sequences within the Molyhil Deposit, and due to dense tungsten/molybdenum mineralisation, saw a proposal developed to complete gravity surveying within the tenement as a method to map geological units under cover, and identify areas of particularly high density that may represent additional, undiscovered mineralisation. Figure 3. Location of the Molyhil project over regional 2km x 2km spaced gravity data. Note the Molyhil Project is on the margin of a large gravity low anomaly. As at the time of reporting, all gravity data and collection reports have been received by Investigator, with data levelling and modelling activities being undertaken by the company’s consultant geophysicist. The results of this survey, including additional target opportunities are expected to be reported in the March 2024 Quarter. 8 Investigator Resources Limited Directors' report 31 December 2023 Other Investigator Tenements Native Title Negotiations Investigator have been successful in applying for and being granted a number of tenements within the East Eyre and Stuart Shelf regions over the past 2 years. In order to undertake exploration activities, there has been a requirement to negotiate to add tenements to existing NTMA’s or negotiate new agreements to allow exploration activity on ground to occur. Tenements requiring this included Siam, Lake Macfarlane, Wartarka, Harris Bluff, Corunna, Yardea, Nonning South, Uneroo and Kootaberra. Three differing Aboriginal Corporations either cover a part or whole of the tenements listed above and have been engaged with by Investigator to allow exploration to commence. A meeting and presentation with the Kokatha Aboriginal Corporation (RNTBC) (KAC) Registered Native Title Board (RNTBC) was held during the half-year period. Following the presentation by Investigator, the KAC members and board voted to allow a number of new tenements in this region to be added to the existing NTMA agreement between Investigator and KAC. This agreement has significantly streamlined Investigator’s ability to explore on the ground in these areas, where part of the KAC determination area. These tenements include Kootaberra, Uneroo and Lake Macfarlane (part). Additional new tenements within the East Eyre and Stuart Shelf areas were also incorporated into a new NTMA with the Gawler Ranges Aboriginal Corporation (GRAC) RNTBC, similarly opening opportunity to undertake on ground exploration. Tenements added to the GRAC NTMA include Siam (part), Nonning South, Yardea and Harris Bluff. Negotiations are pending for Corunna, Wartarka, Siam (part) and Lake Macfarlane (part) with the Barngarla Determination Aboriginal Corporation (BDAC) RNTBC and will continue to be pursued by Investigator. Investigator Resources would like to acknowledge all of the Aboriginal groups on whose land we live and work. Wartarka/Lake Macfarlane/Uneroo/Siam EL’s In addition to NTMA negotiation, significant review of legacy data has occurred, combined with the planning for field activities on a series of areas that are accessible with new agreements in place. Initial field orientation and targeted soil sampling in a number of identified areas will occur in early 2024 where agreements are in place. As a result of these data reviews, an additional tenement to the west of Lake Macfarlane, named Nonning was applied for, after identifying evidence of prospectivity for lead, zinc and copper within historic exploration records. Curnamona Limited work occurred in the Curnamona area during the half-year period due to high workload on other project areas. The company has compiled all recent soil and rock chip data from the Curnamona project area, in addition to drone magnetics and is in the process of development of drill target prioritisation for review. Uno Range/Morgans/Harris Bluff/Nonning South/Yardea EL’s During the half-year period, the major component of work was negotiation of a new NTMA covering these tenements with the GRAC. This has allowed work on Nonning South and Yardea to commence, with a first phase of mapping and reconnaissance soil sampling completed during the half-year period. Results of the soil sampling are in the process of being reviewed to prioritise additional early evaluation of these two tenements. Additional follow up evaluation of the Uno Range/Morgans and Harris Bluff tenements has been delayed due to high workload at Paris and Molyhil. Reviews of prior drilling and a small program of additional soil coverage has taken place and proposals for additional follow up drilling are being reviewed. Fowler Domain During the half-year period Osmond Resources completed a helicopter supported gravity survey on IVR’s 100% owned Fowler Domain tenements that are subject to a Earn-In to Joint Venture agreement. Osmond have announced that the recently completed gravity survey has been modelled and integrated with historic detailed aeromagnetic and VTEM survey data, identifying high priority targets for follow up exploration in 2024, which may involve follow up Moving-Loop Electro Magnetic (MLEM) survey and ultimately drill testing7. 7 - As reported by OSM – 19 Dec 2023 9 Investigator Resources Limited Directors' report 31 December 2023 Stuart Shelf As at the end of September, 2023, Gold Road Ltd (ASX:GOR) had spent approximately $2.5M in their earn-in to Investigators Stuart Shelf Tenements. Having satisfied the Stage 2 commitment of $2M, GRO have notified Investigator of their intention to form the 51:49 Joint Venture interest in the tenements. Application to transfer the 51% interest earned in the Joint Venture tenements to GOR has been lodged with the Department for Energy and Mining and is being processed. Tasmania – White Spur – EL2/2020 Investigator holds the White Spur exploration licence (EL2/2020) in the highly mineral endowed Mount Read Volcanic belt of North-West Tasmania. Identified through a “machine learning” or “neural analysis” exercise in targeting mineralisation similar to that at the significant Rosebery Mine (which has operated continuously from 1936, producing zinc, copper, lead and gold) and Henty Mine (produced approximately 1.3Moz since its commissioning in 1996), the 84km2 White Spur tenement lies immediately to the south of the Rosebery and historic Hercules zinc mines and west of, and adjacent to the Henty Mine. No significant exploration has been undertaken on the tenement since 2013 when the presence of thallium, a known vector to massive sulphide mineralisation, was reported. No additional work was undertaken during the half-year period by Investigator due to other high priority commitments. 10 Investigator Resources Limited Directors' report 31 December 2023 Corporate disclosure and reporting The status of Investigator’s tenements at 31 December 2023 are detailed in the table below: 11 Investigator Resources Limited Directors' report 31 December 2023 CORPORATE Business Risks Investigator’s operating and financial results and performance are subject to various risks and uncertainties, some of which are beyond Investigator’s reasonable control. Set out below are matters which the Group has assessed as having the potential to have a material impact on its operating and/or financial results and performance: (i) Fluctuations in external economic drivers including macroeconomics and metal prices: The consolidated entity’s primary focus is the advancement of its Paris Silver Project. Fluctuations in the silver price can result from various aspects beyond Investigator’s control, including macroeconomic and geopolitical. Sustained lower silver prices would adversely impact the viability of the Project. (ii) Capital and Liquidity: The consolidated entity will incur expenditures over the next several years in connection with its exploration objectives and development of new projects and relies on its ability to raise capital as its primary source of funding. The company is exposed to the risk that unfavorable macroeconomic and market conditions would preclude it from raising sufficient capital. (iii) Failure to discover mineral resources and convert to ore reserves: Exploration activities are speculative in nature and often require substantial expenditure on exploration surveys, drilling and sampling as a basis on which to establish the presence, extent and estimated grade (metal content) of mineralised material. Even if significant mineralisation is discovered, it may take additional time and further financial investment to determine whether a mineral resource has attributes that are adequate enough to support the technical and economic viability of mining projects and enable a financial investment and development decision to be made. During that time the economic viability of the project may change due to fluctuations in factors that affect both revenue and costs, including metal prices, foreign exchange rates, the required return on capital, regulatory requirements, tax regimes and future cost of development and mining operations. (iv) Renewal of tenements: The consolidated entity has been granted tenements by the South Australian Department for Energy and Mining (‘the Department’) on the terms and conditions set out in the related lease agreements. At the expiry of the lease term, the decision of renewal application to assign tenements to the consolidated entity remains with the Department. A non-renewal of a tenement would adversely affect the operational results and fulfilment of the aspirations of the consolidated entity. (v) Failure to attract and retain key employees: The consolidated entity is heavily dependent for its continued operational success on its ability to attract and retain high calibre personnel to fill roles including Directors, Managing Director, Exploration Manager and geologists. A loss of key personnel or a failure to attract appropriately skilled and experienced personnel could affect its operations and performance. Business Development The Company continues to review opportunities for access to and or acquisition of projects within the domestic precious metals area, with a target profile of late-stage exploration through pre-development to production. The Investigator team has continued to actively review and assess acquisition opportunities. Whilst market conditions are such that identifying potential acquisitions with compelling accretive value prospects is challenging. We, the Company remain committed to a disciplined process and evaluation in this pursuit. 12 Investigator Resources Limited Directors' report 31 December 2023 Corporate Placement On 13 December 2023, the Company announced that it had received firm commitments to raise $5 million through a share placement to raise $4 million from institutional and sophisticated investors (Placement) and a share purchase plan fully underwritten for $ 1 million. Funds raised will be used for the completion of the Paris Silver Project Definitive Feasibility Study (DFS), further exploration of the Peterlumbo tenement that hosts Paris and exploration activities across the Company’s 100% owned regional tenements. The Placement constituted the issue of 102 million new fully paid ordinary shares in the Company at 3.9c per share, being approximately a 15% discount to the last previously traded price of 4.6c per share. For every 2 shares subscribed for in the Placement, one listed IVRO option was issued with an exercise price of 6.3c per option, expiring in March 2025. Additionally, a share purchase plan (SPP) was offered to shareholders on the register on 12 December 2023. The SPP was fully underwritten to $1 million and was offered on identical terms to the Placement. For every 2 shares issued under the SPP, 1 listed option was also issued. In addition, the secondary purpose of the Prospectus provided for the issue of 51,282,052 Placement Options and 12,628,205 Broker Options following the Placement as announced on 19 December 2023 at a zero application price which were subject to shareholder approval. The SPP closed on 15 January 2024 and was oversubscribed raising approximately $1.72 million with a total of 44,145,453 shares and 22,072,816 IVRO options issued to subscribing shareholders. The 51,282,052 Placement Options and 12,628,205 Broker Options were approved at a shareholders meeting held on 25 January 2024 and issued on 30 January 2024. Competent Person Statement The information in this Half Year Report that relates to exploration results is based on information compiled by Mr. Jason Murray who is a full-time employee of the company. Mr. Murray is a member of the Australasian Institute of Mining and Metallurgy. Mr. Murray has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities 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. Murray consents to the inclusion in this report of the matters based on information in the form and context in which it appears. The information in this release that relates to Mineral Resources Estimates at the Paris Silver Project is extracted from the release