IGO Interactive Annual Report 2020

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2020 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2020 Notes to the consolidated financial statements 30 June 2020 (continued) 24 Commitments and contingencies (continued) (c) Gold delivery commitments Gold for physical delivery oz Average contracted sale price A$/oz Value of committed sales $'000 Within one year 55,800 1,845 102,942 Later than one but not later than two years 54,288 2,089 113,426 Total 110,088 1,965 216,368 The physical gold delivery contracts are settled by the physical delivery of gold as per the contract terms. The contracts are accounted for as sales contracts with revenue recognised once gold has been delivered to the counterparties. The physical gold delivery contracts are considered to sell a non-financial item and therefore do not fall within the scope of AASB 139 Financial Instruments: Recognition and Measurement. Hence, no derivatives have been recognised in respect of these contracts. (d) Contingencies The Group had guarantees outstanding at 30 June 2020 totalling $1,211,000 (2019: $1,131,000) which have been granted in favour of various third parties. The guarantees primarily relate to environmental and rehabilitation bonds at the various mine sites. 25 Events occurring after the reporting period The impact of the COVID-19 pandemic is ongoing and, while it has had limited impact on the Group up to 30 June 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation continues to develop and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. On 27 August 2020, the Company announced a final unfranked dividend of 5 cents per share, to be paid on 25 September 2020. Other than the above, there has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity, in future financial years, other than as stated elsewhere in the financial report. 26 Share-based payments The Group provides benefits to employees (including executive directors) of the Group through share-based incentives. Information relating to these schemes is set out below. (a) Employee Incentive Plan The IGO Limited Employee Incentive Plan (EIP) was approved by shareholders at the Annual General Meeting of the Company in November 2016. The EIP incorporates both broad based equity participation for eligible employees, as well as key executive incentive schemes designed to provide long-term incentives to senior management (including executive directors) to deliver long-term shareholder returns. The EIP comprised the following schemes during the current financial year: • Long-term incentive (LTI) - performance rights; • LTI - service rights; • Employee share ownership award; and • Employee salary sacrifice share plan. Notes to the consolidated financial statements 30 June 2020 (continued) Other information This section of the notes includes other information that must be disclosed to comply with the accounting standards and other pronouncements, but are not considered critical in understanding the financial performance or position of the Group. 24 Commitments and contingencies (a) Capital commitments Significant capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows: 2020 $'000 2019 $'000 Mine properties in development 4,125 30,666 4,125 30,666 (b) Leasing Commitments 2020 $'000 2019 $'000 Operating lease commitments Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows: Within one year - 6,272 Later than one year but not later than five years - 20,433 Later than five years - 11,340 Total minimum lease payments - 38,045 2020 $'000 2019 $'000 Finance lease commitments Future minimum lease payments under lease contracts with the present value of net minimum lease payments are as follows: Within one year 7,706 - Later than one year but not later than five years 27,862 - Later than five years 9,485 - Total minimum lease payments 45,053 - Future finance charges (5,268) - Present value of minimum lease payments 39,785 - Current 6,235 - Non-current 33,550 - Total included in lease liabilities 39,785 - 116 — IGO ANNUAL REPORT 2020 IGO ANNUAL REPORT 2020— 117