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) 1 Segment information (continued) (c) Segment revenue A reconciliation of reportable segment revenue to total revenue is as follows: 2020 $'000 2019 $'000 Total revenue for reportable segments 883,352 779,185 Other revenue from continuing operations 5,578 5,327 Total revenue 888,930 784,512 Revenues for the Nova Operation were received from BHP Billiton Nickel West Pty Ltd (BHP Billiton Nickel West), Glencore International AG and Trafigura Pte Ltd. Revenues for the Tropicana Operation were received from The Perth Mint, Australia and the Company's financiers via forward sales contracts. (d) Segment net profit before income tax A reconciliation of reportable segment profit before income tax to profit before income tax is as follows: 2020 $'000 2019 $'000 Segment profit before income tax 208,316 132,444 Interest revenue on corporate cash balances and other unallocated revenue 5,578 5,327 Fair value movement of financial investments 33,207 (6,915) Share-based payments expense (4,489) (3,123) Corporate and other costs and unallocated other income (20,710) (18,445) Borrowing and finance costs (2,765) (5,222) Depreciation expense on corporate assets (3,095) (1,205) Net gain on disposal of subsidiaries and other corporate assets 3,470 2,587 Total profit before income tax 219,512 105,448 (e) Segment assets A reconciliation of reportable segment assets to total assets is as follows: 2020 $'000 2019 $'000 Total assets for reportable segments 1,634,936 1,603,637 Unallocated assets: Deferred tax assets 119,734 180,237 Listed equity securities 107,759 27,531 Cash and receivables held by the parent entity 418,642 373,433 Office and general plant and equipment 11,959 5,431 Total assets as per the balance sheet 2,293,030 2,190,269 IGO Limited 11 Notes to the consolidated financial statements 30 June 2020 (continued) 1 Segment information (continued) (f) Segment liabilities A reconciliation of reportable segment liabilities to total liabilities is as follows: 2020 $'000 2019 $'000 Total liabilities for reportable segments 153,587 110,594 Unallocated liabilities: Deferred tax liabilities 141,787 137,912 Creditors and accruals of the parent entity 4,741 4,634 Provision for employee entitlements of the parent entity 4,779 3,480 Bank loans 56,937 84,589 Corporate lease liabilities 5,390 - Total liabilities as per the balance sheet 367,221 341,209 2 Revenue 2020 $'000 2019 $'000 Sales revenue from contracts with customers Sale of goods revenue 865,292 792,537 Shipping and insurance service revenue 4,925 5,336 870,217 797,873 Other revenue Interest revenue 6,096 5,877 Other revenue - 15 Provisional pricing adjustments 12,617 (19,253) 18,713 (13,361) Total revenue 888,930 784,512 (a) Recognition and measurement (i) Revenue from sale of goods Revenue from the sale of goods is recognised when control of the goods has passed to the buyer based upon agreed delivery terms. Sale of concentrates Revenue from the sale of concentrates is recognised when control has passed to the buyer based upon agreed delivery terms, generally being when the product is loaded onto the ship and bill of lading received, or delivered to the customer's premises. In cases where control of the product is transferred to the customer before shipping takes place, revenue is recognised when the customer has formally acknowledged their legal ownership of the product, which includes all inherent risks associated with control of the product. In these cases, the product is clearly identified and immediately available to the customer and this is when the performance obligation is met. The price to be received on sales of concentrate is provisionally priced and recognised at the estimate of the consideration receivable that is highly probable of not reversing by reference to the relevant contractual price and the estimated mineral specifications, net of treatment and refining charges where applicable. Subsequently, provisionally priced sales are repriced at each reporting period up until when final pricing and settlement is confirmed, with revenue adjustments relating to the quality and quantity of commodities sold being recognised in sales revenue. Provisionally priced sales for which price finalisation is referenced to the relevant metal price index have an embedded commodity derivative. The embedded derivative is carried at fair value through profit or loss as part of trade receivables. The period between provisional pricing and final invoices is generally between 30 to 90 days. IGO Limited 12 Notes to the consolidated financial statements 30 June 2020 (continued) 2 Revenue (continued) (a) R c gnition and measurement (continued) Sale of gold bullion Revenue from the sale of gold bullion is recognised when control of the inventory has transferred to the customer, being when the gold is credited to the metals account of the customers. It is at this point that control over the gold bullion has been passed to the customer and the Group has fulfilled its performance obligation under the contract. (ii) Revenue from Services - Shipping and Insurance Sales of nickel and copper concentrates are on terms that include the Group being responsible for shipping and insurance costs. Shipping and insurance is a separate performance obligation from the sale of the commodity with the revenue allocated to shipping and insurance being recognised over the period of transfer to the customer. (iii) Provisional pricing adjustments 82 — IGO ANNUAL REPORT 2020 IGO ANNUAL REPORT 2020— 83