MMG Limited

Annual Report 2023 HKEX 1208

We mine to build wealth Our vision is to create a
through the development of leading international mining
our people, partnering with company for a low carbon
local communities to drive future.
economic growth and the value
we deliver to our shareholders.

We work in complex A long-term outlook, our pride

jurisdictions and across in mining our commitment to
numerous cultures and international standards and our
communities, who have vastly respect for people, land and
differing experiences with culture underpin our success.
resource development.
 Contents
Chairman’s Letter 2

Chief Executive Officer’s Report 4

Mineral Resources and Ore Reserves 7

Management Discussion and Analysis 20

Directors and Senior Management 58

Directors’ Report 63

Corporate Governance Report 83

ESG Approach and Performance 97

Independent Auditor’s Report 110

Financial Statements 116

Glossary 206

Corporate Information 209

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Chairman’s
Letter

Dear Shareholders,
The need for minerals that are
I am pleased to present the 2023 Annual Report
which is my first as the Chair of the Company. After
critical to the energy transition
six years on the Executive Committee and as a will continue to grow and evolve
Director since May 2009, I am delighted to have the
opportunity, together with the Management Team, and will require many sources
to drive the future success of the business. of investment, technology and
Safety, our first value manufacturing capability - with
First, let me start with our safety performance. China to remain a key partner.
At MMG, safety is our first value and we continue
to place significant effort on eliminating fatalities As a producer with a commitment to the highest
and serious injuries from our workplaces. operating standards, and as an active member of
the International Council on Mining and Metals,
However, I am deeply saddened by the deaths of MMG remains an important international growth
Barminco contractors Mr Trevor Davis and Mr Dylan platform for our major shareholder, China Minmetals
Langridge at Dugald River in February 2023. I offer my Corporation (CMC).
sincere condolences to their families and friends. This
incident serves as a sad and lasting reminder of the CMC’s support has enabled us to enter into a Share
paramount importance of safety, and our commitment Purchase Agreement to acquire the Khoemacau Mine
to eliminate injuries and fatalities across MMG. in Botswana in November 2023. This acquisition
reaffirms our commitment to build a portfolio of high-
In 2024, we will maintain a close focus on learning quality mines and aligns to our vision of creating a
from incidents and particularly significant events leading international mining company for a low carbon
with energy exchange. We will continue to take a future. Khoemacau is a high-quality operating mine
proactive approach to risk management and field task with a very robust expansion case and is located in
observations to ensure that we are actively reducing one of the most prospective mining regions in Africa,
risks for our people. Nothing is more important than the Kalahari Copperbelt. This acquisition is closely
ensuring our people can return home safely to their aligned to our strategy of delivering long-term value
families and friends. for shareholders by pursuing value-accretive external
opportunities while continuing to focus on pursuing
Strategy and portfolio organic growth opportunities across our existing
While 2023 has presented challenges with price asset base.
fluctuations in our core commodities, the medium and Across the entire MMG portfolio we have also
long-term outlook for our products remains very strong. continued to focus on growth drilling and on
Global trends such as urbanisation, decarbonisation progressing the key development projects which
and electrification will continue to drive demand for include the Chalcobamba development at Las Bambas
copper and zinc. China also remains deeply committed and the Kinsevere Expansion Project (KEP). I am
to a strong decarbonisation agenda domestically and is pleased to report that we have made steady progress
actively advancing clean energy technologies which are on both throughout 2023.
very supportive of the mining sector.

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 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

XU Jiqing
Chairman

In Peru, we have worked closely with the Government Executive General Manager Australia and Africa,
of Peru and community members in transparent and has been appointed and commenced in this role
constructive dialogue. Discussions with the Huancuire on 1 February 2024.
community have continued to progress and we have
A new position of Executive General Manager –
signed agreements with a number of community
Commercial and Development has been created to
companies which have been able to commence early
focus on strategy, projects, mergers and acquisitions
works at Chalcobamba. While we have not yet reached
with the Interim Chief Executive Officer performing this
final agreements with the community, we remain
role until the recruitment process is completed.
positive regarding progress as we work together to
share the success of Las Bambas. On behalf of the Board, I extend my gratitude to
Mr Carroll for his valuable contributions to the
The construction of the Kinsevere Expansion Project,
Company since he joined MMG in late 2015.
which will enable us to transition to mining sulphide
ores and introduce cobalt into our product portfolio,
Conclusion
remains on track. We were pleased to celebrate the
commissioning of the cobalt plant in the fourth quarter Finally, in 2024 we will continue to focus our efforts on
of the 2023, having achieved the first production of driving strong operational performance and excellence
Kinsevere’s cobalt hydroxide. The new tailings storage in project delivery across the business.
facility at site was also commissioned to support
Our success would not be possible without our people
cobalt production and progress has been made in the
or the support of our shareholders. On behalf of the
installation of the concentrator and roaster as well
Board, I extend my gratitude to our people for their
as the gas cleaning and acid plant to support copper
commitment and contributions and we thank our
production from sulphide ore.
shareholders, partners and communities for their
Executive team changes ongoing support.

In February 2024, we welcomed the appointment

of Mr Song Qian as the Executive General Manager
Finance, following the retirement of Chief Financial
Officer Mr Ross Carroll who will depart the business XU Jiqing
in July 2024. Chairman

Mr Qian brings to MMG significant experience within

CMC where he has held a number of senior executive
roles, most recently as the Chief Financial Officer of
Minmetals Innovative Investments Co. He was also
employed by the Company from 2010 to 2012 and
has a strong understanding of the MMG business.

In early 2024, we further undertook a review of

executive portfolios and realigned a number of
executive accountabilities. As part of this process,
we have created a new role of Executive General
Manager Operations to integrate group operational
accountability and excellence. Mr Nan Wang, formerly

MMG Annual Report 2023 | 3

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Chief Executive
Officer’s Report

Dear Shareholders, Copper production at the Kinsevere mine was 10%

lower than in 2022 largely due to unstable power
I am pleased to present our 2023 Annual Report.
supply from the national grid. Construction of the
Kinsevere Expansion Project continues to advance
Safety
with the cobalt plant commissioned in the fourth
At MMG, our first value is safety. quarter.

In a tragic start to 2023 two people, employed through Zinc production at Dugald River mine was 12% lower
our mining contractor Barminco at our Dugald River than in 2022, due to the impact of suspension of
mine, lost their lives after a light vehicle they were operations in the first quarter.
travelling in fell into a stope on 15 February 2023.
Annual production at Rosebery mine was 1% above
The loss of Dylan Langridge and Trevor Davis has 2022 levels, largely driven by the mining sequence
had a profound impact on us all and our united focus with the ore mined and milled volume results in the
remains on doing everything we can to promote a safe fourth quarter the highest for the year.
workplace and culture and to ensure every person
returns safely home to their loved ones. Financial performance
MMG’s total recordable injury frequency (TRIF) was In 2023, MMG recorded a net profit after
1.97 for the full year 2023, which is higher than the tax of US$122.1 million, including a profit of
full year 2022 result of 1.25. We recognise there is US$9.0 million attributable to equity holders of the
still significant room for improvement – particularly in Company. This compared to a net profit after tax
reducing significant potential incidents - and during of US$243.5 million in 2022, including a profit of
the fourth quarter we saw a significant reduction in US$172.4 million attributable to equity holders.
injury rates.
Driven by strong cashflows, the Company reduced
net debt levels by US$783.6 million, lowering overall
Operational performance
gearing ratio by 5% to 50% at the end of 2023.
Overall, our sites have delivered strong results with
Pleasingly, revenue increased by US$1,092.3 million
production and cost performance, in line with or
(34%) for the period, primarily driven by higher sales
exceeding our updated guidance.
volumes from Las Bambas, which more than offset the
In 2023, MMG produced 347,264 tonnes of copper impact of lower copper and zinc prices.
(copper cathode plus copper in concentrate) and
203,470 tonnes of zinc (zinc in concentrate). Delivering growth
Copper production in 2023 was 14% higher than
in 2022 driven by uninterrupted operations at Las
In 2023 we also achieved
Bambas. This result further demonstrates the site’s a major milestone having
strong operational performance throughout the
year which included achieving a record in milled ore entered into a Share Purchase
throughput and the second highest annual sales Agreement to acquire the
volume, with over 1.1 million tonnes of concentrate sold.
Khoemacau Mine.

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 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

LI Liangang
Chief Executive Officer (Interim)

The Khoemacau Mine is a large, long-life copper treasury systems and a strong understanding of
mine located in northwest Botswana, in the emerging commercial and investment banking, financial markets,
Kalahari Copperbelt. The tenement package hosts and cross-cultural integration in mining assets and
the tenth largest African copper mineral resource by multi-industrial assets within China and internationally.
total contained copper metal and is one of the largest
Additional changes to the Executive Team include a
copper sedimentary systems in the world outside of
rebalancing of responsibilities with the creation of
the Central African Copperbelt.
the role of Executive General Manager Operations
Commitment to sustainability to integrate group operational accountability and
operational excellence. Mr Nan Wang, formerly
I am proud that the minerals we produce are essential Executive General Manager Australia and Africa, was
to ensuring that we can successfully transition to appointed to this role and commenced on 1 February
a more sustainable world. MMG plays a key role in 2024. Mr Troy Hey, the Executive General Manager
providing these metals to our customers to drive the Corporate Relations, has taken accountability for the
development of green technology that will replace Legal and Company Secretary functions alongside his
fossil fuels. existing accountabilities.
As part of our commitment to achieve Net Zero we I am confident that the new structure will enable our
have set an interim 2030 target of reducing Scope 1 leadership to drive successful outcomes as we work
and Scope 2 operational greenhouse gas emissions towards our vision of creating a leading international
from our operated assets by 40%, from a 2020 company for a low carbon future.
baseline. This interim target aligns with science-based
methodologies, in line with ambitions set out in the Future focus
Paris Agreement.
As we look ahead to 2024, we are focused on securing
Growing our assets, while maintaining an unwavering the next stage of growth for our business.
commitment to sustainable development, is what
At Las Bambas, this means working closely with the
drives our business.
Huancuire community to progress the Chalcobamba
Executive committee changes development.

In January 2024, the Board announced that Mr Ross We will also continue to focus on advancing the
Carroll will retire from his role as the Chief Financial Kinsevere Development Project and the completion
Officer (CFO) of MMG and will depart the company on and subsequent integration of Khoemacau.
1 July 2024, following a transition period. Mr Carroll Across all operations we remain focused on safe and
was appointed as CFO of the Company in December stable production while adding value to our assets
2015. On behalf of everyone at MMG I would like to through expansion and life extension.
take this opportunity to express my sincere gratitude
to Mr Carroll for his valuable contribution to MMG over Thank you for your ongoing support of MMG.
many years.

Mr Song Qian joined MMG on 1 February 2024 as the

Executive General Manager Finance and brings to
the business significant executive experience within LI Liangang
CMC. He brings to MMG valuable experience in global Chief Executive Officer (Interim)

MMG Annual Report 2023 | 5

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Board of Directors

Mr XU Jiqing Mr LI Liangang Mr ZHANG Shuqiang

Chairman Executive Director Non-executive Director

Dr Peter CASSIDY Mr LEUNG Cheuk Yan Mr CHAN Ka Keung, Peter

Independent Non-executive Independent Non-executive Independent Non-executive
Director Director Director

Executive Committee

Mr LI Liangang Mr Song QIAN Mr Troy HEY

Interim Chief Executive Officer Executive General Manager – Executive General Manager -
Finance Corporate Relations

Mr WEI Jianxian Mr Nan WANG Mr Ross CARROLL

Executive General Manager – Executive General Manager – Retiring
Americas Operations

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Mineral Resources
and Ore Reserves

Executive Summary
Mineral Resources and Ore Reserves for MMG have been estimated as at 30 June 2023 and are reported in
accordance with the guidelines in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (2012 JORC Code) and Chapter 18 of the Listing Rules. Mineral Resources
and Ore Reserves tables are provided on pages 8 to 14, which include the 30 June 2022 and 30 June 2023
estimates for comparison. The Measured and Indicated Mineral Resources are inclusive of those Mineral
Resources that have been converted to Ore Reserves. All supporting data are provided within the Technical
Appendix, available on the MMG website.

Mineral Resources and Ore Reserves information in this statement have been compiled by Competent Persons
(as defined by the 2012 JORC Code). Each Competent Person consents to the inclusion of the information in
this report, that they have provided in the form and context in which it appears. Competent Persons are listed
on page 15.

MMG has established processes and structures for the governance of Mineral Resources and Ore Reserves
estimation and reporting. MMG has a Mineral Resources and Ore Reserves Committee that regularly convenes to
assist the MMG Governance and Nomination Committee and the Board of Directors with respect to the reporting
practices of the Company in relation to Mineral Resources and Ore Reserves, and the quality and integrity of
these reports of the Group.

Key changes to the Mineral Resources (contained metal) since the 30 June 2022 estimate relate to depletion1 at
all sites together with increased costs, increased metal price assumptions, cut-off grade increase and updates to
the models at all sites. Cost increases are the primary driver across the business. At Las Bambas, cost increases
account for 1,475kt of copper metal removed from the Mineral Resources. Results from drilling in Ferrobamba
pit have led to further reductions of about 380kt of copper metal. Increased metal price assumptions have only
partially offset the reductions. At Dugald River, updated estimates have added around 280kt of lead metal.
Rosebery has almost replaced milled depletion on a zinc equivalent basis despite upward cost pressures with
drilling success in Z and U lenses. Mining depletion has reduced the cobalt metal by around 30% at Kinsevere,
while the Mwepu Resource has increased 70% for copper.

Key changes to the Ore Reserves (contained metal) since the 30 June 2022 estimate are mostly related to
depletion1. At Rosebery, all metal has reduced by around 20% which is proportionate to mine life. Dugald
River milled depletion has almost been replenished by Resource to Reserve conversion. Las Bambas is mostly
impacted by changes to the model through drilling in Ferrobamba pit and costs partially offset by metal price
assumptions.

Following a favourable preliminary ruling by the International Chamber of Commerce in a preliminary arbitration
proceeding filed in Q4 2022, and engagement with La Générale des Carrières et des Mines S.A. (Gécamines) and
local authorities, the armed forces and third parties present on the Sokoroshe II and Nambulwa leases, left the
sites in late 2022. MMG re-established control of both sites shortly afterwards.

MMG is continuing to engage with Gécamines to resolve outstanding matters and conclude the legal processes
and to complete the renewal of the Kinsevere, Nambulwa and Sokoroshe II permits for a further 15 years. MMG
wishes to work with Gécamines to ensure a strong future for the Kinsevere asset, as well as maintaining its long-
standing relationship.

Pages 16 and 17 provide further discussion of the Mineral Resources and Ore Reserves changes.

1 Depletion in this report refers to material processed by the mill and depleted from the Mineral Resources and Ore Reserves through mining and
processing.

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Mineral Resources
and Ore Reserves
Continued

Mineral Resources1
All data reported here is on a 100% asset basis, with MMG’s attributable interest shown against each asset within
brackets.

2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Las Bambas (62.5%)
Ferrobamba Oxide Copper
Indicated 0.02 1.3 0.03 1.7
Inferred
Total 0.02 1.3 0.03 1.7
Ferrobamba Primary Copper
Measured 380 0.59 2.6 0.05 220 470 0.56 2.3 0.04 210
Indicated 220 0.66 3.2 0.06 180 270 0.70 3.3 0.06 180
Inferred 39 0.80 2.8 0.07 190 110 0.84 4.2 0.08 170
Total 640 0.63 2.8 0.05 200 850 0.64 2.9 0.05 190
Ferrobamba Total 640 850
Chalcobamba Oxide Copper
Indicated 6.2 1.4 6.8 1.4
Inferred 0.53 1.2 0.1 1.5
Total 6.7 1.4 6.9 1.4
Chalcobamba Primary
Copper
Measured 150 0.51 1.5 0.02 120 140 0.54 1.7 0.02 140
Indicated 190 0.60 2.2 0.03 120 180 0.64 2.5 0.03 110
Inferred 43 0.47 1.9 0.02 100 29 0.56 2.4 0.03 130
Total 380 0.55 1.9 0.02 120 340 0.60 2.1 0.03 120
Chalcobamba Total 387 347
Sulfobamba Primary Copper
Indicated 93 0.62 4.4 0.02 140 84 0.67 4.7 0.02 170
Inferred 110 0.54 6.0 0.02 64 98 0.58 6.5 0.02 120
Total 210 0.58 5.2 0.02 98 180 0.62 5.7 0.02 140
Sulfobamba Total 210 0.58 5.2 0.02 98 180 0.62 5.7 0.02 140
Oxide Copper Stockpile
Indicated 14 1.1 14 1.1
Total 14 1.1 14 1.1
Sulphide Stockpile
Measured 25 0.36 2.2 110 30 0.38 2.2 130
Total 25 0.36 2.2 110 30 0.38 2.2 130
Las Bambas Total 1,300 1,400

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Mineral Resources
and Ore Reserves
Continued

Mineral Resources1
2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Kinsevere (100%)
Oxide Copper
Measured 1.4 2.7 0.09 2.6 2.9 0.08
Indicated 4.3 2.5 0.10 4.4 2.6 0.12
Inferred 2.2 2.0 0.08 2.0 2.0 0.09
Total 8.0 2.4 0.09 9.0 2.6 0.10
Transition Mixed Copper
Ore
Measured 0.7 2.0 0.11 1.0 2.2 0.16
Indicated 2.1 2.0 0.11 2.5 2.0 0.12
Inferred 1.0 1.6 0.09 1.3 1.7 0.08
Total 3.8 1.9 0.10 4.8 1.9 0.12
Primary Copper
Measured 1.2 2.0 0.17 2.2 2.5 0.23
Indicated 17 2.3 0.09 18 2.2 0.10
Inferred 8 1.7 0.06 10.0 1.6 0.07
Total 26 2.1 0.09 31 2.1 0.10
Oxide-TMO Cobalt
Measured
Indicated 0.31 0.24 0.30 0.70 0.21 0.32
Inferred 0.40 0.16 0.31 0.73 0.16 0.33
Total 0.7 0.20 0.31 1.4 0.2 0.32
Primary Cobalt
Measured
Indicated 0.06 0.53 0.30 0.17 0.31 0.20
Inferred 0.10 0.29 0.30 0.24 0.26 0.22
Total 0.16 0.38 0.30 0.41 0.28 0.21
Stockpiles
Measured
Indicated 18 1.6 14 1.5
Total 18 1.6 14 1.5
Kinsevere Total 56 1.9 61 1.9

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Mineral Resources
and Ore Reserves
Continued
Mineral Resources1
2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Sokoroshe 2 (100%)
Oxide Copper
Measured
Indicated 2.7 2.1 0.39 2.8 2.1 0.39
Inferred 0.17 1.1 0.10 0.16 1.1 0.10
Total 2.9 2.1 0.37 2.9 2.1 0.37
Transition Mixed Copper Ore
Measured
Indicated 0.07 1.6 0.23 0.1 1.6 0.23
Inferred
Total 0.07 1.6 0.22 0.1 1.6 0.23
Primary Copper
Measured
Indicated 0.62 1.5 0.48 0.62 1.50 0.47
Inferred
Total 0.62 1.5 0.47 0.62 1.5 0.47
Oxide Cobalt
Measured
Indicated 0.64 0.24 0.52 0.63 0.24 0.51
Inferred 0.31 0.37 0.31 0.31 0.35 0.31
Total 0.95 0.28 0.45 0.93 0.27 0.45
Primary Cobalt
Measured
Indicated 0.05 0.54 0.65 0.05 0.53 0.64
Inferred
Total 0.05 0.54 0.65 0.05 0.53 0.64
Sokoroshe 2 Total 4.6 1.6 0.40 4.6 1.6 0.40
Nambulwa (100%)
Oxide Copper
Measured
Indicated 1.2 2.2 0.11 1.1 2.2 0.11
Inferred 0.12 1.7 0.07 0.10 1.9 0.07
Total 1.3 2.1 0.11 1.2 2.1 0.11
Transition Mixed Copper Ore
Measured
Indicated
Inferred
Total
Oxide-TMO Cobalt
Measured
Indicated 0.21 0.14 0.27 0.17 0.14 0.27
Inferred
Total 0.21 0.14 0.27 0.2 0.14 0.27
Nambulwa Total 1.5 1.9 0.13 1.4 1.9 0.13

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Mineral Resources
and Ore Reserves
Continued

Mineral Resources1
2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
DZ (100%)
Oxide Copper
Measured
Indicated 1.0 1.8 0.12 0.94 1.8 0.13
Inferred 0.05 1.9 0.11 0.04 1.9 0.12
Total 1.1 1.8 0.12 0.98 1.8 0.13
Oxide-TMO Cobalt
Measured
Indicated 0.34 0.2 0.27 0.33 0.22 0.27
Inferred 0.01 0.13 0.25 0.01 0.14 0.25
Total 0.35 0.22 0.27 0.33 0.22 0.27
DZ Total 1.4 1.4 0.16 1.3 1.4 0.16
Mwepu (100%)
Oxide Copper
Measured 0.37 2.0 0.15
Indicated 1.5 2.6 0.14 0.75 2.5 0.17
Inferred 0.38 2.3 0.02 0.45 2.7 0.29
Total 2.3 2.4 0.12 1.2 2.6 0.22
TMO Copper
Measured 0.05 1.3 0.13
Indicated 0.25 1.5 0.17 0.20 1.3 0.18
Inferred 0.10 1.9 0.03 0.18 1.4 0.22
Total 0.40 1.6 0.13 0.4 1.3 0.20
Oxide-TMO Cobalt
Measured
Indicated 0.08 0.6 0.40 0.04 0.71 0.45
Inferred
Total 0.08 0.6 0.40 0.09 0.69 0.45
Primary Cobalt
Measured
Indicated 0.12 0.32 0.44 0.07 0.25 0.31
Inferred
Total 0.12 0.31 0.44 0.27 0.26 0.39
Mwepu Total 2.9 2.2 0.15 2.0 1.9 0.25

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Mineral Resources
and Ore Reserves
Continued

Mineral Resources1
2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Dugald River (100%)
Primary Zinc
Measured 16 12.8 1.9 58 12 13.5 2.2 71
Indicated 13 11.3 1.4 16 15 12.0 0.9 16
Inferred 28 11.3 1.4 5.8 33 11.3 0.8 8
Total 57 11.7 1.6 23 61 11.9 1.1 23
Primary Copper
Inferred 4.8 1.6 0.2 4.5 1.5 0.1
Total 4.8 1.6 0.2 4.5 1.5 0.1
Dugald River Total 62 65
Rosebery (100%)
Rosebery
Measured 7.4 0.22 7.6 2.8 120 1.3 7.3 0.20 7.4 2.7 118 1.2
Indicated 4.7 0.21 7.1 2.0 83 1.2 4.6 0.18 6.9 1.9 75 1.1
Inferred 6.5 0.19 7.5 2.3 85 1.1 7.9 0.19 7.0 2.1 77 1.1
Total 19 0.21 7.4 2.4 99 1.2 20 0.19 7.1 2.3 92 1.1
Rosebery Total 19 20
High Lake (100%)
Measured
Indicated 7.9 3.0 3.5 0.3 83 1.3 7.9 3.0 3.5 0.3 83 1.3
Inferred 6.0 1.8 4.3 0.4 84 1.3 6.0 1.8 4.3 0.4 84 1.3
Total 14 2.5 3.8 0.4 84 1.3 14 2.5 3.8 0.4 84 1.3
Izok Lake (100%)
Measured
Indicated 13 2.4 13.3 1.4 73 0.18 13 2.4 13.3 1.4 73 0.18
Inferred 1.2 1.5 10.5 1.3 73 0.21 1.2 1.5 10.5 1.3 73 0.21
Total 15 2.3 13.1 1.4 73 0.18 15 2.3 13.1 1.4 73 0.18

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Mineral Resources
and Ore Reserves
Continued

Ore Reserves1
All data reported here is on a 100% asset basis, with MMG’s attributable interest shown against each asset within
brackets.

2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Las Bambas (62.5%)
Ferrobamba Primary Copper
Proved 310 0.63 3.0 0.05 220 340 0.65 2.9 0.05 200
Probable 130 0.73 3.9 0.07 190 130 0.91 4.6 0.08 180
Total 440 0.66 3.3 0.06 210 470 0.72 3.4 0.06 200
Chalcobamba Primary Copper
Proved 96 0.62 2.0 0.03 120 100 0.65 2.1 0.03 130
Probable 130 0.68 2.7 0.03 110 130 0.71 2.7 0.03 110
Total 220 0.66 2.4 0.03 120 230 0.68 2.4 0.03 120
Sulfobamba Primary Copper
Proved
Probable 57 0.77 5.8 0.03 159 54 0.80 5.9 0.03 160
Total 57 0.77 5.8 0.03 159 54 0.80 5.9 0.03 160
Primary Copper Stockpiles
Proved 25 0.36 2.2 110 30 0.38 2.2 130
Total 25 0.36 2.2 110 30 0.38 2.2 130
Las Bambas Total 740 0.66 3.2 170 780 0.70 3.2 170
Kinsevere (100%)
Oxide/TMO Copper and Cobalt
Proved 0.9 2.5 0.11 3.0 2.5 0.12
Probable 3.2 2.3 0.11 5.7 2.2 0.12
Total 4.1 2.3 0.11 8.6 2.3 0.12
Primary Copper and Cobalt
Proved 1.2 2.0 0.17 1.9 2.3 0.21
Probable 15 2.3 0.09 16 2.2 0.10
Total 16 2.2 0.10 18 2.2 0.11
Stockpiles
Proved
Probable 18 1.6 14 1.5
Total 18 1.6 14 1.5
Kinsevere Total 38 2.0 40 2.0
Sokoroshe 2 (100%)
Oxide Copper and Cobalt
Proved
Probable 2.5 1.9 0.42
Total 2.5 1.9 0.42
Primary Copper and Cobalt
Proved
Probable 0.1 0.95 0.65
Total 0.1 0.95 0.65
Sokoroshe Total 2.5 1.9 0.43

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum.

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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mineral Resources
and Ore Reserves
Continued

Ore Reserves1
2023 2022
Tonnes Cu Zn Pb Ag Au Mo Co Tonnes Cu Zn Pb Ag Au Mo Co
Deposit (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%) (Mt) (%) (%) (%) (g/t) (g/t) (ppm) (%)
Dugald River (100%)
Primary Zinc
Proved 12 11.3 1.9 57 12 10.9 1.9 62
Probable 8 10.0 1.4 14 10 10.1 0.9 14
Total 20 10.8 1.7 40 22 10.5 1.4 39
Dugald River Total 20 10.8 1.7 40 22 10.5 1.4 39
Rosebery (100%)
Proved 3.9 0.20 6.5 2.7 110 1.2 4.8 0.19 6.7 2.7 120 1.2
Probable 0.63 0.18 5.6 2.2 82 1.2 0.77 0.20 6.1 2.1 79 1.3
Total 4.5 0.20 6.4 2.6 110 1.2 5.5 0.19 6.6 2.6 110 1.2
Rosebery Total 4.5 0.20 6.4 2.6 110 1.2 5.5 0.19 6.6 2.6 110 1.2

1 S.I. units used for metals of value; Cu=copper, Zn=zinc, Pb=lead, Ag=silver, Au=gold, Mo=molybdenum, Co=cobalt.

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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mineral Resources
and Ore Reserves
Continued

Competent Persons
Table 1 - Competent Persons for Mineral Resources, Ore Reserves and Corporate

Competent Professional
Deposit Accountability Person Membership Employer
MMG Mineral Resources and Mineral Resources Rex Berthelsen 1
HonFAusIMM (CP Geo) MMG
Ore Reserves Committee
MMG Mineral Resources and Ore Reserves Cornel Parshotam1 MAusIMM MMG
Ore Reserves Committee
MMG Mineral Resources and Metallurgy: Mineral Andrew Goulsbra1 MAusIMM MMG
Ore Reserves Committee Resources / Ore Reserves
Las Bambas Mineral Resources Hugo Rios MAusIMM (CP Geo) MMG
Las Bambas Ore Reserves Xiaolin Wu1 SME RM4 MMG
Kinsevere Mineral Resources Jeremy Witley2 Pr.Sci.Nat. The MSA Group (Pty) Ltd
Kinsevere Ore Reserves Dean Basile MAusIMM (CP Min) Mining One Pty Ltd
Rosebery Mineral Resources Maree Angus MAusIMM (CP Geo), MAIG ERM Australia
Consultants Pty Ltd
Rosebery Ore Reserves Andrew Robertson FAusIMM MMG
Dugald River Mineral Resources Maree Angus MAusIMM (CP Geo), MAIG ERM Australia
Consultants Pty Ltd
Dugald River Ore Reserves Peter Willcox MAusIMM (CP Min), RPEQ MMG
High Lake, Izok Lake Mineral Resources Allan Armitage3 MAPEG (P.Geo) Formerly MMG

1 Participates in the MMG Long-Term Incentive Plans which may include Mineral Resources and Ore Reserves growth as a performance condition.
2 South African Council for Natural Scientific Professions, Professional Natural Scientist
3 Member of the Association of Professional Engineers and Geoscientists of British Columbia
4 Registered Member of the Society for Mining, Metallurgy and Exploration

The information in this report that relates to Mineral Resources and Ore Reserves is based on information
compiled by the listed Competent Persons, who are Members or Fellows of the Australasian Institute of
Mining and Metallurgy (AusIMM), the Australian Institute of Geoscientists (AIG) or a Recognised Professional
Organisation (RPO) and have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as
defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves. Each of the Competent Persons has given consent to the inclusion in the report of the matters
based on their information in the form and context in which it appears.

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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mineral Resources
and Ore Reserves
Continued

Summary of significant changes

Mineral Resources

Mineral Resources as at 30 June 2023 have changed, since the 30 June 2022 estimate, for several reasons with
the most significant changes outlined in this section.

Mineral Resources (contained metal) have decreased globally for copper (-13%), cobalt (-18%), molybdenum
(-15%) and gold (-12%). Zinc (-5%) and silver (-7%) have also decreased from 2022 while lead has increased
(17%). Variations to Mineral Resources (contained metal) on an individual site basis are discussed below:

Increases:

The increases in Mineral Resources (contained metal) are due to:

• continuous improvement in ore body modelling, specifically at Dugald River where improved lead modelling has
resulted in a 35% increase or an additional 264kt Pb metal in estimated metal content after depletion;
• increased metal price assumptions have partially offset the impact of cost increases and milling depletions;
• drilling in 2022 at Rosebery resulted in approximately 90kt ZnEQ to be added which has offset the 83kt ZnEQ
depleted by milling. Impact from increases in metal price assumptions has been negated by increased costs at
the operation; and
• drilling in 2022 at Mwepu which resulted in a 70% increase of copper.

Decreases:

The decreases in Mineral Resources (contained metal) are due to:

• milled depletion at all producing operations;

• cost increases account for most of the decreased copper Mineral Resource at Las Bambas Drilling and
remodelling at Las Bambas equating to approximately 1,260kt Cu metal. At Ferrobamba approximately 300kt of
copper metal was removed resulting from new drilling information in Phase 3 and Phase 5 of the open pit;
• increased costs and cut-off grades at Kinsevere have resulted in removing 46kt Cu in addition to 32kt Cu of
milled depletion and 13kt Cu from drilling and an updated estimate;
• zinc has decreased at Dugald River by 394kt Zn after depletion. Reclassification of some Inferred material, new
drilling data and increased costs and cut-off grade have resulted in reductions of 297kt Zn, 118kt Zn and 69kt
Zn respectively. These are partially offset by increases due to improved density estimation and effects of metal
price assumptions; and
• removal of a further 12kt Cu from Sulfobamba deposit at Las Bambas due to illegal mining over the last
12 months taking the total estimated depletion due to illegal mining to 62kt Cu.

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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mineral Resources
and Ore Reserves
Continued

Ore Reserves

Ore Reserves as at 30 June (contained metal) have decreased for copper (-9%), zinc (-7%), lead (-0.5%), silver
(-8%), gold (-13%), molybdenum (-2%) but have increased for cobalt (7%).

Variations to Ore Reserves (contained metal) on an individual site basis are discussed below:

Increases:

Increases in Ore Reserves (metal) as stated above are due to:

• the inclusion of Sokoroshe II copper and cobalt deposit for the first time resulting in a global increase of cobalt
Ore Reserves.
• improvements in geological modelling at Dugald River have resulted in increased estimates of lead across the
deposit.

Decreases:

Decreases in Ore Reserves (metal) as stated above are due to:

• milling and mining depletion at all producing operations;

• reductions of copper, molybdenum, gold and silver at Las Bambas are due to cost increases and new drilling in
Ferrobamba. Increased metal price assumptions have partially offset the impact;
• all metals at Rosebery (zinc, lead, silver, copper and gold) have reduced largely due to costs and subsequent
cut-off grade increases. Negative drill results also resulted in reduction of K lens from the estimate; and
• minor reductions in zinc and silver metal at Dugald River are indictive of Resource to Reserve conversion,
almost offsetting milling depleting and impacts due to increased cost assumptions and cut-off grades over the
12-month period.

Key assumptions
Prices and Exchange Rates

The following price and foreign exchange assumptions, set according to the relevant MMG Standard as at
February 2023, have been applied to all Mineral Resources and Ore Reserves estimates. Price assumptions for all
metals have changed from the 2022 Mineral Resources and Ore Reserves statement.

Table 2 - 2023 Price (real) and foreign exchange assumptions

Ore Reserves Mineral Resources

Cu (US$/lb) 3.92 4.71
Zn (US$/lb) 1.27 1.53
Pb (US$/lb) 0.91 1.10
Au US$/oz 1,575 1,890
Ag US$/oz 20.83 25.00
Mo (US$/lb) 11.19 13.43
Co (US$/lb) 23.37 32.72
USD:CAD 1.25
AUD:USD 0.75 As per Ore Reserves
USD:PEN 3.80

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Mineral Resources
and Ore Reserves
Continued

Cut-Off Grades

Mineral Resources and Ore Reserves cut-off values are shown in Table 3 and Table 4 respectively.

Table 3 - Mineral Resources cut-off grades

Likely Mining
Site Mineralisation Method1 Cut-Off Value Comments
Las Oxide copper OP 1% Cu Cut-off is applied as a range that varies for each
Bambas Primary copper Ferrobamba 0.15% Cu (average) deposit and mineralised rock type at Las Bambas.
Primary copper Chalcobamba 0.17% Cu (average) In-situ copper Mineral Resources constrained within
Primary copper Sulfobamba 0.19% Cu (average) US$4.71/lb Cu and US$13.43/lb Mo pit shell.
Kinsevere Oxide copper & stockpiles OP 0.5% CuAS2 In-situ copper Mineral Resources constrained within a
Transition mixed ore copper OP 0.7% Cu US$4.71/lb Cu and US$32.72/lb Co pit shell.
(TMO)
Primary copper OP 0.7% Cu
Oxide TMO Cobalt OP 0.2% Co In-situ cobalt Mineral Resources constrained within
Primary cobalt OP 0.2% Co a US$4.71/lb Cu and US$32.72/lb Co pit shell, but
exclusive of copper mineralisation.
Sokoroshe Oxide OP 0.6% CuAS2 In-situ copper Mineral Resources constrained within a
2 TMO Copper OP 0.8% Cu US$4.71/lb Cu and US$32.72/lb Co pit shell.
Primary copper OP 0.8% Cu2
Oxide TMO cobalt OP 0.2% Co In-situ cobalt Mineral Resources constrained within
Primary cobalt OP 0.2% Co a US$4.71/lb Cu and US$32.72/lb Co pit shell, but
exclusive of copper mineralisation above cut off.
Nambulwa Oxide copper OP 0.6% CuAS2 In-situ copper Mineral Resources constrained within a
/ DZ TMO copper OP 0.9% Cu US$4.71/lb Cu and US$32.72/lb Co pit shell.
Primary copper OP 0.8% Cu
Oxide TMO cobalt OP 0.2 Co In-situ cobalt Mineral Resources constrained within
Primary cobalt OP 0.2 Cu a US$4.71/lb Cu and US$32.71/lb Co pit shell, but
exclusive of copper mineralisation.
Mwepu Oxide copper OP 0.7% CuAS2 In-situ copper Mineral Resources constrained within a
TMO copper OP 1.0% Cu US$4.71/lb Cu and US$32.71/lb Co pit shell.
Primary copper OP 1.0% Cu
Oxide TMO cobalt OP 0.3% Co In-situ cobalt Mineral Resources constrained within
Primary cobalt OP 0.3% Co a US$4.71/lb Cu and US$32.71/lb Co pit shell, but
exclusive of copper mineralisation.
Rosebery Rosebery (Zn, Cu, Pb, Au, Ag) UG A$177/t NSR3 All areas of the mine are reported using the same NSR
cut-off value.
Dugald Primary zinc (Zn, Pb, Ag) UG A$161/t NSR3 All areas of the mine are reported using the same NSR
River cut-off value.
Primary copper UG 1% Cu All areas of the mine are reported at the same cut-off
grade
High Lake Cu, Zn, Pb, Ag, Au OP 2.0% CuEq4 CuEq4 = Cu + (Zn×0.30) + (Pb×0.33) + (Au×0.56)
+ (Ag×0.01): based on Long-Term prices and metal
recoveries at Au:75%, Ag:83%, Cu:89%, Pb:81% and
Zn:93%.
Cu, Zn, Pb, Ag, Au UG 4.0% CuEq4 CuEq4 = Cu + (Zn×0.30) + (Pb×0.33) + (Au×0.56)
+ (Ag×0.01): based on Long-Term prices and metal
recoveries at Au:75%, Ag:83%, Cu:89%, Pb:81% and
Zn:93%.
Izok Lake Cu, Zn, Pb, Ag, Au OP 4.0% ZnEq5 ZnEq1 = Zn + (Cu×3.31) + (Pb×1.09) + (Au×1.87) +
(Ag×0.033); prices and metal recoveries as per High
Lake.

1 OP = Open Pit, UG = Underground

2 CuAS = Acid Soluble copper
3 NSR = Net Smelter Return
4 CuEq = Copper Equivalent
5 ZnEq = Zinc Equivalent

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Mineral Resources
and Ore Reserves
Continued

Table 4 – Ore Reserves cut-off grades

Mining
Site Mineralisation Method Cut-Off Value Comments
Las Primary copper Ferrobamba OP 0.18% Cu (average) Range based on rock type recovery.
Bambas
Primary copper Chalcobamba 0.21% Cu (average)
Primary copper Sulfobamba 0.23% Cu
(average)
Kinsevere Oxide OP 0.9% CuAS1, 0.4% Approximate cut-off grades shown in this table.
Co Variable cut-off grade based on net value script.
Copper cut-off assumes zero cobalt. Cobalt cut-
TMO OP 1.0% Cu, 0.3% Co
off assumes zero copper. For Sokoroshe cut-offs
calculated on an incremental cost basis to Kinsevere
Primary OP 1.2% Cu, 0.4% Co

Sokoroshe Oxide OP 0.75% CuAS2,

2 0.35% Co
Rosebery (Zn, Cu, Pb, Au, Ag) UG A$177/t NSR2
Dugald Primary zinc UG A$158/t NSR3
River (average)

1 CuAS = Acid Soluble Copper

2 NSR = Net Smelter Return
3 Silver in Rosebery doré is calculated as a constant ratio to gold in the doré. Silver is set to 0.17 against gold being 20.7.

Processing Recoveries

Average processing recoveries are shown in Table 5. More detailed processing recovery relationships are
provided in the Technical Appendix.

Table 5 - Processing Recoveries

Recovery Concentrate
Moisture
Site Product Cu Zn Pb Ag Au Mo Co Assumptions
Las Bambas Copper Concentrate 86% - - 75% 71% 10%
Molybdenum Concentrate 55.5% 5%
Rosebery Zinc Concentrate 86% 7.8%
Lead Concentrate 7% 77% 39% 16% 6%
Copper Concentrate 59% 39% 37% 8.7%
Doré3 (gold and silver) 0.14 24%
Dugald River Zinc Concentrate − 91% 32% − 9.4%
Lead Concentrate − 63% 45% − 9.3%
Kinsevere and Copper Cathode (Oxide) 86%
satellites
Copper Cathode (Sulphide) 83%
Cobalt Precipitate (Oxide) 60%
Cobalt Precipitate (Sulphide) 72%

1 Silver in Rosebery doré is calculated as a constant ratio to gold in the doré. Silver is set to 0.17 against gold being 20.7.

The Technical Appendix published on the MMG website contains additional Mineral Resources and Ore Reserves
information (including the JORC 2012 Table 1 disclosure).

MMG Annual Report 2023 | 19

 Resources Management Directors’ Corporate ESG Approach Financial
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Management Discussion
and Analysis

Results for the year ended 31 December 2023

For the purpose of the management discussion and analysis, the Group’s results for the year ended
31 December 2023 are compared with results for the year ended 31 December 2022.

2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)

Revenue 4,346.5 3,254.2 34%

Operating expenses (2,814.1) (1,682.6) (67%)
Exploration expenses (49.6) (30.8) (61%)
Administration expenses (12.9) (16.0) 19%
Net other (expense)/income (8.0) 10.6 (175%)
EBITDA 1,461.9 1,535.4 (5%)
Depreciation and amortisation expenses (930.2) (790.1) (18%)
EBIT 531.7 745.3 (29%)
Net finance costs (342.1) (284.8) (20%)
Profit before income tax 189.6 460.5 (59%)
Income tax expense (67.5) (217.0) 69%
Profit for the year 122.1 243.5 (50%)

Attributable to:
Equity holders of the Company 9.0 172.4 (95%)
Non-controlling interests 113.1 71.1 59%

Profit attributable to equity holders of the Company

MMG’s profit of US$122.1 million for the year ended 31 December 2023 includes profit attributable to equity
holders of US$9.0 million and profit attributable to non-controlling interests of US$113.1 million. This compares
to a profit attributable to equity holders of US$172.4 million and profit attributable to non-controlling interests of
US$71.1 million for the year ended 31 December 2022. Amounts attributable to non-controlling interests relates
to the 37.5% interest in Las Bambas not owned by the Company.

The following table provides a reconciliation of reported profit after tax attributable to equity holders.

2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)
Profit after tax – Las Bambas 62.5% interest 188.6 118.4 59%
(Loss)/profit after tax – other continuing operations (55.9) 154.6 (136%)
Exploration expenses (49.6) (30.8) (61%)
Administration expenses (12.9) (16.0) 19%
Net finance costs (excluding Las Bambas) (98.5) (81.7) (21%)
Other 37.3 27.9 34%
Profit for the year attributable to equity holders 9.0 172.4 (95%)

20 | MMG Annual Report 2023

 Resources Management Directors’ Corporate ESG Approach Financial
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Management Discussion
and Analysis
Continued

Overview of operating results

The Group’s continuing operations comprise Las Bambas, Kinsevere, Dugald River and Rosebery. Exploration,
corporate activities and other subsidiaries are classified as ‘Other’.

Revenue EBITDA
2023 2022 Change % 2023 2022 Change %
Year ended 31 December US$ million US$ million Fav/(Unfav) US$ million US$ million Fav/(Unfav)
Las Bambas 3,417.3 2,086.8 64% 1,396.7 1,121.9 24%
Kinsevere 354.6 421.5 (16%) (32.0) 131.7 (124%)
Dugald River 331.2 484.3 (32%) 33.8 210.2 (84%)
Rosebery 240.0 259.9 (8%) 77.8 98.6 (21%)
Other 3.4 1.7 100% (14.4) (27.0) 47%
Total 4,346.5 3,254.2 34% 1,461.9 1,535.4 (5%)

The following discussion and analysis of the financial information and results should be read in conjunction with
the financial statements.

Revenue increased by US$1,092.3 million (34%) to US$4,346.5 million compared to 2022 due to higher sales
volumes (US$1,292.9 million), partly offset by lower commodity prices (US$200.6 million).

Sales volumes increased by US$1,292.9 million compared to 2022 driven by higher sales of copper concentrate
(US$1,332.0 million) and molybdenum concentrate (US$33.3 million) at Las Bambas due to stable logistics since
March 2023 compared to 173 days of road blockages throughout 2022. This was partly offset by lower copper
cathode sales volumes at Kinsevere (US$43.6 million) in line with lower production due to declining oxide feed
grades and lower ore milled caused by an unstable power supply from the national grid. Dugald River zinc and
lead concentrate sales volumes were also lower (US$39.4 million), as a result of a 34-day suspension due to the
tragic incident in February.

Unfavourable commodity price variances of US$200.6 million were driven by lower prices for zinc
(US$159.2 million) and copper (US$117.6 million), partly offset by higher prices for gold (US$28.3 million),
silver (US$25.5 million) and molybdenum (US$23.3 million). Price variances also include mark-to-market
adjustments on open sales contracts and the impacts of commodity hedging.

Revenue by commodity 2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)
Copper 3,304.2 2,227.7 48%
Zinc 359.4 547.1 (34%)
Lead 67.9 72.9 (7%)
Gold 233.5 151.5 54%
Silver 205.7 135.8 51%
Molybdenum 175.8 119.2 47%
Total 4,346.5 3,254.2 34%

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 Resources Management Directors’ Corporate ESG Approach Financial
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Management Discussion
and Analysis
Continued

Price

Average LME base metals prices for zinc, copper and lead were lower in the year ended 31 December 2023
compared to the prior corresponding period. The averages for molybdenum, gold and silver were higher.

Average LME cash price1 Change %

Year ended 31 December 2023 2022 Fav/(Unfav)
Copper (US$/tonne) 8,483 8,815 (4%)
Zinc (US$/tonne) 2,649 3,485 (24%)
Lead (US$/tonne) 2,137 2,153 (1%)
Gold (US$/ounce) 1,943 1,801 8%
Silver (US$/ounce) 23.39 21.75 8%
Molybdenum (US$/tonne) 53,231 41,411 29%

1 Sources: zinc, lead, and copper: LME cash settlement price; Molybdenum: Platts; gold and silver: LBMA. LME (London Metal Exchange) data is used in
this report under licence from LME; LME has no involvement and accepts no responsibility to any third party in connection with the data; and onward
distribution of the data by third parties is not permitted.

Sales volumes

Payable metal in products sold Change %

Year ended 31 December 2023 2022 Fav/(Unfav)
Copper (tonnes) 419,584 272,132 54%
Zinc (tonnes) 176,292 185,606 (5%)
Lead (tonnes) 34,389 36,461 (6%)
Gold (ounces) 121,316 89,049 36%
Silver (ounces) 8,926,822 6,707,204 33%
Molybdenum (tonnes) 4,037 3,156 28%

Payable metal in products sold Copper Zinc Lead Gold Silver Molybdenum
Year ended 31 December 2023 tonnes tonnes tonnes ounces ounces tonnes
Las Bambas 374,743 - - 94,925 5,361,326 4,037
Kinsevere 43,710 - - - - -
Dugald River - 128,628 17,535 - 1,358,919 -
Rosebery 1,131 47,664 16,854 26,391 2,206,577 -
Total 419,584 176,292 34,389 121,316 8,926,822 4,037

Payable metal in products sold Copper Zinc Lead Gold Silver Molybdenum
Year ended 31 December 2022 tonnes tonnes tonnes ounces ounces tonnes
Las Bambas 221,918 - - 62,901 3,293,364 3,156
Kinsevere 49,048 - - - - -
Dugald River - 140,980 19,116 - 1,342,406 -
Rosebery 1,166 44,626 17,345 26,148 2,071,434 -
Total 272,132 185,606 36,461 89,049 6,707,204 3,156

22 | MMG Annual Report 2023

 Resources Management Directors’ Corporate ESG Approach Financial
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Management Discussion
and Analysis
Continued

Operating expenses include expenses of operating sites, excluding depreciation and amortisation. Site
expenses include mining and processing expenses, changes in inventories, royalty expenses, selling expenses
and other operating expenses.

Total operating expenses increased by US$1,131.5 million (67%) in 2023. This increase was primarily
driven by unfavourable stock movement (US$787.4 million) resulting from the drawdown of Las Bambas
copper concentrate stockpiles, compared to a build-up in 2022. Additionally, higher production expenses
(US$273.1 million) were mainly attributable to higher costs at Las Bambas (US$214.5 million) in line with higher
material mined and milled volumes and higher copper concentrate transported. Furthermore, there was higher
consumption of third-party ores (US$47.3 million) at Kinsevere to offset the reduced oxide ore mined during the
transition to mining sulphide ores.

Further detail is set out below in the mine analysis section.

Exploration expenses increased by US$18.8 million (61%) to US$49.6 million in 2023. Expenditure at Las Bambas
(US$8.1 million) was higher with drilling focused on various locations within the Ferrobamba pit, including
Ferrobamba Deeps, Ferrobamba South, Ferrobamba East, and West Plant targets. Higher costs at Rosebery
(US$7.2 million) were due to the accelerated diamond drilling program to support life extension. At Kinsevere,
exploration expenses were higher by US$3.5 million driven by resource testing at Sokoroshe II and Nambulwa
satellite deposits.

Administrative expenses decreased by US$3.1 million (19%) to US$12.9 million in 2023 mainly due to the weaker
Australian dollar (US$3.5 million).

Net other expenses increased by US$18.6 million (175%) compared to a net other income of US$10.6 million
in 2022. This was mainly attributable to foreign exchange losses in 2023 (US$3.5 million) in contrast to foreign
exchange gains in 2022 (US$6.6 million).

Depreciation and amortisation expenses increased by US$140.1 million (18%) to US$930.2 million compared
to 2022. The increase was primarily attributable to higher mining and milling volumes at Las Bambas
(US$134.3 million).

Net finance costs increased by US$57.3 million (20%) to US$342.1 million compared to 2022. The increase
was mainly due to higher net interest costs driven by a rising interest rate environment (US$67.0 million),
higher discount unwind on mine rehabilitation provisions (US$9.5 million) and a refund of interest from SUNAT
(US$9.5M million) in 2022. This is partly offset by lower debt balances (US$18.2 million) and higher interest
income ($9.3 million) due to increased rates for funds on deposit.

Income tax expense decreased by US$149.5 million, reflecting the decrease in the Group’s underlying profit
before income tax from the prior year. Underlying income tax expense for 2023 of US$67.5 million reflects the
impacts of non-creditable withholding tax expenses in Peru of US$47.3 million (2022: US$35.8 million) and the
reversal of prior year tax provisions of US$38.7 million due to the completion of tax audits.

MMG Annual Report 2023 | 23

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis

Las Bambas
Location Products

Peru Copper concentrate

Molybdenum concentrate

Revenue (US$ million) Ownership

$3,417.3
Ore milled (tonnes)

52,871,670
Copper in concentrate produced (tonnes) MMG Limited 62.5%

302,033
Guoxin International Investment Co. Ltd. 22.5%

Citic Metal Co. Ltd. 15.0%

24 | MMG Annual Report 2023

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MMG Annual Report 2023 | 25

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Las Bambas
Continued

Change %
Year ended 31 December 2023 2022 Fav/(Unfav)
Production
Ore mined (tonnes) 46,429,483 43,178,984 8%
Ore milled (tonnes) 52,871,670 44,043,203 20%
Waste movement (tonnes) 122,908,814 116,206,593 6%
Copper in copper concentrate (tonnes) 302,033 254,836 19%
Payable metal in product sold
Copper (tonnes) 374,743 221,918 69%
Gold (ounces) 94,925 62,901 51%
Silver (ounces) 5,361,326 3,293,364 63%
Molybdenum (tonnes) 4,037 3,156 28%

2023 2022 Change%

Year ended 31 December US$ million US$ million Fav/(Unfav)
Revenue 3,417.3 2,086.8 64%
Operating expenses
Production expenses
Mining (490.4) (401.2) (22%)
Processing (316.3) (261.5) (21%)
Other (474.0) (403.5) (17%)
Total production expenses (1,280.7) (1,066.2) (20%)
Freight (transportation) (96.2) (86.1) (12%)
Royalties (104.5) (59.4) (76%)
Other 1
(532.3) 263.4 (302%)
Total operating expenses (2,013.7) (948.3) (112%)
Other expenses (6.9) (16.6) 58%
EBITDA 1,396.7 1,121.9 24%
Depreciation and amortisation expenses (800.0) (665.7) (20%)
EBIT 596.7 456.2 31%
EBITDA margin 41% 54%

Other operating expenses include changes in inventories, corporate recharges and other costs of operations.
1 

26 | MMG Annual Report 2023

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Las Bambas
Continued

Las Bambas produced 302,033 tonnes of copper in 2023, which was 47,197 tonnes (19%) higher than 2022
largely due to uninterrupted operations in 2023 that allowed 20% more ore to be processed compared to a
production shutdown of more than 50 days in the second quarter of 2022.

Copper sales volumes were 69% higher compared to 2022 due to stable logistics since March 2023 compared
to 173 days of road blockages throughout 2022. Copper concentrate sales of 1.1 million tonnes of concentrate
(374,743 tonnes of payable metal) for the year 2023 marks as the second-highest level since the commissioning
of the mine. As a result of the stability, on-site concentrate inventory was reduced to the minimal level of around
1,000 tonnes of copper in concentrate at the end of 2023, compared to approximately 85,000 tonnes at the
beginning of the year.

Revenue of US$3,417.3 million was US$1,330.5 million (64%) higher than 2022 due to higher sales volumes for
copper (US$1,236.8 million), gold (US$53.8 million), silver (US$41.4 million) and molybdenum (US$33.3 million)
and higher sales prices for molybdenum (US$23.3 million). This was partly offset by lower copper prices
(US$94.6 million).

Total production expenses of US$1,280.7 million were US$214.5 million or 20% above 2022. This was mainly
driven by higher material mined and milled volumes (US$77.2 million), lower deferred mine capitalisation costs
(US$67.6 million), higher copper concentrate transported (US$56.8 million) and increased maintenance works
previously deferred (US$50.2 million). Production expenses were also higher due to increased execution of
social programs ($22.5 million). This was partly offset by lower unit prices for diesel (US$21.1 million), explosives
(US$14.1 million) and grinding media (US$5.5 million).

EBIT was further impacted by unfavourable stock movement of US$787.4 million due to a drawdown of
concentrate inventory (US$468.3 million) in 2023, compared to a build-up (US$235.6 million) in 2022 and a
higher drawdown of ore stockpiles (US$80.7 million). Royalty expenses were also higher by US$45.1 million
reflecting higher revenue.

Depreciation and amortisation expenses were higher than 2022 by US$134.3 million (20%) due to higher mining
and milling volumes.

The C1 costs of US$1.60/lb for 2023 were below our guidance range of US$1.65 – US$1.75/lb, although they
were higher than the 2022 C1 costs of US$1.53/lb. The higher C1 unit costs in 2023 are attributed to higher
production costs and the absence of care and maintenance cost exclusions for the period of the shutdown
in 2022 (US$97.4 million), partly offset by increased copper production and higher by-product credits from
molybdenum, gold and silver.

2024 Outlook
Full-year production for 2024 is expected to be between 280,000 and 320,000 tonnes of copper in concentrate.
This is largely in line with 2023 but is subject to the timing of the development of Chalcobamba.

Las Bambas C1 costs in 2024 are expected to be in the range of US$1.60 – US$1.80/lb, representing an increase
compared to 2023 primarily due to higher ore mined and milled volumes and lower by-product credits related to
lower molybdenum price assumptions.

MMG Annual Report 2023 | 27

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis

Kinsevere
Location Product

Democratic Copper cathode

Republic of Congo Cobalt hydroxide

Revenue (US$ million) Ownership

$354.6
Ore milled (tonnes)

2,107,223
Copper cathode produced (tonnes) MMG Limited100.0%

44,068

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MMG Annual Report 2023 | 29

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Kinsevere
Continued

Change %
Year ended 31 December 2023 2022 Fav/(Unfav)
Production
Ore mined (tonnes) 1,726,145 3,100,273 (44%)
Ore milled (tonnes) 2,107,223 2,348,699 (10%)
Waste movement (tonnes) 32,646,890 7,087,508 361%
Copper cathode (tonnes) 44,068 49,070 (10%)
Cobalt (tonnes) 105 - -
Payable metal in product sold
Copper (tonnes)1 43,710 49,048 (11%)

Year ended 31 December 2023 2022 Change %

US$ million US$ million Fav/(Unfav)
Revenue 354.6 421.5 (16%)
Operating expenses
Production expenses
Mining (18.7) (62.5) 70%
Processing (188.0) (118.7) (58%)
Other (90.8) (74.3) (22%)
Total production expenses (297.5) (255.5) (16%)
Freight (transportation) (7.3) (5.0) (46%)
Royalties (17.8) (23.6) 25%
Other2 (32.2) (10.2) (216%)
Total operating expenses (354.8) (294.3) (21%)
Other (expenses)/income (31.8) 4.5 (807%)
EBITDA (32.0) 131.7 (124%)
Depreciation and amortisation expenses (27.5) (27.8) 1%
EBIT (59.5) 103.9 (157%)
EBITDA margin (9%) 31%

1 Kinsevere sold copper includes copper cathode and copper scrap.

2 Other operating expenses include changes in inventories, corporate recharges and other costs of operations.

30 | MMG Annual Report 2023

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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Kinsevere
Continued

Kinsevere produced 44,068 tonnes of copper cathode, which is a decrease of 10% compared to 2022. The
lower cathode production was primarily attributed to a decrease in ore milled throughput (2,107,223 tonnes vs.
2,348,699 tonnes) caused by an unstable power supply from the national grid alongside lower ore feed grade.

Kinsevere revenue decreased by US$66.9 million (16%) to US$354.6 million compared to 2022 due to lower
copper sales volumes in line with lower production (US$43.6 million) and lower copper prices (US$23.3 million).

Total production expenses increased by US$42.0 million or 16% compared to 2022. This was mainly driven by
higher consumption of third-party ores (US$47.3 million) to offset the reduced oxide ore mined volume, and
higher sulphuric acid consumption (US$12.3 million). Net mining costs decreased by US$43.8 million, primarily
due to a rise in capitalised mining costs (US$115.3 million), which is associated with increased waste stripping
activities as the operation transitions from mining oxide ores to mining sulphide ores. This more than offset the
increased gross mining costs (US$72.8 million) as a result of a full year of mining operations in 2023 including
the commencement of mining at Sokoroshe II.

Other operating expenses were higher than 2022 by US$22.0 million driven by unfavourable stock movement
(US$12.1 million) due to the higher net drawdown of ore stockpiles.

Other expenses were higher than 2022 by US$36.3 million driven by foreign exchange losses in 2023
(US$17.9 million) and a release of legacy provisions in 2022 relating to the 2012 Kinsevere acquisition
(US$14.1 million).

C1 costs for 2023 were US$3.29/lb, higher than the US$2.55/lb in 2022 driven by lower production, and higher
processing cost caused by higher consumption of third-party ores and higher consumption of sulphuric acid.

2024 Outlook
Kinsevere copper cathode production for 2024 is expected to be in the range of 39,000 and 44,000 tonnes. This
range reflects the declining supply of oxide ore due to the transition from the mining of oxide ores to the mining
of sulphide ores. The supply from Sokoroshe II is expected to increase in 2024 to compensate for the reduced
oxide ore mined from the Kinsevere main pit.

C1 costs in 2024 are expected to be in the range of US$2.80 – US$3.15/lb. This represents an improvement
from 2023 due to by-product credits from cobalt production and an increase in the supply of ore mined from
Sokoroshe II to reduce the reliance on third-party ore. Looking ahead to 2025 and beyond, the combination of
higher copper production and cobalt by-product credits is expected to significantly lower the mine’s C1 costs.

MMG Annual Report 2023 | 31

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis

Dugald River
Location Product

Australia Zinc concentrate

Lead concentrate

Revenue (US$ million) Ownership

$331.2
Ore milled (tonnes)

1,660,104
Zinc in zinc concentrate
produced (tonnes) MMG Limited100.0%

151,844
Lead in lead concentrate
produced (tonnes)

19,907
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Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Dugald River
Continued

Change %
Year ended 31 December 2023 2022 Fav/(Unfav)
Production
Ore mined (tonnes) 1,650,517 1,873,332 (12%)
Ore milled (tonnes) 1,660,104 1,844,212 (10%)
Zinc in zinc concentrate (tonnes) 151,844 173,395 (12%)
Lead in lead concentrate (tonnes) 19,907 20,869 (5%)
Payable metal in product sold
Zinc (tonnes) 128,628 140,980 (9%)
Lead (tonnes) 17,535 19,116 (8%)
Silver (ounces) 1,358,919 1,342,406 1%

2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)
Revenue 331.2 484.3 (32%)
Operating expenses
Production expenses
Mining (115.4) (111.6) (3%)
Processing (66.1) (68.6) 4%
Other (65.7) (69.3) 5%
Total production expenses (247.2) (249.5) 1%
Freight (transportation) (16.6) (18.2) 9%
Royalties (14.9) (20.7) 28%
Other1 (15.4) 10.9 (241%)
Total operating expenses (294.1) (277.5) (6%)
Other (expenses)/income (3.3) 3.4 (197%)
EBITDA 33.8 210.2 (84%)
Depreciation and amortisation expenses (53.1) (57.7) 8%
EBIT (19.3) 152.5 (113%)
EBITDA margin 10% 43%

Other operating expenses include changes in inventories, corporate recharges and other costs of operations.
1 

34 | MMG Annual Report 2023

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Dugald River
Continued

Dugald River produced 151,844 tonnes of zinc in zinc concentrate in 2023, which was 12% lower than 2022
as operations were suspended for 34 days after the fatal incident at the mine on 15 February 2023. Zinc
metal production was also impacted by lower ore feed grades associated with the mining sequence, partially
offset by record-high annual zinc recovery rates of 90.0% compared to 89.3% in 2022 driven by ongoing plant
optimisation.

Revenue decreased by US$153.1 million to US$331.2 million due to lower zinc prices (US$117.2 million), a 9% drop
in zinc sales volumes (US$36.6 million) and an 8% drop in lead sales volumes (US$3.2 million) in line with lower
production. This was partly offset by higher silver prices (US$2.5 million).

Total production expenses decreased by US$2.3 million compared to 2022, primarily attributed to the favourable
impact of the weaker Australian dollar (US$10.5 million) and lower costs (US$6.1 million) due to the suspension of
operations. This reduction was partly offset by increased energy costs with higher gas prices (US$18.3 million)
partly offset by savings from solar power (US$9.6 million), as well as unfavourable mining costs (US$4.1 million)
due to increased development metres.

EBIT was additionally affected by unfavourable stock movement of US$26.2 million due to a net drawdown of
concentrate inventory and ore stockpiles in 2023, as opposed to a net build-up in 2022. This was partly offset by
lower royalties (US$5.8 million) in line with a decrease in revenue.

Dugald River’s zinc C1 costs were US$0.93/lb in 2023, higher than the US$0.84/lb in 2022 but outperforming
the revised guidance of US$1.05 – US$1.20/lb. The higher C1 costs were largely attributable to lower production
volumes.

2024 Outlook
Dugald River zinc production for 2024 is expected to be in the range of 175,000 and 190,000 tonnes of zinc in
zinc concentrate. This is a substantial improvement over 2023 reflecting the anticipated stable operations and
continuous operational improvements compared to the suspension of operations in the first quarter of 2023.

C1 costs in 2024 are expected to be in the range of US$0.70 – US$0.85/lb due to the increased production as
well as lower anticipated zinc treatment charges.

MMG Annual Report 2023 | 35

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis

Rosebery
Location Product
Zinc concentrate

Australia Lead concentrate

Precious Metals Concentrate
Gold Doré

Revenue (US$ million) Ownership

$240.0
Ore milled (tonnes)

918,074
Zinc in zinc concentrate
produced (tonnes) MMG Limited100.0%

51,626

36 | MMG Annual Report 2023

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MMG Annual Report 2023 | 37

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Rosebery
Continued

Change %
Year ended 31 December 2023 2022 Fav/(Unfav)
Production
Ore mined (tonnes) 922,275 886,118 4%
Ore milled (tonnes) 918,074 896,861 2%
Zinc in zinc concentrate (tonnes) 51,626 51,156 1%
Lead in lead concentrate (tonnes) 19,147 18,077 6%
Copper in precious metals concentrate (tonnes) 1,163 1,147 1%
Gold (ounces) 30,096 26,709 13%
Silver (ounces) 2,583,418 2,178,998 19%
Payable metal in product sold
Copper (tonnes) 1,131 1,166 (3%)
Zinc (tonnes) 47,664 44,626 7%
Lead (tonnes) 16,854 17,345 (3%)
Gold (ounces) 26,391 26,148 1%
Silver (ounces) 2,206,577 2,071,434 7%

2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)
Revenue 240.0 259.9 (8%)
Operating expenses
Production expenses
Mining (78.2) (70.5) (11%)
Processing (33.0) (31.0) (6%)
Other (29.8) (26.7) (12%)
Total production expenses (141.0) (128.2) (10%)
Freight (transportation) (7.8) (10.1) 23%
Royalties (3.7) (12.8) 71%
Other 1
(4.0) (10.2) 61%
Total operating expenses (156.5) (161.3) 3%
Other expenses (5.7) - (100%)
EBITDA 77.8 98.6 (21%)
Depreciation and amortisation expenses (56.8) (46.9) (21%)
EBIT 21.0 51.7 (59%)
EBITDA margin 32% 38%

1 Other operating expenses include changes in inventories, corporate recharges and other costs of operations.

38 | MMG Annual Report 2023

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Mine Analysis:
Rosebery
Continued

Rosebery produced 51,626 tonnes of zinc in zinc concentrate and 19,147 tonnes of lead in lead concentrate in
2023. This represented a 1% and 6% increase respectively compared to 2022. The volume of ore mined was 4%
higher compared to 2022, primarily due to mining sequence and improved workforce availability, despite lost
production in January resulting from the bushfire incident.

Precious metal production for 2023 totalled 30,096 ounces of gold and 2,583,418 ounces of silver. This
represents an increase of 13% and 19% respectively compared to 2022, reflecting higher grades for both gold
and silver.

Revenue decreased by US$19.9 million (8%) to US$240.0 million due to lower prices for zinc (US$42.0 million),
lead (US$1.8 million), and copper (US$1.0 million), this was partly offset by higher zinc sales volumes (US$8.8
million), higher precious metal prices (US$14.1 million) and higher precious metal sales volumes (US$3.1 million).

Total production expenses increased by US$12.8 million (10%) compared to 2022 mainly due to higher mining
costs (US$11.8 million) driven by increased ore mined, higher backfill volumes and higher intensity of ground
support in seismically active areas of the mine. Processing costs were also higher by US$3.5 million driven by
higher ore milled volumes. This is partly offset by impact of the weaker Australian dollar (US$6.1 million).

Royalties were favourable by US$9.1 million reflecting lower sales revenue and profit as well as an adjustment
that was made to the prior year’s royalty return.

Rosebery’s C1 costs were US$0.26/lb in 2023, in line with 2022, as higher production expenses were offset by
higher by-product credits.

2024 Outlook
Rosebery zinc production for 2024 is expected to be in the range of 50,000 to 60,000 tonnes of zinc in zinc
concentrate, an improvement on 2023 mainly due to higher expected zinc grades. Including the contribution
of by-product metals, zinc equivalent production for 2024 is expected to be in the range of 115,000 to
130,000 tonnes.

C1 costs for 2024 are expected to be in the range of US$0.10 – US$0.25/lb. This is an improvement on 2023 due
to higher anticipated production levels and lower zinc treatment charges.

MMG Annual Report 2023 | 39

 Resources Management Directors’ Corporate ESG Approach Financial
Highlights and Reserves Discussion and Analysis Report Governance and Performance Statements

Management Discussion
and Analysis
Continued

Cash flow analysis

Net cash flow

2023 2022 Change %

Year ended 31 December US$ million US$ million Fav/(Unfav)
Net operating cash flows 1,849.9 832.1 122%
Net investing cash flows (790.0) (538.7) (47%)
Net financing cash flows (985.1) (1,176.5) 16%
Net cash inflows/(outflows) 74.8 (883.1) 108%

Net operating cash inflows increased by US$1,017.8 million (122%) to US$1,849.9 million driven by favourable
working capital movements (US$828.2 million) with a copper concentrate inventory drawdown at Las Bambas
compared to a build-up in 2022. Lower tax payments in Peru (US$160.9 million) and the DRC (US$29.5 million)
also contributed positively.

Net investing cash outflows increased by US$251.3 million (47%) to US$790.0 million. This was driven by higher
capital expenditure at Kinsevere (US$251.5 million) attributable to expenditure on the Kinsevere Expansion
Project.

Net financing cash outflows were favourable by US$191.4 million (16%) compared to 2022. This was due to a
US$500.0 million early payment on the Las Bambas Project facility in 2022 and cash received on early closure of
the Interest Rate Swap (US$96.0 million). This was partly offset by a net repayment on working capital facilities
(US$150.0 million) in 2023 compared to a net drawdown ($150.0 million) in 2022, and higher net finance costs
paid (US$81.8 million).

Financial resources and liquidity

31 December 2023 31 December 2022 Change

US$ million US$ million US$ million
Total assets 11,900.8 12,535.5 (634.7)
Total liabilities (7,588.8) (8,307.0) 718.2
Total equity 4,312.0 4,228.5 83.5

Total equity increased by US$83.5 million to US$4,312.0 million as at 31 December 2023.

40 | MMG Annual Report 2023

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Management Discussion
and Analysis
Continued

The gearing ratio for the Group is defined as net debt (total borrowings excluding finance charge prepayments, less
cash, and cash equivalents) divided by the aggregate of net debt and total equity as set out in the following table:

31 December 2023 31 December 2022

MMG Group US$ million US$ million
Total borrowings (excluding prepaid finance charges)1 4,748.1 5,456.9
Less: cash and cash equivalents (447.0) (372.2)
Net debt 4,301.1 5,084.7
Total equity 4,312.0 4,228.5
Net debt +Total equity 8,613.1 9,313.2

Gearing ratio 0.50 0.55

1 Borrowings at an MMG Group level reflect 100% of the borrowings of the Las Bambas Joint Venture Group. Las Bambas Joint Venture Group
borrowings as at 31 December 2023 were US$2,016.8 million (31 December 2022: US$3,025.6 million) and Las Bambas Joint Venture Group cash and
cash equivalents as at 31 December 2023 were US$399.2 million (31 December 2022: US$171.8 million). For the purpose of calculating the gearing
ratio, Las Bambas Joint Venture Group’s borrowings have not been reduced to reflect the MMG Group’s 62.5% equity interest. This is consistent with
the basis of the preparation of MMG’s financial statements.

Available debt facilities

As at the date of the financial statements are authorised to be issue, the Group (excluding the Las Bambas Joint
Venture Group) had available in its undrawn debt facilities an amount of US$3,350 million (31 December 2022:
US$300.0 million). These include:

1. A new US$1,000.0 million RCF from Top Create was undrawn and available. It will expire in December 2026;
2. A new US$200.0 million RCF from China Construction Bank (“CCB”) of which US$50.0 million was undrawn
and available. It will expire in January 2027;
3. A new US$300.0 million Term Loan Facility from Top Create supporting KEP project was undrawn and
available. It will expire in December 2030; and
4. A new US$2,000.0 million shareholder term loan facility with Top Create to support the acquisition of the
Cuprous Capital Ltd (“CCL”) and its subsidiaries was undrawn and available.

As at the date of the financial statements are authorised to be issue, the Las Bambas Joint Venture Group had
available in its undrawn debt facilities of US$975.0 million (31 December 2022: US$800.0 million). These include:

1. A US$350.0 million RCF from Album Enterprises was undrawn and available. This facility was successfully
extended for 1 year and will expire in August 2024;
2. A new US$275.0 million RCF from BOC was undrawn and available. This facility will expire in April 2026;
3. A new US$150.0 million RCF from ICBC made up from three tranches of US$50.0 million each was undrawn
and available. This facility will expire in March, May and June 2026;
4. A new US$100.0 million RCF from CCB was undrawn and available. This facility will expire in February 2027;
and
5. A new US$100.0 million RCF from BOCOM was undrawn and available. This facility will expire in August 2026;
Note: The US$800.0 million revolving credit facility available at 31 December 2022 provided by China Development Bank, Bank of China, Bank of
Communications and The Export-Import Bank of China for operation and general corporate purposes was cancelled in September 2023.

The Group’s certain available external debt facilities are subject to covenant compliance requirements. The Group
was not in breach of covenant requirements in respect of the Group’s borrowings at 31 December 2023. Certain
financial covenants are measured with reference to the financial performance of the Group or its subsidiaries,
and may be influenced by future operational performance.

MMG Annual Report 2023 | 41

 Resources Management Directors’ Corporate ESG Approach Financial
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Management Discussion
and Analysis
Continued

Placing of new shares under general mandate

On 8 June 2021, the Company undertook a share placement with an issue of 565.0 million shares at a price of
HK$4.15 per share (“the Placement”). The net proceeds, after deducting share issue costs of US$3.1 million, was
US$299.0 million.

At 31 December 2023, the Company has no amount of proceeds brought forward from the placement
(31 December 2022: US$85.0 million). The Company has applied 49.8% (31 December 2022: 29.9%) of the net
proceeds to the KEP project; and 50.2% (31 December 2022: 70.1%) for the replenishment of working capital and
general corporate purposes to support the Company’s strategy.

Development projects
The Chalcobamba project, as part of the next phase of development at Las Bambas, is located around three
kilometres from the current processing plant. In March 2022, the Peru Ministry of Energy and Mines granted
regulatory approval for the development of the Chalcobamba pit and associated infrastructure.

MMG remains committed to working closely with the Government of Peru and community members for
transparent and constructive dialogue. Discussions with the Huancuire community have advanced with the
signing of five contracts with community companies and these companies have now commenced early works at
Chalcobamba. The Las Bambas team is working with the Huancuire community towards enduring agreements for
the development of the Chalcobamba deposit.

The project is significant for the economy of Peru and will support additional social contributions and financial
and business opportunities for local and regional communities. It will underpin an annual production increase to a
range of 350,000 to 400,000 tonnes over the medium term.

In addition to the Chalcobamba project, successful deep drilling below the current Ferrobamba pit has defined
the depth extension and continuity of skarn and porphyry mineralisation beneath the 2022 Ore Reserve pit
design. These positive drill results confirmed the potential for a large tonnage of copper (at 0.4% to 0.6%),
molybdenum (at 200 to 500 ppm), silver (2g/t to 4g/t) and gold (0.04g/t to 0.08g/t) grade deposit may exist at
Ferrobamba Deeps. Ongoing studies are being conducted based on these positive results, and further drilling is
planned for 2024 to evaluate the mineralisation and determine potential mining methods, including expansion of
the open pit and/or an underground development.

Kinsevere Expansion Project, which includes the transition to the mining and processing of sulphide ore and the
commencement of cobalt production, remains on track. The cobalt plant was commissioned in the fourth quarter
of 2023 with cobalt hydroxide produced, containing 105 tonnes of cobalt. The new tailing storage facility was
commissioned to support the cobalt plant ramp-up.

The construction of the sulphide processing system continued with the majority of civil work completed in the
fourth quarter. The site started receiving long-lead equipment and material. Mechanical and structural installation
has also commenced. Progress has been made at the jaw crusher, coarse ore stockpile, SAG mill, flotation cells,
thickeners and concentrator storage, as well as the main body of the roaster plant.

Moving forward, the focus will be on the ramp-up of the cobalt plant and completing the installation of the
concentrator and the roaster, gas cleaning and acid plant (RGA) as well as operational readiness-related work.

This next phase of Kinsevere development will extend Kinsevere’s mine life to at least 2035 and, once fully
ramped up, will result in total annual production of approximately 80,000 tonnes of copper cathode and 4,000-
6,000 tonnes of cobalt in cobalt hydroxide. The first production of copper cathode from sulphides is expected in
the second half of 2024, and a full ramp-up is expected in 2025.

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Management Discussion
and Analysis
Continued

Rosebery mine life extension is being supported by an accelerated exploration program. Project Legacy,
initiated in 2023, is designed with the objective of extending the mine life through an accelerated diamond
drilling program. This drilling program, which includes both underground and surface drilling, has already resulted
in several intersections. The current orebody knowledge demonstrates that extensions to the Rosebery orebody
are possible with new targets emerging in the field. Several targets show significant intercepts and growth
potential. Project Legacy is set to continue the accelerated drilling strategy in 2024, with a primary focus on
exploring key targets.

The Rosebery mine continues to engage with the Minister and the Department of Climate Change, Energy, the
Environment and Water (DCCEEW) and provide all required information and documentation while awaiting the
Minister’s decision on the proposed preliminary works at South Marionoak. Concurrently the mine is continuing
to investigate potential options for safe and viable short-term capacity increases at existing tailings storage
facilities. Finding a sustainable tailings storage solution that supports the Rosebery mine life extension remains a
key priority for our operation and we will continue to proactively explore all feasible options.

There were no other major development projects noted during the year ended 31 December 2023.

Contracts and commitments

Throughout the year 2023, a total of 745 contracts have been reviewed either through market engagements or
in-contract renegotiations. The approximate annual operational or capital values addressed by these activities
comes to US$1,047.6 million.

Significant contracting activities were conducted across all operational sites to ensure the security of supply
for critical inputs and other necessary requirements. This was essential to support the scheduled execution of
projects, the continuity of our operations, and the effective management of potential disruption risks.

Las Bambas

New and revised agreements were finalised to optimise production and development options for Las Bambas.
These agreements include contracts for a consolidated head contractor for projects, which encompasses
studies, engineering services and construction supervision. Additionally, contracts were finalised for activities
such as projects construction (including an EPC contract for the new truck shop, construction of phase 6 of the
tailings storage facility and tailings deposition improvement), new fuel supply, mining services such as blasting
and drilling services, equipment maintenance, catering and camp services, personal transportation, health and
medical services, road maintenance, customs and freight forwarding, plant shutdown services, major component
repair, as well as components, spares and other consumables. Significant efforts were made to ensure the
safety and continuity of supply during blockades in the first quarter of the year in order to support continued
operations.

Kinsevere

Several new and revised agreements were finalised for activities such as deployment of a fleet management
system, tailing storage facility-related works, procurement of generator sets and slope monitoring equipment.
Parts of the contract packages for the Kinsevere Expansion Project, which were signed in 2022, were completed
in 2023. These completed packages include construction of the cobalt plant package, the third tailing storage
facility (TSF3) package and the Sokoroshe II mine infrastructure package. The equipment and materials required
for the RGA (Roaster, Gas Cleaning, and Acid) plant and the concentration plant are being delivered to the site,
with the construction of these components set to continue throughout 2024.

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Management Discussion
and Analysis
Continued

Dugald River

New and revised agreements were finalised to support the optimisation of production performance and
operation, particularly in consideration for the owner-operator transition for production mining. These
agreements include multiple contracts for the purchase of mobile equipment, related maintenance support, and
necessary amendments to contracted development mining services. A number of logistics agreements related to
the outbound transport of concentrate were executed and will be further optimised with additional contracts in
early 2024. Additionally, contracts were finalised for a number of bulk chemicals used in the processing plant.

Ongoing activity has involved the review of long-term energy options. In 2023, around one third of the power
requirement transitioned to solar, and a number of gas contracts were entered into for 2024 to continue firming
power supply. Sustainable long-term power options are under review to drive cost reduction and increase the
adoption of renewable energy sources.

Rosebery

New and revised agreements were finalised for various significant goods and services across the operation.
These agreements cover ground support materials and services, various groundwater monitoring/environment
testing services and various mobile equipment items, including Rosebery’s first diesel-electric loader, following
trials earlier in the year.

Group

New and revised agreements have been finalised for various goods and services, including IT-related goods and
services as well as a number of professional services consultancy agreements covering marketing, assurance,
risk and audit, finance and reporting, and HR (Human Resources).

People
As at 31 December 2023, the Group employed a total of 4,542 full-time equivalent employees (2022: 4,296) in
its continuing operations (excluding contractors and casual employees) with the majority of employees based in
Australia, Peru, the DRC, China and Laos.

Total employee benefits expenses for the Group’s operations for the year ended 31 December 2023, including
Directors’ emoluments, totalled US$365.7 million (2022: US$321.9 million). The increase was mainly due to the
insourcing of mining activities at Dugald River and the commencement of the Kinsevere Expansion Project in the
DRC.

The Group has remuneration policies that align with market practice and remunerates its employees based
on the accountabilities of their role, their performance, market practice, legislative requirements and the
performance of the Group. Employee benefits include market-competitive fixed remuneration, performance-
related incentives, a limited company equity scheme and, in specific cases, insurance and medical support.
A range of targeted training and development programs are provided to employees across the Group that are
designed to improve individual capability and enhance employee and Group performance.

Exploration activities
Las Bambas

Extensive drilling activities were conducted at various locations within the Ferrobamba pit. Specifically, drilling at
Ferrobamba Deeps continued, situated directly beneath the current Ferrobamba Ore Reserve pit.

Ongoing studies and further drilling are planned for 2024 to evaluate the mineralisation and determine potential
mining methods including expansion of the open pit and / or an underground development at Ferrobamba Deeps.

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Management Discussion
and Analysis
Continued

Additionally, drilling activities were carried out at Ferrobamba South, Ferrobamba East, and West Plant targets,
focusing primarily on near-surface skarn and porphyry copper mineralisation. At Ferrobamba South, drilling
specifically targeted the extension of mineralisation along the southern edge of the Ferrobamba pit and the
depth extension of Ferrobamba Deeps. Similarly, at Ferrobamba East, the objective was to explore the extension
of mineralisation east of the current open pit. At the West Plant project, drilling activities concentrated on
identifying polymetallic intermediate sulfidation veins located west of the processing plant.

Kinsevere

The 2023 exploration program focused on resource testing drilling and resource delineation drilling at the
Kinsevere mine site and satellite projects.

At Kinsevere the drilling concentrated on the Saddle and Mashi extension targets. On the Nambulwa tenement,
drilling activities concentrated on the Kimbwe-Kafubu target. Additional prospect testing occurred at Wasumbu
and Kamafesa oxide copper targets.

Furthermore, the geological model for Saddle area in Kinsevere was completed in preparation for resource
estimation, and the construction of the geological model for the northwest-extension of the Kinsevere mine is in
progress.

Dugald River

The 2023 surface exploration drilling campaign for Extended Dugald River (EDR) focused on extending the
Dugald River lode at depth, with a total of eight drill holes aimed at extending and improving geological
confidence in the central and south extents of the Dugald River lode. Additionally, an exploration program
targeting Cu-Au-Co included a scout hole drilled into the M2 target to test a magnetic anomaly from the
sub-audio magnetic (SAM) geophysical survey completed in the third quarter 2023. Another long (+650m)
underground diamond drill hole tested geochemical and geophysical anomalies interpreted from the 2023 down-
hole electro-magnetic (DHEM) survey at Target Z.

Rosebery

Project Legacy, initiated in January 2023, is designed with the objective of extending the mine life through an
accelerated diamond drilling program. This program employs 5 underground rigs and 3 surface rigs to carry out
exploration drilling around the known Rosebery orebody. The in-mine drilling has focussed on areas outside the
current mining focus in the lower mine such as T Lens, U Downdip, Lower V Lens, Lower H Lens, AB South and
AB North.

Further drilling concentrated to the north of the lower mine such as Z Lens. Surface and underground drilling
was also conducted to the west of the Rosebery Fault into the Oak prospect. In 2024, other targets will also be
tested as part of this exploration.

Furthermore, surface drilling in the late fourth quarter focussed on growth potential at the historical Jupiter and
Hercules mines, which are located 4km and 8km south of Rosebery, respectively.

Project Legacy is set to continue the accelerated drilling program in 2024, with a primary focus on exploring
key targets.

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Management Discussion
and Analysis
Continued

Average
Meterage Number of length
Project Hole type (metres) holes (metres)
Americas
Las Bambas Diamond (Ferrobamba Deeps) 36,831 57 646
Diamond (Ferrobamba South) 11,453 14 818
Diamond (Ferrobamba East) 1,983 4 496
Diamond (West Plant) 2,228 4 557
Africa
Kinsevere Diamond (SOK II Regional) 4,636 28 166
Diamond (Nambulwa - Wasumbu) 1,195 6 199
Diamond (Kamafesa) 601 4 150

Diamond (Kinsevere Hill SE Extension) 440 2 220

Diamond (Mashi Extension) 4,584 15 306

Diamond (Nambulwa - Kimbwe Kafubu) 7,031 34 207

Diamond (Kinsevere Saddle) 4,976 18 276

Australia
Dugald River Diamond EDR Near-Mine growth 10,172 8 1,272
Diamond Cu-Au-Co exploration 1,275 2 638
Rosebery Diamond – surface exploration 31,938 72 444
Diamond – underground exploration 52,525 201 261
Total 171,868 469 366

Material acquisitions and disposals

On 21 November 2023, MMG announced that it entered into a Share Purchase Agreement with Cuprous Capital
Ltd on 20 November 2023 to acquire the Khoemacau Mine in Botswana for US$1,875,000,000. The Khoemacau
Mine is a large, long life copper mine located in north-west Botswana, in the emerging Kalahari Copperbelt. The
Khoemacau Mine’s 4,040 km2 tenement package hosts the 10th largest African copper Mineral Resource by total
contained copper metal and is one of the largest copper sedimentary systems in the world outside of the Central
African Copperbelt.

The Company has received written Shareholders’ approval in respect of the acquisition from China Minmetals
H.K. (Holdings) Limited, which holds approximately 67.55% of the total issued Shares of the Company, in
accordance with Rule 14.44 of the Listing Rules. Accordingly, no general meeting will be convened by the
Company to approve the acquisition. The Company will despatch the circular in relation to the acquisition to the
Shareholders on or before 31 May 2024.

The acquisition is subject to the fulfillment or waiver of certain conditions and may or may not proceed to
completion. On 22 December 2023, Khoemacau Copper Mining (Pty) Ltd, a subsidiary of Cuprous Capital Ltd,
received approval from the Minister of Minerals and Energy of Botswana in respect of the transfer of a controlling
interest in the project licenses and prospecting licenses associated with the Khoemacau Copper Mine, brought
about by the acquisition.

The Company has obtained unconditional approvals of the acquisition from the Competition and Consumer
Authority of Botswana and the State Administration for Market Regulation of the PRC on 30 January 2024 and 25
December 2023 respectively and the relevant conditions have been satisfied.

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Management Discussion
and Analysis
Continued

Subject to the terms of the Agreement, MMG and Cuprous Capital Ltd have agreed to work towards Completion
in the first quarter of 2024.

Events after the reporting date

Other than the matters outlined below, there have been no matters that have occurred subsequent to the
reporting date, which have significantly affected, or may significantly affect, the Group’s operations, results or
state of affairs in future years.

• On 20 November 2023, the Group entered into a Share Purchase Agreement with Cupric Canyon Capital L.P.,
The Ferreira Family Trust, Resource Capital Fund VII L.P., and the Missouri Local Government Employees’
Retirement System (Sellers). The Group has conditionally agreed to purchase the entire issued share capital
of CCL from the Sellers at a purchase price of US$1,875.0 million.
• As at the date of this report, the acquisition had been approved by the Minister of Minerals and Energy
of Botswana; the Competition and Consumer Authority of Botswana; the State Administration for Market
Regulation of the People’s Republic of China (PRC) and the requisite majority of the relevant Shareholders
as required under the Listing Rules; and
• The group obtained new RCFs of US$300.0 million from CCB of which US$150.0 million is undrawn.

Financial and other risk management

Financial risk factors

The Group’s activities expose it to a variety of financial risks, including commodity price risk, interest rate
risk, foreign exchange risk, credit risk, liquidity risk and risk arising from the interest benchmark reform. The
Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to
minimise potential adverse effects on the Group’s financial performance. The Group can use derivative financial
instruments such as interest rate swaps, collar hedges and commodity swaps to manage certain exposures. The
Group does not and is prohibited from entering into derivative contracts for speculative purposes.

Financial risk management is carried out by the Group Treasury function under proposals approved by the Board.
Group Treasury identifies, evaluates and manages financial risks in close cooperation with the Group’s operating
units. The Board approves written principles for overall risk management, as well as policies covering specific
areas, such as those identified below.

(a) Commodity price risk

The prices of copper, zinc, lead, gold, silver and molybdenum are affected by numerous factors and events that
are beyond the control of the Group. These metal prices change on a daily basis and can vary significantly up
and down over time. The factors impacting metal prices include both broader macro-economic developments
and micro-economic considerations relating more specifically to the particular metal concerned.

During the year ended 31 December 2023, the Group entered into various commodity trades to hedge the sales
prices for copper and zinc. The outstanding commodity trades included:

• Zero/low-cost collar hedges:

՞ 3,000 tons of copper with put strike price of US$9,000/ton and call strike price of US$9,300/ton;

• Fixed price swap hedges:

՞ 24,500 tons of copper with fixed price ranging from US$8,607/ton to US$8,672/ton;

• Above hedges settlement ranged from January to April 2024.

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Management Discussion
and Analysis
Continued

A change in commodity prices during the year can result in favourable or unfavourable financial impact for
the Group.

The following table contains details of the hedging instrument used in the Group’s hedging strategy:

Favourable/(Unfavourable) Hedging
changes in fair value used for Settled portion gain/(loss)
Carrying measuring ineffectiveness of hedging recognised
amount of instrument in cash Cost of
hedging Hedging realised gains/ flow hedge hedging
instrument instrument Hedged item (losses) reserve reserve
Term US$ million US$ million US$ million US$ million US$ million US$ million
Cash flow hedges:
At 31 December 2023
Derivative financial March 2023 to
assets/(liabilities) December 2023 - - - 10.8 - -
At 31 December 2022
Derivative financial March 2022 to
assets/(liabilities) December 2022 - - - 47.0 - -

The following table details the sensitivity of the Group’s financial assets balance to movements in commodity
prices. Financial assets arising from revenue on provisionally priced sales are recognised at the estimated fair
value of the total consideration of the receivable and subsequently remeasured at each reporting date. At the
reporting date, if the commodity prices increased/(decreased) by 10% and taking into account the commodity
hedges, with all other variables held constant, the Group’s post-tax profit would have changed as set out below:

2023 2022
(Decrease)/
Commodity price Increase in profit Commodity price increase in profit
Commodity movement US$ million movement US$ million
Copper +10% 11.2 +10% (21.5)
Zinc +10% 7.2 +10% 0.3
Total 18.4 (21.2)

Commodity price Decrease in profit Commodity price Increase in profit

Commodity movement US$ million movement US$ million
Copper -10% (10.9) -10% 21.8
Zinc -10% (7.2) -10% -
Total (18.1) 21.8

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Management Discussion
and Analysis
Continued

(b) Interest rate risk

The Group is exposed to interest rate risk primarily through interest bearing borrowings and investment of
surplus cash holdings. Deposits and borrowings at variable rates expose the Group to cash flow interest rate risk.
Deposits and borrowings at fixed rates expose the Group to fair value interest rate risk.

The Group regularly monitors its interest rate risk to ensure there are no undue exposures to significant interest
rate movements. Any decision to hedge interest rate risk is assessed periodically in light of the overall Group’s
exposure, the prevailing interest rate market and any funding counterparty requirements. Regular reporting of the
Group’s debt and interest rates is provided to the MMG Executive Committee.

The Group is exposed to the risk-free rate of SOFR. The exposures arise on derivative and non-derivative
financial assets and liabilities. The Group cash flow hedge relationship was affected by the interest rate
benchmark reform. With the IRS closure, the cash flow hedge relationship was discontinued. The current
exposures mainly arise on non-derivative financial assets and liabilities.

The following table contains details of the cash flow hedge was affected by the IRS closure:

At 31 December 2023 and for year ended 31 December 2023

Amount reclassified
Balance in from the cash flow Line item affected
cash flow hedge reserve to in profit or loss
hedge reserve profit or loss because of the
US$ million US$ million reclassification
Discontinued Cash Flow Hedges: Financial cost,
Interest Rate Swap 40.2 37.0 Income tax expense

The following table contains details of the hedging instrument used in the Group’s hedging strategy as at 31
December 2022:

Favourable/(Unfavourable)
Settled portion
changes in fair value used for
Carrying of hedging Hedging gain Hedge
measuring ineffectiveness
Notional amount of instrument recognised ineffectiveness
amortising hedging Hedging realised gains/ in cash flow recognised in
amount instrument instrument Hedged item (losses) hedge reserve1 profit or loss
Term US$ million US$ million US$ million US$ million US$ million US$ million US$ million
Cash flow hedges:
At 31 December 2022
June
Derivative 2020
financial – June
assets2 2025 1,560 113.9 82.1 (82.1) 17.9 55.8 -

1 The hedging gain recognised in cash flow hedge reserve is the amount after tax.
2 In 2020, the Group has entered into a notional US$2,100 million 5-year amortising interest rate swap with BOC Sydney.

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Management Discussion
and Analysis
Continued

Interest rate sensitivity analysis

At 31 December 2023 and 2022, if the interest rate had increased/(decreased) by 100 basis points, taking into
account the interest rate swap, with all other variables held constant, post-tax profit and other comprehensive
income (OCI) would have changed as follows:

2023 2022
+100 basis points -100 basis points +100 basis points -100 basis points
Increase/ (Decrease)/ Increase/ (Decrease)/
(decrease) in increase in profit (decrease) in increase in
US$ million profit after tax after tax profit after tax Increase in OCI profit after tax Decrease in OCI
Financial assets
Cash and cash
equivalents 3.0 (3.0) 2.5 - (2.5) -
Financial liabilities
Borrowings (taking
into account the
impact of the
interest rate swap) (17.6) 17.6 (9.7) 13.6 9.7 (13.6)
Total (14.6) 14.6 (7.2) 13.6 7.2 (13.6)

(c) Foreign exchange risk

The Group operates internationally and is exposed to foreign currency exchange risk. The Group’s reporting
currency and functional currency of the majority of subsidiaries within the Group is US dollars. The majority of
revenue received by the Group is in US dollars. The Group’s foreign currency exchange risk arises predominantly
from the currency of the countries in which the Group’s operations are located. Any decision to hedge foreign
currency risk is assessed periodically in light of the Group’s exposure, the prevailing foreign currency market and
any funding counterparty requirements.

The following table shows the foreign currency risk arising from the monetary assets and liabilities, which are
shown by foreign currency of the Group.

US$ million US$ PEN A$ HK$ Others Total

At 31 December 2023
Financial assets
Cash and cash equivalents 425.3 16.5 0.8 0.4 4.0 447.0
Trade receivables 354.8 - - - - 354.8
Other receivables 30.9 211.4 6.8 - 0.1 249.2
Derivative financial assets 3.1 - - - - 3.1
Other financial assets 2.7 - - - - 2.7
Financial liabilities
Trade and other payables (459.3) (384.8) (52.0) - (6.8) (902.9)
Borrowings (4,707.1) - - - - (4,707.1)
Lease liabilities (118.8) (0.2) (28.6) - - (147.6)
(4,468.4) (157.1) (73.0) 0.4 (2.7) (4,700.8)

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Management Discussion
and Analysis
Continued

US$ million US$ PEN A$ HK$ Others Total

At 31 December 2022
Financial assets
Cash and cash equivalents 346.4 21.2 - 1.8 2.8 372.2
Trade receivables 212.7 - - - - 212.7
Other receivables 28.0 235.6 6.5 - - 270.1
Derivative financial assets 126.0 - - - - 126.0
Other financial assets 1.5 - - - 1.5
Financial liabilities
Trade and other payables (333.2) (332.6) (62.1) - (25.1) (753.0)
Borrowings (5,412.6) - - - - (5,412.6)
Lease liabilities (114.0) (0.2) (24.5) - - (138.7)
Derivative financial liabilities (0.3) - - - - (0.3)
(5,145.5) (76.0) (80.1) 1.8 (22.3) (5,322.1)

Based on the Group’s net monetary assets and financial liabilities at 31 December 2023 and 2022, a movement
of the US dollar against the principal non-functional currencies as illustrated in the table below, with all other
variables held constant, would cause changes in post-tax profit as follows:

2023 2022
Weakening Strengthening Weakening Strengthening
of US dollar of US dollar of US dollar of US dollar
Decrease in Increase in profit Decrease in Increasein profit
US$ million profit after tax after tax profit after tax after tax
10% movement in Australian dollar (2022: 10%) (5.1) 5.1 (5.6) 5.6
10% movement in Peruvian sol (2022: 10%) (10.7) 10.7 (5.2) 5.2
Total (15.8) 15.8 (10.8) 10.8

(d) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss
to the Group. The Group is exposed to counterparty credit risk through sales of metal products on normal terms of
trade, through deposits of cash and settlement risk on foreign exchange transactions. While the most significant
exposure to credit risk is through sales of metal products on normal terms of trade, the majority of sales for mining
operations were made under contractual arrangements whereby provisional payment is received promptly after
delivery and the balance within 30 to 120 days from delivery. 100% of the balance is aged less than 6 months
based on invoice date. The carrying amount of the Group’s trade receivables at FVTPL best represents their
respective maximum exposure to credit risk. The Group holds no collateral over any of these balances.

Investments in cash, short-term deposits and similar assets are with approved counterparty banks.
Counterparties are assessed prior to, during and after the conclusion of transactions to ensure exposure to
credit risk is limited to acceptable levels. There has been no change in the estimation techniques or significant
assumptions made during the year ended 31 December 2023 in assessing the ECL for these financial assets.
The limits are set to minimise the concentration of risks and therefore mitigate the potential for financial loss
through counterparty failure. Impairment is provided for where the credit risk is perceived to exceed the
acceptable levels and there are concerns on recoverability of the relevant assets. The management of the Group
considers cash and cash equivalents that are deposited with financial institutions with high credit rating to be
low credit risk financial assets.

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Management Discussion
and Analysis
Continued

Other receivables include balances related to various matters including other taxes, indemnities. These balances
are assessed at the reporting date considering contractual and non-contractual legal rights to receive such
amounts as well as the expectation of recoverability based on expert third party advice and management
assessment based on all available information. There are no significant increases in credit risk for these balances
since their initial recognition and the Group provided impairment based on a 12 month ECL. For the years ended
31 December 2023 and 2022, the Group assessed the ECL for these balances and considered no significant
impact to the consolidated financial statements.

The Group’s most significant customers are CMN, CITIC Metal Peru Investment Limited (CITIC Metal), and
Trafigura Pte Ltd (Trafigura). Revenue earned from these customers as a percentage of total revenue was:

2023 2022
CMN 46.6% 34.5%
CITIC Metal 20.2% 16.2%
Trafigura 8.2% 14.0%

The Group’s largest debtor at 31 December 2023 was CMN with a balance of US$159.1 million (2022: US$102.6
million) and the five largest debtors accounted for 77.6% (2022: 84.0% ) of the Group’s trade receivables. Credit
risk arising from sales to large concentrate customers is managed by contracts that stipulate a provisional
payment of at least 90% of the estimated value of each sale. For most sales a second provisional payment
is received within 60 days of the vessel arriving at the port of discharge. Final payment is recorded after
completion of the quotation period and assaying.

The credit risk by geographic region was:

At 31 December
US$ million 2023 2022
Asia 264.7 154.0
Europe 78.6 31.2
Australia 11.0 6.4
Other 0.5 21.1
354.8 212.7

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Management Discussion
and Analysis
Continued

(e) Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial
liabilities.

Management utilises short and long-term cash flow forecasts and other consolidated financial information to
ensure that appropriate liquidity buffers are maintained to support the Group’s activities.

The table below analyses the Group’s financial assets and liabilities into relevant maturity groupings based on the
remaining period at the reporting date to the contractual maturity date. The amounts disclosed in each maturity
grouping are the contractual undiscounted cash flows for financial instruments.

Between Between Total

Within 1 and 2 and Over carrying
US$ million 1 year 2 years 5 years 5 years Total value
At 31 December 2023
Financial assets
Cash and cash equivalents 447.0 - - - 447.0 447.0
Trade receivables 354.8 - - - 354.8 354.8
Other receivables 93.4 150.7 5.1 - 249.2 249.2
Derivative financial assets 3.1 - - - 3.1 3.1
Other financial assets 2.7 - - - 2.7 2.7
Financial liabilities
Trade and other payables (616.4) (286.5) - - (902.9) (902.9)
Borrowings (including interest) (1,599.6) (1,285.1) (1,899.6) (824.3) (5,608.6) (4,707.1)
Lease liabilities (including interest) (33.9) (32.6) (66.0) (73.7) (206.2) (147.6)
(1,348.9) (1,453.5) (1,960.5) (898.0) (5,660.9) (4,700.8)
At 31 December 2022
Financial assets
Cash and cash equivalents 372.2 - - - 372.2 372.2
Trade receivables 212.7 - - - 212.7 212.7
Other receivables 114.7 145.5 9.9 - 270.1 270.1
Derivative financial assets 75.0 51.0 - - 126.0 126.0
Other financial assets 1.5 - - - 1.5 1.5
Financial liabilities
Trade and other payables (535.5) (217.5) - - (753.0) (753.0)
Derivative financial liabilities (0.3) - - - (0.3) (0.3)
Borrowings (including interest) (1,510.1) (1,357.8) (2,530.6) (1,090.5) (6,489.0) (5,412.6)
Lease liabilities (including interest) (32.7) (25.4) (59.6) (85.4) (203.1) (138.7)
(1,302.5) (1,404.2) (2,580.3) (1,175.9) (6,462.9) (5,322.1)

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Management Discussion
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Country and community risks

The Group conducts all of its operations outside of Hong Kong and, as such, it is exposed to various levels of
political, economic and other risks and uncertainties. These risks and uncertainties vary from country to country.
Material risks include, but are not limited to, regime or policy change, fluctuation in currency exchange rates,
changes to licensing regimes and amendments to concessions, licences, permits and contracts, changing
political conditions and governmental regulations and community disruptions. Changes in any aspects above
and in the country where the Group operates may adversely affect the Group’s operations and profitability. The
decline in growth and macroeconomic activity in many developing nations has resulted in governments seeking
alternative means of increasing their income, including increases to corporate tax, VAT and royalty rates, coupled
with increased audit and compliance activity.

The DRC Government during 2018 made changes to the 2002 Mining Code and Mining Regulations. These
changes were enacted (2018 Mining Code) and continue to result in an increased tax burden on mining
companies; In Peru, over the past decades, Las Bambas has experienced heightened political instability with
succession of regimes with differing political policies. As the community disruptions and political situation are
expected to evolve in the near future, the Group will continue to work closely with the relevant authorities
and community groups to minimise the potential risk of social instability and disruptions to the Las Bambas
operations.

Some of the countries in which the Group operates carry higher levels of sovereign risk. Political and
administrative changes and reforms in law, regulations or taxation may impact sovereign risk. Political and
administrative systems can be slow or uncertain and may result in risks to the Group including the ability to
obtain tax refunds in a timely manner. The Group has processes in place to monitor any impact on the Group and
implement responses to such changes.

Contingent liabilities
Bank guarantees

Certain bank guarantees have been provided in connection with the operations of certain subsidiaries of the
Company primarily associated with the terms of mining leases, mining concessions, exploration licences or key
contracting arrangements. At the end of the reporting period, no material claims have been made under these
guarantees. The amount of these guarantees may vary from time to time depending upon the requirements of
the relevant regulatory authorities. At 31 December 2023, these guarantees amounted to US$310.5 million (2022:
US$297.5 million).

Contingent liabilities - tax related contingencies

The Group has operations in multiple countries, each with its own taxation regime. The nature of the Group’s
activities requires it to comply with various taxation obligations including corporation tax, royalties, withholding
taxes, transfer pricing arrangements with related parties, resource and production-based taxes, environmental
taxes and employment related taxes. Application of tax laws and interpretation of tax laws may require
judgement to assess risk and estimate outcomes, particularly in relation to the application of income taxes and
withholding tax to the Group’s cross-border operations and transactions. The evaluation of tax risks considers
both assessments received and potential sources of challenge from tax authorities. Additionally, the Group is
currently subject to a range of audits and reviews by taxation authorities in Australia, Peru, Zambia and the DRC.
No disclosure of an estimate of financial effect of the subject matter has been made in the consolidated financial
statements as, in the opinion of the management, such disclosure may seriously prejudice the position of the
Group in dealing with these matters.

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Tax matters with uncertain outcomes arise in the normal course of business and occur due to changes in tax
law, changes in interpretation of tax law, periodic challenges and disagreements with tax authorities, and legal
proceedings. The status of proceedings for such uncertain tax matters will impact the ability to determine the
potential exposure, and in some cases, it may not be possible to determine a range of possible outcomes,
including timing of resolution or determining a reliable estimate of the potential exposure.

Peru – Withholding Taxes (2014, 2015, 2016 and 2017)

Included within such uncertain tax matters are audits of the 2014, 2015, 2016 and 2017 tax periods for MLB in
relation to withholding taxes on interest and fees paid under certain loans, which were provided to MLB pursuant
to facility agreements entered into among MLB and a consortium of Chinese banks in connection with the
acquisition of the Las Bambas mine in 2014. MLB received assessment notices from the Peruvian tax authority
(National Superintendence of Tax Administration of Peru or “SUNAT”), which advised that, in its opinion, MLB
and the Chinese banks are related parties and thus a 30% withholding tax rate ought to be imposed rather than
the 4.99% applied. The assessments of omitted tax plus penalties and interest as at 31 December 2023 totalled
PEN2,069.5 million (approximately US$551.8 million) (31 December 2022: PEN2,015.1 million (approximately
US$527.5 million)).

In relation to these assessments, having received external legal and tax advice, the Group has formed the view
that the Company and its controlled entities are not related parties to Chinese banks under Peruvian tax law.
Additionally, the Peruvian tax law was amended (with effect from October 2017) to provide expressly that parties
are not related by being under state ownership for the purposes of withholding taxes. Las Bambas has appealed
the assessments issued by SUNAT in the Peru Tax Court and the pronouncement is pending. In parallel, MLB
filed an Amparo lawsuit to request a Constitutional Court the nullity of withholding tax Assessments due to the
violation of MLB’s constitutional rights in the issuance of SUNAT Assessments. Where MLB is not successful in
rebutting or appealing such challenge(s), this could result in significant additional tax liabilities.

Peru –Income Taxes (2016 and 2017)

• Peru –2016 Income Tax

In January 2023, Las Bambas received assessment notices from SUNAT in connection with the 2016
income tax audit (2016 Income Tax Assessment). The assessment denied the deductions for all interest on
borrowings expensed during the 2016 tax year. This included the loans from Chinese banks where SUNAT
denied the interest deductions on the basis that the borrowings were from related parties and that the alleged
related party debt should be included in calculating Las Bambas’ related party ‘debt to equity’ ratio (the ‘thin
capitalisation’ threshold) which would then be breached. SUNAT also alleged that interest payable on the
shareholder loan from MMG Swiss Finance A.G. is non-deductible, due to the application of the “Causality
Principle” (i.e., the loan has no relevance to the income-producing activities of Las Bambas). Further, SUNAT
separately alleged that the accounting treatment of the merger of Peruvian entities (subsequent to the
acquisition of Las Bambas in 2014) should have resulted in a negative equity adjustment which would result in
Las Bambas having no equity for the purposes of calculating its thin capitalisation allowance. The Assessment
issued by SUNAT for tax, interest and penalties for the income tax year 2016 totalled PEN651.0 million
(approximately US$173.0 million) as at 31 December 2023.

On 27 July 2023, SUNAT confirmed that it had considered Las Bambas’ appeal against the Assessment and
concluded that the Assessment remains correct and valid. Las Bambas will appeal to the Peru Tax Court.

• Peru –2017 Income Tax

In August 2023, Las Bambas received assessment notices from SUNAT in connection with the 2017 income
tax audit (2017 Income Tax Assessment). Similar to the 2016 Income Tax Assessment, SUNAT has continued
to challenge Las Bambas’ treatment of interest expense in the 2017 tax year on the same basis as that

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described above. Further, SUNAT has not recognised previous years’ tax losses, including 2014, 2015 and
2016 development costs (US$710 million). The Assessment for tax, interest and penalties for the income
tax year 2017 totalled PEN 3,610.4 million (approximately US$961.0 million) as at 30 November 2023.
However, on 30 November 2023 SUNAT issued Resolution No. 4070140000905 and declared the nullity of
tax debt. An updated Assessment for 2017 was received on 13 December 2023 and notified a tax debt of
PEN 3,460.2 million (approximately US$924.0 million).

Regarding the above SUNAT interpretations, management strongly disagrees and is of the view that SUNAT has
disregarded all available evidence and independent opinions on the accounting treatment, submitted by Las
Bambas for consideration during the 2016 and 2017 income tax assessment process. Further, in not recognising
prior years’ tax losses, SUNAT has failed to acknowledge the Tax Court decisions in respect of development
costs for the 2012 and 2013 years which were ruled in MLB’s favour. The risk remains that this treatment will also
be applied for future income tax years.

Las Bambas has notified the Peru Government of a dispute pursuant to the Peru-Netherlands Bilateral
Investment Treaty (Treaty) and the Peru Government has confirmed its inability to resolve the dispute by way
of commercial negotiation. Las Bambas is currently evaluating its legal options to seek damages from the
Government of Peru for a number of breaches of the Treaty.

Considering the Las Bambas’ proposed appeals and advice from the Las Bambas’ tax and legal advisers,
the Group did not recognise a liability in its consolidated financial statements for any assessed amount.
If Las Bambas is unsuccessful in its challenge on the SUNAT assessments, this could result in significant
liabilities being recognised.

Charges on assets
As at 31 December 2023, approximately US$2,016.8 million (31 December 2022: US$2,653.6 million) from China
Development Bank, Industrial and Commercial Bank of China Limited, BOC Sydney and The Export-Import
Bank of China was secured by share security over the entire share capital of MMG South America Management
Company Limited and each of its subsidiaries including MLB, a debenture over the assets of MMG South America
Management Company Limited, an assets pledge agreement and production unit mortgage in respect of all of
the assets of MLB, assignments of shareholder loans between MMG South America Management Company
Limited and its subsidiaries and security agreements over bank accounts of MLB.

Future prospects
MMG’s vision is to create a leading international mining company for a low-carbon future. We mine to create
wealth for our people, host communities and shareholders with an ambition to grow and diversify our resources,
production and value, by leveraging Chinese and international expertise. Our strong relationship with China
draws upon the strength of the world’s largest commodities consumer and provides a deep understanding of
markets and access to its sources of funding.

The Company is focused on maximising the value of our existing assets by increasing our safety performance,
improving competitiveness, containing costs, continually improving productivity, building successful relationships
with our host communities and governments and growing our resource base. We are actively pursuing our next
phase of disciplined growth.

In South America, Las Bambas’ copper production in 2024 is expected to be in the range of 280,000 and
320,000 tonnes. MMG expects to produce between 39,000 and 44,000 tonnes of copper cathode at Kinsevere,
and between 225,000 and 250,000 tonnes of zinc at its Dugald River and Rosebery operations in 2024.

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Las Bambas

Las Bambas annual production is expected to reach 350,000-400,000 tonnes in the medium term with the
extended contribution from the Chalcobamba project. Early works at Chalcobamba have now commenced and
the Las Bambas team is working toward enduring agreements for the development of the Chalcobamba deposit
with the Huancuire community. The continued development of Las Bambas is significant for the economy of Peru
and will support additional social contributions and financial and business opportunities for local and regional
communities.

Australia

In Australia, Dugald River remains committed to safe, greener and sustainable production to deliver annual ore
mined throughput of 2,000,000 tonnes in the future years. This will pave the way for targeted zinc equivalent
production to remain at around 200,000 tonnes annually. MMG will build on the already operational long-term
solar offtake agreement to pursue more green, reliable and cost-effective energy solutions, including supporting
CopperString 2032, which aims to connect Queensland’s North West Minerals Province to the National
Electricity Grid.

At Rosebery, an accelerated resource extension and near mine exploration drilling program is currently in
progress to support a mine life extension. MMG remains committed to extending the operating life of this
important asset, proactively investigating all feasible options to secure a sustainable tailings storage solution.

Kinsevere

In the DRC, MMG continues to progress the next phase of Kinsevere Expansion Project, namely the transition
to the mining and processing of sulphide ores. This project will extend Kinsevere’s mine life to at least 2035
and increase copper production back to around 80,000 tonnes of copper cathode per annum and 4,000 to
6,000 tonnes of cobalt in cobalt hydroxide. The cobalt plant was commissioned in the fourth quarter of 2023,
and the first production of cobalt hydroxide was achieved. The new tailing storage facility was commissioned
to support the cobalt plant ramp-up. The first copper cathode from sulphides is expected in the second half
of 2024, and a full ramp-up is expected in 2025. MMG will continue to invest in regional exploration programs
focusing on proving up discoveries within an operating radius of the Kinsevere mine.

Capital expenditure plan in 2024

Total capital expenditure in 2024 is expected to be between US$800 million and US$900 million.
US$400-450 million is attributable to Las Bambas, including the expansion of the Las Bambas tailings dam
facility, Ferrobamba pit infrastructure and Chalcobamba execution. At Kinsevere, capital expenditure related
to the Kinsevere Expansion Project is expected to be US$250-300 million. Should MMG successfully complete
the acquisition of the Khoemacau asset, additional capital expenditure will be required in 2024.

MMG will continue to focus on the next phase of growth. Currently, the company has no future plans for
material investments or capital assets sanctioned by the Board, other than those detailed in this report or
announced to the market.

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Directors and
Senior Management

Directors’ biographies
Chairman

MR XU JIQING

Mr Xu, aged 56, was redesignated from an Executive Director to a Non-executive Director of the Company in
January 2020 and was appointed as the Chairman of the Company in August 2023. Prior to his redesignation,
he was an Executive Director and Executive General Manager of the Company from May 2013 to December
2019 with responsibility for various areas, most recently China Relations, Marketing and Supply. Mr Xu was also
a Non‑executive Director of the Company from May 2009 to May 2013. He is a member of the Company’s Audit
and Risk Management Committee and the Governance, Remuneration, Nomination and Sustainability Committee.

Mr Xu was appointed as a director and the Chairman of China Minmetals Non-ferrous Metals Co., Ltd (CMN)
since February 2016 and September 2023 respectively. He was the President of CMN from January 2020 to
September 2023.

Mr Xu holds a Bachelor’s degree in Accounting from the University of International Business and Economics in the
PRC, and a Master’s degree in Business Administration from Saint Mary’s University in Canada. He is a qualified
senior accountant in the PRC, a fellowship member of the Certified General Accountants Association of Canada
and a chartered professional accountant member of the Chartered Professional Accountants of British Columbia,
Canada. Mr Xu has extensive experience in strategic planning, accounting, marketing and corporate financial and
risk management.

Mr Xu joined the CMC Group in 1991, holding a number of management roles from 1997 in various Finance
departments. He was the Vice President and CFO of CMN between 2005 and 2013.

Executive Director

MR LI LIANGANG

Mr Li, aged 59, was appointed as the Interim CEO and an Executive Director of the Company in January 2022.
He has served on the Executive Committee of the Company including as the Executive General Manager –
Commercial since January 2020 with responsibility for the Supply and Marketing functions, and the Executive
General Manager – Australia and Commercial from July 2020 to May 2022 with responsibilities for the Dugald
River and Rosebery operations and Australia support functions. He was appointed as the Executive General
Manager – Commercial and Development with effect from 1 February 2024. Mr Li was also responsible for the
Africa operations from January 2022 until May 2022. He is also a director of two subsidiaries of the Company.

Mr Li holds a Bachelor’s degree in English language from the Normal College for Foreign Language of Beijing
Union University in the PRC. He has extensive experience in international business and the non-ferrous metals
industry.

Mr Li joined CMC in 1987. He has held various senior management positions with subsidiaries of CMC in the
PRC, Australia, Mexico and the USA. Mr Li was also a Director of the Company from 2009 to 2012. He was a
Vice President of CMN in Beijing, leading several global trading departments from 2016 to 2018. Mr Li was the
President and CEO of Minmetals Inc. (L.A.) from 2018 to 2019.

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Non-executive Director

MR ZHANG SHUQIANG

Mr Zhang, aged 57, was appointed as a Non-executive Director of the Company in February 2017. He is a
member of the Company’s Audit and Risk Management Committee.

Mr Zhang has been the Auditor – General of CMC since August 2023; the General Manager of Audit Department
of CMC and Supervisor of China Minmetals Corporation Limited since April 2023. He was appointed as a director
of CMNH since January 2016 and was designated as a chairman of CMNH in February 2021. Mr Zhang was
the General Manager of the Finance Department of CMC from January 2016 to April 2023, a director of CMN
from February 2016 to March 2023, and a director of Minmetals HK since August 2016. He was the Chairman of
Minmetals Finance Co., Ltd. from September 2018 to April 2023. Mr Zhang was appointed as a director of China
Rare Earth Group Co., Ltd since December 2021.

Mr Zhang graduated from Zhejiang Metallurgical Economy College in the PRC, majoring in Financial Accounting.
He also obtained a Master’s degree in Economics from Wuhan University of Technology in the PRC.

Mr Zhang started his career at China National Nonferrous Metals Import and Export Corporation, working as the
Financial Accountant since 1987. From 1997 to 2000, he served as the Deputy Chief of the Finance Division of
China National Nonferrous Metals Industry Trading Group Corporation. From 2000 to 2002, Mr Zhang served as
the Assistant General Manager of the Finance Department of China National Nonferrous Metals Industry Trading
Group Corporation. He also served as the Assistant General Manager (from April 2002 to March 2003) and the
Deputy General Manager (from March 2003 to October 2005) of the Finance Department of CMN. From October
2005 to May 2013, Mr Zhang was the Deputy General Manager of the Finance Department of CMC. From May
2013 to December 2015, he served as the Vice President and the CFO of CMN and CMNH. From December 2015
to January 2016, Mr Zhang was the acting Deputy General Manager of the Finance Department of CMC. From
December 2016 to August 2018, he was a director of Minmetals Development Co., Ltd. From April 2017 to May
2020, Mr Zhang was a director of Minmetals Capital Co., Ltd. and from July 2017 to June 2020, he was a director
of Minmetals Innovative Investment Co., Limited. Mr Zhang was the Vice Chairman and a director of Xiamen
Tungsten Co. Ltd (a company listed on the Shanghai Stock Exchange) from January 2014 to December 2014. He
was also a director of Hunan Nonferrous Metals Holding Group Co., Ltd from August 2013 to January 2017 and a
director of China Tungsten and Hightech Materials Co., Ltd. (a company listed on the Shenzhen Stock Exchange)
from June 2016 to November 2018.

Independent Non-executive Directors

DR PETER CASSIDY

Dr Cassidy, aged 78, was appointed as an Independent Non-executive Director of the Company in December
2010. He is the Chairman of the Company’s Governance, Remuneration, Nomination and Sustainability Committee
and a member of Audit and Risk Management Committee.

Dr Cassidy is a metallurgical engineer with over 50 years’ experience in the resources and energy sectors,
including more than 30 years as a director of major public companies listed in Australia, Canada, the USA and
Hong Kong. Following his retirement from the position of CEO of Goldfields Limited in 2001, he has served as a
non-executive director on the Boards of companies involved in the base metals, precious metals and renewable
energy generation sectors. Dr Cassidy was also a member of the Board of Advice of Monash University Division
of Mining and Resources Engineering.

Dr Cassidy has most recently been involved in the development and operation of major mining and processing
projects in Australia, Peru, the PRC, Laos, Papua New Guinea, the DRC and Côte d’Ivoire.

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MR LEUNG CHEUK YAN

Mr Leung, aged 72, was appointed as an Independent Non-executive Director of the Company in July 2012. He is
a member of the Company’s Audit and Risk Management Committee and Governance, Remuneration, Nomination
and Sustainability Committee.

Mr Leung is a solicitor admitted to practise law in Hong Kong, England and Wales, and Victoria and the Australian
Capital Territory in Australia. He holds a Bachelor of Social Science (First Class Honours) degree from the
Chinese University of Hong Kong, and a Master of Philosophy degree from the University of Oxford. Mr Leung, a
corporate finance and capital markets specialist, was a partner at Baker & McKenzie and for many years the head
of its securities practice group in Hong Kong. He retired from Baker & McKenzie in 2011.

Mr Leung was an independent non-executive director of Bank of China Limited (a company listed on the Hong
Kong Stock Exchange and the Shanghai Stock Exchange) from September 2013 to September 2019.

MR CHAN KA KEUNG, PETER

Mr Chan, aged 72, was appointed as an Independent Non-executive Director, the Chairman of the Audit and
Risk Management Committee and a member of the Governance, Remuneration, Nomination and Sustainability
Committee of the Company in December 2019.

Mr Chan graduated from Hong Kong Polytechnic majoring in accounting. He is a member of Hong Kong Institute
of Certified Public Accountants, a fellow member of the Association of Chartered Certified Accountants of the
United Kingdom, an associate member of The Chartered Governance Institute (formerly known as The Institute
of Chartered Secretaries and Administrators) of the United Kingdom, and a member of CPA Australia.

From January 1994 to December 2008, Mr Chan served as Beijing-based managing partner of the Tax and
Investment Advisory Service Department and then managing partner of the NPA Transaction Advisory Service
Department of Ernst & Young. He also served as member of the executive committee of the Hong Kong Chamber
of Commerce in China from 1996 to 2003 and the Chairman of Hong Kong Chamber of Commerce in China in
2000 and 2003. Mr Chan was an independent non-executive director of CRRC Corporation Limited (a company
listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange) from June 2014 to May 2018. He
was also an independent non-executive director of Metallurgical Corporation of China Ltd. (a company listed on
the Hong Kong Stock Exchange and the Shanghai Stock Exchange) and China Railway Signal & Communication
Corporation Limited (a company listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange)
from November 2015 to April 2020 and from August 2018 to February 2022 respectively.

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Biographies of senior management

MR TROY HEY, EXECUTIVE GENERAL MANAGER – CORPORATE RELATIONS

Mr Hey, aged 53, has served on the Executive Committee of the Company since August 2013 in his capacity as
the Executive General Manager − Stakeholder Relations. His present role title is Executive General Manager –
Corporate Relations. In this role, he is responsible for Stakeholder Relations, Corporate Affairs, Human Resources,
Global Business Services, Technology and Legal and Company Secretarial. Mr Hey is also a director of a number
of subsidiaries of the Company.

Prior to joining the Company as General Manager − Stakeholder and Investor Relations in April 2011, Mr Hey
was the General Manager − Media and Reputation at Foster’s Group since 2005. He was previously the Group
Manager − Public Affairs for WMC Resources Limited, up to its acquisition by BHP Billiton Limited in 2005. Mr Hey
began his career in economic and public policy consultancy at the Allen Consulting Group and Australian Centre
for Corporate Public Affairs, before working across the aviation, entertainment and mining sectors.

Mr Hey has over 20 years’ experience in government, media, community and investor relations, economic and
public policy, industry association and communications management.

Mr Hey has dual degrees in Law and Commerce from the University of Melbourne and is the recipient of an
Australia-Japan Foundation Language Scholarship at Kwansei Gakuin University, Nishinomiya, Japan.

MR WEI JIANXIAN, EXECUTIVE GENERAL MANAGER – AMERICAS

Mr Wei, aged 58, has served on the Executive Committee of the Company since December 2019 in his capacity
as the Executive General Manager – Americas. He is also a director of a number of subsidiaries of the Company.

Mr Wei was appointed as a director and the Chairman of Lumina Copper SAC in October 2020.

Prior to joining the Company, Mr Wei was the President of Minmetals Mining Holdings Limited. He previously held
the positions of the President of Minmetals Hanxing Mining Co., Ltd and the President of Anhui Kaifa Mining Co.,
Ltd., managing the construction and operation of one of the China’s largest underground mines.

Mr Wei has over 30 years of both open pit and underground mining experience covering operations management
and mine planning.

Mr Wei is a Professoriate Senior Engineer of Mining and holds a Bachelor’s degree in Mining Engineering from The
Beijing Institute of Iron and Steel Engineering (now known as University of Science and Technology Beijing) in the
PRC.

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MR NAN WANG, EXECUTIVE GENERAL MANAGER – OPERATIONS

Mr Wang, aged 51, has served on the Executive Committee of the Company since May 2022 in his capacity as
the Executive General Manager – Australia and Africa and redesignated as the Executive General Manager –
Operations which has integrated group operational accountability with operational excellence since 1 February
2024. He is also a director of a number of subsidiaries of the Company.

Mr Wang is a mining executive with over 20 years of management, technical and operational experience, in open
cut and underground operations. He previously spent over six years at MMG in Australia as Group Manager
Mining between 2013 and 2019 and had extensive knowledge of MMG’s operations.

Prior to his time at MMG, Mr Wang worked with Gold Fields Limited as Vice President and Head of Technical
Services for West African Regional operations in Ghana. He also previously worked for various mining companies
in different commodities.

Mr Wang has a Bachelor of Engineering – Mining (Honours), University of Queensland, Australia and is a Member
of the Australian Institute of Mining and Metallurgy (MAusIMM).

MR QIAN SONG, EXECUTIVE GENERAL MANAGER – FINANCE

Mr Qian, aged 52, was appointed as Executive General Manager – Finance of the Company with effect from 1
February 2024. He brings to the role significant executive experience within CMC and was most recently the
CFO of Minmetals Innovative Investment Co., Limited. Prior to this role, Mr Qian was the Vice President of Capital
Markets of CMC from 2019 to 2022. He was also employed by the Company from 2010 to 2012 in the role of
Group Manager Board Support.

Mr Qian has over 3 decades of invaluable experience in global treasury systems and a profound understanding of
commercial and investment banking, financial markets, and cross-cultural integration in mining assets as well as
multi-industrial assets, both domestically and internationally.

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Directors’ Report

The board of directors of the Company (Board) is pleased to present the Annual Report together with the audited
Financial Statements of the Group for the year ended 31 December 2023.

Principal activities
The principal activities of the Group during the financial year were exploration, development and mining of
copper, zinc, cobalt, gold, silver, molybdenum and lead deposits around the world.

The full details of the principal activities of the Company’s subsidiaries are set out in Note 15 to the Consolidated
Financial Statements.

An analysis of the Group’s revenue for the year ended 31 December 2023 by reportable segments, together with
their respective contributions to profit from operations (EBIT), is set out in Note 4 to the Consolidated Financial
Statements.

Strategy and business review

MMG’s vision is to create a leading international mining company for a low carbon future. We mine to create
wealth for our people, host communities and shareholders with an ambition to grow and diversify our resource,
production and value, by leveraging Chinese and international expertise.

MMG has established strong foundations that support future growth and development. The Company has four
strategic drivers that are embedded into corporate planning and decision-making processes:

• China Champion: Building on the strength of the world’s largest commodity consumer to create a sustainable
competitive advantage.
• Business Miner: Adopting a mindset that leverages excellence in owning and operating mines to generate
superior returns on investment, enhancing our ability to fund and deliver future growth.
• Federation of MMG: Embracing the advantages of an empowered and diverse operating structure with core
group disciplines and guiding values that drive a unique way of working across our international footprint.
• Delivering Progress: Taking pride in mining’s role in driving social progress through local, regional and national
contributions and delivering materials for a changing world.

Aligned with achievement of its ambitions, the Company is structured along the following lines:

• Operations: Largely self-sufficient sites, with regional offices driving local efficiencies.
• Group Operations Support: A limited number of experts in areas critical to the operation of the global asset
base.
• Global Services: Lowest cost delivery of truly global and shared activities.
• Corporate: A lean corporate office, based in Melbourne and Beijing, focused on only what is needed to operate
and govern a listed business and deliver inorganic growth.

The Board is committed to sustaining the successful model that brings together the best fit management team
and a strong relationship with China that draws upon the strength of the world’s largest commodities consumer,
provides deep understanding of markets and access to its sources of funding.

The Company is focused on containing costs, continually improving productivity, growing its resource base and
maintaining a strong balance sheet while pursuing disciplined growth.

A review of the business of the Group during the year, possible risks and uncertainties that the Group may be
facing, and a discussion on the Group’s future business development are provided in the Chairman’s Review,
CEO’s Report and the Management Discussion and Analysis in this Annual Report.

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Continued

In addition to financial performance, the Group maintains a belief that a high standard of corporate social
responsibility is essential for building good corporate and social relationships, motivating staff and creating
sustainable returns. Further discussion on the Group’s environmental policies and performance, relationships with
its key stakeholders and compliance with relevant laws and regulations which have a significant impact on the
Group is provided on pages 97 to 109 of this Annual Report.

Major customers and suppliers

During the year, sales to the largest customer and the five largest customers in aggregate accounted for
approximately 41.3% and approximately 78.4% of the total sales of the Group respectively. Purchases from the
five largest suppliers to the Group in aggregate accounted for approximately 16.9% of the total purchases of the
Group during the year.

Apart from CMC, the ultimate controlling Shareholder, having an interest of approximately 88.4 % in one of the
five largest customers, none of the Directors or any of their close associates or any Shareholders (which to the
knowledge of the Directors, owned more than 5% of the total number of issued shares of the Company) had any
beneficial interest in any of the five largest customers or suppliers of the Group.

Results and appropriations

The results of the Group for the year ended 31 December 2023 are set out in the Consolidated Statement of
Profit or Loss in the Financial Statements on page 117 of this Annual Report.

No interim dividend was declared for 2023 (2022: nil). The Board does not recommend the payment of a final
dividend for the year ended 31 December 2023 (2022: nil).

Reserves
Movements in reserves of the Group during the year are set out in Note 24 to the Consolidated Financial
Statements.

Distributable reserves
Details of the distributable reserves of the Company as at 31 December 2023 are set out in Note 24 to the
Consolidated Financial Statements.

Property, plant and equipment

Movements in property, plant and equipment during the year are set out in Note 12 to the Consolidated Financial
Statements.

Borrowings
Particulars of borrowings of the Group, as at 31 December 2023, are set out in Note 25 to the Consolidated
Financial Statements.

During 2023, the Company and its subsidiaries continued to maintain loan agreements that included conditions
imposing specific performance obligations on a controlling Shareholder. A breach of such an obligation would
cause a default in respect of loans that are significant to the operations of the issuer, the details of which are set
out below.

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Loan agreements with covenants relating to specific performance of the controlling shareholder

In accordance with the continuing disclosure requirements under Rule 13.21 of the Listing Rules, following are the
details of the Group’s facility agreements that contain covenants requiring specific performance obligations of the
controlling Shareholders.

1. Facility granted by China Development Bank, Bank of China Limited, Sydney Branch, Bank of
Communications Co., Ltd. and The Export-Import Bank of China to Minera Las Bambas S.A.

On 19 October 2020, Minera Las Bambas S.A. (MLB) entered into a US$800.0 million three‑year credit facility
for its operational funding requirements with each of CDB, BOC Sydney, ICBC Macau and EXIM Bank, (2020
Las Bambas Facility). In June 2022, ICBC Macau transferred its interests in the 2020 Las Bambas Facility to
BOCOM.

On 29 September 2023, the all outstanding amounts were repaid in full, and the 2020 Las Bambas Facility
was terminated.

Up until 20 September 2023, under the 2020 Las Bambas Facility, upon the occurrence of the following
events, CDB, BOC, BOCOM and EXIM may, by not less than 20 days’ notice to MLB, declare all outstanding
loans under their respective facility agreement immediately due and payable:

(a) China Minmetals Corporation (CMC) ceases to beneficially hold more than 50% of the issued share
capital of the Company; or

(b) CMC ceases to have the power, directly or indirectly, to:

(i) cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at
a general meeting of the Company; or

(ii) appoint or remove all, or the majority, of the directors or other equivalent officers of the Company; or

(iii) give directions with respect to the operating and financial policies of the Company with which the
directors or other equivalent officers of the Company are obliged to comply.

The same control requirements are imposed on the Company in relation to its interest in and control of
MLB, failing which CDB, BOC Sydney, BOCOM and EXIM Bank may also cancel commitments and declare all
outstanding loans under their respective facility agreement immediately due and payable.

2. Facility granted by Industrial and Commercial Bank of China Limited to MMG Finance Limited

On 21 December 2020, MMG Finance Limited (MMG Finance) entered into a facility agreement (ICBC Facility)
pursuant to which ICBC agreed to provide MMG Finance with a US$300.0 million revolving credit facility for a
term of three years for general corporate purposes. The outstanding amount of US$300.0 million was repaid in
full in December 2023.

On 15 December 2023, the ICBC Facility was renewed for a further three years until 15 December 2026. As at
31 December 2023, the ICBC Facility was undrawn.

Under the ICBC Facility, an event of default will occur in the event that the Company ceases to be a subsidiary
of CMN, or MMG Finance ceases to be a wholly owned subsidiary of the Company, and ICBC is entitled to
declare all outstanding loans under the facilities immediately due and payable.

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3. Facility granted by Bank of China Limited, Sydney Branch to MLB

On 26 April 2023, MLB entered into a US$275.0 million three-year revolving loan facility for its general
funding requirements with BOC Sydney (2023 BOC Facility). The 2023 BOC Facility replaced the US$175.0
million working capital facility that BOC Sydney granted to MLB from August 2019 to August 2022. As at 31
December 2023, the 2023 BOC Facility was undrawn.

Under 2023 BOC Facility, upon the occurrence of the following events, BOC Sydney may, by not less than 5
days’ notice to MLB, declare all outstanding loans under the facility agreement due and payable:

(a) CMC ceases to beneficially hold more than 50% of the issued share capital of the Company; or

(b) CMC ceases to have the power, directly or indirectly, to:

(i) cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at
a general meeting of the Company;

(ii) appoint or remove all, or the majority, of the directors or other equivalent officers of the Company; or

(iii) directions with respect to the operating and financial policies of the Company with which the
directors or other equivalent officers of the Company are obliged to comply.

The same control requirements are imposed on the Company in relation to its interest in, and control of MLB,
failing which the Lenders may also declare all outstanding loans under the Facility Agreement immediately due
and payable.

4. Facility granted by Industrial and Commercial Bank of China Limited, Panama Branch to MLB

On 18 June 2023, MLB entered into a US$150.0 million revolving credit facility for working capital funding
with ICBC Panama, (June 2023 ICBC Facility). The June 2023 ICBC Facility is comprised of three tranches of
US$50.0 million available with a term of three years and to be drawn pursuant to facility agreements with the
ICBC Panama. The June 2023 ICBC Facility replaced the US$175.0 million working capital facility that ICBC
Luxembourg granted to MLB from August 2019 to August 2022. As at 31 December 2023, the June 2023
ICBC Facility was undrawn.

Under the June 2023 ICBC Facility, upon the occurrence of the following events, ICBC Panama may, by not
less than 3 days’ notice to MLB., declare all outstanding loans under the facility agreements immediately due
and payable:

(a) CMC ceases to beneficially hold more than 50% of the issued share capital of the Company; or

(b) CMC ceases to have the power, directly or indirectly, to:

(i) cast, or control the casting of, more than 50% of the maximum number of votes that might be
cast at a general meeting of the Company;

(ii) appoint or remove all, or the majority, of the directors or other equivalent officers of the
Company; or

(iii) give directions with respect to the operating and financial policies of the Company with which
the directors or other equivalent officers of the Company are obliged to comply.
The same control requirements are imposed on the Company in relation to its interest in and control of MLB,
failing which the lenders may also declare all outstanding loans under the facility agreements immediately due
and payable.

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Five-year financial summary

A summary of the results and of the assets and liabilities of the Group for the past five financial years is set out
on pages 204 to 205 of this Annual Report.

Share capital
Details of the movements in the Company’s share capital are set out in Note 23 to the Consolidated Financial
Statements.

Donations
Donations made by the Group during the year for charitable and community purposes amounted to
approximately US$226,184.

Directors
The Directors who held office during the year and up to the date of this report are as follows:

Chairman

Mr XU Jiqing (Non-executive Director)

(Appointed as the Chairman of the Company on 18 August 2023)

Mr JIAO Jian (Non-executive Director)

(Resigned as the Chairman of the Company on 31 March 2023)

Executive Director

Mr LI Liangang (Interim CEO)

Non-executive Director

Mr ZHANG Shuqiang

Independent Non-executive Directors

Dr Peter CASSIDY

Mr LEUNG Cheuk Yan

Mr CHAN Ka Keung, Peter

In accordance with article 98 of the articles of association of the Company, Mr Li Liangang will retire by rotation
at the forthcoming AGM and, being eligible, offer himself for re-election.

In accordance with article 98 of the articles of association of the Company and code provision B.2.2 in the
Appendix C1 of the Listing Rules, Mr Leung Cheuk Yan will retire by rotation at the forthcoming AGM and, being
eligible, offer himself for re-election.

The Company has received from each of the Independent Non-executive Directors an annual confirmation of
independence pursuant to Rule 3.13 of the Listing Rules and considers them to be independent.

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Directors’ service contracts

No Director proposed for re-election at the forthcoming AGM has an unexpired service contract that is not
determinable by the Company or any of its subsidiaries within one year without payment of compensation, other
than normal statutory compensation.

Directors’ interests in transaction, arrangement or contract of significance

No contracts of significance to which the Company, any of its holding companies, or any of their subsidiaries
was a party, in which a Director had a material interest, subsisted at the end of the year or at any time during the
year.

Directors’ interests and short positions in shares, underlying shares and debentures
As at 31 December 2023, the interests and short positions of the Directors and the CEO of the Company or any
of their associates in the shares, underlying shares and debentures of the Company or any of its associated
corporations (within the meaning of Part XV of the Securities and Futures Ordinance (SFO)), which were required
to be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of
the SFO (including interests and short positions which they are taken or deemed to have under such provisions
of the SFO), or which were required to be recorded in the register required to be kept pursuant to Section 352 of
the SFO or which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to
the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing
Rules (Model Code) were as follows:

Long position in the shares and the underlying shares of the company as at
31 December 2023
Number of underlying shares held
Approximate percentage
Nature of Number of Performance of total number of
Name of Director interest shares held Options awards issued shares (%)3
LI Liangang 1
Personal 764,962 - 2,009,859 0.03
XU Jiqing 2
Personal 940,050 - - 0.01

Notes:
1 The interests of Mr Li Liangang in the 764,962 shares were from the vested performance awards granted to him under 2020 Performance Awards
which were subject to meeting performance conditions and vested on 1 June 2023. The interests in the 2,009,859 performance awards were granted
under 2021 and 2022 Performance Awards, details of which are set out under the section headed ‘Performance Awards’ on pages 72 to 74 of this
Annual Report.
2 The 940,050 shares held by Mr Xu Jiqing were the balance of the vested performance awards granted to him under 2015 Performance Awards in 2015
and 2016 which were subject to holding locks for various periods of up to three years after vesting in 2018.
3 The calculation is based on the number of shares and/or underlying shares as a percentage of the total number of issued shares of the Company (that
is, 8,656,047,188 shares) as at 31 December 2023.

Save as disclosed above, as at 31 December 2023, none of the Directors or the CEO of the Company or any
of their associates had any interests or short positions in any shares, underlying shares or debentures of the
Company or any of its associated corporations (within the meaning of Part XV of the SFO), which were required
to be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of
the SFO (including interests and short positions, which they are taken or deemed to have under such provisions
of the SFO), or which were required to be entered in the register required to be kept pursuant to Section 352
of the SFO or which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant
to the Model Code. In addition, none of the Directors or the CEO of the Company or any of their associates had

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been granted or had exercised any rights to subscribe for any equity or debt securities of the Company or any of
its associated corporations (within the meaning of Part XV of the SFO) during the year ended 31 December 2023.

Directors’ interests in competing businesses

During the year ended 31 December 2023, the interests of Directors in a business that competes or is likely to
compete with the businesses of the Group, as defined in the Listing Rules, are as follows:

1. Mr Jiao Jian, former Non-executive Director and Chairman of the Company (resigned as the Chairman and
Non-executive Director of the Company on 31 March 2023), was:

• a Vice President of CMC;

• a director and the President of CMCL; and
• the Chairman of CMN.

2. Mr Xu Jiqing, a Non-executive Director and Chairman of the Company, is/was:

(appointed as Chairman of the Company on 18 August 2023)
• a director and the Chairman of CMN; and
• The President of CMN until September 2023.

3. Mr Zhang Shuqiang, a Non-executive Director of the Company, is/was:

• the General Manager of the Finance Department of CMC until April 2023;
• the Auditor – General of CMC;
• a director of CMNH;
• a director of CMN until March 2023;
• a director of Minmetals HK; and
• the Chairman of Minmetals Finance Co., Ltd until April 2023.

Although the Group and the above companies are involved in businesses in the same industry, they are separate
companies operated by separate and independent management. The Company is therefore capable of carrying
on its business independently of, and at arm’s length from, the CMC Group.

Permitted indemnity and directors’ and officers’ liability insurance

Pursuant to the articles of association of the Company and subject to the provisions of the Companies
Ordinance, every Director or other officer of the Company shall be indemnified out of the assets of the Company
against all loss and liabilities which he/she may sustain or incur in or about the execution of the duties of his/her
office or otherwise in relation thereto, provided that such Article shall only have effect in so far as its provisions
are not avoided by the Companies Ordinance. The Company has arranged appropriate Directors’ and officers’
liability insurance coverage for the Directors and officers of the Company during the year.

Share option scheme

2013 Share option scheme

Pursuant to share option scheme adopted at the extraordinary general meeting of the Company (EGM) held on
26 March 2013 (2013 Share Option Scheme), options were granted to eligible participants under 2016 Options.
The option period of 2013 Share Option Scheme has been expired in May 2023. As at 31 December 2023, there
were no options outstanding which granted under 2016 Options.

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The following is a summary of the principal terms of the 2013 Share Option Scheme:
1. Purpose
The purpose of the 2013 Share Option Scheme is to enable the Company to grant awards to selected
employees of the Group as incentives or rewards for their contribution or potential contribution to the
development and growth of the Group.
2. Participants
The Company may grant an option to anyone who is an employee of the Company, its subsidiaries or any
other company that is associated with the Company and is so designated by the Directors on the date of
grant.
3. Total number of shares available for issue under the 2013 Share Option Scheme
There are no outstanding shares available for issue under the 2013 Share Option Scheme as at the date of
this report.
4. Maximum entitlement of each participant
No option may be granted to any eligible person which, if exercised in full, would result in the total number
of shares issued and to be issued upon exercise of the options already granted and to be granted to such
eligible person under the 2013 Share Option Scheme (including exercised, cancelled and outstanding options)
in the 12-month period up to and including the date of such new grant exceeding 1% of the total number of
issued shares of the Company as at the date of such new grant. Any grant of further options above this limit
shall be subject to the requirements under the Listing Rules.
5. Period within which the shares must be taken up under an option
The Board may in its absolute discretion determine the period during which an option may be exercised, save
that such period shall not be more than 10 years from the date on which such option is granted and accepted
subject to the provisions for early termination.
6. Minimum period for which an option must be held before it can be exercised
The minimum period for which an option must be held before it can be exercised is 12 months from the date
of grant, subject to the Board having the right to determine a longer minimum period at the time of granting
the option.
7. Time of acceptance and the amount payable on acceptance of the option
No amount is payable upon application or acceptance of an option.
8. Basis of determining the exercise price
The exercise price shall be determined by the Board at the time of grant of the relevant option and shall not
be less than the highest of:
• the closing price per share of the Company as stated in the Hong Kong Stock Exchange’s daily quotations
sheet on the date of grant of the relevant option; and
• an amount equivalent to the average closing price per share of the Company as stated in the Hong Kong
Stock Exchange’s daily quotations sheets for the five business days immediately preceding the date of
grant of the relevant option.
9. The remaining life of the 2013 Share Option Scheme
The 2013 Share Option Scheme was expired in March 2023.

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2016 options

On 15 December 2016, the Company granted options to the eligible participants pursuant to the 2013 Share
Option Scheme (2016 Options). The exercise period of 2016 Options expired in May 2023. There were no options
outstanding as at 31 December 2023.

During the year ended 31 December 2023, the movements of the 2016 Options were as follows:

Number of options
Exercise
price per Balance as Granted Exercised Lapsed Balance as at
Category of share Exercise at 1 January during the during the during the 31 December
participant Date of grant1 (HK$) Period2 2023 year year3 year4 2023
Employees of 15 December 4 years after the
the Group 2016 2.29 date of vesting 3,261,984 - (3,158,983) (103,001) -
TOTAL 3,261,984 - (3,158,983) (103,001) -

Notes:
1 The closing price of the shares of the Company immediately before the date on which the options were granted on 15 December 2016 was HK$2.25
per share.
2 The vesting and performance period of the options is three years from 1 January 2016 to 31 December 2018, with 60% of vested options exercisable
from 1 January 2019 and 40% of the vested options subject to a 12-month exercise deferral period, such options being exercisable after 1 January
2020. The vesting of options is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant
including, among others, achievement of resources growth and market-related performance targets during the vesting period. Options vest on a
percentage basis based on the target performance level achieved. Achievement of the Company and individual performance conditions have resulted
in 33.33% of the 2016 Options granted to participants vesting on 22 May 2019.
3 The weighted average closing price of the shares of the Company immediately before the date on which the options were exercised was HK$2.83.
4 Options lapsed due to the expiry of the exercise period.
5 No options were cancelled during the year.

The estimated fair value of the options granted on 15 December 2016 was approximately US$0.1371 each,
estimated as at the date of grant by using the Black-Scholes option-pricing model.

The value of the share options was subject to a number of assumptions and limitations of the option-pricing
model, including a risk-free interest rate, option price volatility, expected life of the option, market price of the
Company’s shares and expected dividend. The risk-free interest rate was 1.89%, the expected volatility used in
calculating the value of options was 40% and the expected dividend was assumed to be nil.

The validity period of the options is from the date of vesting until four years from 22 May 2019 to 22 May 2023.
The vesting and performance period of the options was three years from 1 January 2016 to 31 December 2018.
The 2016 Options vested with an overall outcome of 33.33% of the target values on 22 May 2019. In accordance
with the terms and conditions of the 2016 Options, if a participant ceased employment before the expiry of the
vesting period, the option would lapse unless the participant departed due to certain specific reasons including
ill-health, injury or disability, retirement with the agreement of the employer, redundancy, death, the participating
employing company ceasing to be part of the Group and any other reason, subject to approval by the Board. In
addition, if a participant ceased employment after expiry of the vesting period, the option would lapse six months
after the date the participant ceased to be an employee.

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Performance awards
The purpose of the performance awards is to assist in the retention and incentivisation of selected employees of
Members of the Group and align their interests with the development and growth of the Group.

The Company may grant performance awards to anyone who is an employee of the Group or any other company
that is associated with the Company and is so designated by Directors.

The Governance, Nomination, Remuneration and Sustainability Committee has reviewed the following plans for
approval by the Board from 1 January 2023 to 31 December 2023:

• Structure of the 2023 Long-Term Incentive (LTI) Plan; and Implement cash plan in place of the LTI Equity Plan if
approval for the new 10-year LTI Umbrella Plan cannot be obtained by 31 March 2023;
• Vesting of 33.33% of Performance Share Awards under 2020 Long-Term Incentive Plan; and
• Review 2024 Long-Term Incentive Plan.

Pursuant to the performance awards granted under the Long-Term Incentive Equity Plan, performance awards
were granted to eligible participants under the 2020 Performance Awards, 2021 Performance Awards and 2022
Performance Awards. As at 31 December 2023, there were a total of 39,800,298 performance awards granted
under the 2021 Performance Awards and 2022 Performance Awards, which represented approximately 0.46% of
the total number of issued shares of the Company as at that date.

2020 Performance awards

On 29 April 2020, the Company granted performance awards to the eligible participants pursuant to the
Long‑Term Incentive Equity Plan (2020 Performance Awards). There were a total of 13,120,972 new shares were
issued and no performance awards outstanding as at 31 December 2023 as a result of vesting was completed in
June 2023.

During the year ended 31 December 2023, the movements of the 2020 Performance Awards were as follows:

Number of performance awards

Balance as Granted Vested Cancelled Lapsed Balance as at
Category and name of at 1 January during the during during during the 31 December
participant Date of grant2 2023 year the year the year year3 2023
Director
LI Liangang1 29 April 2020 2,295,115 - (764,962) - (1,530,153) -
Employees of the Group 29 April 2020 45,943,153 - (12,356,010) - (33,587,143) -
TOTAL 48,238,268 - (13,120,972) - (35,117,296) -

Notes:
1 Upon vesting in June 2023, a portion of the performance awards of 764,962 were vested and 1,530,153 performance awards were lapsed during the
vesting period.
2 The vesting and performance period of the performance awards is three years from 1 January 2020 to 31 December 2022. The vesting of
performance awards is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant including,
among others, achievement of resources growth, financial and market-related performance targets during the vesting period. Performance awards
vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the vested performance awards will be subject
to holding locks for various periods of up to two years after vesting. The performance awards are granted for nil cash consideration. Achievement of
the Company and individual performance conditions have resulted in 33.33% of the 2020 Performance Awards granted to participants vesting on 1
June 2023. The closing price on the vesting date and the date before the vesting date were HK$2.39 and HK$2.35 respectively. The closing price of
the Shares of the Company immediately before the date on which the performance awards were granted on 29 April 2020 was HK$1.34 per share.
3 Performance awards lapsed due to non-achievement of some performance conditions during the vesting period and cessation of employment during
the year.

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The estimated fair value of the performance awards granted on 29 April 2020 was approximately US$0.1462
each, estimated at the date of grant by using Monte Carlo Simulations (for market-based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk-free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 0.80%; the expected volatility used in calculating the value of performance awards was 60.29% and the
expected dividend was assumed to be nil.

2021 Performance awards

On 21 June 2021, the Company granted performance awards to the eligible participants pursuant to the Long-
Term Incentive Equity Plan (2021 Performance Awards). There were 13,665,443 performance awards outstanding
as at 31 December 2023, representing approximately 0.16% of the total number of issued shares of the Company
as at that date.

During the year ended 31 December 2023, the movements of the 2021 Performance Awards were as follows:

Number of performance awards

Balance as Granted Vested Cancelled Lapsed Balance as at
Category and name of at 1 January during the during the during the during the 31 December
participant Date of grant2 2023 year year year year3 2023
Director
LI Liangang1 21 June 2021 760,615 - - - - 760,615
Employees of the Group 21 June 2021 14,060,567 - - - (1,155,739) 12,904,828
TOTAL 14,821,182 - - - (1,155,739) 13,665,443

Notes:
1 Mr Li Liangang was appointed as the Interim CEO and an Executive Director of the Company on 5 January 2022. He was granted 760,615 performance
awards on 21 June 2021.
2 The vesting and performance period of the performance awards is three years from 1 January 2021 to 31 December 2023. The time of vesting will
be on or around June 2024. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market- related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration. The closing price of the Shares of the Company immediately before the date on which the performance awards were
granted on 21 June 2021 was HK$3.39 per share.
3 Performance awards lapsed due to cessation of employment during the year.

The estimated fair value of the performance awards granted on 21 June 2021 was approximately US$0.3928
each, estimated at the date of grant by using Monte Carlo Simulations (for market-based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk‑free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 0.45%; the expected volatility used in calculating the value of performance awards was 69.06% and the
expected dividend was assumed to be nil.

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2022 Performance awards

On 21 April 2022, the Company granted performance awards to the eligible participants pursuant to the Long-
Term Incentive Equity Plan (2022 Performance Awards). There were 26,134,855 performance awards outstanding
as at 31 December 2023, representing approximately 0.30% of the total number of issued shares of the Company
as at that date.

During the year ended 31 December 2023, the movements of the 2022 Performance Awards were as follows:

Number of performance awards

Balance as Granted Vested Cancelled Lapsed Balance as at
Category and name of at 1 January during the during the during the during the 31 December
participant Date of grant1 2023 year year year year 2 2023
Director
LI Liangang 21 April 2022 1,249,244 - - - - 1,249,244
Employees of the Group 21 April 2022 26,802,050 - - - (1,916,439) 24,885,611
TOTAL 28,051,294 - - - (1,916,439) 26,134,855

Notes:
1 The vesting and performance period of the performance awards is three years from 1 January 2022 to 31 December 2024. The time of vesting will
be on or around June 2025. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration. The closing price of the Shares of the Company immediately before the date on which the performance awards were
granted on 21 April 2022 was HK$3.50 per share.
2 Performance awards lapsed due to cessation of employment during the year.

The estimated fair value of the performance awards granted on 21 April 2022 was approximately US$0.4114
each, estimated at the date of grant by using Monte Carlo Simulations (for market-based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk-free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 2.87%; the expected volatility used in calculating the value of performance awards was 68.26% and the
expected dividend was assumed to be nil.

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Substantial shareholders’ interests and short positions in the shares and underlying
shares of the company
So far as is known to the Directors and the CEO of the Company, as at 31 December 2023, the following persons
had interests or short positions in the shares or underlying shares of the Company that were required to be
disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or that were recorded
in the register required to be kept by the Company under Section 336 of the SFO:

Long position in the shares of the company as at 31 December 2023

Approximate
percentage of total
Number of number of issued
Name of substantial Shareholders Capacity shares held1 shares (%)2
Interest of controlled
China Minmetals Corporation (CMC) corporations 5,847,166,374 67.55
Interest of controlled
China Minmetals Corporation Limited (CMCL) corporations 5,847,166,374 67.55
Interest of controlled
China Minmetals Non-ferrous Metals Holding Co., Ltd (CMNH) corporations 5,847,166,374 67.55
Interest of controlled
China Minmetals Non-ferrous Metals Co., Ltd (CMN) corporations 5,847,166,374 67.55
Interest of controlled
Album Enterprises Limited (Album Enterprises) corporations 5,847,166,374 67.55

China Minmetals H.K. (Holdings) Limited (Minmetals HK) Beneficial owner 5,847,166,374 67.55

Notes:
1 Minmetals HK is owned as to approximately 39.04%, 38.95% and 22.01% by CMCL, Album Enterprises and Top Create respectively. Album Enterprises
and Top Create are wholly owned by CMN that, in turn, is owned as to approximately 99.999% and 0.001% by CMNH and CMCL respectively. CMNH
is a wholly owned subsidiary of CMCL. CMCL is owned as to approximately 87.5% by CMC and approximately 0.8% by China National Metal Products
Co. Ltd. that, in turn, is a wholly owned subsidiary of CMC. Accordingly, each of CMC, CMCL, CMNH, CMN and Album Enterprises was deemed as
interested in the 5,847,166,374 shares of the Company held by Minmetals HK.
2 The calculation is based on the number of shares that each person is interested in (whether directly/indirectly interested or deemed to be interested)
as a percentage of the total number of issued shares (that is, 8,656,047,188 shares) of the Company as at 31 December 2023.

Save as disclosed above, as at 31 December 2023, there was no other person who was recorded in the register
of the Company, as having an interest or short positions in the shares or underlying shares of the Company who
was required to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or
who was recorded in the register required to be kept by the Company under Section 336 of the SFO.

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Connected transactions
During the year ended 31 December 2023 the Group had the following material connected transactions, details
of which are set out below:

1. On 20 March 2023, the Company announced that MMG Kinsevere had entered into agreements with the
23rd Metallurgical Construction Group Co., Ltd. (MCC23) for the purchase of materials for the construction of
new administrative facilities and the relocation of existing facilities at the Kinsevere Expansion Project dated
22 April 2022 (Material Purchase Agreements). In April 2022, MMG Kinsevere awarded contracts for the
construction, and procurement of materials required for the construction, of a new administration facility and
the relocation of existing facilities for use by the Kinsevere Expansion Project team at the Kinsevere Mine to
a third party. That party then appointed a connected person of the Company, MCC23, as its subcontractor
for the procurement of materials. MCC23 was authorised to execute the Materials Purchase Agreements on
behalf of the third party, and therefore entered into the Materials Purchase Agreements directly with MMG
Kinsevere. At the time of the execution of the Materials Purchase Agreements, the Company incorrectly
classified this transaction as not being subject to compliance with Chapter 14A of the Listing Rules. The
Material Purchase Agreements were valued at a total sum of US$3.2 million and approximately US$535.0 was
paid to MCC23 during 2023.

MCC23 is a subsidiary of CMC, the controlling Shareholder of the Company, it is an associate of CMC and a
connected person of the Company under Chapter 14A of the Listing Rules. As a result, the Materials Purchase
Agreements constitute connected transactions for the Company and should have been disclosed at the time
they were executed.

2. On 4 April 2023, the Company announced that MMG Kinsevere had entered into an agreement with MCC
International Incorporation Ltd. (MCCI) for the procurement of materials required for the construction of the
concentrator plant that forms part of the processing facility for the KEP, valued at a lump-sum payment of
approximately US$17.0 million. During 2023, approximately US$5.9 million was paid to MCCI pursuant to the
terms of the agreement.

On the same date, MMG Kinsevere had entered into an agreement with Metkins for the procurement of
materials in the DRC to enable the construction of the concentrator plant at Kinsevere as part of the KEP
project including sand, pebble and concrete, and local co-ordination works for all materials. The procurement
agreement was value at a total sum of US$9.0 million and approximately US$4.6 million was paid to Metkins
during 2023.

MCCI is a wholly owned subsidiary of MCC Ltd. MCC Ltd.’s parent company, China Metallurgical Group
Corporation (MCC Group), is a wholly owned subsidiary of CMC, the controlling Shareholder of the Company,
and MCCI is therefore an associate of CMC and a connected person of the Company under the Listing Rules.
MCCI has a 49% ownership interest in Metkins. As a more than 30%-controlled company of CMC, Metkins is
therefore an associate of CMC and a connected person of the Company under the Listing Rules. As a result,
the Materials Purchase Agreements both constitute connected transactions for the Company.

3. On 19 September 2023, the Company announced that MMG Kinsevere had entered into a goods and services
agreement with Beijing Dadi Trading Company Limited (Beijing Dadi) for the supply of Machine Maintenance
Devices for the KEP, valued at a lump-sum payment of approximately US$162,322. During 2023, no money
was paid to Beijing Dadi pursuant to the terms of the agreement.

When the goods and services agreement was executed, some of the relevant percentage ratios in
respect of the agreement were more than 0.1% but less than 5%, when aggregated with other connected
transactions with connected persons providing services to the KEP in the previous 12-month period.
Those agreements were for the supply of piping materials of the cobalt plant with Beijing Dadi (valued at

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approximately US$47,700), and agreement with Beijing Dadi for supply of materials for leaching tank (valued
at approximately US$31,500), supply of SAG mill ball charger (valued at approximately US$36,000), supply
of bolts and buts for leaching tank (valued at approximately US$10,800), supply of cables for tailing transfer
system (valued at approximately US$20,094), supply of three flanges (valued at approximately US$699),
supply of sampling device (valued at approximately US$2.31 million), supply of bag breaker (valued at
approximately US$48,500), supply of hose pumps (valued at approximately US$345,800) and supply of
supplemented gap spare parts (valued at approximately US$47,000).

Beijing Dadi is a wholly owned subsidiary of MCCT, which is a wholly owned subsidiary of MCC Ltd.
The MCC Group has an interest of 49.18% in MCC Ltd. The MCC Group is a wholly owned subsidiary of CMC.
As a result, the Goods and Services Agreement constitutes a connected transaction for the Company.

4. On 18 December 2023, the Company announced that MMG Kinsevere had entered into a goods and services
agreement with China ENFI Engineering Corporation (ENFI Corporation) in supply of LV Cabinets for the KEP,
valued at a lump-sum payment of approximately US$2.3 million. During 2023, approximately US$1.5 million
was paid to ENFI Corporation pursuant to the terms of the agreement.

When the agreement was executed, some of the relevant percentage ratios in respect of the agreement
were more than 0.1% but less than 5%, when aggregated with other connected transactions with connected
persons providing services to the KEP in the previous 12 month period. Those agreements were for the supply
of fence materials for TSF3 with Minmetals Logistics Group (valued at approximately US$34,941), supply of
instrumentation for concentrator plant with Beijing Dadi (valued at approximately US$384,000) and supply of
technical review on RGA plant with Changsha Research Institute of Mining And Metallurgy Co., Ltd (valued at
approximately US$45,000).

A 90% stake of ENFI Corporation is held by China ENFI Engineering Co., Ltd (ENFI Ltd), ENFI Ltd is a wholly
owned subsidiary of Metallurgical Corporation of China Ltd. (MCC Ltd.). MCC Group holds a 49.18% stake in
MCC Ltd. MCC Group is a wholly owned subsidiary of CMC. Therefore, ENFI Corporation and the Company
are connected persons. As a result, the Goods and Services Agreement constitutes a connected transaction
for the Company.

Continuing connected transactions

During the year ended 31 December 2023, the Group had the following material continuing connected
transactions, details of which are set out below:

1. On 27 June 2014, MMG South America Company Limited (MMG SA) entered into an agreement with CMN
in relation to the sale of copper concentrate to be purchased by MMG SA from the Las Bambas Project
to the CMN Group (Las Bambas CMN Copper Sale Framework Agreement), subject to the approval of the
Independent Shareholders. The Independent Shareholders approved the Las Bambas CMN Copper Sale
Framework Agreement, and the proposed annual caps on sales, at an EGM held on 21 July 2014.

On 11 January 2016, pursuant to the terms of the Las Bambas CMN Copper Sale Framework Agreement, MMG
SA and CMN entered into an agreement to set out the specific terms on which the sale and purchase of the
copper concentrate between CMN and MMG SA will be made (Las Bambas CMN Copper Concentrate Offtake
Agreement).

In accordance with the Las Bambas CMN Copper Sale Framework Agreement, the term of the Las Bambas
CMN Copper Concentrate Offtake Agreement is for the term of the life of the Las Bambas mine. The annual
caps with respect to the Las Bambas CMN Copper Sale Framework Agreement are set as a fixed quantity of
copper contained in copper concentrate from the Las Bambas Project to be sold by MMG SA to members of
the CMN Group in a year, which for the year commencing 1 January 2023 was set at 277,000 tonnes. During
the year ended 31 December 2023, approximately 207,052 tonnes of copper contained in copper concentrate

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were sold by MMG SA to members of the CMN Group under the Las Bambas CMN Copper Concentrate
Offtake Agreement.

CMN is a controlling Shareholder of the Company and is therefore a connected person of the Company under
the Listing Rules. Accordingly, the Las Bambas CMN Copper Sale Framework Agreement and Las Bambas
CMN Copper Concentrate Offtake Agreement constitute continuing connected transactions for the Company
under Chapter 14A of the Listing Rules.

2. On 11 January 2016, pursuant to the Shareholders’ Agreement, MLB and CITIC Metal Peru Investment Limited
(CITIC) entered into an agreement for the sale and purchase of CITIC’s entitlement to copper concentrate
from the Las Bambas mine (CITIC Copper Concentrate Offtake Agreement). The term of the CITIC Copper
Concentrate Offtake Agreement is for the term of the life of the Las Bambas mine. The annual caps with
respect to the CITIC Copper Sale Framework Agreement are set as a fixed quantity of copper contained
in copper concentrate from the Las Bambas Project to be sold by MLB to CITIC in a year, which for the
year commencing 1 January 2023 was set at 127,000 tonnes. During the year ended 31 December 2023,
approximately 100,840 tonnes of copper contained in copper concentrate were sold by MLB to CITIC under
the CITIC Copper Concentrate Offtake Agreement.

As CITIC controls more than 10% of the total number of issued shares of MMG SAM, it is a substantial
shareholder of MMG SAM. CITIC is therefore a connected person of the Company and the transactions
contemplated under the CITIC Copper Concentrate Offtake Agreement constitute continuing connected
transactions of the Company under Chapter 14A of the Listing Rules.

3. On 9 December 2021, MMG Australia Limited (MMG Australia) entered into an agreement with Minmetals
North-Europe Aktiebolag AB (Minmetals North-Europe) in relation to the sale of concentrate for the period
from 1 January 2022 to 31 December 2023 (Rosebery Concentrate Sales Agreement). The annual cap for
sales for each year of this agreement is US$100.0 million. During the year ended 31 December 2023, sales of
US$65,179,451.0 were transacted under the Rosebery Concentrate Sales Agreement.

On 21 December 2023, the Company announced that MMG Australia entered into an agreement with
Minmetals North-Europe in relation to the sale of concentrate for the period from 1 January 2024 to 31
December 2025 (Rosebery Concentrate Sales Agreement). The annual cap for sales for each year of this
agreement is US$100.0 million. During the year ended 31 December 2023, no sales were transacted under the
Rosebery Concentrate Sales Agreement.

Minmetals North-Europe is a wholly owned subsidiary of CMC, the ultimate controlling Shareholder of the
Company, and is therefore an associate of CMC and a connected person of the Company under the Listing
Rules. Accordingly, the agreements with MMG Australia constitute continuing connected transactions for the
Company under Chapter 14A of the Listing Rules.

4. On 16 December 2021, MMG Dugald River entered into an agreement with Minmetals North-Europe in relation
to the sale of zinc concentrate for the period from 1 January 2022 to 31 December 2024 (Dugald River Zinc
Concentrate Sales Agreement). The annual cap for sales for each year of this agreement was increased in
April 2022 from US$145.0 million to US$205.0 million. During the year ended 31 December 2023, sales of
approximately US$110.0 million was transacted under the Dugald River Zinc Concentrate Sales Agreement.

Minmetals North-Europe is a wholly owned subsidiary of CMC, the ultimate controlling Shareholder of the
Company, and is therefore an associate of CMC and a connected person of the Company under the Listing
Rules. As a result, the agreement with MMG Dugald River constitutes a continuing connected transaction for
the Company under Chapter 14A of the Listing Rules.

5. On 15 March 2023, the Company announced that it had entered into a shipping framework agreement with
Minmetals Logistics in relation to the provision of ocean transport by Minmetals Logistics for the shipment

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of the products of the Group during 2023 and 2024 with annual caps of US$10.0 million. During the year
ended 31 December 2023, approximately US$4.2 million was paid to Minmetals Logistics under the Shipping
Framework Agreement.

Minmetals Logistics is a wholly owned subsidiary of CMC, the ultimate controlling Shareholder of the
Company, and is therefore an associate of CMC and a connected person of the Company under the Listing
Rules. As a result, the shipping framework agreements constitute continuing connected transactions for the
Company under Chapter 14A of the Listing Rules.

6. On 24 March 2023, the Company announced that MLB had entered into a molybdenum concentrate sales
framework agreement with CMN for sales of molybdenum concentrate during 2023, 2024 and 2025 to CMN
and its associates with an annual cap of US$110.0 million (Las Bambas Molybdenum Concentrate Sales
Framework Agreements). During the year ended 31 December 2023, sales of approximately US$44.3 million
was transacted under the molybdenum concentrate sales framework agreement.

CMN is the controlling Shareholder of the Company and is therefore a connected person of the Company
under the Listing Rules. As a result, the Las Bambas Molybdenum Concentrate Sales Framework Agreements
each constitute a continuing connected transaction for the Company under Chapter 14A of the Listing Rules.

7. Upon the completion of the acquisition of Minerals and Metals Group on 31 December 2010, the following
material continuing transaction became a continuing connected transaction under Chapter 14A of the Listing
Rules (Grandfathered Continuing Connected Transaction).

On 10 June 2010, MMG Management Pty Ltd, a wholly owned subsidiary of the Company, entered into a
loan facility agreement with Album Enterprises (Grandfathered MMG Loan Facility) pursuant to which MMG
Management Pty Ltd agreed to make loan facilities available to Album Enterprises on an uncommitted
basis. During the year ended 31 December 2023, no amounts were advanced or outstanding under the
Grandfathered MMG Loan Facility. Album Enterprises is a substantial Shareholder and is therefore a
connected person of the Company under the Listing Rules. Accordingly, the Grandfathered MMG Loan
Facility constitutes a Grandfathered Continuing Connected Transaction for the Company and the Company
will comply with Listing Rule 14A.60 in respect of this transaction.

The Company has followed its pricing policies and guidelines when determining the price and terms of the
connected transactions and continuing connected transactions conducted during the year.

Review of continuing connected transactions

The continuing connected transactions described above for the year ended 31 December 2023 have been
reviewed by the Independent Non-executive Directors of the Company.

The Independent Non-executive Directors of the Company have confirmed that the continuing connected
transactions have been entered into:

(a) the ordinary and usual course of business of the Group;

(b) either on normal commercial terms or better; and

(c) in accordance with the respective terms of the Las Bambas CMN Copper Sale Framework Agreement, the Las
Bambas CMN Copper Concentrate Offtake Agreement, the CITIC Copper Concentrate Offtake Agreement,
the Rosebery Concentrate Sales Agreement, the Dugald River Zinc Concentrate Sales Agreement,
the Shipping Framework Agreement and the Las Bambas Molybdenum Concentrate Sales Framework
Agreements that are fair and reasonable, in the interests of the Shareholders as a whole.

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The Company’s auditor was engaged to report on the Group’s continuing connected transactions in accordance
with the Hong Kong Standard on Assurance Engagements 3000 (Revised) ‘Assurance Engagements Other Than
Audits or Reviews of Historical Financial Information’ and with reference to Practice Note 740 ‘Auditor’s Letter
on Continuing Connected Transactions under the Hong Kong Listing Rules’ issued by the Hong Kong Institute of
Certified Public Accountants. The auditor has issued their unqualified letter containing its conclusion in respect
of the continuing connected transactions for the year ended 31 December 2023 disclosed above in accordance
with Rule 14A.56 of the Listing Rules. A copy of the auditor’s letter has been provided by the Company to the
Hong Kong Stock Exchange.

In addition, the auditor of the Company has confirmed to the Board that nothing has come to their attention that
causes them to believe that the above continuing connected transactions for the year ended 31 December 2023:

(a) have not been approved by the Board;

(b) w
 ere not, in all material respects, in accordance with the pricing policies of the Group where the transactions
involve the provision of goods or services by the Group;

(c) were not entered into, in all material respects, in accordance with the relevant agreements governing such
transactions; and

the Las Bambas CMN Copper Sale Framework Agreement, the Las Bambas CMN Copper Concentrate Offtake
Agreement, the CITIC Copper Concentrate Offtake Agreement, the Rosebery Concentrate Sales Agreement,
the Dugald River Zinc Concentrate Sales Agreement, the Shipping Framework Agreement and the Las Bambas
Molybdenum Concentrate Sales Framework Agreements have exceeded the respective annual caps or revised
annual cap as disclosed in the announcements of the Company.

Controlling shareholders’ interests in contracts

On 22 July 2014 Top Create, a subsidiary of CMN, a controlling Shareholder, extended a loan facility for a
principal sum of up to US$2,262.0 million to MMG SA for a term of four years for the purpose of acquiring the
Las Bambas Project. On 29 December 2017, 22 December 2020, 27 December 2022 and 25 July 2023 the loan
facility was amended by the parties for the purpose of (among other things) extending the term of the loan,
deferring payment dates and adjusting interest rates. Such loan facility was exempt from the announcement
and reporting requirements of the Listing Rules with respect to connected transactions on the basis that it was
unsecured and on normal commercial terms.

Particulars of other contracts of significance that exist between the Company (or one of its subsidiary
companies) and a controlling Shareholder (or any of its subsidiaries) are set out under Connected Transactions
on pages 76 to 80 of this Annual Report.

Related party transactions

Details of the related party transactions undertaken in the normal course of business are set out in Note 30 to
the Consolidated Financial Statements.

Related party transactions set out in Note 30 to the Consolidated Financial Statements also constitute
connected transactions and continuing connected transactions of the Company under the Listing Rules.
The Company has complied with the disclosure requirements in accordance with Chapter 14A of the Listing
Rules except for those transactions that are exempt from the disclosure requirements in Chapter 14A of the
Listing Rules.

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Management contracts
No contracts concerning the management and administration of the whole or any substantial part of the
business of the Company were entered into or existed during the year.

Purchase, sale or redemption of the company’s listed securities

During the year ended 31 December 2023, neither the Company nor any of its subsidiaries purchased, sold or
redeemed any of the Company’s listed securities.

Emolument policy
The Group’s Emolument Policy is formulated by the Governance, Remuneration, Nomination and Sustainability
Committee on the basis of employees’ merit, market practice, qualifications and competence.

The determination of remuneration for the Directors takes into consideration factors such as remuneration paid
by comparable companies, accountabilities of the Directors, applicable regional employment conditions. In the
circumstance of Executive Directors, appropriate ’at-risk’ performance-based remuneration is also provided.

The Company has adopted share option scheme and performance awards as incentives to the Executive
Directors and eligible employees. Details of the share option scheme and performance awards are set out under
the sections headed ‘Share Option Scheme’ and ‘Performance Awards’. In relation to MMG, it has adopted both
long-term and short-term ’at-risk’ incentive plans to reward its Executive Directors and eligible employees and to
align their incentive remuneration with the performance of MMG.

Retirement schemes
Details of the Group’s retirement schemes are set out in Note 11 to the Consolidated Financial Statements.

Directors and senior management

Particulars of the Directors and senior management of the Company are set out on pages 58 to 62 of this Annual
Report.

Independent auditor
The Consolidated Financial Statements have been audited by Deloitte Touche Tohmatsu who will retire at the
forthcoming AGM and, being eligible, offer themselves for re-appointment.

Corporate Governance Report

Details of the Corporate Governance Report are set out on pages 83 to 96 of this Annual Report.

Sufficiency of public float

Based on information that is publicly available to the Company and within the knowledge of its Board, as at the
latest practicable date prior to the printing of this report, the Company has maintained sufficient public float of
not less than 25% of the Company’s issued shares as required under the Listing Rules.

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Events after the balance sheet date

• On 20 November 2023, the Group entered into a Share Purchase Agreement with Cupric Canyon Capital L.P.,
The Ferreira Family Trust, Resource Capital Fund VII L.P., and the Missouri Local Government Employees’
Retirement System (“Sellers”). The Group has conditionally agreed to purchase the entire issued share capital
of Cuprous Capital Ltd (“CCL”) from the Sellers at a purchase price of US$1,875 million.

As at the date of this report, the acquisition had been approved by the Minister of Minerals and Energy
of Botswana; the Competition and Consumer Authority of Botswana; the State Administration for Market
Regulation of the People’s Republic of China (“PRC”) and the requisite majority of the relevant Shareholders
as required under the Listing Rules.

• The group obtained new RCFs of US$300.0 million from CCB of which US$150.0 million is undrawn.

Other than the matter above, there have been no matters that have occurred subsequent to the reporting date,
which have significantly affected, or may significantly affect, the Group’s operations, results or state of affairs in
future years.

By order of the Board

XU Jiqing
Chairman

5 March 2024

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The Company is committed to maintaining a high standard of corporate governance practices by emphasising a
quality Board, sound internal controls, and transparency and accountability to all Shareholders.

Corporate Governance
The Company has complied with all the code provisions set out in the Corporate Governance Code (CG Code)
throughout the year ended 31 December 2023, except for the deviations from code provisions C.2.7 and F.1.1 as
explained under the section headed “Chairman of the Board and Chief Executive Officer” and “Dividend Policy”
respectively and also code provision F.2.2 of the CG Code as explained below.

Code provision F.2.2 of the CG Code requires the Chairman of the Board to attend and answer questions at the
Annual General Meeting (AGM). Mr Jiao Jian, the former Chairman of the Board, resigned as the Chairman of the
Board on 31 March 2023. As such, Mr Leung Cheuk Yan, an Independent Non-executive Director, a member of
the Audit and Risk Management Committee and the Governance, Remuneration, Nomination and Sustainability
Committee of the Company, was nominated by the Board to take the chair of the AGM on 25 May 2023.

The Company adopted a Board Charter to outline the manner in which its constitutional powers and
responsibilities will be exercised, delegated and discharged, having regard to principles of good corporate
governance, international best practices and applicable laws. The Board Charter is adopted on the basis that
strong corporate governance can add to the performance of the Company, create Shareholder value and
engender the confidence of the investment market.

Directors’ securities transactions

The Company has adopted a model code for securities transactions by Directors (Securities Trading Model
Code) on terms no less exacting than the required standard of the Model Code for Securities Transactions by
Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules (Model Code).

A specific enquiry was made of all the Directors and they all confirmed that they have complied with the
requirements set out in the Model Code and the Securities Trading Model Code during the year ended 31
December 2023.

Board
Composition

The Board currently comprises six Directors of which one is an Executive Director, two are Non-executive
Directors and three are Independent Non-executive Directors.

The members of the Board as at the date of this report are as follows:

Executive Director

Mr LI Liangang (Interim CEO)

Non-executive Directors

Mr XU Jiqing (Chairman)
(Appointed as the Chairman on 18 August 2023)

Mr ZHANG Shuqiang

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Independent Non-executive Directors

Dr Peter CASSIDY

Mr LEUNG Cheuk Yan

Mr CHAN Ka Keung, Peter

The current Board possesses an appropriate balance of skills, experience and diversity of perspectives relevant
to the management of the Company’s business. The Directors’ biographical information is set out on pages 58 to
62 under the section headed ‘Directors and Senior Management’ of this Annual Report.

Role and function

The Board formulates overall strategies and policies of the Group. It also ensures the availability of adequate
capital and managerial resources to implement the strategies adopted, the adequacy of systems of financial
and internal control and the conduct of business in conformity with applicable laws and regulations. The Board
members are fully committed to their roles and have acted in the best interests of the Group and its Shareholders
at all times. There is no financial, business, family or other material/ relevant relationship among the Directors.

All Directors are required to comply with Rule 3.08(d) of the Listing Rules to avoid actual and potential conflicts
of interest and duty at all times. Directors are required to declare their interest in the matters to be considered at
each Board meeting and Board committee meeting. If a Director or any of his/her associates has material interest
in the matter to be considered, the Director will not be allowed to vote at the meeting. The Director may also be
required to withdraw from the meeting during discussion of the matter.

During the year ended 31 December 2023, other than resolutions passed in writing by all the Directors, the
Company held nine Board meetings. The AGM was held on 25 May 2023. Board meetings are attended by a
majority of the Directors in person or through electronic means of communication.

The attendance of each Director at the Board meetings and the AGM during the year ended 31 December 2023
is set out below. Figures in brackets indicate the maximum number of meetings held in the period in which the
individual was a Board member.

Number of meeting attended

Directors Board meetings AGM
Executive Director
LI Liangang 9/(9) 1/(1)
Non-executive Directors
JIAO Jian (Former Chairman)1 0/(1) N/A
XU Jiqing (Chairman)2 9/(9) 1/(1)
ZHANG Shuqiang 9/(9) 1/(1)
Independent Non-executive Directors
Peter CASSIDY 9/(9) 1/(1)
LEUNG Cheuk Yan 9/(9) 1/(1)
CHAN Ka Keung, Peter 9/(9) 1/(1)

Notes:
1 Mr Jiao Jian resigned as a Non-executive Director and the Chairman of the Company with effect from 31 March 2023.
2 Mr Xu Jiqing was appointed as the Chairman of the Company on 18 August 2023.

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Board and workforce diversity

The Company has developed the Board Diversity Statement recognising and embracing the benefits of having
a diverse Board to enhance the quality of its performance. With a view to achieving sustainable and balanced
development, the Company sees increasing diversity at the Board level as an essential element in supporting the
attainment of its strategic objectives and its sustainable development.

In designing the Board’s composition, the Company has considered Board diversity from a number of aspects,
including but not limited to gender, age, cultural and educational background, ethnicity, professional experience,
skills, knowledge and length of service. The Governance, Remuneration, Nomination and Sustainability
Committee has endorsed a strategy for appointing a female director by December 2024 and in line with this
strategy management are preparing a pipeline of potential applicants. The Board will appoint a new director
in accordance with the Board Diversity Statement, Board Succession Guidelines and Board Skills Matrix of
the Group.

All Board appointments will be based on merit, and candidates will be considered against objective criteria,
having due regard to the benefits of diversity on the Board. The ultimate decision will be based on the
contribution that the selected candidate will bring to the Board.

The Board comprises members from a diverse background. The Company has at all times during the year had
one Independent Non-executive Director who is a qualified accountant. One of the Independent Non-executive
Directors is a qualified solicitor. Five Directors have experience sitting on the boards of other companies listed
on the stock exchanges of Hong Kong, the PRC and/or Australia. Collectively the Directors have extensive
experience in the metals and mining industry, trading, finance and accounting, business strategy, law, enterprise
risk management and exposure or experience in various countries. Some of them are members of professional
and/or industry bodies.

MMG strives to provide an inclusive workplace and to nurture and support the employees to reach their fullest
potential. The Company believes that this is a key driver for innovation and adaptability which will increase
competitiveness and drive the Group forward. As at 31 December 2023, women represent 14.9% of our employee
population and 5.3% of our senior management across the Group.

Empowering women with more leadership roles has been a key focus of the Group. We have taken measures to
ensure team compositions are diverse with a balanced number of women and men. By the year end of 2023, the
Company strives to increase the employment levels of women across all operation areas to 15.1%.

Chairman of the Board and Chief Executive Officer

The Chairman of the Board is Mr Xu Jiqing who was appointed on 18 August 2023; Mr Jiao Jian resigned as the
Chairman of the Board with effect from 31 March 2023; and Mr Li Liangang is currently the Interim CEO of the
Company. The roles of the Chairman of the Board and the CEO/Interim CEO of the Company are segregated to
ensure their respective independence, accountability and responsibility.

The Chairman takes the lead in formulating the Group’s overall strategies and policies, ensures the Board’s
effective performance of its functions, including compliance with good corporate governance practices, and
encourages and facilitates active contribution of Directors in Board activities. Directors with different views are
encouraged to voice their concerns. They are allowed sufficient time for discussion of issues so as to ensure
that Board decisions fairly reflect Board consensus. A culture of openness and debate is promoted to facilitate
the effective contribution of Non‑executive Directors and Independent Non-executive Directors and to ensure
constructive relations between Executive Directors, Non-executive Directors and Independent Non-executive
Directors. During the year, the Chairman did not hold a separate meeting with the Independent Non-executive
Directors. The Chairman is available to hold meetings with any director including the Non-executive Directors
and Independent Non-executive Directors if required or necessary outside of the Board meetings but the

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Chairman met with all Directors including the Non-executive Directors and the Independent Non-executive
Directors at each Board meeting, except the Board meetings held during the period from 31 March 2023 to
17 August 2023.

The Chairman also ensures that all Directors are properly briefed on issues arising at Board meetings and have
received, in a timely manner, adequate information, which must be accurate, clear, complete and reliable.

The CEO/Interim CEO, supported by a management committee comprising himself and senior management
(Executive Committee), is responsible for managing the day-to-day operations of the Group and executing the
strategies adopted by the Board. The CEO/Interim CEO is also accountable to the Board for the implementation
of the Group’s overall strategies, and coordination of overall business operations.

Executive directors and executive committee

The Board has delegated the management of the Group’s day-to-day operations to the CEO/Interim CEO
and the Executive Committee. The Executive Committee is also required to report regularly to the Board on
the progress being made by the Group’s businesses.
The members of the Executive Committee as at the date of this report are as follows:
• Mr LI Liangang (Interim CEO, Executive Director and Executive General Manager – Commercial and
Development) (was appointed as the Executive General Manager – Commercial and Development with
effect from 1 February 2024);
• Mr Ross CARROLL (CFO) (retired with effect from 6 March 2024);
• Mr Song QIAN (Executive General Manager – Finance) (was appointed as a member of Executive Committee
with effect from 1 February 2024)
• Mr Troy HEY (Executive General Manager – Corporate Relations);
• Mr WEI Jianxian (Executive General Manager – Americas); and
• Mr Nan WANG (Executive General Manager – Operations) (was appointed with effect from 1 February 2024).

On 22 January 2024, the Company announced that Mr Ross CARROLL had notified the Company of his
retirement from the role of CFO with effect from 6 March 2024 and that he will depart MMG on 1 July 2024 in
order to assist with the transition.

With effect from 1 February 2024, the Company also announced the following changes in the functions and
position of the Executive General Manager:

1. Appointment of Mr Song QIAN as the Executive General Manager – Finance;

2. A new position of Executive General Manager - Operations had been created to integrate group operational
accountability with operational excellence. Mr Nan WANG, who was the Executive General Manager -
Australia and Africa with responsibilities for the Dugald River, Rosebery and Kinsevere operations, was re-
designated to this new role;
3. Mr WEI Jianxian continues as the Executive General Manager – Americas. The General Manager Operations
Las Bambas will continue to report to Mr Wei, with a secondary reporting line to the Executive General
Manager – Operations;

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4. Mr Troy HEY, the current Executive General Manager – Corporate Relations, took accountability for the Legal
and Company Secretarial functions alongside his existing accountabilities and the General Counsel will report
to Mr Hey. The People function reports directly to the Interim CEO and retains a secondary reporting line to
Executive General Manager - Corporate Relations. The Assurance, Risk and Internal Audit function reports
directly to the Interim CEO; and
5. The Interim CEO of the Company, Mr LI Liangang, also performs as the Executive General Manager -
Commercial and Development until the current recruitment process is completed. The new position was
created to focus on strategy, projects, mergers and acquisitions. This position is alongside the existing
marketing and supply portfolio.

Non-executive directors

The Non-executive Directors (including the Independent Non-executive Directors) provide a wide range
of expertise and experience and bring independent judgement on issues relating to the Group’s strategies,
development, performance and risk management through their contribution at Board and committee meetings.

Independent non-executive directors

The Independent Non-executive Directors serve the important function of ensuring and monitoring the basis
for an effective corporate governance framework. Their participation provides adequate checks and balances
to safeguard the interests of Shareholders. The Board has three Independent Non-executive Directors and
one of them has accounting or related financial management expertise. The Board confirms that the Company
has received from each of the Independent Non-executive Directors a confirmation of independence for the
year ended 31 December 2023 pursuant to Rule 3.13 of the Listing Rules and considers such Directors to be
independent.

Re-election of directors

Each of the Non-executive Directors entered into an appointment agreement with the Company for a
specific term of three years, except for Dr Peter Cassidy. Dr Cassidy’s appointment agreement commenced
on 31 December 2010 and continues until either the Company or he terminates such agreement by serving
on the other not less than one month’s prior written notice.

In accordance with the Company’s articles of association, each Director appointed by the Board shall be subject
to re-election by Shareholders at the next general meeting (in the case of filling a casual vacancy) or at the next
AGM (in the case of an addition to the Board), and thereafter be subject to retirement by rotation at least once
every three years at the AGM. Dr Cassidy, who was appointed by the Board on 31 December 2010 to fill a casual
vacancy, is also subject to retirement from the Board by rotation at least once every three years at the AGM.
Since Dr Cassidy has been appointed, he has been re-elected by Shareholders at the AGMs held in 2011, 2013,
2016, 2019 and 2022.

Directors’ training and continuous professional development

Every newly appointed Director receives a briefing and orientation on his legal and other responsibilities as
a listed company director and the role of the Board. He also receives a comprehensive induction package
covering the statutory and regulatory obligations of a director, organisational structure, policies, procedures
and codes of the Company, terms of reference of Board committees and charter of responsibilities. All Directors
are encouraged to participate in continuous professional development and refresh their knowledge and skills.
All Directors have been updated on the latest developments regarding the Listing Rules and other applicable
regulatory requirements to ensure compliance and enhance their awareness of good corporate governance
practices.

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All Directors have participated in continuous professional development by attending seminars and/ or
conferences and/or forums and/or in-house trainings to develop and refresh their knowledge and skills.
In addition, attendance at briefing sessions (including the delivery of speeches) and the provision of reading
materials on the relevant topics contributed toward continuous professional training. All Directors provided
a record of training to the Company. A summary of training attended by the Directors for the year ended
31 December 2023 is set out below:

Directors Types of training (notes)

Executive Director
LI Liangang 1, 2, 3
Non-executive Directors
JIAO Jian (Resigned on 31 March 2023) 3
ZHANG Shuqiang 1, 2
XU Jiqing 1, 2, 3
Independent Non-executive Directors
Peter CASSIDY 1, 3
LEUNG Cheuk Yan 1, 3
CHAN Ka Keung, Peter 1, 3

Notes:
1 Attending seminars and/or conferences and/or forums and/or in-house trainings.
2 Delivering speeches/presentations at seminars and/or conferences and/ or forums.
3 Reading journals, documentaries, books, newspapers relating to the director’s duties and responsibilities.

Directors’ and officers’ liabilities insurance

The Company has arranged appropriate directors’ and officers’ liabilities insurance in respect of legal action
against the Directors and officers of the Company.

The Board committees

There are two Board committees, namely the Audit and Risk Management Committee and the Governance,
Remuneration, Nomination and Sustainability Committee, for overseeing particular aspects of the Company’s
affairs.

Audit and risk management committee

The Audit and Risk Management Committee comprises five members including three Independent Non-executive
Directors, namely Mr Chan Ka Keung, Peter as Chair, Dr Peter Cassidy and Mr Leung Cheuk Yan, and two Non-
executive Directors, namely Mr Zhang Shuqiang and Mr Xu Jiqing.

The Audit and Risk Management Committee is principally responsible for (i) financial reporting related matters,
such as reviewing financial information and overseeing financial reporting related systems and controls; and (ii)
advising the Board on high-level risk related matters, risk management and internal control, including advising
on risk assessment and oversight of the internal audit function. The terms of reference of the Audit and Risk
Management Committee are available on the websites of the Hong Kong Stock Exchange and the Company.

During the year ended 31 December 2023, the Audit and Risk Management Committee held five meetings. The
Committee reviewed financial reporting matters, the Company’s Financial Statements, annual and interim reports,
the connected transactions and the continuing connected transactions entered into by the Group and the
audit fees for the year ended 31 December 2023. It also reviewed the external audit scope and plans and audit

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findings, material risk profile and prioritised material risk analysis including internal audit plans and audit findings,
treasury, tax matters, compliance against the Risk Management Framework, and the Insurance Program including
the renewals of the annual insurance and the directors and officers liabilities insurance and the programs for
Audit and Risk Management Committee activities for 2023 and 2024. The Committee discussed with senior
management the independence of the external auditors and the effectiveness of the external and internal audit
process.

The attendance of each member at the Audit and Risk Management Committee meetings for the year ended
31 December 2023 is set out below. Figures in brackets indicate the maximum number of meetings held in the
period in which the individual was a member of the Audit and Risk Management Committee.

Members Number of meetings attended

Non-executive Directors
ZHANG Shuqiang 5/(5)
XU Jiqing 4/(5)
Independent Non-executive Directors
Peter CASSIDY 5/(5)
LEUNG Cheuk Yan 5/(5)
CHAN Ka Keung, Peter (Chairman) 5/(5)

Governance, Remuneration, Nomination and Sustainability Committee

The Governance, Remuneration, Nomination and Sustainability Committee comprises four members including
three Independent Non-executive Directors, namely Dr Peter Cassidy as Chair, Mr Leung Cheuk Yan and Mr
Chan Ka Keung, Peter, and a Non‑executive Director, namely Mr Xu Jiqing.

The Governance, Remuneration, Nomination and Sustainability Committee is principally responsible for (i)
developing, reviewing and monitoring the Group’s policies and practices on corporate governance to ensure
compliance with the relevant legal and regulatory requirements; (ii) formulating the Company’s remuneration
policy and structure for all Directors and senior management’s remuneration and to make recommendations to
the Board on the above remuneration policy and proposal; (iii) formulating the policy for nomination of Directors
and leading the process of identifying and nominating candidates suitably qualified to become Board members,
and reviewing the structure, size and composition of the Board and Board Committees (including knowledge,
skills and experience, independence and diversity of the members) and makes recommendations to the Board
with regard to any changes; review ESG and sustainability reporting and relevant compliance requirements. The
terms of reference of the Governance, Remuneration, Nomination and Sustainability Committee are available on
the websites of the Hong Kong Stock Exchange and the Company.

During the year ended 31 December 2023, the Governance, Remuneration, Nomination and Sustainability
Committee held six meetings. The Committee reviewed the Mineral Resources and Ore Reserves Statement, the
Whistleblower Reports, the 2023 Disclosure Reports, the performance review and evaluation of the Board and
the Board Committees, the Directors and senior management training program and the Corporate Governance
Report for inclusion in the annual report. It also reviewed the remuneration policy, the incentive and retention
plans, annual remuneration and the programs for Governance, Remuneration, Nomination and Sustainability
Committee activities for 2023 and 2024.

The attendance of each member at the Governance, Remuneration, Nomination and Sustainability Committee
meetings for the year ended 31 December 2023 is set out below. Figures in brackets indicate the maximum
number of meetings held in the period in which the individual was a member of the Governance, Remuneration,
Nomination and Sustainability Committee.

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Members Number of meetings attended

Non-executive Directors
JIAO Jian1 0/(1)
XU Jiqing 6/(6)
Independent Non-executive Directors
Peter CASSIDY (Chairman) 6/(6)
LEUNG Cheuk Yan 6/(6)
CHAN Ka Keung, Peter 6/(6)

Note:
1 Mr Jiao Jian resigned as a Non-executive Director with effect from 31 March 2023. During his tenure in 2023, one meeting of the Governance,
Remuneration, Nomination and Sustainability Committee was held.

The Company’s Mineral Resources and Ore Reserves Committee and Disclosure Committee also report to the
Governance, Remuneration, Nomination and Sustainability Committee.

The Mineral Resources and Ore Reserves Committee is responsible for overseeing the Mineral Resources and
Ore Reserves reporting process and ensuring its compliance with the Listing Rules and JORC Code.

The Disclosure Committee is responsible for advising on disclosure obligations of the Company. The Company
has adopted a Disclosure Framework to ensure its compliance with the disclosure obligations under the Listing
Rules and the timely disclosure of inside information to the market. The Disclosure Committee comprises the
Interim CEO, CFO, Executive General Manager – Corporate Relations, the General Counsel and the Company
Secretary. The Disclosure Framework requires employees to refer all information that potentially requires
disclosure to a member of the Disclosure Committee.

Executive committee

The Executive Committee reviews safety, health and environmental and social performance in order to improve
efficiency and effectiveness. Specific Safety, Health, Environment and Community (SHEC) matters to be
discussed by the Board include identification, review and governance of SHEC-related material issues, significant
incidents, remediation/mitigation strategies and any specific areas of focus as identified by the Board.

Accountability and audit

Financial reporting

The Directors acknowledge their responsibility for preparing all information and representations contained in the
Financial Statements for the year ended 31 December 2023 as disclosed in this Annual Report. The Directors
consider that the Financial Statements have been prepared in conformity with Hong Kong Financial Reporting
Standards (HKFRS) issued by the Hong Kong Institute of Certified Public Accountants and the Companies
Ordinance, and reflect amounts that are based on the best estimates and reasonable, informed and prudent
judgement of the Board and management with an appropriate consideration to materiality. The Directors, having
made appropriate enquiries, were not aware of any material uncertainties relating to events or conditions that
might cast significant doubt upon the Group’s and the Company’s ability to continue as a going concern. Please
refer to Note 2.1 to the Consolidated Financial Statements for further details.

Accordingly, the Directors have prepared the Financial Statements on a going-concern basis. The statement of
the Company’s auditor regarding its responsibilities for the Financial Statements is set out in the Independent
Auditor’s Report on pages 110 to 115 of this Annual Report.

Management has provided all members of the Board with monthly updates giving a balanced and

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comprehensible assessment of the Company’s performance, position and prospects in sufficient detail to enable
the Board as a whole and each Director to discharge their duties.

Risk management and internal controls

The Audit and Risk Management Committee assists the Board with regard to the oversight of the Company’s risk
management and internal control systems and practices.

The Risk and Audit function in MMG supports the Audit and Risk Management Committee and line management
by:

• establishing and maintaining Group-wide Standards relating to risk management and assurance;
• undertaking internal audits to test compliance with Group Standards and legal obligations and to assess the
adequacy and effectiveness of critical controls to material risks;
• reporting control weaknesses and non-compliances at MMG’s operations;
• monitoring critical control failings across the industry and assessing implications for MMG;
• monitoring and reporting closeout of management agreed actions to improve control effectiveness and to
correct non-compliances; and
• monitoring the Group’s risk profile and reporting substantive changes in the risk profile.

The Company’s risk management and internal audit processes are subject to periodic, independent external
assessment against relevant International Standards and industry best practices.

The annual internal audit plan is approved by the Audit and Risk Management Committee. Its focus is on material
risks to the business, both financial and non‑financial.

The Audit and Risk Management Committee is responsible for ensuring that there is appropriate coordination
between internal and external audit. It is also responsible for ensuring that internal audit is adequately resourced
and has appropriate standing within the Group. It also reviews and monitors the effectiveness of internal audit.

MMG’s Internal Audit Procedure requires the Risk and Audit function to maintain its independence. It also
requires reporting, to the Chair of the Audit and Risk Management Committee, of any instance where the Group’s
independence may have been compromised.

Auditor’s remuneration

An analysis of the remuneration of the external auditor, Deloitte Touche Tohmatsu (which for these purposes
includes any entity under common control, ownership or management with the external auditor or any entity that
a reasonable and informed third party having knowledge of all relevant information would reasonably conclude as
part of the audit firm nationally or internationally), for the year ended 31 December 2023 is set out as follows:

Fee paid/payable 2023

Services rendered US$’000
Audit services 1,742
Other assurance services 182
Non-audit Services 36
1,960

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Company secretary
Ms Wong Lok Wun, Anfield is the Company Secretary of the Company with over 15 years of experience in
the corporate secretarial field and has been providing professional corporate services to Hong Kong listed
companies and private companies. Ms Wong is a chartered secretary, a chartered governance professional and
an associate member of The Hong Kong Chartered Governance Institute (HKCGI) (formerly known as The Hong
Kong Institute of Chartered Secretaries).

The Company Secretary assists the Board by ensuring good information flow within the Board and that the Board
policy and procedures including those on governance matters are followed. All the Directors are entitled to have
access to the advice and services of the Company Secretary. She reports to the Chairman of the Board and also
the CEO/Interim CEO. Ms Wong has respectively attended various professional seminars during the year ended
31 December 2023, which exceed the requirements of the Listing Rules.

Shareholders’ rights
Procedures for Shareholders to convene a general meeting

Shareholders holding at least 5% of the total voting rights of all Shareholders having a right to vote at the
Company’s general meeting can deposit a written request to convene a general meeting at Unit 1208, 12/F,
China Minmetals Tower, 79 Chatham Road South, Tsimshatsui, Kowloon, Hong Kong, the registered office of the
Company, for the attention of the Company Secretary, or send the written request to the Company by fax at
+852 2840 0580.

The written request: (i) must state the general nature of the business to be dealt with at the meeting, and (ii)
may include the text of a resolution that may properly be moved and is intended to be moved at the meeting and
signed by the Shareholders concerned.

The request will be verified with the Company’s Share Registrar and, upon confirmation that the request is
proper and in order, the Board will convene a general meeting by serving sufficient notice to all the registered
Shareholders.

However, if the request has been verified as not in order, the Shareholders concerned will be advised of this
outcome and, accordingly, a general meeting will not be convened as requested. Pursuant to the articles of
association of the Company and the Companies Ordinance, the notice period to be given to all the registered
Shareholders for consideration of the proposed resolutions at a general meeting is not less than 14 days.

If the Directors do not within 21 days after the date on which they become subject to the requirement to call a
general meeting to be held on a date not more than 28 days after the date of the notice convening the meeting,
the Shareholders concerned or any of them representing more than one half of the total votes of all of them, may
themselves call a general meeting, provided that such general meeting must be called for a date not more than
three months after the date on which the Directors become subject to the requirement to call a meeting.

Any reasonable expenses incurred by the Shareholders concerned by reason of the failure of the Directors duly
to call a general meeting shall be repaid to the Shareholders concerned by the Company.

The procedures for Shareholders to convene a general meeting are available on the Company’s website.

Procedures for Shareholders to put forward proposals at the Annual General Meeting

Shareholders holding at least 2.5% of the total voting rights of all Shareholders having the right to vote at the
AGM, or at least 50 Shareholders who have a right to vote on the resolution at the AGM to which the request
relates, can submit a written request to move a resolution at the AGM.

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The written request must state the resolution and be signed by all the Shareholders concerned. The written
request must be deposited at Unit 1208, 12/F, China Minmetals Tower, 79 Chatham Road South, Tsimshatsui,
Kowloon, Hong Kong, the registered office of the Company, for the attention of the Company Secretary, or sent
to the Company by fax at +852 2840 0580 not later than six weeks before the AGM to which the request relates,
or if later, the time at which notice is given of that meeting.

The request will be verified with the Company’s Share Registrar and, upon confirmation that the request is proper
and in order, the Board will include the resolution in the agenda for the next AGM in accordance with statutory
requirements. However, if the request has been verified as not in order, the Shareholders concerned will be
advised of this outcome and, accordingly, the proposed resolution will not be included in the agenda for the
AGM.

The Company will be responsible for the expenses in serving the notice of the resolution and circulating the
statement submitted by the Shareholders concerned. The procedures for Shareholders to put forward proposals
at the AGM are available on the Company’s website.

Procedures for Shareholders to propose a person for election as a Director

If a Shareholder wishes to propose a person other than a Director for election as a Director at an AGM or a
general meeting, he/she can deposit a written notice to that effect signed by the Shareholder concerned at Unit
1208, 12/F, China Minmetals Tower, 79 Chatham Road South, Tsimshatsui, Kowloon, Hong Kong, the registered
office of the Company, for the attention of the Company Secretary.

The written notice must:

• state the full name of the person proposed for election as a Director;
• state the person’s biographical details as required by Rule 13.51(2) of the Listing Rules; and
• be accompanied by a confirmation signed by the candidate indicating his/her willingness to be appointed.

The period for lodgement of the above notice shall commence no earlier than the day after the despatch of the
notice of the general meeting appointed for such election and end no later than seven days prior to the date of
such meeting, provided that such period shall be at least seven days.

If the written notice is received after the AGM/general meeting notice has been despatched but later than seven
clear calendar days prior to the date of the AGM/ general meeting, the Company may need to consider the
adjournment of the AGM/general meeting in order to allow a sufficient period of notice.

The procedures for Shareholders to propose a person for election as a Director at an AGM/general meeting are
available on the Company’s website.

Procedures for directing Shareholders’ enquiries to the Board

Shareholders may at any time send their enquiries and concerns to the Board in writing through the Company
Secretary to the registered office of the Company at Unit 1208, 12/F, China Minmetals Tower, 79 Chatham Road
South, Tsimshatsui, Kowloon, Hong Kong.

Shareholders may also make enquiries with the Board at the AGM/general meetings of the Company.

Shareholders’ questions in relation to their shareholdings should be directed to the Company’s Share Registrar,
Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East,
Wanchai, Hong Kong.

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Communication with shareholders and investors

The Company recognises the importance of maintaining an ongoing dialogue with the Company’s shareholders
and endeavours to develop and maintain continuing relationships and effective communication with its
Shareholders and investors. In an effort to facilitate and enhance the relationships and communication, the
Company has adopted a Shareholder Communication Policy, which was reviewed by the Board in 2023 to
ensure its effectiveness. The effectiveness of engagement with Shareholders is assessed by the Governance,
Remuneration, Nomination and Sustainability Committee. The Committee endorsed the Shareholder
Communication Policy in 2023, noting that it remained effective and was appropriate for the Company as it
articulated the various communication channels for Shareholders. Such Policy is available on the Company’s
website. The principles of the Shareholder Communication Policy are to ensure effective communication
between the Company and its Shareholders is maintained, and ready, equal and timely access to clear and
balanced information about the Company (including its financial performance, strategic plans, material
developments, governance and risk profile) is available to the Shareholders to enable them to exercise their
rights in an informed manner.

Corporate communications

The Company will generally communicate with Shareholders and the investing public through the following
corporate communication materials:

• financial reports (interim and annual reports), quarterly production reports and sustainability reports;
• announcements, Shareholder circulars and other disclosures through the websites of the Hong Kong
• Stock Exchange and the Company; and
• other corporate communications, presentations, publications and media releases of the Company.

The Company endeavours to use plain, non-technical language in all its communication materials provided to
Shareholders and, where possible, the communication materials are made available in both English and Chinese.

Investor relations

The Company may from time to time conduct investor/ analyst briefings and presentations, road shows, site
visits, or marketing activities for the financial community.

Communications and dialogues with Shareholders, investors, analysts, media or other parties will be conducted
in compliance with the disclosure obligations and requirements under the Disclosure Framework, which aims to
ensure equal, fair and timely dissemination of information.

Corporate website

A dedicated ‘Investors and Media Centre’ section is available on the Company’s website where all corporate
communication materials including materials published on the website of the Hong Kong Exchanges and Clearing
Limited (www.hkexnews.hk) is posted as soon as practicable after their release.

The following information is available on the Company’s website:

• the articles of association of the Company;

• the terms of reference of the Audit and Risk Management Committee and the Governance, Remuneration,
Nomination and Sustainability Committee;
• a summary of the procedures for Shareholders to convene a general meeting, to put forward proposals at the
AGM, and to propose a person for election as a Director;

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• a news archive of stock exchange announcements and media releases; and

• an events calendar setting out important dates and forthcoming events of the Company.

Information on the Company’s website is updated on a regular basis. Shareholders are encouraged to subscribe
to news updates.

Shareholder meetings

Shareholders are encouraged to participate in AGM/ general meetings or appoint proxies to attend and vote at
meetings for and on their behalf if they are unable to attend.

Board members including the Chairman of the Board, and where appropriate, Chairmen and other members of
the relevant Board committees or their delegates, appropriate management executives and representatives from
the Company’s external auditor will attend AGM/general meetings to answer Shareholders’ questions.

In addition, separate resolutions are proposed at the AGM/ general meetings on each substantially separate
issue.

Dividend policy
The Company does not have a dividend policy. The Board will decide on the declaration/ recommendation of any
future dividends after taking into consideration a number of factors, including the prevailing market conditions,
the Company’s operating results, future growth requirements, liquidity position, and other factors that the Board
considers relevant. The recommendation of the payment of any dividend is subject to the discretion of the
Board, and any declaration of dividend will be subject to the approval of Shareholders at the AGM.

Environmental policies and performance

Respect for the environment is a core part of the way MMG operates. The objective of the Company is to
maximise recycling and reuse and to minimise the draw on natural resources, with water being the most
significant natural resource used in our operations. The Company also seeks to minimise energy use and the use
of resources in the generation of electricity.

The environmental management approach is based on the principles of plan, do, check, act and aligns to the
principles of ISO14001. The approach involves identification, assessment and control of material risks across all
phases of our business, from exploration through to development, operation and mine closure. The Company
works in partnership with its Stakeholders to understand the challenges and opportunities of its activities, and
how best to manage them.

The MMG Safety, Security, Health and Environment (SSHE) Performance Standard defines MMG’s minimum
requirements and provides the basis for sustainable environmental management through its deployment at its
operations. These requirements are audited as part of an integrated assurance process.

Through the application of the MMG Operating Model, operations focus on essential environmental delivery
work, supported by functional excellence that drives continual improvement of our management processes.

Key stakeholder relationships

The Company seeks Stakeholder relationships based on trust, transparency and mutual respect for culture,
values and heritage. Understanding the needs, expectations and aspirations of communities impacted by its
operations is vital for the Company to achieve its vision and growth objectives.

The Company’s key relationships are with its employees, communities, suppliers, governments and regulators,
Shareholders, investors, non-government organisations, industry, media and customers.

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Areas of interest vary between each Stakeholder group but cover topics including economic performance, safety
and health management, employee development and well-being, environmental management and compliance
and support for community and regional development.

Stakeholders interact with the Company through a variety of avenues including direct communication and
meetings, receipt of newsletters and corporate publications, disclosures to the Hong Kong Stock Exchange and
membership and representation on industry associations.

MMG has relationships with a range of customers globally for the sale of its products. The sales and marketing
of all products is managed by a Group Sales and Marketing function that negotiates all terms and conditions
at arm’s length arrangements. All prices are referenced to S&P Global Platts or LME or London Bullion Market
Association market prices for the appropriate product sold. Further information is discussed in the Management
Discussion and Analysis on pages 20 to 57 of this Annual Report.

Information on MMG’s approach to environmental, social and governance issues will be reported in the 2023
MMG Sustainability Report available on the Company’s website at (www.mmg.com) in the Second Quarter 2024.

Compliance with laws and regulations

The Company has adopted the Corporate Legal Compliance Standard and other practices to ensure adherence
to applicable legal and regulatory requirements and, in particular, those that have a significant impact on the
operations of the Group. Our Governance, Remuneration, Nomination and Sustainability Committee is delegated
by the Board to review and monitor the Group’s policies and practices on compliance with legal and regulatory
requirements and such policies and practices are regularly reviewed. Any changes in the applicable laws, rules
and regulations are brought to the attention of relevant employees and business units from time to time.

Constitutional documents
There was no change to the Company’s articles of association during the year ended 31 December 2023.

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MMG Limited (the Company) operates and develops copper, zinc, cobalt and other base metals projects across
Australia, the DRC and Peru. In 2023, MMG had four mining operations: Las Bambas, Kinsevere, Dugald River and
Rosebery.

The Company is committed to responsible environmental and social performance and effective governance of its
operations. This supports our growth strategy by helping to:

• manage reputational and regulatory risks;

• control costs and drive efficiencies;
• build strong stakeholder relationships; and
• attract and retain talented employees.

ESG reporting and materiality

The Company conducts a Global Reporting Initiative (GRI)-aligned materiality assessment to ensure that ESG
issues which matter most to our stakeholders are reported.

The MMG Sustainability Report provides an annual summary of our approach and performance across our
material sustainability issues. Elements of our sustainability reports are externally assured in line with our
commitments as a member of the International Council on Mining and Metals (ICMM).

Further information on MMG’s approach to sustainability, health and safety, security, social performance,
environmental performance, key stakeholder relationships and compliance with laws and regulations will be
reported in the 2023 MMG Sustainability Report available on the Company’s website at www.mmg.com in the
Second Quarter of 2024.

Corporate governance
The Company is committed to maintaining a high standard of corporate governance practices demonstrated
through an experienced Board, sound risk management and internal controls, and transparency and
accountability to all stakeholders. For the Company, good governance extends beyond the Board, with executive
management embedding governance practices across the organisation. The company complies with the
principles of good corporate governance as set out in the Corporate Governance Code (CG Code) of the Hong
Kong Listing Rules, those of the ICMM and all external reporting obligations.

The Company has applied the principles of good corporate governance as set out in the Corporate Governance
Code and Corporate Governance Report (CG Code) contained in Appendix C1 of the Hong Kong Listing Rules.
It has complied with all applicable code provisions set out in the Appendix C1 of the Hong Kong Listing Rules
throughout the years, except for the deviation from code provision B.2.2 as explained under the section headed
‘Re-election of Directors’ of the MMG Annual Reports.

MMG has the Audit and Risk Management (ARM) Committee and the Governance, Remuneration, Nomination
and Sustainability (GRNS) Committee both of which operate under clear Terms of Reference. MMG also have a
number of Executive Management Committees, including the Executive Committee, the Disclosure Committee,
Investment Review Committee, Mineral Resources and Ore Reserves Committee and Code of Conduct and
People Committee. A function of the Executive Committee is to review security, safety, health, environmental
and social performance to improve efficiency and effectiveness. Specific security, safety, health, environment
and community (SSHEC) matters to be discussed by the Board include identification, review and governance of
SSHEC-related material issues, significant incidents, remediation/mitigation strategies and any specific areas of
focus as identified by the Board.

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In accordance with the Company’s Sustainability Framework, owned and endorsed by the Board Governance,
Remuneration, Nomination and Sustainability Committee and implemented across the Company, the Board
carries out identification, review and governance of SSHEC-related material issues consistent with this
framework. The framework aligns with the ICMM’s Mining Principles. The Company’s approach is informed by
our Corporate Governance Policy, People Policy, Shareholder Communication Policy, SSHEC Policy and Human
Rights Policy.

There is no universal formula for good corporate governance. Our emphasis throughout this Statement is on
compliance with our internal standards, informed by CG Code of the Hong Kong Listing Rules, those of the ICMM
and all external reporting obligations.

Compliance
The Governance, Remuneration, Nomination and Sustainability Committee is responsible for developing and
reviewing the Company’s policies and practices on corporate governance, the Sustainability material-topics, the
Code of Conduct and monitoring MMG’s compliance with the Listing Rules and other applicable laws.

Our Executive Committee monitors our performance in line with the Group’s policies, standards and regulatory
requirements relating to safety, health, environment and community.

Business ethics
Our values and Code of Conduct inform ongoing, long term stakeholder relationships with communities and
other stakeholders, with formal structures guiding how we review and respond to any potential behavioural,
ethical or cultural issues as they may arise. MMG’s Code of Conduct, which sets out the standards of behaviour
for our employees, contractors and suppliers, covering areas such as conflict of interest, fraud, anti-corruption
and legal compliance, is overseen by our Code of Conduct and People Committee, chaired by the Executive
General Manager, Corporate Relations. MMG engages an independent confidential whistleblower service which
is available to all employees, contractors, suppliers and external stakeholders globally. MMG’s Whistleblower
Framework explains the process for reporting any improper conduct, the protections afforded to people who
report improper conduct, how such reports will be dealt with and the type of action which may be taken as a
result. The Whistleblower Framework is integral to MMG’s Corporate Legal Compliance Standard. In 2022, MMG
updated its stakeholder grievance mechanism to fully align with this framework and additional mechanisms for
anonymously raising grievances, further strengthening protections for stakeholders who raise issues with MMG.
We also have an Anti-Corruption Standard and Framework, and a Supplier Code of Conduct.

All MMG employees including management and directors are informed of and required to comply with the Code
of Conduct and Anti-Corruption Standard and Framework as a condition of their employment. An online training
module is made available to employees and directors and face to face training is conducted from time to time. As
part of our new set of Sustainability performance indicators in effect as of 2022, progress against targets relating
to the percentage of employees required to complete anti-bribery and corruption training modules as well as
grievance response and resolution times are regularly monitored by the MMG Executive Committee and MMG
Board. In 2024, ongoing monitoring will be conducted quarterly by MMG’s Executive Committee and the GRNS
Committee.

We recognise that some of the jurisdictions where we are based present unique human rights challenges.
Because of this, we seek to match good governance with a commitment to transparent initiatives, such as the
Extractive Industries Transparency Initiative (EITI) coupled with open and reciprocal host community discussions.

Data protection including customer data is ensured by the use of SAP, enforcing identification authorisation,
monitored by the Global Business Service. Privacy is controlled by the Company’s Anti-Corruption Framework,
segregation of duties and anti-bribery, anti-corruption and anti-competitive behaviour expectations.

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Confidentiality terms are also defined in all contracts. These processes and frameworks are monitored by legal,
assurance and risk departments. In addition, all corporate technology applications are hosted on Microsoft Azure
cloud, with security design as well as Advanced Protection service procured from Microsoft.

Managing cyber security risk is a priority applied across MMG’s different jurisdictions. All employees are required
to understand and adhere to the acceptable use guidelines outlined in the MMG Technology Work Quality
Requirement (WQR). This sets a safe technology use standard to protect our people and data from the risk of
cyber security attacks, which could compromise MMG systems and services.

In 2023, there were no confirmed significant non-compliances with the Company’s Code of Conduct identified
and no legal cases regarding corrupt practices brought against the Company or its employees.

Developing and supporting our workforce and protecting labour rights

The Company has one standard governing people and benefits matters globally, the People Standard. This
Standard is supported with detailed work quality requirements, systems and processes to ensure global
standards and local requirements are met, which include policies related to compensation and dismissal, working
hours, recruitment and people movements.

The Company is also aligned with all national legislation and legal requirements in the countries where our
operations are located. The Company, through robust selection processes, chooses the best people for each
position and rewards them competitively with salary and benefits that are in line with market conditions and
their contribution to our overall business success. The Company is committed to sharing its successes with our
communities through local employment opportunities and by investing in training and education to help local
residents’ transition to careers in mining or related fields.

The Company provides its people with the opportunity to develop their skills, expertise and experience to
optimise their contribution to our business and to develop their careers. The Company has two broad streams
of vocational training, operational training and competency verification, to drive safety, efficiencies and manage
material business risks.

In addition, the Company enables employees’ professional development to enhance leadership capabilities and
support career pathways. The Company undertakes extensive workforce and community engagement on, and
offers support to, individuals affected by any business decisions to downsize or close operations.

The Company aims to provide safe workplaces that are free of discrimination and harassment, and which
foster diversity and inclusion. The Company also has a global Diversity and Inclusion approach led by the
Executive Committee. The Company, through the Code of Conduct and People Committee, provides guidance
on diversity and inclusion policy and practice, working alongside the regions as they determine diversity and
inclusion initiatives and actions specific to their region. MMG’s approach to inclusion and diversity supports our
comparative advantage in attracting and retaining talent, in addition to delivering business benefits associated
with greater levels of collaboration.

The Company promotes good mental health practices in the workplace and supports our workers to be physically
fit and well rested so that they are able to carry out their duties safely.

We are committed to upholding the International Labour Organisation’s (ILO) Declaration of Fundamental
Principles and Rights at Work and their Core Labour Standards and comply with local labour laws, as a minimum,
and with consideration of the eight core conventions of the ILO focusing on human rights that are directly
applicable to business. This includes the rights of our employees to freedom of association and collective
representation and endeavour to have positive and constructive negotiations with elected representatives of
these groups. The Company also upholds the ILO Principles regarding the elimination of all forms of forced and
child labour.

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In 2023, there were no confirmed non-compliance incidents or grievances in relation to labour practices that
have had a significant impact on the Group.

The following tables represent the Company’s workforce by gender, employment type, age group and
geographical region as well as the employee turnover rate by gender, age group and geographical region.

Table 1: 2023 Total Workforce by Employment Type and Site

Total
Site Permanent Temporary Permanent % Temporary % Workforce
Dugald River 500 357 58% 42% 857
Kinsevere 897 3,874 19% 81% 4,771
Las Bambas 2,578 5,695 31% 69% 8,273
Rosebery 361 239 60% 40% 600
Corporate 186 2 99% 1% 188
Australian Operations 34 0 100% 0% 34
MMG 4,556 10,167 31% 69% 14,723

* Please note that in this table, MMG permanent employees represents employees directly employed by MMG. Temporary employees includes
contractors, consultants and other short-term engagements.
** Headcount for MMG permanent employees is at 31 December 2023. For temporary, this is an average of the total workforce throughout the course of
the year.

Table 2: 2023 Total Permanent Workforce by Gender and Site

Total
Site Female Male Female % Male % Workforce
Dugald River 63 437 13% 87% 500
Kinsevere 130 767 14% 86% 897
Las Bambas 339 2,239 13% 87% 2,578
Rosebery 42 319 12% 88% 361
Corporate 89 97 48% 52% 186
Australian Operations 14 20 41% 59% 34
MMG 677 3,879 15% 85% 4,556

* Please note this table refers to MMG permanent employees directly employed by MMG. This does not include temporary employees, including
contractors or consultants.

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Table 3: 2023 MMG Workforce Turnover Rate by Age Group and Site

Site Age (<30) Age (31-50) Age (>50) Age (<30) Age (31-50) Age (>50)
Dugald River 15 43 10 22% 63% 15%
Kinsevere 2 12 8 9% 55% 36%
Las Bambas 8 88 11 7% 82% 10%
Rosebery 14 30 14 24% 52% 24%
Corporate 3 2 2 43% 29% 29%
Australia Ops 0 0 1 0% 0% 100%
Total 42 175 46 16% 67% 17%

* Please note this table refers to total MMG permanent employees during 2023, including all voluntary resignations for permanent employees. This does
not include temporary employees, including contractors or consultants.
** The workforce turnover rate by age group and site was calculated using the total turnover for each operation, rather than as a percentage of the total
permanent workforce.

Table 4: 2023 MMG Workforce Turnover Rate by Gender and Site

Site Female Male Female (%) Male (%)

Dugald River 9 59 13% 87%
Kinsevere 4 18 18% 82%
Las Bambas 15 92 14% 86%
Rosebery 10 48 17% 83%
Corporate 4 3 57% 43%
Australian Ops 1 0 100% 0%
TOTAL 43 220 16% 84%

* Please note this table refers to total MMG permanent employees during 2023, including all voluntary resignations for permanent employees. This does
not include temporary employees, including contractors or consultants.
** The workforce turnover rate by age group and site was calculated using the total turnover for each operation, rather than as a percentage of the total
permanent workforce.

Table 5: 2023 MMG Permanent Workforce Training by Employee Category

Trained
Trained Workforce Total Trained Avg Trained
Workforce Workforce (%) Hours Hours
Executives – level 5/6 5 2 40% 5.25 1.05
Senior Management – level 4 14 10 71% 248.00 17.71
Middle Management– level 3 108 88 81% 2,103.75 19.48
Lower Management – level 2 301 227 75% 8,288.33 27.54
Employees – level 1 4,128 4,097 99% 180,913.33 43.83
Total 4,556 4,424 97% 191,558.66 42.05

* Please note this table refers to MMG permanent employees directly employed by MMG. This does not include temporary employees, including
contractors or consultants.

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Social performance and stakeholder engagement

We recognise that ongoing, meaningful stakeholder engagement from exploration through to the cessation
of our mining activities is critical in ensuring that our business decisions are responsive to the needs and
expectations of our host communities and governments. We aim to partner with our communities and strive to
maintain socially and culturally inclusive and proactive communication with stakeholders regarding future plans
and performance. MMG’s commitment to the ICMM’s Mining Principles, including the commitment to community
dialogue and position on free, prior and informed consent regarding Indigenous Peoples, guides our approach
to stakeholder engagement. The Company’s responsibilities regarding interactions and contribution to host
communities are further defined in the Company’s Social Performance Standard.

The social and economic benefits we provide through our operations and their supply chains support our
employees, shareholders, communities, regions and host countries to develop and prosper. This contribution
comes through our payment of taxes, royalties, wages and employee entitlements; our purchase of goods and
services; and through community compensation, support for local initiatives, benefit sharing and our direct
investment in addressing the UN SDGs 1–6, as listed below:

SDG1: SDG2: SDG3: Good Health

No Poverty Zero Hunger and Wellbeing

SDG4: SDG5: SDG6: Clean Water

Quality Education Gender Equality and Sanitation

Table 6: 2022 Total Community Investment Spend by Focus Area (USD $)

Investment by SDG Dugald River Kinsevere Las Bambas Rosebery Total

SDG1: No Poverty $5,310 $495,666 $15,387,871 $17,157 $15,906,004
SDG2: Zero Hunger $3,319 $309,578 $3,038,102 $25,221 $3,376,220
SDG3: Good Health and Wellbeing $106,126 $267,322 $3,506,082 $132,501 $4,012,031
SDG4: Quality Education $13,632 $945,490 $6,847,480 $19,387 $7,825,989
SDG5: Gender Equality $14,933 $0 $501,583 $6,836 $523,352
SDG6: Clean Water and Sanitation $0 $42,699 $163,360 $0 $206,059
Total $143,320 $2,060,755 $29,444,478 $201,102 $31,849,655

In addition to improving access to health, education and other livelihood indicators, human development
recognises the importance of managing vulnerability and building community resilience. Communities and
countries must be able to withstand ongoing pressures around social and economic security, as well as the
impacts of development and political instability. We seek to support our communities as they go through this
journey and plan for a resilient, sustainable future.

More information about the Company’s stakeholder engagement approach, as well as social performance and
investment initiatives, can be found in the 2023 MMG Sustainability Report, available in the second quarter of
2024 on www.mmg.com.

In 2023, there were no confirmed non-compliance incidents or grievances in relation to human rights that have
had a significant impact on the Group.

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Supply chain
The Company sources goods and services through a global supply chain to satisfy the requirements of our
operating sites. Our suppliers are essential to our business and our commitments to the environment and social
contributions; hence all suppliers must satisfactorily pass the Company’s Due Diligence requirements prior to the
commencement of any sourcing activity. We value our relationships with qualified suppliers.

The provision of goods and services across our operations is helping local suppliers to develop sustainable
businesses. Where possible, we source from providers who meet our key selection criteria in safety, environment,
quality, technical, social responsibility and commercial viability. Where gaps are identified, we aid our suppliers to
take up future opportunities to grow their businesses and expand their offering to customers beyond MMG.

In 2023, the Company had 6,422 active suppliers, of which 28.4% are in Australia, 33.89% in Peru, 8.39% in the
DRC, 2.81% in South Africa, and 3.17% in China. The rest were distributed among other countries. Our total spend
in 2023 was over US$2,755 million, and over 86.62% were localised expenditures.

The Company’s supplier engagement and contract award process includes a comprehensive assessment across
a range of criteria, including commercial, social, safety, environmental, quality and technical capabilities. As part
of the supplier selection process, we also assess a range of non-financial criteria around supporting sustainable
development in the regions where we work, including local community training and commitment to local
employment.

As part of our supplier engagement process, the Company seeks formal agreement from suppliers to comply with
the Supplier Code of Conduct and Anti-Corruption Framework as well as all relevant Company standards, policies
and procedures, including the Supply, Fatal Risk Management, Human Rights, Social Performance and Safety,
Security, Health and Environment (SSHE) Performance Standards. In 2023 the Company regularly reviewed
and reported on agreed contract performance measures, as well as identified and actioned improvement
opportunities.

In 2023, there were no confirmed non-compliance incidents or grievances in relation to supply chain
management that have had a significant impact on the Group.

Product stewardship
The Company aims to supply metal and metal concentrate products that consistently meet customer quality
expectations and that are safe for people and the environment in their intended use. The Company has
processes for managing customer complaints to facilitate timely and satisfactory resolution.

The Product Stewardship Procedure guides activities to understand the characteristics of the Company’s
products and manage its potential impacts on human health and the environment during transportation, storage
and handling. Shipments of copper, zinc and lead concentrates comply with international maritime legislation
and the Company’s products are classified in line with the International Maritime Organisation’s (IMO) MARPOL
Convention Annex V and the International Maritime Solid Bulk Cargoes Code. Most products are delivered by
standard bulk container process without packaging materials. Las Bambas molybdenum concentrate is packed in
non-returnable bags and loaded for shipment in ISO general purpose shipping containers.

The Company’s global customers also have a shared responsibility for managing impacts throughout the life
cycle of the goods they make from downstream processing of our products.

Products sold by the Company are commodities of which intellectual property is not applicable. The quality of
products is priced with multiple commercial terms such as payable and claims in a wide range without recall.
Therefore, no products sold or shipped are subject to recalls for safety and health reasons.

In 2023, the Company is not aware of any significant incidents of non-compliance with regulations and voluntary
codes concerning the provision and use of the Company’s products and services that have had a significant
impact on the Company.

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Health and safety

The Company’s first value is safety with a commitment to eliminating fatalities and reduction of incidents and
injuries at the workplace. The Company’s Safety, Security, Health, Environment and Community (SSHEC) Policy,
standards, work quality requirements and procedures collectively define the way work should be planned,
assigned and executed to achieve safe outcomes. These standards include safety, security, health and
environment (Fatal Risk, SSHE Performance Standards), contract management (Supply and Insurance Standard),
project management (Project Standard), plant and equipment maintenance (Production and Maintenance
Standard) and learning from events (Risk Management Standard).

The Company’s focus on driving a safety mindset is embedded with supporting leadership and key processes in
every area of the business.

Four key elements in developing an organisational culture with a strong and effective focus on safety and health
has been identified including:

1. Leadership and culture, with sites aligned to common MMG leadership attributes.
2. Elimination of fatalities (low-probability, high consequence events) consistent with the requirements of our
Fatal Risk Standard.
3. Prevention of injuries (high-probability events) consistent with the requirements of our Safety, Security,
Health and Environment (SSHE) Performance Standard.
4. Application of learnings from incidents in line with the requirements of our internal safety and health
standards.

The company’s approach is based on avoiding harm to our people. MMG is committed to continuous
improvement in their approach to managing safety. Through our Safety Leadership Program, the Company strive
to develop a culture where safety leadership is supported through:

• a commitment to caring for each other and living MMG’s values;

• building safety capability and commitment in MMG people;
• training MMG’s people to be competent in all their tasks;
• enabling MMG frontline leaders to effectively implement MMG standards and processes; and
• continually supporting and enabling safe behaviour.

Despite the Company’s commitment to a safety-first culture and to ensuring that supporting behaviours and
processes are in place across every area of our operations, we sadly report that two Barminco contractors
were fatally injured at the Dugald River mine on Wednesday 15 February 2023 when the light vehicle they were
travelling in fell into a stope.

At the end of 2023, the total recordable injury frequency rate (TRIF) for the Company was 1.97 per million hours
worked.

The Company is committed to doing more to achieve its target of zero fatalities and reduce the recordable
injuries. 69 people across the Company’s operations in 2023 experienced injuries that required medical
treatment, time away from work or resulted in them being unable to perform their normal duties for a period
of time. The lost time injury frequency rate (LTIF) was 0.43 for 2023.

In 2023, MMG received no significant safety related fines or non-monetary sanctions.

Environment
The Company is committed to minimising our environmental footprint through the efficient use of natural
resources, management of waste produced and effective life-cycle management. The Company is focused on
managing our impacts and align our environmental and biodiversity activities with our life-of-asset plans.

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The Company’s SSHEC Policy, SSHE Performance Standard defines minimum requirements for the management
of water, greenhouse gases emission (GHG) reduction measures, mineral and non-mineral wastes, land,
biodiversity and cultural heritage, air, noise and vibration, and all sites are required to comply with these
requirements.

The Company’s approach to environmental management and impact is based on the principle of continuous
improvement and is aligned to the ISO14001. The approach involves identification, assessment and control
of material environmental risks across all phases of our business, from exploration through to development,
operation and closure. Further, the SSHE Performance Standard sets the benchmark for the efficient use of
resources and minimisation of environmental impacts from our operations that include mining, processing and
transportation.

Site compliance with the requirements of the SSHE Performance Standard is internally audited as part of an
integrated assurance process.

The Company acknowledges human induced climate change and its impacts on the environment, the economy
and communities. As extreme weather events continued to intensify globally, the Company’s need to assess
and build resilience became more important than ever. The Company is dedicated to being part of the global
solution through the provision of minerals and metals required in a low carbon future and by committing to net
zero emissions by 2050. MMG set a Net Zero by 2050 GHG emissions target and an interim reduction target
of 40% in Scopes 1 and 2 emissions by 2030, from a 2020 baseline. A climate strategy, which was developed
and approved by the Board in March 2022, strengthening our commitment to reduce GHG emissions, is under
implementation.

MMG’s Climate Strategy is tied to business planning, with all sites determining potential decarbonisation
pathways and credible timelines for implementing greenhouse gas (GHG) reduction opportunities. Carbon
emissions data, reporting and projections have been strengthened, and a Scope 3 emissions (indirect
greenhouse gases) inventory was developed in 2023 together with customers and suppliers. Transitioning to
100% renewable electricity supply is the fastest and most reliable way to cut emissions, as technology is still
being developed to displace diesel from mobile equipment fleets. MMG is committed to strengthening GHG
emission data collection, reporting, risk assessment and future projections. These steps will boost transparency
of how MMG tracks and publicly discloses GHG emission targets, reinforcing a key company value: ‘We do
what we say’. MMG will also stress-test emission projections under several climate change and carbon pricing
scenarios to strengthen the climate strategy.

Further information can be found in the 2023 MMG Sustainability Report available at www.mmg.com.

The Company tracks and monitors hazardous and non-hazardous waste types and volumes, with opportunities
for waste reduction and efficacy highlighted through reporting processes. Hazardous waste is managed as
per state and national regulations with certified contractors transporting to appropriate waste facilities. The
Company faces no challenges in sourcing water that is fit for purpose. As part of the new set of sustainability
performance indicators, progress towards performance at optimal level of compliance against Global Industry
Standard on Tailings Management will be monitored quarterly by the Executive Committee including waste
reduction and water efficiency.

In 2023, there were no significant fines or penalties related to environmental management that have had a
significant impact on the Group.

Information and data relating to the type and total air and greenhouse gas emissions, hazardous and non-
hazardous waste produced, direct and indirect energy consumption and water consumption are listed in the
2023 Environmental Data section below and are managed in accordance with the Environmental Standard and
core principles of ISO14001.

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2023 Environmental data

Consistent with our internal reporting, energy consumption is listed in gigajoules (GJ), emissions to air and waste
is reported in tonnes, and water is reported in megalitres (ML). For consistency, ratios are calculated on a per
tonne of ore milled or per thousand tonnes of ore milled basis.

Table 7: Total energy consumption (GJ)

Site 2023 2022

Dugald River 977,739 1,003,563*
Kinsevere 1,664,047 1,279,561
Las Bambas 11,904,131 9,862,987
Rosebery 778,917 743,624
MMG Total 15,324,834 12,889,735*

* 2022 value updated due to adjustment in calculation method (non-material).

Note: Energy consumption made up of a mix of sources, including diesel, LPG, on grid electricity, explosives and others.

Table 8: Energy consumption (GJ/tonnes milled)

Site 2023 2022

Dugald River 0.59 0.54
Kinsevere 0.79 0.54
Las Bambas 0.23 0.22
Rosebery 0.85 0.83
MMG Total 0.27 0.26

Table 9: Direct and indirect energy consumption (GJ)

Site and year Direct energy consumption Indirect energy consumption

Dugald River
2023 271,208 706,531
2022 235,618* 767,944*
Kinsevere
2023 1,160,907 503,140
2022 788,181 491,380
Las Bambas
2023 7,184,943 4,719,188
2022 6,154,606 3,708,381
Rosebery
2023 234,996 543,921
2022 227,623* 516,002*
MMG Total
2023 8,852,054 6,472,780
2022 7,406,028* 5,483,707*

* 2022 value updated due to adjustment in calculation method (non-material)

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ESG Approach
and Performance
Continued

Table 10: Total greenhouse gas emissions (tonnes CO2-e)

Site and year Direct GHG emissions Indirect GHG emissions Total
Dugald River
2023 18,542 61,502 80,044
2022 15,783* 91,894* 107,677*
Kinsevere
2023 80,337 1,537 81,874
2022 54,455* 8,599 63,054*
Las Bambas
2023 477,686 260,205 737,891
2022 416,473 206,580 623,053
Rosebery
2023 15,741 25,685 41,426
2022 15,267* 23,662 38,929*
MMG Total
2023 592,306 348,929 941,235
2022 501,978* 330,735* 832,713*

* 2022 value updated due to adjustment in calculation method (non-material).

Table 11: Greenhouse gas (GHG) emissions (tonnes CO2-e/’000 tonnes milled)

Site 2023 2022

Dugald River 48.22 58.39*
Kinsevere 38.85 26.85
Las Bambas 13.96 14.15
Rosebery 45.12 43.40
MMG Total 16.35 16.94*

* 2022 value updated due to adjustment in calculation method.

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ESG Approach
and Performance
Continued

Table 12: Air emissions (tonnes)

2023 2022
Oxides of Nitrogen (NOx)
Dugald River 0 99
Kinsevere 61,756 58,975
Las Bambas 17,804 16,271
Rosebery 99 92
MMG Total 79,659 75,437
Oxides of Sulphur (SOx)
Dugald River 0 0
Kinsevere 112 110
Las Bambas 22 26
Rosebery 0 0
MMG Total 134 136
Particulate Matter (PM10)
Dugald River 390 360
Kinsevere 15,983 15,715
Las Bambas 2,932 3,606
Rosebery 360 328
MMG Total 19,665 20,009
Volatile Organic Compounds (VOCs)
Dugald River 16 12
Kinsevere 3,039 2,853
Las Bambas 864 791
Rosebery 7 7
MMG Total 3,926 3,663

Table 13: Total hazardous waste (tonnes)

Site 2023 2022

Dugald River 295 187
Kinsevere 108 79
Las Bambas 2,590 2,022
Rosebery 399 471*
MMG Total 3,392 2,759*

* 2022 value updated due to adjustment in calculation method (non-material)

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and Performance
Continued

Table 14: Hazardous waste produced (tonnes/’000 tonnes milled)

Site 2023 2022

Dugald River 0.18 0.10
Kinsevere 0.05 0.03
Las Bambas 0.05 0.05
Rosebery 0.43 0.53*
MMG Total 0.06 0.06

* 2022 value updated due to adjustment in calculation method (non-material)

Table 15: Total non-hazardous waste (tonnes)

Site 2023 2022

Dugald River 1,699 2,434
Kinsevere 601 366
Las Bambas 14,032 10,938
Rosebery 1,756 1,885
MMG Total 18,088 15,623

Table 16: Non-hazardous waste produced (tonnes/’000 tonnes milled)

Site 2023 2022

Dugald River 1.02 1.32
Kinsevere 0.29 0.16
Las Bambas 0.27 0.25
Rosebery 1.91 2.10
MMG Total 0.31 0.32

Table 17: Total water consumption (ML)

Site 2023 2022

Dugald River 2,171 1,941*
Kinsevere 4,634 4,217*
Las Bambas 18,496 15,224
Rosebery 704 763*
MMG Total 26,005 22,145*

* 2022 value updated due to adjustment in calculation method (non-material)

Table 18: Total water consumption (ML/’000 tonnes milled)

Site 2023 2022

Dugald River 1.31 1.05*
Kinsevere 2.20 1.80*
Las Bambas 0.35 0.35
Rosebery 0.77 0.85*
MMG Total 0.45 0.45*

* 2022 value updated due to adjustment in calculation method (non-material)

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Independent
Auditor’s Report

To the Members of MMG Limited

(incorporated in Hong Kong with limited liability)

Opinion

We have audited the consolidated financial statements of MMG Limited (the “Company”) and its subsidiaries
(collectively referred to as the “Group”) set out on pages 117 to 203, which comprise the consolidated statement
of financial position as at 31 December 2023, and the consolidated statement of profit or loss, consolidated
statement of comprehensive income, consolidated statement of changes in equity and consolidated statement
of cash flows for the year then ended, and notes to the consolidated financial statements, including material
accounting policy information and other explanatory information.

In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial
position of the Group as at 31 December 2023, and of its consolidated financial performance and its
consolidated cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards
(“HKFRSs”) issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”) and have been properly
prepared in compliance with the Hong Kong Companies Ordinance.

Basis for Opinion

We conducted our audit in accordance with Hong Kong Standards on Auditing (“HKSAs”) issued by the HKICPA.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of
the Consolidated Financial Statements section of our report. We are independent of the Group in accordance
with the HKICPA’s Code of Ethics for Professional Accountants (the “Code”), and we have fulfilled our other
ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements of the current period. These matters were addressed in the context of
our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.

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Independent
Auditor’s Report
Continued

To the Members of MMG Limited – continued

(incorporated in Hong Kong with limited liability)

Key Audit Matters – continued

Key audit matters How our audit addressed the key audit matters
Impairment of goodwill and other non-current assets – Las Bambas
We identified the impairment of goodwill and Our procedures in relation to the impairment
other non-current assets for the Las Bambas cash assessment of goodwill and other non-current assets
generating unit (“CGU”) as a key audit matter due for the Las Bambas CGU included:
to the significance of these balances in the Group’s
• Testing key controls over the valuation of the Las
consolidated statement of financial position. In
Bambas CGU’s non-financial assets and goodwill,
addition, the estimation of recoverable amount of the
including those to determine asset impairments;
Las Bambas CGU involves complex and subjective
estimates based on management’s judgement of • Working with valuation specialists to:
key variables and market conditions such as future
՞ Evaluate the appropriateness of the model used by
commodity prices, future exchange rates, future
management to calcu-late the fair value less cost of
operating performance, the timing and approval of
disposal of the Las Bambas CGU;
future capital and operating expenditure, and the
discount rate. ՞ Assess and challenge the reasonable-ness of the
key assumptions such as forecast commodity
As at 31 December 2023, the Las Bambas CGU has prices, discount rates, including country specific risk
segment non-current assets, which mainly comprise rates used, and comparing them to ex-ternal market
of property, plant and equipment and goodwill, details data;
of which are set out in notes 4, 12 and 14 to the
՞ Review and assess the appropriateness of mining-
consolidated financial statements.
based assumptions, including dilution and recovery
Goodwill is required to be tested for impairment rates, ore grades and ramp-up profiles included
annually. As a result, management completed within the models; and
impairment testing for the Las Bambas CGU as at 31 ՞ Challenge management’s sensitivity analysis on key
December 2023. Following management’s assessment, variables (e.g. com-modity pricing and discount rate).
no impairment has been recognised for the year ended
31 December 2023. • Analysing the future projected cash flows used in
the model to determine whether they are reasonable
and supportable given the current macroeconomic
climate, the political environment in Peru and the
expected future performance of the Las Bambas
CGU;
• Evaluating the competence and objectivity of
management’s experts who assisted in the valuation,
including those who prepared the resource and
reserve estimates;
• Evaluating comparable market transactions that
support the valuation of exploration potential value
included in the Las Bambas CGU; and
• Assessing the appropriateness of the related
disclosures included in notes 4, 12 and 14 to the
consolidated financial statements.

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Independent
Auditor’s Report
Continued

To the Members of MMG Limited – continued

(incorporated in Hong Kong with limited liability)

Key Audit Matters – continued

Accounting for uncertain tax matters

We identified the accounting for uncertain tax matters Our procedures in relation to the accounting for
as a key audit matter due to the Group’s related uncertain tax matters included:
party relationships and associated tax implications
• Testing key controls relating to the accounting for and
of substantial transactions, the significant judgement
the disclosure of tax related transactions and matters;
involved in the determination of the tax positions
and the relevant estimates and assumptions in light • Working with tax specialists in Australia, Peru and
of the number of jurisdictions in which the Group Democratic Republic of Congo to evaluate the Group’s
operates, including judgement concerning residency tax obligations, review tax computations of the Group,
of key operations and holding companies, application obtain an understanding of the current status of
of transfer pricing rules, the recognition of deferred tax assessments and investigations and to evaluate
income tax assets, the taxation impacts of any developments in ongoing tax disputes, if any;
corporate restructurings and the recognition and • Assessing the recognition and measurement of any
measurement of provisions for tax exposures that may relevant deferred tax assets, deferred tax liabilities
arise and associated disclosures. and current provisions for tax;
This gives rise to complexity and uncertainty in respect • Reading recent rulings, correspondence with local
of the calculation of income taxes and deferred tax authorities and the advices from management’s
taxation and consideration of contingent liabilities external tax advisors with the assistance from our tax
associated with tax years open to audit. specialists, to satisfy ourselves that the tax provisions
recognised or contingent liabilities disclosed have
As at 31 December 2023, the Group operates across been appropriately recorded or adjusted to reflect the
a number of jurisdictions and is subject to periodic latest external developments;
challenges by local tax authorities on a range of tax
• Assessing the Group’s related party relationships
matters during the normal course of business, including
for any transactions and associated tax implications
transfer pricing, indirect taxes, change of taxation
outside the normal course of business; and
laws, and transaction related tax matters as disclosed
in notes 3.2(a), 8, 18, 19, and 35 to the consolidated • Assessing the appropriateness of the related
financial statements. disclosures included in notes 3.2(a), 8, 18, 19, and 35
to the consolidated financial statements.

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Independent
Auditor’s Report
Continued

To the Members of MMG Limited – continued

(incorporated in Hong Kong with limited liability)

Other Information

The directors of the Company are responsible for the other information. The other information comprises the
information included in the annual report, but does not include the consolidated financial statements and our
auditor’s report thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Directors and Those Charged with Governance for the Consolidated Financial Statements

The directors of the Company are responsible for the preparation of the consolidated financial statements that
give a true and fair view in accordance with HKFRSs issued by the HKICPA and the Hong Kong Companies
Ordinance, and for such internal control as the directors determine is necessary to enable the preparation of
consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or
have no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group’s financial reporting process.

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Independent
Auditor’s Report
Continued

To the Members of MMG Limited – continued

(incorporated in Hong Kong with limited liability)

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion solely to you, as a body, in accordance with section 405 of the Hong Kong Companies
Ordinance, and for no other purpose. We do not assume responsibility towards or accept liability to any other
person for the contents of this report. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with HKSAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.

As part of an audit in accordance with HKSAs, we exercise professional judgement and maintain professional
skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.

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Independent
Auditor’s Report
Continued

To the Members of MMG Limited – continued

(incorporated in Hong Kong with limited liability)

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements – continued

We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.

From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the consolidated financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in the independent auditor’s report is Lee Wing Cheong, Wilfred.

Deloitte Touche Tohmatsu

Certified Public Accountants
Hong Kong

5 March 2024

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Contents

Consolidated Statement of Profit or Loss 117

Consolidated Statement of Comprehensive Income 118
Consolidated Statement of Financial Position 119
Consolidated Statement of Changes In Equity 121
Consolidated Statement of Cash Flows 122
1. General Information 123
2. Summary of Material Accounting Policies 123
3. Critical Accounting Estimates and Judgements 142
4. Segment Information 145
5. Net Other (Expense)/Income 148
6. Expenses 148
7. Finance Income and Finance Costs 149
8. Income Tax Expense 150
9. Earnings Per Share 151
10. Dividends 151
11. Employee Benefit Expenses, Including Directors’ Emoluments 152
12. Property, Plant and Equipment 153
13. Right-of-Use Assets 158
14. Intangible Assets 159
15. Investment in Subsidiaries 160
16. Principal Subsidiaries with Material Non-Controlling Interests 162
17. Inventories 163
18. Deferred Income Tax 163
19. Trade and Other Receivables 164
20. Derivative Financial Assets/(Liabilities) 165
21. Other Financial Assets 165
22. Cash and Cash Equivalents 166
23. Share Capital 166
24. Reserves and Retained Profits 167
25. Borrowings 169
26. Lease Liabilities 171
27. Provisions 172
28. Trade and Other Payables 173
29. Notes To Consolidated Statement of Cash Flows 174
30. Significant Related Party Transactions 175
31. Financial and Other Risk Management 177
32. Directors’ and Senior Management’s Emoluments 188
33. Long-Term Incentive Plans 191
34. Commitments 198
35. Contingent Liabilities 199
36. Events After the End of the Reporting Period 201
37. Company Statement of Financial Position, Reserves and Accumulated Losses 202
Five-Year Financial Summary 204

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Consolidated Statement
of Profit or Loss

Year ended 31 December

2023 2022
Notes US$ million US$ million
Revenue 4 4,346.5 3,254.2
Net other (expense)/income 5 (2.2) 2.4
Expenses (excluding depreciation and amortisation) 6 (2,882.4) (1,721.2)
Earnings before interest, income tax, depreciation and amortisation – EBITDA 1,461.9 1,535.4
Depreciation and amortisation expenses 6 (930.2) (790.1)
Earnings before interest and income tax – EBIT 531.7 745.3
Finance income 7 24.3 15.0
Finance costs 7 (366.4) (299.8)
Profit before income tax 189.6 460.5
Income tax expense 8 (67.5) (217.0)
Profit for the year 122.1 243.5

Profit for the year attributable to:

Equity holders of the Company 9.0 172.4
Non-controlling interests 113.1 71.1
122.1 243.5
Earnings per share attributable to equity holders of the Company
Basic earnings per share 9 US 0.10 cents US 2.00 cents
Diluted earnings per share 9 US 0.10 cents US 1.98 cents

The accompanying notes are an integral part of these consolidated financial statements.

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Consolidated Statement
of Comprehensive Income

Year ended 31 December

2023 2022
US$ million US$ million
Profit for the year 122.1 243.5

Other comprehensive (loss)/income

Items that may be reclassified to profit or loss
Movement on hedging instruments designated as cash flow hedges (54.9) 82.1
Income tax expense relating to cash flow hedges 17.6 (26.3)
Item that may not be reclassified to profit or loss
Remeasurement on the net defined benefit liability (1.0) -
Other comprehensive (loss)/income for the year, net of income tax (38.3) 55.8

Total comprehensive income for the year 83.8 299.3

Attributable to:
Equity holders of the Company (15.3) 207.3
Non-controlling interests 99.1 92.0
83.8 299.3

The accompanying notes are an integral part of these consolidated financial statements.

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Consolidated Statement
of Financial Position

Year ended 31 December

2023 2022
Notes US$ million US$ million
ASSETS
Non-current assets
Property, plant and equipment 12 9,417.1 9,509.4
Right-of-use assets 13 118.1 111.2
Intangible assets 14 534.0 534.2
Inventories 17 115.0 122.2
Deferred income tax assets 18 150.0 315.7
Other receivables 19 168.8 167.5
Derivative financial assets 20 - 113.9
Other financial assets 21 2.7 1.5
Total non-current assets 10,505.7 10,875.6
Current assets
Inventories 17 389.5 872.6
Trade and other receivables 19 476.0 342.5
Current income tax assets 79.5 60.5
Derivative financial assets 20 3.1 12.1
Cash and cash equivalents 22 447.0 372.2
Total current assets 1,395.1 1,659.9
Total assets 11,900.8 12,535.5

EQUITY
Capital and reserves attributable to equity
holders of the Company
Share capital 23 3,224.6 3,220.5
Reserves and retained profits 24 (1,101.2) (1,081.5)
2,123.4 2,139.0
Non-controlling interests 16 2,188.6 2,089.5
Total equity 4,312.0 4,228.5

The accompanying notes are an integral part of these consolidated financial statements.

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Consolidated Statement
of Financial Position
Continued

Year ended 31 December

2023 2022
Notes US$ million US$ million
LIABILITIES
Non-current liabilities
Borrowings 25 3,375.8 4,209.6
Lease liabilities 26 125.6 117.4
Provisions 27 647.0 599.2
Trade and other payables 28 286.5 217.5
Deferred income tax liabilities 18 952.7 1,208.0
Total non-current liabilities 5,387.6 6,351.7
Current liabilities
Borrowings 25 1,331.3 1,203.0
Lease liabilities 26 22.0 21.3
Provisions 27 127.3 81.0
Derivative financial liabilities 20 - 0.3
Trade and other payables 28 616.4 535.5
Current income tax liabilities 104.2 114.2
Total current liabilities 2,201.2 1,955.3
Total liabilities 7,588.8 8,307.0
Net current liabilities (806.1) (295.4)
Total equity and liabilities 11,900.8 12,535.5

The accompanying notes are an integral part of these consolidated financial statements.

LI Liangang XU Jiqing
Interim CEO and Executive Director Chairman of the Board and Non-Executive Director

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Consolidated Statement
of Changes in Equity

Attributable To Equity Holders Of The Company

Non-
Share Total Retained Controlling Total
US$ million Capital Reserves Profits Total Interests Equity
(Note 23) (Note 24) (Note 24) (Note 16)
At 1 January 2023 3,220.5 (1,826.7) 745.2 2,139.0 2,089.5 4,228.5
Profit for the year - - 9.0 9.0 113.1 122.1
Other comprehensive loss - (24.3) - (24.3) (14.0) (38.3)
Total comprehensive (loss)/income for the year - (24.3) 9.0 (15.3) 99.1 83.8
Provision of surplus reserve - 0.4 (0.4) - - -
Employee long-term incentives - (1.5) - (1.5) - (1.5)
Employee share options and performance
awards vested and exercised 4.1 (2.9) - 1.2 - 1.2
Employee share options and performance
awards lapsed - (0.1) 0.1 - - -
Total transactions with owners 4.1 (4.1) (0.3) (0.3) - (0.3)
At 31 December 2023 3,224.6 (1,855.1) 753.9 2,123.4 2,188.6 4,312.0

The accompanying notes are an integral part of these consolidated financial statements.

Attributable To Equity Holders Of The Company

Non-
Share Total Retained Controlling Total
US$ million Capital Reserves Profits Total Interests Equity
(Note 23) (Note 24) (Note 24) (Note 16)
At 1 January 2022 3,220.3 (1,862.7) 572.9 1,930.5 1,997.5 3,928.0
Profit for the year - - 172.4 172.4 71.1 243.5
Other comprehensive income - 34.9 - 34.9 20.9 55.8
Total comprehensive income for the year - 34.9 172.4 207.3 92.0 299.3
Provision of surplus reserve - 0.1 (0.1) - - -
Employee long-term incentives - 1.1 - 1.1 - 1.1
Employee share options exercised and vested 0.2 (0.1) - 0.1 - 0.1
Total transactions with owners 0.2 1.1 (0.1) 1.2 - 1.2
At 31 December 2022 3,220.5 (1,826.7) 745.2 2,139.0 2,089.5 4,228.5

The accompanying notes are an integral part of these consolidated financial statements.

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Consolidated Statement
of Cash Flows

Year Ended 31 December

2023 2022
Notes US$ million US$ million
Cash flows from operating activities
Receipts from customers 4,605.3 3,402.1
Payments to suppliers and employees (2,621.8) (2,319.9)
Payments for exploration expenditure (49.6) (30.8)
Income tax paid (79.1) (268.0)
Net settlement of commodity hedges (4.9) 48.7
Net cash generated from operating activities 29 1,849.9 832.1

Cash flows from investing activities

Purchase of property, plant and equipment 29 (790.0) (564.5)
Purchase of intangible assets (1.2) (1.7)
Proceeds from disposal of subsidiary - 27.5
Proceeds from disposal of property, plant and equipment 1.2 -
Net cash used in investing activities (790.0) (538.7)

Cash flows from financing activities

Proceeds from external borrowings 25 1,650.0 500.0
Repayments of external borrowings 25 (2,458.8) (1,491.4)
Proceeds from related party borrowing 25 1,150.0 200.0
Repayments of related party borrowing 25 (1,050.0) (100.0)
Net settlement of interest rate swap 132.4 17.9
Proceeds from shares issued upon exercise of employee share options 1.2 0.1
Repayment of lease liabilities 26 (37.7) (31.2)
Interest and financing costs paid on external borrowings (279.0) (182.2)
Interest and financing costs paid on related party borrowings (100.3) (95.6)
Withholding taxes paid in respect of financing arrangements (14.6) (9.1)
Interest received 21.7 15.0
Net cash used in financing activities (985.1) (1,176.5)

Net increase/(decrease) in cash and cash equivalents 74.8 (883.1)

Cash and cash equivalents at 1 January 372.2 1,255.3
Cash and cash equivalents at 31 December 22 447.0 372.2

The accompanying notes are an integral part of these consolidated financial statements.

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Notes to Consolidated Financial Statements

1. General Information
MMG Limited (the “Company”) is a limited liability company and was incorporated in Hong Kong on 29 July
1988. The address of its registered office is Unit 1208, 12/F, China Minmetals Tower, 79 Chatham Road South,
Tsimshatsui, Kowloon, Hong Kong. The principal place of business of the Company is disclosed in the Corporate
Information section to the Group’s 2023 Annual Report.

The Company is an investment holding company listed on the main board of The Stock Exchange of Hong Kong
Limited (“HKEx”).

The Company and its subsidiaries (the “Group”) are engaged in the exploration, development and mining of
copper, zinc, gold, silver, molybdenum and lead deposits around the world.

The consolidated financial statements for the year ended 31 December 2023 are presented in United States
dollars (“US$”) unless otherwise stated and were approved for issue by the Board of Directors of the Company
(the “Board”) on 5 March 2024.

2. Summary of Material Accounting Policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set
out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

The consolidated financial statements of the Group have been prepared in accordance with Hong Kong Financial
Reporting Standards (“HKFRSs”) – a collective term that includes all applicable individual Hong Kong Financial
Reporting Standards, Hong Kong Accounting Standards (“HKAS”) and Interpretations issued by the Hong Kong
Institute of Certified Public Accountants (“HKICPA”). These consolidated financial statements have been prepared
under the historical cost convention, except for financial assets and financial liabilities at fair value through profit
or loss which are measured at fair value.

The preparation of consolidated financial statements in accordance with HKFRSs requires the use of certain
critical accounting estimates. It also requires management to exercise their judgement in the process of applying
the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3.

(a) Going Concern

The consolidated financial statements have been prepared on the going concern basis which assumes the
continuity of normal business activity and the realisation of assets and the settlement of liabilities in the normal
course of business. Management of the Group continues to closely monitor the liquidity position of the Group,
which includes the sensitised analysis of forecast cash balances for key financial risks (including commodity and
foreign exchange risks) over the short and medium term to ensure adequate liquidity is maintained.

As at 31 December 2023, the Group had net current liabilities of US$806.1 million (31 December 2022:
US$295.4 million) and cash and cash equivalents of US$447.0 million (31 December 2022: US$372.2 million).
For the year ended 31 December 2023, the Group generated a net profit of US$122.1 million
(2022: US$243.5 million) and operational net cash inflows of US$1,849.9 million (2022: US$832.1 million).

Cash flow forecasts include drawdowns from existing and new credit facilities and assume the successful
extension of revolving credit facilities (“RCF”). With the inclusion of these assumptions, the Group will have
sufficient liquidity to meet its operational, existing contractual debt service and capital expenditure requirements
for the 12-month period from the approval of the consolidated financial statements.

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Management notes the following considerations, relevant to the Group’s ability to continue as a going concern:

• At 31 December 2023, total cash and cash equivalents of US$447.0 million (2022: US$372.2 million) were held
by the Group;
• The Group has US$4,325.0 million undrawn facilities as at the date that the financial statements are authorised
to be issue:

֢ A US$350.0 million undrawn RCF from Album Enterprises Limited (“Album Enterprises”) (a subsidiary of China
Minmetals Non-ferrous Metals Co., Ltd (“CMN”)) which will expire in August 2024;
֢ A new US$275.0 million undrawn RCF from Bank of China (“BOC”) which will expire in April 2026;
֢ A new US$150.0 million undrawn RCF from Industrial and Commercial Bank of China (“ICBC”) consisting of
three tranches of US$50.0 million each set to expire in March, May and June 2026;
֢ A new US$100.0 million undrawn RCF from Bank of Communication (“BOCOM”) which will expire in August
2026;
֢ A new US$200.0 million RCF from China Construction Bank (“CCB”) of which US$50.0 million remains
undrawn. It will expire in January 2027;
֢ A new US$100.0 million undrawn RCF from CCB which will expire in February 2027;
֢ A new US$1,000.0 million undrawn RCF from Top Create Resources Limited (“Top Create”) (a subsidiary of
CMN). This facility will expire in December 2026;
֢ A new US$300.0 million Term Loan Facility from Top Create that supports the Kinsevere Expansion Project
(“KEP”) project which will expire in December 2030; and
֢ A shareholder term loan facility of US$2,000.0 million from Top Create to support the acquisition of the
Cuprous Capital Ltd (“CCL”) and its subsidiaries (refer to Note 36 for more details).
• The Group expects to obtain, renew or extend a number of facilities:

֢ A new RCF of US$700.0 million from syndicated banks currently being negotiated;
֢ A new US$44.0 million term loan from external banks currently being negotiated to support the operations of
Kinsevere;
֢ New RCFs of US$200.0 million with external banks; and
֢ The Tranche A repayment of the US$2,161.3 million term loan from Top Create of US $700.0 million is due in
July 2024 but is expected to be deferred for three years.
In the event that forecast cash flow is not achieved or if existing or new debt facilities are insufficient or
not obtained in a timely manner, the Group has the ongoing support of its major shareholder, CMN and its
subsidiaries. Support to the Group may be in the form of providing additional debt facilities, deferral of debt
service and repayment obligations in relation to existing shareholder loans from CMN, early payments for
shipments of commodity or through further equity contributions.

Based on the above, and a review of the forecast financial position and results of the Group for the twelve
months from approval of these consolidated financial statements, the directors are thus of the view that the
Group will be able to meet its debts as and when they fall due and accordingly the consolidated financial
statements have been prepared on the going concern basis.

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(b) New standards and amendments to existing standards effective and adopted in 2023 with no significant
impact to the Group

HKFRS 17 (including the October 2020 and February 2022

Amendments to HKFRS 17) Insurance Contracts1
Amendments to HKAS 8 Definition of Accounting Estimates1
Deferred Tax related to Assets and Liabilities arising from a
Amendments to HKAS 12 Single Transaction1
Amendments to HKAS 1 and HKFRS Practice Statement 2 Disclosure of Accounting Policies1
Amendments to HKAS 12 International Tax Reform-Pillar Two model Rules

1 The application of the new HKFRS in the current year has had no material impact on the Group’s financial positions and performance for the current
and prior years and/or on the disclosures set out in these consolidated financial statements.

Impacts on application of amendments to HKAS 12 “Income Taxes International Tax Reform-Pillar Two model Rules”

The Group has applied the amendments for the first time in the current year. HKAS 12 is amended to add the
exception to recognising and disclosing information about deferred tax assets and liabilities that are related to
tax law enacted or substantively enacted to implement the Pillar Two model rules published by the Organisation
for Economic Co-operation and Development (the “Pillar Two legislation”). The amendments require that entities
apply the amendments immediately upon issuance and retrospectively. The amendments also require that
entities disclose separately its current tax expense/income related to Pillar Two income taxes in periods which
the Pillar Two legislation is in effect, and the qualitative and quantitative information about its exposure to Pillar
Two income taxes in periods in which the Pillar Two legislation is enacted or substantially enacted but not yet in
effect in annual reporting periods beginning on or after 1 January 2023.

The Group has applied the temporary exception immediately upon issue of these amendments and
retrospectively, i.e. applying the exception from the date Pillar Two legislation is enacted or substantially
enacted. The qualitative and quantitative information about the Group’s exposure to Pillar Two income taxes is
set out in Note 8.

In addition, the Group applied the following agenda decision of the Committee of the International Accounting
Standards Board (“IASB”) which is relevant to the Group given that HKFRSs Standards are largely aligned with
IFRS Standards, the agenda decision of the Committee is equally applicable:

Definition of a Lease - Substitution Rights (IFRS 16 Leases)

In April 2023, the Committee published the agenda decision which addressed: (i) the level at which to evaluate
whether a contract contains a lease when the contract is for the use of more than one similar asset i.e. by
considering each asset separately or all assets together; and (ii) how to assess whether a contract contains a
lease applying IFRS 16 when the supplier has substitution rights to substitute alternative assets, but would not
benefit economically from the exercise of its right to substitute the asset throughout the period of use.

The Committee concluded that, (i) the level to assess whether the contract contains a lease is at each identified
asset level; and (ii) the supplier’s right is not substantive because the supplier is not expected to benefit
economically from exercising its right to substitute an asset throughout the period of use.

The application of the Committee’s agenda decision has had no material impact on the Group’s consolidated
financial statements.

(c) Amendments to standards that have been issued but not yet effective or early adopted by the Group

The Group has not early adopted the following amendments to standards that have been issued but are not
effective for financial year 2023.

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Amendments to HKFRS 10 and HKAS 28 Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture1
Amendments to HKFRS 16 Lease Liability in a Sale and Leaseback2
Amendments to HKAS 1 Classification of Liabilities as Current or Non-current and related
amendments to Hong Kong Interpretation 5 (2020)2
Amendments to HKAS 1 Non-current liabilities with Covenant2
Amendments to HKAS 7 and HKFRS 7 Supplier Finance Arrangements2
Amendments to HKAS 21 Lack of Exchangeability3

1 Effective for annual periods beginning on or after a date to be determined.

2 Effective for annual periods beginning on or 1 January 2024.
3 Effective for annual periods beginning on or 1 January 2025.

2.2 Consolidation

(a) Acquisition method of accounting for non-common control combination

The Group applies the acquisition method of accounting to account for business combinations other than
common control combinations. The purchase consideration for the acquisition of a subsidiary is the fair value
of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests
issued by the Group. The purchase consideration includes the fair value of any asset or liability resulting from a
contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiaries.
Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured initially at their fair values at the acquisition date,
which is the date on which control is obtained. On an acquisition-by-acquisition basis, the Group recognises any
non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share
of the recognised amounts of the acquiree’s identifiable net assets.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously
held equity interest in the acquiree is remeasured to fair value at the acquisition date; any gains or losses arising
from such remeasurement are recognised in profit or loss or other comprehensive income, as appropriate.

The excess of purchase consideration, the amount of any non-controlling interest in the acquiree and the
acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable
net assets acquired are recorded as goodwill. If the total of purchase consideration, non-controlling interest
recognised and previously held interest measured are less than the fair value of the net assets of the subsidiary
acquired in the case of a bargain purchase, the difference is recognised directly in the consolidated statement of
profit or loss.

(b) Subsidiaries

Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect
those returns through its power over the entity. The Group has power over an entity when it has existing rights
to direct the relevant activities that significantly affect the entity’s returns. The subsidiaries are fully consolidated
from the date on which control is transferred to the Group. They are deconsolidated from the date that control
ceases.

Inter-company transactions, balances, income and expenses on transactions between Group companies are
eliminated. Profits and losses resulting from inter-company transactions that are recognised in assets are also
eliminated. Accounting policies of subsidiaries are consistent with the policies adopted by the Group.

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(c) Transactions with non-controlling interests

Transactions with non-controlling interests that do not result in loss of control are accounted for as equity
transactions – that is, as transactions with the owners in their capacity as owners. The difference between
fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the
subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in
equity.

When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as
the difference between (i) the aggregate of the fair value of the consideration received and the fair value of
any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of
the subsidiary and any non-controlling interests. All amounts previously recognised in other comprehensive
income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets
or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as
specified/permitted by applicable HKFRSs). The fair value of any investment retained in the former subsidiary
at the date when the control is lost is regarded as the fair value on initial recognition for subsequent accounting
under HKFRS 9, when applicable, the cost on initial recognition of an investment in an associate or a joint
venture. When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value,
with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for
the purposes of subsequent accounting for the retained interest as an associate, joint arrangement or financial
asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity
are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehensive income are reclassified to profit or loss.

(d) Separate financial statements

Investments in subsidiaries are accounted for at cost less impairment. Cost is adjusted to reflect changes in
consideration arising from contingent consideration amendments. Cost also includes directly attributable costs
of the investment. The results of subsidiaries are accounted for by the investing Group entity on the basis of
dividend received and receivable.

2.3 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the Executive Committee of the Company.

2.4 Foreign currency translation

(a) Functional and presentation currency

Items included in the financial statements of each Group entity are measured using the currency of the primary
economic environment in which the entity operates (functional currency). The functional currency of the
Company is US dollars (US$), which is also the presentation currency of the Group.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at
the dates of the transactions or reporting date where monetary items are remeasured. Foreign exchange gains
and losses resulting from the settlement of such transactions and from the translation of monetary assets and
liabilities denominated in foreign currencies at year-end exchange rates are recognised in the consolidated
statement of profit or loss.

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Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates
prevailing on the date when the fair value was determined. When a fair value gain or loss on a non-monetary
item is recognised in profit or loss, any exchange component of that gain or loss is also recognised in profit or
loss. When a fair value gain or loss on a non-monetary item is recognised in other comprehensive income, any
exchange component of that gain or loss is also recognised in other comprehensive income. Non-monetary
items that are measured in terms of historical cost in a foreign currency are not retranslated.

2.5 Property, plant and equipment

Cost

Property, plant and equipment are stated at historical cost less accumulated depreciation and impairment losses,
if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items and costs
incurred in bringing the asset to the location and condition necessary for it to be capable of operating in the
manner intended by management, including costs of testing whether the related assets is functioning properly
and, for qualifying assets, borrowing costs capitalised in accordance with the Group’s accounting policy. Sale
proceeds of items that are produced while bringing an item of property, plant and equipment to the location and
condition necessary for it to be capable of operating in the manner intended by management (such as samples
produced when testing whether the asset is functioning properly), and the related costs of producing those
items are recognised in the profit or loss, if any. The cost of those items are measured in accordance with the
measurement requirements of HKAS 2. The cost of property, plant and equipment includes the estimated cost of
mine rehabilitation, restoration and dismantling.

Depreciation and amortisation

Property, plant and equipment are depreciated over the estimated useful lives of the assets on straight line, unit
of production or reducing balance basis as indicated below. The useful lives below are subject to the lesser of
the asset categories’ useful life and the life of the mine:

• Freehold land – Not depreciated or unit of production (tonnes mined) as applicable;

• Buildings – straight line over the useful life of the asset as applicable which do not exceed 40 years;
• Plant and machinery – Units-of-production (tonnes mined or milled) or straight line over the useful life of the
asset as applicable which does not exceed 20 years;
• Plant and machinery (other) – Straight line 2-15 years or reducing balance over remaining life;
• Mine property and development assets – Units-of-production (tonnes mined, milled, or metal produced);
• Exploration and evaluation assets – Not depreciated; and
• Construction in progress – Not depreciated.

Depreciation and amortisation commence when an asset is available for use.

The units-of-production method is applied based on assessments of proven and probable ore reserves and a
portion of mineral resources available to be mined or processed by the current production equipment to the
extent that such resources are considered to be economically recoverable. Resource and Reserves estimates are
reviewed annually.

(a) Exploration and evaluation assets

Exploration and evaluation activities include expenditure to identify potential Mineral Resources, determine the
technical feasibility and assess the commercial viability of the potential Mineral Resources.

Exploration and evaluation costs that are incurred before the Group has obtained the legal right to explore an
area, or are incurred up to and including the pre-feasibility phase, are recognised in the consolidated statement

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of profit or loss. Subsequent exploration and evaluation costs are capitalised as exploration and evaluation asset
where the relevant capitalisation criteria under the applicable standard is met.

Exploration and evaluation costs that relate to an area of interest acquired as part of an asset acquisition or
business combination are capitalised and the exploration and evaluation asset is measured at fair value on
acquisition.

Exploration and evaluation assets are recognised as tangible assets and classified under property, plant and
equipment. As these assets are not yet ready for use they are not depreciated.

Exploration and evaluation assets are carried forward if the rights to the area of interest are current and the
expenditures are expected to be recouped through successful development and exploitation of the area of
interest, or alternatively by the sale of the asset.

The assets are monitored for indications of impairment and an assessment is performed where an indicator of
impairment exists. For the purpose of the impairment testing, exploration and evaluation assets are allocated to
cash-generating units (“CGU”) to which the exploration activity relates.

Once the technical feasibility and commercial viability of the development of an area of interest are demonstrable,
exploration and evaluation assets attributable to that area of interest are first tested for impairment and then
reclassified to “mine property and development” assets within property, plant and equipment.

(b) Development expenditure

The following assets are classified directly as mine property and development assets from the commencement
of development:

• Mineral rights balances representing identifiable exploration and evaluation assets including Mineral Resources
and Ore Reserves acquired as part of a business combination and recognised at fair value at the date of
acquisition; and
• Mine rehabilitation, restoration and dismantling assets.

After the technical feasibility and commercial viability of the development of an area of interest are
demonstrated, all subsequent expenditure to develop the mine to the production phase is capitalised and
classified as “mine property and development” assets.

(c) Overburden and waste removal

Overburden and other waste removal costs incurred in the development phase of a mine before production
commences are initially capitalised as part of construction in progress. At the completion of development, costs
are transferred to the mine property and development category of property, plant and equipment.

The Group defers a portion of waste removal costs incurred during the production phase of an open-pit
operation as part of determining the cost of inventories. Current period waste mining expenses are allocated
between current period inventory and deferred waste assets based on the ratio of waste tonnes mined to
ore tonnes mined (waste to ore ratio). The amount of deferred waste asset is calculated for each separate
component of the ore body identified based on mine plans. Current period expenses are deferred to the extent
that the current period waste to ore ratio exceeds the life-of-mine waste to ore ratio for the identified component
of ore body. Deferred waste assets are categorised in the mine property and development category of property,
plant and equipment and are amortised over the life of the component on a units-of-production basis. Changes
to estimates are accounted for prospectively.

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(d) Other expenditure

When further development expenditure is incurred in respect of the mine property after the commencement of
the production phase, or additional property, plant and equipment are acquired, such expenditure is capitalised
and carried forward only when it is probable that future economic benefits associated with the item will flow to
the Group and the cost of the item can be measured reliably.

Major spare parts are carried as property, plant and equipment when an entity expects to use them during more
than one period or when they can be used only in connection with an item of property, plant and equipment. The
carrying amount of the replaced part is derecognised. All other repairs and maintenance are expensed in the
consolidated statement of profit or loss during the accounting period in which they are incurred.

(e) Disposal of property, plant and equipment

On disposal of an item of property, plant and equipment, the difference between the disposal proceeds and the
carrying amount of the asset is recognised as a gain or loss in the consolidated statement of profit or loss within
other income.

2.6 Intangible assets

(a) Goodwill

Goodwill arises on the acquisition of subsidiaries and represents the excess of the purchase consideration over
the interest of the Group in the fair value of the identifiable assets, liabilities and contingent liabilities of the
acquiree and the non-controlling interest in the acquiree.

Goodwill is not amortised and is tested for impairment annually (refer to Note 2.7). For the purpose of impairment
testing, goodwill acquired in a business combination is allocated to each of the CGUs, or groups of CGUs,
that is expected to benefit from the synergies of the acquisition. Each unit or group of units to which the
goodwill is allocated, represents the lowest level within the entity at which the goodwill is monitored for internal
management purposes. Goodwill is monitored at the operating segment level.

(b) Software development

Development costs that are directly attributable to the design, testing and deployment of identifiable and unique
software products controlled by the Group are recognised as intangible assets when the following criteria are met:

• It is technically feasible to complete the software product so that it will be available for use;
• Management intends to complete the software product and use or sell it;
• There is an ability to use or sell the software product;
• It can be demonstrated how the software product will generate probable future economic benefits;
• Adequate technical, financial and other resources to complete the development and to use or sell the software
product are available; and
• The expenditure attributable to the software product during its development can be reliably measured.

Directly attributable costs include direct materials, employee costs, services and an appropriate portion of
relevant overheads.

Other development expenditure that does not meet these criteria and costs associated with maintaining
computer software programs is recognised as an expense as incurred. Development costs previously recognised
as an expense are not recognised as an asset in a subsequent period.

Software development assets are amortised over their estimated useful lives, which do not exceed seven years.

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2.7 Impairment of non-financial assets

All intangible assets that have an indefinite useful life, for example goodwill, or are not ready for use are tested
annually for impairment or more frequently if events or changes in circumstances indicate a potential impairment.

Other non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable.

An impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its
recoverable amount. The recoverable amount is the higher of the fair value less costs of disposal and value in
use of an asset. For the purposes of impairment assessment, assets are grouped at the lowest levels for which
there are separately identifiable cash flows.

Any impairment loss related to goodwill is recognised immediately as an expense and is not subsequently reversed.
Any impairment loss related to non-financial assets other than goodwill is reviewed and may be reversed at
subsequent reporting dates. A reversal of previously recognised impairment loss is limited to the lesser of the
amount that would not cause the carrying amount to exceed its recoverable amount or the carrying amount that
would have been determined (net of accumulated depreciation) had no impairment loss been recognised.

2.8 Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a
period of time in exchange for consideration.

For contracts entered into or modified on or after the date of initial application or arising from business
combinations, the Group assesses whether a contract is or contains a lease based on the definition under HKFRS
16 at inception, modification date or acquisition date, as appropriate. Such contract will not be reassessed unless
the terms and conditions of the contract are subsequently changed.

For a contract that contains a lease component and one or more additional lease or non-lease components, the
Group allocates the consideration in the contract to each lease component on the basis of the relative stand-
alone price of the lease component and the aggregate stand-alone price of the non-lease components.

The Group applies the short-term lease recognition exemption to leases that have a lease term of 12 months
or less from the commencement date and do not contain a purchase option. It also applies the recognition
exemption for lease of low-value assets. Lease payments on short-term leases and leases of low-value assets
are recognised as an expense on a straight-line basis over the lease term.

(a) Right-of-use assets

Except for short-term leases and leases of low value assets, the Group recognises right-of-use assets at
the commencement date of the lease (i.e. the date the underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities.

The cost of right-of-use assets includes:

• the amount of the initial measurement of the lease liability;

• any lease payments made at or before the commencement date, less any lease incentives received;
• any initial direct costs incurred by the Group; and
• an estimate of costs to be incurred by the Group in dismantling and removing the underlying assets, restoring
the site on which it is located or restoring the underlying asset to the condition required by the terms and
conditions of the lease.

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Right-of-use assets in which the Group are reasonably certain to obtain ownership of the underlying leased
assets at the end of the lease term are depreciated from commencement date to the end of the useful life.
Otherwise, right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful
life and the lease term. The Group presents right-of-use assets as a separate line item on the consolidated
statement of financial position.

(b) Lease liabilities

At the commencement date of a lease, the Group recognises and measures the lease liability at the present
value of lease payments that are unpaid at that date. In calculating the present value of lease payments, the
Group uses the incremental borrowing rate (“IBR”) at the lease commencement date if the interest rate implicit
in the lease is not readily determinable.

The lease payments include:

• fixed payments (including in-substance fixed payments) less any lease incentives receivable;
• variable lease payments that depend on an index or a rate;
• amounts expected to be paid under residual value guarantees;
• the exercise price of a purchase option reasonably certain to be exercised by the Group; and
• payments of penalties for terminating a lease, if the lease term reflects the Group exercising the option
to terminate.

Variable lease payments that reflect changes in market rental rates are initially measured using the market rental
rates at the commencement date. Variable lease payments that do not depend on an index or a rate are not
included in the measurement of lease liabilities and right-of-use assets and are recognised as expense in the
period on which the event or condition that triggers the payment occurs.

After the commencement date, lease liabilities are adjusted by interest accretion and lease payments. The Group
remeasures lease liabilities (and makes a corresponding adjustment to the related right-of-use assets) whenever:

• the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which
case the related lease liability is remeasured by discounting the revised lease payments using a revised
discount rate at the date of reassessment.
• the lease payments change due to changes in rental rates, in which case the related lease liability is
remeasured by discounting the revised lease payments using the initial discount rate.

(c) Lease modifications

The Group is allowed to apply the practical expedient, the Group accounts for a lease modification as a separate
lease if:

• the modification increases the scope of the lease by adding the right to use one or more underlying assets; and
• the consideration for the leases increases by an amount commensurate with the stand-alone price for the
increase in scope and any appropriate adjustments to that stand-alone price to reflect the circumstances of
the particular contract.

For a lease modification that is not accounted for as a separate lease, the Group remeasures the lease liability
based on the lease term of the modified lease by discounting the revised lease payments using a revised
discount rate at the effective date of the modification.

The Group accounts for the remeasurement of lease liabilities by making corresponding adjustments to the
relevant right-of-use asset. When the modified contract contains a lease component and one or more additional

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lease or non-lease components, the Group allocates the consideration in the modified contract to each lease
component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone
price of the non-lease components.

2.9 Financial assets

Classification

Classification of financial assets depends on the Group’s business model for managing its financial assets and
the contractual terms of the cash flows. The Group classifies its financial assets as:

• financial assets measured at amortised cost, or

• financial assets measured at fair value.

Gains or losses of assets measured at fair value will be recognised either through profit or loss (“FVTPL”) or
through other comprehensive income.

(a) Amortised cost

A financial asset shall be measured at amortised cost if it is held within a business model. The objective of which
is to hold financial assets in order to collect contractual cash flows, where the contractual terms of the financial
asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.

(b) Financial assets at fair value through profit or loss (FVTPL)

A financial asset shall be measured at FVTPL unless it is measured at amortised cost or at fair value through
other comprehensive income.

Recognition and measurements

Regular purchases and sales of financial assets are recognised on the trade-date being the date on which the
Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction
costs for all financial assets not carried at FVTPL. Financial assets carried at FVTPL are initially recognised at fair
value and transaction costs are expensed in the consolidated statement of profit or loss.

Financial assets at FVTPL are subsequently carried at fair value. Financial assets at amortised cost are measured
at the amount recorded at initial recognition minus the principal repayments, plus or minus the cumulative
amortisation using the effective interest method of any difference between that initial amount and the maturity
amount and adjusted for any loss allowance.

Gains or losses arising from changes in the fair value of the financial assets at FVTPL are presented in the
consolidated statement of profit or loss within expenses in the period in which they arise. The net gain or loss
recognised in profit or loss arising from changes in the fair value of the financial assets at FVTPL excludes any
dividend income. Dividend income from financial assets at FVTPL is recognised in the consolidated statement of
profit or loss as part of other income when the right of the Group to receive payment is established, the Group is
probable to obtain the economic benefits associated with it and the amount can be measured reliably.

Financial assets are derecognised when the contractual rights to receive cash flows from the investments have
expired or have been transferred, and the Group has transferred substantially all risks and rewards of ownership
of the asset to another entity. On derecognition of a financial asset measured at amortised cost, the difference
between the asset’s carrying amount and the sum of the consideration received and receivable is recognised in
profit or loss.

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Impairment of financial assets

The Group applies an expected credit loss (“ECL”) approach in respect of receivables classified as financial
assets at amortised cost, which is assessed on an individual basis for each counterparty at the end of each
reporting period where relevant. The Group reviews credit risk with respect to the counterparty, likelihood or risk
of default and forward-looking reasonable and supportable documentation in assessing a loss allowance for the
respective financial asset at the end of each reporting period. The Group’s consideration of credit risk takes into
account, among other things, the instrument type, credit risk rating, date of initial recognition, remaining term to
maturity and geographical location of the debtor. A financial asset is credit-impaired when one or more events
that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. Credit
loss is measured at the present value of such difference in cash flows, discounted using the effective interest
rate determined at initial recognition. The Group measures the loss allowance equal to 12-month ECL (“12m
ECL”). In the event when there has been a significant increase in credit risk since initial recognition, the Group
recognises lifetime ECL. The Group writes off a financial asset when there is information indicating that the
counterparty is in severe financial difficulty and there is no realistic prospect of recovery.

(c) Derivative financial instruments and hedge accounting

For the year ended 31 December 2023, the Group has held derivative financial instruments, all of which have
been detailed in Note 31.1 (a) and Note 31.1 (b). Derivatives are initially recognised at fair value at the date when
derivative contracts are entered into and are subsequently remeasured to their fair value at the end of the
reporting period. The resulting gain or loss is recognised in profit or loss unless the derivative is designated and
effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the
nature of the hedge relationship.

A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the
instrument is more than 12 months and it is not due to be realised or settled within 12 months. Other derivatives
are presented as current assets or current liabilities.

The Group designates certain derivatives as hedging instruments for cash flow hedges.

At the inception of the hedging relationship the Group documents the relationship between the hedging
instrument and the hedged item, along with its risk management objectives and its strategy for undertaking the
hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents
whether the hedging instrument is effective in offsetting changes in cash flows of the hedged item attributable
to the hedged risk.

Assessment of hedging relationship and effectiveness

For hedge effectiveness assessment, the Group considers whether the hedging instrument is effective in
offsetting changes in cash flows of the hedged item attributable to the hedged risk, which is when the hedging
relationships meet all of the following hedge effectiveness requirements:

• there is an economic relationship between the hedged item and the hedging instrument;
• the effect of credit risk does not dominate the value changes that result from that economic relationship; and
• the hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item
that the Group actually hedges and the quantity of the hedging instrument that the entity actually uses to
hedge that quantity of hedged item.

In assessing the economic relationship between the hedged item and the hedging instrument the Group
assumes that the interest rate benchmark on which the hedged cash flows and/or hedged risk are based, or the
interest rate benchmark on which the cash flows of the hedging instrument are based, is not altered as a result
of interest rate benchmark reform.

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The effective portion of changes in the fair value of the hedging instrument designated as cash flow hedges is
recognised in other comprehensive income and accumulated under the heading of cash flow hedge reserve,
limited to the cumulative change in fair value of the hedged item from inception of the hedge. When a hedged
item in a cash flow hedge is amended to reflect the changes that are required by the interest rate benchmark
reform, the amount accumulated in the cash flow hedge reserve is deemed to be based on the alternative
benchmark rate on which the hedged future cash flows are determined. The gain or loss relating to the
ineffective portion is recognised immediately in profit or loss, and is included in the ‘finance income’ or ‘finance
costs’ line item for a financing hedge (e.g., an interest rate swap) or in ‘other income/expense’ (for any other
hedges, e.g., a commodity hedge). As to cash flow statements disclosure, cashflow resulting from commodity
hedge is part of ‘operating activities’; cashflow resulting from financing hedge (e.g., an interest rate swap) is part
of ‘financing activities’.

Discontinuation of hedge accounting

The Group discontinues hedge accounting prospectively only when the hedging relationship (or a part thereof)
ceases to meet the qualifying criteria (after rebalancing, if applicable). This includes instances when the
hedging instrument expires or is sold, terminated or exercised. Discontinuing hedge accounting can either
affect a hedging relationship in its entirety or only a part of it (in which case hedge accounting continues for the
remainder of the hedging relationship).

For cash flow hedge, any gain or loss recognised in other comprehensive income and accumulated in equity at
that time remains in equity and is recognised when the forecast transactions is ultimately recognised in profit
or loss. When a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is
recognised immediately in profit or loss.

2.10 Financial guarantee contract

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the
holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the
original or modified terms of a debt instrument.

For a financial guarantee contract, the Group is required to make payments only in the event of a default by the
debtor in accordance with the terms of the instrument that is guaranteed. Accordingly, the expected loss is the
present value of the expected payments to reimburse the holder for a credit loss that it incurs less any amounts
that the Group expects to receive from the holder, the debtor or any other party.

For ECL on financial guarantee contracts for which the effective interest rate cannot be determined, the Group
will apply a discount rate that reflects the current market assessment of the time value of money and the risks
that are specific to the cash flows but only if, and to the extent that, the risks are taken into account by adjusting
the discount rate instead of adjusting the cash shortfalls being discounted.

For financial guarantee contracts, the loss allowances are recognised at the higher of the amount of the loss
allowance determined in accordance with HKFRS 9; and the amount initially recognised less, where appropriate,
cumulative amount of income recognised over the guarantee period.

2.11 Inventories

Inventories comprise raw materials, stores and consumables, work in progress and finished goods. Inventories
are stated at the lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of
completion and costs necessary to make the sale. Costs necessary to make the sale include incremental costs
directly attributable to the sale and non-incremental costs which the Group must incur to make the sale.

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Costs are assigned to individual items of inventory based on weighted average costs. Costs include the costs of
direct materials, overburden removal, mining, processing, labour, related transportation costs to the point of sale,
an appropriate proportion of related production overheads, mine rehabilitation costs incurred in the extraction
process and other fixed and variable costs directly related to mining activities. They exclude borrowings costs.

2.12 Trade and other receivables

Trade receivables are recognised initially at transaction price and subsequently measured at fair value through
profit or loss. The terms of sales contracts with third parties contain provisional pricing arrangements whereby
the selling price for contained metal is based on prevailing spot prices during a specified future date range after
shipment to the customer (quotation period). For provisional pricing arrangements, the Group re-estimates the
fair value of the final sales price adjustment continually by reference to forward market prices. The fair value of
the final sales price is recognised as an adjustment to revenue. Refer to Note 2.20 for details.

Other receivables are measured at amortised cost using the effective interest method, less provision for
impairment. If collection of trade and other receivables is expected in one year or less, trade and other
receivables are classified as current assets. If not, they are presented as non-current assets.

2.13 Cash and cash equivalents

Cash and cash equivalents presented on the consolidated statement of financial position include:

• cash, which comprises of cash on hand and deposits held at call with banks, excluding bank balances that are
subject to regulatory restrictions that result in such balances no longer meeting the definition of cash; and
• cash equivalents, which comprises of short-term highly liquid investments with original maturities of three
months or less. Cash equivalents are held for the purpose of meeting short-term cash commitments rather
than for investment or other purposes.

For the purposes of the consolidated statement of cash flows, cash and cash equivalents consist of cash and
cash equivalents as defined above, net of outstanding bank overdrafts which are repayable on demand and form
an integral part of the Group’s cash management. Such overdrafts are presented as short-term borrowings in the
consolidated statement of financial position.

2.14 Financial liabilities and equity

Financial liabilities and equity instruments issued by the Group are classified according to the substance of the
contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

(a) Financial liabilities

Financial liabilities are initially measured at fair value, and are subsequently measured at amortised cost, using
the effective interest method. The Group derecognises financial liabilities when, and only when, the Group’s
obligations are discharged, cancelled or have expired. The difference between the carrying amount of the
financial liability derecognised and the consideration paid and payable is recognised in profit or loss.

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently
stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption
value is recognised in the consolidated statement of profit or loss over the period of the borrowings using the
effective interest method.

Borrowings are classified as current unless the Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date.

General and specific borrowing costs directly attributable to the acquisition, construction or production of
qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their

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intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready
for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

(b) Equity instruments

Equity instruments are any contract that evidences a residual interest in the assets of the Group after deducting
all of its liabilities. Subsequent to initial recognition, the equity instrument is not remeasured. Ordinary shares are
classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.

(c) Foreign exchange gains and losses

For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the end
of each reporting period, the foreign exchange gains and losses are determined based on the amortised cost of
the instruments. These foreign exchange gains and losses are recognised in the ‘Expenses’ line item in profit or
loss (Note 6) as part of net foreign exchange loss/(gain) - net.

2.15 Mine rehabilitation, restoration and dismantling obligations

Provisions are made for the estimated cost of rehabilitation, restoration and dismantling relating to areas
disturbed during the mine’s operations up to the reporting date but not yet rehabilitated. Provision has been
made in full for all the disturbed areas at the reporting date based on current estimates of costs to rehabilitate
such areas, discounted to their present value based on expected future cash flows. The estimated cost
of rehabilitation includes the current cost of recontouring, top soiling and revegetation to meet legislative
requirements. Changes in estimates are dealt with on a prospective basis as they arise.

Uncertainty exists as to the amount of rehabilitation obligations that will be incurred due to the impact of
changes in environmental legislation, and many other factors, including future developments, changes in
technology, price increases and changes in interest rates. The amount of the provision relating to mine
rehabilitation, restoration and dismantling obligations is recognised at the commencement of the mining project
and/or construction of the assets where a legal or constructive obligation exists at that time.

The provision is recognised as a liability, separated into current (estimated expenditure arising within 12 months)
and non-current components, based on the expected timing of these cash flows. A corresponding asset is
included in mine property and development assets, only to the extent that it is probable that future economic
benefits associated with the restoration expenditure will flow to the entity, otherwise a corresponding expense is
recognised in the profit or loss. The capitalised cost of this asset is recognised in property, plant and equipment
and is amortised over the life of the mine.

At each reporting date, the rehabilitation liability is remeasured in line with changes in discount rates, and timing
or amounts of the costs to be incurred. Rehabilitation, restoration and dismantling provisions are adjusted for
changes in estimates. Adjustments to the estimated amount and timing of future rehabilitation and restoration
cash flows are a normal occurrence considering the significant judgements and estimates involved. Changes
in the liability relating to mine rehabilitation, restoration and dismantling obligations are added to or deducted
from the related asset (where it is probable that future economic benefits will flow to the entity), other than the
unwinding of discount on provisions, which is recognised as a finance cost in the consolidated statement of
profit or loss. Changes to capitalised cost result in an adjustment to future depreciation charges.

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The provisions referred to above do not include any amounts related to remediation costs associated with
unforeseen circumstances.

2.16 Provisions and contingent liabilities

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past
events, it is probable that an outflow of resources will be required to settle the obligation, and the amount has
been reliably estimated.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is
determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of
an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation
using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to
the obligation. The increase in the provision due to the passage of time is recognised as an interest expense.

A provision for onerous contracts is recognised when the expected benefits to be derived by the Group from
a contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is
measured at the present value of the lower of the expected cost of terminating the contract and the expected
net cost of continuing with the contract.

A provision is recognised for the amount expected to be paid under short-term or long-term bonus entitlements
if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided
by the Director or employee and the obligation can be estimated reliably.

A contingent liability is a present obligation arising from past events but is not recognised because it is not
probable that an outflow of resources embodying economic benefits will be required to settle the obligation or
the amount of the obligation cannot be measured with sufficient reliability.

The Group assesses continually to determine whether an outflow of resources embodying economic benefits has
become probable. If it becomes probable that an outflow of future economic benefits will be required for an item
previously dealt with as a contingent liability, a provision is recognised in the consolidated financial statements
in the reporting period in which the change in probability occurs, except in the limited circumstances where no
reliable estimate can be made.

2.17 Current and deferred income tax

The tax expense recognised for the year comprises current and deferred tax. Tax is recognised in the
consolidated statement of profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.

The current income tax expense represents the sum of current and deferred income tax expense.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the
reporting date in the jurisdictions or where a stability agreement is applicable where the Company’s subsidiaries
operate and generate taxable income. Management periodically evaluates positions taken in tax returns with
respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is recognised on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax is
not accounted for if it arises from initial recognition of an asset or a liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or loss and at the

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time of the transaction does not give rise to equal taxable and deductible temporary differences. Deferred
income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the
reporting date or where a stability agreement is applicable and are expected to apply when the related deferred
income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be
available against which the temporary differences can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries, except where
the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the
temporary difference will not reverse in the foreseeable future.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current
tax assets against current tax liabilities, and when the deferred income tax assets and liabilities relate to income
taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where
there is an intention and agreement with tax authorities to settle the balances on a net basis.

Tax consolidation – Australia

The majority of the Australian subsidiaries of the Company are an income tax consolidated group and are taxed
as a single entity. MMG Australia Limited is the head company of the Australian tax consolidated group.

The subsidiaries in the Australian tax consolidated group account for their own current and deferred tax
amounts. These tax amounts are measured as if each entity in the tax consolidated group continues to be a
stand-alone tax payer in its own right. In addition to its own current and deferred tax amounts, the head entity
recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and
unused tax credits assumed from the other entities in the tax consolidated group.

Assets or liabilities arising under tax funding agreements between entities within the tax consolidated group
entities are utilised as amounts receivable from or payable to other entities within the tax consolidated group.

2.18 Trade and other payables

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost
using the effective interest method.

Trade and other payables are classified as current liabilities if payment is due within one year or less. If not, they
are presented as non-current liabilities.

2.19 Employee benefits

(a) Employee leave entitlements

Employee entitlements to annual leave are recognised when they are accrued by employees. A provision is made
for the estimated liability for annual leave as a result of services rendered by employees up to the reporting date.
Employee entitlements to sick leave and maternity leave are not recognised until the time of leave.

(b) Pension obligations – defined contribution plans

Arrangements for staff retirement benefits are made in accordance with local regulations and customs.

For defined contribution plans, the Group pays contributions to publicly or privately administered pension
insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations
once the contributions have been paid. The contributions are recognised as an employee benefit expense when
they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in
future payment is available.

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(c) Long-term employee benefits

Long-term employee benefit obligations are measured at the present value of expected future payments to be
made. Long-term benefits include post-employment defined benefit plan in Democratic Republic of the Congo
(“DRC”) and long service leave in Australia.

Post-employment defined benefit plan

Defined benefit obligation under the plan is measured at the present value of expected future payments to be
made in respect of services provided by employees up to the end of the reporting period using the projected unit
credit method and recorded as non-current liabilities. In determining the present value of the Group’s defined
benefit obligations and the related current service cost and, where applicable, past service cost, the Group
attributes benefit to periods of service under the plan’s benefit formula. However, if an employee’s service in
later years will lead to a materially higher level of benefit than earlier years, the Group attributes the benefit on a
straight-line basis from:

• the date when service by the employee first leads to benefits under the plan (whether or not the benefits are
conditional on further service) until
• the date when further service by the employee will lead to no material amount of further benefits under the
plan, other than from further salary increases.

Consideration is given to expected future salary increase and historic attrition rates. Expected future payments
are discounted using market yields at the reporting date on national government bonds with terms to maturity
and currency that match, as closely as possible, the estimated future cash outflows. Remeasurement, comprising
actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan
assets (excluding interest), is reflected immediately in the consolidated statement of financial position with a
charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement
recognised in other comprehensive income is reflected immediately in retained earnings and will not be
reclassified to profit or loss. Changes in the present value of the defined benefit obligation resulting from plan
amendments are recognised as past service costs. Current and past service costs related to post-employment
benefits are recognised immediately in the consolidated statement of profit and loss while unwinding of the
liability at discount rates used are recorded as financial cost.

Long service leave

Long service leave is a period of paid leave granted to an employee in recognition of a long period of service
to an employer. The liability for long service leave is recognised in the provision for employee benefits and
measured as the present value of expected future payments to be made. Consideration is given to expected
future wage and salary levels, experience of employee departures and periods of service. Expected future
payments are discounted using market yields at the reporting date on national government bonds with terms to
maturity and currency that match, as closely as possible, the estimated future cash outflows. The Group applies
simplified method of accounting as required by HKAS 19 Employee Benefits and all past service costs and
actuarial gains and losses (where applicable) are recognised immediately.

(d) Share-based compensation to employees

The Group operates multiple equity-settled and cash-settled, share-based compensation plans, under which
the entity receives services from employees as consideration for equity instruments of the Group. The fair value
of the employee services received in exchange for the grant of the options or performance shares or cash
awards is recognised as an expense. The total amount to be expensed over the vesting period is determined by
reference to the fair value of the options/performance shares granted, excluding the impact of any non-market
service and performance vesting conditions (for example, profitability and remaining employees of the entity over

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a specified period). Non-market vesting conditions are included in assumptions about the number of options/
performance shares that are expected to vest. The total amount expensed is recognised over the vesting period,
which is the period over which all of the specified vesting conditions are to be satisfied. At each reporting date,
the Group revises its estimates of the number of options/performance shares that are expected to vest based
on the non-market vesting conditions. For cash-settled share-based compensation plans, at the end of each
reporting period until the provision is settled , and at the date of settlement, the provision is remeasure to fair
value. For cash awards that are vested, any changes in the fair value are recognised in profit or loss for the year.
It recognises the impact of the revision of original estimates, if any, in the consolidated statement of profit or loss
with a corresponding adjustment to equity or provision.

The proceeds received net of any directly attributable transaction costs are credited to share capital or paid by
cash when the options are exercised. Options which lapse or are cancelled prior to their exercisable date are
deleted from the register of outstanding options and the amount previously recognised in share-based payment
reserve or liability will be transferred to retained profits.

2.20 Revenue recognition

Revenue is recognised when persuasive evidence of an arrangement exists, usually in the form of an executed
sales agreement, indicating there has been a transfer of control and completion of distinctive performance
obligations separately identified by the Group. Factors which indicate transfer of control include, but are not
limited to, transfer of risk and reward, transfer of legal title to customer and a present right to payment.

Transaction price under the sales agreement is allocated to the various performance obligations under the
relevant sales agreement and revenue is recognised in line with satisfaction of each performance obligation.

Revenue is presented net of value-added tax, returns, rebates and discounts and after eliminating sales within
the Group.

(a) Sale of goods

Sale of goods is recognised upon transfer of control, which for majority of the products is the bill of lading date
when the commodity is delivered for shipment, or in case of bill-and-hold arrangements, once a holding and
title certificate is issued to the buyer together with the invoice. Depending on various incoterms associated with
the sales agreement, the Group may have other performance obligations such as shipping service. Revenue
may be allocated to various performance obligations and is recognised for each performance obligation as such
obligations are fulfilled. Allocation of transaction price to other performance obligations (e.g. shipping services) is
based on best estimate of a similar stand-alone service.

Revenue is reported net of discounts and pricing adjustments. Royalties paid and payable are separately
reported as expenses. Revenues from the sale of significant by-products, such as gold and silver, are included in
sales revenue.

Price adjustments in case of provisionally priced sales

The Group has certain provisionally priced sales where the contract terms for the Group’s concentrate sales
allow for adjustment based on a final assay of the goods determined after discharge. The Group assesses such
provisional pricing to be a variable consideration and recognises revenue at an amount representing the Group’s
estimate for the expected final consideration. This amount is based on the most recently determined estimate of
product assays. The Group applies judgement regarding likelihood of significant reversals to ensure that revenue
is only recognised to the extent that it is highly probable that significant reversal will not occur. Any adjustments
to the final price are recognised as revenue.

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Changes in fair value of provisionally priced sales

The terms of sales contracts with third parties contain provisional pricing arrangements whereby the initial
selling price (provisional price) for contained metal is based on prevailing spot prices before the shipment to
the customer (provisional quotational period). Adjustment to the provisional price occurs based on movements
in quoted market prices up to the completion of a specific future date range (quotational period). The period
between provisional invoicing and quotational period completion is typically between 0 and 120 days.

In case of such provisional pricing arrangements, the Group re-estimates the fair value of the final sales price
adjustment continually by reference to forward market prices. The fair value of the final sales price is recognised
as an adjustment to revenue.

Payment from customers is due within 2-30 working days of receiving the provisional invoicing and any
adjustments as per the final invoice are payable in 2-30 working days.

(b) Interest and dividend income

Interest income is recognised on a time-proportion basis, using the effective interest method. Dividend income is
recognised when right to receive dividend is established.

2.21 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s and the Company’s
financial statements in the period in which the dividends are approved by the Company’s Shareholders or the
Board, as appropriate.

3. Critical Accounting Estimates and Judgements

In preparing these consolidated financial statements, management has made estimates and judgements that
affect the application of the Group’s accounting policies. Estimates and judgements are reviewed on an ongoing
basis based on historical experience and other factors, including expectations of future events that are believed
to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by
definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are
discussed below.

3.1 Estimates

(a) Mine rehabilitation, restoration and dismantling obligations

Provision is made for the anticipated costs of future restoration, rehabilitation and dismantling of mining areas
from which natural resources have been extracted in accordance with the accounting policy in Note 2.15.
These provisions include future cost estimates associated with reclamation, plant closures, waste site closures,
monitoring, demolition, decontamination, water purification and permanent storage of historical residues.
These future cost estimates are discounted to their present value. The calculation of these provision estimates
require assumptions such as the application of environmental legislation, the scope and timing of planned
activities, available technologies, engineering cost estimates, inflation, and discount rates. A change in any of
the assumptions used may have a material impact on the carrying value of mine rehabilitation, restoration and
dismantling provisions. For non-operating sites, changes to estimated costs are recognised immediately in the
consolidated statement of profit or loss.

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Continued

(b) Mineral Resources and Ore Reserves estimates

The estimated quantities of economically recoverable Mineral Resources and Ore Reserves are based upon
interpretations of geological and geophysical models and require assumptions to be made regarding factors such
as estimates of short and long-term exchange rates, estimates of short and long-term commodity prices, future
capital requirements and future operating performance. Changes in reported Reserves and Resources estimates
can impact the carrying value of property, plant and equipment through depreciation, restoration and dismantling
obligations at the end of mine life, the recognition of deferred tax assets, as well as the amount of depreciation
and amortisation charged to the consolidated statement of profit or loss. The changes are effective from next
financial year following Board approval of the revised Reserves and Resources estimates.

(c) Inventory valuation

Accounting for inventory involves the use of estimates. Such estimates include determination of the net
realisable value of inventory (refer Note 2.11). Net realisable value is estimated based on expected selling price
in the ordinary course of business, less estimated costs of completion and costs necessary to make the sale.
Management utilises the mine plan of the respective operations in order to estimate the net realisable value.
Where the net realisable value is lower than the cost of inventory, the inventory value is reduced to reflect such
difference. In particular, the lower grade ore inventory is generally susceptible to such value reduction. A change
in assumptions may result in the net realisable value estimate to vary significantly, thereby impacting the overall
inventory valuation.

(d) Recoverability of non-financial assets

The recoverable amount of each of the Group’s cash-generating units is determined as the higher of the asset’s
fair value less costs of disposal and its value in use in accordance with the accounting policy in Notes 2.7 and
12. These calculations require the use of estimates and assumptions including discount rates, exchange rates,
commodity prices, exploration potential, future capital requirements and future operating performance.

(e) Deferral of waste removal costs

The Group defers a portion of waste removal costs incurred during the production phase of an open-pit
operation as part of determining the cost of inventories. The amount of deferred waste asset is calculated for
each separate component of the ore body as identified by management based on mine plans.

(f) Depreciation and amortisation

The Group allocates the depreciable amount of assets on a systematic basis over the relevant asset’s useful life.
Refer to Note 2.5 where depreciation methods and useful life estimates for major classes of assets has been
disclosed. The estimation of the useful life of the asset is a matter of management judgement and changes in
such estimation can result in material impact to the current and future depreciation and amortisation expenses.
As per Group’s policy, the depreciation method is re-assessed periodically and changes are made where
management believes that such changes in depreciation method or useful life estimate are required to better
reflect the pattern of consumption of economic benefits embodied in the asset.

Change in estimate during the year:

Management reassessed and amended the useful life and depreciation method for certain assets at Las Bambas
based on expected usage as per latest operational plans.

The change has resulted in depreciation for the year to be lower by US$15.2 million. Management believes the
amended useful lives and depreciation method better reflect the pattern of future economic benefits to be
obtained from the impacted assets.

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Continued

3.2 Judgements

(a) Taxes

The Group is subject to tax in a number of jurisdictions. Some of these are in countries that carry higher levels of
sovereign risk. Management continually assesses the levels of sovereign risk in determining whether political and
administrative changes and reforms in laws, regulations or taxation may impact the Group’s future performance.

Significant judgement is required in determining the tax position and the estimates and assumptions in relation
to the provision for taxes and the recovery of tax assets, having regard to the nature and timing of their
origination and compliance with the relevant tax legislation. There are some tax matters for which the ultimate
tax determination is uncertain during the ordinary course of business, which could have a significant impact
on the Group. Where the final outcome of pending tax matters is different from the amounts that were initially
recognised, such differences will impact the balances in the accounting period in which such determination is
made. Also refer to Note 35 in respect of tax matters with uncertain outcomes, which could result in further
claims in future against the Group.

A number of above-mentioned tax matters exist at Las Bambas which is also currently subject to multiple audits
and reviews by the Peruvian taxation authority in relation to value added taxes (“VAT”), withholding taxes and
income taxes. Some of these tax matters relate to Glencore plc’s period of ownership and may be subject to
potential indemnity claims. At 31 December 2023, the Group had certain indemnity claims in court against
Glencore plc and its subsidiaries (“Glencore”). These matters remain ongoing in the judicial process.

For some of the tax matters under audit in Peru, Minera Las Bambas S.A (“MLB”) may appeal and not pay the
assessed amount if unfavourable assessment resolutions were ultimately issued, or make judgements as to
the timing of payments in relation to these matters. The timing of resolution and potential economic outflow of
the unresolved tax matters are uncertain. Some of these uncertain tax matters are either incapable of being
measured reliably or there is remote possibility of economic outflow at the reporting date. As such, no provision
has been reflected in the consolidated financial statements for those tax matters.

Where income tax, VAT and withholding tax obligations have been assessed and deemed to have probable future
economic outflows capable of reliable measurement, the Group has recognised a provision for these.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable profits will be available to utilise those temporary differences and losses, and the
tax losses continue to be available having regard to the nature and timing of their origination and compliance
with the relevant tax legislation associated with their recoupment.

(b) Leases

Certain contracts require management to exercise judgement in applying HKFRS 16 requirements to determine
whether an identified asset exists for which the Group utilises substantially all the economic benefits and
whether the Group may have a right to use or direct use of that asset. Management conclusion as to whether
a lease component exists or not in any given contract may thus be subjective.

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Continued

4. Segment Information
HKFRS 8 “Operating Segments” requires operating segments to be identified on the basis of internal reports
about operations of the Group that are regularly reviewed by the chief operating decision-maker (“CODM”) in
order to allocate resources to the segment and assess its performance.

The Company’s Executive Committee has been identified as the CODM. The Executive Committee reviews the
Group’s internal reporting of these operations in order to assess performance and allocate resources.

The Group’s reportable segments are as follows:

Las Bambas The Las Bambas mine is a large open-pit, scalable, long-life copper and molybdenum mining
operation with prospective exploration options. It is located in the Cotabambas, Apurimac
region of Peru.
Kinsevere Kinsevere is an open-pit copper mining operation located in the Haut-Katanga Province of
the DRC.
Dugald River The Dugald River mine is an underground zinc mining operation located near Cloncurry in
North West Queensland.
Rosebery Rosebery is an underground polymetallic base metal mining operation located on Tasmania’s
west coast.
Other Includes corporate entities in the Group.

A segment result represents the EBIT by each segment. This is the measure reported to the CODM for the
purposes of resource allocation and assessment of segment performance. Other information provided, except
as disclosed in the following paragraph, to the CODM is measured in a manner consistent with that in these
consolidated financial statements.

Segment assets exclude current income tax assets, deferred income tax assets and net inter-segment
receivables. Segment liabilities exclude current income tax liabilities, deferred income tax liabilities and net
inter-segment loans. The excluded assets and liabilities are presented as part of the reconciliation to total
consolidated assets or liabilities.

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Continued

The segment revenue and results for the year ended 31 December 2023 are as follows:

For the year ended 31 December 2023

Other
unallocated
Dugald items/
US$ million Las Bambas Kinsevere River Rosebery eliminations Group
Revenue by metal:
- Copper1 2,938.0 354.63 - 8.2 3.4 3,304.2
- Zinc 2
- - 264.1 95.3 - 359.4
- Lead - - 35.9 32.0 - 67.9
- Gold 180.8 - - 52.7 - 233.5
- Silver 122.7 - 31.2 51.8 - 205.7
- Molybdenum 175.8 - - - - 175.8
Revenue from contracts with customers 3,417.3 354.6 331.2 240.0 3.4 4,346.5

EBITDA 1,396.7 (32.0) 33.8 77.8 (14.4) 1,461.9

Depreciation and amortisation expenses (Note 6) (800.0) (27.5) (53.1) (56.8) 7.2 (930.2)
EBIT 596.7 (59.5) (19.3) 21.0 (7.2) 531.7
Finance income (Note 7) 24.3
Finance costs (Note 7) (366.4)
Income tax expense (Note 8) (67.5)
Profit for the year 122.1

Other segment information:

Additions to non-current assets
(excluding deferred tax assets,
inventories and financial instruments) 351.0 332.2 92.3 68.0 4.9 848.4

The segment assets and liabilities at 31 December 2023 are as follows:

At 31 December 2023
Other
unallocated
Dugald items/
US$ million Las Bambas Kinsevere River Rosebery eliminations Group
Segment assets4 9,449.3 852.8 687.0 295.8 386.4 11,671.3
Current/deferred income tax assets 229.5
Consolidated assets 11,900.8

Segment liabilities5 3,093.2 317.4 367.6 197.8 2,555.9 6,531.9

Current/deferred income tax liabilities 1,056.9
Consolidated liabilities 7,588.8

Segment non-current assets 8,635.8 725.9 620.9 255.6 267.5 10,505.7

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Continued

The segment revenue and results for the year ended 31 December 2022 are as follows:

For the year ended 31 December 2022

Other
unallocated
items/
US$ million Las Bambas Kinsevere Dugald River Rosebery eliminations Group
Revenue by metal:
- Copper1 1,795.9 421.53 - 8.6 1.7 2,227.7
- Zinc 2
- - 417.9 129.2 - 547.1
- Lead - - 38.1 34.8 - 72.9
- Gold 105.7 - - 45.8 - 151.5
- Silver 66.0 - 28.3 41.5 - 135.8
- Molybdenum 119.2 - - - - 119.2
Revenue from contracts with customers 2,086.8 421.5 484.3 259.9 1.7 3,254.2

EBITDA 1,121.9 131.7 210.2 98.6 (27.0) 1,535.4

Depreciation and amortisation expenses (Note 6) (665.7) (27.8) (57.7) (46.9) 8.0 (790.1)
EBIT 456.2 103.9 152.5 51.7 (19.0) 745.3
Finance income (Note 7) 15.0
Finance costs (Note 7) (299.8)
Income tax expense (Note 8) (217.0)
Profit for the year 243.5

Other segment information:

Additions to non-current assets
(excluding deferred tax assets,
inventories and financial instruments) 354.4 44.8 59.1 52.3 38.3 548.9

The segment assets and liabilities at 31 December 2022 are as follows:

At 31 December 2022
Other
unallocated
items/
US$ million Las Bambas Kinsevere Dugald River Rosebery eliminations Group
Segment assets4 10,275.6 539.6 654.3 276.1 413.7 12,159.3
Current/deferred income tax assets 376.2
Consolidated assets 12,535.5

Segment liabilities5 3,965.4 240.2 358.4 175.4 2,245.4 6,984.8

Current/deferred income tax liabilities 1,322.2
Consolidated liabilities 8,307.0

Segment non-current assets 9,231.8 387.6 583.1 245.3 427.8 10,875.6

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Continued

1 Commodity derivative realised and unrealised net losses with a total amount of US$15.9 million (2022: net gains of US$58.2 million) were included in
“Revenue” of Copper;
2 Commodity derivative realised and unrealised net losses with a total amount of US$3.0 million (2022: net gains of US$14.4 million) were included in
“Revenue” of Zinc;
3. Commodity hedge trades with realised net losses of US$0.3 million (2022: net realised and unrealised gains of US$20.8 million) under “Kinsevere”
were executed by another subsidiary of the Company, MMG Finance Limited located in Hong Kong;
4 Included in segment assets of US$386.4 million (2022: US$413.7 million) under the other unallocated items is cash of US$39.1 million
(2022: US$171.7 million) mainly held in the Group treasury entities and US$213.2 million trade receivables (2022: US$102.9 million) for
MMG South America Company Limited (“MMG SA”) in relation to copper concentrate sales; and
5 Included in segment liabilities of US$2,555.9 million (2022: US$2,245.4 million) under the other unallocated items are borrowings of US$2,459.9 million
(2022: US$2,160.9 million), which are managed at the Group level.

5. Net Other (Expense)/Income

2023 2022
US$ million US$ million
Loss on disposal of property, plant and equipment (2.6) (9.0)
Sundry income 0.4 11.4
Total net other (expense)/income (2.2) 2.4

6. Expenses
Profit before income tax includes the following expenses:

2023 2022
US$ million US$ million
Changes in inventories of finished goods and work in progress 506.8 (298.2)
Write-down of inventories to net realisable value 17.9 3.3
Employee benefit expenses 1
320.6 277.9
Contracting and consulting expenses3 565.5 529.1
Energy costs 360.9 305.4
Stores and consumables costs 511.1 422.9
Depreciation and amortisation expenses 2
913.2 773.8
Other production expenses3 210.4 165.5
Cost of goods sold 3,406.4 2,179.7
Other operating expenses 59.2 41.0
Royalty expenses 140.9 116.4
Selling expenses3 127.4 119.3
Total operating expenses including depreciation and amortisation 4
3,733.9 2,456.4
Exploration expenses 1,2,3
49.6 30.8
Administrative expenses1,3 12.9 16.0
Auditors’ remuneration 1.8 1.7
Foreign exchange loss/(gain) – net 3.5 (6.6)
(Gain)/loss on financial assets at fair value through profit or loss (1.2) 0.3
Other expenses 1,2,3
12.1 12.7
Total expenses 3,812.6 2,511.3

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Continued

1 In aggregate US$45.1 million (2022: US$44.0 million) employee benefit expenses by nature is included in the administrative expenses, exploration
expenses, and other expenses categories. Total employee benefit expenses were US$365.7 million (2022: US$321.9 million) (Note 11).
2 In aggregate US$17.0 million (2022: US$16.3 million) depreciation and amortisation expenses are included in exploration expenses and the other
expenses category. Total depreciation and amortisation expenses were US$930.2 million (2022: US$790.1 million).
3 The expense under these categories include certain amounts in respect of lease and non-lease contracts which were not recognised as right-of-use
assets on the consolidated statement of financial position following the guidance as per HKFRS 16 or where the contracts were low value for a lease
assessment under HKFRS 16 requirements. Expenditure in respect of such contracts assessed as leases but which did not qualify for recognition
as right-of-use assets included US$102.8 million (2022: US$87.8 million) in respect of variable lease payments contracts and US$0.4 million
(2022: US$1.0 million) and US$0.9 million (2022: US$1.3 million) for short-term and low-value lease contracts, respectively.
4 Operating expenses include mining and processing costs, royalties, selling expenses (including transportation) and other costs incurred by operations.

7. Finance Income and Finance Costs

2023 2022
US$ million US$ million
Finance income
Interest income 24.3 15.0
24.3 15.0

Finance costs
Interest expense-3rd party (239.9) (166.8)
Interest expense-related party (Note 30(a)) (108.2) (96.1)
Withholding taxes in respect of financing arrangements (15.2) (10.3)
Unwinding of discount on lease liabilities (12.9) (11.8)
Unwinding of discount on provisions (22.9) (13.4)
Other finance (cost)/refund- 3rd party (0.3) 0.1
Other finance cost – related party (Note 30(a)) 1
(4.0) (1.5)
(403.4) (299.8)
Gain reclassified from equity to profit or loss on
interest rate swaps designated as cash flow hedges (Note 20) 37.0 -
Finance costs – total (366.4) (299.8)

1 For the year ended 31 December 2023, other finance cost – related party includes an amount of US$4.0 million (2022: US$1.5 million) guarantee fee,
paying for guarantee CMC and CMN provided for obtaining certain RCF from external banks.

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Continued

8. Income Tax Expense

Hong Kong profits tax is provided at a rate of 16.5% where there are net assessable profits derived for the year.
The income tax rates applicable for the main jurisdictions in which the Group operates are: Australia (30.0%),
Peru (32.0%) and the DRC (30.0%). Tax rates for some jurisdictions are covered by historical legal agreements
with governments. Taxation on profits arising from other jurisdictions has been calculated on the estimated
assessable profits for the year at the rates prevailing in the relevant jurisdictions.

2023 2022
US$ million US$ million
Current income tax benefit/(expense)
– HK income tax 0.4 (2.6)
– Overseas income tax (139.9) (182.5)

Deferred income tax benefit/(expense)

– HK income tax 1.0 (1.0)
– Overseas income tax 71.0 (30.9)

Income tax expense (67.5) (217.0)

The Group has applied the temporary exception issued by the HKICPA in July 2023 from the accounting
requirements for deferred taxes in HKAS12. Accordingly, the Group neither recognises nor discloses information
about deferred tax assets and liabilities related to Pillar Two income taxes.

On December 2023, Pillar Two legislation was enacted or substantively enacted in certain jurisdictions the Group
operates. The Group is in the scope of the enacted or substantively enacted legislation. However, the legislation
was enacted close to the reporting date. Therefore, the Group is still in the process of assessing the potential
exposure to Pillar Two income taxes as at 31 December 2023. The potential exposure, if any, to Pillar Two
income taxes is currently not known or reasonably estimable. The Group expects to be in a position to report the
potential exposure in its next interim financial statements for the period ending 30 June 2024.

The tax on the Group’s profit before income tax differs from the prima facie amount that would arise using the
applicable tax rate to profit of the consolidated companies as follows:

2023 2022
US$ million US$ million
Profit before income tax 189.6 460.5
Calculated at domestic tax rates applicable to profits or losses in the respective countries (47.4) (128.5)
Net non-taxable/(non-deductible) amounts 4.5 (33.4)
Over/(under) provision in prior years 47.4 (2.5)
Non-creditable withholding tax (70.7) (52.8)
Others (1.3) 0.2
Income tax expense (67.5) (217.0)

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Continued

In addition to the amount charged to profit or loss, the following amounts relating to tax have been recognised in
other comprehensive income:

Year Ended 31 December

2023 US$ million 2022 US$ million
Net of Net of
Before tax Tax income tax Before tax Tax income tax
amount benefit amount amount expense amount
Items that will be reclassified subsequently
to profit or loss:
Fair value gain/(loss) on IRS (17.9) 5.8 (12.1) 82.1 (26.3) 55.8
Movement on IRS closure (37.0) 11.8 (25.2) - - -
(54.9) 17.6 (37.3) 82.1 (26.3) 55.8

9. Earnings Per Share

Basic earnings per share is calculated by dividing the earnings for the year attributable to equity holders of the
Company by the weighted average number of ordinary shares on issue during the year.

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares. For the Company’s share options and
performance awards on issue, a calculation is performed to determine the number of shares that could have
been acquired at fair value (determined at the average market share price of the Company’s shares) based on
the monetary value of the subscription rights attached to outstanding share options and performance awards.
The number of shares calculated as below is compared with the number of shares that would have been issued
assuming the exercise of share options and performance awards.

2023 2022
US$ million US$ million
Earnings attributable to equity holders of the Company in the calculation of basic and diluted
earnings per share 9.0 172.4

Number of Shares ‘000

2023 2022
Weighted average number of ordinary shares used in the calculation of the basic earnings per share 8,649,544 8,639,618
Shares deemed to be issued in respect of long-term incentive equity plans 38,654 57,552
Weighted average number of ordinary shares used in the calculation of the diluted earnings per
share 8,688,198 8,697,170
Basic earnings per share US 0.10 cents US 2.00 cents
Diluted earnings per share US 0.10 cents US 1.98 cents

10. Dividends
The Directors did not recommend the payment of an interim or final dividend for the year ended 31 December
2023 (2022: nil).

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Continued

11. Employee Benefit Expenses, Including Directors’ Emoluments

2023 2022
US$ million US$ million
Salaries and other benefits 349.7 303.9
Retirement scheme contributions (a) 16.0 18.0
Total employee benefit expenses (Note 6) 365.7 321.9

(a) Retirement schemes

The Group provides retirement benefits to all eligible Hong Kong employees under the Mandatory Provident
Fund (MPF Scheme). Under the MPF Scheme, the Group and its employees make monthly contributions to
the MPF Scheme at 5% of the employees’ salaries as defined under the Mandatory Provident Fund legislation.
Contributions of both the Hong Kong subsidiaries and their employees are subject to a maximum of HK$1,500
per month and thereafter contributions are voluntary and are not subject to any limitation. The MPF Scheme is
administered by an independent trustee and its assets are held separately from those of the Group.

The Group provides a superannuation contribution for all Australian-based employees to their nominated
superannuation fund. This contribution is to provide benefits for employees and their dependants in retirement,
and for relevant employees, for disability or death. In accordance with the applicable regulation in Australia, the
Group was required to withhold and deposit 10.5% of ordinary time earnings of all Australian-based employees.
This rate increased to 11% with effect from 1 July 2023. Also, in accordance with the applicable regulation
in Australia, the Group caps the superannuation contributions at the maximum super contribution base. The
maximum super contribution base is used to determine the maximum limit on any individual employee’s earnings
base for each quarter of any financial year. Organisations do not have to provide the minimum support for the
part of earnings above this limit.

The Group provides for retirement benefits to those employees who reach statutory retirement age in the DRC in
accordance with the Collective Bargaining Agreement with its employees at the Kinsevere mine. A provision for
the retirement benefit is recognised which is measured as the present value of the expected future payments to
be made taking into consideration the period of employee service and their job position at the reporting date.

The Group provides on a monthly basis to various defined contribution retirement benefit plans organised by
the relevant municipal and provincial governments in the People’s Republic of China (“PRC”). The municipal and
provincial governments undertake to assume the retirement benefit obligations payable to all existing and future
retired employees under these plans and the Group has no further obligation for post-retirement benefits beyond
the contributions made.

The Group provides pension contributions on a monthly basis for all Peru based employees. There are two
pension schemes in Peru: the National Pension System and the Private Pension System. Employees can elect to
join one of the two pension schemes. Contributions to both schemes are deducted from the employee’s monthly
base salary and no cap applies.

• The National Pension System (Sistema Nacional de Pensiones – ONP), is administered by the state and the
mandatory contribution is 13% of the employee’s total remuneration;
• The Private Pension System (Sistema Privado de Pensiones –SPP) is formed by the Private Pension Funds
Administrators (Administradoras Privadas de Fondos de Pensiones – AFP) and the mandatory contribution is
10% of the monthly base salary, not including fees and insurances. The overall deduction to employee´s salary
is approximately 14%, including fees and insurances charged by AFP.

There is also an Early Retirement Fund for employees who are classified as working in high risk jobs in the
following areas: underground mining, mining extraction to open pit, centres of mining, metallurgical and steel

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Continued

production, exposed to risk of toxicity, insalubrity and danger and construction activities. The employee and
company provide monthly contributions towards the early retirement fund. This additional amount is added to
the employee’s preferred pension scheme.

The Group provides Social Security contributions to all Laos employees in accordance with the relevant
legislation. Contributions will only be made under the National Social Security Scheme and will be calculated
on the accumulation of the employee’s total gross remuneration, capped at the maximum contribution base of
LAK4,500,000. The current contribution rates are:

• 6% of the gross remuneration must be contributed by the employer;

• 5.5% of the gross remuneration must be contributed by the employee.

12. Property, Plant and Equipment

Mine
Plant property Exploration
Land and and and and Construction
US$ million buildings machinery development evaluation in progress Total
At 1 January 2023
Cost 937.6 4,993.8 10,388.8 106.4 502.5 16,929.1
Accumulated depreciation, amortisation
and impairment (386.5) (2,325.8) (4,601.0) (106.4) - (7,419.7)
Net book amount at 1 January 2023 551.1 2,668.0 5,787.8 - 502.5 9,509.4

Year ended 31 December 2023

At the beginning of the year 551.1 2,668.0 5,787.8 - 502.5 9,509.4
Additions (Note 29(b)) 3.7 110.0 242.8 - 457.0 813.5
Depreciation and amortisation (55.4) (285.0) (561.6) - - (902.0)
Disposals, net (2.4) (1.4) - - - (3.8)
Transfers, net 2.9 47.5 190.2 - (240.6) -
At the end of the year 499.9 2,539.1 5,659.2 - 718.9 9,417.1

At 31 December 2023
Cost 940.5 5,251.3 10,713.9 106.4 718.9 17,731.0
Accumulated depreciation, amortisation
and impairment (440.6) (2,712.2) (5,054.7) (106.4) - (8,313.9)
Net book amount at 31 December 2023 499.9 2,539.1 5,659.2 - 718.9 9,417.1

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Continued

Mine Exploration
Land and Plant and property and and Construction
US$ million buildings machinery development evaluation in progress Total
At 1 January 2022
Cost 936.5 4,810.7 10,324.1 106.4 436.0 16,613.7
Accumulated depreciation, amortisation
and impairment (329.4) (2,121.6) (4,293.2) (106.4) - (6,850.6)
Net book amount at 1 January 2022 607.1 2,689.1 6,030.9 - 436.0 9,763.1

Year ended 31 December 2022

At the beginning of the year 607.1 2,689.1 6,030.9 - 436.0 9,763.1
Additions (Note 29(b)) 0.2 100.5 128.0 - 291.2 519.9
Depreciation and amortisation (59.6) (262.2) (442.8) - - (764.6)
Disposals, net - (9.0) - - - (9.0)
Transfers, net 3.4 149.6 71.7 - (224.7) -
At the end of the year 551.1 2,668.0 5,787.8 - 502.5 9,509.4

At 31 December 2022
Cost 937.6 4,993.8 10,388.8 106.4 502.5 16,929.1
Accumulated depreciation, amortisation
and impairment (386.5) (2,325.8) (4,601.0) (106.4) - (7,419.7)
Net book amount at 31 December 2022 551.1 2,668.0 5,787.8 - 502.5 9,509.4

Impairment testing of non-current assets and goodwill

In accordance with the Group’s accounting policies and processes, the Group performs its impairment testing
annually at 31 December. In addition, CGUs are reviewed at each reporting period to determine whether there
is an indication of impairment or impairment reversal. Where an indicator of impairment or impairment reversal
exists, a formal estimate of the recoverable amount is made at the reporting period.

In respect of Las Bambas, the CGU is subject to impairment testing due to goodwill being attributed to the CGU
which requires an annual impairment assessment.

In respect of Kinsevere and Dugald River, impairment losses have been recognised in 2019 and 2015
respectively. Management has reviewed the operational performance and considered the operation’s sensitivity
to a range of factors including commodity prices, throughput, grade, recovery, operation, capital expenditure and
progress of development projects and concluded that there is currently no further impairment or any requirement
to reverse the previously recognised impairment.

No impairment indicators were noted in respect of Rosebery.

(i) Approach to recognition of an impairment loss

An impairment is recognised when the carrying amount exceeds the recoverable amount. The recoverable
amount of each CGU has been estimated using its fair value less costs of disposal (“Fair Value”), which is
consistent with the approach from the prior year. The Group considers the inputs and the valuation approach to
be consistent with the approach taken by market participants.

Estimates of quantities of recoverable minerals, production levels, operating costs and capital requirements
are sourced from the Group’s planning process, including Life of Mine Planning, three-year budgets, periodic

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Continued

forecasts and CGU specific studies. Expected operating performance improvements reflecting the Group’s
objectives to maximise free cash flow, optimise operational activity, apply technology, improve capital and labour
productivity and other production efficiencies are also included along with the expected costs to realise the
initiatives.

All reserves and resources have been included in the valuations at justifiable reasonable conversion rates,
supported by proof of concept studies. Exploration targets are included in the valuation based on management’s
expectation of identifying and converting potential resources to reserves and successfully utilising such
resources.

(ii) Key assumptions

The key assumptions impacting the discounted cash flow models used to determine the Fair Value include:

• Commodity prices;
• Operating costs;
• Production rates;
• Capital requirements;
• Political instability and social unrest impacting regulatory approvals and timing thereof;
• Real post-tax discount rates;
• Foreign exchange rates;
• Reserves and resources and conversion of exploration targets;
• Recovery of taxes;
• Optimisation of operational activity and productivity; and
• Rehabilitation timing.

In determining some of the key assumptions, management considered external sources of information where appropriate.

Commodity price and exchange rate assumptions are based on the latest internal forecasts benchmarked to
analyst consensus forecasts. The long-term cost assumptions are based on actual costs adjusted for planned
operational changes and input cost assumptions over the life of mine.

The long-term price assumed for copper is US$4.03 per pound (2022: US$3.86 per pound) and for zinc is
US$1.30 per pound (2022: US$1.25 per pound).

The long term AUD:USD exchange rate is 0.73 (2022: 0.75).

The real post-tax discount rates used in the Fair Value estimates of the CGU’s are listed below at 10.75% for
Kinsevere (2022: 10.5%), 6.75% for Dugald River and Rosebery (2022: 6.5%) and 8.0% for Las Bambas (2022:
7.75%), reflecting a 0.25% increase in the Weighted Average Cost of Capital (WACC).

Management considers the estimates applied in this impairment assessment are reasonable. However, such
estimates are subject to significant uncertainties and judgements. Refer to (iv) below for sensitivity analysis.

(iii) Valuation methodology

Las Bambas

The Las Bambas Fair Value is determined through CGU discounted cash flows at 31 December 2023. The
valuation is based on the current operation and further regional exploration targets included in the initial
valuation to acquire the mine in 2014. Management continues to work with local communities to secure land
access to continue its exploratory drilling activities, to materialise the potential from such exploration targets.

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Continued

The cash flows assume additional capital investment in the processing plant, tailings facilities and mine
developments as well as expected cost reductions from operational improvement programs. Significant
upcoming projects are included that are subject to regulatory permits and approvals. Future cash flow forecasts
include estimates for the cost of obtaining access to land where the rights do not currently exist.

Political instability at a national level may result in delays of environmental and drilling permits and the ability
to engage with the community and carry out exploration drilling. Although access to the heavy haul road for
concentrate transportation significantly improved from March 2023, management continues to progress dialogue
with local communities and the Government of Peru to ensure the continuity of road access into the future. This
includes continuing to deliver on the Company’s obligations in relation to social and community development
programs and supporting the Government of Peru to progress public investment projects which will improve
the condition of the public road which Las Bambas’ uses for the transport of concentrate to the port, which is
expected to reduce disruptions of road usage into the future.

The impairment assessment of the Las Bambas CGU at 31 December 2023 did not result in the recognition of
any impairment.

Kinsevere

The Kinsevere Fair Value at 31 December 2023 assumes delivery of the Kinsevere Expansion Project (KEP) and
further regional exploration targets which are at varying levels of confidence. KEP was approved in March 2022
and construction is currently underway. KEP will extend the life of Kinsevere by modifying and extending the
existing oxide processing facilities to include a sulphide ore and cobalt processing circuit. The cobalt circuit was
commissioned in Q4 2023 with first copper cathode from sulphides expected in the second half of 2024.

The impairment assessment of the Kinsevere CGU at 31 December 2023 did not result in the recognition of any
further impairment.

In 2019, management had recognised a pre-tax impairment of US$150.0 million due to operational challenges
and risks associated with political and legislative matters. Significant risks and uncertainties still exist in respect
of the application of the Mining Code (2018), additional duties and taxes, and recoverability of VAT receivable
from the DRC Government. The valuation is also sensitive to factors such as copper and cobalt price, discount
rate, recovery, ore loss, KEP schedule and performance and dilution. Considering such risks and sensitivities, no
reversal of previously recognised impairment was required. The Group will continue to monitor and assess if a
reversal of impairment is required in future periods.

Dugald River

The impairment assessment of the Dugald River CGU at 31 December 2023 resulted in in positive headroom
requiring no impairment.

Previously, in 2015, management had recognised a pre-tax impairment loss of US$573.6 million for Dugald River.
Given the value of the headroom and considering that the fair value is highly sensitive to zinc price, exchange
rates and operational performance, management believes no reversal of previously recognised impairment is
required. The Group will continue to monitor and assess if a reversal of impairment is required in future periods.

Rosebery

The Rosebery Fair Value is determined through the 2023 Life of Mine Planning discounted cashflows. No
indicators of impairment were noted for Rosebery and the Fair Value currently supports the carrying value of the
CGU. Consequently, no impairment was recognised.

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Continued

(iv) Sensitivity analysis

Commodity prices, the level of production activity as well as the success of converting reserves, resources,
exploration targets and increasing the resource estimates over the lives of mines are key assumptions in the
determination of Fair Value. Due to the number of risk factors that could impact production activity, such as
processing throughput, changing ore grade and/or metallurgy and revisions to mine plans in response to physical
or economic conditions, no quantified sensitivity has been determined. Changes to these assumptions may
however result in an impact on the Fair Value and result in an impairment in the future.

A sensitivity analysis is presented below for both Las Bambas and Kinsevere. The sensitivities assume that the
specific assumption moves in isolation, whilst all other assumptions are held constant. However in reality, a
change in one of the aforementioned assumptions may accompany a change in another assumption which may
have an offsetting impact. Management action is also usually taken to respond to adverse changes in economic
assumptions that may mitigate the impact of any such change.

Las Bambas

The key assumptions to which the calculation of recoverable amount for Las Bambas is most sensitive are
discount rate, copper prices, operating costs, tax disputes, permitting delays, land access and timing of
identifying and converting potential resources and reserves thereby realising the exploration potential. An
unfavourable movement in any one of these factors may result in a material impairment to the asset with a
favourable movement resulting in a substantial improvement to the recoverable amount.

• A movement of 1% to the discount rate would impact recoverable amount by approximately US$900 million;
• A change of 5% in copper price over the remaining mine life would impact the recoverable amount by
approximately US$1,000 million; and
• A change of 5% in operating costs would impact the recoverable amount by approximately US$450 million.

Political instability and community blockades are potential risks which may result in delays in environmental
and drilling permits and the ability to access land required for carrying out exploration activities and ultimately
the development of operations. They may also cause delays to critical capital projects impacting cashflows.
MMG remains committed to working closely with the government of Peru and community members to reach
an enduring agreement. Potential impacts on Las Bambas’ cashflows due to a level of delays in permits and
disruptions by communities have been considered in the Las Bambas fair value.

At the time of the Las Bambas acquisition in 2014, the initial valuation included significant value to be realised from
exploration targets. Las Bambas’ future cash flows remain significantly dependent on the realisation of the value
from exploration activities. Identification and exploitation of resources depends on obtaining permits and timely and
continued access to drilling targets. There is also a risk that exploration activities may result in lower than expected
actual resources whereby the value assigned to the exploration potential may not be fully recoverable.

Management expects that the impact of delays caused by community disputes, access to land or the amount
and timing of exploration potential realised would result in a revision to the mine plan.

The occurrence of one or more of the above assumptions in isolation, without a change in other assumptions
which may have an offsetting impact, is likely to result in recognition of a material impairment.

Kinsevere

The key assumptions to which the calculation of Fair Value for Kinsevere is most sensitive are copper and
cobalt prices and discount rate. An unfavourable movement in any one of these factors in isolation may result
in a material impairment to the asset with a favourable movement resulting in a substantial improvement to the
recoverable amount.

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Continued

• A change of 5% in copper price over the remaining mine life would impact the recoverable amount by
approximately US$150 million;
• A change of 5% in cobalt price over the remaining mine life would impact the recoverable amount by
approximately US$50 million; and
• A movement of 1% to the discount rate would impact recoverable amount by approximately US$50 million.

13. Right-of-use Assets

Land and Plant and
US$ million building machinery Total
At 1 January 2023
Cost 13.3 148.0 161.3
Accumulated depreciation (10.7) (39.4) (50.1)
Net book amount at 1 January 2023 2.6 108.6 111.2

Year ended 31 December 2023

At the beginning of the year 2.6 108.6 111.2
Additions, net 5.2 28.5 33.7
Depreciation (2.7) (24.1) (26.8)
At the end of the year 5.1 113.0 118.1

At 31 December 2023
Cost 16.9 168.0 184.9
Accumulated depreciation (11.8) (55.0) (66.8)
Net book amount at 31 December 2023 5.1 113.0 118.1

At 1 January 2022
Cost 12.6 144.2 156.8
Accumulated depreciation (9.2) (43.0) (52.2)
Net book amount at 1 January 2022 3.4 101.2 104.6

Year ended 31 December 2022

At the beginning of the year 3.4 101.2 104.6
Additions, net 0.8 26.0 26.8
Depreciation (1.6) (18.6) (20.2)
At the end of the year 2.6 108.6 111.2

At 31 December 2022
Cost 13.3 148.0 161.3
Accumulated depreciation (10.7) (39.4) (50.1)
Net book amount at 31 December 2022 2.6 108.6 111.2

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Continued

14. Intangible Assets

Software
US$ million Goodwill development Total
At 1 January 2023
Cost 739.9 215.9 955.8
Accumulated amortisation and impairment (211.4) (210.2) (421.6)
Net book amount at 1 January 2023 528.5 5.7 534.2

Year ended 31 December 2023

At the beginning of the year 528.5 5.7 534.2
Additions, net - 1.2 1.2
Amortisation - (1.4) (1.4)
At the end of the year 528.5 5.5 534.0

At 31 December 2023
Cost 739.9 217.1 957.0
Accumulated amortisation and impairment (211.4) (211.6) (423.0)
Net book amount at 31 December 2023 528.5 5.5 534.0

At 1 January 2022
Cost 739.9 214.3 954.2
Accumulated amortisation and impairment (211.4) (205.5) (416.9)
Net book amount at 1 January 2022 528.5 8.8 537.3

Year ended 31 December 2022

At the beginning of the year 528.5 8.8 537.3
Additions - 2.2 2.2
Amortisation - (5.3) (5.3)
At the end of the year 528.5 5.7 534.2

At 31 December 2022
Cost 739.9 215.9 955.8
Accumulated amortisation and impairment (211.4) (210.2) (421.6)
Net book amount at 31 December 2022 528.5 5.7 534.2

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Notes to Consolidated Financial Statements

Continued

15. Investment in Subsidiaries

The following is a list of the principal subsidiaries of the Group at 31 December 2023 and 2022:

Proportion of issued capital held

by the Company
Place of
2023 2022
incorporation/ Particulars of issued
Name of company operation Principal activities or paid-up capital Directly Indirectly Directly Indirectly
Mineral exploration
and production,
MMG Australia management and 490,000,000 Ordinary
Limited Australia employment services Shares at A$11 a share - 100% - 100%
MMG Dugald River Holds Dugald River 301,902,934 Ordinary
Pty Ltd Australia Assets Shares at A$1 a share - 100% - 100%
MMG Exploration 1 Ordinary Share at
Pty Ltd Australia Investment holding A$1 a share - 100% - 100%
MMG Management Treasury and 1 Ordinary Share at
Pty Ltd Australia management services A$1 a share - 100% - 100%
British Virgin 1,386,611,594 Ordinary
Topstart Limited Islands Investment holding Shares at US$1 a share 100% - 100% -
Anvil Mining British Virgin 100 Class A Common
Limited Islands Investment holding Shares at US$1 - 100% - 100%
MMG Resources 200 Common Shares
Inc. Canada Mineral exploration at C$11 a share - 100% - 100%
MMG Kinsevere Mineral exploration 10,000 Ordinary Shares
SARL DRC and production at CDF1 10,000 a share - 100% - 100%
1 Ordinary Share
MMG Exploration Mineral exploration providing a share
Holdings Limited Hong Kong and holding company capital of HK$11 100% - 100% -

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Continued

Proportion of issued capital held

by the Company
Place of
2023 2022
incorporation/ Particulars of issued
Name of company operation Principal activities or paid-up capital Directly Indirectly Directly Indirectly
1 Ordinary Share
MMG Finance Administration and providing a share
Limited Hong Kong treasury services capital of HK$1 100% - 100% -
1,880,000 Ordinary
MMG South Investment holding Shares providing
America Company and sales of copper a share capital of
Limited Hong Kong concentrate HK$1,880,000 100% - 100% -
MMG South 1,200 Ordinary
America Shares providing
Management Holding investments a share capital of
Company Limited Hong Kong in Peru HK$28,046,249,501 - 62.5% - 62.5%
MMG Netherlands 5,000 Ordinary Shares
B.V. Netherlands Investment holding at EUR11 a share - 62.5% - 62.5%
15,107,754,037
Minera Las Bambas Mineral exploration Common Shares at
S.A. Peru and production PEN1 1 a share - 62.5% - 62.5%
Album Investment 488,211,901 Ordinary
Pte Ltd Singapore Investment holding Shares at S$11 a share - 100% - 100%
Album Resources 488,211,901 Ordinary
Pte Ltd Singapore Investment holding Shares at S$11 a share - 100% - 100%
100,000 Ordinary
MMG Swiss Investment holding Shares at CHF11 a
Finance AG Switzerland and financial services share - 62.5% - 62.5%
MMG Beijing Corporate Registered capital
Co., Ltd Beijing management services of CNY1 10,000,000 100% - 100% -

1. A$, C$, CDF, HK$, S$, PEN, CHF, CNY and EUR stand for Australian dollar, Canadian dollar, Congo dollar, Hong Kong dollar, Singapore dollar, Peruvian
Sol, Swiss Franc, Chinese Yuan and Euro respectively.

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Notes to Consolidated Financial Statements

Continued

16. Principal Subsidiaries with Material Non-Controlling Interests

The Group had total non-controlling interests of US$2,188.6 million at 31 December 2023
(2022: US$2,089.5 million) which relate to the Las Bambas Joint Venture Group.

The summarised financial information is shown on a 100% basis. It represents the amounts shown in the Las
Bambas Joint Venture Group’s consolidated financial statements prepared in accordance with HKFRSs under
Group’s accounting policies, before inter-company eliminations.

At 31 December
US$ million 2023 2022
Summarised Consolidated Statement of Financial Position
Assets 9,930.7 10,685.5
Current 1,227.8 1,225.2
Include: Cash and cash equivalents 399.2 171.8
Non-current 8,702.9 9,460.3
Liabilities (4,094.4) (5,113.6)
Current (970.1) (1,393.0)
Non-current (3,124.3) (3,720.6)
Net assets 5,836.3 5,571.9

Year Ended 31 December

2023 2022
Summarised Consolidated Statement of Comprehensive Income
Revenue 3,417.3 2,086.8
Net financial cost 202.6 181.1
Income tax expense 92.4 85.5
Profit for the year 301.0 189.5
Other comprehensive (loss)/income for the year (37.3) 55.8
Total comprehensive income 263.7 245.3

Total comprehensive income attributable to:

Equity holders of the Company 164.6 153.3
Non-controlling interests 99.1 92.0
263.7 245.3

Year Ended 31 December

2023 2022
Summarised Consolidated Statement of Cash Flows
Net increase/(decrease) in cash and cash equivalents 227.4 (664.5)
Cash and cash equivalents at 1 January 171.8 836.3
Cash and cash equivalents at 31 December 399.2 171.8

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Continued

17. Inventories
2023 2022
US$ million US$ million
Non-current
Work in progress 115.0 122.2
Current
Stores and consumables 164.7 130.7
Work in progress 175.7 177.6
Finished goods 49.1 564.3
389.5 872.6
Total 504.5 994.8

18. Deferred Income Tax

The movements in deferred income tax assets/(liabilities) during the years are as follows:

Property, plant
US$ million and equipment Provisions Tax losses Others Total
At 1 January 2022 (1,104.1) 239.1 - 30.9 (834.1)
(Charged)/credited to profit or loss (Note 8) (167.8) 10.5 152.1 (26.7) (31.9)
Charged to other comprehensive income (Note 8) - (26.3) (26.3)
At 31 December 2022 (1,271.9) 249.6 152.1 (22.1) (892.3)
Credited/(charged) to profit or loss (Note 8) 158.6 69.2 (148.0) (7.8) 72.0
Charged to other comprehensive loss (Note 8) - - - 17.6 17.6
At 31 December 2023 (1,113.3) 318.8 4.1 (12.3) (802.7)

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current
income tax assets against current income tax liabilities and when the deferred income taxes relate to income
tax levied by the same taxation authority on either the same taxation entity or different taxation entities, and
there is an intention to settle the balances on a net basis. The following amounts, determined after appropriate
offsetting, are shown in the consolidated statement of financial position:

2023 2022
US$ million US$ million
Deferred income tax assets 150.0 315.7
Deferred income tax liabilities (952.7) (1,208.0)
(802.7) (892.3)

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Notes to Consolidated Financial Statements

Continued

The Group only recognises deferred income tax assets for deductible temporary differences and unused tax
losses if it is probable that future taxable amounts will be available to utilise those temporary differences and
tax losses in the foreseeable future. Management will continue to assess the recognition of deferred income tax
assets in future reporting periods. At 31 December 2023 and 2022, the Group had unrecognised deferred tax
losses and temporary differences as follows:

2023 2022
US$ million US$ million
Tax losses (tax effected) 29.9 33.5
Deductible temporary differences (tax effected) 45.3 47.0
At 31 December 75.2 80.5

Unrecognised tax losses of US$21.9 million (2022: US$23.8 million) were with expiry years ranging from 2024 to
2038 (2022: from 2023 to 2037 ). Other losses will be carried forward indefinitely.

19. Trade and Other Receivables

2023 2022
US$ million US$ million
Non-current other receivables
Prepayment 0.3 -
Other receivables – government taxes (net of provisions) 1
20.3 11.4
Sundry receivables, net of provisions2 148.2 156.1
168.8 167.5
Current trade and other receivables
Trade receivables3 (Note 31.1(c) (d) and (e),31.3 and 31.4) 354.8 212.7
Prepayments 32.9 20.0
Other receivables – government taxes 1
66.0 74.0
Sundry receivables 22.3 35.8
476.0 342.5

1 The government taxes amount mainly consists of VAT receivables associated with the Group’s operations in Peru and DRC.
2 Sundry receivables amount mainly consists of receivables from Glencore in MLB acquisition project and VAT2011/12 receivables from SUNAT.
3 At 31 December 2023 and 2022, trade receivables of the Group mainly related to the mining operations. The majority of sales for mining operations
were made under contractual arrangements whereby provisional payment is received in line with requirement under the sales contract, usually within
30 days of submission of all required documentation and fulfilment of obligations under the respective incoterm for the sales; Upon issuance of final
invoice at end of the quotational period, any remaining balance is then payable within 30 days from such final invoice being issued. All the trade
receivables at 31 December 2023 and 2022 were within 6 months from the date of invoice. At 31 December 2023, there was no trade receivable past
due (2022: nil). At 31 December 2023, the Group’s trade receivables, other receivables and prepayments included an amount of US$160.9 million
(2022: US$106.4 million) which were due from related companies of the Group (Note 30(d)). The carrying amounts of the Group’s trade receivables are
all denominated in US$.

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Continued

20. Derivative Financial Assets/(Liabilities)

2023 2022
US$ million US$ million
Assets
Non-current
Interest rate swap1 - 113.9
Current
Commodity derivative-Copper 3.1 8.1
Commodity derivative-Zinc - 4.0
3.1 126.0

Liabilities
Current
Commodity derivative-Copper - (0.3)
- (0.3)

1 In June 2020, the Group entered into a notional US$2,100 million 5-year amortising interest rate swap (“IRS”) with Bank of China, Sydney branch
(“BOC Sydney”). The purpose of the arrangement was to fix approximately half of the interest rate exposure accompanying the floating interest rate
project facility at Las Bambas for a period of 5 years. The IRS was designated as a cash flow hedge and consequently fair value changes were initially
recognised under other comprehensive income (“OCI”) and recycled to the profit and loss when realised in accordance with the repayment schedule
on the project facility.
In June 2023, management closed the IRS. As at the date of closure, the IRS had a positive valuation of $96.0 million cash proceeds received on 3 July
2023. Fair value gains on the IRS are retained in the OCI and is recycled to profit and loss over the life of the original IRS based on the cashflow profile
of the IRS at the time of closure. For the year ended 31 December 2023, post-tax OCI from IRS contracts was loss of US$37.3 million (2022: gain of
US$55.8 million). Refer to Note 31.1 (b) for further details. As at 31 December 2023, the OCI remaining credit balance is US$40.2 million (31 December
2022: US$77.5 million).

21. Other Financial Assets

2023 2022
US$ million US$ million
Non-current financial assets (Note 31.1(c) (e),31.3 and 31.4)
Financial assets at fair value through profit or loss – listed1 2.7 1.5
2.7 1.5

1 Financial assets at fair value through profit or loss are listed investments outside Hong Kong and their carrying values are equal to their market values.

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Continued

22. Cash and Cash Equivalents

2023 2022
US$ million US$ million
Cash at bank and in hand 138.8 191.2
Short-term bank deposits and others 2
308.2 181.0
Total (Note 31.1 (b) (c) and (e), 31.3 and 31.5)
1
447.0 372.2

1 Total cash and cash equivalents include US$399.2 million (2022: US$171.8 million) of cash held limited for use by Las Bambas Joint Venture Group.
2 The effective interest rate on short-term bank deposits as at 31 December 2023 range from 5.37% to 5.70% (31 December 2022: 4.37% to 4.55%).
These deposits have an average 29 days (2022: 18 days) to maturity.

The carrying amounts of the cash and cash equivalents are denominated in various currencies. Refer to Note 31.1
(c) for details.

23. Share Capital

Number of Ordinary Shares Share Capital
2023 2022 2023 2022
‘000 ‘000 US$ million US$ million
Issued and fully paid:
At 1 January 8,639,767 8,639,126 3,220.5 3,220.3
Employee share options exercised 1
3,159 641 1.9 0.2
Employee performance awards vested2 13,121 - 2.2 -
At 31 December 8,656,047 8,639,767 3,224.6 3,220.5

1 During the year ended 31 December 2023, a total of 3,158,983 (2022: 640,980) new shares were issued as a result of employee share options
exercised at a weighted average exercise price of HK$2.29 per share under the Company’s 2016 Share Option Scheme which were pursuant to 2013
Share Option Scheme. The weighted average closing price of the shares of the Company immediately before the date on which the options were
exercised was HK$2.83 (2022: HK$3.08) (Note 33), refer to Note 33 for more details of 2016 Share Option Scheme;
2 During the year ended 31 December 2023, a total of 13,120,972 new shares were issued as a result of 2020 Performance Awards vesting on 1 June
2023. The closing price of the shares of the Company immediately before the date on which the performance award was exercised was HK$2.35.
Refer to Note 33 for more details of 2020 Performance Awards.

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Continued

24. Reserves and Retained Profits

Share-
Special Exchange based Cash flow
capital translation Merger Surplus payment hedge Other Total Retained
US$ million reserve reserve reserve1 reserve2 reserve reserve3 reserve reserves profits Total

At 1 January 2023 9.4 2.7 (1,946.9) 50.2 9.9 48.5 (0.5) (1,826.7) 745.2 (1,081.5)

Profit for the year - - - - - - - - 9.0 9.0

Other comprehensive
loss for the year - - - - - (23.3) (1.0) (24.3) - (24.3)
Total comprehensive
(loss)/income for the year - - - - - (23.3) (1.0) (24.3) 9.0 (15.3)

Provision of
surplus reserve - - - 0.4 - - - 0.4 (0.4) -
Employee long-term
incentives - - - - (1.5) - - (1.5) - (1.5)
Employee share options
and performance awards
vested and exercised - - - - (2.9) - - (2.9) - (2.9)
Employee share
options lapsed - - - - (0.1) - - (0.1) 0.1 -
Total transactions
with owners - - - 0.4 (4.5) - - (4.1) (0.3) (4.4)
At 31 December 2023 9.4 2.7 (1,946.9) 50.6 5.4 25.2 (1.5) (1,855.1) 753.9 (1,101.2)

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Continued

(Accum-
Share- ulated
Special Exchange based Cash flow losses)/
capital translation Merger Surplus payment hedge Other Total retained
US$ million reserve reserve reserve1 reserve2 reserve reserve3 reserve reserves profits Total

At 1 January 2022 9.4 2.7 (1,946.9) 50.1 8.9 13.6 (0.5) (1,862.7) 572.9 (1,289.8)

Profit for the year - - - - - - - - 172.4 172.4

Other comprehensive
income for the year - - - - - 34.9 - 34.9 - 34.9
Total comprehensive
income for the year - - - - - 34.9 - 34.9 172.4 207.3

Provision of
surplus reserve - - - 0.1 - - - 0.1 (0.1) -
Employee long-term
incentives - - - - 1.1 - - 1.1 - 1.1
Employee share options
vested and exercised - - - - (0.1) - - (0.1) - (0.1)
Total transactions
with owners - - - 0.1 1.0 - - 1.1 (0.1) 1.0
At 31 December 2022 9.4 2.7 (1,946.9) 50.2 9.9 48.5 (0.5) (1,826.7) 745.2 (1,081.5)

1 Merger reserve represents the excess of investment cost in entities that have been accounted for under merger accounting for common control
combinations in accordance with AG5 (Accounting Guideline 5 issued by the HKICPA) against their share capital;
2 According to the General Law of Companies in Peru, surplus reserve is constituted by transferring 10%, as a minimum, of the net income for each
period, after deducting accumulated losses, until reaching an amount equivalent to a fifth of capital.
3 The cashflow hedge reserve records the portion of the gain or loss on a hedging instrument and the related transaction in a cash flow hedge that are
determined to be effective. For year ended 31 December 2023, there was realised gains of US$37.0 million (net of tax amount: US$25.2 million) (2022:
nil) which were transferred to “financial costs” from interest rate swap closure (Note 7 and 31.1 (b)).

Distributable reserves

At 31 December 2023 and 2022, the Company did not have any distributable reserves available for distribution
to shareholders.

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Continued

25. Borrowings
2023 2022
US$ million US$ million
Non-current
Loan from related parties (Note 30(d)) 1,831.3 2,231.3
Bank borrowings, net 1,544.5 1,978.3
3,375.8 4,209.6
Current
Loan from related parties (Note 30(d)) 900.0 400.0
Bank borrowings, net 431.3 803.0
1,331.3 1,203.0
Analysed as:
– Secured 2,016.8 2,675.7
– Unsecured 2,731.3 2,781.2
4,748.1 5,456.9
Prepayments – finance charges (41.0) (44.3)
4,707.1 5,412.6
Borrowings (excluding: prepayments) were repayable as follows:
– Within one year 1,336.8 1,208.8
– More than one year but not exceeding two years 1,078.0 1,136.8
– More than two years but not exceeding five years 1,620.4 2,181.6
– More than five years 712.9 929.7
4,748.1 5,456.9
Prepayments – finance charges (41.0) (44.3)
Total (Notes 31.1(b), (c), (e) and 31.3) 4,707.1 5,412.6

An analysis of the carrying amounts of the total borrowings (excluding prepayments) by type and currency is as
follows:

2023 2022
US$ million US$ million
US dollars
– At floating rates 2,586.8 1,713.6
– At fixed rates 2,161.3 3,743.3
4,748.1 5,456.9

The effective interest rate of borrowings during the year ended 31 December 2023 was 5.2% (2022: 4.3%) per annum.

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Continued

At 31 December 2023, certain borrowing of the Group was secured as follow:

(a) US$2,016.8 million (2022: US$2,653.6 million) from China Development Bank, ICBC, BOC Sydney and Export-
Import Bank of China was secured by share security over the entire share capital of MMG South America
Management Co Ltd and each of its subsidiaries including MLB, a debenture over the assets of MMG South
America Management Co Ltd, an assets pledge agreement and production unit mortgage in respect of all of
the assets of MLB, assignments of shareholder loans between MMG South America Management Co Ltd and
its subsidiaries and security agreements over bank accounts of MLB.
Note: T
 he US$22.1 million borrowing as at 31 December 2022 from ICBC Peru Bank, Banco de Crédito del Peru and Scotiabank Peru secured by
mine fleet equipment procured under asset finance arrangements was fully paid during the year ended 31 December 2023.

Reconciliation of borrowings arising from financing activities

Non-Cash Changes
1 January Financing Effective Other 31 December
US$ million Notes 2023 Cashflow1 Interest Changes 2 2023
Loans from related parties 30(d) 2,631.3 100.0 - - 2,731.3
Bank borrowings 25 2,781.3 (808.8) - 3.3 1,975.8
Accrued interest 3
28, 30(d) 46.0 (327.8) 332.7 - 50.9
5,458.6 (1,036.6) 332.7 3.3 4,758.0

Non-Cash Changes
1 January Financing Effective Other 31 December
US$ million Notes 2022 Cashflow1 Interest Changes2 2022
Loan from related parties 30(d) 2,531.3 100.0 - - 2,631.3
Bank borrowings 25 3,766.8 (991.4) - 5.9 2,781.3
Accrued interest 3
28, 30(d) 42.8 (249.6) 252.8 - 46.0
6,340.9 (1,141.0) 252.8 5.9 5,458.6

1 Net bank borrowings financing cashflow is made up of repayments of and proceeds from borrowings in the consolidated statement of cash flows.
2 Other changes include the amortisation of capitalised prepayments on borrowings.
3 Accrued interest includes both interest on external bank borrowings and related party borrowings.

A fundamental reform of major interest rate benchmarks has been undertaken globally to replace some interbank
offered rates (“IBORs”) with alternative nearly risk-free rates. As at 31 December 2023, the London Interbank
Offered Rate (“LIBOR”) has ceased to be published. As such, the Group has finalised its US dollar LIBOR
replacement to SOFR in respect of key existing borrowings and certain operating contracts that had LIBOR
provisions actively in use.

During the year ended 31 December 2023, the Group transitioned US$2,653.6 million bank borrowings, and
US$620.0 million related parties’ facilities to SOFR with a credit adjustment spread. No other terms were
amended as part of the transition. The Group accounted for the change to SOFR using the practical expedient in
HKFRS 9, which allows the Group to change the basis for determining the contractual cash flows prospectively
by revising the effective interest rate.

The Group also updated certain sales, supply and trade finance contracts that refer to LIBOR to calculate interest
or interest on receiving early payments. These have been transitioned to Term SOFR plus a credit adjustment
spread for trade finance contracts.

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Notes to Consolidated Financial Statements

Continued

26. Lease Liabilities

2023 2022
US$ million US$ million
Non-current
Lease liabilities 125.6 117.4

Current
Lease liabilities 22.0 21.3
Total (Notes 31.1(c) and (e), 31.3) 147.6 138.7

Lease liabilities were repayable as follows:

– Within one year 22.0 21.3
– More than one year but not exceeding two years 22.2 15.3
– More than two years but not exceeding five years 43.0 35.4
– More than five years 60.4 66.7
147.6 138.7

The weighted average incremental borrowing rates applied to new lease liabilities at 31 December 2023 was
from 5.15% to 8.60% (2022: from 3.13% to 6.84%).

Refer to Note 31.1(e) for maturity profile of the undiscounted lease liabilities. In respect of such lease liabilities,
the Group generally does not have any early termination options. However, in case of certain leases the Group
has extension option exercisable at the discretion of the Group. Such extension options allow for operational
flexibility in managing the Group’s assets. Where the Group assesses at lease commencement date that it
is reasonably certain to exercise the extension options, rentals during the extension period are included in
determination of lease liability. The undiscounted potential estimated exposure in respect of future lease
payments for extension options which the Group is not reasonably certain to exercise is presented as follows:

2023 2022
US$ million US$ million
- Within one year 0.4 0.7
- More than one year but not exceeding two years 0.6 3.9
- More than two years but not exceeding five yeas 3.3 10.4
- More than five years 41.0 43.4
Total 45.3 58.4

As presented under financing cashflows in the consolidated statement of cashflows, cash outflows for
lease payments of US$37.7 million (2022: US$31.2 million) include repayment of US$24.8 million principal
(2022: US$19.4 million) and US$12.9 million interest (2022: US$11.8 million).

In respect of lease contracts not recognised as right-of-use assets in line with HKFRS 16 requirements (refer to
Note 6), payments of US$104.1 million (2022: US$90.1 million) have been presented under operating cash flows.

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Continued

27. Provisions
2023 2022
US$ million US$ million
Non-current
Employee benefits 28.3 17.4
Mine rehabilitation, restoration and dismantling (a) 443.8 401.8
Other provisions1 174.9 180.0
Total non-current provisions 647.0 599.2

Current
Employee benefits 49.0 26.2
Workers’ compensation 0.1 0.2
Mine rehabilitation, restoration and dismantling (a) 3.8 3.2
Other provisions1 74.4 51.4
Total current provisions 127.3 81.0

Aggregate
Employee benefits 77.3 43.6
Workers compensation 0.1 0.2
Mine rehabilitation, restoration and dismantling (a) 447.6 405.0
Other provisions1 249.3 231.4
Total provisions 774.3 680.2

1 Other provisions primarily include amounts for certain tax related matters.

(a) Mine rehabilitation, restoration and dismantling

2023 2022
US$ million US$ million
At 1 January 405.0 475.3
Recognition /(reversal) of provisions 20.5 (68.1)
Payments made (1.6) (3.0)
Unwinding of discount on provisions 22.4 13.1
Exchange rate differences 1.3 (12.3)
At 31 December 447.6 405.0

Provision is made in these consolidated financial statements for the anticipated costs of the mine rehabilitation
obligations under the mining leases and exploration licences.

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Continued

28. Trade and Other Payables

The analysis of the trade and other payables is as follows:

2023 2022
US$ million US$ million
Non-Current
Other payables and accruals 286.5 217.5

Current
Trade payables
- Less than 6 months 322.5 271.9
- More than 6 months - 0.4
322.5 272.3
Related party interest payable (Note 30(d)) 45.5 37.6
Other payables and accruals 248.4 225.6
Total current trade and other payables 616.4 535.5

Aggregate
Trade payables1 322.5 272.3
Related party interest payable(Note 30(d)) 45.5 37.6
Other payables and accruals 2
534.9 443.1
Total trade and other payables (Notes 31.1(c),(e) and 31.3) 902.9 753.0

1 At 31 December 2023, the Group’s trade and other payables included an amount of US$4.2 million (2022: US$3.5 million) (Note 30(d)), which was due
to a related company of the Group. The ageing analysis of the trade payables is based on the creditors’ invoice date.
2 At 31 December 2023, the Group’s other payables and accruals included an amount of US$5.4 million (2022: US$8.4 million) accrued interest on
external bank borrowings.

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Continued

29. Notes to Consolidated Statement of Cash Flows

(a) Reconciliation of profit for the year to net cash generated from operating activities is as follows:

2023 2022
US$ million US$ million
Profit for the year 122.1 243.5
Adjustments for:
Finance income (Note 7) (24.3) (15.0)
Finance costs 366.4 309.3
Depreciation and amortisation expenses (Note 6) 930.2 790.1
Loss on disposal of property, plant and equipment (Note 5) 2.6 9.0
(Gain)/loss on financial assets at FVTPL (Note 6) (1.2) 0.3
Share-based payment (1.5) 1.1
Unrealised gain on commodity hedge 1
(3.1) (11.8)
Changes in working capital:
Inventories 490.3 (311.9)
Trade and other receivables (126.2) (142.7)
Trade and other payables 67.2 56.8
Provisions 50.8 (28.6)
Tax assets and tax liabilities (23.4) (68.0)
Net cash generated from operating activities 1,849.9 832.1

1 The unrealised gain on commodity derivative is recognised in revenue.

(b) In the Consolidated Statement of Cash Flows, purchase of property, plant and equipment comprises:

2023 2022
US$ million US$ million
Total additions (Note 12) 813.5 519.9
Adjustments for non-cash (addition)/reduction
(Recognition)/reversal of provisions for mine rehabilitation, restoration and dismantling1 (21.8) 80.4
Other non-cash additions (1.7) (35.8)
Purchase of property, plant and equipment 790.0 564.5

1 The transfer from provision for mine rehabilitation, restoration and dismantling included the impact of exchange rate differences on foreign currency
provisions for mine rehabilitation, restoration and dismantling for operating sites. Refer to Note 27(a) for details.

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Continued

30. Significant Related Party Transactions

The Group is controlled by CMN through China Minmetals H.K. (Holdings) Limited (“Minmetals HK”), which is
a subsidiary of CMN. At 31 December 2023, 67.6% (31 December 2022: 67.7%) of the Company’s shares were
held by CMN and 32.4% (31 December 2022: 32.3% ) were widely held by the public. The Directors consider
the ultimate holding company to be CMC, a stated-owned company incorporated in the PRC, of which CMN is a
subsidiary.

For the purposes of the related party transaction disclosures, the Directors believe that meaningful information in
respect of related party transactions has been adequately disclosed. In addition to the related party information
and transactions disclosed elsewhere in the consolidated financial statements, the following is a summary of
significant related party transactions entered into in the ordinary course of business between the Group and its
related parties during the year.

(a) Transactions with CMC and its group companies (other than those within the Group)

2023 2022
US$ million US$ million
Sales
Sales of non-ferrous metals 2,027.5 1,308.5
Commodity derivatives transaction
(Loss)/gain on commodity derivatives (15.6) 36.9
Other (loss) (1.3) -
Purchases
Purchases of consumables and services (22.9) (29.8)
Finance costs – net
Interest expense (Note 7) (108.2) (96.1)
Other finance cost (Note 7) (4.0) (1.5)

Guarantee

CMN continues to provide a credit guarantee supporting MMG Finance Limited (“MMF”, a subsidiary of the
Company), in respect of the US$300.0 million RCF with ICBC. This facility was extended during the year and now
expires in 2026 (refer Note 2.1 (a)).

(b) Transactions and balances with other state-owned enterprises

During the year ended 31 December 2023, the Group’s significant transactions with Chinese state-owned
enterprises (excluding CMC and its subsidiaries) are sales of non-ferrous metals and purchases of consumables
and services and the related receivables and payables balances. These transactions were based on terms as
set out in the underlying agreements, on statutory rates or market prices or actual cost incurred, or as mutually
agreed.

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Continued

(c) Key management compensation

Key management includes Directors (executive and non-executive) and members of the Executive Committee.
The key management personnel remuneration for the Group was as follows:

2023 2022
US$ million US$ million
Salaries and other short-term employee benefits 4.0 3.9
Short-term incentives and discretionary bonus 1.6 1.6
Long-term incentives 0.5 0.5
Post-employment benefits 0.1 0.1
6.2 6.1

(d) Year-end balances

2023 2022
US$ million US$ million
Amounts payable to related parties
Loan from Top Create Resources Limited (“Top Create”)1 2 (Note 25) 2,461.3 2,161.3
Loan from Album Trading Company (Note 25)3
270.0 270.0
Loan from Album Enterprises Limited (Note 25) - 200.0
Interest payable to related parties (Note 28) 45.5 37.6
Trade and other payable to CMN (Note 28) 4.2 3.5
2,781.0 2,672.4
Amounts receivable from related parties(Note 19)
Trade receivables from CMN 159.1 102.6
Other receivables from CMN 1.8 2.6
Prepayments from CMN - 1.2
160.9 106.4
Derivative financial assets from a related party 3.1 1.8

1 The loan amount from Top Create includes the amounts drawn by the Company on 22 July 2014 (US$1,843.8 million) and 16 February 2015 (US$417.5
million) pursuant to a facility agreement dated 22 July 2014 between MMG SA and Top Create. In accordance with that agreement, a loan facility of up
to US$2,262.0 million was made available to MMG SA, for a period of eleven years commencing on the date of the first drawdown of the loan. The loan
repayments falling due in four separate tranches in July 2023 (US$200.0 million), July 2024 (US$700.0 million), July 2025 (US$861.3 million) and July
2026 (US$400.0 million). In July 2023, MMG SA successfully deferred US$200.0 million of the first tranche to an indefinite future date at which the
US$300.0 million Top Create facility for KEP is available. The facility incurs interest at a separate all-in fixed rate for each of the repayment tranches of
between 2.20% and 4.50% per annum, which is payable annually.
2 The loan amount from Top Create includes US$300 million drawn by the Company on 7 December 2023 pursuant to a facility agreement dated 7
December 2023 between MMF and Top Create. In accordance with that agreement, a loan facility of up to US$1.0 billion was made available to MMF,
for a period of three years commencing on the date of the first drawdown of the loan. The interest rate is SOFR plus margin.
3 The borrowing from Album Trading Company Limited (a subsidiary of CMN) is a project facility and will mature in June 2026. The interest rate is SOFR
plus margin and a credit adjustment spread.

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Continued

31. Financial and Other Risk Management

31.1 Financial risk factors

The Group’s activities expose it to a variety of financial risks, including commodity price risk, interest rate
risk, foreign exchange risk, credit risk, liquidity risk and risk arising from the interest benchmark reform. The
Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to
minimise potential adverse effects on the Group’s financial performance. The Group can use derivative financial
instruments such as interest rate swaps, collar hedges and commodity swaps to manage certain exposures.
The Group does not and is prohibited from entering into derivative contracts for speculative purposes.

Financial risk management is carried out by the Group Treasury function under proposals approved by the Board.
Group Treasury identifies, evaluates and manages financial risks in close cooperation with the Group’s operating
units. The Board approves written principles for overall risk management, as well as policies covering specific
areas, such as those identified below.

(a) Commodity price risk

The prices of copper, zinc, lead, gold, silver and molybdenum are affected by numerous factors and events that
are beyond the control of the Group. These metal prices change on a daily basis and can vary significantly up
and down over time. The factors impacting metal prices include both broader macro-economic developments
and micro-economic considerations relating more specifically to the particular metal concerned.

During the year ended 31 December 2023, the Group entered into various commodity trades to hedge the sales
prices for copper and zinc. The outstanding commodity trades included:

• Zero/low-cost collar hedges:

֢ 3,000 tons of copper with put strike price of US$9,000/ton and call strike price of US$9,300/ton;
• Fixed price swap hedges:

֢ 24,500 tons of copper with fixed price ranging from US$8,607/ton to US$8,672/ton;
• Above hedges settlement ranged from January to April 2024.

A change in commodity prices during the year can result in favourable or unfavourable financial impact for the
Group.

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Continued

The following table contains details of the hedging instrument used in the Group’s hedging strategy:

Favourable/(Unfavourable)
changes in fair value used for
measuring ineffectiveness
Settled portion Hedging
Carrying of hedging gain/(loss)
amount of instrument recognised Cost of
hedging Hedging Hedged realised in cash flow hedging
instrument instrument item gains/(losses) hedge reserve reserve
Term US$ million US$ million US$ million US$ million US$ million US$ million
Cash flow hedges:
At 31 December 2023
Derivative financial March 2023 to
assets/(liabilities) December 2023 - - - 10.8 - -
At 31 December 2022
Derivative financial March 2022 to
assets/(liabilities) December 2022 - - - 47.0 - -

The following table details the sensitivity of the Group’s financial assets balance to movements in commodity
prices. Financial assets arising from revenue on provisionally priced sales are recognised at the estimated fair
value of the total consideration of the receivable and subsequently remeasured at each reporting date. At the
reporting date, if the commodity prices increased/(decreased) by 10% and taking into account the commodity
hedges, with all other variables held constant, the Group’s post-tax profit would have changed as set out below:

2023 2022
(Decrease)/
Commodity Increase in Commodity increase
price profit price in profit
Commodity movement US$ million movement US$ million
Copper +10% 11.2 +10% (21.5)
Zinc +10% 7.2 +10% 0.3
Total 18.4 (21.2)

Commodity Decrease in Commodity Increase in

price profit price profit
Commodity movement US$ million movement US$ million
Copper -10% (10.9) -10% 21.8
Zinc -10% (7.2) -10% -
Total (18.1) 21.8

(b) Interest rate risk

The Group is exposed to interest rate risk primarily through interest bearing borrowings and investment of
surplus cash holdings. Deposits and borrowings at variable rates expose the Group to cash flow interest rate risk.
Deposits and borrowings at fixed rates expose the Group to fair value interest rate risk. Details of the Group’s
cash and cash equivalents have been disclosed in Note 22 while the details of the Group’s borrowings are set out
in Note 25.

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Notes to Consolidated Financial Statements

Continued

The Group regularly monitors its interest rate risk to ensure there are no undue exposures to significant interest
rate movements. Any decision to hedge interest rate risk is assessed periodically in light of the overall Group’s
exposure, the prevailing interest rate market and any funding counterparty requirements. Regular reporting of the
Group’s debt and interest rates is provided to the MMG Executive Committee.

The Group is exposed to the risk-free rate of SOFR. The exposures arise on derivative and non-derivative
financial assets and liabilities. The Group cash flow hedge relationship was affected by the interest rate
benchmark reform. With the IRS closure (Note 20), the cash flow hedge relationship was discontinued. The
current exposures mainly arise on non-derivative financial assets and liabilities. Interest rate benchmark
transition for non-derivative financial instruments is disclosed in Note 25.

The following table contains details of the cash flow hedge was affected by the IRS closure:

At 31 December 2023 and for Year Ended 31 December 2023

Amount reclassified from
Balance in cash flow the cash flow hedge Line item affected in
hedge reserve reserve to profit or loss profit or loss because
US$ million US$ million of the reclassification
Discontinued Cash Flow Hedges:
Financial cost,
Interest Rate Swap 40.2 37.0 Income tax expense

The following table contains details of the hedging instrument used in the Group’s hedging strategy as at
31 December 2022:

Favourable/(Unfavourable)
changes in fair value
used for measuring
ineffectiveness
Settled
portion of Hedge
hedging Hedging gain ineffective-
Carrying instrument recognised ness
Notional amount of realised in cash recognised
amortising hedging Hedging gains/ flow hedge in profit or
amount instrument instrument Hedged item (losses) reserve2 loss
Term US$ million US$ million US$ million US$ million US$ million US$ million US$ million
Cash flow hedges:

At 31 December 2022
Derivative financial June 2020 –
assets (Note 20)1 June 2025 1,560 113.9 82.1 (82.1) 17.9 55.8 -

1 In 2020, the Group has entered into a notional US$2,100 million 5-year amortising interest rate swap with BOC Sydney. Refer to Note 20 for further
details; and
2 The hedging gain recognised in cash flow hedge reserve is the amount after tax.

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Notes to Consolidated Financial Statements

Continued

At 31 December 2023 and 2022, if the interest rate had increased/(decreased) by 100 basis points, taking into
account the interest rate swap, with all other variables held constant, post-tax profit and other comprehensive
income (OCI) would have changed as follows:

2023 2022
+100 -100 +100 -100
basis points basis points basis points basis points
Increase/ (Decrease)/ Increase/ (Decrease)/
(decrease) increase (decrease) increase
in profit in profit in profit Increase in in profit Decrease
US$ million after tax after tax after tax OCI after tax in OCI
Financial assets
Cash and cash equivalents 3.0 (3.0) 2.5 - (2.5) -
Financial liabilities
Borrowings (taking into account
the impact of the interest rate
swap) (17.6) 17.6 (9.7) 13.6 9.7 (13.6)
Total (14.6) 14.6 (7.2) 13.6 7.2 (13.6)

(c) Foreign exchange risk

The Group operates internationally and is exposed to foreign currency exchange risk. The Group’s reporting
currency and functional currency of the majority of subsidiaries within the Group is US dollars. The majority of
revenue received by the Group is in US dollars. The Group’s foreign currency exchange risk arises predominantly
from the currency of the countries in which the Group’s operations are located. Any decision to hedge foreign
currency risk is assessed periodically in light of the Group’s exposure, the prevailing foreign currency market and
any funding counterparty requirements.

The following table shows the foreign currency risk arising from the monetary assets and liabilities, which are
shown by foreign currency of the Group.

US$ million Notes US$ PEN A$ HK$ Others Total

At 31 December 2023
Financial assets
Cash and cash equivalents 22 425.3 16.5 0.8 0.4 4.0 447.0
Trade receivables 19 354.8 - - - - 354.8
Other receivables 30.9 211.4 6.8 - 0.1 249.2
Derivative financial assets 20 3.1 - - - - 3.1
Other financial assets 21 2.7 - - - - 2.7
Financial liabilities
Trade and other payables 28 (459.3) (384.8) (52.0) - (6.8) (902.9)
Borrowings 25 (4,707.1) - - - - (4,707.1)
Lease liabilities 26 (118.8) (0.2) (28.6) - - (147.6)
(4,468.4) (157.1) (73.0) 0.4 (2.7) (4,700.8)

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US$ million Notes US$ PEN A$ HK$ Others Total

At 31 December 2022
Financial assets
Cash and cash equivalents 22 346.4 21.2 - 1.8 2.8 372.2
Trade receivables 19 212.7 - - - - 212.7
Other receivables 28.0 235.6 6.5 - - 270.1
Derivative financial assets 20 126.0 - - - - 126.0
Other financial assets 21 1.5 - - - 1.5
Financial liabilities
Trade and other payables 28 (333.2) (332.6) (62.1) - (25.1) (753.0)
Borrowings 25 (5,412.6) - - - - (5,412.6)
Lease liabilities 26 (114.0) (0.2) (24.5) - - (138.7)
Derivative financial
liabilities 20 (0.3) - - - - (0.3)
(5,145.5) (76.0) (80.1) 1.8 (22.3) (5,322.1)

Based on the Group’s net monetary assets and financial liabilities at 31 December 2023 and 2022, a movement
of the US dollar against the principal non-functional currencies as illustrated in the table below, with all other
variables held constant, would cause changes in post-tax profit as follows:

2023 2022
Weakening Strengthening Weakening Strengthening
of US dollar of US dollar of US dollar of US dollar
Decrease in profit Increase in Decrease in profit Increase in
US$ million after tax profit after tax after tax profit after tax
10% movement in Australian dollar (2022: 10%) (5.1) 5.1 (5.6) 5.6
10% movement in Peruvian sol (2022: 10%) (10.7) 10.7 (5.2) 5.2
Total (15.8) 15.8 (10.8) 10.8

(d) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the Group. The Group is exposed to counterparty credit risk through sales of metal products on normal
terms of trade, through deposits of cash and settlement risk on foreign exchange transactions. While the most
significant exposure to credit risk is through sales of metal products on normal terms of trade, the majority of
sales for mining operations were made under contractual arrangements whereby provisional payment is received
promptly after delivery and the balance within 30 to 120 days from delivery. The aging analysis of the trade
receivables is provided in Note 19, and 100% of the balance is aged less than 6 months based on invoice date.
The carrying amount of the Group’s trade receivables at FVTPL as disclosed in Note 19 best represents their
respective maximum exposure to credit risk. The Group holds no collateral over any of these balances.

Investments in cash, short-term deposits and similar assets are with approved counterparty banks.
Counterparties are assessed prior to, during and after the conclusion of transactions to ensure exposure to
credit risk is limited to acceptable levels. There has been no change in the estimation techniques or significant
assumptions made during the year ended 31 December 2023 in assessing the ECL for these financial assets. The
limits are set to minimise the concentration of risks and therefore mitigate the potential for financial loss through
counterparty failure. Impairment is provided for where the credit risk is perceived to exceed the acceptable levels
and there are concerns on recoverability of the relevant assets. The management of the Group considers cash

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and cash equivalents that are deposited with financial institutions with high credit rating to be low credit risk
financial assets.

Other receivables include balances related to various matters including other taxes, indemnities. These balances
are assessed at the reporting date considering contractual and non-contractual legal rights to receive such
amounts as well as the expectation of recoverability based on expert third party advice and management
assessment based on all available information. There are no significant increases in credit risk for these balances
since their initial recognition and the Group provided impairment based on a 12 month ECL. For the years ended
31 December 2023 and 2022, the Group assessed the ECL for these balances and considered no significant
impact to the consolidated financial statements.

The Group’s most significant customers are CMN, CITIC Metal Peru Investment Limited (CITIC Metal), and
Trafigura Pte Ltd (Trafigura). Revenue earned from these customers as a percentage of total revenue was:

2023 2022
CMN 46.6% 34.5%
CITIC Metal 20.2% 16.2%
Trafigura 8.2% 14.0%

The Group’s largest debtor at 31 December 2023 was CMN with a balance of US$159.1 million (2022: US$102.6
million) and the five largest debtors accounted for 77.6% (2022: 84.0% ) of the Group’s trade receivables. Credit
risk arising from sales to large concentrate customers is managed by contracts that stipulate a provisional
payment of at least 90% of the estimated value of each sale. For most sales a second provisional payment
is received within 60 days of the vessel arriving at the port of discharge. Final payment is recorded after
completion of the quotation period and assaying.

The credit risk by geographic region was:

At 31 December
US$ million 2023 2022
Asia 264.7 154.0
Europe 78.6 31.2
Australia 11.0 6.4
Other 0.5 21.1
354.8 212.7

(e) Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial
liabilities.

Management utilises short and long-term cash flow forecasts and other consolidated financial information to
ensure that appropriate liquidity buffers are maintained to support the Group’s activities.

The table below analyses the Group’s financial assets and liabilities into relevant maturity groupings based on the
remaining period at the reporting date to the contractual maturity date. The amounts disclosed in each maturity
grouping are the contractual undiscounted cash flows for financial instruments.

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Between Between Total

Within 1 1 and 2 2 and 5 Over carrying
US$ million year years years 5 years Total value
At 31 December 2023
Financial assets
Cash and cash equivalents (Note 22) 447.0 - - - 447.0 447.0
Trade receivables (Note 19) 354.8 - - - 354.8 354.8
Other receivables 93.4 150.7 5.1 - 249.2 249.2
Derivative financial assets (Note 20) 3.1 - - - 3.1 3.1
Other financial assets (Note 21) 2.7 - - - 2.7 2.7
Financial liabilities
Trade and other payables (Note 28) (616.4) (286.5) - - (902.9) (902.9)
Borrowings (including interest) (Note 25) (1,599.6) (1,285.1) (1,899.6) (824.3) (5,608.6) (4,707.1)
Lease liabilities (including interest) (Note 26) (33.9) (32.6) (66.0) (73.7) (206.2) (147.6)
(1,348.9) (1,453.5) (1,960.5) (898.0) (5,660.9) (4,700.8)
At 31 December 2022
Financial assets
Cash and cash equivalents (Note 22) 372.2 - - - 372.2 372.2
Trade receivables (Note 19) 212.7 - - - 212.7 212.7
Other receivables 114.7 145.5 9.9 - 270.1 270.1
Derivative financial assets (Note 20) 75.0 51.0 - - 126.0 126.0
Other financial assets (Note 21) 1.5 - - - 1.5 1.5
Financial liabilities
Trade and other payables (Note 28) (535.5) (217.5) - - (753.0) (753.0)
Derivative financial liabilities (Note 20) (0.3) - - - (0.3) (0.3)
Borrowings (including interest) (Note 25) (1,510.1) (1,357.8) (2,530.6) (1,090.5) (6,489.0) (5,412.6)
Lease liabilities (including interest) (Note 26) (32.7) (25.4) (59.6) (85.4) (203.1) (138.7)
(1,302.5) (1,404.2) (2,580.3) (1,175.9) (6,462.9) (5,322.1)

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Available debt facilities

As at the date that the financial statements are authorised to be issue, the Group (excluding the Las Bambas
Joint Venture Group) had available in its undrawn debt facilities an amount of US$3,350 million (31 December
2022: US$300.0 million). These include:

1. A new US$1,000.0 million RCF from Top Create was undrawn and available. It will expire in December 2026;

2. A new US$200.0 million RCF from China Construction Bank (“CCB”) of which US$50.0 million was undrawn
and available. It will expire in January 2027;

3. A new US$300.0 million Term Loan Facility from Top Create supporting KEP project was undrawn and
available. It will expire in December 2030; and

4. A new US$2,000.0 million shareholder term loan facility with Top Create to support an acquisition of CCL and
its subsidiaries (refer to Note 36 for more details) was undrawn and available.

As at the date that the financial statements are authorised to be issue, the Las Bambas Joint Venture Group had
available in its undrawn debt facilities of US$975.0 million (31 December 2022: US$800.0 million). These include:

1. A US$350.0 million RCF from Album Enterprises was undrawn and available. This facility was successfully
extended for 1 year and will expire in August 2024;

2. A new US$275.0 million RCF from BOC was undrawn and available. This facility will expire in April 2026;

3. A new US$150.0 million RCF from ICBC made up from three tranches of US$50.0 million each was undrawn
and available. This facility will expire in March, May and June 2026;

4. A new US$100.0 million RCF from CCB was undrawn and available. This facility will expire in February 2027;
and

5. A new US$100.0 million RCF from BOCOM was undrawn and available. This facility will expire in August 2026;
Note: The US$800.0 million revolving credit facility available at 31 December 2022 provided by China Development Bank, Bank of China, Bank of
Communications and The Export-Import Bank of China for operation and general corporate purposes was cancelled in September 2023.

The Group’s certain available external debt facilities are subject to covenant compliance requirements. The Group
was not in breach of covenant requirements in respect of the Group’s borrowings at 31 December 2023. Certain
financial covenants are measured with reference to the financial performance of the Group or its subsidiaries,
and may be influenced by future operational performance.

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31.2 Country and community risks

The Group conducts all of its operations outside of Hong Kong and, as such, it is exposed to various levels of
political, economic and other risks and uncertainties. These risks and uncertainties vary from country to country.
Material risks include, but are not limited to, regime or policy change, fluctuation in currency exchange rates,
changes to licensing regimes and amendments to concessions, licences, permits and contracts, changing
political conditions and governmental regulations and community disruptions. Changes in any aspects above
and in the country where the Group operates may adversely affect the Group’s operations and profitability. The
decline in growth and macroeconomic activity in many developing nations has resulted in governments seeking
alternative means of increasing their income, including increases to corporate tax, VAT and royalty rates, coupled
with increased audit and compliance activity.

The DRC Government during 2018 made changes to the 2002 Mining Code and Mining Regulations. These
changes were enacted (2018 Mining Code) and continue to result in an increased tax burden on mining
companies; In Peru, over the past decades, Las Bambas has experienced heightened political instability with
succession of regimes with differing political policies. As the community disruptions and political situation are
expected to evolve in the near future, the Group will continue to work closely with the relevant authorities
and community groups to minimise the potential risk of social instability and disruptions to the Las Bambas
operations.

Some of the countries in which the Group operates carry higher levels of sovereign risk. Political and
administrative changes and reforms in law, regulations or taxation may impact sovereign risk. Political and
administrative systems can be slow or uncertain and may result in risks to the Group including the ability to
obtain tax refunds in a timely manner. The Group has processes in place to monitor any impact on the Group and
implement responses to such changes.

31.3 Fair values of financial instruments

The fair values of cash and cash equivalents and short-term monetary financial assets and financial liabilities
approximate their carrying values. The fair values of other monetary financial assets and liabilities are either
based upon market prices, where a market exists, or have been determined by discounting the expected future
cash flows by the current interest rate for financial assets and financial liabilities with similar risk profiles.

The fair value of commodity derivatives is determined based on the discounted future cash flows. Future cash
flows are estimated based on forward commodity price from observable yield curves at the end of the reporting
period and contracted price, discounted by the current interest rate.

The fair values of listed equity investments have been valued by reference to market prices prevailing at the
reporting date.

The carrying values of other receivables less impairment provisions and trade payables are a reasonable
approximation of their fair values due to the short-term nature of trade receivables and payables. The fair values
of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the
current market interest rate that is available to the consolidated entity for similar financial instruments.

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The carrying amounts and fair values of financial assets and liabilities by category and class at 31 December
2023 and 2022 are:

Financial
assets/
(liabilities)
at fair value Amortised Total
Amortised through cost carrying Total fair
US$ million Notes cost (assets) profit or loss (liabilities) value value
At 31 December 2023
Financial assets
Cash and cash equivalents 22 447.0 - - 447.0 447.0
Trade receivables 19 - 354.8 - 354.8 354.8
Other receivables 249.2 - - 249.2 249.2
Derivative financial assets 20 - 3.1 - 3.1 3.1
Other financial assets 21 - 2.7 - 2.7 2.7
Financial liabilities
Trade and other payables 28 - - (902.9) (902.9) (902.9)
Borrowings 25 - - (4,707.1) (4,707.1) (4,850.1)
Lease liabilities 26 - - (147.6) (147.6) (147.6)
696.2 360.6 (5,757.6) (4,700.8) (4,843.8)

Financial Financial
assets/ assets at
(liabilities) fair value
at fair value designated Amortised Total
Amortised through under cash cost carrying Total fair
US$ million Notes cost (assets) profit or loss flow hedge (liabilities) value value
At 31 December 2022
Financial assets
Cash and cash equivalents 22 372.2 - - - 372.2 372.2
Trade receivables 19 - 212.7 - - 212.7 212.7
Other receivables 270.1 - - - 270.1 270.1
Derivative financial assets 20 - 12.1 113.9 - 126.0 126.0
Other financial assets 21 - 1.5 - 1.5 1.5
Financial liabilities
Trade and other payables 28 - - - (753.0) (753.0) (753.0)
Derivative financial liabilities 20 - (0.3) - - (0.3) (0.3)
Borrowings 25 - - - (5,412.6) (5,412.6) (5,533.6)
Lease liabilities 26 - - - (138.7) (138.7) (138.7)
642.3 226.0 113.9 (6,304.3) (5,322.1) (5,443.1)

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31.4 Fair value estimation

The table below analyses financial instruments carried at fair value, by the valuation method. The different levels
have been defined as follows:

• quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);
• inputs other than quoted prices included within level 1 that are observable for the asset or liability, either
directly (that is, as prices) or indirectly (that is, derived from prices) (level 2); and
• inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs)
(level 3).

The following table presents the Group’s financial assets and liabilities that are measured at fair value at 31
December 2023 and 31 December 2022.

US$ million Level 1 Level 2 Total

At 31 December 2023
Trade receivables (Note 19) - 354.8 354.8
Derivative financial assets (Note 20)
2
- 3.1 3.1
Financial assets at fair value through profit and loss – listed1 (Note 21) 2.7 - 2.7
2.7 357.9 360.6
At 31 December 2022
Trade receivables (Note 19) - 212.7 212.7
Derivative financial assets (Note 20)
2
- 126.0 126.0
Derivative financial liabilities (Note 20)
2
- (0.3) (0.3)
Financial assets at fair value through profit and loss – listed (Note 21)
1
1.5 - 1.5
1.5 338.4 339.9

There were no transfers between levels 1, 2 during the reporting period.

1 The fair values of financial instruments traded in active markets are based on quoted market prices at the reporting date. A market is regarded as
active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency,
and those prices represent actual and regularly occurring market transactions on an arm’s-length basis. Instruments included in level 1 comprise
investments in listed stock exchanges.
2 The fair value of the interest rate swap is determined based on discounted future cash flows. Future cash flows are estimated based on forward
interest rates from observable yield curves at the end of the reporting period and contracted interest rates, discounted at a rate that reflects the credit
risk of various counterparties. The fair value of the collar hedge and fixed price swap is determined based on discounted future cash flows. Future
cash flows are estimated based on London Metal Exchange contract future rates for commodities at the end of the reporting period and contracted
commodity prices, discounted at a rate that reflects the credit risk of various counterparties.

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31.5 Capital risk management

The Group’s objectives in managing capital are to safeguard its ability to continue as a going concern, support
sustainable growth, enhance shareholder value and provide capital for potential acquisitions and investment.

The gearing ratio for the Group is set out below, with gearing defined as net debt (total borrowings excluding
finance charge prepayments, less cash and cash equivalents) divided by the aggregate of net debt and total
equity.

2023 2022
The Group US$ million US$ million
Total borrowings (excluding prepaid finance charges)1 (Note 25) 4,748.1 5,456.9
Less: cash and cash equivalents (Note 22) (447.0) (372.2)
Net debt 4,301.1 5,084.7
Total equity 4,312.0 4,228.5
Net debt + Total equity 8,613.1 9,313.2
Gearing ratio 0.50 0.55

1 Borrowings at an MMG Group level reflect 100% of borrowings of the Las Bambas Joint Venture Group. The Las Bambas Joint Venture Group’s
borrowings have not been reduced to reflect the MMG Group’s 62.5% equity interest in that entity. This is consistent with the basis of preparation of
MMG’s financial statements.

Under the terms of relevant debt facilities held by the Group, the gearing ratio for covenant compliance purposes
is calculated exclusive of US$2,161.3 million (2022: US$2,161.3 million) of shareholder debt that was used to fund
the MMG Group’s equity contribution to the Las Bambas Joint Venture Group. For the purpose of the above, it
has however been included as borrowings.

32. Directors’ and Senior Management’s Emoluments

(a) Directors’ emoluments

The remuneration of every Director for the year ended 31 December 2023 is set out below:

For The Year Ended 31 December 2023

Short-term Long-term
incentive incentive
Fees Salaries Other benefits1 plans2 plans3 Total
Name of Director US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
Mr LI Liangang - 962 17 304 93 1,376
Mr XU Jiqing (Chairman) 6
- - 1 - - 1
Mr LEUNG Cheuk Yan 138 - - - - 138
Dr Peter William CASSIDY 144 - 1 - - 145
Mr ZHANG Shuqiang - - - - - -
Mr Peter Ka Keung CHAN 154 - 1 - - 155
436 962 20 304 93 1,815

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The remuneration of every Director for the year ended 31 December 2022 is set out below:

For The Year Ended 31 December 2022

Short-term Long-term
incentive incentive
Fees Salaries Other benefits1 plans2 plans3 Total
Name of Director US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
Mr LI Liangang4 - 985 22 266 236 1,509
Mr JIAO Jian (Chairman)5 - - 1 - - 1
Mr XU Jiqing 6
- - 1 - - 1
Mr LEUNG Cheuk Yan 145 - - - - 145
Dr Peter William CASSIDY 155 - 1 - - 156
Mr ZHANG Shuqiang - - 1 - - 1
Mr Peter Ka Keung CHAN 165 - 1 - - 166
465 985 27 266 236 1,979

1 Other benefits include statutory superannuation, pension contributions and non-monetary benefits. Not all benefits apply to each executive; benefits
are applied variably based on contractual obligations.
2 Short-term incentive (“STI”) plans include at-risk, performance-linked remuneration, STI plans and discretionary bonuses.
The STI plan is an annual cash award determined by performance against Group financial and safety targets and individual performance. For
operational roles, additional components include performance targets related to production rates, unit costs, and operational safety.
Participation in the at-risk incentive plans is offered to participants as a percentage of their fixed remuneration according to seniority and their ability
to influence the performance of the Group. All employees on long-term employment contracts are eligible to participate in a STI plan. The incentive
plans’ provision for STIs was re-assessed at the reporting date.
3 Long-term incentive (“LTI”) plans are performance-linked remuneration LTI plans, and most recently consist of the 2021 and 2022 Long-Term
Incentive Equity plans (“LTIEP”), which are Performance Awards Schemes vesting at the conclusion of a three year performance period, and the 2023
Performance Incentive Cash Award plan. The vesting of LTI plans is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant, including amongst others, achievement of financial, resources growth and market-related performance targets at the
conclusion of the respective vesting period.
Participation in the at-risk incentive plans is offered to participants as a percentage of their fixed remuneration according to seniority and their ability
to influence the performance of the Group. The LTI plans are limited to senior managers invited to participate by the Board. The incentive plans’
provision for LTI plans was re-assessed at the reporting date. The values attributed to the LTI plans are estimated values based on an assessment of
the likely outcomes for each LTI plans and may be adjusted based on the actual outcome. The values attributed to the LTI plans are subject to Board
approval at end of the vesting period.
4 Mr Li Liangang was appointed as the interim CEO and an Executive Director of the Company on 5 January 2022.
5 Mr. JIAO Jian resigned as the Chairman and Non-executive Director of the Company on 31 March 2023; and
6 Mr Xu Jiqing was appointed as the Chairman of the board on 21 August 2023.

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Continued

(b) Five highest-paid individuals

The five individuals whose emoluments were the highest in the Group for the year include one Director (2022:
one) whose emoluments are reflected in the analysis presented above and four (2022: four) senior executives
and senior management whose remuneration by band are set out in the “Senior management remuneration by
band” section in this Note.

Details of the emoluments payable to all five individuals during the year are as follows:

2023 2022
US$‘000 US$‘000
Salaries and other short-term employee benefits 3,551 3,662
Short-term incentives and discretionary bonus 1,641 1,547
Long-term incentives 536 521
Post-employment benefits 120 182
5,848 5,912

During the years ended 31 December 2023 and 2022, no emoluments were paid or payable by the Group to
the Directors or any of the five highest-paid individuals as an inducement to join or upon joining the Group or as
compensation for loss of office.

(c) Senior management remuneration by band

The emoluments fell within the following bands:

Number of Individuals
2023 2022
HK$4,000,001 - HK$4,500,000 (US$510,391- US$574,190) - 1
HK$6,000,001 - HK$6,500,000 (US$765,591 - US$829,390) 1 -
HK$6,500,001 - HK$7,000,000 (US$829,391- US$893,190) - 1
HK$7,000,001 - HK$7,500,000 (US$893,191 - US$956,990) 1 -
HK$8,000,001 - HK$8,500,000 (US$1,020,791 - US$1,084,580) 1 -
HK$9,000,001 - HK$9,500,000 (US$1,148,381-US$1,212,180) - 1
HK$10,500,001-HK$11,000,000 (US$1,339,781-US$1,403,580) 1 -
HK$11,500,001 - HK$12,000,000 (US$1,467,381-US$1,531,180) - 2
HK$12,000,001-HK$12,500,000 (US$1,531,181-US$1,594,980) 1 -
5 5

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Continued

33. Long-Term Incentive Plans

Share Option Scheme

Pursuant to share option scheme adopted at the extraordinary general meeting of the Company held on
26 March 2013 (2013 Share Option Scheme), options were granted to eligible participants under 2016 Options.
At 31 December 2023, there were no options outstanding granted under 2016 Options and the 2013 Share
Option Scheme has been expired.

During the year ended 31 December 2023, the movement in the number of options granted under the 2016
Share Option Scheme was as follows.

2016 Options

On 15 December 2016, the Company granted options to the eligible participants pursuant to the 2013 Share
Option Scheme (2016 Options). There were no options outstanding at 31 December 2023.

During the year ended 31 December 2023, the movements of the 2016 Options were as follows:

Number of Options
Category Exercise Balance at Granted Exercised Lapsed Balance at
and name of Date of price per Exercise 1 January during the during the during the 31 December
participant grant1 share (HK$) period2 2023 year year3 year4 2023
4 years
Employees 15 December after date
of the Group 2016 2.29 of vesting 3,261,984 - (3,158,983) (103,001) -

1 The closing price of the shares of the Company immediately before the date on which the options were granted on 15 December 2016 was
HK$2.25 per share.
2 The vesting and performance period of the options is three years from 1 January 2016 to 31 December 2018, with 60% of vested options exercisable
from 1 January 2019 and 40% of the vested options subject to a 12-month exercise deferral period, such options being exercisable after 1 January
2020. The vesting of options is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant
including, among others, achievement of resources growth and market-related performance targets during the vesting period. Options vest on a
percentage basis based on the target performance level achieved. Achievement of the Company and individual performance conditions have resulted
in 33.33% of the 2016 Options granted to participants vesting on 22 May 2019.
3 The weighted average closing price of the shares of the Company immediately before the date on which the options were exercised was HK$2.83
per share.
4 Options lapsed due to the expiry of the exercise period.

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During the year ended 31 December 2022, the movements of the 2016 Options were as follows:

Number of Options
Balance
Category Exercise Balance at Granted Exercised Lapsed at 31
and name of Date of price per Exercise 1 January during the during the during the December
participant grant1 share (HK$) period2,5 2022 year year3 year4 2022
4 years
Employees 15 December after date
of the Group 2016 2.29 of vesting 4,074,630 - (640,980) (171,666) 3,261,984

1 The closing price of the shares of the Company immediately before the date on which the options were granted on 15 December 2016 was HK$2.25
per share.
2 The vesting and performance period of the options is three years from 1 January 2016 to 31 December 2018, with 60% of vested options exercisable
from 1 January 2019 and 40% of the vested options subject to a 12-month exercise deferral period, such options being exercisable after 1 January
2020. The vesting of options is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant
including, among others, achievement of resources growth and market-related performance targets during the vesting period. Options vest on a
percentage basis based on the target performance level achieved. Achievement of the Company and individual performance conditions have resulted
in 33.33% of the 2016 Options granted to participants vesting on 22 May 2019.
3 The weighted average closing price of the shares of the Company immediately before the date on which the options were exercised was HK$3.08 per
share.
4 Options lapsed due to cessation of employment.
5 No options were cancelled during the year.

The estimated fair value of the options granted on 15 December 2016 was approximately US$0.1371 each,
estimated at the date of grant by using the Black-Scholes option-pricing model.

The value of the share options was subject to a number of assumptions and limitations of the option-pricing
model, including a risk-free interest rate, option price volatility, expected life of the option, market price of the
Company’s shares and expected dividend. The risk-free interest rate was 1.89%; the expected volatility used in
calculating the value of options was 40% and the expected dividend was assumed to be nil.

The validity period of the options is from the date of vesting until four years from 22 May 2019 to 22 May 2023.
The vesting and performance period of the options is three years from 1 January 2016 to 31 December 2018. If a
participant leaves employment before the expiry of the vesting period, the option will lapse unless the participant
leaves due to certain specific reasons including ill-health, injury or disability, retirement with the agreement of
the employer, redundancy, death, the participating employing company ceasing to be part of the Group and any
other reason, if the Board so decides.

Performance Awards (Shares)

Pursuant to the performance awards granted under the LTIEP, performance awards were granted to eligible
participants under 2020 Performance Awards, 2021 Performance Awards and 2022 Performance Awards.
At 31 December 2023, there were a total of 39,800,298 performance awards (2022: 91,110,744) outstanding
granted under the 2021 and 2022 Performance Awards, which represented approximately 0.46% (2022: 1.05%)
of the total number of issued shares of the Company at that date.

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Continued

2020 Performance Awards

On 29 April 2020, the Company granted performance awards to the eligible participants pursuant to the Long-
Term Incentive Equity Plan (2020 Performance Awards). There were no performance awards outstanding at
31 December 2023.

During the year ended 31 December 2023, the movements of the 2020 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name 1 January during the during the during the during the 31 December
of participant Date of grant1, 2 2023 year year year year3 2023
Director
LI Liangang 29 April 2020 2,295,115 - (764,962) - (1,530,153) -
Employees of the Group 29 April 2020 45,943,153 - (12,356,010) - (33,587,143) -
Total 48,238,268 - (13,120,972) - (35,117,296) -

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 29 April 2020 was HK$1.34 per share.
2 The vesting and performance period of the performance awards is three years from 1 January 2020 to 31 December 2022. The vesting of performance
awards is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant including, among others,
achievement of resources growth, financial and market-related performance targets during the vesting period. Performance awards vest on a
percentage basis based on the threshold and target performance levels achieved. Portions of the vested performance awards will be subject to
holding locks for various periods of up to two years after vesting. The performance awards are granted for nil cash consideration. Achievement
of the Company and Individual performance conditions have resulted in 33.33% of the 2020 Performance Awards granted to participants vesting
on 1 June 2023.
3 Performance awards lapsed due to non-achievement of some performance conditions during the vesting period and cessation of employment during the year.

During the year ended 31 December 2022, the movements of the 2020 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name 1 January during the during the during the during the 31 December
of participant Date of grant 1, 2 2022 year year year year3 2022
Directors
GAO Xiaoyu5 29 April 2020 12,130,042 - - - (12,130,042) -
LI Liangang 4
29 April 2020 2,295,115 - - - - 2,295,115
Employees of the Group 29 April 2020 49,148,035 - - - (3,204,882) 45,943,153
Total 63,573,192 - - - (15,334,924) 48,238,268

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 29 April 2020 was HK$1.34 per share.
2 The vesting and performance period of the performance awards is three years from 1 January 2020 to 31 December 2022. The time of vesting will
be on or around June 2023. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration .
3 Performance awards lapsed due to cessation of employment.
4 Mr Li Liangang was appointed as the interim CEO and Executive Director of the Company on 5 January 2022. He was granted 2,295,115 performance
awards on 29 April 2020.
5 Mr Gao Xiaoyu resigned as the CEO and Executive Director of the Company on 5 January 2022. His interests in the performance awards lapsed on the
same day.

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Continued

The performance awards are granted for nil cash consideration. The vesting of the performance awards will
be subject to the achievement by each participant of certain performance conditions, among other things,
independently assessed measures of achievement of non-market based conditions such as resources growth
and financial and market based conditions such as total shareholder return. Portions of the vested performance
awards will be subject to holding locks for various periods of up to two years after vesting.

The estimated fair value of the performance awards granted on 29 April 2020 was approximately US$0.1462
each, estimated at the date of grant by using Monte Carlo Simulations (for market based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk-free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 0.80%; the expected volatility used in calculating the value of performance awards was 60.29% and the
expected dividend was assumed to be nil.

During the year ended 31 December 2023, the Group reversed a share award expense of approximately US$0.8
million (2022: recognised a share award expense of approximately US$0.2 million) in relation to the 2020
Performance Awards.

2021 Performance Awards

On 21 June 2021, the Company granted performance awards to the eligible participants pursuant to the Long-
Term Incentive Equity Plan (2021 Performance Awards). There were 13,665,443 performance awards outstanding
at 31 December 2023, representing approximately 0.16% of the total number of issued shares of the Company at
that date.

During the year ended 31 December 2023, the movements of the 2021 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name Date of 1 January during the during the during the during the 31 December
of participant grant1, 2 2023 year year year year3 2023
Director
LI Liangang 21 June 2021 760,615 - - - - 760,615
Employees of the Group 21 June 2021 14,060,567 - - - (1,155,739) 12,904,828
Total 14,821,182 - - - (1,155,739) 13,665,443

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 21 June 2021 was HK$3.39 per
share.
2 The vesting and performance period of the performance awards is three years from 1 January 2021 to 31 December 2023. The time of vesting will
be on or around June 2024. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration .
3 Performance awards lapsed due to cessation of employment.

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Continued

During the year ended 31 December 2022, the movements of the 2021 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name Date of 1 January during the during the during the during the 31 December
of participant grant1, 2 2022 year year year year3 2022
Directors
GAO Xiaoyu5 21 June 2021 4,019,967 - - - (4,019,967) -
LI Liangang 4
21 June 2021 760,615 - - - - 760,615
Employees of the Group 21 June 2021 15,801,682 - - - (1,741,115) 14,060,567
Total 20,582,264 - - - (5,761,082) 14,821,182

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 21 June 2021 was HK$3.39 per
share.
2 The vesting and performance period of the performance awards is three years from 1 January 2021 to 31 December 2023. The time of vesting will
be on or around June 2024. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration .
3 Performance awards lapsed due to cessation of employment.
4 Mr Li Liangang was appointed as the interim CEO and Executive Director of the Company on 5 January 2022. He was granted 760,615 performance
awards on 21 June 2021.
5 Mr Gao Xiaoyu resigned as the CEO and Executive Director of the Company on 5 January 2022. His interests in the performance awards lapsed on the
same day.

The performance awards are granted for nil cash consideration. The vesting of the performance awards will
be subject to the achievement by each participant of certain performance conditions, among other things,
independently assessed measures of achievement of non-market based conditions such as resources growth
and financial and market based conditions such as total shareholder return. Portions of the vested performance
awards will be subject to holding locks for various periods of up to two years after vesting.

The estimated fair value of the performance awards granted on 21 June 2021 was approximately US$0.3928
each, estimated at the date of grant by using Monte Carlo Simulations (for market based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk-free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 0.45%; the expected volatility used in calculating the value of performance awards was 69.06% and the
expected dividend was assumed to be nil.

During the year ended 31 December 2023, the Group recognised a share award expense of approximately
US$0.1 million (2022: US$0.6 million) in relation to the 2021 Performance Awards.

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Continued

2022 Performance Awards

On 21 April 2022, the Company granted performance awards to the eligible participants pursuant to the Long-
Term Incentive Equity Plan (2022 Performance Awards). There were 26,134,855 performance awards outstanding
at 31 December 2023, representing approximately 0.30% of the total number of issued shares of the Company at
that date.

During the year ended 31 December 2023, the movements of the 2022 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name 1 January during the during the during the during the 31 December
of participant Date of grant1, 2 2023 year year year year3 2023
Director
LI Liangang 21 April 2022 1,249,244 - - - - 1,249,244
Employees of the Group 21 April 2022 26,802,050 - - - (1,916,439) 24,885,611
Total 28,051,294 - - - (1,916,439) 26,134,855

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 21 April 2022 was HK$3.50 per
share.
2 The vesting and performance period of the performance awards is three years from 1 January 2022 to 31 December 2024. The time of vesting will
be on or around June 2025. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration .
3 Performance awards lapsed due to cessation of employment.

During the year ended 31 December 2022, the movements of the 2022 Performance Awards were as follows:

Number of Performance Awards

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name 1 January during the during the during the during the 31 December
of participant Date of grant1, 2 2022 year year year year3 2022
Director
LI Liangang 21 April 2022 - 1,249,244 - - - 1,249,244
Employees of the Group 21 April 2022 - 28,633,414 - - (1,831,364) 26,802,050
Total - 29,882,658 - - (1,831,364) 28,051,294

1 The closing price of the shares of the Company immediately before the date on which the awards were granted on 21 April 2022 was HK$3.50 per
share.
2 The vesting and performance period of the performance awards is three years from 1 January 2022 to 31 December 2024. The time of vesting will
be on or around June 2025. The vesting of performance awards is conditional upon the achievement of certain performance conditions as set out in
the respective letters of grant including, among others, achievement of resources growth, financial and market-related performance targets during
the vesting period. Performance awards vest on a percentage basis based on the threshold and target performance levels achieved. Portions of the
vested performance awards will be subject to holding locks for various periods of up to two years after vesting. The performance awards are granted
for nil cash consideration .
3 Performance awards lapsed due to cessation of employment.

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Continued

The performance awards are granted for nil cash consideration. The vesting of the performance awards will
be subject to the achievement by each participant of certain performance conditions, among other things,
independently assessed measures of achievement of non-market based conditions such as resources growth
and financial and market based conditions such as total shareholder return. Portions of the vested performance
awards will be subject to holding locks for various periods of up to two years after vesting.

The estimated fair value of the performance awards granted on 21 April 2022 was approximately US$0.4114
each, estimated at the date of grant by using Monte Carlo Simulations (for market based conditions) and
reference to market price of the Company’s shares at the date of grant.

The value of the performance awards was subject to a number of assumptions and limitations of the
performance awards-pricing model, including a risk-free interest rate, price volatility, expected life of the
performance awards, market price of the Company’s shares and expected dividend. The risk-free interest rate
was 2.87%; the expected volatility used in calculating the value of performance awards was 68.26% and the
expected dividend was assumed to be nil.

During the year ended 31 December 2023, the Group reversed a share award expense of approximately
US$0.8 million (2022: recognise a share award expense of approximately US$3.2 million) in relation to the 2022
Performance Awards.

Performance Incentive Cash Award (Cash)

Pursuant to the Board approval, a performance incentive cash award was granted on 19 June 2023 to eligible
participants under the 2023 Performance Incentive Cash Award (“PICA”). The award requires the Company to
pay the intrinsic value of the PICA to the employees at the date of exercise. At 31 December 2023, there were a
total of 45,164,002 PICA (2022: nil) outstanding.

During the year ended 31 December 2023, the movement of PICA was as follows:

Number of Performance Incentive Cash Award

Vested and
Balances at Granted exercised Cancelled Lapsed Balance at
Category and name 1 January during the during the during the during the 31 December
of participant Date of grant1, 2 2023 year year year year3 2023
Directors
LI Liangang 19 June 2023 - 1,700,976 - - - 1,700,976
Employees of the Group 19 June 2023 - 45,777,105 - - (2,314,065) 43,463,040
Total - 47,478,081 - - (2,314,065 ) 45,164,016

1 The closing price of the shares of the Company immediately before the date on which the PICA were granted on 19 June 2023 was HK$2.60 per share.
2 The vesting and performance period of the PICA is three years from 1 January 2023 to 31 December 2025. The time of vesting will be on or around
June 2026. The vesting of PICA is conditional upon the achievement of certain performance conditions as set out in the respective letters of grant
including, among others, achievement of resources growth, financial and market-related performance targets during the vesting period. PICA vests on
a percentage basis based on the threshold and target performance levels achieved. PICA is granted for nil cash consideration .
3 PICA lapsed due to cessation of employment.

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Continued

The fair value of PICA was determined using Monte Carlo Simulations (for market based conditions) and
reference to market price of the Company’s shares at the date of each valuation date.

At 31 December 2023, the Group has recorded liabilities of approximately US$2.90 million (2022: nil). The value
of PICA was subject to a number of assumptions and limitations of the PICA pricing model, including a risk-free
interest rate, price volatility, expected life of the PICA, price multiplier, market price of the Company’s shares and
expected dividend. The risk-free interest rate was 4.31%; the expected volatility used in calculating the value of
PICA was 62.77% and the expected dividend was assumed to be nil.

During the year ended 31 December 2023, the Group recognised a cash-award expense of approximately
US$2.9 million (2022: nil) in relation to the PICA.

34. Commitments
Capital commitments

Commitments for capital expenditure contracted for at the reporting date but not recognised as liabilities, are set
out in the table below:

2023 2022
US$ million US$ million
Property, plant and equipment
Within one year 225.6 143.9
Over one year but not more than five years 119.8 127.6
345.4 271.5

Intangible assets
Within one year 1.9 2.7
Over one year but not more than five years 0.4 -
2.3 2.7

2023 2022
Aggregate US$ million US$ million
Property, plant and equipment and intangible assets
Contracted but not provided for 347.7 274.2

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Continued

35. Contingent Liabilities

Bank guarantees

Certain bank guarantees have been provided in connection with the operations of certain subsidiaries of the
Company primarily associated with the terms of mining leases, mining concessions, exploration licences or key
contracting arrangements. At the end of the reporting period, no material claims have been made under these
guarantees. The amount of these guarantees may vary from time to time depending upon the requirements
of the relevant regulatory authorities. At 31 December 2023, these guarantees amounted to US$310.5 million
(2022: US$297.5 million).

Contingent Liabilities – tax related contingencies

The Group has operations in multiple countries, each with its own taxation regime. The nature of the Group’s
activities requires it to comply with various taxation obligations including corporation tax, royalties, withholding
taxes, transfer pricing arrangements with related parties, resource and production-based taxes, environmental
taxes and employment related taxes. Application of tax laws and interpretation of tax laws may require
judgement to assess risk and estimate outcomes, particularly in relation to the application of income taxes and
withholding tax to the Group’s cross-border operations and transactions. The evaluation of tax risks considers
both assessments received and potential sources of challenge from tax authorities. Additionally, the Group is
currently subject to a range of audits and reviews by taxation authorities in Australia, Peru, Zambia and the DRC.
No disclosure of an estimate of financial effect of the subject matter has been made in the consolidated financial
statements as, in the opinion of the management, such disclosure may seriously prejudice the position of the
Group in dealing with these matters.

Tax matters with uncertain outcomes arise in the normal course of business and occur due to changes in tax
law, changes in interpretation of tax law, periodic challenges and disagreements with tax authorities, and legal
proceedings. The status of proceedings for such uncertain tax matters will impact the ability to determine the
potential exposure, and in some cases, it may not be possible to determine a range of possible outcomes,
including timing of resolution or determining a reliable estimate of the potential exposure.

Peru – Withholding Taxes (2014, 2015, 2016 and 2017)

Included within such uncertain tax matters are audits of the 2014, 2015, 2016 and 2017 tax periods for MLB in
relation to withholding taxes on interest and fees paid under certain loans, which were provided to MLB pursuant
to facility agreements entered into among MLB and a consortium of Chinese banks in connection with the
acquisition of the Las Bambas mine in 2014. MLB received assessment notices from the Peruvian tax authority
(National Superintendence of Tax Administration of Peru or “SUNAT”), which advised that, in its opinion, MLB
and the Chinese banks are related parties and thus a 30% withholding tax rate ought to be imposed rather than
the 4.99% applied. The assessments of omitted tax plus penalties and interest as at 31 December 2023 totalled
PEN2,069.5 million (approximately US$551.8 million) (31 December 2022: PEN2,015.1 million (approximately
US$527.5 million)).

In relation to these assessments, having received external legal and tax advice, the Group has formed the view
that the Company and its controlled entities are not related parties to Chinese banks under Peruvian tax law.
Additionally, the Peruvian tax law was amended (with effect from October 2017) to provide expressly that parties
are not related by being under state ownership for the purposes of withholding taxes. Las Bambas has appealed
the assessments issued by SUNAT in the Peru Tax Court and the pronouncement is pending. In parallel, MLB
filed an Amparo lawsuit to request a Constitutional Court the nullity of WHT Assessments due to the violation of
MLB’s constitutional rights in the issuance of SUNAT Assessments. Where MLB is not successful in rebutting or
appealing such challenge(s), this could result in significant additional tax liabilities.

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Continued

Peru –Income Taxes (2016 and 2017)

• Peru –2016 Income Tax

In January 2023, Las Bambas received assessment notices from SUNAT in connection with the 2016
income tax audit (2016 Income Tax Assessment). The assessment denied the deductions for all interest on
borrowings expensed during the 2016 tax year. This included the loans from Chinese banks where SUNAT
denied the interest deductions on the basis that the borrowings were from related parties and that the alleged
related party debt should be included in calculating Las Bambas’ related party ‘debt to equity’ ratio (the ‘thin
capitalisation’ threshold) which would then be breached. SUNAT also alleged that interest payable on the
shareholder loan from MMG Swiss Finance A.G. is non-deductible, due to the application of the “Causality
Principle” (i.e., the loan has no relevance to the income-producing activities of Las Bambas). Further, SUNAT
separately alleged that the accounting treatment of the merger of Peruvian entities (subsequent to the
acquisition of Las Bambas in 2014) should have resulted in a negative equity adjustment which would result in
Las Bambas having no equity for the purposes of calculating its thin capitalisation allowance. The Assessment
issued by SUNAT for tax, interest and penalties for the income tax year 2016 totalled PEN651.0 million
(approximately US$173.0 million) as at 31 December 2023.

On 27 July 2023, SUNAT confirmed that it had considered Las Bambas’ appeal against the Assessment and
concluded that the Assessment remains correct and valid. Las Bambas will appeal to the Peru Tax Court.

• Peru –2017 Income Tax

In August 2023, Las Bambas received assessment notices from SUNAT in connection with the 2017 income
tax audit (2017 Income Tax Assessment). Similar to the 2016 Income Tax Assessment, SUNAT has continued
to challenge Las Bambas’ treatment of interest expense in the 2017 tax year on the same basis as that
described above. Further, SUNAT has not recognised previous years’ tax losses, including 2014, 2015 and
2016 development costs (US$710 million). The Assessment for tax, interest and penalties for the income tax
year 2017 totalled PEN 3,610.4 million (approximately US$961.0 million) as at 30 November 2023. However,
on 30 November 2023 SUNAT issued Resolution No. 4070140000905 and declared the nullity of tax debt.
An updated Assessment for 2017 was received on 13 December 2023 and notified a tax debt of PEN 3,460.2
million (approximately US$924.0 million).

Regarding the above SUNAT interpretations, management strongly disagrees and is of the view that SUNAT has
disregarded all available evidence and independent opinions on the accounting treatment, submitted by Las
Bambas for consideration during the 2016 and 2017 income tax assessment process. Further, in not recognising
prior years’ tax losses, SUNAT has failed to acknowledge the Tax Court decisions in respect of development
costs for the 2012 and 2013 years which were ruled in MLB’s favour. The risk remains that this treatment will also
be applied for future income tax years.

Las Bambas has notified the Peru Government of a dispute pursuant to the Peru-Netherlands Bilateral
Investment Treaty (Treaty) and the Peru Government has confirmed its inability to resolve the dispute by way
of commercial negotiation. Las Bambas is currently evaluating its legal options to seek damages from the
Government of Peru for a number of breaches of the Treaty.

Considering the Las Bambas’ proposed appeals and advice from the Las Bambas’ tax and legal advisers, the
Group did not recognise a liability in its consolidated financial statements for any assessed amount. If Las
Bambas is unsuccessful in its challenge on the SUNAT assessments, this could result in significant liabilities
being recognised.

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Continued

36. Events After the End of the Reporting Period

Other than the matters outlined below, there have been no matters that have occurred subsequent to the
reporting date, which have significantly affected, or may significantly affect, the Group’s operations, results
or state of affairs in future years.

• On 20 November 2023, the Group entered into a Share Purchase Agreement with Cupric Canyon Capital L.P.,
The Ferreira Family Trust, Resource Capital Fund VII L.P., and the Missouri Local Government Employees’
Retirement System (“Sellers”). The Group has conditionally agreed to purchase the entire issued share capital
of Cuprous Capital Ltd (“CCL”) from the Sellers at a purchase price of US$1,875.0 million.

As at the date of this report, the acquisition had been approved by the Minister of Minerals and Energy
of Botswana; the Competition and Consumer Authority of Botswana; the State Administration for Market
Regulation of the People’s Republic of China (“PRC”) and the requisite majority of the relevant Shareholders
as required under the Listing Rules.

• The group obtained new RCFs of US$300.0 million from CCB of which US$150.0 million is undrawn.
Refer to Note 2.1(a) and Note31.1 (e) for more details.

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Continued

37. Company Statement of Financial Position, Reserves and Accumulated Losses

(a) Company Statement of Financial Position

At 31 December
2023 2022
Note US$ million US$ million
ASSETS
Non-current assets
Loans to a subsidiary 103.4 119.9
Interests in subsidiaries 2,420.7 2,487.4
2,524.1 2,607.3
Current assets
Other receivables 0.1 1.3
Cash and cash equivalents 0.7 1.9
0.8 3.2
Total assets 2,524.9 2,610.5

EQUITY
Share capital 3,224.6 3,220.5
Reserves and accumulated losses (b) (713.7) (614.7)
Total equity 2,510.9 2,605.8

LIABILITIES
Current liabilities
Other payables 0.2 0.1
Borrowings from a subsidiary 13.8 4.6
Total liabilities 14.0 4.7
Net current liabilities (13.2) (1.5)
Total equity and liabilities 2,524.9 2,610.5

LI Liangang XU Jiqing
Interim CEO and Executive Director Chairman of the Board and Non-Executive Director

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Notes to Consolidated Financial Statements

Continued

(b) Company reserves and accumulated losses

Share-based
Special capital payment Accumulated
US$ million reserve reserve losses Total
At 1 January 2022 9.4 8.9 (613.5) (595.2)
Loss for the year - - (20.5) (20.5)
Employee long-term incentives - 1.1 - 1.1
Employee share options exercised and vested - (0.1) - (0.1)
At 31 December 2022 9.4 9.9 (634.0) (614.7)
Loss for the year - - (94.6) (94.6)
Employee long-term incentives - (1.5) - (1.5)
Employee share options vested and exercised - (2.9) - (2.9)
Employee share options lapsed - (0.1) 0.1 -
At 31 December 2023 9.4 5.4 (728.5) (713.7)

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Five-year Financial Summary

US$ million 2023 2022 2021 2020 2019

Results – the Group
Revenue 4,346.5 3,254.2 4,255.0 3,033.7 3,011.6

EBITDA 1,461.9 1,535.4 2,725.4 1,379.7 1,461.5

EBIT 531.7 745.3 1,827.4 451.9 341.9

Finance income 24.3 15.0 5.4 1.9 11.2
Finance costs (366.4) (299.8) (329.0) (401.4) (523.1)
Profit/(loss) before income tax 189.6 460.5 1,503.8 52.4 (170.0)
Income tax expense (67.5) (217.0) (583.3) (46.8) (25.3)
Profit/(loss) for the year 122.1 243.5 920.5 5.6 (195.3)

Attributable to:
Equity holders of the Company 9.0 172.4 667.1 (64.7) (230.4)
Non-controlling interests 113.1 71.1 253.4 70.3 35.1
122.1 243.5 920.5 5.6 (195.3)

A summary of the Group results that relate to current operations involving the exploration for, and development
of mining projects, is presented below.

US$ million 2023 2022 2021 2020 2019

Results – current operations
EBIT 531.7 745.3 1,827.4 451.9 341.9
Significant non-recurring items - - - 150.0
Underlying EBIT 1
531.7 745.3 1,827.4 451.9 491.9

1 Underlying EBIT represents EBIT adjusted for significant non-recurring items (before tax). During the year ended 31 December 2019, the underlying
loss attributable to equity holders of the Company excludes non-recurring item relating to the impairment of Kinsevere assets of US$105.0 million
(post-tax).

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Five-year Financial Summary

Continued

US$ million 2023 2022 2021 2020 2019

Assets and liabilities – the Group
Property, plant and equipment 9,417.1 9,509.4 9,763.1 10,075.9 10,394.2
Right-of-use assets 118.1 111.2 104.6 122.8 140.6
Intangible assets 534.0 534.2 537.3 546.5 567.5
Inventories 504.5 994.8 682.9 492.7 488.6
Trade and other receivables 644.8 510.0 399.4 601.4 571.9
Cash and cash equivalents 447.0 372.2 1,255.3 192.7 217.5
Other financial assets 2.7 1.5 1.8 1.7 3.1
Derivative financial assets 3.1 126.0 32.7 - -
Current income tax assets 79.5 60.5 62.3 25.7 101.3
Deferred income tax assets 150.0 315.7 184.7 238.6 180.4
Total assets 11,900.8 12,535.5 13,024.1 12,298.0 12,665.1

Capital and reserves attributable to equity

holders of the Company 2,123.4 2,139.0 1,930.5 936.4 1,012.2
Non-controlling interests 2,188.6 2,089.5 1,997.5 1,733.3 1,665.7
Total equity 4,312.0 4,228.5 3,928.0 2,669.7 2,677.9

Borrowings 4,707.1 5,412.6 6,298.1 7,179.5 7,628.3

Lease liabilities 147.6 138.7 131.1 148.7 160.8
Trade and other payables 902.9 753.0 615.8 582.4 591.3
Derivative financial liabilities - 0.3 4.9 40.0 -
Other financial liabilities - - - 145.4 135.7
Current income tax liabilities 104.2 114.2 277.6 22.7 2.4
Provisions 774.3 680.2 749.8 644.4 588.7
Deferred income tax liabilities 952.7 1,208.0 1,018.8 865.2 880.0
Total liabilities 7,588.8 8,307.0 9,096.1 9,628.3 9,987.2
Total equity and liabilities 11,900.8 12,535.5 13,024.1 12,298.0 12,665.1

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Glossary

A$ Australian dollar, the lawful currency of Australia

AGM annual general meeting of the Company
Album Enterprises Album Enterprises Limited, a wholly owned subsidiary of CMN
associate(s) has the meaning ascribed to it under the Listing Rules
Australia The Commonwealth of Australia
Board the board of directors of the Company
Board Charter the board charter of the Company
BOC Sydney Bank of China Limited, Sydney Branch
BOCOM Bank of Communications Co., Ltd.
CCL Cuprous Capital Ltd, a company incorporated in British Columbia, Canada
CDB China Development Bank
CEO Chief Executive Officer
CFO Chief Financial Officer
China has the same meaning as PRC
CITIC CITIC Metal Peru Investment Limited
CMC China Minmetals Corporation, a state-owned enterprise incorporated under the laws of
the PRC
CMC Group CMC and its subsidiaries
CMCL China Minmetals Corporation Limited, a subsidiary of CMC
CMN China Minmetals Non-ferrous Metals Co., Ltd, a subsidiary of CMC
CMNH China Minmetals Non-ferrous Metals Holding Co., Ltd, a subsidiary of CMC
Company MMG Limited, a company incorporated in Hong Kong, the securities of which are listed
and traded on the Main Board of the Stock Exchange
Companies Ordinance the Companies Ordinance (Chapter 622 of the Laws of Hong Kong)
Director(s) the director(s) of the Company
DRC Democratic Republic of Congo
EBIT earnings before interest (net finance costs) and income tax
EBITDA earnings before interest (net finance costs), income tax, depreciation, amortisation and
impairment expense
EBITDA margin EBITDA divided by revenue
Executive Committee the executive committee of the Group, which consists of all Executive Directors
of the Company, Chief Executive Officer/Interim Chief Executive Officer, Chief
Financial Officer, Executive General Manager – Finance, Executive General Manager
– Commercial and Development, Executive General Manager – Corporate Relations,
Executive General Manager – Americas and Executive General Manager – Operations
EXIM Bank The Export-Import Bank of China
Group the Company and its subsidiaries
HK$ Hong Kong dollar, the lawful currency of Hong Kong

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Glossary
Continued

HKFRS Hong Kong Financial Reporting Standards, which include all applicable individual
Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (HKAS)
and interpretations issued by the Hong Kong Institute of Certified Public Accountants
(HKICPA)
Hong Kong the Hong Kong Special Administrative Region of the People’s Republic of China
Hong Kong Stock (please refer to the definition of ‘Stock Exchange’)
Exchange
ICBC Industrial and Commercial Bank of China Limited
ICBC Luxembourg Industrial and Commercial Bank of China Limited, Luxembourg Branch
ICBC Macau Industrial and Commercial Bank of China Limited, Macau Branch
ICMM International Council on Mining and Metals
JORC Code Joint Ore Reserves Committee ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves’
KEP Kinsevere Expansion Project
Las Bambas Project the development, construction and operation of the copper mines, processing facilities
and associated infrastructure at the Las Bambas copper project located in the
Apurimac region in Peru, together with all activities and infrastructure associated with
the transportation and export of products from such mines
Listing Rules the Rules Governing the Listing of Securities on the Stock Exchange
LME London Metal Exchange
MCC23 23rd Metallurgical Construction Group Co., Ltd, an indirect wholly owned subsidiary of CMC
Minerals and Metals the collective brand name of the portfolio of international mining assets held by Album
Group Resources Private Limited, a wholly owned subsidiary of the Company
Mineral Resources as defined under the JORC Code, a concentration or occurrence of material of intrinsic
economic interest in or on the Earth’s crust in such form, quality and quantity that there
are reasonable prospects for eventual economic extraction
Minmetals HK China Minmetals H.K. (Holdings) Limited, an indirectly owned subsidiary of CMC
Minmetals Logistics Minmetals Logistics Group Co., Ltd, a wholly owned subsidiary of CMC
Minmetals North- Minmetals North-Europe AB, a wholly owned subsidiary of CMC
Europe
MLB Minera Las Bambas S.A., a non wholly owned subsidiary of MMG and the owner of the
Las Bambas mine
MMG or MMG Limited has the same meaning as the Company
MMG Australia MMG Australia Limited, a wholly owned subsidiary of the Company
MMG Dugald River MMG Dugald River Pty Ltd, a wholly owned subsidiary of the Company
MMG Finance MMG Finance Limited, a wholly owned subsidiary of the Company
MMG SA MMG South America Company Limited, a wholly owned subsidiary of the Company
MMG SAM MMG South America Management Company Limited, a non wholly owned subsidiary of
the Company
Model Code Model Code for Securities Transactions by Directors of Listed Issuers as set out in
Appendix C3 of the Listing Rules

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Glossary
Continued

Ore Reserves as defined under the JORC Code, the economically mineable part of a Measured and /
or Indicated Mineral Resource
PRC the People’s Republic of China excluding, for the purpose of this document only, Hong
Kong, the Macao Special Administrative Region of the People’s Republic of China and
Taiwan, unless the context requires otherwise
RCF Revolving Credit Facilities
SFO the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
SDG Sustainable Development Goals
Share(s) fully paid ordinary share(s) of the Company
Shareholder(s) the shareholder(s) of the Company
SHEC Safety, Health, Environment and Community
Stock Exchange The Stock Exchange of Hong Kong Limited
SUNAT National Superintendence of Tax Administration of Peru
Top Create Top Create Resources Limited, a wholly owned subsidiary of CMN
TSF Tailings Storage Facilities
TRIF total recordable injury frequency per million hours worked
US$ United States dollar, the lawful currency of the United States of America
VAT value added tax

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Corporate
Information

Board of Directors General Counsel Registered Office

Chairman Nicholas MYERS Unit 1208, 12/F
XU Jiqing China Minmetals Tower
(Non-executive Director) Company Secretary
79 Chatham Road South
Executive Director WONG Lok Wun, Anfield Tsimshatsui
LI Liangang Kowloon
Legal Adviser Hong Kong
(Interim Chief Executive Officer)
Linklaters, Hong Kong Office and Principal Place
Non-executive Director
ZHANG Shuqiang Auditor of Business

Independent Non-executive Deloitte Touche Tohmatsu Hong Kong

Directors Registered Public Interest Unit 1208, 12/F
Peter CASSIDY Entity Auditor China Minmetals Tower
LEUNG Cheuk Yan 79 Chatham Road South
CHAN Ka Keung, Peter Share Registrar Tsimshatsui
Kowloon
Audit and Risk Management Computershare Hong Kong Investor
Hong Kong
Committee Services Limited
T +852 2216 9688
17th Floor Hopewell Centre
Chairman F +852 2840 0580
183 Queen’s Road East Wanchai
CHAN Ka Keung, Peter Australia
Hong Kong
Members Level 24
Principal Bankers 28 Freshwater Place Southbank
ZHANG Shuqiang
XU Jiqing China Development Bank Victoria 3006 Australia
T +61 3 9288 0888
Peter CASSIDY Industrial and Commercial Bank
F +61 3 9288 0800
LEUNG Cheuk Yan of China Limited
E [email protected]
Bank of China Limited
Governance, Remuneration,
The Export-Import Bank of China Website
Nomination and Sustainability
Bank of America Merrill Lynch Limited
Committee www.mmg.com
Australia and New Zealand Banking
Chairman Group Limited Share Listing
Peter CASSIDY Banco Bilbao Vizcaya Argentaria, S.A.
The Stock Exchange of
Members Investor and Media Enquiries Hong Kong Limited
XU Jiqing Stock Code: 1208
Jarod ESAM
LEUNG Cheuk Yan Head of Business Evaluation and
CHAN Ka Keung, Peter Additional Shareholder
Investor Relations
T +61 3 9288 9124 Information
Disclosure Committee
E [email protected] The Chinese version of the
Members Annual Report is prepared based
Andrea ATELL
LI Liangang Interim General Manager on the English version. If there is
Song QIAN Stakeholder Relations any inconsistency between the
Troy HEY T +61 3 9288 0758 English and Chinese versions of
Nicholas MYERS E [email protected] this Annual Report, the English
WONG Lok Wun, Anfield text shall prevail to the extent of
the inconsistency.

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