Ann: Continuous high-grade zones confirmed at Julimar, page-71

Macquarie's analyst's report on CHN today advised, among other things:

• We make modest adjustments to our earnings forecasts after incorporating the latest round of drilling results into our mining inventory assumptions. Our earnings forecasts are largely unchanged for FY21-FY26 while our price target falls 2% to A$9.50 due to a modest drop in contained metal in inventory. Variances in our mining inventory and project development scenario present the key risks to our base case earnings forecast and valuation for CHN.

Price catalyst

• 12-month price target: A$9.50 based on a 1.0x NPV methodology.

• Catalyst: Drilling updates from the Gonneville infill drilling program and securing access to the State Forest to enable drilling of Hartog present key near-term catalysts for CHN.

  Action and recommendation

• Maintain Outperform: Drilling results continue to impress with the G11 zone confirming the quality of the higher grade zones. Results have also confirmed extensions of the G3, G5 and G10 zones. We note that the G11 zone accounts for around 11% of our mining inventory assumption for Julimar, with the G3, G5 and G10 zones combined accounting for ~10%. Securing access to the State Forest to drill test the Hartog prospect presents a key near-term catalyst for CHN