TRX GOLD Corp
For the period ended Aug 31, 2024. Filed Nov 29, 2024.
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The yearly report of certain Canadian companies, filed under a joint US and Canadian system. It is the main yearly account these companies give US investors, largely as filed in Canada.
FY2024 · Filed Nov 29, 2024
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Contents
EX-99.2 · Sensitivity analysis
Sensitivity analysis
If expected volatility, the significant unobservable input, had been higher or lower by 10% and all other variables were held constant, net income and net assets for the year ended August 31, 2024 would increase or decrease by:
| Schedule of net income and net assets | ||
|---|---|---|
| 10% change in expected volatilities | Increase | Decrease |
| (Loss) income | $(635) | $587 |
| b) | Gold zero-cost collars |
In March 2023, the Company entered into a series of gold zero-cost collar contracts for 1,800 gold ounces per month totalling 9,000 gold ounces to be settled from April 2023 to August 2023, at a maximum and minimum gold price of $2,030 and $1,825 per gold ounce, respectively.
In December 2023, the Company entered into a series of gold zero-cost collar contracts for 600 gold ounces per month for a total of 3,000 gold ounces to be settled from January 2024 to May 2024, at a maximum and minimum gold price of $2,150 and $1,850 per gold ounce, respectively.
During the year ended August 31, 2024, gold zero-cost collar contracts for a total of 1,200 gold ounces (2023 –9,000 gold ounces) expired unexercised and 1,800 gold ounces (2023 – nil) were exercised. As at August 31, 2024 and 2023, no gold zero-cost collar contracts were outstanding. For the year ended August 31, 2024, realized losses on exercised contracts amounted to $0.2 million (2023 - $nil).
| 13. | Provision for reclamation |
The Company's reclamation and closure obligations relates to the cost of removing and restoring the Buckreef Gold Project in Tanzania. Significant reclamation and closure activities include land rehabilitation, demolition of buildings and mine facilities, ongoing care and maintenance and other costs. This estimate depends on the development of an environmentally acceptable mine closure plan.
A reconciliation for reclamation expenses is as follows:
| Schedule of reconciliation for reclamation expenses | |
|---|---|
| For the year ended August 31, 2024 | |
| Balance at beginning of year | $833 |
| Increase in estimate for provision for reclamation | 486 |
| Change in discount rate | (336) |
| Accretion of provision for reclamation (Note 25) | 108 |
| Balance at end of year | $1,091 |
The provision for reclamation was estimated using the following inputs and assumptions:
| a) | Total undiscounted amount of future reclamation costs was estimated to be $5.7 million (2023 – $4.1 million). |
| b) | Risk-free rate of 15% (2023 – 13%). |
| c) | Inflation rate of 4% (2023 – 4%). |
| d) | Weighted average expected timing of cash outflows of 17 years (2023 – 19 years). |
| 14. | (Loss) earnings per share |
| Schedule of earnings loss per share | ||
|---|---|---|
| For the year ended August 31, | ||
| 2024 | 2023 | |
| Net (loss) income attributable to shareholders | $(470) | $2,250 |
| Weighted average number of common shares for basic EPS(1) | 289,618,686 | 282,401,603 |
| Effect of dilutive stock options, warrants, RSUs and share awards | - | 6,127,725 |
| Weighted average number of common shares for diluted EPS(1) | 289,618,686 | 288,529,328 |
| (1) | The weighted average number of common shares for basic and diluted EPS include 10.0 million gross number of vested, but unissued, common shares relating to common share awards. |
For the year ended August 31, 2024, the weighted average number of common shares for diluted EPS excluded 15.4 million stock options,1.5 million RSUs, and 36.2 million warrants that were anti-dilutive for the period (2023:10.5 million stock options and 39.0 million share warrants).
| 15. | Share Capital |
The Company’s authorized capital stock includes an unlimited number of common shares having no par value and preferred shares issuable in series (issued - nil).
| i) | Activity during the year ended August 31, 2023 |
On May 17, 2023, the Company sold 200,000 common shares in relation to the purchase agreement entered into on January 20, 2022, for $0.01 million.
| 16. | Share-based payments reserve |
| Schedule of share based payments reserve | ||
|---|---|---|
| For the year ended August 31, | ||
| 2024 | 2023 | |
| Balance at beginning of year | $8,807 | $6,825 |
| Share-based compensation expense | 2,018 | 2,697 |
| Transfer on exercise of options and other share-based awards | (1,674) | (715) |
| Balance at end of year | $9,151 | $8,807 |
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