Cannon Resources : Half-Year Financial Report - 31 December 2021

Corporate Directory

For shareholder information contact:

Share registry:

Automic Group

Level 2

267 St George's Terrace

Perth WA 6000

Stock exchange:

ASX Limited

Company code:

CNR (Fully Paid Shares)

Capital structure:

85,416,444 Fully paid ordinary shares

03,750,000 $0.30, 30 June 2024 options(1)

03,000,000 $0.30, 30 June 2024 options

09,583,207 $0.30, 30 July 2024 options

(1) Escrowed 24 months from quotation

For information on the Company contact:

Principal & registered office:

Level 2, 87 Colin Street

West Perth WA 6005

For personal use only

Directors' Report

Your Directors submit the financial report on Cannon Resources Limited ("the Company") for the half-year ended 31 December 2021.

Directors

The names of the Company's Directors in office during the financial period and until the date of this report are:

Mr Trevor Benson

Mr Alex Passmore

Mr Richard Bevan

Directors have been in office since the start of the financial period to the date of the report, unless otherwise stated.

Review of operations

The net loss after tax for the half-year ended 31 December 2021 was $3.5 million. This loss is predominantly attributable to expenditure on exploration and evaluation activities during the period totalling $3.0 million.

Projects

The Company has a suite of advanced nickel projects:

• Fisher East; and
• Collurabbie

All projects contain JORC mineral resource estimates and are located in Western Australia.

For personal use only

Fisher East

The Fisher East Nickel Project is located approximately 430km north of Kalgoorlie, 223km north of Leonora and 145km northeast of Leinster in the North-Eastern Goldfields region. The project consists of eleven granted exploration licences covering a total of 331km2.

The project contains three nickel sulphide deposits consisting of Camelwood, Cannonball and Musket. These deposits are typical Archean komatiite-associated deposits having affinities with Kambalda-style Type 1 contact ores.

During the half-ended 31 December 2021 the Company commenced a maiden exploration drilling program at Fisher East with the following assays subsequently received:

• 14.94m @ 1.90% nickel from 366.15m in hole MFED083;
• 4.94m @ 1.79% nickel from 559.77m in hole MFED084;
• 5.81m @ 2.29% nickel from 584.35m in hole MFED088;
• 5.67m @ 1.84% nickel from 584.35m in hole MFED095W1;
• 2.24m @ 1.86% nickel from 714.79m in hole MFED095; and
• 1.60m @ 2.03% nickel from 197.76m in hole MFED089.

All assays intersected extensions to nickel mineralisation at Musket, with mineralisation extended down dip by 230 metres beyond previous drilling. Musket nickel mineralisation remains open down dip and laterally to the north.

In addition a down-hole electromagnetic (DHEM) survey was completed with plates defining strong targets along the northern margin of the Musket channel.