Ann: High Grade Mineralisation West of Vardy, page-11

Aeon Metals Limited (AML) Drilling confirms PY3 open along strike Recommendation Buy (unchanged) Price $0.265 Valuation $0.34 (unchanged) Risk Speculative Analyst David Coates 612 8224 2887 Authorisation Peter Arden 613 9235 1833 GICS Sector Materials Expected Return Capital growth 28.3% Dividend yield 0.0% Total expected return 30.7% Company Data & Ratios Enterprise value $135.4m Market cap $106.1m Issued capital 400.4m Free float 79% Avg. daily val. (52wk) $72,845 12 month price range $0.13-$0.27 Price Performance . Page 1 (1m) (3m) (12m) Price (A$) 0.18 0.14 0.19 Absolute (%) 47.2 89.3 43.2 Rel market (%) 45.7 85.0 32.6 Strong copper and cobalt grades continue AML recently released further assays from its Phase II diamond drilling program at its 100%-owned Walford Creek copper-cobalt-zinc project. They are from hole WFDD266, drilled 250m to the west of the previously released hole WFDD265 and returned: 36m @ 1.24% Cu, 0.20% Co and 43g/t Ag from 275m; including 20m @ 1.86% Cu, 0.30% Co and 64g/t Ag from 288m. The positioning of this hole aligns with the western extremity of the Vardy Resource as it is currently defined and, as such, confirms that it and the targeted PY3 unit remains open along strike to the west. High confidence targeting paying off At the time this hole was drilled it represented the largest step-out on the PY3 following the use of the re-interpreted geological model to target the drilling. As such it was significant test of the model but again, targeting was successful, the model was validated and the high grades confirmed the visual logging of the PY3 in the diamond drill core. The intersection is also the most valuable from the latest program in terms of contained metal (width x grade) and further demonstrates the consistency of the PY3 unit. Again, the copper and cobalt grades are accretive to the current Resource and should contribute to an increase in tonnes and grade at the update in early CY18. Investment thesis – Buy, (Speculative), valuation $0.34/sh AML has entered an exciting period of discovery and growth, during which effective, cost efficient drilling could create significant value through exploration success. We point out that the latest drilling program has cost AML of the order of A$1.0m or less. Yet since the program commenced and assay results released, approximately $48m has been added to AML’s market capitalisation on strong indications of a material Resource upgrade. We retain our Buy (Speculative) recommendation and valuation of $0.34/sh.