EVOLUTION MINING LIMITED — Interim / Quarterly Report 2009

Mar 12, 2009

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Catalpa Resources Limited and its Controlled Entities

Half-Year Financial Report 31 December 2008

CATALPA RESOURCES LIMITED HALF- YEAR REPORT

TABLE OF CONTENTS

TABLE OF CONTENTS .............................................................................................................. ..2
DIRECTORS’ REPORT ................................................................................................................ 3
AUDITORS’ INDEPENDENCE DECLARATION .......................................................................... 8
CONDENSED INTERIM INCOME STATEMENT ......................................................................... 9
CONDENSED INTERIM BALANCE SHEET .............................................................................. 10
CONDENSED INTERIM CASH FLOW STATEMENT................................................................ 11
CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY .......................................... 12
1. CORPORATE INFORMATION ......................................................................................... 13
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES............................................... 13
3. FINANCIAL RISK MANAGEMENT .................................................................................. 15
4. REVENUE, INCOME AND EXPENSES............................................................................ 15
5. CASH AND CASH EQUIVALENTS .................................................................................. 16
6. SHARE BASED PAYMENT PLANS................................................................................. 16
7. COMMITMENTS AND CONTINGENCIES ....................................................................... 17
8. CONTRIBUTED EQUITY .................................................................................................. 17
9. EVENTS AFTER THE BALANCE SHEET DATE ............................................................ 18
DIRECTORS’S DECLARATION ................................................................................................. 19
INDEPENDENT AUDITOR’S REVIEW REPORT ...................................................................... 20

2

CATALPA RESOURCES LIMITED HALF-YEAR REPORT

DIRECTORS’ REPORT

Your directors submit their report for the half-year ended 31 December 2008.

DIRECTORS

The names of the Company’s directors in office during the half-year and until the date of this report are as below. Directors were in office for this entire period unless otherwise stated.

John Rowe (Non-Executive Chairman) Bruce McFadzean (Managing Director) Murray Pollock (Non-Executive Director) Barry Sullivan (Non-Executive Director)

Nigel Johnson (Non-Executive Director – appointed 20 August 2008)

Mr Johnson is a Chartered Accountant with strong finance and management experience attained over a period of 36 years working in a number of countries for both publicly listed and private companies within a number of industries.

• Mr Johnson has significant expertise in financial management, equity and debt raisings, treasury and financial risk management and strategic and business planning. Mr Johnson has arranged a number of equity and debt raisings in the last 10-15 years and his appointment to Catalpa’s Board has added significant financial expertise and provided valuable support for the financing of the Edna May Gold Project.

Chris Melloy (Non-Executive Director – resigned 12 December 2008)

Mr Melloy, an Executive Director of Lion Manager, was Lion Selection’s representative on the Catalpa Board since before the Company (formerly Westonia Mines Limited) listed on the ASX in August 2002. Mr Melloy’s resignation followed the appointment of Mr Barry Sullivan, presently a Non-Executive Director of Catalpa, to the Lion Board in November 2008, with Mr Sullivan remaining on the Catalpa Board as Lion’s representative.

REVIEW AND RESULTS OF OPERATIONS

Highlights

• Rebranding from Westonia Mines Limited to Catalpa Resources Limited

• 36% Increase in Gold Reserves

• Executive Appointments: Chief Financial Officer and General Manager Operations

• Progress of Edna May Underground Project

• Successful Completion of Rights Issue to Raise $3.5M Before Costs

• Edna May Open Pit Gold Project Feasibility Study Finalised

• Progress of Greenfinch Resource Drilling

Rebranding

On 3 September 2008 the Company changed its name from Westonia Mines Limited (ASX: WEZ) and formally commenced trading as Catalpa Resources Limited (“Catalpa”), on Australia Securities Exchange code CAH.

The rebranding was carried out to reflect the Company’s new focus on advancing its Edna May Gold Project to production, and was met with overwhelming shareholder approval.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

36% Increase in Gold Reserves

During the period under review, the Edna May JORC Reserve was increased by 194,000 ounces or 36% to 738,000 ounces Au, some 64% of which is in the highest confidence JORC Proven category.

The step increase in the Edna May Reserve resulted from the finalisation of the Edna May Gold Project Feasibility Study pit designs and schedules.

Executive Appointments

Catalpa made two appointments to its senior management team to ensure appropriate capacity to support the Company’s vision of utilising the favourable gold price environment to advance its Edna May Gold Project to production.

• Erik Palmbachs – Chief Financial Officer

Mr Erik Palmbachs was appointed as the Company’s Chief Financial Officer with effect from 20 October 2008. Mr Palmbachs is an experienced CFO and holds an MSc in Mineral Economics and a Bachelor of Business (Accounting). He is a member of the Australian Society of Accountants (AASA, CPA) and has an impressive resume with approximately 30 years hands-on experience, much of which was gained in the resources sector.

Mr Palmbachs was formerly the Chief Financial Officer at Territory Resources Limited, and his experience has already proven invaluable to Catalpa. In particular, Mr Palmbachs played an instrumental role in the successful Rights Issue undertaken in November 2008, the finalisation of the Edna May Gold Project Feasibility Study and more recently, in securing a $67.5 million financing facility for the Project through Macquarie Bank as announced on 4 March 2009.

• Stuart Pether – General Manager Operations

An executive search exercise carried out during the period under review resulted in the appointment of Mr Stuart Pether as the Company’s General Manager Operations with effect from 12 January 2009.

Mr Pether is an experienced Mining Engineer and holds a BEng (Mining) with an impressive resume of over 20 years hands-on and technical experience in the resources sector.

Mr Pether has worked in various operational, managerial, technical and corporate roles in Australia and Canada in his career, covering several commodities predominately in gold, nickel and zinc. Mr Pether is equally skilled in both open pit and underground mining environments.

Mr Pether’s experience is a valuable addition to the management team. His commitment is already evident in the initiative, insight and ownership he has demonstrated towards the Edna May Gold Project and the various preparations required ahead of the planned Project construction phase.

Edna May Underground Project

Between September and December 2008, Catalpa completed drilling of six holes of an 11-hole surface diamond drilling programme aimed at testing high grade underground reef structures at its Edna May Gold Project.

Visible gold was present in all six of the drill holes, with assay results confirming significant intercepts of quartz-sulphides and quartz 'stockworks' within the Edna May Gneiss, including Edna May Reef.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

The mounting geological evidence supports the interpretation of the continuation of the Edna May reef at depth; and the belief that Edna May is prospective for underground mining. The potential for underground mining in the future presents further upside for the already robust economics of the Edna May Gold Project.

A detailed geological review is being carried out on the data from the six completed holes and previous drill intercepts to determine the next stage of the programme.

Successful Rights Issue

On 3 December 2008, Catalpa closed a renounceable Rights Issue with strong support from its shareholders to raise $3.5 million before costs of the issue, to continue Catalpa’s ongoing drilling programmes and to provide for working capital to further expand on Reserves and to progress the Edna May Gold Project.

Edna May Open Pit Gold Project Feasibility Study Finalised

During the period under review, considerable management and Board attention was spent on finalising the Edna May Gold Project 2008 Feasibility Study.

The Feasibility Study findings announced in January 2009 demonstrate an economically robust project with a life-of-mine of 6.3 years at a conservative Australian gold price of A$1,200 per ounce.

The Project’s cash flow is robust, despite inflated feasibility study capital and operating cost estimates – a result of cost estimates being attained during the resources boom period in 2008. With the recent softening of the commodities sector and subsequent progress in the project procurement inquiries ahead of preparations for the planned construction phase, there are strong indications that cost savings may be realised against the original $92 million project budget.

The highlights of the Edna May Gold Project outlined in the 2008 Feasibility Study are as follows:

• 738,000 ounce Ore Reserve

• 676,000 ounces recoverable

• 64% (JORC) Proved Ore Reserve

• Processing 2.8 Mtpa ramping to 3.2 Mtpa from year three

• 6.3 year mine life excluding any additional ounces from the adjacent Greenfinch mineralisation

• Average annual production in excess of 100,000 ounces

• Cash operating costs pre 4.5% royalty of A$636 per ounce

• Conservative cash operating margin (post royalty) of $343 million at A$1,200 per ounce gold price

• Low waste:ore strip ration of 1.9:1.0 (post pre-strip)

• Metallurgically simple orebody and consistent recovery of ~92%

Subsequent to the reporting period, Catalpa has secured a project finance facility through Macquarie Bank, the details of which are outlined in Section 9 of this report. The terms agreed include a hedging facility, under which Catalpa has sold forward 352,316 ounces of gold at an achieved fixed flat forward price of A$1,544 per ounce, which is significantly higher than the Feasibility Study benchmark price of $1,200.

This historically high forward price significantly increases the Project’s cash operating margin from $54 million per annum as outlined in the Feasibility Study to $90 million per annum.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

Greenfinch Resource Drilling

Prior to the close of the reporting period, a step-out drill programme was planned at the Greenfinch mineralisation, aimed at extending the existing Greenfinch Resource adjacent to the Edna May Reserve at the Edna May Gold Project.

Early assay results from the 50-hole drill programme are encouraging with the discovery of several new gold mineralised zones in close proximity (700m) of the Edna May mineralisation. The holes assayed to-date have yielded several significant intercepts within the targeted host lithology, the Edna May Gneiss.

The results will be subject to further analysis and interpretation at the end of March once the balance of assay results are received, with an update of the Greenfinch Resource and Reserve on schedule to be completed in early April 2009.

The addition of new gold mineralised zones in such close proximity to the Edna May Gold Project is positive development that will further improve the economics of the Project and extend its current 6.3 year life-of-mine.

Operating Results

For the half-year ended 31 December 2008, the consolidated loss of the Group after providing for income tax is $3,265,268 (2007:$1,376,790).

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

AUDITOR’S INDEPENDENCE DECLARATION

We have obtained an independence declaration from our auditor’s, PKF Chartered Accountants, which is included on page 8.

Signed in accordance with a resolution of the directors

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Bruce McFadzean Managing Director 13 March 2009

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

AUDITORS’ INDEPENDENCE DECLARATION

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

CONDENSED INTERIM INCOME STATEMENT

FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

Notes Continuing Operations Revenue 4 Administrative costs Depreciation and amortisation expense Employee benefits expense and consulting fees Share-based payments Exploration and evaluation costs expensed as incurred Other expenses Loss from continuing operations before income tax Income tax benefit Loss from continuing operations after tax Net loss attributable to members of parent Earnings per share (cents per share) - Basic loss for the half-year - Diluted loss profit for the half-year	Consolidated 31 December 2008 31 December 2007 $ $
	76,185 145,962 (711,628) (413,482) (77,970) (66,713) (261,900) (337,561) (165,850) - (2,124,106) (725,195) - (221,296)
	(3,265,268) (1,618,285) - 241,495
	(3,265,268) (1,376,790)
	(3,265,268) (1,376,790)
	(0.89) (0.40) (0.89) (0.40)

The Condensed Consolidated Income Statement is to be read in conjunction with the notes to the Condensed Consolidated Financial Statements.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

CONDENSED INTERIM BALANCE SHEET AS AT 31 DECEMBER 2008

Notes	Consolidated 31 December 2008 30 June 2008 $ $
CURRENT ASSETS Cash and cash equivalents 5 Other receivables Other assets TOTAL CURRENT ASSETS NON CURRENT ASSETS Other financial assets Property, plant and equipment TOTAL NON CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Provisions TOTAL CURRENT LIABILITIES NON CURRENT LIABILITIES Interest-bearing liabilities TOTAL NON CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital 8 Reserves Accumulated losses TOTAL EQUITY	3,226,561 2,799,198 170,717 78,004 25,000 37,884
	3,422,278 2,915,086
	385,500 386,194 3,583,675 3,593,990
	3,969,175 3,980,184
	7,391,453 6,895,270
	454,350 158,066 498,232 462,208
	952,582 620,274
	61,244 -
	61,244 -
	1,013,826 620,274
	6,377,627 6,274,996
	36,178,393 32,976,344 666,483 500,633 (30,467,249) (27,201,981)
	6,377,627 6,274,996

The Condensed Consolidated Interim Balance Sheet is to be read in conjunction with the Notes to the Condensed Consolidated Financial Statements.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

CONDENSED INTERIM CASH FLOW STATEMENT FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

	Notes	Consolidated	Consolidated
		31 December	31 December
		2008	2007
		$	$
Cash from operating activities:
Research and development tax rebate		-	241,495
Other income		-	13,368
Interest received		91,342	129,057
Payments to suppliers and employees		(896,027)	(816,177)
Payments for mineral exploration and evaluation activities
includingrehabilitation		(1,968,915)	(1,287,591)
Net cash flows used inoperating activities		(2,773,600)	(1,719,848)
Cash flows from investing activities:
Payments for property, plant and equipment		(11,086)	(133,783)
Proceeds from tenement and performance bonds
recovered		-	1,500,000
Net cash provided (used in)/by investing activities		(11,086)	1,366,217
Cash flows from financing activities:
Proceeds from the issue of share capital		3,461,317	3,070,021
Cost of issue ofshare capital		(259,268)	(181,766)
Net cash provided by financing activities		3,202,049	2,888,255
Net increase in cash and cash equivalents		417,363	2,534,624
Cashand cashequivalents at the beginning ofthe period		2,809,198	1,075,686
Cash and cash equivalents at the end of the period	5	3,226,561	3,610,310

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

CONSOLIDATED	Employee Ordinary Benefits Accumulated Total Shares Reserve Losses Equity $ $ $ $
At 1 July 2007 Loss for the period Total income and expense for the period recognised directly in equity Contributed of equity Transaction costs At 31 December 2007	30,088,089 498,673 (24,910,243) 5,676,519
	- - (1,376,790) (1,376,790) - - (1,376,790) (1,376,790) 3,070,021 - - 3,070,021 (181,766) - - (181,766)
	32,976,344 498,673 (26,287,033) 7,187,984

CONSOLIDATED	Employee Ordinary Benefits Accumulated Total Shares Reserve Losses Equity $ $ $ $
At 1 July 2008 Loss for the period Total income and expense for the period recognised directly in equity Contributed of equity Transaction costs Share-based payment At 31 December 2008	32,976,344 500,633 (27,201,981) 6,274,996
	- - (3,265,268) (3,265,268) - - (3,265,268) (3,265,268) 3,461,316 - - 3,461,316 (259,267) - - (259,267) - 165,850 - 165,850
	36,178,393 666,483 (30,467,249) 6,377,627

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

1. CORPORATE INFORMATION

The Financial Report of Catalpa Resources Limited (the “Company”) for the half-year ended 31 December 2008 was authorised for issue in accordance with a resolution of the Directors on 9 March 2009.

Catalpa Resources Limited is a company incorporated in Australia and limited by shares which are publicly traded on the Australian Securities Exchange.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Half-Year Financial Report does not include all of the notes of the type normally included within the Annual Financial Report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report.

The Half-Year Financial Report should be read in conjunction with the Annual Financial Report of Catalpa Resources Limited as at 30 June 2008.

It is also recommended that the Half-Year Financial Report be considered together with any public announcements made by Catalpa Resources Limited and its controlled entities during the half-year ended 31 December 2008 in accordance with the continuous disclosure obligations arising under the Corporations Act 2001 .

(a) Basis of Preparation

The half-year consolidated financial report is a general purpose financial report, which has been prepared in accordance with the requirement of the Corporations Act 2001, applicable Accounting Standards, including AASB 134 “Interim Financial Reporting” and other mandatory professional reporting requirements. The Half-Year Financial Report has been prepared on a historical cost basis, except where stated.

For the purpose of preparing the Half-Year Financial Report, the half-year has been treated as a discrete reporting period.

(b) Significant Accounting Policies

The half-year consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 30 June 2008.

The following accounting policy has been adopted to recognise and measure the finance lease transaction:

Finance leases, which transfer to the Group substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the inception of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income. Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

(c) Basis of Consolidation

The half-year consolidated financial statements comprise the financial statements of Catalpa Resources Limited and its controlled subsidiaries (‘the Group’). The Group comprises of:

Entity Country of **Incorporation **	Extent of Parent's Interests
	31 December 2008 30 June 2008 31 December **2007 **
Catalpa Resources Ltd [Parent] Australia Westonia Mines Minerals Pty Ltd Australia	- - - 100% 100% 100%

(d) New Standards and Interpretations Not Yet Adopted

Certain Australian Accounting Standards and UIG interpretations have recently been issued or amended but are not yet effective. These standards have not been adopted by the entity for the half year ended 31 December 2008. Amendments issued affecting the entities are outlined below:

Title	Summary	Application Date	Impact on the Group
AASB 101: Presentation of Financial Statements	The revised standard affects the presentation of changes in equity and comprehensive income. It does not change the recognition, measurement or disclosure of specific transactions and other events required by other AASB standards. However, it is important to note that the AASB has decided that Australian issuers must make use in financial reports of the descriptions-Statement of Financial Performance and Position rather than Balance Sheet and Income Statement and use the term "Financial Report" and not "Financial Statement." The Amending Standard updates references in various other pronouncements.	Financial year beginning 1stJanuary 2009	AASB 101 affects disclosures in the Financial Report, rather than the measurement or recognition of financial items. The amendments to the standards will impact the Group’s Financial Report disclosures for the financial year ending 30 June 2010.
AASB 123: Borrowing Costs	This revision eliminates the option to expense borrowing costs on qualifying assets and requires that they be capitalised. The transitional provision provided allows for prospective application of this revision from either application date or adoption date if prior to 1 January 2009. The Amending Standard eliminates reference to the expensing option in various otherpronouncements.	Financial year beginning 1stJanuary 2009	Amendments to the standard would not have material impact on the Group, as the Group is currently not engaged in acquisition, construction or production of a qualifying asset noted in the standard.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

AASB 8: Operating Segments	This standard supersedes AASB 114, Segment Reporting introducing a US GAAP approach of management reporting as part of the convergence project with FASB. This standard only applies to entities that have public accountability therefore any entities that do not fall within scope may wish to early adopt and avoid segment reporting. The Amending Standard updates references in various otherpronouncements.	Financial year beginning 1stJanuary 2009	AASB 8 affects disclosures of segment reporting, rather than the measurement or recognition of financial items. The amendments to the standards will impact the Group’s Financial Report disclosures for the financial year ending 30 June 2010.

Amendments / revisions to other Accounting Standards and Interpretations do not have a material impact on the Group’s Financial Report, as the Group does not engage in activities / transactions affected by those amendments / revisions.

3. FINANCIAL RISK MANAGEMENT

The Group’s financial risk management objectives and policies are consistent with that disclosed in the consolidated financial report as at and for the year ended 30 June 2008.

	CONSOLIDATED	CONSOLIDATED
	December	December
	2008	2007
	$	$
4. REVENUE, INCOME AND EXPENSES
(a) Revenue, Income and Expenses from Continuing Operations
Revenue
Interest income	76,185	145,962
Total revenue	76,185	145,962
Other expenses
Depreciation	77,970	66,713
Exploration and evaluation costs expensed as incurred	2,124,106	725,195
Employee benefits expensed and consulting fees	261,900	337,561
Share-based payments	165,850	-

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

CONSOLIDATED	CONSOLIDATED
December	June
2008	2008
$	$

5. CASH AND CASH EQUIVALENTS

For the purposes of the half-year condensed cash flow statement, cash and cash equivalents are comprised of the following:

Cash at bank and in hand Short term deposits	3,226,561 2,799,198 - -
	3,226,561 2,799,198

6. SHARE BASED PAYMENT PLANS

In December 2008, 17,500,000 unlisted options were granted to senior executives and directors under the Employees and Contractors Option Plan. The details of the options are:

Options	Exercise	Expiry	Vesting Condition
	Price	Date
625,000	$0.06	23/12/2013	Vest immediately
3,750,000	$0.08	23/12/2013	Vest immediately
625,000	$0.08	23/12/2013	Exercisable upon completion of Board endorsed finance and
			funding package to commence construction of Edna May
			processplant
3,250,000	$0.10	23/12/2013	Exercisable upon completion of an update of the Feasibility
			Studyfor the Edna Mayopenpitproject
500,000	$0.10	23/12/2013	Exercisable upon achievement of a balanced Board composition
625,000	$0.10	23/12/2013	Exercisable upon the successful employment of the finance and
			accounting team and implementation of project construction and
			operatingcost managingsystem
3,750,000	$0.12	23/12/2013	Exercisable upon the completion of financing (both debt and
			equity)for the Edna Mayopenproject
625,000	$0.12	23/12/2013	Exercisable upon the successful commissioning of Edna May's
			openpitproject and the key parameters have been achieved
3,750,000	$0.14	23/12/2013	Exercisable upon the successful commissioning of Edna May's
			openpitproject and the key parameters have been achieved

The fair value of the options granted is estimated as at the date of grant using a Black Scholes model, taking into account the terms and conditions upon which the options were granted. The following table lists the inputs to the model used for the half-year ended 31 December 2008:

Expected volatility (%)	150
Risk-free interest rates(%)	4.25
Contractual life(years)	5

The estimated fair value of each option at grant date is approximately 2 cents.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

7. COMMITMENTS AND CONTINGENCIES

Lease Commitments

The Company has committed to an office lease of $105,893 per annum expiring 30 September 2010.

	CONSOLIDATED
	December December
	2008 2007
	$ $
0 to 1 year	105,893	-
1 to 5 years	81,340	-
Greaterthan5 years	-	-
Total	187,233	-

Finance Lease Commitments

The Company has committed to a car finance lease for a period of 36 months.

0 to 1 year	25,518	-
1 to 5 years	82,875	-
Greaterthan5 years	-	-
Total	108,393	-

Tenement Expenditure Commitments

The Group has a portfolio of tenements located in Western Australia which have a requirement for a certain level of expenditure each and every year in addition to annual rental payments for the tenements.

At 31 December 2008, annual expenditure commitments in respect of exploration assets amounted to $135,708. These mineral commitments are subject to provisions of legislation governing the granting of mineral exploration licences.

Since the last annual reporting date, there have been no material changes to any contingent liabilities or contingent assets.

8. CONTRIBUTED EQUITY

Ordinary shares (i)	CONSOLIDATED December 2008 June 2008 No No 518,168,935 345,377,313
	518,168,935 345,377,313

(i) Ordinary shares

Fully paid ordinary shares carry one vote per share and carry the right to dividends.

Movement in ordinary shares on issue At 30 June 2008 Conversion of listed options at $0.10 each Share placement at $0.02 each Transaction costs on share issue At 31 December 2008	CONSOLIDATED No $
	345,377,313 32,976,344 68,551 6,855 172,723,071 3,454,462 - (259,268)
	518,168,935 36,178,393

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT CONDENSED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2008

9. EVENTS AFTER THE BALANCE SHEET DATE

The Group has agreed the terms of a credit approved Project Finance Facility for the Edna May Gold Project.

The Facility which is underwritten by Macquarie Bank Limited provides substantial funding to the Edna May Gold Project development costs. The Facility comprises a secured loan of up to $55 million, a standby mezzanine facility of up to $10 million, a $2.5 million performance bond facility and a gold hedging facility. The term of the Facilities concludes in the 2015 financial year.

Under the hedging facility, Catalpa has sold forward 352,316 ounces of gold at an achieved fixed flat forward price of A$1,544 per ounce for delivery from commencement of operations, into the 2015 financial year.

In conjunction with entering into the project finance commitment, Catalpa has agreed to issue Macquarie Bank with options over fully paid ordinary shares in Catalpa. The number of options to be issued is equal to the amount provided under the mezzanine facility divided by the option exercise price (which will be set at a 25% premium to the price at which Catalpa issues shares under the equity component of the project funding). Half of the options are to be issued within two months with the balance to be issued following first draw down under the mezzanine facility (if required).

The provision of the Project Finance Facility is subject to a number of conditions precedents which are largely standard, and include the execution of full documentation and completion of an equity raising.

The Group has issued 5,000,000 options under the Employee and Contractors Option Plan following the appointment of a new General Manager of Operations on 12 January 2009.

No other matters or circumstances have arisen since the end of the half-year which have significantly affected or may significantly affect the operations or the state of affairs of the consolidated entity in the future financial years.

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

DIRECTORS’S DECLARATION

In accordance with a resolution of the directors of Catalpa Resources Limited, I state that:

In the opinion of the directors:

• (a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001 , including:

• i. give a true and fair view of the financial position as at 31 December 2008 and the performance for the half-year ended on that date of the consolidated entity; and

• ii. comply with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and

• (b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

On behalf of the Board

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Bruce McFadzean Managing Director 13 March 2009

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

INDEPENDENT AUDITOR’S REVIEW REPORT

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CATALPA RESOURCES LIMITED HALF-YEAR REPORT

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