IONIC RARE EARTHS LIMITED — Annual Report 2008

Aug 28, 2008

Appendix 4E Preliminary final report

APPENDIX 4E

Preliminary final report

EZENET LIMITED

ABN 84 083 646 477

1. Reporting Period

Year ended : 30 June 2008

2. Results for announcement to the market

2.1 Revenues from ordinary activities 2.2 Profit from ordinary activities after tax attributable to members 2.3 Net profit for the period attributable to members	up 21.34% to $4,053,034 up to $131,510 up to $131,510
2.4 Dividends	Amount per security	Franked amount per security
Final dividend	Nil¢	Nil¢
Previous corresponding year	Nil¢	Nil¢
2.5 Record date for determining entitlements to the dividend Not Applicable 2.6 Refer to the Company Announcement accompanying the Appendix 4E for explanations of the figures reported above.
	Not Applicable

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Appendix 4E Preliminary final report

3. Consolidated income statement

Note Continuing operations Revenue from ordinary sales 3.1(a) Cost of Sales 3.1(b) Gross Profit Other Income Marketing and distribution expenses Occupancy expenses Administrative expenses Borrowing expenses 3.1(c) Other operating expenses 3.1(d) Profit/(Loss) before income tax expense Income tax benefit/(expense) Profit/(Loss) after tax from continuing operations Net Profit (Loss) attributable to members of Ezenet Limited	2008 $	2007 $
	4,053,034 (1,028,769)	3,340,360 (896,812)
	3,024,265	2,443,548
	- (311,534) (86,265) (244,994) (236,723) (2,013,239)	- (449,727) (58,507) (298,833) (244,382) (1,568,037)
	131,510 -	(175,938) (90,962)
	131,510	(266,900)
	131,510	(266,900)

Earnings per security (EPS)	Cents	Cents
Basic earnings/(loss) per share Diluted earnings/(loss) per share	0.002 0.001	(0.003) (0.004)

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Appendix 4E Preliminary final report

3.1 Notes to the consolidated income statement

3.1(a) Other Operating Revenue Sale of Services Sale of equipment Interest received or receivable from other bodies corporate Revenue from ordinary sales 3.1(b) Cost of Sales Film Licenses and Movies Cost Installation Costs Cost of Equipment Cost of sales	2008 $	2007 $
	3,837,117 187,124 28,793	2,962,024 309,541 68,795
	4,053,034	3,340,360
	2008 $	2007 $
	897,732 31,496 99,541	666,064 96,007 134,741
	1,028,769	896,812
3.1(c) Borrowing Expenses Interest expense Other borrowing expenses	2008 $	2007 $
	236,723 -	175,943 68,439
Total borrowing costs Less borrowing costs capitalised	236,723 -	244,382 -
Total borrowing costs expensed	236,723	244,382

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Appendix 4E Preliminary final report

3.1 Notes to the consolidated income statement (cont.)

3.1(d) Other operating expenses Depreciation of plant and equipment Amortisation of film library Amortisation of Guest Video Film licence fees Installation costs Property, plant and equipment – written off Research & development Other expenses Operating lease rentals Defined contribution plan expense Provisions for employee entitlements Consultants and directors benefit expense Salaries & wages expense	2008 $	2007 $
	764,795 52,680 6,246 897,732 31,496 - - 260,290	570,549 50,598 18,754 666,064 96,007 1,421 7,800 156,844
	2,013,239	1,568,037
	78,962 70,560 20,230 61,250 720,077	53,739 63,527 29,359 75,000 792,070

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Appendix 4E Preliminary final report

4. Consolidated balance sheet

Current assets Cash Receivables Other Total current assets	2008 $	2007 $
	497,926 656,802 37,405	953,794 440,748 4,194
	1,192,133	1,398,736
Non-current assets Property, plant and equipment Intangible assets Deferred tax assets Available-for-sale financial assets Interest in associate Total non-current assets	3,167,187 102,899 930,059 5,843,763 -	2,550,693 106,594 939,894 9,320,449 -
	10,043,908	12,917,630
Total assets	11,236,041	14,316,366
Current liabilities Payables Interest bearing liabilities Tax liabilities Provision tax liabilities Provisions employee entitlements Total current liabilities	557,095 2,081,393 - 6,786 **53,952 **	527,026 1,748,665 - - 50,897
	2,699,226	2,326,588
Non-current liabilities Deferred tax liabilities Provisions employee entitlements Total non-current liabilities	1,685,488 11,613	2,760,008 14,400
	**1,697,101 **	2,774,408
Total liabilities	4,396,327	5,100,996
Net assets	6,839,714	9,215,370
Equity Contributed equity Reserves Retainedprofits	9,169,348 2,722,128 (5,051,762)	9,169,348 5,229,294 (5,183,272)
Equity attributable to members of the parent entity	6,839,714	9,215,370

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Appendix 4E Preliminary final report

5. Consolidated cash flow statement

Cash flows related to operating activities Receipts from customers Payments to suppliers and employees Interest and bill discount received Borrowing costs Income taxes paid Other Net operating cash flows	2008 $	2007 $
	3,664,151 (2,472,355) 32,195 (215,667) (295) (23,741)	3,175,633 (2,347,716) 68,795 (175,765) - -
	984,288	720,947
Cash flows related to investing activities Payments for property, plant and equipment Payments for purchase of businesses Payments for other non-current assets Payments for investments Net investing cash flows	(1,578,423) - - (105,000)	(1,267,377) (25,000) (46,575) (123,386)
	(1,683,423)	(1,462,338)
Cash flows related to financing activities Proceeds from issues of shares Proceeds from borrowings raised Repayment of borrowings: director’s loan other Other – Convertible notes repaid Net financing cash flows	- 390,710 - (97,443) (50,000)	1,234,448 475,000 (425,000) -
	**243,267 **	1,284,448
Net increase (decrease) in cash held Cash at beginning of financial year Effects of exchange rate changes on opening cash Cash at end of financial year	(455,868) 953,794 -	543,057 410,737 -
	497,926	953,794

O

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Appendix 4E Preliminary final report

5.1(a) Reconciliation of cash	5.1(a) Reconciliation of cash	5.1(a) Reconciliation of cash	2008 $	2007 $
Cash on hand and at bank Bank overdraft Total cash at end of period			497,926 -	953,794 -
			497,926	953,794
5.1(b) Reconciliation of loss from ordinary activities after income tax to net cash from operating activities			2008 $	2007 $
Profit/(Loss) from ordinary activities after income tax Depreciation and amortisation Provision for employee entitlements Property, plant and equipment written off Convertible note expense Consultants and directors benefit expense Employee share option expense Assets received for free Changes in assets and liabilities Receivables Payables Inventory Current tax liabilities Deferred tax liabilities Deferred tax assets Other debtors Net operating cash flows			131,510 823,721 20,230 - 14,452 - - - (216,054) 30,070 198,688 6,786 - 8,096 (33,211)	(266,900) 639,901 29,359 1,421 68,439 75,000 85,000 (30,240) (129,272) 98,437 - 90,963 - - 58,839
			984,288	720,947
5.1(c) Borrowing facilities and bank financial Accommodations	2008 $ Available	2008 $ Utilised	2007 $ Available	2007 $ Utilised
Convertible notes Bank loan Insurance finance Other	1,710,000 1,000,000 35,022 36,990	1,710,000 370,670 35,022 36,990	1,760,000 - 38,282 -	1,760,000 - 38,282 -
	2,782,012	**2,152,682 **	1,798,282	1,798,282

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Appendix 4E Preliminary final report

6. Dividends paid or declared

Dividends paid or declared for the year	2008 $	2007 $
	Nil	Nil
Amount of frankingcredits available	Nil	Nil

7. Dividend reinvestment plan

There is no Dividend Reinvestment Plan currently in place .

8. Movements in retained earnings

Retained losses at beginning of financial year Net operating profit (loss) after income tax for the financial year Adjustment arising from adoption of new and revised accounting standards: Dividendspaid orpayable	2008 $	2007 $
	(5,183,272) 131,510 - -	(4,916,372) (266,900) - -
**Retained losses at end of financial year **	(5,051,762)	(5,183,272)

9. NTA backing

Net tangible asset backing per ordinary security	2008	2007
	8.02 cents	10.85 cents

10. Control gained over entities having material effect

There were no material entities over which control was gained or lost by the Group during the financial year.

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Appendix 4E Preliminary final report

11. Available-for-sale financial assets

11. Available-for-sale financial assets
	2008 $	2007 $
Interest in WeatherlyInternationalplc	**5,498,391 **	8,847,134
Interest in Carbine Resources	150,000	360,000
Interest in Island Gas(previouslyknown as KP Renewablesplc)	90,372	113,314
Interest in Ghazal Uranium	105,000	-
Total Available for sale Assets	5,843,763	9,300,448

12. Details of associates and joint ventures

12. Details of associates and joint ventures
	2008 $	2007 $
	Ownership interest held by consolidated entity
Balance Date	2008	2007
E-Resources 30 June 2008	100%	100%
Ezestream 30 June 2008	100%	100%

13. Other significant information

13.1 Issued and quoted securities at end of current year

	Total number	Number quoted	Issue price per share $	Amount paid up per share $
Ordinary shares Balance on issue at 1 July 2007 Increases during current year - options exercised Balance on issue at 30 June 2008 Options	83,989,367	83,989,367
	- 83,989,367	- 83,989,367
			Exercise Price $
Balance on issue at 1 July2007	-	-
Issued during current year
Exercised during current year
Balance on issue at 30 June 2008	-	-

13.2 Changes in contingent liability

Not applicable

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Appendix 4E Preliminary final report

14. Accounting standards for foreign entities

Not applicable

15. Commentary on the results for the financial year

Refer to the Company Announcement lodged with the ASX on 28 July 2008.

15.1 Segment reporting – reports for business and geographical segments

The company operates in one geographical segment being Australia and in the one industry being the supply of digital movies, internet services and related equipment to the hospitality and mining industries.

16. Basis of preparation

The financial report complies with Australian Accounting Standards as issued by the Australian Accounting Standards Board and International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.

In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) and the Urgent Issues Group that are relevant to its operations and effective for annual reporting periods beginning on 1 July 2006. The adoption of these new and revised Standards and Interpretations did not have any effect on the financial position or performance of the Group.

Certain Australian Accounting Standards and UIG Interpretations have recently been issued or amended but are not yet effective and have not been adopted by the Group, for the annual reporting period ended 30 June 2008. The directors have not adopted any of these new or amended standards or interpretations.

17. Compliance statement

This report is based on accounts which are in the process of being audited.

(Original signed by Simon Watson)

Signed: ............................................................ Date: 29/08/2008_ (Company Secretary)

Name: Simon Watson

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