LEGEND MINING LIMITED — Interim / Quarterly Report 2011

Sep 12, 2011

==> picture [496 x 108] intentionally omitted <==

HALF YEAR REPORT 30 JUNE 2011

ACN 060 966 145

COMPANY DIRECTORY

CONTENTS

	Page	Page
Company Directory		1
Directors‟ Report		2
Condensed Consolidated Statement of
Comprehensive Income		3
Condensed Consolidated Statement of Financial
Position		4
Condensed Consolidated Statement of Cash Flows		5
Condensed Consolidated Statement of Changes in
Equity		6
Notes to the Financial Statements		7
Director‟s Declaration	16
Declaration of Auditor Independence	17
Independent Auditor‟s Review Report	18

Directors

Michael William Atkins (Chairman) Mark William Wilson (Managing Director) Dermot Michael Ryan (Non-executive Director)

Company Secretary

Dennis Wilkins

Registered Office

Level 2 640 Murray Street PO Box 626 WEST PERTH, WA 6005

Telephone: (08) 9212 0600 Facsimile: (08) 9212 0611

Bankers

National Australia Bank 1232 Hay Street WEST PERTH, WA 6005

Auditors

Web

www.legendmining.com.au

Email

legend@legendmining.com.au

Stantons International Level 1, 1 Havelock Street WEST PERTH, WA 6005

Home Exchange

Australian Securities Exchange Ltd 2 The Esplanade PERTH WA 6000

ASX Codes

LEG – ordinary shares

Share Registry

Advanced Share Registry Services 150 Stirling Highway NEDLANDS, WA 6009

Telephone: (08) 9389 8033 Facsimile: (08) 9389 7871

Lawyers

Macdonald Legal Suite 23, 18 Stirling Highway NEDLANDS WA 6009

Legend Mining Limited Half-Year Report 2011

1

DIRECTORS’ REPORT

The Directors submit their report for the half-year ended 30 June 2011.

DIRECTORS & OFFICERS

The names and details of the Company‟s directors and officers during the financial period and until the date of this report are as below. Directors and officers were in office for this entire period unless otherwise stated.

Michael Atkins (Chairman, Non-Executive Director)

Mark Wilson (Managing Director)

Dermot Ryan (Non-Executive Director)

Dennis Wilkins (Company Secretary) (appointed 8 July 2011)

Anthony Walsh (Company Secretary) (resigned 8 July 2011)

Brett White (Company Secretary) (resigned 8 July 2011)

NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES

The principal activities during the period of the entities within the consolidated entity were exploration for iron ore, gold and base metal (zinc-copper-gold, nickel-copper, zinc-copper and copper-gold) deposits.

RESULTS OF OPERATIONS

The loss of the consolidated entity for the half-year after tax and non controlling interests was $2,966,790 (2010: profit $851,029) after income tax.

REVIEW OF OPERATIONS

1. Legend has continued exploring its 3 projects, Cameroon, Pilbara and Mt Gibson with the bulk of the exploration funds used in the Cameroon project. During this 6 month period Legend has spent in excess of $2.8 million on the development of the Cameroon Project to identify potential targets.

AUDITOR’S INDEPENDENCE

The Auditor‟s Independence Declaration under S307C of the Corporations Act 2001 has been received from Stantons International, the Company‟s auditor, and is available for review on page 17.

SIGNED in accordance with a Resolution of the Directors on behalf of the Board

==> picture [177 x 33] intentionally omitted <==

________ M Wilson Managing Director

Dated this 13 September 2011

Legend Mining Limited Half-Year Report 2011

2

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 30 JUNE 2011

Notes Continuing Operations Rental revenue 3(a) Finance revenue 3(b) Other income 3(c) Net gain/(loss) on revaluation of financial assets held for trading 3(g) Deferred exploration expenditure written off 3(e) Other expenses 3(f) Corporate expenses Finance costs Net profit / (loss) from continuing operations before income tax expense Income tax benefit/ (expense) Profit / (Loss) from continuing operations for the period Other comprehensive income Movement in foreign currency translation reserve Other comprehensive income for the year, net of tax Total comprehensive income / (loss) for the period Profit / (Loss) for the period attributable to: Members of Legend Mining Limited Non-controlling interest Comprehensive income / (loss) attributable to: Members of Legend Mining Limited Non-controlling interest PROFIT/(LOSS) PER SHARE (cents per share) Basic profit/(loss) for the period 4 Diluted profit/(loss) for the period 4	CONSOLIDATED As at 30-Jun-11 $ As at 30-Jun-10 $ 250,000 249,492 171,030 200,669 457,595 146,990 (2,412,667) (426,056) (978,359) (62,344) (375,216) (294,067) (1,058,973) (957,987) (19,059) (25,752)
	(3,965,649) (1,169,055) 1,010,272 279,554
	(2,955,377) (889,501)
	477,415 9,897
	477,415 9,897
	(2,477,962) (879,604)
	(2,966,790) (851,029) 11,413 (38,472)
	(2,955,377) (889,501)
	(2,489,375) (841,132) 11,413 (38,472)
	(2,477,962) (879,604)
	(0.1707) (0.0537) (0.1707) (0.0537)

The accompanying notes form part of these financial statements

Legend Mining Limited Half-Year Report 2011

3

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2011

Notes ASSETS Current Assets Cash and cash equivalents 6 Trade & other receivables Prepayments Other financial assets 7 Assets of disposal group classified as held for sale 8 Total Current Assets Non-current Assets Deferred tax asset Other financial assets 7 Property, plant & equipment 9 Deferred exploration costs 10 Mineral rights acquisition costs Total Non-current Assets TOTAL ASSETS LIABILITIES Current Liabilities Trade & other payables 11 Provisions – employees Total Current Liabilities Non-current Liabilities Provisions Deferred tax liability Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Equity attributable to equity holders of the parent Contributed equity 12 Reserves 13 Accumulated losses Total parent entity interest Non controlling interests TOTAL EQUITY	CONSOLIDATED As at 30-Jun-11 $ As at 31-Dec-10 $ 3,372,544 6,676,441 72,388 105,785 165,812 88,113 6,917,585 8,602,503
	10,528,329 15,472,842 2,093,110 497,944
	12,621,439 15,970,786
	1,095,358 1,111,563 1,548,256 1,548,061 863,668 725,014 10,884,260 10,649,056 23,253,764 23,253,764
	37,645,306 37,287,458
	50,266,745 53,258,244
	375,549 325,467 55,634 52,696
	431,183 378,163
	1,527,173 1,529,254 2,039,708 3,030,540
	3,566,881 4,559,794
	3,998,064 4,937,957
	46,268,681 48,320,287
	53,502,011 53,075,655 22,272,469 21,795,051 (29,376,334) (26,409,544)
	46,398,146 48,461,162 (129,465) (140,875)
	46,268,681 48,320,287

The accompanying notes form part of these financial statements

Legend Mining Limited Half-Year Report 2011

4

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 30 JUNE 2011

CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Interest paid Net cash flows used in operating activities CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant & equipment & scrap Proceeds from sale of investments Purchase of property, plant & equipment Purchase of investments Payment for exploration & evaluation Payment for performance bonds Dividends received Net cash flows from/ (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of ordinary shares Net cash flows from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of period Cash and cash equivalents at end of period	CONSOLIDATED 30-Jun-11 $ 30-Jun-10 $ 305,914 255,257 (784,846) (654,933) 165,934 200,856 (19,059) (25,752)
	(332,057) (224,572)
	166,055 32,828 - 871,297 (233,694) (226,892) - (1,222,056) (3,306,673) (1,704,871) (195) (997) 42,667 38,000
	(3,331,840) (2,212,691)
	360,000 3,180,000
	360,000 3,180,000
	(3,303,897) 742,737 6,676,441 5,437,937
	3,372,544 6,180,674

The accompanying notes form part of these financial statements

Legend Mining Limited Half-Year Report 2011

5

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 30 JUNE 2011

Consolidated At 1 January 2011 Loss for the period Other comprehensive income Total comprehensive loss for the period Issue of shares Cost of issue of share capital At 30 June 2011 At 1 January 2010 Loss for the period Other comprehensive income Total comprehensive loss for the period Acquisition of 90% of Camina Non-controlling interest acquired Share based payments Issue of shares Cost of issue of share capital At 30 June 2010	Issued Capital Foreign Currency Translation Reserve Share Option Premium Reserve Non controlling interests Accumulated Losses Total Equity $ $ $ $ $ $ 53,075,655 (514,624) 22,309,675 (140,875) (26,409,544) 48,320,287
	- - - 11,413 (2,966,790) (2,955,377) - 477,418 - (3) - 477,415
	- 477,418 - 11,410 (2,966,790) (2,477,962)
	462,000 - - - - 462,000 (35,644)* - - - - (35,644)
	53,502,011 (37,206) 22,309,675 (129,465) (29,376,334) 46,268,681
	38,420,414 - 10,545,911 - (27,673,309) 21,293,016
	- - - (38,472) (851,029) (889,501) - 9,897 - - - 9,897
	- 9,897 - (38,472) (851,029) (879,604)
	12,250,000 - 11,003,764 - - 23,253,764 - - - (1,236) - (1,236) - - 760,000 - - 760,000 3,360,000 - - - - 3,360,000 (919,115) - - - - (919,115)
	53,111,299 9,897 22,309,675 (39,708) (28,524,338) 46,866,825

• This is related to the movement in the deferred taxation cost on the capital raising costs

The accompanying notes form part of these financial statements

Legend Mining Limited Half-Year Report 2011

6

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 1: CORPORATE INFORMATION

The financial report of Legend Mining Limited (the Company) for the half-year ended 30 June 2011 was authorised for issue in accordance with a resolution of the Directors on 13 September 2011.

Legend Mining Limited is a company incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange.

The nature of the operations and principal activities of the Group are described in the Directors‟ Report.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The half-year financial report does not include all 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 Legend Mining Limited for the year ended 31 December 2010.

It is also recommended that the half-year financial report be considered together with any public announcements made by Legend Mining Limited and its controlled entities during the half-year ended 30 June 2011 in accordance with the continuance 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 requirements of the Corporations Act 2001 and AASB 134 Interim Financial Reporting and other mandatory professional reporting requirements. The half-year report has been prepared on a historical cost basis except for certain financial instruments which have been measured at fair value. Compliance with Australian Accounting Standards ensures that the financial statements and notes comply with International Financial Reporting Standards (“IFRS”).

The financial report is presented in Australian dollars and all values are expressed as whole dollars.

For the purpose of preparing the half-year financial report, the half-year has been treated as a discreet reporting period.

(b) Adoption of new and revised Accounting Standards

The Company has adopted all new and revised Australian Accounting Standards issued by the AASB which are mandatory to apply to the current interim period. Disclosures required by these Standards that are deemed material have been included in this financial report on the basis that they represent a significant change in information from that previously made available and are detailed below.

• AASB 5 Non-current Assets Held for Sale and Discontinued Operations: clarifies that the disclosures required in respect of non-current assets and disposal groups classified as held for sale or discontinued operations are only those set out in AASB 5. The disclosure requirements of other Accounting Standards only apply if specifically required for such non-current assets or discontinued operations.

• AASB 107 Statement of Cash Flows: States that only expenditure that results in recognising an asset can be classified as a cash flow from investing activities. This amendment will impact amongst others, the presentation in the statement of cash flows of the contingent consideration on the business combination completed in 2010 upon cash settlement.

Legend Mining Limited Half-Year Report 2011

7

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

• AASB 136 Impairment of Assets: The amendment clarifies that the largest unit permitted for allocating goodwill, acquired in a business combination, is the operating segment as defined in AASB 8 before aggregation for reporting purposes. The amendment has no impact on the Group as the annual impairment test is performed before aggregation.

• AASB Interpretation 17 Distribution of Non-cash Assets to Owners: This interpretation provides guidance on accounting for arrangements whereby an entity distributes non-cash assets to shareholders either as a distribution of reserves or as dividends. The interpretation has no effect on either, the financial position or the performance of the Group.

The Group has not elected to early adopt any other new Standards or amendments that are issued but not yet effective.

(c) 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 31 December 2010.

(d) Principles of Consolidation

The half-year consolidated financial statements comprise the financial statements of Legend Mining Limited and its subsidiaries as at 30 June 2011 („the Group‟).

The consolidated half year financial statements incorporate the assets, liabilities and results of entities controlled by Legend Mining Limited at reporting date („the Group‟). A controlled entity is any entity over which Legend Mining Limited has the power to govern the financial and operating policies so as to obtain benefits from its activities. Control will generally exist when the parent owns, directly or indirectly through subsidiaries, more than half of the voting power of an entity. In assessing the power to govern, the existence and effect of holdings of actual and potential voting rights are also considered.

Where controlled entities have entered or left the group during the period, the financial performance of those entities are included only for the period of the year that they were controlled.

In preparing the consolidated financial statements, all inter-group balances and transactions between entities in the consolidated group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by the parent entity.

Non-controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a parent, are shown separately within the Equity section of the consolidated Statement of Financial Position and Statement of Comprehensive Income. The non-controlling interest‟s interest in the net assets comprise their interests at the date of the original business combination and their share of changes in equity since that date.

(e) Estimates

The preparation of the interim financial report requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing this consolidated interim financial report, the significant judgements made by management in applying the consolidated entity‟s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial report as at and for the year ended 31 December 2010.

Legend Mining Limited Half-Year Report 2011

8

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

(f) Business Combinations

The purchase method of accounting is used to account for business combinations regardless of whether equity instruments or other assets are acquired. The cost of a business combination is measured as the fair value of the assets given, shares issued or liabilities incurred or assumed at the date of exchange and the amount of any non-controlling interest in the acquiree. For each business combination, the acquirer measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the acquiree's identifiable net assets. Acquisition-related costs are expensed as incurred.

Where equity instruments are issued in a business combination, the fair value of the instruments is their published market price as at the date of exchange unless, in rare circumstances, it can be demonstrated that the published price at the date of exchange is an unreliable indicator of fair value and that other evidence and valuation methods provide a more reliable measure of fair value.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any non-controlling interest. The excess of the cost of the business combination over the fair value of the Group‟s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets acquired, the difference is recognised directly in the Statement of Comprehensive Income, but only after a reassessment of the identification and measurement of the net assets acquired.

If the business combination is achieved in stages, the acquisition date fair value of the acquirer's previously held equity interest in the acquiree is remeasured at fair value as at the acquisition date through profit or loss.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value at the date of exchange. The discount rate used is the entity‟s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

NOTE 3: REVENUE AND EXPENSES	CONSOLIDATED	CONSOLIDATED
	30-Jun-11	30-Jun-10
	$	$
Revenues and expenses from continuing operations
a) Rental Revenue
Rental revenue	250,000	249,492
b) Finance Revenue
Bank interest received and receivable	171,030	200,669
c) Other Income
Profit on sale of plant & equipment	320,514	32,828
Sale of tenements	38,500	-
Profit on share trading	-	70,397
Dividends received	42,667	38,000
Office sublease	15,000	-
Field work completed by Legend geologists	40,914	5,765
	457,595	146,990
d) Employee Benefits Expense
Salaries & On costs	371,375	313,139
Other employee benefits	4,844	27,945
	376,219	341,084

Legend Mining Limited Half-Year Report 2011

9

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 3: REVENUE AND EXPENSES e) Deferred Exploration Expenditure written off Write off of deferred exploration expenditure f) Other Expenses Depreciation Foreign exchange loss Impairment of goodwill Rehabilitation expenses g) Net gain/(loss) on revaluation of Investments Fair value revaluation on Independence Group NL shares Fair value revaluation on Nemex Resources Limited shares Fair value revaluation on Pilbara Minerals Limited shares NOTE 4: LOSS PER SHARE (a) Earnings used in the calculation of basic earnings / (loss) per share Net profit/(loss) from continuing operations attributable to ordinary equity holders of Legend Mining Limited (b) Weighted average number of shares on issue during the financial period used in the calculation of basic earnings / (loss) per share Weighted average number of ordinary shares on issue used in the calculation of diluted earnings / (loss) per share	CONSOLIDATED 30-Jun-11 $ 30-Jun-10 $ 978,359 62,344 95,040 76,419 63,102 45,425 - 11,122 217,074 161,101
	375,216 294,067
	(2,474,667) (216,056) 132,000 - (70,000) (210,000)
	(2,412,667) (426,056)
	30-Jun-11 $ 30-Jun-10 $ (2,966,790) (851,029)
	1,738,205,773 1,655,041,409 1,738,205,773 1,655,041,409

The company has incurred a loss for the period and therefore the diluted loss per share is the same as the basic loss per share.

NOTE 5: SEGMENT INFORMATION

The Consolidated Entity operates in one operating segment and two geographical segments, being mineral exploration in Australia and West Africa. This is the basis on which internal reports are provided to the Directors for assessing performance and determining the allocation of resources within the Consolidated Entity.

Legend Mining Limited Half-Year Report 2011

10

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 5: SEGMENT INFORMATION (CONTD)

Primary Reporting – geographical segments

The geographical segments of the consolidated entity are as follows:

Revenue Segment Result Segment Assets Segment Liabilities	Australia West Africa Total June 2011 $ June 2010 $ June 2011 $ June 2010 $ June 2011 $ June 2010 $ 878,625 597,151 - - 878,625 597,151 (3,488,230) (491,688) (477,419) (397,813) (3,965,649) (889,501) 18,595,293 24,083,499 31,671,452 27,623,746 50,266,745 51,707,245 (3,829,901) (4,767,528) (168,163) (72,892) (3,998,064) (4,840,420)

Segment revenues and expenses are those directly attributable to the segments and include those expenses incurred by head office where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of cash and cash equivalents, receivables, property, plant and equipment, investments in listed entities and capitalised exploration. Segment liabilities consist principally of payables, employee benefits, accrued expenses and provisions.

NOTE 6: CASH AND EQUIVALENTS Cash at bank and in hand Short tem deposits Total cash and cash equivalents	Consolidated 30-Jun-11 $ 31-Dec-10 $ 2,372,544 2,676,441 1,000,000 4,000,000 3,372,544 6,676,441

NOTE 7: OTHER FINANCIAL ASSETS Current Shares in Independence Group NL at market value Shares in Pilbara Minerals Limited at market value Shares in Nemex Resources Limited at market value Non-current Performance and other bonds(a)	Consolidated 30-Jun-11 $ 31-Dec-10 $ 6,005,335 8,480,003 54,250 122,500 858,000 -
	6,917,585 8,602,503
	1,548,256 1,548,061

(a) Terms and conditions relating to the above financial instruments

• Non-Current Rehabilitation/Performance bonds – bank deposits were held as security for rehabilitation and credit cards, as a security deposit for the premises rented and as security for joint venture assets. These bonds were held for periods ranging from 90 days to 183 days at interest rates ranging from 1.5% to 5.05% per annum.

Legend Mining Limited Half-Year Report 2011

11

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 8:	ASSETS OF DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE	Consolidated	Consolidated
		30-Jun-11	31-Dec-10
		$	$
Exploration	and Evaluation Costs	2,093,110	497,944

On 30 August 2011 Legend announced its intention to sell Armada Mining Limited; its 100% owned subsidiary as well as the remaining tenements at its Pilbara project to Karratha Metals Limited (“KML”). The sale in conditional on KML successfully completing a capital raising and obtaining approval to list on the Australian Securities Exchange with the consideration being 10,000,000 fully paid ordinary shares in KML. The fair value of the shares has been estimated at $2 million. As a result, the carrying value of the Armada Mining Limited and the separate tenements at the Pilbara has been written down to $2 million at balance date.

On 4 April 2011 Legend signed an agreement with East Coast minerals to sell its interest in the Munni Munni Joint Venture for $1. In addition, Legend Mining Limited will receive the bonds which are held as security for the tenements relating to the Munni Munni Joint Venture. At 30 June 2011, the carrying value of these bonds was $93,110.and the carrying value of the tenements was $93,110.

As at 30 June 2011, $741,479 exploration expenditure has been written off the carrying values of the tenements to be sold relating to the Pilbara Project and Munni Munni Joint Venture.

NOTE 9: PROPERTY, PLANT AND EQUIPMENT Consolidated At 30 June 2011 Cost Accumulated depreciation Net carrying amount At 31 December 2010 Cost Accumulated depreciation Net carrying amount	Buildings $ Plant and equipment $ Total $ 556,665 1,132,638 1,689,303 (305,607) (520,028) (825,635)
	251,058 612,610 863,668
	457,606 1,036,300 1,493,906 (294,070) (474,822) (768,892)
	163,536 561,478 725,014

Legend Mining Limited Half-Year Report 2011

12

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 10: DEFERRED EXPLORATION COSTS Deferred exploration and evaluation Deferred mining information (a) Deferred exploration and evaluation costs At 1 January, at cost Expenditure incurred during the period Assets reclassified as held for sale Expenditure written off during the period At 30 June, at cost (i) (b) Deferred Mining Information At 1 January, at cost At 30 June, at cost (i)	Consolidated 6 months ended 30-Jun-11 $ 6 months ended 31-Dec-10 $ 9,211,757 8,976,553 1,672,503 1,672,503
	10,884,260 10,649,056
	30-Jun-11 $ 30-Jun-10 $ 8,976,553 6,245,930 3,306,673 1,704,871 (2,093,110) - (978,359) (62,344)
	9,211,757 7,888,457
	1,672,503 1,672,503
	1,672,503 1,672,503

Note :

• (i) Carrying values for certain tenements were reviewed and written off based on the following;

• (1) the carrying value of the Pilbara project was written down to the fair value of the expected consideration from the sale of Armada Mining and other Pilbara tenements;

• (2) the carrying value of the Munni Munni Joint Venture was written down to the valuation of the sale, being $1 plus the carrying value of the bonds ($93,109);

• (3) if no substantive expenditure for further exploration in the specific areas has been budgeted for and exploration for and evaluation of mineral resources in the specific area has not led to the discovery of commercially viable quantities of mineral resources then the carrying values of these tenements were written off.

• (ii) The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.

NOTE 11: TRADE AND OTHER PAYABLES Current – unsecured Trade payables Other payables & accruals	30-Jun-11 $ 31-Dec-10 $ 153,827 121,765 221,722 203,702
	375,549 325,467

Terms and conditions relating to the above financial instruments

• (i) Trade payables are non-interest bearing and normally settled on 30 day terms. (ii) Other payables are non-interest bearing and normally settled as they fall due.

Legend Mining Limited Half-Year Report 2011

13

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 12: CONTRIBUTED EQUITY

Consolidated and Company

Ordinary shares Issued and fully paid Issue costs Movement in ordinary shares on issue 2011 At 1 January 2011 Issued in period 7-January-11 Issue of shares on exercise of options 2-February-11 Issue of shares on exercise of options 8-March-11 Issue of shares pursuant to services rendered 6-April-11 Issue of shares on exercise of options 21-April-11 Issue of shares on exercise of options	30-Jun-11 $ 31-Dec-10 $ 56,173,385 55,711,385 (2,671,374) (2,635,730)
	53,502,011 53,075,655
	30-Jun-11 30-Jun-11 $ 1,729,350,801 55,711,385 5,000,000 200,000 2,500,000 100,000 2,000,000 102,000 1,250,000 50,000 250,000 10,000
	1,740,350,801 56,173,385

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

NOTE 13: RESERVES

Share Option Premium Reserve Foreign Exchange Translation Reserve	30-Jun-11 $ 31-Dec-10 $ 22,309,675 22,309,675 (37,206) (514,624)
	22,272,469 21,795,051

NOTE 14: RELATED PARTY DISCLOSURES

(i) Wholly-owned group transactions

Loans made by Legend Mining Limited to wholly-owned subsidiaries are repayable on demand and are not interest bearing.

(ii) Other related party transactions

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

(iii) Ultimate parent

Legend Mining Limited is the ultimate parent company.

(iv) Loans to related parties

Legend Mining Limited have advanced/ (received) the following loans to/ (from) its subsidiary companies during the half-year ended 30 June 2011.

	Half year ended	12 months ended
	30-Jun-11	31-Dec-10
	$	$
Gibson Metals Pty Ltd	42,779	278,121
Armada Mining Limited	10,649	49,293
Legend Cameroon Pty Ltd	-	(391,247)
Camina SA	2,791,167	6,968,646

Legend Mining Limited Half-Year Report 2011

14

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 30 JUNE 2011

NOTE 15: COMMITMENTS

(a) Exploration expenditure commitments.

In order to maintain current rights of tenure to exploration tenements, the Group will be required to outlay approximately $1,369,580 in the following 12 months, (previous 12 months: $2,611,180) in respect of tenement lease rentals and to meet minimum expenditure requirements of the Department of Mines & Petroleum. These obligations are expected to be fulfilled in the normal course of operations and have not been provided for in the financial report.

This is the maximum commitment to exploration, to fully meet DMP requirements. In practice, Legend has routinely applied for and been granted exemptions from meeting these requirements on a tenement by tenement basis. As a result the actual amount required to be expended on exploration is expected to be less than $1,369,580 while still holding all the tenements in good standing.

NOTE 16: CONTINGENT LIABILITIES

There has been no material change of any contingent liabilities during the half-year.

No other matters or circumstances have arisen since the end of the half-year to the date of this report which have significantly affected, or may significantly affect, the operations of the consolidated entity, the results of those operations or the state of affairs of the consolidated entity.

The consolidated entity‟s activities in Australia are subject to the Native Titles Act and the Department of Environment. Uncertainty associated with Native Title issues may impact on the consolidated entity‟s future plans.

There are no unresolved Native Title issues and the consolidated entity is not aware of any other matters that may impact upon its access to the land that comprises its project areas.

NOTE 17: EVENTS AFTER THE BALANCE SHEET DATE

As at close of business of the 9 September 2011 the valuation of the investments was as follows:

Independence Group NL $5.09 per share or a loss of $0.54 per share since 30 June 2011 representing a net loss before tax of $576,000.

Pilbara Minerals $0.033 per share or a gain of $0.002 per share since 30 June 2011 representing a net gain before tax of $3,500.

Nemex Resources $0.19 per share or a loss of $0.03 per share since 30 June 2011 and $0.07 per option or a loss of $0.01 per option since 30 June 2011 representing a net loss before tax of $115,500.

As at the date of this report there are no subsequent significant events after the balance date other than those described above.

NOTE 18: DIVIDENDS PAID AND PROPOSED

No dividends were paid or proposed this financial period.

There are no franking credits available for future reporting periods.

Legend Mining Limited Half-Year Report 2011

15

DIRECTORS’ DECLARATION

In accordance with a resolution of the directors of Legend Mining 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. Giving a true and fair view of the consolidated entity‟s financial position as at 30 June 2011 and its performance for the period ended on that date; and

• ii. Complying 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.

==> picture [177 x 32] intentionally omitted <==

---

Mark Wilson Managing Director

Dated this 13 September 2011

Legend Mining Limited Half-Year Report 2011

16

Stantons International Audit and Consulting Pty Ltd (ABN 84 144 581 519) trading as

Level 1, 1 Havelock St t: +61 8 9481 3188 West Perth WA 6005 f: +61 8 9321 1204 Australia PO Box 1908 w: www.stantons.com.au West Perth WA 6872 e: info@stantons.com.au Australia

e: info@stantons.com.au

==> picture [250 x 36] intentionally omitted <==

Chartered Accountants and Consultants

13 September 2011

Board of Directors Legend Mining Limited Level 2, 640 Murray Street WEST PERTH, WA 6005

Dear Directors

RE: LEGEND MINING LIMITED

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Legend Mining Limited.

As the Audit Review Director for the review of the financial statements of Legend Mining Limited for the half year ended 30 June 2011, I declare that to the best of my knowledge and belief, there have been no contraventions of:

• (i) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• (ii) any applicable code of professional conduct in relation to the review.

Yours faithfully

STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (Trading as Stantons International) (An Authorised Audit Company)

==> picture [139 x 35] intentionally omitted <==

J P Van Dieren Director

==> picture [176 x 31] intentionally omitted <==

17

Liability limited by a scheme approved under Professional Standards Legislation

Stantons International Audit and Consulting Pty Ltd (ABN 84 144 581 519) trading as

Level 1, 1 Havelock St t: +61 8 9481 3188 West Perth WA 6005 f: +61 8 9321 1204 Australia PO Box 1908 West Perth WA 6872 Australia

w: www.stantons.com.au

e: info@stantons.com.au

==> picture [250 x 36] intentionally omitted <==

Chartered Accountants and Consultants

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF LEGEND MINING LIMITED

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of Legend Mining Limited, which comprises the condensed statement of financial position as at 30 June 2011, the condensed statement of comprehensive income, condensed statement of changes in equity, and condensed statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration for Legend Mining Limited (“the consolidated entity”). The consolidated entity comprises both Legend Mining Limited (“the company”) and the entities it controlled during the half year.

Directors’ Responsibility for the Half-Year Financial Report

The directors of Legend Mining Limited are responsible for the preparation and fair presentation of the half-year financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001 and for such control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 30 June 2011 and its performance for the halfyear ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Legend Mining Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Whilst we considered the effectiveness of management’s internal controls over financial reporting when determining the nature and extent of our procedures, our review was not designed to provide assurance on internal controls.

Our review did not involve an analysis of the prudence of business decisions made by the directors or management.

==> picture [176 x 31] intentionally omitted <==

18

Liability limited by a scheme approved under Professional Standards Legislation

==> picture [121 x 18] intentionally omitted <==

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , has been provided to the directors of Legend Mining Limited on 13 September 2011.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Legend Mining Limited is not in accordance with the Corporations Act 2001 including:

• (a) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2011 and of its performance for the half-year ended on that date; and

• (b) complying with Accounting Standards AASB 134 Interim Financial Reporting and Corporations Regulations 2001.

STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (Trading as Stantons International) (An Authorised Audit Company)

==> picture [275 x 60] intentionally omitted <==

John P Van Dieren Director

West Perth, Western Australia 13 September 2011

19