MINREX RESOURCES LIMITED — Interim / Quarterly Report 2013

Mar 13, 2013

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MinRex Resources NL

ABN 81 151 185 867

FINANCIAL REPORT HALF-YEAR ENDED 31 DECEMBER 2012

MinRex Resources NL

CONTENTS	PAGE NO
Corporate Directory	1
Directors’ Report	2
Auditor’s Independence Declaration	10
Statement of Comprehensive Income	11
Statement of Financial Position	12
Statement of Cash Flows	13
Statement of Changes in Equity	14
Notes to the Financial Statements	15
Directors’ Declaration	17
Independent Audit Report	18

CORPORATE DIRECTORY

DIRECTORS

Mr Richard Procter (Non-executive Chairman) Mr Simon Durack (Non-executive Director) Mr Emmanuel Heyndrickx (Non-executive Director)

COMPANY SECRETARY

Mr Simon Durack

REGISTERED OFFICE

LinQ House Level 1 17 Ord Street West Perth WA 6005

Telephone: +61 8 9488 8888 Facsimile: +61 8 9481 0666 Website: www.minrex.com.au

SHARE REGISTRY

Security Transfer Registrars Pty Ltd 770 Canning Highway APPLECROSS WA 6153

Telephone: +61 8 9315 2333 Facsimile: +61 8 9315 2233

AUDITORS

Ernst & Young The Ernst & Young Building 11 Mounts Bay Road Perth WA 6000 Australia

STOCK EXCHANGE

Australian Securities Exchange Limited ASX Code: MRR

1

Directors’ Report

The Directors present their report for MinRex Resources NL (“MRR” or “the Company”) for the half-year ended 31 December 2012.

DIRECTORS

The following persons were Directors of MinRex Resources NL during the half-year and up to the date of this report:

Mr Richard Procter - BSc (Eng), MBA, MIMMM, CEng (Non-executive Chairman)

Mr Procter is a mining engineer with over 35 years broad international experience encompassing roles in the corporate, operations, contracting, consulting and mine development areas. He has held senior industry positions that have demonstrated leadership and management of base and precious metal mining companies (both underground and open pit); development of project assessment including definitive / bankable feasibility studies and their conversion into mining operations; He has managed teams undertaking mining asset evaluations and valuations, including technical and operational audits (full mining asset due diligence and expert reports). He also has been involved in many mining operation start-ups (both small and large) as well as the re-engineering of large ongoing operations.

Mr Simon Durack - BComm, Post Grad Dip Bus, FCA, FCIS (Non-Executive Director)

Mr Durack is a Chartered Accountant and practicing Company Secretary, with over 30 years commercial experience gained working in Australia, South East Asia and Europe. Mr Durack's commercial experience includes time worked in the Accounting profession with Coopers & Lybrand (now PricewaterhouseCoopers). He has also held many senior financial and secretarial roles with both large public and private entities. In these roles, Mr Durack has been responsible for providing managerial, secretarial and financial advisory input. Mr Durack has also acted as resident Director for several offshore companies with operations in Australia. Mr Durack brings a strong commercial and financial background to the Company.

Mr Emmanuel Heyndrickx – Business Economics (MSc), Masters Financial Management (Non-Executive Director)

Mr Heyndrickx is a financial consultant based in London. Mr Heyndrickx holds a degree in Business Economics (MSc) from the University of Ghent, Belgium, supplemented with a postgraduate Masters’ in Financial Management from the Vlerick Management School, Belgium. Mr Heyndrickx gained some 8 years of Corporate Finance experience with a number of European investment banks based in London (UK), most recently as a Vice-President with the Funds Advisory team at ING’s London Branch. During his time as a Corporate Financier, Mr Heyndrickx has lead and executed many public and private mandates both in the UK and in Europe including mergers and acquisitions, ECM (primary/secondary) placings, fund raisings and corporate restructurings. Mr Heyndrickx commenced his career with KPMG where he joined the Financial Services Sector Assurance team in London (UK), working as an external auditor for 4 years for a variety of world leading financial institutions such as HSBC, Deutsche Bank, Credit Suisse and Allianz. A native Dutch speaker, he is fluent in English, French and German.

COMPANY SECRETARY

Mr Simon Durack - BComm, Post Grad Dip Bus, FCA, FCIS – Appointed 28 February 2013 ( Refer to above biography )

Mr Pierre Malherbe – BCom(Acc), BCom (InvMgt), MCom - Resigned 28 February 2013

Mr Malherbe was appointed as Company Secretary on 3 August 2011. Mr Malherbe’s experience both in South Africa and Australia includes 24 years in the Investment Banking, Finance and Mining industries gained with some of the major banks in South Africa where he held senior financial and managerial positions within these Banks and was responsible for managerial, transactional and financial input across all spectrums, including: mining, construction, aviation and other capital intensive projects as well as senior management positions within mining and financial industries in Australia. Mr Malherbe resigned on 28 February 2013.

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Directors’ Report

PRINCIPAL ACTIVITY

The principal activity of the Company is mineral exploration and development.

REVIEW OF OPERATIONS

Corporate

MinRex Resources NL was incorporated in May 2011 and listed on the ASX on 7 November 2011. An Initial Public Offering for 17, 500,000 shares was made at $0.20/share, raising a total of $3.5 million.

Operating Results

The Company’s net loss attributable to the members of MinRex Resources NL for the six months ended 31 December 2012 was $149,977 (30/11/2011: $301,645). As at the end of the quarter, the Company had $2.75 million in cash.

Operations

The Company currently has two principal projects in its exploration portfolio – Deflector Extended Gold Project in Western Australia and Heemskirk Tin Project in Tasmania. These projects provide MinRex with a base from which to explore two highly prospective areas of Australia. Significantly, Mutiny Gold Limited is developing its Deflector Project about 3.5 km southwest of MinRex’s Western Australian leases. The Company has no current offshore exploration tenements.

Deflector Extended Gold Project

This project area (E59/1657) was originally selected based on its proximity to and alignment with, north-eastern extensions of the Deflector mineralisation trend (Figure 1), which hosts Mutiny Gold Ltd’s Gullewa Gold Project. Aeromagnetic survey data confirms the presence of the Gearless Well intrusion which extends into the southern sections of the tenement. This granite exhibits a strong spatial association with the Deflector and Golden Stream gold-copper deposits, which occur on the western contact of the intrusion and are coincident with a series of crosscutting northeast - southwest trending faults.

Exploration Program

The Company retained Pathfinder Exploration Pty Ltd (Pathfinder) to carry out an initial surface exploration geochemical program across the lease. This included collection of 187 auger soil and MAGLAG samples, from 10 m x 400 m east-west traverse lines with variable 100 m - 200 m sampling stations (Figure 2). While drill access was reasonable, scrub and unfavourable topography restricted sampling in some locations.

Depending on ground conditions and prospectivity, 2 kg auger samples were taken at an average of 1.7 m in depth. Where developed, base of calcrete samples were preferentially collected, together with weathered saprolite or bedrock. ICP-OES analysis was completed on aqua regia digests for Au, Ag, As, Cu, Mo, Ni and W by Ultratrace Geoanalytical Laboratories. Coincident MAGLAG samples were collected and analysed using a portable handheld (Niton) X-Ray Fluorescence spectrometer.

3

Directors’ Report

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Figure 1: Deflector Extended Prospect – Mineralisation / Structural Trends

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Figure 2: Deflector Extended Prospect - Auger + MAGLAG sample locations

Auger Soil Samples – Key Analytical Results

Gold

An irregular Au response was observed in the vicinity of the Deflector structural corridor in the northern sections of the lease, with samples peaking at 17 ppb Au in areas to its immediate west (Figure 3). A larger halo appears downslope from the Cagacaroon Hills, comprising samples assaying up to 12 ppb Au, coincident with a central, northeast-southwest structural lineament. In southern tenement areas, a separate and diffuse Au trend with multiple 7 ppb Au assays was detected, broadly concurrent with a third northeast-southwest trending structure.

4

Directors’ Report

Arsenic

Peak As values were observed in the vicinity of the Deflector structure with assays up to 152 ppm and local enrichment traced over a strike length of ~1400 m (Figure 4). Elevated As values were also detected along the northern contact of

Gearless Well granite and its flanking northeast-southwest trending structure. Generally broad As enrichment in soil is confirmed by overlapping trends within the MAGLAG dataset.

Copper

An elevated Cu signature is observed in the Deflector structural trend, with peak concentrations of 327 ppm defined. Extensive Cu dispersion is observed across both central and southern lineaments, whilst weaker in downslope areas from the Cagacaroon Hills (Figure 4).

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Figure 3 : Au (ppb) Proportional Dot Diagram

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Figure 4 : Cu (ppm) Proportional Dot with MAGLAG Cu (ppm) Inset

Nickel

Ni assays exhibit a strong correlation with Cu and appear anomalous in the vicinity of the Deflector corridor, with peak concentrations of 628 ppm observed (Figure 5).

5

Directors’ Report

Planned Follow-up Activities

Auger soil / rock chip geochemistry and MAGLAG data have combined to define three Deflector Extended target areas (Figure 6), which coincide with northeast-southwest structures and appear amenable to sub-surface investigation using inexpensive drilling techniques such as RAB +/- Aircore methods.

These areas include:

Target Area 1: Overlapping elevated auger Au, Cu and As values, supported by high MAGLAG Cu and As assays.

Target Area 2: Coincident Au and Cu enrichment, together with select elevated As assays. Target Area 3: Coincident elevated auger Au and Cu values, together with spot As and Ni highs.

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Figure 5: Ni (ppm) Proportional Dot with MAGLAG Cr (ppm) Inset

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Figure 6: Deflector Extended - Prospective Follow-up Target Areas

MinRex will continue its systematic exploration activities at its Deflector Extended prospect to identify the source of enrichment observed to date, with a view to the intersection of economically significant precious and base metal mineralisation.

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Directors’ Report

Heemskirk Tin Project

Derwent Geoscience Pty Ltd (Derwent) was contracted by MinRex Resources NL (‘MinRex’ or ‘Company’) to conduct an initial evaluation of its approximately 44 km[2] exploration lease (EL18/2011), located on the west coast of Tasmania. Work completed over the quarter has included:

• Collation of Open File data from Mineral Resources Tasmania (MRT).

• Field reconnaissance surveys to locate and inspect historical workings and prospective outcrop.

• Sampling of both rock and stream sediment samples from local area prospects.

Historically, the Heemskirk region has contained many small but comparatively rich, vein hosted tin oxide prospects. Exploration activity within the lease area has been sporadic over the last century, with the Peripatetic Mine area receiving the greatest attention. Systematic regional exploration has not been conducted in recent times.

Location and Access

Exploration lease EL18/2011 is a 44 km[2 ] area located to the north of Trial Harbour on the west coast of Tasmania and some 325 km from Hobart (Figure 7).

Local Geology

The Heemskirk Batholith is a large igneous intrusion exposed over 120 km[2] along the west coast of Tasmania near Zeehan. It is dominated by two varieties of granite - the Red Granite occupies the upper portions of this bod and is re-intruded by the White Granite along its west margins (Figure 8). Economic mineralisation is spatially associated with late stage greisenisation of pre-existing joints and lineaments, with cassiterite bearing veins often containing a central core of quartztopaz-tourmaline. In several areas, these are accompanied by sulphide mineralisation, comprising sphalerite, galena, chalcopyrite and bismuthinite.

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Figure 7 : Heemskirk Tin Project - Exploration lease EL18/2011

7

Directors’ Report

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Figure 8 : Heemskirk Tin Project – Local Geology

Preliminary Exploration Program

Derwent investigated 14 old workings and their surrounds, with alteration and mineralisation trends observed (Figure 9). The margins of North Heemskirk Spur were traversed along with the upper parts of the St. Dizier catchment. The Granite Creek area was also inspected to follow up reports of locally coarse grained, molybdenite-bearing veins.

Multiple sulphide-bearing rock chips and (-2 mm) stream sediment samples were collected near historic workings at Iron Blow and McGuiness. Given that two undocumented workings were identified over and above those indicated on MRT maps, it is likely that many more await discovery within the lease area. Some of these will undoubtedly offer further insights into the distribution of local area mineralisation.

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Figure 9 : Heemskirk Tin Project – Geological Traverses

8

Directors’ Report

Follow-up Exploration Activities

At this comparatively early phase of exploration, sequentially planned exploration work at Heemskirk will include:

• Purchase of MRT’s local magnetic and radiometric datasets.

• Detailed investigation of areas of advanced argillic alteration.

• Comprehensive prospecting of several historic workings, especially at Iron Blow and the Peripatetic Tin Mine.

• Stream sediment sampling of all relevant major area drainages / catchments.

The Company is also continuing to actively seeking other opportunities in the mining sector with the aim of significantly add value for shareholders.

Minrex, for a junior company, is currently in a strong position to assess projects as a result of the Company’s high cash holdings. This places it in a good position to take advantage of mineral resource assets that are becoming available - as a consequence of the difficulty many junior exploration companies are experiencing in raising the necessary funding for exploration and development.

SIGNIFICANT EVENTS AFTER THE BALANCE DATE

There were no known significant events from the end of the financial period to the date of this report.

AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES

Section 307C of the Corporations Act 2001 requires the Company’s auditors to provide the Directors of MinRex Resources NL with an Independence Declaration in relation to the audit of the half year end financial report. A copy of that declaration is set out below.

There were no non audit services provided by the Company’s auditor.

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Directors’ Report

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Signed on behalf of the board in accordance with a resolution of the Directors.

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Richard Procter Chairman

12 March 2013

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MinRex Resources NL

Statement of Comprehensive Income For the half year ended 31 December 2012

Note Revenue from ordinary activities Interest Income Depreciation and amortisation Corporate expenses Business development expenses Management and administration expenses Loss from ordinary activities before income tax expense Income tax expense Net loss attributable to the members of Minrex Resources NL Other comprehensive income Other comprehensive income for the period, net of tax Total comprehensive loss for the half-year Basic loss per share attributable to the ordinary equity holders of the company Diluted loss per share attributable to the ordinary equity holders of the company	31-Dec 2012 $ 48,376 (2,804) (112,071) (280) (83,198) (149,977) - (149,977) - (149,977) (0.01) (0.01)	Period from date of incorporation, 30-May 2011 to 30-Nov 2011 $ - (3) (90,858) (197,650) (13,134) (301,645) - (301,645) - (301,645) (0.12) (0.12)

The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes

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MinRex Resources NL

Statement of Financial Position

As at 31 December 2012

Current Assets Note Cash and cash equivalents Other receivables Prepayment Total Current Assets Non-Current Assets Exploration, evaluation and development expenditure 4 Property, plant and equipment Total Non-Current Assets Total Assets Current Liabilities Trade and other payables Total Current Liabilities Total Liabilities Net Assets Equity Contributed equity 5 Accumulated losses Total Equity	31-Dec 2012 $ 2,720,069 22,740 8,812 2,751,621 127,608 27,568 155,176 2,906,797 21,996 21,996 21,996 2,884,801 3,454,614 (569,813) 2,884,801	30-Jun 2012 $ 2,945,321 17,713 2,058
		2,965,092
		89,810 277
		90,087
		3,055,179
		20,401
		20,401
		20,401
		3,034,778
		3,454,614 (419,836)
		3,034,778

The above Statement of Financial Position should be read in conjunction with the accompanying notes

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MinRex Resources NL

Statement of Cash Flows

For the half year ended 31 December 2012

Cash Flows From Operating Activities Interest received Payments to suppliers and employees Net cash used in operating activities Cash flows From Investing Activities Payments for plant and equipment Payments for exploration, evaluation and development expenditure Payments for Security Deposit Receipts of Security Deposit Net cash provided by investing activities Cash Flows From Financing Activities Proceeds from issue of shares Share issue costs Net cash provided by financing activities Net increase/(decrease) in cash held Cash at the beginning Cash held at the end of the year	31-Dec 2012 $ 48,362 (205,493) (157,131) (30,095) (37,798) (10,228) 10,000 (68,121) - - - (225,252) 2,945,321 2,720,069	Period from date of incorporation, 30-May 2011 to 30-Nov 2011 $ - (296,643)
		(296,643)
		(314) (12,748) - -
		(13,062)
		3,675,000 (216,793)
		3,458,207
		3,148,502 -
		3,148,502

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MinRex Resources NL

Statement of Changes in Equity For the half year ended 31 December 2012

Issued Capital Opening balance Issued during the period Share issue costs Closing balance Accumulated Losses Opening balance Total comprehensive loss for the period Closing balance Total Equity	31-Dec Period from date of incorporation, 30-May 2011 to 30-Nov 2012 2011 $ $ 3,454,614 - - 3,675,000 -(216,793) 3,454,614 3,458,207 (419,836) - (149,977) (301,645) (569,813) (301,645) 2,884,801 3,156,562

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes

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MinRex Resources NL Notes to the financial statements for the half-year ended 31 December 2012

1. Corporate Information

The interim financial report of MinRex Resources NL for the half-year ended 31 December 2012 was authorised for issue in accordance with a resolution of the directors on 12 March 2013.

MinRex Resources NL is a company limited by shares, incorporated and domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange.

The nature of the operations and the principal activities of the Company are described in the Directors’ Report.

2. Summary of Significant Accounting Policies

(a) Basis of Preparation

This general-purpose condensed financial report for the interim reporting period ended 31 December 2012 has been prepared in accordance with Accounting Standard AASB134 Interim Financial Reporting and the Corporations Act 2001.

This interim financial report does not include all the notes of the type normally included in an 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 Company. Accordingly, this interim financial report is to be read in conjunction with the Company’s Annual report dated 30 June 2012 and any public announcements made by MinRex Resources NL during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The interim financial report has been prepared on an accruals basis and is based on historical costs. The presentation currency is Australian dollars.

(b) Comparatives

MinRex Resources NL was incorporated on 30 May 2011. As such the comparative information for the Statement of Comprehensive Income, Statement of Cash Flows and Statement of Changes in Equity is for the six month Period from date of incorporation, 30 May 2011, to 30 November 2012, being the period covered by the Company’s first half-year report.

(c) Accounting policies

The interim financial report has been prepared with the same accounting policies as applied on 30 June 2012. In setting the accounting policies, the Company has considered all new and revised Accounting Standards and Interpretations issued by the AASB that are relevant to its operations and effective from the date of incorporation. The adoption of new and revised Accounting Standards and Interpretations did not have an impact on the financial position and performance of the company.

The company has not early adopted any of the Accounting Standards and Interpretations that have been issued or amended but are not yet effective.

3. Segment Information

For management purposes, the Company is organized into one main operating segment, which involves mining and exploration for gold and other minerals. All of the Company’s activities are interrelated, and discrete financial information is reported to the Board (Chief Operating Decision Makers) as a single segment. Accordingly, all significant operating decisions are based upon analysis of the Company as one segment. The financial results from this segment are equivalent to the financial statements of the Company as a while. Total revenue earned by the Company is generated in Australia and all the Company’s non-current assets reside in Australia.

15

MinRex Resources NL Notes to the financial statements for the half-year ended 31 December 2012

4. Exploration, evaluation and development expenditure

Exploration, evaluation and development assets(a) (a) Area of Interest Deflector Extended Gold Project- Western Australia Heemskirk Tin Project - Tasmania Carrying amount at end of year1 (b) Reconciliation Carrying amount at beginning of period Additions Carrying amount at end of year1	31-Dec 30-Jun 2012 2012 $ $ 127,608 89,810 81,543 68,471 46,065 21,339 127,608 89,810 89,810 - 37,798 89,810 127,608 89,810

1 The ultimate recoupment of costs carried forward for exploration and evaluation phases is dependent on the successful development and commercial exploitation or sale of the respective areas.

On 18 July 2011, the Company acquired the Deflector Extended Gold Project license located in Western Australia. The total cost of the acquisition was $10,248 and comprised a cash payment to the vendor. On 12 July 2012, legal title of the license was transferred to the Company.

On 3 April 2012, the Company was granted an exploration licence for Heemskirk in Tasmania for a $1,000 cash payment. The total area of the Licence Area is 44 sq.km, and is located on the west coast of Tasmania.

5. Contributed Equity

There were no shares or options issued during the period

6. Events Subsequent to Balance Date

There have been no events that have arisen since the balance date that has affected or may significantly affect the operation of Company.

7. Contingent Liabilities

As at the date of this report, no contingent liabilities had been identified in relation to the half-year ended 31 December 2012.

8. Capital Commitments

The company’s minimum expenditure commitments in relation to its tenements are:

• 1) Deflector Extended Gold project (E59/1657): $15,000

• 2) Heemskirk Tin Project (EL 18/2011) : $26,000 for the first 2 years

The Company leases office space in West Perth. The current rent is $35,400 per annum excluding outgoings. The lease expires on 30 June 2014.

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DIRECTORS’ DECLARATION

In accordance with a resolution of the Directors of MinRex Resources NL, I state that:

In the opinion of the Directors:

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

• (i) giving a true and fair view of the financial position of the company as at 31 December 2012 and of its performance, for the period ended on that date; and

• (ii) complying with Accounting Standard AASB134 Interim Financial Reporting and the Corporations Regulations 2001;

• (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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Richard Procter Chairman

12 March 2013

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