MINREX RESOURCES LIMITED — Interim / Quarterly Report 2014

Apr 29, 2014

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Quarterly Activities Report for the Period Ended 31 March 2014

HIGHLIGHTS

• During the quarter, MinRex continued to evaluate exploration data at its Deflector Extended Gold Project and Heemskirk Tin Project

• Mr Errol Bome was appointed to the Board of Directors, following the resignation of Mr Richard Procter on 27 February 2014

• Following the March 2014 quarter end, the Company announced the proposed acquisition of leading skin care developer Skin Elements Pty Ltd, subject to due diligence, shareholder approval & other regulatory requirements

• At the end of the March 2014 Quarter the Company had available cash of $2.227million.

About MinRex

MinRex is an exploration company listed on the Australian Securities Exchange with a focus to explore and develop gold, base metal and tin projects in Australia. The Company is also seeking additional projects, both within Australia and overseas.

MinRex has two principal projects in its exploration portfolio, the Deflector Extended Gold Project in Western Australia and the Heemskirk Tin Project in Tasmania (Figure 1). These projects provide MinRex with a base from which to explore two highly prospective areas of Australia. The Deflector Extended Gold Project is adjacent to the Deflector Gold Project, where Mutiny Gold Limited is reportedly planning to recommission the mine and gold treatment plant.

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Figure 1: Location of MinRex Project Areas

Exploration activities

Deflector Gold Project

During the March 2014 Quarter, MinRex obtained additional exploration results from the earlier exploration work completed on the Deflector Gold Project area (E59/1657) by other companies in the area in the past. In 2013, MinRex completed two surface sampling programs to follow up the previous auger and geochemical surveys. Work also continued on integrating the earlier surface geochemical surveys and RAB drilling with the results from the new surface sampling programs.

Heemskirk Tin Project

Evaluation of earlier data collection continued during the March 2014 Quarter with no new field work completed at the Heemskirk Tin Project (E18/2011). The data evaluation continues to assess the best areas for further follow up geological mapping, sampling and evaluation, if required. The project area is large and poorly explored and there remain many areas with old workings and known tin anomalism that are yet to be tested. Further field programs may be planned to hone in on potential mineralisation, later in the year.

The remote location of the Heemskirk Tin Project, surficial cover sequences, vegetation and climate are all thought to have detracted from the application of modern exploration methods to the Project area previously.

Limited exploration work is being undertaken at present given the focus on the recent announcement to acquire Skin elements Pty Ltd, a developer of natural skin care products (see below).

– Corporate Opportunities Acquisition of Skin Elements

The Company continued assessing a broad range of both exploration and alternative corporate opportunities that have the potential to complement the existing tenement portfolio and enhance shareholder value. The past year has seen an active program of assessments and a broad range of opportunities considered. This work is ongoing.

Following the March 2014 quarter end, the Company announced that it had made an offer to the Board of Skin Elements Pty Ltd (‘Skin Elements’) to acquire the entire share capital of the company, subject to due diligence, shareholder approval and other regulatory requirements. Skin Elements is a leading developer of natural and organic skin care products which holds an established portfolio of skin care brands and is well positioned to become a strong international player in an increasingly health conscious consumer market.

The Company is currently in the process of undertaking its due diligence with a view to finalising the transaction in the next quarter.

Corporate Organisation

During the quarter (27 February 2014), Mr Errol Bome was appointed to the Board of the Company and Mr Richard Procter resigned on the same date. The Board wishes to extend its thanks to Mr Procter for his services to the Company.

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For further information, please contact:

Simon Durack Executive Director and Company Secretary T: +61 8 9486 8806 F: +61 8 9321 3559 info@minrex.com.au

Competent Persons Statement:

The information in this report that relates to Exploration Targets and Exploration Results is based on information compiled by Mr Kieron Munro, Consulting Geologist. This information was first disclosed under the JORC Code 2004 and it has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. Mr Munro is employed as a consultant for MinRex and is also a Member of the Australian Institute of Geoscientists and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Munro consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Rule 5.5

Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/2013

Name of entity

	MINREX RESOURCES NL	MINREX RESOURCES NL
	ABN 81 151 185 867 Consolidated statement of cash flows
			31 MARCH 2014
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) Net Operating Cash Flows		Current quarter $A’000		Year to date (...9....months) $A’000
		- (15) - - (115) - 13 - - -		- (40) - - (333) - 43 - - -
		(117)		(330)
Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)		- - - - - - - - -		- - - - - - - - -
		-		-
		(117)		(330)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(117)	(330)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows	- - - - - -	- - - - - -
	-	-
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end of quarter	(117) 2,344 -	(330) 2,557 -
	2,227	2,227

Payments to directors of the entity, associates of the directors, related entities of the entity and associates of the related entities

1.23 1.24	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
		8
		-
1.25	Explanation necessaryfor an understandingof the transactions
	N/A

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

N/A

• See chapter 19 for defined terms.

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Mining exploration entity and oil and gas exploration entity quarterly report

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

N/A

Financing facilities available

Add notes as necessary for an understanding of the position.

	3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
		-	-
		-	-

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration		$A’000
			20
			-
			-
			100
Total			120
Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000		Previous quarter $A’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Bank overdraft 5.4 Other (provide details)	2		5
	2,225		2,339
	-		-
	-		-
Total: cash at end of quarter(item 1.22)	2,227		2,344

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Changes in interests in mining tenements and petroleum tenements

Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed N/A 6.2 Interests in mining tenements and petroleum tenements acquired or increased N/A Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates.	Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed N/A 6.2 Interests in mining tenements and petroleum tenements acquired or increased N/A Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates.	Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed N/A 6.2 Interests in mining tenements and petroleum tenements acquired or increased N/A Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates.	Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed N/A 6.2 Interests in mining tenements and petroleum tenements acquired or increased N/A Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates.	Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed N/A 6.2 Interests in mining tenements and petroleum tenements acquired or increased N/A Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates.
	Total number	Number quoted	Issue price per security (see note3) (cents)	Amount paid up per security (see note3) (cents)
7.1 Preference +securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, redemptions	N/A
	N/A
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	17,500,001 17,500,000	17,500,001 -	N/A 20 cents	N/A 1 cent
	- -	- -	- -	- -
7.5 +Convertible debt securities (description)	N/A

• See chapter 19 for defined terms.

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Mining exploration entity and oil and gas exploration entity quarterly report

7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted	N/A
7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	N/A		Exercise price	Expiry date
	N/A
	N/A
	N/A
7.11 Debentures (totals only)	N/A
7.12 Unsecured notes(totals only)	N/A

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5).

• 2 This statement does give a true and fair view of the matters disclosed.

Sign here: Date: 30/04/14 Director

Print name: .Simon Durack.....................................

Notes

• 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

• 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements and petroleum tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement or petroleum tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities .

• 4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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• See chapter 19 for defined terms.

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