RTG Mining Inc. — Interim / Quarterly Report 2014

Aug 12, 2014

I N T E R I M F I N A N C I A L S T A T E M E N T S

F O R T H E I N T E R I M P E R I O D E N D E D 3 0 J U N E 2 0 1 4

Contents

Page

Corporate Directory
Directors' Report
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
Notes to the Consolidated Financial Statements
Directors Declaration
Auditors Independence Declaration
Independent Audit Report

Corporate Directory

DIRECTORS:

Michael J Carrick Justine A Magee David A T Cruse Phillip C Lockyer Robert N Scott Mathew G Syme (appointed 4 June 2014)

SECRETARY:

Hannah C Hudson

REGISTERED AND PRINCIPAL OFFICE:

Level 2 338 Barker Road Subiaco WA 6008

TELEPHONE:+61 8 6489 4000 FACSIMILE: +61 8 6489 4020

BANKERS:

Australia and New Zealand Banking Group Limited 77 St Georges Terrace Perth WA 6000

AUDITORS:

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008

STOCK EXCHANGE:

Australian Securities Exchange Limited Exchange Code: RTG – Fully paid ordinary shares

Toronto Stock Exchange Inc Exchange Code: RTG – Fully paid ordinary shares

SHARE REGISTER:

Australian Register Computershare Investor Services Pty Limited Level 2 45 St Georges Terrace Perth WA 6000

Telephone: 1300 557 010 or + 61 8 9323 2000 Facsimile: + 61 8 9323 2033

Canadian Register Computershare Investor Services Inc 100 University Ave, 11th Floor Toronto Ontario M5J2Y1 Canada

Telephone: +1 416 263 9449 Facsimile: +1 416 981 9800

LAWYERS

K&L Gates Level 32, 44 St Georges Terrace Perth WA 6000

Blake, Cassels & Graydon Suite 2600 3 Bentall Centre 59 Burrard Street Vancouver, B.C. Canada V7X 1L3

Directors' Report

The Directors of RTG Mining Inc ("the Company" or "RTG") present their report and the financial statements of RTG and its wholly owned controlled entities (the "Consolidated Entity" or "the Group") for the half year ended 30 June 2014.

DIRECTORS

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

Michael J Carrick Justine A Magee Phillip C Lockyer Robert N Scott David A T Cruse Mathew G Syme (appointed 4 June 2014)

REVIEW AND RESULTS OF OPERATIONS

Operating Results

The Consolidated Entity recorded a net loss of US$3,092,033 (2014:US$881,240) for the halfyear ended 30 June 2014. The Group's activities during the half year period focussed on the implementation of the schemes of arrangement (the "Schemes") pursuant to the terms of the previously-announced Scheme Implementation Deed dated February 24, 2014 (the "Deed") between RTG and Sierra Mining Limited ("Sierra") to acquire all of the outstanding securities of Sierra. The transaction was completed on 4 June 2014. Refer to note 2b for further details.

AUDITOR'S INDEPENDENCE DECLARATION

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page19, which forms part of the director's report.

This report is made in accordance with a resolution of the directors.

MICHAEL CARRICK Director Perth

13 August 2014

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the period ended

	Note	30 June2014(six months)	31 December 2013(six months)
Continuing operations		US$	US$
Revenue	3	17,924	24,598
Exploration and evaluation expenditure	4(a)	-	(91,333)
Business development	4(b)	(716,927)	(790,426)
Foreign exchange loss		(179,247)	(201,060)
Administrative expenses	4(c)	(2,086,898)	(2,038,845)
Share of loss of associate	8	(126,885)	-
Loss from continuing operations		(3,092,033)	(3,097,066)
Income tax benefitLoss from continuing operations for the		-	-
period		(3,092,033)	(3,097,066)
Discontinued operations
Gainfrom discontinued operations after tax		-	2,215,826
Net loss for the period		(3,092,033)	(881,240)
Other comprehensive incomeItems that may be reclassified to profit or loss:Exchange differences on translation of foreign
operationsOther comprehensive incomefor the		18,169	-
period		18,169	-
Total comprehensive (loss) for the period		(3,073,864)	(881,240)
Loss attributable to:
Owners of the Company		(3,092,033)	(881,240)
Total comprehensive loss attributable to:
Owners of the Company		(3,073,864)	(881,240)
Loss per share from continuing operationsattributable to the ordinary equity holdersof the company*
Basic loss per share (cents)		(8.03)	(9.48)*
Diluted loss per share (cents)Loss per share attributable to the ordinaryequity holders of the company*		(8.03)	(9.48)*
Basic loss per share (cents)		(8.03)	(2.69)*
Diluted loss per share (cents)		(8.03)	(2.69)*

The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.

*The Company completed a 10 for 1 consolidation of its issued capital on 29 May 2014. These figures have been recalculated on a post consolidation basis.

Consolidated Statement of Financial Position

	Note	30 June 2014US$	31 December 2013US$
ASSETS
Current Assets
Cash and cash equivalents	5	7,234,480	10,987,534
Trade and other receivables	6	881,077	276,255
Prepayments		41,046	187
Total Current Assets		8,156,603	11,263,976
Non-Current Assets
Property, plant and equipment		247,609	362,329
Investment in associate	8	83,857,142	-
Available for sale financial assets		1,841,854	1,841,854
Loans to associate	12	643,670	-
Derivative financial asset		1,330,228	1,330,228
Total Non-CurrentAssets		87,920,503	3,534,411
TOTAL ASSETS		96,077,106	14,798,387
LIABILITIES
Current Liabilities
Trade and other payables	7	361,983	208,625
Total Current Liabilities		361,983	208,625
TOTAL LIABILITIES		361,983	208,625
NET ASSETS		95,715,123	14,589,762
SHAREHOLDER'S EQUITY
Issued capital	9	113,899,899	34,162,759
Reserves		3,319,297	(1,160,957)
Accumulated losses		(21,504,073)	(18,412,040)
TOTAL SHAREHOLDER'SEQUITY		95,715,123	14,589,762

The above consolidated statement of financial position should be read in conjunction with the accompanying notes.

Consolidated Statement of Cash Flows

For the period ended

		30 June2014	31 December 2013(six months)
	Note	(six months)US$	US$
Cash flows from operating activities
Exploration costs		-	(91,333)
Payments to suppliers and employees		(3,190,723)	(3,391,819)
Interest received		17,924	24,598
Net cash (outflow)from operating
activities		(3,172,799)	(3,458,554)
Cash flows from investing activities
Payments for property, plant & equipment		(14,405)	(341,024)
Loans to associateCash acquired from asset acquisitionnet of		(643,670)	-
expenses		238,899	-
Net cash outflow from investing
activities		(419,176)	(341,024)
Cash flows from financing activities
Share issue costs		-	-
Net cash inflow from financing activities		-	-
Net increase/(decrease) in cash and cashequivalents		(3,591,975)	(3,799,578)
Cash and cash equivalents at beginning
of the period		10,987,534	14,988,172
Effects of exchange rate fluctuations on the
balances of cash held in foreign currencies		(161,079)	(201,060)
Cash and cash equivalents at end of the
financial period	5	7,234,480	10,987,534

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.

Consolidated Statement of Changes in Equity

For the six months ended 30 June 2014

				Foreign
		Acquisition	Share option	CurrencyTranslation	Accumulated
	Issued Capital	reserve	reserve	Reserve	Losses	Total
	US$	US$	US$	US$	US$	US$
Balance at 1	34,162,759	(4,300,157)	3,139,200	-	(18,412,040)	14,589,762
January 2014
Other comprehensive
income	-	-	-	18,169	-	18,169
(Loss)for the period	-	-	-	-	(3,092,033)	(3,092,033)
Total
comprehensive
income /(loss) for
the period	-	-	-	18,169	(3,092,033)	(3,073,864)
Transactions with owners
in their capacity as
owners:
Share issueunder					-
Scheme	79,737,140	-	-	-		79,737,140
Optionissueunder					-
Scheme	-	-	4,462,085	-		4,462,085
Share issue costs	-	-	-	-	-	-
At 30 June 2014	113,899,899	(4,300,157)	7,601,285	18,169	(21,504,073)	95,715,123

For the six months ended 31 December 2013

		Acquisition	Share option	Accumulated
	Issued Capital	reserve	reserve	losses	Total
	US$	US$	US$	US$	US$
Balance at 1 July 2013	34,162,759	(4,300,157)	3,139,200	(17,530,800)	15,471,002
(Loss)for the period	-	-	-	(881,240)	(881,240)
Total comprehensive
(loss) for the period	-	-	-	(881,240)	(881,240)
At 31 December 2013	34,162,759	(4,300,157)	3,139,200	(18,412,040)	14,589,762

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

Notes to the Consolidated Financial Statements

1. CORPORATE INFORMATION

RTG Mining Inc ("the Company", "RTG", or "the Entity") was incorporated on 27 December 2012, and is domiciled in the British Virgin Islands. The Company's registered address is Midocean Chambers, Road Town, Tortola, VG1110 British Virgin Islands. Its shares are publicly traded on both the Australian Stock Exchange ("ASX") and the Toronto Stock Exchange ("TSX").

The consolidated financial statements of the Group as at and for the half year to 30 June 2014 comprise the Company and its subsidiaries (together referred to as "the Group" and individually as "the Group entities"). The half year consolidated financial statements to 30 June 2014 were recognised for issue in accordance with a resolution of directors on 13 August 2014.

The Group's activities during the half year period focussed on the implementation of the schemes of arrangement (the "Schemes") pursuant to the terms of the previously-announced Scheme Implementation Deed dated February 24, 2014 (the "Deed") between RTG and Sierra Mining Limited ("Sierra") to acquire all of the outstanding securities of Sierra. The transaction was completed on 4 June 2014.

2. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of preparation

The interim consolidated financial statements have been prepared on a historical cost basis. Cost is based on the fair value of the consideration given in exchange for assets. All amounts are presented in United States Dollars (US$), unless otherwise noted.

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

Statement of compliance

The consolidated financial statements have been prepared as a general purpose financial report. The consolidated financial report complies with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.

This condensed half-year report does not include full disclosures of the type normally included in an annual financial report. Therefore, it cannot be expected to provide as full and understanding of the financial performance, financial position and cash flows of the Group as in the full financial report.

It is recommended that this financial report be read in conjunction with the annual financial report for the period ended 31 December 2013 and any public announcements made by RTG during the half year in accordance with continuous disclosure requirements arising under the ASX and TSX listing rules.

The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.

RTG changed its financial year end from 30 June to 31 December during the December 2013 period therefore the prior period comparatives are those of the 6 month year end 31 December 2013 financial statements.

Impact of accounting standards not yet adopted

AASB 9 Financial Instruments addresses the classification, measurement and derecognition of financial assets and financial liabilities. The standard is not applicable until 1 January 2018 but is available for early adoption. The Company has not yet assessed its impact, and not decided whether to adopt any parts of AASB 9 early.

(b) Asset Acquisition

RTG acquired all of the outstanding shares of Sierra ("Sierra Shares") and all of the outstanding listed options of Sierra ("Sierra Options"), and issued as consideration:

to eligible shareholders of Sierra, 3 new ordinary shares of RTG ("RTG Shares") for every 10 Sierra Shares held and 1 new share purchase option of the Company ("RTG Option") for every 30 Sierra Shares held; and

to eligible optionholders of Sierra, 2 RTG Shares for every 10 Sierra Options held and 2 RTG Options for every 90 Sierra Options held.

The Company also acquired all unlisted Sierra Options ("Sierra Unlisted Options"), and issued as consideration to such holders of Sierra Unlisted Options:

1 RTG Share for every 10 Sierra Unlisted Options exercisable at $0.20 each on or before July 1, 2014, together with 1 RTG Option for every 90 Sierra Unlisted Options held; and

1 RTG Share for every 20 Sierra Unlisted Options exercisable at $0.25 each on or before July 1, 2015, together with 1 RTG Option for every 180 Sierra Unlisted Options held.

On 4 June 2014 RTG completed the above through the issuance of 79,063,206 ordinary RTG shares and 8,784,854 RTG listed options.

Pursuant to the Schemes, RTG has acquired a direct 40% interest in each of Mt Labo Exploration & Development Corporation, St Ignatius Exploration and Mineral Resources Corporation, Bunawan Mining Corporation and Oz Metals Exploration and Development Corporation and a further indirect 24% interest in Mt Labo Exploration and Development Corporation. As the acquisition of Sierra is not deemed a business acquisition, the transaction must be accounted for as a share based payment for the net assets acquired.

When an asset acquisition does not constitute a business combination, the assets and liabilities are assigned a carrying amount based on their relative fair values in an asset purchase transaction and no deferred tax will arise in relation to the acquired assets and assumed liabilities as the initial recognition exemption for deferred tax under AASB112 applies. No goodwill will arise on the acquisitions and transaction costs of the acquisitions will be included in the capitalised costs of the asset.

Notes to the Consolidated Financial Statements

3. REVENUE

	30 June	31 December
	2014	2013
	(six months)	(six months)
	US$	US$
Interest income	17,924	24,598
	17,924	24,598

4. EXPENSES

	30 June2014	31 December2013
	(six months)US$	(six months)US$
(a) Exploration and evaluation expenditure
Employee benefits	-	56,380
Consultants fees	-	9,930
Motor vehicle expenses	-	4,261
Travel expenses	-	478
Other general and office costs	-	20,284
	-	91,333

	30 June2014(six months)US$	31 December2013(six months)US$
(b) Business development
Travel	230,666	283,304
Employee fees	293,079	266,876
Other	193,182	240,246
	716,927	790,426

	30 June2014(six months)US$	31 December2013(six months)US$
(c) Administrative expenses
Accounting & audit fees	9,854	5,489
Employee and directors fees	824,610	612,645
Legal fees	506,153	923,046
Listing and shareholder reporting costs	153,314	9,728
Consultants	39,338	27,355
Other	553,629	460,582
	2,086,898	2,038,845

Notes to the Consolidated Financial Statements

5. CASH AND CASH EQUIVALENTS

	30 June	31 December
	2014	2013
	US$	US$
Cash on hand	65	1,647
Cash at bank	7,234,415	10,985,887
	7,234,480	10,987,534

Cash at bank earns interest at floating rates based on daily bank deposit rates.

6. TRADE AND OTHER RECEIVABLES

	30 June	31 December
	2014	2013
	US$	US$
VAT and GST	137,991	58,168
Other	743,086	218,087
Previous joint venture partner receivable	-	1,396,453
Provision for joint venture partner receivable	-	(1,396,453)
	881,077	276,255

Receivables are non-interest bearing and are generally on 30-90 day terms. Other than the joint venture partner receivable, there are no receivables past due or impaired and it is expected that these receivables will be received when due.

The previous joint venture partner receivable due on the joint venture partner's 49% share of the development costs funded by the Company at the Mkushi Copper Project has been fully provided for the Company as at 31 December 2013. During the prior period, the Company has completed the sale of its interest in the Mkushi Copper Project. Under the sale agreement, the purchaser, Elephant Copper Ltd. agreed to repay the full receivable to RTG by 1 January 2014. RTG did not receive the payment on that date hence the amount has been fully provided for at 31 December 2013. RTG issued a demand letter on 8 January 2014 demanding payment of the outstanding debt. RTG has advised Elephant Copper that it fully reserves all of its rights and remedies under the sale agreement.

7. TRADE AND OTHER PAYABLES

	30 June	31 December
	2014	2013
	US$	US$
Trade creditors	201,426	193,625
Accrued expenses	160,557	15,000
	361,983	208,625

Trade payables are non-interest bearing and are normally settled on 30 to 60 day terms. There are no amounts that are expected to be settled greater than 12 months.

8. INVESTMENT IN ASSOCIATE

On 4 June 2014, RTG completed the implementation of the schemes of arrangement (the "Schemes") pursuant to the terms of the previously-announced Scheme Implementation Deed dated February 24, 2014 (the "Deed") between RTG and Sierra Mining Limited ("Sierra") to acquire all of the outstanding securities of Sierra.

Pursuant to the Schemes, RTG has acquired a direct 40% interest in each of Mt Labo Exploration & Development Corporation, St Ignatius Exploration and Mineral Resources Corporation, Bunawan Mining Corporation and Oz Metals Exploration and Development Corporation and a further indirect 24% interest in Mt Labo Exploration and Development Corporation. As the acquisition of Sierra is not deemed a business acquisition, the transaction must be accounted for as a share based payment for the net assets acquired.

The consideration payable was 79,063,206 ordinary RTG shares and 8,784,854 RTG listed options. Details of the fair value of the assets and liabilities acquired as at 4 June 2014 are as follows:

Purchase consideration comprised	30 June 2014
	US$
79,063,206 ordinary shares*	79,737,140
8,784,854 listed options*	4,462,085
Total consideration	84,199,225
Costs associated with acquisition	1,088,767
	85,287,992

*Share issue price C$1.10, option issue value C$0.554

Net assets acquired

Recognised atacquisitionUS$	CarryingvalueUS$
1,327,666	1,327,666
349,015	349,015
83,984,027(1)	1,366,798
85,660,708	3,043,479
(372,716)	(372,716)
85,287,992	2,670,763

Cash inflow on acquisition

Net cash at acquisition date	1,327,666
Direct costs related to acquisition	(1,088,767)
	238,899

8. INVESTMENT IN ASSOCIATE (cont.)

(1) Investment in associate at 30 June 2014

	30 June
	2014
	US$
Investment in associate	83,984,027
Share of net loss of associate	(126,885)
	83,857,142

9. ISSUED CAPITAL

	30 June	31 December	30 June	31 December
	2014	2013	2014	2013
	Number	Number	US$	US$
Issued and paid up
capital:	111,717,070	326,538,643	113,899,900	34,162,759

Fully paid ordinary shares carry one vote per share and the right to dividends. The Company is authorised to issue an unlimited number of shares of no par value of a single class.

Weighted average number of shares

Adjusted weighted average number of ordinary sharesused in calculating diluted earnings per share	38,502,375	32,653,864
Effect of dilutive options	-	-
calculating basic earnings per share	38,502,375	32,653,864
Weighted average numberof ordinary shares used in

Movements in contributed equity during the period were as follows:

(a) Ordinary Shares	Number	US$
Opening balance at 1 January 2014	326,538,643	34,162,759
Share consolidation 1:10	(293,884,779)	-
Shares issued under Scheme	79,063,206	79,737,140
Capital raising costs	-	-
Total shares on issue at 30 June 2014	111,717,070	113,899,899

10. OPTIONS

Movements in the number of listed options during the period are as follows:

(a) Listed options	Number	US$
Opening balance at 1 January 2014	-	-
Optionsissued under Scheme*	8,784,854	4,462,085
Total optionson issue at 30 June 2014	8,784,854	4,462,085
*Issued in relation to the Scheme

10. OPTIONS (cont.)

The options issued in the period were valued using the Black and Scholes method with the following assumptions:

Number of options	8,784,854
Grant date share price	C$1.10
Exercise price	C$1.50
Expected volatility	90%
Option life	3 years
Dividend yield	0.00%
Interest rate	1.2%

11. DIVIDENDS PAID OR PROVIDED FOR

No dividends have been paid or provided for during the half-year.

12. LOANS TO ASSOCIATES

On 4 June 2013, RTG completed the implementation of the schemes of arrangement (the "Schemes") pursuant to the terms of the previously-announced Scheme Implementation Deed dated February 24, 2014 (the "Deed") between RTG and Sierra Mining Limited ("Sierra") to acquire all of the outstanding securities of Sierra.

Pursuant to the Schemes, RTG acquired all of the outstanding shares of Sierra ("Sierra Shares") and all of the outstanding listed options of Sierra ("Sierra Options"), and issued as consideration:

to eligible shareholders of Sierra, 3 new ordinary shares of RTG ("RTG Shares") for every 10 Sierra Shares held and 1 new share purchase option of the Company ("RTG Option") for every 30 Sierra Shares held; and

to eligible optionholders of Sierra, 2 RTG Shares for every 10 Sierra Options held and 2 RTG Options for every 90 Sierra Options held.

The Company also acquired all unlisted Sierra Options ("Sierra Unlisted Options"), and issued as consideration to such holders of Sierra Unlisted Options:

1 RTG Share for every 10 Sierra Unlisted Options exercisable at $0.20 each on or before July 1, 2014, together with 1 RTG Option for every 90 Sierra Unlisted Options held; and

1 RTG Share for every 20 Sierra Unlisted Options exercisable at $0.25 each on or before July 1, 2015, together with 1 RTG Option for every 180 Sierra Unlisted Options held.

Pursuant to the Schemes, RTG has acquired a direct 40% interest in each of Mt Labo Exploration & Development Corporation, St Ignatius Exploration and Mineral Resources Corporation, Bunawan Mining Corporation and Oz Metals Exploration and Development Corporation and a further indirect 24% interest in Mt Labo Exploration and Development Corporation.

12. LOANS TO ASSOCIATES (cont.)

During the period, the Group provided advances totaling $643,670 to associates; $557,636 for costs relating to Mt Labo Joint Venture, and $86,034 to Bunawan Mining Corporation.

13. FAIR VALUE MEASUREMENT

The Group measures the following assets at fair value on a recurring basis: Available for sale financial assets Derivative financial assets

Fair value hierarchy

IFRS 13 requires disclosures of fair value measurements by level of the following fair value measurement hierarchy.

Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 – inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 – inputs for the asset or liability that are not based on observable market data (unobserved inputs).

Recognised fair value measurements

The following table presents the Group's assets measured at fair value at 30 June 2014.

At 30 June 2014

	Notes	Level 1US$	Level 2US$	Level 3US$	TotalUS$
Available for salefinancial assetDerivative financial		-	-	1,841,854	1,841,854
assetTotal financial		-	-	1,330,228	1,330,228
assets		-	-	3,172,082	3,172,082

Disclosed fair values

Valuation techniques used to derive level 2 and level 3 fair values

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all the specific inputs required to fair value an instrument are observable, the instrument is classified as level 2. If one or more of the significant inputs is not based on market observable data, the instrument is classified as level 3. The Entity holds an investment and convertible note receivable from Elephant Copper Limited, an unlisted entity. The investment in Elephant Copper Limited was valued on RTGs 18% interest in Elephant Copper Limited's net asset carrying value, which is considered to Elephant Copper Limited's fair value of $10M, based on audited information and an independent valuation. The convertible note valuation was based on the investment interest RTG is entitled to receive in Elephant Copper Limited's net asset

Notes to the Consolidated Financial Statements

carrying value, should RTG elect to receive the convertible note receivable in the form of shares. Hence these items have been classified as Level 3 as there is no active market to be able to observe the fair market value of the shares to determine the fair values used for the financial instruments.

The following table presents the changes in level 3 items for the period ended 30 June 2014.

	Available for salefinancial assetsUS$	Derivativefinancial assetUS$	TotalUS$
Opening balance at 1 January
2014	-	-	-
Convertible note	1,841,854	1,330,228	3,172,082
Total financial assets	-	-	-
Acquisitions	-	-	-
At 30 June 2014	1,841,854	1,330,228	3,172,082
	Available for salefinancial assetsUS$	Derivativefinancial assetUS$	TotalUS$
Opening balance at 1 January2014	-	-	-
Convertible note	1,841,854	1,330,228	3,172,082
Total financial assets	-	-	-
Acquisitions	-	-	-
At 30 June 2014	1,841,854	1,330,228	3,172,082

Fair value of other financial instruments not measured at fair value

The carrying amounts of trade receivables and payables are assumed to approximate their fair values due to their short term nature. The loans to associates are currently not carried at fair value, however any potential differences between the carrying value and fair value would be considered immaterial.

14. COMMITMENT AND CONTINGENCIES

Operating lease commitment

	Payments due by period
Contractualobligations	Total	Less than 1year	1-3 years	4-5 years	More than 5years
Lease obligations1Total contractual	413,100	206,550	206,550	-	-
obligations1 Corporate office lease payments due.	413,100	206,500	206,550	-	-

There has been no change in contingent liabilities since last reporting date.

15. RELATED PARTY TRANSACTIONS

During the period 30 June 2014, the Company entered into transactions with related parties in the wholly-owned group:

• Loans of $97,275 were advanced on short term inter-company accounts; and
• Loans of $643,670 were advanced to associates, $557,636 for costs relating to Mt Labo Joint Venture, and $86,034 to Bunawan Mining Corporation.

These transactions were undertaken on the following terms and conditions:

• loans are repayable at call; and
• no interest is payable on the loans at present.

Controlling entity

The ultimate controlling entity in the wholly owned group is RTG Mining Inc.

16. EVENTS SUBSEQUENT TO BALANCE DATE

Subsequent to 30 June 2014, RTG issued 256,000 RTG Shares in connection with the Haywood Fee, as defined in the Circular dated April 8, 2014, and has issued 167 CHESS Depository Interests upon the exercise of options.

Directors Declaration

In accordance with a resolution of the directors of the Company, I state that in the opinion of the Directors:

the financial statements and notes of the consolidated entity:

• (i) give a true and fair view of the consolidated entity's financial position as at 30 June 2014 and of its performance for the six month period ended 30 June 2014; and
• (ii) comply with International Accounting Standards and other mandatory professional reporting standards; and

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.

MICHAEL CARRICK Director

Perth, 13 August 2014

Auditors Independence Declaration

Tel: +61 8 6382 4600 Fax: +61 8 6382 4601 www.bdo.com.au

38 Station Street Subiaco , WA 6008PO Box 700 West Perth WA 6872 Australia

DECLARATION OF INDEPENDENCE BY PETER TOLL TO THE DIRECTORS OF RTG MINING INC

As lead auditor for the review of RTG Mining Inc for the half-year ended 30 June 2014, I declare that to the best of my knowledge and belief, there have been:

• 1. no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
• 1. no contraventions of any applicable code of professional conduct in relation to the review.

This declaration is in respect of RTG Mining Inc and the entities it controlled during the period.

R1 C and and

Peter Toll Director

BDO Audit (WA) Pty Ltd Perth, 13th August 2014

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Independent Audit Report

Tel: +61 8 6382 4600 Fax: +61 8 6382 4601 www.bdo.com.au

38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

INDEPENDENT AUDITOR'S REVIEW REPORT

To the members of RTG Mining Inc.

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of RTG Mining Inc, which comprises the consolidated statement of financial position as at 30 June 2014, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the half-year ended on that date, notes comprising a statem ent of accounting policies and other explanatory inform ation, and the directors' declaration of the consolidated entity comprising the company and the entities it controlled at the half-year's end or from time to time during the half-year.

Directors' Responsibility for the Half-Year Financial Report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal 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 half-year 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 2014 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of RTG Mining Inc, 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.

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, which has been given to the directors of RTG Mining Inc, would be in the same terms if given to the directors as at the time of this auditor's review report.

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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 RTG Mining Inc 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 2014 and of its performance for the half-year ended on that date; and
• (b) complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001

BDO Audit (WA) Pty Ltd

$500$ Rie

Peter Toll Director

Perth, 13th August 2014