RTG Mining Inc. — Interim / Quarterly Report 2015

Aug 16, 2015

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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 T H R E E A N D S I X M O N T H P E R I O D S E N D E D 3 0 J U N E 2 0 1 5

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|Contents|Page|
|Corporate Directory ....................................................................................................................................... 2|
|Directors’ Report ........................................................................................................................................... 3|
|Consolidated Statement of Profit or Loss and Other Comprehensive Income ............................................. 4|
|Consolidated Statement of Financial Position .............................................................................................. 5|
|Consolidated Statement of Cash Flows ........................................................................................................ 6|
|Consolidated Statement of Changes in Equity ............................................................................................. 7|
|Notes to the Consolidated Financial Statements .......................................................................................... 8|
|Directors Declaration ................................................................................................................................... 17|
|Auditor’s Independence Declaration ........................................................................................................... 18|
|Independent Auditors Review Report ......................................................................................................... 19|

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1

Corporate Directory

DIRECTORS:

Michael J Carrick Justine A Magee David A T Cruse Phillip C Lockyer Robert N Scott

SHARE REGISTER:

Australian Register

Computershare Investor Services Pty Limited Level 11 172 St Georges Terrace Perth WA 6000

SECRETARY:

Nicholas F Day (Appointed: 21 January 2015) Ryan P Gurner (Appointed: 9 Sept 2014, Resigned: 21 January 2015)

REGISTERED AND PRINCIPAL OFFICE:

Level 2 338 Barker Road Subiaco WA 6008

TELEPHONE: +61 8 6489 2900 FACSIMILE: +61 8 6489 2920

BANKERS: Westpac Banking Corporation 130 Rokeby Road Subiaco WA 6008

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

Telephone: 1300 850 505 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

Corrs Chambers Westgarth Level 15 Woodside Plaza 240 St Georges Terrace Perth WA 6000

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

STOCK EXCHANGE:

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

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

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

WEBSITE

www.rtgmining.com

2

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 2015.

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

REVIEW AND RESULTS OF OPERATIONS

Operating Results

The Consolidated Entity recorded a net loss of US$6,014,262 (2014 loss: US$3,092,033) for the half-year ended 30 June 2015. The Group’s activities during the half year to June 2015 continued with successful exploratory step out drilling and work progressing on the Definitive Feasibility Study at the Mabilo Project. Work on the Definitive Feasibility Study included metallurgical test work, work on environmental studies, and community development and infrastructure studies for the Project. The Company’s regional Philippines exploration continued during the period at the Bunawan and Bahayan Projects with preparation underway for geophysical programs in the next quarter. The Company also continued its efforts in the period on the identification of new business opportunities in the resources sector.

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 page18, which forms part of the director’s report.

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

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Justine Alexandria Magee Director Perth

13 August 2015

3

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the period ended

For the period ended
		Unaudited		Reviewed
		30 June	30 June	30 June	30 June
		2015	2014	2015	2014
	Note	(3 months)	(3 months)	(6 months)	(6 months)
		US$	US$	US$	US$
Continuing operations
Revenue	3	1,228	7,558	1,241	17,924
Business development	4(a)	(334,716)	(292,488)	(676,890)	(716,927)
Exploration & evaluation		112,431	-	-	-
Foreign exchange gain/(loss)		274,601	169,838	161,136	(179,247)
Administrative expenses	4(b)	(720,021)	(978,335)	(1,255,289)	(2,086,898)
Share of loss of associate	4(c)	(878,141)	(126,885)	(1,072,378)	(126,885)
Impairment expense	4(d)	(3,172,082)	-	(3,172,082)	-
Profit/(Loss) from continuing
operations		(4,716,700)	(1,220,312)	(6,014,262)	(3,092,033)
Income taxbenefit		-	-	-	-
Profit/(Loss) from continuing
operations for the period		(4,716,700)	(1,220,312)	(6,014,262)	(3,092,033)
Other comprehensive income/(loss)
Items that may be reclassified to profit or
loss:
Exchange differences on translation of
foreign operations		92,665	18,169	46,517	18,169
Other comprehensive income/(loss)
for the period		92,665	18,169	46,517	18,169
Total comprehensive income/(loss)
for the period		(4,624,035)	(1,202,143)	(5,967,745)	(3,073,864)
Profit/(Loss) attributable to:
Owners of the Company		(4,716,700)	(1,220,312)	(6,014,262)	(3,092,033)
Total comprehensive gain/(loss)
**attributable to: **
Owners of the Company		(4,624,035)	(1,202,143)	(5,967,745)	(3,073,864)
Loss per share from continuing
operations attributable to the ordinary
equity holders of the company
Basic gain/(loss) per share (cents)		(3.45)	(7.46)	(4.75)	(8.03)
Diluted gain/(loss) per share (cents)		(3.45)	(7.46)	(4.75)	(8.03)
Comprehensive Loss per share
attributable to the ordinary equity
holders of the company
Basic gain/(loss) per share (cents)		(3.36)	(7.41)	(4.72)	(7.98)
Diluted gain/(loss) per share (cents)		(3.36)	(7.41)	(4.72)	(7.98)
Weighted average number of shares
Basic and diluted		126,504,802	38,502,375	126,504,802	38,502,375

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

4

Consolidated Statement of Financial Position

		Reviewed	Audited
	Note	30 June 2015	31 December 2014
		US$	US$
ASSETS
Current Assets
Cash and cash equivalents	5	9,505,398	2,394,974
Trade and other receivables	6	366,927	349,146
Prepayments		20,185	130,579
Total Current Assets		9,892,510	2,874,699
Non-Current Assets
Property, plant and equipment		215,947	230,670
Available for sale financial assets	13	-	1,841,854
Investment in associate	9	81,423,689	83,197,341
Loans to associate	12	4,846,352	2,992,472
Derivative financial asset	13	-	1,330,228
Total Non-Current Assets		86,485,988	89,592,565
TOTAL ASSETS		96,378,498	92,467,264
LIABILITIES
Current Liabilities
Trade and other payables	7	191,040	276,566
Provisions	8	100,035	944,251
Total Current Liabilities		291,075	1,220,817
TOTAL LIABILITIES		291,075	1,220,817
NET ASSETS		96,087,423	91,246,447
SHAREHOLDER’S EQUITY
Issued capital	10	124,708,862	113,900,141
Reserves		3,246,212	3,199,695
Accumulated losses		(31,867,651)	(25,853,389)
TOTAL SHAREHOLDER’S EQUITY		96,087,423	91,246,447

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

5

Consolidated Statement of Cash Flows For the period ended

Note Cash flows from operating activities Payments to suppliers and employees Interest received Net cash (outflow) from operating activities Cash flows from investing activities Acquisition of plant & equipment Loans to associated entities Cash acquired from asset acquisition net of expenses Net cash (outflow) from investing activities Cash flows from financing activities Proceeds from share issue Share issue costs Net cash inflow from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of the period Effects of exchange rate fluctuations on the balances of cash held in foreign currencies Cash and cash equivalents at end of the financial period 5	Unaudited Reviewed 30 June 2015 (3 months) 30 June 2014 (3 months) 30 June 2015 (6 months) 30 June 2014 (6 months) US$ US$ US$ US$ (778,227) (1,645,919) (1,797,420) (3,190,723) 1,228 7,558 1,241 17,924
	(776,999) (1,638,361) (1,796,179) (3,172,799)
	- (8,502) - (14,405) (1,082,069) (643,670) (1,853,880) (643,670) - 238,899 - 238,899
	(1,082,069) (413,273) (1,853,880) (419,176)
	2,855,795 - 11,762,802 - (192,082) - (954,082) -
	2,663,713 - 10,808,720 -
	804,645 (2,051,634) 7,158,661 (3,591,975) 8,580,477 9,098,108 2,394,974 10,987,534 120,276 188,006 (48,237) (161,079)
	9,505,398 7,234,480 9,505,398 7,234,480

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

6

Consolidated Statement of Changes in Equity

For the six months ended 30 June 2015 (Reviewed)

					Foreign
	Number of			Share based	Currency
	Shares	Issued	Acquisition	payment	Translation		Accumulated
		Capital	reserve	reserve	Reserve		Losses	Total
		US$	US$	US$	US$		US$	US$
Balance at 1 January 2015
	111,973,237	113,900,141	(4,300,157)	7,601,285	(101,433)		(25,853,389)	91,246,447
Other comprehensive income		-	-	-	46,517		-	46,517
(Loss) for the period		-	-	-	-		(6,014,262)	(6,014,262)
Total comprehensive income
/(loss) for the period		-	-	-	46,517		(6,014,262)	(5,967,745)
Transactions with owners in their capacity as
owners:
Share issues	22,279,000	11,762,803	-	-	-		-	11,762,803
Share issue costs		(954,082)	-	-	-		-	(954,082)
At 30 June 2015	**134,252,237 **	**124,708,862 **	(4,300,157)	7,601,285	(54,916)		(31,867,651)	96,087,423
For the six months ended 30 June 2014(Reviewed)
					Foreign Currency
	Number of	Issued	Acquisition	Share option	Translation		Accumulated
	shares	Capital	reserve	reserve	Reserve		Losses	Total
		US$	US$	US$	US$		US$	US$
Balance at 1 January 2014	326,538,643	34,162,759	(4,300,157)	3,139,200		-	(18,412,040)	14,589,762
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 consolidation 1:10	(293,884,779)
Share issue under Scheme	79,319,206	79,737,140	-	-		-	-	79,737,140
Option issue under Scheme	167	-	-	4,462,085		-	-	4,462,085
Share issue costs		-	-	-		-	-	-
At 30 June 2014	111,973,237	113,899,899	(4,300,157)	7,601,285	18,169		(21,504,073)	95,715,123

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

7

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 2015 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 2015 were recognised for issue in accordance with a resolution of directors on 13 August 2015.

The Group’s activities during the half year to June 2015 continued with successful exploratory step out drilling and work progressing on the Definitive Feasibility Study at the Mabilo Project. Work on the Definitive Feasibility Study included metallurgical test work, work on environmental studies, and community development and infrastructure studies for the Project. The Company’s regional Philippines exploration continued during the period at the Bunawan and Bahayan Projects with preparation underway for geophysical programs in the next quarter. The Company also continued its efforts in the period on the identification of new business opportunities in the resources sector.

2. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of Accounting

The interim financial report is a general purpose condensed financial report which has been prepared in accordance with the requirements of International Accounting Standard 34 (“IAS 34”) as issued by the International Accounting Standards Board. The consolidated financial statements have also been prepared on a historical cost basis and are presented in United States Dollars (US$).

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 interim half-year report for six month period ending 30 June 2015 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.

The three month period results included in this financial report for the three month period ending 30 June 2015 and 30 June 2014 have not been reviewed.

It is recommended that this financial report be read in conjunction with the annual financial report for the year ended 31 December 2014 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.

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.

8

Notes to the Consolidated Financial Statements

3. REVENUE

Interest income 4. EXPENSES (a) Business development Travel Employee fees Project Analysis Conferences Other (b) Administrative expenses Accounting & audit fees Employee and directors fees Office rental Legal fees Listing and shareholder reporting costs Consultants Computer support Depreciation Other (c) Share of loss of associate Share of net losses of associates Drilling cost accrual of associate – reversal (d) Impairment expense Available for sale financial asset Derivative financial asset	Unaudited 30 June 2015 (3 months) 30 June 2014 (3 months) US$ US$ 1,228 7,558	Reviewed 30 June 2015 (6 months) 30 June 2014 (6 months) US$ US$ 1,241 17,924 1,241 17,924 Reviewed 30 June 2015 (6 months) 30 June 2014 (6 months) US$ US$ 388,635 230,666 217,071 293,079 29,008 149,136 35,118 32,850 7,058 11,196
	1,228 7,558
	Unaudited 30 June 2015 (3 months) 30 June 2014 (3 months) US$ US$ 162,423 165,052 108,420 86,352 23,405 15,107 34,574 16,557 5,894 9,420
	334,716 292,488	676,890 716,927
	96,043 (3,280) 340,396 482,980 48,940 51,225 86,997 130,857 118,128 132,506 7,743 21,572 6,203 21,993 7,407 9,791 8,164 130,691	125,309 9,854 618,974 824,610 93,105 195,211 156,530 506,153 141,607 153,314 25,000 39,338 17,212 32,430 14,723 15,694 62,829 310,294
	720,021 978,335	1,255,289 2,086,898
	1,699,053 126,885 (820,912) - 878,141 126,885	1,893,290 126,885 (820,912) -
		1,072,378 126,885
	(1,841,854) - (1,330,228) - (3,172,082) -	(1,841,854) - (1,330,228) -
		(3,172,082) -

5. CASH AND CASH EQUIVALENTS

. CASH AND CASH EQUIVALENTS
Cash at bank and on hand	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 9,505,398 2,394,974
	9,505,398 2,934,974

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

9

Notes to the Consolidated Financial Statements

6. TRADE AND OTHER RECEIVABLES

6. TRADE AND OTHER RECEIVABLES
VAT and GST Other	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 21,451 17,765 345,476 331,381
	366,927 349,146

Receivables are non-interest bearing and are generally on 30-90 day terms.

7. TRADE AND OTHER PAYABLES

Trade creditors Accrued expenses	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 113,662 105,466 77,378 171,100 191,040 276,566

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. PROVISIONS

Employee entitlements* Provision for drilling costs	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 100,035 123,339 - 820,912 100,035 **944,251 **

• Provision for Annual Leave

9. INVESTMENT IN ASSOCIATE

Opening Balance Associates acquired Share of associates net loss Share of foreign currency translation reserve	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 83,197,341 - - 83,989,104 (1,893,290) (856,588) 119,638 64,825
	81,423,689 83,197,341

(a) Acquisition of interest

On 4 June 2014, RTG completed the implementation of the Schemes pursuant to the terms of the previouslyannounced 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. 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.

10

Notes to the Consolidated Financial Statements

The consideration payable was 79,063,206 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	31 December 2014
	US$
79,063,206 shares*	79,737,140
8,784,854 listed options*	4,462,085
Total consideration	84,199,225
Costs associated with acquisition	1,093,842
	85,293,067
*Share issue price C$1.10, option issue value C$0.554
(This was the closing price on issue of 4/6/2014)
Net assets acquired

*Share issue price C$1.10, option issue value C$0.554 (This was the closing price on issue of 4/6/2014) Net assets acquired		85,293,067
	Recognised at
	acquisition	Carrying value
	US$	US$
Cash and cash equivalents	1,327,666	1,327,666
Trade and other receivables	349,013	349,013
Investment in associates	83,989,104(1)	1,366,798
	85,665,783	3,043,477
Trade and other payables	(372,716)	(372,716)
Fair value of identifiable net assets	**85,293,067 **	2,670,761

Cash inflow on acquisition Net cash at acquisition date Direct costs related to acquisition (1) Investment in associate at 31 December 2014 Investment in associate Share of associates net loss Share of foreign currency translation reserve	1,327,666 (1,093,842) 233,824 31 December 2014 US$ 83,989,104 (856,588) 64,825
	83,197,341

10. ISSUED CAPITAL

Issued and paid up capital:

30 June 2015 31 December 2014	30 June 2015 31 December 2014	30 June 2015 31 December 2014	30 June 2015 31 December 2014
Number	Number	US$	US$
134,252,237	111,973,237	124,708,862	113,900,141

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.

11

Notes to the Consolidated Financial Statements

Weighted average number of shares
	30 June 2015	31 December 2014
Weighted average number of ordinary shares used in calculating basic earnings per share	126,504,802	78,471,188
Effect of dilutive options		-
Adjusted weighted average number of ordinary shares used in calculating diluted earnings per share	126,504,802	78,471,188
Movements in contributed equity during the half year were as follows:
(a) Ordinary Shares	Number	US$
Opening balance at 1 January 2015	111,973,237	113,900,141
Shares issued under capital raising	22,279,000	11,762,803
Capital raising costs	-	(954,082)
Total shares on issue at 30 June 2015	**134,252,237 **	124,708,862

(b) Options

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

(a) Listed options Opening balance at 1 January 2015 Total options on issue at 30 June 2015	Number US$ 8,784,854 4,462,085
	8,784,854 4,462,085

The options on issue 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 dividend has been paid or provided for during the half year. (30 June 2014: nil)

12. LOANS TO ASSOCIATES

On 4 June 2014, RTG completed the implementation of the Schemes to acquire the outstanding securities of Sierra. Pursuant to the Schemes, RTG has acquired a direct 40% interest in each of Mt Labo Exploration & Development Corporate, St Ignatius Exploration and Mineral Resource Corporate, Bunawan Mining Corporation and Oz Metals Exploration and Development Corporation.

The total loan balance from acquisition date to 30 June 2015 was $4,846,352 and has funded a share of costs associated with the following:

• the preparation of the Maiden Resource Statement at the Mabilo Project;

• commencement of permitting for the initial planned oxide mining development at Mabilo;

• preparation of a feasibility study for the Mabilo Project;

• obtaining the Bunawan Project exploration permit; and

• completion of the December quarter Bunawan drilling program.

12

Notes to the Consolidated Financial Statements

Loans to associates	Reviewed Audited 30 June 2015 31 December 2014 US$ US$ 4,846,352 2,992,472
	4,846,352 2,992,472

These transactions were undertaken on commercial terms and conditions, except that: I. there is no fixed repayment; and

• II. no interest payable on the loans at present.

13. FINANCIAL INSTRUMENTS - 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 2015 and 31 December 2014..

At 30 June 2015
(Reviewed)
	Notes	Level 1	Level 2	Level 3	Total
		US$	US$	US$	US$
Available for sale
financial asset		-	-	-	-
Derivative financial
asset		-	-	-	-
Total financial assets
		-	-	-	-
At 31 December 2014
(Audited)
	Notes	Level 1	Level 2	Level 3	Total
		US$	US$	US$	US$
Available for sale
financial asset		-	-	1,841,854	1,841,854
Derivative financial
asset		-	-	1,330,228	1,330,228

Valuation methods and assumptions

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

13

Notes to the Consolidated Financial Statements

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 following table presents the changes in level 3 items for the period ended 30 June 2015 and 31 December 2014.

Opening balance at 1 January 2015 Convertible note Total financial assets Impairment At 30 June 2015 (Reviewed) Opening balance at 1 January 2014 Convertible note Total financial assets Acquisitions At 31 December 2014 (Audited)*	Available for sale financial assets US$ - 1,841,854	Derivative financial asset Total US$ US$ - - 1,330,228 3,172,082
	- (1,841,854)	- - (1,330,228) (3,172,082)
	- Available for sale financial assets US$ - 1,841,854	- - Derivative financial asset Total US$ US$ - - 1,330,228 3,172,082
	- -	- - - -
	1,841,854	1,330,228 3,172,082

*During the financial period, the Company has reviewed its investment and convertible note in Elephant Copper. The Company has adopted a conservative approach and on the recommendation of the Audit Committee, has decided to impair these assets to nil. The decision was based on a number of factors, including but not limited to, the fall in current market conditions and a lower copper price, which will potentially impact Elephant Coppers intended capital raising.

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
Contractual	Total	Less than 1 year	1-3 years	4-5 years	More than 5
obligations					years
Lease obligations1	206,550	206,550	-	-	-
Total contractual
obligations	206,550	206,500	-	-	-
1Corporate office lease payments due.

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

15. RELATED PARTY TRANSACTIONS

(a) Controlling entity

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

14

Notes to the Consolidated Financial Statements

(b) Other transactions with related parties

Transactions with related parties consist of companies with directors and officers in common and companies owned in whole or in part by executive officers and directors as follows for the three and six months ended June 30, 2015 and June 30, 2014:

Name Nature of transactions

Coverley Management Services Pty Ltd

Consulting as Director

The company paid the following fees in the normal course of operation in connection with companies owned by directors.

Directors fees Total	Unaudited Reviewed Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 17,043 14,424 29,780 27,806
	15,069 14,424 29,780 27,806

During the period 30 June 2015, the Company entered into transactions with related parties in the wholly-owned group:

• Loans of $28,242 were advanced on short term inter-company accounts; and

• Loans of $1,853,880 were advanced to associates, $1,236,071 for costs relating to Mt Labo Joint Venture, $532,220 to Bunawan Mining Corporation and $85,589 to Oz Metals Corporation.

These transactions were undertaken on the following terms and conditions:

• there is no fixed repayment ; and

• no interest is payable on the loans at present.

16. SEGMENTED INFORMATION

The Company’s operations are segmented on a regional basis and are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker who is responsible for allocating resources and assessing performance of the operating segments has been defined as the Chief Executive Officer.

The Company operates in a single segment, being mineral exploration and development with its exploration and evaluation held in the Philippines.

Six months to 30 June 2015 (Reviewed) Results Philippines 2015 Australia 2015 Other 2015 US$ US$ US$ Segment profit/(loss) before tax (1,072,379) (1,734,030) (3,207,853) Revenue - 1,241 - Administrative expenses - (1,222,191) (33,098) Foreign exchange - 163,810 (2,674) Share of associate profit/(loss) (1,072,378) - - Impairment available for sale financial assets - - (1,841,854) Impairment of derivative financial assets - - (1,330,228) Other expenses - (676,890) - Segment profit/(loss) before income tax as per statement of comprehensive income

Consolidated Total 2015 US$ (6,014,262) 1,241 (1,255,289) 161,136 (1,072,378) (1,841,854) (1,330,228) (676,890)

(6,014,262)

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Notes to the Consolidated Financial Statements

Results Philippines 2015 Australia 2015 Other 2015 US$ US$ US$ Depreciation expense - (14,723) - Six months to 30 June 2014 (Reviewed) Results Philippines Australia Other 2014 2014 2014 US$ US$ US$ Segment profit/(loss) before tax Revenue - 17,924 - Administrative expenses - (1,890,896) (196,002) Foreign exchange - (178,444) (803) Share of associate profit/(loss) (126,885) - - Other expenses - (725,439) 8,512 Total revenue as per statement of comprehensive income Depreciation - (15,694) -	Consolidated Total 2015 US$ Consolidated Total 2014 US$ (3,092,033) 17,924 (2,086,898) (179,247) (126,885) (716,927)
	(3,092,033)

The following is the geographical locations of the Company’s assets:

Philippines Australia Other Total	30 June 2015 31 December 2014 US$ US$ 86,270,041 86,189,813 10,081,305 3,070,688 27,152 3,206,763
	96,378,498 92,467,264

17. EVENTS SUBSEQUENT TO BALANCE DATE

Mt Labo Exploration and Development Corporation is currently in the process of renewing its exploration licence at the Mabilo Project with the process well advanced. The regional Mines and Geosciences Bureau has confirmed that all conditions have been met and it has been endorsed for signing by the Central office. The drilling contractor Galeo Equipment Corporation has temporarily suspended drilling while reviewing the drilling program in line with the EP renewal.

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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 2015 and of its performance for the six month period ended 30 June 2015; and

• (ii) comply with International Accounting Standards IAS 34 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.

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JUSTINE A MAGEE Director

Perth, 13 August 2014

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