SABRE RESOURCES LIMITED — Interim / Quarterly Report 2004

Mar 10, 2004

SABRE RESOURCES LTD

A.C.N. 003 043 570

Half Yearly Report31 December 2003

HALF YEAR REPORT For the Half Year Ended 31 December 2003

Company Directory	3.
Directors' Report	4
Condensed Statement of Financial Performance	6
Condensed Statement of Financial Position	7
Condensed Consolidated Statement of Cash Flows	8
Notes to the Financial Statements	9
Directors' Declaration	11
Independent Review Report	12.

COMPANY DIRECTORY

DIRECTORS

David Zukerman

Alexander Clemen

Bruce Russell McCullagh

COMPANY SECRETARY

Bruce Russell McCullagh

REGISTERED OFFICE

1st Floor, 8 Parliament Place WEST PERTH WA 6005

Telephone:	$(08)$ 9481 7833
Facsimile:	$(08)$ 9481 7835

SHARE REGISTRY

Computershare Investor Services Level 2, Reserve Bank Building 45 St Georges Terrace PERTH WA 6000

AUDITORS

Stanton Partners $1st$ Floor Havelock Street WEST PERTH WA 6005

STOCK EXCHANGE LISTING

The Company is listed on the Australian Stock Exchange Limited Home Exchange: Perth, Western Australia

Australian Stock Exchange Limited Code: SBR

DIRECTORS' REPORT For the Half Year Ended 31 December 2003

The Board of Directors of Sabre Resources Ltd submit their report together with the consolidated financial accounts of the Company and its subsidiary for the half year ended 31 December 2003.

DIRECTORS

The names of directors of the Company in office during or since the end of the half year are:

Name

DN Zukerman	- Appointed August 18, 2003
RJ Collins	- Resigned August $18, 2003$
A Clemen

BR McCullagh

MEETINGS OF DIRECTORS

The following table sets out the number of meetings of the chief entity's Directors held during the half year ended 31 December 2003 and the number of meetings attended by each Director.

Name:	Eligible to Attend	Attended
RJ Collins
A Clemen
B McCullagh
DN Zukerman

REVIEW OF OPERATIONS

Exploration concentrated on a detailed analysis of the Company's tenements in the Jitarning area, some 250 kilometres to the south east of Perth, in the Western Australian wheat-belt. The tenements overlie the recently recognized Corrigin greenstone belt.

Jitarning North-West (E 70/2381) is located 15 kilometres to the south west of Kulin township. Work included reconnaissance roadside sampling. Infill soil sampling will be carried out in several locations to follow up on elevated gold geochemistry. In addition, multi-element geochemistry will be undertaken to better define interpreted ultramafic units with the stratigraphy, and their nickel sulphide potential.

DIRECTORS' REPORT For the Half Year Ended 31 December 2003

Jitarning South-East (E 70/2382) is located 26 kilometres to the north west of Lake Grace township and lies on the recently recognized Corrigin greenstone belt. The tenement was soil sampled in recent programs and previous drilling by another party recorded 4 metres $\hat{\omega}$ 0.2gpt gold near the bottom of drill holes. This drilling is currently being analysed with a view to follow-up drilling on the prospect as holes do not seem to have been effective in testing either the surface anomaly or the bedrock geochemistry.

Neendaling (E 70/2383) is located 14 kilometres to the northwest of Lake Grace township and adjacent to the previously mined Griffin's Find open pit. This tenement lies on the recently recognized Corrigin greenstone belt. Soil sampling has been undertaken by Sabre Resources and further infill soil sampling is planned in this tenement area.

RESULTS

The loss of the company for the half year was $111,650.

DIRECTORS' SHAREHOLDINGS

At the date of this report the interests of the directors in the shares of the company were:-

Director	Interest	Shares
A Clemen	Direct	10
BR McCullagh	Direct	20
DN Zukerman	Direct	10

DIRECTORS' BENEFITS

Since the end of the previous financial year, no director has received or become entitled to receive a benefit, other than benefits disclosed in the financial statements of the fixed salary of a full-time employee of the company or a related body corporate, by reason of a contract made by the company or a related body corporate with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest, except as follows:-

• Mr McCullagh received payments for the provision of services to the Company.

This report has been made in accordance with a resolution of Directors.

D N Zukerman Director Perth, 10th March 2004

CONDENSED STATEMENT OF FINANCIAL PERFORMANCE For the Half Year Ended 31 December 2003

	Note	Consolidated31 December2003S	Consolidated31 December2002S
Revenue from ordinary activities
Sale of shares		54,000
Interest income		437	8,635
		54,437	8,635
Operating Costs
Depreciation		2,034	2,034
Management fees		50,112	48,747
Cost of shares sold		37,000
Exploration expenditure		7,825	17,531
Directors fees and services		23,401	35,250
Other operating costs		45,715	54,276
		166,087	157,838
Loss from ordinary activities beforeincome tax		(111, 650)	(149,203)
Income tax expense
Loss from ordinary activities afterincome tax expense	$\overline{2}$	(111, 650)	(149,203)
Basic loss per share - cents	3	(0.74)	(0.99)

Diluted loss per share has not been disclosed as the notional exercise of options over ordinary shares would not show an inferior view of the basic loss per share and as such they are not considered dilutive.

The accompanying notes form an integral part of this statement of financial performance.

CONDENSED STATEMENT OF FINANCIAL POSITION At 31 December 2003

	Note	Consolidated31 December2003$	Consolidated30 June2003Ŝ	Consolidated31 December2002Ŝ
CURRENT ASSETS
Cash assets		31,999	55,487	302,097
Receivables		2,542	11,133	7,543
TOTAL CURRENT ASSETS		34,541	66,620	309,640
NON-CURRENT ASSETS
Plant and equipment		3,052	5,086	7,120
Investment in listed entity			37,000
TOTAL NON-CURRENT ASSETS		3,052	42,086	7,120
TOTAL ASSETS		37,593	108,706	316,760
CURRENT LIABILITIESPayables		47,605	7,068	4,000
TOTAL CURRENT LIABILITIES		47,605	7,068	4,000
TOTAL LIABILITIES		47,605	7,068	4,000
NET (LIABILITIES)/ASSETS		(10, 012)	101,638	312,760
EQUITY
Contributed equity		14,417,457	14,417,457	14,417,457
Accumulated losses	$\overline{2}$	(14, 427, 469)	(14,315,819)	(14, 104, 697)
TOTAL (DEFICIT)/EQUITY		(10, 012)	101,638	312,760

The accompanying notes form an integral part of this statement of financial position.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS For the Half Year Ended 31 December 2003

	31 December2003S	31 December2002S
Cash Flows from Operating Activities
Payments to suppliersInterest received	(70, 190)520 F	(134,007)7,811
Net cash used in operating activities	(69, 670)	(126, 196)
Cash Flows from Investing Activities
Payment for exploration expenditureProceeds from sale of shares	(7,818)54,000	(17, 532)
Net cash from/(used in) investing activities	46,182	(17, 532)
Net Decrease in Cash Held	(23, 488)	(143, 728)
Cash at Beginning of the Period	55,487	445,825
Cash at the End of the Period	31,999	302,097

The accompanying notes form an integral part of this statement of cash flows.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

$\mathbf{1}$ . BASIS OF PREPARATION

The half-year consolidated financial statements are a general purpose financial $(a)$ report prepared for the half year ended 31 December 2003 in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standard AASB 1029: Interim Financial Reporting, Urgent Issues Group Consensus Views and other authoritative pronouncements of the Australian Accounting Standards Board. It is recommended that this report should be read in conjunction with the 30 June 2003 Annual Report and any public announcements made by Sabre Resources Limited during the half-year in accordance with the continuous disclosure obligations of the Corporations Act 2001.

The accounting policies applied by the Company are consistent with those of the previous financial year and corresponding half year.

For the purpose of preparing these half year financial statements, the half year has been treated as a discrete reporting period.

The half-year report does not include full disclosures of the type normally included in an annual financial report.

The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate funding for existing commitments and new ongoing business activities.

$2.$ ACCUMULATED LOSSES

	Consolidated31 December2003S	Consolidated31 December2002S
Accumulated losses at the start ofthe period	(14,315,819)	(13,955,494)
Loss for the six month period	(111,650)	(149,203)
Accumulated losses at the end ofthe half year	(14,427,469)	(14, 104, 697)

3. EARNINGS PER SHARE

Weighted average number of shares on
issue during the period used in the
calculation of basic earnings per share.	15,094,851	15,094,851

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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

$5.$ Events Subsequent to Reporting Date

On February 26, 2004 Sabre Resources Ltd issued 2,500,000 fully paid ordinary shares at an issue price of 8 cents each, also 10,000,000 options were issued at one cent each, to raise a total of $300,000 for continuing resources exploration and general working capital. The shares and options were issued pursuant to resolution of shareholders approved at the Annual General Meeting on November 27, 2003.

6. Segment Reporting

The company operates in Western Australia and is involved in the resources industry.

7. Commitments

Management Agreement.

The Company has a Management Agreement with a management services company for the provision of services at $90,000 per annum plus CPl. Charges are at commercial terms in accordance with the agreement entered into effective June $1st$ , 2000 for a five year term.

DIRECTORS' DECLARATION

The Directors of the company declare that:

• $1.$ The financial statements and notes, as set out on pages 6 to 10:
  • comply with Accounting Standards, the Corporations Regulations and other $(a)$ mandatory reporting requirements; and
  • (b) give a true and fair view of the consolidated entity's financial position as at 31 December 2003 and performance as represented by the results of its operations and its cash flows for the half year ended on that date.
• $2.$ In the Directors' opinion:
  • there are reasonable grounds to believe that the company will be able to pay its $(a)$ debts as and when they become due and payable.
  • the financial statements and the notes thereto are in accordance with the $(b)$ Corporations Act 2001.

SIGNED in accordance with a resolution of the Directors on behalf of the Board.

S.

D N Zukerman DIRECTOR

Perth 10th March 2004

INDEPENDENT REVIEW REPORT

STANTON PARTNERS

1 HAVELOCK STREET WEST PERTH 6005 WESTERN AUSTRALIA

TELEPHONE: (08) 9481 3188

Facsimile: (08) 9321 1204

e-mail: australia@stanton.com.au

INDEPENDENT REVIEW REPORT TO THE MEMBERS OF SABRE RESOURCES LIMITED

Scope

We have reviewed the financial report of Sabre Resources Limited for the half-year ended 31 December 2003 as set out on pages 6 to 11. The financial report includes the consolidated financial statements of the consolidated entity comprising the disclosing entity and the entities it controlled at the end of the half year or from time to time during the half year. The disclosing entity's directors are responsible for the financial report. We have performed an independent review of the financial report in order to state whether, on the basis of the procedures described. anything has come to our attention that would indicate that the financial report is not presented fairly in accordance with Accounting Standard AASB 1029: Interim Financial Reporting and other mandatory professional reporting requirements in Australia and statutory requirements, so as to present a view which is consistent with our understanding of the consolidated entity's financial position, and performance as represented by the results of its operations and its cash flows, and in order for the disclosing entity to lodge the financial report with the Australian Securities and Investments Commission.

Our review has been conducted in accordance with Australian Auditing and Assurance Standards applicable to review engagements. A review is limited primarily to inquiries of the disclosing entity's personnel and analytical procedures applied to the financial data. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than that given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

INDEPENDENT REVIEW REPORT

Statement

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the financial report of Sabre Resources Limited is not in accordance with:

• the Corporations Act 2001, including: $(a)$
  • (i) giving a true and fair view of the consolidated entity's financial position as at 31 December 2003 and of its performance for the half year ended on that date; and
  • (ii) complying with Accounting Standard AASB 1029 "Interim Financial Reporting" and the Corporations Regulations 2001; and
• $(b)$ other mandatory financial reporting requirements in Australia.

Inherent Uncertainty Regarding Continuation as a Going Concern

Without qualification to the audit review opinion expressed above, attention is drawn to the following matter. The ability of the Company and of its subsidiary to continue as going concerns and meet their planned exploration, administration, and other commitments is dependent upon the Company and its subsidiaries raising further working capital, and/or commencing profitable operations. In the event that the Company cannot raise further equity, the Company may not be able to meet its liabilities as and when they fall due.

STANTON PARTNERS

Stention Scentiers $g_{\text{Var}}$

J P Van Dieren Partner

West Perth, Western Australia 10 March 2004