TALGA GROUP LTD — Interim / Quarterly Report 2018

Jul 30, 2018

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, 01/05/13, 01/09/16

Name of entity

Talga	Resources Ltd
ABN			Quarter ended (“current quarter”)
32 138 405 419			30 June 2018
Consolidated statement of cash flows			Current quarter		Year to date
			$A’000		(12 months)
					$A’000
1.	Cash flows from operating activities
1.1	Receipts from customers			-			4
1.2	Payments for
	(a) exploration & evaluation(i)			(213)	(1,415)
	(b) development(ii)		(1,323)		(4,560)
	(c) production			-			-
	(d) staff costs			(418)	(1,807)
	(e) administration & corporate costs	(iii)		(431)	(1,417)
1.3	Dividends received (see note 3)			-			-
1.4	Interest received			51		231
1.5	Interest and other costs of finance paid			-			-
1.6	Income taxes paid			-			-
1.7	Research and development refunds			165		165
1.8	Other - grants			22		154
1.9	Net cash from / (used in) operating		(2,147)		(8,645)
	activities

• See chapter 19 for defined terms 1 September 2016

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(12 months)
			$A’000
2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a) property, plant and equipment	(459)	(1,258)
	(b) tenements (see item 10)	-	-
	(c) investments	-	-
	(d) other non-current assets	-	-
2.2	Proceeds from the disposal of:
	(a) property, plant and equipment	-	-
	(b) tenements (see item 10)(iv)	-	130
	(c) investments	543	3,031
	(d) other non-current assets	-	-
2.3	Cash flows from loans to other entities	-	-
2.4	Dividends received (see note 3)	-	-
2.5	Other – Bond refund	59	59
	Other – Grants	194	260
2.6	Net cash from / (used in) investing	337	2,222
	activities
3.	Cash flows from financing activities
3.1	Proceeds from issues of shares(v)	1,150	1,150
3.2	Proceeds from issue of convertible	-	-
	notes
3.3	Proceeds from exercise of share options	455	874
3.4	Transaction costs related to issues of	-	-
	shares, convertible notes or options
3.5	Proceeds from borrowings	-	-
3.6	Repayment of borrowings	-	-
3.7	Transaction costs related to loans and	-	-
	borrowings
3.8	Dividends paid	-	-
3.9	Other – security issue costs	(4)	(4)
3.10	Net cash from / (used in) financing	1,601	2,020
	activities

• See chapter 19 for defined terms 1 September 2016

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Consolidated statement of cash flows	Consolidated statement of cash flows	Consolidated statement of cash flows		Current quarter	Year to date
				$A’000	(12 months)
					$A’000
4.	Net (decrease) in cash	and	cash
	equivalents for the period
4.1	Cash and cash equivalents at	beginning		12,146	16,340
	of period
4.2	Net cash from / (used in) operating			(2,147)	(8,645)
	activities (item 1.9 above)
4.3	Net cash from / (used in) investing			337	2,222
	activities (item 2.6 above)
4.4	Net cash from / (used in) financing			1,601	2,020
	activities (item 3.10 above)
4.5	Effect of movement in exchange rates			-	-
	on cash held
4.6	Cash and cash equivalents	at end	of	11,937	11,937
	period(v)

5.	Reconciliation of cash and cash	Current quarter	Previous quarter
	equivalents	$A’000	$A’000
	at the end of the quarter (as shown in
	the consolidated statement of cash
	flows) to the related items in the
	accounts
5.1	Bank balances	459	1,063
5.2	Call deposits	11,478	11,083
5.3	Bank overdrafts	-	-
5.4	Other security deposit	-	-
5.5	Cash & cash equivalents at quarter	11,937	12,146
	end (should equal item 4.6 above)(v)

Notes: (i) Exploration and evaluation includes both Sweden tenement renewal and exploitation permitting costs.

• (ii) Development includes UK product development and Germany test facility operations and feasibility studies.

(iii) Administration includes Sweden.

(iv) Funds received pursuant to the option and sale agreement over the West Australian Bullfinch gold project. Final sale proceeds of $250K was received subsequent to Jun’18.

(v) Total cash just after the year end amounted to around $ 19M as a result of the remaining $7.35M received subsequent to year end being the balance of funds pursuant to the placement as announced to ASX on 28 June 2018.

• See chapter 19 for defined terms 1 September 2016

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

6.	Payments to directors of the entity and their associates	Current quarter
		$A'000
6.1	Aggregate amount of payments to these parties included in	200
	item 1.2
6.2	Aggregate amount of cash flow from loans to these parties	-
	included in item 2.3
6.3	Include below any explanation necessary to understand the transactions included in
	items 6.1 and 6.2

Amounts under 6.1 include director’s remuneration.

7.	Payments to related entities of the entity and their associates	Current quarter
		$A'000
7.1	Aggregate amount of payments to these parties included in		-
	item 1.2
7.2	Aggregate amount of cash flow from loans to these parties		-
	included in item 2.3
7.3	Include below any explanation necessary to understand the transactions included in
	items 7.1 and 7.2

8.	Financing facilities available	Total facility	Amount drawn at
	Add notes as necessary for an	amount at quarter	quarter end
	understanding of the position	end	$A’000
		$A’000
8.1	Loan facilities	-	-
8.2	Credit standby arrangements	-	-
8.3	Other (please specify)	-	-
8.4	Include below a description of each facility above, including the lender, interest rate
	and whether it is secured or unsecured. If	any additional facilities have been entered
	into or are proposed to be entered into after quarter end, include		details of those
	facilities as well.

• See chapter 19 for defined terms 1 September 2016

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

9.	Estimated cash outflows for next quarter	$A’000
9.1	Exploration and evaluation(i)		350
9.2	Development(ii)		1,500
9.3	Production		-
9.4	Staff costs		420
9.5	Administration and corporate costs(iii)		350
9.6	Other –Trial mining		-
9.7	Total estimated cash outflows		2,620

Note:

(i) Exploration and evaluation includes both Sweden tenement renewal and exploitation licence costs.

(ii) Development includes UK product development and Germany test facility operations and feasibility studies.

(iii) Administration includes Sweden.

10.	Changes in	Tenement	Nature of	Interest at	Interest
	tenements	reference and	interest	beginning	at end of
	(items 2.1(b) and	location		of quarter	quarter
	2.2(b) above)
10.1	Interests in	Sweden -
	mining	Norrbotten County
	tenements and petroleum tenements	Jalkunen nr 3 Lautakoski nr 1	Tenement holder Tenement holder	100% 100%	0% 0%
	lapsed,	Suinavaara nr 1	Tenement holder	100%	0%
	relinquished or	Maltosrova nr 2	Tenement holder	100%	0%
	reduced	Mörttjärn nr 1	Tenement holder	100%	0%
10.2	Interests in	Sweden -
	mining	Norrbotten County
	tenements and petroleum	Airivaara nr 100	Tenement holder	0%	100%
	tenements
	acquired or
	increased

• See chapter 19 for defined terms 1 September 2016

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

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

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

Sign here: ............................................................ Date: 31 July 2018 (Company secretary)

Print name: Dean Scarparolo

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

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, 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. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. See chapter 19 for defined terms 1 September 2016

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