TITANIUM SANDS LIMITED — Interim / Quarterly Report 2003

Oct 30, 2003

PRECIOUS METALS AUSTRALIA LIMITED OUARTERLY REPORT SEPTEMBER 2003

31 October 2003

Companies Officer Australian Stock Exchange 2 The Esplanade PERTH WA 6000

Dear Sir

The Directors of Precious Metals Australia Limited have pleasure in submitting the Ouarterly Report for the period ended 30 September 2003.

$\blacksquare$ MINING MATTERS

WINDIMURRA

The Company continues to benefit from the Windimurra Royalty Agreement and, despite continuing low world vanadium prices, it is still entitled to a minimum royalty of \$500,000 per annum, which is payable in quarterly instalments of \$125,000.

PALM SPRINGS

The Company continues with the environmental rehabilitation of the Palm Springs tenements and has substantially completed the programme. The Company has undertaken a review of the status of the tenements and all the exploration data in order to assess the value and future of these tenements.

OTHER MINING AND EXPLORATION ACTIVITIES

There were no other mining or exploration activities during the quarter under review.

CORPORATE MATTERS

It is the intention of the Company to call a general meeting of shareholders during December 2003 to seek approval from shareholders to make certain placements of shares in order to provide working capital for the Company and to settle the outstanding loan accounts associated with the former directors Mr R J H Smith and Mr A K McKee.

Signed on behalf of the Board of Precious Metals Australia Limited.

Angus C Pilmer DIRECTOR

Appendix 5B

Rule 5.3

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

PRECIOUS METALS AUSTRALIA LIMITED

ABN

65 009 131 533

Quarter ended ("current quarter") SEPTEMBER 2003

Year to date

$(3$ months)

Current quarter

\$A'000

Consolidated statement of cash flows

Cash flows related to operating activities

			SA'000
1.1	Receipts from product sales and related debtors	250	250
1.2	Payments for (a) exploration and evaluation (b) development (c) production (d) administration	(251)	(251)
1.3 1.4 1.5 1.6 1.7	Dividends received Interest and other items of a similar nature received Interest and other costs of finance paid Income taxes paid Other	3	3
	Net Operating Cash Flows	2	2
1.8 1.9 1.10 1.11 1.12	Cash flows related to investing activities Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets Proceeds from sale of: (a)prospects (b) equity investments (c) other fixed assets Loans to other entities Loans repaid by other entities Other	5	5
	Net investing cash flows	5	5.
1.13	Total operating and investing cash flows (carried forward)	7	7

⁺ See chapter 19 for defined terms.

1.13	Total operating and investing cash flows (brought forward)
1.14 1.15 1.16 1.17 1.18 1.19	Cash flows related to financing activities Proceeds from issues of shares, options, etc. Proceeds from sale of forfeited shares Proceeds from borrowings Repayment of borrowings Dividends paid Other
	Net financing cash flows
	Net increase (decrease) in cash held
1.20 1.21	Cash at beginning of quarter/year to date Exchange rate adjustments to item 1.20	74	74
1.22	Cash at end of quarter	81	81

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

		Current quarter \$A'000
1.23	Aggregate amount of payments to the parties included in item 1.2	NIL
1.24	Aggregate amount of loans to the parties included in item 1.10	NIL

1.25 Explanation necessary for an understanding of the transactions

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

$N/A$

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

$\rm N/A$

⁺ See chapter 19 for defined terms.

Financing facilities available
Add notes as necessary for an understanding of the position.

		Amount available SA'000	Amount used \$A'000
-3.1	Loan facilities
3.2	Credit standby arrangements

Estimated cash outflows for next quarter

	Total	NIL
4.2	Development
4.1	Exploration and evaluation
		\$A'000

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 SA'000
5.1	Cash on hand and at hank	81	74.
5.2	Deposits at call
5.3	Bank overdraft
5.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	81	74

Changes in interests in mining tenements

		Tenement	Nature of interest	Interest at	Interest at
		reference	(note (2))	beginning	end of
				of quarter	quarter
-6.1	Interests in mining tenements relinquished, reduced or lapsed	N/A
6.2	Interests in mining tenements acquired or increased	N/A

⁺ See chapter 19 for defined terms.

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 note	Amount paid up per security (see note 3)
				3) (cents)	(cents)
7.1	Preference i securities
	(description)
7.2	Changes during
	quarter
	(a) Increases
	through issues
	(b) Decreases
	through returns
	of capital, buy- backs,
	redemptions
7.3	*Ordinary	15,854,855	15,854,855
	securities
7.4	Changes during
	quarter
	(a) Increases through issues
	(b) Decreases
	through returns
	of capital, buy-
	backs
7.5	*Convertible	NIL
	debt securities (description)
7.6	Changes during
	quarter
	(a) Increases
	through issues
	(b) Decreases
	through securities
	matured,
	converted
7.7	Options			Exercise price	Expiry date
	(description and	12,896,334	12,896,334	\$2.00	1 December 2005
	conversion factor)
7.8	Issued during
	quarter
7.9	Exercised during
	quarter
7.10	Expired during
7.11	quarter Debentures
	(totals only)
7.12	Unsecured
	notes (totals
	only)

$+$ See chapter 19 for defined terms.

Compliance statement

• $\mathbf{I}$ 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 4).
• $\overline{2}$ This statement does give a true and fair view of the matters disclosed.

Sign here:
	(Director/Company secretary)

Print name: $\mathcal A$ C PILMER

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⁺ See chapter 19 for defined terms.