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1 Intrepid Mines Limited ABN Interim financial report for the six months ended 30 June 2016

2 Table of Contents DIRECTORS REPORT 3 LEAD AUDITOR S INDEPENDENCE DECLARATION 5 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 6 CONSOLIDATED STATEMENT OF FINANCIAL POSITION 7 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 8 CONSOLIDATED STATEMENT OF CASH FLOWS 9 CONDENSED NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS 10 DIRECTORS' DECLARATION 13 INDEPENDENT AUDITOR S REVIEW REPORT 14 About this report This report is a summary of Intrepid Mines Limited s operations, activities and financial position for the six months ended 30 June It complies with Australian reporting requirements. An electronic version of this report is available at Printed reports are also available from Intrepid on request. About Intrepid Mines Limited Intrepid Mines Limited is an Australian-based minerals exploration and development company which is listed on the ASX (ASX code: IAU). Additional information is available on Intrepid s website: Page 2

3 DIRECTORS REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2016 The Directors present their report together with the consolidated financial statements of Intrepid Mines Limited ( the Company or Intrepid ) and of the Group, being the Company and the entities it controlled at the end of, or during, the six months ended 30 June 2016 and the auditor s review report thereon. DIRECTORS The following persons were directors of Intrepid Mines Limited during the whole of the half-year and up to the date of this report: Peter Love Richard Baumfield Peter Evans PRESENTATION CURRENCY Items included in the directors report and financial statements of the Group are presented in Australian dollars unless otherwise stated. REVIEW AND RESULTS OF OPERATIONS The directors provide the following comments on the operations of the Group for the half-year ended 30 June Exploration and evaluation activities Kitumba Project, Zambia (100%) A review of the Kitumba Project was commissioned by the new Board of Directors during the first quarter of The review was designed to determine whether the mining and processing concept that was contemplated in the updated Pre-Feasibility Study (refer ASX announcement dated 8 October 2015) is consistent with the most recent geological information and current market environment. The review was completed during the reporting period and has recommended some additional baseline work on the characterisation of the copper mineralisation (ore-typing) which would enable more conventional or streamlined processing options to be studied, with the intent to significantly reduce capital and operating costs of the project, reducing the risks associated with the future development of the property. The board will make a determination on the merits of carrying out the additional work recommended by the review when market conditions for new copper projects show a clear sign of improvement. Refer commentary provided in the Quarterly Activities report (refer ASX announcement dated 29 July 2016) for further detail. Mumbwa Exploration The exploration plan and budget for the 2016 drilling season was approved by the board in April 2016 with the commencement of drilling occurring on 31 May The program was designed to be in two distinct phases and focused on the Target H and Lulu targets. Phase 1 works included 1,100 metres of step-out drilling surrounding previous positive results at Target H (refer ASX announcements dated 16 November 2015 and 8 February 2016) as well as an Induced Polarisation (IP) geophysical survey covering the Lulu prospect, which is being explored under an option agreement with African Deposits Limited. Phase 2 was planned to include further drilling pending initial results from the phase 1 drilling and the IP geophysical survey. The 2016 exploration program was successfully completed subsequent to period end on 6 August 2016 with a total of 2,252 metres drilled across 11 holes at Target H (refer ASX announcement on this date for further detail). Page 3

4 The final core has been sent to the laboratory for chemical analysis with results expected prior to the end of quarter three Due to the highly oxidised and clay rich nature of the mineralisation identified in the near surface material at Target H, samples will also be submitted for metallurgical test work to determine whether the copper can be recovered successfully and economically. The outcome of these tests will then determine whether additional follow-up drilling should be undertaken. Financial results During the half-year the Group delivered a loss before income tax of $2,493,000 (1H 2015: $7,168,000). Net assets of the Group as at 30 June 2016 were $80,191,000 (31 Dec 2015: $84,385,000). Corporate The Company s Annual General Meeting was held on 31 May 2016 with all resolutions being passed. Refer to note 6 of the interim financial report for further detail in relation to the approved return of capital and share consolidation which were both completed subsequent to period end. ROUNDING The amounts contained in this report and in the financial report have been rounded to the nearest $1,000 (unless otherwise stated) under the option available to the Company under ASIC Class Order 2016/191. The Company is an entity to which the class order applies. DIVIDENDS No dividends have been declared, provided or paid in respect of the half-year period. LEAD AUDITOR S INDEPENDENCE DECLARATION The Lead Auditor s independence declaration under section 307C of the Corporations Act is set out on page 5 and forms part of the Directors Report for the six months ended 30 June This report is made in accordance with a resolution of directors. Peter Love Chairman Brisbane, Queensland 9 September 2016 Page 4

5 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: Fax: ey.com/au Auditor s Independence Declaration to the Directors of Intrepid Mines Limited As lead auditor for the review of Intrepid Mines Limited for the half-year ended 30 June 2016, I declare to the best of my knowledge and belief, there have been: a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and b) no contraventions of any applicable code of professional conduct in relation to the review. This declaration is in respect of Intrepid Mines Limited and the entities it controlled during the financial period. Ernst & Young Scott Jarrett Partner Sydney 9 September 2016 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Page 5

6 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2016 Six months ended 30 Jun 2016 Restated (1) Six months ended 30 Jun 2015 $ 000 $ 000 Income Other income Expenses Exploration and evaluation expenditure (1,541) (4,585) General and administrative expenses (847) (1,547) Integration and restructuring costs (147) (2,344) Share-based payments expense - (29) Foreign exchange gain/(loss) (352) 557 Profit / (loss) before income tax (2,493) (7,168) Income tax benefit Profit / (loss) for the period (2,451) (7,142) Other comprehensive income Foreign exchange translation differences 1,009 (2,002) Total comprehensive income / (loss) attributable to owners of the company (1,442) (9,144) Cents Cents Basic and diluted loss per share (0.70) (1.93) The condensed notes on pages 11 to 12 are an integral part of these consolidated interim financial statements. (1) Comparative balances have been restated to AUD as a result of a change in presentation currency. Refer to note 2d for further detail. Page 6

7 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016 Current assets Note 30 Jun Dec 2015 $ 000 $ 000 Cash and cash equivalents 50,641 55,932 Trade and other receivables 1,275 1,876 Total current assets 51,916 57,808 Non-current assets Property, plant and equipment Mining properties 4 28,850 27,707 Total non-current assets 28,903 27,797 TOTAL ASSETS 80,819 85,605 Current liabilities Trade and other payables Provisions Total current liabilities 628 1,220 TOTAL LIABILITIES 628 1,220 NET ASSETS 80,191 84,385 Equity Contributed equity 5 265, ,499 Reserves 39,807 38,798 Accumulated losses (225,363) (222,912) TOTAL EQUITY 80,191 84,385 The condensed notes on pages 11 to 12 are an integral part of these consolidated interim financial statements. Page 7

8 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2016 Consolidated Note Foreign currency Sharebased Profit Share translation payments appropriation Accumulated Total capital reserve reserve reserve losses equity $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 Balance at 1 January ,499 (14,742) 7,784 45,756 (222,912) 84,385 Total comprehensive loss for the period Profit / (loss) for the period (2,451) (2,451) Other comprehensive loss Foreign currency translation differences - 1, ,009 Total comprehensive income for the period 268,499 (13,733) 7,784 45,756 (225,363) 82,943 Transactions with owners, recorded directly in equity Share buyback, net of transaction costs 5 (2,752) (2,752) Balance at 30 June ,747 (13,733) 7,784 45,756 (225,363) 80,191 Restated (1) Balance at 1 January , ,684 45,756 (207,618) 114,431 Total comprehensive loss for the period Profit / (loss) for the period (7,142) (7,142) Other comprehensive income Foreign exchange translation differences - (2,002) (2,002) Total comprehensive income for the period 268,499 (1,892) 7,684 45,756 (214,760) 105,287 Transactions with owners, recorded directly in equity Share based payments made Balance at 30 June ,499 (1,892) 7,713 45,756 (214,760) 105,316 Amounts are stated net of tax. The condensed notes on pages 11 to 12 are an integral part of these consolidated interim financial statements. (1) Comparative balances have been restated to AUD as a result of a change in presentation currency. Refer to note 2d for further detail. Page 8

9 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2016 Cash flows used in operating activities Six months ended 30 Jun 2016 Restated (1) Six months ended 30 Jun 2015 $ $ Payment for exploration activities (1,747) (4,810) Payments to suppliers and employees (1,434) (4,384) Interest received 360 1,218 Income taxes (paid) / refund 129 (1,223) Release of funds previously held in trust Net cash used in operating activities (1,986) (9,199) Cash flows used in investing activities Proceeds from sale of exploration assets - 2,556 Payments for disposal of investments - (781) Payments for property, plant and equipment - (6) Proceeds from maturity of term deposits greater than three - 21,654 months Net cash used in investing activities - 23,423 Cash flows from financing activities Purchase of own shares through on market buyback 5 (2,730) - Transaction costs related to buyback 5 (22) - Net cash from financing activities (2,752) - Net increase/(decrease) in cash and cash equivalents (4,738) 14,224 Cash and cash equivalents at 1 January 55,932 24,144 Effect of exchange rate fluctuations on cash held (553) 333 Cash and cash equivalents at 30 June 50,641 38,701 The condensed notes on pages 11 to 12 are an integral part of these consolidated interim financial statements. (1) Comparative balances have been restated to AUD as a result of change in presentation currency. Refer to note 2d for further detail. Page 9

10 CONDENSED NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS Note Reporting entity Basis of preparation and changes to the Group s accounting policies Segment reporting Mining properties Share capital Events occurring after the reporting period Page 10

11 CONDENSED NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS 1. REPORTING ENTITY Intrepid Mines Limited (the Company or Intrepid ) is a company domiciled in Australia whose shares are publicly listed on the ASX (ASX code: IAU). The condensed consolidated interim financial report of the Company as at and for the six months ended 30 June 2016 comprises the Company and its subsidiaries (collectively, the Group ). The consolidated annual financial report of the Group as at and for the period ended 31 December 2015 is available upon request from the Company s registered office at Suite 2, 24 Bolton Street, Newcastle NSW 2300 or at 2. BASIS OF PREPARATION AND CHANGES TO THE GROUP S POLICIES a. Basis of preparation The condensed consolidated interim financial report for the half-year reporting period ended 30 June 2016 which has been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act This condensed consolidated interim financial report does not include all of the information and disclosures required in the annual financial report, and should be read in conjunction with the consolidated financial report of the Group as at and for the period ended 31 December b. Changes in accounting policies, accounting standards and interpretations The accounting policies applied by the Group in this condensed consolidated interim financial report are the same as those applied by the Group in its consolidated financial report as at and for the period ended 31 December c. Estimates The preparation of interim financial reports requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing this condensed consolidated interim financial report, the significant judgements made by management in applying the Group s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial report as at and for the period ended 31 December d. Change in presentation currency For the year ended 31 December 2015, the Company changed its presentation currency from United States dollars to Australian dollars. The presentation currency used in the previous interim financial report, being the six months ended 30 June 2015, was United States dollars. Therefore, where the six months ended 30 June 2015 is the relevant comparative period in this interim financial report, these amounts have been restated to Australian dollars using the following exchange rates: - An exchange rate of for balances as at the beginning of the period, being 1 January An exchange rate of for balances as at period end 30 June An average exchange rate of for balances reflecting transactions throughout the period Any individually significant transactions were restated based on the exchange rate at the transaction date. Page 11

12 CONDENSED NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS (continued) 3. SEGMENT REPORTING Consistent with the year ended 31 December 2015, the Group manages its operations as a single business operation and there are no parts of the business that qualify as separate operating segments under AASB 8 Operating Segments. The board assesses the financial performance of the Group on an integrated basis only and accordingly, the Group is managed on the basis of a single segment. Geographical information The geographical locations of the Group s non-current assets are Africa $28,895,000 and Australia $8,000 (31 December 2015: Africa $27,778,000 and Australia $19,000). 4. MINING PROPERTIES 30 Jun Dec 15 $ 000 $ 000 Balance at 1 January 27,707 42,487 Foreign exchange translation 1,143 (14,780) Balance at end of period 28,850 27,707 Exploration and evaluation assets consist of the following: Exploration properties (Zambia Mumbwa) 28,850 27, SHARE CAPITAL Movements in shares on issue during the period were as follows: 30 Jun Dec 15 Number of ordinary shares Number of ordinary shares On issue at 1 January 370,038, ,869,196 Share issue exercise of share rights - 169,100 Share buyback (22,761,447) - On issue at end of period fully paid 347,276, ,038, EVENTS OCCURRING AFTER THE REPORTING PERIOD On 25 August 2016, the Company completed a return of capital to shareholders of $0.07 per share, resulting in a total payment amount of $24,309,379. Subsequent to the return of capital, the Company implemented a share consolidation on 31 August 2016 whereby shareholders received one post-consolidation share for every twenty pre-consolidation shares held. The number of ordinary shares on issue post-consolidation is 17,363,035. Both the return of capital and share consolidation were approved by Intrepid shareholders at the Company s AGM held on 31 May Page 12

13 DIRECTORS' DECLARATION In accordance with a resolution of the directors of Intrepid Mines Limited, I state that: In the opinion of the directors: (a) The financial statements and notes of Intrepid Mines Limited for the half-year ended 30 June 2016 are in accordance with the Corporations Act 2001, including: (i) (ii) giving a true and fair view of the Group s financial position as at 30 June 2016 and of 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; and (b) 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 Peter Love Chairman Brisbane, Queensland 9 September 2016 Page 13

14 Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: Fax: ey.com/au Independent auditor s report to the members of Intrepid Mines Limited Report on the Half Year Financial Report We have reviewed the accompanying half year financial report of Intrepid Mines Limited, which comprises the consolidated statement of financial position as at 30 June 2016, the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors declaration of the consolidated entity comprising the company and the entities it controlled at the half year end or from time to time during the half year. Directors responsibility for the 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 controls as the directors determine are necessary to enable the preparation of the 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 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 2016 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 As the auditor of Intrepid Mines Limited and the entities it controlled during the half year, 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 We have given to the directors of the company a written Auditor s Independence Declaration, a copy of which is included in the directors report. Page 14

15 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 Intrepid Mines Limited 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 2016 and of its performance for the half year ended on that date; and b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations Ernst & Young Scott Jarrett Partner Sydney 9 September 2016 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Page 15

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For personal use only Intrepid Mines Limited ABN 11 060 156 452 Interim financial report for the six months ended 30 June 2017 Table of Contents DIRECTORS REPORT 3 LEAD AUDITOR S INDEPENDENCE DECLARATION 5 CONSOLIDATED STATEMENT