Rarex Limited Financial Statements For Half Year Ended 31 December 2022

DIRECTORS’ REPORT

The Board of Directors have pleasure in presenting its interim consolidated report of RareX Limited (RareX or the Company) and its controlled entities (the Group or consolidated entity) for the half year ended 31 December 2022.

1. DIRECTORS

The names of the Company’s Directors in office during the half year and until the date of this report are set out below. Directors were in office for this entire period unless otherwise stated.

Mr John Young
Mr Jeremy Robinson
Mr Danny Goeman (appointed 1 March 2023)
Mr Shaun Hardcastle
Mr Cameron Henry

2. PRINCIPAL ACTIVITIES

The principal activities of the Group are mineral exploration and development. No significant change in the nature of these activities occurred during the half year.

3. REVIEW OF OPERATIONS

During the half year, the Company continued its exploration programs at the Cummins Range Rare Earths Project, Western Australia, with key points being:

• Release of a positive scoping study for the Cummins Range Project;
  
• 2022 drilling program completed with 16,000m drilled to support on-going metallurgical studies of a highly successful 6,000m RC and diamond drill program; and
• Outstanding wide rare earths-phosphate intercepts paving the way for pivotal resource upgrade at Cummins Range in 2023.

4. FINANCIAL RESULTS

The loss of the Group for the period ended 31 December 2022 was $4,091,878 (six months to 31 December 2021: loss of $4,721,568). During the half year, total expenses amounted to $6,264,530 (six months to 31 December 2021: $7,946,802).

Unrestricted cash and cash equivalents amounted to $1,740,065 as at 31 December 2022 (30 June 2022: $8,232,977).

5. EVENTS SUBSEQUENT TO THE END OF THE REPORTING PERIOD

There are no matters or circumstances which have arisen since the end of the half year which significantly affected or may significantly affect the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in subsequent financial periods, other than:

• On 10 February 2023, the Company issued 18,000,000 performance rights, vesting on various milestones, to employees under the Company’s Employee Securities Incentive Plan;
  
• On 14 February 2023, $2,141,754 was received from the ATO in respect of a Research and Development grant; and
• On 1 March 2023, the Company issued 4.500,000 unquoted options exercisable at $0.10 on or before 1 March 2026 to newly appointed non-executive director, Mr Danny Goeman.

6. AUDITOR’S INDEPENDENCE DECLARATION

The auditor’s independence declaration under Section 307C of the Corporations Act 2001 is set out on page 3 and forms part of the Directors’ Report for the half year ended 31 December 2022.

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