Forte Energy NL
LSE : FTE

March 14, 2012 06:54 ET

Half year financial report

                                                       1



                                                                                                               
                                               FORTE  ENERGY  NL
                                                       
                                                       
                                                       
                                              ABN 59 009 087 852
                                                       
                                                       
                                                       
                                                       
                                                       
                                                       
                                          HALF-YEAR FINANCIAL REPORT
                                                       
                                                       
                                               31 DECEMBER 2011
                                                       
                                                       
                                                       
                                                       
                                                Forte Energy NL
                                                Suite 3 Level 3
                                                1292 Hay Street
                                              West Perth WA 6005
                                                   AUSTRALIA
                                                       
                                                       
                                                       
                                                       
                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                                       
                                                       
                                                   CONTENTS







        Directors' Report                                                                                2

        Consolidated Statement of Comprehensive Income                                                   5

        Consolidated Statement of Financial Position                                                     6

        Consolidated Statement of Changes in Equity                                                      7

        Consolidated Statement of Cash Flow                                                              8

        Notes to the Half-Year Financial Report                                                          9

        Directors' Declaration                                                                          17

        Auditor's Independence Declaration                                                              18

        Independent Review Report                                                                       19





                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                               DIRECTORS' REPORT
                                                       

The  Board of Directors of Forte Energy NL present their half-year report on the Consolidated Entity consisting
of  Forte Energy NL ("the Company" or "Forte Energy") and the entities it controlled at the end of, or  during,
the half-year ended 31 December 2011 ("Consolidated Entity" or "Group").

Directors

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

Glenn Robert Featherby - Chairman
Lady Barbara Judge- Deputy Chairman
Mark David Reilly - Managing Director
Christopher David Grannell - Non-executive Director
Bosse Gustafsson - Technical Director

Review and Results of Operations

The Consolidated Entity reported a loss for the half-year of $1,289,810 (2010: $1,150,674).

The  principal activity of the Consolidated Entity during the reporting period was the exploration for  mineral
resources.

The  Consolidated Entity continues to investigate resource opportunities. Currently these are  focused  on  the
Consolidated  Entity's uranium exploration licences in West Africa in the Republic of Guinea  and  the  Islamic
Republic of Mauritania.

Uranium Exploration - Mauritania

    *   In September, Forte Energy announced the granting of two new uranium exploration permits, Licences 948
        and 949, in Mauritania. Known as Hassi Baida and Gin Ouissat, the licences cover 1,790 km2 and are located near
        the Consolidated Entity's existing licences in the north of the country. An initial 3,000m Reverse Circulation
        ("RC") drilling programme is currently underway to test several near to surface calcrete deposits within Hassi
        Baida.

    *   During the half-year, a follow-up RC drilling programme comprising 63 holes for 8,567m commenced at
        the A238 Prospect. Drilling has been completed and the majority of assay results received. A238 Prospect
        currently has a JORC resource of 26Mt @ 256ppm U3O8 for 14.9Mlbs contained U3O8 (100ppm cut off) and a revised
        JORC resource is expected by the end of March 2012.

    *   Assay results received so far from the RC drilling at A238 include:
            o       RC133:          25m @ 421ppm U3O8
            o       RC134:          16m @ 445ppm U3O8
            o       RC140:          10m @ 601ppm U3O8
            o       RC143:          10m @ 572ppm U3O8 & 6m @  489ppmU3O8
            o       RC148:          22m @ 377ppm U3O8
            o       RC150:          15m @ 450ppm U3O8 & 12m @ 449ppm U3O8
            o       RC152:          24m @ 371ppm U3O8
                                                       
    *   Extensive field surveys were carried out including mapping and trenching at the Tisram (284) licence,
        identifying over 31 radiometric surface anomalies.

                                                       
                                                       
Uranium Exploration - Guinea

    *   Following the 2011 wet season, rehabilitation and access works on roads and bridges was undertaken,
        including two substantial deviations around collapsed bridges on the main road into Firawa. Preparations were
        completed for the 2011-12 drilling programme.

    *   A  4,712m RC programme at the Firawa project has been completed with 63 holes drilled with initial
        indications confirm extensions along strike to the east and west of the existing central resources.

    *   Final assay results are expected in May, with compilation of the Firawa resource upgrade, currently
        17.7Mt @ 296ppm U3O8 for 11.6Mlbs contained U3O8 (100ppm cut off), scheduled for completion by the end of June
        2012.

    *   A follow-up programme of RC drilling at Bohoduo consisting of 17 holes totalling 1,277m has also been
        completed. The holes were drilled over a strike length of 8km and 9 of the holes have identified mineralisation
        from surface down to 80m. This potentially extends the mineralised zone to over 3km strike length. Assay
        results are expected in April 2012.

    *   A preliminary study of the baseline environmental and social impact assessment for Firawa has been
        completed by SGS Laboratory Services Ghana Ltd.

Corporate

    *   In July 2011 Forte Energy announced the appointment of Mr Scott Yelland as Chief Operating Officer to
        expedite the Consolidated Entity's exploration programmes in West Africa.

Events subsequent to balance date

On  6  February  2012  the  Consolidated  Entity announced that it had  been  granted  two  additional  uranium
exploration permits in Mauritania, West Africa: Licences 1588 - Nord Tmeimichat Rhall Amane and 1173 - Bir Ould
Ben Nasser.  The licences cover an area of 1,325km2 and are located near the Company's existing licences in the
north of the country.

The  Company now holds ten uranium exploration permits within Mauritania for a combined area of over  9,925km2,
in addition to its Firawa and Bohoduo uranium prospects in Guinea, which total 847km2.

Apart from other events to the extent to which are described elsewhere in this Director's Report, there has not
arisen  in  the  interval between the end of the financial period and the date of this report any  other  item,
transaction or event of a material or unusual nature likely, in the opinion of the Directors of the Company, to
effect:

    i.      the Consolidated Entity's operations in future financial years; or
    ii.     the results of those operations in future financial years; or
    iii.    the Consolidated Entity's state of affairs in future financial years.

Dividends

No dividend has been paid during the period (2010:  $ nil).

                                                       

AUDITOR'S INDEPENDENCE DECLARATION

A  copy of the Auditor's Independence Declaration as required under section 307C of the Corporations Act is set
out on page 18 and forms part of this report.

Signed in accordance with a resolution of the directors.






Mark Reilly
Managing Director

London 14 March 2012



Note:

The  information  in this report that relates to Exploration Results is based on information  compiled  by  Mr.
Bosse Gustafsson, who is a Member of the European Federation of Geologists, a 'Recognised Overseas Professional
Organisation'  ('ROPO') included in a list promulgated by the ASX from time to time. Mr Gustafsson  is  a  full
time  Technical  Director of Forte Energy NL and is responsible for exploration activities  in  Mauritania  and
Guinea.  Mr. Gustafsson has sufficient experience which is relevant to the style of mineralisation and type  of
deposit  under  consideration and to the activity which he is undertaking to qualify as a Competent  Person  as
defined  in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral  Resources
and  Ore  Reserves'.  Mr.  Gustafsson consents to the inclusion in this report of  the  matters  based  on  his
information in the form and context in which it appears.

The information in this report that relates to the Mineral Resource at the A238 prospect in Mauritania is based
on  information compiled by Mr. Bosse Gustafsson or Forte Energy NL and Mr Galen White BSc (hons) FGS, MAUSIMM,
Principal Geologist of CSA Global Inc (UK). The information in this report that relates to the Mineral Resource
at Bir En Nar in Mauritania is based on information compiled by Mr. Bosse Gustafsson of Forte Energy NL and Mr.
Neil Inwood of Coffey Mining Ltd. The information in this report that relates to the Mineral Resource at Firawa
in  Guinea  is based on information compiled by Mr. Bosse Gustafsson of Forte Energy NL and Mr. Doug Corley  of
Coffey Mining Ltd.

Mr.  Gustafsson, Mr. Corley, Mr. Inwood and Mr. White have sufficient experience which is relevant to the style
of  mineralisation  and type of deposit under consideration and to the activity which they have  undertaken  to
qualify  as  a  Competent  Person as defined in the 2004 Edition of the "Australasian  Code  for  Reporting  of
Exploration Results, Mineral Resources and Ore Reserves". Mr. Gustafsson, Mr. Corley, Mr. Inwood and Mr.  White
consent  to  the inclusion in this report of the matters based on their information in the form and context  in
which it appears.


                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                                       
                                CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                   FOR THE HALF-YEAR ENDED 31 DECEMBER 2011
                                                       
                                                       
                                                            Notes          2011                  2010
                                                                            $                     $
                                                                                                          
                                                                                                          
 Revenue                                                       4             216,315                94,725
 Exploration expenses                                                       (46,858)               (1,455)
 Administrative expenses                                       5         (1,446,226)           (1,233,835)
                                                                                                          
 Loss before income tax                                                  (1,276,769)           (1,140,565)
 Income tax expense                                                         (13,041)              (10,109)
                                                                                                          
 Loss after income tax                                                   (1,289,810)           (1,150,674)
                                                                                                          
                                                                                                          
 Net loss for the period                                                 (1,289,810)           (1,150,674)
                                                                                                          
 Other comprehensive income
 Gain/(loss) on available-for-sale financial assets, net                     (9,303)                   734
 of tax
 Impairment loss transferred to loss for the period                           11,260                     -
 Foreign currency translation                                               (40,524)              (10,011)
 Other comprehensive income for the period net of tax                       (38,567)               (9,277)
                                                                         (1,328,377)           (1,159,951)
 TOTAL COMPREHENSIVE INCOME FOR THE PERIOD ATTRIBUTABLE
 TO MEMBERS OF FORTE ENERGY NL
                                                                                                          
                                                                                                          
 Loss per share for loss attributable to the ordinary
 equity holders of the Company (cents per share)
 - basic loss per share                                                       (0.19)                (0.20)
 - diluted loss per share                                                     (0.19)                (0.20)
                                                                                                          


This statement of comprehensive income should be read in conjunction with the accompanying notes.


                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
                                            AS AT 31 DECEMBER 2011
                                                       


                                                    Notes      31 December 2011            30 June 2011
                                                                       $                        $
 ASSETS                                                                                                  
 Current Assets                                                                                          
 Cash and cash equivalents                            6                 4,782,456               8,716,949
 Trade and other receivables                                              508,227                 486,848
 Prepayments                                                              297,272                  56,926
                                                                        5,587,955               9,260,723
 Non-current assets classified as held for sale       7                   144,231                 132,776
 Total Current Assets                                                   5,732,186               9,393,499
                                                                                                         
 Non-current assets                                                                                      
 Available-for-sale financial assets                                       12,220                  21,523
 Exploration and evaluation expenditure               9                25,191,403              22,758,353
 Plant and equipment                                                      268,580                 212,496
 Total Non-Current Assets                                              25,472,203              22,992,372
                                                                                                         
 TOTAL ASSETS                                                          31,204,389              32,385,871
                                                                                                         
 LIABILITIES                                                                                             
 Current Liabilities                                                                                     
 Trade and other payables                                                 814,172                 739,290
 Income tax payable                                                        35,691                  33,388
 Provisions                                                                65,406                  66,079
                                                                          915,269                 838,757
 Liabilities associated with assets held for sale     7                       154                     484
 Total Current Liabilities                                                915,423                 839,241
                                                                                                         
 TOTAL LIABILITIES                                                        915,423                 839,241
                                                                                                         
 NET ASSETS                                                            30,288,966              31,546,630
                                                                                                         
 EQUITY                                                                                                  
 Contributed equity                                   11               81,287,225              81,287,225
 Reserves                                                               2,349,754               2,317,608
 Accumulated losses                                                  (53,348,013)            (52,058,203)
                                                                                                         
 TOTAL EQUITY                                                          30,288,966              31,546,630
                                                       
                                                       
This statement of financial position should be read in conjunction with the accompanying notes.


                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                  CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                                   FOR THE HALF -YEAR ENDED 31 DECEMBER 2011
                                                       
                
                            Contributed    Accumulated    AFS financial     Equity        Foreign        Total
                               equity        losses          assets        benefits      currency       equity
                                                             reserve        reserve     translation        
                                 $              $               $              $             $             $
                                                                                                           
 At 1 July 2011               81,287,225   (52,058,203)          (1,957)    2,331,334      (11,769)     31,546,630
                                       -    (1,289,810)                -            -             -    (1,289,810)
 (Loss) for the period
 Other comprehensive                   -              -            1,957            -      (40,524)       (38,567)
 income
 Total comprehensive                   -    (1,289,810)            1,957            -      (40,524)    (1,328,377)
 income for the half year
 net of tax
                                                                                                                  
 Equity transactions:
 Share-based payment                   -              -                -       70,713             -         70,713
 Balance At                   81,287,225   (53,348,013)                -    2,402,047      (52,293)     30,288,966
 31 December 2011
                                                                                                           
 
 At 1 July 2010               67,486,567   (49,645,222)          (9,542)    2,303,522       (1,763)     20,133,562
                                       -    (1,150,674)                -            -             -    (1,150,674)
 (Loss) for the period
 Other comprehensive                   -              -              734            -      (10,011)        (9,277)
 income
 Total comprehensive                   -    (1,150,674)              734            -      (10,011)    (1,159,951)
 income for the half year
 net of tax
                                                                                                                  
 Equity transactions:
 Share-based payment                   -              -                -       36,257             -         36,257
 Exercise of options             110,000              -                -            -             -        110,000
 Transaction costs               (1,543)              -                -            -             -        (1,543)
 Balance At                   67,595,024   (50,795,896)          (8,808)    2,339,779      (11,774)     19,118,325
 31 December 2010
                                                       

This statement of changes in equity should be read in conjunction with the accompanying notes.


                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                      CONSOLIDATED STATEMENT OF CASH FLOW
                                   FOR THE HALF -YEAR ENDED 31 DECEMBER 2011

                                                                           2011                  2010
                                                                            $                     $
                                                                                                           
Cash flows from operating activities

Payments to suppliers and employees                                        (1,547,655)           (1,138,870)
Income tax paid                                                               (10,739)                     -
Interest and other income received                                            392,185               142,007
                                                                                                            
Net cash flows used in operating activities                                (1,166,209)             (996,863)
                                                                                                           
Cash flows from investing activities                                                                       

Payment for purchase of equipment                                            (101,266)               (7,223)
Payment for exploration and evaluation expenditure                         (2,667,908)           (2,134,898)
                                                                                                            
Net cash flows used in investing activities                                (2,769,174)           (2,142,121)
                                                                                                           
Cash flows from financing activities                                                                       

Proceeds from issue of shares                                                       -               110,000
Transaction costs relating to issue of shares                                       -               (1,542)
                                                                                                           
Net cash flows from financing activities                                            -               108,458
                                                                                                           
Net decrease in cash and cash equivalents                                 (3,935,383)           (3,030,526)
Effects of exchange rate changes on cash and cash equivalents                     890               (4,247)
Cash and cash equivalents at beginning of the period                        8,716,949             4,091,528
                                                                                                           
Cash and cash equivalents at end of period                                  4,782,456             1,056,755
                                                       

This statement of cash flow should be read in conjunction with the accompanying notes.


                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                         NOTES TO THE FINANCIAL REPORT
                                   FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

1.    CORPORATE INFORMATION

      The  half-year  report  of Forte Energy NL and its controlled entities ("Consolidated  Entity")  for  the
      period  ended 31 December 2011 was authorised for issue in accordance with a resolution of the  directors
      on 14 March 2012.

      Forte  Energy  NL  is  a company limited by shares incorporated in Australia, whose shares  are  publicly
      traded  on  the  Australian Stock Exchange (ASX code "FTE"), and on the AIM Board  of  the  London  Stock
      Exchange.

      The  nature  of  operations and principal activities of the Consolidated Entity during the half-year  was
      the  exploration  for minerals. There have been no significant changes in the nature of these  activities
      during the half-year.

2.    BASIS OF PREPARATION AND ACCOUNTING POLICIES

(a)   Basis of Preparation

      This general purpose condensed consolidated financial report for the half-year ended 31 December  2011
      has  been  prepared  in accordance with AASB 134 "Interim Financial Reporting" and the  Corporations  Act
      2001.

      The  half-year  financial  report does not include all notes of the type  normally  included  within  the
      annual  financial  report  and therefore cannot be expected to provide as full an  understanding  of  the
      financial  performance,  financial position and financing and investing activities  of  the  Consolidated
      Entity as the full financial report.
      
      It  is  recommended  that the half-year financial report should be read in conjunction  with  the  annual
      financial  report  of Forte Energy NL for the year ended 30 June 2011 and considered  together  with  any
      public  announcements made by Forte Energy NL during the half-year ended 31 December 2011  in  accordance
      with the continuous disclosure obligations of the ASX Listing Rules.
      
      The half-year financial report has been prepared on a historical cost basis, except for available-for-
      sale investments, which have been measured at fair value.

      The financial report is presented in Australian dollars ($).

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

      Going Concern

      This  report  has been prepared on the going concern basis, which contemplates the continuity  of  normal
      business  activity and the realisation of assets and settlement of liabilities in the  normal  course  of
      business.
      
      The  Consolidated  Entity has incurred a net loss after tax for the half year ended 31 December  2011  of
      $1,289,810  (31 December 2010: $1,150,674) and has net current assets at 31 December 2011  of  $4,816,763
      (30  June  2011:  $8,554,258). The Consolidated Entity's cash flow forecast shows that  the  Consolidated
      Entity  will  require  further  funds to enable it to continue to meet  its  ongoing  administrative  and
      exploration expenditure for at least twelve months from the date of signing these financial statements.
      
                                                       

      The  Directors recognise that additional funding either through the issue of equity or the sale  of  non-
      core  assets  will  be required for the Consolidated Entity to continue to actively explore  its  mineral
      properties, and are currently pursuing options to obtain that funding. The Directors are satisfied  that,
      at  the date of the signing of the financial statements, there are reasonable grounds to believe that the
      Consolidated Entity will be able to raise sufficient funds to meet its obligations as and when they  fall
      due and continue to proceed with the Consolidated Entity's strategic objectives.
      
      Should the directors not achieve the matters set out above, there is significant uncertainty whether  the
      Consolidated  Entity will continue as a going concern and therefore whether it will  realise  its  assets
      and  extinguish its liabilities in the normal course of business and at amounts stated in  the  financial
      report.
      
      The   financial   statements  do  not  include  any  adjustments  relating  to  the  recoverability   and
      classification of recorded asset amounts, or to the amounts or classification of liabilities  that  might
      be necessary should the Consolidated Entity not be able to continue as a going concern.
      

 (b)  Significant accounting policies

      The accounting policies and methods of computation adopted in the preparation of the half-year financial
      report  are consistent with those adopted and disclosed in the Company's annual financial report for  the
      year  ended 30 June 2011. The Group has adopted all new and revised Standards and Interpretations  issued
      by  the  Australian  Accounting Standards Board (AASB) that are relevant to the consolidated  entity  and
      effective  for  annual  reporting periods beginning on or after 1 July 2011.  The  adoption  of  new  and
      revised  Standards  and Interpretations has not affected the amounts reported for the  current  or  prior
      half-year.

(c)   Basis of consolidation

      The  consolidated  financial statements comprise the financial statements of  Forte  Energy  NL  and  the
      entities  it  controlled  at the end of, or during, the half year ended 31 December  2011  ("Consolidated
      Entity").

      The  financial  statements of the subsidiaries are prepared for the same reporting period as  the  parent
      company, using consistent accounting policies.

      In  preparing  the consolidated financial statements, all intercompany balances and transactions,  income
      and expenses and profit and losses resulting from intra-group transactions have been eliminated in full.

      Subsidiaries  are  fully consolidated from the date on which control is transferred to  the  Consolidated
      Entity  and  cease  to  be  consolidated  from the date on  which  control  is  transferred  out  of  the
      Consolidated Entity.

                                                       
3.      SEGMENT INFORMATION

        Identification of reportable segments:
        
        For  management  purposes,  the Consolidated Entity is organised into two business  segments  based  on
        geographical exploration regions.
        
        Management  monitors the operating results of business segments separately for the  purpose  of  making
        decisions  about  resources  to  be  allocated and of assessing  performance.  Segment  performance  is
        evaluated  based  on exploration costs and results obtained. Finance costs, finance income  and  income
        taxes are managed on a group basis.
        
        The reportable segments of the Consolidated Entity are as follows:
        
               o       Uranium exploration in Mauritania.
               o       Uranium exploration in Guinea.

        Accounting policies and inter-segment transactions:

        The  accounting  policies  used by the Consolidated Entity in reporting segments  are  consistent  with
        those used to prepare the half-year financial report and are the same as those used in the prior year.
        
        It  is  the  Consolidated Entity's policy that if items of revenue and expenses are  not  allocated  to
        operating segments then any associated assets and liabilities are also not allocated to segments.  This
        is to avoid asymmetrical allocations within segments which management believe would be inconsistent.
        
        The  following items and associated assets and liabilities are not allocated to operating  segments  as
        they are not considered part of the core operations of any segment:
               o       Interest income and cash balances
               o       Net gains and losses on disposal of available-for-sale investments
               o       Non-current assets classified as held for sale, and
o       Corporate and administrative income and expenses other than the depreciation of fixed assets.

        
        Operating segments - 31 December 2011

                                                           Mauritania       Guinea uranium         Total
                                                             uranium         exploration              
                                                           exploration            $                   
                                                                $                                    $
         Half year ended 31 December 2011                                                             
                                                                                                      
         Revenues                                                                                     
         Other Revenue from external customers                         -                  -                   -
         Total Segment revenue                                         -                  -                   -
         Unallocated items                                                                                     
         Interest Income                                                                                190,888
         Other unallocated revenue                                                                       25,427
         Total revenue per statement of comprehensive                                                   216,315
         income
                                                                                                               
                                                       
         Results                                                                                               
         Segment results                                        (30,657)           (48,769)            (79,426)
         Unallocated items                                                                                     
         Unallocated revenue                                                                            216,315
         Unallocated expenses                                                                       (1,413,658)
         Net loss before tax                                                                        (1,276,769)
                                                                                                               
                                                                                                               
         Segment assets                                       18,259,587          7,082,449          25,342,036
         Cash and cash equivalents                                                                    4,782,456
         Non-current  assets classified  as  held  for                                                  144,231
         sale
         Other unallocated assets                                                                       935,667
         Total   assets  per  statement  of  financial                                               31,204,389
         position
                                                                                                               
         Segment liabilities                                   (497,566)           (31,336)           (528,902)
         Unallocated liabilities                                                                      (386,521)
         Total liabilities                                                                            (915,423)

        Operating segments - 31 December 2010

                                                                                                      
         Half year ended 31 December 2010                                                             
                                                                                                      
         Revenues                                                                                     
         Other Revenue from external customers                         -                  -                   -
         Total Segment revenue                                         -                  -                   -
         Unallocated items                                                                                     
         Interest Income                                                                                 60,115
         Other unallocated revenue                                                                       34,610
         Total revenue per statement of comprehensive                                                    94,725
         income
                                                                                                               
         Results                                                                                               
         Segment results                                         (9,805)           (13,812)            (23,617)
         Unallocated items                                                                                     
         Unallocated revenue                                                                             94,725
         Unallocated expenses                                                                       (1,211,673)
         Net loss before tax                                                                        (1,140,565)
                                                                                                               
                                                                                                               
         Segment assets as at 30 June 2011                    16,271,747          6,662,594          22,934,341
         Cash and cash equivalents                                                                    8,716,949
         Non-current  assets classified  as  held  for                                                  132,776
         sale
         Other unallocated assets                                                                       601,805
         Total   assets  per  statement  of  financial                                               32,385,871
         position as at 30 June 2011
                                                                                                               
         Segment liabilities as at 30 June 2011                (532,493)           (16,980)           (549,473)
         Unallocated liabilities                                                                      (289,768)
         Total liabilities as at 30 June 2011                                                         (839,241)
                                                       
                                                       
4       REVENUE
        
                                                                               2011                 2010
                                                                                $                    $
                                                                                                            
         Interest income                                                        190,888               60,115
         Office sub-lease rent                                                   24,996               34,610
         Other revenue                                                              431                    -
         Total other revenue                                                    216,315               94,725
                                                                                                             
                                                                                                             

5       ADMINISTRATIVE EXPENSES

                                                                                                            
Accounting and audit fees                                                        32,108               28,780
Consulting fees                                                                 119,470               45,240
Depreciation of plant and equipment                                              45,281               28,696
Employee benefits expense (i)                                                   523,394              482,515
Other employment expenses                                                        13,653                2,645
Foreign exchange differences                                                      (331)               25,524
Impairment loss on available for sale assets                                     11,260                    -
Legal fees                                                                       55,095               15,452
Media and public relations                                                       59,074               52,723
Nominated adviser and broker fees                                                69,832               51,483
Promotions, roadshows and conferences                                                 -               22,419
Reporting and listing costs                                                      54,268               55,294
Share based payments - contractors                                               40,158                    -
Telecommunication and computing                                                  36,930               66,079
Travel and accommodation                                                        182,763              145,404
Minimum lease payments - operating lease                                        125,561              142,593
Other                                                                            77,710               68,988
Total administrative expenses                                                 1,446,226            1,233,835
                                                                                               

(i)     Employee benefits expense is comprised of:

Salaries and wages                                                              389,196              336,532
Employee provisions                                                               (648)               23,447
Share based payments - employees and officers                                    30,555               36,257
Other staff costs                                                               104,291               86,279
Total                                                                           523,394              482,515
        

                                                       

6.      CASH AND CASH EQUIVALENTS


                                                                     31 December               30 June
                                                                         2011                    2011
                                                                             $                    $
                                                                                                           
Cash at bank and in hand                                                    1,781,972           3,216,949
Short term deposits                                                         3,000,484           5,500,000
                                                                            4,782,456           8,716,949

        Cash  at  bank earns interest at floating rates based on daily bank deposit rates. The carrying amounts
        of cash and cash equivalents represent fair value.

        Short term deposits are held with banks with maturities of three months.

7.      NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

        In  line  with  the  Consolidated  Entity's focus on progressing its  uranium  exploration  projects,  the
        Consolidated Entity has entered into a sale agreement to realise value for its non-uranium assets and  has
        therefore recognised these exploration assets as assets held for sale.

        The assets and liabilities associated with the non-uranium assets are as follows:

         Capitalised exploration and evaluation expenditure                   144,231    132,776                        
         Liabilities                                                            (154)      (484)                        
                                                                              144,077    132,292                        

8.      DIVIDENDS

        There were no dividends proposed or paid during the half-year ended 31 December 2011 (2010: nil).


9.      EXPLORATION AND EVALUATION EXPENDITURE

        Movements in carrying amounts

                                                                        31 December 2011           30 June
                                                                                   $                 2011
                                                                                                      $
                                                                                                               
         Carrying amount at 1 July                                            22,758,353            16,388,381
         Additions                                                             2,433,050             6,369,972
         Carrying amount at end of period net of impairment                   25,191,403            22,758,353


        Exploration  and  evaluation  costs have been capitalised at cost. No impairment  loss  was  recognised
        during the half-year ended 31 December 2011 (2010: nil ) because either:
           *   The exploration and evaluation activities are expected to be recouped through successful development
               and exploitation of the area of interest or, alternatively, by its sale; or
           *   Exploration and evaluation activities in each area of interest have not at the reporting date reached
               a stage that permits a reasonable assessment of the existence or otherwise of economically recoverable
               reserves, and active and significant operations in, or relevant to, the area of interest are continuing.


10.     COMMITMENTS AND CONTINGENCIES

        There  have been no material changes to the commitments and contingencies disclosed in the most  recent
        annual financial report.


11.   CONTRIBUTED EQUITY

                                                                    31 December 2011           30 June 2011
                                                                              $                     $
         Ordinary shares                                                                                     
         695,589,311 (30 June 2011: 695,589,311)                                                            
         ordinary shares, fully paid                                         81,264,725           81,264,725
                                                                                             
         2,250,000 (30 June 2010: 2,250,000) 25 cent                                                        
         value ordinary shares, partly paid to 1 cent                            22,500               22,500
                                                                             81,287,225           81,287,225

         (i)          Ordinary shares                                                                        
         
               Movement in ordinary shares on issue                         Number                  $
                                                                            580,658,031            67,464,067
                 At 1 July 2010
                 Shares issued from exercise of options                       2,000,000               110,000
        Transaction costs                                                             -               (1,543)
                                                                                                             
         Balance at 31 December 2010                                        582,658,031            67,572,524
                                                                                                     
                                                                            695,589,311            81,264,225
                 At 1 July 2011
                 Share issues                                                         -                     -
        Transaction costs                                                             -                     -
                                                                                                             
         Balance at 31 December 2011                                        695,589,311            81,264,225


                                                       

        
        (ii)    Options
        
                 Options over ordinary shares:
                 
                 During the financial period:
                     *       1,000,000 options expired with an exercise price of 6 pence,
                     *       1,000,000 options were granted with an exercise price of 6 pence with 500,000 vesting     
                             after 12 months and 500,000 vesting after two years,
                     *       2,000,000 options were granted with an exercise price of 10 pence vesting over three years 
                             subject to continuing employment and performance conditions,
                     *       5,000,000 options were granted with an exercise price of 12.5 cents vesting after 
                             achievement of performance milestones.


12.     EVENTS AFTER THE BALANCE SHEET DATE
   
        There have been no significant events that have occurred after Balance Sheet date.
        
        
        
                                                FORTE ENERGY NL
                                             (ABN 59 009 087 852)
                                                       
                                            DIRECTORS' DECLARATION
                                                       

In accordance with a resolution of the Directors of Forte Energy NL, I state that:

In the opinion of the Directors:

(a)     the financial statements and notes of the Consolidated Entity are in accordance with the Corporations
        Act 2001, including:

        (i)     giving a true and fair view of the financial position as at 31 December 2011 and the
                 performance for the half-year ended on that date of the Consolidated Entity; and
        
        (ii)    complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations
                 Regulations 2001; and

(b)     subject to the matters described in Note 2 Going Concern, there are reasonable grounds to believe that
        the Consolidated Entity will be able to pay its debts as and when they become due and payable.

On behalf of the Board






Mark D Reilly
Managing Director



London 14 March 2012






                                                                    Ernst & Young
                                                                    Ernst & Young Building
                                                                    121 King William Street
                                                                    Adelaide SA 5000 Australia
                                                                    GPO Box 1271 Adelaide SA 5001
                                                                    
                                                                    Tel: +61 8 8417 1600
                                                                    Fax: +61 8 8417 1775
                                                                    www.ey.com.au



Auditor's Independence Declaration to the Directors of Forte Energy NL

In relation to our review of the financial report of Forte Energy NL for the half-year ended 31 December 2011,
to the best of my knowledge and belief, there have been no contraventions of the auditor independence
requirements of the Corporations Act 2001 or any applicable code of professional conduct.



Ernst & Young



T S Hammond
Partner
Perth
14 March 2012








                                                                    Ernst & Young
                                                                    Ernst & Young Building
                                                                    121 King William Street
                                                                    Adelaide SA 5000 Australia
                                                                    GPO Box 1271 Adelaide SA 5001
                                                                    
                                                                    Tel: +61 8 8417 1600
                                                                    Fax: +61 8 8417 1775
                                                                    www.ey.com.au


To the members of Forte Energy NL

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of Forte Energy NL, which comprises the statement
of financial position as at 31 December 2011, the statement of comprehensive income, statement of changes in
equity and 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 Half-Year 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 half-year
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 31 December 2011 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
2001 . As the auditor of Forte Energy NL 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 2001. 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.

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 Forte Energy NL 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 31 December 2011 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
2001.

Material Uncertainty Regarding Continuation as a Going Concern

Without qualification to the conclusion expressed above, we draw attention to the following matter. As a result
of the matters described in Note 2 Going Concern to the financial report, there is significant uncertainty
whether the consolidated entity will continue as a going concern and therefore whether it will realise its
assets and extinguish its liabilities in the normal course of business and at the amounts stated in the
financial report. The financial report does not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that might be
necessary should the consolidated entity not continue as a going concern.



Ernst & Young



T S Hammond
Partner
Perth
14 March 2012


Contact Information

  • Forte Energy NL