Forte Energy NL
LSE : FTE

March 15, 2013 03:28 ET

Half Yearly Report




                                                                                                               
                                                       
                                                       
                                               FORTE  ENERGY  NL
                                                       
                                                       
                                              ABN 59 009 087 852
                                                       
                                                       
                                                       
                                                       
                                                       
                                                       
                                          HALF-YEAR FINANCIAL REPORT
                                                       
                                                       
                                               31 DECEMBER 2012
                                                       
                                                       
                                                       
                                                       
                                                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 Flows                                                             8

        Notes to the Half-Year Financial Report                                                          9

        Directors' Declaration                                                                          19

        Auditor's Independence Declaration                                                              20

        Independent Review Report                                                                       21





                                                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 2012 ("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
Mark David Reilly - Managing Director
Christopher David Grannell - Non-executive Director
James Gerald Leahy - Non-executive Director

Review and Results of Operations

The Consolidated Entity reported a loss for the half-year of $1,475,965 (2011: $1,289,810).

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

    *   During September 2012, SEMS Exploration Ltd completed over 470 line km of combined high resolution
        ground  magnetic and radiometric survey over the A238 prospect in Mauritania. The survey confirmed  the
        structural control of the A238 prospect in the Zednes shear zone; extension of the main shear zone to the south
        for over 3.5km, below the quaternary cover; and that the structure continues to the north for over 2km, near to
        surface and outcropping.

    *   As  part of the preliminary economic assessment (PEA) study, an environmental base line and social
        impact assessment was completed on the 286 Legleya licence in Mauritania.

    *   At the end of year the A238 Prospect has a JORC inferred resource of 45.2Mt @ 235ppm U3O8 for 23.4Mlbs
        contained U3O8 (100ppm U3O8cut-off) and remains open at depth.

    *   In December 2012 a Reverse Circulation (RC) drilling programme was completed at the A238 prospect in
        Mauritania. 28 holes were drilled, totalling 4,115m. Assay results from the drilling programme released on 12
        March 2013 confirmed intermittent narrow mineralisation over a strike length of 0.5km to the north of the
        existing A238 Resource.



                                                       
Uranium Exploration - Guinea

    *   Following the 2011/12 field season, a revised JORC resource was announced for Firawa on
        6 July 2012 of 30.3Mt @ 295ppm U3O8 for 19.5Mlbs of contained U3O8 (100ppm cut-off), an increase of 68%.

    *   Encouraging assay results from RC drilling at the Company's other Guinea project, Bohoduo, were also
        released in July 2012, confirming near-to-surface uranium mineralisation over a strike length of 2.3km, with
        best intersections including 24m @ 506ppm U3O8.
        
    *   Following an audit conducted by KPMG initiated by the Guinean government in 2012, Forte Energy were
        notified that its licences in Guinea are fully compliant with the Exploration legislation. Applications for
        licence extensions were submitted in July 2012, and are now being reviewed following the audit results.

Corporate

    *   After receiving shareholder approval at a meeting held on 2 August 2012, the Company completed the
        second tranche of the placement announced in June 2012 with the issue of 78,980,000 shares. The shares were
        issued at 1.25 pence per share, raising A$1.4m before costs. 86,702,500 attaching unlisted options exercisable
        at 3 pence per share on or before 3 August 2012 were also granted after obtaining shareholder approval.

Events subsequent to balance date

On  15  February  2013  the  Company announced that it had entered into a GBP 10 million  discretionary  equity
financing  facility with Darwin Strategic Limited, a majority owned subsidiary of Henderson  Global  Investors'
Volantis  Capital. The facility (subject to certain restrictions) can be drawn down at any time over  the  next
three  years.  Under  the terms of the agreement, the Company granted 5,000,000 warrants  to  Darwin  Strategic
Limited on 27 February 2013. The warrants are exercisable at 3 pence per share on or before 14 February 2015.

An initial draw down was announced on 28 February 2013 with the issue of 29,250,000 shares completed on 6 March
2013 to raise GBP 587,177 ($869,961) before costs.

Apart  from other events 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 (2011:  $ 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 20 and forms part of this report.

Signed in accordance with a resolution of the directors.






Mark Reilly
Managing Director

London 15 March 2013



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  former
Technical  Director of Forte Energy NL. He has an ongoing role as a consultant to the Company.  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 Resources at the A238 prospect in Mauritania and  at
Firawa in Guinea is based on information compiled by Mr. Bosse Gustafsson of Forte Energy NL and Mr Galen White
BSc (Hons) FGS, FAUSIMM, Managing Director and Principal Geologist of CSA Global (UK) ltd.

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.  Neil
Inwood  is  the  Competent Person responsible for the resource estimation and classification. Mr  Inwood  is  a
Fellow of the AusIMM. As Mr Inwood is now no longer employed by Coffey Mining, Coffey Mining has reviewed  this
information  release  and  consent to the inclusion, form and context of the  relevant  information  herein  as
derived from the original resource reports for which Mr Inwood's consent has previously been given.

Mr.  Gustafsson,  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. White and Coffey Mining on behalf
of Mr. Inwood 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 2012
                                                       
                                                       
                                                            Notes          2012                  2011
                                                                            $                     $
                                                                                                          
                                                                                                          
 Revenue                                                       4             101,460               216,315
 Other income                                                  5              51,340                     -
 Exploration expenses                                                       (23,759)              (46,858)
 Administrative expenses                                       6         (1,585,997)           (1,446,226)
                                                                                                          
 Loss before income tax                                                  (1,456,956)           (1,276,769)
 Income tax expense                                                         (19,009)              (13,041)
                                                                                                          
 Loss after income tax                                                   (1,475,965)           (1,289,810)
                                                                                                          
                                                                                                          
 Net loss for the period                                                 (1,475,965)           (1,289,810)
                                                                                                          
 Other comprehensive income
 Items that may be reclassified subsequently to profit                                                    
 and loss:
 Gain/(loss) on available-for-sale financial assets, net                           -               (9,303)
 of tax
 Impairment loss transferred to loss for the period                                -                11,260
 Foreign currency translation                                                 29,648              (40,524)
 Other comprehensive income for the period net of tax                         29,648              (38,567)
                                                                         (1,446,317)           (1,328,377)
 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                                                       (0.17)                (0.19)
 - diluted loss per share                                                     (0.17)                (0.19)
                                                                                                          


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 2012
                                                       


                                                    Notes      31 December 2012            30 June 2012
                                                                       $                        $
 ASSETS                                                                                                  
 Current Assets                                                                                          
 Cash and cash equivalents                            7                   486,566               1,763,431
 Trade and other receivables                                              342,052                 528,667
 Prepayments                                                               75,099                  90,885
                                                                          903,717               2,382,983
 Non-current assets classified as held for sale       8                   166,835                 151,661
 Total Current Assets                                                   1,070,552               2,534,644
                                                                                                         
 Non-current assets                                                                                      
 Available-for-sale financial assets                                        1,660                   1,725
 Exploration and evaluation expenditure               10               30,425,897              28,463,555
 Plant and equipment                                                      206,696                 240,058
 Total Non-Current Assets                                              30,634,253              28,705,338
                                                                                                         
 TOTAL ASSETS                                                          31,704,805              31,239,982
                                                                                                         
 LIABILITIES                                                                                             
 Current Liabilities                                                                                     
 Trade and other payables                                                 811,833                 382,384
 Income tax payable                                                        47,136                   6,166
 Provisions                                                                68,050                  99,817
 Derivative financial instruments                     13                   76,320                       -
                                                                        1,003,339                 488,367
 Liabilities associated with assets held for sale     8                     2,727                   2,847
 Total Current Liabilities                                              1,006,066                 491,214
                                                                                                         
 TOTAL LIABILITIES                                                      1,006,066                 491,214
                                                                                                         
 NET ASSETS                                                            30,698,739              30,748,768
                                                                                                         
 EQUITY                                                                                                  
 Contributed equity                                   12               84,336,230              83,076,849
 Reserves                                                               2,552,693               2,386,138
 Accumulated losses                                                  (56,190,184)            (54,714,219)
                                                                                                         
 TOTAL EQUITY                                                          30,698,739              30,748,768
                                                       
                                                       
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 2012
                                                       
                
                            Contributed    Accumulated    AFS financial     Equity        Foreign        Total
                               equity        losses          assets        benefits      currency       equity
                                                             reserve        reserve     translation        
                                 $              $               $              $             $             $
                                                                                                           
 At 1 July 2012               83,076,849   (54,714,219)                -    2,456,399      (70,261)     30,748,768
                                       -    (1,475,965)                -            -             -    (1,475,965)
 (Loss) for the period
 Other comprehensive                   -              -                -            -        29,648         29,648
 income
 Total comprehensive                   -    (1,475,965)                -            -        29,648    (1,446,317)
 income for the half year
 net of tax
                                                                                                                  
 Equity transactions:
 Share based payment                   -              -                -      136,907             -        136,907
 Issue of ordinary shares      1,350,668              -                -            -             -      1,350,668
 Transaction costs              (91,287)                                                                  (91,287)
 Balance At                   84,336,230   (56,190,184)                -    2,593,306      (40,613)     30,698,739
 31 December 2012
                                                                                                           
 
 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
                                                       

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 2012

                                                                           2012                  2011
                                                                            $                     $
                                                                                                           
Cash flows from operating activities

Payments to suppliers and employees                                        (1,252,892)           (1,547,655)
Income tax paid                                                                      -              (10,739)
Interest and other income received                                            111,234               392,185
                                                                                                            
Net cash flows used in operating activities                                (1,141,658)           (1,166,209)
                                                                                                           
Cash flows from investing activities                                                                       

Payment for purchase of equipment                                             (15,550)             (101,266)
Payment for exploration and evaluation expenditure                         (1,506,258)           (2,667,908)
                                                                                                            
Net cash flows used in investing activities                                (1,521,808)           (2,769,174)
                                                                                                           
Cash flows from financing activities                                                                       

Proceeds from issue of shares                                               1,478,328                     -
Transaction costs relating to issue of shares                                (91,287)                     -
                                                                                                           
Net cash flows from financing activities                                    1,387,041                     -
                                                                                                           
Net decrease in cash and cash equivalents                                 (1,276,425)           (3,935,383)
Effects of exchange rate changes on cash and cash equivalents                   (440)                   890
Cash and cash equivalents at beginning of the period                        1,763,431             8,716,949
                                                                                                           
Cash and cash equivalents at end of period                                    486,566             4,782,456
                                                       

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 2012

1.    CORPORATE INFORMATION

      The  half-year  report  of Forte Energy NL and its controlled entities ("Consolidated  Entity")  for  the
      period  ended 31 December 2012 was authorised for issue in accordance with a resolution of the  directors
      on 15 March 2013.

      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  2012
      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 and derivative financial instruments 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  2012  of
      $1,475,965  (31 December 2011: $1,289,810) and has net current assets at 31 December 2012 of $64,486  (30
      June  2012: $2,043,430). 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.
    
      On  15  February  2013,  the  Company announced that it had entered into a GBP 10  million  discretionary
      equity  financing  facility over three years to secure access to additional funding as required.  Further
      details are provided in Note 14.
      
      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  Group  not achieve the matters set out above, there is uncertainty whether  the  Group  will
      continue  as  a  going  concern  and therefore whether it will realise  its  assets  and  extinguish  its
      liabilities in the normal course of business 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 Group 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 2012. As set out in Note 2(d) below, the Group has adopted a new policy with  respect
      to  derivative  financial  instruments.  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  2012.   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  2012  ("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.

                                                       

 (d)  Derivative Financial Instruments

      Initial recognition and measurement

      Derivative  financial  instruments  are initially stated at their fair  value  on  the  date  a  derivate
      contract  is executed and are subsequently carried at fair value at each report date. The resulting  gain
      or loss is recognised in the statement of comprehensive income during each reporting period.

      The  fair  value  of derivative financial instruments not traded in an active market is determined  using
      valuation techniques based on option pricing models.
      An  analysis of fair values of financial instruments and further details as to how they are measured  are
      provided in Note 13.

                                                       

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 2012

                                                           Mauritania       Guinea uranium         Total
                                                             uranium         exploration              
                                                           exploration            $                   
                                                                $                                    $
         Half year ended 31 December 2012                                                             
                                                                                                      
         Revenues                                                                                     
         Other Revenue from external customers                         -                  -                   -
         Total Segment revenue                                         -                  -                   -
         Unallocated items                                                                                     
         Interest Income                                                                                  4,772
         Other unallocated revenue                                                                       96,689
         Total revenue per statement of comprehensive                                                   101,460
         income
         Other unallocated income                                                                        51,340
                                                       

                                                         Mauritania      Guinea uranium           Total
                                                          uranium         exploration               
                                                        exploration            $                    
                                                             $                                      $
         Results                                                                                               
         Segment results                                      (17,856)          (35,651)               (53,507)
         Unallocated items                                                                                     
         Unallocated revenue                                                                            101,460
         Other unallocated income                                                                        51,340
         Unallocated expenses                                                                       (1,556,249)
         Net loss before tax                                                                        (1,456,956)
                                                                                                               
         Segment assets                                     22,261,254         8,265,508             30,526,762
         Unallocated items                                                                                     
         Cash and cash equivalents                                                                      486,566
         Non-current assets classified as  held  for                                                    166,835
         sale
         Other Corporate assets                                                                         524,642
         Total  assets  per statement  of  financial                                                 31,704,805
         position
                                                                                                               
         Segment liabilities                                 (579,490)          (13,950)              (593,440)
         Unallocated liabilities                                                                      (412,626)
         Total liabilities                                                                          (1,006,066)

        Operating segments - 31 December 2011
                                                                                                      
         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 as at 30 June 2012                    20,519,783          8,062,273          28,582,056
         Unallocated items                                                                                     
         Cash and cash equivalents                                                                    1,763,431
         Non-current  assets classified  as  held  for                                                  151,661
         sale
         Other Corporate assets                                                                         742,834
         Total   assets  per  statement  of  financial                                               31,239,982
         position as at 30 June 2012
                                                                                                               
         Segment liabilities as at 30 June 2012                 (84,372)           (41,370)           (125,742)
         Unallocated liabilities                                                                      (365,472)
         Total liabilities as at 30 June 2012                                                         (491,214)
                                                       

4       REVENUE
        
                                                                               2012                 2011
                                                                                $                    $
                                                                                                            
         Interest income                                                          4,772              190,888
         Office sub-lease rent                                                   96,689               24,996
                                                                                                            
         Other revenue                                                                -                  431
         Total other revenue                                                    101,460              216,315
                                                                                                             
                                                                                                             
5       OTHER INCOME

                                                                                                            
Gain on derivative financial instruments                                         51,340                    -
Total other income                                                               51,340                    -

6       ADMINISTRATIVE EXPENSES

                                                                                                            
Accounting and audit fees                                                       113,076               32,108
Consulting fees                                                                  25,545              119,470
Depreciation of plant and equipment                                              48,912               45,281
Employee benefits expense (i)                                                   472,194              523,394
Other employment expenses                                                        10,812               13,653
Foreign exchange differences                                                     11,440                (331)
Impairment loss on available for sale assets                                         65               11,260
Legal fees                                                                       38,819               55,095
Media and public relations                                                      100,394               59,074
Nominated adviser and broker fees                                                47,500               69,832
Promotions, roadshows and conferences                                             3,797                    -
Reporting and listing costs                                                      57,991               54,268
Share based payments - other                                                    127,660               40,158
Telecommunication and computing                                                  40,745               36,930
Travel and accommodation                                                        109,314              182,763
Minimum lease payments - operating lease                                        288,150              125,561
Other                                                                            89,583               77,710
Total administrative expenses                                                 1,585,997            1,446,226
                                                                                               

(i)     Employee benefits expense is comprised of:

Salaries and wages                                                              369,680              389,196
Employee provisions                                                            (31,767)                (648)
Share based payments - employees and officers                                     9,247               30,555
Other staff costs                                                               125,034              104,291
Total                                                                           472,194              523,394

                                                       

7.      CASH AND CASH EQUIVALENTS


                                                                     31 December               30 June
                                                                         2012                    2012
                                                                             $                    $
                                                                                                           
Cash at bank and on hand                                                      486,566           1,663,431
Short term deposits                                                                 -             100,000
                                                                              486,566           1,763,431

        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.

8.      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                      166,835             151,661
         Liabilities                                                             (2,727)             (2,847)
                                                                                 164,108             148,814

9.      DIVIDENDS

        There were no dividends proposed or paid during the half-year ended 31 December 2012 (2011: nil).


10.     EXPLORATION AND EVALUATION EXPENDITURE

        Movements in carrying amounts

                                                                        31 December 2012           30 June
                                                                                   $                 2012
                                                                                                      $
                                                                                                               
         Carrying amount at 1 July                                            28,463,555            22,758,353
         Additions                                                             1,962,342             5,705,202
         Carrying amount at end of period net of impairment                   30,425,897            28,463,555


        
        Exploration  and  evaluation  costs have been capitalised at cost. No impairment  loss  was  recognised
        during the half-year ended 31 December 2012 (2011: 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.


11.     COMMITMENTS AND CONTINGENCIES

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


12.   CONTRIBUTED EQUITY

                                                                    31 December 2012           30 June 2012
                                                                              $                     $
         Ordinary shares                                                                                     
         872,894,311 (30 June 2012: 793,914,311)                                                            
         ordinary shares, fully paid                                         84,313,730           83,054,349
                                                                                             
         2,250,000 (30 June 2012: 2,250,000) 25 cent                                                        
         value ordinary shares, partly paid to 1 cent                            22,500               22,500
                                                                             84,336,230           83,076,849

         (i)          Ordinary shares                                                                        
         
               Movement in ordinary shares on issue                         Number                  $
                                                                            697,839,311            81,287,225
                 At 1 July 2011
                 Shares issues                                                        -                     -
                 Transaction costs                                                    -                     -
                                                                                                             
                 Balance at 31 December 2011                                697,839,311            81,287,225
                                                                                                     
                                                                            796,164,311            83,076,849
                 At 1 July 2012
                 Share issues                                                78,980,000             1,350,668
                 Transaction costs                                                    -              (91,287)
                                                                                                             
                 Balance at 31 December 2012                                875,144,311            84,336,230

                                                       
        
        (ii)    Options
        
                 Options over ordinary shares:
                 
                 During the financial period:
                     *       88,652,500 options were granted with an exercise price of 3 pence,
                     *       3,000,000 options expired with an exercise price of 10 cents,
                     *       5,000,000 options expired with an exercise price of 11 cents and
                     *       6,000,000 options expired with an exercise price of 20 cents.

13.     DERIVATIVE FINANCIAL INSTRUMENTS

        The  Company  has  entered into the following derivative contract that has not  been  designated  as  a
        hedge:
                                                                    31 December 2012           30 June 2012
                                                                              $                     $
                                                                                                             
         Warrant derivatives at fair value - issued 3 August 2012             76,320                    -
                                                                              76,320                    -

        88,652,500  unlisted warrants expiring on 2 August 2013 were issued on 3 August 2012  to  institutional
        investors  who participated in the Company's placements in June and August 2012. Participants  received
        one  free-attaching warrant for every 2 shares. The warrants are exercisable at GBP 3  pence  each  and
        entitle  the holder to one fully paid ordinary share in the Company once exercised. The fair  value  at
        inception was $127,660.
        
        The  resulting  $76,320 (30 June 2012: nil) fair market value of these options has been  recognised  on
        the statement of financial position as derivative financial instruments.
        
        The  change in the fair value of these derivatives of $51,340 (2011: nil) has been recognised in profit
        or loss during the reporting period under other income as gain on derivative financial instruments.

        Unlisted warrants granted and option pricing model inputs:
        The Binomial model inputs for unlisted warrants issued on 3 August 2012 included:
        (a)  88,625,000  warrants  were granted for no consideration. Entitlements to  the  warrants  vested  at
             grant date
        (b)  Exercise price of options: 3 pence.
        (c)  Time to maturity: 1 year
        (d)  Underlying security spot price at date of options grant: $0.02
        (e)  Risk of underlying share/Annualised standard deviation:  80%
        (f)  Expected Dividend yield: Nil
        (g)  Expected life: 1 years
        (h)  Risk-free interest rate: 0.21%.


14.     EVENTS AFTER THE BALANCE SHEET DATE
   
        On  15  February  2013  the Company announced that it had entered into a GBP 10  million  discretionary
        equity  financing  facility  with Darwin Strategic Limited, a majority owned  subsidiary  of  Henderson
        Global  Investors' Volantis Capital. The facility (subject to certain restrictions) can be  drawn  down
        at  any time over the next three years. Under the terms of the agreement, the Company granted 5,000,000
        warrants  to Darwin Strategic Limited on 27 February 2013. The warrants are exercisable at 3 pence  per
        share on or before 14 February 2015.
        
        An  initial draw down was announced on 28 February 2013 with the issue of 29,250,000 shares on 6  March
        2013 to raise GBP 587,177 ($869,961) before costs.
        
        
        
                                                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 2012 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 15 March 2013



                                                                    Ernst & Young
                                                                    Ernst & Young Building
                                                                    11 Mounts Bay Road
                                                                    Perth WA 6000 Australia
                                                                    GPO Box M939 Perth WA 6843
                                                                    
                                                                    Tel: +61 8 9429 2222
                                                                    Fax: +61 8 9429 2436
                                                                    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 2012,
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



D S Lewson
Partner
15 March 2013








                                                                    Ernst & Young
                                                                    Ernst & Young Building
                                                                    11 Mounts Bay Road
                                                                    Perth WA 6000 Australia
                                                                    GPO Box M939 Perth WA 6843
                                                                    
                                                                    Tel: +61 8 9429 2222
                                                                    Fax: +61 8 9429 2436
                                                                    www.ey.com.au
                                                                    

Independent review report 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
consolidated statement of financial position as at 31 December 2012, the consolidated income statement, the
consolidated statement of comprehensive income, the consolidated statement of changes in equity and the
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 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 2012 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 2012 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.

Emphasis of Matter

Without qualification to the statement expressed above, attention is drawn to the following. As a result of the
matters described in Note 2 "Going Concern" of the financial report, there is material uncertainty whether the
consolidated entity will be able to continue as a going concern and therefore whether it will be able to pay
its debts as and when they fall due and realise its assets and extinguish its liabilities in the normal course
of business 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 be able to continue as
a going concern.



Ernst & Young



D S Lewson
Partner
15 March 2013



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  • Forte Energy NL