QUARTERLY REPORT July – September 2009

Key Points

• Quarterly gold production increases by 78% to 23,389 oz
• Henty production guidance doubled to 50,000 oz in FY10
• Planned total production of 80-90,000 oz for FY10
• Strong cash balance of $52 million after Henty acquisition

Summary

Rod Hanson, Managing Director & CEO comment: “Record gold production was achieved in the September quarter with the first contribution from the Henty Gold Mine. We are extremely pleased with the Henty acquisition as it has doubled the size of the Company in terms of gold output and most importantly in future growth options. Operating cashflows from Henty are strong and we have already increased the mine life from six to 12 months, to June 2010, and I am confident that we will see extensions beyond that. “At Henty we are excited by the high quality mine and regional exploration targets which are available for testing. Exploration is showing immediate rewards with delineation of an up-dip continuation of the Tyndall Zone. Success was also achieved at the Kangaroo Flat Mine with the discovery of significant extensions to the small but high grade Dumble reef. “The Company’s first major acquisition has been professionally integrated and I believe we have capacity for further growth at both our mines, whilst being alert for additional acquisition opportunities.” said Mr Hanson.

Production

• Gold production of 23,389 oz at a cash operating cost of A$658/oz (13,122 oz gold June 09 qtr). Production and operating costs were to plan.
• Kangaroo Flat delivered 9634 oz at a cost of A$671/oz whilst the first contribution from the Henty Gold Mine was 13,755 oz at $649/oz
• Production guidance at the Henty Mine doubled from 25,000 oz to 50,000 oz for FY10. Mine life was increased from Dec 09 to June 10, with resources to support further extensions. The Tyndall Zone was accessed late in the quarter with high grade ore faces intersected (up to 11.2 g/t gold).

Exploration

Exploration has recommenced at Henty with the first drill results indicating a high grade extension of the Tyndall Zone (including 2.9 m at 13.8 g/t gold). • The small tonnage but high grade Dumble reef was significantly extended this quarter at the Kangaroo Flat Mine. • A broader exploration program is being developed at Henty to test for extensions and repetitions of the Henty system.

Corporate

• Gold sales receipts were $22.8 million during the quarter from the sale of 19,816 oz gold at an average price of A$1151/oz.
• Cash in bank remains high at $52.2 million at 30 September 2009 (at 30 June 2009 was $57.0 million) after payments for Henty acquisition of $5 million, a $2.5 million dividend payment and increased working capital.
• On 26 August 2009, the Company announced a profit of $8.25 million for the 2009 financi