Interim Financial Report

27 February 2015

Wolf Minerals Limited

Interim Financial Report

For the half year ended 31 December 2014

Specialty metals development company, Wolf Minerals Limited (ASX: WLF, AIM: WLFE) ("Wolf" or "the Company") is pleased to release its interim financial report for the half year ended 31 December 2014.

Highlights for the half year include:

· On track to deliver the first new metal mine in Great Britain for over 45 years.

· The progress of the Hemerdon Project (the "Project") as at the half year was 67% complete and also on schedule and within budget. The EPC contractor expects to commence dry commissioning of the plant in March 2015.

o The EPC Contractor hand over to Wolf Minerals is scheduled for Q3 2015.

o At the half year all structural concrete pours were complete with structural steel erection being 44% complete. As the date of this release the structural steel erection is now 80% complete.

· The Mine Waste Facility is on track to be finished by the scheduled plant commissioning.

o During construction of the Mine Waste Facility 100,000 tonnes of ore has been extracted and stockpiled, forming the basis of the initial feed to the processing plant.

· A geotechnical diamond drilling programme to assess the feasibility of extending the mine life through steepening the mine walls and thereby enabling a deeper pit has concluded. With the potential to increase ore reserves by between 15% to 23% this possible extension would occur within the existing planning permission boundary.

· Commencement of the draw down of £75m million in senior debt facilities following Wolf Minerals satisfying all necessary conditions. As at the date of this release 50% of the debt facilities have been drawn.

· The Assay Laboratory contract for the Project was finalised and awarded to SGS. The Power Supply contract for the Project to DONG Energy was awarded in early January 2015.

· Recruitment of key personnel is on track.

Commenting on the interim results, Wolf Managing Director, Russell Clark said:

"I am delighted to be able to report on the significant progress we made in the first half of the current financial year and which has continued into the second half. The Hemerdon Project is progressing well and is on schedule for dry commissioning in March 2015 with 100% of the equipment having been delivered and 80% of the structural steel erection complete since the period end. Additionally, we have completed the drilling programme undertaken to assess the opportunity, within the existing planning permission boundary, to steepen the mine walls and thereby increase the reserves and extend the mine life. The Company will report on the results of the drilling programme in due course. Based on the progress we have made so far the Board remains confident of delivering a tungsten producing mine on schedule and on budget."

ENDS

The Company's web site has time lapse photography showing both the processing plant site and mine site which can be seen at:

http://www.wolfminerals.com.au/hemerdon-tungsten-and-tin-project/live-stream 

WOLF MINERALS LIMITED

A.B.N. 11 121 831 472

AND CONTROLLED ENTITIES

INTERIM FINANCIAL REPORT

31 DECEMBER 2014

31 DECEMBER 2014

CONTENTS

CORPORATE DIRECTORY 1

DIRECTORS' REPORT 2

AUDITORS INDEPENDENCE DECLARATION 6

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 7

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION 8

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 9

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS 10

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 11

DIRECTORS' DECLARATION 24

INDEPENDENT AUDITORS' REVIEW REPORT 25

This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2014 and any public announcements made by Wolf Minerals Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

CORPORATE DIRECTORY

NON-EXECUTIVE CHAIRMAN

John Hopkins OAM

EXECUTIVE MANAGING DIRECTOR

Russell Clark

NON-EXECUTIVE DIRECTORS

Ronnie Beevor

Nick Clarke

Chris Corbett

Don Newport

Michael Wolley

ALTERNATE DIRECTOR

William Goodwin

CHIEF FINANCIAL OFFICER

Richard Lucas

JOINT COMPANY SECRETARIES

Richard Lucas

Pauline Carr

PRINCIPAL & REGISTERED OFFICE

Level 3, 22 Railway Road

SUBIACO WA 6008

AUDITORS

PKF Mack

Level 4, 35 Havelock Street

WEST PERTH WA 6005

LAWYERS

Steinepreis Paganin

Level 4, 16 Milligan Street

PERTH WA 6000

SHARE REGISTER

Security Transfer Registrars Pty Ltd

770 Canning Hwy

APPLECROSS WA 6153

UK DEPOSITORY

Computershare Investor Services PLC

The Pavilions, Bridgwater Road

Bristol BS99 6ZZ

SECURITIES EXCHANGE LISTINGS

Australian Securities Exchange

(Home Exchange: Perth, Western Australia)

Code: WLF

Alternative Investment Market

London Stock Exchange

Code: WLFE

BANKERS

National Australia Bank

50 St Georges Terrace

PERTH WA 6000

WEBSITE

www.wolfminerals.com

DIRECTORS' REPORT

Your Directors submit the financial report of the Consolidated Entity for the half year ended

31 December 2014.

DIRECTORS

The names of Directors who held office during or since the end of the half year:

PRINCIPAL ACTIVITIES

During the half year the principal activities of the Consolidated Entity consisted of mineral development, conducted through Wolf Minerals (UK) Limited.

REVIEW OF RESULTS

The Directors of Wolf Minerals Limited ("Wolf" or "the Company") announce for the half year to 31 December 2014 a net consolidated loss after tax of $3,719,177 (2013: $1,322,933).

REVIEW OF OPERATIONS

Summary

Wolf has continued to focus on its development of the Hemerdon tungsten and tin project ("Hemerdon" or "the Project") located in Devon, England. During the half year ended 31 December 2014 the key activities include:

· Continued progress on the development of the Project.

· Commenced draw down of £75 million in senior debt facilities.

· Geotechnical diamond drilling program completed.

· Laboratory Services contract awarded for the Project.

· Appointment of new officers of the Company.

Continued progress on the development of the Project

The construction of the Project commenced in February 2014.

As at 31 December 2014 construction was 67% complete and remains on schedule. GR Engineering Services Limited, the Project's Engineering-Procurement-Construction ("EPC") contractor, expects to commence dry commissioning of the plant in March 2015, with the hand over to Wolf scheduled for the third quarter of 2015.

By the end of the December 2014, significant progress had been made at the site including:

DIRECTORS' REPORT (CONTINUED)

· Continued progress on the Mine Waste Facility. This facility accommodates the waste from both the mine and the processing plant and is one of the key components of the Project. As expected, construction of the facility has slowed during the winter months and is still on track to be available for the scheduled plant commissioning.

· All structural concrete pours are now complete.

· Structural steel erection was 44% complete.

· All plant equipment has been delivered to site or is in transit to site, allowing for immediate installation as the foundations or supporting steelwork becomes available.

· Administration, laboratory and amenities buildings have been completed and will be commissioned in early 2015.

· Development of the open pit continued with the excavation waste used in the construction of the Mine Waste Facility. There is no overburden removal required to access the orebody, as it is exposed at surface from previous operations.

· Over 100,000 tonnes of ore have been stockpiled at the mine. This ore was extracted during the mining of waste used for the construction of the Mine Waste Facility and will form the basis of the initial feed to the processing plant.

· Recruitment of key professional staff continued with Wolf having 37 employees working directly for Wolf Minerals (UK) Limited at 31 December 2014 with a number of new recruits to start in January 2015.

· At the end of December there were over 350 people working at the Project site.

· Tree planting and stone wall reconstruction activities had commenced, with 40,000 trees to be planted by June 2015.

Commenced draw down of £75 million in senior debt facilities

During the period Wolf reported that it had satisfied all necessary conditions required to draw down the Project's £75 million senior debt finance facilities (refer to Announcement dated 16 September 2014). This represented another significant milestone for the Project and the Company.

The first draw down and utilisation of the funds took place on 19 September 2014.

As at 31 December 2014 Wolf had drawn down £27,500,000 (~A$52,398,500) of the senior term loan and had utilised the full £5,000,000 (~A$9,527,000) of the available bond facility.

Geotechnical diamond drilling program completed

Wolf has undertaken a geotechnical diamond drill program around the perimeter of the open pit, designed to provide more comprehensive data on the waste rock. The aim of the program is to assess the potential to steepen the pit walls within the existing Planning Permission which will allow for a deeper pit and an increase in ore reserves.

DIRECTORS' REPORT (CONTINUED)

The six hole geotechnical drilling program was completed during the December 2014 quarter, with initial analysis suggesting potential to increase ore reserves by between 15% to 23% within the existing planning permission (refer to announcement dated 1 December 2014). Detailed design and re-assessment of ore reserves will be undertaken during the March 2015 quarter.

Laboratory Services contract awarded for the Project

Wolf finalised and awarded the Assay Laboratory contract for the Project to SGS (refer to announcement dated 22 December 2014).

Under the terms of the contract SGS will provide all the necessary assay laboratory services at the Project for a five year period. Services will include the assay of grade control samples, process plant samples and final product samples. SGS will also provide verification and certification of the products being sent to customers.

SGS is the world's leading inspection, verification, testing and certification company and has more than 80,000 employees and more than 1,650 offices and laboratories around the world.

The forecast assaying costs are in line with estimates contained in the Definitive Feasibility Study of May 2011, and will contribute to Wolf being a low cost tungsten producer.

Appointment of new officers of the Company

On 3 November 2014, Wolf appointed Ms Pauline Carr as Joint Company Secretary. Ms Carr will join Mr Richard Lucas, Chief Financial Officer and current Company Secretary, in providing support to the Board as Mr Lucas takes on increasing responsibilities with the development of the Project.

Ms Carr is a fellow of the Governance Institute of Australia and a fellow of the Australian Institute of Company Directors and has over 20 years company secretarial and governance experience with Australian and internationally listed companies in the resources sector.

On 24 December 2014, the Company also welcomed Mr Will Goodwin who was appointed to act as an Alternate Director for Mr Michael Wolley, a non-executive Director, at any meeting of Directors which he is not able to attend. The appointment of Mr Goodwin will continue until Mr Goodwin either resigns, Mr Wolley revokes the appointment or until Mr Wolley ceases to be a Director, whichever occurs first.

Mr Wolley is Vice President of Todd Minerals and Coal, a major shareholder in the Company.

Mr Goodwin has more than 10 years' experience in private equity, mining, corporate strategy and business development. He is currently employed as Chief Financial Officer for Todd Minerals and Coal, having previously held senior roles in The Todd Corporation and Todd Capital.

He has experience across a broad range of sectors including infrastructure, telecommunications, mining, downstream energy, healthcare, agriculture, fast moving consumer goods and financial services. Mr Goodwin is an affiliate of the Australian Institute of Company Directors and a graduate of the Victoria University of Wellington with a Bachelor of Commerce (economics) and a Masters of Applied Finance.

AUDITOR'S DECLARATION

The lead auditor's independence declaration under section 307C of the Corporations Act 2001 is set out on page 6 for the half year ended 31 December 2014.

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

_____________________________

Russell Clark

Managing Director

Dated: 26 February 2015

AUDITOR'S INDEPENDENCE DECLARATION

TO THE DIRECTORS OF WOLF MINERALS LIMITED

In relation to our review of the financial report of Wolf Minerals Limited for the half year ended 31 December 2014, 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.

PKF Mack

Simon Fermanis

Partner

26 February 2015

West Perth,

Western Australia

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

The above condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2014

The above condensed consolidated statement of financial position should be read in conjunction with the accompanying notes.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

The above condensed consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

The above condensed consolidated statement of cash flows should be read in conjunction with the accompanying notes.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 1: STATEMENT OF COMPLIANCE

Wolf is a public company, limited by shares, domiciled and incorporated in Australia and listed on the Australian Securities Exchange and Alternative Investment Market. The interim financial report of the company for the six months ended 31 December 2014, comprise the Company and its subsidiaries ("Consolidated Entity" or "Group").

The interim financial report is a general purpose financial report prepared in accordance with the requirements of the Corporations Act 2001 and AASB 134 Interim Financial Reporting. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 Interim Financial Reporting.

The interim financial report does not include full disclosures of the type normally included in an annual financial report. Accordingly, it is recommended that this interim financial report be read in conjunction with the annual financial report for the year ended 30 June 2014 and any public announcements made by Wolf Minerals Limited and its controlled entities during the interim reporting period in accordance with the continuous disclosure requirements arising under the Corporations Act 2001.

These condensed consolidated financial statements were approved by the Board of Directors on

26 February 2015.

NOTE 2: BASIS OF PREPARATION

The condensed consolidated financial statements have been prepared on an accruals basis and are based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied. The presentation and functional currency is in Australian Dollars.

The accounting policies and methods of computation adopted in the preparation of the condensed consolidated financial statements are consistent with those adopted and disclosed in the Company's 2014 annual financial report for the financial year ended 30 June 2014, except for the impact of the Standards and Interpretations described below. Those accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards.

Going concern basis

At the date of approval of these condensed consolidated financial statements, and based upon the budgeted levels of expenditure and Board approved cash flow forecasts, the Directors are satisfied that the Company has sufficient cash and loan facilities to finance the Company's operating expenditure and the development of the Project.

The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for at least 12 months from the date of the signing these condensed consolidated financial statements and therefore they continue to adopt the going concern basis of accounting in preparing the condensed consolidated financial statements.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 2: BASIS OF PREPARATION (CONTINUED)

Critical accounting estimates and judgements

The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the end of the reporting period. Actual results may differ from these estimates.

Significant items subject to such estimates are set out in the Accounting Policies to the Company's 2014 annual report. The nature and amounts of such estimates have not changed significantly during the interim period, other than those required in determining the fair values of derivative financial instruments.

NOTE 3: SIGNIFICANT ACCOUNTING POLICIES

The condensed consolidated financial statements have been prepared under the historical cost convention.

The same accounting policies, presentation and methods of computation have been followed in these condensed consolidated financial statements as were applied in the preparation of the Company's 2014 annual report for the financial year ended 30 June 2014, except for the new accounting policies and impact of the adoption of the Standards and interpretations described below.

New accounting policies

Derivative financial instruments

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.

Derivatives are classified as current or non-current depending on the expected period of realisation.

Cash flow hedges

Cash flow hedges are used to cover the Consolidated Entity's exposure to variability in cash flows that is attributable to particular risk associated with a recognised asset or liability or a firm commitment which could affect profit or loss. The effective portion of the gain or loss on the hedging instrument is recognised directly in equity, whilst the ineffective portion is recognised in profit or loss. Amounts taken to equity are transferred out of equity and included in the measurement of the hedged transaction when the forecast transaction occurs.

Cash flow hedges are tested for effectiveness on a regular basis both retrospectively and prospectively to ensure that each hedge is highly effective and continues to be designated as a cash flow hedge. If the forecast transaction is no longer expected to occur, amounts recognised in equity are transferred to profit or loss.

If the hedging instrument is sold, terminated, expires, exercised without replacement or rollover, or if the hedge becomes ineffective and is no longer a designated hedge, amounts previously recognised in equity remain in equity until the forecast transaction occurs.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 3: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

New and amended standards and interpretations issued but not yet effective for the financial year beginning 1 July 2014 and not early adopted

The following Australian Accounting Standards have been issued or amended and are applicable to the annual financial statements of the Consolidated Entity (or the Company) but are not yet effective. This assumes the following have not been adopted in preparation of the financial statements at the reporting date.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 4: SEGMENT INFORMATION NOTES

The Consolidated Entity has identified its operating segments based on the internal reports that are reviewed and used by the Managing Director to make decisions about resources to be allocated to the segments and assess their performance.

The Consolidated Entity has one reportable segment being its mine development activities in the United Kingdom.

The financial information presented in the consolidated statement of profit or loss and other comprehensive income and statement of financial position is the same as that presented to the Managing Director.

NOTE 5: CONTINGENT LIABILITIES

As at 31 December 2014 the Consolidated Entity did not have any contingent liabilities.

NOTE 6: KEY MANAGEMENT PERSONNEL

Remuneration arrangements of key management personnel are disclosed in the annual financial report.

NOTE 7: EQUITY COMPENSATION BENEFITS

At total expense of $36,302 has been recognised in the statement of profit or loss and other comprehensive income at 31 December 2014. This amount relates entirely to equity compensation benefits awarded to employees of the Company. During the year the Company issued two tranches of performance rights and once tranche of options. Further details are provided below.

a) Performance rights issues

During the period ending 31 December 2014, the Company issued 2,953,418 performance rights to employees in accordance with the Wolf Minerals Limited Performance Rights Plan as readopted by shareholders at the Annual General Meeting held on 21 November 2014.

The vesting of the performance rights is subject to the following conditions:

a) 50% of performance rights will vest based on the Company's relative share price performance versus the AIM Basic Resources Index in accordance with a defined scale; and

b) 50% of performance rights will vest based upon the Company's Total Shareholder Return ("TSR") performance as measured over the vesting period.

The performance rights were valued by an independent third party using industry standard valuation techniques. The key inputs and valuations are summarised in the table below.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 7: EQUITY COMPENSATION BENEFITS (CONTINUED)

At 31 December 2014 all of the performance rights remained unvested and a total expense of $26,507 has been recognised in the statement of profit or loss and other comprehensive income as part of equity compensation benefits. The total value of the performance rights will be recognised in the statement of profit or loss and other comprehensive income on a pro-rata basis over the life of the respective performance rights.

b) Option issues

During the period ending 31 December 2014 the Company issued 850,000 options to an employee.

The options were valued using the Black Scholes valuation model with the key inputs and valuations summarised in the table below.

The options vested upon issue and a total expense of $9,795 has been recognised in the statement of profit or loss and other comprehensive income as part of equity compensation benefits.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

1 Other assets comprise a bond agreement and cash collateral deposits the Group has provided as security to various parties in connection with environmental restoration obligations. The bond and collateral deposits are not released until the underlying obligations have been fulfilled by the Group to the satisfaction of the UK authorities. The two major non-current collateral deposits are a £9.05M (~$17.2M) financial provision for the restoration bond and a £0.8M (~$1.52M) environmental waste permit.

The ultimate recoupment of mine development expenditure is dependent on the successful commercial development of the Project, including positive cash flows from production.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

The maximum notional principal amount of the outstanding interest rate swap contracts at 31 December 2014 was £35,738,570 (~A$68,096,271) (30 June 2014: £nil).

At 31 December 2014, the fixed interest rates vary from 0.68% to 2.05% (30 June 2014: nil %), and the main floating rate is LIBOR.

Senior Secured Loan and Bond Facility

On 10 May 2014 the Company signed documentation with UniCredit Bank AG, London Branch; ING Bank N.V.; and Caterpillar Financial SARL for £75 million in senior debt finance facilities, incorporating a £70 million term loan facility and a £5 million bond facility. The term loan facility comprises two tranches, A and B, amounting to £32 million and £38 million respectively.

The financing structure includes a portion of the senior debt facilities being supported by a guarantee provided by the German government's Untied Loan Guarantee Scheme (Ungebundene Finanzkredite ("UFK Guarantee")). The UFK Guarantee was issued in favour of the tranche A lenders relating to a minimum 90% of the tranche A element of the facility, in respect of commercial and political risks. An additional guarantee is in place through the Company's tungsten off-take partners, Wolfram Bergbau und Hütten AG and Global Tungsten & Powders Corp. Under the terms of the guarantee the Company has pledged the receivables due from the off-take partners as security for the loan facility. Together, these guarantees will cover approximately 50% of the senior loan facility.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 14: BORROWINGS (CONTINUED)

The senior debt facility has a term of 7.5 years and repayments are to be made on a quarterly basis, commencing approximately six months after first production. As at 31 December 2014 £27.5 million of the term loan has been drawn down and £5 million of the bond facility has been utilised.

Financing Arrangements

The following financing arrangements were in place at the year-end date

NOTE 15: FINANCIAL RISK MANAGEMENT

The Consolidated Entity's financial instruments consist mainly of deposits with banks, other receivables, trade and other payables, loans to the UK based subsidiary and derivative financial instruments.

The condensed consolidated financial statements do not include all financial risk management information and disclosures required in the annual financial statements; they should be read in conjunction with the annual financial statements as at 30 June 2014.

There have been no changes in the risk management department or in any risk management policies since the year end.

Market Risk

Foreign currency risk

During the period, the Consolidated Entity has entered into forward foreign exchange contracts. These contracts are to hedge the variability in the highly probable cash flows associated with the US$ receipts from future tungsten sales. The Consolidated Entity expects that there will be a close relationship between the hedge instrument (the FX forward contract) and the hedged item (US$ drawdown and US$ receipts).

The maturity, settlement amounts and the average contractual exchange rates of the Consolidated Entity's outstanding forward foreign exchange contracts at the reporting date was as follows:

The Consolidated Entity recognises the profits and losses resulting from currency fluctuations as and when they arise.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 15: FINANCIAL RISK MANAGEMENT (CONTINUED)

Cash flow and fair value interest rate risk

The Consolidated Entity manages its main interest risk arising from long-term borrowings by entering into interest rate swaps to fix the interest on 50% of its borrowings

The Consolidated Entity's bank loans outstanding, totalling £27,500,000 (~A$52,398,500) (30 June 2014: $nil), are interest payment loans (see note 14).

Based on various scenarios, the Consolidated Entity manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Such interest rate swaps have the economic effect of converting borrowings from floating rates to fixed rates. Under the interest rate swaps, the Consolidated Entity agrees with other parties to exchange, at specified intervals (primarily quarterly), the difference between fixed contract rates and floating-rate interest amounts, calculated by reference to the agreed notional amounts.

Liquidity risk

During the period, the Company has drawn down on its Senior Debt facility with outstanding bank loans amounting to £27,500,000.

The table below summarises the maturity profile of the Consolidated Entity's financial liabilities based on contractual undiscounted payments.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 16: FAIR VALUE MEASUREMENT

Fair value hierarchy

The following tables detail the Consolidated Entity's assets and liabilities, measured or disclosed at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: Unobservable inputs for the asset or liability.

At 30 June 2014, the Consolidated Entity did not have any assets or liabilities, measured or disclosed at fair value.

The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current market interest rate that is available for similar financial liabilities.

Valuation techniques for fair value measurements categorised within level 2.

Level 2 hedging derivatives comprise forward foreign exchange contracts, forward foreign exchange options and interest rate swaps. These forward foreign exchange contracts have been fair valued using forward exchange rates that are quoted in an active market. Interest rate swaps are fair valued using forward interest rates extracted from observable yield curves. The effects of discounting are generally insignificant for Level 2 derivatives.

This valuation technique maximises the use of observable market data where it is available and relies as little as possible on entity specific estimates.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 18: COMMITMENTS

(a) Mine development asset commitments

In order to maintain current rights of tenure to mine development assets, the Consolidated Entity has the following commitments up until expiry of leases. These obligations, which are subject to renegotiation upon expiry of the leases, are not provided for in the financial report and are payable:

If the Group decides to relinquish certain leases and/or does not meet these obligations, assets recognised in the statement of financial position may require review to determine the appropriateness of carrying values. The sale, transfer or farm-out of the mine development asset to third parties will reduce or extinguish these obligations.

(b) Lease expenditure commitments

The Group has entered into the following leases on commercial terms for office accommodation:

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2014

NOTE 18: COMMITMENTS (CONTINUED)

 (c) Other contractual commitments

EPC Contract

In 2013 Wolf Minerals (UK) Limited awarded a £75 million (~$143 million) Engineer Procure Construct ("EPC") contract for the Hemerdon tungsten and tin project to GR Engineering Services Limited.

The fixed price, fixed term EPC contract is for the design, construction and commissioning of a 3Mtpa tungsten and tin mineral processing plant plus associated infrastructure, forming the key component of the Hemerdon project.

As at 31 December 2014, EPC commitments contracted for but not yet incurred amounted to $27,239,431.

Mining Services Contract

In 2013 Wolf Minerals (UK) Limited awarded a £85 million (~A$162 million) Mining Services Contract ("MSC") for the Hemerdon tungsten and tin project to CA Blackwell (Contracts) Limited.

The MSC is rates based and made up of two parts:

· Phase 1, Mining pre-strip and Mine development,

· Phase 2, Mine production.

The MSC term for Phase 1 is 11 months from the commencement date, followed by Phase 2 which has a five year term from completion of Phase 1 work. The MSC is able to be terminated by Wolf at any time with 60 days' notice.

NOTE 19: DIVIDENDS

No dividends have been declared or paid during the half year ended 31 December 2014.

NOTE 20: EVENTS SUBSEQUENT TO REPORTING DATE

There were no events subsequent to the period ended 31 December 2014 that have significantly affected, or may significantly affect the Consolidated Entity's operations, the results of those operations, or the Consolidated Entity's state of affairs in future financial years. DIRECTORS' DECLARATION

The Directors of the Company declare that:-

1. The financial statements and notes, as set out on pages 7 to 23 are in accordance with the Corporations Act 2001, and:

(a) Complying with Accounting Standard AASB 134: Interim Financial Reporting and Corporation Regulations 2001; and

(b) Giving a true and fair view of the Consolidated Entity's financial position as at 31 December 2014 and of its performance for the half year ended on that date.

2. In the Directors' opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors:

_____________________________

Russell Clark

Managing Director

Dated: 26 February 2015

INDEPENDENT AUDITOR'S REVIEW REPORT

TO THE MEMBERS OF

WOLF MINERALS LIMITED

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of Wolf Minerals Limited (the Company) and controlled entities (Consolidated Entity) which comprises the condensed consolidated statement of financial position as at 31 December 2014, the condensed consolidated statement of profit or loss and other comprehensive income, the condensed consolidated statement of changes in equity and the condensed 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 31 December 2014, or 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 the Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the Directors determine is necessary to enable the preparation of the half-year financial report that gives a true and fair view and 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 half-year 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 2014 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporation Regulations 2001. As the auditor of Wolf Minerals Limited and the entities it controlled during the half year, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001. In accordance with the Corporations Act 2001, we have given the Directors' of the company a written Auditor's Independence Declaration.

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 Wolf Minerals Limited is not in accordance with the Corporations Act 2001 including:

(a) giving a true and fair view of the Consolidated Entity's financial position as at 31 December 2014 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 Matters

Without modifying our opinion, we draw attention to Note 1 in the financial report. The Consolidated Entity incurred a net loss after tax of $3,719,177 and had a net operating cash outflow of $4,356,712 during the half-year ended 31 December 2014. These conditions, along with other matters as set out in Note 1, indicates the existence of a material uncertainty that may cast significant doubt about the Company and Consolidated Entity's ability to continue as a going concern and therefore, the Company and Consolidated Entity may be unable to realise its assets and discharge its liabilities in the normal course of business.

The financial report of the Consolidated Entity and the Company does not include any adjustments in relation to the recoverability and classification of recorded asset amounts or to the amounts and classification of liabilities that might be necessary should the Company and/or the Consolidated Entity not continue as going concerns.

PKF Mack

Simon Fermanis

Partner

26 February 2015

West Perth,

Western Australia