Half Yearly Report

RNS Number : 0233I

Rare Earth Minerals PLC

07 June 2011

Rare Earth Minerals plc (formerly Zest Group plc)

Interim Results

for the six months ended 31 March 2011

Rare Earth Minerals plc (formerly Zest Group plc (AIM: REM.L), announces its interim results for the six months ended 31 March 2011.

During the period the Group made a loss before taxation of £196,000 (2010: loss £194,000). There was a loss per share of 0.02p (2010: loss per share 0.05p).

Current trading

During the period under review the Company has continued to make progress on several fronts.

On 29 November 2010, the Shareholders approved and adopted an Investing Policy to acquire direct and indirect interests in exploration, development and producing Rare Earth Minerals and/or Metals projects and assets. In light of the nature of the assets and projects which will be the focus of the Investing Policy the Company will consider investment opportunities anywhere in the world. The intention is to acquire a widely distributed mix of Rare Earth Minerals and Metals development and producing assets.

In line with its new investing policy the Company changed its name to Rare Earth Minerals plc and its new website address has changed to www.rareearthminerals plc.com. The Company's new EPIC is 'REM' and it commenced trading under its new name and EPIC effective from 1 December 2010.

On 2 February 2011, the Company announced the appointment of Adrian Fairbourn to the board as a non-executive director.

On 4 May 2011, the Company announced it had entered into an agreement to acquire interests in 5 claims (No's S111889 to S111893) in Saskatchewan, Canada . The claims are situated in the Mudjatik domain, an area which has seen several periods of intensive exploration activity and hosts many interesting mineral showings. The claims consist of 3 separate groups totaling approximately 4,855 hectares in area. They are located in north central Saskatchewan and range from 5 to 16 kilometres west of a major highway and power facilities.

Under its agreement with the individual vendors of the interest ('the Cup Lake Syndicate'), Rare Earth Minerals may earn up to a 51% interest in the above mentioned properties after having paid a cash settlement of $50,000 USD and incurring exploration expenditures of at least $30,000 within 3 months. The Cup Lake Syndicate will act as the operator of an initial sampling program and will produce a report within 30 days of completion of this program. After review of this report, Rare Earth Minerals may elect to further participate in the development of these properties on a pro rata basis or alternatively, to not participate, in which case interest will be reduced to zero.

The Cup Lake deal is the first Rare Earth Minerals investment since the Company shareholders resolved on 29 November 2010 to adopt a change in investing policy to acquire a diverse portfolio of direct and indirect interests in exploration and producing Rare Earth Minerals and/or Metals projects and assets.

The agreement is conditional, inter-alia, on REM being satisfied with the title to the claims and the parties have agreed to use best efforts to have a final agreement confirming a closing date by 15 June 2011.

Background of the area;

During the 1950's exploration of was concentrated only on the accessible and mapped areas of the time. The focus was solely for uranium and was met with some success as uraninite showings were identified in numerous instances. In the 1960's exploration surged again, this time prospecting centered around the search for base metals and much of the area was flown with geophysical surveys. Drilling was undertaken and some anomalous nickel assays were obtained in core assays.

It was during these periods of exploration for other minerals that the potential for rare earth elements ("REE") was revealed. Monazite and allanite bearing porphyry dykes and irregular masses up to 30 feet wide were discovered, both have the potential for hosting heavy rare earth elements. Occurrences such as these suggest there may be sufficient mineralization in the area to support complex pegmatites hosting many types of rare earths. Drill and assay results seeking uranium and base metalsalso reported niobium and tantalum mineralization associated with uranium occurrences in pegmatites.

David Lenigas, Rare Earth Minerals Director and CEO commented at the time;

"The Cup Lake REE deal is the first of a number of investment opportunities that the Company is assessing. Historically this area has received considerable attention for base metals and Uranium, but never in terms of the exploiting rare earth potential. Current day technology has facilitated a tremendous demand for these elements and we are eager to commence exploration focused exclusively uncovering the rare earths of this prospective area".

Richard Griffiths

Chairman

07 June 2011

RARE EARTH MINERALS PLC (FORMERLY ZEST GROUP PLC)

STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 31 MARCH 2011

	Note		Unaudited Six months ended 31 March 2011		Unaudited Six months ended 31 March 2010		Audited Year ended 30 September 2010
			£'000		£'000		£'000

Administrative expenses
- impairment of advance payments to artists				-		-		(1)
- other administrative expenses				(196)		(194)		(283)

Total administrative expenses				(196)		(194)		(284)

Loss from operations				(196)		(194)		(284)

Loss for the period before taxation				(196)		(194)		(284)

Taxation expense				-		-		-
Loss for the period after taxation and loss attributable to the equity holders of the company				(196)		(194)		(284)

Other comprehensive income				-		-		-

Total comprehensive expenditure for the period				(196)		(194)		(284)


Basic and diluted loss per ordinary share (pence)		4		(0.02)p		(0.05)p		(0.06)p

RARE EARTH MINERALS PLC (FORMERLY ZEST GROUP PLC)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 31 MARCH 2011

	Share capital	Share premium	Share based payment reserve	Retained earnings	Total equity
	£'000	£'000	£'000	£'000	£'000

At 31 March 2010 (unaudited)	464	3,868	190	(4,536)	(14)
Share based payments	-	-	25	-	25
Transactions with owners	-	-	25	-	25
Loss for the period	-	-	-	(90)	(90)
Total comprehensive expenditure for the year	-	-	-	(90)	(90)
At 30 September 2010 (audited)	464	3,868	215	(4,626)	(79)
Share based payments	-	-	56	-	56
Issue of share capital	42	573	-	-	615
Transactions with owners	42	573	56	-	671
Loss for the period	-	-	-	(196)	(196)
Total comprehensive expenditure for the period	-	-	-	(196)	(196)
At 31 March 2011 (unaudited)	506	4,441	271	(4,822)	396

RARE EARTH MINERALS PLC (FORMERLY ZEST GROUP PLC)

STATEMENT OF FINANCIAL POSITION

AS AT 31 MARCH 2011

	Note	Unaudited 31 March 2011	Unaudited 31 March 2010	Audited 30 September 2010
		£'000	£'000	£'000
ASSETS

Current assets
Trade and other receivables		173	47	17
Cash and cash equivalents		233	30	306
Total current assets		406	77	323

Total assets		406	77	323

EQUITY AND LIABILITIES

Current liabilities
Trade and other payables		10	91	402
Total current liabilities and total liabilities		10	91	402



Equity
Share capital	5	506	464	464
Share premium		4,441	3,868	3,868
Share based payment reserve		271	190	215
Retained earnings		(4,822)	(4,536)	(4,626)
Total equity attributable to equity holders		396	(14)	(79)

Total equity and liabilities		406	77	323

RARE EARTH MINERALS PLC (FORMERLY ZEST GROUP PLC)

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIOD 31 MARCH 2011

	Unaudited Six months ended 31 March 2011	Unaudited Six months ended 31 March 2010	Audited Year to 30 September 2010
	£'000	£'000	£'000

Operating activities
Loss after taxation	(196)	(194)	(284)
Adjustments for:
Depreciation	-	1	1
Increase in trade and other receivables	(6)	(35)	(5)
Decrease in trade and other payables	(392)	(60)	251
Equity settled share based payments	56	13	38
Net cash (outflow)/inflow from operating activities	(538)	(275)	1

Cash flow from financing activities
Proceeds from issue of share capital	630	300	300
Share issue costs	(15)	-	-
New loan	(150)	-	-
Net cash inflow from financing activities	465	300	300

Net change in cash and cash equivalents	(73)	25	301

Cash and cash equivalents at beginning of period	306	5	5

Cash and cash equivalents at end of period	233	30	306

NOTES TO THE INTERIM REPORT

FOR THE PERIOD ENDED 31 MARCH 2011

1. GENERAL INFORMATION

The financial information for the period ended 31 March 2011 does not constitute statutory accounts as defined in Section 498 of the Companies Act 2006. The figures for the year ended 30 September 2010 have been extracted from the 2010 statutory financial statements. The auditors' report on those accounts was unqualified and did not contain a statement under section 237(2) of the Companies Act 2006.

2. BASIS OF PREPARATION

The Company's shares are listed on the AIM market of the London Stock Exchange and the Company applies the Companies Act 2006 when preparing its annual financial statements.

The annual financial statements will be prepared under IFRS and the principal accounting policies adopted remain unchanged from those adopted by Rare Earth Minerals plc in preparing its financial statements for the year ended 30 September 2011.

The accounting policies have been applied consistently throughout the Group for the purposes of

preparation of these condensed consolidated interim financial statements

Interim financial information in this report has been neither audited nor reviewed by the Group's auditors.

GOING CONCERN

The Directors have prepared cash flow forecasts for the period ending 30 June 2012, incorporating the £2,100,000 before placing costs raised from the share issue on 5 May 2011. The forecasts demonstrate that the Group has sufficient funds to allow it to continue in business for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the accounts have been prepared on a going concern basis.

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results

3. SEGMENTAL REPORTING

An operating segment is a distinguishable component of the Group that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the Group's chief operating decision maker to make decisions about the allocation of resources and assessment of performance and about which discrete financial information is available.

The chief operating decision maker reviews financial information for and makes decisions about the Group's performance as a whole. The Group has not actively traded during the period.

Subject to further acquisitions the Group expects to further review its segmental information during the forthcoming financial year.

4. LOSS PER SHARE

The calculation of the loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period.

	Unaudited Six months ended 31 March 2011	Unaudited Six months ended 31 March 2010	Audited Year ended 30 September 2010

Loss for the period from total operations (£'000)	(196)	(194)	(284)

Weighted average number of 0.25p ordinary shares	877,465,204	412,630,039	443,208,091

Loss per share from total operations	(0.02)p	(0.05)p	(0.06)p

The share options are anti-dilutive, as a consequence of the loss for the period.

5 SHARE CAPITAL

	Unaudited 31 March 2011	Unaudited 31 March 2010	Audited 30 September 2010
	£'000	£'000	£'000
Authorised
4,000,000,000 ordinary shares of 0.01p	400	400	400
4,000,000,000 deferred shares of 0.24p	9,600	9,600	9,600
4,000,000,000 ordinary shares of 0.25p
	10,000	10,000	10,000

Allotted, issued and fully paid
173,619,050 deferred shares of 0.24p	417	417	417
893,619,050 ordinary shares of 0.01p (31 March 2010 and 30 September 2010: 473,619,050 ordinary shares of 0.01p)	89	47	47

	506	464	464