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Orchid Capital Ltd (ORC)

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Tuesday 13 September, 2005

Orchid Capital Ltd

Final Results

Orchid Capital Ltd
13 September 2005

                            ORCHID CAPITAL LIMITED
                               (ACN 073 099 171)

                               ANNUAL REPORT AND
                              FINANCIAL STATEMENTS

                           YEAR ENDED 30th JUNE 2005

                               TABLE OF CONTENTS

CORPORATE DIRECTORY....................................1

REVIEW OF OPERATIONS...................................2

CORPORATE GOVERNANCE...................................4

DIRECTORS' REPORT......................................7


STATEMENT OF FINANCIAL POSITION.......................13

STATEMENT OF CASHFLOWS................................14

DIRECTORS' DECLARATION................................35


                             CORPORATE DIRECTORY


C. McKee
N. Grafton
A. Tan
J. Sandt


N. Grafton


Suite 3, Ground Floor
610 Murray Street
West Perth, Western Australia, 6005
Telephone: +618 9321 3664
Facsimile: +618 9322 6887
Email: [email protected]


Stanton Partners
Level 1
1 Havelock Street
West Perth, Western Australia, 6005


Advanced Share Registry Services Pty Ltd
110 Stirling Highway
Nedlands, Western Australia, 6909
Telephone: +618 9389 8033
Facsimile: +618 9389 7871


The Company is triple-listed on the Australian Stock Exchange Limited, the
Alternative Investment Market (AIM) and Deutsche Borse AG.

Home Exchange - Perth, Australia

ASX Code  -  ORC
AIM Code  -  ORC
WKN Code  -  924249


A C N    073 099 171
A B N    30 073 099 171

                              REVIEW OF OPERATIONS

The year has been a busy one for Orchid Capital Limited (ORC), culminating in
achieving an official listing on the Alternative Investment Market (AIM) of the
London Stock Exchange in June.  Listing on London's AIM adds to Orchid's other
listings on the Australian Stock Exchange (ASX) and Germany's Deutsche Borse
(DAX).  The listing on AIM offers the Company additional international exposure
and increases the potential to attract European investors and increases access
to capital.

In June 2004, ORC established a fully owned subsidiary, Orchid Resources Limited
(ORL), to pursue the exploration and development of resource opportunities in
the People's Republic of China.

ORL contracted its initial mining deal in December 2004 by becoming the first
foreign company in the world to receive approval for a mining Cooperative Joint
Venture in Tibet.  The Tibet Pioneer Mining Company (TPMC) is a joint venture
between ORL (70%) and the China Tibet Institute of Geology Survey (CTIGS) (30%).

In addition to the existing gold project at Nagarze, ORL also signed Letters of
Intent in February 2005 to acquire, explore and potentially develop two copper
porphyry deposits at Qu Long (pronounced choo long) and Jia Ma (pronounced
gee-ah mah), both located east of Tibet's capital, Lhasa.

In April 2005, independent Australian mining consulting group Ausenco Limited
conducted a full technical due diligence evaluation of the Qu Long and Jia Ma
projects.  The report concluded that the resource for Qu Long was appropriately
classified as an Inferred Resource under the Joint Ore Reserves Committee (JORC)
classification system.

Unfortunately, in August 2005, the Company was made aware of a competing bidder
for the Qu Long project, and has subsequently concluded that the chances for
success in view of the competition were slim.  It was with great disappointment
that the Board had to review its position with the China Tibet Institute of
Geology Survey and concluded that it would no longer pursue the projects covered
by the Letter of Intent with the CTIGS.  The Board formed the view that it would
be difficult for the Tibet Autonomous Region government to deal with ORL in view
of the local competitor, who, we believe, will be the likely winner in such a

ORL has also completed the 200 metre adit at the Nagarze gold prospect, together
with accompanying assays.  Much of the adit has anomalous gold values in the
range of 0.2 to 0.4 g/t Au. Peak value was 2.06 g/t in the adit, which compared
with peak surface values of 5.6 g/t Au.  The adit tested an area which was
indicated with the use of ASTER (Advanced Space borne Thermal Emission
Reflection Radiometer) satellite imagery.  After due commercial consideration,
the Company decided that it would not proceed with test drilling of the

The Company has been released from its obligations under the joint venture
agreement, including its obligations to fund tenement exploration and
feasibility study and is now considering other alternatives with regard to its
investment in ORL.

Orchid EMARB Ltd (EMARB) is an international offshore fund established in 2002
with funds of €2.5 million.  The fund invests principally in investment grade
euro bonds.  Orchid enjoyed a profit for the year of €418,710, an increase of
108% year on year.  This is a return of 13.4% on funds invested.  At the end of
the financial year ending 30 June 2005, cash represented 27% of the portfolio.
The Board continues to monitor the market closely and maintains a conservative
perspective in its investments.

Orchid has a 23.2% interest in the Jiva Resort and Spa located in Kata Beach,
Phuket.  The Board certainly has the utmost respect for the forces of nature as
yet again another external factor adversely affected our investments.  However,
we were fortunate that the 2004 Boxing Day tsunami which devastated large areas
of southern Asia, did not physically damage the Resort, and all staff and guests
at Jiva Resort were reported safe.  Although the resort was spared the worst of
the tragedy, occupancy for the following months was significantly impacted.
Management of Jiva has done a tremendous job, and is now looking towards a
return to normal occupancy and rates.

The Company currently has approximately $5 million in liquid assets, and is
seeking to rationalize some of its investments.  The Board is actively pursuing
other high growth opportunities, in particular with a view to taking advantage
of strong growth potential in China and the impact of such growth on various


                              CORPORATE GOVERNANCE

The Board of Directors of Orchid Capital Limited ('Orchid') is responsible for
the corporate governance of the economic entity.  The Board guides and monitors
the business and affairs of Orchid on behalf of the shareholders by whom they
are elected and to whom they are accountable.

To ensure that the Board is well equipped to discharge its responsibilities, it
has established guidelines for the nomination and selection of directors and for
the operation of the Board.


The composition of the Board is determined in accordance with the following
principles and guidelines:

•    the Board should comprise at least four directors and it intends to
     establish a majority of non-executive directors;

•    the Chairman should be a non-executive director, although this has not
     yet been achieved;

•    the Board should comprise directors with an appropriate range of
     qualifications and expertise; and

•    the Board shall meet at regular intervals and follow meeting guidelines 
     set down to ensure all directors are made aware of, and have available all 
     necessary information, to participate in an informed discussion of all 
     agenda items.

When a vacancy exists, through whatever cause, or where it is considered that
the Board would benefit from the service of a new director with particular
skills, the Board selects a candidate or panel of candidates with the
appropriate expertise.

The Board then appoints the most suitable candidate, who must stand for election
at the next general meeting of shareholders.  The Company does not have a formal
Nomination Committee.


Remuneration levels are set by the Board in accordance with industry standards
to attract suitable qualified and experienced Directors and senior executives.


The company is not of a size that justifies having a separate Audit Committee.
However, matters typically dealt with by such committees are dealt with by the
full Board.


As the Board acts on behalf of and is accountable to the shareholders, it seeks
to identify the expectations of the shareholders, as well as other regulatory
and ethical expectations and obligations.  In addition, the Board is responsible
for identifying areas of significant business risk and ensuring arrangements are
in place to adequately manage those risks.  The Board seeks to discharge these
responsibilities in a number of ways.

The responsibility for the operation and administration of the economic entity
is delegated by the Board to the Managing Director.  The Board ensures that the
Managing Director is appropriately qualified and experienced to discharge his
responsibilities, and has in place procedures to assess the performance for the
Company's officers, contractors and consultants.

The Board is responsible for ensuring that management's objectives and
activities are aligned with the expectations and risks identified by the Board.
 It has a number of mechanisms in place to ensure this is achieved, including
the following:

•    Board approval of a strategic plan, designed to meet shareholder needs
     and manage business risk;

•    implementation of operating plans and budgets by management and Board
     monitoring progress against budget;

•    procedures to allow directors, in the furtherance of their duties, to
     seek independent professional advice at the Company's expense.


In order to ensure that the Board continues to discharge its responsibilities in
an appropriate manner, the performance of all directors is to be reviewed
annually by the chairperson.  Directors whose performance is unsatisfactory are
asked to retire.


Outlined below are the 10 Principles of Good Corporate Governance and Best
Practice Recommendations as outlined by the ASX and the Corporate Governance
Council, along with details as to whether the Principles had been adopted at 30
June 2005 and if not, the reasons why not adopted.

                                                                             Action taken and reasons
                                                                                  if not adopted

Recognise and publish the respective roles and responsibilities of   Adopted
the board and management

Principle 1: Lay solid foundation for management and oversight

1.1     Formalise and disclose the functions reserved to the Board
        and those delegated to management

Have a board of an effective composition, size and commitment to     Adopted except as follow:-
adequately discharge its responsibilities and duties
                                                                     The company is not of a size that
Principle 2:  Structure the board to add value                       justifies having a separate Nomination,
                                                                     Remuneration and Audit Committees.
2.1     A majority of the Board should be independent                However, matters typically dealt with by
                                                                     such committees are dealt with by the
2.2     The chairperson should be an independent director            full Board.  Only one of the five Board
                                                                     members is considered independent.  This
2.3     The roles of chairperson and chief executive officer should  matter will be addressed over the next
        not be exercised by the same individual                      few years, depending upon the growth of
                                                                     the Company.
2.4     The board should establish a nomination committee

2.5     Provide the information indicated in 'Guide to reporting on
        Principle 2

Actively promote ethical and responsible decision-making             Adopted

Principle 3: Promote ethical and responsible decision-making

3.1     Establish a code of conduct to guide the directors, the
        chief executive officer (or equivalent), the chief 
        financial officer (or equivalent) and any other key 
        executives as to:

3.1.1   the practices necessary to maintain confidence in the
        company's integrity

3.1.2   the responsibility and accountability of individuals for
        reporting or investigating reports of unethical practices

3.2     Disclose the policy concerning trading in company securities
        by directors, officers and employees

3.3     Provide the information indicated in 'Guide to Reporting on
        Principle 3'

Have a structure in place to independently verify and safeguard the  Adopted
integrity of the company's financial reporting

Principle 4: Safeguard integrity in financial reporting

4.1     Require the chief executive officer (or equivalent) and the
        chief financial officer (or equivalent) to state in writing
        to the Board that the company's financial reports present a
        true and fair view, in all material respects, of the 
        company's financial condition and operational results and 
        are in accordance with relevant accounting standards.

4.2     The board should establish an audit committee                The company is not of a size that
                                                                     justifies having a separate Audit
                                                                     Committees.  However, matters typically
                                                                     dealt with by such committees are dealt
                                                                     with by the full Board.

4.3     Structure the audit committee so that it consists of:

        •    Only non-executive directors
        •    A majority of independent directors
        •    An independent chairperson who is not the chairperson
             of the Board
        •    At least three members

4.4     The audit committee should have a formal operating charter

4.5     Provide the information indicated in the 'Guide to reporting
        on Principle 4'

Promote timely and balanced disclosure of all material matters       Adopted
concerning the company

Principle 5: Make timely and balanced disclosure

5.1     Establish written policies and procedures designed to ensure
compliance with ASX Listing Rule disclosure requirements and to
ensure accountability at a senior management level for that
5.2     Provide the information indicated in the 'Guide to reporting
on Principle 5'

Respect the rights of shareholders and facilitate the effectiveness  Adopted
of those rights

Principle 6: Respect the rights of shareholders

6.1     Design and disclose a communications strategy to promote
        effective communication with shareholders and encourage 
        effective participation at general meetings.

6.2     Request the external audit to attend the annual general
        meeting and be available to answer shareholder questions
        about the audit and the preparation and content of the 
        auditor's report

Establish a sound system of risk oversight and management and        Adopted
internal control

Principle 7: Recognise and manage risk

7.1     The Board or appropriate Board committee should establish
        policies on risk oversight and management

7.2     The chief executive officer (or equivalent) and the chief
        financial officer (or equivalent) should state tot he 
        Board in writing that:

7.2.1   the statement given in accordance with best practice
        recommendation 4.1 (the integrity of financial 
        statements) is founded on a sound system of risk 
        management and internal compliance and control which
        implements the policies adopted by the Board

7.2.2   the company's risk management and internal compliance and
        control system is operating efficiently and effectively 
        in all material respects.

7.3     Provide the information indicated in the 'Guide to reporting
        on Principle 7'

Fairly review and actively encourage enhanced board and management   Adopted

Principle 8: Encourage enhanced performance

8.1     Disclose the process for performance evaluation of the
        Board, its committees and individual directors, and 
        key executives

Ensure that the level and composition of remuneration is sufficient  Adopted
and reasonable and that its relationship to corporate and individual
performance is defined

Principle 9: Remunerate fairly and responsibly

9.1     Provide disclosure in relation to the company's remuneration
        policies to enable investors to understand (i) the cost and 
        benefits of these policies and (ii) the link between 
        remuneration paid to directors and key executives and 
        corporate performance.

9.2     The board should establish a remuneration committee

9.3     Clearly distinguish the structure of non-executive
        directors' remuneration from that of executives

9.4     Ensure that payment of equity-based executive remuneration
        is made in accordance with thresholds set in plans 
        approved by shareholders

Recognise the legal and other obligations of all legitimate          Adopted

Principle 10: Recognise the legitimate interest of stakeholders

10.1    Establish and disclose a code of conduct to guide compliance
        with legal and other obligations to legitimate stakeholders


The Board of Directors of Orchid Capital Limited have pleasure in presenting
their report on the consolidated entity consisting of Orchid Capital limited and
the entities controlled at the end of or during the year ended 30 June 2005.


The names and details of the Directors in office at the date of this report are:

Clive McKee (Chairman)

Mr McKee has extensive experience in global asset management and corporate
finance through his previous positions with securities and fund management
companies such as Yamaichi Securities, Societe General, Australia and New
Zealand Banking Group Limited, Westminster Fund Management GMBH, Pacific Fund
Management Asia, Pacific Rim Investment Corporation Limited and formerly
Chairman of Magna Pacific (Australia) Holdings Limited.

Norman Grafton (Finance Director and Company Secretary)

Mr Grafton (FCPA, FCIS) has had considerable experience in both Australian and
international commerce, having previously been based in Singapore, Indonesia,
Papua New Guinea and Jamaica.  Prior to returning to Australia, he was Director
of Finance and Company Secretary of the largest agro-industrial operation in
Jamaica on secondment from a major UK firm of corporate managers.

Alvin Tan (Managing Director)

Mr Tan is a Bachelor of Commerce graduate with Honours from the University of
Western Australia and worked for KPMG Peat Marwick in Kuala Lumpur from 1993 to
1995.  He has also worked with stockbroking house, DJ Carmichael Pty Ltd, as an
investment adviser where he specialized in the Asia Pacific Equity Markets.  He
has previously served on the Board of Pacific Rim Investment Corporation and is
currently a Director of Blink Models Limited.

Julian Sandt (Non-Executive Director)

Mr Sandt holds a German MBA from the Koblenz Business School (WHU Koblenz).
From 1993 to 2000, he held various positions with Commerzbank AG in Frankfurt,
Paris and Singapore.  Last position held was Manager Capital Markets and
Syndications.  From 2000 to 2004, Mr Sandt was Managing Partner of TFG Venture
Capital (Asia) Pte Ltd, Singapore.  Since 2004, Mr Sandt has held the position
of Senior Partner at Aegis Private Capital Pte Ltd, Singapore.


As at the date of this report, the interests of the Directors in the shares and
options of the Company are:

Names                               Fully Paid Shares              30th November 2006
                                                                    Options (Listed)*
C. McKee                                1,250,000                       1,250,000
N. Grafton                                  -                           1,000,000
A. Tan                                   460,000                        1,000,000
J. Sandt                                 100,000                        1,000,000

* Listed, exercisable at 5 cents on or before 30 November 2006


The Board reviews the remuneration packages of all Directors and any Executive
Officers.  The Board does not have any formal remuneration policy, but any
decision on remuneration increases or bonuses is made having due regard to the
Consolidated Entity's performance and other relevant factors.

Details of the nature and amount of each element of remuneration of each
Director of the Consolidated Entity paid or payable by the Consolidated Entity
during the financial year are as follows:

Remuneration of Specified Directors and Specified Executives
Specified Directors

Name of                                                                                     Equity
Specified                                                                                Compensation
Director                                         Salary       Fees     Superan-nuation     Benefits      Total
              Office Held                           $          $               $              $            $

C. McKee      Chairman (Appointed 9 September            -    141,552                 -              -    141,552
A. Tan        Managing Director                    147,822          -            14,250              -    162,072
N. Grafton    Finance Director & Company           110,696          -            34,000              -    144,696
J. Sandt      Non-Executive Director                     -     31,709                 -              -     31,709
C. McKee      Executive Director                         -    141,552                 -              -    141,552
J. Sandt      Non-Executive Director                     -     31,709                 -              -     31,709
R. Kestel     Chairman (Retired 1st July 2005)           -     31,354                 -              -     31,354
Dr. D.        Chairman (Appointed 1st July               -          -                 -              -          -
Tyrwhitt      2005, Retired 9th September

Specified Executives

Name of                                                                                     Equity
Specified                                                  Salary &                       Compensation
Executive                                             Consultancy Fees   Superan-nuation   Benefits         Total
             Office Held                                       $                $             $              $

Dr. D.       Exploration Director of Orchid                  216,000                 -        320,000     536,000
Tyrwhitt     Resources Limited (Resigned 1st
             September 2005)
S. Dobson    Executive Director of Orchid                     80,500             7,245         75,000     162,745
             Resources Limited (Resigned February


At the date of this report, the unissued ordinary shares of Orchid Capital
Limited under option are as follows:

Grant Date                Date of Expiry     Exercise Price         Number under
                                                   $                   Option

4th October 2002        30th November 2006         0.05

26th November 2003      30th November 2006         0.05               99,255,521

No person entitled to exercise these options had or has any right by virtue of
the option to participate in any share issue of any other body corporate.


During the year ended 30th June 2005 the Company held eight meetings of
Directors.  The attendances of Directors at meetings of the Board were:

Name             Number held and             Number
                entitled to attend          attended

N. Grafton               8                     8

C. McKee                 8                     8

A. Tan                   8                     8

R. Kestel                8                     8

J. Sandt                 8                     6


The principal activities of the economic entity during the year were investment
and mineral exploration.


The operating loss after income tax of the economic entity for the year ended
30th June 2005 was $4,384,072 (2004: $1,551,357).


No dividend has been paid during the financial year and no dividend is
recommended for the current year.


There were no significant changes in the state of affairs of the economic entity
during the financial year not otherwise dealt with in this report and the
financial statements.   A full review on the operations of the Orchid Group, are
set out under 'Review of Operations' in the Annual Report.


The Company has entered into an Officer's Protection Deed with the Directors to
indemnify each of them against any liability that may be incurred in relation to
his duties as an officer of the Company to the extent permitted by the law.


The Directors continue to examine other high growth investment opportunities,
with the view to taking advantage of strong growth potential in China and the
impact of such growth on various industries.  The Company is also seeking to
expedite the rationalisation of non-performing assets to increase the capital
base for other investment opportunities.


The Directors are not aware of any matters or circumstances at the date of the
report, other than those referred to in this report or the financial statements
or notes thereto, that have significantly affected or may significantly affect
the operations, the results of operations or the state of affairs of the
Consolidated Entity in subsequent financial years.  This Report is made in
accordance with a resolution of the Directors.

Alvin Tan
Managing Director
Perth, Western Australia
13th September 2005

                       FOR THE YEAR ENDED 30th JUNE 2005

                                                           Consolidated Entity            Parent Entity
                                                           2005           2004          2005           2004
                                              Note          $              $              $             $

Revenue from ordinary activities                2         13,823,398      5,305,664       115,561        136,245

Employee benefits expense                                  (366,717)      (420,651)     (366,717)      (420,651)
Depreciation expense                                        (16,855)       (10,435)      (16,855)       (10,435)
Consultancy and other professional fees                    (234,500)      (234,464)     (228,701)      (228,567)
Computer and office expenses                               (190,885)      (171,058)     (190,885)      (170,352)
Travelling and entertainment expenses                       (39,828)       (40,080)      (39,828)       (40,080)
Provision for write down of investments                     (56,670)       (93,220)     (229,696)      (870,669)
Cost of investments sold                                (13,049,851)    (4,826,210)      (49,750)       (20,000)
Exploration and evaluation costs written                 (3,500,194)      (354,499)             -              -
AIM Listing Expenses                                       (146,881)              -     (146,881)              -
Other expenses from ordinary activities                    (144,645)      (117,381)      (65,240)       (48,082)
Write off of Unrecoverable Investment &                            -              -   (3,165,080)
Share of net losses of associates accounted     3          (201,966)      (589,023)             -              -
for using equity method
Loss from ordinary activities before income     3        (4,125,594)    (1,551,357)   (4,384,072)    (1,672,591)
tax expense
Income tax expense relating to ordinary         4                  -              -             -              -
Net Loss attributable to members of the                  (4,125,594)    (1,551,357)   (4,384,072)    (1,672,591)
parent entity

Total changes in equity other than those       14        (4,125,594)    (1,551,357)   (4,384,072)    (1,672,591)
resulting from transactions with owners as

Basic earning per share (cents per share)      15             (2.72)         (1.12)

Diluted earnings per share has not been included, as it results in a more
favourable earnings per share figure than basic earnings per share.

The accompanying notes form part of these financial statements.

                         STATEMENT OF FINANCIAL POSITION
                              AS AT 30th JUNE 2005

                                                  Consolidated Entity                  Parent Entity
                                                  2005           2004           2005          2004
                                      Note         $              $              $              $

Cash assets                          16(b)        2,162,621      2,774,618        595,489     1,482,137
Receivables                            5             45,111         34,620         24,142         5,515
Other financial assets                 6          3,160,971      4,125,506              -             -
Other                                                     -              -                            -
TOTAL CURRENT ASSETS                              5,368,703      6,934,744        619,631     1,487,652


Receivables                            5              4,337              -          4,337       354,499
Investments                            7            936,192      1,206,307      5,255,652     5,535,098
Property, plant and equipment          8             48,340         39,212         48,340        39,212
Exploration and evaluation                                -              -                            -
TOTAL NON-CURRENT ASSETS                            988,869      1,245,519      5,308,329     5,928,809

TOTAL ASSETS                                      6,357,572      8,180,263      5,927,960     7,416,461

Payables                               10           157,487         48,075        148,094        33,238
Provisions                             11            55,053         23,628         55,053        23,628
Other financial liabilities          22(c)            6,718         38,834              -             -
TOTAL CURRENT LIABILITIES                           219,257        110,537        203,147        56,866


Provisions                             11            38,333         23,565         38,333        23,565

TOTAL NON CURRENT LIABILITIES                        38,333         23,565         38,333        23,565

TOTAL LIABILITIES                                   257,590        134,102        241,480        80,431

NET ASSETS                                        6,099,982      8,046,161      5,686,480     7,336,030


Contributed Equity                     12        31,612,407     28,846,935     31,612,407    28,846,935
Reserves                               13           142,058        728,115        564,678       595,630
Accumulated losses                     14      (25,654,483)   (21,528,889)   (26,490,605)  (22,106,535)
TOTAL EQUITY                                      6,099,982      8,046,161      5,686,480     7,336,030

The accompanying notes form part of these financial statements.

                            STATEMENT OF CASHFLOWS
                       FOR THE YEAR ENDED 30th JUNE 2005

                                                   Consolidated Entity           Parent Entity
                                                    2005          2004         2005           2004
                                           Note        $           $             $              $

Payments to suppliers, contractors and                                         (823,663)       (759,115)
                                                    (908,618)    (828,329)
Sundry income                                           1,290            -         1,290               -
Interest received                                     295,144      219,441        44,819          89,775
Effect of translating foreign financial                                                -               -
                                                     (78,462)            6
Net cash used in operating activities    16(a)      (690,646)    (608,882)     (777,554)       (669,340)


Purchase of plant and equipment                      (26,077)     (32,041)      (26,077)        (32,041)
Payment for investments                          (12,436,293)  (7,714,700)      (64,103)       (124,671)
Miming Tenements and Exploration                                                       -               -
                                                  (1,900,194)    (354,499)
Proceeds from investments                          13,338,566    4,956,120        68,043          29,670
Net receipts on derivative instruments                157,314      123,801             -               -
Net cash generated (used in)/from                                               (22,137)       (127,042)
investing activities
                                                    (866,684)  (3,021,319)


Net proceeds from share and option issues           1,059,521      420,540     1,059,521         420,540
Loan provided to an associate                               -            -             -               -
Loan provided to an entity                                  -    (450,000)             -       (450,000)
Repayment of loan provided to an entity                     -      450,000             -         450,000
Loan provided to a subsidiary                               -            -   (1,146,478)       (354,499)
Loan repaid by a subsidiary                                 -            -             -               -
Net cash inflow financing activities                1,059,521      420,540      (86,957)          66,041

Net (decrease)/increase in cash held                (497,809)  (3,209,661)     (886,648)       (730,341)
Cash Assets at 1 July 2004                          2,774,618    5,893,064     1,482,137       2,212,478
Effect of exchange rates on cash holdings                                              -               -
in foreign operations
                                                    (114,188)       91,215
Cash Assets at 30 June 2005              16(b)      2,162,621    2,774,618       595,489       1,482,137

The accompanying notes form part of these financial statements.


Financial Reporting Framework

The financial report is a general-purpose financial report, which has been
prepared in accordance with Australian Accounting Standards, other authoritative
pronouncements of the Australian Accounting Standards Board, Urgent Issues Group
Consensus Views and the Corporations Act 2001.  The financial report covers the
economic entity of Orchid Capital Limited and controlled entities and Orchid
Capital Limited as an individual parent entity.  Orchid Capital Limited is a
listed public company, incorporated and domiciled in Australia.

The financial report has been prepared on an accruals basis and in accordance
with the historical cost convention and does not take into account changing
money values or, except where stated, current valuations of non-current assets.
Cost is based on the fair values of the consideration given in exchange for

The following is a summary of the material accounting policies adopted by the
economic entity in the preparation of the financial report.  Unless otherwise
stated, the accounting policies adopted are consistent with those of the
previous year.

Significant Accounting Policies

Accounting policies are selected and applied in a manner that ensures that the
resultant financial information satisfies the concepts of relevance and
reliability, thereby ensuring that the substance of the underlying transactions
and other events is reported.  Comparative information is reclassified where
appropriate to enhance comparability.

In addition to the accounting policies prescribed by applicable Accounting
Standards, the following significant accounting policies have been adopted in
the preparation and presentation of the financial report:

(a)  Recoverable Amount of Non-Current Assets

     Non-current assets are not revalued to an amount above their recoverable 
     amount, and where carrying values exceed this recoverable amount assets are
     written down.  In determining such recoverable amounts, the expected net 
     cash flows have not been discounted to their present value.

(b)  Depreciation

     Depreciation is provided on property, plant and equipment, excluding land 
     and investment properties.  Depreciation is calculated on a straight-line
     basis so as to write off the net cost of each asset over its expected 
     useful life.  Leasehold improvements are depreciated over the period of the
     lease or estimated useful life, whichever is the shorter, using the 
     straight-line method.

     The expected useful lives are as follows:

          Fixtures and fitting                3 years
          Computer equipment                  3 years

(c)  Income Tax

     Tax-effect accounting is applied using the liability method whereby income 
     tax expense or benefit is calculated on the accounting profit or loss from 
     ordinary activities after allowing for permanent differences.  To the 
     extent time differences occur between the time items are recognised in the
     accounts and when items are taken into account in determining taxable 
     income, the net related taxation benefit or liability, calculated at 
     current rates, is disclosed as a future income tax benefit or a provision 
     for deferred income tax.  The net future income tax benefit relating to tax
     losses and timing differences is not carried forward as an asset unless the
     benefit is virtually certain of being realised.

(d)  Investments

     Interests in listed and unlisted securities and debt instruments, other 
     than controlled entities and associates in the consolidated financial
     statements, are brought to account at the lower of cost and net realisable 
     value and dividend income is recognised in the statement of financial 
     performance when receivable.  Controlled entities and associates are 
     accounted for in the consolidated financial statements as set out in 
     Note 1(i).

     The debt instruments are carried at fair value.

(e)  Derivative Instruments

     All derivative instruments are carried at fair value on the Statement of 
     Financial Position and are reported as 'positive' or 'negative' replacement
     values.  Fair values are obtained from quoted market prices and dealer 
     price quotations.  Realised or unrealised gains or losses are recognised
     in 'net results from derivative instruments'.

(f)  Cash

     For the purposes of the statement of cash flows, cash includes cash on hand
     and in banks, and money market investments readily convertible to cash 
     within two working days, net of outstanding bank overdrafts.

(g)  Capital Gains Tax

     No provision has been made for capital gains tax which may arise in the 
     event of sale of revalued assets as no decision has been made to sell any 
     of these assets.

(h)  Employee Entitlements

     (i)  Annual Leave

          Provision is made for the annual leave liability owed to employees at 
          balance date. Employee benefits expected to settle within one year 
          have been measured at the amounts expected to be paid when the 
          liability is settled, plus related on-costs.

     (ii) Long Service Leave

          A liability for long service leave is recognised, and is measured as 
          the present value of expected future payments to be made in respect of
          services provided by employees up to the reporting date.  
          Consideration is given to expected future wage and salary levels, 
          experience of employee departures and periods of service.  Expected 
          future payments are discounted using interest rates on national 
          government guaranteed securities with terms to maturity that match, as
          closely as possible, the estimated future cash outflows.

     (iii)Share and Options on remuneration

          The value of shares and options granted to directors, employees and 
          contractors as part of remuneration for past or future services is
          accounted for in the statement of financial performance as an expense.
          The value of shares issued is taken as the market value of the shares 
          at date of approval by shareholders (in the case of directors) or the 
          date of issue for employees and contractors.  The options are valued 
          using the Black Scholes Option Value Methodology and the proportion of
          the value from date of grant to balance date is expensed and the 
          remaining value of the options granted are taken up as an expense over
          the vesting period.

(i)  Principles of Consolidation

     The consolidated financial statements incorporate the assets and 
     liabilities of all entities controlled by Orchid Capital Limited ('company'
     or 'parent entity') as at 30 June 2005 and the results of all controlled 
     entities of the year then ended.  Orchid Capital Limited and its controlled
     entities together are referred to in this financial report as the
     consolidated entity. The effects of all transactions between entities in 
     the consolidated entity are eliminated in full.  Outside equity interests 
     in the results and equity of controlled entities are shown separately in 
     the consolidated statement of financial performance and statement of 
     financial position respectively.

     Where control of an entity is obtained during a financial year, its results
     are included in the consolidated statement of financial position from the 
     date on which control commences.  Where control of an entity ceases during 
     a financial year its results are included for that part of the year during 
     which control existed.

     Investments in associates are accounted for in the consolidated financial 
     statements using the equity method.  Under this method, the consolidated 
     entity's share of the profits or losses of associates is recognised as 
     revenue in the Consolidated Statement of Financial Performance, and its 
     share of movements in reserves is recognised in consolidated reserves.  
     Associates are those entities over which the consolidated entity exercises 
     significant influence, but not control.

(j)  Leased Non-Current Assets

     A distinction is made between finance leases which effectively transfer 
     from the lessor to the lessee substantially all the risks and benefits
     incidental to ownership of leased non-current assets, and operating leases 
     under which the lessor effectively retains substantially all such risks and
     benefits. Finance leases are capitalised.  A lease asset and liability are 
     established at the present value of minimum lease payments.  Lease payments
     are allocated between the principal component of the lease liability and 
     the interest expense. The lease asset is amortised on a straight-line basis
     over the term of the lease, or, where it is likely that the consolidated 
     entity will obtain ownership of the asset, the life of the asset.

     Other operating lease payments are charged to the Statement of Financial 
     Performance in the periods in which they are incurred, as this represents 
     the pattern of benefits derived from the leased assets.

(k)  Foreign Currency

     All foreign currency transactions during the financial year are brought to 
     account using the exchange rate in effect at the date of transaction.
     Foreign currency monetary items at reporting date are translated at the
     exchange rate existing at that date.

     Exchange differences are recognised in the statement of financial
     performance in the period in which they arise except that:

     i.   exchange differences which relate to assets under construction for
          future productive use are included in the cost of those assets; and

     ii.  exchange differences on transactions entered into in order to hedge
          the purchase or sale of specific goods and services are deferred and 
          included in the measurement of the purchase or sale.

     Exchange differences relating to foreign currency monetary items forming 
     part of the net investment in a self-sustaining foreign operation are 
     transferred on consolidation to the foreign currency translation reserve.

     Financial statements of self-sustaining foreign controlled entities are
     translated at reporting date using the current rate method and exchange
     differences are taken directly to the foreign currency translation reserve.

(l)  Mineral exploration and evaluation costs

     The Company has the policy to expense all mineral exploration and 
     evaluation costs to the Statement of Financial Performance.

                                                     Consolidated         Parent Entity
                                                 2005         2004         2005         2004
                                                  $            $             $            $

2.      REVENUE

         Interest income                          287,394      262,364        46,228     106,575
         Proceeds on disposal of investments   13,338,567    4,956,120        68,043      29,670
         Net results from derivative              196,148       87,180             -           -
         Sundry income                              1,290            -         1,290           -
                                               13,823,398    5,305,664       115,561     136,245

                                                       Consolidated         Parent Entity
                                                   2005         2004         2005         2004
                                                    $            $             $            $

         Loss from ordinary activities before
         income tax has been determined after:

         Depreciation of plant and equipment       (16,855)     (10,435)      (16,855)    (10,435)
         Employee benefit expenses                (366,717)    (420,651)     (366,717)   (420,651)
         Provision for write down of              (229,696)     (93,220)      (56,670)   (870,669)
         Share of net losses of associates                -    (589,023)             -           -
         Write-off of property, plant and                 -        (550)             -       (550)
         Exploration and evaluation costs                      (354,499)                         -
         written off
         Options issued to directors                      -     (71,700)             -    (71,700)
         Options issued to consultant                     -     (14,340)             -    (14,340)
         Net gain on disposal of investments        707,553      129,910        18,387       9,670
         Net exchange (loss)/gain                         -      (8,878)             -           -
         Net results from derivative                196,148       87,180             -           -

4.      INCOME TAX

         Prima facie tax on operating loss      (1,237,678)    (465,407)   (1,315,221)   (501,777)
         before income tax at 30%
         Tax effect of permanent differences      1,300,563       39,118     1,098,198     167,066
         Carried forward tax losses             (1,156,408)            -     (949,524)           -
         Future income tax benefit not brought    1,156,408      234,923     1,166.547     214,764
         to account
         Income tax attributable to operating             -            -             -           -

The Directors have considered it prudent not to bring to account the future
income tax benefit of income tax losses and exploration deductions until there
is virtual certainty of deriving assessable income of a nature and amount to
enable such benefit to be realised.

The Company has estimated income losses and capital losses of $9,459,596 and
$5,087,100 respectively (2004: $9,141,000 and $414,000 respectively).  The
benefit of these losses and timing differences will only be obtained if:

(a)  the economic entity derives future assessable income of a nature and an 
     amount sufficient to enable the benefit from the deductions for the loss to
     be realised;

(b)  the economic entity continues to comply with the condition of
     deductibility imposed by law; and

(c)  no changes in tax legislation adversely affect the economic entity in
     realising the benefit from the deduction for the loss.

                                                         Consolidated                     Parent Entity
                                                     2005             2004             2005            2004
                                         Note         $                $                $               $

         Sundry debtors                                 22,736            5,536          24,142           5,515
         Interest receivable from debt                  22,375           29,084               -               -
         Loan to an associate             7(g)                                -                               -
                                                        45,111           34,620          24,142           5,515

          Non-Current Receivable                         4,337                -           4,337               -
         Loan receivable from a                              -                -               -         354,499

Loan provided to Orchid Resources Limited was unsecured, interest free and has
no fixed term of repayment.  The loan was used to fund the exploration and
evaluation activities in Tibet.                                                 

                                                         Consolidated                     Parent Entity
                                                     2005             2004             2005            2004
                                         Note         $                $                $               $

         Investments in debt instruments             2,808,125        3,713,525               -               -
         Investments in equities                       352,846          411,981               -               -
                                                     3,160,971        4,125,506               -               -

                       Country of          Percentage Interest Held       Cost of Parent Entity's
                      Incorporation                                              Investment
                                             2005            2004             2005             2004
                                              $               $                 $               $

(i) Investment in
controlled entities

Orchid Emarb               BVI                   100%            100%          4,261,460      4,261,460
Ltd (Note 7 (a))

Orchid Thailand         Thailand                 100%            100%             89,048         89,048
Ltd (Note 7(b))

Less: Provision                                                                 (31,048)       (21,718)
for write down
                                                                                  58,000         67,330
Orchid Resources        Mauritius                100%            100%                  -              -
Limited (Note 7(c))
                                                                               4,319,460      4,328,791

Investment in
unlisted associated

Asia Island             Thailand               23.81%          23.81%          3,072,606      3,072,606
Homes Ltd (Note 7(d))

Less: Provision                                                              (3,072,606)    (3,020,288)
for write down
                                                                                       -         52,318

Jiva Kata Resort     British Virgin             23.2%           23.2%          1,343,763      1,343,763
Company Ltd             Islands
(Note 7(e))

Less: Provision                                                                (788,763)      (639,115)
for write down
                                                                                 555,000        704,648

                                                                                 555.000        756,966

Investment in
unlisted entities

Advent Television                                                                595,581        595,581
Ltd (Note 7(f))

Less: Provision                                                                (575,582)      (575,250)
for write down
                                                                                  20,000         20,331

                                                                                  20,000         20,331

Investment held for

Pangala Holdings           BVI                   100%               -            274,151        274,151
Limited (Note 7(g))

Investment in
listed entities

Golden Cross            Australia                                                 32,120         50,188
Resources Ltd
(Note 7(h))

Tritton Resources       Australia                                                      -         20,000
Ltd (Note 7(i))

Cangold Ltd (Note 7(j))  Canada                                                   54,921         54,921

Arc Energy NL           Australia                                                      -         29,750
(Note 7(k))

                                                                                  87,041        154,859

Total                                                                          5,008,642      5,535,098

Parent     Parent

         Total Investment - Parent                                             5,008,642      5,535,098

         Investment - Subsidiaries                                                          (4,328,791)
         Reversal of provision                                                                  589,023
         for write down in associates
         Share of net losses of                                                               (589,023)
         TOTAL INVESTMENTS - Consolidated                                   936,192           1,206,307

(a)     Orchid Emarb Limited

        Orchid Emarb Limited ('OEL'), a company incorporated in the British Virgin Islands and is a wholly owned
subsidiary of Orchid Capital Limited.  It is an investment company and seeks maximum capital appreciation and financial
returns by channelling its funds to prospective debt financial instruments, equities and financial derivatives.  At 30
June 2005, the majority of its portfolio resides in Europe.

(b)     Orchid Thailand Limited ('OTL'), a company incorporated in Thailand and is a wholly owned subsidiary of Orchid
Capital Limited.  It is an investment holding company seeking opportunities in investing in high growth companies in
Thailand.  The company remains dormant since the incorporation.

        The Directors considered the fair value of the investment at 30 June 2005 to be $58,000 and as a consequence a
write down of $9,330 was made and charged to the Statement of Financial Performance for the financial year under review.

(c)     Orchid Resources Limited ('ORL'), a company incorporated in Mauritius and is a wholly owned subsidiary of Orchid
Capital Limited.  ORL was created with an immediate focus on the People's Republic of China.

(d)     Asia Island Homes Inc / Asia Island Homes Limited

In September 2001, a 16% interest in Asia Island Homes Inc ('AIH'), a company registered in the British Virgin Islands,
was acquired at a cost of $2,822,581.  AIH is the holding company for a group of companies engaged in real estate
development and housing construction in Phuket, Thailand.  An additional investment of $250,000 was made in April 2002
to increase its holding to 23.81%.  However, in line with the management's divestment plans, a new company was set up
namely Asia Island Homes Limited ('AIHL'), a company incorporated in Thailand.  Assets and liabilities of AIH were
effectively transferred to AIHL on 11 September 2002 and new shares issue in proportion to the existing shareholders of
AIH, all of which was completed on 11 September 2002.

        The Directors considered the fair value of the investment at 30 June 2005 to be nil (2004, $52,318) and as a
consequence the balance of the investment was fully provided for with a further write down of $52,318 (2004 $365,856)
charged to the Statement of Financial Performance for the financial year under review.

(e)     Jiva Kata Resort Company Limited

The Company holds a 23.2% interest in Jiva Kata Resort Company Ltd, a company registered in the Thailand.  The directors
have considered the fair value of the investment at 30 June 2005 to be $555,000 (2004 $704,648) and as a consequence a
write down of $149,648 (2004, $99,824) was made and charged to the Statement of Financial Performance for the financial
year under review.   Under equity accounting, a share of loss amounting to $201,966 (2004 a loss of $223,167) was
reported in the consolidated accounts for this associate for the year ended 30 June 2005.

(f)     Advent Television Limited

The Company has invested in Advent Television Limited, a company incorporated in Singapore.  The directors have
considered the fair value of the investment at 30 June 2005 to be $20,000 (2004, $20,331) and as a consequence a write
down of $331 (2004, $76,245) was made and charged to the Statement of Financial Performance for the financial year under
review.  The Company also holds 3,500,000 options in Advent Television Ltd, exercisable at S$0.50 each, and in the case
of an IPO, 20% below the IPO price. Advent's management plans an IPO within 2005.

(g)     Pangala Holdings Limited

        Pangala Holdings Limited ('PHL') a company incorporated in the British Virgin Islands and is a wholly owned
subsidiary of Orchid Capital Limited.  PHL has been set up to hold the land at Lot 12 at Samsara, which was pledged by
the associate - Asia Island Homes Inc. ('AIH') as collateral for a loan granted to them in 2002/2003.  During the
previous financial year, the Company exercised its right over the land after AIH's failure to repay the full loan amount
and interest totalling $240,000 and $34,151 respectively.  As such, an amount of $274,151 was reclassified from
receivable to investment.  It is the intention to sell PHL to a third party and it is its opinion that the amount
recoverable from the sale of the land is expected to be higher than the amount owed.  Considering the nature of the
holding, the investment has been treated as investment held for resale and thus no consolidation is performed to
incorporate the company's financial position and state of affairs into the Consolidated Financial Statements.

(h)     Golden Cross Resources Limited

        The Company holds 1,003,751 shares in Golden Cross Resources Ltd. A further provision of $18,068 for the
diminution in value was made during the year to report the investment at market value at balance date.

(i)     Cangold Ltd

        The Company holds 500,000 shares in Cangold Ltd at 30 June 2005.  No provision for write off was made as the
market value at the balance date greater than the cost of investment.


                                                   Consolidated and               Consolidated and
                                                     Parent Entity                  Parent Entity
                                                         2005                           2004
                                                           %                              %

Fixtures, fittings and computers - at                   86,684                             76,632
Accumulated depreciation                               (38,344)                          (37,420)
                                                        48,340                             39,212


                                                    Fixtures, Fittings and
Parent and Consolidated Entity

Balance at the beginning of the year                                 39,212
Additions                                                            26,077
Write off                                                              (94)
Depreciation                                                       (16,855)
Carrying amount at end of year                                       48,340

                                                      Consolidated                     Parent Entity
                                                 2005             2004             2005             2004
                                                   $                $                $                $


          All mineral exploration and                    -                -                -                -
          evaluation expenditure is written
          off as incurred.

                                                      Consolidated                     Parent Entity
                                                 2005             2004             2005             2004

                                                   $                $                $                $

          Trade creditors and accruals             157,487           48,075          148,094           33,238


          Employee entitlements (Current)           55,053           23,628           55,053           23,628
          Employee entitlements (Non                38,333           23,565           38,333           23,565
                                                    93,386           47,193           93,386           47,193

                                                        No              No.               No              No.
Number of employees at year end                          5                5                4                4

                                                                 Number of           Issue            Total
                                                                  Shares                                $

Balance as at 30 June 2004                                        143,370,296                        28,846,935
Option conversions                                                 21,190,417          5 cents        1,059,521
Option premium transferred to share capital
upon conversion of options

                                                                            -                           105,951
Issue of shares                                                    10,000,000         16 cents        1,600,000
Capital raising costs                                                       -                -                -
Balance as at 30 June 2005                                        174,560,713                        31,612,407

                                                               Number of        Issue Price          Total

          Exercisable at 5 cents on or before 30
          November 2006
          Balance as at 30 June 2004                            117,445,938                             595,630
          Exercised during the year                            (21,190,417)                         (1,059,521)
          Issued during the year (free attaching to                                                           -
          shares issues during the year)
          Issued to consultant with no consideration (as          3,000,000            0.025             75,000
          part of his remuneration)
          Balance as at 30 June 2005                             99,255,521                           (388,891)


       Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
       Company in proportion to the number of and amounts paid on the share issues.  On a show of hands
       every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote,
       and upon a poll each share is entitled to one vote.

                                                       Consolidated                      Parent Entity
                                                  2005              2004             2005            2004
                                                   $                 $                $                $

       Option premium reserve (Refer note 12      564,678             595,630         564,678          595,630
       Foreign currency translation reserve      (422,620)            132,485               -                -
       Balance at end of year                     142,058             728,115         564,678          595,630

       Balance as at beginning of the year       21,528,889        19,977,532                       20,433,944

       Net loss for year                          4,125,594         1,551,357       4,384,072        1,672,591
       Balance as at end of year                 25,681,483        21,528,889      26,490,607       22,106,535

15.    EARNINGS PER SHARE                                                         151,768,454      138,212,504

Weighted average number of ordinary shares
used in calculation of basic earnings per

(a)    Reconciliation of net cash used in
       operating activities to operating
       loss after income tax
       Operating (loss) after tax                 (4,125,594)     (1,551,357)     (4,384,072)      (1,672,591)
       Depreciation of property, plant and             16,855          10,435          16,855           10,435
       Write-off of property, plant and                    94             550              94              550
       Net gain on sale of investments              (288,715)       (129,910)        (18,293)          (9,670)
       Net results form derivative                  (196,148)        (87,180)               -                -
       Share in associated company net                201,966         589,023               -                -
       Provision for write down of                     56,670          93,220         229,696          870,669
       Write off of unrecoverable investment                -               -       3,165,080                -
       & loan
       Exploration and evaluation costs             3,500,194         354,499               -                -
       written off
       Employee/director option remuneration           75,000          86,040          75,000           86,040
       Foreign exchange translation effects          (78,462)               6               -                -
       Changes in net assets and liabilities
       (Increase) in Receivables                     (14,828)        (35,161)        (22,964)         (11,850)
       Decrease / (Increase)in Prepayments                  -          12,393               -           12,375
       Increase / (Decrease) in Payables              116,129           8,454         114,857            4,596
       Increase / (Decrease) in Provisions             46,193          40,106          46,193          (1,269)
                                                    (690,646)       (608,882)       (777,554)        (669,340)

(b)    Reconciliation of cash
       Cash at bank and on hand                     2,162,621       2,774,618         595,489        1,482,137
                                                    2,162,621       2,774,618         595.489        1,482,137


                                        Primary            Post Employment        Equity     Other      Total

                                  Salary &     Non    Superannuation Retirement  Options     Other
                                    Fees    Monetary                  Benefits              Benefits
                                     $          $             $          $          $          $           $
Specified Directors
       R Kestel  Non Executive
                             2005    31,354         -              -          -          -          -    31,354
                             2004    25,000         -              -          -     14,340          -    39,340

       A Tan  Managing Director
                             2005   147,822         -         14,250          -          -          -   162,072
                             2004   130,000         -         11,700          -     14,340          -   156,040

       N Grafton  Finance
       Director and Company
                             2005   110,696         -         34,000          -          -          -   144,696
                             2004    93,500         -          8,415          -     14,340          -   116,255

       C McKee Executive Director
                             2005   141,552         -              -          -          -          -   141,552
                             2004   140,725         -            975          -     14,340          -   156,040
       J Sandt Non Executive
                             2005    31,709         -              -          -          -          -    31,709
                             2004    25,000         -              -          -     14,340          -    39,340

Total Remuneration - Specified
       2005                         463,133         -         48,250          -          -          -   511,383
       2004 (1)                     414,225         -         21,090          -     71,700          -   507,015

(1)    The 2003/04 remuneration includes a total of $14,340 per director
in relation to a total of 5,000,000 share options issued to directors in
November 2003 (1,000,000 each).  The value of such options for the period to 30
June 2004 was been booked in the statement of financial performance.  The
options are exercisable at 5 cents each and were granted on 26 November 2003 and
expire 30 November 2006.  The total value of the options issued to the directors
is $71,700 using the Black Scholes Methodology.


      Shares and Options Held at                Fully Paid Shares      30 November 2006
      30 June 2005

      R Kestel                                          -                  250,000
      N Grafton                                         -                 1,000,000
      C McKee                                            1,250,000        1,250,000      *
      J Sandt                                              100,000        1,000,000
      A Tan                                                460,000        1,000,000

•     250,000 are listed, exercisable at 5 cents on or before 30 November
2006 and were issued in a prior year.  1,000,000 30 November 2006 options were
issued to each of the directors in late November 2003 (refer note 17).  Further
details on the value of the options issued to directors as remuneration in
November 2003 are outlined in Note 17.  There were no movements in the
shareholdings of the directors from 1 July 2004 to 30 June 2005 apart from the
sale of 750,000 options by Mr Kestel.

                                                    Consolidated                       Parent Entity
                                               2005              2004              2005             2004
                                                $                  $                 $                $

       Amounts received or due and
       receivable by the auditors of the

       Auditing accounts                           34,592            20,000           27,297           20,000
       Other services                               1,000             5,603            1,000            5,603
                                                   35,592            25,603           28,297           25,603

       The other services were in relation to the provision of taxation services (including tax preparation
       and general tax advice) and corporate governance issues.

       Remuneration of other auditors of            4,505             3,300                                 -
       controlled entities for the audit
       or review of the financial reports
       of any entity in the consolidated


       There were no outstanding commitments, which are not disclosed in the financial statements of the economic
       entity and the Company as at 30 June 2005.  The economic and parent entities have the following
       outstanding commitments:-

       Commitments on the Co-operative Joint Venture

(a)    As the Co-operative Joint Venture contract between China Tibet Institute of Geology Survey ('CTIGS') and
       Orchid Resources Limited ('ORL') of June 2004, is now in process of being terminated, ORL has no further
       spending obligations.

(b)    Remuneration Commitments

       The Company has the following remuneration commitments payable to directors and executives, which have not
       been recognised as a liability in the financial statements as at 30 June 2005:

                                                     Consolidated                         Parent Entity
                                               2005                2004               2005              2004
                                                 $                  $                  $                 $

        Due within 1 year                        455,416              688,850           455,416           388,850
        Due 1 to 5 years                           130,000          1,404,121           130,000           444,450
        Due after 5 years                             -               360,000                 -                 -
                                                   585,416          2,452,971         585,416             833,300

(c)     Operating Lease Commitments
                                                    Consolidated &       Consolidated &
                                                     Parent Entity        Parent Entity

                                                         2005                 2004

                                                           $                    $
        Non-cancellable operating lease contracted
        for but not recognised in the financial
        Due within 1 year                                     26,020               27,747
        Due 1 to 5 years                                      26,020                    -
        Due after 5 years                                     23,852                    -
                                                              75,892               27,747


(a)     The Directors of the Company during the financial year and prior year were:
        R Kestel

        N Grafton
        C McKee
        J Sandt
        A Tan

(b)     The following related party transaction occurred during the financial year and previous
        financial year:
        On 30 June 2004, Mr N Grafton entered into a new 3 year employment contract with the Company.
        The current annual remuneration is $130,000 exclusive of statutory superannuation.


                                                         Fixed Interest Rate Maturing

         2005                  Notes   Weighted    Floating       1 year or      Over 1-5          Non
                                        Average    Interest         less           years        interest
                                       Interest      Rate                                        bearing
                                         Rate                                                                   Total
                                                      $               $              $              $             $

         Financial Assets
         Cash                    16(b)    1.08             -        450,000              -      1,712,621      2,162,621
         Receivables               5         -             -              -              -         49,448         49,448
         Other financial assets    6      6.23             -      2,808,125              -        352,846      3,160,971
         Investments               7         -             -              -              -        936,192        936,192
         Total Financial Assets                            -      3,258,125              -      3,046,770      6,304,895

         Financial Liabilities                             -              -              -
         Payables                  10        -             -              -              -        157,487        157,487
         Provisions                11        -             -              -              -         93,386         93,386
         Other financial                     -             -              -              -          6,718          6,718
         Total Financial
                                                           -              -              -        250,873        250,873

         Net Financial Assets                              -      3,258,125              -      2,795,897      6,054,022

Reconciliation of Net Financial Assets/(Liabilities) to Net Assets

                                                        2005                              2004

                                                         $                                  $
Net Financial Assets/(Liabilities)                       6,051,642                           8,006,949
Property Plant and Equipment                                48,340                              39,212
Prepaid Expenses                                                 -                                   -
Net Assets                                               6,099,982                           8,046,161

(a)    Credit Risk

       The maximum exposure to credit risk, excluding the value of any collateral or other security, net of
       any provisions for doubtful debts of those assets, as disclosed in the Statement of Financial
       Position and notes to the financial statements.

       The economic entity does not have any material credit risk exposure to any single debtor or group of
       debtors under financial instruments entered into by the economic entity.

(b)    Net Fair Values

       The net fair values of listed investments have been valued at the quoted market bid price at balance
       date, adjusted for any transaction costs expected to be incurred.

       For unlisted investments where there is no organised financial market the net fair value has been
       based on a reasonable estimation of the underlying net assets or discounted cash flows of the
       investment.  Note 7 provides details of these investments.

(c)    Derivative Financial Investments

       Orchid Capital Limited and certain of its controlled entities are parties to derivative financial
       instruments with the objective of benefiting from the fluctuations in foreign exchange rates.

                                 Australia          Asia          Europe      Eliminations    Consolidated
Geographical segments            2005     2004    2005   2004    2005   2004    2005    2004    2005    2004
                                 $000     $000    $000   $000    $000   $000    $000    $000    $000    $000
External sales                    115      136       -      1  13,708  5,169       -       -  13,823   5,306
Inter-segment sales                          -              -              -       -       -       -       -
Total sales revenue               115      136       -      1  13,708  5,169       -       -  13,823   5,306
Share of net profit or              -        - (3,705)  (589)       -      -       -       - (3,705)   (589)
(loss) result of associates
Total segment revenue             115      136 (3,705)  (588) 13,708   5,169       -       -  10,118   4,717
Segment Result                (1,007)  (1,188) (3,705)  (996)     587    633       -       - (4,126) (1,551)
Unallocated corporate                                                                              -       -
Profit or (Loss) from                                                                        (4,126) (1,551)
ordinary activities before
income tax expense
Income tax expense                                                                                 -       -
                                                                                             (4,126) (1,551)
Extraordinary items after                                                                          -       -
income tax expense
Net profit/(Loss)                                                                            (4,126) (1,551)

For the year ended 30 June 2005, the results related to investment operations,
except for $3,500,194 relating to mineral exploration in Tibet.

                                 Australia        Asia          Europe       Eliminations    Consolidated
                                 2005    2004   2005   2004    2005    2004    2005    2004     2005   2004
                                 $000    $000   $000   $000    $000    $000    $000    $000     $000   $000

Segment assets                  5,928   7,416     70     77   5,561   5,442 (5,201) (4,755)    6,358  8,180
Unallocated corporate assets                                                                       -      -
Consolidated total assets                                                                      6,358  8,180

Segment liabilities               203      80     12     11       4      43       -       -      219    134
Unallocated corporate                                                                              -      -
Consolidated total                                                                               219    134
Investments accounted for                                                                    (3,705)  (589)
using the equity method -
Profit/(Loss) - Asia
Acquisitions of property,                                                                         26     32
plant and equipment and
intangible assets
Depreciation and amortisation                                                                     17     10
of segment assets
Other non cash segment                                                                            31    179


          The Company has entered into an agreement with each of its directors, whereby the company agreed to
indemnify the officers against any liability to any person except liability arising out of conduct involving a lack of
good faith on the part of the officer.

          In the event that any share options issued at 5 cents per share are not exercised by 30 November 2006, the
option premium relating to the unexercised options is considered to be a capital gain for tax purposes.  At 30 June
2005, the option premium relating to unexercised share options totals $564,678. (2004: $509,643)


There has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, in the opinions of the directors of the Company, to
affect significantly the operations of the Company, the results of those operations, or the state of affairs in the
Company in future financial years.


The financial statements of Orchid Capital Limited have been prepared on the
basis as set out in Note 1 to the financial statements.

The accounting policies of the Company and financial reporting are, except as
disclosed below, in all material respects substantially the same as that which
would be applicable had the Company adopted IFRS.

The figures disclosed are management's best estimate of the quantitative impact
of the changes as at 30 June 2005 and for the year ended 30 June 2005.

(a)       Reconciliation of equity as presented under Australian Generally Accepted Accounting Principles 
          ('AGAAP') to IFRS
                                                   Consolidated                       Parent Entity
                                          30 June         30 June              30 June         30 June
                                            2005             2004                2005             2004
                              Note           $                  $                 $                 $

Total equity under AGAAP                  6,099,982          8,046,161         5,686,480           7,336,030

Adjustments to accumulated
Effect of mark-to-market
investments held for
trading                        (i)          263,986             71,710                 -                   -

Adjustments to net gains on
financial assets
Effect of mark-to-market
investments available for
sale                          (ii)                -             49,911                 -              49,911

Total equity under IFRS                   6,363,968          8,167,782         5,686,480           7,385,941

(b)        Reconciliation of net loss under AGAAP to that under IFRS

                                                   Consolidated                       Parent Entity
                              Note         2005               2004               2005               2004
                                             $                  $                 $                  $
Net loss as reported under
AGAAP                                     (4,125,594)        (1,551,357)       (4,384,072)         (1,672,591)

Effect of mark-to-market
investments held for
trading                        (i)            192,276             71,710                 -                   -

Total equity under IFRS                   (3,933,318)        (1,479,647)       (4,384,072)         (1,672,591)

(c)        Reconciliation of net gains on available-for-sale financial assets reserve under AGAAP to that
           under IFRS

                                                   Consolidated                       Parent Entity
                                          30 June         30 June              30 June         30 June
                                            2005             2004                2005             2004
                              Note           $                  $                 $                 $

Reserve as reported under
AGAAP                                               -                  -                 -                   -

Effect of mark-to-market
investments available for
sale                          (ii)                  -             49,911                 -              49,911

Total equity under IFRS                             -             49,911                 -              49,911

(i)       Under AASB 139, financial assets that held for trading are measured
          at fair value through the Statement of Financial Performance.

(ii)      Under AASB 139, financial assets that are available for sale are
          measured at fair value with changes in fair value measured directly to equity
          (net gains on available-for-sale financial assets reserve).


The Directors of the Company declare that:

1.   the financial statements and notes, as set out on pages 14 to 37 are
     in accordance with the Corporations Act 2001:

     (a)  comply with Accounting Standards, the Corporations Regulations 2001; and

     (b)  give a true and fair view of the financial position as at 30 June
          2005 and of the performance for the year ended on that date as of the company
          and economic entity;

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

Director                             Alvin Tan

Dated at Perth this 13 day of September 2005


This report is based on accounts which are in the process of being audited.


Additional information required by Australian Stock Exchange Limited and not
shown elsewhere in this Annual Report is as follows. The information is made up
to 8 September 2005.


                                           Fully Paid                     Options
                                             Shares                  30 November 2006
1- 1,000                                       58                            3
1,001 - 5,000                                  95                            9
5,001 -  10,000                                108                          16
10,001 - 100,000                               242                          69
100,001 and over                               65                           61
                                               568                          158


There are 262 fully paid ordinary shareholders who hold less than a marketable
parcel of shares.

Voting Rights

On a show of hands, every member present in person or by proxy shall have one
vote and, upon a poll, each share shall have one vote.


 Fully Paid                           Shareholders                              Number           Percentage

                ANZ Nominees Ltd                                                108,085,333             61.918
                McNeil Nominees Pty Ltd                                           7,645,994              4.380
                National Nominees Ltd                                             6,484,423              3.715
                LC Asia Limited                                                   5,000,000              2.864
                Merrill Lynch (Australia) Nominees Pty Ltd                        4,285,054              2.455
                Straight Investments SA                                           2,718,857              1.558
                Asialink Holdings Ltd                                             2,413,569              1.383
                Mr Pat Volpe                                                      2,200,000              1.260
                Tao Yuan Limited                                                  2,000,000              1.146
                Dr David S Tyrwhitt                                               2,000,000              1.146
                IFTC Broking Services Ltd                                         1,250,000              0.716
                Walpett Engineering Pty Ltd                                       1,140,000              0.653
                Cheung Shun Resources Limited                                     1,000,000              0.573
                Innovation Marketing & Finance Pty Ltd                              928,496              0.532
                Asterbell Pty Ltd                                                   838,875              0.481
                Mr Johnnie Fullford                                                 820,000              0.470
                Mr Maxwell Deason & Mrs Gillian Deason                              750,000              0.430
                Mr Bruce R Pettit                                                   700,000              0.401
                Trayburn Pty Ltd                                                    700,000              0.401
                Westpac Custodian Nominees Limited                                  676,162              0.387

30 November 2006
   Listed                            Shareholders                              Number            Percentage

                McNeil Nominees Pty Ltd                                         33,971,428              34.226
                Mr Ang Tong Shing                                                6,000,000               6.045
                Ms Bee Hun Thean                                                 6,000,000               6.045
                Innovation Marketing & Finance Pty Ltd                           5,614,209               5.656
                ANZ Nominees Ltd                                                 5,248,655               5.288
                International Mining Finance Pty Ltd                             4,331,264               4.364
                Essential Consulting &Business Services Pty Ltd                  3,000,000               3.023
                Mr Paul Hartley Watts                                            2,550,000               2.569
                Colvic Pty Ltd                                                   2,524,503               2.543
                Asterbell Pty Ltd                                                2,255,286               2.272
                Mr & Mrs Michael Lim                                             2,000,000               2.015
                Gilventures Pty Ltd                                              1,310,000               1.320
                ITFC Broking Services Ltd                                        1,250,000               1.259
                Tao Yuan Limited                                                 1,000,000               1.008
                Clive McKee                                                      1,000,000               1.008
                Ostle Investments Pty Ltd                                        1,000,000               1.008
                Julian Sandt                                                     1,000,000               1.008
                Norman Grafton                                                   1,000,000               1.008
                Temtor Pty Ltd                                                   1,000,000               1.008
                Mr & Mrs Barry Headland                                            800,000               0.806


There are no shareholders recorded in the Register of Substantial Shareholders.

                      This information is provided by RNS
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