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## 1.3 Selected Annual Financial Information 

For the year ended June 30, 2011 

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## 1.4 Results of Operations 

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## Summary 

The operating results of the Company reflect its income from operations, on-going corporate business development, administrative costs and other income or expenses such as interest, accretion expense, fair value gains or losses on derivative liabilities and foreign exchange gains or losses. 

For the year ended June 30, 2011, commercial production from the Selinsing Gold Project generated an income of $35,374,349 net of operating and corporate expenses, or $0.21 per share, which was increased by a change in fair value on a gold forward contract of $1,602,306 and interest income of $104,946 and offset by other losses mainly due to changes in fair value on derivative liabilities of $4,759,797 estimated using Black-Scholes financial mode and indicated foreign exchange forward contract spot rates; and accretion expense of $1,145,509 all of which resulted in a net income of $31,252,160, or $0.19 per share, compared to a net loss of $3,034,838, or ($0.02) per share, reported for the corresponding period in fiscal 2010. 

## Sales, Cost of Goods Sold and Gross Margin from Mining Operations 

Revenue from the sale of metals is recognized in the financial statements when the following conditions are met: persuasive evidence of an arrangement exists; title and risk passes to buyer, the price is fixed or determinable; and 

