Management’s Discussion and Analysis of Financial Condition and  Results of Operations Overview On November 21, 2001 AXMIN Inc. (the “Company”) (formerly Asquith Resources Inc.) success- fully completed the reverse take- over of AXMIN Limited (“AXMIN”) by the acquisition of all of the  outstanding shares of AXMIN in exchange for the issuance to the AXMIN shareholders of 34,506,532 common shares of the Company (the “RTO Transaction”). Concurrent with the completion of the RTO Transaction the Company closed the issue and sale of 14,627,000 common shares of the Company at a price of Cdn$0.25 per common share for total gross proceeds of Cdn$3,656,750 (the “Offering”). The RTO Transaction resulted in the former shareholders of AXMIN owning the majority of the issued and outstanding common shares of the Company. Under the purchase method of accounting AXMIN has been identified as  the acquirer and, accordingly,  the entity is considered to be a continuation of AXMIN with the net assets of Asquith Resources Inc. at the date of the RTO Transaction deemed to have been acquired by AXMIN. Since the RTO Transaction is accounted for as a reverse take-over the com- parative figures shown in the financial statements are those  of AXMIN. The Company is an international mineral exploration company with a substantial exploration portfolio in the mineral belts of the Central African Republic, Mali, Ghana, Senegal and Tanzania. The Company is the process of explor- ing its mineral properties and  has not yet determined whether these properties contain reserves that are economically recoverable. To date the Company has raised funds to explore its mineral  properties through the issuance of shares. In the foreseeable future the Company will remain depend- ent on the issuance of further shares to raise funds to explore its properties. The costs relating to the acquisi- tion, exploration and development of mineral properties, less  recoveries, are capitalized by property until the commencement of commercial production. If com- mercially profitable ore reserves are developed, capitalized costs of the related project are reclassified as mining assets and amortized on a unit of production method.  If it is determined that capitalized acquisition, exploration and devel- opment costs are not recoverable over the estimated life of the property, or the project is sold or abandoned, the project is written down to its net realizable value. The recoverability of amounts recorded for exploration and development costs is dependent upon the discovery of economical- ly recoverable reserves, the ability of the Company to obtain the  necessary financing to complete the exploration and development, and future profitable production or proceeds from the disposition thereof. The amounts shown as exploration and development costs do not necessarily represent present or future values. As at December 31, 2001 the Company had capitalized US$7.445 million of exploration and development costs. The com- parative figure as at December 31, 2000 was US$6.404 million. Year ended December 31, 2001 compared to the year ended December 31, 2000 There were no revenues in either year as the Company did not have any operations in production.  Administration costs in 2001 were US$0.297 million compared to US$0.403 million in 2000 reflecting the cost savings from the reloca- tion of AXMIN’s administrative and support functions to a lower cost region. At year-end 2001 a review of the carrying values of the Company’s exploration and development property assets led to a write- down of US$0.145 million as  compared with a write-down of US$0.411 million in 2000. The write-down of exploration and development costs reflects the Company’s policy of continually assessing the economic viability of its projects and where  necessary writing them down to their net realizable value. The net loss for operations in 2001 was US$0.429 million as compared to US$0.817 million  in 2000. As at December 31, 2001 the Company had cash resources of US$1.323 million compared to the Liquidity and Capital Resources  Results of Operations 9