Final Results

18 March 2004

                              BISICHI MINING PLC                               

                                                                               

                   Preliminary Results to 31st December 2003                   

                                                                               

                           A RECORD YEAR FOR GROWTH                            

                                                                               

                                                                               

                                                       2003               2002
                                                                              
Turnover up 65%                                  £8,781,000         £5,310,000
                                                                              
Profit before tax, depreciation and                                           
                                                                              
     amortisation up 97%                         £2,417,000         £1,225,000
                                                                              
EPS up 116%                                          9.56 p             4.43 p
                                                                              
EPS diluted up 113%                                  9.45 p             4.43 p
                                                                              
Dividend per share up 20%                            1.80 p             1.50 p
                                                                              

 

 

 

·        Direct coal mining is now company's most important activity

·        Important new coal reserves acquired in 2003

·        Coal exports started through Richard's Bay Coal Terminal

·        New coal mining plant and equipment have significantly improved
production volumes

·        14% increase in value of UK investment property portfolio to £13
million

·        Shareholders funds increased by 36% to £11.2 million

 

Commenting on the results, Bisichi Mining PLC's chairman, Michael Heller, said:

 

"The very significant opportunities facing our coal mining business in South
Africa are uniquely underpinned by the income and the assets of our substantial
and growing portfolio of UK retail property investments. Both sides of our
business are mutually supportive and give this company a strength that no other
mining company of a comparable size can match. Add to this our close
affiliation with Endulwini Resources and we are exceptionally well placed to
participate in the opportunities now arising in South Africa".

 

                                      END                                      

                                                                               

For further information, please call:

 

Andrew Heller

Robert Corry,      Bisichi Mining PLC                                       020
7415 5000


 

 

CHAIRMAN'S REVIEW 2003

 

2003 has been another successful year for Bisichi Mining plc.  Group profits on
ordinary activities before taxation, depreciation and amortisation increased to
£2,417,000 (2002: £1,225,000).

 

Direct coal mining is now our most important activity, with Black Wattle now
producing over one million tonnes of coal per year, compared with less than
half a million tonnes 5 years ago. To sustain this growth, Black Wattle has
recently acquired important additional reserves adjacent to the existing mine.
We reported last year that Black Wattle had completed the construction of a
modern railhead, giving the mine an export capability. In the course of last
year, the Richard's Bay Coal Terminal ("RBCT"), which is South Africa's largest
coal export terminal, was opened-up to a limited number of Black Economic
Empowerment companies including our local partner, Endulwini Resources. In late
2003 we started exporting coal through RBCT, via Endulwini Resources, thereby
gaining access to premium priced international markets. We have recently been
informed that this arrangement will continue in the current year.  More details
of this and other issues associated with our direct mining activities are
contained in the Mining Review which follows. 

 

Part of the strength of Bisichi Mining is that its mining activities are
underpinned by a strong UK retail property investment portfolio, managed by
London & Associated Properties plc. This portfolio, which is fully let and 
produces a rental income in excess of £1 million per year, was valued at 31
December 2003 by independent chartered surveyors at £13 million, an increase of
14% on a like for like basis.  The effective management  of our property
investment portfolio by London & Associated Properties is well illustrated by
the performance of our investment in the centre of Northampton, which was
acquired in 2002 for £2.65 million and has been valued at £3.25 million as at
31 December 2003. Bisichi Mining also owns, jointly with London & Associated
Properties, Dragon Retail Properties, which has increased its net assets by 27%
to £2.8 m.

 

Shareholders funds now stand at £11.2 million compared to £8.2 million a year
ago, an increase of 36%.   

 

Following these excellent results, your Directors are recommending a dividend
of 1.8p compared to 1.5p in the previous year.  This will be payable on 16
August 2004 to shareholders on the register on 23 July 2004.

 

Finally, and given the growing importance of our direct mining activities, I am
pleased to be able to inform shareholders that we have recently strengthened
our senior executive management team with the appointment of Mr Tom Kearney as
an executive director. Tom, who joined the Board of Bisichi Mining PLC as a
non-executive director earlier in 2003, has considerable experience in the
international coal business and is an important addition to our management
resource.

 

Turning to our other business interests, Bisichi Mining continues to own 100%
of Mineral Products Limited, which manages a portfolio of equity investments
with a weighting in mineral and natural resource stocks.  This portfolio
provides Bisichi Mining with an easily accessible cash reserve.

 

In closing, I would like to thank the staff of Bisichi Mining, its subsidiaries
both in the United Kingdom and South Africa and our associates in South Africa
for their contribution and continued commitment to your company.  I look
forward to the coming year for your company with confidence.

 

Michael Heller, Chairman

18 March 2004

MINING REVIEW 2003

 

Black Wattle Colliery

As is clear from the Chairman's statement, 2003 was another successful year for
Bisichi Mining's direct mining operation, with profits and production
increasing substantially over 2002.   Significant improvements in mining and
processing, coupled with a buoyant market for Black Wattle's products, have
contributed to this year's successful results.  The groundwork laid in earlier
years is showing results and the mining operation is well placed to continue to
grow.

 

Production

There has been a significant increase in production due, in large part, to
timely and cost effective investment in additional mining equipment with a
resultant reduction in machinery downtime.  All three sections now have back-up
machinery.  Black Wattle is producing over one million tonnes of coal per year.

 

Processing

The fine coal section of the coal processing plant was completed and
commissioned at the end of 2003.  This was timed to coincide with exporting
coal through the Richard's Bay Coal Terminal ("RBCT").  The minus 8 mm fraction
of the run-of-mine coal is now, for the first time, washed and sold on the
export market as a premium product.  Sized products are supplied to local
customers, peas (8mm-25mm) for steam generation and nuts (25mm-80mm) to char
producers, who in turn supply the ferrochrome industry.

 

Final plant adjustments are still being made, which will ultimately result in
the process efficiencies improving, as well as increasing the raw coal feed
capacity to 140,000 tonnes per month.

 

OreReserves

A new reserve block of approximately 3.0 million tonnes of high grade coal
contiguous to Black Wattle Colliery was acquired during 2003. The total
reserves acquired during the past two years cover an area of approximately 300
hectares.  The total in situ tonnage at Black Wattle now stands at some 15
million tonnes.

 

With the new reserves, Black Wattle's range of coal varies from low to high
grade as well as from low to high phosphorous content.  The improved coal
processing facility will, however, allow for most of the reserves to be mined
to supply existing customers.  Very low grade reserves will be mined at a later
stage to supply local power stations. 

 

Shareholders should be aware that in 2004 our mining plan includes mining the
newly-acquired reserves contiguous to existing operations.  The geological
information we have on these reserves is extensive and at times this coal will
be of varying yields.  We have every confidence that the changes we have made
to production and the washing plant in the previous years will permit us to
extract and process this coal efficiently while ensuring the continued high
quality of our saleable products. 

 

Export

RBCT, South Africa's largest coal export terminal, is one of the key drivers in
the international seaborne steam coal market.  Until 2003, the use of RBCT was
restricted to its shareholders, the majority of which are the largest
international coal and mining companies in the world.  In mid 2003, our partner
in Black Wattle, Endulwini Resources, was selected as one of four Black
Economic Empowerment ("BEE") companies allowed to export coal via RBCT in a
RBCT sponsored export program designed to support BEE groups' export
activities.  Consequently, Black Wattle was able to export its first coal on an
FOB basis in the last quarter of 2003. 

 

An expanded export BEE allocation at RBCT has recently been agreed.  Endulwini
Resources is one of the companies in the program.  Access to RBCT will provide
us with substantial opportunities to increase export tonnage and take advantage
of the premium prices found in the international market.

 

Ninghi Marketing Limited

In anticipation of the opening up of RBCT to BEE groups, Endulwini Resources
and Bisichi Mining plc in 2002 established Ninghi Marketing Limited ("Ninghi"),
an international coal marketing and sales organisation based in London.   In
2003, Ninghi entered into two contracts with one of the world's largest
producers and marketers of seaborne coal. 

 

 

Black Economic Empowerment

The management of Black Wattle, its workers, and its shareholders are committed
to implementing the Broad Based Socioeconomic Empowerment Charter for the South
African Mining Industry.  As such, we have agreed to a Charter Action Plan
which lists actions, responsible parties, and deadlines for implementation of
the various aspects of the Charter.  An Implementation Report was prepared for
the executive management of Bisichi Mining and a senior member of the Black
Wattle management team has been appointed Charter Compliance Officer ("CCO"). 

 

We see only opportunity in the changes taking place in South Africa, which are
embodied in the goals of the Mining Charter.  As such, the management and
shareholders of Black Wattle are continuously identifying opportunities which
will further advance the goals of the Mining Charter.  I am pleased to report
that Mrs Duku Mogoai, a director of Black Wattle, has been entrusted with the
responsibility that the mining charter and other current legislation is
successfully implemented.

 

Prospects

Both international and domestic coal prices are strong and Black Wattle is well
placed to take advantage of price movements in both markets.  Demand for our
low phosphorous product remains very strong and the concurrent rise in prices
have allowed Black Wattle to achieve substantial price increases for 2004.  On
the export side, increasing our presence at RBCT on a long-term basis remains
important.  The new washing plant will allow us to increase the yield and
flexibility of our production base, and provides additional capacity for future
growth.

 

The success of Black Wattle and its associated ventures is a direct result of
the strong working relationships that we have established in South Africa with
Mr. Sipho Dube and Mrs Duku Mogoai, of Endulwini Resources, and Mr. Robert
Grobler, our General Mine Manager, and his team at Black Wattle.   We are truly
excited by the opportunities in South Africa and look to the coming year with
confidence.

 

Andrew Heller, Managing Director

18 March 2004


 

                              Bisichi Mining PLC                                            
                                                                                            
                  Preliminary Consolidated Profits Statement                                
                                                                                            
                         Year Ended 31st December 2003                                      
                                                                                            
                                                                       2003             2002
                                                                                            
                                             Notes                     £000             £000
                                                                                            
                                                                                            
                                                                                            
Turnover                                                              8,781            5,310
                                                                                            
Operating costs                                                     (6,896)          (4,525)
                                                                                            
Operating profit                                                      1,885              785
                                                                                            
Income from interests in joint venture                                                      
                                                                         10               69
                                                                                            
Interest receivable                                                                         
                                                                          9                6
                                                                                            
Interest payable                                                      (429)            (232)
                                                                                            
Profit on ordinary activities before taxation                         1,475              628
                                                                                            
Taxation on profit on ordinary activities         1                   (436)            (206)
                                                                                            
Profit after taxation                                                 1,039              422
                                                                                            
Minority interest                                                      (40)                 
                                                                                          41
                                                                                            
Profit for the financial year                                           999              463
                                                                                            
Dividend                                                              (188)            (157)
                                                                                            
Retained profit for the financial year                                  811              306
                                                                                            
                                                                                            
                                                                                            
Earnings per share - basic                        2                  9.56 p           4.43 p
                                                                                            
Earnings per share - diluted                      2                  9.45 p           4.43 p
                                                                                            
Dividend per share                                3                  1.80 p           1.50 p
                                                                                            
                                                                                            
                                                                                            
Turnover and operating profit for the year derive from continuing operations,               
which are made up as follows:                                                               
                                                                                            
                                       Turnover                      Operating profit       
                                                                                            
                                     2003            2002              2003             2002
                                                                                            
                                     £000            £000              £000             £000
                                                                                            
Mining                                              4,423             1,353              504
                                    7,571                                                   
                                                                                            
Goodwill amortised                                                     (85)             (84)
                                      -               -                                     
                                                                                            
                                                    4,423             1,268              420
                                    7,571                                                   
                                                                                            
Property                                              842               587              349
                                    1,092                                                   
                                                                                            
Share dealing                                                                               
                                      105              36                20                9
                                                                                            
Other investments                                                                           
                                       13               9                10                7
                                                                                            
Group                                               5,310             1,885              785
                                    8,781                                                   
                                                                                            
                                                                                            
                                                                                            
                              Bisichi Mining PLC                                            
                                                                                            
                          Consolidated Balance Sheet                                        
                                                                                            
                             At 31st December 2003                                          
                                                                                            
                                                                       2003             2002
                                                                                            
                                                                       £000             £000
                                                                                            
Fixed assets                                                                                
                                                                                            
Intangible assets                                                                        132
                                                                         47                 
                                                                                            
Tangible assets                                                      16,255           13,307
                                                                                            
Investment in joint venture                                           1,408            1,109
                                                                                            
Other investments                                                       336              299
                                                                                            
                                                                     18,046           14,847
                                                                                            
Current assets                                                                              
                                                                                            
Stocks - goods for resale                                                                   
                                                                         50               46
                                                                                            
Debtors                                                               1,977            1,039
                                                                                            
Investments (Market value £518,000 (2002 - £531,000))                   419              490
                                                                                            
Bank balances                                                           126                 
                                                                                          80
                                                                                            
                                                                      2,572            1,655
                                                                                            
Creditors - amounts falling due within one year                     (5,058)          (3,200)
                                                                                            
Net current liabilities                                             (2,486)          (1,545)
                                                                                            
Total assets less current liabilities                                15,560           13,302
                                                                                            
Creditors - amounts falling due after one                           (4,452)          (5,174)
year                                                                                        
                                                                                            
Provisions for liabilities and charges                                 (57)             (70)
                                                                                            
Minority interests                                                      116              138
                                                                                            
                                                                     11,167            8,196
                                                                                            
Capital and reserves                                                                        
                                                                                            
Called up share capital                                               1,045            1,045
                                                                                            
Revaluation reserve                                                   7,729            5,967
                                                                                            
Other reserve                                                                               
                                                                         86               86
                                                                                            
Retained earnings                                                     2,307            1,098
                                                                                            
Shareholders' funds                                                  11,167            8,196
                                                                                            
Statement of total recognised gains and losses                                              
                                                                                            
The company                                                             902                 
                                                                                           6
                                                                                            
Subsidiaries and associated undertaking                                  97              457
                                                                                            
Profit for the year                                                     999              463
                                                                                            
Revaluation of investment properties - company                        1,619              492
                                                                                            
                                     - joint venture                    360              228
                                                                                            
Tax on disposal of investment properties in joint venture              (28)                -
                                                                                            
Exchange adjustments                                                    209              227
                                                                                            
Total gains recognised in the year                                    3,159            1,410
                                                                                            
                              Bisichi Mining PLC                                            
                                                                                            
                       Consolidated Cash Flow Statement                                     
                                                                                            
                             At 31st December 2003                                          
                                                                                            
                                                                       2003             2002
                                                                                            
                                                                       £000             £000
                                                                                            
Net cash inflow from operating activities                             2,174            1,628
                                                                                            
Dividend from joint venture                                                                 
                                                                         42               40
                                                                                            
Returns on investments and servicing of finance                                             
                                                                                            
          Interest received                                                                 
                                                                          9                6
                                                                                            
          Interest paid                                               (429)            (232)
                                                                                            
                                                                      (420)            (226)
                                                                                            
Taxation                                                                                    
                                                                                            
          Corporation tax paid                                        (178)             (80)
                                                                                            
Capital investment and financial investment                                                 
                                                                                            
          Payments to acquire fixed assets                          (1,921)          (4,607)
                                                                                            
          Payments to acquire current asset investments                                 (29)
                                                                        -                   
                                                                                            
          Receipts from sale of fixed assets                                                
                                                                          9              -  
                                                                                            
          Receipts from sale of current asset investments                                   
                                                                         88               21
                                                                                            
                                                                    (1,824)          (4,615)
                                                                                            
Equity dividends paid                                                 (157)            (105)
                                                                                            
Cash outflow before                                                   (363)          (3,358)
financing                                                                                   
                                                                                            
Financing                                                                                   
                                                                                            
          Loans (repaid) drawn                                        (126)            3,460
                                                                                            
(Decrease) increase in cash in the year                               (489)              102
                                                                                            
                                                                                            
                                                                                            
Reconciliation of net cash flow to movement in net debt                                     
                                                                                            
(Decrease) increase in cash in the year                               (489)              102
                                                                                            
Net cash flow from changes in debt                                      126          (3,460)
                                                                                            
Movement in net debt in the year                                      (363)          (3,358)
                                                                                            
Net debt at 1 January 2003                                          (6,221)          (2,863)
                                                                                            
Net debt at 31 December 2003                                        (6,584)          (6,221)
                                                                                            
Reconciliation of operating profit to net cash inflow from operating                        
activities:                                                                                 
                                                                                            
                                                                                            
                                                                                            
Operating profit                                                      1,885              785
                                                                                            
Depreciation charges                                                    857              513
                                                                                            
Goodwill amortised                                                                          
                                                                         85               84
                                                                                            
Provision against current asset investment                               19                -
                                                                                            
Profit on sale of current asset investments                            (35)                 
                                                                                         (8)
                                                                                            
Decrease in stocks                                                                      (26)
                                                                          3                 
                                                                                            
Increase in debtors                                                   (732)            (147)
                                                                                            
Increase in creditors                                                                    427
                                                                         92                 
                                                                                            
                                                                      2,174            1,628
                                                                                            
                                                                                            
                                                                                            
Analysis of changes in net debt                                                             
                                                                                            
                              At 1 January     Cash flows       Exchange     At 31 December 
                                  2003                         adjustment         2003      
                                                                                            
                                     £000            £000              £000             £000
                                                                                            
Bank balances                                                                            126
                                       80              43                 3                 
                                                                                            
Overdrafts                                          (532)                            (1,305)
                                    (769)                               (4)                 
                                                                                            
                                                    (489)                            (1,179)
                                    (689)                               (1)                 
                                                                                            
Debt due within one year                            (591)                              (953)
                                    (358)                               (4)                 
                                                                                            
Debt due in after one year                            717                            (4,452)
                                  (5,174)                                 5                 
                                                                                            
                                                    (363)                            (6,584)
                                  (6,221)                               -                   
                                                                                            
                                                                                            
                                                                                            
NOTES:                                                                 2003             2002
                                                                                            
                                                                       £000             £000
                                                                                            
                                                                                            
                                                                                            
  1.   Taxation                                                                             
                                                                                            
       Based on the results for the year:                                                   
                                                                                            
       Corporation tax at 30% (2002 : 30%)                              463              181
                                                                                            
       Prior year adjustment - UK                                      (15)                 
                                                                                         -  
                                                                                            
       Joint venture                                                                        
                                                                          1               22
                                                                                            
                                                                        449              203
                                                                                            
       Deferred taxation                                               (13)                 
                                                                                           3
                                                                                            
                                                                        436              206
                                                                                            
                                                                                            
                                                                                            
  2.   Earnings per share                                                                   
                                                                                            
                                                                                            
       Both the basic and diluted earnings per share calculations are based on a            
       profit of                                                                            
                                                                                            
       £999,000 (2002: £463,000). The basic earnings per share has been calculated on       
                                                                                            
       10,451,506 (2002: 10,451,506) ordinary shares being in issue during the year.        
       The                                                                                  
                                                                                            
       diluted earnings per share has been calculated on the number of shares in issue      
       of                                                                                   
                                                                                            
       10,451,506 (2002: 10,451,506) plus the dilutive potential ordinary shares            
       arising from share options of 118,626 (2002: 571) totalling 10,570,132 (2002:        
       10,452,077).                                                                         
                                                                                            
                                                                                            
                                                                                            
                                                                                            
                                                                                            
  3.   Dividend                                                                             
                                                                                            
                                                                                            
       The proposed final dividend of 1.80p will be paid on 16 August 2004 to               
       shareholders registered at the close of business on 23 July 2004.                    
                                                                                            
                                                                                            
       The figures for the year ended 31 December 2002 are based on the audited             
  4.   accounts                                                                             
                                                                                            
       for that year, which have been delivered to the Registrar of Companies and on        
       which the Auditors gave an unqualified report.  The statutory accounts for the       
       year ended 31                                                                        
                                                                                            
       December 2003, which have been prepared using the same accounting policies as        
       in                                                                                   
                                                                                            
       2002, have been completed and an unqualified audit opinion will be issued.  The      
       figures in the preliminary announcement are an extract and do not constitute         
       statutory accounts within the meaning of the Companies Act 1985. The board           
       approved this preliminary statement on 17 March 2004.