Final Results

Berkeley Resources Limited 27 September 2007 BERKELEY RESOURCES LIMITED ANNUAL FINANCIAL REPORT 30 JUNE 2007 ABN 40 052 468 569 CORPORATE DIRECTORY Directors Share Registry Dr Robert Hawley - Chairman Australia Mr Matthew Syme - Managing Director Computershare Investor Services Pty Ltd Dr James Ross Level 2 Senor Jose Ramon Esteruelas 45 St Georges Terrace Mr Sean James Perth WA 6000 Telephone: +61 8 9323 2000 Company Secretary Facsimile: +61 8 9323 2033 Mr Shane Cranswick United Kingdom Registered Office Computershare Investor Services Plc Level 9, BGC Centre PO Box 82 28 The Esplanade The Pavillions Perth WA 6000 Bridgwater Road Australia Bristol BS99 7NH Telephone: +61 8 9322 6322 Telephone: +44 870 889 3105 Facsimile: +61 8 9322 6558 Stock Exchange Listings London Office Australia Office 2.20 Australian Securities Exchange Limited 18 Hanover Square Home Branch - Perth London W1S 1HX 2 The Esplanade United Kingdom Perth WA 6000 Telephone: +44 20 3008 4776 Facsimile: +44 20 3008 8601 United Kingdom London Stock Exchange - AIM 10 Paternoster Square Auditor London EC4M 7LS Stantons International Level 1 ASX/AIM Code 1 Havelock Street BKY - Fully paid ordinary shares West Perth WA 6005 Bankers Website Australia and New Zealand Banking Group Ltd www.berkeleyresources.com.au 77 St Georges Terrace Perth WA 6000 Email info@berkeleyresources.com.au DIRECTORS' REPORT 30 JUNE 2007 The Directors of Berkeley Resources Limited submit their report on the Consolidated Entity consisting of Berkeley Resources Limited ('Company' or ' Berkeley' or 'Parent') and the entities it controlled at the end of, or during, the year ended 30 June 2007 ('Consolidated Entity' or 'Group'). Directors The names of Directors in office at any time during the financial year or since the end of the financial year are: Dr Robert Hawley Mr Matthew Syme Dr James Ross Senor Jose Ramon Esteruelas (appointed 16 November 2006) Mr Sean James (appointed 28 July 2006) Mr Ian Middlemas (resigned 16 November 2006) Unless otherwise disclosed, Directors held their office from 1 July 2006 until the date of this report. Current Directors and Officers Robert Hawley Non-Executive Chairman Qualifications - CBE, DSc, FRSE, FREng, Hon FIET, FIMechEng, FInstP Dr Hawley is based in London and has extensive technical qualifications and substantial expertise in the nuclear energy industry as well as broader public company management. He was Chief Executive of British Energy Plc from 1995 to 1997, Chief Executive of Nuclear Electric Plc from 1992 to 1996 and prior to this enjoyed a long career in senior engineering and management positions with CA Parsons & Co Ltd, Northern Engineering Industries Plc and Rolls-Royce Plc. Dr Hawley has been Managing Director of CA Parsons & Co Ltd, Managing Director of Northern Engineering Industries Plc, a Director of Rolls-Royce Plc, Chairman of Taylor Woodrow Plc, an Advisor Director of HSBC Bank Plc and is presently a director of Colt Telecom Group Ltd, Rutland Trust Plc, Carron Acquisition Co Ltd and Lister Petter Investment Holdings Ltd. He was awarded the CBE in 1997 for services to the Energy Industry and to Engineering. Dr Hawley's experience in managing Nuclear Electric Plc, the largest nuclear generator in the United Kingdom, and British Energy Plc, the United Kingdom's leading electricity supplier, gives him a unique understanding of the nuclear generation sector in Europe and he is acknowledged as an international expert on power generation and energy. During the three year period to the end of the financial year, Dr Hawley has held directorships in Rutland Trust Plc (September 2000 - July 2007), Colt Telecom Group Ltd (August 1998 - present),Carron Acquisition Co Ltd (April 2006 - present) and Lister Petter Investment Holdings Ltd (September 2006 - present). Dr Hawley was appointed a director of Berkeley Resources Limited on 20 April 2006. Matthew Syme Managing Director Qualifications - B.Com, CA Mr Syme is a Chartered Accountant and has over 20 years experience as a senior executive of a number of companies in the Australian resources and media sectors. He was a Manager in a major international Chartered Accounting firm before spending 3 years as an equities analyst in a large stockbroking firm. He was then Chief Financial Officer of Pacmin Mining Limited, a successful Australian gold mining company, as well as a number of other resources companies. Mr Syme was appointed a director of Berkeley Resources Limited on 27 August 2004. Mr Syme has not held any other directorships of listed companies in the last three years. DIRECTORS' REPORT (continued) James Ross Technical Director Qualifications - B.Sc. (Hons.), PhD, FAusIMM, FAICD Dr Ross is a leading international geologist whose technical qualifications include an honours degree in Geology at UWA and a PhD in Economic Geology from UC Berkeley. He first worked with Western Mining Corporation Limited for 25 years, where he held senior positions in exploration, mining and research. Subsequent appointments have been at the level of Executive Director, Managing Director and Chairman in a number of small listed companies in exploration, mining, geophysical technologies, renewable energy and timber. His considerable international experience in exploration and mining includes South America, Africa, South East Asia and the Western Pacific. Dr Ross chairs the Boards of two geosciences research centres and two foundations concerned with geosciences education in Western Australia. He was appointed a director of Berkeley Resources Limited on 4 February 2005 and has not been a director of another listed company in the three years prior to the end of the financial year. Senor Jose Ramon Esteruelas Non-Executive Director Senor Esteruelas is an experienced Spanish executive whose senior executive roles have included Director General of Correos y Telegrafos (the Spanish postal service), President of Minas de Almaden y Arrayanes SA (formerly the world's largest mercury producer) and Chief Executive Officer of Compania Espanola de Tabaco en Rama S.A., the leading tobacco transforming company in Spain. Senor Esteruelas was appointed a Director of Berkeley Resources Limited on 16 November 2006. Senor Esteruelas has not held any other directorships of listed companies in the last three years. Sean James Non-Executive Director Qualifications - B.Sc. (Hons.) Mr James is a mining engineer and was formerly the Managing Director of the Rossing Uranium Mine in Namibia which is the world's largest low grade, open pit uranium mine. After 16 years at Rossing, he returned to London as a Group Mining Executive at Rio Tinto Plc in London. Mr James' experience in managing the Rossing mine is ideally suited for the type of uranium mining operations the Company aims to develop in the Iberian Peninsula. Mr James was appointed a Director of Berkeley Resources Limited on 28 July 2006. Mr James has not held any other directorships of listed companies in the last three years. Shane Cranswick Company Secretary Qualifications - B.Com, CA, ACIS, SA Fin Mr Cranswick gained a Bachelor of Commerce degree from the University of Western Australia and is a member of the Institute of Chartered Accountants, the Institute of Chartered Secretaries and the Financial Services Institute of Australasia. He commenced his career with an international Chartered Accounting firm and has since worked in the role of Company Secretary for a number of listed companies that operate in the resources sector. Mr Cranswick was appointed Company Secretary of Berkeley Resources Limited on 30 July 2004. DIRECTORS' REPORT (continued) Principal Activities The principal activities of the Consolidated Entity during the year consisted of mineral exploration. There was no significant change in the nature of those activities. Employees 2007 2006 The number of full time equivalent people employed by the Consolidated Entity at balance date 20 6 Dividends No dividends have been declared, provided for or paid in respect of the financial year ended 30 June 2007 (2006: nil). Earnings Per Share 2007 2006 Cents Cents Basic loss per share (7.48) (7.33) Diluted loss per share (7.48) (7.33) Corporate Structure Berkeley Resources Limited is a company limited by shares that is incorporated and domiciled in Australia. The Company has prepared a consolidated financial report including the entities it acquired and controlled during the financial year. Consolidated Results 2007 2006 $ $ Loss of the Consolidated Entity before income tax expense (7,430,597) (3,741,426) Income tax expense - - Net loss (7,430,597) (3,741,426) Net loss attributable to minority interest 1,116,026 - Net loss attributable to members of Berkeley Resources Limited (6,314,571) (3,741,426) Review of Operations AND ACTIVITIES The net loss of the Consolidated Entity after minority interests for the year ended 30 June 2007 was $6,314,571 (2006:$3,741,426). Included in this loss was an amount of $2,357,250 (2006:$1,515,234) representing share based incentive options and an expense of $845,912 in relation to the acquisition of ENUSA's exploration database for the Salamanca I project. During the year the Company continued its focus on developing its uranium exploration projects in Spain. This included further review of its exploration databases and the database for the Salamanca I project acquired from the Spanish national uranium company, ENUSA in October 2006. Drilling commenced in December 2006 at the Salamanca I project with a particular focus on the Retortillo deposit. At the Caceres III project, the main focus was on the Saguazal prospect where initial drill testing was completed in the June 2007 quarter. In April 2007 Berkeley calculated an initial JORC compliant inferred resource for the Retortillo and Zona 7 uranium deposits totalling 11.9 million pounds of U3O8 at an average grade of 723ppm. This estimate was based on verification and re-interpretation of the ENUSA database together with the aid of an eighteen hole drilling programme completed by Berkeley. Further drilling is currently under way at and around Retortillo. DIRECTORS' REPORT (continued) Berkeley is also currently reviewing other uranium exploration opportunities in Europe and elsewhere. The Company sold its Strelley and Kangan North properties in the Pilbara region of Western Australia for cash and share consideration, resulting in a gain on sale of $1m. In December 2006, the Company's securities commenced trading on the Alternative Investment Market (AIM) of the London Stock Exchange. Mr Sean James, former Managing Director of the Rossing Uranium Mine in Namibia, and Senor Jose Ramon Esteruelas, a very experienced Spanish executive, were appointed to the Board of Directors during the year. Corporate and Financial Position The following material corporate events occurred during the year: • On 28 July 2006, Mr Sean James was appointed as an Executive Director of the Company (see Current Directors and Officers above for further details). • On 26 September 2006, the Company announced it was proceeding with the admission of its ordinary shares to trading the Alternative Investment Market (AIM) of the London Stock Exchange. The Company's securities commenced trading on AIM on 6 December 2006; • On 16 November 2006, Senor Jose Ramon Esteruelas was appointed a Director of the Company and Mr Ian Middlemas resigned as a Director of the Company; • On 29 November 2006 the Company announced the sale of its Strelley and Kangan North properties in the Pilbara region of Western Australia to Atlas Iron Limited. In consideration for the sale the Company received $350,000 cash and 1.3 million Atlas Iron Limited ordinary shares then valued at $650,000, resulting in a gain on sale of $1 million; and • During the period to 30 November 2006, 12,111,374 Listed Options and 4,850,000 Unlisted Options were exercised which raised approximately $3.4 million. 157,000 Listed Options were not exercised as at the expiry date of 30 November 2006. • On 10 April 2007, Berkeley announced that the Company had completed an initial JORC compliant resource estimate for the Retortillo and Zona 7 uranium deposits totalling 11.9 million pounds of U3O8 at an average grade of 723ppm. • On 26 April 2007, the Company completed the placement of 12.5 million shares at a price of $1.85 per share with institutional investors raising $23.1million before expenses. • During the financial year Berkeley increased its interest in its main Spanish operating subsidiary, Minera de Rio Alagon SL (''Rio Alagon''), from 51% to 77.5%. Business Strategies and Prospects The Consolidated Entity currently has the following business strategies and prospects over the medium to long term: • To increase its resources at and around Retortillo and commence pre-feasibility studies; • Complete the 100% acquisition of the Spanish uranium projects; and • Continue to examine new opportunities in mineral exploration. Risk Management The Board is responsible for the oversight of the Consolidated Entity's risk management and control framework. Responsibility for control and risk management is delegated to the appropriate level of management with the Managing Director having ultimate responsibility to the Board for the risk management and control framework. Arrangements put in place by the Board to monitor risk management include monthly reporting to the Board in respect of operations and the financial position of the Group. DIRECTORS' REPORT (continued) Significant Changes in the State of Affairs Other than as disclosed below, there were no significant changes in the state of affairs of the Consolidated Entity during the year. • In November 2006 the Company disposed of its Strelley and Kangan North Properties in Western Australia to Atlas Iron Limited. In consideration for the sale the Company received $350,000 cash and 1.3 million Atlas Iron Limited ordinary shares valued at $650,000 resulting in a gain of $1 million. • During the year Berkeley earned a further 22.5% in Rio Alagon to take its holding to 77.5% at 30 June 2007. • In April 2007 the Company completed a placement of 12.5 million new ordinary shares at a price of $1.85 per share, with institutional investors in Europe, the USA, Canada and Australia. The issue raised $23.1 million before expenses. The Company had the following securities on issue at 30 June 2007: Issued and Paid Up Shares Listed Unlisted Director Director Unlisted Options - Options - Incentive Incentive Options - Capital $0.20 $0.20 Options - $1.00 Options - $0.70 $various Balance at 30 June 2006 71,130,321 12,268,374 4,850,000 - 3,000,000 10,600,000 Share placement 12,500,000 - - - - - Director Incentive Options Issue - - - 2,250,000 - - Exercise of Options 17,961,374 (12,111,374) (4,850,000) - (1,000,000) - Expiry of Options - (157,000) - - - - Total at 30 June 2007 101,591,695 - - 2,250,000 2,000,000 10,600,000 Since 30 June 2007 the only movement in securities on issue to 28 September 2007 has been the issue of 2,970,000 employee options exercisable at $1.86 per share under the Employee Option Scheme on 6 August 2007. Significant Post Balance Date Events As at the date of this report there are no matters or circumstances, which have arisen since 30 June 2007 that have significantly affected or may significantly affect: (a) the operations, in financial years subsequent to 30 June 2007, of the Consolidated Entity; (b) the results of those operations, in financial years subsequent to 30 June 2007, of the Consolidated Entity; or (c) the state of affairs, in financial years subsequent to 30 June 2007, of the Consolidated Entity. Environmental Regulation and Performance The Consolidated Entity's operations are subject to various environmental laws and regulations under the relevant government's legislation. Full compliance with these laws and regulations is regarded as a minimum standard for all operations to achieve. Instances of environmental non-compliance by an operation are identified either by external compliance audits or inspections by relevant government authorities. There have been no significant known breaches by the Consolidated Entity during the financial year. DIRECTORS' REPORT (continued) Likely Developments and Expected Results It is the Board's current intention that the Consolidated Entity will continue with development of its Spanish uranium projects and will seek to complete the 100% acquisition of Rio Alagon.The Company will also continue to examine new opportunities in mineral exploration, including uranium. All of these activities are inherently risky and the Board is unable to provide certainty that any or all of these activities will be able to be achieved. In the opinion of the Directors, any further disclosure of information regarding likely developments in the operations of the Consolidated Entity and the expected results of these operations in subsequent financial years may prejudice the interests of the Company and accordingly no further information has been disclosed. To view the financial tables please view the link below http://www.rns-pdf.londonstockexchange.com/rns/6024e_-2007-9-27.pdf This information is provided by RNS The company news service from the London Stock Exchange

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