Interim Results

Tertiary Minerals PLC 22 May 2006 Tertiary Minerals plc Interim Statement For the six months ended 31 March 2006 Chairman's Statement I am pleased to report the Company's progress and interim results for the six-month period ended 31 March 2006. Review of Activities The past six months has seen pleasing progress on the Company's projects reflected in a strong share-price recovery. In March 2006 a US$7 million joint venture funding agreement was signed with a consortium of two Saudi companies for feasibility studies for the joint development of the Company's world-class Ghurayyah tantalum-niobium-zircon- (uranium-yttrium) deposit in Saudi Arabia. Preliminary feasibility studies are now well underway and will focus on metallurgical testing, market studies and process definition. In addition, a 22 hole, 2,000 metre drilling programme has just been completed to collect a 50 tonne sample for follow up metallurgical testwork and also to provide assay information for resource upgrading for that part of the 400 million tonne Inferred Mineral Resource that will be mined in the first years of the project. As a result of the joint venture funding agreement the two Saudi Consortium members - A.H. Algosaibi & Bros. Co. and Al Nahla Trading & Contracting Co. - have acquired significant shareholdings in the Company and we look forward to working with them for the development of Ghurayyah and in the consideration of other mining projects. We are continuing to support our 24.6% held associated, AIM traded diamond exploration company, Sunrise Diamonds plc ('Sunrise'), and in February 2006 participated in a small share placing to maintain our level of interest. Sunrise has had an exciting first year as a public company and has built up a very significant diamond exploration portfolio in Finland with 7 recent kimberlite discoveries in the Kuusamo area backed up by exclusive access to BHP Billiton's extensive US$10 million Finland exploration database. Exploration work on our directly held Scandinavian exploration projects has been at a 'care and maintenance' level for the past 6 months whilst resources and attention were focused on funding and feasibility activities at Ghurayyah, but it is planned that work on the various gold and gold-copper exploration projects in Sweden and Finland will be intensified during the rest of the year, as funds allow. The past six-months efforts have seen the Company's share price improve from a low of less than 5p with a significant increase in trading volumes. I would like to express my thanks to the Board for its support in bringing the Company through this pivotal period. Results The Group loss for the six month period was £134,012. This includes a share of the losses of the associated undertaking, Sunrise Diamonds plc, of £25,269, administration expenses of £133,470, exploration costs (written off) of £11,307, a profit of £25,052 arising from the increase in value of the Group's share of the net assets of Sunrise Diamonds plc and interest receivable of £10,982. Patrick L Cheetham 22 May 2006 Executive Chairman For further information contact: Tertiary Minerals plc Tel: +44 (0)1625 626203 Sunrise House Fax: +44 (0)1625 626204 Hulley Road Macclesfield Website ; www.tertiaryminerasl.com Cheshire. SK10 2LP. UK Consolidated Profit and Loss Account for the six months to 31 March 2006 Six months to Six months to Twelve months 31 March 2006 31 March 2005 to 30 September Unaudited Unaudited 2005 £ £ £ ---------- --------- --------- Exploration costs written off 11,307 137,328 294,088 Administrative expenses 133,470 186,816 310,269 ---------- --------- --------- Operating loss (144,777) (324,144) (604,357) Share of operating loss of associate (26,925) - (44,892) Profit on disposal of intangible fixed assets - - 75,100 Profit arising from the increase in value of the Group's share of the net assets of Sunrise Diamonds resulting from its recent share issue 25,052 - 134,371 Interest receivable 10,982 9,798 22,579 Share of interest receivable of associate 1,656 - 1,396 ---------- --------- --------- Loss on ordinary activities before taxation (134,012) (314,346) (415,803) Tax on profit on - - - ordinary activities ---------- --------- --------- Loss for the financial period (134,012) (314,346) (415,803) ---------- --------- --------- Loss per share - basic (pence) (note 2) (0.27) (0.70) (0.93) ---------- --------- --------- All amounts relate to continuing activities. Consolidated Statement of Total Recognised Gains and Losses for the six months to 31 March 2006 Six months to 31 March Six months to 31 March Twelve months to 30 2006 Unaudited 2005 Unaudited September 2005 £ £ £ ---------- --------- --------- Loss for the period (134,012) (314,346) (415,803) Foreign exchange translation differences on foreign currency net investments 6,958 2,377 (19,488) in ---------- --------- --------- subsidiaries Total recognised losses since last (127,054) (311,969) (435,291) accounts ---------- --------- --------- Consolidated Balance Sheet as at 31 March 2006 As at 31 As at 31 As at 30 March 2006 March 2005 September Unaudited Unaudited 2005 £ £ £ ---------- --------- --------- Fixed assets Intangible Assets 1,090,212 1,100,368 943,219 Tangible Assets 11,535 6,338 5,676 Share of net assets of associate 219,928 - 157,350 ---------- --------- --------- 1,321,675 1,106,706 1,106,245 Current assets Debtors 1,062,839 91,184 65,705 Cash at bank and in hand 605,082 656,880 435,969 ---------- --------- --------- 1,667,921 748,064 501,674 ---------- --------- --------- Creditors: amounts falling 131,119 161,442 37,916 due within one year ---------- --------- --------- Net current assets 1,536,802 586,622 463,758 ---------- --------- --------- ---------- --------- --------- Creditors: amounts falling 915,537 - - due after more than one year ---------- --------- --------- Total assets less current liabilities 1,942,940 1,693,328 1,570,003 ---------- --------- --------- Capital and reserves Called up share capital 514,210 464,210 464,210 Share premium account 3,826,853 3,376,865 3,376,862 Merger reserve 131,096 131,096 131,096 Profit and loss account (2,529,219) (2,278,843) (2,402,165) ---------- --------- --------- Shareholders' funds 1,942,940 1,693,328 1,570,003 ---------- --------- --------- Consolidated Cash Flow Statement for the six months to 31 March 2006 Six months to 31 March Six months to 31 Twelve months to 30 2006 Unaudited March 2005 September Unaudited 2005 £ £ £ ---------- --------- --------- Net cash outflow from operating (136,673) (148,393) (303,749) activities (note 3) Returns on investments and servicing 10,907 9,798 19,898 of finance Capital expenditure and financial (139,523) (237,531) (158,333) investment Acquisition and 65,250 - (150,000) disposals ---------- --------- --------- Net cash outflow before (330,539) (376,126) (592,184) financing Financing 499,652 475,340 470,487 ---------- --------- --------- ---------- --------- --------- Increase/ (Decrease) in 169,113 99,214 (121,697) cash in the period(note 4) ---------- --------- --------- Notes to the Interim Statement 1. Basis of preparation The interim statement has been prepared on the basis of the accounting policies set out in the Company's financial statements for the year ended 30 September 2005. The financial information set out in this statement relating to the year ended 30 September 2005 does not constitute statutory accounts for that period. Full audited accounts in respect of that financial year (which received an unqualified audit opinion and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985) have been delivered to the Registrar of Companies. The Directors are satisfied that the Group has adequate resources to continue to operate for the foreseeable future. For this reason they continue to adopt the 'going concern' basis for preparing the accounts. The interim statement has been approved by the Directors and is unaudited. Comparative figures for the six months ended 31 March 2005 are extracts from the interim report for that period and are also unaudited. 2. Loss per share Loss per share has been calculated on the attributable loss for the period and the weighted average number of shares in issue during the period. Six months to 31 March Six months to 31 March Twelve months 2006 2005 to Unaudited Unaudited 30 September 2005 ---------- --------- --------- Loss for the period (£) (134,012) (314,347) (415,803) Weighted average shares 49,415,598 42,629,883 44,530,682 in issue (No.) Basic loss per (0.27) (0.70) (0.93) share ---------- --------- --------- (pence) The loss attributable to ordinary shareholders and the weighted average number of ordinary shares used for the purpose of calculating diluted earnings per share, are identical to those used to calculate the basic earnings per ordinary share. This is because the exercise of share warrants would have the effect of reducing the loss per ordinary share and is therefore not dilutive under the terms of FRS 14. 3. Reconciliation of operating loss to net cash outflow from operating activities Six months to 31 Six months to 31 March 2005 Twelve months March Unaudited to 2006 Unaudited 30 September 2005 £ £ £ ---------- --------- --------- Operating (145,281) (324,144) (604,357) loss Depreciation charge 1,491 1,742 3,035 Intangible fixed assets written off - 95,616 305,921 Disposal of fixed assets 2,673 - (74,900) (Increase)/ Decrease in (17,080) (20,601) 4,878 debtors Increase/ (Decrease) in 21,524 98,994 (24,532) creditors Share of operating loss of subsidiary prior to it - - 86,206 becoming an ---------- --------- --------- associate Net cash outflow from operating activities (136,673) (148,393) (303,749) ---------- --------- --------- 4. Reconciliation of net cash outflow to movement in net funds Six months to 31 March 2006 Six months to 31 March Twelve months Unaudited 2005 to Unaudited 30 September 2005 £ £ £ ---------- --------- --------- Increase/ (Decrease) in 169,113 99,214 (121,697) net cash in the period Opening net funds 435,969 557,666 557,666 ---------- --------- --------- Closing net funds 605,082 656,880 435,969 ---------- --------- --------- 5. Financial information regarding associated undertaking At the balance sheet date Tertiary Minerals plc owned 24.58% of Sunrise Diamonds plc's net assets. 6. Interim report Copies of this interim report will be sent to all shareholders and are available from Tertiary Minerals plc, Sunrise House, Hulley Road, Macclesfield, Cheshire, SK10 2LP, United Kingdom. This information is provided by RNS The company news service from the London Stock Exchange

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