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Van Dieman Mines plc (VDM)

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Tuesday 20 September, 2005

Van Dieman Mines plc

Interim Results

Van Dieman Mines plc
20 September 2005




                   VAN DIEMAN MINES PLC ('VAN DIEMAN' OR 'THE COMPANY')


                  Half-Year Report and Financial Statements
                      for the period ended 30 June 2005







CHAIRMAN'S STATEMENT

I am pleased to report the Company's progress and interim results for the six
month period ended 30 June, 2005.

Review of Activities

Since the publication of the last annual report, your Board has been working
hard towards achieving startup at the end of this year and full production from
both the Scotia and Endurance mines during the first half of next year.

We are pleased to report that much progress has been made since the tabling of
our annual report in June.

The grant of a mining lease for the Scotia mine was received from the Tasmanian
Minister for Infrastructure, Energy and Resources on 7 July, 2005. The Company
has received notification from the Registrar of Mines that grant of mining lease
documentation for the Endurance mine will be forwarded to the Company for
execution week ending 23 September, 2005. The grant of these leases paves the
way for commencement of mining by the end of the year.

The pilot treatment plant has been commissioned and is being modified to conform
with local requirements prior to commencing the bulk sampling programme to
produce representative samples of mine rough sapphire for evaluation by
potential distributors and jewellery manufacturers in the USA. Tin concentrate
produced from the sampling programme will be sent to the Company's contracted
smelter for preproduction evaluation.

On 6 July 2005, the Company signed a six-year contract with Thailand Smelting
and Refining Co Ltd ('Thaisarco') for the smelting and purchase of its entire
output of tin concentrates from the Company's mining operations. The contract is
based on the LME tin price at the time of delivery of concentrate and, at
current tin prices, the total value of the contract to Van Dieman is some US$60
million.

In June the Company finalised the design of the treatment plants with Goldfield
Engineering and the resulting quotations confirmed budget forecast figures.

The Company's operating headquarters in Gladstone are now in service, providing
office space and limited accommodation. The Company has also purchased a 10 acre
site in Gladstone for its depot and planning application has been lodged for the
construction of the tin cleanup shed and shipping facility.

Results

The consolidated loss on ordinary activities, after tax, for the six month
period was £199,043. This comprises administrative expenses of £262,661 and
interest earned of £63,618. Cash at bank and on hand at the end of the period
totalled £2,266,543.

M.J. Spriggs - Chairman
VAN DIEMAN MINES PLC

                     CONSOLIDATED PROFIT AND LOSS ACCOUNT
                FOR THE SIX MONTHS TO 30 JUNE 2005 - UNAUDITED

                                                30 June 2005      Period from 24
                                                                  May 2004 to 31
                                                                 December 2004
                                                           £                 £
TURNOVER

Administrative Expenses
Continuing                                          (262,661)          (50,610)
Acquired
business                                                   -          (515,127)
                                                     ---------       -----------
                                                    (262,661)         (565,737)
                                                     ---------       -----------

OPERATING LOSS
Continuing                                          (262,661)          (50,610)
Acquired
business                                                   -          (515,127)
                                                     ---------       -----------
                                                    (262,661)         (565,737)

Interest
received                                              64,730             6,370
Interest
payable and
similar
charges                                               (1,112)
                                                     ---------       -----------
LOSS ON ORDINARY ACTIVITIES
BEFORE
TAXATION                                            (199,043)         (559,367)

Tax on loss on ordinary activities                         -                 -
                                                     ---------       -----------
LOSS ON ORDINARY ACTIVITIES
AFTER TAXATION                                      (199,043)         (559,367)
                                                     ---------       -----------

RETAINED LOSS
FOR THE PERIOD                                      (199,043)         (559,367)
                                                     =========       ===========

Loss per share
- basic                                                (0.28p)           (0.99p)
Loss per share
- diluted                                              (0.27p)           (0.97p)

CONTINUING OPERATIONS
All the group's activities consist of
continuing operations.

TOTAL RECOGNISED GAINS AND LOSSES
The group has no recognised gains or losses
other than the loss for the current period


VAN DIEMAN MINES PLC

CONSOLIDATED RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

                                                  30 June 2005      Period from
                                                                    24 May 2004
                                                                  to 31 December
                                                                           2004
                                                             £                £

Loss for the
period                                                (199,043)        (559,367)

Other movements:
      New shares issued                                      -        4,618,881
      Exchange gain on consolidation of foreign        127,139          115,239
      subsidiary                                       ---------        ---------
                                                       ---------        ---------

Total
movements
during the
period                                                 (71,904)       4,174,753
                                                       ---------        ---------

Shareholders'
funds at end
of period                                              (71,904)       4,174,753
                                                       =========        =========



CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES

                                                  30 June 2005      Period from
                                                                    24 May 2004
                                                                  to 31 December
                                                                           2004
                                                             £                £

Loss for the
period                                                (199,043)        (559,367)
Exchange gain
on
consolidation
of foreign
subsidiary                                             127,139          115,239
                                                       ---------         --------

Total gains
and losses in
period                                                 (71,904)        (444,128)
                                                       =========         ========



VAN DIEMAN MINES PLC

                          CONSOLIDATED BALANCE SHEET
                           30 JUNE 2005 - UNAUDITED
                                                                  Period ended
                                                   30 June 2005    31 December
                                                                          2004
                                                              £              £
FIXED ASSETS
Tangible assets                                       2,017,399      1,597,680
                                                        ---------      ---------
                                                      2,017,399      1,597,680
                                                        ---------      ---------

CURRENT ASSETS
Debtors                                                 111,331         69,542
Cash at bank and on hand                              2,266,543      2,603,870
                                                        ---------      ---------
                                                      2,377,874      2,673,412

Creditors: Amounts falling due within one year          132,475         96,339
                                                        ---------      ---------

NET CURRENT ASSETS                                    2,245,399      2,577,073
                                                        ---------      ---------

TOTAL ASSETS LESS CURRENT LIABILITIES                 4,262,798      4,174,753
                                                        ---------      ---------

Creditors: Amounts falling due after more than one
year                                                    159,949              -
                                                        ---------      ---------
                                                      4,102,849      4,174,753
                                                        =========      =========

CAPITAL AND RESERVES
Called up share capital                                 716,577        716,577
Share premium                                         3,902,304      3,902,304
Profit and loss account                                (516,032)      (444,128)
                                                        ---------      ---------

SHAREHOLDERS' FUNDS                                   4,102,849      4,174,753
                                                        =========      =========




On behalf of the board:

Director




  VAN DIEMAN MINES PLC

                       CONSOLIDATED STATEMENT OF CASH FLOWS
               FOR THE 6 MONTHS PERIOD TO 30 JUNE 2005 - UNAUDITED
                                          Notes   30 June 2005      Period ended
                                                                     31 December
                                                                            2004
                                                             £                 £

  NET CASH OUTFLOW FROM OPERATING
  ACTIVITIES                                          (253,619)         (382,825)

  CAPITAL EXPENDITURE AND FINANCIAL
  INVESTMENT
  Payments to acquire tangible fixed
  assets and mining exploration
  expenditure                                         (373,200)          (85,973)

  RETURNS ON INVESTMENTS & SERVICING OF
  FINANCE
  Interest Receivable                                   64,730             6,370
  Interest Paid                                         (1,112)                -

  ACQUISITIONS AND DISPOSALS
  Fees on acquisition of investment                          -            (6,885)
  Net cash acquired with subsidiary
  undertaking                                                -           167,138
                                                       ---------         ---------
                                                             -           160,253
                                                       ---------         ---------

  NET CASH OUTFLOW BEFORE FINANCING                   (563,201)         (302,175)
                                                       ---------         ---------

  FINANCING
  Issue of ordinary share capital                            -         2,843,032
  Borrowings                                           225,874            63,013
                                                       ---------         ---------
                                                       225,874         2,906,045

  MANAGEMENT OF LIQUID RESOURCES
  Decrease/(Increase) in cash on short
  term deposits                                         56,706        (2,275,152)
                                                       ---------         ---------

  (DECREASE)/INCREASE IN CASH                         (280,621)          328,718
                                                       =========         =========

  RECONCILIATION OF NET CASH FLOW TO MOVEMENT
  IN NET FUNDS
  (Decrease)/Increase in cash                         (280,621)          328,718
  (Decrease)/Increase in short term
  deposits                                             (56,706)        2,275,152
                                                       ---------         ---------

  MOVEMENT IN NET FUNDS                               (337,327)        2,603,870
  NET FUNDS AT BEGINNING OF PERIOD                   2,603,870                 -
                                                       ---------         ---------

  NET FUNDS AT END OF PERIOD                         2,266,543         2,603,870
                                                       =========         =========



VAN DIEMAN MINES PLC

                      NOTES TO THE FINANCIAL STATEMENTS
                FOR THE SIX MONTHS TO 30 JUNE 2005 - UNAUDITED

   1.  ACCOUNTING POLICIES

Accounting convention

The financial statements have been prepared in accordance with applicable
accounting standards generally accepted in the United Kingdom. These interim
financial statements are unaudited and do not constitute statutory accounts as
defined by Section 240 of the Companies Act 1985.

Application of the going concern basis

In common with many mining companies, the successful outcome of the project is
dependent upon the granting of mining licenses and the Group controlling its
development costs and realizing income from its production in line with its
business plan.

The Group is firmly on track with the process of securing the orderly
development of its principal properties. Applications for mining licenses and
other and other approvals have been lodged and no significant impediments are
anticipated. The directors have prepared profit and cash flow projections which
support the view that the group has adequate financial resources to develop the
existing properties to the point of profitable production without any need for
further fundraising. The directors therefore believe that it is appropriate to
prepare the accounts on a going concern basis.

Comparative information

The company was incorporated on 24 May 2004 and did not commence trading until
15 September 2004, when it acquired all the issued capital of Van Dieman Mines
Pty Ltd. As the group was formed in September 2004, comparatives have not been
provided for the period ended 30 June 2004.

Basis of consolidation

The financial statements consolidate the accounts of Van Dieman Mines plc and
its subsidiary undertakings. The results of subsidiaries are included from the
date of acquisition.

Depreciation

Depreciation is provided on all tangible fixed assets, at rates calculated to
write off the cost, less estimated residual value based on prices prevailing at
the date of acquisition of each asset evenly over its expected useful life as
follows:

Plant and equipment - over 3 to 15 years

Exploration expenditure will be amortised over expected production volumes from
the date production commences.

Deferred Taxation

Deferred taxation is recognised in respect of all timing differences that have
originated at the balance sheet date where transactions or events have occurred
at that date that will result in an obligation to pay more, or a right to pay
less or to receive more tax with the following exceptions:

Provision is made for tax on gains arising from the revaluation (and similar
fair value adjustments) of fixed assets and gains on disposal of fixed assets
that have been rolled over into replacements assets, only to the extent that, at
the balance sheet date, there is a binding agreement to dispose of the assets
concerned. However, no provision is made where, on the bases of all available
evidence at the balance sheet date, it is more likely than not that the taxable
gain will be rolled over into replacement assets and charged to tax only where
the replacements assets are sold.



VAN DIEMAN MINES PLC

                      NOTES TO THE FINANCIAL STATEMENTS
                FOR THE SIX MONTHS TO 30 JUNE 2005 - UNAUDITED

   1.  ACCOUNTING POLICIES - CONTINUED

Deferred tax assets are recognized only to the extent that the directors
consider that it is more likely than not that there will be suitable taxable
profits from which the future reversal of the underlying timing differences can
be deducted.

Deferred tax is measured on an undiscounted basis at the tax rates that are
expected to apply in the periods in which the timing differences reverse, based
on tax rates and laws enacted or substantively enacted at the balance sheet
date.

Foreign currencies

Transactions in foreign currencies are recorded at the rate ruling at the date
of the transaction or at the contracted rate if the transaction is covered by a
forward exchange contract. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling at the
balance sheet date or if appropriate at the forward contract rate and
differences taken to the profit and loss account.

The accounts of overseas subsidiary undertakings are translated at the rate of
exchange ruling at the balance sheet date. The exchange difference arising on
the retranslation of opening net assets are eliminated against reserves. All
other translation differences are taken to the profit and loss account.

Exploration and Evaluation Expenditure

Costs arising from exploration and evaluation activities are carried forward
provided such costs are expected to be recouped through successful development
or by sale or where exploration and evaluation activities have not, at the
reporting date, reached a stage to allow a reasonable assessment regarding the
existence of economically recoverable reserves.

Costs are not carried forward where the directors believe the recovery of those
assets is not probable.

Cost carried forward in respect of an area of interest that is abandoned are
written off in the period in which the decision to abandon is made.

   2.  LOSS PER SHARE
                                                  30 June 2005    Period ended
                                                                     31 December
                                                                          2004
                                                             £               £
Loss per share - basic                                   (0.28p)         (0.99p)
Loss per share - diluted                                 (0.27p)         (0.97p)
                                                      ==========      ==========

The calculation of basic loss per share is based on a loss for the period of
£199,043 and on 71,657,663 ordinary shares, being the weighted average number of
ordinary shares on issue during the period.

The diluted loss per share assumes dilutive share options are converted into
ordinary shares. The calculation is as follows:
                                                          Loss           Share
                                                             £              No
Basic loss                                            (199,043)     71,657,663
Diluted effects - options                                            1,180,000
                                                      ----------      ----------

Diluted loss                                          (199,043)     72,837,663
                                                      ==========      ==========


  VAN DIEMAN MINES PLC

                        NOTES TO THE FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS TO 30 JUNE 2005 - UNAUDITED

    3.  NOTES TO THE STATEMENT OF CASH FLOWS

  (a) Reconciliation of operating loss to net cash flow
                                                                   Period ended
                                                    30 June 2005    31 December
                                                                           2004
                                                               £              £
  Operating loss                                        (262,661)      (565,737)
  (Increase) in debtors                                  (22,075)       (21,375)
  Increase in creditors                                   21,995        195,185
  Depreciation                                             9,122          9,102
                                                         ---------      ---------
                                                        (253,619)      (382,825)
                                                         =========      =========


  (b) Analysis of changes in net funds

  31 December 2004                   Cash Flows            Other   At 31 December
                                                                           2004
                                                          Non-Cash
                                                       Movements
                                              £                £                £
  Cash                                  328,718                -          328,718
  Short term deposits                 2,275,152                -        2,275,152
                                         --------        ---------       ----------

                             Total    2,603,870                -        2,603,870
                                         ========        =========       ==========


  30 June 2005                       Cash Flows            Other   30 June 2005
                                                          Non-Cash
                                                       Movements
                                              £                £                £
  Cash                                   48,097                -           48,097
  Short term deposits                 2,218,446                -        2,218,446
                                         --------        ---------        ---------

                             Total    2,266,543                -        2,266,543
                                         ========        =========        =========




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