Ariana Regulatory News (AAU)

29 September 2023

AIM: AAU

INTERIM RESULTS

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed mineral exploration and development company with gold mining interests in Europe, is pleased to announce its unaudited interim results for the six months ended 30 June 2023.

Financial Highlights:

· Ariana's share of profits from the Kiziltepe Mine, of which Ariana owns 23.5% through its investment in Zenit Madencilik San. ve Tic. A.S. ("Zenit"), in the six months to June 2023 amount to £0.7m (H1 2022: £2.5m), largely reflecting the increase in administrative and other project costs associated with the development of the Tavsan Mine.

· Zenit has fully repaid all bank loans within the period and continues to finance the Tavsan mine construction from its own internal funds. Zenit also absorbed the additional cost of the Tavsan site operational and administrative functions. 

· Profit before tax of £0.3m was recorded for the period, with operating costs in line with expectations and the prior year, though the decline (38% at the reporting date) in Turkish Lira facilitated a large foreign exchange charges and a corresponding reduction in other comprehensive income.

Operational Highlights:

· Drilling continues at the Salinbas project with two drill rigs, with several highly significant results announced within the period, including the first discovery holes drilled at the Hizarliyayla prospect.

· New geophysical survey results from Kiziltepe and Kepez highlighted several new drilling targets in the proximity of known veins systems, which are the subject of further investigation through drilling.

· Western Tethyan completes agreement to acquire the Slivova Gold Project in Kosovo, and post-period end provided a resource update (0.18Moz) and a positive Preliminary Economic Assessment. 

· Kiziltepe Mine production for H1 2023 achieved 9,646 ounces of gold (H1 2022: 13,378 ounces of gold) with annual guidance of c.18,000 ounces of gold expected to be met by year-end.

· Construction of the Tavsan Mine was temporarily halted in March 2023 following a local court decision, which was reversed shortly after the period end to enable construction to recommence.

· Three new 100%-owned licences were acquired as part of our Project Leopard greenfield exploration initiative in eastern Turkey.

Strategic Highlights:

· WH Ireland was appointed as joint broker to the Company alongside Panmure Gordon.

Significant Post-Period End Highlights:

· Venus Minerals has advanced well during Q3 2023 and the planned IPO is currently scheduled for Q4 2023.

· Positive results were announced from an airborne magnetic survey and the commencement of drilling at Kizilcukur, with the utilisation of the Geotek BoxScan technology in building the revised 3D model.

Dr. Kerim Sener, Managing Director, commented:

"Looking back over the past six months, we have conducted significant operational activity, as highlighted above, which underscores the huge amount of work being undertaken across our projects. We have remained committed to our strategy to pursue targeted exploration and development programmes across our portfolio, systematically de-risking our pipeline of robust assets, and propelling them up the value curve. Some of our assets will continue to be held in significant partnerships, while others are intended in the long-term to be developed largely independently of Ariana, such as Venus Minerals and Western Tethyan Resources. In addition, new project opportunities are being assessed via our Asgard Metals Fund, which may contribute markedly to the upscaling of our overall portfolio.

Our own team and Zenit have been working exceptionally hard to advance the projects in Turkey through multiple drilling programmes, geophysics, surface sampling and geological mapping. Specifically, these efforts culminated in a series of highly encouraging drilling results from the Salinbas Project, including the longest mineralised intercept ever recorded within the Ardala Cu-Au-Mo Porphyry of 461.8m @ 0.22% Cu + 0.23g/t Au and 155ppm Mo. In addition, the team successfully drilled the first three holes into the Hizarliyayla prospect, located 9km to the south of Salinbas, and identified an intermediate sulphidation epithermal base-metal-rich gold system. Although the prospective economic target is likely to be deep, from 600m below surface, the mineralisation lies along strike of the Hot Maden deposit and within the same structural corridor. This is an exciting development, as the area represents the most technically and operationally complex exploration ever undertaken by our team and is the subject of further deep drilling for which assay results will be available in due course.

Meanwhile, our operations in western Turkey continue to advance as planned, albeit having suffered somewhat from a five-month temporary suspension of construction activities at the Tavsan Mine following a local court decision. This delay was unfortunate as our local partnership had to maintain a construction team on stand-by and incur the associated continuing administrative costs on the Tavsan mine build. We were appreciative of the relatively swift resolution in our favour, allowing the team to immediately recommence construction early post-period end. Supporting all this activity was our operating Kiziltepe Mine, which continued to perform exceptionally throughout the period. Recent drilling activities at Kiziltepe and surrounding prospects remain, with a further round of drilling planned to follow the results of a new geophysical survey, which has identified several untested targets in the vicinity of known veins. We are hopeful that additional mineable ounces will be discovered to enable Kiziltepe to remain operational as we transition into full-scale operations at Tavsan in the forthcoming year. Kiziltepe remains an important operational base, with its commercial laboratory and metallurgical testwork facilities which will continue to support the activities of Zenit in the years ahead as the partnership continues to develop its projects in Turkey.

Further afield, our broader exploration activities remain focused on the discovery of new multi-million-ounce gold and copper projects, among other project types. Our strategic exploration alliance with Newmont Mining Corporation is going from strength to strength as activities with Western Tethyan Resources in Kosovo are accelerating markedly. This has created the impetus to recommence our own greenfield exploration in eastern Turkey after a hiatus of over 10 years, a strategy which crystallised following the grant of our first new exploration licences within an area we have designated "Project Leopard". In support of this project, we have engaged with technical experts in the geology and mineral prospectivity of this region through various academic institutions, including Middle East Technical University and the Centre for Exploration Targeting at the University of Western Australia, who are assisting with the generation of target areas for follow-up regional exploration through the application of some innovative ideas and techniques.

It is particularly interesting to note the development of BHP Xplor, a project accelerator fund, established by the world's leading mining company, to diversify its interests across commodities and jurisdictions with a particular focus on discovery-stage opportunities. This development is a response to the conundrum of ever-increasing demand for commodities, particularly those that support the growth of renewable energy technologies, set against the dearth of exploration success over the last few decades. As ever, Ariana has shown itself to be ahead of the curve, having established its own accelerator fund, in the form of Asgard Metals, a year ahead of this much-needed initiative by BHP. Our activities in this area have been undertaken in the background compared to our other projects, but significant effort has been placed into this division of the business, largely going underneath the radar. The team is currently working on a potential project which has the capacity to become a significant opportunity for the Company, for which details will be provided as soon as we are able.

We look forward to providing Company updates for the second half of the financial year, as we continue to operate an exciting pipeline of projects in gold and copper within Southeast Europe and as we look to grow our portfolio further afield."

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").

Condensed Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2023

Condensed Consolidated Interim Statement of Financial Position

For the six months ended 30 June 2023

Condensed Consolidated Interim Statement of Changes in Equity

For the six months ended 30 June 2023

Condensed Consolidated Interim Statement of Cash Flows

For the six months ended 30 June 2023

Notes to the interim financial statements

For the six months ended 30 June 2023

1. General information

Ariana Resources Plc (the "Company") is a public limited company incorporated, domiciled and registered in the U.K. The registration number is 05403426 and the registered address is 2nd Floor, Regis House, 45 King William Street, London, EC4R 9AN.

The Company's shares are listed on the Alternative Investment Market of the London Stock Exchange. The principal activities of the Company and its subsidiaries (together the "Group") are related to the exploration for and development of gold, and technology-metals.

2 (a). Basis of preparation

The condensed interim financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards and in accordance with International Accounting Standard 34 Interim Financial Reporting.  The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2022, which have been prepared in accordance with UK-adopted international accounting standards.

The condensed interim financial statements set out above do not constitute statutory accounts within the meaning of the Companies Act 2006. They have been prepared on a going concern basis in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) as adopted by the UK. Statutory financial statements for the year ended 31 December 2022 were approved by the Board of Directors on 5 June 2023. The financial information for the periods ended 30 June 2023 and 30 June 2022 are unaudited.

2 (b). Significant accounting policies

The same accounting policies have been followed in these condensed interim financial statements as were applied in the preparation of the Group's financial statements for the year ended 31 December 2022.

These financial statements have been prepared on a going concern basis. The Directors are mindful that there is an ongoing need to monitor overheads and costs associated with delivering on its strategy and certain exploration programmes being undertaken across its portfolio.

3. Administrative costs and other gains

During the period, exchange gains on holding US Dollars are disclosed within the charge for administrative costs.

Gold bullion acquired during the period is included under current assets at its market valuation. Any resulting gain or loss on revaluation is recognised through the profit or loss in the statement of comprehensive income.

4a. Exploration assets

The Group, through its two subsidiary companies hold several exploration licences in Kosovo and Türkiye.

Expenditure including a proportion of staff costs capitalised during the period is as follows: -

4b Earn In advances

The Group's 75% owned subsidiary Western Tethyan Resources Limited ("WTR"), entered into an Earn-in Agreement with Avrupa Minerals Limited, for the right to acquire up to an 85% interest in the Slivova Gold Project in Kosovo. The agreement requires WTR to provide funding and complete a series of exploration and development milestones, ahead of reaching its agreed ownership target. Staged payments and development expenditure incurred following inception of the option to the 30 June 2023 amounted to £227,000.

5. Equity accounted Investments

The Group investments comprise the following:

5 (a). Investment in Zenit

The Group accounts for its associated interest in Zenit using the equity method. As at 30 June 2023 the Group retained a 23.5% interest in Zenit.

Summarised financial information, based on Zenit's translated financial statements, and reconciliations with the carrying amount of the investment in the consolidated financial statements are set out below:

5 (b). Investment in Pontid

The Group accounts for its associated interest in Pontid using the equity method. As at 30 June 2023 the Group retained a 23.5% interest in Pontid. This investment continues to be valued at £4.139m as at 30 June 2023.

5 (c). Investment in Venus

The Group increased its shareholding in Venus Minerals Ltd to 58% from 50% during May 2023. The Group continues to account for its increased interest using the equity method. The Group`s share of loss for the period to 30 June 2023 amounted to £91,000.

6. Segmental analysis

Management currently identifies one division as an operating segment - mineral exploration. This operating segment is monitored and strategic decisions are made based upon this and other non-financial data collated from exploration activities.

Principal activities for this operating segment are as follows:

- Mineral exploration - incorporates the acquisition, exploration and development of gold resources.

- Other reconciling items include non-mineral exploration costs and transactions between Group and associate companies.

Geographical segments

The Group's mining assets and liabilities are located primarily in Türkiye.

7. Taxation

The Group had taxable profits for the period and a corporation tax charge is anticipated during the year to 31 December 2023. The charge reflected in these interim accounts is based on the following transactions:

8. Earnings per share on continuing operations

The calculation of basic profit per share is based on the profit attributable to ordinary shareholders of £119,000 divided by the weighted average number of shares in issue during the period, being 1,146,363,330.

9. Financial assets at fair value through profit or loss

10. Trade and other receivables

The fair value of trade and other receivables is not materially different to the carrying values presented.

11. Called up share capital, share premium and capital reduction reserve

At 30 June 2023 the Company had no outstanding options and warrants for the issue of ordinary shares.

12. Approval of interim financial statements

The interim financial statements were approved by the Board of Directors on 29 September 2023.

Contacts:

Editors' Note:

About Ariana Resources:

Ariana is an AIM-listed mineral exploration and development company with an exceptional track-record of creating value for its shareholders through its interests in active mining projects and investments in exploration companies. Its current interests include gold production in Turkey and copper-gold exploration and development projects in Cyprus and Kosovo.

The Company holds 23.5% interest in Zenit Madencilik San. ve Tic. A.S. a joint venture with Ozaltin Holding A.S. and Proccea Construction Co. in Turkey which contains a depleted total of c. 2.1 million ounces of gold and other metals (as at February 2022). The joint venture comprises the Kiziltepe Mine and the Tavsan and Salinbas projects.

The Kiziltepe Gold-Silver Mine is located in western Turkey and contains a depleted JORC Measured, Indicated and Inferred Resource of 222,000 ounces gold and 3.8 million ounces silver (as at February 2022). The mine has been in pro?table production since 2017 and is expected to produce at a rate of c.20,000 ounces of gold per annum to at least the mid-2020s. A Net Smelter Return ("NSR") royalty of 2.5% on production is being paid to Franco-Nevada Corporation.

The Tavsan Gold Mine is located in western Turkey and contains a JORC Measured, Indicated and Inferred Resource of 307,000 ounces gold and 1.1 million ounces silver (as at November 2022). Following the approval of its Environmental Impact Assessment and associated permitting, Tavsan is being developed as the second gold mining operation in Turkey. A NSR royalty of up to 2% on future production is payable to Sandstorm Gold.

The Salinbas Gold Project is located in north-eastern Turkey and contains a JORC Measured, Indicated and Inferred Resource of 1.5 million ounces of gold (as at July 2020). It is located within the multi-million ounce Artvin Gold?eld, which contains the "Hot Gold Corridor" comprising several signi?cant gold- copper projects including the 4 million ounce Hot Maden project, which lies 16km to the south of Salinbas. A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation.

Ariana owns 100% of Australia-registered Asgard Metals Fund ("Asgard"), as part of the Company's proprietary Project Catalyst Strategy. The Fund is focused on investments in high-value potential, discovery-stage mineral exploration companies located across the Eastern Hemisphere and within easy reach of Ariana's operational hubs in Australia, Turkey and the UK.

Ariana owns 75% of UK-registered Western Tethyan Resources Ltd ("WTR"), which operates across south-eastern Europe and is based in Pristina, Republic of Kosovo. The company is targeting its exploration on major copper-gold deposits across the porphyry-epithermal transition. WTR is being funded through a ?ve-year Alliance Agreement with Newmont Mining Corporation (www.newmont.com) and is separately earning-in to 85% of the Slivova Gold Project.

Ariana owns 58% of UK-registered Venus Minerals Ltd ("Venus") which is focused on the exploration and development of copper-gold assets in Cyprus which contain a combined JORC Indicated and Inferred Resource of 17Mt @ 0.45% to 1.10% copper (excluding additional gold, silver and zinc.

Panmure Gordon (UK) Limited and WH Ireland Limited are brokers to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.

For further information on Ariana, you are invited to visit the Company's website at www.arianaresources.com.

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