Griffin Mining Regulatory News (GFM)

8th Floor, 54 Jermyn Street, London, SW1Y 6LX. United Kingdom

Telephone: + 44 (0)20 7629 7772 Facsimile: + 44 (0)20 7629 7773

E mail: griffin@griffinmining.com

7th August 2018

INTERIM STATEMENT

for the six months ended 30th June 2018

Griffin Mining Limited ("Griffin" or "the Company") has today released its unaudited results for the six months ended 30th June 2018.

Highlights:

· Revenues of $54.1 million

· Operating profit of $21.1 million

· Profit before tax of $21.3 million

· Profit after tax of $15.3 million

· Basic earnings per share 8.95 cents

Financial and Trading:

The first six months of 2018 has seen falling zinc metal prices only marginally impacting profitability whereas higher grade gold areas have resulted in record gold in concentrate production in the first six months of the year. Operations at Caijiaying were maintained with minimal disruption throughout the first half of 2018.

In the six months to 30th June 2018, 448,530 tonnes of ore were processed to produce:

· 16,873 tonnes of zinc;

· 459 tonnes of lead;

· 132,689 ounces of silver; and

· 9,492 ounces of gold.  

Zinc revenues before royalties and resource taxes in the six months to 30th June 2018 were $42,573,000 with 16,881 tonnes of zinc metal in concentrate sold with an average price received after smelter charges of $2,522 per tonne. Lead and precious metals revenues were $14,045,000 with more gold in concentrate sold offset by lower silver in concentrate sold.

During the six months to 30th June 2018:

· 400,167 tonnes of ore were mined;

· 437,734 tonnes of ore were hauled; and

· 448,530 tonnes of ore were processed.

Cost of sales of $23,336,000 in the first six months of 2018 was up on that incurred in 2017 of $20,820,000. This in the main reflects additional costs incurred extracting ore from greater depth and backfilling waste material and tailings to minimise surface storage of tailings.

Administration expenses (including those of the Caijiaying site) have risen from $8,061,000 in the first six months of 2017 to $9,663,000 in 2018. This includes fees to the Group's Chinese partners, of $2,186,000 (2017 $2,111,000); equivalent to their equity interest of 11.2% of Hebei Hua Ao's profits. Administration costs within China have increased with higher fees and costs in dealing with stricter environmental, health and safety regulations and in applying for the mining licence over Zone II. At the beginning of 2018, Griffin's wholly owned Hong Kong subsidiary, China Zinc Ltd, engaged a corporate development manager to identify potential areas and projects of interest in China.

Basic earnings per share were 8.95 cents (2017: 8.85 cents). At 30th June 2018, attributable net assets per share amounted to 119 cents (2017: 91 cents).

Cash flows from operations in the period have been directed at paying down outstanding creditors and further development of the Caijiaying Mine.

On 11th July 2018 the Company's Chinese operating subsidiary, Hebei HuaAo Mining Industry Co Ltd ("Hebei Hua Ao") completed the most important phase in the granting of the new mining licence over Zone II of the Caijiaying Zinc-Gold Mine ("Zone II"). On 11th July 2018 a legally binding contract was signed with the Hebei Department of Land and Mineral Resources, as authorised by the Beijing Ministry of Natural Resources, pursuant to the Interim Administrative Regulation for Proceeds Collection from the Transfer of Mineral Rights (2017). Hebei Hua Ao has become the first company to proceed under this newly promulgated regulation governing the transfer and conversion of mining tenements. Hebei Hua Ao will be prioritized in its final documentation approvals for the conversion of the exploration licence over Zone II into a mining licence in compliance with relevant national policies.

With cash flows from operations now directed towards the development of the Zone II area at Caijiaying and in line with previous years' practice of determining annual dividends at the time of the Company's full year results, no interim dividend has been declared by the Board of Griffin.

Chairman's Statement

Chairman Mladen Ninkov commented, "This is a wonderful result in light of the 21% fall in the zinc since the beginning of the year. The second half of the year will remain challenging if commodity prices remain subdued. However, the recent signing of the Contract of Transfer and the progress towards the issue of the new Mining Licence over Zone II, sets the stage for an exciting 2019." 

Griffin Mining Limited

Mladen Ninkov - Chairman Telephone: +44(0)20 7629 7772

Roger Goodwin - Finance Director

Panmure Gordon (UK) Limited Telephone: +44 (0)20 7886 2500

Dominic Morley

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014

Griffin Mining Limited's shares are quoted on the Alternative Investment Market (AIM) of the London Stock Exchange (symbol GFM).

The Company's news releases are available on the Company's web site: www.griffinmining.com

Griffin Mining Limited

Condensed Consolidated Income Statement

(expressed in thousands US dollars)

Griffin Mining Limited

Condensed Consolidated Statement Of Comprehensive income

(expressed in thousands US dollars)

Griffin Mining Limited

Condensed Consolidated Statement Of Financial Position

 (expressed in thousands US dollars)

Griffin Mining Limited

Condensed Consolidated Statement of Changes in Equity

(expressed in thousands US dollars)

Griffin Mining Limited

Condensed Consolidated Cash Flow Statement

 (expressed in thousands US dollars)

Griffin Mining Limited

Notes to the Interim Statement

1. These unaudited condensed consolidated interim financial statements have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year to 31 December 2017.

2. This interim report will be available on the Company's web site, www.griffinmining.com. Hard copies are available from the Company's London office, 8th Floor, Royal Trust House, 54 Jermyn Street, London. SW1Y 6LX.

3. The summary accounts set out above do not constitute statutory accounts as defined by Section 84 of the Bermuda Companies Act 1981 or Section 434 of the UK Companies Act 2006. The condensed consolidated statement of financial position at 31 December 2017 and the condensed consolidated income statement, condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity and the condensed consolidated cash flow statement for the year then ended have been extracted from the Group's 2017 statutory financial statements upon which the auditors' opinion is unqualified.

4. The summary accounts have been prepared on a going concern basis. Having considered the cash resources, banking facilities and forecasts for the remainder of the Hebei Hua Ao joint venture term, the directors do not expect any going concern issues to arise.

5. The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. The calculation of diluted earnings per share is based on the basic earnings per share on the assumed conversion of all dilutive options and other dilutive potential ordinary shares. Reconciliation of the earnings and weighted average number of shares used in the calculations are set out below: