Final Results

For immediate release: COPPER RESOURCES CORPORATION PLC ("Copper Resources" or the "Company") FINANCIAL STATEMENT FOR THE PERIOD ENDED 31 DECEMBER 2006 Copper Resources Corporation Plc (AIM: CRC), the minerals and mining company, today announces its audited results for the year ended 31 December 2006. CHAIRMAN'S REPORT For the Period Ended 31 December 2006 Dear Shareholders: In the last 18 months Copper Resources Corporation ("CRC" or the "Company") laid the basis for bringing into production its three projects by achieving important milestones as follows: * Kinsenda Restart Project (Democratic Republic of Congo, "DRC"): An independent bankable feasibility study ("BFS"), was completed in June 2007 by Mineral Engineering Technical Services Pty Ltd (METS). The BFS shows compelling project economics with an IRR to CRC estimated at 52% and an NPV (10%) estimated at US$124 million based on a long-term copper price of US$1.30 per pound. At higher copper prices, the financial returns to CRC increase significantly. The average total cash operating cost is estimated to be a very low 71 US cents per pound of copper. Operations are expected to commence in mid-2008. * Hinoba-an Project (Philippines): IMC Mining Solutions Pty Ltd ("IMC") was engaged to manage the completion of a BFS. In order to achieve a minimum mine life of 15 years, infill drilling at the A1 deposit has been recommended to bring it into the BFS programme. Recommendations also include additional infill drilling on the south side of the DJ deposit, as well as additional drilling to identify the potential of supergene enriched copper ore. A new scoping study will be completed, which will determine the scope of the infill drilling programmes and help formulate the content of the BFS, in order to optimise project parameters, such as mining and milling throughput rates to maximise project return. The scoping study is expected to require approximately four months to complete and the BFS an additional 18 months, including the new infill drilling. There exists the potential for mining higher grade ore with a lower strip ratio in the earlier years of the mine which would be extremely beneficial to the return on the project. Discussions are ongoing with international natural resource companies regarding a potential joint venture for development of the Hinoba-an project. CRC is very encouraged by the interest shown to date. * The Haib Project (Namibia): Laboratory-scale test work confirmed that the Haib ore reacts positively to the application of a dense media separation process. In addition, a new scoping study points to a 50% reduction in capital costs compared to earlier studies (previously estimated to be US$700 million), as well as lower operating costs. With the encouraging results achieved in the scoping study, CRC will embark on a full-scale pilot scale test work programme. * Funding: The Company continued to receive strong investor support and successfully completed two equity raisings. In March 2006 the Company placed 8,000,000 new units with investors at a price per unit of 55 pence (US$0.97) for total proceeds of £4.4 million (US$7.7 million). Each unit consisted of one common share plus one-half of one warrant exercisable over a two-year period at a strike price of 75 pence. The Forrest Group also agreed that US$5.3 million of its loan out-standing to MMK would be assigned to CRC and converted to equity on terms identical to the unit placing. In February 2007, the Company placed 10,000,000 new common shares with investors at 77 pence (US$1.50) per share for total proceeds of £7.7 million (US$15 million). The Forrest Group also agreed that US$7.5 million of its loan out-standing to MMK would be assigned to CRC and converted to 5,025,873 common shares on terms identical to the equity placing. The Kinsenda project BFS estimates that the total financing required, including capital cost, working capital and financial charges during construction, will be approximately US$93 million. This amount is expected to be funded with US$36.4 million from CRC, of which US$10 million was provided to MMK in April-May 2007, and the remainder will be provided to MMK as a loan subordinated to project loans. RMB Resources has approved a project loan in the amount of US$32 million and has expressed interest in arranging and providing an expanded facility of US$56 million. This means that CRC will have to seek further funding to complete the project. The next 18 months also promise to be very eventful with significant expected developments, including: * Progress on restarting the Kinsenda Mine and becoming a significant DRC copper producer; * Embarking with work on the Musoshi mine and exploration at the Lubembe property and at the new exploration target at Kinsenda; * Progress on the Hinoba-an bankable feasibility study; * Evaluation of the Haib pilot scale test work; and * Completion of the management strengthening process currently underway. We would like to express our appreciation to the management and staff for their hard work and our shareholders for their continued support. Sincerely Sir Sam Jonah Mitchell Alland George A. Forrest Chairman Executive Vice Chairman Vice Chairman 29 June 2007 FINANCIALS Consolidated income statement for the year ended 31 December 2006 Notes 2006 2005 $'000 $'000 Revenue 11,740 - Cost of sales (11,932) - Gross loss (192) - Interest receivable and similar 6 158 298 income Unrealised foreign exchange gain 661 78 Administrative expenses (4,195) (1,449) Share based transactions (243) (1,559) Other write offs - (435) Loss on ordinary activities before 3 (3,811) (3,067) taxation Income tax expense 7 - - Minority interest 722 1 Loss for the financial year (3,089) (3,066) Loss per share Basic 8 (5.4c) (13.6c) All results derive from continuing activities There were no recognised gains and losses other than those included in the consolidated income statement. Consolidated balance sheet as at 31 December 2006 Notes 2006 2005 $'000 $'000 Assets Non-current assets Property, plant and equipment 9 6,941 5,526 Development, exploration and 10 37,820 26,478 evaluation costs Available for sale investments 12 200 200 44,961 32,204 Current assets Inventories 15 7,483 5,422 Trade and other receivables 17 4,487 2,300 Other current assets 16 - - Cash and cash equivalents 18 1,334 11,565 13,304 19,287 Total assets 58,265 51,491 Equity and liabilities Equity attributable to equity holders of the parent Issued capital 23 42,969 30,365 Share premium 2,817 2,817 Other reserves 736 1,576 Retained earnings (7,062) (3,973) 39,460 30,785 Minority interests 3,582 4,304 Total equity 43,042 35,089 Non-current liabilities Other liabilities 20 475 475 Borrowings 21 - 354 Total non-current liabilities 475 829 Current liabilities Trade and other payables 19 7,059 5,110 Other liabilities 20 150 150 Borrowings 21 7,539 10,313 Total current liabilities 14,748 15,573 Total liabilities 15,223 16,402 Total equity and liabilities 58,265 51,491 Company balance sheet as at 31 December 2006 Notes 2006 2005 $'000 $'000 Assets Non-current assets Property, plant and equipment 9 2 3 Investment in subsidiaries 13 14,434 14,434 Available for sale investments 12 200 200 14,636 14,637 Current assets Loans to subsidiaries 14 27,536 6,008 Trade and other receivables 17 3 16 Cash and cash equivalents 18 43 8,857 27,582 14,881 Total assets 42,218 29,518 Equity and liabilities Shareholders' equity Share capital 22 42,969 30,365 Other reserves 1,802 1,559 Retained earnings (3,832) (3,267) 40,939 28,657 Non-current liabilities Deferred purchase consideration 20 475 475 Total non-current liabilities 475 475 Current liabilities Loans from subsidiaries 14 218 218 Trade and other payables 19 436 18 Deferred purchase consideration 20 150 150 Total current liabilities 804 386 Total liabilities 1,279 861 Total equity and liabilities 42,218 29,518 The financial statements were approved by the Board on the 28th June 2007 and authorised for issue. Consolidated cash flow statement for the year ended 31 December 2006 2006 2005 $'000 $'000 $'000 $'000 Cash flows from operating activities Loss from operations (3,969) (3,364) Adjustments for: Share based transactions 243 1,559 Depreciation on property, plant and 722 13 equipment Operating cash flows before movement in (3,004) (1,792) working capital Change in inventories (2,061) - Change in receivables (2,187) (1,814) Change in payables 1,949 5,218 Net cash used in operations (2,299) (3,404) Corporation tax paid - - Net cash used in operating activities (5,303) (5,196) Cash flows from investing activities Interest received 158 298 Acquisition of subsidiaries - (12,914) Cash acquired in acquisition of subsidiary - 2,454 companies Investment in exploration costs (11,342) (4,763) Investment in associates - (200) Purchase of property, plant and equipment (2,137) (217) Net cash used in investment activities (13,321) (14,942) Cash flows from financing activities Share capital issued (net of costs) 12,604 30,355 Loans repaid (3,128) - Net cash generated from financing activities 9,476 30,355 Effect of exchange rate changes on cash (1,083) - Net (decrease)/increase in cash and cash (10,231) 10,217 equivalents Cash and cash equivalents at beginning of 11,565 1,348 period Cash and cash equivalents at end of period 1,334 11,565 Company cash flow statement for the year ended 31 December 2006 2006 2005 $'000 $'000 $'000 $'000 Cash flows from operating activities Loss from operations (565) (3,267) Depreciation 1 - Share based transactions 243 - Operating cash flows before movement in (321) (3,267) working capital Increase in receivables (21,515) (5,806) Increase in payables 418 18 Cash used in operations (21,097) (5,788) Corporation tax paid - - Net cash used in operating activities (21,418) (9,055) Cash flows from investing activities Acquisition of subsidiary - (15,223) Acquisition of associate - (200) Acquisition of property, plant and equipment - (3) Net cash used in investment activities - (15,426) Financing activities Share capital issued (net of costs) 12,604 33,338 Net cash from financing activities 12,604 33,338 Net (decrease)/increase in cash and cash (8,814) 8,857 equivalents Cash and cash equivalents at beginning of 8,857 - period Cash and cash equivalents at end of period 43 8,857 Notes to the financial statements For the year ended 31 December 2006 1. Presentation of financial statements The nature of the group's operations and its principal activities are set out in the Directors' Report on pages 7 to 10. The financial statements have been prepared in accordance with International Financial Reporting and Accounting Standards ("IFRS") adopted by the European Union and therefore comply with Article 4 of the EU IAS Regulation. At the date of authorisation of these financial statements, there were Standards and Interpretations that were in issue but are not yet effective and have not been applied in these financial statements. The directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the financial statement of the group or company, except for additional disclosures when the relevant Standards come into effect. 2. Significant accounting policies Basis of accounting The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, events or actions, actual results ultimately may differ from those estimates The financial statements have been prepared on the historical cost basis. The principal accounting policies adopted are set out below. Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and enterprises controlled by the Company (its subsidiaries) made up to 31 December each year. Control is achieved where the Company has the power to govern the financial and operating policies of a subsidiary. On acquisition and when control is achieved, the assets and liabilities and contingent liabilities of a subsidiary are measured at their fair values at the date of acquisition or at the date control is achieved. Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired is recognized as goodwill. Minority interests in the net assets of consolidated subsidiaries are identified separately from the group's equity therein. Minority interests consist of the amount of those interests at the date of the original business combination and the minority's share of changes in equity since the date of the combination. Losses applicable to the minority in excess of the minority's interest in the subsidiary's equity are allocated against the interests of the group except to the extent that the minority has a binding obligation and is able to make additional investment to cover the losses. Basis of consolidation (continued) The results of subsidiaries acquired or disposed of during the period are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. All intercompany transactions and balances between group enterprises are eliminated on consolidation. The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured at the aggregate of the fair values, at the acquisition date, of assets given, liabilities incurred or assumed, and equity instruments issued by the group, plus any costs directly attributable to the acquisition. The acquiree's identifiable assets, liabilities and contingent liabilities are recognised at their fair value at the acquisition date, except for non-current assets that are held for resale, which are recognised and measured at fair value less costs to sell. Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of cost over the group's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised of a subsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill is recognised as an asset and is tested for impairment annually, or on such occasions that events or changes in circumstances indicate that its value might be impaired. On disposal of a subsidiary, the attributable amount of unamortised goodwill, which has not been subject to impairment, is included in the determination of the profit or loss on disposal. If the group's interest in the net fair value of a subsidiary's or joint venture's assets, liabilities and contingent liabilities exceeds cost of the business combination, the excess after any adjustment for fair value ("negative goodwill") is recognised in the income statement immediately. Investment in associates An associate is an entity over which the group is in a position to exercise significant influence, but not control or jointly control, through participation in the financial and operating policy decisions of the investee. Significant influence is the power to participate in the financial and operating policy decisions of the investee but not control or joint control over these policies. The results and assets and liabilities of associated are incorporated in these financial statements using the equity method of accounting except when classified as held for sale. Investments in associates are carried in the balance sheet at cost as adjusted by post-acquisition changes in the group's share of net assets of the associate, less any impairment in the value of individual investments. Losses of the associate in excess of the group's interest in those associates are not recognised. Any excess of the cost of acquisition over the group's share of the fair values of the identifiable net assets of the associate at the date of acquisition is recognised as goodwill. Where the company transacts with an associate of the group, profits and losses are eliminated to the extent of the group's interest in the relevant associate. Losses may provide evidence of an impairment of the asset transferred in which case appropriate provision is made for impairment. Revenue recognition Sales revenue is accrued on an invoice basis as and when copper is shipped. Interest income is accrued on a time basis, by reference to the principal outstanding and the interest rate applicable. Leasing Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Assets held under finance leases are recognised as assets of the group at their fair value or, if lower, at the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the balance sheet as finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the group's general policy on borrowing costs. Rentals payable under operating leases are charged to income on a straight-line basis over the term of the relevant lease. Benefits received and receivable as an incentive to enter into an operating lease are also spread on a straight-line basis over the lease term. Borrowing costs All borrowing costs are recognised in the income statement in the period to which they are incurred. Taxation The tax charge represents the sum of current and deferred tax. Current tax payable is based on taxable profits for the year. Taxable profits may differ from net profits as reported in the income statement because it excludes items that are taxable or deductible in other years and items that are not taxable or deductible. The group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the balance sheets date. Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the liability method. Deferred tax liabilities are recognised for all temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which temporary differences can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability or the asset is realised. Foreign currency translations Fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the close rate. Transactions in currencies other than US Dollars are recorded at the rates of exchange prevailing on the dates of the transactions or translated at the average exchange rates for the period. Exchange differences resulting from the settlement of transactions denominated in foreign currency are included in the statement of income using the exchange rate ruling on that date. Transactions occurring in a subsidiary of Hinoba Holdings, were denominated primarily in Philippine Pesos. Management is of the opinion that these operations were integrated foreign operations for purposes of foreign currency translation and, accordingly, the accounts have been translated into U.S. dollars. Transactions occurring in a subsidiary of MMK, were denominated primarily in Congolese Francs. Management is of the opinion that these operations were integrated foreign operations for purposes of foreign currency translation and, accordingly, the accounts have been translated into U.S. dollars. The consolidated financial information is presented in US Dollars, which is considered by management to be the most appropriate presentation currency for its consolidated financial information. All assets and liabilities are translated at the closing rate existing at the balance sheet date. Income and expense items are translated at an average rate for the period. Equity items other than the net profit or loss for the period that is included in the balance of accumulated profit or loss are translated at the closing rate existing at the balance sheet date. All translation differences are recognised in a component of Equity. Impairment At each balance sheet date, the group reviews the carrying amount of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs. If the recoverable amount of an asset is estimated to be less than its carrying amount, the impairment loss is recognised as an expense, unless the relevant asset is land or buildings at a revalued amount, in which case the impairment loss is treated as a revaluation decrease. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset. A reversal of an impairment loss is recognised as income immediately, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss treated as a revaluation increase. Impairment losses relating to goodwill are not reversed. Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Depreciation is charged so as to write the cost less residual value over estimated useful lives, using the straight-line method commencing in the month following the purchase, on the following basis: * freehold property 25 years * heavy equipment 4 - 10 years * plant and equipment 4 - 10 years The useful lives and residual values of assets are reviewed annually. Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, over the term of the lease. The gain or loss arising on the disposal of an asset including disposal costs is recognised in the income statement. Mineral exploration costs Expenditures for mineral exploration work prior to and subsequent to drilling are deferred as incurred. These shall be written off it the results of the exploration work are unsuccessful. If the results are successful, the deferred expenditures and the subsequent development cost will be capitalized and amortized from the start of commercial operations. Inventories Inventories are stated at the lower of cost and net realisable value. Net realisable value represents the estimated revenue less all estimated costs of completion and necessary selling costs. Financial instruments The carrying value of accounts receivable and accounts payable and accrued liabilities approximates fair value due to the relatively short term maturity of these instruments. Fair value represents the amount that would be exchanged in an arm's length transaction between willing parties and is best evidenced by a quoted market price. Fair value information about related party advances is not readily obtainable. Financial assets and financial liabilities are recognised in the group's and company's balance sheets when the group or company has become a party to the contractual provisions of the instrument. The Company follows the Black-Scholes option pricing model. Under this model, share-based payments are measured at the fair market at the date of grant. The fair value determined at the grant date is expensed to when options vest. Options vest immediately. Trade receivables Trade receivables are stated at their nominal value less allowances for irrecoverability. Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term deposits and liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. Bank borrowings Interest-bearing bank loans and overdrafts are recorded at the proceeds received, net of direct issue costs. Finance charges, including premiums payable on settlement or redemption and direct issue costs, are accounted for on an accruals basis in the income statement using the effective interest rate method Financial liabilities and equity Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that creates a residual interest in the assets of the group. Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Provisions Provisions are recognised when the group has a present obligation as a result of a past event from which it is likely that an outflow of economic benefits will occur which can be reasonably quantified. 3. Loss on ordinary activities 2006 2005 $'000 $'000 Loss on ordinary activities has been arrived at after charging: Auditor's remuneration 140 100 Depreciation of property, plant and equipment - owned assets 722 13 Staff costs (note 4) 780 358 Director's remuneration (note 5) 727 410 Auditor's remuneration for the audit of the company amounts to $60,000 (2005: $60,000) 4. Staff costs The costs of employing staff were: 2006 2005 $'000 $'000 Wages and salaries 3,457 1,563 Social security costs 612 265 4,069 1,828 No. No. The average number of employees during the period 780 358 was 5. Directors' remuneration Remuneration paid to directors during the period was as follows: 2006 2005 $'000 $'000 Salaries 727 410 The remuneration of directors and key executives is decided by the remuneration committee having regard to comparable market statistics. The directors consider the key management personnel to consist entirely of the directors and therefore, no additional disclosure has been made. The emoluments (including pension contributions) of the highest paid director were as follows: 2006 2005 $'000 $'000 Salaries 240 155 6. Interest receivable and similar income 2006 2005 $'000 $'000 Interest on bank deposits 158 298 7. Income tax expense The British Virgin Islands under the IBC imposes no corporate taxes or capital gains. However, the Company as a group may be liable for taxes in the jurisdictions where it is developing mining properties. The tax rates in the Philippines and the Congo are 40% and 32.5% respectively. There are currently tax losses amounting to $0.048 million in the Philippines and $2.9 million in the Congo. No reconciliation has been produced as there is no taxable revenue in the current year. 8. Loss per share The calculations of the basic and diluted loss per share are based on the following data: 2006 2005 $'000 $'000 Salaries (3,089) (3,066) Number of shares Weighted average number of ordinary shares 57,152,562 22,615,528 in issue during the year There were no dilutive instruments in place in the current and preceding years as defined by IAS33 `Earnings per share'. 9. Property, plant and equipment Group 2006 Freehold Heavy Plant and Total properties equipment equipment $'000 $'000 $'000 $'000 Cost At 1 January 2006 477 5,135 312 5,924 Additions 91 1,658 388 2,137 At 31 December 2006 568 6,793 700 8,061 Depreciation At 1 January 2005 11 348 39 398 Charge for the year 48 588 86 722 At 31 December 2006 59 936 125 1,120 Net book value At 31 December 2006 509 5,857 575 6,941 At 31 December 2005 466 4,787 273 5,526 Company 2006 Plant and Total equipment $'000 $'000 Cost At 1 January 2006 and at 31 December 2006 3 3 Depreciation At 1 January 2006 - - Charge for year 1 1 At 31 December 2006 1 1 Net book value At 31 December 2006 2 2 At 31 December 2005 3 3 Group 2005 Freehold Heavy Plant and Total properties equipment equipment $'000 $'000 $'000 $'000 Cost At 1 January 2005 - - 2 2 Additions 477 5,140 313 5,930 Disposals - (5) (3) (8) At 31 December 2005 477 5,135 312 5,924 Depreciation: At 1 January 2005 - - - - Charge for the year 11 348 39 398 At 31 December 2004 11 348 39 398 Net book value At 31 December 2005 466 4,787 273 5,526 At 31 December 2004 - - 2 2 Company 2005 Plant and Total equipment $'000 $'000 Cost At 1 January 2005 - - Additions 3 3 At 31 December 2005 3 3 Net book value At 31 December 2005 3 3 At 31 December 2004 - - 10. Development, exploration and evaluation costs Group 2006 2005 Cost $'000 $'000 At 1 January 2006 26,478 212 Additions 11,342 26,266 At 31 December 2006 37,820 26,478 At 31 December 2005 26,478 212 This relates to capitalised costs of exploration and development costs at the Group's Projects. 11. Investment in associated undertaking Group 2006 2005 $'000 $'000 Cost At 1 January 2006 - 78 Additions - - Disposals - (78) At 31 December 2006 - - This investment in associated undertaking related to Selenga Mining Corporation and the acquisition of the interest in Selenga by Hinoba Holdings Limited. 12. Available for sale investments Group and company 2006 2005 $'000 $'000 Cost At 1 January 2006 200 - Additions - 200 At 31 December 2006 200 200 This relates to the investment in Afri-Can Marine Minerals Corporation, which is a listed entity on the Toronto Stock Exchange. 13. Investments in subsidiary undertakings Company 2006 2005 $'000 $'000 Cost At 1 January 2006 14,434 - Acquisitions - 14,434 At 31 December 2006 14,434 14,434 All subsidiary companies are included in the consolidated accounts of CRC. At December 31, 2006, the Group had the following subsidiaries: Name of company Place of incorporation Ownership Principal interest activity Hinoba Holdings Australia 100% Secretarial & (Australia) Pty Administration Offices Limited* African Millennium British Virgin Islands 100% Mining Corporation* exploration Hinoba Holdings Ltd. Commonwealth of the 100% Holding company * Bahamas of Hinoba Holdings (Philippines), Inc. Hinoba Holdings Philippines 100% Holding company (Philippines), Inc. of Hinoba-an & Sipalay Holdings Hinoba-an & Sipalay Philippines 40% Holding company Holdings, Inc.# of Selenga Mining Corporation Selenga Mining Philippines 92.5% Mining Corporation exploration Miniere de Musoshi Democratic Republic of 75% Mining et Kinsenda sarl* Congo exploration * Held directly by CRC. # This company has two different share types, 40% being class A ordinary shares and 60% class B preferred shares. Hinoba Holdings (Phillipines), Inc ("HHPI") owns 100% of the class A shares and three directors of Hinoba-an & Sipalay Holdings Inc. own 100% of the class B shares. HHPI is a wholly owned subsidiary of Hinoba Holdings Ltd which is a wholly owned subsidiary of CRC. Hence, the Group has a 100% equity interest in the Company and it is consolidated accordingly. 14. Loans to subsidiaries Company 2006 2005 $'000 $'000 Within one year: At 1 January 2006 6,008 - Net Funds provided 21,528 6,008 At 31 December 2006 27,536 6,008 Loans from subsidiaries At 1 January 2006 218 - Funds advanced - 218 At 31 December 2006 218 218 The directors consider that the fair values of the loans outstanding are not materially different from their book values. The loans are interest free with no fixed-terms of repayment and are for the working capital required for each entity to perform its day to day activities. 15. Inventories Group 2006 2005 $'000 $'000 Raw materials 2,546 2,645 Wrappings 12 10 Work in progress 3,847 1,173 Finished products 957 1,369 Stocks in transit 121 225 7,483 5,422 16. Other current assets Group 2006 2005 $'000 $'000 At 31 January 2006 - 448 Additions - 2 Disposals - (450) At 31 December 2006 - - Other current assets relate to the Copper Spur property where CRC relinquished its rights thereto and wrote off the expenditure incurred. 17. Trade and other receivables Group Company 2006 2005 2006 2005 $'000 $'000 $'000 $'000 Trade receivables 4,472 2,286 3 16 Other taxes 15 14 - - 4,487 2,300 3 16 The average credit period taken on sales of services was 90 days (2005: 90 days). The amounts presented in the financial statements are net of allowances for doubtful receivables, estimated by the Group's management based on prior experience and their assessment of the current economic environment. The directors consider that the carrying amount of trade and other receivables approximates to their fair value. Credit risk The Group and Company have no significant concentration of credit risk, with exposure spread over a large number of counterparties. 18. Cash and cash equivalents Group Company 2006 2005 2006 2005 $'000 $'000 $'000 $'000 Cash at bank 1,334 11,565 43 8,857 Bank balances and cash comprise cash held by the Group and Company and short-term bank deposits with an original maturity of three months or less. The carrying value of these assets approximates their fair value. The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies. 19. Trade and other payables Group Company 2006 2005 2006 2005 $'000 $'000 $'000 $'000 Trade payables 6,604 4,842 436 18 Other payables and accruals 455 268 - - 7,059 5,110 436 18 20. Deferred purchase consideration Group Company 2006 2005 2006 2005 $'000 $'000 $'000 $'000 Deferred consideration 625 625 625 625 Description of deferred consideration maturity profile Group Company 2006 2005 2006 2005 $'000 $'000 $'000 $'000 Within one year 150 150 150 150 One - two years 150 150 150 150 Two - five years 325 325 325 325 625 625 625 625 21. Borrowings 2006 2005 $'000 $'000 EGMF - current 7,539 10,313 EGMF - non-current - 354 Net position at 31 December 2006 7,539 10,667 EGMF, an associated company of a current Shareholder and previous majority Shareholder of MMK, provided the Company with several amounts of financing through the company's Belgolaise account. The Loan is interest free. In February 2007 EGMF agreed to assign this loan to the Company and convert to equity at terms identical to the equity placing on the same date. 22. Share capital 2006 2006 2005 2005 $'000 Number of $'000 Number of Shares shares Authorised: Ordinary shares of no par value - 500,000,000 - 500,000,000 Called up, allotted and fully paid: Ordinary shares of no par value 42,969 60,594,191 30,365 46,794,335 (a) On 6 March 2006, options were exercised on 200,000 common shares of no par value at 0.25 cents for cash. (b) On 30 March 2006, the Company issued 8,000,000 common shares of no par value at $0.97 cents for cash with $565,000 financing costs. (c) On 30 March 2006 the Company issued 5,499,857 common shares of no par value at $0.97 cents in a debt for equity swap agreement with The Forrest Group in relation to its outstanding debt with MMK. (d) On 6 April 2006, options were exercised on 100,000 common shares of no par value at $0.25 cents for cash. (e) Option Plan The Company has established a share option scheme whereby the Directors may from time to time at their discretion grant to the directors, employees and consultants of the Group options to subscribe common shares. Under the plan, the exercise price of each option shall be the average of the middle market quotation for the thirty dealing days preceding the grant and the number of options may be granted is limited to 10 per cent of the total Common shares issued. An option is exercisable on the date it is granted and expires on the fifth anniversary of the grant date. The details of the changes in the number of stock options outstanding as at 31 December 2006 are shown in note 28. 23. Related party transactions a. Transactions between group companies are eliminated on consolidation and are not disclosed in this note. b. Included in Related Party Transactions were the issue of Options to Directors of Copper Resources Corporation. These are noted in Directors Remuneration. c) A transaction involving the issue of warrants to the Forrest Group as set out more fully in the Chairmans Statement was effected during March 2006. 24. Contingencies A Financial or Technical Assistance Agreement ["FTAA"] was filed jointly by HHPI and SMC in July 1995. Actual ground exploration work started in October 1996. In December 1996, all FTAA activities were stopped due to the uncertainty of the Philippine's government policies affecting FTAAs where the constitutionality of The New Mining Law was being questioned before the Supreme Court. Also, the government enacted Republic Act [RA] No. 8371, otherwise known as the Indigenous People Rights Act of 1997, which if implemented, would negate the traditional provision that all natural resources belong to the State and would adversely affect the local mining industry. The constitutionality of RA No. 8371 was also questioned before the Supreme Court whose decision rendered in January 2001 resulted in a deadlock. On February 1, 2005, the Supreme Court upheld its decision on December 1, 2004 declaring the Philippines Mining Act [RA No. 7942] of 1995 as constitutional. At February 28, 2005, all registered motions of reconsideration in relation to RA No. 8371 have been dismissed by the Supreme Court of the Philippines. 25. Royalty commitments On December 17, 2004, SMC entered into an Integrated Mining and Operating Agreement with Colet in order to rationalize and govern their relationship with respect to the mineral properties and consolidate the terms of the operating agreement dated December 7, 1991 and the Royalty Reduction Agreement dated December 8, 2003. Under the terms of the Integrated Mining and Operating Agreement SMC is committed to pay a 3% net benefit royalty to Colet in return for the possession, occupancy, use and enjoyment, for purposes of exploring, developing, equipping, mining and operating for production of the mineral properties in the Project. Further, SMC is committed to pay Colet an additional $48,000 upon the transfer of the MPSA to SMC, as referred to in Note 10. SMC is also committed to pay Colet $105,000 upon completion of the Bankable Feasibility Study. If the Bankable Feasibility Study is not completed by December 17, 2006, SMC shall pay Colet $52,500 upon demand, with the remaining $52,500 to be paid upon completion of the Bankable Feasibility Study. Within six months of commencing commercial operations, SMC has the option to reduce the 3% net benefits royalty to 2%. In consideration for reducing the royalty, SMC must pay to Colet $2,000,000. At the election of SMC, an amount up to $600,000 of the $2,000,000 payment can be satisfied by the issuance of common shares of the Listed Company. These 2% net benefits royalties may be bought out by SMC for $6,000,000 to be satisfied with cash of $4,000,000 and $2,000,000 by the issuance of common shares of the Listed Company. In the event that SMC buys out the remaining 2% net benefits royalties of Colet, then Colet shall be liable to repay SMC $1,000,000 out of the $2,000,000 advance paid in consideration of reducing the net benefits royalties to 2%. Colet is also entitled to 7.5 % of the outstanding par value capital stock of SMC. SMC is to advance to Colet the funds needed to pay for their subscriptions. This advance will reduce the future net benefit royalties owing to Colet. 26. Ultimate parent company Copper Resources Corporation is the Ultimate Parent Company. Copper Resources Corporation is registered in the Bahamas. Registered office: Craigmuir Chambers, P.O.Box 71, Road Town, Tortola, British Virgin Island Registered number 626550 27. Subsequent events In February 2007, the Company placed 10,000,000 new common shares with investors at 77 pence (US$1.50) per share for total proceeds of £7.7 million (US$15 million). Following completion of the private placement, CRC agreed with the Forrest Group to take an assignment of MMK's outstanding debt of US$7,539,900 to the Forrest Group in consideration for an issue of 5,025,873 new common shares at the placing price of US$1.50 per share. Following these share issues, the Forrest Group's interest reduces to 38.7% of the enlarged share capital of 75,670,065 common shares in issue. Under the AIM Rules the Forrest Group is a related party of the Company and the Independent Directors, having consulted with Nabarro Wells, the Company's nominated adviser, confirm that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned. On 15 March 2007, 50,000 options over shares in the Company were exercised at an option price of $1 per share. An independent bankable feasibility study ("BFS") was prepared on the Kinsenda Restart Project being undertaken by "MMK". The BFS estimates that the total financing required, including capital cost, working capital and financial charges during construction, will be approximately US$93 million and that operations will commence in mid-2008. CRC is considering financing options for the project, as set out in the Chairman's Statement. 28. Share options During the year ended 31 December 2006, the group had the following share options in issue: Options exercisable at 100 pence, expiring 21 October 2006 Beginning of year 400,000 Lapsed during the year (400,000) End of year - Options exercisable at 100 pence, expiring 21 April 2008 Beginning and end of year 208,175 Options exercisable at 59 pence, expiring 23 May 2010 Beginning and end of year 150,000 Options exercisable at 100 pence, expiring 4 April 2010 Beginning and end of year 320,000 Options exercisable at 42 pence, expiring 28 September 2010 Beginning and end of year 100,000 Options exercisable at 25 cents, expiring 19 January 2010 Beginning of year 375,000 Exercised during year (300,000) End of year 75,000 Options exercisable at 100 cents, expiring 13 February 2010 Beginning and end of year 1,325,000 Options exercisable at 75 pence, expiring 31 December 2010 Beginning and end of year 1,775,000 Options exercisable at 100 pence, expiring 25 October 2011 Granted during year 937,500 End of year 937,500 These options were issued to directors with vesting conditions as detailed in the directors' report. The fair value of the equity based share options granted are estimated at the date of grant using the Black Scholes Model taking into account the terms and conditions under which the options were granted. The following table lists the inputs to the model used for the options granted: Options Options Options Options Options Options expiring expiring expiring expiring expiring expiring 21 April 23 May 4 April 28 Sept 31 Dec 25 Oct 2008 2010 2010 2010 2010 2011 Dividend yield (%) - - - - - - Expected volatility (%) 63 63 63 63 63 63 Risk free interest rate 3.27 3.45 3.70 3.58 3.89 4.91 (%) Expected life of options (years) 5 5 5 5 5 5 Option exercise price 100 59 100 42 75 100 (p) 29. Warrants During the year ended 31 December 2006, the group had the following warrants in issue: Warrants exercisable at 75 pence, expiring 28 March 2008 Granted during the year 6,749,929 End of year 6,749,929 Warrants exercisable at 55 pence, expiring 28 March 2008 Granted during the year 120,000 End of year 120,000 30. Segmental analysis America Australia Asia Africa Consolidation Total adjustments US US US US US US $000 $000 $000 $000 $000 $000 2006 Revenue - - - 11,740 - 11,740 Operating loss (565) (12) (347) (3,045) - (3,969) Loss on ordinary (565) (12) (347) (2,165) - (3,089) activities before taxation Segment assets 42,217 2,929 15,704 31,559 (34,144) 58,265 Segment liabilities 1,278 846 16,147 34,876 (37,924) 15,223 Acquisition of - - 81 2,056 - 2,137 property, plant and equipment Depreciation expense 1 2 53 666 - 722 2005 Revenue - - - - - - Operating loss (3,564) (11) 215 (4) - (3,364) Loss on ordinary (3,267) (11) 215 (4) - (3,067) activities before taxation Segment assets 30,933 2,472 7,373 19,951 (9,238) 51,491 Segment liabilities 862 378 7,249 20,382 (12,469) 16,402 Acquisition of 3 45 100 5,782 - 5,930 property, plant and equipment Depreciation expense - - 6 7 - 13 These accounts have been posted to shareholders today and will be made available on the Company's website www.copperresources.com. Further Information: Copper Resources Nabarro Wells & Fox-Davies GTH Corporation Co. Limited Capital Limited Communications Mitchell Alland Hugh Oram Richard Hail Toby Hall Executive Vice Chairman +44 (0) +44 (0) +44 (0) 207 936 +44 (0) 5200 78 7569 5563 20 7710 7400 20 7153 8035

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