Interim Results

Brancote Holdings PLC 22 November 2000 Date 22 November 2000 Contact Richard Prickett, Chairman Brancote Holdings PLC 020 7493 1002 David Bick / Chris Steele Holborn Public Relations 020 7929 5599 david.bick@holbornpr.co.uk chris.steele@holbornpr.co.uk Brancote Holdings PLC ('Brancote') Interim Statement and Offer for Sale of shares in HPD Exploration Plc ('HPD') Key Points * Results from Phase II drilling at the 60%-owned Esquel Gold Project in Argentina, commenced in the first half, defined the resource to be in excess of 2.45m ounces of gold and 5.4m ounces of silver. Phase III drilling commenced in September producing further outstanding results * Discussions entered into in early November with selected multinational mining companies which may or may not lead to an offer for Brancote * All remaining Brancote assets, other than the Esquel Gold Project, to be transferred into a newly formed subsidiary, HPD, which will be the subject of an Offer for Sale. Brancote is seeking to dispose of all of the issued share capital of HPD, being 62,885,037 Ordinary shares, which are initially being offered to Qualifying shareholders at 1.5p per share. The pro rata entitlement of each Qualifying Shareholder is 1 Ordinary Share for each Brancote share held. The net proceeds of the Offer accruing to Brancote are estimated to be £826,500 * The most significant asset of HPD will be a 35% interest in Landore Resources Inc, a precious and base metal exploration company in North America Commenting on the future, Richard Prickett, Chairman of Brancote, said: 'Our priority in the months ahead is to complete Phase III drilling on the Esquel Gold Project and to extend the resource estimate, while continuing our discussions with major mining companies. We also look forward to beginning the process of creating shareholder value in HPD, a new company which will develop the remaining Brancote assets.' Chairman's Statement The Company's progress can be summarised as follows: * August 2000 - Results from the Phase II drilling programme carried out in the first half of 2000 took the resource defined on the 60 per cent. owned Esquel Gold Project to in excess of 2.45 million ounces of gold and 5.4 million ounces of silver. * October 2000 - Phase III drilling, commenced in mid-September, continues to produce outstanding results further expanding the Galadriel Sur resource, down dip and south along strike towards the Julia-Elena vein systems. * November 2000 - The Directors announced they had entered into discussions with a select number of multi-national mining companies which may or may not lead to an offer for the Company. These discussions are at an early stage and the other options available to the Company are continuing to be examined. Full details of the Company's activities have been summarised in press releases, which are also available on our website www.brancote.com. The financial results for the period showed a loss of £688,118 (1999 £27,966). We have also announced today the offer for sale of shares in HPD Exploration Plc (HPD), a newly-formed subsidiary. We have arranged for all the Company's assets, other than our 60 per cent. interest in Minera El Desquite SA (the Esquel Gold Project) to be transferred to HPD, the most significant of these being our 35 per cent. interest in Landore Resources Inc. The Directors believe it will be simpler to conclude our strategic review with these assets transferred outside the Company. In addition, this will enable shareholders who participate in the HPD Offer to have a continuing interest in the future growth of the transferred assets. Full details are set out in the prospectus of HPD which has today been sent to shareholders together with these results. Our main priority in the coming months is to complete the Phase III drilling programme on the Esquel Gold Project and to extend the resource estimate. We will also be continuing our discussions with the mining companies and shareholders will be informed of progress in due course. RICHARD O PRICKETT Chairman Brancote Holdings PLC Unaudited Consolidated Profit and Loss Account For the six months ended 31 July 2000 Thirteen Six Six months months months ended ended 31 ended 30 31 January July 2000 June 1999 2000 £ £ £ Turnover 7,508 982,542 2,107,449 Cost of sales (1,194) (780,094) (1,943,144) Gross profit 6,314 202,448 164,305 Administrative expenses (326,283) (208,867) (517,077) Amortisation of goodwill (61,944) - - Exploration costs - (41,691) (73,679) Operating loss (381,913) (48,110) (426,451) Profit on sale of investments - 21,374 24,428 Amounts written off investments (340,461) - (1,671,363) Interest payable - (14,115) (405) Interest receivable 32,728 12,885 34,113 Loss on ordinary activities before (689,646) (27,966) (2,039,678) tax Minority interests 1,528 - 40,698 Taxation - - - Retained loss for the period (688,118) (27,966) (1,998,980) Loss per share (pence) (1.11p) (0.08p) (4.23p) Statement of Total Recognised Gains and Losses Six Six Thirteen months months months ended 31 ended 30 ended July June 31 January 2000 1999 2000 £ £ £ Loss attributable to shareholders of (688,118) (27,966) (1,998,980) Brancote Holdings PLC Unrealised exchange rate movements 234,550 (524,688) 314,184 Unrealised gain on investment 232,017 - - Total recognised losses for the period (221,551) (552,654) (1,684,796) Brancote Holdings PLC Unaudited Consolidated Balance Sheet At 31 July 2000 At 31 At 30 At 31 January July 2000 June 1999 2000 £ £ £ FIXED ASSETS Intangible fixed assets - deferred exploration costs 4,815,979 673,948 3,306,337 - goodwill 2,415,810 - 2,477,754 Tangible fixed assets 60,723 217,292 60,515 Investments - 951,334 703 7,292,512 1,842,574 5,845,309 CURRENT ASSETS Stock - 777,110 - Investments 730,333 - - Debtors 407,177 164,714 413,444 Cash at bank and in hand 3,383,517 1,212,064 1,474,912 4,521,027 2,153,888 1,888,356 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR (187,952) (606,214) (177,337) NET CURRENT ASSETS 4,333,075 1,547,674 1,711,019 TOTAL ASSETS LESS CURRENT LIABILITIES 11,625,587 3,390,248 7,556,328 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR - (366,059) - Provision for liabilities and - (71,999) - charges 11,625,587 2,952,190 7,556,328 CAPITAL AND RESERVES Called up share capital 3,144,250 2,186,428 2,974,740 Share premium account 13,982,799 6,212,603 10,673,327 Special reserve 720,000 720,000 720,000 Profit and loss account (8,091,195) (6,166,841) (7,869,844) EQUITY SHAREHOLDERS' FUNDS 9,755,854 2,952,190 6,498,223 Minority interest 1,869,733 - 1,058,105 CAPITAL EMPLOYED 11,625,587 2,952,190 7,556,328 Notes: This report is prepared on the basis of the accounting policies set out in the most recent set of annual financial statements. The report was approved by the Board of Directors on 22 November 2000. The comparative figures for the financial period ended 31 January 2000 are not the group's statutory accounts for that financial year. Those accounts have been reported on by the group's auditors and delivered to the registrar of companies. The report of the auditors was unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. No interim dividend is being declared. Copies of the interim statement are being sent to shareholders.

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