Final Results

Celtic Resources Holdings PLC
23 June 2003



 CELTIC ANNOUNCES AGREEMENT TO ACQUIRE BALANCE OF NEZHDANINSKOYE GOLD MINE AND
                  PRE TAX PROFITS OF US$2.32 MILLION FOR 2002


Financial Highlights


• Pre tax profit up US$2 million to US$2.32 million

• First year of profit after tax and earnings per share of US4.2 cents

• Net asset value increased from US$20 million to US$42.2 million


Nezhdaninskoye Gold Mine, Russia (50%)


• Share swap deal to increase Celtic's ownership of Nezhdaninskoye gold
mine to 100%

• IG Alrosa, a subsidiary of Russia's Alrosa, the world's second largest
diamond producer will become a 23% shareholder of Celtic in return for 50% of
the shares in Nezhdaninskoye

• Alrosa will offer a project loan of US$20million

• Deal expected to close in summer subject to legal documentation, due
diligence, government and shareholder approvals


Suzdal Gold Mine, Kazakhstan (100%)


   •Poured 37,176 ounces of gold at total costs of US$169/ounce
   •Sulphide project started with a combination of open pit and underground
    mining to produce at 100,000 oz/year rate by late 2004


Zherek Gold Mine, Kazakhstan (75%)


   •First gold poured June 2003, from 2000 tonne per day open pit and heap
    leach, five months after construction started at capital cost of US$1.5
    million
   •Expected production this year of 20,000 ounces of gold


Please find Chairman's statement and financial results accompanying this
highlights page. The company's annual report and accounts will be distributed to
shareholders this week and available shortly thereafter on our Web site.


For more information please contact:

Kevin Foo / Kate Dexter Smith               Cindy Dennis
Celtic Resources Holdings Plc               Capital PR, London
Tel: + 44 (0) 20 7593 0001                  Tel: + 44 (0) 20 7618 7887
[e-mail]            [e-mail]
----------------------------------          ---------------------

Joe Nally / David Newton
Williams de Broe
Tel: [phone]
[e-mail]
-----------------------
                                            www.celticresources.com
                                            -------------------------



CHAIRMAN'S STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2002


Fellow shareholders,


In June 2002 I was pleased to accept the appointment as Chairman of the Board of
Celtic Resources Holdings when it was decided that it was appropriate to split
this function from the position of Managing Director, which Kevin Foo retains.


In last year's letter to shareholders we declared our key target and I reaffirm
that it remains:


"To grow into a profitable, resources based company with an attractive portfolio
of producing and developing mines and hydrocarbon properties in Russia and
Central Asia".


For the year to 31 December 2002, Celtic has reported a pre tax profit in excess
of US$2.32 million, which is a very gratifying result. This is the second
consecutive year that we have declared a pre tax profit and after tax, our
profit was $890,000.


I will take this opportunity to review the progress we have made towards
achieving our targets and to indicate what our plans are for the future.


As you know, we operate in the Former Soviet Union, an area of rapidly growing
economic activity that offers unmatched opportunities in the resources industry
as is evidenced by major capital commitments from western resources companies.


We believe that we are in a very special situation, with over 11 years operating
experience in the region and a management team that continues to demonstrate the
ability to find, develop and operate successful resource projects at very low
cost. This is the driving force of the company and has been responsible for our
rapid growth over the last three years.


In 2002, we continued to make progress through asset acquisition and building
gold production.



Kazakhstan


Our primary objective in Kazakhstan continues to be to increase gold production
to more than 100,000 oz/year by end 2004. The development of the Suzdal sulphide
ores and the acquisition of the Zherek gold mine should help to achieve this
objective. We will also seek to build our gold reserve base by acquisitions.


Suzdal Gold Mine


In 2002, Celtic increased its ownership in Suzdal to 100% because we believe in
the outstanding potential of this mine. Gold production from the oxide heap
leach last year was 37,176 ounces. Ore mined was 232,880 tonnes at 5.7g/t Au and
ore agglomerated and stacked was 346,744 tonnes at 4.3g/t Au. Gold was produced
at a total cost of $169/oz.


The sulphide project has been the focus of an in-house study that detailed plans
to increase Suzdal production to 100,000 oz/year by late 2004. Diamond drilling
of the ore bodies and assessment of data by Celtic and its consultants has
confirmed the Suzdal reserve at some 5.2 million tonnes, averaging 9g/t Au
(containing some 1.5 million ounces). Mining will be a combination of open pit
and underground.


The Suzdal sulphides are classified as refractory and the primary process route
will consist of crushing, grinding, flotation and bacterial oxidation. Bacterial
oxidation has been used successfully at several mines to liberate gold from
sulphide ores and our test work indicates that overall gold recoveries will be
80-85%. Cash operating costs are estimated to be approximately $170/ounce.


The expected capital cost of this project is now US$21 million and the finance
necessary to exploit the rich sulphide ores has been agreed with Narodny Bank in
Kazakhstan.



Zherek Gold Mine


In November 2002, we acquired a 75% interest in Zherek LLP. This company owns
the 675,000-ounce Zherek mine, approximately 28 km from Suzdal. This mine was
acquired with long-term finance from Bank Centre Credit OJSC of Kazakhstan.
Zherek has Russian quantified resources of 2 million tonnes of oxide ores
averaging 2.8g/t Au and sulphide ores estimated at 2.8 million tonnes at 5.5g/t
Au.


I hope that you are as delighted as the board in acknowledging the outstanding
achievement of our Kazakhstan operating team. They have started this mine, built
and commissioned a 2000tpd agglomeration and heap leach facility in less than 5
months, for a total capital outlay of $1.5 million. Furthermore, the first gold
from Zherek has been poured this month and planned production for 2003 is
approximately 20,000 ounces.


Shorskoye Molybdenum Project


We have a 65% interest in this project. Preliminary drilling and resource
estimates have indicated that Shorskoye, a massive molybdenum porphyry in
stockwork, could be one of the largest deposits of its type in the world.
Tonnages and grades for the main zone are estimated at 315 million tonnes
averaging 0.24% molybdenum oxide. Limited drilling over last summer confirmed
grades in the main zone and further drilling and test work is planned.


Other Properties


The assessment of our other exploration properties in Kazakhstan is continuing
and we are investigating a number of options for their development. We expect
plans to be finalised later this year.


                                  Oil and Gas


In Kazakhstan, we progressed well testing at the Tamdykol oil project and
evaluated additional oil opportunities sourced by members of our oil and gas
team. There was no commercial oil production at Tamdykol and the well test
results from the shallow deposits proved to be disappointing. However, further
seismic surveys were justified and are underway.


In our North Sea gas interests GDF Britain, a subsidiary of Gaz de France,
farmed into the licenses and is conducting a full data review with the aim of
identifying a drilling target by September 2003. This was an encouraging
development. Celtic has a 5% interest in this project at present.


Our oil and gas strategy is currently under review with a view to adding
shareholder value through mergers and acquisitions.





                                     Russia


Nezhdaninskoye Gold Mine


Nezhdaninskoye contains a 28 million ounce gold resource (including 13.9m oz
classified as measured, indicated and inferred to JORC standards) located in
Yakutia, northern Russia. In 2002, using some $12 million of shareholders funds
we completed the mine refurbishment, rebuilt a large part of the treatment plant
and rehabilitated the power and heating plants. We also acquired ownership of
mine assets on behalf of the South Verkhoyansk Mining Company (SVMC).
Furthermore, limited gold production was achieved during plant trials.


An operating plan was produced by the company and accepted by Standard Bank who
committed to a $12 million loan for the project, subject to due diligence and
approval by SVMC shareholders.


Increased Ownership of Nezhdaninskoye

In late 2002, it became clear to us and to our partners in SVMC that the 50/50
ownership of the mine, with Celtic funding 100% of the project was not workable.
Negotiations to seek a satisfactory solution were then held and preliminary
agreements were reached in early 2003 and negotiating teams established. Whilst
these negotiations were taking place, the mine was on standby and all necessary
operating licenses maintained by our partners.


I am pleased to report that we now have an agreement for Celtic to acquire the
other 50% of shares in SVMC. These will be obtained by issuing Celtic shares to
our Russian partners, Investment Group Alrosa (IGA). The net result of this all
share deal will be that Celtic will own 100% of Nezhdaninskoye and IGA will
become a significant shareholder in Celtic, with a 23% interest in the company
and will have the right to nominate two directors to the Celtic board. The
transaction will of course be subject to documentation, due diligence,
government and shareholder approvals and is expected to close over the summer.


Specifically, IGA will receive 5.12 million ordinary shares on closing,
representing about 13% of Celtic stock at present and a further 3.94 million
shares, approximately 10% of Celtic stock, six months after closing, subject to
certain milestones. IGA will also receive 7.58 million preferred shares, which
in 2010 will convert to 3.79 million ordinary shares. As part of the agreement,
IGA will also arrange a loan to SVMC of $20 million on terms agreeable to
Celtic.


I want to emphasise to shareholders the importance and great significance that
this transaction will have on Celtic. We will have 100% ownership of
Nezhdaninskoye, one of the world's largest gold mines and IG Alrosa will become
Celtic's largest shareholder. IGA is a subsidiary of AK Alrosa, the world's
second largest diamond producer. Its shareholder base includes the Russian
Federal Government and the Republic of Sakha (Yakutia) where Alrosa's diamond
mines and our Nezhdaninskoye mine are located. Celtic's policy is to maximize
the use of local resources and management at our operations and we are very
comfortable with this approach for Nezhdaninskoye.


The presence of a large Russian company backing Celtic will greatly enhance our
plans for the rapid development of Nezhdaninskoye and its surrounding
infrastructure. This will also open up the prospect of extending our interests
with a powerful and motivated partner and shareholder.






It is a very important fact that our Russian partner chose to become a
significant shareholder in Celtic in return for its interest in Nezhdaninskoye.
We feel that this association with IG Alrosa will also put Celtic in a strong
position to participate in the ongoing consolidation of the Russian gold
industry.





                                   Financial


The admission of Celtic shares to trading on AIM, with the accompanying placing
and open offer, was accomplished in October 2002. The process absorbed
considerable management time and effort, and was hampered by the uncertainties
in the markets that existed throughout 2002. We raised £5.04 million, which was
less than we had hoped for. However, I would remind shareholders of our
outstanding growth over the last three years. In late 1999 when Kevin Foo took
the helm, we had a market capitalisation of about £0.5 million and currently it
is approximately £50 million.


Early in 2003, we completed a private placing at £1.10 per share with Deutsche
Bank AG London, Special Situations Group, which raised some $4.7 million.



The Future


Our specific plans for 2003-4 are to:


-          Develop the sulphide deposits at Suzdal with a mine production target
of 100,000 oz/year of gold by end 2004.

-          Develop Zherek gold mine to full production at a planned annual rate
of 50,000 ounces by 2005.

-          Bring Nezhdaninskoye into production with an initial target through
2004 of 45,000 ounces.

-          Continue to add to our gold reserves and production capabilities.

-          Add value to our hydrocarbon assets.


We believe that the acquisition of the other 50% of the Nezhdaninskoye gold mine
will represent a major milestone in Celtic's history. After a very successful
three years of rebuilding, Celtic is now a profitable gold producer with a 30
million ounce resource base. With this very large asset, activities in both
Russia and Kazakhstan, a respected management and board, strategic partners and
shareholders such as Alrosa, we are in a strong position to take advantage of
the current low valuations placed on resource assets in the FSU to build a major
company with significant cash flows.


                                     Thanks


As usual, without the unstinting efforts of all within the company, none of the
above would be possible and I thank our employees at the mines and regional
offices.

I should particularly like to thank our shareholders for their loyal and patient
support of the company and our Board for their efforts over the last year.


Yours sincerely,



Peter Hannen

Chairman


Celtic Resources Holdings Plc audited results for the year ended 31 December
2002



CONSOLIDATED PROFIT AND LOSS ACCOUNT

FOR THE YEAR ENDED 31 DECEMBER 2002

                                                             2002         2001
                                                             $000         $000

Turnover - acquisitions                                     9,272           --

Cost of sales - acquisitions                               (4,105)          --
                                                           --------     --------
Gross profit - acquisitions                                 5,167            -
                                                           --------     --------

Administrative expenses - continuing operations             2,387        1,350
- acquisitions                                                813          103
                                                           --------     --------
                                                            3,200        1,453
                                                           --------     --------

Operating profit/( loss) - continuing operations           (2,387)      (1,350)
- acquisitions                                              4,354         (103)
                                                           --------     --------
                                                            1,967       (1,453)

Share of associated company's profit before tax               349        1,792

Loan interest payable                                         (52)         (32)

Interest receivable                                            60           27
                                                           --------     --------
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION               2,324          334

Taxation                                                   (1,434)        (596)
                                                           --------     --------
PROFIT/(LOSS) AFTER TAXATION                                  890         (262)

Minority interest                                               -           26
                                                           --------     --------
Retained Profit/(Loss) of the group                           890         (236)
                                                           --------     --------

Earnings per share

Profit/(loss) per share                                   $0.0426     $(0.0002)
                                                           --------     --------

Fully diluted profit/(loss) per share                     $0.0413     $(0.0002)
                                                           --------     --------





CONSOLIDATED BALANCE SHEET

AS AT 31 DECEMBER 2002

                                                              2002        2001
                                                              $000        $000
FIXED ASSETS
Intangible assets                                           41,119      20,148
Tangible assets                                              5,508       1,954
Financial assets                                                 2         899
                                                            --------    --------
                                                            46,629      23,001
                                                            --------    --------

CURRENT ASSETS
Stock                                                        1,901         120
Debtors                                                      4,250       2,199
Cash at bank and in hand                                     2,433         943
                                                            --------    --------
                                                             8,584       3,262

Creditors: (amounts falling due within one year)           (10,911)     (6,285)
                                                            --------    --------
Net current liabilities                                     (2,327)     (3,023)

Creditors: (amounts due after more than one year)           (2,148)          -
                                                            --------    --------
Net Assets                                                  42,154      19,978
                                                            --------    --------


Financed by:

CAPITAL AND RESERVES
Called up share capital - equity                         6,716           3,910
- non equity                                             3,184           3,184
Capital conversion reserve                                  61              61
Share premium - equity                                  38,234          19,677
Profit and loss account - equity                        (9,891)        (10,459)
                                                         -------        --------
Shareholders' funds                                     38,304          16,373

Minority interest - equity                               3,850           3,605
                                                         -------        --------
                                                        42,154          19,978
                                                         -------        --------




CONSOLIDATED CASHFLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2002

                                                    Notes       2002      2001
                                                                $000      $000
                                                              --------
NET CASH INFLOW FROM OPERATING ACTIVITIES
                                                     (a )      4,222     2,311
                                                              --------  --------

RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received                                                 60        27
Interest paid                                                 (1,197)      (20)
Dividends received                                                 -       585
                                                              --------  --------
NET CASH (OUTFLOW)/INFLOW FROM RETURNS ON
INVESTMENTS AND SERVICING OF FINANCE
                                                              (1,137)      592
                                                              --------  --------

TAX PAID                                                      (1,434)      (96)
                                                              --------  --------

CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT

Payments to acquire intangible fixed assets                  (14,858)   (7,602)
Proceeds on disposal of tangible assets                          160        90
Payments to acquire tangible fixed assets                     (2,181)   (1,746)
Purchase of subsidiary undertakings                           (2,208)   (1,000)
                                                              --------  --------
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE AND                (19,087)  (10,258)
FINANCIAL INVESTMENT                                          --------  --------
                                                                        --------
NET CASH OUTFLOW BEFORE FINANCING                            (17,436)   (7,451)
                                                              --------  --------

FINANCING

Issue of ordinary share capital                               22,999     5,578
Costs associated with shares issued during the                (2,059)     (224)
year                                                          --------  --------
                                                              20,940     5,354
Loan received                                                      -     2,598
Loans repaid                                                  (2,208)     (640)
                                                              --------  --------
NET CASH INFLOW FROM FINANCING                                18,732     7,312
                                                              --------  --------
                                                              --------  --------
INCREASE/(DECREASE) IN CASH                          (b)       1,296      (139)
                                                              --------  --------



NOTES TO CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2002



(a)  Reconciliation of operating loss to net cash inflow/       2002      2001
     (outflow) from operating activities
                                                                $000      $000

     Operating profit/(loss)                                   2,351    (1,453)
     Depreciation and fixed asset write down                   1,775        61
     Decrease/(increase) in stocks                               480       (97)
     (Increase)/decrease in debtors                             (887)    1,628
     Increase in creditors                                       580     1,940
     Exchange movements                                          (77)       38
                                                               -------   -------
                                                               4,222     2,311
                                                               -------   -------


(b)   Analysis of net funds
                                At 2001    Acquisition    Cash flow    At 2002
                                   $000           $000         $000       $000

      Cash in hand and at           943            193        1,296      2,433
      bank

      Debt due within 1 year     (2,208)             -        2,208          -
                                 --------     ----------    ---------  ---------
                                 (1,265)           193        3,504      2,433
                                 --------     ----------    ---------  ---------





(c)    Reconciliation of net cash flow to movement              2002      2001
       in net funds                                             $000      $000

       Increase/(decrease) in cash in the period               1,296      (139)
       Cash inflow/(outflow) from increase/(decrease) in       2,208    (1,958)
       debt                                                    -------   -------
       Change in net funds resulting from cash flows           3,504    (2,097)
       Cash inflow on acquisition of subsidiary                  194         -
                                                               -------   -------
       Movement in net funds in the period                     3,698    (2,097)
       Net funds at start of year                             (1,265)      832
                                                               -------   -------
       Net funds at end of year                                2,433    (1,265)
                                                               -------   -------







                      This information is provided by RNS
            The company news service from the London Stock Exchange