Final Results

Celtic Resources Holdings PLC
19 June 2006


                          Celtic Resources Holdings Plc
                ("Celtic", "Celtic Resources", or "the Company")
                                        
             Full year results for the year ending 31 December 2005


   • Group gold production in 2005 was 37,991 ounces compared to 31,809
     ounces in 2004, an increase of 14.9%.

   • Interest in the Nezhdaninskoye gold mine in Russia sold for $80 million
     cash.

   • Gold poured from the first BIOX(R) plant for treatment of refractory
     gold ores in the FSU.

   • Underground mining started at Suzdal.

   • Shareholders' funds increased during 2005 from $94.8 million to $111.5
     million.

   • Group loss before tax and minority interests was $260,000 including
     $1.27 million loss on foreign exchange movement.

   • Celtic has an investment portfolio with a 14.1% holding in Eureka Mining
     Plc and a 5.6% holding in Victoria Oil & Gas Plc.

The Company's annual report and accounts are being sent to shareholders and will
be available on our website shortly.


For further information please contact:

Kevin Foo / Kate Dexter Smith           Leesa Peters / Laurence Read
Celtic Resources Holdings Plc           Conduit PR
Tel: + 44 (0)20 7921 8800               Tel: [phone]              
[e-mail]           Tel: [phone]      
                                        [e-mail]

Frank Moxon
Williams de Broe Plc
Tel: [phone]

                             www.celticresources.com




CHAIRMANS STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2005


DEAR SHAREHOLDERS

The past 18 months has been a period of intense corporate activity for
Celtic while management has also been focused on bringing the newly developed
underground mine and BIOX(R) plant at Suzdal in Kazakhstan up to its full
capacity.

We started 2005 by engaging in a tripartite agreement with Barrick Gold
Corporation and IG Alrosa which was outlined in my letter to you in the last
Report and Accounts published in June 2005. These negotiations, involving three
companies from three different countries and cultures trying to create a major
new Russian gold group were complex and often frustrating.

In July 2005, we were also defending ourselves in a substantial arbitration in
London brought by Arduina Holdings BV. The result, which I reported to you in
December, was that we had won on every issue, completely vindicating our
position.

On 8 September, when writing to you to cover the interim accounts, it was
pointed out that recent Russian press articles hinted at other potential suitors
for the Nezhdaninskoye and Kyuchus assets, which were in our tripartite
agreement. On 19 September, we informed you that IG Alrosa had sold its Yakutian
gold interests including 50% of SVMC to ZAO Polyus, the gold mining arm of MMC
Norilsk Nickel and that we looked forward to discussing developments with them.
On 6 October, we issued a detailed statement concerning our 50% ownership of the
SVMC assets and how we had re-initiated legal proceedings in Russia and the
British Virgin Islands to protect them.

The Company and its legal advisers initiated over sixty legal actions. Although
the share price reacted very unfavourably to our position, the Company was able
to place a block of shares with Altima Group to raise $10 million which ensured
we could take the legal battles to a conclusion. On 23 November, we issued a
release concerning an illegal SVMC shareholders meeting that had been held on 18
November and we followed this up on 24 November stating that we had won an
important case on 8 November, restating our aim to proceed through the correct
legal channels to advance our cause.

The Company's position and determination was clear and during this period and
despite many provocations your small dedicated teams in London and in Moscow
never lost heart. They maintained a thoroughly professional attitude and refused
to give ground to much larger opponents by developing innovative strategies.
They were, and are, a great credit to themselves and to the shareholders. We
continued to negotiate with Polyus and after some time, a deal to sell our
interest in SVMC was proposed. After consideration the Board decided unanimously
to accept this as being in the best interests of the shareholders. This was
announced after the financial year end in
a lengthy release dated 3 February.

In this letter I am pleased to confirm that we have received the entire proceeds
of that transaction, $80 million, and we await to be repayment of a substantial
portion of our original loans to SVMC. We also expect to collect the costs
awarded to us for the Arduina case of approximately £1 million.

Whilst this is not the outcome I anticipated or wished for I believe that it is
a very good result for the Company and a substantial return on our investment. I
believe that current market conditions offer excellent opportunities to those
with gold production, expertise and cash.


KAZAKHSTAN

Whilst all the corporate activity was keeping your Board fully occupied, early
production results from the new BIOX(R) plant at Suzdal were disappointing and
the Board moved to strengthen management and pay very close attention to
increasing production and gold recovery. We are pleased to report that the newly
appointed management, led by Ross Calnan, has solved most of the problems
encountered and has developed a solid plan which should see the plant achieve
its full potential. Last year production was 20,585 ounces and I feel confident
that the forecast of more than 64,000 ounces for 2006 is achievable.

This substantial processing and mining facility was in part funded by local bank
borrowings which were shown in the interims as $24.3 million. Current borrowings
are $22.7 million and the Board will consider whether this should be repaid in
part or in full given the relative funding costs and available sources of
capital. At Zherek, heap leaching of oxide ores led to production of 17,406
ounces of gold and we forecast a similar level for this year.

The Company remains unhedged but as gold production rises and if prices remain
firm, the Board will, in conjunction with its advisers, continue to review
forward hedging strategies for gold and currencies.


FINANCIAL RESULTS

It is encouraging that turnover rose 15.3% last year to $15.7 million on the
back of increased gold sales and higher prices. However, I am disappointed to
report that due to an increase in fuel, labour, power and mill reagent costs and
an extended plant commissioning period, operating costs rose by 39.6%.
Therefore, after three years of profitability, I have to report an operating
loss of $0.21 million compared to an operating profit of $4.98 million in 2004,
although I would note that the result included a loss of $1.27 million on
foreign exchange movements, without which the group would have maintained
profitability at the operating and pre-tax levels. The net result was a loss of
$1.92 million compared to a profit of $2.80 million. Cash held at the end of
2005 totalled $10.5 million and after share issues in the year, group
shareholders'funds rose to $111.5 million from $94.8 million.


INVESTMENTS

Eureka Mining Plc

Celtic holds 3.74 million shares in AIM quoted Eureka Mining Plc. The shares
represent a 14.1% holding in Eureka and the current market value of this holding
is approximately £3 million.

Eureka had a successful 2005 and met all of its targets. In January 2005 it
announced the 51% acquisition of Urals based Chelyabinsk Copper Gold project in
Southern Russia and the purchase of the remaining 49% has since been completed.
In Kazakhstan during July 2005 Eureka signed a joint venture partnership with
KazAtomProm regarding the molybdenum mine at Shorskoye. A plant has since been
commissioned to process the output and is producing its first concentrates.
Eureka also raised £9 million via a placing with institutional investors in
September 2005.


Victoria Oil & Gas Plc

Celtic holds 6.40 million shares in AIM quoted Victoria Oil & Gas Plc. The
shareholding represents a 5.6% holding in Victoria and the current market value
of this holding is approximately £7 million. During 2005, Victoria made
outstanding progress towards its goal of becoming an established oil and gas
producer including two acquisitions and the raising of over $35 million in the
capital market.

Further to the acquisition of the Kemerkol oil project in Kazakhstan, which has
35 million barrels of C1 and C2 reserves and which began production at over 200
barrels of oil per day in March 2006, Victoria secured the outstanding 25.2% of
the potentially giant West Medvezhye gas and condensate project in Western
Siberia.

In the third quarter of 2005, the first exploration well was completed at West
Medvezhye and using data from the drilling and subsequent seismic work
independent reserve auditors DeGolyer & MacNaughton have confirmed gross
potential recoverable prospective resource volumes for the project of 5.6
trillion cubic feet of gas and over 164 million barrels of liquid hydrocarbons.
Victoria is currently testing this initial discovery well and drilling two
further wells with preliminary test results for each expected soon.

Celtic's interest in the two companies is represented by Kevin Foo's positions
as Non Executive Chairman on the Eureka Board of Directors and Chairman
of Victoria.


THE FUTURE

Our Company has emerged from a difficult few years with a substantial cash
balance, a growing production profile, proven experience in the FSU and a
management team that has shown its great abilities in all aspects of the
business. We are now ready to move into a second phase of Company development
where our gold resource base will be rebuilt, gold production increased,
acquisitions completed and associations forged.

I should like to thank my fellow Directors and all management and staff for
their outstanding efforts in 2005.


Peter Hannen
Chairman
16 June 2006



MANAGING DIRECTORS REVIEW OF OPERATIONS
FOR THE YEAR ENDED 31 DECEMBER 2005

Following the sale of our interest in the Nezhdaninskoye gold mine in Russia,
Celtic now has two operating gold mines in Kazakhstan, significant investments
in Eureka Mining and Victoria Oil & Gas, and $80 million cash. The Company
remains focused on gold production in the FSU and is actively reviewing
opportunities in the region, from its home base in Kazakhstan. Our medium term
aims are to rebuild gold resources to previous levels of approximately
10 million ounces and to increase production, by expansion and acquisition, to
500,000 ounces per year.


KAZAKHSTAN GOLD MINES

The Suzdal gold mine is located 75 km south-west of Semipalatinsk in northern
Kazakhstan. Open pit mining of oxides ceased in August 2004 and in that same
month, underground development by trackless mining to access the Sulphide ores
began. The Suzdal Sulphide Project, a treatment plant using state of the art
BIOX(R) technology was developed to extract gold from the refractory sulphide
ores. Commissioning of the mills and concentration circuit began in November
2004. Construction was essentially handled in house, using local design
institutes and contractors, except for the BIOX(R) plant, which required
specialist designs from the process supplier, Goldfields Ltd. First gold was
poured at the new plant in May and 2005 full year production reached 20,585
ounces. I am pleased to report that the first tonne of gold (31,103 ounces) was
recently poured from the Suzdal Sulphide plant.

At the nearby Zherek mine, 75% owned by Celtic, the open pit and heap leach
operation on oxide ores produced 17,406 ounces of gold.


SUZDAL GOLD MINE

Underground mine development continued on three levels and stoping began with
full year mined production reaching 40,215 tonnes at an average grade of 15.64g/
t of gold. This was below forecast due to equipment downtime and some complex
geological structures that had not been anticipated. Underground drilling has
enabled a much better understanding of the detailed geology and has materially
assisted in mine stope design and this programme is continuing. In addition,
stripping of waste from Pit 4 allowed access to sulphides from this orebody and
resource tonnages available are 250,000 tonnes at 8g/t Au. Currently,
underground production levels are at over 20,000 tonnes per month and to date
some 150,000 tonnes of ore has been mined from Pit 4, usefully supplementing
plant feed.

The crushing, grinding, flotation and filtration sections of the new plant were
completed prior to the BIOX(R) circuit and some gold in concentrates was sold in
the first half of 2005. The BIOX(R) plant, CIL circuit and gold elution
facilities, including two fully lined tailings dams and a cyanide detoxification
plant began production in May.

However, for most of 2005 and in the early part of 2006, production was severely
restricted because of limitations to the amount of concentrate which could be
fed to the BIOX(R) plant. This was primarily caused by the continued failure of
the western supplied air blowers. These are a critical component of the BIOX(R)
plant that supplies air to the oxidation tanks. All five blower units have been
replaced, some twice and after extensive internal and external expert analysis,
the primary cause of the problem has been traced to a design fault in the
blowers and air ducting to the tanks.

In late 2005, the Company decided to completely redesign and replace the blowers
with two large, more robust units and these will be in operation in August.
Until then, repaired units have sufficed and production levels have increased.
It is particularly pleasing that despite these teething problems, which included
wide fluctuations in feed quality and quantity, as well as ambient temperatures
sometimes minus 45degreesC, the "bugs" in the BIOX(R) plant have survived and
efficiently consumed whatever feed was available.

The plant now has the capacity to treat 300,000 tonnes of ore per year but on a
monthly basis has not reached this operating level due to the limitations
mentioned above and grinding circuit throughput problems that have since been
overcome. At present, monthly throughput is averaging 20,000 tonnes per month
against a budget of 25,000 tonnes per month, recovery is approximately 69%
against budget of 75% and feed grade average for the year to date is 9g/t Au
against budget of 11 g/t Au. We expect to be meeting or exceeding budget
production after the new blowers are installed and gold production for 2006 is
forecast to be 64,216 ounces.

In the final analysis, designing and constructing a major expansion such as the
Suzdal Sulphide Project has proved to be challenging, with project delays and
cost over runs. Notably, the main cause of the delayed production has been
western supplied equipment. The cost of the project, including extended working
capital has been about $45 million against an original budget of $35 million.
However, as noted in last year's report, this is still considerably cheaper than
an "all western" approach which in the current climate of capital costs would
total over $100 million. This extended commissioning time has also had an impact
on operating costs with 2005 total cash costs of $306/ounce. Current cash
operating costs are about $400/ounce and should finish the year at about $366/
ounce. The Company aims to produce gold from Suzdal for less than $300/ounce in
2007. I should like to acknowledge Kazkommertsbank for their unwavering support
of the Suzdal project. Also, the management team at Suzdal, under Ross Calnan
and Aitkaly Bakhtiyarov has overcome significant obstacles and in doing so has
positioned the Company well to take advantage of the experience gained.



SUZDAL PRODUCTION FIGURES FOR YEARS 2000 - 2005
                                                                     Budget
                 2000     2001    2002     2003     2004     2005     2006
------------    ------   ------  ------   ------   ------   ------   ------
OXIDE ORE
MINED
Tonnes        124,000   248,000 233,000  187,000  127,865    4,295        -
Grade g/t Au      6.0       6.2     5.7      3.5      2.7     0.59        -
----------     ------    ------  ------    ------  ------   ------   ------
STACKED ON HEAP
Tonnes        169,000   307,000 355,000  213,000  163,553   47,051   50,000
Grade g/t Au     6.14      5.46    4.22     3.39     2.62     1.96      0.9
----------     ------    ------  ------   ------   ------   ------   ------
SULPHIDE ORE
MINED
Tonnes              -         -       -        -  252,782   40,215  391,000
Grade g/t Au        -         -       -        -      6.2    15.64     10.4
----------     ------    ------  ------   ------   ------   ------   ------
SULPHIDE ORE 
TREATED
Tonnes              -         -       -        -        -  151,918  286,750
Grade g/t Au        -         -       -        -        -     8.09    11.26
----------     ------    ------  ------   ------   ------   ------   ------
GOLD PRODUCTION

Ounces         24,244    42,341  36,875   21,167   11,598   20,585   64,216
----------     ------    ------  ------   ------   ------   ------   ------
TOTAL CASH COST
$/oz sold         225       155     163      195      216      306      366
----------     ------    ------  ------   ------   ------   ------   ------


ZHEREK GOLD MINE

Open pit mining of oxide ores continued at Zherek, 28 km from Suzdal, with
402,276 tonnes of ore mined in 2005, some 12% over budget. Despite this
excellent mining performance (tonnage 25% higher than 2004) the grade mined was
lower than in 2004 at 2.51g/t Au compared to an average of 3.37g/t Au in the
previous year.

Heap leaching continued as scheduled and ore mined was stacked to recover 17,406
ounces of gold at an average cash cost of $370 per ounce in 2005. The oxide ore
at Zherek will be exhausted in late 2007 when open pit mining will cease. Pad
leaching and gold recovery may continue for another year after this. However,
studies and a drilling programme have begun to better define the sulphide
orebody and a review of the economics of development of an underground mine and
pre-concentrator is underway. If deemed economically feasible, it is planned to
truck concentrate to the Suzdal plant for final gold recovery.


ZHEREK PRODUCTION FIGURES FOR YEARS 2003 - 2005

                                                                       Forecast
                             2003           2004           2005          2006
-----------------   ---------------       --------       --------     ---------
OXIDE ORE MINED
Tonnes                    293,411         320,957        402,276        360,000
Grade g/t Au                 2.00             3.4           2.51           2.16
----------------    ---------------       --------       --------     ---------
STACKING ON HEAP
Tonnes                    352,891         339,685        402,276        360,000
Grade g/t Au                 1.92             3.3           2.51           2.16
----------------    ---------------       --------       --------     ---------
GOLD PRODUCTION
Ounces                     11,268          20,211         17,406         18,165
----------------    ---------------       --------       --------     ---------
Total cash cost
$/oz sold                     373             401            370            350
----------------    ---------------       --------       --------     ---------



GROUP RESOURCES INVENTORY

The Company has sought to bring all resource and reserves statements into
Australian Joint Ore Reserve Committee (JORC) Code and SRK Consulting has
recently completed a resources audit at Suzdal and Zherek. The figures provided
below are taken from SRK's report and confirm previously published Russian
standard resources. Overall attributable measured, indicated and inferred gold
resources for Suzdal and Zherek are approximately two million ounces.


JORC GROUP RESOURCES INVENTORY

                                          Ore                         Contained
                                       Tonnes            Grade             Gold
                                       ('000)         (g/t Au)        ('000 oz)
------------------------------      ---------       ----------       ----------
Suzdal oxides
Measured and indicated                   40             16.4               23
Inferred                                780              1.1               27
-------------------------           ---------       ----------       ----------
Total oxides                            820              1.9               50
-------------------------           ---------       ----------       ----------
Suzdal sulphides
Measured and indicated                  750             18.7              452
Inferred                              3,370              7.6              822
-------------------------           ---------       ----------       ----------
Total sulphides                       4,120              9.6            1,274
-------------------------           ---------       ----------       ----------
Suzdal total
Measured and indicated                  790             18.5              475
Inferred                              4,150              6.4              849
-------------------------           ---------       ----------       ----------
Suzdal Total All Categories           4,940              8.3            1,324
-------------------------           ---------       ----------       ----------

Zherek oxides
Measured and indicated                  550              2.1               37
Inferred                                510              2.8               45
-------------------------           ---------       ----------       ----------
Zherek sulphides
Measured and Indicated
Inferred                              4,370              5.4              759
-------------------------           ---------       ----------       ----------
Zherek Total
Measured and indicated                  550              2.1               37
Inferred                              4,880              5.1              804
-------------------------           ---------       ----------       ----------
Zherek Total All Categories           5,430              4.8              841
-------------------------           ---------       ----------       ----------

Total Group                          10,370              6.7            2,165
-------------------------           ---------       ----------       ----------
Total Attributable                    9,013              6.7            1,955
-------------------------           ---------       ----------       ----------
Note: table derived from SRK audited figures as at 1 January 2006.



HEALTH, SAFETY AND ENVIRONMENT

The health and safety of our employees and contractors is of primary importance
to the Company. We continually monitor safety procedures and train employees for
the special operating conditions of gold mines and treatment plants. We comply
stringently with local regulation requirements and operate our mines to
International standards.



THE FUTURE

Celtic's management has been operating in Kazakhstan since 1990 and the Company
now employs nearly 600 people at two gold mines, with offices in Semipalatinsk
and Almaty. We have enjoyed a very stable investment climate in Kazakhstan and
we have also earned the respect and support of local and national Governments.
The Company has a strong base from which to expand its business, both in
Kazakhstan and in neighbouring FSU countries.

Recently, the region has attracted a number of Western gold miners and local
companies have discovered the attractions of Western capital markets. We believe
that many mining opportunities in Kazakhstan remain. It is a country the size of
Europe, with a growing economy, a well educated and skilful workforce and stable
leadership. Expansion of Suzdal and Zherek is one priority but we are actively
reviewing acquisition opportunities. We are also looking east to the Tien Shan
gold belt, which is the richest gold province in Asia and the second largest in
the world after South Africa's Witwatersrand Basin. There are over a dozen major
gold mines or developments along this belt stretching from Northern Uzbekistan
to the Gobi desert in Mongolia. The largest of these is the 170 million ounce
Muruntau deposit in Uzbekistan but other world class deposits such as Zarmitan,
Amantaytau, Jerooy and Kumtor have also been discovered.

We recognise that not every country in this region has yet shown that their
legal and fiscal environments are as attractive to foreign mining companies as
Kazakhstan but we believe that our long experience in Central Asia will be the
key to proper risk management and give us a unique edge when assessing and
negotiating acquisitions.

My thanks go to all employees and contractors at Suzdal and Zherek and our
offices in London, Almaty and Semipalatinsk. The Company now has growing gold
production, second to none experience in the area and significant cash resources
to meet our objectives.


Kevin Foo
Managing director
16 June 2006




CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the year ended 31 December 2005
                                                               2005      2004
                                                               $000      $000
------------------------------------         -------------  --------  --------
TURNOVER FROM CONTINUING OPERATIONS                          15,662    13,584
Cost of sales                                                (9,973)   (7,145)
-------------------------                    -------------  --------  --------
GROSS PROFIT                                                  5,689     6,439
Administrative expenses                                      (4,624)   (4,266)
Foreign currency exchange (losses)/gains                     (1,274)    2,809                                     
-------------------------                    --------------  -------  --------
OPERATING (LOSS)/PROFIT FROM CONTINUING OPERATIONS             (209)    4,982
Profit on disposal of investments                                  -      962
Loan interest payable                                          (450)     (374)
Interest receivable                                             102
-------------------------                     -------------  --------  --------
(LOSS)/PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION           (263)    5,672
Taxation                                                     (1,458)   (2,295)
-------------------------                     -------------  --------  --------
(LOSS)/PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION          (1,721)    3,377
Minority interest                                              (203)     (581)
-------------------------                     -------------  --------  --------
GROUP (LOSS)/PROFIT FOR THE YEAR                             (1,924)    2,796
-------------------------                     -------------  --------  --------
All income and expenditure arises from
continuing operations.
 
                                                            US Cents  US Cents
-------------------------------------         -------------  --------  --------
(Loss)/earnings per share                                     (4.55)     7.66
Fully diluted (loss)/earnings per                             (4.55)     7.38
share                                         -------------  --------  --------
-------------------------





CONSOLIDATED BALANCE SHEET
as at 31 December 2005
                                                             2005         2004
                                                             $000         $000
-----------------------------                            ----------    ---------
FIXED ASSETS
Intangible assets                                          24,872       20,039
Tangible assets                                            44,143       28,106
Financial assets                                           11,423       47,178
-----------------------------                            ----------    ---------
                                                           80,438       95,323
-----------------------------                            ----------    ---------
CURRENT ASSETS
Stock                                                       5,846        7,071
Debtors                                                     7,552        5,465
Financial assets                                           49,623            -
Cash at bank and in hand                                   10,532       30,494
-----------------------------                            ----------    ---------
                                                           73,553       43,030
CREDITORS (amounts falling due within one year)           (19,959)     (13,664)
-----------------------------                            ----------    ---------
NET CURRENT ASSETS                                         53,594       29,366
CREDITORS (amounts due after more than one year)          (20,183)     (28,265)
PROVISION FOR LIABILITIES AND CHARGES                      (1,766)      (1,120)
-----------------------------                            ----------    ---------
NET ASSETS                                                112,083       95,304
-----------------------------                            ----------    ---------
FINANCED BY:
CAPITAL AND RESERVES
Called up share capital - equity                           12,564       11,310
Called up share capital - non-equity                            -        3,184
Capital conversion reserve                                     61           61
Share premium - equity                                    100,480       86,376
Profit and loss account - equity                           11,931        7,407
Employee Benefit Trust Reserve - equity                   (13,562)     (13,507)
-----------------------------                            ----------    ---------
SHAREHOLDERS' FUNDS                                       111,474       94,831
Minority interests - equity                                   609          473
-----------------------------                            ----------    ---------
                                                          112,083       95,304
-----------------------------                            ----------    ---------


CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 December 2005
                                                               2005       2004
                                                     Notes     $000       $000
------------------------------                     -------   --------   --------
NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES      A    4,719    (11,059)
----------------------------------                    ----   --------   --------
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received                                               396        102
Interest paid                                                (3,687)    (2,336)
------------------------------                     -------   --------   --------
NET CASH OUTFLOW FROM RETURNS ON INVESTMENTS
AND SERVICING OF FINANCE                                     (3,291)    (2,234)
----------------------------------                    ----   --------   --------
TAXATION PAID                                                (1,263)    (1,573)
------------------------------                     -------   --------   --------
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Payments to acquire intangible fixed assets                 (11,093)    (9,701)
Proceeds on disposal of tangible assets                          33          -
Payments to acquire tangible fixed assets                   (14,067)   (19,236)
Additions to financial assets                                (7,710)         -
------------------------------                     -------   --------   --------
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE
AND FINANCIAL INVESTMENT                                    (32,837)   (28,937)
------------------------------                     -------   --------   --------
NET CASH OUTFLOW BEFORE FINANCING                           (32,672)   (43,803)
------------------------------                     -------   --------   --------
FINANCING
Issue of ordinary share capital                              12,270     42,997
Costs associated with shares issued during the year             (96)         -
------------------------------                     -------   --------   --------
                                                             12,174     42,997
Net increase in loans                                           536     23,703
------------------------------                     -------   --------   --------
NET CASH INFLOW FROM FINANCING                               12,710     66,700
------------------------------                     -------   --------   --------
(DECREASE)/INCREASE IN CASH                              C  (19,962)    22,897
------------------------------                     -------   --------   --------



NOTES FOR THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2004

(A) RECONCILIATION OF OPERATING PROFIT TO NET CASH OUTFLOW FROM OPERATING
ACTIVITIES
                                                           2005           2004
                                                           $000           $000
-------------------------                               ---------     ----------
Operating (loss)/profit                                    (209)         4,982
Expenses satisfied by Employee Benefit Trusts                 -            955
Depreciation and fixed asset write down                   8,036          1,617
Decrease/(increase) in stocks                             1,225         (5,171)
Increase in debtors                                      (2,087)        (6,199)
(Decrease)/increase in creditors                         (1,843)         4,856
Settled on Employee Benefit Trust                          (626)       (10,934)
Exchange movements                                          223         (1,165)
-------------------------                               ---------     ----------
                                                          4,719        (11,059)
-------------------------                               ---------     ----------


(B) ANALYSIS OF NET FUNDS
                                         31 December       Cash      31 December
                                                           flow
                                              2004                        2005
                                              $000         $000           $000
------------------------                   ---------    ---------     ----------
Cash in hand and at bank                    30,494      (19,962)        10,532
------------------------                   ---------    ---------     ----------
Loans falling due within one year           (7,352)      (8,270)       (15,622)
Loans falling due in more than one year    (24,298)       7,734        (16,564)
------------------------                   ---------    ---------     ----------
                                           (31,650)        (536)       (32,186)
------------------------                   ---------    ---------     ----------
TOTAL                                       (1,156)     (20,498)       (21,654)
------------------------                   ---------    ---------     ----------



(C) RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS

                                                          2005            2004
                                                          $000            $000
-------------------------                             ---------      ----------
(Decrease)/increase in cash in the period              (19,962)         22,897
Cash inflow from increase in debt                         (536)        (23,703)
Cash outflow on sale of subsidiaries                          -           (116)
Inflow from SVMC debt elimination                             -         11,049
Net deficit at start of year                            (1,156)        (11,283)
-------------------------                              ---------      ----------
Net deficit at end of year                             (21,654)         (1,156)
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