Interim Results

Condor Resources PLC 27 September 2007 CONDOR RESOURCES PLC DIRECTOR'S STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007. HIGHLIGHTS • The consolidated, unaudited net loss after taxation of the Group in respect of the six months ended 30th June 2007 amounted to £691,399. • Exploration Progress: Drill tested several prospects within El Salvador; completed initial and infill trenching at most prospects; mobilised drilling rig to Nicaragua. • San Albino Project, Nicaragua: Defined a significant, regionally mineralised trend (Guyape Suture Zone) through rock chip sampling supporting a combined strike length of over 5,500 metres within the San Albino licence. • San Albino Project, Nicaragua: Announced the discovery of the Arras Prospect, within a high grade gold mineralised shear zone, including 18 metres width at 6.77g/t gold and 11.84g/t silver and 16 metres at 7.89g/t gold and 10.23g/t silver. • La Calera, El Salvador: Reported significant trench results of up to 14 metres width and at grades of up to 4.87g/t gold. • El Cacao, Nicaragua: Announced significant intercepts from the initial phase of trenching showing excellent width and grade over at least a 400 metre strike length up to 3.1m wide and at grades of up to 2.58g/t gold. • Appointment of Mirabaud Securities Limited as broker to the Company commencing on the 1st February 2007 POST PERIOD HIGHLIGHTS • El Cacao Prospect, Nicaragua: Completed a 9 drill hole, 964 metre reverse circulation and diamond drilling program. • San Albino Project, Nicaragua: Commenced an initial 1,000 metres reverse circulation and diamond drilling program on the Arras and San Albino Mine prospects. • La Calera, El Salvador: Completed a 4,000 metres infill trenching program on the main mineralised zones The full financial statements for the period follow. Enquiries: Condor Resources Plc Mark Child, Chairman +44 20 7408 1067 Nigel Ferguson, CEO +44 20 7808 7222 Nabarro Wells & Co. Limited Hugh Oram +44 20 7710 7400 Anthony Rowland +44 20 7710 7419 Mirabaud Securities Limited Rory Scott +44 20 7878 3360 Parkgreen Communications Limited Simon Robinson Erica Nelson +44 20 7851 7480 CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. Introduction In the 6 month period ending 30 June 2007, Condor has again advanced its projects through diligent exploration on most project areas, but been frustrated in El Salvador with not being able to drill its' primary project, La Calera, due to the non issue of environmental permits by the Ministry of the Environment. The Company's global JORC compliant resources remain at an Inferred Resource of some 467,000 ounces of gold and 18.4 million ounces of silver. Additional delays of up to 8 weeks due to bottlenecks in the reporting of assay results by the commercial laboratory in the USA, has also caused frustration for the company in the timely release of results to the market. The Company incurred a net operating loss of £691,399 for the 6 month period, of which £367,487 relates to the write off of exploration expenses relating to the El Potosi Project. A decision was made by the Directors to return the El Potosi Licence to Brett Resources during the period covered by these accounts, which have been expensed in conformity with IFRS requirements. Significant changes have taken place during the period with regard to the Company's projects. In El Salvador access problems have retarded progress on the drill testing of potential mineral resources at the La Calera, Carolina and Gigante Projects, whilst in Nicaragua good progress has been made with excellent results from trenching and drilling at the San Albino and Cacao Projects. This shift in focus of exploration efforts from El Salvador to Nicaragua highlights the benefit of the dual country strategy implemented by the Company. The Directors remain confident that the company's corporate goals of drill defining between 1 to 2 million ounces of gold by May 2008 can still be achieved. To assist in achieving this corporate target, manpower is being redirected from El Salvador to Nicaragua, to the areas providing significant encouragement at the San Albino and Cacao Projects. Additionally the Company is investigating alternative commercial laboratories of a similar standard and cost effectiveness to those being utilised now, to provide timely receipt of results and the calculation of mineral resources. Operationally, the Company advanced its knowledge of its projects by securing a drilling rig and commenced reverse circulation and diamond core drilling at the El Pescadito Project, El Salvador. It also reported significant trench results at La Calera, El Salvador, including mineralised structures of up to 14 metres width and at grades of 4.87g/t gold, including several, greater than 1 metre wide, higher grade zones of greater than 10g/t gold. In Nicaragua, significant intercepts were reported from the first batch of assay results for the initial phase of 34 trenches for 1,432 metres on its' El Cacao Prospect located in the historical El Limon - La India mining district, Nicaragua. These show excellent width and grade and establish a continuity of mineralization over at least a 400 metre strike length. Mineralised veins up to 3.1m width at grades of 2.58g/t gold are reported, including a one metre wide, higher grade zone of greater than 10g/t gold. Infill trenching at 40 metres spacing has been completed with assay results expected very soon. Condor's success continued with the announcement of the discovery of wide, high grade gold mineralization within a broad shear zone at its' San Albino Prospect in northern Nicaragua defining a mineralised corridor of at least 200 metres length and varying between 3 metres width in the north-east to over 18 metres width towards the south-west. Best results include 18 metres at 6.77g/t gold and 11.84g/t silver; 3 metres at 20.11g/t gold and 31.07g/t silver; 16 metres at 7.89g/t gold and 10.23g/t silver and 3 metres at 4.99g/t gold and 24.37g/t silver. Operations El Salvador A delay in the granting of environmental permits by the Ministry of Environment in El Salvador, has restricted all drilling activities to the Pescadito Concession, where a permit was awarded to Condor previously. The Company, along with all other exploration and mining companies in El Salvador, are lobbying the Government for issue of these permits to allow drilling and mining of the economic resources present. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. The El Pescadito Project exploration programs included reconnaissance geological mapping and rock chip sampling followed by 1,788 metres of trenching in 44 trenches and 1,675.43 metres of combined Reverse Circulation and Diamond drill testing of anomalous results in 25 drill holes. Significant trenching results from the El Pescadito Project included 31 metres at 1.8g/t gold and 283g/t silver; 15 metres at 1g/t gold and 105g/t silver and 5 metres at 2.78g/t gold and 326g/t silver at the Divisidero structure. Whilst significant drilling results included 2 metres at 1.44g/t gold and 63.5g/t silver in PRRD005 and 10.78 metres at 1.35g/t gold and 369g/t silver in ACRD009. Further follow up work is required. These results have highlighted the potential for the Protectora, San Francisco Tortuga and Agua Caliente-Virginia Prospects to host significant gold and silver mineralization, with the Agua Caliente -Virginia Prospect having the highest potential ranking. Follow-up trenching and drilling programs have been planned. At the El Gigante Prospect, located in the Pescadito Project, El Salvador the main target forms part of the historic El Gigante Mine, which is a north west trending multiple vein system, mined until the early 1960s by underground operations to a depth of approximately 75 metres and over a strike length of up to 500 metres. Work conducted by Condor during the period was restricted to data review of historic underground plans and channel sampling of those underground workings. Condor also complete limited reconnaissance geological mapping to date and has embarked on a significant trenching program to test the significant gold mineralization intercepted in underground channel sampling and drilling completed historically. Exploration at the La Calera Project was designed to define the extent of the mineralization hosted by the main northwest trending Rosa, Rosa West and Calichal vein systems. Initial exploration revealed the potential of extending the initial resource strike length of 600 metres to over 1,000 metres. Calera has a JORC compliant Inferred Resource of 112,604 ounces of gold, 97,373 ounces of silver. The exploration work conducted at La Calera consisted mainly of 2,270.9 metres of trenching in 16 trenches as part of a 4,000 metre trenching program. Significant results reported to date from this program include: 1 metre at 18.04g/t gold and 6.8g/t silver; 3 metres at 4.74g/t gold and 2.23g/t silver; 11 metres at 1.06g/t gold and 0.97g/t silver and 3 metres at 3.30g/t gold and 6.73g /t silver. The results of the trenching programs confirm the potential for the Rosa, Rosa West and Calichal mineralised vein systems to extend its strike length up to 1000m. Nicaragua In Nicaragua, excellent results have been returned from most project areas with significant gold intercepts returned in the San Albino Project. These include 12 metres at 5.69g/t gold in trench SATR003; 18 metres at 6.77g/t gold and 8 metres at 8.82g/t gold in trench SATR010, and 12 metres at 5.59g/t gold in trench SATR011. Further excellent results were also returned from trenching within the Las Conchitas Prospect, San Albino Project, including results of 2 metres at 3.08g/t gold and 1metre at 6.75g/t gold. Regional rock chip samples of up to 21g /t gold were also returned from the San Albino Prospect area, supporting a strike length of over 4,000 metres for the north-west striking San Albino 'Guyape Suture' trend and 1,500 metres for the nearby Las Conchitas trend. The Company is hopeful of further excellent results from the San Albino Project where ongoing work is producing high grade gold anomalies requiring trenching and drill testing. Of particular interest is the development of the Arras, San Albino Mine and Las Conchitas areas where significant, wide high grade structures are being defined with average grades in excess of 5g/t gold and individual strike lengths of greater than 200 metres. The Company's senior geologists believe that there is a distinct regional trend to this mineralization and the planned work will define further high grade zones hopefully amenable to economic mining. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. Mapping and rock chip sampling continues at the newly awarded Los Potrerillos licence adjacent to the San Albino licence, with further assay results awaited from sampling of several siliceous outcrops and float which form the main targets for exploration. To date, encouragement is gained from the initial limited program of sampling which returned indications of epithermal mineralization over broad areas within a distinct mineralised trend, interpreted by Condors geologists to be an extension of those trends defined at San Albino. Trenching at El Cacao also returned some promising intersections over a 400 metre strike length, with a best result of 1metre at 11.54g/t gold in trench CCTR004 and 3.1metres at 2.58g/t gold in trench CCTR006. Quartz mineralization was intercepted in all but one drill hole completed recently at the project and these results are awaited with confidence of further gold mineralization being present. Infill trenching on 40 metre spacing has been completed and results are awaited. Two rock chip samples from the Cacao vein returned results exceeding 1g/t gold from the main mineralised zone defined by the trenching, thus confirming mineralization further east than previously defined. A third rock chip collected over two kilometres west of the main zone also returned >0.5g/t gold. At Kuikuinita, Nicaragua, trench results from the Los Indios Prospect confirm previous results with wide low grade results including 1m at 5.08g/t and 4m at 1.31g/t gold. Further work is planned in a staged program to test this mineralised structure through trenching and then drilling. At the Columbus project, after delays caused by extended negotiations on access agreements exploration finally was underway by the end of June 2007. So far 260 metres of trenching had been completed and another 70 metres was in progress at the Mina Columbus Prospect for a total of three hundred and sixty-five samples being collected and submitted for analysis. The trenching programme at Columbus continues with assay results awaited. The Company also reviewed the Juan Sebastian Project with a view to its retention. Subsequently the project was relinquished to the licence holders. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. POST PERIOD HIGHLIGHTS El Cacao Prospect, Nicaragua The Company completed its initial reverse circulation and diamond drilling program on the El Cacao prospect to test depth extensions to the significant gold mineralization intercepted within trenching completed at surface. A total of 994 metres were completed in 9 holes. San Albino Project, Nicaragua On 3 September 2007, the Company announced the results of extension and infill trenching at the Aguja de Arras Prospect in Northern Nicaragua close to the historical high grade San Albino Gold Mine. Extensions to trenches excavated in the first phase of trenching, as well as an infill trench designed to close the trench spacing to 40 metres along strike, has extended the width and better defined the orientation of the high-grade gold mineralization reported in May 2007. A mineralised zone up to 24 metres width at a grade of 7.17 gram per tonne gold (SATR003 - including a 3 metre wide zone of internal waste) has now been defined, with individual assay results of up to 1 metre at 47.5 grams per tonne gold. This high grade gold mineralization has been intercepted in five adjacent trenches and currently defines a strike length of 200 metres, open along strike in both directions, with the maximum width of 24 metres remaining unconstrained. High grade gold mineralization at the Arras Prospect is hosted by both quartz veins and the adjacent altered wall rock, in a package of graphitic schist within the under-explored Guayape Suture Zone. The Directors believe that multiple rock chip samples assaying over 1 gram per tonne gold indicate half a dozen or more parallel mineralised systems throughout the company's San Albino Licence and extending onto the adjacent Los Potrerillos Licence. Condor's application for the 12 km2 Potrerillos Licence was granted in July this year and field rock chip sampling has already commenced. At the Arras Prospect, further extensions to the existing trenches and additional trenching along strike is already underway and a combined diamond and reverse circulation drilling program has commenced. Other gold mineralised trends identified by regional rock chip sampling within the San Albino Licence area are being systematically tested by trenching and the Company is confident that this work will result in the discovery of further high grade gold mineralised systems comparable to the Arras Prospect. El Potosi Project, El Salvador The Company recently completed a full technical review of all drilling and surface data for the El Potosi Licence in El Salvador. The review suggests that although gold is present in the system, the mineralised structures are narrow and very discrete with little or no wall-rock alteration, thus proving a very hard and expensive target to define further. It was therefore decided that Condor's other projects, such as Cacao, Arras, and San Albino, should be given every opportunity to be developed into profitable mines and the US$1.25 million payment due to Brett Resources under the Brett El Potosi Option Agreement (RNS 15 February 2007) would be better spent funding exploration and development of those projects. Condor informed Brett that it would withdraw from the El Potosi Option Agreement. Given the decision to return El Potosi Licence to Brett Resources was made by the Directors in the period covered by these accounts, the costs associated with the El Potosi Licence (£367,487) have been expensed in conformity with IFRS requirements. Nigel Ferguson Chief Executive Officer 26th September 2007. INDEPENDENT REVIEW REPORT TO CONDOR RESOURCES PLC Introduction We have been instructed by the Company to review the financial information for the six months ended 30 June 2007, which comprises Consolidated Income Statement, Consolidated Statement of Changes in Equity, Consolidated Balance Sheet, Consolidated Cash Flow Statement, and related notes 1 to 4. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. This report is made solely to the Company in accordance with guidance contained in Bulletin 1999/4 'Review of interim financial information' issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our work, for this report, or for the conclusions we have formed. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the Directors. The Directors are responsible for preparing the interim report in accordance with the AIM Listing Rules which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 'Review of interim financial information' issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of Group management and applying analytical procedures to the financial information and underlying financial data and based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with International Standards of Auditing (UK and Ireland) and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 30 June 2007. Mazars LLP London 26th September 2007 CONDOR RESOURCES PLC CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007 Six Months to Six Months to 30.06.07 30.06.06 £ £ CONTINUING OPERATIONS Operating costs (394,140) - Administrative expenses (367,427) (201,457) ------- ------- OPERATING LOSS (761,567) (201,457) Finance income 70,168 29,009 ------- ------- (691,399) (172,448) LOSS BEFORE TAX Tax - - ------- ------- LOSS FOR THE PERIOD (691,399) (172,448) ======= ======= Attributable to: Equity holders of the parent (691,399) (172,448) ======= ======= Earnings per share expressed in pence per share: Basic (0.53) (0.35) Diluted (0.49) (0.28) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 30.06.07 31.12.06 30.06.06 £ £ £ Losses (691,399) (518,076) (172,448) Exchange difference (3,353) - - Share capital 5,000 - 1,298,118 Share premium 46,022 - 7,306,486 Legal reserve - 60 - Share option reserve - 109,275 - ------- ------- ------- Net addition to reserves (643,730) (408,741) 8,432,156 Opening reserves 8,023,415 8,432,156 - ------- ------- ------- Closing reserves 7,379,685 8,023,415 8,432,156 ======= ======= ======= CONDOR RESOURCES PLC CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2007 30.06.07 31.12.06 30.06.06 £ £ £ ASSETS NON-CURRENT ASSETS Property, plant and equipment 111,975 69,473 27,441 Intangible assets 4,984,270 4,464,040 3,940,300 Trade and other receivables 6,281 170,076 9,660 ------- ------- ------- 5,102,526 4,703,589 3,977,401 ------- ------- ------- CURRENT ASSETS Trade and other receivables 74,096 40,818 596,226 Cash and cash equivalents 2,319,142 3,456,183 4,326,693 ------- ------- ------- 2,393,238 3,497,001 4,922,919 ------- ------- ------- LIABILITIES CURRENT LIABILITIES Trade and other payables 116,079 176,934 468,164 Tax payable - 241 - ------- ------- ------- 116,079 177,175 468,164 ------- ------- ------- NET CURRENT ASSETS 2,277,159 3,319,826 4,454,755 ------- ------- ------- NET ASSETS 7,379,685 8,023,415 8,432,156 ======= ======= ======= SHAREHOLDERS' EQUITY Called up share capital 1,303,118 1,298,118 1,298,118 Share premium 7,352,508 7,306,486 7,306,486 Legal reserves 60 60 - Share options reserve 109,275 109,275 - Exchange difference (3,353) - - Retained earnings (1,381,923) (690,524) (172,448) ------- ------- ------- Total shareholders' equity 7,379,685 8,023,415 8,432,156 ------- ------- ------- TOTAL EQUITY 7,379,685 8,023,415 8,432,156 ======= ======= ======= CONDOR RESOURCES PLC CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007 Six Six Months to Months to 30.06.07 30.06.06 £ £ Cash flows from operating activities Loss before tax (691,399) (172,448) Exchange rate difference (3,353) - Depreciation charges 14,918 3,262 Finance income (70,168) (29,009) ------- ------- (750,002) (198,195) (Decrease)/Increase in trade and other receivables 130,517 (26,516) (Decrease)/Increase in trade and other payables (61,096) 468,164 ------- ------- Net cash from operating activities (680,581) 243,453 Cash flows from investing activities Acquisition of subsidiaries - (55,570) Purchase of intangible fixed assets (520,230) (346,407) Purchase of tangible fixed assets (57,420) (30,703) Interest received 70,168 29,009 ------- ------- Net cash from investing activities (507,482) (403,671) ------- ------- Cash flows from financing activities Proceeds from share issue 51,022 5,263,482 Less issue costs - (776,571) ------- ------- Net cash from financing activities 51,022 4,486,911 (Decrease)/Increase in cash and cash equivalents (1,137,041) 4,326,693 Cash and cash equivalents at beginning of period 3,456,183 - ------- ------- Cash and cash equivalents at end of period 2,319,142 4,326,693 ======= ======= CONDOR RESOURCES PLC NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS TO 30 JUNE 2007 1. ACCOUNTING POLICIES Basis of preparation These financial statements have been prepared in accordance with International Financial Reporting Standards and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS. During the year ended 31 December 2006 the directors completed the initial accounting of the acquisition of the company's subsidiary undertakings. As a result, the amount of goodwill, as reported in the six month period to 31 August 2006, was de-recognised and mineral resources were recognised at their fair value. The fair value given to the mineral resources was £3,600,443 The Interim report is unaudited and does not constitute statutory financial accounts as defined in section 240 of the Companies Act 1985 The Interim Report for the six months ended 30 June 2007 was approved by the Directors on 26 September 2007. The comparative period presented is that of 30 June 2006. The directors are of the opinion that due to the nature of the group's activities and the events during that period these are the most appropriate comparatives for the current period. Copies of the Interim Report are available from the Company's website www.condorresourcesplc.com. 2. REVENUE AND SEGMENTAL REPORTING The Group has not generated any revenue during the period. The Group's operations are located in England, El Salvador and Nicaragua. The following is an analysis of the carrying amount of segment assets, and additions to plant and equipment, analysed by geographical area in which the assets are located. Carrying amount Additions to Depreciation Carrying amount Result of segment property, plant charged in the of liabilities for the assets & equipment and period period intangible assets Periods ended 30th June 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 £ £ £ £ £ £ £ £ £ £ England 6,225,533 8,543,112 165,380 3,643,040 1,442 - 105,340 466,201 (223,613) (124,385) El Salvador 834,136 354,546 104,102 327,963 10,800 3,262 5,017 1,963 (380,254) (47,002) Nicaragua 436,095 2,662 308,168 - 2,676 - 5,722 - (87,532) (1,061) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Total 7,495,764 8,900,320 577,650 3,971,003 14,918 3,262 116,079 468,164 (691,399) (172,448) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ 3. TAX There is no current tax charge for the period. The accounts do not include a deferred tax asset in respect of carry forward unused tax losses as the Directors are unable to assess that there will be probable future taxable profits available against which the unused tax losses can be utilised. 4. EARNINGS PER SHARE Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. CONDOR RESOURCES PLC NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS TO 30 JUNE 2007 A reconciliation is set out below: Six months to Six months to 30.06.07 30.06.06 Basic EPS Loss for the period (691,399) (172,448) Weighted average number of shares 130,145,086 49,637,127 Loss per share (in pence) (0.53) (0.35) ------- ------- Diluted EPS Loss for the period (691,399) (172,448) Weighted average number of shares 141,895,086 61,387,127 Loss per share (in pence) (0.49) (0.28) ------- ------- This information is provided by RNS The company news service from the London Stock Exchange

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