Final Results

21 November 2014

                        Karelian Diamond Resources Plc                         

                           ("KDR" or the "Company")                            

                 Final results for the year ended 31 May 2014                  

                       Highly Encouraging Progress Made                        

Karelian (AIM: KDR, ESM: KDRI), the diamond exploration company focused on
Finland, announces its results for the year ended 31 May 2014, a year in which
highly encouraging progress has been made towards achieving the aim of
discovering a world class diamond deposit in Finland.

Highlights:

  * Riihivaara - Excellent results achieved both during the year and since
   
  * recovery of high concentrations of kimberlitic indicator minerals suggests
    the presence nearby of a kimberlite source
   
  * results include 48 purple to red peridotitic garnets (G9/10 Cr-pyrope) and
    46 orange mantle garnets between 0.25 and 0.5mm in size
   
  * indicator minerals have recently been sent for analysis by scanning
    electron microscopy for precise classification
   
  * Results indicate presence of new kimberlite source close to Seitaperä - the
    largest diamondiferous kimberlite pipe yet discovered in Finland
   
Post Period:

  * Three further exploration Claim Reservations located in the Kuhmo and
    Kuopio-Kaavi regions granted - five kimberlite bodies known to be present
   
  * Agreement with Rio Tinto extended to 2020
   
Finance:

  * The loss after taxation for the year ended 31 May 2014 was €198,891 (2013:
    €179,955)
   
  * A series of Placings raised a total of £2,725,000
   
  * Net Assets as at 31 May 2014 were €8,406,643 (2013: €4,422,130)
   
Professor Richard Conroy, Chairman, stated:

"The Company has made significant progress in its diamond exploration programme
in Finland and this has continued into the current financial year. The results
from Riihivaara are particularly pleasing. We have had excellent sample results
and are hopefully getting very close to a kimberlite source."

Further Information:

Professor Richard Conroy, Chairman, Karelian       Tel: [phone]        
Diamond Resources plc                                                          
                                                                               
Virginia Bull / Simon Clements, Sanlam Securities  Tel: [phone]       
UK Limited (Nomad)                                                             
                                                                               
Ger Heffernan, IBI Corporate Finance Limited (ESM  Tel: [phone]        
Adviser)                                                                       
                                                                               
Jon Belliss / Abigail Wayne, Hume Capital          Tel: [phone]       
Securities Plc (Broker)                                                        
                                                                               
Michael Padley / Gary Middleton, Lothbury          Tel: [phone]       
Financial Services Limited                                                     
                                                                               
Don Hall, Hall Communications                      Tel: [phone]        

http://www.kareliandiamondresources.com

Chairman's Statement

I have pleasure in presenting your Company's Annual Report and Financial
Statements for the year ended 31 May 2014. During the year, further highly
encouraging progress has been made towards achieving your Company's objective
of discovering a world class diamond deposit in Finland, comparable to those
which have been found in similar geology nearby in Russia. Excellent results
have been achieved at your Company's exploration target at Riihivaara, both
during the year to 31 May and since. Positive results at other targets have led
to several new claim applications.

Financially a series of successful Placings raised in total £2,725,000. Also,
your Company's Confidentiality Agreement (with Back in Rights) with Rio Tinto
has been extended to 2020, post period.

The recovery of high concentrations, for the Karelian Craton, of kimberlitic
indicator minerals ("KIMs") in Riihivaara indicates the nearby presence of a
new kimberlite source in the Kuhmo region of Finland.

Laboratory results from a sample collected on the Company's Riihivaara target
in the Kuhmo region show high concentrations of over 100 kimberlitic indicator
minerals. The results included 48 purple to red peridotitic garnets (G9/10
Cr-pyrope) and 46 orange mantle garnets which are between 0.25 and 0.5mm in
size, plus 5 purple to red peridotitic garnets (G9/10 Cr-pyrope) and 3 orange
mantle garnets in the 0.5 to 1.0mm size range. G9/10 garnets are considered
significant as they are formed at the same temperatures and pressures as
diamonds.

Orange mantle garnets can include eclogitic pyrope-almandine garnets (G3) and
if eclogite mantle materials are present it is significant, as it tends to be
associated with richer diamond grades. The garnets will be tested to establish
whether eclogite mantle materials are present. In the Kuhmo region of Finland,
high numbers of kimberlitic indicator minerals are typically only seen either
directly over or within a hundred metres of a kimberlite source.

The indicator minerals have recently been sent for analysis by scanning
electron microscopy for precise classification which will determine whether any
of the sample material is derived from the diamond stability field.

Your Company has for some time been following up the diamondiferous kimberlitic
indicator mineral trains that we have discovered on our Riihivaara target. The
board is hopeful that we are getting very close to or immediately over the
source.

The Riihivaara claim reservation lies approximately 10km southeast of the
Company's Seitaperä kimberlite target in the Kuhmo municipality in Eastern
Finland where your Company has outlined the largest diamondiferous pipe yet
discovered in Finland.

Claims Reservations Granted

After year-end TUKES (The Finnish Mining Authority) granted Karelian three
further exploration Claim Reservations located in the Kuhmo and Kuopio-Kaavi
regions.

The Claim Reservation in the Kuhmo region is up ice from kimberlitic indicator
minerals recovered previously by your Company at its Rihiivaara diamond
exploration target.

The possibility of new discoveries in the Kuusamo area complements the positive
results at your Company's Riihivaara target area. Other targets in the Kuhmo
area include the Havukkasuo and Lentiira kimberlite pipes.

Kuopio-Kaavi is situated in Central Finland and is an established
diamondiferous region. In both of the Claim Reservations granted in the
Kuopio-Kaavi region, diamondiferous kimberlite bodies have been reported. These
Claim Reservations were applied for with a view to re-evaluating known
kimberlite bodies and following up on indicator mineral trains.

Five kimberlite bodies are known to be present in the Claim Reservation areas.
Malmikaivos oy reported that four of these bodies contain diamonds, including
Kimberlite body 21, a sample containing 128 diamonds of greater than 0.8 mm and
also a large single stone of 1.126 ct.

We are delighted that we have secured these diamond bearing kimberlite bodies
as part of our ongoing diamond exploration programme in Finland and our
re-evaluation of the Kuopio-Kaavi area.

Agreement with Rio Tinto

The Company's agreement with Rio Tinto has been extended to 2020. Under the
agreement, Rio Tinto discloses to Karelian confidential information and
physical geological samples relating to exploration in Finland for the purpose
of Karelian considering that information in relation to Karelian's potential
and existing exploration programmes in Finland.

As consideration for Rio Tinto disclosing the confidential information to it,
Karelian has agreed that Rio Tinto will have the option to earn a 51 per cent.
interest in any project identified by Karelian in Finland by Rio Tinto paying
the direct cash expenditures incurred in developing the project subject to the
following conditions:

1. For diamond projects the option will be triggered if Karelian completes 10
tons or more of bulk sampling for diamond exploration; and

2. For all other minerals the option will be triggered if Karelian discovers a
resource with an in situ value that is equal to or greater than the in situ
value of 3 million ounces of gold in a JORC compliant resource calculation.

Finance

The loss after taxation for the year ended 31 May 2014 was €198,891 (2013: €
179,955) and the net assets as at 31 May 2014 were €8,406,643 (2013: €
4,422,130).

As in previous years, I have supported the working capital requirements of the
Company. The balance of the loans and interest due to me at the period end was
€309,589. The loans have been made on standard commercial terms.

The other Directors consider, having consulted with the Company's Nominated
Adviser and the Company's ESM Adviser, that the terms of these loans are fair
and reasonable in so far as the Company's shareholders are concerned.

Auditors

I would like to take the opportunity to thank the partners and staff of
Deloitte and Touche for their services to your Company during the course of the
year.

Directors, Consultants and Staff

I would also like to express my deep appreciation of the support and dedication
of the directors, consultants and staff, which has made possible the continued
progress which your Company has achieved.

Future Outlook

Your Company has made significant progress in its diamond exploration programme
in Finland and we look forward to building on these achievements. We have had
excellent sample results and are hopefully getting very close to a kimberlite
source.

Professor Richard Conroy
Chairman

21 November 2014

INCOME STATEMENT

FOR THE YEAR ENDED 31 MAY 2014

                                                             2014          2013
                                                                               
                                                                €             €
                                                                               
Operating expenses                                      (191,139)     (165,604)
                                                                               
Finance income - bank interest receivable                     699             -
                                                                               
Finance costs - Interest on shareholder loan              (8,451)      (14,351)
                                                                               
Loss Before Taxation                                    (198,891)     (179,955)
                                                                               
Taxation                                                        -             -
                                                                               
Loss RETAINED for the year                              (198,891)     (179,955)
                                                                               
Loss per ordinary share                                 (€0.0013)     (€0.0019)

STATEMENT OF FINANCIAL POSITION

AS AT 31 MAY 2014

                                                             2014          2013
                                                                               
                                                                €             €
                                                                               
Assets                                                                         
                                                                               
Non-current Assets                                                             
                                                                               
Intangible assets                                       7,329,228     6,801,539
                                                                               
Investment in subsidiaries                                      4             4
                                                                               
Property, plant and equipment                                 165           333
                                                                               
                                                        7,329,397     6,801,876
                                                                               
Current Assets                                                                 
                                                                               
Trade and other receivables                                55,779        11,691
                                                                               
Cash and cash equivalents                               2,105,041         2,506
                                                                               
                                                        2,160,820        14,197
                                                                               
Total assets                                            9,490,217     6,816,073
                                                                               
Equity and Liabilities                                                         
                                                                               
Capital and reserves                                                           
                                                                               
Called up share capital                                 2,865,350       922,083
                                                                               
Share premium                                           6,786,177     4,621,158
                                                                               
Share based payments reserve                              525,275       450,157
                                                                               
Retained earnings                                     (1,770,159)   (1,571,268)
                                                                               
Total equity                                            8,406,643     4,422,130
                                                                               
Non-current liabilities                                                        
                                                                               
Financial liabilities                                     309,589     1,171,968
                                                                               
Total non-current liabilities                             309,589     1,171,968
                                                                               
Current liabilities                                                            
                                                                               
Trade and other payables                                  773,985     1,221,975
                                                                               
Total Current Liabilities                                 773,985     1,221,975
                                                                               
Total Liabilities                                       1,083,574     2,393,943
                                                                               
Total Equity and Liabilities                            9,490,217     6,816,073

Cash Flow Statement

For the Year Ended 31 May 2014

                                                             2014          2013
                                                                               
                                                                €             €
                                                                               
Cash used in operations                                 (147,489)      (50,768)
                                                                               
Tax paid                                                        -             -
                                                                               
Net cash used in operating activities                   (147,489)      (50,768)
                                                                               
Cash flows from investing activities                                           
                                                                               
Investment in exploration and evaluation assets         (432,548)     (292,105)
                                                                               
Net cash used in investing activities                   (432,548)     (292,105)
                                                                               
Cash flows from financing activities                                           
                                                                               
Issue of share capital (net of share issue expenses)    3,025,788             -
                                                                               
Increase in accrued director's remuneration                     -       242,325
                                                                               
(Repayment)/Advances of Shareholder loans               (343,915)        93,000
                                                                               
Interest received                                             699             -
                                                                               
Net cash generated from financing activities            2,682,572       335,325
                                                                               
Increase/(decrease) in cash and cash equivalents        2,102,535       (7,548)
                                                                               
Cash and cash equivalents at beginning of year              2,506        10,054
                                                                               
Cash and cash equivalents at end of year                2,105,041         2,506

Notes to the Financial Statements

1. Publication of non-statutory accounts

The financial information set out in this preliminary announcement is
abbreviated from the accounts as defined in Section 19 of the Companies
(Amendment) Act 1986.

The financial information for the year ended 31 May 2014 have been extracted
from the Company's financial statements to that date which have received an
unqualified auditors' report but have not yet been delivered to the Registrar
of Companies.

2. Earnings per share

The calculation of the loss per share of €0.0013 (2013 - €0.0019) is based on
the loss for the financial year of €198,891 (2013 - €179,955) and the weighted
average number of ordinary shares in issue on a basic and fully diluted basis
during the year of 157,942,015 (2013 - 92,308,242).

The effect of share options and warrants is anti-dilutive.

3. Dividends

No dividends were paid or are proposed in respect of the year ended 31 May
2014.

4. Copies of Accounts

A copy of the Annual Report and Financial Statements will be available on the
Company's website www.kareliandiamondresources.com and will be available from
the Company's registered office, 10 Upper Pembroke Street, Dublin 2. It will
also be forwarded to shareholders who requested a hard copy. Notice of the
Annual General Meeting to be held on 15 December 2014 and Proxy Form will be
sent to Shareholders in due course.