Annual Financial Report

BISICHI MINING PLC

Results for the year ended 31 December 2008

RECORD PERFORMANCE AT SOUTH AFRICAN COAL MINING OPERATIONS

* Record profit before tax in excess of ?6 million (realised) (2007: ?2.3
million) reflects impact of open cast mining at Black Wattle Colliery

* ?5.1 million of profit before tax (realised) made in second half of 2008

* Monthly production at Black Wattle rises to 130,000 metric tonnes per month

* Mine CAPEX, due for completion in Q2 2009, will increase plant capacity to
170,000 metric tonnes per month

* Investment property portfolio revalued in line with the market but
recession has not had any effect on rental income or lettings

* Dividend increased by 16.7% to 3.5p per share

Commenting on the results, Michael Heller, chairman of Bisichi Mining PLC said:

‘2008 has been another record year for Bisichi. Despite the challenges of the
global recession we are well positioned for the coming year.’

END

For further information, please call:

Andrew Heller,

Robert Corry,

Tom Kearney, Bisichi Mining PLC 020 7415 5030

Christopher Joll BLJ Financial 07721 330730

CHAIRMAN’S STATEMENT

I am very pleased to inform shareholders that Bisichi made a record profit
before tax in 2008 in excess of ?6.0 million (Realised) (2007: ?2.3 million).
As ?5.1 million of this profit was made in the second half of 2008, at a time
when international commodity prices were tumbling, the year’s success can be
attributed to the advent of open cast mining at Black Wattle combined with
strong performance from the existing underground sections. In contrast to many
mining companies around the world, the financial position of Bisichi has never
been stronger.

The commencement of open cast mining at Black Wattle Colliery in April 2008
fundamentally changed the profitability profile of the mine. In addition to
improving yields and product quality, open cast mining also allows us to mine
much more flexibly, adding or reducing production promptly when necessary. As a
result of the open cast mining, we have been able to increase monthly
production to a regular 130,000 metric tonnes per month. We are presently
finalising applications to the Department of Mineral and Energy (DME) for the
opening up additional areas to mine open cast.

In 2008, we commenced a capital investment programme at Black Wattle which,
when completed in the second quarter of 2009, will expand the plant’s capacity
from 130,000 to 170,000 metric tonnes per month. The investment programme is
already producing results having already improved yields and increased
productivity at the plant.

In April 2008 – with the full and final settlement of our dispute with our
previous Black Economic Empowerment (BEE) partner – we embarked on a search to
identify a new BEE partner for a 37.5% equity stake in Black Wattle. I am
pleased to report that, in November 2008, we signed an agreement for the sale
of this stake to a well recognised, publicly listed BEE company with a strong
track record in financial services, property and mining. Further details of
this transaction will be released in due course once the transaction has
received the approval of the Department of Minerals and Energy.

Bisichi’s UK retail property portfolio, managed by London & Associated
Properties PLC, continues to contribute substantial cash to the company and is
virtually fully let. Although there has been a significant downturn in the UK
property market and, more specifically, in the valuation of Bisichi’s property
portfolio, we are intensively managing the properties to ensure that rental
income remains strong. To date, we have not seen any effect on rental income or
on the lettings within the portfolio: in 2008, rental income totalled ?1.032
million (2007: ?1.019 million).

To underline our confidence in the future of Bisichi, your directors are
recommending a dividend of 3.5p, compared to a 3.0p per share in the previous
year, an increase of 16.7%. This will be paid on Monday 10 August to
shareholders on the register at the close of business on 4 July 2009.

2008 has been a record year for Bisichi. Although we anticipate 2009 will be a
difficult year in the international coal market, with the open cast operations
running smoothly at Black Wattle and your management taking a proactive
approach to managing in the downturn, we are well positioned for the coming
year.

Michael Heller, Chairman

MINING REVIEW

As noted in the Chairman’s statement, 2008 was a record year for Bisichi in
South Africa. Our direct mining asset, Black Wattle, enjoyed its most
profitable year ever. It is important to stress that most of this profit was
made in the second half of 2008. This was as a result of open cast mining
coming on line in April 2008, when we were able to improve production and
quality at Black Wattle Colliery even as international commodity markets
started to collapse. We will continue to see the value of the opencast
operation contributing strongly to Black Wattle’s profitability in 2009.

Production

The effect of open cast on yield, quality, and profitability has been immediate
and continuous. Total run of mine production in 2008 was 1.31 million metric
tonnes, but the trend for the second half (when the open cast was in full
commercial production) was closer to an annual production rate of 1.5 million
metric tonnes. Given the reliability and flexibility of the open cast
operations, we have been able to increase production to a regular 130,000
metric tonnes per month.

During 2008, the number of underground shifts was reduced from three to two. We
expect, after nearly five years in operation, the continuous miner section will
come to the end of its operational life in 2009. Any reduction in tonnage from
the closure of the continuous miner section will be made up from the open cast
section and the potential buy in of coal.

An intensive capital investment programme was carried out at the washing plant
in 2008. In addition to increasing productivity and efficiency at the plant,
the investment programme will also expand the capacity of the washing plant to
170,000 metric tonnes per month. This expansion is scheduled for completion in
the second quarter of 2009. The enhanced plant will give us the opportunity to
increase production from our own operations or to purchase coal from nearby
operations which do not have their own coal washing facilities.

Markets

2008 witnessed one of the most volatile periods in the international coal
market in decades. At the beginning of 2008, the average weekly price of Free
on Board (FOB) Coal from Richards Bay Coal Terminal (API4) stood at nearly
US$100.00 per metric tonne. By June 2008, this had increased to US$140.00 per
metric tonne, peaking at over US$180.00 per metric tonne by August. By the end
of the year, the API4 price had fallen to US$75.00 per metric tonne. API4
currently trades at about US$ 61.00 per metric tonne.

In late 2007, we fixed our export coal price until the end of 2009 for the
majority of our export coal with one of the the world’s largest commodities
traders. While the bulk of our export volumes are covered by this fixed price
contract, there will be some incremental volumes sold on a spot basis which
will reflect the new international prices.

Domestic prices benefited from the sharp rise in international coal prices and
we achieved significant price increases in 2008. These prices are now beginning
to reflect the downturn and we anticipate having to reduce our prices for our
domestic steam coal product. As a result of the collapse in global steel
prices, the ferrochrome industry has effectively ceased production in South
Africa. As a consequence, we do not anticipate supplying large volumes of low
phosphorous coal to the ferrochrome industry in 2009.

Health, Safety & Environment (HSE)

Black Wattle is committed to creating a safe and healthy working environment
for its employees, and the health and safety of our employees is of the utmost
importance. In addition to the requisite personnel appointments and assignment
of direct health and safety responsibilities on the mine, a system of Hazard
Identification and Risk Assessments has been designed, implemented, and
maintained at Black Wattle.

Health and Safety training is conducted on an ongoing basis. Supervisors and
about 60 percent of employees up to date have received training in hazard
identification and risk assessment in their work areas. A medical surveillance
system is in place which provides management with information used in
determining measures to eliminate, control and minimalise employee health risks
and hazards and all Occupational Health hazards are monitored on an ongoing
basis.

A Health Safety and Environment Manager was recently appointed. The key
performance targets of the HSE Manager are:

* To eliminate, control and minimise the risk to all employees at Black
Wattle Colliery.

* Effective management and control of contractor activities at Black Wattle
Colliery from a HSE perspective.

* Develop, implement and monitor the Risk and Change Management process.

* Ensure compliance of HSE systems to legal and other requirements.

* Develop, implement and maintain together with management team a HSE
strategy to ensure continual improvement of the company’s HSE performance.

* Develop, implement and maintain an investigation system to determine the
immediate and underlying causes of incidents.

Various systems to enhance the current HSE strategy have been introduced as
follows:

* In order to improve hazard identification before the commencing of tasks,
mini risk assessment booklets were rolled out to all mine employees and
long term contractors on the mine.

* In order to improve the current reporting practice of incidents on the
mine, Initial reporting of incidents booklets were handed out to all
employees and contractors.

* In order to capture and record investigation findings from incidents, an
incident recording sheet was introduced to line management and contractors
.

* Hazard Identification and Risk Assessment training was presented to line
management, Head of Department’s and contractor representatives.

* A HSE `contractor pack’ was introduced to all contractors working on Black
Wattle.

* A weekly labour return form was introduced to all contractors.

* A Plan, Do, Review system for all Heads of Department was introduced to
encourage managers to take ownership of HSE matters.

* In order to effectively control jobs over weekends that require additional
risk assessments to safely perform tasks, a weekend work register was
introduced on the mine.

Environment Management Programme

Under the terms of the mine’s Environmental Management Programme approved by
the DME, Black Wattle undertakes a host of environmental protection activities
to ensure that the approved Environmental Management Plan is fully implemented.
In addition to these regular activities, Black Wattle regularly carries out
environmental monitoring activities on and around the mine, including
evaluation of ground water quality, air quality, noise and lighting levels,
ground vibrations, air blast monitoring, and assessment of visual impacts.

Community Support and Social Development

Black Wattle is an active participant in the Steve Tshwete Municipal Area, the
locality where many of the mine’s employees reside. Black Wattle regularly
provides municipal services to our surrounding community, including waste
removal, road repair, transport, provision of winter fuel supplements, and
emergency water supply assistance.

Black Wattle has continuously provided ongoing support to the local Evergreen
Primary School, including the construction and maintenance of a perimeter
fence, the electrification of main school buildings, the construction of
offices and repair of school facilities, and support for the employment costs
of additional school staff.

Procurement

In compliance with the Mining Charter and the Mineral and Petroleum Resource
Development Act, Black Wattle has implemented a BEE-focussed procurement policy
which strongly encourages our suppliers to establish and maintain BEE
credentials. At present, BEE companies provide approximately 66 percent of
Black Wattle’s equipment and services. We closely monitor our monthly
expenditure and welcome potential BEE suppliers to compete for equipment and
service contracts at Black Wattle. Black Wattle also sells much of its coal
products to empowered companies as evidenced by our long term sales agreement
with a BEE company for the purchase of our discard product which is then sold
to the national power utility Eskom.

Employment Equity

Black Wattle is committed to achieving the goals of the Employment Equity Act.
Presently, over 13 percent of Black Wattle’s workforce is female, which
includes women working as artisans and mining equipment operators. Black
Wattle’s Workplace Skills Plan and Annual Training report has been approved by
the Mining Qualifications Authority.

Skills Training

Black Wattle has constructed a computer- equipped training centre which
supports the mine’s Adult Basic Education and Training (ABET) programme,
provides HIV/AIDS education and carries out other continuing education
programmes for the mining workforce. A Training Manager has been appointed to
lead training activities on the mine.

People

In April 2008, Luis Pinel was appointed General Manager of Black Wattle. Luis
has made a substantial contribution to Black Wattle’s performance during the
year. Luis has made a number of key senior appointments on the mine, including
that of Nic Bessenger as HSE Manager. Nic Bessenger’s key role on the mine is
to manage all HSE functions as well as safety related training activities.

Prospects

I cannot emphasise enough the value of having a profitable and fully
operational mine in the current environment. Many developing mines have been
delayed or stopped altogether because of lack of finance and the collapse in
international commodity markets. While the prices for coal have fallen we
prudently fixed the price for much of our export coal in 2007 until towards the
end of 2009. Furthermore, open cast mining has fundamentally changed the cost
structure and the level of productivity at Black Wattle. Going forward, we are
presently submitting additional applications for open cast permission which
will extend the life and improve productivity at the mine even further. I am
confident that 2009 should be successful for our South African operations.

Andrew Heller, Managing Director

BUSINESS REVIEW

Review of the group’s development and performance

The Chairman’s Statement and the Mining Review on the preceding pages 2 to 11
give a comprehensive review and assessment of the group’s activities during the
past year and prospects for the forthcoming year.

Risk

Coal price risk: The group’s mining operations earnings are largely dependent
on movements in the coal price. It does have the flexibility in terms of
markets where it can sell its coal domestically (to local industrial consumers
and the power industry) or to export to international markets.

Coal washing: The group’s mining operation’s earnings are highly sensitive to
coal washing, therefore a stoppage or disruption to the process could
significantly impact earnings. However, there is scope to raise earnings
substantially if the yield from the washing process is improved even
marginally.

Mining risk: Part of the group’s South African operation is an underground
mine, attached to which there are inherent health and safety risks. Any such
safety incidents disrupt operations, and can slow or even stop production. The
group has a comprehensive Health and Safety programme in place to mitigate
this. There is scope to increase production in the opencast section to
compensate for disruption in production from the underground mine.

As with many mining operations, the reserve that is mined has the risk of not
having the qualities expected from geological analysis.

Currency risk: The group’s South African operations are sensitive to currency
movements, especially those between the South African Rand, US Dollar and
Sterling .

New reserves and mining permissions: The acquisition of additional reserves,
permissions to mine opencast on existing reserves and new mining opportunities
in South Africa generally are contingent on a number of factors outside of the
group’s control, e.g. approval by the Department of Minerals and Energy.

Regulatory risk: The group’s South African operations are subject to the
government Mining Charter and scorecard which primarily seeks to:

* Promote equitable access to South Africa’s mineral resources for all people
in South Africa;

* Expand opportunities for historically disadvantaged South Africans
(HDSA’s), including women, to enter the mining and minerals industry and
benefit from the extraction and processing of the country’s resources;

* Utilise the existing skills base for the empowerment of HDSA’s;

* Expand the skills base of HDSA’s in order to serve the community;

* Promote employment and the social and economic welfare of mining
communities and areas supplying mining labour; and

* Promote beneficiation of South Africa’s mineral commodities beyond mining
and processing, including the production of consumer goods.

The group continues to make good progress towards meeting the Charter
requirements. However any regulatory changes to these, or failure to meet
existing targets, could adversely affect the mine’s ability to retain its
mining rights in South Africa.

Transport risk: At present the government owned Transnet Freight Rail (TFR) is
the sole rail freight provider for coal in South Africa. The group’s South
African operations are therefore reliant on TFR for delivery of its export
quality coal directly or indirectly via the Southern African ports to its end
customers.

Power supply risk: The current utility provider for power supply in South
Africa is the government run Eskom. Eskom has recently undergone capacity
problems resulting in power cuts and lack of provision of power supply to new
projects. The group’s mining operations have to date not been affected by power
cuts.

Flooding risk: The group’s mining operations are susceptible to seasonal
flooding which could disrupt production. Management monitors water levels on an
ongoing basis and various projects have been completed or are due for
completion in the coming months, including the construction of additional dams,
to mitigate this risk.

Environmental risk: The group’s South African mining operations are required to
adhere to local environmental regulations. Details of the groups Environment
Management Programme is disclosed in the mining review on page 6.

Health & Safety risk: The group’s South African mining operations are required
to adhere to local Health and Safety regulations. Details of the groups Health
and Safety Programme is disclosed in the mining review on page 6.

Labour risk: The group’s underground mining operations and coal washing plant
facility are labour intensive and unionised. Any labour disputes, strikes or
wage negotiations may disrupt production and impact earnings.

We seek to balance the high risk of our mining operations with a dependable
cash flow from our UK property investment operations. Fluctuations in property
values, which are reflected in the Income Statement and Balance Sheet, are
dependent on an annual valuation of commercial properties. During recent years
healthy surpluses have been shown in the group’s annual year end property
valuations, but a fall in UK commercial property has had a marked effect in
profitability and the net asset value of the group. However, due to the long
term nature of the leases, the effect on cash flows from property investment
activities will remain stable as long as tenants remain in operation.

Future development

The group seeks to expand its operations in South Africa through the
acquisition of additional coal reserves.

Environment and employment

The group’s UK activities are principally property investment whereby we
provide premises which are rented to retail businesses. We seek to provide
those tenants with good quality premises from which they can operate in an
efficient and environmentally sound manner.

Our South African mining operations are regulated by and are operated in
compliance with all relevant prevailing national and local legislation.
Employment terms and conditions provided to mining staff meet or exceed the
national average.

Performance indicators

The Key Performance Indicator for our South African mining activities is Profit
before Tax (PBT) and Earnings before Interest, Tax, Depreciation, and
Amortisation (EBITDA).

The Key Performance Indicator for our UK property investment operations is the
Net Property Valuation as shown on page 42 note 11.

DIRECTORS’ REPORT

The directors submit their report together with the audited financial
statements
for the year ended 31 December 2008.

Activities and review of business

The company continues its mining activities. Income for the year was derived
from sales of coal from its South African operations. The company also has a
property investment portfolio for which it receives rental income.

The results for the year and state of affairs of the group and the company at
31 December 2008 are shown on pages 29 to 50 and in the Mining Review and
Business Review on pages 6 to 15. Future developments and prospects are also
covered in the Mining Review. Over 99 per cent of staff are employed in the
South African coal mining industry – employment matters and health and safety
are dealt with in the Mining and Business reviews.

Corporate responsibility

Environment:The environmental issues of the group’s South African coal mining
operations are covered in the Mining Report and Business Review on pages 6 to
15.

The group’s UK activities are principally property investment whereby premises
are provided for rent to retail businesses. The group seeks to provide those
tenants with good quality premises from which they can operate in an efficient
and environmentally friendly manner. Wherever possible, improvements, repairs
and replacements are made in an environmentally efficient manner and waste
re-cycling arrangements are in place at all the company’s locations.

Employment: The group’s policy is to attract staff and motivate employees by
offering competitive terms of employment. The group provides equal
opportunities to all employees and prospective employees including those who
are disabled. The Mining Review gives details of the group’s activities and
policies concerning the employment, training, health and safety and community
support and social development concerning the group’s employees in South
Africa.

Dividend

The directors recommend the payment of a dividend of 3.5p per share (2007:
3.00p) on the ordinary share capital for the year under review. The dividend
will be payable on Monday 10 August 2009 to shareholders registered at the
close of business on 4 July 2009. The ex-dividend date will be 2 July 2009.

Investment properties

The investment property portfolio is stated at its open market value of ?
11,773,000, at 31 December 2008 (2007:?14,725,000) as valued by professional
external valuers.

Financial instruments

Note 22 to the financial statements sets out the risks in respect of financial
instruments. The Board reviews and agrees overall treasury policies, delegating
appropriate authority to the managing director. Financial instruments are used
to manage the financial risks facing the group – speculative transactions are
not permitted. Treasury operations are reported at each Board meeting and are
subject to weekly internal reporting. Derivatives have been put in place, as
required by the group’s bankers to reduce interest rate risk.

Directors

The directors of the company for the whole year were M A Heller, A R Heller, C
A Joll, T M Kearney and J A Sibbald. R J Grobler, who is a South African
citizen, was appointed to the board by the directors on 22 April 2008. A
proposal for his election will be made at the AGM and is recommended by the
board. The directors retiring by rotation are A R Heller, C A Joll and J A
Sibbald who offer themselves for re-election. The board recommends their
re-appointment.

Robert Grobler was appointed as General Mine Manager by Black Wattle Colliery
(Proprietary) Limited on 1 May 2000. He was appointed to the board of Bisichi
Mining PLC as Director of Mining on 22 April 2008. He has over 40 years
experience in the South African coal mining industry. He is a professional
engineer and member of the South African Coal Managers Association.

Andrew Heller has been an executive director since 1998. He is a Chartered
Accountant and has been employed by the group since 1994 under a contract of
employment determinable at three months notice.

Christopher Joll has been a director since 2001 and has a contract of service
determinable at three months notice. He holds a number of non-executive
directorships of un-quoted companies. He is chairman of BLJ Financial Limited,
a financial public relations company, which provides services to the group.

John Sibbald has been a non-executive director since 1988. He is a retired
chartered accountant. For most of his career he was employed in stockbroking in
the City of London where he specialised in mining and international investment.
He has a contract of service determinable at three months notice.

No director had any material interest in any contract or arrangement with the
company during the year other than as shown in this report.

Directors’ shareholdings

The interests of the directors in the shares of the company, including family
and trustee holdings where appropriate, were as follows:

Beneficial Non-beneficial

31.12.2008 1.1.2008 31.12.2008 1.1.2008

M A Heller 146,666 146,666 181,334 181,334

A R Heller 772,000 772,000 – –

C A Joll 5,000 5,000 – –

T M Kearney 57,500 35,000 – –

J A Sibbald – – – –

R J Grobler (from appointment – – – –
on 22 April 2008)

There have been no changes in the above shareholdings since 31 December 2008.

Details of the options to subscribe for new ordinary shares of the company
granted to the directors are contained under ‘Share option schemes’ in the
remuneration report on page 24.

Substantial interests

The following have advised that they have an interest in 3 per cent or more of
the issued share capital of the company as at 17 April 2009:

London & Associated Properties PLC – 4,355,752 shares representing 41.68 per
cent of the issued capital.

M A Heller is a director and shareholder of London & Associated Properties PLC.

M A Heller – 328,000 shares representing 3.14 per cent of the issued capital.

A R Heller – 772,000 share representing 7.39 per cent of the issued capital.

Neil Kirton – 382,000 shares representing 3.65 per cent of the issued capital.

Disclosure of information to auditors

The directors in office at 31 December 2008 have confirmed that they are aware
that there is no relevant audit information of which the auditors are unaware.
Each of the directors has confirmed that they have taken all the steps they
ought to have taken as directors to make themselves aware of any relevant audit
information and to establish that it has been communicated to the auditor.

Corporate governance

The company has adopted the Guidance for Smaller Quoted Companies published by
the Quoted Companies Alliance (QCA). The QCA provides guidance to companies
outside the FTSE 350 index, referred to generally as SQCs. The QCA’s guidance
covers the implementation of the Combined Code on Corporate Governance for SQCs
and the paragraphs below set out how the company has applied this guidance
during the year. The company has complied with the QCA’s guidance throughout
the year.

Principals of corporate governance

The group’s Board appreciates the value of good corporate governance not only
in the areas of accountability and risk management, but also as a positive
contribution to business prosperity. The Board endeavours to apply corporate
governance principals in a sensible and pragmatic fashion having regard to the
individual circumstances of the group’s business. The key objective is to
enhance and promote shareholder value.

Board structure

During the year the Board comprised the executive chairman, the managing
director, two other executive directors, and two non-executive directors. Their
details appear on page 24. The Board is responsible to shareholders for the
proper management of the group. A statement of directors’ responsibilities in
respect of the accounts is set out on page 29.

The non-executive directors have a particular responsibility to ensure that the
strategies proposed by the executive directors are fully considered. To enable
the Board to discharge its duties, all directors have full and timely access to
all relevant information and there is a procedure for all directors, in
furtherance of their duties, to take independent professional advice, if
necessary, at the expense of the group. The Board has a formal schedule of
matters reserved to it and meets bi-monthly. It is responsible for overall
group strategy, approval of major capital expenditure projects and
consideration of significant financing matters.

The following committees, which have written terms of reference, deal with
specific aspects of the group’s affairs:

* The nomination committee is chaired by C A Joll and comprises the
non-executive directors and the executive chairman. The committee is
responsible for proposing candidates for appointment to the Board, having
regard to the balance and structure of the Board. In appropriate cases
recruitment consultants are used to assist the process. All Directors are
subject to re-election at least every three years.

* The remuneration committee is responsible for making recommendations to the
Board on the company’s framework of executive remuneration and its cost. The
committee determines the contract terms, remuneration and other benefits for
each of the executive directors, including performance related bonus schemes,
pension rights and compensation payments. The Board itself determines the
remuneration of the non-executive directors. The committee comprises the
non-executive directors. It is chaired by C A Joll. The executive chairman is
normally invited to attend meetings. The report on directors’ remuneration is
set out on pages 26 and 27.

* The audit committee comprises the two non-executive directors and is chaired
by C A Joll. Its prime tasks are to review the scope of external audit, to
receive regular reports from PKF aand to review the half-yearly and annual
accounts before they are presented to the Board, focusing in particular on
accounting policies and areas of management judgment and estimation. The
committee is responsible for monitoring the controls which are in force to
ensure the integrity of the information reported to the shareholders The
committee acts as a forum for discussion of internal control issues and
contributes to the Board’s review of the effectiveness of the group’s internal
control and risk management systems and processes. The committee also considers
the need for an internal audit function. It advises the board on the
appointment of external auditors and on their remuneration for both audit and
non-audit work, and discusses the nature and scope of the audit with the
external auditors. The committee, which meets formally at least once a year,
provides a forum for reporting by the group’s external auditors. Meetings are
also attended, by invitation, by the managing director and director of finance.

The audit committee also undertakes a formal assessment of the auditors’
independence each year which includes:

* a review of non-audit services provided to the group and related fees;

* discussion with the auditors of a written report detailing all relationships
with the company and any other parties that could affect independence or the
perception of independence;

* a review of the auditors’ own procedures for ensuring the independence of the
audit firm and partners and staff involved in the audit, including the regular
rotation of the audit partner; and

* obtaining written confirmation from the auditors that, in their professional
judgement, they are independent.

The audit committee report is set out on page 28.

An analysis of the fees payable to the external audit firm in respect of both
audit and non-audit services during the year is set out in note 5 to the
financial statements.

Performance evaluation – board, board committees and directors

The performance of the board as a whole and of its committees and the
non-executive directors is assessed by the chairman and the managing director
and is discussed with the senior independent director. Their recommendations
are discussed at the nomination committee prior to proposals for re-election
being recommended to the board. The performance of executive directors is
discussed and assessed by the remuneration committee. The senior independent
director meets regularly with the chairman and both the executive and
non-executive directors individually outside of formal meetings. The directors
will take outside advice in reviewing performance but have not found this
necessary to date.

Board and board committee meetings

The number of meetings during 2008 and attendance at regular board meetings and
board committees was as follows:

Meetings held Meetings
attended

M A Heller Board 5 5

Nomination committee 0 0

A R Heller Board 5 5

Audit committee 2 2

R J Grobler Board (appointed 22 April 3 1
2008)

C A Joll Board 5 5

Audit committee 2 2

Nomination committee 0 0

Remuneration committee 1 1

T M Kearney Board 5 5

Audit committee 2 1

J A Sibbald Board 5 5

Audit committee 2 2

Nomination committee 0 0

Remuneration committee 1 1

The audit committee had two meetings in 2008 with the external auditors
present, prior to release of the 2007 annual results. Members of the committee
discussed the 30 June 2008 half year results prior to their approval by the
full Board. The business of the nomination committee was dealt with at Board
meetings and the committee held no individual meetings.

Independent Directors

The senior independent non-executive director is Christopher Joll. The other
independent non-executive director is John Sibbald. Christopher Joll is a
minority shareholder and director of BLJ Financial Limited, a company which
provides financial public relations services to the company on an ad hoc basis
in relation to specific transactions.

John Sibbald has been a director for over twenty years. For these reasons the
criteria for independence set out in the Combined Code are not entirely met.
However the Board considers that Mr Joll and Mr Sibbald are both independent
directors and that their independence is not impaired by their failure to meet
these criteria.

The independent directors regularly meet prior to Board meetings to discuss
corporate governance issues.

Internal control

The directors are responsible for the group’s system of internal control and
review of its effectiveness at least annually. The Board has designed the
group’s system of internal control in order to provide the directors with
reasonable assurance that its assets are safeguarded, that transactions are
authorised and properly recorded and that material errors and irregularities
are either prevented or would be detected within a timely period. However, no
system of internal control can eliminate the risk of failure to achieve
business objectives or provide absolute assurance against material misstatement
or loss.

The key elements of the control system in operation are:

* The Board meets regularly with a formal schedule of matters reserved to it
for decision and has put in place an organisational structure with clear lines
of responsibility defined and with appropriate delegation of authority;

* There are established procedures for planning, approval and monitoring of
capital expenditure and information systems for monitoring the group’s
financial performance against approved budgets and forecasts;

* UK property and financial operations are closely monitored by members of the
Board and senior managers to enable them to assess risk and address the
adequacy of measures in place for its monitoring and control. The South African
operations are closely supervised by the UK based executives through daily,
weekly and monthly reports from the directors and senior officers in South
Africa. This is supplemented by frequent visits by the UK executives to the
South African based operations which include checking the integrity of
information supplied to the UK. The directors are guided by ‘Internal Control
Guidance for Directors on the Combined Code’ as issued by the Institute of
Chartered Accountants in England and Wales.

During the period, the audit committee has reviewed the effectiveness of
internal control as described above. The Board receives periodic reports from
all its committees.

There are no significant issues disclosed in the report and financial
statements for the year ended 31 December 2008 and up to the date of approval
of the report and financial statements that have required the Board to deal
with any related material internal control issues. The directors confirm that
the Board has reviewed the effectiveness of the system of internal control as
described during the period.

Communication with shareholders

Communication with shareholders is given a high degree of priority. Extensive
information about the group and its activities is given in the Annual Report
and Accounts, and the Half-year Report, which are sent to shareholders. Further
information is available on the company’s website, www.bisichi.co.uk. There is
a regular dialogue with institutional investors. Enquiries from individuals on
matters relating to their shareholdings and the business of the group are dealt
with informatively and promptly.

Payment of suppliers

The company agrees terms of contracts when orders are placed. It is company
policy that payments to suppliers are made in accordance with those terms,
provided that suppliers also comply with all relevant terms and conditions.
Trade creditors outstanding at the year end represented 2.9 days trade
purchases (2007 – 15.7 days).

Takeover Directive

The company has one class of share capital, ordinary shares. Each ordinary
share carries one vote. All the ordinary shares rank pari passu. There are no
securities issued in the company which carry special rights with regard to
control of the company. The identity of all significant direct or indirect
holders of securities in the company and the size and nature of their holdings
is shown in ‘Substantial interests’.

A relationship agreement dated 15 September 2005 (the ‘Relationship Agreement’)
was entered into between the company and London & Associated properties PLC
(‘LAP’) in regard to the arrangements between them while LAP is a controlling
shareholder of the company. The Relationship Agreement includes a provision
under which LAP has agreed to exercise the voting rights attached to the
ordinary shares in the company owned by LAP to ensure the independence of the
Board of directors of the company.

Other than the restrictions contained in the Relationship Agreement, there are
no restrictions on voting rights or on the transfer of ordinary shares in the
company. The rules governing the appointment and replacement of directors,
alteration of the articles of association of the company and the powers of the
company’s directors accord with usual English company law provisions. Each
director is re-elected every three years or less. The company has not requested
authority from its shareholders to buy back its own ordinary shares.

The company is not party to any significant agreements that take effect, alter
or terminate upon a change of control of the company following a takeover bid.
The company is not aware of any agreements between holders of its ordinary
shares that may result in restrictions on the transfer of its ordinary shares
or on voting rights.

There are no agreements between the company and its directors or employees
providing for compensation for loss of office or employment that occurs because
of a takeover bid.

Annual General Meeting

The annual general meeting will be held at the Company’s offices at 30-35 Pall
Mall, London SW1Y 5LP on 11 June 2009 at 11.00 a.m. Items 1 to 9 will be
proposed as ordinary resolutions. More than 50 per cent of shareholders’ votes
must be in favour for these resolutions to be passed. Item 10 will be proposed
as a special resolution. At least 75 per cent of shareholders’ votes must be in
favour for this resolution to be passed. The directors consider that all of the
resolutions to be put to the meeting are in the best interests of the Company
and its shareholders as a whole. The board recommends that shareholders vote in
favour of all of the resolutions.

A special resolution will be proposed at the Annual General Meeting in respect
of this disapplication
of pre-emption rights. :

Disapplication of pre-emption rights

Shares allotted for cash must normally first be offered to shareholders in
proportion to their existing shareholdings. The directors will, at the
forthcoming Annual General Meeting of the company (Resolution 10), seek power
to allot shares as if the pre-emption rights contained in Section 89(1) of the
Companies Act 1985 did not apply up to a maximum of 10% of the company’s issued
share capital. The authority will expire at the earlier of the conclusion of
the company’s next annual general meeting and 15 months from the passing of
Resolution 10.

Donations

No political or charitable donations were made during the year (2007:Nil).

Going concern

The directors confirm that they have a reasonable expectation that the group
has adequate resources to continue in operational existence for the foreseeable
future. For this reason, the going concern basis has been adopted in the
preparation of the financial statements.

Other matters

PKF (UK) LLP has expressed its willingness to continue in office as auditors. A
proposal will be made at the annual general meeting for its re-appointment, and
for its remuneration to be determined by the directors.

By order of the board

M C Stevens,

Secretary

30-35 Pall Mall

London SW1Y 5LP

17 April 2009

OUR MANAGEMENT TEAM

Michael Heller

Chairman

Bisichi Mining PLC

Andrew Heller

Managing Director

Bisichi Mining PLC,

Managing Director, Black Wattle Colliery

Robert Grobler

Director of Mining

Bisichi Mining PLC,

Director Black Wattle Colliery

Robert Corry

Chairman

Black Wattle Colliery

Thomas Kearney

Commercial Director

Bisichi Mining PLC,

Director Black Wattle Colliery

Christopher Joll

Senior Independent Director

Chairman, Audit and Remuneration Committees

David Nkosi

Director

Black Wattle Colliery

Luis Pinel

General Manager

Black Wattle Colliery

DIRECTORS & ADVISORS

*Michael A Heller

MA, FCA (Chairman)

Andrew R Heller

MA, ACA

(Managing Director)

Robert Grobler

Pr Cert Eng

(Director of mining)

Thomas M Kearney

MA (Commercial Director)

O+Christopher A Joll

MA (Non-executive)

Christopher Joll was appointed a Director on 1 February 2001. He holds a number
of non-executive directorships of un-quoted companies. He is chairman of BLJ
Financial Limited, a financial public relations consultancy.

OJohn A Sibbald

BL (Non-executive)

John Sibbald has been a Director since 1988. After qualifying as a Chartered
Accountant he spent over 20 years in stockbroking, specialising in mining and
international investment.

*Member of the nomination committee

+ Senior independent director

O Member of the audit, nomination and remuneration committees.

Secretary & Registered office

Michael C Stevens FCA

30-35 Pall Mall

London SW1Y 5LP

Black Wattle Colliery

Directors

Robert Corry (Chairman)

Andrew Heller

(Managing Director)

Robert Grobler

Tom Kearney

David Nkosi

Director of Property

Mike J Dignan FRICS

Auditors

PKF (UK) LLP

Principal bankers

United Kingdom

Barclays Bank PLC

National Westminster Bank PLC

South Africa

ABSA Bank (SA)

First National Bank (SA)

Standard Bank (SA)

Corporate solicitors

United Kingdom

Olswang LLP, London

South Africa

Leppan Beech, Johannesburg

Routledge Modise, Johannesburg

Tugendhaft Wapnick Banchetti and Partners, Johannesburg

Stockbrokers

Numis Securities

Registrars and transfer office

Capita Registrars, Northern House, Woodsome Park, Fenay Bridge, Huddersfield,
West Yorkshire HD8 0LA

Telephone 0871 664 0300

(Calls cost 10p per minute + network extras) or

+44 208 639 3399 for overseas callers

Website: www.capitaregistrars.com

Email: ssd@capitaregistrars.com

Company registration No. 112155

(Incorporated in England and Wales)

Website

www.bisichi.co.uk

E-mail

admin@bisichi.co.uk

FIVE YEAR FINANCIAL SUMMARY

2008 2007 2006 2005 2004

?’000 ?’000 ?’000 ?’000 ?’000

Consolidated profit and loss
account

Revenue 25,979 16,693 13,239 13,485 11,548

Operating (loss)/profit 2,616 (191) 2,362 4,664 4,385

(Loss)/Profit before tax 2,117 (459) 2,172 4,206 4,011

Realised profit/(loss) before tax 6,031 2,302 273 1114 2051

Unrealised (loss)/profit before tax (3,914) (2,761) 1,899 3092 1960

Consolidated balance sheet

Investment properties 11,773 14,725 17,270 15,625 14,990

Fixed asset investments 3,406 2,991 3,028 2,943 1,860

15,179 17,716 20,298 18,568 16,850

Current asset investments 627 770 700 629 403

15,806 18,486 20,998 19,197 17,253

Other assets less liabilities (160) (3,127) (5,668) (4,578) (4,254)

Consolidated shareholders funds per 15,646 15,359 15,330 14,619 12,999
balance sheet

Adjustment of current asset – – – – 123
investments
to market value

Consolidated shareholders funds* 15,646 15,359 15,330 14,619 13,122

Net assets per ordinary share* 149.7p 147.0p 146.7p 139.9p 125.6p

Dividend per share 3.50p 3.0p 2.50p 2.25p 2.00p

* Based on net assets including the investment portfolio at market value.

FINANCIAL CALENDAR

11 June 2009 Annual General Meeting

10 August 2009 Payment of final dividend for 2008 (if approved)

Late August 2009 Announcement of interim results to 30 June 2009

Late April 2010 Announcement of results for the year ending 31
December 2009

REMUNERATION REPORT

The remuneration committee is pleased to present its report for the year ended
31 December 2008. The remuneration committee is a formally constituted
committee and is comprised exclusively of non-executive directors. The members
of the committee are Christopher Joll (chairman) and John Sibbald.

Remuneration policy for executive directors and non-executive directors

The principal function of the remuneration committee is to determine, on behalf
of the board, the remuneration and other benefits of the executive directors
and senior executives, including pensions, share options and service contracts.
The company’s policy is to ensure that the executive directors are rewarded
competitively in relation to other companies in order to retain and motivate
them. The emoluments of each executive director comprises basic salary, a bonus
at the discretion of the remuneration committee, provision of a car, premiums
paid in respect of individual defined contribution pension arrangements, health
insurance premium and share options.

The remuneration of non-executive directors is determined by the board, and
takes into account additional remuneration for services outside the scope of
the ordinary duties of non-executive directors. No pension costs are incurred
on behalf of non-executive directors and they do not participate in the share
option schemes.

Service and employment contracts

All executive directors have full time contracts of employment with the
company. Non-executive directors have contracts of service. No director has a
contract of employment or contract of service with the company, its joint
venture or associated companies with a fixed term which exceeds six months. All
directors’ contracts, as amended from time to time, have run from the date of
appointment. Details of the directors standing for re-election are given under
‘Directors’ in the directors’ report. The policy of the committee is not to
grant employment contracts or contracts of service in excess of six months and
there are no provisions for termination payments. A summary of terms of service
and employment is as follows:

Date Unexpired Notice

of contract term period

Executive directors

M A Heller November 1972 Continuous 6 months

A R Heller January 1994 Continuous 3 months

T M Kearney November 2003 Continuous 3 months

R J Grobler April 2008 Continuous 3 months

Non-executive
directors

C A Joll February 2001 Continuous 3 months

J A Sibbald October 1988 Continuous 3 months

The following information has been audited:

Directors’ remuneration

Salaries Bonus Benefits Total Pension Total Total
and Fees before contibutions 2008 2007
pensions

?’000 ?’000 ?’000 ?’000 ?’000 ?’000 ?’000

Executive directors

M A Heller 75 100 – 175 – 175 75

A R Heller 300 600 36 936 25 961 716

T M Kearney 185 125 18 328 18 346 476

R Grobler 117 73 10 200 3 203 –

677 898 64 1,639 46 1,685 1,267

Non-executive
directors

C A Joll 20 – – 20 – 20 20

J A Sibbald 2 – 3 5 – 5 4

22 – 3 25 – 25 24

Total 699 898 67 1,664 46 1,710 1,391

Pension schemes and incentives

Three (2007:two) directors have benefits under money purchase pension schemes.
Contributions in 2008 were ?46,000 (2007:?56,000), see table above. Directors
are not entitled to benefits under any bonus or incentive schemes apart from
the share option schemes details of which are set out below. Bonuses are
awarded by the remuneration committee when merited.

Performance bonuses were awarded by the remuneration committee to four
executive directors during 2008 (2007:2).

Share option schemes

The company has three ‘Unapproved’ Share Option Schemes which are not subject
to HM Revenue and Customs (HMRC) approval. The ‘First Scheme’ was approved by
shareholders on 15 June 1999. The ‘Second Scheme’ was approved by shareholders
on 23 June 2005, options having been provisionally granted under it on 23
September 2004, and the ‘2006 Scheme’ was approved by shareholders on 29 June
2006. All available options under the three schemes have been granted.

Number of share
options

Option 1 Granted 31 Exercisable Exercisable
price* January in December
2008 from to
2008 2008

First Scheme

A R Heller 34p 233,000 – 233,000 30/9/2005 29/9/2012

Employee 34p 80,000 – 80,000 30/9/2005 29/9/2012

Second Scheme

A R Heller 149p 80,000 – 80,000 23/9/2007 22/9/2014

T M Kearney 149p 120,000 – 120,000 23/9/2007 22/9/2014

The 2006 Scheme

A R Heller 237.5p 275,000 – 275,000 4/10/2009 3/10/2016

T M Kearney 237.5p 275,000 – 275,000 4/10/2009 3/10/2016

Employee 237.5p 50,000 – 50,000 4/10/2009 3/10/2016

*Middle market price at date of grant

The exercise of options under the Unapproved Share Option Schemes is subject to
the satisfaction of objective performance conditions specified by the
remuneration committee, which will conform to institutional shareholder
guidelines and best practice provisions in force from time to time. The
remuneration committee has not yet set these guidelines for the first scheme
and the 2006 scheme. The performance conditions for the second scheme, agreed
by members on 23 June 2005, requires growth in net assets over a three year
period to exceed the growth of the retail prices index by a scale of
percentages.

The middle market price of Bisichi Mining PLC ordinary shares at 31 December
2008 was 140p (2006-265p).

During the year the share price ranged between 455p and 135p.

The following information is unaudited:

The board’s policy is to grant options to executive directors, managers and
staff at appropriate times to provide them with

an interest in the longer term development of the group.

C A Joll

Chairman – remuneration committee

30-35 Pall Mall

London SW1Y 5LP

17 April 2009

AUDIT COMMITTEE REPORT

The committee’s terms of reference have been approved by the board and follow
published guidelines, which are available from the company secretary. The audit
committee comprises the two non-executive directors, Christopher Joll
(chairman), an experienced financial PR executive and John Sibbald, a retired
chartered accountant.

The Audit Committee’s prime tasks are to :

Review the scope of external audit, to receive rregular reports from PKF (UK)
LLP and to review the half-yearly and annual accounts before they are presented
to the board, focusing in particular on accounting policies and areas of
management judgment and estimation;

Monitor the controls which are in force to ensure the integrity of the
information reported to the shareholders;

Act as a forum for discussion of internal control issues and contribute to the
board’s review of the effectiveness of the group’s internal control and risk
management systems and processes;

Consider each year the need for an internal audit function;

Advise the board on the appointment of external auditors and rotation of the
audit partner every five years, and on their remuneration for both audit and
non-audit work, and discuss the nature and scope of their audit work;

Undertake a formal assessment of the auditors’ independence each year which
includes:

* a review of non-audit services provided to the group and related fees;

* discussion with the auditors of a written report detailing all relationships
with the company and any other parties that could affect independence or the
perception of independence;

* a review of the auditors’ own procedures for ensuring the independence of the
audit firm and partners and staff involved in the audit, including the regular
rotation of the audit partner; and

* obtaining written confirmation from the auditors that, in their professional
judgement, they are independent.

Meetings

The committee meets prior to the annual audit with the external auditors to
discuss the audit plan and again prior to the publication of the annual
results. These meetings are attended by the external audit partner, managing
director, director of finance and company secretary. Prior to bi-monthly board
meetings the members of the committee meet on an informal basis to discuss any
relevant matters which may have arisen. Additional formal meetings are held as
necessary.

During the past year the committee:

Met with the external auditors, and discussed their report to the Audit
Committee;

Approved the publication of annual and half-year financial results;

Considered and approved the annual review of internal controls;

Decided that due to the size and nature of operations there was not a current
need for an internal audit function;

Agreed the independence of the auditors and approved their fees for both audit
and non-audit services as set out in note 5 to the financial statements.

External Auditors

PKF (UK) LLP held office throughout the year. In the United Kingdom the company
is provided with extensive administration and accounting services by London &
Associated Properties PLC which has its own audit committee and employs a
separate firm of external auditors, Baker Tilly UK Audit LLP. In South Africa
PKF (Jhb) Inc. is the external auditor to the South African companies, and the
work of that firm is reviewed by PKF (UK) LLP.

C A Joll
Chairman – audit committee

30-35 Pall Mall
London SW1Y 5LP
17 April 2009

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

The directors are responsible for preparing the annual report and the financial
statements in accordance with applicable law and regulations. They are also
responsible for ensuring that the annual report includes information required
by the Listing Rules of the Financial Services Authority.

Company law requires the directors to prepare financial statements for each
financial year. Under that law the directors are required to prepare the group
financial statements in accordance with International Financial Reporting
Standards as adopted by the European Union and have elected to prepare the
parent company financial statements in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom Accounting Standards and
applicable law). The financial statements are required to give a true and fair
view of the state of affairs of the company and the group and of the profit or
loss of the group for that period. In preparing these financial statements the
directors are required to:

– select suitable accounting policies and then apply them consistently;

– make judgements and estimates that are reasonable and prudent;

– state in the parent company financial statements whether applicable
accounting standards have been followed, subject to any material departures
disclosed and explained in the parent company financial statements;

– prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the group and the company will continue in
business.

The directors are responsible for keeping proper accounting records that
disclose with reasonable accuracy at any time the financial position of the
company and the group and enable them to ensure that the financial statements
comply with the Companies Act 1985. They are also responsible for safeguarding
the assets of the group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the company’s website.
Legislation in the United Kingdom governing the preparation and dissemination
of the financial statements and other information included in annual reports
may differ from legislation in other jurisdictions.

The directors confirm, to the best of their knowledge:

(a) that the financial statements, which have been prepared in accordance with
IFRSs as adopted by the EU, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the company and of the
group taken as a whole; and

(b) the management report included within the Directors’ Report includes a fair
review of the development and performance of the business and the position of
the company and the group taken as a whole, together with a description of the
principal risks and uncertainties that they face.

VALUERS’ CERTIFICATES

To the directors of Bisichi Mining PLC

In accordance with your instructions we have carried out a valuation of the
freehold property interests held as at 31 December 2008 by the company as
detailed in our Valuation Report dated 10 February 2009.

Having regard to the foregoing, we are of the opinion that the open market
value as at 31 December 2008 of the interests owned by the Company was ?
8,673,000 being made up as follows:

?000

Freehold 8,673

8,673

Leeds Atisreal Limited

10 February 2009 Chartered Surveyors

To the directors of Bisichi Mining PLC

In accordance with your instructions we have carried out a valuation of the
leasehold property interests held as at 31 December 2008 by the company as
detailed in our Valuation Report dated 10 February 2009.

Having regard to the foregoing, we are of the opinion that the open market
value as at 31 December 2008 of the interests owned by the Company was ?
3,100,000 being made up as follows:

?000

Leasehold 3,100

3,100

Leeds Carter Towler

10 February 2009 Chartered Surveyors

INDEPENDENT AUDITORS’ REPORT

TO THE MEMBERS OF BISICHI MINING PLC

We have audited the group and parent company financial statements (‘the
financial statements’) of Bisichi Mining PLC for the year ended 31 December
2008 which comprise the consolidated income statement, the consolidated balance
sheet, the consolidated statement of changes in shareholders’ equity, the
consolidated cash flow statement, the company balance sheet and the related
notes. These financial statements have been prepared under the accounting
policies set out therein. We have also audited the information in the
remuneration report that is described as having been audited.

This report is made solely to the company’s members, as a body, in accordance
with Section 235 of the Companies Act 1985. Our audit work has been undertaken
so that we might state to the company’s members those matters we are required
to state to them in an auditor’s report, and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company’s members as a body, for our
audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditors

The directors’ responsibilities for preparing the annual report, the
remuneration report and the financial statements in accordance with applicable
law and for preparing the group financial statements in accordance with
International Financial Reporting Standards (‘IFRSs’) as adopted by the
European Union and the parent company financial statements in accordance with
United Kingdom accounting standards (‘United Kingdom Generally Accepted
Accounting Practice’) are set out in the directors’ responsibility statement.

Our responsibility is to audit the financial statements and the part of the
remuneration report to be audited in accordance
with relevant legal and regulatory requirements and International Standards on
Auditing (UK and Ireland).

We report to you our opinion as to whether the financial statements give a true
and fair view and whether the financial statements and the part of the
remuneration report to be audited have been properly prepared in accordance
with the Companies Act 1985 and whether in addition, the group financial
statements have been properly prepared in accordance with Article 4 of the IAS
regulation. We also report to you whether, in our opinion, the information
given in the Directors’ Report is consistent with the financial statements. The
information in the Directors’ Report includes that specific information
presented in the Chairman’s Statement, Mining Review and Business Review that
is cross referenced from the business review section of the directors’ report.

In addition we report to you if, in our opinion, the company has not kept
proper accounting records, if we have not received all the information and
explanations we require for our audit, or if information specified by law
regarding directors’ remuneration and other transactions is not disclosed.

We review whether the corporate governance statement reflects the company’s
compliance with the nine provisions of the 2006 Combined Code specified for our
review by the Listing Rules of the Financial Services Authority, and we report
if it does not. We are not required to consider whether the board’s statements
on internal control cover all risks and controls, or form an opinion on the
effectiveness of the group’s corporate governance procedures or its risk and
control procedures.

We read other information contained in the Annual Report and consider whether
it is consistent with the audited financial statements.

This other information comprises only the Directors’ Report, the unaudited part
of the remuneration report, the Chairman’s Statement, the Mining Review, the
Business Review, the Audit Committee report and the Valuers’ certificates. We
consider the implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the financial statements. Our
responsibilities do not extend to any other information.

Basis of audit opinion

We conducted our audit in accordance with International Standards on Auditing
(UK and Ireland) issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements and the part of the remuneration report
to be audited. It also includes an assessment of the significant estimates and
judgments made by the directors in the preparation of the financial statements,
and of whether the accounting policies are appropriate to the group’s and
company’s circumstances, consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
and the part of the remuneration report to be audited are free from material
misstatement, whether caused by fraud or other irregularity or error. In
forming our opinion we also evaluated the overall adequacy of the presentation
of information in the financial statements and the part of the remuneration
report to be audited.

Opinion

In our opinion:

* the group financial statements give a true and fair view, in accordance with
IFRSs as adopted by the European

Union, of the state of the group’s affairs as at 31 December 2008 and of its
profit for the year then ended;

* the group financial statements have been properly prepared in accordance with
article 4 of the IAS regulation;

* the parent company financial statements give a true and fair view, in
accordance with United Kingdom Generally

Accepted Accounting Practice, of the state of the parent company’s affairs as
at 31 December 2008;

* the financial statements and the part of the remuneration report to be
audited have been properly prepared

in accordance with the Companies Act 1985; and

* the information given in the Directors’ Report is consistent with the
financial statements.

PKF (UK) LLP

Registered auditors

London, UK

20 April 2009

CONSOLIDATED INCOME STATEMENT
for the year ended 31 December 2008

2008 2007

Notes Realised Unrealised Total Total

?’000 ?’000 ?’000 ?’000

Group Revenue 1 25,979 – 25,979 16,693

Operating costs (19,754) – (19,754) (14,710)

Operating profit on trading 1 6,225 – 6,225 1,983
activities

Decrease in value of 3 – (3,075) (3075) (2,588)
investment properties

Losses on held for trading – (534) (534) 31
investments

Exceptional items 4 – – – 383

Operating profit/(loss) 1 6,225 (3,609) 2,616 (191)

Share of loss in joint 14 – (305) (305) (204)
ventures

Profit/(loss) before interest 6,225 (3,914) 2,311 (395)
and taxation

Interest receivable 345 – 345 394

Interest payable 7 (539) – (539) (458)

Profit/(loss) before tax 5 6,031 (3,914) 2,117 (459)

Taxation 8 (2,394) 583 (1,811) 551

Profit/(loss) for the year 3,637 (3,331) 306 92

Attributable to: 3,633 (3,331) 302 92

Equity holders of the company

Minority interest 27 4 – 4 –

Profit/(loss) for the year 3,637 (3,331) 306 92

Earnings per share – basic 10 34.76 p (31.87)p 2.89p 0.88p

Earnings per share – diluted 10 33.99p (31.16)p 2.83p 0.85p

Realised income reflects all the mining and property operations. Unrealised
income reflects the fixed asset revaluations and joint ventures, where the
income has not actually been received.

CONSOLIDATED BALANCE SHEET
at 31 December 2008

2008 2007

Notes ?’000 ?’000

Assets

Non-current assets

Value of investment properties 11 11,773 14,725
attributable to group

Fair value of head lease 234 267

Property 12,007 14,992

Mining reserves, plant and equipment 12 7,554 5,859

Investments in joint ventures 13 3,072 2,520

Other Investments 13 334 471

Total non-current assets 22,967 23,842

Current assets

Inventories 16 1,397 126

Trade and other receivables 17 5,524 2,130

Corporation tax recoverable 15 174

Held for trading investments 18 627 770

Interest derivative – 16

Cash and cash equivalents 3,414 3,199

Total current assets 10,977 6,415

Total assets 33,944 30,257

Liabilities

Current liabilities

Borrowings 20 (6,877) (2,402)

Trade and other payables 19 (5,815) (5,606)

Current tax liabilities (1,645) (454)

Total current liabilities (14,337) (8,462)

Non current liabilities

Borrowings 20 (541) (3139)

Provision for rehabilitation 21 (571) –

Finance lease liabilities 31 (234) (267)

Deferred tax liabilities 23 (2,625) (3030)

Total non current liabilities (3,971) (6,436)

Total liabilities (18,308) (14,898)

Net assets 15,636 15,359

Equity

Share capital 24 1,045 1,045

Translation reserve (1,215) (1,276)

Other reserves 25 663 426

Retained earnings 15,153 15,164

Total equity attributable to equity 15,646 15,359
shareholders

Minority interest 27 (10) –

Total equity 15,636 15,359

These financial statements were approved and authorised for issue by the board
of directors on 17 April 2009 and signed on its behalf by:

M A Heller A R Heller

Director Director

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
for the year ended 31 December 2008

Share Translation Other Retained Total Minority Total
capital reserves reserves earnings interest equity

?’000 ?’000 ?’000 ?’000 ?’000 ?’000 ?’000

Balance at 1 1,045 (1,237) 189 15,333 15,330 – 15,330
January 2007

Revaluation of – – – (2,588) (2,588) – (2,588)
investment
properties

Movement on fair – – – 16 16 – 16
value of
derivatives

Other income – – – 2,664 2,664 – 2,664
statement
movements

Profit for the – – – 92 92 – 92
year

Exchange – (39) – – (39) – (39)
adjustment

Total recognised – (39) – 92 53 – 53
income and
expense for the
year

Dividend – – – (261) (261) – (261)

Equity share – – 237 – 237 – 237
options

Balance at 1 1,045 (1,276) 426 15,164 15,359 – 15,359
January 2008

Revaluation of – – – (3,075) (3,075) – (3,075)
investment
properties

Movement on fair – – – 16 16 – 16
value of
derivatives

Other income – – – 3,361 3,361 4 3,365
statement
movements

Profit for the – – – 302 302 4 306
year

Exchange – 61 – – 61 – 61
adjustment

Total recognised – 61 – 302 363 4 367
income and
expense for the
year

Dividend – – – (313) (313) – (313)

Equity share – – 237 – 237 – 237
options

Purchase of – – – – – (14) (14)
additional
shares in
subsidiary

Balance at 31 1,045 (1,215) 663 15,153 15,646 (10) 15,636
December 2008

CONSOLIDATED CASH FLOW STATEMENT

for the year ended 31 December 2008

Year ended Year ended
31 December 2008 31 December
2007

?’000 ?’0000

Cash flows from operating activities

Operating profit /(loss) 2,616 (191)

Adjustments for:

Depreciation 2,072 1,196

Share based payment expense 237 237

Unrealised loss/(gain) on investment held for 534 (31)
trading

Unrealised loss on investment properties 3,075 2,588

Cash flow before working capital 8,534 3,799

Change in inventories (1,271) (69)

Change in trade and other receivables (4,134) (87)

Change in trade and other payables 636 (454)

Change in provisions 571 –

Acquisitions of held for trading investments (334) (89)

Proceeds from held for trading investments 12 50

Cash generated from operations 4,014 3,150

Interest received 345 394

Interest paid (539) (458)

Income tax paid (866) (43)

Cash flow from operating activities 2,954 3,043

Cash flows from investing activities

Acquisition of reserves, plant and equipment (3,941) (1,775)

Proceeds from sale of investment properties, 58 158
reserves,
plant and equipment

Acquisitions of investments (420) (78)

Cash flow from investing activities (4,303) (1,695)

Cash flows from financing activities

Borrowings drawn 847 163

Borrowings repaid (546) (990)

Equity dividends paid (313) (261)

Cash flow from financing activities (12) (1,088)

Net increase in cash and cash equivalents (1,361) 260

Cash and cash equivalents at 1 January 1,244 978

Exchange adjustment 1 6

Cash and cash equivalents at 31 December (116) 1,244

Cash and cash equivalents at 31 December
comprise:

Cash and cash equivalents as presented in the 3,414 3,199
balance sheet

Bank overdrafts (secured) (3,530) (1,955)

(116) 1,244

GROUP ACCOUNTING POLICIES
for the year ended 31 December 2008

Basis of accounting

The results for the year ended 31 December 2008 have been prepared in
accordance with International Financial Reporting Standards (IFRS) as adopted
by the European Union and with those parts of the Companies Act 1985 applicable
to companies reporting under IFRS. The principal accounting policies are
described below:

The group financial statements are presented in ? sterling and all values are
rounded to the nearest thousand pounds (?’000) except when otherwise stated.

International Accounting Standards (IAS/IFRS)
The financial statements are prepared in accordance with International
Financial Reporting Standards and Interpretations in force at the reporting
date. The group has not adopted any standards or interpretations in advance of
the required implementation dates. It is not expected that adoption of
standards or interpretations which have been issued by the International
Accounting Standards Board but have not been adopted will have a material
impact on the financial statements.

Of these standards:

* IFRS 8 ‘Operating Standards’ and

* IAS 1 ‘Presentation of financial statements’

would impact only on the presentation of these financial statements.

– IAS 27 ‘Consolidated and separate financial statements’ and

– IFRS 3 ‘Business combinations’

would only have an impact on future business combinations.

Key Judgements and Estimates

The directors consider their judgements and estimates surrounding the life of
the mine and its reserves to have the most significant effect on the amounts
recognised in the financial statements and to be the area where the financial
statements are at most risk of a material adjustment due to estimation
uncertainty.

In addition the directors note that other areas, in particular the valuation of
the investment properties, are considered to be less judgemental due to the
nature of the underlying properties and the use of external valuers.

Basis of consolidation

The group accounts incorporate the accounts of Bisichi Mining Plc and all of
its subsidiary undertakings, together with the group’s share of the results of
its joint ventures and associates.

Revenue

Revenue comprises sales of coal and property rental income. Revenue is
recognised when delivery of the product or service has been made and when the
customer has a legally binding obligation to settle under the terms of the
contract and has assumed all significant risks and rewards of ownership.

Revenue is only recognised on individual sales when all of the significant
risks and rewards of ownership have been transferred to a third party. In most
instances revenue is recognised when the product is delivered to the location
specified by the customer, which is typically when loaded into transport, where
the customer pays the transportation costs.

Rental income is recognised in the group income statement on a straight-line
basis over the term of the lease.

Investment Properties

Investment properties comprise freehold and long leasehold land and buildings.
Investment properties are carried at fair value in accordance with IAS 40
`Investment Properties’. Properties are recognised as investment properties
when held for long-term rental yields, and after consideration has been given
to a number of factors including length of lease, quality of tenant and
covenant, value of lease, management intention for future use of property,
planning consents and percentage of property leased. Investment properties are
revalued annually by professional external surveyors and included in the
balance sheet at their fair value. Gains or losses arising from changes in the
fair values of assets are recognised in the consolidated income statement in
the period to which they relate. In accordance with IAS 40, investment
properties are not depreciated. Properties held for use in the business or in
the course of restoration, renovation or held for development or sale, are not
recognised as investment properties and are held at depreciated historical
cost.

The fair value of the head leases is the net present value of the current head
rent payable on leasehold properties until the expiry of the lease.

Mining reserves, plant and equipment

The cost of property, plant and equipment comprises its purchase price and any
costs directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in accordance with agreed
specifications. Freehold land is not depreciated. Other property, plant and
equipment is stated at historical cost less accumulated depreciation. The life
of mine remaining is currently estimated at 5 years.

The provision for rehabilitation is carried at fair value and includes a
provision for restoration of the opencast operations which commenced in 2008.

Mine reserves and development cost

The purpose of mine development is to establish secure working conditions and
infrastructure to allow the safe and efficient extraction of recoverable
reserves. Depreciation on mine development is not charged until production
commences or the assets are put to use. On commencement of full production,
depreciation is charged over the life of the mine on a straight-line basis.

Surface mine development

Expenditure incurred prior to the commencement of working surface mine sites,
net of any residual value and taking into account the likelihood of the site
being mined, is capitalised within property, plant and equipment and charged to
the income statement over the life of the recoverable reserves of the scheme.

Other assets

The cost, less estimated residual value, of other property, plant and equipment
is written off on a straight-line basis over the asset’s expected useful life.
Residual values and useful lives are reviewed, and adjusted if appropriate, at
each balance sheet date. Changes to the estimated residual values or useful
lives are accounted for prospectively. Heavy surface mining and other plant and
equipment is depreciated at varying rates depending upon its expected usage.

The depreciation rates generally applied are:

Mining equipment The shorter of its useful life or the life of the mine

Mining reserves Over the expected life of the reserves

Motor vehicles 25-33 per cent per annum

Office equipment 10-33 per cent per annum

Employee Benefits

Share based remuneration

The company operates a share option scheme. The fair value of the share option
scheme is determined at the date of grant. This fair value is then expensed on
a straight-line basis over the vesting period, based on an estimate of the
number of shares that will eventually vest. The fair value of options granted
is calculated using a binomial model. Details of the share options in issue are
disclosed in the Directors Remuneration Report.

Pensions

The group operates a defined contribution pension scheme. The contributions
payable to the scheme are expensed in the period to which they relate.

Foreign Currencies

Monetary assets and liabilities are translated at year end exchange rates and
the resulting exchange rate differences are included in the consolidated income
statement within the results of operating activities if arising from trading
activities and within finance cost/income if arising from financing.

For consolidation purposes, income and expense items are included in the
consolidated income statement at average rates, and assets and liabilities are
translated at year end exchange rates. Translation differences arising on
consolidation are taken directly to reserves. Where foreign operations are
disposed of, the cumulative exchange differences of that foreign operation are
recognised in the consolidated income statement when the gain or loss on
disposal is recognised.

Transactions in foreign currencies are translated at the exchange rate ruling
on transaction date.

Financial Instruments

Bank loans and overdrafts

Bank loans and overdrafts are included as financial liabilities on the group
balance sheet at the amounts drawn on the particular facilities. Interest
payable on those facilities is expensed as a finance cost in the period to
which it relates.

Finance lease liabilities

Finance lease liabilities arise for those investment properties held under a
leasehold interest and accounted for as investment property. The liability is
initially calculated as the present value of the minimum lease payments,
reducing in subsequent reporting periods by the apportionment of payments to
the lessor.

Interest rate derivatives

The group uses derivative financial instruments to manage the interest rate
risk associated with the financing of the group’s business. No trading in such
financial instruments is undertaken. At each reporting date, these interest
rate derivatives are recognised at fair value, being the estimated amount that
the group would receive or pay to terminate the agreement at the balance sheet
date, taking into account current interest rates and the current credit rating
of the counterparties. The gain or loss at each fair value re-measurement is
recognised immediately in the income statement.

Held for trading investments

Financial assets/liabilities held for trading or short-term gain are measured
at fair value and movements in fair value are charged/credited to the income
statement in the period.

Trade receivables

Trade receivables do not carry any interest and are stated at their nominal
value as reduced by appropriate allowances for estimated recoverable amounts.

Trade payables

Trade payables are not interest bearing and are stated at their nominal value.

Other Financial assets and liabilities

The groups other financial assets and liabilities not disclosed above are fair
valued as shown below.

Financial assets:

– Cash and cash equivalents are measured at cash value.

– Other receivables at amount owed

– Other loans receivable at amount owed

Finance liabilities:

– Other payables at amount owing

Joint Ventures

Investments in joint ventures, being those entities over whose activities the
group has joint control, as established by contractual agreement, are included
at cost together with the group’s share of post acquisition reserves, on an
equity basis.

Inventories

Inventories are stated at the lower of cost and net realisable value. Cost
includes materials, direct labour and overheads relevant to the stage of
production. Net realisable value is based on estimated selling price less all
further costs to completion and all relevant marketing, selling and
distribution costs.

Other Investments

Other investments are recognised at cost less any provision for impairment.

Impairment

Whenever events or changes in circumstance indicate that the carrying amount of
an asset may not be recoverable an asset is reviewed for impairment. An asset’s
carrying value is written down to its estimated recoverable amount (being the
higher of the fair value less cost to sell and value in use) if that is less
than the asset’s carrying amount.

Deferred Tax

Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the tax computations, and is
accounted for using the balance sheet liability method. Deferred tax
liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary
differences can be utilised. In respect of the deferred tax on the revaluation
surplus, this is calculated on the basis of the chargeable gains that would
crystallise on the sale of the investment portfolio as at the reporting date.
The calculation takes account of indexation on the historical cost of the
properties and any available capital losses.

Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset is realised. Deferred tax is
charged or credited in the group income statement, except when it relates to
items charged or credited directly to equity, in which case it is also dealt
with in equity.

Dividends

Dividends payable on the ordinary share capital are recognised as a liability
in the period in which they are approved.

Cash and Cash Equivalents

Cash comprises cash in hand and on-demand deposits. Cash and cash equivalents
comprises short-term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes
in value and original maturities of three months or less. The cash and cash
equivalents shown in the cashflow statement are stated net of bank overdrafts.

Segmental Reporting

A business segment is a component of the group distinguishable by economic
activity (business segment), or by its geographical location (geographical
segment), which is subject to risks and returns that are different from those
of other business segments. The Group’s only business segments are mining
activities and investment properties. The Group also reports by geographical
segment. In presenting information on the basis of geographical segments,
segment assets and the cost of acquiring them are based on the geographical
location of the assets. Segment capital expenditure is the total cost incurred
during the period to acquire segment assets and are based on where the assets
are located.

NOTES TO THE FINANCIAL STATEMENTS
for the year ended 31 December 2008

1. Segmental reporting

Business analysis (primary segment)

2008

Mining Property Other Total

?’000 ?’000 ?’000 ?’000

Segment revenue 24,911 1,032 36 25,979

Operating profit before 5,573 599 53 6,225
adjustments

Revaluation of investments – (3,075) (534) (3,609)

Operating profit and 5,573 (2,476) (481) 2,616
segment result

Segment assets 15,199 11,408 752 27,359

Un allocated assets

– Fixed assets 99

– Cash & cash equivalents 3,414

Total assets 30,872

Segment liabilities (4,461) (3,230) (2) (7,693)

Borrowings (889) (3,000) – (3,889)

(5,350) (6,230) (2) (11,582)

Unallocated liabilities (6,726)

Total liabilities (18,308)

Net assets 12,564

Investment in joint 3,072
ventures non segmental

Net assets as per balance 15,636
sheet

Depreciation 2,027 – 45 2,072

Capital expenditure 3,788 – 153 3,941

Geographic analysis (secondary segment)

United South Other Unallocated Total

Kingdom Africa

?’000 ?’000 ?’000 ?’000 ?’000

Segment revenue 1,068 24,911 – – 25,979

Operating (loss)/profit (2,957) 5,573 – – 2,616
and segment result

Segment net assets 6,661 9,162 (46) (3,213) 12,564

Capital expenditure 153 3,788 – – 3,941

1. Segmental reporting continued

Business analysis (primary segment)

2007

Mining Property Other Total

?’000 ?’000 ?’000 ?’000

Segment revenue 15,594 1,019 80 16,693

Operating profit before 1,702 269 12 1,983
adjustments

Revaluation of investments – (2,588) 31 (2,557)

Exceptional item – 383 – 383

Operating profit and 1,702 (1,936) 43 (191)
segment result

Segment assets 7,662 15,772 954 24,388

Unallocated assets 150

– fixed assets

– cash and cash equivalents 3,199

Total assets 27,737

Segment liabilities (3,737) (3,201) (16) (6,954)

Borrowings (185) (3,402) – (3,587)

(3,922) (6,603) (16) (10,541)

Unallocated liabilities (4,357)

Total liabilities (14,898)

Net assets 12,839

Investment in joint 2,520
ventures
– non segmental

Net assets as per balance 15,359
sheet

Depreciation 1,171 – 25 1,196

Capital expenditure 1,643 – 132 1,775

Geographic analysis (secondary segment)

United South Other Unallocated Total

Kingdom Africa

?’000 ?’000 ?’000 ?’000 ?’000

Segment revenue 1,099 15,594 – – 16,693

Operating (loss)/profit (1,921) 1,702 – – (219)
and segment result

Segment net assets 9,050 4,773 24 (1,008) 12,839

Capital expenditure 132 1,643 – – 1,775

2. Operating costs

2008 2007

?’000 ?’000

Mining 12,457 9,997

Property 70 62

Share dealing 7 33

Cost of sales 12,534 10,092

Administration 7,220 4,618

Operating costs 19,754 14,710

The direct property costs are:

Ground rent 15 18

Direct property expense 50 49

Bad debts 5 (5)

70 62

3. Loss/(gain) on revaluation and sale of investment properties

The reconciliation of the investment surplus to the gain on revaluation of
investment properties in the income statement is set out below:

2008 2007

?’000 ?’000

Gains on revaluation of investment properties – – 383
realised

Loss on revaluation of investment properties – (3,075) (2,588)
unrealised

Valuation movement in respect of head lease payments 33 (121)

Investment surplus (3,042) (2,326)

4. Exceptional items

2008 2007

?’000 ?’000

Gain on sale of investment properties – 383

5. Profit before taxation

Profit before taxation is arrived at after charging:

2008 2007

?’000 ?’000

Staff costs (see note 29) 7,616 6,228

Depreciation 2,072 1,196

Exchange loss/(gain) 144 (49)

Fees payable to the company’s auditor for 43 21
the audit of the company’s annual accounts

Fees payable to the company’s auditor and
its associates for other services:

The audit of the company’s subsidiaries, 19 13
pursuant to legislation

Tax services – 1

Other services 1 4

The directors consider the auditors were best placed to provide the above
non-audit services.
The audit committee reviews the nature and extent of non-audit services to
ensure that independence is maintained.

6. Director’s emoluments

Director’s emoluments are shown in the Director’s remuneration report on page
26 under the heading Director’s remuneration which is within the audited part
of this report.

7. Interest payable

2008 2007

?’000 ?’000

On bank overdrafts and bank loans 176 160

Other interest payable 347 262

Hedging 16 36

Interest payable 539 458

8. Taxation

2008 2007

?’000 ?’000

(a) Based on the results for the year:

Corporation tax at 28.5% (2007: 30%) 2,075 326

Adjustment in respect of prior years – UK 142 4

Current tax 2,217 330

Deferred tax (406) (881)

Total tax in income statement 1,811 (551)

(b) Factors affecting tax charge for the
year:

The corporation tax assessed for the year is
different from that at the standard rate of
corporation tax in the United Kingdom of
28.5% (2007: 30%)

The differences are explained below:

Profit on ordinary activities before taxation 2,117 (459)

Tax on profit on ordinary activities at 28.5% 603 (138)
(2007: 30%)

Effects of:

Expenses not deductible for tax purposes 298 89

Capital allowances for the year in excess of – (209)
depreciation

Capital gains in excess of profit on disposal 283 (307)

Other differences 63 43

Deferred tax assets not recognised 328 13

Adjustment to smaller companies rates (31) (42)

Adjustment in respect of prior years 267 –

Total tax 1,811 (551)

(c) Analysis of United Kingdom and Overseas tax

United Kingdom tax included in above:

Corporation tax – (133)

Adjustment in respect of prior years 142 –

Current tax 142 (133)

Deferred tax (1,150) (1,023)

(1,008) (1,156)

Overseas tax included in above:

Corporation tax 2,075 459

Adjustment in respect of prior years – 4

Current tax 2,075 463

Deferred tax 744 142

2,819 605

Factors that may affect future tax charges:

Based on current capital expenditure plans, the group expects to continue to be
able to claim capital allowances in excess of depreciation in future years.

9. Dividends paid

2008 2008 2007 2007
Per share ?’000 Per share ?’000

Prior period final dividend 3.50 p 366 3.00p 313

A final dividend in respect of 2008 of 3.50p (2007: 3.00p) per share amounting
to a total of ?366,000 (2007: ?313,000) is proposed by the board. The dividend
proposed is not accounted for until it has been approved at the Annual General
Meeting. The amount will be accounted for as an appropriation of retained
earnings in the year ending 31 December 2009.

10. Earnings and diluted earnings per share

Both the basic and diluted earnings per share calculations are based on a
profit after tax of ?302,000 (2007: profit ?92,000). The basic earnings per
share have been calculated on 10,451,506 (2007: 10,451,506) ordinary shares
being in issue during the period. The diluted earnings per share have been
calculated on the number of shares in issue of 10,451,506 (2007: 10,451,506)
plus the dilutive potential ordinary shares arising from share options of
236,986 (2007: 433,438) totalling 10,688,492 (2007: 10,884,944).

11. Investment properties

Freehold Long
?’000 Leasehold Total
?’000 ?’000

Valuation at 1 January 11,075 3,650 14,725
2008

Additions 123 – 123

Revaluation (2,525) (550) (3,075)

Valuation at 31 December 8,673 3,100 11,773
2008

Valuation at 1 January 13,470 3,800 17,270
2007

Additions 43 – 43

Revaluation (2,438) (150) (2,588)

Valuation at 31 December 11,075 3,650 14,725
2007

Historical cost

At 31 December 2008 4,776 728 5,504

At 31 December 2007 4,653 728 5,381

Long leasehold properties are those for which the unexpired term at the balance
sheet date is not less than 50 years.

All investment properties are held for use in operating leases and all
properties generated rental income during the period.

Freehold and Long Leasehold properties were externally professionally valued at
31 December 2008 on an open market basis by:

?’000

Atisreal Ltd, Chartered 8,673
Surveyors

Carter Towler LLP, 3,100
Chartered Surveyors

11,773

The valuations were carried out in accordance with the Statements of Asset
Valuation and Guidance Notes published by

The Royal Institution of Chartered Surveyors.

12. Mining reserves, plant and equipment

Mining Mining Motor Office Total

Reserves Equipment Vehicles Equipment

?’000 ?’000 ?’000 ?’000 ?’000

Cost at 1 January 2008 1,703 7,577 579 80 9,939

Exchange adjustment 2 9 – – 11

Additions – 3,774 21 23 3,818

Disposals – – (254) – (254)

Cost at 31 December 2008 1,705 11,360 346 103 13,514

Accumulated depreciation 869 2,812 359 40 4,080
at 1 January 2008

Exchange adjustment 1 3 – – 4

Charge for the year 281 1708 69 14 2,072

Disposals in year – – (196) – (196)

Accumulated depreciation 1,151 4,523 232 54 5,960
at 31 December 2008

Net book value at 31 554 6,837 114 49 7,554
December 2008

Cost at 1 January 2007 1,976 6,906 562 59 9,503

Exchange adjustment 27 84 6 – 117

Additions 45 1,556 99 32 1,732

Disposals (345) (969) (88) (11) (1,413)

Cost at 31 December 2007 1,703 7,577 579 80 9,939
Accumulated depreciation 1,127 2,569 350 42 4,088
at 1 January 2007

Exchange adjustment 15 32 4 – 51

Charge for the year 192 946 49 9 1,196

Disposals in year (465) (735) (44) (11) (1,255)

Accumulated depreciation 869 2,812 359 40 4,080
at 31 December 2007

Net book value at 31 834 4,765 220 40 5,859
December 2007

13. Investments held as non-current assets

2008 2008 2007 2007

Joint Joint
Other Other
Ventures Ventures
Assets Assets

?’000 ?’000 ?’000 ?’000

At 1 January 1,921 684 2,126 604

Additions – – – 78

Transfer 747 (67) –

Exchange adjustment – – – 2

Share of loss in joint (305) – (205) –
ventures

Net assets at 31 December 2,363 617 1,921 684

At 1 January 599 – 511 –

Loan to joint venture 110 – 88 –

At 31 December 709 – 599 –

At 31 December 3,072 617 2,520 684

Provision for diminution in
value

At 1 January – (213) – (213)

Write down of investment – (70) – –

At 31 December – (283) – (213)

Net book value at 31 3,072 334 2,520 471
December

Included in other 2008 2008
investments are: ?’000 ?’000

Net book value of unquoted 133 258
investments

Rehabilitation fund 186 196

Market value of the 15 17
overseas listed investments

334 471

Net book value of 35 143
investments listed on
overseas Stock Exchanges

14. Joint ventures

The company owns 50% of the issued share capital of Dragon Retail Properties
Limited, an unlisted property investment company. The remaining 50% is held by
London & Associated Properties PLC.

Dragon Retail Properties Limited is incorporated in England and Wales. It has
issued share capital of 500,000 (2007: 500,000) ordinary shares of ?1 each. The
company owns 49% of the issued share capital of Ezimbokodweni Mining (pty)
Limited, an unlisted prospective coal production company. The company is
incorporated in South Africa. It has issued share capital of 100 (2007: 100)
ordinary shares of ZAR1each.

Ezimbokodweni Dragon

49% 50% 2008 2007

?’000 ?’000 ?’000 ?’000

Turnover 101 101 92

Profit and loss

Loss before tax – (304) (304) (210)

Taxation – (1) (1) 6

Loss after taxation – (305) (305) (204)

Balance sheet

Non-current assets 708 1,387 2,095 2,261

Current assets – 1,624 1,624 1,649

Current liabilities (708) (1,230) (1,938) (723)

Non-current liabilities (101) (101) (1,265)

Share of net assets at 31 – 1,680 1,680 1,922
December

15. Subsidiary companies

The company owns the following ordinary share capital of the principal
subsidiaries which are included within the consolidated financial statements:

Activity Percentage of Country of
share capital incorporation

Mineral Products Limited Share dealing 100% England and Wales

Black Wattle Colliery Coal mining 100% South Africa
(pty) Limited

Bisichi Coal Mining (pty) Coal mining 100% South Africa
Limited

Bisichi Mining Holding company 100% England and Wales
(Exploration) Limited

Ninghi Marketing Limited Dormant 90.1% England and Wales

16. Inventories

2008 2007

?’000 ?’000

Coal

Washed 1,284 63

Unwashed – 18

Run of mine 83 38

Other 30 7

1,397 126

17. Trade and other receivables

2008 2007

?’000 ?’000

Amounts falling due within
one year:

Trade receivables 5,392 1,484

Other receivables 76 591

Prepayments and accrued 56 55
income

5,524 2,130

18. Held for trading investments

2008 2007

?’000 ?’000

Market value of Listed
Investments:

Listed in Great Britain 582 694

Listed outside Great Brittain 45 76

627 770

Original cost of Listed 814 487
Investments

Unrealised (deficit) surplus (187) 283
of market value (under) over
cost

19. Trade and other payables

2008 2007

?’000 ?’000

Trade payables 852 656

Joint venture 1,551 1,478

Provisions – 472

Other payables 538 762

Accruals and deferred 2,874 2,238
income

5,815 5,606

The provision in 2007 relates to the South African litigation which was settled
in 2008.

20. Financial liabilities – borrowings

2008 2007 2008 2007

?’000 ?’000 ?’000 ?’000

Bank overdraft 3,530 1,955 – –
(secured)

Bank loan (secured) 3,347 447 541 3,139

6,877 2,402 541 3,139

2008 2007

?’000 ?’000

Within one year 6,877 2,402

From one to two years 334 403

From two to five years 207 2,736

7,418 5,541

Bank overdraft and
loan analysis
by origin:

United Kingdom 6,042 5,159

Southern Africa 1,376 382

7,418 5,541

The United Kingdom bank loans and overdraft are secured by way of a first
charge over the investment properties in the UK which are included in the
financial statements at a value of ?11,773,000. The South African bank loans
are secured by way of a first charge over specific pieces of mining equipment
or the debtors of the relevant company which holds the loan.

Consistently with others in the industry, the group monitors its capital by its
gearing levels. This is calculated as the net debt

(loans less cash and cash equivalents) as a percentage of the equity. During
2008 this increased to 25.6 % (2007: 15.2%) which was calculated as follows:

2008 2007

?’000 ?’000

7,418 5,541

Total debt (3,414) (3,199)

Less cash and cash 4,004 2,342
equivalents

Net debt 15,636 15,359

Total equity 25.6% 15.2%

Gearing

21. Provision for rehabilitation

2008 2007

?’000 ?’000

As at 1 January – –

Transfer 99 –

Additions 472 –

As at 31 December 571 –

22. Financial instruments

Treasury policy

The group enters into derivative transactions such as interest rate swaps and
forward exchange contracts in order to help manage the financial risks arising
from the group’s activities. The main risks arising from the group’s financing
structure are interest rate risk, liquidity risk, market risk, credit risk,
currency risk & commodity price risk. The policies for managing each of these
risks and the principal effects of these policies on the results are summarised
below.

Interest rate risk

Interest rate risk is the risk that the value of a financial instrument or
cashflows associated with the instrument will fluctuate due to changes in
market interest rates. Interest rate risk arises from interest bearing
financial assets and liabilities that the Group uses. Treasury activities take
place under procedures and policies approved and monitored by the Board to
minimise the financial risk faced by the Group. Interest bearing assets
comprise cash and cash equivalents which are considered to be short-term liquid
assets and loans to joint ventures. Interest bearing borrowings comprise bank
loans, bank overdrafts and variable rate finance lease obligations. The rates
of interest vary based on LIBOR in the UK and PRIME in South Africa.

As at 31 December 2008, with other variables unchanged, a 1% increase or
decrease in interest rates, on investments and borrowings whose interest rates
are not fixed, would respectively decrease or increase the profit for the year
by ?51,000. The effect on equity of this change would be an equivalent decrease
or increase for the year of ?51,000.

Liquidity risk

The group’s policy is to minimise refinancing risk. Efficient treasury
management and strict credit control minimise the costs and risks associated
with this policy which ensures that funds are available to meet commitments as
they fall due. Trade and other payables are all due within one year.

The table below shows the currency profiles of cash and cash equivalents:

2008 2007

?’000 ?’000

Sterling 203 214

South African Rand 3,211 2,985

3,414 3,199

Cash and cash equivalents earn interest at rates based on LIBOR in Sterling and
Prime in Rand.

Market risk

The group is exposed to market price risk through interest rate and currency
fluctuations and commodity price risk.

Credit risk

The group is exposed to credit risk on its cash and cash equivalents as per the
balance sheet. At the balance sheet date there was no significant concentration
of credit risk. The maximum exposure to credit risk is represented by the
carrying amount of each financial asset in the balance sheet. Trade debtor’s
credit ratings are reviewed regularly. The group only deposits surplus cash
with well-established financial institutions of high quality credit standing.
As at year end there were no material receivables held past due date.

Financial assets maturity

On 31 December 2008, cash at bank and in hand amounted to ?3,414,000 (2007: ?
3,199,000) which is invested in short term bank deposits maturing within one
year bearing interest at the bank’s variable rates. Cash and cash equivalents
all have a maturity of less than 3 months.

Total financial assets and liabilities

The Group’s financial assets and liabilities are as follows, representing both
the fair value and the carrying value:

2008 2007

?’000 ?’000

Financial assets: 627 770
investments held for trading

Other assets 5,468 2,075

Bank Borrowings (7,418) (5,541)

Finance leases (234) (267)

Other Liabilities (5,815) (5,606)

(3,958) (5,370)

Borrowing facilities

At 31 December 2008 the Group was within its bank borrowing facilities and had
not breached any covenants. Overdrafts are renewable annually. Term loan
repayments are as set out in note 20. The group has undrawn facilities of ?
3,205,000 (2007: ?4,045,000) which expire within one year. Details of other
financial liabilities are shown in notes 19 and 20.

Hedge profile

No interest rate swap was entered into during the year. The interest rate swap
previously held at a fixed rate of 4.05% expired in January 2008 and had a fair
value at 31st December 2007 of ?16,000.

Commodity price risk

Commodity price risk is the risk that the Group’s future earnings will be
adversely impacted by changes in the market of commodities. The group is
exposed to commodity price risk as its future revenues will be derived based on
a contract with a physical off-take partner at prices that will be determined
by reference to market prices of coal at the delivery date.

From time to time the Group may manage its exposure to commodity price risk by
entering into forward sales contracts with the goal of preserving future
revenue streams.

Foreign exchange risk

All trading is undertaken in the local currencies. Funding is also in local
currencies other than inter-company investments
and loans and it is not the Group’s policy to obtain forward contracts to
mitigate foreign exchange risk on these amounts.

As a result of the group mining assets being held in South Africa and having a
functional currency different than the presentation currency, the Group balance
sheet can be affected significantly by movements in the pounds sterling to the
South African Rand. During 2007 and 2008 the group did not hedge its exposure
of foreign investments held in foreign currencies. There is no significant
impact on profit and loss from foreign currency movements associated with these
South African subsidiary assets and liabilities as the effective portion of
foreign currency gains or losses arising are recorded through the translation
reserve.

The effect of a movement in foreign currencies on the income statement and
equity of the group is shown in the sensitivity analysis below:

Profit and Profit and Equity Equity
loss loss

2008 2007 2008 2007

?’000 ?’000 ?’000 ?’000

If there were a 10%
weakening
of the South African Rand
against

Sterling with all other (391) (117) (776) (327)
variables
held constant – (decrease)

If there were a 10%
strengthening
of the South African Rand
against

Sterling with all other 433 130 949 401
variables
held constant – increase

23. Deferred taxation

2008 2007

?’000 ?’000

Balance at 1 January 3,030 3,899

Recognised in income (406) (881)

Exchange adjustment 1 12

2,625 3,030

The deferred tax balance
comprises
the following:

Revaluation of properties 1,313 1,896

Capital allowances 1,827 1,120

Short-term timing (515) 14
differences

2,625 3,030

24. Share capital

2008 2007

?’000 ?’000

Authorised: 13,000,000 1,300 1,300
ordinary
shares of 10p each

Allotted and fully paid: 1,045 1,045
10,451,506 ordinary shares

The groups objectives when managing capital are:

* To safeguard the group’s ability to continue as a going concern, so that it
can provide returns for shareholders
and benefits for other stakeholders; and

* To provide adequate return to shareholders by ensuring returns are
commensurate with the risk.

The group sets the amount of capital in proportion to risk. It ensures that the
capital structure is commensurate to the economic conditions and risk
characteristics to the underlying assets. In order to maintain or adjust the
capital structure, the group may adjust the capital structure, vary the amount
of dividends paid to shareholders, return capital to shareholders, issue new
shares or sell assets to reduce debt.

25. Other reserves

2008 2007

?’000 ?’000

Equity share options 577 340

Net premium on share 86 86
capital
in joint venture

663 426

26. Share based payments

Details of the share option scheme are shown in the Directors remuneration
report on page 26 under the heading Share option schemes which is within the
audited part of this report. Further details of the share option schemes are
set out below.

The Bisichi Mining PLC Unapproved Option Schemes:

Year of Subscription Period within Number of Number of Number of
grant price per which options share share share
share exercisable for which options for which
options issued options
outstanding during outstanding
at year at
31 December 31 December
2007 2008

2002 34.0p Sep 2005 – Sep 313,000 – 313,000
2012

2004 149.0p Sep 2007 – Sep 200,000 – 200,000
2014

2006 237.5p Oct 2009 – Oct 600,000 – 600,000
2016

The exercise of options under the Unapproved Share Option Schemes is subject to
the satisfaction of objective performance conditions specified by the
remuneration committee, which will conform to institutional shareholder
guidelines and best practice provisions in force from time to time. The
remuneration committee has not yet set these guidelines for the first scheme
and the 2006 scheme. The performance conditions for the second scheme, agreed
by members on 23 June 2005, requires growth in net assets over a three year
period to exceed the growth of the retail prices index by a scale of
percentages.

Options were valued using the Binomial method with the following assumptions:

Expected volatility 45.46 – 47.33%

Expected life 3.00 – 5.00 Years

Risk free rate 4.81 – 4.93%

Expected dividends 0.08%

Expected volatility was determined by reference to the historical volatility of
the share price over a period commensurate with the option’s expected life. The
expected life used in the model is based on the risk-averse balance likely to
be required by the option holders.

2008 2007 2007
Number 2008 Number Weighted
Weighted average
average Exercise
Exercise price price

Outstanding at 1 January 1,113,000 164.4p 1,113,000 164.4p

Granted during year – – – –

Outstanding at 31 1,113,000 164.4p 1,113,000 164.4p
December

Exercisable at 31 513,000 78.8p 513,000 78.8p
December

27. Minority interest

2008 2007

?’000 ?’000

As at 1 January – –

Acquisition of subsidiary (14) –

Share of profit for the 4 –
year

As at 31 December (10) –

The acquisition of subsidiary relates to an increase in shareholding in Ninghi
Marketing Limited, an unlisted coal trading company. The company is
incorporated in England & Wales. It has issued share capital of 101 (2007:?101)
ordinary shares of ?1 each. The shareholding in the company is 90.1% (2007:45%)

28. Related Party Transactions

At 31 December 2008 During the year

Amounts Amounts Costs Cash paid
owed owed recharged (to)
to related by related (to) / by / by
party party related related
party party

?000 ?000 ?000 ?000

Related party:

London & Associated Properties 147 – 287 (568)
PLC (note (a))

Dragon Retail Properties 1,510 – – (73)
Limited (note (b))

Ezimbokodweni Mining (pty) – (708) (109) –
Limited (note (c))

As at 31 December 2008 1,657 (708) 178 (641)

As at 31 December 2007 1,865 (599) 67 (747)

London & Associated Properties PLC is a substantial shareholder.

Dragon Retail Properties Limited is a joint venture and is treated as a
non-current asset investment.

Ezimbokodweni Mining (pty) Limited is a joint venture and is treated as a
non-current asset investment.

(a) London & Associated Properties PLC
Property management, office premises, general management, accounting and
administration services are provided for Bisichi Mining PLC and its UK
subsidiaries.

(b) Dragon Retail Properties Limited

Dragon Retail Properties Limited is owned equally by the company and London &
Associated Properties PLC.

(c) Ezimbokodweni Mining (pty) Limited

Ezimbokodweni Mining is a prospective coal production company based in South
Africa.

Details of key management personnel compensation and interest in share options
are shown in the Directors Remuneration Report on page 26 under the headings
Directors remuneration, Pension schemes and incentives and Share option schemes
which is within the audited part of this report.

29. Employees

2008 2007

Number Number

The average weekly number of employees of the
group during the year were as follows:

Production 453 480

Administration 18 16

471 496

?’000 ?’000

Staff costs during the year
were as follows:

Salaries 6,901 5,654

Social security costs 244 154

Pension costs 234 183

Share based payments 237 237

7,616 6,228

30. Capital commitments

2008 2007

?’000 ?’000

Commitments for capital expenditure approved but 158 220
not contracted for at the year end

Commitments for capital expenditure approved and 390 –
contracted for
at the year end

Share of commitment of capital expenditure in 1,856 1,854
joint venture

31. Head lease commitments and future property lease rentals

Present value of head leases on properties

Minimum lease payments Present value of minimum
lease payments

2008 2007 2008 2007

?’000 ?’000 ?’000 ?’000

Within one year 15 15 15 15

Second to fifth year 61 59 56 55

After five years 2,054 2,002 163 197

2,130 2,076 234 267

Discounting (1896) (1,809) – –
adjustment

Present value 234 267 234 267

Finance lease liabilities are in respect of leased investment property. Many of
the lease’s provide for contingent rents in addition to the rents above which
is a proportion of rental income. Finance lease liabilities are effectively
secured as the rights to the leased asset revert to the lessor in event of
default.

The group leases out its investment properties under operating leases. The
future aggregate minimum rentals receivable under non-cancellable operating
lease are as follows:

2008 2007

?’000 ?’000

Within one year 658 804

Second to fifth year 2,219 2,541

After five years 9,977 10,424

12,854 13,769

32. Contingent liabilities

Bank guarantee 213 –

A bank guarantee for an amount of ?213,000 has been provided by Black Wattle
Colliery (pty) Limited to a third party in respect of the construction of dams.

COMPANY BALANCE SHEET
at 31 December 2008

2008 2007

Notes ?’000 ?’000

Fixed assets

Tangible assets 34 11,872 14,838

Investment in joint ventures 35 847 164

Other investments 35 1,026 1,130

13,745 16,132

Current assets

Debtors 36 5,978 1,560

Interest derivative – 16

Bank balances 2,373 2,626

8,351 4,202

Creditors – amounts falling due within one 37 (9,276) (4,635)
year

Net current liabilities (925) (433)

Total assets less current liabilities 12,820 15,699

Creditors – amounts falling due after one 37 – (3,000)
year –
medium term bank loan

Provisions for liabilities and charges 38 – (39)

Net assets 12,820 12,660

Capital and reserves

Called up share capital 24 1,045 1,045

Revaluation reserve 39 5,871 8,946

Other reserves 39 578 357

Retained earnings 39 5,326 2,312

Shareholders’ funds 12,820 12,660

The company financial statements were approved and authorised for issue by the
board of directors on 17 April 2009

and signed on its behalf by:

M A Heller A R Heller

Director Director

COMPANY ACCOUNTING POLICIES
for the year ended 31 December 2008

The following are the main accounting policies of the company:

Accounting convention

The financial statements have been prepared under the historical cost
convention, as modified by the revaluation of investment properties, and in
accordance with applicable UK accounting standards.

Dividends received

Dividends are credited to the profit and loss account when received.

Depreciation

Provision for depreciation on tangible fixed assets is made in equal annual
instalments to write each item off over its useful life. The rates generally
used are:

Motor vehicles 25 – 33 per cent

Office equipment 10 – 33 per cent

Foreign currencies

Monetary assets and liabilities expressed in foreign currencies have been
translated at the rates of exchange ruling at the balance sheet date. All
exchange differences are taken to the profit and loss account.

Investment properties

The investment property portfolio is included in the financial statements at
open market valuation. An external professional valuation is carried out
annually by professional external surveyors. Surpluses and deficits arising on
valuations are taken direct to the revaluation reserve. No depreciation or
amortisation is provided in respect of freehold and leasehold investment
properties. The directors consider that this accounting policy, which is not in
accordance with the Companies Act 1985, results in the accounts giving a true
and fair view. Depreciation or amortisation is only one of many factors
reflected in the valuation and the amount which might otherwise have been shown
cannot be separately identified or quantified.

Investments

Listed investments of the company are stated in the balance sheet as fixed
assets at cost less provisions for impairment.

Financial Instruments

Bank loans and overdrafts

Bank loans and overdrafts are included in creditors on the company balance
sheet at the amounts drawn on the

particular facilities. Interest payable on those facilities is expensed as a
finance cost in the period to which it relates.

Interest rate derivatives

The company uses derivative financial instruments to manage the interest rate
risk associated with

the financing of the group’s business. No trading in such financial instruments
is undertaken.

Debtors

Debtors do not carry any interest and are stated at their nominal value as
reduced by appropriate allowances for estimated recoverable amounts.

Creditors

Creditors are not interest bearing and are stated at their nominal value.

Joint Ventures

Investments in joint ventures, being those entities over whose activities the
group has joint control as established

by contractual agreement, are included at cost.

Deferred taxation

As required by FRS 19 ‘Deferred Tax’, full provision is made for deferred tax
arising from all timing differences between the recognition of gains and losses
in the financial statements and recognition in the tax computation, except for
those timing differences in respect of which the standard specifies that
deferred tax should not be recognised. Deferred tax assets and liabilities are
calculated at the tax rates expected to be effective at the time the timing
differences are expected to reverse.

Leased Assets and Obligations

All leases are ‘Operating Leases’ and the annual rentals are charged to the
profit & loss account on a straight line basis over the lease term. Rent free
periods or other incentives received for entering into a lease are accounted
for over the period of the lease so as to spread the benefit received over the
lease term.

Pensions

The company makes contributions to a money purchase scheme and the costs are
charged to the profit and loss account

in the period to which they relate.

.

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2008

33. Dividends

The aggregate amount of dividends comprises:

2008 2007

?’000 ?’000

Final dividends in respect of prior year but not 313 261
recognised as liabilities in that year:

The aggregate amount of dividends proposed and not recognised as liabilities as
at year end is ?366,000(2007: ?313,000).

34. Tangible fixed assets

Investment
properties

Long Motor Office Total
Freehold leasehold vehicles Equipment ?’000
?’000 ?’000 ?’000 ?’000

Cost or valuation at 1 11,075 3,650 148 37 14,910
January 2008

Additions 123 – 21 10 154

Disposals – – – – –

Revaluation (2,525) (550) – – (3,075)

Cost or valuation at 31 8,673 3,100 169 47 11,989
December 2008

At valuation 8,673 3,100 – – 11,773

At cost – – 169 47 216

8,673 3,100 169 47 11,989

Accumulated depreciation – – 44 28 72
at 1 January 2008

Charge for the year – – 40 5 45

Disposals in year – – – – –

Accumulated depreciation – – 84 33 117
at 31 December 2008

Net book value at 31 8,673 3,100 85 14 11,872
December 2008

Net book value at 31 11,075 3,650 104 9 14,838
December 2007

Details of historical cost of investment properties are shown in note 11.

35. Investments

Joint Subsidiaries Other
Ventures Investments

Shares Shares Loans ?’000 Total
?’000 ?’000 ?’000 ?’000

Cost at 1 January 2008 164 1,024 641 356 2,021

Drawn in year 683 – 22 – 22

Transfer – – – (56) (56)

Cost at 31 December 2008 847 1,024 663 300 1,987

Provision for impairment

As at 1 January – (678) – (213) (891)

Impaired during the year – – (70) (70)

As at 31 December 2008 – (678) – (283) (961)

Net book value at 31 847 346 663 17 1,026
December 2008

Net book value at 31 164 346 641 143 1,130
December 2007

Other investments comprise ?17,000 (2007: ?87,000) shares and ?nil (2007: ?
56,000) loans.

Investments in subsidiaries are detailed in note 18. In the opinion of the
directors the aggregate value of the investment in subsidiaries is not less
than the amount shown in these financial statements.

36. Debtors

2008 2007

?’000 ?’000

Amounts falling due within one year:

Amounts due from subsidiary undertakings 5,869 796

Tax recoverable – 144

Other debtors 73 589

Prepayments and accrued income 36 31

5,978 1,560

37. Creditors

2008 2007

?’000 ?’000

Amounts falling due within one
year:

Bank overdraft (secured) 3,042 1,757

Bank loan (secured) 3,000 402

Joint venture 1,551 1,478

Other taxation and social security 69 387

Other creditors 271 278

Accruals and deferred income 1,343 333

9,276 4,635

The bank overdraft of the Company is secured by a charge over freehold and long
leasehold property.

Amounts falling due within one year:

Bank loans – 3,000

Bank and other loan instalments by reference to the balance sheet date:

Within one year 3,000 402

From one to two years – 400

From two to five years – 2,600

3,000 3,402

The bank loan of the company is secured by a charge over freehold and long
leasehold properties.

38. Provisions for liabilities and charges

?’000

Deferred Taxation

Balance at 1 January 2008 39

Transfer to profit and loss account (39)

Balance at 31 December 2008 –

No provision has been made for the approximate taxation liability at 28%(2007:
28%) of ?1,313,000 (2007: ?1,896,000) which would arise if the investment
properties were sold at the stated valuation.

2008 2007

?’000 ?’000

The deferred tax balance comprises
the following:

Accelerated capital allowances – 39

39. Reserves

Revaluation Other Retained
reserve reserve earnings
?’000 ?’000 ?’000

Balance at 1 January 8,946 357 2,312
2008

Dividend paid – – (313)

Revaluation of (3,075) – –
investment property

Movement in reserves – (16) 16

Share options – 237 –

Retained profit for the – – 3,311
year

Balance at 31 December 5,871 578 5,326
2008

A profit and loss account for Bisichi Mining PLC has not been presented as
permitted by Section 230(4) of the Companies Act 1985. The profit for the
financial year, before dividends, was ?3,311,000 (2007: loss ?289,000).

Details of share capital are set out in note 24 and details of the share
options are shown in the Director’s Remuneration Report and note 26.

40. Related party transactions

Under Financial Reporting Standard 8 Related Party Disclosures, the Company has
taken advantage of the exemption from

disclosing transactions with other Group companies.

Details of other related party transactions are given in note 28 of the Group
financial statements.

41. Employees

The average number of employees (excluding directors), in administration,
during the year was 2 (2007: 1).

2008 2007

?’000 ?’000

Staff costs were as follows:

Salaries 219 42

Social Security costs 28 5

247 47

END