Final Results

60 St James's Street, London SW1A 1LE, United Kingdom

Telephone: + 44 (0)20 7629 7772 Facsimile: + 44 (0)20 7629 7773

E mail: [email protected]

13th May 2014

PRELIMINARY RESULTS

OPERATING PROFIT OF $20.3 MILLION

RECORD GOLD PRODUCTION

Griffin Mining Limited ("Griffin" or the "Company") has today published its preliminary results for the year ended 31st December 2013. Griffin and its subsidiaries (together the "Group") recorded:

· Operating profit of $20,293,000 in 2013 (2012 $31,174,000);

· Profit before tax of $14,827,000 in 2013 (2012 $27,239,000);

· Profit after tax of $9,756,000 in 2013 (2012 $19,707,000); and

· Profit after non-controlling interests of $8,157,000 in 2013 (2012 $14,835,000)

Overview

Record amounts of ore were mined, hauled and processed in 2013. With the upper mine levels being mined to maximise the extractable amount of ore, grades were lower resulting in lower zinc, lead and silver production in 2013. Gold grades and recoveries have improved such that record gold production was achieved in 2013.

Revenues were further impacted by lower prices for all metals. As a result revenues in 2013 fell to $71,071,000 (2012 $76,860,000).

Whilst processing costs and administration costs have been contained, mining and haulage costs have risen with increased production and further mine development. With lower revenues and increased costs, profits from operations fell to $20,293,000 in 2013 (2012 $31,174,000).

In summary, production in 2013 was as follows:

· A record 877,803 tonnes of ore were mined, compared to 789,692 tonnes in 2012, a 11.3% increase;

· A record 838,431 tonnes of ore were processed, compared to 800,288 tonnes in 2012, a 4.8% increase;

· A record 11,468 ounces of gold in concentrate were produced, compared to 8,322 ounces in 2012, a 37.8% increase;

· 39,724 tonnes of zinc metal in concentrate were produced, compared to 40,581 tonnes in 2012;

· 323,808 ounces of silver in concentrate were produced, compared to 409,596 ounces in 2012; and

· 1,553 tonnes of lead in concentrate were produced, compared to 2,402 tonnes in 2012.

In 2013, the average market price for zinc fell 2% from that in 2012. With increased treatment charges, the average price per tonne of zinc metal in concentrate received by the Group in 2013 fell by 5.2% to $1,302 (2012: $1,374). The average price received for silver declined 26.3% to $16.8 per ounce (2012: $22.8), for lead by 12.0% to $1,633 per tonne (2012: $1,855), and for gold by 17.7% to $1,233 per ounce (2012: $1,499)

Cost of sales have increased 15.2% in 2013 to $40,078,000 (2012: $34,795,000). A significant amount of this cost increase may be attributed to increased amounts of ore being mined, hauled and processed. Further cost increases resulted from mine development with lower mine levels being accessed and increased contractor rates for mining and haulage.

Group operating costs in 2013 of $10,700,000 were in line with that in 2012 of $10,891,000, despite inflationary cost increases in China.

Profits before tax declined to $14,827,000 (2012: $27,239,000) reflecting not only lower operating profits but also increased charges of $3,651,000 (2012: $3,414,000) arising from the new dry tailings facility at Caijiaying and the loss of $2,229,000 on the disposal of Griffin's interest in Spitfire Oil Limited at the end of 2013. The Group benefited from interest receipts of $145,000 (2012: $495,000), foreign exchange gains of $107,000 (2012: losses of $904,000) and other income of $162,000 (2012: $48,000).

Income taxes of $5,071,000 (2012: $7,532,000) were charged. This includes a deferred taxation provision of $297,000 (2012: nil).

The non controlling interests share of Hebei Hua Ao's profits of $1,599,000 (2012: $4,872,000) were provided, resulting in attributable profits to Griffin of $8,157,000 (2012: $14,835,00). The reduction in non controlling interests reflects not only a reduction in profits but also a reduction in the non controlling party's equity interest from 40% to 11.2% with effect from the 25th June 2012.

Basic earnings per share in 2013 was 4.63 cents (2012: 8.46 cents) with diluted earnings per share of 4.63 cents in (2012: 8.36 cents).

During 2013, 260,000 (2012: 50,000) ordinary shares were bought back in the market for cancellation at a cost of $119,000 (2012: $24,000). 3,900,000 ordinary shares were issued on the exercise of options by directors and management in 2013 bringing the number of Griffin shares on issue to 179,091,830.

Net cash inflow from operating activities in 2013 amounted to $27,997,000 (2012: $32,244,000). $20,227,000 was invested in 2013, (2012: $125,419,000 including $117,459,000 to purchase the Chinese non controlling interests and extend the Hebei Hua Ao joint venture term).

Attributable net assets per share at 31st December 2013 was 84 cents ( 2012: 79 cents).

The directors have recommended that no dividend be declared at this time in view of the need for the use of the Company's financial resources for further investment in the Caijiaying Mine, repayment of bank loans and settlement of amounts due to non controlling interests.

Chairman's Statement:

A company is judged by continually improving financial results and although the Company's operations performed extraordinarily well, the new JORC resource was world class, the upgrade and mining licence approvals continued to progress and certain operating records were broken, the continuing slump in the price of the commodities mined produced a diminished financial result, albeit the Company produced its ninth year of continued profitability.

Griffin and its subsidiaries (together the "Group") recorded an operating profit of $20,293,000 in 2013, profit before tax of $14,827,000, profit after tax of $9,756,000 and profit after non-controlling interests of $8,157,000. Impressively, record amounts of ore were mined, hauled and processed in 2013 and a record 11,468 ounces of gold in concentrate were produced, a 37.8% increase on the previous year and a record for the Caijiaying Mine.

Profitability was affected by, a 15.2% increase in the cost of sales, particularly due to increased treatment charges, and decreased metal prices. In 2013, the average price per tonne of zinc metal in concentrate received by the Group fell by 5.2%, for silver by 26.3%, for lead by 12.0% and for gold by 17.7%.

One of the most significant events during 2013 was the release of the latest JORC resource estimate for the Caijiaying Mine. It confirmed a total resource of 49.4 million tonnes of ore containing 2 million tonnes of zinc, 212,000 tonnes of lead, 37.9 million ounces of silver and 825,000 ounces of gold. The extensive and defined ore resources at the Caijiaying Mine, together with the extension of the term of the Hebei Hua Ao joint venture to 2037, provided the confidence and time to expand the current mining and processing capabilities to catch the expected upturn in the zinc price cycle and provide the maximum return to shareholders.

With this in mind, the Caijiaying Mine is now in the active construction stage of increasing the mining and processing of ore to 1.5 million tonnes per annum. Significant progress continues to be made in the application for a new mining licence at Zone II and the area between Zone II and Zone III. Although delayed due to the change in Chinese central government leadership and administrative changes ensuing from that change, the mining licence is expected to be granted by the Autumn of 2014.

In the interim, the detailed upgrade plans have been completed and the lead contractor appointed. Tenders for the large capital machinery, with long lead times to delivery, have been granted. Ground work for the upgrade has commenced with the foundation earthworks ceremony having taken place, with all appropriate Chinese government officials present, on the 8th of April 2014. All above ground, new, expanded facilities, including ball mills, floatation tanks and a new power sub-station, should be installed during the summer months ready for completion by the 31st October 2014 to enable winter work to continue indoors and underground. Development work has commenced to access the Zone II area underground from both the rehabilitation of the Fox decline and from the main Zone III decline. The total upgrade is expected to be completed by the end of 2014. It is hoped that throughput will slowly be expanded towards the equivalent of 1.5 million tonnes of ore per annum in 2015.

Of course, Griffin, through Hebei Hua Ao, continues to be a responsible and vital member of the Caijiaying community. In addition to all the previous and ongoing community programmes, in 2013 a new initiative was begun to create a long term industry which would provide a more sustainable annual income for villagers less reliant on the seasonality of crops grown in the short summer months. Consequently, Hebei Hua Ao purchased for the Caijiaying village area, 170 cows, which were already pregnant with 47 offspring, establishing a sizeable initial herd of 217 cattle for the creation of a dairy and cattle farm. To date, the venture has been an outstanding success and it is planned to purchase another 183 cows by June next year to complete the programme and finalise a new industry for the local population.

It should not be thought, however, that the Company's only focus is the expansion of the Caijiaying Mine. Exploration continues unabated both underground and on the land holdings north, south, east and west of the current operations. Furthermore, the Company remains totally committed to searching, investigating, analysing and negotiating the acquisition of low cost, base or precious metals mining projects that have the potential to be brought into long term, economic production for a capital cost that provides a substantial and justifiable return on equity to shareholders. Such projects are rare and getting rarer. Nevertheless, a considerable number of projects and ventures have been reviewed and investigated during the past year. None as yet have been successfully consummated, mainly due to the discovery of negative findings during due diligence or an insufficient return calculated for the risk shareholders would need to accept in funding the project to production.

In terms of the Company's current operations and possible future acquisitions, the strategy being pursued is supported by the projected outlook for the world zinc price. 2014/2015 is expected to see world demand for zinc exceed supply by 400,000 tonnes, continuing for the foreseeable future. Demand is expected to expand 4.5% - 5.5% to 13.6 million tons this year whilst supply is being substantially affected by a limited number of small new mines in the planning stage and a series of very large mine closures including Glencore Xstrata's Perseverance and Brunswick mines, Vedanta's Lisheen operation and MMG's Century Zinc mine. This can only be positive for the world zinc price.

In terms of the perennial question of dividends, the Company continues to follow the advice of the Chairman and CEO of one of its largest shareholders, Larry Fink of Blackrock who, in an open letter to UK listed companies, urged firms to resist influence by shareholder short term pressures and not make short term dividends a priority over long term strategic goals but to invest in capital expenditure to boost long term growth. Needless to say, when the growth phase of the Company comes to an end, then dividends are an absolute legitimate use of excess shareholders funds.

The Company is delighted to welcome a totally new management team on site headed by our new Operations manager, Mr Maoheng Zhang, supported by CSA Global in Perth. To date, his new on-site team have met all of our expectations and everyone is excited by what lies ahead. They have our total support. Our thanks also go to all at Caijiaying staff and contractors, for their untiring efforts to make Caijiaying the world class mine it seemed destined to become.

Griffin Mining Limited

Mladen Ninkov - Chairman Telephone: +44(0)20 7629 7772

Roger Goodwin - Finance Director

Panmure Gordon (UK) Limited Telephone: +44 (0) 20 7886 2500

Dominic Morley

Griffin Mining Limited's shares are quoted on the Alternative Investment Market (AIM) of the London Stock Exchange (symbol GFM).

The Company's news releases are available on the Company's web site: www.griffinmining.com

Griffin Mining Limited

Summarised Consolidated Income Statement

For the year ended 31 December 2013

(expressed in thousands US dollars)

Griffin Mining Limited

Summarised Consolidated Statement of Comprehensive Income

For the year ended 31 December 2013

(expressed in thousands US dollars)

Griffin Mining Limited

Summarised Consolidated Statement of Financial Position

As at 31 December 2013

(expressed in thousands US dollars)

Griffin Mining Limited

Summarised Consolidated Statement of Changes in Equity.

For the year ended 31 December 2013

(expressed in thousands US dollars)

Griffin Mining Limited

Summarised Cash Flow Statement

For the year ended 31 December 2013

(expressed in thousands US dollars)

Notes:

1. This statement has been prepared using accounting policies and presentation consistent with those applied in the preparation of the statutory accounts of the Company.

2. The summary accounts set out above do not constitute statutory accounts as defined by Section 84 of the Bermuda Companies Act 1981 or Section 435 of the UK Companies Act 2006. The summarised consolidated statement of financial position at 31st December 2013 and the summarised consolidated income statement, summarised statement of comprehensive income, consolidated statement of changes in equity and the summarised consolidated cash flow statement for the year then ended have been extracted from the Group's 2013 statutory financial statements upon which the auditors' opinion is unqualified. The results for the year ended 31st December 2012 have been extracted from the statutory accounts for that period, which contain an unqualified auditors' report.

3. The annual report and accounts for 2013 are being sent by post to all registered shareholders. Additional copies of the annual report and accounts are available from the Company's London office, 6th Floor, 60 St James's Street, London, SW1A 1LE.

4. The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the year. The calculation of diluted earnings per share is based on the basic earnings per share on the assumed conversion of all dilutive options and other dilutive potential ordinary shares.

Reconciliation of the earnings and weighted average number of shares used in the calculations are set out below:

5. A prior period adjustment of $1,316,000 has been charged to profit and loss reserve in respect of financial periods to 31st December 2010. A third Statement of financial Position has not been presented as this does not impact the profits or losses for the years ended 31st December 2011 or 2012 and the impact of this is reflected in the Statement of Changes in Equity. The consolidated Statement of Financial Position at 31st December 2012 has been restated to reflect this. This charge relates to deferred taxation at 25% on accelerated depreciation for Chinese tax purposes during which time Hebei Hua Ao enjoyed advantageous tax rates in the PRC tax.