FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2012

For immediate release: 13 August 2012

AVARAE GLOBAL COINS PLC

FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2012

Avarae Global Coins plc ("Avarae" or the "Company"), the UK's only publicly traded specialist company dedicated to purchasing, holding and selling rare and high quality coins, is pleased to announce its final audited results for the year ended 31 March 2012.

Highlights for the year:

·; Profit on ordinary activities up more than 12% to £0.51 million (2011: £0.45 million);

·; Earnings per share up by 20% to 0.63p (2011: 0.52p);

·; NAV per share increased to 14.2p at the year-end (2011: 13.5p);

·; Carrying value of portfolio of rare and high quality coins of £10.11 million (2011: £10.07 million); and

·; Net cash of £1.30 million at year end (2011: £0.44 million).

Commenting on the results, Diane Clarke, Director of Avarae, said:

"Despite the continued economic difficulties throughout the financial markets and the Eurozone, Avarae has again successfully demonstrated that it is a genuine alternative asset play, as evidenced by it reporting material increases in profit and NAV for the year, together with some significant realisations of its investment portfolio. The Company has a strong balance sheet, including a coin portfolio with a carrying value, as reported on by industry experts, of more than £10.1 million and net cash of £1.3 million. The Directors, therefore, remain optimistic about the Company's future prospects."

The Company's audited report and accounts, together with the notice of the AGM, have today been posted to shareholders. An electronic copy of the audited report and accounts will also shortly be available on the Company's website: www.avarae.com.

For further information on Avarae Global Coins plc, please contact:

Directors' Report

Introduction

We are pleased to present the annual report for the year ended 31 March 2012 to our shareholders. The following pages show the financial position of the Company for the year ended 31 March 2012. During the year under review, the Company continued to manage its portfolio of rare and high quality coins.

Avarae Global Coins plc ("Avarae") provides access for institutions and individuals wanting to diversify their investment portfolios away from the traditional asset classes such as equities, property and bonds without the need to be an expert in the coin-collecting sector. The principal objective of the Company, as set out in its AIM admission document, is to achieve capital growth for its shareholders through the purchase, holding and sale of the rarest and highest quality segment of the coin-collecting sector in various countries around the world.

Investing policy

We are currently building up an impressive portfolio of extremely high quality, rare coins which we intend to hold both for the long-term (i.e. 3 to 5 years), in order to achieve long-term capital growth for our shareholders, and also the short-term, in order to take advantage of short-term trading opportunities, as the market for rare coins continues to grow. The value of each investment is expected to range from a few hundred pounds up to many hundreds of thousands of pounds. The most expensive coin acquired by Avarae to date is the Edward III Double Florin which was acquired for £0.4 million in 2006. The Double Florin is on display at the Fitzwilliam Museum in Cambridge.

The Board's decision on whether to acquire or dispose of a coin or coin collection is made on the recommendation of its industry expert independent Advisory Panel ("Panel") that assesses and approves all coin trading related activities. The Panel members are Sir John Wheeler and Clement Chambers, both of whom have significant expertise in the field of numismatics.

A principal objective of the Company is to achieve long-term capital growth through the appreciation in the value of the coins acquired. Compound annual returns potentially achievable over the medium to long-term for the highest quality and rarest coins are expected to be around 10 per cent., in line with historical averages. As at the date of this report, and since its formation in 2006, the Company has no borrowings and has no present intention of securing any borrowings.

The coin-dealing sector

The market for trading coins is international in nature and significant in size. For a number of years now, there has been an increasing interest in the coin sector and its prominence as an alternative investment class is illustrated by continued increases in activity around the world, where record prices have been paid for certain rare pieces. The number of interested parties in coins and coin collections appears to be continuing to grow, with auction houses reporting significant growth in the numbers of interested bidders compared to the corresponding auctions in previous years.

Segments of the coin market have proved relatively buoyant over the last 12 months, with certain sectors continuing to show healthy demand, such as English, Roman and Islamic coins. Other sectors, such as Chinese coins, have stayed flat at best and, in the case of the European examples (excluding British coins), some have marginally contracted. The weakening Euro exchange rate, general downturn and financial difficulties across the EU have dampened demand for German, Italian and French coins. That said, a number of auction houses have continued to achieve record prices, particularly for the highest quality, very rarest pieces.

Avarae's investments

Purchases

In the year to 31 March 2012, the Company acquired £0.81 million worth of coins (2011: £1.1 million), resulting in the value of the coin portfolio as at 31 March 2012 being £10.11 million (2011: £10.07 million). In line with its investment strategy, the Company has focused on the purchase of only the highest quality and rarest coins. In particular, during the year, the Company increased its exposure to Roman gold, English, Scottish, Anglo-Gallic and Islamic coins. 

Examples of coins acquired during the year include a number of Charles I Triple Unites. These coins are of particular rarity as the Triple Unite is the largest denomination hammered gold coin ever struck in England. Made between 1642 and 1644 at King Charles I's mint at Oxford during the English Civil War, only around 200 examples are known, many of which are owned by museums. They show the King holding both an olive branch and a sword, signifying a wish for peace.

In addition to the Triple Unites, we were delighted to acquire a Charles I Gold Half Unit or Double Crown, first issued between 1625 and 1634. This coin is the earliest gold issue by King Charles I in Scotland and carries the bust of his Father King James VI of Scotland who was the first to unite the Kingdoms of England and Scotland as he was also King James I of England from 1603-25. A particularly fine example of one of the rarest Scottish issues of King Charles I.

Our growing portfolio of Roman gold coins was enhanced by the addition of a Gold Aureus struck at Rome around AD200. This important dynastic gold Aureus shows the portraits of Geta and Caracalla, the sons of Septimius Severus. After the death of their father in York in A.D. 211, the control of the Roman Empire fell into the hands of the two brothers, until Caracalla arranged for Geta's assassination in A.D. 212 leaving him as sole ruler.

Sales

The sales highlight during the year for Avarae, as announced in October 2011, was the consignment of Chinese coins sold at auction in Hong Kong. Avarae had acquired the majority of these coins between 2007 and 2008 and had been revaluing each coin at the end of the subsequent financial year ends. Whilst the directors and numismatic advisory panel were cautiously optimistic of a strong showing, there remained some concerns that the then recent strong market for Chinese coins had overheated and was on the verge of declining. The directors were delighted that all but a handful of coins were sold at prices significantly ahead of their revalued amounts. As mentioned above, the market for high-end Chinese coins has tailed off over the last 6-9 months and the board is pleased to have realised the majority of its holding of Chinese coins during the year under review. Notwithstanding this, the Company continues to review the Chinese market with interest with a view to re-entering at some point in the future.

During the year, the Company also continued its efforts to rebalance the portfolio, liquidating some of the lower value items and inferior duplicates previously acquired as part of important collections. This process is ongoing and we expect to generate several hundred thousand pounds of sales during the current financial year as a result of this exercise.

English milled and hammered coins, as in previous years, represent the largest segment of the Company's portfolio, with holdings of Ancient Roman, Islamic, Indian and Italian coins

also representing significant proportions of the stock. Other sectors where Avarae holds coins of notable value includes USA, German, Chilean and Chinese coins.

Avarae's current intention is to hold the vast majority of its current portfolio for the foreseeable future and only make disposals of coins or collections when the Board believes it to be in the best interests of the Company and its shareholders.

Financial results

Revenue from the sale of coins or coin collections for the year ended 31 March 2012 was £1.7 million, down on the previous year's figures of £2.2 million.

As at 31 March 2012, in line with the strategy outlined in our AIM admission document and in previous reports, the Company instructed industry experts to undertake a detailed revaluation of its coin portfolio. This exercise is intended to apportion changes in the value of coins over the period of their ownership by Avarae rather than allocating profits (or losses) in the year of sale only. The Company's gross profit is calculated as the difference between the sale price of each coin less its carrying value brought forward, which will either be cost or the revalued amount. The industry experts considered the open market resale value of only those coins that had been held within the Company's portfolio for more than 12 months, i.e. only those coins acquired and held by Avarae on or before 31 March 2011 and excluded those purchased during the financial year under review, which were held at cost. In each of the years since the Company's inception, the Company has recorded a gross profit, thereby demonstrating the validity of the revaluation exercise.

The result of the extensive revaluation exercise carried out on the coins as described in the accounting policies, which the Directors believe to have been particularly conservative this year, was that the overall carrying value of the portfolio as at 31 March 2012 has increased to £10.11 million (2011: £10.07 million). The Directors consider this uplift in value to be particularly conservative and would expect coins from the portfolio to achieve appreciably higher returns if sold at auction. The effect of the 31 March 2012 revaluation exercise is that, as at 31 March 2012, the Company's coin portfolio comprised of coins purchased at cost for an aggregate £8.33 million (2011: £8.26 million) and a revaluation amount of £1.78 million (net of VAT payable on sale) (2011: £1.81 million).

The effect of the revaluation, together with the profits from the coin sales, resulted in the Company achieving an almost 10% increase in gross profit on the previous year to £0.89 million (2011: £0.81 million). The Directors continually strive to keep the Company's cost base to a minimum. As a result, administrative expenses during the year were in line with the previous year at £0.39 million (2011: £0.37 million), representing 3.4 per cent. of the Company's net assets (2011: 3.4 per cent.). Net profit for the year rose 12.5 per cent. to £0.51 million (2011: £0.45 million), resulting in an increase in EPS of almost 20% to 0.63p (2011: 0.52p).

The Company ended the year with a strong net cash balance of approximately £1.30 million, materially up on £0.44 million reported at the end of March 2011. The Company's cash is prudently managed across a spread of accounts, thereby reducing the risks of the creditworthiness of any one financial institution. During the year, investments of £0.81 million (2011: £1.1 million) were made in coins and coin collections. As at the year end, the Company had net assets of £11.43 million (2011: £10.92 million) and no borrowings. Net asset value per share ("NAV") as at 31 March 2012 increased by almost 5 per cent. to 14.2 pence (2011: 13.5 pence). Since 31 March 2007, being the date of the Company's first audited accounts, the Company's audited NAV has increased by 50% per cent.

Dividend

Reflecting the Company's continued increase in its NAV year-on-year, the Company's strong cash position, the increase in profits for the year ended 31 March 2012 and the board's cautiously optimistic outlook, the board is pleased to propose Avarae's maiden dividend, subject to shareholder approval to be sought at the Company's annual general meeting to be held on 11 September 2012. The dividend will be paid on or around 28 September 2012 to shareholders on the register on 14 September 2012.

The dividend policy adopted by the board is intended to be a progressive one and is expected to be declared on an annual basis. The level of the dividend will reflect the Company's reported profits over a three year period, thereby smoothing out any years of one off profits (or losses). The policy will be to pay out approximately 1/3 of the average net profits reported over the most recent three year period. For the year ended 31 March 2012, the level of the dividend will be approximately £0.15 million or 0.185 pence per share.

Purchases of own shares for cancellation

During the year ended 31 March 2012, the Company did not acquire any Ordinary Shares for cancellation (2011: 7,350,000).

Outlook

Despite the continued economic difficulties throughout the financial markets and the Eurozone, Avarae has again successfully demonstrated that it is a genuine alternative asset play, as evidenced by it reporting material increases in profit and NAV for the year, together with some significant realisations of its investment portfolio. The Company has a strong balance sheet, including a coin portfolio with a carrying value, as reported on by industry experts, of more than £10.1 million and net cash of £1.3 million. The Directors, therefore, remain optimistic about the Company's future prospects.

Statement of Comprehensive Income for the year ended 31 March 2012

Statement of Financial Position as at 31 March 2012

Cash Flow Statement for the year ended 31 March 2012

Statement of Changes in Equity for the year ended 31 March 2012

Notes to the Financial Statements for the year ended 31 March 2012

 (1) Accounting policies

Basis of accounting

The financial statements have been prepared under the historical cost convention and in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union ("EU"). This is the fifth year that the Company has prepared its financial statements in accordance with IFRSs, having previously prepared its financial statements in accordance with previous accounting standards. The functional currency is £-Sterling. 

Adoption of new and revised International Financial Reporting Standards ("IFRS"):

In the current year, the company has adopted the following new and revised standards and interpretations issued by the International Accounting Standards Board ("IASB") and the International Financial Reporting Interpretations Committee ("IFRIC") of the IASB that are relevant to its operations during the year. The adoption of these new and revised standards and interpretations has not resulted in any changes to the company's accounting policies that would affect the amounts reported for the current or prior years.

IFRS 1 First-time Adoption of International Financial Reporting Standards:

Introduces a limited exemption from comparative IFRS 7 Disclosures for First-time

adopters.

Effective for periods commencing on or after 1 July 2010.

IAS 24 Related Party Disclosures:

The disclosure requirements for government-related entities have been simplified by

clarifying the definition of a related party and providing a partial exemption for

government-related entities.

Effective for periods commencing on or after 1 January 2011

The following standards, amendments and interpretations have been issued but are not effective for the period commencing 1 April 2011 and have not been early adopted by the company.

IFRS 1 First-time Adoption of International Financial Reporting Standards

Replacement of 'fixed dates' for certain exceptions with 'the date of transition to

IFRSs and an additional exemption for entities ceasing to suffer from severe

hyperinflation.

Effective for periods commencing on or after 1 July 2011.

IFRS 7 Financial Instruments: Disclosures

Amendments enhancing disclosures about transfers of financial assets.

Effective for periods commencing on or after 1 July 2011.

IFRS 9 Financial Instruments

Deferral of mandatory effective date and amendments to transition disclosures.

Effective for periods commencing on or after 1 January 2015.

IFRS 13 Fair Value of Measurement

Effective for periods commencing on or after 1 January 2013.

IFRS 9 Presentation of Financial Statements

Amendments to revise the way other comprehensive income is presented.

Effective for periods commencing on or after 1 January 2013.

Adoption of new and revised International Financial Reporting Standards ("IFRS") (Continued):

IAS 27 Separate Financial Statements

Effective for periods commencing on or after 1 January 2013.

IAS 32 Financial Instruments: Presentation

Amendments relating to the offsetting of assets and liabilities.

Effective for periods commencing on or after 1 January 2013.

Revenue recognition

The Company's sales consist of sales of individual coins or collections of coins and are accounted for on an accruals basis.

Finance income is accounted for on a received basis.

(2) Segmental information

The Company has one class of business, that of the sale of antiquarian and collectable coins. All sales have been through dealers based in the single geographic segment of the United Kingdom. Accordingly no further segmental information is presented.

 (3) Taxation

The Company is resident for tax purposes in the Isle of Man.

The Company is chargeable to Isle of Man corporate income tax at the standard rate of 0%, which took effect from 6 April 2006.

(4) Earnings per share

The earnings per share (basic and diluted) for the year ended 31 March 2012 was 0.63p (2011: 0.52p). The calculation of earnings per share is based on the profit of £505,000 (2011: £450,000) for the year and the weighted average number of shares in issue being 80,783,334 (2011: 85,506,348).

 (5) Coin inventory

At the year end, only those coins that had been acquired by the Company before 31 March 2011 were revalued by industry experts to their expected current market value less the VAT payable on sale. Inventory purchased during the year ended 31 March 2012 has been carried at cost. This is considered by the directors to give a fair value for the inventory. Inventory of £10,112,000 (2011: £10,067,000) is carried as 'Inventory carried at fair value less costs to sell'. The purchase cost of inventory held at 31 March 2012 was £8,332,905 (2011: £8,259,165).

(6) Trade and other receivables

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

(7) Payables

All creditors are due within one year.

(8) Share capital and premium