Final Results

North River Resources plc / Ticker: NRRP / Index: AIM / Sector: Mining

11 March 2011

North River Resources plc ('North River' or 'the Company')

Final Results

North River Resources plc, the AIM listed multi-commodity resource company, announces its results for the 18 months to 31 December 2010.

Managing Director's Statement

North River Resources plc has made a great deal of progress during the period, both in terms of developing our wholly owned portfolio of assets in Namibia and securing joint venture agreements ('JVs') to rapidly advance our other interests. The Board has also identified and acquired additional licences with which to increase the Company's already significant mineral footprint and further diversify its commodity focus.

By building and developing North River's portfolio through acquisition and JVs the Company has a strong foundation for future growth. We remain focussed on evaluating additional assets for acquisition, which meet our stringent investment criteria to create value for shareholders.

Namibia

Namib Lead & Zinc Mine ('Namib Mine') - 100% owned

During the period, the underground workings of the Namib Mine were made safe and surveyed. Following the survey, exploration drill positions were identified underground and work is now underway constructing drill positions and installing services. It is expected a rig will be positioned underground shortly and drilling will commence imminently.

Nuclear Fuels - JV with Extract Resources Limited ('Extract')

As announced on 21 September 2010, North River signed an agreement with a major Australian uranium explorer, Extract, to jointly develop three highly prospective uranium licences in Namibia.

The principal assets involved in this agreement are Exclusive Prospecting Licence ('EPL') 3327 and EPL 3328, which are located in a globally significant and highly prospective uranium district. Located west and north respectively of the historic tin mining centre of Uis in the west of the country, previous exploration activity, undertaken by Extract, has shown that these licences have the potential to host secondary uranium deposits associated with palaeodrainages of the Orawab and Ugab ephemeral river systems.

A comprehensive work programme for these nuclear fuels licences has been devised and will commence shortly.

Witvlei and Dordabis Copper Projects ('Witvlei and Dordabis') - 100% owned

Following a data review in 2010, North River intends to conduct diamond drilling on both Witvlei and Dordabis licence areas, in order to obtain samples for metallurgical test work.

Ubib Copper/Gold Project ('Ubib') - 100% owned

At Ubib, the Company completed a full data review and generated a number of exploration targets, some of which have been tested and some are ongoing. Good results were obtained at Tsabichas, with 45 out of 163 rock chip samples returning in excess of 1g/t Au with the best result being 48.9 g/t Au and the next best result being 18.9 g/t Au. A combination of ongoing rock chip sampling and ground based magnetic surveys are anticipated to commence soon.

New Licences - 100% owned

Post period end, the Company was granted four new EPLs covering 3,838km2. The new licences cover two project areas, Kamkas and Hero, and have been granted for base, rare and precious metals, as well as industrial minerals and non-nuclear fuels, for a period of three years expiring 16 January 2013.

Hero

The Hero Project comprises three contiguous licences, EPL4487, EPL4488 and EPL4489, located to the east of Grootfontein and the established mining town of Tsumeb in the Grootfontein and Rundu Regions of Northern Namibia.

The geology of the area is underlain by the Cenozoic Kalahari Group and unconsolidated sands of the Kalahari Desert. The area is considered prospective for extensions of the Neoproterozoic Damara Supergroup, which host significant deposits such as the Tsumeb polymetallic deposit, the Kombat Copper Mine, the Berg Aukas Lead-Zinc Mine. These extensions continue under the Kalahari sand cover sequences and are believed to be between 50m and 200m thick.

The extension of the rocks which host these significant base and precious metals deposits are the target for future work by the Company. Existing regional airborne geophysical data will be acquired and this will be complemented with additional airborne surveys if required. Follow-up ground geophysical surveys will be followed by drilling.

Kamkas

The Kamkas Project, which comprises EPL4419, is located in the Maltahohe region of southern Namibia near the town of Maltahohe. The area is underlain by Nama Group rocks of Cambrian/Neoproterozoic age which cover older Basement rocks of the Mesoproterozoic Sinclair Group. The area is characterised by a prominent airborne magnetic anomaly which occurs at the intersection of several regionally significant structural lineaments. However, the source of the magnetic anomaly is not yet known and there has been no previous exploration for base and/or precious metals carried out in the area.

Water borehole drilling in the area in recent years indicated elevated copper-zinc-lead-silver ('Cu-Zn-Pb-Ag') values in a grab sample from the drill cuttings, but from an unknown depth within the borehole. The Company plans to commence initial reconnaissance work in the area with the aim of generating potential targets prior to the commencement of a drilling programme to define the source of the elevated values of Cu-Zn-Pb-Ag.

Mozambique

The Company recently signed two JVs in regard to its Mozambican assets in order to accelerate development of the licences and deliver value to shareholders.

Monte Muande - JV with Baobab Resources plc ('Baobab')

In November 2010, the Company signed a JV agreement with Baobab for the development of the Monte Muande licences in Mozambique, which are prospective for magnetite, phosphorus, uranium and gold.

Baobab immediately commenced compilation of historical exploration data, ahead of a planned drilling programme in Q2 2011. Initial results from this data compilation exercise have yielded encouraging results, underpinning the prospectivity of this multi-commodity project area. The work programme, undertaken and fully funded by Baobab, produced positive drill hole and trench results with significant magnetite/phosphorus intercepts and geochemistry results demonstrating the potential for a significant mineralised extension.

Mavuzi - JV with Jacana Resources Limited ('Jacana')

Post period end, the Company signed a JV agreement with Jacana over the Mavuzi licences, which cover 54,580ha in Mozambique. The licences, which include the Castro and Inhatobui targets and the previously producing Mavuzi and Castro uranium mines, are prospective for uranium and rare earth elements ('REEs').

This agreement is designed to rapidly advance the Mavuzi licence, which contains a number of historic uranium workings, the significant Inhatobui radiometric target, together with gold, base metal and rare earth prospectivity, adding value as the project advances up the development curve. We look forward to receiving regular updates from Jacana as it commences its work programme and begins the active development of the project.

Outlook

North River delivered a solid performance during the 18 month period to 31 December 2010 and achieved its stated goals of entering JVs on various properties and securing additional exploration licences. It now has the foundation in place to grow via its exploration efforts and to build on its position as an emerging exploration and development company.

North River looks forward to commencing drilling on four properties starting in Q1 2011 and starting exploration work on four more as well as continuing work at Ubib. In addition, it anticipates commencing drilling on three Mozambique properties via the JVs starting Q1 2011.

The Board continues to evaluate potential acquisitions, but will only enter into transactions that are clearly going to be value enhancing for the Company's shareholders. It has assessed a great many potential acquisitions but, to date, none have made a compelling investment case. The Company continues this process while increasing the level of exploration activity on its existing exploration properties.

I would like to take this opportunity to thank our shareholders and my fellow board members for their continued support.

David Steinepreis

Managing Director

4 March 2011

For further information please visit www.northriverresources.com or contact:

Consolidated Statement of Comprehensive Income

for the period from 1 July 2009 to 31 December 2010

Consolidated and Parent Company Statements of Financial Position

as at 31 December 2010

Consolidated and Parent Company Statements of Changes in Equity

for the period from 1 July 2009 to 31 December 2010

Consolidated and Parent Company Statements of Changes in Equity

for the period from 1 July 2009 to 31 December 2010

Consolidated and Parent Company Statements of Cash Flows

for the period from 1 July 2009 to 31 December 2010

Cash and cash equivalents comprise cash on hand and bank balances.

Notes to the Financial Statements

for the period from 1 July 2009 to 31 December 2010

The Group has adopted the accounting policies set out below in preparation of the financial statements. All of these policies have been applied consistently throughout the period unless otherwise stated.

The financial statements are prepared in accordance with the historical cost convention and in accordance with the International Financial Reporting Standards ("IFRSs") including IFRS 6, Exploration for and Evaluation of Mineral Resources, as adopted by the European Union ("EU") and in accordance with the provisions of the Companies Act 2006.

The Group's financial statements for the period ended 31 December 2010 were authorised for issue by the board of directors on 4th March 2011 and the balance sheets were signed on the board's behalf by David Steinepreis. The Group financial statements are presented in UK pounds sterling.

In accordance with the provisions of Section 408 of the Companies Act 2006, the Parent Company has not presented an income statement. A loss for the eighteen months ended 31 December 2010 of £6,142,318 (year ended 2009: loss of £299,220) has been included in the income statement.

During the period ended 31 December 2010 the Group made a loss of £7,397,418 (2009: a loss of £299,220). At the balance sheet date the Group had net assets of £11,727,338 (2009: net liabilities of £197,686) of which £3,536,920 was cash at bank. The operation of the Group is currently being financed from funds which the Company raised from private and public placings.

The Group's capital management policy is to only raise sufficient funding to finance the Group's near term exploration and development objectives. Upon completion of objectives, or identification of new projects, the Directors will seek new funding to finance the next stage of the development programme or the new projects. The Directors believe that the Group has sufficient funds for it to comply with its foreseeable commitments and, accordingly, are satisfied that the going concern basis remains appropriate for the preparation of these financial statements. The Group will need additional funding to support the next stage of its development programme.

The following amendments to standards are mandatory for the first time for the financial periods commencing on or after 1 January 2009.

IAS1 (revised) 'Presentation of financial statements' includes the requirement to present a Statement of Changes in Equity as a primary statement and introduces the possibility of either a single Statement of Comprehensive Income (combining the Income Statement and a Statement of Comprehensive Income) or to retain the Income Statement with a supplementary Statement of Comprehensive Income. The Directors have chosen the first option. As this standard is concerned with presentation only it does not have any impact on the results or net assets of the Group.

IFRS8 'Operating segments' replaces IAS 14 'Segment reporting'. It requires a 'management approach' under which segment information is presented on the same basis as that used for internal reporting purposes. Following a review of the Group's internal management information, the Group maintains that it only has one class of business, the exploration and development of mineral resources and that primary segmental reporting is determined by geography according to the location of assets, which currently are based in Namibia and Mozambique.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as the Board of Directors.

The consolidated financial statements incorporate the accounts of the Company and its subsidiaries and have been prepared by using the principles of acquisition accounting ("the purchase method") which includes the results of the subsidiaries from their date of acquisition. Intra-group sales, profits and balances are eliminated fully on consolidation.

Goodwill is the difference between the amount paid on the acquisition of the subsidiary undertakings and the aggregate fair value of their separable net assets. Goodwill is capitalised as an intangible asset and in accordance with IAS 36 'Impairments of Assets' is not amortised but tested for impairment annually and when there are any indications that its carrying value is not recoverable. As such, goodwill is stated at cost less any provision for impairment in value. If a subsidiary undertaking is subsequently sold, goodwill arising on acquisition is taken into account in determining the profit and loss on sale.

Where appropriate the Group reviews the carrying amounts of its tangible assets, intangible assets and investments to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the statement of comprehensive income, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years.

Property, plant and equipment are stated at cost less accumulated depreciation and any recognised impairment loss. Depreciation is charged so as to write off the costs of assets, over their estimated useful lives, using the straight line method, on the following basis:

Plant and machinery 4 years

Motor vehicles 4 years

Fixtures, fittings and equipment 4 years

Computers and software 3 years

The Group capitalises the fair value of the consideration paid for exploration and prospecting rights. All other costs incurred are expensed as they are incurred. The Group has taken into consideration the degree to which expenditure can be associated with finding specific mineral resources. The intangibles are amortised over the length of the mining licences and the amortisation expense is included within the Administration expenses line in the statement of comprehensive income.

Revenue is measured at the fair value of consideration received or receivable from the sale of goods and services from the Group's ordinary business activities. Revenue is stated net of discounts, sales and other taxes. There was no revenue received in the year.

The only bank interest received in the year was on cash held at bank.

Operating expenses are recognised in the statement of comprehensive income upon utilisation of the service or at the date of their origin. Interest income and expense are reported on an accrual basis.

The Parent Company's investments in subsidiary companies are stated at cost less provision for impairment in the Company's balance sheet.

Items included in the Group's financial statements are measured using the currency of the primary economic environment in which the Group operates ("the functional currency"). The financial statements are presented in pounds sterling ("£"), which is the functional and presentational currency of the Company and the presentational currency of the Group.

Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated using the rate of exchange ruling at the balance sheet date and the gains or losses on translation are included in the profit and loss account. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the original transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

The assets and liabilities of foreign operations are translated into sterling at the rate of exchange ruling at the balance sheet date. Income and expenses are translated at weighted average exchange rates for the period. The resulting exchange differences are recognised in other comprehensive income.

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax is realised or the deferred liability is settled.

Deferred tax assets are recognised to the extent that it is probable that the future taxable profit will be available against which the temporary differences can be utilised.

Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short term deposits held at call with banks and other short term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Receivables are carried at original invoice amount less provision made for impairment of these receivables. A provision for impairment of receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The amount of the provision is the difference between the assets' carrying amount and the recoverable amount. Provisions for impairment of receivables are included in the income statement.

Trade payables and other payables represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services. The amounts are unsecured and are usually paid within 30 days of recognition.

Ordinary shares are classified as equity. Incremental costs directly attributable to the increase of new shares or options are shown in equity as a deduction from the proceeds.

The Company has granted equity-settled options. The cost of equity settled transactions with employees is measured by reference to the fair value at the date on which they were granted and is recognised as an expense over the vesting period, which ends on the date the employee becomes fully entitled to the award. Fair value is determined by using the Black-Scholes option pricing model. In valuing equity settled transactions, no account is taken of any service and performance (vesting conditions), other than performance conditions linked to the price of the shares of the Company (market conditions). Any other conditions which are required to be met in order for an employee to become fully entitled to an award are considered to be non-vesting conditions. Like market performance conditions, non-vesting conditions are taken into account in determining the grant value.

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market or non-vesting condition, which are vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance or service conditions are satisfied.

At each balance sheet date before vesting, the cumulative expense is calculated; representing the extent to which the vesting period has expired and management's best estimate of the number of equity instruments that will ultimately vest. The movement in the cumulative expense since the previous balance sheet date is recognised in the income statement, with a corresponding entry in equity.

Where the terms of the equity-settled award are modified or a new award is designated as replacing a cancelled or settled award, the cost based on the original award terms continues to be recognised over the original vesting period. In addition, an expense is recognised over the remainder of the new vesting period for the incremental fair value of any modification, based on the difference between the fair value of the original award and the fair value of the modified award, both as measured on the date of the modification. No reduction is recognised if the difference is negative.

Where an equity based award is cancelled (including when a non-vesting condition within the control of the entity or employee is not met), it is treated as if it had vested on the date of the cancellation, and the cost not yet recognised in the income statement for the award is expensed immediately. Any compensation paid up to the fair value of the award at the cancellation or settlement date is deducted from equity, with any excess over fair value being treated as an expense in the income statement.

The preparation of financial statements in conformity with International Financial Reporting Standards requires the use of accounting estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Although these estimates are based on management's best knowledge of current events and actions, actual results ultimately may differ from those estimates. IFRSs also require management to exercise its judgement in the process of applying the Group's accounting policies.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are as follows:

Valuation of goodwill and investments

Management value goodwill and investments after taking into account potential ore reserves, and cash-flow generated by estimated future production, sales and costs. If the assumed factors vary from actual occurrence, this will impact on the amount at which the asset should be carried on the balance sheet.

Further detailed analysis of the critical judgements and estimates relating to goodwill and investments is addressed in Note 16.

Share based payments

The Group records charges for share based payments.

For option based share based payments management estimate certain factors used in the option pricing model, including volatility, exercise date of options and number of options likely to be exercised. If these estimates vary from actual occurrence, this will impact on the value of the equity carried in the reserves.

Further detailed analysis of the critical judgements and estimates relating to share based payments is addressed in Note 15.

IFRS7 requires information to be disclosed about the impact of financial instruments on the Group's risk profile, how the risks arising from financial instruments might affect the entity's performance, and how these risks are being managed.

Financial assets and financial liabilities are recognised on the balance sheet when the Company becomes a party to the contractual provisions of the instrument.

The Group's policies include that no trading in derivative financial instruments shall be undertaken.

The required disclosures have been made in note 18 to the accounts.

Basic earnings per share is calculated by dividing the profit / (loss) attributable to equity holders of the Company, excluding any costs of servicing equity other than dividends, by the weighted average number of Ordinary shares in issue, adjusted for any bonus elements.

Diluted earnings per share is calculated as net profit / (loss) attributable to members of the Company, adjusted for:

·; costs of servicing equity (other than dividends);

·; the after tax effect of dividends and interest associated with dilutive potential Ordinary shares that have been recognised as expenses; and

·; other non-discretionary changes in revenues or expenses during the year that would result from the dilution of potential Ordinary shares.

Share options are considered anti-dilutive as the Group is in a loss making position.

As disclosed in note 12 the Company's share capital was consolidated on a two for one basis on 26 August 2009. As such, the current and comparative basic and diluted earnings per share disclosures have been prepared on the basis of the consolidated share capital.

The IASB and IFRIC have issued a number of new standards, amendments and interpretations with an effective date after the date of these financial statements. Of these, only the following are expected to be relevant to the Group:

None of these standards are expected to have a material impact on the Group's financial statements.

For the purposes of segmental information, the operations of the Group are focused in the United Kingdom, Namibia and Mozambique and comprise one class of business: the exploration and evaluation of mineral resources. In the year to 30 June 2009 the Group held assets in Australia but these have been divested.

The Company acts as a holding company.

The Group's operating loss for the period arose from its operations in the United Kingdom, Namibia and Mozambique. In addition, all the Group's assets are based in the United Kingdom, Namibia and Mozambique.

Geographical Segment - Group 31 December 2010

At the end of 31 December 2010, the Group had not commenced commercial production from its explorations sites and therefore had no turnover for the period. Other income relates to the sale of scrap metal arising from the removal of the old mine head at the Namib Lead and Zinc mine in Namibia.

Geographical Segment - Group 30 June 2009

The consolidated operating loss before tax is stated after charging:

Options in issue are not considered diluting to the earnings per share as the Group is currently loss making.

In accordance with the Share Purchase Agreement (dated 5 October 2009) entered into with Kalahari Gold Ltd, Kalahari Diamonds Ltd and Kalahari Minerals plc, the Company acquired, on 20 November 2009, the entire issued share capital in, and the shareholder loans to, West Africa Gold Exploration (Namibia) (Pty) Ltd ("WAGE") and Namib Lead and Zinc Mining (Pty) Ltd ("Namib Lead"), formerly Craton Diamonds (Pty) Ltd. The consideration paid by the Company for these two Namibian entities and the shareholder loans was satisfied by the allotment of 266,666,667 Ordinary shares of £0.002 ("Ordinary shares") each at 3 pence per Ordinary share.

The combined loss for WAGE and Namib Lead since the acquisition date and included in the Consolidated Statement of Comprehensive Income for the reporting period is £1,255,100.

If the acquisition of WAGE and Namib Lead had occurred on the first day of the reporting period the consolidated loss for the Group would be £8,063,874.

The acquisition of the two Namibian entities has been accounted for using acquisition accounting ("the purchase method"). The aggregate assets and liabilities were as follows:

Note a:

Following the acquisition of WAGE, on 2 March 2010, the Company issued 2,200,000 Ordinary shares at 3 pence per Ordinary share to two individuals in exchange for the royalty contracts of WAGE's future earnings owned by the individuals.

It is the Directors' view that whilst the acquisition of the royalty contracts increases the value of WAGE to the Group no separately identifiable asset has been created, accordingly an increase to goodwill has been recognised.