Half Yearly Report

19 March 2014

CHURCHILL MINING PLC

("Churchill" or "the Company")

Interim Results

I am pleased to present Churchill Mining Plc's ("Churchill" or the "Company") Interim Report for the six months ended 31 December 2013.

During the half year the Group continued to actively seek recovery of shareholder value by progressing the international arbitration against the Republic of Indonesia at the International Centre for Settlement of Investment Disputes ("ICSID") in Washington DC.

The Republic of Indonesia had previously filed an objection to ICSID's jurisdiction to hear Churchill and its wholly owned subsidiary Planet Mining Pty Ltd's ("Planet") claim for damages.

On the 25th February 2014 the ICSID arbitral tribunal ("Tribunal"), comprising Prof. Gabrielle Kaufmann-Kohler (President), Mr. Michael Hwang S.C (Arbitrator) and Prof. Albert Jan van den Berg (Arbitrator), rejected the Republic of Indonesia's challenges to the Tribunal's jurisdiction.

In summary, the jurisdictional challenges by the Republic of Indonesia claimed:-

(i) the Republic of Indonesia had not consented to ICSID arbitration of the dispute with Churchill and its wholly owned subsidiary Planet Mining Pty Ltd ("Planet") under the UK-Indonesia and Australia-Indonesia Bilateral Investment Treaties,

and/or

(ii) even if the Tribunal found that the Republic of Indonesia had consented to ICSID arbitration as a general matter, the tribunal would still lack jurisdiction because Churchill and Planet's investments fell outside the scope of protected investments under the respective Bilateral Investment Treaties.

In its ruling, the Tribunal dismissed the Republic of Indonesia's challenges and found that the Tribunal has jurisdiction over the claims Churchill and Planet have submitted. Full copies of the Tribunal decisions on jurisdiction are available on the Company's website www.churchillmining.com.

Churchill has provided a preliminary estimate of its and Planet's damages as a result of the actions taken by the Republic of Indonesia of not less than USD 1.054 billion, excluding interest. This estimate remains under review and Churchill and Planet will finalise their damages presentation in the next stage of the arbitration proceedings.

Churchill and Planet continue to be represented in the ICSID arbitration by the highly regarded international law firm Quinn Emanuel Urquhart & Sullivan ("Quinn Emanuel"). Experienced London- based partner Stephen Jagusch heads the Quinn Emanuel team for Churchill/Planet.

The Company continues to reduce other administration and corporate overheads where possible to preserve the Company's cash position. As part of this, the Directors have agreed to accept equity securities in lieu of receiving cash payments in respect of Directors fees. The Company currently remains sufficiently funded to continue the work required on progressing the ICSID claim against the Republic of Indonesia.

During the half-year the Group disposed of its minority interest in ASX listed Spitfire Resources Limited ("Spitfire") for A$250,000. Apart from a minority direct interest in three of Spitfire's tenements in Western Australia, Churchill now has no business interests or activities other than its and Planet's arbitral claims against the Republic of Indonesia which continue to be Churchill's principal activity and focus for the group.

FINANCIAL REVIEW

The loss for the half year was $0.90 million or 0.73c per ordinary share (Dec 2012: $4.52 million or 3.69c per share and June 2013: $11.6 million or 9.45c per share). Other administrative expenses totalled $1.09 million (Dec 2012: $3.06 million and June 2013: $7.1 million).

Significant expenditure items during the period include:

· Legal and professional fees of $0.47 million (Dec 2012: $1.18 million) reflecting ongoing expenditure for the Company's arbitral claim against the Republic of Indonesia;

· Public relations, government and media outreach costs of $0.03 million (Dec 2012: $0.5 million) to assist in highlighting Churchill's position;

· Consulting, directors, staff and professional fees of $0.29 million (Dec 2012: $0.9 million) which reflects the planned reduction in corporate overheads.

The balance of operating expenditure is in line with the board's expectations and specific focus of management resources allocated to the current arbitral claim against the Republic of Indonesia.

The reduction in the net cash outflow from operating activities during the period reflects the board's efforts to reduce other administration and corporate overheads where possible to preserve the Company's cash position:

The Group's statement of financial position as at 31 December 2013 and comparatives at 31 December 2012 and 30 June 2013 are summarised below:

The Company started the half-year with $4.85 million in cash and remains sufficiently funded with cash at bank of $3.64 million at the date of issue of this report to pursue the ICSID arbitration and any other subsequent action to restore value for shareholders.

I can assure you the Board continues to work with diligence and enthusiasm to seek a suitable outcome for shareholders and I thank shareholders and staff for their continued support and will update on the Company's progress during the second half of the year.

David Quinlivan

Executive Chairman

18 March 2014

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 31 December 2013

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2013

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

NOTES TO THE INTERIM REPORT

NOTE 1: BASIS OF PREPARATION

The consolidated interim financial statements of the Group for the six months ended 31 December 2013 which comprise the Company and its subsidiaries (together referred to as the "Group") were approved by the Board for issue on 18 March 2014. The interim results have not been audited, but were subject of an independent review carried out by the Company's auditors BDO LLP. The interim financial information has been prepared on the basis of a going concern and in accordance with the recognition and measurement requirements of International Financial Reporting Standards (IFRS) and IFRIC interpretations issued by the International Accounting Standards Board (IASB) adopted by the European Union.

The accounts have been prepared in accordance with the accounting policies that are consistent with the June 2013 Report and Accounts and that are expected to be applied in the Report and Accounts of Churchill Mining Plc for the year ended 30 June 2014. There are new or revised standards or interpretations that apply to the period beginning 1 July 2013 but they do not have a material effect on the financial statements for the period ended 31 December 2013. The financial information for the six months to 31 December 2013 does not constitute statutory accounts of the Company or the Group. The statutory accounts for the year ended 30 June 2013 have been filed with the Registrar of Companies. The auditor's report on those accounts was unqualified, did not include any references to any matters to which the auditors drew attention by way of emphasis and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

The consolidated financial statements incorporate the results of Churchill Mining Plc and its subsidiary undertakings as at 31 December 2013. The corresponding amounts are for the year ended 30 June 2013 and the 6 month period ended 31 December 2012.

NOTE 2: LOSS PER SHARE

Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

NOTE 3: NOTES TO THE CASH FLOW STATEMENT

NOTE 4: TAXATION

No taxation has been provided due to losses in the period. No deferred tax asset has been recognised for past or current losses as the recoverability of any such asset is not considered probable in the foreseeable future.

NOTE 5: EVENTS AFTER THE REPORTING PERIOD

On the 7th January 2014, the Company issued 451,467 new ordinary shares of 1 pence at a deemed issue price of 22.23p per share. The shares were issued to Directors and Company Secretary who had agreed to subscribe for fully paid ordinary shares in lieu of receiving cash in respect of fees payable for the 2013 year.

On the 25th February 2014, the ICSID arbitral tribunal ("Tribunal") rejected the Republic of Indonesia's challenges to the Tribunal's jurisdiction and found that the Tribunal has jurisdiction over the damages claims Churchill and Planet have submitted.

Other than the above matter and events detailed elsewhere in this report, there has not been any other matter or circumstance occurring subsequent to the end of the reporting date that has significantly affected or may significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in future financial years.

NOTE 6: CONTINGENCIES

On 28th November 2012 the South Jakarta District Court held that the deeds of grant by which members of the Ridlatama Group transferred 75% of the issued share capital in two of the four licence companies that made up the East Kutai Coal Project (PT Ridlatama Tambang Mineral and PT Ridlatama Trade Powerindo) to PT TCUP are null and void on the basis that the requirements for a valid grant under Indonesian laws had not been satisfied. On 6th Dec 2012 PT ICD and PT TCUP filed a notices of appeal with the High Court in respect of the South Jakarta District Court's decision. The Company has been advised that in one of the appeals, the High Court of Jakarta has reached a decision, however, no copy of that decision is currently available. Should PT ICD and PT TCUP be unsuccessful in all avenues of appeal then it is likely that the receivables in the Statement of Financial Position before impairment would be reduced by $1.63 million due to these companies no longer being consolidated in the Group accounts. In addition the payables in the Statement of Financial Position would be reduced by $1.21 million. It remains the Group's position that the receivable and payable in the Statement of Financial Position are able to be offset. In the event that the balances cannot be offset the payable owing by the Group would not be settled until members of the Ridlatama group settled the receivable.

The Group is involved in various litigation disputes including an International arbitration claim against the Republic of Indonesia as detailed in the Chairman's Statement. As at the date of this report the disclosure of any further information about these matters would be prejudicial to the interests of the Group.

NOTE 7: FORWARD LOOKING STATEMENTS

This report contains certain forward looking statements, which include assumptions with respect to future plans and results. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Please refer to the Company's Annual Report available from the Company's web site for a list of risk factors. The Company's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive therefrom. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this report are made as at the date of this report.

NOTE 8: INTERIM REPORT

Copies of this interim report for the six months ended 31 December 2013 will be available from the offices of Churchill Mining PLC, 41 York Street Subiaco, WA, 6008 and on the Company's website www.churchillmining.com 

END

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