Half Yearly Report

ZincOx Resources plc

("ZincOx", the "Company" or the "Group")

Half Yearly Results for the six months ended 30 June 2014

ZincOx Resources plc (AIM Ticker: ZOX), the developer and operator of one of the world's largest zinc recycling plants, is pleased to announce its half yearly results for the six months ended 30 June 2014, a period of increasing production and revenue from its Korean Recycling Plant ("KRP").

Highlights

Korean Recycling Plant

· Revenues increased by 28% to US$17.8 million (2013: US$13.9 million)

· Continuing improvement to operating performance at KRP

· Zinc recovery over 90%

· Development Loan repayment extended to February 2016

· Guaranteed offtake extended to 840,000 tonnes

Other

· Appointment of Dr Rod Beddows as Chairman

· Overhead expenses reduced

· Average LME zinc price for 6 months increased by 6% to US$2,050 per tonne (2013: US$1,936)

· Loss per ordinary share 5.09 cents (2013: 17.05 cents)

· Cash of US$3.3 million at 30 June 2014

Commenting on the half yearly results, Dr Rod Beddows, non-executive Chairman said "There has been significant progress in increasing the reliability of KRP. In particular, since the major remediation work in August all aspects of the performance of the plant have shown improvement. The major problems that have affected our production in the past have now been addressed and this, together with the increasing zinc price, is most encouraging. We are confident that full production can be achieved by the year end."

For further information, please go to: www.zincox.com or contact:

Operations Review

Korean Recycling Plant ("KRP")

ZincOx is pleased to announce continuing improvements in the operating performance at its wholly owned Korean Recycling Plant, where Electric Arc Furnace Dust ("EAFD"), a waste generated by the recycling of galvanised steel scrap, is processed for the recovery of a zinc concentrate and an intermediate iron product.

During the first six months of the year, 60,555 tonnes of EAFD have been processed (H1 2013: 53,280 tonnes). The record month of production was in May 2014 when 13,826 tonnes of EAFD was processed producing revenue of US$3.7 million. Production in June 2014, (9,569 tonnes of EAFD; revenue of US$3.2 million) fell as a result of a short suspension of operation to carry out modifications that required a cooling of the furnace. However, the underlying performance of the plant has continued to improve. The inspection and maintenance closure, originally planned for September 2014, was brought forward to the end of July 2014 and extended to 24th August. This resulted in 11,788 tonnes of EAFD being processed during July producing revenue of US$3.8 million and an adjusted EBITDA1, excluding foreign exchange fluctuations, of US$0.6 million.

Since the beginning of the year, as a result of various modifications, plant performance has improved steadily although this has been masked by stoppages required to repair the heat exchangers and refractory failures.

As production rose, however, we found that an increasing proportion of the zinc product settles in the central part of the drop-boxes and was inaccessible to cleaning through the existing access doors. This build-up reduced offgas flow and so impacted on plant capacity. A short closure was required in June to make new access points which allow these areas to be cleared.

Before the maintenance closure in August, falling refractory caused a number of issues that constrained production in July resulting in 2,976 tonnes of zinc in concentrate being treated. During the maintenance closure, the heat exchangers were lined with refractory material which provides a physical barrier to the corrosive offgas but which still allows an efficient heat transfer. Modifications have also been made to the evaporative cooler and cleaning system of the filter bags. The refractory in several high temperature parts of the process had been badly affected by the numerous stoppages over the past two years, and several areas which appeared to be at risk were rebuilt. Finally, we replaced the outer curb of the hearth and the hearth bed.

The maintenance undertaken during the closure had an immediate and positive effect on performance with lower gas consumption, a more stable operation, better availability, increased recovery (>92%) and higher throughput (90% of target). Following the closure, however, it was necessary to carry out a full cleaning of the bags while in operation, which required reduced throughput for ten days in September. In spite of this reduction, the plant still produced about 3,000 tonnes of zinc in concentrate for the month. Following the bag cleaning, it has been possible, for the first time, to operate the plant at the full feed. These recent results are most encouraging and October is expected to set a new monthly production record. Further improvements and modifications are planned which should enable the plant to reach full production by the year end.

As part of the financing of the project a Development Loan for US$15 million was provided by Korea Zinc Company Ltd ("Korea Zinc"). As KRP would not have generated sufficient cash to repay the loan scheduled for repayment in February 2015, Korea Zinc, in September 2014, agreed to extend the repayment date by one year so that it will now fall due in February 2016. This extension should allow KRP to generate sufficient cash to repay the Development Loan by this date.

In return for the loan extension, ZincOx has agreed to increase the overall tonnage of zinc oxide to be supplied to Korea Zinc to 840,000 tonnes, an increase of 70,000 tonnes; the effect of which is to extend the life of the Offtake Agreement by about one year. In all other respects the agreements remain unchanged.

Other Activities

While the principal efforts of the executives and staff are focused almost entirely on ensuring KRP reaches full production as rapidly as possible, other activities are being undertaken. The plant has consistently

1 Earnings before interest, tax, depreciation and amortisation (adjusted to exclude foreign exchange gains and losses)

produced a zinc concentrate of exceptional quality. The Company has successfully completed testwork that demonstrated that our product can be simply and cheaply upgraded to a zinc oxide of industrial purity. This material would benefit terminal markets in a significantly more valuable fashion than its sale to smelters. The upgrading process results in the production of a clean brine suitable for marine discharge, so processing plants will need to be situated at the coast. However, this brine removal can also be carried out at Big River Zinc, the Company's plant in St Louis, USA, which is already permitted for this type of discharge and where it is planned, using existing equipment, to run a short commercial trial. This will demonstrate the cost and effectiveness of this upgrading, and provide samples for test marketing.

It remains our intention to roll out the Company's rotary hearth furnace ("RHF") technology around the world and progress is being made in a number of countries, most particularly in Thailand.

In Thailand, we have identified an excellent site, which is adjacent to a container and bulk handling port, with the full range of services and utilities. Planning for a Thai plant has commenced and negotiations for dust supply are underway. The Thai plant is likely to have a capacity of 100,000 tonnes of dust per annum but would include upgrading facilities for the production of an industrial grade zinc oxide chemical. The value of the upgraded product would be about twice that of zinc concentrate.

Corporate

In July 2014, Dr Rod Beddows was appointed to be the Chairman of the Group thereby separating the roles of Chairman and Chief Executive Officer in line with the undertaking given to the International Finance Corporation following its investment in the Company at the end of 2013. Andrew Woollett remains as the Company's Chief Executive Officer.

As a result of repair work, the ramp-up to full production has been slower and more costly than planned; it was therefore necessary for further funds to be raised. In April, £3.1 million was raised by way of an equity Placing and Open Offer in order to see the Group through to a time when its ongoing costs will be covered by revenues generated from KRP.

Financial Results

The Group loss after tax, attributable to shareholders of the parent company, was US$7.6 million for the six months (period to 30 June 2013: loss of US$17.6 million, year to 31 December 2013: loss of US$26.3 million). This represents a loss per ordinary share of 5.09 cents (period to 30 June 2013: loss per share 17.05 cents, year to 31 December 2013: adjusted loss per share 24.75 cents).

The Group revenue includes sales of zinc oxide from KRP totalling US$17.5 million in the six months (period to 30 June 2013: US$13.8 million, year to 31 December 2013: US$27.1 million). The revenue for the Group improved by 28% for the six months to 30 June 2014 compared to the first half of 2013. It is worth noting that the zinc price fluctuated during the period within the range of US$1,942 to US$2,204 per tonne of zinc. The market analysts covering the zinc sector continue to talk of a shortage of zinc due to mine closures in the next twelve to eighteen months. The global inventory of zinc fell by 263,225 tonnes (28%), in the six month period from 931,175 tonnes at the start of January to 667,950 at the end of June. The closing price on the 26 September was US$2,270 per tonne.

The directors have reviewed the future forecasts and funding requirements of the Group based on an underlying set of assumptions for the ramp-up at KRP and zinc price. They will continue to keep under review the availability of funds and assess if further capital is required. For these reasons they continue to adopt the going concern basis in preparing these financial statements.

Principal Risks and Uncertainties

The principal risks and uncertainties facing the Group have not changed from those disclosed in the Annual Report 2013.

Outlook

The key focus of the Group remains the completion of the ramp-up to full production of KRP so that the cashflow from it will be able to repay the loans when they fall due and to provide a cashflow to the Group.

Dr Rod Beddows

Chairman

30 September 2014

Forward Looking Statements

The Operations Review contains discussion of future operations and financial performance by use of various forward looking words such as "anticipates," "estimates," "expects," "projects," "intends," "plans," "believes" and terms of similar substance. These forward looking statements are based on management's current expectations and beliefs about future events but as with any projection or forecast, they are inherently susceptible to uncertainty and changes in circumstances which could cause the Group's actual activities and results to differ materially from those contained in the forward looking statements.

ZincOx Resources plc

Consolidated Interim Income Statement

 for the period ended 30 June 2014

ZincOx Resources plc

Consolidated Interim Statement of Comprehensive Income

for the period ended 30 June 2014

ZincOx Resources plc

Consolidated Interim Balance Sheet

at 30 June 2014

ZincOx Resources plc

Consolidated Interim Cash Flow Statement

for the period ended 30 June 2014

ZincOx Resources plc

Consolidated Statement of Changes in Shareholders' Equity

at 30 June 2014

Notes to the Consolidated Financial Interim Statements

1. Basis of Preparation

These interim condensed consolidated financial statements are the unaudited Consolidated Financial Statements of ZincOx Resources plc, for the six months ended 30 June 2014. They have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the EU and the Companies Act 2006, applicable to companies reporting under IFRS. They do not include all of the information required in annual financial statements in accordance with IFRS, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 December 2013.

These interim financial statements were approved by the Board on 29 September 2014. The financial information set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2013, prepared under IFRS, have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain statements under Section 498(2) or Section 498(3) of the Companies Act 2006.

These financial statements have been prepared under the historical cost convention and the consolidated financial statements incorporate the financial statements of the Company and its subsidiary companies.

The financial information for the six months ended 30 June 2014 and 30 June 2013 is unaudited.

2. Significant Accounting Policies

The accounting policies and presentation followed in the preparation of this interim report have been consistently applied to all periods in these financial statements and are the same as those applied by the Group in the preparation of its Annual Report for the year ended 31 December 2013.

 3. Critical Accounting Estimates and Judgements

The Group performs an annual assessment of the recoverability of assets to see whether any of the projects have suffered impairment. This assessment is only done at the end of each year unless there are indicators of impairment apparent in the period.

 4. Underlying Operating Loss

The underlying operating loss is stated before exceptional items including impairment provisions but after any foreign exchange gains or losses.

5. Loss per Share

The calculation of basic and diluted loss per ordinary share is based on the loss attributable to ordinary shareholders of US$7,555k (period to 30 June 2013: US$17,640k, year to 31 December 2013: US$26,331k) divided by the weighted average number of shares in issue during the year of 148,324,222 (period to 30 June 2013: 103,466,716, year to 31 December 2013: 106,370,166).

There is no dilutive effect of the share options in issue.

6. Post Balance Sheet Events

On 7 July 2014, Dr Rod Beddows was appointed as the Chairman of the Company with Andrew Woollett remaining as Chief Executive Officer.

On 3 September 2014, the Company agreed with Korea Zinc (Company) Ltd to extend the repayment date for the US$15m Development Loan by one year to February 2016.

7. Further copies of this statement

Copies of this statement are available for download from the Company's website at www.zincox.com or on request from the Company Secretary, ZincOx Resources plc, Knightway House, Park Street, Bagshot, Surrey, GU19 5AQ, United Kingdom.