Half Yearly Report

Herencia Resources plc

("Herencia" or the "Company")

HALF-YEARLY FINANCIAL REPORT

For the six months ended 30 June 2011

Herencia Resources plc is pleased to announce the unaudited half-yearly accounts of the Company and its subsidiaries (the "Group") for the six months ended 30 June 2011.

CHAIRMAN'S STATEMENT

The six months ended 30 June 2011 has been an eventful period for Herencia. We believe we have moved significantly along the development path in relation to the Patricia resource at our Paguanta Project and we have added a second exciting project to the Company's portfolio, the Guamanga Copper-Gold Project.

The period commenced with the announcement that the Company had entered into an agreement to acquire a 51% controlling interest in the Guamanga copper-gold opportunity in Chile and that it had commenced a 15,000m drilling program at Paguanta as part of the broader Feasibility Study on the Patricia zinc-silver resource.

The Company also achieved further exploration success at Patricia with the confirmation of the Carlos vein (previously known as the "New" Vein) to the south of the main Cathedral vein. Diamond drilling returned, amongst other grades, a high grade result of 6m @ 5.9% zinc, 2.6% lead and 144g/t silver. We believe the Carlos vein has the potential to provide additional tonnage to our resource base.

During the period the Company also undertook drilling and exploration work at Doris/La Rosa with further work planned for these earlier stage prospects.

Subsequent to 30 June 2011, further zinc-silver-lead mineralisation was also identified approximately 80m south of the Carlos vein which bodes well for medium to long term resource expansion opportunities. We believe these results demonstrate the significant potential of the mineralised system at Patricia.

On the Engineering front, the Patricia Feasibility Study is being progressed by our experienced management team with metallurgical holes drilled and initial core samples dispatched to Canada for metallurgical test work. Geotechnical drilling also commenced to obtain core to be tested for detailed underground mine planning work which will be followed by geotechnical drilling of potential tailings dam and plant site locations in the third quarter of the year. On the Corporate and Administration side, the Company established an office in Santiago to accommodate the Project Management team which has been expanded as we progress toward project development.

On 1 July 2011 the Company successfully completed a placing through WH Ireland Limited, to raise £2.8 million from the issue of 125,000,000 new ordinary shares at a price of 2.25p per share. Nyrstar participated to maintain its position as Herencia's largest shareholder and we welcomed involvement in the raising from a Chilean investment fund.

These funds will largely be used toward advancing the Guamanga copper-gold project via a drilling program planned for the fourth quarter of 2011 and additional drilling of the Carlos vein at Patricia, and to advance engineering works including access road design and borefield exploration.

The Company is looking forward to continued success through 2011 at both the Paguanta and Guamanga projects.  We also remain vigilant for new opportunities in Chile, a country highly regarded as a mining destination.

Thank you to our shareholders for your continued support. We are committed to maximising shareholder value through the development of the proposed Patricia zinc-silver mine, drilling of the Guamanga copper-gold project, and exploration at Paguanta, against a backdrop of potentially stronger zinc, silver, copper and gold prices.

Hon. John Moore AO

Chairman

26 September 2011

Please refer to the project announcements at the Company's website (www.herenciaresources.com) for further information on the Company operations.

For further information please contact:

Michael Bohm, Herencia Resources plc Tel: +61 (0)8 9481 4204

Katy Mitchell, WH Ireland Limited Tel: +44 (0)161 832 2174

Simon Courtenay, City Profile Tel: +44 (0)207 448 3244

CONSOLIDATED STATEMENTS OF COMPRHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 June 2011

The results shown above relate entirely to continuing operations.

STATEMENTS OF FINANCIAL POSITION

AT 30 June 2011

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 June 2011

CONSOLIDATED STATEMENTS OF CHANGES in EQUITY

NOTES TO THE UNAUDITED HALF-YEARLY ACCOUNTS FOR THE SIX MONTH PERIOD ENDED 30 June 2011

1. Accounting policies

The condensed half-year accounts have been prepared using policies based on International Financial Reporting Standards (IFRS and IFRIC interpretations) issued by the International Accounting Standards Board ("IASB") as adopted for use in the EU. The condensed half-year accounts have been prepared using the accounting policies which are expected to be applied in the Group's statutory financial statements for the year ending 31 December 2011.

1.1. Basis of preparation and going concern

Herencia Resources plc ('the Company') is incorporated in England and Wales. The half-yearly accounts for the six months ended 30 June 2011 is un-audited and does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006.

The half-yearly accounts includes unaudited comparative figures for the half year ended 30 June 2010. The comparatives for the year ended 31 December 2010 are not the Company's full statutory accounts for that period but have been extracted from the statutory accounts for that period which have been delivered to the Registrar of Companies. 

The financial reports have been prepared using the historical cost convention and are presented in UK pounds sterling. The half-yearly accounts for the six months ended 30 June 2011 has been prepared in accordance with IAS 34 'Interim financial reporting'.

The half-yearly accounts for the six months ended 30 June 2011 has been prepared pursuant to AIM Rule 18, which states "An AIM company must prepare a half-yearly report in respect of the six month period from the end of the financial period for which financial information has been disclosed in its admission document and at least every subsequent six months thereafter (apart from the final period of six months preceding its accounting reference date for its annual audited accounts)."

The financial report has been prepared on the going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the normal course of business.

The operations of the Group are currently being financed from funds which the Company raised from private and public placings of its shares in the prior and current years. The Group has not yet earned revenue as it is still in the exploration phase of its business. The Group is reliant on the continuing support from its existing and future shareholders.

The Directors have reviewed the Group's overall position and outlook and are of the opinion that the Group will be able to raise the required funding to carry out the planned activities and provide working capital to enable it to meet its liabilities as they fall due, for the foreseeable future, and for at least the next twelve months from the date of approval of these financial statements. The directors therefore believe that the use of the going concern basis is appropriate.

2. Loss per share

The basic loss per ordinary share of (0.10)p (30 June 2010; (0.05)p, 31 December 2010; (0.10)p)for the Group has been calculated by dividing the loss for the period attributable to equity holders of £1,129,651 (30 June 2010; £435,465, 31 December 2010; £932,063) by the weighted average number of ordinary shares in issue of 1,259,882,343 (30 June 2010; 896,844,072, 31 December 2010; 949,650,555).

The diluted loss per share has been calculated using a weighted average number of shares in issue and to be issued of 1,259,882,343 (30 June 2010; 896,844,072, 31 December 2010; 965,020,301). The diluted loss per share has been kept the same as the conversion of share options decreases the basic loss per share, thus being anti-dilutive.

3. Segmental information 

The activities of the Group are broken down into the operating segments of Mineral Exploration and Central Costs. Segment information by operating segment and by region is as follows:

3. Segmental information (continued)

Segment information by region

At the end of the financial period, the Group had not commenced commercial production from its exploration sites and therefore had no turnover in the period.

6. Provisions

11. Contingent liabilities and capital commitments

The Group had no contracted capital commitments at 30 June 2011.

The Group had no contingent liabilities at 30 June 2011.

12. Decommissioning expenditure

The Directors have considered the environmental issues and the need for any necessary provision for the cost of rectifying any environmental damage, as might be required under local legislation. A provision of £64,654 has been made for any future costs of decommissioning or environmental damage.