Mr. Julian Treger reports

INTERIM RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 2017

Anglo Pacific Group PLC has released its interim results for the six months ended June 30, 2017, which are available on both the group's website and SEDAR.

Highlights

Results for the half year

• Free cash flow generated in first half 2017 of 18.9 million pounds sterling, a 300-per-cent increase on 4.7 million pounds sterling in H1 2016 and comfortably in excess of 13.4 million pounds sterling generated in fiscal year (FY) 2016;
• This includes 3.3 million pounds sterling from the Denison financing arrangement, of which 1.7 million pounds sterling relates to FY 2016 -- this arrangement has generated cash returns of $500,000 per month on average;
• Royalty income in H1 2017 of 16.1 million pounds sterling, a 295-per-cent increase from 4.1 million pounds sterling in H1 2016 and at 82 per cent of the 19.7 million pounds sterling earned for 2016 as a whole;
• Increase attributable mainly to higher commodity prices, favourable exchange rate and increased mining within private royalty land at Kestrel (88 per cent in H1 2017 and 95 per cent in Q2 2017 versus 38 per cent in H1 2016);
• Record royalty income from Maracas Menchen reflecting strong production and a significant improvement in vanadium prices; H1 2017 average of $5.46 (U.S.)/pound compared with $3.15 (U.S.)/pound in H1 2016, and currently in excess of $9.50 (U.S.)/pound;
• Increase in overheads to three million pounds sterling in H1 2017 from 1.8 million pounds sterling in the corresponding period, reflecting higher staff costs, including share-based payments and increased investment costs associated with sourcing and appraising royalty transactions;
• Adjusted earnings of 12.9 million pounds sterling for the first six months of 2017, a 438-per-cent increase on the 2.4 million pounds sterling equivalent in 2016 translating into adjusted earnings per share of 7.44 pence (H1 2016: 1.43 pence);
• Non-cash fair value charges of 14.9 million pounds sterling, mainly related to resource depletion and pricing assumptions led to a loss after tax of 2.5 million pounds sterling and loss per share of 1.46 pence (H1 2016: 10.2 million pounds sterling, 5.4 million pounds sterling and 3.18 pence, respectively);
• Interim dividend of three pence per share, to be paid on Nov. 15, 2017, which, in line with the company's recently announced payment policy change is about 85 days ahead of its previous payment timetable;
• Kestrel valuation of 107.5 million pounds sterling at June, 2017, down 8 per cent on 116.9 million pounds sterling at the beginning of the year -- mainly due to resource depletion and forward pricing assumptions;
• Net debt of 600,000 pounds sterling at June 30, 2017 (Dec. 31, 2016: 1.0 million pounds sterling) -- with all borrowings subsequently repaid following receipt of the Q2 2017 royalty income and after payment of the 2016 final dividend;
• Net assets of 209.6 million pounds sterling (Dec. 31, 2016: 210.1 million pounds sterling) translating into net assets per share of 116 pence (Dec. 31, 2016: 124 pence).

Outlook

• 2017 expected to continue the recent trend of recording significant growth in royalty income;
• About 90 per cent of Kestrel's coal sales over the next 12 months expected to be subject to the group's royalty;
• Commodity prices, particularly coking coal and vanadium, have beaten expectations to date in Q3 2017;
• Royalty revenues continue to benefit from a weak pound sterling exchange rate versus the U.S. and Australian dollar.

Julian Treger, chief executive officer, commented:

"Anglo Pacific has had a very strong start to 2017, which has seen us add to our portfolio with the Denison financing arrangement, report significant further increases in royalty revenue and become debt-free. This gave us the confidence to implement the payment of our dividend on a quarterly basis, to match the timing of our quarterly revenue and also to accelerate the timing of dividend payments postdeclaration.

"Mining at Kestrel is now firmly back to within the group's private royalty land. It is pleasing to see that this increased volume in mined coal that is subject to the group's royalty has coincided with a strong rebound in the coking coal price. This, along with the contribution from the rest of the portfolio and the recent Denison financing arrangement, has seen us post a doubling of income over the last two years and a similar outcome is expected this year.

"We have now repaid all of our borrowings, including the amounts drawn down as part of the Denison transaction, and have a fully covered dividend. The group has ready access to between $30.0-million (U.S.) and $40.0-million (U.S.) of cash and borrowing facilities for further royalty investments, and this is very much the focus for the second half of the year."

Analyst presentation

There will be an analyst presentation on the company's website today at the offices of Redleaf Communications, first floor, 4 London Wall Buildings, Blomfield Street, London, EC2M 5NT. The presentation will be hosted by Mr. Treger, Kevin Flynn (chief financial officer) and Juan Alvarez (head of investments). If you would like to attend please e-mail anlgopacific@redleafpr.com.

About Anglo Pacific Group PLC

Anglo Pacific Group is a global natural resources royalty company. The company's strategy is to develop a leading international diversified royalty and streaming company with a portfolio centred on base metals and bulk materials, focusing on accelerating income growth through acquiring royalties on projects that are currently cash flow generating or are expected to be within the next 24 months, as well as investment in earlier-stage royalties. It is a continuing policy of the company to pay a substantial portion of these royalties to shareholders as dividends.

                    CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)
                             (in thousands of pounds sterling)

                                                              Six months ended June 30,       
                                                                 2017             2016

Royalty income                                                 16,084            4,075
Amortization of royalties                                     (1,568)          (1,339)
Operating expenses                                            (3,039)          (1,825)


Operating profit before impairments,
revaluations and gain/(losses) on disposals                    11,477              911


Gain on sale of mining and exploration interests                   28                -
Revaluation and impairment
of royalty financial instruments                              (3,866)                -
Revaluation of coal royalties (Kestrel)                      (11,062)         (10,161)
Finance income                                                  1,233            1,318
Finance costs                                                   (399)            (423)
Other (losses)/gains                                            (438)              179
Loss before tax                                               (3,027)          (8,176)
Current income tax charge                                     (1,151)            (800)
Deferred income tax credit                                      1,646            3,595
Loss attributable to equity holders                           (2,532)          (5,381)
Total and continuing loss per share
Basic and diluted loss per share                              (1.46p)          (3.18p)

We seek Safe Harbor.