Griffin Mining Limited (“Griffin” or “the Company”) has today published its results for the year ended 31 December 2005.

Highlights:

• Successful commissioning of the Caijiaying Zinc-Gold mine in China in July 2005
• First profit from operations in 2005 of US$426,000 (2004 loss restated US$1,557,000), and a consolidated profit for the year of US$311,000 (2004 loss restated US$111,000)
• Operating profit of US$1,283,000 in the six months to 31 December 2005
• Significant increases in production and recovery rates
• Ongoing exploration programme to investigate further zinc and gold mineralisation
• Continued evaluation of further economically justifiable acquisitions

The Company has successfully developed, built, commissioned and now operates very profitably, the Caijiaying Zinc-Gold mine in the People's Republic of China (the “PRC”). This is a landmark achievement for the Company, the mining industry and the PRC.

At Company level, the Caijiaying mining operations guarantee the long-term financial success of Griffin. This financial success has been even further enhanced by the dramatic rise in the price of commodities, and in particular, the extraordinary rise in the price of zinc. The Company's feasibility study was commissioned using a US$760 a tonne zinc price. Knowing that mining is essentially a fixed cost business, next years financial statements should admirably exhibit what a zinc price of US$3,300 a tonne can do for the financial performance of the Company.

Of course, this is just the beginning. With no debt on the balance sheet, no hedging commitments and a fully built and operating processing plant at Caijiaying located adjacent to a long life ore body, the financial future of the Company has been well secured. However, the Company remains fully focused on generating even greater returns for its shareholders. This will be achieved in three major ways:

1. A continuing drive to expand the throughput and, ipso facto, the amount of zinc metal being generated by the Caijiaying processing facilities. The plant was designed and built to process 200,000 tonnes of ore per annum. Within seven months, the Company has already increased throughput by 50% and is currently processing approximately 300,000 tonnes of ore on an annualised basis. A striking achievement by the Company. Needless to say, the Company continues to drive to increase throughput even further.

2. As evidenced by the announcements made by the Company during the year, the exploration potential of the greater Caijiaying area improves every day as we seek to discover the mysteries that Mother Nature has hidden beneath the surface. As this is written and spring rears its head, an RC drill rig has been mobilized at Caijiaying to begin drilling the epithermal gold targets south of Zone II. Furthermore, the Company has approved the driving of another decline into Zone II, from the base of which the Company has commissioned a significant underground drilling programme to investigate further zinc and gold mineralisation. The Company has every hope that Zone II will become a second mine for the Company and an alternative source of ore for the Caijiaying processing plant.

3. The Company continues to investigate and evaluate further potential acquisitions. That process has become substantially more difficult by the buoyancy of the commodities market which has filtered through to the financing of a large number of marginal and uneconomic mineral deposits. This will, inevitably, end in tears. In the interim, it has made the acquisition of any worthwhile project, of which there are very few, prohibitively expensive and incapable of being economically justified. The Company continues to move forward on a number of projects which will only be consummated if they display the risk reward profile required to generate the returns expected by the shareholders of the Company.

My hope is that the Company has repaid the loyalty, patience and financial commitment of its shareholders over the past eight years. The Company has, and will continue, to strive to do even better.

Mladen Ninkov
Chairman
16th May 2006

	2005 $000	2004 $000 Restated
Revenue	6,120	-
Cost of sales	(2,440)	-
Gross Profit	3,680	-
Net operating expenses	(3,254)	(1,557)
Profit / (loss) from operations	426	(1,557)
Foreign exchange (losses) / gains	(411)	939
Finance income	296	507
Profit / (loss) before tax	311	(111)
Income tax expense	-	-
Profit / (loss) after tax attributable to equity share owners for the financial year	311	(111)
Basic and diluted earnings / (loss) per share (cents)	0.17	(0.07)

	2005 $000	2004 $000 Restated
ASSETS
Non-current assets
Property, plant and equipment	27,070	16,894
Intangible assets – Exploration interests	419	39
	27,489	16,933
Current assets
Inventories	1,620	-
Other current assets	947	276
Available-for-sale financial assets	63	27
Cash and cash equivalents	6.663	12,985
	9,293	13,288
Total assets	36,782	30,221
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital	1,838	1,773
Share premium	39,040	36,594
Contributing surplus	3,690	3,690
Share based payments	842	509
Investment revaluation reserve	-	-
Foreign exchange reserve	215	(143)
Profit and loss reserve	(12,740)	(13,087)
Total equity	32,885	29,336
Non-current liabilities
Long-term provisions	372	-
Current liabilities
Trade and other payables	3,525	885
Total liabilities	3,897	885
Total equities and liabilities	36,782	30,221
Number of shares in issue	183,827,731	177,327,731
Attributable net asset value / total equity per share	$0.18	$0.17

	Share capital	Share Premium	Contri- buting surplus	Share based payments	Investment revaluation reserve	Foreign Exchange Reserve	Profit and loss	Total
	$000	$000	$000	$000	$000	$000	$000	$000
At 31 December 2003	1,352	21,385	3,690	-	(811)	(121)	(12,130)	13,365
Exchange differences on translating foreign operations	-	-	-	-	-	(22)	-	(22)
Loss for the year	-	-	-	-	-	-	(111)	(111)
Movement in fair value of financial assets							(35)	(35)
Issue of share capital	421	15,209	-	-	-	-	-	15,630
Cost of share based payments	-	-	-	509	-	-	-	509
Transfer	-	-	-	-	811	-	(811)	-
At 31 December 2004	1,773	36,594	3,690	509	-	(143)	(13,087)	29,336
Exchange differences on translating foreign operations	-	-	-	-	-	358	-	358
Profit for the year	-	-	-	-	-	-	311	311
Movement in fair value of financial assets							36	36
Issue of share capital	65	2,446	-	-	-	-	-	2,511
Cost of share based payments	-	-	-	333	-	-	-	333
At 31 December 2005	1,838	39,040	3,690	842	-	215	(12,740)	32,885

	2005 $000	2004 $000 Restated
Net cash flows from operating activities
Profit/(loss) before taxation	311	(111)
Foreign exchange losses	360	93
Finance income	(296)	(507)
Adjustment in respect of share options	333	509
Depreciation, depletion and amortisation	557	5
Increase in inventories	(1,620)
(Increase) in other current assets	(671)	(177)
Increase in trade and other payables	2,640	799
Net cash inflow from operating activities	1,614	611
Cash flows from investing activities
Interest received	296	507
Payments to acquire intangible fixed assets	(376)	(557)
Payments to acquire tangible fixed assets – mineral interests	(6,949)	(5,082)
Payments to acquire tangible fixed assets – plant and equipment	(3,409)	(4,938)
Payments to acquire tangible fixed assets – other	(9)	(17)
Net cash (outflow) from investing activities	(10,447)	(10,087)
Cash flows from financing activities
Issue of ordinary share capital	2,511	16,391
Expenses paid in connection with share issue	-	(761)
	2,511	15,630
Increase/(decrease) in cash and cash equivalents	(6,322)	6,154

Notes:

• 1. This statement has been prepared using accounting policies and presentation consistent with those applied in the preparation of the statutory accounts of the Company.
• 2. The summary accounts set out above do not constitute statutory accounts as defined by Section 84 of the Bermuda Companies Act 1981 or Section 240 of the UK Companies Act 1985. The summarised consolidated balance sheet at 31 December 2005 and the summarised consolidated income statement, consolidated statement of changes in equity and the summarised consolidated cash flow statement for the year then ended have been extracted from the Group’s 2005 statutory financial statements upon which the auditors’ opinion is unqualified. The results for the year ended 31 December 2004 have been extracted from the statutory accounts for that period, which contain an unqualified auditors’ report.
• 3. Griffin has applied International Financial Reporting Standards (IFRS) to its 2005 accounts in full. The adoption of revised IFRS2, covering share based payments, has resulted in a charge to profit in 2005 of $333,000 and an adjustment to the 2004 results for a charge to profit and loss of $509,000. The adoption of revised International Accounting Standard 39 covering financial instruments has resulted in gains of $36,000 (2004 losses $35,000) being recognised in respect of the Company’s marketable securities held for investment being taken to equity.
• 4. The annual report and accounts for 2005 together with the notice of the Annual General Meeting to be held on 16 June 2006 are being sent by post to all registered shareholders. Additional copies of the annual report and accounts are available from the Company’s London office, 6th Floor, 60 St James’s Street, London, SW1A 1LE.
• 5. The calculation of the basic earnings/(loss) per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the year. The calculation of diluted earnings per share is based on the basic earnings per share on the assumed conversion of all dilutive options and other dilutive potential ordinary shares. Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below: