Highlights

Higher US dollar prices and increased sales volumes for all products
Headline earnings increased by 118,3% to R651,6 million
Interim dividend increased from 150 cents to 250 cents per share

COMMENTARY

Headline earnings for the six months to 31 December 2007 have increased by 118,3% to R651,6 million due to the significant increase in the earnings of Assmang Limited (Assmang) further benefiting from the increased commission earned on the sales of group products.Assore holds a 50% interest in Assmang which is proportionately consolidated in accordance with International Financial Reporting Standards (IFRS).

Assmang’s headline earnings increased by 118,2% to R1 146,4 million compared to the same period of the previous year due to increased sales volumes for all products as indicated in the table below and significantly higher US dollar prices in particular for manganese ores and alloys. Markets for all products remained strong throughout the period with prices and volumes driven by increased production of carbon and stainless steels worldwide, particularly in China.

SALES VOLUMES

Assmang’s turnover for the period under review reached a record level of R4,4 billion (2006: R2,6 billion) and sales volumes for all products were also at record levels as reflected in the table below:


Metric tons ‘000	2007	2006	% change
Iron Ore	3 286	2 783	+18,1
Manganese ore *	1 434	1 046	+37,1
Manganese alloys *	122	109	+11,9
Charge chrome	115	107	+7,5
Chrome ore *	116	69	+68,1

* Excluding intra-group sales

CAPITAL EXPENDITURE

The bulk of the group’s capital expenditure occurs in Assmang, which amounted to R1 583,5 million (2006: R656,8 million) during the period under review. Of this R1 307,0 million was spent on the construction of the first phase of the new Khumani Iron Ore mine (Khumani) and R51,9 million on a furnace rebuild at Assmang’s Cato Ridge Works ferromanganese smelter.

Run of mine production for commissioning purposes has commenced at Khumani and final production build-up is expected to commence in April 2008 reaching full capacity of 10 million sales tons per annum by July 2009. The project is expected to be completed on time and within the budget of R4,2 billion. Further expansion to increase capacity to 20 million tons per annum is under investigation but will depend largely on the successful conclusion of negotiations with Transnet on increasing the capacity of the Sishen Saldanha railway line and port facilities. The Khumani project has been funded mainly from internally generated cash flow together with bank facilities established at the Assmang level.

Discussions are also under way with Transnet with regard to expanding the capacity of the Port Elizabeth Dry Bulk Terminal and the associated railway line from the mines in the Northern Cape. Assmang uses the terminal for the export of manganese ore but is currently also exporting additional volumes through the ports of Durban and Richards Bay.

OUTLOOK

Prices and volumes for all the group’s products are at all time record levels. Term contracts for manganese ore commencing April 2008 are about to be renewed and US dollar prices in the spot market have increased by over 300% on the previously agreed contract price. This increase will support substantially higher prices for manganese alloys for at least the remainder of the calendar year.

Sales volumes of iron ore will rise as additional capacity becomes available at Khumani and contract prices for the year commencing
April 2008 are expected to increase by approximately 70%.

The demand for ferrochrome and chrome ore remains strong and international market prices have increased accordingly.

Production at both the mines and works could be negatively affected by the interruptions to power supply which are being experienced in South Africa at present and the US dollar and Euro exchange rates will continue to be an important factor in the determination of earnings for the remainder of the financial year.

DIVIDENDS

The results in the announcement include the final dividend relating to the previous financial year of 200 cents (2006: 150 cents) per share which was declared on 29 August 2007 and paid to shareholders on 25 September 2007. Based on the increased earnings for the period the board has declared an interim dividend of 250 cents (2006: 150 cents) per share which will be paid to shareholders on or about
17 March 2008. In accordance with generally accepted accounting practice this interim dividend is not included in the results for the period under review as it was declared after 31 December 2007.

ACCOUNTING POLICIES AND BASIS OF PREPARATION

The financial statements have been prepared on the historical cost basis, except for financial instruments that are fairly valued, in accordance with IAS 34 – Interim Reporting, issued by the International Accounting Standards Board and incorporate the accounting policies which are consistent with those adopted in the financial year ended 30 June 2007, with the exception of the adoption of the following policies in response to changes in IFRS:

IFRS 4 – Insurance contracts
IFRS 7 – Financial instruments – disclosure
IAS 1 – Presentation of financial statements
IFRIC 11 – Scope of IFRS 2 – Share-based payments

The adoption of these amendments, standards and interpretations has had no effect on the financial statements of the group except for the disclosure of additional information.

DECLARATION OF InTerim DIVIDEND

Interim dividend No. 102 of 250 cents per share was declared on 18 February 2008, in the currency of the Republic of South Africa. In accordance with STRATE, the following dates apply to the dividend declared:

The last date to trade to qualify for the dividend (and for changes of address or dividend instructions) will be Friday, 7 March 2008.

The company’s ordinary shares will commence trading “ex” dividend from the commencement of business on Monday, 10 March 2008.

The record date will be Friday, 14 March 2008.

Dividend cheques in payment of this dividend to holders of certificated shares will be posted on or about Monday, 17 March 2008. Electronic payment to holders of certificated shares will be undertaken simultaneously.

Holders of dematerialised shares will have their accounts at their Central Securities Depository Participant or broker credited on Monday,
17 March 2008.

Share certificates may not be dematerialised or rematerialised between Monday, 10 March 2008 and Friday, 14 March 2008, both days inclusive.

On behalf of the board

Desmond Sacco	C J Cory
Chairman	Chief Executive Officer

Johannesburg
21 February 2008



Registered office	Transfer office	Directors
Assore House	Computershare Investor	Executive
15 Fricker Road	Services 2004 (Pty) Ltd	Desmond Sacco (Chairman)
IIlovo Boulevard	70 Marshall Street	R J Carpenter (Deputy Chairman)
Johannesburg 2196	Johannesburg 2001	C J Cory (Chief Executive Officer)
		P C Crous (Technical and Operations)
Company secretaries		Non-executive
African Mining and		P N Boynton
Trust Company Limited		B M Hawksworth
		M C Ramaphosa
		Dr J C van der Horst
Assore Limited		Alternate
Company registration number: 1950/037394/06		J W Lewis (British)
Share code: ASR ISIN: ZAE000017117		NG Sacco
		P E Sacco
		R Smith