Trans-Siberian Gold plc - files.q4europe.com

RNS Number : 0933BTrans-Siberian Gold PLC08 June 2021

8 June 2021Trans-Siberian Gold plc

("TSG", the "Company", or the "Group")Final Audited Results

Trans-Siberian Gold plc (TSG.LN), a low cost, high grade gold producer in Kamchatka, Russia,is pleased to announce its audited financial results for the year ended 31 December 2020. Financial Highlights:

· Record-breaking revenues of $81.0 mil l ion, up 28.3% (2019: $63.1 mil l ion)· EBITDA of $42.7 mil l ion, up 61.7% (2019: $26.4 mil l ion)· Profit Before Tax of $28.0 mil l ion up 122.6% (2019: $12.6 mil l ion) · Total dividend pay-out for the year of $9 mil l ion (2019: $8.5 mil l ion)

Operational Highlights:

· Record annual production of gold in dore at 45,066 oz. a 3.7% increase YoY (2019:43,479 oz.)

· Total cash cost per oz. gold sold of $536 (2019: $513)· All-in Sustaining Costs per oz. gold $863 (2019: $941)· Cost of sales per oz. of gold at $876 (2019: $878)

A copy of the Company's Annual Report and Financial Statements is available on theCompany's website: www.trans-siberiangold.com

ENDS Contacts: TSGStewart Dickson

+44 (0) 7799 694195

Canaccord Genuity Limited(Nominated Adviser & Joint CorporateBroker)Henry Fitzgerald-O'Connor / James Asensio

+44 (0) 20 7523 8000

Panmure Gordon (UK) Limited(Joint Corporate Broker)John Prior / Hugh Rich / Ailsa MacMaster

+44 (0) 20 7886 2500

Hudson Sandler(Financial Public Relations)Charlie Jack / Katerina Parker / Elfie Kent

+44 (0) 207 796 4133

About TSGTSG is focused on low cost, high grade mining operations and stable gold production from its100% owned Asacha Gold Mine in Far East Russia. The Group also holds the l icence for thedevelopment and exploration of the Rodnikova deposit, one of the largest gold fields in SouthKamchatka.Additional information is available from the Company's website: www.trans-siberiangold.comMarket Abuse RegulationsThe information contained within this announcement is deemed by the Company to constitute

http://www.trans-siberiangold.com

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inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'),this inside information is now considered to be in the public domain.DisclaimerThis announcement contains "forward-looking statements" - that is, statements related tofuture, not past, events. In this context, forward-looking statements often address ourexpected future business and financial performance, and often contain words such as"expects," "anticipates," " intends," "plans," "believes," "seeks," "should" or "wil l ."Forward-looking statements by their nature address matters that are, to different degrees,uncertain. For us, uncertainties arise from the behaviour of financial and metals markets,fluctuations in interest and/or exchange rates and metal prices; and from numerous othermatters of national, regional and global scale, including those of a political, economic,business, competitive or regulatory nature. These uncertainties may cause our actual futureresults to be materially different that those expressed in our forward-looking statements.

Trans-Siberian Gold

Annual Report & Financial Statements 2020

Low cost, high grade gold producer

Low cost, high grade mining operations and stable gold production from the AsachaGold Mine in Far East Russia.

Financial Highlights

Profit before tax

$28.0m+122.6%

(2019: $12.6m)

Revenue

$81.0m+28.3%

(2019: $63.1m)

EBITDA

$42.7m+61.7%

(2019: $26.4m)

Gold in doré

45,066oz+3.7%

(2019: 43,479oz)

• Total dividend payout during FY20 of $9.0 million (2019: $8.5 million).

Operating HighlightsRecord year of gold production

• Gold in doré 45,066 oz. (2019: 43,479 oz.), silver in doré 78,875 oz. (2019: 111,557 oz.).

• Cost of sales per oz. of gold, net of silver credits, $876 (2019: $878).

• Total Cash Cost per oz. gold sold $536 (2019: $513)*.

• AISC per oz. gold sold $863 (2019: $941)*.

* Refer to note 36 Non-GAAP Measures.

Introduction

At a GlanceTrans-Siberian Gold plc ('TSG', the 'Company' or the 'Group') is a UK-based resources company, established in2000 and listed on the AIM market of the London Stock Exchange.

TSG's 100%-owned subsidiary, JSC TSG Asacha ('TSG Asacha) (having changed its name from AO TrevozhnoyeZarevo on 21 April 2021) holds a 24 square kilometre licence in the southern part of the Kamchatka peninsula, andis the operator of the Asacha Gold Mine. In April 2019, AO Trevozhnoye Zarevo was issued a licence for thedevelopment and explorat ion of the Rodnikova deposit , one of the largest gold fields in South Kamchatka, for atenure of 20 years.

Focused on low cost, high grade mining operations and stable gold production

The 100% owner of the Asacha Gold Mine in Russia

A highly-regarded management team with significant experience in developing and operating gold mines inRussia

Committed to maintaining our licence to operate through acting responsibly in relat ion to our people, theenvironment and the communit ies which we interact with

Key Strengths:

Strong Institutional Shareholders

Low Cost Gold Producer

Attractive Dividend

Financial Robustness

Growth Opportunities

Experienced Board

Favourable Mining Jurisdiction

Asacha Gold MineAn epithermal gold/s ilver deposit located on a tertiary volcanic arc typical of ore systems found along the Pacific Rim. The main orezone at Asacha consists of five steeply dipping veins with two principal veins averaging over two metres in width. Veins arecharacterised by low sulphidation quartz-adularia occurring predominately in dacite domes.

Established gold mine in Far East Russia

High grade underground operation

Gold in doré production: 45,066oz. for FY20

Low Cash Cost operation: $536/oz.

Chairman's StatementI am pleased to present the Group's Annual Report and FinancialStatements for the year ended 31 December 2020, a significant year forTrans-Siberian Gold.

Gold in doré

45,066oz+3.7%

(2019: 43,479oz)

EBITDA

$42.7m+61.7%

(2019: $26.4m)

Providing sustainable return to shareholders

"A record year of production and financial performance"

I am very proud of the achievements delivered by the Company thisyear.Executing our strategy2020 was a year of s ignificant achievement for Trans-Siberian Gold as we continued to enhance and realise value from ouroperations in the Far East of Russia.

We continued to improve our operational performance and, in spite of unprecedented challenges presented by COVID-19, deliveredsignificant shareholder returns.

COVID-19Throughout the ongoing COVID-19 pandemic, the Company's first priority at all times naturally remained the safety and wellbeing ofits employees.

From the outset, we focused on implementing strict measures to ensure the safety of our employees and our contractors, andproactive measures remain in place today.

Whilst there was no material impact to TSG's production from the COVID-19 virus during the period, we introduced thorough riskmitigation structures, and closely followed all government advice. TSG remains vigilant to the risks that the pandemic poses andcontinues to implement strict measures to ensure the safety of our employees and contractors and to maintain strong preparednessfor potential further outbreaks of infection.

Operations and Financial PerformanceIn the ninth full year of our operations at the Asacha mine we achieved our highest ever revenue of $81.0 million, building on our

successes from 2019 (revenue: $63.1 million). This was ass isted by a very supportive gold price environment as the averagerealised price of gold sold in 2020 was $1,808/oz, a 29.2% increase from $1,399 oz in 2019.

In 2020, Trans-Siberian Gold continued to return capital to shareholders by paying an interim dividend of $7 million. Due to thetakeover offer described below, the Board is unable to recommend a final dividend for FY 2020.

At our flagship Asacha Gold Mine, 2020 saw a continuation of the favourable grades mined in 2019. Consistent good gradeperformance, coupled with sustained high recoveries throughout the year, resulted in 45,066 oz of gold dore produced in 2020,beating our expectations and exceeding market guidance. Improved gold production was supported by a very favourable gold pricethroughout 2020 and as a result I am pleased to report a s ignificant increase in profitability.

2020 saw a transition from the Main Zone to the East Zone of the Asacha Gold Mine, as we commenced mining activities at the high-grade Vein 25. Vein 25 presented increasingly promis ing grades over the year, as demonstrated by the highest quarterly gold gradeof 10.3 g/t achieved during Q4 2020.

The Group continued with exploration drilling near-mine and proximal step-out targets in the vicinity of the Asacha Gold Mine.Additionally, an aeromagnetic survey was completed over the Asacha licence area with the objective of identifying new explorationtargets.

In February 2020 we confirmed the quality of the Rodnikova gold deposit in South Kamchatka with the issuance of a JORC-compliantmineral resource estimate, and initiated the Scoping Study for the project, which we were pleased to publish in February 2021,reporting a resource of 6.3Mt at an average grade of 5.0 g/t, for a total of 1Moz contained gold. The Company believes that Rodnikovacontinues to have additional upside potential which merits exploration and studies.

On 6 January 2021, the Company regretfully reported a tragic accident due to a rock fall at Asacha's Vein 25, resulting in two fatalities.Following the incident, we continue to support the families affected by the accident, and worked closely with Rostekhnadzor (theFederal Service for the Supervis ion of Environment, Technology and Nuclear Management) in its investigations, following which weallocated substantial resources to enhancing ground support both at Vein 25 and at the Main Zone.

Gold industry trendsGold was one of the best performing major asset classes of 2020.

Increasing by 25% year on year, the gold price reached an all-time high of $2,067.15/oz. in early August 2020. Sustained growth inglobal gold-backed ETF holdings, which grew by 877.1t over the year, was largely as a result of market uncertainty over the COVID-19pandemic and fiscal reactions and responses from authorities worldwide.

Takeover OfferAfter the 2020 financial year-end, on 18 March 2021, the Company announced an agreement with Horvik Limited ("Horvik") on theterms of a recommended pre-conditional mandatory cash offer ("Offer") to be made by Horvik for the Company's ordinary shares notalready held or agreed to be acquired by Horvik (the Announcement). The Announcement included the rationale for the Company'sIndependent Directors ' recommendation of the Offer which, for ease of reference, I outline below.

• The Selling Shareholders, which comprise the Company's former Chairman, Charles Ryan and a former non-executive director,Florian Fenner, together with connected entities and various funds managed by UFG Asset Management Limited ("UFG"), whocollectively owned over 50 per cent. of the share capital of TSG (excluding any shares held in treasury) had agreed to the sale oftheir entire shareholdings in TSG at £1.18 per share (the "Offer Price").

• UFG has been a long-term and supportive shareholder of TSG with certain persons or entities within the group of SellingShareholders having been TSG Shareholders s ince 2006.

• Whilst UFG has reduced its shareholding over recent years, which has aided liquidity in the trading of TSG shares, the TSGIndependent Directors understand that the Selling Shareholders have been looking at opportunities to monetise the value of theirentire holding in TSG for a period of time and have concluded that the Offer represents the most appealing way of realis ing valueat an attractive price.

• The TSG Independent Directors recognise this desire and that the Selling Shareholders may have moved from the investing stageto the realisation stage of their investment life-cycle. Alternative methods of the Selling Shareholders seeking to realise valuefrom their TSG shareholdings in the near term would likely have a detrimental impact on the market price of TSG Shares pendingand, in particular, during such monetisation.

• The TSG Independent Directors believe that, given the Company has a single production asset and all itsoperations are based in the Kamchatka region in Far East Russia, there is a relat ively limited number of potentialalternative buyers for the Company that could provide similar opportunit ies for a full cash monetisat ion for TSGshareholders in the near term. The Offer represents a liquidity opportunity for all TSG shareholders to realisetheir investment in TSG in full, in cash, and on the same terms as the Selling Shareholders.

• The outlook for gold is uncertain, with market consensus on the long-term price of gold being materially belowthat of the current spot price. The TSG Independent Directors believe that the Offer Price represents fair valueon the basis of their commercial assessments of TSG.

• The TSG Independent Directors believe the long term prospects of the Asacha Gold mine remain attract ive.However, delivery of TSG's strategy to grow production has execution risk, including customary permitt ingrequirements, and would require further material capital expenditures.

• In this context, the TSG Independent Directors believe that the Offer Price recognises the prospects andexecution risks of TSG, whilst providing certainty, in cash, to TSG shareholders now.

In addit ion, the Announcement also noted that:

• There can be no guarantee that similar future liquidity events will materialise;

• TSG's share price has only traded higher than the Offer Price for 32 trading days in the last 15 years, reachingits 15 year peak in September 2019;

• Mining operations are inherently risky and susceptible to interruption as evidenced by the recent andregrettable incident at TSG's Asacha Gold Mine; and

• TSG's development asset, Rodnikova, is not due for development for some t ime and it is currently est imatedthat it would require approximately $130 million of capital expenditure. Accordingly, TSG would likely have toraise a combination of further debt and equity if it were to develop this asset. The TSG Independent Directorsacknowledge that there is no certainty that UFG would part icipate in further investment in TSG.

• The Offer Price represents a premium of approximately:

- 18 per cent. to the closing price per TSG share of £1.00 on 17 March 2021 (being the last pract icable date priorto the date of the Announcement);

- 34 per cent. to the closing price per TSG share of £0.88 on 4 March 2021 (being the last business day prior tothe date on which Horvik first approached the TSG Independent Directors); and

- 26 per cent. to the volume weighted average closing price per TSG share of £0.94 for the one month periodended on 17 March 2021 (being the last pract icable date prior to the date of the Announcement).

• As the Selling Shareholders' holdings represent greater than 50 per cent. of the share capital of TSG(excluding any shares held in treasury), if the FAS Pre-Condit ion is sat isfied, control of TSG will have passed fromthe Selling Shareholders to Horvik.

• If, through acceptances of the Offer, Horvik acquires interests which, together with the TSG Shares it acquirespursuant to the SPA, amount to at least 75 per cent. of the share capital of TSG, Horvik will seek to cancel theadmission of the TSG Shares to trading on AIM, which, if such cancellat ion occurs, will mean there is no liquidmarket in which to trade TSG shares.

• If Horvik fails to acquire interests in at least 75 per cent. of the share capital of TSG, Horvik intends to retainthe Company's list ing on AIM. Pursuant to the Relat ionship Agreement described in the Announcement, Horvikwill be entit led to appoint three directors and therefore, subject to the provisions of the Relat ionshipAgreement, will have significant influence over the strategic direct ion and priorit ies of the Company, includingany future dividend payments and may have a different perspective on these matters to other shareholders.

On 19 May 2021, Horvik announced that the Russian Federal Antimonopoly Service ("FAS") had granted regulatoryclearance in connection with the Offer. Accordingly, the pre-condit ion to the Offer has been satisfied and anoffer document containing the terms of the Offer will be posted to TSG Shareholders as soon as practicable andin any event within 28 days of that announcement.

I would like to take this opportunity to express my heartfelt thanks to all our employees. In a very uncertain year,throughout the prolonged risk of COVID-19, ensuring the health and wellbeing of our people remained our firstpriority. Amid a global pandemic, our excellent financial and operational performance is a direct consequence oftheir skills and dedication; it is much appreciated.

Lou Naumovski

Interim Chairman and Senior Independent Non-Executive Director

"Providing sustainable return to shareholders"

Strategic report

StrategyThe Directors present the Strategic Report for the year ended 31 December 2020.

StrategyThe Group seeks to provide investors with access to a company capable of generating industry-leading shareholder returns, whilemaintaining a commitment to operational excellence and its social and environmental responsibilities. The Group's current corporatestrategy is based on the following three pillars:

01.Enhance exist ing operations

02.Utilise stable platform for future growth opportunit ies

03.Pursue select ive accretive M&A opportunit ies

Proven track record of gold production

Principal activities Trans-Siberian Gold plc is a UK-based resources company, whose Asacha Gold Mine in the Far East of the Russian Federation hasbeen in production s ince September 2011.

The Company is a public limited company, operating under the laws of England and Wales (the principal legis lation being theCompanies Act 2006), incorporated and registered in England and Wales with registered number 1067991 and domiciled in the UnitedKingdom.

TSG is committed to creating value for all stakeholders on a sustainable basis . For shareholders, value is derived from capitalappreciation in the Company's share price and distributions in the form of dividends and share buybacks. Value is created bysupporting Russia's Far East economy through taxes paid, employment and investment in communities.

How we deliver our strategy & create valueThe Group makes use of various inputs and assets in our business activities to create shareholder value. Our business is focusedon low-cost gold production and enabling investments. The outputs represent the delivery of our business strategy.

Operating and Financial ReviewContinuous improvement in operational performance

In 2020, the ninth full year of its operations, Asacha produced 45,066ozof gold doré.TSG is focused on low cost, high-grade mining operations and stable gold production from its 100% ownedAsacha Gold Mine in Kamchatka, Far East Russia. The Group also holds the licence for the development andexplorat ion of the Rodnikova Gold Deposit , est imated to be one of the largest goldfields in Kamchatka.

Asacha Gold Mine

Production

In 2020, the ninth full year of its operations, Asacha achieved an all-t ime record annual production of 45,066oz. ofgold in doré (2019: 43,479 oz.) and 78,875 oz. of silver in doré (2019: 111,557 oz).

The average processed ore gold grade in 2020 was 7.7 g/t, in line with the 2019 average 7.8 g/t. The grade of gold has improvedduring the year, resulting in the highest quarterly grade of 10.32 g/t in Q4 2020. The quality and consistency of ore from Vein 25made a s ignificant contribution to delivering these operational achievements.

As indicated for some time, 2020 was a year of transition from the Main Zone to the East Zone of the Asacha Gold Mine, whichcontains s ignificantly higher grade ore.

Mine production in Q1 2020 was relatively low as mineralisation in the Main Zone becomes lower in grade and more erratic at depth.This vertical zonation is typical of epithermal systems. Lower grade stoping ore was required to be blended with existing stockpiledore, which resulted in a lower average mill feed grade.

The second quarter of 2020 saw a return to substantially higher average gold grades as the Company began to process high-gradeore extracted from Vein 25 in the East Zone, with considerable progress in mine development works at Vein 25. This continued intoQ3 and Q4 2020, with average mill-feed gold grades supported in part by test ore extracted from Vein 25, and leading the group toupgrade initial production guidance.

Mining operations at Vein 25 were suspended for a short period following a rock fall accident on 6 January 2021, and resumed on 5March 2021, once full permitting approvals were granted.

Ore processing at the Asacha plant involves:

• two-stage grinding with semi-autogenous grinding at the first stage, ball milling at the second stage, pulp class ification inhydrocyclones by 0.75mm size and hydrocyclones' s lurry thickening in a high-capacity thickener;

• cyanidation and carbon-in-leach process;• e lectric e lution of loaded carbon by basic solutions under pressure using IPS technology, acid treatment and thermal regeneration

of carbon;• melting of cathode deposits into doré alloy; and• cyanide destruction of s lurry tailings by chlorination and storing of neutralised tailings as diluted s lurry.

Mining and production at Asacha in 2020 is shown in the following table:

20 20 2019 Yo Y

Mine development metres 4,547 7,239 -37.2%

Ore extracted tonnes ('000) 170 142 +19.5%

Ore processed tonnes ('000) 196 179 +9.4%

Average feed gold grade g/t 7.7 7.8 -1.5%

Average feed silver grade g/t 16.2 23.4 -30.8%

Gold recovery rate % 94.2 95.3 -1.1%

Silver recovery rate % 78.4 81.5 -3.8%

Gold in doré oz. 45,066 43,479 +3.6%

Silver in doré oz. 78,875 111,557 -29.3%

Gold refined oz. 43,837 43,733 +0.2%

Silver refined oz. 80,673 109,851 -26.6%

Employees and safetyAt 31 December 2020 TSG's subsidiary TSG Asacha employed 579 staff, including personnel working in two shifts at the s ite (2019:604 people).

The Group reported one non-operational fatality and 7 light injuries in 2020 (2019: 7 light injuries, zero fatalities). Efforts to improvethe health and safety at Asacha continue as the Group continues to invest in employee training and development, such as labour andfire safety, accident response and emergency management, safety and the safety of hydro-technical facilities. After the period end,on 6 January 2021, the Company regretfully reported a tragic accident due to a rock fall at Asacha's Vein 25, resulting in two fatalities.A full investigation was commenced and operations were immediately suspended following this event. On 5 March 2021, theCompany announced it had been granted full permitting approvals to resume mining operations at Vein 25 in the East Zone of theAsacha Gold Mine.

COVID-19The Group focused on implementing measures to ensure the safety of our employees and contractors, the integrity of ouroperational facilities and to prepare the business to face emerging challenges. Consequently, operations saw limited directinterruption from the COVID-19 pandemic.

We are proud to be a s ignificant employer in the Kamchatka region of the Far East of Russia. The health and wellbeing of all ouremployees remains our utmost priority, and we are closely monitoring the development of this global health cris is and its potentialimpact on our people and operations. We have risk mitigation policies in place aimed at communicating the best precautionarymeasures to our staff to prevent the spread of the virus. All personnel go through 14-day quarantine before entering the mine s ite.We follow the latest government advice in all our jurisdictions with regard to the current running of our operations.

Reserves and ResourcesAs at 31 December 2020, the total mineral resource estimate for Asacha (Measured, Indicated and Inferred), as reported on 16March 2021, in accordance with the JORC Code (2012) was 645,000 oz of contained gold.

The Mineral Resource Estimate ('MRE') for the Asacha Gold Mine was updated by SRK Consulting Russia Ltd ('SRK') with an effectivedate of 31 December 2020 and is available on the Company's website. The resource estimate was updated to incorporate new dataavailable from exploration drilling and mining development, and to account for mining depletion.

The results of 99 drillholes for 30,524m and 1,338 channel samples over 3,034m were added to the database s ince the previousresource estimation. The modelling approach and parameters used by SRK for the new MRE model were generally s imilar to theapproach and parameters used for preparing the previous MRE.

The resource at Asacha occurs in two zones: Main and East zone (both of which are currently being mined).

The Main zone hosts s ix defined veins, with the majority of the resource contained in two of these, QV1 and QV2. Three veins havebeen defined in the separate East zone of which QV25 is most s ignificant. The Main zone has a strike length of approximately 1500m,whilst the V25 South and V25 North in the East zone, which have resources defined over a total of approximately 800m.

Infill and extension drilling of Vein 25 North has also defined two minor domains (V25 North B and D), approximately paralle l and to theeast of the main mineralisation.

Asacha JORC mineral resource - 31 December 2020

Class ificatio n Zo ne To nne s Au g/t Ag g/t Au (ko z ) Ag (ko z ) Au (kg) Ag (kg)

Measured Main 136,000 13 44 58 194 1,800 6,000

Measured V25S 14,000 41 49 19 22 600 700

Measured T otal 150,000 16 45 76 216 2,400 6,700

Indicated Main 100,000 11 44 35 142 1,100 4,400

Indicated North 54,000 11 19 20 32 600 1,000

Indicated V25N 486,000 19 107 291 1,672 9,100 52,000

Indicated V25S 27,000 31 44 27 38 800 1,200

Indicated V7 V8 38,000 25 58 30 70 900 2,200

Indicated T otal 704,000 18 86 403 1,955 12,500 60,800

Measured andIndicated T otal 862,000 17 79 479 2,171 14,900 67,500

Inferred Main 21,000 8 36 6 25 200 800

Inferred V25N 122,000 14 119 54 468 1,700 14,600

Inferred V25S 88,000 14 53 41 149 1,300 4,600

Inferred V7 V8 101,000 20 37 66 120 2,000 3,700

Inferred T otal 333,000 16 71 166 762 5,200 23,700

• Resources are reported above 4m*g/t Au cut-off grade

• Resources are reported after mining deplet ion

• Tonnage and grades have been rounded to reflect an appropriate level of precision

• Rounding may mean that columns do not sum exactly

• Mineral Resources are classified according to the definit ions of the JORC Code

• The updated Mineral Resource Est imate was prepared by Mr Robin Simpson, a full-t ime employee of SRKConsult ing (Russia) Ltd, as a Principal Consultant (Resource Geology).

• Mr Simpson is a Member of the Australian Inst itute of Geoscientists (AIG), and has sufficient experiencerelevant to the style of mineralisat ion and type of deposit under consideration and to the act ivity which he isundertaking to qualify as a Competent Person as defined by the 2012 edit ion of the "Australasian Code forReport ing of Explorat ion Results, Mineral Resources and Ore Reserves" (JORC Code). Accordingly, Mr. Simpson is aCompetent Person as defined by the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009.

Sources of change between 2019 and 2020 resource est imates

Main Zone

The previous Mineral Resource Est imate for the Main Zone had a total of 89,000 oz in Measured and Inferred.Although mining deplet ion in the last eight months of 2020 is est imated to have removed 25,000 t of in situmineralisat ion, at 11 g/t for 9,000 oz Au, after this deplet ion the Main Zone Measured and Indicated in the newestimate now contains 93,000 oz of Au. The increase has occurred because the new channel samples included inthe update are, on average, higher grade than the block est imates in the corresponding areas of the previousmodel.

Reconciliat ion information from 2020 provides confidence that the grades of the channel samples can be reliedon for Mineral Resource est imation.

None of the new core drilling information affects the Mineral Resource est imate for the Main Zone.

East Zone Vein 25 North

From this est imation update, the major increase to the Asacha Mineral Resources comes from the extension ofthe main Vein 25 North domain up to 100m down dip, and up to 200m along strike to the north.

The wireframe interpretat ion of this domain omits some intersections that were included in the interpretat ionVein 25 North for the previous est imate. Although these intersections have been interpreted as thecontinuation of the same Vein 25 North mineralised vein, the omitted intersections occur at the edge of thestructure, and as clusters with average Au grades consistently less than the nominal 4 g/t modelling threshold. Inthe new model, SRK trimmed these low grade edges from the est imation domain.

The new drilling shows a 150m gap in the Vein 25 North mineralisat ion, from approximately 55570N to 55720N.North of this gap, SRK modelled a mineralised domain (V25 North E) based on four holes from TSG's twonorthernmost lines of dri‑ lling. Therefore, potential remains for Vein 25 to continue northward along strike.

The infill and extension drilling of Vein 25 North has also defined two minor domains (V25 North B and D),approximately parallel and to the east of the main mineralisat ion. These secondary domains were not modelledas part of the previous Mineral Resource est imate.

Explorat ion

In 2020, the Group continued to conduct explorat ion drilling. Vein 25 remains open at depth and to the north,while its southern extension has not yet been drilled.

TSG has identified new potential explorat ion targets at and near the Asacha deposit based on the geophysicalanomalies identified in the course of an aeromagnetic survey completed in Q4 2020.

The low sulfidation epithermal style of mineralisat ion found at the Asacha Gold Mine is favourable for high-gradedeposits. The Asacha licence area and more widely, the regional district , remain under-explored which theCompany believes presents an opportunity to increase gold resources. As such, the Company has reinvested inits explorat ion act ivit ies.

Rodnikova

On 23 April 2019, the Russian Federal Agency for Subsoil Use ("Rosnedra") issued a 20-year licence to AOTrevozhnoye Zarevo for the development and explorat ion of Rodnikova. The acquisit ion cost of the deposit was$3 million. Taking into consideration the fact that the Asacha and Rodnikova deposits are believed to have similargeology and mineralogy, the Company will determine the suitability of ut ilising the exist ing processingtechniques and plant at Asacha for the ore at Rodnikova.

Mineral Resource Est imate for Rodnikova

On 10 February 2020, TSG published a JORC compliant MRE for the Rodnikova Gold Deposit produced by SRK

Consult ing (Russia) Ltd for the Company's wholly owned subsidiary, AO Trevozhnoye Zarevo. The MRE wasdeveloped in accordance with the recommendations and guidelines of the Australasian Code for Report ing ofExplorat ion Results, Mineral Resources and Ore Reserves as published by the Joint Ore Reserves Committee ofthe Australasian Inst itute of Mining and Metallurgy, Australian Inst itute of Geoscientists and Minerals Council ofAustralia (the JORC Code, 2012 Edit ion).

The MRE confirmed Total Indicated & Inferred Resources of 6.3Mt at a grade of 5g/t of gold, for total contained+1Moz of gold, of which Indicated Mineral Resources of 3.1Mt at a grade of 5.3g/t gold, for contained 519,000ozgold and Inferred Mineral Resources of 3.2Mt at a grade of 4.8g/t gold, for contained 491,100oz gold. In addit ion,the MRE confirmed Total Indicated & Inferred Resources of 6.3Mt at a grade of 36.79 g/t of silver, for totalcontained 7.4Moz of silver. SRK's full report is available on the Company's website at: www.trans-siberiangold.com

Scoping Study

In February 2021, TSG announced the results of an independent Scoping Study for the 100% owned RodnikovaProject in Kamchatka, Far East Russia prepared by SRK Consult ing (Russia) Ltd ("SRK"), based on Indicated &Inferred Mineral Resources, reported in accordance with the JORC Code (2012), of 6.3 Mt at an average grade of5.0 g/t gold, for a total of 1Moz contained gold.

The Scoping Study has identified economically viable development options which just ifies the advancement ofthe project. The Company believes that the project continues to have addit ional upside potential which it hadplanned to evaluate through addit ional explorat ion and studies.

Location

The Rodnikova Gold Deposit is located in the south-eastern part of the Kamchatka Peninsula, in the SouthKamchatka ore region, in the Yelizovo administrat ive district of the Kamchatka Region. There is a 120km roadfrom Petropavlovsk-Kamchatsky to the Rodnikova Gold Deposit , including 65km of asphalt road. The RodnikovaGold Deposit is approximately 61 km from the Company's operating Asacha Gold Mine.

Previous Explorat ion

The main explorat ion works on the Rodnikova Gold Deposit and its flanks included reconnaissance explorat ion,diamond drilling (223 drill-holes for 47,377m), core sampling, development of two adit levels totalling 822m, with acollect ion of channel and chip samples, excavation of trenches to trace vein continuity along the strike andchannel sampling. The main explorat ion stages on the deposit were completed in the 1980-1990s. Addit ionaldrilling within the Rodnikovy mineralised zone and at its flanks was undertaken as part of the 2005-2007explorat ion program.

The main explorat ion reports, drawings and primary field documentation for the Rodnikova Gold Deposit are keptin the regional archives of the Ministry of Natural Resources. SRK is of the opinion that explorat ion works weregenerally performed at the level to meet the state standards of the Soviet Union and Russia, and thesestandards are appropriate for collect ing information to be used for Mineral Resource est imation.

The database used to construct the resource model contains information on 223 drill-holes, 332 trenches, 440clearings and 83 cross-cuts, 15,027 core samples and 12,060 channel samples.

Rodnikova Gold Deposit JORC mineral resource - 10 February 2020

Class ificatio n To nne s (Mt) Au (g/t) Au (t) Au ('000o z ) Ag (g/t) Ag (t) Ag (Mo z )

Rodnikovy Indicated 3.1 5.3 16.1 519 43.9 134.9 4.3

Inferred 1.7 4.3 7.4 238 32.3 55.7 1.8

Vilyuchinsky Inferred 1.5 5.3 7.9 253 27.1 39.9 1.3

T otal Indicated 3.1 5.3 16.1 519 43.9 134.9 4.3

T otal Inferred 3.2 4.8 15.3 491 29.9 95.7 3.1

Notes:

• Mineral Resources are reported in accordance with guidelines and provisions of the JORC Code.

• Mineral Resources were est imated at a cut-off grade of 3.0 g/t within underground mining outlines.

• The Competent Person for this report of Mineral Resources is Mr Robin Simpson, an employee of SRKConsult ing (Russia) Ltd. Mr Simpson is a Member of the Australian Inst itute of Geoscientists (AIG), and hassufficient experience relevant to the style of mineralisat ion and type of deposit under consideration and to theactivity undertaken to qualify as a Competent Person.

Scoping Study Highlights

http://www.trans-siberiangold.com

Production Potential

• Life of mine ("LOM") 14 years

• LOM is based on a Mineral Resource Est imate, reported in accordance with the JORC Code (2012), of 6.3 Mt atan average grade of 5.0 g/t gold

• LOM gold production of 517,000 oz. at an average grade of 4.03 g/t

• LOM silver production of 3,062,000 oz. at an average grade of 28.9 g/t

• Sub-level stoping and underground mining methods assessed to be optimal for the Project

• Conventional CIL processing plant with processing capacity of 500 kt per annum

• Gold recovery 94%

• Cut-off grade of 3.5 g/t , calculated based on $1,250/oz gold price assumption

• Production schedule does not include any potential future explorat ion success and Mineral Resource growth

Project Costs & Economics1

• LOM Revenue of $715m

• LOM Free Cash Flow of $126m

• LOM CAPEX $133m of which $82m is init ial/construction CAPEX in year 1

• Economics at LOM gold price of $1,600/oz (Management sensit ivity)

- Including applicat ion of TOR2:

- Post Tax NPV10% of $177.6m

- Post Tax Internal Rate of Return of 59.2%

- Excluding applicat ion of TOR


- Post Tax Internal Rate of Return of 40%

• Economics at LOM gold price of $1,300/oz (SRK base case)

- Including applicat ion of TOR:


- Post Tax Internal Rate of Return of 35.3%

- Excluding applicat ion of TOR


- Post Tax Internal Rate of Return of 22%

• Discounted Payback period of 4 years applying TOR, or maximum of 6 years excluding TOR

Socio-economic contribution

• It is anticipated that, should the project advance, as a major employer in the Kamchatka region the projectwould create approximately 800 employment opportunit ies and generate significant tax remittances to regionaland federal governments.

1. Scoping Study Project economics were prepared by SRK using an LOM gold price of $1,300/oz. Sensit ivit ies togold price were calculated by management to evaluate different Project economics.

2. Advanced Special Economic Zones ("ASEZ") have been created in the Far East of Russia under a "Territory ofAdvanced Development" (also known as "TOR"), a special regime of treatment of foreign investors who injectfunds and capabilit ies to Russia's Far East, whereby those foreign investors are provided with certain incentivesand benefits. In part icular, there are reductions to corporate profits tax, value added tax, land tax, mineralextract ion tax and social insurance payments. On 19 December 2019, the Company confirmed that its operatingsubsidiary had been confirmed as resident of ASEZ Kamchatka. The Company will apply for the Project to betreated under the TOR regime in due course.

RodnikovyGold mineralisat ion at the Rodnikova deposit is mainly associated with hydrothermal-metasomatic formations.

The Rodnikovy vein zone is localised in a N-S trending disjunctive fault . The fault thickness is 50-120m, theestimated length is 3km. The fault zone hosts veins: 42, 43, 44, 52 and 53 which are accompanied by apophysesand numerous quartz veinlets. The main plane of the ore-controlling fault is occupied by Vein 44 which is adjoinedat various angles from the side of the hanging wall by the remaining veins that form the main branching structureof tensile fracturing.

The main veins are Veins 43 and 44 which contain 80% of the mineralisat ion of the Rodnikovy vein zone. Themaximum thickness of the ore body is 23m and is observed on the 220m level. Gold grade ranges from tenths ofa gram per ton to 90-130g/t, with most samples showing grades within a 4-70g/t range.

Mineralisat ion at the Rodnikova deposit is a typical quartz low-sulphidation gold and silver. Gold and associatedsilver are the only valuable ore components of significance. The main vein minerals are: quartz (42.5-75%),adularia (9.5-16%) and carbonate (5-28.6%). Diagnostic leach data shows that most of the gold in analysed ore(88.7%) is amenable to cyanidation (in the presence of a sorbent). Associated silver is mostly present in acyanide-amenable form (82.2%).

VilyuchinskyThe Vilyuchinsky site is located in the north-western part of the ore field, 4 km from the Rodnikovy site, on thewatershed of the Bystraya-Paratunka and Vilyucha rivers.

Two systems of ore-controlling faults (sub-meridional and north-eastern) were identified within the site. Ofmajor importance is the system of the N-E trending disjunctive faults that form the Vilyuchinsky ore-bearing veinzone of 400-500m wide traced over some 3km. Productive mineralisat ion is mainly confined to shallow veins thatform tensile fractures (Vein 9). Vein 9 has an average thickness of 2.9m, a strike length of 450m and a dip lengthof 90m. The average gold grade is 9.82g/t, silver grade is 67.83g/t. 80% of mineralisat ion at Vilyuchinsky isconcentrated within Veins 9, Regina, 6 and 13. Cost of sale decreased to $40.1 million (2019: $40.3 million).

Financial ReviewThe Group generated all-t ime record revenue during 2020.

Revenue from the sale of 43,884 oz. gold (2019: 43,782 oz.) was $79.3 million (2019: $61.3 million), and of 80,330oz. of silver (2019: 115,801 oz.) was $1.6 million (2019: $1.9 million).

Average realised prices were $1,808 per oz. gold and $20.4 per oz. silver (2019: $1,399 per oz. gold and $16.0 peroz. silver). All sales were made on spot basis.

Cost of sales decreased to $40.1 million (2019: $40.3 million).

Cash cost per oz. gold, was $536 (2019: $513). All-In Sustaining Costs ('AISC') per oz. gold were $863 (2019:$941), as discussed in note 36 in the financial statements.

The Group recorded an operating profit for the year of $27.5 million (2019: $14.4 million).

Administrat ive expenses amounted to $10.2 million (2019: $8.8 million).

Finance income was $0.03 million (2019: $0.07 million). Finance costs were $1.8 million (2019: $1.6 million).

Financial Posit ion

Total equity was $91.1 million at 31 December 2020 compared to $78.2 million at 31 December 2019. Theincrease was mainly due to a significant increase in retained earnings.

Non-current assets decreased from $88.5 million to $83.4 million.

Current assets increased from $28.8 million to $43.6 million, the most significant item of which was cash and cashequivalents increasing from $8.7 million to $22.4 million.

Loans and borrowings reduced substantially from $25.1 million at 31 December 2019 to $15.1 million at 31December 2020, comprising $13.2 million of bank loans (2019: $22.9 million) and $2.0 million of equipment loans(2019: $2.2 million) described in note 23 to the financial statements.

Current liabilit ies at 31 December 2020 totalled $15.7 million (2019: $15.8 million).

As discussed in note 25 to the financial statements, the Group's gearing rat io at 31 December 2020 was (8.65%)(2019: 17.34%).

Management

OOO Trans-Siberian Gold Management, TSG's 100%-owned subsidiary in Moscow, provides managerial, technical,financial and procurement services to TSG Asacha and currently has 21 staff, including 2 technical managersbased at Asacha and TSG Asacha's Managing Director. TSG's Chief Executive Officer and Chief Operating Officerare based in Moscow.

Going concern

The Group's operations are cash generative and management t ightly control the level of committed expenditureto ensure that the Group has sufficient resources available to meet its liabilit ies as they fall due. Regular cashforecasts are reviewed to assess the potential impact of factors such as changes in commodity prices,production rates and the t iming of capital expenditure. The Group has reported an operating profit for the yearof $27.5 million, an operating cash inflow of $41.2 million and net increase in cash of $13.7 million. The Directorshave reviewed the Group's cash flow forecast for the period to 31 December 2022 and carried out mult iplescenario analysis of potential downsides including future lockdowns of various length; production, workforce andsupply chain disruptions together with reasonably possible changes in commodity prices; and scheduledrepayments of loan facilit ies. The Directors further stress tested combinations of various scenarios identifyingno significant cash concerns. Based on these analyses, the Directors believe that the Group has sufficientresources to continue in operational existence for the foreseeable future. Furthermore, the Directors haveconsidered the impact of Horvik's acquisit ion discussed in note 35 on the going concern of the Group. In formingtheir opinion the Directors have relied upon the public statements made by Horvik about its future intentions forthe Group, which outline its commercial and financial rat ionale for the acquisit ion. While the Directors are unableto provide surety that such intentions will be enacted, they are not aware of any planned actions which may castdoubt over the Group's future operational existence. The Directors have also considered the change of controlclause within the Company's credit facilit ies with VTB and are comfortable that this does not have an impact onthe going concern status of the Group in light of the Group's cash posit ion and the outstanding loan balance at31 December 2020 and for the reasons outlined in note 23 and note 35. Therefore the Directors believe that theGroup will continue as a going concern and have prepared the financial statements on that basis.

Events after the report ing date Takeover Offer

After the year-end, on 18 March 2021, the Company reached an agreement with Horvik Limited on the terms of arecommended pre-condit ional mandatory cash offer to be made by Horvik for the TSG ordinary shares notalready held or agreed to be acquired by Horvik.

Further information on Horvik and all documents relat ing to the Offer are available at: https://horviklimited.com

Alexander Dorogov

Chief Executive Officer

8 June 2021

Key Performance IndicatorsThe following charts set out the key performance indicatorsmonitored by TSG's Board of Directors:

KPI's are how we measure our progress of delivering our strategy.

Refined gold sales

43,884oz+0.2%

(2019: 43,782oz)

Average realised gold price

$1,808+29.2%

(2019: $1,399)

Cost of sales per oz. gold*

$876

https://horviklimited.com

-0.2%

(2019: $878)

Average dilut ion

48%+37.1%

(2019: 35%)

Average feed gold grade

7.7 g/t-1.5%

(2019: 7.8 g/t)

Gold recovery rate

94.2%-1.1%

(2019: 95.3%)

Net Cash**

$7.3m+156%

(2019: -$16.4m)

EBITDA

$42.7m+61.7%

(2019: $26.4m)

Cash cost per oz. gold

$536+4.5%

(2019: $513)

Ore extracted

170 tonnes ('000)+19.5%

(2019: 142 tonnes ('000))

Ore processed

196 tonnes ('000)+9.45%

(2019: 179 tonnes ('000))

Average employee numbers

608-13%

(2019: 699)

AISC per oz. gold

$863-8.3%

(2019: $941)

Reported injuries

7+/-0%

(2019: 7)

* Net o f s i lver credits** Net cash is ca lcula ted as cash and cash equiva lents less to ta l borrowings

A Responsible Corporate CitizenTrans-Siberian Gold is committed to a sustainable approach to responsible business and reiterates the ongoingcommitment to be a good corporate cit izen and a support ive and reliable partner for local communit ies.

We strive to contribute to the sustainable development of the remote region in which we operate and to createlong-last ing contributions to the economic, as well as the social prosperity of local residents.

Stakeholders around the world are increasingly looking to businesses to help address global developmentchallenges. The United Nations (UN) Sustainable Development Goals (SDGs) set out a framework which helpsbusinesses and their stakeholders better understand and address those challenges. In 2015 the UN memberstates adopted 17 SDGs for tackling poverty, protecting our planet and working towards sustained peace andprosperity.

Our business act ivity touches direct ly and indirect ly on many of the UN SDGs and we continue to look foropportunit ies to do more to support the SDGs.

Through our operations we are aligned to and direct ly contribute to the development of SDGs 1, 3 and 8, whichare support ing global efforts to reach no poverty, ensuring good health and wellbeing of our people and decentwork and economic growth. Addit ionally, we have also outlined SDGs of which we can support the delivery and onwhich we can have a posit ive impact as a smaller business; this includes goals 4, 6, 7, 9, 10, 12, 14, 15, 16.

How we contribute to the advancement of goals 1, 3 and 8:

Our operations are located in the remote, ecologically sensitive and under-developed region of Kamchatka, where Trans-SiberianGold provides s ignificant contribution to the achievement of the UN SDGs by promoting regional development through creatingopportunities for local res idents. We are a s ignificant local employer and taxpayer, employing 579 people in Petropavlovsk-Kamchatskiy and we are a valued member of the Advanced Special Economic Zone (ASEZ) providing important economic support tothe region.

People are at the heart of our business, and through our social act ivit ies we are committed to creating excellentworking and living condit ions for our employees, their families and the community in which we operate, therebyimproving the living standards and well-being of our people. Through our work in the region and by taking aproactive approach, we focus on making posit ive, sustainable contributions to the economic, as well as thesocial prosperity of the residents of South Kamchatka.

Goal 1: No Poverty• We invest in our people and in the regions in which we operate, providing attractive and inclus ive employment opportunities and

training.• We pay taxes and royalties on our earnings and publicly disclose all payments to governments.

Goal 3: Good Health and Well-being• We maintain a rigorous health and safety protocol and reporting practices. At our operations, we test for traces of substance

misuse and screen for symptoms of COVID-19 related illness.• We take serious steps to prevent toxic emiss ions that could negatively impact the health of our employees and local communities.• We encourage a healthy lifestyle among our employees and promote personal well-being.

Goal 8: Decent Work and Economic Growth• We provide skilled work and communicate employment opportunities locally, and contribute positively to the regional economy of

Kamchatka.• Our focus on local procurement, by ensuring we integrate local suppliers into our supply chains where possible, ensures the

economic development of the region.

How we support goals:

Through our operations, we want to contribute to the development of local communit ies, deliver long term valueto our employees, invest in local infrastructure, spur innovation and invest in environmental protection. We seekto ensure that our act ivit ies do not harm our employees, local communit ies or the environment. These SDGsinclude areas where we can have a posit ive impact in the region of presence as well as areas where we strive tomit igate any potential negative impacts.

Empowering our community

Goal 4: Quality EducationGoal 9: Industry, Innovation and InfrastructureGoal 10: Reduced Inequalit iesGoal 16: Peace, Justice and Strong Institutions• Trans-Siberian Gold is an equal opportunities employer and we provide attractive wages. We provide equitable access to

employment opportunities in our region.• We provide training to all our employees to refresh and upgrade their skills ; we are committed to developing our workforce and

providing employees with opportunity to progress within our Company. In addition to this , we pride ourselves as a local employerand provide skilled work in our region, contributing to the economic growth of Petropavlovsk-Kamchatskiy.

• We maintain an open and transparent approach to communicating with authorities on a local, federal and national level and strive toprevent all forms of conflict by ensuring clear channels of stakeholder engagement.

Goal 6: Clean Water and Sanitation Goal 7: Affordable and Clean EnergyGoal 12: Responsible Consumption and ProductionGoal 14: Life Below WaterGoal 15: Life on Land• We take our responsibility with regard to environmental stewardship very seriously. We carry out baseline and follow-up

environmental impact assessments to preserve the biodivers ity in the existing ecosystems surrounding our areas of operations,both above land and below water, and regularly provide monitoring data to the authorities.

• In addition, we make concerted efforts to conserve our water use, and ensure that waste is disposed of safely. Water life isincluded in our corporate impact assessments. We monitor water quality and provide monitoring data to the authorities.

• To minimise our waste production, we blend lower grade ore into our processing plant, and ensure that we dispose of our wastecarefully and responsibly.

• Our tailings storage facilities (TSFs) are maintained to high levels of safety and we provide disclosure on our TSF management(refer to RNS announcement on 20 August 2019).

• We monitor our fuel consumption closely and examine opportunities to reduce our energy consumption and thereby contribute to apotential reduction in emiss ions.

SECR StatementStreamlined Energy and Carbon Reporting (SECR)

This report summarises, in accordance with the UK Government requirements for SECR, the Group's est imatedgreenhouse gas emissions & energy use and the implementation of energy efficiency measures.

Greenhouse gas emission (See note 1)

In 2020 our total Global greenhouse gas (GHG) emissions including Scope 1&2 were 19,4 kilotonnes carbondioxide equivalent (ktCO2e).

This represents a 2% increase compared with 2019 and is due to an increase in metal (gold and silver) productionvolumes. But at the same t ime, the Intensity Ratio of emission per ton of processed ore decreased by 7%.

Emiss io n (Se e no te 2) Unit 20 20 2019

Emission from activities for which the Group owns or controls including of fuel andoperation of facilities. (Direct GHG emission - Scope 1)

tn CO2e 10,393 10,206

Emission from the purchase of electricity (Indirect GHG Emission - Scope 2) tn CO2e 8,959 8,050

T otal GHG Emission (Scope 1 + Scope 2) tn CO 2e 19,352 18,257

Inte ns ity Ratio Unit 20 20 2019

Ore processed tn 196,226 179,373

GHG emission per tn ore processed kg/tn 99 102

Fue l and Ene rgy co nsumptio n use d to calculate abo ve e miss io n Unit 20 20 2019

Fuel consumption used to calculate above emissions Diesel tn 3,204 3,163

Petrol tn 38 20

Electricity consumption MWh 38,427 34,530

Energy efficiency measures

The company strives for the careful use of natural resources. To reduce energy consumption, in 2020 a new HeatRecovery Unit was installed to recover heat from diesel generators. This measure is est imated to enable asaving of 5.7 MWh electricity per year, that equals 1.3 ktn CO2e emission reduction.

Notes

1) All emissions and energy consumption figures are attributed to The Group's wholly owned operationalsubsidiary TSG-Asacha. With the exception of TSG-Asacha, the Company and other subsidiaries of the Grouphad zero emissions in 2020.

2) In the absence of established factors to calculate GHG emissions for Russia, TSG used physical indicators forour consumption of various types of fuel, as well as the amount of electricity consumed from an externalsupplier and converted them into a volume of carbon dioxide emissions according to the UK GovernmentConversion Factors for greenhouse gas (GHG) report ing, provided by Department for Business Energy & IndustryStrategy separately for 2020 and 2019 years (https://www.gov.uk/government/collect ions/government-conversion-factors-for-company-report ing).

https://www.gov.uk/government/collections/government-conversion-factors-for-company-reporting

"Estimated saving of 5.7 MWh electricity per year"

Risk Review

A proactive and practical approach to managing risk

The risk management philosophy and tolerance levels of the Group is set and overseen by the Board. Risktolerance levels are aligned with Board-approved strategic object ives and adjusted according to changinginternal and external scenarios.

Risks are formally reviewed by the Board and appropriate processes put in place to monitor and mit igate them. Ifmore than one event occurs, the overall impact of such events may compound the possible adverse effects onthe Group.

Further details of how we engage with our stakeholders as a key part of managing risk and fostering posit iverelat ionships are set out in the Directors' Report.

Princ ipal Risk Nature o f RiskMo ve me ntin Risk Ho w we manage the risk Link to S trate gy

Regulat o ryenviro nment

• The Gro up's activitie s are subje ctto e xte ns ive Russ ian fe de ral andre gio nal laws and re gulatio ns .

• Le gal inco ns is te ncie s may arise invie w o f the le gal and re gulato ryre gime in Russ ia.

• Ame ndme nts to curre nt laws andre gulatio ns , o r mo re s tringe ntimple me ntatio n o r inte rpre tatio n o flaws and re gulatio ns , co uld have amate rial adve rse impact o n theGro up.

flat • Russ ia base d manage me nt te am havee xte ns ive e xpe rie nce .

• Mo nito ring changing le gis latio n toe nsure co mpliance .

• Outso urce d le gal, taxatio n and o the rfunctio ns to e nsure subje ct matte re xce lle nce .

• Cultivating go o d wo rking re latio nshipswith re gulato rs and with re pre se ntative so f the natio nal o r lo cal go ve rnme nt.

• Enhance e xis tingo pe ratio ns

• Utilise s tableplatfo rm fo rfuture gro wtho ppo rtunitie s

• Se le ctive lypursue accre tiveM&Ao ppo rtunitie s

Mininglegislat io n &licensing

• The Gro up is de pe nde nt upo n thegrant and re ne wal o f appro priatelice nce s , pe rmits and re gulato ryco nse nts .

• Failure to co mply with the se co uldre sult in additio nal co s ts , pe naltie sbe ing le vie d o r the suspe ns io n o rre vo catio n o f the lice nce .

flat • Mo nito ring changing le gis latio n toe nsure co mpliance .

• D iscuss io ns are he ld with theappro priate autho ritie s .

• Po lic ie s , s tandards and pro ce dure s inplace to e nsure co mpliance .

• Re gular co mpliance re vie w by advise rs .• Re gis te r o f all mining title s .• Asacha mining lice nce re ne we d in June

2018 fo r pe rio d o f 6 ye ars .• Ro dniko va e xplo ratio n lice nce awarde d

in April 2019 fo r pe rio d o f 20 ye ars .



Reserve andreso urceest imat es

• Es timate s may re quire re vis io nbase d o n actual pro ductio ne xpe rie nce .

• Vo lume and grade o f re se rve smine d and pro ce sse d and re co ve ryrate s achie ve d may vary fro m tho seantic ipate d.

• Go ld price may re nde r re se rve sco ntaining re lative ly lo we r grade s o fgo ld mine ralisatio n une co no mic.

do wn • The Gro up e s timate s its mine ralre so urce s base d o n info rmatio nco mpile d by Co mpe te nt Pe rso ns inacco rdance with JORC.

• Co nduct de taile d ge o lo gical mo de llingand e nsure that all analyse s o fe xplo ratio n sample s are unde rtake n byaccre dite d labo rato rie s .

• Thro ugh re -appraisal o f mine ralre so urce s and audit o f assumptio ns inMine ral Re so urce Es timate co nducte d inco njunctio n with co mpe te nt pe rso nsduring the ye ar.



Enviro nment allegislat io n &co mpliance

• Use o f vario us che micals andco ntaminants inc luding cyanide , aresubje ct to e xte ns ive e nviro nme ntaland he alth and safe ty laws andre gulatio ns .

• Change s in re gulatio ns , o r theinte rpre tatio n o f re gulatio ns , mayre sult in additio nal co s ts .

flat • The Gro up mo nito rs co mpliance with there le vant le gis latio n and re gulatio ns andse e ks to e nsure that the Russ iane nviro nme ntal autho ritie s are satis fie dwith the Gro up's co mpliance withapplicable e nviro nme ntal laws andre gulatio ns .

• Co mpliance with wate r-use lice nceguide line s .

• Po llutio n co ntro l and wate r catchme ntdams .

• Co ntro l o f to xic mate rials in co ntaine ds to rage are as .

• Co ntinuo us e ngage me nt with andre vie ws by re gulato rs o n co mpliance .


Healt h & Saf et y • Subje ct to vario us e nviro nme ntal,he alth and safe ty re gulatio nss tipulate d by the re le vant re gulato ryage ncie s .

• The Gro up's o pe ratio ns re quirevario us lice nce s /pe rmiss io ns withre gard to the o pe ratio n o fflammable , e xplo s ive and che micallyaggre ss ive pro ductio n fac ilitie s andthe use o f hazardo us s tructure s .

• S tricte r re gulatio ns co uld causethe Gro up to incur additio nal co s tsin o rde r to co mply with the ne wdire ctive s .

flat • Manage me nt pro mo te co mpre he ns ivesafe wo rking practice s .

• The Gro up also o rganise s safe ty trainingfo r e mplo ye e s .

• Le gal co mpliance , s tandards andpro ce dure s in place , and re gular auditsco nducte d.

• Ongo ing e xaminatio n o f wo rkplaceco nditio ns .

• Se nio r and e xpe rie nce d safe tymanage rs at o pe ratio ns .

• Inde pe nde nt o ve rs ight by re gulato rs .


Mining andpro cessing

• Explo ratio n risks inc lude ge o lo gicaland ge o te chnical facto rs .

up • Te chnical and o pe ratio nal manage me nthave e xte ns ive e xpe rie nce fro m o the r


• Pro ductio n risks inc lude o regrade /quality, to nnage s andre co ve ry/yie lds .

• Pro ce ss ing risks inc lude indus trialand me chanical inc ide nts , te chnicalfailure s , labo ur dispute s , fire ,flo o ding and o the r acts o f Go d.

• S ignificant se ismic activity inKamchatka.

• Climatic co nditio ns may impact thede live ry o f supplie s , e quipme nt andfue l.

Russ ian mining pro je cts .• Ope ratio nal audits are unde rtake n by

e xte rnal e xpe rts .• All buildings and ins tallatio ns at the

Asacha mine have be e n de s igne d andco ns tructe d to withs tand se ismicactivity.

• Lo gis tical arrange me nts allo w fo rwe athe r dis ruptio n.

• Ore grade s mine d fro m the Main Zo nedid de cre ase in Q4 2019 and Q1 2020 asthe o re bo dy ge ts mo re e rratic at de pth.This is e xpe cte d to be mitigate d byhighe r grade o re fro m the Eas t Zo ne .

Pro pert y andBusinessint errupt io ninsurance

• Unable to arrange co mpre he ns ivepro pe rty and bus ine ss inte rruptio ninsurance fo r the Asacha mine at anacce ptable co s t.

• No guarante e that o pe ratio ns atAsacha will no t be dis rupte d bypro pe rty damage o r o the rinte rruptio n.

flat • All buildings and ins tallatio ns at theAsacha mine have be e n de s igne d andco ns tructe d to withs tand se ismic activityand s ignificant wate r ingre ss aris ing fro mme lting sno w.

• Lo gis tical arrange me nts allo w fo rwe athe r dis ruptio n.

• Risk has be e n discusse d with theCo mpany's majo r share ho lde rs .

• Unde rgro und wate r pumping s tatio n hasbe e n co mmiss io ne d.


Go ld pricevo lat ilit y

• Go ld price is affe cte d by nume ro usfacto rs which are be yo nd theGro up's co ntro l.

• Influe ncing facto rs inc lude wo rldpro ductio n le ve ls , glo bal andre gio nal e co no mic and po liticale ve nts , inflatio n, curre ncy e xchangefluctuatio ns , indus trial and je we lle ryde mand, spe culative activity and thepo litical and e co no mic co nditio ns o fmajo r go ld-pro ducing co untrie s .

flat • Fo cus o n pro ductio n co s ts to maximisemargins and re main a lo w-co s t pro duce r.

• The Gro up asse sse s the e co no micviability o f its pro je cts at go ld price sbase d o n lo ng te rm tre nds andfo re cas ts .

• The Gro up te s ts its financial mo de ls fo rse ns itivity to the go ld price .

• The Gro up do e s no t curre ntly ho ld anyfinancial ins trume nts to he dge the go ldprice o n its e xpe cte d future pro ductio nand ke e ps this unde r re vie w.



T axat io n • Tax le gis latio n has be e n subje ct tochange .

• The go ve rnme nt's imple me ntatio no f such le gis latio n, and the co urts 'inte rpre tatio n the re o f, has be e nso me time s uncle ar, with fe wpre ce de nts e s tablishe d.

• D iffe ring le gal inte rpre tatio ns maye xis t bo th amo ng and withingo ve rnme nt minis trie s ando rganisatio ns and lo calinspe cto rate s .

• The intro ductio n o f ne w taxpro vis io ns may affe ct the Gro up'so ve rall tax e ffic ie ncy and may re sultin s ignificant additio nal tax liability.

flat • The Russ ia base d manage me nt te amhave e xte ns ive e xpe rie nce to e nsure fullco mpliance with the Tax Co de and time lyimple me ntatio n o f le gis lative change s .

• Outso urce d taxatio n functio n to e nsuresubje ct matte r e xce lle nce .



• Se le ctive lypursue accre tiveM&Ao ppo rtunitie s

COVID-19 • Glo bal he alth pande mic.• Safe ty o f o ur e mplo ye e s and

co ntracto rs .• Po te ntial impacts are curre ntly

unkno wn but co uld inc ludepro ductio n dis ruptio n due togo ve rnme nt re s trictio ns , impacts o no ur wo rkfo rce and supply chaindis ruptio n. S ituatio n is co ntinuallychanging.

flat • Intro duce d pre cautio nary me asure s topro te ct o ur s taff to pre ve nt the spre ado f the virus .

• We co ntinue to fo llo w the late s tgo ve rnme nt advice with re gard to thecurre nt running o f o ur o pe ratio ns .

• Ope ratio nal s taff are quarantine d andte s te d prio r to shift change s and trave lto mine -s ite

• Office -base d s taff are wo rking fro mho me .



Governance

Board of DirectorsA highly experienced leadership team with significant expertise inRussia.ExecutiveAlexander Dorogov (aged 51)Chief Executive OfficerAlexander Dorogov graduated from the State Finance Academy in Moscow with a degree in financial management. Prior to joiningTrans-Siberian Gold Management LLC in November 2008, he was Chief Financial Officer of the Alumina divis ion of UC Rusal from 2005to 2008. From 2009 till 2014 he also held the positions of deputy CEO and CFO of the Ferroalloys divis ion of Mechel. Between 2001and 2005 he held various senior positions with a private investment fund, supervis ing the acquis ition of gold mines in Siberia and FarEast Russia, and previously spent five years with United Financial Group.

Eugene Antonov (aged 46)Chief Operating OfficerEugene Antonov has more than 20 years of experience in the mining industry, mainly in managerial positions with responsibility formine s ite operations and finance. Most recently he was an integral part of the leadership team at the Kupol Mine in Far East Russiawhich generated the largest annual cash flow and achieved the lowest operating cost across Kinross Gold Corporation.

Between 1999 and 2007, he was employed at Bema Gold Corporation in Canada in various executive finance roles, including Directorof Finance, until its acquis ition by Kinross. His previous experience also includes managerial positions at Teck in Canada.

Mr. Antonov, is a graduate of Pace Univers ity in New York and holds a MBA awarded by the Rotman School of Management in Toronto.Mr Antonov is also a member of the Chartered Profess ional Accountants in Canada.

Non-ExecutiveLou Naumovski (aged 64)Lou Naumovski has more than three decades of experience working in Russia, most recently as Vice President and General Directorof the Moscow office for Kinross Gold Corporation, the largest Canadian investor in Russia. He also developed the business of VisaInternational, serving as Senior Vice President and General Manager Visa International Service Organisation (VISA), CEMEA region.Additionally, he served as Senior Banker and Head of Miss ion for the Russian Team of the European Bank of Reconstruction andDevelopment in Moscow, and he represented the Bank when the Russian Prime Minister's Foreign Investment Advisory Council wasfirst founded. Mr. Naumovski has a BA (Honours) in Economics and Political Science from the Univers ity of Toronto and an MA inInternational Relations (specialised in Russian/Soviet affairs) from the Norman Patterson School of International Affairs at CarletonUnivers ity in Ottawa.

Stewart Dickson (aged 43)Stewart Dickson has s ignificant corporate and commercial experience across the natural resources and financial services sectors. Hecurrently also serves as Chief Executive Officer of ASX listed Variscan Mines Limited and consults to the leadership teams of anumber of companies globally. His prior appointment was as Managing Director and Head of Metals & Mining at Cantor FitzgeraldEurope in London, with responsibility for client coverage of public and private mining companies across precious metals and basemetals , bulks, fertilizers and specialty metals . He has a broad range of experience advis ing small and mid-s ized quoted companiesat Board level on financial advisory, corporate strategy, equity capital markets, financings, M&A, corporate governance and regulatorycompliance. Prior to investment banking, Mr. Dickson served in the British Army. He is a graduate of Univers ity College London andholds a MBA from Henley Business School.

Directors who served during FY2020 and resigned on 26 May pursuant to the Takeover Offer

Charles Ryan (aged 54)Charles Ryan is a graduate of Harvard Univers ity. He was an Associate and Principal Banker with the European Bank forReconstruction and Development in London, before becoming a founder director of UFG. After UFG sold its investment bankingbusiness to Deutsche Bank in 2006, he spent two years as Chief Country Officer and Chief Executive Officer of Deutsche Bank inRussia, stepping down in October 2008 to become Chairman of UFG Asset Management. He is also a general partner with AlmazCapital and a director of PGI Group plc, Yandex N.V., Limitless Mobile Limited, Preferred Sands, Acumatica and serves on the HarvardGlobal Advisory Council and Capital International Inc. Advisory Board.

Robert Sasson (aged 56)Robert Sasson graduated from Exeter Univers ity with a degree in Russian Studies and International Government. He worked forPhibro Salomon before serving as the head of the St Petersburg office of the European Bank for Reconstruction and Developmentfrom 1993. Prior to joining UFG Asset Management in 2009, he spent three years with a leading US hedge fund on private equitytransactions in Russia and Ukraine.

Florian Fenner (aged 50)Florian Fenner joined UFG Asset Management as Managing Partner in July 2002. In addition to his role as Managing Partner, Mr. Fenneris also responsible for the overall management of UFG's public markets funds business. Prior to joining UFG, from 2000 to 2002 hewas the Head of Unifund's Moscow office with responsibility for its Russia portfolio. From 1996, Mr. Fenner served as the Deputy Headof Research at Brunswick Brokerage, one of Russia's leading investment banks and in 1997 he became the Russian Equity PortfolioManager for Brunswick Capital Management. Before joining Brunswick Brokerage, he worked as an investment banker for SchroderMunchmeyer Hengst Co. in Frankfurt. Mr. Fenner is a CFA charterholder and holds a degree in banking from Industrie- undHandelskammer in Frankfurt-am-Main.

Corporate Governance Review

Continuous improvement and transparency in the practicaldevelopment of fit-for-purpose corporate governancestructures.

Chairman's Statement

TSG is committed to transparency and high standards of corporate governance and recognises that itcontributes to the success of the Company.

The Board applies the Quoted Companies Alliance Corporate Governance Code (the 'QCA Code'). The QuotedCompanies Alliance ('QCA') is the membership organisation which represents the interests of small and mid-sizequoted companies. Further information about the QCA and copies of the QCA Code are available at:www.theqca.com. The QCA Code is constructed around ten broad principles. We are pleased to provide anexplanation as to how the Group meets and applies the principles in practice.

Due to the Takeover offer and pursuant to the SPA, changes to the Board have occurred, which is customary insuch circumstances and for a transaction of this nature. Further details are set out below.

How our governance supports the delivery of our strategy

All Directors are collect ively responsible for the success of the Group.

As the Chairman of the Company, I am responsible for the leadership of the Board. The Chairman acts in anadvisory capacity to the Chief Executive Officer ('CEO') and to other Directors on all matters concerning theinterests and management of the Company and, in coordination with the CEO, may play a role in the Company'sexternal relat ionships.

The Non-Executive Directors exercise judgment in respect of Board decisions, and provide constructivechallenge to executive management and scrutinise the delivery of the Group's strategy, which continues toprovide shareholders with attract ive returns.

The Board is responsible for sett ing strategy and policies, overseeing risk and corporate governance, andmonitoring progress towards meeting our object ives and annual plans. It is accountable to shareholders for theproper conduct of the business and our long-term success, and represents the interests of all stakeholders. TheBoard conducts an annual review of the Group's strategy.

The Senior Executive Team ('SET') takes the lead in developing the strategy which is then reviewed,constructively challenged and approved by the Board.

We are always mindful of the trust shareholders place in us as your elected Directors and of our widerresponsibilit ies to all of TSG's stakeholders.

Lou Naumovski

Interim Chairman & Senior Independent Non-Executive Director

8 June 2021

Strategy

Our strategic priorit ies

The Group seeks to provide investors with access to a company capable of generating industry-leadingshareholder returns, while maintaining a commitment to operational excellence and its social and environmentalresponsibilit ies.

The Group's current corporate strategy is set out in the Strategic Report, together with an explanation of howwe deliver strategy (our business model) and how we measure our progress (our Key Performance Indicators).

Risks

The management of the Group's business and the execution of its strategy are subject to a number of risks.Risks are formally reviewed by the Board and appropriate processes put in place to monitor and mit igate them.This enables us to meet the expectations of our shareholders and stakeholders.

The key operating risks affect ing the Group, most of which are those typically faced by other companies in thegold mining sector, are set out in the Strategic Report.

Board Composit ion

As at the date of this statement, the Board comprised an Interim Non-Executive Chairman, two ExecutiveDirectors and another Non-Executive Director. Two addit ional Non-Executive Directors are expected to join theBoard having been nominated by Horvik Limited which has announced a recommended mandatory offer for theCompany.

Leadership and Operation of the Board

Leadership & Responsibilit ies

In line with best practice, the roles of CEO and Chairman have been, and will continue to be separated with a cleardivision of responsibilit ies between them.

Lou Naumovski, is the Interim Chairman following the Board changes pursuant to the offer. He is currentlyresponsible for leadership of the Board and ensuring its effect iveness and ensuring that the Board operates inthe interests of the shareholders and other stakeholders.

Our CEO, Alexander Dorogov, leads the SET and has executive responsibility for running our business.

The composit ion of the Board has changed recently to reflect the Offer and may be subject to further changes.

Non-Executive Directors have a responsibility to uphold high standards of integrity and probity and are requiredto have a strong command of the issues relevant to the business in order to make a posit ive contribution to theBoard. Non-Executive Directors support the Chairman and the Executive Directors in inst illing the appropriateculture and values.

Chairman• Leader of the Board• Responsible for effective communication flow between Directors• Facilitates effective contribution from all Directors• Responsible for effective Board governance

• Ensures effective communication with shareholders

Execut ive Directors• Lead and motivate the management team• Implement strategy and objectives as directed by the Board• Develop Group policies and proposals for approval by the Board and ensure effective implementation

Non-Execut ive Directors• Supply challenge and support to management• Bring independent mind-set and differing backgrounds and experience to Board debates• Provide leadership and challenge on the Board Committees• Scrutinise the leadership of the Chairman

Company Secretary• Secretary to the Board and its Committees• Informs the Board on all matters reserved to it and ensures papers are provided in sufficient detail and on time• Available to Directors in respect of Board procedures and provides support and advice• Ensures the Board is kept informed on governance matters

The Board discharges its responsibilit ies through a programme of meetings that includes regular reviews offinancial performance and business crit ical issues. All Non-Executive Directors are required to ensure that thereis sufficient consideration of business issues prior to, and informed debate and challenge at, Board meetings. Inmaking decisions, they take into account the views of shareholders and other stakeholders, given that suchviews may provide different perspectives on the Company and its performance.

The Board also aims to ensure that a good dialogue with our shareholders is maintained and that their issues andconcerns are understood and considered. Until recently, the Company's largest shareholder, UFG AssetManagement ('UFG'), was represented on the Board by Charles Ryan, Robert Sasson and Florian Fenner (togetherthe 'UFG Representative Directors').

In accordance with the Company's adoption of the QCA Corporate Governance Code, the Board has consideredand adopted the recommendation to put in place a relat ionship agreement with its major shareholders. On 28November 2019, a Relat ionship Agreement was signed between the Company and certain entit ies of UFG. TheRelat ionship Agreement with UFG was terminated on 26 May 2021, in connection with the Offer and inaccordance with the Share Purchase Agreement between Horvik and the Selling Shareholders as described in anannouncement made on 18 March 2021.

On 18 March 2021, Horvik and TSG entered into a relat ionship agreement to ensure, among other things, thatTSG carries on its business independently of Horvik (the "Horvik Relat ionship Agreement").

Reserved matters

There is a schedule of matters that the Board has specifically reserved for its decision. This schedule is reviewedduring each financial year and includes matters such as sett ing the Group's strategic aims and object ives,appointment and termination of any Director, approving significant contractual commitments, approving changesto the Group's share capital and corporate structure, approving financial reports and ensuring the maintenanceof a sound system of internal control and risk management.

The matters that have not been expressly reserved to the Board are delegated by the Board to its Committeesor the CEO.

Operation of the Board

The Board held 17 meetings in FY 2020. In addit ion, the Board's Audit Committee and Remuneration Committeeeach held 2 meetings.

Board Meeting Attendance for the FY20

Dire cto r Bo ard Me e tings Audit Co mmitte e Me e tingsRe mune ratio n Co mmitte e

Me e tings

Charles Ryan* 17(17) 1(2) 2(2)

Alexander Dorogov 17(17) - -

Eugene Antonov 17(17) - -

Robert Sasson* 17(17) 2(2) 2(2)

Florian Fenner* 17(17) - -

Lou Naumovski 17(17) - 2(2)

Stewart Dickson 16(16) 2(2) -

No te s :Numbe r in bracke ts de no te s numbe r o f me e tings during the pe rio d that Bo ard me mbe rs we re e ntitle d to atte nd.

* re s igne d with e ffe ct fro m 26 May 2021

Formal agenda, briefing papers and reports are sent to the Board in advance of its meetings. As part of thebusiness of each board meeting, the CEO typically submits a progress report, giving details of businessperformance and progress against the object ives the Board has approved. To ensure that the Board has goodvisibility of the key operating decisions of the business, members of the SET may be invited to part icipate inBoard meetings and meet with Board members throughout the year. The Board also receives managementinformation and presentations on industry and regulatory developments from internal and externalsubject matter experts.

Principal matters considered by the Board in FY20

Area of focus

Strategic matters• The Group's overall strategy, including its long-range plan and budgets• The Group's capital structure, financing and strategy• Corporate development opportunities• Dividend declarationsOperat ional matters• Executive management reports , including business performance• Quarterly production information and announcements• Health & Safety (notably increased as a result of the fatalities in January 2021)

Stakeholders• Environment & Sustainability• Communities

Governance & Risk management• Reports from Board Committees• Succession planning for SET and Board-level roles• Financial and regulatory reporting

Board Committees for FY20

The Board delegates certain of its responsibilit ies to two Board Committees, which have clearly defined termsof reference as described below.

Audit Committee

The Audit Committee currently comprising Stewart Dickson (chairman) and Lou Naumovski (until 26 May 2021chaired by Charles Ryan, the other members being Robert Sasson and Stewart Dickson), meets at least twice ayear and is responsible for ensuring that the appropriate financial report ing procedures are properly maintainedand reported on and for meeting the auditors and reviewing their reports relat ing to the financial statementsand internal control systems. It is also responsible for monitoring the independence of the auditors. ExecutiveDirectors may attend meetings of the Audit Committee by invitat ion; however, at least once a year theCommittee meets the auditors without Executive Directors being present.

Principal matters considered by the Audit Committee in FY20

• Financial and regulatory report ing

• Object ivity and independence of the Company's auditor

Remuneration Committee

The Remuneration Committee currently comprising Lou Naumovski (chairman) and Stewart Dickson (until 26 May2021, chaired by Charles Ryan, the other members being Robert Sasson and Lou Naumovski), is responsible forreviewing the performance of the Executive Directors and other Senior Executives and for determiningappropriate levels of their remuneration, in consultat ion with external advisers as appropriate, with due regard tothe interests of shareholders. It meets as required. The committee also makes recommendations to the Boardin respect of employee incentives, including the granting of share options.

The Company's remuneration policy is to provide competit ive rewards for its Executive Directors and othersenior managers, taking into account the performance of the Company and condit ions prevailing in the

employment market for executives of equivalent status, both in terms of the level of responsibility of theirposit ion and their achievement of recognised job qualificat ions and skills. Base salaries are reviewed annually.Details of Directors' remuneration are disclosed in note 8 to the financial statements.

It is the Company's policy that Executive Directors' service contracts have no fixed term and that the noticeperiod in those service contracts does not exceed one year. Alexander Dorogov's and Eugene Antonov's servicecontracts provide that either party may terminate their employment by giving six months' written notice andthat the Company may make a payment in lieu of notice.

Principal matters considered by the Remuneration Committee in FY20

• Determination and review of levels of remuneration

• Sett ing annual bonus targets

• Board appointments

• Termination arrangements for leavers

Further details relat ing to the remuneration of the Board is set out in note 9 of the Financial Statements.

Board Committees Post Period End

A committee of TSG directors, all of whom are independent for the purposes of the Offer from Horvik Limited,was formed to consider and manage the conduct of the Offer. The committee comprises Lou Naumovski(chairman), Stewart Dickson, Alexander Dorogov and Eugene Antonov.

Due to Offer result ing in the resignation of the UFG Representative Directors, Board committees have been re-configured as described above.

Board effect iveness

Appointments to the Board and succession planning

Due to the size and scale of its operations, the Company currently does not have a separate NominationCommittee. This decision is kept under review. The Chairman and, where appropriate, the full Board regularlyreview the composit ion of the Board and the status of succession to both senior executive management andBoard-level posit ions. The skills and experience of current Board members are compared with the skills andexperience the Board believes are appropriate to the Company's overall business and strategic needs, both nowand in the future. Any decision relat ing to the appointment of Directors is made by the entire Board based onthe merits of the candidates and the relevance of their background and experience.

The Board aims to maintain a balance in terms of the range of experience and skills of individual Board members,which includes relevant experience of international business, mining industry and finance. The majority of theBoard are fluent in Russian. Biographies of the Board of Directors are set out earlier and available at:http://www.trans-siberiangold.com/about-us/ leadership-team/

Board of Directors

Dire cto r Nationality Age Tenure

Charles Ryan? USA 54 11 years

Alexander Dorogov RUSSIA 51 4 years

Eugene Antonov RUSSIA/CANADA 46 2 years

Robert Sasson? UK 56 7 years

Florian Fenner*? GERMANY 50 3 years

Lou Naumovski CANADA 64 3 years

Stewart Dickson UK 43 3 years

No te s :* Pre vio us ly a No n-Exe cutive Dire cto r o f the Co mpany be twe e n 2006 and 2013.

† re s igne d as Dire cto r with e ffe ct fro m 26 May 2021.

The Board is very cognisant of the discussion in respect of greater diversity in senior management and theboards of quoted companies. While we support the aims of diversity, we do not believe that a pre-determinedquota system is appropriate for TSG given its size and the scale of its operations. The Board ensures thatsuitable candidates irrespective of age, gender, ethnicity or nationality are considered object ively and fairly.

Independence of the Non-Executive Directors

The Board considers the independence of each Non-Executive Director for the purpose of the QCA Code. TheBoard considers that the current Non-Executive Directors are independent. Having consulted with theCompany's Nominated Adviser, Mr. Dickson was considered no longer to be independent for the purposes of theQCA Code. Messrs Ryan, Sasson and Fenner, all of whom resigned on 26 May 2021, are connected with UFG anestablished mult i-asset investment manager and long-term majority shareholder of TSG. TSG has published theinterests of UFG, its connected entit ies and individuals in the Company's issued share capital, having received

such notificat ion from UFG.

The Board believes that the Shareholder Directors (defined below) have brought considerable businessexperience and made a valuable contribution to the work of the Board. Given their experience of investing inRussia, skills and familiarity with the operating environment in which the Company's assets are located, the Boardbelieves their appointments to have been in the best interests of the Company. The Board believes therepresentation of UFG on the Board was proport ional to its aggregated economic interest and was beneficial toall shareholders. Further it provided an effect ive conduit for understanding and meeting the needs andexpectations of shareholders holding approximately 55% of TSG's issued shares in aggregate prior to theTakeover Offer discussed in the Chairman's Statement.

A separate committee of TSG directors, all of whom were independent for the purposes of the Offer fromHorvik Limited, was formed to consider and manage the conduct of the Offer.

Relat ionship Agreement with UFG

In accordance with the Company's adoption of the QCA Corporate Governance Code, the Board has consideredand adopted the recommendation to put in place a relat ionship agreement with its major shareholders. On 28November 2019, a Relat ionship Agreement was signed between the Company and certain entit ies of UFG. Asummary of the key terms of the Agreement is as follows:

1.UFG has agreed, amongst other things, that: UFG shall (and shall procure that each of their Associates shall) atall t imes exercise their Voting Rights so as to procure, insofar as it is able to do so by the exercise of thoserights that: (i) all transactions, agreements or arrangements entered into between a member of TSG and amember and/or Associate of UFG will be conducted at arm's length and on normal commercial terms; (ii) at allt imes the Independent Directors constitute a majority of the Board of Directors of TSG so as to enabledecisions as to the implementation and enforcement of this Agreement to be taken independently of UFGand/or their Associates; (iii) where an Independent Director ceases to be either an Independent Director or aDirector of the Company, one or more new Independent Directors may be appointed to the Board; and (iv) anydealings or disputes (including any conflicts of interest) between any member and/or Associate of UFG and anymember of the Company shall be passed to and dealt with on behalf of the Group by a committee comprisingonly the Independent Directors.

2.UFG will (i) not undertake any act ivity in conflict with those of TSG which may render the Company incapable ofcarrying on its business independently or lead to transactions and relat ionships between the Company and anymember and/or Associate of UFG which are not at arm's length or on normal commercial terms or which wouldconstitute a Related Party Transaction (as defined under the AIM Rules for Companies); or (ii) not propose orvote in favour of any resolut ion which has the effect of waiving the pre-emption rights in respect of issues ofshares to the Controlling Shareholders unless such resolut ion is supported by a majority of the IndependentDirectors.

3.TSG has granted UFG the right to nominate Directors to the Board ('Shareholder Directors'), commensurate withthe aggregate holdings of UFG as follows: (i) appoint up to a maximum of three Directors if and for so long asUFG holds more than 50 per cent of the total number of Ordinary Shares in issue; (ii) appoint up to a maximum oftwo Directors if and for so long as UFG holds more than 40 per cent of the total number of Ordinary Shares inissue; or (iii) appoint up to a maximum of one Director if and for so long as UFG holds more than 20 per cent ofthe total number of Ordinary Shares in issue. Currently, Alexander Dorogov, Chief Executive Officer, EugeneAntonov, Chief Operating Officer and Stewart Dickson and Lou Naumovski, Non-Executive Directors, areindependent of UFG. Charles Ryan, Non-Executive Chairman, and Robert Sasson and Florian Fenner, Non-Executive Directors, are not independent of UFG.

4.In addit ion, the part ies acknowledge and agree that UFG (or one or more of their Associated Bodies Corporate)shall be retained to provide certain advisory and support services to the Company on a non-exclusive basis,which shall include, but not be limited to (i) financing support; (ii) developing M&A strategy; (iii) operationalsupport; (iv) strategy development; and (v) deal origination. In consideration for the provision of such services,the Company shall pay UFG a fixed fee of $150,000 per annum, increased to $200,000 per annum with effectfrom 1 July 2020 (inclusive of any VAT or equivalent).

A full copy of the Relat ionship Agreement which terminated on 26 May 2021 can be found on the Company'swebsite.

Relat ionship Agreement with Horvik

On 18 March 2021, Horvik and TSG entered into a relat ionship agreement to ensure, among other things, thatTSG carries on its business independently of Horvik (the "Relat ionship Agreement"). Under the Relat ionshipAgreement, Horvik is entit led, subject to it sat isfying the FAS Pre-Condit ion and it having a certain level ofshareholding in TSG, to appoint up to three non-executive directors to the TSG Board. Prior to sat isfying the FASPre-Condit ion, Horvik is also entit led to appoint an observer to the TSG Board, subject to certain condit ions setout in the Relat ionship Agreement.

In addit ion, Horvik agrees to certain undertakings in connection with TSG carrying on its business independentlyof Horvik.

The Relat ionship Agreement will terminate (save for accrued rights) if Horvik holds less than 20 per cent. of theissued share capital of TSG (excluding any shares held in treasury) and Horvik has a right to give written notice toTSG to terminate the Relat ionship Agreement if Horvik holds 75 per cent. or more of the entire issued sharecapital of TSG (excluding any shares held in treasury).

A full copy of the Relat ionship Agreement can be found on the Horvik's website: https://horviklimited.com

T ime Commitment

The Company's expectation is that Non-Executive Directors should be prepared to commit 15 days a year, as anabsolute minimum, to the Group's business.

In practice, Board members' t ime commitment exceeds this minimum expectation when all the work that theyundertake for the Group is considered. As well as their work in relat ion to formal Board and Board Committeemeetings, the Non-Executive Directors also commit t ime throughout the year to meetings, telephone calls andsite visits.

On those occasions when a Director is unavoidably absent from a Board or Board Committee meeting they st illreceive and review the papers for the meeting and typically provide verbal or written input ahead of themeeting, so that their views are made known and considered at the meeting. Should Directors have concerns ofany nature which cannot be resolved within the Board meeting, they have the right to ensure that their view isrecorded in the minutes.

Information & Support

The Company Secretary is responsible to the Chairman for ensuring that all Board and Board Committeemeetings are properly conducted, that the Directors receive appropriate information prior to meetings to enablethem to make an effect ive contribution, and that governance requirements are considered and implemented.

The Company maintains Directors' and Officers' Liability insurance cover. Any Director may also take independentadvice at the Company's expense in the furtherance of his duties.

Re-election of Directors

In accordance with the Art icles of Associat ion, each year one third of the Directors (generally those who haveheld office for the longest t ime since their elect ion) will ret ire from office at the AGM. A ret iring Director may bere-elected if eligible and a Director appointed by the Board since the previous AGM may also be elected,although in the latter case the Director's period of prior appointment by the Board will not be taken into accountfor the purposes of rotat ion.

A copy of the Company's Art icles of Associat ion is available on its website at: http://www.trans-siberiangold.com/media/1253/tsg-mem-arts.pdf

All shareholders and stakeholders are eligible to subscribe to our email alerts. http://www.trans-siberiangold.com/investor-relat ions/email-alerts-sign-up/

Board performance evaluation

The Company has not conducted an external evaluation of the Board. The Board does conduct informal self-evaluation to consider the efficacy of the Board as a whole, maintain effect ive governance and ensure it is fit forpurpose to deliver the Group's strategy, which continues to provide all shareholders with attract ive returns.

Directors training and development

Directors' training needs are met by a combination of internal presentations and external speaker presentationsas part of Board and Board Committee meetings. All Directors continue to have free access to visit our miningoperations outside scheduled Board arrangements. Board training and development needs are reviewed on anon-going basis. The Board views external directorships as being an important source of industry knowledge andcorporate governance best practices. Directors may take independent professional advice, as necessary, at theCompany's expense in the furtherance of their duties.

Relations with shareholders

TSG is committed to promoting effect ive and open communication with all shareholders, ensuring consistencyand clarity of disclosure at all t imes. We strive to be accessible to both inst itut ional and private investors.

The Company has invested substantially in making information more accessible to shareholders andstakeholders. This includes a new corporate website, new corporate presentation and re-design of our financialreports.

TSG has a designated Director who is the primary point of contact with the investment community and isresponsible for maintaining TSG's on-going relat ions with investors and shareholders.

In addit ion to its annual and half-year financial reports, TSG publishes quarterly reports to the market, whichprovide further information on production and operational performance. We aim to present a balanced andunderstandable assessment of our strategy, financial posit ion and prospects.

We make information about the Group available to shareholders through a range of media, including ourcorporate website, http://www.trans-siberiangold.com, which contains a wide range of data of interest to

inst itut ional and private investors. We consider our website to be an important means of communication withour shareholders. Addit ionally, we utilise a number of alternative channels to engage with shareholders andstakeholders.

Institutional Investors

A structured engagement programme is in place to ensure regular and proactive communication withshareholders and prospective investors.

We aim to balance investor engagement throughout the year, providing the opportunity for frequent interactionwith all investors through a variety of forums including meetings, mining conferences and managementpresentations. We aim to periodically hold investor days to update investors on our business and strategy.

Private shareholders

We communicate with shareholders throughout the year through our electronic notificat ion of regulatoryannouncements, which include notificat ions of dividends, the Annual General Meeting and other init iat ives whichwe feel may be of benefit to them.

Annual General Meeting

We encourage all shareholders to part icipate at our Annual General Meeting ('AGM'). At the AGM a presentationof the Group's act ivit ies is provided. All shareholders, including private investors, have an opportunity at the AGMto put questions to members of the Board about our operations and performance. Due to the uncertaintypresented by the COVID-19 global health pandemic, the Board had to make alternative arrangements toconduct the 2020 AGM. To comply with best practice health advice and social distancing measures, TSG willconduct the 2021 AGM on the basis of a closed meeting with the minimum two persons present. The Companyencourages shareholders to submit proxy votes in connection with the resolut ions set out in the Notice of AGM.A separate shareholder engagement meeting will be held after health restrict ions have been lifted and it is safeand practicable to do so.

Stakeholder Engagement

We need constructive relat ionships with our stakeholders to optimise our business. We listen to, and work withothers, to explore the challenges we face as a business.

We engage with all stakeholder groups to build meaningful relat ionships and understand their expectations andaspirat ions. This minimises any potential negative societal impact, optimises the value we bring to localcommunit ies and maintains our licence to operate.

We hold regular face-to-face meetings, conference calls and part icipate in mult i-stakeholder discussions. Furtherinformation on how and why we engage with stakeholders is set out in 'Section 172' later in the report.

People & Culture

We value our people and encourage the development of talented and motivated employees to support thecontinued performance of our mining operations. We strive to build a sense of purpose and achievement amongall our people in the work we do.

Our culture is based on ethical values and behaviours which are set out on the Company's website at:http://www.trans-siberiangold.com/sustainability/our-people. We believe that our culture and expectedstandards are consistent with industry best-practice and our strategy.

The Group's policy is to consult and discuss with employees, through unions, staff councils and at meetings,matters likely to affect employees' interests.

The Board ensures that the policy is enacted and our values and behaviours are recognised and respected byfirst hand employee dialogue and observation on site visits ('walking the floor') and management reports fromthe SET.

How to communicate with us

Email [email protected]

Telephone +44 (0) 1480 811871

Website http://www.trans-siberiangold.com

LinkedIn https://www.linkedin.com/company/trans-siberian-gold-plc/

Instagram https://www.instagram.com/transsiberiangoldplc/

Post Trans-Siberian Gold plc, P.O. Box 278, St. Neots, PE19 9EA. United Kingdom

Assessing our performance against the QCA Code - A summaryPrinc iple Ke y po ints o f ho w we de live r

DELIVER GROWT H

Est ablish a st rat egy and businessmo del which pro mo t e lo ng-t erm value

• Cle arly s tate d & co mmunicate d o n the Co mpany's we bs ite and in o ur co rpo ratemate rials (annual re po rts , inve s to r pre se ntatio ns ).

f o r shareho lders. • Ho w we de live r o ur s trate gy and me asure pro gre ss (KPIs ) are se t o ut in o ur AnnualRe po rt.

• Risks to o ur s trate gy and o ur actio ns to mitigate the m are se t o ut in o ur AnnualRe po rt.

Seek t o underst and and meetshareho lder needs and expect at io ns.

• Cle arly s tructure d e ngage me nt pro gramme in place fo r bo th ins titutio nal and privateinve s to rs .

• Inve s to r ro adsho w fe e dback share d and discusse d at Bo ard me e tings .• Inve s te d in mo re co mpre he ns ive and appe aling co rpo rate mate rials and we bs ite .• Es tablishe d multiple co mmunicatio n channe ls (o nline and o ffline ).

T ake int o acco unt wider st akeho lderand so cial respo nsibilit ies and t heirimplicat io ns f o r lo ng-t erm success.

• Ke y s take ho lde rs are ide ntifie d and the ir ne e ds are unde rs to o d.• We bs ite disc lo sure s o f re gio nal and lo cal me mbe rships and activitie s .• Transpare ncy o f Co mpanie s Ho use filings o f Payme nts to Go ve rnme nts .• Cle ar po licy o n Mo de rn S lave ry and Supply-Chain manage me nt available o n the

Co mpany's we bs ite .

Embed ef f ect ive risk management ,co nsidering bo t h o ppo rt unit ies andt hreat s t hro ugho ut t he o rganisat io n.

• Risks to o ur s trate gy and o ur actio ns to mitigate the m are se t o ut in o ur annualre po rt.

MAINT AIN A DYNAMIC MANAGEMENT FRAMEWORK

Maint ain t he bo ard as a well-f unct io ning, balanced t eam led by t heChair.

• Ro le s and re spo ns ibilitie s are se t o ut o nline and in the Co mpany's Annual Re po rt.• De tails abo ut the o pe ratio n o f the Bo ard are inc lude d in this do cume nt.• Co mpo s itio n o f the Bo ard and its e ffe ctive ne ss is discusse d in o ur Annual Re po rt.• The Co mpany has a minimum o f two inde pe nde nt No n-Exe cutive Dire cto rs .• No n-inde pe nde nt Dire cto rs are ide ntifie d, the re aso ns why and the ir co ntributio n are

e xplaine d.• Bo ard co mmitte e s are se t o ut o n the Co mpany's we bs ite and in o ur Annual Re po rt.• De tails o f time co mmitme nts and me e ting atte ndance are se t o ut in this do cume nt.

Ensure t hat bet ween t hem t heDirect o rs have t he necessary up-t o -dat e experience, skills and capabilit ies.

• Bio graphie s o f Dire cto rs are available o n the Co mpany's we bs ite and in o ur annualre po rt.

• D ire cto rs have a ble nd o f mining se cto r, finance and capital marke ts e xpe rie nce .• D ive rs ity co ns ide re d but quo ta sys te m asse sse d to be inappro priate .

Evaluat e bo ard perf o rmance based o nclear and relevant o bject ives, seekingco nt inuo us impro vement .

• An inte rnal bo ard e valuatio n was inte nde d to be co nducte d fo r FY20 , but waspo s tpo ne d as impracticable during COVID-19 re s trictio ns .

Pro mo t e a co rpo rat e cult ure t hat isbased o n et hical values and behavio urs.

• Ethical value s and be havio urs are se t o ut o nline .• Value s and be havio urs are re co gnise d and re spe cte d by firs t hand e mplo ye e

dialo gue and o bse rvatio n o n s ite vis its ('walking the flo o r') and manage me nt re po rtsfro m the SET.

Maint ain go vernance st ruct ures andpro cesses t hat are f it f o r purpo se andsuppo rt go o d decisio n-making by t heBo ard.

• Go ve rnance s tructure s and pro ce sse s ke pt unde r re vie w.• This s tate me nt e xplains ho w we apply the QCA Co de .• Ro le s and re spo ns ibilitie s are se t o ut o n the Co mpany's we bs ite and in o ur Annual

Re po rt.

BUILD T RUST Co mmunicat e ho w t he Co mpany isgo verned and is perf o rming bymaint aining a dialo gue wit hshareho lders and o t her relevantst akeho lders.

• S ignificantly incre ase d o ur e ngage me nt with share ho lde rs and s take ho lde rs .• Multi-channe l co mmunicatio n channe ls to fac ilitate dialo gue and fe e dback - se e

o nline and this do cume nt.• Go ve rnance info rmatio n and do cume nts fre e ly available .

As a UK company with a list ing on the AIM Market of the London Stock Exchange, TSG is required to make certainstatements regarding the way it is governed. Accordingly, this statement in its entirety explains how TSGapplies the Ten Principles of the Corporate Governance Code as set out in the QCA Code.

Directors' Report

The Directors present their annual report and auditedconsolidated financial statements for the year ended 31December 2020

Principal act ivit ies

Trans-Siberian Gold plc is a UK-based resources company, whose Asacha Gold Mine in the Far East of the RussianFederation has been in production since September 2011.

Results and dividends

The financial results for the year are set out in the Financial Statements and show a net profit of $20.3 million forthe year ended 31 December 2020 (2019: $9.0 million).

During the financial year, the Company paid an interim dividend of $0.08 per ordinary share, equivalent toapproximately $7.0 million.

The Company has a track record of making regular, sustainable, dividend payments however due to the Takeover

offer, the Board is unable to recommend a final dividend for FY20.

Share capital

The Company's issued share capital as at 31 December 2020 was 87,158,508 ordinary shares (2019:110,053,073).

On 12 July 2019 the Company completed a share buy back from two of its major shareholders within UFG AssetManagement ('UFG') amounting to 22,894,565 ordinary shares which were held in treasury. On 26 May 2021,4,787,816 ordinary shares were issued from treasury in consideration of awards under the Company's Long TermIncentive Plans which had vested as a result of the completion of the acquisit ion of the shares of the SellingShareholders by Horvik Limited as described in the Company's announcement dated 18 March 2021.

Post period further shares were repurchased on-market wherefore as at the date of this document theCompany's issued share capital comprises 91,739,867 ordinary shares together with 18,313,206 shares held intreasury.

Significant Shareholdings

At the date of this document, the following interests of 3% or more in the issued share capital of the Companyappeared in the register maintained in accordance with section 808 of the Companies Act 2006:

Share ho lde r

% o f is sue dsharecapital

Horvik Limited 48.6%

UFG CapitalInvestmentManagement 6.1%

BHF AssetManagement 4.7%

Lord Michael Spencer 3.3%

Hanover Nominees 3.3%

The ult imate control of the Company is discussed in note 34 to the financial statements.

Directors interests

At the date of this document, the Directors have the following direct beneficial interests in the share of theCompany:

Dire cto rNo . o f OrdinaryShare s

Lou Naumovski Nil

AlexanderDorogov 2,527,555

Eugene Antonov 1,380,249

Stewart Dickson 503,389

FELDI Limited* 29,999

* S te wart Dickso n is a Dire cto r and s ignificant share ho lde r o f FELDI Limite d.

These beneficial interests include ordinary shares transferred from treasury on 26 May 2021 in sat isfact ion ofLTIP Awards which had vested as discussed below.

Long Term Incentive Plans

As announced on 8 June 2020 and 28 August 2020, the Company established two Long Term Incentive Plans (the"LTIPs") under which awards were made to the executive directors and certain non-executive directors (the "LTIPAwards").

As a consequence of the increase in Horvik's interest in TSG Shares, the LTIPs have vested under the change ofcontrol provisions in the LTIP rules.

The LTIP Awards comprised a total of 4,347,988 condit ional share Awards and options in respect of 550,000 TSGShares (the "Options"). As reported on 29 April 2021 the Company had received notice to exercise the Options(condit ional upon the Second Completion) and, where applicable, each LTIP Award holder had elected for cashlesssett lement, whereby the Award Price is netted off (at the Acquisit ion Price of £1.18 per TSG Share) against thenumber of TSG Shares to be transferred to them in sat isfact ion of their LTIP Award.

The Directors have irrevocably agreed, subject to the terms set out in the announcement by Horvik on 18 March2021, to accept the cash offer to be made by Horvik in respect of their TSG Shares including the Award Shares.

No equity incentives or options were granted or were in existence during the year ended 31 December 2019.

Following the Second Complet ion, the Company transferred TSG Shares to the Award Holders out oftreasury (the "Award Shares") as shown in the following table:

Award Ho lde r AwardsAggre gate AwardPrice (£)

Award Value (£) at£1.18/share Award Value (£) ne t Award Share s

Alexander Dorogov 2,297,988 Nil 2,297,988

Eugene Antonov 1,300,000 Nil 1,300,000

Charles Ryan 250,000 25,000 295,000 270,000 228,813

Florian Fenner 250,000 25,000 295,000 270,000 228,813

Robert Sasson 250,000 25,000 295,000 270,000 228,813

Stewart Dickson 550,000 55,000 649,000 594,000 503,389

Total 4,897,988 4,787,816

Polit ical and charitable donations

During the financial year ended 31 December 2020 the Group made no polit ical donations (2019: $nil). In 2020 theGroup has made a charitable donation of approximately RUB 5million in connection with the COVID-19 globalhealth pandemic in Kamchatka.

Financial instruments

Details of the Group's financial instruments and its key financial risks are set out in note 25 to the financialstatements which forms part of this Directors' Report.

Subsequent events

These events are discussed in the Operating and Financial Review and in note 35 to the financial statements.

Going concern

The Group's operations are cash generative and management t ightly control the level of committed expenditureto ensure that the Group has sufficient resources available to meet its liabilit ies as they fall due. Regular cashforecasts are reviewed to assess the potential impact of factors such as changes in commodity prices,production rates and the t iming of capital expenditure. The Group has reported an operating profit for the yearof $27.5 million, an operating cash inflow of $41.2 million and net increase in cash of $13.7 million. The Directorshave reviewed the Group's cash flow forecast for the period to 31 December 2022 and carried out mult iplescenario analysis of potential downsides including future lockdowns of various length; production, workforce andsupply chain disruptions together with reasonably possible changes in commodity prices; and scheduledrepayments of loan facilit ies. The Directors further stress tested combinations of various scenarios identifyingno significant cash concerns. Based on these analyses, the Directors believe that the Group has sufficientresources to continue in operational existence for the foreseeable future. Furthermore, the Directors haveconsidered the impact of Horvik's acquisit ion discussed in note 35 on the going concern of the Group. In formingtheir opinion the Directors have relied upon the public statements made by Horvik about its future intentions forthe Group, which outline its commercial and financial rat ionale for the acquisit ion. While the Directors are unableto provide surety that such intentions will be enacted, they are not aware of any planned actions which may castdoubt over the Group's future operational existence.

The Directors have also considered the change of control clause within the Company's credit facilit ies with VTBand are comfortable that this does not have an impact on the going concern status of the Group in light of theGroup's cash posit ion and the outstanding loan balance at 31 December 2020 and for the reasons outlined innote 23 and note 35. Therefore the Directors believe that the Group will continue as a going concern and haveprepared the financial statements on that basis.

Disabled persons

Applicat ions for employment by disabled persons are always fully considered, bearing in mind the aptitudes ofthe applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensurethat their employment within the Group continues and that the appropriate training is arranged. It is the policy ofthe Group that the training, career development and promotion of disabled persons should, as far as possible,be identical to that of other employees.

Employee involvement

The Group's policy is to consult and discuss with employees, through unions, staff councils and at meetings,matters likely to affect employees' interests.

Information about matters of concern to employees is given through information bullet ins and reports whichseek to achieve a common awareness on the part of all employees of the financial and economic factorsaffect ing the Group's performance.

Further information about our people and culture is set out in the Corporate Governance Review.

Directors

The Directors who held office during the year and up to the date of signature of the financial statements wereas follows:

Board of DirectorsDire cto r No te s

Charles Ryan Resigned pursuant to the Takeover offer on 26 May 2021

Alexander Dorogov Eugene Antonov Robert Sasson Resigned pursuant to the Takeover offer on 26 May 2021

Florian Fenner Resigned pursuant to the Takeover offer on 26 May 2021

Lou Naumovski Stewart Dickson

In accordance with the provisions of the Company's Art icles of Associat ion, Mr. Dickson will ret ire by rotat ion atthe forthcoming Annual General Meeting and, being eligible, offers himself for re-elect ion.

Board of Directors

The Company's board currently comprises two Executive Directors and two Non-Executive Directors, includingthe Interim Chairman. The Non-Executive Directors are considered by the board to be independent ofmanagement and free from any business or other relat ionship that could materially interfere with the exercise oftheir independent judgement.

Under the Relat ionship Agreement with Horvik, it is entit led, subject to it sat isfying the FAS Pre-Condit ion and ithaving a certain level of shareholding in TSG, to appoint three non-executive directors to the TSG Board.

The Board ordinarily meets on a bi-monthly basis to determine strategy and to approve budgets and businessplans, major capital expenditure, acquisit ions and disposals. Addit ional meetings are held as appropriate totransact other business. Formal agendas, briefing papers and reports are sent to the Board in advance of itsmeetings. The Board delegates certain of its responsibilit ies to two Board Committees, which have clearlydefined terms of reference as described below.

The Directors have access to the advice and services of the Company Secretary. Any Director may also takeindependent professional advice at the Company's expense in the furtherance of his duties. In accordance withthe Art icles of Associat ion, each year one third of the Directors (generally those who have held office for thelongest t ime since their elect ion) will ret ire from office at the AGM. A ret iring Director may be re-elected ifeligible and a Director appointed by the Board may also be elected, although in the latter case the Director'speriod of prior appointment by the Board will not be taken into account for the purposes of rotat ion.

Audit CommitteeRefer to Corpora te Governance Review

Remuneration CommitteeRefer to Corpora te Governance Review

Offer CommitteeRefer to Corpora te Governance Review

Qualifying third party indemnity provisions

The Company has made qualifying third-party indemnity provisions, as defined in section 234 of the CompaniesAct 2006, for the benefit of the Directors in respect of liabilit ies incurred as a result of their office to the extentpermitted by law. These provisions remain in force at the report ing date. The Company also maintained aDirectors' and Officers' liability insurance policy throughout the financial year.

Internal control

The Board is responsible for ensuring that the Group maintains an adequate system of internal control and riskmanagement. The internal controls are designed to safeguard the Group's assets and to ensure the reliability offinancial information both for internal use by management and for external report ing.

The Directors are aware that no system can provide absolute assurance against material misstatement or lossbut are satisfied that the current controls and processes to manage significant risks are adequate with regardto the current stage of the Group's development.

Shareholders

The Board attaches great importance to maintaining good relat ionships with all its shareholders and ensures thatall price sensit ive information is released to its shareholders simultaneously in accordance with the AIM Rules forCompanies and Market Abuse Regulat ions.

The Board believes that the AGM provides an important opportunity for dialogue with private shareholders. Dueto COVID-19 restrict ions the AGM will be a closed meeting. A separate shareholder engagement meeting will beheld after health restrict ions have lifted and it is safe and practical to do so.

The Company's website, www.trans-siberiangold.com, is regularly updated and contains a wide range ofinformation about the Group.

Further information about how the Group manages its relat ionship with shareholders is set out in the CorporateGovernance Review.

Stakeholders

s172 Companies Act 2006

The Directors are well aware of their duty under s.172 of the Companies Act 2006 to act in the way which theyconsider, in good faith, would be most likely to promote the success of the Company for the benefit of itsmembers as a whole and, in doing so, to have regard (amongst other matters) to:

• the likely consequences of any decision in the long term;

• the interests of the Company's employees;

• the need to foster the Company's business;

• relat ionships with suppliers, customers and others;

• the impact of the Company's operations on the community and the environment;

• the desirability of the Company maintaining a reputation for high standards of business conduct; and

• the need to act fairly as between members of the Company.

As a Board we have always been mindful of the long term when taking decisions, and collect ively and individuallyour aim is always to uphold the highest standards of conduct. Similarly, we understand that our business can onlygrow and prosper over the long term if we understand and respect the views and needs of our customers,colleagues and the communit ies in which we operate, as well as our suppliers, the environment and theshareholders to whom we are accountable.

We set out in the adjacent table our key stakeholder groups, their material issues and how we engage withthem. Each stakeholder group requires a tailored engagement approach to foster effect ive and mutuallybeneficial relat ionships. By understanding our stakeholders, we can factor into Boardroom discussions thepotential impact of our decisions on each stakeholder group and consider their needs and concerns, inaccordance with s172 of the Companies Act 2006.

This in turn ensures we continue to provide quality gold to our customers, work effect ively with our colleaguesand contractors, make a posit ive contribution to local communit ies and achieve long-term sustainable returnsfor our investors. Act ing in a fair and responsible manner is a core element of our business practice.

Ongoing engagement with our stakeholdersOurs take ho lde rs Why the y matte r to TSG

What matte rs to o urs take ho lde rs Ho w we e ngage d

Link to Mitigating o urPrinc ipal Risks

Cust o mers The y are the supplie rs o fre fine d pre cio us me tals whore ly o n us and o the r go ldmine rs to he lp the m de live r agre at se rvice to the ir c lie nts

We kno w o ur cus to me rsse e k a re liable and highquality so urce o f pre cio usme tals

• Sale s o f pro ducts• Labo rato ry analys is• Co rre spo nde nce

• Re se rve & Re so urcee s timatio n

• Mining & Pro ce ss ing• Go ld price vo latility

Emplo yees The y are a ke y re so urce o f theGro up, all de dicate d toe xtracting and pro ce ss ing go ldsafe ly, re spo ns ibly andpro fitably

Our co lle ague s areco nce rne d witho ppo rtunitie s fo r pe rso nalde ve lo pme nt and care e rpro gre ss io n; a culture o finc lus io n and safe ty;co mpe nsatio n andbe ne fits ; and the ability tomake a diffe re nce withinTSG

• Inte rnal co mmunicatio ns• HR initiative s• 'Walking the flo o r'

• Mining & Pro ce ss ing• He alth & Safe ty• COVID-19

Co mmunit ies Whils t we o pe rate in a re mo telo catio n, the co mmunitie s inKamchatka are impo rtant asthe y can be dire ctly o rindire ctly affe cte d by o uro pe ratio ns . We are pro ud thatwe are a s ignificant e mplo ye ro f lo cal pe o ple and whe repracticable , so urce supplie sfro m lo cal pro vide rs

Our co mmunitie s wantTSG to make a po s itiveco ntributio n to lo calso cie ty and make apo s itive diffe re nce byacting re spo ns ibly andsus tainably

• Suppo rte d the pre s tigio usannual do g rac ingco mpe titio n in Kamchatka

• Made a RUB5m do natio n tothe fight agains t COVID-19 inKamchatka

• Mining & Pro ce ss ing• Enviro nme ntal

le gis latio n &co mpliance

• He alth & Safe ty• COVID-19

Suppliers Our supplie rs pro vide us withinputs to e nable and e nhanceo ur o pe ratio ns

Our supply chains tre tche s o ve r re gio naland natio nal bo rde rs . Ourchalle nge is to e nsurethat the ir o pe ratio n isaligne d whe re practicable ,with o ur po lic ie s andre spo ns ible practice s

• Se arching fo r lo cal supplie rswhe re po ss ible

• Te rms o f trade• Pro ce ss and pro cure me nt

mo nito ring

• Mining & Pro ce ss ing• Enviro nme ntal


• He alth & Safe ty• COVID-19

Go vernment& regulat o rs

The go ld mining indus try issubje ct to go ve rnme nt po licywhich is imple me nte d thro ughle gis latio n and re gulatio n

The re gulato ry andle gis lative autho ritie se xpe ct co mpliance withwide -ranging indus tryre quire me nts

• Fo rmal e nquirie s• Me e tings• Trade Asso ciatio ns e .g.

Unio n o f Go ld Pro duce rs o fRuss ia

• Re gulato rye nviro nme nt

• Mining le gis latio n &lice ns ing

• Enviro nme ntal


• Taxatio n• COVID-19

Invest o rs The y are o ur pro vide rs o fcapital witho ut who m we co uldno t gro w and inve s t fo r futuresucce ss

Inve s to rs scrutinise o uractivity o n a range o fme asure s be yo ndfinancial pe rfo rmance toe nsure that inve s tme ntrisks are limite d andre turns are sus tainable

• Re gular me e tings (ho lde r &no n-ho lde r)

• Co mmunicatio ns such asquarte rly o pe ratio nal re sults ,annual re po rts and no tice so f ge ne ral me e tings

• S to ck Exchangeanno unce me nts and pre ssre le ase s

• Inve s to r co nfe re nce s• De taile d info rmatio n abo ut

TSG and matte rs o f inte re s tto inve s to rs o n o ur we bs ite

• Re se rve & re so urcee s timate s

• Mining & Pro ce ss ing• Pro pe rty & bus ine ss

inte rruptio n insurance• Go ld price vo latility• Taxatio n• COVID-19

Indust ry We o fte n face s imilaro ppo rtunitie s and challe nge sas o ur pe e rs in the go ldmining indus try. By sharingkno wle dge and be s t practice swe can addre ss the m

We kno w the po s itiveimpact wo rkingco llabo rative ly as anindus try can have

• Me e tings• Indus try Co nfe re nce s• Trade Asso ciatio ns e .g.

Unio n o f Go ld Pro duce rs o fRuss ia

• Re gulato rye nviro nme nt

• Mining le gis latio n &lice ns ing

• Enviro nme ntalle gis latio n &co mpliance

• Go ld price vo latility• Taxatio n• COVID-19

Ours take ho lde rs Why the y matte r to TSG

What matte rs to o urs take ho lde rs Ho w we e ngage d

Link to Mitigating o urPrinc ipal Risks

Factoring our stakeholders into our decisions

By thoroughly understanding our key stakeholder groups, we can factor their needs and concerns intoBoardroom discussions.

The Board requires of itself an assessment and discussion of potential impacts in connection with materialdecisions requiring its approval that could impact on one or more of our stakeholder groups.

This assessment and discussion assists the Directors in performing their duties under s172 of the CompaniesAct 2006 and provides the Board with assurance that the potential impacts on our stakeholders are beingcarefully considered by management when developing plans for Board approval.

The stakeholder assessment and discussion identifies:

• potential benefits and areas of concern for each stakeholder group;

• the procedures and plans being implemented to mit igate against any areas of concern; and

• who is responsible for ensuring the mit igation plans are being effect ively implemented.

Independent Auditors

PricewaterhouseCoopers LLP have expressed their willingness to continue in office and a Resolut ion to re-appoint them will be proposed at the Annual General Meeting.

Statement of Directors' responsibilit ies in respect of the financial statements

The Directors are responsible for preparing the Annual Report and the financial statements in accordance withapplicable law and regulat ion.

Company law requires the Directors to prepare financial statements for each financial year. Under that law theDirectors have prepared the Group and the Company financial statements in accordance with internationalaccounting standards in conformity with the requirements of the Companies Act 2006.

The Group have also prepared financial statements in accordance with and international financial report ingstandards adopted pursuant to Regulat ion (EC) No 1606/2002 as it applies in the European Union.

Under company law, Directors must not approve the financial statements unless they are satisfied that theygive a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Groupfor that period. In preparing the financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• state whether applicable international accounting standards in conformity with the requirements of theCompanies Act 2006 and international financial report ing standards adopted pursuant to Regulat ion (EC) No1606/2002 as it applies in the European Union have been followed, subject to any material departures disclosedand explained in the financial statements;

• make judgements and accounting est imates that are reasonable and prudent; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that theGroup and Company will continue in business.

The Directors are also responsible for safeguarding the assets of the Group and Company and hence for takingreasonable steps for the prevention and detection of fraud and other irregularit ies.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explainthe Group's and Company's transactions and disclose with reasonable accuracy at any t ime the financial posit ion

of the Group and Company and enable them to ensure that the financial statements comply with the CompaniesAct 2006.

The Directors are responsible for the maintenance and integrity of the company's website. Legislat ion in theUnited Kingdom governing the preparation and dissemination of financial statements may differ from legislat ionin other jurisdict ions.

Directors' confirmations

In the case of each Director in office at the date the Directors' report is approved:

• so far as the Director is aware, there is no relevant audit information of which the Group's and Company'sauditors are unaware; and

• they have taken all the steps that they ought to have taken as a Director in order to make themselves awareof any relevant audit information and to establish that the Group's and Company's auditors are aware of thatinformation.

Website publicat ion

The Directors are responsible for ensuring the annual report and the financial statements are made available on awebsite. Financial statements are published on the Company's website in accordance with legislat ion in theUnited Kingdom governing the preparation and dissemination of financial statements, which may vary fromlegislat ion in other jurisdict ions. The maintenance and integrity of the Company's website is the responsibility ofthe Directors. The Directors' responsibility also extends to the on-going integrity of the financial statementscontained therein.

On behalf of the Board

Alexander Dorogov

Chief Executive Officer

8 June 2021

Financial Statements

Independent Auditors' Report to the members of Trans-SiberianGold plc

Report on the audit of the financial statementsOpinionIn our opinion, Trans-Siberian Gold plc's Group financial statements and Company financial statements (the "financial statements"):

• give a true and fair view of the state of the Group's and of the Company's affairs as at 31 December 2020 and of the Group'sprofit and the Group's and Company's cash flows for the year then ended;

• have been properly prepared in accordance with international accounting standards in conformity with the requirements of theCompanies Act 2006; and

• have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements, included within the Annual Report and Financial Statements (the "Annual Report"), whichcomprise: the Consolidated and Company Statements of Financial Position as at 31 December 2020; the Consolidated Statement ofComprehensive Income, the Consolidated and Company Statements of Cash Flows and the Consolidated and Company Statements ofChanges in Equity for the year then ended; and the notes to the financial statements, which include a description of the s ignificantaccounting policies.

Separate opinion in relation to international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002as it applies in the European UnionAs explained in note 1.2 to the financial statements, the Group, in addition to applying international accounting standards in conformitywith the requirements of the Companies Act 2006, has also applied international financial reporting standards adopted pursuant toRegulation (EC) No 1606/2002 as it applies in the European Union.

In our opinion, the Group financial statements have been properly prepared in accordance with international financial reportingstandards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.

Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Ourresponsibilities under ISAs (UK) are further described in the Auditors ' responsibilities for the audit of the financial statements sectionof our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

IndependenceWe remained independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial

statements in the UK, which includes the FRC's Ethical Standard, as applicable to listed entities, and we have fulfilled our other ethicalresponsibilities in accordance with these requirements.

Our audit approachOverviewAudit scope• We conducted full scope audits of two significant components out of the Group's three separate reporting entities which

were selected due to their size and risk characteristics.• Specific audit procedures were performed on certain balances and transactions at a further one reporting unit.• This enabled us to obtain 100% coverage of consolidated revenue, 99% coverage of consolidated profit before tax and

99% coverage of total assets for the Group.• To ensure sufficient oversight, direction and responsibility of the audit work performed by our component audit team in

Russia, the Group team performed a number of procedures throughout the audit which included directing the auditapproach and procedures, conducting remote file reviews and conducting remote face to face meetings with localmanagement and the component team.

Key audit mat ters• Valuation of ore stocks (Group).• Consideration of the impact of COVID-19 (Group and Parent).• Impairment of investments in subsidiaries (Parent).

Materialit y• Overall Group materiality: $894,000 (2019: $509,000) based on 5% of three-year average profit before tax.• Overall Company materiality: $376,000 (2019: $407,000) based on 0.5% of total assets.• Performance materiality: $670,000 (Group) and $282,000 (Company).

The scope of our auditAs part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financialstatements.

Key audit mattersKey audit matters are those matters that, in the auditors ' profess ional judgement, were of most s ignificance in the audit of thefinancial statements of the current period and include the most s ignificant assessed risks of material misstatement (whether or notdue to fraud) identified by the auditors, including those which had the greatest effect on: the overall audit strategy; the allocation ofresources in the audit; and directing the efforts of the engagement team. These matters, and any comments we make on the resultsof our procedures thereon, were addressed in the context of our audit of the financial statements as a whole, and in forming ouropinion thereon, and we do not provide a separate opinion on these matters.

This is not a complete list of all risks identified by our audit.

Impairment of investments in subsidiaries is a new key audit matter this year. Impairment of property, plant and equipment, whichwas a key audit matter last year, is no longer included because there have been no impairment trigger events as at 31 December2020 that could imply a risk of impairment in property, plant and equipment. Otherwise, the key audit matters below are consistentwith last year.

Key audit matter How our audit addressed the key audit matter

Valuation of ore stocks (Group) Refer to note 20, Inventories. The Group's ore stocks arevalued at the lower of cost and net realisable value. At 31December 2020 the ore stocks are valued at $8.1m (2019:$6.3m).Historically management recognised a provision against thelow grade ore stocks but this provision was released in 2018following management's decision to start blending the lowgrade ore stocks with the higher grade mined ore. Thisblending increased the net realisable value of the low gradeore stocks. In the financial year, mining commenced in theEast Zone of the Asacha Gold Mine, which containssignificantly higher-grade ore, increasing the blending andutilisation of the ore stocks.The valuation and the current/non-current classification of orestocks is impacted by the grade, future ore blending ratios,ore processing and refining costs and the price of gold. Therecoverability and valuation is dependent on the ability of theGroup to continue to blend low grade and high grade ore.Management expects to have fully processed all of the lowgrade stocks by the end of 2021.We focused on this area due to the material nature of thebalance and the judgement involved in the valuation and thecurrent/non-current classification of ore stocks.

We examined management's calculation of the valuation ofthe ore stocks and undertook the following procedures:• Understood management's decision and ability to blend

low grade ore stocks with higher grade mined ore in thefuture;

• Compared the gold prices used in the calculation toavailable market data;

• Tested management's cost assumptions and agreed themto actual costs incurred in 2020;

• Tested management's calculation of the overall ore stocksvolume and grade. This included sampling a number of orebatches and comparing the gold grade measured by theGroup's internal specialists to the results of theindependent re-measurement performed by a third-party;

• Considered the grade of future mined ore throughvalidating the volume and grade assumed in the life ofmine plan to the independent, third party reserves report;

• Assessed the competency, independence and objectivity ofthe third-party engaged by management to value the orestocks; and

• Recalculated management's blending ratio which is basedon the size and grade of the ore stocks and expected futuremined ore.

In line with the life of mine plans, during 2020 ore mined wasof a higher grade than the ore held in the stockpiles but theGroup continued to utilise the lower grade ore stocks byblending these with the higher grades mined when feedingthe processing plant. This supports the recoverability of theore stocks.Based on these enquiries and procedures, we are satisfiedwith management's judgement that a provision against thecarrying value of the ore stocks is not required. Finally, weconsidered the adequacy of management's disclosure of thekey judgement in relation to the valuation of the ore stocks,and their classification, and consider it to be reasonable.

Consideration of the impact of COVID-19 (Group andParent)

Refer to the Strategic Report, the Directors' Report and note1.4, Going concern.

We obtained and considered management's assessment ofthe impact of COVID-19 on the Group's operations, the

COVID-19 was declared a pandemic by the World HealthOrganisation on 11 March 2020 and the ongoing response ishaving an unprecedented impact on the global economy.Management have set out in the Annual Report the impactthat COVID-19 has had on the Group and the Company andthe actions that they have taken, and continue to take, toaddress the pandemic and its effect on the operations.The Directors considered the impact of the pandemic on theGroup's operations, cash flows, day to day operations, and thecarrying amount of long-term assets and receivables, as wellas a need to recognise additional liabilities. As part of thisassessment, the Directors modelled various downsidescenarios to their base case budgets taking into account thepossible effects of COVID-19 on the operations.Having taken into account these scenarios and a robustassessment of planned and possible mitigating actions, theDirectors concluded that the Group remains a going concern,that there is no material uncertainty in respect of thisconclusion and that there is no impact on the carrying valuesof assets and liabilities.We determined the Directors' consideration of the impact ofCOVID-19 to be a key audit matter.

recoverability of its long-term assets, the carrying value of itsassets and liabilities and its ability to continue as a goingconcern. We undertook the following procedures:We considered the potential impact on the balance sheet,specifically around property, plant and equipment and tradereceivables and do not consider there to be any indicators ofmaterial impairment as at the balance sheet date orsubsequently (for disclosure only) and no provisions oradditional liabilities were recorded.We reviewed the disclosures relating to the impact in the yearand the potential impact of COVID-19 and found them to beconsistent with the analysis performed.The procedures we performed to evaluate the Directors' goingconcern assessment and our conclusions, are set out in the"Conclusions relating to going concern" section below.Overall, we consider the assessment by management inrelation to COVID-19, and the associated disclosures in theAnnual report, to be appropriate.

Impairment of investments in subsidiaries (Parent) Refer to note 18, Investments in subsidiaries, and note 19,Subsidiaries.Impairment assessments require significant judgement andthere is a risk that the valuation of the assets may beincorrect, and any potential impairment charge or reversalmiscalculated. As such, this was a key area of focus for ouraudit due to the size of the balance.As disclosed in note 18, the Company has investments of$74m in subsidiaries.The Directors have considered the recoverability of theinvestments in subsidiaries at 31 December 2020 anddetermined that there were no triggers for impairment, havingconsidered factors such as long-term gold prices, resourceestimates and expected production profiles. Accordingly, theydetermined that the carrying values of the investments insubsidiaries are supportable.

We challenged the assessment of any impairment indicatorsand considered it to be consistent with the approach taken forthe Group impairment assessment and therefore reasonable.Based on our analysis of the assessment of the recoverableamount of each investment, we concur that the carryingvalues of the investments in subsidiaries are supportable andnote that no impairment triggers were identified. We considerthe Directors' conclusions and the associated disclosures tobe appropriate.

How we tailored the audit scopeWe tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statementsas a whole, taking into account the structure of the Group and the Company, the accounting processes and controls , and the industryin which they operate.

Trans-Siberian Gold plc is listed on AIM. The Group's principal operation is the Asacha Gold Mine in Far East Russia. In establishing theoverall approach to the Group audit, we determined the type of work that needed to be performed by us, as the Group audit team, orby our PwC network component team in Russia.

Our Group audit scope focused primarily on the Asacha gold mine in Russia, which was subject to a full-scope audit by our componentteam in Russia. A full scope audit was also performed over the parent company by the Group team. Specific audit procedures oncertain balances and transactions were performed at a further one reporting unit. The above gave us coverage of 100% ofconsolidated revenue, 99% coverage of consolidated profit before tax and 99% coverage of total assets for the Group.

As COVID-19 prevented travel to Russia, we were unable to make a s ite vis it as planned; we instead conducted our overs ight of ourcomponent audit team through regular dialogue via conference calls , video conferencing and other forms of communication asconsidered necessary as well as remote working paper reviews to satis fy ourselves as to the appropriateness of audit workperformed by our component audit team. We also attended key meetings virtually with local management and our component auditteam. We reviewed the audit work of our component audit team, which included file reviews, participation in key audit discussions withlocal management and participation in the audit clearance meeting.

The Group engagement team directly performed the audit of the consolidation. This , together with additional procedures performed atthe Group level, gave us the evidence we needed for our opinion on the Group financial statements as a whole.

MaterialityThe scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These,together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our auditprocedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, bothindividually and in aggregate on the financial statements as a whole.

Based on our profess ional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements - group Financial statements - company

Overall materiality $894,000 (2019: $509,000). $376,000 (2019: $407,000).

How we determined it 5% of three year average profit before tax 0.5% of total assets

Rationale for benchmarkapplied

Profit is the key indicator of the Group'sperformance and the most appropriatebenchmark for materiality. Due to volatility incommodity prices which has impactedprofitability, we have used a three-yearaverage profit before tax as the benchmark.

We have assessed that the most appropriatebenchmark for the Company, which is primarilya holding company, is total assets.

For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality. Therange of materiality allocated across components was between $376,000 and $890,000. Certain components were audited to a localstatutory audit materiality that was also less than our overall group materiality.

We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected andundetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our

audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example indetermining sample s izes. Our performance materiality was 75% of overall materiality, amounting to $670,000 for the Group financialstatements and $282,000 for the Company financial statements.

In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment andaggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of our normal range wasappropriate.

We agreed with those charged with governance that we would report to them misstatements identified during our audit above$89,000 (Group audit) (2019: $50,000) and $89,000 (Company audit) (2019: $50,000) as well as misstatements below those amountsthat, in our view, warranted reporting for qualitative reasons.

Conclusions relating to going concernOur evaluation of the Directors ' assessment of the Group's and the Company's ability to continue to adopt the going concern basis ofaccounting included:

• Obtaining and reviewing the Group's cash flow forecasts for the going concern period, challenging the Directors ' assumptions usedand verifying that these were consistent with our existing knowledge and understanding of the business, as well as with the Board-approved budget;

• Reviewing the Group's cash flow forecasts under various downside scenarios, including a severe but plausible downside scenario,evaluating the assumptions used, and verifying that the Group is able to maintain liquidity within the going concern period underthese scenarios;

• Testing the model for mathematical accuracy;• Understanding the Directors ' assessment of the implications of the Offer to acquire the Group made by Horvik for their going

concern assessment, which included reviewing the public announcements made by Horvik outlining the commercial and financialrationale for the Transaction and about its future intentions for the Group; and considering the implications of the change in controlclause in the current financing arrangements. We note that these public announcements confirmed Horvik's intention to continuethe operations of the Group as part of their strategy of establishing an operational footprint in the Kamchatka region in Russia.

• Assessing the adequacy of the disclosure provided in note 1 of the financial statements.Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,individually or collectively, may cast s ignificant doubt on the Group's and the Company's ability to continue as a going concern for aperiod of at least twelve months from when the financial statements are authorised for issue.

In audit ing the financial statements, we have concluded that the Directors' use of the going concern basis ofaccounting in the preparation of the financial statements is appropriate.

However, because not all future events or condit ions can be predicted, this conclusion is not a guarantee as tothe Group's and the Company's ability to continue as a going concern.

Our responsibilit ies and the responsibilit ies of the Directors with respect to going concern are described in therelevant sections of this report.

Report ing on other information

The other information comprises all of the information in the Annual Report other than the financial statementsand our auditors' report thereon. The Directors are responsible for the other information. Our opinion on thefinancial statements does not cover the other information and, accordingly, we do not express an audit opinionor, except to the extent otherwise explicit ly stated in this report, any form of assurance thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, indoing so, consider whether the other information is materially inconsistent with the financial statements or ourknowledge obtained in the audit , or otherwise appears to be materially misstated. If we identify an apparentmaterial inconsistency or material misstatement, we are required to perform procedures to conclude whetherthere is a material misstatement of the financial statements or a material misstatement of the otherinformation. If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report based on theseresponsibilit ies.

With respect to the Strategic Report and Directors' Report, we also considered whether the disclosuresrequired by the UK Companies Act 2006 have been included.

Based on our work undertaken in the course of the audit , the Companies Act 2006 requires us also to reportcertain opinions and matters as described below.

Strategic Report and Directors' Report

In our opinion, based on the work undertaken in the course of the audit , the information given in the StrategicReport and Directors' Report for the year ended 31 December 2020 is consistent with the financial statementsand has been prepared in accordance with applicable legal requirements.

In light of the knowledge and understanding of the Group and Company and their environment obtained in thecourse of the audit , we did not identify any material misstatements in the Strategic Report and Directors'Report.

Responsibilit ies for the financial statements and the audit

Responsibilit ies of the directors for the financial statements

As explained more fully in the Statement of Directors' responsibilit ies in respect of the financial statements, theDirectors are responsible for the preparation of the financial statements in accordance with the applicableframework and for being satisfied that they give a true and fair view. The Directors are also responsible for suchinternal control as they determine is necessary to enable the preparation of financial statements that are freefrom material misstatement, whether due to fraud or error.

In preparing the financial statements, the Directors are responsible for assessing the Group's and the Company'sability to continue as a going concern, disclosing, as applicable, matters related to going concern and using thegoing concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or tocease operations, or have no realist ic alternative but to do so.

Auditors' responsibilities for the audit of the f inancial statements

Our object ives are to obtain reasonable assurance about whether the financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditors' report that includes ouropinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if, individually or in the aggregate, they could reasonably beexpected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularit ies, including fraud, are instances of non-compliance with laws and regulat ions. We design procedures inline with our responsibilit ies, outlined above, to detect material misstatements in respect of irregularit ies,including fraud. The extent to which our procedures are capable of detecting irregularit ies, including fraud, isdetailed below.

Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with laws andregulations related to compliance with UK and Russian tax legis lation and employment law, state and federal laws and regulations andenvironmental legis lation, and we considered the extent to which non-compliance might have a material effect on the financialstatements. We also considered those laws and regulations that have a direct impact on the financial statements such as theCompanies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financialstatements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriatejournal entries to manipulate results and management bias in key accounting estimates. The Group engagement team shared thisrisk assessment with the component audit team so that they could include appropriate audit procedures in response to such risks intheir work. Audit procedures performed by the Group engagement team and/or component audit team included:

• Enquiries of the Directors, management and the Group's legal counsel, including consideration of known orsuspected instances of non-compliance with laws and regulat ions and fraud;

• Inspection of support ing documentation, where appropriate;

• Evaluation of management's controls designed to prevent and detect irregularit ies;

• Review of minutes of meetings of the Board of Directors;

• Challenging assumptions and judgements made by management in relat ion to their significant accountingjudgements and est imates;

• Identifying and test ing journal entries, in part icular any journal entries posted with unusual accountcombinations; and

• Review of re lated work performed by the component audit team, including their responses to risks related to managementoverride of controls and to the risk of fraud in revenue recognition.

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements.Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error,as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collus ion.

Our audit testing might include testing complete populations of certain transactions and balances, possibly us ing data auditingtechniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete populations.We will often seek to target particular items for testing based on their s ize or risk characteristics. In other cases, we will use auditsampling to enable us to draw a conclusion about the population from which the sample is selected.

A further description of our responsibilities for the audit of the financial statements is located on the FRC's website at:www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors ' report.

Use of this report

This report, including the opinions, has been prepared for and only for the Company's members as a body in accordance with Chapter3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assumeresponsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come savewhere expressly agreed by our prior consent in writing.

Other required report ing

Companies Act 2006 exception report ing

Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not obtained all the information and explanations we require for our audit; or

• adequate accounting records have not been kept by the Company, or returns adequate for our audit have notbeen received from branches not visited by us; or

• certain disclosures of Directors' remuneration specified by law are not made; or

• the Company financial statements are not in agreement with the accounting records and returns.

We have no exceptions to report aris ing from this responsibility.

Timothy McAllister (Senior Statutory Auditor)

for and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors London

8 June 2021

Consolidated Statement of Comprehensive Incomefor the year ended 31 December 2020

No te s20 20

$'0 0 02019

$'000

Revenue 4 80,975 63,108

Cost of sales (40,070) (40,300)

Gross prof it 40,905 22,808

Administrative expenses (10,243) (8,755)

Exceptional expenses 5 (1,987) -

Other operating income 811 68

Foreign exchange on operating activities (2,007) 287

Operating prof it 6 27,479 14,408

Finance income 11 30 70

Finance expenses 12 (1,784) (1,642)

Foreign exchange on financing activities 2,317 (241)

Prof it before taxation 28,042 12,595

Income tax on profit 14 (7,781) (3,589)

Prof it f or the f inancial year 20,261 9,006

T otal comprehensive income for the year 20,261 9,006

Total comprehensive income for the year is attributable to: - Owners of the parent company 20,261 9,006

Prof it per share attributable to the owners of the parent company(expressed in cents) - Basic 13 23.25 9.17

- Diluted 13 22.60 9.17

The consolidated statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

The accompanying notes form an integral part of these financial statements.

Consolidated Statement of Financial Positionas at 31 December 2020

No te s

20 20 2019

$'0 0 0 $'0 0 0 $'000 $'000

Non-current assets Intangible assets 16 6,381 3,868

Property, plant and equipment 17 76,314 83,242

Right of use assets 24 729 -

Inventories 20 - 1,370

83,424 88,480

Current assets Inventories 20 16,158 15,357 Trade and other receivables 21 5,063 3,287

Current income tax receivable - 1,497 Cash and cash equivalents 22,400 8,697 43,621 28,838

T otal assets 127,045 117,318

Current liabilit ies Trade and other payables 22 (5,920) (5,981) Current income tax payable (1,459) - Borrowings 23 (8,180) (9,781) Leases 24 (117) - (15,676) (15,762)

Non-current liabilit ies Borrowings 23 (6,969) (15,332) Leases 24 (534) - Provisions 26 (6,628) (1,264) Deferred tax liability 27 (6,154) (6,720) (20,285) (23,316)

T otal liabilit ies (35,961) (39,078)

Net assets 91,084 78,240

Capital and reserves attributable to owners ofthe Company Share capital 28 18,988 18,988

Treasury shares 28 (9,442) (9,442)

Share-based payments reserve 28 1,560 -

Retained earnings 28 79,978 68,694

T otal equity 91,084 78,240


The financial statements were approved by the Board of Directors and authorised for issue on 8 June 2021 and are s igned on itsbehalf by:

Alexander DorogovChief Executive Officer

Company Statement of Financial Positionas at 31 December 2020

No te s

20 20 2019

$'0 0 0 $'0 0 0 $'000 $'000

Non-current assets Investments in subsidiaries 18 73,976 82,950

Current assets Trade and other receivables 21 1,010 2,750 Cash and cash equivalents 117 400 1,127 3,150

T otal assets 75,103 86,100

Current liabilit ies

Trade and other payables 22 (872) (275)

T otal liabilit ies (872) (275)

Net assets 74,231 85,825

Capital and reserves attributable to owners ofthe Company Share capital 28 18,988 18,988

Treasury shares 28 (9,442) (9,442)

Share-based payments reserve 28 1,560 -

Retained earnings 28 63,125 76,279

T otal equity 74,231 85,825


As permitted by s408 Companies Act 2006, the Company has not presented its own income statement and related notes. TheCompany's loss for the year was $4,177,000 (2019: $1,348,000).

The financial statements were approved by the Board of Directors and authorised for issue on 8 June 2021 and are s igned on itsbehalf by:

Alexander DorogovChief Executive Officer

Consolidated Statement of Changes in Equityfor the year ended 31 December 2020

No te s

Sharecapital$'000

Tre asuryshare s$'000

Share -base dpayme nts

re se rve$'000

Re taine de arnings

$'000

To tale quity$'000

Balance at 1 January 2019 18,988 - - 68,199 87,187

Year ended 31 December 2019: Profit and total comprehensive income for theyear - - - 9,006 9,006

Dividends 15 - - - (8,511) (8,511)

Share buyback 28 - (9,442) - - (9,442)

Balance at 31 December 2019 18,988 (9,442) - 68,694 78,240

Year ended 31 December 2020: Profit and total comprehensive income for theyear - - - 20,261 20,261

Dividends 15 - - - (8,977) (8,977)

Share-based payments - - 1,560 - 1,560

Balance at 31 December 2020 18,988 (9,442) 1,560 79,978 91,084


Company Statement of Changes in Equityfor the year ended 31 December 2020

No te s

Sharecapital$'000

Tre asuryshare s$'000


re se rve$'000

Re taine de arnings

$'000

To tale quity$'000

Balance at 1 January 2019 18,988 - - 86,138 105,126

Year ended 31 December 2019: Loss and total comprehensive income for the year - - - (1,348) (1,348)

Dividends 15 - - - (8,511) (8,511)

Share buyback 28 - (9,442) - - (9,442)

Balance at 31 December 2019 18,988 (9,442) - 76,279 85,825

Year ended 31 December 2020: Loss and total comprehensive income for the year - - - (4,177) (4,177)

Dividends 15 - - - (8,977) (8,977)

Share-based payments - - 1,560 - 1,560

Balance at 31 December 2020 18,988 (9,442) 1,560 63,125 74,231


Consolidated Statement of Cash Flowsfor the year ended 31 December 2020

No te s

20 20 2019

$'0 0 0 $'0 0 0 $'000 $'000

Cash f lows f rom operating activit ies Cash generated from operations 31 43,023 26,096

Interest paid (1,811) (1,592)

Income taxes paid (61) (5,562)

Net cash generated f rom operating activit ies 41,151 18,942

Investing activit ies Purchase of intangible assets (2,513) (3,868) Purchase of property, plant and equipment (7,905) (6,084) Proceeds on disposal of property, plant and equipment 12 13 Interest received 30 70

Net cash used in investing activit ies (10,376) (9,869)

Financing activit ies Proceeds from borrowings 12,316 16,317 Repayment of borrowings (20,250) (8,538) Repayment of leases (146) - Dividends paid (8,977) (8,511) Share buyback - (9,442)

Net cash used in f inancing activit ies (17,057) (10,174)

Net increase/(decrease) in cash and cashequivalents 13,718 (1,101)

Cash and cash equivalents at beginning of year 8,697 9,725

Exchange differences on cash and cash equivalents (15) 73

Cash and cash equivalents at end of year 22,400 8,697


Company Statement of Cash Flowsfor the year ended 31 December 2020

No te s

20 20 2019

$'0 0 0 $'0 0 0 $'000 $'000

Cash f lows f rom operating activit ies Cash used in operations 32 (402) (2,130)

Investing activit ies Repayment of loans by subsidiary companies 8,974 14,085 Interest received 120 12

Net cash generated f rom investing activit ies 9,094 14,097

Financing activit ies Share buyback - (9,442) Dividends paid (8,977) (8,511)

Net cash used in f inancing activit ies (8,977) (17,953)

Net decrease in cash and cash equivalents (285) (5,986)

Cash and cash equivalents at beginning of year 400 6,365

Exchange differences on cash and cash equivalents 2 21

Cash and cash equivalents at end of year 117 400


Notes to the Financial Statementsfor the year ended 31 December 2020

1 Accounting policies

1.1 General information

Trans-Siberian Gold plc ("the Company") is a UK-based resources company, with the object ive of acquiring anddeveloping a portfolio of quality gold-mining assets in Russia. The Company is a public limited company,incorporated and domiciled in England and Wales and has three subsidiaries based in the Russian Federation(together, "the Group"), one of which holds the licences for the Asacha (where gold production commenced in2011) and Rodnikova deposits. The Company's registered office is 39 Parkside Cambridge CB1 1PN UnitedKingdom.

The registered number of the Company is 01067991. The Company's shares are traded on the AIM Market of theLondon Stock Exchange.

1.2 Basis of preparation

The principal accounting policies adopted in the preparation of the financial statements are set out below. Thepolicies have been consistently applied to all the years presented, unless otherwise stated.

These financial statements have been prepared in accordance with International Accounting Standards (IAS) inconformity with the requirements of the Companies Act 2006 and International Financial Report ing Standards(IFRS) adopted pursuant to Regulat ion (EC) No 1606/2002 as it applies in the European Union.

The consolidated financial statements are prepared in US dollars ($), rounded to the nearest thousand.

The preparation of financial statements in accordance with IAS and in conformity with the requirements of theCompanies Act 2006, requires management to make judgements, est imates and assumptions that affect theapplicat ion of policies and reported amounts of assets and liabilit ies, income and expenses. The est imates andassociated assumptions are based on historical experience and factors that are believed to be reasonable underthe circumstances, the results of which form the basis of making judgements about carrying values of assetsand liabilit ies that are not readily apparent from other sources. Actual results may differ from these est imates.The areas involving a higher degree of judgement or complexity, or where assumptions and est imates aresignificant to the consolidated financial statements, are disclosed in note 2.

The est imates and underlying assumptions are reviewed on an on-going basis. Revisions to accountingestimates are recognised in the period in which the est imate is revised if the revision only affects that period orin the period of revision and future periods if the revision affects both current and future periods.

Standards, amendments and interpretations ef fective in 2020

A number of new and amended standards and interpretat ions issued by the IASB and endorsed by EuropeanUnion have become effect ive for the first t ime for financial periods beginning on (or after) 1 January 2020 andhave been applied by the Group in these financial statements. None of these new and amended standards andinterpretat ions had a significant effect on the Group because they are either not relevant to the Group'sactivit ies or require accounting which is consistent with the Group's current accounting policies.

Standards, amendments and interpretations that are not yet ef fective and have not been early adopted

There are a number of standards, amendments to standards, and interpretat ions which have been issued by theIASB and endorsed by European Union that are effect ive in future accounting periods and which have not beenadopted early. None of these are expected to have a significant effect on the Group.

1.3 Basis of consolidation

The consolidated financial statements of the Group include the financial statements of Trans-Siberian Gold plcand its subsidiaries. Where the Company has control over an investee, it is classified as a subsidiary. TheCompany controls an investee if all three of the following elements are present: power over the investee,exposure to variable returns from the investee and the ability of the investor to use its power to affect thosevariable returns. Control is reassessed whenever facts and circumstances indicate that there may be a change inany of these elements of control. Subsidiaries are fully consolidated from the date on which control istransferred to the Group. They are de-consolidated from the date on which control ceases. Inter-companytransactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealisedlosses are also eliminated but considered an impairment indicator of the asset transferred. The accountingpolicies and financial year ends of its subsidiaries are consistent with those applied by the Company.

Business combinations

The consolidated financial statements incorporate the results of the business combinations using theacquisit ion method of accounting. In the consolidated statement of financial posit ion, the acquiree's identifiableassets, liabilit ies and contingent liabilit ies are init ially recognised at their fair values at the acquisit ion date. Theresults of acquired operations are included in the consolidated statement of comprehensive income from thedate on which control is obtained.

1.4 Going concern

The Group's operations are cash generative and management t ightly control the level of committed expenditureto ensure that the Group has sufficient resources available to meet its liabilit ies as they fall due. Regular cashforecasts are reviewed to assess the potential impact of factors such as changes in commodity prices,production rates and the t iming of capital expenditure. The Group has reported an operating profit for the yearof $27.5 million, an operating cash inflow of $41.2 million and net increase in cash of $13.7 million. The Directorshave reviewed the Group's cash flow forecast for the period to 31 December 2022 and carried out mult iplescenario analysis of potential downsides including future lockdowns of various length; production, workforce andsupply chain disruptions together with reasonably possible changes in commodity prices; and scheduledrepayments of loan facilit ies. The Directors further stress tested combinations of various scenarios identifyingno significant cash concerns. Based on these analyses, the Directors believe that the Group has sufficientresources to continue in operational existence for the foreseeable future. Furthermore, the Directors haveconsidered the impact of Horvik's acquisit ion discussed in note 35 on the going concern of the Group. In formingtheir opinion the Directors have relied upon the public statements made by Horvik about its future intentions forthe Group, which outline its commercial and financial rat ionale for the acquisit ion. While the Directors are unableto provide surety that such intentions will be enacted, they are not aware of any planned actions which may castdoubt over the Group's future operational existence. The Directors have also considered the change of controlclause within the Company's credit facilit ies with VTB and are comfortable that this does not have an impact onthe going concern status of the Group in light of the Group's cash posit ion and the outstanding loan balance at31 December 2020 and for the reasons outlined in note 23 and note 35. Therefore the Directors believe that theGroup will continue as a going concern and have prepared the financial statements on that basis.

1.5 Revenue

The Company's subsidiary TSG Asacha has entered into contracts for the sale of refined gold and silver, whereby100% of its refined production is sold to Russian bank VTB. Revenue arising from sales under these contracts isrecognised when the price is determinable and the refined gold and silver have been transferred from the TSGAsacha's metal account to VTB in accordance with the terms of the contract at which point the performanceobligation is met.

Revenue is measured based on the consideration to which the Group expects to be entit led under the terms ofa contract with a customer. In most cases the consideration is determined by reference to the gold marketprice at the point of transfer from the metal account. Consideration typically falls due upon delivery.

1.6 Intangible assets

Intangible assets relate to the Group's deferred explorat ion and evaluation expenditure. When the Group incursexpenditure after it has obtained legal rights to explore a specific area but before the technical feasibility andcommercial viability of extract ing a mineral resource are demonstrated, the costs of acquiring the rights to suchmining propert ies and subsequent explorat ion and evaluation costs, including attributable employment costs,

are deferred until the expected recovery of costs is considered probable by the successful exploitat ion or saleof the asset. General overheads are expensed immediately. Depreciat ion on property, plant and equipment usedon explorat ion and evaluation projects is charged to deferred costs whilst the projects are in progress.

Explorat ion and evaluation costs are not amortised.

Where a feasibility study indicates that the future recovery of costs is not probable, full provision is made inrespect of any deferred costs. Where mining propert ies are abandoned, deferred expenditure is written off infull.

Explorat ion expenditure incurred prior to the Group obtaining licencing rights is expensed as incurred.

1.7 Property, plant and equipment

Property, plant and equipment are recorded at historical cost less depreciat ion. Historical cost includesexpenditure that is direct ly attributable to the acquisit ion of the items.

Depreciat ion of property, plant and equipment is calculated using the straight-line method to allocate their costto their residual values over their est imated useful lives, being:

Buildings 3 to 20 yearsPlant and machinery 2 to 12 yearsOffice equipment 3 to 5 years

Motor vehicles 4 to 7 years

Assets in the course of construction are not depreciated.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceedsand the carrying value of the asset, and is recognised in the income statement.

Mining properties

Once the technical feasibility and commercial viability of the project are demonstrated, the capitalisedexplorat ion and evaluation expenditure, other than that on buildings, machinery and equipment, related to thatproject is transferred to tangible assets as mining propert ies.

Mining propert ies are depleted on 'unit of production basis' calculated based on the rat io of gold mined during aperiod to the total volume of gold to be mined based on the est imated commercial resources.

Commercial resources are mineral resources that are considered probable of economic extract ion and includemeasured, indicated and inferred resources. While inferred resources have a lower degree of geologicalcertainty, they are included in the deplet ion calculat ion due to the geology of the ore body which can becharacterised as vein structures - due to the uniform nature of the veins, their presence can be inferred withouthigh concentrat ion of drilling. The effect iveness of this approach has been just ified over t ime, with a highconversion of inferred resource having been extracted already without major deviat ions from forecast.

Changes in commercial resources affect ing unit of production calculat ions are dealt with prospectively over therevised remaining resources.

1.8 Determination of mineral resources

The Group est imates its mineral resources based on information compiled by Competent Persons as defined inaccordance with the 2012 edit ion of the Australasian Code for Report ing of Explorat ion Results, MineralResources and Ore Reserves (the JORC code).

1.9 Non-current investments

In its separate financial statements, the Company recognises investments in subsidiary companies involved inmining operations, explorat ion and development at cost less any provision for impairment.

1.10 Impairment of non-current assets

The carrying amount of the Group's non-current assets is compared to the recoverable amount of the assetswhenever events or changes in circumstances indicate that the net book value may not be recoverable. Therecoverable amount is the higher of value in use and the fair value less costs to sell.

Value in use is est imated by reference to the net present value of expected future cash flows of the relevantcash generating unit . Individual mining propert ies are considered to be separate income generating units for thispurpose, except where they would be operated together as a single mining business.

If the recoverable amount is less than the carrying amount of an asset, an impairment loss is recognised. Therevised carrying amounts are amortised in line with the Group's accounting policy.

A previously recognised impairment loss is reversed if the recoverable amount increases as a result of a reversalof the condit ions that originally resulted in the impairment. The reversal is recognised in the income statementand is limited to the carrying amount that would have been determined, net of depreciat ion, had no impairmentloss been recognised in the prior report ing periods.

1.11 Inventories

Raw materials and consumables, which consist of fuel and materials used in mining operations, spare parts andtools for development act ivit ies are init ially recognised at cost, and subsequently valued at the lower of cost

and net realisable value.

Stockpiles comprise ore containing gold and are valued at the lower of weighted average cost (including directlabour costs and related overheads, allocated on a value/gold content) and net realisable value (using assay datato est imate the amount of gold contained in the stockpiles, adjusted for expected gold recovery rates). Oreextracted is allocated to stockpiles based on est imated grade, with grades below defined cut-off levelstreated as waste and expensed. While held in physically separate stockpiles, the group blends the ore from eachstockpile when feeding the processing plant to achieve the resultant gold content. Ore stockpiles which areblended together or with future ore mined when fed to the plant are assessed as an input to the goldproduction process to ensure the combined stockpiles are carried at the lower of cost and net realisable value.Ore stockpiles which are not blended in production are assessed separately to ensure they are carried at thelower of cost and net realisable value.

The processing of ore in stockpiles occurs in accordance with the Life of Mine ("LoM") processing plan that hasbeen optimised based on the known mineral resources, current plant capacity and mine design. Ore tonnescontained in the stockpile which exceed the annual tonnes to be milled as per the mine plan in the following year,are classified as non-current inventory in the statement of financial posit ion.

Finished goods (comprising refined gold and silver) and work in progress (including gold in circuit and gold dore)are stated at the lower of weighted average cost and net realisable value. Cost includes direct materials, directlabour costs and production overheads, including depreciat ion and deplet ion of relevant property, plant andequipment and mining propert ies. Net realisable value represents the est imated selling price less all expectedcosts to completion and costs to be incurred in selling and distribution.

1.12 Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short term highly liquidinvestments with original maturit ies of three months or less.

1.13 Financial instruments

Financial assets and financial liabilit ies are recognised in the Group statement of financial posit ion when theGroup becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilit iesare only offset and the net amount reported in the consolidated statement of financial posit ion and statementof comprehensive income when there is a currently enforceable legal right to offset the recognised amounts andthe Group intends to sett le on a net basis or realise the asset and liability simultaneously.

Financial assets and financial liabilit ies are init ially measured at fair value. Transaction costs that are direct lyattributable to the acquisit ion or issue of financial assets and financial liabilit ies (other than financial assets andfinancial liabilit ies at fair value through profit or loss) are added to or deducted from the fair value of the financialassets or financial liabilit ies, as appropriate, on init ial recognit ion. Transaction costs direct ly attributable to theacquisit ion of financial assets or financial liabilit ies at fair value through profit or loss are recognised immediatelyin profit or loss.

Financial assets

All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis.Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets withinthe t ime frame established by regulat ion or convention in the marketplace.

All recognised financial assets are measured subsequently in their entirety at either amortised cost or fair value,depending on the classificat ion of the financial assets.

Classif ication of f inancial assets

Financial assets that meet the following condit ions are measured subsequently at amort ised cost using theeffect ive interest rate method:

• The financial asset is held within a business model whose object ive is to hold financial assets in order tocollect contractual cash flows; and,

• The contractual terms of the financial asset give rise on specified dates to cash flows that are solelypayments of principal and interest on the principal amount outstanding.

The Group does not hold any financial assets that meet condit ions for subsequent recognit ion at fair valuethrough profit or loss ("FVTPL") or at fair value through other comprehensive income ("FVTOCI").

Impairment of f inancial assets

The Group recognises a loss allowance for expected credit losses ("ECL") on financial assets that are measuredat amortised cost which comprise mainly trade receivables. The amount of expected credit losses is updated ateach report ing date to reflect changes in credit risk since init ial recognit ion of the respective financialinstrument. The Group always recognises lifet ime ECL on trade receivables. The expected credit losses on thesefinancial assets are est imated using a provision matrix based on the Group's historical credit loss experience,adjusted for factors that are specific to the debtors, general economic condit ions and an assessment of boththe current as well as the forecast direct ion of condit ions at the report ing date, including t ime value of moneywhere appropriate.

Derecognition of f inancial assets

The Group derecognises a financial asset only when the contractual rights to the cash flows from the assetexpire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of theasset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards ofownership and continues to control the transferred asset, the Group recognises its retained interest in theasset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risksand rewards of ownership of a transferred financial asset, the Group continues to recognise the financial assetand also recognises a collateralised borrowing for the proceeds received.

Financial liabilities

The classificat ion of financial liabilit ies at init ial recognit ion depends on the purpose for which the financial liabilitywas issued and its characterist ics. All purchases of financial liabilit ies are recorded on trade date, being the dateon which the Group becomes party to the contractual requirements of the financial liability. Unless otherwiseindicated the carrying amounts of the Group's financial liabilit ies approximate to their fair values. The Group'sfinancial liabilit ies consist only of financial liabilit ies measured at amort ised cost.

Financial liabilities measured subsequently at amortised cost

Financial liabilit ies that are not (i) contingent consideration of an acquirer in a business combination, (ii)held‑for‑trading, or (iii) designated as at FVTPL, are measured subsequently at amort ised cost using theeffect ive interest method. The Group's financial liabilit ies measured at amort ised cost comprise trade and otherpayables, and loans and borrowings. The effect ive interest method is a method of calculat ing the amortisedcost of a financial asset/liability and of allocating interest income/expense over the relevant period. Theeffect ive interest rate is the rate that discounts est imated future cash receipts/payments through theexpected life of the financial asset/liability or, where appropriate, a shorter period.

Derecognition of f inancial liabilities

A financial liability (in whole or in part) is derecognised when the Group has extinguished its contractualobligations, it expires or is cancelled. Any gain or loss on derecognit ion is taken to the statement ofcomprehensive income.

1.14 Equity instruments

Financial instruments issued by the Group are classified as equity only to the extent that they do not meet thedefinit ion of a financial liability or financial asset.

The Group's ordinary shares are classified as equity instruments.

Where the Company purchases its own equity shares (treasury shares), the consideration paid, including anydirect ly attributable incremental costs is deducted from equity attributable to the Company's equity holdersuntil the shares are cancelled or re-issued. Where such ordinary shares are subsequently re-issued, anyconsideration received, net of any direct ly attributable incremental transaction costs, is included in equityattributable to the Company's equity holders.

1.15 Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

Current tax is the expected tax payable or recoverable on the taxable profit or loss for the year, using ratesenacted at the report ing date and any adjustments to the tax payable in respect of previous years.

Deferred tax

Deferred tax is provided in full, using the liability method, on temporary differences arising between the taxbases of assets and liabilit ies and their carrying amounts in the consolidated financial statements. However, thedeferred income tax is not accounted for if it arises from init ial recognit ion of an asset or liability in a transactionother than a business combination that at the t ime of the transaction affects neither accounting nor taxableprofit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted orsubstantively enacted by the report ing date and are expected to apply when the related deferred income taxasset is realised or the deferred income tax liability is sett led.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will beavailable against which the temporary differences can be ut ilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates,except where the t iming of the reversal of the temporary difference is controlled by the Group and it is probablethat the temporary difference will not reverse in the foreseeable future.

Uncertain tax positions

The Group's uncertain tax posit ions are reassessed by management at the end of each report ing period.Liabilit ies are recorded for income tax posit ions that are open to significant judgement and interpretat ion of taxlaws that have been enacted or substantively enacted by the end of the report ing period and which are likely toresult in addit ional taxes being levied if the posit ions were to be challenged by the tax authorit ies. Adjustmentsfor uncertain tax posit ions, other than interest and fines, are recorded within the income tax charge.Adjustments for uncertain tax posit ions in respect of interest and fines are recorded within finance expensesand administrat ive expenses respectively.

1.16 Provisions

Provisions for decommissioning, environmental restorat ion and legal claims are recognised when the Group has apresent legal or constructive obligation as a result of past events, it is probable that an outflow of resources willbe required to sett le the obligation and the amount has been reliably est imated. Provisions are not recognisedfor future operating losses.

Group companies are generally required to restore mine and processing sites at the end of their producing livesto a condit ion acceptable to the relevant authorit ies and consistent with the Group's environmental policies. Theexpected cost of any committed decommissioning or restorat ion programme, discounted to its net presentvalue where the effect of discounting is material, is provided and capitalised at the beginning of each project.The capitalised cost is amort ised over the life of the operation and the increase in the net present value of theprovision for the expected cost is included with interest and similar charges.

The costs of on-going programmes to prevent and control pollut ion and to rehabilitate the environment arecharged to profit or loss as incurred.

1.17 Share-based payments

The Company makes equity-sett led share-based payments to certain Group employees under the terms of itsLTIP scheme (note 30). The fair value of options granted, measured by reference to the grant date fair value, isrecognised as an expense over a vest ing period, with a corresponding increase in equity.

The total amount to be expensed is determined by reference to the fair value of the options granted:

• including any market performance condit ions such as the Company's share price;

• excluding the impact of any service and non-market performance vesting condit ions such as profitability,growth targets and remaining an employee of the Group for a specified t ime period; and

• including the impact of any non-vesting condit ions.

At the end of each report ing period, the Group revises its est imate of the number of options that are expectedto vest based on the non-market vest ing condit ions and service condit ions. It recognises the impact of therevision to original est imates, if any, in the statement of comprehensive income, with a correspondingadjustment to equity.

When the options are exercised, the Company issues new shares or ut ilises exist ing treasury shares. Theproceeds received net of any direct ly attributable transaction costs are credited to equity.

1.18 Leases

The Group accounts for a contract, or a port ion of a contract, as a lease when it conveys the right to use anasset for a period of t ime in exchange for consideration. Leases are those contracts that sat isfy the followingcriteria:

• There is an identified asset;

• The Group obtains substantially all the economic benefits from use of the asset; and,

• The company has the right to direct use of the asset.

The Group considers whether the supplier has substantive substitut ion rights. If the supplier does have thoserights, the contract is not identified as giving rise to a lease. In determining whether the Group obtainssubstantially all the economic benefits from use of the asset, the Group considers only the economic benefitsthat arise from use of the asset. In determining whether the Group has the right to direct use of the asset, theGroup considers whether it directs how and for what purpose the asset is used throughout the period of use. Ifthe contract or port ion of a contract does not sat isfy these criteria, the Group applies other applicable IFRSsrather than IFRS 16.

Lease liabilit ies are measured at the present value of the contractual payments due to the lessor over the leaseterm, with the discount rate determined by reference to the rate inherent in the lease unless this is not readilydeterminable, in which case the Group's incremental borrowing rate on commencement of the lease is used.Variable lease payments are only included in the measurement of the lease liability if they depend on an index orrate. In such cases, the init ial measurement of the lease liability assumes the variable element will remainunchanged throughout the lease term. Other variable lease payments are expensed in the period to which theyrelate.

On init ial recognit ion, the carrying value of the lease liability also includes:

• Amounts expected to be payable under any residual value guarantee;

• The exercise price of any purchase option granted in favour of the Group if it is reasonably certain to assessthat option; and,

• Any penalt ies payable for terminating the lease, if the term of the lease has been est imated based on thetermination option being exercised.

Right of use assets are init ially measured at the amount of the lease liability, reduced for any lease incentivesreceived, and increased for:

• Lease payments made at or before commencement of the lease;

• Init ial direct costs incurred; and,

• The amount of any provision recognised where the group is contractually required to dismantle, remove orrestore the leased asset.

Subsequent to init ial measurement lease liabilit ies increase as a result of interest charged at a constant rate onthe balance outstanding and are reduced for lease payments made. Right-of-use assets are amortised on astraight-line basis over the remaining term of the lease.

When the Group revises its est imate of the term of any lease (because, for example, it re-assesses theprobability of a lessee extension or termination option being exercised), it adjusts the carrying amount of thelease liability to reflect the payments to make over the revised term, which are discounted using a reviseddiscount rate. The carrying value of lease liabilit ies is similarly revised when the variable element of future leasepayments dependent on a rate or index is revised, except the discount rate remains unchanged. In both casesan equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carryingamount being amortised over the remaining (revised) lease term. If the carrying amount of the right-of-useasset is adjusted to zero, any further reduction is recognised in profit or loss.

Short-term leases

Rentals payable under short-term (less than 12 months) low value leases, including any lease incentives received,are charged to profit or loss on a straight line basis over the term of the relevant lease except where anothermore systematic basis is more representative of the t ime pattern in which economic benefits from the leasedasset are consumed.

1.19 Foreign exchangeFunctional and presentation currency

Items included in the financial information of each of the Group's entit ies are measured using the currency of theprimary economic environment in which the entity operates (the functional currency). The consolidated financialinformation is presented in US dollars ($), which is the functional and presentation currency of the Company andthe functional currency of its subsidiaries. The exchange rates on 31 December 2020 were £1:$1.3649 (2019:£1:$1.3210) and $1:RUB73.8757 (2019: $1:RUB61.9057). The average rates applied to transactions during theyear were £1:$1.2837 (2019: £1:$1.2765) and $1:RUB72.3230 (2019: $1:RUB64.6184).

Transactions and balances

Foreign currency transactions are translated into the functional currency at the average exchange rate rulingduring the month in which the transactions occur. Foreign exchange gains and losses result ing from thesett lement of such transactions and from the translat ion at year end exchange rates of monetary assets andliabilit ies denominated in foreign currencies are recognised in profit or loss. Foreign exchange gains and lossesresult ing from the translat ion of cash, cash equivalents and borrowings denominated in foreign currencies areshown as financing act ivit ies; all other foreign exchange gains and losses are shown as operating act ivit ies.

1.20 Borrowing costs

The Group capitalises borrowing costs direct ly attributable to the acquisit ion, construction or production of aqualifying asset (one that takes a substantial period of t ime to get ready for use or sale) as part of the cost ofthat asset. Finance costs incurred in respect of the Group's general borrowings are expensed in profit or loss asincurred.

1.21 Segment reporting

Operating segments are reported in a manner consistent with the internal report ing provided to the chiefoperating decision maker. The chief operating decision maker has been identified as the Chief Executive Officer.

The Group has one operating segment in Russia which has production, explorat ion and development act ivit ies.Its operating results are regularly reviewed by the Group's chief operating decision maker in order to makedecisions about the allocation of resources and to assess its performance. The Group's act ivit ies in the UnitedKingdom are of an administrat ive and corporate nature and do not form part of the operating segment.

2 Judgements and key sources of est imation uncertainty

Estimates and judgements are continually evaluated and are based on historical experience and other factors,including expectations of future events that are believed to be reasonable under the circumstances.

Key sources of estimation uncertainty

The Group makes est imates and assumptions concerning the future. The result ing accounting est imates will, bydefinit ion, seldom equal the related actual results.

The more significant areas requiring the use of management est imates and assumptions relate to mineralresources that are the basis of future cash flow est imates and unit-of-production depreciat ion, deplet ion andamortisat ion calculat ions; decommissioning, site restorat ion, environmental costs and closure obligations;est imates of recoverable gold and other materials; and asset impairments.

The est imates and assumptions that have a significant risk of causing a material adjustment to the carryingamounts of assets and liabilit ies within the next financial year are discussed below:

Mining properties and property plant and equipment

The recoverability of the amounts shown in the Group statement of financial posit ion in relat ion to mining

propert ies and property, plant and equipment (and also the carrying value of the Company's investments in itssubsidiaries) are dependent upon compliance with the terms of the relevant mineral rights licences, extensionsof the terms of those licences beyond their current expiry dates, the polit ical, economic and legislat ive stabilityof the regions in which the Group operates, the Group's ability to maintain the necessary financing to fulfil itsobligations as they arise, the successful extract ion of the defined mineral resources and the future profitableproduction or proceeds from the disposal of propert ies.

Mineral resource estimates

Mineral resource est imates are est imates of the amount of gold that can be economically and legally extractedfrom the Group's mining propert ies. Such resource est imates and their changes may impact the Group'sreported financial posit ion and results, in the following way:

• The carrying value of explorat ion and evaluation assets, mining propert ies and property, plant and equipmentmay be affected due to changes in est imated future cash flows;

• Depreciat ion and amortisat ion charges in the statement of comprehensive income may change where suchcharges are determined using the unit of production method;

• Provisions for rehabilitat ion and environmental provisions may change where resource est imate changes affectexpectations about when such act ivit ies will occur and the associated cost of these act ivit ies.

The Group est imates mineral resources based on information compiled by appropriately qualified CompetentPersons relat ing to the geological and technical data on the size, depth, shape and grade of the ore body andsuitable production techniques and recovery rates. Such an analysis requires complex geological judgements tointerpret the data. The est imation of recoverable resources is based upon factors such as est imates of foreignexchange rates, commodity prices, future capital requirements and production costs, along with geologicalassumptions and judgements made in est imating the size and grade of the ore body.

The Group's minerals resources include measured, indicated and inferred resources. While inferred resourceshave a lower degree of geological certainty, they are included due to the geology of the ore body which can becharacterised as vein structures - due to the uniform nature of the veins, their presence can be inferred withouthigh concentrat ion of drilling. The effect iveness of this approach has been just ified over t ime, with a highconversion of inferred resource having been extracted already without major deviat ions from forecast.

The Group reviews its mineral resource est imates on an annual basis. Similar to previous years, the Group obtainsa JORC (Joint Ore Reserves Committee) compliant mineral resource (not a mineral reserve) statement from athird party. The difference between resources and reserves is the level of confidence of the presence ofeconomically viable minerals. As defined by JORC, resources meet a threshold of having 'reasonable prospects ofeventual economic extract ion'. As the economic assumptions used may change and as addit ional geologicalinformation is produced during the operation of the mine, the est imates of mineral resource may change.

Ore stocks

Stock is valued at the lower of cost or net realisable value. Costs that are incurred in or benefit the productionprocess are accumulated as ore stockpiles, gold in process and gold bullion. Although the quantit ies ofrecoverable metal are reconciled by comparing the grades of ore to the quantit ies of gold and silver actuallyrecovered (metallurgical balancing), the nature of the process inherently limits the ability to precisely monitorrecoverability levels. Net realisable value tests are performed at least annually and represent the est imatedfuture sales price of the product based on contained gold and metals prices, less est imated costs to completeproduction and bring the product to sale. These net realisable tests take into account management's est imateof the maximum values to be realised from ore stockpiles, in some instances through blending of different orestockpile grades, prior to these being added to future processing plant feeds. Judgement is required inassessing whether stockpiles of different grades should be tested individually, or tested as inputs to the goldproduction process, as detailed in the Group's accounting policy.

Decommissioning, site restoration and environmental costs

The Group's mining and explorat ion act ivit ies are subject to various laws and regulat ions governing theprotection of the environment. The Group recognises management's best est imate for asset ret irementobligations in the period in which they are incurred. Actual costs incurred in future periods could differ materiallyfrom the est imates. Addit ionally, future changes to environmental laws and regulat ions, life of mine est imatesand discount rates could affect the carrying amount of this provision. Such changes could similarly impact theuseful lives of assets depreciated on a straight-line-basis, where those lives are limited to the life of mine. Thisis discussed further in note 26.

Critical judgements

The following judgements (apart from those involving est imates) have had the most significant effect onamounts recognised in the financial statements.

Deferred tax

The Group has incurred trading losses in previous periods which give rise to potential deferred tax assets. Therecognit ion of the deferred tax asset is dependent upon the Group making sufficient taxable profits in futureperiods to ut ilise those losses. This is discussed further in note 27.

Uncertain tax positions

The Group's uncertain tax posit ions are reassessed by management at the end of each report ing period.Liabilit ies are recorded for income tax posit ions that are open to significant judgement and interpretat ion of tax

laws that have been enacted or substantively enacted by the end of the report ing period and which are likely toresult in addit ional taxes being levied if the posit ions were to be challenged by the tax authorit ies. During theyear a provision of $5,329,000 has been made in respect of the ambiguity relat ing to certain tax deductionsclaimed by the Group in Russia. While management are of the opinion, based on their interpretat ion of therelevant tax legislat ion, that the tax deductions have been lawfully claimed, it is probable that certain taxposit ions taken by the Group could be challenged by the Russian tax authorit ies. Accordingly, the Group hascreated a provision for the associated taxes. This is discussed further in note 26.

Determination of functional currency

The Group has determined the US dollar as the functional currency of its Russian operating subsidiary TSGAsacha on the basis that it is the currency that influences its sale prices (first primary indicator) and in whichfunds from financing act ivit ies are generated and retained (secondary indicators).

Significant judgement has been exercised in determining the functional currency of TSG Asacha, since thesecondary primary indicator related to the currency influencing TSG Asacha's labour, materials and other costs ofproviding goods or services is the Russian rouble.

3 Segment information

The Group's operations are entirely focused on gold production and explorat ion and development act ivit ieswithin the Russian Federation, with its corporate head office in the UK.

The operating segment has been identified on the basis of internal reports about the components of the Group.

The Group has one reportable segment, being operations in Russia, whose accounting policies are in line withthose set out in note 1. The operating results of this segment are regularly reviewed by the Group's chiefoperating decision maker in order to make decisions about the allocation of resources and to assess theirperformance.

With the exception of UK administrat ive costs amounting to $4,298,000 (2019: $2,117,000), the numbers in theprimary statements reflect the results of the sole operating segment. All revenue arises from the production ofgold with silver as a by-product which is sold to one customer in Russia. All non-current assets are located inRussia.

4 Revenue

20 20$'0 0 0

2019$'000

Revenue analysed by product Gold 79,336 61,257

Silver 1,639 1,851

80,975 63,108

5 Exceptional expensesThe exceptional expenses relate entire ly to the settlement of the Federal Service for Supervis ion of Use of Natural Resources,RosPrirodNadzor's ('RPN') claim over the rates applied by the TSG Asacha in its calculations of payments due for disposal of wastematerials . The claim was disputed by management and was brought before the first instance court who decided in TSG Asacha'sfavour on 4 October 2019. Subsequently, RPN appealed the decis ion and claim settlement in the amount of $1,987,000 was agreed inAugust 2020.

6 Operating profit

20 20$'0 0 0

2019$'000

Operating profit for the year is stated after charging: Exploration expenditure incurred prior to obtaining licencing rights 117 507

Depreciation/depletion of owned property, plant and equipment 12,883 11,999

Depreciation of right of use assets 131 -

Loss on disposal of property, plant and equipment 194 285

Share-based payments 1,560 -

Short-term lease charges 124 272

7 Auditors' remunerationFees payable to the Company's auditors and associates:

20 20$'0 0 0

2019$'000

For audit services Audit of the financial statements of the Group and Company 113 66

Audit of the financial statements of the Company's subsidiaries 122 121

235 187

For other services Taxation compliance services 10 -

All other non-audit services 130 -

140 -

8 EmployeesThe average monthly number of persons (including directors) employed by the Group and Company during the year was:

Gro up Co mpany

20 20Number

2019Numbe r

20 20Number

2019Numbe r

Operations 537 564 - -

Administration 71 135 8 7

608 699 8 7

Their aggregate remuneration comprised:

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Wages and salaries 13,772 13,789 1,556 1,177

Social security costs 3,032 3,189 - -

Share-based payments 1,560 - 1,560 -

18,364 16,978 3,116 1,177

• $540,000 (2019: $nil) of employee costs have been capitalised within intangible assets and $757,000 (2019: $643,000) withinproperty, plant and equipment.

• $533,000 (2019: $837,000) of employee costs were charged to inventories.• Employee benefit expense charged to the statement of comprehensive income amounted to $16,534,000 (2019: $15,498,000).

9 Directors' remuneration

20 20$'0 0 0

2019$'000

Remuneration for qualifying services 3,130 1,033

Remuneration disclosed above includes the following amounts paid to the highest paid director:

20 20$'0 0 0

2019$'000

Remuneration for qualifying services 1,730 568

The following table shows the directors who served during the year or in the previous year together with an analys is oftheir remuneration:

Salary$'000

Fe e s$'000

Bo nus$'000


$'000T o t al 20 20

$'0 0 0To tal 2019

$'000

Executive directors Alexander Dorogov 336 - 473 921 1,730 568

Eugene Antonov 250 - 234 377 861 272

Non-executive directors Charles Ryan - 58 - 50 108 37

Robert Sasson - 58 - 50 108 37

Stewart Dickson - 13 - 112 125 11

Lou Naumovski - 90 - - 90 71

Florian Fenner - 58 - 50 108 37

586 277 707 1,560 3,130 1,033

During the year, management consultancy services have been acquired on an arms length basis from FELDI Limited, of which StewartDickson is a director and a shareholder, for $206,000 (2019: $186,000).

At the reporting date, the Directors serving during the year had the following beneficial interests in the shares of the Company:

Ale xande r

Do ro go vNumbe r

Euge neAnto no vNumbe r

Charle sRyan

Numbe r

Flo rianFe nne r

Numbe r

Ro be rtSasso nNumbe r

S te wartDickso nNumbe r

Shares At 1 January 2019 - - 6,076,306 5,145,792 709,279 -

Additions 229,567 80,249 1,147,841 - 399,999 29,999

Disposals - - - (1,715,264) - -

At 31 December 2019 229,567 80,249 7,224,147 3,430,528 1,109,278 29,999

Additions - - - - - -

Disposals - - - - - -

At 31 December 2020 229,567 80,249 7,224,147 3,430,528 1,109,278 29,999

AlexanderDo ro go v

EugeneAnt o no v

CharlesRyan

Flo rianFenner

Ro bertSasso n

St ewartDickso n

Percentage of total voting rights At 31 December 2020 0.26% 0.09% 8.29% 3.94% 1.27% 0.03%

10 Pension arrangementsThe Group does not provide a pension scheme for its directors or employees (2019: none).

11 Finance income

20 20$'0 0 0

2019$'000

Interest income on short-term bank deposits 30 70

12 Finance expenses

20 20$'0 0 0

2019$'000

Interest payable on borrowings 1,703 1,548

Accretion of decommissioning provision 81 94

1,784 1,642

13 Earnings per shareThe basic earnings per share for the year amounted to 23.25 cents per share (2019: 9.17 cents per share). The diluted earnings pershare for the year amounted to 22.60 cents per share (2019: 9.17 cents per share).

The calculation of basic earnings per 10p ordinary share is based on the retained profit for the year of $20,261,000 (2019:$9,006,000) and on 87,158,508 (2019: 98,291,305) ordinary shares, being the weighted average number of ordinary shares in issue(excluding treasury shares) and ranking for dividends during the year.

Diluted earnings per ordinary share is calculated by adjusting the weighted average number of ordinary shares outstanding toassume convers ion of all dilutive potential ordinary shares. On 5 June 2020 and 27 August 2020 the Company awarded 4,897,988 ofoptions and contingently issuable shares under two new Long Term Incentive Plans ('LTIP') which comprise performance based equityand time restricted equity (note 30). Prior to this , the Company did not have any dilutive potential ordinary shares. The number ofcontingently issuable shares included in the diluted earnings per share calculation is based on the number of shares that would beissuable if the end of the reporting period was the end of the contingency period.

The calculation of diluted earnings per 10p ordinary share is based on the retained profit for the year of $20,261,000 and on89,663,931 ordinary shares, being the weighted average number of ordinary shares in issue (excluding treasury shares) of87,158,508 adjusted for 2,505.423 of contingently issuable shares.

14 Income tax on profit

20 20$'0 0 0

2019$'000

Current tax Current tax - UK Corporation tax - -

Current tax - Russian Corporation tax 8,347 4,164

Adjustments to Russian Corporation tax in respect of prior years - (933)

Total current tax 8,347 3,231

Total current tax 8,347 3,231

Deferred tax Origination and reversal of temporary differences (566) (427)

Adjustments in respect of prior years - 785

Total deferred tax (566) 358

Total tax charge for the year 7,781 3,589

Factors affecting corporation tax for the yearThe tax on the Group's profit before tax differs from the theoretical amount that would arise using the weighted average tax rateapplicable to profits of the consolidated entities as follows:

20 20$'0 0 0

2019$'000

Profit before taxation 28,042 12,595

Expected tax charge based on the UK corporation tax rate of 19.00% (2019: 19.00%) 5,328 2,393

Tax effect of expenses that are not deductible in determining taxable profit 883 220

Effect of overseas tax rates 82 139

Over provided in prior years - (933)

Deferred tax adjustments in respect of prior years - 785

Foreign exchange differences 1,005 730

Unrecognised taxable losses carried forward 483 255

Taxation charge for the year 7,781 3,589

Factors affecting future tax chargeThe main rate of UK corporation tax in the year was 19%. During the year, legis lation was enacted to maintain the corporation tax rateat 19% from 1 April 2021, instead of reducing to 17% as previously announced. On 10 March 2021, the UK government announced thatthe corporation tax rate would increase from 19% to 25% from 1 April 2023. As the legis lation was not substantively enacted at thereporting date, deferred tax balances continue to be recognised at 19%.

15 Dividends

20 20$'0 0 0

2019$'000

Final dividend for 2018 of $0.009 per ordinary share - 784

Interim dividend for 2018 of $0.052 per ordinary share - 5,722

Interim dividend for 2019 of $0.023 per ordinary share - 2,005

Final dividend for 2019 of $0.023 per ordinary share 2,005 -

Interim dividend for 2020 of $0.08 per ordinary share 6,972 -

8,977 8,511

16 Intangible assets

Gro up

De fe rre de xplo ratio n

and e valuatio nco s ts$'000

Cost At 1 January 2019 -

Additions 3,868

At 31 December 2019 3,868

Additions 2,513


Amortisation At 1 January 2020 and 31 December 2020 -

Carrying amount At 31 December 2020 6,381


At 1 January 2019 -

The Company had no intangible assets at 31 December 2020 or 31 December 2019.

Additions in the year relate to the evaluation of the Rodnikova gold deposit and exploration of Vein 25 North ("V25N").

Rodnikova is a high-grade gold and s ilver epithermal deposit located in close proximity to the Company's operating Asacha Gold Mine.

It is estimated to contain 1Moz of gold with an average grade of 5.3g/t. In April 2019 the Federal Agency for Subsoil Use ("Rosnedra")issued a licence to the Company's wholly owned subsidiary TSG Asacha for the development and exploration of the Rodnikovadeposit for a tenure of 20 years.

V25N was discovered in September 2019 following a successful drilling campaign. It is located approximately 400 metres north ofVein 25 within the East Zone of the Company's operating Asacha Gold Mine.

17 Property, plant and equipment

Gro up

Miningpro pe rtie s

$'000Buildings

$'000

Plant andmachine ry

$'000

Officee quipme nt

$'000Mo to r ve hic le s

$'000

Asse ts unde rco ns tructio n

$'000To tal

$'000

Cost At 1 January 2019 88,833 84,415 21,906 419 5,691 1,373 202,637

Additions 2,024 735 307 21 1,895 1,451 6,433

Disposals - (10) (1,184) (47) (26) - (1,267)

Transfers - 389 667 - - (1,056) -

At 31 December 2019 90,857 85,529 21,696 393 7,560 1,768 207,803

Additions 5,579 - 628 26 1,254 173 7,660

Disposals (260) (152) (2,076) (25) (336) - (2,849)

Transfers - - 1,733 - (666) (1,067) -

At 31 December 2020 96,176 85,377 21,981 394 7,812 874 212,614

Depreciation At 1 January 2019 41,403 54,633 11,920 399 2,977 183 111,515

Depreciation charge 5,434 5,255 2,289 16 1,021 - 14,015

Disposals - (10) (899) (47) (13) - (969)

At 31 December 2019 46,837 59,878 13,310 368 3,985 183 124,561

Depreciation charge 5,380 5,038 2,471 15 1,379 - 14,283

Disposals (137) (37) (2,022) (20) (328) - (2,544)

Transfers - - 111 - (111) - -

At 31 December 2020 52,080 64,879 13,870 363 4,925 183 136,300

Carrying amount At 31 December 2020 44,096 20,498 8,111 31 2,887 691 76,314

At 31 December 2019 44,020 25,651 8,386 25 3,575 1,585 83,242

At 1 January 2019 47,430 29,782 9,986 20 2,714 1,190 91,122

The Company had no property, plant and equipment at 31 December 2020 or 31 December 2019.

Bank borrowings are secured over certain property, plant and equipment with the net book value of $13,315,000 as at 31 December2020 (2019: $16,078,874.39) (note 23).

Capitalisation of depreciation and interest• $417,000 (2019: $198,000) of the depreciation charge is included in additions to mining properties.• $nil (2019: $66,000) of the depreciation charge is included in additions to assets under construction.• $984,000 (2019: $1,752,000) of the depreciation and mining properties' depletion charges are included in inventory.• $86,000 (2019: $nil) and $1,000 (2019: $43,000) of interest expense is included within additions to mining properties and assets under

construction respectively.

Mining propertiesMining properties assets relate to the Asachinskoye (Asacha) mining licence held by the Company's subsidiary TSG Asacha.

On 8 September 1994, the Kamchatka Department of the Geological Committee of the Russian Ministry for Natural Resources issueda licence, after tender, to TSG Asacha for the exploration and development of the Asacha minerals deposit in Kamchatka. The licenceincludes the right to extract gold and s ilver and, pursuant to the decis ion of the Federal Agency on Subsoil Use on 12 September2013, its term was extended for five years until 1 September 2018. On 26 June 2018 the Group received a further s ix-yearextension to the licence term until 31 December 2024.

Impairment reviewDuring the year there were no impairment triggers requiring an impairment review under IAS 36 "Impairment of assets".

18 Investments in subsidiaries Gro up Co mpany

No te s20 20

$'0 0 02019

$'00020 20

$'0 0 02019

$'000

Investments in subsidiaries 19 - - 73,976 73,976

Loans to subsidiaries - - - 8,974

- - 73,976 82,950

The loans to subsidiaries were unsecured, bore interest between 6% and 8% and were fully repaid during the year.

Movements in investments in subsidiaries

Inve s tme nts in

subs idiarie s$'000

Lo ans tosubs idiarie s

$'000To tal

$'000

Cost At 1 January 2019 73,976 22,302 96,278

Additions (interest accrued) - 757 757

Repayments - (14,085) (14,085)

At 31 December 2019 73,976 8,974 82,950

Additions (interest accrued) - 113 113

Repayments - (9,087) (9,087)

At 31 December 2020 73,976 - 73,976

Carrying amount At 31 December 2020 73,976 - 73,976

At 31 December 2019 73,976 8,974 82,950

At 1 January 2019 73,976 22,302 96,278

19 SubsidiariesDetails of the Company's subsidiaries at 31 December 2020 are as follows:

Name o funde rtaking

Re gis te re do ffice

Nature o fbus ine ss

Class o fshare s he ld

% He ldDire ct

OOO Trans-SiberianGold Management

Office 1, 45 floor, 12 Vostok tower, Presnenskaya nab,123112 Moscow, Russian Federation

Administration Participatingshares

100

JSC TSG Asacha Office 7, 17 Murmanskaya St, 684000 Yelizovo,Kamchatka Region, Russian Federation

Mining Common shares 100

On 21 April 2021, the Company's wholly owned subsidiary AO Trevozhnoye Zarevo ("TZ") changed its name to Joint-Stock CompanyTSG Asacha ("JSC TSG Asacha" or "TSG Asacha").

On 2 February 2021, the Company incorporated a new subsidiary company in Russia, OOO Rodnikovoe, of which it owns 100% of theparticipating interest. Rodnikovoe's primary activity is to develop and mine Rodnikova gold deposit (note 16).

20 Inventories

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Non-current: Ore stocks - 1,370 - -

- 1,370 - -

Current: Gold in progress 1,786 1,666 - -

Silver in progress 199 76 - -

Ore stocks 8,062 4,926 - -

Raw materials and consumables 6,111 8,689 - -

16,158 15,357 - -

16,158 16,727 - -

Finished s ilver, gold in progress, s ilver in progress and ore stocks include mining properties depletion $984,000 (2019: $1,752,000).

21 Trade and other receivables

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Trade receivables - 163 - -

Receivables from subsidiary companies - - 651 2,681

Other receivables 1,774 1,149 61 13

Prepayments 3,289 1,975 298 56

5,063 3,287 1,010 2,750

Amounts receivable from subsidiary companies in the prior year included a short-term loan of $1,361,000. This loan was unsecured,bore no interest and was fully repaid during the year. The remaining amounts receivable from subsidiary companies representtrading balances, are interest free, unsecured and repayable on demand.

22 Trade and other payables

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Trade payables 2,360 2,716 595 135

Amounts due to subsidiary companies - - 35 42

Social security and other taxes 944 21 - -

Other payables 2,374 3,146 - -

Accruals 242 98 242 98

5,920 5,981 872 275

Amounts due to subsidiary companies are unsecured, interest free and repayable on demand.

23 Borrowings

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Current: Bank borrowings 7,765 9,502 - -

Equipment loans 415 279 - -

8,180 9,781 - -

Non-current: Bank borrowings 5,410 13,432 - -

Equipment loans 1,559 1,900 - -

6,969 15,332 - -

15,149 25,113 - -

Movement in borrowings is analysed as follows:

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

At 1 January 25,113 17,093 - -

Proceeds from bank borrowings 11,806 13,683 - -

Repayment of bank borrowings and accrued interest (19,968) (8,027) - -

Proceeds from equipment loans 510 2,634 - -

Repayment of equipment loans and accrued interest (312) (511) - -

Foreign exchange on financing activity (2,000) 241 - -

At 31 December 15,149 25,113 - -

Bank borrowingsOn 29 May 2020, the Group's wholly owned subsidiary TSG Asacha entered into an agreement with VTB Bank for a $10 millionrevolving credit line for a period of 3 years. The new facility replaced the existing $5 million credit line which expired on 20 June 2020and will provide additional working capital and short-term liquidity for the Group.

The interest rate on the new facility has been reduced from 6.2% to 5.2% per annum. The credit agreement retains customaryrepresentations and warranties from TSG Asacha to VTB and is secured against the equity and fixed assets of TSG Asacha. Certainamounts drawn down under the credit line must be repaid within one year. TSG Asacha also retains its obligation to sell goldexclusively to VTB Bank.

Furthermore, the Credit Committee of VTB agreed to lower the current interest rate on a separate existing Russian rouble-denominated credit line, which was provided to TSG Asacha in 2019 for a 4-year term at an annual interest rate of 10.7%. A floatinginterest rate is now set on this existing facility, calculated as 2.2% over the lending rate of the Russian Central Bank. At 31 December2020 the outstanding balance on this facility amounted to RUB458 million (approximately $6.2 million). The facility is secured againstmining properties and buildings of TSG Asacha.

The credit facilities with VTB bank contain a protective clause permitting the lender to require early repayment of the loan if, as aresult of a change in the Company's controlling beneficiary owners, circumstances exist which may imply that the credit facility maynot be repaid. On the basis that the Group is in a net cash position, it can repay the loan at any time should it be called upon. Earlyrepayment has not been requested by VTB. This coupled with the fact that VTB bank is also the financial adviser to Horvik andintends to finance the cash consideration payable by Horvik to TSG's shareholders (note 35) us ing debt to be provided under a

facilities agreement between VTB bank and Horvik, the Directors are of the opinion that VTB bank will not request early repaymentfollowing Horvik's acquis ition.

Equipment loansTSG Asacha entered into 8 separate equipment loans with AO VTB Leasing for the total amount of RUB 206 million ($3.1 million) tofinance the acquis ition of certain heavy machinery and equipment. The loans are for a period from 3 to 5 years, secured over therespective acquired assets and bear average annual effective interest rate of 14%.

The effective interest rate is determined by discounting future payments through the life of the loan. The future payments includeinterest as well as arrangement fees and asset insurance.

24 Leases

Gro upOf f ice lease

$'000

Right of use assets At 1 January 2020 -

Additions in the year 860

Amortisation (131)

At 31 December 2020 729

Gro upT o t al$'0 0 0

Lease liabilit ies At 1 January 2020 -

Additions in the year (860)

Lease payments made 146

Unwinding of a discount (44)

Foreign exchange 107

At 31 December 2020 (651)

Current (117)

Non-current (534)

(651)

Leases relate entire ly to the 5-year office rent agreement entered into in February 2020.

25 Financial instrumentsThe Group is exposed through its operations to the following financial risks: liquidity risk, credit risk, cash flow interest rate risk,commodity price risk and foreign exchange risk. The Board seeks to minimise the Group's exposure to those risks by reviewing andagreeing policies for managing each financial risk and monitoring them on a regular basis . No formal policies have been put in placein order to hedge the Group's activities to the exposure to interest risk, commodity price risk or currency risk, however these maybe considered in future. No derivatives or hedges were entered into during the year.

There have been no substantive changes in the Group's exposure to financial instrument risks, its policies and processes formanaging those risks or the methods used to measure them unless otherwise stated in this note.

Principal f inancial instrumentsThe Group's principal financial instruments, from which financial instrument risk arises, comprise long and short-term loans, cash andshort-term deposits as well as trade and other receivables and trade and other payables which arise directly from its operations.

The table below shows the carrying value of the Group's financial assets and financial liabilities.

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Carrying amount of f inancial assets Trade and other receivable 304 277 654 11,658

Cash and cash equivalents 22,400 8,697 117 400

Carrying amount of f inancial liabilit ies Measured at amortised cost 18,402 28,107 872 275

Liquidity riskThe Group's policy is to ensure that it has sufficient cash to allow it to meet its liabilities when they become due. Cash forecastsidentifying the Group's funding and liquidity requirements are reviewed regularly by the Board.

The contractual maturities of the Group's financial liabilities (which are all carried at amortised cost) are shown in the table below:

Gro up2020

Carryingamo unt

$'0 0 0

Co nt ract ualcash f lo ws

$'0 0 0

6 mo nt hso r less$'0 0 0

6 t o 12mo nt hs

$'0 0 0

12 t o 60mo nt hs

$'0 0 0

Current f inancial liabilit ies: Trade and other payables 2,602 2,602 2,602 - -

Loans and borrowings 8,167 8,167 4,619 3,548 -

Interest 13 636 364 272 -

Leases 117 117 59 58 -

Non-current f inancial liabilit ies: Loans and borrowings 6,969 6,969 - - 6,969

Interest - 466 - - 466

Leases 534 534 - - 534

18,402 19,491 7,644 3,878 7,969

Co mpany2020

Carryingamo unt

$'0 0 0

Co nt ract ualcash f lo ws

$'0 0 0

6 mo nt hso r less$'0 0 0

6 t o 12mo nt hs

$'0 0 0

12 t o 60mo nt hs

$'0 0 0

Current f inancial liabilit ies: Trade and other payables 872 872 872 - -

Gro up2019

Carryingamo unt

$'000

Co ntractualcash flo ws

$'000

6 mo nthso r le ss

$'000

6 to 12mo nths

$'000

12 to 60mo nths

$'000

Current f inancial liabilit ies: Trade and other payables 2,994 2,994 2,994 - -

Loans and borrowings 9,683 9,683 5,121 4,562 -

Interest 98 750 424 326 -

Non-current f inancial liabilit ies: Loans and borrowings 15,332 15,332 - - 15,332

Interest - 2,909 566 566 1,777

28,107 31,668 9,105 5,454 17,109

Co mpany2019

Carryingamo unt

$'000

Co ntractualcash flo ws

$'000

6 mo nthso r le ss

$'000

6 to 12mo nths

$'000

12 to 60mo nths

$'000

Current f inancial liabilit ies: Trade and other payables 275 275 275 - -

Credit riskThe credit risk on liquid funds is limited because the counterparties are banks with credit ratings ass igned by international creditrating agencies. The Company has made investments in and loans to one of its subsidiaries, recovery of which is dependent on thefuture income generation of that subsidiary.

The Group and Company's maximum exposure to credit risk by class of individual financial instrument is shown in the table below:

Gro up

20 20 2019

Carryingvalue$'0 0 0

Maximumexpo sure

$'0 0 0

Carryingvalue

$'000

Maximume xpo sure

$'000

Current f inancial assets: Trade and other receivables 304 304 277 277

Cash and cash equivalents 22,400 22,400 8,697 8,697

22,704 22,704 8,974 8,974

Co mpany

20 20 2019

Carryingvalue$'0 0 0

Maximumexpo sure

$'0 0 0

Carryingvalue

$'000

Maximume xpo sure

$'000

Current f inancial assets: Trade and other receivables - - 3 3

Loans to subsidiaries 654 654 2,681 2,681

Cash and cash equivalents 117 117 400 400

Non - current f inancial assets:

Loans to subsidiaries - - 8,974 8,974

771 771 12,058 12,058

Cash f low interest rate riskThe Group is exposed to cash flow interest rate risk from its deposits of cash and cash equivalents with banks. The cash balancesmaintained by the Group are managed in order to ensure that the maximum level of interest is received for the available funds butwithout affecting working capital flexibility.

With the exception of the RUB458 million (approximately $6.2 million) Russian rouble loan facility, all of the other Group's borrowingsare issued at fixed rates and do not expose the Group to cash flow interest rate risk.

The RUB458 million Russian rouble loan facility bears a floating interest rate calculated as 2.2% over the lending rate of the RussianCentral Bank which was 4.25% at the reporting date. A 1% increase/decrease in the Russian Central Bank's rate willdecrease/increase the Group's profit by $59,000.

The interest rate profile of the Group and Company's financial assets and liabilities at the reporting date was as follows:

Cash

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

US dollars Fixed rate 286 8,100 - -

US dollars Non-interest bearing 20,667 114 112 -

Sterling Non-interest bearing 4 338 4 338

Russian roubles Fixed rate 1,029 49 - -

Russian roubles Non-interest bearing 414 96 1 62

22,400 8,697 117 400

Loans

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Russian roubles Floating rate - 6.45% (2019: Fixed rate - 10.70%) 6,819 9,710 - -

Russian roubles Fixed rate - 14% (2019: Fixed rate - 15.72%) 1,974 2,179 - -

US dollars Fixed rate - 5.2% (2019: Fixed rate - 6.2%) 6,343 13,126 - -

15,136 25,015 - -

The weighted average interest rate payable during the year was 5.2% (2019: 6.2%) on US dollar loans and 8.1% (2019: 11.62%) onRussian rouble loans.

The weighted average interest rates earned during the year were 0.0% (2019: 0.0%) on floating rate sterling cash balances, 0.10%(2019: 0.10%) on floating rate US dollar balances and 5.5% (2019: 5.5%) on floating rate Russian rouble balances.

At the year end, the Group had cash on overnight deposit. Short-term deposits during the year included overnight, one-week andone-month notice periods.

Commodity price riskBy the nature of its activities the Group is exposed to fluctuations in commodity prices and, in particular, the price of gold as thesecould affect its ability to raise further finance in the future, its future revenue levels and the viability of its projects. The Group doesnot currently hold any financial instruments to hedge the commodity price risk on its expected future production. The Board will keepthis exposure under review, taking account of the extent to which the commodity price risk can be hedged and other factors includingproduction risks and the costs of the hedge programme.

Foreign currency riskThe Group reports in US dollars and conducts most of its business in dollars and Russian roubles. It also conducts businessin sterling.

The table below shows the extent to which Group companies have monetary assets and liabilities in currencies other than theirfunctional currency.

31 December 20 20 31 De ce mbe r 2019

RUB$'0 0 0

GBP$'0 0 0

RUB$'000

GBP$'000

Trade and other receivables 304 - 274 3

Trade and other payables (1,765) (837) (2,761) (233)

Cash 1,442 4 66 -

(19) (833) (2,421) (230)

Ef fect on prof it of changes in exchange ratesNet foreign exchange gains totalling $310,000 (2019: $46,000) have been recognised in the statement of comprehensive income forthe year. The exchange gains principally reflect the impact of the depreciation of the Russian rouble on the Group's Russian roubledenominated monetary items.

The table below shows the impact of changes in exchange rates on the result and financial position of the Group:

31 December 20 20 31 De ce mbe r 2019

RUB$'0 0 0

GBP$'0 0 0

RUB$'000

GBP$'000

10% increase in exchange rate 2 76 220 21

10% decrease in exchange rate (2) (93) (269) (25)

Fair values of the Group's and Company's f inancial liabilities and assetsThe fair value of the Group's long-term borrowing (which is US dollar fixed rate debt) and provis ions are shown at their carryingvalues as any differences are not material. The fair value of the Group's and the Company's short-term borrowing, cash and cashequivalents equates to their carrying value because of the short maturity of these instruments. The fair values of the Group's andthe Company's trade and other payables and trade and other receivables are not s ignificantly different from their carrying values.The fair values have been calculated by discounting expected cash flows at prevailing interest rates and by applying year endexchange rates.

Capital risk managementThe Company is not required to comply with any externally imposed capital requirements. The Company's Russian subsidiaries arerequired to maintain net asset values equal to or above their share capital. In previous years the Company has made additionalcapital contributions to its subsidiaries through the forgiveness of loans in order to correct negative equity positions in thosesubsidiaries ' local accounts.

The Group's primary objective when managing capital is to ensure that there is sufficient capital available to support the Group'sfunding requirements, including capital expenditure, in a way that optimises the cost of capital, maximises shareholders ' returns andensures the Group's ability to continue as a going concern. There were no changes to the Group's capital management approachduring the year.

The Group may make adjustments to the capital structure as opportunities arise, as and when borrowings mature or as and whenfunding is required. This may take the form of rais ing equity, debt finance, equipment supplier credits or a combination thereof.

The Group monitors capital on the basis of the gearing ratio, which is defined as net debt divided by total capital. Net debt iscalculated as total borrowings (including current and non-current borrowings as shown in the consolidated statement of financialposition) less cash and cash equivalents.

Total capital is calculated as equity as shown in the consolidated statement of financial position plus net debt. While the Group doesnot set absolute limits on the ratio, the Group believes that optimally it should remain below 25%. The Company's policy in respect ofcapital risk management is the same as that of the Group.

The gearing ratios at 31 December 2020 and 2019 were as follows:

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Total borrowings 15,149 25,113 - -

Less: cash and cash equivalents (22,400) (8,697) (117) (400)

Net debt (7,251) 16,416 (117) (400)

Total equity 91,084 78,240 74,231 85,825

Total capital 83,833 94,656 74,114 85,425

Gearing ratio (8.65)% 17.34% (0.16)% (0.47)%

26 Provisions

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Environmental/site restoration provision 1,299 1,264 - -

Uncertain tax provisions 5,329 - - -

6,628 1,264 - -

Movements in provisions

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

At 1 January 1,264 1,008 - -

Additional provisions in the year 5,329 - - -

Liability adjustment 163 34 - -

Unwinding of discount 81 94 - -

Exchange difference (209) 128 - -

At 31 December 6,628 1,264 - -

During the year a provis ion of $5,329,000 has been made in respect of the ambiguity relating to certain tax deductions claimed bythe Group in Russia. While management are of the opinion, based on their interpretation of the relevant tax legis lation, that the taxdeductions have been lawfully claimed, it is probable that certain tax positions taken by the Group could be challenged by the Russiantax authorities. Accordingly, the Group has created a provis ion for the associated taxes. The balance at 31 December 2020 isexpected to be either fully utilised or re leased when the inspection rights of the tax authorities with respect to the relevant taxreturns expire.

The environmental/s ite restoration provis ion relates to the s ite restoration at the Asacha mine, which is expected to commence in

2027. The provis ion is estimated based on the regional data from the Monitoring Ecological Centre of Kamchatka.

27 Deferred taxationThe following are the major deferred tax liabilities and assets recognised by the Group and movements thereon:

Group20 20

$'0 0 02019

$'000

Liability: Accelerated capital allowances 6,505 6,889

Asset: Tax losses (39) (43)

Asset: Other provisions (312) (126)

Net deferred tax liabilities 6,154 6,720

Net deferred tax liabilities to be recovered after more than 12 months 6,489 6,720

Net deferred tax assets to be recovered within 12 months (335) -

6,154 6,720

The Company has no deferred tax assets or liabilities.

Gro up Gro up Co mpany Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Movements in the year: Net liability at 1 January 6,720 6,362 - -

(Credited)/charged to statement of comprehensive income (566) 358 - -

Net liability at 31 December 6,154 6,720 - -

Deferred tax assets are recognised for tax losses carried forward to the extent that the realisation of the relevant tax benefitthrough future taxable profits is probable.

As at 31 December 2020, the Company had unrecognised tax losses carried forward with a tax value, at the standard rate ofcorporation tax in the UK of 19%, of $2,837,000 (2019: $2,400,000).

The subsidiaries in Russia had recognised tax losses carried forward with a tax value, at the standard rate of corporation tax inRussia of 20%, of $39,000 (2019: $43,000).

28 Share capital and reserves

Gro up and Co mpany

20 20Number

2019Numbe r

Authorised Ordinary shares of 10p each 150,000,000 150,000,000

Gro up and Co mpany

20 20$'0 0 0

2019$'000

Issued and fully paid 87,158,508 (2019: 87,158,508) ordinary shares of 10p each 18,988 18,988

On 12 July 2019 the Company completed a share buy back from two of its major shareholders within UFG Asset Management ("UFG")and bought back 22,894,565 of its existing ordinary shares by means of an off-market share buyback transaction at a price of 33pence per share, representing a discount of 42% to the clos ing middle market price of a TSG ordinary share on 1 May 2019, for anaggregate purchase price of £7.56 million ($9.44 million) (the "Buyback").

The Buyback was funded out of the Company's existing distributable profits , facilitated by the repayment of intra-group indebtednessby the Company's wholly owned subsidiary, TSG Asacha, utilis ing a loan facility obtained by TSG Asacha from VTB Bank (note 23).

At the reporting date the Company had 87,158,508 ordinary shares in issue and held 22,894,565 ordinary shares in treasury.

Subsequently to the year end, in February 2021 the Company announced a further share buyback and in March 2021 a recommendedpre-conditional mandatory cash offer for the Company, refer to note 35.

Reserves def initionShare capitalShare capital represents amounts subscribed for share capital at nominal value.

Treasury sharesWeighted average cost of own shares held in treasury.

Share-based payments reserveShare-based payments reserve relates to the fair value of the share options that have been charged to the statement ofcomprehensive income in line with IFRS 2 'Share-based payment' requirements.

Retained earningsRetained earnings represents the cumulative net gains and losses recognised in the statement of comprehensive income less anyamounts reflected directly in other reserves.

29 CommitmentsShort-term lease commitmentsThe Group leases various property, plant and machinery under short-term cancellable lease agreements. The lease expenditurecharged to profit or loss during the year is disclosed in note 6.

At the reporting end date the Group had outstanding commitments for future minimum lease payments under non-cancellable leases,which fall due as follows:

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Within one year 86 161 - -

86 161 - -

Lease payments are effected by equal monthly instalments. Leased equipment may only be used at the Asacha mine. Leased landand buildings includes property in Moscow and Kamchatka.

Capital commitmentsAt the reporting date the Group had $4,624,000 of non-cancellable capital commitments related to the Asacha mine(2019: $2,825,000).

30 Share-based payment transactionsOn 8 June and 28 August 2020 the Company announced two Long Term Incentive Plans (the "LTIP" or the "Scheme") whose objectiveis the sustained alignment of interests between directors and shareholders to deliver long-term growth in shareholder value. Prior tothis , there were no options or warrants in existence. On 5 June 2020, the Company granted 3,597,988 of contingently issuable sharesto its executive directors under the LTIP which comprise performance based equity and time restricted equity.

On 27 August 2020 a further 1,300,000 of contingently issuable share options were granted to four non-executive directors with anexercise price of 10 pence per share and comprise performance based equity and time restricted equity.

Group and company

Numbe r o f share o ptio nsWe ighte d ave rage e xe rc ise

price

20 20Number

2019Numbe r

20 20£

2019£

Outstanding at 1 January - - - -

Granted on 5 June 2020 3,597,988 - - -

Granted 27 August 2020 1,300,000 - 0.10 -

Expired - - - -

Outstanding at 31 December 4,897,988 - 0.03 -

Exercisable at 31 December - - - -

The options outstanding at 31 December 2020 had an exercise price ranging from £nil to 10 pence per share, and a remainingcontractual life between 6 months and 30 months.

As a result of completion of Horvik acquis ition on 26 May 2021 (note 35), all awards granted under the Company's Long TermIncentive Plans vested under the change of control provis ions in the LTIP's rules. The awards were settled by the Companytransferring 4,787,816 of its shares out of treasury.

Group and companyThe fair value of the options granted in the year was determined using a Monte Carlo s imulation model and ranged between $0.77per option and $1.40 per option. The s ignificant inputs in the model were as follows:

20 20 2019

Weighted average share price ($) 0.86 -

Weighted average exercise price ($) - -

Expected volatility (%) 52.00 -

Number of simulations 10,000.00 -

Expected dividends yields (%) 1.97 -

Gro up Co mpany

20 20$'0 0 0

2019$'000

20 20$'0 0 0

2019$'000

Expense recognised in the year Arising from equity settled share based payment transactions 1,560 - 1,560 -

31 Cash generated from Group's operations

20 20$'0 0 0

2019$'000

Profit for the year after tax 20,261 9,006

Adjustments for: Taxation charged 7,781 3,589

Finance expenses 1,784 1,642

Finance income (30) (70)


Unrealised foreign exchange differences (2,266) 290

Depreciation of property, plant and equipment 12,883 11,999

Depreciation of right of use assets 131 -


Movements in working capital: Decrease/(increase) in inventories 1,552 (402)

Increase in trade and other receivables (766) (1,057)

(Decrease)/increase in trade and other payables (61) 814

Cash generated f rom operations 43,023 26,096

32 Cash used in Company's operations

20 20$'0 0 0

2019$'000

Loss for the year after tax (4,177) (1,348)

Adjustments for: Finance income (120) (769)

Unrealised foreign exchange differences (9) (16)

Equity settled share based payment expense 1,560 -

Movements in working capital: Decrease/(increase) in trade and other receivables 1,740 (107)

Increase in trade and other payables 604 110

Cash used in operations (402) (2,130)

33 Related party transactionsThe directors of the Company consider that there are no key management personnel, as defined by IAS 24, Related partytransactions, other than the directors themselves.

Directors ' emoluments and their beneficial interests in the ordinary shares of the Company are detailed in note 9.

Transactions between the Company and its subsidiaries and between those subsidiaries include technical, management and otherservices and loans as detailed below:

Purchases(Sales)

20 20$'0 0 0

Balance at31 December

20 20$'0 0 0

Purchase s(Sale s )

2019$'000

Balance at31 De ce mbe r

2019$'000

Nature of transaction T rans-Siberian Gold Plc Technical services - 651 - 1,317

Other services - (35) - (42)

Loan interest (113) - (757) 5,864

Loans - - - 4,473

(113) 616 (757) 11,612

OOO T rans-Siberian Gold Management Management services (1,964) 119 (1,806) 106

Other services - 35 - 42

(1,964) 154 (1,806) 148

JSC T SG Asacha Technical services - (651) - (1,317)

Management services 1,964 (119) 1,806 (106)

Loan interest 113 - 757 (5,864)

Loans - - - (4,473)

2,077 (770) 2,563 (11,760)

Total - - - -

During the year, management consultancy services have been acquired from FELDI Limited, of which Stewart Dickson is director andshareholder, for $206,000 (2019: $186,000). At the reporting date $nil was owed to FELDI Limited (2019: $12,000). These serviceshave been provided at arm's length basis .

During the year, $175,000 (2019: $150,000) was paid to UFG Asset Management under the terms of the shareholders ' re lationshipagreement entered into on 28 November 2019 between the Company and certain entities of UFG Asset Management.

There were no other related party transactions.

34 Ultimate controlling partyAt the reporting date the ultimate control of the Company was with the individual investors in certain funds of UFG AssetManagement. No one investor was considered to be the ultimate controlling party.

Following Horvik's acquis ition discussed in note 35, as at the date of this document, Horvik Limited is beneficially interested inapproximately 48.6% of the issued share capital of TSG (excluding shares held in treasury). Horvik is required under Rule 9 of theCity Code on Takeovers and Mergers to make an offer for the TSG Shares not already held or agreed to be acquired by Horvik. Theoffer document containing the terms of the Offer will be posted to TSG Shareholders as soon as practicable and in any event by 16June 2021.

35 Events after the reporting dateOn 18 March 2021, the Company announced a recommended pre-conditional mandatory cash offer to be made by Horvik Limited("Horvik") for the Company and that Horvik had agreed to acquire 44,558,918 of the Company's ordinary shares, representingapproximately 51.2 per cent. of the Company's issued share capital (excluding any shares held in treasury), from a group of theCompany's shareholders (the "selling shareholders") (the "acquis ition").

In the first stage of the acquis ition Horvik acquired 21,437,000 of the Company's ordinary shares, representing 24.7 per cent. of theCompany's issued share capital (excluding any shares held in treasury) pro rata from each of the selling shareholders. Theacquis ition of the remaining 23,121,918 Company's ordinary shares from the selling shareholders was conditional upon Horvikreceiving clearance from the Russian Federal Antimonopoly Service which was granted to Horvik on 19 May 2021 resulting in the pre-condition to the offer being satis fied.

On 26 May 2021, Horvik completed the acquis ition of the remaining 23,121,918 Company's shares, representing approximately 26.6per cent. of the issued share capital of the Company (excluding any shares held in treasury). As a result, Horvik held 44,558,918 ofthe Company's shares, representing approximately 51.2 per cent. of the issued share capital of the Company (excluding any sharesheld in treasury).

As a result of completion of the acquis ition, the awards granted under the Company's Long Term Incentive Plan (note 30) to executiveand non-executive directors vested under the change of control provis ions in the LTIP's rules. The awards were settled by theCompany transferring 4,787,816 of its shares out of treasury. Following the LTIP's settlement, Horvik's shareholding in the Companywas diluted from approximately 51.2% of the Company's issued share capital (excluding shares held in treasury) to approximately48.6% of the Company's issued share capital (excluding shares held in treasury).

Under the terms of the offer, the Company's shareholders will receive £1.18 in cash for each ordinary share of the Company, whichvalues the Company's entire issued and to be issued share capital at approximately £108,253,043.

The terms of the offer represent a premium of approximately:

• 18 per cent. to the clos ing price per Company's ordinary share of £1.00 on 17 March 2021 (being the last practicable date prior tothe date of the offer announcement);

• 34 per cent. premium to the clos ing price per Company's ordinary share of £0.88 on 4 March 2021 (being the last Business Dayprior to the date on which Horvik first approached the Company's Independent Directors); and

• 26 per cent. to the volume weighted average clos ing price per Company's ordinary share of £0.94 for the one month period endedon 17 March 2021 (being the last practicable date prior to the date of the offer announcement).

The credit facilities with VTB bank (note 23) contain a protective clause permitting the lender to require early repayment of the loanif, as a result of a change in the Company's controlling beneficiary owners, circumstances exist which may imply that the credit facilitymay not be repaid. On the basis that the Group is in a net cash position, it can repay the loan at any time should it be called upon.Early repayment has not been requested by VTB. This coupled with the fact that VTB bank is also the financial adviser to Horvik andintends to finance the cash consideration payable by Horvik to TSG's shareholders us ing debt to be provided under a facilitiesagreement between VTB bank and Horvik, the Directors are of the opinion that VTB bank will not request early repayment followingHorvik's acquis ition.

On 21 April 2021, the Company's wholly owned subsidiary AO Trevozhnoye Zarevo ("TZ") changed its name to Joint-Stock CompanyTSG Asacha ("JSC TSG Asacha" or "TSG Asacha").

On 26 February 2021, the Company initiated a share buyback programme to purchase the Company's ordinary shares for anaggregate amount of £1 million ("buyback amount"). The programme, which was to be undertaken until the earlier of the buybackamount being reached and the Company's Annual General Meeting in 2021, resulted in the repurchase of 206,457 ordinary shares,now held in treasury.

On 2 February 2021, the Company incorporated a new subsidiary company in Russia, OOO Rodnikovoe, of which it owns 100% of the

participating interest. Rodnikovoe's primary activity is to develop and mine Rodnikova gold deposit.

On 6 January 2021, the Group reported two fatalities at its Asacha Gold mine which resulted in immediate suspension of all miningoperations at Vein 25 for a period of 2 months until a full investigation by the Company and local authorities was completed. In March2021 the full permiss ion was granted by the Federal Service for Environmental, Technological and Nuclear Supervis ion("Rostekhnadzor") for the Group to recommence mining operations at Vein 25. Mining operations at the Main Zone and the processingunit continued uninterrupted during the investigation period.

36 Non-GAAP MeasuresThe Group uses certain measures in this report that are not defined under IFRS. Non-GAAP financial measures are provided asadditional information to investors to ass ist them with their assessment of the Group's financial position and its operating results .These measures are not in accordance with, or a substitute for, IFRS, and may be different from or inconsistent with non-GAAPfinancial measures used by other companies. These measures are explained further below:

Cash costsCash costs are calculated on a consolidated basis and include all costs absorbed into cost of sales, excluding mining tax, depreciation,amortisation and depletion, net of by-product revenue (s ilver). Cash costs per ounce of gold sold is calculated by dividing theaggregate of these costs by total ounces sold.

20 20$'0 0 0

2019$'000

Cost of sales 40,070 40,300

Adjustments for: By-product revenue (silver) (1,639) (1,851)

Mining tax (2,330) (4,330)

Depreciation/depletion of property, plant and equipment included within cost of sales (12,559) (11,677)

Cash Cost 23,542 22,442

Gold sold (oz.) 43,884 43,782

Cash Cost ($) per oz. gold 536 513

Total Cash CostsTotal cash costs are calculated on a consolidated basis as cash costs plus mining tax and administrative expenses. Total cash costsper ounce of gold sold is calculated by dividing the aggregate of these costs by total ounces sold.

20 20$'0 0 0

2019$'000

Cash costs 23,542 22,442

Adjustments for: Mining tax 2,330 4,330

Administrative expenses excluding exceptional expenses 10,243 8,755

Depreciation of property, plant and equipment and right of use assets included withinadministrative expenses (455) (322)

Loss on disposal of property, plant and equipment included within administrative expenses (194) (285)

T otal Cash Costs 35,466 34,920

Gold sold (oz.) 43,884 43,782

T otal Cash Cost ($) per oz. gold 808 798

Earnings Before Interest, Tax, Depreciation and Amortisation ("EBITDA")EBITDA is calculated on a consolidated basis as net profit/(loss) for the period excluding income tax expense, finance expense,finance income, foreign exchange movements, depreciation, amortisation and depletion, and impairment charges.

20 20$'0 0 0

2019$'000

Revenue 80,975 63,108

Adjustments for: Cost of sales (40,070) (40,300)

Administrative expenses including exceptional expenses (12,230) (8,755)

Other operating income 811 68

Total depreciation/depletion of property, plant and equipment and right of use assets charged toincome statement 13,014 11,999


EBIT DA 42,694 26,405

Adjusted Earnings Before Interest, Tax Depreciation and Amortisation ('Adjusted EBITDA')Adjusted EBITDA is calculated on a consolidated basis as EBITDA less exceptional expenses and other non-cash items.

20 20$'0 0 0

2019$'000

EBITDA 42,694 26,405

Adjustments for: Exceptional expenses 1,987 -


Adjusted EBIT DA 46,241 26,405

All-In Sustaining Costs ("AISC")AISC reflect the full costs of keeping the mine in business and include adjusted operating expenditure, sustaining corporate andadministrative expenditure, and sustaining capital and exploration expenditure. It excludes non-sustaining costs related to newoperations and costs that are not related to current operations, as well as taxes, finance costs and working capital adjustments.

20 20$'0 0 0

2019$'000

Cash costs 23,542 22,442

Adjustments for: Mining tax 2,330 4,330

Administrative expenses excluding exceptional expenses 10,243 8,755

Depreciation of property, plant and equipment and right of use assets included withinadministrative expenses (455) (322)

Loss on disposal of property, plant and equipment included within administrative expenses (194) (285)

Purchase of property, plant and equipment 2,450 6,713

Non-sustaining exploration expenditure (117) (507)

Accretion of restoration costs 81 94

AISC 37,880 41,220

Gold sold (oz.) 43,884 43,782

AISC ($) per oz. gold 863 941

Company Information

Directors Alexander Dorogov Eugene Antonov

Lou Naumovski Stewart Dickson

Chief Executive Officer Chief Operating Officer

Non-executive Director Non-executive Director

Secretary Simon Olsen Company number 01067991 Registered of f ice 39 Parkside Cambridge United

Kingdom CB1 1PN

Business address P.O. Box 278 St. Neots PE19 9EA Independent Auditors PricewaterhouseCoopers LLP 1

Embankment Place London WC2N6RH

Telephone: +44 (0)20 7583 5000

Nominated Adviser &Corporate Broker

Canaccord Genuity Limited 88 WoodStreet London EC2V 7QR

Telephone: +44 (0)20 7523 8000

Jo int CorporateBroker

Panmure Gordon (UK) Limited OneNew Change London EC4M 9AF

Telephone: +44 (0)20 7886 2500

Bankers National Westminster Bank PLC Cityof London Office PO Box 12258 1Princes Street London EC2R 8PA

Solicitors Locke Lord (UK) LLP 201 BishopsgateLondon EC2M 3AB

Akin Gump Strauss Hauer & Feld LLP10 Bishops Square Eighth FloorLondon E1 6EG

Telephone: +44 (0)20 7861 9000

Telephone: +44 (0)20 7012 9600

Regist rar Link Asset Services Northern HouseWoodsome Park Fenay Bridge,Huddersfie ld West Yorkshire HD80GA

Telephone: 0871 664 0300 International: +44 (0)208639 3399

Public Relat ions Hudson Sandler LLP 25 CharterhouseSquare London EC1M 6AE

Telephone: +44 (0)20 7796 4133

UK - Registered office39 Parkside, Cambridge, CB1 1PN, United Kingdom

UK - Head officeTrans-Siberian Gold plc, P.O. Box 278, St. Neots, PE19 9EA, United Kingdom

Russia - Moscow officeTrans-Siberian Gold Management, LLC (TSGM), Office 1, 45th Floor, Federation's East Tower (Vostok), Presnenskaya Naberezhnaya, 12,123112 Moscow, Russia

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