ACACIA MINING PLC - 2016 interim results

22 July 2016

Results for the 6 months ended 30 June 2016 (Unaudited)

Based on IFRS and expressed in US Dollars (US$)

Acacia Mining plc ("Acacia') reports 2016 interim results

"We are pleased that, through continuing optimisation, our assets are starting to deliver performance which reflects their potential and as a result increased our net cash position by US$47 million in the second quarter", said Brad Gordon, Chief Executive Officer of Acacia Mining. "Strong production of 221,815 ounces aided a further reduction in All-in Sustaining Cost ("AISC") to US$926 per ounce, even after US$72 per ounce of cost due to the impact of the strong share price on the valuation of future share-based payments to employees. The transition to underground mining at North Mara continues to deliver ahead of expectations with high grades at Gokona supporting production of 100,016 ounces in the quarter. Bulyanhulu again produced above plan, delivering 78,643 ounces, although a planned two week shaft closure for maintenance in August and a move back towards reserve grade will reduce output in Q3. As a result of the strong operational performance, coupled with the improved gold price outlook, the Board have declared an interim dividend of US2.0 cents per share, a 43% increase over the prior year. We are pleased with performance in the first half, and are now expecting to deliver at or above the upper end of full year production guidance of 750-780,000 ounces, and at the lower end of AISC guidance of US$950-980 per ounce."

Operational Highlights

• Q2 gold production of 221,815 ounces, 19% higher than Q2 2015, with gold sales of 216,782 ounces
• Q2 AISC¹ of US$926 per ounce sold, 19% below Q2 2015, after a US$72 per ounce share-based payment valuation impact
• Q2 cash costs¹ of US$595 per ounce sold, 23% lower than Q2 2015
• H1 gold production of 412,025 ounces, 12% higher than H1 2015, with gold sales of 400,963 ounces
• H1 AISC¹ of US$941 per ounce sold, after a US$49 per ounce share-based payment valuation impact, and cash costs of US$640, respectively 17% and 18% lower than H1 2015
• Continued low cost expansion of exploration activity, with 10 rigs active across Africa, delivering positive results

Financial Highlights

• H1 revenue of US$505 million, 13% higher than H1 2015, due to a 13% increase in gold sales
• H1 EBITDA¹ of US$185 million, 91% higher than H1 2015, due to higher revenues and lower operating costs
• H1 net loss of US$6 million (US1.5 cents per share) as a result of US$70 million of additional tax provisions made in Q1 2016, with H1 Adjusted net earnings¹ of US$59 million (US14.3 cents per share), up from US$18 million in H1 2015
• Operational cash flow of US$157 million, 47% up on H1 2015, driven primarily by higher sales volumes

• Cash position of US$284 million as at 30 June 2016, an increase of US$47 million during the second quarter
• Net cash of US$171 million, an increase of 38% during Q2 2016
• Interim dividend of US2.0 cents per share declared, an increase of 43% over the 2015 interim dividend

¹ These are non-IFRS measures. Refer to page 24 for definitions

² Excludes non-cash capital adjustments (reclamation asset adjustments) and includes finance lease purchases and land purchases recognised as long term prepayments

Other Developments

Expansion of Exploration Portfolio in Burkina Faso

In June 2016, Acacia entered into an agreement with Metalor SA, a local Burkinabe company (the "Frontier Joint Venture"), which includes two licences immediately south of, and contiguous to, the Pinarello Project where soil sampling has identified multiple kilometre scale gold-in-soil anomalies. This joint venture adds a further 500 square kilometres to Acacia's land package on the Houndé Belt, increasing the overall project area to approximately 2,700 square kilometres. The joint venture allows Acacia to earn 100% of the project through certain staged option payments totalling US$300,000 over 30 months. Metalor will hold a 1% net smelter royalty (NSR) on production from the project should Acacia identify and exploit an economic gold deposit, and Acacia has the right to acquire the NSR from Metalor for US$1 million at any future point in time.

Tax Provision from Historic Tax Assessments

As disclosed at our Q1 2016 results, we received a judgement from the Court of Appeal in favour of the Tanzanian Revenue Authority regarding a long-standing dispute over tax calculations at Bulyanhulu from 2000-2006. The legal route in Tanzania has now been exhausted; however we are considering our options with regards to next steps. Acacia is yet to receive a revised tax assessment following the judgement, but raised tax provisions of US$69.9 million in Q1 2016 in order to address the direct impact of the ruling on Bulyanhulu's tax loss carry forwards and the potential impact this may have on the applicability of certain deductions for other years and our other mines. The judgement does not have a short term cash flow impact but means that Bulyanhulu will be in a tax payable situation approximately one year earlier than previously expected, whilst the amounts for North Mara and Tulawaka will be offset against the long term indirect tax receivable and prepaid corporate taxes.

Indirect taxes

During the second quarter, the total indirect tax receivables increased from US$97.8 million at 31 March 2016 to US$109.1 million at 30 June 2016. The increase is mainly driven by indirect tax payments of US$23.2 million during the quarter, being partially offset by refunds received of US$17.0 million, and is further impacted by a Q2 2016 reduction of US$6.5 million in the discounting provision relating to indirect tax receivables covered by the 2011 Memorandum of Settlement ("MOS"). At the end of the second quarter, the outstanding amount relating to the total current indirect tax receivable, not covered by the MOS, stood at US$50.8 million, compared to US$46.1 million at the end of the previous quarter. The overall indirect tax receivable remained in line with December 2015, as the payment of US$10 million in prepaid corporate taxes, in line with the Memorandum of Understanding agreed in March 2016, was offset by the impact of the reduction of the discounting provision.

North Mara Commission

In February 2016, the Tanzanian Minister of Mines formed a commission to look at the root causes of historic disputes between North Mara and the communities surrounding the mine. The commission was formed of local elders, Acacia employees, government officials and politicians from outside the local area, and conducted interviews and assessments into issues pertaining to land acquisition and compensation, artisanal mining, water and environment. The Minister of Mines has now published the recommendations made by the commission which are in line with company expectations, provide a fair outcome for all stakeholders and will provide a good platform to continue to enhance our relationships with the local communities.

Interim dividend

In line with our policy of declaring 15% - 30% of cash flow before expansion capital, dividends and financing costs as a dividend to our shareholders, we are pleased to announce that the Board of Directors have approved the payment of an interim dividend of US2.0 cents per share, a 43% increase from the 2015 interim dividend. This increase reflects the improved cash generation in the business and our prospects for the remainder of the year. The dividend will be paid on 30 September 2016 to shareholders on the register on 2 September 2016. Acacia will declare the interim dividend in US dollars. Unless a shareholder elects to receive dividends in US dollars, they will be paid in pounds sterling with the US dollar amount being converted into pounds sterling at the exchange rate prevailing at the time. The last date for receipt of currency elections will be 5 September 2016. The exchange rate for the conversion of the interim dividend will be elected on or around 7 September 2016.

Share-based payments

In order to align employee remuneration with long term valuation creation for shareholders, senior employees can be granted long term incentives as a part of their annual pay package. Due to the level of free float, these awards are primarily in the form of restricted share units (RSUs) which vest after a three year period and are cash settled. As the awards are cash settled they are marked to market each quarter against the share price. There are approximately 9 million units in issue, with approximately two thirds of these further linked to performance of the share price (PRSUs) and as such can vest between zero and 200% of the initial grant amount depending on share price performance compared to peers. These units are generally awarded and consequently vest in the first quarter of the year, but are also awarded on the appointment of senior employees out of this timeline. In Q3 2016, approximately 935,000 performance units are due to vest and due to the near trebling of the share price over the past three years are currently due to vest at 200% of the original grant. A further 1.0 million PRSUs and 1.6 million RSUs are due to vest in Q4 2016, with the PRSUs also currently at 200% performance.

Outlook

We are pleased with performance over the first half of 2016 and as a result are now expecting to deliver at or above the upper end of the full year production guidance of 750-780,000 ounces, and at the lower end of AISC guidance of US$950-980 per ounce. As we move into H2 2016, we expect a step up in production at Buzwagi with grade increasing each quarter until the end of the year as mining is re-established in the main zone of the orebody. At North Mara and Bulyanhulu we expect smaller contributions in the second half with North Mara quarterly production normalising below the Q2 2016 level. At Bulyanhulu we will see a lowering of the average grade mined to in line with the reserve grade. This, together with a planned two week shutdown of the hoisting shaft for refurbishment in August, will lead to Q3 2016 being in line with Q3 2015 before increasing again in Q4.

Looking further forward we continue to look to optimise our portfolio and are focused on value enhancing brownfields extensions at Bulyanhulu and North Mara, as well as assessing our options at Buzwagi. We continue to invest in our high quality exploration portfolio and believe it holds the potential to host our next mine.

Key statistics

Financial results

¹ These are non-IFRS financial performance measures with no standard meaning under IFRS. Refer to "Non IFRS measures" on page 24 for definitions.

² Reflect the London PM fix price.

³ Cash cost per tonne milled excluding the reprocessing of tailings at Bulyanhulu amounted to US$62 per tonne for the quarter and US$60 per tonne for the six months ended 30 June 2016, (US$66 per tonne for the quarter and US$67 per tonne for the six months ended 30 June 2015).

*Reported process recovery rates and head grade include tailings retreatment at Bulyanhulu. Excluding the impact of the tailings retreatment in Q2 2016 and year to date 2016 process recovery would be 92.3% and 90.7% respectively (2015: 89.9% and 89.4% respectively), with Q2 2016 and year to date H1 2016 head grade being 3.6g/t and 3.3g/t respectively (H1 2015: 2.9g/t and 3.1g/t respectively)

For further information, please visit our website: http://www.acaciamining.com/ or contact:

Brad Gordon, Chief Executive Officer

Andrew Wray, Chief Financial Officer

Giles Blackham, Investor Relations Manager

Daniel Thöle

About Acacia Mining plc

Acacia Mining plc (LSE:ACA) is Tanzania's largest gold miner and one of the largest producers of gold in Africa. We have three producing mines, all located in north-west Tanzania: Bulyanhulu, Buzwagi, and North Mara and a portfolio of exploration projects in Tanzania, Kenya, Burkina Faso and Mali.

Our approach is focused on strengthening our core pillars; our business, our people and our relationships, whilst continuing to invest in our future. Our ambition is to create a leading African Company.

Acacia is a UK public company headquartered in London. We are listed on the Main Market of the London Stock Exchange with a secondary listing on the Dar es Salaam Stock Exchange. Barrick Gold Corporation is our majority shareholder. Acacia reports in US dollars and in accordance with IFRS as adopted by the European Union, unless otherwise stated in this report.

Conference call

A presentation will be held for analysts and investors on 22 July 2016 at Noon London time.

For those unable to attend, an audio webcast of the presentation will be available on our website http://www.acaciamining.com/. For those who wish to ask questions, the access details for the conference call are as follows:

Participant dial in: +44 (0) 203 003 2666 / +1 212 999 6659

Password: Acacia

FORWARD- LOOKING STATEMENTS

This report includes "forward-looking statements" that express or imply expectations of future events or results. Forward-looking statements are statements that are not historical facts. These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future production, operations, costs, projects, and statements regarding future performance. Forward-looking statements are generally identified by the words "plans," "expects," "anticipates," "believes," "intends," "estimates" and other similar expressions.

All forward-looking statements involve a number of risks, uncertainties and other factors, many of which are beyond the control of Acacia, which could cause actual results and developments to differ materially from those expressed in, or implied by, the forward-looking statements contained in this report. Factors that could cause or contribute to differences between the actual results, performance and achievements of Acacia include, but are not limited to, changes or developments in political, economic or business conditions or national or local legislation or regulation in countries in which Acacia conducts - or may in the future conduct - business, industry trends, competition, fluctuations in the spot and forward price of gold or certain other commodity prices (such as copper and diesel), currency fluctuations (including the US dollar, South African rand, Kenyan shilling and Tanzanian shilling exchange rates), Acacia's ability to successfully integrate acquisitions, Acacia's ability to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources or reserves, and to process its mineral reserves successfully and in a timely manner, Acacia's ability to complete land acquisitions required to support its mining activities, operational or technical difficulties which may occur in the context of mining activities, delays and technical challenges associated with the completion of projects, risk of trespass, theft and vandalism, changes in Acacia's business strategy including, the ongoing implementation of operational reviews, as well as risks and hazards associated with the business of mineral exploration, development, mining and production and risks and factors affecting the gold mining industry in general. Although Acacia's management believes that the expectations reflected in such forward-looking statements are reasonable, Acacia cannot give assurances that such statements will prove to be correct. Accordingly, investors should not place reliance on forward-looking statements contained in this report.

Any forward-looking statements in this report only reflect information available at the time of preparation. Save as required under the Market Abuse Regulation or otherwise under applicable law, Acacia explicitly disclaims any obligation or undertaking publicly to update or revise any forward-looking statements in this report, whether as a result of new information, future events or otherwise. Nothing in this report should be construed as a profit forecast or estimate and no statement made should be interpreted to mean that Acacia's profits or earnings per share for any future period will necessarily match or exceed the historical published profits or earnings per share of Acacia.

LSE: ACA

TABLE OF CONTENTS

Interim Operating Review

Half Year Review

Acacia delivered first half production of 412,025, an increase of 12% year on year. AISC of US$941 per ounce sold and cash cost of US$640 per ounce sold were 17% and 18% respectively lower than the prior year period.

Operationally, North Mara's production of 174,737 ounces was 23% higher than the prior year mainly due to a 14% increase in grade, driven by the higher grade underground Gokona ore which also drove a 5% increase in recovery. AISC fell by 19% to US$720 per ounce sold predominantly due to the higher production base and lower cash costs.

Bulyanhulu saw an 18% increase in production to 157,069 ounces. This was due to ounces produced from underground mining increasing by 18% from H1 2015, as a result of an 11% increase in grade, a 5% increase in throughput due to improved plant availability and underground delivery and a 15% increase in ounces produced from tailings retreatment. AISC decreased by 28% to US$970 per ounce sold due to the higher production base, lower direct mining costs and lower sustaining capital expenditure.

At Buzwagi, gold production for the first half of 80,219 ounces was in line with expectations and 13% lower than H1 2015 due to a planned 20% reduction in grade as a result of the focus on waste stripping in the early part of the period. The lower production base drove a 3% increase in AISC to US$1,124 per ounce sold from US$1,089 per ounce sold in H1 2015.

Total tonnes mined during the year amounted to 19.3 million tonnes, 6% lower than H1 2015 due to lower tonnes mined at Buzwagi as a result of the increased haulage distances given the increased pit size. Ore tonnes mined were 4.7 million tonnes compared to 4.9 million in H1 2015 as a result of lower ore tonnes mined at Nyabirama pit at North Mara due to a focus on waste stripping, and the cessation of mining from the Gokona pit in H1 2016.

Ore tonnes processed amounted to 4.9 million tonnes, an increase of 7% on H1 2015 primarily driven by increased throughput at Bulyanhulu as reprocessed tailings increased from 0.6 million tonnes in H1 2015 to 0.8 million tonnes in H1 2016.

Head grade for the year to date of 3.0 g/t was 7% higher than in H1 2015 (2.8 g/t). This was due to a 14% increase in head grade at North Mara due to the contribution of the higher grade Gokona underground ore and an 11% increase in run-of-mine head grade at Bulyanhulu as underground mined grades improved, partly offset by a 20% decrease in head grade at Buzwagi.

Our cash costs for the period were 18% lower than in H1 2015, and amounted to US$640 per ounce sold. The decrease was primarily due to:

• Higher production base (US$80/oz);
• Lower labour costs due to a reduction in employees, together with favourable currency impact on Tanzanian shilling based wages when compared to H1 2015 (US$32/oz);
• Lower energy and fuel costs due to lower hedge pricing and lower oil prices realised (US$23/oz); and
• Higher capitalisation of development costs at North Mara due to the Gokona underground development, partly offset by lower capitalisation of development costs at Bulyanhulu (US$21/oz).

These were partly offset by higher sales related costs as a result of higher sales volumes (US$18/oz) and increased contracted services, mainly related to contracted mining at North Mara and increased maintenance and repair contractors ("MARC") costs at Buzwagi.

The all-in sustaining cost of US$941 per ounce sold for the half year was 17% lower than H1 2015, driven by the higher production base, lower cash costs, lower corporate administration costs and lower sustaining capital expenditure. This was however impacted by a revaluation of future share-based payments amounting to US$19.6 million (US$49/oz) following the 150% increase in Acacia's share price over the first half of the year.

As a result of the higher gold sales, partly offset by a working capital outflow, cash generated from operating activities increased by 47% over the prior year period to US$157.0 million.

Capital expenditure amounted to US$85.2 million in H1 2016 compared to US$89.0 million in H1 2015. Capital expenditure primarily comprised capitalised development (US$59.5 million), investments in tailings and infrastructure (US$9.6 million), investment in mobile equipment and component change-outs (US$5.0 million), investment in the Bulyanhulu winder upgrade (US$1.7 million) and land purchases at North Mara (US$2.8 million).

Second Quarter Review

Production for Q2 2016 amounted to 221,815 ounces, an increase of 19% on the same period in 2015 and 17% higher than Q1 2016.

North Mara produced 100,016 ounces in Q2 2016, 50% higher than in Q2 2015 and 34% higher than Q1 2016, driven by higher grade ore than plan from the Gokona Underground resulting from positive grade reconciliations and the processing of higher grade open pit material. Total open pit tonnes mined increased by 23% from Q2 2015 driven by waste stripping in the Nyabirama pit. Cash cost per ounce sold of US$382 was 37% lower than in Q2 2015 mainly driven by the higher production base, higher capitalised development costs due to waste stripping at the Nyabirama pit and lower labour costs due to reductions in head count, partly offset by higher sales related costs as a result of higher sales volumes. AISC of US$707 per ounce sold was 27% lower than in Q2 2015 due to higher production base, lower cash costs and lower corporate administration expenditure, partly offset by increased capitalised development costs and higher sustaining capital expenditure mainly as a result of land acquired.

Bulyanhulu produced 78,643 ounces, 10% higher than for the same period in Q2 2015 and in line with Q1 2016. Ounces produced from underground mining amounted to 70,307 ounces, a 17% improvement on Q2 2015 due to an increase in throughput and grade, while ounces produced from the reprocessing of tailings amounted to 8,336 ounces. During the quarter, 236,000 tonnes of ore were hoisted while 251,000 tonnes of run-of-mine ore were processed, 10% higher than in Q2 2015 while grade increased by 5% to 9.6 g/t. AISC amounted to US$958 per ounce sold for the quarter, 25% lower than in Q2 2015 and 3% lower than Q1 2016, m

ainly driven by the lower cash costs, increased production base, lower sustaining capital and capitalised development expenditures and lower corporate administration expenses.

At Buzwagi, gold production for the quarter of 43,156 ounces was 10% lower than Q2 2015, but 16% ahead of Q1 2016. Total tonnes mined decreased by 18% from Q2 2015 while ore tonnes mined were in line with the prior year. Cash cost per ounce sold of US$948 was 2% higher than Q2 2015 mainly due to the lower production base, partly offset by lower energy and fuel costs driven by lower global fuel prices and lower diesel usage, lower general and administrative expenses as a result of lower freight costs and lower labour costs driven by headcount reductions. AISC of US$1,019 per ounce sold was 4% lower than Q2 2015 with lower production and higher cash costs offset by lower corporate administration expenditure and lower sustaining capital expenditure.

Total tonnes mined during the quarter amounted to 9.9 million tonnes, 4% lower than Q2 2015. Ore tonnes mined were 2.2 million tonnes compared to 2.4 million in Q2 2015.

Ore tonnes processed amounted to 2.4 million tonnes, in line with Q2 2015.

Head grade for the quarter of 3.2 g/t was 23% higher than in Q2 2015 (2.6 g/t) as a result of the higher head grade at North Mara given the contribution of the higher grade ore from Gokona Underground.

Capital expenditure for the quarter amounted to US$49.1 million compared to US$46.5 million in Q2 2015. Capital expenditure primarily comprised capitalised development (US$34.7 million), investment in tailings and infrastructure of US$4.2 million, investment in mobile equipment and component change out costs of US$2.8 million and investment in the Bulyanhulu winder upgrade of US$0.9 million.

Mine Site Review

Bulyanhulu

Key statistics

¹These are non-IFRS financial performance measures with no standard meaning under IFRS. Refer to 'Non-IFRS measures" on page 24 for definitions.

Operating performance

Gold production for the first half of 157,069 ounces was 18% higher than the same period in 2015. This was due to an 18% increase in ounces produced from underground mining over H1 2015, driven by an 11% increase in head grade, combined with a 5% increase in throughput due to improved plant availability. Production from the reprocessing of tailings increased by 15% against H1 2015 due to a significant increase in throughput and grade, which was partially offset by lower recoveries. Gold sold for the year amounted to 150,719 ounces, 24% higher than H1 2015 but 4% lower than production due to the timing of production at quarter end impacting the shipment of ounces and the impact of the refinery payable.

Copper production of 3.5 million pounds for the current year period was 15% higher than in H1 2015 due to higher throughput and copper recovery rates, partly offset by lower copper grades.

Cash costs for the first half of US$661 per ounce sold were 24% lower than H1 2015 (US$871) mainly due to the higher production base, lower labour costs driven by lower employee headcount and lower maintenance costs as a result of changes in the maintenance schedules, partly offset by lower capitalised development costs and higher sales related costs as a result of higher sales volumes.

AISC per ounce sold for the first half of US$970 was 28% lower than H1 2015 (US$1,356) driven by the impact of the higher production base, lower cash costs, lower capitalised development costs, lower sustaining capital expenditure and lower corporate administration expenditure.

Capital expenditure for the year to date before reclamation adjustments amounted to US$40.7 million, 18% lower than the 2015 expenditure of US$49.6 million, mainly driven by lower capitalised development and lower sustaining capital expenditure. Capital expenditure consisted mainly of capitalised underground development costs (US$28.4 million), investments in tailings and infrastructure (US$6.7 million), investments in the winder upgrade (US$1.7 million) and investment in mobile equipment and component change-outs (US$1.3 million).

Full year expectations for Bulyanhulu remain unchanged, with output in the second half of the year expected to be lower than in the first half as a result of a decrease in the average grade mined due to location of the various ore sources and increased contribution of lower grade Alimak stopes. In the third quarter, there will also be a major shutdown of the vertical shaft to undertake refurbishment and modernisation of the production winder. The shutdown, which was factored into annual guidance at the beginning of the year, will last for approximately two weeks in August and will result in lower hoisted and mined tonnes compared to Q2 2016. During the shaft upgrade, the plant will also have an extended shut down as we co-ordinate planned maintenance of the process plant with the shaft work which will lead to Q3 2016 production being in line with Q3 2015, before increasing again in Q4 2016.

Over the second half of the year the planning team will also be focused on updating the mine plan to incorporate a number of the initiatives that have we have been progressing in order for the mine to perform to its geological potential over the medium term. These initiatives include the mechanised mining method mix, adding in new work areas and processing improvements.

Buzwagi

Key statistics

¹These are non-IFRS financial performance measures with no standard meaning under IFRS. Refer to "Non-IFRS measures" on page 24 for definitions.

Operating performance

Gold production for the first half of 80,219 ounces was 13% lower than H1 2015, primarily due to a 20% lower head grade as a result of the focus on waste movement. This was partially offset by a 5% increase in throughput and continued recovery improvements. Gold sold for the period amounted to 80,404 ounces, in line with production. As previously guided, grade is expected to increase quarter on quarter through the rest of the year, with approximately 55% of full year production expected to occur in the second half of the year.

Total tonnes mined for the first half of 11.4 million tonnes were 11% lower than H1 2015 due to increased haulage distances as the pit continued to deepen.

Copper production of 4.9 million pounds for the year to date was 11% higher than the prior year period due to increased throughput and copper recovery rates, partly offset by lower copper grades.

Cash costs for the first half of US$1,052 per ounce sold were 9% higher than in H1 2015 (US$965). Cash costs were primarily impacted by the lower production base, partly offset by lower energy and fuel costs due to lower global fuel prices, lower labour costs as a result of a reduction in headcount, lower consumables costs as a result of lower cyanide and grinding media costs and lower general and administration costs as a result of lower warehousing and logistics expenditure.

AISC per ounce sold for the first half of US$1,124 was 3% higher than H1 2015 (US$1,089). This was mainly driven by the higher cash costs and lower production base as discussed above, partly offset by the lower sustaining capital expenditure and lower corporate administration expenditure.

Capital expenditure for the first half before reclamation adjustments of US$2.2 million was 59% lower than H1 2015 (US$5.5 million). Key capital expenditure for the year to date consists of investments in tailings wall raises and infrastructure of US$1.5 million and mobile equipment and component change out costs (US$0.3 million).

In the first half of the year we entered into zero cost collars in relation to the majority of our gold production from Buzwagi in 2016 and Q1 2017. In 2016, the agreements provide a guaranteed floor price of US$1,150 per ounce and provide exposure to the gold price up to an average of US$1,290 per ounce. These agreements cover 81,000 ounces of production in H2 2016. In Q1 2017, the agreements cover 43,000 ounces, with an average floor price of US$1,150 per ounce and a cap of US$1,421 per ounce.

Over the second half of the year we will continue to assess the future options for the mine post the expected end of mining operations in the first half of 2017.

North Mara

Key statistics

¹These are non-IFRS financial performance measures with no standard meaning under IFRS. Refer to 'Non-IFRS measures" on page 24 for definitions.

² Includes land purchases recognised as long term prepayments

Operating performance

Production for the first half of 174,737 ounces was 23% higher than the prior year period as a result of higher head grades and recovery rates. Production was driven by an increased contribution from the Gokona Underground, which delivered higher grade ore than plan as a result of positive grade reconciliations, coupled with the processing of high grade open pit material. Underground mined tonnes were below plan due to the installation of second egress ladder ways, which delayed the mining of certain stopes, however the grade of 13.8 g/t was well in excess of plan. Open pit mined grade decreased as a result of ore being solely sourced from the lower grade Nyabirama pit following the end of mining in the Gokona open pit, which was still in production in H1 2015.

The impact of the higher grade underground ounces combined with preferentially treating high grade open pit ounces drove head grade of 4.1g/t, up 14% over H1 2015. Gold ounces sold for the year of 169,840 ounces were 3% lower than production due to the timing of dore produced, but 20% higher than the prior year due to the higher production base.

Cash costs of US$427 per ounce sold were 27% lower than H1 2015 (US$583) driven by the higher production base, higher capitalised development costs and lower fuel costs, partly offset by increased contracted services costs as a result of the development of the Gokona Underground.

AISC per ounce sold for the first half of US$720 was 19% lower than H1 2015 (US$893) primarily due to the impact of increased sales volumes, lower cash costs and corporate administration expenditure, partly offset by higher capitalised development costs.

Capital expenditure for the first half before reclamation adjustments of US$41.6 million was 23% higher than in H1 2015 (US$33.9 million). Key capital expenditure included capitalised stripping costs (US$22.6 million), capitalised underground development costs (US$8.4 million), investment in mobile equipment and component change-outs (US$3.5 million) and investment in tailings and infrastructure (US$1.3 million). In addition, US$2.8 million was spent on land acquisitions primarily around the Nyabirama open pit. Land acquisition costs are included in capital expenditure above as they are included in AISC but are treated as long term prepayments in the balance sheet.

Due to the positive grade reconciliations in the Gokona Underground, performance at North Mara was ahead of plan for the first half of the year. The mining schedule for the year remains on track, and will see an increased proportion of underground ore sourced through the western portion of the mine which is expected to be lower grade than the current mining areas in the east mine. As a result, we expect the quarterly production levels in the second half to be below Q2 2016, at a higher AISC due to the lower production and introduction of cemented aggregate fill into the underground mining process.

Over the second half of the year, we will continue to assess the optimal longer term production potential of the Gokona Underground. As part of this review we are conducting diamond drilling into high potential areas where little drilling was previously possible from the surface to identify potential resource additions. A deeper drilling programme will also be undertaken in 2017 targeted at both increasing the existing Resources and converting Resources to Reserves. A drilling programme is underway to extend the existing Resource beneath the Nyabirama open pit in order to ascertain the potential for underground mining once the open pit activity concludes.

Exploration Review

Tanzania

Gokona Underground

The successful transition to underground mining at Gokona has led us to review the reserve and resource drilling requirements moving forward as we look to optimise the future production profile. Historic exploration drilling at Gokona shows that gold mineralisation extends to at least 900 metres below surface. The future drilling will focus on extending the life of mine by identifying new reserves and resources in "gap" areas within the current underground resource as well as upgrading existing resources into mineable reserves.

In H2 2016, we expect to drill 26 holes for a total of 4,000m from newly established drill platforms in the Gokona underground. This infill drilling programme targets the gaps in the reserve model below the active mining area but above the current reserve depth (990m RL). The results of this programme will feed into the annual reserve and resource statement in early 2017 and will provide further information before we commence further drilling in 2017 beneath the 990m RL designed to begin to upgrade approximately 930,000 ounces of existing resource (measured, indicated and inferred).

Nyabirama Deeps

During Q2 2016 we started a drilling programme to test for depth extensions of gold mineralisation beneath the Nyabirama pit. The programme will consist of 7 holes for a total of 5,000 metres and is targeting the underground potential of high grade mineralisation between 300m and 600m vertical depth beyond existing resources.

To date three holes have been completed for a total of 1,920 metres with the fourth hole currently in progress. The initial drilling has intersected the predicted structures and alteration returning mixed results in terms grade and thickness.

The results confirm the presence of a mineralised system to a vertical depth of 500m; however we need to complete the programme of step-out drilling to confirm the structural and mineralisation continuity. A structural study aimed at improving our understanding of the geometry of the high grade lodes at depth and the continuity of mineralisation is scheduled to be completed in Q3 and will be based on new information from the deep drilling programme.

Bulyanhulu

Underground exploration and resource/reserve definition drilling at Bulyanhulu has focused on the Reef 2 series of veins, targeting the Western Extensions and Central Zone. Definition drilling on the Central Zone is being completed on Reef 2m using a 50m x 50m staggered grid pattern and is showing good continuity of widths and grades comparable to the original broader spaced surface exploration holes. This is increasing the confidence in the reserve model for this area, and may result in the zone being brought forward in the mine plan. We are now stepping out the definition drilling in order to expand the reserve in this area further.

The initial exploration drilling into the Western Extensions is being completed on a 200m x 200m spaced grid pattern and is targeting the plunge and strike extensions of the Central Zone approximately 1-2km west of current resources. Results returned to date show that Reef 2i has the better grades and continuity although results have been mixed. We have therefore commenced infill drilling around some of the better intercepts to investigate the continuity of widths and grades on both Reef 2i and 2m. In total 21,961 metres of underground drilling have been completed on the extension drilling, and the current phases of exploration drilling are expected to continue until Q4 2016 before we review the success of the programme and future programmes.

Nyanzaga

In September 2015, Acacia entered into an earn-in joint venture with OreCorp Limited (ASX:ORR) to progress the Nyanzaga Project, whereby OreCorp took over management of the project for a 3 year period. This structure allows the project to be progressed whilst giving Acacia the optionality to maintain a 75% stake in the project once it gets to a development decision. In March 2016, OreCorp announced an updated JORC compliant resource of 2.78Moz at 4.1g/t using a cut-off grade of 1.5g/t following re-interpretation of existing data focusing on high grade zones and unconstrained by a pit shell. This has led to the project being progressed into a scoping study to assess the technical and economic viability of open pit and/or underground development scenarios. The scoping study is expected to be completed by the end of 2016.

Kenya

West Kenya Project

During H1 2016 we continued a reverse circulation (RC) and diamond core (DD) drilling programme designed to follow up on the positive results from the initial drilling programme on the Liranda Corridor within the Kakamega Dome gold camp. The planned programme consists of approximately 38,000 - 40,000 metres of drilling to test the structural orientation and continuity of high grade gold mineralisation encountered on the Acacia and Bushiangala Prospects. The programme, if successful, aims to allow for the calculation of an initial inferred resource by early 2017.

Year to date, 18 diamond holes for 12,253 metres and 32 RC holes for 4,359 metres have been completed. Ongoing geological and structural work suggests that the controls of the high grade zones are oblique to the main east west shear fabric and may also dip in the direction of drilling. As a result of these new structural understandings, the drilling programme was revised and drill hole orientations were changed to better test the new orientations. Following this, holes were drilled at 40m and 80m spacing around better mineralised intersections to confirm the 3D geometry.

At the Acacia Prospect drilling intersected mineralised zones consisting of narrow quartz veins, sulphides (pyrite +/- pyrrhotite +/- sphalerite +/- chalcopyrite +/- molybdenite) and alteration zones (sericite +/- green mica +/- carbonate) associated with two interpreted northeast striking zones, AZ1 and AZ2. At the Bushiangala Prospect the closer spaced drilling intersected high grade zones of gold mineralisation, but further drilling is required to definitively tie down the controls on the high grade structures, as it appears there may be multiple mineralised structures. Drilling is ongoing with three diamond core rigs currently operating and a further 2-3 rigs planned to be utilised during Q3 and at the start of Q4 2016 in order to complete the next stage of drilling.

Better results from the Acacia and Bushiangala prospects included:

• LCD0073 (Acacia) 6m @ 3.41 g/t Au from 273m incl. 1m @ 7.46 g/t Au.
• LCD0074 (Acacia) 1.4m @ 5.40 g/t Au from 327m.
• LCD0076 (Acacia) 5.8m @ 24.9 g/t Au from 334m.
• LCD0077 (Acacia) 2.5m @ 25.0 g/t Au from 412m.
• LCD0079 (Acacia) 1.5m @ 13.3 g/t Au from 31m, 3m @ 125 g/t Au from 37m, 4m @ 55.5 g/t Au from 349m.
• LCD0075 (Bushiangala) 2.8m @ 11.1 g/t Au from 253m, 12.8m @ 15.3 g/t Au from 274m.
• LCD0078 (Bushiangala) 4.3m @ 6.48 g/t Au from 105m, 2.3 @ 17.3 g/t Au from 226m.

Additionally, Acacia has earned an 85% interest in the Advance Joint Venture, which covers three small Special Licences that lie within the boundaries of the larger Lonmin Joint Venture area. Advance Gold elected not to contribute to current exploration programmes and is subsequently diluting below 15% during the current programme as Acacia completes exploration programmes on the licences.

Burkina Faso

Acacia continues to identify significant gold potential in the Houndé Belt through on-going soil sampling programmes and first-pass reconnaissance drilling programmes, with surface gold anomalies up to 5g/t identified on the Central Houndé JV, early positive results from Aircore drilling on the Pinarello project, and continued high grade intercepts along the Tankoro Trend on the South Houndé JV project. Furthermore, Acacia has continued to consolidate its land holding in the prospective Houndé Belt with the signing of a fourth joint venture, the "Frontier JV" with Metalor SA, a Burkina Faso registered local company. Acacia now holds approximately 2,700 square kilometres of licences and applications under joint ventures.

Frontier Joint Venture

In June 2016, Acacia entered into an agreement with a local Burkinabe company, Metalor SA, the "Frontier Joint Venture", which includes two licences immediately south of, and contiguous to, the Pinarello Project where soil sampling has identified multiple kilometre scale gold-in-soil anomalies. This JV added a further 500 square kilometres to Acacia's land package on the Houndé Belt, increasing the overall project area to approximately 2,700 square kilometres.

The JV allows Acacia to earn 100% of the project through certain staged option payments totaling US$300,000 over 30 months. Metalor will hold a 1% NSR on production from the project should Acacia identify and exploit an economic gold deposit, and Acacia has the right to acquire the NSR from Metalor for US$1 million at any future point in time.

Historic reconnaissance soil sampling has already identified gold anomalism on the Frontier JV properties associated with interpreted regional shear zones along the contacts between granite intrusions and volcano-sedimentary lithologies. We expect to commence regolith mapping and more detailed soil sampling programmes in Q4 2016 following the wet season in order to fully understand the regional potential of this project area. In the meantime, detailed aeromagnetic and radiometric surveys will be flown across these properties during July 2016 as part of a larger geophysical programme.

Pinarello Project

Following an extensive regional programme of soil sampling across the Pinarello project, the current work plan for 2016 consists of approximately 21,000 metres of Aircore drilling across several high priority target corridors, each extending over multiple kilometres. The initial Aircore holes have targeted the southern extensions of the Tankoro Structural Corridor within the northern part of the Pinarello project. A number of encouraging intersections have been returned from holes testing both IP geophysical and soil/auger geochemical anomalies. To date 218 holes have been drilled for 11,666 metres, with assay results received for 165 holes and the remainder of assays pending. A review of the assay results shows that 65 of the 165 holes (39%) have returned anomalous gold intersections (>1m @ 0.1g/t Au).

Better intersections received and verified include:

• PIAC00045: 7m @ 0.36g/t Au from surface and 2m @ 1.58g/t Au from 21m,
• PIAC00055: 1m @ 1.56g/t Au from 60m,
• PIAC00056: 8m @ 1.66g/t Au from 55m,
• PIAC00057: 25m @ 0.44g/t Au from 38m and 2m @ 1.08g/t Au from 72m,
• PIAC00060: 2m @ 0.84g/t Au from 57m,
• PIAC00061: 8m @ 0.59g/t Au from 48m and 12m @ 0.80g/t Au from 61m,
• PIAC00109: 1m @ 1.59g/t Au from 28m,
• PIAC00113: 1m @ 1.00g/t Au from 70m,
• PIAC00126: 13m @ 0.89g/t Au from 64m,
• PIAC00131: 4m @ 0.69g/t Au from 50m,
• PIAC00140: 6m @ 0.47g/t Au from 31m, and
• PIAC00141: 9m @ 0.85g/t Au from 28m.

This initial phase of reconnaissance Aircore drill programme is scheduled for completion during July, with compilation of results and planning for a second phase of reconnaissance drilling to be completed during the Q3 2016 wet season. The second phase of drilling is scheduled for Q4 2016 and will consist of further Aircore drilling and initial RC drilling at several prospects.

Additionally, infill soil sampling of large areas of gold anomalism on the eastern areas of the Pinarello project continues to better delineate gold trends, and these target areas will form part of future phases of reconnaissance Aircore drilling.

A detailed, 100 metre line-spaced, aeromagnetic and radiometric survey is expected to commence during July. This survey will extend onto the Frontier JV properties and will be used to assist in the regional structural and geological interpretation in combination with surface geochemical surveys in order to better target future reconnaissance drill programmes.

Central Houndé JV and Konkolikan Projects

The Central Houndé JV properties and the Konkolikan JV properties are contiguous with each other and cover part of a large north-south shear zone, the Ouango-Fitiri Shear Zone (OFSZ), that extends from Ivory Coast in the south to the Houndé township in the north, more than 200km.

Extensive surface gold anomalies up to 5g/t have been identified across the projects from soil sampling, including the 10km long, northeast-trending, Legue-Bongui "corridor" in the southeast of the Central Houndé JV project. Infill soil sampling has been completed across the Legue-Bongui corridor, and we will complete the infill soil sampling of the remainder of the targets including regional anomalies on the Konkolikan project in Q4 2016.

The current work programme includes target delineation reverse circulation (RC) drilling of approximately 70 holes for 10,000 metres across several targets within the Legue-Bongui "corridor" and approximately 12-15 diamond core holes for 3,000 metres across four priority geochemical and structural targets around the Ouere Ouest and Legue prospects, the site of current artisanal activity. Drilling of RC and diamond core commenced in late June 2016 with one diamond core hole and five RC holes completed to date. Assay results from all holes were pending at the end of the quarter.

In addition to the first phase of drilling, we are conducting a detailed aeromagnetic and radiometric survey across the Central Houndé and Konkolikan properties with the aim of completing the survey before the end of July 2016.

South Houndé JV Project

We continue to actively explore the South Houndé JV properties with Sarama Resources. Exploration to date has defined a resource of 2.1Moz @ 1.5g/t Au (0.5g/t cut-off) that includes a higher grade resource of 1.5Moz @ 2.1g/t Au (at a 1g/t cut-off). The aim of 2016 drill programmes is to further expand the Tankoro global resource through the addition of higher grade resource ounces and new discoveries across the project.

Results from RC and diamond core drilling on the MM and MC zones continue to highlight significant potential higher grade mineralisation at depth and related to cross cutting structures.Drilling in 2016 consists of 1,826 auger holes for 11,000 metres, 243 aircore holes for 11,034 metres, 80 RC holes for 7,421 metres, and 11 diamond core holes for 1,963 metres. Better results reported to date (previously released by Sarama Resources - dated 16 May 2016; www.saramaresources.com) from the Tankoro Corridor prospects include:

MC

• 15m @ 7.44 g/t Au from 47m
• 14m @ 4.12g/t Au from 41m
• 6m @ 3.91g/t Au from 85m

Phantom East

• 8m @ 4.45g/t Au from 20m
• 12m @ 5.78g/t Au from 12m

Kenobi

• 23m @ 1.73 g/t Au from 40m
• 16m @ 1.19 g/t Au from 38m

Acacia will earn 50% in the South Houndé JV at the end of 2016 on completion of Phase 1 expenditure commitments, and will have the option to take over management of Phase 2 of the joint venture from January 1, 2017. Assuming Acacia moves into Phase 2 of the joint venture agreement, Acacia will have the option to earn a further 20% in the project by completing further exploration expenditure of US$7.0 million before 31 December 2018, and an additional 5% interest in the project, to 75%, by taking a resource to completion of a pre-feasibility study.

The current drill programme going forward consists of RC and diamond core drilling with the focus of drilling on:

• delineation of cross structures on MM and MC trends that are interpreted to control zones of higher-grade mineralisation
• pole-dipole IP geophysical targets at depth interpreted to represent sulphide accumulations associated with gold mineralisation within porphyries and sediments
• deeper follow-up of previously untested gold mineralisation from shallow Aircore, RC and diamond core drilling anomalous intercepts

Mali

Bane-Tintinba Properties

In June 2015, Acacia commenced exploration in Mali when it acquired interests in the Tintinba project. The project comprises three exploration permits (Bane, Bane Est and Tintinba) covering over 150 square kilometres along the world class Senegal-Mali Shear Zone.

Initial soil sampling programmes have defined eight large multi-kilometre scale gold anomalies across the three permits. These gold anomalies are interpreted to be associated with second-order, northwest and northeast oriented, splay structures within the highly prospective Senegal-Mali Shear Zone (a several kilometre wide structural domain). Acacia geologists have already mapped prospective geology, structure, alteration and veining, and a number of the targets have associated artisanal workings.

A programme of RC drilling consisting of approximately 70 holes for 8,500 metres commenced in late May. This programme is designed to test several of the priority gold-in-soil anomalies. To date, 29 holes have been completed for 3,209 metres with assay results currently pending for 21 holes. Results received to date are encouraging for first pass reconnaissance holes, with highly anomalous results including 19m @ 0.55 g/t Au from 74m and 17m @ 0.71 g/t Au from 13m. The onset of the wet season in Mali has resulted in the likely early suspension of the RC drilling programme, with the remainder of the programme now scheduled for Q4 2016.

Financial Review

The continued cost discipline during the period combined with an increased gold price in Q2 2016 was reflected in strong cash generation, with net cash increasing by US$66 million over the first six months of the year. At the same time, reported earnings were impacted by an increase in tax provisions related to court rulings regarding prior year tax assessments. This is reflected in the Acacia Group's financial results for the six months ended 30 June 2016:

• Revenue of US$504.9 million was US$58.2 million higher than H1 2015 driven by the 13% higher sales volumes (45,493 ounces).
• Cash costs decreased to US$640 per ounce sold from US$780 in H1 2015, driven by the higher production base, lower labour costs, lower energy and fuel costs and higher capitalisation of development costs, partly offset by higher sales related costs.
• AISC was 17% lower than H1 2015 at US$941 per ounce sold (H1 2015: US$1,133 per ounce sold) as the higher production base, lower cash costs, lower corporate administration expenditure and lower sustaining capital expenditure were partly offset by higher share-based payment expenditure.
• EBITDA increased by 91% to US$184.9 million, mainly driven by the higher sales volume, lower corporate administration costs, and lower other charges costs.
• Tax expense of US$107.7 million compared to the prior year period expense of US$10.2 million was driven by provisions for uncertain tax positions raised in Q1 2016 of approximately US$70 million in response to an adverse court ruling relating to Bulyanhulu historical tax assessments, in combination with tax on higher profit before tax.

• As a result of the above, we incurred a loss of US$6.1 million, compared to a profit of US$14.8 million in H1 2015.
• Adjusted net earnings of US$58.8 million were 221% higher than H1 2015. Adjusted earnings per share, mainly excluding prior year tax provisions and restructuring costs, amounted to US14.3 cents, up from US4.5 cents in H1 2015.
  • Operational cash flow of US$157.1 million was 47% higher than H1 2015, primarily as a result of higher gold sales volumes driving higher revenue, partly offset by unfavourable working capital outflows due to a reduction in accounts payable as a result of timing of payments and an increase in accounts receivable, and a US$10 million prepayment of corporate tax as agreed with the Tanzanian Government and reported in Q1 2016.

The following review provides a detailed analysis of our consolidated results for the six months ended 30 June 2016 and the main factors affecting financial performance. It should be read in conjunction with the unaudited consolidated financial information and accompanying notes on pages 35 to 48, which have been prepared in accordance with International Financial Reporting Standards as adopted for use in the European Union ("IFRS").

Revenue

Revenue for H1 2016 of US$504.9 million was US$58.2 million higher than H1 2015 due to a 13% increase in gold sales volumes (45,493 ounces) combined with a 1% increase in the average realised gold price from US$1,200 per ounce sold in H1 2015 to US$1,209 in H1 2016. The increase in sales ounces was due to the higher production base.

Included in total revenue is co-product revenue of US$20.3 million for H1 2016, in line with the prior year period (US$20.2 million). The H1 2016 average realised copper price of US$2.13 per pound compared unfavourably to that of H1 2015 (US$2.61 per pound), and was driven by the lower market price for copper. This was offset by an 18% increase in copper sales volumes mainly at Bulyanhulu.

Cost of sales

Cost of sales was US$355.4 million for H1 2016, representing a decrease of 2% on the prior year period (US$363.6 million). The key aspects impacting the cost of sales for the year were an 11% reduction in direct mining costs, partly offset by higher depreciation and amortisation costs as a result of the higher production base.

The table below provides a breakdown of cost of sales:

^{*Depreciation and amortisation includes the depreciation component of the cost of inventory sold.}

A detailed breakdown of direct mining expenses is shown in the table below:

Gross direct mining costs of US$298 million for H1 2016 were 8% lower than H1 2015 (US$322 million). Individual cost components comprised:

• A 22% reduction in labour costs, mainly as a result of a 33% reduction in international employees and a 25% reduction in national employees across the sites, driven by localisation efforts and restructuring and the savings associated with the local labour costs given the devaluation of the Tanzanian shilling.
• A 21% reduction in energy and fuel expenses across all sites due to lower global fuel prices, and the impact of a favourable exchange rate on locally purchased power.
• A 4% decrease in maintenance costs mainly at Bulyanhulu driven by reduced maintenance activity and changes to the maintenance schedules benefitting from planned maintenance activities last year.
• A 3% decrease in consumables costs mainly at Buzwagi due to lower reagents and chemicals costs as a result of lower cyanide usage, lower grinding media costs driven by the use of recycled grinding balls and lower explosives costs driven by increased spacing whilst blasting waste material, and the overall impact of negotiating more favourable prices on key consumables.
• A 6% increase in contracted services mainly as a result of increased contracted development at North Mara as a result of the ramp up in underground production combined with increased MARC charges at Buzwagi.
• General administration costs were in line with the prior year.

Capitalised direct mining costs, consisting of capitalised development costs and investment in inventory is made up as follows:

Capitalised development costs were 20% higher than H1 2015, driven by increased capitalised waste stripping costs related to the Nyabirama pit at North Mara, partly offset by lower underground development costs at Bulyanhulu. The investment in inventory was US$12.0 million, 22% lower than in H1 2015 due to the impact of lower average inventory valuations as a result of lower direct mining costs in combination with an increased drawdown of ore stock.

Central costs

Corporate administration expenses totalled US$9.8 million for H1 2016, a 47% decrease on 2015 (US$18.3 million) driven mainly by the impact of the corporate office restructuring and cost saving initiatives mainly around lower personnel, lower consulting fees and professional services and lower general administration costs. The increase in the share-based payment expense was a result of the stronger share price performance compared to H1 2015, specifically when compared to our peers and the global mining index, impacting on the valuation of share-based payment liabilities to employees. Over the first half of the year the Acacia share price increased by more than 150%.

Exploration and evaluation costs

Exploration and evaluation costs of US$11.2 million were incurred in H1 2016, 28% higher than the US$8.7 million spent in H1 2015. The key focus areas for the six months ended 30 June 2016 were exploration programmes at the West Kenya Joint Venture projects amounting to US$4.3 million and exploration programmes in Burkina Faso amounting to US$4.8 million.

Corporate social responsibility expenses

Corporate social responsibility costs incurred for H1 2016 amounted to US$4.6 million compared to the prior year period of US$5.3 million. The main projects for H1 2016 related to Village Benefit Implementation Agreements ("VBIAs") at North Mara and contributions to general community projects funded from the Acacia Maendeleo Fund amounting to US$2.6 million.

Other income

Other income in H1 2016 amounted to US$2.2 million, compared to an expense of US$11.8 million in H1 2015. The main contributors were: discounting of indirect tax credit of US$6.5 million as a result of increased profitability which positively impacts the recoverability of the MOS indirect tax receivable and Acacia's ongoing programme of zero cost collar contracts to mitigate the negative impact of copper, rand and fuel market volatility, in combination with zero cost collars relating to Buzwagi gold production, which resulted in a combined mark-to-market revaluation gain of US$1.4 million (as these arrangements do not qualify for hedge accounting these unrealised gains are recorded through profit and loss). The income was partly offset by (i) retrenchment costs of US$2.1 million, (ii) disallowed indirect taxes of US$0.9 million, and (iii) legal costs of US$0.7 million mainly relating to prior year legal fees.

Finance expense and income

Finance expense of US$5.4 million for H1 2016 was 17% lower than H1 2015 (US$6.5 million). The key components were borrowing costs relating to the Bulyanhulu tailings retreatment project (US$1.9 million) which are lower than the prior year due to a lower outstanding facility, accretion expenses relating to the discounting of the environmental reclamation liability (US$1.2 million) and US$1.1 million relating to the servicing of the US$150 million undrawn revolving credit facility. Other costs include bank charges and interest on finance leases.

Finance income relates predominantly to interest charged on non-current receivables and interest received on money market funds. Refer to note 7 of the condensed financial information for details.

Taxation matters

The taxation charge was US$107.7 million for H1 2016, compared to a charge of US$10.2 million in H1 2015. The tax charge was made up of current income tax for North Mara driven by year to date profitability, US$70 million provisions for uncertain tax positions raised for Bulyanhulu (US$35.0 million), North Mara (US$30.4 million) and Tulawaka (US$4.4 million) as a result of adverse tax rulings in Q1 2016, and deferred tax charges which reflects mainly the impact of the profitability on a year to date basis and the tax impact relating to the additional tax provisions raised. The effective tax rate in H1 2016 amounted to 106% compared to 41% in H1 2015. On an adjusted earnings basis, the effective tax rate in H1 2016 amounts to 37%.

Net loss and loss per share

As a result of the factors discussed above, the net loss for H1 2016 was US$6.1 million, against the prior year period profit of US$14.8 million. Higher gold sales volumes, lower cost of sales, corporate administration costs, other charges and finance costs, were offset by higher shared based payment costs and a higher tax expense.

The loss per share for H1 2016 amounted to US1.5 cents, a decrease of US5.1 cents from the prior year period earnings per share of US3.6 cents. The decrease was driven by the lower net profit, with no change in the underlying issued shares.

Adjusted net earnings

Adjusted net earnings of US$58.8 million compared to US$18.3 million in H1 2015. The factors impacting the net earnings in the year as described above has been adjusted for the impact of items such as prior year tax provisions and restructuring costs, as well as legal settlements recognised in the prior year. Refer to page 26 for a reconciliation between net loss and adjusted net earnings.

Financial position

Acacia had cash and cash equivalents on hand of US$284.4 million as at 30 June 2016 (US$233.3 million as at 31 December 2015). The Group's cash and cash equivalents are with counterparties whom the Group considers to have an appropriate credit rating. Location of credit risk is determined by physical location of the bank branch or counterparty. Investments are held mainly in United States dollars, with cash and cash equivalents in other foreign currencies maintained for operational requirements.

During 2013, a US$142 million facility ("Facility") was put in place to fund the bulk of the costs of the construction of the Bulyanhulu tailings retreatment project ("Project"). The Facility is collateralised by the Project, and has a term of seven years with a spread over Libor of 250 basis points. The seven year Facility is repayable in equal instalments (bi-annual) over the term of the Facility, after a two year repayment holiday period. The interest rate has been fixed at 3.6% through the use of an interest rate swap. The full facility of US$142 million was drawn in 2013 and the second repayment of US$14.2 million was made in H1 2016. At 30 June 2016, the outstanding capital balance is US$113.6 million (31 December 2015: US$127.8 million).

The above complements the existing undrawn revolving credit facility of US$150 million, which runs until November 2018.

The net book value of property, plant and equipment increased from US$1.39 billion as at 31 December 2015 to US$1.41 billion as at 30 June 2016. The main capital expenditure drivers have been explained in the cash flow used in the investing activities section below, and have been offset by depreciation charges of US$79.4 million. Refer to note 11 to the condensed financial information for further details.

Total indirect tax receivables, net of the impact of discounting applied to the non-current portion, decreased from US$110.2 million as at 31 December 2015 to US$109.1 million as at 30 June 2016. The decrease was mainly due to refunds received of US$37.4 million and the application of the first instalment of corporate tax prepayments of US$10.0 million against indirect tax receivables, which was offset by net indirect taxes paid of US$46.2 million and a reduction in the discounting provision for MOS indirect tax receivables of US$6.5 million.

The net deferred tax position increased from a liability of US$84.0 million as at 31 December 2015 to a liability of US$159.3 million as at 30 June 2016. This was mainly as a result of the tax provisions raised in Q1 2016 as discussed above which utilised some of the carry forward losses.

Net assets decreased from US$1.79 billion as at 31 December 2015 to US$1.77 billion as at 30 June 2016. The decrease reflects the current year loss of US$6.1 million and the payment of the final 2015 dividend of US$11.5 million.

Cash flow generation and capital management

Cash flow - continuing and discontinued operations

Cash flow from operating activities was US$157.1 million for H1 2016, an increase of US$50.0 million from H1 2015 (US$107.1 million). The increase relates to a higher operating profit due to higher gold sales volumes and lower operating costs, partly offset by unfavourable working capital outflows of US$6.3 million compared to inflows of US$15.3 million in 2015. The working capital outflow relates to a decrease in accounts payable due to the timing of payments and an increase in accounts receivable due to the timing of settlement of concentrate receivables. Also included is the impact of the first instalment of prepaid corporate tax of US$10.0 million as agreed with the Tanzanian Government and reported in Q1 2016, which have been offset against short term indirect tax receivables due for refund.

Cash flow used in investing activities was US$80.3 million for H1 2016, a decrease of 19% when compared to H1 2015 (US$99.5 million), driven by lower sustaining capital expenditure at Bulyanhulu and Buzwagi.

A breakdown of total capital and other investing capital activities for H1 2016 is provided below:

¹ Non-current asset movements relates to the movement in Tanzania government receivables and other long term assets.

Sustaining capital

Sustaining capital expenditure includes investments in tailings and infrastructure (US$9.6 million), investment in mobile equipment and component change-outs (US$5.0 million), investment in the Bulyanhulu winder upgrade (US$1.7 million) and other sustaining capital expenditure across sites of US$5.6 million. During the year, capital accruals from December 2015 of US$0.3 million were paid.

Expansionary capital

Expansionary capital expenditure consisted mainly of capitalised drilling at North Mara (US$0.5 million), combined with expansion drilling at Bulyanhulu (US$0.9 million).

Capitalised development

Capitalised development includes Bulyanhulu capitalised underground development (US$28.4 million) and capitalised stripping (US$22.6 million) and underground development (US$8.4 million) at North Mara.

Non-cash capital

Non-cash capital was US$20.4 million and consisted mainly of reclamation asset adjustments (US$19.2 million) and a decrease in capital accruals (US$0.3 million). The reclamation adjustments were driven by changes in US risk free rates driving lower discount rates.

Other investing capital

During H1 2016 North Mara incurred land purchases totalling US$2.8 million. This was offset by the amortisation of land prepayment balances.

Cash flow used in financing activities for H1 2016 was an outflow of US$25.7 million, an increase of US$13.4 million on an outflow of US$12.3 million in H1 2015. The outflow relates to payment of the final 2015 dividend of US$11.5 million and the payment of the second capital instalment of the borrowings related to the Bulyanhulu tailings retreatment project of US$14.2 million.

Dividend

The final 2015 dividend of US2.8 cents per share was paid to shareholders on 27 May 2016. The Board of Directors have recommended an interim dividend for 2016 of US2.0 cents per share, payable to shareholders in September 2016.

Significant judgements in applying accounting policies and key sources of estimation uncertainty

Many of the amounts included in the condensed consolidated financial information require management to make judgements and/or estimates. These judgements and estimates are continuously evaluated and are based on management's experience and best knowledge of the relevant facts and circumstances, but actual results may differ from the amounts included in the condensed consolidated financial information included in this release. Information about such judgements and estimation is included in the accounting policies and/or notes to the consolidated financial statements, and the key areas are summarised below.

Areas of judgement and key sources of estimation uncertainty that have the most significant effect on the amounts recognised in the condensed consolidated financial statements include:

• Estimates of the quantities of proven and probable gold and copper reserves;
• Estimates included within the life-of-mine planning such as the timing and viability of processing of long term stockpiles
• The capitalisation of production stripping costs;

• The capitalisation of exploration and evaluation expenditures;
• Review of goodwill, tangible and intangible assets' carrying value, the determination of whether a trigger for an impairment review exist, whether these assets are impaired and the measurement of impairment charges or reversals, and also includes the judgement of reversal of any previously recorded impairment charges;
• The estimated fair values of cash generating units for impairment tests, including estimates of future costs to produce proven and probable reserves, future commodity prices, foreign exchange rates and discount rates;
• The estimated useful lives of tangible and long-lived assets and the measurement of depreciation expense;
• Property, plant and equipment held under finance leases;
• Recognition of a provision for environmental rehabilitation and the estimation of the rehabilitation costs and timing of expenditure;
• Whether to recognise a liability for loss contingencies and the amount of any such provision;
• Whether to recognise a provision for accounts receivable, and in particular the indirect tax receivables from the Tanzanian Government, a provision for obsolescence on consumables inventory and the impact of discounting the non-current element of the indirect tax receivable;
• Recognition of deferred income tax assets, amounts recorded for uncertain tax positions, the measurement of income tax expense and indirect taxes;
• Determination of the cost incurred in the productive process of ore stockpiles, gold in process, gold doré/bullion and concentrate, as well as the associated net realisable value and the split between the long term and short term portions;
• Determination of fair value of derivative instruments; and
• Determination of fair value of share options and cash-settled share-based payments.

Non-IFRS Measures

Acacia has identified certain measures in this report that are not measures defined under IFRS. Non-IFRS financial measures disclosed by management are provided as additional information to investors in order to provide them with an alternative method for assessing Acacia's financial condition and operating results. These measures are not in accordance with, or a substitute for, IFRS, and may be different from or inconsistent with non-IFRS financial measures used by other companies. These measures are explained further below.

Average realised gold price per ounce sold is a non-IFRS financial measure which excludes from gold revenue:

• Unrealised mark-to-market gains and losses on provisional pricing from copper and gold sales contracts; and
• Export duties.

Average realised gold price per ounce sold is calculated by taking the above calculated revenue and dividing by ounces sold.

Cash cost per ounce sold is a non-IFRS financial measure. Cash costs include all costs absorbed into inventory, as well as royalties, and production taxes, and exclude capitalised production stripping costs, inventory purchase accounting adjustments, unrealised gains/losses from non-hedge currency and commodity contracts, depreciation and amortisation and corporate social responsibility charges. Cash cost is calculated net of co-product revenue. Cash cost per ounce sold is calculated by dividing the aggregate of these costs by total ounces sold.

The presentation of these statistics in this manner allows Acacia to monitor and manage those factors that impact production costs on a monthly basis. Cash costs and cash cost per ounce sold are calculated on a consistent basis for the periods presented.

The table below provides a reconciliation between cost of sales and total cash cost to calculate the cash cost per ounce sold.

* Depreciation and amortisation includes the depreciation component of the cost of inventory sold

All-in sustaining cost (AISC) is a non-IFRS financial measure. The measure is in accordance with the World Gold Council's guidance issued in June 2013. It is calculated by taking cash cost per ounce sold and adding corporate administration costs, share-based payments, reclamation and remediation costs for operating mines, corporate social responsibility expenses, mine exploration and study costs, realised gains and/or losses on operating hedges, capitalised stripping and underground development costs and sustaining capital expenditure. This is then divided by the total ounces sold. A reconciliation between cash cost per ounce sold and AISC for the key business segments is presented below:

* The group total includes US$66/oz of unallocated costs for corporate related costs in Q2 2016 and a cost of US$41/oz in Q2 2015

* The group total includes US$46/oz of unallocated costs for corporate related costs in H1 2016 and US$31/oz in H1 2015

AISC is intended to provide additional information on the total sustaining cost for each ounce sold, taking into account expenditure incurred in addition to direct mining costs and selling costs.

Cash cost per tonne milled is a non-IFRS financial measure. Cash costs include all costs absorbed into inventory, as well as royalties, co-product credits, and production taxes, and exclude capitalised production stripping costs, inventory purchase accounting adjustments, unrealised gains/losses from non-hedge currency and commodity contracts, depreciation and amortisation and corporate social responsibility charges. Cash cost is calculated net of co-product revenue. Cash cost per tonne milled are calculated by dividing the aggregate of these costs by total tonnes milled.

EBITDA is a non-IFRS financial measure. Acacia calculates EBITDA as net profit or loss for the period excluding:

• Income tax expense;
• Finance expense;
• Finance income;
• Depreciation and amortisation; and
• Impairment charges of goodwill and other long-lived assets.

EBITDA is intended to provide additional information to investors and analysts. It does not have any standardised meaning prescribed by IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. EBITDA excludes the impact of cash costs of financing activities and taxes, and the effects of changes in operating working capital balances, and therefore is not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate EBITDA differently.

A reconciliation between net profit for the period and EBITDA is presented below:

^{*Depreciation and amortisation includes the depreciation component of the cost of inventory sold.}

Adjusted EBITDA is a non-IFRS financial measure. It is calculated by excluding one-off costs or credits relating to non-routine transactions from EBITDA. It excludes other credits and charges that, individually or in aggregate, if of a similar type, are of a nature or size that requires explanation in order to provide additional insight into the underlying business performance. EBITDA is adjusted for items (a) to (e) as contained in the reconciliation to adjusted net earnings below.

EBIT is a non-IFRS financial measure and reflects EBITDA adjusted for depreciation and amortisation and goodwill impairment charges.

Adjusted net earnings is a non-IFRS financial measure. It is calculated by excluding certain costs or credits relating to non-routine transactions from net profit attributed to owners of the parent. It includes other credit and charges that, individually or in aggregate, if of a similar type, are of a nature or size that requires explanation in order to provide additional insight into the underlying business performance.

Adjusted net earnings and adjusted earnings per share have been calculated as follows:

¹ For the six months ended 30 June 2016, US$69.9 million represents a provision raised for the implied impact of an adverse tax ruling made by the Tanzanian Court of Appeal with respect to historical tax assessments of Bulyanhulu. As reported in Q1 2016, the impact of the ruling was calculated for Bulyanhulu and extrapolated to North Mara and Tulawaka as well and covers results up to the end of 2015. On a site basis, US$35.1 million was raised for Bulyanhulu, US$30.4 million for North Mara and US$4.4 million for Tulawaka.

Adjusted net earnings per share is a non-IFRS financial measure and is calculated by dividing adjusted net earnings by the weighted average number of Ordinary Shares in issue.

Free cash flow is a non-IFRS measure and represents the change in cash and cash equivalents in a given period.

Net cash is a non-IFRS measure. It is calculated by deducting total borrowings from cash and cash equivalents.

Mining statistical information

The following describes certain line items used in the Acacia Group's discussion of key performance indicators:

• Open pit material mined - measures in tonnes the total amount of open pit ore and waste mined.
• Underground ore tonnes hoisted - measures in tonnes the total amount of underground ore mined and hoisted.
• Underground ore tonnes trammed - measures in tonnes the total amount of underground ore mined and trammed.
• Total tonnes mined includes open pit material plus underground ore tonnes hoisted.
• Strip ratio - measures the ratio of waste?to?ore for open pit material mined.
• Ore milled - measures in tonnes the amount of ore material processed through the mill.
• Head grade - measures the metal content of mined ore going into a mill for processing.
• Milled recovery - measures the proportion of valuable metal physically recovered in the processing of ore. It is generally stated as a percentage of the metal recovered compared to the total metal originally present.

Risk Review

We have made a number of further developments in the identification and management of our risk profile over the course of H1 2016. Where appropriate, risk ratings have been reviewed against risk management controls and other mitigating factors. Our principal risks continue to be within four broad categories: strategic risks, financial risks, external risks and operational risks. While the overall makeup of our principal risks has not significantly changed from that published in the 2015 Annual Report, there have been changes in certain risk profiles as a result of developments in our operating environment and developments or trends affecting the wider global economy and/or the mining industry. As a result of our mid-year assessment, at this stage we believe it appropriate to combine occupational health risks and the monitoring of safety risks relating to mining operations and have amended the relevant principal risk accordingly.

As a result of the risk review outlined above, for the remainder of 2016 we view our principal risks as relating to the following:

• Political, legal and regulatory developments
• Single country risk
• Security, trespass and vandalism
• Environmental hazards and rehabilitation
• Implementation of enhanced operational systems
• Significant changes to commodity prices
• Continuity of power supply
• Equipment effectiveness
• Health & Safety risks relating to mining operations

Further details as regards Acacia principal risks are provided as part of the 2015 Annual Report.

Directors' Responsibility Statement

The Directors confirm that, to the best of their knowledge, the condensed consolidated interim financial information has been prepared in accordance with IAS 34 as adopted by the European Union. The half-year management report includes a fair review of the information required by Disclosure and Transparency Rule 4.2.7R and Disclosure and Transparency Rule 4.2.8R, namely:

• an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed consolidated interim financial information, and a description of the principal risks and uncertainties for the remaining six months of the financial year; and
• material related-party transactions in the first six months of the financial year and any material changes in the related party transactions described in the last Annual Report.

The Directors of Acacia Mining plc are listed in the Acacia Mining plc Annual Report for 31 December 2015, save for Mr Graham Clow who stepped down as director at the 2016 AGM. A list of current Directors is maintained on the Acacia Mining plc Group website: www.acaciamining.com.

On behalf of the Board

Auditor's Review Report

Independent review report to Acacia Mining plc

Report on the condensed consolidated interim financial information

Our conclusion

We have reviewed Acacia Mining plc's condensed consolidated interim financial information (the "interim financial statements") in the half-yearly financial report of Acacia Mining plc for the 6 month period ended 30 June 2016. Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.

What we have reviewed

The interim financial statements comprise:

• the consolidated balance sheet as at 30 June 2016;
• the consolidated income statement and consolidated statement of comprehensive income for the period then ended;
• the consolidated statement of cash flows for the period then ended;
• the consolidated statement of changes in equity for the period then ended; and
• the explanatory notes to the interim financial statements.

The interim financial statements included in the half-yearly financial report have been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.

As disclosed in note 2 to the interim financial statements, the financial reporting framework that has been applied in the preparation of the full annual financial statements of the Group is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

Responsibilities for the interim financial statements and the review

Our responsibilities and those of the directors

The half-yearly financial report, including the interim financial statements, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority.

Our responsibility is to express a conclusion on the interim financial statements in the half-yearly financial report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Rules and Transparency Rules of the United Kingdom's Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

What a review of interim financial statements involves

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial statements.

PricewaterhouseCoopers LLP

Chartered Accountants

London

21 July 2016

1. The maintenance and integrity of the Acacia Mining plc website is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the interim financial statements since they were initially presented on the website.
2. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Condensed Financial Information

Consolidated income statement

The notes on pages 35 to 48 are an integral part of this financial information.

Consolidated statement of comprehensive income

The notes on pages 35 to 48 are an integral part of this financial information.

Consolidated balance sheet

The notes on pages 35 to 48 are an integral part of this financial information.

Statement of changes in equity

The notes on pages 35 to 48 are an integral part of this financial information.

Consolidated statement of cash flows

The notes on pages 35 to 48 are an integral part of this financial information.

Notes to the condensed financial information

1. General Information

Acacia Mining plc, formerly African Barrick Gold plc (the "Company", "Acacia" or collectively with its subsidiaries the "Group") was incorporated on 12 January 2010 and re-registered as a public limited company on 12 March 2010 under the Companies Act 2006. It is registered in England and Wales with registered number 7123187.

On 24 March 2010 the Company's shares were admitted to the Official List of the United Kingdom Listing Authority ("UKLA") and to trading on the Main Market of the London Stock Exchange, hereafter referred to as the Initial Public Offering ("IPO"). The address of its registered office is No.1 Cavendish Place, London, W1G 0QF.

Barrick Gold Corporation ("Barrick") currently owns approximately 63.9% of the shares of the Company and is the ultimate parent and controlling party ofthe Group. The financial statements of Barrick can be obtained from www.barrick.com.

The condensed consolidated interim financial information for the six months ended 30 June 2016 was approved for issue by the Board of Directors of the Company on 21 July 2016. Statutory accounts for the year ended 31 December 2015 were approved by the Board of Directors on 8 March 2016 and delivered to the Registrar of Companies. The report of the auditors' on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006. The condensed consolidated interim financial information has been reviewed, not audited. The condensed consolidated interim financial information does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2008.

The Group's primary business is the mining, processing and sale of gold. The Group has three operating mines located in Tanzania. The Group also has a portfolio of exploration projects located across Africa.

2. Basis of Preparation of the condensed financial information

The condensed consolidated interim financial information for the six months ended 30 June 2016 has been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, 'Interim Financial Reporting' as adopted by the European Union. The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2015, which have been prepared in accordance with IFRS as adopted by the European Union.

The condensed consolidated interim financial information has been prepared under the historical cost basis, as modified by the revaluation of financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

The financial information is presented in US dollars (US$) and all monetary results are rounded to the nearest thousand (US$'000) except when otherwise indicated.

Where a change in the presentational format between the prior period and the current period financial information has been made during the period, comparative figures have been restated accordingly. No presentational changes were made in the current period.

The group's activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The condensed interim financial statements do not include all financial risk management information and disclosures required in the annual financial statements; they should be read in conjunction with the group's annual financial statements as at 31 December 2015. There have been no changes in the risk management department or in any risk management policies since the year end.

The impact of the seasonality on operations is not considered as significant on the condensed consolidated interim financial information.

After making the appropriate enquiries, the Directors confirm that they have a reasonable expectation that the Acacia Group will continue to operate and meet its liabilities, as they fall due, for the next three years. The Directors' assessment has been made with reference to the Acacia Group's current position and prospects, its strategy and the Acacia Group's principal risks and how these are managed, with particular regard to those which are viewed as having the most relevance to Acacia continuing in operation, when assessed in terms of financial and operational planning and impact over a three-year period, being: environmental hazards and rehabilitation; implementation of enhanced operational systems; significant change to commodity prices; political, legal and regulatory developments; safety risks relating to mining operations and equipment effectiveness. On this basis this condensed consolidated interim financial information is presented on a going concern basis.

3. Accounting Policies

The accounting policies adopted are consistent with those used in the Acacia Mining plc annual financial statements for the year ended 31 December 2015.

There are no new standards, interpretations or amendments to standards issued and effective for the period which materially impacted on the Group.

The following exchange rates to the US dollar have been applied:

4. Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2015.

5. Segment Reporting

The Group has only one primary product produced in a single geographic location, being gold produced in Tanzania. In addition the Group produces copper and silver as a co-product. Reportable operating segments are based on the internal reports provided to the Chief Operating Decision Maker ("CODM") to evaluate segment performance, decide how to allocate resources and make other operating decisions. After applying the aggregation criteria and quantitative thresholds contained in IFRS 8, the Group's reportable operating segments were determined to be: North Mara gold mine; Bulyanhulu gold mine; Buzwagi gold mine; a separate Corporate and Exploration segment, which primarily consists of costs related to other charges and corporate social responsibility expenses.

Segment results and carrying values include items directly attributable to the segment as well as those that can be allocated on a reasonable basis. Segment carrying values are disclosed and calculated as shareholders equity after adding back debt and intercompany liabilities, and subtracting cash and intercompany assets. Capital expenditures comprise of additions to property, plant and equipment. The Group has also included segment cash costs and all-in sustaining cost per ounce sold.

Segment information for the reportable operating segments of the Group for the periods ended 30 June 2016, 30 June 2015 and 31 December 2015 is set out below.

^{1 The CODM reviews cash operating costs for the three operating mine sites separately from corporate administration costs and exploration costs. Consequently, the Group has reported these costs in this manner.}

^{2 These are non-IFRS financial performance measures with no standard meaning under IFRS. Refer to 'Non IFRS measures' on page 24 for definitions.}

^{3 Segment carrying values are calculated as shareholders equity after adding back debt and intercompany liabilities, and subtracting cash and intercompany assets and include outside shareholders' interests.}

^{4 Depreciation and amortisation includes the depreciation component of the cost of inventory sold.}

6. Other Charges

7. Finance Income and Expenses

a)Finance income

b)Finance expense

1. ^{The unwinding of discount is calculated on the environmental rehabilitation provision.}

^{Included in credit facility charges are the amortisation of the fees related to the revolving credit facility as well as the monthly interest and facility fees.}

^{8. Tax Expense}

¹ Included in this amount is a provision for uncertain tax positions of US$30.4 million relating to North Mara, and US$4.4 million relating to Tulawaka, following an adverse tax ruling as reported in Q1 2016.

² Included in this amount is a provision for uncertain tax positions of US$35.0 million relating to Bulyanhulu following an adverse tax ruling, as reported in Q1 2016.

The tax on the Group's profit before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to the profits of the consolidated entities as follows:

^{1 Included in the December 2015 reconciliation is the tax impact of US$42.5 million of deferred tax assets derecognised at Buzwagi following the impairment review.}

^{2 The reconciliation includes an amount of US$69.9 million relating to an increase in the amount of unrecognised tax liabilities carried forward. The adjustment reflects uncertainty regarding recoverability of certain tax losses, and gives rise to an increased deferred tax charge.}

Tax periods remain open to review by the Tanzanian Revenue Authority (TRA) in respect of income taxes for five years following the date of the filing of the corporate tax return, during which time the authorities have the right to raise additional tax assessments including penalties and interest. Under certain circumstances the reviews may cover longer periods. Because a number of tax periods remain open to review by tax authorities, there is a risk that transactions that have not been challenged in the past by the authorities may be challenged by them in the future, and this may result in the raising of additional tax assessments plus penalties and interest.

9. (Loss)/ earnings Per Share (EPS)

Basic EPS is calculated by dividing the net (loss)/ profit for the period attributable to owners of the Company by the weighted average number of Ordinary Shares in issue during the year.

Diluted earnings per share is calculated by adjusting the weighted average number of Ordinary Shares outstanding to assume conversion of all dilutive potential Ordinary Shares. The Company has dilutive potential Ordinary Shares in the form of stock options. The weighted average number of shares is adjusted for the number of shares granted assuming the exercise of stock options.

At 30 June 2016, 30 June 2015 and 31 December 2015, (loss)/ earnings per share have been calculated as follows:

10. Dividends

The final dividend declared in respect of the year ended 31 December 2015 of US$11.5 million (US2.8 cents per share) was paid during 2016.

11. Property, Plant and Equipment

^{1 Assets under construction represents (a) sustaining capital expenditures incurred constructing property, plant and equipment related to operating mines and advance deposits made towards the purchase of property, plant and equipment; and (b) expansionary expenditure allocated to a project on a business combination or asset acquisition, and the subsequent costs incurred to develop the mine. Once these assets are ready for their intended use, the balance is transferred to plant and equipment and/or mineral properties and mine development costs.}

^{2 The impairment in December 2015 relates to property, plant and equipment at Buzwagi.}

Leases

Property, plant and equipment includes assets relating to the design and construction costs of power transmission lines and related infrastructure. At completion, ownership was transferred to TANESCO in exchange for amortised repayment in the form of reduced electricity supply charges. No future lease payment obligations are payable under these finance leases.

In 2014, property, plant and equipment included emergency back-up and spinning power generators leased at the Buzwagi mine under a three-year lease agreement, with an option to purchase the equipment at the end of the lease term. These leases were classified as finance leases. In 2015 the option to purchase was not exercised, but a new operating lease arrangement was entered into.

Property, plant and equipment also includes five drill rigs purchased under short-term finance leases.

The following amounts were included in property, plant and equipment where the Group is a lessee under a finance lease:

12. Derivative Financial Instruments

The table below analyses financial instruments carried at fair value, by valuation method. The Group has derivative financial instruments in the form of economic and cash flow hedging contracts which are all defined as level two instruments as they are valued using inputs other than quoted prices that are observable for the assets or liabilities. The following tables present the group's assets and liabilities that are measured at fair value at 30 June 2016, 30 June 2015 and 31 December 2015.

13. Borrowings

During 2013, a US$142 million facility was put in place to fund the bulk of the costs of the construction of one of Acacia's key growth projects, the Bulyanhulu CIL Expansion project ("Project"). The Facility is collateralised by the Project, has a term of seven years with a spread over Libor of 250 basis points. The interest rate has been fixed at 3.6% through the use of an interest rate swap. The 7 year Facility is repayable in equal bi-annual instalments over the term of the Facility, after a two year repayment holiday period. The full facility of US$142 million was drawn at the end of 2013. The first principal payment of US$14.2 million was paid in H2 2015 and as at 30 June 2016 the balance owing was US$113.6 million. Interest accrued to the value of US$0.6 million was included in accounts payable for the period end. Interest incurred on the borrowings as well as hedging losses on the interest rate swap for the six months ended 30 June 2016 was US$1.9 million.

14. Commitments and Contingencies

The Group is subject to various laws and regulations which, if not observed, could give rise to penalties. As at 30 June 2016, the Group has the following commitments and/ or contingencies.

1. Legal contingencies

As at 30 June 2016, the Group was a defendant in approximately 255 lawsuits. The plaintiffs are claiming damages and interest thereon for the loss caused by the Group due to one or more of the following: unlawful eviction, termination of services, wrongful termination of contracts of service, non-payment for services, defamation, negligence by act or omission in failing to provide a safe working environment, unpaid overtime and public holiday compensation.

The total amounts claimed from lawsuits in which specific monetary damages are sought amounted to US$234.9 million. The Group's Legal Counsel is defending the Group's current position, and the outcome of the lawsuits cannot presently be determined. However, in the opinion of the Directors and Group's Legal Counsel, no material liabilities are expected to materialise from these lawsuits that have not already been provided for.

Included in the total amounts claimed is a claim for US$115 million by Bismark Hotel Limited alleging breach of contract arising from an Optional Agreement signed in 1995. The claim relates to an application for a prospecting licence with no attributable reserves, resources or value. We are waiting for the adjudicators to fix a hearing date. Management are of the opinion that the claim does not have substance and that it will be successfully defended.

NMGML and Diamond Motors Ltd (DML) have entered into arbitration over the interpretation of drilling contracts entered into by the parties, relating to periodic rate review and other provisions of the contracts. The award was delivered on 10 August 2015, with the Tribunal determining an award of US$4 million against the final claimed amount of US$25 million. This award was consistent with NMGML's position in relation to the arbitration and the full amount has been provided for. DML on 31 December 2015 filed a Petition at the High Court to challenge the award. On 23 March 2016 we filed a petition to stay proceedings pending arbitration. On 10 June 2016, the court ruled that hearing of the winding up should proceed. We are challenging the ruling of the court and have already filed a notice of appeal on 17 June 2016. As a consequence, we asked the court to stay the proceedings in winding up pending outcome of the appeal. The court gave that on 23 June 2016.

Bulyanhulu Gold Mine Limited (BGML) and the contractor responsible for the engineering, procurement and construction of the CIL plant have entered into arbitration in relation to delay damages and other alleged breaches of contract relating to project execution. Management are of the opinion that the Contractor's claims are defensible and/or without merit.

1. Tax-related contingencies

The TRA has issued a number of tax assessments to the Group related to past taxation years from 2002-onwards. The Group believes that these assessments are incorrect and has filed objections to each of them. The Group is attempting to resolve these matters by means of discussions with the TRA or through the Tanzanian appeals process. These include an appeal by the TRA against a tax assessed of US$21.3 million in respect of Tusker Gold Limited. The tax assessment is based on the sales price of the Nyanzaga property of US$71 million multiplied by the tax rate of 30%. Management is of the view that the assessment is invalid due to the fact that the acquisition is for Tusker Gold Limited, a company incorporated in Australia. The shareholding of the Tanzanian related entities did not change and the Tusker Gold Limited group structure remains the same as prior to the acquisition. The case was decided in favour of Acacia however the TRA appealed that decision. The tax tribunal upheld the decision in favour of Acacia however the TRA has appealed to the Court of Appeal. We are awaiting a hearing date to be set.

The TRA raised claims to the value of US$41.3 million for withholding tax on historic offshore dividend payments paid by Acacia Mining plc to its shareholders. The TRA have also issued tax assessments to Acacia Mining to the value of US$500.7 million. These claims are made on the basis that Acacia is resident in Tanzania for tax purposes. The corporate tax assessments have been levied on the Group net profits before tax. On 31 March 2016, the appeal case in relating to the dividend payments was heard by the Tax Revenue Appeals Tribunal and a judgment was delivered in favour of the TRA. An appeal to the Court of Appeal has been filed in this case. A stay of execution has been applied for and granted by the Tax Revenue Appeals Board in relation to the corporate tax assessment. Management are of the opinion that the claims do not have substance and that they will be successfully defended in the Court of Appeal.

15. Related party balances and transactions

The Group has related party relationships with entities owned or controlled by Barrick Gold Corporation, which is the ultimate controlling party of the Group.

The Company and its subsidiaries, in the ordinary course of business, enter into various sales, purchase and service transactions and other professional services arrangements with others in the Barrick Group. These transactions are under terms that are on normal commercial terms and conditions. These transactions are not considered to be significant.

At 30 June 2016 the Group had no loans of a funding nature due to or from related parties (30 June 2016: zero; 30 June 2015: zero; 31 December 2015: zero).

16. Post Balance Sheet Events

The Board of the Company has approved an interim dividend of US2.0 cents per share for this financial year to be paid on 30 September 2016 to shareholders on the register on 2 September 2016.