News Announcements

YELLOWCAKE PLC

("YELLOWCAKE" OR THE "COMPANY")

PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 2008

27 November 2008

HIGHLIGHTS:

* Uranium spot price down 56.6% in the period
* A second resurgence foreseen in the future for the uranium mining industry
* Strong progress at the Grease River project, Athabasca Basin, Canada

CHAIRMAN'S STATEMENT

At the commencement of the period under review, the market spot price for uranium ("U3O8"), which had been US$7.20 in December 2002, reached an all-time high of US$136 per pound on 1 July 2007. The main factors behind this near-vertiginous rise in market prices were reactions of utility buyers to the production problems encountered during 2007 coupled with the arrival of uranium investment funds whose buying exacerbated supply shortages.

By the end of the period under review, the market price had reacted to US$59 per pound on 30 June 2008, a diminution of 56.6%. During the year, world production stabilised, the funds sold part of their uranium stocks and, with inventories rebuilt, Utilities restrained their buying of Spot material to more normal levels.

Additionally, from mid-August 2007, the world credit crunch began to adversely affect the share prices of all commodity stocks as institutional investors and especially hedge funds sold down stocks indiscriminately in the hunt for liquidity.

The investment climate for uranium mining companies in which Yellowcake was invested, based on the highly visible spot price, thus deteriorated during the period under review.

Yellowcake modified its portfolio structure during these difficult conditions to mitigate the effect of these market forces, reducing the percentage of exploration and development companies in the portfolio in favour of producers who have revenue and cash-flow. By the end of the period producing and near-producing companies comprised 28.8% of the portfolio (2007: 16.7%).

The net result has been that the aggregate market value of Yellowcake's portfolio was reduced by 32% during the year under review compared with the reduction of 56.6% in the Spot Price. A pre-tax loss of £69,719 was made compared with £192,169 pre-tax profit in the previous year.

Uranium is an essential commodity; nuclear power stations cannot be run without fuel. At the end of August 2008, according to The World Nuclear Association, a total of 36 new nuclear stations were under construction in addition to the 439 operating stations globally, with 99 new reactors planned with funding and 232 proposed. These figures include the six new reactors announced by the UK Government upon the acquisition of British Energy by EDF in September 2008.

The International Energy Agency (IEA) released its 2008 World Energy Outlook (WEO) on 13 November 2008. The WEO projects that limiting the global temperature rise to 2°C will require large increases in nuclear power in addition to contributions from various other energy sources. This will necessitate an increase of world nuclear generation capacity by a factor of 1.8 from 368GW in 2006 to 680GW by 2030.

The leading authority on the uranium market, Ux Consulting, estimates that instead of the projected increase in production of uranium in 2007, last year's world availability of uranium including secondary sources at 159,000 pounds was less than in 2006. In September 2008, when commenting on current supply conditions, Ux stated "On the supply side, Cameco's announcement that McArthur River/Key Lake production may be about 1 million pounds under the 18.7 million pound U3O8 target for 2008 is certainly not positive news". On 22 October 2008, Uranium One announced that its Dominion uranium mine in South Africa, expected to produce 1m lbs in 2009, would now be put on a care and maintenance status. Faced with further supply shortages, the Spot Price, which had fallen to a low of US$44 a pound by 20 October, has subsequently reacted upwards to US$55.

With the ending of the USA-Russia agreement for the supply of down-blended uranium from 2013, severe shortages are forecast for the period thereafter. According to a Deutsche Bank forecast, the biggest impediment to achieving the IEA targets is not global legislation change but the potential inability of global supply to respond to increased demand from 2015.

In the US, which with 104 operating stations is the world's largest generator of nuclear-powered electricity, approvals and permits are now under way for both new stations and new mines. Following the 2005 Energy Policy Act, nuclear power operators are now also applying for part of the US$18.5 billion in allocated government loan guarantees for new nuclear station construction. On 17 September, in a vote of confidence in the US nuclear industry, legendary investor Warren Buffett's energy holding company bought Constellation Energy, the country's biggest wholesale power seller which generates 60% of its power from nuclear energy and is among those generators applying for more stations.

We therefore foresee a "second coming" of the world nuclear resurgence which commenced in 2003.

DIRECT EXPLORATION IN THE ATHABASCA BASIN, SASKATCHEWAN, CANADA

Our investment in our direct project in Grease River has continued to make exciting progress. In September and November 2007, our Canadian partners CanAlaska Uranium reported on the initial exploration work as part of the 2007 season programme. 250 anomalies for ground prospecting were identified as a result of the 6,900 line-km airborne survey carried out in July 2007. Ground prospecting in July-September 2007 identified 13 target zones for follow-up work and in March 2008 CanAlaska reported assay results showing high concentrations of uranium mineralisation up to 3.53% uranium at surface.

Yellowcake retains a 9% interest in an Option over the project, along with Uranium Prospects plc (51%) and CanAlaska Uranium (40%). The parties are enthusiastic about prospects for the 2008 summer field season programme, designed to further geologically investigate each target anomaly in order to evaluate its potential as a drill target. The significance of the anomalous values of some Rare Earth Elements reported within the Project area will also form part of this programme. Further results are pending.

POST BALANCE-SHEET STRATEGY DEVELOPMENTS

As a result of the increasingly oversold market for uranium shares and the promising results expected to be achieved at Grease River, the Board decided to liquidate its shares portfolio in August 2008 and use the proceeds to bolster the funds available to Uranium Prospects plc which is responsible for the funding of the Grease River exploration. This sale raised cash of £199,952, resulting in a loss of £37,571 against the book value of these stocks as at 30 June 2008. As a result Yellowcake now holds £231,500 in Loan Agreements from Uranium Prospects.

Robert Wallace stepped down as CEO in July 2008 and is now acting as an advisor to Yellowcake on the uranium market on a short term agreement expiring 30 November 2008. The Company is currently in discussions with Robert with a view to extending this arrangement. The Board would like to pay tribute to Robert's invaluable contribution made whilst a Director of the Company.

Further information:

Yellowcake Plc
Mark Watson-Mitchell, Executive Chairman
Email: mark@yellowcakeplc.co.uk
Tel: 020 7638 8750

St Helen's Capital Plc
Duncan Vasey, Director
Email: Duncan.vasey@sthelenscapital.com
Tel: 020 7628 5582

The Directors of Yellowcake plc accept responsibility for this announcement.