Lachlan Star Limited — Capital/Financing Update 2003

Nov 5, 2003

ASX Announcement

6 November 2003

NUMIS APPOINTED AS AIM BROKER

Gympie Gold today appointed Numis Securities Ltd as its Nominated Broker in the United Kingdom. Numis has a strong record of supporting successful AIM-listed companies and recently established a strong presence in the resources equities sector.

Gympie Gold is dual-listed on ASX (Code "GYM") and AIM (Code "GGD") and is an Australian mining exploration, production and marketing company with two core businesses: coking coal and gold. Gympie Gold is perhaps the only company highly leveraged to both of these strong sectors. The prices for metallurgical coal and gold are firm and currently appear to have strong upside potential.

Gympie's 90%-owned Southland Coal has recently upgraded its production machinery during the move to a new longwall panel. Southland's run-of-mine output over the past week has been 64,000 tonnes and production for the first four months of the 2003/04 financial year was 102,000 tonnes above budget. This performance indicates that an increase in annual output to over 2 million tonnes per annum can now be targeted. Coal sales have also grown from 247,000 tonnes in the March 2003 quarter to 591,000 tonnes in the September 2003 quarter and are expected to grow further in the December quarter.

The wholly-owned Gympie Eldorado Gold project has recently expanded its tenement holdings over key targets around the prolific, high-grade Gympie Goldfield where smallscale production is currently yielded from exploratory underground development.

Over the six months to 30 September Gympie Gold spent \$8 million upgrading Southland's coal production equipment and built up coal stock and debtors worth approximately \$30 million. The continuing improvement of operational performance is expected to assist with the intended replacement of current short-term loan facilities with longer term banking arrangements. This refinancing remains a priority so as to allow the Company to more easily pursue its growth ambitions.

Gympie Gold's Managing Director, Mr Harry Adams said "the appointment of Numis as lead-broker in the UK reflects the priority we place on pushing ahead with organic growth opportunities at the same time as positioning the Company to pursue corporate growth opportunities, should they prove worthwhile after being fully evaluated. A number of such opportunities are currently being evaluated within the strategy to also reduce the level of the Company's gearing".

For Further Information Contact:

Harry Adams, Managing Director 02 9251 2777 or international +61 2 9251 2777

Electronic copies of this report are available on website www.gympiegold.com.au Requests to be placed on email circulation list can be emailed to info@gympiegold.com.au