<PAGE>   1

                                                       [LOGO] Campbell
                                                              Resources Inc.

                                                              1998 Annual Report

                                [PHOTO OMITTED]
<PAGE>   2

                                 [MAP OMITTED]

                               Corporate Profile
--------------------------------------------------------------------------------

   Campbell Resources Inc. is a gold mining and exploration company. In 1998,
   Campbell produced 82,400 ounces of gold from the Joe Mann Mine in Quebec,
Canada, and the Santa Gertrudis Mine in Sonora, Mexico. The Santa Gertrudis Mine
 temporarily ceased mining in December 1997 and is now focussed on exploration.
  Campbell also owns the Cerro Quema development stage gold project in Panama,
  which is currently awaiting higher gold prices before development continues.

 Campbell operates in a financially responsible manner and as a consequence has
  maintained a strong balance sheet with cash and short-term deposits of $41.5
   million and negligible debt. Continuing with this philosophy, Campbell is
selectively developing its existing assets and continuing to search for quality
                         gold investment opportunities.

Campbell's common shares are listed on the New York, Toronto, and Montreal stock
                   exchanges, trading under the symbol "CCH".

--------------------------------------------------------------------------------

                           Forward-Looking Statements

Certain information contained in this report contains "Forward-Looking
Statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 and is subject to certain risks and uncertainties, including those "Risk
Factors" set forth in the Company's current Annual Report on Form 10-K for the
year ended December 31, 1998. Such factors include, but are not limited to:
differences between estimated and actual ore reserves; changes to exploration,
development and mining plans due to prudent reaction of management to ongoing
exploration results, engineering and financial concerns; and fluctuations in the
gold price which affect the profitability and ore reserves of the Company.
Readers are cautioned not to place undue reliance on these forward-looking
statements which speak only as of the date hereof. The Company undertakes no
obligation to release publicly any revisions to these forward-looking statements
to reflect events or circumstances after the date hereof or to reflect
unanticipated events or developments.
<PAGE>   3

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

      Highlights
----------------

o     Maintained a strong balance sheet with a cash position of $41.5 million
      and working capital of $45.7 million

      Joe Mann Mine
-------------------------------------------------------------------------------
o     Produced 70,100 ounces at a cash operating cost of US$257 per ounce

o     Completed the shaft deepening project at a cost of $13.1 million compared
      to a budget of $14.5 million

o     Discovered new high grade ore zone that is open on strike and at depth

o     Implemented a new long-term mine plan that increases the number of mine
      work days per year by 45% and reduces the cash operating costs to US$245
      per ounce

      Santa Gertrudis Mine
-------------------------------------------------------------------------------
o     Discovered the 4.0 by 2.0 kilometre San Enrique gold-in-soil geochemical
      anomaly

o     Initiated acquisition of the Roca Roja property, a highly prospective area
      with a short-term potential to host at least 100,000 ounces

      <TABLE>                                                                  
      <CAPTION>
      ($in thousands except per share amounts)  1998            1997            1996
      --------------------------------------------------------------------------------
      
      <S>                                    <C>                <C>            <C>   
      Metal sales                            $  36,388          52,635         67,180
      Net income (loss)                      $ (20,848)        (40,410)         9,012
      Cash flow from operations              $     411             556         21,439
      Exploration expenditures               $   2,803           4,659          7,220
      --------------------------------------------------------------------------------
      
      Working capital                        $  45,689          49,008         65,520
      Cash and short-term deposits           $  41,493          41,735         55,302
      Total assets                           $ 102,777         123,882        165,298
      Shareholders' equity                   $  87,469         105,124        142,058
      Shares outstanding (000's)               154,686         151,445        148,588
      --------------------------------------------------------------------------------
      
      Per share - Earnings (loss)            $   (0.14)          (0.27)          0.06
                - Cash flow                  $      --              --           0.15
      --------------------------------------------------------------------------------
      
      Gold Production (ounces)
      --------------------------------------------------------------------------------
            Joe Mann                            70,100          73,500         70,400
            Santa Gertrudis                     12,300          39,200         54,400
      --------------------------------------------------------------------------------
            Total gold production               82,400         112,700        124,800
      --------------------------------------------------------------------------------
      
      Cash operating cost per ounce (US$)    $     255             288            252
      Gold revenue per ounce (US$)           $     304             336            396
      --------------------------------------------------------------------------------
      </TABLE>

                  In this report, unless otherwise indicated,
              all monetary amounts are stated in Canadian dollars.


                                                                              1
<PAGE>   4

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[LOGO] Campbell Resources Inc.
------------------------------

                   Report
      TO THE Shareholders
-------------------------

      Historically low gold prices continued to have a negative impact on the
gold mining industry and Campbell Resources in 1998. The gold price averaged
US$294 per ounce in 1998. A combination of speculative short selling and the
continued perceived threat of central bank sales have dominated the markets. The
gold price failed to respond to what would normally be considered bullish
factors including the falling US dollar, the covering of hedge fund short
positions and some renewed investor demand for gold.

      Surprisingly, these low gold prices have failed to stem world gold
production, in fact it continues to increase. The biggest supply response will
likely be in the future as reduced exploration and development budgets take
effect. Many gold producers have been living off hedge positions established in
better times and from a reduction in cash operating costs. Weak local currencies
in Australia, South Africa and Canada have also helped maintain, to some extent,
the gold price in those currencies.

      Campbell has responded to this environment by continuing to apply
financial discipline in its operations. At the Joe Mann Mine this is evidenced
by the completion of the shaft sinking project approximately $1.4 million under
budget and by the new Mine Plan which has the mine operating seven days a week
instead of the five days a week it has worked since start-up. The Santa
Gertrudis Mine ceased uneconomic mining to focus on exploration and the Cerro
Quema project was put on a care and maintenance basis awaiting higher gold
prices. This discipline has enabled the Company to maintain its strong clean
balance sheet with cash at the year end of $41.5 million.

Financial and Operating Results

      In 1998, Campbell reported a loss from operations of $10.1 million and,
after a $12.5 million writedown in the carrying value of its mining interests, a
net loss of $20.8 million, or $0.14 per share compared to a loss of $40.4
million or $0.27 per share in 1997. Cash flow from operations was $0.4 million
compared to $0.6 million in 1997.

      Gold production of 82,400 ounces in 1998 decreased from the 112,700 ounces
produced in 1997 as a result of the cessation of mining operations at Santa
Gertrudis in early December 1997.

      Cash operating costs in 1998 were US$255 per ounce of gold produced
compared with US$288 per ounce a year earlier. Campbell's realized gold revenue
of US$304 per ounce in 1998 is US$10 above the average COMEX market price for
the year of US$294 as a result of hedging activities. This compares to realized
gold revenue of US$336 per ounce in 1997.

Joe Mann Mine - Quebec, Canada

      The Joe Mann Mine in northwestern Quebec experienced a number of
significant developments during 1998. On the operating side, gold production was
70,100 ounces at a cash cost of US$257, down marginally from the 73,500 ounces
at a cash cost of US$264 per ounce, produced in 1997. The lower gold production
was primarily attributable to lower mill head grades which decreased from 0.300
ounces gold per ton in 1997 to 0.252 ounces gold per ton in 1998. Mill
recoveries have however steadily increased reaching 94.3% in 1998 compared with
93.9% a year earlier. Since 1993, recoveries have improved by 3% resulting from
circuit improvements to the mill process in 1994 and efforts by the mill
technical staff.

      The project to deepen the No. 2 mine shaft by almost 1,100 feet was
completed at a total cost of $13.1 million, approximately $1.4 million under
budget. The shaft now extends to a depth of more than 3,700 feet below the
surface.

      During the course of 1998, senior management and mine staff completed a
re-evaluation of the long-term mine plan at Joe Mann. The new long-term mine
plan calls for the immediate full development of six new levels between the 2350
level, currently the lowest level of mining, and the shaft bottom at 3,700 feet.
This development will provide access to reserves of 1.8 million tons of ore at
an average grade of 0.258 ounces gold per ton. Over the next six years, Joe Mann
is expected to produce more than 425,000 ounces of gold. The cash operating cost
is expected to average US$245 per ounce down from US$260 per ounce figure
previously forecast. Similarly, the total cash cost, which includes all
development and sustained capital expenditures, will also drop from US$285 per
ounce to US$270 per ounce. This will likely be further reduced once the new ore
zone is better defined and incorporated into the long-term mine plan.


2
<PAGE>   5

      The new ore zone is situated between the Main Zone and the North Zone,
1,000 feet east of the shaft and has, to date, been defined between the 2350 and
2575 levels. It has a strike length of 425 feet and a down-dip extension of at
least 175 feet and remains open to the east and at depth. The initial crosscut
driven to examine the zone intersected high-grade mineralization with a true
width of 39.2 feet averaging 0.293 ounces gold per ton. Historically, mine
widths at Joe Mann have been approximately 6 feet. Diamond drilling has
continued to intersect high-grade mineralization over substantial widths.
Management is confident that with this wider zone, we will be able to mine the
zone with greater productivity thus lowering the cash operating costs further.
In addition, excess hoist and mill capacities will enable us to increase annual
gold production from the Joe Mann Mine. Production from the new zone will come
on stream during the second half of 1999. Work is continuing to better define
this new discovery and to test its extensions both down-dip and along strike.

Santa Gertrudis Mine - Sonora, Mexico

      Through the continued leaching of the heaps, the Santa Gertrudis Mine
produced approximately 12,300 ounces at a cash operating cost of US$242 per
ounce in 1998. Santa Gertrudis is expected to produce a minimal amount of gold
in the first quarter of 1999 from the current leaching process.

      Since mining was initiated at Santa Gertrudis, the property has produced
approximately 300,000 ounces of gold and the potential to find additional oxide
mineralization within the 227 square kilometre property is considered to be
excellent. In the first half of 1998, exploration was focused on the Greta area
situated approximately 7 kilometres southeast of the area of past mining. The
Greta area presently has a geological resource of approximately 150,000 ounces;
however, at current gold prices, this resource would be difficult to mine
profitably. As a result Campbell's exploration team shifted its focus to other
areas.

      In May 1998, Campbell became aware that the property adjoining the mine
district was for sale. The majority of this property is underlain by the same
favourable geology which hosts the deposits previously mined by Campbell at
Santa Gertrudis. Given the promising geology and proximity to the existing
infrastructure, Campbell has been in discussions with Minera Roca Roja and
subsequently its trustee in bankruptcy. Discussions are continuing. Campbell has
prepared a program of preliminary geological work and intends to carry out a
drill program on several highly prospective targets on the Roca Roja property
that are contiguous with, or extensions of, deposits previously mined at Santa
Gertrudis as soon as an acquisition is completed.

      In addition to the extensions of previously mined deposits, structural
mapping has identified a low angle fault which extends from the mine district to
the northwest through the Roca Roja claims and back onto the Santa Gertrudis
property. Current geological interpretation indicates that the block of ground
which hosts the Santa Gertrudis deposits has moved to the southwest along this
fault. By reconstructing the displacement along this fault, it may be possible
to find the roots of the Santa Gertrudis deposits on the newly acquired ground.
Similarly, it may be possible to find the upper portions of the deposits
previously mined on the Roca Roja property. Other structural targets related to
faulting and folding are also apparent and remain to be tested.

      Our knowledge of the geology of the mine district, coupled with our nearby
existing infrastructure and the lack of any significant systematic exploration
on these claims, makes them excellent targets for the development of 100,000
ounces of reserves in the near term. Significant potential exists to develop
other reserves on the remainder of the purchased claims. Campbell's target, in
the short term, is to delineate approximately two years worth of production, or
150,000 ounces of mineable reserves, before mining can recommence.

      Soil sampling in 1998 resulted in the discovery of the 4.0 by 2.0
kilometre San Enrique gold-in-soil geochemical anomaly situated approximately
7.0 kilometres south of the mine district. Gold-in-soil values ranged up to 10.0
grams gold per tonne while limited mapping and rock sampling returned values of
up to 78.1 grams gold per tonne. The anomaly still remains open to the
southwest. A significant exploration program involving mapping, trenching and
drilling is scheduled to begin in April 1999, once surface access is secured
through the issuance of a temporary occupation order by the Mexican government.


                                                                               3
<PAGE>   6

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[LOGO] Campbell Resources Inc.
------------------------------

Personnel and Acknowledgements

      Campbell's technical and management teams have once again demonstrated
their abilities in improving the Company's performance. From the discovery of a
new ore zone at the Joe Mann Mine, the development and implementation of a new
long-term mine plan, through to the continuing improvement in recoveries at the
mill, employees at the Joe Mann Mine are to be congratulated. We also wish to
acknowledge the contribution made by Le Syndicat de Travailleurs-euses de la
Mine Meston and Les Metallurgistes Unis d'Amerique who have supported the
introduction of a seven day per week work schedule and agreed to extensions of
the collective agreements until 2001. With these changes, necessitated by
historically low gold prices, we believe Joe Mann Mine's operation is secure
through this period of expected low gold prices.

      Exploration efforts by our geologists at the Santa Gertrudis property has
been successful in delineating resources in the Greta area. Exploration is
continuing in other areas and, with the increased understanding of the geology
of the property.

      We are proud of our 300 employees, whose skills, dedication and enthusiasm
not only provide the foundation for the Company but also determine the direction
and growth of the Company in the future. We will continue to endeavour to add
value to current and future mining projects and to conduct business responsibly
in a manner designed to protect our employees and the natural environment.

Outlook and Growth Strategy

      In 1999, Campbell will continue to operate in a financially responsible
manner while developing its existing assets. We will also continue to examine
and evaluate opportunities for acquisition and/or merger.

      The discovery of a significant new ore zone at the Joe Mann Mine and the
adoption of the new long-term mine plan with its increased work schedule and
labour agreements, will result in improved productivities and lower cash
operating costs that will see the Joe Mann Mine operations continue beyond 2004.

      At the Santa Gertrudis Mine, we will focus on exploration programs to
evaluate the immediate mine area and highly prospective Roca Roja property and
the major San Enrique gold-in-soil geochemical anomaly. Management is confident
that these programs will lead to the resumption of mining operations at Santa
Gertrudis during the second half of1999.

      We are confident that a program of focused exploration, prudent capital
and exploration expenditures and the ultimate acquisition of a compatible,
high-quality asset will see Campbell grow to become an intermediate-sized,
profitable gold producer.


/s/ James C. McCartney

James C. McCartney
Chairman of the Board


/s/ John O. Kachmar

John O. Kachmar
President & Chief Executive Officer

Toronto, Ontario
March 19, 1999


4
<PAGE>   7

--------------------
Review of Operations
--------------------

      Joe Mann
          Mine

QUEBEC, CANADA

                                [PHOTO OMITTED]

                                 [MAP OMITTED]

Overview

      The Joe Mann Mine is a high-grade underground gold mine located
approximately 350 miles north of Montreal in the province of Quebec, Canada. The
mine has been in continuous production since 1987. It has produced approximately
900,000 ounces of gold and currently has geological and mineable reserves of
approximately 800,000 ounces and 500,000 ounces, respectively.

      The Joe Mann Mine is located within the Abitibi greenstone belt, which is
one of the world's most prolific gold producing regions, hosting over 250 mines.
Joe Mann is a vein-type deposit with gold-copper mineralization hosted by quartz
veins within a number of laterally continuous shear systems. To date, the
deposit has been mined along a 3,000 foot strike length, to depths of 2,350
feet. Once development of the six new levels below the 2350 level is completed,
an additional 1,300 foot vertical extent of ore will be made accessible.
Mineralization at the Joe Mann Mine remains open at depth.


                                                                               5
<PAGE>   8

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[LOGO] Campbell Resources Inc.
------------------------------

      Mining is predominantly carried out using the shrinkage stope mining
method. Ore is then processed at the Company's mill facilities, where gold is
recovered through gravity and cyanidation circuits, and a gold and copper
concentrate is produced from a flotation circuit.

Operating Results

      Cash operating costs fell 2.7% from US$264 per ounce in 1997 to US$257 per
ounce in 1998 while gold production decreased by 4.6% from 73,500 ounces in 1997
to 70,100 ounces in 1998. The decrease in production is primarily attributable
to lower mill head grades which fell from 0.300 ounces gold per ton in 1997 to
0.252 ounces gold per ton in 1998. Mill recoveries increased to 94.3% in 1998
compared to 93.9% in 1997, which are above the

<TABLE>
<CAPTION>
Production Statistics                         1998           1997           1996
================================================================================
<S>                     <C>              <C>            <C>           <C>      
Tons Milled                                299,000        266,000        266,000
Gold Grade              (oz./ton)            0.252          0.299          0.290
Copper Grade            (%)                  0.243          0.280          0.302
Gold Recovery           (%)                   94.3           93.9           93.2
Copper Recovery         (%)                   94.2           96.3           96.3
Gold Production         (oz.)               70,100         73,500         70,400
Copper Production       (000's lbs)          1,316          1,367          1,473
Cash Operating Cost
  per Ounce Gold (US$)                         257            264            272

Reserves
================================================================================
Mineable Ore Reserves (1)
--------------------------------------------------------------------------------
Proven and Probable
  - tonnage                                516,590        553,000       727,000
  - gold grade                (oz./ton)      0.229          0.238         0.268
  - copper grade              (%)            0.243          0.270         0.260
  - contained oz. gold (2)                 118,400        131,700       194,900
Possible (3)
  - tonnage                              1,462,000      1,417,000     1,546,000
  - gold grade                (oz./ton)      0.255          0.267         0.273
  - copper grade              (%)            0.250          0.260         0.259
  - contained oz. gold (2)                 372,900        378,200       422,500

Diluted Geological Reserves
--------------------------------------------------------------------------------
Proven and Probable
  - tonnage                                729,000        879,000       969,000
  - gold grade                (oz./ton)      0.210          0.225         0.249
  - copper grade              (%)            0.223          0.240         0.250
  - contained oz. gold (2)                 153,300        197,900       241,300
Possible (3)
  - tonnage                              2,520,000      2,461,000     2,647,000
  - gold grade                (oz./ton)      0.261          0.264         0.259
  - copper grade              (%)            0.240          0.250         0.240
  - contained oz. gold (2)                 657,800        649,600       685,600
</TABLE>

(1)   Mineable reserves at December 31, 1998 have been calculated based on a
      gold price of US$325 per ounce. Mineable reserves at December 31, 1997 and
      1996 were based on a gold price of US$375 per ounce.

(2)   Actual recovered ounces will depend on metallurgical recovery rates.

(3)   The possible category includes material based largely on assumed
      continuity or repetition for which there are reasonable geological
      indications but for which there are limited samples and measurements.

industry average. Since 1993, the year before improvements to the mill were
made, recoveries have increased from 91% to the current 94.3% level. The
increase in recoveries was due to continuing mill circuit modifications and the
work of the mill staff in fine-tuning the process.

      The Joe Mann Mine also produces copper and silver as a by-product.
Production of copper in 1998 was 1.3 million pounds, slightly lower than the 1.4
million pounds produced in 1997. Silver production decreased to 24,200 ounces in
1998 compared to 27,500 ounces in 1997.

Long-Term Mine Plan

      Following the successful completion of the shaft deepening program in July
1998 at a cost of $13.1 million, approximately $1.4 million less than budgeted,
Campbell considered various alternatives for the further development of the
mine. The long-term plan that was finally adopted calls for the immediate full
development of all six levels between the 2350 level, which is currently being
mined, and the shaft bottom at 3,700 feet. The plan is expected to have
significant economic benefits for the Company including reduced cash operating
costs.

                               [GRAPHIC OMITTED]

  [The following table was depicted as a bar graph in the printed material.]

<TABLE>
<CAPTION>
                                    95           96           97           98
<S>                                <C>          <C>          <C>          <C>  
Gold Production                     64.5         70.4         73.5         70.1
(thousands of ounces)

Cash Operating Cost                284          272          264          257
(US$ per ounce)

Gold Reserves                      916.7        926.9        847.5        811.1
(thousands of ounces)
</TABLE>


6
<PAGE>   9

--------------------
Review of Operations
--------------------

3-D Model of the Joe Mann Mine

                                 [MAP OMITTED]

      The plan envisages mining approximately 1.8 million tons of ore at an
average grade of 0.258 ounces gold per ton to produce more than 425,000 ounces
of gold over the next 6 years. The average cash operating cost is forecast to
decrease to US$245 per ounce, compared to a cash operating cost of US$260 as
previously forecast. The total cash cost, including all development and
sustained capital expenditures, will also decrease to US$270 per ounce from
US$285 per ounce. Additional increases in gold production and lower cash
operating costs are expected once the impact of the new ore zone, discussed in
detail below, is taken into account.

      In addition to ore from the Main and South Zones, which are situated east
of the production shaft, the plan includes initial production from the West Zone
between the 1650 and 1825 levels of the mine. Further exploration and
development in the West Zone is contemplated above the 2350 level with an
expected increase in reserves. Results from three raises completed between the
1650 and 1300 levels indicate the continuous presence of additional ore above
the 1650 level.

      A key component of the plan includes the adoption of a 7 day per week
mining schedule as compared to the current 5 day per week schedule and the
elimination of the 2 week summer shut-down. The net effect will be to increase
the number of days of mining from 237 days per year to 347 days per year. Due to
the excess mill capacity, the mill will operate an average of 260 days per year.

      The unions, representing the hourly mine and mill workers, support the
implementation of the new work schedule and management has been successful in
arranging extensions to the current labour agreements to December 2001.

Exploration Results from the 2575 Level

      Early exploration on the 2575 level, initiated in the fall of 1998,
encountered impressive results approximately 1,000 feet east of the shaft. A
crosscut driven at 1100E to investigate results from three earlier holes drilled
from the 2350 level intersected a zone of high-grade mineralization with a true
width of 39.2 feet averaging 0.293 ounces gold per ton. Historically, mine
widths at Joe Mann have been approximately 6.0 feet. This new ore zone is
situated approximately 200 feet north of the Main Zone and approximately 40 feet
south of the North Zone. Drilling to test a 475 foot section of the zone between
975E and 1450E and the 2350 and 2575 levels is ongoing.

      At present, it is thought that the mineralization of the new ore zone is
spatially and genetically related to a large quartz-feldspar porphyry dyke.
There are two limbs of high-grade ore mineralization which occur at the northern
and southern contacts between the porphyry dyke and a sheared gabbro.


                                                                               7
<PAGE>   10

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[LOGO] Campbell Resources Inc.
------------------------------

                                [PHOTO OMITTED]

      Mineralization within the new ore zone is similar to ore found in the Main
Zone and contains up to 15% sulphides within quartz veins. In addition, there
are numerous occurrences of visible gold. Development of the 2575 level is
continuing to determine the eastern extent of mineralization of the new ore
zone. In addition, crosscuts are also being driven on the 1100E and 1300E
sections of the 2575 level to enable drilling to test the new zone below the
2575 level.

      While the extent and grade of the new ore zone are not fully known, early
estimations indicate the zone contains a mineable reserve between the 2350 and
2575 levels of approximately 140,000 tons averaging 0.312 ounces gold per ton.
Mine management expects to mine some of this reserve beginning in the second
half of 1999 using cut and fill methods. It is estimated that the new zone will
contribute approximately 8,000 ounces to this year's gold production, increasing
thereafter.

      Lateral development is being carried out on the 2750, 2925 and 3100 levels
and it is expected that within two months the 2750 level will have advanced to
the projected depth of the new ore zone enabling further definition drilling of
the zone.

      As a result of the discovery of the new ore zone, forecast gold production
has been increased to 78,000 ounces in 1999, up from the previous projection of
70,000 ounces. Total cash operating costs are estimated to be US$250 per ounce.


8
<PAGE>   11

--------------------
Review of Operations
--------------------

Santa Gertrudis
           Mine

 SONORA, MEXICO

                                [PHOTO OMITTED]

                                 [MAP OMITTED]

Overview

      The Santa Gertrudis Mine is an open pit heap leach operation situated
approximately 240 kilometres south of Tucson, Arizona in the state of Sonora,
Mexico. The Santa Gertrudis Mine was in continuous production from 1991 until
1997 and produced approximately 300,000 ounces of gold during this time period.
Since Campbell's acquisition of the property in mid-1994, it has produced more
than 177,000 ounces at an average cash operating cost of US$249 per ounce.

      Ore deposits mined at Santa Gertrudis have strong geological similarities
to the prolific gold mines found within the Carlin Trend in Nevada. The Santa
Gertrudis orebodies are preferentially hosted by silty carbonate rocks, but have
a strong element of structural control. The gold mineralization is finely
disseminated with ore grades typically averaging 2.0 grams of gold per tonne
(g/t gold). The ore is completely oxidized and amenable to the low-cost heap
leach gold extraction method.


                                                                               9
<PAGE>   12

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

Operating Results

      In 1998, Santa Gertrudis produced 12,300 ounces of gold at a cash cost of
US$242 per ounce compared to the production of 39,200 ounces at a cash operating
cost of US$333 per ounce in 1997. Gold production in 1998 was the result of
continued application of solutions to the heaps on the leach pads. This process
was completed in December 1998.

<TABLE>
<CAPTION>
Production Statistics                                     1998           1997
================================================================================
<S>                      <C>                           <C>            <C>
Tonnes mined (ore+waste)                                      --      7,432,000
Tonnes ore mined                                              --      1,021,000
Strip Ratio                                                   --           6.28
Gold Grade               (grams/metric tonne)                 --           1.71
                         (oz./ton)                            --           0.05
Gold Recovery            (%)                                  --           69.5
Gold Production          (oz.)                            12,300         39,200
Cash Operating Cost
  per Ounce Gold (US$)                                       242            333

Mineral Resources
================================================================================
Possible (1)
--------------------------------------------------------------------------------
  - tonnage              (metric tonnes)               1,992,000      2,422,000
  - gold grade           (grams/metric tonne)               2.08           2.00
                         (oz./ton)                         0.059          0.058
  - indicated gold       (oz.)                           133,000        155,700
</TABLE>

(1)   Diluted geological resources - The possible category includes material
      based largely on assumed continuity or repetition for which there are
      reasonable geological indications but for which there are limited samples
      and measurements.

Exploration

      In 1998, the Company continued to conduct exploration involving mapping,
rock and soil geochemical sampling, trenching and drilling in an effort to
define resources and reserves outside the area of past mining activity. This
effort led to the delineation of a geological resource contained in five
deposits within the Greta area, approximately 7 kilometres southeast of the mine
district. Because the Greta area is situated some distance from the mine
infrastructure and with gold prices at historic lows, this resource of 1.8
million tonnes averaging 2.4 g/t gold, or 150,000 ounces, is presently
uneconomic. Should the gold price improve, exploration will resume in the area
to establish mineable reserves.

      Ongoing regional exploration led to the discovery of the San Enrique
anomaly, a large soil geochemical anomaly with great potential situated
approximately 7 kilometres south of the mine district.

      In May 1998, Campbell commenced discussions to acquire the former gold
producing Roca Roja property. Discussions are continuing with the trustee in
bankruptcy of Minera Roca Roja. The Roca Roja property has the potential to host
reserves which could be

Location Map

                                 [MAP OMITTED]

developed in the near term given its proximity to the existing mine
infrastructure. Campbell is confident that exploration completed in the
short-term will delineate mineable reserves that will sustain mining operations
for at least two years.

      In 1998, $2.3 million was spent on exploration at Santa Gertrudis. The
initial phase of exploration for 1999, covering the first 3 to 4 months, has
been budgeted at $750,000. Additional funds will become available as results
warrant. Efforts will focus on the Roca Roja property and the adjacent mine
district, and the San Enrique soil geochemical anomaly.

The Roca Roja Property and the Mine District

      Following the decision to re-focus exploration outside of the Greta area,
Campbell began assessing the possibility of acquiring certain claims north, east
and west of the Santa Gertrudis property. As a result of this assessment,
Campbell initiated discussions with Minera Roca Roja, a former gold producer, to
purchase its mineral claims totalling approximately 900 hectares. Preliminary
investigations suggest the potential to find 100,000 ounces of reserves in the
short-term on the Roca Roja property is excellent.

      The majority of the Roca Roja property is underlain by the same
stratigraphy as that which hosts the deposits of the mine district. Many of the
previously mined deposits extend north to the Santa Gertrudis property border
and appear to extend into the claim


10
<PAGE>   13

--------------------
Review of Operations
--------------------

Geology of Santa Gertrudis Mine District and Roca Roja Property

                                 [MAP OMITTED]

area. Recent geological investigations support this idea as it is apparent that
the Lola-La Peque structure, a large shear zone discovered earlier, extends
beyond the Santa Gertrudis property onto the Roca Roja property. This shear
zone, now referred to as the La Peque-Escondida structure, has currently been
identified over a strike length of 4 kilometres, of which the eastern 1.5
kilometres is called the Escondida target. Where it is exposed, the shear zone
varies from 9.0 to 11.4 metres in width and one trench has returned a value of
1.7 g/t gold over 10.5 metres. Re-evaluation of the La Peque and Lola targets in
conjunction with additional trenching and preliminary drilling at Escondida will
be completed to examine the potential of this significant structure.

      Approximately 1 kilometre south of Escondida, limited mapping on the Roca
Roja property has identified a southwest striking, southeast dipping structure,
the Veronica shear, that bears similarities to the La Peque-Escondida structure.

      The Veronica shear, which hosts the Veronica target, has a strike length
of at least 1 kilometre which represents the displaced extensions of the El
Carmen-Mirador-Melissa Northwest zones. These zones are spatially associated
with the Veronica shear, which represents a feeder structure. The Veronica
target has been tested with two preliminary trenches spaced 60 metres apart. The
first trench uncovered an altered limestone and siltstone package and returned a
value of 1.86 g/t gold over 3.2 metres. A second trench, 60 metres southeast of
the first, returned values of 1.09 g/t gold over 3.1 metres, and 1.54 g/t gold
over 1.3 metres.

      A second structure parallel to bedding, the Veronica Northwest target, is
situated approximately 750 metres northwest of the Veronica shear and is a
high-priority exploration target. Grab samples from this target returned values
ranging up to 5.29 g/t gold and follow-up channel sampling returned a value of
2.11 g/t gold over 2.3 metres.


                                                                              11
<PAGE>   14

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

      Approximately halfway between the La Peque-Escondida structure and the
past producing pits of the mine district is the southeast trending Real Viejo
shear. The shear consists of two sub-parallel, steeply dipping faults 35 metres
apart which cut siltstones, sandstones and conglomerates. The faults are
characterized by 10 metre wide zones of strong silica-hematite alteration with
abundant quartz veining. Grab samples from the faults have assayed up to 2.046
g/t gold. Trenching is expected to begin shortly.

      During 1998 the potential acquisition of the Roca Roja ground resulted in
a resurgence of exploration in and around former targets with remaining
resources in the mine district.

      The Melissa Northwest target is one area of particular interest. It is an
extension of the Hilario, a previously mined deposit. The Melissa Northwest
target extends to Santa Gertrudis' property boundary and is likely to extend
beyond into the newly acquired claims. Recent drilling from Melissa Northwest
returned assays of 1.655 g/t gold over 6.0 metres including 2.099 g/t gold over
4.5 metres and a second interval which averaged 1.605 g/t gold over 22.5 metres.
There is strong geological evidence that the structure which hosts Melissa
Northwest could extend beyond the property boundary and be related to the El
Carmen and Mirador targets on the Roca Roja property.

      In addition to the faults, shear zones and targets discussed above,
recently completed structural mapping has identified a low angle normal fault,
known as the El Carmen fault, which runs through the Santa Gertrudis property
and the newly acquired claims. It is thought by reconstructing the displacement
along the fault, it may be possible to find the roots of the Santa Gertrudis
deposits on the Roca Roja property. Similarly, it may be possible to find the
upper portions of the deposits previously mined on the Roca Roja property. Other
structural targets on the Roca Roja property related to faulting and folding are
also apparent and remain to be tested.

San Enrique Soil Geochemical Anomaly

      In 1998, as part of an ongoing regional soil geochemical survey, a
gold-in-soil geochemical anomaly was defined south of the mine district.
Presently, the anomaly has a north-south strike length of 4.0 kilometres, is
approximately 2.0 kilometres wide and remains open to the southwest.

      Within the San Enrique anomaly, four strongly anomalous zones are present.
The core of the anomaly is a zone 750 metres in length with soil sample values
ranging from 0.1 to 2.49 g/t gold. A second zone lies 1 kilometre
north-northwest of the core of the anomaly and coincides with an area of
quartz-pyrite veined felsic dykes. Rock samples returned values of up to 6.026
g/t gold over 0.8 metres. The third strongly anomalous zone is 150 metres
north-northwest of the core of the anomaly and has soil sample values of up to
2.1 g/t gold. The fourth zone is situated approximately 2 kilometres south of
the core of the anomaly with soil values greater than 10.0 g/t gold. Rock grab
samples from the San Enrique anomaly have assayed up to 78.1 g/t gold.

San Enrique
Soil Geochemical
Anomaly

                                 [MAP OMITTED]


12
<PAGE>   15

--------------------
Review of Operations
--------------------

      Airborne geophysical interpretation of the area suggests the main core of
the anomaly occurs within a northwest oriented zone of low magnetic intensity.
The southern portion of the anomaly is situated over a relatively weak magnetic
high, which reflects intrusive activity. The anomaly is cut by three northeast
trending magnetic breaks, interpreted to be faults, and two northwest striking
zones of weak electromagnetic conductivity. The combination of these geophysical
features suggests the presence of several structural intersections. A strong
potassium anomaly is coincident with the soil geochemical anomaly.

      The core of the anomaly is underlain by a 45 metre thick unit of
decalcified and silicified siltstone and limestone with abundant quartz-pyrite
veins. The eastern boundary of the geochemical anomaly coincides with a north
trending faulted contact between the limestone and siltstone unit and the
surrounding rocks. This further supports the correlation between the siltstone
and limestone unit and the anomaly. Underlying this siltstone and limestone unit
is a shallow dipping diorite sill that has potential to act as a trap for
gold-bearing fluids.

      Following these initial investigations, exploration on the anomaly was
delayed because of difficulties in concluding an agreement with the surface
rights owner. As a result, Campbell filed an application for temporary
occupation with the Government of Mexico. Campbell has been advised that the
temporary occupation resolution was granted on March 17, 1999. A program of
mapping, sampling trenching and drilling in order to fully evaluate the San
Enrique anomaly will commence in early April 1999.

      Excellent exploration potential exists at the Santa Gertrudis property and
efforts will be directed to explore the San Enrique geochemical anomaly south of
the mine district. Immediately following acquisition, exploration efforts will
commence on the Roca Roja property north of the mine district. The Company
intends to recommence mining operations once two years' worth of mineable
reserves have been established.

--------------------------------------------------------------------------------

Cerro Quema Project
Los Santos, Panama

      The feasibility study previously completed by Campbell indicates that
Cerro Quema has mineable reserves, based on a gold price of US$400 per ounce, of
8,772,000 tonnes averaging 1.16 g/t gold and projected cash operating costs of
approximately US$180 per ounce. Capital costs associated with the project are in
the order of US$100 to US$110 per ounce. Gold prices have remained in the US$270
to US$315 per ounce range for the last year and appear unlikely to materially
increase during 1999. Campbell has therefore continued to keep the project on a
care and maintenance basis pending an improvement in the price of gold. Should
gold prices improve significantly, construction at Cerro Quema will recommence
and once finished, the project will produce approximately 50,000 ounces of gold
annually. The Company believes there is excellent exploration potential beyond
the existing reserves on the property.

Growth Strategy

      During the course of the year, senior management and operations personnel
with assistance from industry consultants, continued to review opportunities
with respect to mergers and acquisitions. While extensive due diligence was
carried out on at least three operations located in the Americas and elsewhere,
no transaction has been concluded due to various factors. These include poor
results from the due diligence, assets burdened by excessive debt levels and an
inability to reach a consensus on value. Management will continue this
disciplined approach to evaluating opportunities in order to complete a
transaction which is accretive to its shareholders.


                                                                              13
<PAGE>   16

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

                      Management's Discussion and Analysis
                                     15 - 18

              Management's Responsibility for Financial Reporting
                                Auditors' Report
                                       19

                          Consolidated Balance Sheets
                                       20

                     Consolidated Statements of Operations
             Consolidated Statements of Retained Earnings (Deficit)
                                       21

                     Consolidated Statements of Cash Flows
                                       22

                 Notes to the Consolidated Financial Statements
                                    23 - 30

                         Five Year Comparative Summary
                       Selected Quarterly Financial Data
                                       31

                            Shareholder Information
                                       32

                             Corporate Information

                               Inside Back Cover


14
<PAGE>   17

----------------
Financial Review
----------------

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
--------------------------------------------------------------------------------

SIGNIFICANT DEVELOPMENTS
DURING 1998

Maintained a Strong Balance Sheet

      Campbell Resources and the gold industry as a whole have continued to
experience historically low gold prices over the last year. During 1998,
Campbell continued to operate in a cash preservation mode by reducing operating,
overhead and capital costs wherever possible. As a result its treasury of $41.5
million at year end remains unchanged from the previous year. This financial
strength will allow the Company to move forward in the current low gold price
environment by selectively developing its existing assets and searching for gold
property investment opportunities and possible merger candidates.

Joe Mann Mine Development

      The production shaft deepening project at the Joe Mann Mine was completed
during 1998 at a cost of $13.1 million compared to the original budget of $14.5
million. As a result of studies performed during the fall of 1998, a new mine
plan was approved in early 1999 which will result in the full development of all
six new levels accessible from the deepened shaft. The mine will begin operating
7 days per week compared to the current 5 days with no summer shutdown. As a
result the average long-term cash operating cost at the mine is expected to
decrease by approximately US$15 to US$245 per ounce of gold. This new plan is
supported by the unions representing the hourly workers who have agreed to
extend their labour contracts by a further two years.

Santa Gertrudis Exploration

      The future of the Santa Gertrudis Mine is dependant on the success of the
current exploration efforts at the site. As a result of work performed during
1998, the focus of the exploration effort will now be concentrated on two main
targets, the significant geochemical soil anomaly measuring 4 kilometres by 2
kilometres discovered on its claims on the south western portion of the
property, and the claims of the neighbouring former gold producer, Minera Roca
Roja, which is in bankruptcy proceedings. The previously announced purchase of
the Roca Roja claims was approved by the bankruptcy judge on February 23, 1999,
with the final purchase price to be determined by appraisal. The Company is in
the process of gaining access to the land containing the geochemical anomaly to
commence drilling.

      Campbell has been advised that a Temporary Occupation Resolution was
granted by the Mexican government on March 17, 1999. This Resolution was sought
as a consequence of being unable to come to a satisfactory financial arrangement
with the surface rights holder. Based on recent encouraging progress it is
expected that access to both targets will be possible late in the first quarter
of 1999.

Average Market Gold Price of US$294

      The gold price continued to disappoint gold producers and investors alike
during 1998, averaging US$294 per ounce. The falling US dollar, the covering of
some hedge fund short positions and renewed investment demand for gold have all
failed to significantly rally the price. The continued perceived threat of
central bank sales will likely continue to act as a cap on prices although many
are forecasting a slight recovery during 1999. Campbell has incorporated these
lower prices into its normal review of the carrying value of its mining
interests. The Company compared the future estimated net revenues to be
generated from its properties to their carrying amounts assuming gold prices of
US$300 per ounce of gold for 1999, US$315 for 2000 and US$325, thereafter. As a
result of this analysis the Company wrote down the carrying value of its Cerro
Quema project in Panama by $10.2 million. During 1997 the Company wrote down the
carrying amount for the Joe Mann Mine by $28 million. Also during 1998, the
Company incurred a loss on the sale of surplus mining equipment of $2 million,
wrote down obsolete supplies inventory at its Santa Gertrudis mine by $0.5
million and sold its interest in the Wildcat property in Nevada recognizing a
gain of $0.2 million.

FINANCIAL RESULTS

      For the year ended December 31, 1998, the Company recorded a loss of $20.8
million, or $0.14 per share, compared to a loss of $40.4 million ($0.27 per
share) in 1997 and income of $9 million ($0.06 per share) in 1996. Excluding the
writedown and loss on sale of mining interests of $12.5 million (1997 - $31.7
million; 1996 - $nil), there was a loss from operations of $10.1 million in 1998
compared to a loss from operations of $12.2 million in 1997 and income from
operations of $6.7 million in 1996. The cessation of uneconomic mining
operations in Mexico in December, 1997 contributed to the 1998 results. The loss
from operations in 1997 compared to income in 1996 is principally due to lower
gold prices, a decrease in gold production and higher mining costs and
exploration expense at the Santa Gertrudis Mine.


                                                                              15
<PAGE>   18

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

REVENUE

<TABLE>
<CAPTION>
Gold produced (ounces):                     1998            1997            1996
<S>                                       <C>            <C>             <C>    
  Joe Mann Mine                           70,100          73,500          70,400
  Santa Gertrudis Mine                    12,300          39,200          54,400
--------------------------------------------------------------------------------
                                          82,400         112,700         124,800
--------------------------------------------------------------------------------
Gold revenue per ounce                    US$304          US$336          US$396
Average market price                      US$294          US$331          US$388
</TABLE>

      Revenue from metal sales decreased in 1998 by 31% to $36.4 million
compared to $52.6 million in 1997 and $67.2 million in 1996. The decrease in
1998 was attributable to a 10% reduction in the gold price realized during the
year and a 27% decrease in gold production to 82,400 ounces compared to 112,700
ounces in 1997. This was offset to an extent by the weakening of the Canadian
dollar by approximately 7%. The decrease in 1997 revenues relative to 1996 was
largely due to lower gold prices and lower gold production attributable to lower
grade material mined at the Santa Gertrudis Mine and the cessation of mining
operations in early December, 1997.

      The average gold price realized compared to the average market price is
disclosed in the table above. The difference between the price realized and the
market price is primarily attributable to the Company's limited hedging
activities. Campbell's general policy is to hedge a maximum of 50% of its gold
production for up to two years, dependent on market conditions and planned
capital expenditure commitments. The Company is currently considering
longer-term hedging strategies for its Joe Mann Mine following the recently
announced decision to fully develop all six levels below the 2350 level.

      With respect to gold price hedging, the Company may either sell gold
forward in U.S. dollars or in Canadian dollars. With respect to the Joe Mann
Mine in Canada, the Company may also enter into a U.S. / Canadian dollar forward
sale agreement to fix the sale proceeds on anticipated gold sales in Canadian
dollars and therefore fund the operating and capital expenses of the Canadian
operation. As disclosed in the notes to the financial statements, under Canadian
GAAP the Company recognizes the gain or loss on these financial instruments in
sales revenue when the related production is delivered as they are considered
hedges of future production revenue. Under U.S. GAAP foreign exchange forward
contracts would be marked to market at the balance sheet date and any gains or
losses included in income at that time (see note 12 to Consolidated Financial
Statements).

      Revenues from copper production at the Joe Mann Mine accounted for 4.8% of
total revenue in 1998 compared to 3.6% in 1997 and 3.1% in 1996. The increase is
due to the reduction in total revenues as a result of the decrease in gold
production from Santa Gertrudis. Copper production decreased to 1.3 million
pounds compared to 1.4 million pounds in 1997 and 1.5 million pounds in 1996 as
a result of lower copper grades.

EXPENSES

<TABLE>
<CAPTION>
Cash Cost per Ounce                           1998           1997           1996
<S>                                         <C>            <C>            <C> 
Joe Mann Mine                               US$257         US$264         US$272
Santa Gertrudis Mine                        US$242         US$333         US$227
--------------------------------------------------------------------------------
Overall                                     US$255         US$288         US$252
</TABLE>

      Mining expense decreased to $33.4 million in 1998 compared to $46.7
million in 1997 and $44.7 million in 1996 as a result of the cessation of mining
operations at the Santa Gertrudis Mine in December, 1997. The increase in 1997
compared to 1996 was primarily due to mining ore at Santa Gertrudis with higher
waste to ore ratios compared to 1996.

Joe Mann Mine

      Production from the Joe Mann Mine decreased by 4.6% to 70,100 ounces of
gold in 1998 compared to 73,500 ounces in 1997 and 70,400 ounces in 1996. The
decrease is primarily attributable to lower mill head grades of 0.252 ounces of
gold per ton in 1998 compared to 0.30 in 1997 and 0.29 in 1996. Mill recoveries
increased to 94.3% in 1998 compared to 93.9% in 1997 and 93.2% in 1996. As noted
in the third quarter, mill recoveries have been steadily increasing over the
last few years from approximately 91% in 1993 to the current levels of 94.3%.
This has been achieved as a result of the mill improvements in 1994 and the work
of the mill staff in fine tuning the process. The tons of ore milled increased
to 299,000 tons in 1998 compared to 266,000 tons in 1997 and 1996.

      The decrease in cash costs per ounce of gold produced in 1998 is largely a
result of the weaker Canadian dollar and for 1997 is primarily attributable to
higher gold production. For 1999 the Joe Mann Mine is expected to produce
approximately 78,000 ounces of gold at a cash cost of US$250 per ounce which
assumes that mining commences from the new ore zone on the 2500 level late in
the second quarter.


16
<PAGE>   19

----------------
Financial Review
----------------

Santa Gertrudis Mine

      During 1998, the Santa Gertrudis Mine produced 12,300 ounces of gold as a
result of the continued application of cyanide solutions to the heaps on the
leach pads. This process was completed in December, 1998. The cash cost per
ounce of US$242 per ounce of gold produced in 1998 is higher than it would
otherwise be as it includes all overhead costs associated with keeping the mine
infrastructure in place while the exploration effort is ongoing.

      The 1997 cash production cost per ounce of gold, excluding the severance
and related closure costs, increased by 47% compared to 1996 as a result of the
lower gold production and the fixed nature of a portion of the mine's costs.

Depreciation and Amortization

      Depreciation and amortization expense was $6.2 million in 1998 and $9.6
million in 1997 and 1996. The amortization on a per ounce produced basis was $75
per ounce in 1998 compared to $85 in 1997 and $78 in 1996. The decrease in
amortization per ounce in 1998 is primarily due to the impact of the writedown
of the Joe Mann Mine in 1997. The increase in amortization per ounce in 1997 is
due to a higher proportion of gold production being generated from the Joe Mann
Mine which then had a higher depreciable base than the Santa Gertrudis Mine.

Exploration

      Total exploration expenditures for 1998 were $2.8 million compared to $4.7
million in 1997 and $7.2 million in 1996. Of this amount, $0.5 million (1997 -
$0.6 million; 1996 - $1.7 million) relates to the Joe Mann Mine and $2.3 million
(1997 - $3.7 million; 1996 - $4.9 million) relates to the Santa Gertrudis Mine.
The Santa Gertrudis expenditures for 1998 were expensed. The Santa Gertrudis
expenditures for 1997 and 1996 and the Joe Mann expenditures for all three years
have been capitalized to mining interests in accordance with the Company's
accounting policies. In addition to the 1998 Santa Gertrudis exploration
expenditures the expense for 1998 includes $2 million (1997 - $5 million; 1996 -
$2.6 million) representing the write-off (1997 and 1996 write-off and
amortization) of exploration costs at the Santa Gertrudis Mine that had been
previously capitalized. The write-off is with respect to individual exploration
target costs where economic mineralization was not identified and the
amortization is with respect to production from the mine during the respective
year.

OTHER INCOME (EXPENSE)

      Other income was $2.4 million in 1998 compared to $2.1 million in 1997 and
$3.6 million in 1996. The major component, interest income on short-term
deposits, increased to $2 million from $1.8 million in 1997 and $3.2 million in
1996. The increase during 1998 was due to higher short-term interest rates. The
decrease in 1997 was due to lower interest bearing balances as a result of the
capital expenditure programs at the Cerro Quema project and Joe Mann Mine.

      Interest expense on the Company's convertible debentures was $0.5 million
in 1998 compared to $0.6 million in 1997 and $0.7 million in 1996. The decrease
is attributable to the continuing conversion of a portion of the debentures to
common shares (see note 5 to Consolidated Financial Statements).

INCOME TAXES

      The Company recorded income tax expense of $0.1 million in 1998 compared
to a recovery of $2 million in 1997 and an expense of $0.6 million in 1996.
Reference should be made to note 7 to the Consolidated Financial Statements for
additional information on the reported tax provisions.

LIQUIDITY AND CAPITAL RESOURCES

      At December 31, 1998, the Company's working capital decreased to $45.7
million compared to $49 million in 1997 and includes cash and short-term
deposits of $41.5 million in 1998 and $41.7 million in 1997. Cash flow from
operations before the net change in non-cash operating working capital decreased
to $0.4 million in 1998 compared to $0.6 million in 1997 and $21.4 million in
1996. Based on a US$300 per ounce average gold price for 1999 and the production
estimates noted above, the Company believes it will achieve a modest positive
operating cash flow in 1999.

      The main source of cash for the Company during 1998 was from the sale of
surplus mining equipment and the Wildcat property in Nevada which yielded $3.7
million, and the reduction in operating working capital. The main source of cash
during 1997 was the early termination of various gold hedging instruments
totalling 118,100 ounces which resulted in cash proceeds of $9,679,000. Sources
of cash in 1996, other than from operations, was the issuance of 18 million
common share and purchase warrant units for net proceeds of $28.6 million.


                                                                              17
<PAGE>   20

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

Capital Expenditures

Capital expenditures were as follows ($000's):

<TABLE>
<CAPTION>
                                            1998            1997            1996
<S>                                      <C>             <C>             <C>    
Joe Mann Mine
  - sustaining                           $ 2,017         $ 2,360         $ 3,951
  - shaft deepening                        4,452           6,564           1,598
--------------------------------------------------------------------------------
                                           6,469           8,924           5,549
Santa Gertrudis Mine                          82           3,091           4,870
Cerro Quema Project                        1,580          17,200           3,411
Other                                         10              68             138
--------------------------------------------------------------------------------
                                         $ 8,141         $29,283         $13,968
--------------------------------------------------------------------------------
</TABLE>

YEAR 2000

      The Company has substantially completed the process of cataloguing all
computer hardware and software as well as all other applications and processes
which may be date sensitive, as it relates to the Company's corporate office and
the Joe Mann Mine. Supplies and services provided by external suppliers are also
being reviewed to obtain assurance they will not be interrupted as a result of
Year 2000 issues. The Company has engaged external consultants to assist in
identifying which individual personal computers need to be replaced or upgraded
and which software packages need to be upgraded to ensure they are Year 2000
compliant. This process has largely been completed other than for the Mexican
operations which will be evaluated as part of the feasibility for any future
production decision. New equipment and software will be installed during the
second quarter. To date the Company is not aware of any significant
modifications required to the non-computer applications at the Joe Mann Mine.
The cost to make the Company's operations Year 2000 compliant is not expected to
be material.

OUTLOOK

      For 1999, in addition to continuing to exercise financial discipline,
Campbell will focus its efforts in three areas. First, implementing the new mine
plan at the Joe Mann Mine which will now be expanded to include delineating the
new ore zone. The new zone is known to contain over three hundred thousand tons
of possible ore on the 2500 level and is still open at depth. Given its
proximity to the shaft and the width of the new ore zone this could result in a
significant increase in annual production at a reduced cash cost. Once the zone
is better delineated the long-range mine plan will be updated.

      Second, at Santa Gertrudis the focus will be on completing the process of
gaining access to the promising exploration targets in the two main areas of
interest described earlier and initiating the drill program thereon. Campbell
has budgeted US$500,000 for an initial work phase that will last for three to
four months. Thereafter the results will be reviewed and a budget developed for
the balance of the year.

      Third, Campbell will continue its search for acquisition or merger
opportunities which are in the best interests of its shareholders. Significant
management and consultant effort was expended again during 1998 conducting site
due diligence on a number of properties. However, due to various factors ranging
from poor results of the due diligence to the price none of these has resulted
in a transaction.


18
<PAGE>   21

Financial Review

MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING
--------------------------------------------------------------------------------

      The accompanying consolidated financial statements of the Company were
prepared by management in accordance with accounting principles generally
accepted in Canada, consistently applied and within the framework of the summary
of significant accounting policies in these consolidated financial statements.
Management is responsible for all information in the annual report. All
financial and operating data in the annual report is consistent, where
appropriate, with that contained in the consolidated financial statements.

      A system of internal accounting control is maintained in order to provide
reasonable assurance that assets are safeguarded and that transactions are
properly recorded and executed in accordance with management's authorization.
This system includes established policies and procedures, the selection and
training of qualified personnel and an organization providing for appropriate
delegation of authority and segregation of responsibilities.

      The Board of Directors discharges its responsibilities for the
consolidated financial statements primarily through the activities of its Audit
Committee composed of three directors, none of whom are members of management.
This Committee meets with management to assure that it is performing its
responsibility to maintain financial controls and systems and to approve the
annual consolidated financial statements of the Company. The Audit Committee
also meets with the independent auditors to discuss the results of their audit
and their audit report prior to submitting the consolidated financial statements
to the Board of Directors for approval.

      The consolidated financial statements have been audited on behalf of the
shareholders by the Company's independent auditors, KPMG LLP, in accordance with
generally accepted auditing standards. The auditors' report outlines the scope
of their examination and their opinion on the consolidated financial statements.


/s/ John O. Kachmar

John O. Kachmar
President and Chief Executive Officer


/s/ Paul J. Ireland

Paul J. Ireland
Vice President, Finance and Chief Financial Officer

AUDITORS' REPORT TO THE SHAREHOLDERS
--------------------------------------------------------------------------------

      We have audited the consolidated balance sheets of Campbell Resources Inc.
as at December 31, 1998 and 1997 and the consolidated statements of operations,
retained earnings (deficit) and cash flows for each of the years in the
three-year period ended December 31, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

      We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform an audit to obtain
reasonable assurance whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosure in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.

      In our opinion, these consolidated financial statements present fairly, in
all material respects, the financial position of the Company as at December 31,
1998 and 1997 and the results of its operations and the cash flows for each of
the years in the three-year period ended December 31, 1998 in accordance with
generally accepted accounting principles.


/s/ KPMG LLP

Chartered Accountants

Toronto, Canada
February 18, 1999


                                                                              19
<PAGE>   22

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------
as at December 31, (Expressed in thousands of Canadian dollars)

<TABLE>
<CAPTION>
                                                           1998            1997
<S>                                                   <C>             <C>      
ASSETS
Current assets
Cash and short-term deposits                          $  41,493       $  41,735
Receivables                                               2,653           4,805
Inventories (note 2)                                      4,538           7,250
Prepaids                                                    474             995
--------------------------------------------------------------------------------
  Total current assets                                   49,158          54,785
--------------------------------------------------------------------------------
Other assets (note 3)                                       502             986
Mining Interests (note 4)                                53,117          68,111
--------------------------------------------------------------------------------
  Total assets                                        $ 102,777       $ 123,882
================================================================================

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable                                      $   2,254       $   3,989
Accrued liabilities                                       1,215           1,788
--------------------------------------------------------------------------------
  Total current liabilities                               3,469           5,777
--------------------------------------------------------------------------------

Reclamation and other liabilities                         2,571           1,442
Convertible debentures (note 5)                           5,652           7,341
Deferred mining taxes                                     3,616           4,198
Shareholders' equity
Capital stock (note 6)                                  123,632         121,425
Foreign currency translation adjustment                   1,394             408
Deficit                                                 (37,557)        (16,709)
--------------------------------------------------------------------------------
  Total shareholders' equity                             87,469         105,124
--------------------------------------------------------------------------------
  Total liabilities and shareholders' equity          $ 102,777       $ 123,882
================================================================================
</TABLE>

Commitments and contingencies (note 8)

Approved by the Board


                  /s/ James D. Beatty

                  Director


                  /s/ John O. Kachmar

                  Director

        See accompanying notes to the consolidated financial statements.


20
<PAGE>   23

----------------
Financial Review
----------------

CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
for the years ended December 31,
(Expressed in thousands of Canadian dollars except per share amounts)

<TABLE>
<CAPTION>
                                                                 1998           1997           1996
<S>                                                          <C>            <C>            <C>     
Metal sales                                                  $ 36,388       $ 52,635       $ 67,180
---------------------------------------------------------------------------------------------------
Expenses
  Mining                                                       33,449         46,681         44,667
  General administration                                        2,648          3,203          3,064
  Depreciation and amortization                                 6,211          9,587          9,604
  Exploration                                                   4,199          5,315          3,179
---------------------------------------------------------------------------------------------------
                                                               46,507         64,786         60,514
---------------------------------------------------------------------------------------------------
Income (loss) from operations before writedown
  and loss on sale of mining interests                        (10,119)       (12,151)         6,666
Writedown and loss on sale of mining interests (note 4)        12,508         31,684
---------------------------------------------------------------------------------------------------
Income (loss) from operations                                 (22,627)       (43,835)         6,666
---------------------------------------------------------------------------------------------------
Other income (expense)
  Other income                                                  2,396          2,096          3,595
  Convertible debenture interest expense                         (526)          (639)          (661)
---------------------------------------------------------------------------------------------------
                                                                1,870          1,457          2,934
---------------------------------------------------------------------------------------------------
Income (loss) before taxes                                    (20,757)       (42,378)         9,600
Income and mining taxes (recovery) (note 7)                        91         (1,968)           588
---------------------------------------------------------------------------------------------------
Net income (loss)                                            $(20,848)      $(40,410)      $  9,012
===================================================================================================
Earnings (loss) per share (note 6)                           $  (0.14)      $  (0.27)      $   0.06
===================================================================================================
</TABLE>

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS (DEFICIT)
--------------------------------------------------------------------------------
for the years ended December 31, (Expressed in thousands of Canadian dollars)

<TABLE>
<CAPTION>
                                                                 1998           1997           1996
<S>                                                          <C>             <C>            <C>    
Balance at beginning of year                                 $(16,709)       $23,701        $14,689
Net income (loss)                                             (20,848)       (40,410)         9,012
---------------------------------------------------------------------------------------------------
Balance at end of year                                       $(37,557)      $(16,709)       $23,701
===================================================================================================
</TABLE>

        See accompanying notes to the consolidated financial statements.


                                                                              21
<PAGE>   24

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------
for the years ended December 31, (Expressed in thousands of Canadian dollars)

<TABLE>
<CAPTION>
                                                                        1998           1997           1996
<S>                                                                 <C>            <C>            <C>     
Cash provided by (used in):
Operating activities
Net income (loss)                                                   $(20,848)      $(40,410)      $  9,012
Items not involving cash
  Depreciation and amortization                                        6,211          9,587          9,604
  Writedown and loss on sale of mining interests                      12,508         30,239
  Exploration amortized and written-off                                1,980          4,998          2,599
  Deferred mining taxes (recovery)                                      (582)        (2,569)           358
  Other                                                                1,142         (1,289)          (134)
----------------------------------------------------------------------------------------------------------
                                                                         411            556         21,439
Net change in non-cash operating working capital                       2,551          2,945         (2,478)
----------------------------------------------------------------------------------------------------------
                                                                       2,962          3,501         18,961
----------------------------------------------------------------------------------------------------------

Financing activities
Issues of capital stock                                                2,207          2,820         33,565
Conversion of convertible debentures                                  (2,030)          (611)        (3,006)
----------------------------------------------------------------------------------------------------------
                                                                         177          2,209         30,559
----------------------------------------------------------------------------------------------------------

Investing activities
Expenditures on mining interests                                      (8,141)       (29,283)       (13,968)
Proceeds on sale of assets                                             3,876
Termination of hedging contracts                                                      9,679
Acquisition of Cerro Quema gold project                                                            (13,185)
Mining tax credits received                                                                            669
Decrease in other assets                                                 313            165            214
----------------------------------------------------------------------------------------------------------
                                                                      (3,952)       (19,439)       (26,270)
----------------------------------------------------------------------------------------------------------

Effect of exchange rate change on cash and short-term deposits           571            162           (219)
----------------------------------------------------------------------------------------------------------

Increase (decrease) in cash and short-term deposits                     (242)       (13,567)        23,031
Cash and short-term deposits at beginning of year                     41,735         55,302         32,271
----------------------------------------------------------------------------------------------------------
Cash and short-term deposits at end of year                         $ 41,493       $ 41,735       $ 55,302
==========================================================================================================

Changes in non-cash operating working capital
  Receivables                                                       $  2,152       $  3,465       $   (433)
  Inventories and prepaids                                             2,707          1,638         (2,997)
  Accounts payable                                                    (1,735)        (1,515)         1,184
  Accrued liabilities                                                   (573)          (643)          (232)
----------------------------------------------------------------------------------------------------------
                                                                    $  2,551       $  2,945       $ (2,478)
==========================================================================================================
</TABLE>

        See accompanying notes to the consolidated financial statements.


22
<PAGE>   25

----------------
Financial Review
----------------

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
(Tabular amount are expressed in thousands of Canadian dollars)

1     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements are prepared by management in accordance
with accounting principles generally accepted in Canada and, except as described
in note 12, conform in all material respects with accounting principles
generally accepted in the United States. The principal accounting policies
followed by the Company, which have been consistently applied, are summarized as
follows:

Intercorporate Investments: The consolidated financial statements include the
accounts of the Company and its subsidiaries. All significant intercompany
balances and transactions have been eliminated on consolidation.

Cash and Short-Term Deposits: Cash and short-term deposits includes short-term
money market instruments which are highly liquid and intended to be held to
maturity and are carried at amortized cost which approximates market. The
Company's policy is to invest in highly rated instruments and to limit the
amount of credit exposure to any one institution.

Inventories: Mining and milling materials and supplies are valued at the lower
of average cost and net replacement cost. Work-in-process is valued at the lower
of average production cost or net realizable value. Production costs include
direct labour, benefits, supplies and equipment operating costs and maintenance.

Mining Interests: Plant and equipment are recorded at cost with depreciation
generally provided either on the unit-of-production method over the estimated
economic life of the mine to which they relate or on the straight-line method
over their estimated useful lives.

Mining properties and deferred mining expenditures are recorded at cost and are
depleted on the unit-of-production method over the estimated economic life of
the mine to which they relate. Development costs incurred to expand existing
capacity, develop new ore bodies and develop property substantially in advance
of production are capitalized.

Exploration expenditures are charged to income in the period incurred except
where these costs relate to specific properties for which economically
recoverable reserves exist, in which case they are deferred. Significant
property payments for active exploration properties are capitalized. If no
mineable ore body is discovered, previously capitalized costs are expensed.

Mining properties and deferred expenditures are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of these
assets may not be recoverable. If estimated future net cash flows expected to
result from the use of the properties and their eventual disposition are less
than the carrying amount, then these properties are written down to their
estimated recoverable amount determined on a non-discounted basis.

Site Restoration: Provisions are established for estimated future costs of site
restoration of mining properties, including the removal of production facilities
at the end of their useful lives. Costs are based upon estimates of the
anticipated method and extent of site restoration to meet current legal and
industry standards. These standards are continually changing and the estimated
provision is reviewed annually. The amount of the provision is amortized over
the estimated life of the underlying asset and the annual charge, determined on
the same basis as the amortization of the underlying asset, is included in
mining costs.

Recognition of Metals Revenue: Gold and copper revenues are recognized at the
time of production. Receivables include gold and gold concentrate settled
subsequent to year end, which are recorded at estimated net realizable value.

Commodity and Foreign Exchange Contracts: The Company uses forward and option
contracts to hedge the effect of exchange rate changes on foreign currency
exposures, and forward and option contracts to hedge the effect of price changes
on a portion of the commodities it sells. Gains and losses on hedging
instruments that effectively establish prices for future production are not
recognized in income until reflected in sales revenue when the related
production is delivered. From time to time, the Company has entered into options
contracts for the sale of commodities not designated as hedges. These contracts
are carried at quoted market values and gains and losses arising from the
changes in the market values of these contracts are recognized in earnings in
the period in which the changes occur.

Currency Translation: The U.S. dollar is considered to be the functional
currency of the Company's Mexican operations as most of those activities are
conducted in U.S. dollars. Accordingly, the Mexican operations are translated
from Mexican pesos into U.S. dollars using the temporal method whereby monetary
assets and liabilities are translated at the year end rate of exchange and
non-monetary assets and liabilities are translated at historical rates of
exchange. Exchange gains or losses are included in the determination of
earnings.


                                                                              23
<PAGE>   26

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

The U.S. dollar financial statements of the Mexican operations are translated
into Canadian dollars at the year end rate of exchange for the balance sheet and
the average rate of exchange for the year for the statement of income. Exchange
gains or losses are included as a separate component of shareholders' equity.
The Panamanian operations are translated into Canadian dollars using the
temporal method.

Use of estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities and the reported amounts of
revenue and expense during the period. Actual results could differ from
estimates. During the fiscal periods presented, management has made a number of
significant estimates and valuation assumptions, including estimates of the net
realizable value of accounts receivable, inventory, the useful lives of capital
assets, the recoverability of net resource properties, the future costs
associated with environmental and site restoration matters, and the fair value
of financial assets and liabilities. These estimates and valuation assumptions
are based on current information and management's planned course of action, as
well as assumptions about future business and economic conditions. Should the
underlying valuation assumptions and estimates change, the recorded amounts
could change by a material amount.

Comparative Figures: Certain comparative figures have been reclassified to
conform with the current financial statement presentation.

2     INVENTORIES

<TABLE>
<CAPTION>
                                                         1998               1997
<S>                                                    <C>                <C>   
Materials and supplies                                 $4,538             $5,519
Work-in-process                                                            1,731
--------------------------------------------------------------------------------
                                                       $4,538             $7,250
================================================================================
</TABLE>

3     OTHER ASSETS

<TABLE>
<CAPTION>
                                                          1998              1997
<S>                                                     <C>               <C>   
Advances                                                $  257            $  590
Deferred financing costs                                   434               603
--------------------------------------------------------------------------------
                                                           691             1,193
Accumulated amortization                                   189               207
--------------------------------------------------------------------------------
                                                        $  502            $  986
================================================================================
</TABLE>

4     MINING INTERESTS

<TABLE>
<CAPTION>
                                             1998                                              1997

                                         Accumulated                                        Accumulated
                                      Depreciation and                                   Depreciation and
                          Cost           Amortization            Net         Cost           Amortization            Net
                          ------------------------------------------         ------------------------------------------
<S>                       <C>              <C>              <C>              <C>              <C>              <C>     
Property, plant
  & equipment             $ 24,850         $ 16,138         $  8,712         $ 29,239         $ 14,639         $ 14,600
Mining properties
  and deferred
  expenditures             149,016          104,611           44,405          122,495           87,506           34,989
Construction in
  progress                                                                     18,522                            18,522
-----------------------------------------------------------------------------------------------------------------------
                          $173,866         $120,749         $ 53,117         $170,256         $102,145         $ 68,111
=======================================================================================================================
</TABLE>

During 1998, as part of its periodic evaluation of the carrying value of its
mining interests, the Company wrote down the carrying value of its Cerro Quema
project in Panama by $10,200,000. In 1997 the Company wrote down the carrying
value of the Joe Mann Mine by $28,000,000.

During 1992, the Company entered into agreements under which the Societe
Quebecoise d'Exploration Miniere ("Soquem") could earn a 50% interest in the Joe
Mann property (excluding the Joe Mann Mine) and in the Company's other
properties in the Chibougamau area by incurring specified amounts on exploration
on those properties. To July 1, 1997, Soquem had incurred total qualifying
expenditures under the previous agreements of $2,548,000 on the Joe Mann
property and $2,431,000 on the Chibougamau property. Effective July 2, 1997, the
agreements were modified to provide that Soquem spend an additional $1,600,000
on the Joe Mann property and an additional $750,000 on the Chibougamau property
from the effective date until June 1, 2002 to earn a 50% interest in each of the
properties. To December 31, 1998, Soquem had incurred total qualifying
expenditures under the new amendment of approximately $83,000 on the Joe Mann
property and $31,000 on the Chibougamau area property.

On January 26, 1996 the Company purchased the right of first refusal to acquire
a 100% interest in the shares of Minera Cerro Quema, SA, whose primary asset is
the Cerro Quema gold project in Panama. Concurrently the Company exercised the
right of first refusal and purchased the shares for US$8,372,000 cash closing on
March 4, 1996. The Company paid the former holder of the right of first refusal
("CEMSA") US$250,000 cash and issued 730,000 common shares on closing and an
additional US$250,000 cash and 730,000 common shares on February 21, 1997
following approval by the Board of Directors of a positive feasibility study for
the Cerro Quema gold project. The aggregate cost of the acquisition, including
the cost of reducing the royalty payable to CEMSA from 3.5% to 2% through the
issuance of 1,040,000 common shares, and expenses, amounted to $15,598,000 and
has been included in mining interests.


24
<PAGE>   27

----------------
Financial Review
----------------

5     CONVERTIBLE DEBENTURES

In July 1994, the Company issued US$11,005,000 of 7.5% Convertible Subordinated
Debentures. The debentures are unsecured, bear interest at 7.5% payable in
arrears on June 1 and December 1 each year and mature on July 21, 2004. The
debentures are convertible at the option of the holder into common shares of the
Company at any time prior to maturity at a conversion of US$0.50 per common
share. The debentures are redeemable for cash at any time after the fifth
anniversary of the date of issue or, at the Company's option, may be redeemed in
common shares on the basis of one common share for each US$0.50 of debenture
principal being redeemed. The right of the Company to redeem the debentures for
cash or common shares is conditional on the average price of the Common Shares
exceeding US$0.50 during a period of 20 consecutive days prior to notice of
redemption. The Company may, at its option, repay the debenture at maturity by
issuing common shares of the Company at the conversion price of US$0.50 per
common share.

During 1998, debenture holders converted US$1,444,000 (1997 - US$454,000; 1996 -
US$2,307,000) of debenture principal into 2,888,000 (1997 - 908,000; 1996 -
4,614,000) common shares of the Company resulting in a balance outstanding at
December 31, 1998 of US$3,693,000 (1997 - US$5,137,000; 1996 - US$5,591,000).

6     CAPITAL STOCK

a)    Authorized shares

Preference shares - unlimited, issuable in series, without par value

Common shares - unlimited

b)    Issued and outstanding shares (in thousands)

<TABLE>
<CAPTION>
                                         1998                        1997                       1996

                                 Shares        Amount        Shares        Amount        Shares        Amount
<S>                             <C>          <C>            <C>          <C>            <C>          <C>     
Common shares:
  Balance at
    beginning
    of period                   151,445      $121,425       148,588      $118,605       124,466      $ 85,040
Issued:
  Conversion of
    convertible
    debentures                    2,888         2,030           908           611         4,614         3,006
  Public issue for cash                                                                  18,000        28,585
  Issued to CEMSA
    (note 4)                                                  1,770         2,071           730         1,256
  Employee Incentive Plan
    and Directors' Stock
    Option Plan                     353           177           179           138           778           718
-------------------------------------------------------------------------------------------------------------
                                154,686      $123,632       151,445      $121,425       148,588      $118,605
=============================================================================================================
</TABLE>

c)    Employee Incentive Plan

The Employee Incentive Plan comprises a Share Option Plan, a Share Purchase
Plan, a Share Bonus Plan and a Share Loan Plan. The Share Purchase Plan calls
for Company contributions of an amount equal to 50 per cent of the employees'
contributions, which can amount to a maximum of 5 per cent of their basic annual
salaries or wages. The common shares are issued on a quarterly basis at market
value.

Under the Share Bonus Plan, shares can be issued to full-time salaried employees
as a bonus in recognition of services as determined by the Compensation
Committee or the Board of Directors.

The Share Loan Plan provides the Compensation Committee or the Board of
Directors the discretion to make loans to full time employees to enable them to
acquire shares in the Company. No loans are outstanding under this plan.

Options granted under the Directors' and Employee share option plans expire not
later than five years from the date on which they were granted and all current
options expire on or before August 18, 2003. Changes in the share option plans
are as follows (in thousands):

<TABLE>
<CAPTION>
                                             1998           1997           1996
<S>                                        <C>            <C>            <C>   
Balance at beginning of year                7,250          7,175          5,090
Granted                                     2,325            450          2,900
Exercised                                                    (19)          (790)
Expired                                    (2,550)          (356)           (25)
--------------------------------------------------------------------------------
Balance at end of year                      7,025          7,250          7,175
================================================================================
Average option price at
  end of year                              $ 0.93         $ 1.15         $ 1.18
================================================================================
Options exercisable at
  end of year                               5,994          6,037          5,319
================================================================================
Average price for options
  exercised during year                    $  n/a         $ 0.57         $ 0.82
================================================================================
</TABLE>

d)    Common share purchase warrants

As part of a public offering of units consisting of common shares and warrants
in February, 1996, the Company issued 9,000,000 warrants which entitled the
holder to purchase one common share of the Company for US$1.50 on or before
February 26, 1999. All of the warrants expired unexercised.

e)    Earnings (loss) per share

The weighted average number of common shares outstanding during the year ended
December 31, 1998 used to calculate the earnings (loss) per common share
amounted to 153,532,000 (1997 - 150,548,000; 1996 - 145,907,000). Outstanding
warrants and options were not dilutive to earnings (loss) per share in any of
the periods presented.


                                                                              25
<PAGE>   28

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

7     INCOME AND MINING TAXES

a)    Geographic components

The geographic components of income (loss) before taxes is as follows:

<TABLE>
<CAPTION>
                                 1998                 1997                 1996
<S>                          <C>                  <C>                  <C>     
Canada                       $ (6,562)            $(32,729)            $  3,089
Mexico                         (3,855)              (9,101)               6,511
Panama                        (10,340)                (548)
--------------------------------------------------------------------------------
                             $(20,757)            $(42,378)            $  9,600
================================================================================
</TABLE>

The geographic components of income and mining taxes is as follows:

<TABLE>
<CAPTION>
                                            1998            1997            1996
<S>                                      <C>             <C>             <C>    
Current income tax expense:
Canada                                   $    55         $   220         $   229
Mexico                                       618             381               1
--------------------------------------------------------------------------------
                                             673             601             230
Deferred mining tax expense
  (recovery) - Canada                       (582)         (2,569)            358
--------------------------------------------------------------------------------
                                         $    91         $(1,968)        $   588
================================================================================
</TABLE>

b)    Deferred mining taxes

The payment of certain mining taxes is deferred due to the recognition of
amounts for tax purposes in different periods than for accounting purposes. The
principal timing difference is depreciation and amortization.

c)    Loss carry forwards

At December 31, 1998, the Company and its subsidiaries had operating losses for
income tax purposes in Canada approximating $640,000 and in Mexico approximating
$19,100,000 which are available to reduce taxes in future years and expire over
the period to the year 2007. In addition, the Company and its subsidiaries had
net capital losses for income tax purposes in Canada of approximately
$15,100,000 available to apply against future taxable capital gains. The
Company's subsidiary has an additional $17,200,000 of net capital loss carry
forwards which have not been accepted by the tax authorities. The Company is
objecting to the tax authorities' position. The Company also had unclaimed
deductions for Canadian Federal income tax purposes in excess of carrying values
for financial statement purposes of approximately $61,000,000 in Canada and
$12,500,000 in its foreign subsidiaries. The potential future benefit of these
tax losses and deductions has not been recognized in these financial statements.

d)    Effective tax rate

The provision for (recovery of) income taxes varies from the amounts that would
be computed by applying the Canadian federal and provincial statutory tax rates
of approximately 40% to income before taxes as follows:

<TABLE>
<CAPTION>
                                              1998          1997           1996
<S>                                       <C>           <C>            <C>     
Expected income tax
  provision (recovery) using
  statutory income tax rates              $ (8,341)     $(16,785)      $  4,173
Resource allowance                             (67)         (167)        (1,800)
Mining taxes (recovery)                       (582)       (2,569)           358
Tax benefit of losses
  not currently recognized                   7,541        16,952          1,235
Non-deductible expenses                        867
Utilization of prior year losses
  carried forward                                                        (2,922)
Foreign earnings subject
  to different tax rates                                                   (687)
Other                                          673           601            231
--------------------------------------------------------------------------------
Income and mining tax
  provision (recovery)                    $     91      $ (1,968)      $    588
================================================================================
</TABLE>

8     COMMITMENTS AND CONTINGENCIES

a)    At December 31, 1998 the Company had sold calls for 33,200 ounces of gold
      in 2001 and 20,000 ounces of gold in 2002 at approximately US$350 per
      ounce.

b)    At December 31, 1998, the Company had sold forward US$7,000,000 to
      purchase Canadian dollars during 1999 at an average rate of Cdn$1.4473 to
      the US dollar.

c)    The Company's Joe Mann Mine is subject to a graduated net smelter return
      royalty increasing from 1.8% up to a gold price of Canadian $512 per ounce
      to 3.6% at a gold price of Canadian $625 per ounce.

d)    During 1996, the Company's Mexican subsidiary received import duty
      assessments following an audit claiming the subsidiary's interest in
      certain pieces of machinery and equipment with an approximate value of
      US$2,200,000 and levying taxes, penalties, interest and inflationary
      adjustments for a further Mexican pesos 9,200,000. On May 26, 1997, the
      Company received notice that it was successful in its appeal against the
      assessments and that the Mexican pesos 9,200,000 was not payable. The
      charge against the assets will be released when the final tax assessment
      covering this matter is issued in favour of the Company by the tax
      authorities.


26
<PAGE>   29

----------------
Financial Review
----------------

      On May 6, 1998, the tax authorities issued a tax assessment identical to
      that issued in 1996 except that the amounts claimed have increased to
      Mexican pesos 18,000,000 as a result of inflation and additional interest.
      The Company has been advised that this assessment is improper as it
      completely ignores the earlier ruling. Accordingly the Company has filed a
      new appeal before the Federal Tax Court to nullify the assessment. No
      provision has been made in the financial statements for the amounts
      assessed on the basis of the earlier ruling and the legal advice received.

e)    During 1991, a subsidiary of the Company entered into a corporate
      restructuring and financing arrangement ("Arrangement") in which it issued
      to a group of Canadian financial institutions $38,000,000 of Guaranteed
      Subordinate Debentures and Notes ("Debentures") and $12,000,000 of
      Guaranteed Non-Cumulative Redeemable Retractable Preferred Shares
      ("Preferred Shares"). The Debentures are unsecured, subordinate to all
      existing non-trade debt and future senior debt, bear interest at varying
      rates, are repayable upon maturity in 2007, and cannot be prepaid. The
      Preferred Shares are redeemable at any time at an amount of $240,000 per
      Preferred Share, rank equally and parri passu with the common shares for
      dividends when declared, and are retractable in 2007. In order to secure
      the performance of the Debentures and Preferred Shares the Company's
      subsidiary entered into an Interest Rate and Currency Exchange Swap
      Agreement ("Swap Agreement") with a major international bank. The Swap
      Agreement provides for the conversion of one floating rate interest basis
      to another and for differences in the timing of payments so as to match
      the interest payment requirements under the Debentures, repay the
      Debentures upon maturity and retract the Preferred Shares. All payments
      are denominated in Canadian dollars. The Company's subsidiary placed
      Canadian dollar deposits with the counter party to the Swap agreement
      which deposits have been charged to secure the performance under the Swap
      Agreement. These deposits earn interest at Canadian Bankers Acceptance
      rates. The Swap Agreement was irrevocably assigned directly to the
      investors. Accordingly the bank is the primary obligor under the
      Arrangement.

f)    The Company is from time to time involved in various claims, legal
      proceedings and reassessments for income, mining and other taxes, arising
      in the ordinary course of business. The Company's current and proposed
      mining and exploration activities are subject to various laws and
      regulations governing the protection of the environment. These laws and
      regulations are continually changing and are generally becoming more
      restrictive. The Company conducts its operations so as to protect its
      employees, the general public and the environment and, to the best of its
      knowledge, believes its operations are in compliance with all applicable
      laws and regulations, in all material respects. The Company has made, and
      expects to make in the future, submissions and expenditures to comply with
      such laws and regulations. Where estimated reclamation and closure costs
      are reasonably determinable, the Company has recorded a provision for
      environmental liabilities based on management's estimate of these costs.
      Such estimates are subject to adjustment based on changes in laws and
      regulations and as new information becomes available.

g)    The Year 2000 Issue arises because many computerized systems use two
      digits rather than four to identify a year. Date-sensitive systems may
      recognize the year 2000 as 1900 or some other date, resulting in errors
      when information using year 2000 dates is processed. In addition, similar
      problems may arise in some systems which use certain dates in 1999 to
      represent something other than a date. The effects of the Year 2000 Issue
      may be experienced before, on, or after January 1, 2000, and, if not
      addressed, the impact on operations and financial reporting may range from
      minor errors to significant systems failure which could affect an entity's
      ability to conduct normal business operations. Although the Company is
      addressing this issue, it is not possible to be certain that all aspects
      of the Year 2000 Issue affecting the entity, including those related to
      the efforts of customers, suppliers, or other third parties, will be fully
      resolved.

9     PENSION PLAN

The Company maintains a defined benefit pension plan for certain employees which
provides benefits based on length of service and remuneration. The most recent
actuarial valuation of the plan was as at December 31, 1996. As at December 31,
1998, the estimated projected benefit obligation was approximately $2,754,000
(1997 - $2,659,000) and the market value of assets aggregated $3,508,000 (1997 -
$3,410,000).


                                                                              27
<PAGE>   30

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

10    SEGMENTED DATA

The Company's operations consist principally of the exploration, development,
mining and processing of precious metals in Canada, Mexico and Panama. The
following is a summary of the Company's operations by geographic area:

<TABLE>
<CAPTION>
                                      1998               1997               1996
<S>                                <C>                <C>                <C>    
Revenue:
Canada                             $31,030            $35,443            $38,226
Mexico                               5,358             17,192             28,954
--------------------------------------------------------------------------------
                                   $36,388            $52,635            $67,180
================================================================================
</TABLE>

Revenues are attributed to countries based on the source of the production.
During 1998 the Company sold approximately 35% (1997- 28%; 1996 - 24%) of its
product to one smelter.

<TABLE>
<CAPTION>
                                          1998             1997             1996
<S>                                    <C>              <C>              <C>    
Mining interests:
Canada                                 $33,054          $32,688          $59,821
Mexico                                  10,963           12,182           13,472
Panama                                   9,100           22,632           16,596
Other                                                       609              683
--------------------------------------------------------------------------------
                                       $53,117          $68,111          $90,572
================================================================================
</TABLE>

11    FAIR VALUE AND CREDIT RISK DISCLOSURES

At December 31, 1998 the fair value of the Company's convertible debentures was
estimated to be $5,840,000 (1997 - $8,810,000) compared to the carrying amount
of $5,652,000 (1997 - $7,341,000) based on a quoted price. The carrying amount
of cash and short-term deposits, receivables and accounts payable in the
consolidated balance sheets approximates fair value based on their short-term
maturities.

The fair value of the Company's foreign currency hedging contracts is a loss of
approximately $576,000 (1997 - $505,000).

The Company is exposed to credit-related losses in the event of non-performance
by counter parties to financial instruments but does not expect any counter
parties to fail to meet their obligations. The Company deals with only highly
rated counter parties, normally major financial institutions including banks.
The credit risk exposure of derivative instruments is represented by the fair
value of contracts with a positive fair value at the reporting date. The credit
risk represents the maximum amount that would be at risk if the counter parties
failed completely to perform under the contracts.

12    DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED
      ACCOUNTING PRINCIPLES

The reconciliation of net income (loss) determined in accordance with generally
accepted accounting principles in Canada to net income (loss) determined under
accounting principles which are generally accepted in the United States is as
follows:

<TABLE>
<CAPTION>
                                            1998            1997            1996
<S>                                     <C>             <C>             <C>     
Net income (loss) for year
  as reported                           $(20,848)       $(40,410)       $  9,012
Depreciation and
  amortization (a)                        (9,389)         19,061          (1,513)
Deferred income taxes (b)                    285          (6,083)           (158)
Foreign exchange
  contracts (f)                             (576)
--------------------------------------------------------------------------------
Net income (loss) for the
  year in accordance with
  United States accounting
  principles                            $(30,528)       $(27,432)       $  7,341
--------------------------------------------------------------------------------
Other comprehensive
  income (loss):
Foreign currency
  translation adjustments                    986             656             (73)
--------------------------------------------------------------------------------

Comprehensive income (loss)
  for the year in accordance
  with United States
  accounting principles                 $(29,542)       $(26,776)       $  7,268
================================================================================

Earnings (loss) per share
  for the year in accordance
  with United States
  accounting principles
  Basic and fully diluted               $  (0.20)       $  (0.18)       $   0.05
================================================================================
</TABLE>

Differences between Canadian and United States accounting principles as they
affect the Company's financial statements are as follows:

a)    Depreciation and Amortization

Under Canadian accounting principles, depreciation and amortization may be
calculated on the unit-of-production method based upon the estimated mine life,
whereas under United States accounting principles the calculations are made
based upon proven and probable mineable reserves. Under Canadian accounting
principles capital assets should be written down to the net recoverable amount
if this exceeds the carrying amount, whereas under United States accounting
principles if the future net cash flows is less than the carrying amount the
capital asset should be written down to its fair value.


28
<PAGE>   31

----------------
Financial Review
----------------

b)    Deferred Income Taxes

Under Canadian accounting principles income and mining taxes may be accounted
for under the deferral method. Under United States accounting principles the
asset and liability method (FAS 109) is used, whereby deferred tax assets and
liabilities are recognized for the deferred taxes attributable to differences
between book value and the tax basis of the Company's assets and liabilities.

Significant components of the Company's deferred tax assets and liabilities
under United States accounting principles are as follows:

<TABLE>
<CAPTION>
                                                          1998             1997
<S>                                                   <C>              <C>     
Noncurrent deferred tax assets:
Mining interests                                      $ 37,956         $ 32,136
Operating loss carry forwards                            6,745            6,309
Other                                                    1,676            1,352
--------------------------------------------------------------------------------
                                                        46,377           39,797
Valuation allowance                                     45,281           38,057
--------------------------------------------------------------------------------
                                                      $  1,096         $  1,740
--------------------------------------------------------------------------------

Current deferred tax liabilities:
Inventory                                             $    987         $  1,679
Noncurrent deferred tax liabilities:
Mining interests                                           869            1,736
Other                                                      109               61
--------------------------------------------------------------------------------
                                                      $  1,965         $  3,476

Net deferred tax liabilities                          $   (869)        $ (1,736)
================================================================================
</TABLE>

The tax loss carry forwards disclosed in note 7(c) and other temporary
differences giving rise to deferred taxes have been tax effected for purposes of
the above disclosure at the tax rate effective in the applicable jurisdiction,
that is, 40% for Canada, 34% for Mexico.

c)    Stock Options

Beginning in 1996, United States accounting principles allow, but do not require
companies to record compensation cost for stock option plans at fair value. The
Company has chosen to continue to account for stock options using the intrinsic
value method as permitted under Canadian and United States accounting
principles. The United States accounting pronouncement does, however, require
the disclosure of pro forma net income and earnings per share information as if
the Company had accounted for its employee stock options issued in prior years
under the fair value method. Accordingly, the fair value of these options has
been estimated at the date of grant using a Black-Scholes option pricing model
with the following assumptions for each year; risk free interest rates for 1998
of 5.50% (1997 - 5.15-6.30%; 1996 - 5.25-5.70%); dividend yields of 0%;
volatility factors of the expected market price of the Company's common shares
of 55%; and a weighted average expected life of the options of four years.

The weighted average grant date fair values of options issued in 1998, 1997 and
1996 were $0.21, $0.43 and $0.72, respectively. For purposes of pro forma
disclosures, the estimated fair value of the options is expensed over the
options' vesting period, which is three years in the case of employees and
immediately in the case of Directors. For the year ended December 31, 1998, the
Company's pro forma net income (loss) and earnings (loss) per share in
accordance with United States accounting principles are a net loss of
$31,432,000 (1997 - net loss $27,951,000; 1996 net income of $6,385,000) and a
loss of $0.20 (1997 loss of $0.19; 1996 earnings of $0.04).

d)    Statements of Cash Flows

Under Canadian accounting principles, the issuance of common shares on the
conversion of convertible debentures and as part of the purchase consideration
for the acquisition of the Cerro Quema project has been reflected as a financing
activity in the consolidated statements of cash flows. Under United States
accounting principles, these non-cash transactions would have been excluded from
financing activities and separately disclosed in the notes to the consolidated
financial statements.

Included in cash and short-term deposits at December 31, 1998 are investments of
$nil (1997 - $28,097,000; 1996 - $49,427,000) with maturities on acquisition of
greater than 90 days. Under United States accounting principles these
investments would not be included in cash and short-term deposits.

For the year ended December 31, 1998, under United States accounting principles
the sources of cash from financing activities would be $177,000 (1997 -
$138,000; 1996 - $29,303,000) the sources of cash from investing activities
would be $24,145,000 (1997 - source of $3,962,000; 1996 - use of $74,441,000)
and there would be a increase in cash and short-term deposits of $27,855,000
(1997 - increase of $7,763,000; 1996 - decrease of $26,396,000).

The following additional disclosures are also required:

<TABLE>
<CAPTION>
                                            1998            1997            1996
<S>                                         <C>             <C>             <C> 
Cash taxes paid                             $770            $695            $565
Cash interest paid                          $502            $616            $596
</TABLE>


                                                                              29
<PAGE>   32

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

e)    Contingent Liability

Under United States accounting principles the contingent liability disclosed in
note 8 (e) would be reflected in the balance sheet. Accordingly, under United
States accounting principles total assets and liabilities would increase by $50
million. The increase in assets represents investments (non-current) comprising
Canadian dollar payments under the Swap Agreement and Canadian dollar deposits
with the counter party to the Swap Agreement. The liabilities (non-current)
represent the Guaranteed Subordinate Debentures and Notes of $38 million and the
Guaranteed Non-Cumulative Redeemable Retractable Preferred Shares of $12 million
which would be included outside of shareholders' equity.

f)    Foreign Exchange Contracts

In accordance with Canadian accounting principles, certain long-term foreign
exchange contracts are considered to be hedges of sales revenue denominated in
foreign currencies or the cost of goods to be purchased in foreign currencies.
Gains and losses related to changes in market values of such contracts are
deferred and recognized when the contract is settled as part of sales revenue or
the cost of purchased goods as appropriate. Under United States accounting
principles, changes in the market value of the contracts would be included in
current earnings.

g)    Balance Sheets

The cumulative effect of the application of United States accounting principles,
noted in (a) to (f) above, on the consolidated balance sheets of the Company as
at December 31, 1998 and 1997 would be to decrease cash and short-term deposits
and increase short-term investments each by $nil (1997 - $28,097,000), decrease
mining interests by $23,403,000 (1997 - $14,014,000), increase other liabilities
by $576,000 (1997 $nil), increase long-term investments by $50,000,000 (1997 -
$50,000,000), increase long-term liabilities by $38,000,000 (1997 -
$38,000,000), decrease deferred mining taxes by $2,747,000 (1997 - $2,462,000),
increase preferred shares by $12,000,000 (1997 - $12,000,000) and reduce
shareholders equity by $21,232,000 (1997 - $11,552,000).

h)    Other Recent Accounting Pronouncements

In June 1998, the FASB issued SFAS No. 133 "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 establishes methods of
accounting for derivative financial instruments and hedging activities related
to those instruments as well as other hedging activities. The Company will be
required to implement SFAS No. 133 for its fiscal year ending December 31, 2000.
The Company has not yet determined the impact, if any, of the adoption of SFAS
No. 133 on its reported financial position, results of operations or cash flows.


30
<PAGE>   33

----------------
Financial Review
----------------

FIVE YEAR COMPARATIVE SUMMARY OF SELECTED FINANCIAL DATA
--------------------------------------------------------------------------------

<TABLE>
Year Ended December 31                                1998            1997           1996         1995         1994
<S>                                             <C>              <C>            <C>          <C>          <C>   
Operating results (in thousands):
Metal sales                                     $   36,388          52,635         67,180       67,418       46,940
Net income (loss)                               $  (20,848)        (40,410)         9,012       10,461        5,307
Cash flow from operations (before change in
  non-cash operating working capital)           $      411             556         21,439       18,703        5,970
Capital Expenditures                            $    8,141          29,283         13,968        7,934        6,889
Financial position (in thousands):
Cash and short-term deposits                    $   41,493          41,735         55,302       32,271       23,172
Total assets                                    $  102,777         123,882        165,298      123,703      113,780
Long-term debt                                  $    5,652           7,341          7,657       10,782       15,438
Shareholders' equity                            $   87,469         105,124        142,058       99,554       84,800
Per share data:
Net income (loss) per share                     $    (0.14)          (0.27)          0.06         0.09         0.05
Book value per share                            $     0.57            0.69           0.96         0.80         0.72
Operational statistics:
Gold production - ounces                            82,400         112,700        124,800      120,100       81,300
Gold revenue per ounce - US dollars             $      304             336            396          402          410
Cash cost per ounce - US dollars                $      255             288            252          247          293
Shares outstanding (in thousands):
At year end                                        154,686         151,445        148,588      124,466      117,528
Weighted average during year                       153,532         150,548        145,907      121,214      117,274
Foreign exchange rate - US dollars:
Year end/average                                $0.65/0.67       0.70/0.73      0.73/0.73    0.73/0.73    0.71/0.73
High/low                                        $0.71/0.63       0.75/0.69      0.75/0.72    0.75/0.70    0.76/0.71
</TABLE>

SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
--------------------------------------------------------------------------------

(Expressed in thousands of Canadian dollars, except per share amounts)

<TABLE>
<CAPTION>
                                      1st Quarter    2nd Quarter   3rd Quarter   4th Quarter
<S>                                      <C>               <C>           <C>           <C>  
Year ended December 31, 1998
Metal sales                              $ 10,281          9,241         8,847         8,019
Loss from operations                     $ (2,151)        (2,551)       (3,575)      (14,350)
Net loss                                 $ (1,730)        (2,003)       (3,190)      (13,925)
Net loss per share                       $  (0.01)         (0.01)        (0.02)        (0.09)

Year ended December 31, 1997
Metal sales                              $ 12,289         13,569        12,979        13,798
Loss from operations                     $ (3,260)        (1,773)       (3,650)      (35,152)
Net loss                                 $ (2,782)        (1,771)       (3,368)      (32,489)
Net loss per share                       $  (0.02)         (0.01)        (0.02)        (0.21)
</TABLE>


                                                                              31
<PAGE>   34

------------------------------
[LOGO] Campbell Resources Inc.
------------------------------

SHAREHOLDER INFORMATION
--------------------------------------------------------------------------------

Campbell Resources Inc. common shares are listed on the New York, Toronto and
Montreal stock exchanges and trade under the symbol "CCH".

Quarterly Trading Statistics

<TABLE>
<CAPTION>
Common Share Prices
----------------------------------------------------------------------------------------------
                           Toronto Stock Exchange                  New York Stock Exchange
                                   (Cdn$)                                    (US$)
----------------------------------------------------------------------------------------------
                       High          Low       Volume           High          Low       Volume
----------------------------------------------------------------------------------------------
<S>                    <C>          <C>     <C>                 <C>          <C>    <C>       
1998
4th Quarter            0.65         0.34    1,416,133           0.47         0.22   18,271,600
3rd Quarter            0.56         0.35    1,171,353           0.41         0.25   16,252,500
2nd Quarter            0.70         0.46    2,599,624           0.50         0.31   21,353,109
1st Quarter            0.80         0.50    2,496,000           0.63         0.34   24,880,500
----------------------------------------------------------------------------------------------

1997
----------------------------------------------------------------------------------------------
4th Quarter            1.02         0.51    2,311,854           0.75         0.34   34,417,134
3rd Quarter            1.00         0.68    2,348,237           0.81         0.50   15,816,900
2nd Quarter            1.12         0.85    3,595,200           0.81         0.56   14,138,200
1st Quarter            1.30         1.01    3,589,700           1.00         0.75   21,623,200
----------------------------------------------------------------------------------------------
</TABLE>

                               [GRAPHIC OMITTED]

CCH.TO Closing                                                  Closing Bid Spot
Share Price                                                           Gold Price

                     <<<NEED PLOT POINTS FOR THIS GRAPH>>>

Transfer Agent

Montreal Trust Company
151 Front Street West
8th Floor
Toronto, Ontario M5J 2N1
Phone: (416) 981-9500
Fax: (416) 981-9800

Montreal Trust Company
Place Montreal Trust
1800 McGill College Avenue
Montreal, Quebec
H3A 3K9

ChaseMellon Shareholder Services
85 Challenger Road
Overpeck Center
Ridgefield Park, New Jersey
U.S.A. 07660

Financial Publications

A copy of the Annual Report on Form 10-K filed with the U.S. Securities and
Exchange Commission, or copies of the Annual Report and Quarterly Reports may be
obtained without charge, upon request.

Inquiries

Inquiries regarding shareholder-related matters, including change of address
notifications, can be directed to the Secretary or to the Transfer Agent.

Questions regarding the Company's operating and financial performance may be
directed to the Manager, Investor Relations at (416) 366-5201.


32
<PAGE>   35

---------------------
Corporate Information
---------------------

BOARD OF DIRECTORS

James D. Beatty (2,3)
Chief Executive Officer
Trinity Capital Corporation

Graham G. Clow
President & Chief Executive Officer
Manhattan Minerals Corporation

Rod P. Douglas (2)
Mining Engineer

John O. Kachmar (1)
President & Chief Executive Officer
Campbell Resources Inc.

James C. McCartney, Q.C. (1,3)
Partner, Law Firm of McCarthy Tetrault

Donald R. Murphy (2)
President, Societe de developpement
de la Baie James

Francis S. O'Kelly
Mining Engineer

G.E. 'Kurt' Pralle (3)
Mining Engineer

James D. Raymond (1)
Private Investor

(1)   Member of Executive Committee

(2)   Member of Audit Committee

(3)   Member of Compensation Committee

LEGAL COUNSEL

McCarthy Tetrault
Toronto, Ontario

AUDITORS

KPMG LLP
Toronto, Ontario

PRINCIPAL SUBSIDIARIES

Meston Resources Inc. (Quebec, Canada)

Oro de Sotula, S.A. de C.V. (Mexico)
Dr. Guillermo Salas Piza, Chairman

Minera Cerro Quema, S.A. (Panama)

OFFICERS AND SENIOR MANAGEMENT

James C. McCartney, Q.C.
Chairman of the Board

John O. Kachmar
President & Chief Executive Officer

Paul J. Ireland
Vice President, Finance & Chief Financial Officer

Lorna D. MacGillivray
Vice President, Secretary & General Counsel

William S. Hamilton
Manager, Exploration Santa Gertrudis

Steven Dawson
Manager, Investor Relations

OPERATIONS

Joe Mann Mine
Meston Resources Inc.
Phone: (418) 745-2537
Fax: (418) 745-3238
Alain Coulombe, General Manager

Santa Gertrudis Mine
Oro de Sotula S.A. de C.V.
Phone: (52-631) 76668
Fax: (52-631) 76668
Dave Loder, General Manager

Cerro Quema Project
Minera Cerro Quema, S.A.
Phone: (507) 996-9978
Fax: (507) 996-2780
George J. Simchuk, Vice President
& General Manager

CORPORATE HEAD OFFICE

Campbell Resources Inc.
120 Adelaide Street West
Suite 1910
Toronto, Ontario
Canada M5H 1T1
Phone: (416) 366-5201
Fax: (416) 367-3294
e-mail: invest@campbellresources.com

Production: Walter J. Mishko & Co. Inc.
Design:     Kirkwood Communications Inc.
            Printed in Canada on re-cycled paper
            using vegetable based inks
<PAGE>   36

Campbell Resources Inc.

120 Adelaide Street West, Suite 1910
Toronto, Ontario, Canada M5H 1T1
Telephone: (416) 366-5201
Fax: (416) 367-3294