Campbell Resources announces second quarter 2008 financial results



    YEAR-TO-DATE LOSS FROM OPERATIONS REDUCED BY APPROXIMATELY 29%
    YEAR-TO-DATE COPPER PRODUCTION INCREASED BY APPROXIMATELY 97%

    MONTREAL, Aug. 6 /CNW Telbec/ - Campbell Resources Inc. (the "Company")
("Campbell") (TSX: CCH, OTC Bulletin Board:   CBLRF) today announced financial
results for the second quarter and first six months of fiscal 2008 ended
June 30, 2008. During and subsequent to the period, the Company realized a
number of achievements:

    
    - Increased year-to-date ore production by approximately 78%
    - Increased year-to-date copper production by approximately 97%
    - Reduced year-to-date loss from operations by approximately 29%
    - Reached 105-metre level at Corner Bay
    - Identified vertical continuity of high-grade mineralized zone at Copper
      Rand
    - Completed $3.54 million financing
    - Increased credit facility with Nuinsco Resources Limited to a maximum
      aggregate amount of $5.0 million
    

    "The results for the second quarter show ongoing improvement," said André
Fortier, Campbell's President and Chief Executive Officer. "Production
continues to increase year-over-year and we are making steady progress in
reducing our losses from operations. At Corner Bay, the 105-metre level was
reached during the second quarter and some 10,000 tons of mineralized material
were extracted. However, progress has been slower than expected because of
operational and financial challenges. Copper production levels were down at
Copper Rand during the second quarter, largely due to lower copper grade in
the ore and to breakdowns to transportation equipment. From a financial
perspective, working capital deficiencies have also made it more difficult for
the Company to operate as effectively as possible. The reality is that these
challenges will persist until positive cash flow is generated, which should
occur in the fourth quarter of this year."

    FINANCIAL RESULTS

    As of January 1, 2007, results from the Copper Rand mine have been
included in the consolidated operating results. Prior to this, Copper Rand
mine was considered to be in the preproduction development stage and as such
all costs, net of revenue from development ore, were deferred as mine
development costs.
    As of September 11, 2007, operations at Joe Mann mine ceased and the mine
was put on care and maintenance. The Joe Mann mine was Campbell's principal
gold-mining operation.
    In October 2007, the Company commenced production at Merrill Pit.
    In the second quarter of 2008, Campbell operations produced 71,673 tons
of ore yielding 1,434 ounces of gold and 1,780,718 pounds of copper. In the
second quarter of 2007, 52,739 tons of ore were milled, yielding 4,921 ounces
of gold and 1,044,197 pounds of copper.
    For the first six months of fiscal 2008, Campbell operations produced
163,193 tons of ore yielding 4,024 ounces of gold and 3,947,785 pounds of
copper. In the first six months of fiscal 2007, 91,526 tons of ore were
milled, yielding 8,823 ounces of gold and 2,005,838 pounds of copper.
    A total of 2,439 ounces of gold and 2,328,460 pounds of copper were sold
in the second quarter of 2008 compared to 1,719 ounces of gold and Nil pounds
of copper for the same period of 2007. The average market price for gold in
the second quarter of 2008 was $905 (US$896) per ounce compared to
$732 (US$667) per ounce for the same period in 2007. The average market price
for copper in the second quarter of 2008 was $3.87 (US $3.84). In the second
quarter of 2008, the average sale price for gold was $903 per ounce compared
to $723 in the same period of 2007. For copper, the average sale price was
$3.70 per pound in the second quarter of 2008.
    Net metal sales for the second quarter of 2008 reached $9.0 million
compared to $1.4 million for the same period last year. For the first six
months of fiscal 2008, net metal sales totalled $9.7 million, compared to
$3.1 million in the corresponding period in 2007.
    As per the contract for the sale of concentrate between Campbell and
Ocean Partners UK Limited ("OP"), revenues for concentrate inventory shipped
cannot be recognized until the transfer of ownership is completed when the
concentrate is delivered to the discharge port. As at June 30, 2008,
$7.1 million of inventory valued at lowest of cost and net realizable value
was stored at Port of Quebec. On this amount of inventory, provisional
payments in the amount of $6.6 million were received from OP. The contract was
amended in March 2008 to allow the Company to borrow money on concentrate to
be shipped. As at June 30, 2008, the credit facility was not used.
    The loss from operations totalled $4.1 million in the second quarter of
2008, compared to $5.0 million loss in the prior period. For the first six
months of 2008, the loss from operations totalled $7.5 million, compared to a
$10.6 million loss from operations in the corresponding period in 2007, a
reduction of approximately 29%.
    For the second quarter of 2008, Campbell recorded a net loss of
$4.1 million or $0.01 per share, compared to a net loss of $4.3 million or
$0.01 per for the same period in 2007. For the first six months, Campbell
recorded a net loss of $6.2 million or $0.01 per share, compared to a net loss
of $6.1 million or $0.02 per share for the same period in 2007.

    OPERATING PERFORMANCE

    Copper Rand Mine

    The Copper Rand mine started commercial production on January 1, 2007.
Production at Copper Rand in the second quarter of 2008 was 37,303 tons
grading 0.040 Au oz/t (yielding 1,199 ounces of gold), 1.49% Cu (yielding
1,025,137 pounds of copper) and 0.136 Ag oz/t (yielding 3,192 ounces of
silver) with a recovery rate of 79.83% for gold, 91.97% for copper and 62.94%
for silver. In the second quarter of 2007, production totalled 24,656 tons
grading 0.048 Au oz/t (yielding 969 ounces of gold), 1.92% Cu (yielding
922,132 pounds of copper) and 0.15 Ag oz/t (yielding 2,209 ounces of silver)
with a recovery rate of 82.17% for gold, 97.54% for copper and 59.61% for
silver.
    For the first six months of fiscal 2008, Copper Rand produced 84,028 tons
of ore yielding 2,830,133 pounds of copper, 3,488 ounces of gold and
9,039 ounces of silver, compared 46,699 tons of ore yielding 1,817,338 pounds
of copper, 1,852 ounces of gold and 4,559 ounces of silver in the first six
months of fiscal 2007.
    There are currently three production areas at Copper Rand, identified as
"44-4," "4850 depth extension" and "Lower H-2." Campbell has also identified
the vertical continuity of higher-grade mineralized ore at the "Upper H-2"
area which should be available by the end of 2008. Two additional areas are
currently under evaluation ("52-5" at Shaft #6 and "level 1950" at Shaft #4).
Those two additional sectors could provide ore feed to the Copper Rand mill in
the second half of 2009. Campbell expects to be able to maintain current
production levels at Copper Rand in the coming months.

    Merrill Pit

    The first tons of ore from Merrill pit were milled in October 2007. In
the second quarter of 2008, a total of 24,375 tons of ore were milled, grading
0.45% copper (198,814 pounds), 0.008 oz/t gold (144 ounces) and 0.087 oz/t
silver (1,266 oz). The recovery rate was 90.26% for copper, 73.53% for gold
and 59.92% for silver. In the first six months of 2008, a total of 68,098 tons
were milled, yielding 517,339 pounds of copper, 420 ounces of gold and
3,790 ounces of silver. A major breakdown to the crusher occurred in early
March and operations at the pit only resumed in late April. Operations at the
Merrill pit were suspended in June as the term of the mining contractor's
agreement had expired. Campbell is currently in discussions with a new
contractor and hopes to resume operations at Merrill in the third quarter.

    Corner Bay Development

    In the second quarter of 2008, 9,995 tons of mineralized material were
extracted from Corner Bay and subsequently milled at the Copper Rand mill. The
material graded 3.07% copper (556,768 pounds), 0.012 oz/t gold (91 oz) and
0.240 oz/t silver (1,640 oz). The recovery rate was 90.83% for copper, 79.05%
for gold and 68.38% for silver.
    During the second quarter of 2008, $4.3 million net of revenues was
invested in the development of the project. Development to the 105 metre level
was achieved.
    At a 3% Cu cut-off, Corner Bay has measured and indicated resources of
446,000 tonnes (Ref : Technical Report prepared by Géostat in July 2006,
available on SEDAR at www.sedar.com).

    Joe Mann Mine

    Production at the Joe Mann mine ceased on September 11. In the second
quarter of 2007, Joe Mann produced 28,083 tons of ore. The yield was
3,952 ounces of gold, 122,065 pounds of copper and 2,670 ounces of silver. In
the first six months of 2007, Joe Mann produced 6,971 ounces of gold,
188,500 pounds of copper and 4,234 ounces of silver.
    On August 1, 2008, Campbell ceased pumping underground water which will
result in the flooding of the mine over time.

    OUTLOOK

    "The Company continues development for extraction of a bulk sample at
Corner Bay. Further, we are working to improve the efficiency of the Copper
Rand mine and to achieve positive cash flow by year end. Revenues for fiscal
2008 should be substantially higher than those realized in 2007 and we expect
to be able to meet the commitments related to the Plan of Arrangement for
Meston Resources Inc. in the coming months," Mr. Fortier said.

    CONFERENCE CALL

    Campbell Resources will hold a conference call on Wednesday, August 6,
2008 at 4 P.M (Eastern Time) to discuss this announcement.
    Interested parties can join the call by dialling 1-800-587-1893.

    About Campbell Resources

    Campbell Resources Inc. concentrates on the development and exploitation
of copper and gold mining properties in the Chibougamau region of Quebec. The
geographical grouping of its operations allows Campbell to realize economies
of scale and to focus development within access to existing infrastructures.
Campbell's main operations include the Copper Rand and Merrill mines, the
Corner Bay property and the Copper Rand mill. Campbell's headquarters are
located in Montreal, Quebec.

    Certain information contained in this release may contain
"Forward-Looking Statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 and is subject to certain risks, assumptions and
uncertainties, including those "Risk Factors" set forth in the Campbell's
current Annual Report on Form 20-F for the year ended December 31, 2007, which
may cause actual future results to differ materially from those expressed or
implied in any forward-looking statement. Such factors include, but are not
limited to: differences between estimated and actual mineral reserves and
resources; 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 and copper prices which
affect the profitability and mineral reserves and resources of Campbell. The
key assumptions underlying the forward-looking statements contained in this
release are that the gold and copper prices remain equal to or above the
prices disclosed herein. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date hereof.
Forward-looking statements are expressly qualified in their entirety by this
cautionary statement.


    
    CONSOLIDATED BALANCE SHEETS (UNAUDITED)

    (Expressed in thousands of Canadian dollars)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

                                                         June 30 December 31
                                                            2008        2007
    -------------------------------------------------------------------------
                                                               $           $
    Assets

    Current assets
      Cash                                                     2         474
      Restricted cash                                      1,113       1,113
      Short-term investments                                  31          33
      Receivables                                          1,683       3,066
      Settlements receivable                               1,232         739
      Concentrate and metal inventories                    7,428       1,218
      Supply inventories                                   2,569       2,882
      Prepaids                                               706         408
    -------------------------------------------------------------------------
                                                          14,764       9,933

    Amount receivable from Copper Rand/Portage
     Restoration Fiduciary Trust                           3,116       3,028
    Restricted cash                                        1,158       1,158
    Future income tax assets                               1,338       1,317
    Property, plant and equipment                         52,560      45,017
    Accrued benefit asset                                  5,054       4,897
    -------------------------------------------------------------------------
                                                          77,990      65,350
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities

    Current liabilities
      Short-term loan                                      4,343       1,996
      Accounts payable                                    19,225      15,411
      Accrued liabilities                                  9,329       5,954
      Prepayments for concentrate                          6,628         965
      Current portion of long-term debt                   18,453      18,337
    -------------------------------------------------------------------------
                                                          57,978      42,663

    Asset retirement obligations                           7,610       7,396
    Long-term debt                                         3,187       2,688
    Future income and mining tax liabilities               6,661       6,472
    -------------------------------------------------------------------------
                                                          75,436      59,219
    -------------------------------------------------------------------------

    Shareholders' equity

      Capital stock                                       98,812      96,639
      Warrants, stock options and conversion rights        7,541       9,432
      Contributed surplus                                  6,421       4,109

      Deficit                                           (110,209)   (104,040)
      Accumulated other comprehensive loss                   (11)         (9)
    -------------------------------------------------------------------------
                                                        (110,220)   (104,049)
    -------------------------------------------------------------------------
                                                           2,554       6,131
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          77,990      65,350
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

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

                                  Three months ended        Six months ended
                                         June 30                 June 30
                                    2008        2007        2008        2007
    -------------------------------------------------------------------------
                                                               $           $
    Gross metal sales             10,755       1,482      11,481       3,196
    Treatment charges              1,754          52       1,758          70
    -------------------------------------------------------------------------
    Net metal sales                9,001       1,430       9,723       3,126
    -------------------------------------------------------------------------

    Expenses
      Cost of sales               10,648       4,772      11,340       9,963
      Depreciation and
       amortization                  911         577       2,036       1,389
      General administration         825         628       1,493       1,362
      Warrants issued as fee
       for short-term financial
       arrangement                     -           -         427           -
      Reorganisation and CCAA
       costs                          34         102          34         207
      Care and maintenance           318          34         902          76
    -------------------------------------------------------------------------
                                  12,736       6,113      16,232      12,997
    -------------------------------------------------------------------------

    Loss before the following
     items                        (3,735)     (4,683)     (6,509)     (9,871)

    Interest expense on
     short-term loan                 (78)        (86)       (202)       (161)
    Interest and financial
     expenses on long-term debt     (317)       (288)       (792)       (568)
    Interest income                    5          20          19          28
    -------------------------------------------------------------------------
    Loss from operations          (4,125)     (5,037)     (7,484)    (10,572)

    Other income (expense)
      Other (expense) income           1         696        (307)      4,486
    -------------------------------------------------------------------------

    Loss before taxes             (4,124)     (4,341)     (7,791)     (6,086)

    Income and mining taxes            -           -       1,622           -
    -------------------------------------------------------------------------

    Net loss                      (4,124)     (4,341)     (6,169)     (6,086)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number
     of common shares ('000)     446,445     396,829     439,525     372,925
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Loss per share undiluted
     and diluted                   (0.01)      (0.01)      (0.01)      (0.02)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENTS OF CONTRIBUTED SURPLUS AND DEFICIT (UNAUDITED)

    (Expressed in thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                  Three months ended        Six months ended
                                         June 30                 June 30
                                    2008        2007        2008        2007
    -------------------------------------------------------------------------
                                                               $           $
    Contributed surplus

    Balance, beginning of period   4,191       3,991       4,109       1,996

    Stock options expired and
     cancelled                        44           -          69           -
    Warrants expired               2,186           -       2,243       1,995

    -------------------------------------------------------------------------
    Balance, end of period         6,421       3,991       6,421       3,991
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Deficit

    Balance, beginning of
     period                      106,085      86,797     104,040      84,825

    Net loss                       4,124       4,341       6,169       6,086
    -------------------------------------------------------------------------
    Balance, end of period       110,209      91,138     110,209      91,138
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

    (Expressed in thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                  Three months ended      Three months ended
                                         June 30                 June 30
                                    2008        2007        2008        2007
    -------------------------------------------------------------------------
                                                               $           $

    Net Loss                       4,124       4,341       6,169       6,086

    Other comprehensive income,
     net of income tax:
      Unrealized losses (gain)
       on available-for-sale
       investments arising
       during the period              (1)         50           2          79
    -------------------------------------------------------------------------
    Comprehensive loss             4,123       4,391       6,171       6,165
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    




For further information:

For further information: Campbell Resources Inc.: André Fortier,
President and Chief Executive Officer, (514) 875-9037, Fax: (514) 875-9764,
afortier@campbellresources.com; Alain Blais, Vice-president and General
Manager of Operations, (418) 748-7691, Fax: (418) 748-7696,
ablais@campbellresources.com; Renmark Financial Communications Inc.: Henri
Perron: hperron@renmarkfinancial.com; Eric St-Pierre:
estpierre@renmarkfinancial.com, (514) 939-3989, Fax: (514) 939-3717,
www.renmarkfinancial.com

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