TORONTO, Nov. 13, 2012 /CNW/ - Liberty Mines Inc. (TSX: LBE) ("Liberty"
or the "Company") today reported its financial results for the three-
and nine-month periods ended September 30, 2012. All amounts are in
"Since the start of 2012, we have completed a number of significant
milestones designed at positioning Liberty for the long term," said
Chris Stewart, President and CEO of Liberty Mines. "Included among
these were the re-furbishment of our tailings storage facility, the
shipment of more than 1.1 million pounds of payable nickel concentrate
to our primary customer Xstrata, lowering our average cash costs to
$8.02 per pound on a year to date basis, the expansion of our Hart East
Deposit, and the development of a positive preliminary economic
assessment for our Hart Deposit."
Mr. Stewart added, "Some of this progress was particularly reflected in
our third quarter results, which included a revenue total of $3.9
million, the shipment of approximately 372,000 pounds of payable nickel
concentrate, and the lowering of corporate and administration expenses
by more than $560,000. Despite the significant advances we have made
since implementing our turn-around strategy, we continue to face a low
nickel price environment that is delaying the re-start of our
operations. Until nickel prices recover sufficiently, we will operate
in a care and maintenance mode and preserve the value of our ore."
Q3 2012 Financial and Operational Highlights
Revenue was $3.9 million.
Production totalled 44,309 tonnes of material with an average grade of
Processed and shipped 423,265 pounds of nickel concentrate to the
Xstrata smelter in Sudbury.
Temporarily suspended its Timmins operations on August 14, 2012 due to a
low nickel price environment.
Announced a positive preliminary economic assessment for the Hart Nickel
Project in the Shaw Dome Region that included a pre-tax net present
value (NPV) of $35.8 million using an 8% discount rate, a $10 per pound
nickel price and a life of mine production of 38,497,588 pounds of
Selected Q3 Financial Highlights
All amounts in thousands except share data
September 30, 2012
September 30, 2011
Site operational costs
Net (loss) income
Basic earnings (loss) per share
September 30, 2012
December 31, 2011
Cash and Cash Equivalents
Review of Q3 Financial Performance
Revenue for Q3 2012 was $3.9 million, up from $159,000 for the
corresponding period of 2011. The growth was due to a re-start of
mining and milling operations effective March 31, 2012. Liberty had
suspended mining and milling operations in February 2011 due to
maintenance and repair work need for its tailings storage facility. In
Q3 2012, the average price of nickel was $7.41 per pound. In the
corresponding period of 2011, the average price of nickel was $10.00
per pound. As a result of declining nickel prices, Liberty announced
the temporary suspension of operations on August 14, 2012. For the
nine-month period of 2012, Liberty generated revenue of $9.3 million,
up from $2.2 million for 2011.
Liberty generates revenue through the sale of nickel concentrate and
related by-products produced from its mining and milling operations in
Timmins, Ontario. Liberty has a 100 percent off-take agreement with
Operating expenses for Q3 2012 were $5.8 million, up from $1.9 million
last year. The increase in operating expenses is primarily due to the
re-start and subsequent ramp-up of production activities through August
14, 2012. Liberty's production activities were suspended throughout Q3
2011, and the Company operated in a care and maintenance mode. For the
nine-month period 2012, operating expenses were $16.5 million, up from
$6.6 million. As previously noted, Liberty suspended operations on
August 14, 2012 due to declining nickel prices. The Company currently
operates its Timmins assets in a care and maintenance mode.
Net loss for Q3 2012 was $8.5 million or $0.04 per share (basic and
fully diluted). The loss included amortization/depletion expenses of
$2.6 million, interest on long-term debt of $2.8 million and dividends
on preferred shares of $0.3 million. Liberty recorded a net loss of
$8.5 million or $0.04 per share for the same period in 2011 when its
operations were suspended. For the nine month period of 2012, Liberty
recorded a net loss of $26.8 million or $0.13 per share. This compares
to a net loss of $18.2 million or $0.10 per share for the six-month
period of 2011.
At September 30, 2012, Liberty had cash and cash equivalents of $0.6
million. This compares to $1.3 million at year end 2011.
Liberty's financial statements for the period ended September 30, 2012
are available at www.libertymines.com and www.sedar.com. The financial statements should be read in conjunction with the
accompanying notes and management's discussion and analysis.
About Liberty Mines Inc.
Liberty Mines Inc. is a mid-tier producer of nickel and is focused on
the exploration, development and production of nickel, copper, cobalt
and platinum group metals from its properties in Ontario, Canada. It
owns and operates the only nickel concentrator in the Shaw Dome, a
prospective nickel belt region near Timmins, Ontario. With a new
management team in place, Liberty is focused on growth initiatives not
only through a more aggressive exploration program on its current
properties but also through potential acquisition or partnership
opportunities beyond its core Timmins area projects.
No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein. This News
Release includes certain "forward looking statements". All statements
other than statements of historical fact included in this release,
without limitation, statements regarding future plans and objectives of
Liberty, are forward looking statements that involve various risks and
uncertainties. There can be no assurance that such statements will
prove to be accurate and actual results and future events could differ
materially from those anticipated in such statements. Important factors
that could cause actual results to differ materially from Liberty's
expectations are: exploration risks; commodity prices; regulatory
approvals; receipt of mining permits and leases; and assumed startup
and operating costs detailed herein and from time to time in the
filings made by Liberty with securities regulators. Forward-looking
statements speak only as of the date on which they are made. The
Company undertakes no obligation to publicly update any such statement
or reflect new information or the occurrence of future events or
circumstances, except where required by securities regulations.
Accordingly, readers should not place undue reliance on forward-looking
SOURCE: Liberty Mines Inc.
For further information:
Chris Stewart, President & CEO
(416) 226-4360 ext 203
416 815 0700 ext 243