Malaga narrows its net loss by $245,000 during Q1 2009



    Symbol: MLG
    Toronto Stock Exchange (TSX)

    MONTREAL, May 19 /CNW Telbec/ - Malaga Inc. (TSX: MLG) is pleased to
report its financial results for the 3-month period ended March 31, 2009. The
consolidated financial statements (all currency figures appear in Canadian
dollars unless otherwise specified) along with the management's discussion and
analysis are available for the viewing on the Malaga website at www.malaga.ca
and the documents have been filed with SEDAR at www.sedar.com.

    
    Q1 2009 HIGHLIGHTS

    - Signing of a new 5-year tungsten supply contract as well as a financing
      agreement that was closed on April 1st by which Malaga is to receive US
      $5.0 million (US$3.4 million has already been received), without
      interest for the first 12-month period. The funds are to be used to
      increase the production capacity from 250 tons per day to 500 tons per
      day
    - Sales of 17,092 MTUs (11,850 MTUs for Q1 2008), an increase of 44%
    - Sales of $3.4 million, an increase of 78% as compared to $1.9 million
      for Q1 2008
    - Net loss in Q1 2009 of $0.6 million ($0.8 million in Q1 2008), a
      decrease of $0.2 million
    - Ore grade of 0.90% of WO(3) for MTUs produced and sold, as compared to
      0.82% for Q1 2008
    - Production from the Huayllapon I sector began during Q1

    Mine development and underground exploration will be aggressively pursued
during Q2 2009 following the closing of the above-mentioned financing
agreement on April 1st. Purchasing of the new mining equipment (front loaders,
electric carts and electrical transformers, etc.) that will be needed to
increase the production capacity in 2010 is underway.
    The existing 250 tons per day (tpd) ore processing plant will be upgraded
to a capacity of more than 500 tpd (maximum planned capacity is 600 tpd). All
the necessary engineering studies have been completed and the construction
phase is to begin shortly. This phase will take about 5 months to complete.

    PRODUCTION

    Mine production for the 3-month period ending March 31, 2009 is summarized
below:

                                                         2009          2008
    -------------------------------------------------------------------------
    Tons of ore mined                                  20,179        20,253
    -------------------------------------------------------------------------
    Grade (%)                                             0.9          0.79
    -------------------------------------------------------------------------
    Production (MTU)                                   15,602        13,039
    -------------------------------------------------------------------------
    

    OUTLOOK

    Malaga has begun the upgrading its ore processing plant and the mine's
infrastructure and has begun purchasing the necessary equipment in order to
increase its production capacity to 500 tpd with the overall goal of improving
the Company's profitability. Target date for the 500 tpd production capacity
at Pasto Bueno is Q1 2010.

    ABOUT MALAGA INC.

    Malaga Inc. is a tungsten mining company that uses modern, efficient and
productive mining technology. The Company is committed to growth, through
increasing its tungsten concentrate production, continuing the exploration of
the Pasto Bueno property, and through strategic acquisitions. It also seeks
diverse growth opportunities such as developing the hydroelectric potential of
the Pasto Bueno property, through Hidropesac, in which the Company holds 44%,
as well as through its holding in Dynacor Gold Mines Inc., in which the
Company owns 13.3%.

    FORWARD-LOOKING INFORMATION

    Certain statements in the foregoing may constitute forward-looking
statements, which involve known and unknown risks, uncertainties and other
factors that may cause the actual results, performance or achievements of
Malaga, or industry results, to be materially different from any future
result, performance or achievement expressed or implied by such
forward-looking statements. These statements reflect management's current
expectations regarding future events and operating performance as of the date
of this news release.




For further information:

For further information: Jean Martineau, President & CEO, Malaga Inc.,
(514) 288-3224

Organization Profile

MALAGA INC.

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