SEMAFO reports net earnings of $11.7 million for the second quarter 2008



    Record Gold Production, Operating Income and Operating Cash Flow

    SEMAFO TSX-SMF

    MONTREAL, Aug. 12 /CNW Telbec/ - SEMAFO (TSX: SMF) today reported record
financial and operational results for the three-month period ended June 30,
2008. All amounts are stated in US dollars unless otherwise stated.

    Highlights

    The Company delivered record results during the second quarter ended
June 30, 2008, with gold sales of $44,826,000 representing an increase of 147%
over the corresponding period in 2007. Gold production reached 54,500 ounces
for the quarter, an increase of 80% over the same period last year. Highlights
for the second quarter include:

    
    - Gold production of 54,500 ounces
    - Gold sales of $44,826,000 at an average selling price of $904 per ounce
    - Cash operating cost of $394 per ounce
    - Total cash cost of $455 per ounce
    - Operating income of $13,822,000
    - Net income of $11,681,000
    - Cash flow from operating activities of $19,304,000
    - Commencement of commercial production at the Mana mine in Burkina Faso
    

    A Word from the CEO

    With three mines in operation, 2008 marked the beginning of a turning
point for the Company. Since the beginning of this year, the Company delivered
profits in its three operations and has focused on maximizing the cash flow
from operating activities. During the second quarter of 2008, cash flow from
operating activities totalled $19,304,000, representing 188% of the operating
cash flow generated during the entire 2007 year.
    Despite the rapid rise of fuel and consumable costs, Semafo has reduced
its cash operating cost by 17% to $394 per ounce for the second quarter of
2008 compared to $473 for the second quarter 2007.  The total cash cost during
the three-month period ending June 30, 2008 decreased 12% to $455 per ounce
from $517 per ounce for the corresponding period in 2007.
    The second quarter of 2008 marked the commencement of commercial
production at the Mana mine in Burkina Faso, and the third time that Semafo
has successfully brought a West African mine into operation.  Furthermore, the
Company achieved a 29% increase in gold production compared to the previous
quarter at our Samira Hill and Kiniero mines.

    

    Financial and Operating Highlights

                               Three-month period       Six-month period
                                  ended June 30           ended June 30
                           --------------------------------------------------
                                             Varia-                   Varia-
                              2008    2007    tion     2008    2007    tion
                           --------------------------------------------------
    Gold ounces produced    54,500  30,200      80%  83,200  59,200      41%
    Gold ounces sold        49,600  27,500      80%  77,800  55,600      40%

    (In thousands of
     dollars, except
     amounts per ounce,
     per tonne and per
     share)
    Revenues - Gold sales   44,826  18,136     147%  70,366  36,712      92%
    Operating costs         22,582  14,749      53%  39,711  28,228      41%
    Operating income (loss) 13,822  (2,039)    778%  16,623  (1,969)    944%
    Net income (loss)       11,681  (2,083)    661%  24,183  (5,316)    555%
    Average selling price
     (per ounce)               904     659      37%     905     660      37%
    Cash operating cost
     (per ounce
     produced) (1)             394     473     (17%)    441     463      (5%)
    Cash operating cost
     (per tonne
     processed) (1)             35      28      25%      31      26      19%
    Total cash cost (per
     ounce sold)             2 455     517     (12%)    510     498       2%
    Basic and diluted net
     income (loss) per
     share                    0.05   (0.01)    600%    0.11   (0.03)    468%
    Cash flow from
     operating
     activities (3)         19,304   1,591   1,113%  25,427   5,462     366%

    (1) Cash operating cost is calculated using ounces produced and tonnes
        processed. See the section "Non-GAAP measures" of the MD&A.

    (2) Total cash cost represents cash operating cost plus royalties and
        selling expenses and also the effects of inventory adjustments.

    (3) Cash flow from operating activities excludes changes in non-cash
        working capital items and settlement of liabilities related to asset
        retirement obligations for property, plant and equipment.

    Outlook

    In July 2008, overall production totalled 18,000 ounces of gold;
7,800 ounces at Mana, 6,300 ounces at Samira Hill and 3,900 ounces at Kiniero.
    At Mana, the new 4,000 tonne-per-day ball mill has been installed with
commissioning started at the end of July 2008.
    Semafo is committed to increase shareholder value and remains confident
that it will meet its 2008 production target of between 165,000 and
185,000 ounces of gold.
    A conference call will be held at 10:00 a.m. on Wednesday, August 13, 2008
to discuss the Company's quarterly results. Details to access the call can be
found on the home page of the Company's website at www.semafo.com. Semafo's
consolidated financial statements, together with Management's Discussion and
Analysis are available on its website or at www.sedar.com.

    About SEMAFO

    Semafo is a Canadian-based mining company with gold production and
exploration activities in West Africa. The Company currently operates three
gold mines in Burkina Faso, Niger and Guinea. Semafo is committed to evolve in
a conscientious manner to become a major player in its geographical area of
interest, while maintaining principles and strengthening relationships to
increase shareholder value.

    FORWARD-LOOKING STATEMENTS

    This press release may contain forward-looking statements. These
forward-looking statements include, but are not limited to, statements
regarding expectations of the Company as to the market price of gold,
strategic plans, future commercial production, production targets, timetables,
mining operating expenses, capital expenditures, and mineral reserve and
resource estimates. Forward-looking statements involve known and unknown risks
and uncertainties and accordingly, actual results and future events could
differ materially from those anticipated in such statements. Factors that
could cause future results or events to differ materially from current
expectations expressed or implied by the forward-looking statements include,
but are not limited to, fluctuations in the market price of precious metals,
mining industry risks, uncertainty as to calculation of mineral reserves and
resources, risks related to hedging strategies, risks of delays in
construction, requirements of additional financing and other risks described
in the Company's documents filed from time to time with Canadian securities
regulatory authorities. Although the Company is of the opinion that these
forward-looking statements are based on reasonable assumptions, those
assumptions may prove to be incorrect. Accordingly, readers should not place
undue reliance on forward-looking statements. Readers can find further
information with respect to risks in the Annual Information Form of the
Company and other filings of the Company with Canadian securities regulatory
authorities available at www.sedar.com. The Company disclaims any obligation
to update or revise these forward-looking statements, except as required by
applicable law.
    




For further information:

For further information: SEMAFO: Benoit La Salle, President & CEO, (514)
744-4408, blasalle@semafo.com; Renmark: Maurice Dagenais:
mdagenais@renmarkfinancial.com; Jason Roy: jroy@renmarkfinancial.com, (514)
939-3989, Fax: (514) 939-3717; www.renmarkfinancial.com

Organization Profile

SEMAFO INC.

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