Shore Gold Inc. announces first quarter results



    Stock Symbol: SGF: TSX

    SASKATOON, May 13 /CNW/ - Shore Gold Inc. ("Shore" or the "Company")
reports that the unaudited results of Shore's operations for the quarter ended
March 31, 2009 will be filed today on SEDAR and may be viewed at www.sedar.com
once posted. A summary of key financial and operating results for the quarter
is as follows:

    
    Highlights

    -   Announced the eighth and final set of diamond results from the
        underground bulk sampling program on Orion South, with total diamond
        recoveries of 1,414.00 carats from 8,040.90 processed tonnes of Early
        Joli Fou kimberlite
    -   Announced the reconciliation of diamond grade results from large
        diameter ("LD") mini-bulk sampling with underground bulk sampling
    -   Received $4.4 million from an initial payment of principal relating
        to the Company's restructured asset-backed commercial paper
    -   Working capital of $16.9 million at March 31, 2009
    -   Issued and outstanding shares of 199,904,242 at March 31, 2009
    

    Overview

    Star Diamond Project

    The Company continues with the Star Diamond Project pre-feasibility
study. This primarily involves desk-top engineering studies and data analysis
required to convert the Mineral Resource to a Mineral Reserve conforming to
National Instrument ("NI") 43-101 and Canadian Institute of Mining, Metallurgy
and Petroleum ("CIM") standards. During the first quarter of 2009, the Company
announced an updated NI 43-101 compliant Mineral Resource estimate for the
explored portion of the Star Kimberlite (See SGF News Release February 27,
2009), which supersedes the previously published Resource estimate (See SGF
News Release June 9, 2008). The updated Mineral Resource estimate increases
the indicated tonnage and contained carats for the Star Kimberlite by 23
percent when compared to the initial Mineral Resource estimate published in
June 2008. Shore anticipates the delivery of a final feasibility study on the
Star Diamond Project by the end of the first quarter of 2010.
    The Company also recently announced the reconciliation of diamond grade
results from LD mini-bulk sampling with underground bulk sampling for the Star
Kimberlite (See SGF News Release April 21, 2009). The reconciliation of LD
mini-bulk sampling to underground bulk sampling results is necessary since
diamond breakage and diamond loss occurs when sampling kimberlite by LD
drilling. As a result of this breakage and loss, this method of sampling
underestimates the sample grade (carats per hundred tonnes, or "cpht"). The LD
grade reconciliation factors have been calculated both internally and by
independent qualified persons and were used in the determination of the
updated Mineral Resource estimate for the Star Kimberlite. The grade
reconciliation of LD mini-bulk sampling diamond results to underground bulk
sampling diamond results assists in the understanding and evaluation of the
large kimberlites of the FALC area where only LD mini-bulk samples are
available.

    FALC-JV Programs

    During the first quarter of 2009, the Company concentrated on the
completion of the capital intensive data gathering exploration programs on
Orion South. As a result of these efforts, the Company announced the eighth
and final set of diamond results from the Orion South underground bulk
sampling program (See SGF News Release April 28, 2009). Included in these
results were 480.56 carats from 2,561.11 tonnes of processed Early Joli Fou
("EJF") kimberlite. The EJF is the most important kimberlite lithology in
terms of tonnes and grade in Orion South as estimated by the current
geological model. Overall, a total of 1,414.00 carats were recovered from
8,040.90 tonnes of EJF processed from the Orion South underground bulk
sampling program. This grade of approximately 18 cpht compares favourably with
the bulk sample grade of the EJF in the Star Kimberlite of approximately 18
cpht.
    In total, 2,346.27 carats were recovered from the processing of 23,467.98
tonnes of kimberlite from the Orion South underground bulk sampling program.
Of this tonnage, approximately 34 percent of the kimberlite processed was from
the EJF kimberlite lithology.
    The diamond parcel recovered from the underground and LD sampling of
Orion South will provide grade and price estimates for use in an NI 43-101
Mineral Resource estimate of the Orion South Kimberlite. Shore aims to
calculate a Mineral Resource estimate for Orion South during 2009.

    Year to Date Results

    For the quarter ended March 31, 2009, the Company recorded a net loss of
$3.9 million or $0.02 per share compared to a net loss of $2.2 million or
$0.01 per share for the same period in 2008. The loss during the quarter ended
March 31, 2009 was primarily due to the $5.7 million write-down of mineral
property expenditures incurred during the first quarter on the FALC-JV and
other mineral properties. This was offset by a reduction in future income tax
liabilities related to the renunciation of the November 2008 flow-through
financing. The net loss for the comparative period in 2008 was primarily due
to the fair value of stock-based compensation expensed ($1.9 million).

    
    Selected financial highlights include:

    -------------------------------------------------------------------------
                                                           As at      As at
                                                         March 31,    Dec 31,
    Consolidated Balance Sheets                            2009        2008
    -------------------------------------------------------------------------
    Current assets                                      $ 20.6  M   $  35.4 M
    -------------------------------------------------------------------------
    Capital and other assets                              231.0 M     231.6 M
    -------------------------------------------------------------------------
    Current liabilities                                     3.7 M      11.8 M
    -------------------------------------------------------------------------
    Long-term liabilities                                   1.5 M       1.6 M
    -------------------------------------------------------------------------
    Share capital                                         769.5 M     772.8 M
    -------------------------------------------------------------------------
    Contributed surplus                                    25.9 M      25.9 M
    -------------------------------------------------------------------------
    Deficit                                               549.0 M     545.1 M
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                                          For the    For the
                                                          Quarter    Quarter
                                                           Ended      Ended
    Consolidated Statements of Loss                      March 31,  March 31,
     and Comprehensive Loss                                2009        2008
    -------------------------------------------------------------------------
    Interest and other income                           $   0.1 M   $   0.7 M
    -------------------------------------------------------------------------
    Operating expenses                                      1.3 M       3.0 M
    -------------------------------------------------------------------------
    Loss for the period before other items                 (1.2)M      (2.3)M
    -------------------------------------------------------------------------
    Write-down of mineral properties                      (5.7) M         - M
    -------------------------------------------------------------------------
    Change in fair value of investments                   (0.3) M         - M
    -------------------------------------------------------------------------
    Future income taxes                                     3.3 M       0.1 M
    -------------------------------------------------------------------------
    Net loss for the period                                (3.9)M      (2.2)M
    -------------------------------------------------------------------------
    Loss per share (basic and diluted)                    (0.02)      (0.01)
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                                          For the    For the
                                                          Quarter    Quarter
                                                           Ended      Ended
                                                         March 31,  March 31,
    Consolidated Statements of Cash Flows                  2009        2008
    -------------------------------------------------------------------------
    Cash flows from operating activities                $  (2.2)M   $  (1.4)M
    -------------------------------------------------------------------------
    Cash flows from investing activities                   (9.8)M      (8.7)M
    -------------------------------------------------------------------------
    Net decrease in cash                                  (12.0)M     (10.1)M
    -------------------------------------------------------------------------
    Cash - beginning of period                              22.6M       31.8M
    -------------------------------------------------------------------------
    Cash - end of period                                    10.6M     21.7  M
    -------------------------------------------------------------------------
    

    Outlook

    As of May 5, 2009, the Company had approximately $20.2 million in cash
and cash equivalents and short-term investments, which includes the $4.4
million initial payment of principal relating to the Company's restructured
asset-backed commercial paper. These funds will be used to complete the Star
Diamond Project pre-feasibility study, to fund the planned FALC-JV and the
Buffalo Hills Joint Venture exploration programs and for general corporate
matters. Cash and cash equivalents and short-term investments may also be used
to fund various other exploration activities as well as acquisition and
exploration of additional properties as opportunities warrant.
    The Company continues with the Star Diamond Project pre-feasibility
study. This primarily entails desk-top engineering studies and data analysis
to convert the Mineral Resource to a Mineral Reserve conforming to NI 43-101
and CIM standards. The Company's intent is to have a NI 43-101 compliant
Reserve estimate for the Star Diamond Project completed during 2009. Shore
anticipates the delivery of a final feasibility study for the Star Diamond
Project by the end of the first quarter of 2010. In addition, the Company
anticipates an initial Mineral Resource estimate for Orion South to be
available in mid 2009. It is the present focus to evaluate the Star and Orion
South Kimberlites to the point where a production decision can be made.

    Caution Regarding Forward-looking Statements

    From time to time, Shore makes written or oral forward-looking statements
within the meaning of certain securities laws, including the "safe harbour"
provisions of the Ontario Securities Act and the United States Private
Securities Litigation Reform Act of 1995. Shore may make such statements in
this press release, in other filings with Canadian regulators or the United
States Securities and Exchange Commission, in reports to shareholders or in
other communications. These forward-looking statements include, among others,
statements with respect to Shore's objectives for the ensuing year, our medium
and long-term goals, and strategies to achieve those objectives and goals, as
well as statements with respect to our beliefs, plans, objectives,
expectations, anticipations, estimates and intentions. The words "may,"
"could," "should," "would," "suspect," "outlook," "believe," "plan,"
"anticipate," "estimate," "expect," "intend," and words and expressions of
similar import are intended to identify forward-looking statements.
    In particular, statements regarding Shore's future operations, future
exploration and development activities or other development plans contain
forward-looking statements. All forward-looking statements and information are
based on Shore's current beliefs as well as assumptions made by and
information currently available to Shore concerning anticipated financial
performance, business prospects, strategies, regulatory developments,
development plans, exploration, development and mining activities and
commitments. Although management considers these assumptions to be reasonable
based on information currently available to it, they may prove to be
incorrect.
    By their very nature, forward-looking statements involve inherent risks
and uncertainties, both general and specific, and risks exist that
predictions, forecasts, projections and other forward-looking statements will
not be achieved. We caution readers not to place undue reliance on these
statements as a number of important factors could cause the actual results to
differ materially from the beliefs, plans, objectives, expectations,
anticipations, estimates and intentions expressed in such forward-looking
statements. These factors include, but are not limited to, developments in
world diamond markets, changes in diamond valuations, risks relating to
fluctuations in the Canadian dollar and other currencies relative to the US
dollar, changes in exploration, development or mining plans due to exploration
results and changing budget priorities of Shore or its joint venture partners,
the effects of competition in the markets in which Shore operates, the impact
of changes in the laws and regulations regulating mining exploration and
development, judicial or regulatory judgments and legal proceedings,
operational and infrastructure risks and the additional risks described in
Shore's most recently filed Annual Information Form, annual and interim MD&A
and short form prospectus, and Shore's anticipation of and success in managing
the foregoing risks.
    Shore cautions that the foregoing list of factors that may affect future
results is not exhaustive. When relying on our forward-looking statements to
make decisions with respect to Shore, investors and others should carefully
consider the foregoing factors and other uncertainties and potential events.
Unless otherwise required by applicable securities legislation, Shore does not
undertake to update any forward-looking statement, whether written or oral,
that may be made from time to time by Shore or on our behalf.





For further information:

For further information: Mr. Kenneth E. MacNeill, Chief Executive
Officer and President Or Mr. Harvey J. Bay, Chief Financial Officer and Chief
Operating Officer, 300 - 224 4th Avenue South, Saskatoon, SK, S7K 5M5, PH:
(306) 664-2202, FAX: (306) 664-7181, Website: www.shoregold.com


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