TORONTO, March 27, 2013 /CNW/ - Liberty Mines Inc. (LBE; TSX) ("Liberty" or the "Company") today reported its financial results for the 12-month period ended December 31, 2012. All amounts are in Canadian currency.
"Bolstered by a new management team and strong support from our Timmins operation, we achieved each of our key milestones in the first half of 2012. Most notably, we restarted production in Q1, stabilized and increased production in Q2, and then we were faced with rapidly declining nickel prices in Q3. As a result, we had to make the difficult decision to move to a care and maintenance mode in mid-August until Nickel prices increase and stabilize", said Mr. Chris Stewart, President and CEO of Liberty Mines. "Throughout all of 2012 Liberty delivered outstanding Safety and Environmental results. We continue to have belief in the long term success of Liberty Mines and will be aggressive with our business plans going forward."
2012 Operational Highlights
- Delivered on the plan to restart operations at the McWatters mine and Redstone Nickel Concentrator in Q1 and produced 1.143MM pounds of nickel concentrate in 2012.
- Completed the Preliminary Economic Assessment (PEA) for the Hart Project. Provided a 43-101 technical report highlighting an estimated pre-tax Net Present Value (NPV) of $35.8 million using an 8% discount rate and an eight year mine life.
- Conducted an exploration program consisting of 7,591 metres of drilling during 2012, focused on deep exploration of the Hart Deposit, continued exploration of the Hart East Zone, the Redstone Deposit, and exploration of the "A6" area, located east of the Hart Deposit
- Implemented a care and maintenance program at the Company's Redstone and McWatters mines as of August 14, 2012
- Closed a series of transactions with Jilin Jien Nickel Industry Co. Ltd., and its wholly-owned subsidiary, Jien International Investments Ltd., Liberty's controlling shareholder. The transactions were designed to provide support for Liberty's 2013 business plan and restructure Liberty's financial obligations.
- Appointed Mr. Chris Stewart, CEO and Mr. James Xiang to the Company's board of directors.
- Appointed David Birch, CFO of the Company effective June 4, and Heather Miree, Vice President of Exploration effective May 23.
Operational Highlights Subsequent to Year-end
On January 23, Liberty Mines announced that it had identified the presence of chrysotile in its ore body at its McWatters Mine. As chrysotile, a form of asbestos, is a designated substance under Ontario Health and Safety Regulation, the Company is investigating these matters further and is taking all required measures.
The Company expects to conduct additional testing and further independent analysis to determine the impact on the economic feasibility of restarting mine operations at the McWatters Mine having regard to this information.
Review of 2012 Financial Performance
Revenue for 2012 was $8.99 million, up from $2.1 million for 2011. The increase was directly related to the increase in mining and milling operations initiated in March 2012.
In 2012, Liberty shipped 1,143,053 pounds of payable nickel concentrate to X-Strata in Sudbury at an average price of $8.02 per pound. In comparison during 2011, Liberty shipped 276,692 pounds of payable nickel concentrate at an average price of $10.36.
Net loss for 2012 was $64.4 million or $0.31 per basic and fully diluted share. The loss included a mineral properties impairment expense of $29.2 million, interest on long-term debt of $10.6 million. In 2011, Liberty recorded a net loss of $26.8 million or $0.14 per basic and fully diluted share. Liberty's mining and milling operations were fully functional in 2012 for 4 ½ months.
At December 31, 2012, Liberty had cash and cash equivalents of $0.6 million. This compares to cash of $1.3 million at year end 2011.
Liberty's financial statements for the year ended December 31, 2011 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 statements.
SOURCE: Liberty Mines Inc.
For further information:
Chris Stewart, President & CEO
(416) 226-4360 ext 203