Minera Andes reports net income of $1 million for second quarter 2009

    TSX: MAI

    SPOKANE, WA, Aug. 14 /CNW/ - Minera Andes Inc. (the "Corporation" or
"Minera Andes") (TSX-MAI and US OTC: MNEAF) today reported net income of $1.0
million ($0.00 per share) in its financial statements for the three months
ended June 30, 2009, and a net loss of $3.3 million for the six months ended
June 30, 2009 ($0.01 per share). All amounts in this news release are in US
dollars unless otherwise noted. Our financial statements are available under
the Corporation's profile at www.sedar.com.
    Minera Andes' share of the net income derived from Minera Santa Cruz
S.A.("MSC") for the three months ended June 30, 2009, (before amortization),
was $2.6 million and for the six months ended June 30, 2009, was $2.7 million.
MSC is owned 49% by Minera Andes and 51% by Hochschild Mining plc
("Hochschild") (HOCM.L: Reuters and HOC LN: Bloomberg - London Stock
Exchange). MSC owns the San José silver-gold mine in southern Argentina, which
has recently expanded its processing capacity to a rate of 1,500 tonnes per
day. Hochschild is the operator of the San José Mine.
    The silver and gold sales from the San José Mine in the second quarter of
2009 totaled $41.0 million. During the first quarter 2009, total sales from
the San José Mine were $21.1 million. The weighted average gross sales prices
were $13.42/ounce of silver and $919/ounce of gold during the second quarter
of 2009 and $12.98/ounce of silver and $911/ounce of gold during the previous
quarter. San José's silver and gold sales are unhedged. The second quarter
2009 sales of silver and gold by the San José Mine were higher compared to
first quarter of 2009 due to built up processed product inventories of silver
and gold at the end of the first quarter that were sold in the second quarter
    Production cash operating costs (calculated on a co-product basis) for
the mine were $5.00 per ounce for 1,265,000 ounces of silver and $335 per
ounce for 18,080 ounces of gold. As previously reported, a total of 119,184
tonnes of ore was processed in the second quarter of 2009 with an average
grade of 400 grams per tonne of silver and 5.65 grams per tonne of gold. The
sale products are marketed in the form of concentrates and doré bullion. Cash
operating costs were $12.4 million for the quarter, which represents an
increase of 1% compared to the first quarter of 2009. The cash cost per tonne
also increased by 1% to $112.5 per tonne during the quarter.

    Brian Gavin, Minera Andes' Vice President of Exploration, who is a
"qualified person" as defined by National Instrument 43-101, is responsible
for the information used in this news release and has supervised the
preparation of the information and reviewed all information used in this news

    Minera Andes is a gold, silver and copper exploration company working in
Argentina. The Corporation holds or has an interest in approximately 304,000
acres of mineral exploration land in Argentina, including the properties
comprising the 49% owned San José silver/gold mine. Minera Andes is also
exploring the Los Azules copper project in San Juan province, where a scoping
study has been completed, a 43-101 technical report filed, and earn-in notice
delivered. Other exploration properties, primarily silver and gold, are being
evaluated in southern Argentina. The Corporation presently has 230,688,851
shares issued and outstanding. Rob McEwen, President and CEO of McEwen Capital
and former Chairman and CEO of Goldcorp, owns 37.3% of the issued shares of
the Company.

    Non-GAAP Financial Measures:

    In this news release, we use the term "operating cash cost." Operating
cash costs are defined as the sum of the geology, mining, processing plant,
general and administration costs as well as royalties, refining and treatment
charges and sales costs applied to doré, but with respect to concentrate sales
do not include refining, treatment charges and sales costs. The operating cash
costs per ounce are calculated on a co-product basis by dividing the
respective proportionate share of the total costs for the period for each
metal by the ounces of each respective metal produced. The proportionate share
of the total costs is calculated by multiplying the total cash costs by the
percentage of total production value that the respective metal represents. For
2009, approximately 52% of the value of the production was derived from silver
and 48% was derived from gold based on the year 2009 average London PM fix for
silver and for gold. We use operating cash cost per ounce as an operating
indicator. We provide this measure to our investors to allow them to also
monitor operational efficiency of MSC's mine at San José. Operating cash cost
per ounce should be considered as non-GAAP Financial Measure and should not be
considered in isolation or as a substitute for measures of performance
prepared in accordance with GAAP. There are material limitations associated
with the use of such non-GAAP Financial Measures. Since these measures do not
incorporate revenues, changes in working capital and non-operating cash costs,
they are not necessarily indicative of operating profit or cash flow from
operations as determined under GAAP. Changes in numerous factors include, but
are not limited to, mining rates, milling rates, silver and gold grades,
silver and gold recoveries, and the costs of labor, consumables and mine site
operations general and administrative activities that can cause these measures
to increase or decrease.

    Reliability of Information

    Minera Santa Cruz S.A., the owner of the San José mine, is responsible
for and has supplied to the Corporation all reported results from the San José
mine. This press release is based entirely on information provided to Minera
Andes by Minera Santa Cruz S.A. (MSC). Minera Andes' joint venture partner, a
subsidiary of Hochschild Mining plc, and its affiliates other than MSC do not
accept responsibility for the use of project data or the adequacy or accuracy
of this release. As the Corporation is not the operator of the San José mine,
there can be no assurance that production information reported to the
Corporation by MSC is accurate. The Corporation has not independently verified
such information and readers are therefore cautioned regarding the extent to
which they should rely upon such information.

    Caution Concerning Forward-Looking Statements:

    This news release contains forward-looking statements and forward-looking
information within the meaning of applicable US and Canadian securities laws.
Such forward-looking statements or information include expected production at
MSC's San José Project. In making the forward-looking statements and providing
the forward-looking information, we have made numerous assumptions. Although
our management believes that the assumptions made and the expectations
represented by such statements or information are reasonable, there can be no
assurance that the forward-looking statements will prove to be accurate.
Forward-looking statements and information involve known and unknown risks,
uncertainties and other factors that may cause our actual results to be
materially different from that expressed or implied by such forward-looking
information. Such risks, uncertainties and other factors include among other
things, declines in the price of gold, silver, copper and other base metals,
capital and operating cost increases, changes in general economic and business
conditions, including changes in interest rates and the demand for base
metals, economic and political instability in Argentina, discrepancies between
actual and estimated production and mineral reserves and resources;
operational and development risk; the speculative nature of mineral
exploration and regulatory risks.
    Readers should not place undue reliance on forward-looking statements or
information. We undertake no obligation to reissue or update forward-looking
statements or information as a result of new information or events after the
date hereof except as may be required by law. See our annual information form
for additional information on risks, uncertainties and other factors relating
to the forward-looking statements and information. All forward-looking
statements and information made in this news release are qualified by this
cautionary statement. Minera Andes' joint venture partner, a subsidiary of
Hochschild Mining plc, and its affiliates do not accept responsibility for the
use of project data or the adequacy or accuracy of this release.

For further information:

For further information: Art Johnson at the Spokane office, or Krister
A. Kottmeier, investor relations - Canada, at the Vancouver office; Visit our
Web site operations: www.minandes.com; Spokane Office, 111 East Magnesium
Road, Ste. A, Spokane, WA, 99208, USA, Phone: (509) 921-7322, E-mail:
info@minandes.com; Vancouver Office, 911-470 Granville Street, Vancouver,
B.C., V6C 1V5, Phone: (604) 689-7017, (877) 689-7018, E-mail:

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