International Minerals Reports $12.0 Million in Pre-Tax Income for Second Fiscal Quarter Ending December 31, 2011

International Minerals Corp.  / Key word(s): Quarter Results

15.02.2012 00:03

Release of an ad hoc announcement pursuant to Art. 53 KR
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NEWS RELEASE 

International Minerals Reports $12.0 Million in Pre-Tax Income 
for Second Fiscal Quarter Ending December 31, 2011

Scottsdale, Arizona, February 14, 2012 - International Minerals Corporation
(Toronto and Swiss stock exchanges: 'IMZ', the 'Company') reports
continuing excellent financial results for the second fiscal quarter ended
December 31, 2011 (the 'Current Quarter').

Current Quarter highlights include $12.0 million in pre-tax income and
$11.1 million in consolidated net and comprehensive income after tax ($0.09
per share), including net equity earnings of $13.1 million from the
Company's 40% interest (Hochschild Mining 60%) in the Pallancata Mine in
Peru.

For the six-month period ended December 31, 2011, the Company reported
pre-tax income of $27.2 million and consolidated net and comprehensive
income after tax of $26.3 million ($0.22 per share).

In addition, during the Current Quarter the Company received cash
distributions of $12.0 million from the Pallancata Mine, representing its
40% share of free cash flow from prior periods. IMZ anticipates that it
will receive its next cash distribution from Pallancata in early April of
2012.

Other notable highlights include the following news release announcements:
(a) on December 19, 2011, the results of an independent Preliminary
Economic Assessment ('scoping study') for the Company's 100%-owned Converse
project in Nevada and (b) on January 11, 2012, the results of an
independent Feasibility Study for the Inmaculada project in Peru (40% IMZ /
60% Hochschild).

All amounts in this news release are reported in US dollars.

Highlights for the Three-Month Period Ended December 31, 2011:

During the Current Quarter, the Company achieved the following significant
results:

  - Pre-tax income of $12.0 million for the Current Quarter compared to
    $16.6 million for the three months ended December 31, 2010 (the 'Prior
    Year's Quarter'). Income for the Prior Year's Quarter included a
    non-recurring gain of $2.4 million arising from the sale of an 11%
    interest in the Inmaculada property to Hochschild in December 2010.

  - After-tax consolidated net and comprehensive income of $11.1 million
    (or $0.09 per share) compared to consolidated net and comprehensive
    income after tax of $16.6 million (or $0.14 per share) for the Prior
    Year's Quarter.

 
  - Realized net earnings of $13.1 million for the Current Quarter from the
    Company's 40% share of the Pallancata Mine after the deduction of the
    Company's monitoring costs and the amortization of certain
    non-reimbursable costs, compared to $16.3 million for the Prior Year's
    Quarter.

  - Cash and equivalents at December 31, 2011 increased to $95.7 million
    from $51.7 million at December 31, 2010 and $86.1 million at June 30,
    2011.

  - At December 31, 2011 working capital remained robust at $59.8 million
    compared to working capital of $52.4 million at June 30, 2011.

  - Consolidated cash flow from operating activities for the Current
    Quarter was $10.7 million compared to consolidated cash flow from
    operating activities of $20.6 million for the Prior Year's Quarter.
    Cash flow from operating activities is materially affected by the
    timing and amount of cash distributions from the Pallancata Mine for
    any given reporting period.

 
  - Gross royalty revenue received by IMZ from its 3% net smelter return
    royalty from Barrick's Ruby Hill gold mine (the 'Barrick Royalty') was
    $1.3 million for the Current Quarter (net royalty income was $0.8
    million). These figures compare to gross royalty revenue of $1.2
    million and net royalty income of $1.0 million for the Prior Year's
    Quarter.

  - The Pallancata Mine (on a 100% project basis) produced approximately
    2.3 million ounces of silver and 8,304 ounces of gold in the Current
    Quarter, compared to 2.8 million ounces of silver and 10,045 ounces of
    gold in the Prior Year's Quarter.

  - The Company's 40% share of production from the Pallancata Mine in the
    Current Quarter was approximately 916,000 ounces of silver and 3,322
    ounces of gold compared to 1.1 million ounces of silver and 4,018
    ounces of gold for the Prior Year's Quarter. The decrease in gold and
    silver production for the Current Quarter compared to the Prior Year's
    Quarter was due to a decrease in the grade of both silver and gold
    processed, due primarily to the fact that the higher metal prices
    prevailing during the Current Quarter allowed lower grade material to
    be mined profitably.

 
  - Direct site costs for the Current Quarter at the Pallancata Mine were
    approximately $2.35 per ounce silver produced (after gold by-product
    credits) and total cash costs (as defined by the Gold Institute) were
    $6.26 per ounce silver (after gold by-product credits). For the Prior
    Year's Quarter, direct site costs and total cash costs were lower at
    $1.05 and $4.89 per ounce silver, respectively.

  - Direct site and total cash costs were higher in the Current Quarter
    compared to the Prior Year's Quarter because of lower metal production,
    inflationary cost pressures and an unfavorable appreciation of the
    Peruvian Sol against the US dollar for mine-related site costs.

Other Financial Information for the Three-month Period Ended December 31,
2011:

  - Other expenses totaled $1.7 million for the Current Quarter compared to
    $1.9 million for the Prior Year's Quarter. The decrease in costs in the
    Current Quarter are mostly due to lower interest and financing costs
    related to the convertible debentures, as there is no remaining
    amortization of the deferred financing costs on the debentures because
    of their maturity in May 2012. The only significant increase in
    spending compared to the Prior Year's Quarter was a $206,000 increase
    in professional fees, primarily incurred during the adoption of
    International Financial Reporting Standards (IFRS).

  - Other items represented a reduction in income of $0.3 million for the
    Current Quarter compared to net other income of $1.3 million for the
    Prior Year's Quarter. As previously discussed, other income for the
    quarter ended December 31, 2010 included a $2.4 million gain from the
    sale of an 11% interest in Inmaculada to Hochschild.

  - In the Current Quarter, the Company recognized a withholding tax
    expense of $820,000, which was the Peruvian withholding tax (4.1%) on a
    cash dividend received by IMZ from its Peruvian subsidiary.

  - At December 31, 2011, the Company's total deferred income tax liability
    was $8.0 million, which represents the deferred tax liability recorded
    on the January 2010 acquisition of Metallic Ventures. This tax
    liability is expected to be a non-cash item and will be amortized at
    such time as operations commence at the Goldfield or Converse
    properties or it will be expensed if they are both sold or abandoned.

The Company accounts for its 40% interest in Suyamarca (which owns and
operates the Pallancata Mine and the Inmaculada development property) on an
equity accounting basis.

Financial Results for the Six-Month Period Ended December 31, 2011:

  - The Company reported pre-tax income of $27.2 million for the six-month
    period ended December 31, 2011 (the 'Current Six Month Period')
    compared to pre-tax income of $25.2 million for the six-month period
    ended December 31, 2010 (the 'Previous Six Month Period').

  - Consolidated net and comprehensive income after tax for the Current Six
    Month Period was $26.3 million ($0.22 per share) compared to $25.2
    million in consolidated net and comprehensive income ($0.22 per share)
    for the Previous Six Month Period and the increase was primarily due to
    increased equity income from the Pallancata Mine.

  - Consolidated cash flow from operating activities for the Current Six
    Month Period was $30.4 million compared to $22.1 million for the
    Previous Six Month Period, with the increase due to an increase in cash
    distributions from the Pallancata Mine.

  - Net equity income from the Pallancata Mine for the Current Six Month
    Period was $27.9 million compared to $25.2 million for the Previous Six
    Month Period. This increase was largely a function of higher metal
    prices offset by lower metal production and sales.

  - Net royalty income from the Barrick Royalty for the Current Six Month
    Period was $1.5 million compared to net royalty income of $1.6 million
    for the Previous Six Month Period.

Operating Statistics for the Pallancata Mine (100% Project Basis). 

The table below reports key operating and cost statistics for the
Pallancata Mine for the fiscal quarters ended December 31, 2011 and 2010,
respectively and for the calendar years ended December 31, 2011 and 2010,
respectively, together with the results for the quarter ended September 30,
2011.

              Quarter      Quarter      Quarter      Year        Year
              Ended
12/    Ended
12/    Ended
09/    Ended
12/   Ended
12/
              31/2011      31/2010      30/2011      31/2011     31/2010
Ore mined        291,607      304,277      269,273   1,039,674   1,090,948
(mt)
Ore processed    293,060      281,035      268,673   1,070,467   1,071,617
(mt)
Head grade-          293          358          313         301         344
Ag (g/t)
Head grade-Au       1.27         1.50         1.43        1.33        1.40
(g/t)
Concentrate        2,363        2,283        2,266       8,608       9,541
produced
(mt)
Silver         2,288,930    2,762,725    2,290,805   8,767,394   10,135,483
production
(oz)
Gold               8,304       10,045        9,370      33,881      35,849
production
(oz)
Silver Sold    2,636,200    2,548,700    1,935,300   9,063,800   9,998,000
( ozs)
Gold sold          9,315        8,333        8,017      33,900      32,600
(ozs)
IMZ direct          2.35         1.05         1.01        2.20         222
site costs
(US$)
IMZ  total          6.26         4.89         5.44        6.38        5.47
cash costs
(US$)




Notes:
1. The reported head grades for silver and gold are based on the overall
metallurgical balance for the process plant.
2. The difference between 'produced' metal ounces and 'sold' metal ounces
is in-process concentrate. Silver sales have been rounded.
3. Silver and gold ounces sold are reported as gross ounces. 
4. Direct site costs per ounce silver and total cash costs per ounce silver
reflect a 'mined ore inventory adjustment'. IMZ believes that this
calculation more accurately matches costs with ounces of production (Also
see notes 4 and 5 below).
5. Direct site costs per ounce silver comprise direct mining costs, mined
ore inventory adjustment, toll processing costs and mine general and
administrative costs. The cost per ounce is net of gold by-product credits.
6. Total cash costs, using the Gold Institute definition, comprise: mine
operating costs, mined ore inventory adjustment, toll processing costs,
mine general and administrative costs, Hochschild management fee,
concentrate transportation and smelting costs, local and regional taxes and
the government royalty. The costs per ounce are net of gold by-product
credits.

Company Outlook

During the 2012 fiscal and calendar years, the Company's exploration and
development efforts are focused on:

  - At the Pallancata silver mine in Peru: 

  - Working with Hochschild to continue production at the 3,000 tpd mining
    rate to produce approximately 8.0 million ounces of silver and 34,000
    ounces of gold in calendar year 2012 (the Company's estimate on a 100%
    project basis).

 
  - Increasing mineral resources and reserves to extend the existing mine
    life (approximately a 4 years based on current reserves).

  - At the Inmaculada gold-silver project in Peru:

  - Working with Hochschild to continue with mine development and
    construction with production targeted to commence prior to the end of
    calendar year 2013.

  - Continuing with an aggressive exploration program in order to expand
    reserves and resources.

  - At the Goldfield gold project in Nevada, to complete a feasibility
    study in the summer of 2012, with the goal of potential production in
    calendar 2015.

  - At the Converse gold project in Nevada, to commence a feasibility study
    in the summer of 2012.

  - At the Rio Blanco gold-silver project in Ecuador, to conclude
    discussions with the Ecuadorian government with respect to the
    negotiation of a production contract, which will include quantification
    of certain tax and royalty issues related to the 2009 Mining Law.

  - Also subject to clarification of the mining law issues mentioned above,
    to advance the Gaby gold project with the commencement of a feasibility
    study before the end of the calendar year.

  - Enhancing cash flow by acquiring a producing asset or assets in a
    low-risk political and environmental jurisdiction in the Americas.

  - Continuing to seek additional strategic joint venture alliances, such
    as that with Hochschild at Pallancata and Inmaculada, in order to
    fast-track projects to production and to reduce future cash outlays by
    the Company.

Hochschild Mining plc does not accept any responsibility for the adequacy
or inadequacy of the disclosure made in this news release and any such
responsibility is hereby disclaimed in all respects.



For additional information, contact:

In North America
Paul Durham, VP Corporate Relations                         
Tel: +1 480 483 9932  

In Europe
Oliver Holzer, Markeing Consultant 
Tel: +41 44 853 00 47

Or email us at: IR@intlminerals.com                              
Internet Site: http://www.intlminerals.com 

To view the Company's financial statements and MD&A, please click the
following link:
http://www.intlminerals.com/financialreports.php

Cautionary Statement:

The Gold Institute calculation of Direct Site Costs and Total Cash Costs
are non-IFRS financial measures, which Company management believes are
useful in measuring operational performance. Some of the statements
contained in this release are 'forward-looking statements' within the
meaning of Canadian securities law requirements. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause our actual results, performance or achievements to differ
materially from the anticipated results, performance or achievements
expressed or implied by such forward-looking statements. Forward-looking
statements in this release include statements regarding production
expectations, drilling and development programs on the Company's projects,
timing of completion of economic studies and the timing of commencement of
construction and production and, obtaining of required environmental and
production permits. Factors that could cause actual results to differ
materially from anticipated results include risks and uncertainties such
as: risks relating to obtaining mining and environmental  permits; mining
and development risks; financing risks; risk of commodity price
fluctuations; political and regulatory risks; risks related to the new
mining law in Ecuador, and other risks and uncertainties detailed in the
Company's Annual Information Form for the year ended June 30, 2011, which
is available at www.sedar.com under the Company's name. The Company
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.





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Language:               English
Company:                International Minerals Corp.
                        7950 East Acoma Street
                        AZ 85260 Scottdale
                        United States
Phone:                  001 480 483 9932
Fax:                    001 480 483 9926
E-mail:                 IR@intlminerals.com
Internet:               www.intlminerals.com
ISIN:                   CA4598751002
Swiss Security Number:  893760
Listed:                 Freiverkehr in Berlin, München; Open Market in
                        Frankfurt; Toronto, SIX
 
End of Announcement                             EquityStory News-Service
 
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