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International Minerals Realizes $4.12 Million ($0.04 Per Share) in Net Income for Third Quarter

Posted on: Tuesday, 20 May 2008, 09:00 CDT

International Minerals Corporation (TSX: IMZ) (SWX: IMZ) (FRANKFURT: MIW) ("IMZ" or "the Company") reported $4.12 million in net income, including $3.66 million in equity earnings from its 40%-owned Pallancata silver-gold mine in Peru for the fiscal third quarter ending March 31, 2008. IMZ's joint venture partner at Pallancata, Hochschild Mining PLC ("Hochschild"), is the mine operator and holds a 60% interest in the project.

For the nine month period ended March 31, 2008, IMZ reported a loss of $0.77 million, partially offset by an equity earnings of $2.87 million from its 40% interest in the Pallancata Mine.

The Pallancata joint venture company, Minera Suyamarca S.A.C., has not yet distributed any cash dividends to the joint venture partners from the Pallancata Mine, but such dividends are expected to be paid by the end of June 2008.

During the 3-month period ended March 31, 2008, IMZ achieved the following significant accomplishments (all amounts reported in US$):

 --  Completed the quarter with $67.1 million in cash and equivalents,     aggregate working capital of $65.5 million and total assets of $155.0     million.      --  Generated net income of $4.12 million, primarily comprised of: equity     earnings from IMZ's 40% interest in the Pallancata Mine; a non-cash foreign     exchange gain; and interest income. IMZ accounts for its interest in     Pallancata on an equity accounting basis.      --  Realized production at the Pallancata Mine of 50,893 tonnes producing     approximately 500,000 ounces of silver and 1,930 ounces of gold on a 100%     basis, with the Company's 40% share of production being approximately     200,000 ounces of silver and 770 ounces of gold.      --  Realized fiscal year-to-date production at the Pallancata Mine of     129,228 tonnes of ore recovering 1,204,000 ounces of silver and 4,690     ounces of gold on a 100% basis, with the Company's 40% share being 481,600     ounces of silver and 1,876 ounces of gold since start up in September 2007.      --  Announced updated proven and probable reserves at the Pallancata Mine     of 3.5 million tonnes at an average grade of 289 grams per tonne ("g/t")     silver and 1.2 g/t gold containing a total of 32.9 million ounces of silver     and 142,000 ounces of gold on a 100% basis. See news release dated March     17, 2008 for details.  This updated reserve estimate represents a 187%     increase from the previously-released reserve estimates. An updated     National Instrument (NI) 43-101 technical report is pending.      --  Expended $4.7 million in resource property activities mainly in     preliminary feasibility study drilling, metallurgy and field work for the     Gaby gold property in Ecuador; for detailed engineering, metallurgy, field     work and development costs for the Rio Blanco gold-silver project in     Ecuador; and for exploration field work on the Urbaque project (adjacent to     Pallancata) in Peru.      --  Continued working on an updated capital and operating cost estimate     for the Rio Blanco project in Ecuador, which is expected to be completed by     June 30, 2008.      --  Announced an estimated 308.4 million tonnes at an average grade of     0.63 g/t gold containing 6.2 million ounces of measured and indicated gold     resources at the Gaby gold property in Ecuador (the first NI 43-101     compliant mineral resource estimate). See news release dated February 11,     2008 for details. The Company also announced the results of a preliminary     feasibility study for the Gaby project, which was not positive at a base     case gold price of $650/oz gold. Optimization studies using higher     production tonnages are ongoing at Gaby to evaluate the economy of scale     effects on the overall project economics. This study is expected to be     completed by the end of September 2008.      --  Received assay results from an additional 38 core drill holes totaling     10,927 meters ("m") at the Main Gaby deposit at Gaby, including a drill     intersection of 205m grading 1.3 g/t gold and 202m at 0.8 g/t gold.  These     new drill results were not included in the measured and indicated resource     estimate described above.      

Quarterly production statistics, as reported by Hochschild, for the Pallancata Mine (100% basis) are summarized below for the last two calendar quarters:

                                                    Q1 2008     Q4 2007                                      ----------   ---------   --------- Ore production                       (tonnes)        50,893      63,612 Average head grade silver            (g/t)           340.10      322.64 Average head grade gold              (g/t)             1.61        1.54 Concentrate produced                 (tonnes)           541         560 Silver grade in concentrate          (kg/t)           28.71       33.25 Gold grade in concentrate            (kg/t)            0.11        0.13 Silver produced                      (,000 ozs)         500         599 Gold produced                        (,000 ozs)        1.93        2.33 Silver sold                          (,000 ozs)         391         550 Gold sold                            (,000 ozs)        1.44        2.03                                      ----------   ---------   --------- 

Subsequent to the end of the quarter, on April 18, 2008, the National Constituent Assembly in Ecuador approved a new mining mandate, pending the issuance of a revised mining law. The Company is analyzing the impact of the mandate on its Rio Blanco project (currently in the permitting process) and the Gaby project (currently in the preliminary feasibility stage of development). Until the Company understands the full impact of the mining mandate, all drilling and the majority of on-site exploration activities at the Ecuador projects have been suspended. Critical technical studies, however, are continuing at both Rio Blanco and Gaby. As far as the Company is aware, all of its concessions remain in good standing, however, the effects of the mining mandate have not yet been clarified.

     For additional information, contact Wendy Yang Tel: (303) 357-4863                 Internet Site: http://www.intlminerals.com 

Cautionary Statement:

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 drilling and development programs on the Company's projects, timing of commencement of production, completion of feasibility studies, obtaining of required environmental and production permits, and timing and significance of future cash flows from operations. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties such as: risks relating to estimates of mineral resources and reserve; risks relating to project capital and production costs; risks relating to obtaining mining and environmental permits; mining and development risks; risk of commodity price fluctuations; political and regulatory risks; and other risks and uncertainties detailed in the Company's Renewal Annual Information Form for the year ended June 30, 2007, 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.

 INTERNATIONAL MINERALS CORPORATION CONSOLIDATED BALANCE SHEETS (Expressed in United States Dollars) (Unaudited) ASSETS                                          3/31/2008      6/30/2007                                               -------------  ------------- Current   Cash and equivalents                        $  67,130,569  $  29,889,675   Short term investments                                  -     54,552,630   Receivables                                     1,189,679        116,654   Due from related parties                           50,017              -   Prepaid expenses and deposits                      16,107          6,007   Securities held for trade                         299,350        103,252                                               -------------  -------------                                                  68,685,722     84,668,218   Property and equipment                            342,044        342,308   Investments                                     1,243,708         15,000   Investment in joint venture                    10,303,303      6,270,221   Resource properties                            73,273,234     57,982,008   Environmental bond                                 54,819        136,418   Deferred finance costs                          1,074,040      1,332,448                                               -------------  -------------                                               $ 154,976,870  $ 150,746,621                                               =============  ============= LIABILITIES AND SHAREHOLDERS' EQUITY Current   Accounts payable and accrued liabilities    $   2,483,442  $   3,375,236   Accrued interest payable on convertible    debentures                                       716,705        173,070   Due to related parties                                  -          5,932                                               -------------  -------------                                                   3,200,147      3,554,238                                               -------------  ------------- Long term   Convertible debentures                         35,429,840     33,507,969                                               -------------  -------------                                                  35,429,840     37,062,207                                               -------------  ------------- Shareholders' equity   Capital stock                                 128,748,151    126,117,325   Contributed surplus                             4,458,384      3,655,503   Equity component of convertible debentures      4,945,008      4,945,008   Deficit                                       (21,804,660)   (21,033,422)                                               -------------  -------------                                                 116,346,883    113,684,414                                               -------------  -------------                                               $ 154,976,870  $ 150,746,621                                               =============  ============= INTERNATIONAL MINERALS CORPORATION CONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT (Expressed in United States Dollars) (Unaudited)                    3-Month        3-Month        9-Month        9-Month                 Period Ended   Period Ended   Period Ended   Period Ended EXPENSES           3/31/08        3/31/07        3/31/08        3/31/07                 -------------  -------------  -------------  -------------   Amortization  $       4,935  $       8,619  $      16,602  $      22,832   General    exploration            888              -         16,282              -   Investor    relations          109,596        164,359        327,432        223,986   Office and    general             68,842         54,045        147,431        141,110   Professional    fees               311,105          6,730        461,768        168,002   Salaries and    benefits           187,172        148,000        602,306        342,078   Salary    charge-outs        (39,915)       (31,673)      (113,238)       (71,809)   Stock-based    compensation       127,831      1,086,868      1,737,493      1,301,197   Transfer    agent &    listing fees        59,229         46,138        100,996         85,610   Interest and    financing    costs              897,305        736,856      2,667,508      2,294,965   Travel               25,617          8,138         79,859         31,453   Write-off of    mineral    properties               -              -              -      1,631,420                 -------------  -------------  -------------  -------------                     1,752,605      2,228,080      6,044,439      6,170,844                 -------------  -------------  -------------  ------------- OTHER ITEMS   Foreign    exchange    (loss) gain  $   1,564,264  $    (179,596) $    (440,558) $  (1,816,354)   Unrealized    (loss) gain    on securities    held for    trade              (33,117)             -        177,118              -   Gain on sale    of marketable    securities               -      4,568,393              -      4,639,306   Management    fee income          91,538         54,926        283,939        129,982   Interest    income             586,347        545,650      2,385,744      2,131,305   Equity gain    in joint    venture          3,659,400              -      2,866,958              -                 -------------  -------------  -------------  -------------                     5,868,432      4,989,373      5,273,201      5,084,239                 -------------  -------------  -------------  ------------- Net (loss)  income for  the period         4,115,827      2,761,293       (771,238)    (1,086,605) Deficit,  beginning of  period           (25,920,487)   (21,868,338)   (21,033,422)   (18,020,440)                 -------------  -------------  -------------  ------------- Deficit, end  of period      $ (21,804,660) $ (19,107,045) $ (21,804,660) $ (19,107,045)                 =============  =============  =============  ============= Basic and  diluted (loss)  income per  share for  the period     $        0.04  $        0.03  $       (0.01) $       (0.01)                 -------------  -------------  -------------  ------------- Weighted average  number of  common shares  outstanding       95,858,748     94,135,451     95,551,477     92,626,928                 =============  =============  =============  ============= INTERNATIONAL MINERALS CORPORATION CONSOLIDATED STATEMENT OF CASH FLOW (Expressed in United States Dollars) (Unaudited)                       3-Month       3-Month       9-Month       9-Month                     Period Ended  Period Ended  Period Ended  Period Ended                       3/31/2008     3/31/2007     3/31/2008     3/31/2007                     ------------  ------------  ------------  ------------ CASH FLOWS FROM  OPERATING  ACTIVITIES   Net income    (loss) for the    period           $  4,115,827  $  2,761,293  $   (771,238) $ (1,086,605)   Add non-cash    items:   Amortization             4,935         8,619        16,602        22,832   Stock-based    compensation          127,831     1,086,868     1,737,493     1,301,197   Unrealized    foreign exchange    loss (gain)        (1,564,264)      233,083       440,558     1,816,354   Unrealized (gain)    loss on    securities held    for trade              33,117             -      (177,118)            -   Gain on sale of    marketable    securities                  -    (4,568,393)            -    (4,639,306)   Accrued interest    receivable                494       (13,408)       (6,706)      (55,000)   Write-off of    mineral    properties                  -             -             -     1,631,420   Interest and    financing costs       897,305       894,498     1,564,494     1,405,326   Equity gain on    investment in    joint venture      (3,659,400)            -    (2,866,958)            -   Changes in    non-cash working    capital items:   (Increase)    decrease in    receivables           (35,015)       30,580    (1,073,025)       62,425   (Increase)    decrease in    prepaid expense    and deposits              157         3,006       (10,100)        3,288   Increase    (decrease) in    accounts payable    and accrued    liabilities           171,923      (294,632)     (671,868)      (64,845)   Due to / (from)    related parties       (24,563)      (81,794)      (55,949)     (217,104)                     ------------  ------------  ------------  ------------   Net cash    provided by    (used in)    operating    activities             68,347        59,720    (1,873,815)      179,982                     ------------  ------------  ------------  ------------ CASH FLOWS FROM  FINANCING  ACTIVITIES   Proceeds from the    issuance of    capital stock         897,855    12,291,044     1,067,392    12,564,406                     ------------  ------------  ------------  ------------   Net cash provided    by (used in)    financing    activities            897,855    12,291,044     1,067,392    12,564,406                     ------------  ------------  ------------  ------------ CASH FLOWS FROM  INVESTING  ACTIVITIES   Change in    short-term    investments                 -             -    55,046,584             -   Change in    long-term    investments        (1,243,708)            -    (1,243,708)            -   Resource property    expenditures       (4,656,063)   (5,266,545)  (15,820,820)  (12,756,734)   Investments in    joint venture               -        (1,020)            -      (200,289)   Purchase of    property and    equipment             (11,876)            -       (16,338)      (50,854)   Proceeds from the    sale of    marketable    securities                  -     5,947,859             -     6,028,146   Purchase of    marketable    securities                  -             -             -       (94,623)   Environmental    bond                        -             -        81,599        53,391                     ------------  ------------  ------------  ------------   Net cash provided    by (used in)    investing    activities         (5,911,647)      680,294    38,047,317    (7,020,963)                     ------------  ------------  ------------  ------------ Effect of exchange  rate changes on  cash and  equivalents                   -       (98,798)            -    (2,922,383)                     ------------  ------------  ------------  ------------ Change in cash and  equivalents for  the period           (4,945,445)   12,932,260    37,240,894     2,801,042 Cash and  equivalents,  beginning of  period               72,076,014    72,585,920    29,889,675    82,717,138                     ------------  ------------  ------------  ------------ Cash and  equivalents, end  of period          $ 67,130,569  $ 85,518,180  $ 67,130,569  $ 85,518,180                     ============  ============  ============  ============ 

 For additional information, contact: Wendy Yang Tel: (303) 357-4863 Internet Site: http://www.intlminerals.com

SOURCE: International Minerals Corporation

Source: MARKET WIRE

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