Quantcast

Revett Minerals Reports Operating and Financial Results for the Three and Six Months Ended June 30, 2008

August 13, 2008

SPOKANE VALLEY, WA, Aug. 13 /PRNewswire-FirstCall/ — Revett Minerals Inc., (TSX-RVM) (“Revett” or the “Company”) is pleased to report on its operating and financial performance for the three and six months ended June 30, 2008. All currency in this report is in United States dollars unless otherwise indicated

The major highlights for the three and six months ended June 30, 2008 include the following:

   - Troy has now operated for 12 consecutive months without a lost time     incident;   - Troy (100% basis) attained mill throughput averaging 3,645 tons per day     for the three months ended June 30, 2008 ( and 3,489 tons per day for     the first six month period in 2008) compared to 3,711 tons per day     during the three months ended June 30, 2007 ( and 3,801 tons per day     for the six month period ended June 30, 2007);   - Troy (100% basis) generated over $5.2 million in cash for the three     months ended June 30, 2008 bringing its year to date cash flow to over     $3.6 million;   - Troy (100% basis) generated net earnings before taxes of $3.4 million     for the second quarter of 2008 and $6.6 million for the six month     period ended June 30, 2008;   - Troy (100% basis) produced 2.4 million pounds of copper and     259,847 ounces of silver in concentrate during the second quarter of     2008 compared to 3.5 million pounds of copper and 372,332 ounces of     silver for the three months ended June 30, 2007;   - For the six month period ended June 30, 2008, Troy produced     4.5 million pounds of copper and 491,759 ounces of silver in     concentrate compared to production of 6.8 million pounds of copper and     731,466 ounces of silver in concentrate for the comparable six month     period in 2007;   - The Troy Mine has entered into a contractual agreement with Small Mine     Development LLC ("SMD") whereby SMD will provide contract mining     services to assist in development of the "C-Beds" and also assist in     the on-going mining and development in the East Ore Body;   - For the three months ended June 30, 2008, the Company reported net     income of $0.1 million ($0.00 per share) compared to $3.7 million     ($0.05 per share for the second quarter of 2007;   - In-spite of improving production of copper and silver, second quarter     earnings were negatively impacted by the Company being required to fair     value concentrate sales for which final settlement had not yet     occurred, a large tax expense for the quarter and significant legal     expenses relating to the Rock Creek permit challenges; and   - The Company reported net income of $1.5 million or $0.02 per share for     the six months ended June 30, 2008 compared to net income of     $4.0 million ($0.06 per share) for the six months ended June 30, 2007.   

Bill Orchow, President and CEO of the Company, in commenting on the results for the second quarter of 2008 said “We continue to be pleased with the strong earnings and cash generation that was achieved by Troy over the past three months coupled with a continuing excellent environmental record and an excellent safety record by all employees. Troy has not had a lost time incident for over a year”.

   CONSOLIDATED RESULTS   --------------------   

For the three months ended June 30, 2008, Revett reported net income of $0.1 million or $0.00 per share on revenue of $13.4 million. This compared to net income of $3.7 million or $0.05 per share during the three months ended June 30, 2007 on revenues of $15.9 million. Net income for the second quarter of 2008 was negatively effected by three significant factors; (i) in the second quarter, revenues were reduced by $2.0 million due to the accounting requirement whereby the Company is required to mark to market accounts receivable and forward contracts for which final settlement has not yet occurred; (ii) approximately $0.5 million of legal expenses relating to Rock Creek; and (iii) a large tax adjustment because management changed its estimate of the amount of exploration spending at Rock Creek which significantly increased the income tax expense for the three and six months ended June 30, 2008.

Concentrate deliveries and sales during the three months ended June 30, 2008 consisted of 2.4 million pounds of payable copper and 244,630 ounces of payable silver compared to 3.5 million pounds of copper and 378,226 ounces of silver during the three months ended June 30, 2007.

During the second quarter of 2008, cost of sales was $9.5 million compared to $8.8 million in the second quarter of 2007. Operating costs were higher reflecting higher labor costs, higher materials and supplies (principally in the drill and blast activities), and higher property and state mining taxes. Depreciation and amortization in this current quarter was $0.5ӚÓš million compared to $0.4 million in the second quarter of 2007. The reclamation and remediation liability accretion expense was $0.1 million in the second quarter of 2008 and $0.2 million in the second quarter of 2007.

Exploration and development costs totaled $1.0 million in the second quarter of 2008, compared to $0.6 million in the second quarter of 2007. The large increase in exploration and development was largely a function of increased legal costs relating to the Rock Creek permit challenges. With all court filings now complete these expenses should be less in future periods. General and administration costs were $1.4 million in the second quarter of 2008 compared to $1.1 million during the second quarter of 2007. Other income during the second quarter was $0.1 million compared to $0.9 million recorded during the second quarter of 2007, reflecting lower foreign exchange gains on cash and short term investment held in Canadian dollars.

As a result of the foregoing factors, net income before non controlling interest and taxes was $1.0 million for the second quarter of 2008 and $5.8 million for the second quarter of 2007. For the three months ended June 30, 2008, net income, after taxes and non controlling interests, was $0.1 million or $0.00 per share compared to net income of $3.7 million or $0.05 per share for the three month period ended June 30, 2007.

The only remaining third party debt obligations of the Company are the capped Royal Gold production driven royalty expected to be retired within the next nine months depending on production levels and metal prices and $1.6 million in principal payments relating to certain capital lease obligations. At June 30, 2008, the Company’s cash and cash equivalents and short term investments, which consists of cash invested in fixed income securities, totaled $13.1 million compared to $9.5 million as at March 31, 2008. At June 30, 2008 working capital had increased to $12.5 million from $11.6 million at March 31, 2008.

   THE TROY MINE   -------------   

The table below illustrates certain key operating statistics for Troy (100% basis) for the three and six months ended June 30, 2008, with a comparison to the three and six months ended June 30, 2007.

                    Three Months  Three Months    Six Months    Six Months                    ------------  ------------    ----------    ----------                           Ended         Ended         Ended         Ended                           -----         -----         -----         -----                         June 30,      June 30,      June 30,      June 30,                         -------       -------       -------       -------                            2008          2007          2008          2007                            ----          ----          ----          ----   Tons milled           331,698       337,712       631,561       687,892   Tons milled per day     3,645         3,711         3,489         3,801   Operating cost per    ton milled (USD)       26.96         22.04         26.67         21.90   Copper grade (pct)       0.41          0.59          0.41          0.56   Silver grade (opt)       0.87          1.24          0.87          1.19   Copper recovery    (pct)                   87.9          87.1          87.2          87.1   Silver recovery    (pct)                   90.1          88.5          89.6          88.7   Copper produced    (lbs)              2,388,947     3,490,930     4,518,469     6,793,282   Silver produced    (ozs)                259,847       372,332       491,759       731,466   Copper sold    (payable pounds)   2,391,086     3,544,216     4,409,060     6,276,480   Silver sold    (payable ozs)        244,630       378,226       447,393       668,073   

The continuing improvement in mill throughput, combined with the continued high prices for silver and copper are the two most significant factors affecting the Company’s second quarter operating and financial results. Production levels in the second quarter of 2008 improved by 10.6% over the first quarter of 2008, but lower than planned ore grades continue to affect the amount of payable metal produced. Since January 2008, the mine has operated for significant periods of time in the fringes of the ore body because metal prices have allowed for economic production from lower grade material and, additionally the mine remains behind in its development as it continues to recovery from restrictions placed on it by MSHA (relating to the July 30, 2007 rock fall) during the second half of 2007. Ore grades, however, remained below average life of mine grades but a modest improvement in grades is anticipated throughout the rest of the year. If production can continue at levels experienced in the second quarter and prices remain at or near current levels, Troy could generate positive cash flow during the rest of this year. Also, the mine continues to work aggressively in implementing its safety and environmental programs and this performance has been excellent for the past twelve months.

   ROCK CREEK UPDATE   -----------------   

All required legal briefs have been filed with the court respecting the challenges brought by certain environmental groups concerning the Rock Creek permit. Meanwhile, in accordance with our permits, the Company has completed construction of the office and core shed at the Rock Creek property.

   ABOUT REVETT   ------------   

Revett, through its subsidiaries, owns both the Rock Creek Project and the Troy Mine both of which are located in northwest Montana. Based on the drilling to date, Rock Creek contains an estimated inferred resource of 137 million tons grading 1.67 ounces silver per ton and 0.72% copper, containing approximately 229 million ounces of silver and over 2 billion pounds of copper using a cut off grade of US $10.00 per ton. Further information on both the Troy Mine and the Rock Creek Project may be found in the National Instrument 43-101 reports at http://www.sedar.com/. These reports were prepared on behalf of the Company by Mr. Jean-Francois Couture, P.Geo. and Mr. Ken Reipas, P.Eng. of SRK Consulting (Canada). Both Mr. Couture and Mr. Reipas are Qualified Persons in accordance with National Instrument 43-101. All of these issues are discussed in greater detail in the Company’s official filings at http://www.sedar.com/ and with the SEC on EDGAR.

   William Orchow   President & CEO   

Except for the statements of historical fact contained herein, the information presented in this press release may contain “forward-looking statements” within the meaning of applicable Canadian securities legislation and The Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including but not limited to those with respect to the price of silver and copper, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the effect on the Company’s operations of pending or planned legal challenges, the timing and amount of estimated future production, industrial accidents, and costs of production, all involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Generally, these forward looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects”, or “does not expect”, “is expected”, “is not expected”, “budget”, “plans”, “schedule”, “estimates”, “forecasts”, “intends”, “anticipates”, “or does not anticipate” or “believes” or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward looking statements are subject to known and known risks, uncertainties and other factors. Such other factors may include, among others, ground control problems and flooding, metallurgical recovery problems, ore grade or tonnage shortfalls, labor disruptions or shortages of skilled labor, risks relating to environmental laws and regulations, the actual results of exploration activities, actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future metal prices, changes in the quantity and costs of producing copper concentrate as well as those factors discussed in the section entitled “Risk Factors” in the annual Form 10-Kfiled on SEDAR at http://www.sedar.com/ and with the SEC on EDGAR. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Revett Minerals does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.

   Revett Minerals Inc.   Consolidated Balance Sheets   at June 30, 2008 and December 31, 2007   (expressed in thousands of United States dollars)   (unaudited)                                                June 30, 2008   December 31,                                                  (unaudited)         2007                                 Assets    Current Assets    Cash and cash equivalents                      $   13,106     $  14,055   Short term investments                                  -         3,955   Accounts receivable                                 3,941           970   Income taxes receivable                                50         1,250   Inventories                                         4,767         4,519   Prepaid expenses and deposits                         601           498                                                 ---------------------------     Total current assets                             22,465        25,247    Mineral property, plant, equipment and    mine development (net)                            60,364        60,714   Restricted cash                                     7,538         7,386   Other long term assets                              1,197         1,264                                                 ---------------------------     Total assets                                 $   91,564     $  94,611                                                 ---------------------------                                                 ---------------------------             Liabilities and shareholders equity    Current liabilities    Trade accounts payable                         $    2,347     $   1,985   Payroll liabilities                                 1,062           806   Income, property and mining taxes                   1,698         1,161   Concentrate settlement payable                        416           526   Other accrued liabilities                           1,438           852   Current portion of long term debt                   3,025         9,719                                                 ---------------------------     Total current liabilities                         9,986        15,049    Long-term portion of debt                             597         1,784   Reclamation and remediation liability               7,231         7,141   Future income taxes                                 8,450         8,391                                                 ---------------------------     Total liabilities                                26,264        32,365                                                 ---------------------------   Non controlling interest                            9,072         8,175                                                 ---------------------------                       Shareholders' equity    Preferred stock, no par value, unlimited    authorized, nil issued and outstanding   Common stock, no par value unlimited    authorized, 75,002,702    (2007- 74,295,702) shares issued and    outstanding                                       56,871        56,315   Contributed surplus                                 1,675         1,556   Deficit                                            (2,318)       (3,800)                                                 ---------------------------                                                      56,228        54,071                                                 ---------------------------      Total liabilities and shareholders equity   $   91,564     $  94,611                                                 ---------------------------                                                 ---------------------------     Revett Minerals Inc.   Consolidated Statements of Operations and Comprehensive income   Three and six months ended June 30, 2008 and 2007   (expressed in thousands of United States dollars except share and per    share amounts)   (unaudited)                     Three month   Three month     Six month     Six month                    period ended  period ended  period ended  period ended                         June 30,      June 30,      June 30,      June 30,                            2008          2007          2008          2007    Revenues           $   13,377    $   15,903    $   25,411    $   26,619    Expenses:   Cost of sales           9,515         8,758        17,793        16,307   Depreciation and    amortization             454           449           846           835   Exploration and    development              958           625         1,310         1,100   General and    administrative         1,389         1,064         2,375         2,039   Accretion of    reclamation and    remediation    liability                148           162           295           323                     -------------------------------------------------------                          12,464        11,058        22,619        20,604                     -------------------------------------------------------     Income from      operations             913         4,845         2,792         6,015   Other income    (expenses):   Interest expense         (270)         (372)         (544)         (744)   Interest and other    income                   362           465           617           692   Foreign exchange    gain (loss)               35           838          (183)          966                     -------------------------------------------------------     Total other      income      (expenses)             127           931          (110)          914                     -------------------------------------------------------   Net income before    non controlling    interest    and taxes              1,040         5,776         2,682         6,929   Income tax    expense                  496           953            71         1,329                     -------------------------------------------------------   Net income before    non controlling    interest                 544         4,823         2,611         5,600   Non controlling    interest                 469         1,096         1,129         1,571                     -------------------------------------------------------   Net income and    comprehensive    income for    the period        $       75    $    3,727    $    1,482    $    4,029                     -------------------------------------------------------                     -------------------------------------------------------   Basic earnings    per share         $     0.00    $     0.05    $     0.02    $     0.06                     -------------------------------------------------------                     -------------------------------------------------------   Diluted earnings    per share         $     0.00    $     0.05    $     0.02    $     0.06                     -------------------------------------------------------                     -------------------------------------------------------   Weighed average    number of shares    outstanding       75,002,702    72,863,666    74,882,279    72,863,666                     -------------------------------------------------------                     -------------------------------------------------------   Weighted average    number of    diluted shares    outstanding       75,028,702    73,585,032    74,908,279    73,250,995                     -------------------------------------------------------                     -------------------------------------------------------     Revett Minerals Inc.   Consolidated Statements of Cash Flow   Three and six months ended June 30, 2008 and 2007   (expressed in thousands of United States dollars)   (unaudited)                      Three month   Three month     Six month     Six month                    period ended  period ended  period ended  period ended                         June 30,      June 30,      June 30,      June 30,                            2008          2007          2008          2007   Cash flows    from operating    activities:    Net income    for the period    $       75    $    3,727    $    1,482    $   4,029   Adjustments to    reconcile net    income to net    cash provided    by operating    activities     Depreciation      and      amortization           454           449           846          835     Accretion of      reclamation      and      remediation      liability              148           162           295          323     Foreign exchange      loss (gain)            (35)         (838)          183         (966)     Stock based      compensation            39           154           119          497     Loss (gain)      on disposal      of fixed assets         (7)            1            67            1     Future income      tax expense      (recovery)             475           953          (147)       1,329     Non controlling      interest               469         1,096         1,129        1,571     Accrued interest      from reclamation      trust fund             (67)          (85)         (153)        (168)     Amortization of      prepaid      insurance premium       36            39            68           80     Change in fair      value of      derivative      contracts            2,142        (1,466)          109        1,641   Changes in:     Accounts receivable     (82)       (3,838)       (3,080)      (5,113)     Income taxes      receivable               -             -         1,250            -     Inventory               (65)          605          (247)        (253)     Prepaid expenses      and other              (88)          126          (153)        (270)     Accounts payable      and accrued      liabilities          1,229         5,187         1,631        1,061                     -------------------------------------------------------   Net cash    generated by    operating    activities             4,723         6,272         3,399        4,597                     -------------------------------------------------------   Cash flows    from investing    activities:      Proceeds      (purchase)      of short term      investments          1,002        (1,465)        3,955       (1,944)     Other long term      assets                   3           541             -          583     Purchase of plant      and equipment         (149)       (2,450)         (155)      (2,708)                     -------------------------------------------------------   Net cash provided    (used) by    investing    activities               856        (3,374)        3,800       (4,069)                     -------------------------------------------------------    Cash flows from    financing    activities:      Proceeds form      the issuance      of common      stock, net               -             -             -        1,327     Proceeds from long      term debt                -         1,838             -        1,839     Repayment of debt      (763)       (1,602)       (7,388)      (2,342)     Repayment of      capital leases        (282)         (244)         (577)        (425)                     -------------------------------------------------------   Net cash from    (used by)    financing    activities            (1,045)           (8)       (7,965)         399                     -------------------------------------------------------   Effects of    foreign    exchange    on cash held    In foreign    currencies                35           838          (183)         966                     -------------------------------------------------------   Net increase    (decrease)    in cash and    cash    equivalents            4,569         3,728          (949)       1,893     Cash and cash      equivalents,      beginning of      period               8,537        18,027        14,055       19,862                     -------------------------------------------------------     Cash and cash      equivalents,      end of      period          $   13,106    $   21,755    $   13,106    $  21,755                     -------------------------------------------------------                     -------------------------------------------------------   Supplementary    cash flow    information:     Cash paid      for interest      expense         $      148    $      242    $      552    $     787     Common stock      issued to      acquire non-      controlling      interest        $        -    $        -    $      556    $       -     Acquisition      of plant and      equipment under      capital lease      business      acquisition     $        -    $        -    $       84    $       -     Revett Minerals Inc.   Consolidated Statement of Shareholders' Equity   Six months ended June 30, 2008 and 2007   (expressed in thousands of United States dollars)   (unaudited)                               Common shares    Contri-                    -----------------------     buted                          Shares     Amount   surplus   Deficit      Total   -------------------------------------------------------------------------    Balance, December    31, 2006          71,904,088 $   53,989 $     816 $  (4,673) $  50,132   Issued for    cash on    the exercise    of share    purchase    warrants           1,293,615      1,327         -         -      1,327   Stock-based    compensation    on options    granted                    -          -       496         -        496   Net income for    the year                   -          -         -     4,029      4,029                    --------------------------------------------------------   Balance, June    30, 2007          73,197,703 $   55,316 $   1,312 $    (644) $  55,984                    --------------------------------------------------------                    --------------------------------------------------------    Balance, December    31, 2007          74,295,702 $   56,315 $   1,556 $  (3,800) $  54,071   Issued to acquire    non controlling    interest             707,000        556         -         -        556   Issued for cash    on the exercise    of share purchase    warrants                   -          -         -         -          -   Stock-based    compensation on    options granted            -          -       119         -        119   Net income for the    period                     -          -         -     1,482      1,482                    --------------------------------------------------------   Balance, June    30, 2008          75,002,702 $   56,871 $   1,675 $  (2,318) $  56,228                    --------------------------------------------------------                    --------------------------------------------------------  

REVETT MINERALS INC

CONTACT: Scott Brunsdon, CFO or Doug Ward, VP Corporate Development,(509) 921-2294 or visit our website at http://www.revettminerals.com/; RenmarkFinancial Communications Inc.: Jason Roy: jroy@renmarkfinancial.com; MauriceDagenais: mdagenais@renmarkfinancial.com, (514) 939-3989, Fax: (514) 939-3717;http://www.renmarkfinancial.com/




comments powered by Disqus