Romarco Minerals Inc.
TSX VENTURE : R

Romarco Minerals Inc.

May 29, 2006 14:09 ET

Romarco Announces First Quarter Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 29, 2006) - ROMARCO MINERALS INC. (TSX VENTURE:R) (the "Company") reports its first quarter financial results. All figures are in Canadian dollars unless otherwise noted. Complete quarterly results are available on SEDAR and on the Company's website at www.romarco.com.



Selected Financial Data (unaudited)

Three Months Three Months
Ended Ended
March 31, 2006 March 31, 2005

Net income (loss) $ 1,034,671 $ (306,591)
Income (loss) per share 0.02 (0.01)
- fully diluted 0.01 (0.01)

Cash flows from (used in) operating
activities 1,689,655 (295,350)
Cash flows used in investing
activities (289,176) (99,937)
--------------- ---------------
Increase (decrease) in cash and
cash equivalents $ 1,400,479 $ (395,287)
--------------- ---------------
--------------- ---------------

March 31, December 31,
2006 2005

Current assets:
Cash and cash equivalents $ 2,330,917 $ 930,438
Other 243,807 916,037
--------------- ---------------
Total current assets 2,574,724 1,846,475
Mineral property interests 2,399,510 2,062,334
Equipment 27,873 29,798
--------------- ---------------
Total assets $ 5,002,107 $ 3,938,607
--------------- ---------------
--------------- ---------------

Current liabilities:
Accounts payable and accrued
liabilities $ 126,853 $ 163,424
--------------- ---------------
--------------- ---------------

Shareholders' equity:
Share capital 35,323,533 35,275,533
Contributed surplus 672,446 672,446
Accumulated stock-based
compensation 437,600 420,200
Deficit (31,558,325) (32,592,996)
--------------- ---------------
Total shareholders' equity 4,875,254 3,775,183
--------------- ---------------

Total liabilities and shareholders'
equity $ 5,002,107 $ 3,938,607
--------------- ---------------
--------------- ---------------


Romarco's net income for the first quarter of 2006 is due to the break fees received from Western Goldfields, Inc. upon the mutually agreed to termination of the proposed merger. The receipt of the $1.4 million in fees offset the overhead costs incurred by Romarco as it oversees exploration at its projects and evaluates precious metals properties for acquisition. The Company had a net income $1,034,671 for the three months ended March 31, 2006 versus a loss of $306,591 for the three months ended March 31, 2005.

General and administrative costs for the first quarter of 2006, and consulting fees in particular, are higher than the same period of 2005 due primarily to the extra costs incurred by the company as it worked to complete the merger with Western Goldfields. Merger costs of $60,697 consist primarily of legal and accounting fees incurred in the preparation of the merger agreement and planned F-4 Registration Statement.

Salaries increased from 2005 due to increased staffing levels while shareholder relations expenses decreased as the Company reduced its use of outside services. Attendance at industry trade shows was less in the first quarter of 2006 than in the first quarter of 2005, also helping to lower shareholder relations expenses as well as travel expenses.

Other general and administrative expenses includes a donation made to the Ralph J. Roberts Center for Research in Economic Geology at the University of Nevada, Reno for the purpose of research and student support.

Stock-based compensation for the first quarter of 2006 is considerably lower than it was for the previous year. During the first quarter of 2005 the Company issued 1,450,000 options to staff, directors and consultants, but did not issue and options in the first quarter of 2006. The Company recognized $17,400 of stock-based compensation in the first quarter of 2006 with a corresponding increase in the separate component of shareholders' equity. For the first quarter of 2005, the Company recognized $89,650 of stock based compensation with a corresponding increase in the separate component of shareholders' equity.

Interest income earned in the first quarter of 2006 is higher than in the first quarter of 2005 due to increased cash levels and the interest earned on the advances made to Western Goldfields. In February 2006, Romarco received US $1.953 million as payment of these advances, including accrued interest, as well as the merger break fees. The slight weakening of the Canadian dollar versus the US dollar from the time the funds were received to March 31, 2006 resulted in the foreign exchange gain recognized in the first quarter of 2006.

At March 31, 2006, the Company had cash and cash equivalents totalling $2,330,917 as compared to $930,438 at March 31, 2005. In February 2006, the Company and Western Goldfields terminated the definitive merger agreement. In consideration for agreeing to such termination, Western Goldfields paid the Company US$1,953,000 for a break fee, expense compensation and the repayment of all outstanding loans and accrued interest.

During the first quarter of 2006, Romarco spent $289,176 and issued 300,000 common shares valued at $48,000 for its mineral property interests while in the first quarter of 2005, the Company spent $96,269 and issued 300,000 common shares valued at $66,000 for its mineral property interests.

Romarco began the second quarter of 2006 with $2,330,917 in cash and no debt. Drill programs at four of Romarco's properties are planned for 2006: Buckskin-National, Pine Grove and Roberts Mountain in Nevada; and Cori Puncho in Peru.

ON BEHALF OF ROMARCO MINERALS INC.

Diane R. Garrett, President and C.E.O.


The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release, which has been prepared by management.

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