IAMGOLD Corporation
TSX : IMG
NYSE : IAG
ASX : IGD
BOTSWANA : IAMGOLD

IAMGOLD Corporation

May 12, 2006 07:31 ET

IAMGOLD announces record first quarter earnings




TSX Trading Symbol: IMG
NYSE Trading Symbol: IAG
ASX Trading Symbol: IGD
Fully Diluted Shares Outstanding: 178.9MM


TORONTO, ONTARIO--(May 12, 2006) -



HIGHLIGHTS:

- Net earnings for the first quarter of 2006 were a record $19.9 million or $0.13 per share compared to $7.7 million or $0.05 per share for the first quarter of 2005.

- Attributable gold production for the quarter was 123,000 ounces at a cash cost, as defined by the Gold Institute, of $271/oz, compared to 106,000 ounces and $273/oz respectively for the first quarter of 2005.

- Operating cash flow for the quarter was $21.8 million, compared to $8.5 million for the first quarter of 2005.

- Average gold spot price for the first quarter in 2006 was $554 per ounce in comparison to $427 per ounce for the same period in 2005.

- On March 22, 2006, the acquisition of Gallery Gold Limited was completed.



CONSOLIDATED FINANCIAL RESULTS SUMMARY (US$000's):
-------------------------------------------------------------------------
Three Months Ended
-------------------------------------------------------------------------
Mar. 31, Mar. 31,
2006 2005
-------------------------------------------------------------------------
Net earnings $ 19,851 $ 7,743
Operating cash flow $ 21,794 $ 8,533
Net earnings per share - basic and diluted $ 0.13 $ 0.05
Operating cash flow per share - basic and diluted $ 0.14 $ 0.06
Gold produced (oz) IMG share 123,278 106,403
GI cash cost (US$/oz)(i) $ 271 $ 273
Average realized gold price (US$/oz) $ 553 $ 427

(i) GI cash cost per ounce is a non-GAAP measure. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



CONFERENCE CALL

A conference call to review the Corporation's first quarter results will
take place on Friday, May 12, 2006 at 11:00 a.m. EST. Local call-in number:
416-644-3418, N.A. toll-free: 1-800-814-4859 and Australia toll-free
011-800-0088-8228. This conference call will also be audiocast on our website
(www.iamgold.com).

A replay of this conference call will be available from 2:00 p.m.
May 12-19, 2006 by dialing local: 416-640-1917, passcode: 21185332 followed by
the number sign and N.A. toll-free: 1-877-289-8525, passcode: 21185332
followed by the number sign. A replay will also be available on IAMGOLD's
website.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION & RESULTS OF OPERATIONS

(The following report dated May 11, 2006, should be read in conjunction with the Consolidated Financial Statements for March 31, 2006 and related notes thereto which appear elsewhere in this report. All monetary amounts in this MD&A are expressed in US$ unless otherwise indicated.)

OVERVIEW
-------------------------------------------------------------------------

Acquisition

On March 22, 2006, the Company acquired all of the issued and outstanding
shares of Gallery Gold Limited ("GGL") in exchange for the issuance of
26,221,468 common shares. GGL, through its subsidiaries, owns a 100% interest
in the Mupane gold mine in Botswana and a controlling interest in the Buckreef
development project in Tanzania. The purchase price has been determined to be
$201.3 million, including acquisition costs of $1.3 million and the settlement
of GGL common share options for cash of $2.5 million.

The acquisition has been accounted for under the purchase method with the
preliminary allocation of the fair value of the consideration to the fair
value of the identifiable assets and liabilities on the closing date as set
out below:


-------------------------------------------------------------------------
Fair Value
-------------------------------------------------------------------------
Assets and liabilities acquired:
(in $000's except where noted)

Cash and cash equivalents $ 935
Other current assets 16,721
Long-term assets 228,012
Goodwill 73,038
Current liabilities (27,719)
Long-term liabilities (89,718)
-------------------------------------------------------------------------
$ 201,269
-------------------------------------------------------------------------
-------------------------------------------------------------------------



The financial results for GGL for the nine day period from March 22 to
March 31 have been determined to be immaterial to the full quarter results for
IAMGOLD. As a result, the nine day period has been excluded from the financial
position and results of operations.

Financial Results

Net earnings for the first quarter of 2006 were $19.9 million or $0.13
per share compared to $7.7 million or $0.05 per share for the first quarter of
2005. The increase in earnings is mainly a result of higher gold prices and
exceptional production and cost containment at the Yatela mine in Mali.

Operating cash flow for the first quarter of 2006 was $21.8 million or
$0.14 per share compared to $8.5 million or $0.05 per share for the first
quarter of 2005. The increase is a result of higher gold prices and improved
performance at the Sadiola and Yatela operations and dividend distributions of
$5.9 million received from the Tarkwa and Damang operations. In addition, loan
repayments of $6.3 million were received from Tarkwa. These loan repayments
are classified as investing cash flow.


Summarized Financial Results
(in $000's except where noted)
-------------------------------------------------------------------------
2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Net earnings $19,851 $6,178 $4,198 $2,375 $7,743
Net earnings
per share
- basic and
diluted 0.13 0.04 0.03 0.02 0.05

Operating
cash flow
(deficiency) 21,794 18,002 1,828 5,680 8,533
Operating
cash flow
(deficiency)
per share
- basic and
diluted 0.14 0.12 0.01 0.04 0.06

Cash,
short-term
deposits and
gold bullion
(at cost) 133,323 94,374 90,799 88,572 84,361
(at market) 170,864 121,673 112,204 104,626 98,998
Gold produced
(000 oz -
IMG share) 123 117 109 114 106

Weighted average
GI cash cost
($/oz - IMG
share)(*) 271 276 281 275 273
Gold spot price
($/oz)(xx) 554 485 439 427 427
------------------------------------------------------------------------
------------------------------------------------------------------------


Summarized Financial Results
(in $000's except where noted)
-------------------------------------------------
2004
-------------------------------------------------
4th Qtr 3rd Qtr 2nd Qtr
-------------------------------------------------
Net earnings $2,897 $908 $622
Net earnings
per share
- basic and
diluted 0.02 0.01 0.00

Operating
cash flow
(deficiency) (4,713) 18,886 (6,263)
Operating
cash flow
(deficiency)
per share
- basic and
diluted (0.03) 0.13 (0.04)

Cash,
short-term
deposits and
gold bullion
(at cost) 85,436 93,017 94,900
(at market) 101,260 105,920 104,904
Gold produced
(000 oz - IMG
share) 119 99 108

Weighted average
GI cash cost
($/oz - IMG
share)(i) 253 255 243
Gold spot price
($/oz)(xx) 434 401 393
-------------------------------------------------
-------------------------------------------------
(i) Weighted average Gold Institute cash cost per ounce is a non-GAAP
measure. Please refer to the Supplemental Information to the
Management's Discussion and Analysis for reconciliations to GAAP.
(xx) Average gold price as per the London pm fix.


IAMGOLD Attributable Production and Costs

2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Production (000 oz)
Sadiola - 38% 42 43 44 43 38
Yatela - 40% 33 31 21 23 23
Tarkwa - 18.9% 36 32 33 37 35
Damang - 18.9% 12 11 11 11 10
Total production 123 117 109 114 106

Total cash cost
($/oz - IMG
share)(i) 294 304 299 292 283
GI cash cost ($/oz
- IMG share)(i) 271 276 281 275 273
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(i) Cash costs per ounce are non-GAAP measures. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



Gold production at the four operating mines was 16% ahead of production
from the first quarter of 2005 as all operations performed reasonably well.

IAMGOLD's attributable share of gold production in 2006 from the above
four operating mines remains forecast at 480,000 ounces for the full year,
with estimated total cash cost per ounce, as defined by the Gold Institute, of
$295 per ounce for the year.


RESULTS OF OPERATIONS
-------------------------------------------------------------------------

Mining Interests

-------------------------------------------------------------------------
Mar. 31, Mar. 31,
($ 000's) 2006 2005
-------------------------------------------------------------------------
Gold sales $ 42,751 $ 27,230
Mining costs 21,026 18,452
Depreciation and depletion 6,105 4,727
-------------------------------------------------------------------------
Earnings from mining interests $ 15,620 $ 4,051
-------------------------------------------------------------------------



The Company records its proportionate share of assets, liabilities and
results of operations from its joint venture interests in the Sadiola and
Yatela mines.

The Company's share of Sadiola and Yatela revenue in 2006 was 57% higher
than the first quarter of 2005 due to a 29% increase in gold price and a 22%
increase in production. The average gold revenue at Sadiola and Yatela was
$554 per ounce in the first quarter of 2006 compared to $429 per ounce for the
same period in 2005. Average gold spot price for the first quarter in 2006 was
$554 per ounce in comparison to $427 per ounce for the same period in 2005.

The Company's share of Sadiola and Yatela operating expenses in 2006 was
5% higher than the first quarter of 2005 as a result of the increased
production and revenue-based costs. Consolidated Gold Institute cash costs at
Sadiola and Yatela declined to $244 per ounce in the first quarter of 2006
versus $280 per ounce for the same period in 2005.

In the fourth quarter of 2005, the Government of Mali conducted an audit
of taxes for the Sadiola and Yatela operations. As a result of the audit, the
Government made claims for unpaid taxes in excess of $6.0 million. The Company
disputes these claims but made a partial provision of $0.9 million against its
share of the claims in the 2005 year-end accounts. In the first quarter of
2006, the Company has recorded an additional $1.7 million expense as full
provision of its share of the claim.

For the Company's mines in Mali, the fourth quarter of any given year
normally includes five to six additional operating days as compared to the
first quarter of the subsequent year. This difference should be taken into
account when quarterly comparisons of performance measures are made.


Sadiola Mine (IAMGOLD interest - 38%)
Summarized Results
100% Basis
-------------------------------------------------------------------------
2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Tonnes mined
(000t) 5,020 5,300 3,720 5,710 4,600
Ore milled (000t) 1,110 1,320 1,360 1,170 1,180
Head grade (g/t) 3.5 3.0 2.9 3.7 3.4
Recovery (%) 88 88 92 82 80

Gold production -
100% (000 oz) 111 112 116 113 101
Gold sales -
100% (000 oz) 111 116 117 110 102

Gold revenue
($/oz)(i) 553 485 439 427 429
Direct cash costs
($/oz)(xx) 285 298 244 282 295
Production taxes
($/oz)(xx) 33 30 26 25 26
Total cash costs
($/oz)(xx) 318 328 270 307 321
Stockpile
adjustments
($/oz)(xx) (45) (39) (26) (46) (33)
GI cash cost
($/oz)(xx) 273 289 244 261 288
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(i) Gold revenue is calculated as gold sales divided by ounces of gold
sold.
(xx) Cash costs per ounce are non-GAAP measures. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



Tonnages mined for the first quarter are 5% lower and 10% higher than
achieved in the fourth and first quarters of 2005. Tonnages milled during the
first quarter was 16% lower than the fourth quarter of 2005 but comparable to
the first quarter of 2005. The reduction results mainly from the higher number
of operating days in the fourth quarter.

Direct cash costs, at $31.6 million, were lower than the $33.4 million
recorded during the first quarter of 2005 due to lower reagent costs. Per
ounce cash costs were lower in the first quarter of 2006 at $273, primarily
due to higher production.

Engineering work continues on the gravity concentration project for the
mill. The objective is to improve recovery by 3%. A fresh sample of deep
sulphide ore (2.5 million tonnes) was drilled in the first quarter and shipped
to laboratories for metallurgical testing, also with the objective of
improving overall recoveries and designing a cost effective plant.

Additions to capital assets at Sadiola amounted to $1.4 million for the
first quarter of 2006. $0.8 million of this amount was spent on the purchase
of mining equipment, $0.3 million for the 115 house extension of the mine
village and the remainder was spent on a variety of smaller capital projects.
Exploration expenditures for the first quarter amounted to $0.4 million, of
which $0.2 million was capitalized.

During the quarter, Sadiola made a profit distribution of $10.0 million,
with IAMGOLD's share being $3.8 million. Subsequent to quarter-end, an
additional profit distribution of $10.0 million, with IAMGOLD's share being
$3.8 million, was received. Operating cash flow at Sadiola for the first
quarter of 2006 was $20.4 million.


Yatela Mine (IAMGOLD interest - 40%)
Summarized Results
100% Basis
-------------------------------------------------------------------------
2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Tonnes mined
(000t) 2,310 3,170 2,780 4,250 4,200

Ore crushed (000t) 820 820 720 800 810
Head grade (g/t) 4.5 4.0 2.8 2.5 2.6
Gold stacked (oz) 119 105 65 64 68

Gold production -
100% (000 oz) 82 78 54 57 58
Gold sales -
100% (000 oz) 87 80 48 55 62

Gold revenue
($/oz)(i) 555 487 438 428 428
Direct cash costs
($/oz)(xx) 200 226 328 283 248
Production taxes
($/oz)(xx) 36 31 24 26 29
Total cash costs
($/oz)(xx) 236 257 352 309 277
Cash cost
adjustments
($/oz)(xx) (29) (36) (52) (3) (9)
GI cash cost
($/oz)(xx) 207 221 300 306 268
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(i) Gold revenue is calculated as gold sales divided by ounces of gold
sold.
(xx) Cash costs per ounce are non-GAAP measures. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



Gold production for the first quarter of 2006 was 5% and 41% higher than
production in the fourth and first quarters of 2005. Gold production for 2006
has been positively impacted by higher grades and recoveries as the mine has
now moved to the high grade portion of the orebody. Tonnes mined was 27% and
45% lower than the fourth and first quarters of 2005 due to less waste
stripping, and access restrictions at the pit bottom.

A pit cutback and deepening of the Yatela pit has been approved.
Stripping will commence in May. The current expectation is that the cutback
will add in excess of 350,000 ounces of production over the life of the mine
and extend production to the first half of 2009. The capital component of the
plan is $5.7 million primarily for additional leach pads.

Direct cash costs for the quarter were $16.4 million, which is higher
than the $14.3 million recorded in the first quarter of 2005. This increase is
primarily a result of the increase in production and an increase in
revenue-based costs. Gold Institute cash costs of $207 per ounce were 6% lower
than the fourth quarter of 2005 as a result of good performance on all fronts.
Results for the second quarter are expected to remain at attractive levels
with a tail off for the remainder of the year.

Capital expenditures at Yatela totaled $0.1 million for the first quarter
of 2006. This is expected to significantly increase for the remainder of the
year as a result of the pit cutback.

During the quarter, Yatela made loan repayments of $26.0 million, with
IAMGOLD's share being $9.6 million. Final settlement of Yatela shareholder
loans are expected to be made in the second quarter and dividend distributions
are expected to begin in the third quarter of this year. Operating cash flow
at Yatela for the first quarter was $23.5 million.


Working Interests
-------------------------------------------------------------------------
Three Months Ended
-------------------------------------------------------------------------
Mar. 31, Mar. 31,
($ 000's) 2006 2005
-------------------------------------------------------------------------
Tarkwa $ 7,185 $ 5,278
Damang $ 1,616 $ 444
-------------------------------------------------------------------------
Earnings from working interests $ 8,801 $ 5,722
-------------------------------------------------------------------------



The Company records on its consolidated statement of earnings, the
proportionate share of the profits from its working interests in the Tarkwa
mine and the Damang mine.

Earnings from working interests improved 54% in the first quarter of over
the same period in 2005 as a result of higher gold prices, a 6% increase in
production and a lower effective tax rate. This improvement is offset by an
increase in cash costs at both mines. Both the first quarter of 2006 and 2005
include a non-cash and non-recurring increase to earnings relating to future
taxes at Tarkwa and Damang of $1.9 million and $2.1 million (IMG share),
respectively as a result of a general reduction of effective tax rates in
Ghana from 29% to 25% in 2006 and 35% to 29% in 2005

The Company's share of amortization and depreciation expense recorded in
the determination of the above earnings are $2.1 million and $2.6 million for
the first quarter of 2006 and 2005 respectively.


Tarkwa Mine (IAMGOLD interest - 18.9%)
Summarized Results
100% Basis
-------------------------------------------------------------------------
2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Tonnes mined
(000t) 23,850 22,410 24,060 21,870 21,120

Tonnes mined
(000t) -
Pre-stripping 3,190 - - - -

Heap Leach:
-----------
Ore crushed (000t) 4,370 4,030 4,140 4,220 4,070
Head grade (g/t) 1.2 1.2 1.2 1.3 1.2
Gold stacked
(000 oz) 165 157 157 175 150
Recovery (%) 75 77 76 77 80
Gold production
(000 oz) 120 111 120 136 126

CIL:
----
Ore milled (000t) 1,300 1,130 1,140 1,180 1,160
Head grade (g/t) 1.7 1.6 1.5 1.7 1.8
Recovery (%) 97 98 97 98 97
Gold production
(000 oz) 72 56 54 63 59

Total gold
production & sales
- 100% (000 oz) 192 167 174 199 185

Gold revenue
($/oz)(i) 552 482 437 429 428
Direct cash costs
($/oz)(xx) 289 297 280 237 223
Production taxes
($/oz)(xx) 17 14 13 13 13
Total cash costs
($/oz)(xx) 306 311 293 250 236
Gold-in-process
adjustments
($/oz)(xx) (2) (16) (3) 5 2
GI cash cost
($/oz)(xx) 304 295 290 254 238
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(i) Gold revenue is calculated as gold sales divided by ounces of gold
sold.
(xx) Cash costs per ounce are non-GAAP measures. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



Gold production in the first quarter of 2006 was 15% and 4% higher than
production in the fourth and first quarters of 2005. Higher tonnages crushed
and milled are the main factors in the increase in production. Tonnes mined
remain at high levels. In addition, pre-stripping at the Teberebie pit began
in the first quarter of 2006 in order to release sufficient ore for the CIL
plant. This additional stripping has been capitalized. The CIL plant had
record throughput during the quarter.

During the first quarter preliminary engineering work has begun on
expanding the CIL plant. Final expansion tonnage will depend on the outcome of
this work. The expansion of the North Heap leach facility continued during the
quarter.

Direct cash costs for the first quarter of 2006 were $55.6 million, which
is higher than the $41.3 million recorded in the first quarter of 2005 as a
result of increases in volumes mined and higher fuel, cement and cyanide
prices. Gold Institute cash costs of $304 per ounce were 3% higher than the
fourth quarter of 2005.

Capital expenditures were $16.0 million during the first quarter of 2006.
$3.6 million was spent on leach pad expansions, $3.6 million was spent on the
Teberebie pre-stripping, $3.0 million was spent on the mining fleet and the
remaining was spent on other smaller capital projects.

During the first quarter, Tarkwa made profit distributions of
$50.0 million, with IAMGOLD's share being $10.3 million. $4.0 million of the
amount received is classified as a dividend and the remaining $6.3 million is
classified as a loan repayment, which is classified as an investing activity.
Cash balances at Tarkwa as at March 31, 2006 were $36.1 million. Further cash
distributions will be dependant on a decision on the mill expansion.


Damang Mine (IAMGOLD interest - 18.9%)
Summarized Results
100% Basis

2006 2005
-------------------------------------------------------------------------
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
-------------------------------------------------------------------------
Tonnes mined
(000t) 4,180 3,890 3,730 3,810 3,120

Tonnes mined
(000t) - Pit
cut back 2,570 1,990 1,550 - -

Ore milled (000t) 1,380 1,320 1,330 1,260 1,260
Head grade (g/t) 1.5 1.5 1.5 1.5 1.4
Recovery (%) 93 93 93 92 91

Gold production
& sales
- 100% (000 oz) 62 60 57 58 54

Gold revenue
($/oz)(i) 550 481 438 428 429
Direct cash costs
($/oz)(xx) 317 305 322 330 302
Production taxes
($/oz)(xx) 17 14 13 13 13
Total cash costs
($/oz)(xx) 334 319 335 343 315
Gold-in-process
adjustments
($/oz)(xx) 11 11 36 0 30
GI cash cost
($/oz)(xx) 345 330 371 343 345
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(i) Gold revenue is calculated as gold sales divided by ounces of gold
sold.
(xx) Cash costs per ounce are non-GAAP measures. Please refer to the
Supplemental Information attached to the Management's Discussion and
Analysis for a reconciliation to GAAP.



Gold production in the first quarter of 2006 was 3% and 15% higher than
production in the fourth and first quarters of 2005. Higher tonnages crushed
and milled are the main factors in the increase in production. Tonnes mined
remain at high levels.

The main Damang pit cut back, started in the third quarter 2005, remains
ahead of schedule. Work continued on raising the walls of the east tailings
dam.

Direct cash costs for the first quarter of 2006 were $19.7 million, which
is higher than the $16.3 million spent during the same period in 2005 due
mainly to increased operating strip ratios. Gold Institute cash costs were
$345 per ounce, which is 5% higher than the fourth quarter of 2005 but
comparable to the first quarter of 2005.

Capital expenditures were $8.1 million for the first quarter of 2006, of
which $6.3 million was spent on the pit cut back and the remainder was spent
on a variety of small capital projects.

During the first quarter, Damang made profit distributions of
$10.0 million, with IAMGOLD's share being $1.9 million. Cash balances at
Damang as of March 31, 2006 were $32.1 million.


Royalty Interests
-------------------------------------------------------------------------
Three Months Ended
-------------------------------------------------------------------------
March 31, March 31,
($ 000's) 2006 2005
-------------------------------------------------------------------------
Gold Royalties
Revenue $ (83) $ 706
Amortization (61) 344

Diamond Royalties
Revenue 1,813 1,557
Amortization 959 818
-------------------------------------------------------------------------
Earnings from Royalty Interests $ 832 $ 1,101
-------------------------------------------------------------------------



On April 25, 2006, the Company sold the majority of its gold royalty
interests for $21.9 million. Royalty revenues attributable to the Company in
the first quarter were included in the sale. As a result, earnings from
royalty interests in the first quarter of 2006 are 24% lower than the first
quarter of 2005. Negative gold royalty revenue and amortization is a result of
an overstatement of accrued revenues in 2005. The Company will continue to
receive royalty revenue from the Diavik diamond mine in Canada.

Corporate Administration and Other

Corporate administration at $2.6 million for the first quarter of 2006 is
higher than the $2.0 million for the first quarter of 2006 due to general
increases in costs and expenditures.

Exploration expenditures of $2.2 million in the first quarter of 2006
were higher than the $1.2 million expended in the first quarter of 2005 due to
a late start in the 2005 exploration program. Exploration expenditures
relating to the Quimsacocha project are being capitalized and constitute
$0.9 million of the $2.2 million total. The exploration budget for the first
six months of 2006 is $7.4 million with $4.2 million relating to the
Quimsacocha project.

Cash Flow

Operating cash flow was $21.8 million for the first quarter of 2006
compared to $8.5 million for the same period in 2005. The increase in
operating cash flow is a result of improved performances at the Sadiola and
Yatela operations, increased gold prices and $5.9 million of dividend
distributions received from the Tarkwa and Damang operations during the
quarter. Cash distributions from Tarkwa are expected to continue in 2006.

Financing cash flow was negative $3.3 million in the first quarter of
2006 compared to negative $6.1 million in the first quarter of 2005. The
change is mainly a result of an increased number of options exercised.

Investing cash flow was $5.2 million in the first quarter of 2006
compared to negative $3.7 million in the first quarter of 2005. The increase
in cash flow is mainly a result of loan repayments received from Tarkwa of
$6.3 million during the quarter. In respect of investing activities at the
Sadiola and Yatela operations, $0.7 million was expended during the first
quarter of 2006.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------------------------------------------------

The Company maintains a strong balance sheet and has sufficient liquidity
and capital resources to fund its known commitments.

Working Capital

The Company's consolidated working capital position is set out below
(in $ millions):


-------------------------------------------------------------------------
March 31, December 31,
2006 2005
-------------------------------------------------------------------------
Working Capital $ 130.6 $ 114.5
Current Ratio 3.5 5.0
-------------------------------------------------------------------------
-------------------------------------------------------------------------



Cash and Short-Term Deposits

Consolidated cash balances totaled $84.5 million at March 31, 2006
compared to $61.4 million at year-end 2005, and can be segmented as follows
(in $ millions):


-------------------------------------------------------------------------
March 31, December 31,
2006 2005
-------------------------------------------------------------------------
Corporate cash and short-term deposits $ 74.3 $ 53.4
Joint venture cash 10.2 8.0
-------------------------------------------------------------------------
Total $ 84.5 $ 61.4
-------------------------------------------------------------------------
-------------------------------------------------------------------------



Joint venture cash represents the Company's proportionate share of cash
at the Sadiola and Yatela mines and forms part of the working capital at those
operations. Cash balances exclude the Company's proportionate share of cash
balances held at the Tarkwa and Damang mines which equate to $6.8 million and
$6.1 million respectively as at March 31, 2006 and $8.6 million and
$7.7 million respectively as at December 31, 2005.

Corporate cash and short-term deposits increased by $20.8 million in the
first quarter of 2006 compared to a decrease of $6.5 million in the same
period of 2005. Cash flows that determined these changes are shown below (in $
millions):


-------------------------------------------------------------------------
Three Months Ended
-------------------------------------------------------------------------
March 31, March 31,
2006 2005
-------------------------------------------------------------------------
Inflows
Tarkwa cash receipts $ 10.3 $ -
Yatela cash receipts 9.6 -
Share issuances, net of share issue costs 8.5 1.2
Sadiola cash receipts 3.8 -
Damang cash receipts 1.9 -
Royalties received, net of withholding taxes
and gold bullion receipts 1.7 1.9
Interest income 0.9 0.2
Foreign exchange gain on cash balances - 0.1
Other - 0.3
-------------------------------------------------------------------------
$ 36.7 $ 3.7
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Outflows
Dividends $ 8.9 $ 7.3
Gallery Gold acquisition transaction costs,
net of cash acquired 2.1 -
Exploration, development and exploration
administration 2.2 1.2
Corporate administration and taxes 2.2 1.6
Other assets 0.1 -
Foreign exchange loss on cash balances 0.2 -
Other 0.2 0.1
-------------------------------------------------------------------------
$ 15.9 $ 10.2
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net inflow (outflow) $ 20.8 $ (6.5)
-------------------------------------------------------------------------
-------------------------------------------------------------------------



The impact on corporate cash balances resulting from the Gallery
acquisition is as follows (in $millions):


-------------------------------------------------------------------------
Cash balance acquired $ 0.9
Purchase of Gallery options (2.5)
Transaction costs (0.5)
-------------------------------------------------------------------------
$(2.1)
-------------------------------------------------------------------------



In addition, the Company paid $0.7 million in 2005 for transaction costs.

Gold Bullion

At March 31, 2006, the accumulated gold bullion balance was 148,442
ounces at an average cost of $329 per ounce for a total cost of $48.9 million.
The market value of the bullion was $86.4 million using a March 31, 2006 gold
price of $582 per ounce.

Some of the disclosures included in this interim report for the first
quarter of 2006 represent forward-looking statements (as defined in the
US Securities Exchange Act of 1934). Such statements are based on assumptions
and estimates related to future economic and market conditions. While
management reviews the reasonableness of such assumptions and estimates,
unusual or unanticipated events may occur which render them inaccurate. Under
such circumstances, future performances may differ materially from
projections.

The Corporation's auditors have not reviewed the contents of this MD&A or
the accompanying financial statements.

As at May 11, 2006, the number of shares issued and outstanding of the
Corporation was 175.6 million.


Please note:
------------

This entire press release may be accessed via fax, e-mail, IAMGOLD's website at www.iamgold.com and through CCNMatthews' website at www.ccnmmathews.com. All material information on IAMGOLD can be found at www.sedar.com or at www.sec.gov. If you wish to be placed on IAMGOLD's email press release list, please contact us at info@iamgold.com.

SUPPLEMENTAL INFORMATION TO THE MANAGEMENT'S DISCUSSION AND ANALYSIS

NON-GAAP PERFORMANCE MEASURES
-------------------------------------------------------------------------

The Company has included cash cost per ounce data, which are non-GAAP
performance measures, in order to provide investors with information about the
cash generating capabilities and profitability of the Company's mining
operations and comparability to other gold producers. The Company reports
total cash cost per ounce wherein the cash cost equals the sum of operating
costs inclusive of production-based taxes and management fees. The Company
also reports Gold Institute cash cost per ounce data in accordance with the
Gold Institute Standard, which the Company believes most gold producers
follow. GI cash cost equals total cash cost, as described previously, adjusted
for the inclusion of certain cash costs incurred in prior periods or the
exclusion of certain cash costs incurred in the current period related to
future production such as stockpiling, gold in process and stripping costs.
These measures differ from measures determined in accordance with GAAP and
should not be considered in isolation or as a substitute for measures of
performance or liquidity prepared in accordance with GAAP. These measures are
not necessarily indicative of operating profit or cash flow from operations as
determined under GAAP.


-------------------------------------------------------------------------
(in $000's
except where 2006 2005
noted) Q1 Q4 Q3 Q2 Q1
-------------------------------------------------------------------------
Net earnings from joint ventures and working interests:
-------------------------------------------------------
Joint ventures:
Sadiola $ 4,463 $ 1,846 $ 3,328 $ 1,632 $ 1,427
Yatela 8,139 3,893 1,521 965 1,874
Working
interests:
Tarkwa 7,185 2,828 2,259 3,371 5,278
Damang 1,616 831 292 164 444
-------------------------------------------------------------------------
As per segmented
information
note to
financial
statements $ 21,403 $ 9,398 $ 7,400 $ 6,132 $ 9,023
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Sadiola (38% proportionate share):
----------------------------------
Gold revenue $ 23,361 $ 21,377 $ 19,464 $ 17,855 $ 16,597

Mining costs:
Total cash
costs (13,442) (13,963) (11,917) (13,202) (12,259)
Stockpile
movement 1,897 1,686 1,135 1,987 1,273
-------------------------------------------------------------------------
Gold Institute
cash costs (11,545) (12,277) (10,782) (11,215) (10,986)
Change in
bullion
inventory 21 (242) (20) 147 (38)
Exploration
expensed (145) (50) (75) (181) (62)
Foreign
exchange and
interest (1,456) (3,797) (313) (1,157) (774)
Other
non-cash
adjustments 25 133 132 131 340
-------------------------------------------------------------------------
(1,555) (3,956) (276) (1,060) (534)
-------------------------------------------------------------------------
Mining costs (13,100) (16,233) (11,058) (12,275) (11,520)
-------------------------------------------------------------------------
10,261 5,144 8,406 5,580 5,077
Depreciation (2,521) (3,283) (3,312) (3,094) (2,900)
Income taxes (3,277) (15) (1,766) (854) (750)
-------------------------------------------------------------------------
Net earnings
from Sadiola $ 4,463 $ 1,846 $ 3,328 $ 1,632 $ 1,427
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gold production
- 100% (000 oz) 111 112 116 113 101
Gold production
- 38% (000 oz) 42 43 44 43 38
Total cash costs
per ounce
($/oz) $ 318 $ 328 $ 270 $ 307 $ 321
Gold Institute
cash costs
per ounce
($/oz) $ 273 $ 289 $ 244 $ 261 $ 288
-------------------------------------------------------------------------



-------------------------------------------------------------------------
(in $000's
except where 2006 2005
noted) Q1 Q4 Q3 Q2 Q1
-------------------------------------------------------------------------
Yatela (40% proportionate share):
---------------------------------
Gold revenue $ 19,390 $ 15,617 $ 8,440 $ 9,410 $ 10,633

Mining costs:
Total cash
costs (7,775) (8,032) (7,541) (6,998) (6,374)
Cash cost
adjustments:
Stockpile
movement 1,175 (144) (1,879) (1,741) (429)
Deferred
stripping (939) 1,538 3,199 1,766 249
Gold in process 738 (273) (194) 49 382
-------------------------------------------------------------------------
974 1,121 1,126 75 202
-------------------------------------------------------------------------
Gold Institute
cash costs (6,801) (6,911) (6,415) (6,924) (6,172)
Change in
bullion
inventory (531) (471) 747 255 (611)
Exploration
expensed (8) - - - -
Foreign exchange
and interest (762) (1,528) 152 (129) (130)
Other non-cash
adjustments 176 98 75 153 (19)
-------------------------------------------------------------------------
(1,125) (1,901) 974 279 (760)
-------------------------------------------------------------------------
Mining costs (7,926) (8,812) (5,441) (6,645) (6,932)
-------------------------------------------------------------------------
11,464 6,805 2,999 2,765 3,701
Depreciation (3,584) (2,912) (1,478) (1,800) (1,827)
Income taxes 259 - - - -
-------------------------------------------------------------------------
Net earnings
(loss) from
Yatela $ 8,139 $ 3,893 $ 1,521 $ 965 $ 1,874
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gold production
- 100% (000 oz) 82 78 54 57 58
Gold production
- 40% (000 oz) 33 31 21 23 23
Total cash
costs per
ounce ($/oz) $ 236 $ 257 $ 352 $ 309 $ 277
Gold Institute
cash costs per
ounce ($/oz) $ 207 $ 221 $ 300 $ 306 $ 268
-------------------------------------------------------------------------


Tarkwa (18.9% proportionate share):
-----------------------------------
Gold revenue $ 20,079 $ 15,188 $ 14,387 $ 16,154 $ 14,954

Mining costs:
Total cash
costs (11,110) (9,801) (9,654) (9,384) (8,252)
Gold in process 65 524 102 (183) (77)
-------------------------------------------------------------------------
Gold Institute
cash costs (11,045) (9,277) (9,552) (9,567) (8,329)
Interest income
(expense) (33) (119) 248 136 130
-------------------------------------------------------------------------
Mining costs (11,078) (9,396) (9,304) (9,431) (8,199)
-------------------------------------------------------------------------
9,001 5,792 5,083 6,723 6,755
Depreciation (1,984) (1,756) (1,837) (1,898) (2,201)
Income taxes 168 (1,208) (987) (1,454) 724
-------------------------------------------------------------------------
Net earnings
from Tarkwa $ 7,185 $ 2,828 $ 2,259 $ 3,371 $ 5,278
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gold production
- 100% (000 oz) 192 167 174 199 185
Gold production
- 18.9%
(000 oz) 36 32 33 37 35
Total cash
costs per
ounce ($/oz) $ 305 $ 311 $ 293 $ 249 $ 236
Gold Institute
cash costs per
ounce ($/oz) $ 304 $ 295 $ 290 $ 254 $ 238
-------------------------------------------------------------------------



-------------------------------------------------------------------------
(in $000's
except where 2006 2005
noted) Q1 Q4 Q3 Q2 Q1
-------------------------------------------------------------------------
Damang (18.9% proportionate share):
-----------------------------------
Gold revenue $ 6,447 $ 5,474 $ 4,733 $ 4,713 $ 4,367

Mining costs:
Total cash
costs (3,916) (3,631) (3,620) (3,778) (3,209)
Gold in process (128) (123) (388) (4) (311)
-------------------------------------------------------------------------
Gold Institute
cash costs (4,044) (3,754) (4,008) (3,782) (3,520)
Exploration
expensed (57) (107) (119) (63) (74)
Interest income
(expense) 19 (129) 138 110 48
-------------------------------------------------------------------------
Mining costs (4,082) (3,990) (3,989) (3,735) (3,546)
-------------------------------------------------------------------------
2,365 1,484 744 978 821
Depreciation (278) (250) (295) (481) (381)
Income taxes (471) (403) (157) (333) 4
-------------------------------------------------------------------------
Net earnings
from Damang $ 1,616 $ 831 $ 292 $ 164 $ 444
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gold production
- 100% (000 oz) 62 60 57 58 54
Gold production
- 18.9% (000 oz) 12 11 11 11 10
Total cash
costs per
ounce ($/oz) $ 334 $ 319 $ 335 $ 343 $ 315
Gold Institute
cash costs per
ounce ($/oz) $ 345 $ 330 $ 371 $ 343 $ 345
-------------------------------------------------------------------------


Total joint ventures and working interests:
-------------------------------------------
Gold revenue $ 69,277 $ 57,656 $ 47,024 $ 48,132 $ 46,551
Mining costs:
Total cash costs (36,243) (35,427) (32,732) (33,362) (30,094)
Total cash
adjustments 2,808 3,208 1,975 1,874 1,087
-------------------------------------------------------------------------
Gold Institute
cash costs (33,435) (32,219) (30,757) (31,488) (29,007)
Other
adjustments (2,751) (6,212) 965 (598) (1,190)
-------------------------------------------------------------------------
Mining costs (36,186) (38,431) (29,792) (32,086) (30,197)
-------------------------------------------------------------------------
33,091 19,225 17,232 16,046 16,354
Depreciation (8,367) (8,201) (6,922) (7,273) (7,309)
Income taxes (3,321) (1,626) (2,910) (2,641) (22)
-------------------------------------------------------------------------
Net earnings
from all
mines $ 21,403 $ 9,398 $ 7,400 $ 6,132 $ 9,023
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Attributable
production
(000 oz) 123 117 109 114 106
Weighted average
Total cash
costs per
ounce ($/oz) $ 294 $ 304 $ 299 $ 292 $ 283
Weighted
average
Gold Institute
cash costs
per ounce
($/oz) $ 271 $ 276 $ 281 $ 275 $ 273
-------------------------------------------------------------------------



CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS

(unaudited)
(United States Dollars in 000's, except per share data)

For the period ended March 31, 2006
-----------------------
Three months ended
March 31, March 31,
2006 2005
-------------------------------------------------------------------------

Revenue:
Gold sales $ 42,751 $ 27,230
Royalties 1,730 2,263
-------------------------------------------------------------------------
44,481 29,493

Expenses:
Mining costs 21,026 18,452
Depreciation and depletion 6,105 4,727
Amortization of royalty interests 898 1,162
-------------------------------------------------------------------------
28,029 24,341
-------------------------------------------------------------------------
16,452 5,152
Earnings from working interests 8,801 5,722
-------------------------------------------------------------------------
25,253 10,874
-------------------------------------------------------------------------
Other expenses (income):
Corporate administration 2,646 1,954
Exploration 1,289 1,157
Foreign exchange 174 (156)
Investment income (856) (91)
-------------------------------------------------------------------------
3,253 2,864
-------------------------------------------------------------------------
Earnings before income taxes 22,000 8,010
Income taxes (recovery):
Current 3,129 936
Future (980) (669)
-------------------------------------------------------------------------
2,149 267
-------------------------------------------------------------------------
Net earnings 19,851 7,743
Retained earnings, beginning of period 54,021 42,397
-------------------------------------------------------------------------
Retained earnings, end of period $ 73,872 $ 50,140
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Number of common shares (000's)
Average outstanding during period 151,872 145,835
Outstanding at end of period 175,586 146,116

Net earnings per share (basic and diluted) $ 0.13 $ 0.053
-------------------------------------------------------------------------
-------------------------------------------------------------------------

See accompanying notes to the consolidated financial statements.



CONSOLIDATED BALANCE SHEET

(unaudited)
(United States Dollars in 000's, except per share data)

As at March 31, 2006

As at As at
March 31, December 31,
2006 2005
-------------------------------------------------------------------------
ASSETS

Current assets:
Cash and cash equivalents (note 2) $ 69,136 $ 45,534
Short term deposits 15,335 15,823
Gold bullion
(market value $86,393; Dec. 31, 2005
- $76,139) (note 3) 48,852 48,840
Accounts receivable and other 22,157 20,267
Inventories 26,813 12,825
-------------------------------------------------------------------------
182,293 143,289
Ore stockpiles 20,334 17,940
Long-term receivables 16,814 13,600
Working interests 89,416 92,762
Royalty interests 50,584 51,482
Mining interests 197,922 70,716
Deferred exploration 95,835 962
Other assets 3,360 3,347
Goodwill 147,924 74,886
-------------------------------------------------------------------------
$ 804,482 $ 468,984
-------------------------------------------------------------------------
-------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
Accounts payable and accrued liabilities $ 31,470 $ 19,892
Current portion of loans payable (note 4) 4,950 -
Current portion of hedge liability 15,290 -
Dividends payable - 8,870
-------------------------------------------------------------------------
51,710 28,762
Long-term liabilities:
Long-term portion of loans payable (note 4) 15,688 6,924
Future income tax liability 45,157 14,791
Asset retirement obligations 10,103 7,506
Long-term portion of hedge liability 40,817 -
Gold call option 3,604 -
-------------------------------------------------------------------------
115,369 29,221
-------------------------------------------------------------------------
Shareholders' equity:
Common shares (Issued: 175,586,000 shares)
(note 5) 559,443 352,606
Stock-based compensation (note 5(a)) 4,383 4,671
Share purchase loans (295) (296)
Retained earnings 73,872 54,021
-------------------------------------------------------------------------
637,403 411,002
-------------------------------------------------------------------------
$ 804,482 $ 468,985
-------------------------------------------------------------------------
-------------------------------------------------------------------------

See accompanying notes to the consolidated financial statements.



CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)
(United States Dollars in 000's, except per share data)

For the period ended March 31, 2006

----------------------
Three months ended
March 31, March 31,
2006 2005
-------------------------------------------------------------------------

Operating activities:
Net earnings $ 19,851 $ 7,743
Items not affecting cash:
Earnings from working interests,
net of dividends (2,929) (5,722)
Depreciation, depletion and amortization 7,037 5,905
Future income taxes (980) (669)
Stock-based compensation 496 189
Unrealized foreign exchange losses (gains) 169 (107)
Change in non-cash current working capital 5,715 2,010
Change in non-cash long-term working capital (7,565) (816)
-------------------------------------------------------------------------
21,794 8,533
-------------------------------------------------------------------------
Financing activities:
Issue of common shares, net of issue costs 8,537 1,166
Dividends paid (8,870) (7,276)
Repayments of non-recourse loans (2,975) (4)
-------------------------------------------------------------------------
(3,308) (6,114)
-------------------------------------------------------------------------
Investing activities:
Gallery Gold transaction costs, net of cash
acquired (note 1) (2,146) -
Mining interests (661) (3,418)
Deferred exploration (923) -
Note receivable 2,151 (72)
Distributions received from working interests 6,275 -
Short term deposits 488 (1)
Gold bullion royalties (12) (212)
Other assets (56) (4)
-------------------------------------------------------------------------
5,116 (3,707)
-------------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents 23,602 (1,288)
Cash and cash equivalents, beginning of period 45,534 37,152
-------------------------------------------------------------------------
Cash and cash equivalents, end of period $ 69,136 $ 35,864
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Supplemental cash flow information:
Interest paid $ 746 $ -
Income taxes 3,129 936
-------------------------------------------------------------------------

See accompanying notes to the consolidated financial statements.



NOTES TO CONSOLIDATED STATEMENTS
(unaudited)
(Tabular amounts in thousands of United States Dollars except per share data)

For the period ended March 31, 2006

The interim consolidated financial statements of IAMGOLD Corporation ("the Company") have been prepared by management in accordance with accounting principles generally accepted in Canada. The interim consolidated financial statements have been prepared following the same accounting policies and methods of computation as the consolidated financial statements for the fiscal year ended December 31, 2005 except as noted. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto in the Company's annual report for the year ended December 31, 2005. The results of operations for the three-month period are not necessarily indicative of the results to be expected for the full year.

1. ACQUISITION:
-------------------------------------------------------------------------

On March 22, 2006, the Company acquired all of the issued and outstanding shares of Gallery Gold Limited ("GGL") in exchange for the issuance of 26,221,468 common shares. GGL, through its subsidiaries, owns a 100% interest in the Mupane gold mine in Botswana and a controlling interest in the Buckreef development project in Tanzania. The purchase price has been determined to be $201.3 million, including acquisition costs of $1.3 million and the settlement of GGL common share options for cash of $2.5 million.

The acquisition has been accounted for under the purchase method. The preliminary allocation of the fair value of the consideration to the fair value of the identifiable assets and liabilities on the closing date are set out below.


---------------------------------------------------------------------
Fair Value
---------------------------------------------------------------------
Assets and liabilities acquired:
Cash and cash equivalents $ 935
Accounts receivable and other 3,483
Inventories and stockpiles 13,238
Marketable securities 472
Mining interests 133,590
Exploration and development 93,950
Goodwill 73,038
Accounts payable and other liabilities (7,479)
Loans payable (16,588)
Hedge liability (56,107)
Gold call option (3,604)
Asset retirement obligation (2,506)
Future tax liability (31,153)
---------------------------------------------------------------------
$ 201,269
---------------------------------------------------------------------
---------------------------------------------------------------------

Consideration paid:
Issue of 26,221,468 common shares of the Company $ 197,448
Settlement of GGL common share options 2,472
Cost of acquisition 1,349
---------------------------------------------------------------------
$ 201,269
---------------------------------------------------------------------
---------------------------------------------------------------------


2. CASH AND CASH EQUIVALENTS:
-------------------------------------------------------------------------
March 31, December 31,
2006 2005
---------------------------------------------------------------------
Corporate $ 58,887 $ 37,576
Joint ventures 10,249 7,958
---------------------------------------------------------------------
$ 69,136 $ 45,534
---------------------------------------------------------------------
---------------------------------------------------------------------


3. GOLD BULLION:
-------------------------------------------------------------------------

As at March 31, 2006, the Company held 148,442 ounces of gold bullion
at an average cost of $329 per ounce for a total cost of
$48.9 million. The market value of this gold bullion, based on the
market close price on March 31, 2006 of $582 per ounce was
$86.4 million.


4. LOANS PAYABLE:
-------------------------------------------------------------------------
March 31, December 31,
2006 2005
---------------------------------------------------------------------
Mupane loan $ 16,588 $ -
Yatela loan (a) 4,050 6,924
---------------------------------------------------------------------
20,638 6,924
Current portion of Mupane loan 4,950 -
---------------------------------------------------------------------
$ 15,688 $ 6,924
---------------------------------------------------------------------
(a) The Yatela loan is a non-recourse loan repayable out of cash
flow generated by the Yatela operation.


5. SHARE CAPITAL:
-------------------------------------------------------------------------

Authorized:
Unlimited first preference of shares, issuable in series
Unlimited second preference shares, issuable in series
Unlimited common shares
Issued and outstanding common shares are as follows:
---------------------------------------------------------------------
Number of
shares Amount
---------------------------------------------------------------------
Issued and outstanding, December 31, 2005 147,648,127 $ 352,606
Shares issued on acquisition of GGL
(note 1) 26,221,468 197,448
Exercise of options 1,697,734 9,241
Share bonus issued 10,390 86
Share purchase plan 8,546 62
---------------------------------------------------------------------
Issued and outstanding, March 31, 2006 175,586,265 $ 559,443
---------------------------------------------------------------------
---------------------------------------------------------------------


(a) Stock-based compensation:

The Company has a comprehensive share option plan for its
full-time employees, directors and officers and self-employed
consultants. The options vest over three years and expire no
longer than 10 years from the date of grant.

A summary of the status of the Company's share option plan as of
March 31, 2006 and changes during the three months then ended is
presented below. All exercise prices are denominated in Canadian
dollars.

----------------------------------------------------------------
Options Weighted
Average
Exercise
Price
----------------------------------------------------------------
Outstanding, beginning of period 4,076,242 $ 6.62
Granted 845,000 10.75
Exercised (1,697,734) 5.81
Forfeited - -
----------------------------------------------------------------
Outstanding, March 31, 2006 3,223,508 8.13
----------------------------------------------------------------
Options exercisable, March 31, 2006 1,776,286 6.74
----------------------------------------------------------------

The Company accounts for all stock-based compensation granted on
or after January 1, 2002, using the fair value based method.

The fair value of the options granted subsequent to January 1,
2002 has been estimated at the date of grant using a
Black-Scholes option pricing model with the following
assumptions: risk-free interest rate of 5%, dividend yield of
1%, volatility factor of the expected market price of the
Company's common stock of 37%; and a weighted average expected
life of these options of 4 or 8 years. The estimated fair value
of the options is expensed over the options' vesting period of 3
years and recorded as stock-based compensation within
shareholders' equity. As options are exercised, these
corresponding values are transferred to the common share account
within shareholders' equity. For the three months ended
March 31, 2006, $0.4 million was recorded as compensation
expense.

The Company has a share purchase plan for employees whereby the
Company will match the participants' contribution to purchase a
maximum of 750,000 common shares. The plan was activated in 2005
and $0.03 million was recorded as compensation expense and
8,546 restricted common shares were issued to employees during
the three months ended March 31, 2006. Common shares issued
under the share purchase plan are restricted for one year.

The Company has a share bonus plan for employees whereby a
maximum of 600,000 common shares may be awarded. The Company
awarded share bonuses totaling 3,000 shares for the three months
ended March 31, 2006 to non-executive board members and recorded
$0.03 million as compensation expense. The Company awarded
22,172 restricted common shares with a value of Cdn$0.2 million
in 2004 and 66,700 restricted common shares with a value of
Cdn$0.7 million in 2006 which are to be issued over a three-year
vesting period, of which 7,390 shares were issued and
$0.1 million was recorded as compensation expense for the
three months ended March 31, 2006.


6. SEGMENTED INFORMATION:
-------------------------------------------------------------------------

(a) The preliminary allocation of the Company's assets, liabilities,
revenue and expenses to the appropriate reporting segments
identified by the Company is as follows:

Exploration
and
March 31, Develop-
2006 Mali Ghana Botswana ment Corporate Total
-------------------------------------------------------------------------
Cash and gold
bullion $ 10,249 $ 1,866 $ 1,951 $ 119,257 $ 133,323
Other current
assets 31,187 15,976 627 1,180 48,970
Long-term
assets 101,489 153,243 149,220 69,661 473,613
Long-term
assets
related to
working
interests 148,576 148,576
-------------------------------------------------------------------------
$ 142,925 $ 148,576 $ 171,085 $ 151,798 $ 190,098 $ 804,482
-------------------------------------------------------------------------
Current
liabilities $ 21,263 $ 22,283 $ 4,493 $ 3,671 $ 51,710
Long-term
liabilities 11,921 68,060 21,658 13,730 115,369
-------------------------------------------------------------------------
$ 33,184 $ - $ 90,343 $ 26,151 $ 17,401 $ 167,079
-------------------------------------------------------------------------


Exploration
and
December 31, Develop-
2005 Mali Ghana Botswana ment Corporate Total
-------------------------------------------------------------------------
Cash and gold
bullion $ 7,958 $ 688 $ 101,551 $ 110,197
Other current
assets 30,547 385 2,160 33,092
Long-term
assets 102,007 962 70,805 173,774
Long-term
assets
related to
working
interests 151,922 151,922
-------------------------------------------------------------------------
$ 140,512 $ 151,922 $ - $ 2,035 $ 174,516 $ 468,985
-------------------------------------------------------------------------
Current
liabilities $ 15,867 $ 596 $ 12,299 $ 28,762
Long-term
liabilities 14,461 14,760 29,221
-------------------------------------------------------------------------
$ 30,328 $ - $ - $ 596 $ 27,059 $ 57,983
-------------------------------------------------------------------------



Three months Exploration
ended and
March 31, Develop-
2006 Mali Ghana Botswana ment Corporate Total
-------------------------------------------------------------------------
Revenues $ 42,751 $ 1,730 $ 44,481
Earnings from
working
interests 8,801 8,801
Operating
costs of
mine 18,654 20,375
Depreciation,
depletion
and
amortization 6,105 898 7,003
Exploration
expense 154 1,289 1,443
Other expense 1,906 14 2,806 3,005
Interest and
investment
expense
(income), net 312 (856) (544)
Income taxes 3,019 (870) 2,149
-------------------------------------------------------------------------
Net earnings
(loss) $ 12,601 $ 8,801 $ - $ (1,303) $ (248) $ 19,851
-------------------------------------------------------------------------


Three months Exploration
ended and
March 31, Develop-
2005 Mali Ghana Botswana ment Corporate Total
-------------------------------------------------------------------------
Revenues $ 27,230 $ 2,263 $ 29,493
Earnings from
working
interests 5,722 5,722
Operating
costs of
mine 17,487 17,487
Depreciation,
depletion
and
amortization 4,727 1,162 5,889
Exploration
expense 62 1,157 1,219
Other expense 135 (1) 1,798 1,932
Interest and
investment
expense
(income), net 768 (4) (86) 678
Income taxes 750 (483) 267
-------------------------------------------------------------------------
Net earnings
(loss) $ 3,301 $ 5,722 $ - $ (1,152) $ (128) $ 7,743
-------------------------------------------------------------------------

(b) The Company's share of mining asset additions at its joint
ventures for the three months ended March 31, 2006 is
$0.7 million (2005 - $3.4 million).

The preliminary allocation of the goodwill arising from the
acquisition of GGL to the Botswana and the exploration and
development reporting segments is $19.7 million and
$53.4 million respectively.

(c) The Company's $10.2 million share of cash at March 31, 2006
(December 31, 2005 - $7.9 million) in the joint ventures is not
under the Company's direct control. The Company's share of joint
venture cash flows for the period March 31, 2006 is as follows:

------------------------------------------------------------
Mar. 31, Mar. 31,
2006 2005
------------------------------------------------------------
Cash flows from (used in) operations $ 17,154 $ 8,724
Cash flows from (used in) financing (2,975) (4)
Cash flows from (used in) investments 1,490 (3,490)
------------------------------------------------------------


7. CONTINGENCIES AND COMMITMENTS:
-------------------------------------------------------------------------

In December 2005, an audit claim was received from the Department of
Taxation in Mali for additional taxes relating to the years 2003 and
2004 for the Sadiola and Yatela mines. Although mine management and
the joint venture partners dispute the claims, a provision of
$2.6 million for the full amount of the claim has been recorded in
the Company's accounts.

8. SUBSEQUENT EVENT:
-------------------------------------------------------------------------

On April 25, 2006, the Company closed a transaction with Battle
Mountain Gold Exploration Corp. ("BMGX") whereby the Company sold a
portfolio of gold royalties to that corporation. The portfolio
included royalties on the Williams, El Limon, Don Mario and Joe Mann
mines and the Dolores development project. Total consideration for
the sale was $21.9 million, consisting of $13.9 million in cash,
12 million common shares of BMGX valued at $6 million and a
$2.0 million debenture of a 100% owned subsidiary of BMGX convertible
into common shares of BMGX. The common shares carry certain
restrictions as to their resale. The debenture has a term of two
years, carries an interest rate of 6% and is convertible into BMGX
shares at a rate of $0.60 per share.

/T/

Contact Information

  • Joseph F. Conway
    President & Chief Executive Officer

    Grant A. Edey
    Chief Financial Officer
    Tel: (416) 360-4710
    North America Toll-Free: 1-888-IMG-9999
    Fax: (416) 360-4750