Ivernia Inc.
TSX : IVW

Ivernia Inc.

March 29, 2012 20:26 ET

Ivernia Reports Fourth Quarter and Year End 2011 Annual Financial Results

TORONTO, ONTARIO--(Marketwire - March 29, 2012) -

All Dollar Amounts are in U.S. Dollars ("US$") Unless Otherwise Indicated

Ivernia Inc. ("Ivernia" or the "Company") (TSX:IVW) today reported its fourth quarter and annual 2011 financial results. The Magellan Mine continued in care and maintenance throughout the fourth quarter of 2011 and did not ship any concentrate.

The Company recorded net income after tax of $10.9 million or $0.02 per common share for the fourth quarter of 2011, compared to $29.8 million or $0.10 per common share for the same period last year. The Company recorded a net loss after tax of ($18.6) million, or ($0.03) per common share, for the year ended December 31, 2011 compared with net income after tax of $37.2 million, or $0.18 per common share for 2010.

2011 FOURTH QUARTER AND ANNUAL HIGHLIGHTS

Financial

  • Gross loss of $3.4 million for the fourth quarter of 2011 and $23.3 million for the year ended December 31, 2011.
  • Net income after tax of $10.9 million for the fourth quarter of 2011. Net income after tax for the fourth quarter includes a foreign exchange gain of $11.2 million mainly related to Magellan Metals' functional currency being the Australian dollar ("A$") while Ivernia's reporting currency is the US$. The gain was as a consequence of the A$ strengthening against the US$ in the fourth quarter of 2011 with the US$/A$ rate increasing from 0.9744 on September 30, 2011 to 1.0250 on December 31, 2011. Of this foreign exchange gain, approximately $9.9 million is related to unrealized gains on Magellan Metals' intercompany loans denominated in US$ and Canadian dollars ("C$"). These intercompany loans are with wholly owned subsidiaries of the Company and are eliminated from the Statement of Financial Position on consolidation.
  • Net loss after tax of $18.6 million for the year ended December 31, 2011.
  • As at March 26, 2012, the Company had approximately $7.5 million in cash to fund ongoing care and maintenance activities at the Magellan Mine.
  • The Company will require further financing to fund the ongoing care and maintenance and restart of the Magellan Mine. The amount of funding required will be dependent on the timing and content of final operating conditions to be issued by the Minister for Environment of Western Australia (the "Minister") as well as prevailing market conditions at that time.
  • On March 29, 2012, the Company received a comfort letter from Sentient confirming its commitment to provide funding to Enirgi Group Corporation ("Enirgi Group"), to allow Enirgi Group, in turn, to provide financing to Ivernia up to an aggregate of $10 million, if, as and when needed, during the period ending March 31, 2013.
  • The Company holds approximately 10,100 tonnes of lead carbonate concentrate inventory with a carrying value of $7.9 million as of December 31, 2011. Magellan Metals will not be in a position to ship the inventory until it has been issued its final operating conditions by the Minister and completes all required actions to be able to recommence transportation of lead carbonate concentrate.
  • During the year, the Company issued 215.6 million common shares in three separate private placement financings for net total proceeds of C$42.0 million. The most recent private placement closed in December 2011 and 69.4 million common shares were issued for net total proceeds of C$5.9 million.

Operational

  • In March 2011, the Company reported a significant increase in the mineral reserves (an increase of 76% in contained lead metal) and mineral resources (an increase of 45% in contained lead metal) from the mineral resources and mineral reserves stated as of December 31, 2009.
  • In March 2011, Magellan Mine recorded a record monthly mill throughput of 127,000 tonnes of ore.
  • In April 2011, the detection of lead bearing mud on the bottom of a few shipping containers, ultimately resulted in the operations being voluntarily placed in care and maintenance and the Company undertaking an end-to-end review of Magellan Metals' risk management and compliance systems.
  • Magellan Metals provided submissions to the Office of the Environmental Protection Authority ("OEPA") and Minister on the future operating conditions for the Magellan Mine.
  • On October 3, 2011 the Environmental Protection Authority of Western Australia ("EPA") released its report to the Minister entitled Section 46 Report and Recommendation of the Environmental Protection Authority (the "Section 46 Report").
  • The Section 46 Report included the EPA's recommended operating conditions for any future operations at the Magellan Mine and transportation of lead carbonate concentrate from the Magellan Mine (the "Draft Recommended Conditions"). The Company and Enirgi Group, the Company's major shareholder, are having constructive and regular discussions with the Minister and his staff with respect to the timing and content of the final operating conditions. The Company believes progress is being made in these discussions, but cannot at the date hereof, provide guidance on the timing of the issuance of the final operating conditions by the Minister nor on their content.
  • The Company does not expect to be in a position to make a decision on restarting the Magellan Mine until after the Minister issues the final operating conditions and Magellan Metals completes a review of these final operating conditions and their potential impact on any restart plans.
  • During 2011, the Company substantially completed the internal end-to-end review of the effectiveness of Magellan Metals' risk management and compliance systems.

FINANCIAL AND OPERATING HIGHLIGHTS

The following table is a summary of Ivernia's financial and operating highlights for the three months and years ended December 31, 2011, 2010 and 2009:

Three months ended December
31,
Year ended December
31,
(in thousands of United States dollars, unless otherwise indicated and per share amounts) 2011 2010 2009(3) 2011 2010 2009(3)
$ $ $ $ $ $
Financial Highlights
Revenue(1) - 36,969 16,904 11,272 97,492 25,172
Operating costs (1,859 ) (26,054 ) (13,823 ) (29,572 ) (88,107 ) (20,854 )
Inventory (write-down) recovery (1,346 ) 251 - (3,361 ) 1,729 4,188
Amortization (189 ) (4,062 ) (387 ) (1,637 ) (6,152 ) (887 )
Gross (loss) profit (3,394 ) 7,104 2,694 (23,298 ) 4,962 7,619
General and administrative (2,285 ) (2,423 ) (1,757 ) (9,468 ) (8,465 ) (6,850 )
Severance costs - - - (1,127 ) - -
Esperance/Fremantle and related costs - - (15 ) - - (1,293 )
Net interest (expense) income 130 (586 ) (888 ) 589 (2,717 ) (2,812 )
Accretion (151 ) (558 ) (734 ) (677 ) (2,030 ) (4,231 )
Stock option costs (475 ) (31 ) (37 ) (826 ) (145 ) (75 )
Debt settlement expense - - - - - (753 )
Foreign exchange and other expenses 11,164 14,991 646 (63 ) 31,281 277
8,383 11,393 (2,785 ) (11,572 ) 17,924 (15,737 )
Income (loss) before income taxes 4,991 18,497 (91 ) (34,870 ) 22,886 (8,118 )
Deferred income tax 5,871 11,309 6,004 16,230 14,300 4,814
Net income (loss) 10,862 29,806 5,913 (18,640 ) 37,186 (3,304 )
Basic (loss) earnings per share (2) 0.02 0.10 0.03 (0.03 ) 0.18 (0.02 )
Fully diluted (loss) earnings per share (2) 0.02 0.10 0.01 (0.03 ) 0.18 (0.02 )
Weighted average shares outstanding - thousands 693,103 310,102 180,548 640,556 210,115 180,252
Unrealized gain (loss) on investment - 46 - (77 ) 133 (4 )
Foreign currency translation differences (4,811 ) (5,938 ) - 722 (10,333 ) -
Comprehensive income (loss) 6,051 23,914 5,913 (17,995 ) 26,986 (3,308 )
Cash provided by (used in) operations before
changes in non-cash working capital (5,110 ) 8,079 530 (28,619 ) 900 (8,287 )
Cash flow provided by (used in) operating activities (5,880 ) 7,650 6,038 (36,732 ) 9,646 (2,946 )
Operating Highlights
Ore milled - (000's tonnes) - 316 - 161 874 -
Average head grade - (% lead) - 6.9 - 6.9 6.8 -
Recovery - (%) - 78 - 73 74 -
Concentrate produced - (000's dry tonnes) - 25.9 - 12.7 68.0 -
Concentrate sold - (000's dry tonnes) - 23.5 11.3 7.6 71.3 20.1
Lead metal in concentrate produced - (000's tonnes) - 16.9 - 8.1 44.1 -
Lead metal in concentrate sold - (000's tonnes) - 15.3 7.3 4.9 46.2 12.8
Concentrate inventory - (000's of dry tonnes) 10.1 5.1 9.2 10.1 5.1 9.2
Average lead price - LME cash settlement- ($ per pound)
0.90

1.08

1.05

1.09

0.97

0.79
Ivernia's average lead sale price - ($ per pound) - 1.19 1.10 1.13 1.04 0.94
Cash cost per pound sold - ($ per pound)(4) N/A N/A N/A N/A N/A N/A
(1) Ivernia restarted operations at the Magellan Mine in late February, 2010. A ramp-up of operations took place throughout 2010. On April 5, 2011 Magellan Metals voluntarily ceased transportation and operations as result of the detection of lead bearing mud on one of its shipping containers. With the uncertainty surrounding these results and what was the third transportation disruption since December 31, 2010 the decision was made to undertake an end-to-end review of its business practices before the recommencement of transportation would resume. As such, the Magellan Metals workforce commenced an orderly shutdown of operations and the mine was placed on full care and maintenance in April 2011. The Magellan Mine remains on care and maintenance as at March 29, 2012.
(2) Per share data was calculated on the basis of the weighted average shares outstanding (basic and diluted) for the relevant period.
(3) 2009 financial statements were prepared under Canadian Generally Accepted Accounting Principles, have not been converted to IFRS and may not be comparable.
(4) Cash cost per pound sold is a non-IFRS measure. Cash cost of lead sold is not currently meaningful as the Magellan Mine worked through the issues surrounding the Order, transportation delays and then care and maintenance during 2011. Upon the restart of operations of the Magellan Mine and once the Magellan Mine achieves steady state production run rates information about the cash cost of lead sold will be reintroduced.

OPERATIONS REVIEW - MAGELLAN MINE

Ivernia restarted operations at the Magellan Mine in late February, 2010. A ramp-up of operations took place throughout 2010. On December 31, 2010 Magellan Metals received a stop order from the Acting Minister for Environment of Western Australia (the "Stop Order") relating to the transport of lead carbonate concentrate from the Magellan Mine. Transportation operations from the Magellan Mine were immediately halted upon receipt of the Stop Order. The Stop Order was replaced by a subsequent order issued on January 3, 2011 from the Minister (the "Order") with respect to cessation of transportation of lead carbonate concentrate from the Magellan Mine. Magellan Metals stopped mining and processing operations at the Magellan Mine commencing January 5, 2011 until February 23, 2011 when the Minister announced the lifting of the Order. Following the lifting of the Order, Magellan Metals commenced a ramp up of operations. On April 5, 2011 Magellan Metals announced that it had voluntarily ceased transportation and operations as a result of the detection of a small amount of lead bearing mud on the outside of one of its shipping containers at the Port of Fremantle. On April 7, 2011 the Company announced that it had commenced placing the Magellan Mine on care and maintenance.

There was no production or sales of lead carbonate concentrate in the fourth quarter of 2011. For the year ended December 31, 2011, the Company produced approximately 12,700 dry metric tonnes of lead carbonate concentrate containing approximately 8,100 tonnes of contained lead metal. For the year ended December 31, 2011, the Company sold approximately 7,600 dry metric tonnes of lead containing approximately 4,900 tonnes of contained lead metal. At the time that the transport operations were stopped in April there were approximately 10,100 tonnes of lead concentrate on site at an estimated average concentrate grade of 64% lead, containing approximately 6,450 tonnes of lead. This concentrate remains stored in sealed bags and protected from the weather. Prior to the recommencement of any shipping operations, the cleanliness and integrity of all bags will be verified.

Principal activities during the fourth quarter of 2011 focused on: advancing the internal end-to-end review of Magellan Metals' risk management and compliance systems; providing its views to the Western Australian Government in regards to its future operating conditions and the potential for downstream processing; and completion of Magellan Metals' internal inquiry into the source and extent of lead bearing mud that was found on certain shipping containers. A key focus of these activities is to ensure enhanced systems and procedures are put in place to prevent a reoccurrence of such incidents in the future and to identify a robust, sustainable business model that will deliver uninterrupted operations upon restart.

On October 3, 2011, the EPA released the Section 46 Report to the Minister detailing the Draft Recommended Conditions. The Draft Recommended Conditions contain recommended changes to the interim implementation conditions issued by the Minister on February 23, 2011 that currently govern the Magellan Mine's operations (the "Interim Implementation Conditions"). In addition, the Draft Recommended Conditions contain recommended conditions that must be satisfied prior to the recommencement of transportation of any lead carbonate concentrate from the Magellan Mine. In the Section 46 Report the EPA stated: "…that the current transport and handling methods are more than sufficient to protect human health and the environment" and that "[t]he transportation of the bulk bags in shipping containers is over and above what is required and is best practice". Further, while the EPA stated that: "…the conditions placed on Magellan are much stricter than would normally be required for the transport and monitoring of this type of product", the Draft Recommended Conditions, in general, recommend preserving and, in some cases, enhancing the already strict auditing, monitoring and reporting requirements currently imposed on Magellan Metals pursuant to the Interim Implementation Conditions. As of the date hereof, the Section 46 Report and the Draft Recommended Conditions are currently under consideration by the Minister.

The Company cannot, at this time, provide any specific guidance on when the Company will restart operations at the Magellan Mine. The Company does not expect to be in a position to make a decision on restarting the Magellan Mine until after the Minister issues the final operating conditions and Magellan Metals completes a review of these final operating conditions and their potential impact on any restart plans. The Company has provided its input to the Minister on the Section 46 Report and is therefore awaiting the release of its final operating conditions. As of the date hereof, the Company and Enirgi Group, the Company's major shareholder, are having constructive and regular discussions with the Minister and his staff with respect to the timing and content of the final operating conditions. While the Company believes progress is being made in these discussions, at the date hereof, it cannot provide guidance on the timing of the issuance of the final operating conditions by the Minister nor on their content. The length of time between making the decision to restart the Magellan Mine and the actual commencement of operations at the Magellan Mine may be affected by several factors, including the content of the final operating conditions and pre-operational ramp-up. For instance, the final operating conditions may require that Magellan Metals complete certain actions prior to the recommencement of transportation from the Magellan Mine (see Section 46 Inquiry and Review of Magellan Mine Operating and Transport Conditions below). In addition, following a decision to restart and prior to commencing a restart of operations at the Magellan Mine, Magellan Metals would need to undergo a significant recruiting and training effort. Once the restart of the Magellan Mine has commenced, the Company expects that it would take greater than six months of operations before the mine and processing plant would be operating at full production levels.

A full discussion of the events for the three year period to March 29, 2012 is contained in the Company's annual information form dated March 29, 2012 (the "2011 AIF") under the heading "Three-Year History - Operations". The 2011 AIF is available on the Ivernia web site at www.ivernia.com and on SEDAR at www.sedar.com.

The table below summarizes quarterly and annual mine production, process plant production, shipments and inventories for the year ended December 31, 2011.





Three months
ended
March 31, 2011




Three months
ended
June 30, 2011



Three months
ended
September 30,
2011



Three months
ended
December 31,
2011




Year ended
December 31,
2011
Mining
Ore mined - 000's tonnes(1) 150 24 - - 174
Low grade ore mined - 000's tonnes(2) 34 8 - - 42
Total ore and waste mined - 000's bcm 264 52 - - 316
Processing
Ore milled - 000's tonnes 145 16 - - 161
Average head grade - % lead 6.8 7.1 - - 6.9
Average recovery - % 74 71 - - 73
Concentrate produced - 000's drytonnes
11.4

1.3
-
-

12.7
Concentrate grade - % lead 64 63 - - 64
Lead metal in concentrate produced -000's tonnes
7.3

0.8
-
-

8.1
Sales and inventories
Concentrate sold - 000's dry tonnes 3.9 3.7 - - 7.6
Concentrate grade - % lead 64 65 - - 65
Lead metal in concentrate sold - 000'stonnes
2.5

2.4

-

-

4.9
Concentrate inventory - 000's drytonnes
12.6

10.1

10.1

10.1

10.1
(1) Ore mined does not include low grade ore
(2) Low grade ore is 1.5 to 2.5% lead

Developments Related to the Magellan Mine

Ivernia restarted operations at the Magellan Mine in late February, 2010. A ramp-up of operations took place throughout 2010 and mining and processing operations continued to January 5, 2011, when a temporary shutdown described above was commenced. Mining and processing operations recommenced following an announcement by Ivernia of February 23, 2011 of the lifting of the Order and continued until shortly after a further announcement by the Company on April 5, 2011, stating that all transportation had been voluntarily halted and an orderly shutdown of operations had commenced.

During the current care and maintenance period, the mine and processing plant have been maintained in a state of readiness for a restart of operations and on the basis of minimizing the amount of time required for a ramp-up of operations to full production levels. All process vessels have been drained, flushed and inspected with minor repairs conducted and the process vessels then refilled with water to prevent corrosion. All major equipment including mills, motors, pumps and agitators are operated on a routine basis to ensure that they are in good working order. Power supply has been rationalized in line with reduced power requirements. At the start of the care and maintenance period, all haul roads were secured. The mine has remained in a geotechnically stable condition throughout the care and maintenance period.

Since entering the care and maintenance period, Magellan Metals has substantially completed its internal comprehensive end-to-end review of all its compliance activities and response systems related to the Magellan Mine, including the mining, processing, transporting and management of lead carbonate production and export functions with the final review expected to be completed upon receipt of final operating conditions from the Minister. The objective of the end-to-end review is to prevent an ongoing pattern of temporary disruptions to operations and to further reduce risks associated with the wide range of potential events that can impact on compliance with what the Company believes are the most stringent transport conditions placed on any Western Australian mining operation.

During the fourth quarter of 2011, the Company delivered to the OEPA an internal report on its inquiry into the source and extent of lead bearing mud on containers that precipitated the Magellan Mine entering care and maintenance in April 2011. The inquiry identified that interruptions to Magellan Metals' normal transport routine from late December 2010 to March 2011 resulted in containers being stored at Magellan Metals' Wiluna mine site and the Leonora rail yard for extended and much longer than usual periods. During this time exceptionally heavy rain resulted in mud and water runoff accumulating in areas where containers were stored and mud contacting the containers. Subsequent extremely hot temperatures dried the mud and hardened it on the base of the containers. Attempts to physically sample the mud during the inquiry indicated that the mud was hard baked and required vigorous physical scraping to remove.

These conditions had not previously been encountered during Magellan Metals' sealed, double lined bags in locked shipping container transport process, and risk assessments had not identified this as being a foreseeable risk from the container handling, storage and transport process. The risk of mud baking hard onto containers was therefore not regulated or controlled by the Company's operating conditions and/or the Health, Hygiene, Environmental Monitoring Program that regulates Magellan Metals' transport operations.

Independent inspection of the containers prior to leaving the Magellan Mine did not report or identify the mud they observed on containers as an issue.

The mud on the containers is likely to have come from more than one source, and include mud from both the Magellan Mine at Wiluna and the Leonora rail yard. At least some of the lead in the mud originated from the Magellan Mine at some time, most likely from operations in the period 2005 to 2007 when lead carbonate concentrate was transported in covered kibbles via the Leonora rail yard. Naturally occurring lead and lead from historical mining and transport operations via the Leonora rail yard may have also contributed.

There is no evidence that the source of the lead in the mud was from the double lined bagged lead carbonate concentrate within the locked shipping containers. At no time was there was any risk from the mud on the containers, or its removal, to public safety or to the environment.

Based on the results to date of the Company's end-to-end review and the findings from the Company's internal inquiry into the source and extent of lead bearing mud on containers, the Company has identified a number of minor capital projects, risk reduction exercises, management plan redrafting and internal training exercises that it will undertake prior to restarting operations.

The Company will continue its internal planning process for a restart of operations; however, as previously mentioned, no decision on a restart of operations will be made until final operating conditions are issued by the Minister. A successful restart will be dependent on ensuring key personnel are in place. The care and maintenance team was carefully selected to ensure core skills were retained to allow for an efficient restart and the care and maintenance personnel are expected to fill key managerial, supervisory and staff roles in processing, maintenance, OHS&E, finance and logistics.

Section 46 Inquiry and Review of Magellan Mine Operating and Transport Conditions

Pursuant to the EP Act, the Interim Implementation Conditions remain in place pending a full inquiry and review of Magellan Metals' operating conditions by the EPA pursuant to section 46 of the EP Act (the "Section 46 Review") and the release of operating conditions from the Minister. The full text of the Interim Implementation Conditions is posted on the Magellan Metals website at www.magellanmetals.com.au.

As part of working with the EPA on its Section 46 Review, Magellan Metals made submissions throughout the year to the OEPA with respect to proposed amendments to the Health, Hygiene and Environmental Management and Monitoring Programs and the Interim Implementation Conditions. In May 2011, officers of the OEPA attended the Magellan Mine site to observe how Magellan Metals receives, stores, loads and washes containers to prevent concentrate and mud from leaving the site.

On October 3, 2011, the EPA released the Section 46 Report detailing the Draft Recommended Conditions that it proposed should replace the Interim Implementation Conditions that govern operations and transport from the Magellan Mine. The Section 46 Report is available on the EPA website. A link to the Section 46 Report, which includes the Draft Recommended Conditions, can be found on the Magellan Metals' website at: www.magellanmetals.com.au/compliance/ministerial-conditions.aspx.

As mentioned above, the Interim Implementation Conditions remain in place pending the Minister's consideration of the Section 46 Report and Draft Recommended Conditions resulting from the full inquiry and review of Magellan Metals' operating conditions by the EPA pursuant to the Section 46 Report.

The Section 46 Report provides the EPA's recommendations on Magellan Metals' operating conditions for the Minister's consideration. The Minister will now consider the Section 46 Report and decide on the final content of Magellan Metals' operating conditions.

If adopted and issued by the Minister in their current form, the Draft Recommended Conditions would change the Interim Implementation Conditions including by adding conditions that must be satisfied prior to the recommencement of transportation of any lead carbonate concentrate from the Magellan Mine. The Draft Recommended Conditions, in general, preserve and, in some cases, enhance the already strict auditing, monitoring and reporting requirements currently imposed on Magellan Metals.

If adopted and issued by the Minister in their current form, the Draft Recommended Conditions require that Magellan Metals provide the OEPA with a report from an acceptable independent expert summarizing the environmental impacts and parameters of downstream processing options including smelting lead into ingots. While the Company has not changed its historical position with respect to the feasibility of a smelter or refinery, in June 2011, the Company commenced a new study into the viability of downstream processing of its concentrates given the significant increase in mineral reserves at Magellan in 2011, the changing lead concentrate market and improved economic climate since the last review was completed in 2008. In January 2012, the Company delivered its preliminary findings to the OEPA and the Minister which demonstrates that at current lead prices and exchange rates downstream processing at the Magellan Mine remains uneconomic. The findings are preliminary as they require further studying of the environmental impact of a downstream processing facility by the Company.

The Company cannot provide any guidance on the content or timing for the finalization of the Minister's review and issuance of the final operating conditions nor can the Company provide any guidance whether the final operating conditions will be materially different from the Draft Recommended Conditions.

Capital Resources and Working Capital Requirements

As at March 26, 2012 the Company had approximately $7.5 million in cash to fund ongoing care and maintenance activities at the Magellan Mine and any costs associated with the restart of the Magellan Mine, if and when a restart decision is made. The Company expects to continue to have negative cash flows during the care and maintenance period. These negative cash flows may be offset by any revenue generated from the sale of stockpiled lead carbonate concentrate held at the Magellan Mine. However, Magellan Metals does not expect to be able to commence the shipping of stockpiles prior to the release of the final operating conditions by the Minister. Further, the final operating conditions, once issued, may require that Magellan Metals fulfill certain conditions to the satisfaction of the regulators prior to the recommencement of transportation of lead carbonate concentrate from the Magellan Mine. Accordingly, the Company cannot provide any guidance on the timing for the shipment of stockpiles from the Magellan Mine.

On March 29, 2012, the Company received a comfort letter from Sentient confirming its commitment to provide funding to Enirgi Group, to allow Enirgi Group, in turn, to provide financing to Ivernia up to an aggregate of $10 million, if, as and when needed, during the period ending March 31, 2013 (the "Enirgi Commitment").

The Company expects that it will likely require additional financing to restart the Magellan Mine, in excess of current cash balances, the Enirgi Commitment and any proceeds it may receive from the shipment of lead carbonate concentrate stockpiles. The quantum of this funding requirement cannot be estimated at this time and will be contingent on the timing of the receipt of final operating conditions from the Minister, the content of those final operating conditions (including any conditions required to be completed to the satisfaction the regulators before recommencing transportation and operations), net proceeds received from the sale of stockpiles, as well as general market conditions, including but not limited to lead prices, foreign exchange and capital markets. If the Company was unable to secure this additional financing, the Company may be unable to restart the Magellan Mine which, in turn, could affect its future ability to continue as a going concern.

Management's Discussion and Analysis and Consolidated Financial Statements

Ivernia's audited financial statements and management's discussion and analysis for the three months and year ended December 31, 2011 were filed today and will be available on the Ivernia website at www.ivernia.com or SEDAR at www.sedar.com.

About Ivernia

Ivernia is an international base metal mining company and the owner of the Magellan Mine, located in Western Australia.

Ivernia trades under the symbol "IVW" on the Toronto Stock Exchange. Additional information on Ivernia is available on the Company's website at www.ivernia.com and at SEDAR at www.sedar.com.

Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking information within the meaning of securities laws. All statements included herein (other than statements of historical facts) which address activities, events or developments that management anticipates will or may occur in the future are forward-looking statements, including statements as to the following: the duration of the suspension of the Company's transportation of lead carbonate from the Magellan Mine, the duration of the period of care and maintenance commenced in April 2011, future targets and estimates for production, capital expenditures, operating costs, cash costs, mineral resources, mineral reserves, life of mine, recovery rates, grades and prices, business strategies and measures to implement such strategies, competitive strengths, estimated goals and plans for Ivernia's future business operations, lead market outlook and other such matters. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "contemplate", "target", "believe", "plan", "estimate", "expect", and "intend" and statements that an event or result "may", "will", "can", "should", "could" or "might" occur or be achieved and other similar expressions. These statements are based upon certain reasonable factors, assumptions and analyses made by management in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. However, whether actual results and developments will conform with management's expectations is subject to a number of risks and uncertainties, including factors underlying management's assumptions, such as, finalization and content of Magellan Metals' final operating conditions, the duration of the suspension of the Company's transportation of lead carbonate from the Magellan Mine, the duration of the period of care and maintenance commenced in April 2011, the timing and need for additional financing, risks relating to the operations being placed on care and maintenance, matters relating the restart of mining and milling operations, matters relating to ramping up mining and milling throughput and operations, regulatory compliance and approvals, metal price volatility, lead carbonate concentrate treatment charges, exchange rates, regulatory proceedings and litigation, the fact that the Company has a single mineral property, resources and reserves, health and safety, environmental factors, mining risks, metallurgy, labour and employment regulations, government regulations, insurance, dependence on key personnel, constraints on cash flow, the nature of mineral exploration and development, matters relating generally to the transportation of lead carbonate, presence of a majority shareholder, matters related to public opinion, matters related to the Esperance settlement and shipments through the Port of Fremantle, and common share price volatility and the dilution of the Company's common shares. Additional factors and considerations are discussed in the Company's 2011 AIF and may be included in other documents filed from time to time by Ivernia with Canadian securities regulatory authorities. While Ivernia considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. These factors may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and there can be no assurance that the actual results or developments anticipated by management will be realized or, even if substantially realized, that they will have the expected results on the Company. Undue importance should not be placed on forward-looking information nor should reliance be placed upon this information as of any other date. Except as required by law, while it may elect to, Ivernia is under no obligation and does not undertake to update this information at any particular time.

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