Medoro Resources Ltd.
TSX : MRS

Medoro Resources Ltd.

November 10, 2010 09:16 ET

Medoro Announces 2010 Third Quarter Financial Results

TORONTO, ONTARIO--(Marketwire - Nov. 10, 2010) -

All amounts are in Canadian dollars, unless otherwise stated.

Medoro Resources Ltd. (TSX:MRS) announced today the release of its unaudited consolidated financial results for the three and nine month periods ended September 30, 2010 ("Q3 2010"). The Company's consolidated financial statements for the three and nine months ended September 30, 2010, together with its Management's Discussion and Analysis of these results, are available for review on the Company's website at www.medororesources.com and under the Company's profile at www.sedar.com.

All numbers presented in this press release reflect the recent consolidation of the common shares in the capital of Medoro on a three-for-one basis, which became effective on August 4, 2010.

For Q3 2010, Medoro reported a net loss of $3.9 million or $0.03 per share compared to a net loss of $2.7 million or $0.02 per share in the previous quarter ("Q2 2010"). The increase in net loss in Q3 2010 over Q2 2010 is primarily associated with an increase in administrative expenses incurred due to employment-related costs as well as the foreign exchange loss related to the effect of the appreciation of the Colombian Peso and the Venezuelan Bolivar against the Canadian dollar due to the Company's future income tax liability denominated in these foreign currencies. 

As at September 30, 2010, the Company had $20 million net working capital, including cash and short-term investments of $30.8 million and no debt. Revenues for Q3 2010 were $6.8 million, compared with nil for the three months ended September 30, 2009 ("Q3 2009").

The revenues in Q3 2010 were entirely due to Mineros Nacionales, which was acquired by the Company effective February 15, 2010. Mineros Nacionales owns the Zona Baja license at the Marmato Project and operates the Mineros Nacionales underground gold mine. For the three months ended September 30, 2010, the Mineros Nacionales mine produced 5,814 ounces of gold and 9,678 ounces of silver. The weighted average cash cost1 per ounce of gold produced was approximately US$926, net of silver by-product credits. During the three month period ended September 30, 2010, Mineros Nacionales sold 5,318 ounces of gold at a weighted average price of US$1,217 per ounce and 8,919 ounces of silver at a weighted average price of US$18.63 per ounce.

The Company's primary focus is on Colombia where it has rapidly and successfully implemented its strategy to consolidate the historically prolific gold producing area of Marmato. In the fourth quarter of 2010, the Company will continue with its primary focus: the exploration, development and mining operations of its now unified Marmato Project, with the goal of developing the Marmato deposit into a bulk tonnage mine. As a result of the significant in-fill drilling program to date, Medoro also expects to update its resource estimate for the Marmato Project within the fourth quarter of 2010.

(1) Non-GAAP Measures

This news release refers to cash cost per ounce of gold produced because certain investors may use this information to assess the Company's performance and also determine the Company's ability to generate cash flow for investing activities. This measurement captures all of the important components of the Company's production costs. In addition, management utilizes this metric as an important management tool to monitor cost performance of the Company's operations. This measurement has no standardized meaning under Canadian generally accepted accounting principles ("Canadian GAAP") and is therefore unlikely to be comparable to similar measures presented by other companies. This measurement is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with Canadian GAAP.

About Medoro Resources Ltd.

Medoro Resources Ltd. is a gold exploration, development and mining company with a primary emphasis on Colombia. The Company operates the producing Mineros Nacionales gold mine located in Zona Baja at Marmato and is conducting an exploration and in-fill drilling program at its Marmato Project to upgrade and expand its gold resources there. Medoro also has a 5% interest in the Frontino Gold Mines with an option to increase its interest to 50%.

Medoro also holds a 100% interest in the Lo Increible 4A and 4B concessions in Venezuela where it is continuing its efforts to obtain an exploitation permit to allow development of these gold properties when circumstances in Venezuela allow. Medoro owns interests in gold exploration properties in Mali in respect of which it is seeking possible joint venture partners to further explore these properties.

Additional information on Medoro Resources Ltd. can be found on the Company's website at www.medororesources.com and by reviewing the Company's profile on SEDAR at www.sedar.com.

FORWARD-LOOKING INFORMATION

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of Medoro and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Medoro to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and Medoro disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

Contact Information

  • Medoro Resources Ltd.
    Peter Volk
    Vice President & General Counsel
    (416) 603-4653
    or
    Medoro Resources Ltd.
    Greg DiTomaso
    Investor Relations
    (647) 436-2592
    www.medororesources.com