Pacific Iron Ore Corp.
TSX VENTURE : POC

Pacific Iron Ore Corp.

May 29, 2009 12:40 ET

Pacific Iron Ore Corporation Announces Addition of Key Personnel and Release of March 31, 2009 Financial Statements and Management Discussion and Analysis

CALGARY, ALBERTA--(Marketwire - May 29, 2009) - Pacific Iron Ore Corporation (TSX VENTURE:POC), announces that it has filed its Financial Statements and Management Discussion and Analysis for the three months ended March 31, 2009 and 2008. These documents are now available on SEDAR.

Pacific Iron Ore Corporation ("POC" or the Corporation") also announces that today its Board of Directors has appointed Mr. Jeffery Austin P.Eng. to the office of President of the Corporation. Mr. Todd Montgomery, who continues as a director and Chief Executive Officer of Pacific Iron Ore Corporation, stated that "the Corporation is indeed fortunate to have Mr. Austin join its management team. The success of the 2008 Exploration Program, the identification of a significant resource base and the Corporation's expansion of its exploration efforts in 2009 has required the addition of the skills Mr. Austin processes."

Mr. Jeffrey B. Austin is a professional engineer based in Kelowna, British Columbia. In addition to his current position as a director and President of Pacific Iron Ore Corporation, Mr. Austin works as a consultant metallurgist specializing in assisting feasibility studies and new project commissioning and he is the president of Western Canada Limestone Ltd. of Kelowna. Mr. Austin has extensive experience in the commissioning of new mines and has supported several hundred project studies in the last 25 years. He received a Bachelor of Applied Science from the University of British Columbia in 1984, and has been registered as a professional engineer since 1987.

The Corporation's 2009 Exploration Program of approximately $2.0 million will exceed the Corporation's remaining flow through obligations and will focus on expanding the diamond drill program commenced in 2008 on the Pearson Project located on Vancouver Island and commence exploration activities on a number of its claims located in Ontario.

2009 Results

During the first three months of 2009 the Corporation generated interest revenue of $4,267, incurred a net loss before income taxes of $115,729 and generated a net income of $220,971 or $0.00 per common share. The net income arose as the Corporation was able to recognize the future income tax benefit of income tax losses carried forward to offset future income tax liabilities arising during the period.

Its major expenses included general and administrative costs of $53,325, stock based compensation expenses of $50,821 and the write-down of mineral properties surrendered by the Corporation of $16,100. The Corporation also received the benefit of recognizing future income tax recoveries of $336,700 during the quarter.

General and administrative expenses totaled $53,325 in the first three months of 2009 as compared to $41,712 in the same period of 2008, an increase of $11,613. In 2008, the major categories of expenditure included:

- Legal and accounting fees $12,482 ($17,905 in 2008). The increase in these expenses were associated with daily accounting activities, filing of tax returns, consulting services provided in the preparation of interim statements and regulatory filings and general corporate advisory services. Also see disclosures with respect to related party transactions.

- Investor relations, corporate communication and security exchange fees totalling $6,837. No similar charges were incurred in 2008 as the Corporation's common shares were not traded on a public market.

- Travel costs of $1,082 ($5,458 in 2008) incurred in transporting staff, advisors and investors to the Corporation's principal mining properties.

- Consulting costs of $9,000 ($3,000 in 2008) relating to general management services provide to the Corporation which did not pertain to exploration or financial services.

- Office, insurance, rent and utility expenses of $10,163 ($5,973 in 2008) which increased as a result of establishing a site office in Port Renfrew, British Columbia as well as in Kenora, Ontario.

- Interest expenses and bank charges (including Part XII tax) totalled which $8,304 ($1,201 in 2008). Included in interest charges is $1,038 with respect to related parties ($1,282 in 2008).

- Amortization of equipment of $4,218 ($1,766 in 2008).

- Other costs of $1,239 ($6,409 in 2008) related to the administration of the Corporation.

In light of current economic conditions and after completing a thorough evaluation of the Corporation's capital resources and the 2008 Exploration Program, the Corporation decided to focus its future exploration activities on the high potential mineral claims identified in Ontario and on Vancouver Island. As a result a number of claims no longer exhibited sufficient qualities and resource potential to warrant further exploration. Consequently, claims not material to the Corporation's prospects have been surrendered by the Corporation thus reducing the annual expenditures required to maintain the claims.

During the first quarter of 2009 the Corporation incurred $347,510 in capital expenditures as compared to $246,637 for the same period in 2008. In 2009 the Corporation incurred $160,675 ($243,927 in 2008) with respect to acquisition, staking, recording and filing costs associated with its British Columbia and Ontario properties and $87,790 ($159,685 in 2008) on deferred exploration costs, principally in British Columbia. Deposits on future exploration expenditures totaled $14,322 in 2009 ($nil in 2008). Miscellaneous equipment purchases in 2009 and changes in working capital associated with exploration activities accounted for the remaining capital expenditures.

Exploration efforts are curtailed in the first four months of the year due to site access restrictions and poor weather conditions.

Liquidity

Pacific Iron has historically relied upon advances from its shareholders and the equity capital markets to raise sufficient funds to finance its mineral property acquisitions and exploration programs. In 2009 the Corporation began the year with a cash balance of $2,174,847 and working capital of $181,992, excluding cash. During the period, Pacific Iron repaid advances from its shareholders totaling $10,000 and set aside $15,645 in cash balances to secure exploration permits in British Columbia and Ontario. The Corporation also invested $347,510 into its exploration program. As of March 31, 2009 the Corporation has a cash and short term deposit balance of $1,947,390 and a working capital surplus, excluding cash and short term deposits, of $78,844 to fund its future activities, flow through obligations of $1,559,108 and repay shareholder advances.

Quality Control of Reported Results

The Pearson Project drilling program and aerial magnetic survey are being undertaken pursuant to the recommendations contained in the independent qualifying report dated October 31, 2007 and revised on February 13 and March 11, 2008 entitled "Technical Report - Pearson Project, British Columbia" (the "Qualifying Report") prepared by an independent geologist, Mr. George Owsiacki, P. Geo. of Victoria, British Columbia. The Qualifying Report was prepared in contemplation of the requirements of National Instrument 43-101. A copy of the 43-101 Technical Report is available under the Corporations profile on SEDAR and can be accessed at www.sedar.com.

Mr. Garry Payie, P. Geo of Victoria, British Columbia, an independent geological consultant, is the Qualified Person on the Pearson Project under the guidelines of NI 43-101. Mr. Payie oversees the Corporation's exploration program with respect to the Pearson Project and has reviewed and approved the technical disclosure contained in this press release relating to that project.

Corporate Direction and Strategy

Pacific Iron Ore Corporation is dedicated to the development of its iron ore deposits, located in the Port Renfrew area of Vancouver Island, British Columbia. With the success of the 2008 Exploration Program and the existence of sufficient capital resources to undertake additional exploration activities in 2009 the Corporation is well positioned to manage these difficult times. In order to maximize the returns on future exploration activity, the Corporation has initiated a detailed review of its claims located on Vancouver Island and in Ontario, with the intention of identifying other areas with similar potential to the Pearson Project.

For further information please refer to the Corporations profile on SEDAR which can be accessed at www.sedar.com or visit our website at www.pacificironorecorp.com.

Forward Looking Statements:

The TSX V Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This release includes certain statements that may be deemed "forward looking statements". All statements in this release, other than statements of historical facts, that address future production, reserves potential, exploration drilling, exploration activities and events or developments that the Corporation expects are forward looking statements. Although the Corporation beliefs the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements. Factors that could cause results to differ materially from those in the forward looking statements include, but are not limited to: market prices; exploitation and exploration successes; continued availability of capital, financing and personnel; government regulation and laws; the Corporations relationship with First Nations; environmental developments; and general economic, market or business conditions. Investors are cautioned that such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward looking statements. For more information on Pacific Iron Ore Corporation, Investors should review the Corporation's registered filings which are available at www.sedar.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Pacific Iron Ore Corporation
    Todd Montgomery
    CEO
    (403) 228-0607
    (403) 262-4860 (FAX)
    or
    Pacific Iron Ore Corporation
    Leonard Cornez
    Chief Financial Officer
    (403) 218-0294 or 1-866-682-5812
    (403) 265-2887 (FAX)
    or
    Pacific Iron Ore Corporation
    Jeffery Austin
    President
    (250) 763-4892
    (403) 265-2887 (FAX)
    Website: www.pacificironorecorp.com