Primary Metals Inc.
TSX VENTURE : PMI

Primary Metals Inc.

August 23, 2007 20:57 ET

Primary Metals Reports First Quarter Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 23, 2007) - Primary Metals Inc. ("Primary" or the "Company") (TSX VENTURE:PMI), which operates the Panasqueira tungsten mine in Portugal, has announced consolidated financial results, reported in Euros, for the three months ended June 30, 2007. Net earnings for the quarter after non-cash income taxes were EUR 268,000 (Cdn$398,000) or Cdn$0.03 per share. Net earnings before non-cash income taxes were EUR 397,000 (Cdn$588,000) or Cdn$0.05 per share.

Highlights for the period include:

- Net income for the quarter, before non-cash income taxes, of EUR 397,000 (Cdn$588,000) - EUR 268,000 (Cdn$398,000) after non-cash income taxes

- Net earnings per share, before non-cash income taxes, of EUR 0.03 (Cdn$0.05) - EUR 0.03 (Cdn$0.04) diluted

- Net earnings per share, after non-cash income taxes, of EUR 0.02 (Cdn$0.03) - EUR 0.02 (Cdn$0.03) diluted

- Tungsten production of 28,344 MTUs (MTU - metric tonne unit or 10 kilograms of contained WO3 - tungsten trioxide)

- Sales of EUR 4,194,000 (Cdn$6,000,000) for the quarter

- Continuation of improvement in mine output of 196,000 tonnes, with an average grade of 0.18% WO3 for the quarter

Subsequent to the period, Sojitz Corporation announced its intention to make a board-supported formal take-over bid to acquire all the issued and outstanding shares of Primary at a price of $3.65 per share for a total transaction value of approximately Cdn$54 million (see news release dated August 3, 2007).

"We are pleased to see an improvement in results for the quarter," said Lewis Black, Chairman of the Board. "Mined ore grade showed a modest improvement to 0.18% WO3 as a result of our capital improvements and development work carried out to date. Further work continues and we are confident that the expenditures made over the past two years will result in a long future for mining operations at Panasqueira."

Primary Metals Inc. owns a 100 percent interest in the Panasqueira tungsten mine in Portugal and is currently producing wolframite concentrates containing some 100,000 MTU's of tungsten trioxide per annum. The Panasqueira mine has a long history of production of high-quality wolframite concentrates and is the dominant producer of high-grade tungsten concentrates outside China. Results from the first quarter together with the Management Discussion and Analysis of Results and other information are available at www.sedar.com and on the company's website at www.primarymetals.ca.

On Behalf of the Board of Directors,

James Robertson, P. Eng., Director

James Robertson, P. Eng., is a Qualified Person for Primary and has reviewed and approved the information contained in this News Release.

Certain of the statements made and information contained herein is "forward-looking information" within the meaning of the Ontario Securities Act or "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 of the United States. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation the company's expectations as to the results of planned work programs, potential mineralization, resources, reserves, mine production levels and future tungsten prices. Such statements are based on certain assumptions, including continued demand for tungsten, availability of capital, equipment and personnel to carry out and complete the planned work programs and accuracy within a reasonable range of reported exploration and development results, and involve various risks and uncertainties, including global economic factors, future commodity prices, lack of availability of equipment or personnel, and results of exploration and development. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Other important factors that could cause actual results to differ materially from the Company's expectations are disclosed under the heading "Risk Factors" and elsewhere in the Company's documents filed from time-to-time with regulatory authorities and on www.sedar.com.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

Contact Information