Romarco Minerals Inc.

Romarco Minerals Inc.

April 30, 2007 13:03 ET

Romarco Announces Fourth Quarter Results

Notice: Trading in the shares of Romarco was halted on April 26, 2007, pending an announcement. This regulatory halt was imposed by Market Regulation Services, the Market Regulator of the TSX Venture Exchange.

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - April 30, 2007) - ROMARCO MINERALS INC. (TSX VENTURE:R) (the "Company") is pleased to report its financial results for the year ended December 31, 2006. Details of the Company's financial results are described in the audited consolidated financial statements and Management's Discussion and Analysis, which are available on SEDAR and on the Company's website at

Selected Financial Data

Three months ended Year ended
December 31, December 31,
2006 2005 2006 2005

Net loss $ (823,956) $ (695,150) $ (977,107) $ (2,420,267)
Loss per share (0.01) (0.01) (0.01) (0.08)

Cash flows used
in operating
activities (530,436) (1,574,864) 392,886 (2,831,563)
Cash flows from
(used in)
activities (422,213) (203,535) (1,848,249) (1,225,824)
Cash flows from
activities - 8,750 7,737,128 3,630,266
------------ ------------ ------------ ------------

in cash
and cash
equivalents $ (952,649) $ (1,769,649) $ 6,281,765 $ (427,121)
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------

December 31, December 31,
2006 2005

Current assets:
Cash and cash
equivalents $ 7,212,203 $ 930,438
receivable 123,009 901,842
expenses 58,812 14,195
------------ ------------
Total current
assets 7,394,024 1,846,475
Mineral property
interests 3,423,709 1,993,365
Equipment 101,982 29,798
bonds 114,597 68,969
Total assets $ 11,034,312 $ 3,938,607
------------ ------------
------------ ------------

Accounts payable
and accrued
liabilities $ 174,519 $ 163,424

obligations 56,689 -
------------ ------------
231,208 163,424
------------ ------------

Share capital 40,343,097 35,275,533
Warrants 2,717,564 -
Stock Options 540,100 420,200
surplus 672,446 672,446
Deficit (33,470,103) (32,592,996)
------------ ------------
equity 10,803,104 3,775,183
------------ ------------

Total liabilities
and shareholders'
equity $ 11,034,312 $ 3,938,607
------------ ------------
------------ ------------

The loss from operations of the Company primarily reflects the overhead costs incurred by the Company as it oversaw exploration at its projects and evaluated precious metals properties for acquisition. The exploration and development costs incurred at the Company's projects have been capitalized to mineral property interests.

The Company had a net loss of $877,107 for the year ended December 31, 2006 (2005 - $2,420,267). Higher interest income, the receipt of the merger break fees and lower merger and financing fees amortization costs were offset by higher general and administrative expenses and the write down of mineral property interests in 2006 resulting in a lower net loss as compared to 2005.

Audit and accounting fees increased in 2006 as the Company began the practice of having its quarterly statements reviewed by its auditors, starting with the third quarter of 2006. The Company also utilized outside services to prepare corporate income tax filings for itself and its subsidiaries.

Salaries increased from 2005 due to increased staffing levels. Increased participation in 2006 by Romarco at a greater number of industry trade shows than in 2005 resulted in an increase in shareholder relations expenses as well as travel expenses. Consulting fees for the first nine months of 2006 increased as the Company increased its use of outside services to evaluate potential mineral property acquisitions following the termination of the proposed merger.

Other general and administrative expenses include a donation made to the Ralph J. Roberts Center for Research in Economic Geology at the University of Nevada, Reno in the first quarter of 2006 for the purpose of research and student support.

Stock-based compensation for 2006 is considerably lower than it was for the previous year. During 2005 the Company issued 1,450,000 options to staff, directors and consultants, but only issued 750,000 options in 2006. The Company recognized $119,900 of stock-based compensation in 2006 (2005 - $166,600) with a corresponding increase in the stock options component of shareholders' equity.

Interest income earned in 2006 is higher than 2005 due to increased cash levels and the interest earned on the advances made to Western Goldfields in the fourth quarter of 2005. In February 2006, Romarco received $2.2 million as payment of these advances, including accrued interest, as well as the merger break fees and in August 2006, Romarco received $7.7 million as the gross proceeds from a private placement of common shares. During the fourth quarter of 2006, the Canadian dollar weakened versus the US dollar, resulting in the foreign exchange gain recognized in the fourth quarter of 2006. However, this gain was not enough to offset the foreign exchange loss incurred in the earlier part of 2006 when the Canadian dollar strengthened versus the US dollar, and the Company ended 2006 with a foreign exchange loss.

After reviewing the drill results from the Phase I drill program at Cori Puncho, Romarco has determined that the project is not consistent with the Company's focus and objective of identifying a large, high grade deposit. In accordance with CICA Handbook Section 3063, "Impairment of Long-Lived Assets", the accumulated acquisition, land holding and deferred exploration costs spent at Cori Puncho to December 31, 2006 of $389,662 were written-off.

The merger costs of $109,019 incurred in 2006 are primarily legal and accounting fees incurred in the preparation of the merger agreements and planned F-4 Registration Statement. Merger costs incurred in 2005 include the US$200,000 due diligence fee paid to U.S. Gold Corp. Initially, the proposed merger between Romarco and Western Goldfields was to also include U.S. Gold. Under these initial terms, Romarco was to advance US$1,500,000 to U.S. Gold in the form of the US$200,000 fee, payable immediately, and a loan of US$1,300,000. Upon payment of this US$1,300,000 the previously paid US$200,000 fee would be waived by U.S. Gold and added to the US$1,300,000 to form a loan of US$1,500,000 repayable by U.S. Gold in cash or shares of U.S. Gold. In August 2005, and prior to Romarco advancing the additional US$1,300,000, Romarco was notified that U.S. Gold was withdrawing from the planned merger. As a result, in 2005 Romarco expensed the US$200,000 fee paid to U.S. Gold. Merger costs for 2005 also include legal fees incurred in the preparation of the merger agreement and planned F-4 Registration Statement, as well as the fees paid for the preparation of the independent fairness opinion.

During 2006, the Company spent $1,213,079 and issued 300,000 common shares valued at $48,000 for its mineral property interests while in 2005, the Company spent $1,213,079 and issued 400,000 common shares valued at $88,000 for its mineral property interests.

During the third quarter of 2006, Romarco issued a total of 44,910,263 units for total gross proceeds of C$8,532,950. Romarco paid a commission of $483,458, a finder's fee of $113,177 and $199,186 for other costs in connection with this private placement.

Romarco began 2007 with $7,212,203 in cash and no debt. Drill programs at three of Romarco's properties are planned for 2007: the Pinos Gold District in Mexico and Pine Grove and Red Canyon in Nevada. The current drill program at Pinos will be followed up with further mapping and sampling and there are drill programs scheduled for the second quarter of 2007 at Pine Grove and for the third quarter of 2007 at Red Canyon. In addition, Romarco will continue to actively pursue new projects.

Romarco believes it currently has sufficient resources in order to carry out its planned exploration programs and meet its contractual obligations for 2007 and the first half of 2008.


Diane R. Garrett, President and C.E.O.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release, which has been prepared by management.

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