SOURCE: Romarco Minerals Inc.

August 28, 2007 12:50 ET

Romarco Announces Second Quarter Results

SPARKS, NV--(Marketwire - August 28, 2007) - Romarco Minerals Inc. (TSX-V: R) (the "Company") reports its second quarter financial results. All figures are in Canadian dollars unless otherwise noted. Complete quarterly results are available on SEDAR and on the Company's website at www.romarco.com.

Selected Financial Data (unaudited)

                    Three months ended June 30,   Six months ended June 30,
                          2007          2006          2007         2006

Net income (loss)        $(748,097)   $(656,748)  $(1,545,415)    $377,923
Income (loss) per share      (0.01)       (0.01)        (0.02)        0.01
 - fully diluted             (0.01)       (0.01)        (0.02)        0.01

Cash flows from (used in)
operating activities      (695,043)    (581,423)   (1,416,524)   1,108,232

Cash flows from
financing activities       402,059            -       469,889            -

Cash flows from (used
in) investing activities  (625,012)    (126,568)   (1,360,988)    (415,744)
                       -----------  -----------   -----------  -----------
Increase (decrease) in
cash and cash
equivalents              $(917,996)   $(707,991)  $(2,307,623)    $692,488
                       ===========  ===========   ===========  ===========

                                               June 30,       December 31,
                                                 2007              2006
Current assets:
 Cash and cash equivalents                   $4,904,580        $7,212,203
 Amounts receivable                             152,174           123,009
 Prepaid expenses                                81,642            58,812
 Total current assets                         5,138,396         7,394,024
Mineral property interests                    5,014,477         3,423,709
Equipment                                       173,528           101,982
Other                                           170,238           114,597
                                            -----------       -----------
Total assets                                $10,496,639       $11,034,312
                                            ===========       ===========
Current liabilities:
 Accounts payable and accrued liabilities      $252,524          $174,519
Long-term liabilities:
 Asset retirement obligations                    56,689            56,689
                                            -----------       -----------
                                                309,213           231,208
                                            -----------       -----------
Shareholders' equity:
 Share capital                               41,069,291        40,343,097
 Warrants                                     2,653,607         2,717,564
 Stock Options                                  807,600           540,100
 Contributed surplus                            672,446           672,446
 Deficit                                    (35,015,518)      (33,470,103)
                                            -----------       -----------
Total shareholders' equity                   10,187,426        10,803,104
                                            -----------       -----------
Total liabilities and shareholders' equity  $10,496,639       $11,034,312
                                            ===========       ===========

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

Office, rent and communication costs increased in the second quarter of 2007, and are higher overall for 2007, as the Company opened an office in Reno, Nevada. The Company expects to consolidate its operations in this new office with financial and legal activities remaining in its Vancouver, British Columbia location for the interim period. Salaries increased from 2006 due to increased staffing levels.

Costs to attend industry trade shows increased in 2007, which resulted in an increase in shareholder relations expenses as well as travel expenses as compared to 2006. Travel expenses in 2007 are also higher due to increased travel to the Company's projects and new office in Nevada.

The non-cash expense of stock-based compensation for 2007 is considerably higher than it was for 2006. During the first half of 2007 the Company issued 2,275,000 options to staff, directors and consultants, but only issued 400,000 options in the first half of 2006. The Company recognized $288,500 of stock-based compensation in 2007 (2006 - $68,400) with corresponding increases in the stock options component of shareholders' equity.

Interest income earned in 2007 is higher than in 2006 due to increased cash levels. During the second quarter of 2007, the Canadian dollar continued to strengthen versus the US dollar, resulting in a foreign exchange loss of $144,662 recognized in the first six months of 2007. While the Canadian dollar also strengthened during the second quarter of 2006, this was offset by it weakening in the first quarter of 2006, and for the first half of 2006, the Company recognized a smaller foreign exchange loss of $67,500.

During the second quarter of 2007, Romarco spent $710,192 for its mineral property interests while in the second quarter of 2006, the Company spent $126,568. During the six months ended June 30, 2007, Romarco spent $1,369,879 and issued 677,600 common shares valued at $171,348 for its mineral property interests while in the six months ended June 30, 2006, the Company spent $415,744 and issued 300,000 common shares valued at $48,000 for its mineral property interests.

To June 30, 2007 Romarco has spent $59,665 relating to the acquisition of the Haile Gold Mine. These costs have been deferred and will be allocated to the purchase price upon closing of the acquisition.

At June 30, 2007, the Company had cash and cash equivalents totaling $4,904,580 as compared to $7,212,203 at December 31, 2006. The Company received $469,889 (2006 - nil) from the exercise of warrants and stock options in 2007, of which $402,059 (2006 - nil) was received in the second quarter. The Company received an additional $1,515,449 on the exercise of warrants between July 1 and August 27, 2007.

Romarco continues to work towards closing the acquisition of the Haile Gold Mine and anticipates closing on or before October 30, 2007. After closing, Romarco will initiate a confirmation drilling program to confirm and convert the historic resource of 780,000 oz of gold into a current NI 43-101 proven probable reserve category. The confirmation drilling program will involve approximately 7,000 feet of drilling in approximately 12 holes. This program will be followed by a Feasibility Study and permitting for starting up mining operations at Haile. Exploration activities will be ongoing to increase overall resources and reserves on the property.

Drill programs are also planned for the remainder of 2007 at Pine Grove and Red Canyon in Nevada; and the Pinos Gold District in Mexico.

For further information, please contact Diane Garrett, President and C.E.O. at (775) 355-1900 or by e-mail at dgarrett@romarco.com or Shirene Urton, Executive Assistant at (775) 355-1900 or by e-mail at surton@romarco.com.

ON BEHALF OF ROMARCO MINERALS INC.

"Diane R. Garrett"
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.

Contact Information

  • Romarco Minerals Inc.
    997 Greg Street
    Sparks, Nevada
    89431
    Tel: (775) 355-1900
    Fax: (775) 355-1907
    Email Contact