SEMAFO Reports 2011 Cash Flow from Operations of $172 Million

MONTREAL, QUEBEC--(Marketwire - March 14, 2012) - SEMAFO (TSX:SMF)(OMX:SMF) today reported its financial and operational results for the fourth quarter and year ended December 31, 2011. All amounts are in US dollars unless otherwise stated.

Fourth Quarter Highlights

• Gold production of 64,800 ounces, an increase of 5% compared to the same period in 2010
• Gold sales of $113.9 million, a 32% increase over the same period in 2010
• Operating income of $47.4 million, an increase of 48% compared to the same period in 2010
• Total cash margin of $1,029 per ounce, an increase of $234 per ounce over the same period in 2010
• Net income of $38.2 million, an increase of 36% compared to the same period in 2010
• Cash flow from operating activities of $54.3 million or $0.20 per share
• Production of 49,700 ounces at Mana

2011 Highlights

In 2011, SEMAFO produced 250,100 ounces of gold for record sales of $395.9 million, compared to gold production of 261,100 ounces and sales of $323.3 million in 2010. Cash flow from operating activities increased to a record $171.9 million compared to $147.5 million in 2010.

Highlights for the year ended December 31, 2011 include:

• Gold production of 250,100 ounces
• Gold sales of $395.9 million, a 22% increase compared to 2010
• Operating income of $154.2 million compared to $124.8 million in 2010
• Total cash margin of $909 per ounce, a 26% increase compared to 2010
• Net income of $122.8 million, an increase of 19% compared to 2010
• Cash flow from operating activities of $171.9 million or $0.63 per share
• Debt free
• Continued exploration success at Mana in Burkina Faso:
  • Discovery of the new Yaho gold zone with mineralization strike-length doubled to more than 1.5 kilometers
  • Identification of prospective new targets
  • New Bombouela Nord permit and rights to new Kona II permit
• Successful completion of Wona underground feasibility study and green-light of the Mana Underground project
• Signed an agreement with the national electricity company to build a power line connecting the Mana Mine to the National Power Grid
• Listed SEMAFO's common shares on NASDAQ OMX Stockholm
• Declaration of inaugural dividend of C$0.02 per share
• Acknowledged as one of Canada's Ten Most Admired Corporate Cultures
• Ranked among Canada's Best Employers for a second consecutive year
• Became a signatory of the United Nations Global Compact

A Word from the CEO

For the twelve-month period ended December 31, 2011, SEMAFO achieved record gold sales, operating income, net income and cash flow from operating activities. Our operations teams were instrumental in the realization of another successful year. Once again in 2011, we achieved our guidance objectives. Gold production for the year totalled 250,100 ounces. Our average cash margin was $909 per ounce, an increase of $186 per ounce over 2010.

A strong performance at our Mana Mine in the fourth quarter set a new quarterly production record for the property, which has consistently demonstrated continuous growth since the beginning of operations three years ago. The fourth quarter also marked our Samira Hill Mine's best quarterly results of 2011.

The year serves as yet another testimony to our strong belief in Mana's long-term potential as we continued to invest in its development. In 2011, we announced a fourth phase of plant expansion aimed at increasing plant capacity to up to 7,200 tonnes per day in bedrock and up to 8,000 tonnes per day in blended ore. We put forward plans for a new production facility in consideration of the positive drill results received from the Fofina, Fobiri and Yaho zones. Detailed evaluations of this new facility are pending the receipt of 2011 drill results in that they will impact the facility's optimal location and size, both elements of which are key to maximizing efficiencies. During the year we also launched the Wona Deep underground project, an undertaking that our teams believe will contribute considerably to the effective development of Mana. We are pleased to say that at the present time the underground development is progressing according to schedule.

SEMAFO's long-term strategy of building sustainable value through discovery and development continues to be beneficial for our organization. In 2011, we invested $38.5 million in exploration at Mana. Exploration results have consistently expanded Mana's reserves and resources and continue to emphasize the overall geological potential of the property. Early in the year, geophysical surveys identified new prospective targets. More than 300,000 meters of reverse-circulation, diamond and air core drilling, and approximately 133,000 meters of auger drilling were carried out during the year over priority targets including the Fofina, Fobiri, Yaho, Kona, Wona, Massala and Saoura areas. Several targets discovered within the past 18 months have been extended with drill results suggesting various styles of gold mineralization throughout the area. The strike length of the newly discovered Yaho zone has more than doubled to over 1.5 kilometers and continues to display persistent lateral continuity, while remaining open in all directions. Accordingly, our 2012 initial exploration budget for Mana has been established at $36 million.

Our significant cash generation capabilities along with our diligent cash flow management make our organization extremely profitable. During the year we paid down our long-term debt leaving our Corporation debt-free, unhedged and able to fund our value-creation activities internally. Owing to our consistently solid performance and ability to deliver on our promises, on November 8, 2011, SEMAFO's Board of Directors declared an inaugural dividend of C$0.02 per share.

In October 2011, our common shares commenced trading through a secondary listing on the NASDAQ OMX Stockholm Exchange in Sweden. By doing so, we are providing European investors with the opportunity to take advantage of SEMAFO's unique Savoir-faire and consistently solid operating results.

We have a proven, experienced management team that knows how to operate in West Africa. We have a skilled, dedicated and engaged workforce. Our Mana property is rich with potential and we have the resources to maximize its value. We are confident in our future.

Our average selling price for the first two months of 2012 was $1,735 per ounce. As we continue to improve, we are accelerating investments in order to develop long-term sustainable value that will ensure great returns for all of our shareholders, employees and host communities in the future.

SEMAFO's Consolidated Financial Statements and Management's Discussion and Analysis and other relevant financial materials are available in the Investor Relations section of the Corporation's website at www.semafo.com. These and other corporate reports are also available on the website maintained by the Canadian Securities regulators at www.sedar.com.

2011 Fourth Quarter and Year-End Conference Call

SEMAFO will host a conference call to discuss the results, as well as to provide an update on operations.

Conference Call:	Date:	Thursday, March 15, 2012
	Time:	10:00 AM (EDT)
	Tel. local & overseas:	+1 (416) 981-9000
	Tel. North America:	1 (800) 917-9975

The conference call will feature Benoit La Salle, President and Chief Executive Officer, Benoit Desormeaux, Executive Vice-President and Chief Operating Officer, Martin Milette, Chief Financial Officer, Michel Crevier, Vice-President Exploration and Mine Geology and SEMAFO's Qualified Person, and Patrick Moryoussef, Vice-President Mining Operations.

The conference call will be archived for replay until April 4, 2012. To access the archived conference call, please dial 1 (800) 558-5253 and enter pass code 21581882 followed by the number sign (#).

A live audio webcast of the conference can be accessed through SEMAFO's website at www.semafo.com. The webcast will be available for replay for a period of 90 days.

Annual and Special Shareholders Meeting

SEMAFO's Annual Meeting of Shareholders will be held on Monday, May 14, 2012 at 4:00 p.m. (EDT) at Le Centre Sheraton Montréal, Salle Drummond, 1201 René-Lévesque Boulevard West, in Montreal, Quebec. Attendees will have the opportunity to ask questions and meet the management team and members of the Board of Directors.

Consolidated Results and Mining Operations

		2011	2010	Variation
Operating Highlights
Gold ounces produced		250,100	261,100	(4	%)
Gold ounces sold		249,600	260,800	(4	%)
(in thousands of dollars, except amounts per ounce, per tonne and per share)
Revenues - Gold sales		395,916	323,275	22	%
Mining operation expenses (excluding government royalties)		150,535	122,144	23	%
Government royalties		19,857	12,712	56	%
Operating income		154,164	124,750	24	%
Income tax expense		29,869	21,793	37	%
Net income		122,759	103,235	19	%
Attributable to:
	Equity shareholders of the Corporation	111,759	100,459	11	%
	Non-controlling interests	11,000	2,776	296	%
Cash flow from operating activities (1)		171,875	147,498	17	%
Basic net income per share		0.41	0.38	8	%
Diluted net income per share		0.40	0.37	8	%
Operating cash flow per share (2)		0.63	0.56	13	%
Average realized selling price (per ounce)		1,586	1,240	28	%
Cash operating cost (per ounce produced) (3)		591	466	27	%
Cash operating cost (per tonne processed) (3)		35	33	6	%
Total cash cost (per ounce sold) (4)		677	517	31	%
Total cash margin (per ounce sold) (5)		909	723	26	%

(1)	Cash flow from operating activities excludes changes in non-cash working capital items.
(2)	Operating cash flow per share is a non-IFRS financial performance measure with no standard definition under IFRS. See the "Non-IFRS financial performance measures" section of the Corporation's MD&A.
(3)	Cash operating cost is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using ounces produced and tonnes processed. See the "Non-IFRS financial performance measures" section of the Corporation's MD&A.
(4)	Total cash cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the mining operation expenses and the government royalties per ounce sold.
(5)	Total cash margin is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using the average realized selling price and the total cash cost.

Fourth Quarter Financial and Operating Highlights

		Three-month period ended December 31,
		2011	2010	Variation
Gold ounces produced		64,800	61,500	5	%
Gold ounces sold		67,200	62,100	8	%
(in thousands of dollars, except amounts per ounce, per tonne and per share)
Revenues - Gold sales		113,854	86,392	32	%
Operating income		47,448	32,165	48	%
Net income		38,196	28,176	36	%
Attributable to:
	Equity shareholders of the Corporation	33,277	26,647	25	%
	Non-controlling interests	4,919	1,529	222	%
Basic net income per share		0.12	0.10	20	%
Diluted net income per share		0.12	0.10	20	%
Cash flow from operating activities (1)		54,325	37,483	45	%
Operating cash flow per share (2)		0.20	0.14	43	%
Average realized selling price (per ounce)		1,694	1,391	22	%
Cash operating cost (per ounce produced) (3)		559	533	5	%
Cash operating cost (per tonne processed) (3)		35	36	(3	%)
Total cash cost (per ounce sold) (4)		665	596	12	%
Total cash margin (per ounce sold) (5)		1,029	795	29	%

(1)	Cash flow from operating activities excludes changes in non-cash working capital items.
(2)	Operating cash flow per share is a non-IFRS financial performance measure with no standard definition under IFRS. See the "Non-IFRS financial performance measures" section of the Corporation's MD&A.
(3)	Cash operating cost is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using ounces produced and tonnes processed. See the "Non-IFRS financial performance measures" section of the Corporation's MD&A.
(4)	Total cash cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the mining operation expenses and the government royalties per ounce sold.
(5)	Total cash margin is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using the average realized selling price and the total cash cost.

Consolidated Statement of Financial Position

(Expressed in thousands of US dollars)

	As at December 31, 2011 $	As at December 31, 2010 $	As at January 1, 2010 $
Assets
Current assets
Cash and cash equivalents	178,713	220,439	62,481
Restricted cash	-	3,750	-
Trade and other receivables	43,022	6,021	9,894
Investment	22,307	-	-
Inventories	81,639	68,952	60,300
Other current assets	5,517	5,238	4,556
Non-current assets	331,198	304,400	137,231
Restricted cash	1,226	657	4,407
Property, plant and equipment	362,187	257,413	200,375
Investment and other non-current assets	29,400	29,400	27,093
	392,813	287,470	231,875
Total assets	724,011	591,870	369,106
Liabilities
Current liabilities
Trade payables and accrued liabilities	59,100	36,789	33,658
Income tax payable	15,509	21,231	5,019
Dividend payable	5,348	-	-
Current portion of long-term debt	-	14,824	18,808
	79,957	72,844	57,485
Non-current liabilities
Long-term debt	-	-	15,612
Advance payable	2,102	1,911	1,737
Provisions	8,505	7,008	5,879
Deferred income tax liabilities	6,954	3,317	5,485
Total liabilities	97,518	85,080	86,198
Equity
Equity shareholders of the Corporation
Share capital	454,746	452,542	329,759
Contributed surplus	10,935	8,053	5,998
Accumulated other comprehensive income	5,686	8,480	6,360
Retained earnings (deficit)	138,467	32,761	(59,209	)
	609,834	501,836	282,908
Non-controlling interests	16,659	4,954	-
Total equity	626,493	506,790	282,908
Total liabilities and equity	724,011	591,870	369,106

Consolidated Statement of Income

For the Years Ended December 31, 2011 and 2010

(Expressed in thousands of US dollars, except per share amounts)

		2011 $			2010 $
Revenues - Gold sales		395,916			323,275
Costs of operations
Mining operation expenses		170,392			134,856
Depreciation of property, plant and equipment		41,210			41,931
General and administrative		22,224			16,820
Corporate social responsibility expenses		3,393			1,393
Share-based payment		4,533			3,525
Operating income		154,164			124,750
Other expenses (income)
Finance income		(439	)		(136	)
Finance costs		1,728			3,781
Foreign exchange loss (gain)		247			(3,923	)
Income before income taxes		152,628			125,028
Income tax expense (recovery)
Current		25,858			23,776
Deferred		4,011			(1,983	)
		29,869			21,793
Net income for the year		122,759			103,235
Attributable to:
Equity shareholders of the Corporation		111,759			100,459
Non-controlling interests		11,000			2,776
		122,759			103,235
Earnings per share
Basic		0.41			0.38
Diluted		0.40			0.37

Consolidated Statements of Cash Flows

For the Years Ended December 31, 2011 and 2010

(Expressed in thousands of US dollars)

		2011 $			2010 $
					(note 28)
Cash flows from (used in):
Operating activities
Net income for the year		122,759			103,235
Adjustments for :
	Depreciation of property, plant and equipment	41,210			41,931
	Share-based payment	4,533			3,525
	Non-cash finance costs	874			1,292
	Unrealized foreign exchange gain	(1,512	)		(502	)
	Deferred income taxes expense (recovery)	4,011			(1,983	)
		171,875			147,498
Changes in non-cash working capital items		(33,828	)		12,311
		138,047			159,809
Financing activities
Reimbursement of long-term debt		(15,000	)		(20,065	)
Proceeds on issuance of share capital		1,643			121,313
Share issue expense		-			(6,311	)
		(13,357	)		94,937
Investing activities
Additional investment		(25,101	)		-
Acquisitions of property, plant and equipment		(145,634	)		(96,741	)
Decrease in restricted cash		3,181			-
		(167,554	)		(96,741	)
Effect of exchange rate changes on cash and cash equivalents		1,138			(47	)
Change in cash and cash equivalents during the year		(41,726	)		157,958
Cash and cash equivalents - beginning of year		220,439			62,481
Cash and cash equivalents - end of year		178,713			220,439
Interest paid		724			2,150
Interest received		439			136
Income tax paid		29,694			5,891

About SEMAFO

SEMAFO is a Canadian-based mining company with gold production and exploration activities in West Africa. The Corporation currently operates three gold mines: the Mana Mine in Burkina Faso, the Samira Hill Mine in Niger and the Kiniero Mine in Guinea. SEMAFO is committed to evolve in a conscientious manner to become a major player in its geographical area of interest. SEMAFO's strategic focus is to maximize shareholder value by effectively managing its existing assets as well as pursuing organic and strategic growth opportunities.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and assumptions and accordingly, actual results and future events could differ materially from those expressed or implied in such statements. You are hence cautioned not to place undue reliance on forward-looking statements. Forward-looking statements include words or expressions such as "long-term", "potential", "development", "aimed at", "increasing", "believe", "will", "expand", "schedule", "strategy", "committed", "evolve", "become", "pursuing", "growth", "opportunities" and other similar words or expressions. Factors that could cause future results or events to differ materially from current expectations expressed or implied by the forward-looking statements include the ability to increase Mana plant capacity to up to 7,200 tonnes per day in bedrock and up to 8,000 tonnes per day in blended ore, the ability of the Wona Deep underground project to contribute to the effective development of Mana, the ability to build sustainable value through discovery and development, the ability to expand Mana's reserves and resources, the ability to maximize Mana's value, the ability to execute on our strategic focus, fluctuation in the price of currencies, gold or operating costs, mining industry risks, uncertainty as to calculation of mineral reserves and resources, delays, political and social stability in Africa (including our ability to maintain or renew licenses and permits) and other risks described in SEMAFO's documents filed with Canadian securities regulatory authorities. You can find further information with respect to these and other risks in SEMAFO's 2011 Annual MD&A and 2011 Annual Information Form and other filings made with Canadian securities regulatory authorities and available at www.sedar.com. These documents are also available on our website at www.semafo.com. SEMAFO disclaims any obligation to update or revise these forward-looking statements, except as required by applicable law.

The above information has been made public in accordance with the Swedish Securities Market Act and/or the Financial Instruments Trading Act.