TVI Pacific Inc.
TSX : TVI

TVI Pacific Inc.

March 31, 2006 12:02 ET

TVI Pacific Announces Consolidated Audited Year End Financial Results for 2005

CALGARY, ALBERTA--(CCNMatthews - March 31, 2006) - TVI Pacific (TSX:TVI) announces financial results for the twelve months ended December 31, 2005. All amounts are expressed in Canadian dollars. The highlights provided in this release should be read in conjunction with the Company's consolidated, audited financial statements and Management Discussion and Analysis for the year ended December 31, 2005, which have been filed on Sedar at www.sedar.com and are also available on the Company's website at www.tvipacific.com.

Financial Review

Year 2005 Highlights:

- Cash flow from operations increased by $5,275,765, from an outflow of $4,141,122 in 2004 to a positive cash flow of $1,134,643 in 2005.

- Total revenue increased 440% from $3,270,966 for 2004 to $17,669,327 for the year.

- Net loss for 2005 was $3,097,956 ($0.009 per share) compared to $4,318,811 in 2004 ($0.013 per share) and includes exploration expenditures of $1,716,407.

- Fourth Quarter cash flow from operations was $887,499 compared to a cash outflow of $2,435,454 in 2004.

- Fourth quarter net loss was $694,902 ($0.002 per share) compared to a net loss in 2004 of $1,702,937 ($0.005 per share). The fourth quarter net loss includes exploration expenditures of $787,037.

Canatuan Mine

- Revenues for 2005 were $14,662,865 with cash flow of $4,536,815 and net income of $1,107,417. In the fourth quarter revenues were $5,542,719 with cash flow of $1,668,937 and net income of $150,792.

- A total of 19,342 ounces of gold and 442,418 ounces of silver was produced and shipped for the year ended December 31, 2005. During the fourth quarter, the mine produced 7,237 ounces of gold and 139,771 ounces of silver. The average price received per ounce of gold and silver sold for the year was $544.19 ($574.71 for the fourth quarter) and $8.85 ($9.45 for the fourth quarter), respectively.

Rapu Rapu 2 1/2% NSR

- The Company received the second royalty payment for Rapu Rapu in the amount of $25,927 net of final tax, bringing the total royalties received for 2005 production to $40,261 net of final tax.

Exploration

- Exploration costs in China for 2005 were $1,032,174 compared to 2004 of $1,615,849. In the Philippines, exploration costs for 2005 were $684,233 compared to $nil in 2004.

Drilling Divison

- Revenues for 2005 were $3,004,923, an increase of $184,618 over 2004. Net income for the year was $40,758 compared to a net loss of $715,218 for 2004. Cash flow from operations was $207,355 an improvement of $793,088 in 2005.

Certain information and statements set out in this News Release, including anticipated production expectations from processing operations at Canatuan, TVI's expansion plans at Canatuan, expectations from TVI's drilling division and planned exploration initiatives throughout the Philippines and China, constitute forward-looking information. Readers should review the cautionary statement respecting forward-looking information that appears at the end of this News Release.

Outlook

The outlook of 2006 remains positive. Near record metal and mineral prices continue with some expectation of even higher prices. The Canatuan mine has completed its first year of commercial mining operations, and is currently experiencing higher throughput and production than originally anticipated by management. The feasibility study for the production of copper and zinc at Canatuan is nearing completion, along with an updated optimization study on the gossan resource available for future mining. Initial planning for the construction of the sulphide flotation plant (expected to be operating at the end of 2006) is well underway. Exploration efforts on existing and new properties have increased as the Company expands its portfolio of properties near the Canatuan mine and throughout the Philippines. A second drill program on the Balabag property was initiated in early 2006. Exploration efforts in China through TVI's affiliate, Hunan Pacific Geological Exploration Inc. (HPGEI), continue with several exploration license applications awaiting final approval by the Military. Work in China has started on copper properties which TVI expects to explore in conjunction with Phelps Dodge Exploration Corporation. The drilling division has recently experienced improved results under its new management.

The Company's cash position is still tight, but with improved production at the Canatuan mine, increased operating results by the drilling division and further royalty payments from Rapu Rapu, management of TVI expects the consolidated cash position to steadily improve throughout the year.

About TVI Pacific Inc. (TSX: TVI)

TVI Pacific Inc. is a publicly-listed (TSX:TVI) mining company focused on exploring for and producing precious and base metals within district scale systems in Asia.

In the Philippines, TVI's most advanced project, the Canatuan Mine began mining and milling operations in mid 2004 producing gold and silver dore. Mill throughput is currently in excess of 1,300 dmtpd ( greater than 130 AuEq oz per day) from a gossan/oxide zone. (For purposes of the foregoing, gold equivalent values were calculated applying a gold price of US$475 per troy ounce and a silver price of US$7.75 per troy ounce.) Further expansion of the mill's processing capacity is underway. Subject to receiving an updated positive feasibility study, which is well underway, TVI's expansion plans for 2006 contemplate the construction of a sulphide flotation plant at Canatuan to process both copper and zinc concentrates from a sulphide zone. In addition, TVI holds a 2.5% net smelter return (NSR) royalty on the Philippine-based Rapu Rapu project (the second foreign-invested, new, mining project in the Philippines), which commenced operations in July 2005, with royalty cash flow to TVI beginning in Q4, 2005. Exploration in the Philippines is being conducted at Canatuan (both to expand TVI's resource base and to find new deposits), and at Balabag, which management of TVI views as a compelling exploration property.

In China, TVI's wholly-owned Chinese subsidiary, Hunan Pacific Geological Exploration Inc. (HPGEI) is the first foreign mining company to be granted both WOFE status and a Qualified Explorer License. HPGEI has three main areas of interest in China - gold exploration in the Golden Triangle region of Guizhou/Yunnan/Guangxi Provinces, copper/gold exploration in Yunnan Province and copper/gold exploration in the Tibet Autonomous Region. HPGEI has 168,200 hectares of land under application in China in the Golden Triangle and in the Tibet A.R.

TVI also has a Drilling Division, based in both the Philippines (EDCO) and China (HPD), which generates revenue from contract drilling.

The statements herein that are not historical facts are forward-looking statements. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "anticipate" or "will" and similar expressions) may include plans, expectations, opinions, or guidance that are not statements of fact. Forward-looking statements are based upon the opinions, expectations and estimates of management as at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. These factors include such things as the volatility of prices for precious metals and base metals, commodity supply and demand, fluctuations in currency and interest rates, inherent risks associated with the exploration and development of mining properties, ultimate recoverability of reserves, timing, results and costs of exploration and development activities, availability of financial resources or third-party financing and new laws (domestic or foreign). Forward-looking information respecting expansion plans at the Canatuan mine is based upon the current budget and development plans of TVI, which are subject to change. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward looking statements of TVI Pacific Inc. contained in this News Release are expressly qualified, in their entirety, by this cautionary statement. Various risks associated with the Company's exploration activities are described in detail in TVI's Annual Information Form, filed by TVI on SEDAR on March 30, 2006, which is available at www.SEDAR.com.

The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.

Contact Information

  • TVI Pacific Inc.
    Clifford M. James
    President and CEO
    (403) 265-4356
    or
    TVI Pacific Inc.
    E. John W. Adkins
    Vice-President Finance
    (403) 265-4356
    or
    TVI Pacific Inc.
    Paul Moon
    Director, Corporate Communications
    (403) 265-4356
    (403) 264-7028 (FAX)
    Email: tvi-info@tvipacific.co
    Website: www.tvipacific.com