COPPER PRODUCTION INCREASED; OPERATING COSTS SIGNIFICANTLY REDUCED
MONTREAL, May 8 /PRNewswire-FirstCall/ -- Campbell Resources Inc.
(the "Company") ("Campbell") (TSX: CCH, OTC Bulletin Board: CBLRF)
today announced financial results for the first quarter of fiscal
2008 ended March 31, 2008. During and subsequent to the period, the
Company realized a number of significant achievements: - Increased
ore production by approximately 140% - Increased copper production
by approximately 125% - Reduced loss from operations by
approximately 46% - Opened up two new sources of higher-grade ore
at the Copper Rand mine - Confirmed expansion of mineralized zone
at Copper Rand mine - Began development of the high-grade Corner
Bay deposit at both the 55 and 75 metre levels and began shipment
of ore to the Copper Rand mill. "During the first quarter, Campbell
continued to make significant progress towards its goals of
increasing production and improving its financial performance,"
said Andre Fortier, Campbell's President and Chief Executive
Officer. "Our copper production has grown dramatically and our loss
from operations has been cut by 46%. Copper Rand is now producing
ore from three sources and we recently confirmed the expansion of a
mineralized zone that runs parallel to the main ore body now
developed to the 4,850 foot level. The development at Corner Bay is
also proceeding very well and, in March, we began to ship
higher-grade ore from this mine to the Copper Rand mill. We expect
to be able to steadily ramp up production at Corner Bay over the
coming months and to reach a level of commercial production in the
third quarter." FINANCIAL RESULTS As of January 1, 2007, results
from the Copper Rand mine have been included in the consolidated
operating results. Prior to this, Copper Rand mine was considered
to be in the preproduction development stage and, as such, all
costs, net of revenue from development ore, were deferred as mine
development costs. As of September 11, 2007, operations at Joe Mann
mine ceased and the mine was put on care and maintenance. In
October 2007, the Company commenced production at Merrill Pit. In
the first quarter of 2008, Campbell operations produced 91,520 tons
of ore yielding 2,590 ounces of gold and 2,167,067 pounds of
copper. In the first quarter of 2007, 38,787 tons of ore were
milled, yielding 3,902 ounces of gold and 961,641 pounds of copper.
A total of 791 ounces of gold and Nil pounds of copper were sold in
the first quarter of 2008 compared to 2,096 ounces of gold and Nil
pounds of copper for the same period of 2007. The average market
price for gold in the first quarter of 2008 was $929 (US$925) per
ounce compared to $762 (US$650) per ounce for the same period in
2007. The average market price for copper in the first quarter of
2008 was $3.54 (US $3.52).In the first quarter of 2008, the average
sale price for gold was $916 per ounce compared to $763 in the same
period of 2007. Net metal sales for the first quarter of 2008
reached $0.7 million compared to $1.7 million for the same period
last year, a decrease of $1.0 million. The decrease is mainly due
to the closure of the Joe Mann mine, which was Campbell's
gold-producing mine. As per the contract for the sale of
concentrate between Campbell and Ocean Partners UK Limited ("OP"),
revenues for concentrate inventory shipped cannot be recognized
until the transfer of ownership is completed when the concentrate
is delivered to the discharge port. As at March 31, 2008, $8.1
million of inventory valued at lowest of cost and net realizable
value was stored at Port of Quebec. On this amount of inventory,
provisional payments in the amount of $10.2 million were received
from OP. The contract was amended in March 2008 to allow the
Company to borrow money on concentrate to be shipped. In March
2008, $2.2 million was borrowed and by month end $0.3 million was
repaid. The loss from operations, before interest, totalled $2.8
million in the first quarter of 2008, a reduction of 46% compared
to $5.2 million loss from operations in the prior period. For the
first quarter of 2008, Campbell recorded a net loss of $2.0 million
or $0.00 per share, compared to a net loss of $1.7 million or $0.01
per for the same period in 2007. OPERATING PERFORMANCE Joe Mann
Mine Production at the Joe Mann mine ceased on September 11, 2007
and the mine was placed on care and maintenance. In the first
quarter of 2007, Joe Mann produced 16,744 tons of ore grading 0.218
Au oz/t, 0.21% Cu and 0.157 Ag oz/t. The yield was 3,019 ounces of
gold, 66,435 pounds of copper and 1,564 ounces of silver. The
recovery rate was 82.60% for gold, 92.86% for copper and 59.55% for
silver. Copper Rand Mine The Copper Rand mine started commercial
production on January 1st 2007. Production at Copper Rand in the
first quarter of 2008 was 46,725 tons grading 0.058 Au oz/t
(yielding 2,289 ounces of gold), 2.02% Cu (yielding 1,804,996 lbs
of copper) and 0.174 Ag oz/t (yielding 5,847 ounces of silver) with
a recovery rate of 84.15% for gold, 95.67% for copper and 71.87%
for silver. In the first quarter of 2007, production totalled
22,043 tons grading 0.047 Au oz/t (yielding 883 ounces of gold),
2.08% Cu (yielding 895,206 lbs of copper) and 0.157 Ag oz/t
(yielding 2,350 oz of silver) with a recovery rate of 85.38% for
gold, 97.62% for copper and 67.81% for silver. The introduction of
the Alimak mining method as well as other initiatives to diversify
the sources of ore at the mine have generated a constant increase
in production output in recent months. There are currently three
production areas at Copper Rand, and a fourth zone should be in
production in the second quarter of 2008. Two new zones should also
be available at the end of 2008 and in the first half of 2009.
Further, the Company has also confirmed the expansion of a
mineralized zone that runs parallel to the main ore body now
developed to the 4,850 foot level. Campbell expects to be able to
maintain increased production levels in the coming months. Merrill
Pit The first tons of ore from Merrill pit were milled in October
2007. In the first quarter of 2008, a total of 43,723 tons of ore
were milled, grading 0.39% copper (318,525 pounds), 0.008 oz/t gold
(276 oz) and 0.085 oz/t silver (2,524 oz). The recovery rate was
94.02% for copper, 81.67% for gold and 67.98% for silver.
Production at Merrill was curtailed in early March because of a
major equipment failure, but as of April 14 it is back in full
production. Corner Bay Development In March 2008, 1,072 tons of
mineralized material were extracted and milled at Corner Bay,
grading 2.15% copper (43,546 pounds), 0.027 oz/t gold (25 oz) and
0.168 oz/t silver (130 oz). The recovery rate was 94.38% for
copper, 86.01% for gold and 72.14% for silver. During the first
quarter of 2008, $4.3 million was invested in the development of
the project. Underground services have been completed. Development
to the 105 metre level continues to progress and mining of the
initial 42,000 tonne bulk sample with an average grade of 3.7%
copper is expected to begin in the second quarter. At a 3% Cu
cut-off, Corner Bay has measured and indicated resources of 446,000
tonnes averaging 5.58% Cu (181,000 @ 5.07% Cu measured and 265,000
@ 5.93% Cu indicated); inferred resources total 1,441,000 tonnes
averaging 6.76% Cu (Ref.: GEOSTAT Technical Report, July 2006,
available on SEDAR at http://www.sedar.com/). OUTLOOK "The
operating and development initiatives the Company is pursuing put
us very much on track to reach our objectives for 2008, which
include doubling Campbell's ore production over 2007 totals,
improving the efficiency at the Copper Rand mill, reducing our
costs per pound of copper, and significantly increasing our
revenues. Additionally, we are continuing to look at opportunities
to acquire and bring into production additional assets in the
prolific Chibougamau mining camp to further its plan of maximizing
throughput at the Copper Rand mill," Mr. Fortier said. Campbell
Resources will hold a conference call on Thursday, May 8, 2008 at 4
P.M (Eastern Time) to discuss this announcement. Interested parties
can join the call by dialling 1-866-249-5221 About Campbell
Resources Limited Campbell Resources Inc. concentrates on the
development and exploitation of copper and gold mining properties
in the Chibougamau region of Quebec. The geographical grouping of
its operations allows the Company to realize economies of scale and
to focus development within access to existing infrastructures.
Campbell's main operations include the Copper Rand and Merrill
mines, the Corner Bay project and the Copper Rand mill. The
Company's headquarters are located in Montreal, Quebec. The
qualified person, Valere Larouche, ing.-geologist, is the Chief
Geologist for Campbell Resources Inc. Analysis was conducted at the
Campbell Resources laboratory in Chibougamau, Quebec. Certain
information contained in this release contains "Forward-Looking
Statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 and is subject to certain risks and
uncertainties, including those "Risk Factors" set forth in the
Campbell's current Annual Report on Form 20-F for the year ended
December 31, 2006. Such factors include, but are not limited to:
differences between estimated and actual mineral reserves and
resources; changes to exploration, development and mining plans due
to prudent reaction of management to ongoing exploration results,
engineering and financial concerns; and fluctuations in the gold
price which affect the profitability and mineral reserves and
resources of Campbell. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date hereof. Campbell undertakes no obligation to release
publicly any revisions to these forward-looking statements to
reflect events or circumstances after the date hereof or to reflect
unanticipated events or developments. CONSOLIDATED BALANCE SHEETS
(UNAUDITED) (Expressed in thousands of Canadian dollars)
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March 31 December 31 2008 2007
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$ $ Assets Current assets Cash 33 474 Restricted cash 1,113 1,113
Short-term investments 30 33 Receivables 2,185 3,066 Settlements
receivable 739 739 Concentrate and metal inventories 9,014 1,218
Supply inventories 2,740 2,882 Prepaids 689 408
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16,543 9,933 Amount receivable from Copper Rand/Portage Restoration
Fiduciary Trust 3,072 3,028 Restricted cash 1,158 1,158 Future
income tax assets 1,338 1,317 Property, plant and equipment 48,662
45,017 Accrued benefit asset 4,975 4,897
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75,748 65,350
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Liabilities Current liabilities Short-term loan 3,264 1,996
Accounts payable 17,231 15,411 Accrued liabilities 6,809 5,954
Prepayments for concentrate 10,248 965 Current portion of long-term
debt 18,394 18,337
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55,946 42,663 Asset retirement obligations 7,503 7,396 Long-term
debt 2,919 2,688 Future income and mining tax liabilities 6,656
6,472
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73,024 59,219
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Shareholders' equity Capital stock 94,854 96,639 Warrants, stock
options and conversion rights 9,776 9,432 Contributed surplus 4,191
4,109 Deficit (106,085) (104,040) Accumulated other comprehensive
loss (12) (9)
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(106,097) (104,049)
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2,724 6,131
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75,748 65,350
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CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (Expressed in
thousands of Canadian dollars except per share amounts)
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Three months ended March 31 2008 2007
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$ $ Gross metal sales 726 1,714 Treatment charges 4 18
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Net metal sales 722 1,696
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Expenses Cost of good sold 692 5,191 Depreciation and amortization
1,125 812 General administration 668 734 Warrants issued as fee for
short-term financial arrangement 427 - Reorganisation and CCAA
costs - 105 Care and maintenance 584 42
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3,496 6,884
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Loss before the following items (2,774) (5,188) Interest expense on
short-term loan (124) (75) Interest and financial expense on
long-term debt (475) (280) Interest income 14 8
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Loss from operations (3,359) (5,535) Other income (expense) Other
(expense) income (308) 3,790
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Loss before taxes (3,667) (1,745) Income and mining tax 1,622 -
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Net loss (2,045) (1,745)
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Weighted average number of common shares ('000) 432,605 348,669
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Loss per share undiluted and diluted 0.00 0.01
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CONSOLIDATED STATEMENTS OF CONTRIBUTED SURPLUS AND DEFICIT
(UNAUDITED) (Expressed in thousands of Canadian dollars)
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Three months ended March 31 2008 2007
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$ $ Contributed surplus Balance, beginning of period 4,109 1,996
Stock options expired and cancelled 25 - Warrants expired 57 1,995
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Balance, end of period 4,191 3,991
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Deficit Balance, beginning of period 104,040 85,052 Net loss 2,045
1,745
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Balance, end of period 106,085 86,797
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Expressed in
thousands of Canadian dollars)
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Three months ended March 31 2008 2007
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$ $ Net Loss (2,045) (1,745) Other comprehensive income, net of
income tax: Unrealized (losses) gain on available-for-sale
investments arising during the period (3) 29
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Comprehensive loss (2,048) (1,716)
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DATASOURCE: CAMPBELL RESOURCES INC. CONTACT: Campbell Resources
Inc.: Andre Fortier, President and Chief Executive Officer, (514)
875-9037, Fax: (514) 875-9764, ; Alain Blais, Vice-president and
General Manager of Operations, (418) 748-7691, Fax: (418) 748-7696,
; Renmark Financial Communications Inc.: Henri Perron, ; Josh
Rivard, , (514) 939-3989, Fax: (514) 939-3717,
http://www.renmarkfinancial.com/
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