MEDIA RELEASE

Thursday, 15 August 2013

FINANCIAL RESULTS FOR YEAR ENDING 30 JUNE 2013

Mincor maintains dividend and commits to Kambalda growth despite bottom-line loss

• Net loss after tax of $22.45M (2012: profit of $0.24M), including $15.51M in exploration write-offs.

• The after-tax loss before write-offs and impairments was $6.2M - reflecting the 15% drop in average realised nickel prices for the year.

• Nevertheless Mincor achieved a strong operational performance, beating targets and generating 9,688 tonnes nickel-in-ore at cash costs of A$5.34/lb payable nickel (2012: 10,285t @ A$5.78/lb).

• Cash costs were reduced by a further 7% on the back of the previous year's 27% reduction.

• Directors maintain unbroken dividend record: fully franked final 2 cps dividend (2012: 2cps).

• Despite the excellent operational performance, earnings from operations were down 34% at $27.88M,

due largely to the low nickel price.

• Earnings from operations provided the cash flows to fund $7.5M in dividends, $18.19M in mine capital expenditures and $14.87M in exploration expenditure.

• Mincor ends the financial year with $59.66M in cash and no debt.

• Strong outlook for FY2014, with focus on core businesses:

o Nickel mining at Kambalda - production guidance for FY14 of 8,500-9,000 tonnes of nickel-in-ore at targeted cash cost of A$5.30/lb payable nickel; and

o Gold and nickel exploration in Western Australia - drilling of the exciting MW gold target set to commence in the current Quarter and ongoing nickel exploration.


Australian nickel miner Mincor Resources NL (ASX: MCR) has declared a final fully franked dividend of 2 cents per share, committed to new growth initiatives in Western Australia and forecast a strong FY14 despite posting a bottom line loss for the 12 months to 30 June 2013.
Mincor reported a net loss of $22.45 million for the 12 months to 30 June 2013 (preceding corresponding period: $0.24 million net profit after tax). The loss was due to a 15% drop in the average nickel price for the year to A$7.59/lb (pcp: A$8.89/lb) combined with exploration write-offs totalling $15.51 million and a small impairment charge of $2.8 million against the McMahon nickel mine.
The exploration write-offs included $11.4 million in cumulative PNG exploration costs and $4.1 million of Australian exploration costs. Earnings from operations (revenue less cash costs before provisional pricing adjustments) were 34% lower at $27.88 million (pcp: $42.31 million), directly reflecting the lower nickel price. Sales revenues fell by 19% to $98.58 million (pcp: $121.55 million).
Notwithstanding the challenging market conditions Mincor's strong operational focus and tight cost control enabled its operations to generate healthy cash flows that were used to fund $7.5 million in dividend payments to shareholders, $18.19 million in mine capital development and $14.87 million in exploration.
EBITDA of $8.78 million (pcp: $32.43 million) was significantly affected by the exploration write-offs ($15.51 million versus $4.01 million for the pcp). The bottom line result includes non-cash charges for Depreciation and Amortisation of $34.25 million (pcp: $33.62 million) and impairment of $2.82 million.

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Mincor's production for the year was 312,075 tonnes of ore (pcp: 332,877 tonnes) at an average grade of 3.1% nickel for 8,637 tonnes of nickel-in-concentrate (pcp: 9,179 tonnes) at an average cash cost of A$5.34/lb of payable nickel (pcp: A$5.78/lb).
Mincor's Managing Director David Moore said the Company had been able to deliver a further 7.1%
improvement in cash costs at Kambalda, partly offsetting the impact of the weaker nickel price.
"Our cash cost before royalties was $5.02/lb - beating our target for the year of A$5.20/lb. Considering that we had already reduced cash costs by 27% in the previous financial year, this represents a tremendous performance by our operational team in the face of a very challenging market environment.
"We continue to target cost reductions and operational improvements, and completed a major re-vamp of our roster structure in early July," Mr Moore said. "This comes on the back of a series of operational restructurings completed over the past two years, putting the Company in a strong position relative to other sectors of the industry which are only now facing up to lower commodity prices.
"The low nickel price environment continues to make nickel mining a challenging business at the moment, however we are confident of our ability to manage the downturn and we remain equally confident that the Company is in great shape to benefit from the market rebound when it comes."
The strong operational performance enabled Mincor's Board to maintain the Company's unbroken record of dividend payments by declaring a fully franked final dividend of 2 cents per share, bringing the full-year payout to 4 cents per share.
During the year, the Company spent $14.87 million on exploration activities, comprising $4.13 million on regional exploration, $4.67 million on extensional nickel exploration at Kambalda and $6.07 million on exploration activities in PNG. The Company ended the year with $59.66 million in cash and no debt.

Outlook

Mincor will focus on its core businesses of mining and exploration in Western Australia during the 2014
Financial Year.
The Company expects to produce approximately 259,000 tonnes of ore at an average grade of 3.2% nickel from its Kambalda Operations for 8,500-9,000 tonnes of nickel-in-ore for FY14. Cash operating costs are targeted at A$5.30/lb of payable nickel (including royalties).
Mr Moore said a combined capital and exploration budget of $22 million reflected a strong commitment to the Kambalda nickel business and to the Company's future growth. "This includes $15 million for the ongoing capital development of our mines and $7 million to pursue high-quality gold and nickel exploration targets right in our own backyard. Initial air-core drilling of the high-potential MW Gold Anomaly is due to commence in the current Quarter."

Mincor is a leading Australian nickel producer and an active and self-funded explorer, and is listed on the Australian Securities Exchange. Mincor operates two mining centres in the world class Kambalda Nickel District of Western Australia, and has been in successful production since 2001.

- ENDS -

Released by: On behalf of:

Nicholas Read David Moore, Managing Director

Read Corporate Mincor Resources NL

Tel: (08) 9388 1474 Tel: (08) 9476 7200 www.mincor.com.au

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