GREAT WESTERN MINERALS GROUP RELEASES 2010 FINANCIAL RESULTS
March 31, 2011 - Saskatoon, Canada: Great Western Minerals Group Ltd. ("GWMG" or the "Company", TSX:V – GWG) today announced its 2010 financial results.
For the year ended December 31, 2010, GWMG’s financial highlights include:
Manufacturing / processing revenues from GWMG’s wholly owned subsidiaries Less Common Metals and Great Western Technologies Inc. were $15.1 million for 2010 representing a 26% revenue increase over 2009.
Gross margins on manufacturing / processing operations were $4.5 million for 2010, representing a 48% increase over 2009.
Net consolidated loss for 2010 of $16.3 million ($.062/share) which includes the write down of mineral properties in the amount of $8.1 million ($.030/share). This compares to a 2009 net loss of $7.0 million ($0.042/share).
The cash loss for 2010 was $5.1 million ($.02/share). This compares to a cash loss of $5.3 ($.03/share) in 2009.
GWMG President and Chief Executive Officer Jim Engdahl said, "Great Western Minerals Group had a very strong financial and operating year in 2010. Our Company was able to increase revenues by 26% and margins by 48% for the year from our Rare Earths processing operations. This is of significance given our plans to be a fully integrated producer."
Engdahl added, "GMWG also saw a significant improvement in the Company’s cash position with $9.2 million as at December 31, 2010 compared to $1.2 million as at December 31, 2009. In addition, subsequent to year end, the Company has received and executed 17,492,828 warrants for common shares of the Company. This contribution of $8,215,781 to the cash position of GWMG is highly relevant to our ability to bring the Steenkampskraal property into mining production."
Other financial and operating highlights of 2010 include:
EBITDA from GWMG’s manufacturing / processing operations was $0.4 million in 2010 compared to ($0.1 million) in 2009.
The Deep Sands ($7.1 million) and True Blue ($1.0 million) mineral property exploration costs were written off in 2010. For Deep Sands, the Company has not relinquished its ownership or permit rights, allowing the Company to potentially recover costs in the future, although those potential recoveries can not be determined at this time.
Subsequent to year end, the offer to purchase Rare Earth Extraction Co Limited ("Rareco") shares that was tendered during 2010 concluded on February 28, 2011 with GWMG holding 92.6% of all outstanding Rareco shares, giving GWMG indirect control of the formerly producing Steenkampskraal mine in South Africa.
GWMG three month and twelve month financial results:
Great Western Minerals Group Ltd. is an integrated Rare Earths processor. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the Company's wholly owned subsidiaries Less Common Metals Limited in Birkenhead, U.K. and Great Western Technologies Inc. in Troy, Michigan, these alloys contain aluminium, nickel, cobalt and Rare Earth Elements. As part of the Company's vertical integration strategy, GWMG has signed an Off-take Agreement for 100% of the Rare Earth Elements produced at the former producing Steenkampskraal mine in South Africa and holds 92.6% ownership in Rare Earth Extraction Co. Limited, the owner of the Steenkampskraal mine. In addition to a planned exploration program at Steenkampskraal, GWMG also holds interests in seven Rare Earth exploration and development properties in North America.
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