Great Western Minerals Group Releases 1st Quarter 2011 Financial Results

Related Quotes

SymbolPriceChange GWG.V

0.70	+0.05

{"s" : "gwg.v","k" : "a00,a50,b00,b60,c10,g00,h00,l10,p20,t10,v00","o" : "","j" : ""}

SASKATOON, SASKATCHEWAN--(Marketwire - 06/30/11) - Great Western Minerals Group Ltd. ("GWMG" or the "Company") (TSX-V:GWG - News)(OTCQX: GWMGF) today announced its financial results for the 1st Quarter of 2011.

GWMG has reported its results under International Financial Reporting Standards. For the three months ended March 31, 2011, GWMG's financial summary and highlights are as follows:

 

----------------------------------------------------------------------------
                                Three months ended        Three months ended
                                       March 31/11               March 31/10
----------------------------------------------------------------------------
Revenue                    $             4,236,890   $             3,886,651
----------------------------------------------------------------------------
Gross Margins              $             1,295,377   $             1,255,386
----------------------------------------------------------------------------
Earnings (Loss)            $           (3,229,428)   $             (705,662)
----------------------------------------------------------------------------
Earnings (Loss) per share  $               (0.009)   $               (0.003)
----------------------------------------------------------------------------

--  Manufacturing / processing revenues from GWMG's wholly owned
    subsidiaries Less Common Metals Limited ("LCM") and Great Western
    Technologies Inc. represent a 9.0% increase over the first quarter of
    2010.
--  Gross margins on manufacturing / processing operations represent a 3.2%
    increase over the same period of 2010.
--  The net consolidated loss for the first quarter of 2011 of $3.2 million
    ($.009/share on a fully diluted basis) includes stock based compensation
    of $1.7 million. The GWMG net loss of $0.7 million ($0.003/share) in the
    first quarter of 2010 included stock based compensation of nil.
--  GWMG completed the first quarter of 2011 with $14.9 million in cash on
    hand compared to $6.1 million as of the same time in 2010.

Less Common Metals Limited results for Q1 of 2011 include the following highlights:

 

----------------------------------------------------------------------------
                                Three months ended        Three months ended
                                       March 31/11               March 31/10
----------------------------------------------------------------------------
Revenue                    $             4,077,247   $             3,601,655
----------------------------------------------------------------------------
Gross Margins              $             1,411,736   $             1,176,471
----------------------------------------------------------------------------
EBITDA                     $               616,198   $               471,017
----------------------------------------------------------------------------
Earnings                   $               382,539   $               335,422
----------------------------------------------------------------------------

--  Gross margins increased 20.0% compared to the first quarter of 2010 and
    EBITDA increased 30.8% compared to the first quarter of 2010.
--  Revenues were significantly higher than budgeted figures for the first
    quarter of 2011.

GWMG President and Chief Executive Officer Jim Engdahl said, "Great Western Minerals Group continues to see significant improvements in revenue and margin performance in our LCM alloy processing operations. As well, our improved cash position relative to the same time last year is important given our Company's aggressive development plans at Steenkampskraal and our expansion plans for Less Common Metals. The influx of cash from the exercise of outstanding warrants continues to put our Company in a much stronger position than has been the case in the past."

Subsequent to quarter end the Company has taken actions as majority shareholder to complete the purchase of the remainder of the outstanding Rare Earth Extraction Co. Limited ("Rareco") shares as provided for under South African law. As of June 6, 2011 the Company had acquired further shares of Rareco, bringing the Company's ownership interest to 95.4%.

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 to be produced at the former producing Steenkampskraal Mine in South Africa. GWMG holds 95.4% equity ownership in Rare Earth Extraction Co. Limited, which owns a 74% equity interest in the formerly producing Steenkampskraal Mine in South Africa. In addition to a planned exploration program at Steenkampskraal, GWMG also holds interests in six Rare Earth exploration and development properties in North America.

Email inquiries should be made to info@gwmg.ca and the company website is located at www.gwmg.ca. Inquiries by direct mail should be addressed to Great Western Minerals Group Ltd., 219 Robin Crescent, Saskatoon, SK S7L 6M8.

Certain information set out in this News Release constitutes forward-looking information. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of GWMG as at the date the statements are made and are subject to a variety of known and unknown 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. Those factors include, but are not limited to, the results of the exploration program, a resource estimate and commencement of production at Steenkampskraal, satisfaction of the conditions precedent with respect to GWMG's offtake agreement, receipt of all required approvals (including those relating to the commencement of production at the Steenkampskraal mine) and risks, uncertainties and other factors that are beyond the control of GWMG, risks associated with the industry in general, commodity prices and exchange rate changes, operational risks associated with exploration, development and production operations, delays or changes in plans, risks associated with the uncertainty of reserve or resource estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although GWMG believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of GWMG contained in this News Release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement and the risk factors contained in GWMG's current annual information form available at www.sedar.com.

CUSIP: 39141Y 10 3

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

 
Contacts:
Great Western Minerals Group Ltd.
Dwight Percy
Manager of Investor Relations
(306) 659-4500
info@gwmg.ca
www.gwmg.ca