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Home Business Imperial Metals reports on Mt. Polley Mine exploration

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PostHeaderIcon Imperial Metals reports on Mt. Polley Mine exploration

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Imperial-MetalsImperial Metals Corporation reports comparative financial results for the three and six months ended June 30, 2012 and June 30, 2011 which are summarized below and discussed in detail in the Management's Discussion and Analysis.

The Company's financial results are prepared in accordance with International Financial Reporting Standards.Revenues were $69.0 million in the June 2012 quarter compared to $39.4 million in the 2011 quarter.

The June 2012 quarter includes two concentrate shipments from the Mount Polley mine and two concentrate shipments from the Huckleberry mine, compared to one concentrate shipment from Mount Polley mine and one concentrate shipment from Huckleberry mine in the comparative 2011 quarter.

Variations in quarterly revenue attributed to the timing of concentrate shipments can be expected in the normal course of business.The Company recorded net income of $12.0 million in the June 2012 quarter compared to net income of $8.0 million in the 2011 quarter.

Adjusted net income in the quarter was $10.5 million or $0.14 per share, versus $5.4 million or $0.07 per share in the June 2011 quarter. Adjusted net income is calculated by removing the unrealized gains and losses, net of related income taxes, resulting from mark to market revaluation of copper and foreign exchange derivative instruments.

Adjusted net income is not a term recognized under IFRS in Canada however, it does show the current period financial results excluding the effect of items not settling in the current period.Gains on derivative instruments were $2.1 million in the June 2012 quarter compared to gains of $1.7 million in the June 2011 quarter including unrealized net gains on copper derivatives of $1.9 million in the June 2012 quarter compared to $3.7 million in the June 2011 quarter.

The Company realized gains of $0.2 million on copper derivatives in the June 2012 quarter compared to losses of $2.0 million in the June 2011 quarter.Cash flow increased to $21.8 million in the three months ending June 30, 2012 from $11.2 million in the comparative 2011 quarter. The $10.6 million increase is primarily the result of improved income from mine operations resulting from higher sales volumes.Capital expenditures increased to $44.2 million from $28.7 million in the comparative 2011 quarter.

All expenditures in the June 2012 quarter were financed from cash flow from the Mount Polley and Huckleberry mines and from short term debt. At June 30, 2012 the Company had $53.6 million in cash and short term investments.During the June 2012 quarter the Company did not purchase any common shares for cancellation.

Throughput was up 10% from the comparable period in 2011, and for the quarter averaged 23,758 tonnes per calendar day a record quarterly throughput. Increased throughput, improved copper and gold recoveries, and better gold grades resulted in increased copper and gold production of 20% and 25% respectively from the levels achieved in the first six months of 2011.

Gold production for the second quarter was 13,703 ounces, a record since the restart of Mount Polley operations in 2005.Metallurgical performance is slowly improving as the Springer phase 3 pit continues to move deeper, and in July copper recovery averaged 70%, a level not previously seen with Springer ores.

Throughput continues to exceed plan averaging 22,454 tonnes per day for the first six months of 2012. Gold production also continues at good levels with over 4000 ounces being produced in July.Two recently acquired Caterpillar 793 (240 tonne) haul trucks were put into operation in late June 2012. These larger trucks will enable the mine to more fully utilize the P&H 2300 shovel which was put into service earlier this year, and enabled Mount Polley to release five Caterpillar 777 (85 tonne) haul trucks to Red Chris for use in construction activities there.

MOUNT POLLEY EXPLORATION

Surface diamond drilling continues at Mount Polley with two exploration drill rigs onsite. The drilling program is testing for mineralization beneath and adjacent to the Springer pit. During the 2012 second quarter 9,405 metres of diamond drilling were completed in 19 drill holes. The two drills are still working at Springer and the exploration area has been expanded to include drilling beneath the Cariboo pit, immediately adjacent to Springer.

A field crew was mobilized in May to the North Block, approximately 4 kilometres north of the current mining area, to continue early stage exploration initiated in the 2010 field season. During the quarter, 38 line kilometres of grid was established with 475 soil samples collected.

An additional 258 soil samples were collected in July to complete the grid. When all results are received from the lab, crews will investigate the areas that are geochemically anomalous.

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