IAMGOLD third quarter financial results. (31-OCT-05) PR Newswire

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IAMGOLD third quarter financial results.

Publication: PR Newswire

Publication Date: 31-OCT-05

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------------------------------------------ TSX Trading Symbol: IMG AMEX Trading Symbol: IAG Fully Diluted Shares Outstanding: 151.7MM ------------------------------------------

TORONTO, Oct. 31 /PRNewswire-FirstCall/ --

HIGHLIGHTS: - Net earnings for the third quarter of 2005 were $4.2 million compared to $0.9 million for the third quarter of 2004. - Attributable gold production for the quarter was 109,000 ounces at a cash cost, as defined by the Gold Institute, of US$281/oz. - Operating cash flow for the quarter was US$1.8 million. - Exploration drilling at the Company's Quimsacocha project in Ecuador continues to extend the gold mineralization to the south. Exploration spending has been increased by 36% for 2005 as a result of the positive drilling results. - Quimsacocha resource estimate released on October 28, 2005 of 2.8 million ounces indicated gold, increases IAMGOLD's total resources by 38%. CONSOLIDATED FINANCIAL RESULTS SUMMARY (US$000's): Three Months Ended Nine Months Ended Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2005 2004 2005 2004 ------------------------------------------------------------------------- Net earnings $ 4,198 $ 908 $ 14,316 $ 8,712 Operating cash flow $ 1,828 $ 18,886 $ 16,041 $ 18,396 Net earnings per share - basic and diluted $ 0.03 $ 0.01 $ 0.10 $ 0.06 Operating cash flow per share - basic and diluted $ 0.01 $ 0.13 $ 0.11 $ 0.13 Gold produced (oz) IMG share 109,294 98,844 330,032 312,685 GI cash cost (US$/oz)(x) $ 281 $ 255 $ 277 $ 246 Average realized gold price (US$/oz) $ 438 $ 404 $ 432 $ 406 (x) GI cash cost per ounce is a non-GAAP measure. Please refer to the Supplemental Information attached to the Management's Discussion and Analysis for a reconciliation to GAAP. CONFERENCE CALL

A conference call to review the Corporation's third quarter results will take place on Monday, October 31, 2005 at 3:00 p.m. EST. Local call-in number: 416-640-4127 and N.A. toll-free: 1-800-814-4857. This conference call will also be audiocast on our website (http://www.iamgold.com/).

A replay of this conference call will be available from approximately 5:00 pm October 31 to November 7, 2005 by dialing local: 416-640-1917, passcode: 21158764(followed by the number sign) and N.A. toll-free: 1-877-289-8525, passcode: 21158764(followed by the number sign). A replay will also be available on IAMGOLD's website.

MANAGEMENT'S DISCUSSION AND ANALYSIS

(The following report dated October 31, 2005, should be read in conjunction with the Consolidated Financial Statements for September 30, 2005 and related notes thereto which appear elsewhere in this report. All monetary amounts in this MD&A are expressed in US$ unless otherwise indicated)

OVERVIEW -------------------------------------------------------------------------

Net earnings for the third quarter of 2005 were $4.2 million or $0.03 per share compared to $0.9 million or $0.01 per share for the third quarter of 2004. Year-to-date net earnings in 2005 were $14.3 million or $0.10 per share compared to $8.7 million or $0.06 per share for the same period of 2004. The increase in earnings is mainly a result of corporate transaction costs incurred in 2004 that were not incurred in 2005.

Operating cash flow for the third quarter of 2005 was $1.8 million or $0.01 per share compared to $18.9 million or $0.13 per share for the third quarter of 2004. Year-to-date operating cash flow in 2005 was $16.0 million or $0.11 per share compared to $18.4 million or $0.13 per share for the same period in 2004. The low level of operating cash flow for the third quarter is a result of increases in working capital for the Sadiola and Yatela operations and nil distributions from the Tarkwa and Damang operations during the quarter.

Summarized Financial Results (in $000's except where noted) ------------------------------------------------------------------------- 2005 ------------------------------------------------------------------------- 3rd Qtr 2nd Qtr 1st Qtr ------------------------------------------------------------------------- Net earnings $ 4,198 $ 2,375 $ 7,743 Net earnings per share - basic and diluted 0.03 0.02 0.05 Operating cash flow (deficiency) 1,828 5,680 8,533 Operating cash flow (deficiency) per share - basic and diluted 0.01 0.04 0.06 Cash and bullion balance (at cost) 90,799 88,572 84,361 (at market) 112,204 104,626 98,998 Gold produced (000 oz - IMG share) 109 114 106 Weighted average GI cash cost ($/oz - IMG share)(x) 281 275 273 Gold spot price ($/oz)(xx) 439 427 427 ------------------------------------------------------------------------- ------------------------------------------------------------------------- ------------------------------------------------------------------------- 2004 ------------------------------------------------------------------------- 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr ------------------------------------------------------------------------- Net earnings $ 2,897 $ 908 $ 622 $ 7,182 Net earnings per share - basic and diluted 0.02 0.01 0.00 0.05 Operating cash flow (deficiency) (4,713) 18,886 (6,263) 5,773 Operating cash flow (deficiency) per share - basic and diluted (0.03) 0.13 (0.04) 0.04 Cash and bullion balance (at cost) 85,436 93,017 94,900 113,190 (at market) 101,260 105,920 104,904 127,244 Gold produced (000 oz - IMG share) 119 99 108 106 Weighted average GI cash cost ($/oz - IMG share)(x) 253 255 243 239 Gold spot price ($/oz)(xx) 434 401 393 408 ------------------------------------------------------------------------- ------------------------------------------------------------------------- --------------------------------------------- 2003 --------------------------------------------- 4th Qtr --------------------------------------------- Net earnings 6,977 Net earnings per share - basic and diluted 0.04 Operating cash flow (deficiency) 4,011 Operating cash flow (deficiency) per share - basic and diluted 0.03 Cash and bullion balance (at cost) 113,958 (at market) 127,413 Gold produced (000 oz - IMG share) 108 Weighted average GI cash cost ($/oz - IMG share)(x) 246 Gold spot price ($/oz)(xx) 391 --------------------------------------------- --------------------------------------------- (x) Weighted average Gold Institute cash cost per ounce is a non-GAAP measure. Please refer to the Supplemental Information to the Management's Discussion and Analysis for reconciliations to GAAP. (xx) Average gold price as per the London pm fix. IAMGOLD Attributable Production and Costs ------------------------------------------------------------------------- 2005 2004 ------------------------------------------------------------------------- 3rd 2nd 1st 4th 3rd 2nd 1st Qtr Qtr Qtr Qtr Qtr Qtr Qtr ------------------------------------------------------------------------- Production (000 oz) Sadiola - 38% 44 43 38 47 38 44 45 Yatela - 40% 21 23 23 28 24 25 20 Tarkwa - 18.9% 33 37 35 32 24 23 26 Damang - 18.9% 11 11 10 12 13 16 15 Total production 109 114 106 119 99 108 106 Total cash cost ($/oz - IMG share) (x) 299 292 283 266 264 268 262 GI cash cost ($/oz -IMG share) (x) 281 275 273 253 255 243 239 ------------------------------------------------------------------------- ------------------------------------------------------------------------- (x) Cash costs per ounce are non-GAAP measures. Please refer to the Supplemental Information attached to the Management's Discussion and Analysis for a reconciliation to GAAP.

Gold production at the four operating mines was 10% ahead of production from the third quarter of 2004 as all operations performed reasonably well throughout this year's rainy season in West Africa.

IAMGOLD's attributable share of gold production in 2005 from the above four operating mines remains forecast at 450,000 ounces for the full year, with estimated total cash cost per ounce, as defined by the Gold Institute, of $280 per ounce for the year.

RESULTS OF OPERATIONS ------------------------------------------------------------------------- Mining Interests Three Months Ended Nine Months Ended Sept. 30, Sept. 30, Sept. 30, Sept. 30, ($ 000's) 2005 2004 2005 2004 ------------------------------------------------------------------------- Gold sales $ 27,904 $ 25,637 $ 82,399 $ 81,070 Mining costs 16,593 15,918 54,144 49,906 Depreciation and depletion 4,790 4,416 14,411 14,625 ------------------------------------------------------------------------- Earnings from mining interests $ 6,521 $ 5,303 $ 13,844 $ 16,539 -------------------------------------------------------------------------

The Company records its proportionate share of assets, liabilities and results of operations from its joint venture interests in the Sadiola and Yatela mines.

The Company's share of Sadiola and Yatela revenue in 2005 was 9% higher than the third quarter of 2004 and 2% higher on a year-to-date basis due to a higher gold price in 2005. The average gold revenue at Sadiola and Yatela was $439 per ounce in the third quarter of...

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