Malaga Generates a Net Income of $0.8 Million and an EBITDA of $1.3 Million in Q1 2011
Published : June 17, 2011
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Keywords :   China | Dollar | Market | Peru | Tungsten |

MONTREAL, QUEBEC--(Marketwire - June 17, 2011) - Malaga Inc. ("MLG") (News - Market indicators) is pleased to report that it has filed its unaudited financial statements for the quarter ended March 31, 2011. The management discussion and analysis and unaudited financial statements can be found on the Company's website ( and on SEDAR ( All amounts are in US dollars unless otherwise indicated.

On January 1, 2011, International Financial Reporting Standards ("IFRS") became Canadian GAAP for publicly-accountable enterprises. MLG's interim and annual financial statements are therefore prepared in accordance with IFRS as of January 1, 2011, and comparable figures for 2010 have been restated accordingly. MLG has also therefore adopted the US dollar as its functional and reporting currency. 

Malaga generated net income of $0.8 million ($0.00 per share) in the first quarter of 2011, a $1.8 million increase from the loss of $1.0 million ($0.01 per share) reported in the same quarter of 2010. This improved performance resulted from the combined effect of a low production cost of $129 per MTU and a $159 increase in the average selling price per metric ton unit (MTU).

Operating income was $0.9 million in Q1-2011, a $1.5 million improvement over the $0.6 million loss in the same quarter of 2010. Operating activities generated cash flow of $1.4 million before changes in working capital items, compared to $0.5 million in Q1-2010. 

Sales increased to $5.3 million, up 46% from $3.6 million in the first quarter of 2010. Sales of tungsten concentrate totalled 18,090 MTU. The Company's selling price for tungsten is based on the price of APT (ammonium paratungstate); in the first quarter, the APT price averaged $360 compared to $201 in the first quarter of 2010.

Q1 Key financial data: 

Three-month period ended March 31  
  2011   2010  
(in $'000)        
Sales 5, 257   3, 594  
Cost of sales 3, 534   3, 432  
Amortization and depletion 714   786  
Income from mining activities 1, 722   162  
General and administrative expenses 868   794  
Net earnings (loss) 813   (973 )
EBITDA 1, 314   33  
Earnings (loss) per share (basic and diluted) $0.00   ($0.00 )
Cash cost of production per MTU $129   $136  
Cash flow from operating activities before changes in non-cash working capital items 1, 353   455  
Acquisition of property, plant and equipment 1, 451   359  
Additions to deferred development costs 172   171  
Sales in MTU (Metric Tonne Unit) 18, 090   18, 108  
Production was as follows : Three-month period ended March 31  
  2011   2010  
Tonnes mined 31, 388   28, 190  
Yield (%) 56 % 62 %
Production (MTU) 17, 493   17, 611  

"With cash assets of $1.6 million and working capital of $1.7 million, Malaga has succeeded in consolidating its financial position" said Joey Trombino, Vice President and Chief Financial Officer. "The price of APT on the world market has increased five times since the end of March 2011, and now stands at $460. Tungsten customers absorb these price hikes because the use of the metal in some applications is increasing and it cannot be easily replaced. Furthermore, we are pleased that we were able to keep our production costs low and thus benefit from the increase in the price of APT." added Pierre Monet, President of Malaga. "Malaga is now on course to generate net income in 2011. The drilling program that began in the second quarter will continue throughout the year to increase our reserves and resources in a context of higher global tungsten demand."

Accidents at the Pasto Bueno mine results in two fatalities

The Company is sad to report that there has been two accidents at the Pasto Bueno mine during Q2 2011 resulting in the death of two workers employed by two of Malaga's subcontractors. Official investigations by the Peruvian authorities have been completed to determine the circumstances that led to the accidents. The investigations concluded that in both cases they were accidents and that no fault was attributed to the Company. Six safety and worker training recommendations were made and Malaga will implement these recommendations to ensure that we continue to maintain the highest safety standards. Malaga has a special health and safety unit that oversees and ensures that Malaga complies with all the mandatory mining safety rules and regulations. This unit is composed of 5 health and safety officers under the supervision of a professional health and safety superintendent.


Malaga Inc. owns and operates a mine in Peru and is one of the few publicly-traded producers of tungsten outside of China. Malaga is a low cost producer due to its gravimetric ore concentration process and the availability of hydroelectric power at its Pasto Bueno property in Peru. Malaga produces 15% of the tungsten outside of China. The Company plans to increase production and explore the property to develop its reserves and resources.


Certain statements in the foregoing may constitute forward‐looking statements which involve known and unknown risks, uncertainties and other factors that may cause Malaga's actual results, performance or achievements or industry results to be materially different from any future result, performance or achievement expressed or implied by such forward‐looking statements. The information provided reflects management's current expectations regarding future events and performance as of the date of this news release.

Jean Martineau
Chairman of the Board and Chief Executive Officer
Malaga Inc.
514 288-3224
Pierre Monet
Malaga Inc.
514 288-3224
Nicole Blanchard
Corporate Strategy and Investor Relations
Sun International Communications
450 973-6600
Data and Statistics for these countries : China | Peru | All
Gold and Silver Prices for these countries : China | Peru | All

Malaga Inc.

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Malaga is a gold and tungsten producing company based in Canada.

Malaga holds various exploration projects in Peru.

Its main asset in production is PASTO BUENO in Peru.

Malaga is listed in Canada and in United States of America. Its market capitalisation is CA$ 918 375 as of today (US$ 881 456, € 674 490).

Its stock quote reached its highest recent level on June 20, 2008 at CA$ 0.49, and its lowest recent point on July 15, 2013 at CA$ 0.01.

Malaga has 183 675 000 shares outstanding.

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Annual reports of Malaga Inc.
2007 Annual Report
Nominations of Malaga Inc.
12/2/2011Announces Appointment of Pierre Monet as President and Chief...
6/23/2011Appoints Three New Board Members
7/8/2008appoints Paul Cregheur to the Board of Directors
6/26/2008appoints three new Directors
12/20/2007Appoints a new board member
Financials of Malaga Inc.
4/3/2013Publishes Year-End Results
8/22/2008Q2 2008 financial results and outlook for 2008
4/14/2008Reports its year end financial results for 2007
11/15/2007reports net earnings in its third quarter 2007
8/16/2007Reports $6,749,432 revenue from the sale of gold and tungste...
5/23/2007reports sales of $2.3 million of tungsten concentrate for th...
4/13/2007files its audited consolidated financial statements and anno...
Project news of Malaga Inc.
5/31/2011(Pasto Bueno)Announces a $1.5 Million Diamond Drilling Campaign in the Co...
4/24/2008(Pasto Bueno) Pasto Bueno: Commissioning of the first phase of the Pasto ...
3/3/2008(Pasto Bueno)discovers new tungsten mineralized vein structures at Pasto ...
11/13/2007(Pasto Bueno) Pasto Bueno: Drilling Reveals New Tungsten Mineralized Zone...
5/15/2007(Pasto Bueno)commercial production begins at the Pasto Bueno mine
Corporate news of Malaga Inc.
6/6/2013Files a Notice of Intention to Make a Proposal Under the Ban...
5/21/2013Publishes Q1 Results
4/9/2013Sells Its Hydro Electric Power Plant
11/9/2012Update on Mining Operations
11/9/2012Update on Mining Operations
10/22/2012(Pasto Bueno)Pasto Bueno Process Plant in Care and Maintenance
10/22/2012(Pasto Bueno)Pasto Bueno Process Plant in Care and Maintenance
8/15/2012Announces Its Q2 Results
5/9/2012Maintains Profitability and Generates Cashflow From Operatin...
4/17/2012to Recover Additional Tungsten From Its Tailings Pond
3/28/2012Improves Profitability and Generates a Net Income of $5.6M a...
2/27/2012(Pasto Bueno)Increases Its Resources by More Than 140% and Its Reserves b...
2/16/2012to Build New Hydroelectric Plant in Peru
1/9/2012(Pasto Bueno)Announces Appointment of Fernando Pajuelo Rincon as General ...
10/4/2011Joins OTCQX-"MLGAF"
8/15/2011Reports Financial Results for Second Quarter 2011: Generates...
6/17/2011Generates a Net Income of $0.8 Million and an EBITDA of $1.3...
5/20/2011Says it is Not Aware of Any Undisclosed Development That Wou...
4/11/2011Reports Record Sales of US $4.5 Million in the First Quarter...
3/31/2011Reports Income of $1.1 Million From Mining Activities
10/30/2007 Announces the Final Distribution Ratio of Dynacor Gold Mine...
9/26/2007senior management changes within the company
7/17/2007Change of corporate name and trading symbol (previously Dyna...
4/17/2007has 100% ownership of its Acari property in Peru
3/21/2007signs an engagement letter of up to CA$5 million with D&D Se...
2/20/2007To Spin Off Gold Assets To Shareholders
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