Fortuna Reports Cash Flow of US$15.72 Million and Net Income of US$3.85 Million in the Second Quarter of 2012.

Fortuna Reports Cash Flow of US$15.72 Million and Net Income of US$3.85 Million in the Second Quarter of 2012.

Fortuna Silver Mines, Inc. (NYSE: FSM) (TSX: FVI) (BVL: FVI) (Frankfurt: F4S.F) is pleased to announce that it has filed its financial statements and MD&A for the three and six months ended June 30, 2012.

 

Fortuna Reports Cash Flow of US$15.72 Million and Net Income of US$3.85 Million in the Second Quarter of 2012.

VANCOUVER, Aug. 8, 2012 – Fortuna Silver Mines, Inc. (NYSE: FSM) (TSX: FVI) (BVL: FVI) (Frankfurt: F4S.F) is pleased to announce that it has filed its financial statements and MD&A for the three and six months ended June 30, 2012. The full documents are available on SEDAR and have also been posted on the company’s website at http://www.fortunasilver.com/s/financial_reports.asp.

Second Quarter 2012 Highlights:

– Cash generated by operating activities before changes in working capital of US$15.72 million, up 76% over the prior year period (Q2 2011: US$8.91 million).

– Net income of US$3.85 million, down 38% over the prior year period (Q2 2012: US$6.20 million) after a one-time write-off of US$3.86 million for the Mario project.

– Adjusted net income of US$6.89 million, up 37% over the prior year period (Q2 2011:US$5.02 million).

– Revenue of US$38.69 million, up 58% over the prior year period (Q2 2011: US$24.53 million).

– Mine operating income of US$17.08 million, up 15% over the prior year period (Q2 2011: US$14.85 million).

– Cash position (including short term investments) and working capital at June 30, 2012 were US$60.65 million and US$84.91 million respectively.

– Silver and gold production of 996,194 ounces and 5,845 ounces respectively.

– Cash cost per silver ounce, net of by-product credits, was US$3.75.

Jorge Ganoza, Fortuna President and CEO, commented, “Our strong financial performance for the quarter is backed by solid operating and production results from our mines. At San Jose we are advancing our expansion to 1500 tonnes per day, scheduled for commissioning in mid 2013, which will further improve operating margins. At Caylloma, costs to mid-year are generally in line with budget. We are assessing various initiatives-including rebalancing production mix from narrow veins to mitigate new cost-inflationary pressures.”

Fortuna Silver Mines Inc.

Fortuna is a growth oriented, silver and base metal producer focused on mining opportunities in Latin America. Our primary assets are the Caylloma silver mine in southern Peru and the San Jose silver-gold mine in Mexico. The company is selectively pursuing additional acquisition opportunities throughout the Americas. For more information, please visit our website at www.fortunasilver.com.

ON BEHALF OF THE BOARD

Jorge A. Ganoza
President, CEO and Director
Fortuna Silver Mines Inc.

Trading symbols: NYSE: FSM | TSX: FVI | BVL: FVI | Frankfurt: F4S.F

Forward-Looking Statements

This news release contains forward-looking statements which constitute “forward-looking information” within the meaning of applicable Canadian securities legislation and “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts and that are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. When used in this document, the words such as “anticipates”, “believes”, “plans”, “estimates”, “expects”, “forecasts”, “targets”, “intends”, “advance”, “projects”, “calculates” and similar expressions are forward-looking statements.

The forward-looking statements are based on an assumed set of economic conditions and courses of actions, including estimates of future production levels, expectations regarding mine production costs, expected trends in mineral prices and statements that describe Fortuna’s future plans, objectives or goals. There is a significant risk that actual results will vary, perhaps materially, from results projected depending on such factors as changes in general economic conditions and financial markets, changes in prices for silver and other metals, technological and operational hazards in Fortuna’s mining and mine development activities, risks inherent in mineral exploration, uncertainties inherent in the estimation of mineral reserves, mineral resources, and metal recoveries, the timing and availability of financing, governmental and other approvals, political unrest or instability in countries where Fortuna is active, labor relations and other risk factors.

Although Fortuna has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or information, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended. There can be no assurance that any forward-looking statements or information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.

SOURCE Fortuna Silver Mines Inc.

 
 
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