Dear Quentin

FULL-YEAR GROSS PROFIT DOUBLES AFTER LAVERTON OPERATIONS TURN TO PROFIT; GOLD PRODUCTION RISES

Highlights -       Gross Profit doubles to $55.6M (FY11: $27.7M) -       Revenue increases 151% to record $258.3M (FY11: $102.8M) -       Gold production up 143% to 176,632oz (FY11: 72,830oz) -       Sustainable cost savings in place at Coolgardie and Laverton operations -       Laverton turns to profit in 9 months since acquisition -       New leadership team put in place to drive ongoing growth -       10-year Life of Mine Plan developed for group operations

Focus Minerals Ltd. (ASX: FML), a leading gold producer and explorer with operations in the Eastern Goldfields region of Western Australia, is pleased to announce a doubling of full-year Gross Profit to $55.6 million, up from $27.7 million in the previous corresponding period, as the company benefited from turning around the performance of its recently acquired Laverton gold operations.

The group�s Laverton operations, which comprise large scale open pit mining operations, was acquired by Focus in October 2011 after the all-scrip takeover of Crescent Gold. Focus then injected $17 million of its own cash to open up three new operating areas at Laverton, boosting production to more than 500,000t per quarter from 200,000t per quarter.

The Laverton operations posted a net profit of $3.8 million in the nine month period since being acquired by Focus, turning from a loss of $51 million in FY2011. Since taking control, Focus has reduced operating costs by 23% at Laverton to $1,203/oz from $1,554/oz.

�We�ve managed to turnaround the Laverton operations in a short time frame,� said Focus CEO Campbell Baird. Laverton produced 49,092oz in the second half of FY2012. The strong production rate resulted from higher feed grade (up 5% to 1.89g/t) and improved mine planning.

Laverton operations helped drive Focus� full-year gold output 143% higher to 176,632oz at a cash cost of $1,222/oz.

Full-year revenue increased to $258.3 million, up from $102.8 million a year earlier. Net profit after tax was $6.8 million, down from $7.6 million in FY2011, reflecting increased levels of mine development across Coolgardie and Laverton.

�We�ve had to invest heavily in the business both at the newly acquired Laverton operations and in Coolgardie where we have developed two new mines during the year.  The goal has been to achieve a scale of production where we can leverage our margin to the gold price going forward,� Mr Baird said.
 
Focus� Coolgardie operation produced 89,959oz at a cash cost of $1,194/oz in FY2012.  On a like-for-like basis in the June Quarter, gold production in Coolgardie increased 37%.

During the year, Focus ramped up two new production centres at Coolgardie: the Tindals Open Pits and The Mount underground. Focus is currently starting its new Greenfields open pit centre, which will provide the base load for the group�s Three Mile Hill processing plant for the next two years. Greenfields has a reserve of 1.0Mt at 1.7g/t.

Consolidated Results Summary	FY2012	FY2011	% Change
Gold produced	176,632oz	72,830oz	143%
Revenue	$258.3M	$102.8M	151%
EBITDA	$39.6M	$22.7M	74%
Normalised NPAT	$10.4M	$6.2M	37%
Non recurring costs � Takeover costs	$(3.5)M	-	-
Net Profit After Tax (NPAT)	$6.8M	$7.6M	(10)%
Net Operating cash flow	$56.0	$30.8M	81%

The Focus Group has developed a new 10-year Life of Mine plan which is based purely on the existing 4.3Mozⁱ Mineral Resource base across Coolgardie and Laverton. 

�The life of mine plan demonstrates our ability to sustain current production over 10 years and there is further demonstrable upside on exploration success,� said Mr Baird. 

Circa $225M Placement to Shandong Gold
Subsequent to the end of FY2012, Focus Minerals announced, that it has entered in to a Share Subscription Deed with Shandong Gold International Mining Corporation Limited (�Shandong Gold�), under which Shandong Gold has agreed to subscribe for new fully paid ordinary Focus shares to raise circa $225 million (see ASX release dated September 20, 2012). The Board is recommending the Placement in the absence of a superior proposal and subject to an independent expert opining that the terms of the Placement are reasonable
 
The investment by Shandong Gold will enable Focus to pursue organic and non-organic growth opportunities, and represents the start of a long-term, mutually beneficial relationship which will allow Focus to unlock the potential of its large tenement holdings.  Only 4% of Focus� significant land holdings have so far been explored.

Focus� large landholding in the two major gold precincts of Coolgardie and Laverton provide the potential for the Company to significantly grow its resource base through targeted exploration. �To capitalise on this opportunity for shareholders we clearly need capital to expand reserves and develop more resources hence the strategic placement opportunity we are putting before shareholders,� said Mr Baird.

Primary areas of exploration focus for the group will be Laverton and Burtville, the Greater Coolgardie area and the Treasure Island Gold Project on the Boulder-Lefroy Fault.  Mr Baird said the group�s focus in FY2013 will be to deliver consistent and reducing cash costs with attention to operational improvements and efficiencies and stable production from existing mining centres.  More specifically, the Company will develop the low strip ratio Burtville mining centre at Laverton to create a third major project area and transition the Coolgardie base load from the Tindals Underground mine to the Greenfields open cut.
To read more please click here