Silver Lake reports maiden full-year pretax profit

Silver Lake Resources Ltd (ASX: SLR) reported a maiden pretax profit of A$13.6 million in the full year to end-June 2009, saying that it achieved gold sales of A$58.0 million in the period from 48,353 ounces priced at A$1,200 each.

In the fourth quarter, gold sales totalled A$18.3 million from 15,111 oz at an average realised price of A$1,210 oz, generating pretax profit of A$3.4 million in the period.

The group did not provide comparative figures for last year.

At the Mount Monger operations in Western Australia, ore production at the Daisy Milano underground mine averaged 16,000 tonnes per month in the fourth quarter, higher than the previous quarter. The quarter’s mine production averaged 8.9 grams per ton of gold which was lower than the previous quarter due to approximately 80 percent of production coming from lower grade mining areas.

Daisy Milano is expected to sustain current production rates of 45,000 tonnes at a higher grade for the September 2009 quarter.

The Christmas Flat open pit production at Mount Monger began in June, and first ore will be produced in in the current month. Mining of Stage 1 is expected to be completed in six months and processing completed in 12 months as the company’s Lakewood gold processing facility (LGPF) will be running at capacity from the September 2009 quarter.

Silver Lake received assay results from a sixteen hole surface reverse circulation programme at the Leslie prospect located 2 kilometres north of the Daisy Milano mine. Highlights included: 4 metres at 20.7 g/t Au - including 2 metres at 36.0 g/t Au, from 86 metres, 1 metre at 4.3 g/t Au from 73 metres and 2 metres at 2.3 g/t Au from 54 metres.

Surface diamond drilling will continue in the September 2009 quarter following up the high grade zone identified from the initial programme.

Assay results from the 10 hole underground diamond drilling programme containing visible gold that intersected the Rosemary structure and two additional structures east of Daisy Milano will be available by the end of July 2009.

A 20 hole surface RC programme at the Magic deposit located 3 kilometres south of Daisy Milano was completed during the fourth quarter. Assay results from this programme are expected in August 2009. The information will be used to update the geological model and finalise the well advanced mining study expected to be completed in the September 2009 quarter.

Mining studies for open pit production at Costello and Lorna Doone are underway and will be completed in the December 2009 quarter.

Silver Lake continues to review low capital milling options for the Murchison gold project. Ongoing exploration will focus on extending current resources that are constrained by limited drilling particularly below 100 metres depth. Its strategy is to delineate sufficient resources to sustain a 100,000 oz per annum operation.

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