November 09, 2012
Yellowhead Mining Inc. Reports Financial and Operating Results for Three and Eleven Months Ended September 30, 2012

View News Release in PDF Format

Vancouver, BC - Yellowhead Mining Inc. ("Yellowhead" or the "Company") (TSX: YMI, OTCQX: YHMGF) is pleased to report its results of operations for the three and eleven months ended September 30, 2012.

For the full eleven month Financial Statements and Management Discussion and Analysis, please visit SEDAR at www.sedar.com or the Company's web site, www.yellowheadmining.com.

Highlights:
  • Detailed NI 43-101 compliant Feasibility Study was completed and filed on March 29, 2012;
  • Released an updated Resource estimate, with the Measured and Indicated Resource categories at a 0.2% copper cut-off estimated at: Copper - 5.3 billion pounds, Gold - 838,600 ounces and Silver - 34 million ounces;
  • The Environmental Assessment study at Harper Creek was advanced with an ongoing comprehensive baseline study program;
  • Funded a System Impact Study completed by BC Hydro in March 2012. BC Hydro has initiated an Identification Phase Study for power to the North Thompson Valley which will be partially funded by the Company;
  • Completed the purchase of the Weyerhaeuser property in Vavenby for the concentrate rail load-out. The property has approximately 1,880m of rail siding connecting to the Canadian National Railway's transcontinental line that passes through Vavenby;
  • Changed the financial year end from October 31 to December 31 effective for the 2012 financial year;
  • Adopted a shareholder rights plan to ensure the fair treatment of all shareholders in the event of a takeover bid or change of control;
  • On June 11, 2012, the common shares of the Company began trading on the TSX under the symbol "YMI". Concurrent with the TSX listing, the Company's common shares were de-listed from the TSX Venture Exchange;
  • On August 23, 2012, the common shares of the Company began trading in the United States on the OTCQX International marketplace under the symbol "YHMGF";
  • On October 31, 2012, the Company announced a non-brokered private placement of up to a maximum of 13 million Common Shares of the Company at an issue price of $0.65 per Common Share for gross proceeds of up to $8,450,000. On November 8, 2012, the Company announced it had partially completed the private placement by issuing 7,692,307 Common Shares of the Company for gross proceeds of $5,000,000.
Outlook:
  • Submission of the Company's Environmental Assessment application for the Harper Creek project;
  • Preparation and submission of the Company's application for a British Columbia Mines Act Permit for Harper Creek;
  • Ongoing consultation with the First Nations and local communities to address any potential environmental and socio-economic impacts of Harper Creek and the Company's mitigation strategies;
  • Continue exploration activities to better define the resource/reserve at Harper Creek;
  • The Company is seeking strategic partners, project financing and equipment financing to facilitate equipment orders and construction financing when permits are in place.
Summary of Key Financial Highlights

Yellowhead has no revenue from operations. Results can fluctuate significantly from period to period due to the level of engineering and environmental study effort and resource drilling.

The Company's expenditures on the Harper Creek project for the eleven months ended September 30, 2012, were as follows:

Capitalized
Mineral
interests 		Evaluation and
exploration
expenses 		Total
expenditures on
Harper Creek
Balance, October 31, 2011 $ 834,026 $ 19,704,383 $ 20,538,409
Net Additions 51,209 6,748,534 6,799,743
Balance, September 30, 2012 $ 885,235 $ 26,452,917 $ 27,338,152

The Company's net loss for the three months ended September 30, 2012, three months ended June 30, 2012, three months ended March 31, 2012, two months ended December 31, 2011 and the quarterly periods from the prior fiscal year are as follows:

2012 2011 2011
Period Ended 30-Sep 30-Jun 31-Mar 31-Dec 31-Oct 31-Jul 30-Apr 31-Jan
Administrative expenses $ 908 $ 1,139 $ 994 $ 691 $ 878 $ 1,423 $ 1,816 $ 679
Evaluation and exploration expenses 2,093 913 1,520 2,222 3,091 3,822 1,367 1,362
Other expenses/(income) (14) 6 (13) (25) (62) (55) (21) 1,177
Net loss and comprehensive loss for the period 2,987 2,058 2,501 2,888 3,907 5,190 3,162 3,218
Basic and diluted loss per share for the period $ 0.06 $ 0.04 $ 0.05 $ 0.05 $ 0.07 $ 0.13 $ 0.09 $ 0.10

(Amounts are expressed in thousands of Canadian dollars, except per-share amounts)

The Company's administrative expenses for the three months ended September 30, 2012, were in line with the three months ended June 30, 2012.

Exploration costs were higher for the three months ended September 30, 2012 compared to the three months ended June 30, 2012 due to higher costs related to the Company's Environmental Assessment application as the Company progresses towards submission of the application expected in the fourth quarter of 2012.

Other expenses/(income) for the three months ended September 30, 2012, were in line with the three months ended June 30, 2012.

Cash and Cash Equivalents

The Company had cash and cash equivalents of $4,431,551 as at September 30, 2012 compared to cash and cash equivalents of $15,668,987 as at October 31, 2011.

The Company's focus going forward, is expediting the development of the Harper Creek project. Major activities include submittal of the Environmental Assessment report, advancing the Mine Permitting process and pursuing funding activities to develop the Harper Creek project. Following the completion of the private placement announced by the Company on October 31, 2012, the Company believes its current working capital is sufficient to advance its Harper Creek project in the permitting process. However, additional funding will be required by the Company to finance the development of Harper Creek.

International Financial Reporting Standards ("IFRS")

The Company has completed its transition to IFRS with a transition date of November 1, 2010. Details of the adjustments under IFRS and reconciliations between previously reported numbers under Canadian GAAP and IFRS are provided in Note 14 of the Company's condensed consolidated interim financial statements for the eleven months ended September 30, 2012.

Fiscal year end change

The Company is prospectively changing its fiscal year end date from October 31st to December 31st. In accordance with relevant legislation the Company will prepare condensed consolidated interim financial statements for the periods ending and as at December 31, 2011, March 31, 2012, June 30, 2012 and September 30, 2012 for the current fiscal year. The Company's next annual financial statements will be for the fourteen months ended December 31, 2012.

About Yellowhead Mining Inc.

Yellowhead's Harper Creek Project is a copper-gold-silver volcanogenic sulphide deposit located in south-central British Columbia, approximately 150 kilometers by highway north of Kamloops. Feasibility Study results announced on March 2, 2012 showed a pre-tax NPV8 of $749.7 million with an IRR of 20.2% based on long-term metal price projections of US$2.50/lb Cu, US$1,250/oz Au and US$20/oz Ag, and a US$:Cdn$ exchange rate of 0.86:1. The Feasibility Study demonstrated a 28 year project life at a milling rate of 70,000 tpd (25.55Mt/y). The project as designed is expected to produce a total of 3.63 billion pounds of copper, 372,000 ounces of gold and 14 million ounces of silver contained in concentrate.

At a 0.14% Cu cutoff, Proven Reserves are estimated at 401.18Mt @ 0.272% Cu, 0.031g/t Au and 1.15g/t Ag; Probable Reserves 303.22Mt @ 0.248% Cu, 0.027g/t Au and 1.13g/t for a total Proven and Probable Reserve of 704.4Mt @ 0.262% Cu, 0.029g/t Au and 1.14g/t Ag.

The Feasibility Study is based on an updated resource (refer to news release dated February 16, 2012). At a 0.20% Cu cutoff Measured Resources are estimated at 348.5Mt at 0.31 % Cu, 0.034g/t Au, 1.3g/t Ag; Indicated Resources at 466.5Mt at 0.28% Cu, 0.03g/t Au, 1.3g/t Ag for a total Measured and Indicated Resource of 815Mt at 0.29% Cu, 0.032g/t Au and 1.3g/t Ag (5.26 billion pounds of copper contained). A further 80.17Mt at 0.30% Cu, 0.033g/t Au, and 1.4g/t Ag are estimated in the Inferred Resource category (0.53 billion pounds of copper contained) and is reported as waste in the mine production schedule until it can be upgraded by additional infill drilling.

Yellowhead has a 100% interest in the Harper Creek Project (subject to the payment of a 3% NSR royalty capped at $2.5 million, adjusted for inflation and an additional 2.5% NSR royalty on an estimated 1.5 Mt of ore which is expected to be mined beginning in year 16 of the Feasibility Study mine plan).

T. Gregory Hawkins, Interim Chief Executive Officer of the Company and a Qualified Person under NI 43-101, has reviewed and approved the technical content of this press release.

For more information, please contact:

Ronald Handford, Executive Vice President, Corporate Development
604.681.1709 Ext. 204
Email:rhandford@yellowheadmining.com
Website:www.yellowheadmining.com
Twitter:http://twitter.com/#!/YMI_Mining

Forward Looking Statements

Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others, the accuracy of mineral grades and related assumptions, inherent operating risks, planned expenditures, proposed exploration and development at the Harper Creek Project, operating and economic aspects of the Harper Creek Project, as well as those risk factors identified in the Company's Annual Information Form filed under the Company's SEDAR profile. Yellowhead undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. More detailed information about potential factors that could affect projected results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Yellowhead.

This news release includes disclosure of scientific and technical information, as well as information in relation to the calculation of mineral resources and reserves, with respect to the Harper Creek Project. Yellowhead's disclosure of mineral resource and reserve information is governed by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM") Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as may be amended from time to time by the CIM ("CIM Standards"). There can be no assurance that mineral resources will ultimately be converted into mineral reserves. Mineral resources are not mineral reserves and do not have demonstrated economic viability. This news release uses the terms "measured", "indicated" and "inferred" resources. U.S. persons are advised that while such terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. "Inferred Resources" have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred resources may not form the basis of feasibility or other economic studies. U.S. persons are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. U.S. persons are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable.

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.
distributed by