Talvivaara Mining Company Quarterly Interim Results for January - March 2010

STOCK EXCHANGE RELEASE
6 May 2010


Talvivaara Mining Company Quarterly Interim Results for January - March 2010

Talvivaara Mining Company Plc ("Talvivaara" or the "Company") today announces
its unaudited Interim Results for the three months ended 31 March 2010.

Highlights

* Zinc streaming agreement with Nyrstar NV for 1.25 million tonnes of zinc in
concentrate was completed on 11 February 2010; pre-payment of USD 335
million received from Nyrstar
* Project Term Loan Facility of USD 320 million was fully repaid on 11
February 2010 using the proceeds of the zinc streaming agreement
* All nickel, zinc and foreign exchange risk hedging positions associated with
the Project Term Loan Facility were closed for net proceeds of EUR 46
million
* Ramp-up of production suffered from a 3.5 week production stoppage in
February caused by a hydrogen plant failure, and from hydrogen sulphide
odour problems in March forcing the Company to curtail production until
additional gas scrubbing capacity was installed
* Payable nickel and zinc production during the period amounted to 610 tonnes
and 2,960 tonnes, respectively; zinc production came close to the budgeted
level despite the ramp-up issues described above
* Talvivaara announced plans to recover uranium as a by-product with
anticipated future production amounting to approximately 350 tonnes per
annum


Highlights since the end of the review period

* Nickel production in April amounted to 628 tonnes, which is more than the
production achieved during the first quarter
* The annualized production rate has increased to above 15,000 tonnes of
nickel subsequent to the installation of additional gas scrubbing capacity
in April


Revised production guidance

Talvivaara revises its production target for 2010 to 15,000-25,000 tonnes of
nickel. The revision is brought about by the ramp-up related technical problems
encountered at the metals recovery plant during the early part of the year and
back-precipitation of metals in the first section of the primary heap.

The first section of the primary heap has suffered from back-precipitation of
metals stemming from slow and poorly controlled crushing in the early stages of
production and subsequent insufficient aeration. As a result, an inventory of
12,000-13,000 tonnes of nickel has back-precipitated in the oldest heap section.
The back-precipitated metal inventory is soluble and can be re-leached, but it
is not possible to accurately determine how quickly the inventory can be
released to production. Because of this uncertainty, the range in the production
guidance for 2010 is wide.

The heap sections stacked after June 2009 have not suffered from the problems
seen in the first section. Therefore, Talvivaara expects to reach 15,000 tonnes
of nickel production in 2010 from the newer heap sections alone, whilst the
volumes above this are likely to require contribution also from the first heap
section. The Company expects the annualized production rate to be above 30,000
tonnes by the end of 2010 and continues to believe the full scale production
target of approximately 50,000 tonnes per annum to be achievable in 2012.





Key figures
    Q1 Q1 Q1-Q4

    2010 2009 2009

Turnover EUR million 11.6 0.1 7.6

Operating profit (loss) EUR million (2.3) 2.2 (54.8)

Profit (loss) for the period EUR million (16.9) (15.8) (55.0)

Earnings per share EUR (0.06) (0.06) (0.19)

Net interest-bearing debt EUR million 176.3 363.2 426.2

Debt-to-equity ratio 45.4 % 87.3 % 111.4 %

Capital expenditure EUR million 19.0 29.7 118.5

Cash and cash equivalents at the end of the
period EUR million 55.9 20.4 11.9

Number of employees at the end of the period 336 272 308
--------------------------------------------------------------------------------


CEO Pekka Perä comments: "Our production volumes during the early part of this
year reflected a series of teething problems at the metals recovery plant.
Frustratingly, one of the main issues was the odour of hydrogen sulphide which,
when it spread to the nearby communities, forced us to curtail production at an
otherwise functioning plant. This odour problem is being attended to by
increasing the gas scrubbing capacity, and overall I am very encouraged by the
continued improvement in all our production processes. In particular, our
crushing volumes have shown steady progress towards the levels required to reach
our long term goals, and bioheapleaching similarly continues to produce higher
grade solutions thereby contributing our advancing ramp-up.

Although the ramp-up challenges we have had to overcome over the last few months
forced us to revise our production target for the current year, we remain
confident of being on track to reaching our full scale target of approximately
50,000 tonnes of nickel in 2012. Recent progress in production leads us to
believe that the shortfall in nickel tonnes for this year is simply being pushed
to 2011. As a demonstration of our advancing ramp-up I am also pleased to note
that our net sales in the first quarter of 2010 were more than our historical
sales combined, and the sales generated after the reporting period in April were
again more than those seen in the first quarter. "


Presentation and live webcast on 6 May 2010 at 10:00 am GMT / 12:00 pm EET

A combined presentation, conference call and live webcast on the Quarterly
Interim Results for January-March 2010 will be held at 10am on the 6th of May
2010, at the offices of JP Morgan Cazenove, 20 Moorgate, London EC2R 6DA, U.K.

Following the results presentation there will a technical seminar on
Talvivaara's Production Technologies. Both presentations will be held in
English.

Link to Talvivaara
Q1
Results for Period Ending 31 March 2010 Presentation
&
Technical Seminar on Talvivaara's Production Technologies Webcast!

A conference call facility will be available for a Q&A with management following
the presentations.
Details for the conference call:

Please use the following dial-in numbers to join the conference:
0845 634 0041 Lo Call UK
0208 817 9301 Local London
0800 634 5205 Freephone UK
Confirmation Number: 2802792
Meeting Title: Talvivaara Q1 Results & Technical Seminar on Production
Technologies
Meeting Date: May 06, 2010
Meeting Time: 10:00 am [GMT 01:00 Dublin, London, Lisbon (Summer Time)]
Duration: 1 Hour 30 Minutes approximately
Confirmation Number: 2802792

Digital Playback:
Digital Playback 0035314364267
00442077696425
Passcode 2802 792#
Reserved Dates: May 06, 2010 01:00 PM to May 12, 2010 11:59 PM [GMT 01:00
Dublin, London, Lisbon

Further details on the event can be found on the Talvivaara
website,www.talvivaara.com . The webcast will also
be available for viewing on the Talvivaara website shortly after the event until
the end of 2010.

Enquiries:

Talvivaara Mining Company Plc Tel. 358 20 712 9800
Pekka Perä, CEO
Saila Miettinen-Lähde, CFO

MerlinTel. 44 20 7653 6620
Tom Randell
Anca Spiridon




Financial review

Talvivaara's net sales during the three months ended 31 March 2010 amounted to
EUR 11.6 million (Q1 2009: EUR 0.1 million). The net sales were affected by
production volumes that did not reach the budgeted levels primarily due to a
production stoppage in February caused by a catalyst failure at the hydrogen
plant, and production restrictions brought about by hydrogen sulphide emissions
in March.

The Group's other operating income, which mainly came from realised gains on
nickel and zinc forwards, amounted to EUR 15.4 million (Q1 2009: EUR 19.3
million). All commodity and foreign exchange forwards were closed during the
first quarter in connection with the repayment of the Project Term Loan
Facility.

Employee benefit expenses including the value of employee expenses related to
the employee share option scheme of 2007 were EUR (4.9) million (Q1 2009: EUR
(3.8) million). The increase was attributable to the increased number of
personnel.

Other operating expenses amounted to EUR (11.4) million (Q1 2009: EUR (6.2)
million) and included realised losses of EUR (2.9) million on USD forwards.
Operating loss for Q1 2010 was EUR (2.3) million (Q1 2009: profit of EUR 2.2
million).

Finance income for the period was EUR 1.2 million (Q1 2009: EUR 15.7 million)
and consisted mainly of exchange rate gains of EUR 1.1 million on bank accounts.
Finance costs of EUR (21.3) million (Q1 2009: EUR (29.7) million) were caused by
exchange rate losses of EUR (15.9) million on the USD 320 million Project Term
Loan Facility and on the USD 335 million Nyrstar upfront payment, as well as by
interests of EUR (5.4) million on borrowings.

The Company's loss for the period amounted to EUR (16.9) million (Q1 2009: EUR
(15.8) million). The total comprehensive income for Q1 2010 was EUR (20.0)
million (Q1 2009: EUR (8.6) million), including a decrease in hedge reserves due
to occurrence of the hedged sales.

Capital expenditure during the quarter totalled EUR 19.0 million (Q1 2009: EUR
29.7 million) excluding new finance leases of EUR 12.3 million. The expenditure
related primarily to the construction of heap foundations, the design and
installation of the second production line of the metals recovery plant, and to
the secondary heap stacker and conveyors. On the consolidated statement of
financial position as at 31 March 2010, property, plant and equipment totalled
EUR 663.5 million (31 December 2009: EUR 644.4 million).

In the Group's assets, inventories amounted to EUR 124.3 million on 31 March
2010 (31 December 2009: EUR 109.5 million). As the nickel, zinc and USD forwards
were closed in Q1 2010, the derivative financial instruments as at 31 March
2010 consisted of interest rate swaps which were valued at EUR (3.3) million (31
December 2009: EUR 33.1 million). Cash and cash equivalents totalled EUR 55.9
million (31 December 2009: EUR 11.9 million).

In equity and liabilities, the total equity amounted to EUR 388.8 million on 31
March 2010 (31 December 2009: EUR 382.6 million). It includes a perpetual
capital loan of approximately EUR 25 million.

Borrowings decreased from EUR 438.1 million on 31 December 2009 to EUR 232.2
million on 31 March 2010, reflecting the repayment of a USD 320 million Project
Term Loan Facility in February 2010. On 31 March 2010, the borrowings of the
Group included the senior unsecured convertible bonds, the working capital and
investment loan from Finnvera, and the railway term loan, which together
amounted to EUR 161.4 million. Finance lease liabilities of EUR 28.2 million are
also included in the borrowings.

Other long-term liabilities amounted to EUR 248.5 million, including a USD 335
million upfront payment received from Nyrstar NV upon completion of the Zinc in
Concentrate Streaming Agreement. In short-term liabilities, accounts payable
amounted to EUR 25.4 million (31 December 2009: EUR 29.7 million).

Total equity and liabilities as at 31 March 2010 amounted to EUR 908.9 million
(31 December 2009: EUR 879.0 million).
Currency and commodity hedges and hedge accounting

In Q1 2010, the Group closed all its commodity and foreign exchange risk hedging
positions realising net proceeds of EUR 46.0 million. Cash flows from operating
activities were positive due to the closing of the hedges.

Financing

Talvivaara entered into a Zinc in Concentrate Streaming Agreement with Nyrstar
NV ("Nyrstar"). The USD 335 million pre-payment paid by Nyrstar for the
agreement enabled Talvivaara to completely repay its USD 320 million Project
Term Loan in February 2010.

Talvivaara Sotkamo Oy drew down a EUR 25 million perpetual capital loan, which
is recognized in equity. The facility carries an interest of 12% - 18% and can
be called by the borrower at any time after an initial 6 month non-call period.
Talvivaara Sotkamo Ltd also issued two convertible bonds amounting to EUR 20
million and EUR 5 million to Talvivaara Mining Company Plc and Outokumpu Mining
Ltd, respectively. These loans carry an interest of 5% - 12%.

Commercial arrangements

In addition to its financing component, Talvivaara's agreement with Nyrstar also
formed a significant commercial arrangement between the parties. The key
commercial terms of the Nyrstar agreement included Talvivaara's obligation to
deliver all of its zinc in concentrate production to Nyrstar until a total of
1,250,000 metric tonnes has been delivered (equivalent to approximately 2
million tonnes of zinc concentrate at a grade of 65%). Based on Talvivaara's
production plans, the deliveries are expected to occur over a period of 10-15
years. Deliveries commenced in March 2010.
In addition to the initial USD 335 million payment, Nyrstar will pay Talvivaara
an extraction and processing fee of EUR 350 per tonne of zinc in concentrate
delivered (with escalators in relation to prices of elemental sulphur and
propane). The Parties have also agreed the following price participation:
* until the later of the seventh anniversary of the agreement or delivery of
600,000 tonnes of zinc in concentrate, Nyrstar will pay to Talvivaara 10% of
the LME zinc price exceeding USD 2,500 per tonne (up to USD 3,000 per
tonne), and 30% of the LME zinc price exceeding USD 3,000 per tonne; and
* thereafter, Nyrstar will pay to Talvivaara 30% of the excess of the LME zinc
price above the processing fee of EUR 350 per tonne of zinc in concentrate.


Nyrstar has also agreed to supply to Talvivaara up to 150,000 tonnes of
sulphuric acid per annum for use in Talvivaara's leaching process during the
period of supply of the zinc in concentrate.

Production summary

The performance of all production processes at the Talvivaara mine continued to
improve during the first quarter of 2010. However, the payable metals output
fell below the budgeted levels due to production stoppages caused by temporary
technical problems, and because solution flows to the metals plant had to be
restricted because of hydrogen sulphide discharges. Payable nickel produced
during the period amounted to 610 tonnes, while the output of zinc was 2,960
tonnes.

The mining department continued to perform according to expectations, blasting
3.0 million tonnes of ore and 2.4 million tonnes of waste. Ore hauling capacity
was increased by one truck and one excavator during the period, rendering the
mining fleet sufficient for the planned near to medium term needs.

In materials handling, the optimisation of the upgraded crushing circuit
continued with promising results, producing 3.3 million tonnes of crushed and
stacked ore. The daily crushing and stacking volume of 60,000-65,000 tonnes,
which is required for the planned full scale production, was achieved fairly
frequently but not yet consistently. Consequently, the Company decided to add
two more tertiary crushers to the circuit in order to improve the system
availability further. Commissioning of the new crushers is scheduled for June
2010 and the installation is anticipated to be carried out during scheduled
maintenance breaks.

Bioheapleaching progressed well in the second heap section, which was completed
in early January, and in the third section, which is under construction. The
average nickel grade in solution fed to the metals recovery plant rose to above
2 g/l in March from 1.3 g/l in February. Overall, metals production from the
second heap section, which was the main source of solution for metals recovery
during the period, corresponded well to budgeted levels.

The first heap section continued to suffer from back-precipitation of metals
resulting from insufficient aeration and too fine particle size of the crushed
ore, among other factors. Measures are being taken to re-leach the
back-precipitated metal inventory from this heap section, but it is difficult to
predict how long the re-leaching process will take and hence how big the
contribution of the first heap section's production to the overall metals
production in 2010 will be. Owing to improved crushing control and aeration, the
newer heap sections have not exhibited the back-precipitation behaviour seen in
the first heap section.

The Metals recovery output was affected by down-time caused by various technical
issues typical of a ramp-up phase. The most significant issue faced during the
period was the catalyst failure at the hydrogen plant, which caused a 3.5 week
production stoppage in February. The failure was found to have been caused by
impurities in propane, which is used as a raw material of the process. As a
result, the quality control of propane as well as all other incoming raw
materials has since been upgraded.

Since late February, when the hydrogen plant was re-started, the metals recovery
process has functioned consistently and the product quality of both nickel and
zinc sulphides has steadily improved helped by the continuous operation.
However, the volume of solution flows to the metals plant have had to be
restricted due to hydrogen sulphide discharges, which have caused odour problems
in the surrounding communities. Installation of additional gas scrubbing
capacity in April now allows one production line to be operated at nearly full
capacity, but further gas scrubbing capacity will still be necessary in
anticipation of the commissioning of the second production line in June.
Unbudgeted capital expenditure relating to the additional gas scrubbing capacity
is anticipated to remain below EUR 1 million.

Operating expenses during the first quarter were materially in line with the
budget.

Production key figures

-------------------------------------------------------------------------
      Q1 2010 Q4 2009 Q1-Q4 2009
-------------------------------------------------------------------------
Mining

Blasted ore million tonnes 3,0 3,5 10,8

Excavated waste million tonnes 2,4 1,5 4,3

Materials handling

Stacked ore million tonnes 3,3 3,0 8,5

Bioheapleaching

  Ore in primary heap million tonnes 14,3 11,0 11,0

Metals recovery

  Nickel sulphide production dry metric tonnes 1 219 857 1 525

Nickel metal content tonnes 610 410 735

Zinc sulphide production dry metric tonnes 4 926 3 827 5 271

Zinc metal content tonnes 2 960 2 313 3 133
-------------------------------------------------------------------------





Talvivaara intends to extract uranium as a by-product

In February, Talvivaara announced its intention to initiate the recovery and
exploitation of uranium as a by-product. The Company plans to recover uranium in
the form of auranium intermediate, yellow cake, from its main leaching process
by using a safe and technically simple solvent extraction process which is
widely applied to metals recovery.

The planned investment in the solvent extraction plant is estimated at
approximately EUR 30 million. Annual production costs are estimated at
approximately EUR 2 million and the annual production volume at approximately
350 tonnes.

Talvivaara has initiated discussions with leading companies in the industry
regarding a potential cooperation for the uranium production and sales. The
financing and operating model for operation will be determined based on
agreement with the eventual partner.

After the reporting period, on 20 April 2010, Talvivaara Sotkamo Ltd lodged an
application in accordance with the Nuclear Energy Act to the Ministry of
Employment and Economy for the extraction of uranium as a by-product.
Preparations for the environmental impact assessment relating to the uranium
extraction process have also commenced at the mine site.

Environment, health and safety

On 18 March Talvivaara encountered an environmental event as a leakage in the
gypsum pond was detected at the mine. The leakage was contained with dam
structures built at the mine site and did not cause discharge outside the mining
concession.

In order to decrease the inflows into the gypsum pond the Company shut down the
metals recovery plant temporarily as a precautionary measure. The metals
recovery process was resumed later the same day after the Company had ensured
that it was environmentally safe to restart the plant. A specialist team on site
continued reinforcement work at the settlement ponds for nearly a month after
the leakage.

The number of Lost Time Injuries (LTI's) to Talvivaara personnel was 5 during
the first quarter. The LTI frequency was 37 accidents per million hours worked
year to date and 16 during the last 12 months.

Personnel

The number of personnel on 31 March 2010 amounted to 336 (Q1 2009: 272), up by
28 from 308 at the end of 2009. The number of personnel includes eight drillers,
who during the period had successfully completed a training course arranged
jointly by Talvivaara and the North-Karelian vocational institute and were
subsequently employed by the Company. Wages and salaries paid during the period
totalled EUR 3.0 million (Q1 2009: EUR 2.6 million).

Eeva Ruokonen, MSc(Mining), Lic.Tech.(Mineral Processing) was appointed Chief
Sustainability Officer and member of the Company's Executive Committee from the
beginning of February 2010.

Risks and uncertainties

In line with current corporate governance guidelines on risk management,
Talvivaara carries out an ongoing process endorsed by the Board of Directors to
identify risks, measure their impact against certain assumptions and implement
the necessary proactive steps to manage these risks.

Talvivaara's operations are affected by various risks common to the mining
industry, such as risks relating to the development of Talvivaara's mineral
deposits, estimates of reserves and resources, infrastructure risks, and
volatility of commodity prices. There are also risks related to currency
exchange ratios, management and control systems, historical losses and
uncertainties about the future profitability of Talvivaara, dependence on key
personnel, effect of laws, governmental regulations and related costs,
environmental hazards, and risks related to Talvivaara's mining concessions and
permits.

In the short term, Talvivaara's key operational risks relate to the ongoing
ramp-up of operations. While the Company has demonstrated that all of its
production processes work and can be operated on an industrial scale, the rate
of ramp-up may still be subject to risk factors that are currently unknown or
beyond the Company's control.

The market price of nickel has risen to around USD 25,000 - 27,000 per tonne
from the lows of approximately USD 10,000 per tonne a year ago. In view of the
recent and longer term historical volatility in nickel price and the speculative
component included in the recent price development, there may in the Company's
view be some downward pressure on the prices in the short term. Talvivaara is,
as of February 2010, unhedged against variations in metal prices. Full or
substantially full exposure to nickel prices is in line with Talvivaara's
strategy and supported by the Company's view that it can operate the Talvivaara
mine profitably also during the lows of commodity price cycles.

Talvivaara's revenues are almost entirely in US dollars, whilst the majority of
the Company's costs are incurred in Euro. Potential strengthening of the Euro
against the US dollar could thus have a material adverse effect on the business
and financial condition of the Company. Talvivaara is, as of January 2010,
unhedged against the currency exchange risk relating to the US dollar. In view
of the recent weakness in Euro, the Company considers its unhedged position
justified for the time being. However, the Company anticipates hedging against
currency exchange volatility at least on a case by case basis going forward.

Shares and shareholders

The number of shares issued and outstanding on 31 March 2010 was 245,176,718.
Including the effect of the convertible bond of 14 May 2008 and the Option
Scheme of 2007, the authorised full number of shares of the Company amounted to
263,669,291 at the end of the period.

As at 31 March 2010, the shareholders who held more than 5% of the shares and
votes of Talvivaara were Pekka Perä (23.3 %), Varma Mutual Pension Insurance
Company (8.6%), and BlackRock Investment Management Ltd (6.3%).

Events after the review period

Annual General Meeting
Talvivaara held its Annual General Meeting on 15 April 2010. The resolutions of
the AGM included:
* that the number of Board members be changed to eight and that Mr. Gordon
Edward Haslam, Mr. D. Graham Titcombe, Ms. Eileen Carr, Mr. Eero Niiva, Ms.
Saila Miettinen-Lähde, and Mr. Pekka Perä be re-appointed as directors of
the Company, and that Mr. Roland Junck and Mr. Tapani Järvinen be appointed
as new directors of the Company;
* that article 5 of the Company's articles of association be amended to
provide for a retirement of all the members of the Board of Directors at
each Annual General Meeting of Shareholders;
* that article 12 of the Company's articles of association be amended so that
the shareholders are convened to the Annual or Extraordinary Shareholders'
Meeting by a notice sent at the earliest three (3) months and at the latest
twenty-one (21) days before the meeting, however, at the minimum nine (9)
days before the record date of the Shareholder's' Meeting. Further, to be
allowed to take part in a Shareholders' Meeting a shareholder must register
with the Company at the latest by the date mentioned in the notice convening
the meeting and which date may not be earlier than ten (10) days before the
Shareholders' Meeting; and
* that the Board of Directors be authorised to decide on repurchasing a
maximum of 10,000,000 of the Company's own shares through public trading,
and to decide on conveying a maximum of 10,000,000 of the Company's own
shares, each in deviation of the pre-emptive rights of shareholders.



Short-term outlook

Talvivaara's production ramp-up is progressing well with all processes
continuously operational since late February and production volumes steadily
increasing. The Company looks into continuing its ramp-up according to the
revised production plan, with significant upside potential above the lower limit
of the guidance range of 15,000-25,000 tonnes of nickel in 2010 existing in form
of the back-precipitated nickel inventory in the first heap section. Talvivaara
expects to turn cash flow positive during the second half of 2010.
The market price of nickel has developed very favourably since the beginning of
2010, reaching levels above USD 27,000/t in the recent weeks. While nickel
fundamentals are clearly supportive of the price development, with stainless
steel production increasing globally by 48% y/y in Q1 2010 and nickel production
being constrained by the continuing Vale Inco strike, there also appears to be
significant fund activity affecting the prices. The Company believes that while
the overall market outlook has improved during the early part of 2010,
reasonable risk of price volatility remains due to potential shifts in
restocking, fund activity and near term nickel supply.


CONSOLIDATED INCOME STATEMENT

Unaudited Unaudited
three three
months to months to
31 Mar 2010 31 Mar 09



(all amounts in EUR '000)
-----------------------

Net sales 11,606 126


Other operating income 15,428 19,257

Changes in inventories of finished goods
and work in progress 19,075 14,282

Materials and services (19,930) (13,635)

Personnel expenses (4,852) (3,783)

Depreciation, amortization, depletion and
impairment charges (12,246) (7,867)

Other operating expenses (11,425) (6,157)

-----------------------
Operating profit (loss) (2,344) 2,223


Finance income 1,151 15.700

Finance cost (21,328) (29,746)
-----------------------
Finance cost (net) (20,177) (14,046)


Loss before income tax (22,521) (11,823)



Income tax expense 5,585 (4,009)

-----------------------
Profit (loss) for the period (16,936) (15,832)


Attributable to:

Equity holders of the Company (13,861) (12,640)

Minority interest (3,075) (3,192)
-----------------------
(16,936) (15,832)


Earnings per share for profit (loss) attributable to the equity
holders of the Company (expressed in ? per share)

Basic and diluted (0.06) (0.06)



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Unaudited Unaudited
three three
months to months to
31 Mar 10 31 Mar 09

(all amounts in EUR '000)
--------------------


Profit (loss) for the period (16,936) (15,832)



Other comprehensive income,

items net of tax

Cash flow hedges (3,019) 7,206

--------------------
Other comprehensive income, net of tax (3,019) 7,206


--------------------
Total comprehensive income (19,955) (8,626)


Attributable to:

Equity holders of the Company (16,276) (6 875)

Minority interest (3,679) (1 751)
--------------------
  (19,955) (8,626)


CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Unaudited Audited Unaudited

(all amounts in EUR '000) 31 Mar 10 31 Dec 09 31 Mar 09

ASSETS

Non-current assets

Property, plant and equipment 663,491 644,356 578,356

Biological assets 6,894 6,614 6,828

Intangible assets 7,745 7,846 7,661

Deferred tax assets 28,222 21,548 -

Derivative financial instruments - - 123,152

Other receivables 7,591 7,582 9,361

713,943 687,946 725,358


Current assets

Inventories 124,307 109,512 45,475

Trade receivables 9,142 3,913 126

Other receivables 5,578 15,477 6,339

Derivative financial instruments - 50,244 62,573

Cash and cash equivalent 55,914 11,877 20,422

194,941 191,023 134,935


Total assets 908,884 878,969 860,293


EQUITY AND LIABILITIES



Equity attributable to equity holders of the parent

Share capital 80 80 80

Share premium 8,086 8,086 8,086

Hedge reserve 14,152 16,567 78,097

Other reserves 438,603 417,448 334,642

Retained earnings (85,229) (71,368) (38,741)

375,692 370,813 382,164

Minority interest in equity 13,087 11,784 33,719

Total equity 388,779 382,597 415,883



Non-current liabilities

Borrowings 208,559 194,796 382,848

Other liabilities 248,535 - -

Derivative financial instruments 3,288 3,110 2,708

Deferred tax liabilities - - 29,611

Provisions 1,804 1,594 1,235

462,186 199,500 416,402

Current liabilities

Borrowings 23,682 243,315 793

Trade payables 25,389 29,669 15,816

Other payables 8,848 9,875 9,583

Derivative financial instruments - 14,013 1,781

Provisions - - 35

57,919 296,872 28,008

Total liabilities 520,105 496,372 444,410


Total equity and liabilities 908,884 878,969 860,293




CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

A. Share capital
B. Share premium
C. Invested unrestricted equity
D. Hedge reserve
E. Other reserves
F. Retained earnings
G. Total
H. Minority interest
I. Total equity

-----------------
(all amounts A. B. C. D. E. F. G. H. I.
in
EUR '000)

Balance at
1 Jan 09 80 8,086 320,607 72,332 13,412 (26,101) 388,416 35,470 423,886


Profit (loss)
for the
period - - - - - (12,640) (12,640) (3,192) (15,832)

Cash flow
hedges - - - 5,765 - - 5,765 1,441 7,206
-------------------------------------------------------------------
Total
comprehensive
income for
the period - - - 5,765 - (12,640) (6,875) (1,751) (8,626)

Employee
share
option scheme

- value of
employee
services - - - - 623 - 623 - 623
-------------------------------------------------------------------
Balance at
31 Mar 09 80 8,086 320,607 78,097 14,035 (38,741) 382,164 33,719 415,883


Balance at
31 Dec 09 80 8,086 401,248 16,567 16,200 (71,368) 370 813 11,784 382,597


Balance at
1 Jan 10 80 8,086 401,248 16,567 16,200 (71,368) 370,813 11,784 382,597

Profit (loss)
for the
period - - - - - (13,861) (13,861) (3,075) (16,936)

Cash flow
hedges - - - (2,415) - - (2,415) (604) (3,019)
-------------------------------------------------------------------
Total
comprehensive
income for
the period - - - (2,415) - (13,861) (16,276) (3,679) (19,955)

Perpetual
capital loan - - - - 19,925 - 19,925 4,982 24,907

Employee
share option
scheme

- value of
employee
services - - - - 1,230 - 1,230 - 1,230
-------------------------------------------------------------------
Balance at
31 Mar 10 80 8,086 401,248 14,152 37,355 (85,229) 375,692 13,087 388,779






CONSOLIDATED STATEMENT OF CASH FLOWS

Unaudited Unaudited
three three
months to months to
31 Mar 10 31 Mar 09

(all amounts in EUR '000)
--------------------
Cash flows from operating activities



Profit (loss) for the period (16,936) (15,832)

Adjustments for

Tax (5,585) 4,009

Depreciation and amortization 12,246 7,867

Other non-cash income and expenses 139 1,537

Interest income (1,151) (15,700)

Fair value gains on financial assets at fair value through
profit or loss (13,655) (18,455)

Interest expense 21,328 29,746
--------------------
(3,614) (6,828)

Change in working capital

Decrease( )/increase(-) in other receivables 4,319 18,420

Decrease ( )/increase (-) in inventories (14,795) (13,784)

Decrease(-)/increase( ) in trade and other payables (4,888) (29,781)
--------------------
Change in working capital (15,364) (25,145)

--------------------
(18,978) (31,973)


Interest and other finance cost paid (4,401) (3,983)

Interest income 47,116 2,990

--------------------
Net cash used in operating activities 23,737 (32,966)


Cash flows from investing activities



Purchases of property, plant and equipment (18,960) (29,675)

Purchases of biological assets - (35)

Purchases of intangible assets (14) (7)

Proceeds from sale of property, plant and equipment - 9

Proceeds from sale of biological assets 59 -

Proceeds from government grant related to intangible assets - 13
--------------------
Net cash used in investing activities (18,915) (29,695)


Cash flows from financing activities

Proceeds from interest-bearing liabilities 5,000 370

Proceeds from perpetual capital loan 24,875 -

Proceeds from other long-term liabilities 243,419 -

Payment of interest-bearing liabilities (234,079) -

--------------------
Net cash generated in financing activities 39,215 370



Net (decrease)/increase in cash and bank overdrafts 44,037 (62,291)



Cash and bank overdrafts at beginning of the period 11,877 82,713
--------------------
Cash and bank overdrafts at end of the period 55,914 20,422




NOTES

1. Basis of preparation

This interim report has been prepared in compliance with IAS 34.

The interim financial information set out herein has been prepared on the same
basis and using the same accounting policies as were applied in drawing up the
Group's statutory financial statements for the year ended 31 December 2009,
added with the following changes.

Revenue recognition
When Talvivaara enters into long-term supply contracts with customers and
receives advance payments for product to be delivered in future periods, the
advance payments are recorded as deferred revenue in other liabilities. The
revenue is recognized as shipments are made and title, ownership, and risk of
loss pass to the customer during the term of the contracts.



2. Property, plant and equipment

Machinery Other
and Construction Land and tangible
(all amounts in EUR '000) equipment in progress buildings assets Total
--------------------------------------------------
Gross carrying amount at 1 Jan
10 209,907 51,671 223,036 202,791 687,405

Additions 12,313 18,952 1 - 31,266

Transfers 40,777 (52,500) 4,795 6,928 -
--------------------------------------------------
Gross carrying amount at 31
Mar 10 262,997 18,123 227,832 209,719 718,671
--------------------------------------------------

Accumulated depreciation and
impairment losses at 1 Jan 10 16,949 - 10,230 15,870 43,049

Depreciation for the year 4,878 - 2,498 4,755 12,131
--------------------------------------------------------------------------------
--------------------------------------------------
Accumulated depreciation and
 impairment losses at 31 Mar
10 21,827 - 12,728 20,625 55,180
--------------------------------------------------

Carrying amount at 1 Jan 10 192,958 51,671 212,806 186,921 644,356
--------------------------------------------------
Carrying amount at 31 Mar 10 241,170 18,123 215,104 189,094 663,491




3. Borrowings

(all amounts in EUR '000)

Non-current 31 Mar 10 31 Dec 09
--------------------
Capital loans 1,405 1,405

Investment and Working Capital loan 45,446 45,417

Senior Unsecured Convertible Bonds 76,148 75,477

Convertible bond 5,030 -

Railway Term Loan Facility 19,898 19,861

Finance lease liabilities 24,482 15,306

Interest Subsidy Loans 4,189 4,187

Other 31,961 33,143
--------------------
  208,559 194,796
--------------------

Current

Project Term Loan Facility - 222,130

Railway Term Loan Facility 19,956 19,898

Finance lease liabilities 3,726 1,287
--------------------
  23,682 243,315
--------------------
--------------------
Total borrowings 232,241 438,111


4. Other liabilities

Other liabilities

(all amounts in EUR '000) 31 Mar 10 31 Dec 09
--------------------
Deferred zinc sales revenue 248,535 -
--------------------
  248,535 -
--------------------
During the first quarter of 2010, Talvivaara received an advance payment of USD
335 million from Nyrstar NV. The advance payment relates to a long-term zinc
supply contract between Talvivaara Sotkamo Ltd and Nyrstar NV. Talvivaara is
required to deliver 1,25 million tonnes of zinc to Nyrstar NV starting from
2010.


Talvivaara Mining Company Plc

Three Three Twelve
months to months to months to
Key financial figures of the Group   31 Mar 10 31 Mar 09 31 Dec 09
------------------------------
Turnover EUR '000 11,606 126 7,571


Operating profit (loss) EUR '000 (2,344) 2,223 (54,776)


Profit (loss) before tax EUR '000 (22,521) (11,823) (75,085)


Profit (loss) for the period EUR '000 (16,936) (15,832) (54,958)


Return on equity (4.4 %) (3.8 %) (13.6 %)


Equity-to-assets ratio 42.8 % (48.3 %) 43.5 %


Net interest-bearing debt EUR '000 176,328 363,220 426,234


Debt-to-equity ratio 45.4 % 87.3 % 111.4 %


Capital expenditure EUR '000 18,974 29,717 118,514


Research & development
expenditure EUR '000 - - 261


Property, plant and equipment EUR '000 663,491 578,356 644,356


Derivative financial instruments EUR '000 (3,287) 181,236 33,121


Borrowings EUR '000 232,241 383,641 438,111


Cash and cash equivalents
at the end of the period EUR '000 55,914 20,422 11,877




Three Three Twelve
months to months to months to
Share-related key figures 31 Mar 10 31 Mar 09 31 Dec 09
----------------------------------------------
Earnings per share EUR (0.06) (0.06) (0.19)

Equity per share EUR 1.53 1.71 1.51

Development of share
price at
London Stock Exchange

Average trading price1 EUR 4.32 1.95 3.57

GBP 3.83 1.77 3.18


Lowest trading price1 EUR 3.94 1.42 1.45

GBP 3.50 1.29 1.29


Highest trading price1 EUR 5.02 2.39 4.68

GBP 4.45 2.17 4.17


Trading price at the end
of the period2 EUR 5.00 2.33 4.35

GBP 4.44 2.17 3.86


Change during the period 15.0 % 82.6 % 224.6 %


Market capitalization at
the
end of the period3 EUR '000 1,226,991 520,244 1,066,454

GBP '000 1,089,075 484,243 947,118


Development in trading
volume

1000
Trading volume shares 39,105 18,353 153,421

In relation to weighted
average number of shares 15.9 % 8.2 % 65.6 %


Development of share
price
at OMX Helsinki

Average trading price1 EUR 4.40 4.21


Lowest trading price1 EUR 3.99 3.05


Highest trading price1 EUR 5.00 4.86


Trading price at the end
of the period2 EUR 4.97 4.33


Change during the period 14.8 % 38.3 %


Market capitalization at
the
end of the period3 EUR '000 1,218,528 1,061,615


Development in trading
volume

1000
Trading volume shares 40,093 113,077

In relation to weighted
average number of shares 16.4 % 48.4 %

Adjusted average number
of shares 245,176,718 222,896,718 233,762,033

Number of shares at the
end of the period 245,176,718 222,896,718 245 176 718

1.Trading price is calculated on the average of EUR/GBP exchange rates published
by the European Central Bank during the period

2.Trading price is calculated on the EUR/GBP exchange rate published by the
European Central Bank at the end of the period

3.Market capitalization is calculated on the EUR/GBP exchange rate published by
the European Central Bank at the end of the period


Three Three Twelve
months to months to months to
Employee-related key figures 31 Mar 10 31 Mar 09 31 Dec 09
------------------------------
Wages and salaries EUR '000 4,236 3,269 14,876

Average number of employees 325 263 272

Number of employees at the end
of the period 336 272 308



Three Three Twelve
months to months to months to
Other figures 31 Mar 10 31 Mar 09 31 Dec 09
------------------------------
Share options outstanding at the
end of the period 5,421,100 4,442,500 5,352,500

Number of shares to be issued against

the outstanding share options 5,421,100 4,442,500 5,352,500

Rights to vote of shares to be
issued against

the outstanding share options 2.2 % 2.0 % 2.1 %




Key financial figures of the Group


Return on equity Profit (loss) for the period/
----------------------------------------
(Total equity at the beginning of
period
Total equity at the end of period)/2


Equity-to-assets ratio Total equity /
----------------------------------------
Total assets


Interest-bearing debt - Cash and cash
Net interest-bearing debt equivalent


Debt-to-equity ratio Net interest-bearing debt/
----------------------------------------
Total equity



Share-related key figures


Profit (loss) attributable to equity
Earnings per share holders of the Company/
----------------------------------------
Adjusted average number of shares


Equity attributable to equity holders
Equity per share of the Company/
----------------------------------------
Adjusted average number of shares


Number of shares at the end of the
Market capitalization at the end of the period * trading price at the end of
period the period




[HUG#1412378]





Talvivaara Q1 Results 2010 Stock Exchange Release 6 May 2010: http://hugin.info/136227/R/1412378/364623.pdf




Unternehmen: Talvivaaran Kaivososakeyhtiö Oyj - ISIN: FI0009014716