Anaconda Mining Announces Results For Fiscal Fourth Quarter and Year Ended May 31, 2011

TORONTO, Aug. 30, 2011 /CNW/ --
TORONTO, Aug. 30, 2011 /CNW/ - Anaconda Mining Inc. ('Anaconda' or the
'Company') (TSX: ANX) is pleased to report its results for the three
months and year ended May 31, 2011. All


amounts are in Canadian dollars unless stated otherwise.  The financial
results and Management's Discussion and Analysis of these results may
be found on Anaconda's website (www.anacondamining.com) and on its SEDAR profile (www.sedar.com).

Anaconda President and CEO, Dustin Angelo, stated, 'Fiscal 2011 was a
very challenging year for the company from an operational perspective
at Pine Cove. However, the Pine Cove project began to turn around
during the fourth quarter and has continued to progress into the first
quarter of fiscal 2012. As a result, the operational and risk profiles
of the company have changed dramatically. Now that Pine Cove is
operating consistently, we expect to leverage our success by spending
more time in fiscal 2012 on strategic initiatives, like exploration and
M&A activities, that can build long term value in the Company.'

OPERATIONAL HIGHLIGHTS

Pine Cove gold mine, Baie Verte, Newfoundland:

The Pine Cove project demonstrated steady improvement throughout fiscal
2011, which manifested itself in the quarter over quarter increase in
gold sales volume. From the first quarter through the fourth quarter,
there was a strong upward trend in quarterly sales volume for the
fiscal year as illustrated in the chart below.  In addition, the
Company remained un-hedged, which allowed it to capitalize on rising
gold prices.

Quarterly Sales Chart: Fiscal 2011

Fiscal fourth quarter saw significant improvement in circuit operation,
particularly the solids/solutions separation.  As a result, overall
mill recovery climbed to the mid 70% range during April and May 2011,
versus approximately 50% for the first three fiscals quarters of the
year. Adjustments to the crusher and primary ball mill resulted in
average daily throughput of approximately 904 tonnes per day for the
fourth quarter of fiscal 2011. The following table summarizes the
significant operating improvement statistics for the mill during the
fourth quarter of fiscal 2011:

 ______________________________________________
|                         |   Mar|   Apr|   May|
|_________________________|______|______|______|
|Calendar days            |    31|    30|    31|
|_________________________|______|______|______|
|Operating days           |    21|    28|    29|
|_________________________|______|______|______|
|Availability             |   69%|   93%|   92%|
|_________________________|______|______|______|
|Dry tonnes processed     |16,586|26,997|27,735|
|_________________________|______|______|______|
|Tonnes per 24-hour day   |   775|   968|   972|
|_________________________|______|______|______|
|Grade                    |  1.85|  1.85|  1.72|
|_________________________|______|______|______|
|PC only plant recovery(1)|   62%|   70%|   78%|
|_________________________|______|______|______|

    From the middle of March until the middle of April, Pine Cove was
    conducting a trial with Rambler Metals and Mining where it was
(1) shipping its gold concentrate to the Nugget Pond mill for
    processing. The PC only plant recovery represents the metallurgical
    accounting for the days when Pine Cove did not ship concentrate to
    Nugget Pond.

CORPORATE ACTIVITY

The following summarizes the corporate activity in which Anaconda was
involved during fiscal 2011.

Acquisitions:

    --  During the first fiscal quarter of 2011, Anaconda completed
        transactions to acquire interests in two iron exploration
        portfolios from a private Chilean company, Inversiones SBX
        Limitada ('SBX'). The exploration properties are located in
        north central Chile, within the Chile-Peru iron ore belt.
        Anaconda acquired a 50% interest in iron exploration
        concessions located in the immediate area of the Company's San
        Gabriel iron project and a 20% interest in Inversiones Hierro
        Antofagasta S.A. ('IHA'), a private Chilean company; and
    --  In January 2011, Anaconda closed the acquisition of the 40%
        interest in Pine Cove owned by New Island Resources. The
        Company issued a total of 22,602,315 shares to acquire the
        asset. The closing price of Anaconda shares on January 13,
        2011, was $0.14, resulting in a fair value of $3,164,324.

Financing related:

    --  In May 2011, Anaconda completed a rights offering to holders of
        its common shares issuing 31,686,444 common shares pursuant to
        the rights offering and raising gross proceeds of $2,218,051. 
        Net proceeds after expenses were released to Anaconda and were
        used for working capital and debt reduction purposes;
    --  Subsequent to year-end, in June 2011, the Company closed a
        non-brokered private placement of 16,999,728 common shares at
        $0.07 per share. The common shares were issued, in part, to
        retire $1,049,981 of promissory notes (see below) including
        accrued interest thereon, that were coming due at the end of
        June 2011. The remainder of the common shares issued generated
        gross cash proceeds of approximately $140,000. In addition, the
        Company issued on a non-brokered private placement basis,
        1,394,000 flow-through common shares issuable pursuant to the
        private placement raising additional proceeds of $97,580;
    --  During the last half of fiscal 2011, the Company issued
        $2,526,700 of face-value promissory notes with expiry date of
        March 31, 2011, at a discount to face value of 90.9%, raising
        proceeds of $2,297,000 that it used for working capital
        purposes. Repayment of $75,000 was made in March 2011, prior to
        maturity. On March 31, 2011, the Company came to an agreement
        with the holders of the promissory notes to extend the maturity
        date to June 29, 2011 and June 30, 2011, with interest accruing
        at 15% per annum from April 1, 2011 to maturity. On May 3,
        2012, 20,673,870 common shares were issued pursuant to the
        Rights Offering retiring $1,447,171 of outstanding promissory
        notes balance. On June 3, 2011, the Company issued 14,999,728
        common shares pursuant to the June 2011 Private Placement in
        settlement of the remaining outstanding promissory note balance
        plus accrued interest thereon;
    --  The Company extended the maturity date of its unlisted common
        share purchase warrants with expiry dates of April 23, 2011,
        May 11, 2011 and July 25, 2011, for all non-insider holders. 
        The expiry dates of the share purchase warrants were extended
        by one year; and
    --  Subsequent to year-end, Anaconda reached an agreement with the
        holders of its 12.5% Series III Debentures to extend the
        maturity date from July 20, 2011 to April 20, 2012, subject to
        a principal payment of $150,000 on October 20, 2011.  As part
        of the agreement, the Company has agreed to reduce the exercise
        price of 258,227 unlisted common share purchase warrants
        originally issued to such debenture holders from $0.30 to $0.08
        per common share as well as extend the exercise date by one
        year.

FINANCIAL OVERVIEW

    --  Precious metals sales for the year and fourth quarter ended May
        31, 2011, were $7.325 million and $3.415 million, respectively;
    --  Sales were offset by $8.782 million ($2.833 million for the
        fourth quarter) for costs of goods sold;
    --  Administrative expenses were $4.075 million for the year and
        $0.536 million over the 3 months ended May 31, 2011;
    --  Consolidated net loss for the year and fourth quarter ended May
        31, 2011 was approximately $11.417 million ($0.096 per basic
        and fully diluted share) and $1.085 million ($0.008 per basic
        and fully-diluted share), respectively;    
    --  As at May 31, 2011, Anaconda had cash and cash equivalents of
        $1,533,467, of which $677,499 was restricted for
        letters-of-credit guarantees regarding asset retirement
        obligations of the Company regarding its Pine Cove site
        development plan and $565,086 held in a debt-reduction escrow
        account to be utilized for debt service and/or principal
        repayments to Anaconda's Series I debenture holders; and
    --  As at May 31, 2011, Anaconda had a working capital deficiency
        of approximately $5.187 million.  Anaconda utilized the
        proceeds from its precious metals sales over the year together
        with funds raised throughout the year to fund its working
        capital and capital expenditure requirements.

ABOUT ANACONDA

Headquartered in Toronto, Canada, Anaconda is a mining and exploration
company focused on operating the Pine Cove gold mine located on the
Baie Verte Peninsula in Newfoundland, Canada and advancing the
exploration and development of its iron ore portfolio in Chile with its
joint venture partner, Inversiones SBX Limitada.

FORWARD LOOKING STATEMENTS

This document contains or refers to forward-looking information. Such
forward-looking information includes, among other things, statements
regarding targets, estimates and/or assumptions in respect of future
production, mine development costs, unit costs, capital costs, timing
of commencement of operations and future economic, market and other
conditions, and is based on current expectations that involve a number
of business risks and uncertainties. Factors that could cause actual
results to differ materially from any forward-looking statement
include, but are not limited to: the final approval of the private
placement by the Toronto Stock Exchange; the grade and recovery of ore
which is mined varying from estimates; capital and operating costs
varying significantly from estimates; inflation; changes in exchange
rates; fluctuations in commodity prices; delays in the development of
the any project caused by unavailability of equipment, labour or
supplies, climatic conditions or otherwise; termination or revision of
any debt financing; failure to raise additional funds required to
finance the completion of a project; and other factors. Additionally,
forward-looking statements look into the future and provide an opinion
as to the effect of certain events and trends on the business.
Forward-looking statements may include words such as 'plans,' 'may,'
'estimates,' 'expects,' 'indicates,' 'targeting,' 'potential' and
similar expressions. These forward-looking statements, including
statements regarding Anaconda's beliefs in the potential
mineralization, are based on current expectations and entail various
risks and uncertainties. Forward-looking statements are subject to
significant risks and uncertainties and other factors that could cause
actual results to differ materially from expected results. Readers
should not place undue reliance on forward-looking statements. These
forward-looking statements are made as of the date hereof and we assume
no responsibility to update them or revise them to reflect new events
or circumstances, except as required by law.

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Company website: www.anacondamining.com