Callinan Mines Releases Q3 Financial Statements

VANCOUVER, June 2 /PRNewswire-FirstCall/ - Callinan Mines is pleased to report strong financial performance in the nine months ended March 31, 2011.

                                                   Nine Months   Nine Months
                                                    March 2011    March 2010
    Operating summary
    Revenue                                        $23,665,470   $12,055,162
    Operating Income                               $20,618,457   $10,318,982
    Net earnings                                   $16,226,453   $10,457,482

    -------------------------------------------------------------------------

    Financial position

    Working capital(i)                             $38,126,041   $20,065,749

    Available cash                                 $29,072,414   $13,248,446

    -------------------------------------------------------------------------

    Per share
    Basic
    Average number of voting shares outstanding     45,952,972    44,831,088
    Net income per share                                 $0.35         $0.23

    Diluted
    Average number of shares outstanding            46,847,212    45,219,801
    Net income per share                                 $0.35         $0.23

    -------------------------------------------------------------------------

    (i) Working capital consists of current assets less current liabilities

During the quarter ending March 31, 2011, Callinan received a total of $13 million from HudBay, including an adjustment payment of $6.2 million received in the month of March. The payment was made to account for an error in calculation discovered by HudBay. The company considers this payment to be an extraordinary occurrence. Net income for the quarter after tax accruals was $9.7 million, or $0.21 per share. Callinan's total year to date revenue is $23.6 million with net income of $16.2 million or $0.35 per share. The company currently has $38 million in working capital and $29 million in available cash.

Spin-Out Meeting

Callinan wishes to remind its shareholders and any interested parties that a special meeting of shareholders will be convened on Tuesday the 7th of June at the Four Seasons Hotel in Vancouver at 11:00 a.m. At this meeting, the shareholders will vote on a proposal that will see Callinan's exploration assets re-organized into a new company (Callinex Mines Ltd.) to be given to Callinan's shareholders on the basis of 1 share for every 4.5 shares of Callinan. Following the spin-out, Callinan Mines will continue to conduct business as a royalty-focused mineral company under the name Callinan Royalties, and Callinex will be an exploration company.

    On Behalf of the Board of Directors,

    Mike Muzylowski

    Mike Muzylowski

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

Some statements in this news release contain forward-looking information. These statements include, but are not limited to, statements with respect to future expenditures. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, among others, the ability to complete contemplated work programs and the timing and amount of expenditures. Callinan does not assume the obligation to update any forward-looking statement.

CONTACT: Braden Maccke, 736 Granville Street, Suite 110, Vancouver, BC, V6Z 1G3, Telephone: (604) 605-0885, Toll-Free: 1-877-228-5210, Fax: (604) 605-0886, Email: [email protected], Website: www.callinan.com

SOURCE Callinan Mines Ltd.