COEUR D'ALENE, Idaho, Jan. 16, 2007 (PRIME NEWSWIRE) -- Timberline Resources Corporation (OTCBB:TBLC) today announced consolidated financial results for 2006. It was Timberline's first fiscal year as an operating company, with nearly seven months that include its contract drilling subsidiary, Kettle Drilling, Inc. ("Kettle"). For the year ending September 30, 2006, Timberline reported gross revenues of $6.47-million and an overall net loss of $1.97-million.
Kettle and its wholly-owned Mexican subsidiary, World Wide Exploration, S.A. de C.V. ("World Wide"), reported combined gross revenues of $6.47-million, a combined gross operating profit of $1.48-million, and a combined overall loss of $0.90-million for 2006. The loss reflects costs associated with Kettle's rapid growth and the launch of World Wide. Between March and the September year-end, Kettle sharply ramped up its management team and technical staffing, while purchasing and placing into service three new state-of-the-art computerized drill rigs. World Wide incurred significant costs for staffing, training, travel, and permitting, while importing and placing into immediate service three of its own drill rigs (and related equipment) in Mexico.
Timberline's exploration business and main corporate office reported a net loss of $1.07-million for 2006. The loss reflects costs related to the Kettle acquisition, the amortization of certain Kettle assets, and a significant increase in administrative expenses. It also reflects exploration-related expenditures of $0.53-million.
Timberline's 2006 Annual Report was filed with the SEC on Form 10KSB on January 16, 2007. It can be viewed in its entirety on the SEC website which can be accessed from the "Investors" page of the Timberline website at www.timberline-resources.com.
Timberline Chairman and CEO John Swallow stated, "In 2006, we made great progress toward implementation of our revenue-backed exploration business model. As planned, cash flow from drilling operations has been reinvested into the drilling business and deployed toward high-potential mineral exploration ventures. Although we are continuing with our aggressive growth plans at Kettle into fiscal 2007, we currently expect to demonstrate profitability by mid-year. We continue to build a unique investment vehicle within the junior resource sector, providing shareholders with the opportunity to participate in the ongoing mining and mineral exploration booms without the degree of risk inherent to mine operation and/or sole reliance on speculative early-stage drill-plays."
In 2006, Timberline reached the following important milestones:
* Began operations as a contract drilling company with the acquisition of Kettle Drilling, Inc. * Hired Paul Dircksen as VP of Exploration. * Hired Mark Church and Bill Higgins for management positions at Kettle. * Acquired the East Camp Douglas gold property in Nevada. * Gained NASD approval for trading on the OTC Bulletin Board. * Expanded drilling operations into Mexico through the creation of World Wide Exploration, S.A. de C.V. * Acquired the Conglomerate Mesa gold property in California. * Hired Mike Wilson as CFO. * Achieved successive quarterly revenue records at Kettle. * Paid back $400,000 of the Notes related to the Kettle acquisition.
Looking forward to 2007, Timberline recently completed a $2.73-million financing, proceeds from which will be used to finance the purchase of four additional drill rigs for Kettle, to fund exploration programs, and for general corporate purposes. The new rigs will be staged into service from February through May of 2007 and are expected to generate approximately $6-million in combined annualized revenues, contributing to an overall 2007 revenue projection exceeding $15-million. Kettle and World Wide currently have 11 drill rigs in the field, serving several prominent companies including Newmont Mining, Barrick Gold, Industrias Penoles, and U.S. Gold. The current market demand for top-tier contract drillers such as Kettle is virtually unprecedented.
On the exploration side, the 2007 budget has been set at $660,000, with the largest allocations made to the district-scale Conglomerate Mesa project (exploration plans for which will be announced shortly) and to additional project generation. As stated previously, Timberline evaluates exploration opportunities on a case-by-case basis, with a firm intention of partnering with qualified companies on many of its projects.
For more information about Timberline, please visit the Company's website at www.timberline-resources.com.
Timberline Resources Corporation is a unique, growth-oriented company that combines positive cash flow from its ownership of Kettle Drilling, Inc. with "blue sky" upside from its mineral exploration division. Timberline common stock is quoted on the OTC Bulletin Board under the symbol "TBLC."
Statements contained herein that are not based upon current or historical fact are forward-looking in nature. Such forward-looking statements reflect the Company's expectations about its future operating results, performance and opportunities that involve substantial risks and uncertainties. When used herein, the words "anticipate," "believe," "estimate," "plan," "intend" and "expect" and similar expressions, as they relate to Timberline Resources Corporation, or its management, are intended to identify such forward-looking statements. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company's actual results, performance, prospects, and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, such factors, including risk factors, discussed in the Company's Annual Report on Form 10-KSB, as amended, for the year ended September 30, 2006. Except as required by the Federal Securities law, the Company does not undertake any obligation to release publicly any revisions to any forward-looking statements to reflect.