Yellowhead Mining Inc. Reports Financial and Operating Results for Three and Five Months Ended March 31, 2012

TSX-V:YMI

VANCOUVER, May 14, 2012 /CNW/ - Yellowhead Mining Inc. ("Yellowhead" or the "Company") (TSX.V: YMI) is pleased to report its results of operations for the three and five months ended March 31, 2012.

For the full five 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 and Outlook:

• Detailed Feasibility Study was completed and filed on March 29, 2012;
• Released an updated Resource estimate with contained copper within the Measured and Indicated Resource categories at a 0.2% copper cut-off grade increasing by 1.67 billion pounds or 47% compared to the previously completed estimate in the Preliminary Economic Assessment at a 0.2% copper cut-off grade;
• Based on the updated Resource estimate at a 0.2% copper cut-off grade the Measured and Indicated Resources are:  Copper - 5.3 billion pounds, Gold - 838,600 ounces and Silver - 34 million ounces;
• In support of the Feasibility Study and to expand the resource, the Company completed a total of 15,148 metres of drilling during the 2011 drilling campaign including:
• Resource confirmation: 33 holes for a total of 8,191m
• Condemnation: 8 holes for a total of 1,791m
• Resource expansion: 11 holes for a total of 4,725m
• Metallurgical sampling: 4 holes for a total of 441m;
• The Environmental Assessment study at Harper Creek was advanced with an ongoing comprehensive baseline study program;
• 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.

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 five months ended March 31, 2012, were as follows:

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

The Company's administrative expenses for the three months ended March 31, 2012, were in line with the two months ended December 31, 2011.

Exploration costs were lower for the three months ended March 31, 2012 compared to the two months ended December 31, 2011 due to decreased activity as the Company completed its Feasibility Study which was filed March 29, 2012.

Other expenses/(income) for the three months ended March 31, 2012, were in line with the two months ended December 31, 2011.

Cash and Cash Equivalents

The Company had cash and cash equivalents of $8,282,887 as at March 31, 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, and pursue funding activities to develop the Harper Creek project. The Company believes that it has sufficient funds on hand to advance through the permitting process.

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 15 of the Company's condensed consolidated interim financial statements for the five months ended March 31, 2012.

Fiscal year end change

The Company is prospectively changing its fiscal year end date from October 31^st to December 31^st.  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).

Ian Smith, President & CEO of the Company and a Qualified Person under NI 43-101, has reviewed and approved the technical content of this press release.

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 Venture Exchange Inc. 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.

SOURCE Yellowhead Mining Inc.