Orbit Garant 2012 annual rep O rt 15 Iron ore Iron ore prices are determined by the global demand for steel, as more than 95% of mined iron ore is used for steel making. At the time of this report, iron ore prices had declined to approximately US$95 per tonne from approximately US$177 per tonne a year ago, primarily as a result of decreased demand in China, the world’s largest consumer of iron ore. Market participants With higher non-ferrous metals prices since the market downturn in late 2008 and early 2009, the mining industry has remained relatively healthy. Intermediate and junior companies, which were conserving cash during the market downturn in 2009, increased their expl oration spending in 2010 and 2011 as non-ferrous metals prices rebounded and access to capital improved. However, continued global ec onomic uncertainty in 2012 has made it more challenging for intermediates and juniors to raise capital, which has resulted i n budget restraint and scaled back exploration programs. Rising costs of mineral production are also causing mining companies to review explorati on and capital budgets. According to MEG, signifcant fnancings (> US$2 million) for gol d and base metals projects in the May–June, 2012 period declined more than 21% from the corresponding two-month period in 2011. OVERALL PERFORMANCE R ESULTS OF OPERATION YEAR ENDED J UNE 30, 2012 Fiscal year ended June 30 2012 vs. 2011 Variation * ($ millions) Fiscal 2012 Fiscal 2011 Variation (%) Revenue* 154.8 127.7 27.1 21.2 Gross proft* 33.7 28.5 5.2 18.2 Gross margin (%) 21.8 22.3 (0.5) Adjusted gross margin (%) (1) 27.3 27.6 (0.3) EBITDA* (2) 27.9 26.0 1.9 7.4 Metres drilled 1,489,658 1,413,332 76,326 5.4 Net earnings* 10.4 11.4 (1.0) (9.5) Net earnings per common shares – Basic ($) 0.31 0.35 – Diluted ($) 0.30 0.34 (1) Refects gross margin, excluding amortization expenses. (See “Reconciliation of non-IF RS fnancial measures”) (2) EBITDA = Earnings before interest, taxes, depreciation and amortization. (See “Reconci liation of non-IFRS fnancial measures”) $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 May- 10 Jun- 10 Jul-10 Au g- 10 Sep- 10 Oc t- 10 Nov- 10 De c- 10 Ja n-11 Feb-1 1 Mar- 11 Ap r-11 May- 11 Jun- 11 Jul-11 Au g- 11 Sep- 11 Oc t- 11 Nov- 11 De c- 11 Ja n-12 Feb-1 2 Mar- 12 Ap r-12 May- 12 Jun- 12 Amount Rais ed ( US$ mil) 0 75 150 225 Nu mb er of Fi nancings Co mplete d Gold Financings Base Metals Financings Number of Financings Completed S ource: Metals Economics Group Industry Monitor; Exploration Activity Service s Significant Junior and Intermediate Financings Completed