The fair value of investments in equity securities classified as available for sale is determined using bid prices at the balance sheet date with any unrealized gains or losses recognized in other comprehensive income. The fair value of ARS investments is determined based on third party valuation and other observable variables, which are discussed in Note 6. Commodity contracts are valued by determining the difference between contractual forward rates and the current forward prices for the residual maturity of the contracts. When in a gain position, the fair value of the contracts is discounted to the balance sheet date using the 12 month LIBOR rate at that date, plus a spread representing the risk premium of the counterparty. When in a loss position, a spread representing the risk premium of Northgate is added to LIBOR for the discounting of the fair value of the contracts. The change in fair value of the forward contracts recognized in the results from operations was $30,920,000 for the three months ended March 31, 2008, which includes amounts settled during the period. Note 10 Segmented Information In prior years, the Corporation considered itself to operate in a single segment being gold and copper mining and related activities including exploration, development, mining and processing in Canada. In the current period, the Corporation has identified separate segments for financial reporting. The Corporation's primary segment reporting basis is by individual mine as the assessment of performance and resource allocation decisions are made on the same basis. The Corporate segment includes costs incurred for corporate activity in both Canada and Australia as well as revenues and costs that are not attributable to the individual mines for performance assessment. Hedging activity and exploration costs are also included in the Corporate segment as the decisions concerning these expenditures are approved at the senior management level. The operating segment results for the three months ending March 31, 2008 are as follows: Foster- Kemess Stawell ville Corporate Total ------------------------------------------------------------------------- Revenues $ 104,016 $ 11,739 $ 4,398 $ (34,060) $ 86,093 Depreciation 7,745 3,387 1,667 52 12,851 Exploration 219 412 175 5,355 6,161 Net interest revenue 200 44 26 3,342 3,612 Earnings (loss) from operations, before tax 47,039 683 (3,781) (22,195) 21,746 ------------------------------------------------------------------------- Capital Expenditures 1,789 2,622 2,596 90 7,097 Goodwill (1) - - - 70,783 70,783 Total Assets 194,532 145,681 145,857 229,555 715,625 ------------------------------------------------------------------------- ------------------------------------------------------------------------- (1) In finalizing the purchase price allocation for the acquisition of Perseverance, the goodwill will be allocated to the reporting units to which it relates. This process is still in progress and will be updated in future periods. Metal sales and mineral property, plant and equipment per geographical region for the three months ending March 31, 2008, are as follows: Mineral property, plant and equipment, Metal Sales and goodwill Dec. 31, Q1 2008 Q1 2007 Q1 2008 2007 ------------------------------------------------------------------------- Canada $ 69,956 $ 74,313 $ 185,969 $ 121,337 Australia 16,137 - 255,774 - ------------------------------------------------------------------------- $ 86,093 $ 74,313 $ 441,743 $ 121,337 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Metal sales are disclosed net of the effect of hedging. The Corporation has a multi-year agreement with Xstrata for the shipment and sale of Kemess gold-copper concentrate. The Corporation has a similar arrangement with AGR Matthey for gold dore bars produced at the Fosterville and Stawell mines. Note 11 New Accounting Pronouncements Goodwill and Intangible Assets In February 2008, the CICA issued Section 3064, Goodwill and Intangible Assets which replaces Section 3062, Goodwill and Other Intangible Assets and Section 3450, Research and Development Costs. The new section establishes standards for the recognition, measurement and disclosure of goodwill and intangible assets and harmonizes this standard with International Financial Reporting Standard IAS 38, Intangible Assets. The new requirements are effective for fiscal years beginning on or after October 1, 2008. The Corporation is in the process of assessing the effect this new standard will have on its results of operations of financial position. Conversion to International Financial Reporting Standards On February 13, 2008, the Accounting Standards Board announced that publicly accountable entities will be required to prepare financial statements in accordance with International Financial Reporting Standards (IFRS) for interim and annual financial statements for fiscal years beginning on or after January 1, 2011. The Corporation is currently assessing the impact of the conversion on the consolidated financial statements and disclosures and will develop a conversion implementation plan. DATASOURCE: Northgate Minerals Corporation CONTACT: PRNewswire - - 05/02/2008

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