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China Shen Zhou Mining & Resources, Inc. Announces Financial Results for the Second Quarter Ended June 30, 2010


(All figures are in U.S. dollars)

BEIJING, Aug. 10 /PRNewswire-Asia-FirstCall/ -- China Shen Zhou Mining & Resources, Inc. ("China Shen Zhou", or the "Company") (Amex: SHZ), a leading Company engaged in the exploration, development, mining and processing of fluorite, zinc, lead, copper, and other nonferrous metals in China, today announced the financial results for the second quarter ended June 30, 2010.

Second Quarter 2010 Highlights:

Total net revenues increased by 210% in the second quarter of 2010 as compared to the same period in 2009 to US$2.2 million from US$0.7 million.

Gross profit increased by approximately 180% in the second quarter of 2010 as compared to the same period in 2009 to US$0.45 million from US$0.16 million.

Net loss attributable to the Company and subsidiaries decreased by approximately 70% in the second quarter of 2010 as compared to the same period in 2009 to US$0.5 million from US$1.7 million.

Net Loss from operations decreased by approximately 69% in the second quarter of 2010 as compared to the same period in 2009 to US$0.5 million from US$1.6 million.

Basic and diluted net loss per share from continuing operations was US$0.02 in the second quarter of 2010 and US$0.07 in the second quarter of 2009.

"I am proud of how our team executed our plans in the second quarter and first half of 2010. While global economic conditions continue to appear sluggish, we posted good results in the second quarter," said Ms. Xiaojing Yu, the Chairwoman and CEO of the Company. "We remain focused on executing our growth strategy by increasing the production of fluorite and exploration of new resources to achieve our financial target of 2010."

About China Shen Zhou Mining & Resources, Inc.

China Shen Zhou Mining & Resources, Inc., through its subsidiary, American Federal Mining Group ("AFMG"), is engaged in the exploration, development, mining, and processing of fluorite and nonferrous metals such as zinc, lead and copper in China. The Company has the following principal areas of interest in China: (a) fluorite extraction and processing in the Sumochaganaobao region of Inner Mongolia; (b) zinc/copper/lead exploration, mining and processing in Wulatehouqi of Inner Mongolia; and (c) zinc/copper exploration, mining and processing in Xinjiang.

For more information, please visit http://www.chinaszmg.com/

Safe Harbor Statement

Certain of the statements made in the press release constitute

forward- looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology. Such statements typically involve risks and uncertainties and may include financial projections or information regarding our future plans, objectives or performance. Actual results could differ materially from the expectations reflected in such forward-looking statements as a result of a variety of factors, including the risks associated with the effect of changing economic conditions in the People's Republic of China, variations in cash flow, fluctuation in mineral prices, risks associated with exploration and mining operations, and the potential of securing additional mineral resources, and other risk factors detailed in reports filed with the Securities and Exchange Commission from time to time.

For more information, please contact:

In China:

Fulun Song

Office of the Board of Directors

China Shen Zhou Mining & Resources, Inc.

Tel: +86-10-8890-9976

Fax: +86-10-8890-6927

Email: investors@chinaszky.com

Web: http://www.chinaszmg.com

In the U.S.:

David Elias

Investor Relations

DME Capital LLC

Tel: +1-516-967-0205

Email: dave@dmecapital.com

Financial Tables to Follow

CHINA SHEN ZHOU MINING & RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

June 30, December 31,

2010 2009

(Unaudited) (Audited)

ASSETS

Current assets:

Cash and cash equivalents $463 $333

Accounts receivable, net 274 302

Other deposits and prepayments, net 1,026 855

Inventories 6,594 3,721

Restricted assets 8 740

Total current assets 8,365 5,951

Prepayment for office rent 198 280

Available for sale investment 147 146

Property, machinery and mining assets, net 34,098 34,902

Total assets $42,808 $41,279

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable $3,163 $4,694

Short term bank loans 7,931 3,603

Other payables and accruals 6,135 6,667

Taxes payable 379 333

Total current liabilities 17,608 15,297

Due to related parties 2,047 2,297

Total liabilities 19,655 17,594

STOCKHOLDERS' EQUITY:

Common stock ($0.001 par value; 50,000,000

shares authorized; 27,974,514 shares and

27,214,514 shares issued and outstanding

as of June 30, 2010 and December 13, 2009

respectively) 28 27

Additional paid-in capital 29,270 28,518

Statutory reserves 1,672 1,672

Accumulated other comprehensive income 3,885 3,839

Accumulated deficit (11,658) (10,342)

Stockholders' equity - China Shen Zhou Mining &

Resources, Inc. and Subsidiaries 23,197 23,714

Noncontrolling interest (44) (29)

Total stockholders' equity 23,153 23,685

Total liabilities and stockholders' equity $42,808 $41,279

CHINA SHEN ZHOU MINING & RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(Amounts in thousands, except per share data)

For the Three Months Ended For the Six Months Ended

June 30, June 30, June 30, June 30,

2010 2009 2010 2009

(Unaudited) (Unaudited) (Unaudited) (Unaudited)

Net revenue $2,182 $726 $3,103 $1,345

Cost of sales 1,729 566 2,577 1,123

Gross profit 453 160 526 222

Operating expenses:

Selling and

distribution

expenses 38 14 51 18

General and

administrative

expenses 834 793 1,911 2,184

Total operating

expenses 872 807 1,962 2,202

Net loss from

operations (419) (647) (1,436) (1,980)

Other income

(expense):

Interest expense (108) (997) (194) (1,959)

Other, net 13 22 300 117

Total other loss (95) (975) 106 (1,842)

Loss from continuing

operations before

income taxes (514) (1,622) (1,330) (3,822)

Income tax expenses -- -- -- --

Loss from continuing

operations (514) (1,622) (1,330) (3,822)

Discontinued

operations:

Loss from operations

of discontinued

component, net of

taxes -- (88) -- (246)

Loss from

discontinued

operations -- (88 -- (246)

Net loss (514) (1,710) (1,330) (4,068)

Less: Noncontrolling

interests attributable

to the noncontrolling

interests 9 44 14 22

Net loss - attributable

to China Shen Zhou

Mining & Resources,

Inc. and Subsidiaries (505) (1,666) (1,316) (4,046)

Other comprehensive

income:

Foreign currency

translation

adjustments 66 (5) 46 186

Comprehensive income

(loss) $(439) $(1,671) $(1,270) $(3,860)

Net loss per common

share - basic

and diluted

From continuing

operations (0.02) (0.07) (0.04) (0.17)

From discontinued

operations -- (0.00) -- (0.01)

$(0.02) $(0.07) $(0.04) $(0.18)

Weighted average

common shares

outstanding

- Basic and Diluted 27,975 22,215 27,852 22,215

CHINA SHEN ZHOU MINING & RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands, except share data)

For the Six Months Ended

June 30,

2010 2009

(Unaudited) (Unaudited)

Cash flows from operating activities:

Net loss $(1,316) $(4,046)

Adjustments to reconcile net loss to net cash

used in operating activities:

Loss from operations of discontinued

component, net of income tax benefits -- 246

Depreciation and amortization 1,365 1,357

Fair value adjustment of warrants -- 60

Accrual of coupon interests and accreted

principal -- 774

Amortization of deferred financing costs -- 802

Amortization of debt issuance costs -- 211

Noncontrolling interests (15) (22)

Forgiveness of payroll payables (300) --

Changes in operating assets and liabilities:

(Increase) decrease in -

Accounts receivable 28 (224)

Other deposits and prepayments (171) (270)

Prepayment for office rent 82 105

Inventories (2,873) (279)

Restricted assets 732 (359)

Increase (decrease) in -

Accounts payable (1,531) 321

Other payables and accruals 528 514

Taxes payable 46 (264)

Net cash used in operating activities

from continuing operations (3,425) (1,075)

Net cash used in operating activities

from discontinued operations -- 71

Net cash used in operating activities (3,425) (1,004)

Cash flows from investing activities:

Purchases of property, machinery and

mining assets (461) (385)

Net cash used in investing activities from

continuing operations (461) (385)

Net cash provided by disposal of discontinued

operations -- --

Net cash provided by (used in) investing

activities (461) (385)

Cash flows from financing activities:

Repayment at the convertible notes --

Due to related parties (250) (440)

Repayment at short-term bank loans (2,732) --

Proceeds from short-term bank loans 7,050 1,874

Net cash (used in) provided by financing

activities 4,068 1,434

Foreign currency translation adjustment (52) (3)

Net increase in cash and cash equivalents 130 42

Cash and cash equivalents at the beginning of

the period 333 205

Cash and cash equivalents at the end of the

period $463 $247

Non-cash investing and financing activities

Shares issued to employees as share based

compensation $752 $--

Supplemental disclosures of cash flow

information:

Cash paid for interest expenses $162 $ 47

Cash paid for income tax $-- $--

Source: China Shen Zhou Mining & Resources, Inc.
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Keywords: Mining/Metals
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