Homestake Reports Q1 Loss of $0.05 Per Share Due Mainly to Non-Recurring Non-Cash Foreign Currency Adjustments; Gold Production, Cash Costs on Target for Another Record Year.

Apr 26, 2001, 01:00 ET from Homestake Mining Company

    WALNUT CREEK, Calif., April 26 /PRNewswire/ -- (Note:  All financial
 information is reported in US dollars unless stated otherwise)
     (Photo:  http://www.newscom.com/cgi-bin/prnh/19990326/HMLOGO
              http://www.newscom.com/cgi-bin/prnh/19990329/HMTHOMPSON )
 
     First quarter 2001 summary:
     -- Net loss $12.0 million, compared to net loss of $16.3 million for the
        corresponding 2000 period.  The losses were primarily due to non-cash
        charges related to further weakening of the Australian and Canadian
        dollars against the US dollar.  Net loss per share was $0.05, a
        $0.01 per share improvement over Q1 2000.
     -- Net income before non-recurring items $0.1 million or $0.00 per share
        compared to net loss of $1.9 million or $0.01 per share in Q1 2000,
        despite a $21 per ounce reduction in the average realized price of
        gold.
     -- Cash flow from operations $14.5 million, compared to $38.0 million in
        the first quarter of 2000.
     -- Total attributable gold production 579,200 ounces or 51,100 ounces more
        than in the first quarter of 2000.
     -- Average cash cost $173 per ounce or $8 per ounce lower than in the same
        quarter of 2000.
     -- Year 2001 attributable gold production is forecast at an all-time
        record 2.3 million ounces.  Cash costs are expected to average $163 per
        ounce, a 24-year low.
 
     Homestake Mining Company (NYSE:   HM; Australia: HSM; Toronto: HCX) today
 reported a net loss of $12 million for the first quarter of 2001, compared to
 a net loss of $16.3 million for the corresponding quarter of 2000.  Net loss
 per share in the first quarter of 2001 was $0.05 per share, a $0.01 per share
 improvement over the same period a year earlier.
     The 2001 first quarter net loss was due to after-tax charges of
 $14.5 million composed mainly of the non-cash impact of the weakening
 Australian and Canadian dollars in relation to the US dollar on inter-company
 loans denominated in those currencies.  Net income for the corresponding
 2000 period included similar currency-related charges.
     In the 2001 first quarter, Homestake recorded a gain of $2.4 million
 (primarily related to the sale of relevant data) as a result of subleasing its
 Just-in-Case property in Western Australia to the neighboring Granny Smith
 joint venture.  Homestake received A$5 million upon signing the agreement and,
 subject to government approval, will receive, unless deferred, additional
 payments of A$7.5 million no later than December 31, 2003, and A$12.5 million
 no later than December 31, 2008.  Homestake will also receive a 3.5% net
 smelter return royalty (NSR) on all production from the Just-in-Case sublease
 and an additional payment of up to A$13 million, subject to a maximum
 production limit and creditable against the NSR, if production from the
 Just-in-Case deposit is not completed by June 30, 2010.
     Before allowing for the non-recurring items, Homestake generated after-tax
 net income of $0.1 million or $0.00 per share in the 2001 first quarter,
 compared to a net loss of $1.9 million or $0.01 per share in the same period
 of 2000.
     In the first quarter 2001, Homestake produced 579,200 ounces of gold at an
 average cash cost of $173 per ounce, or 51,100 more ounces of gold at an
 average cash cost of $8 dollars per ounce less than in the same period a year
 earlier.  The higher production and lower cash costs were mostly due to the
 July 2000 acquisition of an additional 25% interest in the Round Mountain
 mine, which produced approximately 40% more gold (100% basis) at cash costs
 33% lower than in the corresponding quarter a year ago.
     "Homestake continues to build upon its strong operating base," said Jack
 Thompson, Homestake's Chairman and Chief Executive Officer.  "We are on track
 to mark our 125th year with record gold production and reduced operating
 costs."
     First quarter 2001 cash flow from operations amounted to $14.5 million,
 compared to $38.0 million in the first quarter of 2000.  The decrease in cash
 flows primarily reflects the $21-per-ounce decline in the average realized
 gold price in the first quarter of 2001 compared to 2000.
     Homestake's balance sheet remains strong, with total cash and short-term
 investments of nearly $193.5 million and net debt of $23.8 million.  Despite
 realizing, on average, $21 per ounce of gold less in the first quarter of 2001
 compared to the same period in 2000, Homestake remains one of the financially
 strongest gold mining companies in the world.
     At the end of the first quarter 2001, Homestake's gold hedge book
 consisted exclusively of forward sales contracts totaling 2.1 million ounces
 or approximately 10% of Homestake's proven and probable reserves.  In the 2001
 first quarter, after scheduled deliveries, Homestake added approximately
 500,000 ounces of Australian dollar-denominated forward sale contracts to lock
 in attractive margins for a portion of its annual gold production in
 Australia.  Homestake's US dollar-denominated gold hedge position remained
 unchanged.
 
                                   Operations
 
     Australia
     During the first quarter of 2001, Homestake's 50%-owned Kalgoorlie
 operation, located in Western Australia, produced 196,300 ounces of gold
 (100% basis) at an average cash cost of $199 per ounce, compared to
 192,100 ounces produced in the same period of 2000 at an average cash cost
 of $211 per ounce.  The improved performance was achieved despite several
 power outages and a full relining of a grinding mill at the sulfide treatment
 plant.  In February 2001, Kalgoorlie successfully commissioned a new ultra
 fine grinding (UFG) unit for processing refractory sulfide concentrates.  The
 new facility finely grinds the concentrates, liberating the gold and making it
 amenable to conventional recovery methods.  The UFG facility, the first of its
 kind in this application, will supplement the existing capacity of the Gidji
 roaster to process the increasing quantities of refractory sulfide
 concentrates produced by the mill.  The UFG unit, commissioned on time and on
 budget, is being successfully phased in to the existing circuit and should be
 fully integrated with the other concentrate treatment facilities in the second
 quarter of 2001.
     Homestake's 100%-owned Yilgarn operations in Western Australia, consisting
 of the Darlot, Plutonic, and Lawlers mines, continued to build upon the strong
 momentum they gained in 2000.  In the first quarter of 2001, these mines
 produced 112,600 ounces of gold at an average cash cost of $185 per ounce.
 During the 2000 first quarter, they produced 110,900 ounces at an average cash
 cost of $215 per ounce.
     Gold production at the Plutonic mine in the first quarter of 2001 amounted
 to 55,900 ounces, 2,600 ounces less than in the 2000 first quarter.  The
 difference is largely attributed to a slightly higher in-process gold
 inventory, as mill throughput, grade and recovery were essentially the same in
 both periods.  Cash costs at Plutonic, however, were further reduced.  With
 additional gains in operating efficiency achieved in the first quarter of
 2001, cash costs averaged $190 per ounce, $24 per ounce less than a year ago.
     At Darlot, the newly-installed owner-operated crushing plant reached
 planned throughput levels in the first quarter of 2001.  The mine's
 underground operations are currently being converted from contract to owner
 mining.  The requisite equipment is in the process of being delivered and
 personnel are being recruited.  In the first quarter 2001, the mine produced
 31,800 ounces of gold, compared to 30,400 ounces in the same quarter of 2000.
 Cash costs during the two periods averaged $155 and $222 per ounce,
 respectively, reflecting greater operating efficiencies and higher grades
 achieved during the first quarter of 2001 compared to 2000.
     In February 2001, the Lawlers mine changed mining contractors.  During the
 first quarter 2001, the operation processed 21,100 more tons than during the
 same quarter of 2000, with additional tonnage primarily sourced from the
 lower-grade stockpiled inventory.  Gold production in the 2001 first quarter
 was 24,900 ounces, approximately 2,900 ounces more than a year ago, and cash
 costs averaged $211 per ounce, about $2 per ounce higher than in the 2000
 first quarter.
 
     Canada
     During the first quarter of 2001, the Eskay Creek mine, located in
 northwestern British Columbia, produced 77,100 ounces of gold at an average
 cash cost of $51 per ounce.  During the same period of 2000, the mine produced
 84,400 ounces at $7 per ounce.  The higher cash costs in the 2001 first
 quarter primarily reflected reduced silver by-product credits related to lower
 silver production and the continued weakness in the price of silver compared
 to the first quarter of 2000.  Higher fuel, transportation and mining costs
 have also contributed to the increased operating costs.  The mine has started
 production from the C-zone where orebodies are smaller than in other active
 areas.  Test mining using modified methods has been initiated to lower these
 costs.
     Homestake's 50%-owned Hemlo operation, located in northwestern Ontario,
 consists of a single mill, which processes ore from the David Bell and
 Williams underground mines and an open pit.  In the first quarter of 2001,
 Hemlo produced 153,000 ounces of gold (100% basis) at an average cash cost of
 $211 per ounce.  In the first quarter of 2000, these operations produced
 170,300 ounces at an average cash cost of $195 per ounce.  The 17,300-ounce
 reduction in gold production and the $16 per ounce increase in cash costs in
 the first quarter of 2001 were due to lower-grade ore mined at both the David
 Bell and Williams mines.  The decrease in grade at the Williams mine was
 mainly due to higher amounts of lower-grade material provided by the open pit
 and production from lower-grade underground stopes at both mines.  The effect
 of processing lower-grade material was partially offset by higher throughput
 at the mill, which in the 2001 first quarter processed, on average, an
 all-time record of 10,250 tons of ore per day.
 
     United States
     In the first quarter of 2001, Homestake's 50%-owned Round Mountain mine,
 located in central Nevada, produced 200,700 ounces of gold (100% basis) at an
 average cash cost of $173 per ounce.  Compared to the first quarter of 2000,
 in the 2001 first quarter, Round Mountain produced, on a 100% basis,
 56,800 ounces more gold at an average cash cost of $84 per ounce less.
 Homestake increased its ownership interest in Round Mountain when it acquired
 an additional 25% interest in this large-scale heap leach and milling
 operation in July of 2000.  The mine commissioned eight new 240-ton trucks to
 replace its older 85 and 150-ton capacity fleet.  In the first quarter of
 2001, the operation moved approximately the same tonnage of material as in the
 first quarter of 2000 (26.4 million tons on a 100% basis).  The grade and
 recovery, however, were much higher due to the increased recovery of gold from
 the dedicated pads and to processing of high-grade oxide stockpiles.
     The wholly-owned Ruby Hill mine, located in central Nevada, remains one of
 Homestake's lowest cost producers.  In the first quarter of 2001, it produced
 30,200 ounces of gold at an average cash cost of $108 per ounce, compared to
 28,300 ounces produced at an average cash cost of $106 per ounce in the same
 period of 2000.  This operation will complete mining in December 2002.
     The Homestake mine, scheduled for closure in December 2001, produced
 47,200 ounces of gold in the first quarter of 2001, virtually unchanged from
 the same period of 2000.  Cash costs, however, were reduced to $224 per ounce
 from $275 per ounce in the 2000 first quarter.  The mine is gradually reducing
 its workforce and site costs in accordance with a planned mine-out schedule.
 
     South America
     The 2000-2001 field season at the 60%-owned Veladero project in
 northwestern Argentina is nearing completion.  The drilling program is
 expected to cease by the end of April.  At that time, the camp will be
 winterized and all field activities terminated until the next season, which is
 expected to commence in October 2001.
     During the second quarter, Homestake will focus on continuing the
 metallurgical testing, incorporating and interpreting new results and updating
 the mine planning, process design, permitting, capital, operating cost and
 financial models.  Homestake plans to complete this stage of work by
 July 2001.
 
                           2001 Operating Projection
 
     Homestake expects 2001 to be an excellent year in terms of increased gold
 production and reduced cash and total costs.  The Company forecasts that in
 2001 it will produce a record 2.3 million ounces of gold at average cash and
 total costs of $163 and $230 per ounce, respectively, the lowest in 24 years
 (Table I).
 
 
     Table I:  Detailed 2001 Forecast
 
                                     Attributable*
                         Gross Gold       Gold
     Operation           Production    Production    Cash Cost**  Total Cost**
     (% Homestake)      (000 ounces)  (000 ounces)  ($ per ounce)($ per ounce)
 
     Kalgoorlie (50%)        828.0         414.0          172          215
 
     Yilgarn (100%):         475.2         475.2          173          219
     Plutonic                241.7         241.7          176          220
     Darlot                  130.5         130.5          165          212
     Lawlers                 103.0         103.0          175          227
     Subtotal Australia                    889.2          172          217
 
     Eskay Creek (100%)      313.7         313.7           40          160
     Hemlo (50%)             650.0         325.0          179          215
     Subtotal Canada                       638.7          111          188
 
     Round Mountain (50%)    626.3         313.2          201          269
     Ruby Hill (100%)        130.3         130.3          113          261
     McLaughlin (100%)       110.7         110.7          239          324
     Marigold (33%)           72.3          24.1          199          229
     Homestake (100%)        186.6         186.6          219          295
     Subtotal United States                764.9          196          281
 
     Agua de la Falda (51%)   43.9          22.4          218          248
     Subtotal South America                 22.4          218          248
 
     Total Homestake                     2,315.2          163          230
 
     * Homestake's share of production
     ** Homestake reports its per ounce costs in accordance with the "Gold
        Institute Production Cost Standard"
 
 
     The above forecast is based on average exchange rates of US$0.65 and
 US$0.53 per Canadian and Australian dollar, respectively.  Homestake's
 calendar 2001 capital budget is estimated at $100 million, which includes
 approximately $20 million for Homestake's share of work at Veladero.
 Approximately 55% of the balance is attributed to the upgrading of the truck
 fleet at Round Mountain, conversion to owner mining at Darlot and expansion of
 milling and concentrate treatment facilities at Kalgoorlie.  As the Company
 completes operations at the Homestake mine and scales down production at some
 of its other higher cost operations, its year 2002 gold output is expected
 to be approximately two million ounces, with cash and total costs averaging
 $160 and $229 per ounce, respectively.
     Homestake Mining Company is an international gold mining company with
 operations and exploration activities in the United States, Canada, Australia
 and Chile.  The Company also has active development and exploration programs
 in Argentina.  Shares of the Company's common stock are listed on the New York
 Stock Exchange, the Australian Stock Exchange and the SWX Swiss Exchange.
 Homestake Canada Inc. exchangeable shares are listed on the Toronto Stock
 Exchange.  Homestake began gold mining operations over 120 years ago, and is
 one of the oldest listed companies on the New York Stock Exchange still in its
 original business.  It has received numerous industry awards for its
 responsible environmental health and safety management programs.  For
 additional corporate information, please visit Homestake Mining Company on the
 Internet at http://www.homestake.com.
     CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT.
 This release contains forward-looking statements that are based on
 management's expectations and assumptions.  They include statements preceded
 by the words "believe," "estimate," "expect,"  "intend," "will," and similar
 expressions; estimates of future production; cost estimates; and other
 estimates of future results or activity.  Such statements are "forward-looking
 statements" that involve risks and uncertainties that could cause actual
 results to differ materially from estimated results.  Among the important
 factors that could cause actual results to differ materially are the
 following.  Production may vary from estimates for particular properties and
 for the Company as a whole because of changes in reserves, variation in ore
 mined from estimated grade and metallurgical characteristics, unexpected
 ground conditions, mining dilution, labor actions, and government
 restrictions. Cash costs may vary due to changes from reserve and production
 estimates, unexpected mining conditions, and changes in estimated costs of
 equipment, supplies, utilities, labor costs and exchange rates.  Capital cost
 estimates are based on operating experience, reserve estimates and expected
 production rates, estimates by and contract terms with third party suppliers,
 expected legal requirements, feasibility reports and other factors.  Factors
 involved in estimated time for completion of projects include the Company's
 experience in completing capital projects, estimates by and contract terms
 with contractors, engineers, suppliers and others involved in design and
 construction of projects, and estimated time for the government to process
 applications, issue permits and take other actions.  Changes in any factor may
 cause costs and time for completion to vary significantly from estimates.
 There is a greater likelihood of variation for properties and facilities not
 yet in production due to lack of actual experience.
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                  Condensed Statements of Consolidated Operations
                      (in thousands, except per share amounts)
 
                                                         Three months ended
                                                              March 31,
                                                          2001         2000
     Revenues
       Gold and ore sales                              $165,456     $165,525
       Interest income                                    3,299        5,089
       Other income                                      (9,037)     (12,421)
         Total Revenues                                 159,718      158,193
 
     Costs and Expenses
       Production costs                                 119,944      108,525
       Depreciation, depletion and amortization          35,160       35,506
       Administrative and general expense                11,381       11,121
       Exploration expense                                6,021       10,049
       Interest expense                                   2,828        4,445
       Other expense                                        312          899
         Total Expenses                                 175,646      170,545
 
     Loss Before Taxes and Minority Interests           (15,928)     (12,352)
     Income Taxes                                         3,309       (2,666)
     Minority Interests                                     625          155
     Loss from Continuing Operations                    (11,994)     (14,863)
     Loss from Discontinued Operations                       --       (1,459)
     Net Loss                                          $(11,994)    $(16,322)
 
     Per Share Amounts - Basic and Diluted
     Loss from Continuing Operations                     $(0.05)      $(0.05)
     Loss from Discontinued Operations                       --        (0.01)
     Net Loss Per Share                                  $(0.05)      $(0.06)
 
     Average Shares Used in the Computation             263,273      260,339
 
 
               Components of Loss Before Taxes and Minority Interests
                              (in thousands - pretax)
 
                                                         Three months ended
                                                              March 31,
                                                          2001         2000
     Income (loss) before significant items,
      taxes and minority interests                      $(2,826)      $3,142
     Significant items:
       Sale of Mining Information                         2,430           --
       Foreign exchange losses                          (15,532)     (14,035)
       Loss from discontinued operations                     --       (1,459)
       Total significant items                          (13,102)     (15,494)
     Loss before taxes and minority interests          $(15,928)    $(12,352)
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                       Condensed Consolidated Balance Sheets
                                   (in thousands)
 
                                                       March 31,    Dec. 31,
                                                          2001        2000
     Assets
       Cash and equivalents                            $187,238     $193,422
       Short-term investments                             6,262        6,237
       Other current assets                             135,063      132,546
       Property, plant and equipment - net              901,132      987,812
       Other noncurrent assets                          107,839       99,358
         Total                                       $1,337,534   $1,419,375
 
     Liabilities and Shareholders' Equity
       Accounts payable and accrued liabilities        $129,054     $143,689
       Current portion of deferred gain on
        close-out of forward sales contracts             11,910       12,869
       Current portion of long-term debt                  2,489        2,822
       Long-term debt                                   214,810      224,616
       Other long-term liabilities                      225,026      212,006
       Deferred gain on close-out of forward
        sales contracts                                  20,060       22,223
       Deferred income taxes                            173,945      181,961
       Minority interests in consolidated
        subsidiaries                                      9,595       10,375
       Shareholders' equity                             550,645      608,814
         Total                                       $1,337,534   $1,419,375
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                  Condensed Statements of Consolidated Cash Flows
                                   (in thousands)
 
                                                          Three months ended
                                                               March 31,
                                                           2001        2000
     Operating Activities
       Loss from continuing operations                 $(11,994)    $(14,863)
       Reconciliation to net cash provided by
        operations:
         Depreciation, depletion and amortization        35,160       35,506
         (Gains) loss on investment sales and
          asset disposals                                (2,864)         263
         Deferred taxes, minority interests and other     2,805       (3,796)
         Effect of changes in operating working
          capital items                                  (9,526)      20,480
     Net cash provided by continuing operations          13,581       37,590
     Net cash provided by discontinued operations           928          408
     Net cash provided by operating activities           14,509       37,998
 
     Investment Activities
       Increase in investments                               --      108,214
       Additions to property, plant and equipment       (24,704)     (16,410)
       Proceeds from sale-leaseback of equipment             --        4,755
       Proceeds from asset sales                          7,923          167
       Increase in long-term assets                      (3,099)          --
       Decrease in restricted cash                           --        1,789
     Net cash provided by (used in) investment
      activities                                        (19,880)      98,515
 
     Financing Activities
       Borrowings                                           821           --
       Debt repayments                                     (624)        (977)
     Net cash provided by (used in) financing
      activities                                            197         (977)
 
     Effect of Exchange Rate Changes on Cash and
      Equivalents                                        (1,010)      (1,745)
 
     Net Increase (Decrease) in Cash and Equivalents    $(6,184)    $133,791
 
 
                              HOMESTAKE MINING COMPANY
                                   Hedge Position
 
                                 Expected Maturity or Transaction Date
                                                              There-  Total or
                        2001    2002     2003    2004   2005   after   Average
 
     US $ denominated
     contracts:
      Forward sales
      contracts:
       Ounces          10,000  10,000      --      --  90,000 559,200   669,200
       Average price
       ($ per oz.)       $400    $403     $--     $--    $400    $418      $415
 
     Australian $
     denominated
     contracts: (A)
      Forward sales
      contracts:
       Ounces         333,000 348,800 258,800 228,800 302,000      -- 1,471,400
       Average price
       (US$ per oz.)     $248    $262    $268    $288    $276     $--      $267
 
     (A) Expressed in US dollars at an exchange rate of A$ = US$ 0.4858
 
 
                              Homestake Mining Company
                                 Production Summary
 
                                               First Quarter 2001
                                                                   Homestake's
                                                 100%                  Share
                                      Tons     Average    Ounces      Ounces
                             %      Processed   Grade    Produced    Produced
                          Interest (thousands) (oz/ton) (thousands)(thousands)
     Australia
     Kalgoorlie              50       3,140      0.069     196.3        98.2
 
     Yilgarn:                                                          112.6
       Plutonic             100         855      0.078      55.9        55.9
       Darlot               100         192      0.181      31.8        31.8
       Lawlers              100         187      0.140      24.9        24.9
 
         Subtotal
          Australia                                                    210.8
 
     Canada
     Eskay Creek            100          55      1.577      77.1        77.1
 
     Hemlo (A)               50         923      0.165     153.0        73.7
 
         Subtotal Canada                                               150.8
 
     United States
     Round Mountain          50      16,839      0.019     200.7       100.4
     Ruby Hill              100         287      0.127      30.2        30.2
     McLaughlin             100         650      0.064      29.0        29.0
     Marigold                33       1,216      0.025      19.2         6.4
     Homestake              100         214      0.212      47.2        47.2
         Subtotal
          United States                                                213.2
 
     Chile
     Agua de la Falda        51          46      0.176       8.6         4.4
 
     Total Production                                                  579.2
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                                 Production Summary
 
                                               First Quarter 2000
                                                                   Homestake's
                                                 100%                  Share
                                      Tons     Average    Ounces      Ounces
                             %      Processed   Grade    Produced    Produced
                          Interest (thousands) (oz/ton) (thousands)(thousands)
     Australia
     Kalgoorlie              50       3,089      0.072     192.1        96.1
 
     Yilgarn:                                                          110.9
       Plutonic             100         853      0.078      58.5        58.5
       Darlot               100         180      0.171      30.4        30.4
       Lawlers              100         165      0.138      22.0        22.0
 
         Subtotal
          Australia                                                    207.0
 
     Canada
     Eskay Creek            100          48      1.797      84.5        84.5
 
     Hemlo (A)               50         806      0.208     170.3        82.3
 
         Subtotal Canada                                               166.8
 
     United States
     Round Mountain          25      16,496      0.015     143.9        36.0
     Ruby Hill              100         276      0.126      28.3        28.3
     McLaughlin             100         729      0.066      29.5        29.5
     Marigold                33         633      0.030      20.3         6.7
     Homestake              100         225      0.213      47.7        47.7
         Subtotal
          United States                                                148.2
 
     Chile
     Agua de la Falda        51          71      0.204      11.9         6.1
 
     Total Production                                                  528.1
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                               Operating Cost Summary
 
                                       Total Cash Costs         Total Costs
                                      (dollars per ounce)  (dollars per ounce)
                                        2001       2000       2001       2000
                                         1st        1st        1st       1st
                                       Quarter    Quarter    Quarter   Quarter
     Australia
     Kalgoorlie                         $199       $211       $252      $257
 
     Yilgarn:                            185        215        226       256
       Plutonic                          190        214        230       253
       Darlot                            155        222        194       267
       Lawlers                           211        209        260       251
 
         Subtotal
          Australia                      191        213        238       256
 
     Canada
     Eskay Creek (A) (B)                  51          7        179       137
 
     Hemlo                               211        195        249       233
 
         Subtotal Canada                 129        100        213       184
 
     United States
     Round Mountain                      173        257        232       326
     Ruby Hill                           108        106        247       244
     McLaughlin                          224        224        323       310
     Marigold                            209        196        237       237
     Homestake                           224        275        311       297
         Subtotal
          United States                  183        225        264       294
 
     Chile
     Agua de la Falda                    282        209        344       282
 
     Weighted Average                   $173       $181       $242      $244
 
     (A) For comparison purposes, costs per ounce include estimated third-party
         costs incurredby smelter owners and others to produce marketable gold
         and silver.
     (B)Eskay Creek's costs per ounce are calculated on a by-product basis.
         Included as a credit against costs are the proceeds from the sale of
         3.6 million (3.8 million in 2000) ounces of silver sold in the first
         quarter for $4.62 ($5.09 in 2000) per ounce.If Eskay Creek silver
         production had been accounted for as a co-product, whereby costs were
         allocatedseparately to gold and silver based on their proportion of
         revenues, consolidated total cash costs and total production costs
         would have been $182 and $244 per ounce, respectively, in the 2001
         first quarter and $192 and $249 per ounce, respectively in the 2000
         first quarter.
 
 
                              Homestake Mining Company
                         Production Summary (Metric Units)
 
                                               First Quarter 2001
                                                                   Homestake's
                                                100%                   Share
                                   Tonnes     Average     Ounces      Ounces
                           %      Processed    Grade     Produced    Produced
                       Interest  (thousands) (gm/tonne) (thousands)(thousands)
     Australia
     Kalgoorlie           50        2,849       2.36       196.3        98.2
 
     Yilgarn:                                                          112.6
       Plutonic          100          776       2.67        55.9        55.9
       Darlot            100          174       6.19        31.8        31.8
       Lawlers           100          170       4.78        24.9        24.9
 
         Subtotal
          Australia                                                    210.8
 
     Canada
     Eskay Creek         100           50      54.01        77.1        77.1
 
     Hemlo (A)            50          837       5.66       153.0        73.7
 
         Subtotal Canada                                               150.8
 
     United States
     Round Mountain       50       15,277       0.65       200.7       100.4
     Ruby Hill           100          261       4.35        30.2        30.2
     McLaughlin          100          590       2.19        29.0        29.0
     Marigold             33        1,103       0.86        19.2         6.4
     Homestake           100          194       7.28        47.2        47.2
         Subtotal
          United States                                                213.2
 
     Chile
     Agua de la Falda     51           42       6.03         8.6         4.4
 
     Total Production                                                  579.2
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                         Production Summary (Metric Units)
 
                                               First Quarter 2000
                                                                   Homestake's
                                                100%                   Share
                                   Tonnes     Average     Ounces      Ounces
                           %      Processed    Grade     Produced    Produced
                        Interest (thousands) (gm/tonne) (thousands)(thousands)
     Australia
     Kalgoorlie            50       2,802       2.45       192.1        96.1
 
     Yilgarn:                                                          110.9
       Plutonic           100         774       2.68        58.5        58.5
       Darlot             100         163       5.87        30.4        30.4
       Lawlers            100         150       4.72        22.0        22.0
 
         Subtotal
          Australia                                                    207.0
 
     Canada
     Eskay Creek          100          44      61.54        84.5        84.5
 
     Hemlo (A)             50         731       7.11       170.3        82.3
 
         Subtotal Canada                                               166.8
 
     United States
     Round Mountain        25      14,965       0.51       143.9        36.0
     Ruby Hill            100         250       4.33        28.3        28.3
     McLaughlin           100         661       2.25        29.5        29.5
     Marigold              33         574       1.04        20.3         6.7
     Homestake            100         204       7.30        47.7        47.7
         Subtotal
          United States                                                148.2
 
     Chile
     Agua de la Falda      51          64       7.00        11.9         6.1
 
     Total Production                                                  528.1
 
     (A) Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                    Consolidated Production Costs per Ounce (A)
                            (dollars per ounce of gold)
 
                                                              First Quarter
                                                            2001        2000
 
     Realized Gold Price                                    $271        $292
 
     Per Ounce Costs
     Direct mining costs                                    $183        $190
     Deferred stripping adjustments                           (2)         (2)
     Costs of third-party smelters                            16          18
     By-product credit                                       (29)        (38)
     Other                                                    --           1
     Cash Operating Costs                                    168         169
     Royalties                                                 5          11
     Production taxes                                         --           1
     Total Cash Costs                                        173         181
     Depreciation and amortization                            52          56
     Reclamation and mine closure                             17           7
     Total Production Costs                                 $242        $244
 
     (A) Homestake reports per ounce production costs in accordance with the
         "Gold Institute Cost Standard."
 
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X53362339
 
 

SOURCE Homestake Mining Company
    WALNUT CREEK, Calif., April 26 /PRNewswire/ -- (Note:  All financial
 information is reported in US dollars unless stated otherwise)
     (Photo:  http://www.newscom.com/cgi-bin/prnh/19990326/HMLOGO
              http://www.newscom.com/cgi-bin/prnh/19990329/HMTHOMPSON )
 
     First quarter 2001 summary:
     -- Net loss $12.0 million, compared to net loss of $16.3 million for the
        corresponding 2000 period.  The losses were primarily due to non-cash
        charges related to further weakening of the Australian and Canadian
        dollars against the US dollar.  Net loss per share was $0.05, a
        $0.01 per share improvement over Q1 2000.
     -- Net income before non-recurring items $0.1 million or $0.00 per share
        compared to net loss of $1.9 million or $0.01 per share in Q1 2000,
        despite a $21 per ounce reduction in the average realized price of
        gold.
     -- Cash flow from operations $14.5 million, compared to $38.0 million in
        the first quarter of 2000.
     -- Total attributable gold production 579,200 ounces or 51,100 ounces more
        than in the first quarter of 2000.
     -- Average cash cost $173 per ounce or $8 per ounce lower than in the same
        quarter of 2000.
     -- Year 2001 attributable gold production is forecast at an all-time
        record 2.3 million ounces.  Cash costs are expected to average $163 per
        ounce, a 24-year low.
 
     Homestake Mining Company (NYSE:   HM; Australia: HSM; Toronto: HCX) today
 reported a net loss of $12 million for the first quarter of 2001, compared to
 a net loss of $16.3 million for the corresponding quarter of 2000.  Net loss
 per share in the first quarter of 2001 was $0.05 per share, a $0.01 per share
 improvement over the same period a year earlier.
     The 2001 first quarter net loss was due to after-tax charges of
 $14.5 million composed mainly of the non-cash impact of the weakening
 Australian and Canadian dollars in relation to the US dollar on inter-company
 loans denominated in those currencies.  Net income for the corresponding
 2000 period included similar currency-related charges.
     In the 2001 first quarter, Homestake recorded a gain of $2.4 million
 (primarily related to the sale of relevant data) as a result of subleasing its
 Just-in-Case property in Western Australia to the neighboring Granny Smith
 joint venture.  Homestake received A$5 million upon signing the agreement and,
 subject to government approval, will receive, unless deferred, additional
 payments of A$7.5 million no later than December 31, 2003, and A$12.5 million
 no later than December 31, 2008.  Homestake will also receive a 3.5% net
 smelter return royalty (NSR) on all production from the Just-in-Case sublease
 and an additional payment of up to A$13 million, subject to a maximum
 production limit and creditable against the NSR, if production from the
 Just-in-Case deposit is not completed by June 30, 2010.
     Before allowing for the non-recurring items, Homestake generated after-tax
 net income of $0.1 million or $0.00 per share in the 2001 first quarter,
 compared to a net loss of $1.9 million or $0.01 per share in the same period
 of 2000.
     In the first quarter 2001, Homestake produced 579,200 ounces of gold at an
 average cash cost of $173 per ounce, or 51,100 more ounces of gold at an
 average cash cost of $8 dollars per ounce less than in the same period a year
 earlier.  The higher production and lower cash costs were mostly due to the
 July 2000 acquisition of an additional 25% interest in the Round Mountain
 mine, which produced approximately 40% more gold (100% basis) at cash costs
 33% lower than in the corresponding quarter a year ago.
     "Homestake continues to build upon its strong operating base," said Jack
 Thompson, Homestake's Chairman and Chief Executive Officer.  "We are on track
 to mark our 125th year with record gold production and reduced operating
 costs."
     First quarter 2001 cash flow from operations amounted to $14.5 million,
 compared to $38.0 million in the first quarter of 2000.  The decrease in cash
 flows primarily reflects the $21-per-ounce decline in the average realized
 gold price in the first quarter of 2001 compared to 2000.
     Homestake's balance sheet remains strong, with total cash and short-term
 investments of nearly $193.5 million and net debt of $23.8 million.  Despite
 realizing, on average, $21 per ounce of gold less in the first quarter of 2001
 compared to the same period in 2000, Homestake remains one of the financially
 strongest gold mining companies in the world.
     At the end of the first quarter 2001, Homestake's gold hedge book
 consisted exclusively of forward sales contracts totaling 2.1 million ounces
 or approximately 10% of Homestake's proven and probable reserves.  In the 2001
 first quarter, after scheduled deliveries, Homestake added approximately
 500,000 ounces of Australian dollar-denominated forward sale contracts to lock
 in attractive margins for a portion of its annual gold production in
 Australia.  Homestake's US dollar-denominated gold hedge position remained
 unchanged.
 
                                   Operations
 
     Australia
     During the first quarter of 2001, Homestake's 50%-owned Kalgoorlie
 operation, located in Western Australia, produced 196,300 ounces of gold
 (100% basis) at an average cash cost of $199 per ounce, compared to
 192,100 ounces produced in the same period of 2000 at an average cash cost
 of $211 per ounce.  The improved performance was achieved despite several
 power outages and a full relining of a grinding mill at the sulfide treatment
 plant.  In February 2001, Kalgoorlie successfully commissioned a new ultra
 fine grinding (UFG) unit for processing refractory sulfide concentrates.  The
 new facility finely grinds the concentrates, liberating the gold and making it
 amenable to conventional recovery methods.  The UFG facility, the first of its
 kind in this application, will supplement the existing capacity of the Gidji
 roaster to process the increasing quantities of refractory sulfide
 concentrates produced by the mill.  The UFG unit, commissioned on time and on
 budget, is being successfully phased in to the existing circuit and should be
 fully integrated with the other concentrate treatment facilities in the second
 quarter of 2001.
     Homestake's 100%-owned Yilgarn operations in Western Australia, consisting
 of the Darlot, Plutonic, and Lawlers mines, continued to build upon the strong
 momentum they gained in 2000.  In the first quarter of 2001, these mines
 produced 112,600 ounces of gold at an average cash cost of $185 per ounce.
 During the 2000 first quarter, they produced 110,900 ounces at an average cash
 cost of $215 per ounce.
     Gold production at the Plutonic mine in the first quarter of 2001 amounted
 to 55,900 ounces, 2,600 ounces less than in the 2000 first quarter.  The
 difference is largely attributed to a slightly higher in-process gold
 inventory, as mill throughput, grade and recovery were essentially the same in
 both periods.  Cash costs at Plutonic, however, were further reduced.  With
 additional gains in operating efficiency achieved in the first quarter of
 2001, cash costs averaged $190 per ounce, $24 per ounce less than a year ago.
     At Darlot, the newly-installed owner-operated crushing plant reached
 planned throughput levels in the first quarter of 2001.  The mine's
 underground operations are currently being converted from contract to owner
 mining.  The requisite equipment is in the process of being delivered and
 personnel are being recruited.  In the first quarter 2001, the mine produced
 31,800 ounces of gold, compared to 30,400 ounces in the same quarter of 2000.
 Cash costs during the two periods averaged $155 and $222 per ounce,
 respectively, reflecting greater operating efficiencies and higher grades
 achieved during the first quarter of 2001 compared to 2000.
     In February 2001, the Lawlers mine changed mining contractors.  During the
 first quarter 2001, the operation processed 21,100 more tons than during the
 same quarter of 2000, with additional tonnage primarily sourced from the
 lower-grade stockpiled inventory.  Gold production in the 2001 first quarter
 was 24,900 ounces, approximately 2,900 ounces more than a year ago, and cash
 costs averaged $211 per ounce, about $2 per ounce higher than in the 2000
 first quarter.
 
     Canada
     During the first quarter of 2001, the Eskay Creek mine, located in
 northwestern British Columbia, produced 77,100 ounces of gold at an average
 cash cost of $51 per ounce.  During the same period of 2000, the mine produced
 84,400 ounces at $7 per ounce.  The higher cash costs in the 2001 first
 quarter primarily reflected reduced silver by-product credits related to lower
 silver production and the continued weakness in the price of silver compared
 to the first quarter of 2000.  Higher fuel, transportation and mining costs
 have also contributed to the increased operating costs.  The mine has started
 production from the C-zone where orebodies are smaller than in other active
 areas.  Test mining using modified methods has been initiated to lower these
 costs.
     Homestake's 50%-owned Hemlo operation, located in northwestern Ontario,
 consists of a single mill, which processes ore from the David Bell and
 Williams underground mines and an open pit.  In the first quarter of 2001,
 Hemlo produced 153,000 ounces of gold (100% basis) at an average cash cost of
 $211 per ounce.  In the first quarter of 2000, these operations produced
 170,300 ounces at an average cash cost of $195 per ounce.  The 17,300-ounce
 reduction in gold production and the $16 per ounce increase in cash costs in
 the first quarter of 2001 were due to lower-grade ore mined at both the David
 Bell and Williams mines.  The decrease in grade at the Williams mine was
 mainly due to higher amounts of lower-grade material provided by the open pit
 and production from lower-grade underground stopes at both mines.  The effect
 of processing lower-grade material was partially offset by higher throughput
 at the mill, which in the 2001 first quarter processed, on average, an
 all-time record of 10,250 tons of ore per day.
 
     United States
     In the first quarter of 2001, Homestake's 50%-owned Round Mountain mine,
 located in central Nevada, produced 200,700 ounces of gold (100% basis) at an
 average cash cost of $173 per ounce.  Compared to the first quarter of 2000,
 in the 2001 first quarter, Round Mountain produced, on a 100% basis,
 56,800 ounces more gold at an average cash cost of $84 per ounce less.
 Homestake increased its ownership interest in Round Mountain when it acquired
 an additional 25% interest in this large-scale heap leach and milling
 operation in July of 2000.  The mine commissioned eight new 240-ton trucks to
 replace its older 85 and 150-ton capacity fleet.  In the first quarter of
 2001, the operation moved approximately the same tonnage of material as in the
 first quarter of 2000 (26.4 million tons on a 100% basis).  The grade and
 recovery, however, were much higher due to the increased recovery of gold from
 the dedicated pads and to processing of high-grade oxide stockpiles.
     The wholly-owned Ruby Hill mine, located in central Nevada, remains one of
 Homestake's lowest cost producers.  In the first quarter of 2001, it produced
 30,200 ounces of gold at an average cash cost of $108 per ounce, compared to
 28,300 ounces produced at an average cash cost of $106 per ounce in the same
 period of 2000.  This operation will complete mining in December 2002.
     The Homestake mine, scheduled for closure in December 2001, produced
 47,200 ounces of gold in the first quarter of 2001, virtually unchanged from
 the same period of 2000.  Cash costs, however, were reduced to $224 per ounce
 from $275 per ounce in the 2000 first quarter.  The mine is gradually reducing
 its workforce and site costs in accordance with a planned mine-out schedule.
 
     South America
     The 2000-2001 field season at the 60%-owned Veladero project in
 northwestern Argentina is nearing completion.  The drilling program is
 expected to cease by the end of April.  At that time, the camp will be
 winterized and all field activities terminated until the next season, which is
 expected to commence in October 2001.
     During the second quarter, Homestake will focus on continuing the
 metallurgical testing, incorporating and interpreting new results and updating
 the mine planning, process design, permitting, capital, operating cost and
 financial models.  Homestake plans to complete this stage of work by
 July 2001.
 
                           2001 Operating Projection
 
     Homestake expects 2001 to be an excellent year in terms of increased gold
 production and reduced cash and total costs.  The Company forecasts that in
 2001 it will produce a record 2.3 million ounces of gold at average cash and
 total costs of $163 and $230 per ounce, respectively, the lowest in 24 years
 (Table I).
 
 
     Table I:  Detailed 2001 Forecast
 
                                     Attributable*
                         Gross Gold       Gold
     Operation           Production    Production    Cash Cost**  Total Cost**
     (% Homestake)      (000 ounces)  (000 ounces)  ($ per ounce)($ per ounce)
 
     Kalgoorlie (50%)        828.0         414.0          172          215
 
     Yilgarn (100%):         475.2         475.2          173          219
     Plutonic                241.7         241.7          176          220
     Darlot                  130.5         130.5          165          212
     Lawlers                 103.0         103.0          175          227
     Subtotal Australia                    889.2          172          217
 
     Eskay Creek (100%)      313.7         313.7           40          160
     Hemlo (50%)             650.0         325.0          179          215
     Subtotal Canada                       638.7          111          188
 
     Round Mountain (50%)    626.3         313.2          201          269
     Ruby Hill (100%)        130.3         130.3          113          261
     McLaughlin (100%)       110.7         110.7          239          324
     Marigold (33%)           72.3          24.1          199          229
     Homestake (100%)        186.6         186.6          219          295
     Subtotal United States                764.9          196          281
 
     Agua de la Falda (51%)   43.9          22.4          218          248
     Subtotal South America                 22.4          218          248
 
     Total Homestake                     2,315.2          163          230
 
     * Homestake's share of production
     ** Homestake reports its per ounce costs in accordance with the "Gold
        Institute Production Cost Standard"
 
 
     The above forecast is based on average exchange rates of US$0.65 and
 US$0.53 per Canadian and Australian dollar, respectively.  Homestake's
 calendar 2001 capital budget is estimated at $100 million, which includes
 approximately $20 million for Homestake's share of work at Veladero.
 Approximately 55% of the balance is attributed to the upgrading of the truck
 fleet at Round Mountain, conversion to owner mining at Darlot and expansion of
 milling and concentrate treatment facilities at Kalgoorlie.  As the Company
 completes operations at the Homestake mine and scales down production at some
 of its other higher cost operations, its year 2002 gold output is expected
 to be approximately two million ounces, with cash and total costs averaging
 $160 and $229 per ounce, respectively.
     Homestake Mining Company is an international gold mining company with
 operations and exploration activities in the United States, Canada, Australia
 and Chile.  The Company also has active development and exploration programs
 in Argentina.  Shares of the Company's common stock are listed on the New York
 Stock Exchange, the Australian Stock Exchange and the SWX Swiss Exchange.
 Homestake Canada Inc. exchangeable shares are listed on the Toronto Stock
 Exchange.  Homestake began gold mining operations over 120 years ago, and is
 one of the oldest listed companies on the New York Stock Exchange still in its
 original business.  It has received numerous industry awards for its
 responsible environmental health and safety management programs.  For
 additional corporate information, please visit Homestake Mining Company on the
 Internet at http://www.homestake.com.
     CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT.
 This release contains forward-looking statements that are based on
 management's expectations and assumptions.  They include statements preceded
 by the words "believe," "estimate," "expect,"  "intend," "will," and similar
 expressions; estimates of future production; cost estimates; and other
 estimates of future results or activity.  Such statements are "forward-looking
 statements" that involve risks and uncertainties that could cause actual
 results to differ materially from estimated results.  Among the important
 factors that could cause actual results to differ materially are the
 following.  Production may vary from estimates for particular properties and
 for the Company as a whole because of changes in reserves, variation in ore
 mined from estimated grade and metallurgical characteristics, unexpected
 ground conditions, mining dilution, labor actions, and government
 restrictions. Cash costs may vary due to changes from reserve and production
 estimates, unexpected mining conditions, and changes in estimated costs of
 equipment, supplies, utilities, labor costs and exchange rates.  Capital cost
 estimates are based on operating experience, reserve estimates and expected
 production rates, estimates by and contract terms with third party suppliers,
 expected legal requirements, feasibility reports and other factors.  Factors
 involved in estimated time for completion of projects include the Company's
 experience in completing capital projects, estimates by and contract terms
 with contractors, engineers, suppliers and others involved in design and
 construction of projects, and estimated time for the government to process
 applications, issue permits and take other actions.  Changes in any factor may
 cause costs and time for completion to vary significantly from estimates.
 There is a greater likelihood of variation for properties and facilities not
 yet in production due to lack of actual experience.
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                  Condensed Statements of Consolidated Operations
                      (in thousands, except per share amounts)
 
                                                         Three months ended
                                                              March 31,
                                                          2001         2000
     Revenues
       Gold and ore sales                              $165,456     $165,525
       Interest income                                    3,299        5,089
       Other income                                      (9,037)     (12,421)
         Total Revenues                                 159,718      158,193
 
     Costs and Expenses
       Production costs                                 119,944      108,525
       Depreciation, depletion and amortization          35,160       35,506
       Administrative and general expense                11,381       11,121
       Exploration expense                                6,021       10,049
       Interest expense                                   2,828        4,445
       Other expense                                        312          899
         Total Expenses                                 175,646      170,545
 
     Loss Before Taxes and Minority Interests           (15,928)     (12,352)
     Income Taxes                                         3,309       (2,666)
     Minority Interests                                     625          155
     Loss from Continuing Operations                    (11,994)     (14,863)
     Loss from Discontinued Operations                       --       (1,459)
     Net Loss                                          $(11,994)    $(16,322)
 
     Per Share Amounts - Basic and Diluted
     Loss from Continuing Operations                     $(0.05)      $(0.05)
     Loss from Discontinued Operations                       --        (0.01)
     Net Loss Per Share                                  $(0.05)      $(0.06)
 
     Average Shares Used in the Computation             263,273      260,339
 
 
               Components of Loss Before Taxes and Minority Interests
                              (in thousands - pretax)
 
                                                         Three months ended
                                                              March 31,
                                                          2001         2000
     Income (loss) before significant items,
      taxes and minority interests                      $(2,826)      $3,142
     Significant items:
       Sale of Mining Information                         2,430           --
       Foreign exchange losses                          (15,532)     (14,035)
       Loss from discontinued operations                     --       (1,459)
       Total significant items                          (13,102)     (15,494)
     Loss before taxes and minority interests          $(15,928)    $(12,352)
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                       Condensed Consolidated Balance Sheets
                                   (in thousands)
 
                                                       March 31,    Dec. 31,
                                                          2001        2000
     Assets
       Cash and equivalents                            $187,238     $193,422
       Short-term investments                             6,262        6,237
       Other current assets                             135,063      132,546
       Property, plant and equipment - net              901,132      987,812
       Other noncurrent assets                          107,839       99,358
         Total                                       $1,337,534   $1,419,375
 
     Liabilities and Shareholders' Equity
       Accounts payable and accrued liabilities        $129,054     $143,689
       Current portion of deferred gain on
        close-out of forward sales contracts             11,910       12,869
       Current portion of long-term debt                  2,489        2,822
       Long-term debt                                   214,810      224,616
       Other long-term liabilities                      225,026      212,006
       Deferred gain on close-out of forward
        sales contracts                                  20,060       22,223
       Deferred income taxes                            173,945      181,961
       Minority interests in consolidated
        subsidiaries                                      9,595       10,375
       Shareholders' equity                             550,645      608,814
         Total                                       $1,337,534   $1,419,375
 
 
     FINANCIAL SUMMARY
 
                              HOMESTAKE MINING COMPANY
                  Condensed Statements of Consolidated Cash Flows
                                   (in thousands)
 
                                                          Three months ended
                                                               March 31,
                                                           2001        2000
     Operating Activities
       Loss from continuing operations                 $(11,994)    $(14,863)
       Reconciliation to net cash provided by
        operations:
         Depreciation, depletion and amortization        35,160       35,506
         (Gains) loss on investment sales and
          asset disposals                                (2,864)         263
         Deferred taxes, minority interests and other     2,805       (3,796)
         Effect of changes in operating working
          capital items                                  (9,526)      20,480
     Net cash provided by continuing operations          13,581       37,590
     Net cash provided by discontinued operations           928          408
     Net cash provided by operating activities           14,509       37,998
 
     Investment Activities
       Increase in investments                               --      108,214
       Additions to property, plant and equipment       (24,704)     (16,410)
       Proceeds from sale-leaseback of equipment             --        4,755
       Proceeds from asset sales                          7,923          167
       Increase in long-term assets                      (3,099)          --
       Decrease in restricted cash                           --        1,789
     Net cash provided by (used in) investment
      activities                                        (19,880)      98,515
 
     Financing Activities
       Borrowings                                           821           --
       Debt repayments                                     (624)        (977)
     Net cash provided by (used in) financing
      activities                                            197         (977)
 
     Effect of Exchange Rate Changes on Cash and
      Equivalents                                        (1,010)      (1,745)
 
     Net Increase (Decrease) in Cash and Equivalents    $(6,184)    $133,791
 
 
                              HOMESTAKE MINING COMPANY
                                   Hedge Position
 
                                 Expected Maturity or Transaction Date
                                                              There-  Total or
                        2001    2002     2003    2004   2005   after   Average
 
     US $ denominated
     contracts:
      Forward sales
      contracts:
       Ounces          10,000  10,000      --      --  90,000 559,200   669,200
       Average price
       ($ per oz.)       $400    $403     $--     $--    $400    $418      $415
 
     Australian $
     denominated
     contracts: (A)
      Forward sales
      contracts:
       Ounces         333,000 348,800 258,800 228,800 302,000      -- 1,471,400
       Average price
       (US$ per oz.)     $248    $262    $268    $288    $276     $--      $267
 
     (A) Expressed in US dollars at an exchange rate of A$ = US$ 0.4858
 
 
                              Homestake Mining Company
                                 Production Summary
 
                                               First Quarter 2001
                                                                   Homestake's
                                                 100%                  Share
                                      Tons     Average    Ounces      Ounces
                             %      Processed   Grade    Produced    Produced
                          Interest (thousands) (oz/ton) (thousands)(thousands)
     Australia
     Kalgoorlie              50       3,140      0.069     196.3        98.2
 
     Yilgarn:                                                          112.6
       Plutonic             100         855      0.078      55.9        55.9
       Darlot               100         192      0.181      31.8        31.8
       Lawlers              100         187      0.140      24.9        24.9
 
         Subtotal
          Australia                                                    210.8
 
     Canada
     Eskay Creek            100          55      1.577      77.1        77.1
 
     Hemlo (A)               50         923      0.165     153.0        73.7
 
         Subtotal Canada                                               150.8
 
     United States
     Round Mountain          50      16,839      0.019     200.7       100.4
     Ruby Hill              100         287      0.127      30.2        30.2
     McLaughlin             100         650      0.064      29.0        29.0
     Marigold                33       1,216      0.025      19.2         6.4
     Homestake              100         214      0.212      47.2        47.2
         Subtotal
          United States                                                213.2
 
     Chile
     Agua de la Falda        51          46      0.176       8.6         4.4
 
     Total Production                                                  579.2
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                                 Production Summary
 
                                               First Quarter 2000
                                                                   Homestake's
                                                 100%                  Share
                                      Tons     Average    Ounces      Ounces
                             %      Processed   Grade    Produced    Produced
                          Interest (thousands) (oz/ton) (thousands)(thousands)
     Australia
     Kalgoorlie              50       3,089      0.072     192.1        96.1
 
     Yilgarn:                                                          110.9
       Plutonic             100         853      0.078      58.5        58.5
       Darlot               100         180      0.171      30.4        30.4
       Lawlers              100         165      0.138      22.0        22.0
 
         Subtotal
          Australia                                                    207.0
 
     Canada
     Eskay Creek            100          48      1.797      84.5        84.5
 
     Hemlo (A)               50         806      0.208     170.3        82.3
 
         Subtotal Canada                                               166.8
 
     United States
     Round Mountain          25      16,496      0.015     143.9        36.0
     Ruby Hill              100         276      0.126      28.3        28.3
     McLaughlin             100         729      0.066      29.5        29.5
     Marigold                33         633      0.030      20.3         6.7
     Homestake              100         225      0.213      47.7        47.7
         Subtotal
          United States                                                148.2
 
     Chile
     Agua de la Falda        51          71      0.204      11.9         6.1
 
     Total Production                                                  528.1
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                               Operating Cost Summary
 
                                       Total Cash Costs         Total Costs
                                      (dollars per ounce)  (dollars per ounce)
                                        2001       2000       2001       2000
                                         1st        1st        1st       1st
                                       Quarter    Quarter    Quarter   Quarter
     Australia
     Kalgoorlie                         $199       $211       $252      $257
 
     Yilgarn:                            185        215        226       256
       Plutonic                          190        214        230       253
       Darlot                            155        222        194       267
       Lawlers                           211        209        260       251
 
         Subtotal
          Australia                      191        213        238       256
 
     Canada
     Eskay Creek (A) (B)                  51          7        179       137
 
     Hemlo                               211        195        249       233
 
         Subtotal Canada                 129        100        213       184
 
     United States
     Round Mountain                      173        257        232       326
     Ruby Hill                           108        106        247       244
     McLaughlin                          224        224        323       310
     Marigold                            209        196        237       237
     Homestake                           224        275        311       297
         Subtotal
          United States                  183        225        264       294
 
     Chile
     Agua de la Falda                    282        209        344       282
 
     Weighted Average                   $173       $181       $242      $244
 
     (A) For comparison purposes, costs per ounce include estimated third-party
         costs incurredby smelter owners and others to produce marketable gold
         and silver.
     (B)Eskay Creek's costs per ounce are calculated on a by-product basis.
         Included as a credit against costs are the proceeds from the sale of
         3.6 million (3.8 million in 2000) ounces of silver sold in the first
         quarter for $4.62 ($5.09 in 2000) per ounce.If Eskay Creek silver
         production had been accounted for as a co-product, whereby costs were
         allocatedseparately to gold and silver based on their proportion of
         revenues, consolidated total cash costs and total production costs
         would have been $182 and $244 per ounce, respectively, in the 2001
         first quarter and $192 and $249 per ounce, respectively in the 2000
         first quarter.
 
 
                              Homestake Mining Company
                         Production Summary (Metric Units)
 
                                               First Quarter 2001
                                                                   Homestake's
                                                100%                   Share
                                   Tonnes     Average     Ounces      Ounces
                           %      Processed    Grade     Produced    Produced
                       Interest  (thousands) (gm/tonne) (thousands)(thousands)
     Australia
     Kalgoorlie           50        2,849       2.36       196.3        98.2
 
     Yilgarn:                                                          112.6
       Plutonic          100          776       2.67        55.9        55.9
       Darlot            100          174       6.19        31.8        31.8
       Lawlers           100          170       4.78        24.9        24.9
 
         Subtotal
          Australia                                                    210.8
 
     Canada
     Eskay Creek         100           50      54.01        77.1        77.1
 
     Hemlo (A)            50          837       5.66       153.0        73.7
 
         Subtotal Canada                                               150.8
 
     United States
     Round Mountain       50       15,277       0.65       200.7       100.4
     Ruby Hill           100          261       4.35        30.2        30.2
     McLaughlin          100          590       2.19        29.0        29.0
     Marigold             33        1,103       0.86        19.2         6.4
     Homestake           100          194       7.28        47.2        47.2
         Subtotal
          United States                                                213.2
 
     Chile
     Agua de la Falda     51           42       6.03         8.6         4.4
 
     Total Production                                                  579.2
 
     (A)Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                         Production Summary (Metric Units)
 
                                               First Quarter 2000
                                                                   Homestake's
                                                100%                   Share
                                   Tonnes     Average     Ounces      Ounces
                           %      Processed    Grade     Produced    Produced
                        Interest (thousands) (gm/tonne) (thousands)(thousands)
     Australia
     Kalgoorlie            50       2,802       2.45       192.1        96.1
 
     Yilgarn:                                                          110.9
       Plutonic           100         774       2.68        58.5        58.5
       Darlot             100         163       5.87        30.4        30.4
       Lawlers            100         150       4.72        22.0        22.0
 
         Subtotal
          Australia                                                    207.0
 
     Canada
     Eskay Creek          100          44      61.54        84.5        84.5
 
     Hemlo (A)             50         731       7.11       170.3        82.3
 
         Subtotal Canada                                               166.8
 
     United States
     Round Mountain        25      14,965       0.51       143.9        36.0
     Ruby Hill            100         250       4.33        28.3        28.3
     McLaughlin           100         661       2.25        29.5        29.5
     Marigold              33         574       1.04        20.3         6.7
     Homestake            100         204       7.30        47.7        47.7
         Subtotal
          United States                                                148.2
 
     Chile
     Agua de la Falda      51          64       7.00        11.9         6.1
 
     Total Production                                                  528.1
 
     (A) Homestake's share includes 2,800 ounces produced from the Quarter
         Claim.
 
 
                              Homestake Mining Company
                    Consolidated Production Costs per Ounce (A)
                            (dollars per ounce of gold)
 
                                                              First Quarter
                                                            2001        2000
 
     Realized Gold Price                                    $271        $292
 
     Per Ounce Costs
     Direct mining costs                                    $183        $190
     Deferred stripping adjustments                           (2)         (2)
     Costs of third-party smelters                            16          18
     By-product credit                                       (29)        (38)
     Other                                                    --           1
     Cash Operating Costs                                    168         169
     Royalties                                                 5          11
     Production taxes                                         --           1
     Total Cash Costs                                        173         181
     Depreciation and amortization                            52          56
     Reclamation and mine closure                             17           7
     Total Production Costs                                 $242        $244
 
     (A) Homestake reports per ounce production costs in accordance with the
         "Gold Institute Cost Standard."
 
 
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 SOURCE  Homestake Mining Company