Manila Mining Corporation

December 24, 1999 PSE CIRCULAR FOR BROKERS NO. 3280-99 SUBJECT : Manila Mining Corporation Attached is the Amended Annex "D" (Management's Discussion and Analysis of Financial Condition and Results of Operations) as an amendment to the Quarterly Report (SEC Form 11-Q) of Manila Mining Corporation for the quarter ended September 30, 1999. For your information. (SGD.) MARIA ISABEL T. GARCIA OIC Listings and Disclosure Group MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Production figures for the nine months ended September 30, 1999 show substantial improvements from 1998 levels. Total gold production (actual bullion production and gold equivalent of copper concentrates produced) reached 55,682.05 oz, compared with 50,802.496 oz. in 1998. Due however to the depressed price of gold and the stronger peso vis-a-vis the US$, the Company incurred a net loss of P29.8 million, compared with P127.5 million in 1998. On the average,. gold was priced at $271.53/oz. versus $295.24/oz. a year ago, while forex averaged P38.62 versus P40.76 to US$1 the previous year. This underlying weakness caused the gross revenue to drop by 9% from P581 million in 1998 to P527 million this year. Costs and expenses, however, decreased by 22%, P556 million as against P710 million last year, due to stringent measures to bring down the cost of production. llcd Bullion production for the third quarter of 1999 amounted to 5,177.16 oz, 23 % lower than the same period in 1998. Gold content of copper concentrate however almost quadrupled from 3,451.36 oz. to 13,411.40 oz. Total gold production for the third quarter was 22,780.67 oz. compared with 15,840,21 oz. the previous year. Financial results for the third quarter reflect the improvement in production: gross income rose 30 % to P195 million as expenses dropped by 10% to P202 million. Consequently, net loss dropped to P7 million from P73 million in 1998. Total assets increased by 5.5% to P2.557 billion as of end September 1999 from P2.422 billion as of December 31, 1998 due to increase in current assets, particularly prepayments, as a result of acquisition of machinery and equipment. On the liability side, accounts payable and accruals grew by 33% to total P696 million. LibLex The Company is installing a regrind ball mill at a cost of approximately P24 million that should increase metal recoveries from the copper flotation by at least 7.5%. This would result in additional revenues of over P50 million annually for the Company. The new project will be operational by the first quarter of year 2000.