Mr. Darren Pylot reports

CAPSTONE MINING REPORTS 2012 YEAR END FINANCIAL RESULTS

Capstone Mining Corp. has released its financial results for the year ended Dec. 31, 2012. All amounts are in U.S. dollars unless otherwise specified. Net earnings for the year were $59.6-million, and operating cash flow before changes in working capital was $114.4-million. Net earnings for the fourth quarter were $18.5-million, and operating cash flow before changes in working capital was $24.7-million. Capstone ended the year with cash on hand of $499.9-million, a $200-million credit facility and no long-term debt. Copper production for the year at Capstone's two operating mines, Cozamin and Minto, totalled 82.8 million pounds in concentrates (79.6 million pounds of payable copper) at a total cash cost of $1.50 per payable pound of copper produced.

Capstone will hold a conference call and webcast on Thursday, March 14, 2013, at 11:30 a.m. (Eastern Time) (8:30 a.m. (Pacific Time)) to discuss these results. The call-in details are provided at the end of this release. This release should be read in conjunction with Capstone's consolidated financial statements and management's discussion and analysis for the year ended Dec. 31, 2012, which are available on Capstone's website and on SEDAR. An updated corporate presentation, including results to Dec. 31, 2012, will also be available on the company's website.

                                     OVERVIEW
      (dollar amounts in millions, except per-share amounts and where noted)

                                               Three months ended        Year ended
                                                         Dec. 31,          Dec. 31,
                                                    2012     2011     2012     2011

Revenue                                          $  72.5  $  61.5  $ 305.5  $ 327.8
Copper in concentrates produced (million lbs)       19.7     19.8     82.8     78.3
Payable copper produced (million lbs)               18.8     19.0     79.6     75.5
Total cash cost per payable pound of copper 
produced ($)                                        1.70     1.50     1.50     1.45
Copper sold (million lbs)                           19.4     16.5     79.0     79.1
Recognized copper price per pound ($)               3.47     3.40     3.66     3.90
Net earnings                                     $  18.5  $   4.9  $  59.6  $  60.4
Net earnings per common share ($)                   0.05     0.01     0.16     0.20
Adjusted net earnings                            $  19.3  $   4.2  $  77.9  $  52.2
Adjusted net earnings per common share ($)          0.05     0.01     0.20     0.18
Operating cash flow before changes in working 
capital                                          $  24.7  $  15.0  $ 114.4  $ 120.2
Operating cash flow before changes in working 
capital per common share ($)                        0.06     0.04     0.30     0.41
Cash and cash equivalents                                          $ 499.9  $ 486.3

"We had another solid year in 2012," said Darren Pylot, president and chief executive officer of Capstone. "Our revenue, earnings and cash flow remained strong, and we exceeded production and cost guidance for the year. Both operating mines are well positioned to deliver on their targets in 2013.

"We are looking ahead to the growth of the company, and in 2013 are reinvesting in our mines and development projects. With approximately 10-year mine lives at our operating mines and additional exploration upside, Capstone is poised to deliver strong results well into the future. We plan to advance our development projects in 2013 by formally entering the permitting process at Kutcho and completing key milestones at Santo Domingo, including submitting the environmental impact study and completing the feasibility study. We will also continue activities on our greenfield exploration portfolio with initial drilling campaigns at projects in Chile and Mexico," continued Mr. Pylot.

"With our strong balance sheet we have the financial resources in place to execute on our strategy. In addition, the ability to deploy our balance sheet on opportunistic acquisitions provides Capstone with the flexibility to grow our short-term production profile and advance the company to the next level."

Financial and production highlights for the year ended Dec. 31, 2012, included:

• Net earnings of $59.6-million, or 16 cents per common share, which included:
  • Earnings from mining operations of $113-million from a recognized copper price of $3.66 per pound;
  • $29.2-million in current and deferred tax expenses;
  • Cost of sales included a $5.5-million non-cash charge related to the writedown of ore stockpile inventory at the Minto mine.
• Adjusted net earnings of $77.9-million, or 20 cents per common share, after making adjustments for certain non-cash and non-recurring items;
• $114.4-million, or 30 cents per common share, of operating cash flow before changes in working capital;
• Working capital increased to $562.1-million at Dec. 31, 2012 (which included $499.9-million of cash and cash equivalents) from $539.8-million at Dec. 31, 2011;
• Produced a total of 79.6 million pounds of payable copper at an estimated total cash cost of $1.50 per pound of payable copper produced;
• Recorded revenue of $305.5-million on the sale of 79 million pounds of copper, 13.2 million pounds of zinc, 2.6 million pounds of lead, 18,562 ounces of gold and 1,628,008 ounces of silver.

Financial and production highlights for the three months ended Dec. 31, 2012, included:

• Net earnings of $18.5-million, which included:
  • Earnings from mining operations of $29.4-million, which was partially offset by general and administrative expenses of $4.3-million, share-based compensation of $1-million, a gain on foreign exchange of $1.5-million, and current and deferred income taxes of $7.2-million;
  • Earnings from mining operations were driven by revenue of $72.5-million on the sale of 19.4 million pounds of copper, 3.9 million pounds of zinc, 400,000 pounds of lead, 5,700 ounces of gold and 452,000 ounces of silver.
• Produced a total of 18.8 million pounds of payable copper at an estimated total cash cost of $1.70 per pound of payable copper produced;
• Adjusted net earnings of $19.3-million, or five cents per common share, after making adjustments for certain non-cash and non-recurring items;
• Operating cash flow before changes in working capital of $24.7-million or six cents per share.

Operational highlights for the year ended Dec. 31, 2012

At the Cozamin mine in Mexico the company:

• Achieved record mill throughput in 2012, averaging 3,205 tonnes per day;
• Produced a record 46.9 million pounds of copper in concentrates during the year;
• Completed 27,114 metres of underground exploration drilling in 48 diamond drill holes;
• Completed 4,754 metres of surface exploration drilling in five diamond drill holes;
• Incorporated a copper reserve in the MNFWZ (Mala Noche footwall zone) of 2.27 million tonnes at a grade of 1.96 per cent copper, based on the initial resource estimate, bringing the remaining mine life at Cozamin to nine years;
• Completed 1,138 metres of development drifting on the MNFWZ, mining 107,356 tonnes of development ore at an average grade of 1.9 per cent copper for the year;
• In two separate resource updates announced in February, 2012, and March, 2013, the measured and indicated resource in MNFWZ increased to 188.6 million pounds of contained copper, which includes the MNFWZ reserves.

At the Minto mine in Yukon the company:

• Achieved record mill throughput in 2012, averaging 3,665 tonnes per day;
• Produced 35.9 million pounds of copper in concentrates, lower than in 2011 due to lower grades compared with the previous year as a result of a higher proportion of stockpile material feeding the mill;
• Commenced underground development with the initial excavation of the portal and began development of the decline by a contractor; initial ore release from the underground is planned for the third quarter of 2013;
• In October, 2012, the amendment to Minto's water use licence was approved, allowing the placement of area 2/118 tailings into the mined-out main pit; all necessary permits are in place to mine all identified reserves in the area 2/118 open pit and underground mines;
• Completed 29,539 metres of exploration drilling in 84 diamond drill holes;
• Added 67 million pounds of copper resources in the measured and indicated category, and 11 million pounds in the inferred category after an update of the Minto South deposit block model;
• Added an additional 101 million pounds of copper resources in the measured and indicated category, and 86 million pounds in the inferred category from the Fireweed extension of Minto East and Inferno North extension of Minto North;
• Completed the phase 6 preliminary feasibility study, which includes additional underground mineral reserves from the Copper Keel and Wildfire zones in the Minto mine plan. The study extends the mine life to 2022 with yearly average copper production of 40 million pounds at an average cash cost of $1.92 per pound of payable copper.

Santo Domingo project, Chile:

• Capstone awarded the contract for the preparation of the Santo Domingo project environmental impact study to Knight Piesold.
• Capstone awarded the feasibility study and basic engineering to AMEC, with NCL Ingenieria y Construccion Ltda. providing the mining section of the study.
• Capstone selected a port location and completed preliminary engineering studies for this greenfield port site located 110 kilometres from the Santo Domingo project. The port site was chosen because of its exceptionally high availability for loading iron vessels. Formal application for the marine concession was made in March, 2013.
• In connection with preparation of the feasibility study, AMEC, NCL and Capstone personnel have completed a preliminary estimate of the development capital to build the Santo Domingo project. The capital cost is currently estimated at $1.5-billion to $1.8-billion, dependent on flow sheet variables and mine equipment lease/purchase options. Capstone is continuing on schedule to complete the study by year-end.
• Subsequent to year-end, an additional 1,470 metres of condemnation drilling was completed in support of the feasibility study to sterilize a new tailings deposition area, which was identified as a superior location during the optimization process.

Kutcho project, British Columbia:

• Basic engineering continued to support the compilation of the environmental application, and revision of capital and operating expenditure estimates.
• A Section 13 order has been issued by the British Columbia Environmental Assessment Office based on the revised project description, and the application information requirements were approved for the environmental assessment application.
• Consultation with first nations, moving toward impact benefit agreements, continued throughout 2012.
• The project remains on track to submit an environmental assessment application in mid-2013.

Production outlook

Capstone's 2013 guidance of 85 million pounds (plus or minus 5 per cent) of copper contained in concentrates at a total cash cost of $1.65 to $1.75 per pound of payable copper, net of byproduct credits and selling costs, remains unchanged.

Adoption of advance notice policy

Capstone also announces the approval by its board of directors of an advance notice policy. The purpose of the policy is to provide shareholders, directors and management of the company with a clear framework for nominating directors.

Among other things, the policy includes a provision that requires advance notice to be given to Capstone in circumstances where nominations of persons for election to the board are made by shareholders other than pursuant to a requisition of a meeting made pursuant to the provisions of the British Columbia Business Corporations Act or a shareholder proposal made pursuant to the provisions of the act. The policy fixes a deadline by which director nominations must be submitted to Capstone prior to any annual or special meeting of shareholders and sets forth the information that must be included in the notice to the company in order for a nominee to be eligible for election.

In the case of an annual meeting, notice to Capstone must be given no fewer than 35 nor more than 60 days prior to the date of the meeting, provided that if the meeting is to be held on a date that is fewer than 50 days after the date on which the first public announcement of the date of the meeting was made, notice may be given no later than the close of business on the 10th day following such public announcement.

In the case of a special general meeting that is not also an annual meeting, notice to the company must be made no later than the close of business on the 15th day following the day on which the first public announcement of the date of the special meeting was made.

The policy is effective and in full force and effect as of the date it was approved. In accordance with the terms of the policy, the policy will be put to shareholders of Capstone for approval at the next annual general meeting to be held on May 8, 2013. If the policy is not confirmed at the meeting by ordinary resolution of shareholders, the policy will terminate and be of no further force and effect following the termination of the AGM.

Conference call and webcast details

Capstone will host a conference call and webcast on Thursday, March 14, 2013, at 11:30 a.m. (Eastern Time) (8:30 a.m. (Pacific Time)).

Date:  Thursday, March 14, 2013

Time:  11:30 a.m. (Eastern Time), 8:30 a.m. (Pacific Time)

Dial-in numbers:  1-888-390-0605 (North America toll-free), 1-416-764-8609 (international)

Webcast:  On-line

Call replay:  1-888-390-0541 (North America toll-free), 1-416-764-8677 (international)

Replay passcode:  017456

The conference call replay will be available until March 28, 2013. The conference call audio and transcript will be available on Capstone's website within approximately 24 hours of the call.

The disclosure of the technical information contained in this news release has been reviewed and approved by John Wright, PEng, business development manager (technical information related to mining and production), and Brad Mercer, PGeol, vice-president, exploration (technical information related to mineral exploration activities), both qualified persons under NI 43-101. In addition, Gregg Bush, senior vice-president and chief operating officer, reviewed all technical information in this news release.

We seek Safe Harbor.