Caledonia Mining 2009 Fourth Quarter and Annual...

FOR:  CALEDONIA MINING CORP

TSX SYMBOL:  CAL
OTC Bulletin Board SYMBOL:  CALVF
AIM SYMBOL:  CMCL

March 31, 2010

Caledonia Mining 2009 Fourth Quarter and Annual Results and Management Conference Call

TORONTO, ONTARIO--(Marketwire - March 31, 2010) - Caledonia Mining Corporation ("Caledonia")
(TSX:CAL)(OTCBB:CALVF)(AIM:CMCL) is pleased to announce its fourth quarter and full year 2009 operating and
financial results. The financial results below are reported in thousands of Canadian dollars.

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Financial Highlights

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(C$ 000's)                                Q4 2009  Q4 2008     2009     2008
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Revenue from sales                          4,263       29   11,559    7,696
Operating costs                             2,522    (156)    8,223    4,438
Gross profit from continuing operations     1,741      185    3,336    3,258
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Income/(loss) after tax before
 discontinued operations                  (3,669)  (2,066)  (3,770)  (4,285)
Net Income/(loss) for the period after
 discontinued operations                  (3,736)  (2,597)  (3,950)  (4,940)
Net loss per share before discontinued
 operations, basic and fully diluted     ($0.007) ($0.005) ($0.008) ($0.009)

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For the year ended December 31, 2009 Caledonia recorded revenues of $11.559 million on the sale of 11,093 ounces
of gold by the Blanket Gold Mine, a gross operating profit of $3.336 million and a net loss of $3.950 million.
This includes a provision of $2.502 million against bonds owing to Blanket which were issued by the Reserve Bank
of Zimbabwe ("RBZ"), a $1.434 million impairment against the "D-type" resource at Caledonia's base metals
exploration project in Zambia and a future tax charge of $0.859 million. The basic net loss per fully diluted
share from continuing operations was $0.008.

Mining operations and gold production recommenced at the Blanket mine in April 2009, having been on care and
maintenance since October 2008 when production was suspended due to the non-payment by the RBZ for gold delivered.
Notwithstanding frequent electricity outages, gold production increased to an annualized rate of approximately
22,000 ounces per annum by July 2009, a level not achieved since February 2007. However, in recent months gold
production at Blanket has been adversely affected by the increased frequency and duration of power outages,
currently running at approximately 25% per month on average. In addition, operational difficulties continue from
the historic delay in completing the No. 4 Shaft Expansion Project due to a lack of capital occasioned by RBZ's
non-payment for gold delivered.

For the year ended December 31, 2009, Caledonia realized an average price for gold sold of US$962 per ounce, and
US$1,108 per ounce for gold sold in the quarter ended 31 December, 2009. Operating costs per ounce of gold
produced were US$562 for the period from the re-commencement of gold production in April 2009 to December 31, 2009
and US$596 in the quarter ended December 31, 2009.

Blanket's immediate focus is the completion of the No. 4 Shaft Expansion Program, scheduled for completion by the
fourth quarter of 2010 and which will enable gold production to be increased progressively to an annualized rate
of approximately 40,000 ounces of gold.

The Government of Zimbabwe recently introduced measures which give effect to the legislated requirement for 51% of
all businesses in Zimbabwe to be owned by indigenous Zimbabweans within five years. Caledonia, as a member of the
Chamber of Mines Zimbabwe ("COMZ"), continues to work closely with the COMZ regarding the ongoing discussions with
the Government regarding the level and terms of indigenization for the mining industry.

The 2009 exploration programme at Nama in Zambia focussed on evaluating all of the known cobalt/copper anomalies
and prioritizing targets for future exploration. This work has identified several new exploration targets which
will be addressed when funds become available.

Commenting on the year's performance, Stefan Hayden, President and CEO, said "The rapid resumption of gold
production at Blanket and re-starting the No. 4 Shaft Expansion Project have been challenging. Compared to
previous years the operating environment in Zimbabwe has stabilized and we expect that Blanket can continue to
export its gold and retain 100% of the proceeds in US dollars. However numerous challenges remain, in particular
clarification of the indigenization legislation, securing a stable electricity supply, maintaining control over
operating and capital costs and maintaining sufficient working capital. However, indications are at this stage
that Blanket will achieve its targeted annualized production level of 40,000 ounces before year end. Thereafter
Blanket will be well-positioned to grow further through its development projects. We remain hopeful that the
government of Zimbabwe will adopt a pragmatic economic approach to the issue of indigenization which recognizes
the investment of companies like Blanket in Zimbabwe's infrastructure and human capital, and which facilitates
investment to create new jobs and wealth for all Zimbabweans."

A full set of the Annual Financial Statements, annual MD&A and the 2009 Annual Information Form can be found on
www.sedar.com and our website www.caledoniamining.com.

Caledonia management will host a conference call starting at 11.00 hours (EDT) on April 12, 2010. Please dial-in
10 minutes beforehand and quote the conference ID number: 752198#. A recording of the conference call will be
available on the website, www.caledoniamining.com from April 13, 2010.

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Canadian Toll-free Number(i): 1866 423 2066
USA Toll-free Number(i): 866 793 4273
UK Toll-free Number(i): 0800 238 7320

International Access Number: [phone]
Canadian Toll Number: [phone]
USA Toll Number: [phone]

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(i)If you are calling from a mobile phone your provider may charge you when connected to the toll-free numbers.

For more information, please visit www.caledoniamining.com.

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FOR FURTHER INFORMATION PLEASE CONTACT:

Caledonia Mining Corporation
Mark Learmonth
[phone]

OR

BuckBias
Alex Buck
[phone]

OR

RBC Capital Markets
Martin Eales
[phone]

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Caledonia Mining Corp