Interim Results

Caledonia Mining Corporation
12 August 2005



                          Caledonia Mining Corporation

                          Second Quarter Results 2005

Toronto, Ontario - August 12, 2005: Caledonia Mining Corporation ('Caledonia')
(TSX: CAL, NASDAQ-OTCBB: CALVF, AIM: CMCL) is pleased to announce its key
financial and operating results for the second quarter ended June 30, 2005. The
financial results are reported in Canadian dollars except where otherwise
stated.

Operational Highlights

Barbrook Gold Mine

-           Gold production increased by 85% to 1,712 ounces of gold, (Q1: 925
            ozs) following continued metallurgical plant improvements.

-           Doubling the treatment capacity of the metallurgical plant to 15,000
            tonnes per month is currently being designed. Construction is 
            scheduled to start prior to September 30 and expected to take 3 to 4 
            months.

-           Decision on the construction of a Biox(R) plant deferred until this
            plant expansion is completed and has been assessed.

-           Economic gold grades have been intersected in the Taylors ore body
            between 10 and 7 levels in an area previously considered to be 
            barren of gold mineralization.

-           Senior management changes including the appointment of Patrick Smith
            as the Mine Manager.

Exploration

-           Drilling commenced on the Grasvally platinum property in May and
            3,192 meters drilled during the quarter.

-           The planned drilling programs on the Rooipoort platinum property
            have been completed with 1,227 meters drilled during the quarter.

-           Reconnaissance mapping commenced at the Eersteling Gold Project in
            June to follow-up results from the recent geophysical survey.

-           Testing by Mintek of the Nama 'A' anomaly ore largely completed.
            Test work to further optimize the overall cobalt recoveries and 
            concentrate grades will be completed during the third quarter.

-           Approval obtained from the Environmental Council of Zambia for an
            amendment to the existing Environmental Brief to allow pilot plant 
            operations at the Nama Cobalt Project.


Corporate

-           In June Caledonia listed on the London Stock Exchange's AIM Market,
            ticker symbol 'CMCL', and placed a small float of shares into the 
            AIM market in conjunction with a financing.

-           The financing on AIM raised £1.57 million (Cdn$3.54 million) before 
            expenses.

-           A Letter of Intent was signed with a cobalt refinery for the 
            long-term supply of cobalt concentrate from the Nama Project, on 
            condition that the testwork and commercial process is satisfactory.

For the quarter ended June 30, 2005 Caledonia recorded an operating loss of $1.4
million ($0.005 per share) compared with an operating loss of $1.4 million
($0.005 per share) in the same quarter of 2004.

The net loss after all expenses, a change in the application of the accounting
policy regarding amortization, ongoing exploration and assay costs, Nama test
work costs, and exchange losses was $3.3 million ($0.011 per share) for the
quarter ended June 30, 2005. Previously reported results, which excluded
amortization, were a net loss of $1.4 million ($0.005 per share) during the same
period in 2004.

Reviewing the quarter, Stefan Hayden, President and CEO, said, 'I'm pleased to
report the performance trend at Barbrook has continued, with gold production up
by 85% to 1,712 ounces, despite the mining of a lower grade section. This was
necessary due to the geometry of the ore zone and the mining sequence, and the
mining of a higher grade area will recommence in August. The doubling of the
metallurgical plant capacity to treat 15,000 tonnes per month is currently being
designed. The recent completed access of a mineralized zone that was previously
considered to be barren should enable Barbrook to effectively double monthly
gold production sooner than originally planned. Construction of the plant
expansion will start late in the third quarter and is expected to take 3 to 4
months. The cost estimate of the plant expansion will be released once the
design has been finalized.

At Grasvally, immediately upon receiving the New Order Prospecting Right we
mobilized drill rigs to commence a drilling program. To date, 3,192 meters have
been drilled and we anticipate reporting drill results to shareholders during
the third quarter.

At Nama, the testing of 'A' anomaly ore sample was largely completed with Mintek
carrying out additional work to optimize the overall cobalt recoveries and
concentrate grades. We have also taken the first step towards developing the
project with the signing of a Letter of Intent with a large cobalt refinery. The
discussions with the refinery are ongoing regarding the next phase of their
metallurgical testwork, which is expected to be completed during the third
quarter. Provided that a commercial process is satisfactory, the details of the
long-term offtake agreement will then be finalised and a pilot plant will be
built as soon as practical at Nama with technical assistance from the refinery.
In anticipation of this, Caledonia has received approval from the Environmental
Council of Zambia for an amendment to the existing Environmental Brief to allow
for mining operations to feed the pilot plant. Discussions with a growing number
of large end-users continue.

Turning to our exploration projects, a number of programs commenced during the
quarter at Grasvally, Kirkerk, Nama and Eersteling, which will be completed
during the third quarter, the results of which will be reported to shareholders
before the year-end.

In short, I believe Caledonia has made a good start in the first half of 2005 as
we have already achieved a number of our stated 2005 objectives. The second half
of the year is expected to be exciting and rewarding for Caledonia. I anticipate
a further increase in gold production from Barbrook which should be favourably
impacted by the plant expansion. Ongoing development of the Nama Cobalt Project,
the Rooipoort Platinum Project, and the Mulonga Plains Diamonds Joint Venture
drilling which will commence during the third quarter, should contribute to
Caledonia's further growth and success'.

Caledonia Management's Discussion and Analysis was published on August 12, 2005
and is available on the company's website: www.caledoniamining.com.

For more information, please contact:
Stefan Hayden                                     Alex Buck / Nick Bias
President and CEO, Caledonia Mining               buck-bias
Tel: [phone]                              Tel: [phone]

Further information regarding Caledonia's operations, exploration activities,
press releases and financials may be found at www.caledoniamining.com.

Certain statements included herein are 'forward-looking statements'. Management
cautions that forward- looking statements are not guarantees, and that actual
results could differ materially from those expressed or implied in the
forward-looking statements. Important factors that could cause the actual
results of operations, exploration or development programmes, or the financial
condition of the Corporation, to differ include, but are not necessarily limited
to, the risks and uncertainties discussed in documents filed by the Corporation
with the various regulatory authorities having jurisdiction.


Caledonia Mining Corporation
Consolidated Balance Sheets
(in thousands of Canadian dollars)
                                        June 30,       June 30,   December 31,
(Unaudited)                                 2005           2004           2004

Assets
Current
Cash and short term deposits               2,482         12,644          6,470
Accounts receivable                          599            325            316
Inventories                                  839             29            508
Prepaid expenses                               3              4            187
                                    ____________   ____________   ____________
                                           3,923         13,002          7,481

Investment at cost                            79             79             79
Capital assets                             7,141          9,411          7,158
Mineral properties                        10,859          7,891          8,948
                                    ____________   ____________   ____________
                                          22,002         30,383         23,666
                                    ____________   ____________   ____________

Liabilities and Shareholders'
Equity
Current
Accounts payable                           1,252            597          1,062

Provision for site restoration               397            904            423
                                    ____________   ____________   ____________
                                           1,649          1,501          1,485
                                    ____________   ____________   ____________

Shareholders' Equity
Share capital                            176,470        173,318        173,304
Contributed surplus                          548            437            480
Compensation warrants                        321            307            321
Deficit                                 (156,986)      (145,180)      (151,924)
                                     ____________   ____________   ___________
                                          20,353         28,882         22,181
                                      ____________   ____________   ___________
                                          22,002         30,383         23,666



Caledonia Mining Corporation
Consolidated Statements of Deficit
(in thousands of Canadian dollars)

               Three month period ended June 30,           Six month period ended June 30,
(Unaudited)         2005         2004       2003              2005       2004         2003
Deficit,
beginning       (153,710)    (143,670)  (127,657)         (151,924)  (141,945)    (127,449)
Net (loss)
for the period    (3,276)      (1,435)    (1,406)           (5,062)    (3,160)      (1,614)

               __________   __________   ________         _________   ________   __________
Deficit, end
of period       (156,986)    (145,105)  (129,063)         (156,986)  (145,105)    (129,063)




Consolidated Statements of Operations
(in thousands of Canadian dollars except per share amounts)

               Three month period ended June 30,     Six month period ended June 30,
 (Unaudited)       2005       2004      2003         2005       2004       2003
Revenue and
operating
costs

Revenue from
sales               965         30         -        1,446        170         53
Operating
costs             2,393      1,396     1,232        4,141      2,711      1,304
               ________   ________   _______     ________   ________   ________
Operating
profit (loss)    (1,428)    (1,366)   (1,232)      (2,695)    (2,541)    (1,251)
               ________   ________   _______     ________   ________   ________

Costs and
expenses

General and
administrative      728        660       258        1,224        959        628
Interest              5         88        44            5        135         64
Other expense
(income)          1,115       (679)     (128)       1,138       (462)      (329)
               ________   ________   _______     ________   ________   ________
                  1,848         69       174        2,367        632        363
               ________   ________   _______     ________   ________   ________

(Loss) before
non-controllin
g interest       (3,276)    (1,435)   (1,406)      (5,062)    (3,173)    (1,614)
Non-controlling
interest              -          -         -            -        (13)         -
               ________   ________   _______     ________   ________   ________
Net (loss) for
the period       (3,276)    (1,435)   (1,406)      (5,062)    (3,160)    (1,614)

Operating
(loss) per
share (Note 2)

Basic and
fully diluted  ($0.005)   ($0.005)   ($0.006)    ($0.009)   ($0.009)   ($0.006)

Net (loss) per
share (Note 2)

Basic and
fully diluted  ($0.011)   ($0.005)   ($0.006)    ($0.017)   ($0.011)   ($0.007)




Caledonia Mining Corporation
Consolidated Statements of Cash Flows
(in thousands of Canadian dollars)

                  Three month period ended June 30,  Six month period ended June 30,
(Unaudited)         2005      2004       2003         2005      2004      2003
Cash provided by
(used in)

Operating
activities

Operating
(loss) for the
period            (1,428)   (1,366)    (1,232)      (2,695)   (2,541)   (1,251)

Other costs
and expenses
and
non-controlling 
interests         (1,848)      (69)      (174)      (2,367)     (619)     (363)

Adjustments to
reconcile net
cash from operations 326      (682)         0          518      (592)       18
 

Changes in
non-cash
working
capital Balances      (99)     (169)       (67)        (242)     (157)     (336)

                   ______   _______   ________     ________   _______   _______
                   (3,049)   (2,286)    (1,473)      (4,786)   (3,909)   (1,932)
                   ______   _______   ________     ________   _______   _______

Investing
activities

Expenditures
on capital
assets               (69)     (927)       (10)        (256)   (1,114)     (194)
Expenditures
on mineral
properties          (956)     (496)       (45)      (2,112)     (679)   (1,081)
                   ______   _______   _______      _______    _______   ______
                  (1,025)   (1,423)       (55)      (2,368)   (1,793)   (1,275)
                   ______   _______   _______      _______    _______   ______

Financing
activities
Loan payable                    -         (5)                     -       (44)
Issue of share
capital net of
issue costs        3,166     4,885          9        3,166    14,167     2,520
                    ______   ______    ______       _______    ______    ______
                   3,166     4,885          4        3,166    14,167     2,476
                    ______   ______    ______       _______    ______    ______

Increase
(decrease) in
cash for the
period              (908)    1,176     (1,524)       3,988     8,465      (731)
Cash and cash
equivalents,
beginning of
period              3,390    11,468      2,657        6,470     4,179     1,864
                   ______   _______   _______      _______    ______    _______
Cash and cash  
equivalents,
end of period       2,482    12,644      1,133        2,482    12,644     1,133
                   ______   _______   _______      _______    ______    _______




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