New Gold Achieves Strong Operational and Financial Performance in Second Quarter 2012 and Announces Commercial Production at New Afton

Transcription

1 New Gld Achieves Strng Operatinal and Financial Perfrmance in Secnd Quarter 2012 and Annunces Cmmercial Prductin at New Aftn (All figures are in US dllars unless therwise indicated) August 1, 2012 New Gld Inc. ( New Gld ) (TSX and NYSE MKT:NGD) tday annunces financial and peratinal results fr the secnd quarter f 2012, with gld prductin f 95,158 unces at a ttal cash cst (1) per unce sld, net f by-prduct sales, f $472 per unce. The cmpany s slid gld prductin, belw average csts and the cntinued strength f gld prices, led New Gld t anther quarter f slid financial results, including an average realized margin f ver $1,000 per unce. During the quarter, earnings frm mine peratins were $76 millin, net earnings were $24 millin, r $0.05 per share, and adjusted net earnings were $46 millin, r $0.10 per share. In key milestnes, New Gld delivered n the targeted June prductin start at its New Aftn mine and tday annunces that the mine has reached cmmercial prductin. The cmpany als received a ruling frm the Ontari Superir Curt f Justice in late June cnfirming the cmpany s partnership with Gldcrp Inc. ( Gldcrp ) at the El Mrr prject. Our cmpany cntinued t build mmentum in the secnd quarter, realizing strng peratinal and financial results and delivering n key bjectives at ur develpment prjects that psitin us well fr the future, stated Randall Oliphant, Executive Chairman. Secnd Quarter 2012 Highlights New Aftn prductin started n June 28 th with prcessing f re frm undergrund and surface stckpile and achieved cmmercial prductin n July 31 st, ahead f schedule Average daily milling rate in mnth f July f 7,428 tnnes per day, r 68% f 11,000 tnne per day nameplate capacity Gld prductin increased by 8% t 95,158 unces frm 88,478 unces in the same perid f the prir year Ttal cash cst (1) per unce sld, net f by-prduct sales, f $472 per unce, well belw industry average Earnings frm mine peratins f $76 millin Adjusted net earnings f $46 millin, r $0.10 per share Ontari Superir Curt f Justice s publicly released decisin n June 27, 2012 affirmed New Gld s partnership at El Mrr Blackwater updated Natinal Instrument cmpliant mineral resurce estimate subsequent t end f quarter, which includes: Indicated gld resurce: 230 millin tnnes at an average grade f 0.96 grams per tnne cntaining 7.1 millin unces f gld at a 0.40 gld-equivalent gram per tnne cut-ff grade Inferred gld resurce: 98 millin tnnes at an average grade f 0.77 grams per tnne cntaining 2.5 millin unces f gld at a 0.40 gld-equivalent gram per tnne cut-ff grade Clsed a $300 millin 7.0% senir ntes ffering n April 5 th

2 I believe we may ultimately lk back at the secnd quarter f 2012 as ne f the mst imprtant in the cmpany s histry, added Mr. Oliphant. We started New Aftn n time, we wn the El Mrr lawsuit, we increased ur financial flexibility and we fund mre gld at Blackwater. We are very prud f these achievements as well as ur cntinued track recrd f delivering peratinally. Gld Prductin and Sales Operatins Overview New Gld 2012 Secnd Quarter Cnslidated - Summary Operatinal Results Three mnths ended Six mnths ended June 30, June 30, Gld Prductin (thusand unces) Mesquite Cerr San Pedr Peak Mines Ttal Gld Prductin Ttal Gld Sales Average realized gld price ($ per unce) $1,486 $1,417 $1,530 $1,365 Silver Prductin (thusand unces) Cerr San Pedr , ,155.7 Ttal Silver Sales , ,188.1 Average realized silver price ($ per unce) $28.68 $38.85 $30.42 $35.78 Cpper Prductin (millin punds) Peak Mines Ttal Cpper Sales Average realized cpper price ($ per pund) $3.24 $4.05 $3.48 $4.12 Ttal Cash Cst (1) - net f by-prduct sales ($ per unce) Mesquite $657 $654 $641 $588 Cerr San Pedr $168 $26 $199 $18 Peak Mines $645 $585 $759 $488 Ttal Cash Cst (1) - net f by-prduct sales $472 $354 $507 $353 Average realized margin ($ per unce) $1,014 $1,063 $1,023 $1,012 Cnslidated gld prductin during the secnd quarter increased by 8% ver the same perid f the prir year. The increase was primarily driven by a 47% increase in gld prductin at the Peak Mines, while an increase in prductin at Mesquite was ffset by a slight decrease at Cerr San Pedr. Mesquite 7% higher prductin as an increase in re tnnes placed n the leach pad was nly partially ffset by mining f lwer grades due t mine sequencing Cerr San Pedr Minr decrease in prductin as mining f higher grades, due t mining clser t reserve grade, was mre than ffset by fewer re tnnes being placed n the leach pad due t planned waste mining Peak Mines Increase in prductin frm a cmbinatin f higher grades, due t mining f areas clser t reserve grade, and cntinued increases in mill recveries 2

3 Fr the six mnths ended June 30, 2012, gld prductin at each f the sites remained bradly cnsistent with that f the prir year perid, as small changes in tnnes mined, gld grades and recveries largely ffset ne anther. The difference in gld sales during bth cmparative perids is attributable t the timing f gld sales and related inventry mvements. Silver Prductin and Sales During the secnd quarter, silver prductin at Cerr San Pedr increased by 14% when cmpared t the same perid f the prir year. This increase in prductin was attributable t an 18% increase in the silver grade which was nly partially ffset by fewer re tnnes being placed n the leach pad during the quarter. Fr the six mnths ended June 30, 2012, silver prductin was belw that f the prir year perid as the impact f fewer re tnnes being placed n the leach pad was nly partially ffset by the mining f higher grade silver. The difference in silver sales during bth cmparative perids is a result f timing f silver sales and related inventry mvements. Cpper Prductin and Sales Cpper prductin at the Peak Mines increased by 18% when cmpared t the same perid f the prir year. The increase was driven by imprved cpper grades and recveries. The even mre significant increase in cpper sales during the secnd quarter was due t a cmbinatin f the abve nted increase in prductin as well as the sale f a significant prtin f the cpper cncentrate inventry that had built up at the end f the first quarter f Fr the six mnths ended June 30, 2012, cpper prductin increased by 12% when cmpared t the same perid f the prir year, with the increases attributable t higher cpper grades and recveries. The cmpany cntinues t have apprximately ne millin punds f cpper cncentrate inventry, the sale f which shuld benefit future quarters. Ttal Cash Cst (1) per Ounce Sld Net f By-Prduct Sales Ttal cash cst (1) per unce sld, net f by-prduct sales, remained well belw the industry average during the secnd quarter f 2012 at $472 per unce. The cmpany s ttal cash cst (1) decreased by $71 per unce sld when cmpared t the first quarter f 2012, hwever, increased when cmpared t the same perid f the prir year primarily as a result f lwer by-prduct revenues due t lwer realized silver and cpper prices. Mesquite Csts remained cnsistent thrugh a cmbinatin f lwer diesel prices, a higher prductin base and the site team s cntinued fcus n cst cntrl Cerr San Pedr The cmbinatin f the lwer realized silver price and slightly lwer silver sales vlumes increased csts at Cerr San Pedr when cmpared t the same perid f the prir year. This increase was partially ffset by the depreciatin f the Mexican pes. Cerr San Pedr s ttal cash cst (1) per unce sld, net f by-prduct sales, cntinues t be amng the lwest in the industry, despite the increase ver the exceptinal prir year quarter. Peak Mines Ttal cash cst (1) per unce sld, net f by-prduct sales, decreased significantly frm the first quarter f 2012 and increased mderately when cmpared t the secnd quarter f the prir year. The increase in csts at the Peak Mines is attributable t the cmbinatin f cntinued cst pressures in the Australian market and lwer realized cpper prices, which were nly partially ffset by high cpper sales vlumes and the depreciatin f the Australian dllar. After prviding sharehlders with an average realized margin f ver $1,000 per unce fr the first time in 2011, New Gld is prud t have maintained its margin abve this level in bth the first and secnd quarter f

4 Fr the six mnths ended June 30, 2012, ttal cash cst (1) per unce sld, net f by-prduct sales, was $507 per unce. The rise in csts when cmpared t the same perid f the prir year is largely driven by lwer by-prduct revenues frm a cmbinatin f lwer silver and cpper prices and sales vlumes, respectively. Further, csts at Mesquite in the first half f 2011 benefitted frm mining in a significantly higher grade area in the first quarter f 2011 due t mine sequencing. The strng perating perfrmance in the first half f 2012 leaves New Gld well psitined t achieve its cst guidance fr the year as the start f cmmercial prductin at New Aftn shuld drive the cmpany s csts significantly lwer in the secnd half f the year. It is gratifying t see ur mines perfrm well. Our teams delivered slid prductin at lw cash csts, stated Rbert Gallagher, President and Chief Executive Officer. The start f cmmercial prductin at New Aftn is particularly exciting. New Aftn shuld increase ur gld prductin, lwer csts and increase cash flw. Cnslidated Financial Results Overview New Gld 2012 Secnd Quarter Cnslidated - Summary Financial Results Three mnths ended Six mnths ended Figures in US$ millins, except per share amunts June 30, June 30, Revenue Earnings frm Mine Operatins Mesquite Cerr San Pedr Peak Mines Earnings frm Mine Operatins Net Earnings Net Earnings per Share Adjusted Net Earnings Adjusted Net Earnings per Share Pre-tax Cash Generated frm Operatins Net Cash Generated frm Operatins The cmbinatin f the cmpany s strng peratinal perfrmance and the cntinued strength f cmmdity prices led t slid financial results. Revenue increased during the secnd quarter while earnings frm mine peratins decreased slightly when cmpared t the same perid f the prir year as perating csts and depreciatin increased marginally. Net earnings in the secnd quarter f 2012 were $24 millin, r $0.05 per share, and were negatively impacted by a ne-time, pre-tax $32 millin lss n the redemptin f the cmpany s 10% senir secured ntes. Adjusted net earnings were $46 millin, r $0.10 per share. Net earnings have been adjusted and tax effected fr the grup f csts in Other gains (lsses) n the cndensed incme statement. See ntes at the end f the news release fr a recnciliatin f adjusted net earnings 2. Pre-tax cash generated frm peratins in the secnd quarter was $72 millin, which included an $8 millin wrking capital use f cash. Net cash generated frm peratins increased by 5% t $46 millin frm $44 millin in the same perid f the prir year, despite the $8 millin wrking capital use f cash. The increase in net cash generated frm peratins is attributable t a cmbinatin f slid peratinal perfrmance and lwer cash tax expense than the prir year quarter. 4

5 Fr the six mnths ended June 30, 2012, revenue increased despite lwer realized silver and cpper prices. Earnings frm mine peratins were dwn slightly when cmpared t the same perid f the prir year as perating csts and depreciatin increased by 6% and 9%, respectively. Net earnings in the first six mnths f 2012 were $57 millin, r $0.12 per share. Adjusted net earnings were $91 millin, r $0.20 per share. Pre-tax cash generated frm peratins and net cash generated frm peratins in the first six mnths f 2012 were $138 millin and $83 millin, respectively. With the start f prductin at New Aftn, the cmpany anticipates that its cash flw generatin shuld increase meaningfully in the secnd half f Balance Sheet During the secnd quarter, New Gld successfully cmpleted a 7.0% $300 millin senir ntes ffering. The cmpany used $198 millin f the prceeds frm the ntes ffering t redeem its previus 10% senir secured ntes, with the remaining prceeds further increasing New Gld s cash psitin and financial flexibility. The new senir ntes reduce the interest rate n the debt by 3.0%, extend the repayment date by three years frm 2017 t 2020 and prvide the cmpany with the flexibility t pay dividends in the future. As at June 30, 2012, the key cmpnents f New Gld s cnslidated statements f financial psitin include: Cash and cash equivalents f $230 millin Cnslidated debt f $385 millin, including: 7% senir ntes f $292 millin due in % cnvertible debenture f $47 millin (face value f C$55 millin) due in 2014 with a cnversin price f C$9.35 El Mrr funding lans f $46 millin Basic shares utstanding 462 millin Develpment Update New Aftn Delivers On-time Prductin and Successful Ramp-up t Cmmercial Prductin The secnd quarter marked the fficial start f prductin at New Aftn as the first re was prcessed thrugh the mill n June 28 th. After successfully cmmencing undergrund mining peratins in the third quarter f 2011, the team at New Aftn met the scheduled June prductin start and New Aftn has nw achieved cmmercial prductin ahead f its August target. Cmmercial prductin is defined as 30 days f peratin at an average f 60% f the 11,000 tnne per day capacity, r 6,600 tnnes per day. The start-up has been cnsistent with the cmpany s expectatins and daily milling rates have steadily increased thrugh the mnth f July. Daily mill thrughput has averaged 11,129 tnnes ver the last five days. The cmpany lks frward t benefitting frm New Aftn s significant, lw-cst gld and cpper prductin and resulting cash flw generatin. 5

6 New Aftn 2012 Highlights Cmmercial prductin achieved n July 31 st, ahead f August target Average daily milling rate ver last five days f 11,129 tnnes per day Average daily milling rate in mnth f July f 7,428 tnnes per day First cncentrate trucked t Vancuver wharves n July 5 th Average daily undergrund mining rate nw up t 5,700 tnnes per day 33 drawbells currently cmpleted t supprt the cntinued increase in mining rate Ore stckpiled n surface at July 31, 2012 ttaled 946,000 tnnes Gld and cpper recveries in the 80 t 85 percent range, trending abve expectatin fr the cmmissining stage The cmpany s guidance fr New Aftn in the secnd half f 2012 remains unchanged with expected prductin f 35,000 t 45,000 unces f gld and 30 t 35 millin punds f cpper at ttal cash cst (1), net f by-prduct credits, f ($1,200) t ($1,300) per unce. On a c-prduct basis, the ttal cash cst (1) is expected t be $630 t $650 per unce f gld and $1.35 t $1.45 per pund f cpper, respectively. Bth the by-prduct and c-prduct csts at New Aftn are expected t decline meaningfully in 2013 and beynd as the mine hits its full capacity. New Aftn s prductin estimate includes gld and cpper prduced between the June 28 th mill start-up and yesterday s achievement f cmmercial prductin. The revenue frm this pre-cmmercial prductin will be ffset against capital csts. New Aftn gld and cpper sales fr 2012 frm the pint f cmmercial prductin frward are expected t be 20,000 t 30,000 unces and 20 t 25 millin punds, respectively. Prject spending at New Aftn in the secnd quarter f 2012 was $97 millin, excluding capitalized interest f $6 millin, bringing the ttal capital spending fr the six mnths ended June 30, 2012 t $172 millin, excluding capitalized interest f $13 millin. The year-t-date capital spending excludes the abve nted revenue ffset as there were n sales at New Aftn between the June 28 th prductin start and the end f the secnd quarter. The remaining prject develpment capital frm the perid f cmmercial prductin thrugh the end f 2012 is frecast t be apprximately $40 millin and includes the installatin f the gyratry crusher and the cmpletin f the remaining ventilatin raises. Over its currently estimated 12 year mine life, New Aftn is expected t prduce an average f 85,000 unces f gld and 75 millin punds f cpper annually at a ttal cash cst (1), net f by-prduct credits, f apprximately ($1,750) per unce. The ttal c-prduct cash cst (1) is expected t be apprximately $525 per unce f gld and $1.15 per pund f cpper. As prductin has nw started, New Gld s explratin team has cmmenced drilling f the C-zne blck f mineralizatin that lies belw and t the side f the New Aftn reserve blck in an effrt t add t the mine s base 12 year life. The drill prgram was initiated immediately subsequent t the end f the quarter n July 4 th, with tw drills explring this zne f mineralizatin. New Gld has budgeted $5 millin fr this explratin at New Aftn in the secnd half f

7 Rbust Explratin Prgram at Blackwater Leads t Further Increase in Gld Resurces Blackwater cntinued its rapid prgressin during the secnd quarter f Bth the explratin and prject develpment teams were successful in advancing the prject, with a fcus n the near-term milestne f delivering a Preliminary Ecnmic Assessment ( PEA ) in September f New Gld s July mineral resurce update at Blackwater will frm the basis fr the upcming PEA and the team is incrprating this additinal gelgic infrmatin int its envirnmental, technical and financial studies. Blackwater 2012 Highlights 19 drills currently active n the Blackwater prject 13 drills fcused n further resurce delineatin and infill drilling at the primary Blackwater depsit Three drills testing mineralizatin ptential f prpsed infrastructure sites Tw drills explring ptential t expand resurce base f the Capse gld-silver depsit, lcated 25 kilmetres nrthwest f primary Blackwater depsit One drill cmpleting getechnical drilling On July 18 th, annunced an updated Natinal Instrument cmpliant mineral resurce estimate at Blackwater, which includes: Indicated gld resurce: 230 millin tnnes at an average grade f 0.96 grams per tnne cntaining 7.1 millin unces f gld at a 0.40 gld-equivalent gram per tnne cut-ff grade Inferred gld resurce: 98 millin tnnes at an average grade f 0.77 grams per tnne cntaining 2.5 millin unces f gld at a 0.40 gld-equivalent gram per tnne cut-ff grade Reginal explratin prgram, including mapping and gechemical sampling, started n the cmpany s brader 1,000 square kilmetre land psitin Opened reginal ffice and sample preparatin lab in Vanderhf PEA n schedule fr September 2012 Ttal capital spending at Blackwater, including explratin and infrastructure-related expenditures, in the secnd quarter f 2012 was $30 millin, excluding capitalized interest f $2 millin. The ttal capital spending fr the six mnths ended June 30, 2012 was $57 millin. The cmpany lks frward t prgressing Blackwater thrugh the remainder f 2012 and beynd. Driven by the cntinued explratin success, New Gld is nw targeting the cmpletin f ver 250,000 metres f drilling in the Blackwater area during 2012 versus the previus target f 210,000 metres. The frecasted capital fr 2012 at Blackwater has increased by $20 millin as a result f this mre rbust explratin prgram. As the mst recent July mineral resurce update incrprated 151 hles ttaling 57,064 metres f the ttal 2012 target, New Gld intends t prvide further explratin updates n the Blackwater prject thrugh the secnd half f the year. 7

8 Curt Decisin Validates New Gld s Exercise f Right f First Refusal and Partnership with Gldcrp at El Mrr On June 27, 2012, the Ontari Superir Curt f Justice (the Curt ) publicly released its decisin regarding the wnership interests in the El Mrr prject in Chile. The Curt s decisin cnfirmed that New Gld and Gldcrp will cntinue as partners in the El Mrr prject. The Curt dismissed Barrick Gld Crpratin s ( Barrick ) attempt t claim it shuld have been New Gld s partner. Based n the decisin, the El Mrr transactin between New Gld and Gldcrp, which clsed n February 16, 2010, will stand. The perid in which Barrick culd have appealed this decisin has nw expired. New Gld hlds a fully carried 30 percent interest in the El Mrr prject and Gldcrp, the prject develper and peratr, hlds the remaining 70 percent. El Mrr is an advanced stage, wrld-class cpper/gld prject in nrthern Chile. Develpment activity at site during the secnd quarter was limited due t the previusly annunced temprary suspensin f the prject s envirnmental permit, pending the reslutin by the Chilean Envirnmental Permitting Authrity (the "Servici de Evaluación Ambiental" r "SEA") f certain deficiencies in the cnsultatin with a grup f indigenus peple. On June 22 nd, SEA initiated the administrative prcess t address the deficiencies identified by the Chilean curt. During the perid f temprary suspensin, Gldcrp s fcus is n prject engineering and related activities in rder t maintain the current prject schedule. Detailed engineering f pipelines, pwer line twers and the desalinatin plant are expected in the furth quarter f Equipment selectin is als nging. Once in prductin, New Gld's 30 percent share f annual prductin is expected t be ver 90,000 unces f gld and 85 millin punds f cpper ver an initial 17-year mine life. Life-f-mine cash cst is expected t be apprximately ($700) per unce f gld n a by-prduct basis and apprximately $550 per unce f gld and $1.45 per pund f cpper n a c-prduct basis. Metals price assumptins used t calculate the average life-fmine El Mrr cash cst are $1,200 per unce f gld and $2.75 per pund f cpper. Under the terms f New Gld s agreement with Gldcrp, Gldcrp is respnsible fr funding New Gld s 30% share f capital csts. The carried funding will accrue interest at a fixed rate f 4.58%. New Gld will repay its share f capital plus accumulated interest ut f 80% f its share f the prject s cash flw with New Gld retaining 20% f its share f cash flw frm the time prductin cmmences. Crprate Update New Gld is very pleased t annunce the additin f tw individuals wh will further strengthen the cmpany s Bard f Directrs and senir management team. The Hnurable David L. Emersn was appinted t the cmpany s Bard f Directrs effective July 1, Mr. Emersn has extensive experience in Canada's public and private sectrs. With the Gvernment f Canada, he has served as the Minister f Freign Affairs, Minister f Internatinal Trade, and Minister f Industry. In the private sectr, Mr. Emersn was the President and Chief Executive Officer f Canfr Crpratin, President and Chief Executive Officer f the Vancuver Internatinal Airprt, and Chairman and Chief Executive Officer f Canadian Western Bank. He currently serves n the Bards f Maple Leaf Fds Inc. (Chairman), Finning Internatinal Inc., Stantec Inc. and Pstmedia Netwrks Inc. Mr. Emersn hlds Bachelr and Master Degrees in Ecnmics frm the University f Alberta and a Dctrate in Ecnmics frm Queen s University. On July 16, 2012, Ernie Mast jined New Gld as Vice President Operatins. Mr. Mast brings a tremendus amunt f perating experience t the cmpany. He will versee the cmpany s fur currently prducing mines: Mesquite, Cerr San Pedr, Peak Mines and New Aftn and becme a key member f the management team. Mr. Mast is a Metallurgical Engineer with significant experience with bth perating and develpment-stage prjects. Mst recently, he was a key member f Inmet Mining Crpratin s management team, leading the develpment f its Cbre Panama prject. Prir t this, he mved int prgressively mre senir rles ver 20 years with Xstrata Plc and certain predecessr cmpanies including Nranda Inc. and Falcnbridge Limited. 8

9 Outlk fr 2012 New Gld is pleased t reiterate its guidance fr The cmpany frecasts gld prductin f 405,000 t 445,000 unces at a ttal cash cst (1) per unce sld, net f by-prduct sales, f $410 t $430 per unce. As utlined in the cmpany s February 2012 guidance news release, gld prductin was anticipated t be steady in the first tw quarters f the year and then mve higher with the benefit f prductin frm New Aftn in the secnd half f A steady decline in ttal cash cst (1) was als anticipated frm the first quarter thrugh the end f the year as evidenced by the decrease in csts frm the first t secnd quarter. With New Aftn having nw reached cmmercial prductin, this trend f declining csts shuld nly accelerate. Beynd the expectatin f a strng peratinal secnd half f 2012, the cmpany lks frward t a number f ther imprtant catalysts. Certain highlights in the secnd half f the year shuld include: the Blackwater PEA, cntinued prgress at El Mrr and explratin results frm Blackwater and Capse as well as results frm the New Aftn explratin prgram. New Gld is pleased that 2012 is ff t such a strng start and is even mre excited abut the ptential f the secnd half f the year. New Gld 2012 Prductin and Cst Guidance Gld Silver Cpper (000 Ounces) (000 Ounces) (Millin punds) Ttal Cash Cst (1) Mesquite $710-$730 Cerr San Pedr ,900-2, $250-$270 Peak Mines $640-$660 New Aftn ($1,200)-($1,300) New Gld Ttal ,900-2, $410-$430 Nte: New Aftn prductin range includes gld and cpper prduced between mill start-up and achievement f cmmercial prductin. The revenue frm this pre-cmmercial prductin will be ffset against capital csts. New Aftn gld and cpper sales frm the pint f cmmercial prductin frward are expected t be 20,000 t 30,000 unces and 20 t 25 millin punds, respectively. Assumptins used in the 2012 guidance include gld, silver and cpper prices f $1,600 per unce, $30.00 per unce and $3.50 per pund, respectively, and Canadian dllar, Australian dllar and Mexican pes exchange rates f $1.00, $1.00 and t the U.S. dllar, respectively. The diesel price assumed fr 2012 is $3.30 per galln. Abut New Gld Inc. New Gld is an intermediate gld mining cmpany. The cmpany has a prtfli f fur prducing assets and tw significant develpment prjects. New Gld s New Aftn prject met its targeted June 2012 prductin start and began cmmercial prductin ahead f schedule in July Tgether with the Mesquite Mine in the United States, the Cerr San Pedr Mine in Mexic and Peak Gld Mines in Australia, the cmpany is frecasting between 405,000 and 445,000 unces f gld prductin in In additin, New Gld wns 30% f the wrldclass El Mrr prject lcated in Chile and 100% f the exciting Blackwater prject in Canada. Fr further infrmatin n the cmpany, please visit 9

10 Cautinary Nte Regarding Frward-Lking Statements Certain infrmatin cntained in this news release, including any infrmatin relating t New Gld's future financial r perating perfrmance may be deemed "frward lking". All statements in this news release, ther than statements f histrical fact, that address events r develpments that New Gld expects t ccur, are "frward-lking statements. Frward-lking statements are statements that are nt histrical facts and are generally, but nt always, identified by the use f frward-lking terminlgy such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "frecasts", "intends", "anticipates", prjects, ptential, "believes" r variatins f such wrds and phrases r statements that certain actins, events r results "may", "culd", "wuld", shuld, "might" r "will be taken", "ccur" r "be achieved" r the negative cnntatin. All such frward-lking statements are based n the pinins and estimates f management as f the date such statements are made and are subject t imprtant risk factrs and uncertainties, many f which are beynd New Gld's ability t cntrl r predict. Frward-lking statements are necessarily based n estimates and assumptins that are inherently subject t knwn and unknwn risks, uncertainties and ther factrs that may cause actual results, level f activity, perfrmance r achievements t be materially different frm thse expressed r implied by such frward-lking statements. Such factrs include, withut limitatin: significant capital requirements; fluctuatins in the internatinal currency markets and in the rates f exchange f the currencies f Canada, the United States, Australia, Mexic and Chile; price vlatility in the spt and frward markets fr cmmdities; impact f any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated prductin, between actual and estimated reserves and resurces and between actual and estimated metallurgical recveries; changes in internatinal, natinal and lcal gvernment legislatin in Canada, the United States, Australia, Mexic and Chile r any ther cuntry in which New Gld currently r may in the future carry n business; taxatin; cntrls, regulatins and plitical r ecnmic develpments in the cuntries in which New Gld des r may carry n business; the speculative nature f mineral explratin and develpment, including the risks f btaining and maintaining the validity and enfrceability f the necessary licenses and permits and cmplying with the permitting requirements f each jurisdictin that New Gld perates, including, but nt limited t Mexic where the Cerr San Pedr mine has a histry f nging legal challenges related t ur EIS and Chile where the curts have temprarily suspended the apprval f the envirnmental permit fr the El Mrr prject; the lack f certainty with respect t freign legal systems, which may nt be immune frm the influence f plitical pressure, crruptin r ther factrs that are incnsistent with the rule f law; the uncertainties inherent t current and future legal challenges the cmpany is r may becme a party t,; diminishing quantities r grades f reserves; cmpetitin; lss f key emplyees; additinal funding requirements; actual results f current explratin r reclamatin activities; changes in prject parameters as plans cntinue t be refined; accidents; labur disputes; defective title t mineral claims r prperty r cntests ver claims t mineral prperties. In additin, there are risks and hazards assciated with the business f mineral explratin, develpment and mining, including envirnmental hazards, industrial accidents, unusual r unexpected frmatins, pressures, cave-ins, flding and gld bullin lsses (and the risk f inadequate insurance r inability t btain insurance t cver these risks) as well as "Risk Factrs" included in New Gld's disclsure dcuments filed n and available at Frward-lking statements are nt guarantees f future perfrmance, and actual results and future events culd materially differ frm thse anticipated in such statements. All f the frward-lking statements cntained in this news release are qualified by these cautinary statements. New Gld expressly disclaims any intentin r bligatin t update r revise any frward-lking statements, whether as a result f new infrmatin, events r therwise, except in accrdance with applicable securities laws. Cautinary Nte t U.S. Readers Cncerning Estimates f Measured, Indicated and Inferred Mineral Resurces Infrmatin cncerning the prperties and peratins discussed in this news release has been prepared in accrdance with Canadian standards under applicable Canadian securities laws, and may nt be cmparable t similar infrmatin fr United States cmpanies. The terms "Mineral Resurce", "Measured Mineral Resurce", "Indicated Mineral Resurce" and "Inferred Mineral Resurce" used in this news release are Canadian mining terms as defined in accrdance with NI under guidelines set ut in the Canadian Institute f Mining, Metallurgy and Petrleum ("CIM") Standards n Mineral Resurces and Mineral Reserves adpted by the CIM Cuncil n December 11, While the terms "Mineral Resurce", "Measured Mineral Resurce", "Indicated Mineral Resurce" and "Inferred Mineral Resurce" are recgnized and required by Canadian regulatins, they are nt defined terms under standards f the United States Securities and Exchange Cmmissin. Under United States standards, mineralizatin may nt be classified as a "reserve" unless the determinatin has been made that the mineralizatin culd be ecnmically and legally prduced r extracted at the time the reserve calculatin is made. As such, certain infrmatin cntained in this news release cncerning descriptins f mineralizatin and resurces under Canadian standards is nt cmparable t similar infrmatin made public by United States cmpanies subject t the reprting and disclsure requirements f the United States Securities and Exchange Cmmissin. An "Inferred Mineral Resurce" has a great amunt f uncertainty as t its existence and as t its ecnmic and legal feasibility. It cannt be assumed that all r any part f an "Inferred Mineral Resurce" will ever be upgraded t a higher categry. Under Canadian rules, estimates f Inferred Mineral Resurces may nt frm the basis f feasibility r ther ecnmic studies. Readers are cautined nt t assume that all r any part f Measured r Indicated Resurces will ever be cnverted int Mineral Reserves. Readers are als cautined nt t assume that all r any part f an "Inferred Mineral Resurce" exists, r is ecnmically r legally mineable. In additin, the definitins f "Prven Mineral Reserves" and "Prbable Mineral Reserves" under CIM standards differ in certain respects frm the standards f the United States Securities and Exchange Cmmissin. TECHNICAL INFORMATION The scientific and technical infrmatin in this news release has been reviewed by Mark Petersen, a Qualified Persn under Natinal Instrument and emplyee f New Gld. 10

11 (1) TOTAL CASH COST Ttal cash cst per unce figures are calculated in accrdance with a standard develped by The Gld Institute, which was a wrldwide assciatin f suppliers f gld and gld prducts and included leading Nrth American gld prducers. The Gld Institute ceased peratins in 2002, but the standard is widely accepted as the standard f reprting cash cst f prductin in Nrth America. Adptin f the standard is vluntary and the cst measures presented may nt be cmparable t ther similarly titled measures f ther cmpanies. New Gld reprts ttal cash cst n a sales basis. Ttal cash cst includes mine site perating csts such as mining, prcessing, administratin, ryalties and prductin taxes, but is exclusive f amrtizatin, reclamatin, capital and explratin csts. Ttal cash cst is reduced by any by-prduct revenue and is then divided by unces sld t arrive at the ttal by-prduct cash cst f sales. The measure, alng with sales, is cnsidered t be a key indicatr f a cmpany s ability t generate perating earnings and cash flw frm its mining peratins. This data is furnished t prvide additinal infrmatin and is a nn-ifrs measure. Ttal cash cst presented des nt have a standardized meaning prescribed by IFRS and may nt be cmparable t similar measures presented by ther mining cmpanies. It shuld nt be cnsidered in islatin as a substitute fr measures f perfrmance prepared in accrdance with IFRS and is nt necessarily indicative f perating csts presented under IFRS. A recnciliatin will be prvided in the MD&A accmpanying the quarterly financial statements. (2) RECONCILIATION OF ADJUSTED NET EARNINGS New Gld 2012 Secnd Quarter Cnslidated - Adjusted Net Earnings Recnciliatin Three mnths ended Six mnths ended Figures in US$ millins, except per share amunts June 30, June 30, Net earnings Net earnings per share Adjustments: Lss n Redemptin f Senir Secured Ntes Gain n FVTPL financial assets (1.3) Ineffectiveness n hedging instruments Fair value change f nn-hedged derivatives (11.1) (33.3) (2.5) (6.6) (Gain) Lss n freign exchange (0.5) (2.0) Other (0.2) Tax impact f adjustments 0.1 (0.4) (0.4) (2.7) 22.1 (28.8) 33.7 (6.7) Adjusted net earnings Adjusted net earnings per share Fr further infrmatin please cntact: Hannes Prtmann Vice President, Crprate Develpment Direct: +1 (416) inf@newgld.cm 11

12 CONDENSED CONSOLIDATED INCOME STATEMENTS THREE AND SIX MONTHS ENDED JUNE 30, 2012 (unaudited) Three mnths ended Six mnths ended $ $ $ $ (In millins f U.S. dllars, except per share amunts) Revenues Operating expenses Depreciatin and depletin Earnings frm mine peratins Crprate administratin Share-based payment expenses Explratin and business develpment Incme frm peratins Finance incme Finance csts (0.5) (1.5) (2.6) (2.7) Other (lsses) and gains (22.0) 28.5 (34.1) 4.0 Earnings befre taxes Incme tax expense (17.0) (21.0) (35.3) (41.0) Net earnings Earnings per share Basic Diluted Weighted average number f shares utstanding ( in millins) Basic Diluted

13 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (unaudited) $ $ June 30 December 31 (In millins f U.S. dllars) Assets Current assets Cash and cash equivalents Trade and ther receivables Inventries Prepaid expenses and ther Ttal current assets Investments Nn-current inventries Mining interests 2, ,695.3 Deferred tax assets Nn-current nn-hedged derivative asset Reclamatin depsits and ther Ttal assets 3, ,221.4 Liabilities and equity Current liabilities Trade and ther payables Current tax liabilities Current derivative liabilities Current nn-hedged derivative liabilities Ttal current liabilities Reclamatin and clsure cst bligatins Prvisins Nn-current derivative liabilities Nn-current nn-hedged derivative liabilities Lng-term debt Deferred tax liabilities Deferred benefit Other Ttal liabilities 1, Equity Cmmn shares 2, ,464.0 Cntributed surplus Other reserves Deficit (86.4) (86.4) (118.3) (175.6) Ttal equity 2, ,282.4 Ttal liabilities and equity 3, ,

14 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS THREE AND SIX MONTHS ENDED JUNE 30, 2012 (unaudited) Three mnths ended Six mnths ended $ $ $ $ (In millins f U.S. dllars) Operating activities Net earnings Adjustments fr: Realized gain n gld cntracts (2.4) (2.2) (4.8) (4.2) Realized and unrealized freign exchange lss (gain) (0.5) (2.0) Realized and unrealized gain n investments (1.3) Realized and unrealized gain n nn-hedged derivatives (11.1) (33.3) (2.5) (6.6) Reclamatin and clsure csts paid (4.5) - (4.5) - Lss n redemptin f senir secured ntes Lss n dispsal f assets Depreciatin and depletin Equity-settled share-based payment expense Unrealized lss n cash flw hedging items Incme tax expense Finance incme (0.6) (0.9) (0.8) (2.0) Finance csts Change in nn-cash perating wrking capital (8.1) 0.6 (24.4) (26.8) Cash generated frm peratins Incme taxes paid (25.9) (43.6) (55.3) (54.8) Net cash generated frm peratins Investing activities Mining interests (145.3) (85.9) (255.4) (143.1) Purchase f additinal Blackwater mining claims - - (6.0) - Recvery f reclamatin depsits Cash acquired in asset acquisitin, net transactin csts Prceeds frm sale f investments Interest received Prceeds frm dispsal f assets Cash used in investing activities (136.0) (66.8) (251.9) (105.8) Financing activities Exercise f ptins t purchase cmmn stck Exercise f warrants t purchase cmmn stck Redemptin f senir secured ntes (197.6) - (197.6) - Prceeds frm issuance f senir ntes Financing initiatin csts (6.4) (0.3) (8.0) (0.8) Interest paid (7.6) (11.2) (7.6) (11.5) Cash generated by financing activities 89.9 (10.1) Cash generated frm (used in) discntinued peratins Effect f exchange rate changes n cash and cash equivalents (5.4) 3.2 (1.6) 11.2 Decrease in cash and cash equivalents (5.3) (29.8) (79.0) (0.4) Cash and cash equivalents, beginning f perid Cash and cash equivalents, end f perid Cash and cash equivalents are cmprised f: Cash Shrt-term mney market instruments