Nordgold Reports Q1 2014 Financial Results

Amsterdam, Netherlands, May 15, 2014. Nord Gold N.V. (“Nordgold” or the “Company”, LSE: NORD), the internationally diversified, pure-play gold producer strategically focused on emerging markets, announces its financial and operating results for the first quarter ended March 31, 2014.

Financial Highlights

• Revenue in Q1 2014 was US$274.9 million, a 7% decrease compared with US$296.8 million in Q1 2013 due to the significantly lower average realised gold price. Revenue for Q1 2014 decreased by 16% compared with US$328.8 million in Q4 2013 as a result of lower refined gold production and sales volumes.
• Despite a 20% decrease in the average realised gold price in Q1 2014 compared with Q1 2013, EBITDA for the reporting quarter increased by 6% year-on-year («YoY») to US$103.5 million driven by higher production and strict cost control, which offset lower prices. EBITDA also increased by 3% compared with US$100.7 million in Q4 2013 mainly due to higher average realised gold price (up 4% quarter-on-quarter) as well as lower costs. EBITDA margin for Q1 2014 was 37.6% compared with 33.0% in Q1 2013 and 30.6% in Q4 2013.
• Net income for Q1 2014 was US$24.6 million, up 68% compared with US$14.6 million in Q1 2013.
• In Q1 2014, total cash costs («TCC») were US$719 per ounce, a 25% decrease compared with Q1 2013 (US$956/oz) and a 5% decrease compared with Q4 2013 (US$755/oz) mainly due to improved operational and consumption efficiency. The main drivers of the quarter-on-quarter («QoQ») TCC improvement were Buryatzoloto (down 15%), Neryungri (down 13%), Taparko (down 8%) and Lefa (down 2%). We continue to implement cost optimisation programmes at all our mines.
• In Q1 2014, all nine of Nordgold’s mines achieved significant improvement in all-in sustaining costs (AISC) (1) compared with Q1 2013. As a result, Nordgold’s consolidated AISC were US$881/oz in Q1 2014, which is 27% lower compared to Q1 2013 (US$1,204/oz) due to higher production, lower TCC and capex. We reiterate our consolidated AISC guidance of US$1,050/oz — US$1,100/oz for the full year 2014.
• In Q1 2014 Nordgold generated US$49.8 million of cash flow from operating activities (after interest and income tax paid), compared with US$40.0 million in Q1 2013. Nordgold’s cash flows for the reporting period would potentially have been higher if the 20.1 thousand ounces of doré produced at Suzdal in Q1 2014 had been converted to refined metal. In Q1 2014, Suzdal’s refined gold production and sales were affected by negotiations with the National Bank of Kazakhstan and a newly built refinery plant «Tau-Ken Altyn». The issue was resolved in April 2014 and Suzdal’s doré produced in Q1 2014 has been refined and sold during Q2 2014.
• Capital expenditure ("capex«)(1) for Q1 2014 was US$22.4 million (including US$5.4 million for exploration and evaluation), down 65% from Q1 2013 and 60% from Q4 2013. Nordgold reiterates 2014 capex guidance of approximately US$200 million, including exploration costs of US$60 million.
• The Company delivered US$22.9 million of positive free cash flow (1) in Q1 2014 compared with negative free cash flow of US$28.3 million in Q1 2013 on the back of higher operating cash flow and significantly lower capex.
• Cash and cash equivalents as at March 31, 2014 were US$270.5 million with net debt at US$729.8 million, compared with US$244.0 million cash and cash equivalents as at December 31, 2013, and net debt of US$723.9 million.
• The Board of Directors has approved an interim dividend of 1.53 US cents per share or per Global Depositary Receipt in respect of the three months ended March 31, 2014.

(1) For detailed definition, please see «Non-IFRS Financial Measures»

“I am pleased to announce a robust financial performance for the first quarter. A very strong operating performance with increased production across all our mine sites, combined with a focus on cost management has more than offset a sharp decline in the price of gold and we have delivered a 6% rise in EBITDA in the quarter, in a sector which is seeing considerable challenges. I am particularly pleased to see the sharp 27% decrease in all in sustaining costs. The results show the significant progress we have made in managing our cost base carefully, improving efficiency across our mine sites — a great testament to the quality of our staff. We are not complacent. We anticipate AISC will increase during the year due to higher capex and we remain committed to ensuring all our operations are run as efficiently and above all, safely as possible. Looking ahead, we will remain highly vigilant on costs and seeking to find further operational efficiencies across our portfolio, while carefully seeking to develop our growth projects.” Nikolai ZelenskiChief Executive Officer of Nordgold

Telephone Conference and Q&A Session

Nikolai Zelenski, Chief Executive Officer of Nordgold and Louw Smith, Chief Operating Officer will present the Company’s financial and operating results for the first quarter of 2014 on a conference call to be held on May 15, 2014 at 11.30 pm London time (BST). The presentation will be followed by a Q&A session. To participate in the telephone conference, please register in advance.

Registration Details

Conference Title: Nordgold Presentation of Q1 2014 Financial Results

To participate in the telephone conference, please dial:

Great Britain

+44 203 367 9454

USA

+1 855 402 7763

Russia

+7 495 705 9472

Webcast

The presentation will be broadcast live over the Internet and will also be available as a recording after the conference.

To participate in the webcast please follow the link: