Nordgold Reports Q4 2012 and FY 2012 Financial and Operating Results

Amsterdam, Netherlands, March 1, 2013 – Nord Gold N.V, (“Nordgold” or the “Company”, LSE: NORD), an independent, internationally diversified, pure-play gold producer strategically focused on emerging markets, announces its financial and operating results for the fourth quarter and full year December 31, 2012.

“2012 was an important year in the development of Nordgold as a leading, pure play gold producer focused on emerging markets. We have met a series of challenges successfully, addressing mechanical bottlenecks at certain mine sites, increasing our reserve base by more than 50%, completed a complex transaction with High River Gold and successfully launched a major development project. We enter 2013 in a stronger position. I am confident about the year ahead and the long term sustainable growth of the business and I am delighted to announce our maiden dividend.” Nikolai ZelenskiChief Executive Officer of Nordgold

Full Year 2012 Highlights

Revenues

• US$ 1,197.9 million
• Up 1% (or US$15.7 million) from FY 2011. Marginal growth in full year revenues was mainly due to higher gold prices during the period (up 7%), which were offset by lower sales volumes (down 5%)

EBITDA

• US$ 493.0 million
• Down 14% (or US$81.3 million) from FY 2011. EBITDA in 2012 was negatively impacted by lower production and cost inflation at certain mines in the first half of the year
• EBITDA margin for the full year 2012 was 41%

Cash flow from operating activities

• US$ 121.6 million
• A year over year decrease in cash flow from operating activities was mainly driven by the first half of the year when we generated US$2.4 million in cash flow from operations. This included a one-off payment of the accumulated interest on debt financing from the OJSC Severstal loan, amounting to US$42.0 million.

Gold production

• 716.9 thousand ounces
• FY 2012 gold production of 716.9 thousand gold equivalent ounces («koz»), a 5% decrease on FY 2011 (754.5 koz). Production decrease was mainly driven by the weaker production at Lefa, Taparko, Buryatzoloto and Neryungri

Financial Highlights

• The Board of Directors of Nordgold, has proposed to pay a dividend to the shareholders for the first time since the company’s inception. The Board recommends a dividend of 11.8 cents per share (US$ 0.118) or per Global Depositary Receipt for the full year 2012.
• Average realised gold price for the full year 2012 was US$1,670/oz a 7% increase compared to US$ 1,567/oz for the previous year.
• Capital expenditures («Capex») programme for 2012 was on budget and on schedule with US$474.4 million (including US$120.3 million for exploration) spent during the full year 2012.
• The Company’s cash and cash equivalents at December 31, 2012 were US$45.0 million with net debt at $680.5 million, compared to US$102.4 million cash and cash equivalents at September 30, 2012, giving net debt of $420.8 million. The decrease in cash position and increase in net debt is largely due to US$175.7 cash used for the offer to purchase all of the shares of High River Gold not held by Nordgold and investing activities, with the US$194.3 million used for capital construction at Bissa. The construction work is now completed and on 17 January 2013, Nordgold announced its first gold pour at Bissa. The Company’s cash and cash equivalents at December 31, 2011 were US$217.1 million with net debt at $183.3 million
• Total cash costs ("TCC")(3) for 2012 amounted to US$836 per ounce, which was higher than 2011 (FY 2011: US$688 per ounce). This increase was due lower production level resulting in increased fixed cost per ounce, lower recovery levels together with inflation and the increased usage of spare parts and other consumables on certain mines. TCC for Q4 2012 were in line with the previous quarter showing a marginal increase of 1% from US$837 to US$844 per ounce. The increase was a result of a negative forex effect during the period.
• Net income for FY 2012 was US$ 76.0 million compared to US$ 252.0 million in FY 2011. In accordance to the Company’s accounting policies we reviewed the carrying value of goodwill, exploration and evaluation assets and inventories and other operating assets accounted on the Company’s balance sheet. We’ve also performed review of the estimations and assumptions used in the preparation of the financial statements. This resulted in non-cash write-offs and impairments of approximately US$102.0 million. The amount consists of a US$ 34.7 million decrease in goodwill from the acquisition of Celtic Resources Holdings Plc, a US$ 6.8 million decrease in exploration and evaluation assets for the Balazhal exploration, and a US$ 1.6 million decrease in mineral rights relating to the Ostantsovy mineral deposit. The effect of the change in accounting estimates resulted in a decrease of the inventories of US$48.2 million due to revised assumptions of the average stripping ratio on Lefa and Taparko and US$10.7 million due to re-estimation of recoverability of gold from leaching heaps on Balazhal and Zherek.

Q4 2012 Highlights

Revenues

• US$ 346.8 million
• Up 8% (or US$24.3 million) from Q3 2012. Revenue growth was mainly due to higher gold prices (up 2%; Q4 2012: US$1,711; Q3 2012: US$1,670) and the increase in volumes of gold sold (up 5%; Q4 2012: 202.7koz; Q3 2012: 193.2koz)

EBITDA

• US$ 143.8 million
• Up 9% (US$12.3 million) from Q3 2012. EBITDA was positively impacted by higher production and cost control measures at certain mines. EBITDA margin for Q4 2012 was 41.5%

Cash flow from operating activities

• US$ 50.6 million
• Down 26% (or US$18.0 million) from Q3 2012. QoQ decrease in cash flow from operating activities was due to higher amount of interest paid

Gold production

• 201.9 thousand ounces
• Q4 2012 gold production of 201.9 koz, a 4% increase on Q3 2012 (194.0 koz). Production increase was mainly driven by the improved production at Lefa, Taparko and Berezitovy