Thursday, July 03, 2014

Lake Shore Gold Reports Record Production of 52,300 Ounces in Second Quarter 2014

13:56 EDT Thursday, July 03, 2014

TORONTO, ONTARIO--(Marketwired - July 3, 2014) - Lake Shore Gold Corp. (TSX:LSG)(NYSE MKT:LSG) -

• Record quarterly gold production in second quarter 2014 ("Q2/14") of 52,300 ounces, 70% increase from second quarter 2013 ("Q2/13")
  
  
• Record six-month gold production in first half 2014 ("H1/14") of 96,900 ounces, 79% increase from first half 2013 ("H1/13")
  
  
• Company now targeting top end of production guidance for 2014 of 160,000 to 180,000 ounces of gold
  
  
• Approximately $17 million of debt repaid in H1/14
  
  
• Cash and bullion totaled approximately $53.0 million at June 30, 2014.
  
  

Lake Shore Gold Corp. ("Lake Shore Gold" or the "Company") today announced record quarterly and six-month production in Q2/14 and H1/14. A total of 52,300 ounces of gold was produced in Q2/14, an increase of 70% from Q2/13. Mill throughput during Q2/14 totaled 309,800 tonnes (approximately 3,400 tonnes per day) at an average grade of 5.4 grams per tonne with average mill recoveries of 96.6%. The Company both poured and sold 53,500 ounces of gold during Q2/14, with an average selling price of US$1,289 per ounce. The Company's cash and bullion totaled approximately $53.0 million at June 30, 2014.

In H1/14, the Company produced 96,900 ounces of gold, an increase of 79% from 54,000 ounces in H1/13. Total mill throughput was 593,600 tonnes (approximately 3,280 tonnes per day) at an average grade of 5.3 grams per tonne. Gold poured during H1/14 totaled 99,200 ounces, while the Company sold 96,500 ounces of gold at an average selling price of US$1,291 per ounce. Based on results in H1/14, the Company now expects to achieve the top end of its 2014 production guidance of 160,000 to 180,000 ounces of gold.

		Three Months Ended			Six Months Ended
		June 30,		March 31,		June 30,			June 30,		June 30,
		2014		2014		2013			2014		2013
Tonnes milled		309,800		283,800		230,920			593,600		428,560
Recovery (%)		96.6		96.6		95.6			96.6		95.6
Grade (grams/tonne)		5.4		5.1		4.3			5.3		4.1
Gold Ounces
	Production		52,300		44,600		30,800			96,900		54,000
	Poured		53,500		45,700		31,800			99,200		52,300
	Sales		53,500		43,000		27,600			96,500		53,700
Gold price (US$/ounce)		1,289		1,294		1,409			1,291		1,516
Gold price ($/ounce)		1,404		1,430		1,441			1,416		1,539

Tony Makuch, President and CEO of Lake Shore Gold, commented: "We are very pleased with our operating results in the first half of 2014, which include production, throughput and average grades all meeting or exceeding expected levels. Driven by our strong performance, we have generated significant free cash flow, with our cash and bullion rising to approximately $53 million at June 30, 2014. We have also repaid approximately $17 million of debt so far in 2014, including a $10 million prepayment on our standby line of credit on June 4th. Supported by our growing financial strength, we have resumed drilling at our mines to grow reserves and resources and extend mine life. We are also advancing work at a number of our key growth projects, and will soon commence drilling at our 144 property, a very exciting exploration target located adjacent to our Thunder Creek deposit.

"Looking ahead, we now expect to achieve the top end of our full-year 2014 production guidance of 160,000 to 180,000 ounces of gold. In addition to building on our track record of meeting and exceeding our key targets, our priorities for increasing value include continuing to grow our cash position and further reducing debt. We are also working to extend mine life and to realize value from our many attractive growth projects and exploration properties, all located in close proximity to our existing mines."

The Company's full financial results for Q2/14 and H1/14 will be released before the market opens on July 31, 2014, with a conference call and webcast to follow that afternoon at 3 pm. Details of the conference call and webcast will be released shortly.

Qualified Person

Scientific and technical information contained in this press release related to reserves has been reviewed and approved by Natasha Vaz, P.Eng., Vice-President, Technical Services. Ms. Vaz is an employee of Lake Shore Gold Corp., and a "qualified person" as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101").

Scientific and technical information related to resources, drilling and all matters involving mine production geology contained in this press release, or source material for this press release, was reviewed and approved by Eric Kallio, P.Geo., Vice-President, Exploration. Mr. Kallio is an employee of Lake Shore Gold Corp., and is a "qualified person" as defined by NI 43-101.