GoGold Reports Q3 Financial Results

Trading Symbol: TSX: GGD
Shares Outstanding: 171,376,481

HALIFAX, Aug. 14, 2017 /CNW/ - GoGold Resources Inc. (TSX: GGD) ("GoGold", "the Company") announces the release of financial results for the quarter ending June 30, 2017. Revenue attributed to the Parral tailings project ("Parral") was $4.65 million (of total revenue of $5.02 million) on the sale of 286,063 silver equivalent ounces at a cash cost of $9.61 per silver equivalent ounce (including Santa Gertrudis high-grade, total sales were 310,833 silver equivalent ounces at a cash cost of $16.20 per ounce) (all amounts are in U.S. dollars).

Financial highlights for the quarter ending June 30, 2017:

• Production growth of 13% at Parral over previous quarter
• Revenue of $5.02 million from the sale of 310,833 silver equivalent ounces, a realized price of $16.15 per silver equivalent ounce
• Parral cash cost per silver equivalent ounce of $9.61
• Parral demonstrated its fourth consecutive quarter of production growth
• Operating loss of $2.1 million, mainly due to slowed operation at Santa Gertrudis High Grade Material ("HGM") project

GoGold produced 2,557 gold ounces and 151,442 silver ounces for a total of 339,730 silver equivalent ounces in the quarter ending June 30, 2017.

The Company's Parral project contributed 2,237 gold and 151,422 silver ounces for a total of 314,910 silver equivalent ounces, which is a 13% increase over the 278,230 silver equivalent ounces produced in the previous quarter.Parral production increased for the fourth consecutive quarter and management has implemented changes to mitigate any potential effects of the rainy season for the upcoming quarter, including the construction of an additional overflow pond to aide in diverting heavy rains. The Company expects to see a continued increase in production at Parral.

The Santa Gertrudis HGM project produced 320 ounces of gold (24,820 silver equivalent ounces) which was a decrease over Q2 2017 due to increased stripping of lower grade material required to access the high-grade ore which could be economically trucked to the off-site process plant. This resulted in lower production and increased costs for the quarter. Mining at HGM has been put on hold pending completion of a mine plan and evaluation of next steps.

Financial highlights for the nine months ending June 30, 2017:

• Revenue of $19.0 million from the sale of 1,137,897 silver equivalent ounces, a realized price of $16.69 per silver equivalent ounce
• Operating income of $1.9 million
• Cash cost per silver equivalent ounce of $10.42
• All in sustaining cost per silver equivalent ounce of $14.68
• Produced 1,166,048 silver equivalent ounces

All in sustaining costs per silver equivalent ounce increased from $9.59 in Q3 2016 to $25.91 in Q3 2017. Factors contributing to the increase are the higher stripping costs at the Santa Gertrudis project, as well as increased sustaining capital at Parral, where $2.1 million was spent primarily on heap leach pad expansions.

Liquidity Update
At June 30, 2017, the Company had a working capital deficit of $35.1 million. The Company was not in compliance with the financial covenants of its senior revolving credit facility ("Credit Facility"), and as a result $46.3 million of debt was classified as current and included in current liabilities.A waiver of these financial covenants was obtained subsequent to quarter end on August 11, 2017.As a result of the waiver, further drawdowns on the Credit Facility are currently restricted and the Company must maintain a minimum cash balance of $1 million. In the event that the Company is unable to obtain amendments or waivers from the lender in the future, the lender may demand repayment. If the lender demands repayment and management is unable to secure alternate sources of funding, the Company's liquidity position could be impacted.

Management is currently focused on increasing free cash flow at the Parral project and is actively exploring alternatives to de-lever its balance sheet. These alternatives may include seeking strategic investments, acquisitions and divestitures of or joint ventures on certain of the Company's assets. There can be no assurances that the Company will be successful in obtaining any of these alternate sources of funding.

This news release should be read in conjunction with the condensed consolidated interim financial statements, notes to the financial statements, and management's discussion and analysis for the quarter ended June 30, 2017, which have been filed on SEDAR and are available on the Company's website.

Technical information contained in this news release with respect to GoGold has been reviewed and approved by Mr. Bob Harris, P.Eng., who is a qualified person for the purposes of NI 43-101.

CAUTIONARY STATEMENT:
The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and may not be offered or sold within the United States or to, or for the benefit of, U.S. persons (as defined in Regulation S under the U.S. Securities Act) except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities laws or pursuant to exemptions therefrom. This release does not constitute an offer to sell or a solicitation of an offer to buy of any of GoGold's securities in the United States.

This news release may contain "forward-looking information" as defined in applicable Canadian securities legislation. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding the future plans and objectives of GoGold, constitute forward-looking information that involve various risks and uncertainties. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect, including, but not limited to, assumptions in connection with the continuance of GoGold and its subsidiaries as a going concern, general economic and market conditions, mineral prices, the accuracy of mineral resource estimates, and the ability to satisfy all conditions to funding of the second tranche under the credit agreement. There can be no assurance that such information will prove to be accurate and actual results and future events could differ materially from those anticipated in such forward-looking information.

Important factors that could cause actual results to differ materially from GoGold's expectations include exploration and development risks associated with the GoGold's projects, the failure to establish estimated mineral resources or mineral reserves, volatility of commodity prices, variations of recovery rates and global economic conditions. For additional information with respect to risk factors applicable to GoGold, reference should be made to GoGold's continuous disclosure materials filed from time to time with securities regulators, including, but not limited to, GoGold's Annual Information Form. The forward-looking information contained in this release is made as of the date of this release.

Cautionary non-IFRS Measures and Additional IFRS Measures
The Company believes that investors use certain non-IFRS and additional IFRS measures as indicators to assess mining companies. They are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared with IFRS. Non-IFRS and additional IFRS measures do not have a standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other companies.

Additional IFRS measures that are presented on the face of the Company's consolidated statements of comprehensive income include "Operating (loss) income". These measures are intended to provide an indication of the Company's mine and operating performance. "Cash flow from operating activities before changes in non-cash working capital" is a non-IFRS performance measure that could provide an indication of the Company's ability to generate cash flows from operations, and is calculated by adding back the change in non-cash working capital to "Net cash used in operating activities" as presented on the Company's consolidated statements of cash flows. Per ounce measures are calculated by dividing the relevant mining and processing costs and total costs by the ounces of metal sold in the period. "Cash costs per ounce" and "all-in sustaining costs per ounce" as used in this analysis are non-IFRS terms typically used by mining companies to assess the level of gross margin available to the Company by subtracting these costs from the unit price realized during the period. These non-IFRS terms are also used to assess the ability of a mining company to generate cash flow from operations. There may be some variation in the method of computation of these metrics as determined by the Company compared with other mining companies. In this context, "cash costs per ounce" reflects the cash operating costs allocated from in-process and dore inventory associated with ounces of silver and gold sold in the period. "Cash costs per ounce" may vary from one period to another due to operating efficiencies, grade of material processed and silver/gold recovery rates in the period. "All-in sustaining costs per ounce" include total cash costs, exploration, corporate and administrative, share based compensation and sustaining capital costs. For a reconciliation of non-IFRS and IFRS measures, please refer to the Management Discussion and Analysis dated August 14, 2017, for the quarter ended June 30, 2017, as presented on SEDAR.

SOURCEGoGold Resources Inc.

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