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Last updated on April 24, 2014 at 5:50 EDT

SAS reports positive 2013 first quarter results, beating cash cost guidance and generating net cash flow

May 9, 2013

All dollar amounts are stated in Canadian dollars, unless otherwise
indicated

(1) See “non-GAAP measures” for an explanation of non-GAAP

TORONTO, May 9, 2013 /CNW/ – St Andrew Goldfields Ltd. (T-SAS) (OTCQX-STADF), (“SAS” or the “Company“) earned net income attributable to shareholders for Q1 2013 of $1.0
million, or nil on a per share basis, compared to net income of $2.7
million, or $0.01 per share, for Q1 2012. For the Q1 of 2013, adjusted
net earnings ((1)) were $1.1 million, or nil on a per share basis, compared to adjusted
net earnings of $2.0 million, or $0.01 per share, for Q1 2012.

Net income for the quarter was negatively impacted by an increase in
non-cash depreciation and depletion expense of $3.9 million over Q1
2012, and $1.2 million mark-to-market loss in foreign currency
derivatives. Compared to Q1 2012, adjusted net earnings ((1) )for the quarter were also negatively impacted by the increase in
depreciation and depletion expenses.

Cash provided by operating activities for Q1 2013 was $14.1 million,
compared to $8.3 million in Q1 2012. Net cash flow ((1)) for the quarter was $4.1 million as compared to net cash out flows of
$1.0 million in Q1 2012.

“We are happy to report strong first quarter results and another
consecutive quarter of net cash flow generation,” said Jacques Perron,
President & CEO of SAS. “Our operating mines are performing well and
our production guidance for 2013 remains unchanged. The Company expects
to produce between 95,000 and 105,000 ounces from the three operations
with mine cash costs of between US$800-US$850 per ounce, before
royalties. In recent weeks, we have witnessed a significant decline in
the gold price to as low as US$1,378 per ounce. In light of the recent
gold price volatility, we have reviewed our capital expenditure
programs and deferred some expenditures in order to ensure we can meet
our near-term objectives while maintaining a strong financial
position.”

Q1 2013 Conference Call Information
A conference call and webcast is scheduled for 10:00am EDT, Friday, May
10, 2013 to discuss the Q1 2013 results. Participants are invited to
join via webcast from the Company’s website under the section titled
“Events”, at www.sasgoldmines.com. A recorded playback of the call will also be available via the website
and will be posted within 24 hours of the call.

Q1 2013 Highlights

     _____________________________________________________________________
    |Produced 24,461 ounces of gold    |An increase of 16% when compared  |
    |from three operations (Holt,      |to Q1 2012 as a result of the     |
    |Holloway and Hislop).             |increased production at Holt.     |
    |__________________________________|__________________________________|
    |Sold 23,009 ounces of gold at an  |Gold sales revenue increased by   |
    |average realized price per ounce  |11% from Q1 2012 despite a US$63  |
    |of gold sold (1) of US$1,632 per  |per ounce decrease in the average |
    |ounce for revenues of $38.2       |realized price per ounce of gold  |
    |million.                          |sold(1).                          |
    |__________________________________|__________________________________|
    |Mine cash costs of US$794 per     |Achieved an overall unit cost     |
    |ounce and a royalty cost of US$145|reduction of US$57 per ounce of   |
    |per ounce, for a total cash cost  |gold sold when compared to Q1     |
    |per ounce of gold sold (1) of     |2012. Mine cash cost per ounce of |
    |US$939 per ounce.                 |gold sold for Q1 2013 of US$794   |
    |                                  |per ounce is lower than the       |
    |                                  |Company's base 2013 cost guidance.|
    |__________________________________|__________________________________|
    |Earned cash margin from mine      |An 18% increase in cash margin    |
    |operations (1) of $16.4 million   |from mine operations (1) and an   |
    |and operating cash flow of $14.1  |improvement of 70% on operating   |
    |million or $0.04 per share.       |cash flowover Q1 2012.            |
    |__________________________________|__________________________________|
    |Invested $4.7 million in mine     |Mine capital expenditures reduced |
    |capital expenditures.             |by $3.3 million or 42% when       |
    |                                  |compared to Q1 2012.              |
    |__________________________________|__________________________________|
    |Incurred $4.0 million in          |During Q1 2013, SAS generated     |
    |exploration and project           |representative samples from the   |
    |development expenditures at the   |material that was extracted in    |
    |Taylor Project.                   |December, through a sampling      |
    |                                  |tower. These samples were assayed |
    |                                  |and further geological assessment |
    |                                  |and drilling was conducted in the |
    |                                  |bulk sample area to enhance       |
    |                                  |knowledge of the upper lens of the|
    |                                  |West Porphyry Zone. (see "Taylor  |
    |                                  |Project Update")                  |
    |__________________________________|__________________________________|

Summarized Operating and Financial Data


    Amounts in thousands of Canadian
    dollars, except per unit amounts             Q1 2013            Q1 2012

    SAS Operating Results                                                  

    Gold production (ounces)                      24,461             21,018

    Commercial gold production sold
    (ounces)                                      23,009             20,325

    Per ounce data (US$)                                                   

      Average realized price per
      ounce of gold sold (1)               $       1,632     $        1,695

      Mine cash costs                      $         794     $          858

      Royalty costs                                  145                138

      Total cash cost per ounce of
      gold sold (1)                        $         939     $          996

    SAS Financial Results                                                  

    Gold sales and total revenue           $      38,190     $       34,296

    Cash margin from mine operations
    (1)                                    $      16,409     $       13,923

    Net income for the period              $       1,039     $        2,734

    Adjusted net earnings (1)              $       1,070     $        2,034

    Cash from operations                   $      14,053     $        8,256

    Net cash flow (1)                      $       4,064     $        (511)

    Per share information:                                                 

      Net income                           $        0.00     $         0.01

      Adjusted net earnings (1)            $        0.00     $         0.01

      Operating cash flow (1)              $        0.04     $         0.02

                                               March 31,       December 31,
    SAS Financial Position                          2013               2012

    Cash and cash equivalents              $      32,103     $       30,656

    Working capital                        $      15,226     $       18,210

    Total assets                           $     223,807     $      219,748

    Long-term debt                         $      16,338     $       18,581

Financial Performance
Gold sales revenues for Q1 2013 increased by $3.9 million over Q1 2012
as a result of increased production from the Holt Mine, despite a US$63
per ounce decrease in the average realized price per ounce of gold sold
((1)). The increase in production for Q1 2013 resulted in a decrease in total
cash cost per ounce of gold sold ((1)) of US$57 per ounce when compared to Q1 2012. The increase in gold sales
during the quarter coupled with the decrease in unit cost has led to an
18% increase in cash margin from mine operations ((1)).

When compared to the previous quarter, commercial gold production sold
decreased by 12% or approximately 3,000 ounces which together with a
US$78 per ounce decrease in the average realized price per ounce of
gold sold ((1)), which led to a decrease in gold sales revenue of $6.1 million. The
decline in revenue together with a US$49 per ounce increase in mine
cash cost over the previous quarter, (as a result of the additional
heating requirements during the winter season), led to a decrease in
cash margin from mine operations ((1) )of $5.1 million.

Depreciation and depletion expenses for the quarter increased by $3.9
million and $1.2 million when compared to Q1 2012, and Q4 2012,
respectively. The increase resulted from the depletion of mineral
reserves and resources at the operations, and the loss of approximately
26,000 contained ounces in mineral reserves at Hislop as a result of
the updated mineral reserves and resource model and pit optimization
completed at year end 2012.

For Q1 2013, the Company incurred $1.2 million in mark-to-market loss on
foreign currency derivatives for the quarter due to the strengthening
of the US dollar relative to Canadian dollar, which negatively impacted
earnings.

Holt Mine, Operations and Financial Review (see “Operating and Financial Statistics Holt”)
During Q1 2013, the Holt Mine (“Holt”) produced 14,806 ounces of gold, a decrease of 2% over Q4 2012. As a
result of the slight decrease in production, gold sales also decreased
slightly over Q4 2012.

Total cash cost per ounce of gold sold ((1)) increased by US$44 per ounce or 6% over the previous quarter mainly due
to an 8% increase in mine cash costs, which is attributable to the
increase in heating costs for the mine due to the winter season.

The decrease in gold sales and a slight increase in operating costs lead
to a $2.7 million decrease in cash margin from mine operations ((1)) over Q4 2012. Holt contributed 72% of the total cash margin from mine
operations ((1)) earned during the quarter.

Holt is expected to contribute approximately 55% of the Company’s total
gold production for 2013.

Holloway Mine, Operations and Financial Review (see “Operating and Financial Statistics Holloway”)
The Holloway Mine (“Holloway”) produced 5,140 ounces of gold for Q1 2013, which is consistent with
the production level achieved in Q4 2012. For the quarter, ore grade
improved slightly while the mill recovery rate of approximately 92%
exceeded the Company’s forecast recovery due to improved mineralogical
conditions in the areas mined during the quarter. Development crews
continue to provide access for additional areas within the Smoke Deep
Zone (“Smoke Deep”) in order to sustain the production profile for the mine.

Gold sales revenues for the quarter were in line with the previous
quarter, despite a decrease in the average realized price per ounce of
gold sold ((1)).

Total cash cost per ounce of gold sold ((1) )during the quarter increased by US$131 per ounce when compared to the
previous quarter, mainly due to a 7% decrease in throughput and the
additional heating costs in the winter season. These factors, in
conjunction with a lower average realized price per ounce of gold sold ((1)), led to a $0.9 million decrease in cash margin from mine operations ((1)) over the previous quarter.

Holloway is expected to contribute approximately 25% of the Company’s
total gold production for 2013.

Hislop Mine, Operations and Financial Review (see “Operating and Financial Statistics Hislop”)
The Hislop Mine (“Hislop”) produced 4,515 ounces of gold during Q1 2013. The head grade averaged
2.14 g/t Au, with lower than expected mill recoveries of 82%, which was
affected by the challenging winter conditions.

Commercial gold production sold decreased by 31% or approximately 2,000
ounces for Q1 2013 compared to Q4 2012, due to the decrease in
throughput.

Total cash cost per ounce of gold sold ((1) )was 4% higher than the previous quarter as a result of the decrease in
throughput, and lower head grade and mill recoveries.

Hislop is expected to contribute approximately 20% of the Company’s
total gold production for 2012.

Taylor Project Update (“Taylor”)
A stepped approach was implemented in order to improve the quality of
information prior to allocating total capital expenditures for the
development activities at the West Porphyry Zone (“WPZ“). During 2012, SAS conducted ramp dewatering and rehabilitation, and
accessed the area at the top of the WPZ, near surface, in order to,
extract a 15,000 tonne bulk sample, test the proposed mining method,
and gather more information from an area that had limited information.

During Q1 2013, activities at Taylor included: the completion of the
tower sampling program and subsequent assaying of the generated
representative samples; a campaign of diamond drilling in the bulk
sample area (approximately 700 metres of drilling); an extensive
geological structural analysis by a leading expert in the field; a
comprehensive geochemical analysis performed by a reputable outside
third party; as well as the continuation of lateral development within
the ramp system.

Based on the results of the sampling program and the additional
structural and geochemical analysis, the Company has concluded that it
needs additional geological information to further improve the accuracy
of the geological model. In addition, in light of the revised capital
expenditure program for 2013, SAS has revised the program at Taylor to
include additional diamond drilling on the area identified for the
second bulk sample, to confirm its knowledge of the ore grade
distribution within the main lens of the WPZ. SAS has advanced ramp
development and commenced underground diamond drilling on this part of
the WPZ and will utilize this additional information in order to
optimize the future development and mining plan for Taylor. The
rescheduling of the main ramp infrastructure does not have a material
impact on net cash flow for 2014 and 2015.

Exploration Projects
Exploration activities during Q1 2013 remained focused on drilling at
Holloway and Hislop. Drilling to test the easterly strike and up-dip
and down-dip component at Smoke Deep returned encouraging results, and
identified a new zone, the Sediment Zone. Additional drilling on these
two zones is planned for Q2 2013 with one surface drill, and one
underground drill set up on the 550m Level drift, to follow up on
results released on March 4, 2013 (see press release available under
the Company’s profile on www.sedar.com or on the Company website at www.sasgoldmines.com).

Drilling on the Hislop Property, namely the Hislop North Project, also
returned encouraging results and is situated directly along strike from
the 147 and Grey Fox South mineralized trends. As well, drilling
beneath the West Pit at Hislop, returned significant grades and width,
with hole HP12-002 returning 94.56 g/t Au over 9.6 metres (uncut),
including 120.60 g/t Au over 7.5 metres (uncut) (see press release
dated March 4, 2013, available under the Company’s profile on www.sedar.com or on the Company website at www.sasgoldmines.com).

For the remainder of 2013, the exploration programs will continue to
concentrate on targets situated near the existing mining operations.
The priorities will include the Hislop North and Hislop Pit targets
located near Hislop, as well as the Smoke Deep and Sediment targets at
Holloway. There are currently three surface drills active with two
drills focused on the Hislop Property and one drill at Holloway.

Capital Resources
Working capital at the end of the quarter was $15.2 million compared to
working capital of $18.2 million in the previous quarter. SAS generated
cash flow from operations in Q1 2013 of $14.1 million, a decrease of
$7.7 million over Q4 2012, primarily as a result of the reduction in
gold sold for the quarter. This resulted in a decrease in cash margin
from mine operations((1)) of $5.1 million, coupled with a decrease in net change in working
capital of $2.5 million. At the end of Q1 2013, the Company had cash
and cash equivalents of $32.1 million. The Company also has access to
additional cash resources by way of an undrawn US$10.0 million
revolving credit facility.

The price of gold has declined significantly to a level that will impact
the Company’s cash flow and operating results. There is no certainty
that the price of gold will increase in the near term or return to
levels attained in FY 2012 and in Q1 2013. With this in mind, the
Company has revised its capital expenditure programs as well as
exploration and evaluation assets with the objective to maintain a
strong financial position.

Under SAS’ revised expenditure program, exploration programs for FY 2013
have been prioritized and expenditures were reduced by $1.5 million, a
reduction of 19% from the amount initially forecasted. The core
programs are to focus on near mine exploration with the objectives to
increase the mineral resource base at Holloway and Hislop. Mine
sustaining and development capital, in conjunction with the Taylor
advanced stage exploration program, have also been revised to
reschedule mid and long-term development programs and/or curtail
non-essential equipment procurement and infrastructure upgrades. As a
result, the Company’s forecast for the remainder of 2013 has been
reduced by $20.8 million, a reduction of 40% from the initial amount
planned.


    Amounts in                                                       Revised
    thousands                      Incurred         Deferred           2013
    of Canadian       2013            in            Capital          Forecast
    dollars         Forecast       Q1 2013        Expenditures          Q2
                                                                      2013 -
                                                                     Q4 2013

    Mine
    capital and
    Exploration
    and
    evaluation
    asset
    additions
    in Q1 2013

      Holt        $     22.0     $      3.4     $          5.8           12.8

      Holloway           7.0            0.9                2.0            4.1

      Holt Mill          1.4            0.4                  -            1.0

                  $     30.4     $      4.7     $          7.8     $     17.9

      Taylor      $     21.0     $      4.3     $         13.0     $      3.7

                        51.4            9.0               20.8           21.6

The Company believes that it is able to sustain operations at an average
gold price of US$1,300 per ounce without any significant reduction or
curtailment of its current operating plans. The Company continues to
monitor this risk and will revise its operating plans accordingly in
order to ensure its near-term and long-term cash flow objectives are
met.

Qualified Person
Production and ongoing development programs at the Holt, Holloway and
Hislop mines, and processing at the Holt Mill, as well as activities at
the Taylor Project are being conducted under the supervision of Duncan
Middlemiss, P.Eng, the Company’s COO and Vice-President of Operations.
The exploration programs on the Company’s various mineral properties
are under the supervision of Doug Cater, P.Geo, the Company’s
Vice-President, Exploration. Both Messrs. Middlemiss and Cater are
qualified persons as defined by National Instrument 43-101, and have
reviewed and approved this news release.

Non-GAAP Measures
The Company has included the following non GAAP performance measures:
adjusted net earnings; operating cash flow per share; net cash flow;
average realized price per ounce of gold sold; total cash cost per
ounce of gold sold; cash margin from mine operations; cash margin per
ounce of gold sold; and mine site cost per tonne milled throughout this
press release, which do not have standardized meanings prescribed by
International Financial Reporting Standards (“IFRS”) and are not necessarily comparable to other similarly titled measures
of other companies due to potential inconsistencies in the method of
calculation. The Company believes that, in addition to conventional
measures prepared in accordance with IFRS, the Company and certain
investors use this information to evaluate the Company’s performance.
Refer to pages the non-GAAP section of this news release for a
discussion and the reconciliation of these non-GAAP measurements to the
Company’s Unaudited Condensed Interim Financial Report for Q1 2013.

The Unaudited Balance Sheets, Statements of Operations and Statements of
Cash Flows for the Company for the three months ended March 31, 2013,
can be found at the end of this release.

To review the complete Unaudited Condensed Financial Report for Q1 2013,
and the Interim Management’s Discussion and Analysis for Q1 2013,
please see SAS’s SEDAR filings under the Company’s profile at www.sedar.com or the Company’s website at www.sasgoldmines.com.

The following abbreviations are used to describe the periods under
review throughout this release


    Abbreviation       Period              Abbreviation       Period

                       January 1,                             July 1, 2012
    FY 2013            2013 -              Q3 2012            - September
                       December 31,                           30, 2012
                       2013

                       October 1,                             April 1, 2012
    Q4 2013            2013 -              Q2 2012            - June 30,
                       December 31,                           2012
                       2013

                       July 1, 2013                           January 1,
    Q3 2013            - September         Q1 2012            2012 - March
                       30, 2013                               31, 2012

                       April 1, 2013                          October 1,
    Q2 2013            - June 30,          Q4 2011            2011 -
                       2013                                   December 31,
                                                              2011

                       January 1,                             July 1, 2011
    Q1 2013            2013 - March        Q3 2011            - September
                       31, 2013                               30, 2011

                       January 1,                             April 1, 2011
    FY 2012            2012 -              Q2 2011            - June 30,
                       December 31,                           2011
                       2012

                       October 1,
    Q4 2012            2012 -
                       December 31,
                       2012

About SAS
SAS (operating as “SAS Goldmines”), is a gold mining and exploration
company with an extensive land package in the Timmins mining district,
north-eastern Ontario, which lies within the Abitibi greenstone belt,
the most important host of historical gold production in Canada.

SAS owns and operates the Holt, Holloway and Hislop mines, which
contribute approximately 100,000 ounces of annual gold production. The
Company is also advancing the Taylor Project and is conducting
exploration across 120km of land straddling the Porcupine-Destor Fault
Zone.

FORWARD-LOOKING INFORMATION

This news release contains forward-looking information and
forward-looking statements (collectively, “forward-looking
information”) under applicable securities laws, concerning the
Company’s business, operations, financial performance, condition and
prospects, as well as management’s objectives, strategies, beliefs and
intentions. Forward-looking information is frequently identified by
such words as “may”, “will”, “plan”, “expect”, “estimate”,
“anticipate”, “believe”, “intend” and similar words referring to future
events and results, including in respect of the targeted gold
production levels at the Company’s three operating mines for 2013; the
revised advanced exploration program at Taylor, and the timing thereof;
and the level of capital expenditures required at the three operations,
development and exploration projects; the extent and objectives of the
Company’s exploration programs for the balance of 2013; the impact of
significant declines in the gold price; and the sufficiency of the
Company’s cash flow and existing cash resources to finance its capital
programs and the further development of its advanced stage exploration
projects.

This forward-looking information is subject to known and unknown risks,
uncertainties and other factors that may cause actual results to differ
materially from those expressed or implied by the forward-looking
information. Factors that may cause actual results to vary materially
include, but are not limited to, unanticipated operational or technical
difficulties which could increase the time necessary to complete the
development initiatives, escalate operating and/or capital costs and
reduce anticipated production levels; uncertainties relating to the
interpretation of the geology, continuity, grade and size estimates of
the mineral reserves and resources; the Company’s dependence on key
employees and changes in the availability of qualified personnel;
fluctuations in gold prices and exchange rates; operational hazards and
risks, including the inability to insure against all risks; changes in
laws and regulations; and changes in general economic conditions. Such
forward looking information is based on a number of assumptions,
including in respect of the ability to achieve operating cost
estimates, the level and volatility of the price of gold, the accuracy
of reserve and resource estimates and the assumptions on which such
estimates are based and general business and economic conditions.
Should one or more risks and uncertainties materialize or should any
assumptions prove incorrect, then actual results could vary materially
from those expressed or implied in the forward-looking information.
Accordingly, readers are cautioned not to place undue reliance on this
forward-looking information. SAS does not assume the obligation to
revise or update this forward-looking information after the date of
this release or to revise such information to reflect the occurrence of
future unanticipated events, except as may be required under applicable
securities laws. A further description of the risks and uncertainties
facing the Company may also be found in the Company’s Annual
Information Form available on SEDAR at www.sedar.com.

NON-GAAP MEASURES

Adjusted net earnings
Adjusted net earnings are calculated by removing the gains and losses,
resulting from the mark-to-market revaluation of the Company’s
gold-linked liabilities and foreign currency price protection
derivative contracts, one-time gains or losses on the disposition of
non-core assets, periodic adjustments to the Company’s asset retirement
obligations, and expenses, asset impairment gains or losses and
significant tax adjustments not related to current period’s earnings,
as detailed in the table below. Adjusted net earnings does not
constitute a measure recognized by IFRS and does not have a
standardized meaning defined by IFRS and may not be comparable to
information in other gold producers’ reports and filings. The Company
discloses this measure, which is based on its Financial Reports, to
assist in the understanding of the Company’s operating results and
financial position.


    Amounts in thousands of
    Canadian dollars, except           Q1 2013       Q4 2012       Q1 2012
    per share amounts

    Net income per Financial         $   1,039     $  12,632     $   2,734
    Reports

    Reversal of unrecognized           (1,256)       (8,312)             -
    deferred income tax assets

    Mark-to-market loss (gain)           (191)         (151)           822
    on gold-linked liabilities

    Mark-to-market loss (gain)
    on foreign currency                  1,240           333       (1,755)
    derivatives

    Loss on the divestiture of               -           272             -
    non-core assets

    Impairment loss on
    available-for-sale                     500           825             -
    investment

    Tax effect of above items            (262)         (114)           233

    Adjusted net earnings            $   1,070     $   5,485     $   2,034

    Weighted average number of
    shares outstanding (000s)

      Basic                            368,246       368,246       368,246

      Diluted                          368,801       368,691       368,782

    Adjusted net earnings per        $    0.00     $    0.01     $    0.01
    share - basic and diluted

Total cash cost per ounce of gold sold
Total cash cost per ounce of gold sold is a non-GAAP performance measure
and may not be comparable to information in other gold producers’
reports and filings. The Company has included this non-GAAP performance
measure throughout this document as the Company believes that this
generally accepted industry performance measure provides a useful
indication of the Company’s operational performance. The Company
believes that, in addition to conventional measures prepared in
accordance with IFRS, certain investors use this information to
evaluate the Company’s performance and ability to generate cash flow.
Accordingly, it is intended to provide additional information and
should not be considered in isolation or as a substitute for measures
of performance prepared in accordance with IFRS. The following table
provides a reconciliation of total cash costs per ounce of gold sold to
production expenses per the Financial Report for Q1 2013:


    Amounts in thousands of
    Canadian dollars, except            Q1 2013       Q4 2012       Q1 2012
    where indicated

    Mine site operating costs         $  18,411     $  19,242     $  17,451
    per Financial Reports

    Production royalties per              3,370         3,590         2,922
    Financial Reports

    Adjustments (1)                           -             -          (99)

    Total cash costs                  $  21,781     $  22,832     $  20,274

    Divided by gold ounces sold          23,009        26,050        20,325

    Total cash cost per ounce
    of gold sold (Canadian            $     947     $     876     $     996
    dollars)

    Average USD:CAD exchange          $    1.01     $    0.99     $    1.00
    rate

    Total cash cost per ounce         $     939     $     884     $     996
    of gold sold (US$)

    Breakdown of total cash
    cost per ounce of gold sold
    (US$)

    Holt Mine                                                              

      Mine cash costs                 $     619     $     573     $     670

      Royalty costs                         166           168           168

                                      $     785     $     741     $     838

    Holloway Mine                                                          

      Mine cash costs                 $     977     $     834     $     948

      Royalty costs                         209           221           209

                                      $   1,186     $   1,055     $   1,157

    Hislop Mine                                                            

      Mine cash costs                 $   1,139     $   1,100     $   1,185

      Royalty costs                           -             -             -

                                      $   1,139     $   1,100     $   1,185

    Total                                                                  

      Mine cash costs                 $     794     $     745     $     858

      Royalty costs                         145           139           138

                                      $     939     $     884     $     996

    Notes:

    (1)     In Q1 2012, the Company accrued a royalty liability of $99 at
            Holloway which was incurred during the period
            from August 2011 to December 2011. This amount has been
            retroactively applied to the calculation of the
            total cash cost per ounce of gold sold for each of these
            quarters, respectively.

Mine-site cost per tonne milled
Mine-site cost per tonne milled is a non-GAAP performance measure and
may not be comparable to information in other gold producers’ reports
and filings. As illustrated in the table below, this measure is
calculated by adjusting Production Costs, as shown in the statements of
operations for inventory level changes and then dividing by tonnes
processed through the mill. Since total cash cost per ounce of gold
sold data can be affected by fluctuations in foreign currency exchange
rates, Management believes that mine-site cost per tonne milled
provides additional information regarding the performance of mining
operations and allows Management to monitor operating costs on a more
consistent basis as the per tonne milled measure eliminates the cost
variability associated with varying production levels. Management also
uses this measure to determine the economic viability of mining blocks.
As each mining block is evaluated based on the net realizable value of
each tonne mined, the estimated revenue on a per tonne basis must be in
excess of the mine-site cost per tonne milled in order to be
economically viable. Management is aware that this per tonne milled
measure is impacted by fluctuations in throughput and thus uses this
evaluation tool in conjunction with production costs prepared in
accordance with IFRS. This measure supplements production cost
information prepared in accordance with IFRS and allows investors to
distinguish between changes in production costs resulting from changes
in production versus changes in operating performance.


    Amounts in thousands of
    Canadian dollars, except
    per tonne amounts                 Q1 2013       Q4 2012       Q1 2012

    Holt Mine                                                            

    Mine-site costs                 $   8,563     $   8,546     $   7,163

    Inventory adjustments (1)           1,017         (230)           611

    Mine site operating costs       $   9,580     $   8,316     $   7,774

    Divided by tonnes of ore
    milled                             89,985        89,901        67,937

    Mine-site cost per tonne
    milled                          $     106     $      93     $     114

    Holloway Mine                                                        

    Mine-site costs                 $   5,059     $   4,119     $   4,659

    Inventory adjustments (1)             320           277           281

    Mine site operating costs       $   5,379     $   4,396     $   4,940

    Divided by tonnes of ore
    milled                             43,252        46,606        47,151

    Mine-site cost per tonne
    milled                          $     124     $      94     $     105

    Hislop Mine                                                          

    Mine-site costs                 $   4,788     $   6,577     $   5,629

    Inventory adjustments (1)             537         (391)           167

    Mine site operating costs       $   5,325     $   6,186     $   5,796

    Divided by tonnes of ore
    milled                             79,771        95,516        94,660

    Mine-site cost per tonne
    milled                          $      67     $      65     $      61

    Notes:

    (1)      Inventory adjustment reflects production costs associated with
             unsold bullion and in-circuit inventory.

Cash margin from mine operations
Cash margin from mine operations is a non-GAAP measure which may not be
comparable to information in other gold producers’ reports and filings.
It is calculated as the difference between gold sales and production
costs (comprised of mine-site operating costs and production royalties)
per the Company’s Financial Reports. The Company believes it
illustrates the performance of the Company’s operating mines and
enables investors to better understand the Company’s performance in
comparison to other gold producers who present results on a similar
basis.


    Amounts in
    thousands                           Q1 2013       Q4 2012       Q1 2012
    of Canadian
    dollars

    Gold sales            [A]
    per                               $  38,190     $  44,332     $  34,296
    Financial
    Reports

    Mine site
    operating
    costs per                            18,411        19,242        17,451
    Financial
    Reports

    Production
    royalties
    per                                   3,370         3,590         2,922
    Financial
    Reports

                          [B]            21,781        22,832        20,373

    Cash margin       [A] - [B]
    from mine                         $  16,409     $  21,500     $  13,923
    operations

    Breakdown
    of cash
    margin from
    mine
    operations
    by mines:

      Holt Mine                       $  11,887     $  14,538     $   9,054

      Holloway                            2,391         3,262         2,492
      Mine

      Hislop                              2,131         3,700         2,377
      Mine

                                      $  16,409     $  21,500     $  13,923

Average realized price per ounce of gold sold
Average realized price per ounce of gold sold is a non-GAAP measure and
is calculated by dividing gold sales as reported in the Company’s
Financial Reports by the gold ounces sold. It may not be comparable to
information in other gold producers’ reports and filings.

Cash margin per ounce of gold sold
Cash margin per ounce of gold sold is a non-GAAP measure, and is
calculated by subtracting the total cash cost per ounce of gold sold
from the average realized price per ounce of gold sold.


    Amounts in
    United
    Sates
    dollars

                                        Q1 2013       Q4 2012       Q1 2012

    Per ounce
    of gold
    sold:

      Average
      realized
      price per           [A]         $   1,632     $   1,710     $   1,695
      ounce of
      gold sold

      Total
      cash cost
      per ounce           [B]         $     939     $     884     $     996
      of gold
      sold

    Cash margin
    per ounce         [A] - [B]       $     693     $     826     $     699
    of gold
    sold

Net cash flow
Net cash flow is a non-GAAP measure and is calculated by taking cash
flow from operating activities less cash used in investing activities
as reported in the Company’s Financial Reports. It may not be
comparable to information in other gold producers’ reports and filings.


    Amounts in thousands of            Q1 2013       Q4 2012       Q1 2012
    Canadian dollars

    Cash flow from operating
    activities per Financial         $  14,053     $  21,737     $   8,256
    Reports

    Less:                                                                 

      Cash used in investing
      activities per Financial           9,989        11,282         8,767
      Reports

                                     $   4,064     $  10,455     $   (511)

Operating cash flow per share
Operating cash flow per share is a non-GAAP measure and is calculated by
dividing cash flow from operating activities in the Company’s Financial
Reports by the weighted average number of shares outstanding for each
period. It may not be comparable to information in other gold
producers’ reports and filings.


    Amounts in thousands of
    Canadian dollars, except           Q1 2013       Q4 2012       Q1 2012
    per share amounts

    Cash flow from operating
    activities per Financial         $  14,053     $  21,737     $   8,256
    Reports

    Weighted average number of         368,246       368,246       368,246
    shares outstanding (000s)

    Operating cash flow per          $    0.04     $    0.06     $    0.02
    share

Operating and Financial Statistics – Holt Mine


    Amounts in
    thousands of
    Canadian
    dollars,
    except where             Q1           Q4           Q3           Q2           Q1           Q4           Q3           Q2
    indicated              2013         2012         2012         2012         2012         2011         2011         2011

    Tonnes milled        89,985       89,901       80,219       78,429       67,937       67,778       66,556       54,538

    Head grade
    (g/t Au)               5.40         5.51         5.40         4.71         5.36         5.57         5.01         3.39

    Average mill
    recovery              94.8%        94.7%        94.4%        94.2%        94.1%        94.1%        93.4%        92.5%

    Gold produced
    (ounces)             14,806       15,082       13,145       11,193       11,025       11,421       10,012        5,508

    Commercial
    gold
    production
    sold (ounces)
    (1)                  13,715       15,043       12,373       11,073       10,674       12,175        8,870        4,979

    Gold sales
    revenue  (1)       $ 22,750     $ 25,584     $ 20,000     $ 18,250     $ 18,015     $ 21,060     $ 15,449     $  7,284

    Cash margin
    from mine
    operations (2)     $ 11,887     $ 14,538     $  9,250     $  8,886     $  9,054     $ 12,054     $  6,625     $    582

    Mine-site cost
    per tonne
    milled (2)         $    106     $     93     $    112     $     96     $    114     $     95     $    106     $    121

    Total cash
    cost per ounce
    of gold sold
    (US dollars)
    (2):                                                                                                                  

      Mine cash
      costs            $    619     $    573     $    708     $    671     $    670     $    556     $    833     $  1,255

      Royalty
      costs                 166          168          165          166          168          166          181          136

    Total cash
    cost per ounce
    of gold sold
    (2)                     785          741          873          837          838          722        1,014        1,391

      Depreciation
      and
      depletion             196          200          186          161          145          129          134          130

    Total
    production
    cost per ounce
    of gold sold
    (US dollars)       $    981     $    941     $  1,059     $    998     $    983     $    851     $  1,148     $  1,521

    Average
    USD:CAD
    exchange rate          1.01         0.99         0.99         1.01         1.00         1.02         0.98         0.97

    Capital
    expenditures       $  3,383     $  4,536     $  4,990     $  5,036     $  3,177     $  4,250     $  1,841     $  1,963

    Notes:

    (1)     Holt commenced commercial production on April 1, 2011. The
            operating results for the mine prior to April 1, 2011, were
            classified as site maintenance and pre-production
            expenditures.    

    (2)     Total cash cost per ounce of gold sold, mine-site cost per
            tonne milled and cash margin from mine operations are non-GAAP
            measures and are not necessarily comparable
            to similarly titled measures of other companies due to
            potential inconsistencies in the method of calculation (see
            pages 9-12 for an explanation of non-GAAP measurements).

Operating and Financial Statistics – Holloway Mine


    Amounts in
    thousands of
    Canadian
    dollars,
    except where             Q1           Q4           Q3           Q2           Q1           Q4           Q3           Q2
    indicated              2013         2012         2012         2012         2012         2011         2011         2011

    Tonnes milled        43,252       46,606       44,546       53,169       47,151       56,225       49,437       47,971

    Head grade
    (g/t Au)               4.04         3.90         4.15         3.80         3.77         4.03         3.71         3.43

    Average mill
    recovery              91.5%        89.7%        91.0%        91.2%        88.6%        84.1%        85.2%        85.0%

    Gold produced
    (ounces)              5,140        5,240        5,408        5,923        5,058        6,126        5,026        4,497

    Commercial
    gold
    production
    sold (ounces)
    (1)                   5,126        4,981        5,749        5,744        4,907        6,208        5,130        4,996

    Gold sales                                                $
    revenue            $  8,521     $  8,473     $  9,267        9,467     $  8,275     $ 10,750     $  8,828     $  7,272

    Cash margin
    from mine                                                 $
    operations (2)     $  2,391     $  3,262     $  3,835        3,805     $  2,492     $  4,116     $  2,931     $  1,822

    Mine-site cost
    per tonne                                                 $
    milled (2)         $    124     $     94     $     92           82     $    105     $     93     $     98     $     90

    Total cash
    cost per ounce
    of gold sold
    (US dollars)
    (2):                                                                                                                  

      Mine cash                                               $
      costs            $    977     $    834     $    746          771     $    948     $    853     $    960     $    964

      Royalty
      costs (3)             209          221          204          205          209          203          218          164

    Total cash
    cost per ounce
    of gold sold
    (2)                   1,186        1,055          950          976        1,157        1,056        1,178        1,128

      Depreciation
      and
      depletion             415          399          410          376          368          368          540          462

    Total
    production
    cost per ounce                                            $
    of gold sold
    (US dollars)       $  1,601     $  1,454     $  1,360        1,352     $  1,525     $  1,424     $  1,718     $  1,590

    Average
    USD:CAD
    exchange rate          1.01         0.99         0.99         1.01         1.00         1.02         0.98         0.97

    Capital                                                   $
    expenditures       $    912     $  1,443     $  1,794        2,539     $  4,342     $  3,666     $  2,938     $  2,986

    Notes:

    (1)     Holloway commenced production in October 2009.

    (2)     Total cash cost per ounce of gold sold, mine-site cost per
            tonne milled and cash margin from mine operations, are non-GAAP
            measures and are not necessarily comparable
            to similarly titled measures of other companies due to
            potential inconsistencies in the method of calculation (see
            pages 9-12 hereof for a reconciliation of non-GAAP
            measurements).

    (3)     In Q1 2012, the Company accrued a royalty liability of $99 at
            Holloway, which was incurred during the period from August 2011
            to December 2011.  This amount has been
            retroactively applied to the calculation of the total cash cost
            per ounce of gold sold for each of these quarters,
            respectively.

Operating and Financial Statistics – Hislop Mine


    Amounts in
    thousands of
    Canadian dollars,
    except where
    indicated                 Q1 2013       Q4 2012        Q3 2012       Q2 2012       Q1 2012       Q4 2011       Q3 2011         Q2 2011

    Overburden stripped
    (m3)                            -             -       (32,205)        29,236         4,212       103,346       300,249         472,214

    Tonnes (ore)
    mined                      82,361       101,617         99,287        76,764       118,918       107,827       109,457         114,849

           (waste)            267,906       453,629        513,988       536,015       680,221       599,330       738,054       1,303,072

                              350,267       555,246        613,275       612,779       799,139       707,157       847,511       1,417,921

    Waste-to-Ore Ratio            3.3           4.5            5.2           7.0           5.7           5.6           6.7            11.3

    Tonnes milled              79,771        95,516        102,191        97,183        94,660        92,794       107,741         120,677

    Head grade (g/t Au)          2.14          2.22           2.53          2.21          1.88          1.94          1.68            1.53

    Average mill
    recovery                    82.1%         80.8%          86.5%         85.6%         86.4%         83.0%         85.4%           87.2%

    Gold produced
    (ounces)                    4,515         5,507          7,189         5,899         4,935         4,803         4,980           5,192

    Commercial gold
    production sold
    (ounces) (1)                4,168         6,026          7,075         5,678         4,744         4,985         5,260           5,185

    Gold sales revenue      $   6,919     $  10,275     $   11,423     $   9,356     $   8,006     $   8,625     $   9,068     $     7,579

    Cash margin from
    mine operations (2)     $   2,131     $   3,700     $    5,165     $   3,505     $   2,377     $   2,528     $   2,432     $     1,000

    Mine-site cost per
    tonne milled (2)        $      67     $      65     $       62     $      61     $      61     $      60     $      59     $        55

    Total cash cost per
    ounce of gold sold
    (2)(3)                  $   1,139     $   1,100     $      889     $   1,020     $   1,185     $   1,196     $   1,286     $     1,311

           Depreciation
           and
           depletion              767           332            234           238           186           177           150             104

    Total production
    cost per ounce of
    gold sold (US
    dollars)                $   1,906     $   1,432     $    1,123     $   1,258     $   1,371     $   1,373     $   1,436     $     1,415

    Average USD:CAD
    exchange rate                1.01          0.99           0.99          1.01          1.00          1.02          0.98            0.97

    Capital
    expenditures            $       -     $    (39)     $      390     $     970     $     463     $     701     $   2,822     $     5,244

    Notes:

    (1)      Hislop commenced commercial production on July 1, 2010.

    (2)      Total cash cost per ounce of gold sold, mine-site cost per
             tonne milled and cash margin from mine operations are non-GAAP
             measures and are not necessarily comparable
             to similarly titled measures of other companies due to
             potential inconsistencies in the method of calculation (see
             pages 9-12 hereof for reconciliation of non-GAAP
             measurements).

    (3)      Hislop is subject to a 4% net smelter return royalty ("NSR")
             which includes a minimum Advance royalty payment obligation
             (see "Gold-linked Liabilities").

Statements of Operations (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars except per share information


                                              Three months ended March 31,

                                                   2013               2012

    Gold sales                                $  38,190     $       34,296

    Operating costs and expenses:                                         

      Mine site operating                        18,411             17,451

      Production royalty                          3,370              2,922

      Site maintenance and                          121                148
      pre-production

      Exploration                                 2,511              1,816

      Corporate administration                    2,265              2,090

      Depreciation and depletion                  8,284              4,406

                                                 34,962             28,833

    Operating income                              3,228              5,463

    Finance costs                                 (504)              (969)

    Mark-to-market gain (loss) on                   191              (822)
    gold-linked liabilities

    Mark-to-market gain (loss) on               (1,240)              1,755
    foreign currency derivatives

    Foreign exchange loss                           (4)              (258)

    Impairment loss on                            (500)                  -
    available-for-sale investments

    Finance income and other                         77                 38

    Income before taxes                           1,248              5,207

    Deferred taxes                                (209)            (2,473)

    Net income for the period                 $   1,039     $        2,734

    Other comprehensive income                                            

    Unrealized loss on
    available-for-sale investments, net            (95)              (266)
    of tax of nil for all periods

    Impairment loss on                              500                  -
    available-for-sale investments

    Mark-to-market loss on foreign
    currency and gold derivatives (net
    of tax
    of $154 in 2013, 2012, nil)                   (463)                  -

                                                   (58)              (266)

    Comprehensive income for the period       $     981     $        2,468

    Basic and diluted income per share        $    0.00     $         0.01
    attributable to shareholders

    Weighted average number of shares
    outstanding (000's)

    Basic                                       368,246            368,246

    Diluted                                     368,801            368,782

Statements of Cash Flows (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars


                                               Three months ended March 31,

                                                    2013               2012

    Cash provided by (used in):                                 

    Operating activities:                                       

      Net Income for the period                $   1,039     $        2,734

      Items not affecting cash:                                            

        Deferred taxes                               209              2,473

        Mark-to-market loss (gain) on              (191)                822
        gold-linked liabilities

        Implicit interest and
        amortization of transaction                  215                815
        costs

        Mark-to-market loss (gain) on              1,240            (1,755)
        foreign currency derivatives

        Depreciation and depletion                 8,284              4,406

        Impairment loss on                           500                  -
        available-for-sale investments

        Share-based payments                         323                189

        Accretion of asset retirement                151                138
        obligation

        Change in non-cash operating               2,409            (1,566)
        working capital and other

        Interest paid                              (126)                  -

                                                  14,053              8,256

    Investing activities:                                       

        Additions to exploration and             (4,010)               (44)
        evaluation assets

        Mine development expenditures            (2,987)            (6,492)

        Additions to plant and equipment         (2,233)            (1,634)

        Amounts payable on capital                 (416)              (638)
        additions

        Net change in cash
        collateralized for banking                     -                 58
        facilities

        Reclamation costs and other                (343)               (17)

                                                 (9,989)            (8,767)

    Financing activities:                                       

        Repayment of term credit                 (2,032)                  -
        facility

        Advance royalty payments                   (508)              (504)

        Capital lease payments                      (77)               (11)

        Repayment of Gold Notes                        -            (3,673)

                                                 (2,617)            (4,188)

    Increase (decrease) in cash and cash           1,447            (4,699)
    equivalents for the period

    Cash and cash equivalents, beginning          30,656             17,617
    of period

    Cash and cash equivalents, end of          $  32,103     $       12,918
    period

Balance Sheets (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars


                                     March 31, 2013       December 31, 2012

    Assets                                                                 

    Current assets:                                                        

      Cash and cash                $         32,103     $            30,656
      equivalents

      Accounts receivable                     1,652                   4,475

      Inventories                            10,406                   8,568

      Derivative assets                          62                     725

      Prepayments and other                     424                     237
      assets

                                             44,647                  44,661

    Exploration and                          35,369                  31,382
    evaluation assets

    Producing properties                     61,355                  64,363

    Plant and equipment                      52,917                  50,537

    Reclamation deposits                      8,323                   8,307

    Restricted cash                           1,695                   1,695

    Deferred tax assets                      18,832                  18,064

    Investment in joint                         374                     374
    venture

    Other assets                                295                     365

                                   $        223,807     $           219,748

    Liabilities and
    Shareholders' Equity

    Current liabilities:                                                   

      Accounts payable and         $         15,468     $            15,296
      other liabilities

      Employee-related                        5,334                   4,613
      liabilities

      Provisions                                777                     669

      Derivative liabilities                  1,194                       -

      Current portion of                      5,894                   5,822
      long-term debt

      Current portion of
      capital lease                             754                      51
      obligations 

                                             29,421                  26,451

    Long-term debt                           10,444                  12,759

    Capital lease                             1,589                     137
    obligations

    Asset retirement                         11,568                  11,743
    obligations

    Deferred tax liabilities                  1,578                     721

                                             54,600                  51,811

    Shareholders' equity:                                                  

      Share capital                          98,556                  98,556

      Contributed surplus                    20,138                  19,892

      Stock options                           3,753                   3,676

      Retained earnings                      46,801                  45,796

      Accumulated other
      comprehensive income                     (41)                      17
      (loss)

                                            169,207                 167,937

                                   $        223,807     $           219,748

SOURCE St Andrew Goldfields Ltd.


Source: PR Newswire