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Gold Resource Corporation Reports First Quarter Net Income of $5.1 Million, or $0.09 per Share; Maintains 2015 Production Outlook

COLORADO SPRINGS, CO--(Marketwired - May 8, 2015) - Gold Resource Corporation (NYSE MKT: GORO) (the "Company") reported production results for the first quarter ended March 31, 2015 of 19,347 ounces precious metal gold equivalent (AuEq) (calculated at actual sales price ratio of 72:1), which generated $5.1 million in net income for the quarter. Gold Resource Corporation is a gold and silver producer with operations in Oaxaca, Mexico and exploration in Nevada, USA. The Company has returned over $103 million to shareholders in monthly dividends since commercial production commenced July 1, 2010, and offers shareholders the option to convert their cash dividends and take delivery in physical gold and silver.

2015 Q1 HIGHLIGHTS

  • 19,347 ounces AuEq mill production

  • 18,800 ounces AuEq sold

  • $28.4 million sales, net

  • $5.1 million net income, or $0.09 per share

  • $416 total cash cost per ounce AuEq (after by-product credits)

  • $15.8 million Cash Flow from Mine Site Operations

  • $7.6 million by-product credits, or $402 per ounce AuEq sold

  • $1.6 million dividend distributions, or $0.03 per share for quarter

Overview of Q1 2015 Aguila Project Results

Gold Resource Corporation's Aguila Project produced 19,347 ounces AuEq at a total cash cost of $416 per ounce. Realized average metal price sales during the quarter were $1,203 per ounce gold and $16.74 per ounce silver. The Company recorded net income of $5.1 million, or $0.09 per share. Cash Flow from Mine Site Operations totaled $15.8 million. The Company paid $1.6 million to shareholders in dividends, or $0.03 per share during the quarter. Cash and cash equivalents at quarter end totaled $21.4 million. Realized gold and silver prices decreased 7.2% and 17.5%, respectively, compared to the first quarter of 2014.

"The Company delivered solid results for the first quarter of 2015," stated Gold Resource Corporation's CEO and President, Mr. Jason Reid. "Even with precious metal prices down significantly year over year, operations generated net income of $5.1 million, or $0.09 per share for the quarter. The Company is still focused on cost cutting measures and the benefit of these is evident as total cash cost per ounce AuEq was $416 for the quarter. The Company remains on track to meet its annual production outlook of 80,000 to 90,000 ounces of precious metal gold equivalent at a 64.1 to 1 ratio."

The following table summarizes certain information about our mining operations for the three months ended March 31, 2015 and 2014:

Production and Sales Statistics - Arista Underground Mine

Three months ended
March 31,

2015

2014

Milled

Tonnes Milled

92,359

104,349

Tonnes Milled per Day

1,026

1,159

Grade

Average Gold Grade (g/t)

3.13

3.25

Average Silver Grade (g/t)

287

285

Average Copper Grade (%)

0.42

0.35

Average Lead Grade (%)

1.46

1.23

Average Zinc Grade (%)

3.71

3.43

Recoveries

Average Gold Recovery (%)

90

91

Average Silver Recovery (%)

93

92

Average Copper Recovery (%)

76

80

Average Lead Recovery (%)

75

72

Average Zinc Recovery (%)

81

82

Mill production (before payable metal deductions)(1)

Gold (ozs.)

8,348

9,958

Silver (ozs.)

790,300

878,958

Copper (tonnes)

293

292

Lead (tonnes)

1,013

929

Zinc (tonnes)

2,762

2,920

Payable metal sold

Gold (ozs.)

8,678

8,586

Silver (ozs.)

727,315

766,535

Copper (tonnes)

277

259

Lead (tonnes)

920

812

Zinc (tonnes)

2,205

2,158

Average metal prices realized (2)

Gold ($ per oz.)

$

1,203

$

1,296

Silver ($ per oz.)

$

16.74

$

20.30

Copper ($ per tonne)

$

5,532

$

6,939

Lead ($ per tonne)

$

1,731

$

2,091

Zinc ($ per tonne)

$

2,008

$

2,050

Precious metal gold equivalent ounces produced (mill production) (1)(3)(4)

Gold Ounces

8,348

9,958

Gold Equivalent Ounces from Silver

10,999

13,776

Total Precious Metal Gold Equivalent Ounces

19,347

23,734

Precious metal gold equivalent ounces sold (3)(4)

Gold Ounces

8,678

8,586

Gold Equivalent Ounces from Silver

10,122

12,014

Total Precious Metal Gold Equivalent Ounces

18,800

20,600

Total cash cost (before by-product credits) per precious metal gold equivalent ounce sold (including royalties) (4)

$

818

$

806

Total cash costs, after by-product credits, per precious metal gold equivalent ounce sold (including royalties) (4)

$

416

$

422

(1)

Mill production represents metal contained in concentrates produced at the mill, which is before payable metal deductions are levied by the buyer of our concentrates. Payable metal deduction quantities are defined in our contracts with the buyer of our concentrates and represent an estimate of metal contained in the concentrates produced at our mill which the buyer cannot recover through the smelting process. There are inherent limitations and differences in the sampling method and assaying of estimated metal contained in concentrates that are shipped, and those contained metal estimates are derived from sampling methods and assaying throughout the mill production process. The Company monitors these differences to ensure that precious metal mill production quantities are materially correct.

(2)

Average metal prices realized vary from the market metal prices due to final settlement adjustments from our provisional invoices when they are settled. Our average metal prices realized will therefore differ from the market average metal prices in most cases.

(3)

Precious metal gold equivalent mill production for the three months ended March 31, 2015 of 19,347 ounces differs from gold equivalent ounces sold for the same period of 18,880 due principally to buyer (smelter) concentrate processing and other deductions of approximately 1,487 gold equivalent ounces and a decrease in gold equivalent ounces contained in ending inventory of approximately 941 ounces.

(4)

Non-GAAP measure to total mine cost of sales reconciliation, which is the most comparable United States generally accepted accounting principles ("U.S. GAAP") measure.

About GRC:

Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital. The Company has 100% interest in six potential high-grade gold and silver properties at its producing Oaxaca, Mexico Mining Unit and exploration properties at its Nevada, USA, Mining Unit. The Company has 54,179,369 shares outstanding, no warrants and no debt. Gold Resource Corporation offers shareholders the option to convert their cash dividends into physical gold and silver and take delivery. For more information, please visit GRC's website, located at www.Goldresourcecorp.com and read the Company's 10-K for an understanding of the risk factors involved.

Cautionary Statements:

This press release contains forward-looking statements that involve risks and uncertainties. The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this press release, the words "plan", "target", "anticipate," "believe," "estimate," "intend" and "expect" and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding Gold Resource Corporation's strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material. All forward-looking statements in this press release are based upon information available to Gold Resource Corporation on the date of this press release, and the company assumes no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. The Company's actual results could differ materially from those discussed in this press release. In particular, there can be no assurance that production will continue at any specific rate. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Company's 10-K filed with the SEC.

See Accompanying Tables

The following information summarizes the results of operations for Gold Resource Corporation for the three months ended March 31, 2015 and 2014, its financial condition at March 31, 2015 and December 31, 2014 and its cash flows for the three months ended March 31, 2015 and 2014. The summary data for the three months ended March 31, 2015 is unaudited; the summary data for the year ended December 31, 2014 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2014, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company's Form 10-K in its entirety, which can be found on the SEC's website at www.sec.gov.

The calculation of our cash cost per ounce contained in this press release is a non-GAAP financial measure. Please see "Management's Discussion and Analysis and Results of Operation" contained in the Company's most recent Form 10-Q and Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except share and per share amounts)

March 31,

December 31,

2015

2014

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

21,444

$

27,541

Gold and silver bullion

3,440

3,447

Accounts receivable

7,459

1,416

Inventories

8,019

7,295

IVA taxes receivable

661

575

Deferred tax assets

3,891

3,891

Prepaid expenses and other current assets

2,308

2,935

Total current assets

47,222

47,100

Property, plant and mine development, net

36,885

32,348

Deferred tax assets

25,519

25,519

Investments

1,901

2,620

Other non-current assets

4,725

4,078

Total assets

$

116,252

$

111,665

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable

$

6,306

$

3,892

Accrued expenses and other current liabilities

3,694

3,923

Capital lease obligations, current portion

1,543

1,498

Income taxes payable

6,342

7,907

Dividends payable

542

542

Total current liabilities

18,427

17,762

Capital lease obligations

415

834

Deferred tax liability

6

-

Reclamation and remediation liabilities

2,834

2,993

Total liabilities

21,682

21,589

Shareholders' equity:

Preferred stock - $0.001 par value, 5,000,000 shares authorized:

no shares issued and outstanding

-

-

Common stock - $0.001 par value, 100,000,000 shares authorized:

54,515,767 and 54,515,767 shares issued and outstanding, respectively

55

55

Additional paid-in capital

94,159

93,094

Retained earnings

7,411

3,982

Treasury stock at cost, 336,398 shares

(5,884

)

(5,884

)

Accumulated other comprehensive loss

(1,171

)

(1,171

)

Total shareholders' equity

94,570

90,076

Total liabilities and shareholders' equity

$

116,252

$

111,665

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

for the three months ended March 31, 2015 and 2014

(U.S. dollars in thousands, except share and per share amounts)

(Unaudited)

2015

2014

Sales, net

$

28,372

$

31,152

Mine cost of sales:

Production costs

12,934

14,221

Depreciation and amortization

1,392

745

Reclamation and remediation

23

-

Total mine cost of sales

14,349

14,966

Mine gross profit

14,023

16,186

Costs and expenses:

General and administrative expenses

2,731

3,013

Exploration expenses

1,712

1,288

Total costs and expenses

4,443

4,301

Operating income

9,580

11,885

Other (expense) income, net

(504

)

469

Income before income taxes

9,076

12,354

Provision for income taxes

4,023

5,229

Net income

$

5,053

$

7,125

Net income per common share:

Basic

$

0.09

$

0.13

Diluted

$

0.09

$

0.13

Weighted average shares outstanding:

Basic

54,179,369

53,934,925

Diluted

54,179,369

54,697,710

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

for the three months ended March 31, 2015 and 2014

(U.S. dollars in thousands)

(Unaudited)

2015

2014

Cash flows from operating activities:

Net income

$

5,053

$

7,125

Adjustments to reconcile net income to net cash from operating activities:

Depreciation, depletion and amortization

1,457

810

Stock-based compensation

1,066

783

Deferred income taxes

6

-

Currency exchange (gain) loss

(545

)

137

Unrealized loss (gain) on investments

719

(702

)

Other operating adjustments

112

-

Changes in operating assets and liabilities:

Accounts receivable

(6,043

)

(4,176

)

Inventories

(724

)

496

Prepaid expenses and other current assets

(24

)

1,110

Accounts payable and other accrued liabilities

1,046

1,551

Income taxes payable/receivable

(1,255

)

5,219

Total adjustments

(4,185

)

5,228

Net cash provided by operating activities

868

12,353

Cash flows from investing activities:

Capital expenditures

(4,937

)

(4,190

)

Proceeds from conversion of gold and silver bullion

7

8

Investments

-

(1,805

)

Net cash used in investing activities

(4,930

)

(5,987

)

Cash flows from financing activities:

Proceeds from exercise of stock options

-

100

Dividends paid

(1,625

)

(1,617

)

Repayment of capital leases

(372

)

(365

)

Net cash used in financing activities

(1,997

)

(1,882

)

Effect of exchange rate changes on cash and cash equivalents

(38

)

-

Net (decrease) increase in cash and cash equivalents

(6,097

)

4,484

Cash and equivalents at beginning of period

27,541

14,973

Cash and equivalents at end of period

$

21,444

$

19,457

Supplemental Cash Flow Information

Interest expense paid

$

24

$

85

Income and mining taxes paid

$

5,239

$

-