Gold Resource Corporation Achieves Record Annual Gold Production, Ninth Consecutive Profitable Year, Delivers Earnings of $0.09 Per Share and Provides 2020 Production Outlook

COLORADO SPRINGS, March 02, 2020 (GLOBE NEWSWIRE) — via NEWMEDIAWIRE — Gold Resource Corporation (NYSE American: GORO) (the “Company” or “GRC”) today announced a ninth consecutive year of profitability, reporting net income of $5.8 million or $0.09 per share.  The Company also confirmed its previously announced 2019 consolidated annual production record of 40,318 gold ounces along with 1,732,604 silver ounces.  The Company announced its 2020 consolidated precious metal Outlook targeting 54,000 gold ounces and 1,700,000 silver ounces plus or minus a 10 percent range.  Gold Resource Corporation is a gold and silver producer, developer and explorer with operations in Oaxaca, Mexico and Nevada, U.S.A.  The Company has returned $113 million to its shareholders in monthly dividends since commercial production commenced July 1, 2010 and offers its shareholders the option to convert their cash dividends into physical gold and silver and take delivery.2019 ANNUAL HIGHLIGHTSAchieved its ninth consecutive year of profitability;Record consolidated annual gold production;Achieved 2019 Oaxaca Mining Unit gold production outlook range with 29,435 ounces;Achieved 2019 Oaxaca Mining Unit silver production outlook range with 1.72 million ounces;$135.4 million consolidated net sales, an increase of 17%;$5.8 million net income, or $0.09 per share;Oaxaca Mining Unit $264 total cash costs (after by-product credits) per precious metal gold equivalent ounce sold;Oaxaca Mining Unit $646 total all-in sustaining cost per precious metal gold equivalent ounce sold;Completed construction and commenced production at the Nevada Mining Unit, producing 10,883 gold ounces;100% increase in annualized dividends from $0.02 to $0.04 per share, $1.5 million distributed in shareholder dividends, totaling over $113 million since 2010.2019 Overview“I am very pleased to report Gold Resource Corporation delivered record gold production and its ninth consecutive year of profitability for 2019,” stated Gold Resource Corporation CEO and President, Mr. Jason Reid. “In addition to these achievements, just ten months after ground breaking we brought our Nevada Mining Unit online in April producing first gold from our Isabella Pearl Mine.  We plan to continue ramping up production through 2020 to a targeted annual rate of 40,000 gold ounces for the full year 2021.  Our production models expect a significant increase in gold grade the second half of 2020 which is expected to boost gold production and reduce costs.”For the year ended December 31, 2019, the Company’s Oaxaca Mining Unit sold 41,062 precious metal gold equivalent ounces at a total cash cost of $264 per gold equivalent ounce. Realized 2019 average sales prices were $1,418 per ounce for gold and $16.31 per ounce for silver.  The Company’s Nevada Mining Unit sold 10,272 gold ounces at a total cash cost of $1,040 per ounce.  The Company recorded consolidated revenues of $135.4 million, and net income of $5.8 million, or $0.09 per share. Base metal production generated $75.8 million in revenue for 2019.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 Operations” contained in the Company’s most recent Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.The following Production Statistics table summarize certain information about our Oaxaca and Nevada Mining Unit operations for the three and twelve months ended December 31, 2019 and 2018:Oaxaca Mining UnitBased on actual days the mill operated during the period.The difference between what we report as “ounces/tonnes produced” and “payable ounces/tonnes sold” is attributable to the difference between the quantities of metals contained in the concentrates we produce versus the portion of those metals actually paid for according to the terms of our sales contracts. Differences can also arise from inventory changes incidental to shipping schedules, or variances in ore grades and recoveries which impact the amount of metals contained in concentrates produced and sold.Nevada Mining UnitThe following Sales Statistics tables summarizes certain information about our Oaxaca and Nevada Mining Unit operations for three and twelve months ended December 31, 2019 and 2018:Oaxaca Mining UnitAverage 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.Total cash cost after by-product credits are significantly affected by base metals sales during the periods presented.Nevada Mining UnitAverage 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.2020 Production OutlookThe Company is targeting 2020 consolidated annual production (with ranges based on plus or minus 10%) of 54,000 ounces gold and 1,700,000 ounces silver.  The Company remains focused on mining tonnes based on net smelter return (“NSR”) values per tonne of all metals to maximize cash flow. The Company will continue to focus on its overall margin from both precious and base metal production. Base metal production results in lower production costs per tonne and per ounce when used as a credit against production costs.Year-End 2019 Proven & Probable Reserve UpdateThe Company recently updated its 2019 Nevada and Oaxaca Mining Unit’s Proven and Probable (“P&P”) Reserve Reports as of December 31, 2019.  Year-end 2019 Nevada Mining Unit proven and probable reserves totaled 2,247,400 tonnes grading 3.05 g/t gold.  Gold grade increased year-over-year by 33.8%, which increased contained gold ounces by 5,300 to 220,100.  Mine life at the Company’s Nevada Mining Unit is estimated at four and one-half years.The Company also updated its 2019 Oaxaca Mining Unit Proven and Probable (“P&P”) Reserve Report as of December 31, 2019, reporting 2,831,600 tonnes grading 1.97 grams per tonne (g/t) gold and 122 g/t silver, equating to 179,300 gold ounces and 11,096,400 silver ounces.  The reserve report also includes significant base metals from the Arista Mine consisting of 11,600 tonnes of copper grading 0.4%, 45,400 tonnes of lead grading 1.7% and 133,100 tonnes of zinc grading 4.8%.  Mine life at the Company’s Oaxaca Mining Unit is estimated at four years based on an estimated mill throughput of 2,000 tonnes of ore per day.For additional details on the updated reserve report, please view the P&P press release dated March 2, 2020. The updated full reserve report will be available on the Company’s website in the near future. Projects UpdateOaxaca Mining UnitDuring 2019, the Company continued development of the Arista underground mine, including the Switchback vein system.  Bulk tonnage mining techniques were utilized at Switchback, while also processing a large amount of development ore.  The Company also completed construction of three capital projects in 2019, the paste fill plant, the tailings lift, and the power grid project.  The paste fill plant will improve the Arista Mine’s safety, allow for more efficient extraction of stope pillars when possible, and provide for tailings storage underground which will lessen the demand for surface tailings facilities.  The third phase of the surface tailings impoundment lift was completed in February 2019.  The Company also successfully switched from diesel power generation to lower cost grid power at the Aguila project. For 2020, the Company anticipates spending approximately $12 million to construct a dry stack tailings facility near the Aguila mill.  Dry stack tailings facilities are more environmentally friendly as water can be recycled and dry tailings can be stacked in disturbed areas such as the Aguila pit and original tailings impoundment areas.Nevada Mining UnitThe Company produced first gold doré at the Isabella Pearl mine in April 2019, made initial gold sales of doré in May 2019, and reached commercial production levels in October 2019.  In December 2019, the Company completed construction of the ADR plant and commenced producing doré at the Isabella Pearl Mine site.  During 2020, the Company targets the production of 27,000 gold ounces (plus or minus 10%) at Isabella Pearl.  Gold production is expected to increase the second half of 2020 and when the Company expects to access the upper portions of the high-grade Pearl deposit.The Company’s Nevada Mining Unit now consists of four properties covering more than 7,358 hectares (18,191 acres) in south central Nevada’s Walker Lane Mineral Belt.  The flagship Isabella Pearl mine is currently in production, while the additional three properties are in various stages of exploration.Exploration ProgramOaxaca Mining Unit exploration activities during 2019 focused on underground exploration drilling at the Arista and Switchback vein systems in the Arista Mine. The Switchback drilling program continued to target further expansion and delineation of the multiple high-grade parallel veins for reserve definition, expansion and mine plan optimization.  The Switchback strike length is now over one kilometer and remains open on strike and vertical extent. In 2019, the Company continued to expand the high-grade ore zone at the Mirador mine’s Independencia vein with 18 step-out and in-fill diamond drill holes totaling 2,327 meters.Nevada Mining Unit exploration activities in 2019 included a successful 110-hole, 8,096-meter reverse circulation drilling program targeted to explore and expand mineral reserves at the Isabella Pearl Mine.  This program included in-fill and step-out drill holes on the Pearl, Civit Cat North and Scarlet targets.In 2020, the Company anticipates spending approximately $7 million for exploration activities for both the Oaxaca and Nevada Mining Units.  Exploration expenses may be modified depending on exploration results, metal market conditions and available capital.DividendsThe Company increased its instituted monthly dividend in October 2019, boosting the dividend from $0.02 per share per year, to its current $0.04 per share per year.  Total dividend distributions for 2019 totaled $1.5 million.  The Company has now distributed more than $113 million in dividends back to shareholders since July 2010. See Accompanying Tables
The following information summarizes the results of operations for Gold Resource Corporation for the years ended December 31, 2019, 2018, and 2017, its financial condition at December 31, 2019 and 2018 and its cash flows for the years ended December, 31 2019, 2018 and 2017. The summary data as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2019, 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 precious metal gold equivalent per ounce, total all-in sustaining cost per precious metal gold equivalent per ounce and total all-in cost per precious metal gold equivalent per ounce contained in this press release are non-GAAP financial measures. Please see “Management’s Discussion and Analysis and Results of Operations” contained in the Company’s most recent Form 10-K for a complete discussion and reconciliation of the  non-GAAP measures. GOLD RESOURCE CORPORATION
CONSOLIDATED BALANCE SHEETS
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(U.S. dollars in thousands)About GRC:Gold Resource Corporation is a gold and silver producer, developer and explorer with operations in Oaxaca, Mexico and Nevada, USA.  The Company targets low capital expenditure projects with potential for generating high returns on capital.  The Company has returned $113 million back to its shareholders in consecutive monthly dividends since July 2010 and offers its 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.
Contacts:Corporate Development
Greg Patterson
303-320-7708www.goldresourcecorp.com