• SOLD 42,757 GOLD EQUIVALENT OUNCES, EXCEEDING 2022 GUIDANCE
  • NET LOSSES OF $6.3 MILLION AND EBITDA OF $29.5 MILLION
  • STRONG CASH BALANCE OF $23.7 MILLION AT YEAR END
  • MINERAL RESOURCE AND RESERVES REPLACED 88% AND 74%, RESPECTIVELY
  • 2022 FINANCIAL RESULTS REMAIN UNAUDITED, BDO USA, LLP, STILL TO COMPLETE FINAL AUDIT PROCEDURES AND RESULTS WILL BE RELEASED WITH THE 10-K

DENVER--(BUSINESS WIRE)--Gold Resource Corporation (NYSE American: GORO) (the “Company”) sold a total of 30,119 ounces of gold and 1,057,209 ounces of silver in 2022 for a total of 42,757 gold equivalent ounces. Additionally, during the year, the Company sold 14,157 tonnes of zinc, 1,348 tonnes of copper, and 5,391 tonnes of lead. For the year ended December 31, 2022, the company reported a net loss of $6.3 million with revenue of $138.7 million and mine gross profit of $29.7 million from operations. A total of $31.3 million was invested in the Don David Gold Mine and Back Forty Project.

Allen Palmiere, President and CEO, said, “Despite global challenges faced this year, such as inflation, and localized challenges such as ground support and ventilation, gold and silver production at the Don David Gold Mine in Mexico still ended the year above guidance. We also made excellent strides with our operations, capital, and exploration programs. The results of the Q4 2022 drilling at DDGM are very promising and have confirmed the ongoing 2023 drill program is on the right track to potentially deliver higher grade resources into the near- and mid-term mine plan. With improved access and ventilation our team can now aggressively continue with the underground infill and expansion drilling to follow-up these positive results. While our grade profile is expected to decline in 2023, we continue to identify and implement productivity improvements. Work continues with the feasibility study to advance the Back Forty Project in Michigan with a deliberate and measured approach. Upon completion, preparation of State of Michigan permits will follow. In both Mexico and Michigan, we are focused on collaborating with local communities to ensure sustainability.”

2022 HIGHLIGHTS

Additional highlights for the year ended December 31, 2022, are summarized below:

Strategic:

  • Cash inflow of $14.2 million from operating activities for 2022, which included $18.6 million of income tax payments for tax years 2021 and 2022.
  • Distributions to shareholders of $3.5 million in shareholder dividends prior to the February 13th, 2023, announcement of the suspension of future quarterly dividends to protect our balance sheet and to focus capital resources on exploration and growth opportunities.
  • Investments of Canadian dollar (“C$”) 2.4 million (approximately $1.7 million) in Maritime Resources Corp. (TSX-V: MAE.V) (“Maritime”) in exchange for 9.9% of Maritime’s shares in a private placement.

Don David Gold Mine:

  • The DDGM safety program aims to bolster the overall health and safety culture of our employees.
    • There were six lost time incidents during 2022. The incidents were thoroughly investigated, and the appropriate actions were taken.
    • The full year lost time injury frequency rate per million hours of 2.5 which is substantially below the 5.7 Camimex (Mexican Chamber of Mines) benchmark.
  • Don David Gold Mine (“DDGM”) total cash costs (after co-product credits) and total all-in sustaining cost per gold equivalent (“AuEq”) ounce sold were $458 and $788, respectively (See “Reconciliation of Non-GAAP Financial Measures” below).
  • During the year, exploration continued to focus on infill drilling with encouraging results from the Arista, Three Sisters, and Switchback vein systems. However, we faced localized ground conditions and ventilation challenges that slowed drift extensions to multiple underground drill stations. Those technical issues have been addressed, and we have commenced step-out drilling in multiple highly prospective areas.

Back Forty Project:

  • The feasibility study work for the Back Forty Project in Michigan, USA progressed during 2022. Work related to metallurgy and the economic model will continue with a deliberate and measured approach and is expected to be completed in the first half of 2023.
  • Once the feasibility study is completed, the Company’s Board of Directors will evaluate the current economic climate and make a decision on how to move forward with the permitting and construction of the Back Forty Mine.
  • The Company continues to meet with the community and government agencies to demonstrate the value of this project.

Full Year 2022 Financial Results

Financial Measures (Unaudited)

($’s in millions)

Cash balance at December 31, 2022

$23.7

For the Year Ended December 31, 2022

Cash from continuing operating activities

$14.2

Net loss

$(6.3)

Net sales

$138.7

Production costs

$80.9

Depreciation, amortization, & reclamation

$28.0

Mining gross profit

$29.7

EBITDA

$29.5

2022 Capital and Exploration Investment Summary

For the year ended December 31, 2022

(in thousands)

Sustaining Investments:

Underground Development

Capital

$

6,619

Underground Exploration Development

Capital

3,034

Infill Drilling

Capital

3,459

Other Sustaining Capital

Capital

3,227

Growth Investments:

Surface Exploration & Other

Exploration

1,929

Underground Exploration Drilling

Exploration

2,315

Back Forty Feasibility Study & Permits

Exploration

8,805

Gold Regrind

Capital

745

Dry Stack Completion

Capital

1,149

Total Capital and Exploration:

$

31,282

Reconciliations of Non-GAAP Financial Measures

The calculations of cash cost after co-product credits per gold equivalent ounce and all-in sustaining cost after co-product credits per AuEq ounce are non-GAAP financial measures. The following table reconciles these non-GAAP measures to GAAP measures:

For the year ended December 31,

2022

2021

(in thousands, except per oz)

Gold equivalent ounces sold (oz)

42,757

37,526

Total production

$

80,949

$

72,234

Treatment and refining charges

12,072

11,485

Co-product credits

(73,442

)

(69,061

)

Total cash cost after co-product credits

19,579

14,658

Total cash cost after co-product credits per AuEq oz sold

$

458

$

391

Sustaining - capitalized expenditure

13,305

11,307

Reclamation and remediation

801

219

Subtotal of DDGM sustaining costs

14,106

11,526

DDGM all-in sustaining cost after co-product credits per AuEq oz sold

$

788

$

698

Sustaining - general and administrative, including stock-based compensation expenses

10,003

7,775

Consolidated all-in sustaining cost after co-product credits

43,688

33,959

Total consolidated all-in sustaining cost after co-product credits per AuEq oz sold

$

1,022

$

905

Non-sustaining cost- capital expenditure

1,894

9,303

Non-sustaining cost- exploration expenditure

13,049

4,886

Subtotal of non-sustaining costs

14,943

14,189

Total all-in cost after co-product credits

58,631

48,148

Total all-in cost after co-product credits per AuEq oz sold

$

1,371

$

1,283

2023 Guidance

The Company’s focus continues to be on unlocking the value of the Don David Gold Mine, existing infrastructure, and large property position in Oaxaca, Mexico and therefore we plan to make significant investments for infrastructure and exploration in 2023.

Measure

2023 Guidance

Payable Production

17,000 to 19,000 Gold Ounces

900,000 to 1,000,000 Silver Ounces

30,000 to 31,000 Gold Equivalent Ounces

Cash Costs after co-product credits per gold AuEq ounce (1) (2)

$1,000 to $1,050

All-in Sustaining Costs after co-product credits per AuEq ounce (1) (2)

$1,250 to $1,350 (DDGM) $1,650 to $1,750 (Consolidated)

Capital Investment

$6 to $7 million

Exploration Commitment

$3 to $4 million Sustaining $6 to $7 million Growth

G & A, excluding Stock-based Compensation

$8.5 million to $9.5 million

(1)

Calculations of cost after co-product credits per gold equivalent ounce and all-in sustaining cost after co-product credits per AuEq ounce are non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures” above.

(2)

Co-product credits directly impact the Cash Costs and All-in Sustaining Costs per AuEq ounce calculation. Guidance is based on approximately 4,200 tonnes of lead sold at an $0.91 per pound metal price, approximately 1,200 tonnes of copper sold at a $3.80 per pound metal prices and 11,200 tonnes of zinc sold at a $1.40 per pound metal price.

Trending Highlights (unaudited)

2021

2022

Q3

Q4

Q1

Q2

Q3

Q4

Full Year

Operating Data

Total tonnes milled

98,010

135,398

136,844

129,099

110,682

116,616

493,241

Average Grade

Gold (g/t)

2.68

1.93

3.00

2.63

1.98

2.51

2.56

Silver (g/t)

91

82

81

64

80

109

83

Copper (%)

0.37

0.38

0.41

0.32

0.37

0.45

0.39

Lead (%)

2.29

2.17

1.97

1.99

1.59

1.58

1.80

Zinc (%)

4.79

4.77

4.89

4.00

4.21

4.27

4.36

Metal production (before payable metal deductions)

Gold (ozs.)

6,933

6,853

11,187

9,317

5,851

7,767

34,122

Silver (ozs.)

265,829

330,873

332,292

249,088

261,256

370,768

1,213,404

Copper (tonnes)

284

413

431

303

296

406

1,436

Lead (tonnes)

1,808

2,345

2,073

2,020

1,249

1,323

6,665

Zinc (tonnes)

3,920

5,349

5,562

4,282

3,901

4,198

17,943

Metal produced and sold

Gold (ozs.)

5,809

6,119

8,381

8,746

5,478

7,514

30,119

Silver (ozs.)

255,394

287,805

265,407

231,622

225,012

335,168

1,057,209

Copper (tonnes)

268

405

408

286

282

372

1,348

Lead (tonnes)

1,550

2,059

1,639

1,755

1,056

941

5,391

Zinc (tonnes)

3,059

4,167

4,359

3,590

2,943

3,265

14,157

Average metal prices realized

Gold ($ per oz.)

1,762

1,811

$ 1,898

$ 1,874

$ 1,627

$ 1,734

1,801

Silver ($ per oz.)

23.19

23.51

$ 23.94

$ 22.05

$ 18.54

$ 21.25

21.53

Copper ($ per tonne)

9,092

9,768

$ 10,144

$ 9,275

$ 7,115

$ 8,221

8,795

Lead ($ per tonne)

2,397

2,339

$ 2,347

$ 2,168

$ 1,882

$ 1,954

2,129

Zinc ($ per tonne)

3,032

3,466

$ 3,842

$ 4,338

$ 3,186

$ 2,577

3,539

Precious metal gold equivalent ounces sold

Gold Ounces

5,809

6,119

8,381

8,746

5,478

7,514

30,119

Gold Equivalent Ounces from Silver

3,356

3,736

3,348

2,729

2,564

4,107

12,638

Total AuEq oz

9,165

9,855

11,729

11,475

8,042

11,621

42,757

Financial Data ($’s in thousands except for per ounce)

Total sales, net

$ 29,029

$ 38,063

$ 45,417

$ 37,064

$ 23,869

$ 32,374

$ 138,724

Earnings from mining operations before depreciation and amortization

11,766

17,744

25,281

15,281

4,431

11,981

56,974

Total cash cost after co-product credits per AuEq oz sold

466

73

(121)

247

1,103

842

458

Total all-in sustaining cost after co-product credits per AuEq oz sold

1,031

451

499

799

1,831

1,226

1,022

Production Costs

17,216

20,252

20,074

21,722

19,380

19,773

80,949

Production Costs/Tonnes Milled

176

150

147

168

175

170

164

Earnings before interest, taxes, depreciation, depletion, and amortization

7,402

10,304

15,328

13,716

(3,338)

3,758

29,464

Operating Cash Flows

5,743

12,911

4,230

7,976

(4,292)

6,242

14,156

Net income (loss)

1,529

2,689

4,019

2,673

(9,730)

(3,283)

(6,321)

Earnings per share – basic

$ 0.02

$ 0.03

$ 0.05

$ 0.03

($ 0.11)

($ 0.04)

($ 0.07)

Year-End 2022 Conference Call

The Company will host a conference call Friday, March 3, 2023, at 10:00 a.m. Eastern Time. Our 2022 Form 10-K will be filed at a future date, no later than March 15, 2023, once our External Audit Firm, BDO USA, LLP, completes their audit procedures.

The conference call will be recorded and posted to the Company’s website later in the day following the conclusion of the call. Following prepared remarks, Allen Palmiere, President and Chief Executive Officer, Kim Perry, Chief Financial Officer and Alberto Reyes, Chief Operating Officer will host a live question and answer (Q&A) session. There are two ways to join the conference call.

To join the conference via webcast, please click on the following link: https://viavid.webcasts.com/starthere.jsp?ei=1594268&tp_key=1f4ada6e2c

To join the call via telephone, please use the following dial-in details:

Participant Toll Free:

+1 (888) 886-7786

International:

+1 (416) 764-8658

Conference ID:

38298670

Please connect to the conference call at least 10 minutes prior to the start time using one of the connection options listed above.

About GRC:

Gold Resource Corporation is a gold and silver producer, developer, and explorer with its operations centered on the Don David Gold Mine in Oaxaca, Mexico. Under the direction of an experienced board and senior leadership team, the company’s focus is to unlock the significant upside potential of its existing infrastructure and large land position surrounding the mine in Oaxaca, Mexico and to develop the Back Forty Project in Michigan, USA. For more information, please visit GRC’s website, located at www.goldresourcecorp.com and read the company’s Form 10-K for an understanding of the risk factors associated with its business.

Forward-Looking 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, our ability to add to our mineral resource estimate at DDGM in the near- or mid-term; scope and timing of work at the Back Forty Project; and guidance for 2023, including payable production, cash costs after co-product credits, all-in sustaining costs, capital investment, exploration spending, and G&A spending. 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. Also, 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 filings with the SEC. Additional factors that could cause or contribute to such differences include, but are not limited to, volatility in commodity prices; changes in interpretations of geological, metallurgical, mining or processing information; interpretations of the information resulting from exploration, analysis or mining and processing experience; unexpected increases in costs; general economic conditions; and other factors discussed in the periodic and current reports filed by the Company with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

Contacts

Kim Perry Chief Financial Officer Kim.Perry@GRC-USA.com www.GoldResourcecorp.com