Argonaut Gold Announces Second Quarter 2015 Revenue of $44M; Quarter end cash balance increases by $3M excluding payment of $23M to finalize the San Agustin purchase

Toronto, Ontario - (August 14, 2015) Argonaut Gold Inc. (TSX: AR) (the "Company", "Argonaut Gold" or "Argonaut") is pleased to announce its financial and operating results for the second quarter ended June 30, 2015. All dollar amounts are expressed in United States dollars unless otherwise specified.

SECOND QUARTER 2015 FINANCIAL HIGHLIGHTS:

• Revenue of $43.5 million from sales of 36,547 GEOs at an average price of $1,201 per gold ounce.
• Adjusted net loss of $0.1 million, after adjustments for a non-cash write-down of $9.3 million (net of tax) for recoverable ounces in leach pad inventory and lower net realizable value as a result of the decline in gold price in relation to the El Castillo inventory; as well as, the foreign exchange effects of the weakening Mexican peso, which impacted income tax expense by way of an increase in deferred tax expense of $1.1 million. (Refer to Non-IFRS Measures section below). Net loss was $10.5 million.
• Net increase in cash balance of $2.8 million during the quarter, after giving effect to the final payment of $23.2 million, including value added tax ("VAT"), to Silver Standard Resources Inc. ("Silver Standard") for the San Agustin purchase.
• Cash flow from operations before changes in non-cash working capital and other items of $11.4 million.
• Capital investments of $10.9 million (mineral properties, plant and equipment) during the quarter.

2015 Company Highlights:

• Corporate Highlights:
  • Cash balance at June 30, 2015 is $43.7 million with minimal debt (equipment financing leases).
  • Restructured operations to reflect the lower gold price environment, including reduction in site personnel and lowering cyanide concentrations in solution.
• Production:
  • Production of 36,529 GEOs, a 21% improvement over the second quarter of 2014.
  • Overall cash cost of $779 per gold ounce sold for the second quarter and $755 for the first 6 months of 2015 (refer to Non-IFRS Measures section).
  • All-in sustaining cost of $909 per gold ounce sold for the second quarter and $895 for the first six months of 2015 (refer to Non-IFRS Measures section).
• El Castillo:
  • Quarterly production of 21,624 GEOs.
  • During the quarter, 27,954 contained gold ounces loaded on the leach pads.
  • 80 thousand tonnes per day mined and 2.8 million tonnes of mineralized material placed on the heap leach pads during the quarter.
  • Construction of the heap leach pads in 2015 has been completed ahead of schedule.
• La Colorada:
  • Quarterly production of 13,948 gold ounces and 52,648 silver ounces, for 14,905 GEOs.
  • During the quarter, 20,331 contained gold ounces and 417,223 contained silver ounces loaded on the heap leach pads.
  • Record quarterly crusher throughput for the quarter of over 14,700 tonnes per day.
  • Construction:
    • The first phase of the leach pad 6 is complete and the second phase of leach pad 6 is expected to be completed during the fourth quarter of 2015.
    • Construction of leach pad 9a is 95% complete.
    • Installation of the second phase of the overland conveyor was completed.

CEO Commentary
Pete Dougherty, President and CEO of Argonaut Gold stated, "Argonaut achieved another solid quarter of operating performance and again, despite a challenging gold environment, added cash to the balance sheet net of the payment for San Agustin. We made adjustments to our operations during the quarter and will continue to be vigilant in focusing on costs, cash flow and returns in this lower gold price environment. We have advanced our capital projects in the first half of the year with the majority of the work being completed, and with nearly 80,000 ounces of GEO production to date, we are well on our way of achieving our full year production guidance.

With regards to our development projects, we have submitted permits for the San Agustin project and intend to be in a position to make a construction decision by the end of the year. We plan to develop San Agustin as an extension of the El Castillo complex. As for San Antonio, the election process has been completed and we are evaluating the best ways to advance discussions on the project while the newly elected officials prepare to take office this fall. We received positive drill results from Magino and continue work on updating the resource and economic evaluation of that project."

Financial Results - Second Quarter 2015
Revenue for the three months ended June 30, 2015 was $43.5 million, an increase from $40.9 million realized during the three months ended June 30, 2014. During the second quarter of 2015, gold ounces sold totaled 35,321 at an average realized price per ounce of $1,201 (compared to 30,822 gold ounces sold at an average price per ounce of $1,296 during the same period of 2014).

Production costs for the second quarter of 2015 were $28.6 million, an increase from $24.3 million in the second quarter of 2014 due to the increased gold ounces sold. Cash cost per gold ounce sold (refer to Non-IFRS Measures section) was $779 in the second quarter of 2015 compared to $756 in the same period of 2014.

Net loss for the second quarter of 2015 was $10.5 million or $0.07 per basic share, a decrease from net income of $2.0 million or $0.01 per basic share for the second quarter of 2014. The decrease in net income was due principally to the write-down of the leach pad inventory value and ounces totaling $9.3 million net of tax effects and a lower average realized gold price per ounce sold. Other factors included increased production costs and an increase in deferred tax expense due to the foreign exchange effect of the weakening Mexican peso on the calculation of deferred income taxes totaling $1.1 million.

During the second quarter, cash and cash equivalents grew by $2.8 million, excluding the final payment to Silver Standard of $23.2 million for San Agustin. Cash flow from operating activities before changes in non-cash operating working capital and other items was $11.4 million. Cash spent towards capital expenditures in the second quarter was $10.9 million, primarily for deferred stripping and leach pad construction at the El Castillo and La Colorada mines.

SECOND QUARTER 2015 El CASTILLO OPERATING STATISTICS

Summary of Production Results at El Castillo
The gold ounces loaded to the pads in the second quarter 2015 were 25% lower compared to second quarter 2014 due to a lower amount of ore tonnes loaded to the pads resulting from inclement weather and discontinuance of hauling ore directly to the leach pads.

GEO production of 21,624 ounces in the second quarter of 2015 was a 1% improvement over second quarter of 2014. Good production results were achieved in spite of lower ore tonnes and gradually decreasing cyanide concentrations. Production guidance for 2015 at El Castillo is maintained at 85,000 to 90,000 gold equivalent ounces.

SECOND QUARTER 2015 LA COLORADA OPERATING STATISTICS

Summary of Production Results at La Colorada
As anticipated this year, we are currently processing more tonnes from the historic leach pads, therefore, the total tonnes of mineralized material mined decreased by 17% for the second quarter 2015 over second quarter 2014. The strip ratio has decreased as the material from the mine has been primarily sourced from the La Colorada pit. As noted, the crusher throughput from material sourced from both locations exceeded expected levels. As a result, production for the second quarter in 2015 of 14,905 GEOs was achieved; an increase of 67% over second quarter 2014 production of 8,951 GEOs.

We maintain guidance for La Colorada and anticipate gold equivalent ounce production for the full year 2015 to be between 50,000 and 55,000 ounces.

Chief Operating Officer Comments
Richard Rhoades, commenting on the second quarter of 2015, stated, "We completed another quarter of good production results and have completed a significant portion of our capital expansion projects. We continue to focus on reducing costs as demonstrated by the reduction in personnel at El Castillo and also reduced our cyanide concentration levels as we achieved the goal of flushing the pad and reducing inventory. As we move forward, we will continue to focus on controlling costs and maintaining efficiencies in our production efforts. We expect to meet our production guidance for the year, control costs and deliver cash flow during these current market conditions."

Expansion Projects for 2015
The Company maintains its yearly guidance for investments in capital expenditures and exploration initiatives of $37 million. As of June 30, 2015, the Company has spent $22 million on capital expansions. Yearly projections for capital expenditures in 2015 are expected to include approximately $16 million at El Castillo (including $4 million in leach pad expansion, $6 million in sustaining capital and $6 million on capitalized stripping), $11 million at La Colorada (including $3 million in leach pad expansion, $2 million in sustaining capital and $6 million on capitalized stripping), $2 million at Magino, $2 million at San Antonio and $2 million at San Agustin. Exploration expenditures in 2015 are expected to total approximately $4 million.

Company Progress
Pete Dougherty added "We are pleased with the results of the first half of the year, with good operating results and positive cash build, net of the payment to finalize the San Agustin transaction. The Company is maintaining its annual guidance for 135,000 to 145,000 gold equivalent ounces at cash costs of $700 to $750 per ounce, although we expect to come in at the higher end of cost guidance. We are aware of the pressures on the market at this time due to the softening of the gold price. The Company has already taken actions to further reduce operating costs and we aim to continue to grow our strong balance sheet and move our development projects toward future growth.

The Company continues with initiatives to unlock shareholder value at its projects, as permitting continues at the San Agustin, San Antonio and Magino development projects. These projects are expected to provide future production growth to achieve our goal of becoming a 300,000 to 500,000 ounce a year producer with superior returns on investment."

Argonaut Gold Q2 2015 Financial Results Conference Call and Webcast - August 14, 2015:
The Q2 financial results call is scheduled to take place on August 14, 2015 at 8:30 AM (ET). Details for the call-in participation are:

Q2 2015 Conference Call Information for August 14, 2015:

Q2 2015 Conference Call Replay:

The conference call replay will be available from 11:30 AM (ET) on August 14, 2015 to August 21, 2015.

Non-IFRS Measures
The Company has included certain non-IFRS measures including "Cash cost per gold ounce sold", "All-in sustaining cost per gold ounce sold", "Adjusted net income (loss)" and "Adjusted earnings (loss) per share - basic" in this press release to supplement its financial statements which are presented in accordance with International Financial Reporting Standards ("IFRS"). Cash cost per gold ounce sold is equal to production costs less silver sales divided by gold ounces sold. All-in sustaining cost per gold ounce sold is equal to production costs less silver sales plus general and administrative expenses, exploration expenses, accretion of reclamation provision and sustaining capital expenditures divided by gold ounces sold. Adjusted net income (loss) is equal to net income (loss) less the non-cash impairment write down of inventories, net of tax, and the foreign exchange effects of the weakening Mexican peso on the calculation of deferred taxes. Adjusted earnings (loss) per share - basic is equal to adjusted net income (loss) divided by basic weighted average number of common shares outstanding. The Company believes that these measures provide investors with an improved ability to evaluate the performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS. Therefore they may not be comparable to similar measures employed by other companies. The data 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. Please see the management's discussion and analysis ("MD&A") for full disclosure on non-IFRS measures.

This press release should be read in conjunction with the Company's unaudited consolidated financial statements for the three and six months ended June 30, 2015 and associated MD&A, for the same period ended, which are available from the Company's website, www.argonautgold.com, in the "Investors" section under "Financial Filings", and under the Company's profile on SEDAR at www.sedar.com.

Technical Information and Mineral Properties Reports
The technical information contained in this document has been prepared under the supervision of, and has been reviewed and approved by, Mr. Thomas H. Burkhart, Argonaut's Vice President of Exploration, a qualified person as defined by National Instrument 43-101 ("NI 43-101"). For further information on the Company's properties please refer to the reports as listed below on the Company's website www.argonautgold.com or on www.sedar.com :

About Argonaut Gold
Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production stage El Castillo mine in Durango, Mexico, and La Colorada mine in Sonora, Mexico. Advanced exploration stage projects include the San Antonio project in Baja California Sur, Mexico, the Magino project in Ontario, Canada and the San Agustin project in Durango, Mexico. The Company also has several exploration stage projects, all of which are located in North America. The Company is pursuing a development strategy for the San Agustin project that it expects to rely upon common infrastructure with the nearby El Castillo mine. In the event that this strategy is proven out, the Company intends any future development of the San Agustin project to proceed as an extension of the El Castillo mine.

Creating Value Beyond Gold

Cautionary Note Regarding Forward-looking Statements
This press release contains certain "forward-looking statements" and "forward-looking information" under applicable Canadian securities laws concerning the proposed transaction and the business, operations and financial performance and condition of Argonaut Gold Inc. ("Argonaut" or "Argonaut Gold"). Forward-looking statements and forward-looking information include, but are not limited to, statements with respect to estimated production and mine life of the various mineral projects of Argonaut; synergies; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; and financial impact of completed acquisitions; the benefits of the development potential of the properties of Argonaut; the future price of gold, copper, and silver; the estimation of mineral reserves and resources; success of exploration activities; and currency exchange rate fluctuations. Except for statements of historical fact relating to Argonaut, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Many of these assumptions are based on factors and events that are not within the control of Argonaut and there is no assurance they will prove to be correct.

Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include variations in ore grade or recovery rates, changes in market conditions, risks relating to international operations, fluctuating metal prices and currency exchange rates, changes in project parametres, the possibility of project cost overruns or unanticipated costs and expenses, labour disputes and other risks of the mining industry, failure of plant, equipment or processes to operate as anticipated.

These factors are discussed in greater detail in Argonaut's most recent Annual Information Form and in the most recent Management Discussion and Analysis filed on SEDAR, which also provide additional general assumptions in connection with these statements. Argonaut cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Argonaut believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.

Although Argonaut has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Argonaut undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements. Statements concerning mineral reserve and resource estimates may also be deemed to constitute forward-looking statements to the extent they involve estimates of the mineralization that will be encountered if the property is developed. Comparative market information is as of a date prior to the date of this document.

For more information, contact:
Argonaut Gold.
Curtis Turner
Corporate Development Officer
Tel: (775) 284-4422 x 104
Email: [email protected]
www.argonautgold.com