TORONTO , Aug. 12, 2015 /CNW/ - Roxgold Inc. ("Roxgold" or "the Company") (ROG.V) today reported its financial results for the three and six month period ended June 30, 2015 , including development highlights from its Yaramoko project in Burkina Faso , West Africa .

For complete details of the unaudited Condensed Interim Consolidated Financial Statements and associated Management's Discussion and Analysis please refer to the Company's filings on SEDAR (www.sedar.com) or the Company's website (www.roxgold.com).

SECOND QUARTER 2015 HIGHLIGHTS

Over the second quarter 2015 Roxgold made significant progress on developing the Yaramoko project.  As at June 30, 2015 , the Company had:

• Pre-production capital cost estimate updated to US$110.8 million , an increase of 4% from the amount in the Feasibility Study due to scope changes;
• Construction started at the Yaramoko Gold Project with US$23 million spent to June 30, 2015 of the overall US$110.8 million cost estimate and is on track for first gold pour in the second quarter of 2016;
• Receipt of approved Mining Convention under the 2003 Burkina Faso's Mining Code;
• Signed credit agreement of US$75 million (the "Debt Facility") with BNP Paribas and Société Générale Corporate and Investment Banking;
• Proposed $18.4 million investment by the International Finance Corporation ("IFC");
• Corroboration of the high grade and continuous nature of the 55 Zone with the infill drilling program; and
• Discovery of a new mineralized domain at Bagassi South including 23.6 grams of gold per tonne ("gpt") over 10.9 meters.

DEVELOPMENT ACTIVITIES

A.                   Construction Update

During the first six months of 2015, the Company updated its pre-production capital cost estimate for the Yaramoko project to US$110.8 million , an increase of approximately 4% from the amount in the Feasibility Study published in April 2014 , resulting primarily from scope changes. The changes include the adoption of a plastic liner for the project's tailings storage facility, which was a new requirement outlined by Burkina Faso's environmental permitting authority.

In addition, the SAG (semi-autogenous grinding) mill and associated equipment were upsized to facilitate a future expansion of the processing plant's capacity and the backup (diesel) power station capacity was also increased, which will provide Yaramoko with full standby capability in support of the power line, which will be connected to the grid.

For more information please refer to the Company's April 7, 2015 press release available on SEDAR at www.sedar.com.

Camp Construction and Bulk Earthworks

As of the reporting date, De Simone, a contractor with extensive experience at similar operations in West Africa is building the permanent 190 person camp. All accommodation building brickwork has been finished with roofing well advanced. Camp equipment is expected to be on site for installation in August. Camp handover and occupancy is expected to occur in the latter part of the third quarter of 2015.

Construction of the project's water storage facility, tailings storage facility, roads and terracing for the processing plant progressed well during the second quarter, with bulk earthworks generally being ahead of schedule and two thirds complete as of the reporting date. The water storage facility is completed and is collecting water as it is now the wet season. The tailing storage facility embankment is also completed.

Mine Development

With regards to mining activities, the corrugated liner plate tunnel has been delivered on site during the quarter. The box cut excavation was completed in May 2015 after two successful blasts while the box cut portal was completed late July. With the mobilization of African Underground Mining Services ("AUMS") in early July 2015 , the commencement of the decline development is scheduled for August 2015 .

Processing Plant

The engineering, procurement, and construction ("EPC") contractor mobilized during the latter part of the second quarter and has subsequently advanced civil works and procurement of long lead items.

Personnel

As of the reporting date, there are approximately 700 personnel on site working on the Yaramoko project.  For more information on the project development please refer to the Company's August 4, 2015 press release available on SEDAR at www.sedar.com.

B.             Permitting

On May 27, 2015 , the Council of Ministers of Burkina Faso formally approved the Mining Convention (the "Convention") for the Yaramoko project. The Convention sets out the fiscal and legal terms with respect to the operation of the Yaramoko project, including taxation rates applicable to the project, per the 2003 Burkina Faso Mining Code. The Convention is valid for 20 years commencing on the date of the grant, and may be renewed for subsequent periods of five years.

The signed Convention is effective from July 13, 2015 and satisfies a key condition precedent associated with the Yaramoko Project's debt financing.

A copy of the Convention is available on SEDAR at www.sedar.com.

C.             Financing Update

On June 9, 2015 , the Company signed a credit agreement (the "Debt Facility") with BNP Paribas and Société Générale Corporate & Investment Banking, for a total of US$75 million . The Debt Facility will be used towards the development of Roxgold's Yaramoko project.

The Debt Facility has a six-year term. Advances under the Debt Facility will bear interest at a rate of LIBOR plus 4.75% pre-completion and 4.25% post completion. The US$15 million cost overrun account has been funded from equity through the proceeds of the November 4, 2014 public offering. Drawing under the Debt Facility is subject to the satisfaction of certain customary conditions precedent, including the execution of a hedging program covering the gold price exposure for 65,000 ounces of Yaramoko's projected gold production, which equates to approximately 8.5% of the Company's current reserves over the life of loan. The Debt Facility is also supported by secured guarantees from the Company and each of its material subsidiaries.

D.            55 Zone Infill Drilling

Grades and widths encountered within the 55 Zone infill drilling program to date have been consistent with expectations. The highlights from these initial results are listed below (all intervals are reported uncut):

• 58.1 gpt gold over 4.8 metres (4.1 metres true width) including 117.6 gpt gold over 2.3 metres (2.0 metres true width) in diamond drill hole YRM-15-DD-302;
• 42.3 gpt gold over 3.8 metres (3.0 metres true width) including 87.4 gpt gold over 1.8 metres (1.5 metres true width) in diamond drill hole YRM-15-DD-303;  
• 60.9 gpt gold over 2.35 metres (2.0 metres true width) in diamond drill hole YRM-15-DD-305;
• 200.7 grams per tonne gold over 5.9 metres (4.8 metres estimated true width) including 460.0 gpt gold over 2.5 metres (2.0 metres estimated true width) in diamond drill hole YRM-15-DD-316;
• 135.3 gpt gold over 5.7 metres (4.8 metres estimated true width) including 290.6 gpt gold over 2.6 metres (2.2 metres estimated true width) in diamond drill hole YRM-15-DD-313;
• 123.0 gpt gold over 4.2 metres (3.1 metres estimated true width) including 251.0 gpt gold over 2.0 metres (1.5 metres estimated true width) in diamond drill hole YRM-15-DD-307;
• 48.3 gpt gold over 6.9 metres (6.0 metres estimated true width) including 248.0 gpt over 0.9 metres (0.8 metres true width) and including 66.0 gpt over 0.9 metres (0.8 metres estimated true width) in diamond drill hole YRM-15-DD-314; and
• 30.0 gpt gold over 9.2 metres (7.5 metres true width) including 116.7 gpt over 2.0 metres (1.6 metres true width) in diamond drill hole YRM-15-DD-323.

For more information please refer to the Company's April 14, 2015 press release available on SEDAR at www.sedar.com.

E.          Regional Exploration program

During the second quarter of 2015, Roxgold discovered a new mineralized domain at Bagassi South, the QV1 extension. By the end of the quarter, the Company had defined a strike length of 230 metres on the QV1 extension and had traced it to the south where the mineralization was crosscut by a late dolerite dyke.

Highlights from this program at Bagassi South included (all intervals are reported uncut)*:

• 23.6 gpt gold over 10.9 metres and a second interval of 8.2 gpt gold over 6.0 metres in diamond drill hole YRM-15-DD-BGS-083;
• 7.5 gpt gold over 10.6 metres including 22.2 gpt gold over 3.2 metres in diamond drill hole YRM-15-DD-BGS-084; and
• 10.4 gpt gold over 19.4 metres including 25.1 gpt gold over 7.1 metres in diamond drill hole YRM-15-DD-BGS-085.

*True widths for QV1 intersections are estimated to be between 85% and 90% of reported core intervals.

For more information please refer to the Company's May 5, 2015 press release available on SEDAR at www.sedar.com.

F.           Annual and Special Meeting

On June 11, 2015 , the Company held its Annual and Special Meeting in Toronto.  Shareholders voted to elect the Company's eight-member Board of Directors (the "Board") with 73.81% of shares outstanding represented at the meeting.

In addition, Roxgold shareholders approved:

PricewaterhouseCoopers LLP as the Company's auditors;

• The renewal of the Company's rolling stock option plan (the "Option Plan") whereby the Company is authorized to grant stock options of up to 10% of its issued and outstanding shares, from time to time.

EVENTS SUBSEQUENT TO JUNE 30, 2015

A.       Mobilization of Underground Mining Contractor

On July 6, 2015 , the Company mobilized its underground mining contractor, a subsidiary of African Underground Mining Services ("AUMS"), to its Yaramoko project in Burkina Faso , West Africa . The mining services contract entered into with the underground mining contractor (the "Mining Contract") has an initial term of four years and includes the provision of a mining fleet and skilled labour force. As previously announced, Roxgold also has the option to settle up to US$10 million in payments under the Mining Contract in the form of the Company's common shares (the "Payment Shares"). The subscription price for each Payment Share will be based on a 5% discount to the volume weighted average price of Roxgold shares on the TSX Venture Exchange for the five trading days following the date of the particular invoice. The proceeds of the sale of the Subscription Shares (defined below) and the value of services to be provided in exchange for the Payment Shares together represent approximately 50% of the anticipated pre-production underground development capital expenditures.

For more information please refer to the Company's July 6, 2015 press release available on SEDAR at www.sedar.com.

B.       Closing of US$5 million private placement to AUMS

On July 20, 2015 , the Company closed a US$5 million private placement to AUMS in connection with its mobilization. The private placement consisted of the issuance of 8,979,286 Roxgold common shares (the "Subscription Shares") at a price of $0.70 per share, for gross proceeds of approximately $6,286,000 . AUMS now holds approximately 3% of the issued and outstanding common shares of the Company on an undiluted basis.

No finders' fees or commissions were payable in connection with the private placement. The net proceeds of the offering will be used to partially fund the development and exploration of the Company's Yaramoko project in Burkina Faso , West Africa , and for general corporate purposes.

C.       Execution of the Hedging Program

In July 2015 , the Company completed the execution of the Hedging Program associated with the Debt Facility.  The Hedging Program totals forward sales of 65,000 ounces at an average price of US$1,052 per ounce, which are to be settled on a monthly basis from January 2017 to March 2021.  The execution of the Hedging Program satisfies a key condition precedent associated with the Debt Facility.

D.       New Mining Code in Burkina Faso

On July 16, 2015 , a new mining code was ratified by the interim president of Burkina Faso . The principal changes are the establishment of a Mining Fund for Local Development, which will be funded at the rate of 1% of the monthly value of products extracted and the increase of the corporate tax rate to 27.5%.

The Yaramoko project mining convention signed on July 13, 2015 along with the mining decree granted on February 2, 2015 were issued in accordance with the 2003 Burkina Faso Mining Code and as such the Yaramoko project is subject to a corporate tax rate of 17.5%.

E.        Bagassi South Results

The Company received the results of an 8 hole 1,900 metre diamond drill program that was designed to test for mineralization to the south of the Bagassi dyke as well as evaluate the up dip potential on the northern side of the dyke above diamond drill holes 083 and 085 completed in the first semester of 2015.

Highlights of the latest drilling program include (all intervals are reported uncut)*:

• 13.7 gpt gold over 7.2 metres including 13.7 gpt gold over 1.5 metres and 40.3 gpt over 1.5 metres in diamond drill hole YRM-15-DD-BGS-090;
• 11.0 gpt gold over 7.5 metres including 33.7 gpt gold over 0.8 metres and 19.4 gpt over 1.7 metres in diamond drill hole YRM-15-DD-BGS-091; and
• 14.5 gpt gold over 6.1 metres in diamond drill hole YRM-15-DD-BGS-095.

More exploration drilling is planned south of the dyke to follow up on this program in Q3 and Q4 of 2015 to continue to test and define the extents of mineralization at QV1 which remains open down dip and plunge.

*True widths for QV1 intersections are estimated to be between 85% and 90% of reported core intervals.

For more information please refer to the Company's August 11, 2015 press release available on SEDAR at www.sedar.com.

5.         Near Term Corporate Objectives¹

Roxgold will continue to advance its Yaramoko project throughout 2015.  In the near term, planned activities at the Yaramoko project include:

• Initial drawdown under the US$75 million Debt Facility;
• Continue construction at the Yaramoko project with first production scheduled for Q2 2016;
• Continue to develop the systems and procedures to transition to operations; and
• Further exploration work at the promising Bagassi South prospect

SELECTED FINANCIAL DATA

___________________________
¹ Certain elements of Near Term Corporate Objectives are forward-looking. For more information see the "Cautionary note regarding forward-looking statements".

Second Quarter of 2015 vs. Second Quarter of 2014

General and administrative expenses decreased compared to the same period in 2014. The net decrease is due to several non-recurring consulting expenditures incurred in 2014 which did not transpire in 2015 while higher salaries costs reflect new hires in 2015 made at the Company's corporate office to complete the corporate team. In addition, 2015 costs relating to the Debt Facility were capitalized whereas during the same period in 2014 they were not.

Share-based payment costs of $249,000 in the second quarter of 2015 include $84,000 (2014: $101,000 ) of costs associated with the vesting of stock options, $97,000 (2014: $136,000 ) related to the fluctuation of the value of deferred share units ("DSU") granted under the initial DSU plan and costs of $68,000 (2014: $60,000 ) related to the restricted share units ("RSU") granted under the initial RSU plan. 

The other expenses during the three-month period ended June 30, 2015 are mainly due to a foreign exchange loss in relation to the Company's cash on hand during the period which was offset slightly by interest income earned for the period. Indirect taxes relate to withholding taxes on management fees charged to the Company's subsidiaries in Burkina Faso .

As a result, the Company's net loss for the three-month period ended June 30, 2015 totalled $905,000 , or a loss of $0.01 per share, compared to a net loss of $1,968,000 for the three-month period ended June 30, 2014 , or a loss of $0.01 per share.

QUALIFIED PERSONS

Ben Pullinger P.Geo , VP Exploration for Roxgold Inc., a Qualified Person within the meaning of National Instrument 43-101, has verified and approved the technical disclosure contained in this press release.

Craig Richards P.Eng , Principal Mining Engineer for Roxgold Inc., a Qualified Person within the meaning of National Instrument 43-101, has verified and approved the technical disclosure contained in this press release.

ABOUT ROXGOLD

Roxgold is a gold exploration and development company with its key asset, the high grade Yaramoko Gold Project, located in the Houndé greenstone region of Burkina Faso , West Africa . The Company is currently advancing Yaramoko's 55 Zone through development and expects to commence production in the first half of 2016. Roxgold trades on the TSX Venture Exchange under the symbol ROG.

"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."

These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management's expectations. In certain cases, forward-looking information may be identified by such terms as "anticipates", "believes", "could", "estimates", "expects", "may", "shall", "will", or "would". Forward-looking information contained in this news release is based on certain factors and assumptions regarding, among other things, the estimation of mineral resources and mineral reserves, the realization of resource estimates and reserve estimates, gold metal prices, the timing and amount of future exploration and development expenditures, the estimation of initial and sustaining capital requirements, the estimation of labour and operating costs, the availability of necessary financing and materials to continue to explore and develop the Yaramoko project in the short and long-term, the progress of exploration and development activities, the receipt of necessary regulatory approvals, the completion of the environmental assessment process, and assumptions with respect to currency fluctuations, environmental risks, title disputes or claims, and other similar matters. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include risks inherent in the exploration and development of mineral deposits, including risks relating to changes in project parameters as plans continue to be redefined including the possibility that mining operations may not commence at the Yaramoko project, risks relating to variations in mineral resources and mineral reserves, grade or recovery rates resulting from current exploration and development activities, risks relating to changes in gold prices and the worldwide demand for and supply of gold, risks related to increased competition in the mining industry generally, risks related to current global financial conditions, uncertainties inherent in the estimation of mineral resources and mineral reserves, access and supply risks, reliance on key personnel, operational risks inherent in the conduct of mining activities, including the risk of accidents, labour disputes, increases in capital and operating costs and the risk of delays or increased costs that might be encountered during the development process, regulatory risks, including risks relating to the acquisition of the necessary licenses and permits, financing, capitalization and liquidity risks, including the risk that the financing necessary to fund the exploration and development activities at the Yaramoko project may not be available on satisfactory terms, or at all, risks related to disputes concerning property titles and interest, and environmental risks. Please refer to the Company's Short Form Prospectus dated October 24, 2014 filed on SEDAR at www.sedar.com for political, environmental or other risks that could materially affect the development of mineral resources and mineral reserves. This list is not exhaustive of the factors that may affect any of the Company's forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking information. The Company does not undertake to update any forward-looking information that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.

SOURCE Roxgold Inc.