The Company completes construction of the facilities for stage one of Phase II expansion at Jiama. The Company reduces total and cash production costs at both mines.

VANCOUVER, Aug. 14, 2014 /CNW/ - China Gold International Resources Corp. Ltd. (TSX: CGG; HKEx: 2099) (the "Company" or "China Gold International Resources") reports financial and operational results for the three months ("Q2", "quarter" or "second quarter 2014") and six months ("first half" or "six months 2014") ended June 30, 2014. The Company revises its 2014 annual production guidance.

Selected Production and Financial Highlights: Q2 2014 Compared to Q2 2013


    --  Consolidated revenues of US$48.5 million for the second quarter of 2014
        decreased by US$33.1 million, from US$81.6 million for the same period
        in 2013.
    --  Revenues from the Chang Shan Hao Gold Mine (the "CSH Mine", the "CSH
        Gold Mine" or "CSH") of US$28.1 million (Q2, 2013: US$46.2 million)
        decreased by US$ 18.1 million due to a 35% decrease in gold sales volume
        and significantly lower gold prices.
    --  Revenue from the Jiama Copper-Gold Polymetallic Mine (the "Jiama Mine"
        or "Jiama") of US$20.4 million (Q2, 2013: US$35.4 million) decreased by
        US$15 million due to a 27% decrease in copper sales  due to changes in
        market demand.  During the three month period, the Company was
        stockpiling the copper concentrate until market demand improves.
    --  Net income of the Company of US$8.4 million for the three months ended
        June 30, 2014 decreased by US$11.1 million from US$19.5 million for the
        three months ended June 30, 2013.
    --  Gold production at the CSH Mine decreased to 24,571 ounces for the three
        months ended June 30, 2014, compared to 32,111 ounces for the three
        months ended June 30, 2013.  Despite the higher grade of ore, gold
        output decreased due to lower recovery rates which were a result of
        longer leaching time with an increased height of the leaching heap.
    --  The cash and total production costs of gold per ounce for the three
        months ended June 30, 2014 decreased compared with the same period in
        2013 due to the lower processing and waste rock removal costs during the
        current quarter.



    CSH Mine                                            Three months ended June 30,

                                                            2014               2013
                                                            ----               ----

    Total production cost (US$) of gold per ounce            733                877


    Total Cash production cost* (US$) of gold per ounce      446                734
    ---------------------------------------------------      ---                ---

    * Non-IFRS measure


    --  Copper production from the Jiama Mine amounted to 9.6 million pounds
        during the three months ended June 30, 2014 compared to 7.7 million
        pounds during the three months ended June 30, 2013.
    --  Cash and total production cost of copper per pound decreased in Q2, 2014
        compared with the same period in 2013 due to the increase in the grade
        of ores during the current period.



    Jiama Mine                                 Three months ended June 30,

                                                   2014               2013


    Total production cost* (US$) of
     copper per pound                              1.78               2.11

    after by-products credits


    Cash production cost**  (US$) of
     copper per pound                              1.09               1.55

    after by-products credits
    -------------------------



    *              Production costs include
                   expenditures incurred at the
                   mine sites for the activities
                   related to production including
                   mining, processing, mine site
                   G&A and royalties etc.

    **            Non-IFRS measure

Selected Financial Highlights: First Half 2014 Compared to First Half 2013


    --  Consolidated revenues of US$85.2 million for the first half of 2014
        increased by US$73.2 million, from US$158.4 million for the same period
        in 2013.
    --  Revenues from the Chang Shan Hao Gold Mine of US$59.7 million (first
        half 2013: US$93.6 million) decreased by US$33.9 million due to a 27%
        decrease in gold sales volume and significantly lower gold prices.
    --  Gold produced by the CSH Mine amounted to 51,689 ounces, compared to
        64,274 ounces for the same period in 2013. The decrease is due to longer
        recovery periods as a result of the increased height of the leaching
        heap.
    --  Revenue from the Jiama Copper-Gold Polymetallic Mine of US$25.5 million
        (first half 2013: US$64.7 million) decreased mostly due to a significant
        decrease in copper production during the first quarter of 2014, due to a
        seasonal electricity shortage experienced by the Jiama Mine.
    --  Net income of the Company of US$9.7 million for the six months ended
        June 30, 2014, decreased by US$24.9 million from US$34.6 million for the
        six months ended June 30, 2013.

Mr. Bing Liu, the CEO and Executive Director of the Company, commented, "We have achieved numerous milestones so far in 2014. We have completed the first stage of construction of the Jiama Mine's Phase II expansion on time. We have successfully managed a US$500 million bond issue. We are reducing costs at both of our mines. At the same time, our company and the rest of the industry are facing challenging market conditions. We believe our superior technical and operating experience and our ability to raise financing will help us weather this downturn in the industry and still deliver profits and growth to our shareholders".

Selected 2014 Operational Achievements 


    --  Phase II expansion at the Jiama Mine is progressing as planned. The
        first stage of Phase II expansion facilities construction, including ore
        storage silo, crusher, mills floatation circuits, thickeners, and power
        and water supply systems was completed in the second quarter of 2014.
        This increased the mill processing capacity from 6,000 tpd to 28,000
        tpd. The pre-striping for open pits and ore transportation system for
        the first stage of the Phase II production facility will be completed in
        the second half of 2014. The new production facility is currently under
        testing. The output of copper concentrate from the first stage of the
        production facility is expected during the second half of 2014.
    --  The Company continues its company-wide cost reduction strategy which has
        resulted in significant decreases in total and cash operating costs for
        both mines.

2014 Revised Production and Operating Outlook for CSH and Jiama


    --  On May 15, 2014, the Company reported expected 2014 annual gold
        production guidance to be 208,000 ounces. The Company revises this 2014
        annual gold production guidance to 165,000 ounces. This is an 11%
        increase from the 2013 actual gold output of 148,326 ounces of gold. The
        revision of the forecast is due to the longer commissioning period of
        the expansion at CSH, caused by repair and reinforcement of the heap
        leach pad. In addition, the revision is in consideration of the longer
        gold recovery period due to the increased heap leach height which
        resulted in reduced gold production in the first half of 2014.  The
        company has sufficient funding and operational and technical expertise
        to successfully resolve those challenges.
    --  In the first half of 2014 the Company had reported that its ongoing
        initiatives to increase production, productivity and efficiency at the
        Jiama Mine were expected to enable it to meet its previously mentioned
        2014 production guidance of approximately 50 million pounds of copper.
        The Company revises its 2014 expected copper production guidance to 28.6
        million pounds, which is a slight increase from the 2013 actual copper
        output of 28.3 million pounds. This revision is due to the reduced
        production in the first quarter of 2014, as Jiama experienced power
        supply shortages.  In addition, the revision is in consideration of
        expected lower recovery rate from the high oxide ore from the south pit
        during the second half of 2014, uncertainties relating to power supply
        shortage in the fourth quarter and duration of the commissioning period
        of the Phase II expansion.
    --  The Company will continue to leverage the technical and operating
        experience of the Company's controlling shareholder, China National Gold
        Group Corporation ("CNG"), to improve operations at its mines, increase
        production and minimize costs.
    --  To fulfill its growth strategy, the Company is continually working with
        CNG and other interested parties to identify potential international
        mining opportunities, mainly outside of China, which can be readily and
        quickly brought into production with the possibility of further
        expansion through continued exploration.

Analysts, investors, media and general public are encouraged to visit the Company's website, sedar.com or hkexnews.hk to view the complete set of the financial statements and MD&A or contact the Company with any questions.

About China Gold International Resources

China Gold International Resources Corp. Ltd. is based in Vancouver, BC, Canada and operates both profitable and growing mines, the CSH Gold Mine in Inner Mongolia, and the Jiama Copper-Polymetallic Mine in Tibet Autonomous Region of the People's Republic of China. The Company's objective is to continue to build shareholder value by growing production at its current mining operations, expanding its resource base, and aggressively acquiring and developing new projects internationally. The Company is listed on the Toronto Stock Exchange (TSX: CGG) and the Main Board of The Stock Exchange of Hong Kong Limited (HKEx: 2099).

For a detailed look at the financial statements and MD&A for the quarter ended March 31, 2013, please visit the Company's website at www.chinagoldintl.com, The Stock Exchange of Hong Kong Limited's website at www.hkex.com.hk or SEDAR at www.sedar.com.

Cautionary Note About Forward-Looking Statements

Certain information regarding China Gold International Resources contained herein may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although China Gold International Resources believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. China Gold International Resources cautions that actual performance will be affected by a number of factors, most of which are beyond its control, and that future events and results may vary substantially from what China Gold International Resources currently foresees. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration results, continued availability of capital and financing and general economic, market or business conditions. The forward-looking statements are expressly qualified in their entirety by this cautionary statement. The information contained herein is stated as of the current date and subject to change after that date.

SOURCE China Gold International Resources Corp. Ltd.