Highland Gold Mining : announces Final results for the year ended 31 December 2013

Released: 23 April 2014

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23 April 2014 - Highland Gold Mining Limited ("Highland Gold", the "Company" or the "Group" AIM: HGM) announces its final audited results for the year ended 31 December 2013.

FINANCIAL HIGHLIGHTS

*Further information on this restatement can be found in selected policies and notes to the financial information.

Eugene Shvidler, Chairman of Highland Gold Mining, commented: "During 2013 management extended the Company's resource base, oversaw further organic expansion and continued to implement appropriate financial disciplines and production efficiencies. The latter measures, applied throughout the Group's operations, served to mitigate the effects of an adverse trading climate. One of the highlights was the first gold pour at our Belaya Gora processing plant which, with ramp-up to nameplate capacity under way, will make an important contribution to the sizeable increase in overall production budgeted for 2014. We completed the purchase of the Kekura property and this, together with the Klen project, also situated in the Chukotka region, will remain at the forefront of our exploration and development agenda. Your Board believes that the accomplishments of 2013 and our strategy in respect of 2014 will significantly further the medium and long-term realisation of the Company's growth potential."

2013 KEY EVENTS

• Group wide production rose 8% to a record 233,696 oz of gold and gold equivalents (2012: 216,885 oz). This is in line with our guidance estimate and represents the combined contribution from the Group's three mines: Mnogovershinnoye (MNV), Novoshirokinskoye (Novo) and Belaya Gora
• Total cash costs recorded a sharp decline to US$611 per ounce (2012: US$671 per ounce) and remained highly competitive versus peer group. All-in sustaining cash costs decreased to US$842 (2012: US$894)
• Total cash costs of US$749 per ounce remained competitive versus peer group (2011: US$594 per ounce)
• Group JORC compliant resources registered a 32% increase to 17.3 Moz (compared with 13.2 Moz stated at 31 December 2012) as a result of the Kekura licence purchase and independent resource audit updates at MNV and Unkurtash
• The Group's assets remained unimpaired despite significant declines in metal prices
• First gold poured at Belaya Gora
• Interim dividend of 2.5 pence per share paid in October 2013 (2012: Interim special dividend of 4.8 pence per share)
• Lost Time Incident (LTI) rate was reduced to 0.28 in 2013 compared with 0.31 in 2012
• ISO 14001 (2004) certification awarded in respect of the environmental management systems at MNV and Russdragmet (RDM) LLC, the Moscow-based management company

POST YEAR EVENTS

• Final dividend of 2.5 pence per share recommended, making a total distribution of 5.0 pence for the year to 31 December 2013 (2012: 7.8 pence)

2014 TARGETS

• Total production in 2014 is expected to increase to more than 300,000 oz of gold and gold equivalents (derived from MNV, Novo and Belaya Gora)
• Ramp-up of the Belaya Gora plant to nameplate capacity
• MNV - maintain stable production and rigorous cost controls
• Novo - improve efficiencies and drive further increases in plant throughput
• Chukotka - ongoing development of the Klen and Kekura projects
• Exploration - focus on near mine exploration programme and delineating upside of the Chukotka projects

CONFERENCE CALL DIAL-IN DETAILS

The Company will hold a conference call on Wednesday, 23 April 2014 hosted by Valery Oyf, CEO, to discuss the final results. The conference call will take place at 10.00 UK time (13.00 Moscow). The link for the online registration is set out below:
http://emea.directeventreg.com/registration/33515642

For further information please contact:

The Annual General meeting will be held on 27 May 2014
www.highlandgold.com