Galiano GOLD Reports Q2 Production and Financial Results and a 45% Increase to Abore Mineral Reserve Estimate
GALIANO GOLD REPORTS Q2 PRODUCTION
AND FINANCIAL RESULTS AND A 45% INCREASE TO ABORE
MINERAL RESERVE ESTIMATE
Vancouver, British Columbia, August 8, 2024 – Galiano Gold Inc. (“Galiano” or the “Company”) (TSX, NYSE
American: GAU) is pleased to report its second quarter (“Q2”) 2024 production and financial results, as well as a
significant increase to the Abore deposit Mineral Reserve estimate (effective June 30, 2024). Galiano owns a 90%
interest in the Asanko Gold Mine (“AGM”) located on the Asankrangwa Gold Belt in the Republic of Ghana, West
Africa.
All financial information contained in this news release is unaudited and reported in United States dollars.
During Q2, the Company produced 26,437 gold ounces at all-in sustaining costs 1 (“AISC”) of $1,759 per gold ounce
sold (“/oz”) and generated $9.2 million of operating cash flows from the AGM. The Company remains debt free with
$123.0 million in cash, and the strong operating cash flows are supporting the ramp-up of the AGM as the Company
executes its return to hard rock mining operations.
45% increase in Mineral Reserves at Abore to 485,000 ounces
The Company is pleased to report that following a successful infill drilling campaign in 2023 and early 2024, the
Proven and Probable Mineral Reserves at the Abore deposit have increased to 11.8 million tonnes (“Mt”) at a grade
of 1.28 grams per tonne (“g/t”) gold, representing an increase of 151,000 ounces (45%) to 485,000 ounces, effective
June 30, 2024, when compared to the report titled “NI 43-101 Technical Report and Feasibility Study for the Asanko
Gold Mine, Ashanti Region, Ghana" with an effective date of December 31, 2022 (“2023 Technical Report”).
These results, in addition to infill and step out drilling results at other deposits, will be used to update a consolidated
AGM Mineral Reserve estimate and an optimized life of mine plan in the fourth quarter of 2024.
Asanko Gold Mine Q2 highlights (100% basis):
Subsequent to closing of the transaction with Gold Fields Ltd., the operational and financial results of the AGM have
been consolidated into the Company from March 4, 2024 onwards. To enable a comprehensive understanding of
the operational performance at the mine asset level, the following highlights for the AGM are presented on a 100%
basis for the entire six months ended June 30, 2024.
Safety: There were no lost-time injuries (“LTI”), nor total recordable injuries (“TRI”), recorded during Q2. The
12-month rolling LTI and TRI frequency rates as of June 30, 2024 were 0.15 and 0.60 per million employee hours
worked, respectively.
Production performance: Gold production of 26,437 ounces during Q2 and 56,823 ounces year-to-date. Gold
production during Q2 was impacted by challenging ground conditions in the upper portion of the Abore pit and
heavy seasonal rainfall in Ghana, which impacted fresh ore delivery to the mill such that a greater proportion of
lower grade stockpiles were processed than originally planned. Lower throughput resulting from harder material
processed also affected production levels.
Milling performance: Achieved mill throughput of 1.3 Mt of ore at a grade of 0.7 g/t during Q2, with
metallurgical recovery averaging 82%. Mill throughput during Q2 was 9% lower than the first quarter of 2024
1 Refer to Non-IFRS Performance Measures
2
due to processing harder ore both mined from Abore and stockpiled material that was previously mined from
Nkran. Engineering and early earthworks for the installation of a permanent secondary crusher continued during
the quarter and is expected to be completed in the first half of 2025. This circuit upgrade will maintain plant
throughout at 5.8 Mtpa when treating harder ore.
Cost performance: Total cash costs 1 of $1,271/oz and AISC 1 of $1,759/oz for the three months ended June 30,
2024. Year-to-date AISC1 of $1,777/oz.
Revised 2024 guidance: Due to the slower than expected ramp-up in mining, coupled with temporary lower mill
throughput, the Company is revising full year production guidance from between 140,000 to 160,000 ounces to
between 120,000 and 130,000 ounces. Operating costs are estimated to be in line with previous expectations,
however AISC1 guidance per gold ounce sold for 2024 is being revised from between $1,600/oz to $1,750/oz to
between $1,975/oz and $2,075/oz. This increase is due to lower expected gold production coupled with
investments in additional stripping at Abore.
Cash flow generation: Generated positive cash flow from operations of $9.2 million, with Free Cash Flow 1
negative at $4.5 million during Q2 due to investments in waste stripping at the Abore deposit.
Financial performance: Gold revenue of $63.8 million generated from 27,830 gold ounces sold at an average
realized price of $2,292/oz during Q2. Net income of $13.9 million and Adjusted EBITDA1 of $19.3 million during
Q2.
Galiano Q2 Highlights:
Robust liquidity: The Company ended the quarter with $123.0 million in cash and cash equivalents and no debt.
Earnings: Net income of $8.8 million or $0.03 per common share during Q2, which included the consolidation
of the AGM’s financial results for the three months ended June 30, 2024. Adjusted net income 1 for Q2 was $7.3
million or $0.03 per common share.
Senior management appointment: Appointed Michael Cardinaels as Executive Vice President and Chief
Operating Officer (“COO”), effective September 3, 2024. The appointment of Mr. Cardinaels as the new
Executive Vice President and COO is part of the Company’s commitment to operational improvements and its
overarching strategy to drive growth at the AGM. Mr. Cardinaels brings over two decades of mining sector
experience across various commodities, most recently with Perseus Mining Ltd.
“The second quarter of 2024 marked significant progress in advancing mining operations at the Abore deposit, while
the Company remained fully funded by operating cash flow,” said Matt Badylak, Galiano’s President and Chief
Executive Officer. “In addition, the 45% increase in Abore’s Mineral Reserves highlights the value that we are
beginning to realize beyond the 2023 Technical Report, as well as the prospectivity of our tenements. Although 2024
production and costs have been impacted by a slower than expected ramp-up, the growth in Mineral Reserves and
resulting investments in stripping during the second quarter will enhance the optimized life of mine plan, resulting
in a larger, longer-term net benefit for the Company and its stakeholders.
As we continue to generate positive cash flows from operations and maintain a robust balance sheet, Galiano
remains uniquely positioned to execute on its strategy to become a leading mid-tier gold producer.
I am also pleased to be welcoming Michael Cardinaels to the position of Chief Operating Officer at Galiano. Michael
has over 20 years of industry experience including significant exposure to mining complex orogenic deposits on the
African continent. His technical expertise, energy and enthusiasm will be valued as we continue ramping up
production at the AGM.”
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Asanko Gold Mine – Summary of quarterly operational and financial highlights (100% basis)
Operating and financial results are on a 100% basis for all periods presented to enable comparability with prior
quarters.
Asanko Gold Mine (100% basis) Q2 2024 Q1 2024 Q4 2023 Q3 2023 Q2 2023
Mining
Ore mined (‘000t) 467 265 22 - -
Waste mined (‘000t) 7,427 4,877 3,415 - -
Total mined (‘000t) 7,894 5,142 3,437 - -
Strip ratio (W:O) 15.9 18.4 155.2 - -
Average gold grade mined (g/t) 1.0 0.9 0.7 - -
Mining cost ($/t mined) 2.98 3.63 4.30 - -
Ore tonnes trucked (‘000 t) 503 566 657 695 729
Ore transportation cost ($/t trucked) 5.71 6.79 6.54 6.63 5.88
Processing
Ore milled (‘000t) 1,336 1,467 1,486 1,573 1,457
Average mill head grade (g/t) 0.7 0.8 0.8 0.8 0.8
Average recovery rate (%) 82 83 84 87 85
Processing cost ($/t milled) 11.18 10.55 9.94 9.69 11.01
G&A cost ($/t milled) 5.13 4.74 5.55 4.16 4.68
Gold produced (oz) 26,437 30,386 31,947 35,779 33,673
Financials, costs and cash flow
Revenue ($m) 64.0 65.6 59.5 67.8 64.1
Gold sold (oz) 27,830 31,840 30,555 35,522 32,912
Average realized gold price ($/oz) 2,292 2,056 1,942 1,902 1,944
Total cash costs1 ($/oz) 1,271 1,180 1,352 1,056 1,127
All-in sustaining costs 1 ($/oz) 1,759 1,793 2,065 1,445 1,374
All-in sustaining margin1 ($/oz) 533 263 (123) 457 570
All-in sustaining margin1 ($m) 14.8 8.4 (3.8) 16.2 18.8
Income from mine operations ($m) 23.1 23.5 8.7 23.7 24.4
Adjusted net income1 ($m) 13.9 23.5 3.7 21.3 24.4
Cash provided by operating activities ($m) 9.2 26.1 24.1 39.7 18.0
Free cash flow1 ($m) (4.5) 5.8 2.3 24.0 10.1
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Asanko Gold Mine – Financial and operational highlights for the three and six months ended June 30, 2024 and
2023 (100% basis)
The following tables present excerpts of the operating and financial results of the AGM on a 100% basis for the three
and six months ended June 30, 2024 and 2023, so performance can be compared with the comparative period in the
prior quarter.
The AGM produced 26,437 ounces of gold during Q2 2024, as the processing plant achieved milling throughput
of 1.3 Mt of ore at a grade of 0.7 g/t with metallurgical recovery averaging 82%. Mill feed for the quarter was
sourced primarily from existing stockpiled ore with a blend of mined Abore material. Milling rates during Q2
were impacted by harder ore from Abore and Nkran stockpiles. The Company is in the process of installing a
permanent secondary crushing circuit, which is anticipated to maintain plant throughput when treating harder
ore at design capacity of 5.8 Mtpa once completed in the first half of 2025.
Sold 27,830 ounces of gold in Q2 2024 at an average realized gold price of $2,292/oz for total revenue of $64.0
million (including $0.2 million of by-product silver revenue), in line with Q2 2023 revenue. Revenue was flat
quarter-on-quarter as an 18% increase in realized gold prices relative to Q2 2023 was largely offset by a 15%
reduction in sales volumes.
Income from mine operations for Q2 2024 totaled $23.1 million, comparable with $24.4 million in Q2 2023.
Reported Adjusted EBITDA 1 of $19.3 million in Q2 2024 compared to $25.5 million in Q2 2023. The decrease in
Adjusted EBITDA1 was driven by the decrease in income from mine operations, higher payments made to mining
contractors and a $2.9 million realized loss on gold hedging instruments.
Total cash costs 1 in Q2 2024 amounted to $1,271/oz compared to $1,127/oz in Q2 2023. The increase in total
cash costs1 was primarily driven by lower gold sales volumes, which decreased by 15% in Q2 2024 and had the
effect of increasing fixed costs on a per ounce basis. Additionally, operational waste stripping costs at Abore
contributed to the higher total cash costs 1 in Q2 2024.
AISC1 for Q2 2024 was $1,759/oz compared to $1,374/oz in the comparative period. AISC 1 was higher in the
current quarter predominately due to the increase in total cash costs per ounce 1 described above, 15% fewer
(All amounts in 000's of US dollars, unless otherwise stated) 2024 2023 2024 2023
Asanko Gold Mine (100% basis)
Financial results
Revenue 63,963 64,066 129,565 129,259
Income from mi ne operations 23,071 24,406 46,567 49,063
Net income 13,945 24,378 28,402 44,992
Adjus ted EBITDA
1
19,279 25,541 40,792 48,404
Cas h generated from operating activi ti es 9,231 17,979 35,336 36,922
Free cas h flow
1
(4,509) 10,113 1,304 22,072
AISC margin ($ per gold ounce s old)
1
533 570 389 577
Operating results
Gold produced (ounces ) 26,437 33,673 56,823 66,351
Gold s old (ounces ) 27,830 32,912 59,670 68,086
Avera ge rea l ized gold price ($/oz) 2,292 1,944 2,166 1,896
Tota l cas h cos ts ($ per gol d ounce s old)
1
1,271 1,127 1,222 1,104
AISC ($ per gold ounce s ol d)
1
1,759 1,374 1,777 1,319
Three months ended June 30, Six months ended June 30,
5
gold ounces sold and higher capitalized stripping costs at Abore. Additionally, payments to mining services
contractors were $146/oz higher in Q2 2024.
The AGM generated $9.2 million of cash flow from operating activities and free cash flow 1 of negative $4.5
million during Q2 2024. This compares to $18.0 million of cash flow from operating activities and free cash flow1
of $10.1 million during Q2 2023. The decrease in free cash flow 1 was primarily due to investments in waste
stripping at the expanded Abore deposit, partly offset by higher realized gold prices during Q2 2024.
Abore Mineral Reserve Estimate as of June 30, 2024
Proven Probable Proven + Probable
Tonnes Grade Au
Contained Tonnes Grade Au
Contained Tonnes Grade Au
Contained
Deposit (Mt) (g/t) (koz) (Mt) (g/t) (koz) (Mt) (g/t) (koz)
Abore - - - 11.8 1.28 485 11.8 1.28 485
Notes on Abore Mineral Reserve Estimate:
Mr. Richard Miller, P.Eng., Vice President Technical Services for Galiano Gold Inc., is the Qualified Person
responsible for the Abore Mineral Reserve statement.
Refer to the Company’s news release dated April 16, 2024 for Abore’s Mineral Resource Estimate as of March
31, 2024.
Abore Mineral Reserves are reported assuming a gold price of US$1,650/oz Au.
Abore Mineral Reserves are reported at 0.50 g/t Au cut-off.
The overall strip ratio (the amount of waste mined for each tonne of ore) is 7.2:1.
Processing recovery is 0.10 g/t tails grade and capped at 94.0%.
The average mining dilution is calculated to be 6.9%.
A 6.8% ore loss has been applied to the Mineral Reserve estimate.
The Mineral Reserve is stated as diluted dry metric tonnes.
All other Mineral Reserves of the AGM remain as previously stated, except stockpiles which have been
restated for depletion.
The increase to the Abore Mineral Reserve estimate is not considered a material change to Galiano.
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Galiano Gold Inc. – Financial highlights for the three and six months ended June 30, 2024 and 2023
The Company consolidated the financial results of the AGM commencing on March 4, 2024. As revenue and
income from mine operations for the three and six months ended June 30, 2024 relate to the financial results
of the AGM, refer to the discussion above on the AGM’s financial results for the quarter.
The Company reported net income of $8.8 million in Q2 2024 compared to net income of $12.0 million in Q2
2023. The decrease in net earnings during Q2 2024 was due to a $2.1 million increase in share-based
compensation expense resulting from an increase in the fair value of cash-settled long-term incentive plan
awards linked to the Company’s share price, and $1.4 million in accretion expense and fair value adjustments
on the deferred and contingent consideration payable to Gold Fields associated with the Company’s acquisition
of Gold Fields’ 45% interest in the AGM.
Adjusted EBITDA1 for Q2 2024 amounted to $17.6 million, compared to $9.6 million in Q2 2023. The increase in
Adjusted EBITDA 1 was due to consolidating the financial results of the AGM from March 4, 2024 onwards;
whereas, in the prior quarter the Company only recognized its 45% share of the AGM’s Adjusted EBITDA 1.
Cash generated from operating activities in Q2 2024 was $4.5 million, compared to cash used in operating
activities of $1.4 million in Q2 2023. The increase in cash generated from operating activities in Q2 2024 was
driven by the consolidation of the AGM’s cash flows effective March 4, 2024.
As of June 30, 2024, the Company had cash and cash equivalents of $123.0 million and no debt.
This news release should be read in conjunction with Galiano’s Management’s Discussion and Analysis and the
Unaudited Condensed Consolidated Interim Financial Statements for the three and six months ended June 30,
2024 and 2023, which are available at www.galianogold.com and filed on SEDAR+.
1 Non-IFRS Performance Measures
The Company has included certain non-IFRS performance measures in this news release. These non-IFRS
performance measures do not have any standardized meaning and therefore may not be comparable to similar
measures presented by other issuers. Accordingly, these performance measures are 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. Refer to the Non-IFRS Measures section of Galiano’s Management’s Discussion and Analysis
for an explanation of these measures and reconciliations to the Company’s and the AGM’s reported financial results
(All amounts in 000's of US dollars, unless otherwise stated) 2024 2023 2024 2023
Galiano Gold Inc.
Revenue 63,963 - 95,658 -
Income from mine operations 25,132 - 29,778 -
Net income 8,831 11,961 4,072 20,454
Net income per s hare attributable to
common s hareholders
1 0.03 0.05 0.02 0.09
Adjus ted net i ncome
1
7,264 11,961 13,757 20,454
Adjus ted net i ncome per s hare attri buta ble to
common s hareholders
1 0.03 0.05 0.06 0.09
Adjus ted EBITDA
1
17,598 9,634 21,105 16,374
Cas h and cas h equi val ents 123,039 55,503 123,039 55,503
Cas h generated from (used i n) opera ti ng activi ti es 4,463 (1,377) 17,491 (1,920)
Three months ended June 30, Six months ended June 30,
7
in accordance with IFRS.
Total Cash Costs per Gold Ounce
Management of the Company uses total cash costs per gold ounce sold to monitor the operating performance
of the AGM. Total cash costs include the cost of production, adjusted for share-based compensation expense,
by-product revenue and production royalties per ounce of gold sold.
All-in Sustaining Costs per Gold Ounce and All-in Sustaining Margin
The Company has adopted the reporting of “AISC per gold ounce sold” as per the World Gold Council’s guidance.
AISC include total cash costs, AGM general and administrative expenses, sustaining capital expenditure,
sustaining capitalized stripping costs, reclamation cost accretion and lease payments made to and interest
expense on the AGM’s mining and service lease agreements per ounce of gold sold. All-in sustaining margin is
calculated by taking the average realized gold price for a period less that period’s AISC.
EBITDA and Adjusted EBITDA
EBITDA provides an indication of the Company’s continuing capacity to generate income from operations before
taking into account the Company’s financing decisions and costs of amortizing capital assets. Accordingly, EBITDA
comprises net income excluding interest expense, interest income, amortization and depletion, and income
taxes. Adjusted EBITDA adjusts EBITDA to exclude non-recurring items and to include the Company’s interest in
the Adjusted EBITDA of the AGM joint venture for the period from January 1, 2024 to March 3, 2024. Other
companies may calculate EBITDA and Adjusted EBITDA differently.
Free cash flow
The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company
and certain investors and analysts use free cash flow to evaluate the AGM’s performance with respect to its
operating cash flow capacity to meet non-discretionary outflows of cash. The presentation of free cash flow is
not meant to be a substitute for the cash flow information presented in accordance with IFRS, but rather should
be evaluated in conjunction with such IFRS measures. Free cash flow is calculated as cash flows from operating
activities of the AGM adjusted for cash flows associated with sustaining and non-sustaining capital expenditures
and payments made to mining and service contractors for leases capitalized under IFRS 16.
Adjusted net income and adjusted net income per common share
The Company has included the non-IFRS performance measures of adjusted net income and adjusted net income
per common share. Neither adjusted net income nor adjusted net income per share have any standardized
meaning and are therefore unlikely to be comparable to other measures presented by other issuers. Adjusted
net income excludes certain non-cash items or non-recurring items from net income or net loss to provide a
measure which helps the Company and investors to evaluate the results of the underlying core operations of the
Company or the AGM and its ability to generate cash flows and is an important indicator of the strength of the
Company’s or the AGM’s operations and performance of its core business.
Qualified Person
Richard Miller, P.Eng., Vice President Technical Services with Galiano, is a Qualified Person as defined by Canadian
National Instrument 43-101, Standards of Disclosure for Mineral Projects, and has approved the scientific and
technical information contained in this news release.
About Galiano Gold Inc.
Galiano is focused on creating a sustainable business capable of value creation for all stakeholders through
production, exploration and disciplined deployment of its financial resources. The Company owns the Asanko Gold
Mine, which is located in Ghana, West Africa. Galiano is committed to the highest standards for environmental
management, social responsibility, and the health and safety of its employees and neighbouring communities. For
more information, please visit www.galianogold.com.
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Contact Information
Krista Muhr
Toll-Free (N. America): 1-855-246-7341
Telephone: 1-778-239-0446
Email: [email protected]
Cautionary Note Regarding Forward-Looking Statements
Certain statements and information contained in this news release constitute “forward-looking statements” within
the meaning of applicable U.S. securities laws and “forward-looking information” within the meaning of applicable
Canadian securities laws, which we refer to collectively as “forward-looking statements”. Forward-looking
statements are statements and information regarding possible events, conditions or results of operations that are
based upon assumptions about future conditions and courses of action. All statements and information other than
statements of historical fact may be forward-looking statements. In some cases, forward-looking statements can be
identified by the use of words such as “seek”, “expect”, “anticipate”, “budget”, “plan”, “estimate”, “continue”,
“forecast”, “intend”, “believe”, “predict”, “potential”, “target”, “may”, “could”, “would”, “might”, “will” and similar
words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook.
Forward-looking statements in this news release include, but are not limited to: statements regarding the Company’s
operating plans for the AGM and timing thereof; expectations and timing with respect to current and planned drilling
programs, including at Abore, and the results thereof; advancement toward a maiden Mineral Reserve estimate at
Midras South; anticipated production and cost guidance; timing of delivery of higher grade ore from the Abore pit;
the Company’s plans to update a consolidated Mineral Reserve Estimate and life of mine plan; any additional work
programs to be undertaken by the Company; potential exploration opportunities and statements regarding the
usefulness and comparability of certain non-IFRS measures; and total cash costs and corresponding cost performance
relating to the Company’s activities. Such forward-looking statements are based on a number of material factors and
assumptions, including, but not limited to: development plans and capital expenditures; the price of gold will not
decline significantly or for a protracted period of time; the accuracy of the estimates and assumptions underlying
mineral reserve and mineral resource estimates; the Company’s ability to raise sufficient funds from future equity
financings to support its operations, and general business and economic conditions; the global financial markets and
general economic conditions will be stable and prosperous in the future; the ability of the Company to comply with
applicable governmental regulations and standards; the mining laws, tax laws and other laws in Ghana applicable
to the AGM will not change, and there will be no imposition of additional exchange controls in Ghana; the success of
the Company in implementing its development strategies and achieving its business objectives; the Company will
have sufficient working capital necessary to sustain its operations on an ongoing basis and the Company will continue
to have sufficient working capital to fund its operations; and the key personnel of the Company will continue their
employment.
The foregoing list of assumptions cannot be considered exhaustive.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause
actual results, performance or achievements to differ materially from those anticipated in such forward-looking
statements. The Company believes the expectations reflected in such forward-looking statements are reasonable,
but no assurance can be given that these expectations will prove to be correct and you are cautioned not to place
undue reliance on forward-looking statements contained herein. Some of the risks and other factors which could
cause actual results to differ materially from those expressed in the forward-looking statements contained in this
news release, include, but are not limited to: mineral reserve and mineral resource estimates may change and may
prove to be inaccurate; metallurgical recoveries may not be economically viable; life of mine estimates are based on
a number of factors and assumptions and may prove to be incorrect; risks related to the expected benefits of the
Acquisition; actual production, costs, returns and other economic and financial performance may vary from the
Company's estimates in response to a variety of factors, many of which are not within the Company's control;
inflationary pressures and the effects thereof; the AGM has a limited operating history and is subject to risks