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Kinross reports 2015 first quarter results

May 5, 2015

All-in sustaining cost and production cost of sales lower quarter-over-quarter and year-over-year

On track to meet Company-wide and regional production guidance

Toronto, Ontario - May 5, 2015 - Kinross Gold Corporation (TSX: K, NYSE: KGC) today announced its results for the first quarter ended March 31, 2015.

(This news release contains forward-looking information about expected future events and financial and operating performance of the Company. We refer to the risks and assumptions set out in our Cautionary Statement on Forward-Looking Information located on page 17 of this release. All dollar amounts are expressed in U.S. dollars, unless otherwise noted.)

2015 first quarter highlights:

  • Production(1): 629,360 gold equivalent ounces (Au eq. oz.), compared with 664,690 ounces in Q1 2014.
  • Revenue: $781.4 million, compared with $817.4 million in Q1 2014.
  • Production cost of sales(2): $709 per Au eq. oz., compared with $727 in Q1 2014.
  • All-in sustaining cost(2): $964 per Au eq. oz. sold, compared with $1,001 in Q1 2014. All-in sustaining cost per gold ounce (Au oz.) sold on a by-product basis was $957 in Q1 2015, compared with $991 in Q1 2014.
  • Adjusted operating cash flow(2,3): $214.8 million, or $0.19 per share, compared with $242.2 million, or $0.21 per share, in Q1 2014.
  • Adjusted net earnings(2,3): $15.3 million, or $0.01 per share, compared with adjusted earnings of $34.1 million, or $0.03 per share, in Q1 2014.
  • Reported net earnings/loss: Loss of $6.7 million, or $0.01 per share, compared with earnings of $31.8 million, or $0.03 per share, in Q1 2014.
  • Outlook: Kinross expects to be within its 2015 forecast guidance for production (2.4 - 2.6 million Au eq. oz.), production cost of sales ($720 - $780 per Au eq. oz.), all-in sustaining cost ($1,000 - $1,100 per Au eq. oz.) and total capital expenditures ($725 million).
  • Organic production initiatives: A pre-feasibility study to explore potential re-start options at La Coipa remains on track to be completed during Q3 2015. A new tailings reprocessing project at Paracatu, set to launch in Q4 2015, is expected to produce an additional 34,000 Au oz. per year at a production cost of sales of $400 per ounce for a minimum of nine years. The Company is also planning to extend Chirano's estimated mine life by one year to 2020. This will provide additional time to pursue exploration potential in this highly prospective and low-cost area.
  • Maricunga update: Mining and crushing operations are expected to restart in June with the support of an additional backup power plant after operations were suspended in late March due to heavy rains in northern Chile. The loss in production is expected to be largely offset by improved production forecasts at Paracatu. As a result, Kinross expects no change to its regional guidance.

CEO Commentary

J. Paul Rollinson, President and CEO, made the following comments in relation to 2015 first quarter results:

"Kinross followed up its strong performance in 2014 with a solid start to 2015. The Company is firmly on track to meet production guidance for the year and is tracking below guidance on both cost of sales and all-in sustaining cost. Lower power costs and favourable foreign exchange rates contributed to a continued decline in Paracatu's cost of sales, while at the combined Kupol-Dvoinoye operations, cost of sales declined to $476 dollars per ounce - the lowest level since Q4 2012.

"In addition to another strong quarter, I am pleased that we are moving forward with two new organic production initiatives. Tailings reprocessing is an established technology and the Santo Antonio project at Paracatu is expected to quickly begin generating cash flow with the addition of low-cost ounces. Chirano's life of mine extension allows Kinross greater scope to develop exploration targets in what is a highly prospective and low-cost area.

"As for Maricunga, it has been a challenging time for the site after heavy rains forced the temporary suspension of mining and crushing operations in late March. The team has done an outstanding job, working around the clock to establish alternate routes to the mine and deploy backup power supply. Operations are expected to restart in June, with no anticipated change to regional guidance."

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(1) Unless otherwise stated, production figures in this news release are based on Kinross' 90% share of Chirano production.

(2) These figures are non-GAAP financial measures and are defined and reconciled on pages 12 to 16 of this news release.

(3) Net earnings/loss figures in this release represent "net earnings (loss) from continuing operations attributable to common shareholders".

Cautionary Statement on Forward-Looking Information
All statements, other than statements of historical fact, contained or incorporated by reference in this news release including, but not limited to, any information as to the future financial or operating performance of Kinross, constitute ‘‘forward-looking information’’ or ‘‘forward-looking statements’’ within the meaning of certain securities laws, including the provisions of the Securities Act (Ontario) and the provisions for ‘‘safe harbour’’ under the United States Private Securities Litigation Reform Act of 1995 and are based on expectations, estimates and projections as of the date of this news release. Forward-looking statements contained in this news release, include, but are not limited to, those under the headings “Outlook”, “Organic production initiatives”, “Maricunga update”, “CEO Commentary”, “La Coipa Phase 7 update”, “Liquidity”, and “Class action lawsuits update” and include, without limitation, statements with respect to our guidance for production; production costs of sales, all-in sustaining cost and capital expenditures; and continuous improvement initiatives, as well as references to other possible events, the future price of gold and silver, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of projects and new deposits, success of exploration, development and mining activities, currency fluctuations, capital requirements, project studies, mine life extensions, restarting suspended operations; continuous improvement initiatives; and resolution of pending litigation. The words “anticipate”, “believe”, “estimates”, ‘‘expects’’, ‘‘forecasts”, “focus”, “guidance”, “indicate”, “initiative”, “on track”, “options”, “outlook”, “opportunity”, “plan”, “possible”, “potential”, “priority”, “prospect”, “pursue”, “study” or “target”, or variations of or similar such words and phrases or statements that certain actions, events or results may, could, should or ‘will be achieved, received or taken, or will occur or result and similar such expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Kinross as of the date of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The estimates, models and assumptions of Kinross referenced, contained or incorporated by reference in this news release, which may prove to be incorrect, include, but are not limited to, the various assumptions set forth herein and in our most recently filed Annual Information Form and our Management’s Discussion and Analysis as well as: (1) there being no significant disruptions affecting the operations of the Company whether due to extreme weather events and other or related natural disasters, labour disruptions, supply disruptions, power disruptions, damage to equipment or otherwise, including but not limited to the recent extreme weather, and related flash floods and mudslides, impacting the Company’s Maricunga mine and required remediation being consistent with the Company’s expectations; (2) permitting, development and operations at Paracatu (including, without limitation, land acquisitions and permitting for the construction and operation of the new tailings facility, power supply and launch of the new tailings reprocessing facility) being consistent with our current expectations;(3) political and legal developments in any jurisdiction in which the Company operates being consistent with its current expectations including, without limitation, the impact of escalating political tensions and uncertainty in the Russian Federation and Ukraine or any related sanctions and any other similar restrictions or penalties imposed, or actions taken, by any government, including but not limited to potential power rationing in Brazil and potential amendments to the Brazilian Mining Code, the Chilean Water Code, and/or other water use restrictions in Chile, the Minerals and Mining Act (2006) and dam safety regulation in Ghana, the Customs Code, the Mining Code, (including but not limited amendments to the VAT regime pursuant to the 2015 Budget Law) in Mauritania and Tax Code in Russia (including, but not limited to, the interpretation, implementation and application of any such amendments), being consistent with Kinross’ current expectations; (4) the exchange rate between the Canadian dollar, Brazilian real, Chilean peso, Russian rouble, Mauritanian ouguiya, Ghanaian cedi and the U.S. dollar being approximately consistent with current levels; (5) certain price assumptions for gold and silver; (6) prices for diesel, natural gas, fuel oil, electricity and other key supplies being approximately consistent with current levels; (7) production and cost of sales forecasts for the Company meeting expectations; (8) the accuracy of the current mineral reserve and mineral resource estimates of the Company (including but not limited to ore tonnage and ore grade estimates); (9) labour and materials costs increasing on a basis consistent with Kinross’ current expectations; (10) the development of, operations at and production from the Company’s operations, being consistent with Kinross’ current expectations; (11) the terms and conditions of the legal and fiscal stability agreements for the Tasiast and Chirano operations being interpreted and applied in a manner consistent with their intent and Kinross’ expectations; (12) goodwill and/or asset impairment potential; and (13) access to capital markets, including but not limited to maintaining an investment grade debt rating and, as required, maintaining partial project financing for Dvoinoye and Kupol being consistent with the Company’s current expectations. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to: sanctions (any other similar restrictions or penalties) now or subsequently imposed, other actions taken, by, against, in respect of or otherwise impacting any jurisdiction in which the Company is domiciled or operates (including but not limited to the Russian Federation, Canada, the European Union and the United States), or any government or citizens of, persons or companies domiciled in, or the Company’s business, operations or other activities in, any such jurisdiction; litigation commenced, or other claims or actions brought, against the Company (and/or any of its directors, officers or employees) in respect of the cessation by the Company of investment in and development of FDN and its sale, or any of the Company’s prior activities on or in respect thereof or otherwise in Ecuador; fluctuations in the currency markets; fluctuations in the spot and forward price of gold or certain other commodities (such as fuel and electricity); changes in the discount rates applied to calculate the present value of net future cash flows based on country-specific real weighted average cost of capital; changes in the market valuations of peer group gold producers and the Company, and the resulting impact on market price to net asset value multiples;changes in various market variables, such as interest rates, foreign exchange rates, gold or silver prices and lease rates, or global fuel prices, that could impact the mark-to-market value of outstanding derivative instruments and ongoing payments/receipts under any financial obligations; risks arising from holding derivative instruments (such as credit risk, market liquidity risk and mark-to-market risk); changes in national and local government legislation, taxation (including but not limited to income tax, advance income tax, stamp tax, withholding tax, capital tax, tariffs, value-added or sales tax, capital outflow tax, capital gains tax, windfall or windfall profits tax, royalty, excise tax, customs/import or export taxes/duties, asset taxes, asset transfer tax, property use or other real estate tax, together with any related fine, penalty, surcharge, or interest imposed in connection with such taxes), controls, policies and regulations; the security of personnel and assets; political or economic developments in Canada, the United States, Chile, Brazil, Russia, Ecuador, Mauritania, Ghana, or other countries in which Kinross does business or may carry on business; business opportunities that may be presented to, or pursued by, us; our ability to successfully integrate acquisitions and complete divestitures; operating or technical difficulties in connection with mining or development activities; employee relations; litigation or other claims against, or regulatory investigations and/or any enforcement actions or sanctions in respect of the Company (and/or its directors, officers, or employees) including, but not limited to, securities class action litigation in Canada and/or the United States, or any investigations, enforcement actions and/or sanctions under any applicable anti-corruption, international sanctions and/or anti-money laundering laws and regulations in Canada, the United States or any other applicable jurisdiction; the speculative nature of gold exploration and development including, but not limited to, the risks of obtaining necessary licenses and permits; diminishing quantities or grades of reserves; adverse changes in our credit rating; and contests over title to properties, particularly title to undeveloped properties. In addition, there are risks and hazards associated with the business of gold exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance, or the inability to obtain insurance, to cover these risks). Many of these uncertainties and contingencies can directly or indirectly affect, and could cause, Kinross’ actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Kinross, including but not limited to resulting in an impairment charge on goodwill and/or assets. 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. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. All of the forward-looking statements made in this news release are qualified by these cautionary statements and those made in our other filings with the securities regulators of Canada and the United States including, but not limited to, the cautionary statements made in the ‘‘Risk Factors’’ section of our most recently filed Annual Information Form and the “Risk Analysis” section of our Full year 2014 and Q1, 2015 Management Discussion and Analysis. These factors are not intended to represent a complete list of the factors that could affect Kinross. Kinross disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law.

Key Sensitivities

Approximately 60%-70% of the Company's costs are denominated in US dollars.
A 10% change in foreign currency exchange rates would be expected to result in an approximate $14 impact on production cost of sales per ounce .
Specific to the Russian rouble, a 10% change in the exchange rate would be expected to result in an approximate $11 impact on Russian production cost of sales per ounce.
A $10 per barrel change in the price of oil would be expected to result in an approximate $1 impact on production cost of sales per ounce.
A $100 change in the price of gold would be expected to result in an approximate $3 impact on production cost of sales per ounce as a result of a change in royalties.

Other information
Where we say ‘‘we’’, ‘‘us’’, ‘‘our’’, the ‘‘Company’’, or ‘‘Kinross’’ in this news release, we mean Kinross Gold Corporation and/or one or more or all of its subsidiaries, as may be applicable.
The technical information about the Company’s mineral properties (other than exploration activities) contained in this news release has been prepared under the supervision of Mr. John Sims, an officer of the Company who is a “qualified person” within the meaning of National Instrument 43-101 (“NI 43-101”). The technical information about the Company’s exploration activities contained in this news release has been prepared under the supervision of Mr. Sylvain Guerard, an officer of the Company who is a “qualified person” within the meaning of NI 43-101.

About Kinross

Kinross is a Canadian-based senior gold mining company with mines and projects in the United States, Brazil, Russia, Mauritania, Chile and Ghana. Kinross maintains listings on the Toronto Stock Exchange (symbol:K) and the New York Stock Exchange (symbol:KGC).

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Andrea Mandel-Campbell
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phone: 647-788-4179

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Tom Elliott
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phone: 416-365-3390