Richmont Mines Reports Strong Second Quarter Financial Results Driven by Solid Operational and Record Cost Performance from the Island Gold Mine; Reports Net Free Cash Flow of $19.2 (US$14.3) Million

TORONTO, Aug. 3, 2017

Second Quarter Highlights

• Company-wide production was 31,249 ounces of gold (35,040 ounces sold) for the quarter, primarily driven by solid production from the Island Gold Mine of 26,110 ounces of gold (29,534 ounces sold).
• Company-wide cash costs¹ for the quarter were $725 (US$539) per ounce, positively impacted by record low cash costs from the Island Gold Mine of $580 (US$431) per ounce.
• Company-wide All-In-Sustaining Costs¹ ("AISC") of $957 (US$711) per ounce, positively impacted by record low AISC of $677 (US$503) per ounce from the Island Gold Mine.
• The Island Gold Mine remains on-track to meet, or beat, annual production and cost guidance.
• Second quarter revenues of $59.3 (US$44.1) million.
• Earnings of $10.5 (US$7.8) million, or $0.17 (US$0.12) per share.
• Operating cash flow¹ (before changes in non-cash working capital) was $24.9 (US$18.5) million, or $0.39 (US$0.29) per share.
• Net free cash flow¹ was $19.2 (US$14.3) million, or $0.30 (US$0.22) per share.
• Cash balance at the end of the quarter increased to $95.9 (US$73.9) million, an increase of $20.7 (US$15.4) million over the first quarter; working capital increased to $81.4 (US$62.7) million.
• The results of the Expansion Case Preliminary Economic Assessment ("PEA") were released during the second quarter, supporting strong production growth of 22% at low industry cash costs and a robust cash flow stream over an initial eight-year Phase 1 period. The ramp-up is currently advancing and the mill is anticipated to achieve the target run rate of 1,100 tonnes per day in the latter part of 2018 once the expansion is completed.
• On July 27, 2017 the Corporation provided an update from its strategic exploration drilling program currently underway at the Island Gold Mine. Recent exploration drilling has intersected high-grade, wide mineralization in the down plunge extension of the main Island Gold deposit with Hole MH8-4 intersecting 19.85 g/t gold over 8.4 metres (true width and assays capped at 70 g/t gold).

"The positive results for the quarter were supported by another consecutive quarter of solid production and record low cash costs reported from our cornerstone Island Gold Mine. This strong operational and cost performance drove robust cash flow streams even during a period of accelerated investment in our strategic expansion and exploration programs at Island Gold," stated Renaud Adams, CEO. He continued, "Company-wide, our focus remains on creating sustainable shareholder value by driving ongoing operational and cost efficiencies throughout the organization and maintaining our disciplined approach to capital allocation. Over the balance of the year, we will continue to focus on further unlocking the potential of the Island Gold Mine as we position the operation to be one of the lowest cost producers in the Americas."

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¹ Non-IFRS performance measure. Refer to the Non-IFRS Performance Measures contained in the Q2 2017 Management's Discussion and Analysis.