Santa Fe Gold Reports 49% Increase in Revenues to $14.6 Million for 2013

Santa Fe Gold Corp. (OTCBB: SFEG) today announced financial results for its fiscal year ended June 30, 2013. Santa Fe Gold reported revenues of $14.6 million for the year ended June 30, 2013, which represents an increase of 49% over 2012. The Company's gross profit (or earnings from mining operations) decreased by 32% to $2.4 million in 2013. The full version of the financial statements and management's discussion and analysis can be viewed on the Company's website at www.santafegoldcorp.com or at www.sec.gov.

"We are pleased to be able to announce continued significant growth in revenues and continued positive earnings from mining operations despite lower metal prices," commented Pierce Carson, President and CEO. "We also are excited about our growth prospects for 2014. The recent developments at Summit are expected to contribute to higher grades and increased production in 2014."


2012 ANNUAL HIGHLIGHTS

• 49% increase in revenues to a record $14.6 million.
• 32% decrease in gross profit (earnings from mining operations) to $2.4 million.

OUTLOOK

For 2014, the Company expects to experience continued growth, in part due to the following positive developments:

• Underground advancement has reached the upper part of the main Summit ore body. As a result, the Company is now in a position to access higher silver and gold grades.


• Discussions are underway with mining contractors to increase tonnage production rates to 12,000 tons per month. Metal output in calendar 2014 is anticipated to increase substantially with increased tonnage production and higher grades from the main ore body.


• An independent engineering assessment of the Ortiz gold project concludes the project could produce 874,000 ounces of gold from two open cut mines over an operating life ranging from 9 to 18 years depending on the development sequence employed. At a three-year moving average gold price of $1550 per ounce, revenues would total $1.35 billion and cash flows would approximate $350 million net of all costs including royalties, operating costs, taxes and capital expenses. Baseline environmental work is continuing in preparation for permit application.

About Santa Fe Gold

Santa Fe Gold is a U.S.-based mining enterprise with producing mining operations in Lordsburg, New Mexico, and exploration and development projects in southwestern New Mexico, north-central New Mexico and Arizona. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began commercial production in 2012; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Mogollon gold-silver project, within trucking distance of the Lordsburg mill; (iv) the Ortiz gold property in north-central New Mexico; (v) the Black Canyon mica deposit near Phoenix, Arizona; and (vi) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.

To learn more about Santa Fe Gold, visit www.santafegoldcorp.com.


Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable US securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, the Company's inability to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Company’s Annual Report on Form 10-K for the year ended June 30, 2012 and its most recent quarterly reports filed with the United States Securities and Exchange Commission (the “SEC”), and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company's US public disclosure filings may be accessed via www.sec.gov and readers are urged to review these materials.


See Accompanying Tables

The following information summarizes the financial condition of Santa Fe Gold Corp. at June 30, 2013, including its balance sheets for the twelve months ended June 30, 2013 and 2012, respectively, and its results of operations and cash flows for the twelve months ended June 30, 2013, 2012 and 2011, respectively. The summary data are taken from our audited financial statements contained in our annual reports on Form 10-K for the financial years ended June 30, 2013, 2012 and 2011 but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company’s Form 10-K in its entirety, which can be found on the SEC’s website at www.sec.gov.

SANTA FE GOLD CORPORATION
CONSOLIDATED BALANCE SHEETS
					June 30,
ASSETS					2013					2012
CURRENT ASSETS:
Cash and cash equivalents				$	115,094				$	614,385
Accounts receivable					273,797					2,442,399
Inventory					241,214					951,458
Marketable securities					-					48,776
Prepaid expenses and other current assets					457,377					329,466
Total Current Assets					1,087,482					4,386,484
MINERAL PROPERTIES					599,897					579,000
PROPERTY, EQUIPMENT AND MINE DEVELOPMENT, net					21,726,196					24,139,166
OTHER ASSETS:
Idle equipment, net					1,223,528					1,223,528
Restricted cash					231,716					231,716
Mogollon option costs					761,914					-
Deferred financing costs, net					323,348					1,102,070
Total Other Assets					2,540,506					2,557,314
Total Assets				$	25,954,081				$	31,661,964
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable				$	2,748,549				$	2,199,026
Accrued liabilities					4,606,409					2,505,785
Derivative instrument liabilities					496,920					1,026,765
Current portion, notes payable					7,185,877					9,931,468
Current portion, Senior subordinated convertible notes payable, net of discount of $-0- and $5,564, respectively					-					444,436
Current portion, capital leases					-					41,487
Completion guarantee payable					3,359,873					3,359,873
Total Current Liabilities					18,397,628					19,508,840
LONG TERM LIABILITIES:
Convertible notes payable, net of discount of $60,482 and $-0-, respectively					3,951,310					-
Notes payable, net of current portion					330,192					936,996
Capital leases, net of current portion					-					3,545
Asset retirement obligation					167,746					159,048
Total Liabilities					22,846,876					20,608,429
STOCKHOLDERS' EQUITY:
Common stock, $.002 par value, 300,000,000 shares authorized; 117,599,598 and 111,143,684 shares issued and outstanding, respectively					235,199					222,287
Additional paid in capital					77,210,649					74,846,754
Accumulated (deficit)					(74,338,643	)				(63,966,224	)
Accumulated other comprehensive (loss)					-					(49,282	)
Total Stockholders' Equity					3,107,205					11,053,535
Total Liabilities and Equity				$	25,954,081				$	31,661,964

SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS)
					For the Years Ended June 30,
					2013					2012					2011
SALES, Net				$	14,571,973				$	9,762,054				$	5,904,640
OPERATING COSTS AND EXPENSES:
Costs applicable to sales					12,185,244					6,274,033					3,180,105
Exploration and mine related costs					2,012,785					371,584					309,399
General and administrative					3,998,392					3,710,921					3,002,955
Depreciation and amortization					4,149,034					4,039,875					2,322,736
Accretion of asset retirement obligation					8,698					9,812					-
					22,354,153					14,406,225					8,815,195
LOSS FROM OPERATIONS					(7,782,180	)				(4,644,171	)				(2,910,555	)
OTHER INCOME (EXPENSE):
Interest income					-					9,108					11,645
Foreign currency translation					440,449					-					-
Miscellaneous income					23,608					5,328					-
Other expense					-					(1,245,694	)				-
Gain on derivative instrument liabilities					1,617,987					6,568,533					1,652,961
Accretion of discounts on notes payable					(21,918	)				(1,066,843	)				(1,275,811	)
Financing costs - commodity supply agreements					(2,008,730	)				(1,709,472	)				(1,260,257	)
Interest expense					(2,641,635	)				(2,136,470	)				(835,076	)
					(2,590,239	)				424,490					(1,706,538	)
LOSS BEFORE PROVISION FOR INCOME TAXES					(10,372,419	)				(4,219,681	)				(4,617,093	)
PROVISION FOR INCOME TAXES					-					-					-
NET LOSS					(10,372,419	)				(4,219,681	)				(4,617,093	)
OTHER COMPREHENSIVE LOSS
Unrealized loss on marketable securities					-					(48,484	)				(798	)
NET COMPREHENSIVE LOSS				$	(10,372,419	)			$	(4,268,165	)			$	(4,617,891	)
Basic and Diluted Per Share data
Net Loss - basic and diluted				$	(0.09	)			$	(0.04	)			$	(0.05	)
Weighted Average Common Shares Outstanding: Basic and diluted					116,750,573					101,959,367					93,249,081

SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
					For the Years Ended June 30,
					2013					2012					2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss				$	(10,372,419	)			$	(4,219,681	)			$	(4,617,093	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization					4,149,034					4,039,875					2,322,736
Stock-based compensation					1,514,852					926,727					1,010,081
Accretion of discount on notes payable					21,918					1,066,843					1,275,811
Accretion of asset retirement obligation					8,698					9,812					-
Write-off note receivable					-					210,889					-
(Gain) on derivative instrument liabilities					(1,617,987	)				(6,568,533	)				(1,652,961	)
Loss on disposal of assets					-					152,587					-
Loss on disposition of marketable securities					86,144					-					-
Amortization of deferred financing costs					778,722					882,629					98,317
Foreign currency translation					(440,449	)				-					-
Net change in operating assets and liabilities:
Accounts receivable					2,168,602					(211,794	)				(2,230,605	)
Inventory					710,244					(775,880	)				(175,578	)
Prepaid expenses and other current assets					(127,911	)				54,719					(11,856	)
Mogollon option costs					(750,000	)				-					-
Accounts payable and accrued liabilities					2,667,388					1,382,044					2,523,580
Sandstorm upfront deposit					-					(755,442	)				(388,734	)
Completion guarantee payable					-					504,049					-
Net Cash Used in Operating Activities					(1,203,164	)				(3,301,156	)				(1,846,302	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease to restricted cash					-					178,658					-
Proceeds from disposal of assets					-					25,000					-
Purchase of marketable securities					-					-					(98,058	)
Notes receivable					-					(7,467	)				(203,422	)
Additions of property, equipment and mine development					(1,756,961	)				(1,826,306	)				(1,156,276	)
Construction in progress					-					(4,208,960	)				(3,665,034	)
Net Cash Used in Investing Activities					(1,756,961	)				(5,839,075	)				(5,122,790	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of stock					1,873,261					1,200,000					2,000,001
Proceeds from notes payable					136,058					15,000,000					77,306
Proceeds from convertible notes payable					3,985,000					-					-
Payments of private placement fees					-					-					(136,000	)
Payments on notes payable					(3,488,453	)				(5,164,034	)				(201,701	)
Payments on capital leases					(45,032	)				(83,881	)				(138,113	)
Payments of financing costs					-					(1,370,000	)				-
Net Cash Provided by Financing Activities					2,460,834					9,582,085					1,601,493
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS					(499,291	)				441,854					(5,367,599	)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR					614,385					172,531					5,540,130
CASH AND CASH EQUIVALENTS, END OF YEAR				$	115,094				$	614,385				$	172,531

SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued)
					For the Years Ended June 30,
					2013					2012					2011
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest				$	797,237				$	1,482,441				$	799,354
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Stock issued for cashless exercise of warrants				$	22,501				$	-				$	-
Stock issued for cashless exercise of options				$	-				$	11				$	203
Stock issued for conversion of convertible notes payable				$	-				$	13,432,424				$	-
Equipment purchased with notes payable				$	-				$	790,035				$	-

Contact

Santa Fe Gold Corp.
Pierce Carson, President and Chief Executive Officer
505-255-4852