Sabina Gold & Silver Announces Q1 2014 Financial Results

$51 million at March 31, 2014 in cash and equivalents

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 14, 2014) - Sabina Gold & Silver Corp. (the "Company") (TSX:SBB) reported today the financial results for the quarter ended March 31, 2014.

2014 got off to a good start in the first quarter. Highlights of the period include:

• The Company had cash, cash equivalents and short-term investments of $51.4 million at March 31, 2014.
  
  
• On January 23, 2014, the Company submitted a draft environmental impact statement and associated water license applications for the Back River Gold project to the Nunavut Impact Review Board ("NIRB") and the Nunavut Water Board respectively and received notice from NIRB that the document conforms to the environmental assessment guidelines and that the technical review process has begun.
  
  
• On March 4, 2014, the Company announced an update to its Back River mineral resource estimate incorporating the results of the 2013 exploration drill program. Highlights of the new mineral resource estimate include a significant increase in gold ounces in measured resource category; and, a significant increase in total contained gold ounces. See news release dated March 4, 2014 on www.sabinagoldsilver.com or on www.SEDAR.com.
  
  
• Subsequent to the quarter on April 7, 2014, the Company announced the 2014 Back River work program. A budget of approximately $19 million is planned and will include 9,000 meters of drilling largely at the Echo deposit; environmental and permitting activities, development studies and property holding costs. Three drill rigs are currently operating at Goose camp drilling at the Echo deposit.
  
  
• Subsequent to the quarter on April 22, 2014, the Company announced results from ongoing metallurgical testing on Back River. The tests confirmed a substantial increase in overall recoveries from 88.0% (which was assumed in the Prefeasibility Study) to an indicated 93.9%. The improved recoveries in combination with the increased mineral resource estimate are planned to be incorporated into a Feasibility Study ("FS") which is expected to be completed in the first half of 2015.
  
  

"Q1 has been a busy quarter for us," said Rob Pease, President & CEO, "with several major milestones being completed during or shortly after the quarter, the Company is looking forward to continued success in 2014. With an updated resource estimate, increased metallurgical recoveries and an established path though the permitting process, we are now ready to launch into a full feasibility study on Back River, continuing to de-risk the project while preserving our treasury. We also look forward to reporting on drill results from the prospective Echo deposit through the summer. The work on the Project done to date continues to demonstrate the potential for Back River to become a meaningful gold producer."

Financial Results

For the quarter ended March 31, 2014, the Company reported a net loss of $1.6 million compared to a net loss of $3.7 million for the same period in 2013. The decrease of $2.1 million was primarily due to lower operating expenses and deferred income tax expense, partially offset by reduced net finance income.

Operating expenses in Q1, 2014 were $2.1 million compared to $3.9 million in the same quarter in 2013, lower by $1.7 million due to lower stock-based compensation expense. Share based compensation decreased primarily due to a decrease in the option value. For the quarter ended March 31, 2014, the Company had granted and vested 2.9 million options with a weighted average fair value of $0.46 per option compared with 3.0 million options at $1.25 per option in the same period of 2013.

Net finance income was $0.2 million in Q1 2014, compared to $0.8 million in Q1 2013. The decrease was the result of lower interest income and amortization of flow-through premium. Interest income decreased to $0.2 million in Q1 2014 from $0.5 million in Q1 2013 due to reduced average cash and short term investment balances. Amortization of flow-through premium was nil in Q1 2014 compared to $0.3 million in Q1 2013. The Company has not completed any flow through financings in 2014.

The primary costs incurred by the Company are associated with exploration and evaluation of its mineral properties and are deferred until the properties are placed into production, sold or abandoned. In Q1, 2014, total deferred expenditures were $3.9 million compared to $14.2 million in 2013. The decrease of $10.3 million was primarily the result of no drilling activity at Back River in Q1, 2014 and decreased environmental and economic assessment expenditures compared to 2013. During the 2013, the Company completed a large field campaign including a total of 82,000 meters of drilling to support the expected FS in 2014; as a result, drilling and site support costs were lower in Q1 2014 by $7.6 million versus Q1 2013.

For the full March 31, 2014 interim financial statements and Management's Discussion and Analysis, please see the Company website at www.sabinagoldsilver.com.

SABINA GOLD & SILVER CORP

Sabina Gold & Silver Corp. is an emerging gold developer with district scale, world class assets in one of the world's newest, most politically stable mining jurisdictions: Nunavut, Canada.

Sabina's primary assets, all located in Nunavut, consist of: the Back River Gold Project, currently in the pre-feasibility and permitting phase; the Wishbone Claims, a vastly prospective grass roots project; and the Hackett River Silver Royalty, a silver production royalty on Glencore's Zinc's Hackett River project comprising 22.5% of the first 190 million ounces produced and 12.5% of all the silver produced thereafter. The Company ended 2013 with approximately $58 million in cash and anticipates ending 2014 with approximately $36 million in cash.

All news releases and further information can be found on the Company's website at www.sabinagoldsilver.com or on SEDAR at www.sedar.com.

All technical reports have been filed on www.sedar.com

Forward Looking Statements

This news release contains "forward-looking information" within the meaning of applicable securities laws (the "forward-looking statements"), including our belief as to the extent, results and timing of exploration programs and various studies including the FS, and exploration results, the results of the PFS, the potential tonnage, grades and content of deposits, timing, establishment and extent of resources and reserves estimates, potential production from and viability of the Company's properties, production and operating costs and permitting submission, timing and receipt of necessary permits and project approvals for future operations and access to project funding. These forward-looking statements are made as of the date of this news release. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated in or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. While we have based these forward-looking statements on our expectations about future events as at the date that such statements were prepared, the statements are not a guarantee that such future events will occur and are subject to risks, uncertainties, assumptions and other factors which could cause events or outcomes to differ materially from those expressed or implied by such forward-looking statements. Such factors and assumptions include, among others, the effects of general economic conditions, commodity prices, changing foreign exchange rates and actions by government and regulatory authorities and misjudgments in the course of preparing forward-looking statements.
In addition, there are known and unknown risk factors which could cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. Known risk factors include risks associated with exploration and project development; the need for additional financing; the calculation of mineral resources and reserves; operational risks associated with mining and mineral processing; fluctuations in metal prices; title matters; government regulation; obtaining and renewing necessary licences and permits; environmental liability and insurance; reliance on key personnel; the potential for conflicts of interest among certain of our officers or directors; the absence of dividends; currency fluctuations; labour disputes; competition; dilution; the volatility of the our common share price and volume; future sales of shares by existing shareholders; and other risks and uncertainties, including those relating to the Back River Project and general risks associated with the mineral exploration and development industry described in our Annual Information Form, financial statements and MD&A for the fiscal period ended December 31, 2013 filed with the Canadian Securities Administrators and available at www.sedar.com. Although we have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. 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. Accordingly, readers should not place undue reliance on forward-looking statements. We are under no obligation to update or alter any forward-looking statements except as required under applicable securities laws. This news release has been authorized by the undersigned on behalf of Sabina Gold & Silver Corp.