Mr. Jacques Perron reports

SAS REPORTS 2012 FOURTH QUARTER AND YEAR END RESULTS, BEATING CASH COST GUIDANCE, GENERATING $17.5 MILLION IN NET CASH FLOW AND PROVIDES 2013 GUIDANCE

St. Andrew Goldfields Ltd. earned net income attributable to shareholders for the fourth quarter of 2012, of $12.6-million, or three cents per share, as compared with net income of $12.9-million, or four cents on a per-share basis, for the fourth quarter of 2011. Operating cash flow in the quarter was $21.7-million or six cents per share, compared with operating cash flow for the same period last year of $14.0-million, or four cents per share.

For the fiscal year 2012, St. Andrews earned net income attributable to shareholders of $26.0-million or seven cents per share, as compared with net income of $17.2-million or five cents per share for fiscal year 2011. St. Andrews generated $54.1-million in cash flow from operations, or 15 cents on a per-share basis, compared with $23.4-million, or six cents per share, in fiscal year 2011.

St. Andrews is providing 2013 production guidance of between 95,000 and 105,000 ounces of gold, an increase over 2012, with similar cash cost guidance of between $800 (U.S.) to $850 (U.S.) per ounce, before royalties.

"We had a great fourth quarter and a very good year over all," said Jacques Perron, president and chief executive officer of St. Andrews. "We saw a steady increase in production and, as expected, our mine cash costs in the fourth quarter reduced to under $800 (U.S.) per ounce. Holt continues to perform well and we were operating at approximately 1,000 tonnes per day at the end of the fourth quarter. We had a solid operational performance in 2012, and are committed to continue to improve at each operation during 2013. We have met our 2012 production and unit cost guidance, and look to meet our 2013 goals and objectives in the same manner. Once more, I want to thank all the members of the SAS team for their commitment to achieving success. "

Fourth quarter 2012 and fiscal year 2012 highlights

Highlights

Fourth quarter 2012 and fiscal year 2012 achievements:

• Produced 25,829 ounces of gold from three operations (Holt, Holloway and Hislop mines) in fourth quarter 2012;
• Record gold production of 95,604 ounces, achieving the middle range of 2012 guidance;
• A record year of commercial production, representing a 29-per-cent increase in gold production over the previous year and reaching an annual production rate of approximately 100,000 ounces of gold;
• Sold 26,050 ounces of gold for the fourth quarter of 2012, and 94,067 ounces of gold in fiscal year 2012, at an average realized price per ounce of gold sold of $1,667 (U.S.) per ounce for revenues of $156.4-million;
• An increase in gold sales revenue by 40 per cent over the previous year;
• Fourth quarter 2012 mine cash cost of $745 (U.S.) per ounce and a royalty cost of $139 (U.S.) per ounce, for a total cash cost per ounce of gold sold of $884 (U.S.) per ounce for the fourth quarter of 2012;
• Fiscal year 2012 total cash cost per ounce of gold sold of $919 (U.S.) per ounce;
• Cash costs decreased quarter over quarter in fiscal year 2012, and beat guidance as production continued to ramp up at the Holt mine;
• Earned cash margin from mine operations of $21.5-million for the fourth quarter of 2012, and $69.9-million or a cash margin of $748 (U.S.) per ounce of gold sold for fiscal year 2012;
• An increase of $32.3-million or 86 per cent in cash margin from mine operations, when compared with fiscal year 2011;
• Generated operating cash flow of $21.7-million for the fourth quarter of 2012;
• Operating cash flow for fiscal year 2012 was $54.1-million or 15 cents per share;
• A record year of operating cash flow since the restart of mine operations in 2009;
• Cash flow from operations increased by $30.6-million or doubled on a per-share basis over the previous year;
• Generated net cash flow of $10.5-million and $17.5-million for the fourth quarter of 2012 and fiscal year 2012, respectively;
• Increase of $13.0-million in cash;
• St. Andrews started net cash flow generation in the second quarter of 2012, and ended 2012 with $30.7-million in cash and cash equivalents;
• Incurred total capital expenditures of $39.3-million in fiscal year 2012, including $6.7-million to advance the Taylor project;
• Total capital expenditures for the fourth quarter of 2012 was $11.9-million;
• Completed approximately 4,000 metres of capital development at the Holt and Holloway mines, allowing for four production areas at the Holt mine and the substantial completion of development at the Smoke Deep zone at the Holloway mine;
• Announce a prefeasibility study on the Taylor project in February, 2012, and extracted the first bulk sample program at the end of the year;
• Extracted a 15,000-tonne bulk sample from the Taylor project, which will be sampled and processed during the first quarter of 2013;
• Obtained a $25.0-million (U.S.) secured bank facility in May, 2012, and retired all the outstanding gold note;
• Used $15.0-million (U.S.) of the term credit facility to retire the gold notes liability in full;
• The $10.0-million (U.S.) revolving credit facility remains undrawn.

Holt mine, operations and financial review

The Holt mine produced 15,082 ounces of gold in the fourth quarter of 2012, from processing 89,901 tonnes of ore with an average head grade of 5.51 grams per tonne (g/t) gold (Au), which was above the zone 4 average reserve grade of 5.18 g/t Au. Mill recoveries were at their expected levels of approximately 94 per cent. Gold produced during the fourth quarter of 2012 increased by 15 per cent over the third quarter of 2012, and increased by 32 per cent over the fourth quarter of 2011, due to increased throughput of 12 per cent and 33 per cent, respectively. Holt produced at approximately 1,000 tonnes per day during the fourth quarter of 2012.

Gold sales in the fourth quarter of 2012 increased by 28 per cent over the third quarter of 2012, and 21 per cent over the fourth quarter of 2011, mainly due to the increased production as discussed above. The average realized price per ounce of gold sold for the fourth quarter of 2012 increased by $70 (U.S.) per ounce, when compared with the third quarter of 2012, and increased by $20 (U.S.) per ounce when compared with the fourth quarter of 2011. This led to an increase in gold sales revenue of $5.6-million when compared with the third quarter of 2012, and $4.5-million when compared with the fourth quarter of 2011. Gold sales for fiscal year 2012 were 87 per cent greater than that achieved during fiscal year 2011, as a result of the 36-per-cent increase in throughput, a 13-per-cent improvement in head grade, combined with the increase in the average realized price per ounce of gold sold.

Operating development in the fourth quarter of 2012 reduced by approximately 33 per cent from the third quarter of 2012, which resulted in a decrease in mine cash cost per ounce of gold sold of $135 (U.S.) per ounce or 19 per cent over the third quarter of 2012. Operating development caught up with budgeted amounts during the fourth quarter of 2012, and, as such, St. Andrews reduced contracted development mining in the quarter. It is foreseen that the development advancement achieved in the fourth quarter of 2012 will remain at a similar level in 2013. St. Andrews is currently developing zone 6 in order to bring it into production at the beginning of the fourth quarter of 2013.

Mine cash cost per ounce of gold sold for fiscal year 2012 was $651 (U.S.) per ounce, as compared with $785 (U.S.) per ounce in fiscal year 2011. The 17-per-cent reduction in mine cash cost per ounce of gold sold was the result of increased throughput, improved head grade and mill recovery, which was partially offset by a slight increase in the Canadian dollar to U.S.-dollar exchange rate. Royalty costs for the fourth quarter of 2012 were consistent with the level incurred in the third quarter of 2012 and the fourth quarter of 2011.

Cash margin from mine operations in the fourth quarter of 2012 increased by $5.3-million over the third quarter of 2012, as a result of an increase in gold sales and a decrease in unit operating costs. When compared with the fourth quarter of 2011, cash margin from mine operations increased by 21 per cent due to the increase in production in the fourth quarter of 2012. Holt contributed a cash margin from mine operations of $41.7-million for fiscal year 2012, as compared with $19.3-million achieved for fiscal year 2011.

Holt contributed 50,445 ounces, or approximately 53 per cent of the annual gold production for 2012.

Holloway mine, operations and financial review

The Holloway mine produced 5,240 ounces of gold from processing 46,606 tonnes of ore with an average head grade of 3.90 g/t Au from the Smoke Deep zone with minor contributions from the Middle zone. Recoveries were approximately 90 per cent, which exceeded the company's forecast due to favourable mineralogy. Gold production during the fourth quarter of 2012 decreased by 3 per cent over the third quarter of 2012, as a result of lower head grades, and decreased by 14 per cent over the fourth quarter of 2011, due to lower throughput and head grade.

Gold sales during the fourth quarter of 2012 decreased by $800,000 or 9 per cent over the third quarter of 2012, mainly as a result of lower head grade, offset by a 4-per-cent increase in the average realized price per ounce of gold sold. When compared with the fourth quarter of 2011, gold sales for the fourth quarter of 2012 decreased by 21 per cent, primarily due to a 17-per-cent decrease in throughput. Gold sales revenue for fiscal year 2012 decreased by 4 per cent over the fiscal year of 2011, primarily due to a 10-per-cent decrease in commercial gold production sold, which was the result of a 6-per-cent reduction in throughput.

When compared with the third quarter of 2012, mine cash cost per ounce of gold sold increased by $88 (U.S.) per ounce, mainly due to a 6-per-cent decrease in head grade and a reduction in the mining rate. Mine cash cost per ounce of gold sold for fiscal year 2012 was $820 (U.S.) per ounce, as compared with $894 (U.S.) per ounce achieved for fiscal year 2011. The decrease in mine cash cost per ounce of gold sold was the result of higher mill recovery and head grade, and a 1-per-cent increase in the Canadian-dollar to U.S.-dollar exchange rate in fiscal year 2012. Royalty cash cost per ounce of gold sold for the fourth quarter of 2012 increased by $17 (U.S.) per ounce of gold sold, when compared with the third quarter of 2012, and increased by $38 (U.S.) per ounce of gold sold in fiscal year 2012, as a result of the increasingly higher gold price during 2012.

Cash margin from mine operations for the fourth quarter of 2012 was $3.3-million, a decrease of $600,000 from the third quarter of 2012, and $900,000 when compared with the fourth quarter of 2011, mainly due to the decrease in gold sales and higher cash costs. Holloway contributed a cash margin from mine operations of $13.4-million for fiscal year 2012, as compared with $12.0-million for fiscal year 2011, due to a decrease in operating unit costs.

Holloway contributed 21,629 ounces, or approximately 22 per cent of the annual gold production for 2012.

Hislop mine, operations and financial review

The Hislop mine produced 5,507 ounces of gold during the fourth quarter of 2012. The head grade averaged 2.22 g/t Au, which was 18 per cent higher than the average reserve grade of 1.88 g/t Au. Recovery for Hislop averaged approximately 81 per cent during the quarter, which was below expectations due to the processing of a significant amount of green carbonate-syenitic ore where the size fraction of the gold was finer than usual.

When compared with the third quarter of 2012, gold sales revenue in the fourth quarter of 2012 decreased by 10 per cent due to a 12-per-cent decrease in head grade, as well as a 7-per-cent decrease in throughput. When compared with the fourth quarter of 2011, gold sales revenue improved by 19 per cent, due to a 14-per-cent improvement in head grade and a 3-per-cent increase in throughput. Gold sales revenue for fiscal year 2012 increased by 25 per cent, when compared with fiscal year 2011, due to 17-per-cent increase in gold production and a 5-per-cent increase in the average realized price per ounce of gold sold. The increase in production in fiscal year 2012 was also the result of a 31-per-cent improvement in head grade, partially offset by the reduced throughput.

Mine cash cost per ounce of gold sold was 24 per cent higher than the third quarter of 2012, mainly due to a 23-per-cent decrease in gold production. Mine cash cost per ounce of gold sold in the fourth quarter of 2012 was 8 per cent lower than the fourth quarter of 2011, due to the continued improvement in head grade, increased throughput and a decrease in the Canadian-dollar to U.S.-dollar exchange rate. Mine cash cost per ounce of gold sold for fiscal year 2012 was $1,034 (U.S.) per ounce, as compared with $1,272 (U.S.) per ounce achieved for fiscal year 2011. The reduction in unit cost was the result of improved head grade, offset partially by a reduction in throughput and a slight increase in the Canadian-dollar to U.S.-dollar exchange rate.

Cash margin from mine operations increased by $1.2-million in the fourth quarter of 2012, when compared with the fourth quarter of 2011, as a result of the increased gold sales and lower cash costs mentioned above. When compared with the third quarter of 2012, cash margin from mine operations decreased by $1.5-million as a result of decreased production. Hislop contributed a cash margin from mine operations of $14.7-million in fiscal year 2012, compared with $6.3-million achieved for fiscal year 2011, as a result of improved head grade.

Hislop contributed 23,530 ounces, or approximately 25 per cent of the annual gold production for 2012.

Taylor project

The company extracted a 15,000-tonne bulk sample in the fourth quarter of 2012, and is currently sending the material through a sampling tower which is used to generate a more representative sample than solely using chip samples from the mineralized face or muck samples taken from loading or trucking equipment. St. Andrews expects to process the bulk sample during the first quarter of 2013. Results of the bulk sample program will be released once the material has been processed, and all the data has been received and reviewed.

Exploration programs

Exploration activities during 2012 were focused on surface drilling at the Ghost zone and zone 4 targets near Holt and Holloway, and the Hislop North project, located northwest of the Hislop open pit. During 2012, St. Andrews conducted approximately 54,000 metres of surface drilling, consisting of 95 drill holes on the company's exploration targets. For 2013, the near-mine targets remain the focus of the exploration program and will include some of the regional exploration targets.

Capital resources

During fiscal year 2012, St. Andrews generated $17.5-million in net cash flow, of which $10.5-million was generated in the fourth quarter of 2012. Working capital at the end of 2012 improved by $10.3-million, as compared with working capital last year of $7.9-million, when adjusted for the current portion of the gold notes of $12.6-million, which were repaid in full in May, 2012. At the end of fiscal year 2012, the company had cash and cash equivalents of $30.7-million. The company has access to additional cash resources by way of a $10.0-million (U.S.) revolving credit facility, and, in conjunction with the expected cash flows from operations, the company is well positioned to finance its continuing capital programs at the mines, and to finance the further advancement of Taylor and other advanced-stage exploration projects, without the need for external financing.

Conference call information

A conference call will be held Friday, Feb. 15, 2013, at 10 a.m. EST, to discuss the fourth quarter and annual 2012 results. Participants may access the webcast via the St. Andrews website.

A recorded playback of the call will also be available via the website and will be posted within 24 hours of the call.

Qualified person

Production at the Holt, Holloway and Hislop mines, processing at the Holt mill, and development at the Taylor project, are being conducted under the supervision of Duncan Middlemiss, PEng, the company's chief operating officer and vice-president of operations. The exploration programs on the company's various mineral properties are under the supervision of Douglas Cater, PGeo, the company's vice-president of exploration. Mr. Middlemiss and Mr. Cater are qualified persons as defined by National Instrument 43-101, and have reviewed and approved this news release.

                                   STATEMENTS OF OPERATIONS
          (expressed in thousands of Canadian dollars, except per-share information)

                                               Three months ended Dec. 31,      Year ended Dec. 31,
                                                           2012      2011           2012      2011

Gold sales                                             $ 44,332  $ 40,435       $156,391  $111,858
Operating costs and expenses
Mine site operating                                      19,242    18,452         73,769    66,098
Production royalty                                        3,590     3,285         12,753     8,222
Site maintenance and preproduction                          232       180            684       264
Exploration                                               2,149     1,443          7,040     8,367
Corporate administration                                  2,340     1,277          7,491     6,203
Depreciation and depletion                                7,127     5,014         23,481    16,665
Writedown of mining assets                                    -         -              -       300
                                                         34,680    29,651        125,218   106,119
Operating income                                          9,652    10,784         31,173     5,739
Finance costs                                              (507)   (1,112)        (2,687)   (4,304)
Mark-to-market gain (loss) on gold-linked 
liabilities                                                 151     1,414         (1,667)   (3,347)
Mark-to-market gain (loss) on foreign 
currency derivatives                                       (333)    3,436          2,061    (3,869)
Foreign exchange gain (loss)                                  4    (1,120)          (323)    1,134
Gain (loss) on divestiture of non-core assets              (272)    1,049            247      (304)
Impairment (loss) on available-for-sale investment         (825)        -           (825)        -
Finance income and other                                     77        42            260       687
Income (loss) before taxes                                7,947    14,493         28,239    (4,264)
Deferred taxes                                            4,685    (1,572)        (2,247)   21,437
Net income for the period                              $ 12,632  $ 12,921       $ 25,992  $ 17,173
Other comprehensive income (loss)   
Unrealized (loss) on available for sale investments, 
net of tax of nil for all periods                          (193)      (50)          (596)     (174)
Impairment (loss) on available for sale investment          825         -            825         -
Unrealized mark-to-market gain (loss) on 
foreign currency derivatives                               (258)        -            433         -
                                                            374       (50)           662      (174)
Comprehensive income for the period                    $ 13,006  $ 12,871       $ 26,654  $ 16,999
Basic and diluted earnings per share 
attributable to shareholders                           $   0.03  $   0.04       $   0.07  $   0.05

We seek Safe Harbor.