Mr. Patrick Godin reports

NEW GOLD CONSOLIDATES 100% INTEREST IN ITS NEW AFTON MINE

New Gold Inc. has entered into an agreement with Ontario Teachers' Pension Plan to acquire the remaining 19.9-per-cent free cash flow interest in the company's New Afton mine. Following the transaction, the company will have fully consolidated its free cash flow interest in New Afton to 100 per cent. All dollar amounts are in United States dollars.

On closing of the transaction, Ontario Teachers' free cash flow interest in New Afton will be fully eliminated in exchange for a cash payment of $300-million from New Gold. New Gold plans to finance the cash payment with cash on hand, borrowings from its existing revolving credit facility and a gold prepayment financing.

Benefits to New Gold shareholders:

• Fully consolidates free cash flow from one of Canada's most attractive mines -- New Afton is entering into a period of expected significant free cash flow growth driven by increasing production and improved costs.
• Investment in an existing high-quality operation -- New Gold has developed extensive block caving expertise and social partnerships in an exceptional location.
• Accretive and disciplined transaction -- New Gold will fully consolidate ownership, gaining exposure to 100 per cent of New Afton's life-of-mine cash flow with no equity dilution to New Gold's shareholders. New Gold will finance the transaction by utilizing its strong balance sheet and significant near-term free cash flow, while maintaining financial discipline and flexibility.
• Increased upside exposure -- New Gold's focus on near-mine exploration activities, highlighted by exceptional drill results released in September, 2024, provides New Afton with the potential to add substantial value by improving the production profile and extending mine life. The company is committing $17-million toward exploration in 2025, with a strong focus on the K zone.

"This is an excellent transaction, allowing New Gold to fully consolidate the free cash flow exposure to one of Canada's highest quality gold/copper assets, which we already own and operate. This transaction allows us to grow in an exceptional location with no diligence or integration risk, and with no equity dilution to our shareholders," stated Patrick Godin, president and chief executive officer. "With the C zone ramp-up progressing well, New Afton is on the verge of exceptional production growth and cost improvement that should lead to increased free cash flow generation. Our goal is to maximize this free cash flow generation at the mine, while continuing our exploration program to extend mine life and create further value for our shareholders and stakeholders. We would also like to thank Ontario Teachers' for their support and partnership over the last five years."

Gold prepayment financing

New Gold plans to finance a portion of the cash payment with approximately $100-million from a gold prepayment financing. Under the gold prepayment, the company would have the obligation to deliver a set number of gold ounces over a 12-month term in exchange for $100-million in cash up front. Based on current pricing, the total ounces expected to be delivered represents approximately 8 per cent of the company's expected consolidated gold production in that period.

Other terms of the transaction

At closing, the parties will terminate all existing agreements with respect to Ontario Teachers' free cash flow interest in New Afton, including the previously disclosed Ontario Teachers' right to a one-time cash payment of $20-million on a change of control of New Gold if it is announced prior to Jan. 31, 2026.

The closing of the transaction is subject to customary conditions and is expected to close at the beginning of May. The transaction does not require shareholder approval.

About New Gold Inc.

New Gold is a Canadian-focused intermediate mining company with a portfolio of two core producing assets in Canada: the Rainy River gold mine and the New Afton copper-gold mine. New Gold's vision is to build a leading, diversified, intermediate gold company based in Canada that is committed to the environment and social responsibility.

We seek Safe Harbor.