Mr. John Dorward reports

ROXGOLD REPORTS THIRD QUARTER RESULTS WITH RECORD OPERATING MARGINS OF $1,152/OZ

Roxgold Inc. has released its third quarter and first-nine-month financial results for the period ended Sept. 30, 2020.

For complete details of the unaudited condensed interim consolidated financial statements and associated interim management's discussion and analysis, please refer to the company's filings on SEDAR or the company's website. All amounts are in U.S. dollars unless otherwise indicated.

Q3 2020 highlights

During the three- and nine-month periods ended Sept. 30, 2020

Operations:

• Produced 33,557 ounces of gold at an average grade of 7.7 grams per tonne in Q3 2020, totalling 98,749 ounces produced for year-to-date 2020;
• Reported quarterly plant throughput of 1,424 tonnes per day for a total of 131,029 tonnes, which exceeded increased nameplate capacity of 1,100 tpd by approximately 29 per cent;
• Maintained upper end of annual gold production guidance between 120,000 and 130,000 ounces, subject to existing operating conditions being maintained;
• Reported an interim reserve and resource estimate at Yaramoko with total proven and probable mineral reserves, increasing by 8 per cent to 710,000 ounces of gold and replacing depletion of 207,396 ounces during the period from Dec. 31, 2018, to June 30, 2020; measured and indicated mineral resources increased 4 per cent to 857,000 ounces of gold, increasing the mineral endowment of measured and indicated resources plus cumulative production to date at Yaramoko to 1.4 million ounces.

Financial:

• Sold 30,401 ounces of gold for a total of $57.4-million in gold sales (34,200 ounces (1) and $50.2-million (1), respectively, in Q3 2019) and 96,806 ounces for $167.5-million YTD 2020 (100,100 ounces (1) and $136.0-million (1), respectively, YTD 2019);
• Cash and dore on hand increased by $11.4-million over the quarter after growth expenditure of $7.9-million;
• Achieved EBITDA (earnings before interest, taxes, depreciation and amortization) (2) of $20.6-million in Q3 2020 compared with $16.5-million in Q3 2019;
• Generated cash flow from mining operations (2) totalling $28.2-million for cash flow from mining operations per share (2) of eight cents (10 Canadian cents per share);
• Adjusted net income (2) of $10.6-million (three cents per share) compared with $7.7-million (two cents per share) in Q3 2019;
• Produced a mine operating margin (2) of $1,152 per ounce in Q3 2020 and a return on equity (2) of 18 per cent.

Growth:

• Received environmental and social impact assessment approval and advanced drilling at the Seguela gold project to support the coming feasibility study, which remains on track for the first half of 2021;
• Announced discovery of the Koula prospect, at Seguela, with over 40 holes drilled to date, demonstrating wide intersections of high grades, including 109 grams per tonne over four metres in hole SGRC919 and 26.1 g/t over 19 m in hole SGRC877;
• Tested additional mineralization corridors at Boussoura, in southern Burkina Faso, identifying over nine mineralized vein sets over four vein corridors with high-grade results, such as 4.8 m at 26.9 g/t Au from BSR-20-RD-FFR-040 and nine m at 10.7 g/t Au from BSR-20-RC-FFR-063.

Safety:

• Reported one lost-time-injury (LTI) incident at Yaramoko; this was the first LTI incident at Yaramoko since September, 2018;
• Management of the current global COVID-19 crisis is continuing with operations at Yaramoko not materially impacted, with heightened preventative measures and response plans in place to mitigate and minimize any potential impacts; operations continue to operate with reduced personnel due to COVID-19 travel restrictions and protection protocols; the company is continually assessing the health and safety risks to the company's personnel and contractors at its operations and offices.

"The Yaramoko mine complex has continued to outperform this year as the mine is on track to achieve the upper end of our guidance with record margins," commented John Dorward, president and chief executive officer of Roxgold. "In the quarter, we achieved adjusted net income of $10.6-million, generated over $28-million in cash flow from mining operations and reported a return on equity of 18 per cent. Our financial performance has been driven by the strong operational performance with 98,749 ounces of gold produced in the first nine months of this year, putting the company well on its way towards hitting the upper end of our annual production guidance of 120,000 to 130,000 ounces. Today, we also announced an updated mineral reserve and mineral resource estimate for Yaramoko, which saw the mine grow its mineral reserves by 7 per cent to 710,000 ounces of gold and measured and indicated mineral resources by 4 per cent to 857,000 ounces of gold. This increase demonstrates the ability of Yaramoko to continue to replace production, reinforcing the project as a stable foundation of long-term production and free cash flow generation for Roxgold's ambitious growth plans.

"Our global teams continue to manage the operational challenges related to the ongoing COVID pandemic to ensure a safe and secure working environment for our employees, contractors and local communities. The travel restrictions and distancing protocols that have been effective in curtailing the impacts of the coronavirus have necessitated adjusted schedules of mining personnel with correspondent impacts on mining volumes and costs. Despite these challenges, we have continued to strengthen our balance sheet, with cash and dore on hand increasing by $11.4-million to $56.4-million, while maintaining good momentum on production over the quarter.

"Looking ahead, the Seguela gold project in Cote d'Ivoire continues to return excellent exploration results as the project progresses towards the completion of the feasibility and construction decision in the first half of next year, which will put the project on track for pouring first gold in 2022. Seguela saw notable developments last quarter, including the approval of the environmental and social impact assessment and the discovery of the newest high-grade deposit: Koula. Initial site works will be commenced soon to enable a rapid construction ramp-up following completion of the feasibility study. We currently have four drills turning at Seguela, with a focus on extension and infill drilling at Koula and the continued scout testing of the extensive portfolio of targets within our land package."

                                            Q3 2020 HIGHLIGHTS
 
                                                         Three months ended Sept. 30,   Nine months ended Sept. 30,
                                                                 2020           2019           2020           2019

Gold ounces produced                                           33,557         33,036         98,749        101,041
Gold ounces sold (1)                                           30,401         34,200         96,806        100,100
Financial data (in thousands of U.S. dollars)
Gold sales (1)                                                $57,379        $50,154       $167,532       $135,944
Mine operating profit (3)                                      22,127         16,396         60,426         40,497
EBITDA (2)                                                     20,618         16,536         63,633         44,667
Adjusted EBITDA (2)                                            25,620         22,316         74,429         56,269
Adjusted EBITDA margin (2)                                         45%            44%            44%            42%
Net income                                                      5,606          1,928         14,982            902
Basic earnings per share attributable to shareholders            0.01           0.00           0.03           0.00
Adjusted net income (2)                                        10,608          7,708         25,778         12,504
Per share (2)                                                    0.03           0.02           0.07           0.03
Cash flow from mining operations (2)                           28,245         21,143         86,890         67,678
Per share (2)                                                    0.08           0.06           0.23           0.18
Return on equity (2)                                               18%            13%            18%            13%
Statistics (in dollars)
Average realized selling price (per ounce)                      1,887          1,481          1,731          1,358
Cash operating cost (per tonne processed) (2)                     158            148            151            151
Cash operating cost (per ounce produced) (2)                      615            510            589            499
Total cash cost (per ounce sold) (2)                              735            586            696            565
Sustaining capital cost (per ounce sold) (2)                      303            195            294            194
Site all-in sustaining cost (per ounce sold) (2)                1,037            781            990            760
All-in sustaining cost (per ounce sold) (2)                     1,095            834          1,041            815

2020 operating outlook:

• Gold production between 120,000 and 130,000 ounces;
• Cash operating cost (2) between $520 and $580 per ounce;
• All-in sustaining cost (2) between $930 and $990 per ounce;
• Non-sustaining capital spend of $5-million to $10-million;
• Growth spend (includes exploration and Seguela study spend) of $20-million to $25-million.

Production

Based upon Q3 production results, Roxgold is on track to deliver at the upper end of annual gold production guidance from Yaramoko.

Cash operating and all-in sustaining costs

During the quarter, there was an unfavourable impact of $104 per ounce sold to all-in sustaining costs due to COVID-19, timing of gold shipments and the higher gold price.

• There was lower mining activity at Yaramoko as it continued to operate with reduced personnel due to COVID-19 travel restrictions and protection protocols. Throughput levels were maintained as the processing plant was supplemented with 36,201 tonnes of low-grade stockpile at an average grade of 3.1 g/t processed. The cash cost impact of processing the lower-grade stockpiled material was $49 per ounce sold.
• Roxgold reported quarterly gold sales of 30,401 ounces compared with production of 33,557 ounces. Gold ounces sold were lower than production due to the timing of gold shipments at the end of the quarter with 3,320 ounces of gold dore on hand. The timing of gold shipments had a $35-per-ounce-sold impact on all-in sustaining costs.
• The higher average realized gold price of $1,887 per ounce also increased royalty payments by $20 per ounce sold compared with guidance assumptions.

On a year-to-date basis, the cash cost impact of processing the lower-grade stockpiled material is $30 per ounce sold, and the higher gold price increased royalty payments by $19 per ounce compared with guidance assumptions. Development costs for fourth quarter will reduce as decline development at Bagassi South was completed in September. Based on YTD performance, the company is expecting to be at the upper end of cost guidance range due to operational impacts of managing COVID-19-related protocols.

Total mine operating expenses for the three- and nine-month period include $1.3-million for COVID-19 costs, which reflects incremental costs, primarily relating to personnel, camp and transportation costs. These costs are excluded from per-ounce cost metrics.

Growth spend

Growth spend has increased to $20-million to $25-million due to the continuing success of the drilling program at Seguela and Boussoura and the commencement of early works in Q4 at Seguela. This includes a front-end engineering and design study, upgrading site access through a road improvement program and some initial site works for the accommodation village. The intention of the early works activities is to enable a rapid ramp-up to full construction next year with the aim of production commencing in 2022.

Response to the COVID-19 pandemic

Management of the current global COVID-19 crisis is continuing particularly as various jurisdictions implement measures to reopen or close again their economies. The company has been pro-active in its response to the potential threats posed by COVID-19 and has implemented a range of measures to protect the health and well-being of its employees and host communities while continuing to operate, to the extent possible, in ordinary course of business. These measures include, but are not limited to: quarantine, reducing on-site crew sizes, enhanced cleaning and disinfecting protocols, requiring workers with symptoms to self-isolate, and promoting preventative measures, including social distancing and frequent handwashing. All employees returning to site are required to complete a testing and screening process, which includes a quarantine period before they are allowed to join the active work force. As a result, operations at Yaramoko to date have not been materially impacted by COVID-19. The company is continually assessing the evolving situation, including the health and safety risks to the company's personnel and contractors at its operations and offices. Adjustments will be made, as necessary, to ensure the continued safety of its personnel and contractors.

Whilst production at Yaramoko has been maintained, a prolonged COVID-19-related interruption may have an impact on the company's operations, financial position and liquidity.

The company has strengthened its liquidity position in the quarter, with its cash and dore on hand increasing to $56.4-million and an unutilized revolving credit facility totalling $20-million. In addition, the company continues to make regularly scheduled gold shipments from the Yaramoko gold mine.

Health and safety performance

Safety is a core value of Roxgold. The company regrets to report that a lost-time-injury incident occurred in Q3 2020. The LTI was suffered by a contractor's employee and marked the first LTI incident at Yaramoko since September, 2018.

Operational performance

Mining activities totalled 109,737 tonnes of ore mined at an average mined grade of 8.9 g/t (includes marginal ore mined totalling 14,811 tonnes at a grade of 2.2 g/t) and 1,146 metres of waste development. The lower mining activity was due to Yaramoko continuing to operate with reduced personnel due to COVID-19 travel restrictions and protection protocols.

During the quarter, the 55 Zone mined 70,581 tonnes at higher grades at depth with an average mined grade of 9.9 g/t, and Bagassi South mine contributed 39,185 tonnes at a grade of 7.1 g/t.

The mining tonnage was attributable to the ramping up of stoping activities at the Bagassi South mine in Q3, with stoping operations expanding as more development levels were completed, offset by reduced personnel due travel restrictions associated with the COVID-19 travel restrictions and protection protocols. During Q3 2020, approximately 69 per cent of ore produced came from stoping activities and 31 per cent from development.

Decline development at the 55 Zone mine reached the 4,714 level, approximately 600 metres below surface. Ore development continued down to the 4,734 level and on the eastern extensions of the 4,862 and 4,879 levels. The development of the Bagassi South decline reached the 5,044 level, and ore development commenced on the 5,061 level, which is approximately 270 metres below surface. Good progress on development has seen the Bagassi South mine largely developed with decline development completed at the end of September. Ore development will continue on the 5,044 level, and operations will be more focused on stoping activities in Q4 2020.

Mine reconciliation performance between the mineral reserve and grade control model was 110 per cent for tonnes and 105 per cent for grade in the third quarter of 2020.

The company's gold production in Q3 2020 was 33,557 ounces compared with 33,306 ounces in Q3 2019. The plant processed 131,029 tonnes at an average head grade of 7.7 g/t in Q3 2020 compared with 114,036 tonnes of ore at 9.1 g/t in Q3 2019. There was an increase in the processing of stockpiled material with 36,201 tonnes of low-grade stockpile at an average grade of 3.1 g/t processed to supplement the mined ore as Yaramoko operated with reduced personnel due to COVID-19 travel restrictions and isolation protocols in Q3 2020.

The processing plant availability was 97.4 per cent in the quarter compared with 93.2 per cent in Q3 2019, and reported an average throughput rate of 1,424 tonnes per day, exceeding nameplate capacity by approximately 29 per cent. Plant recovery was 98.2 per cent in Q3 2020 compared with 98.0 per cent for the comparative quarter.

The Yaramoko gold mine continued to maintain a low cash operating cost (2) of $158 per tonne processed driven by increased throughput and focus on cost control.

Financial performance

(i) Third quarter of 2020 versus third quarter of 2019

Gold sales in Q3 2020 totalled $57.4-million from 30,401 ounces of gold. The company's average realized gold price was $1,887 per ounce sold, 27 per cent higher than the average realized gold price in Q3 2019.

The company maintained a cash operating cost (2) per tonne processed of $158 per tonne. The cash operating cost (2) per ounce produced totalled $615 per ounce for the period compared with $148 per tonne and $510 per ounce in the comparative period.

The total cash cost (2) per ounce sold of $735 in Q3 2020 was higher compared with $586 per ounce sold in Q3 2019. This was primarily impacted by the processing of lower-grade stockpiled material, which had an impact of $49 per ounce sold, the higher gold price in Q3 2020, which increased royalty payments by $20 per ounce sold, and the commencement of the 1-per-cent contribution to the mining fund for local development, increasing royalties by $19 per ounce sold.

As a result, the company achieved a site all-in sustaining cost (2) of $1,037 per ounce sold and an all-in sustaining cost (2) of $1,095 per ounce sold in the three-month period in 2020 compared with $781 per ounce and $834 per ounce sold, respectively, in the comparable period. The higher all-in sustaining cost in the quarter is attributed to the higher cash cost per ounce sold, including the processing of marginal ore and the timing of gold shipments, which had a $35 impact on the all-in sustaining cost for Q3 2020.

The company generated a mine operating margin (2) of $1,152 per ounce in 2020, which was 28 per cent higher than in 2019 mainly due to the higher average gold sales price.

The company invested $5.5-million in underground mine development at the 55 Zone and $3.7-million at Bagassi South in the third quarter of 2020.

The company generated strong cash flow from mining operations (2) of $28.2-million in Q3 2020 for cash flow from mining operations per share (2) of eight cents (10 Canadian cents per share). Comparatively, the company generated cash flow from mining operations (2) of $21.1-million and six-cent cash flow from mining operations per share (2) in Q3 2019.

(ii) First nine months of 2020 versus first nine months of 2019

The company sold 96,806 ounces of gold resulting in revenue from gold sales (1) totalling $167.5-million compared with 100,100 ounces (1) and $135.9-million (1), respectively, in the comparable period in 2019. During this period, the company's average realized gold price was $1,731 per ounce sold compared with an average realized gold price of $1,358 per ounce in Q3 2019.

During the nine-month period ended Sept. 30, 2020, the company maintained a low cash operating cost (2) per tonne processed of $151 per tonne, in line with the $151 per tonne achieved during the comparable period in 2019. The cash operating cost (2) per ounce produced totalled $589 per ounce for the period compared with $499 per ounce in the prior year mainly driven by the processing of lower-grade stockpiled material, which had an impact of $30 per ounce sold, the higher gold price in 2020, which increased royalty payments by $19 per ounce sold, and the timing of the gold shipments, which had an $11 impact on the all-in sustaining cost for 2020.

The total cash cost (2) per ounce sold of $696 in the nine months ended Sept. 30, 2020, was higher compared with $565 per ounce sold in the same period in 2019. As a result, the company achieved a site all-in sustaining cost (2) of $990 per ounce sold and an all-in sustaining cost (2) of $1,041 per ounce sold for YTD 2020 compared with $760 per ounce and $815 per ounce sold, respectively, in the same period in 2019.

The company has invested $17.0-million in underground development at 55 Zone and $11.5-million at Bagassi South for the nine-month period compared with $19.4-million for the comparable period in 2019. The comparable period also included $18.1-million invested in precommercial production underground mine development at the Bagassi South mine.

Review of Q3 2020 financial results

Mine operating profit

During the quarter ended Sept. 30, 2020, revenues totalled $57.4-million (2019: $42.3-million) while mine operating expenses and royalties totalled $20.2-million (2019: $12.4-million) and $3.4-million (2019: $2.1-million), respectively. The increase in sales is primarily due to a 27-per-cent increase in the average realized gold price, offset by an 11-per-cent decrease in ounces sold. Total mine operating expenses include $1.3-million COVID-19-related costs, which reflect incremental costs, primarily relating to personnel, camp and transportation costs. During the quarter, the company achieved total cash cost (2) per ounce sold of $735 and a mine operating margin (2) of $1,152 per ounce sold.

During the nine-month period ended Sept. 30, 2020, revenues totalled $167.5-million (2019: $121.8-million) while mine operating expenses and royalties totalled $58.7-million (2019: $40.8-million) and $10.1-million (2019: $5.7-million), respectively. The increase in revenue is primarily due to the 27-per-cent increase in the average realized gold price. During the nine-month ended Sept. 30, 2020, the company achieved total cash cost (2) per ounce sold of $696 and a mine operating margin (2) of $1,035 per ounce sold.

For more information on the cash operating costs (2), see the financial performance of the mine operating activities section of management's discussion and analysis.

During the three- and nine-month period ended Sept. 30, 2020, depreciation totalled $11.6-million and $38.4-million compared with $11.3-million and $34.8-million in 2019. The increase in depreciation is a result of the company's continued investment in the underground development of 55 Zone and Bagassi South combined with higher throughput.

General and administrative expenses

General and administrative expenses for the three- and nine-month period were $1.6-million and $4.0-million compared with $1.2-million and $3.8-million for the respective periods.

Sustainability and other in-country costs

Sustainability and in-country costs totalled $500,000 and $1.3-million for the three- and nine-month periods ended Sept. 30, 2020, respectively, compared with $700,000 and $1.8-million in the comparative period. The decrease in expenditures primarily relates to timing of community investments in 2020. These expenditures are incurred as part of Roxgold's commitment to responsible operations in Burkina Faso, including several sustainability and community projects.

Exploration and evaluation expenses (E&E)

Exploration and evaluation expenses totalled $8.1-million and $20.1-million for the three and nine months ended Sept. 30, 2020, respectively, compared with $4.1-million and $11.4-million in the comparative period. The significant increase in exploration and evaluation activities was primarily due to the significant advancement of the feasibility study at the Seguela gold project expected to be released in the first half of 2021. There was also drilling at the Boussoura project in Burkina Faso.

E&E expenses totalled $14.9-million at the Seguela gold project and $5.2-million for Boussoura and Yaramoko for the nine months ended Sept. 30, 2020. Expenditures at the Seguela gold project included $8.4-million in drilling costs with $4.6-million of exploration drilling primarily at Ancien, along with $2.4-million relating to infill drilling at Boulder and Agouti and $900,000 at Ancien. The company has spent $2.6-million on preliminary economic assessment and feasibility study costs.

Drilling expenses totalled $2.5-million for YTD 2020 at the Boussoura permit.

Share-based payments

Share-based payments totalled $900,000 and $2.9-million for the three and nine months ended Sept. 30, 2020, respectively, compared with $900,000 and $2.0-million in the comparative period.

Other income (expenses)

Other income (expenses) totalled $2.8-million and $8.7-million for the three and nine months ended Sept. 30, 2020, respectively, compared with $5.2-million and $14.2-million in the comparative period. The decrease is mainly attributed to the favourable movement in foreign exchange gain of $900,000 in Q3 2020 and $2.2-million in YTD Q3 2020.

Current and deferred income tax expense

The current income tax expense for the three and nine months ended Sept. 30, 2020, has increased with the comparable period in 2019 due to higher mine operating profits. The higher effective tax rate is also driven by the significant increase in exploration expenditures in 2020 incurred in Burkina Faso and Ivory Coast not being tax effected due to the company's status under the mining regulations.

Net income and EBITDA

The company's net income was $5.6-million for the three months ended Sept. 30, 2020, and $15.0-million for the nine months ended Sept. 30, 2020, compared with net income of $1.9-million and $900,000, respectively, in the comparative 2019 period.

The company's EBITDA (2) was $20.6-million for the three months ended Sept. 30, 2020, and $63.6-million for the nine months ended Sept. 30, 2020, compared with $16.5-million and $44.7-million, respectively, in the comparative 2019 period.

Net income increased significantly compared with the prior period primarily as a result of higher average realized gold sales price, offset by its focus on growth with significant investments in exploration and evaluation at Seguela and Boussoura and higher depreciation.

Income attributable to non-controlling interest

For the three- and nine-month periods ended Sept. 30, 2020, the income attributable to the non-controlling (NCI) interest was $1.4-million and $4.0-million, respectively. The government of Burkina Faso holds a 10-per-cent carried interest in Roxgold Sanu SA and, as such, is considered Roxgold's NCI. The NCI attributable income is based on international financial reporting standard accounting principles and does not reflect the dividend payable to the minority shareholder of the operating legal entity in Burkina Faso.

Financial position

As of Sept. 30, 2020, the company had $50.1-million in cash and cash equivalents, and dore on hand of $6.3-million (4) with $35.9-million of long-term debt. The restricted cash totalling $1.5-million relates to funds restricted for the purposes of future restoration costs of the Yaramoko gold mine. The company's current assets exceed current liabilities by $24.5-million.

With the existing cash balance and the forecasted cash flows from operations, the company is well positioned to finance its cash requirements for the next 12 months, which relate primarily to the following activities:

• Underground development at the 55 Zone and Bagassi South;
• Exploration programs at Seguela and Boussoura;
• Principal debt and interest repayments.

The company manages its capital structure and adjusts, when necessary, in accordance with its objectives and changes in economic conditions. During second quarter 2020, the company completed the refinancing of its existing credit facility by consolidating the outstanding principal amount of the original credit facility, as well as the revolving credit facility, into a single credit facility with an outstanding principal balance of $37.1-million.

The company also secured an additional $20-million as a revolving credit facility to provide increased liquidity and financial flexibility.

The company's total assets as of Sept. 30, 2020, have increased by $35.6-million when compared with Dec. 31, 2019. This is mainly driven by the continuing investment in property, plant and equipment and the contract extension with AUMS at Yaramoko, offset by depreciation during the year.

Interim reserve and resource estimate

Proven and probable mineral reserves at Yaramoko increased 8 per cent to 710,000 ounces gold, net of mining depletion of 207,396 oz Au, at an average processed head grade of 9.2 g/t, from the period of Dec. 31, 2018, to June 30, 2020. Measured and indicated mineral resources increased 4 per cent to 857,000 oz Au from 827,000 oz Au relative to the Dec. 31, 2018, estimate (refer to company press release dated July 11, 2019, for further details with respect to the Dec. 31, 2018, estimates).

The increase in mineral reserves and measured and indicated mineral resources is primarily attributed to the success of a prior drilling program that delineated mineralization in the near-surface portion of the 55 Zone, intersecting several high-grade intervals close to surface and above zones previously mined from underground in the early stages of the 55 Zone mining operation. The objective of this drill program was to determine the potential for an open-pit operation to complement the high-grade underground operation and extend the mine life at the 55 Zone (refer to company press release dated Sept. 30, 2020).

Inferred mineral resources decreased 37 per cent from 191,000 oz Au to 121,000 oz Au as per the Dec. 31, 2018, estimate. The decrease in the inferred mineral resources is primarily due to the conversion of prior inferred mineral resources to indicated mineral resources with the extension of inferred mineral resources to be a priority for coming underground drilling campaigns.

The mineral resource and mineral reserve models were prepared in conformity with the Canadian Institute of Mining, Metallurgy and Petroleum's estimation of mineral resources and mineral reserves best practices guidelines (November, 2019), and are classified per the CIM definition standards for mineral resources and mineral reserves (May, 2014).

Exploration activities

Seguela gold project

Exploration activities have continued to progress to delineate additional mineral resources within close proximity to Antenna. The current targets, including the recent discovery of Koula, along with the previously defined Agouti, Boulder and Ancien, are within six kilometres of the Antenna deposit.

Significant progress was made on defining and extending mineralization at Boulder, Agouti and Ancien with four reverse circulation/diamond core rigs active throughout the third quarter of 2020, along with concluding geotechnical drilling in support of the feasibility study.

Koula

Located approximately one kilometre to the east of Antenna, the high-grade Koula deposit was discovered through field reconnaissance and coincident recent artisanal workings in an area previously considered to be a lower exploration priority.

The positive results from the initial 10-hole RC reconnaissance program (refer to company press release dated Sept. 8, 2020) triggered an infill program of RC and diamond drilling to 50-metre centres. Three drill rigs were operating at Koula at the end of the quarter with a fourth en route with drilling to 50-metre centres designed to support the rapid advancement of Koula for inclusion of the prospect in the coming feasibility study.

Displaying similar characteristics to those of Ancien in terms of host geology, mineralization style, high-grade tenor and coarse visible gold, Koula remains open to the south with an interpreted southerly plunge remaining to be tested beyond the currently defined 350-metre down plunge extent. Mineralization is hosted by quartz-carbonate veining associated with a well-developed mylonitic fabric within and along the interpreted margins of a tholeiitic basalt, which in turn has been tightly folded. Coarse gold is commonly recorded in the higher-grade zones.

Highlights of recent results include:

• 19 metres at 26.1 grams per tonne gold in drill hole SGRC877 from 189 m, including:
  • Two m at 23.0 g/t Au from 192 m;
  • Two m at 52.6 g/t Au from 195 m;
  • One m at 283 g/t Au from 202 m;
• 12 m at 32.1 g/t Au in drill hole SGRC854 from 84 m, including:
  • Four m at 92.1 g/t Au from 90 m;
• Eight m at 14.8 g/t Au in drill hole SGRC875 from 45 m, including:
  • Two m at 46.2 g/t Au from 45 m;
  • One m at 14.4 g/t Au from 50 m;
• Four m at 108.9 g/t Au in drill hole SGRC919 from 32 m, including:
  • One m at 174.5 g/t Au from 32 m;
  • One m at 257.0 g/t Au from 34 m;
• Nine m at 49.3 g/t Au in drill hole SGDD072 from 73 m, including:
  • One m at 201.0 g/t Au from 74 m;
• Nine m at 30.1 g/t Au in drill hole SGRD935 from 205 m, including:
  • Three m at 81.8 g/t Au from 211 m;
• 32 m at 8.9 g/t Au in drill hole SGRC920 from 138 m, including:
  • Two m at 28.6 g/t Au from 141 m;
  • Three m at 31.4 g/t Au from 157 m;
• 18 m at 8.8 g/t Au in drill hole SGRC922 from 25 m, including:
  • Two m at 49.8 g/t Au from 31 m;
• 25 m at 7.4 g/t Au in drill hole SGRC930 from 135 m, including:
  • Two m at 43.7 g/t Au from 140 m;
  • One m at 25.3 g/t Au from 143 m;
• 11 m at 11.2 g/t Au in drill hole SGRC929 from 79 m, including:
  • One m at 101.0 g/t Au from 86 m;
• 19 m at 5.2 g/t Au in drill hole SGRC916 from 88 m, including:
  • One m at 18.0 g/t Au from 92 m;
  • One m at 28.8 g/t Au from 106 m.

Ancien

Infill and extension drilling continued during the quarter with two RC/diamond core drill rigs operating, infilling and increasing the confidence of the PEA inferred mineral resource. Highlight results include 15 m at 10.9 g/t Au and four m at 9.2 g/t Au from SGRD 747 and four m at 57.7 g/t Au from SGRD 748.

Drilling to test the upper extensions of the hangingwall lode also intersected several high-grade intervals, including 12 m at 19.8 g/t Au from SGRD761 and 11 m at 8.2 g/t Au from SGRD760, extending mineralization in this area an additional 100 m up plunge and improving the understanding of key structural controls associated with high-grade mineralization.

Highlights from the most recent drilling at Ancien include:

• 12 m at 19.8 g/t Au in drill hole SGRD761 from 156 m, including:
  • One m at 52.1 g/t Au from 162 m;
  • Three m at 52.9 g/t Au from 164 m;
• Four m at 57.7 g/t Au in drill hole SGRD748 from 202 m, including:
  • Two m at 114.2 g/t Au from 202 m;
• 15 m at 10.9 g/t Au in drill hole SGRD747 from 226 m, including:
  • Three m at 39.8 g/t Au from 238 m;
  • A separate interval of four m at 9.2 g/t Au from 245 m;
• 22 m at 6.5 g/t Au in drill hole SGRD740 from 187 m:
  • Six m at 7.8 g/t Au from 213 m;
• 11 m at 8.2 g/t Au in drill hole SGRC760 from 177 m, including:
  • Two m at 37.6 g/t Au from 182 m.

Seguela regional reconnaissance

Scout RC drilling has recently been completed at Winy and will progressively work across the high-priority Seguela prospects. This testwork program is following up on the mapping and reconnaissance sampling at Seguela, which continue to emphasize the regional prospectivity of the property package with several prospects identified where rock chip samples recorded several instances of high-grade visible gold. In addition to continuing detailed field mapping, auger drilling is under way, targeting the southern extensions of key favourable structural corridors that host the Antenna, Ancien-Boulder-Agouti and Elephant-Winy mineralization. Follow-up scout RC drilling is planned in the latter part of the year across these prospects.

Boussoura project

Located approximately 190 kilometres south of Yaramoko, RC and core drilling at the Boussoura project has led to a new high-grade discovery at Galgouli and excellent results following up historic drilling at Fofora (refer to company press releases dated Feb. 3 and 20, 2020, and July 29, 2020). The Boussoura project is located in the southern portion of the Hounde greenstone belt in southern Burkina Faso.

Fofora

Drilling resumed at Boussoura in early May after a pause to assess the potential impact of the coronavirus. The program restarted with an RC/DD rig moving to scout drilling, testing three vein sets with coincident artisanal workings, and geophysical and geochemical targets within one km west of the Fofora vein. These targets form part of the large and active three-kilometre-by-three-kilometre artisanal field and are very similar in appearance to the high-grade Fofora vein, consisting of a series of parallel north- to northwest-striking quartz veins and associated shear zones with surface strike expressions of up to 1,000 m.

Mineralization is typically associated with a series of sheared felsic dikes, associated quartz veining, and intense silica alteration and replacement, with a variable dip from steep westerly to approximately 70 degrees east, with coarse gold commonly seen in samples. Two mineralization styles have now been recognized at Fofora, with very broad lower-grade zones (typically 0.5 to 1.0 g/t) extending up to 60 m in width and interpreted as representing siliceous alteration halos to much higher-grade quartz veins (10 to greater than 100 g/t intervals with high levels of coarse gold) over one- to four-metre intervals.

Reconnaissance RC drilling tested vein targets up to two kilometres to the west of the main Fofora vein, with recent results including 12 m at 5.7 g/t from 74 m in BSR-20-RC-FFR-052, 26 m at 1.3 g/t Au from 0 m in BSR-20-RC-FFR-053A, which included three m at 7.1 g/t Au from 14 m, and 17 m at 2.1 g/t Au from BSR-20-RC-FFR-079 from 41 m, with these results increasing the extent of mineralization identified to date (refer to company release dated Sept. 14, 2020).

Reconnaissance drilling is continuing to test targets a further one km west and south with further work to test the balance of the three-kilometre-by-three-kilometre artisanal field planned for Q4 this year, after the conclusion of the rainy season in October.

Highlights from the most recent drilling at Fofora Main include:

• 4.8 m at 26.9 g/t Au in drill hole BSR-20-RD-FFR-040 from 79.5 m, including:
  • 0.8 m at 147 g/t Au from 79.5 m, in addition to:
  • 1.9 m at 7.3 g/t Au from 42.7 m;
  • 6.0 m at 2.5 g/t Au from 57.5 m;
  • Nine m at 2.7 g/t Au from 182 m;
• Nine m at 10.7 g/t Au in drill hole BSR-20-RC-FFR-063 from 71 m, including:
  • One m at 84.1 g/t Au from 77 m;
• 12 m at 5.7 g/t Au in drill hole BSR-20-RC-FFR-052 from 74 m, including:
  • Two m at 33.4 g/t Au from 74 m;
• 22 m at 2.1 g/t Au in drill hole BSR-20-RC-FFR-062 from 40 m, including:
  • One m at 35.4 g/t Au from 45 m;
• 6.7 m at 6.4 g/t Au in drill hole BSR-19-DD-FFR-011 from 244.3 m, including:
  • 0.4 m at 94 g/t Au from 249.6 m;
• 14 m at 3.0 g/t Au in drill hole BSR-20-RC-FFR-070 from two m, including:
  • Two m at 13.5 g/t Au from eight m.

Highlights from the most recent drilling at Fofora scout drilling include:

• 12 m at 5.7 g/t Au in drill hole BSR-20-RC-FFR-052 from 74 m, including:
  • Two m at 33.4 g/t Au from 74 m;
• 15 m at 1.0 g/t Au in drill hole BSR-20-RC-FFR-051 from 54 m:
  • Four m at 6.0 g/t Au from 94 m;
• 30 m at 1.3 g/t Au in drill hole BSR-20-RC-FFR-053A from zero m, including:
  • Two m at 10.0 g/t Au from 14 m;
  • Two m at 11.4 g/t Au from 74 m;
• Eight m at 2.1 g/t Au in drill hole BSR-20-RC-FFR-060 from 16 m;
• 16 m at 1.0 g/t Au in drill hole BSR-20-RC-FFR-076 from 22 m;
• 17 m at 2.1 g/t Au in drill hole BSR-20-RC-FFR-079 from 41 m.

Galgouli

Exploration activities at Galgouli during the quarter focused on extending auger drilling and soil geochemistry sampling across a five-kilometre-by-seven-kilometre grid, extending along strike to the southeast of the high-grade Galgouli vein. Auger drilling is continuing, with results highlighting several elongate one- to two-kilometre-long anomalies with similar strike orientations to the northwest-striking Galgouli vein, with peak results greater than 500 parts per billion. These auger geochemistry results highlight the potential strike extensions of the Galgouli mineralization. This program will continue, weather depending, with follow-up scout RC drilling planned for Q4 after the end of the rainy season.

Yaramoko exploration

A review of near-surface mineralization opportunities across the Yaramoko complex identified several prospects for further work to advance potential open-pit opportunities, including the near-surface portion of the 55 Zone, to complement the high-grade underground operation. Several other early-stage opportunities have been identified across the Yaramoko property as part of a regional targeting exercise that will be followed up over the next 12 months to assess further near-surface mineralization opportunities. A RC drilling campaign testing the extent of mineralization in the near-surface portion of the 55 Zone was completed and intersected several high-grade intervals close to surface and above zones previously mined from underground of the 55 Zone. (Refer to the company release dated Sept. 30, 2020.)

Highlights from the RC drilling at 55 Zone include:

• Six m at 77.2 g/t Au in drill hole YRM-19-RC-55Z-003 from 38 m, including:
  • 1.0 m at 107 g/t Au from 39 m;
  • 1.0 m at 220 g/t Au from 42 m;
• Six m at 49.5 g/t Au in drill hole YRM-19-RC-55Z-005 from 41 m;
• Six m at 7.2 g/t Au in drill hole YRM-19-RC-55Z-006 from 40 m, including:
  • 1.0 m at 30.2 g/t Au from 41 m;
• 11 m at 10.1 g/t Au in drill hole YRM-19-RC-55Z-012 from 14 m;
• Four m at 16.2 g/t Au in drill hole YRM-19-RC-55Z-017 from 40 m;
• Four m at 7.5 g/t Au in drill hole YRM-19-RC-55Z-018 from 30 m;
• Two m at 29.5 g/t Au in drill hole YRM-19-RC-55Z-019 from 41 m, including:
  • One m at 56.1 g/t Au from 41 m;
• Three m at 11.3 g/t Au from 35 m in drill hole YRM-19-RC-55Z-004;
• Seven m at 3.6 g/t Au from 15 m in drill hole YRM-19-RC-55Z-020;
• Seven m at 6.6 g/t Au from 36 m in drill hole YRM-19-RC-55Z-032;
• Seven m at 5.0 g/t Au from 40 m in drill hole YRM-19-RC-55Z-034;
• Six m at 23.8 g/t Au from 13 m in drill hole YRM-19-RC-55Z-052.

Conference call and webcast information

The company will host a conference call and live webcast on Nov. 11, 2020, at 8 a.m. ET, to discuss its financial results and business outlook.

Listeners may access a live webcast of the conference call from the events section of the company's website or participate in the live conference call by dialling toll-free 1-844-607-4367 within North America or 1-825-312-2266 from international locations. Registration is open through the live call, but to ensure you are connected for the full call, the company suggests registering a minimum of 10 minutes before the start of the call.

An on-line archive of the webcast will be available by accessing the company's website. A telephone replay will be available for two weeks after the call by dialling toll-free 1-800-585-8367 within North American or 1-416-621-4642 from international locations and entering passcode 8835548.

Notes

(1) For the three- and nine-month periods ended Sept. 30, 2019, gold ounces sold and gold sales include precommercial production ounces sold of 5,423 ounces and 10,144 ounces, respectively, and revenues of $7.9-million and $14.2-million, respectively. The precommercial production gold sales and mine operating expenses were accounted against property, plant and equipment.

(2) The company provides some non-IFRS measures as supplementary information that management believes may be useful to investors to explain the company's financial results. Please refer to Note 15 (non-IFRS financial performance measures) of the company's MD&A dated Nov. 10, 2020, available on the company's website or on SEDAR for reconciliation of these measures.

(3) For the three- and nine-month period ended Sept. 30, 2019, mine operating profit includes $2.0-million and $3.3-million, respectively, relating to Bagassi South preproduction revenue net of expenses related to the 5,423 ounces and 10,144 ounces sold, respectively.

(4) As at Sept 30, the company had 3,320 ounces of gold on hand, valued at $6.3-million.

Qualified persons

Paul Criddle, FAusIMM, chief operating officer for Roxgold, a qualified person within the meaning of National Instrument 43-101, has reviewed, verified and approved the technical disclosure contained in this news release.

Paul Weedon, MAIG, vice-president, exploration, for Roxgold, a qualified person within the meaning of National Instrument 43-101, has verified and approved the technical disclosure contained in this news release. This includes the quality assurance/quality control, sampling, analytical and test data underlying this information. For more information on the company's QA/QC and sampling procedures, please refer to the company's annual information form dated Dec. 31, 2019, available on the company's website and on SEDAR.

For further information regarding the Yaramoko gold mine, please refer to the technical report dated Dec. 20, 2017, and entitled "Technical Report for the Yaramoko Gold Mine, Burkina Faso," and the technical report prepared for the Seguela gold project entitled "NI 43-101 Technical Report, Seguela Project, Preliminary Economic Assessment, Worodougou Region, Cote d'Ivoire," dated April 14, 2020, available on the company's website and on SEDAR.

About Roxgold Inc.

Roxgold is a Canadian-based gold mining company with assets located in West Africa. The company owns and operates the high-grade Yaramoko gold mine located on the Hounde greenstone belt in Burkina Faso and is advancing the development and exploration of the Seguela gold project located in Ivory Coast. Roxgold trades on the Toronto Stock Exchange under the symbol ROXG and as ROGFF on the OTCQX.

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