Osisko Mining Corporation

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Osisko Reports Third Quarter 2013 Results

MONTREAL, QUEBEC -- (Marketwired) -- 11/08/13 -- Osisko Mining Corporation (the "Company" or "Osisko") (TSX: OSK)(FRANKFURT: EWX) today reported net earnings of $9.8 million ($0.02 per share) for the third quarter of 2013 compared to $28.3 million ($0.07 per share) for the corresponding period of 2012. The Company generated cash flows from operating activities of $70.7 million during the third quarter of 2013 compared to $55.8 million in the third quarter of 2012.

Q3 Highlights


--  Record gold production of 120,208 ounces at operating cash costs of $754
    per ounce;
--  Earnings from Canadian Malartic of $39.0 million;
--  Operating cash flows of $70.7 million;
--  Free cash flows(1 ) of $32.4 million;
--  Net earnings of $9.8 million or $0.02 per share;
--  Investment of $38.3 million in mining assets and projects;
--  Record tonnage processed at 4.7 million tonnes (average of 54,133 tonnes
    per operating day);
--  Final deposit of $11.6 million to cover the future rehabilitation costs
    of the Canadian Malartic mine, for a total deposit to date of $46.4
    million, representing 100% of the required guarantee;
--  2013 gold production estimated at 485,000 ounces;
--  On track to deliver over $80.0 million capital expenditure reduction
    program;
--  Agreement to reschedule payments of $225.0 million in long-term debt;
--  Cash resources now stand at $171.6(2 ) million.

Sean Roosen, President and Chief Executive Officer commenting on the third quarter results: "Canadian Malartic operations continue to evolve in accordance with our plan. We continue to improve in all facets of the operations: safety performance, community relations, mill availability and throughput. We achieved record gold output during the period. Despite softness in the gold markets, we delivered strong cash flow from operations of $70.7 million. We will continue our efforts to optimize operations and costs to ensure that Canadian Malartic delivers strong sustained cash flows for our shareholders."

The mine operating statement for the production period is as follows:


----------------------------------------------------------------------------
                         2013                    2012 (Restated)(3 )
                                         -----------------------------------
                    Q3       Q2       Q1       Q4       Q3       Q2      Q1
              --------------------------------------------------------------
Gold sales
 (ounces)      123,151  109,503   95,511  111,104   95,424   95,675  92,400
Silver sales
 (ounces)      117,750   95,205   73,683   74,100   49,751   48,880  52,800
----------------------------------------------------------------------------
                 ($000)   ($000)   ($000)   ($000)   ($000)   ($000)  ($000)
              --------------------------------------------------------------
Revenues       171,298  159,195  159,381  191,080  158,503  157,134 158,658
----------------------------------------------------------------------------

Production
 costs         (92,265) (90,619) (81,422) (95,307) (77,684) (89,494)(69,932)
Royalties       (2,144)  (2,274)  (1,992)  (2,546)  (1,998)  (2,021) (2,359)
Depreciation   (37,902) (23,683) (20,982) (20,058) (15,318) (15,635)(13,909)
              --------------------------------------------------------------
Total         (132,311)(116,576)(104,396)(117,911) (95,000)(107,150)(86,200)
----------------------------------------------------------------------------
Earnings from
 mine
 operations     38,987   42,619   54,985   73,169   63,503   49,984  72,458
----------------------------------------------------------------------------

Key operating results

(in thousands of Canadian dollars, unless otherwise noted)


----------------------------------------------------------------------------
                        Q3      Q2        Q1      Q4      Q3      Q2      Q1
                       2013    2013     2013    2012    2012    2012    2012
                   ---------------------------------------------------------
Gold production
 (oz)               120,208 111,701  106,047 101,544 103,753  92,003  91,178
Gold sales (oz)     123,151 109,503   95,511 111,104  95,424  95,675  92,400
Average sale price
 (US$/oz)             1,321   1,396    1,627   1,709   1,659   1,605   1,698
Average market
 price (US$/oz)       1,326   1,415    1,632   1,722   1,652   1,609   1,691
Cash costs per
 ounce(3,4 )
 (C$/oz)                754     781      804     833     851     892     821
Cash costs per
 ounce(3,4,5)
 (US$/oz)               726     765      798     840     855     883     820
Cash margin per
 ounce(3,4)
 (US$/oz)               595     631      829     869     804     722     878
Revenues            171,298 159,195  159,381 191,080 158,503 157,134 158,658
Earnings from mine
 operations(3)       38,987  42,619   54,985  73,169  63,503  49,984  72,458
Net earnings
 (loss)(3)            9,755(492,762)  17,416  12,866  28,343  18,984  30,595
Net earnings (loss)
 per share(3)          0.02   (1.13)    0.04    0.03    0.07    0.05    0.08
Operating cash
 flows(3)            70,665  55,947   62,478  64,608  55,806  68,212  82,879
----------------------------------------------------------------------------

The mill operating team continues to work at improving the mill throughput and availability. September was a very strong month with the average throughput rate exceeding the 55,000 tonnes per day name plate capacity by 5.3%. The mine generated earnings of $39.0 million during the quarter (YTD: $136.6 million), compared to $63.5 million in the corresponding period in 2012 (YTD 2012: $185.9 million). The decrease in profitability is due to a 20.4% (YTD: 13.2%) decline in the US$ price realized on the sale of gold and higher depreciation charges due to increased gold output.

During the quarter, approximately 5,180 equipment hours (6.8% of available hours) were lost due to noise and weather constraints, compared to 4,470 equipment hours (5.9% of available hours) in the second quarter of 2013 and 5,830 (6.0% of available hours) equipment hours in the third quarter of 2012.

The production statistics are as follows:


----------------------------------------------------------------------------
                            Q3      Q2      Q1      Q4      Q3     Q2     Q1
                          2013    2013    2013    2012    2012   2012   2012
                      ------------------------------------------------------
Tonnes Mined (000's)
- Ore                    4,423   3,604   4,091   3,553   4,853  3,234  4,037
- Waste(6 )             11,335  10,010  10,158   7,847   9,215  9,545  8,458
                      ------------------------------------------------------
Total Mined             15,758  13,614  14,249  11,400  14,068 12,779 12,495
Overburden                 305     871   1,783     627   1,409  1,740  1,954
Tonnes Milled (000's)    4,683   4,444   4,234   4,088   3,757  3,236  2,965
Grade (g Au/t)            0.90    0.87    0.88    0.87    0.97   0.99   1.05
Recovery (%)              89.2    89.7    88.0    88.8    88.7   89.2   91.2
Gold production (oz)   120,208 111,701 106,047 101,544 103,753 92,003 91,178
----------------------------------------------------------------------------

The third quarter tonnes mined constitute a record for the mine. However, mining activities continue to be affected by challenging conditions due to operating close to an urban area and working over old underground stopes.

Production in the third quarter of 2013 improved to an average 54,133 tonnes per operating day compared to 52,592 tonnes per operating day in the previous quarter and 43,181 tonnes per operating day in the third quarter of 2012. Continued optimization of operations at the mill, the two cone crushers and the additional pebble crusher installed in 2012 allowed the mill to reach new records in the third quarter. In coordination with the technical advisors, the Canadian Malartic team continues to work on improving the mill throughput and enhancing operating efficiencies.

Mill operating statistics continue to show progress in all categories.


----------------------------------------------------------------------------
               Total                       Tonnage   Tonnes per   Tonnes per
           Available    Operating        Processed    Operating    Operating
               Hours        Hours   (%)        (t)         Hour          Day
----------------------------------------------------------------------------
Q3 2013        2,208        2,061    93  4,682,530        2,272       54,133
Q2 2013        2,184        2,014    92  4,444,042        2,207       52,592
Q1 2013        2,160        2,082    96  4,234,001        2,033       48,667
Q4 2012        2,208        2,052    93  4,088,021        1,992       47,535
Q3 2012        2,208        2,071    94  3,756,768        1,814       43,181
Q2 2012        2,184        1,960    90  3,236,281        1,651       38,074
Q1 2012        2,184        1,890    87  2,965,456        1,569       35,728
----------------------------------------------------------------------------

Operating Costs

Cash costs per ounce(7) for the third quarter and the first nine months of 2013 stood at $754 and $779 respectively, compared to $851(8 ) and $855(8) in the corresponding periods of 2012. The improvement over the comparative periods in 2012 is mainly the result of increased throughput and gold production, improved efficiencies and reduction in contractors' costs.

The Company continues to pursue operating efficiencies, and has intensified its cost optimization program as the operations are now at near name plate capacity. Management expects that operating costs will continue to decline over the next year as it reaps the benefits of its optimization and cost reduction efforts.

Adjusted Net Earnings(9 )

Excluding specific non-cash items, adjusted net earnings(9 ) amounted to $21.9 million ($0.05 per share) during the third quarter of 2013 compared to $50.4 million ($0.13 per share) in the third quarter of 2012.


----------------------------------------------------------------------------
                             Three Months Ended        Nine Months Ended
(In thousands of dollars,
 except for amounts per
 share)
                          --------------------------------------------------
                             Sept. 30,   Sept. 30,    Sept. 30,    Sept. 30,
                                  2013        2012         2013         2012
                          --------------------------------------------------
Net earnings (loss)              9,755      28,343     (465,591)      77,922
Impairment of Hammond Reef
 gold project                        -           -      530,878            -
Write-off of property,
 plant and equipment             1,926         102       17,000          719
Share-based compensation         2,038       2,273        6,059        7,612
Unrealized loss on
 investments                       185        (830)       2,141        1,095
Impairment on available-
 for-sale assets                 1,348         428        4,632        1,522
Deferred income and mining
 tax expense (recovery)          6,600      20,117      (12,034)      56,838
                          --------------------------------------------------
Adjusted net earnings(9)        21,852      50,433       83,085      145,708
                          --------------------------------------------------
Adjusted net earnings per
 share(9)                         0.05        0.13         0.19         0.38
----------------------------------------------------------------------------

The decrease in adjusted net earnings(9 ) is mainly the result of lower average selling prices of gold during the third quarter of 2013 and higher depreciation charges.

Investments

The Company invested $38.3 million in property, plant and equipment during the third quarter. These investments were mainly focused on the Canadian Malartic mine (stripping costs, sustaining capital and expansion) and the Kirkland Lake and Upper Beaver exploration projects.

Volatility in the gold price and financial markets earlier this year has led Osisko to review in April its rate of discretionary spending in exploration and advancing new projects. As previously announced, the Company is decreasing discretionary spending for 2013 by over $80 million.

Upper Beaver Project and Kirkland Lake - Larder Camp

On December 28, 2012, Osisko completed the acquisition of Queenston Mining Inc. As part of the transaction, the Company acquired the Upper Beaver Project and a package of lands covering 230 km2 in the rich Kirkland Lake Gold Camp, which has produced in the past over 40 million ounces. Queenston had consolidated the land package over the past 20 years. To date, there have been several satellite deposits identified that could feed a regional mill. Queenston Mining Inc. changed its name to Osisko Mining Ltd. on January 16, 2013.

The work at Upper Beaver is focused on drilling deep holes to test extensions of known zones. The Company has completed approximately 34,795 meters of drilling since January 1, 2013. Work is currently limited to compiling information generated during the 2013 drilling phase, and to review the geological data for the entire camp.

Construction of the head frame and surface facilities has been delayed. The shaft sinking has also been delayed following the completion of the shaft collar. The pause in the project execution plan allows for the review of the construction and development approach with the aim of reducing the capital outlays. This reassessment period will result in a deferral of approximately $50 million of the planned Upper Beaver outlays of $70 million for 2013.

The Company has completed 70,506 meters on various regional targets in the Kirkland Lake - Larder camp, including 2,430 meters in the third quarter of 2013. Drilling activities have been reduced to focus on compilation and assessment of the results. The exploration expenditures at Kirkland Lake for 2013 are estimated at the original budget of $20 million.

Hammond Reef Gold Project

Osisko acquired the Hammond Reef gold project located near Atikokan in Northwestern Ontario, through the acquisition of publicly traded Brett Resources Inc. in mid 2010 for $375.0 million. Hammond Reef is a large development project with potential to become a substantial open-pit mine. In the third quarter of 2013, efforts were focused on the preparation of the feasibility study and the publication of the environmental assessment report.

A new resource estimate for Hammond Reef was released on January 28, 2013. As per the estimate, global measured and indicated resources currently stand at 5.43 million ounces gold at an average grade of 0.86 g/t Au and the global inferred resource stands at 1.75 million ounces gold at an average grade of 0.72 g/t (based on 0.50 g/t Au lower cut-off).

Hammond Reef Global Resource Estimates


----------------------------------------------------------------------------
Category             Grade (g/t)     Tonnes (M)    Cut-off (g/t)      Oz (M)
----------------------------------------------------------------------------
Measured                    0.90          123.5              0.5        3.59
----------------------------------------------------------------------------
Indicated                   0.78           72.9              0.5        1.83
----------------------------------------------------------------------------
M+I                         0.86          196.4              0.5        5.43
----------------------------------------------------------------------------
Inferred                    0.72           75.7              0.5        1.75
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Further, a whittle pit optimized undiluted resource was calculated (US$1,400 whittle pit shell), totaling 5.31 million ounces of gold at an average grade of 0.72 g/t in the measured and indicated category, and 0.28 million ounces of gold at an average grade of 0.65 g/t in the remaining inferred category.

Hammond Reef Undiluted Resource Estimates within US$1,400 Whittle pit shell


----------------------------------------------------------------------------
Category             Grade (g/t)     Tonnes (M)    Cut-off (g/t)      Oz (M)
----------------------------------------------------------------------------
Measured                    0.75          175.3             0.32        4.25
----------------------------------------------------------------------------
Indicated                   0.61           54.1             0.32        1.06
----------------------------------------------------------------------------
M+I                         0.72          229.5             0.32        5.31
----------------------------------------------------------------------------
Inferred                    0.65           13.3             0.32        0.28
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Osisko's technical team is progressing on the feasibility study for the project. Due to significant inflation in the mineral industry over the past few years, the preliminary estimate of capital cost for a 60,000 tonnes per day operation ranges between $1.5 and $1.8 billion. Gold output is estimated to average 400,000 ounces per annum at a production cost of $800 to $850 per ounce. The group is continuing to review alternatives to optimize capital costs and improve the returns. Under the current scenario, the Hammond Reef gold project requires higher gold prices to justify the investment.

Based on preliminary feasibility results and current market conditions in the gold sector, the Company undertook a review of the project during the second quarter. The Company conducted impairment testing of Hammond Reef in conformity with IFRS practices and determined that an impairment charge of $487.8 million, net of a deferred tax recovery of $43.1 million, was necessary. Accordingly, the project value recorded on the Company's books was reduced to nil.

The Company will continue to pursue low-cost permitting activities in the near-term and will continue to monitor market conditions.

Exploration

Prior to mid 2009, the Company's efforts were focused solely on the development of its flagship asset, the Canadian Malartic mine. Following the securing of the financing, the necessary authorizations and the construction release, the Company began to seek other opportunities to complement the Canadian Malartic mine. The overall objective is for Osisko to achieve the status of a leading intermediate gold producer with annual production of 1 million ounces. The principle strategy is to create value through the identification and development of gold reserves and resources.

To build on its gold mining asset base, the Company has acquired advanced exploration projects, has entered into exploration agreements, staked ground, and invested in various public and private exploration companies with promising gold projects. Osisko continues to focus its efforts on its new Kirkland Lake area properties and its Guerrero Gold Belt properties in Mexico.

In Guerrero, Osisko continues to pursue initial grassroot activities including trenching and sampling, studying geochemistry and geophysical data, identifying drill targets and conducting initial drilling. Efforts were hampered by adverse weather conditions, which severely impacted local infrastructures. Osisko is working with various communities to repair these infrastructures, meanwhile the exploration program has resumed in October.

Osisko enjoys flexibility on its major projects, a benefit of being the sole owner, and thus can select the rate of execution of its investment programs without concern for compromising ownership rights.

Liquidity and Capital Resources

As at September 30, 2013, the Company's cash and cash equivalents, short-term investments and restricted cash amounted to $171.6 million compared to $155.5 million as at December 31, 2012, as summarized below:


(In thousands of dollars)           September 30, 2013     December 31, 2012


Cash and cash equivalents                      121,770                93,229
Short-term investments                               -                19,357
Restricted cash
  Current                                          558                 4,563
  Non-current                                   49,262                38,362
                               ---------------------------------------------
                                               171,590               155,511

Short-term investments were acquired as part of the acquisition of Queenston as at December 28, 2012 and were converted into cash and cash equivalents during the first quarter of 2013 to increase the flexibility of available liquidities. In June the Company also collected the $30.0 million note receivable from Kirkland Lake Gold Inc. related to the sale of properties by Queenston prior to its acquisition by Osisko.

On July 5, 2013, Osisko deposited $11.6 million with the Government of Quebec, representing the balance of the total guarantee required to cover the entire future costs of rehabilitating the Canadian Malartic mine site. The aggregate deposits with the Government of Quebec amount to $46.4 million. Osisko is the first mining company in Quebec to deposit its full financial guarantee at commencement of operations, exceeding the legislation currently in force in Quebec.

Modifications to long-term debt terms

In July 2013, the Company entered into agreements with CPPIB Credit Investments Inc. ("CPPIB"), the Caisse de depot et placement du Quebec ("CDPQ") and Ressources Quebec ("RQ") to modify certain terms of its long-term debt facilities. These modifications have not been reflected in the financial statements yet and the Company will assess the financial impact of the amendments on its consolidated financial statements on the closing date of the agreements.


--  CPPIB loan ($150.0 million)

    --  The loan repayments that were previously based on cash flow
        availability will now be based on pre-determined fixed amounts. The
        first repayment will be postponed to 2014.
    --  The fixed interest rate will be revised to 6.875% (from 7.5%
        previously).
    --  The maturity date of the 12.5 million warrants held by CPPIB will be
        extended to September 30, 2017 and the exercise price will be
        modified to $6.25 per warrant. The exercise of the warrants may be
        accelerated at the Company's option if the Osisko shares trade at a
        price above $8.15 for 20 consecutive days.
    --  The delayed drawdown facility ($100.0 million) established in May
        2012 will be cancelled;
    --  The maturity date of the loan will be postponed to June 30, 2017.

--  Convertible debentures ($75.0 million)

    --  The maturity date of the convertible debentures will be postponed to
        November 2017.
    --  The fixed interest rate will be revised to 6.875% (from 7.5%
        previously).
    --  The convertible debentures will be convertible into Osisko shares at
        any time prior to the due date at the price of $6.25 per share
        (previously $9.18 per share).

The following table presents the new repayment schedules of the CPPIB loan and the convertible debentures per calendar year once the agreements are finalized: (in millions of dollars):


                                   CPPIB        CDPQ          RQ       Total

----------------------------------------------------------------------------

2014                                30.0           -           -        30.0
2015                                40.0           -           -        40.0
2016                                40.0           -           -        40.0
2017                                40.0        37.5        37.5       115.0
                            ------------------------------------------------
                                   150.0        37.5        37.5       225.0

The agreements are conditional on finalization of documentation to the satisfaction of all parties, obtaining the necessary regulatory authorizations and on payment of transaction fees, which are expected to be all completed by the end of the month of November 2013.

Outlook for 2013

In accordance with the operating plan and the ongoing optimization program, the mill should be operating at the 55,000 tonnes per day name plate capacity during the fourth quarter of 2013. Gold production is estimated at 485,000 ounces for the year. Cash costs per ounce(10 ) are estimated at approximately $770, a 9% reduction in costs from 2012 with improved operations and higher gold output.

Following the issuance of a new IFRS accounting pronouncement with respect to stripping costs in the production phase of a surface mine, the Company capitalizes stripping costs when they meet the requirements of a stripping activity asset. Capitalized stripping costs are not reflected in the table below. The change in policy has no impact on cash and cash equivalents.

Volatility in the gold price and financial markets in 2013 has led Osisko to review its rate of discretionary spending in exploration and advancing new projects. As a result, the Company decreased discretionary spending for 2013 by over $80 million.

Capital expenditures for 2013 are now estimated at $138 million as follows:


                                             Revised    Original
(in millions of dollars)                   budget(a)      budget   Reduction
----------------------------------------------------------------------------

Canadian Malartic mine                          80.8        98.0        17.2
Upper Beaver project                            18.5        70.0        51.5
Hammond Reef                                     7.0        10.0         3.0
Exploration - capitalized                       31.6        42.0        10.4
                                        ------------------------------------
Capital expenditures                           137.9       220.0        82.1

(a)  Excluding variation in accounts payable related to the Canadian
     Malartic expansion, Hammond Reef, Upper Beaver and Kirkland Lake
     projects.

Outstanding Share Data

As of November 8, 2013, 437,763,999 common shares were issued and outstanding. A total of 23,100,695 common share options were outstanding to purchase common shares under the Company's share option plan and 12,500,000 common share purchase warrants were outstanding.

Q3 Conference Call Information

Osisko will host a conference call on Friday, November 8, 2013 at 14:00 ET, where senior management will discuss the financial results and provide an update of the Company's activities. Those interested in participating in the conference call should dial in approximately five to ten minutes before the start of the conference to allow ample time to access at 1 416 981 9000 (Toronto local and international), or 800 736 4610 (North American toll free). An operator will direct participants to the call.

The conference call replay will be available from 16:00 ET on November 8, 2013 until 23:59 ET on November 22, 2013 with the following dial in number: 1 416 626 4100 or toll-free 800 558 5253, access code 21676744.

Non-IFRS Measures of Performance

The Company has included certain non-IFRS measures including "cash costs per ounce", "cash margin per once", "adjusted net earnings" and "adjusted net earnings per share" to supplement its consolidated financial statements, which are presented in accordance with IFRS.

The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Cash costs per ounce

"Cash costs per ounce" is defined as the production costs of one ounce of gold excluding non-cash costs for a certain period. "Cash costs per ounce" is obtained from "Production costs" and "Royalties" less non-cash "Share-based compensation" and "By-product credits (silver sales)", adjusted for "Production inventory variation" for the period, divided by the "Number of ounces of gold produced" for the period.


                                   Three months ended     Nine months ended
                                        September 30,         September 30,
                                     2013        2012      2013        2012

                                 -------------------------------------------

Gold ounces produced              120,208     103,753   337,956     286,934

(in thousands of dollars, except
 per ounce)

Production costs                   92,265      77,684   264,306     237,110
Royalties                           2,144       1,998     6,410       6,378
Share-based compensation             (559)       (696)   (1,820)     (2,230)
By-product credit (silver sales)   (2,620)     (1,479)   (7,066)     (4,634)
Inventory variation                  (573)     10,785     1,384       8,656
                                 -------------------------------------------

Total cash costs for the period    90,657      88,292   263,214     245,280

Cash costs per ounce                  754         851       779         855

Cash margin per ounce

"Cash margin per ounce" is defined as the "Average selling price of gold per ounce sold" less "Cash costs per ounce produced" for the period.


                                      Three months ended   Nine months ended
                                           September 30,       September 30,
                                          2013      2012      2013      2012

                                    ----------------------------------------


Average selling price of gold (per
 ounce sold)                             1,370     1,646     1,471     1,657

Cash costs (per ounce produced)            754       851       779       855
                                    ----------------------------------------

Cash margin per ounce                      616       795       692       802

Adjusted net earnings and adjusted net earnings per share

"Adjusted net earnings" is defined as "Net earnings" less certain non-cash items: "Write-off of property, plant and equipment", "Share-based compensation", "Unrealized gain (loss) on investments", "Impairment on available-for-sale assets", and "Deferred income and mining tax expense (recovery)".

"Adjusted net earnings per share" is obtained from the "Adjusted net earnings" divided by the "Weighted average number of common shares outstanding" for the period.


                                     Three months ended    Nine months ended
                                          September 30,        September 30,
                                           2013    2012      2013       2012

                                     ---------------------------------------
(in thousands of dollars, except per
 share amounts)

Net earnings (loss) for the period        9,755  28,343  (465,591)    77,922

Adjustments:
  Impairment of property, plant and
   Equipment                                  -       -   530,878          -
  Write-off of property, plant and
   equipment                              1,926     102    17,000        719
  Share-based compensation                2,038   2,273     6,059      7,612
  Unrealized loss (gain) on
   investments                              185    (830)    2,141      1,095
  Impairment on available-for-sale
   assets                                 1,348     428     4,632      1,522
  Deferred income and mining tax
   expense (recovery)
                                     ---------------------------------------
    Related to the impairment of
     property, plant and equipment            -       -   (43,100)         -
    Other                                 6,600  20,117    31,066     56,838

Adjusted net earnings                    21,852  50,433    83,085    145,708

Weighted average number of common
 shares outstanding (000's)             437,186 388,153   436,797    387,588
                                     ---------------------------------------

Adjusted net earnings per share            0.05    0.13      0.19       0.38

About Osisko Mining Corporation

Osisko Mining Corporation operates the Canadian Malartic Gold Mine in Malartic, Quebec and is pursuing exploration on a number of properties in Ontario and Mexico.

Mr. Luc Lessard, Eng., Senior Vice-President and Chief Operating Officer of Osisko, is the Qualified Person who has reviewed this news release and is responsible for the technical information reported herein, including verification of the data disclosed.

Cautionary Notes Concerning Estimates of Mineral Resources

This news release uses the terms measured, indicated and inferred resources as a relative measure of the level of confidence in the resource estimate. Readers are cautioned that mineral resources are not economic mineral reserves and that the economic viability of resources that are not mineral reserves has not been demonstrated. In addition, inferred resources are considered too geologically speculative to have any economic considerations applied to them. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies or economic studies except for Preliminary Assessment as defined under NI 43-101. Readers are cautioned not to assume that that further work will lead to mineral reserves that can be mined economically.

For further information in relation to the Hammond Reef project, please refer to the "Technical Report on the Hammond Reef Gold Property Atikokan area, Ontario" dated December 20, 2011. For further information in relation to the Canadian Malartic project, please refer to the "Feasibility Study - Canadian Malartic Project (Malartic, Quebec)", dated December 2008. Both of these reports are available under the Osisko profile at www.sedar.com.

For further information in relation to the Upper Beaver project, please refer to the "Technical Report on the Upper-Beaver Gold-Copper Project, Ontario, Canada" dated November 9, 2012, which is available under the Queenston profile at www.sedar.com.

Forward-Looking Statements

Certain statements contained in this press release may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that Osisko expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "scheduled" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur including, without limitation, continued decline in operating costs as a result of optimization and cost reductions efforts will allow the Canadian Malartic Mine to deliver strong sustained cash flows, that exploration work would lead to commercial production of several satellite deposits identified in the Kirkland Lake gold camp which could feed a regional mill, that exploration expenditures at Kirkland Lake will be on target with the original budget, that the Company will be successful in reviewing alternatives to optimize the Hammond Reef preliminary estimate of capital cost for a 60,000 tonnes per day operations and improve the returns, that the Company will be successful in finalizing the modifications to its long-term debt terms, that the Canadian Malartic mill should be operating at the 55,000 tonnes per day name plate capacity during the fourth quarter of 2013, that the Company will produce 485,000 ounces of gold in 2013 at cash costs per ounce of approximately $770, and that the capital expenditures estimate for 2013 will total $138 million.

Although Osisko believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, including, without limitation, that all technical, economical and financial conditions will be met in order to achieve such events qualified by the foregoing cautionary note regarding forward looking statements, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include gold prices, access to skilled consultants, mining development and construction personnel, results of exploration and development activities, Osisko's limited experience with production and mining operations, uninsured risks, regulatory framework and changes, defects in title, availability of personnel, materials and equipment, timeliness of government approvals, actual performance of facilities, equipment and processes relative to specifications and expectations, unanticipated environmental impacts on operations market prices, continued availability of capital and financing and general economic, market or business conditions. These factors are discussed in greater detail in Osisko's most recent Annual Information Form and in the most recent Management Discussion and Analysis filed on SEDAR, which also provide additional general assumptions in connection with these statements. Osisko cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Osisko believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.




Osisko Mining Corporation
Consolidated Balance Sheets
(Unaudited)
------------------------------------------------------------
(tabular amounts expressed in thousands of Canadian dollars)


                                         September 30,         December 31,
                                                  2013                 2012
                                  -------------------- ---------------------
                                                            (restated - see
                                                                      note)
                                                     $                    $
Assets
Current assets
   Cash and cash equivalents                   121,770               93,229
   Short-term investments                            -               19,357
   Restricted cash                                 558                4,563
   Accounts receivable                          24,590               32,266
   Note receivable                                   -               30,000
   Inventories                                  73,481               70,481
   Prepaid expenses and other
    assets                                      25,014               21,274
                                  ------------------------------------------
                                               245,413              271,170
Non-current assets
   Restricted cash                              49,262               38,362
   Investments in associates                     8,138                8,933
   Other investments                             8,447               16,894
   Property, plant and equipment             1,876,745            2,352,546
                                  ------------------------------------------
                                             2,188,005            2,687,905
                                  ------------------------------------------
                                  ------------------------------------------

Liabilities
Current liabilities
   Accounts payable and accrued
    liabilities                                 75,657              100,931
   Current portion of long-term
    debt                                        93,963               76,883
   Provisions and other
    liabilities                                  4,003                1,405
                                  ------------------------------------------
                                               173,623              179,219
Non-current liabilities
   Long-term debt                              234,605              260,529
   Provisions and other
    liabilities                                 17,371               18,618
   Deferred income and mining
    taxes                                       55,487               67,521
                                  ------------------------------------------
                                               481,086              525,887
                                  ------------------------------------------
Equity attributable to Osisko
 Mining Corporation shareholders
   Share capital                             2,053,785            2,048,843
   Warrants                                     19,311               19,311
   Contributed surplus                          72,404               65,868
   Equity component of convertible
    debentures                                   8,005                8,005
   Accumulated other comprehensive
    loss                                        (2,134)              (1,148)
   Retained earnings (deficit)                (444,452)              21,139
                                  ------------------------------------------
                                             1,706,919            2,162,018
                                  ------------------------------------------
                                             2,188,005            2,687,905
                                  ------------------------------------------
                                  ------------------------------------------


Osisko Mining Corporation
Consolidated Statements of Income (Loss)
For the three and nine months ended September 30, 2013 and 2012
(Unaudited)
----------------------------------------------------------------------------
(tabular amounts expressed in thousands of Canadian dollars)


                                   Three months ended     Nine months ended
                                            September             September
                                                  30,                   30,
                                --------------------------------------------
                                      2013       2012       2013       2012
                                --------------------------------------------
                                            (restated             (restated
                                                    -                     -
                                            see note)             see note)
                                       ($)        ($)        ($)        ($)

Revenues                           171,298    158,503    489,874    474,295

Mine operating costs
  Production costs                 (92,265)   (77,684)  (264,306)  (237,110)
  Royalties                         (2,144)    (1,998)    (6,410)    (6,378)
  Depreciation                     (37,902)   (15,318)   (82,567)   (44,862)
                                --------------------------------------------
Earnings from mine operations       38,987     63,503    136,591    185,945
  General and administrative
   expenses                         (9,048)    (7,601)   (22,222)   (20,950)
  Exploration and evaluation
   expenses                         (6,081)    (2,852)   (27,119)    (8,105)
  Impairment of property, plant
   and equipment                         -          -   (530,878)         -
                                --------------------------------------------
Earnings (loss) from operations     23,858     53,050   (443,628)   156,890
  Interest income                      387        233      1,270      1,145
  Finance costs                     (8,177)    (7,983)   (24,466)   (22,825)
  Foreign exchange gain (loss)       1,918      3,431     (3,458)     3,160
  Share of loss of associates          (52)      (353)      (796)      (628)
  Other gains (losses)              (1,579)        82     (6,547)    (2,982)
                                --------------------------------------------
Earnings (loss) before income
 and mining taxes                   16,355     48,460   (477,625)   134,760
  Income and mining tax recovery
   (expense)                        (6,600)   (20,117)    12,034    (56,838)
                                --------------------------------------------
Net earnings (loss)                  9,755     28,343   (465,591)    77,922
                                --------------------------------------------

Net earnings (loss) per share
  Basic                               0.02       0.07      (1.07)      0.20
  Diluted                             0.02       0.07      (1.07)      0.20

Weighted average number of
 common shares outstanding (in
 thousands)
  Basic                            437,186    388,153    436,797    387,588
  Diluted                          437,782    390,238    436,797    389,653


Osisko Mining Corporation
Consolidated Statements of Cash Flows
For the three and nine months ended September 30, 2013 and 2012
(Unaudited)
----------------------------------------------------------------------------
(tabular amounts expressed in thousands of Canadian dollars)

                                 Three months ended       Nine months ended
                                          September               September
                                                30,                     30,
                            ------------------------------------------------
                                   2013        2012        2013        2012
                            ------------------------------------------------
                                        (restated -             (restated -
                                                see                     see
                                              note)                   note)
                                    ($)         ($)         ($)         ($)
Operating activities
Net earnings (loss)               9,755      28,343    (465,591)     77,922
Adjustments for:
  Interest income                  (387)       (233)     (1,270)     (1,145)
  Share-based compensation        2,038       2,273       6,059       7,612
  Depreciation                   38,178      15,478      83,280      45,339
  Finance costs                   8,177       7,983      24,466      22,825
  Write-off of property,
   plant and equipment            1,926         102      17,000         719
  Impairment of property,
   plant and equipment                -           -     530,878           -
  Gain on disposal of
   property, plant and
   equipment                        (66)          -        (239)       (319)
  Unrealized foreign
   exchange loss (gain)          (1,915)     (3,644)      3,240      (3,469)
  Share of loss of
   associates                        52         353         796         628
  Net loss (gain) on
   available-for-sale
   financial assets                 161        (670)      1,012        (450)
  Net loss (gain) on
   financial assets at fair
   value through profit and
   loss                              24        (160)      1,129       1,545
  Impairment on available-
   for-sale financial assets      1,348         428       4,632       1,522
  Provisions and other
   liabilities                    2,677       1,797       1,767       1,879
  Income and mining tax
   expense (recovery)             6,600      20,117     (12,034)     56,838
  Other non-cash gain                 -           -        (139)          -
                            ------------------------------------------------
                                 68,568      72,167     194,986     211,446
Change in non-cash working
 capital items                    2,097     (16,361)     (5,896)     (4,549)
                            ------------------------------------------------
Net cash flows provided by
 operating activities            70,665      55,806     189,090     206,897
                            ------------------------------------------------
Investing activities
Net decrease in short-term
 investments                          -           -      19,357           -
Net decrease (increase) in
 restricted cash                (11,611)      4,238      (6,895)      4,749
Proceeds from note
 receivable                           -           -      30,000           -
Acquisition of investments            -      (3,404)          -     (10,950)
Proceeds on disposal of
 investments                          -       1,364       1,045       1,838
Property, plant and
 equipment, net of
 government credits             (38,313)    (58,329)   (163,917)   (206,634)
Proceeds on disposal of
 property, plant and
 equipment                          327           -         695           -
Interest received                   234         232       1,827       1,027
                            ------------------------------------------------
Net cash flows used in
 investing activities           (49,363)    (55,899)   (117,888)   (209,970)
                            ------------------------------------------------
Financing activities
Long-term debt transaction
 costs                             (113)         (6)       (113)       (116)
Long-term debt repayments        (3,082)     (1,250)     (8,634)     (3,750)
Finance lease payments           (7,658)     (5,736)    (20,350)    (16,702)
Issuance of common shares,
 net of expenses                  1,713       8,409       3,096      17,896
Interest paid                    (5,878)     (5,588)    (16,660)    (16,665)
                            ------------------------------------------------
Net cash flows used in
 financing activities           (15,018)     (4,171)    (42,661)    (19,337)
                            ------------------------------------------------
Increase (decrease) in cash
 and cash equivalents             6,284      (4,264)     28,541     (22,410)
Cash and cash equivalents -
 beginning of period            115,486      82,524      93,229     100,670
                            ------------------------------------------------
Cash and cash equivalents -
 end of period                  121,770      78,260     121,770      78,260
                            ------------------------------------------------
                            ------------------------------------------------

Note on restatement of 2012 balances

Balances related to 2012 have been restated to reflect the impact of the adoption of IFRIC 20, Stripping Costs in the Production Phase of a Surface Mine. IFRIC 20 provides guidance on the accounting for the costs of stripping activities during the production phase of surface mining when two benefits accrue to the entity as a result of the stripping: useable ore that can be used to produce inventory and improved access to further quantities of material that will be mined in the future periods. The Company adopted IFRIC 20 effective January 1, 2013. Upon adoption of IFRIC 20, the Company assessed the stripping asset on the balance sheet as at January 1, 2012 and determined that there are identifiable components of the ore body with which this stripping asset can be associated, and therefore no balance sheet adjustment was recorded at that date. The adoption of IFRIC 20 has resulted in increased capitalization of waste stripping costs and a reduction in mine operating costs in 2012. If the Company had not adopted IFRIC 20, the net earnings for the three months ended September 30, 2013 would have decreased, the net loss for the nine months ended September 30, 2013 would have increased the net earnings for the comparative periods would have decreased and capitalized waste stripping costs for the current and comparative periods would have decreased.

The impact of adopting IFRIC 20 in the prior year consolidated financial statements is presented below:

(a) Adjustments to the consolidated balance sheets:


                                          As at                       As at
                                   December 31,    Impact of   December 31,
                                           2012     IFRIC 20           2012
                                  ------------------------------------------
                                    (previously
                                        stated)                  (restated)
                                              $            $              $

Inventories                              73,795       (3,314)        70,481
Property, plant and equipment         2,329,773       22,773      2,352,546
Deferred income and mining taxes        (60,426)      (7,095)       (67,521)
                                                -------------
Increase in retained earnings                         12,364
                                                -------------

(b) Adjustments to the consolidated statements of income:


                                  Three months                 Three months
                                         ended     Impact of          ended
                                 September 30,                September 30,
                                          2012      IFRIC 20           2012
                                   (previously
                                       stated)                   (restated)
                                             $             $              $

Mine operating costs                  (81,841)
  Production costs                    (14,605)         4,157        (77,684)
  Depreciation                        (18,860)          (713)       (15,318)
Income and mining tax expense                         (1,257)       (20,117)
                                              ---------------
Increase in net earnings                               2,187
                                              ---------------
Increase in net earnings per
 share and diluted net earnings
 per share                                              0.01
                                              ---------------




                                    Nine months                  Nine months
                                          ended                        ended
                                  September 30,    Impact of   September 30,
                                           2012     IFRIC 20            2012
                                    (previously
                                        stated)            $      (restated)
                                              $                            $
Mine operating costs
   Production costs                    (252,588)      15,478       (237,110)
   Depreciation                         (43,771)      (1,091)       (44,862)
Income and mining tax expense           (51,587)      (5,251)       (56,838)
Increase in net earnings                               9,136
                                                -------------
                                                -------------
Increase in net earnings per
 share and diluted net earnings
 per share                                              0.02
                                                -------------
                                                -------------

(c) Adjustments to the consolidated statements of cash flows:


                                 Three months                  Three months
                                        ended      Impact of          ended
                                September 30,                 September 30,
                                         2012       IFRIC 20           2012
                               ---------------------------------------------
                                  (previously
                                      stated)                    (restated)
                                            $              $              $

Net earnings                           26,156          2,187         28,343
Adjusted for the following
 items:
  Depreciation                         14,765            713         15,478
  Income and mining tax expense        18,860          1,257         20,117
Change in non-cash working
 capital items:
  Increase in inventories             (18,459)        (3,704)       (22,163)
                                              ---------------
Net cash flows provided by
 operating activities                                    453
                                              ---------------
Property, plant and equipment         (57,876)          (453)       (58,329)
                                              ---------------
Net cash flows used in
 investing activities                                   (453)
                                              ---------------
Net change in cash and cash
 equivalents                                               -
                                              ---------------


                                Nine months                     Nine months
                                      ended       Impact of           ended
                              September 30,                   September 30,
                                       2012        IFRIC 20            2012
                            ------------------------------------------------
                                (previously
                                    stated)                      (restated)
                                          $               $               $

Net earnings                         68,786           9,136          77,922
Adjusted for the following
 items:
  Depreciation                       44,248           1,091          45,339
  Income and mining tax
   expense                           51,587           5,251          56,838
Change in non-cash working
 capital items:
  Increase in inventories           (32,174)          1,652         (30,522)
                                            ----------------
Net cash flows provided by
 operating activities                                17,130
                                            ----------------
Property, plant and
 equipment                         (189,504)        (17,130)       (206,634)
                                            ----------------
Net cash flows used in
 investing activities                               (17,130)
                                            ----------------
Net change in cash and cash
 equivalents                                              -
                                            ----------------

(1) Free cash flows represent net cash flows provided by operating activities less property, plant and equipment in the Consolidated Statements of Cash Flows.

(2) Includes cash and cash equivalents and restricted cash

(3) Balances related to 2012 have been restated to reflect the impact of the adoption of IFRIC 20, Stripping Costs in the Production Phase of a Surface Mine

(4) Reconciliation of non-IFRS measures is provided under Non-IFRS Measures of Performance of this press release.

(5) Using the average exchange rate.

(6) Including topographic drilling of 4.0 million tonnes in 2013 and 2.5 million tonnes for the year 2012.

(7) Reconciliation of non-IFRS measures is provided under Note Regarding Certain Non-IFRS Measures of Performance of this press release.

(8) Restated to reflect the adoption of IFRIC 20, Stripping Costs in the Production Phase of a Surface Mine.

(9) Reconciliation of non-IFRS measures is provided under Non-IFRS Measures of Performance of this press release.

(10) Reconciliation of non-IFRS measures is provided under Non-IFRS Measures of Performance of this press release.

Contacts:
Osisko Mining Corporation
John Burzynski
Vice-President Corporate Development
(416) 363-8653

Osisko Mining Corporation
Sylvie Prud'homme
Director of Investor Relations
(514) 735-7131 or Toll Free: 1-888-674-7563
www.osisko.com

Source: Osisko Mining Corporation

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