17 N o t e s 1 I n Q1 2012 t he C o m p a n y a c c r u e d a r o y a lty li a b i l i t y o f 99 a t H o ll o w a y w hi c h wa s i n c ur r e d du r i n g t h e p e r i o d f r o m A ugus t 2 01 1 t o D e c e m b e r 20 11 T hi s a m o un t ha s b e e n r e t r o a c t i v e l y a p p li e d t o t h e c a lc ul a t i o n o f t h e t o t a l c a s h c o s t p e r o un c e o f g o ld s o ld f o r Y T D 20 12 Mi ne sit e co st p e r t on ne m il l ed M in e s it e c ost p e r ton n e mil l e d is a n o n G A A P p e r for ma n c e me a s ur e a n d ma y n o t b e c om pa r a b l e to in fo r ma tio n in oth e r gol d pr oduc e r s r e por ts a n d fil i n gs A s il l us tr a te d i n th e t a b l e b e l o w this me a s ur e is c a l c ul a te d b y a d jus tin g Pr oduc tio n C osts a s s how n i n the s ta te me n ts o f op e r a t ion s fo r in ve n to r y l e v e l c ha n g e s a n d the n divi din g b y to n n e s pr o c e s s e d thro ugh th e mil l Si n c e t ota l c a s h c ost pe r ou n c e o f gol d s ol d da t a c a n b e a ff e c te d b y fl uc tua tion s i n fo r e ign c u r r e n c y e xc ha n g e r a t e s M a n a ge m e n t b e l ie v e s tha t min e s ite c ost p e r t on n e mil l e d p r ovid e s a ddit i on a l in for ma tion r e ga r di n g the pe r fo r ma n c e o f min i n g o pe r a t ion s a n d a l l ow s M a n a g e m e n t to mo n ito r op e r a ti n g c osts on a mo r e c on s iste n t b a s is a s the pe r ton n e mil l e d m e a s ure e l i min a t e s the c ost va r ia b il ity a s s oc ia te d wi th va r ying pr oduc t ion l e ve l s M a n a ge m e n t a l s o us e s this m e a s ure to de t e r mi n e the e c o n omic via b il ity of min i n g b l oc k s A s e a c h mi n in g b l oc k is e va l ua te d b a s e d o n the n e t r e a l iza b l e va l u e of e a c h to n n e min e d th e e s ti ma te d r e ve n ue o n a p e r to n n e b a s is mus t b e i n e xc e s s o f th e m in e s ite c ost pe r t on n e mil l e d i n o r de r t o b e e c o n o mic a l l y via b l e M a n a ge me n t is a wa r e tha t this pe r t on n e mil l e d m e a s ur e is imp a c te d b y fl uc tua tio n s i n thro u ghput a n d thu s us e s this e va l ua tio n tool i n c on juncti on wi th pr oduc ti on c osts pr e pa r e d in a c c or da n c e wi th IF R S T his m e a s ure s up pl e m e n ts pr oduc ti on c ost in fo r ma tio n p r e pa r e d in a c c or da n c e wi th IF R S a n d a l l ow s in v e s tor s t o disti n guis h b e t w e e n c ha n g e s in p r oduc ti on c osts r e s ul tin g fr o m c ha n g e s i n p r oduc ti on ve r s us c ha n g e s i n o pe r a tin g pe r for ma n c e A m o u n t s in t h o u s a n d s o f C a n a d ia n d o l l a r s e x c e p t wh e r e in d ic a t e d Q 2 2 0 1 3 Q 1 2 0 1 3 Q 2 2 0 1 2 Y T D 2 0 1 3 Y T D 2 0 1 2 M i n e s i t e o p e r a t i n g c o s t s p e r Fi n a n c i a l R e p o r t s 1 9 9 9 6 1 8 4 1 1 1 7 8 3 1 3 8 4 0 7 3 5 2 8 2 P r o d u c t i o n r o y a l t i e s p e r Fi n a n c i a l R e p o r t s 3 0 1 2 3 3 7 0 3 0 4 6 6 3 8 2 5 9 6 8 A d j u s t m e n t s 1 9 9 T o t a l c a s h c o s t s 2 3 0 0 8 2 1 7 8 1 2 0 8 7 7 4 4 7 8 9 4 1 1 5 1 D i v i d e d b y g o l d o u n c e s s o l d 2 5 0 6 0 2 3 0 0 9 2 2 4 9 5 4 8 0 6 9 4 2 8 2 0 T o t a l c a s h c o s t p e r o u n c e o f g o l d s o l d C a n a d i a n d o l l a r s 918 947 928 932 961 A v e r a g e U S D C A D e x c h a n g e r a t e 1 0 2 1 0 1 1 0 1 1 0 2 1 0 1 T o t a l c a s h c o s t p e r o u n c e o f g o l d s o l d U S 897 939 919 917 956 Br e a k d o w n o f t o t a l c a s h c o s t p e r o u n c e o f g o l d s o l d U S H o l t M i n e M i n e c a s h c o s t s 636 619 671 628 671 R o y a l t y c o s t s 155 166 166 160 167 791 785 837 788 838 H o l l o w a y M i n e M i n e c a s h c o s t s 947 977 771 962 852 R o y a l t y c o s t s 143 209 205 175 207 1 0 9 0 1 1 8 6 976 1 1 3 7 1 0 5 9 H i s l o p M i n e M i n e c a s h c o s t s 987 1 1 3 9 1 0 2 0 1 0 5 2 1 0 9 5 R o y a l t y c o s t s 987 1 1 3 9 1 0 2 0 1 0 5 2 1 0 9 5 T o t a l M i n e c a s h c o s t s 780 794 785 786 819 R o y a l t y c o s t s 117 145 134 131 137 897 939 919 917 956