Golden Star Resources Reports Third Quarter and Nine Month

Golden Star Resources Reports Third Quarter and Nine Month Financial
Results 
DENVER, CO -- (Marketwire) -- 11/07/12 --  Golden Star Resources Ltd.
(NYSE MKT: GSS) (TSX: GSC) (GHANA: GSR) 
Third quarter gold sales up 9% to 80,826 ounces from 73,861 ounces in
Q3 last year 
Year-to-date gold sales up 6% to 243,734 ounces from 230,309 ounces
in 2011 
Revenue up 6% in Q3 to $133.5 million and up 14% year-to-date to
$400.8 million vs. 2011 
Third quarter operating cash flow before changes in working
capital(2) of $29.8 million ($0.12 per share) vs. $7.2 million ($0.03
per share) in 2011 
Nine-month operating cash flow before changes in working capital of
$83.9 million ($0.32 per share) vs. $24.7 million ($0.10 per share)
in 2011 
Third quarter cash flow from operations of $24.3 million ($0.09 per
share) vs. $11.5 million ($0.04 per share) in Q3 2011 - five straight
quarters of positive cash flow 
Nine-month cash flow from operations of $59.8 million ($0.23 per
share) vs. $4.2 million ($0.02 per share) in 2011 
Cash operating costs per ounce continue to improve on year-over-year
basis 
Golden Star Resources Ltd. (NYSE MKT: GSS) (TSX: GSC) (GHANA: GSR)
("Golden Star" or the "Company") today reported unaudited financial
results prepared in accordance with US GAAP for the third quarter and
nine-month period ended September 30, 2012. 
Third Quarter Highlights
 The Company produced and poured 83,287
ounces of gold in the third quarter of 2012, of which 80,826 ounces
were sold, yielding a 9% increase over 73,861 ounces sold in the same
quarter last year. Cash operating costs per ounce in the third
quarter improved to $992, a 10% reduction from $1,108 in the third
quarter last year. The higher gold production led to a 6% increase in
revenue in the third quarter of 2012 to $133.5 million from $125.9
million in the same quarter a year ago. The net loss attributable to
Golden Star shareholders was $30.2 million, or $0.12 per share,
versus a net loss of $10.2 million, or $0.04 per share, in the third
quarter of 2011. Adjusted net loss (refer to footnote 1) for the
third quarter was $0.1 million, or $0.00 per share, compared with
adjusted net income of $3.0 million, or $0.01 per share, for the
third quarter of 2011.  
Golden Star generated $24.3 
million, or $0.09 per share, in cash from
operations in the third quarter, up from $11.5 million, or $0.04 per
share, in the same quarter last year. It was the Company's fifth
consecutive quarter of positive cash flow. Operating cash flow before
changes in working capital (refer to footnote 2) in the third quarter
was $29.8 million, or $0.12 per share, up from $7.2 million, or $0.03
per share, in the third quarter a year ago. 
Nine-Month Highlights
 For the first nine months of 2012, Golden Star
produced and poured 246,195 ounces of gold, of which 243,734 ounces
were sold, representing a 6% increase over 230,309 ounces sold in the
third quarter a year ago. Year-to-date cash operating costs per ounce
improved to $1,007 versus $1,054 in the same period last year. Higher
gold production and an 8% increase in average realized gold price
resulted in 2012 year-to-date revenue of $400.8 million, up 14% from
$352.2 million in the same period a year ago. Year-to-date net loss
attributable to Golden Star shareholders was $18.6 million, or $0.07
per share, versus a net loss of $9.3 million, or $0.04 per share,
through the first nine months of 2011. Adjusted net loss for the nine
month period of 2012 was $8.1 million or $0.03 per share compared
with an adjusted net loss of $13.7 million, or $0.05 per share, in
the first nine months of 2011. 
Cash flow from operations through the first nine months of 2012
increased to $59.8 million, or $0.23 per share, up from $4.2 million,
or $0.02 per share, in the same period last year. Operating cash flow
before changes in working capital was $83.9 million, or $0.32 per
share, for the first nine months of 2012, up from $24.7 million, or
$0.10 per share, for the same period in 2011. 
"Golden Star delivered solid improvements in year-over-year results
in the third quarter and nine month period, with increased gold
production, higher revenue and our fifth consecutive quarter of
positive cash flow," said Tom Mair, President and CEO. "We are
particularly pleased with increased throughput and improved
reliability at the Bogoso sulfide plant. Likewise, we're encouraged
by the continued strong performance at Wassa, where grade has
steadily improved, recovery remains solid at better than 94%, and
we've achieved meaningful reductions in per ounce cash operating
costs over the past two quarters. We're also excited about the
development progress at the Prestea underground mine and the
continued positive drilling results beneath the Wassa Main pits, and
are optimistic that Wassa may develop into a much larger operation
over time." 


 
                                                                            
SUMMARY OF CONSOLIDATED FINANCIAL                                           
 RESULTS                             Three months ended   Nine months ended 
(Unaudited)                             September 30,       September 30,   
                                       2012      2011      2012      2011   
                                     --------  --------  --------  -------- 
                                                                            
Bogoso/Prestea gold sold (oz)          39,844    40,376   125,201   105,029 
Wassa/HBB gold sold (oz)               40,982    33,485   118,533   125,280 
Total gold sold (oz)                   80,826    73,861   243,734   230,309 
                                                                            
Average realized gold price ($/oz)      1,653     1,704     1,645     1,529 
Cash operating cost - combined                                              
 ($/oz)                                   992     1,108     1,007     1,054 
Gold revenues ($000s)                 133,497   125,880   400,830   352,193 
Cash flow provided by operations                                            
 ($000s)                               24,312    11,467    59,766     4,152 
Net loss attributable to                                                    
 shareholders ($000s)                 (30,207)  (10,196)  (18,610)   (9,316)
Net loss attributable to                                                    
 shareholders ($/share)                 (0.12)    (0.04)    (0.07)    (0.04)

 
Footnotes: 
(1) Adjusted net income/loss: defined as Net Income/Loss adjusted for
the impact of derivative mark to market gains/losses, gain/loss on
fair value of convertible debentures, gain/loss on sale of
investments and gain/loss on extinguishment of debt. 
(2) Operating cash flow before changes in working capital: defined as
net cash provided by operating activities less changes in working
capital. Changes in working capital include changes in accounts
receivable, inventories, deposits, accounts payable and accrued
liabilities. 
BOGOSO/PRESTEA RECAP
 Bogoso/Prestea consolidated gold sales in the
third quarter totaled 39,844 ounces, down marginally from 40,376
ounces in the same quarter last year. Gold sales from the Bogoso
sulfide plant totaled 30,277 ounces in the third quarter, down from
40,376 ounces in the same quarter a year ago due to lower ore grades
and lower gold recoveries. That decline was partially offset by
non-refractory gold sales of 9,567 ounces fro
m the oxide plant, which
restarted processing operations in the first quarter of 2012. Cash
operating costs for Bogoso/Prestea were $1,171 per ounce in the third
quarter, down 5% from $1,238 per ounce in the same quarter last year
but up 17% over the second quarter of 2012 due to lower grade of mill
feed.  
The Company continued to make progress at the sulfide mill, which
achieved the highest ore throughput in six quarters. The mill head
grade was lower as the Company processed significant volumes of lower
grade stockpile material, which, in turn, impacted recovery. Over the
past year, reflecting the inflationary cost environment across the
mining industry, Bogoso/Prestea unit mining costs increased
approximately 15%. Due to improved cost controls, unit processing
costs at the sulfide plant declined approximately 20%, partially
offsetting the higher mining costs. 
Operations at the oxide mill were affected by lower than expected
grades and recoveries. Throughput was impacted by mechanical
reliability and tails pumping issues. The Company made progress
during the third quarter and expects improved throughput going
forward. 
In response to higher gold prices and new ore zones, current mining
plans anticipate substantial pit wall pushbacks at both the Bogoso
North and Chujah pits over the next two years which are expected to
result in temporarily high stripping ratios. This work will prepare
the pits for lower stripping ratios and improved cashflows in 2015
and beyond. We are currently in the planning cycle and alternatives
which have the potential to improve the mine plans are being
evaluated. 


 
                                                                            
Bogoso/Prestea Key Metrics            3Q-12   2Q-12   1Q-12   4Q-11   3Q-11 
                                     ------- ------- ------- ------- -------
                                                                            
Refractory ore mined (000st)             593     605     770     711     594
Non-refractory ore mined (000st)         174     245     141      16      84
Total ore mined (000st)                  767     849     910     727     678
Waste mined (000st)                    5,492   5,014   7,242   8,876   6,884
                                                                            
Refractory ore processed (000st)         687     570     611     493     579
Refractory grade (g/t)                  2.05    2.60    2.55    2.95    2.63
Refractory ore recovery (%)             69.6    71.3    73.3    77.7    75.9
Gold sold (oz) refractory             30,277  34,051  34,338  35,475  40,376
                                                                            
Non-refractory ore processed (000st)     231     202     173      --      --
Non-refractory grade (g/t)              2.04    2.71    2.66      --      --
Non-refractory ore recovery (%)         71.8    62.2    54.1      --      --
Gold sold (oz) non-refractory          9,567  10,064   6,904      --      --
                                                                            
Total gold sold (oz)                  39,844  44,115  41,242  35,475  40,376
Cash operating cost ($/oz)             1,171     999   1,222   1,166   1,238

 
WASSA/HBB RECAP
 Wassa/HBB gold sales in the third quarter increased
22% to 40,982 ounces from 33,485 ounces in the same quarter last
year. This increase was attributed to significantly higher grade
processed -- 2.31 grams per tonne (g/t) -- in the third quarter as
compared with 1.82 g/t in the same quarter a year ago. The improved
grade resulted from increased processing of ore from the higher-grade
Father Brown pit. 
The increase in ounces sold from the Wassa operation, combined with
improved cost controls, resulted in a 14% improvement in cash
operating costs in the third quarter of 2012 to $817 per ounce from
$950 per ounce in the same quarter last year and a 3% improvement
from $838 per ounce in the second quarter of 2012. It was the third
consecutive quarter that cash operating costs at Wassa/HBB have
declined. Despite the input cost increases the industry is
experiencing, Wassa's unit mining costs declined approximately 20%
over the past year while unit processing costs have remained stable.  


 
                                                                            
Wassa/HBB Key Metrics                 3Q-12   2Q-12   1Q-12   4Q-11   3Q-11 
                                     ------- ------- ------- ------- -------
                                                                            
Ore mined (000st)                        660     715     683     639     623
Waste mined (000st)                    4,043   3,818   4,445   3,820   3,927
Ore processed (000st)                    602     641     682     589     601
Grade (g/t)                             2.31    2.06    1.74    2.04    1.82
Recovery (%)                            94.7    94.8    93.9    94.1    93.7
Cash operating cost ($/oz)               817     838     999   1,012     950
Gold sold (oz)                        40,982  41,068  36,483  35,336  33,485

 
EXPLORATION 
During the third quarter Golden Star raised the rig count from two to
five in order to accelerate exploration beneath the Wassa Main pits
following increasingly positive drilling results in the first half of
2012. The Company completed an additional 49 drill holes in the third
quarter totaling 16,485 meters comprising approximately 67% HQ sized
diamond drill core and 33% RC (reverse circulation). The results of
this latest drilling continued to support the Company's position that
mineralization at depth is wider and higher grade than what has been
mined to date and that a major expansion of the Wassa pits may lead
to significant, long-term production increases from this asset. The
Company intends to update its block models and pit optimizations for
year-end resource determination. Drilling will continue in 2013 in
conjunction with a feasibility study on a potential Wassa
expansion. 
DEVELOPMENT
 A major development project for Golden Star
is the West Reef area of the Prestea Underground mine. The West Reef
resource totals 874,000 tonnes grading 18.07 g/t for 508,000 ounces
of gold in the Indicated category plus an Inferred Mineral Resource
of 510,000 tonnes grading 11.58 g/t for 190,000 ounces. As reported
in the March 21, 2012, Preliminary Economic Assessment (PEA), in
early August 2012 the Company commissioned a new underground drilling
rig, which has since been operating on 17 level of the West Reef.
Results from the drilling program will be incorporated into the
information being gathered for the West Reef feasibility study, which
is expected to be completed in early 2013. 
LIQUIDITY AND CAPITAL RESOURCES
 At September 30, 2012, Golden Star
had $106.3 million in cash and cash equivalents, up slightly from
$105.7 million at the end of the second quarter of 2012 and up from
$103.6 million at 2011 year-end. The Company has an additional $19.8
million in borrowing capacity available under its equipment financing
credit facility. 
During the third quarter Golden Star redeemed $6.1 million of its
4.00% Convertible Senior Unsecured Debentures due November 30, 2012,
leavi
ng $44.4 million outstanding principal. The Company will pay the
outstanding principal plus accrued interest in cash. 
Golden Star invested approximately $19.1 million in capital projects
in the third quarter, including $11.1 million for development
projects and $8.0 million for the acquisition of new equipment and
facilities at its mine sites. The Company expects to invest
approximately $30 to $35 million in capital projects in the fourth
quarter of 2012, including Bogoso and Wassa plant upgrades,
development drilling and a new tailings facility at Wassa,
construction of a water treatment plant, and ongoing development and
drilling at the Prestea underground mine. 
In 2013 the Company expects to invest $100 to $125 million. Major
projects include the development of the Dumasi pit, Bogoso plant
upgrades, Phase 1 of the Prestea underground mine development, Wassa
drilling programs, the new Wassa tailings facility and sustaining
capital requirements. At current gold prices, the Company expects
that current cash on hand, operating cashflow and borrowing under the
equipment financing facility will be sufficient to meet these capital
requirements. 


 
2012 GUIDANCE                                                               
                        Bogoso/Prestea          Wassa/HBB           Combined
                    ------------------ ------------------ ------------------
Oz produced         175,000 to 178,000 158,000 to 160,000 333,000 to 338,000
Cash operating cost                                                         
 ($/oz)                 1,100 to 1,180         950 to 985     1,040 to 1,100

 
Notes: 
 1. Power and fuel prices used in the guidance are $0.16 per
kilowatt-hour and $1.33 per liter, respectively. 
 2. Starting in
late 2012, and continuing through 2014, water treatment costs are
estimated to add approximately $60 per ounce at Bogoso, but should
drop significantly thereafter when the current backlog of process
water is treated. 
Third Quarter Conference Call
 The Company will conduct a conference
call and webcast at 11:00 a.m. Eastern Time on November 8, 2012.
Please call in at least five minutes prior to the conference call
start time to ensure prompt access to the conference. The call can be
accessed by telephone or by webcast as follows: 
North American participants: (877) 407-8289
 Participants outside
U.S. and Canada: (201) 689-8341
 Webcast: www.gsr.com  
A recording of the conference call will be available until November
29, 2012, through the Company's website at www.gsr.com or by dialing: 
North America: (877) 660-6853, Conference ID number: 401439 
International outside U.S. and Canada: (201) 612-7415, Conference ID
number: 401439 


 
                                                                            
                         GOLDEN STAR RESOURCES LTD.                         
                        CONSOLIDATED BALANCE SHEETS                         
 (Stated in thousands of U.S. dollars except shares issued and outstanding) 
                                (unaudited)                                 
                                                                            
                                                   As of          As of     
                                               September 30,   December 31, 
                                                    2012           2011     
                                               -------------  ------------- 
ASSETS                                                                      
CURRENT ASSETS                                                              
  Cash and cash equivalents                    $     106,322  $     103,644 
  Accounts receivable                                  8,113         10,077 
  Inventories                                         91,876         74,297 
  Deposits                                             8,505          6,474 
  Available for sale investments                      17,817          1,416 
  Prepaids and other                                   2,173          2,048 
                                               -------------  ------------- 
    Total Current Assets                             234,806        197,956 
RESTRICTED CASH                                        2,028          1,273 
PROPERTY, PLANT AND EQUIPMENT                        256,338        252,131 
INTANGIBLE ASSETS                                      3,685          5,266 
MINING PROPERTIES                                    252,496        270,157 
OTHER ASSETS                                              --            895 
                                               -------------  ------------- 
    Total Assets                               $     749,353  $     727,678 
                                               =============  ============= 
LIABILITIES                                                                 
CURRENT LIABILITIES                                                         
  Accounts payable                             $      28,829  $      40,708 
  Accrued liabilities                                 53,981         51,380 
  Asset retirement obligations                         7,886          8,996 
  Current tax liability                                   --            197 
  Current debt                                        51,270        128,459 
                                               -------------  ------------- 
    Total Current Liabilities                        141,966        229,740 
LONG TERM DEBT                                       116,642         10,759 
ASSET RETIREMENT OBLIGATIONS                          22,716         24,884 
DEFERRED TAX LIABILITY                                43,457         23,993 
                                               -------------  ------------- 
    Total Liabilities                          $     324,781  $     289,376 
                                               -------------  ------------- 
COMMITMENTS AND CONTINGENCIES                             --             -- 
SHAREHOLDERS' EQUITY                                                        
SHARE CAPITAL                                                               
  First preferred shares, without par value,                                
   unlimited shares authorized. No shares                                   
   issued and outstanding                                 --             -- 
  Common shares, without par value, unlimited                               
   shares authorized. Shares issued and                                     
   outstanding: 258,950,971 at September 30,                                
   2012; 258,669,487 at December 31, 2011      $     694,480  $     693,899 
CONTRIBUTED SURPLUS                                   23,903         19,815 
ACCUMULATED OTHER COMPREHENSIVE INCOME                 1,707          1,978 
DEFICIT                                             (294,722)      (276,112)
                                               -------------  ------------- 
    Total Golden Star Equity                         425,368        439,580 
NONCONTROLLING INTEREST                                 (796)        (1,278)
                                               -------------  ------------- 
    Total Equity                                     424,572        438,302 
                                               -------------  ------------- 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY     $     749,353  $     727,678 
                                               =============  ============= 
                                                                            
                                                                            
                         GOLDEN STAR RESOURCES LTD.                         
                   CONSOLIDATED STATEMENTS OF OPERATIONS                    
   (Stated in thousands of U.S. dollars except shares and per share data)   
                                
(unaudited)                                 
                                                                            
                                 For the three months   For the nine months 
                                         ended                 ended        
                                     September 30,         September 30,    
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
REVENUE                                                                     
Gold revenues                    $ 133,497  $ 125,880  $ 400,830  $ 352,193 
Cost of sales                      120,899    106,385    354,914    316,661 
                                 ---------  ---------  ---------  --------- 
  Mine operating margin             12,598     19,495     45,916     35,532 
Exploration expense                    583      1,824      2,674      3,972 
General and administrative                                                  
 expense                             4,606      5,996     16,091     20,350 
Derivative mark-to-market loss          --     11,161        162     17,840 
Loss/(gain) on fair value of                                                
 convertible debentures             30,055      2,084     32,092    (22,208)
Property holding costs               1,617      1,778      5,027      6,141 
Foreign exchange loss                  282        666      2,162      1,385 
Interest expense                     2,067      2,193      8,563      6,663 
Interest and other income              (89)       (61)      (357)      (163)
Gain on sale of assets                 (52)      (338)      (113)      (336)
Loss/(gain) on sale of                                                      
 investments                            70         --    (22,290)        -- 
(Gain)/loss on extinguishment of                                            
 debt                                  (14)        --        568         -- 
                                 ---------  ---------  ---------  --------- 
    (Loss)/income before income                                             
     tax                           (26,527)    (5,808)     1,337      1,888 
Income tax expense                  (4,002)    (3,621)   (19,464)   (11,727)
                                 ---------  ---------  ---------  --------- 
    Net loss                     $ (30,529) $  (9,429) $ (18,127) $  (9,839)
Net income/(loss) attributable                                              
 to noncontrolling interest            322       (767)      (483)       523 
                                 ---------  ---------  ---------  --------- 
    Net loss attributable to                                                
     Golden Star shareholders    $ (30,207) $ (10,196) $ (18,610) $  (9,316)
                                 =========  =========  =========  ========= 
                                                                            
Net loss per share attributable                                             
 to Golden Star shareholders                                                
Basic                            $   (0.12) $   (0.04) $   (0.07) $   (0.04)
Diluted                          $   (0.12) $   (0.04) $   (0.07) $   (0.04)
Weighted average shares                                                     
 outstanding (millions)              258.9      258.6      258.8      258.6 
Weighted average shares                                                     
 outstanding-diluted (millions)      258.9      258.6      258.8      258.6 
                                                                            
                                                                            
                                                                            
                         GOLDEN STAR RESOURCES LTD.                         
                   CONSOLIDATED STATEMENTS OF CASH FLOWS                    
   (Stated in thousands of U.S. dollars except shares and per share data)   
                                 (unaudited)                                
                                                                            
                                 For the three months   For the nine months 
                                         ended                 ended        
                                     September 30,         September 30,    
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
OPERATING ACTIVITIES:                                                       
Net loss                         $ (30,529) $  (9,429) $ (18,127) $  (9,839)
Reconciliation of net loss to                                               
 net cash provided by operating                                             
 activities:                                                                
  Depreciation, depletion and                                               
   amortization                     25,541     15,621     69,765     52,113 
  Amortization of loan                                                      
   acquisition costs                    --        321        895        993 
  Loss/(gain) on sale of                                                    
   investments                          70         --    (22,290)        -- 
  (Gain)/loss on extinguishment                                             
   of debt                             (14)        --        568         -- 
  Gain on sale of assets               (52)      (338)      (113)      (336)
  Non-cash employee compensation     1,033        564      4,737      2,784 
  Deferred income tax expense        4,002      2,908     19,464      9,255 
  Fair value of derivatives loss        --      1,700        162      6,879 
  Fair value loss/(gain) on                                                 
   convertible debt                 30,055      2,084     32,092    (22,208)
  Accretion of asset retirement                                             
   obligations                         703      2,184      2,111      5,300 
  Reclamation expenditures            (967)    (8,416)    (5,389)   (20,244)
  Changes in working capital        (5,530)     4,268    (24,109)   (20,545)
                                 ---------  ---------  ---------  --------- 
    Net cash provided by                                                    
     operating activities           24,312     11,467     59,766      4,152 
INVESTING ACTIVITIES:                                                       
  Expenditures on mining                                                    
   properties                      (11,079)   (12,211)   (30,942)   (30,242)
  Expenditures on property,                                                 
   plant and equipment              (7,996)   (13,678)   (27,616)   (33,541)
  Change in accounts payable and                                            
   deposits on mine equipment                                               
   and material                      2,544      2,499       (145)      (685)
  Increase in restricted cash         (755)        --       (755)        -- 
  Cash used for equity                                                      
   investments                          --     (1,200)      (938)    (1,200)
  Proceeds from sale of assets         399        681      7,084        681 
                                 ---------  ---------  ---------  --------- 
    Net cash used in investing                                              
     activities                    (16,887)   (23,909)   (53,312)   (64,987)
FINANCING ACTIVITIES:                                                       
  Principal payments on debt      
  (8,055)    (2,622)   (12,476)    (7,960)
  Proceeds from debt agreements                                             
   and equipment financing           1,124      1,391      8,510      4,861 
  Exercise of options                   99         52        190        210 
                                 ---------  ---------  ---------  --------- 
    Net cash used in financing                                              
     activities                     (6,832)    (1,179)    (3,776)    (2,889)
                                 ---------  ---------  ---------  --------- 
Increase/(decrease) in cash and                                             
 cash equivalents                      593    (13,621)     2,678    (63,724)
Cash and cash equivalents,                                                  
 beginning of period               105,729    127,915    103,644    178,018 
                                 ---------  ---------  ---------  --------- 
Cash and cash equivalents, end                                              
 of period                       $ 106,322  $ 114,294  $ 106,322  $ 114,294 
                                 =========  =========  =========  ========= 

 
COMPANY PROFILE
 Golden Star Resources holds the largest land package
in one of the world's largest and most prolific gold producing
regions. The Company holds a 90% equity interest in Golden Star
(Bogoso/Prestea) Limited and Golden Star (Wassa) Limited, which
respectively own the Bogoso/Prestea and Wassa/HBB open-pit gold mines
in Ghana, West Africa. In addition, Golden Star has an 81% interest
in the currently inactive Prestea Underground mine in Ghana, as well
as gold exploration interests elsewhere in Ghana, in other parts of
West Africa and in Brazil in South America. Golden Star has
approximately 259 million shares outstanding. Additional information
is available at www.gsr.com.  
Statements Regarding Forward-Looking Information: Some statements
contained in this news release are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
and other applicable securities laws. Investors are cautioned that
forward-looking statements are inherently uncertain and involve risks
and uncertainties that could cause actual results to differ
materially. Such statements include comments regarding improvements
to throughput at the Bogoso sulfide plant; our expectations regarding
potential expansion at Wassa; the timing of an update to block models
and pit optimizations and for updated resource estimates; our plans
to advance the Wassa expansion feasibility study; planned investments
in capital projects; plans to incorporate drilling results into the
West Reef Prestea Underground feasibility study; the timing of
completion of the feasibility study for Prestea Underground; plans to
repay the outstanding principal of the remaining Original Debentures;
and the Company's 2012 production and cash operating cost estimates,
including anticipated power and fuel prices and water treatment
costs. Factors that could cause actual results to differ materially
include timing of and unexpected events at the Bogoso/Prestea
non-refractory and sulfide processing plants and at the Wassa
processing plant; variations in ore grade, tonnes mined, crushed or
milled; variations in relative amounts of refractory, non-refractory
and transition ores; delay or failure to receive board or government
approvals and permits; the availability and cost of electrical power
and fuel; timing and availability of external financing on acceptable
terms; technical, permitting, mining or processing issues; changes in
U.S. and Canadian securities markets; and fluctuations in gold price
and costs and general economic conditions. There can be no assurance
that future developments affecting the Company will be those
anticipated by management. Please refer to the discussion of these
and other factors in our Form 10-K for 2011. The forecasts contained
in this press release constitute management's current estimates, as
of the date of this press release, with respect to the matters
covered thereby. We expect that these estimates will change as new
information is received and that actual results will vary from these
estimates, possibly by material amounts. While we may elect to update
these estimates at any time, we do not undertake to update any
estimate at any particular time or in response to any particular
event. Investors and others should not assume that any forecasts in
this press release represent management's estimate as of any date
other than the date of this press release. 
Non-GAAP Financial Measures: In this news release, we use the terms
"total cash cost per ounce", "cash operating cost per ounce". These
are non-GAAP performance measures as defined in SEC Regulation S-K
Item 10 and in applicable Canadian securities laws and should not be
considered in isolation or as a substitute for performance measures
prepared in accordance with GAAP. The Company believes these non-GAAP
measures complement conventional measures prepared in accordance with
GAAP to enable the Company and investors to evaluate the financial
and operating performance of the Company. Changes in numerous factors
including, but not limited to, mining rates, milling rates, gold
grade, gold recovery, and the costs of labor, consumables and mine
site general and administrative activities can cause these measures
to increase or decrease. We believe that these measures are the same
or similar to the measures of other gold mining companies, but may
not be comparable to similarly titled measures in every instance. 
The GAAP measure, "Cost of sales", as found in our statements of
operations, includes all mine-site operating costs, including the
costs of mining, ore processing, maintenance, work-in-process
inventory changes, mine-site overhead as well as production taxes,
royalties, mine site depreciation, depletion, amortization, asset
retirement obligation accretion and by-product credits, but excludes
exploration costs, property holding costs, corporate office general
and administrative expenses, foreign currency gains and losses,
impairment charges, corporate business development costs, gains and
losses on asset sales, interest expense, gains and losses on
derivatives, gains and losses on investments and income tax
expense/benefit.  
"Cash operating cost per ounce" for a period is equal to "Cost of
sales" for the period less mining related depreciation, depletion and
amortization costs, royalties, production taxes, accretion of asset
retirement obligation costs, costs that meet the definition of
Betterment Stripping under International Financial Reporting
Standards ("IFRS") and operations-related foreign currency gains and
losses for the period, divided by the number of ounces of gold sold
during the period. "Total cash cost per ounce" for a period is equal
to "Cash operating costs" for the period plus royalties and
production taxes, divided by the number of ounces of gold sold during
the period.  
We use cash operating cost per ounce and total cash cost per ounce as
key operating indicators. We monitor these measures monthly,
comparing each month's values to prior periods' values to detect
trends that may indicate increases or decreases in operating
efficiencies. These measures are also compared against budget to
alert management of trends that may cause actual results to deviate
from planned operational results. Since these measures do not
incorporate revenues, changes in working capital and non-operating
cash costs, they are not necessarily indicative of operating profit
or cash flow from operations as determined under GAAP. 
Cautionary Note to Investors Concerning Estimates of "Indicated
Mineral Resources" and "Inferred Mineral Resources"
 This release
uses the terms "Indicated Mineral Resources" and "Inferred Mineral
Resources". The Company advises US investors that while these terms
are recognized and required by National Instrument 43-101, the US
Securities and Exchan
ge Commission ("SEC") does not recognize them.
US Investors are cautioned not to assume that any part or all of the
mineral deposits in these categories will ever be converted into a
higher category or into mineral reserves. Inferred Mineral Resources
have a great amount of uncertainty as to their existence, and great
uncertainty as to their economic and legal feasibility. US investors
are cautioned not to assume that any part or all of the Inferred
Mineral Resource exists, or is economically or legally mineable.
Also, disclosure of contained ounces is permitted under Canadian
regulations; however the SEC generally requires mineral resource
information to be reported as in-place tonnage and grade. The
Preliminary Economic Assessment for the West Reef area of the Prestea
Underground (the "PEA") is preliminary in nature, it includes
Inferred Mineral Resources that are considered too speculative
geologically to have economic considerations applied to them that
would enable them to be categorized as mineral reserves, there is no
assurance that the PEA will be realized and mineral resources that
are not mineral reserves do not have demonstrated economic viability. 
The technical contents of this press release that relate to the PEA
have been reviewed and approved by Dr. Martin Raffield, P.Eng., a
Qualified Person pursuant to National Instrument 43-101. Dr. Raffield
is Senior Vice President Technical Services for Golden Star. Please
refer to the Company's press release dated March 21, 2012, titled
"Golden Star Resources Announces Positive Preliminary Economic
Assessment for Prestea Underground Mine" for additional information
regarding the PEA. 
For further information, please contact: 
GOLDEN STAR RESOURCES LTD.
Bruce Higson-Smith
Senior Vice President Finance and Corporate Development
1-800-553-8436 
INVESTOR RELATIONS
Jay Pfeiffer
Pfeiffer High Investor Relations, Inc. 
303-393-7044 
 
 
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