(All dollar figures are in US dollars unless otherwise indicated)
TORONTO, July 26, 2017 /CNW/ - New Gold Inc. ("New Gold") (TSX:NGD) (NYSE American:NGD) today announces its 2017 second quarter results and provides an update on the construction of the company's Rainy River project.

2017 Second Quarter Highlights

Gold production of 105,064 ounces increased by 6% relative to 2016 coupled with copper production of 26.4 million pounds
Operating expense of $627 per gold ounce and $1.26 per copper pound
All-in sustaining costs(1) of $737 per ounce, including total cash costs(2) of $360 per ounce, consistent with the prior-year quarter
Cash generated from operations of $80 million, or $0.14 per share
Cash generated from operations before changes in non-cash operating working capital(3) of $76 million
Net earnings of $23 million, or $0.04 per share
Adjusted net earnings(4) of $13 million, or $0.02 per share
Rainy River project schedule and capital cost estimate remain in line with New Gold's updated plan announced on January 30, 2017
Rainy River project capital expenditures totalled $160 million during the quarter
Entered into gold price option contracts covering 120,000 ounces of second half 2017 production (20,000 ounces per month) ensuring a guaranteed floor price of $1,250 per ounce while providing continued exposure to increases in the gold price up to $1,400 per ounce
Subsequent to the end of the quarter, the company initiated a process to divest the Peak Mines, located in New South Wales, Australia as the company continues to focus on its America's centric portfolio of operating mines and development projects
June 30, 2017 cash and cash equivalents of $199 million


"Our priorities continue to be: executing on our updated Rainy River plan, delivering operationally, and enhancing our financial flexibility," stated Hannes Portmann, President and Chief Executive Officer. "We are pleased to report that we made solid progress in all three areas during the second quarter."

"Our Rainy River project schedule and capital cost estimate remain in line with New Gold's updated plan announced on January 30, 2017, and the project is scheduled to transition from construction to operation in the third quarter of 2017," added Mr. Portmann. "Our operating mines continue to deliver which enabled us to generate $80 million in quarterly cash flow. At the same time, the redemption of our 2020 Senior Notes and extension of our revolving credit facility, further enhanced our financial flexibility."

Rainy River

Development activities at New Gold's Rainy River project, located in northwestern Ontario, continue to advance and the project is scheduled to transition from construction to operation in the third quarter of 2017. Both the project schedule and capital cost estimate remain in line with New Gold's updated plan announced on January 30, 2017.

Rainy River – 2017 Second Quarter Highlights

Project spending during the second quarter totalled $160 million, with estimated remaining capital to achieve November commercial production of $229 million
Mining rate during the quarter averaged approximately 115,000 tonnes per day despite impact of spring thaw
Mining rate averaged approximately 125,000 tonnes per day in the month of June
Public comment period for Schedule 2 amendment concluded on June 12th; timeline for expected amendment accelerated to fourth quarter of 2017
Commissioning of primary crusher and conveyor system complete, with first crush completed on May 11th as planned
Tailings management area corridor pipeline completed on June 15th, with first water moved to and from the water management pond on June 20th
Installation of mechanical, piping, electrical and instrumentation in processing facilities approximately 97% complete
Ball and SAG mill achieved mechanical completion and hand over to operations for commissioning
Energization of all key site power lines completed on schedule
Overall earthworks over 85% complete


Mining activities at Rainy River progressed well during the second quarter. The company's mining rate during the quarter averaged approximately 115,000 tonnes per day, which was in line with New Gold's updated plan announced on January 30, 2017. More importantly, the mining rate in June averaged approximately 125,000 tonnes per day and the company expects to build momentum through the remaining summer months.

Overall earthworks are over 85% complete and are tracking in line with New Gold's updated plan. Through June 30, 2017, over 1.1 million cubic metres of construction material has been placed at the tailings management starter cell. Starter cell rock deliveries are scheduled for completion in late August 2017. Energization of all key site overhead power lines, construction of the tailings pipeline corridor and construction of the tailings management area corridor pipeline have been completed.

All of the key structural components of the process facilities have been finalized and the setting of mechanical equipment and installation of piping, electrical and instrumentation services is close to completion. The primary crusher and conveyor system was successfully commissioned on schedule, and the first crush occurred on May 11, 2017. Commissioning of the ball mill and SAG mill has started and is scheduled to be completed in August 2017. Commissioning of the refining portion of the process circuit has commenced with dry and wet commissioning of the full circuit scheduled for August 2017.

The company requires an amendment to Schedule 2 of the Metal Mining Effluent Regulations to close two small creeks and deposit tailings. The proposed amendment was published in Canada Gazette I on May 13, 2017 and was followed by a 30-day public comment period which concluded on June 12, 2017. It is the company's understanding that the comments received during the comment period were in support of the project proceeding as proposed. In light of the positive comments, the company has revisited the proposed timeline with Environment and Climate Change Canada and expects that adoption of the Schedule 2 amendment will be accelerated to the fourth quarter of 2017.

As previously disclosed, New Gold is presently constructing a starter tailings cell, located within the broader tailings management area, that does not require a Schedule 2 amendment. This will allow New Gold to commence operations prior to completion of the Schedule 2 amendment. Based on its location and scale, the starter cell would provide capacity for approximately six months of production tailings when the mill is operating at full capacity.

In addition, New Gold has finalized the engineering design to construct the creek closures using sheet pile at the centre of the portion of the dam which will cover the creeks. The purpose of this approach is both to reduce the construction time after receipt of the Schedule 2 amendment, and most importantly, to be able to complete the work regardless of weather conditions. New Gold has met with the Ontario Ministry of Natural Resources and Forestry (MNRF) to review the design and has also filed its application for the required permit amendment in support of the design. It is expected that the Ontario MNRF will complete its review of the application during the third quarter of 2017.

Project spending at Rainy River during the second quarter totalled $160 million. The remaining capital cost to the targeted November commercial production is estimated to be approximately $229 million. Of the remaining expenditure, approximately 45% is related to mining and owner's costs, 45% is related to earthworks, including completion of the starter tailings cell, with the balance of the remaining expenditure related to the completion and commissioning of the process plant.

New Gold continues to look forward to the expected growth in the company's production and cash flow once Rainy River transitions into operation later this year. Rainy River has multiple important asset qualities including its great jurisdiction, significant annual production potential, long estimated reserve life and continued exploration potential.

2017 Second Quarter and Year-To-Date Operational Results

New Gold's second quarter gold production of 105,064 ounces was above 2016 as higher production from the company's Mesquite Mine more than offset planned lower production from New Afton, Peak Mines and Cerro San Pedro. Cerro San Pedro's production decreased as the mine transitioned into residual leaching in June 2016. Quarterly copper production increased to 26.4 million pounds when compared to the second quarter of 2016. Silver production of 0.3 million ounces was in line with 2016 as Cerro San Pedro continues residual leaching.

Second quarter operating expense per gold ounce of $627 increased relative to the prior-year quarter due to a higher proportion of sales from Mesquite. The company delivered second quarter all-in sustaining costs of $737 per ounce, including total cash costs of $360 per ounce. The slight increase in all-in sustaining costs relative to the prior-year quarter was attributable to a $26 per ounce increase in total cash costs to $360 per ounce, which was only partially offset by a $2 million, or $6 per ounce, decrease in the company's consolidated sustaining costs, which include New Gold's cumulative sustaining capital, exploration, general and administrative, and amortization of reclamation expenditures.

For the six-month period ended June 30, 2017, New Gold's gold production of 194,391 ounces was above 2016 as higher production from the company's Mesquite and Peak mines more than offset planned lower production from New Afton and Cerro San Pedro. Year-to-date copper production decreased to 50.3 million pounds when compared to 2016. Silver production of 0.6 million ounces was below 2016 as Cerro San Pedro transitioned to residual leaching after June 2016.

Year-to-date operating expense per gold ounce of $616 increased relative to the prior-year due to lower ounces sold and a higher proportion of sales coming from the Mesquite Mine. For the six-month period ended June 30, 2017, the company delivered all-in sustaining costs of $671 per ounce, including total cash costs of $330 per ounce. The decrease in all-in sustaining costs relative to the prior-year was attributable to a $13 per ounce decrease in the company's total cash costs and a $10 million, or $52 per ounce, decrease in consolidated sustaining costs.

As a result of the company's strong first half operational results, New Gold reiterates its guidance for full-year gold production of 380,000 to 430,000 ounces and operating expense per gold ounce sold of $630 to $670. The company expects approximately 40% of the second half 2017 gold production to occur in the third quarter, with the remaining 60% in the fourth quarter, benefitting from the start-up of Rainy River. Assuming current commodity prices and foreign exchange rates, New Gold is also pleased to reiterate its previously lowered guidance for all-in sustaining costs of $760 to $800 per ounce. As planned, all-in sustaining costs in the second half of 2017 are expected to be higher due to timing of sustaining capital expenditures and the higher operating costs attributable to the start-up of Rainy River.

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AND

ORONTO, July 26, 2017 /CNW/ - New Gold Inc. ("New Gold") (TSX:NGD) (NYSE American:NGD) today announces new appointments to its senior management team as the company looks forward to the Rainy River project's scheduled transition from construction into operation beginning in September. New Gold is also pleased to announce the addition of a new director to its Board.

Highlights

Paula Myson will join New Gold as Executive Vice President and Chief Financial Officer
Peter Woodhouse will join New Gold as Vice President, Projects
Barry O'Shea has been appointed Vice President, Business Development
Marilyn Schonberner has been appointed to the Board of Directors
Brian Penny, New Gold's current Executive Vice President and Chief Financial Officer, will remain with the company until the end of October to support the transition
Raymond Threlkeld's interim management role will conclude on September 1st and he will remain on New Gold's Board of Directors


As Hannes Portmann, New Gold's President and Chief Executive Officer, builds out the company's leadership team, and with Rainy River scheduled to transition into operation beginning in September, Paula Myson will join New Gold in late August to lead the company's financial team as Executive Vice President and Chief Financial Officer and Peter Woodhouse will join New Gold in mid-August as the Vice President, Projects.

Ms. Myson has over 25 years of experience in finance, treasury, corporate development, investor relations and risk management in public companies. During her 23 years working with the Sherritt International group of companies, Ms. Myson held multiple senior roles, including: CFO Oil and Gas, Corporate Treasurer, CFO Power, and Director, Corporate Development. Most recently, she was Vice President, Finance at Callidus Capital Corporation, a specialty lender.

Mr. Woodhouse has over 30 years of experience in engineering and project management, dedicated primarily to the development of mining infrastructure. Over his career, he has been responsible for all aspects of project management, team development and project execution, through all project phases, from scoping study through commissioning. Most recently, he was Vice President, Projects at Centerra Gold where he was responsible for overall capital projects development. From 1997 to 2014, Mr. Woodhouse was the principal of Technology Management Group Inc., an engineering and project management company. Mr. Woodhouse has also held senior project management roles for Canada Lithium, Hatch, SNC Lavalin, and Xstrata Nickel.

"We are delighted to welcome Paula and Peter to our team. Paula's extensive experience in mining and her strong financial and executional skillset will both complement and enhance the capabilities of New Gold's leadership team," stated Mr. Portmann. "In addition, Peter's engineering and project management experience will be a great asset for the company as he leads the advancement of our various organic growth initiatives, including the Blackwater project and the C-zone at New Afton."

In connection with these management changes, Barry O'Shea, the Vice President, Finance of the company, has been appointed Vice President, Business Development. In his new role, Mr. O'Shea will take on responsibility for corporate development, investor relations and strategic capital allocation, and he will also support Ms. Myson's transition into the Chief Financial Officer role.

New Gold is also pleased to announce the appointment of Marilyn Schonberner to its Board of Directors. Marilyn is the Chief Financial Officer and Senior Vice President, and an Executive Director, of Nexen Energy ULC. In that role, she is responsible for the overall financial management of Nexen, including accounting, audit, tax, planning, treasury and insurance. Ms. Schonberner joined Nexen in 1997 and since that time has held positions of increasing responsibility including General Manager of Human Resources Services, Director of Corporate Audit, Director of Business Services U.K., and Treasurer and Vice President of Corporate Planning. Prior to joining Nexen, she spent over 15 years in finance, strategic planning and organization development in the energy sector and as a consultant.

"We are pleased to welcome Marilyn to the Board," stated Ian Pearce, Chair of the Board. "She is highly qualified, with a strong background in finance, accounting, tax and treasury. We believe that Marilyn will add considerable value and strength to our Board."

Brian Penny, New Gold's current Executive Vice President and Chief Financial Officer, will remain with New Gold until October 31, in order to support a smooth transition of responsibilities to Ms. Myson. Mr. Penny has been the Chief Financial Officer of New Gold since its business combination with Western Goldfields in 2009. In that time, he has played a leadership role in numerous successful transactions, including the company's sale of the El Morro stream, successful equity offering and bond refinancing, and credit facility extension earlier this year, which have positioned the company well to fund the remaining capital expenditures at the Rainy River project.

With the addition of Mr. Woodhouse in mid-August and the planned start-up of Rainy River in September, Raymond Threlkeld will step away from his interim daily management responsibilities, which primarily focused on supporting Rainy River's development, effective September 1, 2017. Mr. Threlkeld will remain on the Board and continue to provide his support and knowledge to the operations and projects teams going forward.

"I would like to thank Brian for all that he has done to contribute to New Gold's success over the last eight years. He has been a wonderful business partner and friend over many years and we wish him nothing but success in his future endeavours," stated Mr. Portmann. "On behalf of our team, I would also like to thank Ray for stepping into the Interim Chief Operating Officer role at a critical time in the development of Rainy River."

About New Gold Inc.

New Gold is an intermediate gold mining company. The company has a portfolio of four producing assets and two significant development projects. The New Afton Mine in Canada, the Mesquite Mine in the United States, the Peak Mines in Australia and the Cerro San Pedro Mine in Mexico (which transitioned to residual leaching in 2016), provide the company with its current production base. In addition, New Gold owns 100% of the Rainy River and Blackwater projects located in Canada. New Gold's objective is to be the leading intermediate gold producer, focused on the environment and social responsibility. For further information on the company, please visit www.newgold.com