(All dollar amounts are United States dollars unless otherwise stated)

VANCOUVER, BC, Aug. 2, 2023 /PRNewswire/ - Galiano Gold Inc. ("Galiano" or the "Company") (TSX: GAU) (NYSE American: GAU) is pleased to report its second quarter ("Q2") operating and financial results for the Company and the Asanko Gold Mine ("AGM"), located in Ghana, West Africa. The AGM is a 50:50 joint venture ("JV") with Gold Fields Limited ("Gold Fields") which is managed and operated by Galiano. All financial information contained in this news release is unaudited and reported in US$.

Galiano Gold Inc. Logo (CNW Group/Galiano Gold Inc.)

Asanko Gold Mine JV Key Metrics (100% basis):

Safety: No lost–time injuries ("LTI") and one total recordable injury ("TRI") recorded during the quarter, resulting in 12–month rolling LTI and TRI frequency rates of 0.37 and 1.12 per million employee hours worked, respectively.
Production performance and upward revised guidance: Gold production of 33,673 ounces during the second quarter. Year-to-date gold production of 66,351 ounces. Full year gold production guidance has been revised upward from between 100,000 to 120,000 ounces to between 120,000 to 130,000 ounces.
Milling performance: Achieved milling throughput of 1.5 million tonnes ("Mt") of ore at a grade of 0.8 g/t during the quarter. Metallurgical recovery in Q2 2023 was 85%.
Cost performance and cash flow: Total cash costs[1] of $1,127 per gold ounce ("/oz") and all-in sustaining costs1 ("AISC") of $1,374/oz for the three months ended June 30, 2023. Additionally, the JV generated positive cash flow from operations of $18.0 million and Free Cash Flow1 of $10.1 million during the quarter.
Financial performance: Gold revenue of $64.0 million generated from 32,912 gold ounces sold at an average realized price of $1,944/oz for the quarter. Net income of $24.4 million and Adjusted EBITDA1 of $25.5 million during the quarter.
Mining contract awarded: A competitive tender process was conducted during Q2 2023 and a preferred contractor was selected by the JV partners to resume mining operations at the AGM, with Abore scheduled to start in Q4 2023.
Exploration focus: Drilled 5,204 metres at Kaniago West with an objective to evaluate the strike and depth extent of the deposit in order to assess potential economic viability. Completed the extension drilling program at Nkran South.
Robust liquidity: $112.9 million in cash and cash equivalents, $12.0 million in gold sales receivables, $2.3 million in gold on hand and no debt as of June 30, 2023.
__________________________________

1 See "Non-IFRS Performance Measures"

Galiano Gold Highlights:

Stable balance sheet: Cash and cash equivalents of $55.5 million as at June 30, 2023, while remaining debt-free.
Positive earnings: Net income of $12.0 million or $0.05 per common share during the quarter, which includes the Company's share of the JV's net earnings for the quarter.
Board changes: Gordon Fretwell did not stand for re–election at the Company's Annual General Meeting and as such resigned as a director of the Company effective June 1, 2023. The Company would like to express its gratitude to Mr. Fretwell for his years of leadership and service to the Company.
"The second quarter saw continued momentum on achieving our stated milestones," stated Matt Badylak, Galiano's President and Chief Executive Officer, "We awarded a mining contract to restart mining at the Asanko Gold Mine during the fourth quarter, in line with the 2023 Technical Report schedule, while continuing to generate significant cash flows through stockpile processing. This has further strengthened the AGM's balance sheet in anticipation of a capital-intensive second half of 2023. At the corporate level, we closed the quarter with $56 million in cash, no debt, and remain in an enviable position to pursue accretive opportunities for growth. I am also pleased with the progress our health and safety teams have made to strengthen safety awareness across site, reinforce our commitment to Zero Harm and maintain a culture of best practices at the Asanko Gold Mine.

Looking ahead, as a result of higher metallurgical recoveries, we have increased the AGM's 2023 production guidance, from 100,000 to 120,000 ounces to between 120,000 to 130,000 ounces."

Asanko Gold Mine – Summary of quarterly operational and financial highlights (100% basis)

Asanko Gold Mine (100% basis)
Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022

Ore mined ('000t) - - - 144 675
Waste mined ('000t) - - - 107 1,320
Total mined ('000t) - - - 251 1,995

Strip ratio (W:O) - - - 0.7 2.0
Average gold grade mined (g/t) - - - 1.8 1.6

Mining cost ($/t mined) - - - 25.27 8.30
Ore transportation from Esaase ('000 t) 729 1,367 503 699 901
Ore transportation cost ($/t trucked) 5.88 5.51 6.19 6.55 6.19
Ore milled ('000t) 1,457 1,566 1,518 1,423 1,406

Average mill head grade (g/t) 0.8 0.9 0.8 1.1 1.3
Average recovery rate (%) 85 73 80 88 84
Processing cost ($/t milled) 11.01 9.78 10.06 10.45 10.40
G&A cost ($/t milled) 4.68 4.09 4.20 4.89 5.40

Gold produced (oz) 33,673 32,678 34,090 43,899 50,010
Gold sold (oz) 32,912 35,174 34,202 45,482 46,236

Average realized gold price ($/oz) 1,944 1,850 1,686 1,687 1,832
Total cash costs1 ($/oz) 1,127 1,083 1,031 1,001 1,218
All-in sustaining costs1 ($/oz) 1,374 1,268 1,191 1,178 1,431
All-in sustaining margin1 ($/oz) 570 582 495 509 401

All-in sustaining margin1 ($m) 18.8 20.5 16.9 23.2 18.5
Revenue ($m) 64.1 65.2 57.8 76.9 84.9

Income from mine operations ($m) 24.4 24.7 19.2 25.7 16.2
Adjusted net income1 ($m) 24.4 20.6 19.6 17.3 13.7

Cash provided by operating activities ($m) 18.0 18.9 11.1 26.1 34.3
Free cash flow1 ($m) 10.1 12.0 5.5 16.3 25.3

Asanko Gold Mine – Financial and operational highlights for the three and six months ended June 30, 2023 and 2022 (100% basis)

(All amounts in 000's of US dollars, unless otherwise stated)

Three months ended June 30, Six months ended June 30,

Asanko Gold Mine (100% basis)
2023 2022 2023 2022

Financial results
Revenue 64.066 84,885 129,259 162,417

Income from mine operations 24,406 16,244 49,063 26,796
Net income 24,378 15,803 44,992 2,165
Adjusted net income1 24,378 13,723 44,992 21,085
Adjusted EBITDA1 25,541 21,064 48,404 34,169
Cash and cash equivalent 112,914 70,283 112,914 70,283

Cash generated from operating activities 17,979 34,344 36,922 38,269
Free cash flow1 10,113 25,338 22,072 21,975
AISC margin1 18,760 18,541 39,286 30,593

Key mine performance data
Gold produced (ounces) 33,673 50,010 66,351 92,353

Gold sold (ounces) 32,912 46,236 68,086 88,165
Average realized gold price ($/oz) 1,944 1,832 1,896 1,839

Total cash costs ($ per gold ounce sold)1 1,127 1,218 1,104 1,286

AISC ($ per gold ounce sold)1 1,374 1,431 1,319 1,492

The AGM produced 33,673 ounces of gold during Q2 2023, as the processing plant achieved milling throughput of 1.5 Mt of ore at a grade of 0.8 g/t with metallurgical recovery averaging 85%. Compared to Q1 2023, recoveries improved from 73% to 85% due to the composition of the feed blend processed having a higher percentage of oxide ore during Q2 2023.
Sold 32,912 ounces of gold in Q2 2023 at an average realized gold price of $1,944/oz for total revenue of $64.1 million (including $0.1 million of by-product silver revenue), a decrease of $20.8 million from Q2 2022. The decrease in revenue quarter-on-quarter was primarily a function of a 29% reduction in sales volumes relative to Q2 2022, partly offset by a 6% increase in realized gold prices.
Income from mine operations for Q2 2023 totaled $24.4 million compared to income from mine operations of $16.2 million in Q2 2022. The increase in income from mine operations was due to a $29.0 million decrease in cost of sales (which resulted from fewer ounces sold, at a lower unit cost, driven by the successful labour cost restructuring completed in 2022 as well as processing ore that had no carrying value for accounting purposes), partly offset by the $20.8 million reduction in revenue described above.
Reported Adjusted EBITDA1 of $25.5 million in Q2 2023 compared to $21.1 million in Q1 2022. The increase in Adjusted EBITDA1 was largely driven by higher gold prices and lower operating costs as described above.
Despite inflationary cost pressures, the lower operating costs described above, resulted in a 7% reduction to total cash costs1 from $1,218/oz in Q2 2022 to $1,127/oz in Q2 2023.
AISC1 for Q2 2023 was $1,374/oz compared to $1,431/oz in the comparative period. AISC1 was lower in the current quarter predominately due to the decrease in total cash costs per ounce1 mentioned above, however capital costs were marginally higher on a per ounce basis due to significant investment in the next raise of the tailings storage facility.
The AGM generated $18.0 million of cash flow from operating activities and free cash flow1 of $10.1 million during Q2 2023. This compares to $34.3 million of cash flow from operating activities and free cash flow1 of $25.3 million during Q2 2022. Despite higher AISC margins1, the decrease in free cash flow1 was primarily due to fewer gold ounces sold in Q2 2023.
Galiano Gold Inc. – Financial highlights for the three and six months ended June 30, 2023 and 2022


Three months ended June 30,

Six months ended June 30,

(All amounts in 000's of US dollars, unless otherwise stated)
2023 2022 2023 2022

Galiano Gold Inc.

Net income 11,961 12,566 20,454 11,029

Net income per share - basic 0.05 0.06 0.09 0.05
Adjusted EBITDA1 9,634 (1,181) 16,374 (2,603)
Cash and cash equivalents 55,503 53,005 55,503 53,005

The Company reported net income of $12.0 million in Q2 2023, compared to net income of $12.6 million in Q2 2022. Net income was largely unchanged quarter-on-quarter as during Q2 2023 the Company recognized its share of the JV's net earnings of $11.0 million and a $2.4 million positive fair value adjustment on the Company's preference shares in the JV. During Q2 2022, the Company did not recognize its share of the JV's net earnings as the estimated recoverable amount of the Company's investment in the JV was nil as at June 30, 2022, while a $13.2 million positive fair value adjustment on the Company's preference shares in the JV was recorded.
Adjusted EBITDA1 for Q2 2023 amounted to $9.6 million, compared to a loss of $1.2 million in Q2 2022. The increase in Adjusted EBITDA1 was primarily a result of the Company's share of the JV's Adjusted EBITDA1. During Q2 2022, the Company did not recognize its share of the JV's net earnings as the recoverable amount of the Company's equity investment was estimated to be nil.
Cash used in operating activities in Q2 2023 was $1.4 million, compared to cash provided by operating activities of $2.6 million in Q2 2022. The increase in cash used in operating activities from Q2 2022 to Q2 2023 was driven by working capital movements, specifically related to the Company's service fee receivable from the JV.
As of June 30, 2023, the Company had cash and cash equivalents of $55.5 million, while remaining debt-free.


This news release should be read in conjunction with Galiano's Management's Discussion and Analysis
and the Unaudited Condensed Consolidated Interim Financial Statements for the three and six months
ended June 30, 2023 and 2022, which are available at www.galianogold.com and filed on SEDAR.

1 Non-IFRS Performance Measures
The Company has included certain non-IFRS performance measures in this news release. These non-IFRS performance measures do not have any standardized meaning and therefore may not be comparable to similar measures presented by other issuers. Accordingly, these performance measures are 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. Refer to the Non-IFRS Measures section of Galiano's Management's Discussion and Analysis for an explanation of these measures and reconciliations to the Company's and the JV's reported financial results in accordance with IFRS.

Total Cash Costs per Gold Ounce
Management of the Company uses total cash costs per gold ounce sold to monitor the operating performance of the JV. Total cash costs include the cost of production, adjusted for share-based compensation expense, by-product revenue and production royalties per ounce of gold sold.

All-in Sustaining Costs per Gold Ounce and All-in Sustaining Margin
The Company has adopted the reporting of "all-in sustaining costs per gold ounce" ("AISC") as per the World Gold Council's guidance. AISC include total cash costs, corporate overhead expenses, sustaining capital expenditure, sustaining capitalized stripping costs, reclamation cost accretion and lease payments made to and interest expense on the AGM's mining and service lease agreements per ounce of gold sold. Excluded from AISC are one-time severance charges in line with World Gold Council guidance. All-in sustaining margin is calculated by taking the average realized gold price for a period less that period's AISC.

EBITDA and Adjusted EBITDA
EBITDA provides an indication of the Company's continuing capacity to generate income from operations before taking into account the Company's financing decisions and costs of amortizing capital assets. Accordingly, EBITDA comprises net income (loss) excluding interest expense, interest income, amortization and depletion, and income taxes. Adjusted EBITDA adjusts EBITDA to exclude non-recurring items and to include the Company's interest in the Adjusted EBITDA of the JV. Other companies and JV partners may calculate EBITDA and Adjusted EBITDA differently.

Free cash flow
The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and analysts use free cash flow to evaluate the JV's performance with respect to its operating cash flow capacity to meet non-discretionary outflows of cash. The presentation of free cash flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. Free cash flow is calculated as cash flows from operating activities of the JV adjusted for cash flows associated with sustaining and non-sustaining capital expenditures and payments made to mining and service contractors for leases capitalized under IFRS 16.

Adjusted net income and adjusted net income per common share
The Company has included the non-IFRS performance measures of adjusted net income and adjusted net income per common share. Neither adjusted net income nor adjusted net income per share have any standardized meaning and are therefore unlikely to be comparable to other measures presented by other issuers. Adjusted net income excludes certain non-cash items or non-recurring items from net income or net loss to provide a measure which helps the Company and investors to evaluate the results of the underlying core operations of the Company or the JV and its ability to generate cash flows and is an important indicator of the strength of the Company's or the JV's operations and performance of its core business.

Qualified Person

Richard Miller, P.Eng., Vice President Technical Services with Galiano Gold Inc., is a Qualified Person as defined by Canadian National Instrument 43-101, Standards of Disclosure for Mineral Projects, and has approved the scientific and technical information contained in this news release.

About Galiano Gold Inc.

Galiano is focused on creating a sustainable business capable of value creation for all stakeholders through production, exploration and disciplined deployment of its financial resources. The Company operates and manages the Asanko Gold Mine, which is located in Ghana, West Africa, and jointly owned with Gold Fields. Galiano is committed to the highest standards for environmental management, social responsibility, and the health and safety of its employees and neighbouring communities. For more information, please visit www.galianogold.com