Richmont Announces 4th Quarter and 2016 Financial Results

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Recent Corporate Highlights

• On February 2, 2017, Richmont announced a projected increase of up to 15% in 2017 company-wide production guidance to between 110,000 and 120,000 gold ounces, including high-quality production growth from the Island Gold Mine to between 87,000 and 93,000 gold ounces. The increase in production is expected to drive a decrease of up to 8% in cash costs both company-wide and at the Island Gold Mine.
• On January 31, 2017, Richmont announced Mineral Reserves and Resources as of December 31, 2016. Mineral Reserves at the cornerstone Island Gold Mine increased by 34% (net of depletion) to 752,200 ounces of gold, at an increased grade of 9.17 g/t gold. Inferred resources increased by 30% (net of conversion) to 995,700 gold ounces, at an increased grade of 10.18 g/t, at an average discovery cost of less than $35 per ounce.
• On January 25, 2017, Richmont announced the appointment of Mr. Rob Chausse as Chief Financial Officer effective March 20, 2017.
• On December 19, 2016, Richmont announced the receipt of the required permit amendments that allow for ore mining and processing rate increases to an average of 1,100 tonnes per day as contemplated in the Expansion Case Preliminary Economic Assessment (“Expansion Case PEA”) that is currently under review.

“We have reported a number of key milestones for 2016, including record company-wide production. The strong performance was driven by another consecutive year of solid results from the Island Gold Mine, which exceeded all annual production and cost guidance metrics,” stated Renaud Adams, CEO. He continued, “2016 was a pivotal year for Island Gold. During the year we completed a strategic underground mine and mill upgrade, advanced the accelerated underground development program and received the amended permits to increase mine and mill throughput rates to 1,100 tonnes per day. In 2017 we will continue to focus on positioning the Island Gold Mine for long-term success that drives shareholder value creation, which is supported by a solid balance sheet and a disciplined management team.”

Financial Highlights

Operational Highlights

Island Gold Mine Highlights

• At the end of the year, the Island Gold Mine reported over 6 years of operations without lost-time injury.
• Production for the quarter was 24,086 ounces of gold (22,422 ounces sold) and 83,323 ounces of gold (82,273 ounces sold) for the year, a 51% increase over 2015, exceeding revised production guidance for the year.
• Cash costs for the quarter were $826 per ounce (US$619 per ounce). Cash costs for 2016 were $779 per ounce (US$587 per ounce), a 24% decrease over 2015 and below revised guidance for the year.
• AISC for the quarter were $912 per ounce (US$683 per ounce). AISC for 2016 were $988 per ounce (US$745 per ounce), a 32% decrease over 2015 and below revised guidance for the year.
• Underground mine and mill productivities for the quarter averaged 977 and 903 tonnes per day, respectively, which is consistent with the 2017 production scenario considered in the Expansion Case PEA that is currently under review. For 2016, underground mine and mill productivities averaged 869 and 814 tonnes per day, respectively, a 32% and 23% improvement over 2015.
• During the quarter, long-hole stope mining began in the eastern and western extensions of the second mining horizon and development in ore began in the higher-grade third mining horizon.
• The development of the main ramp continued and reached a vertical depth of 846 metres at the end of the quarter. It is expected that the ramp will reach the bottom of the higher-grade third mining horizon at the 860 metre level in the first quarter of 2017.
• Approximately $6 million of the planned project capital for 2016 was not incurred during the year and a majority of that amount has subsequently been included in the 2017 expansion capital guidance.
• Mill head grade for the quarter was 9.31 g/t gold, an increase over the prior two quarters, primarily due to the increased contribution of higher-grade development ore from the third mining horizon and a positive grade reconciliation of 10% (mined vs. December 31, 2015 Mineral Reserves).
• During the quarter, Richmont received the required permit amendments that allow for an ore mining and processing rate increase to an average of 1,100 tonnes per day as contemplated in the Expansion Case PEA that is currently under review.

Beaufor Mine Highlights

• Production for the quarter increased over prior quarters to 5,419 ounces of gold (5,337 ounces sold) at cash costs of $1,480 per ounce (US$1,110 per ounce) and AISC of $1,904 per ounce (US$1,428 per ounce). Underground productivity increased over the prior two quarters to an average of 302 tonnes per day at a higher mill head grade of 6.16 g/t gold (8.78 g/t in December) as a result of improved mobile equipment availability and increased stope mining activities in the higher-grade Q Zone. For 2016, the mine produced 19,562 ounces of gold (19,216 ounces sold) at cash costs of $1,444 per ounce (US$1,090 per ounce) and AISC of $1,854 per ounce (US$1,399 per ounce).
• Grades and underground productivity are expected to continue to increase in future quarters as a greater proportion of stope mining is planned from the higher grade Q Zone and expanded mobile equipment capacity and availability continue to be improved.
• Annual production for the Quebec Division, which includes the Beaufor and Monique Mines, was 20,727 ounces of gold. Cash costs for the year were $1,429 per ounce (US$1,079 per ounce) and AISC were $1,816 per ounce (US$1,371 per ounce), underperforming revised guidance for the year.
• Mine life at the Beaufor Mine is currently less than two years (based on reserves) and as a result, the depreciation will be higher in 2017.

Upcoming News & Events

• Exploration Update (Late Q1 2017)
• Expansion Case PEA (Q2 2017)
• Annual General and Special Meeting of Shareholders (May 4, 2017)

Financial Statements and Management’s Discussion and Analysis

The financial statements and related Management’s Discussion and Analysis can be found on the Corporation’s website at www.richmont-mines.com or under the Corporation’s profile on www.sedar.com and with the Securities and Exchange Commission at www.sec.gov/edgar.shtml.

Webcast and Conference Call

Senior management discussed the 2016 financial results in a webcast and conference call on that was heldTuesday, February 21, 2017 starting at 8:30 a.m. Eastern Time.

A replay will be available until March 7, 2017 by dialing 1-416-764-8677 (Toronto local and international) or 1-888-390-0541 (toll free in Canada and U.S.), using pass code 420436#. The webcast and presentation slides will be archived on the Corporation’s website at www.richmont-mines.com.