AuRico Metals Reports 2016 Second Quarter Results

Toronto (ots/PRNewswire) -

Increases Royalty Revenue Guidance and Expands Kemess East
Exploration Program

AuRico Metals Inc. (TSX: AMI),("AuRico" or the "Company") today
reported its financial results for the quarter ended June 30, 2016.
The Company also announced increased guidance on royalty revenue and
an expanded exploration program at Kemess East. For complete details
of the Financial Statements and associated Management's Discussion
and Analysis for the quarter ended June 30, 2016, please see the
Company's filings on SEDAR (http://www.sedar.com) or the Company's
website (http://www.auricometals.ca). All amounts are in US dollars
unless otherwise indicated.

Recent Highlights

- On August 2, 2016, the Company announced a C$10.0 million bought
deal equity financing whereby the Company will issue 10,000,000
common shares at C$1.00 per share. The Company has granted the
underwriters an over-allotment option to purchase up to an
additional 1,500,000 common shares under the same terms;
- On August 8, 2016, the Company announced that Alamos Gold Inc.
("Alamos") has exercised its participation right with respect to
the bought deal announced above. As a result, the Company will
issue up to an additional 1,273,000 common shares through a private
placement at C$1.00 per share;
- During Q2 2016, recognized royalty revenue of $2.0 million,
comprised of $0.9 million from the Fosterville royalty, $0.8
million from the Young-Davidson royalty, and $0.3 million from the
Hemlo, Eagle River and Stawell royalties;
- On July 29, 2016, Newmarket Gold Inc. ("Newmarket") announced that
it has increased guidance at Fosterville to 130,000 to 140,000
ounces for 2016, up from previous guidance of 110,000 to 120,000
ounces;
- On July 27, 2016, Barrick Gold Corporation ("Barrick") announced
that it has increased guidance at Hemlo to 215,000 to 230,000
ounces for 2016, up from previous guidance of 200,000 to 220,000
ounces;
- The Company has increased its royalty revenue guidance to between
$7.7 million to $8.1 million from its original guidance of $6.6
million to $7.1 million;
- The Company has expanded its Kemess East exploration program to
$4.4 million this year with a focus on further expanding and
infilling the previously announced resource. The increased program
has been funded by CEE ("Canadian Exploration Expenses")
flow-through financings for $2.7 million completed subsequent to
June 30th;
- On May 12, 2016, the Company announced that the Company's
application for an Environmental Assessment ("EA") Certificate for
the Kemess Underground Project entered the 180-day review period;
and
- On May 6, 2016, the Company announced that it had filed the
National Instrument 43-101 technical report for the Kemess
Underground Project and the Kemess East Resource Estimate.

Commenting on the results, Chris Richter, President and CEO
stated, "We are pleased to report a fourth consecutive quarter of
higher royalty revenue and to be increasing our annual royalty
revenue guidance. At Kemess we are advancing through the EA review
process and are keen to accelerate permitting efforts over the
remainder of the year. We are particularly excited about our
expanded exploration program at Kemess East and look forward to the
results from three drills currently in operation."

Operations Update

Royalties

The Company estimates quarterly revenue from its royalty assets
based on a combination of guidance and recent production of the
underlying operations. Revenues are adjusted in the subsequent
quarter to reflect actual royalty payments received, should they
differ from the estimated revenue.

During the three and six months ended June 30, 2016, the Company
recognized revenues from the following royalties:

(in millions) Q2 2016 Year-to-date 2016
Revised Guidance
Fosterville 2% NSR royalty $0.9
$1.6 $3.4 - $3.5
Young-Davidson 1.5% NSR royalty $0.8
$1.5 $3.3 - $3.4
Other royalties
$0.3 $0.5 $1.0 - $1.2
Total
$2.0 $3.6 $7.7 - $8.1

The Company recognized revenue of $0.9 million from the
Fosterville 2% NSR royalty in the three months ended June 30, 2016.
In Q2 2016, Fosterville announced another record quarter, producing
37,245 ounces at a mill grade of 7.50 grams per tonne gold. This is
a 12% increase over production of 33,138 ounces in Q1 2016 which was,
at that time, a record. Record production during the first half of
2016 has led Newmarket to increase its production guidance at
Fosterville to 130,000 to 140,000 ounces, up from previously
announced guidance of 110,000 to 120,000 ounces. In addition,
Newmarket reported encouraging drill intercepts at its Harrier South
gold system during the quarter, including 22.13 gold grams per tonne
over 3.4 metres in hole UDH 1559 (please refer to the press releases
dated June 27, 2016, July 12, 2016 and July 29, 2016 available on
Newmarket's website at http://www.newmarketgoldinc.com).

During Q2 2016, the Company recognized revenue of $0.8 million
from the Young-Davidson 1.5% NSR royalty. Underground mining rates
at Young-Davidson in Q1 2016 averaged 5,776 tonnes per day ("TPD"),
increasing to an average of 6,300 TPD in April. Alamos notes that
the operation remains on target to achieve 7,000 TPD by the end of
2016, which will have a favorable impact on production in the second
half of 2016 (please refer to the press release dated May 12, 2016
available on Alamos' website at http://www.alamosgold.com).

The Company's 1% NSR royalty on the Stawell mine in Victoria,
Australia, commenced on January 1, 2016 in accordance with the NSR
agreement. The Company recognized revenue of $0.1 million from this
royalty in Q2 2016, based on 8,504 ounces of production during the
quarter. Newmarket continued drilling the Aurora B gold discovery
during the quarter, completing an eight hole drill program which
successfully demonstrated the continuation of mineralization both up
and down plunge. Drilling on Aurora B will continue in the third
quarter with two rigs operational (please refer to the press release
dated July 12, 2016 available on Newmarket's website
athttp://www.newmarketgoldinc.com).

During Q2 2016, the Company recognized revenue of $0.1 million
from its 0.25% royalty on the Williams mine at Hemlo. During the
quarter, Barrick announced total production of 52,000 ounces at
Hemlo, a 24% increase from the 42,000 ounces produced in the second
quarter of 2015. On July 27, 2016, Barrick announced that it has
increased guidance at Hemlo to 215,000 to 230,000 ounces for 2016, up
from previous guidance of 200,000 to 220,000 ounces. Not all
production at Hemlo is attributable to the Company's Williams-Hemlo
royalty, therefore, total attributable production will be less than
the Q2 2016 production reported by Barrick (please refer to the 2016
Q2 Mine Statistics, and the press release dated July 27, 2016, both
available on Barrick's website at http://www.barrick.com).

The Company recognized revenue of $0.1 million from its 0.5% NSR
royalty on the Eagle River underground mine during the three months
ended June 30, 2016. In Q2 2016, the Eagle River underground mine
reported production of 10,210 ounces. During the quarter, Wesdome
Gold Mines Ltd. ("Wesdome") also released encouraging initial results
from its 7 Zone exploration program, including the results of 15
underground drill holes. The 7 Zone has now been traced 200 metres
up-plunge from existing reserves to the 840 metre level and continues
to remain open towards surface (please refer to the press releases
dated May 11, 2016 and May 31, 2016 available on Wesdome's website at
http://www.wesdome.com).

Kemess Underground

The British Columbia Environmental Assessment Office ("EAO")
initiated the 180 day EA review period on May 11, 2016. As of July
11, initial questions and comments from working group members, the
general public and our First Nations partners had been received. By
August 5, the Company had provided responses to 88% of these
comments.

On August 2, the Company sent a letter to the EAO requesting an
eight week extension to the application review period on account of
the Company receiving many of the comments referenced above later
than anticipated, and to accommodate a request from our First Nations
partners for additional time for community engagement, which the
Company supports. The Company's request for an extension was granted
on August 4th.

Towards the end of the review period, the EAO will conclude their
assessment and submit their report to both the provincial and federal
ministers for their respective decisions. These decisions are
expected in Q1 2017.

Kemess East

The Company has increased its planned drilling at Kemess East from
$1.7 million to $4.4 million, having raised additional exploration
funds through flow-through financings completed on July 22, 2016 and
August 3, 2016. The ongoing drill campaign is focused on infilling
and expanding the high grade core of Kemess East which was identified
in 2015. The Company currently has 3 drills turning and the first
set of assay results are expected in the near future.

Near-Term Corporate Objectives

The Company's objectives over the next several months include:

- Evaluate potential royalty acquisition opportunities;
- Progress EA review for Kemess Underground;
- Commence permitting and detailed engineering for Kemess
Underground;
- Release the results of an expanded summer drill campaign at Kemess
East (Q3 and Q4 2016); and
- Continue efforts to reduce care and maintenance costs at the Kemess
site to targeted levels by the end of 2016.

Outlook

The Company provided its initial annual outlook within its MD&A
for the year ended December 31, 2015, and re-confirmed this guidance
in its Q1 MD&A. The Company is updating its guidance and now expects
the following for the full year (assuming a 0.75 CAD to USD exchange
rate):

(in millions)
Original Revised
Royalty revenues (pre-tax)
$6.6 to $7.1 $7.7 to $8.1
Royalty revenues
(after-tax) $5.6 to $6.1 $6.6 to $7.0
General and administrative expense, excluding stock-based

compensation $2.5
$2.5
Care and maintenance expense
$4.5 $4.5
Kemess Underground project capital
expenditures $1.5 to $2.5 $3.0 to $3.8
Kemess East
exploration expenditures $1.7
$4.4

The Company has reported stronger revenues to date, as a result of
both an improvement in gold prices, and increased production from the
Fosterville mine in the first half of 2016. In its most recent
forecast, the Company has revised its assumed gold price to $1,300
per ounce for the second half of the year, and has increased its
production assumptions at Fosterville to be in line with revised
Newmarket guidance of 130,000 to 140,000 gold ounces.

Conditional on the closing of the announced bought deal financing,
the Company will increase its guidance for expenditures on Kemess
Underground from a range of $1.5 million to $2.5 million to a range
of $3.0 million to $3.8 million. The additional spend relates to
accelerating permitting efforts for Kemess Underground during the
remainder of 2016.

The Company has increased its guidance on exploration spending at
Kemess East to $4.4 million. These expenditures have been funded
through flow-through financings completed subsequent to June 30,
2016.

Preliminary Short Form Prospectus

In connection with the recently announced bought deal equity
financing the Company expects to file its preliminary short form
prospectus by the end of day on August 8, 2016.

About AuRico Metals

AuRico Metals is a mining royalty and development company whose
producing gold royalty assets include a 1.5% NSR royalty on the
Young-Davidson Gold Mine, a 0.25% NSR royalty on the Williams Mine at
Hemlo, and a 0.5% NSR royalty on the Eagle River Mine - all located
in Ontario, Canada. AuRico Metals also has a 2% NSR royalty on the
Fosterville Mine and a 1% NSR royalty on the Stawell Mine, located in
Victoria, Australia. Aside from its diversified royalty portfolio,
AuRico owns (100%) the advanced Kemess Gold-Copper Project in British
Columbia, Canada. AuRico Metals' head office is located in Toronto,
Ontario, Canada.

Cautionary Statement

This press release contains forward-looking statements and
forward-looking information as defined under Canadian and U.S.
securities laws. All statements, other than statements of historical
fact, are, or may be deemed to be, forward-looking statements. The
words "expect", "believe", "anticipate", "will", "intend",
"estimate", "forecast", "budget" and similar expressions identify
forward-looking statements. Forward-looking statements include
statements related to the Company's outlook and key deliverables for
Kemess over the next year. These statements are based on a number of
factors and assumptions that, while considered reasonable by
management at the time of making such statements, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Known and unknown factors could
cause actual results to differ materially from those projected in the
forward-looking statements. Such forward-looking statements and the
factors and assumptions underlying them in this document include, but
are not limited to:

- Royalty revenue guidance may be impacted by the performance of the
Young-Davidson, Fosterville, Stawell, Hemlo and Eagle River mines.
Management has based its revenue assumptions on the latest guidance
provided by the operators of these assets, but there is uncertainty
as to whether operators will achieve stated production guidance.
Royalty revenue is also based on an assumed gold price of $1,300
per ounce. The Company's gold price assumption may be inaccurate;
every $50 change in gold price assumption impacts after-tax revenue
by $0.2 million (for the last 6 months of 2016).
- General and administrative expense guidance may be impacted by
changes in foreign exchange rates, employee relations, litigation,
and business opportunities that may be pursued by the Company.
- Care and maintenance expense guidance may be impacted by changes in
foreign exchange rates, employee relations, electricity rates in
British Columbia, weather in the region surrounding the Kemess
site, equipment reliability, quality of service received by vendors
and consultants, and the price of consumables.
- Kemess underground capital expenditures are at the Company's
discretion and will be impacted by changes in foreign exchange
rates, the number of comments or questions raised by First Nations
partners, working group members, and the general public during the
EA review period, additional studies required in order to address
concerns raised and the results of those studies, the results of
the Company's updated feasibility study, optimization efforts by
management, and credit market conditions and conditions in
financial markets generally.
- The estimates, models and assumptions contained in the Feasibility
Study, which may be impacted by changes in commodity prices and the
exchange rate between the Canadian dollar and US dollar from
assumed levels, estimated future production and cost of sales
forecasts meeting expectations, estimated labour and materials
costs being consistent with the Company's expectations, the
accuracy of current mineral reserve and mineral resource estimates
as contemplated by the Feasibility Study, the viability of Kemess
Underground including, but not limited to, permitting, development
and expansion being consistent with the Company's current
expectations, access to capital markets, including but not limited
to identifying financing options and securing partial project
financing for the Kemess Underground project, being consistent with
the Company's current expectations.
- The estimates, models and assumptions contained in the Kemess East
Mineral Resource estimate, which may be impacted by changes in
commodity prices and the exchange rate between the Canadian dollar
and US dollar from assumed levels, the accuracy of current mineral
resource estimates, as contemplated by the Mineral Resource
estimate, and metallurgical recoveries being consistent with the
Company's current expectations.

The Company has made forward-looking statements relating to
corporate objectives and key deliverables over the next 12 months,
including permitting and the EA, the Company's ability to fund
forecasted cash shortfalls, the Company's ability to create value for
shareholders, sufficiency of working capital for future commitments
and other statements that express management's expectations or
estimates of future performance.

Actual results and developments are likely to differ, and may
differ materially, from those expressed or implied by the
forward-looking statements contained herein. Such statements are
based on a number of assumptions which may prove to be incorrect,
including assumptions about: business and economic conditions;
commodity prices and the price of key inputs such as labour, fuel and
electricity; credit market conditions and conditions in financial
markets generally; development schedules and the associated costs;
ability to procure equipment and supplies and on a timely basis; the
timing and ability to obtain permits and other approvals for projects
and operations including provincial and federal approval of the
environmental assessment application; the ability to attract and
retain skilled employees and contractors for the operations; the
accuracy of reserve and resource estimates; the impact of changes in
currency exchange rates on costs and results; interest rates;
taxation; and ongoing relations with employees and business partners.
The Company disclaims any intention or obligation to update or revise
any forward-looking statements whether as a result of new
information, future events or otherwise, except as required by
applicable law.

Readers are cautioned that forward-looking statements are not
guarantees of future performance. All of the forward-looking
statements made in this press release are qualified by these
cautionary statements. The Company disclaims any intention or
obligation to update or revise any forward-looking statements whether
as a result of new information, future events or otherwise, except as
required by applicable law.

Other information

The technical information disclosed in this press release relating
to the Kemess Underground project, Kemess East Mineral Resource and
the Company's Young-Davidson and Fosterville NSR royalties has been
approved by Mr. John Fitzgerald, an officer of the Company, who is a
qualified person within the meaning of National Instrument 43-101.

Please visit the AuRico Metals website at
http://www.auricometals.ca or contact: Chris Richter, President and
Chief Executive Officer, AuRico Metals Inc., +1-416-216-2780,
chris.richter@auricometals.ca; David Flahr, Vice President, Finance,
AuRico Metals Inc., +1-416-216-2780, david.flahr@auricometals.ca

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