Kirkland Lake Gold Inc.

Kirkland Lake Gold Inc.

March 16, 2005 19:12 ET

Kirkland Lake Gold Reports 3rd Quarter Results


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: KIRKLAND LAKE GOLD INC.

TSX, AIM SYMBOL: KGI

MARCH 16, 2005 - 19:12 ET

Kirkland Lake Gold Reports 3rd Quarter Results

KIRKLAND LAKE, ONTARIO--(CCNMatthews - March 16, 2005) - Kirkland Lake
Gold Inc. (TSX:KGI)(AIM:KGI) (the "Company") announces the financial
results for the third quarter ended January 31, 2005.

Overview

- The Company incurred a loss for the third quarter ended January 31,
2005 (Fiscal 2005) of $6,331,651 or $0.14 per share, which includes the
expensing of $1,566,402 in exploration and $573,879 of non-cash costs
incurred during the quarter.

- While an operational loss for the 3rd quarter was forecast, the actual
loss was higher principally due to an actual grade mined of 0.32 ounces
of gold per ton (OPT) versus a forecasted grade of 0.38 OPT. Management
and operational changes were introduced to improve grade control, and
the Company is seeing the benefit this quarter.

- During the quarter, dilution decreased in both the conventional and
long hole stopes, productivity per manshift increased and in January
exceeded plan. Further, although the labour force remains below planned
levels, additional hiring reduced shortages, and the mechanical problems
experienced in new equipment were overcome.

- Gold revenues of $6,374,826 (2004- $3,390,189) were higher on a year
over year basis but below forecasted revenues.

- The three year, 1.3 billion gallon mine dewatering program approached
completion during the quarter and will be completed this month with the
pumps now below the 5700 level. Plans are underway to convert to a
normal maintenance pumping system, with significant savings.

- Gold production commenced from the newly discovered D Zone during the
quarter with access from both the newly constructed 3400 level as well
as the 3800 and will henceforth become an important part of the
production profile.

"The plan for March and going forward is to become operationally cash
break-even and at this point in mid-month, we are ahead of plan in
ounces produced for the first time," said Bob Rodrigue, the Company's
new Chief Financial Officer. "Over the several months our plan calls for
progressing towards internally funding capital and exploration programs."



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Financial Highlights
(all amounts in thousands of Canadian dollars,
except per share figures)

3 months 3 months 3 months
ended ended ended
January 31 January 31 October 31
2005 2004 2004
--------------------------------------------------------------------
Revenue 6,375 3,390 5,129
Operating Costs 9,703 6,480 9,505
Exploration Expenditure 1,566 1,294 2,908
Net (loss) before unusual item (6,113) (5,741) (8,886)
Per share (basic and diluted) (0.14) (0.19) (0.22)
Cash Flow (used) for operating
activities (7,247) (5,972) (7,582)
Net increase (decrease) in cash (4,113) 6,770 4,547
Cash at end of period 3,574 9,055 7,687
Short Term Investments -
unrestricted 10,000 - -
Total cash and cash equivalents 13,574 9,055 7,687
Total Current Assets 17,526 11,808 11,628
Total Current Liabilities 8,332 7,949 12,322
Working Capital 9,194 3,859 (694)
Weighted average of shares
outstanding 43,759,542 30,278,313 40,891,352
--------------------------------------------------------------------
--------------------------------------------------------------------
Production Highlights

3 months 3 months 3 months
ended ended ended
January 31 October 31 July 31
2005 2004 2004
--------------------------------------------------------------------
Tons broken (ore) 32,222 37,003 24,250
Tons broken (waste) 20,377 17,331 25,905
Tons milled 37,936 39,855 27,589
Ozs. produced 11,921 10,531 6,980
Lateral Development (feet) 2,267 2,982 3,246
Raise Development (feet) 634 598 683
Definition Drilling (feet) 27,188 24,616 22,444
--------------------------------------------------------------------


Gold sales during the latest fiscal quarter were 11,913 troy ounces with
an average gold price of $528 per ounce as underground production from
#3 Shaft continues to increase. This compares with gold sales of 6,416
ounces with an average sales price of $528 per ounce during the same
period of the prior year, and 9,775 ounces at $525 during the second
quarter 2005. During the third quarter of fiscal 2005, negative
operating cash flow amounted to $7,247,469 (2004- negative $5,972,256),
slightly improved over the second quarter, as underground development
and stoping activities continue to increase in efforts to raise gold
production to positive cash flow levels. Lastly, during the third
quarter the Company raised $14.7 million to fund its operations and
exploration activities.

During the third quarter, total capital invested in the Company's
operations was $2,707,772 as compared with $2,288,564 reported for the
same quarter of the prior year. Of the $2.7 million invested in its
operations, $397,313 (2004-$1,187,236) was spent on the purchase of
equipment, while the remaining $2,310,459 was invested in developmental
projects which included 2,103 feet of lateral development, along with
255 feet of raising. Included is substantial track development on the
3400 Level, ramp development to access the "D" Zone reserves, and
drifting on the 4500 and 4900 Levels.

The third quarter financial statements and accompanying Management
Discussion and Analysis (MD&A) are available on SEDAR at www.sedar.com
and at www.londonstockexchange.com/rns.

Appointment of new Chief Financial Officer

The Company is pleased to report that, effective March 14, 2005 the
Company appointed Bob Rodrique, as its new Chief Financial Officer. Mr.
Rodrigue joined the Company as Controller in December, 2003 and has made
a significant contribution in the Company's system of controls. Prior to
his employment with the Company, Mr. Rodrigue has served in senior
management accounting positions at a number of large Canadian
underground and open pit operations over the last 27 years.

About the Company

Kirkland Lake Gold Inc. is an operating gold mining company located in
Kirkland Lake, Ontario, which owns the Macassa Mine and Mill and four
contiguous former gold producing properties purchased on December 14,
2001. The Company's corporate goal is to expand its gold reserves and to
become a low cost gold producer. The Company's shares currently trade on
the TSX and on the AIM (Alternative Investment Market) of the London
Stock Exchange.


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Kirkland Lake Gold Inc.
    Brian Hinchcliffe
    President
    (705) 567-5208
    (705) 568-6444 (FAX)
    bhinchcliffe@klgold.com
    or
    Kirkland Lake Gold Inc.
    Scott Koyich
    Investor Relations
    (403) 215-5979
    info@klgold.com
    www.klgold.com
    Neither the Toronto Stock Exchange nor the AIM Market of the London
    Stock Exchange has reviewed and neither accepts responsibility for the
    adequacy or accuracy of this news release.