Luna Gold Announces Results for the First Quarter of 2013

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 14, 2013) - Luna Gold Corp. (TSX:LGC)(OTCQX:LGCUF)(LMA:LGC) ("Luna", or the "Company") today announced its operational and financial results for the three month period ended March 31, 2013 ("first quarter").

FIRST QUARTER 2013 HIGHLIGHTS

Operational and Financial Results (all financial amounts in US dollars)

• Gold production of 17,203 ounces in the first quarter at an average unit cash cost of production of $757 per ounce and an average all-in cash cost of production of $1,033 per ounce
• Revenues of $17.3 million at an average realized gold price of $1,606 per ounce
• Gross profit of $5.6 million
• Net loss of $0.6 million (Loss per share $0.01)
• Operating cash inflow before working capital movements of $4.2 million ($0.04 per share)

Company Developments

• Completed and released an updated Measured and Indicated Mineral Resource and Proven and Probable Mineral Reserve at its Aurizona Gold Mine, increasing Proven and Probable Mineral Reserves to 2.36 million ounces at the Piaba Gold Deposit, representing a 222% increase when compared to the Piaba July 2010 reserve statement
• Completed an independent Mineral Resource update at the Company's Aurizona Gold Mine, resulting in the Company increasing Measured and Indicated Resources to 3.63 million ounces and inferred resources to 1.04 million ounces
• The Aurizona process plant expansion ("Phase I Expansion") commenced construction and remains on budget with $5.8 million of contingency remaining available. Approximately 74% of the engineering, procurement, and construction management ("EPCM") was completed as at the date of this report
• Announced positive assay results from the exploration drill program at the 100% owned Touro target in the Luna Greenfields. The goal is to define a National Instrument 43-101 compliant resource estimate
• Completed a new $30.0 million corporate secured revolving credit facility with Société Générale and Mizuho Corporate Bank
• Appointed Geoff Chater as a Director of the Company

For complete details on the first quarter 2013 results, please refer to the Financial Statements, and Management Discussion and Analysis on SEDAR or the Company's website, www.lunagold.com.

STRATEGIC OUTLOOK

The Company remains on target to achieve annual gold production between 95,000 and 105,000 ounces at an average annual cash cost of $705 to $715 per ounce of gold.

The Company is in the process of implementing cost reduction initiatives and has revised its 2013 financial plan in response to reduced gold price expectations for the year. Management has reviewed its current expenditure plans in development, operations and exploration with the goal of reducing expenditures with as minimal impact as possible to the gold production and the Phase I Expansion.

As a result, management has initiated expenditure reductions as follows:

• All sustaining capital projects are under re-evaluation to maximize return on capital invested and protect the cash position of the Company
• The Company is targeting a reduction of 50% of sustaining capital from the previous guidance
• Exploration expenditure has been reduced by 35% for the remainder of 2013

The completion of the Phase I Expansion remains on track for completion in December 31, 2013. However, plans have been prepared to slow down this expansion if necessary in the event that the gold price continues to decline.

At Luna Greenfields, the Company's strategy is to reduce fieldwork to limited surface exploration programs that are required to maintain key exploration licences. These programs will include soil sampling, geologic mapping and auger drilling. The diamond drill program at the Touro target has been put on hold and work in this area will focus on defining new targets and improving the geologic model through desktop studies to permit the Company to rapidly advance this target in the future.

Further review of expenditure plans is ongoing, including a review of corporate expenditure and employee reduction plans.

FIRST QUARTER RESULTS

Gold production during the first quarter of 2013 was 7% higher than the comparative quarter of 2012, but negatively impacted by drought conditions that persisted to the end of February 2013. The increase was the result of improvements in the gold recovery percentage and higher grade ore processed. However, the 17,203 ounces of gold produced was lower than the original guidance of 21,000 ounces but above revised guidance. The shortfall against the Company's original guidance was due to the drought conditions in January and February 2013. This resulted in a shortage of process water which reduced ore processing through the mill in January and February of 2013. The rains arrived in late February and operations returned to normal. In order to compensate for the production shortfall in January and February, management elected to process higher grade ore for the remainder of the quarter. This resulted in Aurizona producing a monthly record of approximately 9,300 ounces of gold during March of 2013.

COMMENTARY

"The beginning of 2013 has seen Luna Gold presented with two external challenges," stated John Blake, Luna's President and CEO. "The first of these challenges, unfortunate drought conditions during January and February, is behind us and season rains are continuing. While these conditions did impact Aurizona's production during the first quarter, our guidance for 2013 has not changed. I am confident that we will make up this shortfall over the balance of the year. The second challenge Luna is experiencing is a period of market uncertainty that has had a dramatic impact upon the price of gold. We are focusing on cash conservation measures by reducing all discretionary expenditures."

"Market conditions influence both our development schedule and the pace of our exploration efforts," concluded Mr. Blake. "However, the potential of our properties is as promising as ever. This potential was reaffirmed by Aurizona's recent reserve and resource updates. I remain confident that we will continue to unlock this potential over coming quarters, and deliver value to our loyal shareholders."

CONFERENCE CALL DETAILS

Luna will host a conference call to discuss both the Company's financial results and ongoing corporate developments. This call is scheduled to take place today, May 14, 2013 at 11:00 am Eastern Standard Time.

Toll Free (North America): +1 866 226 1793

Toronto Local and International: +1 416 340 2218

Webcast: http://www.gowebcasting.com/4347

A replay of the call will be available until May 28, 2013. The replay may be access by dialing either +1 905-694-9451 (Toronto Local and International) or +1 800-408-3053 (Toll Free). The passcode for the replay is 1948527.

About Luna Gold Corp.

Luna is a gold production and exploration company engaged in the operation, discovery, and development of deposits and advanced stage projects in Brazil.

On behalf of the Board of Directors

LUNA GOLD CORP.

John Blake - President and CEO

Website: www.lunagold.com

Forward-Looking Statements

This release contains certain "forward-looking statements" and certain "forward-looking information" as defined under applicable Canadian and U.S. securities laws. Forward-looking statements can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology. Forward-looking statements include, but are not limited to, statements with respect to future gold production and/or the results of analysis on gold production. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in Luna Gold Corp.'s periodic filings with Canadian Securities Regulators. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, the potential for delays in exploration or development activities, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties with or interruptions in production and operations, fluctuating metal prices, unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, regulatory restrictions, including environmental regulatory restrictions and liability, competition, loss of key employees, and other related risks and uncertainties. The Company undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.