Galantas Gold Corporation (the 'Company') (TSX VENTURE:GAL)(AIM:GAL) is pleased
to announce its annual financial results for the Year Ended December 31, 2012. 


Financial Highlights 

The Net Loss for the Year Ended December 31, 2012 amounted to $ 593,866 which
compared with a Net Income of $ 1,610,990 for the Year Ended December 31, 2011.
The cash generated from operating activities before changes in non-cash working
capital for 2012 amounted to CDN$ 177,737 (2011: $ 2,885,412). Highlights of the
2012 results, which are expressed in Canadian Dollars, are:




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                                                     Year Ended December 31 
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All in CDN$                                           2012             2011 
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Revenue                                    $     4,659,330  $     9,492,157 
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Cost of Sales                              $     3,167,126  $     4,860,427 
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Income before the undernoted               $     1,492,204  $     4,631,730 
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Amortization                               $       748,711  $       837,068 
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General administrative expenses            $     1,604,162  $     2,264,226 
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Gain on disposal of property, plant and                                     
 equipment                                 $       (86,816) $          (485)
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Gain on debt extinguishment                $      (190,624) $             0 
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Foreign exchange (gain) loss               $        10,637  $       (80,069)
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Net Income (Loss) for the year             $      (593,866) $     1,610,990 
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Working Capital (Deficit)                  $    (2,309,307) $      (536,142)
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Cash generated from operating activities                                    
 before changes in non-cash working                                         
 capital                                   $       177,737  $     2,885,412 
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Cash at December 31, 2012                  $     1,164,868  $     4,240,481 
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Sales revenues for the year ended December 31, 2012 amounted to CDN$ 4,659,330
(2011: CDN$ 9,492,157). The reduction in sales revenues when compared to 2011
was due to the lower level of metal produced and shipped during the year. The
lower production levels were primarily due to the requirement to process lower
grade ore from stockpile as a result of difficulties in accessing the lower part
of the ore-body in the northern section of the Kearney Open Pit, as a result of
the Company being unable to transport surplus rock off-site, following the
planning consent being quashed on the grounds of procedural failure by the
Planning Service. 


Cost of sales for the year ended December 31, 2012 amounted to CDN$ 3,167,126
(2011: CDN$ 4,860,427). There was a decrease in various production costs at the
Omagh mine during 2012 including production wages reflecting the reduced number
of personnel arising from the rationalization programme, Oil and Fuel costs,
Repairs and servicing costs and usage of Consumables which reductions were
mainly attributable to the reduced level of mining activity during 2012. There
was a non-cash gain of CDN$ 190,624 (2011: CDN$ Nil) during 2012 following the
extinguishment of the Company's convertible debenture debt during the second
quarter.


The Net Loss for the year ended December 31, 2012, amounted to CDN$ 593,866
(2011: Net Income CDN$ 1,610,990). The cash generated from operating activities
before changes in non-cash working capital for 2012 amounted to CDN$ 177,737
(2011: $ 2,885,412). The cash generated from operating activities after changes
in non-cash working capital for 2012 amounted to CDN$ 569,610 (2011: $
3,319,637). The cash generated from operating activities continued to contribute
towards the cost of the exploration drilling programme at the Omagh mine. 


The Company had cash balances at December 31, 2012 of CDN$ 1,164,868 compared to
CDN$ 4,240,081 at December 31, 2011. The working capital deficit at December 31,
2012 amounted to CDN$ 2,309,307 which compared with a deficit of CDN$ 536,142 at
December 31, 2011.


Production Highlights

Production at the Omagh mine for the year ended December 31, 2012 is summarized
below:




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                                                     Year Ended December 31 
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                                                  2012                 2011 
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Tonnes Milled                                   44,112               46,871 
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Average Grade g/t gold                             2.3                 4.46 
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Dry Tonnes Concentrate                           1,008                2,265 
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Concentrate Gold Grade (g/t)                     100.9                 88.9 
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Gold Produced - kg (troy ozs)       101.7 kg (3,271 oz)  201.5 kg (6,479 oz)
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Concentrate Silver Grade (g/t)                   227.6                234.0 
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Silver Produced kg (troy ozs)       229.5 kg (7,379 oz) 531.3 kg (17,082 oz)
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Lead Produced (tonnes)                            61.4                280.1 
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Gold Equivalent (troy ozs)                       3,507                7,308 
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Whilst ore milled during year ended December 31, 2012, at 44,112 tonnes, was 6%
below ore milled in both concentrate and metal production in the third quarter
were significantly lower than the year ended December 31, 2011 which was
primarily due to the low grade of the ore milled. These low grades are directly
attributable to the processing of low grade material during 2012. The high level
of low grade material processed was due to the increasing lack of available ore
from the Kearney open pit. Mine production during the year was mainly from the
Kearney and Kerr veins. Production from Kearney, which had been adversely
effected by the surplus rock stockpile on the site during the first half of the
year became totally restricted in the third quarter when the surplus rock
stockpile reached capacity levels. This surplus rock was due to commence being
transported from the site during the third quarter with the Omagh mine having
completed construction of public road improvements at its own cost to comply
with the conditions of the recent planning consent. However, following a
judicial review brought by a private individual on the grounds of procedural
failings by Planning Service, the planning consent was quashed. This ongoing
limitation has and will result in low grade material continuing to be worked for
the foreseeable future which will have an adverse effect on both the Company's
revenues and its ability to generate cash from operations. Because of adverse
impact the current and future production levels would have on future revenues a
number of redundancies were made during the fourth quarter to further reduce the
workforce. 


Mining from the Kerr veins during the year was reasonably successful with one of
the veins mined (vein no.4) being of high grade. Kerr produced small quantities
of high grade material, which was used to sweeten the grade of material to the
processing plant.


Whilst the modifications that were made to the flotation and crushing circuits
in 2011 and in the first quarter of 2012 proved to be successful, some further
changes were completed later in 2012 to increase throughput. Production was
hampered during the year by the ongoing variations in the metallurgy due to the
inconsistent grade of ore being milled and an increased clay content.
Improvements to the milling circuit, which resulted in decreased labour costs
were completed in the fourth quarter and will contribute towards the Company's
objective to achieve positive cash flow from operations in 2013.


Exploration

The major focus of exploration activities in 2012 was the continuation of the
successful drilling programme. In total 16,347 metres have been drilled since
the programme commenced in March 2011 and significant gold intersects have been
reported.


The drilling programme expanded considerably at the commencement of 2012 with
six drills operational during the first half of the year. The second half of the
year saw the number of rigs progressively reduce. Three rigs remained to the end
of the third quarter and one rig by the end of the year. The two principal
objectives of the drilling programme were to complete the deeper holes on
Kearney, in order to gain a more accurate picture of the zone of mineralisation
for the purpose of the underground mine plan; also, to extend the strike of
Joshua to the north and the south, and begin to target deeper sections of the
vein. During the year 11,991 metres were drilled with 35 holes targeting the
Joshua vein, 14 holes on the Kearney veins and 4 holes on the Kerr veins.
Drilling on Kearney was mainly at depth from off-site locations. Several cores
yielded more than one mineralised section. The vein appears to pinch and swell
at depth, similar to what has been seen in the open pit. Vein intersects ranged
in width from 0.2 m to 7.6 m. A number of shorter infill holes targeting Kearney
were also drilled from west to east with variable success. 


Land to the west of the current Joshua vein exposure was acquired early in the
first quarter. This facilitated continued drilling which initially targeted the
north and central sections of the Joshua vein. The strike length now extends a
total of 208 metres beyond the previously known "RioFinex" limit and the proven
depth of mineralisation within this northern section has increased by 40 m to a
vertical depth of 115 m. Significant results were also achieved for central and
southern Joshua which have improved the understanding of the structure and
geometry of the vein in these areas. In the central region, the vein was
intersected at a vertical depth of 160.6 m, yielding a 4.5 m wide mineralised
section grading 8.4 g/t Au. Drilling and field observations strengthened the
view of a westerly dipping vein with high grade mineralisation at depth. In the
south, six holes revealed two or more vein intersects, some of these were narrow
stringers, and others point towards the presence of a more pervasive secondary
structure. A particularly wide and high grade zone was intersected and section
drawings indicate that the vein steepens in this area, dipping 85 degrees
towards the east. 


A desk based study was completed later in the year in order to prioritise new
targets within the mine site. Some exploratory targets were drilled to test IP
anomalies and auriferous overburden results previously reported around the
current stockpile area. A narrow vein was picked up in one drill hole measuring
3.9 g/t Au. Mapping of the Kerr and McCombs veins showed that they fan out
towards the north, indicating that there could be a central source towards the
south of the property. Five holes were drilled in the Kerr, eastern lagoon and
western lagoon regions during the second half of the year with encouraging
results from one hole on the western side of the Kerr pit. This hole intersected
mineralisation at a vertical depth of 108 m.


Channel sampling was carried out on the northern extension to Kearney in January
and September. The Kerr veins were also subject to channel sampling in 2012.
Excavations during March revealed that one of the veins sampled in 2011 was
widening with depth, and becoming more continuous along strike. Subsequent
excavations have increased the strike of this vein to 100 m, although it appears
to narrow towards the north.


Assay results released to date from both the drilling and channel sampling
programmes have been encouraging with significant gold intersections identified.
Particularly positive were the assays from the ten drill holes on Joshua
released in January 2013 with thirteen significant mineral intersects. Drilling
has continued into 2013 using the company's own core drilling rig manned by
in-house drillers. A further 1600 metres are planned in the short term,
extending the programme to 18,000 metres following up the recently reported gold
intersects on the Joshua vein.


In March 2012 the Company appointed ACA Howe International Ltd (Howe UK) to
prepare an Interim Resource for the Omagh Gold Project to Canadian National
Instrument NI 43-101 standard. During the third quarter Galantas reported that
it had received initial data from ACA Howe related to the preparation of an NI
43-101 compliant mineral resource estimate and a Preliminary Economic Assessment
(see press release dated July 3, 2012).This report, which was based on drilling
results and analyses received to June 8, 2012, identified all resources
discovered at that date. The Company subsequently filed a complete Technical
Report on SEDAR in August 2012. A further updated report is expected to be
prepared during the first half of 2013 when the remaining results of the
extended 18,000 metre drilling programme are received. This updated report will
incorporate all drilling results and analyses received subsequent to June 2012.


Permitting

Discussions with the regulatory authorities in Northern Ireland continued during
the year. The underground mine plan and Environmental Impact Assessment were
completed during the first half of 2012 and were then submitted to the Planning
Services for planning consent. Discussions with the regulatory authorities
continued during the second half of 2012 with regards to the underground mine
plan and accompanying Environmental Statement. During the third quarter planning
consent was received from the Planning Services for the construction of a lower
portal structure and truncated adit for underground mining on the Kearney vein. 


Roland Phelps, President & CEO, Galantas Gold Corporation, commented, "Solid
results from the drilling program are supporting continued investment in the
Omagh Mine. The focus of operations in 2013 is expected to be directed towards
achieving all that is necessary to establish an underground operation. Working
with local representatives and the Planning Service, we expect to satisfy any
issues arising from the upcoming planning application."


The detailed results and Management Discussion and Analysis (MD&A) are available
on www.sedar.com and www.galantas.com and the highlights in this release should
be read in conjunction with the detailed results and MD&A. The MD&A provides an
analysis of comparisons with previous periods, trends affecting the business and
risk factors. Some of the production and metal figures are provisional and
subject to averaging or umpiring provisions under the concentrate off-take
contract with Xstrata Corporation detailed in a press release dated 3rd October
2007.


Qualified Person 

The financial components of this disclosure has been reviewed by Leo O'
Shaughnessy (Chief Financial Officer) and the production, exploration and
permitting components by Roland Phelps (President & CEO), qualified persons
under the meaning of NI. 43-101. The information is based upon local production
and financial data prepared under their supervision.


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains
forward-looking statements within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and applicable Canadian securities
laws, including revenues and cost estimates, for the Omagh Gold project.
Forward-looking statements are based on estimates and assumptions made by
Galantas in light of its experience and perception of historical trends, current
conditions and expected future developments, as well as other factors that
Galantas believes are appropriate in the circumstances. Many factors could cause
Galantas' actual results, the performance or achievements to differ materially
from those expressed or implied by the forward looking statements or strategy,
including: gold price volatility; discrepancies between actual and estimated
production, actual and estimated metallurgical recoveries and throughputs;
mining operational risk, geological uncertainties; regulatory restrictions,
including environmental regulatory restrictions and liability; risks of
sovereign involvement; speculative nature of gold exploration; dilution;
competition; loss of or availability of key employees; additional funding
requirements; uncertainties regarding planning and other permitting issues; and
defective title to mineral claims or property. These factors and others that
could affect Galantas's forward-looking statements are discussed in greater
detail in the section entitled "Risk Factors" in Galantas' Management Discussion
& Analysis of the financial statements of Galantas and elsewhere in documents
filed from time to time with the Canadian provincial securities regulators and
other regulatory authorities. These factors should be considered carefully, and
persons reviewing this press release should not place undue reliance on
forward-looking statements. Galantas has no intention and undertakes no
obligation to update or revise any forward-looking statements in this press
release, except as required by law. 


Galantas Gold Corporation Issued and Outstanding Shares total 235,650,055.

FOR FURTHER INFORMATION PLEASE CONTACT: 
Galantas Gold Corporation
Jack Gunter P.Eng
Chairman
+44 (0) 2882 241100


Galantas Gold Corporation
Roland Phelps C.Eng
President & CEO
+44 (0) 2882 241100
info@galantas.com
www.galantas.com


Charles Stanley Securities (AIM Nomad & Broker)
Mark Taylor
+44 (0)20 7149 6000


Investor Relations Consultant
Courtenay Heading (Maclir Consulting Ltd)
(UK) +44 (0) 7624 424 455
c.heading@Galantas.com

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