Klondex Mines Ltd.

Klondex Mines Ltd. is focusing on the exploration, development and production of its two high-quality gold and silver projects in the mining-friendly jurisdiction of north-central Nevada. The 1200 tpd milling facility is processing mineralized materials from the Midas mine and the Fire Creek project. Midas is fully permitted and has been in operation since 1998. Fire Creek is located ~100 miles south of Midas and is operating an ongoing bulk sampling program that began in 2013. All major infrastructure is in place at Fire Creek.

Expert Comments:

Barry Allan, Mackie Research Capital (1/21/15)
"Klondex Mines Ltd. released Q4/14 operating results, with production of 30.5 Koz Au eq. . .bringing total production for the year to 107.9 Koz vs. original guidance of 70–85 Koz Au eq provided in June and revised upwards to 95 Koz Au eq in October. Looking ahead to 2015, initial guidance has been set at 120–125 Koz, which we believe is conservative given that the company will benefit from a full year of production at Midas. . .and the full operating permit for Fire Creek which is expected in H2/15. . .with Klondex now generating free cash flow, we expect the balance sheet to continue to strengthen."

Derek Macpherson, M Partners (1/20/15)
"Klondex Mines Ltd. released Q4/14 production results that we would characterize as positive as it produced 30.5 Koz Au eq, 45% ahead of our estimate of 21.1 Koz. . .the significantly higher-than-expected grades have resulted in adjustments to our Q4/14 financial estimates, particularly taking into account that Klondex sold 4 Koz more gold (26.3 Koz sold versus 22.3 Koz produced) than was produced during the quarter."

Philip Ker, PI Financial (1/20/15)
"Klondex Mines Ltd. announced in-line production from its Nevada operations in Q4/14. . .22,262 oz gold and 517,761 oz silver versus our estimate of 23,628 oz and 345,920 oz, respectively. This led to annual production of 86,239 oz gold and 1,365,586 oz silver during the company's inaugural year as a producer. Klondex continues to deliver on all fronts. . .we continue to expect Klondex to demonstrate cost reductions at both Fire Creek and Midas, with both undergoing significant capital development and exploration programs in the near term. . .we are raising our target price from $2.55 per share to $2.65 per share."

Ben Kramer-Miller, Seeking Alpha (1/20/15)
"Klondex Mines Ltd. continues to be one of the best gold miners given its valuation and level of risk, making it a Buy on any weakness. . .the company just reported an excellent first year of production. For the full year, it recovered 108 Koz gold at an ore grade of 0.51 oz/t, with silver production at 8.3 oz/t."

Barry Allan, Mackie Research Capital (1/19/15)
"Klondex Mines Ltd.'s current operations are exceptionally high-grade, and while the company will not benefit from the CA$/US$ exchange rate, the underlying asset base is of very high quality, and in a well-known mining district. Klondex is debt free."

M Partners (1/13/15)
"Our favorite gold name remains Klondex Mines Ltd. as the company's high grades provide above average margins, allowing it to generate meaningful free cash flow in the current gold price environment. . .we estimate that Klondex is likely to generate positive free cash flow (from operations plus investing) of $39.1M in 2015."

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Investing Highlights
 
High Grades with Low Cost Production
 
Core Assets in Nevada
 
Depth of Management Experience
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