“All of our mines delivered solid operational results, reflective of the skills and dedication of all of our fellow employees who raise the quality of our performance each year.”

Letter to Our Shareholders

Fellow shareholders,

Despite challenging market conditions, I am very pleased to report that 2014 has been another successful year for Eldorado Gold.

Eldorado achieved its highest-ever gold production of close to 800,000 ounces at industry-leading cash operating costs. All of our mines delivered solid operational results, reflective of the skills and dedication of all of our fellow employees who raise the quality of our performance each year. We made significant progress at our two key development projects Skouries and Olympias in Greece. With approximately $875 million in total liquidity at year end, our balance sheet remains one of the strongest in the industry, allowing us to internally fund our robust growth pipeline.


Operational Highlights

It was a strong year for our operations, with all of our mines delivering a consistently solid performance and meeting or exceeding their guidance for 2014. Gold production increased 9% to 789,224 ounces (2013 –721,201 ounces) and operating cash costs remained virtually flat at $500 per ounce (2013 –$494 per ounce) and with all in sustaining cash costs of $779 per ounce for the year. Our costs remained within the lower quartile of the industry average.

In Turkey, Kişladağ and Efemçukuru delivered reliably with cash operating costs coming in below guidance. Our Chinese mines had very strong years with production about 10% above guidance across the board. Jinfeng and Tanjianshan performed particularly well, with cash costs some 12% and 14% below guidance respectively. These results show the disciplined approach in which our teams operate and the pride they take in delivering to plan.


Building Value in China

Over the past year, we evaluated various options to maximise value from our Chinese assets. With our Eastern Dragon project, we entered into a joint venture with CDH Investments, whereby CDH invested $40 million for a 20% partnership interest. Construction is expected to resume at Eastern Dragon this upcoming summer, with production expected late in the year. We also announced that we are evaluating a potential listing of our Chinese assets on the Hong Kong Stock Exchange. We would complete the permitting on Eastern Dragon before any listing and timing will be predicated on suitable equity conditions, along with other considerations.


Our Future Growth

Greece, in a period of evolving political, economic and social change, remains a priority for us and our future growth. In 2014, we made excellent progress at Skouries. At year end, all mills were set in place and underground development was well under way with over 500 metres of the decline complete. By the latter part of 2015, we will have peak construction crews on site of about 1,300–1,400 people and we are on schedule to commence production towards the end of 2016. At Olympias we continued with tailings treatment and surface rehabilitation while moving ahead with Phase II development and Phase III planning. Our operations in Greece now employ over 2,000 people directly, and we estimate that there are over 3,000 additional people employed indirectly as a result of our investment in the country. Once in full production, Olympias and Skouries will be very strong cash generators for the Company and significant contributors to the local society and Greek economy.

At Certej in Romania, we will complete a feasibility study by mid 2015 and we expect to spend approximately $25 million in the year ahead on land acquisition, the feasibility study and site development costs.

At Kişladağ in Turkey, we received a positive Environmental Assessment decision on our planned Phase IV mine expansion, which allows for an expanded production rate of 20 million tonnes of crushed ore. However, due to capital commitments at Skouries and Olympias, we have opted to defer this expansion project until 2017.


Solid Financial Results

We ended the year with liquidity of approximately $875 million, including more than $500 million in cash and the remainder in unused lines of credit. This places us in an excellent position to build out our mines and invest in our business.

In a year that saw the S&P/TSX Global Gold Index decrease almost 11%, Eldorado’s share performance again separated us from our peers, with a share price appreciation of 13% over the year.


Safe, Accountable and Credible

Our teams worked collaboratively on strengthening our safety culture in 2014. Their dedication helped us achieve record safety performance and finish another year with no environmental incidents.

We continue to put our stated values of acting with respect for our people and our neighbours into practice. Our 20-year history of successfully operating in Brazil and Turkey is a testament to how we manage our relationships in those countries with integrity and transparency. We invest time and money not only in our operations but also in the communities where we operate, building opportunities for individuals, communities and governments.


Our Outlook

Looking at the year ahead, we expect to produce between 640,000–700,000 ounces of gold at an average cash cost ranging between $570–$615 per ounce, again in the lowest quartile of an industry which is experiencing a constant increase in operating costs.

Every year our people work hard to maintain Eldorado’s position as an industry-leading producer. I would like to sincerely thank our teams for their collaboration, effort and dedication in 2014. They are integral to this Company’s success, and with their skills, ideas and passion, we will continue to build a quality business that delivers value for all of our stakeholders.

Paul Wright
CEO, Eldorado Gold Corporation

“Every year our people work hard to maintain Eldorado’s position as an industry-leading producer. I would like to sincerely thank our teams for their collaboration, effort and dedication in 2014.”