Lake Shore Gold Corp. (TSX: LSG)(NYSE MKT: LSG) ("Lake Shore Gold" or the "Company") today announced financial and operating results for the full-year and fourth quarter 2014. Full details of the results are provided in the Company's Consolidated Financial Statements and Management's Discussion & Analysis, which are available on the Company's website at www.lsgold.com and on SEDAR at www.sedar.com.

Key highlights of the 2014 results include:

--  Record production of 185,600 ounces, 38% increase from 2013
    --  2014 target: 160,000 to 180,000 ounces
--  23% improvement in cash operating cost(1) per ounce sold to US$592
    --  2014 target: US$675 to US$775
--  23% improvement in all-in sustaining cost(2) per ounce sold to US$872
    (based on production costs(3) of $120.3 million)
    --  2014 target: US$950 to US$1,050
--  $44.7 million of debt repayments
    --  2014 target: $20.0 to $25.0 million
--  29% increase in ore reserves
    --  2014 target: replace reserves mined in 2014

Cash and bullion(4) at December 31, 2014 totaled $61.5 million, an increase of $27.5 million or 81% from $34.0 million at December 31, 2013. As at March 25, 2015, the Company's cash and bullion was approximately $75.0 million.

Tony Makuch, President and CEO of Lake Shore Gold, commented: "We had a record year in 2014 with production, cash operating costs, all-in sustaining costs and total production costs all beating our targets for the year. We also grew our cash position by over 80% and paid off most of our senior secured debt. During the fourth quarter, we achieved a major milestone, reaching a half million ounces of total gold production from our Timmins operations. We finished the year strong, with both cash operating costs and all-in sustaining costs during the fourth quarter continuing to beat our full-year target ranges.

"Turning to 2015, we have continued to generate strong operating results, increase our cash and reduce debt during the first quarter. We also recently announced a 29% increase in our reserves, adding to mine life at both Timmins West and Bell Creek. At the 144 Gap Zone, we have made additional progress with exploration drilling, tripling the minimum strike length of the Zone and identifying a sizable high-grade core. We now have seven drills working at the 144 Gap and have advanced our exploration drift from Thunder Creek over 200 metres. We plan on having considerable news flow about the 144 Gap discovery throughout 2015, and are planning to establish a first resource for the end of 2015, to be released in the first quarter of 2016."

For the fourth quarter of 2014, production totaled 43,200 ounces, cash operating costs averaged US$597 per ounce sold, all-in sustaining costs averaged US$915 per ounce sold and total production costs were $28.1 million. Total debt repayments during the quarter were $23.7 million, including a payment of $20.0 million to fully repay the Company's standby line of credit ("Standby Line") on December 31, 2014.

Net earnings in 2014 totaled $23.6 million or $0.06 per common share, which compared to net loss of $233.5 million or $0.56 per common share in 2013. The net loss in 2013 largely related to an impairment charge of $225.0 million. Adjusted net earnings(5), which exclude impairment charges, other income/losses and significant non-cash, non-recurring items, totaled $28.6 million in 2014, or $0.07 per common share, compared to an adjusted net loss of $3.6 million or $0.01 per common share in 2013.

During the fourth quarter of 2014, the Company reported a net loss of $1.5 million or $0.00 per common share, which compared to a net loss of $225.7 million or $0.54 per common share in the fourth quarter of 2013 (reflecting the $225.0 million impairment charge). The net loss in the fourth quarter of 2014 included a $3.6 million expense from the write off of unamortized debt transaction costs and fees related to the early repayment of the Company's Standby Line. Adjusted net earnings in the fourth quarter of 2014 totaled $2.5 million or $0.01 per common share compared to adjusted net earnings of $2.3 million or $0.01 per common share in the fourth quarter of 2013.

Outlook

In 2015, the Company is targeting gold production of 170,000 - 180,000 ounces with estimated cash operating costs per ounce sold in the range of US$650 to US$700, all-in sustaining costs per ounce sold between US$950 and US$1,000 and total production costs of $125.0 million. The 2015 targets for production and units costs are similar to the target ranges established a year earlier for 2014.

The Company is well financed to meet its operating, capital investment and debt repayment requirements during 2015, including fully repaying its senior secured debt by the end of May. In addition, based on its 2015 business plan and current market conditions, the Company is positioned to generate significant free cash flow during the year. The Company's cash and bullion increased from $61.5 million at December 31, 2014 to approximately $75.0 million at March 25, 2015.

Additionally in 2015, the Company is targeting to replace reserves mined in the year, and advance the 144 Gap discovery. To achieve these targets, the Company is planning over 200,000 metres of drilling in 2015, including 120,000 metres of drilling at the 144 Gap Zone. The work program at 144 Gap includes $18.0 million of exploration expenditures and will involve approximately 90,000 metres of surface drilling, 30,000 metres of underground drilling and development to drive an exploration drift from Thunder Creek to establish an underground drill platform. The drift is scheduled for completion during the third quarter of 2015. The Company's goal is to establish a first resource at the 144 Gap Zone for December 31, 2015, which will be released as part of the next resource update early in 2016.

The Company's Outlook section contains forward-looking information within the meaning of certain securities laws. The Outlook section, also included in the Company's MD&A, represents the Company's guidance and forms the basis for most of the forward-looking information disclosed elsewhere in these documents and in other areas such as other press releases, newsletters, fact sheets and the Company's website. Readers are directed to the Forward-Looking Statements advisory at the end of this press release for cautionary language relating to forward-looking information.

Consolidated Financial Information
                                         Quarter ended           Year ended
                                          December 31,         December 31,
                                       2014       2013       2014      2013
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(in $'000, except the per share
 amounts)
Revenue                           $  56,080  $  65,814  $ 256,144 $ 192,647
Production costs                  $  28,076  $  31,952  $ 120,303 $ 107,491
Earnings (loss) from mine
 operations                       $  11,889  $(213,260) $  64,112 $(200,049)
Earnings (loss) from operations
 and associates                   $   5,114  $(218,577) $  45,567 $(219,624)
Earnings (loss) from continuing
 operations(i)                    $  (1,500) $(225,693) $  23,614 $(229,167)
Net earnings (loss)(i)            $  (1,500) $(225,693) $  23,614 $(233,469)
Basic net income (loss) per share
 from continuing operations       $   (0.00) $   (0.54) $    0.06 $   (0.55)
Basic net income (loss) per share $   (0.00) $   (0.54) $    0.06 $   (0.56)
Cash flows from continuing
 operating activities             $  21,736  $  38,112  $ 111,256 $  70,647
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(i) Net loss in fourth quarter 2014 included $3.6 million expense from write
off of unamortized debt transaction costs and fees related to early
repayment of Standby Line
Key Performance Drivers
                                      Quarter ended              Year ended
                                       December 31,            December 31,
                                   2014        2013        2014        2013
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Tonnes milled                   331,500     321,800   1,245,900     952,700
Grade (gpt)                         4.2         5.2         4.8         4.6
Average mill recoveries            96.7%       96.3%       96.6%       95.8%
Ounces produced                  43,200      51,700     185,600     134,600
Ounces poured                    42,400      51,400     186,500     129,600
Ounces sold                      41,200      49,650     183,300     135,600
Average price (US$/oz)       $    1,200  $    1,261  $    1,269  $    1,377
Average price ($/oz)         $    1,360  $    1,328  $    1,398  $    1,422
Cash operating costs
 (US$/oz)                    $      597  $      609  $      592  $      766
Cash operating costs ($/oz)  $      679  $      640  $      654  $      789
All - in sustaining costs
 (US$/oz)                    $      915  $      849  $      872  $    1,139
All - in sustaining costs
 ($/oz)                      $    1,040  $      891  $      963  $    1,174
Cash earnings from mine
 operations ($000s)          $   28,117  $   34,089  $  136,249  $   85,686
Adjusted net earnings (loss)
 ($000s)                     $    2,493  $    2,310  $   28,570  $   (3,593)
Adjusted net earnings (loss)
 per share ($/share)         $     0.01  $     0.01  $     0.07  $    (0.01)
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Conference Call & Webcast

Lake Shore Gold will also host a conference call and webcast on Thursday, March 26, 2015 at 2:30 pm EST to discuss the Company's full-year and fourth quarter 2014 financial and operating results (see call-in numbers that follow). The call will also be webcast and available on the Company's website.

Conference & Re-dial ID: 5948273

Participant call-in: 647-788-4919 or 877-291-4570 (North American toll free number)

Replay number: 416-621-4642 or 800-585-8367 (North American toll free number)

Available until: 11:59 pm (April 2, 2015)

Qualified Person

Scientific and technical information contained in this press release related to mine engineering and production has been reviewed and approved by Natasha Vaz, P.Eng., Vice-President, Technical Services, who is an employee of Lake Shore Gold Corp., and a "qualified person" as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

Scientific and technical information related to resources, exploration drilling and all matters involving mine production geology contained in this press release, or source material for this press release, was reviewed and approved by Eric Kallio, P.Geo., Senior Vice-President, Exploration. Mr. Kallio is an employee of Lake Shore Gold Corp., and is a "qualified person" as defined by NI 43-101.