HispanicBusiness

FINANCIAL TABLES FOLLOW.

Non-GAAP Measures

Cash costs per ounce of gold represent non-U.S. Generally Accepted Accounting Principles ("GAAP") measurements that the Company believes provide management and investors an indication of net cash flow. Management also uses this measurement for the comparative monitoring of performance of mining operations period-to-period from a cash flow perspective. Cash cost per ounce is a measure developed by gold companies in an effort to provide a comparable standard; however, there can be no assurance that our reporting of this non-GAAP measure is similar to that reported by other mining companies. Cost of sales and other direct production costs was the most comparable financial measures calculated in accordance with GAAP to total cash costs.

                          Gryphon Gold Corporation                     Cash Cost Per Ounce Reconciliation                                 (Unaudited)                          (Stated in U.S. dollars)                                    Three months ended     Nine months ended                                              December 31, 2012Cost of sales                    $           2,141,627 $          11,576,597Impairment on inventory                              -             (323,570)Royalties                                    (165,574)             (659,272)Inventory change                               515,994             (214,198)----------------------------------------------------------------------------Production cash costs            $           2,492,047 $          10,379,557Gold equivalent ounces produced                  1,929                 7,709----------------------------------------------------------------------------Cash cost per ounce              $               1,292 $               1,346--------------------------------------------------------------------------------------------------------------------------------------------------------                          Gryphon Gold Corporation                         Consolidated Balance Sheets                                 (Unaudited)                          (Stated in U.S. dollars)                                          December 31, 2012   March 31, 2012                                          ----------------------------------ASSETSCurrent assets:  Cash                                     $        576,038 $        602,343  Accounts receivable                               107,777          358,005  Prepaid expenses                                  715,377          171,515  Inventories                                     6,113,735        6,363,016  Deferred debt issue costs                         477,546          312,549                                          ----------------------------------                                                  7,990,473        7,807,428  Property, plant and equipment, net             31,477,227       19,565,395  Reclamation bonds and deposits                  3,741,418        2,839,559                                          ----------------------------------                                           $     43,209,118 $     30,212,382                                          ----------------------------------                                          ----------------------------------LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilities:  Current portion of long-term debt        $      5,243,004 $        583,458  Accounts payable and accrued liabilities        4,884,010        5,004,298  Note payable                                            -        1,376,479                                          ----------------------------------                                                 10,127,014        6,964,235  Long-term debt, net of discount and   current portion                               20,611,574       10,198,611  Asset retirement obligation                     3,814,005        1,675,877  Warrant derivative liabilities                    375,214          137,291                                          ----------------------------------                                                 34,927,807       18,976,014                                          ----------------------------------Stockholders' equity:  Common stock                                      194,644          194,103  Additional paid in capital                     54,355,144       54,114,438  Accumulated deficit                          (46,268,477)     (43,072,173)                                          ----------------------------------                                                  8,281,311       11,236,368                                          ----------------------------------                                           $     43,209,118 $     30,212,382                                          ----------------------------------                                          ----------------------------------                          Gryphon Gold Corporation                    Consolidated Statement of Operations                                 (Unaudited)                          (Stated in U.S. dollars)                            Three months ended         Nine months ended                               December 31,              December 31,                        ----------------------------------------------------                                 2012         2011         2012         2011                        ----------------------------------------------------Net Sales                $  3,215,242 $    931,794 $ 12,608,898 $    931,794Cost of sales and other direct production costs    3,547,914      930,399   11,576,597      930,219Depreciation                  264,648       41,498    1,022,683       41,678                        ----------------------------------------------------Gross profit (loss)         (597,320)     (40,103)        9,618     (40,103)                        ----------------------------------------------------Operating expenses: Exploration (refund)          15,111     (26,394)       43,313       68,860 Salaries and consulting  fees                        231,246      364,297      757,124      836,465 General and  administrative              180,705      152,554      552,261      527,164 Legal and audit              108,438       62,202      483,449      203,202 Travel and  accommodation                26,300       66,328       91,864      159,589 Depreciation                   7,143       17,714       20,616       35,176 Write down of mining  property                          -            -       11,003            - Loss on disposal of  equipment                     3,347            -        2,917            - Asset retirement  obligation accretion         81,095       10,284      189,817       27,280                        ----------------------------------------------------                              653,385      646,985    2,152,363    1,857,736                        ----------------------------------------------------Loss from operations      (1,250,705)    (687,088)  (2,142,745)  (1,897,839)Other (income) expense: Loss (gain) on foreign  exchange                    (1,146)       94,653       49,718      189,449 Gain on warrant  derivative liability        (9,288)            -    (801,643)            - Interest income                (122)      (7,926)      (3,773)     (11,153) Interest expense, net  of capitalized  interest                    512,428      381,212    1,809,257      466,814                        ----------------------------------------------------Net loss                 $(1,752,577) $(1,155,027) $(3,196,304) $(2,542,949)                        ----------------------------------------------------                        ----------------------------------------------------Basic and diluted net income (loss) per share $     (0.01) $     (0.01) $     (0.02) $     (0.01)                        ----------------------------------------------------                        ----------------------------------------------------Weighted shares used in calculating basic and diluted net income (loss) per share         194,644,091  193,992,040  194,644,091  177,175,447                        ----------------------------------------------------                        ----------------------------------------------------                          Gryphon Gold Corporation                    Consolidated Statements of Cash Flows                                 (Unaudited)                          (Stated in U.S. dollars)                                                  Nine months ended                                                     December 31,                                         -----------------------------------                                                      2012              2011                                         ----------------- -----------------Operating activities:Net cash used by operating activities     $    (3,583,513)  $    (4,790,874)Investing activities:  Reclamation bonds purchased                    (901,859)       (2,033,500)  Purchase of property, plant and   equipment                                   (3,460,450)       (8,732,729)  Proceeds from sale of equipment                    1,000                 -  Mineral property expenditures                          -         (248,203)  Option payment to amend and reduce   royalty                                               -         (175,000)  Proceeds from note receivable                          -             2,975                                         ----------------- -----------------Net cash used in investing activities          (4,361,309)      (11,186,457)                                         ----------------- -----------------Financing activities:  Repayment of borrowings                      (2,271,761)          (46,693)  Proceeds from borrowings, net                 10,290,095         7,480,676  Shares and warrants issued for cash                    -        11,134,317  Public offering costs                                  -       (1,198,621)  Debt and share issue costs                     (100,535)         (829,587)                                         ----------------- -----------------Net cash provided in financing activities        7,917,799        16,540,092                                         ----------------- -----------------Effect of foreign exchange on cash                     718          (20,141)Net increase (decrease) in cash                   (26,305)           542,620Cash, beginning of year                            602,343           837,457                                         ----------------- -----------------Cash, end of period                       $        576,038  $      1,380,077                                         ----------------- -----------------                                         ----------------- -----------------Reconciliation of net loss to net cash used by operating activities:Net loss                                  $    (3,196,304)  $    (2,542,949)Adjustments to reconcile net loss to net cash used by operating activities:  Interest expense paid with debt                  149,229                 -  Depreciation                                   1,043,299            76,854  Asset retirement obligation accretion            189,817            27,280  Loss on disposal of equipment                      2,917                 -  Stock compensation expense, net of tax           229,997           181,041  Common stock issued for services   provided                                         11,250                 -  Amortization of debt offering costs              515,538           199,947  Amortization of notes payable discount           465,314           199,877  Unrealized gain (loss) on foreign   exchange                                          (718)            20,141  Impairment of inventory                          323,570                 -  Write down of mining property                     11,003                 -  Gain on warrant derivative liability           (801,643)                 -Other changes in operating assets and liabilities:  Accounts receivable                             (73,342)         (497,977)  Accounts payable and accrued   liabilities                                 (2,056,597)         1,239,602  Inventories                                      147,019       (3,537,564)  Prepaid expenses                               (543,862)         (157,126)                                         ----------------- -----------------                                          $    (3,583,513)  $    (4,790,874)                                         ----------------- -----------------                                         ----------------- -----------------