Apollo Gold Reports Third Quarter 2005 Results

On May 30, 2005, the Company adopted a plan to dispose of itsNevada assets (the "Nevada Assets"), which consist of the FloridaCanyon Mine, Standard Mine and four Nevada exploration properties. TheNevada Assets are classified as "assets held for sale" and have beenseparated from the other assets within the Consolidated BalanceSheets. Also, the Nevada Assets only appear as a single line withinthe Consolidated Statements of Operations called "Loss fromdiscontinued operations."

The Company's total operating losses for the three and nine monthsended September 30, 2005, are as follows:
Three months ended Nine months ended
------------------- -----------------
September 30, September 30,
------------------- -----------------
2005 2004 2005 2004
$ 000's $ 000's $ 000's $ 000's
---------- -------- -------- --------

Loss from continuing operations (3,614) (8,476) (12,006) (22,745)
Loss from discontinued
operations (3,599) (2,753) (5,954) (2,521)
---------- -------- -------- --------
Net loss for the period (7,213) (11,229) (17,960) (25,266)

Loss from Continuing Operations -- The Company had a net loss fromcontinuing operations of $3.6 million, or $0.04 per share, for thethree months ended September 30, 2005, compared to a net loss of $8.5million, or $0.11 per share, for the same period 2004. The net lossfrom continuing operations for the nine months ended September 30,2005, was $12.0 million, or $0.12 per share, compared to a net loss of$22.7 million, or $0.29 per share, for the same period 2004. The netloss from continuing operations includes the Montana Tunnels mine inMontana.

Loss from Discontinued operations -- In the three months endedSeptember 30, 2005, the Company recorded an impairment of $3.9 millionrelated to the sale of the Nevada Assets. This component when added tothe results from the discontinued operations means that the total lossfor discontinued operations for the three months ended September 30,2005, was $3.6 million, or $0.03 per share, as compared to $2.8million, or $0.3 per share, for the three months ended September 30,2004.

Nevada Asset Sales -- On October 17, 2005, the Company executed astock purchase agreement pursuant to which the Company has agreed tosell the Nevada Assets to Jipangu Inc., a Delaware corporation andwholly owned subsidiary of Jipangu International Inc., a Japanesecorporation, for $14 million.

Black Fox Project -- The Company completed an additional 30underground diamond drill holes at its Black Fox project during thethird quarter 2005 bringing the total number of underground holes to335 as at September 30, 2005, and the total number of underground andsurface drill holes completed to 784. The Company expects to completethe current drilling program in November 2005 and the Company hasbegun work to update its Black Fox ore reserves which will bepublished during the first quarter 2006.

Huizopa Project -- Work continued on the Huizopa explorationproject in Mexico, including: geological mapping, sampling, andgeophysical studies.

Continuing Operations -- In the three months ended September 30,2005, Montana Tunnels produced 14,104 ounces of gold at a total cashcost of $513 per ounce compared to 4,967 ounces at a total cash costof $1,465 per ounce in the same period 2004. For the nine months endedSeptember 30, 2005, gold production increased 80%, to 39,073 ounces ata total cash cost of $537 per ounce compared to production in the sameperiod 2004 of 21,653 ounces at a total cash cost of $1,057 per ounce.

Discontinued Operations -- Florida Canyon gold production fromcontinued leaching decreased 58% to 6,169 ounces at a total cash costof $409 per ounce for the three months ended September 30, 2005, from14,820 ounces of gold at a total cash cost of $406 per ounce for thethree months ended September 30, 2004, primarily due to cessation ofmining on March 1, 2005. Florida Canyon gold production decreased by55% to 24,765 ounces at a total cash cost of $380 per ounce for thenine months ended September 30, 2005, from 55,649 ounces of gold at atotal cash cost of $354 per ounce for the nine months ended September30, 2004, primarily due to the cessation of mining on March 1, 2005.

Standard Mine, which commenced commercial production on June 1,2005, produced 8,432 ounces of gold during the three months endedSeptember 30, 2005, at a total cash cost of $387 per ounce. StandardMine produced 11,241 ounces of gold during between June and September2005 at a total cash cost of $380 per ounce.

Consolidated Financial Results Summary
(All Dollars in U.S., 000's unless otherwise stated)

Three months ended Nine months ended
------------------------- ------------------------
September 30, September 30,
------------------------- ------------------------
2005 2004 2005 2004
(1)(2)
Loss from
continuing
operations ($3,614) ($8,476) ($12,006) ($22,745)
(Loss) income from
discontinued
operations ($3,599) ($2,753) ($5,954) ($2,521)
------------- ----------- ------------ -----------
Net loss ($7,213) ($11,229) ($17,960) ($25,266)

Basic and diluted
net loss per share
from (US$):
Continuing
operations ($0.04) ($0.11) ($0.12) ($0.29)
Discontinued
operations ($0.03) ($0.03) ($0.06) ($0.03)
------------- ----------- ------------ -----------
($0.07) ($0.14) ($0.18) ($0.32)




Basic and undiluted
shares (weighted
average)
outstanding 106,556,451 79,617,391 100,106,695 77,924,423

Gold ounces sold
(continuing
operations) 14,104 4,967 39,073 21,653
Total cash costs
per ounce (US$/oz)
(3) $513 $1,465 $537 $1,057

Average realized
gold price
(US$/oz) $455 $411 $438 $398
Gold spot price per
ounce (US$/oz) (4) $439 $401 $431 $401

(1) Income numbers have been restated to reflect the change in
accounting policy for deferred stripping implemented in the second
quarter 2005.

(2) Certain of the comparative figures have been reclassified to
conform to the current period presentation. In particular, the
results of operations of the Nevada Assets for the three and nine
months ended September 30, 2005, have been classified as
discontinued operations. Also, the production statistics reflect
Montana Tunnels only.

(3) The term "total cash cost" is a non-GAAP financial measure and is
used on a per ounce of gold sold basis. Total cash cost is
equivalent to direct operating cost as found on the Consolidated
Statements of Operations and includes by-product credits for
payable silver, lead, and zinc production. We have included total
cash cost information to provide investors with information about
the cost structure of our mining operation. This information
differs from measures of performance determined in accordance with
GAAP in Canada and in the United States and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. This measure is not
necessarily indicative of operating profit or cash flow from
operations as determined under GAAP and may not be comparable to
similarly titled measures of other companies.

(4) Average gold price as per London PM fix.

Three Months Ended September 30, 2005, Compared to the ThreeMonths Ended September 30, 2004

Montana Tunnels (continuing operations) -- For the three monthsended September 30, 2005, gold production from Montana Tunnelsincreased 184% to 14,104 ounces, zinc production increased 98% to7,400,000 lbs, and lead production increased 61% to 3,389,000 lbs from4,967 ounces of gold, 3,738,000 lbs of zinc, and 2,110,000 lbs of leadfor the three months ended September 30, 2004. Production in 2004 wassignificantly reduced due to a major stripping program and theprocessing of lower grade and below reserve grade ores.

For the three months ended September 30, 2005, total cash cost perounce of gold decreased 65% to $513 from $1,465 for the three monthsended September 30, 2004, due to higher production of metals as aresult of higher grades of ore and improved zinc and lead prices.However, the total cash cost per ounce remained above the sellingprice per ounce of gold primarily due to poor mining performance,resulting from ramp access and pit wall problems.

Revenues for the three months ended September 30, 2005, increased81% to $13.4 million from $7.4 million for the same period in 2004.Revenues from silver, zinc and lead for the three months endedSeptember 30, 2005 increased 28% to $6.9 million from $5.4 million forthe three months ended September 30, 2004. Revenue from gold sales forthe three months ended September 30, 2005, were $6.4 million (48% oftotal revenue) compared to $2.0 million (28% of the total revenue) forthe same period 2004. Revenue from zinc at $4.7 million for the threemonths ended September 30, 2005, accounted for 35% of total revenues.The average price received for gold per ounce for the three monthsended September 30, 2005, increased 11% to $455 from $411 for thethree months ended September 30, 2004. The increase in revenues is dueto increased production and higher prices of zinc and lead.

Total operating expenses, which includes direct operating costs,increased 3% to $16.3 million for the three months ended September 30,2005, from $15.8 million for the three months ended September 30,2004. Direct operating costs, which includes mining costs, processingcosts, and smelting and refining charges, increased 13% to $14.2million for the three months ended September 30, 2005, from $12.6million for the same period in 2004, although there was a decrease inmined tons of 57% to 4,217,617 tons from 9,789,823 tons, due primarilyto the lower stripping ratio required, for the three months endedSeptember 30, 2004. The mining cost per ton for the three months endedSeptember 30, 2005 was $1.54 compared to $0.66 for the three monthsended September 30, 2004. The two primary reasons for the increase inmining costs are: (i) in 2004 the majority of the material mined waswaste from the upper benches of the pit requiring shorter uphill hauldistances and therefore better efficiencies when compared to 2005,where mining was mainly from the pit bottom, and (ii) the significantincreases in the prices of mining consumables, such as diesel andtires, both of which have increased by over 100% since September 30,2004.

The following presents the key statistics for the Montana Tunnelsoperation for the three months ended September 30, 2005 and 2004,respectively:
Three months ended Three months ended
September 30 September 30
------------------ ------------------
2005 2004
------------------ ------------------
(as restated)
Tons mined....................... 4,217,617 9,789,823
Tons milled...................... 1,299,610 1,514,690
Gold grade oz/ton.............. 0.0150 0.0059
Zinc grade %................... 0.42 0.20
Strip ratio...................... 3.2:1 6.5:1
Production payable:..............
Gold ounces.................... 14,104 4,967
Silver ounces.................. 129,736 425,351
Lead pounds.................... 3,389,443 2,110,786
Zinc pounds.................... 7,401,636 3,738,427
Total cash costs per ounce....... $513 $1,465
Total production costs per ounce. $556 $1,595
Total revenue ($ millions)....... $13.4 $7.4
Capital expenditures
($ millions).................... $0.1 $1.1

Since full commercial production was recommenced at MontanaTunnels in April 2003, the mine has experienced pit wall problems andwall movement, which has in the past resulted in the Companytemporarily suspending mining. During October 2005, there wasincreased wall activity on the eastern side of the open pit above thehaul ramp. Although the pit is still accessible, the Company decidedto temporarily suspend mining on October 21, 2005, to undertake, withthe assistance of outside consultants, a technical review of pitaccess options and safety issues affecting the mine. In the meantime,the Company plans to continue milling low grade ores from stockpilematerial and is currently unable to predict the effect on itsfinancial results.

Nine Months Ended September 30, 2005, Compared to the Nine MonthsEnded September 30, 2004

Montana Tunnels (continuing operation) -- For the nine monthsended September 30, 2005, gold production from Montana Tunnelsincreased 80% to 39,073 ounces, zinc production increased 6% to19,800,000 lbs, and lead production increased 33% to 9,273,000 lbsfrom 21,653 ounces of gold, 18,753,000 lbs of zinc, and 6,978,000 lbsof lead for the nine months ended September 30, 2004.

For the nine months ended September 30, 2005, total cash cost perounce of gold from Montana Tunnels decreased 49% to $537 from $1,057for the nine months ended September 30, 2004. The improvement in cashcost per ounce is primarily due to higher production of metals as aresult of better grades of ore. However, the total cash cost per ouncestill remained above the selling price per ounce of gold primarily dueto poor mining performance, resulting primarily from ramp access andpit wall problems.

Revenues for the nine months ended September 30, 2005, increased42% to $36.3 million from $25.5 million for the same period in 2004.Revenues from silver, zinc and lead for the nine months endedSeptember 30, 2005, increased 14% to $19.3 million from $16.9 millionfor the nine months ended September 30, 2004. Revenue from gold salesfor the nine months ended September 30, 2005, were $17.0 million, (47%of total revenue) compared to $8.6 million (34% of the total revenue)for the same period 2004. Revenue from zinc at $12.3 million for thenine months ended September 30, 2005, accounted for 34% of totalrevenues. The average price received for gold per ounce for the ninemonths ended September 30, 2005, increased 9% to $435 from $398 forthe nine months ended September 30, 2004. The increase in revenues isprimarily due to increased production due to higher grades of ore andhigher prices of zinc and lead.

Total operating expenses, which includes direct operating costs,totaled approximately $47.9 million for the nine months endedSeptember 30, 2005 and 2004. Direct operating costs, which includesmining costs, processing costs and smelting and refining charges, forthe nine months ended September 30, 2005, increased 1% to $40.3million from $39.8 million for the nine months ended September 30,2004, although there was a decrease in mined tonnage of 51% to13,606,591 tons from 27,578,156 tons for the nine months endedSeptember 30, 2004. These higher than expected costs were a result ofoperational problems encountered in the mine and higher unit costs ofoperational supplies when compared to 2004. The operational problemswere weather-related problems in the second quarter 2005, resulting inproblems with access to the ramp and lower tons being mined. Thehigher unit costs of operational supplies are a result of thesignificant increase in the cost of consumables such as diesel andtires, both of which have increased by over 100% during the pasttwelve months.

The following presents the key statistics for the Montana Tunnelsoperation for the nine months ended September 30, 2005 and 2004,respectively:
Nine months ended Nine months ended
September 30, September 30,
----------------- -----------------
2005 2004
----------------- -----------------
(as restated)
Tons mined......................... 13,606,591 27,578,156
Tons milled........................ 3,965,389 3,780,791
Production:........................
Gold grade oz/ton................ 0.014 0.009
Zinc grade %..................... 0.36 0.38
Gold ounces...................... 39,073 21,653
Silver ounces.................... 421,479 769,020
Lead pounds...................... 9,273,121 6,978,014
Zinc pounds...................... 19,800,021 18,753,013
Total cash costs per ounce......... $537 $1,057
Total production costs per ounce... $586 $1,142
Total revenue ($ millions)......... $36.3 $25.5
Capital expenditures ($ millions).. $0.2 $2.2

Liquidity and Financial Resources

To date, Apollo has funded its operations primarily throughissuances of debt and equity securities. At September 30, 2005, cashand cash equivalents were $0.3 million, compared to cash and cashequivalents of $6.9 million at December 31, 2004. The decrease in cashfrom December 31, 2004, was primarily the result of operating cashoutflows of $6.7 million, investment activities of $3.3 million plus areduction of capital lease debt of $0.8 million. These outflows wereoffset by funds from proceeds on disposal of property, plant andequipment of $2.0 million and sale of common shares of $5.9 million.

Investing activities used $3.3 million of cash during the ninemonths ended September 30, 2005, compared to $13.8 million in the sameperiod 2004. Capital expenditures in the first nine months were $4.7million of which $4.4 million were for the further development of theBlack Fox project. In addition to this capital expenditure, $1.6million was invested in the restricted cash account as part of theMontana Tunnels reclamation liability.

The Company intends to deposit $10.9 million of the $14.0 millionit expects to receive in the fourth quarter from the sale of theNevada Assets as substitute collateral for its $8.73 millionconvertible debentures, which are currently secured by the NevadaAssets. Subject to certain conditions the Company could replace thisfuture cash collateral with Black Fox as security for the convertibledebentures. By the end of the second quarter of 2006, the Companyexpects it will be able to meet those conditions, resulting inadditional funds being available to the Company for furtherdevelopment of Black Fox, exploration at Huizopa and other generalcorporate purposes.

The Company believes that its current funds together with theOctober 2005 $2.5 million cash advance on the purchase price for theNevada Assets, the remaining $0.6 million the Company expects toreceive for the sale of the Nevada Assets, net of cash used as cashcollateral for the debentures, and the contemplated $3.5 millionprivate placement investment by Jipangu will be sufficient to fund itsworking capital and exploration and development expenditures for thenext twelve months. In addition, the Company may raise additionalfinancing from the sale of debt or equity securities which may includeCanadian flow-through financing to fund a portion of its explorationexpenditures at Black Fox. Exploration and development expendituresfor Huizopa and Black Fox are estimated at $1.0 million for the lastquarter of 2005. If the Company does not sell the Nevada Assets orsuccessfully generate cash flow from its mines, the Company would berequired to secure additional financing to enable it to continue as agoing concern and undertake its expenditure programs.

Forward-Looking Statements

This press release includes certain forward-looking statements asdefined in the Private Securities Litigation Reform Act of 1955 withrespect to our financial condition, results of operations, businessprospects, plans, objectives, goals, strategies, future events,capital expenditure, and exploration and development efforts. Wordssuch as "expects," "anticipates," "intends," believes," and similarexpressions identify forward looking statements. These statementsinclude comments regarding: the completion of the drilling program,publishing of reserve calculations, continued milling from stockpilematerial, completion of the sale of the Nevada Assets, use of funds,ability to substitute collateral for the convertible debentures andthe timing thereof, availability of funds, ability to fund our workingcapital and exploration and development expenditures for the nexttwelve months, estimated exploration and development expenditures.These forward looking statements are subject to numerous risks,uncertainties and assumptions including unexpected changes in businessand economic conditions; variations in ore grade, tonnes mined,crushed or milled; the results of independent Canadian NI 43-101reports; the outcome of assays and additional exploration sampling anddrilling efforts; pit slides at our mining properties, results ofcurrent and future exploration activities; weather fluctuations;timing and availability of external financing on acceptable terms;significant increases or decreases in gold, silver, or lead prices;and other factors in our Form 10-K for the year ended December 31,2004. There can be no assurance that future developments affecting theCompany will be those anticipated by management. The forecastscontained in this press release constitute management's currentestimates, as of the date of this press release, with respect to thematters covered thereby. We disclaim any obligation to updateforward-looking statements, whether as a result of new information,future events or otherwise.

CONSOLIDATED BALANCE SHEETS
(In thousands of United States Dollars)
(Unaudited)
September 30, December 31,
2005 2004
------------- -------------
(Restated -
Note 3(b))
Assets
Current
Cash and cash equivalents............... $309 $6,886
Accounts receivable..................... 3,257 2,963
Prepaids................................ 179 109
Inventories............................. 1,849 2,192
Current assets held for sale (Note 4)... 9,089 10,510
------------- -------------
Total Current Assets....................... 14,683 22,660

Property, plant and equipment.............. 39,979 37,599
Restricted certificate of deposit.......... 5,715 4,371
Deferred financing costs................... 1,145 901
Non-current assets held for sale (Note 4).. 23,074 32,104
------------- -------------
Total Assets............................ $84,596 $97,635
------------- -------------
------------- -------------
Liabilities
Current
Accounts payable........................ $6,458 $5,942
Accrued liabilities..................... 1,992 1,860
Notes payable........................... 501 789
Property and mining taxes payable....... 1,287 1,070
Current liabilities held for sale
(Note 4)............................... 3,953 8,224
------------- -------------
Total Current Liabilities.................. 14,191 17,885

Notes payable and long-term liability...... 54 423
Convertible debentures..................... 6,368 5,538
Accrued site closure costs................. 12,390 11,753
Non-current liabilities held for sale
(Note 4).................................. 15,192 14,815
------------- -------------
Total Liabilities....................... 48,195 50,414
------------- -------------

Continuing operations (Note 1)

Shareholders' Equity
Share capital (Note 5)..................... 148,079 141,795
Issuable common shares..................... 231 231
Equity component of convertible debentures. 1,809 1,815
Note warrants.............................. 781 781
Contributed surplus........................ 10,489 9,627
Deficit.................................... (124,988) (107,028)
------------- -------------
Total Shareholders' Equity.............. 36,401 47,221
------------- -------------
Total Liabilities and Shareholders'
Equity................................. $84,596 $97,635
------------- -------------
------------- -------------

The accompanying notes are an integral part of these interimconsolidated financial statements.

APOLLO GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of United States Dollars, except for share and per share
amounts)
(Unaudited)

Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
2005 2004 2005 2004
------------ ----------- ------------ -----------
(Restated - (Restated -
Notes 3(b) Notes 3(b)
and 7) and 7)
Revenue
Revenue from sale
of minerals...... $13,351 $7,393 $36,264 $25,542
------------ ----------- ------------ -----------
Operating Expenses..
Direct operating
costs............ 14,162 12,627 40,273 39,815
Depreciation and
amortization..... 672 674 2,006 1,907
General and
administrative
expenses......... 866 1,087 3,732 4,325
Stock-based
compensation..... 171 388 525 487
Accretion expense
- accrued site
closure costs.... 242 479 636 560
Exploration and
business
development...... 173 515 731 774
------------ ----------- ------------ -----------
16,286 15,770 47,903 47,868
------------ ----------- ------------ -----------
Operating (Loss).... (2,935) (8,377) (11,639) (22,326)
Other Income
(Expenses).........
Interest income... 105 10 278 261
Interest expense.. (747) (30) (1,940) (113)
(Loss) gain on
sale of property,
plant and
equipment........ (42) - 1,323 -
Foreign exchange
gain (loss) and
other............ 5 (79) (28) (567)
------------ ----------- ------------ -----------
(Loss) from
continuing
operations......... (3,614) (8,476) (12,006) (22,745)
(Loss) from
discontinued
operations
(Note 4)............ (3,599) (2,753) (5,954) (2,521)
------------ ----------- ------------ -----------
Net (loss) for the
period............. $(7,213) $(11,229) $(17,960) $(25,266)
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------
Basic and diluted
net (loss) per
share from:
Continuing
operations....... $(0.04) $(0.11) $(0.12) $(0.29)
Discontinued
operations....... (0.03) (0.03) (0.06) (0.03)
------------ ----------- ------------ -----------
$(0.07) $(0.14) $(0.18) $(0.32)
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------
Weighted average
number of shares
outstanding........ 106,556,451 79,617,391 100,106,695 77,924,423
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------

The accompanying notes are an integral part of these interimconsolidated financial statements.

APOLLO GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of United States Dollars)
(Unaudited)

Three months ended Nine months ended
September 30, September 30,
------------------ -------------------
2005 2004 2005 2004
--------- -------- --------- ---------
Operating Activities
Loss from continuing
operations for the period... $(3,614) $(8,476) $(12,006) $(22,745)
Items not affecting cash
Depreciation and
amortization.............. 672 674 2,006 1,907
Amortization of deferred
financing costs........... 80 - 239 -
Stock-based compensation... 171 388 525 487
Accretion expense - accrued
site closure costs........ 242 479 636 560
Accretion expense -
convertible debentures.... 221 - 850 -
Loss (gain) on sale of
property, plant and
equipment................. 42 - (1,323) -
Net change in non-cash
operating working capital
items....................... (614) 4,059 1,025 5,491
Discontinued operations...... 872 (24) 1,358 (1,960)
--------- -------- --------- ---------
(1,928) (2,900) (6,690) (16,260)
--------- -------- --------- ---------
Investing Activities
Property, plant and equipment
expenditures................ (1,037) (4,051) (4,736) (11,346)
Short-term investments....... - 7,446 - 5,855
Proceeds from disposal of
property, plant and
equipment................... 9 - 2,000 -
Restricted certificate of
deposit and other assets.... (733) (437) (1,584) (885)
Discontinued operations...... (318) (2,586) 1,003 (7,460)
--------- -------- --------- ---------
(2,079) 372 (3,317) (13,836)
--------- -------- --------- ---------
Financing Activities
Proceeds on issuance of
shares...................... - 71 5,944 8,931
Acquisition and cancellation
of shares................... - - - (48)
Payments of notes payable.... (192) (453) (756) (1,289)
Discontinued operations...... (368) (697) (1,758) (1,945)
--------- -------- --------- ---------
(560) (1,079) 3,430 5,649
--------- -------- --------- ---------
Net (decrease) in cash......... (4,567) (3,607) (6,577) (24,447)
Cash and cash equivalents,
beginning of period........... 4,876 4,992 6,886 25,832
--------- -------- --------- ---------
Cash and cash equivalents, end
of period..................... $309 $1,385 $309 $1,385
--------- -------- --------- ---------
--------- -------- --------- ---------
Supplemental Cash Flow
Information:
Interest paid................ $298 $80 $923 $287
--------- -------- --------- ---------
--------- -------- --------- ---------

The accompanying notes are an integral part of these interimconsolidated financial statements.