FORM 6-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

For the month of October, 2012
 
Commission File Number   001-31522

Eldorado Gold Corporation
 (Translation of registrant's name into English)	

1188-550 Burrard Street
Bentall 5
Vancouver, B.C.
Canada  V6C 2B5
 (Address of principal executive offices)	

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F....[    ]..... Form 40-F...[. X .]...
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes  [    ]  No [ X ]
If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ________

Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date:  October 29, 2012	ELDORADO GOLD CORPORATION

/s/ Dawn Moss

Dawn Moss, Corporate Secretary	

 

 
 
Exhibits
 
99.1    Unaudited Condensed Consolidated Financial Statements 
99.2    Management Discussion and Analysis for the three and nine month periods ended September 30, 2012
99.3    Certification of Interim Filings - CEO
99.4   Certification of Interim Filings - CFO

 

 
September 30, 2012	Unaudited Condensed Consolidated Financial Statements	

 	Suite 1188, 550 Burrard Street
Vancouver, British Columbia
V6C 2B5	
 	 	
 	Phone: (604) 687-4018
 Fax: (604) 687-4026	

 

 
Eldorado Gold Corporation
Unaudited Condensed Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)

 	 	Note	 	 	September 30, 2012	 	 	December 31, 2011	 	
ASSETS	 	 	 	 	 	 	 	 	 	 	 	
Current assets	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	 	 	 	$	271,401	 	 	$	393,763	 	
Restricted cash	 	 	6	 	 	 	36,794	 	 	 	55,390	 	
Marketable securities	 	 	 	 	 	 	3,052	 	 	 	2,640	 	
Accounts receivable and other	 	 	 	 	 	 	55,402	 	 	 	42,309	 	
Inventories	 	 	 	 	 	 	216,216	 	 	 	164,057	 	
 	 	 	 	 	 	 	582,865	 	 	 	658,159	 	
Non-current inventories	 	 	 	 	 	 	21,700	 	 	 	26,911	 	
Investments in significantly influenced companies	 	 	 	 	 	 	30,093	 	 	 	18,808	 	
Deferred income tax assets	 	 	 	 	 	 	3,253	 	 	 	4,259	 	
Restricted assets and other	 	 	 	 	 	 	42,387	 	 	 	38,430	 	
Defined benefit pension plan	 	 	8	 	 	 	4,155	 	 	 	-	 	
Property, plant and equipment	 	 	 	 	 	 	6,012,298	 	 	 	2,847,910	 	
Goodwill	 	 	 	 	 	 	669,311	 	 	 	365,928	 	
 	 	 	 	 	 	 	7,366,062	 	 	 	3,960,405	 	
LIABILITIES & EQUITY	 	 	 	 	 	 	 	 	 	 	 	 	
Current liabilities	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable and accrued liabilities	 	 	 	 	 	 	214,596	 	 	 	168,367	 	
Current debt	 	 	7	 	 	 	45,558	 	 	 	81,031	 	
 	 	 	 	 	 	 	260,154	 	 	 	249,398	 	
Debt	 	 	7	 	 	 	50,000	 	 	 	-	 	
Asset retirement obligations	 	 	 	 	 	 	51,286	 	 	 	43,213	 	
Defined benefit pension plan	 	 	8	 	 	 	-	 	 	 	19,969	 	
Deferred income tax liabilities	 	 	 	 	 	 	871,056	 	 	 	336,579	 	
 	 	 	 	 	 	 	1,232,496	 	 	 	649,159	 	
Equity	 	 	 	 	 	 	 	 	 	 	 	 	
Share capital	 	 	9	 	 	 	5,290,316	 	 	 	2,855,689	 	
Treasury stock	 	 	 	 	 	 	(7,317	)	 	 	(4,018	)	
Contributed surplus	 	 	 	 	 	 	69,278	 	 	 	30,441	 	
Accumulated other comprehensive loss	 	 	 	 	 	 	(17,162	)	 	 	(10,069	)	
Retained earnings	 	 	 	 	 	 	479,894	 	 	 	382,716	 	
Total equity attributable to shareholders of the Company	 	 	 	 	 	 	5,815,009	 	 	 	3,254,759	 	
Attributable to non-controlling interests	 	 	 	 	 	 	318,557	 	 	 	56,487	 	
 	 	 	 	 	 	 	6,133,566	 	 	 	3,311,246	 	
 	 	 	 	 	 	 	7,366,062	 	 	 	3,960,405	 	
 
Approved on behalf of the Board of Directors
 
(Signed) Robert R. Gilmore 	Director  	(Signed) Paul N. Wright 	Director 	
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 
Eldorado Gold Corporation
Unaudited Condensed Consolidated Income Statements
(Expressed in thousands of U.S. dollars except per share amounts)

 	 	Three months ended	 	 	Nine months ended	 	
 	 	September 30,	 	 	September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Revenue	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Metal sales	 	$	281,839	 	 	$	327,364	 	 	$	797,579	 	 	$	799,088	 	
Cost of sales	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Production costs	 	 	107,615	 	 	 	95,020	 	 	 	293,340	 	 	 	250,762	 	
Depreciation and amortization	 	 	26,082	 	 	 	29,954	 	 	 	78,635	 	 	 	91,014	 	
 	 	 	133,697	 	 	 	124,974	 	 	 	371,975	 	 	 	341,776	 	
Gross profit	 	 	148,142	 	 	 	202,390	 	 	 	425,604	 	 	 	457,312	 	
Exploration expenses	 	 	11,130	 	 	 	6,913	 	 	 	29,899	 	 	 	15,359	 	
General and administrative expenses	 	 	17,518	 	 	 	11,207	 	 	 	53,345	 	 	 	45,815	 	
Defined benefit pension plan expense	 	 	638	 	 	 	418	 	 	 	1,899	 	 	 	1,274	 	
Share based payments	 	 	4,396	 	 	 	3,599	 	 	 	17,210	 	 	 	15,403	 	
Transaction costs	 	 	552	 	 	 	-	 	 	 	20,005	 	 	 	-	 	
Foreign exchange (gain) loss	 	 	(1,926	)	 	 	3,530	 	 	 	(2,227	)	 	 	5,558	 	
Operating profit	 	 	115,834	 	 	 	176,723	 	 	 	305,473	 	 	 	373,903	 	
(Gain) loss on disposal of assets	 	 	(23	)	 	 	420	 	 	 	423	 	 	 	(2,672	)	
Loss (gain) on marketable securities and other investments	 	 	-	 	 	 	1,528	 	 	 	(1,032	)	 	 	239	 	
Loss on investments in significantly influenced companies	 	 	1,375	 	 	 	1,067	 	 	 	3,119	 	 	 	2,861	 	
Other income	 	 	(264	)	 	 	(2,792	)	 	 	(2,641	)	 	 	(4,808	)	
Asset retirement obligation accretion	 	 	457	 	 	 	387	 	 	 	1,328	 	 	 	1,160	 	
Interest and financing costs	 	 	1,481	 	 	 	2,293	 	 	 	3,615	 	 	 	5,407	 	
Profit before income tax	 	 	112,808	 	 	 	173,820	 	 	 	300,661	 	 	 	371,716	 	
Income tax expense	 	 	34,435	 	 	 	63,077	 	 	 	98,965	 	 	 	120,520	 	
Profit for the period	 	 	78,373	 	 	 	110,743	 	 	 	201,696	 	 	 	251,196	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Attributable to:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Shareholders of the Company	 	 	75,845	 	 	 	102,478	 	 	 	190,320	 	 	 	229,816	 	
Non-controlling interests	 	 	2,528	 	 	 	8,265	 	 	 	11,376	 	 	 	21,380	 	
 	 	 	78,373	 	 	 	110,743	 	 	 	201,696	 	 	 	251,196	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted average number of shares outstanding	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	712,789	 	 	 	549,085	 	 	 	680,121	 	 	 	548,800	 	
Diluted	 	 	713,340	 	 	 	551,309	 	 	 	681,222	 	 	 	550,737	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings per share attributable to shareholders of the Company:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings per share	 	 	0.11	 	 	 	0.19	 	 	 	0.28	 	 	 	0.42	 	
Diluted earnings per share	 	 	0.11	 	 	 	0.19	 	 	 	0.28	 	 	 	0.42	 	

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

Eldorado Gold Corporation
Unaudited Condensed Consolidated Statements of Comprehensive Income
(Expressed in thousands of U.S. dollars)
 
 	 	Three months ended	 	 	Nine months ended	 	
 	 	September 30,	 	 	September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit for the period	 	$	78,373	 	 	$	110,743	 	 	$	201,696	 	 	$	251,196	 	
Other comprehensive income loss:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Change in fair value of available-for-sale financial assets (net of income taxes of nil and $12; and nil and $12)	 	 	(231	)	 	 	(399	)	 	 	(1,368	)	 	 	(1,383	)	
Realized gains on disposal of available-for-sale financial assets transferred to net income	 	 	-	 	 	 	-	 	 	 	(24	)	 	 	(434	)	
Actuarial losses on defined benefit pension plans	 	 	-	 	 	 	-	 	 	 	(5,701	)	 	 	-	 	
Total other comprehensive loss for the period	 	 	(231	)	 	 	(399	)	 	 	(7,093	)	 	 	(1,817	)	
Total comprehensive income for the period	 	 	78,142	 	 	 	110,344	 	 	 	194,603	 	 	 	249,379	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Attributable to:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Shareholders of the Company	 	 	75,614	 	 	 	102,079	 	 	 	183,227	 	 	 	227,999	 	
Non-controlling interests	 	 	2,528	 	 	 	8,265	 	 	 	11,376	 	 	 	21,380	 	
 	 	 	78,142	 	 	 	110,344	 	 	 	194,603	 	 	 	249,379	 	

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

Eldorado Gold Corporation
Unaudited Condensed Consolidated Statements of Cash Flows
(Expressed in thousands of U.S. dollars)
 
 	 	 	 	 	Three months ended	 	 	Nine months ended	 	
 	 	 	 	 	September 30,	 	 	September 30,	 	
 	 	Note	 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Cash flows generated from (used in):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating activities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit for the period	 	 	 	 	$	78,373	 	 	$	110,743	 	 	$	201,696	 	 	$	251,196	 	
Items not affecting cash	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asset retirement obligation accretion	 	 	 	 	 	457	 	 	 	387	 	 	 	1,328	 	 	 	1,160	 	
Depreciation and amortization	 	 	 	 	 	26,082	 	 	 	29,954	 	 	 	78,635	 	 	 	91,014	 	
Unrealized foreign exchange (gain) loss	 	 	 	 	 	(446	)	 	 	1,500	 	 	 	(809	)	 	 	6,261	 	
Deferred income tax (recovery) expense	 	 	 	 	 	(42	)	 	 	10,079	 	 	 	(6,730	)	 	 	374	 	
(Gain) loss on disposal of assets	 	 	 	 	 	(23	)	 	 	420	 	 	 	423	 	 	 	(2,672	)	
Loss on investments in significantly influenced companies	 	 	 	 	 	1,375	 	 	 	1,067	 	 	 	3,119	 	 	 	2,861	 	
Loss (gain) on marketable securities and other investments	 	 	 	 	 	-	 	 	 	1,528	 	 	 	(1,032	)	 	 	239	 	
Share based payments	 	 	 	 	 	4,396	 	 	 	3,599	 	 	 	17,210	 	 	 	15,403	 	
Defined benefit pension plan expense	 	 	 	 	 	638	 	 	 	418	 	 	 	1,899	 	 	 	1,274	 	
 	 	 	 	 	 	110,810	 	 	 	159,695	 	 	 	295,739	 	 	 	367,110	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Changes in non-cash working capital	 	 	11	 	 	 	20,743	 	 	 	13,933	 	 	 	(121,914	)	 	 	(2,389	)	
 	 	 	 	 	 	 	131,553	 	 	 	173,628	 	 	 	173,825	 	 	 	364,721	 	
Investing activities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash received on acquisition of subsidiary	 	 	5	 	 	 	-	 	 	 	-	 	 	 	18,789	 	 	 	-	 	
Purchase of property, plant and equipment	 	 	 	 	 	 	(136,779	)	 	 	(76,028	)	 	 	(303,891	)	 	 	(201,630	)	
Proceeds from the sale of property, plant and equipment	 	 	 	 	 	 	99	 	 	 	24	 	 	 	890	 	 	 	41	 	
Net proceeds on pre-production sales	 	 	 	 	 	 	17,412	 	 	 	-	 	 	 	37,434	 	 	 	-	 	
Purchase of marketable securities	 	 	 	 	 	 	2,152	 	 	 	(1,609	)	 	 	-	 	 	 	(1,823	)	
Proceeds from the sale of marketable securities	 	 	 	 	 	 	-	 	 	 	-	 	 	 	230	 	 	 	6,345	 	
Funding of non-registered supplemental retirement plan investments, net	 	 	 	 	 	 	-	 	 	 	43	 	 	 	14,486	 	 	 	(4,937	)	
Investments in significantly influenced companies	 	 	 	 	 	 	(11,947	)	 	 	(2,470	)	 	 	(15,359	)	 	 	(3,788	)	
Decrease in restricted cash	 	 	 	 	 	 	20,240	 	 	 	35	 	 	 	18,571	 	 	 	(2,963	)	
 	 	 	 	 	 	 	(108,823	)	 	 	(80,005	)	 	 	(228,850	)	 	 	(208,755	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Financing activities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Issuance of common shares for cash	 	 	 	 	 	 	3,430	 	 	 	22,631	 	 	 	20,261	 	 	 	30,616	 	
Dividend paid to non-controlling interests	 	 	 	 	 	 	(967	)	 	 	(4,473	)	 	 	(2,238	)	 	 	(8,095	)	
Dividend paid to shareholders	 	 	 	 	 	 	(43,262	)	 	 	(33,426	)	 	 	(93,142	)	 	 	(61,167	)	
Purchase of treasury stock	 	 	 	 	 	 	(691	)	 	 	(280	)	 	 	(6,702	)	 	 	(6,438	)	
Long-term and bank debt proceeds	 	 	 	 	 	 	-	 	 	 	2,579	 	 	 	50,000	 	 	 	5,782	 	
Long-term and bank debt repayments	 	 	 	 	 	 	(24,429	)	 	 	(29,749	)	 	 	(35,516	)	 	 	(74,465	)	
 	 	 	 	 	 	 	(65,919	)	 	 	(42,718	)	 	 	(67,337	)	 	 	(113,767	)	
Net (decrease) increase in cash and cash equivalents	 	 	 	 	 	 	(43,189	)	 	 	50,905	 	 	 	(122,362	)	 	 	42,199	 	
Cash and cash equivalents - beginning of period	 	 	 	 	 	 	314,590	 	 	 	305,638	 	 	 	393,763	 	 	 	314,344	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents - end of period	 	 	 	 	 	 	271,401	 	 	 	356,543	 	 	 	271,401	 	 	 	356,543	 	
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 
Eldorado Gold Corporation
Unaudited Condensed Consolidated Statements of Changes in Equity
(Expressed in thousands of U.S. dollars)
 
 	 	 	 	 	Three months ended	 	 	Nine months ended	 	
 	 	 	 	 	September 30,	 	 	September 30,	 	
 	 	 	 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
 	 	 	 	 	 	$	 	 	 	$	 	 	 	$	 	 	 	$	 	
Share capital	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	5,282,368	 	 	 	2,825,024	 	 	 	2,855,689	 	 	 	2,814,679	 	
Shares issued upon exercise of share options, for cash	 	 	 	 	 	3,430	 	 	 	22,631	 	 	 	20,261	 	 	 	29,131	 	
Transfer of contributed surplus on exercise of options	 	 	 	 	 	4,518	 	 	 	6,714	 	 	 	22,674	 	 	 	9,074	 	
Shares issued on acquisition of European Goldfields Ltd.	 	 	5	 	 	 	-	 	 	 	-	 	 	 	2,380,140	 	 	 	-	 	
Shares issued for deferred phantom units	 	 	 	 	 	 	-	 	 	 	-	 	 	 	11,552	 	 	 	-	 	
Shares issued upon exercise of warrants, for cash	 	 	 	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	1,485	 	
Balance end of period	 	 	 	 	 	 	5,290,316	 	 	 	2,854,369	 	 	 	5,290,316	 	 	 	2,854,369	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Treasury stock	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	 	(7,355	)	 	 	(4,432	)	 	 	(4,018	)	 	 	-	 	
Purchase of treasury stock	 	 	 	 	 	 	(691	)	 	 	(280	)	 	 	(6,702	)	 	 	(6,438	)	
Shares redeemed upon exercise of restricted share units	 	 	 	 	 	 	729	 	 	 	499	 	 	 	3,403	 	 	 	2,225	 	
Balance end of period	 	 	 	 	 	 	(7,317	)	 	 	(4,213	)	 	 	(7,317	)	 	 	(4,213	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Contributed surplus	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	 	70,444	 	 	 	30,828	 	 	 	30,441	 	 	 	22,967	 	
Share based payments	 	 	 	 	 	 	4,081	 	 	 	3,742	 	 	 	16,231	 	 	 	15,689	 	
Shares redeemed upon exercise of restricted share units	 	 	 	 	 	 	(729	)	 	 	(499	)	 	 	(3,403	)	 	 	(2,225	)	
Options issued on acquisition of European Goldfields Ltd.	 	 	5	 	 	 	-	 	 	 	-	 	 	 	31,130	 	 	 	-	 	
Deferred phantom units granted on acquisition of	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
European Goldfields Ltd.	 	 	 	 	 	 	-	 	 	 	-	 	 	 	29,105	 	 	 	-	 	
Transfer to share capital on exercise of options and deferred phantom units	 	 	 	 	 	 	(4,518	)	 	 	(6,714	)	 	 	(34,226	)	 	 	(9,074	)	
Balance end of period	 	 	 	 	 	 	69,278	 	 	 	27,357	 	 	 	69,278	 	 	 	27,357	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated other comprehensive loss	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	 	(16,931	)	 	 	(3,055	)	 	 	(10,069	)	 	 	(1,637	)	
Other comprehensive loss for the period	 	 	 	 	 	 	(231	)	 	 	(399	)	 	 	(7,093	)	 	 	(1,817	)	
Balance end of period	 	 	 	 	 	 	(17,162	)	 	 	(3,454	)	 	 	(17,162	)	 	 	(3,454	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Retained earnings	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	 	447,311	 	 	 	224,818	 	 	 	382,716	 	 	 	125,221	 	
Dividends paid	 	 	 	 	 	 	(43,262	)	 	 	(33,426	)	 	 	(93,142	)	 	 	(61,167	)	
Profit attributable to shareholders of the Company	 	 	 	 	 	 	75,845	 	 	 	102,478	 	 	 	190,320	 	 	 	229,816	 	
Balance end of period	 	 	 	 	 	 	479,894	 	 	 	293,870	 	 	 	479,894	 	 	 	293,870	 	
Total equity attributable to shareholders of the Company	 	 	 	 	 	 	5,815,009	 	 	 	3,167,929	 	 	 	5,815,009	 	 	 	3,167,929	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Non-controlling interests	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance beginning of period	 	 	 	 	 	 	316,029	 	 	 	41,041	 	 	 	56,487	 	 	 	36,021	 	
Profit attributable to non-controlling interests	 	 	 	 	 	 	2,528	 	 	 	8,265	 	 	 	11,376	 	 	 	21,380	 	
Dividends declared to non-controlling interests	 	 	 	 	 	 	-	 	 	 	-	 	 	 	(9,399	)	 	 	(8,095	)	
Acquired non-controlling interest	 	 	5	 	 	 	-	 	 	 	-	 	 	 	260,093	 	 	 	-	 	
Balance end of period	 	 	 	 	 	 	318,557	 	 	 	49,306	 	 	 	318,557	 	 	 	49,306	 	
Total equity	 	 	 	 	 	 	6,133,566	 	 	 	3,217,235	 	 	 	6,133,566	 	 	 	3,217,235	 	
 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)

1.  	General Information	
 
Eldorado Gold Corporation (“Eldorado” or the “Company”) is a gold exploration, development, mining and production company. The Company has ongoing exploration and development projects in Turkey, China, Greece, Brazil and Romania. The Company acquired control of European Goldfields Ltd. (“EGU”) in February 2012, including its producing mine, Stratoni, and development projects, Olympias and Skouries, in Greece and its development project, Certej, in Romania.
 
Eldorado is a public company which is listed on the Toronto Stock Exchange and New York Stock Exchange and is incorporated and domiciled in Canada.

2.  	Basis of preparation	
 
These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 ‘Interim Financial Reporting’.  They do not include all of the information and footnotes required by the International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board for full annual financial statements and should be read in conjunction with the Company’s annual financial statements for the year ended December 31, 2011.
 
Other than the adoption of new accounting policies described in note 3, the same accounting policies are used in the preparation of these condensed consolidated interim financial statements as for the most recent audited annual financial statements and reflect all the adjustments necessary for fair presentation in accordance with IFRS of the results for the interim periods presented.

3.  	Adoption of new accounting policies and new accounting developments	
 
(a)      Revenue recognition of other metals concentrate
 
Due to the acquisition of EGU in February 2012, the Company adopted a new accounting policy for revenue recognition of other metals concentrate. Revenues from the sale of concentrate are recognised when the risks and rewards of ownership have been transferred to the customer and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received.
 
A number of the Company’s concentrate products are sold under pricing arrangements where final prices are determined by quoted market prices in a period subsequent to the date of sale. These concentrates are provisionally priced at the time of sale based on forward prices for the expected date of the final settlement. The provisionally priced sales of concentrate contain an embedded derivative, which does not qualify for hedge accounting. These embedded derivatives are recognized at fair value through revenue until the date of final price determination. Subsequent variations in the price are recognized as revenue adjustments as they occur until the price is finalized.
 
 (b)  Upcoming changes in accounting standards
 
Accounting standards effective in 2013 and 2015 are disclosed in the Company’s consolidated financial statements for the year ended December 31, 2011.

4.  	Critical accounting estimates and judgements	
 
 	The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.	
 
 	Estimates and underlying assumptions are reviewed at each period end. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.	

(1)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
4.	Critical accounting estimates and judgements (continued)	
 
 	Significant areas requiring the use of management estimates include assumptions and estimates relating to determining defined proven and probable reserves, value beyond proven and probable reserves, fair values for purposes of purchase price allocations for business acquisitions, asset impairment analysis, asset retirement obligations, share-based payments and warrants, pension benefits, valuation allowances for deferred income tax assets, the provision for income tax liabilities, deferred income taxes and assessing and evaluating contingencies.	
 
 	Actual results could differ from these estimates.  Outlined below are some of the areas which require management to make judgments, estimates and assumptions in determining carrying values.	
 
 Purchase price allocation
 	Business combinations require judgment and estimates to be made at the date of acquisition in relation to determining asset and liability fair values and the allocation of the purchase consideration over the fair value of the assets and liabilities.	
 
 	In respect of mining company acquisitions, such as the acquisition of EGU in February 2012, purchase consideration is typically allocated to the mineral reserves and resources being acquired. The estimate of reserves and resources is subject to assumptions relating to life of the mine and may change when new information becomes available. Changes in reserves and resources as a result of factors such as production costs, recovery rates, grade or reserves or commodity prices could impact depreciation rates, asset carrying values and environmental and restoration provisions. Changes in assumptions over long-term commodity prices, market demand and supply, and economic and regulatory climates could also impact the carrying value of assets, including goodwill.	
 
 Estimated recoverable reserves and resources
 	Mineral reserve and resource estimates are based on various assumptions relating to operating matters, including, with respect to production costs, mining and processing recoveries, cut-off grades, as well as assumptions relating to long-term commodity prices and, in some cases, exchange rates, inflation rates and capital costs. Cost estimates are based on feasibility study estimates or operating history. Estimates are prepared by appropriately qualified persons, but will be impacted by forecasted commodity prices, inflation rates, exchange rates, capital and production costs and recoveries amongst other factors. Estimated recoverable reserves and resources are used to determine the depreciation of property, plant and equipment at operating mine sites, in accounting for deferred stripping costs, in performing impairment testing and for forecasting the timing of the payment of decommissioning and restoration costs. Therefore, changes in the assumptions used could impact the carrying value of assets, depreciation and impairment charges recorded in the income statement and the carrying value of the decommissioning and restoration provision.	
 
 Asset retirement obligations
 	Asset retirement obligations are based on future cost estimates using information available at the balance sheet date. Asset retirement obligations are adjusted at each reporting period for changes to factors such as the expected amount of cash flows required to discharge the liability, the timing of such cash flows and the discount rate. Asset retirement obligations require other significant estimates and assumptions such as: requirements of the relevant legal and regulatory framework, and the timing, extent and costs of required decommissioning and restoration activities. To the extent the actual costs differ from these estimates, adjustments will be recorded and the income statement may be impacted.	
 
Current and deferred taxes
 	The Company calculates current and deferred tax provisions for each of the jurisdictions in which it operates. Actual amounts of income tax expense are not final until tax returns are filed and accepted by the relevant authorities. This occurs subsequent to the issuance of financial statements. Therefore, profit in subsequent periods will be affected by the amount that estimates differ from the final tax return.	

(2)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
4.	Critical accounting estimates and judgements (continued)	
 
 	Judgment is required in assessing whether deferred tax assets and certain deferred tax liabilities are recognized on the balance sheet. The Company also evaluates the recoverability of deferred tax assets based on an assessment of the ability to use the underlying future tax deductions before they expire against future taxable income. Deferred tax liabilities arising from temporary differences on investments in subsidiaries, joint ventures and associates are recognized unless the reversal of the temporary differences is not expected to occur in the foreseeable future and can be controlled. Assumptions about the generation of future taxable profits and repatriation of retained earnings depend on management’s estimates of future production and sales volumes, commodity prices, reserves, operating costs, decommissioning and restoration costs, capital expenditures, dividends and other capital management transactions.	
 
 	Judgement is also required in the application of income tax legislation. These estimates and judgments are subject to risk and uncertainty and could result in an adjustment to current and deferred tax provisions and a corresponding credit or debit to profit.	
 
5.  	Acquisition of European Goldfields Ltd.	
 
On February 24, 2012 the Company acquired 100% of the issued and outstanding shares of EGU.  Under the terms of the Arrangement former EGU shareholders received 0.85 of an Eldorado common share and C$0.0001 in cash for each EGU share. Eldorado issued 157,959,316 common shares pursuant to the Arrangement.  EGU holds a 95% stake in the Kassandra Mines district in Greece, which is comprised of the Stratoni Mine, and the Olympias and Skouries development projects, and an 80% stake in the Certej development project in Romania.
 
The Company acquired EGU to increase its presence in the Aegean region and leverage local operating knowledge and expertise.
 
The goodwill of $303,383 resulting from the acquisition arises mainly on the recognition of deferred income tax liabilities and non-controlling interests and represents, among other things, the exploration potential within the assets acquired and future variability in the price of minerals. None of the goodwill is deductible for tax purposes.
 
In April 2007, Hellas Gold (“Hellas”), a subsidiary of EGU, agreed to sell to Silver Wheaton (Caymans) Ltd. (“Silver Wheaton”) all of the silver metal to be produced from ore extracted during the mine-life within an area of approximately seven square kilometres around the Stratoni mine up to 15 million ounces, or 20 million ounces if additional silver is processed through the Stratoni mill from areas other than the current producing mine. The sale was made in consideration of a prepayment to Hellas of $57.5 million in cash, plus a payment per ounce of payable silver equal to the lesser of $3.90 and the prevailing market price per ounce calculated, due and payable at the time of delivery. The expected cash flows associated with the sale of the silver to Silver Wheaton at a price lower than market price have been reflected in the fair value of the mining interest recorded upon acquisition of EGU. The Company has presented the value of any expected future cash flows from the sale of any future silver production to Silver Wheaton as part of the mining interest, as the Company did not receive any of the original upfront payment. Further, the Company does not believe that the agreement to sell to Silver Wheaton meets the definition of an onerous contract or other liability as the obligation only arises upon production of the silver.

(3)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
5.	Acquisition of European Goldfields Ltd. (continued)	
 
A preliminary allocation of the purchase price, which is subject to final adjustments, is as follows:
 
Preliminary purchase price:	 	 	 	
 	 	 	 	
157,959,316 common shares of shares of Eldorado at C$15.05/share	 	$	2,380,140	 	
4,713,248 replacement options	 	 	31,130	 	
1,931,542 equity settled deferred phantom units	 	 	29,105	 	
Cash consideration	 	 	19	 	
Total Consideration	 	$	2,440,394	 	
 	 	 	 	 	
Net assets acquired:	 	 	 	 	
 	 	 	 	 	
Cash	 	$	18,808	 	
Accounts receivable	 	 	20,844	 	
Inventory	 	 	9,689	 	
Other assets	 	 	9,951	 	
Mining interests	 	 	2,990,047	 	
Goodwill	 	 	303,383	 	
Accounts payable	 	 	(100,776	)	
Non-current liabilities	 	 	(9,242	)	
Deferred income taxes	 	 	(542,217	)	
Non-controlling interest	 	 	(260,093	)	
 	 	$	2,440,394	 	
 
For the purpose of these condensed consolidated financial statements, the purchase consideration has been allocated on a preliminary basis to the fair value of assets acquired and liabilities assumed based on management’s best estimates taking into account all available information at the time of acquisition as well as applicable information at the time these condensed consolidated financial statements were prepared. The Company will continue to review information and perform further analysis with respect to these assets, prior to finalizing the allocation of the purchase price.
 
Eldorado has conducted a preliminary assessment of contingent liabilities identified during its due diligence and has recognized certain contingent liabilities in its initial accounting for the acquisition. However, the Company is continuing its review to determine whether additional contingent liabilities exist. If during the measurement period new information is found that identifies adjustments to the amount of contingent liabilities recognized initially, or additional contingent liabilities that existed at the acquisition date, then the acquisition accounting will be revised to reflect the resulting adjustments to the amounts initially recognized.   During the current quarter the Company received additional information regarding a contingent legal liability that existed at acquisition date.  This liability relates to a case before the European Commission that challenges the value of the original transfer of property from the Greek State.  This added information has resulted in an increase to the liabilities acquired and the goodwill recognized of $28,832.
 
The fair value of the common shares and replacement options issued and the equity settled deferred phantom units (“DPUs”) as part of the consideration paid for EGU was based on the closing share price on February 24, 2012 on the Toronto Stock Exchange.   The value of the replacement options was calculated using the Black-Scholes model.  The following inputs were used to value the replacement options:

Risk-free interest rate	 	1.28%	 	
Expected volatility (range)	 	39% – 44%	 	
Expected life (range)	 	0.7 – 1.7 years	 	
Expected dividends per share	 	Cdn $0.09	 	
Forfeiture rate	 	0%	 	

(4)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
5.	Acquisition of European Goldfields Ltd. (continued)	
 
Acquisition related costs of $552 have been charged to transaction costs in the consolidated income statement for the quarter ended September 30, 2012 (YTD – $20,005).
 
These consolidated financial statements include EGU’s results from February 24, 2012 to September 30, 2012. The revenue included in the consolidated income statement since February 24, 2012 contributed by EGU was $34,358.  This is from the sales of zinc, lead and silver concentrates produced at the Stratoni Mine in Greece. The net loss was $18,776.
 
Had EGU been consolidated from January 1, 2012, the consolidated income statement would include revenue of $42,136 and a net loss of $41,820 from EGU.
 
Eldorado received net cash of $18,789 as a result of the EGU transaction. This net increase of cash was a result of an acquired cash balance of $18,808 less cash consideration of $19.

6.  	Restricted cash	
 
Restricted cash represents short-term interest-bearing money market securities and funds held on deposit as collateral for the following loans:
 
 	 	September 30, 2012	 	 	December 31, 2011	 	
 	 	 	 	 	 	 	
Eastern Dragon CMB standby letter of credit loan (note 7(b))	 	$	36,794	 	 	$	52,390	 	
Unamgen deposit security HSBC letter of credit	 	 	-	 	 	 	3,000	 	
 	 	 	36,794	 	 	 	55,390	 	
 
7.  	Debt	
 
 	 	September 30, 2012	 	 	December 31, 2011	 	
Current:	 	 	 	 	 	 	
Jinfeng construction loan  (a)	 	$	3,767	 	 	$	19,929	 	
Eastern Dragon CMB standby letter of credit loan (b)	 	 	31,541	 	 	 	50,786	 	
Eastern Dragon HSBC revolving loan facility (c)	 	 	10,250	 	 	 	10,316	 	
 	 	 	45,558	 	 	 	81,031	 	
Non-current:	 	 	 	 	 	 	 	 	
    HSBC revolving credit facility (d)	 	 	50,000	 	 	 	-	 	
 	 	 	50,000	 	 	 	-	 	

(a) Jinfeng construction loan
 
In 2009, Guizhou Jinfeng Mining Ltd. (“Jinfeng”), our 82% owned subsidiary entered into a RMB 680.0 million ($107,239) construction loan facility (“the construction loan”) with China Construction Bank (“CCB”). The construction loan has a term of 6 years commencing on February 27, 2009 and is subject to a floating interest rate adjusted annually at 95% of the prevailing lending rate stipulated by the People’s Bank of China for similar loans. The effective interest as at September 30, 2012 was 6.70%.
 
Scheduled quarterly payments of RMB 35.0 million ($5,520) are anticipated to repay the principal loan balance in full by the end of 2012. Any pre-payments are applied to reduce future payments starting from the final payment.
 
Jinfeng made its quarterly scheduled payment of RMB 35.0 million ($5,520) in September of 2012, reducing the balance remaining to RMB 25.0 million ($3,943) at September 30, 2012.

(5)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
7.	Debt (continued)	
 
Net deferred financing costs in the amount of $176 have been included as an offset in the balance of the loan in the financial statements and are being amortized using the effective interest method.
 
(b) Eastern Dragon CMB standby letter of credit loan
 
In January 2010, Rock Mining Industry Development Company Limited (“Eastern Dragon”), our 95% owned subsidiary, entered into a RMB 320.0 million ($50,465) standby letter of credit loan with CMB. This loan has a one year term. In January 2012, the term was extended for a second year term to January 2013 and the annual management fee of 10% of the interest accrued on the outstanding amount paid quarterly was removed. In addition, the floating interest rate is now adjusted monthly at the prevailing lending rate stipulated by the People’s Bank of China for working capital loans. This loan is collateralized by way of a restricted cash deposit as funding of the irrevocable letter of credit issued by Sino Gold to CMB. The collateral was increased in January 2012 from $52,300 to $56,500. The interest rate on this loan as at September 30, 2012 was 6.00%.
 
In September 2012, we repaid RMB 120.0 million ($18,924), releasing $20,000 of the restricted cash balance. At September 30, 2012, RMB 200.0 million ($31,541) remained outstanding.
 
 (c) Eastern Dragon HSBC revolving loan facility
 
In May 2010, Eastern Dragon entered into a RMB 80.0 million ($12,616) revolving facility (“the facility”) with HSBC Bank (China). The facility can be drawn down in minimum tranches of RMB 1.0 million ($158) or its multiples. Each drawdown bears interest fixed at the prevailing lending rate stipulated by the People’s Bank of China on the date of drawdown. The Facility has a term of up to one year. In February, 2012, the Facility was reviewed by the bank and was extended to November 30, 2012.  The interest rate on this loan as at September 30, 2012 was 6.16%.
 
As at September 30, 2012, RMB 65.0 million ($10,250) was outstanding on this loan.
 
The Facility is secured by a letter of guarantee issued by Eldorado. Eldorado must maintain at all times a security coverage ratio of 110% of the amounts drawn down. As at September 30, 2012, the security coverage is $11,275.
 
This Facility is to be repaid in full when Eastern Dragon obtains the required project approval that will allow it to complete the second drawdown on the project-financing loan.
 
(d) HSBC revolving credit facility
 
 	In October 2011, the Company entered into a $280.0 million revolving credit facility with HSBC (“the credit facility”) and a syndicate of four other banks.   The credit facility matures on October 12, 2015 and is secured by the shares of SG Resources and Tuprag, wholly owned subsidiaries of the Company.  The interest rate on this loan as at September 30, 2012 was 1.97%.	
 
 	The prepaid loan cost on the balance sheet relating to the credit facility as at September 30, 2012 was $2,399.	
 
As at September 30, 2012, $50,000 had been drawn down on the credit facility.
 
(e) Entrusted loan
 
In November 2010, Eastern Dragon, HSBC Bank (China) and Qinghai Dachaidan Mining Ltd (“QDML ”) , our 90% owned subsidiary, entered into a RMB 12.0 million ($1,892) entrusted loan agreement, which was subsequently increased to RMB 180.0 million ($28,387) in September 2011. A subsequent increase to RMB 620.0 million ($97,776) occurred in September 2012.
 
Under the terms of the entrusted loan, QDML with its own funds entrusts HSBC Bank (China) to provide a loan facility in the name of QDML to Eastern Dragon.

(6)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
7.	Debt (continued)	
 
The entrusted loan can be drawn down in tranches. Each drawdown bears interest fixed at the prevailing lending rate stipulated by the People’s Bank of China on the date of drawdown. Each draw down has a term of three months and can be rolled forward at the discretion of QDML. The interest rate on this loan as at September 30, 2012 was 4.59%.
 
As at September 30, 2012, RMB 323.0 million ($50,938) had been drawn under the entrusted loan. Subsequent to September 30, 2012, RMB 10.0 million ($1,577) was drawn under this loan.
 
The entrusted loan has been recorded on a net settlement basis.

8.  	Defined benefit pension plan	
 
During the second quarter of 2012, the Company set up a Retirement Compensation Arrangement (“RCA”) trust account in connection with its non-registered supplementary pension plan. As it is a trust account, the assets in the account are protected from the Company’s creditors.  The RCA requires the Company to remit 50% of any contributions made to the Receiver General for Canada to a refundable tax account.
 
9.  	Share capital	
 
Eldorado’s authorized share capital consists of an unlimited number of voting common shares without par value and an unlimited number of non-voting common shares without par value. At September 30, 2012 there were no non-voting common shares outstanding (December 31, 2011 – none).
 
Voting common shares	 	Number of
Shares	 	 	Total

At January 1, 2012	 	 	551,682,917	 	 	$	2,855,689	 	
Shares issued upon exercise of share options, for cash	 	 	3,113,626	 	 	 	20,261	 	
Estimated fair value of share options exercised	 	 	-	 	 	 	22,674	 	
Shares issued on acquisition of European Goldfields Ltd. (note 5)	 	 	157,959,316	 	 	 	2,380,140	 	
Common shares issued for deferred phantom units	 	 	851,497	 	 	 	11,552	 	
At September 30, 2012	 	 	713,607,356	 	 	 	5,290,316	 	
 
10.  	Share-based payments	
 
(a) Share option plans
 
Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:
 
 	 	2012	 	
 	 	Weighted average exercise price Cdn	 	 	Number of
options	 	
At January 1,	 	$	12.60	 	 	 	8,616,113	 	
Regular options granted	 	 	14.80	 	 	 	5,906,073	 	
Replacement options granted on acquisition of European Goldfields Ltd. (note 5)	 	 	9.73	 	 	 	4,713,248	 	
Exercised	 	 	6.48	 	 	 	(3,113,626	)	
Forfeited	 	 	15.00	 	 	 	(633,119	)	
At September 30,	 	 	13.70	 	 	 	15,488,689	 	

(7)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
10.    Share-based payments (continued)
 
At September 30, 2012, 10,547,424 share options (September 30, 2011 – 5,127,291) with a weighted average exercise price of Cdn$12.99 (September 30, 2011 – Cdn$10.38) had vested and were exercisable. Options outstanding are as follows:

 	 	September 30, 2012	
 	 	Total options outstanding	 	Exercisable options	
Range of
exercise
price
Cdn$	 	Shares
 	 	Weighted
average
remaining
contractual
life
(years)	 	Weighted
average
exercise
price
Cdn$	 	Shares
 	 	Weighted
average
exercise
price
Cdn$	
$4.00 to $4.99	 	1,148,936	 	1.1	 	4.88	 	1,148,936	 	4.88	
$5.00 to $5.99	 	66,250	 	1.1	 	5.92	 	66,250	 	5.92	
$6.00 to $6.99	 	201,000	 	0.5	 	6.38	 	201,000	 	6.38	
$7.00 to $7.99	 	725,000	 	2.6	 	7.13	 	725,000	 	7.13	
$8.00 to $8.99	 	15,582	 	0.8	 	8.00	 	15,582	 	8.00	
$9.00 to $9.99	 	302,900	 	1.5	 	9.64	 	302,900	 	9.64	
$10.00 to $10.99	 	162,922	 	4.3	 	10.85	 	54,306	 	10.85	
 $11.00 to $11.99	 	10,000	 	1.5	 	11.40	 	10,000	 	11.40	
 $12.00 to $12.99	 	833,398	 	4.3	 	12.71	 	400,132	 	12.67	
$13.00 to $13.99	 	2,310,456	 	2.4	 	13.24	 	2,310,456	 	13.24	
$14.00 to $14.99	 	316,614	 	4.7	 	14.62	 	181,092	 	14.73	
$15.00 to $15.99	 	5,216,473	 	4.3	 	15.25	 	1,930,038	 	15.27	
$16.00 to $16.99	 	4,115,158	 	3.5	 	16.57	 	3,172,398	 	16.55	
$18.00 to $18.99	 	24,000	 	3.2	 	18.81	 	16,000	 	18.81	
 $19.00 to $20.02	 	40,000	 	4.1	 	19.19	 	13,334	 	19.19	
 	 	15,488,689	 	3.4	 	13.70	 	10,547,424	 	12.99	

Share based compensation expense related to share options for the quarter ended September 30, 2012 was $3,125 (YTD – $11,821).
 
(b) Restricted share unit plan
 
A total of 469,294 restricted share units (“RSUs”) at a grant-date fair value of Cdn$14.65 per unit were granted during the nine month period ended September 30, 2012 under the Company’s RSU plan and 156,432 were exercisable as at September 30, 2012.
 
The fair value of each RSU issued is determined as the closing share price at grant date.
 
A summary of the status of the restricted share unit plan and changes during the period ended September 30, 2012 is as follows:
 
 	 	Total RSUs	 	
Balance at December 31, 2011	 	 	253,587	 	
RSUs Granted	 	 	469,294	 	
Redeemed	 	 	(257,825	)	
Forfeited	 	 	-	 	
Balance at September 30, 2012	 	 	465,056	 	

As at September 30, 2012, 457,485 common shares purchased by the Company remain held in trust in connection with this plan. At the end of the period, 79,752 restricted share units are fully vested and exercisable. These shares purchased and held in trust have been included in treasury stock in the balance sheet.
 
Restricted share units expense for the period ended September 30, 2012 was $956 (YTD – $4,409).

(8)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
10.    Share-based payments (continued)
 
(c) Deferred share units plan
 
At September 30, 2012, 126,406 deferred share units (“DSUs”) were outstanding with a value of $1,927, which is included in accounts payable and accrued liabilities.
 
Compensation expense related to the DSUs was $315 for the period ended September 30, 2012 (YTD – $980).
 
(d) Deferred phantom units
 
In accordance with the acquisition agreement of EGU (note 5), the EGU DPUs will be converted on redemption to Eldorado shares using the 85% share exchange ratio as indicated within the plan of Arrangement.  The DPU plan was amended to allow for share settlement only.  Each DPU is exercisable into one common share entitling the holder to receive the common share for no additional consideration.  During the quarter, no DPUs were exercised (YTD – 851,497 DPUs). The remaining 1,080,045 DPUs are expected to be exercised during 2012.
 
11.  	Supplementary cash flow information	
 
 	 	Three months ended	 	 	Nine months ended	 	
 	 	September 30,	 	 	September 30,	 	
Changes in non-cash working capital	 	 	2012	 	 	 	2011	 	 	 	2012	 	 	 	2011	 	
Accounts receivable and other	 	$	(4,239	)	 	$	(9,769	)	 	$	(2,981	)	 	$	(1,454	)	
Inventories	 	 	5,451	 	 	 	(1,264	)	 	 	(27,912	)	 	 	(10,926	)	
Accounts payable and accrued liabilities	 	 	19,531	 	 	 	24,966	 	 	 	(91,021	)	 	 	9,991	 	
Total	 	 	20,743	 	 	 	13,933	 	 	 	(121,914	)	 	 	(2,389	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Supplementary cash flow information	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income taxes paid	 	 	18,939	 	 	 	34,249	 	 	 	81,576	 	 	 	95,011	 	
Interest paid	 	 	741	 	 	 	2,087	 	 	 	3,279	 	 	 	6,705	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Non-cash investing and financing activities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Shares, options and DPUs issued on acquisition of European Goldfields Ltd.	 	 	-	 	 	 	-	 	 	 	2,440,375	 	 	 	-	 	
 
12.  	Contingencies	
 
In May 2012, the Company, in connection with Hellas, entered into a Letter of Guarantee in favour of the Greek Ministry of Environment, Energy and Climate Change, in the amount of EUR50.0 million, as security for the due and proper performance of rehabilitation work committed in connection with the Environmental Impact Assessment approved for the Kassandra Mines. The Letter of Guarantee is renewed annually and expires on July 26, 2026. The Letter of Guarantee has an annual fee of 57 basis points.

(9)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
13.  	Segment information	
 
Identification of reportable segments
 
The Company has identified its operating segments based on the internal reports that are reviewed and used by the chief executive officer and the executive management (the chief operating decision makers or CODM) in assessing performance and in determining the allocation of resources.
 
The CODM considers the business from both a geographic and product perspective and assesses the performance of the operating segments based on measures of profit and loss as well as assets and liabilities. These measures include operating profit, expenditures on exploration, property, plant and equipment and non-current assets, as well as total debt. As at September 30, 2012, Eldorado had six reporting segments based on the geographical location of mining and exploration and development activities.
 
13.1    Geographical segments
 
Geographically, the operating segments are identified by country and by operating mine or mine under construction. The Brazil reporting segment includes the Vila Nova mine, development activities of Tocantinzinho and exploration activities in Brazil. The Turkey reporting segment includes the Kişladağ and the Efemçukuru mines and exploration activities in Turkey. The China reporting segment includes the Tanjianshan (“TJS”), Jinfeng and White Mountain mines, the Eastern Dragon development project and exploration activities in China. The Greece reporting segment includes the Stratoni mine and the Olympias, Skouries and Perama Hill development projects and exploration activities in Greece. The Romania reporting segment includes the Certej development project.  Other reporting segment includes operations of Eldorado’s corporate office and exploration activities in other countries. Financial information about each of these operating segments is reported to the CODM on at least a monthly basis.

For the three months ended September 30, 2012

 	 	Turkey
$	 	 	China
$	 
 	 	Brazil
$	 	 	Greece
$	 	 	Romania
$	 	 	Other
$	 	 	Total
$	 	
Information about profit and loss	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Metal sales to external customers	 		141,031	 	 		118,990	 	 		7,292	 	 		14,526	 	 		-	 	 		-	 	 		281,839	 	
Production costs	 	 	31,606	 	 	 	57,722	 	 	 	6,954	 	 	 	11,333	 	 	 	-	 	 	 	-	 	 	 	107,615	 	
Depreciation	 	 	3,550	 	 	 	18,969	 	 	 	1,094	 	 	 	1,845	 	 	 	-	 	 	 	624	 	 	 	26,082	 	
Gross profit	 	 	105,875	 	 	 	42,299	 	 	 	(756	)	 	 	1,348	 	 	 	-	 	 	 	(624	)	 	 	148,142	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other material items of income and expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Exploration expenses	 	 	2,390	 	 	 	4,578	 	 	 	3,215	 	 	 	(124	)	 	 	84	 	 	 	987	 	 	 	11,130	 	
Income tax expense	 	 	23,511	 	 	 	10,815	 	 	 	171	 	 	 	(64	)	 	 	-	 	 	 	2	 	 	 	34,435	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additions to property, plant and equipment during the period	 	 	71,068	 	 	 	36,807	 	 	 	4,538	 	 	 	32,853	 	 	 	2,125	 	 	 	(3,786	)	 	 	143,605	 	

(10)

 
Eldorado Gold Corporation
Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
13.	Segment information (continued)	
 
For the three months ended September 30, 2011	

 	 	Turkey
$	 	 	China
$	 	 	Brazil
$	 	 	Greece
$	 	 	Other
$	 	 	Total
$	 	
Information about profit and loss	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Metal sales to external customers	 	 	149,657	 	 	 	156,852	 	 	 	20,855	 	 	 	-	 	 	 	-	 	 	 	327,364	 	
Production costs	 	 	35,887	 	 	 	48,445	 	 	 	10,688	 	 	 	-	 	 	 	-	 	 	 	95,020	 	
Depreciation	 	 	3,180	 	 	 	24,609	 	 	 	1,540	 	 	 	-	 	 	 	625	 	 	 	29,954	 	
Gross profit	 	 	110,590	 	 	 	83,798	 	 	 	8,627	 	 	 	-	 	 	 	(625	)	 	 	202,390	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other material items of income and expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Exploration expenses	 	 	1,843	 	 	 	841	 	 	 	3,362	 	 	 	-	 	 	 	867	 	 	 	6,913	 	
Income tax expense	 	 	39,027	 	 	 	18,673	 	 	 	5,151	 	 	 	223	 	 	 	3	 	 	 	63,077	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additions to property, plant and equipment during the period	 	 	44,525	 	 	 	26,662	 	 	 	4,273	 	 	 	586	 	 	 	205	 	 	 	76,251	 	

For the nine months ended September 30, 2012	

 	 	Turkey
$	 	 	China
$	 	 	Brazil
$	 	 	Greece
$	 	 	Romania
$	 	 	Other
$	 	 	Total
$	 	
Information about profit and loss	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Metal sales to external customers	 		353,256	 	 	 	380,567	 	 	 	29,398	 	 	 	34,358	 	 	 	-	 	 	 	-	 	 	 	797,579	 	
Production costs	 	 	80,103	 	 	 	164,591	 	 	 	23,337	 	 	 	25,309	 	 	 	-	 	 	 	-	 	 	 	293,340	 	
Depreciation	 	 	8,949	 	 	 	60,465	 	 	 	3,241	 	 	 	4,522	 	 	 	-	 	 	 	1,458	 	 	 	78,635	 	
Gross profit	 	 	264,204	 	 	 	155,511	 	 	 	2,820	 	 	 	4,527	 	 	 	-	 	 	 	(1,458	)	 	 	425,604	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other material items of income and expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Exploration expenses	 	 	5,793	 	 	 	11,616	 	 	 	8,572	 	 	 	-	 	 	 	84	 	 	 	3,834	 	 	 	29,899	 	
Income tax expense	 	 	57,756	 	 	 	40,829	 	 	 	1,006	 	 	 	(640	)	 	 	-	 	 	 	14	 	 	 	98,965	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additions to property, plant and equipment during the period	 	 	144,787	 	 	 	80,113	 	 	 	15,449	 	 	 	55,807	 	 	 	4,680	 	 	 	1,157	 	 	 	301,993	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Information about assets and liabilities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Property, plant and equipment (*)	 	 	676,849	 	 	 	1,928,057	 	 	 	196,575	 	 	 	2,467,173	 	 	 	740,996	 	 	 	2,648	 	 	 	6,012,298	 	
Goodwill	 	 	-	 	 	 	365,928	 	 	 	-	 	 	 	303,383	 	 	 	-	 	 	 	-	 	 	 	669,311	 	
 	 	 	676,849	 	 	 	2,293,985	 	 	 	196,575	 	 	 	2,770,556	 	 	 	740,996	 	 	 	2,648	 	 	 	6,681,609	 	
Debt	 	 	-	 	 	 	45,558	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	50,000	 	 	 	95,558	 	

* Net of revenues from sale of pre-commercial production

(11)

 
Eldorado Gold Corporation
 Notes to the unaudited condensed consolidated financial statements
(Expressed in thousands of U.S. dollars, unless otherwise stated)
 
  Segment information (continued)
 
For the nine months ended September 30, 2011	

 	 	Turkey
$	 	 	China
$	 	 	Brazil
$	 	 	Greece
$	 	 	Other
$	 	 	Total
$	 	
Information about profit and loss	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Metal sales to external customers	 	 	322,520	 	 	 	438,632	 	 	 	37,936	 	 	 	-	 	 	 	-	 	 		799,088	 	
Production costs	 	 	85,645	 	 	 	147,192	 	 	 	17,925	 	 	 	-	 	 	 	-	 	 	 	250,762	 	
Depreciation	 	 	8,279	 	 	 	78,244	 	 	 	2,777	 	 	 	-	 	 	 	1,714	 	 	 	91,014	 	
Gross profit	 	 	228,596	 	 	 	213,196	 	 	 	17,234	 	 	 	-	 	 	 	(1,714	)	 	 	457,312	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other material items of income and expense	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Exploration expenses	 	 	5,860	 	 	 	2,371	 	 	 	4,574	 	 	 	-	 	 	 	2,554	 	 	 	15,359	 	
Income tax expense	 	 	70,428	 	 	 	50,514	 	 	 	(667	)	 	 	223	 	 	 	22	 	 	 	120,520	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additions to property, plant and equipment during the period	 	 	134,215	 	 	 	62,821	 	 	 	11,477	 	 	 	2,009	 	 	 	1,884	 	 	 	212,406	 	

As at December 31, 2011	

 	 	Turkey
$	 	 	China
$	 	 	Brazil
$	 	 	Greece
$	 	 	Other
$	 	 	Total
$	 	
Information about assets and liabilities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Property, plant and equipment	 	 	591,896	 	 	 	1,903,793	 	 	 	185,667	 	 	 	163,239	 	 	 	3,315	 	 	 	2,847,910	 	
Goodwill	 	 	-	 	 	 	365,928	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	365,928	 	
 	 	 	591,896	 	 	 	2,269,721	 	 	 	185,667	 	 	 	163,239	 	 	 	3,315	 	 	 	3,213,838	 	
Debt	 	 	-	 	 	 	81,031	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	81,031	 	
 
The Turkey and China segments derive their revenues from sales of gold and silver.  The Brazil segment derives its revenue from sales of iron ore. The Greece segment derives its revenue from sales of zinc, lead and silver concentrates.
 
13.2      Economic dependence
 
 	At September 30, 2012, each of our Chinese mines had one major customer, to whom each sells its entire production, as follows:	
 
TJS  Mine	Henan Zhongyuan Gold Smelter Factory Co. Ltd.of Zhongjin Gold Holding Co. Ltd.	
Jinfeng Mine	Zijin Refinery	
White Mountain Mine	Refinery of Shandong Humon Smelting Co. Ltd.	
 
 	13.3      Seasonality/cyclicality of operations	
 
 	Management does not consider operations to be of a significant seasonal or cyclical nature.	

(12)

 
MANAGEMENT’S DISCUSSION and ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (MD&A)
for the three and nine-month periods ended September 30, 2012
 
Throughout this MD&A, Eldorado , we, us, our and the Company mean Eldorado Gold Corporation.
This quarter means the third quarter of 2012. All dollar amounts are in United States dollars unless stated otherwise.
 
The information in this MD&A is as of October 25, 2012. You should also read our audited consolidated financial statements for the year ended December 31, 2011 prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and the unaudited interim condensed consolidated financial statements for the three and nine-month periods ended September 30, 2012 prepared in accordance with International Accounting Standard (IAS) 34 – “Interim Financial Reporting”. We file our financial statements and MD&A with appropriate regulatory authorities in Canada and the United States. You can find more information about Eldorado, including our annual information form, on SEDAR at www.sedar.com.
 
Except for those related to our acquisition of European Goldfields Limited (EGU), there have been no changes to the following since we published our 2011 MD&A: critical accounting estimates, financial related risks and other risks and uncertainties. There has also been no material change in the legal status of our worldwide projects and operations since that time.

What’s inside
 
About Eldorado	1	
 	 	
Third Quarter Summary Results	1	
 	 	
Review of Financial Results	2	
 	 	
Quarterly updates	 	
Operations	4	
Development projects	8	
Exploration	9	
 	 	
Quarterly results	12	
 	 	
Non-IFRS measures	12	
 	 	
Operating cash flow, financial condition and liquidity	 	
Capital expenditures, Liquidity and capital resources	13	
Contractual obligations, Debt, Dividends, Equity	14	
 	 	
Other information	 	
Initial adoption of accounting policy	16	
New accounting developments	16	
Internal controls over financial reporting	16	
Qualified person	17	
Forward-looking information and risks	17	

 

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012		
 
About Eldorado
 
Based in Vancouver, Canada, Eldorado owns and operates gold mines around the world. Its activities involve all facets of the gold mining industry including exploration, development, production and reclamation.

Operating gold mines:
·  	Kisladag, in Turkey (100%)	
·  	Tanjianshan, in China (90%)	
·  	Jinfeng, in China (82%)	
·  	White Mountain, in China (95%)	
·  	Efemcukuru, in Turkey (100%)	
 
Development gold projects:
·  	Eastern Dragon, in China (95%)	
·  	Tocantinzinho, in Brazil (100%)	
·  	Perama Hill, in Greece (100%)	
·  	Olympias, in Greece (95%)	
·  	Skouries, in Greece (95%)	
·  	Certej, in Romania (80%)	
 
Other mines:
·  	Vila Nova – iron ore, in Brazil (100%)	
·  	Stratoni – silver, lead, zinc, in Greece (95%)	
 
Eldorado’s common shares are listed on the following exchanges:
·  	Toronto Stock Exchange (TSX) under the symbol ELD	
·  	New York Stock Exchange (NYSE) under the symbol EGO	

ELD is part of the S&P/TSX Global Gold Index. EGO is part of the AMEX Gold BUGS Index.
 
Third quarter summary results

·  	Profit attributable to shareholders of the Company (net income) for the quarter was $75.8 million or $0.11 per share compared to $102.5 million or $0.19 per share for the same quarter in 2011.	

·  	Gold revenues were 15% lower than the same quarter in 2011 due to lower sales volumes and gold prices.	

·  	Gross profit from gold mining operations before taxes was $146.9 million for the quarter, 24% lower than the third quarter of 2011.	

·  	The Company generated $110.8 million in cash from operating activities before changes in non-cash working capital – a decrease of 31% over the same quarter in 2011.	

1

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Review of Financial Results
Summarized Financial Results	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Revenues (millions)	 	$	281.8	 	 	$	327.4	 	 	$	797.6	 	 	$	799.1	 	
Gold sold (ounces)	 	 	154,841	 	 	 	179,513	 	 	 	438,421	 	 	 	490,207	 	
Average realized gold price ($/ounce)	 	$	1,670	 	 	$	1,700	 	 	$	1,665	 	 	$	1,546	 	
Cash operating costs ($/ounce sold) (1)	 	$	493	 	 	$	397	 	 	$	475	 	 	$	401	 	
Total cash cost ($ per ounce sold) (1)	 	$	567	 	 	$	463	 	 	$	549	 	 	$	467	 	
Gross profit from gold mining operations (1) (millions)	 	$	146.9	 	 	$	193.2	 	 	$	416.3	 	 	$	438.5	 	
Net Income (millions)	 	$	75.8	 	 	$	102.5	 	 	$	190.3	 	 	$	229.8	 	
Earnings per share attributable to shareholders of the Company – Basic ($/share)	 	$	0.11	 	 	$	0.19	 	 	$	0.28	 	 	$	0.42	 	
Earnings per share attributable to shareholders of the Company – Diluted ($/share)	 	$	0.11	 	 	$	0.19	 	 	$	0.28	 	 	$	0.42	 	
Dividends paid (Cdn$/share)	 	$	0.06	 	 	$	0.06	 	 	$	0.15	 	 	$	0.11	 	
Cash flow from operating activities before changes in non-cash working capital (1) (millions)	 	$	110.8	 	 	$	159.7	 	 	$	295.7	 	 	$	367.1	 	
 
(1)  	The Company has included non-IFRS performance measures such as cash operating costs, total cash costs, gross profit from gold mining operations and cash flow from operations before changes in non-cash working capital throughout this document. These are non-IFRS measures. Please see page 12 for discussion of non-IFRS measures.	
 
Net income for the quarter was $75.8 million (or $0.11 per share), compared with $102.5 million (or $0.19 per share) in the third quarter of 2011, a decrease of 26%. The decrease in net income year over year was due to lower gross profit from gold mining operations ($46.3 million or 24% lower), as well as higher general and administrative expense ($6.3 million higher), and exploration expense ($4.2 million higher). Revenues from gold sales for the quarter of $258.5 million were down $46.7 million or 15%, from the third quarter of 2011 due to lower sales volumes and prices. The Company sold 154,841 ounces in the third quarter of 2012 as compared with 179,513 ounces in the third quarter of 2011. The table below details the sales volumes by mine as compared to the previous year.
 
Sales volumes by mine	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
  Gold ounces sold	 	 	154,841	 	 	 	179,513	 	 	 	438,421	 	 	 	490,207	 	
  - Kisladag	 	 	83,750	 	 	 	87,121	 	 	 	210,905	 	 	 	204,345	 	
  - Tanjianshan	 	 	28,944	 	 	 	26,935	 	 	 	84,932	 	 	 	87,405	 	
  - Jinfeng	 	 	25,805	 	 	 	44,187	 	 	 	86,663	 	 	 	139,086	 	
  - White Mountain	 	 	16,342	 	 	 	21,270	 	 	 	55,921	 	 	 	59,371	 	
  Average price per oz.	 	$	1,670	 	 	$	1,700	 	 	$	1,665	 	 	$	1,546	 	
  Gold revenue (millions)	 	$	258.5	 	 	$	305.2	 	 	$	729.9	 	 	$	757.6	 	

Revenues from iron ore sales at Vila Nova during the quarter were $7.3 million compared to $20.9 million for the third quarter of 2011. A total of 123,180 dry metric tonnes were sold at an average price of $59 per dry metric tonne as compared to 170,781 dry metric tonnes at an average price of $122 per dry metric tonne for the third quarter of 2011. Revenues from concentrate sales at Stratoni totalled $14.5 million. The Company also recorded $1.5 million in by-product silver sales at its gold mines.

2

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Production costs
Production costs per ounce sold at our gold mining operations increased 23% over the third quarter of 2011, mainly as a result of higher unit production costs from our Chinese mines. The increase in unit costs at our Chinese mines was driven by the impact of lower grade mill feed on ounces produced. At Jinfeng, ore was added to mill feed from low grade ore stockpiles to augment lower ore production from the open pit. Production costs at Stratoni were $11.3 million and at Vila Nova were $7.0 million. Stratoni was acquired in 2012 as part of the acquisition of European Goldfields Ltd. Unit production costs at Vila Nova decreased 13% from the third quarter of 2011 due to lower waste stripping activity.

Depreciation and amortization expense
DD&A expense from gold mining operations was $26.1 million this quarter or $3.9 million lower than in the third quarter of 2011, mainly as a result of lower sales from Jinfeng and White Mountain.
 
Other expenses ($millions)	 	3 months ended September 30,	 	9 months ended September 30,	
 	 	         2012	 	2011	 	        2012	 	2011	
General and administrative	 	17.5	 	11.2	 	53.3	 	45.8	
Exploration	 	11.1	 	6.9	 	29.9	 	15.4	
Income tax	 	34.4	 	63.1	 	99.0	 	120.5	
Transaction costs	 	0.6	 	-	 	20.0	 	-	
Non-controlling interests	 	2.5	 	8.3	 	11.4	 	21.4	
 
General and administrative expenses
General and administrative expenses increased $6.3 million from the third quarter of 2011 mainly as a result of additional costs of our Athens office as a result of the acquisition of European Goldfields.

Exploration expenses
Exploration expenses during the third quarter increased $4.2 million year-over-year reflecting the increased scope of the Company’s exploration program as a result of the acquisition of European Goldfields.

Income tax expense
The effective tax rate for the third quarter of 2012 was 31% as compared with 36% in 2011. Foreign exchange fluctuations increased the effective tax rate in 2011 over the expected rate of 28% while withholding taxes on dividends from subsidiaries increased the effective tax rate in 2012.

Non-controlling interests
Non-controlling interests in the third quarter fell significantly from the third quarter of 2011 due to lower profits from Jinfeng and White Mountain as a result of decreased sales volumes.

3

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Operations update

Summarized Operating Results	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Gross profit – gold mining operations (millions)	 	$	146.9	 	 	$	193.2	 	 	$	416.3	 	 	$	438.5	 	
Ounces produced – including Efemcukuru pre-commercial production	 	 	169,565	 	 	 	179,195	 	 	 	465,794	 	 	 	490,201	 	
Cash operating costs ($ per ounce sold)	 	$	493	 	 	$	397	 	 	$	475	 	 	$	401	 	
Total cash cost ($ per ounce sold)	 	$	567	 	 	$	463	 	 	$	549	 	 	$	467	 	
Kisladag	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit – gold mining operations (millions)	 	$	104.8	 	 	$	109.7	 	 	$	261.3	 	 	$	226.1	 	
Ounces produced	 	 	84,016	 	 	 	86,788	 	 	 	211,298	 	 	 	204,309	 	
Cash operating costs ($ per ounce sold)	 	$	334	 	 	$	377	 	 	$	335	 	 	$	383	 	
Total cash cost ($ per ounce sold)	 	$	363	 	 	$	401	 	 	$	365	 	 	$	406	 	
Tanjianshan	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit – gold mining operations (millions)	 	$	24.5	 	 	$	25.0	 	 	$	45.1	 	 	$	63.3	 	
Ounces produced	 	 	28,944	 	 	 	26,935	 	 	 	84,932	 	 	 	87,405	 	
Cash operating costs ($ per ounce sold)	 	$	396	 	 	$	353	 	 	$	411	 	 	$	365	 	
Total cash cost ($ per ounce sold)	 	$	593	 	 	$	541	 	 	$	606	 	 	$	552	 	
Jinfeng	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit – gold mining operations (millions)	 	$	8.9	 	 	$	40.0	 	 	$	39.2	 	 	$	106.7	 	
Ounces produced	 	 	25,821	 	 	 	44,202	 	 	 	86,686	 	 	 	139,116	 	
Cash operating costs ($ per ounce sold)	 	$	946	 	 	$	424	 	 	$	775	 	 	$	418	 	
Total cash cost ($ per ounce sold)	 	$	1,044	 	 	$	509	 	 	$	855	 	 	$	483	 	
White Mountain	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit – gold mining operations (millions)	 	$	8.7	 	 	$	18.5	 	 	$	28.5	 	 	$	42.4	 	
Ounces produced	 	 	16,342	 	 	 	21,270	 	 	 	55,921	 	 	 	59,371	 	
Cash operating costs ($ per ounce sold)	 	$	766	 	 	$	475	 	 	$	634	 	 	$	475	 	
Total cash cost ($ per ounce sold)	 	$	813	 	 	$	519	 	 	$	679	 	 	$	517	 	
Efemcukuru 1	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Ounces produced –  pre-commercial production	 	 	14,442	 	 	 	-	 	 	 	26,957	 	 	 	-	 	
 
1	Gold concentrate produced at Efemcukuru prior to the date of commercial production (December 1, 2011) has been treated as pre-commercial production. At September 30, 2012, all of this concentrate had been processed.by the Kisladag Concentrate Treatment Plant. All costs and revenues associated with the production and sale of this concentrate are considered part of the capital expenditures of the project.  Approximately 44,600 contained ounces in gold concentrate remain at the Kisladag site and 6,500 contained ounces in gold concentrate are in storage at the Efemcukuru site.	
 
Gross profit from gold mining operations this quarter decreased $46.3 million, or 24% over the third quarter of 2011 due to a $31.1 million decrease in earnings from Jinfeng as well as a $9.8 million decrease in earnings from White Mountain. Jinfeng production fell 18,381 ounces as a result of delays in resuming full mining operations from the open pit, and the impact of lower grade stockpiled ore fed to production. White Mountain earnings and production were impacted by lower grade ore.

4

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Kisladag

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes placed on pad	 	 	3,245,700	 	 	 	3,520,220	 	 	 	9,645,766	 	 	 	9,055,906	 	
Average treated head grade - grams per tonne (g/t)	 	 	1.05	 	 	 	0.90	 	 	 	1.16	 	 	 	0.94	 	
Gold (ounces)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Produced	 	 	84,016	 	 	 	86,788	 	 	 	211,298	 	 	 	204,309	 	
-   Sold	 	 	83,750	 	 	 	87,121	 	 	 	210,905	 	 	 	204,345	 	
Cash operating costs (per ounce sold)	 	$	334	 	 	$	377	 	 	$	335	 	 	$	383	 	
Total cash costs (per ounce sold)	 	$	363	 	 	$	401	 	 	$	365	 	 	$	406	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gold revenues	 	$	139.8	 	 	$	148.7	 	 	$	350.1	 	 	$	319.8	 	
Depreciation and depletion	 	$	3.4	 	 	$	3.1	 	 	$	8.7	 	 	$	8.0	 	
Gross profit – gold mining operations	 	$	104.8	 	 	$	109.7	 	 	$	261.3	 	 	$	226.1	 	
Capital expenditure on mining interests	 	$	26.3	 	 	$	8.0	 	 	$	77.6	 	 	$	32.0	 	

Gold production at Kisladag for the quarter was slightly lower year over year mainly due to the stacking and leaching schedule. Daily production rates increased during the quarter and we expect to see an increase in production during the fourth quarter. Lower cash costs during the quarter were largely a result of higher grade material being placed on the leach pad during the year. Capital spending during the quarter included construction activities associated with the Phase IV expansion and capitalized waste stripping.

Tanjianshan

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes Milled	 	 	283,654	 	 	 	218,330	 	 	 	791,904	 	 	 	721,098	 	
Average Treated Head Grade – g/t	 	 	3.55	 	 	 	4.25	 	 	 	3.75	 	 	 	4.12	 	
Average Recovery Rate	 	 	83.0	%	 	 	82.5	%	 	 	82.8	%	 	 	82.3	%	
Gold (ounces)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Produced	 	 	28,944	 	 	 	26,935	 	 	 	84,932	 	 	 	87,405	 	
-   Sold	 	 	28,944	 	 	 	26,935	 	 	 	84,932	 	 	 	87,405	 	
Cash operating costs (per ounce sold)	 	$	396	 	 	$	353	 	 	$	411	 	 	$	365	 	
Total cash costs (per ounce sold)	 	$	593	 	 	$	541	 	 	$	606	 	 	$	552	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gold revenues	 	$	48.5	 	 	$	46.3	 	 	$	142.1	 	 	$	134.6	 	
Depreciation and depletion	 	$	6.6	 	 	$	6.5	 	 	$	20.2	 	 	$	22.1	 	
Gross profit – gold mining operations	 	$	24.5	 	 	$	25.0	 	 	$	69.6	 	 	$	63.3	 	
Capital expenditure on mining interests	 	$	8.2	 	 	$	1.9	 	 	$	15.1	 	 	$	4.9	 	

Gold production at Tanjianshan during the third quarter of 2012 was higher than the same quarter of 2011 as a result of increased mill throughput and slightly higher recovery rates, which offset the lower mill head grades. The increase in cash costs during the quarter was mainly due to the lower head grade. The major components of capital spending during the quarter were tailings dam construction and capitalized exploration.

5

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Jinfeng

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes Milled	 	 	356,575	 	 	 	379,352	 	 	 	10,62,891	 	 	 	1,161,739	 	
Average Treated Head Grade – g/t	 	 	2.43	 	 	 	4.26	 	 	 	2.77	 	 	 	4.21	 	
Average Recovery Rate	 	 	83.4	%	 	 	88.6	%	 	 	84.8	%	 	 	87.7	%	
Gold (ounces)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Produced	 	 	25,821	 	 	 	44,202	 	 	 	86,686	 	 	 	139,116	 	
-   Sold	 	 	25,805	 	 	 	44,187	 	 	 	86,663	 	 	 	139,086	 	
Cash operating costs (per ounce sold)	 	$	946	 	 	$	424	 	 	$	775	 	 	$	418	 	
Total cash costs (per ounce sold)	 	$	1,044	 	 	$	509	 	 	$	855	 	 	$	483	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gold revenues	 	$	42.9	 	 	$	74.4	 	 	$	144.8	 	 	$	212.2	 	
Depreciation and depletion	 	$	7.0	 	 	$	11.9	 	 	$	22.5	 	 	$	38.4	 	
Gross profit – gold mining operations	 	$	8.9	 	 	$	40.0	 	 	$	48.1	 	 	$	106.7	 	
Capital expenditure on mining interests	 	$	21.5	 	 	$	9.2	 	 	$	36.4	 	 	$	19.3	 	
 
Gold production at Jinfeng in the third quarter 2012 was lower than the same quarter of 2011 due to lower head grades and mill throughput. The open pit is currently in a waste stripping phase and lower grade stockpile material is being treated to make up for the lack of open pit ore. Cash costs were considerably higher due to the lower grade and mill throughput, as well as lower metallurgical recovery. The lower recovery was a result of the lower head grades. The major components of capital spending were underground mine development and waste stripping.

White Mountain

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes Milled	 	 	210,114	 	 	 	191,157	 	 	 	556,266	 	 	 	523,926	 	
Average Treated Head Grade – g/t	 	 	3.14	 	 	 	4.15	 	 	 	3.67	 	 	 	4.40	 	
Average Recovery Rate	 	 	83.1	%	 	 	81.9	%	 	 	85.4	%	 	 	81.4	%	
Gold (ounces)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Produced	 	 	16,342	 	 	 	21,270	 	 	 	55,921	 	 	 	59,371	 	
-   Sold	 	 	16,342	 	 	 	21,270	 	 	 	55,921	 	 	 	59,371	 	
Cash operating costs (per ounce sold)	 	$	766	 	 	$	475	 	 	$	634	 	 	$	475	 	
Total cash costs (per ounce sold)	 	$	813	 	 	$	519	 	 	$	679	 	 	$	517	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gold revenues	 	$	27.4	 	 	$	35.8	 	 	$	93.0	 	 	$	91.0	 	
Depreciation and depletion	 	$	5.3	 	 	$	6.2	 	 	$	17.6	 	 	$	17.8	 	
Gross profit – gold mining operations	 	$	8.7	 	 	$	18.5	 	 	$	37.3	 	 	$	42.4	 	
Capital expenditure on mining interests	 	$	8.4	 	 	$	6.7	 	 	$	20.3	 	 	$	11.8	 	

Gold production at White Mountain in the third quarter of 2012 was lower than in the same period of 2011. This decrease was largely due to lower grades being mined and processed during the quarter, which also negatively affected the cash costs. Capital spending this quarter was mostly for underground development and expansion of the tailings dam.

6

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Efemcukuru

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes Milled	 	 	93,779	 	 	 	-	 	 	 	259,556	 	 	 	-	 	
Average Treated Head Grade - g/t	 	 	9.31	 	 	 	-	 	 	 	9.38	 	 	 	-	 	
Average Recovery Rate (to Concentrate)	 	 	93.3	%	 	 	-	 	 	 	92.9	%	 	 	-	 	
Gold (ounces)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Produced – pre commercial production	 	 	14,442	 	 	 	-	 	 	 	26,957	 	 	 	-	 	
-   Sold – pre commercial production	 	 	10,524	 	 	 	-	 	 	 	22,905	 	 	 	-	 	
Average Realized Gold Price	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash operating costs (per ounce sold)	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Total cash costs (per ounce sold)	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gold revenues	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Depreciation and depletion	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Gross profit – gold mining operations	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Capital expenditure on mining interests	 	$	25.0	 	 	$	31.6	 	 	$	54.5	 	 	$	75.2	 	

During the quarter Efemcukuru recovered approximately 27,005 ounces of gold in concentrate, as the mine and mill operated at expected levels. The paste fill system was commissioned during the quarter and the underground crushing system was completed and is now operational.

During the quarter 14,442 ounces were poured as pre-commercial production during the commissioning and testing of the Kisladag concentrate treatment plant. In September, the concentrate treatment plant was not being operated pending modifications to the circuit.  We plan to sell the existing concentrate and future concentrate production to a third party until the modifications are completed. At the end of the quarter there were approximately 51,000 ounces of gold contained in concentrate.

Capital spending this quarter was mostly for underground development and underground infrastructure as well as completion and testing of the Kisladag concentrate treatment facility.
 
Vila Nova

Operating Data	 	3 months ended September 30,	 	 	9 months ended September 30,	 	
 	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
Tonnes Processed	 	 	161,859	 	 	 	148,220	 	 	 	528,024	 	 	 	438,315	 	
Iron Ore Produced	 	 	139,553	 	 	 	127,721	 	 	 	456,419	 	 	 	379,738	 	
Average Grade (% Fe)	 	 	63.5	%	 	 	63.5	%	 	 	63.5	%	 	 	64.1	%	
Iron Ore Tonnes	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
-   Sold	 	 	123,180	 	 	 	170,781	 	 	 	383,785	 	 	 	299,620	 	
Average Realized Iron Ore Price	 	$	59	 	 	$	122	 	 	$	77	 	 	$	127	 	
Cash Costs (per tonne produced)	 	$	56	 	 	$	64	 	 	$	61	 	 	$	60	 	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	$	7.3	 	 	$	20.9	 	 	$	29.4	 	 	$	37.9	 	
Depreciation and depletion	 	$	1.1	 	 	$	1.5	 	 	$	3.2	 	 	$	2.8	 	
Gross profit (loss) from mining operations	 	$	(0.8	)	 	$	8.6	 	 	$	2.8	 	 	$	20.7	 	
Capital expenditure on mining interests	 	$	0.4	 	 	$	0.5	 	 	$	0.7	 	 	$	0.9	 	

7

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Iron ore production in the third quarter of 2012 increased at Vila Nova compared to the same quarter of 2011, mainly as a result of improved efficiencies in both the mine and treatment plant. Three shipments were completed in the quarter. These were 2 lump shipments and one sinter shipment.

Stratoni

Operating Data	 	3 months ended September 30,	 	9 months ended September 30,	
 	 	2012	 	2011	 	2012	 	2011	
Tonnes ore mined (wet)	 	 	58,591	 	NA	 	 	144,062	 	NA	
Tonnes ore processed (dry)	 	 	55,911	 	NA	 	 	136,785	 	NA	
Pb grade (%)	 	 	5,96	%	NA	 	 	6,22	%	NA	
Zn grade (%)	 	 	9,69	%	NA	 	 	9,74	%	NA	
Ag grade (g/t)	 	 	155	 	NA	 	 	163	 	NA	
Tonnes of concentrate produced	 	 	14,084	 	NA	 	 	35,224	 	NA	
Tonnes of concentrate sold	 	 	15,891	 	NA	 	 	37,281	 	NA	
Average realized concentrate price (per  tonne)	 	$	913	 	NA	 	$	899	 	NA	
Cash Costs (per tonne of concentrate sold)	 	$	717	 	NA	 	$	679	 	NA	
Financial Data (millions)	 	 	 	 	 	 	 	 	 	 	
Revenues	 	$	14.5	 	NA	 	$	34.4	 	NA	
Depreciation and depletion	 	$	2.0	 	NA	 	$	4.7	 	NA	
Gross profit from mining operations	 	$	1.2	 	NA	 	$	4.4	 	NA	
Capital expenditure on mining interests	 	$	0.5	 	NA	 	$	2.6	 	NA	

During the third quarter, Stratoni mined 58,591 tonnes of run-of-mine ore and produced 14,084 tonnes of lead and zinc concentrate at an average cash cost of $717 per tonne of concentrate sold.  During the same period, Stratoni sold 15,891 tonnes of concentrate at an average price of $913 per tonne (4,719 tonnes of lead concentrate at an average price of $1,473 per dry metric tonne and 11,172 tonnes of zinc concentrate at an average price of $646 per dry metric tonne, minus prior period finalised sales adjustments). Stratoni operating and financial data for the 9 months period of 2012 shown in the table above reflect only operations subsequent to February 24, 2012, the date of the EGU acquisition.
 
Development project update

Eastern Dragon
At Eastern Dragon work continued during the quarter on the preparation of the Project Permit Approval (PPA) to be submitted to the National Development and Reform Commission (NDRC). We anticipate that the application will be submitted by the end of 2012. Construction activities have been suspended until the PPA is approved.
 
Tocantinzinho
The Tocantinzinho project was granted the Preliminary Environmental License (PEL) in September, an important milestone in the permitting phase. The PEL confirms the environmental feasibility of the project and allows the Company to apply for the Construction License, the final permit needed for construction to commence.   Work on site was limited to environmental and hydrology field work in the immediate area, along with geotechnical drilling of the proposed road corridor. The feasibility study is well advanced and will be completed by the end of 2012.

Perama Hill
Drilling activity at the Perama site continued throughout the quarter.  Geotechnical drill holes have been drilled in the plant site to support geotechnical design analysis for civil structures and foundations.  In addition drilling in the open pit area has been carried out to obtain drill core for geotechnical analysis for pit slope stability design. Processing of the Perama Environmental Impact Assessment (EIA) application through the Ministry of Environment (MOE) continues, with a decision expected before the end of the year. Public meetings have been held in the district as prescribed by the MOE.  All indications from the government agencies remain positive towards the project.

8

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Olympias
Rehabilitation of the Olympias underground mine and processing plant continued during the quarter.  In the mine, 406 meters of underground access was rehabilitated or developed. Development of the tunnel linking Stratoni and Olympias progressed well during the quarter, with 108 meters of advance. Metallurgical testwork to evaluate the proposed new processing facility at Stratoni continued during the third quarter. Commissioning of the Olympias processing plant was on-going during the quarter.

Skouries
Site work at Skouries during the quarter consisted mainly of tree cutting at the plant site, construction of access roads, and earthworks for various site infrastructures.

Certej
The Environmental Permit for Certej was approved by the Regional Department of Environment during the quarter. Concentrate samples from flotation testwork were completed and shipped to Australia. These samples represent the four major ore types at Certej and will be used to do laboratory scale testing of the Albion process. This testwork will be completed by the end of 2012. Construction work advanced during the quarter on the temporary power line to site and the water pumping station on the Mures River.
 
Exploration update

A total of 54,300 metres of exploration drilling were completed during the quarter at our exploration projects and mine operations in Greece, Romania, Turkey, Brazil, and China.  With 132,800 meters of drilling completed year-to-date, we are on track to complete our 2012 exploration programs according to plan.

Turkey
In Turkey, drilling during the quarter continued at the Efemçukuru minesite, and commenced at Kisladag and at three reconnaissance projects (Sebin, Dolek, and Gaybular).
 
Exploration drilling resumed at the Kisladag minesite late in the quarter, testing conceptual targets defined by a combination of three-dimensional induced polarization/resistivity surveys, detailed ground magnetics, and soil geochemistry anomalies.  This program is directed towards identifying possible mineralized satellite intrusions to the main porphyry system.

Six drillholes were completed at the Sebin porphyry/epithermal prospect in the Pontide Belt. The project area covers a large surface alteration zone with locally anomalous copper, molybdenum and gold values, but no significant mineralization has been intersected to date in drillholes.  Drilling also began at the Dolek prospect in the Pontide Belt, and at the Gaybular project in Western Turkey.

At Efemcukuru 32 drillholes (8,440 metres) were completed on the Kestane Beleni northwest extension (KBNW), South Ore Shoot (SOS), and Kokarpinar vein targets.  At KBNW, drilling defined a new shallowly northwest-plunging lower zone of mineralization which has been traced for nearly 400 metres along strike and remains open to the northwest.  At the SOS, drilling identified high gold grades at 50 to 75 metre stepouts from previous mineralized holes. At Kokarpinar, limited drillsite availability meant that drilling was focused on shallow targets on the central and southern part of the vein. Selected drilling results are summarized in the table below:

9

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Selected Q3 drilling results, Efemcukuru
Hole ID	From(m)	To (m)	Interval(m)	Au (g/t)	Ag (g/t)	Pb (%)	Zn (%)	
Kestane Beleni Northwest Extension (lower zone)	
KV-433	215.15	216.50	1.35	29.70	24.10	0.88	2.02	
KV-444	170.86	172.58	1.72	27.46	19.61	1.61	2.23	
KV-447	240.27	241.48	1.21	65.59	63.40	2.26	4.56	
KV-448	183.83	186.20	2.37	7.39	37.90	2.88	1.20	
South Ore Shoot (deep step-out drilling)	
KV-496	223.00	224.50	1.50	4.95	3.70	0.01	0.03	
KV-497	297.60	300.91	3.31	15.67	19.78	1.00	1.73	
KV-501	282.50	287.20	4.70	11.80	8.00	0.02	0.03	
including	286.10	287.20	1.10	44.80	26.70	0.01	0.02	
Kokarpinar Vein	
KV-459	222.55	227.50	4.95	6.84	(1)	(1)	(1)	
KV-423	225.20	226.00	0.80	283.00	110.00	0.03	0.11	
(1)  	Assays not yet completed.	
 
Greece

Drilling continued at the Piavitsa prospect, with seven holes completed and approximately 7,500 metres drilled during the quarter.  The primary target at Piavitsa is polymetallic, gold-silver rich, carbonate replacement sulfide mineralization along the Stratoni fault zone, similar to that typical of the Olympias deposit. All 23 drillholes completed in this year’s program have intersected the fault zone near the projected depth, and have cut intervals in the fault zone with some combination of massive sulfide, disseminated sulphide, or oxide material. Selected drilling results are summarized in the table below:

Selected Q3 drilling results, Piavitsa Project
Hole ID	From(m)	To (m)	Interval(m)	Au (g/t)	Ag (g/t)	Pb (%)	Zn (%)	
Stratoni Fault replacement-style zones	
PHG065	436.00	440.00	4.00	2.05	19.20	0.35	0.46	
PHG066	207.00	210.00	3.00	9.57	18.10	0.02	0.03	
PHG067A	62.00	66.00	4.00	2.12	3.50	0.02	0.05	
and	81.00	83.00	2.00	5.33	4.20	0.00	0.01	
PHG070	209.00	232.00	23.00	4.35	85.30	2.92	1.68	
including	215.00	223.00	8.00	11.89	228.40	8.27	4.65	
PHG071	160.70	168.20	7.50	1.21	14.30	0.19	0.76	
PHG072	182.00	188.00	6.00	1.38	7.70	0.06	0.11	
PHG073	42.00	54.00	12.00	2.21	37.00	0.44	1.70	
including	48.00	52.00	4.00	4.98	49.10	0.98	3.43	
PHG074	80.00	87.00	7.00	1.20	7.40	0.02	0.23	
PHG076	150.00	156.70	6.70	1.80	37.10	0.90	2.76	
 	184.90	185.40	0.50	42.40	25.00	0.11	0.29	
Hangingwall epithermal vein zones	
PHG078	86.70	107.00	20.30	2.32	11.40	0.31	0.56	
 	142.00	164.00	22.00	1.61	3.10	0.06	0.09	
 	197.80	210.00	12.20	1.00	13.90	0.06	0.04	

At Skouries, 17 drillholes (6,500 metres) were completed in the quarter, representing roughly half of the planned infill and confirmation programs.  Infill drillholes have documented low but consistent copper and gold grades within the in-pit inferred resource halo of the deposit including 94.0 metres at 0.3 grams per tonne gold and 0.27% copper in hole SOP-99; and 92.0 metres at 0.32 grams per tonne gold and 0.31% copper in hole SOP-100. Confirmation drillholes have intersected the intensely stockwork veined potassically-altered deposit core, with copper and gold grades similar to that predicted by the resource model.

10

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
At the Fisoka copper-gold porphyry prospect, two holes were completed during the quarter on the northern stock, and drilling has now shifted to the untested central stock area.  The northern stock drilling further defined the shallow supergene zone outlined in previous drilling programs.

At Perama Hill geotechnical, metallurgical and infill drilling was conducted on the main deposit and infrastructure sites.   Exploration drilling of targets outside of the existing resource model and at Perama South will commence in the fourth quarter of 2012.

Romania
At the Certej deposit, drill programs were completed during the quarter in the West Pit and Link Zone target areas.  In the West Pit area, drilling tested for extensions of the high-grade Hondol and Kaiser vein systems, which were historically exploited in underground openings.   Although this drilling failed to identify continuous high-grade veins, it outlined an approximately 50 metre wide, tabular west by northwest-striking zone of lower grade material which will be further tested in 2013. The Link Zone program, targeting underdrilled areas of the deposit between the West and Main zones, was completed during the quarter with 14 holes (5,700 metres) drilled. Most of these holes intersected zones of strong gold mineralization, which has a positive impact on the deposit resource model.

China
Exploration drilling in China during the quarter included projects in the Guizhou, Jilin, and Qinghai regions.

In Guizhou, exploration drilling was conducted within the Jinfeng mining license, at the nearby Shizhu prospect, and at the Weiruo prospect (Jinluo exploration license).  At the Jinfeng deposit, exploration drilling continued to focus on the F3, F6, and F7 mineralized structures from both surface and underground drill locations.  A total of 19 holes representing approximately 5,700 metres of drilling were completed.  The surface drilling program continues to produce high grade intercepts associated with the F6 structure, with notable intercepts during the quarter including 16.0 metres at 16.49 grams per tonne gold (HDDS0275); 6.0 metres at 15.59 grams per tonne gold (also HDDS0275), and 22.0 metres at 5.14 grams per  tonne gold (HDDS0282).

In Qinghai (Tanjianshan), the Qinglongtan North and Xijingou drilling programs were completed during the quarter, with 9 drillholes and 27 drillholes respectively. At Qinglongtan North, drilling focused on previously untested areas down dip and along strike from the northern end of the previously mined deposit.  Several of these holes intersected strong mineralization, including intervals of 26.0 metres at 9.24 grams per tonne gold (QD279) and 9.1 metres at 2.68 grams per tonne gold (QD278).  These new intercepts may represent a new high grade gold zone lying beneath the known deposit, and further drill testing is planned for the fourth quarter of 2012.  At Xinjingou, step-out drilling tested for extensions to the known zones of high grade mineralization.  Notable results from this program include 11.8 metres at 11.51 grams per tonne gold (XD073); 4.0 metres at 15.79 grams per tonne gold (XD075), and 9.0 metres at 8.01 grams per tonne gold (also XD075).  Results are being compiled to determine if further drilling is justified at Xijingou.  Late in the quarter, a second phase of drilling was initiated at the Jinlonggou deposit, testing a variety of near-pit structurally-defined targets.

In the Jilin region (White Mountain), drilling was conducted at the Dongdapo, Xiaoshiren, and Zhenzhumen prospect areas.  No significant results have been obtained to date.

Brazil
No drilling was conducted during the quarter at the Tocantinzinho project.  Exploration activities focused on reconnaissance-level evaluation of the adjacent Rubens Zilio license area through systematic soil sampling and prospecting.

At the Agua Branca project (35 kilometres south of Tocantinzinho) the 2012 drilling program was concluded, with 15 drillholes during the quarter testing for along-strike extensions of the Camarao zone.  

11

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Although the mineralized zone demonstrates continuity to the southwest, grades are erratic, and no significant wide intercepts were obtained.  Additional auger drilling, mapping, and rock sampling programs are underway to generate new drill targets at Agua Branca.
 
Fieldwork commenced during the quarter at the new Chapadinha project, which we are exploring under an option agreement.  The Chapadinha project covers an area with extensive garimpo workings exploiting narrow veins high gold grades.  Our work program is directed towards defining drill targets that will assess the potential of the area for a bulk-tonnage style deposit.
 
Quarterly results

millions (except per share amounts)
 	 	2012	 	 	2012	 	 	2012	 	 	2011	 	 	2011	 	 	2011	 	 	2011	 	 	2010	 	
 	 	Third quarter	 	 	Second quarter	 	 	First quarter	 	 	Fourth quarter	 	 	Third quarter	 	 	Second quarter	 	 	First quarter	 	 	Fourth quarter	 	
Total revenues	 	$	281.8	 	 	$	244.2	 	 	$	271.5	 	 	$	303.3	 	 	$	326.1	 	 	$	252.6	 	 	$	219.2	 	 	$	213.0	 	
Net income	 	$	75.8	 	 	$	46.6	 	 	$	67.9	 	 	$	88.8	 	 	$	102.5	 	 	$	74.9	 	 	$	52.5	 	 	$	45.2	 	
Earnings per share	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
- basic	 	$	0.11	 	 	$	0.07	 	 	$	0.11	 	 	$	0.16	 	 	$	0.19	 	 	$	0.14	 	 	$	0.10	 	 	$	0.08	 	
- diluted	 	$	0.11	 	 	$	0.07	 	 	$	0.11	 	 	$	0.16	 	 	$	0.19	 	 	$	0.14	 	 	$	0.10	 	 	$	0.08	 	

Non-IFRS measures

Throughout this document, we have provided measures prepared in accordance with IFRS, as well as some non-IFRS performance measures as additional information for investors who also use them to evaluate our performance.

Since there is no standard method for calculating non-IFRS measures, they are not a reliable way to compare us against other companies. Non-IFRS measures should be used along with other performance measures prepared in accordance with IFRS. We have defined our non-IFRS measures below and reconciled them with the IFRS measures we report.

Cash operating cost and total cash cost
The table below reconciles cash operating cost from our gold mining operations to production costs. We calculate costs according to the Gold Institute Standard. Total cash cost is the sum of cash operating cost, royalty expense and production tax expense.
 
Reconciliation of cash operating costs to production costs	 	2012	 	 	2011	 	 	2012	 	 	2011	 	
millions (except for gold ounces sold and cash operating cost per ounce sold)	 	 	Q3	 	 	 	Q3	 	 	YTD	 	 	YTD	 	
Production costs – excluding Vila Nova and Stratoni
(from consolidated income statement)	 	$	89.1	 	 	$	84.3	 	 	$	244.7	 	 	$	232.8	 	
Less:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
By-product credits and other adjustments	 	$	(1.3	)	 	$	(1.3	)	 	$	(4.2	)	 	$	(3.9	)	
Total Cash Cost	 	$	87.8	 	 	$	83.0	 	 	$	240.5	 	 	$	228.9	 	
Royalty expense and production taxes	 	$	(11.4	)	 	$	(11.8	)	 	$	(32.2	)	 	$	(32.5	)	
Cash operating cost	 	$	76.4	 	 	$	71.2	 	 	$	208.3	 	 	$	196.4	 	
Gold ounces sold	 	 	154,841	 	 	 	179,513	 	 	 	438,421	 	 	 	490,207	 	
Total cash cost per ounce sold	 	$	567	 	 	$	463	 	 	$	549	 	 	$	467	 	
Cash operating cost per ounce sold	 	$	493	 	 	$	397	 	 	$	475	 	 	$	401	 	

12

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Cash flow from mining operations before changes in non-cash working capital
We use cash flow from mining operations before changes in non-cash working capital to supplement our consolidated financial statements, and calculate it by not including the period to period movement of non-cash working capital items, like accounts receivable, advances and deposits, inventory, accounts payable and accrued liabilities.

Gross profit from gold mining operations
We use gross profit from gold mining operations to supplement our consolidated financial statements, and calculate it by deducting operating costs and depreciation, depletion and amortization directly attributable to gold mining operations from gross revenues directly attributable to gold mining operations.

These measures may differ from those used by, and may not be comparable to such measures as reported by, other issuers. We disclose these measures, which have been derived from our financial statements and applied on a consistent basis, because we believe they are of assistance in understanding the results of our operations and financial position and are meant to provide further information about our financial results to investors.
 
Operating cash flow, financial condition and liquidity

Operating activities before changes in non-cash working capital generated $110.8 million in cash this quarter, compared to $159.7 million in the same quarter of 2011. The decrease in cash flow year-over-year was due to lower operating cash flow from our mining operations.

Capital expenditures
We invested $136.8 million in capital expenditures, mine development, mining licences and other assets this quarter.

Mine development expenditures totalled $39.5 million:
·  	$5.2 million at Eastern Dragon	
·  	$4.1 million at Tocantinzinho	
·  	$2.8 million at Perama Hill	
·  	$14.7 million at Olympias	
·  	$10.6 million at Skourias (including capitalized exploration at Piavitsa and Fisoka)	
·  	$2.1 million at Certej	

Spending at our producing mines totalled $89.9 million:
·  	$26.3 million at Kisladag, mostly related to the Phase IV expansion and capitalized waste stripping	
·  	$25.0 million at Efemcukuru mostly on mine development and completion of start-up	
·  	$21.5 million at Jinfeng, mostly on underground development and waste stripping	
·  	$8.4 million at White Mountain, mainly related to underground mine development and tailings dam expansion	
·  	$8.2 million at Tanjianshan, mainly related to tailings dam expansion and sustaining capital	
·  	$0.5 million at Stratoni	

We also spent $6.9 million on land acquisition costs in Turkey, and $0.5 million related to fixed assets for our corporate offices in Canada and China.

13

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
Liquidity and capital resources

(millions)	 	September 30,
 2012	 	 	December 31,
2011	 	
Cash and cash equivalents	 	$	271.4	 	 	$	393.8	 	
Working capital	 	$	322.7	 	 	$	408.8	 	
Restricted collateralized accounts	 	$	36.8	 	 	$	55.4	 	
Debt	 	$	95.6	 	 	$	81.0	 	

Chinese regulations governing cash movements within and injected into the country require that our existing Chinese debt ($45.6 million) only be paid from cash flows generated from our Chinese operations that are party to the loans.

Cash and cash equivalents of $194.6 million are held by the Company’s operating entities in China and Turkey, where the cash was generated. No withholding tax liability has been recognized for the potential repatriation of these funds. If the cash held in these entities is repatriated by way of dividends to the parent company, withholding taxes would be due on the amounts at the rate of 10% for Turkey, and 5% to 10% for China.

Management believes that the working capital at September 30, 2012, together with future cash flows from operations, the unused portion of the HSBC revolving credit facility (discussed below), and, where appropriate, selected financing activities, is sufficient to support our planned and foreseeable commitments.

Contractual obligations
(millions)	 	2012	 	2013	 	2014	 	2015	 	2016 and
later	 	Total	
Debt	$	14.0	$	31.6	$	-	$	50.0	$	-	$	95.6	
Capital leases	 	-	 	0.1	 	-	 	-	 	-	 	0.1	
Operating leases	 	5.0	 	6.7	 	4.2	 	3.5	 	3.4	 	22.8	
Purchase obligations	 	112.9	 	76.7	 	14.2	 	13.2	 	12.6	 	229.6	
Totals	 	131.9	 	115.0	 	18.4	 	66.7	 	16.0	 	348.1	

The table does not include interest on debt. Purchase obligations during the period 2013 to 2016 include $12.6 million per year in minimum payments required under iron ore railway and port handling agreements associated with Vila Nova.

As at September 30, 2012, Hellas Gold had entered into off-take agreements pursuant to which Hellas Gold agreed to sell a total of 11,270 dry metric tonnes of zinc concentrates and 8,329 dry metric tonnes of lead/silver concentrates cumulative through the financial year ending December 31, 2013.

In April 2007, Hellas Gold agreed to sell to Silver Wheaton (Caymans) Ltd. (Silver Wheaton) all of the silver metal to be produced from ore extracted during the mine-life within an area of approximately seven square kilometres around Stratoni, up to 15 million ounces, or 20 million ounces if additional silver is processed through the Stratoni mill from areas other than the current producing mine. The sale was made in consideration of a prepayment to Hellas Gold of $57.5 million in cash, plus a fee per ounce of payable silver to be delivered to Silver Wheaton of the lesser of $3.90 and the prevailing market price per ounce. As at September 30, 2012 approximately 4.9 million ounces of silver have been delivered of the original 15 million ounce commitment.

14

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
In May 2012, the Company, in connection with Hellas, entered into a unsecured letter of guarantee in favour of the Greek Ministry of Environment, Energy and Climate Change, in the amount of Euro50.0 million, as security for the due and proper performance of rehabilitation work committed in connection with the Environmental Impact Assessment approved for the Kassandra Mines. The Letter of Guarantee is renewed annually and expires on July 26, 2026. The Letter of Guarantee has an annual fee of 0.57 basis points.

Debt
Significant changes in our debt from that disclosed in our December 31, 2011 annual MD&A and consolidated financial statements are as follows:

Eastern Dragon HSBC revolving loan facility (Facility)
In February, 2012, the Facility was reviewed by the bank and was extended to November 30, 2012.  The interest rate on this loan as at September 30, 2012 was 6.16%.

As at September 30, 2012, RMB 65.0 million ($10.3 million) was outstanding on this loan.

Eastern Dragon China Mercantile Bank (CMB) line of credit loan
In January 2012, the term of the CMB line of credit loan was extended to January 2013 and the annual management fee of 10% of the interest accrued on the outstanding amount paid quarterly was removed. In addition, the floating interest rate is now adjusted monthly at the prevailing lending rate stipulated by the People’s Bank of China for working capital loans. This loan is collateralized by way of a restricted cash deposit as funding of the irrevocable letter of credit issued by Sino Gold to CMB. The collateral was increased in January 2012 from $52.3 million to $56.5 million. The interest rate on this loan as at September 30, 2012 was 6.00%.
 
In September 2012, we repaid RMB 120.0 million ($18.9 million), releasing $20.0 million of the restricted cash balance. At September 30, 2012, RMB 200.0 million ($31.5 million) remained outstanding.

Jinfeng construction loans
During the year Jinfeng made its quarterly scheduled payments totalling RMB 105.0 million ($16.6 million) on the construction loan, reducing the balance remaining to RMB 25.0 million ($3.9 million) at September 30, 2012.

HSBC revolving credit facility
In October 2011, the Company entered into a $280.0 million revolving credit facility with HSBC (“the credit facility”) and a syndicate of four other banks. The credit facility matures on October 12, 2015 and is secured by the shares of SG Resources and Tuprag, wholly owned subsidiaries of the Company.  The interest rate on this loan as at September 30, 2012 was 1.97%.

The prepaid loan cost on the balance sheet relating to the credit facility as at September 30, 2012 was $2.4 million. As at September 30, 2012, $50.0 million had been drawn down on the credit facility.

Entrusted loan
In November 2010, Eastern Dragon, HSBC Bank (China) and Qinghai Dachaidan Mining Ltd (“QDML”), our 90% owned subsidiary, entered into a RMB 12.0 million ($1.9 million) entrusted loan agreement, which was subsequently increased to RMB 180.0 million ($28.4 million) in September 2011, and then increased to RMB 620.0 million ($97.8 million) in September 2012. Under the terms of the entrusted loan, QDML with its own funds entrusts HSBC Bank (China) to provide a loan facility in the name of QDML to Eastern Dragon.

The entrusted loan can be drawn down in tranches. Each drawdown bears interest fixed at the prevailing lending rate stipulated by the People’s Bank of China on the date of drawdown. Each draw down has a term of three months and can be rolled forward at the discretion of QDML. The interest rate on this loan as at September 30, 2012 was 4.59%.

15

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
As at September 30, 2012, RMB 323.0 million ($50.9 million) had been drawn under the entrusted loan. Subsequent to September 30, 2012, an additional RMB 10.0 million ($1.6 million) was drawn under this loan. The entrusted loan has been recorded on a net settlement basis in our financial statements.

Dividends
On August 24, 2012 Eldorado paid $43.3 million (Cdn$0.06 per share) in dividends to shareholders of record. Year to date Eldorado has paid $93.1 million in dividends.

Equity
This quarter we received net proceeds of $3.4 million for issuing 623,417 common shares related to stock options and warrants being exercised. Year to date we received net proceeds of $20.3 million for issuing 3,113,626 common shares related to stock options and warrants being exercised.

We may make minor accounting adjustments to these figures before they are presented in future consolidated financial statements.

Common shares outstanding
- as of October 25, 2012
- as of September 30, 2012	 
713,828,522
713,607,356	
Share purchase options
- as of October 25, 2012
(Weighted average exercise price per share: $13.70 Cdn)	15,390,693	

Other information

Initial adoption of accounting policy

Revenues from the sale of concentrate are recognised when the risks and rewards of ownership have been transferred to the customer and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received.

A number of the Company’s concentrate products are sold under pricing arrangements where final prices are determined by quoted market prices in a period subsequent to the date of sale. These concentrates are provisionally priced at the time of sale based on forward prices for the expected date of the final settlement. The provisionally priced sales of concentrate contain an embedded derivative, which does not qualify for hedge accounting. These embedded derivatives are recognized at fair value through revenue until the date of final price determination. Subsequent variations in the price are recognized as revenue adjustments as they occur until the price is finalized.

New accounting developments

Accounting standards effective in 2013 and 2015 are disclosed in the Company’s consolidated financial statements for the year ended December 31, 2011.

Internal controls over financial reporting
 
Eldorado’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Any system of internal control over financial reporting, no matter how well designed, has inherent limitations. As a result, even those systems determined to be effective can only provide reasonable assurance regarding the preparation and presentation of our financial statements. There have been no changes in our internal control over financial reporting in the third quarter of 2012 that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

16

 
MANAGEMENT’S DISCUSSION AND ANALYSIS
for the three and nine-month periods ended September 30, 2012	  	
 
For accounting purposes, we acquired control of EGU on February 24, 2012. As permitted by the Sarbanes-Oxley Act and applicable Canadian Securities Commission rules related to business acquisitions, we will exclude EGU operations from our annual assessment of internal controls over financial reporting for the year ending December 31, 2012.

Qualified Person

Except as otherwise noted, Norman Pitcher, P. Geo., our President, is the Qualified Person under NI 43-101 responsible for supervising the preparation of the scientific or technical information contained in this MD&A and verifying the technical data disclosed in this document relating to our operating mines and development projects.

Forward-looking information and risks
 
This MD&A includes statements and information about what we expect to happen in the future. When we discuss our strategy, plans and future financial and operating performance, or other things that have not yet happened in this review, we are making statements considered to be forward-looking information or forward-looking statements under Canadian and United States securities laws. We refer to them in this document as forward-looking information .
 
Key things to understand about the forward-looking information in this document:
 
•	It typically includes words and phrases about the future, such as:   plan, expect, forecast, intend, anticipate, estimate, budget, scheduled, may, could, would, might, will.	
 
•	Although it represents our current views, which we consider to be reasonable, we can give no assurance that the forward-looking information will prove to be accurate.	
 
•	It is based on a number of assumptions, including things like the future price of gold, anticipated costs and spending, and our ability to achieve our goals.	
 
•	It is also subject to the risks associated with our business, including	
 
 	•	the changing price of gold and currencies,	
 	•	actual and estimated production and mineral reserves and resources,	
 	•	the speculative nature of gold exploration,	
 	•	risks associated with mining operations and development,	
 	•	regulatory and permitting risks,	
 	•	acquisition risks, and	
 	•	other risks that are set out in our annual information form and MD&A.	
 
•	If our assumptions prove to be incorrect or the risks materialize, our actual results and events may vary materially from what we currently expect.	
 
To understand our risks you should review our annual information form, which includes a more detailed discussion of material risks that could cause actual results to differ significantly from our current expectations.
 
Forward-looking information is designed to help you understand management’s current views of our near and longer term prospects, and it may not be appropriate for other purposes. We will not necessarily update this information unless we are required to by securities laws.

17

Form 52-109F2
Certification of Interim Filings
Full Certificate

I, Paul Wright, Chief Executive Officer of Eldorado Gold Corporation certify the following:
 
1.	I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Eldorado Gold Corporation (the “issuer”) for the interim period ended September 30, 2012.	

2.	Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.	

3.  	Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.	

4.  	The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.	

5.  	Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings	

 	(a)	designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that	

 	(i)	material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and	

 	(ii)	information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and	

 	(b)	designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.	

5.1	The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework.	
 
5.2	N/A	
 
5.3	N/A	

6.	The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on July 1, 2012   and ended on September 30, 2012 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.	

Date:  October 26, 2012
 
“Paul N. Wright”
_______________________________
Paul Wright
Chief Executive Officer

 

Form 52-109F2
Certification of Interim Filings
Full Certificate

I, Fabiana Chubbs, Chief Financial Officer of Eldorado Gold Corporation certify the following:
 
1.	I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Eldorado Gold Corporation (the “issuer”) for the interim period ended September 30, 2012.	

2.	Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.	

3.  	Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.	

4.  	The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.	

5.  	Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings	

 	(a)	designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that	

 	(i)	material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and	

 	(ii)	information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and	

 	(b)	designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.	

5.1	The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework.	

5.2	N/A	
 
5.3	N/A	

6.	The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on July 1, 2012   and ended on September 30, 2012 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.	

Date:  October 26, 2012
 
“Fabiana Chubbs”
_______________________________
Fabiana Chubbs
Chief Financial Officer