REG - Guanajuato Silver Co - Q1 2023 Financial and Operating Results

Guanajuato SilverAnnouncement

26/05/2023 13:00

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RNS Number : 8398A  Guanajuato Silver Company Ltd.  26 May 2023

26 May 2023

Guanajuato Silver Company Limited

Guanajuato Silver Reports Q1 2023 Financial and Operating Results

~ Q1 Production of Over 938,000 AgEq Ounces ~

Guanajuato Silver Company Ltd. (the "Company" or "GSilver")
(TSXV:GSVR)(AQUIS:GSVR)(OTCQX:GSVRF) is pleased to announce financial and
operating results for the three months ended March 31, 2023. All dollar
amounts are in US dollars (US$). Production results are from the Company's
wholly owned El Cubo Mines Complex ("El Cubo"), Valenciana Mines Complex
("VMC") and San Ignacio mine ("San Ignacio") in Guanajuato, Mexico, and Topia
mine ("Topia") located in Durango, Mexico.

James Anderson, Chairman & CEO of Guanajuato Silver, said, "We continue
investing agressively in our assets as we build what we feel is Mexico's
fastest growing silver mining company. Operating results for Q1 continue to
demonstrate growth and are aligned with our expectations for this phase of the
ramp-up; I commend our 100% Mexican operations team for their technical
excellence as we optimize production at all four of our producing silver
mines. With quarter-over-quarter increases in silver-equivalent production
expected to continue, we remain on-pace to meet our stated full year
production guidance of 4.6 to 4.8 million silver-equivalent ("AgEq") ounces in
2023. We expect to end 2023 at a production run-rate of over 5 million AgEq
ounces per year."

 

Q1 2023 Highlights

·      Record production during the quarter of 938,047 AgEq ounces
derived from 458,803 ounces of silver; 4,413 ounces of gold; 906,696 pounds of
lead; and 1,153,138 pounds of zinc.

·      Record Revenue of $17.1M, up from $15.4M in Q4 2022; revenues
grew from increased production of AgEq ounces, as well as higher realized
silver and gold prices during the quarter.

·      Net Loss narrowed to $8.7M from $9.9M in Q4 2022.

·      Reduced environmental footprint through the implementation of an
underground hydraulic-fill tailings system at VMC; tailings material is now
being placed underground in some of the numerous voids that have been created
over VMC's 450-year mining history.

·      All-in sustaining cost ("AISC") of $21.83 per AgEq ounce produced
was slightly higher than $20.80 for Q4 2022; this increase was due primarily
to targeted capex investments designed to accelerate the ramp-up of operations
at the three Guanajuato mines; operating costs were also impacted by a
strengthening Mexican currency as approximately 75% of operating costs are
denominated in pesos.

·      Infrastructure upgrades are poised to deliver substantial
improvements in 2023; these upgrades include:

Ø The new Falcon concentrators at El Cubo and VMC are now fully operational
and set to generate improvements to precious metal recoveries going foward.

Ø The Cata shaft at VMC has been rehabilitated and is now fully operational;
over 300 tonnes per day of mineralized material is now moving through this
shaft which has reduced the time to move material to surface by approximately
80%.

Ø The implementation of hydraulic backfilling of tailings at VMC has allowed
for an acceleration in the operations at the Cata mill.

 

 

 

 

 

 CONSOLIDATED

                                             Three Months Ended
                                             March 31      December 31  September 30  June 30      March 31

2023
2022
2022
 2022
2022
 Operating
 Tonnes mined                                162,116       131,543      107,379       90,045       81,338
 Tonnes milled                               160,182       131,341      107,009       94,212       86,288
 Silver ounces produced                      458,803       401,244      329,298       155,912      125,423
 Gold ounces produced                        4,413         3,907        3,226         2,161        1,880
 Lead produced (lbs)                         906,696       811,492      537,608       -            -
 Zinc produced (lbs)                         1,153,138     1,261,554    677,127       -            -
 AgEq ounces produced((1))                   938,047       836,375      700,264       337,760      275,823

 Silver ounces sold                          474,954       405,384      311,754       159,840      134,281
 Gold ounces sold                            4,586         3,865        2,997         2,195        2,007
 Lead sold (lbs)                             955,441       846,281      504,408       -            -
 Zinc sold (lbs)                             1,242,389     1,600,811    273,327       -            -
 Ag/Eq ounces sold((1))                      969,603       866,319      628,256       342,987      294,842

 Cost per tonne ($)((5))                     98.16         98.30        90.37         60.89        64.32
 Cash cost per Ag/Eq ounce ($) ((1)(2)(5))   17.06         15.55        13.86         17.08        20.24
 AISC per Ag/Eq ounce ($) ((1)(3)(5))        21.83         20.80        19.53         24.15        25.79
 Financial                                   $             $            $             $            $
 Revenue                                     17,118,424    15,487,714   8,871,863     6,133,989    6,386,638
 Cost of Sales                               20,269,116    15,635,542   12,213,604    7,790,285    8,123,761
 Mine operating loss                         (3,150,692)   (147,830)    (3,341,742)   (1,656,295)  (1,737,122)
 Mine operating cashflow before taxes ((7))  187,214       2,367,522    (350,164)     7,923        12,634
 Net loss                                    (8,699,078)   (9,905,707)  (8,405,337)   (3,521,390)  (4,939,151)
 EBITDA((4)(5))                              (4,093,976)   (5,997,153)  (4,192,955)   (1,132,278)  (2,503,405)
 Adjusted EBITDA((4)(5))                     (3,482,463)   (2,129,871)  (2,758,286)   (2,244,593)  (2,059,594)

 Realized silver price per ounce((6))        22.50         21.23        19.06         22.56        23.97
 Realized gold price per ounce((6))          1,890.60      1,783.36     1,724.81      1,873.26     1,864.26
 Realized lead price per pound((6))          0.96          0.92         0.86          -            -
 Realized zinc price per pound((6))          1.42          1.42         1.44          -            -
 Working capital((5))                        (11,029,888)  (5,972,704)  (2,591,389)   (2,046,261)  (1,198,721)
 Shareholders
 Loss per share - basic and diluted          $(0.03)       $(0.03)      $(0.03)       $(0.02)      $(0.02)
 Weighted Average Shares Outstanding         322,849,823   302,153,922  271,509,812   226,033,272  224,556,314

 

1.     Silver equivalents are calculated using an 83.78:1 (Ag/Au), 0.04:1
(Ag/Pb) and 0.06:1 (Ag/Zn) ratio for Q1 2023; an 81.35:1 (Ag/Au), 0.05:1
(Ag/Pb) and 0.06:1 (Ag/Zn) ratio for Q4 2022; 89.97:1 (Ag/Au), 0.05:1 (Ag/Pb)
and 0.08:1 (Ag/Zn) ratio for Q3 2022; an 83.4:1 (Ag/Au) ratio for Q2 2022; and
an 80:1 (Ag/Au) ratio for Q1 2022, respectively.

2.     Cash cost per AgEq ounce includes mining, processing, and direct
overhead. See Reconciliation to IFRS on page 33 of GSilver's management's
discussion and analysis of the condensed consolidated interim financial
statements for the three months ended March 31, 2023 (the "Interim MD&A")
as filed on SEDAR.

3.     AlSC per AgEq oz includes mining, processing, direct overhead,
corporate general and administration expenses, on-site exploration,
reclamation and sustaining capital. See Reconciliation to IFRS on page 33 of
the Interim MD&A.

4.     See reconciliation of earnings before interest, taxes,
depreciation, and amortization on page 32 of the Interim MD&A.

5.     See "Non-IFRS Financial Measures" on page 32 of the Interim
MD&A.

6.     Based on provisional sales before final price adjustments, before
payable metal deductions, treatment, and refining charges.

7.     Mine operating cash flow before taxes is calculated by adding back
depreciation, depletion, and inventory write-downs to mine operating loss.
See Reconciliation to IFRS on page 32 of the Interim MD&A.

 

 

Technical Information

Reynaldo Rivera, VP of Exploration of GSilver, has approved the scientific and
technical information contained in this news release. Mr. Rivera is a member
of the Australasian Institute of Mining and Metallurgy (AusIMM - Registration
Number 220979) and a "qualified person" as defined by National Instrument
43-101, Standards of Disclosure for Mineral Projects.

 

For further information regarding Guanajuato Silver Company Ltd., please
contact:

 

JJ Jennex, Gerente de Comunicaciones, T: 604 723 1433

E: jjj@GSilver.com

Gsilver.com

 

VSA Capital - AQSE Corporate Adviser

T: +44 (0) 20 3005 5000

Simon Barton - Corporate Finance

Thomas Jackson - Corporate Finance

Andrew Monk - Corporate Broking

David Scriven - Corporate Broking

 

About Guanajuato Silver

GSilver is a precious metals producer engaged in reactivating past producing
silver and gold mines in central Mexico. The Company produces silver and gold
concentrates from the El Cubo Mine, Valenciana Mines Complex, and the San
Ignacio mine; all three mines are located within the state of Guanajuato,
which has an established 480-year mining history. Additionally, the Company
produces silver, gold, lead, and zinc concentrates from the Topia mine in
northwestern Durango. With four operating mines and three processing
facilities, Guanajuato Silver is one of the fastest growing silver producers
in Mexico.

 

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