SilverCrest Reports First Quarter 2023 Results

TSX: SIL | NYSE American: SILV

SilverCrest Metals Inc. ("SilverCrest" or the "Company") is pleased to announce its financial and Las Chispas Mine ("Las Chispas") operational results for the first quarter of 2023 ("Q1, 2023"). All amounts herein are presented in United States Dollars ("US$"), unless otherwise stated. Certain amounts shown in this news release may not total to exact amounts due to rounding differences.

SilverCrest Metals Inc. Logo (CNW Group/SilverCrest Metals Inc.)

N. Eric Fier , CEO, commented, "Marking another significant milestone for SilverCrest, Q1, 2023 was our first full quarter of production since Las Chispas was declared commercial in November 2022 . We generated $19.3 million of net free cash flow[1] allowing for accelerated debt prepayment of $25.0 million and a robust quarter end cash position of $45.8 million . As a testament to our strong financial position, execution and risk management, subsequent to Q1, 2023 we made an additional debt prepayment of $20 million and have now repaid 95% of our debt within six months of declaring commercial production. We remain focused on completion of the Updated Technical Report in late Q2, 2023 which will include updated costs, a new Life of Mine ("LOM") plan and allow for the inclusion of data from our initial production period. This report will provide us with the details to support production and cost guidance."

Q1, 2023 Financial Highlights

  • Sold a total of 14,200 ounces ("oz") of gold and 1.36 million oz of silver at average realized prices 1 of $1,879 per oz gold and $23.00 per oz silver.
  • Revenue of $58.0 million and cost of sales of $22.4 million , resulting in mine operating income of $35.6 million .
  • Income of $27.2 million or $0.18 per share.
  • Cash flow from operating activities before changes in non-cash working capital items of $35.5 million or $0.24 per share.
  • Cash costs 1 of $6.57 /oz silver equivalent 2 ("AgEq") sold and all-in sustaining cost ("AISC") 1 of $11.45 /oz AgEq sold.
  • Net free cash flow 1 of $19.3 million for $0.13 per share.
  • Repaid $25.0 million of debt in the quarter for total debt repayments of $65.0 million to the end of Q1, 2023.
  • Ended the quarter with cash of $45.8 million and net cash 1 of $21.0 million .

Q1, 2023 Operating Highlights

  • Underground production mining rates averaged 707 tonnes per day ("tpd") during Q1, 2023, slightly ahead of H1, 2023 expectations of 650-700 tpd, however development rates are tracking below expectations.
  • Average daily processing plant throughput of 1,160 tpd with an estimated 40% of production feed sourced from stockpiles during the quarter.
  • Processed grades increased from Q4, 2022, averaging 4.06 grams per tonne ("gpt") gold (3.67 gpt in Q4, 2022) and 419 gpt silver (382 gpt in Q4, 2022).
  • Metallurgical recoveries remained robust with an average gold recovery of 97.5% (96.9% in Q4, 2022) and average silver recovery of 91.9% (93.3% in Q4, 2022).
  • Recovered 13,300 ounces of gold and 1.29 million ounces of silver, or 2.45 million silver equivalent ounces.
  • Contract discussions are underway with mining contractors, including our current contractor, with a goal of finalizing negotiations in H2, 2023.

_____________________________

1 Average realized prices, net free cash flow, net cash, cash cost per AgEq ounce sold, AISC per ounce are non-IFRS financial measures. Non-IFRS financial measures are not standardized financial measures under IFRS and might not be comparable to similar financial measures disclosed by other companies. Please refer to the "NON-IFRS FINANCIAL MEASURES" section of this news release for additional information.

2 Silver equivalent (or "AgEq") is based on the 2021 Feasibility Study Mineral Resource and Reserve gold to silver ratio of 86.9:1.


Q1, 2023 Operational and Financial Highlights


Unit


Q1, 2023

Q4, 2022 (1)

Revenue

$ millions


58.0

40.8

Cost of sales

$ millions


(22.4)

(14.3)

Mine operating income

$ millions


35.6

26.5

Income for the period

$ millions


27.2

5.2

Income per share - basic

$/share


0.18

0.03

Net free cash flow

$ millions


19.3

N/A (2)

Cash costs

$/oz AgEq sold


6.57

N/A (2)

All-in sustaining costs ("AISC")

$/oz AgEq sold


11.45

N/A (2)


Unit


March 31,
2023

December 31,
2022

Cash and cash equivalents

$ millions


45.8‎‎

50.8

Credit Facility Debt

$ millions


(25.0)

(50.0)

Net cash

$ millions


21.0

1.2


Unit


Q1, 2023

Q4, 2022

Ore mined

tonnes


63,600

64,700

Ore milled (3)

tonnes


104,400

104,400

Average daily mill throughput

tpd


1,160

1,135






Gold (Au)





Average grade

gpt


4.06

3.67

Recovery

%


97.5

96.9

Recovered

oz


13,300

11,940

Sold

oz


14,200

11,400

Average realized price

$/oz


1,879

N/A (2)






Silver (Ag)





Average grade

gpt


419

382

Recovery

%


91.9

93.3

Recovered

million oz


1.29

1.20

Sold

million oz


1.36

0.98

Average realized price

$/oz


23.00

N/A (2)






Silver equivalent (AgEq) (4)





Recovered

million oz


2.45

2.23

(1) During Q4, 2022 the Company declared commercial production effective November 1, 2022

(2) This information was not available for Q4, 2022.

(3) Ore milled includes material from stockpiles and ore mined.

(4) Silver equivalent (or "AgEq") is based on the NI 43-101 Technical Report & Feasibility Study on the Las Chispas Project dated January 4, 2021 (the "2021 Feasibility Study") Mineral Resource and Reserve gold to silver ratio of 86.9:1.


Subsequent event
Subsequent to the end of Q1, 2023 the Company made prepayments totaling $20.0 million towards the term facility, reducing debt outstanding to $5.0 million .

Underground
In Q1, 2023 mining rates averaged 707 tpd, slightly above the expected range of 650-700 tpd for H1, 2023. The mine ramp-up beyond H1, 2023 will be defined in the Updated Technical Report. Mined grades in the quarter were estimated to average 4.18 gpt gold and 428 gpt silver.

Underground capital development is tracking behind plan by approximately 790 metres due to the delay of a ventilation raise and the shift to more operating development. This benefited the AISC in the quarter. The Company expects to accelerate sustaining capital development during the remainder of 2023 which will increase the amount of sustaining development included in AISC.

During the quarter, SilverCrest began contract discussions with underground mining contractors, including the current contractor. These discussions are expected to conclude in H2, 2023. As part of these ongoing discussions, SilverCrest expects to receive updated cost estimates that can be utilized in the Updated Technical Report for underground mining and development, which represent a significant portion of SilverCrest's cost structure.

Processing Plant
During Q1, 2023, the Las Chispas processing plant performed well. Quarterly throughput averaged 1,160 tpd with an estimated 40% of processing plant feed sourced from stockpiles. Average throughput was slightly below H1, 2023 planned rate of 1,200 tpd. Throughput and stockpile usage beyond H1, 2023 will be defined in the Updated Technical Report.

Processed gold and silver grades increased from Q4, 2022 levels as the percentage of lower grade stockpile feed was reduced. Gold grades averaged 4.06 gpt (3.67 gpt in Q4, 2022) and silver grades averaged 419 gpt (382 gpt in Q4, 2022). Gold recoveries increased from Q4, 2022 (97.5% vs. 96.9%) while silver recoveries declined (91.9% vs. 93.3%) due to some operating issues in the first half of January 2023 . These operating issues were corrected in January 2023 and silver recoveries have improved to levels above Q4, 2022.

13,300 oz of gold and 1.29 million oz of silver or 2.45 million silver equivalent oz were recovered in the quarter. It is expected that metal recovered in Q2, 2023 will be similar to levels in Q1, 2023.

Costs
During the quarter, cash costs averaged $6.57 /oz AgEq sold and project level AISC, which include Las Chispas exploration and site G&A averaged $10.09 /oz AgEq sold. Corporate level AISC which aligns with the World Gold Council definition of AISC averaged $11.45 /oz AgEq sold. These costs incorporate most of the inflationary impacts and mine site changes since the Feasibility Study costs were determined, more over than 2.5 year ago. The Updated Technical Report is expected to incorporate any other inflationary impacts and mine site changes.

As part of the Updated Technical Report, operating and sustaining capital costs will be updated to reflect cost increases experienced to date, as well as any potential additional costs related to the life of mine plan ("LOM"), updated mining contract, labour and consumables.

The Company's strategic decision to allocate capital towards developing a robust stockpile early in the project life has significantly de-risked the ramp-up and is expected to be a strong asset into 2024 and possibly beyond. As the percentage of processing throughput sourced from stockpiles declines, the benefit to the current cost structure will be impacted.

Exploration
Exploration activities at Las Chispas in Q1, 2023 remained focused on expansion drilling along known veins, target generation and review of exploration opportunities, which is ongoing both on site and regionally.

ESG
During the quarter there were no environmental incidents at Las Chispas.

The Company continued to progress its five-year water-related infrastructure projects in the community. In Q1, 2023 SilverCrest completed construction of a water intake valve and 500 metres of aqueducts which serve as key infrastructure to efficiently access water for the ranchers and farmers in our community. The next phase of these projects, as outlined in SilverCrest's Water Stewardship Report, will begin in Q2, 2023 with the refurbishment of additional aqueducts and continued replacement of deteriorating sections of the community sewage system. These projects will help support the key economic drivers of the communities in which the Company operates. SilverCrest's ESG initiatives have recently been recognized in Mexico through receipt of the 2023 ESR Socially Responsible Company® distinction, awarded by the Mexican Center for Philanthropy (CEMEFI).

SilverCrest remains on track to deliver an inaugural ESG report in Q2, 2023.

Updated Technical Report
SilverCrest remains on schedule to complete an Updated Technical Report in late Q2, 2023. This report will include updated resources and reserves, which will incorporate both increased infill drilling and data from underground operations, including reconciliation. The updated reserves will support refreshed operating and sustaining costs, and a new LOM plan which will consider the optimal mining, stockpile and processing rates.

Consolidated Financial Statements
This press release should be read in conjunction with SilverCrest's unaudited interim consolidated financial statements and management's discussion and analysis for the three months ended March 31, 2023 which are available on the Company's website at www.silvercrestmetals.com , and under the Company's profiles on SEDAR ( www.sedar.com ) and EDGAR ( www.sec.gov ).

First Quarter 2023 Conference Call
A conference call to discuss the Company's Q1, 2023 financial results will be held tomorrow Friday May 12 th at 8:00 a.m. PT / 11:00 p.m. ET . To participate in the conference call, please dial the numbers below.

Date & Time: Friday, May 12, 2023 at 11:00 a.m. ET / 8:00 a.m. PT

Telephone: Toronto : +1-416-764-8624
North America Toll Free: 1-888-259-6580
Conference ID: 36026049

Webcast:           https://silvercrestmetals.com/investors/events/

Qualified Persons Statement
The Qualified Person under National Instrument 43-101 Standards of Disclosure for Mineral Projects for this news release is N. Eric Fier , CPG, P.Eng, and CEO for SilverCrest, who has reviewed and approved its contents.

ABOUT SILVERCREST METALS INC.
SilverCrest is a Canadian precious metals producer headquartered in Vancouver, BC , with an ongoing initiative to increase its asset base by expanding current resources and reserves, acquiring, discovering and developing high value precious metals projects and ultimately operating multiple silver-gold mines in the Americas. The Company's principal focus is operating its Las Chispas Mine in Sonora, Mexico . The Company is led by a proven management team in all aspects of the precious metal mining sector, including taking projects through discovery, finance, on time and on budget construction, and production.

FORWARD-LOOKING STATEMENTS
This news release contains "forward-looking statements" and "forward-looking information" (collectively "forward-looking statements") within the meaning of applicable Canadian and United States securities legislation. These include, without limitation, statements with respect to: the strategic plans, timing and expectations for the Company completing a technical report update in Q2, 2023; providing updated costs and production guidance; optimizing the operation; and publishing its inaugural ESG report in Q2, 2023. Such forward looking statements or information are based on a number of assumptions, which may prove to be incorrect. Assumptions have been made regarding, among other things: present and future business strategies, continued commercial operations at the Las Chispas Mine, the environment in which the Company will operate in the future, including the price of gold and silver, estimates of capital and operating costs, production estimates, estimates of mineral resources and metallurgical recoveries and mining operational risk; the reliability of mineralization estimates, mining and development costs, the conditions in general economic and financial markets; availability of skilled labour; timing and amount of expenditures related to exploration programs; and effects of regulation by governmental agencies. The actual results could differ materially from those anticipated in these forward-looking statements as a result of risk factors including: the timing and content of work programs; results of exploration activities; the interpretation of drilling results and other geological data; receipt, maintenance and security of permits and mineral property titles; environmental and other regulatory risks; project cost overruns or unanticipated costs and expenses; fluctuations in gold and silver prices and general market and industry conditions. Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statements were made. The Company undertakes no obligation to update or revise any forward-looking statements included in this news release if these beliefs, estimates and opinions or other circumstances should change, except as otherwise required by applicable law.

N. Eric Fier , CPG, P.Eng
Chief Executive Officer
SilverCrest Metals Inc.

NON-IFRS FINANCIAL MEASURES

SilverCrest uses certain non-IFRS performance measures in this news release. Non-IFRS financial measures do not have any standardized meaning under IFRS and may not be comparable to similar measures presented by other issuers. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, management and certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Non-IFRS financial measures - Average realized gold and silver price
Average realized gold and silver price per ounce is calculated by dividing the Company's gross revenue from gold or silver sales for the relevant period by the gold or silver ounces sold, respectively. The Company believes the measure is useful in understanding the metal prices realized by the Company throughout the period. Average realized price per ounce sold is a common performance measure that does not have any standardized meaning. The most directly comparable measure prepared in accordance with IFRS is revenue from gold and silver sales. As Q1, 2023, is the first full quarter of production, no comparative period exists.



Q1, 2023

($ 000's, except per ounce amounts)



Revenues from financial statements


$       57,983

Ag sales


(31,307)

Au sales

A

26,676

Au oz sold during the period

B

14,200

Average realized Au price per oz sold

A/B

$         1,879




Revenues from financial statements


57,983

Au sales


(26,676)

Ag sales

A

31,307

Ag oz sold during the period

B

1,361,000

Average realized Ag price per oz sold

A/B

$         23.00


Non-IFRS financial measure - Net free cash flow
Net free cash flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS. SilverCrest calculates net free cash flow by deducting expenditures on mineral property, plant, and equipment from net cash provided by operating activities. Non-sustaining and growth capital activities are excluded. Net free cash flow is divided by the basic weighted average shares outstanding to get the net free cash flow per basic share. The Company believes that this measure provides valuable assistance to investors and analysts in evaluating the Company's ability to generate cash flow after capital investments and build the cash resources of the Company. The most directly comparable measure prepared in accordance with IFRS is net cash provided by operating activities less net cash used in investing activities. This differs from the Companies calculation as net cash used in investing activities is used in place of expenditures on mineral property, plant, and equipment. Net cash used in investing activities would include all cash inflows and outflows related to investing activities as per the consolidated statement of cash flows. As Q1, 2023, is the first full quarter of production, no comparative period exists.

Net free cash flow


Q1, 2023



$ 000's

Cash flow from operating activities


26,973

Sustaining capital expenditures


(7,653)

Net free cash flow

A

19,320

Weighted average shares outstanding - basic

B

147,200

Net free cash flow - basic per share

A/B

0.13




Sustaining capital expenditures


Q1, 2023



$ 000's

Expenditures on mineral property, plant, and equipment


(7,930)

Payment of lease liabilities


(43)

Non-sustaining and growth capital activities


320

Sustaining capital expenditures


(7,653)


Non-IFRS financial measure - Net Cash
SilverCrest calculates net cash by deducting debt from cash and cash equivalents as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, net cash is useful to evaluate the Company's and liquidity and capital resources.

Net Cash


March 31, 2023

December 31, 2022



$ 000's

$ 000's

Cash and cash equivalents


$             45,765

$             50,761

Debt


(24,811)

(49,591)

Net cash


$             20,954

$               1,170


Non-IFRS financial measure - Cash costs and cash cost per silver equivalent ounce
sold
The Company uses cash costs per ounce of precious metals sold to monitor its operating performance internally. The most directly comparable measure prepared in accordance with IFRS is cost of sales. The Company believes this measure provides investors and analysts with useful information about its underlying cash costs of operations. The Company also believes it is a relevant metric used to understand its operating profitability and ability to generate cash flow. Cash costs are measures developed by precious metals companies in an effort to provide a comparable standard; however, there can be no assurance that the Company's reporting of these non-IFRS financial measures are similar to those reported by other mining companies. They are widely reported in the silver mining industry as a benchmark for performance, but do not have a standardized meaning and are disclosed in addition to IFRS financial measures. Cash costs include production costs, refinery and transportation costs and extraordinary mining duty. Cash costs excludes non-cash depreciation and depletion and site share-based compensation. As Q1, 2023, is the first full quarter of production, no comparative period exists.

Cash costs per silver equivalent ounce is calculated by dividing cash costs by the silver equivalent ounces sold.

Non-IFRS financial measure - AISC and AISC per silver equivalent ounce sold
The Company defines AISC as the sum of total cash costs (as defined above); general and administrative expenses; share-based compensation; reclamation and closure provision depletion and accretion related to current operations; sustaining capital expenditures relating to current operations, including underground mine development and exploration and evaluation costs; and payments for leases. Corporate and allocated general and administrative expenses do not include non-cash depreciation. As this measure seeks to reflect the full cost of silver equivalent production from current operations, growth capital is excluded. Certain other cash expenditures, including tax payments and financing charges are also excluded. As Q1, 2023, is the first full quarter of production, no comparative period exists.

($ 000's, except per ounce amounts)


Q1, 2023

Cost of sales from financial statements


$        22,377

Less: depreciation and depletion


(4,045)

Less: site share-based compensation


(388)

Less: changes in inventories


(906)

Total cash costs


17,038

Add: site share-based compensation


388

Add: reclamation and closure provision - depletion and accretion


199

Add: sustaining capital expenditures


7,653

Add: changes in inventories


906

Total all-in sustaining costs at the project level


$        26,184

Add: corporate general and administrative expenses (including share-based compensation)


3,520

Total all-in sustaining costs


$        29,704




AgEq koz sold (86.9:1)


2,595

Total cash costs per oz sold


$            6.57

All-in sustaining costs per oz sold at the project level


$          10.09

All-in sustaining costs per oz sold


$          11.45

Cision View original content to download multimedia: https://www.prnewswire.com/news-releases/silvercrest-reports-first-quarter-2023-results-301822765.html

SOURCE SilverCrest Metals Inc.

Cision View original content to download multimedia: https://www.newswire.ca/en/releases/archive/May2023/11/c0705.html

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MAG Silver Corp. (TSX NYSE American: MAG) ("MAG", or the "Company") announces the Company's consolidated financial results for the year ended December 31, 2023. For details of the audited consolidated financial statements of the Company for the year ended December 31, 2023 ("2023 Financial Statements") and management's discussion and analysis for the year ended December 31, 2023 ("2023 MD&A"), please see the Company's filings on the System for Electronic Document Analysis and Retrieval Plus ("SEDAR+") at ( www.sedarplus.ca ) or on the Electronic Data Gathering, Analysis, and Retrieval ("EDGAR") at ( www.sec.gov ).

All amounts herein are reported in $000s of United States dollars ("US$") unless otherwise specified (C$ refers to Canadian dollars).

KEY HIGHLIGHTS (on a 100% basis unless otherwise noted)

  • MAG reported net income of $48,659 ($0.47 per share) driven by income from Juanicipio (equity accounted) of $65,099 and Adjusted EBITDA 1 of $97,480 for the year ended December 31, 2023.

  • MAG reported net income of $15,694 ($0.15 per share) driven by income from Juanicipio (equity accounted) of $21,069 and Adjusted EBITDA 1 of $29,787 for the three months ended December 31, 2023.

  • A total of 346,766 tonnes of mineralized material at a silver head grade of 467 grams per tonne ("g/t") was processed at Juanicipio during the fourth quarter. Milling performance for 2023 totalled 1,268,757 tonnes at a head grade of 472 g/t.

  • Juanicipio achieved silver production of 4.5 million ounces during the fourth quarter. Silver production for 2023 totalled 16.8 million ounces.

  • Juanicipio continued to capitalize on available milling capacity at the Saucito plant (100% Fresnillo owned) to maintain processing rates during periods of maintenance. Approximately 5% of the material processed during the fourth quarter was processed through the Saucito plant.

  • Juanicipio delivered robust cost performance with cash cost 2 of $3.76 per silver ounce sold and all-in sustaining cost 2 of $9.17 per silver ounce sold in the fourth quarter.
  • Juanicipio generated strong operating cash flow of $84,038 and free cash flow 2 of $61,993 in the fourth quarter. Operating cash flow and free cash flow 2 for 2023 totalled $145,064 and $60,814, respectively.

  • At the end of the year, Juanicipio held cash balances of $42,913, representing an increase of $41,811 over 2022, driven by strong operating cash flows.

  • Juanicipio returned a total of $18,765 in interest and loan principal repayments to MAG during the fourth quarter. Interest and loan principal repayments returned to MAG during 2023 totalled $33,354.

  • MAG concluded a $40,000 senior secured revolving credit facility (the "Credit Facility") with the Bank of Montreal on October 4, 2023.

  • Effective June 20, 2023, MAG was included in the NYSE Arca Gold Miners Index which is tracked by the VanEck Vectors Gold Miners ETF.

CORPORATE

  • In September the Company published its second annual sustainability report underscoring its commitment to transparency with its stakeholders while providing a comprehensive overview of the Company's environmental, social and governance ("ESG") commitments, practices and performance for the 2022 year. The 2022 sustainability report is supported by the MAG Silver 2022 ESG Data Table which discloses MAG's historical ESG performance data.

  • During early 2024, as part of the Company's longer term succession planning, Dr. Lex Lambeck was promoted to the position of Vice President, Exploration. Lex has been the project manager for the Deer Trail Project in Utah since it was acquired by MAG in 2019, led by Dr. Peter Megaw. Lex's leadership was instrumental in the application of the "Hub and Spoke" thesis at Deer Trail as well as the Carissa discovery demonstrating his strong skills in generative exploration in district scale settings which will be invaluable in overseeing the Company's portfolio of exploration properties, including exploration at Juanicipio.

  • Marc Turcotte, with his almost 10 years experience at MAG as Vice President, Corporate Development, was promoted to the position of Chief Development Officer. In this broader executive role, Marc will leverage his proven track record in identifying unique situations to zero-in-on and assess inorganic growth opportunities aligned with the Company's commitment to continued Tier-1 growth and expansion. Marc was the architect of the consolidation of the Deer Trail project in Utah as well as the catalyst behind the acquisition of Gatling Exploration which brought the Larder project into MAG's portfolio of high quality, high impact exploration properties.

  • Tom Peregoodoff was appointed to the Board of Directors of MAG effective January 1, 2024. Mr. Peregoodoff will fill the vacancy to be created by the planned retirement in June 2024 of Dan MacInnis, who does not plan to seek re-election at the Company's 2024 annual general meeting of shareholders. Tom brings with him over 30 years of industry knowledge and leadership and has extensive experience in all aspects and stages of the global mining business, specializing in mineral exploration.

EXPLORATION

  • Juanicipio:
    • Infill drilling at Juanicipio continued in 2023, with one rig on surface and one underground with the goal of upgrading and expanding the Valdecañas Vein System at depth and further defining areas to be mined in the near to mid-term.
    • During 2023, 13,273 metres (three months ended December 31, 2023: nil metres) and 22,015 metres (three months ended December 31, 2023: 6,686 metres), were drilled from surface and underground respectively. Drilling for the year, both surface and underground, was infill in nature and continues to confirm defined mineralization.

  • Deer Trail Project, Utah:
    • Results from the 12,157 metres in surface-based Phase 2 drilling on the Deer Trail Carbonate Replacement Deposit project were reported on January 17, 2023 and August 3, 2023 (see news releases dated January 17, 2023 and August 3, 2023 available under the Company's SEDAR+ profile at www.sedarplus.ca ).
    • On May 29, 2023 MAG started a Phase 3 drilling program focused on up to three porphyry "hub" targets thought to be the source of the manto, skarn and epithermal mineralization and extensive alteration throughout the project area including that at the Deer Trail and Carissa zones. An early onset of winter snowfall impacted the commencement of the third porphyry "hub" target which is expected to be drilled next season and drilling has shifted to offset the Carissa discovery and test other high-potential targets.
    • During 2023, 5,525 metres (three months ended December 31, 2023: 1,609 metres) were drilled at high elevation with final results and interpretation pending.

  • Larder Project, Ontario:
    • On July 12, 2023 drilling resumed at the Larder Project to test additional targets by the end of the year on the Cheminis and Bear areas. During 2023 17,504 metres were drilled at Swansea, Cheminis and Bear.
    • Cheminis Success: The magnetotellurics survey carried out in the summer of 2023 enabled modelling of the south volcanic gold zone at Cheminis and is proving to be applicable elsewhere across the property. Drilling in three successive Cheminis drillholes (GAT-23-019, 020A, and 021B, see Table 1 below) intersected grades of 1.1 to 20.3 g/t gold over core lengths of 0.6 - 11.1 metres demonstrating continuity. This also extended the gold-hosting mine sequence down to 700 metres below surface, more than 370 metres below the deepest workings in this portion of the Cadillac-Larder Break. Incorporating these results into the model should enhance predictability in follow-up drilling.
    • Bear Success: Increased predictability has led to continued success and further definition of the North Bear zone, especially in hole GAT-23-022NA (see Table 1 below) which cut 5.1 metres grading 4.6 g/t gold (including a high-grade zone of 1.4 metre grading 16.2 g/t gold). These intercepts extend gold mineralization to 650 metres below surface, and it remains open in all directions.

Table 1: 2023 Larder Drillholes Highlights

Hole ID From (m) To (m) Length (m) 1 Gold (g/t) Lithology Target/Zone
GAT-23-019 767.00 776.50 9.50 2.1 Mafic Volcanics South Cheminis Mine Sequence Zone
Including 767.40 768.80 1.40 5.1 South Volcanics South Cheminis Mine Sequence Zone
Including 767.80 768.00 0.30 11.0 South Volcanics South Cheminis Mine Sequence Zone
and 945.00 955.00 10.00 1.1 Green Komatiites North Cheminis Zone
Including 946.00 949.50 3.50 2.1 Green Komatiites North Cheminis Zone
GAT-23-020A 605.30 605.90 0.60 9.4 Quartz Vein & South Volcanics South Cheminis Zone
and 672.90 678.80 5.90 3.5 Komatiite-Syenite Contact North Cheminis Zone
Including 676.30 678.80 2.50 6.3 Komatiite-Syenite Contact North Cheminis Zone
Including 678.30 678.80 0.50 20.3 Green Komatiite-Syenite Contact North Cheminis Zone
GAT-23-021B 757.40 768.50 11.10 3.2 Brecciated South Volcanics with Graphite South Cheminis Mine Sequence Zone
Including 766.00 768.00 2.00 10.2 South Volcanics South Cheminis Mine Sequence Zone
GAT-23-022NA 784.60 785.50 0.90 6.0 Green Komatiites North Bear Zone
and 789.50 794.60 5.10 4.6 Green Komatiite with Graphite North Bear Zone
Including 790.30 791.70 1.40 16.2 Quartz Vein with Graphite North Bear Zone
Including 791.20 793.70 0.50 33.8 Quartz Vein with Graphite North Bear Zone
and 939.50 940.20 0.70 5.7 South Volcanics South Bear Zone


JUANICIPIO RESULTS

All results of Juanicipio in this section are on a 100% basis, unless otherwise noted.

Operating Performance

The following table and subsequent discussion provide a summary of the operating performance of Juanicipio for the years ended December 31, 2023 and 2022, unless otherwise noted.

Key mine performance data of Juanicipio (100% basis) Year ended
December 31, December 31,
2023 2022
Metres developed (m) 14,864 12,999
Material mined (t) 1,097,289 792,693
Material processed (t) 1,268,757 646,148
Silver head grade (g/t) 472 520
Gold head grade (g/t) 1.27 1.39
Lead head grade (%) 1.14 % 0.90 %
Zinc head grade (%) 2.05 % 1.72 %
Silver payable ounces (koz) 15,318 8,697
Gold payable ounces (koz) 31.73 20.27
Lead payable pounds (klb) 25,862 9,892
Zinc payable pounds (klb) 36,881 14,898

During the year ended December 31, 2023 a total of 1,097,289 tonnes of mineralized material were mined. This represents an increase of 38% over 2022. Increases in mined tonnages at Juanicipio have been driven by the operational ramp up of the milling facility.

During the year ended December 31, 2023 a total of 1,268,757 tonnes of mineralized material were processed through the Juanicipio, Saucito and Fresnillo plants. This represents an increase of 96% over 2022. The increase in milled tonnage has been driven by the Juanicipio mill commissioning and operational ramp up. As reported by the operator, Fresnillo, the Juanicipio processing facility achieved nameplate capacity of 4,000 tpd during September 2023 with silver recovery consistently above 88%. Juanicipio continued to capitalize on available milling capacity at the Saucito plant (100% Fresnillo owned) to maintain processing rates during periods of maintenance. Approximately 5% of the material processed during the fourth quarter of 2023 was processed through the Saucito plant.

The average silver head grade for the mineralized material processed in the year ended December 31, 2023 was 472 g/t (year ended December 31, 2022: 520 g/t).

The following table provides a summary of the total cash costs (1) and all-in-sustaining costs ("AISC") (1) of Juanicipio for the years ended December 31, 2023, and 2022.

Key mine performance data of Juanicipio (100% basis) Year ended
December 31, December 31,
2023 2022
Total operating cash costs (1) 88,080 40,522
Operating cash cost per silver ounce sold ($/oz) (1) 5.75 4.66
Total cash costs (1) 93,025 40,871
Cash cost per silver ounce sold ($/oz) (1) 6.07 4.70
All-in sustaining costs (1) 158,151 83,463
All-in sustaining cost per silver ounce sold ($/oz) (1) 10.32 9.60

(1) Total operating cash costs, operating cash cost per ounce, total cash costs, cash cost per ounce, all-in sustaining costs, and all-in sustaining cost per ounce are non-IFRS measures, please see below ‘ Non-IFRS Measures ' section and section 12 of the 2023 MD&A dated March 18, 2024, available on SEDAR+ at www.sedarplus.ca for a detailed reconciliation of these measures to the 2023 Financial Statements.


Financial Results

The following table presents excerpts of the financial results of Juanicipio for the years ended December 31, 2023 and 2022 (MAG's share of income from its equity accounted investment in Juanicipio).

Year ended
December 31, December 31,
2023 2022
$ $
Sales 442,288 215,736
Cost of sales:
Production cost (171,830 ) (61,985 )
Depreciation and amortization (68,475 ) (20,913 )
Gross profit 201,983 132,838
Consulting and administrative expenses (18,768 ) (8,436 )
Extraordinary mining and other duties (4,945 ) (349 )
Interest expense (18,524 ) (2,298 )
Exchange losses and other (2,937 ) (5,160 )
Net income before tax 156,809 116,595
Income tax expense (27,381 ) (26,348 )
Net income (100% basis) 129,428 90,247
MAG's 44% portion of net income 56,948 39,709
Interest on Juanicipio loans - MAG's 44% 8,150 1,058
MAG's 44% equity income 65,099 40,767

Sales increased by $226,552 during the year ended December 31, 2023, mainly due to 84% higher metal volumes and 5% higher realized metal prices.

Offsetting higher sales was higher depreciation ($47,561) as the Juanicipio mill achieved commercial production and commenced depreciating the processing facility and associated equipment, and higher production cost ($109,845) which was driven by higher sales and operational ramp-up in mining and processing, including $44,027 in inventory movements as commissioning stockpiles were drawn down.

Other expenses increased by $28,932 mainly as a result of higher extraordinary mining and other duties ($4,596) related to higher precious metal revenues from the sale of concentrates, higher consulting and administrative expenses ($10,332) as an operator services agreement became effective upon initiation of commercial production whereby Fresnillo and its affiliates continue to operate the mine, and higher interest incurred on shareholder loans ($16,227) which were completely expensed during 2023, whereas being only partly expensed with the rest capitalized to construction in progress during 2022.

Taxes increased by $1,033 impacted by deferred tax charges associated with fixed assets as well as higher taxable profits generated during the period.

Mineralized Material Processed at Juanicipio, Saucito and Fresnillo Plants (100% basis)

Year Ended December 31, 2023 (1,268,757 tonnes processed) Year Ended
December 31, 2022
Amount

$
Payable Metals Quantity Average Price
$
Amount
$
Silver 15,317,765 ounces 23.66 per oz 362,457 188,722
Gold 31,735 ounces 1,978.07 per oz 62,774 36,958
Lead 11,731 tonnes 0.96 per lb. 24,746 9,380
Zinc 16,729 tonnes 1.15 per lb. 42,496 23,398
Treatment, refining, and other processing costs ( 2 ) (50,185 ) (42,722 )
Sales 442,288 215,736
Production cost (171,830 ) (61,985 )
Depreciation and amortization (1) (68,475 ) (20,913 )
Gross Profit 201,983 132,838

(1) The underground mine was considered readied for its intended use on January 1, 2022, whereas the Juanicipio processing facility started commissioning and ramp-up activities in January 2023, achieving commercial production status on June 1, 2023.
(2) Includes toll milling costs from processing mineralized material at the Saucito and Fresnillo plants.


Sales and treatment charges are recorded on a provisional basis and are adjusted based on final assay and pricing adjustments in accordance with the offtake contracts.

MAG FINANCIAL RESULTS – YEAR ENDED DECEMBER 31, 2023

As at December 31, 2023, MAG had working capital of $67,262 (December 31, 2022: $29,232) including cash of $68,707 (December 31, 2022: $29,955) and no long-term debt. As well, as at December 31, 2023, Juanicipio had working capital of $86,336 including cash of $42,913 (MAG's attributable share is 44%).

The Company's net income for the year ended December 31, 2023 amounted to $48,659 (December 31, 2022: $17,644) or $0.47/share (December 31, 2022: $0.18/share). MAG recorded its 44% income from equity accounted investment in Juanicipio of $65,099 (December 31, 2022: $40,767) which included MAG's 44% share of net income from operations as well as loan interest earned on loans advanced to Juanicipio (see above for MAG's share of income from its equity accounted investment in Juanicipio).

December 31, December 31,
2023 2022
$ $
Income from equity accounted investment in Juanicipio 65,099 40,767
General and administrative expenses (13,594 ) (12,352 )
General exploration and business development (736 ) (193 )
Exploration and evaluation assets written down - (10,471 )
Operating Income 50,769 17,751
Interest income 2,594 630
Other income 1,017 -
Foreign exchange loss (144 ) (366 )
Income before income tax 54,236 18,015
Deferred income tax expense (5,577 ) (371 )
Net income 48,659 17,644

NON-IFRS MEASURES

The following table provides a reconciliation of operating cash cost and cash cost per silver ounce of Juanicipio to production cost of Juanicipio on a 100% basis (the nearest IFRS measure) as presented in the notes to the 2023 Financial Statements.

Year ended December 31,
(in thousands of US$, except per ounce amounts) 2023 2022
Production cost as reported 171,830 61,985
Depreciation on inventory movements (3,919 ) 5,551
Adjusted production cost 167,911 67,536
Treatment, refining, and other processing costs 50,185 42,722
By-product revenues (2) (130,016 ) (69,736 )
Total operating cash costs (1) 88,080 40,522
Extraordinary mining and other duties 4,945 349
Total cash costs (1) 93,025 40,871
Silver ounces sold 15,317,765 8,697,372
Operating cash cost per silver ounce sold ($/ounce) 5.75 4.66
Cash cost per silver ounce sold ($/ounce) 6.07 4.70

(1) As Q3 2023 represented the first full quarter of commercial production, information presented for total operating cash costs and total cash costs together with their associated per unit values are not directly comparable.
(2) By-product revenues relates to the sale of other metals contained in the lead and zinc concentrates produced and delivered, namely gold, lead, and zinc.


The following table provides a reconciliation of AISC of Juanicipio to production cost and various operating expenses of Juanicipio on a 100% basis (the nearest IFRS measure), as presented in the notes to the 2023 Financial Statements.

Year ended December 31,
(in thousands of US$, except per ounce amounts) 2023 2022
Total cash costs 93,025 40,871
General and administrative expenses 18,768 8,436
Exploration 7,575 7,824
Sustaining capital expenditures 37,728 25,268
Sustaining lease payments 856 854
Interest on lease liabilities (48 ) (23 )
Accretion on closure and reclamation costs 247 232
All-in sustaining costs (1) 158,151 83,463
Silver ounces sold 15,317,765 8,697,372
All-in sustaining cost per silver ounce sold ($/ounce) 10.32 9.60
Average realized price per silver ounce sold ($/ounce) 23.66 21.70
All-in sustaining margin ($/ounce) 13.34 12.10
All-in sustaining margin 204,306 105,259

(1) As Q3 2023 represented the first full quarter of commercial production, information presented for all-in sustaining costs and all-in sustaining margin together with their associated per unit values are not directly comparable.


For the year ended December 31, 2023 the Company incurred corporate general and administrative expenses of $13,242 (year ended December 31, 2022: $12,216), which exclude depreciation expense.

The Company's attributable silver ounces sold for the year ended December 31, 2023 were 6,739,817 (year ended December 31, 2022: 3,826,844), resulting in additional AISC for the Company of $1.96/oz (year ended December 31, 2022: $3.19/oz), in addition to Juanicipio's AISC presented in the above table.

The following table provides a reconciliation of Earnings before interest, tax, depreciation and amortization ("EBITDA") and Adjusted EBITDA attributable to the Company based on its economic interest in Juanicipio to net income (the nearest IFRS measure) of the Company per the 2023 Financial Statements. All adjustments are shown net of estimated income tax.

Year ended December 31,
(in thousands of US$) 2023 2022
Net income after tax 48,659 17,644
Add back (deduct):
Taxes 5,577 371
Depreciation and depletion 352 136
Finance costs (income and expenses) (3,467 ) (264 )
EBITDA (1) 51,121 17,887
Add back (deduct):
Adjustment for non-cash share-based compensation 2,894 3,250
Exploration property write-down - 10,471
Share of net earnings related to Juanicipio (65,099 ) (40,767 )
MAG attributable interest in Junicipio Adjusted EBITDA 108,564 65,403
Adjusted EBITDA (1) 97,480 56,244

(1) As Q3 2023 represents the first full quarter of commercial production, information presented for EBITDA and Adjusted EBITDA is not directly comparable.


The following table provides a reconciliation of free cash flow of Juanicipio to its cash flow from operating activities on a 100% basis (the nearest IFRS measure), as presented in the notes to the 2023 Financial Statements.

Year ended December 31,
(in thousands of US$) 2023 2022
Cash flow from operating activities 145,064 129,261
Less:
Cash flow used in investing activities (83,393 ) (155,758 )
Sustaining lease payments (856 ) (854 )
Juanicipio free cash flow (1) 60,814 (27,351 )

(1) As Q3 2023 represents the first full quarter of commercial production, comparative information presented for free cash flow of Juanicipio is not directly comparable.


Qualified Persons:
All scientific or technical information in this press release including assay results referred to, and mineral resource estimates, if applicable, is based upon information prepared by or under the supervision of, or has been approved by Dr. Peter Megaw, Ph.D., CPG, MAG's Chief Exploration Officer and Gary Methven, P.Eng., Vice President, Technical Services; both are "Qualified Persons" for purposes of National Instrument 43-101, Standards of Disclosure for Mineral Projects .

About MAG Silver Corp.

MAG Silver Corp. is a growth-oriented Canadian exploration company focused on advancing high-grade, district scale precious metals projects in the Americas. MAG is emerging as a top-tier primary silver mining company through its (44%) joint venture interest in the 4,000 tonnes per day Juanicipio Mine, operated by Fresnillo plc (56%). The mine is located in the Fresnillo Silver Trend in Mexico, the world's premier silver mining camp, where in addition to underground mine production and processing of high-grade mineralised material, an expanded exploration program is in place targeting multiple highly prospective targets. MAG is also executing multi-phase exploration programs at the 100% earn-in Deer Trail Project in Utah and the 100% owned Larder Project, located in the historically prolific Abitibi region of Canada.

Neither the Toronto Stock Exchange nor the NYSE American has reviewed or accepted responsibility for the accuracy or adequacy of this press release, which has been prepared by management.

Certain information contained in this release, including any information relating to MAG's future oriented financial information, are "forward-looking information" and "forward-looking statements" within the meaning of applicable Canadian and United States securities legislation (collectively herein referred as "forward-looking statements"), including the "safe harbour" provisions of provincial securities legislation, the U.S. Private Securities Litigation Reform Act of 1995, Section 21E of the U.S. Securities Exchange Act of 1934, as amended and Section 27A of the U.S. Securities Act. Such forward-looking statements include, but are not limited to:

  • statements that address achieving the nameplate 4,000 tpd milling rate at Juanicipio;
  • statements that address our expectations regarding exploration and drilling;
  • statements regarding production expectations and nameplate;
  • statements regarding the additional information from future drill programs;
  • estimated future exploration and development operations and corresponding expenditures and other expenses for specific operations;
  • the expected capital, sustaining capital and working capital requirements at Juanicipio, including the potential for additional cash calls;
  • expected upside from additional exploration;
  • expected results from Deer Trail Project Phase 3 drilling;
  • expected results from the Larder Project at the Cheminis zone;
  • expected capital requirements and sources of funding; and
  • other future events or developments.

When used in this release, any statements that express or involve discussions with respect to predictions, beliefs, plans, projections, objectives, assumptions or future events of performance (often but not always using words or phrases such as "anticipate", "believe", "estimate", "expect", "intend", "plan", "strategy", "goals", "objectives", "project", "potential" or variations thereof or stating that certain actions, events, or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions), as they relate to the Company or management, are intended to identify forward-looking statements. Such statements reflect the Company's current views with respect to future events and are subject to certain known and unknown risks, uncertainties and assumptions.

Forward-looking statements are necessarily based upon estimates and assumptions, which are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control and many of which, regarding future business decisions, are subject to change. Assumptions underlying the Company's expectations regarding forward-looking statements contained in this release include, among others: MAG's ability to carry on its various exploration and development activities including project development timelines, the timely receipt of required approvals and permits, the price of the minerals produced, the costs of operating, exploration and development expenditures, the impact on operations of the Mexican tax and legal regimes, MAG's ability to obtain adequate financing, outbreaks or threat of an outbreak of a virus or other contagions or epidemic disease will be adequately responded to locally, nationally, regionally and internationally.

Although MAG believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements including amongst others: commodities prices; changes in expected mineral production performance; unexpected increases in capital costs or cost overruns; exploitation and exploration results; continued availability of capital and financing; general economic, market or business conditions; risks relating to the Company's business operations; risks relating to the financing of the Company's business operations; risks related to the Company's ability to comply with restrictive covenants and maintain financial covenants pursuant to the terms of the Credit Facility; the expected use of the Credit Facility; risks relating to the development of Juanicipio and the minority interest investment in the same; risks relating to the Company's property titles; risks related to receipt of required regulatory approvals; pandemic risks; supply chain constraints and general costs escalation in the current inflationary environment heightened by the invasion of Ukraine by Russia and the events relating to the Israel-Hamas war; risks relating to the Company's financial and other instruments; operational risk; environmental risk; political risk; currency risk; market risk; capital cost inflation risk; risk relating to construction delays; the risk that data is incomplete or inaccurate; the risks relating to the limitations and assumptions within drilling, engineering and socio-economic studies relied upon in preparing economic assessments and estimates, including the 2017 PEA; as well as those risks more particularly described under the heading "Risk Factors" in the Company's Annual Information Form dated March 27, 2023 available under the Company's profile on SEDAR+ at www.sedarplus.ca .

Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. The Company's forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made and, other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements if circumstances or management's beliefs, expectations or opinions should change. For the reasons set forth above, investors should not attribute undue certainty to or place undue reliance on forward-looking statements.

Please Note: Investors are urged to consider closely the disclosures in MAG's annual and quarterly reports and other public filings, accessible through the Internet at www.sedarplus.ca and www.sec.gov .

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