Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) reports that it has paid down $40 million of its revolving credit facility at the end of the third quarter of 2023, using cash on hand.

As at June 30, 2023, Fortuna reported a leverage ratio¹ of 0.9 times total net debt² to adjusted EBITDA³. After the payment of $40 million, it is expected that the Company’s total outstanding debt balance will stand at approximately $206 million on its credit facility (excluding letters of credit), and approximately $46 million of convertible notes, for an estimated total net debt, after cash and cash equivalents, of $133 million as at the end of the third quarter of 2023. This represents a reduction of approximately $65 million in total net debt in the period reflecting increased cash flows from the contribution of the Séguéla Mine in its first full quarter of production.

With operational and financial results weighted towards the second half of 2023 following the successful completion of a two-year intensive capital investment phase at Séguéla, the Company intends to shift its capital allocation priorities towards debt repayment, the continued advancement of its high-value exploration opportunities in the portfolio and will evaluate other initiatives to enhance shareholder value.

The estimated total net debt and liquidity for Fortuna as at the end of the third quarter of 2023 is preliminary financial information and has been prepared by management and remains subject to final review by the Company’s audit committee and approval by the Company’s board of directors. Such preliminary financial information for the third quarter of 2023 is subject to the finalization and closing of Fortuna’s accounting books and records for the period. Refer to the “Cautionary Statements” section at the end of this news release.

It is expected that the Company will release its financial statements and management’s discussion and analysis as at and for the three and nine months ended September 30, 2023, as approved by its audit committee and board of directors, on Wednesday, November 8, 2023, after market close.

Notes:

1. Total net debt to adjusted EBITDA is a non-IFRS ratio; refer to the “Non-IFRS Measures” section at the end of this news release for a description of this non-IFRS ratio and the reconciliation from debt, the most comparable IFRS measure
2. Total net debt is a non-IFRS measure; refer to the “Non-IFRS Measures” section at the end of this news release for a description of this non-IFRS measure and a reconciliation to debt, the most comparable IFRS measure
3. Adjusted EBITDA is a non-IFRS measure; refer to the “Non-IFRS Financial Measures” section in the Company’s management discussion and analysis for the three and six months ended June 30, 2023 (“Q2 2023 MD&A”), for a description of the measure on page 27 and for a reconciliation to net income the most directly comparable IFRS measure on page 36, and which aforementioned sections are incorporated by reference herein. The Q2 2023 MD&A may be accessed on SEDAR+ at www.sedarplus.ca under the Company’s profile

About Fortuna Silver Mines Inc.

Fortuna Silver Mines Inc. is a Canadian precious metals mining company with five operating mines in Argentina, Burkina Faso, Côte d’Ivoire, Mexico, and Peru. Sustainability is integral to all our operations and relationships. We produce gold and silver and generate shared value over the long-term for our stakeholders through efficient production, environmental protection, and social responsibility.