Realizes a 12% Production Increase Over Q4

Guanajuato Silver Company Ltd. (TSX-V:GSVR) (AQUIS:GSVR) (OTCQX:GSVRF) is pleased to announce consolidated production results for the three months ended March 31, 2023. Production results are generated from the Company’s wholly owned El Cubo Mines Complex, Valenciana Mines Complex, and San Ignacio Mine in Guanajuato, Mexico, and the Topia Mine in Durango, Mexico.

Q1 2023 Production Highlights

• Record production during the quarter of 938,047 silver-equivalent 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; the ramp-up across all four of our silver mines continues to generate quarter-over-quarter production increases.
• Underground hydraulic fill tailings system successfully implemented at VMC; Tailings material is now being deposited underground in one of the numerous voids that have been created over Valenciana’s 450-year mining history.
• Topia processing capacity increased approximately 10% due primarily to the optimization of a new tailings filter press. Also at Topia, the widening of the Victoria Tunnel has been initiated; once completed, this 2.5km long tunnel will bring access to the lower areas of the Argentina vein, which is the most important vein system in the district and is the principle structure mined at Topia for over 40 years; At least three additional veins will be accessed for production with this tunnel.
• Principal central maintenance shop has been completed in Guanajuato, and is now fully operational; the Company estimates that over US$1 million has been saved through the refurbishment of discarded and neglected equipment recently acquired through the MMR transaction.
• Production guidance for 2023 remains unchanged; silver equivalent production is expected to range from 4.6 to 4.8 million ounces.

“It is our mission to consistently achieve our stated production goals, and in the First Quarter we did just that. Record production of precious metals in Q1 puts us on the right course for 2023 as we look to continue the ramp-up phase across all of our producing assets,” said James Anderson, Chairman & CEO.

Q1 2023 Mine Operations Continue Trend of Quarter over Quarter Production Increases:

• Consolidated silver production increased 14% to 458,803 ounces in Q1 2023 compared to Q4 2022; similarly, consolidated gold production increased by 13% to 4,413 ounces over the same period.
• In Durango, consolidated lead production at the Topia mine increased 12% to 906,696 pounds in Q1 2023 compared to Q4 2022; consolidated zinc production decreased 8.5% to 1,153,138 pounds over the same period.
• Consolidated silver equivalent production in Q1 2023 was 12% higher than the previous quarter; this increase reflects the continuing ramp-up of operations at all of Guanajuato Silver’s mining assets.

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; 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 a 80:1 (Ag/Au) ratio for Q1 2022 and Q4 2021, respectively.

Incentive Compensation:

The Company announces the granting of stock options and restricted share units to select officers, directors, employees and consultants under the Company’s stock option plan and omnibus equity compensation plan, respectively.

The Company has granted stock options under its stock option plan to purchase up to an aggregate of 3.4 million common shares of the Company. The stock options will be exercisable for a term of five years at a price per share equal to today’s closing price of the Company’s common shares on the TSX Venture Exchange, subject to vesting on the basis of one-third on the date of grant, one third after 12 months and one-third after 24 months.

In addition, the Company has granted an aggregate of up to 400,000 RSUs, with one-half vesting after six months and the remaining half after 12 months. Each RSU entitles the holder to receive, upon vesting, one common share of the Company.

The Company has also arranged, subject to acceptance of the TSX Venture Exchange, to settle an outstanding advisory fee of $47,250 to Canaccord Genuity Corp. for common shares of the Company based on deemed price per share equal to today’s closing price of the Company’s common shares on the TSXV. All shares issued to Canaccord pursuant to the debt settlement will be subject to a statutory hold period of four months and a day from the date of issue in accordance with applicable securities legislation.

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 Mines Complex, 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.

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.