Q2 Production of 337,760 Silver Equivalent ounces

Guanajuato Silver Company Ltd. (TSX-V:GSVR) (OTCQX:GSVRF) is pleased to announce financial and operating results for the three months ended June 30, 2022. All dollar amounts are expressed in US dollars. Production results are from the Company’s wholly owned El Cubo Mine Complex and El Pinguico project in Guanajuato, Mexico.

“Month over month improvements in precious metals production, recoveries, and tonnes milled during Q2 were the hallmarks of a positive trend that we see continuing through the remainder of the year as we complete the ramp-up phase at El Cubo,” said James Anderson, Chairman and CEO of Guanajuato Silver. “We remain on-track to accomplish all of our original objectives at El Cubo as we now look to our Mexican operations teams to mirror the same success at our newly acquired mining assets of San Ignacio, Valenciana, and Topia, where production activities have already begun; the details of which will be discussed in a subsequent news release.”

Q2 2022 – Demonstrating Month over Month Operations Improvements

1. Silver equivalents are calculated using an average of 83.4:1 (Ag/Au) ratio for the second quarter of 2022.

Q2 2022 Selected Highlights

• Increasing production: 155,912 ounces of silver and 2,161 oz of gold for 337,760 oz silver equivalent¹ , representing a 22% increase over Q1.
• Milled tonnage increasing with significant capacity still available: In Q2, 94,212 tonnes were milled at El Cubo; the average rate for the quarter was approximately 30,000 tonnes per month, which is well below El Cubo’s maximum milling capacity of over 45,000 tonnes per month. Therefore, El Cubo has abundant capacity available to accommodate mineralized material from the recently purchased San Ignacio and Valenciana Mines Complex ( See GSilver news release dated August 4, 2022 – GSilver Closes Acquisition of Great Panther’s Mexican Mining Assets ).
• Cash cost per AgEq ounce produced continues to improve: Cash costs ² were 16% lower in Q2 at $16.98 compared to $20.12 for Q1, 2022. This result was in-line with expectations; improving costs per AgEq ounce produced is primarily due to increasing optimization of operations at the Villalpando and Santa Cecilia mine areas of El Cubo. AISC per AgEq ounce produced was also lower by 6% , which was also in-line with Company projections.
• Revenue marginally lower: Q2 revenue of $6,133,989 was 4% lower compared to Q1; this was largely reflective of a 6% decrease in silver prices over the same period.

1. Silver equivalents are calculated using an 83.4:1 (Ag/Au) ratio for Q2 2022 and 80:1 for Q1 2022 and Q4 2021 respectively.
2. The Company reports non-IFRS performance measures which include cash costs per silver equivalent ounce produced, all-in sustaining cost per silver equivalent ounce produced, total production cost per tonne, realized silver price per ounce sold, realized gold price per ounce sold, working capital and EBITDA. These measures are widely used in the mining industry as a benchmark for performance, but do not have a standardized meaning under IFRS and the methods used by the Company to calculate such measures may differ from methods used by other companies with similar descriptions. For a complete description of how the Company calculates such measures and a reconciliation of certain measures to IFRS terms please see the applicable description in the Company’s management discussion and analysis for the three months ended June 30, 2022, filed on SEDAR at www.sedar.com .
3. Based on provisional sales before final price adjustments, before payable metal deductions, treatment, and refining charges.

The complete interim financial statements and management’s discussion & analysis for the three months ended June 30, 2022, can be viewed on SEDAR at www.sedar.com and at the Company`s website at gsilver.com.

Technical Information

Hernan Dorado Smith, a director and officer of GSilver and a “qualified person” as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects, has approved the scientific and technical information contained in this news release.

About Guanajuato Silver

GSilver is a precious metals producer engaged in reactivating past producing silver and gold mines near the city of Guanajuato, Mexico, which has an established 480-year mining history. With five mines and three processing facilities, the Company is one of the fastest growing silver producers in Mexico.