GSilver Reports Year End 2022 Financial Results; Provides 2023 Production Guidance

Guanajuato Silver Company Ltd. (TSX-V:GSVR) (AQUIS:GSVR) (OTCQX:GSVRF) is pleased to announce selected financial information and consolidated production results for the year ended December 31, 2022. The Company’s consolidated financial statements for the year ended December 31, 2022 and Management’s Discussion and Analysis thereon can be viewed under the Company’s profile at www.sedar.com. Production results are from the Company’s wholly owned El Cubo Mines Complex, Valenciana Mines Complex, and San Ignacio Mine located in Guanajuato, Mexico, and the Topia Mine located in Durango, Mexico.

Selected 2022 Highlights:
(All figures in US Dollars)

• Record production for 2022 of 2.15 million silver-equivalent ounces; this included record production for the fourth quarter of 836,375 AgEq ounces derived from 401,244 ounces of silver, 3,907 ounces of gold, 811,492 pounds of lead and 1,261,554 pounds of zinc.⁽¹⁾ GSilver has delivered continuous quarter-over-quarter increases in AgEq production since the inception of precious metals processing in 2021.
• Record silver production of over one-million ounces; GSilver is a primary silver producer.
• Successful ramp-up across all four producing silver mines remains in-line with modeled expectations.
• Record revenue for 2022 of $36.8M generated by a realized average price of $21.23 per silver ounce, $1,783 per gold ounce, $0.92 per pound of lead, and $1.42 per pound of Zinc.
• Silver recoveries continue to exceed historical rates; the average silver recovery for 2022 was 86%; the average gold recovery over the same period was 84.5%.
• Cash costs of $15.84 per AgEq ounce, and AISC of $21.55 per AgEq ounce remain in-line with the Company’s projections; AISC was influenced in 2022 by significant capital expenditures during ramp-up across all four producing assets.
• Positive mine operating cash flow⁽⁷⁾ of over $2M.
• Over 60% of the net loss for 2022 comprises either non-cash or one-time items⁽⁹⁾; net loss for the year totaled $26.7M.
• As of December 31, 2022, the Company had cash and cash equivalents of $8,832,936 and negative working capital of $5,972,704 compared with cash of $8,234,043 and positive working capital of $1,670,108 as of December 31, 2021.

“Having achieved producer status in late 2021, we have now successfully completed our first full year of precious metals production from our expanding portfolio of silver mines in central Mexico,” said James Anderson, Chairman and CEO. “Throughout 2022 we have exceeded many of our ramp-up targets, such as very strong process plant recoveries, and consistently larger throughput volumes of mineralized material. Our Company’s rapid growth is demonstrated by our strong quarter over quarter silver and gold production increases, which we plan to accelerate throughout 2023. Our operations team remains focused on delivering even greater success for 2023 as we aim to further enhance Guanajuato Silver’s status as one of the fastest growing silver producers in Mexico.”

2023 Production and Cost Guidance

In 2023, silver equivalent production is expected to range from 4.6 to 4.8 million ounces. Consolidated cash costs per ounce are expected to be slightly lower compared to 2022; whereas AISC is expected to be similar to 2022 as the Company completes several strategic capex initiatives in 2023; most notably the Topia mill expansion and modernization, the reintegration of the central Cata production shaft at Valenciana, and the installation of a dry stack tailings facility at El Cubo.

View Operating and Financial Results Here

1. Silver equivalents are calculated using an 83.22:1 (Ag/Au), 0.05:1 (Ag/Pb) and 0.07:1 (Ag/Zn) ratio for 2022; and 80:1 (Ag/Au) ratio for 2021, respectively.
2. Cash cost per silver equivalent ounce include mining, processing, and direct overhead. See Reconciliation to IFRS in the Company’s Management Discussion and Analysis.
3. AlSC per oz include mining, processing, direct overhead, corporate general and administration expenses, on-site exploration, reclamation and sustaining capital. The production costs for the year ended December 31, 2021, include mining cost from July to September 2021, prior to the commencement of milling and concentrate production, and therefore differ from the production costs for the three months ended December 31, 2021. See Reconciliation to IFRS in the Company’s Management Discussion and Analysis.
4. See Reconciliation of earnings before interest, taxes, depreciation, and amortization in the Company’s Management Discussion and Analysis
5. See “Non-IFRS Financial Measures in the Company’s Management Discussion and Analysis.
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 in the Company’s Management Discussion and Analysis.
8. These are non-IFRS financial measures and ratios. Further details on these non-IFRS financial measures and ratios are provided at the end of this press release and in the MD&A accompanying the Company’s financial statements on SEDAR at www.sedar.com.
9. Non-cash items include depreciation, stock-based compensation, loss or gain on derivatives, change of fair value on contingent payments and unrealized FX; one-time items include transaction costs associated with the acquisition of MMR, and a one-time charge for care & maintenance of the Valenciana Mines Complex prior to production restart.

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.

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.