Silvercorp Metals Inc. (TSX: SVM) (NYSE American: SVM) reported its financial and operating results for the three months ended September 30, 2024. All amounts are expressed in US dollars, and figures may not add due to rounding.

HIGHLIGHTS FOR Q2 FISCAL 2025  

• Mined 361,440 tonnes of ore, milled 297,205 tonnes of ore, and produced approximately 1,183 ounces of gold, 1.7 million ounces of silver, or approximately 1.8 million ounces of silver equivalent¹, plus 13.2 million pounds of lead and 5.8 million pounds of zinc;
• Sold approximately 1,239 ounces of gold, 1.6 million ounces of silver, 13.3 million pounds of lead, and 5.9 million pounds of zinc, for revenue of $68.0 million;
• Net income attributable to equity shareholders of $17.7 million, or $0.09 per share;
• Adjusted net income attributable to equity shareholders¹ of $17.8 million, or $0.09 per share;
• Generated cash flow from operating activities of $23.1 million;
• Cash cost per ounce of silver, net of by-product credits¹, of negative $0.73;
• All-in sustaining cost per ounce of silver, net of by-product credits¹, of $11.66;
• Spent and capitalized $0.5 million on exploration drilling, $14.6 million on underground exploration and development, and $9.6 million on equipment and facilities, including the No. 3 tailings storage facility at the Ying Mining District;
• Spent and capitalized $181.3 million on the acquisition of Adventus Mining Corporation, by issuing $150.5 million in shares, making $27.0 million cash investments and advances, and incurring $3.8 million in cash transaction costs;
• The Company has $209.5 million in cash and cash equivalents and short-term investments, and holds a portfolio of equity investment in associates and other companies with a total market value of $84.4 million as at September 30, 2024; and
• Commissioning trial runs of the new 1,500 tonne per day mill commenced on November 1, 2024. The inventory stockpile of approximately 129,000 tonnes of ore at the Ying Mining District is expected to be processed over 2-3 months, which will enhance metal production to align with the Company’s Fiscal 2025 annual guidance.

CONSOLIDATED FINANCIAL RESULTS 

Net income attributable to equity shareholders of the Company in Q2 Fiscal 2025 was $17.7 million or $0.09 per share, compared to net income of $11.1 million or $0.06 per share in the three months ended September 30, 2023.

Compared to Q2 Fiscal 2024, the Company’s consolidated financial results were mainly impacted by i) increases of 20%, 34%, 15% and 43%, respectively, in the realized selling prices for gold, silver, lead and zinc; ii) increases of 4% and 29%, respectively, in silver and zinc sold; and iii) a $3.8 million in gain on investments, offset by iv) decreases of 51% and 13%, respectively, in gold and lead sold; v) an increase of $2.1 million in mine and corporate administrative expenses; vi) an increase of $1.1 million in business development expenditures; and vii) a negative impact of $2.4 million in foreign exchange.

Excluding certain non-cash, non-recurring, and non-routine items, the adjusted basic earnings to equity shareholders were $17.8 millionor $0.09 per share compared to $11.7 million or $0.07 per share in Q2 Fiscal 2024.

Revenue in Q2 Fiscal 2025 was $68.0 million, up 26% compared to $54.0 million in Q2 Fiscal 2024. The increase is mainly due to an increase of $15.2 million arising from the increase in the realized selling prices and an increase of $3.2 million arising from the increase of silver and zinc sold, offset by a decrease of $4.7 million as a result of less gold and lead sold.

Income from mine operations in Q2 Fiscal 2025 was $31.7 million, up 51% compared to $20.9 million in Q2 Fiscal 2024. The increase was mainly due to the increase in revenue arising from the increases in the net realized metal selling prices. Income from mine operations at the Ying Mining District was $29.1 million, compared to $21.8 million in Q2 Fiscal 2024. Income from mine operations at the GC Mine was $3.0 million, compared to a loss of $0.7 million in Q2 Fiscal 2024.

Cash flow provided by operating activities in Q2 Fiscal 2025 was $23.1 million, down $5.7 million, compared to $28.8 million in Q2 Fiscal 2024. The decrease was due to:

• $27.6 million cash flow from operations before changes in non-cash operating working capital, up $2.0 million compared to $25.6 million in Q2 Fiscal 2024; offset by
• $4.5 million cash used by changes in non-cash working capital, compared to $3.2 million provided in Q2 Fiscal 2024.

The Company ended the quarter with $209.5 million, up 13% or $24.6 million compared to $184.9 million as at March 31, 2024, but down 3% or $6.2 million compared to $215.7 million as at June 30, 2024. The Company holds a further equity investment portfolio in associates and other companies with a total market value of $84.4 million as at September 30, 2024.

CONSOLIDATED OPERATIONAL RESULTS

In Q2 Fiscal 2025, on a consolidated basis, the Company mined 361,440 tonnes of ore, up 32% compared to 273,465 tonnes in Q2 Fiscal 2024. Ore milled was 297,205 tonnes, up 14% compared to 261,107 tonnes in Q2 Fiscal 2024.

In Q2 Fiscal 2025, the Company produced approximately 1,183 ounces of gold, 1.7 million ounces of silver, or approximately 1.8 million ounces of silver equivalent, plus 13.2 million pounds of lead and 5.8 million pounds of zinc, representing increases of 4% and 26% in silver and zinc and decreases of 52%, 4%, and 18% in gold, silver equivalent, and lead production over Q2 Fiscal 2024. The decrease in gold and lead production is mainly due to i) approximately 129,000 tonnes of unprocessed ore stockpiled due to mill capacity constraints and ii) a lower lead head grade.

In Q2 Fiscal 2025, the consolidated mining cost was $67.17 per tonne, up 4% compared to $64.77 per tonne in Q2 Fiscal 2024. The increase was mainly due to more mining preparation tunnels and grade control drilling completed and expensed as part of the mining cost in the current quarter. The consolidated milling cost was $12.73 per tonne, down 3% compared to $13.10 per tonne in Q2 Fiscal 2024. Correspondingly, the consolidated production cost per tonne of ore processed was $82.33 per tonne, up 2% compared to $80.53 per tonne in Q2 Fiscal 2024, while the all-in sustaining production cost per tonne of ore processed was $145.53 per tonne, down 3% compared to $149.94 per tonne in Q2 Fiscal 2024. The decrease was mainly due to a decrease of 4% in per tonne sustaining capital expenditures, offset by an increase of 2% in the per tonne production cost.

In Q2 Fiscal 2025, the consolidated cash cost per ounce of silver, net of by-product credits, was negative $0.73, compared to negative $1.00 in Q2 Fiscal 2024. The increase was mainly due to the 2% increase in per tonne production costs, partially offset by an increase of $1.7 million in by-product credits. The consolidated all-in sustaining cost per ounce of silver, net of by-product credits, was $11.66, up 1% compared to $11.50 in Q2 Fiscal 2024. The increase was mainly due to the increase in cash cost per ounce of silver.

EXPLORATION AND DEVELOPMENT

Total capital expenditures in Q2 Fiscal 2025 were $28.1 million, up 86% compared to $15.1 million in Q2 Fiscal 2024. The increase was mainly due to more tunneling completed and the construction of the No.3 tailings storage facility and mill expansion at the Ying Mining District as well as additional expenditures incurred at the newly acquired El Domo Project and Condor Project. Total capital expenditures incurred to construct the TSF were approximately $4.0 million in Q2 Fiscal 2025 and $16.0 million since the inception of construction. The capital expenditures incurred for the 1,500 tonne per day mill expansion were approximately $2.8 million in Q2 Fiscal 2025 and $3.2 million since the inception of construction.

In Q2 Fiscal 2025, on a consolidated basis, a total of 75,287 metres or $2.0 million worth of diamond drilling were completed (Q2 Fiscal 2024 – 76,184 metres or $2.6 million), of which approximately 56,795 metres or $1.5 million worth of diamond drilling were expensed as part of mining costs (Q2 Fiscal 2024 – 29,548 metres or $0.6 million) and approximately 18,492 metres or $0.5 millionworth of diamond drilling were capitalized (Q2 Fiscal 2024 – 40,636 metres or $2.0 million). In addition, approximately 25,650 metres or $9.2 million worth of preparation tunneling were completed and expensed as part of mining costs (Q2 Fiscal 2024 – 10,868 metres or $4.1 million), and approximately 24,926 metres or $14.6 million worth of tunnels, raises, ramps and declines were completed and capitalized (Q2 Fiscal 2024 – 24,727 metres or $10.6 million).

INDIVIDUAL MINE OPERATING PERFORMANCE  

In Q2 Fiscal 2025, a total of 272,046 tonnes of ore were mined at the Ying Mining District, up 23% compared to 220,636 tonnes in Q2 Fiscal 2024, and 210,498 tonnes of ore were milled, down 1% compared to 212,868 tonnes in Q2 Fiscal 2024.

Average head grades of ore processed were 240 g/t for silver, 2.8% for lead, and 0.6% for zinc compared to 235 g/t for silver, 3.5% for lead, and 0.7% for zinc in Q2 Fiscal 2024. The silver head grade achieved is higher than the Company’s Fiscal 2025 annual guidance of 235 g/t.

Metals produced at the Ying Mining District were approximately 1,183 ounces of gold, 1.5 million ounces of silver, or approximately 1.6 million ounces of silver equivalent, plus 12.0 million pounds of lead, and 1.8 million pounds of zinc, representing a production increase of 1% in silver and decreases of 52%, 7%, 20%, and 18%, respectively, compared to 2,458 ounces of gold, 1.5 million ounces of silver, or approximately 1.7 million silver equivalent, plus 15.0 million pounds of lead, and 2.2 million pounds of zinc in Q2 Fiscal 2024. The decrease in gold, lead and zinc production is mainly due to i) milled ore is 1% lower with approximately 129,000 tonnes of unprocessed ore stockpiled and ii) lower lead and zinc head grades. The Company expects the stockpiled ore will be processed in the third and fourth quarters after the 1,500 tonne per day mill expansion at the Ying Mining District is achieved in the third quarter of Fiscal 2025.

In Q2 Fiscal 2025, a total of 89,394 tonnes of ore were mined at the GC Mine, up 69% compared to 52,829 tonnes in Q2 Fiscal 2024, while 86,707 tonnes were milled, up 80% compared to 48,239 tonnes in Q2 Fiscal 2024.

In Q2 Fiscal 2025, approximately 12,700 tonnes of waste was removed through the XRT Ore Sorting System.

Average head grades of ore milled were 61 g/t for silver, 0.8% for lead, and 2.4% for zinc compared to 66 g/t for silver, 1.1% for lead, and 2.5% for zinc in Q2 Fiscal 2024.

Metals produced at the GC Mine were approximately 137 thousand ounces of silver, 1.2 million pounds of lead, and 4.0 million pounds of zinc, representing increases of 63%, 18%, and 67%, respectively, in silver, lead and zinc production, compared to 84 thousand ounces of silver, 1.0 million pounds of lead, and 2.4 million pounds of zinc in Q2 Fiscal 2024.

CONFERENCE CALL DETAILS 

A conference call to discuss these results will be held tomorrow, Friday, November 8, at 9:00 am PDT (12:00 pm EDT). To participate in the conference call, please dial the numbers below.

Canada/USA TF: 888-510-2154

International/Local Toll: 437-900-0527

Conference ID: 69957

Participants should dial-in 10 – 15 minutes prior to the start time.  A replay of the conference call and transcript will be available on the Company’s website at www.silvercorpmetals.com.

Mr. Guoliang Ma, P.Geo., Manager of Exploration and Resources of the Company, is the Qualified Person as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and has reviewed and given consent to the technical information contained in this news release.

About Silvercorp 

Silvercorp is a Canadian mining company producing silver, gold, lead, and zinc with a long history of profitability and growth potential. The Company’s strategy is to create shareholder value by 1) focusing on generating free cashflow from long life mines; 2) organic growth through extensive drilling for discovery; 3) ongoing merger and acquisition efforts to unlock value; and 4) long term commitment to responsible mining and ESG. For more information, please visit our website at www.silvercorpmetals.com.