Aya Gold & Silver Reports Strong Cash Flow and Silver Production of 526,703 Ounces in Q2-2023
(1) The Corporation reports non-GAAP measures, which include cash costs per silver ounce and free cash flow , which are widely
used in the mining industry as a benchmark for performance, but do not have a standardized meaning and the methods used by
the Corporation to calculate such measures may differ from methods used by other companies with similar descriptions. See
“Non-GAAP Measures” on page 15 of the Corporation’s Q2-2023 MD&A for a reconciliation of non-GAAP to GAAP measures.
(2) Non-GAAP Measures, consisting of cash and cash equivalents of $49,568,497 and restricted cash of $2,540,987.
PRESS RELEASE
Aya Gold & Silver Reports Strong Cash Flow and Silver Production of 526,703
Ounces in Q2-2023
Montreal, Quebec, August 11, 2023 - Aya Gold & Silver Inc. (TSX: AYA, OTCQX: AYASF) (“Aya” or the
“Corporation”) is pleased to announce interim financial and operational results for the second quarter
ended June 30, 2023. All amounts are in thousands of US dollars unless otherwise stated.
Q2-2023 Highlights
Operational and Financial
• Strong operational performance:
o Silver production of 526,703 ounces (“oz”) in Q2-2023, a 15% increase from Q2-2022
o Recoveries averaged 87.3% in Q2-2023, compared to 87.9% in Q2-2022
o Ore processed increased to 72,190 tonnes (“t”) in Q2-2023 compared to 59,995t in Q2-
2022
• Revenue of $9.6 million in Q2-2023, a 12% increase from Q2-2022
• Cash cost of $10.98 per oz in Q2-2023 compared to $10.95 per oz in Q2-2022 (¹)
• Operating cash flow of $3.7 million in Q2-2023, a 234% increase compared to Q2-2022
• Robust financial position with $ 52 million of cash, cash equivalents and restricted cash (²)
compared to $42 million at December 31, 2022
• Settled dispute with previous CEO and related Net-Profit Interest (“NPI”) agreement, resulting
in the dissolution of the NPI
Exploration and Development:
• Completed 12,424 meters (“m”) of drilling at Zgounder in Q2-2023
• Conducted 4,634m of diamond drill hole (“DDH”) drilling on Zgounder Regional properties in
Q2-2023:
o Preliminary results returned anomalous zinc (“Zn”) and copper (“Cu”) values including
silver (“Ag”) intercepts
• Completed 18.7 kilometers (“km”) of the 36km DDH program at Boumadine in Q2-2023:
o Extended the strike 400m to 3.8km, which remains open in all directions
o Mapping identified a new at-surface northwest zone that extends over 1.5km
• Acquired Tirzzit historical copper mine property, which is 67.7km², and rights for $4.7 million
Zgounder Expansion:
• Advanced Zgounder Mine expansion in Q2-2023:
o Overall project 45% complete and tracking on budget
o Underground development on track, with 65% of lateral and 42% of vertical
development completed
o Completed detailed engineering, ball mill and crushing equipment on schedule
o Mobilised open-pit contractor, commenced in-pit stripping and produced first ore
o Continued construction of the new tailings and water storage facilities on schedule
Long-term Sustainability of Zgounder Operations:
• Continued construction of the 90km power line to connect Zgounder to renewable grid power
• Provided over 3,040 hours of health & safety training
• Completed emergency response station and took delivery of mine rescue vehicle a nd
equipment
“Continuing our strong start to the year, Zgounder delivered another exceptional quarter with strong
financials and solid execution. We benefited from above -capacity milling rates and higher silver
prices, which drove strong cash flow and silver production of 526,703 ounces as well as lower cash
costs,” said Benoit La Salle, President and CEO. “We continue to execute on our Zgounder expansion,
which is 45% complete and on budget, and are well-positioned to achieve our full-year production and
cost guidance.
In July, we published our 2022 Sustainability Report highlighting how we have accelerated integration
of ESG and climate change across Aya. We have aligned our operations with the recommendations
of the TCFD and tied executive compensation with strategic objectives linked to key ESG performance
indicators.
Our exploration success and resource growth continued in the quarter with the strike extension to the
south and the discovery of a northwest zone at Boumadine. We also acquired the historical Tirzzit
copper mine, which adds seven prospective copper -silver permits near Zgounder. In the near -term,
we are adding drill rigs at Zgounder and Boumadine and mobilizing at Tirzzit and expect to further
extend the Boumadine Main Trend, which will translate into additional resources in Q1-2024.”
Q2-2023 Operational and Financial Highlights
Key Performance Metrics* Q2-2023 Q2-2022 Variation
Operational
Ore Mined (t) 103,231 62,221 66%
Ore Processed (t) 72,190 59,995 20%
Average Grade (g/t Ag) 265 273 (3%)
Mill Recovery (%) 87.3% 87.9% (<1%)
Silver Ingots Produced (oz) 202,559 219,762 (8%)
Silver in Concentrate Produced (oz) 324,144 239,299 35%
Total Silver Produced (oz) 526,703 459,061 15%
Silver Ingots Sold (oz) 164,707 196,556 (16%)
Silver in Concentrate Sold (oz) 287,816 242,524 19%
Total Silver Sales (oz) 452,523 439,080 3%
Avg. Net Realized Silver ($/oz) 21.26 19.53 9%
Cash Costs per Silver Ounce Sold (¹) 10.98 10.95 <1%
Financial
Revenue 9,621 8,574 12%
Cost of sales 6,876 5,811 18%
Gross Margin 2,745 2,763 (1%)
Operating (loss) (36) 506 (107%)
Net Earnings (loss) (525) 725 (172%)
Operating Cash Flow 3,674 1,100 234%
Cash and Restricted Cash (2) 52,109 67,945 (23%)
Shareholders
Earnings (Loss) per Share – basic (0.00) 0.01 NM
Earnings (Loss) per Share – diluted (0.00) 0.01 NM
(1,2) See footnotes (1, 2) on first page.
Second Quarter 2023 Financial & Operational Highlights
• Quarterly silver production of 526,703 oz, comprising 3 24,144 oz in silver concentrate and
202,559 oz in silver bars.
• Mill average feed grade of 265 grams per tonne (“g/t”) Ag was reported in Q2-2023 compared
to 273 g/t Ag in Q2-2022, a decrease of 3%.
• Milling operations reached 793 tonnes per day (“tpd”), surpassing design capacity of 700 tpd.
• Average combined mill recovery of to 87.3% in Q2-2023 compared to 8 7.9% in Q 2-2022, a
decrease of 0.6%.
• Plant availabilities reached 9 3.4% and 9 6.6% for the flotation and cyanidation plants,
respectively.
• Cash flow generated by operating activities of $ 3,674 in Q2-2023 compared to cash flow of
$1,100 in operating cash flow in Q2-2022.
• Revenue from silver sales totaled $9,621 (Q2-2022 – $8,574) in Q2-2023, an increase of 12%
representing an average realized price of $21.26/oz. (Q2-2022 - $19.53/oz).
• Operations generated a gross margin of $2, 745 in Q2-2023, a 1% decrease compared to Q2-
2022.
• Net loss for the quarter was $ (525) (diluted EPS of $ (0.00)) in Q2 -2023, compared to net
earnings of $725 (diluted EPS of $0.01) in Q2-2022.
Q2-2023 Operations Review
In Q2-2023, Zgounder Mine operations focused on the ramp-up of the underground mine, completing
mobilization of the open pit contractor and finalizing the open -pit definition drilling program. The
1,950m underground level is now fully operational, and access to the 1,925m level is in construction.
Open-pit stripping commenced in June, and ore production occurred in July. A total of 103,231t of ore
was mined and 72,190t was processed in Q2, adding over 30kt of ore in inventory, in line with the 2024
commissioning plan.
The quarter saw completion of the new emergency response and mine rescue station as well as on-
site delivery of mine rescue equipment and an emergency vehicle. Consequently, training for the mine
rescue and emergency response teams has been scheduled in the second half of the year. Over 4,075
hours of training have been dispensed year to date, a 150% increase compared to H1-2022 which
reflects the Corporation’s commitment to enhancing the health and safety culture at Zgounder.
Zgounder Development
Construction of the plant and surface infrastructure continue d to track on budget. At the end of Q 2-
2023, the mine expansion project was 45% complete, compared to 32% at end of Q1-2023.
Construction of the processing plant was 40% complete, with engineeri ng near -complete and
procurement well advanced. Earthworks were completed in the quarter, and most concrete
foundations were poured. Delivery of several long-lead equipment items are expected on site in Q3-
2023, including the ball mill.
Underground development continued to advance strongly in the quarter. Over 6,500m of lateral and
ramp accesses have now been completed, representing 65% of the total lateral infrastructure. Most
levels between 1,925m and 2,100m are now connected to the underground ramp. The main
ventilation shaft has been completed, and installation of primary fans is planned for Q3 -2023. To
date, 253m of vertical raises have been completed, 42% of the total development. In June, the open
pit contractor was mobilized, and open pit operations commenced. Overall, open pit and
underground mine development are 47% advanced.
At quarter -end, construction of the tailing storage facility was progres sing well and was 55%
complete. The two water storage basins were 74% complete with only the lining installation
remaining, in time before the rainy season. Other infrastructure, such as the camp, roads, workshops,
and warehouses, were 55% completed. Finally, the power line and electrical substations progressed
to 27% completion.
At the end of Q2-2023, $132 million had been committed across all capital cost categories, and $54
million had been incurred. The Aya project team remains confident of completing the project within
the original budget of $159 million including contingency.
The table below presents construction progress by main project area:
Area Progress
Process Plant 40%
Underground and Open-Pit Mines 47%
Tailings 55%
Water Management 74%
Electrical Infrastructure 27%
On-site Infrastructure 55%
Figure 1 – Ongoing civil and concrete work at the new Zgounder processing plant
Q2-2023 Exploration
Zgounder
In Q2-2023, drilling at Zgounder focused on delineating near-mine targets both laterally and at depth.
A total of 12,424m of DDH and reverse circulation (“RC”) drilling was conducted on Zgounder in Q2-
2023 (exploration and definition drilling) including T28 and YAK underground drilling. At quarter-end,
two underground rigs were active on the property and the 2 6,000m underground DDH program was
17% complete. Given that the development of the 1 ,950m level is complete and the 1,925m level is
near-complete, the exploration program is expected to be expanded in H2-2023.
Notably, surface RC drill hole ZG -RC-23-2260-70 intersected 1,611 g/t Ag over 27m including 4,771
g/t Ag over 5.0m, confirming ongoing high -grade mineralization in the open -pit area. Furthermore,
hole ZG-23-02 returned 1,753 g/t Ag over 6.5m, defining high-grade mineralization from surface in the
east outside of the resource envelope.
Zgounder Regional
At the end of June 2023, a total of 8,582m had been drilled on the Zgounder Far West, Tala and Izza
areas of the Zgounder Regional permits. Preliminary results released at the end of May returned
anomalous Zn, Cu and Ag values that will be drill tested in parallel to new zones. Hole ZGW -22-06 in
the Zgounder Far West intercepted 1.22% Zn over 8 5.5m including 1.91% Zn over 5.0m. In the Tala
area, hole AM-22-001 intercepted 0.93% Cu over 6.0m including 1.27% Cu over 3.0m.
Boumadine
Five drill rigs were active on the Boumadine property throughout the second quarter with a total of
31,395m drilled in H1-2023. The 2023 drill program, which was 85% complete at quarter -end, was
completed in July. The aim of the infill and exploration drilling was to explore and extend the strike
along the main trend in the Central and South Zones. In early July, results from Q2-2023 drilling were
released, confirming the extension of the main trend mineralization by 400m to 3.8km in strike to the
south with BOU-DD23-125, BOU-DD23-136 and BOU-DD23-142 intersecting high-grade mineralization
in the form of massive sulphide veins.
In parallel, results from surface detailed mapping were received in Q2-2023 which identified a new at-
surface northwest zone at Boumadine. The surface samples returned values up to 460 g/t AgEq along
a 1.5km structure of N030 orientation, demons trating the potential outside of the Boumadine Main
Trend (see Figure 7). The mapping revealed two major sets of faulting events: a N030 faulting event
that cross-cut Boumadine Main Trend (N340) and may be responsible for the Au -Zn enrichment of
the minera lization; and a N070 fault event cutting both N340 and N070 structures which seem
responsible for the Ag-Pb enrichment. A total of 127 surface grab samples were also taken, with 36
still pending results.
The quarter saw a first site visit by RSC Consulti ng Limited, which has been mandated to conduct a
NI 43 -101-compliant mineral resource estimate of Boumadine. Furthermore, an on -site sample
preparation laboratory was commissioned on the project site, which will greatly improve sample
turnaround times.
The technical information relating to Zgounder , Zgounder Regional and Boumadine properties was
reviewed and approved by David Lalonde, B. Sc, Head of Exploration, designated as a Qualified Person
under National Instrument 43-101.
Acquisition of Tirzzit
On June 28, 2023, the Corporation acquired Tirzzit, a collection of seven permits located 25 km from
the Zgounder Silver Mine in the Kingdom of Morocco.
The Corporation issued 622,728 of its shares at C$8.36 (having a value of $3.9M) and paid $800,000
in cash for a total consideration of $4.7 million. The assets acquired include the following:
• Seven permits, comprising five exploration permits and two mining licenses, one of which
hosts a high-grade historical copper mine.
• A property totaling 67.7 square km.
The transaction remains subject to administrative procedures in the Kingdom of Morocco.
Q2-2023 Conference Call
The Corporation will hold a conference call today at 10 am EDT to discuss its Q2-2023 financial and
operational results. The webcast can be accessed as follows:
• Via webcast: https://app.webinar.net/PblE8kG8eLX
• Via URL entry: https://emportal.ink/3NONQbo
To join the call without operator assistance, register and enter your phone number to receive
an instant automated call back.
• Via telephone: Local and international: (+1) 416-764-8650
N. American Toll Free: 888-664-6383
You can also dial direct to be entered to the call by an operator. To ensure your participation,
please call approximately five minutes prior to the scheduled start of the call.
The conference call and webcast will be available for replay by dialing (+1) 416-764-8677 or toll-free
on 1-888-390-0541, entry code 370442 #. The conference call replay will expire on August 18, 2023.
The presentation slides will also be posted on Aya’s website.
About Aya Gold & Silver Inc.
Aya Gold & Silver Inc. is a rapidly growing, Canada -based silver producer with operations in the
Kingdom of Morocco.
The only TSX-listed pure silver mining company, Aya operates the high -grade Zgounder Silver Mine
and is exploring its properties along the prospective South-Atlas Fault, several of which have hosted
past-producing mines and historical resources. Aya’s Moroccan mining assets are complemented by
its Tijirit Gold Project in Mauritania, which is being advanced to feasibility.
Aya’s management team is focused on maximising shareholder value by anchoring sustainability at
the heart of its operations, governance, and financial growth plans.
For additional information, please visit Aya’s website at www.ayagoldsilver.com.
Or contact:
Benoit La Salle, FCPA MBA
President & CEO
Alex Ball
VP, Corporate Development & IR
Forward-Looking Statements
This press release contains certain statements that constitute forward-looking information within the
meaning of applicable securities laws (“forward-looking statements”), which reflects management's
expectations regarding Aya’s future growth and business prospects (including the timing and
development of new deposits and the success of exploration activities) and other opportunities.
Wherever possible, words such as “will”, “expect”, “maintain”, “achieve”, “expand”, “ramp -up”, “plan”,
“as-planned”, “tracki ng”, “guidance”, “potential”, “deliver”, “committed”, “continue”, “growth”,
“advance”, “expected”, “increase”, and similar expressions or statements that certain actions, events
or results “may”, “could”, “would”, “might”, “will”, or are “likely” to be taken, occur or be achieved, have
been used to identify such forward -looking information. Specific forward-looking statements in this
press release include, but are not limited to, statements and information with respect to the
exploration and development potential of Zgounder and the conversion of Inferred Mineral Resources
into Measured and Indicated Mineral Resources, future opportunities for enhancing development at
Zgounder, executing on the planned expansion at the Zgounder mine, and timing for the relea se of
the Company's disclosure in connection with the foregoing. Although the forward-looking information
contained in this press release reflect management's current beliefs based upon information currently
available to management and based upon what management believes to be reasonable assumptions,
Aya cannot be certain that actual results will be consistent with such forward -looking information.
Such forward -looking statements are based upon assumptions, opinions and analysis made by
management in light of its experience, current conditions, and its expectations of future
developments that management believe to be reasonable and relevant but that may prove to be
incorrect. These assumptions include, among other things, the closing and timing of financing, the
ability to obtain any requisite governmental approvals, the accuracy of Mineral Reserve and Mineral
Resource Estimates (including, but not limited to, ore tonnage and ore grade estimates), silver price,
exchange rates, fuel and energy costs, future ec onomic conditions, anticipated future estimates of
free cash flow, and courses of action. Aya cautions you not to place undue reliance upon any such
forward-looking statements. The risks and uncertainties that may affect forward-looking statements
include, among others: the inherent risks involved in exploration and development of mineral
properties, including government approvals and permitting, changes in economic conditions, changes
in the worldwide price of silver and other key inputs, changes in mine plans (including, but not limited
to, throughput and recoveries being affected by metallurgical characteristics) and other factors, such
as project execution delays, many of which are beyond the control of Aya, as well as other risks and
uncertainties which are more fully described in Aya's 2022 Annual Information Form dated March 31,
2023, and in other filings of Aya with securities and regulatory authorities which are available on
SEDAR at www.sedar.com. Aya does not undertake any obligation to update forward -looking
statements should assumptions related to these plans, estimates, projections, beliefs and opinions
change. Nothing in this document should be construed as either an offer to sell or a solici tation to
buy or sell Aya securities. All references to Aya include its subsidiaries unless the context requires
otherwise.