Guanajuato Silver Successfully Completes First Full Year of Precious Metals Production ~ GSilver Reports Year End 2022 Financial Results; Provides 2023 Production Guidance ~
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Guanajuato Silver Successfully Completes First Full Year of Precious Metals Production
~ GSilver Reports Year End 2022 Financial Results; Provides 2023 Production Guidance ~
April 10, 2023 – Vancouver, British Columbia – Guanajuato Silver Company Ltd. (the “Company” or “GSilver”)
(TSXV: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 (“MD&A”) 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 (“El Cubo”), Valenciana Mines Complex ( VMC), and San Ignacio Mine (“San
Ignacio”) located in Guanajuato, Mexico, and the Topia Mine (“Topia”) located in Durango, Mexico.
Selected 2022 Highlights:
(All figures in US Dollars)
• Record production for 2022 of 2.15 million silver-equivalent ounces (“AgEq”); 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 c osts 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.”
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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.
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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.
Consolidated Operating and Financial Overview (All figures in US Dollars)
Year Ended Change
Consolidated Dec 31, 2022 Dec 31, 2021 2022 vs 2021
Operating
Tonnes mined 410,305 89,082 361%
Tonnes milled 418,849 77,524 440%
Silver ounces produced 1,011,877 124,750 711%
Gold ounces produced 11,174 1,440 676%
Lead produced (lbs) 1,349,100 - -
Zinc produced (lbs) 1,938,681 - -
Silver equivalent (“AgEq”) oz produced(1) 2,150,222 235,609 813%
Silver recovery (%) 86.0 82.90 4%
Gold recovery (%) 84.5 78.80 7%
Lead Recovery (%) 88.7 - -
Zinc recovery (%) 84.5 - -
Silver ounces sold 1,011,259 105,203 861%
Gold ounces sold 11,064 1,179 838%
Lead sold (lbs) 1,350,688 - -
Zinc sold (lbs) 1,874,138 - -
AgEq ounces sold(1) 2,132,404 199,526 969%
Cost per tonne ($)(5) 80.86 79.10 2%
Cash cost per AgEq ounce ($) (1)(2)(5) 15.84 25.45 (38%)
AISC per AgEq ounce ($) (1)(3)(5) 21.55 73.70 (71%)
Financial $ $
Revenue 36,880,204 4,116,811 796%
Cost of Sales 43,763,192 6,350,863 589%
Mine operating cashflow before taxes(7) 2,037,915 (965,211) (311%)
Mine operating loss (6,882,990) (2,234,052) 208%
Net loss (26,771,585) (11,849,800) 126%
EBITDA(4)(5) (13,825,789) (9,312,481) 48%
Adjusted EBITDA(4)(5) (9,192,344) (7,050,839) 30%
Realized silver price per ounce(6) 21.23 23.35 (9%)
Realized gold price per ounce(6) 1,783.36 1,784.02 (0%)
Realized lead price per pound(6) 0.92 - -
Realized zinc price per pound(6) 1.42 - -
Working capital(5) (5,972,704) 1,670,108 (458%)
Shareholders
Loss per share – basic and diluted (0.10) (0.06) 74%
Weighted Average Shares Outstanding 256,318,795 183,697,735 40%
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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 histo ry. 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.
ON BEHALF OF THE BOARD OF DIRECTORS
“James Anderson”
Chairman and CEO
For further information regarding Guanajuato Silver Company Ltd., please contact:
JJ Jennex, Gerente de Comunicaciones, T: 604 723 1433
Gsilver.com
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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Non-IFRS and Other Financial Measures and ratios
Certain non-IFRS and other non-financial measures and ratios are included in this news release including cost per tonne,
cash cost per AgEq ounce, all-in sustaining cost (“AISC”) per AgEq ounce, earnings before interest, taxes, depreciation and
amortization (“EBITDA”), adjusted EBITDA and working capital. See the December 31, 2022 MD&A for explanations and
discussion of these non-IFRS and other non-financial measures and ratios. The Company believes these measures and
ratios, in addition to financial measures and ratios prepared in accordance with International Financial Reporting
Standards (“IFRS”), provide management and investors with additional information with which to evaluate the Company’s
performance. However, these measures do not have a standardized meaning under IFRS and may not be comparable to
similar financial measures disclosed by other companies. Accordingly, non-IFRS financial measures and non-IFRS ratios
should not be considered in isolation or as a substitute for measures and ratios of the Company’s performance prepared
in accordance with IFRS. Certain additional disclosures for these non-IFRS measures including, where applicable, a
reconciliation thereof to IFRS, and can be found in the section “Non-IFRS Financial Measures” in the December 31, 2022
MD&A available on SEDAR at www.sedar.com.
Forward-Looking Statements
This news release contains certain forward-looking statements and information, which relate to future events or future
performance including, but not limited to, the Company’s 2023 production and cost guidance, the continuing trend of
quarterly increases in production and silver equivalent ounce recoveries in 2023; the Company’s strategic capex initiatives
for 2023 including the Topia mill expansion and modernization, the reintegration of the central Cata production shaft at
VMC, and the installation of a dry stack tailings facility at El Cubo and the expecting timing and cost for the completion
thereof; the Company’s ability to maintain and improve operating efficiencies at its mining operations in 2023 and to
continue to reduce its reliance on third party mining contractors; the ability of the newly restarted Cata mill to process all
of the mineralized material mined from San Ignacio and VMC in the volumes and grades anticipated; and the Company’s
status as one of the fastest growing silver producers in Mexico.
Such fo rward -looking statements and information reflect management's current beliefs and expectations and are based
on information currently available to and assumptions made by the Company; which assumptions, while considered
reasonable by the Company, are inherently subject to significant operational, business, economic and regulatory
uncertainties and contingencies. These assumptions include: our estimates of mineralized material at El Cubo, VMC, San
Ignacio and Topia and the assumptions upon which they are based, including geotechnical and metallurgical
characteristics of rock conforming to sampled results and metallurgical performance; available tonnage of mineralized
material to be mined and processed; resource grades and recoveries; assumptions and discount rates being appropriately
applied to production estimates; the ability of the Company to ramp up processing of mineralized material at its processing
plants at the projected rates and source sufficient high grade mineralized material to fill such processing capacity; prices
for silver, gold and other metals remaining as estimated; currency exchange rates remaining as estimated; availability of
funds for the Company's projects and to satisfy current liabilities and obligations including debt repayments; capital cost
estimates; decommissioning and reclamation estimates; prices for energy inputs, labour, materials, supplies and services
(including transportation) and inflation rates remaining as estimated; no l abour-related disruptions; no unplanned delays
or interruptions in scheduled construction and production; all necessary permits, licenses and regulatory approvals
are received in a timely manner; and the ability to comply with environmental, health and safety laws. The foregoing list
of assumptions is not exhaustive.
Readers a re cautioned that such forward-looking statements and information are neither promises nor guarantees, and
are subject to risks and uncertainties that may cause future results, level of activity, production levels, performance or
achievements of GSilver to differ materially from those expected including, but not limited to, market conditions,
availability of financing, future prices of gold, silver and other metals, currency rate fluctuations, rising inflation and
interest rates, actual results of production, exploration and development activities, actual resource grades and recoveries
of silver, gold and other metals, availability of third party mineralized material for processing, unanticipated geological or
structural formations and characteristics, geopolitical conflicts including wars, environmental risks, operating risks,
accidents, labor issues, equipment or personnel delays, delays in obtaining governmental or regulatory approvals and
permits, inadequate insurance, and other risks in the mining industry. There are no assurances that GSilver will be able to
successfully discover and mine sufficient quantities of high grade mineralized material at El Cubo, VMC, San Ignacio and
Topia for processing at its existing mills to increase production, tonnage milled and recoveries rates of gold, silver, and
other metals in the amounts, grades, recoveries, costs and timetable anticipated. In addition, GSilver’s d ecision to process
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mineralized material from El Cubo, VMC, San Ignacio, Topia and its other mines is not based on a feasibility study of
mineral reserves demonstrating economic and technical viability and therefore is subject to increased uncertainty and risk
of failure, both economically and technically. Mineral resources and mineralized material that are not Mineral Reserves
do not have demonstrated economic viability, are considered too speculative geologically to have the economic
considerations applied to them, and may be materially affected by environmental, permitting, legal, title, socio-political,
marketing, and other relevant issues. There are no assurances that the Company's projected production of silver, gold and
other metals will be realized. In addition, there are no assurances that the Company will meet its production forecasts or
generate the anticipated cash flows from operations to satisfy its scheduled debt payments or other liabilities when due
or meet financial covenants to which the Company is subject or to fund its exploration programs and corporate initiatives
as planned. There is also uncertainty about the continued spread and severity of COVID-19, the ongoing war in Ukraine,
inflation and rising interest rates and the impact they will have on the Company's operations, supply chains, a bility to
access mining projects or procure equipment, supplies, contractors and other personnel on a timely basis or at all and
economic activity in general. Accordingly, readers s hould not place undue reliance on forward-looking statements or
information. All forward-looking statements and information made in this news release are qualified by these cautionary
statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com including the Company’s
most recently filed annual information form. These forward-looking statements and information are made as of the date
hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances
save as required by law.