PAN AMERICAN SILVER CORP. 1 Pan American Silver Reports First Quarter 2019 Results Guidance Updated to Include Mines Acquired Through Tahoe Transaction
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 1
Pan American Silver Reports First Quarter 2019 Results
Guidance Updated to Include Mines Acquired Through Tahoe Transaction
Vancouver, B.C. - May 8, 2019 - Pan American Silver Corp. (NASDAQ: PAAS) (TSX: PAAS) today reported unaudited
results for the first quarter ended March 31, 2019 ("Q1 2019"). Pan American Silver’s unaudited condensed interim
consolidated financial statements and notes ("financial statements"), as well as Pan American Silver’s
Management's Discussion and Analysis ("MD&A") for the three months ended March 31, 2019, are available on
Pan American Silver’s website at panamericansilver.com and on SEDAR at www.sedar.com.
Pan American Silver completed its previously announced acquisition of all of the issued and outstanding shares of
Tahoe Resources Inc. ("Tahoe") on February 22, 2019. Pan American Silver's consolidated financial and operating
results for the first quarter of 2019 reflect the contribution from the Tahoe mines (the "Acquired Mines") from
February 22, 2019 onwards.
• Net income of $33.8 million, equivalent to $0.19 basic earnings per share
• Adjusted income of $8.7 million, equivalent to $0.05 basic adjusted income per share
• Revenue of $232.6 million
• Production on track to achieve annual guidance
“Our mines delivered solid results in the first quarter, despite soft precious metal prices, generating $61.4 million
in operating cash flow before interest, taxes and working capital changes," said Michael Steinmann, President and
Chief Executive Officer. "After closing the Tahoe transaction in February, Pan American is now a larger, more
diversified company with enhanced growth prospects. As we integrate these new assets into our portfolio, we are
focused on capturing synergies and maintaining low-cost, efficient operations across the company."
"The La Colorada skarn exploration program continues to return wide, high-grade intersects and we are looking
forward to advancing this discovery towards releasing a first resource estimate later in the year. We also plan on
commencing production from our COSE and Joaquin mines in Argentina in the second half of 2019," added Mr.
Steinmann.
Consolidated Q1 2019 Highlights:
• Silver production was 6.1 million ounces, which was in line with management's annual guidance.
• Gold production was 80.5 thousand ounces, which was an increase reflecting the 38-day contribution from
the Acquired Mines since acquisition.
• Zinc, lead and copper production were 16.8 thousand tonnes, 6.5 thousand tonnes, and 2.0 thousand
tonnes, respectively. Base metal production is on track to achieve annual 2019 production guidance.
• Cash Costs(1) were $1.80 per ounce, reflecting the contribution of by-product gold credits from the
Acquired Mines.
• All-in sustaining costs per ounce sold ("AISC")(1) were $10.45 per ounce, including net realizable value
("NRV") inventory adjustments that increased costs by $1.33 per ounce.
• Net cash used in operating activities of $12.9 million reflects $33.8 million in tax payments and a $37.9
million use of cash from working capital changes, mostly from closing costs related to the Tahoe
acquisition.
• At March 31, 2019, the Company had a cash and short-term investment balance of $121.6 million and
$165.0 million available under its $500.0 million revolving credit facility. Working capital of $771.7 million
included $376.4 million of net assets relating to the Bell Creek and Timmins mines, which are being
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 2
classified as discontinued operations "held-for-sale" and thus included in working capital as at March 31,
2019. Total debt was $363.1 million, reflecting $335.0 million drawn on the credit facility in Q1 2019 to
fund, in part, the cash purchase price for the Tahoe acquisition and to repay Tahoe's revolving credit
facility, under which $125.0 million was outstanding at the date of acquisition. Total debt also includes
$28.1 million in lease liabilities, the majority of which followed from the application of the new IFRS 16
rules.
• Drilling at the newly discovered skarn deposit at La Colorada continues to return exceptional results with
wide intersects of polymetallic mineralization; further details are provided below.
• The shaft upgrade to 1,080 metres at the Bell Creek mine in Canada was completed in February and is
performing at full capacity with limited material being transported via the mine ramp.
• The Board of Directors has approved a cash dividend of $0.035 per common share, or approximately $7.3
million in aggregate cash dividends, payable on or about June 3, 2019, to holders of record of Pan
American Silver’s common shares as of the close on May 21, 2019. Pan American Silver's dividends are
designated as eligible dividends for the purposes of the Income Tax Act (Canada). As is standard practice,
the amounts and specific distribution dates of any future dividends will be evaluated and determined by
the Board of Directors on an ongoing basis.
(1) New Cost Reporting Measures
As a result of the Tahoe acquisition and the Company now operating three primary gold mines, we have revised
reporting of Cash Costs and AISC to reflect a Silver Segment, a Gold Segment and on a Consolidated Silver Basis.
Silver segment Cash Costs and AISC are calculated net of credits for realized revenues from all metals other than
silver ("silver segment by-product credits"), and are calculated per ounce of silver sold. Gold segment Cash Costs
and AISC are calculated net of credits for realized silver revenues ("gold segment by-product credits"), and are
calculated per ounce of gold sold. Consolidated Cash Costs and AISC are based on total silver ounces sold and are
net of by-product credits from all metals other than silver ("silver basis consolidated by-product credits").
Consolidated AISC includes Corporate general and administrative expense, and Exploration and project
development expense. The "Cash Costs and AISC" table in this news release provides the segmented costs. For
more information on these measures, please see the "Alternative Performance (non-GAAP) Measures" section of
the MD&A for the period ended March 31, 2019.
Cash Costs, AISC, adjusted earnings, basic adjusted earnings per share, working capital and total debt are not
generally accepted accounting principle ("non-GAAP") financial measures. Please refer to the "Alternative
Performance (non-GAAP) Measures" section of this news release for further information on these measures.
La Colorada exploration drilling
Exploration of the skarn mineralization at La Colorada continues at depth with over 7,200 metres drilled in Q1
2019. Hole U-26-19 drilled on the same section as drill hole U-68-18 (reported in Pan American Silver's news
release dated February 20, 2019, with 308 metres of polymetallic mineralization) shows multiple thick widths of
mineralized skarn over 270 metres wide. Pan American Silver's understanding of this large mineralized system
continues to evolve, as the Company works toward developing a first resource estimate late in 2019.
Recent drill highlights include:
• U-86-18: 24.5 m at 37 g/t Ag, 0.28% Cu, 1.95% Pb, 4.27% Zn;
• and 8.7 m at 25 g/t Ag, 0.08% Cu, 3.41% Pb, 4.97% Zn
• U-08-19: 61.1 m at 80 g/t Ag, 0.23% Cu, 0.41% Pb, 3.27% Zn
• U-12-19: 22.1 m at 131 g/t Ag, 0.43% Cu, 0.59% Pb, 3.24% Zn
• U-22-19: 129.2 m at 45 g/t Ag, 0.10% Cu, 1.09% Pb, 4.02% Zn;
• including 84.5 m at 63 g/t Ag, 0.13% Cu, 1.27% Pb, 5.18% Zn
• U-26-19: 276.1 m at 34 g/t Ag, 0.18% Cu, 1.69% Pb, 3.76% Zn;
• including 47 m at 31 g/t Ag, 0.17% Cu, 2.49% Pb, 4.40% Zn;
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 3
• including 151.9 m at 38 g/t Ag, 0.20% Cu, 1.73% Pb, 4.22% Zn;
• including 33.2 m @ 53 g/t Ag, 0.26% Cu, 2.32% Pb, 5.23% Zn
A summary of the drill results from the recently completed 7,200 metres of drilling is provided at the end of this
new release. Results from hole U-22-19 are incomplete, as drilling continues on this hole.
CONSOLIDATED FINANCIAL RESULTS
March 31,
2019
December 31,
2018
Weighted average shares during period (millions) Basic 176.5 153.3
Shares outstanding end of period (millions) 209.4 153.4
Three months ended
March 31,
2019 2018
Revenue $232,643 $206,961
Mine operating earnings $17,194 $55,124
Net earnings $33,812 $48,156
Basic earnings per share (1) $0.19 $0.31
Adjusted earnings (2) $8,705 $30,702
Basic earnings per share (1) $0.05 $0.20
Net cash (used in) generated from operating activities $(12,911) $34,400
Net cash generated from operating activities before changes
in working capital (2) $25,025 $45,720
Sustaining capital expenditures $34,742 $23,903
Project capital expenditures $9,874 $10,078
Cash dividend per share $0.035 $0.035
Average realized prices
Silver ($/ounce) (3) 15.52 16.78
Gold ($/ounce) (3) 1,300 1,333
Zinc ($/tonne) (3) 2,750 3,468
Lead ($/tonne) (3) 2,039 2,458
Copper ($/tonne) (3) 6,207 6,993
(1) Per share amounts are based on basic weighted average common shares.
(2) Non- GAAP measures: adjusted earnings, basic adjusted earnings per share, net cash generated from operating activities before changes in working
capital are non-GAAP financial measures. Please refer to the "Alternative Performance (non-GAAP) Measures" section of this news release for further
information on these measures.
(3) Metal prices stated are inclusive of final settlement adjustments on concentrate sales.
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 4
OPERATING PERFORMANCE
Silver and Gold Production
The following table provides silver and gold production at each of Pan American Silver’s operations for the three
month periods ended March 31, 2019 and 2018, except for the Acquired Mines, which only include production
from February 22, 2019 to March 31, 2019:
Silver Production
(ounces ‘000s)
Gold Production
(ounces ‘000s)
Three months ended
March 31,
Three months ended
March 31,
2019 2018 2019 2018
Silver Segment:
La Colorada 1,990 1,650 1.0 1.0
Dolores 1,112 1,202 30.0 34.3
Huaron 937 930 0.2 0.2
Morococha(1) 697 731 0.6 0.8
San Vicente(2) 851 764 0.1 0.1
Manantial Espejo/COSE/Joaquin 524 825 4.9 9.7
Gold Segment:
La Arena(3) 3 14.7
Shahuindo(3) 10 14.5
Assets held for sale:
Timmins (3) 2 14.4
Total (4) 6,125 6,102 80.5 46.2
(1) Morococha data represents Pan American Silver's 92.3% interest in the mine's production.
(2) San Vicente data represents Pan American Silver's 95.0% interest in the mine's production.
(3) Reflects production results subsequent to the February 22, 2019 closing date of the Acquisition to March 31, 2019. Please refer to the "Acquisition of
Tahoe" section of the MD&A for the period ended March 31, 2019 for more information. The Bell Creek and Timmins mines (together, "Timmins") are
classified as assets-held-for sale in the Company's Q1 2019 Financial Statements, as described in Note 4 of the Company's Q1 2019 Financial Statements
and in the "Acquisition of Tahoe" section of the MD&A for the period ended March 31, 2019.
(4) Totals may not add due to rounding.
Base Metal Production
Three months ended
March 31,
2019 2018
Zinc - kt 16.8 14.7
Lead - kt 6.5 5.2
Copper - kt 2.0 3.0
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 5
Cash Costs and AISC
The following table reflects the Cash Costs and AISC net of by-product credits at each of Pan American Silver’s
operations for the three months ended March 31, 2019, as compared to the same periods in 2018 for the Silver
Segment mines and 38 days (February 22, 2019 through March 31, 2019) for the newly acquired Gold Segment
mines:
Cash Costs(1)
($ per ounce)
AISC(1)
($ per ounce)
Three months ended
March 31,
Three months ended
March 31,
2019 2018(2) 2019 2018(3)
La Colorada 2.16 (0.11) 3.37 1.87
Dolores 3.34 (2.14) 26.45 10.02
Huaron 4.38 (1.07) 8.54 2.95
Morococha (1.01) (10.18) 2.20 (6.89)
San Vicente 10.25 9.48 11.20 11.43
Manantial Espejo/COSE/Joaquin 27.53 17.14 27.94 11.43
Silver Segment Consolidated 5.46 1.47 10.83 5.19
Shahuindo 616 — 657 —
La Arena 642 — 1,263 —
Timmins(4) 976 — 1,116 —
Gold Segment Consolidated 768 — 1,082 —
Consolidated metrics per silver ounce sold(5):
All Operations 1.80 1.47 10.45 6.55
All Operations before NRV inventory adjustments 1.80 1.47 9.12 7.48
(1) Cash Costs and AISC are non-GAAP measures. Please refer to the section “Alternative Performance (Non-GAAP) Measures” of the MD&A for the period
ended March 31, 2019 for a detailed description of these measures and where appropriate a reconciliation of the measures to the Q1 2019 Financial
Statements. G&A costs are included in the consolidated AISC, but are not allocated in calculating AISC for each operation.
(2) Silver Segment Cash Costs per ounce sold are calculated based on Cash Costs, net of by-product credits divided by per ounce of silver sold and they are
therefore different from previously reported Q1 2018 "Cash Costs", which were calculated based on cash costs net of by-product credits divided by
payable silver ounces produced. The Q1 2018 cash costs per ounce sold included in the table above have been calculated and presented as comparative
amounts to conform to the methodology used by the Company to calculate the Q1 2019 Cash Costs per ounce sold.
(3) 2018 AISC per ounce sold in the table above have been calculated and presented as comparative amounts to conform to the methodology used by the
Company to calculate the 2019 AISC per ounce sold. The change in methodology relates to the sustaining capital calculation to account for the adoption
of IFRS 16, with sustaining capital now including lease payments. Previously, leased assets were included as sustaining capital in the period of
acquisition, while future related lease payments were excluded.
(4) The Bell Creek and Timmins mines (together, "Timmins") are classified as assets-held-for sale in the Company's Q1 2019 Financial Statements, as
described in the "Acquisition of Tahoe" section of the MD&A for the period ended March 31, 2019.
(5) Consolidated silver basis total is calculated per silver ounce sold with gold revenues included within by-product credits.
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 6
2019 GUIDANCE
The following table provides our guidance for 2019, which has been updated to include certain forecast amounts
for the Acquired Mines from February 22, 2019 to December 31, 2019. The production in 2019 reflects a full year
of production for the Silver Segment mines and from February 22, 2019 to December 31, 2019 for the Gold
Segment mines. These estimates are forward-looking statements and information that are subject to the
cautionary note associated with forward-looking statements and information at the end of this news release.
Silver Production
(million ounces)
Gold Production
(thousand ounces)
Cash Costs
($ per ounce)(1) AISC ($ per ounce)(1)
Silver Segment
La Colorada 8.0 - 8.2 4.1 - 4.8 2.50 - 3.50 3.50 - 4.50
Dolores 5.2 - 5.5 114.5 - 120.0 4.50 - 5.50 14.00 - 16.00
Huaron 3.6 - 3.7 0.5 6.00 - 7.00 7.50 - 9.25
Morococha (92.3%)(2) 2.8 - 2.9 1.2 - 1.5 3.10 - 4.00 7.00 - 9.00
San Vicente (95.0%)(3) 3.5 - 3.7 0.3 10.60 - 11.50 12.25 - 13.50
Manantial Espejo/COSE/Joaquin 3.4 - 3.6 42.0 - 45.0 17.00 - 18.50 17.75 - 19.50
Total(4) 26.5 - 27.5 162.5 - 172.5 6.50 - 7.50 9.75 - 11.25
Gold Segment:
Shahuindo 0.1 135.0 - 165.0 550 - 625 875 - 1,000
La Arena — 117.5 - 122.5 800 - 850 1,275 - 1,325
Timmins(5) — 155.0 - 160.0 890 - 940 1,025 - 1,075
Total(4) 0.1 407.5 - 447.5 740 - 810 1,025 - 1,125
Total Production(6) 26.6 - 27.6 570.0 - 620.0 — —
Consolidated Silver Basis — — (2.25) - 0.50 7.75 - 10.75
(1) Cash Costs and AISC are non-GAAP measures. Please refer to the section “Alternative Performance (Non-GAAP) Measures” of the MD&A for the
period ended March 31, 2019, for a detailed description of these measures and where appropriate a reconciliation of the measure to the Q1 2019
Financial Statements. The Cash Costs and AISC forecasts assume metal prices of $14.50/oz for silver, $2,600/tonne ($1.18/lb) for zinc, $1,950/tonne
($0.88/lb) for lead, $6,150/tonne ($2.79/lb) for copper, and $1,250/oz for gold; and average annual exchange rates relative to 1 USD of 19.50 for the
Mexican peso ("MXN"), 3.33 of the Peruvian sol ("PEN"), 41.80 for the Argentine peso ("ARS"), 6.91 for the Bolivian boliviano ("BOL"), and $1.30 for
the Canadian dollar ("CAD").
(2) Morococha data represents Pan American Silver’s 92.3% interest in the mine's production.
(3) San Vicente data represents Pan American Silver’s 95.0% interest in the mine's production.
(4) As shown in the detailed quantification of consolidated AISC, included in the “Alternative Performance (Non-GAAP) Measures” section of the MD&A
for the period ended March 31, 2019, Corporate general and administrative expense, and Exploration and project development expense are included
in Consolidated (silver basis) AISC, though are not allocated amongst the operations and thus are not included in either the silver or gold segment
totals.
(5) The Bell Creek and Timmins mines (together, "Timmins") are classified as assets held for sale in the Company's Q1 2019 Financial Statements, as
described in the Note 4 of the Company's Q1 2019 Financial Statements, and in the "Acquisition of Tahoe" section of the MD&A for the period ended
March 31, 2019. The gold production from the Timmins operations is included in the consolidated guidance, pending resolution from the sale
process.
(6) Totals may not add due to rounding.
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 7
Updated 2019 Capital Expenditure Guidance
The following table summarizes the Q1 2019 capital expenditures and updated 2019 guidance, which includes the
Acquired Mines.
(in millions of USD) Q1 2019 Actual Updated 2019 Guidance
La Colorada 2.2 6.5 - 7.0
Dolores 13.1 53.0 - 54.0
Huaron 3.2 6.5 - 7.5
Morococha 1.9 11.0 - 12.0
San Vicente 1.0 6.5 - 7.5
Manantial Espejo 0.7 1.5 - 2.0
Shahuindo 0.2 47.5 - 49.0
La Arena 10.5 54.0 - 56.0
Timmins(1) 1.9 16.5 - 18.0
Sustaining Capital Sub-total(1) 34.7 203.0 - 213.0
Morococha projects 0.1 2.5
Mexico projects 2.0 7.5
Joaquin and COSE projects 5.9 20.0
Acquired Mines projects(1) 1.9 10.0
Project Capital Sub-total(1) 9.9 40.0
Total Capital 44.6 243.0 - 253.0
(1) The Timmins mines are classified as assets-held-for sale in the Company's Q1 2019 Financial Statements, as described in Note 4 of the Company's Q1
2019 Financial Statements, and in the "Acquisition of Tahoe" section of the MD&A for the period ended March 31, 2019. The capital expenditures for the
Timmins' operations are included in the consolidated guidance pending resolution from the sale process.
Q1 2019 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in thousands of U.S. dollars except number of shares and per share amounts.
PAN AMERICAN SILVER CORP. 8
La Colorada Drill Results
A summary of results from the recently completed 7,200 metres of drilling at La Colorada is provided in the
following table(1)(2):
Drill hole ID From (m) To (m) Interval (m) Ag g/t Cu% Pb% Zn%
U-86-18 57.6 57.7 0.2 46,654 0.49 1.82 1.62
and 160.7 161.6 0.9 944 0.56 2.36 3.73
and 273.9 289.4 15.5 19 0.10 1.74 4.32
and 323.3 347.8 24.5 37 0.28 1.95 4.27
and 451.9 554.1 102.2 20 0.09 1.70 2.91
incl. 451.9 506.9 55.0 16 0.04 1.71 3.16
incl. 530.1 547.5 17.4 30 0.04 2.62 3.90
and 661.8 670.5 8.7 25 0.08 3.41 4.97
U-01-19 90.1 94.4 4.4 297 0.19 1.15 2.44
and 409.7 414.3 4.6 121 0.04 5.38 4.57
and 630.4 634.1 3.7 149 0.24 0.60 0.47
U-10-19 706.0 708.6 2.5 37 0.22 0.79 11.35
and 743.8 748.2 4.5 39 0.15 0.86 5.83
and 762.7 766.7 4.1 64 0.07 0.48 4.40
U-08-19 230.7 245.3 14.6 51 0.25 2.88 5.97
and 472.1 474.7 2.6 824 0.06 10.91 11.87
and 551.8 567.9 16.1 44 0.11 4.22 8.03
and 616.9 657.7 40.8 37 0.12 0.83 3.44
and 677.1 738.2 61.1 80 0.23 0.41 3.27
and 771.4 784.5 13.1 42 0.21 0.14 4.06
and 793.5 895.7 102.2 15 0.16 0.34 3.14
incl. 793.5 815.3 21.8 21 0.12 1.56 4.99
U-12-19 110.9 140.4 29.5 47 0.28 1.46 3.11
and 657.7 669.4 11.7 98 0.22 1.47 5.72
and 718.1 800.8 82.7 61 0.25 0.56 2.34
incl. 718.1 740.2 22.1 131 0.43 0.59 3.24
incl. 769.6 795.1 25.5 61 0.24 0.92 4.11
and 884.8 887.6 2.8 753 1.03 4.82 6.48
U-22-19 41.8 60.6 18.8 93 0.24 5.43 4.99
and 106.7 121.9 15.2 87 0.20 2.02 6.13
and 648.7 777.9 129.2 45 0.10 1.09 4.02
incl. 693.4 777.9 84.5 63 0.13 1.27 5.18
U-26-19 441.0 475.8 34.8 20 0.06 1.71 3.02
and 482.7 501.4 18.8 21 0.09 1.74 2.93
and 536.3 812.3 276.1 34 0.18 1.69 3.76
incl. 536.3 583.2 47.0 31 0.17 2.49 4.40
incl. 593.0 744.9 151.9 38 0.20 1.73 4.22
incl. 779.2 812.3 33.2 53 0.26 2.32 5.23
(1) The exploration drilling, sampling, and analytical data have been reviewed, verified, and compiled by Pan American Silver’s geology staff
under the supervision of, or were reviewed by, Christopher Emerson, FAusIMM, Vice President Business Development and Geology, who
is a Qualified Persons as that term is defined in National Instrument 43-101 (“NI 43-101").
(2) True widths of the mineralized intervals are unknown at this time.