SVM.TO · 2018-11-07 12:00:00

ISCAL YEAR 20 Sales of $48.1 Sold approxim up by 17%, 25 16.9 million p compared to concentrate w

Financials

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Sales in Q2 Fiscal 2019 were $48.1 million, up 1% compared to $47.5 million in Q2 Fiscal 2018. Silver and

gold sales represented $23.4 million and $1.0 million, respectively, while base metals represented $23.6

million of total sales, compared to silver, gold and base metals sales of $22.6 million, $0.9 million, and

$24.1 million, respectively, in Q2 Fiscal 2018.

The Company’s financial results in Q2 Fiscal 2019 were mainly impacted by i) a decrease of 11%, 4%, 8%,

and 18% in the realized selling prices for silver, gold, lead and zinc, respectively compared to Q2 Fiscal

2018, and ii) an increase of 17% and 15% of silver and lead sold.

Cost of sales in Q2 Fiscal 2019 was $25.4 million compared to $21.9 million in Q2 Fiscal 2018. The cost of

sales included $18.2 million (Q2 Fiscal 2018 ‐ $16.2 million) cash production costs, $1.4 million mineral

resources tax (Q2 Fiscal 2018 ‐ $1.3 million), and $5.8 million (Q2 Fiscal 2018 ‐ $4.4 million) depreciation

and amortization charges. The increase in cash production costs and depreciation and amortization

charges was mainly due to more metals sold in the current quarter while the increase in mineral

resources tax was due to higher sales achieved in Q2 Fiscal 2019. The cash production costs expensed in

cost of sales represent approximately 275,000 tonnes of ore processed and expensed at costs of $66.33

per tonne (Q2 Fiscal 2018 – approximately 246,600 tonnes at $65.61 per tonne)

Gross profit margin in Q2 Fiscal 2019 was 47%, compared to 54% in Q2 Fiscal 2018, with the decrease

mainly due to the decrease in metal selling prices. Ying Mining District’s gross profit margin was 50%

compared to 56% in Q2 Fiscal 2018. GC Mine’s gross profit margin was 29% compared to 40% in Q2 Fiscal

2018.

General and administrative expenses in Q2 Fiscal 2019 were $4.6 million, a slight increase compared to

$4.5 million in Q2 Fiscal 2018. Excluding non‐cash share‐based compensation and amortization expense,

general and administrative expenses in Q2 Fiscal 2019 were $3.9 million, comparable to $3.9 million in Q2

Fiscal 2018.

Income tax expenses in Q2 Fiscal 2019 were $5.8 million compared to $5.3 million in Q2 Fiscal 2018. The

income tax expense recorded in Q2 Fiscal 2019 included current income tax expense of $5.1 million (Q2

Fiscal 2018 – $4.5 million) and deferred income tax expense of $0.7 million (Q2 Fiscal 2018 – $1.0 million).

The current income tax expenses include $1.1 million withholding tax (Q2 Fiscal 2018 –$nil), being 10% of

the dividends distributed out of China to the Company by the Company’s Chinese subsidiaries.

Cash flows provided by operating activities in Q2 Fiscal 2019 were $21.0 million, a slight increase

compared to $20.7 million in Q2 Fiscal 2018.

For the six months ended September 30, 2018, net income attributable to equity shareholders of the

Company was $19.0 million or $0.11 per share, an effective increase of $1.2 million or 7% over the same

prior year period, which was $17.8 million or $0.10 per share after excluding a one‐time gain on the sale

of a Net Smelter Royalty, which increased the actual net income to shareholders to $22.1 million or $0.13

per share in the same prior year period; sales were $93.2 million, up 7% from $87.2 million in the same

prior year period; and cash flows from operating activities were $42.2 million, up 12% from $37.6 million

in the same prior year period.

The Company ended the period with $123.9 million in cash and short‐term investments, an increase of

$9.1 million or 8% compared to $114.8 million as at June 30, 2018.

Working capital as at September 30, 2018 was $98.7 million, an increase of $4.5 million or 5%, compared

to $94.2 million working capital as at June 30, 2018.

OPERATIONS AND DEVELOPMENT

(i) Q2 Fiscal 2019 vs. Q2 Fiscal 2018

In Q1 Fiscal 2019, on a consolidated basis, the Company mined 248,419 tonnes of ore, an increase of 4%

or 9,313 tonnes, compared to 239,106 tonnes in Q2 Fiscal 2018. Ore mined at the Ying Mining District

increased by 4% or 7,368 tonnes, and ore mined at the GC Mine increased by 3% or 1,945 tonnes. Ore

milled were 239,728 tonnes, up 1% compared to 237,594 tonnes of ore milled in Q2 Fiscal 2018. Ending

stockpiled ore inventory as at September 30, 2018 was 21,362 tonnes, up 75% compared to 12,234

tonnes as at March 31, 2018.

In Q2 Fiscal 2019, the Company sold approximately 1.9 million ounces of silver, 1,000 ounces of gold, and

19.4 million pounds of lead, up by 17%, 25%, and 15%, respectively, compared to 1.6 million ounces of

silver, 800 ounces of gold, 16.9 million pounds of lead in Q2 Fiscal 2018 while zinc sold was 4.9 million

pounds, down 12% compared to 5.6 million pounds in Q2 Fiscal 2018. As at September 30, 2018,

inventories of silver‐lead concentrate were 3,732 tonnes and zinc concentrate inventories were 598

tonnes, compared to inventories of 4,070 tonnes of silver‐lead concentrate and 370 tonnes of zinc

concentrate as at March 31, 2018.

In Q2 Fiscal 2019, the consolidated total mining costs and cash mining costs were $72.71 and $53.90 per

tonne, compared to $70.58 and $52.77 per tonne, respectively, in Q2 Fiscal 2018. The 2% increase in the

cash mining costs per tonne comparing to Q2 Fiscal 2018 was mainly due to more tunnelling expensed at

the GC Mine in the current quarter. The consolidated total milling costs and cash milling costs in Q2 Fiscal

2019 were $11.60 and $9.36 per tonne, down 7% and 8% compared to $12.44 and $10.14 per tonne,

respectively, in Q2 Fiscal 2018.

Correspondingly, the consolidated total and cash production costs per tonne of ore processed in Q2 Fiscal

2019 increased slightly by 2% and 1% to $87.38 and $66.33, respectively, from $85.72 and $65.61 in Q2

Fiscal 2018, but the consolidated cash production costs per tonne is 6% lower than the annual guidance of

$70.20.

In Q2 Fiscal 2019, the consolidated total production costs and cash costs per ounce of silver, net of by‐

product credits, were negative $0.34 and negative $3.37 compared to negative $2.43 and negative $5.16

respectively in Q2 Fiscal 2018. The increase in the cash cost per ounce of silver, net of by‐product credits,

is mainly due to a 14% decrease in by‐product credits per ounce of silver, mainly arising from 8% and 18%

decrease in the realized lead and zinc selling price. Sales from lead and zinc accounted for 48% of the

total sales and amounted to $23.2 million, a decrease of $0.7 million, compared to $23.9 million in the Q2

Fiscal 2018.

The consolidated all‐in sustaining cost per ounce of silver, net of by‐product credits is $2.54 compared to

$2.26 in Q2 Fiscal 2018.

(ii) Six months ended September 30, 2018 vs. Six months ended September 30, 2017

For the six months ended September 30, 2018, on a consolidated basis, the Company mined 485,117

tonnes of ore, an increase of 4% or 20,739 tonnes, compared to 464,378 tonnes mined in the same prior

year period. In the same comparative period, ore milled increased 2% to 477,468 tonnes compared to

468,496 tonnes.

For the six months ended September 30, 2018, the Company sold approximately 3.4 million ounces of

silver, 1,700 ounces of gold, 34.3 million pounds of lead, and 11.3 million pounds of zinc, compared to 3.1

million ounces of silver, 1,700 ounces of gold, 32.8 million of lead, and 10.6 million pounds of zinc sold in

the same prior year period.

The consolidated total mining and cash mining costs were $74.40 and $55.05 per tonne, an increase of 7%

and 7%, compared to $69.39 and $51.57 per tonne in the same prior year period while the consolidated

total milling cost and cash milling cost were $12.87 and $10.54, an increase of 3% and 4%, respectively,

compared to $12.45 and $10.13 per tonne in the same prior year period.

The consolidated total production costs and cash production costs per tonne of ore processed for the six

months ended September 30, 2018 were $90.23 and $68.55, an increase of 7% and 6%, respectively,

compared to $84.62 and $64.48 in the same prior year period, but the consolidated cash production costs

per tonne is 2% lower than the annual guidance of $70.20.

The consolidated cash production costs and all‐in sustaining costs per ounce of silver, net of by‐product

credits, were negative $5.18 and $1.61 compared to negative $4.51 and $3.44, respectively, in the same

prior year period.

1. Ying Mining District, Henan Province, China

Q2 Fiscal 2019 vs. Q2 Fiscal 2018

In Q2 Fiscal 2019, the total ore mined at the Ying Mining District was 180,662 tonnes, an increase of 4% or

7,368 tonnes, compared to 173,294 tonnes mined in Q2 Fiscal 2018. Ore milled was 172,200 tonnes, a

decrease of 1% or 1,746 tonnes compared to 173, 946 tonnes in Q2 Fiscal 2018. As at September 30, 2018,

stockpile ore at the Ying Mining District was 19,269 tonnes, an increase of 10,742 tonnes compared to

8,257 tonnes as at March 31, 2018.

Head grades of ore milled at the Ying Mining District in Q2 Fiscal 2019 were 308 grams per tonne (“g/t”)

for silver, 4.6% for lead, and 0.9% for zinc, compared to 294 g/t for silver, 4.3% for lead and 0.8% for zinc

in Q2 Fiscal 2018. The Company continues to achieve good dilution control using its “Enterprise Blog” to

assist and manage daily operations.

In Q2 Fiscal 2019, the Ying Mining District sold approximately 1.8 million ounces silver, 17.4 million

pounds lead, and 1.6 million pounds zinc, compared to 1.5 million ounces silver, 15.3 million pounds lead,

and 2.3 million pounds of zinc in Q2 Fiscal 2018. As at September 30, 2018, inventories of silver‐lead

concentrate at the Ying Mining District were 3,452 tonnes and zinc concentrate inventories were 230

tonnes, compared to inventories of 4,050 tonnes of silver‐lead concentrate and 350 tonnes of zinc

concentrate as at March 31, 2018.

Total and cash mining costs per tonne at the Ying Mining District in Q2 Fiscal 2019 were $81.50 and

$58.65 per tonne, respectively, comparable to $81.20 and $59.67 per tonne in Q2 Fiscal 2018. Total and

cash milling costs per tonne at the Ying Mining District in Q2 Fiscal 2019 were $10.47 and $8.54, also

comparable to $10.45 and $8.50 in Q2 Fiscal 2018.

Correspondingly, the total production costs and cash production costs per tonne of ore processed in Q2

Fiscal 2019 at the Ying Mining District were $96.23 and $71.45, compared to $95.33 and $71.85 in Q2

Fiscal 2018, and the cash production costs of $71.45 per tonne is 5% lower than the annual guidance of

$75.40.

Cash cost per ounce of silver, net of by‐product credits, in Q2 Fiscal 2019 at the Ying Mining District, was

negative $2.80 compared to negative $4.27 in the prior year quarter. The increase in the cash cost per

ounce of silver, net of by‐product credits, is mainly due to a 15% decrease in by‐product credits per once

of silver, mainly arising from 8% and 20% decreases in lead and zinc realized selling price. All in sustaining

costs per ounce of silver, net of by‐product credits, in Q2 Fiscal 2019 at the Ying Mining District was $1.52

compared to $1.08 in the prior year quarter. The increase was mainly due to the cash cost per ounce of

silver, net of by‐product credits as discussed above.

In Q2 Fiscal 2019, approximately 22,672 metres or $0.5 million worth of underground diamond drilling

Operational results ‐ Ying Mining District

Q2 2019 Q1 2019 Q4 2018 Q3 2018 Q2 2018

September 30, 2018 June 30, 2018 March 31, 2018 December 31, 2017 September 30, 2017 2018 2017

Ore Mined (tonne) 180,662 156,730 113,820 166,619 173,294 337,393 333,701

Ore Milled (tonne) 172,200 155,929 112,285 167,543 173,946 328,129 338,904

Head Grades

Silver (gram/tonne) 308 323 309 315 294 315 299

Lead (%) 4.6 4.5 4.3 4.5 4.3 4.6 4.4

Zinc (%) 0.9 1.1 1.0 1.0 0.8 1.0 0.8

Recoveries

Silver (%) 96.1 96.0 95.9 95.8 95.6 96.1 95.7

Lead (%) 95.6 96.3 96.5 96.4 96.2 95.8 96.3

Zinc (%) 51.2 54.5 54.5 57.3 50.7 52.9 48.4

Metal Sales

Silver (in thousands of ounce) 1,765 1,313 1,319 1,322 1,472 3,078 2,796

Gold (in thousands of ounce) 1.0 0.7 0.7 0.7 0.8 1.7 1.7

Lead (in thousands of pound) 17,359 13,313 12,649 13,487 15,279 30,672 29,044

Zinc (in thousands of pound) 1,648 2,133 1,106 2,006 2,269 3,781 3,024

Cash mining costs ($ per tonne) 58.65 63.49 65.88 66.71 59.67 62.15 57.32

Total mining costs ($ per tonne) 81.50 89.57 92.81 90.12 81.20 86.50 79.03

Cash milling costs ($ per tonne) 8.54 10.30 12.59 9.84 8.50 9.37 8.29

Total milling costs ($ per tonne) 10.47 12.60 15.80 11.87 10.45 11.48 10.28

Cash production costs ($ per tonne) 71.45 78.10 82.84 80.60 71.85 75.80 69.47

Cash costs per ounce of silver ($) (2.80) (6.25) (3.41) (4.53) (4.27) (4.27) (3.79)

All‐in sustaining costs per ounce of

silver ($) 1.52 (0.28) 1.39 2.13 1.08 0.75 2.30

Six Months ended September 30,

(Q2 Fiscal 2018 – 29,834 metres or $0.6 million) and 5,376 metres or $1.7 million worth of preparation

tunnelling (Q2 Fiscal 2018 – 6,390 metres or $1.9 million) were completed and expensed as mining

preparation costs at the Ying Mining District. In addition, approximately 18,634 metres or $6.0 million

worth of horizontal tunnels, raises, ramps and declines (Q2 Fiscal 2018 – 16,958 metres or $5.2 million)

were completed and capitalized.

i) Six months ended September 30, 2018 vs. Six months ended September 30, 2017

For the six months ended September 30, 2018, a total of 337,393 tonnes of ore were mined at the Ying

Mining District, an increase of 1% or 3,692 tonnes compared to 333,701 tonnes mined in the same prior

year period. Ore milled was 328,129 tonnes, down 3% or 10,775 tonnes compared to 338,904 tonnes in

the same prior year period. Average head grades of ore processed were 315 g/t for silver, 4.6% for lead,

and 1.0% for zinc compared to 299 g/t for silver, 4.4% for lead, and 0.8% for zinc, respectively, in the same

prior year period.

During the same time periods, the Ying Mining District sold approximately 3.1 million ounces of silver, 1,700

ounces of gold, 30.7 million pounds of lead, and 3.8 million pounds of zinc, compared to 2.8 million ounces of

silver, 1,700 ounces of gold, 29.0 million pounds of lead, and 3.0 million pounds of zinc in prior year period.

For the six months ended September 30, 2018, the cash mining costs and cash milling costs at the Ying Mining

District were $62.15 per tonne and $9.37 per tonne, an increase of 8% and 13%, respectively, compared to

$57.32 and $8.29 in the same prior year period. The cash production costs were $75.80 per tonne, slightly

higher than the annual guidance of $75.40.

Cash cost per ounce of silver and all in sustaining costs per ounce of silver, net of by‐product credits, at

the Ying Mining District, for the six months ended September 30, 2018, were negative $4.27 and $0.75

respectively, compared to negative $3.79 and $2.30 in the same prior year period.

For the six months ended September 30, 2018, approximately 49,521 metres or $1.1 million worth of

underground diamond drilling (same prior year period – 60,898 metres or $1.3 million) and 10,917 metres

or $3.0 million worth of preparation tunnelling (same prior year period – 11,727 metres or $3.3 million)

were completed and expensed as mining preparation costs at the Ying Mining District. In addition,

approximately 35,562 metres or $12.5 million worth of horizontal tunnels, raises, and declines (same prior

year period – 35,848 metres or $10.2 million) were completed and capitalized.

2. GC Mine, Guangdong Province, China

i) Q2 Fiscal 2019 vs. Q2 Fiscal 2018

In Q2 Fiscal 2019, the total ore mined at the GC Mine was 67,757 tonnes, an increase of 3% or 1,945

tonnes, compared to 65,812 tonnes mined in Q2 Fiscal 2018, while ore milled was 67,528 tonnes, an

increase of 6% or 3,880 tonnes compared to 63,648 tonnes in Q2 Fiscal 2018. Average head grades of ore

processed at the GC Mine were 78 g/t for silver, 1.4% for lead, and 2.8% for zinc compared to 102 g/t for

Operational results ‐ GC Mine Q2 2019 Q1 2019 Q4 2018 Q3 2018 Q2 2018

September 30, 2018 June 30, 2018 Ma rch 31, 2018 December 31, 2017 Se ptember 30, 2017 2018 2017

Ore Mined (tonne) 67,757 79,967 29,442 85,665 65,812 147,724 130,677

Ore Milled (tonne) 67,528 81,811 26,252 88,494 63,648 149,339 129,592

Head Grades

Silver (gram/tonne) 78 87 96 97 102 83 100

Lead (%) 1.4 1.3 1.3 1.4 1.4 1.3 1.5

Zinc (%) 2.8 2.9 2.9 2.8 2.8 2.8 2.7

Recovery Rates

Silver (%) 76.7 75.3 76.3 73.6 74.4 75.9 77.8

Lead (%) 91.2 87.1 87.5 83.9 82.8 89.1 86.0

Zinc (%) 83.3 84.8 85.7 81.3 81.6 84.1 81.2

Metal Sales

Silver (in thousands of ounce) 136 150 63 196 155 286 344

Lead (in thousands of pound) 2,063 1,583 688 2,263 1,656 3,646 3,803

Zinc (in thousands of pound) 3,240 4,244 1,479 4,399 3,311 7,484 7,555

Cash mining cost ($ per tonne) 41.25 36.78 45.92 35.48 34.60 38.83 36.88

Total mining cost ($ per tonne) 49.29 44.62 57.47 43.10 42.62 46.76 44.78

Cash milling cost ($ per tonne) 11.45 14.46 25.07 14.09 14.63 13.10 14.95

Total milling cost ($ per tonne) 14.47 17.14 33.41 16.45 17.90 15.93 18.14

Cash production cost ($ per tonne) 52.70 51.24 70.99 49.57 49.23 51.93 51.83

Cash cost per ounce of silver ($) (10.81) (18.81) (13.95) (15.34) (13.56) (15.01) (10.39)

All‐in sustaining cost per ounce of silver ($) (2.03) (11.36) (4.57) (4.52) (3.77) (6.92) (3.06)

Six Months Ended September 30

silver, 1.4% for lead, and 2.8% for zinc in the prior year quarter.

In Q2 Fiscal 2019, the GC Mine sold 136 thousand ounces of silver, 2.1 million pounds of lead, and 3.2

million pounds of zinc, compared to 155 thousand ounces of silver, 1.7 million pounds of lead, and 3.3

million pounds of zinc sold in the prior year quarter. The decrease in metals sold at the GC Mine was

mainly due to the increase in ending concentrate inventories. As at September 30, 2018, inventories of

silver‐lead concentrates were 280 tonnes and zinc concentrates were 368, compared to inventories of 20

tonnes of silver‐lead concentrate and 20 tonnes of zinc concentrate as at March 31, 2018.

Total and cash mining costs per tonne at the GC Mine in Q2 Fiscal 2019 were $49.29 and $41.25 per tonne,

compared to $42.62 and $34.60 per tonne in Q2 Fiscal 2018. The increase in cash mining costs was mainly

due to a $0.3 million increase in mining preparation costs resulting from more underground drilling and

tunnelling expensed in the current quarter. Total and cash milling costs per tonne at the GC Mine in Q2

Fiscal 2019 were $14.47 and $11.45, a decrease of 19% and 22%, respectively, compared to $17.90 and

$14.63, respectively, in Q2 Fiscal 2018.

Correspondingly, the total production costs and cash production costs per tonne of ore processed in Q2

Fiscal 2019 at the GC Mine were $63.76 and $52.70, an increase of 5% and 7%, respectively, compared to

$60.52 and $49.23 in the prior year quarter, and cash production costs per tonne is 8% lower than the

annual guidance of $57.20.

Cash costs per ounce of silver, net of by‐product credits, at the GC Mine, was negative $10.81 compared

to negative $13.56 in the prior year quarter. The increase was mainly due to a $0.3 million or 11%

increase cash production costs expensed into cost of sales and a $0.3 million or 5% decrease in by‐product

credits mainly resulting from an 11% and 17% decrease in net realized lead and zinc selling prices at the

GC Mine.

All in sustaining costs per ounce of silver, net of by‐product credits, in Q2 Fiscal 2019 at the GC Mine was

negative $2.03 compared to negative $3.77 in the prior year quarter, and the increase was mainly due to

the higher cash costs per ounce of silver, net of by‐product credits as discussed above.

In Q2 Fiscal 2019, approximately 7,355 metres or $0.3 million worth of underground diamond drilling (Q2

Fiscal 2018 – 5,511 metres or $0.2 million) and 5,243 metres or $1.4 million worth of tunnelling (Q2 Fiscal

2018 – 3,940 metres or $1.1 million) were completed and expensed as mining preparation costs at the GC

Mine. In addition, approximately 241 metres or $0.2 million of horizontal tunnels raises and declines (Q2

Fiscal 2018 – 105 metres or $0.1 million) were completed and capitalized.

ii) Six months ended September 30, 2018 vs. Six months ended September 30, 2017

For the six months ended September 30, 2018, a total of 147,724 tonnes of ore were mined and 149,339

tonnes were milled at the GC Mine, compared to 130,677 tonnes mined and 129,592 tonnes milled in the

same prior year period. Average head grades of ore milled were 83 g/t for silver, 1.3% for lead, and 2.8%

for zinc, compared to 100 g/t for silver, 1.5% for lead, and 2.7% for zinc, respectively, in the same prior

year period.

During the same time periods, the GC Mine sold approximately 286 thousand ounces of silver, 3.6 million

pounds of lead, and 7.5 million pounds of zinc, compared to 344 thousand ounces of silver, 3.8 million

pounds of lead, and 7.6 million pounds of zinc in the same prior year period.

For the six months ended September 30, 2018, the cash mining costs at the GC Mine was $38.83 per

tonne, an increase of 5% compared to $36.88 per tonne in the same prior year period. The increase in the

cash mining costs was mainly due to a $0.7 million increase in mining preparation as more underground

drilling and tunnelling was expensed in the current period. The cash milling costs was $13.10 per tonne, a

decrease of 12% compared to $14.95 in the same prior year period. Correspondingly, the total

production costs and cash production costs per tonne at the GC Mine were $62.69 and $51.93,

comparable to $62.92 and $51.83 in the prior year period, but the cash production costs per tonne is 9%

lower than the annual guidance of $57.20.

Cash costs per ounce of silver and all in sustaining costs per ounce of silver, net of by‐product credits, at

the GC Mine, for the six months ended September 30, 2018, were negative $15.01 and negative $6.92

respectively, compared to negative $10.39 and negative $3.06 in the same prior year period.

For the six months ended September 30, 2018, approximately 14,774 metres or $0.7 million worth of

underground diamond drilling (same prior year period – 10,483 metres or $0.5 million) and 10,484 metres

or $3.0 million of tunnelling (same prior year period – 9,232 metres or $2.4 million) were completed and

expensed as mining preparation costs at the GC Mine. In addition, approximately 779 metres or $0.7

million of horizontal tunnels, raise, and declines (same prior year period – 263 metres or $0.2 million)

were completed and capitalized.

Mr. Guoliang Ma, P.Geo., Manager of Exploration and Resources of the Company, is the Qualified Person

for Silvercorp under NI 43‐101 and has reviewed and given consent to the technical information contained

in this news release.

This earnings release should be read in conjunction with the Company's Management Discussion &

Analysis, Financial Statements and Notes to Financial Statements for the corresponding period, which have

been posted on SEDAR under the Company’s profile at www.sedar.com and are also available on the

Company's website at www.silvercorp.ca. All figures are in United States dollars unless otherwise stated.

About Silvercorp

Silvercorp is a low‐cost silver‐producing Canadian mining company with multiple mines in China. The

Company's vision is to deliver shareholder value by focusing on the acquisition of underdeveloped

projects with resource potential and the ability to grow organically. For more information, please visit our

website at www.silvercorp.ca.

For further information

Silvercorp Metals Inc.

Lon Shaver

Vice President

Phone: (604) 669‐9397

Toll Free 1(888) 224‐1881

Email: [email protected]

Website: www.silvercorp.ca

CAUTIONARY DISCLAIMER ‐ FORWARD‐LOOKING STATEMENTS

Certain of the statements and information in this news release constitute “forward‐looking statements” within the

meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward‐looking information”

within the meaning of applicable Canadian provincial securities laws (collectively, “forward‐looking statements”). Any

statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans,

projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases

such as “expects”, “is expected”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”,

“strategies”, “targets”, “goals”, “forecasts”, “objectives”, “budgets”, “schedules”, “potential” or variations thereof or

stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be

achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may

be forward‐looking statements. Forward‐looking statements relate to, among other things: the price of silver and

other metals; the accuracy of mineral resource and mineral reserve estimates at the Company’s material properties;

the sufficiency of the Company’s capital to finance the Company’s operations; estimates of the Company’s revenues

and capital expenditures; estimated production from the Company’s mines in the Ying Mining District; timing of

receipt of permits and regulatory approvals; availability of funds from production to finance the Company’s

operations; and access to and availability of funding for future construction, use of proceeds from any financing and

development of the Company’s properties.

Forward‐looking statements are subject to a variety of known and unknown risks, uncertainties and other factors that

could cause actual events or results to differ from those reflected in the forward‐looking statements, including,

without limitation, risks relating to: fluctuating commodity prices; calculation of resources, reserves and

mineralization and precious and base metal recovery; interpretations and assumptions of mineral resource and

mineral reserve estimates; exploration and development programs; feasibility and engineering reports; permits and

licences; title to properties; property interests; joint venture partners; acquisition of commercially mineable mineral

rights; financing; recent market events and conditions; economic factors affecting the Company; timing, estimated

amount, capital and operating expenditures and economic returns of future production; integration of future

acquisitions into the Company’s existing operations; competition; operations and political conditions; regulatory

environment in China and Canada; environmental risks; foreign exchange rate fluctuations; insurance; risks and

hazards of mining operations; key personnel; conflicts of interest; dependence on management; internal control over

financial reporting; and bringing actions and enforcing judgments under U.S. securities laws.

This list is not exhaustive of the factors that may affect any of the Company’s forward‐looking statements. Forward‐

looking statements are statements about the future and are inherently uncertain, and actual achievements of the

Company or other future events or conditions may differ materially from those reflected in the forward‐looking

statements due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in

the Company’s Annual Information Form for the year ended March 31, 2018 under the heading “Risk Factors”.

Although the Company has attempted to identify important factors that could cause actual results to differ materially,

there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly,

readers should not place undue reliance on forward‐looking statements.

The Company’s forward‐looking statements are based on the assumptions, beliefs, expectations and opinions of

management as of the date of this news release, and other than as required by applicable securities laws, the

Company does not assume any obligation to update forward‐looking statements if circumstances or management’s

assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such

statements. For the reasons set forth above, investors should not place undue reliance on forward‐looking

statements.

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