Silvercorp Reports Adjusted Net Income of $11.7 Million, $0.07 per Share, and Cash Flow from Operations of $28.8 Million for Q2 Fiscal 2024
NEWS RELEASE
Trading Symbol: TSX: SVM
NYSE AMERICAN: SVM
Silvercorp Reports Adjusted Net Income of $11.7 Million, $0.07 per Share,
and Cash Flow from Operations of $28.8 Million for Q2 Fiscal 2024
VANCOUVER, British Columbia – November 9, 2023 – Silvercorp Metals Inc. (“Silvercorp” or the “Company”)
(TSX/NYSE American: SVM) report s its financial and operating results for the three months ended September
30, 2023 (“Q2 Fiscal 2024”). All amounts are expressed in US dollars, and figures may not add due to rounding.
HIGHLIGHTS FOR Q2 FISCAL 2024
• Mined 273,465 tonnes of ore, milled 261,107 tonnes of ore, and produced approximately 2,458 ounces of
gold, 1.6 million ounces of silver, or approximately 1.8 million ounces of silver equivalent, plus 16.1 million
pounds of lead and 4.6 million pounds of zinc;
• Sold approximately 2,515 ounces of gold, 1.6 million ounces of silver, 15.2 million pounds of lead, and 4.6
million pounds of zinc, for revenue of $54.0 million;
• Reported net income attributable to equity shareholders of $11.1 million, or $0.06 per share;
• Realized adjusted earnings attributable to equity shareholders of $11.7 million, or $0.07 per share;
• Generated cash flow from operating activities of $28.8 million;
• Cash costs per ounce of silver, net of by-product credits, of negative $1.00;
• All-in sustaining costs per ounce of silver, net of by-product credits, of $11.50;
• Spent and capitalized $2.0 million on exploration drilling, $10.6 million on underground development, and
$2.5 million on equipment and facilities, including $1.7 million on construction of the new tailings storage
facility;
• Invested an additional $5.0 million in New Pacific Metals Corp. (TSX: NUAG) (“NUAG”), an associate of the
Company;
• Entered into a binding agreement to acquire all fully paid ordinary shares of OreCorp Limited (ASX: ORR)
(“OreCorp”) and thereby its Nyanzaga gold project in Tanzania, and in conjunction therewith invested
$18.5 million (A$28.0 million) in OreCorp to finance continued development. The acquisition has been
approved by the Tanzanian government and is subject to final OreCorp shareholder approval expected in
early December 2023;
• Spent $0.6 million to buy back 196,554 common shares of the Company under its Normal Course Issuer
Bid; and
• Strong balance sheet with $189.1 million in cash and cash equivalents and short -term investments. The
Company holds a further equity investment portfolio in associates and other companies with a total market
value of $124.0 million as at September 30, 2023.
CONSOLIDATED FINANCIAL RESULTS
Net income attributable to equity shareholders of the Company in Q2 Fiscal 2024 was $11.1 million or $0.06
per share, compared to a net loss of $1.7 million or loss of $0.01 per share in the three months ended September
30, 2022 (“Q2 Fiscal 2023”).
Compared to Q2 Fiscal 2023, the Company’s consolidated financial results in the current quarter were mainly
impacted by i) increases of 38%, 27%, and 2%, respectively, in the realized selling prices for gold, silver, and lead,
and a decrease of 27% in the realized selling price for zinc; ii) an increases of 110% in gold sold and decreases of
12%, 12% and 23% respectively, in silver, lead and zinc sold ; iii) a dilution gain of $0.7 million ar ising from the
investment in NUAG; iv) a decrease of $1.0 million in the loss on the mark-to-market investments; v) a decrease
of $3.0 million in foreign exchange gain; and vi) no impairment charges while a total of $20.2 million impairment
charges against the mineral rights and properties were recorded in Q2 Fiscal 2023
Revenue in Q2 Fiscal 2024 was $54.0 million, up 4% compared to $51.7 million in Q2 Fiscal 2023. The increase
is mainly due to the increase in net realized selling prices for silver, gold and lead offset by the decreases in
silver, lead and zinc sold.
Income from mine operations in Q2 Fiscal 2024 was $20.9 million, up 46% compared to $14.4 million in Q2
Fiscal 2023. Income from mine operations at the Ying Mining District was $21.8 million, compared to $12.9
million in Q2 Fiscal 2023. Loss from mine operations at the GC Mine was $0.7 million, compared to income of
$1.5 million in Q2 Fiscal 2023.
Cash flow provided by operating activities in Q2 Fiscal 2024 was $ 28.8 million, up $14.7 million, compared to
$14.1 million in Q2 Fiscal 2023.
The Company ended the quarter with $ 189.1 million in cash, cash equivalents and short -term investments,
down 6% compared to $200.6 million as at June 30, 2023, which is due to total investments of $23.5 million in
NUAG and OreCorp and payment of $15.4 million on capital expenditures, offset by a $28.8 million in cash
generated from operations.
Working capital as at September 30, 2023 was $154.3 million, down 9% compared to $169.5 million as at June
30, 2023.
Three months ended September 30, Six months ended September 30, Three months ended June 30,
2023 2022 Changes 2023 2022 Changes
Financial Results
Revenue (in thousands of $) 53,992$ 51,739$ 4% 113,998$ 115,331$ -1%
Mine operating earnings (in thousands of $) 20,943 14,361 46% 44,244 39,263 13%
Net income (loss) attributable to equity holders (in thousands of $) 11,050 (1,712) 745% 20,267 8,457 140%
Earnings (loss) per share - basic ($/share) 0.06 (0.01) 700% 0.11 0.05 120%
Adjusted earnings attributable to equity holders (in thousands of $) 11,677 6,752 73% 24,046 20,281 19%
Adjusted earning per share - basic ($/share) 0.07 0.04 73% 0.14 0.11 19%
Net cash generated from operating activities (in thousands of $) 28,844 14,064 105% 57,725 54,240 6%
Capitalized expenditures (in thousands of $) 15,058 17,354 -13% 30,974 32,882 -6%
Metals sold
Gold (ounces) 2,515 1,200 110% 4,010 2,300 74%
Silver (in thousands of ounces) 1,578 1,789 -12% 3,393 3,704 -8%
Lead (in thousands of pounds) 15,175 17,268 -12% 32,505 36,393 -11%
Zinc (in thousands of pounds) 4,578 5,940 -23% 11,498 12,868 -11%
Average Selling Price, Net of Value Added Tax and Smelter Charges
Gold ($/ounce) 1,815 1,316 38% 1,766 1,449 22%
Silver ($/ounce) 19.74 15.50 27% 19.54 16.78 16%
Lead ($/pound) 0.87 0.85 2% 0.85 0.88 -3%
Zinc ($/pound) 0.79 1.08 -27% 0.81 1.16 -30%
Financial Position as at September 30, 2023 June 30, 2023 September 30, 2023 March 31, 2023
Cash and cash equivalents and short-term investments (in thousands of $) 189,091 200,600 -6% 189,091 203,323 -7%
Working capital (in thousands of $) 154,330 169,531 -9% 154,330 177,808 -13%
CONSOLIDATED OPERATIONAL RESULTS
In Q2 Fiscal 2024, the Company mined 273,465 tonnes of ore, down 6% compared to 290,981 tonnes in Q2 Fiscal
2023. Ore milled in Q2 Fiscal 2024 was 261,107 tonnes, down 10% compared to 291,643 tonnes in Q2 Fiscal
2023, due to lower production at the GC Mine caused by a production disruption of five week s. (refer to the
Company’s news release dated September 5, 2023).
In Q2 Fiscal 2024, the Company produced approximately 2,458 ounces of gold, 1.6 million ounces of silver, or
approximately 1.8 million ounces of silver equivalent, plus 16.1 million pounds of lead and 4.6 million pounds
of zinc, representing an increase of 105% in gold production, and decreases of 12%, 11% and 13%, respectively,
in silver, lead and zinc production over Q2 Fiscal 2023. The decrease s in silver, lead and zinc production were
mainly due to lower production achieved at the GC Mine and lower head s grades achieved due to mining
sequences and more gold ore mined and processed at the Ying Mining District.
In Q2 Fiscal 2024, the consolidated mining costs were $64.77 per tonne, down 8% compared to $70.60 per tonne
in Q2 Fiscal 2023. The consolidated milling costs were $13.10 per tonne, up 4% compared to $12.59 per tonne
in Q2 Fiscal 2023. Correspondingly, the consolidated production costs per tonne of ore processed were $80.53,
down 6% compared to $86.07 in Q2 Fiscal 2023. The decrease was attributed to less drilling expensed and
approximately 6% depreciation of the Chinese yuan against the US dollar.
The all -in sustaining production costs per tonne of ore processed in Q2 Fiscal 2024 were $149.94, up 18%
compared to $127.48 in Q2 Fiscal 2023. The increase is mainly due to increases of $5.4 million in sustaining
capital expenditures and $0.7 million in general administrative expenses and government fees and other taxes.
In Q2 Fiscal 2024, the consolidated cash costs per ounce of silver, net of by-product credits, were negative $1.00,
compared to $0.77 in the prior year quarter. The improvement was mainly due to the decrease in per tonne
production costs contributing to a decrease of $4.1 million in expensed production costs.
The consolidated all-in sustaining costs per ounce of silver, net of by-product credits, were $11.50 compared to
$8.25 in Q2 Fiscal 2023. The increase was mainly due to the increase in all -in sustaining production costs per
tonne.
Three months ended September 30, Six months ended September 30,
2023 2022 Changes 2023 2022 Changes
Ore Production (tonne)
Ore mined 273,465 290,981 -6% 576,685 591,085 -2%
Ore milled 261,107 291,643 -10% 556,202 589,819 -6%
Metal Production
Gold (ounces) 2,458 1,200 105% 4,010 2,300 74%
Silver (in thousands of ounces) 1,590 1,798 -12% 3,370 3,658 -8%
Silver equivalent (in thousands of ounces) 1,815 1,898 -4% 3,725 3,853 -3%
Lead (in thousands of pounds) 16,065 17,983 -11% 33,881 37,071 -9%
Zinc (in thousands of pounds) 4,601 5,986 -23% 11,422 12,912 -12%
Cash Costs
Production costs per tonne of ore processed ($) 80.53 86.07 -6% 79.53 84.50 -6%
All-in sustaining costs per tonne of ore processed ($) 149.94 127.48 18% 141.53 116.36 22%
Cash costs per ounce of silver, net of by-product credits ($) (1.00) 0.77 -230% (0.63) (0.44) -43%
All-in sustaining costs per ounce of silver, net of by-product credits ($) 11.50 8.25 39% 10.41 8.77 19%
EXPLORATION AND DEVELOPMENT
Total capital expenditures in Q 2 Fiscal 2024 were $15. 1 million, down 13% compared to $1 7.4 million in Q 2
Fiscal 2023. Capital expenditures incurred to construct the new tailing storage facility (“TSF”) in Q2 Fiscal 2024
were $1.7 million (Q2 Fiscal 2023 - $1.3 million). As of September 30, 2023, total expenditures incurred on the
construction of the TSF were approximately $8.9 million, and the Company remains on track to complete the
TSF in 2024.
In Q2 Fiscal 2024, on a consolidated basis, a total of 76,184 metres or $2.6 million worth of diamond drilling
were completed (Q2 Fiscal 2023 – 88,506 metres or $4.2 million), of which approximately 29,548 metres or $0.6
million worth of underground drilling were expensed as part of mining costs (Q2 Fiscal 2023 – 45,365 metres or
$1.3 million) and approximately 46,636 metres or $2.0 million worth of drilling were capitalized (Q2 Fiscal 2023
– 43,141 metres or $2.9 million). In addition, approximately 10,868 metres or $4.1 million worth of preparation
tunnelling were completed and expensed as part of mining costs (Q 2 Fiscal 2023 – 10,340 metres or $4.0
million), and approximately 24,727 metres or $10.6 million worth of tunnels, raises, ramps and declines were
completed and capitalized (Q2 Fiscal 2023 – 21,187 metres or $9.4 million).
INDIVIDUAL MINE OPERATING PERFORMANCE
The table below summarizes the operating results at the Ying Mining District for the past five quarters and for
the six months ended September 30, 2023 and 2022.
Equipment &
Mill and TSF
Mining Preparation
Tunnels Drilling
(Metres) ($ Thousand) (Metres) ($ Thousand) (Metres) ($ Thousand) ($ Thousand) ($ Thousand) (Metres) (Metres)
Q2 Fiscal 2024
Ying Mining District 2,703 1,943$ 20,147 8,042$ 40,854 1,481$ 2,266 13,732$ 9,460 22,968
GC Mine 248 195 1,629 428 5,782 420 193 1,236 1,408 6,580
Corporate and other - - - - - 76 14 90 - -
Consolidated 2,951 2,138$ 21,776 8,470$ 46,636 1,977$ 2,473$ 15,058$ 10,868 29,548
Q2 Fiscal 2023
Ying Mining District 1,744 1,439$ 16,122 6,934$ 31,642 1,374$ 4,558 14,305$ 8,912 33,446
GC Mine - - 3,321 985 5,974 173 536 1,694 1,428 11,919
Corporate and other - - - - 5,525 1,344 11 1,355 - -
Consolidated 1,744 1,439$ 19,443 7,919$ 43,141 2,891$ 5,105$ 17,354$ 10,340 45,365
Variances (%)
Ying Mining District 55% 35% 25% 16% 29% 8% -50% -4% 6% -31%
GC Mine 0% 0% -51% -57% -3% 143% -64% -27% -1% -45%
Corporate and other - - - - (1.00) -94% 27% -93% - -
Consolidated 69% 49% 12% 7% 8% -32% -52% -13% 5% -35%
Capitalized Development and Expenditures
Ramp Development
Exploration and
Development Tunnels Drilling Total
Expensed
Ying Mining District Q2 F2024 Q1 F2024 Q4 F2023 Q3 F2023 Q2 F2023 Six months ended September 30,
September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022 2023 2022
Ore Production (tonne)
Ore mined 220,636 213,748 132,205 206,854 215,927 434,384 429,965
Ore milled 212,868 208,809 130,910 213,830 216,262 421,677 428,317
Head grades
Silver (grams/tonne) 235 254 255 262 257 244 262
Lead (%) 3.5 3.6 3.6 4.0 3.7 3.5 3.8
Zinc (%) 0.7 0.7 0.6 0.7 0.7 0.7 0.7
Recovery rates
Silver (%) 95.0 95.1 95.2 95.7 95.5 95.0 95.6
Lead (%) 95.0 95.5 95.3 95.4 94.1 95.3 94.8
Zinc (%) 71.1 69.6 68.3 66.4 62.5 70.3 60.3
Cash Costs
Cash production cost per tonne of ore processed ($) 83.53 102.42 88.66 95.23 93.04 84.54 94.14
All-in sustaining cost per tonne of ore processed ($) 142.84 170.69 141.21 127.89 156.07 138.42 141.84
Cash cost per ounce of Silver, net of by-product credits ($) (1.37) 1.37 0.24 1.86 0.28 (0.52) 1.05
All-in sustaining cost per ounce of silver, net of by-product credits ($) 8.06 11.33 7.66 6.82 8.60 7.58 7.73
Metal Production
Gold ( ounces) 2,458 1,552 1,000 1,100 1,200 4,010 2,300
Silver (in thousands of ounces) 1,506 1,597 997 1,674 1,657 3,129 3,408
Lead (in thousands of pounds) 15,018 15,382 9,688 17,647 16,201 29,277 32,347
Zinc (in thousands of pounds) 2,197 2,113 1,164 2,082 1,976 4,295 3,917
The table below summarizes the operating results at the GC Mine for the past five quarters and for the six
months ended September 30, 2023 and 2022.
CONFERENCE CALL DETAILS
A conference call to discuss these results will be held tomorrow, Friday, November 110, at 9:00 am PDT (12:00
pm EDT). To participate in the conference call, please dial the numbers below.
Canada/USA TF: 888-664-6383
International/Local Toll: 416-764-8650
Conference ID: 06660065
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.silvercorp.ca.
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.silvercorp.ca.
For further information
Silvercorp Metals Inc.
Lon Shaver
President
Phone: (604) 669-9397
Toll Free 1(888) 224-1881
Email: [email protected]
Website: www.silvercorp.ca
ALTERNATIVE PERFORMANCE (NON-IFRS) MEASURES
This news release should be read in conjunction with the Company's Management Discussion & Analysis (“MD&A”), the
unaudited condensed interim consolidated financial statements and related notes contains therein for the three and six
GC Mine Q2 F2024 Q1 F2024 Q4 F2023 Q3 F2023 Q2 F2023 Six months ended September 30,
September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022 2023 2022
Ore Production (tonne)
Ore mined 52,829 89,472 49,643 89,196 75,054 142,301 161,120
Ore milled 48,239 86,286 48,483 89,612 75,381 134,525 161,502
Head grades
Silver (grams/tonne) 66 80 88 75 72 75 72
Lead (%) 1.1 1.4 1.3 1.4 1.2 1.3 1.3
Zinc (%) 2.5 2.7 2.5 2.8 2.7 2.7 2.8
Recovery rates
Silver (%) 82.7 82.7 78.9 83.0 81.0 82.7 82.3
Lead (%) 90.2 90.7 90.9 90.3 88.5 90.6 89.3
Zinc (%) 89.8 90.4 89.3 90.1 89.6 90.2 90.0
Cash Costs
Cash production cost per tonne of ore processed ($) 68.18 67.34 52.35 59.84 57.92 64.25 58.81
All-in sustaining cost per tonne of ore processed ($) 99.75 84.79 88.26 78.31 81.68 94.12 80.10
Cash cost per ounce of Silver, net of by-product credits ($) 5.64 (3.10) (13.72) (12.13) (22.42) (1.99) (17.55)
All-in sustaining cost per ounce of silver, net of by-product credits ($) 25.95 5.93 5.02 (0.73) (7.48) 14.49 (4.29)
Metal Production
Silver (in thousands of ounces) 84 183 109 179 141 264 296
Lead (in thousands of pounds) 1,047 2,434 1,250 2,412 1,782 3,228 4,046
Zinc (in thousands of pounds) 2,404 4,708 2,413 4,892 4,010 7,203 8,951
months ended September 30, 2023, which have been posted on SEDAR+ under the Company’s profile at www.sedarplus.ca
and on EDGAR at www.sec.gov, and are also available on the Company's website at www.silvercorp.ca under the Investor
section. This news release refers to various alternative performance (non -IFRS) measures, such as adjusted earnings and
adjusted earnings per share, cash costs and all-in sustaining costs per ounce of silver, net of by-product credits, production
costs and all -in sustaining production costs per tonne of ore processed , silver equivalent, and working capital. These
measures are widely used in the mining industry as a benchmark for performance, but do not have standardized meanings
under IFRS as an indicator of performance and m ay differ from methods used by other companies with similar description.
The detailed description and reconciliation of these alternative performance (non -IFRS) measures have been incorporated
by reference and can be found on page 31, section 11 – Alternative Performance (Non-IFRS) Measures in the MD&A for the
three and six months ended September 30, 2023 filled on SEDAR at www.sedarplus.ca and EDGAR at www.sec.gov and which
is incorporated by reference here in.
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 and US 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; th e 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 and the GC Mine; 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.
Actual results may vary from forward-looking statements. 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: global economic and social impact of COVID-19;
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 int o 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 under the heading “Risk Factors” and in the Company’s Annual Report on Form 40-F, and in the Company’s other filings
with Canadian and U.S. securities regulators. 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 obligatio n 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. Assumptions may prove
to be incorrect and actual results may dif fer materially from those anticipated. Consequently, guidance cannot be
guaranteed. For the reasons set forth above, investors should not place undue reliance on forward-looking statements.