USA.TO · 2022-08-12 12:00:00

Americas GOLD and Silver Corporation Reports Second Quarter 2022 Results

Financials

AMERICAS GOLD AND SILVER CORPORATION REPORTS SECOND QUARTER 2022 RESULTS

TORONTO, ONTARIO— August 12, 2022 —Americas Gold and Silver Corporation (TSX: USA) (NYSE

American: USAS) (“Americas” or the “Company”), a growing North American precious metals producer,

reports consolidated financial and operational results for the quarter ended June 30, 2022.

This earnings release should be read in conjunction with the Company’s Management’s Discussion and

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

been posted on the Americas Gold and Silver Corporation SEDAR profile at www.sedar.com, and on its

EDGAR profile at www.sec.gov, and which are also available on the Company’s website at www.americas‐

gold.com. All figures are in U.S. dollars unless otherwise noted.

Highlights

● Revenue of approximately $20.0 million and a net loss of $9.3 million for Q2‐2022, or an

attributable loss of $0.04 per share. Despite higher silver equivalent production in Q2‐2022

compared to Q1‐2022, revenue decreased by approximately $6.5 million as a result of lower silver

and lead prices, lower final settlements on concentrate sales, and higher treatment and refining

costs.

● Net cash generated from operating activities2 was approximately $7.0 million.

● The Company had a cash and cash equivalents balance of $8.8 million as of June 30, 2022,

compared to a balance of $2.9 million as of December 31, 2021.

● Total liabilities on the balance sheet were reduced in the quarter by $3.5 million and by $19.4

million since year end as the Company continues to improve its financial position.

● The Company previously reported Q2‐2022 consolidated attributable production of approximately

300,000 silver ounces and 1,343,000 silver equivalent1 ounces. Silver production was unchanged

quarter‐over‐quarter and increased 115% year‐over‐year. Silver equivalent production increased

by over 5% quarter‐over‐quarter and over 475% year‐over‐year.

● The Company’s attributable consolidated Q2‐2022 cash costs2 per silver ounce was negative $2.72

per ounce and consolidated Q2‐2022 all‐in sustaining costs2 per silver ounce was $5.37 per ounce.

Cash costs continued to benefit from higher by‐product credits than budgeted though increased

quarter‐over‐quarter mainly due to increased employee retention costs and slightly higher raw

materials and consumable costs.

● Year‐to‐date attributable silver production of approximately 600,000 ounces at cash costs and all‐

in sustaining costs of negative $6.13 per silver ounce and $1.34 per silver ounce, respectively.

Year‐to‐ date attributable silver equivalent production is approximately 2.62 million ounces.

● The Company's silver and silver equivalent production guidance remains unchanged at 1.4 – 1.8

million ounces and 4.8 – 5.2 million ounces, respectively for 2022. Further increases in silver

production to a range of 3.4 – 3.8 million ounces and silver equivalent production to 7.0 – 7.4

million ounces are projected for 2024, representing increases of approximately 425% and 380%,

respectively, compared with 2021 production.

“We are generally pleased with the progress made in the first half of 2022 where we focused on the Cosalá

Operations ramp‐up, the refurbishment and installation of the new hoist at the Galena Complex and

improving the overall financial position of the Company,” stated Americas Gold and Silver President & CEO

Darren Blasutti. “Further, we have stayed on track to meet our silver and silver equivalent production as

well as our cost guidance despite the many challenges in the first half of the year including the Cosalá

Operations start‐up, persistent Covid challenges, volatile metal prices, increasing inflationary costs and

delays throughout the supply chain. We are expecting an exciting second half of the year where silver

production at both mines will noticeably increase due to mining in the Upper Zone at the Cosalá Operations

and mining higher‐grade silver stopes at the Galena Complex.”

Cosalá Operations

The Cosalá Operations had a strong quarter in Q2‐2022. During another full quarter of production in Q2‐

2022, the Cosalá Operations produced approximately 128,000 ounces of silver, 9.9 million pounds of zinc

and 3.9 million pounds of lead. Cash costs per silver ounce and all‐in sustaining costs per silver ounce were

negative $35.97 and negative $25.89, respectively, as the Cosalá Operations continued to benefit from

strong by‐product credits. Cash costs increased versus Q1‐2022 due to higher wages and consumables

costs.

The Company expects silver production to increase in H2‐2022 with a growing contribution from higher‐

grade silver areas in the Upper Zone of the San Rafael mine. Silver production from the Cosalá Operations

for the year is expected to be towards the bottom end of the projected range of 0.7 to 0.9 million silver

ounces as the Company focused on mining the higher‐grade zinc Main Zone in H1‐2022 and delay mining

the higher‐grade silver Upper Zone. Zinc production from the Cosalá Operations is expected to be towards

the upper end of the projected range of 36 to 40 million pounds while lead production is also expected to

be towards the upper end of the projected range of 13 to 15 million pounds.

Galena Complex

Attributable production from the Galena Complex was approximately 171,000 ounces of silver and 2.5

million pounds of lead in Q2‐2022. Silver production is expected to increase in H2‐2022 from a combination

of higher ore tonnage and higher average silver grade. The Company aims to commission the Galena Hoist

project in Q4‐2022 which will increase hoisting capacity at the operation once complete. Cash costs per

silver ounce and all‐in sustaining costs (excluding the Galena Hoist project) per silver were $22.09 and

$28.67, respectively. Cash costs per silver ounce and all‐in sustaining costs per silver ounce at the Galena

Complex are anticipated to improve given that most of the operating costs are fixed and are expected to

decrease on a per silver ounce basis assuming expected higher silver and lead production beyond 2022

following completion of the Galena Hoist project.

The outlook for expected attributable metal production from the Galena Complex in fiscal 2022 remains

unchanged and is estimated to be 0.7 to 0.9 million silver ounces and 9 to 11 million pounds of lead.

About Americas Gold and Silver Corporation

Americas Gold and Silver Corporation is a high‐growth precious metals mining company with multiple

assets in North America. The Company owns and operates the Relief Canyon mine in Nevada, USA, the

Cosalá Operations in Sinaloa, Mexico and manages the 60%‐owned Galena Complex in Idaho, USA. The

Company also owns the San Felipe development project in Sonora, Mexico. For further information, please

see SEDAR or www.americas‐gold.com.

For more information:

Stefan Axell Darren Blasutti

VP, Corporate Development & Communications President and CEO

Americas Gold and Silver Corporation Americas Gold and Silver Corporation

416‐874‐1708 416‐848‐9503

Technical Information and Qualified Persons

The scientific and technical information relating to the operation of the Company’s material operating

mining properties contained herein has been reviewed and approved by Daren Dell, P.Eng., Chief Operating

Officer of the Company. The Company’s current Annual Information Form and the NI 43‐101 Technical

Reports for its other material mineral properties, all of which are available on SEDAR at www.sedar.com,

and EDGAR at www.sec.gov contain further details regarding mineral reserve and mineral resource

estimates, classification and reporting parameters, key assumptions and associated risks for each of the

Company’s material mineral properties, including a breakdown by category.

All mining terms used herein have the meanings set forth in National Instrument 43‐101 – Standards of

Disclosure for Mineral Projects (“NI 43‐101”), as required by Canadian securities regulatory authorities.

These standards differ from the requirements of the SEC that are applicable to domestic United States

reporting companies. Any mineral reserves and mineral resources reported by the Company in accordance

with NI 43‐101 may not qualify as such under SEC standards. Accordingly, information contained in this

news release may not be comparable to similar information made public by companies subject to the SEC’s

reporting and disclosure requirements.

Cautionary Statement on Forward‐Looking Information:

This news release contains “forward‐looking information” within the meaning of applicable securities laws.

Forward‐looking information includes, but is not limited to, Americas Gold and Silver’s expectations,

intentions, plans, assumptions and beliefs with respect to, among other things, estimated and targeted

production rates and results for gold, silver and other metals, the expected prices of gold, silver and other

metals, as well as the related costs, expenses and capital expenditures; production from the Galena

Complex, including the expected production levels and potential additional mineral resources thereat; the

expected timing and completion of the Galena Hoist project and the expected operational and production

results therefrom; mining and processing operations at the Cosalá Operations continuing, including

expected production levels and the continuity of legal access for employees and contractors; and the goal

and results of test work intended to address metallurgical challenges at Relief Canyon. Guidance and

outlook contained in this press release was prepared based on current mine plan assumptions with respect

to production, development, costs and capital expenditures, the metal price assumptions disclosed herein,

and assumes no adverse impacts to operations from the COVID 19 pandemic and no further adverse

impacts to the Cosalá Operations from blockades and is subject to the risks and uncertainties outlined

below. The ability to maintain cash flow positive production at the Cosalá Operations through meeting

production targets and at the Galena Complex through implementing the Galena Recapitalization Plan,

allowing the Company to generate sufficient operating cash flows while facing market fluctuations in

commodity prices and inflationary pressures, are significant judgments in the Q2‐2022 condensed interim

consolidated financial statements with respect to the Company’s liquidity. Should the Company experience

negative operating cash flows in future periods, the Company may need to raise additional funds through

the issuance of equity or debt securities. Often, but not always, forward‐looking information can be

identified by forward‐looking words such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”,

“potential’, “estimate”, “may”, “assume” and “will” or similar words suggesting future outcomes, or other

expectations, beliefs, plans, objectives, assumptions, intentions, or statements about future events or

performance. Forward‐looking information is based on the opinions and estimates of Americas Gold and

Silver as of the date such information is provided and is subject to known and unknown risks, uncertainties,

and other factors that may cause the actual results, level of activity, performance, or achievements of

Americas Gold and Silver to be materially different from those expressed or implied by such forward‐

looking information. With respect to the business of Americas Gold and Silver, these risks and uncertainties

include risks relating to widespread epidemics or pandemic outbreak including the COVID‐19 pandemic,

including the emergence of new strains and/or the resurgence of COVID‐19, actions that have been and

may be taken by governmental authorities to contain the COVID‐19 pandemic or to treat its impact and/or

the availability, effectiveness and use of treatments and vaccines (including the effectiveness of boosters);

the impact of COVID‐19 on our workforce, suppliers and other essential resources and what effect those

impacts, if they occur, would have on our business, including our ability to access goods and supplies, the

ability to transport our products and impacts on employee productivity, the risks in connection with the

operations, cash flow and results of the Company relating to the unknown duration and impact of the

COVID‐19 pandemic; interpretations or reinterpretations of geologic information; unfavorable exploration

results; inability to obtain permits required for future exploration, development or production; general

economic conditions and conditions affecting the industries in which the Company operates; the

uncertainty of regulatory requirements and approvals; fluctuating mineral and commodity prices; the

ability to obtain necessary future financing on acceptable terms or at all; the ability to operate the

Company’s projects; and risks associated with the mining industry such as economic factors (including

future commodity prices, currency fluctuations and energy prices), ground conditions, illegal blockades and

other factors limiting mine access or regular operations without interruption, failure of plant, equipment,

processes and transportation services to operate as anticipated, environmental risks, government

regulation, actual results of current exploration and production activities, possible variations in ore grade

or recovery rates, permitting timelines, capital and construction expenditures, reclamation activities, labor

relations or disruptions, social and political developments, risks associated with generally elevated inflation

and inflationary pressures, risks related to changing global economic conditions, and market volatility, risks

relating to geopolitical instability, political unrest, war, and other global conflicts may result in adverse

effects on macroeconomic conditions including volatility in financial markets, adverse changes in trade

policies, inflation, supply chain disruptions and other risks of the mining industry. The potential effects of

the COVID‐19 pandemic on our business and operations are unknown at this time, including the Company’s

ability to manage challenges and restrictions arising from COVID‐19 in the communities in which the

Company operates and our ability to continue to safely operate and to safely return our business to normal

operations. The impact of COVID‐19 on the Company is dependent on a number of factors outside of its

control and knowledge, including the effectiveness of the measures taken by public health and

governmental authorities to combat the spread of the disease, global economic uncertainties and outlook

due to the disease, and the evolving restrictions relating to mining activities and to travel in certain

jurisdictions in which it operates. Although the Company has attempted to identify important factors that

could cause actual results to differ materially from those contained in forward‐looking information, there

may be other factors that cause results not to be as anticipated, estimated, or intended. Readers are

cautioned not to place undue reliance on such information. Additional information regarding the factors

that may cause actual results to differ materially from this forward‐looking information is available in

Americas Gold and Silver’s filings with the Canadian Securities Administrators on SEDAR and with the SEC.

Americas Gold and Silver does not undertake any obligation to update publicly or otherwise revise any

forward‐looking information whether as a result of new information, future events or other such factors

which affect this information, except as required by law. Americas Gold and Silver does not give any

assurance (1) that Americas Gold and Silver will achieve its expectations, or (2) concerning the result or

timing thereof. All subsequent written and oral forward‐looking information concerning Americas Gold

and Silver are expressly qualified in their entirety by the cautionary statements above.

1 Silver equivalent ounces for the 2022 guidance, and 2023 and 2004 outlook references were calculated

based on $22.00/oz silver, $0.95/lbs lead and $1.30/lbs zinc throughout this press release. Silver equivalent

ounces for Q2‐2022, Q1‐2022 and prior periods in fiscal 2021 were calculated based on all metals

production at average realized silver, zinc, and lead prices during each respective period throughout this

press release.

2 This metric is a non‐GAAP financial measure or ratio. The Company uses the financial measures “Cash

Costs”, “Cash Costs/Ag Oz Produced”, “All‐In Sustaining Costs”, and “All‐In Sustaining Costs/Ag Oz

Produced” in accordance with measures widely reported in the silver mining industry as a benchmark for

performance measurement and because it understands that, in addition to conventional measures

prepared in accordance with IFRS, certain investors and analysts use this information to evaluate the

Company’s underlying cash costs and total costs of operations. Cash costs are determined on a mine‐by‐

mine basis and include mine site operating costs such as mining, processing, administration, production

taxes and royalties which are not based on sales or taxable income calculations, while all‐in sustaining costs

is the cash costs plus all development, capital expenditures, and exploration spending.

Reconciliation of Consolidated Cash Costs/Ag Oz Produced1

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cost of sales ('000) $16,552 ‐ $33,106 ‐

Less non‐controlling interests portion ('000) (3,440) ‐ (6,918) ‐

Attributable cost of sales ('000) 3,112 ‐ 26,188 ‐

Non‐cash costs ('000) 71 ‐ (1,725) ‐

Direct mining costs ('000) $13,183 ‐ $24,463 ‐

Smelting, refining and royalty expenses ('000) 6,447 ‐ 12,074 ‐

Less by‐product credits ('000) (20,440) ‐ (40,215) ‐

Cash costs ('000) $(810) ‐ $(3,678) ‐

Divided by silver produced (oz) 299,228 ‐ 599,544 ‐

Cash costs/Ag oz produced ($/oz) $(2.72) ‐ $(6.13) ‐

Reconciliation of Cosalá Operations Cash Costs/Ag Oz Produced

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cost of sales ('000) $7,953 ‐ $15,812 ‐

Non‐cash costs ('000) 20 ‐ (1,421) ‐

Direct mining costs ('000) $7,973 ‐ $14,391 ‐

Smelting, refining and royalty expenses ('000) 5,485 ‐ 10,184 ‐

Less by‐product credits ('000) (18,055) ‐ (35,366) ‐

Cash costs ('000) $(4,597) ‐ $(10,791) ‐

Divided by silver produced (oz) 127,803 ‐ 254,570 ‐

Cash costs/Ag oz produced ($/oz) $ (35.97) ‐ $(42.39) ‐

Reconciliation of Galena Complex Cash Costs/Ag Oz Produced

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cost of sales ('000) $8,599 ‐ $17,294 ‐

Non‐cash costs ('000) 85 ‐ (507) ‐

Direct mining costs ('000) $8,684 ‐ $16,787 ‐

Smelting, refining and royalty expenses ('000) 1,603 ‐ 3,150 ‐

Less by‐product credits ('000) (3,975) ‐ (8,081) ‐

Cash costs ('000) $6,312 ‐ $11,856 ‐

Divided by silver produced (oz) 285,707 ‐ 574,956 ‐

Cash costs/Ag oz produced ($/oz) $22.09 ‐ $20.62 ‐

Reconciliation of Consolidated All‐In Sustaining Costs/Ag Oz Produced 1

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cash costs ('000) $(809) ‐ $(3,677) ‐

Capital expenditures ('000) 2,138 ‐ 3,761 ‐

Exploration costs ('000) 278 ‐ 722 ‐

All‐in sustaining costs ('000) $1,607 ‐ $806 ‐

Divided by silver produced (oz) 299,228 ‐ 599,544 ‐

All‐in sustaining costs/Ag oz produced ($/oz) $5.37 ‐ $1.34 ‐

Reconciliation of Cosalá Operations All‐In Sustaining Costs/Ag Oz Produced

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cash costs ('000) $(4,597) ‐ $(10,791) ‐

Capital expenditures ('000) 1,022 ‐ 1,393 ‐

Exploration costs ('000) 266 ‐ 700 ‐

All‐in sustaining costs ('000) $(3,309) ‐ $(8,698) ‐

Divided by silver produced (oz) 127,803 ‐ 254,570 ‐

All‐in sustaining costs/Ag oz produced ($/oz) $(25.89) ‐ $(34.17) ‐

Reconciliation of Galena Complex All‐In Sustaining Costs/Ag Oz Produced

Q2‐2022 Q2‐20212 YTD‐2022 YTD‐20212

Cash costs ('000) $6,312 ‐ $11,856 ‐

Capital expenditures ('000) 1,860 ‐ 3,946 ‐

Exploration costs ('000) 20 ‐ 37 ‐

All‐in sustaining costs ('000) $8,192 ‐ $15,839 ‐

Galena Complex Recapitalization Plan costs ('000) 2,308 ‐ 3,855 ‐

All‐in sustaining costs with Galena Recapitalization Plan ('000) $10,500 ‐ $19,694 ‐

Divided by silver produced (oz) 285,707 ‐ 574,956 ‐

All‐in sustaining costs/Ag oz produced ($/oz) $28.67 ‐ $27.55 ‐

All‐in sustaining costs with Galena Recapitalization Plan/Ag oz produced ($/oz) $36.75 ‐ $34.25 ‐

1 Throughout this press release, consolidated production results and consolidated operating metrics are based on the

attributable ownership percentage of each operating segment (100% Cosalá Operations and 60% Galena Complex).

2 Production results are nil for the Cosalá Operations from Q2‐2020 to Q3‐2021 due to it being placed under care and

maintenance effective February 2020 as a result of the illegal blockade and exclude the Galena Complex due to suspension of

certain operating metrics during the Galena Recapitalization Plan implementation.

The Company uses the financial measure “net loss per share”, “net cash generated from operating

activities”, and “working capital” because it understands that, in addition to conventional measures

prepared in accordance with IFRS, certain investors and analysts use this information to evaluate the

Company’s liquidity, operational efficiency, and short‐term financial health.

Net loss per share is consolidated net loss divided by the weighted average number of common shares

outstanding during the period.

Reconciliation of Net Loss per Share

Q2‐2022 Q2‐2021 YTD‐2022 YTD‐2021

Consolidated net loss ('000) $(9,278) $(17,782) $(9,574) $(109,582)

Divided by weighted average number of common shares outstanding 180,795,755 133,928,463 176,871,371 130,618,095

Net loss per share $(0.05) $(0.13) $(0.05) $(0.84)

Net cash generated from operating activities is a financial measure disclosed in the Company’s statements

of cash flows determined as cash generated from operating activities, after changes in non‐cash working

capital items.

Reconciliation of Net Cash Generated from Operating Activities

Q2‐2022 Q2‐2021 YTD‐2022 YTD‐2021

Cash generated from (used in) operating activities ('000) $(2,312) $(5,604) $4,137 $(12,796)

Changes in non‐cash working capital items ('000) 9,284 (9,987) 1,012 (19,108)

Net cash generated from (used in) operating activities ('000) $6,972 $(15,591) $5,149 $(31,904)

Working capital is the excess of current assets over current liabilities.

Reconciliation of Working Capital

Q2‐2022 Q2‐2021

Current Assets ('000) $29,091 $29,370

Less current liabilities ('000) (38,061) (39,034)

Working capital ('000) $(8,970) $(9,664)

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