May 11, 2023
SILVER X REPORTS STEADY PERFORMANCE DURING FIRST QUARTER OF COMMERCIAL PRODUCTION
Solid results amid improving efficiencies and throughput while ramp up of production continues at Nueva Recuperada
Vancouver, BC, May 11, 2023 – Silver X Mining Corp. (TSX-V: AGX) (OTCQB: AGXPF) (F: AGX) (“Silver X” or the “Company”) reports production results for the three months ended March 31, 2023, for the Company’s wholly- owned Nueva Recuperada project in central Peru.
First Quarter 2023 Production Highlights:
- Declared commercial production in January 2023 and returned to targeted throughput in January after a period of social disruption in Peru.
- Total production of 282,687 silver equivalent (“AgEq”) (2) ounces with an average head grade of 277 g/t AgEq.
- Ramp up continues with record throughput of 17,239 tonnes at 575 tonnes per day in March 2023.
- Processed 265% more AgEq ounces in the first quarter (“Q1”) of 2023 as compared with Q1 2022, equating to 358,727 AgEq ounces compared with 98,327 AgEq ounces, respectively.
“I am pleased to report positive momentum and strong operating performance in our first quarter of commercial production at Nueva Recuperada,” stated José M. García, President and CEO of Silver X. “Despite supply shortages in the fourth quarter of 2022 due to road blockages in Peru, we achieved record performance in March of 17,500 tonnes processed at a rate of 575 tonnes per day. Throughput continues to increase along with improved ore selectivity and stronger mine development translating into better head grades. These outcomes reflect Silver X’s dedication to efficiency and signal the potential for positive results in future quarters.”
First Quarter 2023 Production Results – Nueva Recuperada
NOTES:
- Nueva Recuperada completed in December 2022 the ramp up period of its operations and declared the start of the Commercial production in January 2023.
- AgEq ounces produced were calculated based on all metals produced using the average sales prices of each metal for each month during the period. Revenues from concentrate sales does not consider metallurgical recoveries in the calculations as the metal recoveries are built into the sales amounts.
In Q1 2023, AgEq was calculated using metal prices of US$22.59 per oz Ag, U$1,889 per oz Au, US$0.97 per lb of Pb and US$1.42 per lb of Zn. In Q1 2022, AgEq was calculated using metal prices of US$24.46 per oz Ag, U$1,934 per oz Au, US$1.07 per lb of Pb and US$1.83 per lb of Zn. In Q4 2022, AgEq was calculated using metal prices of US$22.70 per oz Ag, U$1,765 per oz Au, US$1.00 per lb of Pb and US$1.38 per lb of Zn.
Production was maintained at the previous quarter’s level. The head grades mined were lower due to stope selection of lower grading blocks to avoid poor gold recoveries for the higher quality ores while the plant’s gold circuit was repaired. Ore purchased from third parties increased the overall quantity of ore processed and represents overall 2.2% of total ore processed.
Underground development was emphasized with 649 meters of advances on the T1 and T2 veins on the levels 4700 and 4550. Silver X is planning to continue drilling at Tangana, particularly T1, T2 and T3 with up to 16 drillholes underneath the known mineralized zones, totaling 3,800 meters. Furthermore, additional surface drilling on the T1 vein is intended to prove up the extension of the vein on strike for more than 500 meters.
Qualified Person
Mr. A. David Heyl, B.Sc., C.P.G who is a qualified person under NI 43-101, has reviewed and approved the technical content of this news release for Silver X. Mr. A. David Heyl is a consultant for Silver X.
Cautionary Note regarding Production without Mineral Reserves
The decision to commence production at the Nueva Recuperada Project and the Company’s ongoing mining operations as referenced herein (the “Production Decision and Operations”) are based on economic models prepared by the Company in conjunction with management’s knowledge of the property and the existing estimate of inferred mineral resources on the property. The Production Decision and Operations are not based on a preliminary economic assessment, a pre-feasibility study or a feasibility study of mineral reserves demonstrating economic and technical viability. Accordingly, there is increased uncertainty and economic and technical risks of failure associated with the Production Decision and Operations, in particular: the risk that mineral grades will be lower than expected; the risk that additional construction or ongoing mining operations are more difficult or more expensive than expected; and production and economic variables may vary considerably, due to the absence of a detailed economic and technical analysis in accordance with NI 43-101.
About Silver X
Silver X is a growing silver producer building a multi-asset precious metals platform in Peru. The Company’s portfolio includes the Nueva Recuperada Project, a district-scale land package of over 20,000 hectares with two mining units and more than 200 exploration targets, as well as the recently acquired Pampas Project.
With existing production, scalable expansion opportunities, and significant exploration upside, Silver X is positioned for continued growth and long-term value creation. For more information visit our website at www.silverxmining.com.
On Behalf of the Board
José M. García
CEO and Director
For further information, please contact:
Simon Willcocks
Investor Relations
NON-IFRS MEASURES
The Company has included certain non-IFRS financial measures and ratios in this news release, as discussed below. The Company believes that these measures, in addition to measures prepared in accordance with IFRS, provide investors an improved ability to evaluate the underlying performance of the Company. The non-IFRS measures and ratios are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These financial measures and ratios do not have any standardized meaning prescribed under IFRS and therefore may not be comparable to other issuers.
EBITDA and Adjusted EBITDA
“EBITDA” is comprised as income (loss) less interest, income tax and depreciation and amortization. Management believes that EBITDA is a useful indicator for investors, and is used by management, in evaluating the operating performance of the Company. See “Reconciliation of Net (Loss) / Income to Adjusted EBITDA” for a quantitative reconciliation of EBITDA to the most directly comparable financial measure.
“Adjusted EBITDA” is comprised as income (loss) less interest, income tax, depreciation, amortization, share-based compensation, foreign exchange gain (loss), and certain non‑recurring or non‑cash items where applicable. Management believes that Adjusted EBITDA is a useful indicator for investors, and is used by management, in evaluating the operating performance of the Company. See “Reconciliation of Net (Loss) / Income to Adjusted EBITDA” for a quantitative reconciliation of Adjusted EBITDA to the most directly comparable financial measure.
Cash Costs and All-In Sustaining Cost (“AISC”)
The Company uses cash costs, cash costs per AgEq ounce produced, AISC, and AISC per AgEq ounce produced to manage and evaluate its operating performance in addition to IFRS measure because Company believes that conventional measures of performance prepared in accordance with IFRS do not fully illustrate the ability of its operations to generate cash flows. The Company understands that certain investors use these measures to determine the Company’s ability to generate earnings and cash flows for use in investing and other activities. Management and certain investors also use this information to evaluate the Company’s performance relative to peers who present this measure on a similar basis.
Cash costs are calculated by starting with cost of sales, and then adding treatment and refining charges, and changes in depreciation and amortization. Total cash production costs include cost of sales, changes in ore and concentrate inventories, changes in depreciation and amortization, less transportation and other selling costs and royalties. Cash costs per AgEq ounce is calculated by dividing cash costs by the AgEq ounces produced.
AISC and AISC per AgEq ounce produced are calculated based on guidance published by the World Gold Council (and used as a standard of the Silver Institute). The Company presents AISC based on AgEq ounces produced. AISC is calculated by taking the cash costs and adding sustaining costs. Sustaining costs are defined as capital expenditures and other expenditures that are necessary to maintain current production. Management has exercised judgment in making this determination.
The following table shows the calculation of the cash costs and AISC per AgEq ounces produced and per metric tonne processed:
Cautionary Note Regarding Production without Mineral Reserves
The decision to commence production at the Nueva Recuperada Project and the Company’s ongoing mining operations as referenced herein (the “Production Decision and Operations”) are based on economic models prepared by the Company in conjunction with management’s knowledge of the property and the existing estimate of mineral resources on the property. The Production Decision and Operations are not based on a preliminary economic assessment, a pre-feasibility study or a feasibility study of mineral reserves demonstrating economic and technical viability. Accordingly, there is increased uncertainty and economic and technical risks of failure associated with the Production Decision and Operations, in particular: the risk that mineral grades will be lower than expected; the risk that additional construction or ongoing mining operations are more difficult or more expensive than expected; and production and economic variables may vary considerably, due to the absence of a detailed economic and technical analysis in accordance with NI 43-101.
Cautionary Statement Regarding “Forward-Looking” Information
This press release contains forward-looking information within the meaning of applicable Canadian securities legislation (“forward-looking information”). Forward-looking information is generally identified by words such as “plans”, “expects”, “estimates”, “intends”, “anticipates”, “believes”, or similar expressions, including statements that certain events or results “may”, “could”, “would” or “will” occur. All statements other than historical facts constitute forward-looking information, including, without limitation, statements regarding exploration plans, operating results, expected project performance, the potential for resource expansion at Tangana, the economic viability of the Tangana Mining Unit, and the Company’s expected financial performance.
Forward-looking information is based on a number of assumptions, including that general economic and business conditions will not materially worsen; commodity demand and prices will remain stable or improve; required permits and approvals will be obtained on a timely basis; operations will not be materially disrupted by accidents, labour issues or equipment failures; financing will be available; equipment and supplies will be accessible as needed; resource estimates and underlying assumptions (including size, grade and recovery) are reasonable; and the Company will be able to attract and retain qualified personnel and execute its strategic objectives.
Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company, as the case may be, to be materially different from those expressed or implied by such forward-looking information, including but not limited to those risks described in the Company’s annual and interim MD&As and in its public documents filed on www.sedarplus.ca from time to time. Forward- looking statements are based on the opinions and estimates of management as of the date such statements are made. 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. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward- looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
