Americas Silver Corporation Provides First Quarter Production and Cost Update

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    TORONTO–(BUSINESS WIRE)–Americas Silver Corporation (TSX: USA) (NYSE American: USAS) (“Americas
    Silver” or the “Company”) today announced production and operating cost
    results for the first quarter of 2019 on a consolidated basis and
    individually for its Cosalá Operations and Galena Complex. All figures
    are in U.S. dollars unless otherwise indicated.

    First Quarter Highlights

    • Consolidated silver production of approximately 1.8 million silver
      equivalent1 ounces, an increase of 9% year-over-year, and
      395,000 silver ounces consistent with prior year.
    • Consolidated cash costs2 were approximately negative
      ($0.50) per silver ounce, a decrease of 144%, when compared to prior
      quarter. Consolidated all-in sustaining costs2 (“AISC”)
      were approximately $5.54 per silver ounce, a decrease of 53%, when
      compared to Q4 2018.
    • Milled tonnage at the Cosalá Operations increased by 24%
      year-over-year, with the San Rafael mine sustaining an average milling
      rate of approximately 1,750 tonnes per operating day. Production of
      approximately 1.3 million silver equivalent ounces including
      approximately 170,000 silver ounces, representing increases of 39% and
      118%, respectively, year-over-year. Cash costs were approximately
      negative ($30.48) per silver ounce and AISC were approximately
      negative ($25.85) per silver ounce representing decreases of 21% and
      130%, respectively, when compared to prior quarter.
    • Continuing operational challenges limited production at the Galena
      Complex to approximately 430,000 silver equivalent ounces including
      approximately 220,000 silver ounces, representing decreases of 15% and
      1%, respectively, when compared to prior quarter. Cash costs were
      approximately $23.03 per silver ounce and AISC were approximately
      $30.17 per silver ounce representing increases of 8% and 2%,
      respectively, when compared to prior quarter.
    • Subsequent to quarter end, the acquisition of Pershing Gold
      Corporation (“Pershing”) closed on April 3, 2019 after the Committee
      on Foreign Investment in the United States (“CFIUS”) completed its
      review. The Company announced concurrent financing signed with
      Sandstorm Gold Ltd. for gross proceeds of approximately US$42.5
      million to completely fund production at the Relief Canyon Project.
    • Guidance for 2019 remains unchanged at 1.6 – 2.0 million silver ounces
      and 6.6 – 7.0 million silver equivalent ounces at cash costs of $4.00
      to $6.00 per silver ounce and AISC of $10.00 to $12.00 per silver
      ounce. The Company expects to release its first quarter financial
      results on or before May 14, 2019.

    “The Cosalá Operations had an excellent quarter mining and processing an
    average of approximately 1,750 tonnes per operating day, resulting in
    greater silver and by-product metal production, with lower cash costs
    and AISC,” said Americas Silver President and CEO Darren Blasutti.
    “Construction activity at Relief Canyon is ramping up and orders for
    long-lead items have been placed as the Company advances this project
    towards pouring gold before the end of the year. With the addition of
    this new mine, the Company expects to increase precious metal production
    by over 500% by 2021.”

    Consolidated First Quarter Production Details

    Consolidated silver production for the first quarter of 2019 was 393,824
    ounces, which was largely consistent with both the prior quarter and
    year-over-year. Silver equivalent production was approximately 1.8
    million ounces, an increase of 9% year-over-year. Consolidated cash
    costs decreased 144% to negative ($0.50) per silver ounce compared to
    the prior quarter and increased 82% year-over-year, and AISC decreased
    53% to $5.54 per silver ounce compared to the prior quarter and
    decreased 10% year-over-year. Consolidated zinc production increased by
    10% compared to the prior quarter and 54% year-over-year, while
    consolidated lead production decreased by 10% compared to the prior
    quarter and increased by 8% year-over-year.

     

     

    Table 1
    Consolidated Production Highlights

     

        Q1 2019   Q1 2018   Change   Q4 2018   Change
    Processed Ore (tonnes milled)   182,029   163,875   11%   186,585   -2%
    Silver Production (ounces)   393,824   397,035   -1%   395,294   -1%
    Silver Equivalent Production (ounces)   1,754,839   1,613,711   9%   1,799,741   -2%
    Silver Grade (grams per tonne)   87   95   -8%   87   0%
    Cost of Sales ($ per equiv. ounce silver)   $7.11   $8.14   -13%   $7.87   -10%
    Cash Costs ($ per ounce silver)   ($0.50)   ($2.73)   82%   $1.14   -144%
    AISC ($ per ounce silver)   $5.54   $6.17   -10%   $11.78   -53%
    Zinc Production (pounds)   11,263,623   7,332,978   54%   10,223,692   10%
    Lead Production (pounds)   8,211,429   7,624,685   8%   9,088,862   -10%

    Cosalá Operations Production Details

    The Cosalá Operations produced 173,169 ounces of silver during the first
    quarter of 2019 and 1,322,045 ounces of silver equivalent during the
    same period at cash costs of negative ($30.48) per silver ounce and AISC
    of negative ($25.85) per silver ounce. Silver production increased by
    118% year-over-year and consistent with the fourth quarter 2018, while
    silver equivalent production increased by 39% year-over-year and 3% over
    the prior quarter. Cash costs and AISC improved by 21% and 130%,
    respectively, compared to the Q4 2018.

     

    Table 2
    Cosalá Operations Highlights

     

        Q1 2019   Q1 2018   Change   Q4 2018   Change
    Processed Ore (tonnes milled)   152,605   123,285   24%   149,577   2%
    Silver Production (ounces)   173,169   79,382   118%   172,016   1%
    Silver Equivalent Production (ounces)   1,322,045   948,081   39%   1,287,657   3%
    Silver Grade (grams per tonne)   57   42   36%   59   -3%
    Cost of Sales ($ per equiv. ounce silver)   $4.35   $5.92   -27%   $4.66   -7%
    Cash Costs ($ per ounce silver)   ($30.48)   ($59.52)   -49%   ($25.12)   21%
    AISC ($ per ounce silver)   ($25.85)   ($36.28)   -29%   ($11.26)   130%
    Zinc Production (pounds)   11,263,623   7,332,978   54%   10,223,692   10%
    Lead Production (pounds)   4,626,233   2,679,485   73%   4,388,146   5%

    Strong results were driven by sustained improvements in grade, mill
    throughput and metal recovery to concentrate. Site expenditures tracked
    expectations. Development of the incline ramp toward San Rafael’s Upper
    Zone has resumed and is advancing ahead of plan. Ore production from the
    Main Zone benefited from the additional working headings providing
    operational flexibility. Further, mined head grades exceeded budgeted
    head grades during the quarter. Any potential reduction in head grades
    over the remainder of the year are expected to be largely offset by
    further gains in mill throughput and metal recovery as additional
    flotation capacity is installed during the second quarter.

    Galena Complex Production Details

    Unplanned mill downtime due to problems with the mill pinion bearing at
    the Galena mine in January set the year off on a challenging note
    however the underlying issues were successfully resolved during the
    quarter. Performance trended back up until two separate ground falls
    delayed production from two high-tonnage stopes. The cumulative impact
    was the loss of nearly one month’s production during the quarter.
    Performance is slowly improving and should return to expected levels by
    the end of Q2 2019. Management remains committed to returning the
    operation to an acceptable level of performance.

    As a result of these unexpected incidents, the Galena Complex produced
    220,655 ounces of silver during Q1 2019 and 432,794 ounces of silver
    equivalent at cash costs of $23.03 per silver ounce and AISC of $30.17
    per silver ounce. Silver and silver equivalent production decreased by
    1% and 15%, respectively, compared to the prior quarter, and 31% and
    35%, respectively, year-over-year. Cash costs and AISC increased by 8%
    and 2%, respectively, due to the noted operational challenges.

     

    Table 3
    Galena Complex Highlights

     

        Q1 2019   Q1 2018   Change   Q4 2018   Change
    Processed Ore (tonnes milled)   29,424   40,590   -28%   37,008   -20%
    Silver Production (ounces)   220,655   317,653   -31%   223,278   -1%
    Silver Equivalent Production (ounces)   432,794   665,630   -35%   512,084   -15%
    Silver Grade (grams per tonne)   242   256   -5%   199   22%
    Cost of Sales ($ per equiv. ounce silver)   $15.55   $11.31   38%   $15.95   -2%
    Cash Costs ($ per ounce silver)   $23.03   $11.46   101%   $21.36   8%
    AISC ($ per ounce silver)   $30.17   $16.78   80%   $29.52   2%
    Lead Production (pounds)   3,585,196   4,945,200   -28%   4,700,716   -24%

    Relief Canyon Update

    On April 3, 2019, the Company announced the closing of the Pershing
    acquisition after receiving notification that CFIUS completed its
    review. The Company also announced a financing package of $42.5 million
    secured from Sandstorm Gold Ltd. to fully fund the development of Relief
    Canyon and Board approval for construction commencement at the Project
    with the intention of pouring gold before year end. Since that time,
    orders have been placed for long-lead items such as the mill liners,
    crusher and conveyor system and negotiations have commenced on the leach
    pad construction and mining contracts. Expected start dates are mid-May
    and mid-June respectively. Further information on the Relief Canyon
    development will be made available periodically on the Company’s website
    as construction progresses at www.americassilvercorp.com.

    Americas Silver Annual and Special Meeting

    The annual and special meeting of Americas Silver is scheduled for 3pm
    (EDT) on Wednesday May 15, 2019 at Vantage Venues, 150 King St. West,
    Toronto, Ontario.

    Your vote is important. Please vote before the proxy vote deadline on
    May 13, 2019 at 3pm (EDT).

    Additional information concerning the annual and special meeting can be
    found in the Management Information Circular dated April 18, 2019. An
    electronic copy of the Circular is available online under the Company’s
    profile at www.sedar.com
    or at www.americassilvercorp.com.

    About Americas Silver Corporation

    Americas Silver is a precious metal mining company focused on growth
    from its existing asset base and execution of targeted accretive
    acquisitions. It owns and operates the Cosalá Operations in Sinaloa,
    Mexico and the Galena Complex in Idaho, USA. The Company expects to
    begin producing gold in the fourth quarter of 2019 at its fully-funded
    Relief Canyon Project, in Nevada, USA which is currently in
    construction. For further information, please see SEDAR or
    americassilvercorp.com.

    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 Silver’s expectations,
    intentions, plans, assumptions and beliefs with respect to, among other
    things, Americas Silver’s financing efforts; construction, production,
    and development plans at the Relief Canyon Project and performance
    expectations for the Relief Canyon Project and impact on Americas
    Silver’s financial performance; and the estimated construction timeline
    and costs for the Relief Canyon Project; the estimated timeline for
    environmental approvals for the second phase of the Relief Canyon
    Project; and the impact of the Transaction on the liquidity of the
    Company’s shares. 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 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 Silver to be materially different from those expressed or
    implied by such forward-looking information. With respect to the
    Sandstorm financing, risks and uncertainties include the ability of the
    Company and its subsidiaries to fulfill the conditions to drawing all
    the available funds under the purchase agreement and convertible
    debenture and the potential for, and consequences of, default
    thereunder. With respect to the business of Americas Silver, these risks
    and uncertainties include 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 develop, complete construction and operate the
    Relief Canyon Project; and risks associated with the mining industry
    such as economic factors (including future commodity prices, currency
    fluctuations and energy prices), ground conditions and other factors
    limiting mine access, 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, social and political
    developments and other risks of the mining industry. 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
    Pershing Gold’s filings with the SEC, including the Annual Report on
    Form 10‐K for the year ended December 31, 2017 and the Proxy Statement
    of Pershing Gold dated November 29, 2018, and in Americas Silver’s
    filings with the Canadian Securities Administrators on SEDAR and with
    the SEC, including the management information circular of Americas
    Silver dated December 4, 2018. Americas 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 Silver does not give any assurance (1) that Americas
    Silver will achieve its expectations, or (2) concerning the result or
    timing thereof. All subsequent written and oral forward‐looking
    information concerning Americas Silver, the Transaction, the Sandstorm
    financing package, the combined Company or other matters attributable to
    Americas Silver or any person acting on its behalf are expressly
    qualified in their entirety by the cautionary statements above.

    1 Silver equivalent production throughout this press release
    was calculated based on silver, zinc, and lead realized prices during
    each respective period.

    2 Cash cost per ounce and all-in sustaining cost per ounce
    are non-IFRS performance measures with no standardized definition. For
    further information and detailed reconciliations, please refer to the
    Company’s 2018 year-end and quarterly MD&A. The performance measures for
    the quarter ended March 31, 2019 are preliminary throughout this press
    release subject to refinement from the Company’s first quarter financial
    results to be released on or before May 14, 2019.

    Contacts

    Darren Blasutti
    President and CEO
    Americas Silver Corporation
    416‐848‐9503