Santacruz Silver Quarterly Update - Q2 2025

• Revenue of $73.3 million, up 4% year-over-year
• Net income of $21.0 million, a 1,348% increase from Q2 2024
• Adjusted EBITDA of $26.8 million, up 68% year-over-year
• Cash and investments totalled $57.8 million, compared to $7.3 million in Q2 2024
• Cash cost per silver equivalent ounce decreased 10% to $19.48

Santacruz Silver Mining Ltd. (TSX.V:SCZ) is a Latin American precious metals producer operating five mining complexes across Bolivia and Mexico. The company generates revenue through the extraction, processing, and sale of silver, zinc, lead, and copper concentrates to international markets. Its operations include the Bolivar, Porco, and Caballo Blanco mining complexes in Bolivia, the San Lucas ore sourcing business, and the Zimapán mine in Mexico.

Financial Performance and Profitability

Revenue increased 4% to $73.3 million in Q2 2025 compared to $70.5 million in Q2 2024. The company reported gross profit of $25.3 million, representing a 59% increase from $15.9 million in the prior year quarter. Silver equivalent production totalled 3.55 million ounces compared to 4.17 million ounces in Q2 2024.

Net income reached $21.0 million compared to $1.4 million in Q2 2024. The company's adjusted EBITDA increased to $26.8 million from $16.0 million in the same period last year. These results reflect improved margins and operational efficiency across the company's mining portfolio.

Working capital stood at $60.3 million at quarter end, compared to $15.0 million in Q2 2024. Cash and cash equivalents totalled $40.0 million, with an additional $17.8 million in short- and long-term investments. During the quarter, the company made a $7.5 million payment to Glencore under an acceleration payment plan.

Operational Results and Production

Silver equivalent production totalled 3,547,054 ounces in Q2 2025 compared to 4,166,364 ounces in Q2 2024. Production was impacted by a water inflow at the Bolivar mine in mid-May that temporarily restricted access to the Pomabamba and Nane veins. The company processed 480,863 tonnes of ore during the quarter.

The San Lucas ore sourcing business supported operations during the temporary disruption at Bolivar. Other operations showed varied results, with Caballo Blanco achieving higher grades and improved recoveries, while Zimapán maintained stable silver equivalent output. Silver recovery rates averaged 81% across operations.

Production metrics showed 1,423,081 ounces of silver produced, along with 21,148 tonnes of zinc and 2,773 tonnes of lead. The company sold 2,993,136 payable silver equivalent ounces during the quarter at an average realised price of $32.37 per ounce, compared to $30.40 per ounce in Q2 2024.

Cost Management and Operations

Cash costs per silver equivalent ounce sold decreased 10% to $19.48 compared to $21.66 in Q2 2024. All-in sustaining cash costs per ounce improved 8% to $22.95 from $24.91 in the prior year quarter. The cost improvements were achieved across multiple operations.

Caballo Blanco recorded the most significant cost reduction, with all-in sustaining costs declining to $13.87 per ounce. This improvement reflected operational efficiencies and the impact of recording transactions in Bolivian Bolivianos using a market-based exchange rate of 13.44 BOB/USD instead of the official rate of 6.96 BOB/USD, effective January 1, 2025.

Bolivar's all-in sustaining costs increased to $17.55 per ounce reflecting lower production volumes from the water inflow incident. San Lucas reported costs of $23.69 per ounce, which the company attributes to its margin-based sourcing model where ore costs adjust with metal prices.

Outlook

The company expects production at Bolivar to normalise by Q4 2025 as remediation efforts continue. Management stated that the company remains focused on operational efficiency and balance sheet strength. CEO Arturo Préstamo noted:

"Remediation efforts are underway, and we expect production at Bolivar to normalize by Q4 2025."

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