Silvercorp Metals Reports Higher Q1 Fiscal 2027 Revenue Amid Voluntary China Safety Suspension

• Revenue was $138.7 million for the quarter ended June 30, 2026, up 70% year over year, primarily due to a 135% increase in the average realised silver price.
• Adjusted net income attributable to shareholders was $53.9 million, or $0.24 per share.
• Cash flow from operating activities was $61.7 million, compared to $48.3 million in the same quarter last year.
• Operations at the Ying Mining District and GC Mine in China were voluntarily suspended in mid-June to complete safety upgrades required under new government regulations, with Ying's production expected to decrease by 40% to 50% in the second quarter.
• Total capital expenditures were $37.7 million for the quarter, supporting construction at the El Domo project in Ecuador, the Tulkubash project in Kyrgyzstan, and the Kuanping project in China.

Silvercorp Metals Inc. (TSX/NYSE American: SVM) is a Canada-based company that produces silver, gold, lead, and zinc. The company operates two producing mines in China, the Ying Mining District and the GC Mine, and has projects under construction in Ecuador and Kyrgyzstan. The company's strategy focuses on generating free cash flow from long-life mines, growing production through exploration, pursuing acquisitions, and maintaining a long-term commitment to responsible mining.

Revenue, Adjusted Net Income and Cash Flow

Revenue for the first quarter of fiscal 2027 was $138.7 million, an increase of 70% compared to the same quarter last year. The company sold approximately 1.5 million ounces of silver, along with gold, lead, and zinc. Silver accounted for 77% of total revenue for the quarter, with the average realised silver price rising 135% year over year to $69.38 per ounce.

Adjusted net income attributable to shareholders was $53.9 million, or $0.24 per share, compared to $0.10 per share in the same quarter last year. Adjusted EBITDA, which measures earnings before interest, income tax, depreciation, and amortisation, was $77.3 million, up from $35.0 million a year earlier. Net income attributable to shareholders, which includes non-cash and one-time items, was $59.4 million, or $0.27 per share.

Cash flow from operating activities was $61.7 million, an increase of $13.4 million from $48.3 million in the same quarter last year. Free cash flow, which reflects cash generated after capital spending, was $28.6 million, compared to $22.5 million a year earlier. The company ended the quarter with cash, cash equivalents, and short-term investments totalling $387.1 million, along with an equity investment portfolio valued at $303.6 million.

Voluntary Safety Compliance Suspension at Ying and GC

Beginning in mid-June, Silvercorp suspended operations at its Ying Mining District and GC Mine in China to conduct self-reviews and install the "Six Major Safety Systems," a set of underground safety upgrades required under new regulations issued by the Chinese government.

At Ying, five vendors have been engaged to complete the upgrades, which carry an estimated budget of $11.5 million. Production at Ying is expected to decrease by 40% to 50% in the second quarter of fiscal 2027 as a result of the suspension. At GC, the self-review has been completed and submitted to the Municipal Work Safety Committee for approval, with underground upgrades to proceed once approval is granted.

Silver production at Ying decreased 16% and at GC decreased 39% compared to the same quarter last year, due to lower head grades and the production suspension beginning in mid-June.

Multi-Project Construction Advancement

At El Domo in Ecuador, capital expenditures were $12.3 million for the quarter, bringing cumulative project spending to $66.2 million. Work during the quarter included excavation for the tailings storage facility, foundation work for the processing plant, and the start of pre-stripping at the open pit. The company has contracted TGJA to construct the process plant and is targeting commissioning of the mine by July 2027.

At the Tulkubash project in Kyrgyzstan, capital expenditures were $0.6 million for the quarter. China Railway 19th Bureau Group Co., Ltd. was selected as the mining contractor following a bidding process involving five companies. Construction of a temporary camp is underway, and access roads to the open pit and heap leach pad area are being built. A bankable feasibility study for the project, prepared by LogiProc, is expected to be completed in mid-August 2026.

At the Kuanping project in China, capital expenditures were $1.8 million for the quarter, including 3,217 metres of ramps and development tunnels and 3,716 metres of diamond drilling. Capital expenditures across the company's China operations, including Ying, GC, and Kuanping, totalled $22.3 million for the quarter.

Milestones and Next Steps

Subsequent to the quarter, Silvercorp received a $43.9 million instalment under its $175.5 million stream financing agreement for the El Domo project, to be applied toward continued mine construction. On August 4, 2026, the company received approval from the Department of Natural Resources of Guangdong Province to reclassify the GC Mine from a lead-zinc property to a silver mine, and will proceed with the formal process to complete the classification change. A conference call to discuss the quarter's results is scheduled for August 11, 2026.

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