Mr. Robert Archer reports

GREAT PANTHER SILVER REPORTS SECOND QUARTER 2014 PRODUCTION RESULTS

Great Panther Silver Ltd. has released second-quarter production results at its two wholly owned Mexican silver mining operations, Guanajuato and Topia, and has provided an update on its exploration and development activities.

Second-quarter 2014 operations highlights (compared with second quarter 2013):

• Ore processed increased 20 per cent to a record 80,964 tonnes.
• Metal production rose 6 per cent to 718,794 silver equivalent ounces.
• Silver production was up 6 per cent to 420,001 silver ounces.
• Gold production decreased 6 per cent to 3,773 gold ounces.
• San Ignacio started commercial production in June.

Great Panther delivered continued growth in metal production during the second quarter of 2014. Production in terms of silver equivalent ounces increased 6 per cent compared with the second quarter of 2013 and showed an 8-per-cent increase over the first quarter of 2014. This was primarily due to increased mill throughput at both mines combined with better silver grades from the Guanajuato mine complex over the first quarter as operations fully resumed after the disruptions in the first quarter. At Guanajuato, the start of commercial production at San Ignacio in June and the provision of preproduction development ore contributed to the increased throughput and metal production.

"We saw a steady improvement at Guanajuato through the quarter and were very pleased to initiate commercial production on schedule at San Ignacio, a new satellite operation of Guanajuato," stated Robert Archer, president and chief executive officer. "We anticipate that production growth will continue, especially as we ramp up production at San Ignacio."

         CONSOLIDATED SECOND-QUARTER OPERATIONS SUMMARY 

                       Q2 2014   Q2 2013     Q2 2014   Q1 2014
Ore processed (tonnes
milled)                 80,964    67,569      80,964    72,631
Silver equivalent
ounce production       718,794   680,212     718,794   667,349
Silver ounce
production             420,001   396,730     420,001   370,668
Gold ounce production    3,773     3,994       3,773     3,666
Lead production
(tonnes)                   302       243         302       308
Zinc production
(tonnes)                   395       411         395       431
Total underground
development (m)          5,112     4,044       5,112     3,878
Underground diamond
drilling (m)             2,788     6,907       2,788     4,172

Guanajuato mine complex

Ore processed at Guanajuato increased 20 per cent and 15 per cent, to a record 63,646 tonnes, compared with the same period in 2013 and the first quarter of 2014, respectively. This resulted in a 1-per-cent and 15-per-cent increase in metal production for the comparative period last year and the first quarter of 2014, respectively. Metal production for the second quarter of 2014 included 251,687 silver ounces and 3,648 gold ounces, or 470,589 silver equivalent ounces, at grades of 139 grams per tonne silver and 1.99 grams per tonne gold.

         GUANAJUATO SECOND-QUARTER OPERATIONS SUMMARY   

                       Q2 2014   Q2 2013      Q2 2014   Q1 2014
Ore processed (tonnes
milled)                 63,646    52,917       63,646    55,280
Silver equivalent
ounce production       470,589   466,925      470,589   408,942
Silver ounce
production (1)         251,687   236,454      251,687   199,059
Gold ounce production    3,648     3,841        3,648     3,498
Ag grade (g/t)             139       159          139       128
Au grade (g/t)            1.99      2.47         1.99      2.19
Ag recovery (%)          88.4%     87.2%        88.4%     87.3%
Au recovery (%)          89.4%     91.5%        89.4%     90.1%
Total underground
development (m)          2,403     1,790        2,403     1,891
Underground diamond
drilling (m)             2,392     6,426        2,392     3,532

(1) Silver equivalent ounces for 2014 are established using 
prices of $18.50 (U.S.) per ounce, $1,110 (U.S.) per ounce 
(60:1 ratio), 90 U.S. cents per pound and 85 U.S. cents per 
pounds for silver, gold, lead and zinc, respectively, and 
applied to the recovered metal content of the concentrates that 
were produced by the Guanajuato operation, including production 
from the San Ignacio mine.

Ore processed at Guanajuato came primarily from the Cata mine followed by the Santa Margarita, Los Pozos and Guanajuatito mines. Production growth from the Cata mine was achieved through synchronized exploitation of the hangingwall veins (Alto 1, 2 and 4), Contact vein and the main Veta Madre vein from the upper 390-metre level to the 540-metre level. The gradual increase of mill feed from San Ignacio also contributed to overall production volumes, accounting for a total of 12,880 tonnes in the second quarter.

Both silver and gold grades decreased over the corresponding period in 2013, however, silver grades improved 9 per cent over the first quarter of 2014. Gold grades were slightly below those of the previous quarter as work at the gold-rich Santa Margarita mine focused on the development of new production levels.

The plant delivered metal recoveries of 88.4 per cent for silver and 89.4 per cent for gold. Silver recoveries improved slightly compared with the same quarter last year and the first quarter of this year due to modifications in the flotation circuit, however, gold recoveries declined due to the processing of lower gold grade ore.

The second quarter of 2014 saw less exploration drilling at Guanajuato compared with both the same period in 2013 and the previous quarter due to a greater focus on the preparation of underground infrastructure for future drilling. The majority of the diamond drilling during the quarter was undertaken at the Cata mine, exploring the hangingwall veins system (Altos) from the 490- to the 540-metre levels. In addition, extension and infill drilling was conducted at the upper levels of Santa Margarita between the 345- and 275-metre levels. This provided encouraging intersections of the Veta Madre and Santa Margarita veins, including two intermediate mineralized structures. The drilling program for the second half of 2014 is composed of infill and extension drilling primarily at the deep Cata and Santa Margarita mines.

Underground development at Guanajuato was up 34 per cent and 27 per cent compared with the same period in 2013 and the first quarter of 2014, respectively. Encouraging drill intercepts were revealed in the primary Veta Madre vein at the 540-metre level of the Cata mine. Further development was conducted to explore and define the continuity of the Alto 4 and Alto 2 veins at the 465-metre and 490-metre level, respectively. The Guanajuatito mine access ramp reached the 285-metre level and the vein was successfully intersected by crosscutting leading to the initiation of mining on this level subsequent to the end of the quarter.

San Ignacio mine

As noted, San Ignacio commenced commercial production in June and contributed 12,880 tonnes of mill feed for the second quarter. This represented a 60-per-cent increase compared to the first quarter of 2014 during which development ore only was processed. Metal production from San Ignacio was 87,705 silver equivalent ounces, which included 35,294 silver ounces and 873 gold ounces, or 87,705 silver equivalent ounces at ore grades of 104 grams per tonne silver and 2.55 grams per tonne gold. The gradual increase of preproduction mill feed followed by the commencement of stope production contributed to the company's overall production and is included under the Guanajuato mine complex. The mine is currently operating at a run rate of approximately 200 tonnes per day and will increase gradually as new stopes are brought into production.

Early in the second quarter, preproduction operations at San Ignacio focused primarily on the 2,300-metre level (above mean sea level), developing access drifts and preparing stopes on the Intermediate vein and, to a lesser degree, on the Melladito vein. Exploration crosscuts revealed well-mineralized vein material that was subsequently mined. Stoping commenced later in the quarter on the 2,300-, 2,320- and 2,317-metre levels. The mine ventilation system was upgraded with a ventilation raise connecting the 2,317-metre level to the surface.

The ramp has reached the 2,280-metre level where the company is developing a new production level and stopes on both the Intermediate and Melladito veins. The access ramp is anticipated to reach the 2,250-metre level by the end of the third quarter.

Ancillary surface infrastructure at San Ignacio was further improved by the completion of the mechanical services workshop. This is expected to reduce equipment maintenance times and increase mechanical availabilities. The mine portal patio was expanded to facilitate the transition of employees and equipment in and out of the mine and an additional air compressor was installed to support the existing line.

Topia mine

Ore processed at Topia increased 18 per cent to 17,319 tonnes when compared with the corresponding quarter in 2013, and remained steady when compared to the first quarter of 2014. Total metal production increased 16 per cent over the same quarter in 2013 but decreased slightly over the first quarter of this year. Metal production for the second quarter included 168,314 silver ounces, 125 gold ounces, 302 lead tonnes and 395 zinc tonnes, or 248,205 silver equivalent ounces. Ore grades were 336 grams per tonne silver, 0.40 gram per tonne gold, 1.84 per cent lead and 2.49 per cent zinc. Silver grades were down somewhat from the same quarter the previous year but only slightly down from the first quarter of this year.

            TOPIA SECOND-QUARTER OPERATIONS SUMMARY 

                       Q2 2014   Q2 2013      Q2 2014   Q1 2014
Ore processed (tonnes
milled)                 17,319    14,652       17,319    17,351
Silver equivalent
ounce production       248,205   213,287      248,205   258,407
Silver ounce
production             168,314   160,276      168,314   171,609
Gold ounce production      125       153          125       168
Lead production
(tonnes)                   302       243          302       308
Zinc production
(tonnes)                   395       411          395       431
Ag grade (g/t)             336       376          336       344
Au grade (g/t)            0.40      0.57         0.40      0.56
Ag recovery (%)          89.8%     90.6%        89.8%     89.4%
Au recovery (%)          56.1%     57.0%        56.1%     53.8%
Total underground
development (m)          2,708     2,254        2,708     1,987
Underground diamond
drilling (m)               396       481          396       641

Ore processed at Topia came primarily from the Argentina, Durangueno and 15-22 mines, which accounted for approximately 50 per cent of throughput. The lower ore grades for the second quarter can be attributed to higher dilution and mining from zones under development. The reduction of dilution is a continuing priority in order to increase ore grades at Topia. Furthermore, each mine is continually assessed as to its individual economic viability and, at the end of June, the Oliva mine was shut down. Men and equipment have redeployed elsewhere so as to have no impact on production.

Metal recoveries were down slightly when compared with the same quarter in 2013, at 89.8 per cent for silver, 56.1 per cent for gold, 94.7 per cent for lead and 91.6 per cent for zinc. However, these recoveries were an improvement over the first quarter of this year due to process optimization measures implemented earlier this year on the crushing and flotation circuits of the plant.

As anticipated, exploration development at the Durangueno and San Gregorio mines intersected the Rosario vein and development was carried out to prepare sublevels, raises and stopes for production.

Underground development was up 20 per cent and 36 per cent, to 2,708 metres, compared with the same period in 2013 and the first quarter of 2014, respectively, as a result of a new development program focused on extending access ramps and drifts to new mineralized zones.

El Horcon

At this time, plans for El Horcon are limited to applying for the necessary government permits to allow further exploration and development. This project has the potential to be another satellite mine to the company's Guanajuato operation, leveraging excess capacity at its Cata processing plant.

Outlook

The company is maintaining its 10-per-cent production growth guidance for 2014 and cash costs are expected to improve as the company progresses throughout the year. However, due to the focus on San Ignacio development and efforts to normalize operations at Guanajuato from the disruptions in the first quarter, the company is reviewing its cost guidance and will provide a further update with the second-quarter earnings release.

             2014 PRODUCTION AND CASH COST GUIDANCE   

                                         2013 actual  2014 guidance range

Total silver equivalent ounces             2,840,844  3,100,000-3,200,000
Consolidated cash costs per silver                                          
payable ounce (U.S.)                          $13.45        $11.00-$12.00
Consolidated all-in sustaining costs per                                    
silver payable ounce (U.S.)                      n/a        $17.50-$19.50
Consolidated all-in costs per silver                                        
payable ounce (U.S.)                             n/a        $20.00-$21.00

With silver and gold prices remaining at relatively low levels, management will continue to look for ways to reduce costs and improve operational efficiencies and grade control. However, both Guanajuato and Topia have complex geology, and the measures taken to mitigate grade variability cannot serve to completely eliminate this factor.

Exploration drilling at Guanajuato will focus on upgrading mineral resource estimates at Valenciana, Cata, San Cayetano, Guanajuatito and Los Pozos before the end of the year.

Exploration drilling at San Ignacio will focus on expanding and upgrading the mineral resource at the Intermediate, Melladito and Nombre de Dios zones in areas adjacent to the ramp development in the third quarter.

We seek Safe Harbor.