Mr. Alberto Morales reports

ANDEAN PRECIOUS METALS REPORTS SOLID Q2 2023 RESULTS SUPPORTED BY STRONG PRODUCTION AND IMPROVING COSTS

Andean Precious Metals Corp. has released its operating highlights and unaudited condensed interim financial results for the three and six months ended June 30, 2023. All amounts are expressed in United States dollars, unless otherwise noted. This news release should be read together with Andean's financials, which are available under the company's profile on SEDAR+.

Q2 2023 highlights

Three months ended June 30, 2023, versus three months ended March 31, 2023

• Produced 1.2 million silver equivalent ounces (AgEq oz), an increase of 22 per cent. The company is reaffirming its full year 2023 production guidance of 4.8 million to 5.2 million AgEq oz.
• Recovery rates improved with an average of 79 per cent in each of the first two quarters of 2023. For the first half of 2023 compared with the first half of 2022, the average recovery rate improved from 76 per cent to 79 per cent.
• Of the 1.2 million ounces produced, 600,000 AgEq oz were sold at an average realized price of $24.65 per ounce for Q2 2023 revenue of $15.3-million. The 38-per-cent decrease in ounces sold in Q2 2023 versus Q1 2023 was due to the sales deferral of approximately 540,000 AgEq oz, which was classified as inventory and valued at $11.3-million. Subsequent to June 30, 2023, the bullion was sold for total revenue of $13.3-million based on an average realized price of $24.70 per ounce.
• Cost of sales decreased by 45 per cent to $11.8-million predominantly due to lower ounces sold and a decrease of $1.2-million in mining and material purchasing costs.
• Operating cash costs (OCC) per ounce of silver produced, net of byproduct credits, was $19.15, a decrease of 11 per cent.
• All-in sustaining costs (AISC) per silver ounce sold, net of byproduct credits, was $23.69, a decrease of only 2 per cent despite lower ounces sold.
• General and administrative (G&A) expenses of $3.1-million were $700,000 higher quarter over quarter due to increased corporate development activities as well as a stronger Mexican peso relative to the United States dollar. G&A decreased by $400,000 and by $800,000, respectively, compared with Q2 2022 and H1 2022.
• Income from mine operations increased to $2.4-million from $400,000.
• Net income attributable to equity holders remained unchanged at $200,000.
• For Q2 2023, earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) was $3.7-million and $4.9-million, respectively, compared with $1.5-million and $1.4-million, respectively, in Q1 2023. EBITDA improved by $700,000 and adjusted EBITDA improved by $900,000 in the first six months of 2023 compared with the first six months of 2022.

Liquidity and capital resources

• Debt-free balance sheet with cash and cash equivalents of $70.4-million. Cash was lower due to the sales deferment of approximately 540,000 AgEq oz, which were sold in July, 2023, at an average price of $24.70 per Ag oz, representing revenue of $13.3-million.
• Positive working capital of $90.3-million as at June 30, 2023, including liquid assets of $89.9-million, comprising $70.4-million in cash, silver bullion of $13.3-million, marketable securities of $4.7-million and VAT certificates receivable of $1.5-million. Liquid assets were $91.8-million as at Dec. 31, 2022.
• Pursuant to its normal course issuer bid (NCIB), the company repurchased and cancelled 1,430,500 shares at an average purchase price of 77 Canadian cents per share for a total of $800,000 ($1.1-million (Canadian)). Since the inception of the NCIB in the fall of 2022 to the end of June, 2023, a total of 2,379,600 shares have been repurchased and cancelled at an average purchase price of 80 Canadian cents for a total of $1.4-million ($1.9-million (Canadian)).
• During Q2 2023, the company entered into silver sales forward contracts for the delivery of 1,025,000 ounces of silver at an average price of $25.75 per ounce. As a result of the decrease in the silver price in May, the forward contracts were unwound, and net cash settled in May, 2023, resulting in a realized gain of $2.3-million in Q2 2023.
• To mitigate silver price fluctuation risks and its impact on revenue, the company entered into zero-cost collar contracts with an average put strike price of $23 per ounce and an average call strike price of $30 per ounce for 200,000 ounces per month from August, 2023, to December, 2023. As at June 30, 2023, the company recognized an unrealized gain of $1.0-million on the fair value of the contracts.

Growth

• The company signed a mineral purchase agreement with Empresa Minera Bedrock SRL for 170,000 metric tonnes over the next 24 months from Bedrock's Alta Vista project, located 420 kilometres from San Bartolome. The materials from the Alta Vista project have an expected head grade of approximately 350 grams per tonne. The first material delivery is expected in late Q3 2023.
• The silver recovery project at the company's fines disposal facility (FDF) continues to advance. Production is expected to commence in the first half of 2024.

Environment and health and safety

• During Q2 2023, the company achieved a lost-time injury frequency rate of zero per one million hours worked and attained a significant safety milestone of 1,452,000 operating hours with no lost time injury.
• There were zero significant environmental incidents and zero reportable spills for the three- and six-month periods ended June 30, 2023.

"This quarter we increased production and operational efficiencies and maintained recoveries compared with the first quarter. These upward trends continued in July," stated Alberto Morales, executive chairman and chief executive officer of Andean.

Mr. Morales continued: "We remain focused on extending the life of San Bartolome and are making significant progress on the tailings silver recovery project at our fines disposal facility. We anticipate publishing a mineral resource estimate shortly, filing a technical report and commencing production in the first half of 2024. In parallel, we are actively engaged in acquisition activities in the Americas, aiming to become a multijurisdictional mid-tier producer."

2023 guidance

• The company's 2023 outlook was disclosed in the MD&A (management discussion and analysis) for the year ended Dec. 31, 2022, filed under the company's profile on SEDAR+.
• The company is reaffirming its full-year 2023 production guidance of 4.8 million to 5.2 million AgEq oz. During H2 2023, the company will continue to process material from its surface deposits and from new material purchasing contracts, including the recently signed one with Bedrock for the Alta Vista deposit. Additionally, the company will continue to purchase material from community mining partners and explore opportunities to source additional feed from third parties and COMIBOL. As previously disclosed, approximately 54 per cent of 2023 production is expected in the second half of the year.
• Although management continues to successfully address last year's recovery issues and other challenges, further work remains. While management anticipates production to increase and costs to improve in the second half of the year, these results may not be sufficient to offset the impact of the first two quarters. Accordingly, the company is increasing its full year 2023 AISC guidance from a range of $19.50 to $20.30 to $20.90 to $21.95.
• Due to revised engineering design and procurement plans, capital expenditures are expected to be in the range of $6.5-million to $8.5-million, lower than the range of $8.0-million to $10.0-million in the original guidance. The company continues to work with consultants on the FDF project, including advanced metallurgical testing and geotechnical studies. The company has started assessing engineering and construction options and expects to commence production in the first half of 2024.

The attached table sets out Andean's year-to-date results against both its original and revised 2023 guidance.

Q2 2023 webcast

Management will host a webcast tomorrow morning to discuss the company's Q2 2023 financial and operating results. A question-and-answer session will follow management's prepared remarks. Details of the webcast are as displayed.

Date and time:   Wednesday, Aug. 16, 2023, at 9 a.m. ET

Registration is open now and will be available up and until the date and time of the webcast.

Webcast access:  Upon registration, participants will receive an automatic email from Zoom with a link to access the webcast.

To access the live webcast of the earnings call, please connect at least 15 minutes prior to the start time to ensure adequate time for any software download that may be required to join the webcast.

Replay:  A replay of the webcast will be available within approximately 48 hours after the live event at the company website.

Qualified person statement

The scientific and technical content disclosed in this press release was reviewed and approved by Donald J. Birak, independent consulting geologist to the company, a qualified person as defined by National Instrument 43-101 -- Standards for Disclosure for Mineral Projects, registered member, Society for Mining, Metallurgy and Exploration (SME), fellow, Australasian Institute of Mining and Metallurgy (AusIMM).

About Andean Precious Metals Corp.

Andean is a growth-focused precious metals producer that owns and operates the San Bartolome project located in the department of Potosi, Bolivia. San Bartolome has been operating continuously since 2008, producing an average of five million oz of silver equivalent per year. The company is seeking accretive growth opportunities in Bolivia and the Americas. Andean is committed to fostering safe, sustainable and responsible operations.

We seek Safe Harbor.