Mr. Michael Curlook reports

MAG SILVER REPORTS 2023 ANNUAL FINANCIAL RESULTS

Mag Silver Corp. has released the company's consolidated financial results for the year ended Dec. 31, 2023. For details of the audited consolidated financial statements of the company for the year ended Dec. 31, 2023, and management's discussion and analysis for the year ended Dec. 31, 2023, please see the company's filings on the System for Electronic Document Analysis and Retrieval Plus (SEDAR+) or on the Electronic Data Gathering, Analysis, and Retrieval (EDGAR).

All amounts herein are reported in thousands of United States dollars unless otherwise specified.

Key highlights (on a 100-per-cent basis unless otherwise noted):

• Mag reported net income of $48,659 (47 cents per share) driven by income from Juanicipio (equity accounted) of $65,099 and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $97,480 for the year ended Dec. 31, 2023.
• Mag reported net income of $15,694 (15 cents per share) driven by income from Juanicipio (equity accounted) of $21,069 and adjusted EBITDA of $29,787 for the three months ended Dec. 31, 2023.
• A total of 346,766 tonnes of mineralized material at a silver head grade of 467 grams per tonne were processed at Juanicipio during the fourth quarter. Milling performance for 2023 totalled 1,268,757 tonnes at a head grade of 472 g/t.
• Juanicipio achieved silver production of 4.5 million ounces during the fourth quarter. Silver production for 2023 totalled 16.8 million ounces.
• Juanicipio continued to capitalize on available milling capacity at the Saucito plant (100 per cent Fresnillo owned) to maintain processing rates during periods of maintenance. Approximately 5 per cent of the material processed during the fourth quarter was processed through the Saucito plant.
• Juanicipio delivered robust cost performance with cash cost of $3.76 per silver ounce sold and all-in sustaining cost of $9.17 per silver ounce sold in the fourth quarter.
• Juanicipio generated strong operating cash flow of $84,038 and free cash flow of $61,993 in the fourth quarter. Operating cash flow and free cash flow for 2023 totalled $145,064 and $60,814, respectively.
• At the end of the year, Juanicipio held cash balances of $42,913, representing an increase of $41,811 over 2022, driven by strong operating cash flows.
• Juanicipio returned a total of $18,765 in interest and loan principal repayments to Mag during the fourth quarter. Interest and loan principal repayments returned to Mag during 2023 totalled $33,354.
• Mag concluded a $40,000 senior secured revolving credit facility with the Bank of Montreal on Oct. 4, 2023.
• Effective June 20, 2023, Mag was included in the NYSE Arca Gold Miners Index which is tracked by the VanEck Vectors Gold Miners ETF.

Corporate:

• In September, the company published its second annual sustainability report, underscoring its commitment to transparency with its stakeholders while providing a comprehensive overview of the Company's environmental, social and governance (ESG) commitments, practices and performance for the 2022 year. The 2022 sustainability report is supported by the Mag Silver 2022 ESG data table which discloses Mag's historical ESG performance data.
• During early 2024, as part of the company's longer-term succession planning, Dr. Lex Lambeck was promoted to the position of vice-president, exploration. Dr. Lambeck has been the project manager for the Deer Trail project in Utah since it was acquired by Mag in 2019, led by Dr. Peter Megaw. Dr. Lambeck's leadership was instrumental in the application of the hub-and-spoke thesis at Deer Trail as well as the Carissa discovery, demonstrating his strong skills in generative exploration in district-scale settings which will be invaluable in overseeing the company's portfolio of exploration properties, including exploration at Juanicipio.
• Marc Turcotte, with his almost 10 years experience at Mag as vice-president, corporate development, was promoted to the position of chief development officer. In this broader executive role, Mr. Turcotte will leverage his proven record in identifying unique situations to zero in on and assess inorganic growth opportunities aligned with the company's commitment to continued Tier 1 growth and expansion. Mr. Turcotte was the architect of the consolidation of the Deer Trail project in Utah as well as the catalyst behind the acquisition of Gatling Exploration which brought the Larder project into Mag's portfolio of high-quality, high-impact exploration properties.
• Tom Peregoodoff was appointed to the board of directors of Mag effective Jan. 1, 2024. Mr. Peregoodoff will fill the vacancy to be created by the planned retirement in June, 2024, of Dan MacInnis, who does not plan to seek re-election at the company's 2024 annual general meeting of shareholders. Mr. Peregoodoff brings with him over 30 years of industry knowledge and leadership and has extensive experience in all aspects and stages of the global mining business, specializing in mineral exploration.

Exploration:

• Juanicipio:
  • Infill drilling at Juanicipio continued in 2023, with one rig on surface and one underground with the goal of upgrading and expanding the Valdecanas vein system at depth and further defining areas to be mined in the near to midterm. During 2023, 13,273 metres (three months ended Dec. 31, 2023: nil metres) and 22,015 metres (three months ended Dec. 31, 2023: 6,686 metres) were drilled from surface and underground respectively. Drilling for the year, both surface and underground, was infill in nature and continues to confirm defined mineralization.
• Deer Trail project, Utah:
  • Results from the 12,157 metres in surface-based phase 2 drilling on the Deer Trail carbonate replacement deposit project were reported on Jan. 17, 2023, and Aug. 3, 2023 (see news releases dated Jan. 17, 2023, and Aug. 3, 2023, available under the company's SEDAR+ profile);
  • On May 29, 2023, Mag started a phase 3 drilling program focused on up to three porphyry hub targets thought to be the source of the manto, skarn and epithermal mineralization and extensive alteration throughout the project area, including that at the Deer Trail and Carissa zones. An early onset of winter snowfall impacted the commencement of the third porphyry hub target, which is expected to be drilled next season, and drilling has shifted to offset the Carissa discovery and test other high-potential targets;
  • During 2023, 5,525 metres (three months ended Dec. 31, 2023: 1,609 metres) were drilled at high elevation with final results and interpretation pending.
• Larder project, Ontario:
  • On July 12, 2023, drilling resumed at the Larder project to test additional targets by the end of the year on the Cheminis and Bear areas. During 2023, 17,504 metres were drilled at Swansea, Cheminis and Bear;
  • Cheminis success: The magnetotellurics survey carried out in the summer of 2023 enabled modelling of the south volcanic gold zone at Cheminis and is proving to be applicable elsewhere across the property. Drilling in three successive Cheminis drill holes (GAT-23-019, 020A and 021B) intersected grades of 1.1 to 20.3 g/t gold over core lengths of 0.6 to 11.1 metres demonstrating continuity. This also extended the gold-hosting mine sequence down to 700 metres below surface, more than 370 metres below the deepest workings in this portion of the Cadillac-Larder break. Incorporating these results into the model should enhance predictability in follow-up drilling;
  • Bear success: Increased predictability has led to continued success and further definition of the North Bear zone, especially in hole GAT-23-022NA, which cut 5.1 metres grading 4.6 g/t gold (including a high-grade zone of 1.4 metre grading 16.2 g/t gold). These intercepts extend gold mineralization to 650 metres below surface, and it remains open in all directions.

Juanicipio results

All results of Juanicipio in this section are on a 100-per-cent basis, unless otherwise noted.

Operating performance

During the year ended Dec. 31, 2023, a total of 1,097,289 tonnes of mineralized material were mined. This represents an increase of 38 per cent over 2022. Increases in mined tonnages at Juanicipio have been driven by the operational ramp-up of the milling facility.

During the year ended Dec. 31, 2023, a total of 1,268,757 tonnes of mineralized material were processed through the Juanicipio, Saucito and Fresnillo plants. This represents an increase of 96 per cent over 2022. The increase in milled tonnage has been driven by the Juanicipio mill commissioning and operational ramp-up. As reported by the operator, Fresnillo PLC, the Juanicipio processing facility achieved nameplate capacity of 4,000 tonnes per day during September, 2023, with silver recovery consistently above 88 per cent. Juanicipio continued to capitalize on available milling capacity at the Saucito plant (100 per cent Fresnillo owned) to maintain processing rates during periods of maintenance. Approximately 5 per cent of the material processed during the fourth quarter of 2023 was processed through the Saucito plant.

The average silver head grade for the mineralized material processed in the year ended Dec. 31, 2023, was 472 g/t (year ended Dec. 31, 2022: 520 g/t).

Financial results

Sales increased by $226,552 during the year ended Dec. 31, 2023, mainly due to 84-per-cent-higher metal volumes and 5-per-cent-higher realized metal prices.

Offsetting higher sales was higher depreciation ($47,561) as the Juanicipio mill achieved commercial production and commenced depreciating the processing facility and associated equipment, and higher production cost ($109,845), which was driven by higher sales and operational ramp-up in mining and processing, including $44,027 in inventory movements as commissioning stockpiles were drawn down.

Other expenses increased by $28,932 mainly as a result of higher extraordinary mining and other duties ($4,596) related to higher precious metal revenues from the sale of concentrates, higher consulting and administrative expenses ($10,332) as an operator services agreement became effective upon initiation of commercial production whereby Fresnillo and its affiliates continue to operate the mine, and higher interest incurred on shareholder loans ($16,227), which were completely expensed during 2023, whereas being only partly expensed with the rest capitalized to construction in progress during 2022.

Taxes increased by $1,033 impacted by deferred tax charges associated with fixed assets as well as higher taxable profits generated during the period.

Sales and treatment charges are recorded on a provisional basis and are adjusted based on final assay and pricing adjustments in accordance with the offtake contracts.

Mag financial results -- year ended Dec. 31, 2023

As at Dec. 31, 2023, Mag had working capital of $67,262 (Dec. 31, 2022: $29,232), including cash of $68,707 (Dec. 31, 2022: $29,955), and no long-term debt. As well, as at Dec. 31, 2023, Juanicipio had working capital of $86,336, including cash of $42,913 (Mag's attributable share is 44 per cent).

The company's net income for the year ended Dec. 31, 2023, amounted to $48,659 (Dec. 31, 2022: $17,644) or 47 cents/share (Dec. 31, 2022: 18 cents/share). Mag recorded its 44-per-cent income from equity accounted investment in Juanicipio of $65,099 (Dec. 31, 2022: $40,767) which included Mag's 44-per-cent share of net income from operations as well as loan interest earned on loans advanced to Juanicipio (see above for Mag's share of income from its equity accounted investment in Juanicipio).

Qualified persons: All scientific or technical information in this press release including assay results referred to, and mineral resource estimates, if applicable, is based upon information prepared by or under the supervision of, or has been approved by, Dr. Peter Megaw, PhD, CPG, Mag's chief exploration officer, and Gary Methven, PEng, vice-president, technical services; both are qualified persons for purposes of National Instrument 43-101 Standards of Disclosure for Mineral Projects.

About Mag Silver Corp.

Mag Silver is a growth-oriented Canadian exploration company focused on advancing high-grade, district-scale precious metals projects in the Americas. Mag is emerging as a top-tier primary silver mining company through its (44-per-cent) joint venture interest in the 4,000-tonne-per-day Juanicipio mine, operated by Fresnillo (56 per cent). The mine is located in the Fresnillo silver trend in Mexico, the world's premier silver mining camp, where in addition to underground mine production and processing of high-grade mineralized material, an expanded exploration program is in place targeting multiple highly prospective targets. Mag is also executing multiphase exploration programs at the 100-per-cent earn-in Deer Trail project in Utah and the 100-per-cent-owned Larder project, located in the historically prolific Abitibi region of Canada.

We seek Safe Harbor.