Mr. Arturo Prestamo reports

SANTACRUZ SILVER REPORTS FOURTH QUARTER AND YEAR END 2023 FINANCIAL RESULTS

Santacruz Silver Mining Ltd. has released its financial and operating results for the fourth quarter (Q4) and year-end 2023. The full version of the financial statements and accompanying management's discussion and analysis (the MD&A) can be viewed on the company's website or on SEDAR+.

2023 highlights

• Processed 1,883,446 tonnes of material, a 14-per-cent increase year over year;
• Produced of 22,641,052 silver equivalent ounces, a 25-per-cent increase year over year, including:
  • 7,004,582 ounces of silver, a 25-per-cent increase year over year;
  • 91,616 tonnes of zinc, a 26-per-cent increase year over year;
  • 12,369 tonnes of lead, a 23-per-cent increase year over year;
  • 1,254 tonnes of copper, a 3-per-cent decrease year over year.
• Cash cost per silver equivalent ounce sold of $18.96, an 8-per-cent increase year over year;
• AISC (all-in sustaining costs) per silver equivalent ounce sold of $22.69, a 13-per-cent increase year over year;
• Revenue of $251,256,000, a 10-per-cent decrease year over year;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $50,980,000, a 237-per-cent increase year over year.

Arturo Prestamo, executive chairman and interim chief executive officer of Santacruz, commented: "In 2023, Santacruz continued to build a mid-tier silver and base metals producer. The company completed several mine optimization initiatives including the integration ramp that connects the Tres Amigos and Colquechaquita underground mines at Caballo Blanco in Bolivia. And in Mexico, the operational restructuring at the Zimapan mine has already resulted in cost savings."

Mr. Prestamo continued: "The company has also made significant progress on improving its financial position, and recently announced amended terms of sale with Glencore for the Bolivian assets. This is expected to further strengthen our balance sheet by significantly reducing the value of the consideration payable that will be recorded on our balance sheet, which will be reflected in the next quarterly financial results."

Selected consolidated financial and operating information for the year ended 2023, 2022 and 2021 are presented herein. All financial information is prepared in accordance with international financial reporting standards (IFRS), and all dollar amounts are expressed in thousands of United States dollars, except per-unit amounts, unless otherwise indicated.

Silver equivalent ounces produced

2023 versus 2022

YTD 2022, 1,646,272 tonnes of material was processed, and 18,112,725 silver equivalent ounces was produced, and in YTD 2023 1,883,446 tonnes of material was produced and 22,641,052 silver equivalent ounces was produced. While total material processed in 2023 was 14 per cent more compared with YTD 2022, total silver equivalent ounce production was up 25 per cent. Annual 2023 production results benefitted from a full Q1 2023 production from the Bolivian operations. Annual 2022 figures are affected by the partial quarter of Bolivian production in Q1 2022. On March 18, 2022, the company closed the acquisition of the Bolivian assets from Glencore and the results of the operations of the Bolivian assets are included from that date.

Q4 2023 versus Q3 2023

Santacruz processed 489,417 tonnes of material in Q4 2023, a 5-per-cent increase from the previous quarter. Silver equivalent ounce production increased 2 per cent to 5,757,229 including 1,719,738 ounces of silver, 23,777 tonnes of zinc, 3,130 tonnes of lead and 290 tonnes of copper. While average throughputs, head grades and recoveries varied slightly across all operations, the increase in material processed at Zimapan, and increases in mineralized material purchased by San Lucas drove consistent metal production quarter on quarter.

Cash cost of production per tonne

2023 versus 2022

Consolidated cash cost of production per tonne of mineralized material processed was $93.10 in YTD 2023 compared with $117.99 in YTD 2022. Significant decreases in unit production costs at the Bolivian operations, a result of higher production rates and cost-saving initiatives have driven the consolidated net reduction in cash costs of 21 per cent per tonne.

Q4 2023 versus Q3 2023

Consolidated cash cost of production per tonne of mineralized material processed remained stable with a slight increased of 1 per cent. Cash cost per tonne at San Lucas decreased 24 per cent, which was offset by the 15-per-cent increase at all other Bolivian operations. In Mexico, cost of sales remained stable for the quarter as full production resumed at Zimapan after recovering from a two-week haulage stoppage that took place during Q3 2023.

Cash cost per silver equivalent ounce sold

2023 versus 2022

Cash cost per silver equivalent ounce sold was $18.96 in 2023 compared with $17.58 in 2022. This 8-per-cent increase in cash cost was due primarily to a 18-per-cent decrease in silver equivalent ounces sold, partly offset by a 5-per-cent decrease in unit operating costs. While the metal production increased 25 per cent for the same period, silver equivalent ounces sold decreased by 18 per cent mainly due to Bolivia's preacquisition inventories sold in Q2 and Q3 2022 which accounted for approximately 80 per cent of the total decrease in silver equivalent ounces sold. The other 20 per cent of the total decrease in silver equivalent ounces sold can be attributed to the silver equivalent conversion ratio of base metals to silver, which was higher due to the changes in realized metal prices and resulted in the additional reduction of silver equivalent ounces sold.

Q4 2023 versus Q3 2023

Consolidated results for Q4 2023 show an 18-per-cent decrease in cash costs per silver equivalent ounce sold compared with Q3 2023. This decrease is primarily a result of lower unit operating costs for San Lucas and Zimapan, and higher sales from the company's Bolivian mining operations. At Zimapan, the lower unit costs are a result of the operational restructuring that began in Q3 2023. Consolidated silver equivalent ounces sold held steady quarter on quarter.

All-in sustaining cash cost (AISC) per silver equivalent ounce sold

2023 versus 2022

Two thousand twenty-three AISC per silver equivalent ounce sold was $22.69, compared with 2022 of $20.05. This 13-per-cent increase in unit cost was due primarily to the 18-per-cent decrease in silver equivalent ounces sold (most of which was not production related and due to Bolivia's preacquisition inventories sold in Q2 and Q3 2022), higher sustaining general and administrative expenses, and higher capital expenditures primarily related to the integration ramp at Caballo Blanco, which was a significant capital expenditure during 2023 (and was completed in January, 2024), but partly offset by 5-per-cent lower unit operating costs. An 18-per-cent decrease in silver equivalents sold which is a function of realized metal prices.

Q4 2023 versus Q3 2023

Consolidated AISC per silver equivalent ounce sold decreased 18 per cent quarter on quarter to $21.37, mainly a result of lower unit operating costs, partly offset by higher sustaining general and administrative expenses and higher capital expenditures mostly related to the integration ramp at Caballo Blanco.

About Santacruz Silver Mining Ltd.

Santacruz Silver is engaged in the operation, acquisition, exploration and development of mineral properties in Latin America. The Bolivian operations comprise the Bolivar, Porco and the Caballo Blanco group, which consists of the Tres Amigos, Reserva and Colquechaquita mines. The Soracaya exploration project and San Lucas ore sourcing and trading business are also in Bolivia. The Zimapan mine is in Mexico.

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