Guanajuato Silver Company Ltd GSVRF

Don’t Be A Nervous Nellie

[ErinBrockovich]

@lexconPeople can scoff at the improvements the company has made " Whether these "investments" will transpire into costs reduction and positive cashflow remains to be seen. So far, recent financial results does not reflect that." But when you take the time to read through the MD&A it is very apparent where the improvements will come from, and they should have significant impact. Lets look at the current mix of production over the three plants as of end of 1Q They break it down and the current contribution per quarter is CMC = 315,587 VMC = 297,769 (based on 20k tonne rate) Topia = 324,691 The VMC production rate was 20k tonne per quarter in the first quarter, but the improvements (described further below and not in effect until 2Q ) will increase the VMC rate to 36k tonne/qtr or an increase of an added 75% of the current production from VMC (currently the least cost complex) But whats the big deal? so they increase total production how does that improve cost? well, they increase the production from the lowest cost center... So, part of 2023 production increase is continued ramp up of Cata mill at VMC by another 75% of the current rate. VMC currently did 297,769 in current quarter, by end of year if they hit target it would be close to 521,096 oz eq. on a qtrly basis. If Topia and CMC remain level then total quarterly production would be higher percentage from VMC CMC 315,587 27.2% VMC 521,096 44.9% Topia 324,691 27.9% And since VMC currently is significantly lower cash cost and AISC than the other two plants, and the productivity improvements described on page 21 of the MDA will further improve those costs, then by having the lowest cost production center ramp up to close to half of the production output will lower the company wide total cash cost and AISC during the rest of 2023. but what and how will they achieve these lofty goals they set at VMC? They explain that in the MDA as well Beside the increased RATE of production from the adit lift, they are improving recovery rate with the concentrator. Improving recovery rates of the metals by 3% is significant improvement in recovery, and even more so when you consider that they are going to get that improvement on the already lowest cost production center they operate. Higher total production company wide in 2023 and continuing reduction in cash cost and AISC (primarily by increasing the amount of production from an already lowest cost mine/mill) seems to be in store.

[ErinBrockovich]

If you don't already. Be sure to follow CEO boards @lexcon. He is very knowledgeable about GSVR.