Aurcana Silver Corp V.AUN.H

further Q3 extracts

[M1DAS]

The decrease in earnings from La Negra mining operations for the quarter ended September 30, 2012 as well as for the nine months ended September 30, 2012 was mainly related to lower metal prices offsetting increased volumes.

The Company is currently reviewing its options with respect to hedging. Currently the Company is able to fix prices on a monthly basis with its concentrate buyer.

Revenues have been increasing mainly as a result of higher metal content of the concentrate and since the second quarter of 2012 due to the Company’s expansion of its mill installed capacity from 1,500 tonnes to 2,500 tonnes per day. Partially offsetting these increases was a decline in metal prices. At September 30, 2012 the Company had working capital of $10.5 million (Dec 2011 –$33.7 million), which
consisted of $13.5 million held in cash and short term deposits; account receivables of $6.6 million (trade & others); inventory of $4.3 million; Short-term investment of $0.8; amount receivables $0.5; and prepaid
expenses of $0.9 million. These amounts are offset by accounts payable of $13.2 million; and the current portion of the Company’s notes payable of $2.9 million in relation to equipment purchases at the La Negra and Shafter Silver Mine.