Discovery Reports Q4 2020 Financial Results and update
TORONTO, April 29, 2021 (GLOBE NEWSWIRE) -- Discovery Silver Corp. (TSX-V: DSV, OTCQX: DSVSF) (“Discovery” or the “Company”) is pleased to announce its financial results for the three months and twelve months ended December 31, 2020, and to provide a summary of key events for the quarter and subsequent to year-end. All amounts are presented in Canadian dollars (“C$”) unless otherwise stated.
Discovery’s flagship project is our 100%-owned Cordero project (“Cordero” or the “Project”) located in Chihuahua State, Mexico. We are aggressively advancing the Project through a 66,000 metre (“m”) drill program in 2021 focused on delineating a high-margin silver project with size and scaleability.
HIGHLIGHTS FROM Q4 2020 & SUBSEQUENT EVENTS:
Financial & Corporate:
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As at December 31, 2020, we had a cash and cash equivalents and short term investment balance of $82.5 million.
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In February we announced that an aggregate of 31,140,000 common share purchase warrants with an exercise price of $1.00 were exercised prior to their expiry on February 17, 2021. The exercises resulted in gross proceeds of approximately $31 million, of which approximately $17.6 million was received in 2021.
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The Company’s cash position as of the date of this release is approximately $94 million.
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On March 12, 2021, we announced the appointment of Jennifer Wagner to the Company’s Board of Directors. Ms. Wagner is a corporate securities lawyer and has extensive experience advising companies on a variety of corporate commercial transactions, governance, and compliance matters. She currently serves as Executive Vice-President, Corporate Affairs and Sustainability at Kirkland Lake Gold Ltd.
Exploration:
At Cordero, we have now completed 72,200 m (174 holes) as part of our expanded Phase 1 drill program that is scheduled to conclude at the end of this month. Data from Phase 1 drilling will be used to support the bulk-tonnage resource update and preliminary economic assessment (“PEA”) scheduled for the second half of the year.
The four drill rigs currently operating on site will continue uninterrupted with Phase 2 drilling. Phase 2 drilling will be focused on reserve definition, resource expansion, and high-grade vein delineation.
Bulk-tonnage targets
Our recent drilling has expanded the higher-grade bulk-tonnage domain by more than 250 m northeast, along strike in the South Corridor. This domain has now been defined over a strike length of approximately 1.4 km and is open to the northeast and has been drilled to a depth of 500 m and remains open below this. Higher-grade zones of mineralization are typically flanked by medium and lower-grade mineralization pointing to the scaleability of the mineralized system at Cordero.
Select drill highlights during Q4 2020 and subsequent to quarter-end from our bulk-tonnage targets include:
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128.2 m averaging 165 g/t AgEq from 312.4 m (65 g/t Ag, 0.05 g/t Au, 1.2% Pb and 1.3% Zn) including 26.1 m averaging 263 g/t AgEq1 (109 g/t Ag, 0.06 g/t Au, 2.0% Pb, 1.9% Zn) in hole C20-405
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139.1 m averaging 138 g/t AgEq from 196.2 m (47 g/t Ag, 0.07 g/t Au, 0.6% Pb and 1.6% Zn)
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131.6 m averaging 118 g/t AgEq from 49.2 m (48 g/t Ag, 0.09 g/t Au, 0.5% Pb and 1.1% Zn) including 37.1 m averaging 223 g/t AgEq (119 g/t Ag, 0.22 g/t Au, 1.0% Pb, 1.2% Zn) in hole C20-375
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110.0 m averaging 110 g/t AgEq from 137.1 m (37 g/t Ag, 0.04 g/t Au, 0.8% Pb and 1.0% Zn) and 51.8 m averaging 184 g/t AgEq (65 g/t Ag, 0.05 g/t Au, 1.6% Pb, 1.4% Zn) in hole C21-414
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85.6 m averaging 175 g/t AgEq from 406.2 m (53 g/t Ag, 0.05 g/t Au, 1.4% Pb and 1.7% Zn) including 39.9 m averaging 308 g/t AgEq (93 g/t Ag, 0.08 g/t Au, 2.4% Pb, 3.0% Zn) in hole C20-378
High-grade vein targets
We continue to demonstrate the excellent potential of the high-grade vein systems that transect the deposit. At Josefina we have consistently intercepted bonanza grades along 1.5km of strike extent. At the 1.5km Todos Santos vein trend 20 holes have now been drilled. All 20 holes have intercepted the principal vein returning an average drilled width of 2.6m grading 635 g/t AgEq1. Recent step out holes at the Parcionera vein trend have doubled the drill-confirmed strike extent to at least 1 km with clear potential for further expansion to the northeast.
Select drill highlights from these veins during Q4 2020 and subsequent to quarter end include:
Josefina Vein
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1.3 m averaging 2,166 g/t AgEq from 95.6 m (1,581 g/t Ag, 0.15 g/t Au, 9.9% Pb and 5.4% Zn) in hole C20-381
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1.0 m averaging 1,826 g/t AgEq from 41.2 m (1,280 g/t Ag, 4.24 g/t Au, 1.6% Pb and 3.4% Zn) within an 8.9 m interval averaging 410 g/t AgEq1 (267 g/t Ag, 0.91 g/t Au, 0.9% Pb, 0.8% Zn) in hole C20-382
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1.3 m averaging 2,290 g/t AgEq from 136.7 m (1,607 g/t Ag, 2.06 g/t Au, 5.2% Pb and 8.0% Zn) in hole C20-396
Todos Santos Vein
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3.4 m averaging 1,150 g/t AgEq from 145.6 m (412 g/t Ag, 0.42 g/t Au, 8.0% Pb and 10.0% Zn) in hole C20-349
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2.0 m averaging 1,207 g/t AgEq from 224.8 m (532 g/t Ag, 0.38 g/t Au, 8.8% Pb and 8.1% Zn) in hole C20-351
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1.4 m averaging 1,107 g/t AgEq from 135.4 m (552 g/t Ag, 0.33 g/t Au, 11.0% Pb and 3.4% Zn) within a 4.0 m interval averaging 763 g/t AgEq (377 g/t Ag, 0.28 g/t Au, 7.1% Pb, 2.7% Zn) in hole C20-385
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1.0 m averaging 1,729 g/t AgEq from 380.1 m (433 g/t Ag, 0.23 g/t Au, 9.3% Pb and 22.9% Zn) in hole C20-354
Parcionera Vein
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4.4 m averaging 524 g/t AgEq from 53.9 m (246 g/t Ag, 0.39 g/t Au, 6.5% Pb and 0.4% Zn) within a 37.1 m interval averaging 113 g/t AgEq (47 g/t Ag, 0.09 g/t Au, 1.1% Pb, 0.4% Zn) in hole C20-362
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0.5 m averaging 1,765 g/t AgEq from 100.9 m (665 g/t Ag, 0.58 g/t Au, 13.8% Pb and 13.7% Zn) in hole C20-360
For the drill results noted above, refer to news releases dated November 14 and October 12, 2020, and January 6, February 2, March 15 and April 20, 2021, for further details.
COVID-19 UPDATE:
The Company continues to be proactive regarding COVID-19 and continually monitors employees and contractors and remains committed to being engaged with our local stakeholders during this uncertain period. The Company will continue to closely monitor the directives of all levels of government in both Mexico and Canada as well as the relevant health authorities.
LOOKING AHEAD:
Our Phase 1 drill program began in September 2019 and will conclude at the end of April 2021. In total we have drilled more than 70,000 m, delivering exceptional results that demonstrate the excellent high-grade potential that exists within the enormous mineralized footprint at Cordero. Over the coming months we will be busy compiling this drill data alongside our updated geological and structural models to produce a brand-new resource estimate in 3Q 2021. This resource model, along with the results from our detailed metallurgical testwork program that is ongoing, will form the basis for a revamped PEA to be completed in 4Q 2021. Our objective with the PEA is to deliver a technically robust study demonstrating that Cordero is one of the few deposits in the silver space that offers the combination of margin, size and scaleability.
While we are working on these major de-risking milestones we will remain focused on continuing to add value through our Phase 2 drill program. Our Phase 2 program will immediately follow our Phase 1 program with the four drill rigs currently operating on site continuing uninterrupted. Phase 2 drilling will be focused on three key areas: (1) upgrading inferred resources to indicated for inclusion in a prefeasibility study on Cordero; (2) resource expansion of bulk-tonnage mineralization; and (3) testing of the width, grade and continuity of extensive high-grade vein systems that transect the deposit. Additionally, socio-economic and environmental baseline studies are currently underway and will continue through the year.
SELECTED FINANCIAL DATA:
The following selected financial data is summarized from the Company’s audited consolidated financial statements and related notes thereto (the “Financial Statements”) for the year ended December 31, 2020. A copy of the Financial Statements and MD&A is available on our website at www.discoverysilver.com or on SEDAR at www.sedar.com.
| Net loss | | Q4 2020 | | | Q4 2019 | | | Q4 YTD 2020 | | | Q4 YTD 2019 | |
| (a) Total | $ | (6,125,457 | ) | $ | (4,178,391 | ) | $ | (17,755,694 | ) | $ | (9,656,554 | ) |
| (b) basic and diluted per share | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.07 | ) | $ | (0.08 | ) |
| Net loss & total comprehensive loss | $ | (5,455,362 | ) | $ | (3,959,211 | ) | $ | (18,064,675 | ) | $ | (9,595,837 | ) |
| Total weighted average shares outstanding | | 302,368,222 | | | 193,526,170 | | | 255,839,116 | | | 114,752,935 | |
| | | December 31, 2020 | | | December 31, 2019 | |
| Cash, cash equivalents & short-term investments | $ | 82,547,897 | | $ | 23,950,737 | |
| Total assets | $ | 111,564,881 | | $ | 53,518,599 | |
| Total current liabilities | $ | 982,260 | | $ | 716,596 | |
| Total liabilities | $ | 1,023,349 | | $ | 804,466 | |
| Working capital | $ | 82,435,046 | | $ | 23,860,648 | |
| Total Shareholders’ equity | $ | 110,541,532 | | $ | 52,714,133 | |
About Discovery
Discovery’s flagship project is its 100%-owned Cordero project, one of the few silver projects globally that offers margin, size and scaleability. The project is located in a prolific mining belt in Chihuahua State, Mexico, and is supported by an industry leading balance sheet with over C$90 million of cash allocated for aggressive exploration, resource expansion and future development. Discovery was a recipient of the 2020 TSX Venture 50 award and the 2021 OTCQX Best 50 award.
On Behalf of the Board of Directors,
Taj Singh, M.Eng, P.Eng, CPA,
President, Chief Executive Officer and Director
.....Bluetick