Silvercorp Metals (TSX:SVM, NYSEMKT:SVM) reported its financial and operating results for the first quarter endedJune 30, 2017. All amounts are expressed in US Dollars.

FIRST QUARTER HIGHLIGHTS

  • Net income attributable to equity shareholders of$10.9 million, or$0.07per share1, up 134% compared to net income attributable to equity shareholders of$4.7 million, or$0.03per share in the prior year quarter;
  • Sales of$39.7 million, up 13% compared to$35.3 millionin the prior year quarter;
  • Gross margin of 50% compared with 45% in the prior year quarter;
  • Cash flow from operations of$16.9 million, compared to$20.2 millionin the prior year quarter;
  • Dividend of$1.7 million, or$0.01per share, paid to the equity shareholders;
  • Ended the quarter with$102.1 millionin cash and cash equivalents and short-term investments, an increase of$5.6 millionor 6% compared to$96.5 millionas atMarch 31, 2017;
  • Silver, lead, and zinc metals sold amounted to approximately 1.5 million ounces silver, 15.9 million pounds lead, and 5.0 million pounds zinc, down 8%, 5%, and 4%, respectively from the prior year quarter;
  • Head grades were 304 grams per ton (g/t) for silver, 4.6% for lead, and 0.8% for zinc at the Ying Mining District, compared to 308 g/t for silver, 4.4% for lead and 1.1% for zinc in the prior year quarter;
  • Total and cash mining costs per tonne ore2of$68.12and$50.29, respectively, compared to$68.70and$47.24in the prior year quarter;
  • Cash cost per ounce of silver2, net of by-product credits, of negative$3.57, compared to positive$0.08in the prior year quarter;
  • All-in sustaining cost per ounce of silver2, net of by-product credits, of$4.70, compared to$7.06in the prior year quarter; and,
  • Realized a gain of$4.3 millionon the disposal of the Company’s 2.5% net smelter return (NSR) in the Silvertip mine.

_______________________________

1

Earnings per share refers to basic earnings per share

2

Non IFRS measure, please refer to section 10 of the corresponding MD&A for reconciliation

FINANCIALS

Net income attributable to equity shareholders of the Companyin Q1 Fiscal 2018 was$10.9 million, or$0.07per share, compared to$4.7 million, or$0.03per share in Q1 Fiscal 2017.

The Company’s financial results in Q1 Fiscal 2018 were mainly impacted by the following: i) the increase of metal prices, as the realized selling price for silver, lead, and zinc increased by 5%, 35%, and 65%, compared to the prior year quarter; ii) a$4.3 milliongain on disposal of Silvertip Mine’s NSR; offset by i) a$1.6 millionforeign exchange loss, ii) less metals sold, and iii) a 3% increase in per tonne cash production costs.

Salesin Q1 Fiscal 2018 were$39.7 million, up 13% compared to$35.3 millionin the same quarter last year. Silver and gold sales represented$20.2 millionand$1.0 million, respectively, while base metals represented$18.5 millionof total sales compared to silver, gold and base metals sales of$20.8 million,$0.9 million, and$13.6 million, respectively, in the prior year quarter.

Cost of salesin Q1 Fiscal 2018 was$19.7 millioncompared to$19.5 millionin Q1 Fiscal 2017. The cost of sales included$14.1 million(Q1 Fiscal 2017 $14.2 million) production costs,$1.1 millionmineral resources tax (Q1 Fiscal 2017 $0.4 million), and$4.5 million(Q1 Fiscal 2017 $5.0 million) depreciation and amortization charges. The increase of mineral resources tax was mainly because the mineral resources tax was levied based on a certain percentage of sales in the current quarter while it was levied based on the tonnage of ore milled in the prior year quarter. The decrease of depreciation and amortization