IMPACT Silver Corp. (“IMPACT” or the “Company”) announces its financial and operating results for the second quarter ended June 30, 2024.

Overall revenue in Q2 2024 was $7.7 million, representing a significant 40% increase over Q2 2023 revenue of $5.5 million. Revenue in Q2 2024 includes $1.8 million from the Plomosas high-grade zinc mine up from $1.0 million in Q1 2024. The Plomosas high-grade zinc mine (acquired in April 2023) was brought online in late 2023 and therefore, year-over-year comparisons do not include any revenue or operating costs recorded in Q2 2023. Meanwhile, revenue at the Zacualpan silver-lead-zinc project increased to $5.9 million in Q2 2024 from $5.4 in Q2 2023 despite lower production on a year-over-year basis, owing mostly to stronger silver prices.

The mine operating loss (before amortization and depletion) in Q2 2024 was $0.2 million compared to income of $0.9 million Q2 2023 which did not include any start-up and operating costs from Plomosas. The Company continued to experience cost pressures at its mine sites, certain one-time costs associated with bringing the Plomosas mine online, and the negative effects of a strong Mexican Peso. The net loss in Q2 2024 was $2.6 million compared to a net loss of $0.9 million in Q2 2023.

Q2 2024 Consolidated Financial Overview

Revenue in Q2 2024 was $7.7 million, up from $5.5 million in Q2 2023.
Mine operating loss before amortization and depletion[1] in Q2 2024 was $0.22 million, compared to income of $0.9 million in Q2 2023.
The net loss in Q2 2024 was $2.6 million after foreign exchange expense and deferred income taxes totalling $0.6 million compared to net loss of $0.9 million in Q2 2023.
After investing $1.6 million in exploration expenditures and mining assets during the quarter, the cash position remained strong at quarter-end with $9.9 million and working capital of $8.8 million.
During the quarter, the Company closed a non-brokered “LIFE” and private placement of $8.6 million.
The Company has no long-term debt.
Q2 2024 Zacualpan Mine Production Overview

Mill throughput in Q2 2024 was 35,062 tonnes compared to 35,753 tonnes in Q2 2023.
Silver production during the period decreased by 2% to 152,152 oz compared to 155,744 oz in Q2 2023 while lead and gold production decreased on a year-over-year basis by 36% and 69%, respectively.
Revenue per tonne sold was $168.17 in Q2 2024, representing an increase of 8% compared to $155.67 in the same period of 2023.
Direct costs per production tonne were $153.26 in Q2 2024, representing an increase of 17% over Q2 2023 costs of $130.67 per tonne. Much of this increase is due to foreign exchange, a retroactive union labour settlement including associated bonuses, with the balance coming from inflation-related pressures in Mexico. On a Mexican Peso basis, costs for the first six months of 2024 were the same as the first six months of 2023.
Zacualpan Silver District Review

The Company’s overall average mill head grade of 161 g/t during the period was down 1% year-over-year from 163 g/t in Q2 2023. Gold production during the period was temporarily reduced compared to the same period in 2023 as the Company adjusted mining efficiencies and improved recoveries from its gold-rich Alacran mine. The Company is continuing to focus on exploration and development of the mining district in Q2 2024, having drilled 5,243 meters over the last six months.

Stronger metal prices on a year-over-year basis are due to increased confidence of pending looser monetary policy in 2024 as well as geopolitical uncertainties emanating from Eastern Europe and the Middle East. A flight to safety has increased the flow of funds into commodities in general, and the mining sector in particular as investors seek protection from ongoing inflationary pressures. Notwithstanding, ongoing cost inflation continues to impact costs throughout the supply chain and labour network, despite a softening of these trends since late 2023. Moreover, the overall negative effect of a strong Mexican Peso continues to hamper the Company’s profit margins. The rate of cost increases at Zacualpan may start to subside further in 2H 2024 as new labour contracts have provided some cost certainty while the Company works to improve throughput grade.

Q2 2024 Plomosas Mine Production Overview

The Plomosas high-grade zinc mine (acquired in April 2023) was brought online in late 2023 and production continues to ramp up
Mill throughput in Q2 2024 was 9,256 tonnes, up 157% from 3,594 tonnes in Q1 2024.
Since the start of 2024, the average zinc grade was 14%, lead was 8.7% and silver was 43.7 g/t.
Over the last six months, the Company drilled 14,377 meters to support ongoing and future production.
Production at the start of Q2 2024 was approximately 100 tpd (tonnes per day), compared to no production in the same period last year.
Costs at Plomosas stabilized over the first six months of 2024 despite ongoing costs related to site improvements and mine development, resulting in a $0.2 million cost decrease in Q2 2024 compared to Q1 2024.
Plomosas High-Grade Zinc Mine Review

Following the acquisition of the Plomosas high grade zinc (lead-silver) mine in April 2023, the Company was focused on rehabilitating the mine, plant and equipment, and commenced limited start-up operations in late 2023 while initiating an extensive exploration program. During Q2 2024, the Company accelerated the production ramp-up at Plomosas and expects continued growth in production levels, reaching 150-170 tpd by the end of Q3 2024 and eventually design capacity levels by late 2024/early 2025 of 225 tpd.

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