Impact Silver produces 632,862 oz silver in 2022

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Impact Silver Corp. [IPT-TSXV; ISVLF-OTC; IKL-FSE] reported its financial and operating results for the year ended December 31, 2022. The company is one of the most focused silver-dominated companies at the centuries-old Royal Mines of Zacualpan Silver District in central Mexico.

Impact Silver is in the process of finalizing the transformative acquisition of the Plomosas zinc-lead-silver mine in northern Mexico, which is expected to add meaningful revenue, commodity diversification and financial growth driven by exceptionally high grade zinc production.

The company reported $16.3 million in revenue in 2022 compared to $17.7 million in revenue in 2021. Despite operational improvements and cost saving initiatives, the decline in revenue owes to a 13.6% decline in silver prices. Mine operating earnings before amortization and depletion in 2022 were $1.2 million (compared to $4.7 million in 2021) owing to lower silver prices and increased inflationary pressures on costs, wages, a stronger Mexican Peso, as well as additional exploration and drilling costs. Management believes cost controls implemented throughout 2022 as well as recovering silver prices as of late, will result in improving margins throughout 2023.

Fred Davidson, president and CEO, stated, “2022 was one of the most difficult years for global equities and hard assets, with several notable black swan events including the war in Ukraine, unprecedented global inflation and tight supply chains. The resulting increases in interest rates by central banks worldwide resulted in an unprecedented rate hike cycle that started from near zero percent, to over 5% through year-end and into 2023. Despite this, Impact managed to minimize losses and position the company on a trajectory of improved margins and growth in 2023. The company maintains an enviable, cash-rich balance sheet with no debt, as well as controls on cost inflation at the consumables and labour levels.

“Our dual-pronged strategy focuses on improving metal grade from existing and new development sites while exploiting added efficiencies at the company’s primary production mill. Meanwhile, shareholders can look forward to increased production, commodity diversification, exploration upside and top quartile zinc grades from the recently announced acquisition of the Plomosas high-grade zinc-lead-silver mine. This transformative acquisition should help significantly improve revenue, margins and deliver shareholder value as we deploy our 17 years of Mexican production experience to bring that operation online and deliver growth both at the production and exploration levels.

“Backstopping this growth is the company’s Guadalupe mining complex, which is one of the most efficient and productive mining complexes in the region, and our nearby Capire production centre which represents capacity to rapidly expand production as silver prices increase.”

In 2022, Impact carried out greenfield and brownfield exploration programs toward growing high-grade feed inventory for the company’s milling operations. In addition to its 211 km2 of exploration potential from its legacy Zacualpan-area land package, Impact is completing and integrating its recently-announced acquisition of the high-grade zinc-lead-silver Plomosas asset.

In 2022, the company produced 632,862 ounces of silver, compared to 2021 production of 617,686 ounces, representing an increase of 2% on a year-over-year basis.

Meanwhile, silver sales also increased by 2% to 644,843 ounces in 2022 compared to 2021, owing to efficiencies in milling operations.

Average silver grade at the mill level was 159 grams per tonne g/t in 2022 and was unchanged on a year-over-year basis. In 2022, mill throughput was 152,862 tonnes compared to 145,458 tonnes in 2021 – averaging 419 tonnes per day.

The company aims to assume operations at the recently announced Plomosas mine in northern Mexico in Q2-2023. The Plomosas project is located 110 km east of the city of Chihuahua.

Royal Mines of Zacualpan Silver-Gold District: Impact owns 100% of the 211 km2 Zacualpan project where four underground silver mines and one open pit mine feed the central 500 tpd Guadalupe processing plant. To the south, the Capire Project includes a 200 tpd processing pilot plant adjacent to an open pit silver mine with an NI 43-101 inferred mineral resource of over 4.5 million oz silver, 48 million lbs zinc and 21 million lbs lead.

Company engineers are reviewing Capire for a potential restart of operations. Over the past 17 years, Impact has placed multiple zones into commercial production and produced over 12 million ounces of silver, generating revenues over $241 million.

Plomosas Zinc-Lead-Silver District: Impact signed a purchase / sale agreement with Consolidated Zinc Limited of Australia to purchase the Plomosas property and mining operations for US$6 million (cash and shares) plus a 12% NPI (net profit interest) and a third party 1% NSR royalty. Plomosas is a high-grade zinc-lead-silver producer with exceptional exploration potential. Upon closing of the transaction, Impact plans to upgrade the mill and mine with the aim to recommence operations in the near term followed by plans for expanding operations.

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