Guanajuato Silver Company Ltd reported a net income of $557,000 for the second quarter of 2026, marking its second consecutive quarter of profitability. The Vancouver-based miner generated revenue of $42.5 million, largely driven by precious metal sales.

The company significantly reduced its debt burden during the period by making an accelerated repayment on its gold loan with Ocean Partners UK Ltd. This move eliminated all future monthly payments, leaving only one final payment due in April 2028.

Financial Performance

Revenue remained stable compared to the previous quarter, which saw total sales of $43.0 million. Over 95% of the Q2 revenue was derived from the sale of precious metals, with silver accounting for 57% of the total. Adjusted EBITDA stood at $5.8 million for the quarter and $20.6 million for the first half of 2026. Mine operating income was also positive at $9.1 million.

Production Updates

Silver production increased by 2% to 347,481 ounces. Conversely, gold production declined by 15% to 3,653 ounces, attributed to the ongoing ramp-up and integration process at the Bolanitos Mine. Base metal production continued exclusively at the Topia Mine, yielding 727,370 pounds of lead and 956,217 pounds of zinc.

What the Numbers Show

The divergence between rising silver production and falling gold output highlights the operational focus shift across assets. While Bolanitos remains in development, leading to lower gold yields, the company maintained steady silver volumes. Additionally, the decision to pause extraction at the Valenciana Mines Complex to prioritize exploration suggests a strategic pivot toward long-term resource definition rather than immediate short-term volume gains from that specific asset.

Debt and Hedging Strategy

The accelerated debt repayment involved paying down 3,029 ounces of gold, valued at $12.1 million based on the Q2 closing gold price of $4,026. The remaining outstanding payment is valued at $9.5 million. Cash, cash equivalents, and short-term investments totaled $19.9 million at the end of the quarter.

To manage price volatility, the company hedged approximately 25% of current gold production (300 ounces per month) at a fixed price of $5,220 per ounce until December 2026. For silver, hedges cover approximately 34% of current production, including forward sales at $84.50 per ounce and collars ranging from $80 to $93 per ounce.

Guanajuato Silver Company Ltd. announced the resignation of Richard Silas from his roles as VP Corporate Development and Corporate Secretary on July 7, 2026. Mr. Silas will remain a member of the Board of Directors but will curtail his day-to-day activities to attend to a personal matter. The company appointed Susana Del Rio as the new VP of Administration and Corporate Secretary to assume these responsibilities.

Ms. Del Rio currently leads Guanajuato Silver's legal and compliance team. She is a graduate of the Monterrey Institute of Technology and has held several managerial positions within the company over the past six years. The transition aims to maintain operational continuity as the company manages its producing assets in Mexico.

Guanajuato Silver is a precious metals producer with a portfolio of silver and gold mines in central Mexico. The company operates four silver-gold assets in the state of Guanajuato, which has a 480-year mining history. Additionally, the company produces silver, gold, lead, and zinc concentrates from the Topia mine in northwestern Durango.

The leadership change follows standard corporate governance procedures. James Anderson, Chairman and CEO, signed the announcement on behalf of the Board of Directors. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.