Mr. James Anderson reports

GUANAJUATO SILVER REPORTS INCREASED PRODUCTION IN Q2

Guanajuato Silver Company Ltd. has released consolidated production results for the three months ended June 30, 2023. Production results are generated from the company's wholly owned El Cubo mines complex, Valenciana mines complex (VMC) and San Ignacio mine in Guanajuato, Mexico, and the Topia mine in Durango, Mexico.

Q2 2023 production highlights:

• Record production during the quarter of 941,338 silver equivalent ounces (AgEq) derived from 477,650 ounces of silver, 4,719 ounces of gold, 875,802 pounds of lead and 897,258 pounds of zinc.
• The development of the El Condor tunnel project at the Topia mine has accessed the Argentina vein in an area that previous operators had not reached; the new tunnel opens up the potential for additional mineralized material that would sit in close proximity to the mill. The Argentina vein is the most important producing vein system in the district and has been the primary structure mined at Topia for the past 40 years. The nearby Santa Cruz vein was also accessed with the El Condor tunnel, and both veins are currently being drilled with results being collected and analyzed.
• Underground hydraulic fill tailings system successfully realized at the VMC; tailings material continues to be deposited underground in one of the numerous voids that have been created over Valenciana's 450-year mining history.
• The Cata shaft at VMC is now fully integrated into mining operations; for the month of June, over 5,000 tonnes of mineralized material were hoisted to surface through this shaft. The shaft, together with a new underground locomotive system, has reduced haulage costs from the lower levels and reduced the wear and tear on trucks, tires and ramps.
• The recovery of high-grade mine pillars has now begun at VMC and this program of pillar extraction is expected to grow over the coming months (see Guanajuato Silver news release dated July 11, 2023).

James Anderson, chairman and chief executive officer, said: "We are proud to announce our sixth consecutive quarter of increased precious metals production; we expect this trend to continue as we head into the second half of the year. During Q1 and Q2, we have implemented a number of efficiency upgrades that are now poised to generate significant improvements to production grades and volumes, as we look to optimize mine production at all four of our producing silver mines. Furthermore, we continue to pursue additional opportunities to grow our production portfolio as we move towards becoming Mexico's next mid-tier silver producer."

Q2 2023 mine operations continues trend of overall quarter-over-quarter production increases:

• Consolidated mine production increased 2.5 per cent in Q2 2023 to 166,171 tonnes mined, as compared with 162,116 tonnes mined in Q1 2023.
• Consolidated silver production increased 4 per cent to 477,650 ounces in Q2 2023 compared with 458,803 ounces in Q1 2023; similarly, consolidated gold production increased by 7 per cent to 4,719 ounces over the same period; however, overall lead and zinc production at Topia decreased by 3.4 per cent and 22.2 per cent, respectively, in Q2 2023 from Q1 2023 primarily due to a shift to targeting mineralized material that contained higher grades of silver and gold versus base metals.
• Consolidated silver equivalent production in Q2 2023 was higher by 3,291 ounces over the previous quarter; this increase reflects the continuing ramp-up of operations at all of Guanajuato Silver's mining assets.
• Average recoveries for silver, gold and lead increased to 84.9 per cent, 83.1 per cent and 87.4 per cent, respectively, in Q2 2023 from Q1 2023, although average recoveries for zinc dropped from 83.5 per cent in Q1 2023 to 78.1 per cent in Q2 2023 primarily due to lower-grade throughput of zinc.

About Guanajuato Silver Company Ltd.

Guanajuato Silver is a precious metals producer engaged in reactivating past-producing silver and gold mines in central Mexico. The company produces silver and gold concentrates from the El Cubo mines complex, Valenciana mines complex and the San Ignacio mine; all three mines are located within the state of Guanajuato, which has an established 480-year mining history. Additionally, the company produces silver, gold, lead and zinc concentrates from the Topia mine in northwestern Durango. With four operating mines and three processing facilities, Guanajuato Silver is one of the fastest-growing silver producers in Mexico.

Technical information

Reynaldo Rivera, vice-president of exploration of Guanajuato Silver, has approved the scientific and technical information contained in this news release. Mr. Rivera is a member of the Australasian Institute of Mining and Metallurgy (AusIMM -- registration No. 220979) and a qualified person as defined by National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

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