SILV SilverCrest Metals Inc

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of November, 2023.

Commission File Number: 001-38628

SILVERCREST METALS INC.
(Exact Name of Registrant as Specified in Charter)

570 Granville Street, Suite 501

Vancouver, British Columbia V6C 3P1

Canada
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F      ⃞  Form 40-F  ⊠

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SILVERCREST METALS INC.
Date: November 9, 2023	/s/ Anne Yong
	Anne Yong
	Chief Financial Officer

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INDEX TO EXHIBITS

Exhibit		Description
99.1		Unaudited Condensed Consolidated Interim Financial Statements for the three and nine months ended September 30, 2023
99.2		Management's Discussion & Analysis for the three and nine months ended September 30, 2023
99.3		Certification of Interim Filings - CEO
99.4		Certification of Interim Filings - CFO
99.5		News release dated November 8, 2023 - Third Quarter 2023 Results

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CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023

 

 

 

 

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SILVERCREST METALS INC.

TABLE OF CONTENTS

	Page
Condensed Consolidated Interim Statements of Financial Position	3
Condensed Consolidated Interim Statements of Income and Comprehensive Income (Loss)	4
Condensed Consolidated Interim Statements of Cash Flows	5
Condensed Consolidated Interim Statement of Shareholders' Equity	6
Notes to the Condensed Consolidated Interim Financial Statements	7 - 22

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SILVERCREST METALS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (UNAUDITED - EXPRESSED IN THOUSANDS OF UNITED STATES DOLLARS) AS AT

		September 30, 2023			December 31, 2022
ASSETS
Current assets
Cash and cash equivalents	$	69,979		$	50,761
Bullion (note 3)		11,731			-
Accounts receivable		86			179
Value-added taxes receivable		16,478			15,985
Inventories (note 4)		46,509			40,203
Prepaid expenses and other		3,385			4,690
Total current assets		148,168			111,818
Non-current assets
Value-added taxes receivable		10,989			15,433
Mineral property, plant, and equipment (note 5)		241,124			228,098
Total non-current assets		252,113			243,531
TOTAL ASSETS	$	400,281		$	355,349
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities (note 6)	$	17,296		$	17,676
Tax liabilities (note 12)		12,474			5,740
Lease liabilities		69			116
Debt (note 7)		-			13,393
Total current liabilities		29,839			36,925
Non-current liabilities
Lease liabilities		234			260
Deferred income tax liability		1,608			382
Debt (note 7)		-			36,198
Reclamation and closure provision (note 8)		5,566			4,590
Total non-current liabilities		7,408			41,430
Total liabilities		37,247			78,355
Shareholders' equity
Capital stock (note 15)		402,199			405,811
Share-based payment reserve (note 15)		12,574			10,945
Foreign currency translation reserve		(3,538	)		(13,793	)
Deficit		(48,201	)		(125,969	)
Total shareholders' equity		363,034			276,994
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	400,281		$	355,349

Nature of operations (note 1)

Commitments (note 17)

Approved by the Board and authorized for issue on November 8, 2023:

"N. Eric Fier"

Director

"Anna Ladd-Kruger"

Director

 

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SILVERCREST METALS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) (UNAUDITED - EXPRESSED IN THOUSANDS OF UNITED STATES DOLLARS, EXCEPT FOR PER SHARE AMOUNTS; SHARES IN THOUSANDS) FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30,

		Three months ended						Nine months ended
		2023			2022			2023			2022
Revenue (note 9)	$	63,828		$	2,719		$	183,810		$	2,719
Cost of sales (note 10)		(26,368	)		(795	)		(72,451	)		(795	)
Mine operating income		37,460			1,924			111,359			1,924
Expenses
General and administrative expenses (note 11)	$	(2,772	)	$	(1,492	)	$	(8,630	)	$	(4,664	)
Exploration and evaluation expenditures		(250	)		(1,280	)		(627	)		(4,669	)
Share-based compensation expense (note 14 and 15)		(36	)		(338	)		(592	)		(717	)
		(3,058	)		(3,110	)		(9,849	)		(10,050	)
Other income (expense)
Foreign exchange (loss) gain (note 17)		(355	)		25,681			(7,877	)		32,406
Interest and finance expense (note 13)		(3,502	)		(65	)		(5,539	)		(192	)
Interest and investment income		682			782			2,587			1,925
Income before income taxes		31,227			25,212			90,681			26,013
Income tax (expense) recovery (note 12)		(1,291	)		-			(9,878	)		57
Income for the period	$	29,936		$	25,212		$	80,803		$	26,070
Other comprehensive income (loss)
Foreign currency translation adjustment		-			(26,553	)		10,255			(33,386	)
Comprehensive income (loss) for the period	$	29,936		$	(1,341	)	$	91,058		$	(7,316	)
Basic income per common share	$	0.20		$	0.17		$	0.55		$	0.18
Diluted income per common share	$	0.20		$	0.17		$	0.54		$	0.17
Weighted average number of common shares outstanding
Basic		146,776			146,346			147,067			146,002
Diluted		148,123			152,217			148,410			152,118

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SILVERCREST METALS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (UNAUDITED - EXPRESSED IN THOUSANDS OF UNITED STATES DOLLARS) FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30,

		Three months ended September 30,						Nine months ended September 30,
		2023			2022			2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES
Income for the period	$	29,936		$	25,212		$	80,803		$	26,070
Adjustments for:
Depreciation and depletion (note 5)		6,316			14			15,391			43
Foreign exchange (gain) loss, unrealized		147			(22,284	)		7,100			(25,447	)
Income tax expense (recovery)		1,291			-			9,878			(57	)
Income taxes paid		-			-			(987	)		-
Interest and finance expense (note 13)		3,473			65			5,471			192
Interest and investment income		(682	)		(782	)		(2,587	)		(1,925	)
Share-based compensation		443			410			1,857			1,007
Cash flow provided by operating activities before changes in non-cash working capital items		40,924			2,635			116,926			(117	)
Changes in non-cash working capital items:
Accounts receivable		34			(1,103	)		69			(1,099	)
Value-added taxes receivable		(1,020	)		(2,082	)		4,434			(5,141	)
Inventories		943			(11,501	)		4,126			(18,761	)
Prepaids and deposits		(93	)		24			1,178			1,092
Accounts payable and accrued liabilities		6,559			170			(5,125	)		(1,105	)
Tax liabilities		(4,127	)		-			(576	)		-
Net cash (used in) provided by operating activities		43,220			(11,857	)		121,032			(25,131	)
CASH FLOWS FROM INVESTING ACTIVITIES
Bullion		(6,228	)		-			(12,019	)		-
Interest and investment income received		700			686			2,784			1,741
Expenditures on mineral property, plant, and equipment		(13,081	)		(13,033	)		(33,930	)		(52,080	)
Net cash used in investing activities		(18,609	)		(12,347	)		(43,165	)		(50,339	)
CASH FLOWS FROM FINANCING ACTIVITIES
Capital stock issued		74			529			253			1,383
Common shares repurchased and cancelled		(7,139	)		-			(7,139	)		-
Loan prepayments		-			-			(50,000	)		-
Loan interest payments		(119	)		(2,125	)		(1,651	)		(5,949	)
Payment of lease liabilities		(11	)		(41	)		(82	)		(120	)
Net cash used in financing activities		(7,195	)		(1,637	)		(58,619	)		(4,686	)
Effect of foreign exchange on cash and cash equivalents		(850	)		(4,163	)		(30	)		(7,782	)
Change in cash and cash equivalents, during the period		16,566			(30,004	)		19,218			(87,938	)
Cash and cash equivalents, beginning of the period		53,413			118,581			50,761			176,515
Cash and cash equivalents, end of the period	$	69,979		$	88,577		$	69,979		$	88,577
Cash and cash equivalents is represented by:
Cash	$	69,979		$	87,512		$	69,979		$	87,512
Cash equivalents		-			1,065			-			1,065
Total cash and cash equivalents	$	69,979		$	88,577		$	69,979		$	88,577
Non-cash investing activities
Capitalized to mineral property, plant, and equipment
Transfers to inventories	$	-		$	-		$	-		$	(8,277	)
Accounts payable and accrued liabilities	$	3,060		$	5,308		$	3,060		$	5,308
Depreciation and depletion (note 5)	$	54		$	867		$	221		$	2,101
Loan interest accretion	$	-		$	262		$	-		$	1,565
Share-based compensation	$	89		$	130		$	280		$	1,044
Interest on lease liabilities	$	-		$	4		$	1		$	12
Change in reclamation and closure provision	$	(65	)	$	145		$	(65	)	$	(1	)
Supplementary cash flow information		September 30, 2023			June 30, 2023			September 30, 2023			December 31, 2022
Mineral property, plant, and equipment in accounts payable and accrued liabilities	$	3,060		$	3,747		$	3,060		$	3,350

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SILVERCREST METALS INC. CONDENSED CONSOLIDATED INTERIM STATEMENT OF SHAREHOLDERS’ EQUITY (UNAUDITED - EXPRESSED IN THOUSANDS OF UNITED STATES DOLLARS; SHARES IN THOUSANDS)

		Capital stock						Share-based			Foreign currency
								payment			translation
		Number			Amount			reserve			reserve			Deficit			Total
Balance at December 31, 2021		145,649		$	401,736		$	9,782		$	14,194		$	(157,442	)	$	268,270
Stock options exercised		838			2,244			(861	)		-			-			1,383
Stock options forfeited		-			-			(33	)		-			33			-
Share-based compensation, stock options		-			-			2,289			-			-			2,289
Foreign exchange translation		-			-			-			(33,386	)		-			(33,386	)
Income for the period		-			-			-			-			26,070			26,070
Balance at September 30, 2022		146,487			403,980			11,177			(19,192	)		(131,339	)		264,626
Stock options exercised		669			1,831			(747	)		-			-			1,084
Stock options forfeited		-			-			(139	)		-			139			-
Share-based compensation, stock options		-			-			654			-			-			654
Foreign exchange translation		-			-			-			5,399			-			5,399
Income for the period		-			-			-			-			5,231			5,231
Balance at December 31, 2022		147,156			405,811			10,945			(13,793	)		(125,969	)		276,994
Stock options exercised (note 15)		105			414			(161	)		-			-			253
Stock options forfeited (note 15)		-			-			(78	)		-			78			-
Share-based compensation, stock options (note 15)		-			-			1,868			-			-			1,868
Shares repurchased and cancelled (note 15)		(1,503	)		(4,026	)		-			-			(3,113	)		(7,139	)
Foreign exchange translation		-			-			-			10,255			-			10,255
Income for the period		-			-			-			-			80,803			80,803
Balance at September 30, 2023		145,758		$	402,199		$	12,574		$	(3,538	)	$	(48,201	)	$	363,034

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1. NATURE OF OPERATIONS

SilverCrest Metals Inc. (the "Company" or "SilverCrest") is a Canadian precious metals producer headquartered in Vancouver, British Columbia. The Company was incorporated under the Business Corporations Act (British Columbia). The common shares of the Company trade on the Toronto Stock Exchange ("TSX") under the symbol "SIL" and on the NYSE-American under the symbol "SILV". The head office and principal address of the Company is 501-570 Granville Street, Vancouver, BC, Canada, V6C 3P1. The address of the Company's registered and records office is 19^th Floor, 885 West Georgia Street, Vancouver, BC, Canada, V6C 3H4.

The Company's principal focus is its Las Chispas Operation, located in Sonora, Mexico.

2. SIGNIFICANT ACCOUNTING POLICIES

Statement of compliance

These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34 - Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB"). These condensed consolidated interim financial statements should be read in conjunction with the Company's consolidated financial statements for the year ended December 31, 2022, which include information necessary or useful to understanding the Company's business and financial statement presentation. In particular, the Company's significant accounting policies, use of judgments and estimation methods were presented in notes 2 and 3, respectively, of those consolidated financial statements and have been consistently applied in the preparation of these condensed consolidated interim financial statements. In addition, please refer to note 3 below for similar details in relation to bullion and call options and put options which became new accounting items during 2023.

Basis of preparation and measurement

These condensed consolidated interim financial statements have been prepared on a historical cost basis, except for certain financial instruments which are measured at fair value. Additionally, these condensed consolidated interim financial statements have been prepared using the accrual basis of accounting, except for cash flow information.

These condensed consolidated interim financial statements were approved for issuance by the Board of Directors on November 8, 2023.

Basis of consolidation

These condensed consolidated interim financial statements incorporate the financial statements of the Company and its subsidiaries, all of which are wholly owned. There has been no change to the Company's subsidiaries since December 31, 2022. The Company consolidates subsidiaries where the Company can exercise control. Control is achieved when the Company is exposed to variable returns from involvement with an investee and can affect the returns through power over the investee. Control is normally achieved through ownership, directly or indirectly, of more than 50 percent of the voting power. Control can also be achieved through power over more than half of the voting rights by virtue of an agreement with other investors or through the exercise of de facto control. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition of control up to the effective date of loss of control.

The Company's principal subsidiary at September 30, 2023 was the wholly-owned Compañía Minera La Llamarada, S.A. de C.V. located in Mexico whose principal project and purpose is ownership and operation of the Las Chispas Operation.

Intercompany assets, liabilities, equity, income, expenses, and cash flows between the Company and its subsidiaries are eliminated on consolidation.

Change in functional currency

The functional currency is the currency of the primary economic environment in which an entity operates. The Company considered the functional currency of the parent entity to be the Canadian Dollar ("C$") until June 30, 2023, after which the functional currency changed to the United States Dollar ("US$"). The functional currency was determined and treated in accordance with IAS 21 The effects of changes in foreign exchange rates which includes accounting for the functional currency change on a prospective basis.

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3. BULLION

Gold and silver bullion

During the nine months ended September 30, 2023, the Company purchased gold and silver bullion from a bullion bank to hold as treasury assets in accordance with its liquidity management policies.

Bullion is initially recorded at cost on acquisition and subsequently measured at fair value at the end of each reporting period. Changes in the fair value are recognized in the period the changes occur. These changes are recorded to interest and investment income in the consolidated statements of income and comprehensive income (loss).

Bullion holdings at September 30, 2023 are as follows:

		Cost			Fair market value
		September 30, 2023			September 30, 2023
Gold bullion	$	3,116		$	2,956
Silver bullion		8,903			8,775
Total bullion	$	12,019		$	11,731

Bullion options

During the nine months ended September 30, 2023, the Company sold call options and purchased put options. Call options are instruments that give the option holder the right, but not the obligation, to purchase gold or silver at an agreed upon price in the future. Put options are instruments that give the option holder the right, but not the obligation, to sell gold or silver at an agreed upon price in the future. The Company receives an option premium in cash on selling the option, which is recorded as either an asset or a liability. The value of the option is remeasured using the Black-Scholes option pricing model at each reporting date, with gains or losses recorded as interest and other investment income, along with a corresponding increase to the derivative liability which is included in accounts payable and accrued liabilities.

4. INVENTORIES

The Company's inventories related to the Las Chispas Operation were comprised of the following:

		September 30, 2023			December 31, 2022
Stockpiled ore	$	26,213		$	25,669
Work-in-process		2,354			4,353
Finished goods		10,328			4,897
Materials and supplies		7,614			5,284
Total inventories	$	46,509		$	40,203

At September 30, 2023, $9,602 (December 31, 2022 - $3,747) of depreciation and depletion and $715 (December 31, 2022 - $870) of share-based compensation was included in inventories. The Company did not hold any non-current inventories.

During the nine months ended September 30, 2023, the Company expensed $68,064 (September 30, 2022 - $687) of inventories to cost of sales.

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5. MINERAL PROPERTY, PLANT, AND EQUIPMENT

		Property, plant, and equipment			Construction in progress			Mineral property(1)			Exploration and evaluation assets			Total
Cost
At December 31, 2021	$	18,817		$	84,283		$	62,285		$	2,488		$	167,873
Additions		22,458			2,257			58,006			-			82,721
Transfers		83,179			(83,179	)		-			-			-
Transfers to inventory		-			-			(13,655	)		-			(13,655	)
At December 31, 2022		124,454			3,361			106,636			2,488			236,939
Additions		2,059			4,667			27,698			-			34,424
Transfers and reclassifications		2,006			(2,343	)		-			-			(337	)
At September 30, 2023	$	128,519		$	5,685		$	134,334		$	2,488		$	271,026
Accumulated depreciation and depletion
At December 31, 2021	$	(2,187	)	$	-		$	-		$	-		$	(2,187	)
Depreciation and depletion for the year(2)(3)		(5,118	)		-			(1,536	)		-			(6,654	)
At December 31, 2022		(7,305	)		-			(1,536	)		-			(8,841	)
Depreciation and depletion for the period(2)(3)		(11,581	)		-			(9,480	)		-			(21,061	)
At September 30, 2023	$	(18,886	)	$	-		$	(11,016	)	$	-		$	(29,902	)
Carrying amounts
At December 31, 2022	$	117,149		$	3,361		$	105,100		$	2,488		$	228,098
At September 30, 2023	$	109,633		$	5,685		$	123,318		$	2,488		$	241,124

⁽¹⁾ Mineral property relates to the producing Las Chispas Operation.

⁽²⁾ Depreciation and depletion related to the production of mineral inventory is initially capitalized as inventories and subsequently expensed as cost of sales, when sold. During the nine months ended September 30, 2023, the Company recorded $15,356 (September 30, 2022 - $65) of depreciation and depletion in cost of sales, which included amounts capitalized in 2022.

⁽³⁾ Depreciation related to the development of the Las Chispas Mine is capitalized to mineral property.

6. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

		September 30, 2023			December 31, 2022
Trade payables	$	2,701		$	5,612
Accrued liabilities		10,447			8,954
Payroll related liabilities		2,200			728
Share unit accrued liabilities		1,948			2,382
Accounts payable and accrued liabilities	$	17,296		$	17,676

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7. DEBT

A summary of debt transactions is as follows:

		Nine months ended			Year ended
Term Facility		September 30, 2023			December 31, 2022
Balance, beginning of period (year)	$	49,591		$	-
Drawdown		-			50,000
Transaction costs		-			(417	)
Accretion		409			8
Interest expense		1,030			354
Interest payments		(1,030	)		(354	)
Debt repayment		(50,000	)		-
Balance, end of period (year)	$	-		$	49,591
Total debt	$	-		$	49,591
Less: current portion		-			(13,393	)
Long-term debt	$	-		$	36,198

Credit Facility

On November 29, 2022, the Company refinanced its 2020 secured project financing facility (the "Project Financing Facility") with a new $120,000 senior secured credit facility (the "Credit Facility") through a syndicate of two banks. The Credit Facility includes a $50,000 term facility ("Term Facility") with a maturity date of November 28, 2025 and a $70,000 revolving facility ("Revolving Facility") with a maturity date of November 27, 2026. On closing of the Credit Facility, the Company fully drew the $50,000 Term Facility and used $40,000 of available cash to repay the previously outstanding $90,000 Project Financing Facility.

Within the first five months of 2023, the Company voluntarily prepaid the full $50,000 Term Facility principal. As of September 30, 2023, there had been no draws on the Revolving Facility. The Revolving Facility of $70,000 will be available to the Company until November 27, 2026, for general corporate purposes and working capital (funds available to meet current and short-term obligations), subject to customary terms and conditions.

The Revolving facility bears interest, and the Term Facility when outstanding bore interest, at a rate based initially on an adjusted Term secured overnight financing rate as administered by the Federal Reserve Bank of New York ("SOFR"), plus an applicable margin ranging from 2.50% to 3.75%.  The undrawn portion of the Revolving Facility is subject to a standby fee ranging from 0.5625% to 0.8428% per annum.

All debt under the Credit Facility is guaranteed by the Company and its subsidiaries and secured by the assets of the Company and NorCrest Metals Inc. (a subsidiary of the Company) and pledges of the securities of the Company's subsidiaries. The Credit Facility includes certain financial and non-financial covenants and at September 30, 2023, the Company was in compliance with all covenants.

8. RECLAMATION AND CLOSURE PROVISION

Changes to the reclamation and closure provision related to the Las Chispas Operation were as follows:

		September 30, 2023			December 31, 2022
Balance, beginning of period (year)	$	4,590		$	2,713
Increase in estimated cash flows resulting from current activities		902			2,566
Changes in estimate		(281	)		(932	)
Accretion		355			243
Balance, end of period (year)	$	5,566		$	4,590

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8. RECLAMATION AND CLOSURE PROVISION (continued)

The reclamation and closure cost provision is calculated as the present value of estimated future net cash outflows based on the following key assumptions:

● The discount rate used in discounting the estimated reclamation and closure cost provision was 9.7% (December 31, 2022 - 8.9%) during the nine months ended September 30, 2023 and is a risk-free rate based on the Bank of Mexico's 10 year bond rate.

● The majority of the expenditures are expected to occur in 2031 and 2032.

● A 1% change in the discount rate would result in an approximate $400 increase or $500 decrease in the provision, while holding other assumptions consistent.

The undiscounted value of the reclamation and closure provision is estimated to be $12,499 (December 31, 2022 - $11,158) which is calculated using a long-term inflation rate assumption of 4.5% (December 31, 2022 - 4.6%). In addition, the Mexico peso to US$ exchange rate used as at September 30, 2023 for the estimated reclamation and closure costs provision was 17.4:1 (December 31, 2022 - 19.5:1).

9. REVENUE

The Company did not have any revenue prior to the third quarter of 2022. During the nine months ended September 30, 2023, the Company had revenue of $183,810 (September 30, 2022 - $2,719) from the sale of 42,100 (September 30, 2022 - Nil) gold ounces and 4.3 million (September 30, 2022 - 0.1 million) silver ounces to three (September 30, 2022 - two) customers.

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Gold	$	28,005		$	-		$	81,361		$	-
Silver		35,823			2,719			102,449			2,719
Revenue		63,828			2,719			183,810			2,719
Customer A		4,632			2,328			13,043			2,328
Customer B		22,421			391			96,959			391
Customer C		36,775			-			73,808			-
Revenue	$	63,828		$	2,719		$	183,810		$	2,719

10. COST OF SALES

The Company did not have any cost of sales prior to the third quarter of 2022. Cost of sales were:

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Mine	$	8,966		$	352		$	26,427		$	352
Plant		5,062			171			15,927			171
Indirect		2,741			86			8,092			86
Production costs	$	16,769		$	609		$	50,446		$	609
Changes in inventories		1,662			26			1,691			26
Refining and transportation costs		777			70			2,425			70
Depletion and depreciation		6,322			65			15,356			65
Extraordinary mining duty		319			13			927			13
Site share-based compensation		398			12			1,241			12
Other		121			-			365			-
Cost of sales	$	26,368		$	795		$	72,451		$	795

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10. COST OF SALES (continued)

Production costs and changes in inventories by nature of expense were:

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Salaries and benefits	$	2,664		$	45		$	7,056		$	45
Consultants and contractors		8,502			298			22,720			298
Utilities and other services		1,137			81			3,155			81
Supplies and consumables		4,267			161			13,373			161
Maintenance and mechanical		1,116			34			3,985			34
Office and other supplies		700			6			1,699			6
Rents		45			10			149			10
Production costs & changes in inventories	$	18,431		$	635		$	52,137		$	635

11. GENERAL AND ADMINISTRATIVE EXPENSES

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
General and administrative	$	1,575		$	600		$	4,691		$	1,754
Marketing		104			132			386			446
Professional fees		237			178			1,023			679
Remuneration		856			582			2,530			1,785
General and administrative expenses	$	2,772		$	1,492		$	8,630		$	4,664

12. INCOME TAX

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Income tax recovery (expense) at statutory rate of 27%	$	(8,432	)	$	-		$	(24,484	)	$	57
7.5% special mining duty		(2,680	)		-			(7,880	)		-
Change in permanent differences		6,023			-			6,006			-
Change in unrecognized temporary differences and other		3,798			-			16,480			-
Income tax recovery (expense)	$	(1,291	)	$	-		$	(9,878	)	$	57

Income taxes were comprised of:

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Current income tax recovery (expense)	$	(2,680	)	$	-		$	(7,880	)	$	57
Deferred income tax recovery (expense)		1,389			-			(1,998	)		-
Income tax recovery (expense)	$	(1,291	)	$	-		$	(9,878	)	$	57

At September 30, 2023, tax liabilities were $12,474 (December 31, 2022 - $5,740) and were primarily comprised of accrued withholding tax on interest charged on intercompany loan balances and 7.5% special mining duty.

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13. INTEREST AND FINANCE EXPENSE

		Three months ended September 30, 2023			Three months ended September 30, 2022			Nine months ended September 30, 2023			Nine months ended September 30, 2022
Interest expense - debt (note 7)	$	154		$	-		$	1,919		$	-
Accretion of reclamation and closure provision (note 8)		132			61			355			178
Other financing costs (1)		3,216			4			3,265			14
Interest and finance expense	$	3,502		$	65		$	5,539		$	192

⁽¹⁾ During the nine months ended September 30, 2023 in connection with intercompany tax planning, the Company incurred a non-refundable value-added tax (IVA) charge of $3,180. This charge was offset against value-added taxes receivable.

14. RELATED PARTY TRANSACTIONS

Professional fees

The Company had the following transactions with a law firm of which the Company's Corporate Secretary is a partner.

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
Professional fees - expense	$	129		$	82

		September 30, 2023			December 31, 2022
Payable to Koffman Kalef LLP	$	7		$	12

Key management compensation

The Company's key management personnel have authority and responsibility for planning, directing, and controlling the activities of the Company and comprise the Company's Chief Executive Officer ("CEO"), President, Chief Financial Officer ("CFO"), Chief Operating Officer ("COO"), and directors. Key management personnel compensation is summarized as follows:

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
Salaries, short-term incentives, management fees, and directors' fees (1)	$	2,479		$	1,160
Share-based compensation(2)		647			793
	$	3,126		$	1,953

⁽¹⁾ Salaries, short-term incentives, management fees, and directors' fees include remuneration and short-term benefits paid to the President, CFO, COO, and directors. The management fees were paid to a company controlled by the CEO.

⁽²⁾ Share-based compensation includes amounts recorded for stock options and share units. Please see note 15 for further details.

Other transactions

● The Company has an allocation of costs agreement with Goldsource Mines Inc. ("Goldsource"), a company related by common directors and officers, whereby the Company shares salaries, administrative services, and other expenses. Amounts allocated to Goldsource are due at the end of each fiscal quarter and accrue interest at a rate of 1% per month, if in arrears for greater than 30 days.

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
Costs allocated to Goldsource	$	40		$	53
		September 30, 2023			December 31, 2022
(Payable to) receivable from Goldsource	$	(14	)	$	19

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15. CAPITAL STOCK

Authorized shares

The Company's authorized capital stock consists of an unlimited number of common shares and an unlimited number of preferred shares without nominal or par value.

Issued and outstanding

As of September 30, 2023, the Company had 145,758,364 common shares and no preferred shares outstanding.

During the nine months ended September 30, 2023, the Company issued 105,000 common shares at C$3.24 per share for gross proceeds of $253 upon the exercise of stock options.

In 2022, the Company issued 1,507,500 common shares at prices ranging from C$1.84 per share to C$8.24 per share for gross proceeds of $2,467 upon the exercise of stock options.

Normal Course Issuer Bid ("NCIB") - Share repurchase program and share cancellation

During the nine months ended September 30, 2023, the Company received TSX acceptance of a NCIB permitting the Company to purchase up to 7,361,563 common shares of the Company over a 12-month period beginning on August 14, 2023. Under the NCIB, the Company may purchase up to a maximum of 80,376 common shares on the TSX during any trading day. All common shares, if any, purchased pursuant to the NCIB will be cancelled.

Share repurchases and cancellations are recorded by allocating any excess consideration over book value to retained earnings or deficit.

During the nine months ended September 30, 2023, the Company repurchased and cancelled 1,502,900 common shares at an average price of C$6.44 per share for a total of $7,139. Upon the cancellation of shares, the Company allocated $4,026 to capital stock and $3,113 to deficit.

Stock options

The Company has a "rolling 5.5%" stock option plan, which authorizes the grant of stock options to directors, officers, employees, and consultants, enabling them to acquire common shares of the Company to a maximum of 5.5% of the then issued and outstanding common shares.

A summary of the Company's stock option transactions during the period (year) is as follows:

		Nine months ended September 30, 2023						Year ended December 31, 2022
		Number of			Weighted average			Number of			Weighted average
		options			exercised price (C$)			options			exercised price (C$)
Outstanding, beginning of period (year)		5,560,450		$	7.87			6,216,700		$	6.37
Granted		-			-			944,500			8.86
Exercised*		(105,000	)		3.24			(1,507,500	)		2.13
Forfeited		(40,000	)		10.25			(93,250	)		10.66
Outstanding, end of period (year)		5,415,450		$	7.94			5,560,450		$	7.87

*During the nine months ended September 30, 2023, the weighted average market value of the Company's shares at the dates of exercise was C$7.30 (December 31, 2022 - C$9.14).

During 2022, the Company granted 944,500 stock options to certain employees, a consultant, and directors with exercise prices ranging from C$7.31 to C$11.14 and expiring five years from the grant date. 157,000 options granted in 2022 to a consultant vest over a 32-month period with 50% of the options vesting after each of 20 months and 32 months after the grant date, respectively. The remaining options vest over a 3-year period with 1/3 of the options vesting after each of one year, two years, and three years after the grant date, respectively.

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15. CAPITAL STOCK (continued)

Stock options (continued)

Stock options outstanding and exercisable as of September 30, 2023 are as follows:

					Options outstanding						Options exercisable
		Exercise			Number of shares			Remaining life			Number of shares
Expiry date		price (C$)			issuable on exercise			(years)			issuable on exercise
December 14, 2023	$	3.24			1,130,000			0.21			1,130,000
May 30, 2024	$	4.54			110,250			0.67			110,250
September 4, 2024	$	8.21			836,250			0.93			836,250
December 19, 2024	$	8.24			740,450			1.22			740,450
September 14, 2025	$	12.53			125,000			1.96			125,000
November 11, 2025	$	12.63			25,000			2.12			16,666
December 7, 2025	$	11.22			50,000			2.19			33,334
February 25, 2026	$	10.87			694,000			2.41			462,674
July 26, 2026	$	9.97			100,000			2.82			66,666
August 3, 2026	$	10.80			37,500			2.84			24,998
December 21, 2026	$	9.79			627,500			3.23			209,165
April 1, 2027	$	11.14			70,000			3.50			23,333
May 2, 2027	$	9.69			157,000			3.59			-
July 11, 2027	$	7.31			25,000			3.78			8,333
December 16, 2027	$	8.50			687,500			4.21			-
					5,415,450						3,787,119

The weighted average remaining life of options outstanding is 1.90 years.

Share-based compensation

The fair value of options granted during 2022 was estimated using the Black-Scholes option pricing model using the following weighted average assumptions:

		Year ended December 31, 2022
Expected option life (years)		3.48
Expected volatility		55.35%
Expected dividend yield		-
Risk-free interest rate		3.10%
Expected forfeiture rate		1.00%
Fair value per option (C$)	$	3.72
Total fair value	$	2,701

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15. CAPITAL STOCK (continued)

Share-based compensation (continued)

A summary of the Company's share-based compensation for options vested during the period is as follows:

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
Share-based compensation expense	$	864		$	821
Share-based compensation recorded to inventories		736			279
Exploration and evaluation expenditures		22			249
Mineral property, plant, and equipment additions		246			940
Total share-based compensation on vested options	$	1,868		$	2,289
Share-based compensation expense
Share-based compensation expense - stock options	$	864		$	821
Share-based compensation (recovery) expense - deferred share units		(356	)		(207	)
Share-based compensation expense - restricted share units		119			88
Share-based compensation (recovery) expense - performance share units		(35	)		15
Total, share-based compensation expense	$	592		$	717

Share-based payment reserve

The share-based payment reserve records items recognized as share-based compensation. At the time that stock options are exercised, the corresponding amount is reallocated to share capital or, if cancelled or expired, the corresponding amount is reallocated to deficit.

A summary of share-based payment reserve transactions is as follows:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Balance, beginning of period (year)	$	10,945		$	9,782
Share-based compensation, stock options		1,868			2,943
Stock options exercised, reallocated to capital stock		(161	)		(1,608	)
Stock options forfeited, reallocated to deficit		(78	)		(172	)
Balance, end of period (year)	$	12,574		$	10,945

Deferred share units ("DSUs")

A summary of the Company's DSU transactions, shown in number of DSUs, during the period (year) is as follows:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Outstanding, beginning of period (year)		228,000			156,500
Granted(1)		-			96,000
Vested and settled in cash(2)		-			(24,500	)
Outstanding, end of period (year)		228,000			228,000

⁽¹⁾ All DSUs were granted to independent directors of the Company.

⁽²⁾ During 2022, 24,500 DSUs were settled in cash totalling $218 upon the retirement of a director.

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15. CAPITAL STOCK (continued)

Deferred share units (“DSUs”) (continued)

The following table summarizes the change in the accrued DSU liability:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Outstanding, beginning of period (year)	$	1,364		$	1,234
Settlement of DSUs during the period (year)		-			(218	)
Change in accrued DSU liability - share-based compensation (recovery) expense		(356	)		430
Effect of foreign currency translation		4			(82	)
Outstanding, end of period (year)(1)	$	1,012		$	1,364

⁽¹⁾ As at September 30, 2023, the market value of the Company's common shares was C$6.00 (December 31, 2022 - C$8.10).

Restricted share units ("RSUs")

A summary of the Company's RSU transactions, shown in number of RSUs, during the period (year) is as follows:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Outstanding, beginning of period (year)		249,498			83,500
Granted(1)(2)		-			195,500
Vested and settled in cash		-			(27,002	)
Forfeited		(8,666	)		(2,500	)
Outstanding, end of period (year)		240,832			249,498

⁽¹⁾ RSUs were granted to certain employees, consultants, and directors of the Company.

⁽²⁾ During 2022, 13,000 RSUs were granted to a consultant and vest over a 32-month period with 50% of the RSUs vesting after each of 20 months and 32 months after the grant date respectively. The remaining RSUs granted during 2022 vest over a 3-year period with 1/3 of the RSUs vesting after each of one year, two years, and three years after the grant date, respectively.

The following table summarizes the change in the accrued RSU liability:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Outstanding, beginning of period (year)	$	254		$	11
Settlement of RSUs during the period (year)		-			(175	)
Liability of forfeited RSUs(1)		(16	)		(6	)
Change in accrued RSU liability(1)		353			435
Effect of foreign currency translation		(1	)		(11	)
Outstanding, end of period (year)(2)	$	590		$	254

⁽¹⁾ During the nine months ended September 30, 2023, the Company recorded net share-based compensation of $337 (September 30, 2022 - $242), including an expense of $119 (September 30, 2022 - $88), inventories costs of $163 (September 30, 2022 - $29), exploration and evaluation expenditures of $5 (September 30, 2022 - $29), and mineral property, plant, and equipment cost of $50 (September 30, 2022 - $96).

⁽²⁾ As at September 30, 2023, the market value of the Company's common shares was C$6.00 (December 31, 2022 - C$8.10).

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15. CAPITAL STOCK (continued)

Performance share units ("PSUs")

Nine months ended September 30, 2023

During the nine months ended September 30, 2023, the Company issued 61,875 PSUs to executive officers of the Company in relation to the successful ramp-up of the Las Chispas processing plant which vest on December 31, 2023. During the nine months ended September 30, 2023, the Company also settled 82,500 PSUs in cash totalling $536 which were granted and settled based on completion of construction of the Las Chispas Mine.

Year ended December 31, 2022

During 2022, the Company issued 173,750 PSUs to executive officers of the Company, with 82,500 PSUs being in relation to the completion of construction of the Las Chispas Mine, which vested on June 1, 2023. The remaining 91,250 PSUs were granted as part of executive officers long-term incentive plans. These PSUs vest on the third anniversary of the grant date. The number of PSUs that vest may range from 0% to 200% of the number of PSUs granted, based on the relative total shareholder return against a designated peer group of companies over a three-year performance period.

The following table summarizes the change in the accrued PSU liability:

		Nine months ended September 30, 2023			Year ended December 31, 2022
Outstanding, beginning of period (year)	$	764		$	-
Settlement of PSUs during the period (year)		(536	)		-
Share-based compensation for PSUs(1)		116			795
Effect of foreign currency translation		3			(31	)
Outstanding, end of period (year)(2)	$	347		$	764

⁽¹⁾ During the nine months ended September 30, 2023, the Company recorded share-based compensation of $116 (2022 - $52), including a recovery of $35 (2022 - expense of $15), inventories costs of $171 (2022 - $29), exploration and evaluation expenditures recovery of $4 (2022 - $Nil) and mineral property, plant, and equipment recovery of $16 (2022 - expenditure of $8).

⁽²⁾ As at September 30, 2023, the market value of the Company's common shares was C$6.00 (December 31, 2022 - C$8.10).

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16. SEGMENTED INFORMATION

During the three and nine months ended September 30, 2023, the Company had one operating segment: the Las Chispas Operation. Corporate includes the corporate team that provides administrative, technical, financial, and other support to the Company's business units. During the three and nine months ended September 30, 2022, the Company had two operating segments: the Las Chispas Operation and El Picacho Property ("Picacho"), which is in the exploration phase. During the three and nine months ended September 30, 2023, Picacho was included under Corporate.

Significant information relating to the Company's reportable operating segments during the three and nine months ended September 30, 2023 and 2022 is summarized below:

					Las Chispas			Corporate			Total
Revenue for the three months ended September 30, 2023				$	63,828		$	-		$	63,828
Income (loss) for the three months ended September 30, 2023				$	33,874		$	(3,938	)	$	29,936
Capital additions during the three months ended September 30, 2023
Mineral property				$	9,859		$	-		$	9,859
Plant and equipment					2,529			-			2,529
Total capital additions				$	12,388		$	-		$	12,388
		Picacho			Las Chispas			Corporate			Total
Revenue for the three months ended September 30, 2022	$	-		$	2,719		$	-		$	2,719
Income (loss) for the three months ended September 30, 2022	$	(1,232	)	$	2,026		$	24,418		$	25,212
Capital additions during the three months ended September 30, 2022
Mineral property	$	-		$	13,788		$	-		$	13,788
Plant and equipment		-			3,485			-			3,485
Total capital additions	$	-		$	17,273		$	-		$	17,273

					Las Chispas			Corporate			Total
Revenue for the nine months ended September 30, 2023				$	183,810		$	-		$	183,810
Income (loss) for the nine months ended September 30, 2023				$	100,566		$	(19,763	)	$	80,803
Capital additions during the nine months ended September 30, 2023
Mineral property				$	27,698		$	-		$	27,698
Plant and equipment					6,726			-			6,726
Total capital additions				$	34,424		$	-		$	34,424
		Picacho			Las Chispas			Corporate			Total
Revenue for the nine months ended September 30, 2022	$	-		$	2,719		$	-		$	2,719
Income (loss) for the nine months ended September 30, 2022	$	(4,554	)	$	1,909		$	28,715		$	26,070
Capital additions during the nine months ended September 30, 2022
Mineral property	$	-		$	31,732		$	-		$	31,732
Plant and equipment		-			21,109			-			21,109
Total capital additions	$	-		$	52,841		$	-		$	52,841
					Las Chispas			Corporate			Total
As at September 30, 2023
Total assets				$	314,259		$	86,022		$	400,281
Total liabilities				$	26,676		$	10,571		$	37,247
		Picacho			Las Chispas			Corporate			Total
As at December 31, 2022
Total assets	$	2,489		$	283,358		$	69,502		$	355,349
Total liabilities	$	269		$	64,952		$	13,134		$	78,355

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17. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The Company is exposed to various financial instrument risks and assesses the impact and likelihood of this exposure.  These risks include liquidity, foreign currency, credit, commodity price, and interest rate risks. Where material, these risks are reviewed and monitored by the Board of Directors.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has in place a planning and budgeting process to help determine the funds required to ensure the Company has the appropriate liquidity to meet its operating and growth objectives. The Company's cash and cash equivalents and bullion are invested in business accounts or stored with quality financial institutions and are available on demand to fund the Company's operations.

The Company enters into contracts that give rise to commitments in the normal course of business. The following table summarizes the remaining contractual cash flows of the Company's financial liabilities and operating and capital commitments, shown in contractual undiscounted cash flows, at September 30, 2023:

		Less than 1 year			Between 1 - 3 years			Between 4 - 5 years			After 5 years			Total
Accounts payable and accrued liabilities	$	17,296		$	-		$	-		$	-		$	17,296
Tax liabilities		12,474			-			-			-			12,474
Lease liabilities(1)		71			138			87			93			389
Reclamation and closure provision(1)		-			-			-			12,499			12,499
TOTAL	$	29,841		$	138		$	87		$	12,592		$	42,658

⁽¹⁾ Estimated undiscounted cash flows.

The Company believes its cash and cash equivalents at September 30, 2023 of $69,979, bullion of $11,731, undrawn $70,000 Revolving Facility, and continuing revenue and profitable operations are sufficient to settle its commitments through the next 12 months.

Foreign currency risk

The Company operates in Canada and Mexico and is exposed to foreign exchange risk arising from transactions denominated in foreign currencies. The operating results and the financial position of the Company are reported in US$. The functional currency of the parent entity (note 2) and its subsidiaries is US$ and therefore they are exposed to foreign currency risk from financial instruments denominated in currencies other than US$.

The Company is exposed to foreign currency risk through the following financial assets and liabilities, expressed in US$:

		C$			Mexican Peso			Total
September 30, 2023
Cash and cash equivalents	$	9,212		$	306		$	9,518
Accounts receivable		(14	)		14			-
Value-added taxes receivable		47			27,420			27,467
Total financial assets		9,245			27,740			36,985
Less: accounts payable and accrued liabilities		(4,937	)		(5,021	)		(9,958	)
Net financial assets	$	4,308		$	22,719		$	27,027

The Company is primarily exposed to fluctuations in the value of US$ against C$ and US$ against Mexican pesos ("MX$"). With all other variables held constant, a 1% change in US$ against C$ or US$ against MX$ would result in the following impact on the Company's net income for the year:

		September 30, 2023
US$/C$ exchange rate - increase/decrease 1%	$	43
US$/MX$ exchange rate - increase/decrease 1%	$	227

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17. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (continued)

Credit risk

Credit risk is the risk of potential loss to the Company if the counterparty to a financial instrument fails to meet its contractual obligations. The Company's credit risk is primarily attributable to its liquid financial assets including cash and cash equivalents and accounts receivable.

The Company limits exposure to credit risk on liquid financial assets through maintaining its cash and cash equivalents and bullion with high-credit quality financial institutions. From time to time, the Company will have certain liquid financial assets on deposit with or held by multiple high-credit quality financial institutions as a risk mitigation practice. The Company's cash and cash equivalents are on deposit with The Bank of Montreal ("BMO") and The Bank of Novia Scotia ("BNS") in Canada and BNS in Mexico. Bullion is stored with BMO in Canada. The Company has not recognized any expected credit losses with respect to interest receivable as the amounts are due from high-credit quality financial institutions and the risk of default is considered negligible. The carrying amount of financial assets, as stated in the consolidated statement of financial position, represents the Company's maximum credit exposure.

Precious metal price risk

The Company is exposed to price risk on precious metals that impact the valuation of the Company's derivative positions, comprised of gold and silver call options written, which has a direct and immediate impact on net earnings. The prices of precious metals are volatile and affected by many factors beyond the Company's control, and there can be no assurance that precious metal prices will not be subject to wide fluctuations in the future. A substantial or extended change in precious metal prices could have an adverse effect on the Company's financial position, income, and cash flows.

Interest rate risk

Interest rate risk is the risk that the fair values or future cash flows of the Company's financial instruments will fluctuate because of changes in market interest rates. The Company's exposure to interest rate risk arises primarily from the interest rate impact on its cash and cash equivalents. The Company's cash and cash equivalents are held or invested in highly liquid accounts with both floating and fixed rates of interest, in order to achieve a satisfactory return for shareholders.

At September 30, 2023, the weighted average interest rate earned on the Company's interest-bearing cash and cash equivalents was 5.40%. With all other variables unchanged, a one percentage point change in interest rates would result in approximately a $659 increase/decrease in the Company's income and comprehensive income (loss), annually.

Financial instruments carrying value and fair value

The Company's financial instruments consist of cash and cash equivalents, accounts receivable, and accounts payable and accrued liabilities.

The fair value hierarchy establishes three levels to classify the inputs to valuation techniques used to measure fair value. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices in markets that are not active, quoted prices for similar assets or liabilities in active markets, inputs other than quoted prices that are observable for the asset or liability (for example, interest rate and yield curves observable at commonly quoted intervals, forward pricing curves used to value currency and commodity contracts and volatility measurements used to value option contracts), or inputs that are derived principally from or corroborated by observable market data or other means. Level 3 inputs are unobservable (supported by little or no market activity). The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. The level of measurement for each financial instrument is determined by the lowest level of significant inputs.

The carrying value of accounts receivable and accounts payable and accrued liabilities (except as noted) approximate their fair values due to the short-term nature of these instruments. In relation to the Company's SU plan (note 15), the Company recorded the fair value of SUs in accounts payable and accrued liabilities. The Company also recorded a derivative liability on its call options (note 3) in accounts payable and accrued liabilities. Both of these items are measured using level 2 inputs.

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17. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (continued)

Financial instruments carrying value and fair value (continued)

The following table summarizes the carrying value and fair value, by level, of the Company's financial instruments. It does not include fair value information for financial instruments not measured at fair value if the carrying amount reasonably approximates the fair value because of their short-term nature.

		Carrying value						Fair value
		Fair value through
		profit and loss			Amortized cost			Level 1			Level 2			Level 3
September 30, 2023
Financial assets
Accounts receivable	$	-		$	86		$	-		$	-		$	-
Financial liabilities
Accounts payable and accrued liabilities		(1,973	)		(15,323	)		-			(1,973	)		-
Net financial instruments	$	(1,973	)	$	(15,237	)	$	-		$	(1,973	)	$	-

December 31, 2022
Financial assets
Accounts receivable	$	-		$	179		$	-		$	-		$	-
Financial liabilities
Accounts payable and accrued liabilities		(2,382	)		(15,294	)		-			(2,382	)		-
Debt		-			(49,591	)		-			-			(49,591	)
Net financial instruments	$	(2,382	)	$	(64,706	)	$	-		$	(2,382	)	$	(49,591	)

18. REVISION OF PRIOR PERIOD

Revision of the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023

The Company identified an overstatement of unrealized foreign exchange loss error in the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023, as originally filed. The impact of this error is as follows:

Condensed consolidated interim statements of cash flows for the three and six months ended June 30, 2023

		Three months ended June 30, 2023									Six months ended June 30, 2023
		As previously reported			Effect of revision			As revised			As previously reported			Effect of revision			As revised
CASH FLOWS FROM OPERATING ACTIVITIES
Income for the period	$	23,702		$	-		$	23,702		$	50,867		$	-		$	50,867
Adjustments for:
Foreign exchange loss, unrealized		15,572			(6,990	)		8,582			13,943			(6,990	)		6,953
Cash flow from operating activities before changes in non-cash working capital items		47,475			(6,990	)		40,485			82,992			(6,990	)		76,002
Changes in non-cash working capital items
Value-added taxes receivable		5,475			4,022			9,497			1,433			4,022			5,455
Net cash (used in) provided by operating activities		53,808			(2,968	)		50,840			80,781			(2,968	)		77,813
Effect of foreign exchange on cash and cash equivalents		(5,140	)		2,968			(2,172	)		(2,149	)		2,968			819
Change in cash and cash equivalents, during the period	$	7,648		$	-		$	7,648		$	2,652		$	-		$	2,652

The statement of financial position as of June 30, 2023, including total cash and cash equivalents, and the statement of comprehensive income (loss) for the three and six months ended June 30, 2023, all remained the same as previously reported.

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MANAGEMENT'S DISCUSSION & ANALYSIS

SEPTEMBER 30, 2023

 

 

 

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This Management's Discussion and Analysis ("MD&A") is an overview of all material information about SilverCrest Metals Inc.'s (the "Company" or "SilverCrest") operations, liquidity, and capital resources for the three and nine months ended September 30, 2023. The MD&A should be read in conjunction with the unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2023 and 2022, and the related notes contained therein which have been prepared under International Accounting Standards 34 - Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB"). The following should also be read in conjunction with the audited consolidated financial statements for the years ended December 31, 2022 and 2021, and the related notes contained therein which have been prepared under International Financial Reporting Standards as issued by IASB ("IFRS"). Additional information relating to the Company, including the Company's Annual Information Form for the year ended December 31, 2022 (the "AIF"), is available on SEDAR+ at www.sedarplus.ca, EDGAR at www.sec.gov, and on the Company's website www.silvercrestmetals.com. Readers are cautioned that, unless included in this MD&A, information on the Company's website does not form part of this MD&A.

All amounts are stated in United States dollars ("US$"), and tabular amounts are stated in thousands of United States dollars except for per share amounts, unless otherwise indicated. References to "C$" are to the Canadian dollar and "MX$" are to the Mexican peso. Certain amounts shown in this MD&A may not add exactly to total amounts due to rounding differences. The first, second, third, and fourth quarters of the Company's fiscal years ("FY") are referred to as "Q1", "Q2", "Q3", and "Q4", respectively, and the first and second half of the Company's fiscal years are referred to as "H1" and "H2", respectively. The following are other abbreviations used throughout this MD&A: Au (gold), Ag (silver), oz (ounces), all-in sustaining costs (AISC), gpt (grams per tonne), km (kilometres), and tpd (tonnes per day).

The effective date of this MD&A is November 8, 2023.

QUALIFIED PERSON

Technical information contained in this MD&A has been prepared by or under the supervision of N. Eric Fier, CPG, P.Eng., and Chief Executive Officer of the Company, who is a 'Qualified Person' for the purpose of National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

CAUTIONARY NOTE TO US INVESTORS

This MD&A includes Mineral Resource and Mineral Reserve Estimates classification terms that comply with reporting standards in Canada and the Mineral Resource and Mineral Reserve Estimates are made in accordance with NI 43-101. NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. These standards differ from the requirements of the United States Securities and Exchange Commission (the "SEC") applicable to domestic United States reporting companies. Consequently, Mineral Resource and Mineral Reserve Estimates information included in this MD&A may not be comparable to similar information that would generally be disclosed by United States domestic reporting companies subject to the reporting and disclosure requirements of the SEC. Accordingly, information concerning mineral deposits set forth herein may not be comparable with information made public by companies that report in accordance with US standards.

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FORWARD-LOOKING STATEMENTS

This MD&A contains "forward-looking statements" and "forward-looking information" (collectively, "forward-looking statements") within the meaning of applicable Canadian and United States securities legislation. Such forward-looking statements concern the Company's anticipated results and developments in the Company's operations in future periods, planned exploration and development of its properties, planned expenditures and plans related to its business and other matters that may occur in the future. In addition, these statements include, but are not limited to: the future price of commodities; the estimation of Mineral Resource and Mineral Reserve Estimates; the realization of Mineral Resource and Mineral Reserve Estimates; the timing and amount of estimated future production; costs of production; capital expenditures; costs and timing of the development of new deposits; timing of completion of exploration programs; technical reports and studies; the success of exploration and development activities and mining operations; future financings, the Company's share price and on the timing and completion of exploration programs, the productivity and timing of mine operation activities; permitting timelines; currency fluctuations; requirements for additional capital; government regulation of exploration and production operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; completion of acquisitions and their potential impact on the Company and its operations; limitations on insurance coverage; maintenance of adequate internal control over financial reporting; and the development and advancement of the Company's environmental, social, and corporate governance strategy.

Forward-looking statements are made based upon certain assumptions and other important factors that, while considered reasonable by the Company, are inherently subject to significant business economic, competitive, political and social uncertainties and contingencies. The Company has made assumptions based on many of these factors which include, without limitation: the Company's expectations of future performance, including gold and silver production and planned work programs; present and future business strategies; the environment in which the Company will operate in the future, including the price of gold and silver; currency exchange rates; estimates of capital and operating costs; production estimates; Mineral Resource and Mineral Reserve Estimates, and metallurgical recoveries; and mining operational and development risks. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statements were made.

Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ materially from those expressed or implied by the forward-looking statements, including, without limitation: fluctuating prices and availability of commodities; price inflation of goods and services; the timing and content of work programs; interest rate risks; global market conditions; fluctuations in the Company's share prices; results of exploration activities; the interpretation of drilling results and other geological data; reliability of Mineral Resource and Reserve estimates; receipt, maintenance and security of permits and mineral property titles; enforceability of contractual interests in mineral properties; environmental and other regulatory risks; the effects of climate change; compliance with changing environmental regulations; dependence on local community relationships; risks of local violence; risks related to natural disasters, terrorism, civil unrest, public health concerns (including the impact on operations of health epidemics or outbreaks of communicable diseases such as the COVID-19 pandemic) and other geopolitical uncertainties; reliability of costs estimates; project cost overruns or unanticipated costs and expenses; precious metals price fluctuations; fluctuations in the foreign exchange rate (particularly MX$, C$, and US$); risks associated with taxation in multiple jurisdictions; uncertainty in the Company's ability to fund the exploration and development of its mineral properties or the completion of further exploration programs; uncertainty as to whether the Company's exploration programs will result in the discovery, development or production of commercially viable ore bodies or yield reserves; operational, health and safety risks; infrastructure risks; risks associated with costs of reclamation; development plans and costs differing materially from the Company's expectations; risks and uncertainties related to the timing of mine operation activities; risks related to mineral properties being subject to prior unregistered agreements, transfers, claims, and other defects in title; uncertainty in the ability to obtain financing if required; maintaining adequate internal control over financial reporting; dependence on key personnel; and general market and industry conditions. This list is not exhaustive of the factors that may affect the Company's forward-looking statements.  Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking statements.

The Company's forward-looking statements are based on beliefs, expectations, and opinions of management on the date the statements are made.  While the Company has attempted to identify important factors that could cause actual actions, events, or results to differ from those described in forward-looking statements, there may be factors that cause actions, events, or results not to be as anticipated, estimated, or intended.  The Company undertakes no obligation to update or revise any forward-looking statements included in this MD&A if these beliefs, expectations and opinions or other circumstances should change, except as otherwise required by applicable law.

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TABLE OF CONTENTS

1.	DESCRIPTION OF BUSINESS	5
2.	HIGHLIGHTS	5
3.	DISCUSSION OF LAS CHISPAS OPERATIONS	7
4.	SUMMARY OF QUARTERLY RESULTS	8
5.	RESULTS OF OPERATIONS	9
6.	LIQUIDITY AND CAPITAL RESOURCES OUTLOOK	10
7.	FINANCIAL INSTRUMENTS AND RISK MANAGEMENT	12
8.	RELATED PARTY TRANSACTIONS	13
9.	OUTSTANDING SHARE CAPITAL	14
10.	OFF-BALANCE SHEET ARRANGEMENTS	14
11.	CHANGES IN ACCOUNTING POLICIES	14
12.	RISK FACTORS	14
13.	CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS	15
14.	NON-IFRS FINANCIAL MEASURES	16
15.	INTERNAL CONTROL OVER FINANCIAL REPORTING	19

 

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1.   DESCRIPTION OF BUSINESS

SilverCrest is a Canadian-based precious metals producer headquartered in Vancouver, BC, with an ongoing initiative to increase its asset base by expanding current Mineral Resource and Reserve Estimates, acquiring, discovering and developing high value precious metal projects, and ultimately operating multiple silver-gold mines in the Americas. The Company's principal focus is its Las Chispas Operation ("Las Chispas" or the "Las Chispas Operation"), in Sonora, Mexico.

The Company has a portfolio of four other mineral exploration properties in Sonora, Mexico. Further information regarding the business of SilverCrest, its operations and its mineral properties can be found in the most recent AIF and on the Company's website, www.silvercrestmetals.com; however, only items explicitly incorporated form part of this MD&A whereas items only referred to do not.

The silver equivalent ("AgEq") ratio used in this MD&A of 79.51:1 is based on the results of the Las Chispas Operation Technical Report dated September 5, 2023 with an effective date of July 19, 2023 (the "Report").

2.   HIGHLIGHTS

Q3, 2023 Highlights

● Recovered 15,700 ounces (“oz”) of gold and 1.49 million ounces of silver, or 2.74 million silver equivalent oz¹.

● Sold a total of 14,500 oz of gold and 1.53 million oz of silver at average realized prices² of $1,931 per oz gold and $23.41 per oz silver for a total of 2.68 million oz AgEq sold.

● Revenue of $63.8 million and cost of sales of $26.4 million, resulting in mine operating income of $37.5 million, which represents a 59% operating margin.

● Income of $29.9 million or $0.20 per share.

● Cash flow from operating activities before changes in non-cash working capital items of $40.9 million or $0.28 per share.

● Net free cash flow of $33.4 million or $0.23 per share

● Cash costs² of $6.53 per oz AgEq sold and AISC² of $12.23 per oz AgEq sold are below the low end of H2, 2023 guidance primarily due to higher sales volumes, higher proportion of long hole stopes, and lower capital spend than planned.

● $7.1 million spent under active Normal Course Issuer Bid (“NCIB”) in only 7.5 weeks, representing 20% of the allowable 7.4 million common share limit.

● Ended the quarter debt free with treasury assets² totaling $81.7 million (cash of $70.0 million and gold and silver bullion of $11.7 million).

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Q3, 2023 Highlights Summary

Operational Highlights
	Unit	Q3, 2023	Q2, 2023	YTD, 2023
Ore mined	tonnes	83,800	74,400	222,300
Ore milled(A)	tonnes	114,500	107,900	326,900
Average daily mill throughput	tpd	1,245	1,186	1,197
Gold (Au)
Average processed grade	gpt	4.35	4.84	4.42
Process Recovery	%	98.3	98.4	98.1
Recovered	oz	15,700	16,500	45,600
Sold	oz	14,500	13,400	42,100
Average realized price(B)	$/oz	1,931	1,991	1,933
Silver (Ag)
Average processed grade	gpt	413	449	427
Process Recovery	%	98.1	97.9	96.1
Recovered	million oz	1.49	1.53	4.31
Sold	million oz	1.53	1.45	4.34
Average realized price(B)	$/oz	23.41	24.36	23.60
Silver equivalent (AgEq)
Recovered	million oz	2.74	2.84	7.93
Sold	million oz	2.68	2.52	7.69
Financial Highlights
	Unit	Q3, 2023	Q2, 2023	YTD, 2023
Revenue	$ millions	63.8	62.0	183.8
Cost of sales	$ millions	(26.4)	(23.7)	(72.5)
Mine operating income	$ millions	37.5	38.3	111.4
Income for the period	$ millions	29.9	23.7	80.8
Income per share - basic	$/share	0.20	0.16	0.55
Cash flow from operating activities before changes in non-cash working capital items	$ millions	40.9	40.5	116.9
Net free cash flow(B)(C)	$ millions	33.4	40.7	95.9
Cash costs(B)	$/oz AgEq sold	6.53	7.39	6.81
AISC(B)	$/oz AgEq sold	12.23	12.70	11.97
	Unit	September 30, 2023	June 30, 2023
Cash and cash equivalents	$ millions	70.0	53.4
Bullion	$ millions	11.7	5.6
Treasury assets(B)	$ millions	81.7	59.0
Net cash	$ millions	70.0	53.4

^(A) Ore milled includes material from stockpiles and ore mined.

^(B) Average realized prices, net free cash flow, net cash, treasury assets, cash costs and cash costs per AgEq ounce sold, AISC, and AISC per ounce sold are non-IFRS financial measures. Non-IFRS financial measures are not standardized financial measures under IFRS and might not be comparable to similar financial measures disclosed by other companies. Please refer to the "NON-IFRS FINANCIAL MEASURES" section of this MD&A for additional information.

^(C) Net free cash flow for Q2, 2023 has been revised from the previously reported amount of $43.7 million to $40.7 million. Please see non-IFRS section below for more details.

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3.   DISCUSSION OF LAS CHISPAS OPERATIONS

Underground

Mining rates in Q3, 2023 increased by 11% from Q2, 2023, averaging 911 tpd. The increase was driven by a combination of more long hole stopes being available in cycle than planned and higher localized dilution in the Babicanora Main Vein. It is expected that mining rates in Q4, 2023 will be in the range of 800 to 900 tpd, which is in line with the ramp-up estimate outlined in the Updated Technical Report.

Underground mining contract negotiations continued during the quarter and are targeted to conclude in Q4, 2023, for implementation in H1, 2024.

Processing Plant

Average daily mill throughput increased to 1,245 tpd, above plan for the quarter. It was anticipated that the processing plant may have lower availability in the quarter due to seasonal conditions impacting the power supply, however, this did not materialize allowing for higher average mill throughput than planned. As planned, average processed gold and silver grades declined slightly (10% and 8% respectively) from Q2, 2023.

Financial Position

As of September 30, 2023, the Company had a treasury assets balance of $81.7 million, consisting of $70.0 million in cash and $11.7 million of bullion held at market value at the end of the quarter. The Company remains debt free with access to an undrawn revolving facility of $70.0 million.

During the quarter, $2.7 million in IVA was collected for a total of $16.0 million collected year-to-date. The timing of future IVA collection is uncertain and, as a result, can fluctuate in both size and pace.

Revenue

During Q3, 2023, the Company sold a total of 14,500 oz of gold and 1.53 million oz of silver, at average realized prices of $1,931 per oz gold and $23.41 per oz silver, generating revenue of $63.8 million (Q2, 2023 - $62.0 million). The 3% increase in revenue over Q2, 2023 was primarily attributed to higher sales volume. Total precious metal sales for the first nine months of 2023 of 7.69 million oz AgEq compares favourably to SilverCrest's 2023 guidance of 9.8 to 10.2 million oz AgEq sold.

Costs

In the third quarter, total cost of sales was $26.4 million (Q2, 2023 - $23.7 million), an increase of 11% over Q2, 2023. This increase was primarily due to increased metal sales and the expected increase over time of the weighted average cost per silver equivalent ounce released from ore stockpiles.

During the quarter, cash costs averaged $6.53 per oz AgEq sold. This compares to cash costs of $7.39 per oz AgEq sold in Q2, 2023 and H2, 2023 cash cost guidance of $7.00 to $8.50 per oz AgEq sold. Cash costs decreased due to higher sales volume, higher proportion of long hole stopes, and lower development unit rates.

Corporate Level AISC which aligns with the World Gold Council definition of AISC averaged $12.23 per oz AgEq sold, compared to $12.70 per oz AgEq in Q2, 2023 and H2, 2023 guidance of $13.75 to $15.50 per oz AgEq sold. AISC decreased from Q2, 2023 due to higher sales volume, decreased cash costs and lower capital spending than planned. Capital spending was below plan due to timing of procurement and scope change.

Income

Income for Q3, 2023 was $29.9 million compared to $23.7 million in Q2, 2023, primarily driven by increased revenue from higher volumes and lower unrealized foreign exchange losses.

Year to date income has benefited from the application of net operating losses (tax loss carryforwards) of $71.0 million, which were fully utilized in Q3, 2023. The Company anticipates accruing for income taxes in Q4, 2023 with income going forward subject to Mexico's corporate tax rate of 30%. Payment of the 2023 income taxes, together with Extraordinary and Special Mining Duties, will be due and paid in Q1, 2024. In 2024 and beyond, the Company expects to make quarterly income tax installments and annual payments for the Extraordinary and Special Mining Duties in the first quarter following the year end.

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During Q3, 2023, the Company changed the functional currency of its parent entity from C$ to US$. The Company determined that the US$ better represents the primary economic environment in which the parent entity operates. This change has been accounted for prospectively, which means starting Q3, 2023, the parent entity's functional currency is now the same as the presentation currency of US$ and there is no longer a need to record exchange gain and losses to foreign currency translation reserve as of July 1, 2023.

Sustaining Capital Expenditure

During Q3, 2023, sustaining capital expenditure of $9.8 million was a decrease from Q2, 2023 of $0.3 million and below plan for the quarter. The majority of the decrease from plan can be attributed to delays in procuring key underground materials as well as some slight changes to scope. During the quarter a surface mobile maintenance facility was constructed by SilverCrest to address ongoing mobile maintenance challenges encountered by its underground contractor. The construction of the facility is part of a work plan to improve equipment availability, which is expected to take some time to improve.

The Company anticipates its capital spending at Las Chispas to increase in Q4, 2023 relative to Q3, 2023 and remain within 2023 AISC guidance.

Exploration Update

During the quarter, 14,183 metres of exploration drilling was completed at Las Chispas, with 83% of the metres focused on infill drilling of Inferred Resources (see Updated Technical Report) for conversion to Indicated Resources and ultimately consideration for reserve conversion. The remaining drilling (2,455 metres) was for new vein targets. The exploration budget remains $10 million from Q3, 2023 through the end of Q1, 2024. In Q3, 2023, the Company spent $2.8 million on exploration at Las Chispas.

ESG

In September 2023 the Company signed a collaboration agreement with Comisión Estatal del Agua (CEA) and the municipality of Arizpe to work on agriculture infrastructure, sewage system and water concessions for agricultural use for the local communities, a positive step in the Company's water stewardship plan. This agreement advances continued efforts to help the local communities secure state and federal funding for water related infrastructure to protect livelihoods and create long-term economic resilience. 

Subsequent to the end of the quarter, the Company was awarded two recognitions from the Confederation of Industrial Chambers of the United Mexican States (CONCAMIN) in the areas of Outstanding Practices in the Industry and Ethics and Values.

Guidance

SilverCrest's 2023 production and cost guidance remains unchanged. The Company remains on track to achieve 9.8 to 10.2 million ounces sold for 2023 at average all in sustaining costs within the expected range of $12.75 to $13.75 per oz AgEq sold.

4.   SUMMARY OF QUARTERLY RESULTS

The following table sets out information, derived from the Company's unaudited condensed consolidated interim financial statements prepared in accordance with IAS 34 "Interim Financial Reporting" as issued by the IASB, for each of the eight most recently completed financial quarters:

		Q3, 2023 Sep 30, 2023							Q2, 2023 Jun 30, 2023							Q1, 2023 Mar 31, 2023								Q4, 2022 Dec 31, 2022
		$ 000’s, Except Per Share Amounts
Revenue		$		63,828					$			61,999				$				57,983				$				40,791
Income for the period		$		29,936					$			23,702				$				27,165				$				5,231
Income per common share – basic		$		0.20					$			0.16				$				0.18				$				0.03
Income per common share – diluted		$		0.20					$			0.16				$				0.18				$				0.04

	Q3, 2022 Sep 30, 2022							Q2, 2022 Jun 30, 2022						Q1, 2022 Mar 31, 2022								Q4, 2021 Dec 31, 2021
	$ 000’s, Except Per Share Amounts
Revenue	$		2,719					$			-			$					-			$					-
Income (loss) for the period	$		25,212					$			9,605			$					(8,747		)	$					(7,949		)
Income (loss) per common share – basic	$		0.17					$			0.07			$					(0.06		)	$					(0.06		)
Income (loss) per common share – diluted	$		0.17					$			0.06			$					(0.06		)	$					(0.06		)

The Company started commissioning the Las Chispas process plant during Q2, 2022 and had its first precious metal sales during Q3, 2022. The ramp-up of the process plant operation continued in Q3, 2022 and commercial production was achieved in Q4, 2022. Q1, 2023 was the Company's first full quarter of production.

The primary driver of income between Q4, 2022 to Q3, 2023 was revenue on sales from operations. The primary driver of variances in income between Q4, 2021 and Q3, 2022 was due to foreign exchange gains and losses. These primarily arose on holding foreign currency denominated cash and cash equivalents and translation of foreign currency denominated balances.

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5.   RESULTS OF OPERATIONS

During Q3, 2023, income was $29.9 million, compared to $25.2 million for Q3, 2022. The significant variations between these periods, ranked from largest to smallest, included:

	Three months ending September 30,
	2023		2022		Variance
	$ 000's		$ 000's		$ 000's				Variance explanation
Revenue	$	63,828	$	2,719	$	61,109	The Company had its first metal sales during Q3, 2022 which totaled 140,300 Ag oz sold compared to 14,500 Au oz and 1.5 million Ag oz sold during Q3, 2023. The Company declared commercial production effective November 1, 2022.
Foreign exchange (loss) gain	$	(355)	$	25,681	$	(26,036)	During Q3, 2022, the value of US$ increased, relative to C$ which resulted in realized foreign exchange gains in the parent entity, which had a functional currency of C$ at the time, as it held $76.3 million in US$ denominated cash and cash equivalents at September 30, 2022. During Q3, 2022, the Company recognized unrealized foreign exchange gains resulting from the translation of intercompany balances between the parent entity and its subsidiaries. This was due to the relative appreciation in the value of MX$ to C$ during Q3, 2022. Effective July 1, 2023, the Company determined the parent entity's functional currency had changed from C$ to US$ which resulted in reduced foreign exchange impacts during Q3, 2023.
Cost of sales	$	(26,368)	$	(795)	$	(25,573)	As mentioned previously regarding revenue, Q3, 2023 saw a significant increase in sales volumes compared to Q3, 2022 (increased production). The underground mine remains in a planned ramp-up phase, and the processing plant is currently fed with a mix of ore from stockpiles and run-of-mine. Stockpile inventory that was recorded as cost of sales included ore that was mined prior to the development phase and had previously been expensed as exploration and evaluation expenditures. This lowered the weighted average cost of stockpile inventory in Q3, 2023 and 2022. As a result, the cost of sales are lower than anticipated for steady-state operating costs, and this trend is expected to continue until these stockpiles have been fully processed.
Interest and finance expense	$	(3,502)	$	(65)	$	(3,437)	During Q3, 2023, there was a $3.2 million non-refundable IVA charge incurred in connection with intercompany tax planning. This charge was offset against value-added taxes receivable.
Income tax expense	$	(1,291)	$	-	$	(1,291)	During Q3, 2023, the Company recorded a $2.7 million provision for the 7.5% special mining duty which was estimated to be payable to the Mexican government on gold and silver sales. A portion of this expense was offset by deferred income tax recovery. Corporate taxes from  2023 will be payable in Q1, 2024.
General and administrative expenses	$	(2,772)	$	(1,492)	$	(1,280)	Since the beginning of 2023, the Company began to accrue annual bonuses monthly, which resulted in a comparatively higher expense during Q3, 2023. In addition, after entering commercial production on November 1, 2022, certain remuneration and administrative costs were allocated to general and administrative expenses.
Exploration and evaluation expenditures	$	(250)	$	(1,280)	$	1,030	During Q3, 2023, the Company concentrated its efforts on permitting, access agreements, mapping, and sampling within the unexplored areas of El Picacho for target generation. This contrasts with the same quarter in the previous year, where drilling activities at Picacho spanned 5.5 km and incurred drilling costs of $0.6 million. Consequently, the year-over-year expenditures for Q3, 2023 decreased due to the absence of drilling.

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During the nine months ended September 30, 2023, income was $80.8 million, compared to $26.1 million for the nine months ended September 30, 2022. The significant variations between these periods, ranked from largest to smallest, included:

		Nine months ending September 30,
		2023		2022		Variance
		$ 000's		$ 000's		$ 000's	Variance explanation
Revenue	$	183,810	$	2,719	$	181,091	The Company had its first metal sales during Q3, 2022 which totaled 140,300 Ag oz sold compared to 42,100 Au oz and 4.3 million Ag oz sold during the nine months ended September 30, 2023. The Company declared commercial production effective November 1, 2022.
Cost of sales	$	(72,451)	$	(795)	$	(71,656)	As mentioned previously regarding revenue, the nine months ended September 30, 2023 saw a significant increase in sales volumes compared to the nine months ended September 30, 2022 (increased production). The underground mine remains in a planned ramp-up phase, and the processing plant is currently fed with a mix of ore from stockpiles and run-of-mine. Stockpile inventory that was recorded as cost of sales included ore that was mined prior to the development phase and had previously been expensed as exploration and evaluation expenditures. This lowered the weighted average cost of stockpile inventory in the nine months ended September 30, 2023 and 2022. As a result, the cost of sales are lower than anticipated steady-state operating costs, and this trend is expected to continue until these stockpiles have been fully processed.
Foreign exchange (loss) gain	$	(7,877)	$	32,406	$	(40,283)	During the nine months ended September 30, 2023, the Company recognized unrealized foreign exchange losses resulting from translating foreign currency balances denominated in currencies other than US$. During the nine months ended September 30, 2022, both the US$ and MX$ appreciated relative to the C$ which resulted in unrealized foreign currency gains in the parent entity as its functional currency was C$, at the time.
Income tax (expense) recovery	$	(9,878)	$	57	$	(9,935)	During the nine months ended September 30, 2023, the Company recognized deferred income tax due to unrealized foreign exchange gains on intercompany loan balances. With the initiation of cash repatriation from operations in Mexico to Canada, the likelihood of realizing these foreign exchange gains has increased. During the nine months ended September 30, 2023, the Company also recorded a $7.9 million provision related to the 7.5% special mining duty which was estimated to be payable to the Mexican government on gold and silver sales. Corporate taxes from 2023 will be due and paid in Q1, 2024.
Interest and finance expense	$	(5,539)	$	(192)	$	(5,347)	The Company declared commercial production effective November 1, 2022, and accordingly, began to expense interest costs on debt in the consolidated statement of income and comprehensive income (loss); debt interest costs were previously capitalized during the development stage. During Q3, 2023, there was a $3.2 million non-refundable IVA charge incurred in connection with intercompany tax planning. This charge was offset against value-added taxes receivable.
Exploration and evaluation expenditures	$	(627)	$	(4,669)	$	4,042	During the nine months ended September 30, 2023, the Company concentrated its efforts on permitting, access agreements, mapping, and sampling within the unexplored areas of El Picacho for target generation. This contrasts with the same nine month period of the previous year, where drilling activities at Picacho spanned 26.2 km and incurred drilling costs of $2.4 million. Consequently, the year-over-year expenditures for the nine months ended September 30, 2023 decreased due to the absence of drilling.
General and administrative expenses	$	(8,630)	$	(4,664)	$	(3,966)	Since the beginning of 2023, the Company began to accrue annual bonuses monthly, which resulted in a comparatively higher expense. In addition, after entering commercial production on November 1, 2022, certain remuneration and administrative costs were allocated to general and administrative expenses.

6.   LIQUIDITY AND CAPITAL RESOURCES OUTLOOK

Prior to announcing commercial production in Q4, 2022, the Company had primarily financed its activities through the issuance of common shares and debt. During the three and nine months ended September 30, 2023, the Company generated $63.8 million and $183.8 million in revenue, respectively from its Las Chispas Operation.

Assets

At September 30, 2023, the Company held $70.0 million (December 31, 2022 - $50.8 million) as cash and cash equivalents. The primary factors that contributed to the increase in cash and cash equivalents from December 31, 2022 to September 30, 2023 include:

● $121.0 million (nine months ended September 30, 2022 - $25.1 million used in) provided by operating activities primarily due to income generated from mining operations at Las Chispas offset by the payment of accounts payable, in the normal course of business, as well as;

● $58.6 million (nine months ended September 30, 2022 - $4.7 million) used in financing activities primarily for the early repayment of debt (see "6. Liquidity and Capital Resources Outlook - Liabilities") and the repurchase and cancellation of common shares (for further details on repurchase and cancellation of common shares, please refer to note 15 of the condensed consolidated interim financial statements for the three and nine months ended September 30, 2023); and

● $43.2 million (nine months ended September 30, 2022 - $50.3 million) used in investing activities primarily for sustaining capital investments at the Las Chispas Operation and bullion purchases, partially offset by interest income received.

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As of September 30, 2023, bullion totaled $11.7 million (December 31, 2022 - $Nil), which consisted of gold and silver bars purchased from a bullion bank to hold as treasury assets in accordance with the Company's liquidity management policy. The bullion is held in storage with The Bank of Montreal in Canada. For further details on bullion, please refer to note 3 of the condensed consolidated interim financial statements for the three and nine months ended September 30, 2023.

As of September 30, 2023, inventories totaled $46.5 million (December 31, 2022 - $40.2 million), which consisted of stockpiled ore, work-in-process, finished goods, and material and supplies. The Company did not hold any non-current inventories.

As of September 30, 2023, value-added taxes receivable decreased to $27.5 million (December 31, 2022 - $31.4 million), which consisted primarily of IVA of $27.4 million (December 31, 2022 - $31.4 million) that the Company has paid and is due to be recovered. The Company believes the balance is fully recoverable and has not provided an allowance. As the Company is uncertain of the timing of the recovery of IVA, it has recorded $16.4 million, being the portion of the receivable that it estimates will be received within the next 12 months, as current and the remaining $11.0 million receivable as non-current. The Company received aggregate IVA refunds of $16.0 million during nine months ended September 30, 2023 (first nine months of 2022 - $8.5 million).

As of September 30, 2023, mineral property, plant, and equipment increased to $241.1 million (December 31, 2022 - $228.1 million) as total additions of $34.4 million exceeded depreciation and depletion of $21.1 million. Additions were primarily related to sustaining capital investments at the Las Chispas Operation.

Liabilities

As of September 30, 2023, accounts payable and accrued liabilities amounted to $17.3 million (December 31, 2022 - $17.7 million) and was comprised primarily of various contractual obligations arising in the normal course of business, including the fair value of share units issued and outstanding. For further details on accounts payable and accrued liabilities, please refer to note 6 of the unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2023.

As of September 30, 2023, tax liabilities were $12.5 million (December 31, 2022 - $5.7 million) which were mainly withholding taxes to be paid upon the payment of interest on intercompany loans and 7.5% special mining duty.

As of September 30, 2023, the Company had fully repaid its $50.0 million term loan. Its undrawn $70.0 million revolving credit facility remains available until November 27, 2026 and is available for general corporate purposes.

As of September 30, 2023, the reclamation and closure provision increased to $5.6 million (December 31, 2022 - $4.6 million), which is the present value of estimated future net cash outflows to rehabilitate the Las Chispas Operation for currently existing disturbances. The undiscounted value of the reclamation and closure provision is estimated to be $12.5 million (December 31, 2022 - $11.2 million). The undiscounted value of the reclamation and closure provision as of September 30, 2023 is based on a cost estimate of $8.7 million, an increase of $1.9 million from the closure costs discussed in the Report. The increase was driven by changes in foreign exchange rate assumptions and additions in closure plans not included in the conceptual closure plan of the Report. An inflation rate of 4.5% per annum was applied to arrive at the estimated future value of the provision. Most of the expenditures are expected to occur in 2030 and 2032.

Liquidity outlook and risks

The Company began generating revenue during Q3, 2022 with the startup and commissioning of the Las Chispas Operation and declared commercial production during Q4, 2022. Management believes its liquidity as at the date of this MD&A together with future revenues, and continued access to its undrawn $70.0 million revolving credit facility will be sufficient to fund its operating activities and provide general corporate purpose needs beyond the next 12 months. The Company's financial condition is dependent on its ability to operate Las Chispas. To facilitate the management of its capital requirements, the Company prepares annual expenditure budgets, which are revised periodically based on projected production and the results of its exploration and operational activities, availability of financing, and industry conditions. For discussion of the Company's outlook on production and costs for the remainder of the year, refer to the Guidance section above.

The impact of inflation on the Company's financial position and operating performance over the next 12 months cannot be determined with any degree of certainty due to a number of factors outside of the Company's control. The Company attempts to mitigate inflationary risks through various strategies including, but not limited to, continuous balance sheet management.

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Commitments and contractual obligations

The Company occasionally will enter certain long-term leases as a lessee. Where they are not considered low value leases, the Company will recognize an asset and a liability in its consolidated statement of financial position.  As at September 30, 2023, the Company had total lease liabilities of $0.3 million (December 31, 2022 - $0.4 million) of which $0.1 million (December 31, 2022 - $0.1 million) was a current liability.

The Company has certain 20-year lease agreements relating to the lease of surface rights so that the Company can pass over areas of land to access both its Las Chispas and Picacho properties. Annual surface right payments total $0.4 million.

The Company enters into contracts that give rise to commitments in the normal course of business. The following table summarizes the remaining contractual cash flows of the Company's financial liabilities and contractual obligations shown in contractual undiscounted cash flows, at September 30, 2023:

		Less than 1 year			Between 1 - 3 years			Between 4 - 5 years			After
											5 years			Total
		$ 000's			$ 000's			$ 000's			$ 000's			$ 000's
Accounts payable and accrued liabilities	$	17,296		$	-		$	-		$	-		$	17,296
Tax liabilities		12,474			-			-			-			12,474
Purchase obligation		58			-			-			-			58
Lease liabilities		71			138			87			93			389
Reclamation and closure provision(1)		-			-			-			12,499			12,499
TOTAL	$	29,899		$	138		$	87		$	12,592		$	42,716

⁽¹⁾ Estimated undiscounted cash flows.

7.   FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The Company's financial instruments consist of cash and cash equivalents, accounts receivable, and accounts payable and accrued liabilities. The carrying value of accounts receivable and accounts payable and accrued liabilities (except as noted) approximate their fair values due to the short periods until settlement. The Company's accounts payable and accrued liabilities related to deferred share units ("DSUs"), restricted share units ("RSUs") and performance share units ("PSUs") are measured using level 2 inputs. The Company also recorded a derivative liability on its call options in accounts payable and accrued liabilities and this derivative liability is measured using level 2 inputs. The Company is exposed to various financial instrument risks and assesses the impact and likelihood of this exposure. These risks include liquidity, foreign currency, credit, commodity price, and interest rate risks. Where material, these risks are reviewed and monitored by the Board of Directors. Foreign currency risk is described below, and for further details on these risks, please refer to note 17 of the unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2023.

Foreign currency risk

The Company operates in Canada and Mexico and is exposed to foreign exchange risk arising from transactions denominated in foreign currencies. The operating results and the financial position of the Company are reported in US$. The functional currency of the parent entity and the Company's subsidiaries is US$ and therefore the Company is exposed to foreign currency risk from financial instruments denominated in currencies other than US$. In addition to the financial instruments identified in accordance with IFRS 9 - Financial Instruments as summarized in the table below, the Company holds value added taxes receivable which are denominated in MX$ which are subject to foreign currency fluctuations.

The Company is exposed to foreign currency risk through the following financial assets and liabilities, expressed in US$:

		C$			MX$			Total
		$ 000's			$ 000's			$ 000's
September 30, 2023
Cash and cash equivalents	$	9,212		$	306		$	9,518
Accounts receivable		(14	)		14			-
Value-added taxes receivable		47			27,420			27,467
Total financial assets		9,245			27,740			36,985
Less: accounts payable and accrued liabilities		(4,937	)		(5,021	)		(9,958	)
Net financial assets	$	4,308		$	22,719		$	27,027

The Company is primarily exposed to fluctuations in the value of US$ against C$ and US$ against MX$. With all other variables held constant, a 1% change in US$ against C$ and US$ against MX$ would result in the following impact on the Company's net income for the year:

		September 30, 2023
		$ 000's
US$/C$ exchange rate - increase/decrease 1%	$	43
US$/MX$ exchange rate - increase/decrease 1%	$	227

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Precious metal price risk

The Company is exposed to price risk on precious metals that impact the valuation of the Company's derivative positions, comprised of gold and silver call options written and put options purchased, which have a direct and immediate impact on the value of certain financial assets, financial liabilities, and net earnings. These options give rise to a derivative liability, and all derivative liabilities are included in accounts payable and accrued liabilities. The prices of precious metals are volatile and affected by many factors beyond the Company's control, and there can be no assurance that commodity prices will not be subject to wide fluctuations in the future. A substantial or extended change in commodity prices could have an adverse effect on the Company's financial position, income, and cash flows.

8.   RELATED PARTY TRANSACTIONS

Professional fees

The Company had the following transactions with Koffman Kalef LLP, a law firm of which the Company's Corporate Secretary is a partner.

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
		$ 000's			$ 000's
Professional fees - expense	$	129		$	82
		September 30, 2023			December 31, 2022
		$ 000's			$ 000's
Payable to Koffman Kalef LLP	$	7		$	12

Key management compensation

The Company's key management personnel have authority and responsibility for planning, directing, and controlling the activities of the Company and comprise the Company's Chief Executive Officer ("CEO"), President, Chief Financial Officer ("CFO"), Chief Operating Officer ("COO"), and directors. Key management personnel compensation is summarized as follows:

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
		$ 000's			$ 000's
Salaries, short-term incentives, management fees, and directors' fees (1)	$	2,479		$	1,160
Share-based compensation(2)	$	647		$	793
	$	3,126		$	1,953

⁽¹⁾  Salaries, short-term incentives, management fees, and directors' fees include remuneration and short-term benefits paid to the President, CFO, COO, and directors. The management fees were paid to a company controlled by the CEO.

⁽²⁾  Share-based compensation includes amounts recorded for stock options, DSUs, RSUs, and PSUs. Please see note 15 of the unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2023 for further details.

Other transactions

• The Company has an allocation of costs agreement with Goldsource Mines Inc. ("Goldsource"), a company related by common directors and officers (N. Eric Fier, Bernard Poznanski, and Graham Thody), whereby the Company shares salaries, administrative services, and other expenses. Amounts allocated to Goldsource are due at the end of each fiscal quarter and accrue interest at a rate of 1% per month, if in arrears for greater than 30 days.

		Nine months ended September 30, 2023			Nine months ended September 30, 2022
		$ 000's			$ 000's
Costs allocated to Goldsource	$	40		$	53

		September 30, 2023			December 31, 2022
		$ 000's			$ 000's
(Payable to) receivable from Goldsource	$	(14	)	$	19

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9.   OUTSTANDING SHARE CAPITAL

As of November 8, 2023, the Company had the following common shares, options and share units issued and outstanding:

Security	C$ per share	Expiry	Issued and Outstanding
Common Shares			145,808,364
Options(1)	C$3.24 - C$12.63	Dec 14, 2023 - Dec 16, 2027	5,365,450
DSUs, RSUs and PSUs(1)(2)			488,374
Fully Diluted			151,662,188

(1) Each option is convertible or exchangeable into one common share of the Company. The Board of Directors may elect one or any combination of the following settlement methods for the settlement of DSUs, RSUs and PSUs: issuing shares from treasury, causing a broker to purchase shares on the TSX; and/or paying cash. Where settlement through shares is chosen, each DSU, RSU and PSU is convertible or exchangeable into one common share of the Company.

(2) This excludes 132,000 DSUs that were outstanding at September 30, 2023, as they are to be settled in cash.

Under SilverCrest's NCIB program, expiring August 13, 2024, 5,858,663 common shares remain available to purchase.

10.  OFF-BALANCE SHEET ARRANGEMENTS

As of September 30, 2023, the Company had no off-balance sheet arrangements.

11.  CHANGES IN ACCOUNTING POLICIES

During the nine months ended September 30, 2023, the Company adopted an accounting policy relating to its bullion holdings. Bullion is initially recorded at cost on acquisition and subsequently measured at fair value at the end of each reporting period. Changes in the fair value are recognized in the period the changes occur. These changes are recorded to interest and investment income in the consolidated statements of income and comprehensive income (loss). See note 3 of the condensed consolidated interim financial statements for the three and nine months ended September 30, 2023 for further details.

During the nine months ended September 30, 2023, the Company adopted the IASB published amendments to IAS 12 - Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction. The Company concluded that the adoption of the amendments had no significant impact on its interim condensed consolidated financial statements.

12.  RISK FACTORS

Besides the risks discussed elsewhere in this MD&A, there are other risks and uncertainties that have affected the Company's financial statements or that may affect them in the future. See "Risk Factors" in the Company's Annual Information Form for the year ended December 31, 2022 for other risks affecting or that could potentially affect the Company.

● Activities of the Company may be impacted by public health crises;

● The Company's exploration, development, and mining activities are subject to foreign currency exchange fluctuations which could result in foreign exchange losses;

● Precious metal prices and the fair value of bullion held are subject to wide fluctuations;

● The Company is subject to assessment by taxation authorities in multiple jurisdictions that arise in the ordinary course of business;

● Interest rate and inflation risks;

● Economic conditions for mining; and

● The Company may not be successful in maintaining internal control over financial reporting.

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13.  CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The preparation of consolidated financial statements in accordance with IFRS requires management to make judgments, estimates, and assumptions that affect the reported amounts and the valuation of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenditures during the year. These judgments and estimates are continuously evaluated and are based on management's experience and knowledge of the relevant facts and circumstances. Actual results may differ from the estimates. Revisions to estimates and the resulting effects on the carrying amounts of the Company's assets and liabilities are accounted for prospectively. Information about such judgments and estimates is contained in note 3 to the audited consolidated financial statements for the year ended December 31, 2022. Management has made the following critical estimates and judgments:

Recoverable value of and impairment of non-current assets

Management must determine whether or not indicators of impairment are present and when indicators of impairment are present, estimate the recoverable value of the Company's non-current assets.

Functional currency

The functional currency for an entity is the currency of the primary economic environment in which the entity operates. The Company has determined the functional currency of the parent entity and its subsidiaries to be US$. Previously, the functional currency of the parent entity was C$ but effective July 1, 2023, the Company determined it was US$. Determination of functional currency may involve certain judgments to determine the primary economic environment, and the Company reconsiders the functional currency of its entities if there is a change in events and conditions which determine the primary economic environment.

Mineral Reserve Estimate and the Life of Mine plan

The Company estimates its Mineral Reserve Estimate in accordance with the requirements of National Instrument 43-101. Estimates of the quantities of the Mineral Reserve Estimate form the basis for the Company's life of mine plans, which are used for the calculation of depletion expense under the units of production method, impairment tests, and forecasting the timing of the payments related to the environmental reclamation provision.

Share-based payments

The Company uses the Black-Scholes model to value share-based payments related to stock options. The option valuation model requires the input of highly subjective assumptions including the expected stock price volatility. Because the Company's stock options have characteristics significantly different from those of traded options and because the subjective input assumptions can materially affect the calculated fair value, such value is subject to measurement uncertainty.

Collectability and classification of IVA recoverable

IVA recoverable is collectible from the government of Mexico. The collection of IVA is subject to a complex application and collection process and therefore, there is risk related to the collectability and timing of payment from the Mexican government. The Company uses its best estimates based on the facts known at the time and its experience to determine its best estimate of the collectability and timing of these recoveries. Changes in the assumptions regarding collectability and the timing of collection could impact the valuation and classification as a current or non-current asset associated with IVA recoverable.

Inventories valuation and cost

The measurement of inventories, including the determination of its net realizable market value ("NRV"), especially as it relates to metal processing inventory involves the use of estimates.

Las Chispas has mineral stockpiles that are valued at the lower of weighted average cost and NRV. This is the same for work-in-process and finished goods. NRV is calculated as the estimated price at the time of sale based on prevailing and long-term metal prices less estimated future costs to convert the inventories into saleable form and estimated costs to sell, discounted where applicable. In determining the value of these stockpiles, the Company makes estimates of tonnages, grades, and the recoverability of ore in these stockpiles to estimate its value. Changes in these estimates can result in a change in carrying amounts of inventory, which could result in charges to cost of sales. The determination of forecast sales prices, recovery rates, grade, assumed contained metal in stockpiles, work-in-process and processing and selling costs all requires significant assumptions that impact the carrying value of inventories.

The cost of inventories include:

● Mining costs incurred in production such as labour, material costs, and depreciation and depletion;

● Mining overhead is allocated to inventory based on a monthly allocation prepared by the Company; and

● Indirect and plant costs that are attributed to mining production.

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Estimate of reclamation and closure cost provision

The Company's provision for reclamation and closure costs represents management's best estimate of the present value of the future cash outflows required to settle the liability which reflects estimates of future costs, the timing of the cash flows associated with the future costs, inflation, and movements in foreign exchange rates when liabilities are anticipated to be settled in a currency other than US$. Cost estimates can vary in response to many factors including changes to the relevant legal requirements, whether closure plans achieve intended reclamation goals, the emergence of new restoration techniques, or experience at other mine sites, local inflation rates, and foreign exchange rates. Future changes to environmental laws and regulations could increase the extent of reclamation and rehabilitation work required to be performed by the Company. Increase in future costs could materially impact the amounts charged to operations for reclamation and closure. The expected timing of expenditures can also change, for example, in response to changes in Mineral Reserve Estimate, production rates, or economic conditions. The Company's assumptions are reviewed at the end of each reporting period and adjusted to reflect management's current best estimate and changes in any of the aforementioned factors can result in a material change to the provision recognized by the Company.

14.  NON-IFRS FINANCIAL MEASURES

SilverCrest uses certain non-IFRS performance measures in this MD&A. Non-IFRS financial measures do not have any standardized meaning under IFRS and may not be comparable to similar measures presented by other issuers. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, management and certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Non-IFRS financial measures - Average realized gold and silver price

Average realized gold and silver price per ounce is calculated by dividing the Company's gross revenue from gold or silver sales for the relevant period by the gold or silver ounces sold, respectively. The Company believes the measure is useful in understanding the metal prices realized by the Company throughout the period. Average realized price per ounce sold is a common performance measure that does not have any standardized meaning. The most directly comparable measure prepared in accordance with IFRS is revenue from gold and silver sales.

($ 000's, except per ounce amounts)		Q3, 2023	Q2, 2023	Q3, 2023 YTD
Revenues from financial statements		$      63,828	$      61,999	$    183,810
Ag sales		(35,823)	(35,319)	(102,449)
Au sales	A	28,005	26,680	81,361
Au oz sold during the period	B	14,500	13,400	42,100
Average realized Au price per oz sold	A/B	$        1,931	$        1,991	$        1,933
Revenues from financial statements		63,828	61,999	183,810
Au sales		(28,005)	(26,680)	(81,361)
Ag sales	A	35,823	35,319	102,449
Ag oz sold during the period	B	1,530,000	1,450,000	4,341,000
Average realized Ag price per oz sold	A/B	$        23.41	$        24.36	$        23.60

Non-IFRS financial measure - Net free cash flow

Net free cash flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS. SilverCrest calculates net free cash flow by deducting expenditures on mineral property, plant, and equipment from net cash provided by operating activities. Non-sustaining and growth capital activities are excluded. Net free cash flow is divided by the basic weighted average shares outstanding to get the net free cash flow per basic share. The Company believes that this measure provides valuable assistance to investors and analysts in evaluating the Company's ability to generate cash flow after capital investments and build the cash resources of the Company. The most directly comparable measure prepared in accordance with IFRS is net cash provided by operating activities less net cash used in investing activities. This differs from the Company's calculation as net cash used in investing activities is used in place of expenditures on mineral property, plant, and equipment. Net cash used in investing activities would include all cash inflows and outflows related to investing activities as per the consolidated statement of cash flows.

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Net free cash flow ($ 000's)		Q3, 2023	Q2, 2023(1)	Q3, 2023 YTD
Cash flow from operating activities		43,220	50,840	121,032
Sustaining capital expenditures		(9,836)	(10,103)	(25,120)
Net free cash flow at mine level	A	33,384	40,737	95,912
Weighted average shares outstanding - basic	B	146,776	147,231	147,067
Net free cash flow - basic per share	A/B	0.23	0.28	0.65

⁽¹⁾ The Q2, 2023 cash flow from operating activities figure was revised, as detailed below.

Sustaining capital expenditures ($ 000's)	Q3, 2023	Q2, 2023	Q3 2023 YTD
Expenditures on mineral property, plant, and equipment	(13,081)	(12,919)	(33,930)
Payment of lease liabilities	(11)	(28)	(82)
Non-sustaining and growth capital activities	3,256	2,844	8,892
Sustaining capital expenditures	(9,836)	(10,103)	(25,120)

Revision of the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023

The Company identified an overstatement of unrealized foreign exchange loss error in the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023, as originally filed. The impact of this error is as follows:

		Three months ended June 30, 2023										Six months ended June 30, 2023
		As previously reported			Effect of revision			As revised				As previously reported			Effect of revisions			As revised
CASH FLOWS FROM OPERATING ACTIVITIES
Income for the period	$	23,702		$	-		$	23,702			$	50,867		$	-		$	50,867
Adjustments for:
Foreign exchange loss, unrealized		15,572			(6,990	)		8,582				13,943			(6,990	)		6,953
Cash flow from operating activities before changes in non-cash working capital items		47,475			(6,990	)		40,485				82,992			(6,990	)		76,002
Changes in non-cash working capital items
Value-added taxes receivable		5,475			4,022			9,497				1,433			4,022			5,455
Net cash (used in) provided by operating activities		53,808			(2,968	)		50,840				80,781			(2,968	)		77,813
Effect of foreign exchange on cash and cash equivalents		(5,140	)		2,968			(2,172	)			(2,149	)		2,968			819
Change in cash and cash equivalents, during the period	$	7,648		$	-		$	7,648			$	2,652		$	-		$	2,652

The statement of financial position as of June 30, 2023, including total cash and cash equivalents, and the statement of comprehensive income (loss) for the three and six months ended June 30, 2023, all remained the same as previously reported.

Non-IFRS financial measure - Net cash

SilverCrest calculates net cash by deducting debt from cash and cash equivalents as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, net cash is useful to evaluate its liquidity and capital resources.

Net Cash		September 30, 2023			June 30, 2023			December 31, 2022
		$ 000's			$ 000's			$ 000's
Cash and cash equivalents		69,979			53,413			50,761
Debt		-			-			(49,591	)
Net cash		69,979			53,413			1,170

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Non-IFRS financial measure - Treasury assets

SilverCrest calculates treasury assets as cash and cash equivalents plus bullion as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, treasury assets are useful to evaluate its liquidity and capital resources.

Treasury assets		September 30, 2023			June 30, 2023			December 31, 2022
		$ 000's			$ 000's			$ 000's
Cash and cash equivalents		69,979			53,413			50,761
Bullion		11,731			5,634			-
Treasury Assets		81,710			59,047			50,761

Non-IFRS financial measure - Cash costs and cash costs per silver equivalent ounce sold

The Company uses cash costs per ounce of precious metals sold to monitor its operating performance internally. The most directly comparable measure prepared in accordance with IFRS is cost of sales. The Company believes this measure provides investors and analysts with useful information about its underlying cash costs of operations. The Company also believes it is a relevant metric used to understand its operating profitability and ability to generate cash flow. Cash costs are measures developed by precious metals companies in an effort to provide a comparable standard; however, there can be no assurance that the Company's reporting of these non-IFRS financial measures are similar to those reported by other mining companies. They are widely reported in the silver mining industry as a benchmark for performance, but do not have a standardized meaning and are disclosed in addition to IFRS financial measures. Cash costs include production costs, refinery and transportation costs, and extraordinary mining duty. Cash costs excludes non-cash depreciation and depletion and site share-based compensation.

Cash costs per silver equivalent ounce sold is calculated by dividing cash costs by the silver equivalent ounces sold.

Non-IFRS financial measure - AISC and AISC per silver equivalent ounce sold

The Company defines AISC as the sum of total cash costs (as defined above); general and administrative expenses; share-based compensation; reclamation and closure provision depletion and accretion related to current operations; sustaining capital expenditures relating to current operations, including underground mine development and exploration and evaluation costs; and payments for leases. Corporate and allocated general and administrative expenses do not include non-cash depreciation. As this measure seeks to reflect the full cost of silver equivalent production from current operations, growth capital is excluded. Certain other cash expenditures, including tax payments and financing charges are also excluded. There are some slight differences in the way that Cash Costs and AISC were calculated in the Report compared to the Company's definitions as the Report looks at the standalone operation. The Report includes 7.5% mining royalty (treated as an income tax under IFRS) but excluded corporate and allocated general and administrative expenses and share-based compensation.

($ 000's, except per ounce amounts)		Q3, 2023			Q2, 2023			Q3 2023 YTD
Cost of sales from financial statements	$	26,368		$	23,706		$	72,451
Less: depreciation and depletion		(6,322	)		(4,990	)		(15,356	)
Less: changes in inventories		(1,662	)		877			(1,691	)
Less: corporate salaries and other expenses (including site share-based compensation)		(855	)		(1,003	)		(3,021	)
Total cash costs		17,529			18,590			52,383
Add: sustaining capital expenditures		9,836			10,103			25,120
Add: reclamation and closure provision - depletion and accretion		132			225			556
Add: changes in inventories		1,662			(877	)		1,691
Add: corporate general and administrative expenses (including share-based compensation)		2,808			2,894			9,222
Add: corporate salaries and other expenses (including share-based compensation)		855			1,003			3,021
Total all-in sustaining costs	$	32,822		$	31,938		$	91,993
AgEq koz sold (79.51:1)		2,683			2,515			7,688
Total cash costs per oz sold	$	6.53		$	7.39		$	6.81
All-in sustaining costs per oz sold	$	12.23		$	12.70		$	11.97

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15.  INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with IFRS. The design of any system of controls and procedures is based in part upon certain assumptions about the likelihood of future events. Therefore, even those systems determined effective can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

There have been no significant changes in the Company's internal control over financial reporting during the nine months ended September 30, 2023, that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

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Form 52-109F2

Certification of Interim Filings

Full Certificate

I, N. Eric Fier, Chief Executive Officer of SilverCrest Metals Inc., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of SilverCrest Metals Inc. (the "issuer") for the interim period ended September 30, 2023.

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

5. Design:  Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control framework:  The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Internal Control - Integrated Framework (2013) (COSO Framework) published by The Committee of Sponsoring Organizations of the Treadway Commission (COSO).

5.2 ICFR - material weakness relating to design: N/A

5.3 Limitation on scope of design:  N/A

1

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6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on July 1, 2023 and ended on September 30, 2023 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: November 8, 2023

"N. Eric Fier"

_______________________

N. Eric Fier

Chief Executive Officer

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Form 52-109F2

Certification of Interim Filings

Full Certificate

I, Anne Yong, Chief Financial Officer of SilverCrest Metals Inc., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of SilverCrest Metals Inc. (the "issuer") for the interim period ended September 30, 2023.

2.  No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

5. Design:  Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control framework:  The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Internal Control - Integrated Framework (2013) (COSO Framework) published by The Committee of Sponsoring Organizations of the Treadway Commission (COSO).

5.2 ICFR - material weakness relating to design: N/A

5.3 Limitation on scope of design:  N/A

1

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6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on July 1, 2023 and ended on September 30, 2023 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: November 8, 2023

"Anne Yong"

_______________________

Anne Yong

Chief Financial Officer

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SilverCrest Reports Third Quarter 2023 Results

On Track to Meet 2023 Guidance

TSX: SIL | NYSE American: SILV

For Immediate Release

VANCOUVER, BC - November 8, 2023 - SilverCrest Metals Inc. ("SilverCrest" or the "Company") is pleased to announce its financial results for the third quarter of 2023 ("Q3, 2023"). This release also provides additional operational results, expanding on the October 10, 2023 release of Q3, 2023 operational results from the Company's Las Chispas operation ("Las Chispas" or the "Operation") located in Sonora, Mexico. All amounts herein are presented in United States Dollars ("US$"), unless otherwise stated. Certain amounts shown in this news release may not total to exact amounts due to rounding differences.

N. Eric Fier, CEO, commented, "Las Chispas delivered another quarter of strong operational results and remains on pace to meet 2023 sales and cost guidance. Operating margins of nearly 60% contributed to significant free cash flow in the quarter, allowing for capital allocation flexibility which we used to opportunistically explore, buyback shares, and increase our bullion holdings. Reflecting the strength of our operations, our total treasury assets increased by 38% in the quarter to $81.7 million including $11.7 million of bullion. In the current market where the cost of and access to capital is challenging, our ability to remain flexible and opportunistic is a unique advantage."

Q3, 2023 Highlights

● Recovered 15,700 ounces ("oz") of gold and 1.49 million ounces of silver, or 2.74 million silver equivalent ("AgEq") ounces¹.

● Sold a total of 14,500 oz of gold and 1.53 million oz of silver at average realized prices² of $1,931 per oz gold and $23.41 per oz silver for a total of 2.68 million oz AgEq sold.

● Revenue of $63.8 million and cost of sales of $26.4 million, resulting in mine operating income of $37.5 million, which represents a 59% operating margin.

● Income of $29.9 million or $0.20 per share.

● Cash flow from operating activities before changes in non-cash working capital items of $40.9 million or $0.28 per share.

● Net free cash flow of $33.4 million or $0.23 per share

● Cash costs² of $6.53 per oz AgEq sold and all-in sustaining cost ("AISC")² of $12.23 per oz AgEq sold are below the low end of H2, 2023 guidance primarily due to higher sales volumes, higher proportion of long hole stopes, and lower capital spend than planned.

● $7.1 million spent under active Normal Course Issuer Bid ("NCIB") in only 7.5 weeks, representing 20% of the allowable 7.4 million common share limit.

● Ended the quarter debt free with treasury assets² totaling $81.7 million (cash of $70.0 million and gold and silver bullion of $11.7 million).

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Q3, 2023 Highlights Summary

Operational Highlights
	Unit		Q3, 2023	Q2, 2023	YTD, 2023
Ore mined	tonnes		83,800	74,400	222,300
Ore milled(A)	tonnes		114,500	107,900	326,900
Average daily mill throughput	tpd		1,245	1,186	1,197
Gold (Au)
Average processed grade	gpt		4.35	4.84	4.42
Process Recovery	%		98.3	98.4	98.1
Recovered	oz		15,700	16,500	45,600
Sold	oz		14,500	13,400	42,100
Average realized price(B)	$/oz		1,931	1,991	1,933
Silver (Ag)
Average processed grade	gpt		413	449	427
Process Recovery	%		98.1	97.9	96.1
Recovered	million oz		1.49	1.53	4.31
Sold	million oz		1.53	1.45	4.34
Average realized price(B)	$/oz		23.41	24.36	23.60
Silver equivalent (AgEq)
Recovered	million oz		2.74	2.84	7.93
Sold	million oz		2.68	2.52	7.69
Financial Highlights
	Unit		Q3, 2023	Q2, 2023	YTD, 2023
Revenue	$ millions		63.8	62.0	183.8
Cost of sales	$ millions		(26.4)	(23.7)	(72.5)
Mine operating income	$ millions		37.5	38.3	111.4
Income for the period	$ millions		29.9	23.7	80.8
Income per share - basic	$/share		0.20	0.16	0.55
Cash flow from operating activities before changes in non-cash working capital items	$ millions		40.9	40.5	116.9
Net free cash flow(B)(C)	$ millions		33.4	40.7	95.9
Cash costs(B)	$/oz AgEq sold		6.53	7.39	6.81
AISC(B)	$/oz AgEq sold		12.23	12.70	11.97
	Unit		September 30, 2023	June 30, 2023
Cash and cash equivalents	$ millions		70.0	53.4
Bullion	$ millions		11.7	5.6
Treasury assets(B)	$ millions		81.7	59.0
Net cash	$ millions		70.0	53.4

^(A) Ore milled includes material from stockpiles and ore mined.

^(B) Average realized prices, net free cash flow, net cash, treasury assets, cash costs and cash costs per AgEq ounce sold, AISC, and AISC per ounce sold are non-IFRS financial measures. Non-IFRS financial measures are not standardized financial measures under IFRS and might not be comparable to similar financial measures disclosed by other companies. Please refer to the "NON-IFRS FINANCIAL MEASURES" section of this news release for additional information.

^(C) Net free cash flow for Q2, 2023 has been revised from the previously reported amount of $43.7 million to $40.7 million. Please see non-IFRS section below for more details

Underground

Mining rates in Q3, 2023 increased by 11% from Q2, 2023, averaging 911 tonnes per day ("tpd"). The increase was driven by a combination of more long hole stopes being available in cycle than planned and higher localized dilution in the Babicanora Main Vein. It is expected that mining rates in Q4, 2023 will be in the range of 800 to 900 tpd, which is in line with the ramp-up estimate outlined in the Updated Technical Report.

Underground mining contract negotiations continued during the quarter and are targeted to conclude in Q4, 2023, for implementation in H1, 2024.

Processing Plant

Average daily mill throughput increased to 1,245 tpd, above plan for the quarter. It was anticipated that the processing plant may have lower availability in the quarter due to seasonal conditions impacting the power supply, however, this did not materialize allowing for higher average mill throughput than planned. As planned, average processed gold and silver grades declined slightly (10% and 8% respectively) from Q2, 2023.

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Financial Position

As of September 30, 2023, the Company had a treasury assets balance of $81.7 million, consisting of $70.0 million in cash and $11.7 million of bullion held at market value at the end of the quarter. The Company remains debt free with access to an undrawn revolving facility of $70.0 million.

During the quarter, $2.7 million in IVA was collected for a total of $16.0 million collected year-to-date. The timing of future IVA collection is uncertain and, as a result, can fluctuate in both size and pace.

Revenue

During Q3, 2023, the Company sold a total of 14,500 oz of gold and 1.53 million oz of silver, at average realized prices of $1,931 per oz gold and $23.41 per oz silver, generating revenue of $63.8 million (Q2, 2023 - $62.0 million). The 3% increase in revenue over Q2, 2023 was primarily attributed to higher sales volume. Total precious metal sales for the first nine months of 2023 of 7.69 million oz AgEq compares favourably to SilverCrest's 2023 guidance of 9.8 to 10.2 million oz AgEq sold.

Costs

In the third quarter, total cost of sales was $26.4 million (Q2, 2023 - $23.7 million), an increase of 11% over Q2, 2023. This increase was primarily due to increased metal sales and the expected increase over time of the weighted average cost per silver equivalent ounce released from ore stockpiles.

During the quarter, cash costs averaged $6.53 per oz AgEq sold. This compares to cash costs of $7.39 per oz AgEq sold in Q2, 2023 and H2, 2023 cash cost guidance of $7.00 to $8.50 per oz AgEq sold. Cash costs decreased due to higher sales volume, higher proportion of long hole stopes, and lower development unit rates.

Corporate Level AISC which aligns with the World Gold Council definition of AISC averaged $12.23 per oz AgEq sold, compared to $12.70 per oz AgEq in Q2, 2023 and H2, 2023 guidance of $13.75 to $15.50 per oz AgEq sold. AISC decreased from Q2, 2023 due to higher sales volume, decreased cash costs and lower capital spending than planned. Capital spending was below plan due to timing of procurement and scope change.

Income

Income for Q3, 2023 was $29.9 million compared to $23.7 million in Q2, 2023, primarily driven by increased revenue from higher volumes and lower unrealized foreign exchange losses.

Year to date income has benefited from the application of net operating losses (tax loss carryforwards) of $71.0 million, which were fully utilized in Q3, 2023. The Company anticipates accruing for income taxes in Q4, 2023 with income going forward subject to Mexico's corporate tax rate of 30%. Payment of the 2023 income taxes, together with Extraordinary and Special Mining Duties, will be due and paid in Q1, 2024. In 2024 and beyond, the Company expects to make quarterly income tax installments and annual payments for the Extraordinary and Special Mining Duties in the first quarter following the year end.

During Q3, 2023, the Company changed the functional currency of its parent entity from Canadian Dollars to US$. The Company determined that the US$ better represents the primary economic environment in which the parent entity operates. This change has been accounted for prospectively, which means starting Q3, 2023, the parent entity's functional currency is now the same as the presentation currency of US$ and there is no longer a need to record exchange gain and losses to foreign currency translation reserve as of July 1, 2023.

Sustaining Capital Expenditure

During Q3, 2023, sustaining capital expenditure of $9.8 million was a decrease from Q2, 2023 of $0.3 million and below plan for the quarter. The majority of the decrease from plan can be attributed to delays in procuring key underground materials as well as some slight changes to scope. During the quarter a surface mobile maintenance facility was constructed by SilverCrest to address ongoing mobile maintenance challenges encountered by its underground contractor. The construction of the facility is part of a work plan to improve equipment availability, which is expected to take some time to improve.

The Company anticipates its capital spending at Las Chispas to increase in Q4, 2023 relative to Q3, 2023 and remain within 2023 AISC guidance.

Exploration Update

During the quarter, 14,183 metres of exploration drilling was completed at Las Chispas, with 83% of the metres focused on infill drilling of Inferred Resources (see Updated Technical Report) for conversion to Indicated Resources and ultimately consideration for reserve conversion. The remaining drilling (2,455 metres) was for new vein targets. The exploration budget remains $10 million from Q3, 2023 through the end of Q1, 2024. In Q3, 2023, the Company spent $2.8 million on exploration at Las Chispas.

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ESG

In September 2023 the Company signed a collaboration agreement with Comisión Estatal del Agua (CEA) and the municipality of Arizpe to work on agriculture infrastructure, sewage system and water concessions for agricultural use for the local communities, a positive step in the Company's  water stewardship plan. This agreement advances continued efforts to help the local communities secure state and federal funding for water related infrastructure to protect livelihoods and create long-term economic resilience. 

Subsequent to the end of the quarter, the Company was awarded two recognitions from the Confederation of Industrial Chambers of the United Mexican States (CONCAMIN) in the areas of Outstanding Practices in the Industry and Ethics and Values.

Guidance

SilverCrest's 2023 production and cost guidance remains unchanged. The Company remains on track to achieve 9.8 to 10.2 million ounces sold for 2023 at average all in sustaining costs within the expected range of $12.75 to $13.75 per oz AgEq sold.

Appointment of Vice President of Financial Reporting and Controller

The Company is pleased to announce the appointment of Sean Deissner as Vice President of Financial Reporting and Controller, effective November 9, 2023. Before joining SilverCrest, Mr. Deissner spent more than seven years at Pan American Silver Corp ("Pan American") in various finance roles, until ultimately serving as Senior Director of Financial Reporting. During his tenure at Pan American, he successfully led the financial reporting team and oversaw its financial reporting strategy. Mr. Deissner brings with him 15 years of experience in the mining industry, which he gained from his roles at Pan American, Veris Gold Corp, Silvermex Resources Inc, and BDO Canada. Mr. Deissner is a designated Chartered Professional Accountant and is a graduate of Royal Roads University with a Bachelor of Commerce degree in Entrepreneurial Management.

Third Quarter 2023 Conference Call

A conference call to discuss the Company's Q3, 2023 operational and financial results will be held Thursday November 9, 2023 at 8:00 a.m. PT / 11:00 a.m. ET. To participate in the conference call, please dial the numbers below.

Date & Time: Thursday November 9, 2023 at 11:00 a.m. ET / 8:00 a.m. PT

Telephone: Toronto: +1-416-764-8624

 North America Toll Free: 1-888-259-6580

 Conference ID: 61658743

Webcast: https://silvercrestmetals.com/investors/presentations/

Qualified Persons Statement

The Qualified Person under National Instrument 43-101 Standards of Disclosure for Mineral Projects for this news release is N. Eric Fier, CPG, P.Eng, and CEO for SilverCrest, who has reviewed and approved its contents.

ABOUT SILVERCREST METALS INC.

SilverCrest is a Canadian precious metals producer headquartered in Vancouver, BC, with an ongoing initiative to increase its asset base by expanding current resources and reserves, acquiring, discovering and developing high value precious metals projects and ultimately operating multiple silver-gold mines in the Americas. The Company's principal focus is its Las Chispas Operation in Sonora, Mexico. The Company is led by a proven management team in all aspects of the precious metal mining sector, including taking projects through discovery, finance, on time and on budget construction, and production.

FORWARD-LOOKING STATEMENTS

This news release contains "forward-looking statements" and "forward-looking information" (collectively "forward-looking statements") within the meaning of applicable Canadian and United States securities legislation. These include, without limitation, statements with respect to: the amount of future production of gold and silver over any period, the strategic plans and expectations for the Company's operation and exploration program, expected recoveries, and expected cash costs and outflows. Such forward-looking statements or information are based on a number of assumptions, which may prove to be incorrect. Assumptions have been made regarding, among other things: present and future business strategies, continued commercial operations at the Las Chispas Operation, the environment in which the Company will operate in the future, including the price of gold and silver, estimates of capital and operating costs, production estimates, estimates of Mineral Resources and Mineral Resources and metallurgical recoveries and mining operational risk; the reliability of Mineral Resource and Mineral Reserve Estimates, mining and development costs, the conditions in general economic and financial markets; availability of skilled labour; timing and amount of expenditures related to exploration programs; and effects of regulation by governmental agencies and changes in Mexican mining legislation. The actual results could differ materially from those anticipated in these forward-looking statements as a result of risk factors including: the timing and content of work programs; results of exploration activities; the interpretation of drilling results and other geological data; receipt, maintenance and security of permits and mineral property titles; environmental and other regulatory risks; project cost overruns or unanticipated costs and expenses; fluctuations in gold and silver prices and general market and industry conditions. Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statements were made. The Company undertakes no obligation to update or revise any forward-looking statements included in this news release if these beliefs, estimates and opinions or other circumstances should change, except as otherwise required by applicable law.

N. Eric Fier, CPG, P.Eng Chief Executive Officer SilverCrest Metals Inc.

For Further Information: SilverCrest Metals Inc. Contact: Lindsay Bahadir, Manager Investor Relations and Corporate Communications Telephone: +1 (604) 694-1730 Fax: +1 (604) 357-1313 Toll Free: 1-866-691-1730 (Canada & USA) Email: info@silvercrestmetals.com Website: www.silvercrestmetals.com 570 Granville Street, Suite 501 Vancouver, British Columbia V6C 3P1

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NON-IFRS FINANCIAL MEASURES

SilverCrest uses certain non-IFRS performance measures in this news release. Non-IFRS financial measures do not have any standardized meaning under IFRS and may not be comparable to similar measures presented by other issuers. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, management and certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Non-IFRS financial measures - Average realized gold and silver price

Average realized gold and silver price per ounce is calculated by dividing the Company's gross revenue from gold or silver sales for the relevant period by the gold or silver ounces sold, respectively. The Company believes the measure is useful in understanding the metal prices realized by the Company throughout the period. Average realized price per ounce sold is a common performance measure that does not have any standardized meaning. The most directly comparable measure prepared in accordance with IFRS is revenue from gold and silver sales.

			Q3, 2023			Q2, 2023			YTD, 2023
($ 000's, except per ounce amounts)
Revenues from financial statements		$	63,828		$	61,999		$	183,810
Ag sales			(35,823	)		(35,319	)		(102,449	)
Au sales	A		28,005			26,680			81,361
Au oz sold during the period	B		14,500			13,400			42,100
Average realized Au price per oz sold	A/B	$	1,931		$	1,991		$	1,933
Revenues from financial statements			63,828			61,999			183,810
Au sales			(28,005	)		(26,680	)		(81,361	)
Ag sales	A		35,823			35,319			102,449
Ag oz sold during the period	B		1,530,000			1,450,000			4,341,000
Average realized Ag price per oz sold	A/B	$	23.41		$	24.36		$	23.60

Non-IFRS financial measure - Net free cash flow

Net free cash flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS. SilverCrest calculates net free cash flow by deducting expenditures on mineral property, plant, and equipment from net cash provided by operating activities. Non-sustaining and growth capital activities are excluded. Net free cash flow is divided by the basic weighted average shares outstanding to get the net free cash flow per basic share. The Company believes that this measure provides valuable assistance to investors and analysts in evaluating the Company's ability to generate cash flow after capital investments and build the cash resources of the Company. The most directly comparable measure prepared in accordance with IFRS is net cash provided by operating activities less net cash used in investing activities. This differs from the Company's calculation as net cash used in investing activities is used in place of expenditures on mineral property, plant, and equipment. Net cash used in investing activities would include all cash inflows and outflows related to investing activities as per the consolidated statement of cash flows.

Net free cash flow			Q3, 2023			Q2, 2023(1)			YTD, 2023
			$ 000's			$ 000's			$ 000's
Cash flow from operating activities			43,220			50,840			121,032
Sustaining capital expenditures			(9,836	)		(10,103	)		(25,120	)
Net free cash flow at mine level	A		33,384			40,737			95,912
Weighted average shares outstanding - basic	B		146,776			147,231			147,067
Net free cash flow - basic per share	A/B		0.23			0.28			0.65
Sustaining capital expenditures ($ 000's)			Q3, 2023			Q2, 2023			YTD, 2023
Expenditures on mineral property, plant, and equipment			(13,081	)		(12,919	)		(33,930	)
Payment of lease liabilities			(11	)		(28	)		(82	)
Non-sustaining and growth capital activities			3,256			2,844			8,892
Sustaining capital expenditures			(9,836	)		(10,103	)		(25,120	)

⁽¹⁾ The Q2, 2023 cash flow from operating activities figure was revised, as detailed below.

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Revision of the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023

The Company identified an overstatement of unrealized foreign exchange loss error in the condensed consolidated interim statement of cash flows for the three and six months ended June 30, 2023, as originally filed. The impact of this error is as follows:

		Three months ended June 30, 2023										Six months ended June 30, 2023
		As previously reported			Effect of revision			As revised				As previously reported			Effect of revisions			As revised
CASH FLOWS FROM OPERATING ACTIVITIES
Income for the period	$	23,702		$	-		$	23,702			$	50,867		$	-		$	50,867
Adjustments for:
Foreign exchange loss, unrealized		15,572			(6,990	)		8,582				13,943			(6,990	)		6,953
Cash flow from operating activities before changes in non-cash working capital items		47,475			(6,990	)		40,485				82,992			(6,990	)		76,002
Changes in non-cash working capital items
Value-added taxes receivable		5,475			4,022			9,497				1,433			4,022			5,455
Net cash (used in) provided by operating activities		53,808			(2,968	)		50,840				80,781			(2,968	)		77,813
Effect of foreign exchange on cash and cash equivalents		(5,140	)		2,968			(2,172	)			(2,149	)		2,968			819
Change in cash and cash equivalents, during the period	$	7,648		$	-		$	7,648			$	2,652		$	-		$	2,652

The statement of financial position as of June 30, 2023, including total cash and cash equivalents, and the statement of comprehensive income (loss) for the three and six months ended June 30, 2023, all remained the same as previously reported.

Non-IFRS financial measure - Net cash

SilverCrest calculates net cash by deducting debt from cash and cash equivalents as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, net cash is useful to evaluate its liquidity and capital resources.

Net Cash		September 30, 2023			June 30, 2023			December 31, 2022
		$ 000's			$ 000's			$ 000's
Cash and cash equivalents		69,979			53,413			50,761
Debt		-			-			(49,591	)
Net cash		69,979			53,413			1,170

Non-IFRS financial measure - Treasury assets

SilverCrest calculates treasury assets as cash and cash equivalents plus bullion as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, treasury assets is useful to evaluate its liquidity and capital resources.

Treasury assets		September 30, 2023 $ 000's			June 30, 2023 $ 000's			December 31, 2022 $ 000's
Cash and cash equivalents		69,979			53,413			50,761
Bullion		11,731			5,634			-
Treasury Assets		81,710			59,047			50,761

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Non-IFRS financial measure - Cash costs and cash costs per silver equivalent ounce sold

The Company uses cash costs per ounce of precious metals sold to monitor its operating performance internally. The most directly comparable measure prepared in accordance with IFRS is cost of sales. The Company believes this measure provides investors and analysts with useful information about its underlying cash costs of operations. The Company also believes it is a relevant metric used to understand its operating profitability and ability to generate cash flow. Cash costs are measures developed by precious metals companies in an effort to provide a comparable standard; however, there can be no assurance that the Company's reporting of these non-IFRS financial measures are similar to those reported by other mining companies. They are widely reported in the silver mining industry as a benchmark for performance, but do not have a standardized meaning and are disclosed in addition to IFRS financial measures. Cash costs include production costs, refinery and transportation costs and extraordinary mining duty. Cash costs excludes non-cash depreciation and depletion and site share-based compensation.

Cash costs per silver equivalent ounce sold is calculated by dividing cash costs by the silver equivalent ounces sold.

Non-IFRS financial measure - AISC and AISC per silver equivalent ounce sold

The Company defines AISC as the sum of total cash costs (as defined above); general and administrative expenses; share-based compensation; reclamation and closure provision depletion and accretion related to current operations; sustaining capital expenditures relating to current operations, including underground mine development and exploration and evaluation costs; and payments for leases. Corporate and allocated general and administrative expenses do not include non-cash depreciation. As this measure seeks to reflect the full cost of silver equivalent production from current operations, growth capital is excluded. Certain other cash expenditures, including tax payments and financing charges are also excluded. There are some slight differences in the way that Cash Costs and AISC were calculated in the Report compared to the Company's definitions as the Report looks at the standalone operation. The Report includes 7.5% mining royalty (treated as an income tax under IFRS) but excluded corporate and allocated general and administrative expenses and share-based compensation.

($ 000's, except per ounce amounts)		Q3, 2023			Q2, 2023			YTD, 2023
Cost of sales from financial statements	$	26,368		$	23,706		$	72,451
Less: depreciation and depletion		(6,322	)		(4,990	)		(15,356	)
Less: changes in inventories		(1,662	)		877			(1,691	)
Less: corporate salaries and other expenses (including site share-based compensation)		(855	)		(1,003	)		(3,021	)
Total cash costs		17,529			18,590			52,383
Add: sustaining capital expenditures		9,836			10,103			25,120
Add: reclamation and closure provision - depletion and accretion		132			225			556
Add: changes in inventories		1,662			(877	)		1,691
Add: corporate general and administrative expenses (including share-based compensation)		2,808			2,894			9,222
Add: corporate salaries and other expenses (including share-based compensation)		855			1,003			3,021
Total all-in sustaining costs	$	32,822		$	31,938		$	91,993
AgEq koz sold (79.51:1)(1)		2,683			2,515			7,688
Total cash costs per oz sold	$	6.53		$	7.39		$	6.81
All-in sustaining costs per oz sold	$	12.23		$	12.70		$	11.97

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