GlobeNewswire Inc | Aug 10, 2021 06:50AM EDT

August 10, 2021

VANCOUVER, British Columbia, Aug. 10, 2021 (GLOBE NEWSWIRE) -- Endeavour Silver Corp. (NYSE: EXK; TSX: EDR) released its financial results today for the three and six months ended June 30, 2021. The Company operates three silver-gold mines in Mexico: the Guanacev mine in Durango state, the Bolaitos mine in Guanajuato state and the El Compas mine in Zacatecas state. All amounts reported are in United States (US) dollars.

Dan Dickson, CEO, commented, From a financial standpoint, our Q2 performance was stronger than the respective period last year, as revenue, cash flow and earnings were all higher. However, our operating costs are clearly not where we want them to be. We are working to optimize our operating cost profile in the second half of 2021.

This month, we plan to suspend operations at El Compas due to exhaustion of reserves. This small asset represents less than 5% of 2021 consolidated production and will not affect our progress towards attaining or surpassing our production guidance for the year. Our remaining production platform at Guanacevi and Bolaitos is strong and sustainable with excellent brownfield exploration opportunities.

We are pleased to enter the second half of the year with a robust cash balance of $125 million and a clean balance sheet ahead of a potential construction decision for Terronera later this year. We will be completing the Feasibility Study during Q3 with a construction decision anticipated shortly thereafter.

2021 Second Quarter Highlights

-- Metal Production: Produced 1,073,724 ounces (oz) silver, up 80% and 11,166 oz gold, up 92%, in-line with guidance for 2.0 million oz silver equivalent (AgEq), up 85%, at an 80:1 silver:gold ratio, compared to Q2, 2020 when operations were suspended due to COVID-19 for a portion of the period. -- Net Revenue:Totaled $47.7 million, up 136%, from the sale of 1,120,266 oz silver and 9,810 oz gold at average realized prices of $26.82 per oz silver and $1,866 per oz gold. Management withheld metal sales in Q1, 2021 and continues to carry higher metal inventory totaling 459,659 oz silver and 1,891 oz gold of bullion inventory and 12,159 oz silver and 944 oz gold in concentrate inventory. -- Operating Costs: Cash cost(1) $13.03 per oz payable silver, up 369% year-on-year and all-in sustaining cost (AISC)(1) $25.39 per oz payable silver, up 70% year-on-year, net of gold credits. Operating costs were higher than budgeted due to global supply chain constraints creating inflationary pressures, increased labor costs, a strengthening Mexican Peso and increased operating development at Guanacevi. -- Cash Flow: $8.7 million in cash flow from operations before working capital changes, up 358% compared to Q2, 2020. The Company continued to hold significant finished goods, increased deposits for equipment purchases, invested in exploration activities and advanced the Terronera Feasibility Study. -- Earnings: Realized earnings of $6.7 million or $0.04 per share, up sharply compared to a loss of $3.3 million in Q2, 2020 due to increased mine operating earnings, the gain on the sale of the El Cubo asset and gain on the sale of marketable securities, offset by increased exploration and evaluation activities, higher general and administrative costs and higher tax expense. Excluding the gain on sale of the El Cubo asset, the adjusted earnings are $0.8 million. At quarter end, the finished golds inventory was carried at a cost of $10.1 million compared to the fair market value of $17.3 million.

-- Strong Balance Sheet: Cash position $125.2 million and working capital $146.8 million. Raised $28.4 million in equity financing through an ATM facility, net of issuance costs. Only remaining term liabilities are equipment loans of $7.8 million.

-- Completed the Sale of El Cubo: The transaction closed on April 9, 2021 for $19.8 million in cash and share payments with up to $3 million in contingent payments payable by Guanajuato Silver (previously Vangold Mining Corp).

Subsequent to the End of the Second Quarter 2021:

-- Suspension of Operations at El Compas: The Company has decided to suspend mining and milling operations at El Compas in August. Mining assets and key talent will be transferred within the Company to Bolaitos and Terronera. The associated suspension costs are estimated to be $1.3 million, including $1.0 million in severance, to be incurred over the remainder of the year. Management is currently evaluating its alternatives for the assets. -- Agreement to Acquire Bruner Gold Project from Canamex: strategic acquisition opportunity for an advanced stage exploration property in a favorable jurisdiction for $10 million in cash. The agreement is subject to Canamex shareholder approval in Q3 (see EDR news release dated July 19, 2021).

(1)Mine operating cash flow, cash costs and all-in sustaining costs are non-IFRS measures. Please refer to the definitions in the Companys Management Discussion & Analysis.

Financial Overview

In Q2 2021, net revenue increased 136% to $47.7 million as a result of higher metal prices and increased production. Mine operating cash flows, operating cash flows and EBITDA increased significantly compared to Q2, 2020. For a period in Q2, 2020, the mine operations were suspended due to government decree to stop the spread of COVID-19.

The Company recognized earnings of $6.7 million compared to a loss of $3.3 million in Q2, 2020. A gain of $5.8 million was recognized on the sale of the El Cubo mine and related assets and liabilities.

Cost of sales for Q2, 2021 was $37.5 million, an increase of 109% over the cost of sales of $17.1 million for the same period of 2020. The increase in cost of sales was primarily related to the 76% increase in silver ounces sold, significantly higher royalty costs, labour costs and additional costs attributed to global supply constraints. Royalties increased 438% from $0.8 million to $4.3 million due to higher production and realized prices and the increased mining of the high grade Porvenir Cuatro extensions at the Guanacev operation, which are subject to the significantly higher royalty rates.

The Company slightly decreased its finished goods silver and increased its finished goods gold inventory to 459,659oz and 1,891 oz, respectively at June 30, 2021 compared to 529,817 oz silver and 1,689 oz gold at March 31, 2021. The cost allocated to these finished goods was $10.1million at June 30, 2021, compared to $8.0 million at March 31, 2021. At June 30, 2021, the finished goods inventory fair market value was $17.3 million, compared to $15.9 million at March 31, 2021.

Financial Results (Consolidated Statement of Operations Appended Below)

For the period ended June 30, 2021, the Company generated net revenue of $47.7 million an increase of 136% compared to $20.2 million. Gross sales of $48.3 million in Q2, 2021 represented a 136% increase over the $20.5 million for the same period in 2020. There was a 76% increase in silver ounces sold and a 57% increase in the realized silver price resulting in a 179% increase to silver sales. Similarly, there was an 88% increase in gold ounces sold at prices similar to the prior year resulting in an 88% increase in gold sales. During the period, the Company sold 1,120,266 oz silver and 9,810 oz gold, for realized prices of $26.82 and $1,866 per oz, respectively, compared to sales of 634,839 oz silver and 5,218 oz gold, for realized prices of $17.04 and $1,862 per oz, respectively, in the same period of 2020. For the three months ended June 30, 2021, silver and gold spot prices averaged $26.69 and $1,816, respectively.

After cost of sales of $37.5 million (Q2, 2020 - $17.1 million), mine operating earnings amounted to a $10.2 million (Q2, 2020 $3.1 million) from mining and milling operations in Mexico.

Excluding depreciation and depletion of $6.6 million (Q2, 2020 - $3.9 million), stock-based compensation of $0.1 million (Q2, 2020- $0.1 million) and a write-down of inventory of $0.3 million (Q2, 2020 - $0.5 million), mine operating cash flow before taxes was $17.2 million in Q2, 2021 (Q2, 2020 $7.6 million). Operating earnings were $0.8 million (Q2, 2020 loss of $4.6 million) after exploration and evaluation expenditures of $5.0 million (Q2, 2020 $1.7 million), general and administrative expense of $4.3 million (Q2, 2020 $3.1 million) and care and maintenance costs of $0.1 million (Q2, 2020 $2.9 million).

Net earnings amounted to $6.7 million ($0.04 per share) compared to a net loss of $3.3 million (loss of $0.02 per share) in Q2, 2020.

Current income tax expense increased to $2.2 million (Q2 2020 $0.2 million) due to increased profitability impacting special mining duty, while deferred income tax expense of $1.1 million was recognized due to the estimated use of loss carry forwards to reduce taxable income at Guanacevi (Q2 2020 $0.5 million deferred income tax recovery).

Direct operating costs per tonne in Q2, 2021 increased 18%, to $119.94 compared with Q2, 2020 due to higher operating costs at all operations. The operations have seen a strengthening of the Mexican Peso, increased labour costs, increased third party ore purchased and increased operating development at Guanacev compared to prior year and budgeted. Including royalties and special mining duty, direct costs per tonne increased 29% to $141.61. Royalties increase 1,781% to $4.3 million as increased production from the El Curso and El Porvenir concessions at Guanacev with higher prices substantially increased the royalty expense. The improved profitability increased special mining duty expense to $0.9 million for Q2, 2021, which was negligible in Q2, 2020.

Consolidated cash costs per ounce, net of by-product credits (a non-IFRS measure and a standard of the Silver Institute) increased to $13.03 due to the increased direct costs per tonne. All-in sustaining costs (also a non-IFRS measure) increased to $25.39 per ounce in Q2,2021 as a result of higher corporate general and administrative costs, increased mine site expensed exploration and increased capital expenditures at Guanacev to accelerate mine development within the El Curso ore body. In Q2, 2021 corporate general and administrative included a $1.6 million mark to market expense of deferred share units expense whereas the mark to market expense was $1.1 million in Q2, 2020.

The Condensed Consolidated Interim Financial Statements and Managements Discussion & Analysis can be viewed on the Companys website at www.edrsilver.com, on SEDAR at www.sedar.com and EDGAR at www.sec.gov.

Conference Call

A conference call to discuss these results will be held today, Tuesday, August 10 at 10am PDT (1pm EDT). To participate in the conference call, please dial the numbers below. No pass-code is necessary.

Toll-free in Canada and the US: 1-800-319-4610 Local Vancouver: 604-638-5340 Outside of Canada and the US: +-604-638-5340

A replay of the conference call will be available by dialing 1-800-319-6413 in Canada and the US (toll-free) or +604-638-9010 outside of Canada and the US. The required pass-code is 7318 #. The replay will also be available on the Companys website at www.edrsilver.com.

About Endeavour Silver Endeavour Silver Corp. is a mid-tier precious metals mining company that owns and operates three high-grade, underground, silver-gold mines in Mexico. Endeavour is currently advancing the Terronera mine project towards a development decision and exploring its portfolio of exploration and development projects in Mexico and Chile to facilitate its goal to become a premier senior silver producer. Our philosophy of corporate social integrity creates value for all stakeholders.

SOURCE Endeavour Silver Corp.

Contact Information Galina Meleger, Vice President, Investor RelationsToll free: (877) 685-9775Tel: (604) 640-4804Email: gmeleger@edrsilver.com Website: www.edrsilver.com

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Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the United States private securities litigation reform act of 1995 and forward-looking information within the meaning of applicable Canadian securities legislation. Such forward-looking statements and information herein include but are not limited to statements regarding Endeavours anticipated performance in 2021 including changes in mining operations and production levels, the timing and results of various activities and the impact of the COVID 19 pandemic on operations. The Company does not intend to and does not assume any obligation to update such forward-looking statements or information, other than as required by applicable law.

Forward-looking statements or information involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, production levels, performance or achievements of Endeavour and its operations to be materially different from those expressed or implied by such statements. Such factors include but are not limited to the ultimate impact of the COVID 19 pandemic on operations and results, changes in production and costs guidance, national and local governments, legislation, taxation, controls, regulations and political or economic developments in Canada and Mexico; financial risks due to precious metals prices, operating or technical difficulties in mineral exploration, development and mining activities; risks and hazards of mineral exploration, development and mining; the speculative nature of mineral exploration and development, risks in obtaining necessary licenses and permits, and challenges to the Companys title to properties; as well as those factors described in the section risk factors contained in the Companys most recent form 40F/Annual Information Form filed with the S.E.C. and Canadian securities regulatory authorities.

Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to: the continued operation of the Companys mining operations, no material adverse change in the market price of commodities, mining operations will operate and the mining products will be completed in accordance with managements expectations and achieve their stated production outcomes, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or information, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended. There can be no assurance that any forward-looking statements or information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.

ENDEAVOUR SILVER CORP.COMPARATIVE HIGHLIGHTS

Three Months Ended June 30 Q2 2021 Six Months Ended June 302021 2020 % Highlights 2021 2020 % Change ChangeProduction Silver1,073,724 596,545 80 % ounces 2,121,824 1,454,204 46 % produced11,166 5,817 92 % Gold ounces 22,275 14,293 56 % produced Payable1,062,267 590,618 80 % silver 2,098,977 1,440,409 46 % ounces produced Payable10,955 5,717 92 % gold ounces 21,849 14,037 56 % produced Silver1,967,004 1,061,905 85 % equivalent 3,903,824 2,597,644 50 % ounces produced Cash costs13.03 2.78 369 % per silver 10.48 5.77 82 % ounce Total19.55 10.33 89 % production 17.51 13.88 26 % costs per ounce All-in25.39 14.91 70 % sustaining 22.69 16.96 34 % costs per ounce242,018 114,120 112 % Processed 451,471 313,447 44 % tonnes Direct119.94 102.02 18 % operating 116.43 98.76 18 % costs per tonne Direct141.61 109.74 29 % costs per 134.48 104.59 29 % tonne Silver18.52 10.16 82 % co-product 16.89 10.99 54 % cash costs Gold1,288 1,111 16 % co-product 1,116 1,175 (5 cash costsFinancial47.7 20.2 136 % Revenue ($ 82.2 42.1 95 % millions)1,120,266 634,839 76 % Silver 1,743,645 1,300,339 34 % ounces sold9,810 5,218 88 % Gold ounces 20,473 12,672 62 % sold Realized26.82 17.04 57 % silver 26.95 16.16 67 % price per ounce Realized1,866 1,862 0 % gold price 1,781 1,727 3 % per ounce Net6.7 (3.3 ) 302 % earnings 18.9 (19.2 ) 198 % (loss) ($ millions) Adjusted net0.8 (3.3 ) 126 % earnings (3.7 ) (19.2 ) 81 % (loss) ($ millions) Mine operating10.2 3.1 228 % earnings 15.9 0.2 6800 % (loss) ($ millions) Mine operating17.2 7.6 125 % cash flow 30.5 11.9 156 % ($ millions) Operating cash flow8.7 1.9 358 % before 13.9 (3.1 ) 551 % working capital changes Earnings15.9 1.2 1214 % before ITDA 39.8 (5.5 ) 823 % ($ millions) Working146.8 44.6 229 % capital ($ 146.8 44.6 229 % millions)Shareholders Earnings0.04 (0.02 ) 300 % (loss) per 0.12 (0.13 ) 192 % share ? basic Adjusted earnings0.01 (0.02 ) 123 % (loss) per (0.02 ) (0.13 ) 83 % share ? basic Operating cash flow before0.05 0.01 302 % working 0.08 (0.02 ) 499 % capital changes per share Weighted168,383,755 147,862,393 14 % average 164,051,368 144,836,300 13 % shares outstanding

The above highlights are key measures used by management, however they should not be the sole measures used in determining the performance of the Companys operations. The related definitions and reconciliations are contained in the Management Discussion and Analysis.

ENDEAVOUR SILVER CORP.CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS(expressed in thousands in U.S. dollars)

Three months ended Six months ended June 30, June 30, June 30, June 30, 2021 2020 2021 2020 Operating activitiesNet earnings(loss) for the $ 6,656 $ (3,289 ) $ 18,905 $ (19,215 )period Items not affecting cash:Share-based 1,028 848 2,193 1,593 compensationDepreciation,depletion and 6,723 4,213 14,347 10,481 amortizationImpairmentreversal of - - (16,791 ) - non-current assetsDeferred incometax expense 1,116 (514 ) 4,243 1,350 (recovery)Unrealized foreignexchange loss (143 ) (140 ) (53 ) 514 (gain)Finance costs 216 337 507 648 Write down ofinventory to net 272 486 272 1,528 realizable valueLoss (gain) on (5,841 ) 57 (5,807 ) 135 asset disposalGain on other (1,366 ) (107 ) (3,912 ) (114 )investmentsNet changes innon-cash working 806 (2,800 ) (8,360 ) (178 )capitalCash from (usedin) operating 9,467 (909 ) 5,544 (3,258 )activities Investing activitiesProceeds ondisposal of 6,985 73 7,541 100 property, plantand equipmentMineral property,plant and (8,164 ) (4,872 ) (15,434 ) (10,384 )equipmentexpendituresPurchase ofmarketable - - (832 ) - securitiesProceeds fromdisposal of 4,905 - 9,288 - marketablesecuritiesRedemption of(investment in) 19 - (1 ) - non-currentdepositsCash from (usedin) investing 3,745 (4,799 ) 562 (10,284 )activities Financing activitiesRepayment of loans (918 ) (554 ) (1,887 ) (1,326 )payableRepayment of (43 ) (49 ) (85 ) (92 )leaseliabilitiesInterest paid (174 ) (243 ) (367 ) (461 )Public equity 29,034 22,703 59,134 24,188 offeringsExercise of 785 8 4,583 20 optionsShare issuance (664 ) (963 ) (1,266 ) (1,037 )costsPerformance share (2,174 ) - (2,174 ) - unit redemptionCash from (usedin) financing 25,846 20,902 57,938 21,292 activities Effect of exchangerate change on cash 144 314 64 (620 )and cash equivalents Increase(decrease) in cash 39,058 15,194 64,044 7,750 and cashequivalentsCash and cashequivalents, 85,989 14,990 61,083 23,368 beginning of theperiodCash and cashequivalents, end $ 125,191 $ 30,498 $ 125,191 $ 30,498 of the period

This statement should be read in conjunction with the condensed consolidated interim financial statements for the period ended June 30, 2021 and the related notes contained therein.

ENDEAVOUR SILVER CORP.CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME (LOSS)(expressed in thousands in U.S. dollars, except for share and per share amounts)

Three months ended Six months ended June 30, June 30, June 30, June 30, 2021 2020 2021 2020 Revenue $ 47,775 $ 20,201 $ 82,241 $ 42,128 Cost of sales: Directproduction 26,223 11,722 44,951 28,522 costsRoyalties 4,340 834 6,800 1,691 Share-based 111 92 229 183 paymentsDepreciation,depletion and 6,624 3,951 14,120 9,974 amortizationWrite down ofinventory to 272 486 272 1,528 net realizablevalue 37,570 17,085 66,372 41,898 Mine operating 10,205 3,116 15,869 230 earnings Expenses: Exploration 5,025 1,665 9,155 4,047 and evaluationGeneral and 4,293 3,137 7,816 5,142 administrativeCare andmaintenance 55 2,911 576 4,256 costsImpairmentreversal of - - (16,791 ) - non-currentassets 9,373 7,713 756 13,445 Operatingearnings 832 (4,597 ) 15,113 (13,215 )(loss) Finance costs 216 356 507 666 Other income (expense):Foreign 659 740 (35 ) (4,177 )exchangeGain on asset 5,841 - 5,841 - disposalsInvestment and 1,802 605 4,553 654 other 8,302 1,345 10,359 (3,523 ) Earnings(loss) before 8,918 (3,608 ) 24,965 (17,404 )income taxes Income taxexpense (recovery):Current income 1,146 195 1,817 461 tax expenseDeferredincome tax 1,116 (514 ) 4,243 1,350 expense(recovery) 2,262 (319 ) 6,060 1,811 Net earnings(loss) andcomprehensive 6,656 (3,289 ) 18,905 (19,215 )earnings (loss)for the period Basic earnings(loss) pershare based on $ 0.04 $ (0.02 ) $ 0.12 $ (0.13 )net earnings(loss)Diluted earnings(loss) per share $ 0.04 $ (0.02 ) $ 0.11 $ (0.13 )based on netearnings (loss) Basic weightedaverage number 168,383,755 147,862,393 164,051,368 144,836,300 of sharesoutstandingDilutedweightedaverage number 172,195,942 147,862,393 167,743,113 144,836,300 of sharesoutstanding

This statement should be read in conjunction with the condensed consolidated interim financial statements for the period ended June 30, 2021 and the related notes contained therein.

ENDEAVOUR SILVER CORP.CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION(expressed in thousands in U.S. dollars, except for share and per share amounts)

June 30, December 31, 2021 2020 ASSETS Current assets Cash and cash equivalents $ 125,191 $ 61,083 Other investments 10,024 4,767 Accounts and other receivable 16,167 20,144 Income tax receivable 61 52 Inventories 23,929 16,640 Prepaid expenses 7,281 2,284 Total current assets 182,653 104,970 Deposits 592 591 Deferred financing costs - 294 Income tax recoverable 3,570 - IVA receivable 2,699 2,676 Deferred income tax asset 8,510 12,753 Intangible assets 248 492 Right-of-use leased assets 757 861 Mineral properties, plant and equipment 87,845 87,955 Total assets $ 286,874 $ 210,592 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities $ 29,687 $ 27,764 Income taxes payable 2,681 3,038 Loans payable 3,251 3,578 Lease liabilities 201 173 Total current liabilities 35,820 34,553 Loans payable 4,534 6,094 Lease liabilities 923 921 Provision for reclamation and 4,383 8,876 rehabilitationDeferred income tax liability 1,080 1,077 Total liabilities 46,740 51,521 Shareholders' equity Common shares, unlimited shares authorized, no par value, issuedand outstanding 170,300,394 shares (Dec 584,378 517,711 31, 2020 - 157,924,708 shares)Contributed surplus 5,153 9,662 Retained earnings (deficit) (349,397 ) (368,302 )Total shareholders' equity 240,134 159,071 Total liabilities and shareholders' equity $ 286,874 $ 210,592

This statement should be read in conjunction with the condensed consolidated interim financialstatements for the period ended June 30, 2021 and the related notes contained therein.