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Great Panther Silver Reports Fourth Quarter Net Profit Of $1.0 Million

March 18, 2010
GREAT PANTHER SILVER LIMITED (TSX: GPR; the "Company") is pleased to announce the unaudited financial results for the Company's year ending December 31, 2009. The Company will be filing its annual audited consolidated financial statements and management's discussion and analysis on March 19, 2010, following which the full version of these documents will be available to be viewed on the Company's web site at or on SEDAR at

"The Board is very pleased to see the Company's first quarterly net profit of $1.0 million. And in terms of production, gross revenues, net operating profits and positive cash flow, 2009 was the Company's fourth successive all-time record year," said Kaare Foy, Executive Chairman.

Fourth Quarter Highlights

  • Record metal production of 625,288 silver equivalent ounces ("Ag eq oz")(1), up 5% from the third quarter of 2009 and 26% from the fourth quarter of 2008.

  • Record gold production of 2,456 oz Au, up 26% from the third quarter of 2009 and 53% from the fourth quarter of 2008.

  • Silver production of 390,026 oz Ag, within 2% of the third quarter of 2009 and up 9% from the fourth quarter of 2008.

  • Record production from Guanajuato of 470,025 Ag eq oz, up 9% from the third quarter of 2009 and 37% from the fourth quarter of 2008.

  • Net income of $1.0 million for the three months ended December 31, 2009 compared to a net loss of $1.2 million for the same period in 2008.

  • 80% increase in mineral sales revenues to $9.9 million for the three months ended December 31, 2009 from $5.5 million for the same period in 2008.

  • $3.7 million increase in earnings from mining operations(2) (excluding amortization and depletion) to $5.2 million for the three months ended December 31, 2009 from $1.5 million for the same period in 2008.

  • 37% decrease in cash cost per silver ounce(3), net of by-products, for the three months ended December 31, 2009 to US$4.80 from US$7.58 for the same period in 2008.

  • $3.7 million increase in Adjusted EBITDA(4) to $3.0 million for the three months ended December 31, 2009 from an Adjusted EBITDA loss of $0.7 million for the same period in 2008.

  • Acquisition of a 100% interest in the "La Prieta" concession in the Topia District to provide increased production by late 2010.
Year End Highlights

  • Record annual metal production of 2,202,456, up 22% from 2008, and 6% above target.

  • Record silver production of 1,456,830 silver ounces ("oz Ag"), up 20% from 2008, and meeting target.

  • Record gold production of 7,151 gold ounces ("oz Au"), up 14% from 2008, and 19% above target.

  • Highest quality concentrates to date, produced at record metal recoveries.

  • 41% increase in mineral sales revenues to $31.7 million for the twelve months ended December 31, 2009 from $22.4 million for 2008.

  • $10.7 million increase in earnings from mining operations (excluding amortization and depletion) to $15.0 million for the twelve months ended December 31, 2009 from $4.3 million for the same period in 2008.

  • 46% decrease in cash cost per silver ounce, net of by-products, for the full year 2009 to US$5.58 from US$10.25 in 2008.

  • $14.9 million increase in Adjusted EBITDA to $7.0 million for the year ended December 31, 2009 from an Adjusted EBITDA loss of $7.9 million in 2008.

  • New three-year strategy announced to accelerate annual production to 3.8 million Ag eq oz, increase National Instrument ("NI") 43-101 compliant resources to 40 million Ag eq oz, and invest $22 million in capital expenditures and $14 million in a 65,000-metre diamond drilling program for both mines.

  • Closed an equity offering for gross proceeds of $12.3 million on November 17, 2009.
Exploration Highlights

  • Announced completion of the first NI 43-101 compliant mineral resource estimate on the zone known as the 'Cata Clavo' at the Guanajuato Mine. The new indicated resource estimate of 5,032,000 Ag eq oz, plus 285,000 Ag eq oz in the inferred category, represents only a very small part of the 4.2 kilometre strike length of the Guanajuato deposit.

  • Increase to NI 43-101 compliant measured and indicated resources for Topia to 5.5 million Ag eq oz, and inferred resources to 5.7 million Ag eq oz, sufficient to support a 10-year mine plan.

  • Surface core drilling successfully extended known high grade mineralization in six areas at the Topia mine, including the Recompensa, San Gregorio, El Rosario, Cantarranas, San Miguel, and El Ochenta veins.

  • Successful mine exploratory development at Topia, including three areas hosting high grade silver-gold-lead-zinc mineralization along the San Gregorio, El Rosario and Don Benito veins which are already contributing to increased silver production.

  • Continued underground development at Guanajuato was successful in identifying and delineating three new zones of silver-gold mineralization, all of which are currently being developed for production. The Alto 2 Zone in the Cata area, Santa Margarita in the Rayas area and the Los Pozos Zone between Cata and Rayas will all make significant contributions to production in 2010 and beyond.
2010 Outlook

Great Panther has initiated its new strategy to accelerate production and increase resources at both Guanajuato and Topia. The new plan forecasts increases to 2.6 million Ag eq oz in 2010 and to 3.8 million Ag eq oz by 2012. In the fourth quarter of 2009, the Company successfully raised the financing required to initiate and accelerate this strategy. Subsequently, new equipment has been ordered and is being delivered to the mines, and exploration drill programs have started in the first quarter of 2010. Great Panther is confident that the targets outlined in its new strategy will be achieved or exceeded.

The Company will continue to provide silver equivalent totals but the volatility of metal prices in recent months has made this an inconsistent basis for comparison with past and future production, such that individual metal production will also be presented. The Company has used metal prices of US$11/oz Ag, US$850/oz Au, US$0.50/lb Pb and US$0.50/lb Zn for 2009 silver equivalent calculations. These have been revised in 2010 to US$16/oz Ag, US$1,000/oz Au, US$0.80/lb Pb and US$0.80/lb Zn.

Some highlights from the 2010 plan include:

Operations produced 1,456,830 silver ounces at a cash operating cost of US$5.58 per oz of silver, net of by-product credits, for the year 2009. This compares favourably to the forecasted range of US$6.00 to US$6.50 per silver oz, is well below current metal prices of approximately $17/oz Ag and represents a significant improvement over the 2008 cash cost of US$10.25/oz Ag. The cost per oz of silver is dependent upon mine site operating costs, silver production, the cost of smelting and refining, the relative value of the Mexican peso against the US dollar and the value of by-product credits.

Management anticipates that unit costs will continue the current downward trend and Great Panther remains on course to achieve costs of US$4.00/oz by 2012. Cash flow generated from mining activities will be reinvested in operations for exploration and capital expenditures to increase resources and production. Surplus cash flow will be available for potential acquisitions as the Company continues to grow.

Both operations have demonstrated the ability to achieve higher silver production at a lower cost per ounce and with a higher profit margin. The Company's emphasis will be on maintaining positive operating cash flow while developing and exploring to continually increase metal production. The Company's production strategy is to increase silver production by 20% year-on-year at continually decreasing unit costs.

Mr. Robert Archer, President & CEO said today, "I am extremely proud of the entire Great Panther team for a tremendous year of record production, financial results and resource growth, culminating in the Company's first quarter of positive earnings. As we are bullish on near-term metal prices, the acceleration of our 3-year growth strategy should result in continued strong performance for Great Panther in the years ahead."

For further information, please visit the Company's website at, contact B&D Capital at telephone 604 685 6465, fax 604 899 4303 or e-mail


"Robert A. Archer"

Robert A. Archer, President & CEO

"Kaare G. Foy"

Kaare G. Foy, Executive Chairman

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 the Securities Act (Ontario) (together, "forward-looking statements"). Such forward-looking statements may include but are not limited to the Company's plans for production at its Guanajuato and Topia Mines in Mexico, exploring its other properties in Mexico, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risks involving the Company's operations in a foreign jurisdiction, uncertainty of production and cost estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of silver, gold and base metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company's Annual Report on Form 20-F for the year ended December 31, 2008 and reports on Form 6-K filed with the Securities and Exchange Commission and available at and Material Change Reports filed with the Canadian Securities Administrators and available at

  1. Silver equivalent ounces in 2009 were established using prices of US$850/oz Au, US$11/oz Ag, US$0.50/lb Pb and US$0.50/lb Zn.

  2. "Earnings from mining operations" is a non-GAAP measure and is defined as mineral sales less cost of sales (excluding amortization and depletion).

  3. The non-GAAP measure of cash cost per ounce of silver is used by the Company to manage and evaluate operating performance at each of the Company's mines and is widely reported in the silver mining industry as a benchmark for performance, but does not have a standardized meaning.

  4. "Adjusted EBITDA" is a non-GAAP measure in which standard EBITDA (earnings before interest expense, taxes, and depreciation and amortization) is adjusted for stock-based compensation expense and non-recurring items.

Click here to view entire News Release and Financial Highlights in PDF format


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