SILVERCORP METALS INC. Annual Report - How They Did This Year

I’ve put together this guide to help you understand Silvercorp Metals Inc.’s performance over the past year. My goal is to break down their complex financial filings into simple terms so you can decide if this company belongs in your portfolio.

1. What does this company do?

Silvercorp mines silver, gold, lead, and zinc. They currently generate most of their money from the Ying Mining District and the GC mine in China. To grow, they are developing the El Domo project in Ecuador and the Chaarat Zaav project in Kyrgyzstan. They are actively transitioning from a single-country operator to a global producer.

2. Financial performance: The "Big Picture"

This year was a tale of two stories: strong operational growth, but a hit to the bottom line from one-time costs.

• Revenue: They brought in $438.1 million, a 47% increase from $298.9 million in 2025.
• Cash Flow: They generated $310.6 million in cash from operations, more than double the $138.6 million from the previous year.
• Profitability: They reported a loss of $9.9 million ($0.05 per share), compared to a $58.2 million profit ($0.29 per share) in 2025. This loss was driven by a $148.7 million non-cash charge related to their investment in OreCorp Limited. Excluding this and other one-time items, their "adjusted" profit was $150.8 million ($0.69 per share), a significant improvement over the $75.1 million ($0.37 per share) from last year.

3. Production: The "Mining Math"

The company is digging up more ore, though the mix of metal output shifted:

• Ore Processed: They processed 1.47 million tonnes of ore, up 12% from last year.
• Gold: Production rose 16% to 8,723 ounces.
• Silver/Lead/Zinc: Silver production hit 6.2 million ounces (down 2%), lead was 64.7 million pounds (down 7%), and zinc was 24.8 million pounds (down 4%). The increase in ore processed alongside lower metal output indicates that the ore mined this year contained a lower grade of minerals than the previous year.

4. Major wins and challenges

• Wins: The jump in operating cash flow highlights the profitability of their Chinese assets. The acquisition of OreCorp Limited provides a new foothold in Tanzania, and development continues at the El Domo and Chaarat Zaav projects.
• Challenges: The BYP Mine in China has been on "care and maintenance" since 2014. The company is currently working to renew their mining license, though the timeline for this remains uncertain.

5. Financial health: Cash and Debt

Silvercorp is in a growth phase that requires significant capital, utilizing cash from their Chinese mines to fund international expansion. As of March 31, 2026, they held $211.5 million in cash and short-term investments with 220.9 million shares outstanding. They manage risks associated with currency fluctuations between the U.S. Dollar, the Chinese Renminbi, and the Canadian Dollar.

6. Key risks to watch

• Operational Risk: The company relies heavily on the Ying and GC mines. Any disruption to permits, environmental regulations, or labor in China directly impacts cash flow.
• Geopolitical Risk: Operating in diverse countries exposes the company to changes in mining laws, tax structures, and potential asset risks.
• Project Delays: Developing new mines is capital-intensive. If El Domo or Chaarat Zaav face delays or cost overruns, the company may need to raise additional capital, which could dilute existing shareholders.
• Market Volatility: Revenue is tied to the market prices of silver, gold, lead, and zinc. A decline in these commodity prices would shrink profit margins.

7. How to dig deeper

If you want the "blueprints" for their future, check their technical reports (Exhibits 99.9 through 99.13). These detail their mineral reserves, which form the basis for their production goals. If you are considering a significant investment, these documents provide the necessary context to evaluate the long-term potential of each individual mine.