News Column

Silvercorp Reports Financial and Operating Results for the Third Quarter of Fiscal Year 2014

February 13, 2014

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 13, 2014) - Silvercorp Metals Inc. ("Silvercorp" or the "Company") (TSX:SVM)(NYSE:SVM) reported its financial and operating results for the third quarter ended December 31, 2013 ("Q3 Fiscal 2014"). THIRD QUARTER HIGHLIGHTS -- Silver production of 0.9 million ounces and gold production of 1,985 ounces; -- Lead production of 9.0 million pounds and zinc production of 1.7 million pounds; -- Sales of $24.0 million; -- Gross margin of 44%; -- Cash flow from operations of $9.9 million, or $0.06 per share; -- Net income of $2.2 million, or $0.01 per share; and -- Cash cost per ounce of silver, net of by-product credits, of $2.00.



FINANCIALS

In Q3 Fiscal 2014, net income attributable to equity holders of the Company was $2.2 million or $0.01 per share compared to $5.2 million, or $0.03 per share for the three months ended December 31, 2012 ("Q3 Fiscal 2013").

In Q3 Fiscal 2014, the Company realized sales of $24.0 million, a decrease of 59% from $58.7 million in Q3 Fiscal 2013. The Company's financial results were mainly impacted by the following: (i) lower metal production as silver, lead and zinc production decreased 42%, 45%, and 58% respectively, compared to Q3 Fiscal 2013; and (ii) a significantly lower net realized silver price of $16.20 per ounce in this quarter, down $8.70 per ounce or 35% from $24.90 per ounce in Q3 Fiscal 2013.

Cost of sales in Q3 Fiscal 2014 was $13.5 million compared to $21.2 million in Q3 Fiscal 2013 and included cash costs of $10.9 million compared to $17.1 million in Q3 Fiscal 2013. The decrease of cost of sales was due to the reduction in ore production in this quarter.

The gross profit margin in Q3 Fiscal 2014 was 44%, compared to 64% in Q3 Fiscal 2013.

Cash flow from operations in Q3 Fiscal 2014 was $9.9 million or $0.06 per share, compared to $27.8 million, or $0.16 per share, in Q3 Fiscal 2013.

For the nine months ended December 31, 2013, net loss, attributable to the equity holders of the Company, was $36.5 million or $0.21 per share, which included impairment charges of $42.8 million, net of tax. The impairment reduced the carrying value of the BYP mine, as well as the XBG and Silvertip projects, both of which are sold. Adjusted net income was $6.5 million or $0.04 per share, compared to net income of $20.9 million or $0.12 per share, in the same prior year period. During the same comparative period, sales were $92.3 million compared to $148.5 million, cost of sales was $50.8 million compared to $57.0 million, which resulted in a gross profit margin of 45% compared to 62%.

Cash flow from operations was $33.1 million compared to $71.0 million in the same comparative period. As of December 31, 2013, the Company has $98.0 million in cash and short-term investments.

OPERATIONS

In Q3 Fiscal 2014, on a consolidated basis, the Company produced 0.9 million ounces of silver, 1,985 ounces of gold, 9.0 million pounds of lead, and 1.7 million pounds of zinc, compared to 1.5 million ounces of silver, 5,676 ounces of gold, 16.4 million pounds of lead, and 4.0 million pounds of zinc, respectively, in Q3 Fiscal 2013.

For the nine months ended December 31, 2013, the Company produced 3.3 million ounces of silver, 8,774 ounces of gold, 32.0 million pounds of lead, and 7.6 million pounds of zinc, compared to 4.0 million ounces of silver, 10,810 ounces of gold, 44.1 million pounds of lead and 10.5 million pounds of zinc, in the same prior year period.

1. Ying Mining District, Henan Province, China

In Q3 Fiscal 2014, the Ying Mining District mined 148,850 tonnes of ore, producing 0.9 million ounces of silver, 911 ounces of gold, 8.8 million pounds of lead, and 1.6 million pounds of zinc, compared to 236,694 tonnes of ore in Q3 Fiscal 2013, producing 1.5 million ounces of silver, 1,285 ounces of gold, 15.6 million pounds of lead, and 3.2 million pounds of zinc, respectively.

In Q3 Fiscal 2014, head grades at the Ying Mining District were 202 grams per tonne ("g/t") for silver, 2.9% for lead, and 0.7% for zinc, compared to 222 g/t for silver, 3.2% for lead, and 1.0% for zinc, respectively, in Q3 Fiscal 2013.

In the quarter, mine production and head grades were adversely impacted by a number of factors. Firstly, underground safety standardization work was undertaken in the main production portal of PD924 at the LM West mine and the CM105-S2 Shaft at the SGX mine to comply with new safety regulations. The required safety work included rebuilding the refuge stations, enlarging main access tunnels, and replacing sections of the PVC compress air lines with steel ones, suspending production for approximately one month.

Second, as explained in the prior quarter, the Company identified that dilutive practices of certain mining contractors resulted in head grade declines and took remedial action by modifying the method of calculating the amount of ore mined for the purpose of compensating the contractors and miners. This change in compensation method resulted in miner shortages as some miners felt uncertain about their pay and left the mine sites. Unfortunately, our contractors have experienced difficulty in replacing the departed miners, particularly prior to the Chinese New Year. For this reason, mining in the PD16 Shaft, one of the main portals at the SGX mine, was suspended for approximately two months in this quarter.

Finally, the change in mining strategy, which began approximately a year ago, has yielded mixed results in its initial year of application. The change in mining strategy focused on reducing the use of re-suing method and increasing the use of shrinkage method. The key requirement of this strategy is the ability to control dilution. Certain mines, such as the LM mine, yielded good results, where dilution was low and cash mining cost were reduced. However, in other mines, such as SGX mine, dilution control was inadequate which negatively impacted head grades.

The Company has performed a comprehensive review of its operation at the Ying Mining District. From the review, a series of improvements covering all aspects of operations, including mine planning and strategy, contractor compensation methods, quality control, and a performance-based (linked to tonnage and grade) compensation package for mine management, were enacted. In the next quarter, the Company will monitor the effects of the new improvements and expect to be in a position to provide normalized production guidance for the Ying Mining District when we release our quarterly results in May.

In Q3 Fiscal 2014, total and cash mining costs per tonne were $60.89 and $50.59 compared to $64.47 and $54.92 in Q3 Fiscal 2013, respectively. The decrease in cash mining cost was mainly due to the reduction of contractor fees in this quarter.

For the nine months ended December 31, 2013, the Ying Mining District mined 535,210 tonnes of ore, producing 3.3 million ounces of silver, 3,066 ounces of gold, 31.4 million pounds of lead, and 6.7 million pounds of zinc, compared to 623,523 tonnes of ore producing 4.0 million ounces of silver, 3,352 ounces of gold, 42.8 million pounds of lead, and 9.6 million pounds of zinc in the same prior year period, respectively. During the same comparative period, head grades were 206 g/t for silver, 2.8% for lead, and 0.9% for zinc, compared to 224 g/t for silver, 3.4% for lead and 1.1% for zinc, respectively.

In Q3 Fiscal 2014, total ore milled was 149,755 tonnes, a decrease of 34% compared to 226,764 tonnes in Q3 Fiscal 2013. Cash milling costs per tonne were $16.00 compared to $12.61 in Q3 Fiscal 2013. The increase in unit cost is mainly due to the reduced tonnage milled. For the nine months ended December 31, 2013, total ore milled was 543,221 tonnes compared to 616,389 tonnes in the same prior year period. During the same time period, cash milling costs per tonne were $13.98 compared to $12.92.

In Q3 Fiscal 2014, the consolidated total production cost and cash cost per ounce of silver, net of by-product credits, were $4.39 and $2.00 compared to $1.52 and negative $0.17, respectively, in Q3 Fiscal 2013. For the nine months ended December 31, 2013, the consolidated total production cost and cash cost per ounce of silver, net of by-product credits, were $4.47 and $2.04 compared to $1.66 and negative $0.26, respectively, in the same prior year period.

The overall increase in cash cost per ounce of silver, net of by-product credits, is mainly due to decreases in by-product credits. Compared to the nine months ended December 31, 2012, lead and zinc production in the current fiscal year decreased 27% and 30%, respectively, along with decreases in realized selling price for lead and zinc of 6% and 2%, respectively.

The consolidated operational results for the past five quarters at the Ying Mining District are summarized in the table below:

Quarterly opertional results - Ying Mining District ---------------------------------------------------------------------------- Q3 2014 Q2 2014 Q1 2014 Q4 2013 Q3 2013 31-Dec-13 30-Sep-13 30-Jun-13 31-Mar-13 31-Dec-12 ---------------------------------------------------------------------------- Ore Mined (tonne) Direct Smelting Ore (tonne) 715 503 963 1,309 2,334 Stockpiled Ore (tonne) 148,135 152,599 232,294 152,014 234,360 -------------------------------------------------- 148,850 153,102 233,257 153,323 236,694 ---------------------------------------------------------------------------- Run of Mine Ore (tonne) Direct Smelting Ore (tonne) 715 503 963 1,309 2,334 Ore Milled (tonne) 149,040 156,790 235,210 156,836 224,430 -------------------------------------------------- 149,755 157,293 236,173 158,145 226,764 ---------------------------------------------------------------------------- Metal Sales Silver (in thousands of ounces) 883 1,021 1,364 933 1,508 Gold (in thousands of ounces) 0.9 0.9 1.3 0.8 1.3 Lead (in thousands of pounds) 8,814 9,519 13,063 9,462 15,642 Zinc (in thousands of pounds) 1,572 2,199 2,926 1,554 3,231 ---------------------------------------------------------------------------- Head Grade of Run of Mine Ore Silver (gram/tonne) 202 217 200 205 222 Lead (%) 2.9 2.9 2.7 2.9 3.2 Zinc (%) 0.7 1.0 0.8 0.7 1.0 ---------------------------------------------------------------------------- Recovery Rate of Run of Mine Ore Silver (%) 93.1 92.7 92.3 93.5 93.3 Lead (%) 95.7 94.8 94.6 94.5 95.1 Zinc (%) 64.2 68.5 68.4 60.3 70.4 ---------------------------------------------------------------------------- Cash Mining Cost ($ per tonne) 50.59 45.22 54.95 61.67 54.92 Total Mining Costs($ per tonne) 60.89 56.08 65.09 72.56 64.47 Cash Milling Cost ($ per tonne) 16.00 14.89 12.06 16.05 12.61 Total Milling Cost ($ per tonne) 18.60 17.29 13.62 18.61 14.20 ---------------------------------------------------------------------------- Cash Cost per Ounce of Silver ($) 2.00 0.49 3.23 3.65 (0.17) Total Production Cost per Ounce of Silver ($) 4.39 3.41 5.33 5.82 1.52 ----------------------------------------------------------------------------



2. BYP Mine, Hunan Province, China

In Q3 Fiscal 2014, the BYP mine processed 19,574 tonnes of ore compared to 32,699 tonnes in Q3 Fiscal 2013. During the same comparative periods, the Company sold 1,050 ounces of gold at a cash cost per ounce of gold of $502 compared to 4,309 ounces of gold at a cash cost per ounce of gold of $266, respectively. Gold head grade for Q3 Fiscal 2014 was 2.7 g/t compared to 3.7 g/t in Q3 Fiscal 2013. In Q3 Fiscal 2014, total and cash mining costs per tonne were $53.22 and $22.81 compared to $70.48 and $24.72 in Q3 Fiscal 2013, respectively.

DEVELOPMENT AND EXPLORATION

1. Ying Mining District, Henan Province, China

As at the end of Q3 Fiscal 2014, approximately 2,500 metres ("m") of the development work for the 4,800m access ramp at the LM Mine West are complete.

During the quarter, the Company also completed approximately 18,000m of horizontal tunnels, raises and declines. During the quarter the Company decided to suspend the construction of Shaft 969 at LM Mine West and certain other surface facilities within the Ying Mining District to better allocate resources during the current market.

In Q3 Fiscal 2014, exploration and development expenditures for the Ying Mining District were $8.5 million compared to $9.1 million in Q3 Fiscal 2013. For the nine months ended December 31, 2013, exploration and development expenditures for the Ying Mining District were $26.7 million compared to $28.1 million in the same prior year period.

2. GC Project, Guangdong Province, China

The required surface environmental protection facilities together with water and soil conservation engineering work are complete and have undergone test operations. During the quarter, the concrete rooms for the pumping station and underground main power station at the -50m elevation was completed and the pumps and pipes were installed, which represented the key component prior to the safety inspection, in accordance with safety requirements in the Mine Design.

A temporary Safety Production Permit, valid until the end of June 2014, has been issued to the Company, which allows the Company to conduct trial mine production. A final Safety Production Permit is expected to be issued around the end of June 2014. Before obtaining the Safety Production Permit and commencing significant mining, in the next few quarters, the Company will focus on trial mining and stope preparation work.

As the Company has completed the first phase of mine development and moves to trial mine production, the existing mine contractor, which was originally contracted to carry out mine development, was terminated and is being replaced with a mining contractor specializing in longhole and shrinkage stope mining. Transitioning to the new contractor will take some time and may cause some delays to the start-up of the trial mining.

The Company continued to use development ore to test mill equipment and to fine tune the mill circuits to achieve the desired metallurgical recoveries for silver, lead, zinc, tin, and sulphur. The testing process has identified numerous issues and many improvements were made in the mill circuits. While the floatation test results are approaching the designed recovery rates for silver (60%), lead (85%), zinc (86%), and sulphur, the gravity circuit only recovers approximately 5% tin, significantly lower than the 40% recovery rate in the metallurgic tests. The Company will focus on improving the tin recovery in the next several months.

The tailing dewatering facility for dry stacking has also been improved with modifications to equipment achieving desired results. The construction of the tailing dry stacking dam and reservoir facility has been completed and has passed government inspection.

During Q3 Fiscal 2014, approximately 4,800m of tunnels, including 700m of development tunnels, 2,000m of exploration tunnels and 2,100m of mining preparation tunnels, were completed.

In Q3 Fiscal 2014, $4.6 million (Q3 Fiscal 2013 - $4.7 million) of exploration and development expenditures were incurred at the GC mine. For the nine months ended December 31, 2013, $13.9 million (nine months ended December 31, 2012 - $10.9 million) of exploration and development expenditures were incurred at the GC mine.

3. BYP Mine, Hunan Province, China

In Q3 Fiscal 2014, the construction of the head frame continued. Once completed, the newly completed shaft will facilitate mining of the #3 gold mineralization body and the #5 zinc and lead ore body. In addition, the construction of a 1,500 t/d tailings-backfill facility is complete and trial runs are ongoing. Exploration and development expenditures at the BYP mine were $1.3 million in the current fiscal year compared to $4.6 million in the prior year.

4. X Mines, Henan Province, China

The X Mines consist of two mining projects: the XBG project and XHP project.

During the nine months ended December 31, 2013, the Company entered into a share transfer agreement with an arm's length private Chinese company. Pursuant to the agreement, the Company's subsidiary, Henan Found Mining Co. Ltd., sold its 90% equity interest in Zhongxing Mining Co. Ltd. (XBG project) for $12.5 million (RMB 76 million). This transaction was completed in this quarter.

Since the end of the first quarter, the Company has suspended major activities at the XHP project as part of its cost saving measures.

QUARTERLY DIVIDEND

To maintain the Company's strong balance sheet and liquidity during the current lower metal price environment, on February 12, 2014, the Board of Directors decided to reduce the quarterly dividend from CAD$0.025 to CAD$0.005 per share per quarter. This measure will save the Company approximately $12 million over the next full year, and ensure that the Company remains in a strong position to act on opportunities that develop in the current downturn. The declaration and payment of future dividends is at the discretion of the Board of Directors and any future decision to increase, or eliminate dividend payments will be based on a number of factors including commodity prices, market conditions, financial results, cash requirements and other relevant factors.

Myles Gao, P.Geo., President & CEO, is the Qualified Person for Silvercorp under NI 43-101 and has reviewed and given consent to the technical information contained in this News Release.

This earnings release should be read in conjunction with the Company's Management Discussion & Analysis, Financial Statements and Notes to Financial Statements for the corresponding period, which have been posted on SEDAR at www.sedar.com and are also available on the Company's website at www.silvercorp.ca. All figures are in United States dollars unless otherwise stated.

About Silvercorp

Silvercorp is a low-cost silver-producing Canadian mining company with multiple mines in China. The Company is currently developing the GC project in southern China which it expects will become its next operating mine. The Company's vision is to deliver shareholder value by focusing on the acquisition of under developed projects with resource potential and the ability to grow organically. For more information, please visit our website at www.silvercorp.ca.

CAUTIONARY DISCLAIMER - FORWARD LOOKING STATEMENTS

Certain of the statements and information in this press release constitute "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 provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "is expected", "anticipates", "believes", "plans", "projects", "estimates", "assumes", "intends", "strategies", "targets", "goals", "forecasts", "objectives", "budgets", "schedules", "potential" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information. Forward-looking statements or information relate to, among other things: the price of silver and other metals; the accuracy of mineral resource and mineral reserve estimates at the Company's material properties; the sufficiency of the Company's capital to finance the Company's operations; estimates of the Company's revenues and capital expenditures; estimated production from the Company's mines in the Ying Mining District; timing of receipt of permits and regulatory approvals; availability of funds from production to finance the Company's operations; and access to and availability of funding for future construction, use of proceeds from any financing and development of the Company's properties.

Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks relating to: fluctuating commodity prices; calculation of resources, reserves and mineralization and precious and base metal recovery; interpretations and assumptions of mineral resource and mineral reserve estimates; exploration and development programs; feasibility and engineering reports; permits and licences; title to properties; property interests; joint venture partners; acquisition of commercially mineable mineral rights; financing; recent market events and conditions; economic factors affecting the Company; timing, estimated amount, capital and operating expenditures and economic returns of future production; integration of future acquisitions into the Company's existing operations; competition; operations and political conditions; regulatory environment in China and Canada; environmental risks; foreign exchange rate fluctuations; insurance; risks and hazards of mining operations; key personnel; conflicts of interest; dependence on management; internal control over financial reporting as per the requirements of the Sarbanes-Oxley Act; and bringing actions and enforcing judgments under U.S. securities laws.

This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements or information. Forward-looking statements or information are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements or information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company's Annual Information Form for the year ended March 31, 2013 under the heading "Risk Factors". Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information.

The Company's forward-looking statements and information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this press release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements and information if circumstances or management's assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information. For the reasons set forth above, investors should not place undue reliance on forward-looking statements and information.

SILVERCORP METALS INC. Condensed Consolidated Interim Balance Sheets ---------------------------------------------------------------------------- (Unaudited) (Expressed in thousands of U.S. dollars) December 31, 2013 March 31, 2013 ---------------------------------------------------------------------------- ASSETS Current Assets Cash and cash equivalents $ 79,561$ 72,283 Short-term investments 18,428 45,623 Trade and other receivables 6,019 1,442 Inventories 6,073 7,522 Due from related parties 23 123 Prepaids and deposits 5,446 5,118 ---------------------------------------------------------------------------- 115,550 132,111 Non-current Assets Long-term prepaids and deposits 2,053 1,877 Investment in an associate 6,080 6,523 Other investments 11,417 15,516 Plant and equipment 104,922 103,517 Mineral rights and properties 268,107 316,678 ---------------------------------------------------------------------------- TOTAL ASSETS $ 508,129$ 576,222 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- LIABILITIES AND EQUITY Current Liabilities Accounts payable and accrued liabilities $ 32,143$ 29,285 Deposits received 8,961 11,497 Dividends payable 4,017 4,204 Income tax payable 1,224 1,349 Due to related parties 1,640 1,207 ---------------------------------------------------------------------------- 47,985 47,542 Non-current Liabilities Deferred income tax liabilities 15,755 24,603 Environmental rehabilitation 6,108 5,974 ---------------------------------------------------------------------------- Total Liabilities 69,848 78,119 ---------------------------------------------------------------------------- Equity Share capital 233,503 233,082 Share option reserve 10,051 8,314 Reserves 25,409 24,717 Accumulated other comprehensive loss (927) (1,495) Retained earnings 106,307 155,817 ---------------------------------------------------------------------------- Total equity attributable to the equity holders of the Company 374,343 420,435 Non-controlling interests 63,938 77,668 ---------------------------------------------------------------------------- Total Equity 438,281 498,103 ---------------------------------------------------------------------------- TOTAL LIABILITIES AND EQUITY $ 508,129$ 576,222 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- SILVERCORP METALS INC. Condensed Consolidated Interim Statements of Income ---------------------------------------------------------------------------- (Unaudited) (Expressed in thousands of U.S. dollars, except for per share figures) Three Months Ended Nine Months Ended December 31, December 31, -------------------------------------------------------- 2013 2012 2013 2012 ---------------------------------------------------------------------------- Sales $ 23,970$ 58,717$ 92,265$ 148,475 Cost of sales 13,501 21,241 50,806 57,029 ---------------------------------------------------------------------------- Gross profit 10,469 37,476 41,459 91,446 General and administrative 6,338 6,445 20,893 19,482 General exploration and property investigation 654 1,345 2,466 3,198 Other taxes 408 854 1,575 2,502 Foreign exchange gain (1,667) (697) (2,750) (332) Loss on disposal of plant and equipment 21 60 144 85 Loss on disposal of mineral rights and properties 181 - 181 - Share of loss in associate - 42 153 231 Impairment on associate - 9,640 - 9,640 Impairment of mineral rights and properties - - 66,573 - Loss on investments 65 78 608 671 Other income 39 (214) (117) (382) ---------------------------------------------------------------------------- Income (loss) from operations 4,430 19,923 (48,267) 56,351 Finance income 1,047 999 2,953 2,841 Finance costs (33) (24) (99) (69) ---------------------------------------------------------------------------- Income (loss) before income taxes 5,444 20,898 (45,413) 59,123 Income tax expense (recovery) 2,300 10,267 (1,734) 25,471 ---------------------------------------------------------------------------- Net income (loss) $ 3,144$ 10,631$ (43,679)$ 33,652 ---------------------------------------------------------------------------- Attributable to: Equity holders of the Company $ 2,163$ 5,236$ (36,476)$ 20,850 Non-controlling interests 981 5,395 (7,203) 12,802 ---------------------------------------------------------------------------- $ 3,144$ 10,631$ (43,679)$ 33,652 ---------------------------------------------------------------------------- Earnings (loss) per share attributable to the equity holders of the Company Basic earnings (loss) per share $ 0.01$ 0.03$ (0.21)$ 0.12 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Diluted earnings (loss) per share $ 0.01$ 0.03$ (0.21)$ 0.12 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Weighted Average Number of Shares Outstanding - Basic 170,878,775 170,748,449 170,813,858 170,720,668 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Weighted Average Number of Shares Outstanding - Diluted 170,925,150 171,072,001 170,813,858 171,072,034 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- SILVERCORP METALS INC. Condensed Consolidated Interim Statements of Cash Flow ---------------------------------------------------------------------------- (Unaudited) (Expressed in thousands of U.S. dollars) Three Months Ended Nine Months Ended December 31, December 31, ------------------------ ----------------------- 2013 2012 2013 2012 ---------------------------------------------------------------------------- Cash provided by Operating activities Net income (loss) $ 3,144$ 10,631$ (43,679)$ 33,652 Add (deduct) items not affecting cash: Unwinding of discount of environmental rehabilitation 33 24 99 69 Depreciation, amortization and depletion 2,936 4,463 11,418 11,653 Share of loss in associate - 42 153 231 Impairment on associate - 9,640 - 9,640 Impairment of mineral rights and properties - - 66,573 - Write down of inventories - - - 348 Income tax expense (recovery) 2,300 10,267 (1,734) 25,471 Loss on investments 65 78 608 671 Loss on disposal of plant and equipment 21 60 144 85 Loss on disposal of mineral rights and properties 181 - 181 - Share-based compensation 561 546 1,878 2,154 Income tax paid (2,111) (7,948) (5,461) (22,323) Changes in non-cash operating working capital 2,743 20 2,948 9,341 ---------------------------------------------------------------------------- Net cash provided by operating activities 9,873 27,823 33,128 70,992 ---------------------------------------------------------------------------- Investing activities Mineral rights and properties Capital expenditures (15,922) (15,442) (42,527) (41,855) Proceeds on disposals 13,349 - 13,349 - Plant and equipment Additions (1,604) (7,138) (13,031) (24,723) Proceeds on disposals 1,418 - 1,418 - Other investments Acquisition - - - (595) Net redemptions (purchases) of short-term investments 4,257 (13,884) 26,894 (16,239) Proceeds on sale of a subsidiary (net of cash disposed, $4) 3,274 - 8,160 - ---------------------------------------------------------------------------- Net cash provided by (used in) investing activities 4,772 (36,464) (5,737) (83,412) ---------------------------------------------------------------------------- Financing activities Related parties Payments made (320) (16) (1,642) (365) Repayments received 102 313 317 972 Non-controlling interests Distribution (5,168) (7,224) (5,168) (14,612) Cash dividends distributed (4,148) (4,295) (12,438) (12,820) Proceeds from issuance of common shares 192 126 280 239 ---------------------------------------------------------------------------- Net cash used in financing activities (9,342) (11,096) (18,651) (26,586) ---------------------------------------------------------------------------- Effect of exchange rate changes on cash and cash equivalents (1,821) 1,239 (1,462) (118) ---------------------------------------------------------------------------- Increase (decrease) in cash and cash equivalents 3,482 (18,498) 7,278 (39,124) Cash and cash equivalents, beginning of the period 76,079 89,334 72,283 109,960 Cash and cash equivalents included in assets held for sale - (1,818) - (1,818) ---------------------------------------------------------------------------- Cash and cash equivalents, end of the period $ 79,561$ 69,018$ 79,561$ 69,018 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- SILVERCORP METALS INC. Mining Data ---------------------------------------------------------------------------- (Expressed in thousands of U.S. dollars, except for mining data figures) ---------------------------------------------------------------------------- Three months ended December 31, 2013 ----------------------------------- Ying Mining District (1) X Mines(2) BYP Total ---------------------------------------------------------------------------- Production Data Mine Data Ore Mined (tonne) Direct Smelting Ore (tonne) 715 - - 715 Stockpiled Ore (tonne) 148,135 - 20,690 168,825 ----------------------------------- 148,850 - 20,690 169,540 ----------------------------------- Run of Mine Ore (tonne) Direct Smelting Ore (tonne) 715 - - 715 Ore Milled (tonne) 149,040 3,496(i) 19,574 172,110 ----------------------------------- 149,755 3,496 19,574 172,825 ----------------------------------- Mining cost per tonne of ore mined ($) 60.89 - 53.22 59.95 Cash mining cost per tonne of ore mined ($) 50.59 - 22.81 47.20 Non cash mining cost per tonne of ore mined ($) 10.30 - 30.41 12.75 Unit shipping costs ($) 4.06 - - 3.57 Milling cost per tonne of ore milled ($) 18.60 - 15.31 18.22 Cash milling cost per tonne of ore milled ($) 16.00 - 13.76 15.74 Non cash milling cost per tonne of ore milled ($) 2.60 - 1.55 2.48 Average Production Cost Silver ($ per ounce) 8.83 - - 9.12 Gold ($ per ounce) 483 - 959 532 Lead ($ per pound) 0.42 - - 0.44 Zinc ($ per pound) 0.34 - - 0.35 Total production cost per ounce of Silver ($) 4.39 - 4.39 Total cash cost per ounce of Silver ($) 2.00 - 2.00 Total production cost per ounce of Gold ($) 959 959 Total cash cost per ounce of Gold ($) 502 502 Total Recovery of the Run of Mine Ore Silver (%) 93.1 - 93.1 Gold (%) 92.7 92.7 Lead (%) 95.7 - 95.7 Zinc (%) 64.2 - 64.2 Head Grades of Run of Mine Ore Silver (gram/tonne) 202 - 202 Gold (gram/tonne) 2.7 2.7 Lead (%) 2.9 - 2.9 Zinc (%) 0.7 - 0.7 Sales Data Metal Sales Silver (in thousands of ounces) 883 2(i) - 885 Gold (in thousands of ounces) 0.9 - 1.1 2.0 Lead (in thousands of pounds) 8,814 186(i) - 9,000 Zinc (in thousands of pounds) 1,572 100(i) - 1,672 Metal Sales Silver (in thousands of $) 14,304 - - 14,304 Gold (in thousands of $) 808 - 1,045 1,853 Lead (in thousands of $) 6,824 - - 6,824 Zinc (in thousands of $) 989 - - 989 ----------------------------------- 22,925 - 1,045 23,970 ----------------------------------- Average Selling Price, Net of Value Added Tax and Smelter Charges Silver ($ per ounce) 16.20 - - 16.20 Gold ($ per ounce) 887 - 995 945 Lead ($ per pound) 0.77 - - 0.77 Zinc ($ per pound) 0.63 - - 0.63 (1) Ying Mining District includes mines: SGX, TLP, HPG&LM. (2) X Mines includes the XHP project. (i) Represents development tunnelling ore at the X mines. SILVERCORP METALS INC. Mining Data ---------------------------------------------------------------------------- (Expressed in thousands of U.S. dollars, except for mining data figures) ---------------------------------------------------------------------------- Three months ended December 31, 2012 ----------------------------------- Ying Mining District (1) X Mines(2) BYP Total ---------------------------------------------------------------------------- Production Data Mine Data Ore Mined (tonne) Direct Smelting Ore (tonne) 2,334 - - 2,334 Stockpiled Ore (tonne) 234,360 8,932(i) 35,558 278,850 ----------------------------------- 236,694 8,932 35,558 281,184 ----------------------------------- Run of Mine Ore (tonne) Direct Smelting Ore (tonne) 2,334 - - 2,334 Ore Milled (tonne) 224,430 27,265(i) 32,699 284,394 ----------------------------------- 226,764 27,265 32,699 286,728 ----------------------------------- Mining cost per tonne of ore mined ($) 64.47 - 70.48 65.26 Cash mining cost per tonne of ore mined ($) 54.92 - 24.72 50.98 Non cash mining cost per tonne of ore mined ($) 9.55 - 45.76 14.28 Unit shipping costs ($) 3.62 - - 3.15 Milling cost per tonne of ore milled ($) 14.21 - 14.38 14.23 Cash milling cost per tonne of ore milled ($) 12.61 - 13.49 12.72 Non cash milling cost per tonne of ore milled ($) 1.60 - 0.89 1.51 Average Production Cost Silver ($ per ounce) 8.53 - - 9.01 Gold ($ per ounce) 409 - 646 418 Lead ($ per pound) 0.27 - - 0.29 Zinc ($ per pound) 0.22 - - 0.23 Total production cost per ounce of Silver ($) 1.52 - 1.52 Total cash cost per ounce of Silver ($) (0.17) - (0.17) Total production cost per ounce of Gold ($) 630 630 Total cash cost per ounce of Gold ($) 266 266 Total Recovery of the Run of Mine Ore Silver (%) 93.3 - 93.3 Gold (%) 92.7 92.7 Lead (%) 95.1 - 95.1 Zinc (%) 70.4 - 70.4 Head Grades of Run of Mine Ore Silver (gram/tonne) 222 - 222 Gold (gram/tonne) 3.7 3.7 Lead (%) 3.2 - 3.2 Zinc (%) 1.0 - 1.0 Sales Data Metal Sales Silver (in thousands of ounces) 1,508 11(i) - 1,519 Gold (in thousands of ounces) 1.3 0.1(i) 4.3 5.7 Lead (in thousands of pounds) 15,642 788(i) - 16,430 Zinc (in thousands of pounds) 3,231 463(i) 283 3,977 Metal Sales Silver (in thousands of $) 37,551 - - 37,551 Gold (in thousands of $) 1,533 - 4,934 6,467 Lead (in thousands of $) 12,480 - - 12,480 Zinc (in thousands of $) 2,061 - 158 2,219 ----------------------------------- 53,625 - 5,092 58,717 ----------------------------------- Average Selling Price, Net of Value Added Tax and Smelter Charges Silver ($ per ounce) 24.90 - - 24.90 Gold ($ per ounce) 1,193 - 1,145 1,155 Lead ($ per pound) 0.80 - - 0.80 Zinc ($ per pound) 0.64 - 0.56 0.63 (1) Ying Mining District includes mines: SGX, TLP, HPG&LM. (2) X Mines includes the XBG project and XHP project. (i) Represents development tunnelling ore at the X mines. SILVERCORP METALS INC. Mining Data ---------------------------------------------------------------------------- (Expressed in thousands of U.S. dollars, except for mining data figures) ---------------------------------------------------------------------------- Nine months ended December 31, 2013 ----------------------------------- Ying Mining District (1) X Mines(2) BYP Total ---------------------------------------------------------------------------- Production Data Mine Data Ore Mined (tonne) Direct Smelting Ore (tonne) 2,181 - - 2,181 Stockpiled Ore (tonne) 533,029 - 67,418 600,447 ----------------------------------- 535,210 - 67,418 602,628 ----------------------------------- Run of Mine Ore (tonne) Direct Smelting Ore (tonne) 2,181 - - 2,181 Ore Milled (tonne) 541,040 10,425(i) 69,621 621,086 ----------------------------------- 543,221 10,425 69,621 623,267 ----------------------------------- Mining cost per tonne of ore mined ($) 61.42 - 54.35 60.63 Cash mining cost per tonne of ore mined ($) 51.02 - 23.48 47.94 Non cash mining cost per tonne of ore mined ($) 10.40 - 30.87 12.69 Unit shipping costs ($) 4.33 - - 3.85 Milling cost per tonne of ore milled ($) 16.07 - 15.35 15.99 Cash milling cost per tonne of ore milled ($) 13.98 - 14.05 13.99 Non cash milling cost per tonne of ore milled ($) 2.09 - 1.30 2.00 Average Production Cost Silver ($ per ounce) 8.94 - - 9.28 Gold ($ per ounce) 503 - 903 570 Lead ($ per pound) 0.41 - - 0.42 Zinc ($ per pound) 0.33 - 0.45 0.34 Total production cost per ounce of Silver ($) 4.47 - 4.47 Total cash cost per ounce of Silver ($) 2.04 - 2.04 Total production cost per ounce of Gold ($) 899 899 Total cash cost per ounce of Gold ($) 473 473 Total Recovery of the Run of Mine Ore Silver (%) 92.6 - 92.6 Gold (%) 92.6 92.6 Lead (%) 95.0 - 95.0 Zinc (%) 67.4 - 67.4 Head Grades of Run of Mine Ore Silver (gram/tonne) 206 - 206 Gold (gram/tonne) 2.9 2.9 Lead (%) 2.8 - 2.8 Zinc (%) 0.9 - 0.9 Sales Data Metal Sales Silver (in thousands of ounces) 3,269 12(i) - 3,281 Gold (in thousands of ounces) 3.1 0.2(i) 5.5 8.8 Lead (in thousands of pounds) 31,397 590(i) - 31,987 Zinc (in thousands of pounds) 6,697 584(i) 282 7,563 Metal Sales Silver (in thousands of $) 55,064 - - 55,064 Gold (in thousands of $) 2,909 - 5,991 8,900 Lead (in thousands of $) 24,006 - - 24,006 Zinc (in thousands of $) 4,141 - 154 4,295 ----------------------------------- 86,120 - 6,145 92,265 ----------------------------------- Average Selling Price, Net of Value Added Tax and Smelter Charges Silver ($ per ounce) 16.85 - - 16.85 Gold ($ per ounce) 949 - 1,084 1,036 Lead ($ per pound) 0.76 - - 0.76 Zinc ($ per pound) 0.62 - 0.55 0.62 (1) Ying Mining District includes mines: SGX, TLP, HPG&LM. (2) X Mines includes the XHP project. (i) Represents development tunnelling ore at the X mines. SILVERCORP METALS INC. Mining Data ---------------------------------------------------------------------------- (Expressed in thousands of U.S. dollars, except for mining data figures) ---------------------------------------------------------------------------- Nine months ended December 31, 2012 ----------------------------------- Ying Mining District (1) X Mines(2) BYP Total ---------------------------------------------------------------------------- Production Data Mine Data Ore Mined (tonne) Direct Smelting Ore (tonne) 7,027 - - 7,027 Stockpiled Ore (tonne) 616,496 19,309(i) 89,759 725,564 ----------------------------------- 623,523 19,309 89,759 732,591 ----------------------------------- Run of Mine Ore (tonne) Direct Smelting Ore (tonne) 7,027 - - 7,027 Ore Milled (tonne) 609,362 58,349(i) 77,862 745,573 ----------------------------------- 616,389 58,349 77,862 752,600 ----------------------------------- Mining cost per tonne of ore mined ($) 65.15 - 60.75 64.60 Cash mining cost per tonne of ore mined ($) 54.53 - 23.86 50.67 Non cash mining cost per tonne of ore mined ($) 10.62 - 36.89 13.93 Unit shipping costs ($) 3.72 - - 3.25 Milling cost per tonne of ore milled ($) 14.64 - 15.10 14.69 Cash milling cost per tonne of ore milled ($) 12.92 - 14.00 13.04 Non cash milling cost per tonne of ore milled ($) 1.72 - 1.10 1.65 Average Production Cost Silver ($ per ounce) 8.69 - - 9.07 Gold ($ per ounce) 425 - 760 452 Lead ($ per pound) 0.29 - - 0.31 Zinc ($ per pound) 0.23 - - 0.24 Total production cost per ounce of Silver ($) 1.66 - 1.66 Total cash cost per ounce of Silver ($) (0.26) - (0.26) Total production cost per ounce of Gold ($) 752 752 Total cash cost per ounce of Gold ($) 356 356 Total Recovery of the Run of Mine Ore Silver (%) 92.6 - 92.6 Gold (%) 92.5 92.5 Lead (%) 94.5 - 94.5 Zinc(%) 67.8 - 67.8 Head Grades of Run of Mine Ore Silver (gram/tonne) 224 - 224 Gold (gram/tonne) 3.1 3.1 Lead (%) 3.4 - 3.4 Zinc (%) 1.1 - 1.1 Sales Data Metal Sales Silver (in thousands of ounces) 4,009 21(i) - 4,030 Gold (in thousands of ounces) 3.4 0.2(i) 7.2 10.8 Lead (in thousands of pounds) 42,757 1,313(i) - 44,070 Zinc (in thousands of pounds) 9,617 574(i) 283 10,474 Metal Sales Silver (in thousands of $) 95,241 - - 95,241 Gold (in thousands of $) 3,894 - 8,667 12,561 Lead (in thousands of $) 34,412 - - 34,412 Zinc (in thousands of $) 6,103 - 158 6,261 ----------------------------------- 139,650 - 8,825 148,475 ----------------------------------- Average Selling Price, Net of Value Added Tax and Smelter Charges Silver ($ per ounce) 23.76 - - 23.76 Gold ($ per ounce) 1,162 - 1,196 1,185 Lead ($ per pound) 0.80 - - 0.80 Zinc ($ per pound) 0.63 - 0.56 0.63 (1) Ying Mining District includes mines: SGX, TLP, HPG&LM. (2) X Mines includes the XBG project and XHP project. (i) Represents development tunnelling ore at the X mines. FOR FURTHER INFORMATION PLEASE CONTACT: Silvercorp Metals Inc.Lorne Waldman Senior Vice President (604) 669-9397 or Toll Free: 1 (888) 224-1881 investor@silvercorp.cawww.silvercorp.ca Source: Silvercorp Metals Inc.


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