Company reports highest throughput and second highest metals production in its history.
Third quarter consolidated highlights:
•Revenue of US$40.8 million vs US$28.4 million in Q3 2015
•Adjusted EBITDA of US$16.3 million vs US$2.0 million in Q3 2015
•Company reports highest quarterly throughput in its history with 536,553 tonnes processed and the second highest quarterly metals production with silver equivalent production of 3.2 million ounces vs. 2.6 million ounces or copper equivalent production of 21.3 million pounds vs. 17.0 million pounds in Q3 2015
•Benefits of the operational improvement process at its Yauricocha Mine continue with the Company realizing an 8% increase in silver equivalent production and copper equivalent production compared to Q2 2016 due to the continued focus on the mining of higher value ore and the return to normalized operations at the Mine
•All in sustaining cost ("ASIC") per silver equivalent payable ounce was 19% lower at US$11.80 at Yauricocha and at Bolivar the AISC per copper equivalent payable pound 42% lower at US$1.90
•Record throughput at both the Yauricocha and Bolivar Mines during Q3 2016
•US$30.3 million of cash and cash equivalents (includingUS$3.1 million of restricted cash) as at September 30, 2016
•Conference Call to be held November 17th at 10:00 AM (EST)


TORONTO, Nov. 14, 2016 /PRNewswire/ - Sierra Metals Inc. (TSX:SMT)(BVL:SMT) ("Sierra Metals" or the "Company") today reported revenue of $40.8 million and adjusted EBITDA of $16.3 million on throughput of 536,553 tonnes and metal production of 3.2 million silver equivalent ounces or 21.3 million copper equivalent pounds during Q3 2016.

Sierra Metals had an exceptional third quarter and benefited from the continued rise in metal prices. The Company saw significant improvements in revenue and adjusted EBITDA combined with lower AISC costs in the third quarter. This was largely attributable to the completion of key aspects of the operational improvements program and a return to normalized operations at the Yauricocha Mine in Peru, which had record throughput this quarter. The Company achieved excellent year over year improvement in the third quarter with revenue up 43%, adjusted EBITDA up 708% and the ASIC per silver equivalent payable ounce lower by 19% to US$11.80 at the Yauricocha Mine. Also, the AISC per copper payable equivalent pound was lower by 42% to US$1.90 at the Bolivar Mine in Mexico.

The Company continued to benefit from improvements on a quarter by quarter basis (Q3 vs Q2 2016). Revenue was up 11%, adjusted EBITDA was up 209% and the ASIC per silver equivalent payable ounce was 17% lower at Yauricocha and the AISC per copper equivalent payable pound was 21% lower at Bolivar. The Company has continued to focus on the production of higher value ore, reducing costs and optimization programs at all three Mines to improve the production, operating margins and cash flow generation.

At the Bolivar Mine in Mexico, the Company had another quarter of record plant throughput in Q3 2016 with a 21% increase compared to Q3 2015. The record throughput and higher recoveries for all metals helped offset the lower head grades encountered for all metals and resulted in a 10% increase in copper equivalent production in Q3 2016 compared to Q3 2015. The Company expects to see improved production with higher throughput, better head grades and higher recoveries into 2017 by concentrating on the development and extraction of higher grade material from known mineralized areas within the Bolivar concession.

The Cusi project, also in Mexico, realized a 6% decrease in plant throughput in Q3 2016 over Q3 2015 however, the AISC per silver equivalent payable ounce decreased to $19.22 in Q3 2016 compared to $37.49 in Q3 2015. Higher head grades for gold and lead combined with higher recoveries for all metals (except silver) and the start of zinc concentrate production during Q1 2016 helped offset the decrease in throughput which resulted in a 10% decrease in silver equivalent production.

"The Company had a tremendous third quarter, achieving historic record production and realizing significant increases in revenue and cash flow while benefiting from lower operating costs and improved metal prices" stated Mark Brennan, President and CEO of Sierra Metals. "The operational improvements program at Yauricocha has been a great success and when matched with a continued focus on higher value ore production at all three Mines, the Company has witnessed a significant impact on its operating margins and cash flows. This can be seen by a 25% increase in silver equivalent ounce production year over year and an 8% increase over the previous quarter--which was the second highest quarter of metal production in the history of the Company. This resulted in significant increases in revenue and adjusted EBITDA and lower AISC per silver equivalent ounce."

He continued "We saw another record quarter of throughput at Bolivar however we encountered lower head grades. We believe that we will see higher metal production as we define and begin accessing higher grade ore zones. At Cusi, silver equivalent production decreased 10% over the same quarter last year however AISC per silver equivalent payable ounce was 49% lower. Sierra Metals continues to have a strong balance sheet and strong liquidity to drive operations. Continual operational improvements and successful brownfield exploration programs will drive substantial resource production growth and reduce costs at all three of the Company's Mines benefitting all shareholders."

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