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SilverCrest Mines | Corporate Presentation | December 2013
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SilverCrest Mines | Corporate Presentation | December 2013

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SilverCrest Mines Inc. (TSX‐V: SVL; NYSE MKT: SVLC) is a Canadian precious metals producer headquartered in Vancouver, BC. SilverCrest’s flagship property is the 100%‐owned Santa Elena Mine, located …

SilverCrest Mines Inc. (TSX‐V: SVL; NYSE MKT: SVLC) is a Canadian precious metals producer headquartered in Vancouver, BC. SilverCrest’s flagship property is the 100%‐owned Santa Elena Mine, located 150 km northeast of Hermosillo, near Banamichi in the State of Sonora, México. The mine is a high‐grade, epithermal gold and silver producer, with an estimated life of mine cash cost of US$8 per ounce of silver equivalent (55:1 Ag: Au). SilverCrest anticipates that the 2,500 tonnes per day open pit heap leach facility at the Santa Elena mine should recover approximately 725,000 ounces of silver and 30,000 ounces of gold in 2013. An expansion plan is well underway to significantly increase the annual metals production in 2014 at the Santa Elena Mine (open pit and underground). Exploration programs have rapidly advanced the definition of a large polymetallic deposit at the La Joya property in Durango State with stated resources nearing 200 million ounces of Ag equivalent.


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  • 1. Corporate Presentation December 2013
  • 2. Disclaimer The information provided in this presentation is not intended to be a comprehensive review of all matters and developments concerning the Company. It should be read in conjunction with all other disclosure documents of the Company. The information contained herein is not a substitute for detailed investigation or analysis. No securities commission or regulatory authority has reviewed the accuracy or adequacy of the information presented. FORWARD-LOOKING STATEMENTS This presentation contains “forward‐looking statements” within the meaning of Canadian securities legislation and the United States Securities Litigation Reform Act of 1995. Such forward‐looking statements concern the Company’s anticipated results and developments in the Company’s operations in future periods, planned exploration and development of its properties, plans related to its business and other matters that may occur in the future. These statements relate to analyses and other information that are based on expectations of future performance, including silver and gold production and planned work programs. Statements concerning reserves and mineral resource estimates may also constitute forward‐looking statements to the extent that they involve estimates of the mineralization that will be encountered if the property is developed and, in the case of mineral reserves, such statements reflect the conclusion based on certain assumptions that the mineral deposit can be economically exploited. Forward‐looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward‐looking statements, including, without limitation: risks related to precious and base metal price fluctuations; risks related to fluctuations in the currency markets (particularly the Mexican peso, Canadian dollar and United States dollar); risks related to the inherently dangerous activity of mining, including conditions or events beyond our control, and operating or technical difficulties in mineral exploration, development and mining activities; uncertainty in the Company’s ability to raise financing and fund the exploration and development of its mineral properties; uncertainty as to actual capital costs, operating costs, production and economic returns, and uncertainty that development activities will result in profitable mining operations; risks related to reserves and mineral resource figures being estimates based on interpretations and assumptions which may result in less mineral production under actual conditions than is currently estimated and to diminishing quantities or grades of mineral reserves as properties are mined; risks related to governmental regulations and obtaining necessary licenses and permits; risks related to the business being subject to environmental laws and regulations which may increase costs of doing business and restrict our operations; risks related to mineral properties being subject to prior unregistered agreements, transfers, or claims and other defects in title; risks relating to inadequate insurance or inability to obtain insurance; risks related to potential litigation; risks related to the global economy; risks related to the Company’s status as a foreign private issuer in the United States; risks related to all of the Company’s properties being located in Mexico and El Salvador, including political, economic, social and regulatory instability; and risks related to officers and directors becoming associated with other natural resource companies which may give rise to conflicts of interests. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward‐looking statements. The Company’s forward‐looking statements are based on beliefs, expectations and opinions of management on the date the statements are made. For the reasons set forth above, investors should not place undue reliance on forward‐looking statements. The information contained herein is nota a substitute for detailed investigation or analysis. No securities commission or regulatory authority has reviewed the accuracy or adequacy of the information presented. All monetary figures are expressed in United States dollars unless otherwise specified. Qualified Person Under National Instrument (NI 43-101) Standards of Disclosure for Mineral Projects, the Qualified Person for this presentation is N. Eric Fier, CPG, P.Eng., President & Chief Operating Officer for SilverCrest Mines Inc., who has reviewed and approved its contents. 2
  • 3. SilverCrest – Building The Next Mid-Tier Producer SIMPLE & PROVEN BUSINESS MODEL ROBUST FINANCIAL POSITION SEASONED MANAGEMENT WELL POSITIONED FOR GROWTH MAIN OBJECTIVE • “Phased Approach” • Good access and infrastructure • Low initial cost and systematic exploration • Environmental and community respect • Attractive profit margins; fully funded • Expertise to explore, develop and operate mining projects • Santa Elena: Producing silver gold mine expanding to 3.5 Moz AgEq in 2014 • La Joya: Development Stage Project at PEA stage • Organic Growth Through Low Cost Acquisitions • Build a senior silver-gold producer (+10 Moz AgEq.) through disciplined business strategy 3
  • 4. FOUNDERS Experienced & Successful Management Team J. Scott Drever, BSc., Chairman & CEO (45 years experience) Strategic Planning, Mergers & Acquisitions. Management and operational experience with several production companies, including Placer Dome and Blackdome Mining. N. Eric Fier, CPG, P.Eng., President & COO (25 years experience) Operations, Project Evaluation & Management. Previously with Newmont Mining, Eldorado Gold, Pegasus Gold Corp. Involvement in construction and operations of 4 successful mines, including Santa Elena. Several major international discoveries. Barney Magnusson, CA, CFO (35 years experience) Served as an Officer and Director of 6 mining (Dayton Mines, High River Gold Mines) companies that developed, constructed or operated 8 precious metals mines in North and South America. Brent McFarlane, BSc., VP Operations (25 years experience) Managed all phases of open pit and underground mining projects and instrumental in leading Mexican and Int’l projects through feasibility, construction, and production while working for Minefinders, Kappes Cassiday, TVI Pacific, Marston, and Pegasus Gold. Marcio Fonseca, P.Geo., VP Corporate Development (20 years experience) Served as Division Director at Macquarie Metals & Energy Capital with focus on equity and debt financing for the mining sector over the last 9 years. Prior to that, he held corporate positions in business development, project development, operations and exploration with Vale and Phelps Dodge in Latin America. Graham C. Thody, CA, Director (30 years experience) Corp. finance and public company management. Director and President of UEX Corp., Chairman of the Board of Geologix. George W. Sanders, Director (30 years experience) Experience in mining and exploration finance. Previously with Canaccord Capital Corp., Richmont Mines Inc., Consolidated Cinola Mines Ltd., and Shore Gold Inc. Ross Glanville, P.Eng., CGA, Director (40 years experience) Experience in mining, exploration finance, valuations and fairness opinions. Director of Archon Minerals Limited, Clifton Star Resources Inc. and Starfield Resources Inc. 4
  • 5. Overview of SilverCrest BUILDING THE NEXT MID-TIER SILVER-GOLD PRODUCER IN MEXICO First 9 Months 2013 Production First 9 Months 2013 Cash Cost First 9 Months 2013 Revenues, Earnings, Margin Estimated Production •1,865,222 million Ag Eq oz •550K oz Ag | 21.9K oz Au Reserves Santa Elena (April 30,2013) •$ 7.82 per Ag Eq oz ($430 Au Eq) •$13.15 per Ag Eq oz (ALL IN) Resources* (April 30, 2013) •19.7 million Ag oz •327,430 Au oz •open pit, underground, leach pads •Santa Elena (Underground): •Indicated: 7.9 mill Ag oz, 116,000 Au oz •La Joya: •Inferred: 198.6 million Ag Eq oz •$ 42.03 million (Revenues) •$ 12.8 million (Net Earnings) •30% Asset Stages •1 Operating (Santa Elena) •1 Development – PEA (La Joya) •Exploration properties in Mexico •2013: 2.4 million Ag Eq oz •2014: 3.5 million Ag Eq oz Geographic Location •Mexico: Sonora & Durango NOTE: Ag Eq based on 55:1 ratio 5
  • 6. Capital Structure & Trading History TSX.V SVL SHARE STRUCTURE Issued & Outstanding: Options: Fully Diluted Shares: Average Option Price: 108,918,205 6,250,000 115,168,205 CAD $1.70 MKT 90 - Day Avg. Daily Volume: 52 Week High / Low: 160,403 $2.79 / $1.19 255,797 $2.87/$1.13 Share Price (Nov. 28, 2013): Market Cap: Working Capital (Sept. 30, 2013): Line of Credit (Scotiabank; LIBOR +3%; undrawn) SHAREHOLDER DISTRIBUTIONS Fully Diluted (as of November 18, 2013) NYSE CAD $1.72 CAD $187M $30.9 M $40 M 12 Month Relative Price Performance $2.24 8% $1.64 Management & Directors 32% 60% Institutions Retail $1.20 6
  • 7. Financial Performance Cash Flow per month in first 9 months of $2.3 M Strong Working Capital of $30.9 M Revenue & Cash Flow Working Capital 20.00 10.00 Revenue 5.00 Cash flow Q3 2011 Q4 2011 Q1 2012 ¹ Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 - ¹ Higher grade areas were mined in this quarter. 60 50 40 30 20 10 0 Working Capital Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 ¹ Q1 2013 Q2 2013 Q3 2013 15.00 USD ($ millions) USD ($ millions) 25.00 September 30, 2013 ¹ Higher working capital due to bought deal financing and cash flow from operations. Cash Flow Per Share Earnings Per Share 0.20 0.15 0.15 0.10 0.10 0.05 0.05 0.00 0.00 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2012 2012 2012 2012 2013 2013 2013 Quarterly Cash Flow Per Share - $ Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 Quarterly Earnings Per Share (Basic) - $ 7
  • 8. Cash Operating Cost & ALL IN Cash Operating Cost 2013 EST Budget Cash operating cost ¹ 2012 General and Admin expenses Santa Elena Reserve & Resource definition drilling Santa Elena Sustaining capital $ $ $ $ 19,822,454 7,273,798 4,705,000 901,540 18,307,681 5,568,582 5,644,469 1,703,919 Total 2013 est. expense $ 32,702,792 31,224,651 2,432,136 2,477,623 Ag equiv. ounces sold Cash Cost per Ag equiv. ounce sold $ 8.50 7.39 ALL IN cash cost per Ag equiv. ounce sold ² $ 13.45 12.60 ¹ 2013 EST does not reflect inventory adjustments ² ALL IN” includes total direct costs + sustaining capital + corporate G&A expense + exploration expense. 8
  • 9. Reserve and Resource Growth (AgEq oz*) (Includes Santa Elena, La Joya and Cruz de Mayo) 300,000 250,000 AgEq oz* (000) 200,000 150,000 Reserve Indicated 100,000 Inferred 50,000 0 2006 2007 2008 2009 2010 2011 2012 2013 Reserve 0 0 30,605 30,605 30,605 27,032 21,695 37,743 Indicated 13,805 43,548 10,994 24,782 24,782 39,436 9,163 16,779 Inferred 17,565 25,418 28,005 28,069 28,069 32,866 125,952 223,712 Note: (*) Silver equivalency is based on Ag:Au 55:1 for Santa Elena (Ag Au dore producer) and Cruz de Mayo; for La Joya it includes silver, copper and gold :Ag:Au is 50:1, Ag:Cu is 86:1 (La Joya is a silver copper concentrate with gold credits project at the PEA stage); all numbers are rounded. All Mineral Resources and Reserves conform to NI 43-101, 43-101CP, and CIM definitions for Resources and Reserves. Inferred Resources have been estimated from geological evidence and limited sampling and must be treated with a lower level of confidence than Indicated Resources. Open Pit and Leach Pad Probable Reserves were classified by SilverCrest. Underground Reserves and Resources were classified by EBA, a Tetra Tech Company. 9
  • 10. Santa Elena Historical Production Data 2,500,000 2013 Market Guidance: 2.4 million oz AgEq consisting of 725,000 oz of Ag and 30,000 oz of Au. 45% increase expected in 2014. AgEq oz produced* 2,000,000 1,500,000 Ag oz Produced AgEq oz of Au Produced 1,000,000 500,000 0 2010 2011 2012 2013 (First 9 months 2013) (*) Silver Equivalent ratios (Ag:Au) are as follows: 2010: 46:1 (using Kitco historical metal prices); 2011: 50.4:1; 2012: 54.3:1; 2013: 60.1:1 10
  • 11. Mexico Properties Santa Elena Property 11
  • 12. Santa Elena Mine Expansion 4 Hour Drive to Tucson, AZ 1. SANTA ELENA HIGH GRADE OPEN PIT 2 Hour Drive to Hermosillo and International Airport Access Road to Site; 7km from National HIghway Waste Dumps 3-stage Crusher Future 2nd Underground Access Portal Merrill Crowe Processing Plant And Laboratories Process Plant Construction Ore Reclamation Tunnels Crusher Screen Decks And Conveyors Access road to Underground Portal Excellent Infrastructure and Access 12
  • 13. Santa Elena Open Pit and Underground U/G Development proceeding according to schedule Open Pit Operation 13
  • 14. Santa Elena Expansion - Construction Leaching and CCD Tanks Ball Mill Arrived On Site 14
  • 15. Santa Elena Mine Expansion Plan Capex Schedule ($ Millions) TOTAL 2013 2012 2011 (Budget) Mill Complex 58.7 53.2 5.5 - Underground Development 12.6 8.1 3.5 1.0 Drilling & Pre-Feasibility 10.7 4.7 5.0 1.0 82.0 ⁽*⁾ 66.0 14.0 2.0 (*) Excludes $5 M contingency included in PFS     Pre Feasibility released in July 2013 Decline ramp and UG development in process Construct, 3,000 tonnes per day conventional mill by Q1 2014 Mill feed from Open Pit and Underground/Leach Pads in 2014 15
  • 16. Santa Elena Mine Expansion – Pre-Feasibility Study, April Item Base Case Spot Price 2013 Gold Price (US$/oz.) 1. SANTA ELENA HIGH GRADE OPEN PIT Silver price (US$/oz.) IRR (%) DCF NPV @ 5% in millions Payback (production years) $ 1,450 $ 1,250 $ 28 88% $223.7 1.1 $ 19.5 49% $108.7 1.7 Base Case Economic Analysis Results ¹ - Life of Mine Production Gold Ounces Sold - post refiner Silver Ounces Sold - post refiner Revenue US$(000) Gross Sales Operating Expenses Total Operating Costs ² Freight & Refining Capital Expenses Total Capital Costs ³ Pre-Tax Cash Flow Total Cash Flow ⁴ 262,739 12,118,926 US$(000) $684,931 $282,223 $5,579 $87,813 $302,481 1 The economic analysis considers SilverCrest delivering a remaining 31,000 ounces of gold at a price of US$350/oz. under the Sandstorm Agreement. It does not include the effect of the option held by Sandstorm to participate in the future underground mine production. 2 Operating cost per AgEQ oz. sold varies between $9.6 and $12.6 over the life of mine 3 Excludes sunk costs ,of 24.3 million up to April 30, 2013, closure costs and working capital, including contingency 4 Includes deductions of $5 million for closure costs and $1.8 million for working capital 16
  • 17. Santa Elena Expansion Production Profile (3000 tpd Mill) Long Hole Stoping Upfront 1. SANTA ELENA HIGH GRADE OPEN PIT Long Ag Eq Oz's of Au Produced Ounces 6,000,000 5,000,000 4,000,000 POTENTIAL FOR EXTENDING OR INCREASING PRODUCTION: A) Additional Santa Elena Resources B) La Joya Coming On Stream Currently - Open Pit 7,000,000 Ag Oz's Produced 3,000,000 2,000,000 1,000,000 0 2013 OP/HL 2014 OP/Mill 2015 2016 U/G-HL Blend Expansion #2 2017 2018 2019 2020 2021 Au : Ag - 55:1 NOTE : Production Profile based on “Expansion PFS April 2013” results. An estimated 750,000 tonnes of open pit ore will be placed on the pad in 2013 and accounted for in early 2014 as additional ore for reprocessing during the mine life. 17
  • 18. Santa Elena Mine – El Cholugo and Tortuga Discoveries B Tortug a Underground Ramp El Cholugo A’ A Open Pit Tortuga In Pit Wall B’ Main Mineralized Zone El Cholugo In Pit Wall N 100m 18
  • 19. Santa Elena Mine Expansion – MMZ Long Section A-A’ * Tortuga 5.3 m @ 10.5 gpt Au, 572.5 gpt Ag Original Surface Location Ongoing U/G drilling (1st Production Stopes) Ultimate Pit Current Ramp OPEN 148 155 180 142 158 182 179 161 145 183 168 171 151 152 165 176 173 OPEN 144 OPEN 181 175 160 El Cholugo & El Cholugo Dos 166 OPEN 13.4 m @ 1.8 gpt Au, 207 gpt Ag 1.2 m @ 3.9 gpt Au, 1,239.5 gpt Ag 200m *Looking North – Ultimate pit and U/G development: Est. Reserves in pink and Est. Resources in grey. Drill holes: red dots 2005-2011, blue 2012-13, green stars Newly Reported 19
  • 20. La Joya Project Location: Durango, Mexico Geological Model & Completed Phase I & II Drill Program Conceptual Starter Pit Excellent Infrastructure & Access: Highway, Railway and Power Lines nearby 2 Hour Drive From Durango City & International Airport 20
  • 21. La Joya Preliminary Economic Assessment – Sept. 2013 $350,000,000 $300,000,000 60.0% LA JOYA PRELIMINARY ECONOMIC ASSESSMENT SENSITIVITY ANALYSIS - COMMODITY PRICES PRE TAX NPV - IRR  Pre-tax NPV @ 5% of $133 million and Internal Rate of Return (“IRR”) of 30.5% (Base Case using $22/oz Ag, $1,200/oz Au and $3/lb Cu) 50.0%  Pre-production CAPEX of $141 million, including $17 million contingencies $250,000,000 40.0% NPV @5% VALUE IRR % $200,000,000  Cash cost for the first 3 years average $10 per oz AgEq 30.0%  Pre-tax operating cash flow of $342.5 million; first 4 years averaging $60 million per year 20.0%  9 year LOMP with 15.5 M tonnes grading 50 gpt Ag, 0.33% Cu and 0.19 gpt Au $150,000,000 PRE TAX NPV @ 5% $100,000,000 10.0% $50,000,000 $0 Ag US$/oz Au US$/oz Cu US$/lb BASE CASE - STARTER PIT xxxxxx17.60 xxxxxx19.80 xxxxxx22.00 xxxxx24.20x xxxxx26.40x xxxxx28.60x xxxxxxxx960 xxxxxxx1080 xxxxxx1200 xxxxxx1320x xxxxxx1440x xxxxxx1560x xxxxxxx2.40 xxxxxxx2.70 xxxxxx3.00x xxxxxx3.30x xxxxxx3.60x xxxxxx3.90  LOM production of an est. 34.8 M AgEq oz, consisting of 19 million oz of Ag, 53,000 oz of Au and 93 million lbs of copper in concentrate 0.0%  Production of an attractive high grade silver-copper concentrate (averaging 35% Cu and 4kg/t Ag) with gold credits 21
  • 22. La Joya Resource Estimate & Metallurgy Current Resource Estimate (60 gpt cut-off used for PEA) ZONE Ag Eq* Cut-off gpt Total 15 Tonnage (000) Cu % Ag Eq gpt Ag Oz (000) Au oz (000) Cu lbs (000) Ag Eq* Oz (000) Ag gpt Au gpt 126,700 23.5 0.17 0.19 48.7 95,900 716.2 533,200 198,600 30 71,200 34.4 0.22 0.28 69.8 78,700 524.8 436,800 159,800 60 27,900 57.5 0.28 0.48 112.2 51,600 258.8 288,400 100,800 **Classified by EBA, A Tetra Tech Company and conforms to NI 43-101, 43-101CP, and CIM definitions for resources. All numbers are rounded. Inferred Resources have been estimated from geological evidence and limited sampling and must be treated with a lower level of confidence than Measured and Indicated Resources. Mineralization boundaries used in the interpretation of the geological model and resource estimate are based on a cutoff grade of 15 gpt Ag Eq using the metal price ratios described below. Metallurgical Testing – Baseline* 3RD CLEANER CONCENTRATE (Excluding Leaching) COMPOSITE ORE TYPE HEAD ASSAY ASSAY RECOVERY(%) Cu% Ag g/t Au g/t Cu% Ag g/t Au g/t Cu Ag Au Manto 0.35 47 0.19 36.6 4460 12.9 86 77 55 Structure 0.46 64 0.27 33.7 4300 9.61 84 77 40 (*) Source of metallurgical study results :PEA summary dated Oct 21, 2013. 22
  • 23. La Joya Exploration Potential  10,600 hectare land package within the Fresnillo Silver Trend  Operating mines nearby 23
  • 24. Institutional Holdings Institutional Investors Analyst Coverage Firm Analyst  Sprott Inc  Cormark Securities Graeme Jennings  Libra Advisors  Dundee Capital Chris Lichtenheldt  Wellington Management  Euro Pacific Capital Inc. Heiko Ihle  Haywood Securities Benjamin Asuncion  PI Financial Corp Philip Ker  Raymond James Chris Thompson  Roth Capital Joe Reagor  Stonecap Securities Christos Doulis  AGF Investments  JP Morgan Chase  I.G. Investment Management  Tocqueville Asset Management  683 Capital Management  Great West Life Assurance  BMO Investments  Ingalls & Snyder 24
  • 25. Investment Highlights        Building The Next Mid-Tier Silver-Gold Producer Unhedged High Grade, Low Cost Producer Excellent Profit Margins, Strong Balance Sheet Strong Earnings And Cash Flow Significant Increase In Production by 2014 Good Organic Growth Opportunities Expanding Resources & Reserves Upcoming Catalysts      Annual Production Data & Financial Statements “Meet or Beat” Market Guidance Santa Elena Expansion Updates Santa Elena Exploration Results, incl. U/G drill results Initial Mill Start Up in Q1 2014 Above: Crushing and Screening Area | Below: Santa Elena Construction 25
  • 26. Peer Comparables – AgEq All-In Cash Costs 35 31.02 30 All-in cash costs (US$/oz) 30.50 30.83 27.91 25.72 25.32 25 23.55 25.16 24.59 23.25 22.07 20.74 20 21.00 20.97 19.89 17.86 17.64 16.47 25.13 14.49 15 12.72 10 6.32 6.02 5.86 5 0 SLW SVL EDR FR Q1 PAA Q2 FVI CDE SSO Q3 Source: Dundee Capital Markets, “Silver Equities” report dated November 25, 2013 26
  • 27. Contact Us Tel: (604) 694-1730 Toll Free: 1-866-691-1730 Fax: (604) 694-1761 info@silvercrestmines.com www.silvercrestmines.com SILVERCRESTMINES.COM MEDIA PRESENTATIONS Scan the QR codes above for more info. Get the FREE mobile app: http://gettag.mobi Suite 501 - 570 Granville Street Vancouver, BC V6C 3P1 27