U.S. Silver Corporation

U.S. Silver Corporation

November 29, 2007 17:12 ET

U.S. Silver Achieves Progress Towards Milestones; Third Quarter Financial Results

TORONTO, ONTARIO--(Marketwire - Nov. 29, 2007) - U.S. Silver Corporation (TSX VENTURE:USA) ("U.S. Silver" or the "Company") announces its unaudited, consolidated financial results for the quarter ended September 30, 2007. The unaudited, consolidated financial statements and Management's Discussion and Analysis ("MD&A") have been filed on SEDAR and can be viewed at www.sedar.com.

Highlights and Milestones of the 3rd Quarter

- Initiated lead-silver production along with the start-up of the Coeur Mill

- First positive cash flow from operating activities of $647,000

- Forward sale of 2008 lead production near US $1.55/lb

- Galena Shaft repair progressing on schedule

Third Quarter Financial Results

For the period from July 1st, 2007 to September 30, 2007 U.S. Silver generated consolidated revenue of approximately U.S. $4.55 Million. Consolidated cash flow from operating activities was positive for the first time at $647,942. Consolidated net loss for the period was $1.23 million ($0.01 per share), a significant reduction from the $2.7 million net loss ($0.02 per share) in the second quarter of 2007. This reduction was due to the absence of mostly one-time G&A expenses of $1,300,000 in the prior quarter.

The Company produced 265,547 ounces of silver during the 3rd Quarter of 2007 at an average cash cost of U.S. $12.62 per ounce. This compared with 149,646 ounces in the 3rd Quarter, 2006 at cash costs of over U.S. $19.10 per ounce. The headgrades averaged 14.42 oz./sdt up from 12.7 oz./sdt during the 3rd Quarter 2006. The company expects the headgrade to continue to improve through 2007 and 2008 as newer and more efficient stopes are accessed.

U.S. Silver's balance sheet at September 30, 2007 showed over U.S. $10.78 million in working capital and approximately $43 million in total assets. At September 30, 2007 the Company had no long-term debt and over U.S. $39.5 million in shareholders equity.

Operational Update

In light of historically high lead prices, management decided to redeploy a portion of the Company's work force from mining silver-copper ore to preparations for the start of silver-lead production. Most workers assigned to silver-lead startup tasks have now been reassigned back to silver-copper production. The Third Quarter results were affected by the Company's significant efforts to commence production from lead-silver zones. Production of silver-lead ore started late in the summer and the Coeur mill was restarted in September. Lead-silver concentrate shipments to TeckCominco's Trail Smelter started in October.

Due to these initiatives, the Company was able to capitalize on historically high lead prices and sold forward approximately 6 million pounds of lead at prices above US $1.50/lb for 2008. This represents approximately 50% of the expected lead production in 2008.

The Galena Mine is currently producing over 200 tons/day of lead-silver ore with production growing to over 350 tons/day by the 1st Qtr, 2008. Silver-copper production is also improving and will average over 450 tons/day during the 1st Qtr of 2008. Total production will continue to improve during 2008 as more of the new mining stopes, developed during 2007, are brought into actual production.

Galena Shaft repairs are progressing according to plan with the first portion of the cement lining having been poured at the 2400 level in early November. The Shaft, which will eventually be completely cement lined from the 2400 level down to the 3200 level, is expected to be operational by mid year, 2008. The Shaft will add over 600 tons/day of hoisting capacity and considerably add to the operational flexibility of the Galena mine.

The Company continues to successfully implement a turnaround at the mine, including an extensive redevelopment of new reserves (see press release dated June 5, 2007), a redesign of the mining method in some areas and numerous repairs of facilities and equipment. "The company is well on its way to make 2008 the production turnaround year at the Galena Mine, and with continued strong metal prices we should be profitable by Q1, 2008," stated Mark Hartmann, President of U.S. Silver.

"The milestones achieved during this past quarter demonstrate that the Galena Mine Complex is turning the corner operationally, as well as financially. Management remains confident that all of the work and capital investment that has taken place in the last year to bring the mine back to sustainable profitability will now start to payoff," said Bruce Reid, CEO. "We anticipate returning to net profitability for the 1st quarter of 2008. We expect further improvements in costs and revenues to continue through 2007 and 2008 as production levels at the mine increase."

On November 7, 2007, the Company entered into an agreement to raise $20 million, by way of a private placement of shares and share warrants on a "bought deal" basis. This financing is expected to close on December 5, 2007 (Please see press release dated November 7, 2007).


U. S. Silver owns and operates the Galena, Coeur, and Caladay silver-lead-copper mines in Shoshone County, Idaho, with the Galena mine being the second most prolific silver producer in US history. Total silver production from U.S. Silver's mining complex has exceeded 210 million ounces of silver production since 1953. U.S. Silver controls a land package now totaling approximately 18,000 acres in the heart of the Coeur d'Alene Mining District. U.S. Silver is focused on expanding its production from existing operations as well as exploring its extensive Silver Valley holdings.

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which filings are available at www.sedar.com.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • U.S. Silver Corporation
    Bruce Reid
    Chief Executive Officer
    (416) 848-0858
    U.S. Silver Corporation
    Vance Loeber
    Investor Relations
    (604) 805-3530