Endeavour Silver Corp.
FRANKFURT : EJD
TSX : EDR
AMEX : EXK

Endeavour Silver Corp.

August 13, 2008 17:34 ET

Endeavour Silver Reports Financial and Operating Results for Second Quarter, 2008; Revenues Up 58%, Production Up 20% from 2007

Teleconference Scheduled for Thursday, August 14, 10 AM PDT

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 13, 2008) - Endeavour Silver Corp. (TSX:EDR)(AMEX:EXK)(FRANKFURT:EJD) announced today its financial and operating results for the Second Quarter 2008. The financial results are expressed in US dollars (US$) and are based on Canadian generally accepted accounting practices. For a more detailed review, shareholders can view the complete financial statements and management discussion and analysis at the Company's website, www.edrsilver.com and on the SEDAR website, www.sedar.ca.

Highlights Q2 2008

- Mineral sales jumped by 58% to $10.1 million compared to Q2, 2007.

- Silver production rose by 20% to 517,077 oz compared to Q2, 2007.

- Mine operating earnings climbed 171% to $1.9 million compared to Q2, 2007.

- Cash costs dropped 1% to $9.62 per oz, compared to Q2, 2007, and fell 4% lower than Q1, 2008.

- Mine output, plant throughput, silver production, grades and recoveries at the Guanajuato Mines project in Guanajuato were all sharply higher and cash costs were sharply lower compared to Q2, 2007.

- Overhead costs also declined, general and administrative by 22% and stock-based compensation by 80%, compared to Q2, 2007.

- Working capital at the end of Q2, 2008 was $16.8 million including $10.7 million in cash, cash equivalents and marketable securities.

- Discovered several new high grade silver zones in San Pedro area by drilling at Guanacevi Mines project in Durango.

- Extended new "3785" gold-silver mineralized zone by drilling at Guanajuato.

Bradford Cooke, Chairman and CEO, commented, "Endeavour continued to grow its silver production, reduce cash costs and advance its numerous capital expansion and upgrade projects in Q2, 2008. Silver production and cash costs are expected to improve again in the 3rd quarter as various capital projects are completed. As shown by the tremendous progress achieved at Guanajuato in the 2nd quarter, the Company's expansion and upgrade programs should continue to positively impact production output and cash costs in the second half of the year. Endeavour also enjoyed good success in its exploration drilling programs in Q2, 2008 intersecting several new high grade silver veins in the prospective San Pedro area at Guanacevi. Management anticipates reporting on substantial progress from its exploration and acquisition programs in Mexico over the next two quarters. The Company currently has four drills working on three of its silver projects."

The Company realized mineral sales of $10.1 million and mine operating earnings of $1.9 million from its mining and milling operations for the Second Quarter, 2008. Endeavour's average realized silver price was $18.12 per oz sold in Q2, 2008, 33% higher than Q2, 2007, which combined with increased production helps explain the jump in mineral sales. Cost of sales was $6.4 million and depreciation and depletion of $1.8 million.

The Operating Loss for the three months ended June 30, 2008 was $2.8 million after exploration costs of $2.7 million, general and administrative costs of $1.4 million and stock based compensation costs of $0.7 million. The Loss Before Taxes for the three months ended June 30, 2008 was $2.4 million after foreign exchange gain of $0.1 million, realized gains on marketable securities of $0.2 million and investment and other income of $0.1 million. The Company incurred a Net Loss ended Q2, 2008 of $3.4 million after Income Tax Provision of $1.1 million.

Consolidated silver production for Q2, 2008 was 517,077 oz, up 2% compared to Q1, 2008 and up 20% compared to Q2, 2007. Guanajuato silver production doubled to 97,832 oz in the 2nd quarter, 2008 compared to both the 1st quarter, 2008 and the 2nd quarter, 2007 thanks to the completion of major mine rehabilitation and safety upgrade programs that allowed the main production shafts to come back into operation in June 2008. Guanacevi silver production fell slightly to 419,245 oz in the 2nd quarter, 2008, down 9% compared to the 1st quarter, 2008 due to lower plant throughputs as a result of the ongoing plant upgrade capital program and lower silver grades, but up 10% compared to the 2nd quarter, 2007 due to higher plant throughputs.

The consolidated plant throughput rate increased to 998 tpd in Q2, 2008 compared to 881 tpd in Q1, 2008 and 645 tpd in Q2, 2007, and is expected to continue climbing in Q3, 2008. Consolidated silver ore grades decreased to 257 gpt silver in Q2, 2008 compared to 304 gpt silver in Q1, 2008 and 290 gpt silver in Q2, 2007 but they are expected to rebound higher in Q3, 2008. Consolidated silver recoveries increased 10% to 72.8% in Q2, 2008 compared to 66.2% in Q1, 2008, they were 3% lower compared to 74.8% in Q2, 2007, and they are expected to continue improving in Q3, 2008, thanks to the various plant capital projects.

Consolidated cash costs were $9.62 per oz, per oz produced in Q3, 2008, down 4% compared to $10.01 in Q1, 2008 and down 1% compared to $9.67 in Q2, 2007. Guanajuato cash costs fell by half to $12.75 in the 2nd quarter, 2008 compared to the 1st quarter, 2008 thanks to the sharp rise in silver production after the main production shafts came back into operation in June 2008 and they are expected to continue falling in Q3, 2008. Guanacevi cash costs rose slightly to $8.92 in the 2nd quarter 2008 compared to the 1st quarter, 2008 due to the decrease in plant throughput and silver grade but they are both expected to increase in Q3, 2008.

Endeavour invested $4.4 million on capital projects in Q2, 2008, including $2.2 million on underground mine development, rehabilitation and safety upgrades, $1.5 million on expanding and improving various plant and tailings circuits, and $0.7 million on buildings and vehicles. Most of these investments were made at Guanacevi, to expand the mine output, and enhance the plant capacity and improve metal recoveries. The Company also completed a major mine rehabilitation and safety upgrade program at Guanajuato to bring the production shafts up to North American standards.

Three drill holes at Santa Cruz have extended the mineralized zone an additional 100 m down-dip to the north-east, where it remains open for expansion. Highlights include 71 gpt silver, 0.2 gpt gold, 1.30% lead and 2.64% zinc over a 9.56 m true width in hole SC2-1.

Seven drill holes at El Cometa have better defined this mineralized zone for mine planning and economic analysis. Highlights include 38 gpt silver, 0.8 gpt gold, 4.8% lead, 4.9% zinc over a 4.44 m true width in hole CM14-5.

Seven of the 12 drill holes at San Pedro intersected economically interesting silver mineralization in five separate target areas spread over a 3.0 km x 1.5 km area. Each of the five target areas is wide open for expansion. Highlights include 6,680 gpt silver, 11.2 gpt gold, 1.49% lead, 2.52% zinc over a 0.58 m true width in hole EPS3-1.

A conference call to discuss the Q2, 2008 financial results will be held at 10:00 AM Pacific Time (1:00 PM Eastern Time) on Thursday August 14, 2008.

To participate in the conference call, please dial the following:

- 1-800-396-7098 Canada & USA (Toll-Free)

- 416-620-3447 Toronto area callers

- No pass code necessary

A replay of the conference call will be available until August 29, 2008 by dialing 1-800-408-3053 in Canada & USA (Toll-free) or 416-695-5800 in the Toronto area. The required pass code is 3268499.

A simultaneous webcast of the conference call will be posted on the home page of the company's website, www.edrsilver.com.

Endeavour Silver Corp. (TSX:EDR)(AMEX:EXK)(FRANKFURT:EJD) is a small-cap silver mining company focused on the growth of its silver production, reserves and resources in Mexico. The expansion programs now underway at Endeavour's two operating mines, Guanacevi in Durango and the Guanajuato Project in State, coupled with the Company's aggressive acquisition and exploration programs in Mexico should enable Endeavour to join the ranks of top primary silver producers worldwide.

ENDEAVOUR SILVER CORP.

Bradford Cooke, Chairman and CEO

CAUTIONARY DISCLAIMER - FORWARD LOOKING STATEMENTS

Certain statements contained herein regarding the Company and its operations constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, assumptions or expectations of future performance, are "forward-looking statements". We caution you that such "forward looking statements" involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Such risks and uncertainties include fluctuations in precious metal prices, unpredictable results of exploration activities, uncertainties inherent in the estimation of mineral reserves and resources, fluctuations in the costs of goods and services, problems associated with exploration and mining operations, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors, as discussed in the Company's filings with Canadian and American Securities regulatory agencies. Resource and production goals and forecasts may be based on data insufficient to support them. Godfrey Walton, P.Geo. and/or Bradford Cooke, P.Geo. are the Qualified Persons for the Company as required by NI 43-101. The Company expressly disclaims any obligation to update any forward-looking statements. We seek safe harbour.



ENDEAVOUR SILVER CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited -- Prepared by Management)
(expressed in thousands of US dollars,
except for shares and per share amounts)

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Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
Notes 2008 2007 2008 2007
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Sales 10,060 6,385 $ 20,789 $ 13,615

Cost of sales $ 6,361 $ 5,092 12,928 8,659
Depreciation,
depletion and
accretion 1,769 609 3,274 1,568
Exploration 2,661 1,331 4,744 3,101
General and
administrative 1,449 1,820 2,827 3,387
Stock-based
compensation 10 656 3,383 1,686 3,700
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Operating profit
(loss) (2,836) (5,850) (4,670) (6,800)

Foreign exchange
gain (loss) 165 1,459 (297) 1,651
Gain on
marketable
securities 231 280 974 280
Investment and
other income 74 251 217 545
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Income (loss)
before taxes and
other items (2,366) (3,860) (3,776) (4,324)
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Non-controlling
interest - - - (1,483)
Income tax
recovery
(provision) (1,051) 1,784 (1,652) 1,493
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Income (loss) for
the period (3,417) (2,076) (5,428) (4,314)
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Other
comprehensive
income, net of tax
Unrealized gain
(loss) on
marketable
securities 360 29 363 417
Reclassification
adjustment for gain
included in net income (558) (211) (974) (211)
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(198) (182) (611) 206
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Comprehensive
income (loss) for
the period (3,615) (2,258) (6,039) (4,108)
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Basic and diluted
loss per share
based on income
(loss) $ (0.07) $ (0.05) $ (0.11) $ (0.10)
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Weighted average
number of shares
outstanding 49,033,794 45,512,687 49,014,913 44,315,055

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Comparative Table of Consolidated Mine Operations
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Plant T'put Grade Recovered ounces Recoveries
----------- ----- ---------------- ----------
Period Tonnes Ag(gpt) Au(gpt) Ag(oz) Au(oz) Ag(%) Au(%)
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Production 2007 Year:

Q1, 2007 47,781 427 0.88 490,986 1,020 74.8 75.1
Q2, 2007 58,060 290 0.99 430,248 1,481 74.8 76.4
Q3, 2007 94,469 281 0.80 577,384 1,804 67.8 74.4
Q4, 2007 91,251 319 0.85 636,866 2,122 68.0 80.4
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2007 291,561 319 0.87 2,135,484 6,427 70.4 76.8
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Production 2008 Year:

Q1, 2008 78,157 304 0.71 504,669 1,433 66.2 79.8
Q2, 2008 86,391 257 0.77 517,077 1,705 72.8 83.0
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YTD 2008 164,548 279 0.74 1,021,746 3,138 69.7 81.5
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Q2, 2008 :
Q1, 2008 11% -15% 8% 2% 19% 10% 4%
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Q2, 2008 :
Q2, 2007 49% -11% -22% 20% 15% -3% 9%
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YTD 2008 :
YTD 2007 55% -21% -21% 11% 25% -7% 8%
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Comparative Table of Guanacevi Mine Operations
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Plant T'put Grade Recovered ounces Recoveries
----------- ----- ---------------- ----------
Period Tonnes Ag(gpt) Au(gpt) Ag(oz) Au(oz) Ag(%) Au(%)
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Production 2007 Year: 100% mine ownership April 1, 2008

Q1, 2007 47,781 427 0.88 490,986 1,020 74.8 75.1
Q2, 2007 40,749 377 0.72 382,377 824 75.9 76.4
Q3, 2007 68,084 342 0.61 491,643 987 65.8 74.5
Q4, 2007 69,681 370 0.65 542,789 1,126 65.4 76.9
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2007 226,295 375 0.70 1,907,795 3,957 69.4 75.7
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Production 2008 Year:

Q1, 2008 68,651 322 0.60 458,624 1,012 64.5 75.9
Q2, 2008 65,276 287 0.55 419,245 883 69.2 78.7
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YTD 2008 133,927 305 0.58 877,869 1,895 66.8 77.3
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Q2, 2008 :
Q1, 2008 -5% -11% -8% -9% -13% 7% 4%
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Q2, 2008 :
Q2, 2007 60% -24% -24% 10% 7% -9% 3%
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YTD 2008 :
YTD 2007 51% -25% -29% 1% 3% -11% 2%
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Comparative Table of Guanajuato Mine Operations
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Plant T'put Grade Recovered ounces Recoveries
----------- ----- ---------------- ----------
Period Tonnes Ag(gpt) Au(gpt) Ag(oz) Au(oz) Ag(%) Au(%)
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Production 2007 Year: Purchased May 2, 2007

Q1, 2007 0 0 0 0 0 0 0.0
Q2, 2007 17,311 120 1.70 47,870 657 71.7 69.4
Q3, 2007 26,385 124 1.29 85,742 817 81.5 74.7
Q4, 2007 21,570 155 1.50 94,077 886 87.7 85.0
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YTD 2007 65,266 133 1.47 227,689 2,360 81.5 76.6
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Production 2008 Year:

Q1, 2008 9,506 171 1.54 46,045 421 88.1 87.7
Q2, 2008 21,115 164 1.44 97,832 822 88.1 87.7
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YTD 2008 30,621 166 1.47 143,877 1,243 88.1 87.7
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Q2, 2008 :
Q1, 2008 122% -4% -6% 112% 95% 0% 0%
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Q2, 2008 :
Q2, 2007 22% 37% -15% 104% 25% 23% 26%
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YTD 2008 :
YTD 2007 77% 38% -13% 201% 89% 23% 26%
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ENDEAVOUR SILVER CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited -- Prepared by Management)
(expressed in thousands of US dollars)

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June 30, December 31,
Notes 2008 2007
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ASSETS

Current assets
Cash and cash equivalents $ 8,352 $ 16,577
Marketable securities 3 2,362 3,573
Accounts receivable and prepaids 4 10,578 7,200
Inventories 5 2,908 2,916
Due from related parties 116 228
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Total current assets 24,316 30,494

Long term deposits 882 877
Long term investments 7 3,932 3,932
Mineral property, plant and equipment 8 52,156 46,848
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Total assets $ 81,286 $ 82,151
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LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
Accounts payable and accrued liabilities $ 6,668 $ 4,348
Income taxes payable 896 781
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Total current liabilities 7,564 5,129

Asset retirement obligations 9 1,644 1,578
Future income tax liability 6,019 5,068

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Total liabilities 15,227 11,775
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Shareholders' equity
Common shares, unlimited shares authorized,
no par value, issued and outstanding
49,040,478 shares
(2007 - 48,982,146 shares) Page 5 87,545 87,458
Contributed surplus Page 5 10,556 8,921
Accumulated other comprehensive income Page 5 109 720
Deficit (32,151) (26,723)
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Total shareholders' equity 66,059 70,376
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$ 81,286 $ 82,151
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Subsequent events see note 10 (b)



ENDEAVOUR SILVER CORP.
CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited -- Prepared by Management)
(expressed in thousands of U.S. dollars)

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Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
Notes 2008 2007 2008 2007
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Operating activities
(Loss) for the period $ (3,417) $ (2,076) $ (5,428) $ (4,314)
Items not affecting
cash:
Stock-based
compensation 10 656 3,383 1,686 3,700
Depreciation, depletion
and accretion 1,769 609 3,274 1,568
Non-controlling
interest - - - 1,483
Future income tax loss
(recovery) 572 (1,869) 595 (2,276)
Unrealized foreign
exchange loss (gain) 203 54 351 25
Gain on marketable
securities (231) (280) (974) (280)
Net changes in non-cash
working capital 11 (1,735) (5,440) (1,051) (4,539)
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Cash from (used for)
operations (2,183) (5,619) (1,547) (4,633)
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Investing activites
Property, plant and
equipment expenditures 8 (4,391) (3,382) (8,288) (7,963)
Long term deposits (16) (844) (5) (844)
Investment in
marketable securities (1,271) (680) (2,240) (680)
Proceeds from sale of
marketable securities 1,348 1,211 3,819 1,211
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Cash used in investing
activities (4,330) (3,695) (6,714) (8,276)
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Financing activities
Common shares issued 10 4 2,277 36 5,169

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Cash from financing
activites 4 2,277 36 5,169
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Decrease in cash and
cash equivalents (6,509) (7,037) (8,225) (7,740)
Cash and cash
equivalents, beginning
of period 14,861 31,167 16,577 31,870
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Cash and cash
equivalents, end of
period $ 8,352 $ 24,130 $ 8,352 $ 24,130
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