Executive Summary / Key Takeaways

• Americas Gold and Silver (USAS) is undergoing a significant strategic transformation, shifting its focus towards becoming a prominent, high-grade silver producer by leveraging its revitalized Galena Complex and the ramping-up EC120 project.
• The company has substantially strengthened its financial position through a $50 million financing in late 2024 and a new US$100 million debt facility in June 2025, significantly reducing liabilities and providing capital for growth initiatives.
• Operational improvements and technological advancements, including a 100% increase in Galena's No. 3 Shaft skipping capacity and breakthroughs in antimony extraction, are enhancing productivity and unlocking new revenue streams.
• USAS is poised to capitalize on a bullish silver market, with expectations for incremental silver production increases throughout 2025 and beyond, aiming for over 80% of revenue from silver by year-end.
• Increased market visibility through inclusion in the Solactive Global Miners Silver Total Return Index and growing institutional ownership underscore the company's strategic progress and compelling valuation.

Americas Gold and Silver: A Strategic Transformation in the Metals Market

Americas Gold and Silver Corporation (USAS), originally incorporated in 1998, has strategically evolved from its roots to become a focused precious and base metals producer. The company's journey has been marked by pivotal acquisitions and a deliberate shift to leverage its silver assets, notably with the acquisition of the Galena Complex by the end of 2012. This historical foundation now underpins a significant transformation aimed at maximizing value in an anticipated bullish silver market.

The company operates within a competitive mining landscape, primarily focusing on silver, lead, zinc, copper, and gold in North America and Mexico. USAS positions itself as a mid-tier player, differentiating through targeted asset development and regional expertise. While larger rivals like Hecla Mining (HL), Pan American Silver (PAAS), and First Majestic Silver (AG) benefit from broader geographic footprints and established infrastructure, USAS's 100% ownership in key projects, such as the Cosalá Operations and Galena Complex, provides a direct competitive edge in decision-making and operational control. This allows for streamlined operations and potentially unique distribution channels through local partnerships. USAS aims to be among the lowest-cost silver producers globally, particularly with its San Rafael mine, and boasts significant silver resource leverage compared to many peers. The company's strategic agility in exploration and development allows it to pursue opportunities in less contested areas, though it must contend with the scale and diversified revenue streams of its larger competitors.

A core differentiator for Americas Gold and Silver lies in its continuous operational improvements and technological advancements. At the Galena Complex, the company has invested in new mining equipment, including larger 20-ton haul trucks, and implemented required ventilation upgrades to enhance productivity and safety. A significant milestone was the completion of Phase 1 upgrades to the No. 3 Shaft ahead of schedule in September 2025, which doubled skipping capacity from approximately 40 tons per hour (tph) to 80 tph, representing a 100% improvement. This upgrade is crucial for boosting overall mine productivity and cost efficiencies by the end of 2025. Furthermore, metallurgical test work at Galena in May 2025 demonstrated over 90% antimony recovery from ore, supporting the potential for near-term primary antimony production in the United States. This breakthrough, with 99%+ antimony extraction from copper concentrate, opens a new value driver for shareholders. These technological and operational enhancements are critical to USAS's competitive moat, contributing to lower operating costs, improved margins, and a stronger market position.

The broader industry context is favorable for precious metals. Management expresses optimism about a "very strong bull market for silver" with "a lot of room to run". Demand for metals is also being driven by trends such as electrification and the growth of AI and data centers, which require increased copper and silver. While the China-US trade war has historically introduced volatility to base metal prices, USAS remains bullish on the long-term fundamentals of zinc and lead. The company's strategy is to be prepared for an "explosive" move higher in silver prices.

Operational Excellence and Growth Drivers

Americas Gold and Silver's growth narrative is primarily driven by its two key operational segments: the Galena Complex in Idaho, USA, and the Cosalá Operations in Sinaloa, Mexico. The company is methodically building a foundation for multiyear production and growth, with a renewed focus on safely maximizing production from its existing asset base.

At the Galena Complex, the company has been laser-focused on unlocking its full potential since unifying ownership in late 2024. This includes significant progress on infrastructure projects to support the 55-179 decline, which will access higher-grade silver-lead and silver-copper veins in the Central and Lower Country Lead Zones. The company has ordered five new pieces of mining equipment to enhance safety and productivity, which are currently en route to operations. Exploration efforts have yielded promising results, including the discovery of the high-grade silver-copper 034 vein, with intercepts of 983 grams per tonne silver over 3.44 meters. This vein has an initial exploration target of 1.2 million to 1.5 million silver ounces and 750,000 to 800,000 pounds of copper and remains open at depth. The Core mine is another high-priority target for 2025, with historical intercepts of 4,313 g/t silver and 5% copper over 0.32 meters, and significant antimony potential. In Q1 2025, Galena produced 314,000 silver ounces, and in Q2 2025, production increased to 420,000 silver ounces, a 34% quarter-over-quarter improvement.

The Cosalá Operations in Mexico are undergoing a strategic transition from the San Rafael Main Central area to the higher-grade silver-copper ore in the EC120 project. In Q1 2025, Cosalá produced approximately 132,000 silver ounces, 6.7 million pounds of zinc, and 1.6 million pounds of lead. Q2 2025 saw a significant ramp-up, with the EC120 project contributing 211,000 ounces of silver, leading to a 103% improvement over Q1 2025 for Cosalá. Pre-production sales from EC120 contributed $2.3 million to revenue in Q1 2025 and $8.3 million in Q2 2025. The company anticipates ramping up to full production rates by mid-June/July, driving quarterly production increases as more EC120 ore is processed. Commercial production at EC120 is expected by the end of 2025, which is projected to significantly boost silver output and free cash flow.

Financial Performance and Strengthening the Balance Sheet

Americas Gold and Silver has demonstrated a concerted effort to improve its financial health and position itself for growth. In Q1 2025, revenue increased by 12% year-over-year to $23.5 million, driven by higher realized metal prices, with silver averaging just over $32 per ounce and zinc at $1.27 per pound. Consolidated silver production for the quarter was 446,000 ounces, an 80,000-ounce increase from the previous quarter. However, the company reported a net loss of $19 million for Q1 2025, primarily due to the impact of metal prices on metal-based liabilities and higher corporate general and administrative expenses. Adjusted EBITDA for Q1 2025 was a loss of $5.5 million.

For Q2 2025, consolidated silver production surged by 36% year-over-year and 54% quarter-over-quarter to 689,000 ounces. Despite higher realized silver prices of $34.22 per ounce, Q2 2025 revenue decreased to $27.0 million from $33.2 million in Q2 2024, attributed to lower production and realized prices of zinc and lead as the company transitions to the EC120 Project. Adjusted EBITDA for Q2 2025 was a loss of $4.1 million. Annually, 2024 revenue increased by 5% to $100.2 million from $95.2 million in 2023, with silver averaging $28.13 per ounce and zinc at $1.26 per pound. The net loss for 2024 was $48.9 million, and adjusted EBITDA was a loss of $1.5 million. The company's TTM financial ratios reflect the current development phase, with a Gross Profit Margin of -11.61% and a Net Profit Margin of -59.92%.

Americas Gold and Silver has made significant strides in strengthening its balance sheet and liquidity. In late 2024, a $50 million bought deal financing, coupled with the Galena consolidation, enabled a reduction in total liabilities by approximately $43 million. The full conversion of its convertible debenture into common shares further streamlined its capital structure. A $15 million secured financing with Trafigura in 2024 supported the EC120 project. Most recently, in June 2025, the company closed a transformational US$100 million senior secured debt facility with SAF Group, primarily earmarked for growth and development capital spending at the Galena Complex. This infusion, along with an $11.5 million non-brokered private placement, boosted cash and cash equivalents to $61.7 million as of June 30, 2025, a $52.9 million increase from Q1 2025. Working capital also improved significantly to $10.4 million from a deficit of $28.7 million at year-end 2024. A 5-year offtake agreement with Ocean Partners for Galena concentrates further solidifies future revenue streams.

Outlook and Strategic Initiatives

The outlook for Americas Gold and Silver is characterized by anticipated production growth, cost reductions, and enhanced market visibility. The company expects incremental silver production increases throughout 2025 and beyond as its growth plan is fully implemented. Commercial production at the EC120 project is targeted by the end of 2025, which is projected to significantly boost silver output and free cash flow. Management anticipates ongoing reductions in unit costs as silver production increases at both operations over the next several quarters. The strategic goal is to achieve over 80% of revenue from silver by the end of 2025, aligning the company with the anticipated bull market for the metal.

Corporate development initiatives are also strengthening the company's market position. Effective May 1, 2025, Americas Gold and Silver was included in the Solactive Global Miners Silver Total Return Index (SIL), leading to the acquisition of approximately 11.2 million shares by the ETF and significantly increasing visibility among large institutional investors. The company also sees strong potential for inclusion in the VanEck Junior Gold Miners ETF (GDXJ) later this year. Since the Galena Complex consolidation in December 2024, institutional ownership has grown from about 8% to over 60%, indicating strong investor confidence.

Risks and Challenges

Despite the positive outlook, Americas Gold and Silver faces inherent risks common in the mining industry. Metal price volatility remains a significant concern, directly impacting revenues, profitability, and the valuation of metal-based liabilities. Operational challenges, such as the 27-day shutdown at Galena in Q2 2018 due to a hoist brake shoe failure, can disrupt production and affect guidance. The company has also experienced increased zinc treatment and refining charges (TCRCs) in the past, driven by industry-wide factors and reduced global smelting capacity. Geopolitical factors, such as trade wars, can introduce further volatility to base metal prices. The capital-intensive nature of mining projects also presents a risk, requiring substantial funding for development and exploration.

While the company has secured significant financing, the successful execution of growth initiatives and the ability to generate sufficient cash flow remain critical.

Conclusion

Americas Gold and Silver is actively transforming into a focused, high-growth silver producer, strategically positioning itself to capitalize on a robust silver market. The company's revitalized Galena Complex, with its enhanced infrastructure and high-grade exploration potential, coupled with the ramping-up EC120 project at Cosalá, forms the bedrock of its production growth strategy. Technological advancements, such as the 100% increase in Galena's shaft capacity and the breakthrough in antimony extraction, underscore a commitment to operational efficiency and diversification.

With a significantly strengthened balance sheet, substantial debt financing, and increasing institutional investor interest, USAS is well-equipped to execute its ambitious plans. The company's clear guidance towards incremental silver production increases and a target of over 80% silver revenue by year-end 2025 highlights its strategic alignment. While commodity price volatility and operational risks persist, Americas Gold and Silver's focused approach, coupled with its competitive positioning and technological edge, presents a compelling investment thesis for those seeking exposure to a growing silver narrative.