Last updated on April 20, 2014 at 21:20 EDT

First Majestic Reports First Quarter Earnings of $26.5 million on Revenues of $67.1 million

May 15, 2013

Frankfurt – FMV

VANCOUVER, May 15, 2013 /PRNewswire/ – FIRST MAJESTIC SILVER CORP. (AG: NYSE; FR: TSX) (the “Company” or “First Majestic”) is pleased to
announce the unaudited condensed interim consolidated financial results
for the Company for the first quarter ending March 31, 2013. The full
version of the financial statements and the management discussion and
analysis can be viewed on the Company’s web site at www.firstmajestic.com or on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

2013 FIRST Quarter Highlights

        --  Silver ounces produced increased by 33% to 2,437,664 ounces
            compared to 1,826,803 ounces in Q1 2012
        --  Silver equivalent ounces produced increased by 36% to 2,731,792
            ounces compared to 2,007,219 ounces in Q1 2012
        --  Net Earnings after Taxes amounted to $26.5 million, a 1%
            increase from Q1 2012
        --  Earnings per Share (basic) amounted to $0.23, representing a 9%
            decrease from Q1 2012
        --  Cash Flow per share (non-GAAP) of $0.38, representing a 9%
            increase from Q1 2012
        --  Adjusted Earnings per Share (non-GAAP) amounted to $0.21 after
            excluding non-cash and non-recurring items
        --  Revenues increased 16% to $67.1 million, compared to Q1 2012
        --  Mine Operating Earnings amounted to $34.6 million, a decrease
            of 3% from Q1 2012
        --  Total Production Cost per Tonne was $31.79, an increase of 9%
            from Q1 2012
        --  Total Cash Cost, net of by-product credits, was $9.49 per
            ounce, up 6% compared to Q1 2012
        --  Average revenue per ounce was $29.63 a decrease of 10% from
            $32.79 compared to Q1 of 2012
        --  Substantial budget cuts have been made for 2013 including a 49%
            reduction in exploration to $12.5 million and a 21% reduction
            in mine development to $68.2 million equaling a total reduction
            to capital expenditures of 16% to $162.3 million
        --  At the end of the quarter, Cash and Cash Equivalents stood at
            $110.1 million and Working Capital of $108.3 million


                                 First Quarter     First Quarter
                                     2013              2012          Change


    Silver Equivalent Ounces
    Produced                        2,731,792         2,007,219        36%

    Silver Ounces Produced
    (excluding equivalent
    ounces from by-products)        2,437,664         1,826,803        33%

    Payable Silver Ounces
    Produced(1)                     2,224,819         1,766,160        26%

    Total Cash Costs per
    Ounce(2)                           $9.49             $8.96          6%

    Total Production Cost
    per Tonne(2)                      $31.79            $29.24          9%

    Average Realized Silver
    Price Per Ounce ($/eq.
    oz.)(2)                           $29.63            $32.79        -10%


    Revenues ($ millions)              $67.1             $57.8         16%

    Mine Operating Earnings
    ($ millions)                       $34.6             $35.7         -3%

    Net Earnings ($
    millions)                          $26.5             $26.4          1%

    Operating Cash Flows
    Before Movements in
    Working Capital and
    Income Taxes ($
    millions)                          $44.9             $37.1         21%

    Cash and Cash
    Equivalents ($ millions)          $110.1             $85.3         29%

    Working Capital ($
    millions)                         $108.3            $108.3          0%


    Earnings Per Share
    ("EPS") - Basic                    $0.23             $0.25         -9%

    Cash Flow Per Share(2)             $0.38             $0.35          9%

    Weighted Average Shares
    Outstanding for the
    Periods                       116,895,218       105,440,048        11%

    (1)     Payable Silver Ounces Produced is equivalent to Silver Ounces
            Produced less metal deductions from smelters and refineries.

    (2)     The Company reports non-GAAP measures which include Total Cash
            Costs per Ounce, Total Production Cost per Tonne, Average
            Realized Silver Price per Ounce and Cash Flow Per Share. These
            measures are widely used in the mining industry as a benchmark
            for performance, but do not have a standardized meaning and may
            differ from methods used by other companies with similar

Keith Neumeyer, President and CEO of First Majestic states, “Despite the
recent fall in silver prices we remain committed to aggressively
growing our business while at the same time monitoring our investments
and our production costs. This year marks a pivotal year for First
Majestic with four major expansion projects underway simultaneously.
These expansions remain on track and will set the stage for major
growth in the coming years. However, we need to be sensitive to the
current market conditions and be smart about our use of capital. We are
committed as usual to focus on cost reductions and capital optimization
without affecting our aggressive growth plans.”


        --  Generated revenues of $67.1 million for the first quarter of
            2013, a decrease of 6% compared to the fourth quarter of 2012,
            primarily due to 9% decrease in average realized silver price
            per ounce.  Revenues increased 16% compared to the first
            quarter of 2012, primarily due to 36% increase in production,
            partially offset by 10% decrease in average realized silver
            price per ounce.

        --  Generated net earnings of $26.5 million for the first quarter
            of 2013 (EPS of $0.23), an increase of 19% compared to $22.4
            million (EPS of $0.19) in the fourth quarter of 2012, and an
            increase of 1% compared to $26.4 million (EPS of $0.25) in the
            first quarter of 2012.

        --  Adjusted EPS (a non-GAAP measure) for the first quarter of 2013
            was $0.21, after excluding non-cash and non-recurring items
            which include the realized one-time net gain of $9.1 million as
            a result of the termination fee from the Orko Silver Corp.
            arrangement agreement.

        --  Cash costs increased 2% from $9.26 in the prior quarter to
            $9.49 in the first quarter of 2013, primarily due to a 2%
            increase in the Mexican peso relative to the US dollar on
            average quarter over quarter. Compared to the first quarter of
            2012, cash cost per ounce was 6% higher primarily due to the
            addition of the La Guitarra mine, and a 3% appreciation of the
            Mexican peso against the US dollar.

        --  Recognized mine operating earnings of $34.6 million compared to
            $39.5 million in the fourth quarter of 2012, a decrease of 12%
            due to lower gross margin resulting from a 9% decrease in
            silver prices, a 2% increase in cash costs, and higher
            depreciation, depletion and amortization expense related to the
            increased size of plant, equipment and mineral properties.
            Mine operating earnings for the quarter decreased 3% compared
            to the first quarter of 2012, as the 36% increase in production
            was offset by a 10% decrease in silver prices, 3% appreciation
            of the Mexican peso, and higher depreciation, depletion and
            amortization expense.

        --  Cash flows from operations before movements in working capital
            and income taxes in the first quarter of 2013 increased by 4%
            to $44.9 million ($0.38 per share) compared to $43.2 million
            ($0.37 per share) in the fourth quarter of 2012, and increased
            by 21% compared to $37.1 million ($0.35 per share) in the first
            quarter of 2012.

        --  In March 2013, the Company received approval from the Toronto
            Stock Exchange to repurchase up to 5,848,847 common shares of
            the Company over the next 12 months through normal course
            issuer bid in the open market.  Since April 1, 2013, the
            Company has repurchased 115,000 shares for a total
            consideration of CAD$1.4 million, of which 75,000 shares have
            been cancelled.

        --  In December 2012, First Majestic entered into an arrangement
            agreement with Orko Silver Corp. ("Orko") to acquire all of the
            issued and outstanding shares of Orko.  In February 2013, Orko
            declared that another company made a superior offer and First
            Majestic elected not to match the superior offer.  Upon
            termination of the arrangement agreement, the Company received
            an $11.4 million termination fee from Orko in February 2013.
            Net of professional fees, legal and investment banking costs,
            the Company recognized a gain of $9.1 million in other income.


As reported in February 2013, the Company planned to invest a total of
$192.3 million in capital growth projects in 2013, of which $86.2
million was earmarked for mine development and $24.5 million towards
exploration. Following the recent decline in silver prices, the Company
has re-evaluated its company-wide discretionary capital investments for
the first half of 2013 and has made several cuts. If silver prices do
not improve prior to the third quarter, further cuts in capital
commitments will be made. These current cuts do not affect production
guidance for 2013.

The Company has earmarked the following capital expenditure reductions
for the first half of 2013:

        --  Global exploration reduced by $12.0 million to $12.5 million,
            representing a 49% reduction
        --  Global mine development reduced by $18.0 million to $68.2
            million, representing a 21% reduction
        --  Total budgeted capital growth requirements including priority
            construction and expansionary activities at various mines are
            now $162.3 million, representing a 16% reduction

The revised $162.3 million budget consists of $81.6 million for plant
expansions for Del Toro, San Martin, La Guitarra and the underground
rail system of La Parrilla and $80.7 million of discretionary
exploration and development for all of the Company’s properties.  Of
the $81.6 million budget for plant expansions, $19.6 million has
already been expended and, for the $80.7 million exploration and
development budget, $23.7 million has also already been expended as at
March 31, 2013.  Therefore, remaining planned expenditures is $119.0
million, which includes $62.0 million for committed plant expansion and
$57.0 million for discretionary exploration and development for the
remainder of the 2013 budget year.

Furthermore, each of the Company’s on-going expansion projects at the
Del Toro, La Parrilla, San Martin and La Guitarra Silver mines remain
unaffected as a result of these reductions with the La Guitarra mine
already ramped up to 500 tpd in the second quarter and the Del Toro and
San Martin mines scheduled to ramp up in the third quarter.  Therefore,
global silver production guidance remains on track to achieve 11.1 to
11.7 million silver ounces or 12.3 to 13.0 million ounces of silver
equivalent in 2013.  The Company remains well financed with $110.1
million in cash and cash equivalents on hand at the end of the first
quarter, allowing all priority construction and expansionary activities
to continue on schedule towards achieving the Company’s estimated 2013
annual production growth rate of 40%.

During the first quarter, the Company completed a full implementation of
SAP ERP financial and operational reporting software throughout and
integrating all 24 of the Company’s head office and various
subsidiaries.  This investment is expected to provide enhanced and
in-depth real-time analytical tools for operational performance and
efficient analyses, monitoring of its operations’ cost accounting and
various key performance indicators on a company by company basis and on
a consolidated basis.


First Majestic experienced another solid quarter of earnings and cash
flow due in part to record production of 2,731,792 silver equivalent
ounces, an increase of 36% compared to 2,007,219 silver equivalent
ounces produced in the first quarter of 2012. Silver production hit record levels during the first quarter with
2,437,664 ounces of silver being produced, representing an increase of
33% compared to 1,826,803 ounces of silver produced in the first
quarter of 2012.  Cash cost per ounce in the first quarter increased
$0.23 or 2% from $9.26 in the fourth quarter of 2012, primarily due to
the 2% appreciation of the Mexican peso against the US dollar.

Total ore processed in the quarter reached 730,357 tonnes, an increase
of 31% compared to the first quarter of 2012.  The increase in milled
ore is a direct result of the successful plant expansion at La Parrilla
and the additional ore processed at the recently acquired La Guitarra
Silver Mine.

The overall average head grade for the first quarter of 2013 was 181
grams per tonne (“g/t”), a 2% increase compared to 177 g/t in the first
quarter of 2012 and 3% increase compared to 176 g/t in the fourth
quarter of 2012.  The increase from the previous quarter was primarily
attributed to 15% higher head grades from La Encantada, due to increase
in head grades from fresh ore, offset by 11% lower head grades from La
Parrilla due to an increase in oxides production from the lower grade
open pit. Combined recoveries for all mines in the first quarter were
57% and consistent compared to 57% in the first quarter of 2012 and 58%
in the fourth quarter of 2012.

At the Del Toro Silver Mine, the Phase one construction for the 1,000
tpd flotation plant was completed and inaugurated in a special ceremony
on January 23, 2013.  Phase two construction, which will include the
addition of a 1,000 tpd cyanidation circuit, is now in progress.  Phase
two start-up is expected by July 1, 2013, at which time, the mill is
expected to start ramping up to a combined throughput rate of 2,000 tpd
(1,000 tpd flotation and 1,000 tpd cyanidation).  The cyanidation
circuit construction is progressing well with tanks, foundations for
SAG mills and platforms for the Merrill-Crowe having been completed,
and tailings filter #1 was fully installed and operational.  As of
March 31, 2013, 30 shipments totalling 933 dry tonnes of concentrates
had been shipped. During the quarter, silver-lead concentrates have
contained an average of 34% of lead, 4,875 g/t of silver and 1.3 g/t of
gold. Further ongoing daily improvements are underway with a focus on
daily tonnage, recoveries, quality of concentrate production and other
plant optimizations.  During the month of April, 12 additional
shipments had been shipped containing 371 dry tonnes of concentrates.
Production of Zinc concentrates began in May and eight shipments have
been delivered containing 225 dry tonnes of concentrates.  The Company
remains on schedule for the third and final phase of production
(2,000 tpd flotation and 2,000 tpd cyanidation) by the third quarter of
2014, at which time Del Toro is expected to become the Company’s
largest producing operation, producing approximately six million ounces
of silver per year, with significant amounts of lead and zinc.

At the La Guitarra Silver Mine, the expansion of the processing plant
from 350 tpd to 500 tpd was completed in April 2013. This new circuit
consisted of the installation of a new ball mill, new flotation cells
and related infrastructure.  The expansion is expected to increase La
Guitarra’s output to approximately 1.2 million ounces of silver
equivalent annually, representing over one million ounces of pure
silver plus a modest amount of gold. Permitting for a 1,000 tpd
cyanidation processing facility is expected to be completed in the next
few months with an anticipated commencement of construction in the
second half of 2013.  At 1,000 tpd throughput from cyanidation,
production is anticipated to reach over two million ounces of silver
doré production per year when completed.

The Company’s third expansion project at the San Martin Silver Mine is
progressing according to plan. The current 950 tpd mill and processing
plant consists of crushing, grinding and conventional cyanidation by
agitation in tanks and Merrill-Crowe doré production system.  The plant
operates between 850 to 900 tpd, and a plant expansion is currently
underway that will see the production rate increase to a planned
throughput of 1,300 tpd. The expansion project is expected to be
completed on time and on budget in the third quarter of 2013.  The
Company is planning to release a new NI 43-101 Technical Report very
shortly which will include updated Reserves and Resources from the
Rosarios/Huichola areas as well as an economic assessment on the
current expansion.

First Majestic is a producing silver company focused on silver
production in México and is aggressively pursuing its business plan of
becoming a senior silver producer through the development of its
existing mineral property assets and the pursuit through acquisition of
additional mineral assets which contribute to the Company achieving its
aggressive corporate growth objectives.



Keith Neumeyer, President & CEO


This news release includes certain “Forward-Looking Statements” within
the meaning of the United States Private Securities Litigation Reform
Act of 1995 and applicable Canadian securities laws. When used in this
news release, the words “anticipate”, “believe”, “estimate”, “expect”,
“target”, “plan”, “forecast”, “may”, “schedule” and similar words or
expressions, identify forward-looking statements or information. These
forward-looking statements or information relate to, among other
things: the price of silver and other metals; the accuracy of mineral
reserve and resource estimates and estimates of future production and
costs of production at our properties; estimated production rates for
silver and other payable metals produced by us, the estimated cost of
development of our development projects; the effects of laws,
regulations and government policies on our operations, including,
without limitation, the laws in Mexico which currently have significant
restrictions related to mining; obtaining or maintaining necessary
permits, licences and approvals from government authorities; and
continued access to necessary infrastructure, including, without
limitation, access to power, land, water and roads to carry on
activities as planned.

These statements reflect the Company’s current views with respect to
future events and are necessarily based upon a number of assumptions
and estimates that, while considered reasonable by the Company, are
inherently subject to significant business, economic, competitive,
political and social uncertainties and contingencies. Many factors,
both known and unknown, could cause actual results, performance or
achievements to be materially different from the results, performance
or achievements that are or may be expressed or implied by such
forward-looking statements or information and the Company has made
assumptions and estimates based on or related to many of these factors.
Such factors include, without limitation: fluctuations in the spot and
forward price of silver, gold, base metals or certain other commodities
(such as natural gas, fuel oil and electricity); fluctuations in the
currency markets (such as the Canadian dollar and Mexican peso versus
the U.S. dollar); changes in national and local government,
legislation, taxation, controls, regulations and political or economic
developments in Canada, Mexico; operating or technical difficulties in
connection with mining or development activities; risks and hazards
associated with the business of mineral exploration, development and
mining (including environmental hazards, industrial accidents, unusual
or unexpected formations, pressures, cave-ins and flooding); risks
relating to the credit worthiness or financial condition of suppliers,
refiners and other parties with whom the Company does business;
inability to obtain adequate insurance to cover risks and hazards; and
the presence of laws and regulations that may impose restrictions on
mining, including those currently enacted in Mexico; employee
relations; relationships with and claims by local communities and
indigenous populations; availability and increasing costs associated
with mining inputs and labour; the speculative nature of mineral
exploration and development, including the risks of obtaining necessary
licenses, permits and approvals from government authorities;
diminishing quantities or grades of mineral reserves as properties are
mined; the Company’s title to properties; and the factors identified
under the caption “Risk Factors” in the Company’s Annual Information
Form, under the caption “Risks Relating to First Majestic’s Business”.

Investors are cautioned against attributing undue certainty to
forward-looking statements or information. Although the Company has
attempted to identify important factors that could cause actual results
to differ materially, there may be other factors that cause results not
to be anticipated, estimated or intended. The Company does not intend,
and does not assume any obligation, to update these forward-looking
statements or information to reflect changes in assumptions or changes
in circumstances or any other events affecting such statements or
information, other than as required by applicable law.

SOURCE First Majestic Silver Corp.

Source: PR Newswire