Q1 a watershed quarter for Discovery Silver with Timmins acquisition

Discovery Silver Corp. has announced financial results for the three months (“Q1 2025”) ended March 31, 2025. All figures are stated in Canadian dollars unless otherwise noted.

 “Q1 2025 was a breakout quarter for Discovery. On January 27, 2025, we announced the transformational acquisition of the Porcupine Complex (“Porcupine Operations” or “Porcupine”) in and near Timmins, Ontario," said Tony Makuch, Discovery’s CEO, 

"Through this acquisition, we have established our company as a new Canadian gold producer with substantial potential for growth in one of the world’s most prolific gold camps. The acquisition provides Discovery with valuable diversification by combining growing gold production in Canada with our Cordero project (“Cordero” or the “Project”) in Mexico, one of the industry’s leading silver development projects.

“The market reaction to the acquisition has been resoundingly positive, with Discovery’s share price tripling during the first quarter and achieving a 250% increase on a year-to-date basis as of May 12, 2025. With the transaction closing on April 15, 2025, our focus now has turned to implementing investment plans to realize the tremendous upside we see at Porcupine, including the substantial exploration potential that exists at all sites and regionally over the 1,400 km2 land position.

“Since the closing, there have already been significant developments. On April 24, 2025, we had our first gold pour, and to date have sold 2,800 ounces of gold for gross proceeds of approximately $13.0 million. We just completed a two-week mill shutdown, that had been previously scheduled for the purpose of replacing equipment in the thickening tanks. We used the occasion to advance plans to enhance mill performance, with multiple additional projects completed, primarily in the crushing, grinding and carbon handling circuits. The mill is now running, we have stockpiles built up and we are resuming gold production and sales.

“With a current pro forma cash position of approximately $250 million, and an undrawn US$100 million senior debt facility, we are well capitalized to move forward with our investment strategy for Porcupine, and to fund our current expenditure plans for 2025 at Cordero. The pro forma cash position reflects the addition US$475 million of cash through recently completed royalty and equity financings, net of US$200 million cash consideration paid for Porcupine at closing, transaction and other related costs and cash collateral required for closure obligation bonding requirements.”

PORCUPINE OPERATIONS
The Porcupine Operations of Discovery cover approximately 1,400 km2 in and near Timmins, Ontario, with the Timmins Camp being one of the world’s most prolific gold mining camps. Production from the Porcupine Operations commenced in 1910 and, since that time, Porcupine has accounted for close to 70 million ounces of gold production.

Porcupine consists of the Hoyle Pond, Pamour and Hollinger mine properties, the Dome mine property and milling facility (collectively “Dome”), and numerous near-mine and regional exploration targets in and around Timmins, Ontario. The Complex also includes the Borden mining operation and large, highly prolific, land position near Chapleau, Ontario. All mineralization from the operating mines is treated at Dome, including mineralization from Borden, which is trucked 190 km to the Dome Mill.

Based on the recent technical report (the “Technical Report”), annual production at Porcupine is expected to average over 285,000 ounces of gold for the next 10 years, with total production extending to 2046. Discovery expects to improve on the estimates in the Technical Report through investment in the assets to grow production, extend mine life and lower costs at existing operations. The Company also plans extensive exploration drilling, with there being multiple attractive drill targets at each asset and significant regional exploration potential.

Key highlights of the Porcupine operations and their upside potential are provided below.

• Hoyle Pond: One of Canada’s highest grade gold mines that has produced over four million ounces of gold since 1987 and, over that period, has established an excellent track record for replacing reserves. Opportunities for improvement include enhancing ventilation, material handling and backfill systems, increasing automation, including expanding the use of tele-remote delivery systems, and drilling extensively to extend and expand existing zones, as well as to evaluate known areas of mineralization that are not currently included in mineral resource estimates.
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• Borden: A relatively new mine at the centre of a 1,000 km2 land position with significant potential to extend existing mining zones and where there has been limited exploration outside of the current mining area. Discovery plans to improve performance at Borden by upgrading the haulage fleet, including increasing the use of electric vehicles, improving ground support and backfill systems and increasing ventilation levels.
• Pamour: A new open-pit operation with a 22-year mine life that could become significantly larger through exploration success. In addition to exploration upside, opportunities to increase the value of the project include reducing or eliminating waste-rock rehandling and investigating the use of alternative delivery systems to replace truck haulage from the open pit to the Dome Mill.
• Dome Mine: One of the pillars of Canada’s gold mining history, where there remains a large mineral resource and substantial exploration upside. An important priority in 2025, will be assessing the nearly 11.0 million ounces of Inferred Mineral Resource in the Technical Report, as well as other mineralization outside the current pit shell, in order to assess the potential for resuming mining production at Dome.
• Dome Mill: A large-scale central processing facility currently operating below capacity levels. Based on the Technical Report, the mill is expected to process approximately 2.0 million tonnes in 2025, with Discovery targeting an increase to 4.3 – 4.4 million tonnes by 2028 or sooner.

SELECTED FINANCIAL DATA:
The following selected financial data is taken from the Company’s consolidated financial statements and related notes thereto (the “Financial Statements”) for the three months ended March 31, 2025, and the Management’s Discussion and Analysis (“MD&A”) for the quarter. The Company’s Financial Statements and MD&A are available at www.discoverysilver.com and on SEDAR+ at www.sedarplus.ca.

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