Americas Gold and Silver Corporation Reports First Quarter 2021 Results and Provides Operational Update

TORONTO, ONTARIO – May 17, 2021 – Americas Gold and Silver Corporation (TSX: USA) (NYSE American: USAS) (“Americas” or the “Company”), a growing North American precious metals producer, reports consolidated financial and operational results for the quarter ended March 31, 2021 along with the progress to reopen the Cosalá Operations, continued exploration success at the Galena Complex and an update for Relief Canyon.

This earnings release should be read in conjunction with the Company’s Management’s Discussion and Analysis, Financial Statements and Notes to Financial Statements for the corresponding period, which have been posted on the Americas Gold and Silver Corporation SEDAR profile at www.sedar.com, and on its EDGAR profile at www.sec.gov, and which are also available on the Company’s website at www.americas-gold.com.  All figures are in U.S. dollars unless otherwise noted.

Highlights

• Revenue of $10.2 million and a net loss of $91.8 million for Q1-2021 or a loss of ($0.72) per share, which includes an impairment charge of $55.6 million and an inventory write-down of $23.0 million related to Relief Canyon.  Adjusted net loss[1] was $13.2 million prior to these one-time adjustments or ($0.10) per share.
• Following an extensive review and a challenging ramp-up at Relief Canyon, the operation is proceeding with run-of-mine heap leaching.  The Company expects this change will improve overall project economics going forward.
• The Company is confident that a resolution will be reached to reopen the Cosalá Operations with all employees returning to work in the near term with a ramp-up to full production in Q3-2021.  Full Mexican government support will ensure the long-term stability of the operation.
• At the Galena Complex, geologists have located and drilled the downdip extension of the prolific Silver Vein.  All of the first 8 holes hit high-grade mineralization highlighted by the following:
  • Hole 55-175A:  7,370 g/t silver and 6.3% copper (8,020 g/t silver equivalent [[2]]) over 2.7 m [[3]] including:  30,200 g/t silver and 26.1% copper (32,900 g/t silver equivalent) over 0.3 m
    including:  23,000 g/t silver and 17.0% copper (24,800 g/t silver equivalent) over 0.2 m
    including:  11,500 g/t silver and 10.0% copper (12,500 g/t silver equivalent) over 0.2 m
  • Hole 55-148:  5,320 g/t silver and 4.1% copper (5,730 g/t silver equivalent) over 0.8 m
    including:  10,200 g/t silver and 7.9% copper (11,000 g/t silver equivalent) over 0.4 m
  • Hole 55-176:  3,110 g/t silver and 2.4% copper (3,350 g/t silver equivalent) over 1.8 m
    including:  23,900 g/t silver and 17.5% copper (25,700 g/t silver equivalent) over 0.2 m
    and:  1690 g/t silver and 1.1% copper (1,810 g/t silver equivalent) over 0.4 m

“Based on our latest discussions with both the state and federal Mexican government, we are on the cusp of a resolution to the illegal blockade at our Cosalá Operations and anticipate our employees will be back to work this quarter,” stated Americas Gold and Silver President & CEO Darren Blasutti.  “The restart of the Cosalá Operations and the recent high-grade Silver Vein discovery at the Galena Complex, near existing infrastructure, will increase exposure to silver and cash flow to the Company and our shareholders.  At Relief Canyon, following months of study, we have decided to transition to run-of-mine heap leaching to simplify the flowsheet and improve performance.  While the ramp-up has been more difficult than the Company envisioned, I believe this change will lead to better economics and enhanced profitability for the operation.”

Relief Canyon

The ramp-up at Relief Canyon has been a challenge and continues to be challenging as documented since the Company first poured gold in February 2020.  During this period, the Company and its consultants have performed extensive analyses and implemented a number of procedural changes to address the start-up challenges.  As part of this analysis, the Company identified naturally occurring carbonaceous material within the Relief Canyon pit.  The identification of this material was not recognized in the feasibility study.

During the first phase of mining (Phase 1 of 5), several adverse impacts affected the operation including the onset of the COVID-19 pandemic and the failure of the Company’s radial stacker.  Offsetting these challenges was that the definition of the gold mineralized zones through blasthole sampling reconciled reasonably to the block model.  However, during Phase 1, an unknown quantity of carbonaceous material was crushed, stacked and disseminated onto the leach pad resulting in lower-than-expected recovery of the placed gold ore.  Following realization of this adverse material, the Company implemented additional measures to the ore control procedure to minimize the impact the carbonaceous material could have on leach pad performance.  Additional efforts focussed on improving mining selectivity including the use of a hydraulic excavator operating on split (10 foot) benches when required.

Phase 2 mining, which commenced in late Q4-2020/early Q1-2021, has demonstrated a more structurally complex area than initially interpreted, caused by additional faults and folds.  Gold mineralization is strongly influenced by structural controls.  The impact of the structural complexity, combined with the increased mining selectivity to reject carbonaceous material, has decreased ore availability in Q1-2021 and into Q2-2021.

As a result of these challenges, the Company began two small run-of-mine test pads in Q1-2021 to evaluate the possibility of simplifying the flowsheet by by-passing the crushing and conveying circuits.  Results have been encouraging and the operation has transitioned to this method of ore placement to further demonstrate its applicability with haul trucks now delivering the ore directly from the pit to the leach pad.  The Company continues to evaluate options to improve the short-term operational and financial performance of the asset.

Additional improvements in the predictability of the resource model are progressing with incorporation of the latest geological detail from recent pit mapping as well as new data from an extensive re-assaying program of over 10,000 historic exploration pulp samples.  Completion of this data compilation and analysis is targeted for late Q3-2021 as part of the Company’s mid-year update of its reserve and resource estimates.

As a result of the differences observed between the modelled (planned) and mined (actual) ore tonnage and the carbonaceous material identified in the early phases of the mine plan, an impairment charge of $55.6 million has been taken in Q1-2021, reducing the carrying value of the Relief Canyon mineral interest, and property, plant and equipment.  An additional reduction of $23.0 million was taken to inventory as a result of the decreased recovery expected from crushed gold ounces already placed on the leach pad.  As further test work is ongoing, future results may cause a reassessment of the remaining carrying value and cause a subsequent recovery or an increase to the impairment.

Cosalá Operations

The illegal blockade at the Cosalá Operations, which has been in place since February 2020, is nearing a resolution and the Company is confident that the operations will restart this quarter.  The expected resolution follows tireless efforts by the Company’s representatives in Mexico in cooperation with various members of as the Mexican federal government, who have sought to properly characterize the nature of the conflict with decision makers (including President Manuel Lopez Obrador) and to establish a framework that will allow for the safe return of the Company’s employees and allow for continuous operation in the long term.  The Company understands that a recent positive development in the conflict is the engagement for the first time of state government with its federal counterparts to support a resolution that benefits the people of Cosalá with the peaceful removal of the illegal blockade.   Assuming the delivery of agreed conditions and the enforcement of applicable law, the Company eagerly anticipates getting the operation restarted and is targeting full mining operations in Q3-2021.

Upon resolution of the illegal blockade and a re-start of operations, higher silver prices will allow the Company to target the higher-grade silver ores in the Upper Zone of San Rafael and develop the silver-copper EC120 project.  Mining these silver-rich areas of the Cosalá Operations is expected to significantly increase silver production to over 2.5 million ounces of silver per annum in the years following the removal of the blockade.

Galena Complex

Initial drilling from the new drill station on the 5500 Level has yielded several high-grade intercepts at depth.  Galena geologists discovered a new silver-copper trend south of the prolific Silver Vein.  The strike and dip of this new trend matches very well with the strike and dip of the majority of the Silver Vein mined from the 3200 Level to the 4300 Level.  Initial interpretations are that this trend is either a southern splay of the Silver Vein or that it is the true Silver Vein at depth.

Initial intercepts from the 5500-level drilling includes:

• Hole 55-175A:  7,370 g/t silver and 6.3% copper (8,020 g/t silver equivalent) over 2.7 m
  including:  30,200 g/t silver and 26.1% copper (32,900 g/t silver equivalent) over 0.3 m
  including:  23,000 g/t silver and 17.0% copper (24,800 g/t silver equivalent) over 0.2 m
  including:  11,500 g/t silver and 10.0% copper (12,500 g/t silver equivalent) over 0.2 m
• Hole 55-148:  5,320 g/t silver and 4.1% copper (5,730 g/t silver equivalent) over 0.8 m
  including:  10,200 g/t silver and 7.9% copper (11,000 g/t silver equivalent) over 0.4 m
• Hole 55-178:  4,290 g/t silver and 3.1% copper (4,610 g/t silver equivalent) over 0.9 m
• Hole 55-146:  3,430 g/t silver and 3.1% copper (3,740 g/t silver equivalent) over 1.1 m
  including:  21,800 g/t silver and 18.9% copper (23,700 g/t silver equivalent) over 0.1 m
  and:  844 g/t silver and 7.9% lead (1,180 g/t silver equivalent) over 2.0 m
• Hole 55-147:  3,290 g/t silver and 3.7% copper (3,680 g/t silver equivalent) over 2.5 m
  including:  5,250 g/t silver and 5.7% copper (5,840 g/t silver equivalent) over 1.2 m
  and:  1,110 g/t silver and 6.8% lead (1,430 g/t silver equivalent) over 1.6 m
• Hole 55-174:  1,750 g/t silver and 2.0% copper (1,960 g/t silver equivalent) over 2.2 m
  including:  2,770 g/t silver and 2.5% copper (3,040 g/t silver equivalent) over 0.7 m
• Hole 55-176:  3,110 g/t silver and 2.4% copper (3,350 g/t silver equivalent) over 1.8 m
  including:  23,900 g/t silver and 17.5% copper (25,700 g/t silver equivalent) over 0.2 m
  and:  1,690 g/t silver and 1.1% copper (1,810 g/t silver equivalent) over 0.4 m
  and:  758 g/t silver and 0.6% copper (820 g/t silver equivalent) over 1.7 m
• Hole 55-144:  749 g/t silver and 0.7% copper (818 g/t silver equivalent) over 0.9 m

Figure 1: Long Section (Looking North) depicting some significant intercepts from 5500 Level drilling

East Coeur drilling, which commenced in January 2021, targeting the area between Galena’s historically prolific West Argentine mining front and the Coeur mine continues to provide solid results.  Key results from the East Coeur drilling includes:

• Hole 34-122:  1,170 g/t silver and 1.3% copper (1,310 g/t silver equivalent) over 1.8 m
• Hole 34-125:  1,900 g/t silver and 2.4% copper (2,150 g/t silver equivalent) over 0.4 m
• Hole 34-124:  2,590 g/t silver and 2.7% copper (2,870 g/t silver equivalent) over 0.2 m
• Hole 34-132:  2,360 g/t silver and 3.6% copper (2,730 g/t silver equivalent) over 0.2 m

Geologists drilled an additional hole further east of the current East Coeur drilling which intercepted a new, un-named vein.  Additional drilling is planed to further test this area but initial results are encouraging.

• Hole 34-133:  713 g/t silver and 2.0% copper (914 g/t silver equivalent) over 1.4 m

A full table of drill results can be found at:

https://americas-gold.com/site/assets/files/4297/dr20210516.pdf

The Company expects 2021 to be a transitional year at the Galena Complex for future production with continued exploration drilling supporting production growth toward a 2 million silver ounce per year plan.  Longer term and assuming continued exploration success, with the results from the 5500 Level and East Coeur drilling providing a solid initial indication, the Company is confident that the operation will again reach peak historical annual production levels of approximately 5 million ounces per year.

The Company is targeting further mineral resource additions at the Galena Complex from the remainder of Phase 1 drilling through June 2021 with the potential increase exceeding the originally targeted addition of 50 million ounces of silver.

At-The-Market Offering

Americas has entered into an at-the-market offering agreement dated May 17, 2021 (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (the “Lead Agent”) and ROTH Capital Partners, LLC as agents, pursuant to which the Company established an at-the-market equity program (the “ATM Program”).  Pursuant to the ATM Program and ATM Agreement, the Company may, at its discretion and from time-to-time during the term of the ATM Agreement, sell, through the Lead Agent, such number of common shares of the Company (“Common Shares”) as would result in aggregate gross proceeds to the Company of up to US$50.0 million.  Sales of Common Shares, if any, through the Lead Agent, acting as agent, will be made through “at the market” issuances, including without limitation, sales made directly on the NYSE American LLC or other existing trading market for the shares in the United States at the market price prevailing at the time of each sale, and, as a result, sale prices may vary.  No Common Shares will be offered or sold on the Toronto Stock Exchange or any other trading markets in Canada.  The ATM Program will be effective until March 1, 2023 unless terminated prior to such date.  Americas intends to use the net proceeds from the ATM Program, if any, primarily to support the growth and development of the Company’s existing mine operations as well as working capital and general corporate purposes.

The ATM Program will be made by way of a prospectus supplement dated May 17, 2021 (the “Prospectus Supplement”) to the Company’s existing Canadian short form base shelf prospectus dated January 29, 2021 (the “Base Shelf Prospectus”) and U.S. registration statement on Form F-10, as amended (File No. 333-240504) (the “Registration Statement”), dated January 29, 2021.  The Registration Statement was declared effective by the United States Securities and Exchange Commission (the “SEC”) on February 1, 2021.  The Prospectus Supplement has been filed with the applicable provincial regulatory authorities in Canada and the SEC.  The Canadian Prospectus Supplement (together with the related Canadian Base Shelf Prospectus) is available on the SEDAR website maintained by the Canadian Securities Administrators at www.sedar.com.  The U.S. Prospectus Supplement (together with the related U.S. Base Shelf Prospectus) is available on the SEC’s EDGAR website at www.sec.gov.

This news release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these Common Shares in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

About Americas Gold and Silver Corporation

Americas Gold and Silver Corporation is a high-growth precious metals mining company with multiple assets in North America.  The Company owns and operates the Relief Canyon mine in Nevada, USA, the Cosalá Operations in Sinaloa, Mexico and manages the 60%-owned Galena Complex in Idaho, USA.  The Company also owns the San Felipe development project in Sonora, Mexico.  For further information, please see SEDAR or www.americas-gold.com.