NYSE American:SVM $2.74 0.00 TSX:SVM $3.48 0.00

News & Media

2014

Silvercorp Reports Financial and Operating Results for the Fourth Quarter and Fiscal Year Ended March 31, 2014 and Provides Outlook for Fiscal 2015

May 22, 2014

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 22, 2014) - Silvercorp Metals Inc. ("Silvercorp" or the "Company") (TSX:SVM)(NYSE:SVM) today reported its financial and operating results for the fourth quarter and fiscal year ended March 31, 2014 ("Fiscal 2014") and announced its outlook for the fiscal year ending March 31, 2015 ("Fiscal 2015").

FOURTH QUARTER HIGHLIGHTS

--  Silver production of 0.6 million ounces and gold production of 2,349
    ounces;
--  Lead production of 5.2 million pounds and zinc production of 0.9 million
    pounds;
--  Sales of $16.1 million;
--  Gross margin of 43%;
--  Cash flow from operations of $3.1 million, or $0.02 per share;
--  Adjusted net income of $1.1 million or $0.01 per share; and
--  Cash cost per ounce of silver, net of by-product credits, of $2.82.

FISCAL YEAR 2014 HIGHLIGHTS

--  Silver production of 3.9 million ounces and gold production of 11,124
    ounces;
--  Lead production of 37.2 million pounds and zinc production of 8.4
    million pounds;
--  Sales of $108.4 million;
--  Gross margin of 45%;
--  Cash flow from operations of $36.1 million, or $0.21 per share;
--  Adjusted net income of $7.6 million or $0.04 per share; and
--  Cash cost per ounce of silver, net of by-product credits, of $2.16.

FINANCIALS

1. Q4 Fiscal 2014 vs. Q4 Fiscal 2013

For the quarter ended March 31, 2014 ("Q4 Fiscal 2014"), net loss attributable to equity holders of the Company was $4.5 million or $0.03 per share compared to net income of $6.4 million or $0.04 per share in the quarter ended March 31, 2013 ("Q4 Fiscal 2013"). Net loss in the current quarter includes a $3.3 million loss on the disposal of mineral rights and properties and a non-cash impairment charge of $2.3 million in relations to the Company's investment in an associate. Excluding these items, adjusted net income for Q4 Fiscal 2014 was $1.1 million or $0.01 per share. There were no adjusting items in Q4 Fiscal 2013.

Compared to the same prior year quarter, the decrease in net income was mainly due to (i) lower metal production as silver, lead, zinc production was 38%, 47%, and 54% lower compared to Q4 Fiscal 2013 and (ii) a 31% decrease in the realized price for silver, from $23.49 in Q4 Fiscal 2013 to $16.13 in Q4 Fiscal 2014.

In Q4 Fiscal 2014, the Company realized sales of $16.1 million, down 51% compared to $33.1 million in Q4 Fiscal 2013.

Cost of sales in Q4 Fiscal 2014 was $9.2 million compared to $16.1 million in Q4 Fiscal 2013 and included cash costs of $7.8 million compared to $13.5 million in Q4 Fiscal 2013. The 43% decrease in cost of sales was due primarily to a 36% decrease in mine production.

The gross profit margin in Q4 Fiscal 2014 was 43%, compared to 52% in Q4 Fiscal 2013.

Cash flow from operations in Q4 Fiscal 2014 was $3.1 million or $0.02 per share, compared to $13.6 million, or $0.08 per share, in Q4 Fiscal 2013.

2. Fiscal 2014 vs. Fiscal 2013

For the year ended March 31, 2014, net loss attributable to equity holders of the Company was $41.0 million, or $0.24 per share compared to net income of $27.2 million, or $0.16 per share in Fiscal 2013. Net loss in the current fiscal year includes non-cash impairment charges of $42.8 million, or $0.25 per share, net of tax, which reduced the carrying value of the BYP mine, as well as the XBG and Silvertip projects, both of which were sold during the fiscal year. Also, the Company recognized a non-cash impairment charge of $2.3 million in relations to its investment in an associate and a loss of $3.5 million primarily on the disposal of the XBG project.

Adjusted net income for Fiscal 2014 was $7.6 million, or $0.04 per share compared to $36.9 million, or $0.22 per share in Fiscal 2013. Adjusted net income or loss excludes non-recurring or unusual non-operational items, such as impairment of the Company's mineral properties and investments in associate, and acts as a supplemental financial measure that provides a more complete assessment of the Company's operations for the year.

In the current fiscal year, the Company's financial results were mainly impacted by the following: (i) lower metal production as silver, lead and zinc production decreased 22%, 31%, and 32%, compared to the prior fiscal year and (ii) a significantly lower net realized silver price of $16.74 per ounce in this fiscal year, which is $6.97 or 29% lower compared to $23.71 per ounce in the prior fiscal year.

In Fiscal 2014, the Company realized sales of $108.4 million compared to $181.6 million in Fiscal 2013.

Cost of sales in Fiscal 2014 was $60.0 million compared to $73.1 million in Fiscal 2013 and included cash costs of $47.9 million compared to $59.9 million in Fiscal 2013. The decrease in cost of sales is mainly due to a 21% decrease in ore production in the current year.

In Fiscal 2014, the gross profit margin was 45% compared to 60% in Fiscal 2013.

Cash flow from operations in Fiscal 2014 was $36.1 million or $0.21 per share, compared to $85.2 million, or $0.50 per share, in Fiscal 2013. The Company ended the fiscal year with $73.5 million in cash, cash equivalents and short-term investments.

OPERATIONS

The consolidated operational results for the past five quarters and full Fiscal 2014 and Fiscal 2013 are summarized in the table below:

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Consolidated
 Operational
 Results                           Quarterly                     Annual
                   ---------------------------------------- ----------------
                                                              Fiscal  Fiscal
                    Q4 2014 Q3 2014 Q2 2014 Q1 2014 Q4 2013     2014    2013
                    31-Mar- 31-Dec- 30-Sep- 30-Jun- 31-Mar-  31-Mar- 31-Mar-
                         14      13      13      13      13       14      13
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Ore Mined (tonne)
  Direct Smelting
   Ore (tonne)          393     715     503     963   1,309    2,574   8,336
  Stockpiled Ore
   (tonne)          110,455 168,825 170,253 261,369 171,348  710,902 896,912
                   ---------------------------------------------------------
                    110,848 169,540 170,756 262,332 172,657  713,476 905,248
----------------------------------------------------------------------------
Run of Mine Ore
 (tonne)
  Direct Smelting
   Ore (tonne)          393     715     503     963   1,309    2,574   8,336
  Ore Milled
   (tonne)          109,554 172,110 176,863 272,114 198,356  730,641 943,929
                   ---------------------------------------------------------
                    109,947 172,825 177,366 273,077 199,665  733,215 952,265
----------------------------------------------------------------------------
Metal Sales
  Silver (in
   thousands of
   ounces)              582     885   1,021   1,374     944    3,862   4,973
  Gold (in
   thousands of
   ounces)              2.3     2.0     3.0     3.8     2.3     11.1    12.5
  Lead (in
   thousands of
   pounds)            5,165   9,000   9,519  13,468   9,827   37,152  53,898
  Zinc (in
   thousands of
   pounds)              883   1,672   2,199   3,692   1,903    8,446  12,377
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Head Grade of Run
 of Mine Ore
  Silver
   (gram/tonne)         216     202     217     200     205      207     220
  Gold (gram/tonne)
   - BYP mine           3.5     2.7     2.8     2.8     3.0      3.4     3.1
  Lead (%)              2.7     2.9     2.9     2.7     2.9      2.8    3.29
  Zinc (%)              0.6     0.7     1.0     0.8     0.7      0.8    1.01
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Recovery Rate of
 Run of Mine Ore
  Silver (%)           92.9    93.1    92.7    92.3    93.5     92.7    92.8
  Gold (%) - BYP
   mine                93.7    92.7    93.0    92.5    92.0     92.8    92.4
  Lead (%)             95.3    95.7    94.8    94.6    94.5     95.0    94.5
  Zinc (%)             62.4    64.2    68.5    68.4    60.3     66.9    66.8
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Cash Mining Cost ($
 per tonne)           44.02   47.20   43.46   51.19   57.71    47.33   52.05
Total Mining
 Costs($ per tonne)   55.74   59.95   56.56   63.55   70.96    59.25   65.85
Cash Milling Cost
 ($ per tonne)        14.96   15.74   14.98   12.17   15.50    14.13   13.56
Total Milling Cost
 ($ per tonne)        19.28   18.22   17.28   13.67   17.86    16.49   15.36
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Cash Cost per Ounce
 of Silver ($)         2.82    2.00    0.49    3.23    3.65     2.16    0.48
Total Production
 Cost per Ounce of
 Silver ($)            5.86    4.39    3.41    5.33    5.82     4.68    2.45
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BYP Cash Cost per
 Ounce of Gold ($)      531     502     486     448     493      488     455
BYP Production Cost
 per Ounce of Gold
 ($)                    736     959     853     914     870      798     882
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1. Q4 Fiscal 2014 vs. Q4 Fiscal 2013

In Q4 Fiscal 2014, on a consolidated basis, the Company produced 0.6 million ounces of silver, 2,349 ounces of gold, 5.2 million pounds of lead, and 0.9 million pounds of zinc compared to 0.9 million ounces of silver, 2,333 ounces of gold, 9.8 million pounds of lead, and 1.9 million pounds of zinc in Q4 Fiscal 2013.

Ying Mining DistrictHenan ProvinceChina

In Q4 Fiscal 2014, the Company mined 90,057 tonnes of ore at the Ying Mining District compared to 153,323 tonnes in Q4 Fiscal 2013. During the quarter, metal production totalled 0.6 million ounces of silver, 461 ounces of gold, 5.2 million pounds of lead and 0.9 million pounds of zinc, compared to 0.9 million ounces of silver, 800 ounces of gold, 9.5 million pounds of lead, and 1.6 million pounds of zinc in Q4 Fiscal 2013. The lower mine production was related to operational difficulties experienced in January and February, which were disclosed in the Company's press release of February 13, 2014. In addition, heavy snow storms in central China in early February 2014, which delayed the miners at the Ying Mining District returning to work after Chinese New Year holiday for about two weeks, also impacted the mine production.

Head grades were 216 grams per tonne ("g/t") for silver, 2.7% for lead and 0.6% for zinc, compared to 205 g/t for silver, 2.9% for lead and 0.7% for zinc in the same quarter last year, benefiting from enhanced dilution control monitoring and improved operations in March 2014.

In Q4 Fiscal 2014, total and cash mining costs per tonne were $60.85 and $49.04, respectively, compared to $72.56 and $61.67 in Q4 Fiscal 2013, respectively. The decrease of cash mining costs was due to cost control measures enacted in recent quarters, including (i) using less in-stope infill diamond drilling and (ii) using more low cost shrinkage mining method compared to the higher cost re-suing mining method in the same prior year period.

In Q4 Fiscal 2014, a total of 91,272 tonnes of ore was milled compared to 158,145 tonnes in Q4 Fiscal 2013. The cash milling cost per tonne was $15.08 in Q4 Fiscal 2014 compared to $16.05 in Q4 Fiscal 2013.

Total and cash costs per ounce of silver in Q4 Fiscal 2014 for the Ying Mining District were $5.86 and $2.82 respectively, compared to $5.82 and $3.65, in Q4 Fiscal 2013, respectively.

BYP MineHunan ProvinceChina

In Q4 Fiscal 2014, the Company mined 20,791 tonnes of ore at the BYP mine with a gold head grade of 3.5 g/t compared to 19,334 tonnes with a gold head grade of 3.0 g/t in Q4 Fiscal 2013. During the quarter, 1,888 ounces of gold were produced and sold at a cash cost per ounce of gold of $531 compared to 1,509 ounces of gold were produced and sold at a cash cost per ounce of gold of $493 in the same period last year. In Q4 Fiscal 2014, total and cash mining costs per tonne were $33.62 and $22.29, respectively, compared to $58.33 and $26.35 in Q4 Fiscal 2013, respectively.

2. Fiscal 2014 vs. Fiscal 2013

In Fiscal 2014, on a consolidated basis, the Company produced 3.9 million ounces of silver, 11,124 ounces of gold, 37.2 million pounds of lead and 8.4 million pounds of zinc, compared to 5.0 million ounces of silver, 12,457 ounces of gold, 53.9 million pounds of lead and 12.4 million pounds of zinc in Fiscal 2013.

Ying Mining DistrictHenan ProvinceChina

In Fiscal 2014, the total ore mined at the Ying Mining District was 625,266 tonnes compared to 776,846 tonnes in Fiscal 2013.

Head grades at the Ying Mining District were 207 g/t for silver, 2.8% for lead, 0.8% for zinc in Fiscal 2014 compared to 220 g/t for silver, 3.3% for lead, and 1.0% for zinc in Fiscal 2013.

In Fiscal 2014, the Ying Mining District produced 3.9 million ounces of silver, 3,527 ounces of gold, 36.6 million pounds of lead, and 7.6 million pounds of zinc compared to 4.9 million ounces of silver, 4,153 ounces of gold, 52.2 million pounds of lead, and 11.2 million pounds of zinc in Fiscal 2013.

In Fiscal 2014, total and cash mining costs per tonne were $61.33 and $50.73, respectively, compared to $66.62 and $55.94, respectively, in Fiscal 2013. The overall decrease in cash mining costs per tonne was due to less in-stope infill drilling and more low cost shrinkage mining method used.

In Fiscal 2014, total ore milled was 634,493 tonnes, a decrease of 18% compared to 774,534 tonnes in Fiscal 2013. Cash milling costs were $14.14 compared to $13.56 in Fiscal 2013. The increase is mainly due to the allocation of the fixed costs to a reduced tonnage of ore milled, compared to the prior year.

Including by-product credits, in Fiscal 2014, total cost and cash cost per ounce of silver were $4.68 and $2.16, respectively, compared to $2.45 and $0.48, respectively, in Fiscal 2013. The main reason for the higher cash cost per ounce of silver was the decline in the relative value of by-product credits per tonne of ore mined.

As previously discussed in our news release on September 12, 2013, the Company reviewed its operations at the Ying Mining District and found that dilutive practice of mining contractors was contributing to the head grade decline. As a result of this finding, one contractor was dismissed and the Company took remedial action by modifying the method of calculating the amount of ore mined for compensating the miners. The change in compensation method caused uncertainty to the contractors and resulted in miner shortages which significantly impacted production during the year as the Company took decisive action to curb the dilutive mining practices. In addition, the change in mining strategy in the prior year favoring more shrinkage mining stopes, yielded mixed results as dilution control was found to be inadequate in certain mines and negatively impacted head grades. These efforts have made the second half of Fiscal 2014 the most challenging operating period in the Company's history, however, benefits are now being recognised in terms of improved head grades, lower production costs, reduced employee counts, and overhead reduction over the last two and a half months.

BYP MineHunan ProvinceChina

In Fiscal 2014, the total ore mined was 88,210 tonnes compared to 109,093 tonnes in Fiscal 2013. The Company produced and sold 7,416 ounces of gold in Fiscal 2014 compared to 8,068 ounces of gold in Fiscal 2013. The cash cost per ounce of gold was $488 in Fiscal 2014 compared to $455 in Fiscal 2013. Gold head grade for Fiscal 2014 was 3.4 g/t compared to 3.1 g/t in Fiscal 2013.

DEVELOPMENT AND EXPLORATION

1. Ying Mining DistrictHenan ProvinceChina

During the year, the Company completed approximately 63,000 metres ("m") of horizontal tunnels, raises and declines.

At the end of Fiscal 2014, the ramp at SGX mine reached its optimized depth of 260m elevation. The connection from the ramp to the 350m, 300m and 260m elevations were also completed. In addition, the ramp at LM Mine West reached 710m elevation. This ramp will be developed to 650m elevation and will be used for mining between 650m and 800m elevations.

To preserve cash during the current lower commodity price environment, the Company suspended the construction of office buildings and dormitories at SGX, HPG and LM West mines, and a transformer substation at LM West to better allocate resources during the current market.

Total exploration and development expenditures for the Ying Mining District were $30.4 million compared to $33.3 million in Fiscal 2013.

2. GC MineGuangdong ProvinceChina

The required surface environmental protection facilities together with water and soil conservation engineering work have been completed and have undergone test operations. During the year, all the work required for the issuance of the final Safety Production Permit has been completed with the final inspection expected at the end of June 2014. The Company has received a temporary Safety Production Permit in the meantime which allows for trial mining and stope preparation work. The Company will continue to conduct trial mining, mill processing and additional stope preparation work until the final Safety Production Permit is received.

As the Company has completed the mine development phase and ramps up its trial mine production, and as part of the Company's focus on cost control and efficiency, the Company has replaced the previous mining contractor with a new one in March 2014 at lower unit costs for mining and development. A new mine management team was also put in place at the time. Since then, mining at the GC mine has commenced and production rates have gradually increased.

Through the test milling of stope ore from mine production, the mill has been improved to enhance the recovery for silver, lead and zinc to the level of metallurgic studies, but the recovery rate for tin is still not satisfactory and action is being taken to address this issue.

The tailing dewatering facility for dry stacking has also been improved with modifications to equipment achieving desired results. The construction of the tailing dry stacking dam and reservoir facility has been completed and has passed government inspection.

During Fiscal 2014, approximately 12,500m of tunnels, including 2,000m of development tunnels, 6,500m of exploration tunnels and 4,000m of mining preparation tunnels, were completed.

In Fiscal 2014, $15.9 million (Fiscal 2013 - $15.8 million) of exploration and development expenditures were incurred at the GC mine.

3. BYP MineHunan ProvinceChina

In Fiscal 2014, the construction of the head frame was mostly completed, with the installation of the hoist system still in progress. Once complete, the newly completed 265m shaft will facilitate mining of the #3 gold mineralization body, and depending on commodity prices, the #5 zinc and lead ore body. In addition, the construction of a 1,500 t/d tailings-backfill facility is complete and operational. Exploration and development expenditures at the BYP mine were $1.5 million in the current fiscal year compared to $5.7 million in the prior year.

OUTLOOK

Production Guidance - Fiscal 2015 Silver Production to Increase by 22% to 4.7 million ounces in comparison to Fiscal 2014 actual production

In Fiscal 2014, the Company enacted a series of improvements covering all aspects of operations, including mine planning and strategy, contractor compensation contracts, dilution control, and a performance-based (linked to tonnage and grade) compensation package for mine management. Following the end of the Chinese New Year holiday in February, benefits of the improvements began to be recognised. Production in March and April were generally in line with management's production expectations for Fiscal 2015.

In Fiscal 2015, the Company expects to continue to operate in a lower commodity price environment, but expects to benefit from the operational adjustments implemented during Fiscal 2014. The Company expects to produce approximately 1 million tonnes of ore, yielding 4.7 million ounces of silver, 11,700 ounces of gold, and 76.7 million pounds of lead and zinc, in Fiscal 2015.

----------------------------------------------------------------------------
                                Ying
                              Mining                                   Grand
PROJECT                     District   GC Mine  BYP Mine  XHP Mine     Total
----------------------------------------------------------------------------
Ore processed (tonnes)       650,000   245,000   120,000    37,000 1,052,000
----------------------------------------------------------------------------
                                 Head Grades
----------------------------------------------------------------------------
Silver (gram per tonne)          215       127         -        30
Gold (gram per tonne)           0.20         -      2.60         -
Lead (%)                         3.5       1.3         -       3.0
Zinc (%)                         0.9       2.7         -       3.0
----------------------------------------------------------------------------
                              Metal Production
----------------------------------------------------------------------------
Silver ('000 ounces)           4,080       600         -        21     4,701
Gold ('000 ounces)               2.8         -       8.9         -      11.7
Lead (million pounds)           46.3       5.9         -       2.0      54.2
Zinc (million pounds)            8.2      12.6         -       1.7      22.5
----------------------------------------------------------------------------

At the Ying Mining District, production is expected to be 650,000 tonnes of ore with grades of 215 g/t silver, 0.2 g/t gold, 3.5% lead and 0.9% zinc, with expected metal production of 4.1 million ounces of silver, 2,800 ounces of gold, and 54.5 million pounds of lead and zinc. The cash and total production costs are expected to be approximately $66 and $82 per tonne of ore, respectively. Silver production from the Ying Mining District will be 6% higher compared with Fiscal 2014 production.

The GC mine, in Guangdong Province, commenced trial mining in March 2014. Production is expected to gradually ramp up to 800 tonnes per day in the second quarter of Fiscal 2015. In Fiscal 2015, the Company expects to produce 245,000 tonnes of ore with grades of 127 g/t silver, 1.3% lead and 2.7% zinc, with expected metal production of 0.6 million ounces of silver, and 18.5 million pounds of lead and zinc. The cash and total production costs are expected to be approximately $45 and $70 per tonne of ore, respectively.

The BYP mine in Hunan Province is expected to produce 120,000 tonnes of ore, yielding approximately 8,900 ounces of gold. The cash and production costs are expected to be approximately $35 and $55 per tonne of ore, respectively.

Capital Expenditure Budget



----------------------------------------------------------------------------
              Ying Mining
PROJECT         District     GC Mine     BYP Mine    XHP Mine   Grand Total
             ---------------------------------------------------------------
             Quantit      Quantit      Quanti      Quanti      Quantit
                   y  Cost      y  Cost    ty  Cost    ty  Cost      y  Cost
                 (m) ($mm)    (m) ($mm)   (m) ($mm)   (m) ($mm)    (m) ($mm)
----------------------------------------------------------------------------
Mine   Shafts
 Develo and
 pment  Ramps  4,000   5.0      -   1.5    50   0.1     -     -  4,050   6.6

       Horizo
        ntal
        Tunne
        ls,
        Raise
        s &
        Decli
        nes   33,100  13.9  9,150   4.4 2,350   1.0   300   0.1 44,900  19.4
       ---------------------------------------------------------------------
         Sub
        total 37,100  18.9  9,150   5.9 2,400   1.1   300   0.1 48,950  26.0
----------------------------------------------------------------------------
       Surfac
Explora e
 tion   drill
        ing    6,300   0.5      -     - 7,500   0.4     -     - 13,800   0.9

       Underg
        round
        drill
        ing   39,600   1.4 19,700   0.8 2,100   0.1   800   0.1 62,200   2.4
       ---------------------------------------------------------------------
         Sub
        total 45,900   1.9 19,700   0.8 9,600   0.5   800   0.1 76,000   3.3
----------------------------------------------------------------------------
Land-usage
 rights,
 buildings
 and
 equipment             3.7          2.4         0.1         0.2          6.4
----------------------------------------------------------------------------
GC prior
 year's
 construction
 balance                 -          3.9           -           -          3.9
----------------------------------------------------------------------------
Total Capital
 Expenditure
 Budget               24.5         13.0         1.7         0.4         39.6
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Total capital expenditures for Fiscal 2015 are estimated to be $39.6 million. Capital investment is budgeted at $16.9 million, including mine development of shafts and ramps of $6.6 million, land, buildings and equipment of $6.4 million; and $3.9 million in payments for the GC mine's construction completed last year. Sustaining capital totaling $19.4 million includes development of tunnels, raises and declines. The budget estimate is based on contracts in hand, designs by qualified engineering firms, and the Company's prior experiences.

At the Ying Mining District, the capital expenditure budget is $24.5 million and includes $5.0 million to complete the construction of two ramps at LM and SGX and several vertical shafts at Ying, to provide access to the respective mines at depth. Also, $13.9 million is budgeted for the construction of 33,100m of horizontal tunnels, declines and raises for mining, development and $1.9 million is budgeted for a 45,900m surface and underground drilling program. The surface facilities budget of $3.7 million includes the completion of the construction of dormitory and office buildings.

At the GC mine, the capital expenditures for Fiscal 2015 are expected to be $13.0 million, which include $3.9 million for payments related to construction completed in the prior years, $1.5 million for shaft installation, $4.4 million for the development of 9,150m of horizontal tunnels and raises, $0.8 million for exploration to support a 19,700m surface and underground drilling program, and $2.4 million for obtaining land use rights, building construction and equipment procurement.

In addition, the Company budgets $1.7 million and $0.4 million in capital expenditures for BYP mine and XHP mine, respectively.

CHANGES IN SENIOR MANAGEMENT

Mr. Shaoyang Shen, who has been based in China for the last seven years, has resigned from his position as Chief Operations Officer, in order to spend more time with his family in Canada. The Company has accepted Mr. Shen's resignation, thanks him for his contributions, and wishes him continued success. Mr. Shen's responsibilities will be allocated between the General Managers of each of the respective mines.

Myles Gao, P.Geo., President & CEO, is the Qualified Person for Silvercorp under NI 43-101 and has reviewed and given consent to the technical information contained in this News Release.

This earnings release should be read in conjunction with the Company's Management Discussion & Analysis, Financial Statements and Notes to Financial Statements for the corresponding period, which have been posted on SEDAR at www.sedar.com and are also available on the Company's website at www.silvercorp.ca. All figures are in United States dollars unless otherwise stated.

About Silvercorp

Silvercorp is a low-cost silver-producing Canadian mining company with multiple mines in China. The Company is currently developing the GC project in southern China which it expects will become its next operating mine. The Company's vision is to deliver shareholder value by focusing on the acquisition of under developed projects with resource potential and the ability to grow organically. For more information, please visit our website at www.silvercorp.ca.

CAUTIONARY DISCLAIMER - FORWARD LOOKING STATEMENTS

Certain of the statements and information in this press release constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "is expected", "anticipates", "believes", "plans", "projects", "estimates", "assumes", "intends", "strategies", "targets", "goals", "forecasts", "objectives", "budgets", "schedules", "potential" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information. Forward-looking statements or information relate to, among other things: the price of silver and other metals; the accuracy of mineral resource and mineral reserve estimates at the Company's material properties; the sufficiency of the Company's capital to finance the Company's operations; estimates of the Company's revenues and capital expenditures; estimated production from the Company's mines in the Ying Mining District; timing of receipt of permits and regulatory approvals; availability of funds from production to finance the Company's operations; and access to and availability of funding for future construction, use of proceeds from any financing and development of the Company's properties.

Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks relating to: fluctuating commodity prices; calculation of resources, reserves and mineralization and precious and base metal recovery; interpretations and assumptions of mineral resource and mineral reserve estimates; exploration and development programs; feasibility and engineering reports; permits and licences; title to properties; property interests; joint venture partners; acquisition of commercially mineable mineral rights; financing; recent market events and conditions; economic factors affecting the Company; timing, estimated amount, capital and operating expenditures and economic returns of future production; integration of future acquisitions into the Company's existing operations; competition; operations and political conditions; regulatory environment in China and Canada; environmental risks; foreign exchange rate fluctuations; insurance; risks and hazards of mining operations; key personnel; conflicts of interest; dependence on management; internal control over financial reporting as per the requirements of the Sarbanes-Oxley Act; and bringing actions and enforcing judgments under U.S. securities laws.

This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements or information. Forward-looking statements or information are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements or information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company's Annual Information Form for the year ended March 31, 2013 under the heading "Risk Factors". 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 as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information.

The Company's forward-looking statements and information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this press release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements and information if circumstances or management's assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information. For the reasons set forth above, investors should not place undue reliance on forward-looking statements and information.

SILVERCORP METALS INC.
Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)

                                             March 31, 2014   March 31, 2013
----------------------------------------------------------------------------
ASSETS
Current Assets
  Cash and cash equivalents                        $ 60,614         $ 72,283
  Short-term investments                             12,864           45,623
  Trade and other receivables                         4,004            1,442
  Inventories                                         5,362            7,522
  Due from related parties                               68              123
  Prepaids and deposits                               6,165            5,118
----------------------------------------------------------------------------
                                                     89,077          132,111

Non-current Assets
  Long-term prepaids and deposits                     4,000            1,877
  Investment in an associate                          3,715            6,523
  Other investments                                   2,393           15,516
  Plant and equipment                               101,876          103,517
  Mineral rights and properties                     266,258          316,678
----------------------------------------------------------------------------
TOTAL ASSETS                                      $ 467,319        $ 576,222
----------------------------------------------------------------------------

LIABILITIES AND EQUITY
Current Liabilities
  Accounts payable and accrued liabilities         $ 23,802         $ 29,285
  Deposits received                                   7,031           11,497
  Dividends payable                                     773            4,204
  Income tax payable                                    515            1,349
  Due to related parties                                281            1,207
----------------------------------------------------------------------------
                                                     32,402           47,542

Non-current Liabilities
  Deferred income tax liabilities                    16,536           24,603
  Environmental rehabilitation                        5,819            5,974
----------------------------------------------------------------------------
Total Liabilities                                    54,757           78,119
----------------------------------------------------------------------------

Equity
  Share capital                                     233,513          233,082
  Share option reserve                               10,492            8,314
  Reserves                                           25,409           24,717
  Accumulated other comprehensive loss             (20,141)          (1,495)
  Retained earnings                                 100,993          155,817
----------------------------------------------------------------------------
Total equity attributable to the equity
 holders of the Company                             350,266          420,435

Non-controlling interests                            62,296           77,668
----------------------------------------------------------------------------
Total Equity                                        412,562          498,103
----------------------------------------------------------------------------

TOTAL LIABILITIES AND EQUITY                      $ 467,319        $ 576,222
----------------------------------------------------------------------------


SILVERCORP METALS INC.
Consolidated Statements of Income
(Expressed in thousands of U.S. dollars, except for per share figures)

                           Three Months Ended March
                                                31,    Years Ended March 31,
                           ------------------------ ------------------------
                                   2014        2013         2014        2013
----------------------------------------------------------------------------
                            (Unaudited) (Unaudited)
Sales                          $ 16,135    $ 33,147    $ 108,400   $ 181,622
Cost of sales                     9,190      16,060       59,996      73,089
----------------------------------------------------------------------------
Gross profit                      6,945      17,087       48,404     108,533

General and administrative        3,531       6,252       24,424      25,734
General exploration and
 property investigation             285         711        2,751       3,909
Other taxes                         322         483        1,897       2,985
Foreign exchange gain             (421)     (1,050)      (3,171)     (1,382)
Loss on disposal of plant
 and equipment                       10          64          154         149
Loss (gain) on disposal of
 mineral rights and
 properties                       4,295       (644)        4,476       (644)
Share of loss (gain) in
 associate                         (66)        (34)           87         197
Impairment on associate           2,304           -        2,304       9,640
Impairment of mineral
 rights and properties                -           -       66,573           -
Loss (gain) on investments         (19)         980          589       1,651
Other income                       (20)       (153)        (137)       (535)
----------------------------------------------------------------------------
Income (loss) from
 operations                     (3,276)      10,478     (51,543)      66,829

Finance income                      232       1,666        3,185       4,507
Finance costs                      (33)        (23)        (132)        (92)
----------------------------------------------------------------------------
Income (loss) before income
 taxes                          (3,077)      12,121     (48,490)      71,244

Income tax expense
 (recovery)                       1,600       3,730        (134)      29,201
----------------------------------------------------------------------------
Net income (loss)             $ (4,677)     $ 8,391   $ (48,356)    $ 42,043
----------------------------------------------------------------------------

Attributable to:
  Equity holders of the
   Company                    $ (4,541)     $ 6,361   $ (41,017)    $ 27,211
  Non-controlling interests       (136)       2,030      (7,339)      14,832
----------------------------------------------------------------------------
                              $ (4,677)     $ 8,391   $ (48,356)    $ 42,043
----------------------------------------------------------------------------

Earnings (loss) per share
 attributable to the equity
 holders of the Company
Basic earnings (loss) per
 share                         $ (0.03)      $ 0.04     $ (0.24)      $ 0.16
----------------------------------------------------------------------------
Diluted earnings (loss) per
 share                         $ (0.03)      $ 0.04     $ (0.24)      $ 0.16
----------------------------------------------------------------------------
Weighted Average Number of
 Shares Outstanding - Basic 170,881,836 170,772,725  170,830,620 170,733,504
----------------------------------------------------------------------------
Weighted Average Number of
 Shares Outstanding -
 Diluted                    170,881,836 170,990,015  170,830,620 171,059,482
----------------------------------------------------------------------------


SILVERCORP METALS INC.
Consolidated Statements of Cash Flow
(Expressed in thousands of U.S. dollars)

                           Three Months Ended March
                                                31,    Years Ended March 31,
                           ------------------------ ------------------------
                                   2014        2013         2014        2013
----------------------------------------------------------------------------
Cash provided by            (Unaudited) (Unaudited)
Operating activities
  Net (loss) income           $ (4,677)     $ 8,391   $ (48,356)    $ 42,043
  Add (deduct) items not
   affecting cash:
    Unwinding of discount
     of environmental
     rehabilitation                  33          23          132          92
    Depreciation,
     amortization and
     depletion                    2,118       2,935       13,536      14,588
    Share of loss (gain) in
     associate                     (66)        (34)           87         197
    Impairment on associate       2,304           -        2,304       9,640
    Impairment of mineral
     rights and properties            -           -       66,573           -
    Write down of
     inventories                      -           -            -         348
    Income tax expense
     (recovery)                   1,600       3,730        (134)      29,201
    Loss (gain) on
     investments                   (19)         980          589       1,651
    Loss on disposal of
     plant and equipment             10          64          154         149
    Loss (gain) on disposal
     of mineral rights and
     properties                   4,295       (644)        4,476       (644)
    Share-based
     compensation                   444         739        2,322       2,893
  Income tax paid               (1,110)     (5,914)      (6,571)    (28,237)
  Changes in non-cash
   operating working
   capital                      (1,823)       3,310        1,006      13,258
----------------------------------------------------------------------------
Net cash provided by
 operating activities             3,109      13,580       36,118      85,179
----------------------------------------------------------------------------

Investing activities
  Mineral rights and
   properties
    Capital expenditures       (14,270)    (14,202)     (56,797)    (56,057)
    Proceeds on disposals             -       1,750       13,349       1,750
  Plant and equipment
    Additions                   (5,339)    (10,418)     (18,370)    (35,141)
    Proceeds on disposals             -          80        1,418          80
  Other investments
    Acquisition                       -           -            -       (595)
  Net redemptions
   (purchases) of short-
   term investments               4,856      15,055       31,750     (1,184)
  Proceeds on sale of a
   subsidiary (net of cash
   disposed, $4)                      -           -        8,160           -
----------------------------------------------------------------------------
Net cash used in investing
 activities                    (14,753)     (7,735)     (20,490)    (91,147)
----------------------------------------------------------------------------

Financing activities
  Related parties
    Payments made                     -           -      (1,207)           -
    Repayments received               -       1,207            -       1,207
  Non-controlling interests
    Distribution                (1,353)       (636)      (6,521)    (15,248)
  Cash dividends
   distributed                  (3,893)     (4,291)     (16,331)    (17,111)
  Proceeds from issuance of
   common shares                      7          34          287         273
----------------------------------------------------------------------------
Net cash used in financing
 activities                     (5,239)     (3,686)     (23,772)    (30,879)
----------------------------------------------------------------------------

Effect of exchange rate
 changes on cash and cash
 equivalents                    (2,063)       (712)      (3,525)       (830)
----------------------------------------------------------------------------

Increase (decrease) in cash
 and cash equivalents          (18,946)       1,447     (11,669)    (37,677)

Cash and cash equivalents,
 beginning of the period         79,560      70,836       72,283     109,960
----------------------------------------------------------------------------

Cash and cash equivalents,
 end of the period             $ 60,614    $ 72,283     $ 60,614    $ 72,283
----------------------------------------------------------------------------


SILVERCORP METALS INC.
Mining Data
(Expressed in thousands of U.S. dollars, except for mining data figures)

----------------------------------------------------------------------------
                                    Three months ended March 31, 2014
                            ------------------------------------------------
                             Ying Mining
                             District(1)  X Mines(2)         BYP       Total
----------------------------------------------------------------------------

Production Data
  Mine Data
    Ore Mined (tonne)
      Direct Smelting Ore
       (tonne)                       393           -           -         393
      Stockpiled Ore(tonne)       89,664           -      20,791     110,455
                            ------------------------------------------------
                                  90,057           -      20,791     110,848
                            ------------------------------------------------
    Run of Mine Ore (tonne)
      Direct Smelting Ore
       (tonne)                       393           -           -         393
      Ore Milled (tonne)          90,879           -      18,675     109,554
                            ------------------------------------------------
                                  91,272           -      18,675     109,947
                            ------------------------------------------------

    Mining cost per tonne of
     ore mined ($)                 60.85           -       33.62       55.74
      Cash mining cost per
       tonne of ore mined
       ($)                         49.04           -       22.29       44.02
      Non cash mining cost
       per tonne of ore
       mined ($)                   11.81           -       11.33       11.72

    Unit shipping costs ($)         6.99           -           -        5.68

    Milling cost per tonne
     of ore milled ($)             19.93           -       16.15       19.28
      Cash milling cost per
       tonne of ore milled
       ($)                         15.08           -       14.40       14.96
      Non cash milling cost
       per tonne of ore
       milled ($)                   4.85           -        1.75        4.32

    Average Production Cost
      Silver ($ per ounce)          9.35           -           -        9.63
      Gold ($ per ounce)             534           -         736         595
      Lead ($ per pound)            0.44           -           -        0.45
      Zinc ($ per pound)            0.32           -           -        0.33

    Total production cost
     per ounce of Silver ($)        5.86           -                    5.86
    Total cash cost per
     ounce of Silver ($)            2.82           -                    2.82

    Total production cost
     per ounce of Gold ($)                                   736         736
    Total cash cost per
     ounce of Gold ($)                                       531         531

    Total Recovery of the
     Run of Mine Ore
      Silver (%)                    92.9           -                    92.9
      Gold (%)                                              93.7        93.7
      Lead (%)                      95.3           -                    95.3
      Zinc (%)                      62.4           -                    62.4

    Head Grades of Run of
     Mine Ore
      Silver (gram/tonne)            216           -                     216
      Gold (gram/tonne)                                      3.5         3.5
      Lead (%)                       2.7           -                     2.7
      Zinc (%)                       0.6           -                     0.6

Sales Data
  Metal Sales
    Silver (in thousands of
     ounces)                         582           -           -         582
    Gold (in thousands of
     ounces)                         0.4           -         1.9         2.3
    Lead (in thousands of
     pounds)                       5,165           -           -       5,165
    Zinc (in thousands of
     pounds)                         883           -           -         883

  Metal Sales
    Silver (in thousands of
     $)                            9,389           -           -       9,389
    Gold (in thousands of $)         425           -       1,918       2,343
    Lead (in thousands of $)       3,921           -           -       3,921
    Zinc (in thousands of $)         482           -           -         482
                            ------------------------------------------------
                                  14,217           -       1,918      16,135
                            ------------------------------------------------
  Average Selling Price, Net
   of Value Added Tax and
   Smelter Charges
    Silver ($ per ounce)           16.13           -           -       16.13
    Gold ($ per ounce)               921           -       1,016         997
    Lead ($ per pound)              0.76           -           -        0.76
    Zinc ($ per pound)              0.55           -           -        0.55

(1) Ying Mining District includes mines: SGX, TLP, HPG&LM.
(2) X Mines includes the XHP project.


SILVERCORP METALS INC.
Mining Data
(Expressed in thousands of U.S. dollars, except for mining data figures)

----------------------------------------------------------------------------
                                 Three months ended March 31, 2013
                       -----------------------------------------------------
                        Ying Mining
                        District(1)       X Mines(2)         BYP       Total
----------------------------------------------------------------------------

Production Data
  Mine Data
    Ore Mined (tonne)
      Direct Smelting
       Ore (tonne)            1,309           -                -       1,309
      Stockpiled Ore
       (tonne)              152,014           -  (i)      19,334     171,348
                       -----------------------------------------------------
                            153,323           -           19,334     172,657
                       -----------------------------------------------------
    Run of Mine Ore
     (tonne)
      Direct Smelting
       Ore (tonne)            1,309           -                -       1,309
      Ore Milled
       (tonne)              156,836      15,292  (i)      26,228     198,356
                       -----------------------------------------------------
                            158,145      15,292           26,228     199,665
                       -----------------------------------------------------

    Mining cost per
     tonne of ore mined
     ($)                      72.56           -            58.33       70.96
      Cash mining cost
       per tonne of ore
       mined ($)              61.67           -            26.35       57.71
      Non cash mining
       cost per tonne
       of ore mined ($)       10.89           -            31.98       13.25

    Unit shipping costs
     ($)                       3.90           -                -        3.47

    Milling cost per
     tonne of ore
     milled ($)               18.61           -            13.28       17.86
      Cash milling cost
       per tonne of ore
       milled ($)             16.05           -            12.17       15.50
      Non cash milling
       cost per tonne
       of ore milled
       ($)                     2.56           -             1.11        2.36

    Average Production
     Cost
      Silver ($ per
       ounce)                 11.10           -                -       11.63
      Gold ($ per
       ounce)                   544           -              871         600
      Lead ($ per
       pound)                  0.36           -                -        0.38
      Zinc ($ per
       pound)                  0.34           -                -        0.36

    Total production
     cost per ounce of
     Silver ($)                5.82           -                         5.82
    Total cash cost per
     ounce of Silver
     ($)                       3.65           -                         3.65

    Total production
     cost per ounce of
     Gold ($)                                                870         870
    Total cash cost per
     ounce of Gold ($)                                       493         493

    Total Recovery of
     the Run of Mine
     Ore
      Silver (%)               93.5           -                         93.5
      Gold (%)                                              92.0        92.0
      Lead (%)                 94.5           -                         94.5
      Zinc (%)                 60.3           -                         60.3

    Head Grades of Run
     of Mine Ore
      Silver
       (gram/tonne)             205           -                          205
      Gold (gram/tonne)                                      3.0         3.0
      Lead (%)                  2.9           -                          2.9
      Zinc (%)                  0.7           -                          0.7

Sales Data
  Metal Sales
    Silver (in
     thousands of
     ounces)                    933          11  (i)           -         944
    Gold (in thousands
     of ounces)                 0.8           -  (i)         1.5         2.3
    Lead (in thousands
     of pounds)               9,462         365  (i)           -       9,827
    Zinc (in thousands
     of pounds)               1,554         349  (i)           -       1,903

  Metal Sales
    Silver (in
     thousands of $)         21,883           -                -      21,883
    Gold (in thousands
     of $)                      921           -            1,938       2,859
    Lead (in thousands
     of $)                    7,277           -                -       7,277
    Zinc (in thousands
     of $)                    1,128           -                -       1,128
                       -----------------------------------------------------
                             31,209           -            1,938      33,147
                       -----------------------------------------------------
  Average Selling Price, Net of
   Value Added Tax and Smelter
   Charges
    Silver ($ per
     ounce)                   23.49           -                -       23.49
    Gold ($ per ounce)        1,151           -            1,285       1,226
    Lead ($ per pound)         0.77           -                -        0.77
    Zinc ($ per pound)         0.73           -                -        0.73

(1) Ying Mining District includes mines: SGX, TLP, HPG&LM.
(2) X Mines includes the XBG project and XHP project.
(i) Represents development tunnelling ore at the X mines.


SILVERCORP METALS INC.
Mining Data
(Expressed in thousands of U.S. dollars, except for mining data figures)

----------------------------------------------------------------------------
                                     Year ended March 31, 2014
                       -----------------------------------------------------
                        Ying Mining
                        District(1)       X Mines(2)         BYP       Total
----------------------------------------------------------------------------

Production Data
  Mine Data
    Ore Mined (tonne)
      Direct Smelting
       Ore (tonne)            2,574           -                -       2,574
      Stockpiled Ore
       (tonne)              622,692           -           88,210     710,902
                       -----------------------------------------------------
                            625,266           -           88,210     713,476
                       -----------------------------------------------------
    Run of Mine Ore
     (tonne)
      Direct Smelting
       Ore (tonne)            2,574           -                -       2,574
      Ore Milled
       (tonne)              631,919      10,425  (i)      88,297     730,641
                       -----------------------------------------------------
                            634,493      10,425           88,297     733,215
                       -----------------------------------------------------

    Mining cost per
     tonn

        



      

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