Santacruz Silver Q2 2026: Strong Financials, Bolivia Concentrate Sales Shift Into Q3, Catalysts Stack Into Year-End

## Q2 2026 delivered across the P&L, but the headline is what shifts into Q3

Santacruz Silver Mining's Executive Chairman and CEO Arturo Prestamo joined the KE Report to walk through Q2 2026 results, and the read for investors is straightforward: the quarter was strong, but the bigger near-term story is the concentrate sales rolling from Q2 into Q3.

### The Q2 numbers

Compared to Q2 2025, the host read revenue up 55%, gross profit up 102%, adjusted EBITDA up 74%, cash and liquid marketable securities up 82%, and working capital up 43%. Cost discipline improved quarter-over-quarter as well: the all-in sustaining cost (AISC — what it really costs to produce an ounce) fell from roughly $29/oz in Q1 2026 to just under $22/oz in Q2.

### The Bolivia blockage — and why Q3 is set up

First-half silver production reached almost 2.2 million ounces, but ounces sold came in around 1.8 million. The gap, the CEO explained, came from road blockages in Bolivia that lasted 53 days during the quarter. Mills kept running normally, but trucked concentrate shipments stalled while rail-shipped concentrate moved through. Roughly 3,000 tons of concentrate piled up in storage patios — worth about $24–25 million at then-current prices — with around 95% already shipped out by the time of the interview.

That backlog is the direct read-through into Q3: production is normalizing, the deferred concentrate sales are landing, and roughly $25 million of additional receivable collections are in train. On the CEO's framing, Q3 should benefit on both the operational and cash-collection sides.

### What compressed reported net income

Two non-operating items hit the P&L and explain the gap between the operational beat and a reported comprehensive income for the period of roughly $2.7 million:

- **CVR mark-to-market (~$16M).** Santacruz has contingent value rights (CVRs) tied to the Bolivian mines, a capped $77 million structure that triggers when zinc averages above $3,860 per ton for the month. At trigger, $1.3 million per month is owed to Glencore, capped at the $77 million total. The CEO argued that for every $1 million paid out, the company nets $7–8 million from elevated zinc prices, and the structure runs for seven years or until amortized. The Q2 hit was a non-cash revaluation as zinc moved toward the trigger. - **Deferred tax (~$36M).** A deferred tax expense tied to the Bolivian currency devaluation. Bolivia's official exchange rate moved from 6.9 to roughly 11.9 Bolivianos per USD in Q2, creating a paper FX gain on USD-denominated balances and a corresponding deferred tax. The CEO emphasized this is not a cash payment this year.

### Operations

**Bolivar (Bolivia).** The mine is mid-dewatering after flooding and is targeted for full production by Q4 2026. The dewatering window pushed the team to scout for new high-grade blocks; two new areas with meaningful silver content are being prepared, with production expected by year-end or early next year. The CEO's claim is that Bolivar returns stronger than it was before the flooding.

**Zimapan (Mexico).** A maiden NI 43-101 resource estimate is being prepared — the prior estimate was non-compliant. Drilling continues at the Carrascale mine (level 960), and notably the Monte mine is being drilled for the first time in roughly 15 years, with two rigs active. The CEO described intersects as "fantastic," with assays to follow.

**Soracaya.** Permits expected in early September will allow 350 tonnes/day. At full production the asset is targeted at 3 million ounces of silver-equivalent per year, mostly pure silver. A team of roughly 45 miners plus the general manager is in place and most underground equipment is on site, with small initial production targeted by year-end.

### Capital, balance sheet, and valuation

Cash grew by over $7 million during the quarter. The CEO put treasury at north of $120 million, supported by the Q3 receivable collection and final Mexican settlements of about $22 million. The company is debt-free apart from Bolivian working-capital promissory notes at 10%, which the CEO framed as accretive against Bolivian inflation near 15%. Near-term catalysts the CEO flagged: a planned up-listing from TSX-V to TSX in September, the maiden Zimapan resource, and ongoing resource updates across the Bolivian mines. The CEO's claim, attributed to him, is that Santacruz trades at a fraction of peer market caps with comparable production.