1. Healthcare

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February 2015
San Jose Mine, Mexico
BUILDING A LEADING SILVER MINER
Regulatory Disclaimer
This corporate presentation contains forward looking statements which constitute “forward looking information” within the meaning of applicable
Canadian securities legislation and “forward looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995 (collectively, “Forward looking Statements”). All statements included herein, other than statements of historical fact, are Forward
looking Statements and are subject to a variety of known and unknown risks and uncertainties which could cause actual events or results to differ
materially from those reflected in the Forward looking Statements. The Forward looking Statements in this corporate presentation may include, without
limitation, statements about the company’s plans for its mines and mineral properties; the company’s business strategy, plans and outlook; the merit of
the company’s mines and mineral properties; mineral resource and reserve estimates; timelines; the future financial or operating performance of the
company; expenditures; approvals and other matters. Often, but not always, these Forward looking Statements can be identified by the use of words
such as “estimate”, “estimated”, “potential”, “open”, “future”, “assumed”, “projected”, “calculated”, “used”, “detailed”, “has been”, “gain”, “upgraded”,
“expected”, “offset”, “limited”, “contained”, “reflecting”, “containing”, “conduct”, “increasing”, “remaining”, “to be”, “periodically”, or statements that
events, “could” or “should” occur or be achieved and similar expressions, including negative variations.
Forward‐looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or
achievements of the company to be materially different from any results, performance or achievements expressed or implied by the Forward‐looking
Statements. Such uncertainties and factors include, among others, changes in general economic conditions and financial markets; changes in prices for
silver and other metals; technological and operational hazards in Fortuna’s mining and mine development activities; risks inherent in mineral
exploration; uncertainties inherent in the estimation of mineral reserves, mineral resources, and metal recoveries; the timing and availability of
financing; governmental and other approvals; political unrest or instability in countries where Fortuna is active; labor relations issues; as well as those
factors discussed under “Risk Factors” in the Company's Annual Information Form. Although the Company has attempted to identify important factors
that could cause actual actions, events or results to differ materially from those described in Forward‐looking Statements, there may be other factors
that cause actions, events or results to differ from those anticipated, estimated or intended.
Forward‐looking Statements contained herein are based on the assumptions, beliefs, expectations and opinions of management, including but not
limited to estimates of future production levels; expectations regarding mine production costs; expected trends in mineral prices and currency exchange
rates; the accuracy of the company’s current mineral resource and reserve estimates; that the company’s activities will be in accordance with the
company’s public statements and stated goals; that there will be no material adverse change affecting the company or its properties; that all required
approvals will be obtained; that there will be no significant disruptions affecting operations and such other assumptions as set out herein. Forward‐
looking Statements are made as of the date hereof and the Company disclaims any obligation to update any Forward‐looking Statements, whether as a
result of new information, future events or results or otherwise, except as required by law. There can be no assurance that Forward‐looking Statements
will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, investors
should not place undue reliance on Forward‐looking Statements.
Thomas I. Vehrs, Ph.D., Vice President of Exploration, is the Qualified Person for Fortuna Silver Mines Inc. as defined by National Instrument 43‐101. Dr.
Vehrs is a Founding Registered Member of The Society for Mining, Metallurgy, and Exploration, Inc. (SME Registered Member Number 3323430RM) and
is responsible for ensuring that the technical information contained in this presentation is an accurate summary of the original reports and data
provided to or developed by Fortuna Silver Mines Inc.
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2
Our Vision
To be valued by our workers, the community and our shareholders
as a leading silver mining company in Latin America
Caylloma Mine, Peru
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3
Core Assets
Proven mine builders and strong operators in the Americas
Production
• Increasing silver and gold production
• Low cost silver mines
Corporate Office
Vancouver, Canada
• 2015E AISCC*:
• Caylloma Mine = US$12.78/oz Ag
• San Jose Mine** = US$16.27/oz Ag
• Consolidated = US$16.61/oz Ag
MEXICO
SAN JOSE MINE
Silver, Gold
Oaxaca, Mexico
Management
Head Office
Brownfields Exploration
• At San Jose, Trinidad North zone step-out
drilling continues from UG drill stations
Lima, Peru
PERU
CAYLLOMA MINE
Silver, Lead, Zinc
Arequipa, Peru
• Evaluation and target generation work within
company’s commanding land packages
(*) AISCC = All-in sustaining cash cost is net of by-product credits for gold, lead and zinc
(**) Includes US$5.96/oz attributed as sustaining capital investments related to the dry stack tailings filter facility and deposit
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4
Capital structure and share performance
Strong financial position to support organic growth strategy
Strong Financial Position
•
•
•
•
US$72.3 M in cash (end Q3 2014)
US$40.0 M untapped credit facility
No long term debt
No hedging
Share Structure (as of 20JAN15)
Exchanges
Outstanding: 128.8 million
Fully diluted: 131.5 million
NYSE: FSM
TSX: FVI
BVL: FVI
Frankfurt: F4S.F
Relative Performance of FVI.T (23JAN14 – 23JAN15)
Fortuna Silver Mines (FVI‐TSE)
Silver (London PM Fixing)
XAU Index
60%
50%
Performance (%)
40%
+37%
30%
20%
10%
0%
-9%
‐10%
-15%
‐20%
‐30%
1/23/14
Jan-23
2/03/14
Feb-03
2/12/14
Feb-12
2/24/14
Feb-24
3/05/14
Mar-05
3/14/14
Mar-14
3/25/14
Mar-25
Apr-03
4/03/14
Apr-14
4/14/14
Apr-24
4/24/14
May-05
5/05/14
May-14
5/14/14
May-23
5/23/14
Jun-04
6/04/14
Jun-13
6/13/14
Jun-24
6/24/14
Jul-03
7/03/14
Jul-15
7/15/14
Jul-24
7/24/14
Aug-04
8/04/14
Aug-13
8/13/14
Aug-22
8/22/14
Sep-03
9/03/14
Sep-12
9/12/14
Sep-23
9/23/14
Oct-02
10/02/14
Oct-13
10/13/14
Oct-22
10/22/14
Oct-31
10/31/14
Nov-11
11/11/14
Nov-20
11/20/14
Dec-02
12/02/14
Dec-11
12/11/14
Dec-22
12/22/14
Jan-02
1/02/15
Jan-13
1/13/15
Jan-23
1/23/15
‐40%
Source: FactSet
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5
Key Milestones
Foundations of a leading silver mining company
Caylloma Mine, Peru
San Jose Mine, Mexico
Trinidad North UG drilling, San Jose Mine
2005–2007
2009–2011
2013–2016
• Fortuna Silver Mines Inc.
established
• Acquired 100 % interest in
the San Jose project
• Re-started production at
the Caylloma Mine
• Construction and commissioning
of the San Jose Mine;
commercial production declared
at 1,000 tpd
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• Trinidad North high-grade
silver-gold discovery at the
San Jose Mine
• Expansion of the San Jose Mine
to 3,000 tpd initiated in 1Q15;
commissioning planned for
mid-2016
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6
Growing Reserve and Resource Base
Strong growth in Reserves and Resources at San Jose
120
Proven & Probable Reserves
Measured & Indicated Resources
100
Contained Metal - Ag Eq (Moz)*
Inferred Resources
80
60
40
20
0
2005
(*)
(**)
2006
2007
2008
2009
2010
2011
2012
2013
2014**
Ag Eq calculated using Au = US$1,140/oz and Ag = US$19/oz
Caylloma Mine as of December 31, 2013 and San Jose Mine as of June 30, 2014
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7
Consolidated Ag Eq Production
Consolidated production rate of 12 Moz Ag Eq by mid-2016
14.0
Caylloma Mine, Peru
San Jose Mine, Mexico
12.0
Ag Eq Moz**
10.0
8.0
9.8
8.0
6.0
4.0
3.0
6.4
6.3
3.6
0.8
2.0
0.6
0.9
2007
2008
0.0
(*)
(**)
1.9
2.1
2.1
2.2
2.2
2.3
2.3
2.1
2.1
2009
2010
2011
2012
2013
2014
2015E
2016E
2017E
CAGR = Compound Annual Growth Rate
Ag Eq calculated using silver to gold ratio of 60 to 1
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8
Increasing Silver and Gold Production
Low cost organic growth
9.0
8.0
Consolidated Silver Production
Caylloma Mine, Peru
San Jose Mine, Mexico
7.0
Moz
6.0
5.0
4.0
3.0
1.9
4.3
6.7
2.5
0.5
2.0
1.0
0.0
4.4
5.5
0.4
0.8
2007
2008
1.7
1.9
2.0
2.0
2.1
2.2
2.2
2.0
2.0
2009
2010
2011
2012
2013
2014
2015E
2016E
2017E
Consolidated Gold Production
60,000
Caylloma Mine, Peru
San Jose Mine, Mexico
50,000
oz
40,000
30,000
52,300
20,000
33,500
17,900
10,000
0
33, 300
41,800
19,000
3,300
2,200
2,700
2,600
4,600
2,400
2,800
2,200
1,800
1,900
1,700
1,600
2007
2008
2009
2010
2011
2012
2013
2014
2015E
2016E
2017E
(*) CAGR = Compound Annual Growth Rate
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9
Financial Snapshot
Maximizing margins through management of cost and capital
Revenue
Cash Flow from Operations
(US$ M)
(US$ M)
161.0
110.0
51.4
2009
179.5
137.4
40.9
39.1
74.1
2010
62.2
51.4
24.4
2011
2012
2013
2014E*
2010
2011
2012
2013
Adjusted Earnings Per Share**
Cash Flow Per Share
(US$)
(US$)
0.06
0.13
0.04
0.02
0.12
2014E*
0.14
0.09
0.06
0.02
0.00
Q3 2013
Q4 2013
Q1 2014
Q2 2014
Q3 2014
Q3 2013
Q4 2013
Q1 2014
Q2 2014
Q3 2014
(*)
2014E: Au = US$1,300/oz, Ag = US$22/oz, Pb = US$2,100/t and Zn = US$1,900/t
(**) Net of income tax
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10
Caylloma Mine, Peru
Snapshot
Commodities
Ownership
Silver, zinc, lead
100 %
Operation
Deposit Type
1,300 tpd underground mine
Intermediate sulphidation
epithermal deposit
Reserve Life
8 Years
Location
Caylloma Mine
Arequipa, Peru
2015E AISCC*,
net of by-products Au, Pb and Zn
US$12.78/oz Ag
Silver Production
2.2
2.2
2.1
Moz
2.0
2.2
2.1
2.0
2.0
2.0
2.0
2016E
2017E
1.9
1.8
1.7
1.6
1.5
2011
2012
2013
2014
2015E
(*) AISCC = All-In Sustaining Cash Cost
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11
San Jose Mine, Mexico
Snapshot
Commodities
Ownership
Silver, gold
100 %
Operation
Deposit Type
2,000 tpd underground mine
High-grade, low sulphidation
epithermal deposit
Reserve Life
5.2 Years
2015E AISCC*,
net of by-products Au
Location
US$16.27/oz Ag
Oaxaca, Mexico
San Jose Mine
Silver Production
Gold Production
6.7
7.0
60.0
52.3
6.0
5.5
50.0
41.8
5.0
4.4
4.3
40.0
33.5 33.3
3.0
2.5
1.9
2.0
1.0
0.0
0.5
koz
Moz
4.0
30.0
17.9 19.0
20.0
10.0
4.6
0.0
2011 2012 2013 2014 2015E 2016E 2017E
2011 2012 2013 2014 2015E 2016E 2017E
(*) AISCC = All-In Sustaining Cash Cost; Includes US$5.96/oz attributed as sustaining capital investments related
to the dry stack tailings filter facility and deposit
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12
San Jose Mine: Trinidad North Discovery
Mineral Reserves and Resources as of June 30, 2014
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San Jose Mine: Trinidad North Discovery
Step-out drilling highlights – Trinidad Vein
• Characterized by
high-grades and
wide widths
• Contiguous with
existing
operation
• Mineralization
open at depth
and to the north
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San Jose Mine: Trinidad North Discovery
Exploration potential: Never stop drilling
Trinidad North 2014 boundary
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15
San Jose Mine: Trinidad North Discovery
Section 1847500N
• Silver-gold mineralization hosted by
hydrothermal breccias, crackle breccias
and quartz-carbonate vein stockworks
in extensional fault system
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16
San Jose Mine, Mexico
3,000 tpd mill expansion project
• Estimated CAPEX = US$30 million
• M3, EPCM contractor, has initiated detailed engineering
• Commissioning of mill expansion to 3,000 tpd expected by mid-2016
• Mill expansion allows for annual production of approximately 7 - 8 Moz Ag + 52 - 57 koz Au
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17
San Jose Mine, Mexico
Mine architecture
Production blocks
Trinidad North 2014 boundary
Mineral Reserves
Mineral Resources
Proven
Probable
Measured
Indicated
Inferred
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m
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San Jose Mine, Mexico
Dry stack tailings disposal project
• Estimated capex = US$32 million
TAILINGS STORAGE FACILITY
• Long term tailings disposal secured
• Project fully permitted
DRY STACK TAILINGS DISPOSAL
• Construction activities initiated for the dry stack deposit and the filter plant
• Purchase orders placed for long lead items
• Commissioning expected by Q4 2015
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19
San Jose Mine, Mexico
Miocene epithermal belt – Southern Mexico and CA
• San Jose deposit
centrally located in
prolific Miocene
Epithermal Belt
• World class or giant
silver deposit*
• World class neighbors:
Pachuca, Marlin and
Escobal
(*) Largest 10% of deposits based
on metal content
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20
San Jose Mine, Mexico
Mineral concessions: 64,408 hectares
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21
San Jose Mine, Mexico
Brownfields exploration: Trinidad North, Magdalena
• Mineralized system open along strike to NNW
• Surface exploration subject to access
agreement with Magdalena community
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22
San Jose Mine, Mexico
Brownfields exploration: Tlacolula prospect
• Select channel sample results
Width (meters) – Ag Eq (g/t)
• Outcropping, untested low sulfidation
epithermal vein system
• Access permitting in-process for initial drill
testing
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23
San Jose Mine, Mexico
Brownfields exploration: Tlacolula prospect
Güila Vein: 6.30 m @ 2,056 g/t Ag Eq
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24
San Jose Mine, Mexico
Brownfields exploration: La Noria prospect
• La Noria Project located approximately 2 km
west of San Jose Mine
• Northwest trending structural system subparallel and connected to Trinidad System
by several extensional veins
• 6 drill holes totaling 1,344 meters
completed in 2007 by Aura Silver/Intrepid
Mines
• Detailed surface mapping and sampling of
La Noria vein system in-progress
• Best drill intercept: 0.55 m @ 66 g/t Ag and
3.49 g/t Au
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25
Growth Strategy
Focused on organic growth, disciplined M&A
Maximize production,
profitability and sustainable
free cash flow generation
• San Jose Mine expanded to 2,000
tpd in April 2014
• Commissioning of San Jose Mine mill
expansion to 3,000 tpd planned for
mid-2016
BUILDING A LEADING SILVER MINER
Capitalize on
Trinidad North silver-gold
discovery
• Robust mineralization with
potential for further resource
expansion along strike and to
depth
• Exploration potential for new
discoveries on commanding land
position
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26
Investment Highlights
A leading silver mining company in the Americas
1
Proven mine developers and strong operators
• Increasing silver - gold production
• San Jose mill expansion to 3,000 tpd commissioning planned for
mid-2016
2
Strong treasury
• US$72.3 M in cash (end Q3 2014)
• US$40.0 M untapped credit facility
• Sustainable free cash flow generation
3
2015 production guidance
• 6.5 Moz Ag
• 35.3 koz Au
• 28.8 Mlbs Zn
• 19.4 Mlbs Pb
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27
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Contact information:
Carlos Baca, Investor Relations Manager
T: +51.1.616.6060, ext. 0
[email protected]
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28
APPENDIX
Senior Management
Jorge A. Ganoza
President, CEO and Director
Co-founder of Fortuna. Peruvian geological
engineer. Identified and negotiated purchase
of Caylloma, built the Fortuna team. Jorge
also serves as Chairman of the Board of
Atico Mining Corporation.
Dr. Thomas I. Vehrs
Vice President, Exploration
Over 40 years experience managing
exploration programs in the Americas. Tom
also serves as an independent director for
AQM Copper Inc.
Manuel Ruiz-Conejo
Vice President, Operations
Over 25 years experience in the
execution of multi-million dollar mining
projects and the implementation of
community relations programs.
Jose Pacora
Vice President, Project Development
Over 30 years experience in the mining
industry working for both engineering
firms and mining companies developing
strong capabilities in engineering,
construction and project management.
Luis Dario Ganoza
Chief Financial Officer
Over 15 years experience in the operations
and financial management of public mining
companies. Luis also serves as a Director of
Atico Mining Corporation.
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29
APPENDIX
Board of Directors
Simon Ridgway, Chairman of the Board
Co-founder of Fortuna. Vancouver-based
mining financier. Also founded Focus
Ventures, Radius Gold, Mar West Resources
and Northland Resources.
Jorge A. Ganoza, President and CEO
Co-founder of Fortuna. Peruvian geological
engineer. Identified and negotiated
purchase of Caylloma, built the Fortuna
team. Jorge also serves as Chairman of the
Board of Atico Mining Corporation.
Robert R. Gilmore
30 years of experience working with
resource companies and currently serves as
Chairman of the Board for Eldorado Gold
Corporation and as a Director for Layne
Christensen Company.
Michael Iverson
Chief Executive Officer of Fortuna from
1998 to January 2005. President and
Director of Niogold Mining Corp. since
1998.
Thomas Kelly
36 years of experience in mine
production, minerals industry consulting
and corporate management in various
Latin American countries. Currently
serves as COO of Atico Mining
Corporation.
Mario Szotlender
Co-founder of Fortuna. Financier,
businessman and Director of Radius
Gold, Endeavour Silver, Magellan, Focus
Ventures and Iron Creek.
David Farrell
President of Davisa Consulting, a private
consulting firm working with global mining
companies. Successfully closed over US$25
billion in M&A transactions. Director of
Northern Vertex Mining Corp.
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30
Trinidad North discovery drilling highlights
Hole_Id
From
(m)
To
(m)
Interval
(m)
ETW*
(m)
Ag
(g/t)
Au
(g/t)
SJOM-335
419.00
425.30
6.30
3.7
3,511
15.04
4,413
SJOM-337
314.90
324.35
9.45
6.5
498
3.03
680
SJOM-340
265.70
273.00
7.30
4.2
2,762
14.46
3,630
• Estimated true widths of
up to 18.8 meters
SJOM-343
272.00
286.95
14.95
10.2
1,190
8.45
1,697
SJOM-345
397.65
416.60
18.95
10.3
305
2.44
452
• Ag Eq values range to
4.4 kg/t
SJOM-346
293.50
303.50
10.00
6.5
1,503
7.76
1,969
340.50
368.00
27.50
18.8
600
4.20
852
320.00
330.20
10.20
4.5
929
4.87
1,221
367.00
375.45
8.45
4.1
1,808
13.21
2,601
SJOM-359
389.25
395.30
6.05
3.4
887
4.04
1,129
SJOM-364
462.05
467.30
5.25
3.0
2,573
10.77
3,219
SJOM-369
355.30
361.00
5.70
3.3
1,029
5.94
1,385
SJOM-378
391.15
398.30
7.15
4.9
467
1.93
583
SJOM-386
321.45
348.50
27.05
13.0
399
2.15
528
SJOM-390
413.85
421.90
8.05
4.0
636
2.93
812
(*) ETW = Estimated True Width
SJOM-395
414.70
420.95
6.25
3.3
854
4.97
1,152
(**) Ag Eq values calculated at Au:Ag ratio of 60 based on
assumed metal prices of Au = US$1,140/oz and Ag = US$19/oz
and metallurgical recoveries of 89 % for both gold and silver
SJOM-401
including
339.95
374.90
34.95
18.0
426
2.62
583
343.05
352.00
8.95
4.6
1,282
8.11
1,768
• Above average widths
and grades
SJOM-349A
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Ag Eq**
(g/t)
31
San Jose Mine, Mexico
NI 43 – 101 Reserves and Resources
Classification
Proven & Probable Reserves
4,303
225
1.75
31.2
242.6
802
80
0.72
2.1
18.5
7,127
257
1.75
58.9
400.8
Measured & Indicated Resources
Inferred Resources
Ag
(g/t)
Au
(g/t)
Contained Metal
Tonnes
(000)
Ag
(Moz)
Au
(koz)
Mineral Reserve and Mineral Resource estimates prepared in accordance with NI 43 - 101:
1. Mineral Reserves and Mineral Resources are as defined by CIM Definition Standards on Mineral Resources and Mineral Reserves
2. Mineral Resources are exclusive of Mineral Reserves
3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
4. There are no known legal, political, environmental or other risks that could materially affect the potential development of the Mineral Resources or
Mineral Reserves at San Jose
5. Mineral Resources and Mineral Reserves are estimated and reported as of June 30, 2014
6. Mineral Reserves for San Jose are estimated using a break-even cut-off grade of 128 g/t Ag Eq based on assumed metal prices of US$21/oz Ag and
US$1,260/oz Au; estimated metallurgical recovery rates of 89% for Ag and 89% for Au; and projected operating costs for year-end 2014. Mineral
Resources are estimated at a Ag Eq cut-off grade of 100 g/t, with Ag Eq in g/t = Ag (g/t) + Au (g/t) * ((US$1,260/US$21) * (89/89))
7. Totals may not add due to rounding procedures
BUILDING A LEADING SILVER MINER
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32
Caylloma Mine, Peru
NI 43 – 101 Reserves and Resources
Classification
Tonnes
(000)
Ag
(g/t)
Au
(g/t)
Pb
(%)
Zn
(%)
Proven & Probable Reserves
3,083
137
0.40
1.69
Measured & Indicated Resources
1,989
76
0.30
Inferred Resources
6,184
121
0.50
Contained Metal
Ag
(Moz)
Au
(koz)
2.49
13.5
39.4
1.08
2.07
4.9
19.4
2.11
2.97
24.0
100.2
Mineral Reserve and Mineral Resource estimates prepared in accordance with NI 43 - 101:
1. Mineral Reserves and Mineral Resources are as defined by CIM Definition Standards on Mineral Resources and Mineral Reserves
2. Mineral Resources are exclusive of Mineral Reserves
3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
4. There are no known legal, political, environmental, or other risks that could materially affect the potential development of the Mineral Resources or
Mineral Reserves at Caylloma
5. Mineral Resources and Mineral Reserves are estimated as of June 30 and are reported as of December 31, 2013 taking into account productionrelated depletion for the period through December 31, 2013
6. Mineral Reserves for Caylloma are estimated using break-even cut-off grades based on estimated NSR values using assumed metal prices of
US$24.00/oz Ag, US$1,400/oz Au, US$2,100/t Pb and US$1,900/t Zn; metallurgical recovery rates of 82% for Ag, 45% for Au, 93% for Pb and 88%
for Zn; and projected operating costs for year-end 2013. Caylloma Mineral Resources are reported based on estimated NSR values using assumed
metal prices of US$25.14/oz Ag, US$1,391.63/oz Au, US$2,116/t Pb and US$2,028/t Zn; metallurgical recovery rates as detailed for Mineral
Reserves; and an NSR cut-off grade of US$50/t
7. Totals may not add due to rounding procedures
BUILDING A LEADING SILVER MINER
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