Sierra Metals : Q3 2023 Conference Call Slides

TSX: SMT | OTC: SMTSF

Third Quarter 2023 Results

Zn

Zinc

Cu

Copper

Pb

Lead

Conference Call & Webcast

Ag

Silver

Au

Gold

NOVEMBER 13, 2023

Forward Looking Information

Certain statements in this presentation constitute forward-looking information within the meaning of Canadian securities legislation. Forward-looking information relates to future events or the anticipated performance of Sierra Metals Inc. ("Sierra" or the "Company") and reflect management's expectations or beliefs regarding such future events and anticipated performance based on an assumed set of economic conditions and courses of action. In certain cases, statements that contain forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur" or "be achieved" or the negative of these words or comparable terminology.

These forward-looking statements include, but are not limited to: future production of silver, gold, lead, copper and zinc (collectively, the "metals"); future cash costs per ounce or pound of the metals; the price of the metals; the effects of domestic and foreign laws, regulations and government policies and actions affecting the Company's operations or potential future operations; future successful development of the Yauricocha Mine, the Bolivar Mine and the Cusi Mine and other exploration and development projects; relationships with and claims by local communities and indigenous populations; the sufficiency of the Company's current working capital, anticipated operating cash flow or the Company's ability to raise necessary funds; estimated production rates for the metals produced by the Company; timing of production; the estimated cost of sustaining capital; ongoing or future development plans and capital replacement, improvement or remediation programs; the estimates of expected or anticipated economic returns from the Company's mining projects; future sales of the metals, concentrates or other future products produced by the Company; implementation of programs; effects of renegotiation and termination of contracts or sub-contracts; refinancing of debt obligations (and the timing of same); future breaches of debt covenants; the Company's ability to obtain waivers for any potential future breaches of its debt covenants; the Company's ability to increase safety and employee engagement and the Company's plans and expectations for its properties and operations.

Such forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in such forward-looking information, including, without limitation, risks with respect to: liquidity and going concern risks and risks related to the inability of the Company to obtain waivers for any potential future breaches of its debt covenants; risk of foreign operations; burden of government regulation and permitting; operating hazards and risks; precious metal and base metal price fluctuation; mining operations; infrastructure; exploration and development; uncertainty of calculation of reserves and sources and metal recoveries; replacement of reserves and resources; fluctuations in the price of consumed commodities; no defined mineral reserves at the Cusi mine; political risks; risks relating to outstanding borrowings; uncertainty of title to assets; environmental risks; litigation risks; insurance risks; competitive risks; volatility in the price of the common shares of the Company; Corona not being a wholly-owned subsidiary; global financial risks; employee recruitment and retention; reliance on key personnel and labour relations; potential conflict of interest; significant shareholders; third party reliance; claim under U.S. securities laws; potential dilution of present and prospective shareholdings; currency risks; risks related to cyclical business; financial reporting standards; credit risks; climate change; COVID-19; and cyber security risks. This list is not exhaustive of the factors that may affect any of the Company's forward-looking information. Forward-looking information includes statements about the future and are inherently uncertain, and the Company's actual achievements or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors, including, without limitation, those discussed under "Risk Factors" in the Company's annual information form dated March 28, 2023 for its fiscal year ended December 31, 2022, which is available on SEDAR at www.sedar.com.

Although Sierra has attempted to identify important factors that could cause actual performance to differ materially from forward-looking information, there may be other factors that cause the Company's performance not to be as anticipated. Sierra neither intends nor assumes any obligation to update these statements containing forward-looking information to reflect changes in assumptions or circumstances other than as required by applicable law. There can be no assurance that forward-looking information will prove to be accurate as actual results and future events could differ materially from those currently anticipated. Accordingly, readers should not place undue reliance on forward-looking information.

This presentation may use the terms "measured", "indicated" and "inferred" to refer to "measured resources", "indicated resources" and "inferred resources", respectively, as such terms are recognized under National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") adopted by the Canadian Securities Administrators. Readers are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. In addition, "inferred resources" have a great amount of uncertainty as to their existence and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian securities rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, or economic studies, except for a "preliminary assessment" as defined under NI 43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.

The technical data and information in this presentation was reviewed by Ricardo Salazar Milla, Corporate Manager of Mineral Resources, a member of the Australian Institute of Geoscientist and a Qualified Person under National Instrument 43-101 - Standards of Disclosure for Mineral Projects.

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Forward Looking Information (Continued)

CAUTIONARY NOTE TO U.S. INVESTORS

This presentation has been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the requirements of the U.S. securities laws. In particular, and without limiting the generality of the foregoing, the terms "inferred mineral resources," "indicated mineral resources," "measured mineral resources" and "mineral resources" used or referenced in this presentation are Canadian mineral disclosure terms as defined in accordance with NI 43-101 under the guidelines set out in the 2014 Canadian Institute of Mining, Metallurgy and Petroleum Standards for Mineral Resources and Mineral Reserves, Definitions and Guidelines, May 2014 (the "CIM Definition Standards"). The CIM Definition Standards differ significantly from the historic standards in the United States included in U.S. Securities and Exchange Commission (the "SEC") Industry Guide 7.

The SEC has adopted amendments to its disclosure rules to modernize the mineral property disclosure requirements for issuers whose securities are registered with the SEC under the U.S. Securities Exchange Act of 1934, as amended. These amendments became effective February 25, 2019 (the "SEC Modernization Rules") with compliance required for the first fiscal year beginning on or after January 1, 2021. Under the SEC Modernization Rules, the historical property disclosure requirements for mining registrants included in SEC Industry Guide 7 will be rescinded and replaced with disclosure requirements in subpart 1300 of SEC Regulation S-K. The Company is not required to provide disclosure on its mineral properties under the SEC Modernization Rules and will continue to provide disclosure under NI 43-101 and the CIM Definition Standards.

As a result of the adoption of the SEC Modernization Rules, the SEC will recognize estimates of "measured mineral resources", "indicated mineral resources" and "inferred mineral resources." In addition, the SEC has amended its definitions of "proven mineral reserves" and "probable mineral reserves" to be "substantially similar" to the corresponding definitions under the CIM Definition Standards that are required under NI 43-101. Accordingly, during the period leading up to the compliance date of the SEC Modernization Rules, information regarding mineral resources or mineral reserves contained or referenced in this presentation may not be comparable to similar information made public by companies that report in accordance with U.S. standards. While the above terms are "substantially similar" to definitions under the CIM Definition Standards, there are differences in the definitions under the SEC Modernization Rules and the CIM Definition Standards. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as "proven mineral reserves", "probable mineral reserves", "measured mineral resources", "indicated mineral resources" and "inferred mineral resources" under NI 43-101 would be the same had the Company prepared the reserve or resource estimates under the standards adopted under the SEC Modernization Rules.

NON-IFRS MEASURES

Adjusted EBITDA and All-in Sustaining Costs are non-IFRS financial measures with no standardized meaning under International Financial Reporting Standards ("IFRS") and might not be comparable to similar financial measures disclosed by other issuers. Further information relating to these Non-IFRS financial measures is incorporated by reference from the "Non-IFRS Performance Measures" section of Sierra's MD&A for the three months ended March 31, 2023 dated May 11, 2023 filed with the Canadian securities regulatory authorities on SEDAR available at www.sedar.com.

NOTES

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All dollar amounts are in US dollars unless otherwise denoted.

Cusi mine has been classified as a non-core asset so its results are not included in the consolidated results and in 2023 guidance and it has been classified as Discontinued Operations in the financial statements with the historical results also reclassified.

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Safety - Our #1 Priority

CONSOLIDATED - YTD 2023

LTIFR	Loss Time Incident Frequency Rate = fatalities + Loss time incidents
TRIFR	Total Reportable Incident Frequency Rate = fatalities + Loss time incidents + Restricted duty + Medical case

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Consolidated Q3 2023: Operating Highlights

	Q3 2023	Q2 2023	Q3 2022	Q3 - Q3	9M 2023	9M 2022	Yr - Yr
	Change	Change
Tonnes processed	622,622	650,302	496,726	25%	1,791,086	1,572,991	14%
- Daily throughput	7,116	7,432	5,677		6,823	5,992
Silver production (koz)	458	523	327	40%	1,370	991	38%
Copper production (k lbs)	9,477	10,459	6,299	50%	28,221	20,957	35%
Lead production (k lbs)	4,084	3,930	3,579	14%	10,792	10,467	3%
Zinc production (k lbs)	11,176	12,228	10,815	3%	33,983	31,733	7%
Gold production (oz)	3,651	4,311	2,010	82%	11,753	6,121	92%
Copper equivalent pounds	18,496	20,246	14,593	27%	55,342	44,261	25%
(000's) (1)

• Produced 55.3 Mlbs CuEq (9M 2023) versus 56.1 M CuEq (12M 2022)

1. Copper equivalent pounds were calculated using the following realized prices:

Q3 2023 - $23.56/oz Ag, $3.78/lb Cu, $1.10/lb Zn, $0.98/lb Pb, $1,927/oz Au.

Q2 2023 - $24.17/oz Ag, $3.99/lb Cu, $1.16/lb Zn, $0.96/lb Pb, $1,977/oz Au.

Q3 2022 - $19.26/oz Ag, $3.51/lb Cu, $1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.

9M 2023 - $23.44/oz Ag, $3.94/lb Cu, $1.23/lb Zn, $0.97/lb Pb, $1,932/oz Au.

9M 2022 - $21.95/oz Ag, $4.12/lb Cu, $1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.

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Q3 2023: Bolivar

	Q3 2023	Q2 2023	Q3 2022	Q3 - Q3	9M 2023	9M 2022	Yr - Yr
	Change	Change
Tonnes processed	362,890	405,987	227,669	59%	1,067,894	671,597	59%
Cash costs (copper equivalent payable pound) (1)	$2.15	$1.62	$3.38	(36%)	$1.86	$3.71	(50%)
AISC (copper equivalent payable pound) (1) (2)	$3.57	$3.02	$5.12	(30%)	$3.24	$5.88	(45%)
Copper equivalent pounds (000's) (1)	8,100	10,721	3,799	113%	26,392	10,559	140%

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Increasing productivity and reducing costs

New primary crusher and engine Ore pass built

Improved ore control sequencing Additional specialized mining contractor Geo-mechanical study to redesign zones Increase mine signal coverage

1. Copper equivalent pounds were calculated using the following realized prices: Q3 2023 - $23.56/oz Ag, $3.78/lb Cu, $1.10/lb Zn, $0.98/lb Pb, $1,927/oz Au; Q2 2023 - $24.17/oz Ag, $3.99/lb Cu, $1.16/lb Zn, $0.96/lb Pb, $1,977/oz Au; Q3 2022 - $19.26/oz Ag, $3.51/lb Cu, $1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au; 9M 2023 - $23.44/oz Ag, $3.94/lb Cu, $1.23/lb Zn, $0.97/lb Pb, $1,932/oz Au; 9M 2022 - $21.95/oz Ag, $4.12/lb Cu, $1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.

(2) This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.	6

Q3 2023: Yauricocha

	Q3 2023	Q2 2023	Q3 2022	Q3 - Q3	9M 2023	9M 2022	Yr - Yr
	Change	Change
Tonnes processed	259,732	244,315	269,057	(3%)	723,192	901,394	(20%)
Cash costs (copper equivalent payable pound) (1)	$2.08	$2.29	$2.01	3%	$2.14	$2.09	2%
AISC (copper equivalent payable pound) (1) (2)	$3.75	$3.97	$3.36	12%	$3.62	$3.49	4%
Copper equivalent pounds (000's) (1)	10,396	9,525	10,794	(4%)	28,950	33,702	(14%)

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Increasing productivity and reducing costs

New mine manager

Raise borer project

Increase drill efficiency spacing

Reduced cyanide reagent

Ore pass and electrohydraulic hoppers

Increase mine signal coverage

1. Copper equivalent pounds were calculated using the following realized prices: Q3 2023 - $23.56/oz Ag, $3.78/lb Cu, $1.10/lb Zn, $0.98/lb Pb, $1,927/oz Au; Q2 2023 - $24.17/oz Ag, $3.99/lb Cu, $1.16/lb Zn, $0.96/lb Pb, $1,977/oz Au; Q3 2022 - $19.26/oz Ag, $3.51/lb Cu, $1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au; 9M 2023 - $23.44/oz Ag, $3.94/lb Cu, $1.23/lb Zn, $0.97/lb Pb, $1,932/oz Au; 9M 2022 - $21.95/oz Ag, $4.12/lb Cu, $1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.

(2) This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.	7

Consolidated Q3 2023: Financial Highlights

$ millions	Q3 2023	Q2 2023	Q3 2023	Q3-Q3	9M 2023	9M 2023	Yr-Yr
Change	Change
Revenue from metals payable	$57.0	$58.5	$35.2	62%	$168.9	$127.0	33%
Cash costs (copper equivalent payable pound) (1)	$2.11	$1.80	$2.39	(12%)	$2.00	$2.51	(20%)
AISC (copper equivalent payable pound) (1) (2)	$3.66	$3.24	$3.85	(5%)	$3.43	$4.11	(17%)
Adjusted EBITDA (2)	$8.1	$14.5	$(6.2)		$38.1	$10.3
Adjusted net income (loss) attributable to shareholders(2)	$(2.1)	$6.0	$(12.1)		$9.4	$(16.4)
- per share	$(0.01)	$0.04	$(0.07)		$0.06	$(0.10)
Net income (loss), excluding discontinued operations	$(2.8)	$3.9	$(38.1)		$4.7	$(52.1)
Operating cash flows before movements in working capital	$6.0	$11.6	$(6.8)		$30.5	$2.3

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C$16.4 million private placement in October 2023 Ongoing debt refinancing discussions

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Cusi placed on care and maintenance Cusi sale process underway

1. Copper equivalent pounds were calculated using the following realized prices: Q3 2023 - $23.56/oz Ag, $3.78/lb Cu, $1.10/lb Zn, $0.98/lb Pb, $1,927/oz Au; Q2 2023 - $24.17/oz Ag, $3.99/lb Cu, $1.16/lb Zn, $0.96/lb Pb, $1,977/oz Au; Q3 2022 - $19.26/oz Ag, $3.51/lb Cu, $1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au; 9M 2023 - $23.44/oz Ag, $3.94/lb Cu, $1.23/lb Zn, $0.97/lb Pb, $1,932/oz Au; 9M 2022 - $21.95/oz Ag, $4.12/lb Cu, $1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.

(2) This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.	8

2023 Guidance

Guidance Range	9M 2023 Actual

Consolidated CuEq pounds produced (000's) (1)	74,300 - 83,300	57,851
-	Silver (000 oz)	1,500	- 1,700	1,370
-	Copper (000 lbs)	37,300	- 42,400	28,221
-	Lead (000 lbs)	14,000	- 15,400	10,792
-	Zinc (000 lbs)	46,000	- 50,500	33,983
-	Gold (oz)	13,500	- 15,400	11,753
Yauricocha (copper equivalent payable pound) (1)
-	Production	40,000 - 44,000	31,460
-	Cash costs (2)/(3)	$1.81 - $1.88	$1.97
-	AISC (2)/(3)	$3.50 - $3.60	$3.34
Bolivar (copper equivalent payable pound) (1)
-	Production	34,500 - 39,500	26,391
-	Cash costs (2)/(3)	$1.92 - $2.05	$1.86
-	AISC (2)/(3)	$3.02 - $3.25	$3.24

On-track to meet 2023 guidance

(1) Guidance for copper equivalent pounds were calculated using the following metal prices: $21.03/oz Ag, $3.55/lb Cu, $1.35/lb Zn, $0.93/lb Pb, $1,741/oz Au. 9M-2023 Actual copper equivalent pounds produced have been recalculated using the same prices for comparison purposes.

(2) AISC includes treatment and refining charges, selling costs, G&A costs and sustaining capital expenditures. This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.

(3) These costs have been adjusted using copper equivalent pounds payable calculated at metals prices used for 2023 guidance as per note (1).

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Q3: Growing our Resources

Exploration

Bolivar

• Increased mineral resources by 15.5 million CuEq lbs in Q3 2023
• 17,540 meters drilled at Bolivar, Cieneguita and Dulce zones encountering skarn intersections with mineralization

Yauricocha

• Surface exploration continued near the mine to increase resources
• 2,295 meters drilled underground in the Fortuna, Pamela and Carmencita zones finding polymetallic mineralization

Level 1120 Permitting

• Access to a larger ore body
• Allows for bulk mining utilizing sub-level caving methods that will increase throughput and lower costs
• On track to obtain permits by year-end

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