Sierra Metals Reports Third Quarter Results; Conference Call November 16, 2015 at 10:00 AM (EST)

• Record silver equivalent production at the Cusi Mine; a 75% increase over Q3 2014
• 9% increase in copper equivalent production at the Bolivar Mine over Q3 2014
• Temporary decline in Yauricocha's mine output due to operating restructuring that should allow for new future growth plans
• Total tonnes of ore processed of 452,082; a 5% increase over Q3 2014
• On track to meet 2015 production guidance
• $32.1 million of cash and cash equivalents as at September 30, 2015
• Refinancing of $48 million Corona acquisition credit facility during 3Q15 added financial flexibility
• Conference Call to be held Monday November 16, 2015 at 10:00 AM (EST)

(All amounts expressed in US Dollars unless otherwise noted.)

TORONTO, Nov. 11, 2015 /CNW/ - Sierra Metals Inc. (TSX:SMT)(BVL:SMT) ("Sierra Metals" or the "Company") today reported revenue of $28.4 million and an adjusted EBITDA of $2.0 million on throughput of 452,082 tonnes and 2.4 million silver equivalent ounces or 16.2 million copper equivalent pounds for Q3 2015. The Company continues to be a low cost producer, maintaining its low operating costs again this quarter.

The company is currently undergoing operational improvements to increase safety, development and productivity at its Yauricocha Mine in an effort to increase production in the coming years. The Mine is undergoing various training programs using modern drifting techniques such as blast-control, ground support practices as well as the use of remote control Load Haul Dump equipment.  These improvements, while causing some reduced production in the near-term, will enable the Company to benefit from improved safety practices and future production increases.

"The company has been working to implement best practices and transition to modern technologies, equipment and methodologies which shall serve to increase production in the coming years", commented Mark Brennan, President and CEO of Sierra Metals.  "Despite lower production in the short-term at Yauricocha we are pleased the company has still maintained a solid quarter of production overall."  He continued, "Sierra continues to be a low cost producer with a strong balance sheet and we remain on track to fall within our 2015 production guidance.  The quality of our assets, being run by our experienced teams, will enable Sierra to continue on its growth path going forward."

The following table displays selected unaudited financial information for the three and nine months ended September 30, 2015:

			Three Months Ended				Nine Months Ended
(In thousands of dollars, except per share and cash cost amounts)			September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
Operating
	Ore Processed / Tonnes Milled			452,082		430,523		1,407,863		1,277,855
	Silver Ounces Produced			691,129		794,251		2,501,839		2,272,746
	Copper pounds produced (000's)			4,709		5,309		17,701		16,735
	Lead pounds produced (000's)			11,026		12,553		34,257		36,738
	Zinc pounds produced (000's)			9,332		14,668		32,812		40,857
	Gold ounces produced			2,026		2,143		6,864		7,127
	Copper Equivalent Pounds Produced (000's)^1			16,240		19,698		57,337		58,204
	Silver Equivalent Ounces Produced (000's)^1			2,436		2,955		8,601		8,731
	Cash Cost per Tonne Processed		$	43.27	$	40.25	$	39.77	$	40.58
	Cash Cost (recovery) per silver payable ounce (Yauricocha)^2		$	3.33	$	(24.26)	$	(7.25)	$	(21.71)
	Cash Cost per copper payable pound (Bolivar)^2		$	2.14	$	1.71	$	1.66	$	1.59
	Cash Cost per silver payable ounce (Cusi)^2		$	10.65	$	6.34	$	8.95	$	7.48
Financial
	Revenues		$	28,421	$	44,505	$	109,028	$	131,757
	Adjusted EBITDA^2		$	2,013	$	20,673	$	34,252	$	59,193
	Operating cash flows before movements in working capital		$	1,527	$	19,937	$	34,988	$	58,289
	Adjusted net income (loss) attributable to shareholders^2		$	(3,646)	$	8,287	$	7,707	$	24,913
	Net income (loss) attributable to shareholders		$	(6,761)	$	1,465	$	(6,219)	$	5,934
	Cash and cash equivalents		$	32,124	$	46,729	$	32,124	$	46,729
	Working capital		$	22,047	$	33,786	$	22,047	$	33,786

⁽¹⁾Silver equivalent ounces and copper equivalent pounds were calculated using the following metal prices: $20/oz Ag, $3.00/lb Cu, $0.85/lb Pb,
$0.95/lb Zn, $1,250/oz Au.

⁽²⁾Adjusted EBITDA includes adjustments for depletion and depreciation, interest expense and other financing costs, interest income, share-based
compensation, Foreign Exchange (gain) loss and income taxes; see non-IFRS Performance Measures section of the Company's MD&A.

Financial Update

The Company had cash and cash equivalents of $32.1 million as at September 30, 2015 compared to $41.3 million at the end of 2014. Cash and cash equivalents have decreased by $9.2 million during the first nine months of 2015 due to the capital expenditures incurred in Mexico and Peru of $29.9 million, dividends paid to non-controlling interest of $0.9 million and repayment of loans and credit facilities of $14.7 million, partially offset by $29.0 million of operating cash flow and proceeds from the issuance of a credit facility in Mexico of $8.0 million. Cash flow generated from operations before movements in working capital of $1.5 million for Q3 2015 compared to $19.9 million in Q3 2014.

Sierra Metals refinanced the remaining $48 million due on the Corona Acquisition Credit Facility ("the Facility") with Banco de Credito del Peru resulting in the deferral of $20 million of principal repayments, previously due in 2015 and 2016, due to the extension of the Facility to August 2020.  The reduced Interest rate is now equal to 3.65% plus 3M LIBOR vs the previous rate of 4.15% plus 3M LIBOR.

Revenue from metals payable of $28.4 million in Q3 2015 decreased compared to the $44.5 million earned in Q3 2014. Lower revenues were mainly the result of the decrease in the prices of silver 24%, copper 24%, lead 23%, zinc 23% and gold 13% in Q3 2015 compared to Q3 2014; the decrease in plant throughput and head grades for all metals, except gold, at Yauricocha; the decrease in silver and copper head grades at Bolivar and the decrease in gold head grades and recoveries at Cusi.

Cash cost (recovery) per silver payable ounce for Q3 2015 was $3.33 (Q3 2014: $(24.26)) at Yauricocha, cash cost per copper payable pound was $2.14 (Q3 2014: $1.71) at Bolivar for Q3 2015 and cash cost per silver payable ounce was $10.65 (Q3 2014: $6.34) at Cusi. The increase in cash costs at Yauricocha during Q3 2015 was due to the decrease in plant throughput, and silver head grades and recoveries, which resulted in fewer silver payable ounces. Also, there was an increase in operating costs related to de-watering areas of the mine and improving the safety and mining methods at the Mine. We also experienced a reduction in by-product credits, resulting from the lower metal prices mentioned above, and lower head grades for copper, zinc and lead. Bolivar's cash costs increased due to a reduction in by-product credits from the decline in silver and gold prices, an increase in equipment maintenance costs, and the decline in silver head grades and recoveries during Q3 2015. The increase in costs at Cusi was due to lower by-product credits due to lower gold head grades and recoveries and lower realized metal prices, partially offset by higher silver payable ounces due to the increased throughput and higher silver head grades and recoveries.

Adjusted EBITDA of $2.0 million for Q3 2015 decreased compared to $21.3 million in Q3 2014. The decrease in adjusted EBITDA in Q3 2015 is due to the decrease in revenues at all three mines, and the increase in costs at Yauricocha, mentioned previously.

Adjusted net income (loss) attributable to shareholders of $(3.7) million, or $(0.02) per share, for Q3 2015 decreased compared to $8.3 million, or $0.05 per share, for Q3 2014.

A large component of the net income (loss) for every period is the non-cash depletion charge in Peru, which was $6.2 million in Q3 2015 (Q3 2014: $8.3 million). The non-cash depletion charge is based on the aggregate fair value of the Yauricocha mineral property at the date of acquisition of Corona of $371.0 million amortized over the total proven and probable reserves of the mine. The Company has been successful in reducing the depletion expense year over year as a result of the increase in the mineral reserves at Yauricocha based on the NI 43-101 reports dated October 2012, November 2013 and March 2015.

Net income (loss) attributable to shareholders of $(6.8) million, or $(0.04) per share, for Q3 2015 compared to net income attributable to shareholders of $1.5 million, or $0.00 per share in Q3 2014.

Operational Update

The Company is on pace to meet our fiscal 2015 production guidance for silver equivalent ounces and copper equivalent pounds, and expects to stay within our capital expenditure guidance. Despite recognizing lower production at Yauricocha in the short-term, the implementation of best practices and modern mining methodologies will provide the opportunity to increase production and reduce costs in the coming years. The Company has maintained a solid quarter of consolidated production, including record silver equivalent production and plant throughput at the Cusi Mine.

Metal Production		Q3 2015		9M 2015		2015 Guidance
		Actual		Actual		Low		High
Ore Processed/tonnes milled			452,082		1,407,863		1,805,000		2,105,000
Silver ounces			691,129		2,501,839		3,144,000		3,688,000
Copper pounds (000's)			4,709		17,701		21,000		24,300
Lead pounds (000's)			11,026		34,257		44,300		51,800
Zinc pounds (000's)			9,332		32,812		41,900		48,900
Gold ounces			2,206		6,864		11,200		13,000
Silver equivalent ounces (000's)^(1)			2,436		8,601		10,800		12,600
Copper equivalent pounds (000's)^(1)(2)			16,240		57,337		72,000		84,000
Capital Expenditures ($ millions)		$	9.7	$	29.9	$	30.0	$	40.0

(1) Silver equivalent ounces & copper equivalent pounds were calculated using the following metal prices:
$20/oz Ag, $3.00/lb Cu, $0.85/lb Pb, $0.95/lb Zn, $1,250/oz Au.

(2) Copper equivalent pounds has been added to the fiscal 2015 guidance as Management believes it is
a useful measure to provide comparability between the Company's production and their peers.

Project Development Update

During Q3 2015, the total development advance for the Yauricocha Mine was 3,752 m, all using conventional jackleg drifting techniques with ground support using steel sets and some conventional ground support techniques. These development advances entailed level and access drifting, crosscuts, draw points and ramp development in areas at the central mine zone, Cachi Cachi, Mascota as well as three other areas of the mine. During Q3 2015, drainage holes were drilled on the 920 level at Yauricocha, including the installation of various vibrating wire piezometers. A drainage hole was drilled 283 m on the 920 level of the Antacaca Sur area of mine and we installed three vibrating wire piezometers at three different level locations in the drill hole. During Q3 2015, the Yauricocha tunnel was advanced 135 m and the Yauricocha shaft was advanced 51 m.

Mine development at Bolívar during Q3 totaled 1,602 metres. Most of these metres (783) were developed to prepare stopes for the El Fierro deposit, while 126 metres were developed to access the 1830 stope in the El Fierro deposit. The El Gallo deposit was developed 353 metres to provide access between the El Fierro and El Gallo deposits. Bolivar Development of 261 metres was performed at the Bolivar Northwest and Rosarios projects, including 79 metres to access the El Gallo and El Fierro deposits. The Company also continues to explore the La Sidra vein over a strike length of 1,300 metres. During Q2 2015, 3,362 meters were drilled with thirty holes. During Q3 2015, 2,946 metres were drilled with 10 holes and a third stage of drilling of 2,400 metres with 9 holes will be executed during Q4 2015.

Mine development drilling at Cusi during Q3 2015 totaled 2,139 metres, while exploration drilling totaled 703 metres in various different veins.

Exploration Update

At Yauricocha, the Company is continuing to drill for resource expansion along strike, and at depth, to ore zones in the Central Mine Area and Cachi Cachi Mine area. To the end of Q3 2015, the Company has drilled 31 holes totaling 7,099 meters of resource expansion. At Bolivar, the Company is attempting to determine the lateral extent of the El Fierro deposit and continues to explore the La Sidra vein. At Cusi, drilling continues to increase the resource size within numerous different veins.

Conference Call Webcast

Sierra Metals' senior management will host a conference call on Monday, November 16th, 2015 at 10:00 AM (E.S.T.) to discuss the Company's third quarter 2015 financial and operating results.

Via Webcast:

A live audio webcast of the meeting will be available on the Company's website

http://event.on24.com/r.htm?e=1092908&s=1&k=141454193D360CA410EBA230AA245D5D

The webcast along with presentation slides will be archived for 180 days on www.sierrametals.com

Via phone:

For those who prefer to listen by phone, dial-in instructions are below. To ensure your participation, please call approximately five minutes prior to the scheduled start time of the call.

Participant Number (Toll Free Peru): 0800-53-840
Participant Number (Toll Free North America): [phone] 
Participant Number (International): [phone]
Conference ID: 77830592

Quality Control

All production technical data contained in this news release has been reviewed and approved by Gordon Babcock, P.Eng., Chief Operating Officer and a Qualified Person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects.

About Sierra Metals

Sierra Metals Inc. is a Canadian mining company focused on precious and base metals from its Yauricocha Mine in Peru, its Bolivar Mine and Cusi Mine in Mexico. In addition, Sierra Metals is exploring several precious and base metal targets in Peru and Mexico. Projects in Peru include Adrico (gold), Victoria (copper-silver) and Ipillo (polymetallic) at the Yauricocha property in the province of Yauyos and the San Miguelito gold properties in Northern Peru. Projects in Mexico include Bacerac (silver) in the state of Sonora, and La Verde (gold) at the Batopilas property in the state of Chihuahua.

The Company's shares trade on the Bolsa de Valores de Lima and the Toronto Stock Exchange under the symbol "SMT".

Forward-Looking Statements

Except for statements of historical fact contained herein, the information in this press release may constitute "forward-looking information" within the meaning of Canadian securities law. Statements containing forward-looking information express, as at the date of this news release, the Company's plans, estimates, forecasts, projections, expectations or beliefs as to future events or results. These statements reflect the Company's current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which filings are available at www.sedar.com.

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regarding Sierra Metals, please visit www.sierrametals.com or contact: Mike McAllister, Director - Corporate Development, Sierra Metals Inc., 1 [phone], [email protected]; Ed Guimaraes, CFO, Sierra Metals Inc., 1 [phone]; Mark Brennan, President & CEO, Sierra Metals Inc., 1 [phone]