Silvercorp Metals Inc. (NYSE-A/TSX: SVM; FRA: S9Y) is a good example of what happens when an emerging silver bull market meets a company that, thanks to careful planning and disciplined cost control, has been growing steadily for years – largely financing itself from its own cash flow. In fact, for the silver producer, fiscal year 2026 has already begun, as the company’s fiscal year ends on March 31. For the past fiscal year 2025, the company reported revenue of $298.9 million (previous year: $215.2 million), a net profit of $58.2 million (previous year: $36.3 million), and a record production of 6.9 million ounces of silver (previous year: 6.2 million ounces). Earnings per share (undiluted) were $0.29. According to the company, a particularly important measure of financial flexibility is free cash flow after investments – this amounted to $52.6 million in 2025.
For the current fiscal year 2026, the company has announced a further increase in silver production to 7.6 million ounces, representing a 9% growth. Revenue is expected to rise to $354 million. For 2027, revenue of $425 million is projected – based solely on the two producing mines in China – before a significant development leap is expected in fiscal year 2028 with the commissioning of the El Domo project in Ecuador. The integration of El Domo is expected to increase revenue in fiscal year 2028 (starting March 2027) to $614 million. This would significantly diversify the revenue distribution by metals and regions. While silver production in China is expected to contribute $270 million to revenue, copper production in Ecuador would generate $113 million for the first time. The gold and silver production from El Domo is expected to contribute a combined $211 million to revenue. Overall, the share of gold in the portfolio would significantly increase.
These forecasts are based on the ongoing production planning for the Chinese mines in fiscal year 2026, as well as a feasibility study for the El Domo project from 2021 – however, the metal prices assumed therein have been slightly adjusted to the current market environment: For copper, a price of $4.60/pound was set (currently $5.80; in the original study $3.50). Gold was calculated at $3,350 per ounce (currently $3,313; in the study $1,700) and silver at $33 per ounce (currently $38.16; in the study $23).
Figure 1: Silvercorp expects revenue to nearly double in the next two years due to the expansion into Ecuador.
Figure 2: The chart shows how cost-conscious Silvercorp has been in recent years. After the silver price correction in 2012, the company adjusted its cost structure (AISC) to consistently achieve stable margins.
Figure 3: Silvercorp achieved exceptionally high margins in recent years and performed significantly better than the industry average. In the last twelve months (TTM – Trailing Twelve Months), the EBITDA margin was 46%. Operating cash flow in 2025 was $138.6 million, capital expenditures were $86 million – resulting in a free cash flow of $52.6 million.
Figure 4: Silvercorp will significantly expand its resource base in the near future through expansion into Ecuador and organic growth.
Figure 5: Profitable silver mines in China support growth in Ecuador and beyond.
Conclusion:
From a Chinese perspective, Ecuador is a direct neighbor that is also easily accessible by sea across the Pacific. In addition to its rich raw material resources, this could be one of the reasons why Silvercorp is beginning its diversification strategy in this country. The rising export figures from Ecuador indicate favorable conditions that have now also attracted other renowned companies such as Lundin Gold (Fruta del Norte) and semi-state-owned Chinese companies such as Ecuacorriente S.A. (Mirador). Exports from the mining sector increased from $275 million in 2018 to $3.3 billion in 2023.
Silvercorp has a long track record of profitability and growth. The company relies heavily on free cash flow from long-life mines and organic growth through extensive exploration drilling. For comparison: In its Chinese projects alone, Silvercorp has drilled over 2,600 kilometers since its inception. For the current year, an additional 250,000 meters of drilling are planned. In China, a third silver mine is currently under construction, and another gold mine is in the permitting process.
Goldinvest.de looks forward to covering the company with reports and interviews on our channels in the future. The release of Q1 2026 quarterly results is scheduled for August 7.
