MD&A

Extracted Document Text

This is a readable excerpt of the EGM normalized Markdown text. It helps search engines and researchers understand PDF, filing, or company-document content while the original source remains authoritative.

# MD&A

Source: https://ayagoldsilver.com/_resources/financials/2026/Q2-2026-Aya-Gold-Silver-Inc-MD-A.pdf
Published: 2026-08-13T20:31:02+00:00
Fetched: 2026-08-13T20:47:20.011+00:00
Source artifact: b8bd9cff-d07e-40b3-bf1d-df446e898a7b
Normalizer input: text

## Content

Management’s Discussion and Analysis of Financial
Condition and Results of Operations
This Management’s Discussion and Analysis (“MD&A”) of the operations, results, and financial position of Aya Gold & Silver
Inc. (the “Corporation” or "Aya"), dated August 13, 2026, covers the three-month ("Q2-2026" or the "Quarter") and six-month
periods ("H1-2026") ended June 30, 2026. This MD&A is prepared by management and should be read in conjunction with the
Corporation’s Unaudited Condensed Interim Consolidated Financial Statements (“FS”) and related notes for the three and six-
month periods ended June 30, 2026. The Corporation uses certain non-GAAP financial measures in this MD&A as described
under “Non-GAAP Measures".
The Corporation’s June 30, 2026, FS and the related financial information contained in this MD&A have been prepared in
accordance with International Accounting Standard 34, "Interim Financial Reporting" of the International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), unless otherwise stated. All amounts
are stated in thousands of United States dollars (“US”), except for share and per share amounts, or unless otherwise indicated.
References to “C$” are to the Canadian dollar while “MAD” refers to the Moroccan Dirham.
This MD&A contains forward-looking information that is subject to risk factors set out in a cautionary note in this MD&A under
“Cautionary Note Regarding Forward-Looking Information”. All information contained in the FS and this MD&A has been
reviewed by the Audit Committee and approved by the Corporation’s Board of Directors. This MD&A is current as of August 13,
2026, unless otherwise stated.
AYA GOLD & SILVER INC. / MANAGEMENT’S DISCUSSION AND ANALYSIS / Q2-2026 2
Contents
Business Overview 4
Q2-2026 and H1-2026 Operational Highlights 6
Q2-2026 and H1-2026 Financial Highlights 7
Silver Equivalent Production Chart 10
Recent Developments 10
Operating Results 11
Development and Exploration 12
Overview of Financial Performance 14
Summary of Quarterly Results 16
Liquidity and Capital Resources 18
Financial Position 20
Capital Management 21
Commitments and Contingency 22
Non-GAAP Measures 23
Risks and Uncertainties 25
Other Financial Information 26
Accounting Policies, Judgements and Estimates 27
Management’s Report on Internal Controls and Financial Reporting 27
Additional Information and Continuous Disclosure 28
Technical Information 28
Cautionary Note to United States Investors Concerning Estimates of Mineral Reserves and Resources 28
Cautionary Note Regarding Forward-Looking Information 29
AYA GOLD & SILVER INC. / MANAGEMENT’S DISCUSSION AND ANALYSIS / Q2-2026 3
Business Overview
General Information
Aya is a Canadian-based precious metals mining corporation active across the full mining lifecycle; from discovery and
development through to production. The Corporation operates in Morocco.
Aya’s flagship asset is the Zgounder Silver Mine, recognized for its rare, high-grade silver mineralization. The mine is located
along the Anti-Atlas fault, one of North Africa’s most geologically rich and underexplored regions, known for hosting world-
class silver, gold, and base metal deposits. Aya also owns an 85% interest in the Boumadine polymetallic project, which is
currently at the exploration and evaluation stage, with an Updated Preliminary Economic Assessment ("Updated PEA") and
feasibility study underway.
Aya is incorporated under the Canada Business Corporations Act; its financial year-end is December 31, and its common
shares trade on the Toronto Stock Exchange and the Nasdaq Stock Market under the symbol “AYA”. Aya’s issued and
outstanding share capital totals 144,036,168 common shares on August 13, 2026.
Geographic Overview
• The Zgounder mining permit covers 16 km². 23 Mining and exploration permits within the Zgounder Regional area
encompass an additional 362 km2, bringing the total land package at and around Zgounder to 378 km².
• Boumadine's exploration portfolio includes 31 permits and licenses covering 341 km², including a 32 km² mining
exploitation license. The project also benefits from an additional 600 km² of exploration authorizations.
For details and history of permitting please refer to the Corporation's latest Annual Information Form available on SEDAR+ and
EDGAR.
AYA GOLD & SILVER INC. / MANAGEMENT’S DISCUSSION AND ANALYSIS / Q2-2026 4
Zgounder Silver Mine
Located in Morocco’s central Anti-Atlas Mountains, the wholly owned Zgounder Silver Mine is a rare, silver-only operation. The
mine is supported by proven and probable mineral reserves of 73 million ounces (“Moz”) of silver.
Commercial Operations
Following a major expansion completed in 2024, the Zgounder Silver Mine achieved commercial production on December 29,
2024, completed its ramp-up during 2025, and continues to optimize its operations in 2026. The updated mine plan released in
Q4-2025 extends the operation’s life to 2036, supporting an average annual production profile of approximately 6 Moz of silver
over the life of mine (“LOM”). The orebody is mined using a combination of open-pit and underground mining methods. The
expansion included new mine development, plant, tailings, water storage facilities, and infrastructure improvements. Silver is
produced through cyanide leaching and refined into doré bars. All of the revenue from the Zgounder Silver Mine is derived from
the production and sale of silver, sold on a regular basis at prevailing market prices.
Near-Mine and Regional Exploration
Exploration is a core part of Aya’s growth strategy, focused on expanding its resource base, advancing priority targets, testing
new prospective zones, and enhancing overall geological understanding of the project area. The 2026 exploration program is
targeting 30,000 metres of Diamond Drill Holes ("DDH").
Technical Report and Mineral Reserves and Resources
An updated National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") technical report titled
“Updated Mineral Resource and Mineral Reserves Estimate of the Zgounder Silver Mine Operation, Kingdom of Morocco” was
released on December 16, 2025 (the "Zgounder Report"). The Zgounder Report is based on a Mineral Resource Estimate for
Zgounder as of June 30, 2025, and a Mineral Reserve Estimate as of September 30, 2025. Additional details are provided in the
"Development and Exploration" section.
Boumadine Polymetallic Project ("Boumadine Project")
Located in the Anti-Atlas region of eastern Morocco, Boumadine is a polymetallic gold-silver-zinc-lead system owned 85% by
Aya and 15% by National Office of Hydrocarbons and Mines ("ONHYM"). The Boumadine Project is Aya’s most advanced
development-stage asset and a key pillar of its long-term growth strategy in Morocco. The project hosts a significant mineral
resource and a sizable mineralized footprint, with ongoing exploration and resource expansion drilling. The Boumadine
Preliminary Economic Assessment ("2025 PEA" - See "Technical Report and Mineral Resource Estimate" subsection)
contemplates a combined open-pit and underground mining operation with a processing capacity of approximately 2.9 million
tonnes per year. The Boumadine Project is expected to produce three marketable concentrates (zinc, lead, and pyrite), with
revenue largely derived from precious metals. Boumadine benefits from year-round access and existing regional infrastructure,
which would require enhancements to support full-scale operations. Feasibility study activities are currently underway to
advance development planning and optimize the project’s economics.
Aya initiated the reclaiming and commercialization of a historical pyrite stockpile at Boumadine in Q4-2025. This legacy
flotation by-product contains approximately 2.30 g/t Au and 144 g/t Ag and is expected to yield approximately 2.5 million
silver-equivalent ounces. Announced on November 19, 2025, the initiative is expected to last approximately 20 to 24 months
from that date. The program is designed to generate near-term cash flow, demonstrate the marketability of Boumadine’s gold-
and silver-rich pyrite concentrate, and align with Aya’s commitment to responsible environmental management.
Exploration
Since 2022, Aya has completed 444,039 metres ("m") of drilling at Boumadine, significantly advancing the geological model.
The 2026 exploration program is targeting 200,000 m, including infill drilling (180,000 m – representing half of the planned
two-year 360,000 m program) to convert inferred resources to the indicated and measured categories, as well as expanding
the resource at depth and along strike. The program also includes 20,000 m of regional exploration drilling on new targets and
to follow-up on the Asirem structures discovered in 2025.
Technical Report and Mineral Resource Estimate
The 2025 PEA titled "Preliminary Economic Assessmement for Boumadine Polymetallic Project, Kingdom of Morocco" is a NI
43-101 technical report (effective date November 4, 2025; filed on SEDAR+ on December 18, 2025), and is based on a Mineral
Resource Estimate for Boumadine as of February 24, 2025.
AYA GOLD & SILVER INC. / MANAGEMENT’S DISCUSSION AND ANALYSIS / Q2-2026 5
Q2-2026 and H1-2026 Operational Highlights
Change Change YTD YTD Change
Q2-2026 Q1-2026 Q2 vs Q1 Q2-2025 Q2 vs Q2 2026 2025 YTD
Zgounder
Ore Mined (tonnes) 444,106 411,766 8% 241,288 84% 855,872 435,949 96%
Average Grade Mined (g/t Ag) 137 135 1% 138 (1)% 136 144 (6)%
Ore Processed (tonnes) 353,888 326,949 8% 273,471 29% 680,837 523,214 30%
Average Grade Processed (g/t Ag) 141 140 1% 140 1% 141 151 (7)%
Combined Mill Recovery (%) 91.2% 89.4% 1.8% 86.5% 4.7% 90.3% 84.4% 5.9%
Milling Operations (tpd) 3,889 3,633 7% 3,005 29% 3,762 2,891 30%
Silver Produced (oz) 1,489,526 1,265,012 18% 1,042,317 43% 2,754,538 2,110,970 30%
Silver Sold (oz) (A) 1,322,585 1,375,930 (4)% 1,140,452 16% 2,698,515 2,202,017 23%
Cash Costs per Silver Ounce Sold1 17.69 18.64 (5)% 21.26 (17)% 18.18 20.14 (10)%
Production Costs per Tonne 55.61 65.89 (16)% 82.41 (33)% 60.55 78.16 (23)%
Processed1
Average Net Realized Silver Price 68.29 83.42 (18)% 33.86 102% 76.00 32.90 131%
($/oz) (D/A)
Boumadine Reclaim Operations
Ore Processed (tonnes) 17,153 21,814 (21)% - NM 38,967 - NM
Average Grade Processed (g/t Ag) 179 181 (1)% - NM 180 - NM
Average Grade Processed (g/t Au) 2.43 2.50 (3)% - NM 2.47 - NM
Silver Produced (oz) 100,721 127,406 (21)% - NM 228,127 - NM
Gold Produced (oz) 1,414 1,757 (20)% - NM 3,171 - NM
Silver Equivalent Produced (oz) 187,784 227,802 (18)% - NM 415,586 - NM
Silver Equivalent Sold (oz) (B) 184,536 50,431 266% - NM 234,967 - NM
Cash Costs per Silver Equivalent 10.58 11.86 (11)% - NM 10.85 - NM
Ounce Sold1,2
Average Net Realized Silver 35.08 49.57 (29)% - NM 38.19 - NM
Equivalent Price ($/oz) (E/B)
Consolidated Operations
Silver Equivalent Produced 1,677,310 1,492,814 12% 1,042,317 61% 3,170,124 2,110,970 50%
Consolidated (oz)
Silver Equivalent Sold 1,507,121 1,426,361 6% 1,140,452 32% 2,933,482 2,202,017 33%
Consolidated (oz) (C)
Average Net Realized Silver 64.22 82.22 (22)% 33.86 90% 72.97 32.90 122%
Equivalent Price ($/oz) (C/F)
Cash Costs per Silver Equivalent 16.82 18.40 (9)% 21.26 (21)% 17.59 20.14 (13)%
Ounce Sold1,2
NM – Not Meaningful
1 Non-GAAP Measures, refer to page 23.
2 Cash costs per AgEq ounce sold at Boumadine were negatively impacted by changes in the gold-to-silver ratio during the quarter. As commodity prices increased,
the gold-to-silver ratio compressed, reducing reported AgEq ounces and increasing unit costs on an AgEq basis. The Corporation’s AgEq ounces for 2026 guidance at
Boumadine are calculated using an 80:1 Au:Ag ratio and assumed commodity p

[Excerpt trimmed for readability. Open the original source for the complete filing or document.]