Sunshine Silver Mining & Refining Co 10-Q

Item 1. Financial Statements Sunshine Silver Mining & Refining Company Condensed Consolidated Balance Sheets Unaudited, expressed in United States Dollars UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS June 30, 2026 December 31, 2025 $ $ ASSETS Current assets Cash and cash equivalents 288,722,323 30,975,991 Prepaid expenses 878,628 1,282,034 Materials and supplies inventory 567,240 377,269 Other current assets 753,426 888,640 Total current assets 290,921,617 33,523,934 Restricted cash 275,039 275,039 Property, plant and equipment, net 44,392,824 34,290,542 Intangible assets 750,000 750,000 TOTAL ASSETS 336,339,480 68,839,515 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable 5,876,548 2,562,528 Accrued liabilities 5,753,925 2,218,413 Note payable 231,526 683,135 Total current liabilities 11,861,999 5,464,076 Reclamation obligations 1,873,574 1,814,600 TOTAL LIABILITIES 13,735,573 7,278,676 Commitments and contingencies (Note 11) STOCKHOLDERS’ EQUITY Preferred Stock, $ 0.001 par value, 250,000,000 shares authorized at June 30, 2026 and December 31, 2025, respectively; nil issued and outstanding at June 30, 2026 and December 31, 2025 — — Common stock, $ 0.001 par value, 3,500,000,000 and 150,000,000 shares authorized at June 30, 2026 and December 31, 2025, respectively; 143,726,603 and 116,509,480 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively 143,726 116,509 Additional paid-in capital 557,009,853 266,021,748 Accumulated deficit ( 234,549,672 ) ( 204,577,418 ) Total Stockholders’ Equity 322,603,907 61,560,839 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 336,339,480 68,839,515 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Condensed Consolidated Statements of Operations and Comprehensive Loss Unaudited, expressed in United States Dollars UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 $ $ $ $ Sales — 35,258 — 75,948 Operating expenses: Exploration — 71,062 — 71,062 Pre-Development 10,174,386 3,210,578 17,574,714 4,321,485 General and administrative 6,868,471 2,177,709 12,467,274 3,791,708 Depreciation and amortization 348,136 138,064 713,569 271,097 Cost of goods sold — 19,884 — 39,799 Accretion expense 29,487 27,687 58,974 55,375 Operating loss ( 17,420,480 ) ( 5,609,726 ) ( 30,814,531 ) ( 8,474,578 ) Other income (expense): Interest expense ( 6,425 ) ( 1,437,789 ) ( 16,622 ) ( 2,614,916 ) Interest income 706,141 2,596 858,899 4,292 Total other income (expense) 699,716 ( 1,435,193 ) 842,277 ( 2,610,624 ) Income and mining tax expense — — — — Net and comprehensive loss ( 16,720,764 ) ( 7,044,919 ) ( 29,972,254 ) ( 11,085,202 ) Basic and diluted loss per share of common stock ( 0.13 ) ( 0.08 ) ( 0.25 ) ( 0.13 ) Weighted average number of basic and diluted shares of common stock outstanding 123,986,712 85,439,630 120,268,751 85,439,630 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) Unaudited, expressed in United States Dollars UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) Common Stock Number of common shares Amount Additional Paid-in Capital Accumulated Deficit Total # $ $ $ $ Balance – December 31, 2025 116,509,480 116,509 266,021,748 ( 204,577,418 ) 61,560,839 Stock-based compensation — — 1,826,746 — 1,826,746 Net loss — — — ( 13,251,490 ) ( 13,251,490 ) Balance - March 31, 2026 116,509,480 116,509 267,848,494 ( 217,828,908 ) 50,136,095 Stock-based compensation — — 2,428,006 — 2,428,006 Issuance of common stock in connection with initial public offering, net of underwriting fees and offering costs 23,000,000 23,000 286,737,570 — 286,760,570 Issuance of common stock upon exercise of warrants 4,217,123 4,217 ( 4,217 ) — — Net loss — — — ( 16,720,764 ) ( 16,720,764 ) Balance – June 30, 2026 143,726,603 143,726 557,009,853 ( 234,549,672 ) 322,603,907 Common Stock Number of common shares Amount Additional Paid-in Capital Accumulated Deficit Total # $ $ $ $ Balance – December 31, 2024 85,439,630 85,440 152,402,938 ( 169,834,123 ) ( 17,345,745 ) Stock-based compensation — — 94,450 — 94,450 Net loss — — — ( 4,040,283 ) ( 4,040,283 ) Balance - March 31, 2025 85,439,630 85,440 152,497,388 ( 173,874,406 ) ( 21,291,578 ) Stock-based compensation — — 94,450 — 94,450 Net loss — — — ( 7,044,919 ) ( 7,044,919 ) Balance – June 30, 2025 85,439,630 85,440 152,591,838 ( 180,919,325 ) ( 28,242,047 ) The accompanying notes are an integral part of these condensed consolidated financial statements. 6 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Condensed Consolidated Statements of Cash Flows Unaudited, expressed in United States Dollars UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Six months ended June 30, 2026 2025 $ $ Cash Flows from Operating activities: Net loss ( 29,972,254 ) ( 11,085,202 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 713,569 271,097 Stock-based compensation 4,254,752 188,900 Reclamation obligation accretion 58,974 55,375 Convertible notes discount amortization — 914,889 Changes in operating assets and liabilities: Prepaid expenses 403,406 61,338 Materials and supplies inventory ( 189,971 ) ( 182,131 ) Metals inventory — 39,799 Other current assets ( 686,976 ) 1,631 Accounts payable 2,609,476 452,669 Accrued liabilities 1,092 396,758 Accrued interest — 1,688,312 Net cash used in operating activities ( 22,807,932 ) ( 7,196,565 ) Cash Flows from Investing activities: Additions to property, plant and equipment ( 9,453,812 ) ( 3,518,182 ) Additions to intangible assets — ( 750,000 ) Net cash used in investing activities ( 9,453,812 ) ( 4,268,182 ) Cash Flows from Financing activities Gross proceeds received from initial public offering 310,500,000 — Costs of initial public offering ( 20,040,315 ) — Payments of note payable for insurance premium financing ( 451,609 ) ( 271,469 ) Proceeds from notes payable — 17,600,000 Net cash provided by financing activities 290,008,076 17,328,531 Increase in Cash and cash equivalents and Restricted cash 257,746,332 5,863,784 Cash and cash equivalents and Restricted cash, beginning 31,251,030 2,242,885 Cash and cash equivalents and Restricted cash, ending 288,997,362 8,106,669 Supplemental Cash Flow Information: Interest paid 16,622 11,507 Unpaid offering costs 3,699,115 — The accompanying notes are an integral part of these condensed consolidated financial statements. 7 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated 1. BASIS OF PRESENTATION The interim condensed consolidated financial statements (“ Interim Financial Statements ”) of Sunshine Silver Mining & Refining Company, a Delaware corporation, and its subsidiaries (collectively, “ SSMR ,” “ we ,” “ us ,” or the “ Company ”) are unaudited. In the opinion of management, all normal recurring adjustments and disclosures necessary for a fair presentation of these Interim Financial Statements have been included. The results reported in these Interim Financial Statements are not necessarily indicative of the results that may be reported for the entire year. These Interim Financial Statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2025, as filed with the SEC on Form S-1. The year-end balance sheet data was derived from the audited financial statements and certain information and footnote disclosures required by GAAP have been condensed or omitted. These Interim Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and are expressed in U.S. Dollars. The Interim Financial Statements reflect the consolidation of SSMR and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. On May 10, 2026, the Company’s shareholders approved a 10 -for-1 split of its common stock. In connection with the stock split, the number of authorized shares of common stock was increased to 150,000,000 , while the par value per share remained unchanged at $ 0.001 . All share, per-share, warrants and stock options presented in these Interim Financial Statements reflect the 10 -for-1 stock split. On June 5, 2026, the Company completed its initial public offering (" IPO "). In connection with the IPO, the number of authorized shares of common stock and preferred stock was increased to 3,500,000,000 and 250,000,000 , respectively. The Company issued 23,000,000 shares of common stock at a public offering price of $ 13.50 per share, which resulted in proceeds of $ 291,870,000 after underwriting fees. Refer to Note 6 "Shareholders' Equity" for additional information. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 2.1 Liquidity and Capital Resources These Interim Financial Statements have been prepared on a going-concern basis under which the Company is considered to be able to realize its assets and satisfy its liabilities in the normal course of business. The Company has a history of operating losses and cash used in operations, which are expected to continue until profitable operations commence, and which are significant in relation to the Company’s ability to satisfy its liabilities in the normal course of business. On June 5, 2026, the Company completed its IPO. In connection with the IPO, the Company issued 23,000,000 shares of common stock at a public offering price of $ 13.50 per share, which resulted in proceeds of $ 291,870,000 after underwriting fees. Management evaluated the Company’s liquidity position, considering the net proceeds from the IPO alongside existing cash, cash equivalents, and anticipated operational cash flows. Based on this evaluation, management determined that these funds will be sufficient to satisfy the Company’s working capital requirements, capital expenditures, and debt obligations for at least 12 months from the issuance date of these Interim Financial Statements. 2.2 Risks and Uncertainties As a mining exploration and development company, the Company’s growth and future profitability depend significantly on the prevailing prices of minerals, primarily of silver. Commodity prices are historically volatile and mineral prices may fluctuate significantly in the future. A substantial or extended decline in mineral prices could have a material adverse effect on the Company’s financial position, results of operations, cash flows, and access to capital. The carrying value and recoverability of the Company’s investments are dependent on its ability to generate revenues from operations, which depends upon significant further financing to conduct exploration and development activities, demonstrate economic feasibility of the Sunshine Mine, construct mining infrastructure, and commence mining operations. A lack of access to capital may negatively impact the Company’s ability to commence mining operations. In addition to changes in mineral prices, other factors, such as: changes in exploration plans; increases in costs; geotechnical failures; changes in social, environmental, or regulatory requirements; and public health conditions 8 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated can adversely affect the Company’s ability to recover its investment in exploration and development assets, and could result in impairment charges. 2.3 Recent Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, which requires public business entities to provide disaggregated expense disclosures in the notes to the financial statements. The standard is effective for the Company beginning in fiscal year 2027, and the Company is currently assessing the impact of adoption. 3. FAIR VALUE MEASUREMENTS Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). At June 30, 2026 and December 31, 2025, the Company’s financial assets and liabilities consisted of: cash and cash equivalents, restricted cash, accounts payable, notes payable to finance insurance premiums, and accrued liabilities. The carrying amounts of these financial instruments approximated their fair values due to their short maturities. None of these financial instruments were measured at Level 3, and there were no transfers between fair value hierarchy levels during the six months ended June 30, 2026. 4. RELATED PARTY TRANSACTIONS On May 28, 2021, the Company entered into an agreement for strategic advisory services with a director, which was amended on October 24, 2022. During the three months ended June 30, 2026 and 2025, the Company incurred nil and $ 125,000 , respectively, for the provision of services under the agreement. During the six months ended June 30, 2026 and 2025, the Company incurred nil and $ 250,000 , respectively, for the provision of services under the agreement. The expenses incurred under the agreement are reported within 'General and administrative' expense on the consolidated statement of operations and comprehensive loss. At June 30, 2026 and December 31, 2025, nil and $ 41,667 , respectively, were payable by the Company to the director under this agreement. This agreement was terminated as of December 31, 2025. In 2025, the Company engaged the services of a related party, Scout Discoveries, for exploration and related services. The Company’s majority shareholder group owns 32 % of Scout Discoveries. During the three months ended June 30, 2026 and 2025, the Company incurred $ 381,273 and $ 40,610 , respectively, for the provision of services under the agreement. During the six months ended June 30, 2026 and 2025, the Company incurred $ 381,273 and $ 40,610 , respectively, for the provision of services under the agreement. The costs incurred under the agreement during the three and six months ended June 30, 2026 were incurred for the acquisition of mineral rights and were capitalized to 'Property, plant, and equipment, net'. The costs incurred under the agreement during the three and six months ended June 30, 2025 were recognized in 'Exploration' expense on the consolidated statement of operations and comprehensive loss. At June 30, 2026 and December 31, 2025, $ 381,273 and nil were due to or accrued for Scout Discoveries, respectively. Additional related party transactions are described at Notes 6 and 8. 9 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated 5. RECLAMATION OBLIGATIONS The Company recorded accretion expense on the condensed consolidated statements of operations and comprehensive loss related to the reclamation obligation of $ 58,974 and $ 55,375 during the six months ended June 30, 2026 and 2025, respectively. 6. SHAREHOLDERS' EQUITY 6.1 COMMON STOCK In connection with the IPO, the Company’s Third Amended and Restated Certificate of Incorporation became effective, which authorized capital stock consisting of 3,500,000,000 shares of common stock, par value $ 0.001 per share, and 250,000,000 shares of preferred stock, par value $ 0.001 per share. All outstanding shares of common stock are fully paid and non-assessable. The holders of common stock are entitled to one vote per share on all matters to be voted upon by the stockholders, except on matters relating solely to terms of preferred stock. We do not intend to pay any dividends in the foreseeable future and currently intend to retain all future earnings to finance our business. Subject to preferences that may be applicable to any outstanding preferred stock, the holders of common stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by our Board of Directors out of funds legally available therefor. In the event of liquidation, dissolution or winding up, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities, subject to prior distribution rights of preferred stock, if any, then outstanding. The holders of our common stock have no preemptive or conversion or exchange rights or other subscription rights. There are no redemption, retraction, purchase for cancellation, surrender or sinking or purchase fund provisions applicable to the common stock. As of June 30, 2026 and December 31, 2025, the Company had reserved shares of common stock for future issuance, on an as-converted basis, as follows: June 30, 2026 December 31, 2025 # # Restricted Stock Units 71,432 — Common Stock Warrants 9,375,000 14,729,700 Common Stock Options 8,323,000 8,573,000 Total 17,769,432 23,302,700 6.2 WARRANTS Warrants Weighted-average Exercise Price per Share Weighted-average Remaining Contractual Term # $/share Years Balance - December 31, 2024 5,354,700 $ 2.87 2.7 Balance - June 30, 2025 5,354,700 $ 2.87 2.2 Balance - December 31, 2025 14,729,700 $ 4.23 1.7 Automatic net exercise immediately prior to initial public offering ( 5,354,700 ) $ 2.87 Balance - June 30, 2026 9,375,000 $ 5.00 1.2 On April 29, 2026, the terms of the warrant held by Ospraie Real Assets Fund LP (" Ospraie ") to acquire 2,615,060 shares of the Company’s common stock and the terms of the warrant held by Electrum Silver US LLC (" ESUS ") to acquire 2,739,640 shares of the Company’s common stock, were amended. The warrants were amended to cause the automatic cashless exercise of the warrants upon an initial public offering of shares of the Company’s 10 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated common stock for all shares not previously exercised, if the fair market value per share exceeds the unmodified exercise price of $ 2.87 per share. Immediately prior to the completion of the IPO, the Company issued 2,157,618 shares of common stock to ESUS and 2,059,505 shares of common stock to Ospraie upon their automatic net exercises of these warrants. The automatic net exercise prices were paid by reductions of common shares issued. See Note 10 to the consolidated financial statements for the year ended December 31, 2025 for information about the terms of warrants. 7. LOSS PER SHARE The following table presents net loss per share of common stock – basic: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Numerator: Net loss ($ 16,720,764 ) ($ 7,044,919 ) ($ 29,972,254 ) ($ 11,085,202 ) Denominator: Weighted average number of basic shares of common stock 123,986,712 85,439,630 120,268,751 85,439,630 Basic and diluted loss per share of common stock ($ 0.13 ) ($ 0.08 ) ($ 0.25 ) ($ 0.13 ) The following were excluded from diluted loss per share because the Company incurred net losses and their effect would be anti-dilutive. Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 # # # # Common Stock Warrants 9,375,000 5,354,700 9,375,000 5,354,700 Common Stock Options 8,323,000 500,000 8,323,000 500,000 Restricted Stock Units 71,432 — 71,432 — Convertible Notes Payable and Accrued Interest Convertible for $ 2.87 per share — 12,295,515 — 12,295,515 Total 17,769,432 18,150,215 17,769,432 18,150,215 8. STOCK-BASED COMPENSATION Stock-based compensation expense includes vesting expense from stock options and restricted stock units (each, an " RSU "). During the three months ended June 30, 2026 and 2025, we recognized total stock-based compensation expense of $ 2,428,006 and $ 94,450 respectively. During the six months ended June 30, 2026 and 2025, we recognized total stock-based compensation expense of $ 4,254,752 and $ 188,900 , respectively. Stock options outstanding and their weighted-average exercise price at June 30, 2026 and 2025 were as follows: June 30, 2026 June 30, 2025 Stock Options Weighted- Average Exercise Price Weighted- Average Remaining Life Stock Options Weighted- Average Exercise Price Weighted- Average Remaining Life # $/share Years # $/share Years 8,323,000 $ 3.94 8.4 1,000,000 $ 4.57 5.9 8.1 Long Term Incentive Plan On May 10, 2026, the Board approved an amendment and restatement of the Amended and Restated 2021 LTIP (the " Amended and Restated LTIP ") which was originally adopted on May 28, 2021. As of the closing of the IPO, the maximum number of shares of common stock that may be issued under the Amended and Restated LTIP is 17,400,012 , subject to adjustment upon certain changes in the Company’s capitalization and annual increase on the first day of each calendar year during the term of the Amended and Restated LTIP, beginning on and including January 1, 2027, and ending on and including January 1, 2036, equal to the lesser of 2 % of the aggregate number of 11 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated shares of common stock issued and outstanding on December 31 of the immediately preceding calendar year and such smaller number of shares of common stock as determined by the administrator (the “ New LTIP Share Reserve ”). Shares of common stock issued under the Amended and Restated LTIP will consist of authorized and unissued or reacquired shares of common stock, including shares of common stock repurchased by the Company. The Amended and Restated LTIP provides for the grant of incentive stock options, nonqualified stock options, restricted stock, restricted stock units, stock appreciation rights, performance awards, deferred stock units and cash awards to eligible participants. No awards will be granted under the Amended and Restated LTIP following the tenth anniversary of the effective date of the Amended and Restated LTIP. 8.2 Stock Options No stock options were granted, exercised, expired, or cancelled during the six months ended June 30, 2026 and 2025. During the six months ended June 30, 2026 and 2025, 250,000 and no stock options were forfeited by former employees, respectively. During the six months ended June 30, 2026, the vesting period of 100,000 options of one grantee was modified from July 15, 2026 to April 6, 2026. The incremental fair value of the modification of vested options of $ 893,809 was expensed immediately. The inputs used to measure the modification were as follows: Black-Scholes Option Pricing Model Input Basis Inputs for Value of Modification Annualized volatility (%) Volatility of publicly traded peers 79.25 % Expected term (years) Award agreement 0.32 Dividend yield (%) No dividends over the expected term — % Risk-free rate (%) Risk-free U.S. Treasury yield over the expected term 3.73 % Exercise price ($/share) Award agreement $ 4.00 Common stock price ($/share) Initial public offering price $ 13.50 The Company recognized stock-based compensation expense from stock options as follows: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 $ $ $ $ Pre-development expense 186,937 — 391,177 — General and administrative expense 2,157,732 94,450 3,780,238 188,900 2,344,669 94,450 4,171,415 188,900 At June 30 2026 and 2025, unrecognized compensation expense for stock options was $ 12,613,370 and $ 342,090 , respectively. 8.3 Restricted Stock Units On June 5, 2026, eight non-employee Directors were awarded an aggregate of 71,432 RSUs with a grant date fair value of $ 14.00 per RSU as their 2026 annual grant under the Non-Employee Director Compensation Program. The RSUs vest on the earlier of one year from the grant date or the day immediately preceding the date of the next Annual Meeting of Stockholders. Under the terms of the Non-Employee Director Compensation Program, each non-employee director is entitled to receive an annual grant of RSUs with respect to a number of shares equal to $ 125,000 (based on the closing price of a share of common stock on the date of grant). No RSUs had been previously awarded. The Company recognized stock-based compensation expense from RSUs of $ 83,337 and nil for the three and six months ended June 30, 2026 and 2025, respectively. 12 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated 9. SALES There were no silver sales during the six months ended June 30, 2026. During the six months ended June 30, 2025, the Company sold 1,303 ounces of silver from metals inventory, which generated sales of $ 75,948 and costs of goods sold of $ 39,799 . The metals inventory was from previous mining activity prior to the Sunshine Mine ceasing operations in 2001. 10. INCOME AND MINING TAXES The Company estimates that its 2026 effective tax rate will be 0 % due to its cumulative loss position, historical net operating losses, and other available evidence related to the Company's ability to generate taxable income. Accordingly, there is no income tax provision or benefit for any period presented. A reconciliation of the actual income tax benefit and the tax computed by applying the applicable U.S. income tax rate (21%) to the loss before income taxes is as follows: Three months ended June 30, 2026 2025 $ % of Pretax Loss $ % of Pretax Loss Tax provision (benefit) ( 3,511,360 ) 21.0 % ( 1,479,433 ) 21.0 % State tax (benefit) ( 699,856 ) 4.2 % ( 317,021 ) 4.5 % Other 788,460 ( 4.7 %) 116,822 ( 1.7 %) Change in valuation allowance 3,422,756 ( 20.5 %) 1,679,632 ( 23.8 %) Total income tax expense (benefit) — — % — — % Six months ended June 30, 2026 2025 $ % of Pretax Loss $ % of Pretax Loss Tax provision (benefit) ( 6,294,173 ) 21.0 % ( 2,327,892 ) 21.0 % State tax (benefit) ( 1,254,503 ) 4.2 % ( 498,834 ) 4.5 % Other 869,093 ( 2.9 %) 132,027 ( 1.2 %) Change in valuation allowance 6,679,583 ( 22.3 %) 2,694,699 ( 24.3 %) Total income tax expense (benefit) — — % — — % Included in Other are permanent differences, including those related to non-deductible stock option expense. 11. BUSINESS SEGMENTS The Company is organized into one operating segment, which conducts exploration and development of mineral properties and thus has identified one reportable segment: Exploration and Development. The Company regularly reviews its segment reporting for alignment with its strategic goals and operational structure as well as for evaluation of business performance and allocation of resources by the Company’s Chief Operating Decision Maker (“CODM”). 13 TABLE OF CONTENTS Sunshine Silver Mining & Refining Company Notes to the Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2026 and 2025 Unaudited, expressed in United States Dollars, unless otherwise indicated The following table summarizes the components and significant expenses of the measure of net loss: Three Months Ended June 30, Six Months Ended June 30, 2026 2026 2025 2026 2025 $ $ $ $ Pre-Development: Labor and contractor services 7,692,220 1,443,776 12,230,131 1,946,034 Materials and other directly related costs 2,296,523 1,657,119 5,081,517 2,251,891 Other 185,643 109,683 263,066 123,560 Total Pre-Development 10,174,386 3,210,578 17,574,714 4,321,485 General and Administrative Labor and contractor services 5,353,197 1,001,700 9,060,458 1,865,566 Other 1,515,274 1,176,009 3,406,816 1,926,142 Total General and Administrative 6,868,471 2,177,709 12,467,274 3,791,708 12. COMMITMENTS AND CONTINGENCIES The Company owes contingent consideration of $ 150,000 upon use of intellectual property in its planned silver refinery. The Company has no other material commitments or contingencies outside of those disclosed in these financial statements and the consolidated financial statements for the year ended December 31, 2025. 13. SUBSEQUENT EVENTS The Company evaluated events after June 30, 2026, and through the date the Interim Financial Statements were issued. The Company has concluded that no subsequent events have occurred that require disclosure, except as otherwise disclosed in the Interim Financial Statements. 14 TABLE OF CONTENTS