ARG:CC - Amerigo Announces 2022 Results & Quarterly Dividend

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2022 net income of$4.4 million, adjusted net income of $15.9 million

AnnualEBITDA ¹ of $48.7 million - $28.0 millionreturned to shareholders in 2022

Quarterly dividend of Cdn$0.03 per sharedeclared, representing a 9.09% yield ²

Amerigo Resources Ltd. (TSX: ARG; OTCQX: ARREF) (“Amerigo” or the “Company”) is pleased to announcefinancial results for the year and three months(“Q4-2022”) endedDecember 31, 2022. Dollar amounts in this news release are in U.S.dollars unless indicated otherwise.

Amerigo’s annualfinancial results included net income of $4.4 million, earnings pershare (“EPS”) of $0.03, EBITDA[1]of $48.7 million, and free cashflow to equity ¹ of $17.1 million. Excluding an $11.5million equipment write-down recorded during 2022, the annual adjustednet income was $15.9 million. The write-down had no impact on the 2022cash flow.

Amerigo returned $28.0 million to shareholdersduring the year. Cash and restricted cash on December 31, 2022, was$42.0 million, compared to starting 2022 cash and restricted cash of$64.0 million.

“We are pleased to report 2022 financial results.Our stable operations have now outperformed production guidance ineach of the last three years, and Amerigo successfully weathered lowercopper prices to generate strong operating cash flow of $34.9 milliondollars,” said Aurora Davidson, Amerigo’s President and CEO.“Last year, we returned $28.0 million to shareholders and reducedbank debt by $7.0 million. With copper prices rebounding at the end of2022, we look forward to a strong year during which we believe we can,for the first time, deploy all the tools available in Amerigo’spowerful capital return strategy. We are off to an excellent start,having initiated share repurchases in January under our second annualNormal Course Issuer Bid share buyback program, and announcing todayanother quarterly dividend,” she added.

Q4-2022 financialresults included a net loss of $1.6 million, loss per share(“LPS”) of $0.01, EBITDA ¹ of $14.1 million, and freecash flow to equity ¹ of $9.2 million. Adjusted net incomeexcluding the $11.5 million equipment write-down recorded in thequarter was $9.9 million. Q4-2022 financial results included $4.8million in positive settlement adjustments to copper revenue, of which$2.1 million were final adjustments.

On February 21, 2023,Amerigo’s Board of Directors declared a quarterly dividend ofCdn$0.03 per share, payable on March 20, 2023, to shareholders ofrecord as of March 6, 2023 ³ . Amerigo designates the entireamount of this taxable dividend to be an “eligible dividend” forpurposes of the Income Tax Act (Canada), as amended from timeto time. Based on Amerigo’s December 31, 2022, share closing priceof Cdn$1.32, this represents an annual dividend yield of9.09% ² .

This news release should be read inconjunction with Amerigo’s audited consolidated financial statementsand Management’s Discussion and Analysis (“MD&A) for the yearsended December 31, 2022 and 2021 available on the Company’s websiteat www.amerigoresources.com and at www.sedar.com

¹ This is a non-IFRS measure. See “Non-IFRSMeasures” for further information

Highlights andSignificant Items

• Lower copper market prices starting inmid-2022 affected Amerigo’s financial performance. The Company’sannual average copper price was $4.01 per pound (“/lb”), down from$4.25/lb in 2021, resulting in lower copper revenue before notionalcharges of $33.3 million, despite higher copperproduction.

• 2022 net income was further impacted by a $11.5 millionequipment write-down for the 2025 retirement of two power generatorsthat the Company determined to be obsolete during the year. Thewrite-down is a non-cash event, with no impact on the Company’s 2022cash flow.

• 2022 net incomewas $4.4 million (2021: $39.8 million). 2022 net income, excluding thegenerators write-down, was $15.9 million.

• Annual earnings per share (“EPS”) was $0.03 (Cdn$0.03)(2021: $0.22 (Cdn$0.28)).

• 2022 copper production was 64.0 millionpounds (“M lbs”) (2021: 63.4 M lbs), including 37.7 M lbs fromfresh tailings (2021: 32.3 M lbs) and 26.3 M lbs from Cauqueneshistorical tailings (2021: 31.1 M lbs).

• 2022 molybdenumproduction was 1.0 M lbs (2021: 1.3 M lbs) due to lower molybdenumcontent in fresh tailings.

• 2022 revenue was $168.1 million (2021: $199.6million), including copper tolling revenue of $153.0 million (2021:$181.4 million) and molybdenum revenue of $15.1 million (2021: $18.1million).

• Copper tollingrevenue is calculated from the gross value of copper produced in 2022of $255.4 million (2021: $269.4 million) and negative fair valueadjustments to settlement receivables of $6.2 million (2021: positiveadjustments of $13.1 million), less notional items including DETroyalties of $70.5 million (2021: $78.4 million), smelting andrefining of $24.0 million (2021: $20.6 million) and transportation of$1.7 million (2021: $2.0 million).

¹ This is a non-IFRS measure.See “Non-IFRS Measures” for further information

• TheCompany generated annual operating cash flow before changes innon-cash working capital ¹ of $34.9 million (2021: $69.5million). Annual net operating cash flow was $23.6 million (2021:$93.8 million). Free cash flow to equity ¹ was $17.1 million(2021: $32.3 million).

• 2022 cash cost ¹ was $1.98/lbincluding $0.04/lb paid to the Company’s Chilean plant workers inQ4-2022 as the signing bonus of a 3-year collective labour agreement.Normalized cash cost ¹ excluding the effect of the signingbonus was $1.94/lb (2021: $1.75/lb). The main drivers of the increasein cash cost ¹ were lower molybdenum by-product credits($0.05/lb) and an increase in industry benchmark treatment andrefinery charges ($0.04/lb).

• Amerigo’s financial performance is sensitive tochanges in copper prices. The Company’s year-end provisional copperprice was $3.80/lb ⁴ and final prices for October, November,and December 2022 sales will be the average London Metal Exchange(“LME”) prices for January, February, and March 2023 respectively.A 10% increase or decrease from the $3.80/lb ⁴ provisionalprice used on December 31, 2022, would result in a $6.4 million changein revenue in Q1-2023 in respect of Q4-2022 production.

• During 2022, Amerigoreturned $28.0 million to shareholders (2021: $11.7 million),including $15.7 million (2021: $2.8 million) through Amerigo’sregular quarterly dividend of Cdn$0.03 per share, and $12.3 millionused to purchase for cancellation 9.4 million common shares (2021:$8.8 million used to purchase for cancellation 8.5 million commonshares).

• In 2022, net debt repayments were $7.0 million (2021: $24.0million). The Company’s borrowings at year end were $23.7 million(December 31, 2021: $30.4 million). Amerigo’s debt level is now atits lowest since Q1-2015.

• On December 31, 2022, Amerigo held cash and cash equivalents of $37.8million (December 31, 2021: $59.8 million), a restricted cash balanceof $4.2 million (December 31, 2021: $4.2 million) and had workingcapital of $10.0 million (December 31, 2021: $24.6million)

Investor ConferenceCall on February 23, 2023

Amerigo’s quarterly investorconference call will take place on Thursday, February 23, 2023 at11:00 am Pacific Standard Time/2:00 pm Eastern Standard Time.

Participants can join by going to https://bit.ly/3FICjYa andentering their name and phone number. The conference system will thencall the participants and place them instantly into the call.

Alternatively, participants can dial direct to beentered to the call by an Operator. Dial 1-888-664-6392 (Toll-FreeNorth America) and enter confirmation number 84336703 .

About Amerigo and MineraValle Central (“MVC”)

AmerigoResources Ltd. is an innovative copper producer with a long-termrelationship with Corporación Nacional del Cobre de Chile(“Codelco”), the world’s largest copper producer.

Amerigo produces copper concentrate and molybdenum concentrate as aby-product at the MVC operation in Chile by processing fresh andhistoric tailings from Codelco’s El Teniente mine, the world'slargest underground copper mine. Tel: (604) 681-2802; Web: www.amerigoresources.com ;ARG:TSX; OTCQX: ARREF

¹ This is a non-IFRS measure. See“Non-IFRS Measures” for further information

1 Non-IFRS Measures

This news release includes fivenon-IFRS measures: (i) EBITDA, (ii) operating cash flow before changesin non-cash working capital, (iii) free cash flow to equity(“FCFE”), (iv) free cash flow (“FCF”) and (v) cash cost.

Thesenon-IFRS performance measures are included in this news releasebecause they provide key performance measures used by management tomonitor operating performance, assess corporate performance, and toplan and assess the overall effectiveness and efficiency ofAmerigo’s operations. These performance measures are notstandardized financial measures under IFRS and, therefore, amountspresented may not be comparable to similar financial measuresdisclosed by other companies. These performance measures should not beconsidered in isolation as a substitute for measures of performance inaccordance with IFRS.

(i) EBITDA refers to earnings before interest,taxes, depreciation, and administration and is calculated by addingback depreciation expense to the Company’s gross profit.

(ii) Operating cash flow before changes innon-cash working capital is calculated by adding back the decrease orsubtracting the increase in changes in non-cash working capital to orfrom cash provided by operating activities.

(iii) Free cash flowto equity (“FCFE”) refers to operating cash flow before changes innon-cash working capital less capital expenditures plus new debtissued less debt and lease repayments. FCFE represents the amount ofcash generated by the Company in a reporting period that can be usedto pay for:

a) potential distributions to the Company’sshareholders, and

b) any additional taxes triggered by therepatriation of funds from Chile to Canada to fund thesedistributions.

Free cash flow (“FCF”) refers to FCFE plusrepayments of borrowings and lease repayments.

(iv) Cash cost is a performance measure commonlyused in the mining industry that is not defined under IFRS. Cash costis the aggregate of smelting and refining charges, tolling/productioncosts net of inventory adjustments and administration costs, net ofby-product credits. Cash cost per pound produced is based on pounds ofcopper produced and is calculated by dividing cash cost over thenumber of pounds of copper produced.

2 Dividend yield

The disclosed annual yield of 9.09% is based onfour quarterly dividends of Cdn$0.03 per share each, divided overAmerigo’s December 31, 2022 closing share price of Cdn$1.32.

3 Dividenddates

A dividend of Cdn$0.03 pershare will be paid on March 20, 2023 to shareholders of record as ofMarch 6, 2023. Accordingly, the ex-dividend date will be March 5,2023. Shareholders purchasing Amerigo shares on the ex-dividend dateor after will not receive this dividend, as it will be paid to sellingshareholders. Shareholders purchasing Amerigo shares prior to theex-dividend date will receive the dividend.

4 MVC’s copperprice

MVC’scopper price is the average notional copper price for the period,before smelting and refining, DET notional copper royalties,transportation costs and excluding settlement adjustments to priorperiod sales.

MVC’s pricing terms are based on the average LME copper pricefor the third month following delivery of copper concentrates producedunder the tolling agreement with DET (“M+3”). This means that whenfinal copper prices are not yet known, they are provisionallymarked-to-market at the end of each month based on the progression ofthe LME published average monthly M and M+3 prices. Provisional pricesare adjusted monthly using this consistent methodology, until they aresettled.

Q3-2022copper deliveries were marked-to-market at September 30, 2022 at$3.50/lb and were settled in Q4-2022 as follows:

• July 2022 salessettled at the October 2022 LME average price of$3.46/lb

• August 2022 salessettled at the November 2022 LME average price of$3.64/lb

• September 2022 sales settled at the December2022 LME average price of $3.79/lb

Q4-2022 copper deliveries weremarked-to-market at December 31, 2022 at $3.80/lb and will be settledat the LME average prices for January ($4.08/lb), February and March2023.

Cautionary Statement onForward-Looking Information

This news release contains certainforward-looking information and statements as defined in applicablesecurities laws (collectively referred to as "forward-lookingstatements"). These statements relate to future events or theCompany’s future performance. All statements other than statementsof historical fact are forward-looking statements. The use of any ofthe words "anticipate", "plan", "continue","estimate", "expect", "may", "will","project", "predict", "potential","should", "believe" and similar expressions isintended to identify forward-looking statements. These forward-lookingstatements include but are not limited to, statementsconcerning:

• forecasted production and operatingcosts;

• our strategies andobjectives;

• ourcapital return strategy, including our dividendpolicy;

• ourestimates of the availability and quantity of tailings, and thequality of our mine planestimates;

• the sufficiency of MVC’s water reservesto maintain projected Cauquenes tonnage processing for a period of atleast 18 months;

• pricesand price volatility for copper, molybdenum and other commodities andof materials we use in our operations;

• the demand for and supply of copper,molybdenum and other commodities and materials that we produce, selland use;

• sensitivity of our financial results and share price to changesin commodity prices;

• our financial resources and financial condition and our expectedability to redeploy other tools of our capital returnstrategy;

• interest and otherexpenses;

• domestic and foreign laws affectingour operations;

• our tax position and the tax ratesapplicable to us;

• our ability to comply with ourloan covenants;

• the production capacity of ouroperations, our planned production levels and future production;

• potential impact of production andtransportation disruptions;

• hazards inherent in themining industry causing personal injury or loss of life, severe damageto or destruction of property and equipment, pollution orenvironmental damage, claims by third parties and suspension ofoperations

• estimates of asset retirementobligations and other costs related to environmentalprotection;

• our future capital and productioncosts,including the costs and potential impact of complying withexisting and proposed environmental laws and regulations in theoperation and closure of our operations;

• repudiation, nullification, modification or renegotiation ofcontracts;

• our financial and operatingobjectives;

• our environmental, health and safetyinitiatives;

• the outcome of legal proceedings andother disputes in which we may be involved;

• theoutcome of negotiations concerning metal sales, treatment charges androyalties;

• disruptions to the Company'sinformation technology systems, including those related tocybersecurity; and

• general business and economicconditions, including, but not limited to, our assessment of strongmarket fundamentals supporting copper prices.

These forward-lookingstatements involve known and unknown risks, uncertainties and otherfactors that may cause actual results or events to differ materiallyfrom those anticipated in such statements. Inherent in forward-lookingstatements are risks and uncertainties beyond our ability to predictor control, including risks that may affect our operating or capitalplans; risks generally encountered in the permitting and developmentof mineral projects such as unusual or unexpected geologicalformations, negotiations with government and other third parties,unanticipated metallurgical difficulties, delays associated withpermits, approvals and permit appeals,ground control problems,adverseweather conditions, process upsets and equipment malfunctions; risksassociated with labour disturbances and availability of skilled labourand management; risks related to the potential impact of global ornational health concerns, including COVID-19, and the inability ofemployees to access sufficient healthcare; government or regulatoryactions or inactions; fluctuations in the market prices of ourprincipal commodities, whichare cyclical and subject to substantialprice fluctuations; riskscreated through competition for miningprojectsand properties; risks associated with lack of access tomarkets; risks associated with availability of and our ability toobtain both tailings from Codelco’s Division El Teniente’s currentproduction and historic tailings from tailings deposit; theavailability of and ability of the Company to obtain adequate fundingon reasonable terms for expansions and acquisitions; mine planestimates; risks posed by fluctuations in exchange rates and interestrates, as well as general economic conditions; risks associated withenvironmental compliance and changes in environmental legislation andregulation; risks associated with our dependence on third parties forthe provision of critical services; risks associated withnon-performance by contractual counterparties; risks associated withsupply chain disruptions; title risks; social and political risksassociated with operations in foreign countries; risks of changesinlaws affecting our operations or their interpretation, includingforeign exchange controls; and risks associated with tax reassessmentsand legal proceedings. Notwithstanding the efforts of the Company andMVC, there can be no guarantee that the Company’s or MVC’s staffwill not contract COVID-19 or that the Company’s and MVC’smeasures to protect staff from COVID-19 will be effective. Many ofthese risks and uncertainties apply not only to the Company and itsoperations, but also to Codelco and its operations. Codelco’songoing mining operations provide a significant portion of thematerials the Company processes and its resulting metals production,therefore these risks and uncertainties may also affect theiroperations and in turn have a material effect on the Company.

Actual resultsand developments are likely to differ, and may differmaterially, fromthose expressed or implied by the forward-looking statements containedin this news release. Such statements are based on several assumptionswhich may prove to be incorrect, including, but not limited to,assumptions about:

• general business and economicconditions;

• interest and currency exchange rates;

• changes in commodityand power prices;

• acts of foreign governments and the outcome oflegal proceedings;

• the supply and demand for, deliveries of, and thelevel and volatility of prices of copper, molybdenum and othercommodities and products used in our operations;

• the ongoing supply ofmaterial for processing from Codelco’s current miningoperations;

• the grade and projected recoveries of tailings processed byMVC;

• theability of the Company to profitably extract and process material fromthe Cauquenes tailings deposit;

• the timing of the receipt of andretention of permits and other regulatory and governmentalapprovals;

• our costs of production and our production and productivitylevels, as well as those of our competitors;

• changes in creditmarket conditions and conditions in financial marketsgenerally;

• our ability to procure equipment and operating supplies insufficient quantities and on a timely basis;

• the availability ofqualified employees and contractors for our operations;

• our ability to attractand retain skilled staff;

• the satisfactory negotiation of collectiveagreements with unionized employees;

• the impact of changes in foreign exchangerates and capital repatriation on our costs andresults;

• engineering and construction timetables and capital costs forour expansion projects;

• costs of closure of variousoperations;

• market competition;

• tax benefits and tax rates;

• the outcome of ourcopper concentrate sales and treatment and refining chargenegotiations;

• the resolution of environmental and other proceedings ordisputes;

• the future supply of reasonably priced power;

• rainfall in thevicinity of MVC continuing to trend towards normallevels;

• average recoveries for fresh tailings and Cauquenestailings;

• our ability to obtain, comply with and renew permits andlicenses in a timely manner; and

• our ongoing relations with our employees and entities withwhich we do business.

Future production levels and cost estimatesassume there are no adverse mining or other events which significantlyaffect budgeted production levels.

Although the Company believes that theseassumptions were reasonable when made, because these assumptions areinherently subject to significant uncertainties and contingencieswhich are difficult or impossible to predict and are beyond theCompany’s control, the Company cannot assure that it will achieve oraccomplish the expectations, beliefs or projections described in theforward-looking statements.

We caution you that the foregoing list ofimportant factors and assumptions is not exhaustive. Other events orcircumstances could cause our actual results to differ materially fromthose estimated or projected and expressed in, or implied by, ourforward-looking statements. You should also carefully consider thematters discussed under Risk Factors in the Company`s AnnualInformation Form. The forward-looking statements contained hereinspeak only as of the date of this news release and except as requiredby law, we undertake no obligation to update publicly or otherwiserevise any forward-looking statements or the foregoing list offactors, whether as a result of new information or future events orotherwise.

Contact Details

Aurora Davidson,President and CEO

+1 604-697-6207

ad@amerigoresources.com

GrahamFarrell, Investor Relations

+1 416-842-9003

graham.farrell@harbor-access.com

CompanyWebsite

http://www.amerigoresources.com/

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