Great Panther Silver Reports First Quarter 2014 Financial Results

GREAT PANTHER SILVER LIMITED (TSX: GPR)(NYSE MKT: GPL) ("Great Panther"; the "Company") today reported financial results for the Company's three months ended March 31, 2014. The full version of the Company's unaudited condensed interim consolidated financial statements, and Management's Discussion and Analysis ("MD&A") can be viewed on the Company's website at www.greatpanther.com, or SEDAR at www.sedar.com. All financial information is prepared in accordance with IFRS and all dollar amounts are expressed in Canadian dollars unless otherwise indicated.

"Compared to the first quarter of 2013, Great Panther achieved 10% production growth, significant reductions in cash costs, and a modest increase in revenues despite significantly lower metal prices," stated Robert Archer , President and CEO. "That said, our results were impacted by incursions of illegal miners throughout the quarter, the illegal occupation of our facilities at Guanajuatoin March, and lower grades at Guanajuato."

"While I am extremely grateful for the support and resilience of our employees and contractors during this difficult period, we recognize there is still more work to do to bring the operations at Guanajuato back to an optimal state. We continued to have challenges with grades at Guanajuato in April, which will impact the financial results of the second quarter, but we expect operational results to markedly improve for the remainder of the year as we return to proper mine sequencing and better grades at Guanajuato. San Ignacio is on track to commence production in this quarter as planned, and we are maintaining our guidance for overall growth in 2014."

First Quarter 2014 Financial and Operational Highlights (Compared to First Quarter 2013 unless otherwise noted)

• Throughput totalled 72,631 tonnes, a 4% increase;

• Processing at Guanajuato included 8,037 tonnes of development ore from San Ignacio;

• Metal production of 667,349 silver equivalent ounces ("Ag eq oz") increased 10% and included 52,477 Ag eq oz fromSan Ignacio;

• Gold production increased 17% to 3,665 ounces while silver remained steady at 370,668 ounces;

• Cash cost per silver payable ounce ("cash cost") decreased 28% to US $13.40;

• Cash cost per silver payable ounce decreased 30% to US $12.06 at Guanajuato and decreased 26% to US $15.19 at Topia;

• All-in sustaining cost ("AISC") and All-in cost ("AIC") per silver payable ounce decreased 35% and 26%, to US $24.06and US $27.66, respectively;

• Revenues totalled $12.9 million, an increase of 2% despite significantly lower average metal prices;

• Net loss was $0.6 million compared to net income of $1.3 million;

• Adjusted EBITDA was negative $0.5 million compared to $0.5 million;

• Operating cash-flow before changes in non-cash working capital increased 168%;

• Cash and cash equivalents were $21.7 million compared to $21.8 million at December 31, 2013; and

• Net working capital decreased to $36.9 million from $38.2 million at December 31, 2013.

DISCUSSION OF FIRST QUARTER 2014 FINANCIAL RESULTS

For the three months ended March 31, 2014, the Company earned revenues of $12.9 million compared to $12.6 million for the same period of 2013, an increase of 2%. The increase was the result of an 11% increase in metal sales on a silver equivalent ounce basis and the appreciation of the USD against the CAD which had the effect of increasing revenue reported in CAD by 12%. These factors offset a 32% decline in the average realized silver price in USD terms and a similar decline in the gold price.

Cost of sales before non-cash items of $9.6 million (75% of revenue) for the three months ended March 31, 2014 was consistent with $9.5 million (75% of revenue) for the same period in 2013. Cost of sales did not increase despite an 11% increase in metal sales on a silver equivalent ounce basis due to a reduction in unit production costs.

Gross profit before non-cash items increased 5% to $3.3 million in the first quarter of 2014 compared to the first quarter of 2013. The increase is the result of an increase in metal sales on a silver equivalent ounce basis and lower unit production costs which together offset the impact of lower realized metal prices.

Amortization and depletion of mineral properties, plant and equipment relating to cost of sales for the three months ended March 31, 2014 was $3.6 million compared to $2.7 million for the same period in 2013. The increase in amortization and depletion expense is due to a reduction of the Measured and Indicated ("M&I") resource at Guanajuato, based on the updated NI 43-101 Resource report issued in December 2013, and the increase in sales on a silver equivalent ounce basis. The reduction of the resource has the effect of shortening the amortization period and therefore increasing the amortization expense per unit produced and sold.

Gross loss for the first quarter of 2014 was $0.4 million compared to gross profit of $0.3 million for the first quarter of 2013. The primary reason for the change was an increase in non-cash amortization and depletion of $0.7 million.

General and administrative expenses were $1.6 million for the three months ended March 31, 2014 compared to $2.0 million for the same period in 2013. The decrease reflects the impact of cost reductions initiated late in the second quarter of 2013.

Exploration and evaluation, and development expenses were $1.6 million for the three months ended March 31, 2014 compared to $0.6 million for the same period in 2013. The increase is primarily due to San Ignacio development expenditures of $1.2 millionwhich are being expensed as these did not meet the criteria for capitalization under IFRS. The Company made the decision to begin development based on internal economic assessments and expects to begin production in the second quarter of 2014.

Finance and other income was $3.2 million for the quarter ended March 31, 2014, compared to $4.4 million for the same period in 2013. The decrease is primarily attributed to a $0.5 million decrease in foreign exchange gains and $0.7 million in losses and expenditures associated with the illegal occupation of the Guanajuato mine, including the theft of concentrate worth $0.4 million.

A foreign currency gain of $3.8 million was recognized in the first quarter of 2014, compared to a foreign currency gain of $4.3 million for the first quarter of 2013. The gains are the result of the depreciation of the Canadian dollar against the Mexican peso and US dollar against the Canadian dollar.

The Company recorded an income tax expense of $26,000 for the three months ended March 31, 2014 despite a loss before income tax due to new tax duties which take effect in 2014 under the Mexican reform taxes. These new taxes were partially offset by recoveries related to pre-tax losses incurred by the Company's operations in Mexico. This compares to a $0.8 millionexpense in the same period in 2013 when the Company reported income before tax. During the first quarter of 2014, $0.2 millionand $0.1 million of Special and Extraordinary duties respectively were recorded in the income statement and accrued for payment in March 2015. The Company has net operating tax losses in Canada and has not recognized the benefit of any of these losses in the financial statements of the Company.

The net loss for the quarter ended March 31, 2014 was $0.6 million compared to net income of $1.3 million in the comparative quarter of 2013. Reasons for the increase in net loss include the development expenditures related to San Ignacio, and the additional losses and expenditures related to the illegal occupation of the Guanajuato plant and office premises. These factors were partly offset by lower general and administrative expenses, and a decrease in tax expense.

Adjusted EBITDA was negative $0.5 million for the three months ended March 31, 2014, compared to adjusted EBITDA of $0.5 million for the same period in 2013. The decrease in EBITDA primarily reflects the development expenditures made at San Ignacio, and the additional expenditures associated with the illegal occupation of the Guanajuato facilities.

CASH COST AND ALL-IN COSTS

Cash cost per silver payable ounce ("cash cost") of US $13.40 for the first quarter of 2014 decreased from US $18.60 in the first quarter of 2013, as declines in cash cost were realized at both Guanajuato and Topia. The improvement in cash cost is attributable to the cost reduction initiatives which reduced site costs per tonne, higher by-product credits from increased gold production at Guanajuato, improved silver grades at Topia, and a decrease in smelting and refining charges.

All-in sustaining cost per silver payable ounce ("AISC") for the first quarter of 2014 decreased to US $24.06 from US $36.84 in the first quarter of 2013. The decrease is the result of the decrease in cash costs, sustaining capital expenditures and general and administrative expenditures as a result of cost reduction programs initiated in the second quarter of 2013.

All-in cost per silver payable ounce ("AIC") for the first quarter of 2014 decreased to US $27.66 from US $37.59 in the first quarter of 2013 as a result of the same factors which reduced AISC.

Please refer to the Company's Management's Discussion and Analysis for further discussion of cash cost, AISC and AIC and for a reconciliation to the Company's financial results as reported under IFRS.

CASH AND WORKING CAPITAL AT MARCH 31, 2014

At March 31, 2014, the Company had cash and cash equivalents of $21.7 million compared to $21.8 million (including short-term investments) at December 31, 2013.

At March 31, 2014, the Company had working capital of $36.9 million compared to net working capital of $38.2 million atDecember 31, 2013. Working capital decreased by $1.3 million due to a comprehensive loss in the period of $1.0 million, an increase in non-current assets of $0.8 million primarily reflecting investments in capital equipment and mine development and capitalized exploration activities.

OUTLOOK

The Company is maintaining its 2014 guidance despite the challenges faced in the first quarter of 2014. At this time, the Company expects that the second quarter will reflect the impact of resuming normal operations at Guanajuato after the illegal occupation in March and continued grade challenges at the mine in April, some of which is associated with preparation necessary to return the higher grade Guanajuato zones to normal operation. A return to operations more closely reflecting the results in the fourth quarter of 2013 and the start of production at San Ignacio are expected to put the Company on track for meeting its guidance.

Overall metal production for 2014 is expected to increase gradually through the year as the San Ignacio mine and mill feed comes on stream. The project is expected to commence production in the second quarter of 2014 at a rate of about 100 tonnes per day, ramping up to approximately 250 tonnes per day by year-end, and will complement the steady stream of production from the mainGuanajuato Mine Complex and the Topia Mine.

The Company expects to invest approximately $10 to $13 million in capital expenditures in 2014. These investments include the development of the San Ignacio Project, continued mine development and diamond drilling at both Guanajuato and Topia, rehabilitation of the Cata Shaft at Guanajuato, and the acquisition of new mining and plant equipment to drive efficiencies and reduce production costs in the future.

The Company also plans to perform approximately 16,500 metres of exploration drilling in 2014 to further define resources, look for vein extensions, and test new targets. Planned drilling for the year consists of 11,000 metres at Guanajuato, 3,500 metres atSan Ignacio and 2,000 metres at Topia.

WEBCAST AND CONFERENCE CALL TO DISCUSS FISCAL YEAR 2013 FINANCIAL RESULTS

The Company will hold a live webcast and conference call to discuss the financial results on May 8, 2014, at 7:00 AM Pacific Daylight Time, 10:00 AM Eastern Daylight Time. Hosting the call will be Mr. Robert Archer , President and CEO, and Mr. Jim Zadra, CFO and Corporate Secretary.

Shareholders, analysts, investors and media are invited to join the live webcast and conference call by logging in or dialing in just prior to the start time.

Great Panther's archived webcast can be accessed by visiting the Investors section (http://www.greatpanther.com/Investors/Events/default.aspx) of the Company's website at www.greatpanther.com.