ASND.WT Ascendant Resources Inc

Ascendant Resources Inc. (TSX: ASND) (OTCQX: ASDRF; FRA: 2D9) ("Ascendant" or the "Company”) reports second quarter 2019 results, highlighted by record throughput and contained metal production of 24.6 million zinc equivalent (“ZnEq”) pounds since assuming ownership of the El Mochito mine in Honduras.

Production at El Mochito exceeded budget expectations, with continued improved operating performance in the second quarter 2019 (“Q2/19”) highlighted by increased tonnes milled combined with higher head grades resulting in increased contained metal production. During the first half of the year (“H1/19”), the Company made a significant investment in additional underground development in order to access higher-grade ore bodies which are currently being mined. The investment in development is expected to lead to increased higher-grade production in the second half of 2019 (“H2/19”), driving further increases in contained metal production and lower unit costs at the mine.

Lower metal prices, additional increases to power costs, higher treatment and refining charges (“TCs & RCs”) and investment in development impacted profitability in Q2/19. Cash operating costs were in line with previous quarters and direct operating costs marginally above those in Q1/19 at El Mochito. The Company reported adjusted EBITDA of $0.51 million, a net loss of $4.18 million and a loss per share of $0.05 for Q2/19.

Mr. Chris Buncic, President & CEO of Ascendant stated, “Despite pressure from lower commodity prices, higher refining and treatment charges and increased power costs, we remain focused on the long-term profitability and growth potential at El Mochito. We invested heavily in development during the first half of the year and are already seeing the benefits. We expect to see minesite AISC at approximately $1.10 and approximately $1.15 on a consolidated basis during the second half of the year.”  

He continued, “We are well advanced on several avenues of funding for both the expansion project at El Mochito; which we expect to begin construction later this year, as well as for general liquidity purposes which we hope to see us through to the completion of the expansion project.”  

“In addition, given the success of the recent drill program at Lagoa Salgada we are highly confident in the future potential of this project to significantly enhance shareholder value. The recent drill program focused on providing an economic case for the North Zone which we hope to provide through an updated NI 43-101 Mineral Resource Estimate in the third quarter and a Preliminary Economic Assessment (“PEA”) which will be completed by the end of the year. The North Zone continues to remain open in all directions. The Company also undertook supplemental drilling in the Central and South Zones that also look to be highly promising. We expect to deliver news of this supplemental drilling in the near future.”

A summary of key operational and financial performance for the second quarter 2019 is provided in the tables below:

						Three months ended						Six months ended
Key Operating Information						June 30,			June 30,			June 30,			June 30,
							2019			2018			2019			2018
Total Tonnes Mined					tonnes		196,644			189,690			398,106			376,944
Total Tonnes Milled					tonnes		195,706			192,428			388,628			379,382
Average Head Grades
		Average Zn grade			%		4.4	%		4.3	%		4.3	%		4.2	%
		Average Pb grade			%		1.7	%		1.5	%		1.7	%		1.6	%
		Average Silver grade			g/t		67			48			65			47
		ZnEq Head grade	(1	)	%		6.7	%		6.3	%		6.7	%		6.2	%
Average Recoveries
		Zinc			%		86.4	%		89.7	%		85.3	%		89.9	%
		Lead			%		81.5	%		79.1	%		80.5	%		77.2	%
		Silver			%		81.9	%		79.4	%		80.5	%		79.0	%
Contained Metal Production
		Zinc			000's lbs		16,444			16,343			31,606			31,644
		Lead			000's lbs		5,916			5,109			11,870			10,235
		Silver			ozs		347,784			229,043			641,071			444,642
		ZnEq	(1	)	000's lbs		24,638			22,926			48,008			44,338
Payable Production
		Zinc	0.9		000's lbs		13,977			13,892			26,865			26,898
		Lead	1		000's lbs		5,620			4,854			11,277			9,723
		Silver	0.7		ozs		243,449			160,330			448,750			311,249
		ZnEq	(1	)	000's lbs		20,942			19,487			40,807			37,687
Payable Metal Sold
		Zinc			000's lbs		12,028			14,054			23,804			29,340
		Lead			000's lbs		5,282			5,331			10,172			11,654
		Silver			ozs		295,859			181,372			517,234			350,537
		ZnEq	(1	)	000's lbs		19,145			20,253			37,386			41,796
Average Realized Metal Price
		Zinc			$/lb	$1.25			$1.35			$1.24			$1.44
		Lead			$/lb	$0.86			$1.09			$0.89			$1.08
		Silver			$/oz	$14.94			$16.39			$15.19			$16.40
Cash operating cost per ZnEq payable lb sold			(2	)	$/ZnEq lb	$0.76			$0.76			$0.76			$0.79
AISC per ZnEq payable lb sold - El Mochito			(2	)	$/ZnEq lb	$1.32			$1.31			$1.27			$1.28
AISC per ZnEq payable lb sold - Consolidated			(2	)	$/ZnEq lb	$1.43			$1.39			$1.37			$1.36
Direct operating cost per tonne milled (excl. CAPEX)			(2	)	$/tonne	$81.79			$76.61			$81.16			$74.50
(1	)	Assumes average spot metal prices for the period.
(2	)	This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.
						Three months ended						Six months ended
Financial						June 30,			June 30,			June 30,			June 30,
							2019			2018			2019			2018
		Total revenue			$000's		18,033			22,657			35,817			50,695
		Mine operating expenses			$000's		17,177			17,545			33,706			37,169
		Income (loss) from mining operations			$000's		856			5,112			2,111			13,526
		Net income (loss)			$000's		(4,177	)		4,582			(6,587	)		9,876
		Adjusted EBITDA	(2	)	$000's		510			7,379			1,956			15,318
		Operating cash flow before movements in working capital	(2	)	$000's		(658	)		5,803			7,384			12,572
		Operating cash flow			$000's		(5,477	)		6,494			2,748			17,912
		Cash and cash equivalents			$000's		2,207			11,322			2,207			11,322
		Working capital			$000's		(11,813	)		8,961			(11,813	)		8,961
		Capital Expenditures			$000's		4,917			8,002			8,937			14,118
(1	)	Assumes average spot metal prices for the period.
(2	)	This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.

Second Quarter 2019 Operational Performance

During Q2/19 contained ZnEq metal production was 24.6 million pounds, an 8% increase over second quarter 2018 (“Q2/18”) production of 22.9 million pounds and a 5% increase over the previous strong first quarter 2019 (“Q1/19”)  of 23.4 million pounds as a result of higher zinc, lead and especially silver grades.

Milled throughput for Q2/19 was 195,706 tonnes, demonstrating a slight improvement of 2% over 192,428 tonnes in Q2/18 and a 1% improvement over 192,922 tonnes in Q1/19, as this was the first full operating quarter benefiting from the recently completed Esperanza development tunnel, which provides for more direct and efficient access from the Esperanza orebody to the underground crusher. 

The average head grade of 6.7% ZnEq for the quarter represents an increase of 7% over the 6.3% achieved in Q2/18 and was in line with Q1/19. Milled zinc grades for the quarter were 4.4% zinc, up 4% from both Q2/18 and Q1/19. Lead head grades were up 9% from Q2/18 to 1.7% but slightly down from the 1.8% achieved in the previous quarter. Silver feed grades increased significantly by 40% to 67 g/t from the 48 g/t achieved in Q2/18 and increased 8% from 62 g/t in Q1/19. The increase in silver and lead grades over Q2/18 are a direct result of the Company focusing on extraction of various, small high-grade pillars in the upper historic part of the mine.

Zinc processing recoveries of 86.4% in Q2/19 demonstrated an improvement of 3% over the previous quarter but were still 4% below the 89.7% achieved in the same period in the previous year, mainly due to the complicated metallurgy of the Esperanza ore, which is currently a material portion of the mill feed. This was offset by a 3% higher lead and silver recovery of 81.5% and 81.9% respectively in Q2/19 vs Q2/18. Lead and silver recoveries for the quarter were also higher by 2% and 4%, respectively, than the previous quarter. The higher lead recoveries are attributable to the higher grades, while the higher silver recoveries received a boost after a change to the silver collector reagent dosing strategy in the floatation circuit. It is expected that the higher silver recoveries can be maintained into the future.

The Company had previously anticipated lower metal production during the first half of 2019, with stronger performance in the second half of the year due to higher grades. Operational performance to date has exceeded those expectations and the mine remains well positioned for stronger performance in the second half of 2019.

Second Quarter 2019 Financial Performance

In Q2/19 the Company generated revenues of $18.03 million as a result of the sale of 19.1 million pounds of ZnEq metal, comprised of 12.0 million pounds of payable zinc in concentrates, 5.3 million pounds of payable lead in concentrates and 295,859 ounces of payable silver in concentrates. Average realized provisional metal prices were $1.25 per pound zinc, $0.86 per pound lead and $14.94 per ounce silver. Revenues in Q2/19 were down 20% over Q2/18 as a result of substantially lower metal prices. Although revenue was in line with Q1/19, Q2/19 revenue was the first full quarter with 100% of sales being made under much higher 2019 benchmark TCs & RCs.

Net loss and basic and diluted loss per share in Q2/19 were $4.18 million and $0.05 respectively, compared to net income and basic and diluted earnings per share $4.58 million and $0.06 in Q2/18, and a net loss and basic and diluted loss per share in Q1/19 of $2.41 million and $0.03. Income from mining operations in Q2/19 was $0.86 million.

Adjusted EBITDA for Q2/19 was $0.51 million, compared to Adjusted EBITDA of $7.38 million in Q2/18 and $1.45 million in Q1/19.        Direct operating costs per tonne milled for Q2/19 at El Mochito were $81.79, a 7% increase vs Q2/18 direct operating costs per tonne milled of $76.61, and a 2% increase vs Q1/19 direct operating costs per tonne milled of $80.53. The increase over Q2/18 is primarily a result of the previously disclosed 15% increase in national power rates imposed in September 2018 as well as the 6% increase in labour costs that took place in October 2018 in compliance with the collective bargaining agreement the Company has with the unionized workforce at the mine. The Company has been actively evaluating alternatives to reduce power costs over the long-term and is in advanced discussions with several third-party power producers to provide a reliable long-term and cost-effective source of power. Also contributing to the higher overall operating costs per tonne was the increased proportion of labour intensive conventional mining required to mine the higher-grade chimney ore, which in turn has reflected its benefits in the improved grade profile of the mine, reducing operating costs on a per payable pound basis. The slight increase in direct operating costs on a per tonne milled basis over Q1/19 is also primarily due to a further 10% increase in power rates imposed in April 2019 and retroactively applied to March 2019. Although the Company has benefited from cost reductions as a result of the bypass access ramp to Esperanza, completed in February, shortening the average underground hauling distances, these gains have been offset by the increase in power and labour costs.

The Company has been successful at offsetting the aforementioned labour and power cost pressures through grade improvements and increased contained metal production. As such, cash operating cost per ZnEq payable pound sold for Q2/19 was $0.76, in line with both Q2/18 and Q1/19, as a result of the higher-grade production coming from the conventional mining sections in the mine and ongoing improvements to infrastructure. Despite energy and labour cost pressures, the Company has maintained or reduced cash operating cost per ZnEq payable pound sold throughout 2018 and 2019, due to the focus on improving metal production.

The All-In Sustaining Cost (”AISC”) on a minesite basis at El Mochito in Q2/19 was $1.32 per ZnEq payable pound sold, representing a 1% increase from Q2/18 of $1.31 and an 8% increase over Q1/19 of $1.22. The increase in the current quarter is primarily a result of ongoing increases in energy costs, a full quarter application of the higher 2019 benchmark TCs & RCs which totalled $0.26 per ZnEq lb in Q2/19 as compared to $0.16 per ZnEq lb in Q2/18 and $0.19 per ZnEq lb in Q1/19. In addition, sustaining capital expenditures totalled $0.25 per ZnEq lb in Q2/19, which represented a decrease from $0.31 per ZnEq lb in Q2/18 but was an increase relative to $0.21 per ZnEq lb in Q1/19 due to higher rates of underground development as well as minor mobile equipment purchases. The AISC on a consolidated basis for Q2/19 was $1.43 per ZnEq  payable pound sold, representing a 3% increase from Q2/18 of $1.39 and an increase of 10% over the previous quarter of $1.30 due to the higher TCs & RCs, higher sustaining capital expenditures, and included a non-recurring charge of $0.03 per ZnEq lb with respect to financial advisory fees.

Lagoa Salgada Project

In Q2/19, the Company commenced a 26-hole, 8000-metre drill program at Lagoa Salgada. This phase of drilling focused on step out and infill drilling in all three known deposits in the LS West region, with an emphasis on the North Zone (massive sulphide), which constitutes the majority of the current Mineral Resource Estimate at Lagoa Salgada. These 26 holes will form the basis for the updated mineral Resource Estimate expected in Q3/19, in which the Company expects to significantly expand and upgrade total resources.

The Company had tremendous success with the modest 2018 drill campaign which included 20 holes totalling 7,077 metres of drilling, which significantly grew the size and confidence of the resource base in the Mineral Resource Estimate announced in Q1/19. Given this and the exploration success achieved so far in 2019, the Company remains very confident of the potential to further increase the resource size and scale.  

Management believes Lagoa Salgada has the potential to be a sizeable VMS deposit and is highly optimistic the project has the potential to be mineable given the exploration success achieved to date. As such the Company anticipates the completion of an initial Preliminary Economic Assessment by the end of the year.

Subsequent to the quarter, on July 24, 2019 the Company released significant drill results from 15 holes totaling 4,275 metres of the 26-hole program. Results from 14 of these holes in the North Zone continue to demonstrate high-grade mineralization in the massive sulphide and in the gossan lenses over extended true widths/intervals. Drilling intersected additional massive sulphide mineralization extending the mineralization of this zone at depth and along strike which is expected to greatly contribute to the Mineral Resource Estimate update. Elevated gold and tin values found in these results underlies the high-grade mineralization in the gossan lens while gold, silver, zinc and lead were strong contributors to high-grade mineralization in the massive sulphide lens.

Highlighted holes include:

		TRUE	Cu	Pb	Zn	Au	Ag	Sn	ZnEq[1,2]
	Zone	Thickness (m)	(%)	(%)	(%)	(ppm)	(ppm)	(%)	(%)
LS_MS_26	gossan	9.12	0.16	9.79	1.13	2.54	37.64	0.39	16.52
LS_MS_30	gossan	13.42	0.06	5.99	0.33	3.95	16.56	0.61	13.19
LS_MS_33	MS	24.87	0.42	6.56	5.76	1.17	184.84	0.23	21.09
LS_MS_36	MS	20.33	0.23	6.14	9.76	1.42	104.65	0.19	22.61
LS_MS_35	MS	37.58	0.25	4.10	6.87	1.19	99.42	0.17	17.21
LS_MS_22	MS	60.10	0.46	2.91	3.70	0.77	81.04	0.11	11.62
LS_MS_25	MS	19.56	0.21	5.23	5.76	1.29	137.32	0.23	18.32

Notes: 1 ZnEq% was calculated as follows: ZnEq% = ((Zn Grade*25.35)+(Pb Grade*23.15)+(Cu Grade * 67.24)+(Au Grade*40.19)+(Ag Grade*0.62)+Sn Grade*191.75)/25.35 2 Metal prices used: US$1.15/lb Zn, US$1.05/lb Pb, $3.05/lb Cu, US$8.70/lb Sn, US$19.40/oz Ag, and 1,250/oz Au. No recoveries were applied.

Outlook

Operations & Financial

Metal production during the second half of the year is expected to show strong improvement as a result of increased investment in development during the first half of the year. The development has accessed higher grade areas of the mine resulting in greater anticipated contained metal production.

The Company’s mine plan for 2019 anticipated greater metal production during the second half of the year driven by an increase in grades from access gained to the significantly higher-grade upper portion of the mine. Average head grades during the second half of 2019 are expected to be approximately 8% ZnEq. The increased grades will be weighted towards the fourth quarter.

Based on higher expected grades to be mined over the course of the second half, the AISC on a minesite basis at El Mochito is expected to be approximately $1.10 per ZnEq payable pound sold, and the AISC on a consolidated basis is expected to be approximately $1.15 per ZnEq payable pound sold. As discussed above, this improvement is expected to be weighted towards the fourth quarter.  

Unit costs in general should also benefit as a result of higher metal production, however, based upon current cost pressures, direct operating costs are expected to lean towards the higher end of the guidance range due to the increased proportion of conventional mining methods used to mine the higher-grade ore, as well as ongoing external cost pressures.

The Company however maintains its 2019 production guidance, as announced on February 20, 2019 provided in the table below: 

Contained Metals in Concentrate
Zinc equivalent metal	90 – 110 million lbs
Zinc	65 – 75 million lbs
Lead	21 – 26 million lbs
Silver	850,000 – 1,200,000 ozs
Direct Operating Costs	$70 – $80 / tonne
Capital Expenditure	$15 – $20 million

Also subsequent to the quarter, on July 24, 2019, the Company, through its Honduran subsidiary American Pacific Honduras SA de CV (“AMPAC”), received an exemption on VAT for local purchases from the Honduran Tax Authority, positively affecting the overall cash flow position. This exemption is expected to improve 2019 cash flow by approximately $1 million and have an ongoing benefit of approximately $2 million per annum as the exemption is renewable annually.  

Mine Expansion and Optimization

The Company remains actively engaged in advancing the various project financing opportunities for the expansion of El Mochito. The Preliminary Economic Assessment for the expansion of the mine demonstrates the Company’s dedication and focus on delivering long-term profitability and the ability to operate the mine at an average all-in sustaining cost of $0.97 per ZnEq payable pound, well below current prices and long-term metal price assumptions. It is the Company’s current expectation to begin construction this year.

Exploration Activities

Exploration is ongoing at both El Mochito and Lagoa Salgada and will continue to play a significant role in enhancing growth opportunities at both properties going forward.

El Mochito

Exploration at El Mochito thus far in 2019 has been focused on infill drilling for the goal of upgrading Inferred Mineral Resources and further extending the mine life as well as exploration drilling to explore untested areas with the purpose of discovering the next large, high-grade chimney.

The new development ramp to Esperanza has provided significant exploration opportunity for the Company as it has allowed for access to an area of the mine that has never been tested before. The Company is currently conducting drilling, following up on geophysical survey and Induced Polarization targets.

Lagoa Salgada

On July 24, 2019 the Company released significant drill results from 15 holes totaling 4,275 metres of the 26-hole program. Results from 14 of these holes in the North Zone continue to demonstrate high-grade mineralization in the massive sulphide and in the gossan lenses over extended true widths. Drilling intersected additional massive sulphide mineralization extending the mineralization of this zone at depth and along strike which is expected to greatly contribute to the Mineral Resource Estimate update. Elevated gold and tin values found in these results underlies the high-grade mineralization in the gossan lens while gold, silver, zinc and lead were strong contributors to high-grade mineralization in the massive sulphide lens.

The remaining drill hole from these results, was one of three that successfully tested new targets in the Central and South Zones (stockwork). Results from this drill hole demonstrated high-grade mineralization with elevated copper values that are thought to be consistent with the expected mineralization in the Central and South Zones.

Results from the remaining 11 holes are expected imminently as drilling completed on July 25, 2019.

A second phase of drilling will focus on the two highly prospective Central and South Zones and will be contingent on the drill results from the current program and of a borehole IP survey to be conducted on the current drill holes from this program. This survey will be undertaken after the end of the current drill program.

The intended IP survey on the 8-kilometre gravity anomaly identified in the northern portion of the property (the LS North and LS East regions), which follows the Company’s tremendous success to date in correlating drilling results to anticipated mineralization with Induced Polarized (“IP”) surveys in the North and South Zones, provides optimism in identifying new targets along this highly prospective trend for longer-term growth potential of the project. 

Conference Call Details

A conference call will be held tomorrow, August 8, 2019, at 10:00am EDT to discuss second quarter 2019 operational and financial results.

Dial-in Details:Date of Call: Thursday, August 8, 2019Time of Call: 10:00am EDTConference ID: 2681208Dial-In Numbers:North American Toll-Free: 1-833-696-8362International: 1-612-979-9908

A recorded playback of the conference call will be available from August 8, 2019 until September 8, 2019 and can be accessed on the Company’s website at www.ascendantresources.com within the Investors section.

The information provided within this release should be read in conjunction with Ascendant’s unaudited condensed consolidated interim financial statements and management's discussion and analysis for the three and six months ended June 30, 2019 and 2018, which are available on Ascendant’s website and on SEDAR. As at January 1, 2017, the Company has changed its presentation currency to the U.S. dollar (US). All financial figures are in US dollars unless otherwise stated.

Technical Disclosure/Qualified Person

The scientific and technical information contained in this press release has been reviewed and approved by Robert A. Campbell, M.Sc., P.Geo., Director and Vice President, Exploration for Ascendant Resources Ltd., whom is a "qualified person" within the meaning of NI 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”).

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned producing El Mochito zinc, lead and silver mine in west-central Honduras and its high-grade polymetallic Lagoa Salgada VMS Project located in the prolific Iberian Pyrite Belt in Portugal.

After acquiring the El Mochito mine in December 2016, Ascendant spent 2017 and 2018 implementing a rigorous and successful optimization program restoring the historic potential of El Mochito, a mine in production since 1948, to deliver record levels of production with profitability restored. The Company now remains focused on cost reduction and further operational improvements to drive profitability in 2019 and beyond. With a significant land package of approximately 11,000 hectares in Honduras and an abundance of historical data, there are several near-mine and regional targets providing longer term exploration upside which could lead to further Mineral Resource growth.

Ascendant holds an interest in the high-grade polymetallic Lagoa Salgada VMS Project located in the prolific Iberian Pyrite Belt in Portugal. The Company is engaged in exploration of the Project with the goal of expanding the already-substantial defined Mineral Resources and testing additional known targets. The Company’s acquisition of its interest in the Lagoa Salgada Project offers a low-cost entry point to a potentially significant exploration and development opportunity. The Company holds an additional option to increase its interest in the Project upon completion of certain milestones.

Ascendant Resources is engaged in the ongoing evaluation of producing and development stage mineral resource opportunities, on an ongoing basis. The Company's common shares are principally listed on the Toronto Stock Exchange under the symbol "ASND". For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release. For further information please contact:

Katherine PrydeDirector, Communications & Investor RelationsTel: 888-723-7413info@ascendantresources.com

Cautionary Notes to US Investors

The information concerning the Company’s mineral properties has been prepared in accordance with National Instrument 43-101 (“NI-43-101”) adopted by the Canadian Securities Administrators. In accordance with NI-43-101, the terms “mineral reserves”, “proven mineral reserve”, “probable mineral reserve”, “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on May 10, 2014. While the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are recognized and required by NI 43-101, the U.S. Securities Exchange Commission (“SEC”) does not recognize them. The reader is cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally mined. It cannot be assumed that all or any part of any inferred mineral resource will ever be upgraded to a higher category. Therefore, the reader is cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category. Likewise, you are cautioned not to assume that all or any part of a measured or indicated mineral resource will ever be upgraded into mineral reserves.

Readers should be aware that the Company’s financial statements (and information derived therefrom) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing and auditor independence standards. IFRS differs in some respects from United States generally accepted accounting principles and thus the Company’s financial statements (and information derived therefrom) may not be comparable to those of United States companies.

Forward Looking Information                This news release contains "forward-looking statements" and "forward-looking information" (collectively, "forward-looking information") within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budget", "guidance", "scheduled", "estimates", "forecasts", "strategy", "target", "intends", "objective", "goal", "understands", "anticipates" and "believes" (and variations of these or similar words) and statements that certain actions, events or results "may", "could", "would", "should", "might" "occur" or "be achieved" or "will be taken" (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as "providing the Company with", "is currently", "allows/allowing for", "will advance" or "continues to" or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the consistency of processing recovery levels, improvements of grades in 2019, guidance, increase in contained metal production, maintenance of production rates, increase of mill feed grades, reduction of costs, monthly shipments of concentrate, the ability to fully fund planned development, the ability to successfully close its financing initiatives, exploration and capital expenditures at El Mochito and Lagoa Salgada, the expectation of expanding and updating the Mineral Resource Estimate at Lagoa Salgada, the Company’s ability to complete a Preliminary Economic Assessment for Lagoa Salgada, robust adjusted EBITDA and free cash flow generation and the undertaking of various long-term optimization programs including but not limited to the expansion program at El Mochito. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Ascendant at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the ability of the Company to maintain the consistency of processing recovery levels, to improve grades in 2019, to achieve guidance, increase contained metal production, maintain production rates, increase mill feed grades, reduce costs, make monthly shipments of concentrate, fully fund planned development, successfully closing on its financing initiatives, exploration and capital expenditures, maintain robust adjusted EBITDA and free cash flow and undertake various long-term optimization programs including but not limited to the expansion program at El Mochito, the Company’s ability to expand and update the Mineral Resource Estimate at Lagoa Salgada, complete a Preliminary Economic Assessment for Lagoa Salgada, and other events that may affect Ascendant's ability to develop its project; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant's projects, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant's ability to obtain financing on acceptable terms, the failure to achieve guidance, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, as well as the risks discussed in Ascendant's most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

NON-IFRS PERFORMANCE MEASURES

The non-IFRS performance measures presented do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be directly comparable to similar measures presented by other issuers.

Non-IFRS reconciliation of Adjusted EBITDA

EBITDA is a non-IFRS measure that represents an indication of the Company’s continuing capacity to generate earnings from operations before taking into account management’s financing decisions and costs of consuming capital assets, and management’s estimate of their useful life. EBITDA comprises revenue less operating expenses before interest expense (income), property, plant and equipment amortization and depletion, and income taxes. Adjusted EBITDA has been included in this document. Under IFRS, entities must reflect in compensation expense the cost of share-based payments. In the Company’s circumstances, share-based payments involve a significant accrual of amounts that will not be settled in cash but are settled by the issuance of shares in exchange for cash. EBITDA and Adjusted EBITDA do not have any standardized meaning prescribed by IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. EBITDA and Adjusted EBITDA exclude the impact of cash costs of financing activities and taxes, and the effects of changes in operating working capital balances, and therefore are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate EBITDA and Adjusted EBITDA differently. As such, the Company has made an entity specific adjustment to EBITDA for these expenses. The Company has also made an entity-specific adjustment to the foreign currency exchange (gain)/loss.

The following table provides a reconciliation of net income (loss) to Adjusted EBITDA:

						Three months ended						Six months ended
Adjusted EBITDA						June 30,			June 30,			June 30,			June 30,
							2019			2018			2019			2018
Net income (loss)					$000's		(4,177	)		4,582			(6,587	)		9,876
Adjusted for:
		Advances to joint venture			$000's		389			-			578			-
		Depletion and depreciation			$000's		1,728			1,110			3,338			1,983
		Finance expenses			$000's		804			335			1,201			372
		Accretion expense on rehabilitation liabilities			$000's		68			203			135			410
		Charge on termination obligations			$000's		1,193			414			2,312			835
		Share-based payments			$000's		133			352			266			704
		Foreign currency exchange gain/loss			$000's		(67	)		34			3			(62	)
		Income taxes			$000's		439			354			710			1,200
Adjusted EBITDA					$000's		510			7,384			1,956			15,318

Direct operating cost per tonne milled

The Company uses the non-IFRS measure of direct operating cost per tonne milled to manage and evaluate operating performance. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The Company considers cost of sales per tonne milled to be the most comparable IFRS measure to direct operating cost per tonne milled and has included calculations of this metric in the reconciliations within the applicable tables to follow.

Direct operating cost per tonne milled includes mine direct operating production costs such as mining, processing, administration, indirect charges as surface maintenance and camp expenses, and inventory sales adjustments but does not include, smelting, refining and freight costs, royalties, depreciation, depletion, amortization, reclamation, and capital costs.

The following table provides a reconciliation of direct operating costs to cost of sales:

						Three months ended						Six months ended
Direct operating cost per tonne milled						June 30,			June 30,			June 30,			June 30,
							2019			2018			2019			2018
		Mine operating expenses (from consolidated income statement)			$000's		17,177			17,545			33,706			37,169
		Add: Termination Liability Payments			$000's		7			250			17			478
		Deduct (Add): Variation in Finished Inventory			$000's		1,390			(624	)		2,979			(4,802	)
		Deduct: Depreciation in production			$000's		(1,701	)		(1,105	)		(3,284	)		(1,983	)
Total cash costs (including royalties)					$000's		16,873			16,066			33,418			30,862
		Deduct: Government taxes and royalties			$000's		(866	)		(1,324	)		(1,875	)		(2,598	)
Direct operating costs					$000's		16,007			14,742			31,543			28,264
		Tonnes Milled			tonnes		195,706			192,428			388,628			379,382
Direct operating cost per tonne milled					$/tonne	$81.79			$76.61			$81.16			$74.50
						Three months ended						Six months ended
AISC per ZnEq payable pound sold						June 30,			June 30,			June 30,			June 30,
							2019			2018			2019			2018
ZnEq payable pounds sold					000's lbs		19,145			20,253			37,386			41,796
Cash Operating Costs Reconciliation
		Direct operating costs			$000's		16,007			14,742			31,543			28,264
		Add (deduct): Variation in Finished Inventory			$000's		(1,390	)		624			(2,979	)		4,802
Cash operating costs					$000's		14,617			15,366			28,564			33,066
Cash operating cost per ZnEq payable pound sold					$/ZnEq lb	$0.76			$0.76			$0.76			$0.79
All-in Sustaining Costs (AISC) Reconciliation
		Total cash operating costs			$000's		14,617			15,366			28,564			33,066
		Add: Government taxes and royalties			$000's		866			1,324			1,875			2,598
		Add: TC & RCs			$000's		4,885			3,331			8,382			7,051
		Add: G&A, excluding depreciation and amortization			$000's		2,062			1,672			3,474			3,384
		Add: Accretion expense on rehabilitation liabilities			$000's		68			203			135			410
		Add: Sustaining capital expenditure			$000's		4,833			6,245			8,611			10,430
Total All-in sustaining costs - Consolidated					$000's		27,331			28,141			51,041			56,939
		Deduct: G&A, excluding depreciation and amortization			$000's		(2,062	)		(1,672	)		(3,474	)		(3,384	)
Total All-in sustaining costs - El Mochito					$000's		25,269			26,469			47,567			53,555
AISC per ZnEq payable pound sold - Consolidated					$/ZnEq lb	$1.43			$1.39			$1.37			$1.36
AISC per ZnEq payable pound sold - El Mochito					$/ZnEq lb	$1.32			$1.31			$1.27			$1.28

Additional non-IFRS measures

The Company uses other financial measures, the presentation of which is not meant to be a substitute for other subtotals or totals presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. The following other financial measures are used:

• Operating cash flows before movements in working capital - excludes the movement from period-to-period in working capital items including trade and other receivables, prepaid expenses, deposits, inventories, trade and other payables and the effects of foreign exchange rates on these items.

The terms described above do not have a standardized meaning prescribed by IFRS, and therefore the Company’s definitions are unlikely to be comparable to similar measures presented by other companies. The Company’s management believes that their presentation provides useful information to investors because cash flows generated from operations before changes in working capital excludes the movement in working capital items. This, in management’s view, provides useful information of the Company’s cash flows from operations and are considered to be meaningful in evaluating the Company’s past financial performance or its future prospects. The most comparable IFRS measure is cash flows from operating activities.

_____________________________________

1 ZnEq lbs and grades in % represents zinc metal considered together with the lead and silver expressed in zinc equivalent terms of zinc using spot metal prices and production during the period.