Vancouver, BC ¨C July 16, 2013 ¨C Sierra Metals Inc. (TSX:SMT)(BVL:SMT) (¡°Sierra Metals¡± or the ¡°Company¡±) is pleased to announce its production results for the second quarter of 2013.

Press Release Highlights:

• Total tonnes processed of 323,751 in the second quarter of 2013 compared to 325,913 tonnes in the same period of 2012. A 1% decrease year-over-year.
   


• Total silver (¡°Ag¡±) production of 669,620 ounces (¡°oz¡±) in the second quarter of 2013 compared to 670,706 oz for the same period of 2012. A nil change year-over-year.
   


• Total copper (¡°Cu¡±) production of 3.8 million pounds (¡°lb¡±) in the second quarter of 2013 compared to 4.1 million lb for the same period of 2012. A 9% decrease year-over-year.
   


• Total lead (¡°Pb¡±) production of 9.6 million lb in the second quarter of 2013 compared to 9.1 million lb for the same period of 2012. A 5% increase year-over-year.
   


• Total zinc (¡°Zn¡±) production of 12.8 million lb in the second quarter of 2013 compared to 15.3 million lb for the same period of 2012. A 16% decrease year-over-year.
   


• Total gold (¡°Au¡±) production from the Yauricocha Mine was 1,800 oz in the second quarter of 2013 compared to 2,876 oz for the same period of 2012. A 37% decrease year-over-year.

Daniel Tellechea, President and CEO of Sierra Metals, commented: ¡°We are pleased with the production results from all operations during the second quarter of 2013 and they remain in line with Sierra¡¯s 2013 production guidance. The Company remains focused on expanding production at both the Bolivar and Cusi mines in the third quarter of 2013. Sierra continues to strive towards its objective of becoming a premier, low-cost precious and base metals mining company in Latin America.¡±

Mine Operations

Sierra Metals maintained strong production results in the second quarter of 2013. During this period, the Company achieved a total of 323,751 tonnes of ore processed (compared to 325,913 tonnes in 2012) from all operations, representing a 1% decrease year-over-year.

Despite a decrease in production at the Yauricocha Mine, the Company maintained strong production in the quarter resulting from (1) the Cusi Mine achieving commercial production as of January 1, 2013, and (2) continued increases in operating efficiencies at the Bolivar Mine. Both of these achievements are part of the Company¡¯s growth strategy to expand production in Mexico during 2013. A summarized table of consolidated production results is presented below. 

Yauricocha Mine, Peru

The Yauricocha Mine continued to be the Company¡¯s largest producing mine with a total of 206,407 tonnes processed in the second quarter of 2013 representing a 5% decrease compared to 217,078 tonnes in 2012. Mineralization at the Yauricocha Mine is hosted in three different zones including the Copper, Lead-Oxide (¡°Oxides¡±) and Polymetallic ore-bodies.

Aggregate production of these ore bodies during the second quarter of 2013 was 481,058 oz of silver, a 12% decrease year-over year; 1.7 million lb of copper, a 23% decrease year-over-year; 9.4 million lb of lead, a 5% increase year-over year; 12.1 million lb of zinc, a 6% increase year-over year; and 1,800 oz of gold, a 37% decrease year-over-year. A summary of production from the Yauricocha Mine for the second quarter of 2013 has been provided below.

¹ For a detailed summary of production table for the Yauricocha Mine please click here.

Bolivar Mine, Mexico

During the second quarter of 2013, total ore processed at the Bolivar Mine increased 3% with 88,406 tonnes processed compared to 86,061 tonnes in 2012. Silver production at Bolivar increased 41% year-over-year with a total of 74,037 oz produced (compared to 52,544 in 2012). This substantial increase in production was a result of higher silver-grades (30.33 g/t Ag in 2013 compared to 24.38 g/t Ag in 2012) and an increase in recovery rates (85.58% recovery in 2013 compared to 77.74% in 2012) year-over-year. Copper production during the period increased 7% with a total of 2.0 million lb produced (compared to 1.9 million lb in 2012). Zinc production decreased 83% with a total of 0.7 million lb produced (compared to 3.8 million lb in 2012). The decline in Zinc production resulted from a decrease in Zinc grades (0.75% in 2013 compared to 2.51% in 2012) and reduced recovery rates (44.92% in 2013 compared to 80.12% in 2012). A summary of production for the Bolivar Mine for the second quarter of 2013 has been provided below.

¹ For a detailed summary of production table for the Bolivar Mine please click here.

Cusi Mine, Mexico

On January 1, 2013 the Company announced that the Cusi Mine achieved commercial production and during the second quarter of 2013 total ore processed increased 27% with a total of 28,937 tonnes of ore processed (compared to 22,773 tonnes in 2012). During the second quarter of 2013 production of silver at Cusi increased 56% with a total of 114,525 oz of silver (compared to 73,455 oz in 2012). Total lead production at Cusi increased 40% during the second quarter of 2013 with a total of 0.02 million lb (compared to 0.1 million in 2012). A summary of production for the Cusi Mine for the second quarter of 2013 has been provided below.

¹ For a detailed summary of production table for the Cusi Mine please click here.

Currently, the Company is in the midst of a substantial exploration and development program at Cusi that will focus on expanding production from Promontorio and adding new production from the San Juan, Minerva and La India mines by the end of 2013. Additionally, the Company anticipates completing an updated NI 43-101 resource calculation on the property in the third quarter of 2013.

Quality Control

The technical content of this news release has been approved by Thomas L. Robyn, Ph.D., CPG, RPG, a Qualified Person as defined in NI 43-101.

About Sierra Metals

Sierra Metals Inc. is a Canadian mining company focused on precious and base metals from its Yauricocha Mine in Peru, its Bolivar Mine and Cusi Mine in Mexico. In addition, Sierra Metals is exploring several precious and base metal targets in Peru and Mexico. Projects in Peru include Adrico (gold), Victoria (copper-silver) and Ipillo (polymetallic) at the Yauricocha Property in the province of Yauyos and the San Miguelito gold properties in Northern Peru. Projects in Mexico include Bacerac (silver) in the state of Sonora, La Verde (gold) at the Batopilas Property in the state of Chihuahua, and Las Coloradas (silver) at the Melchor Ocampo Property in the state of Zacatecas.

The Company¡¯s shares trade on the Bolsa de Valores de Lima and the Toronto Stock Exchange under the symbol ¡°SMT¡±.

For further information regarding Sierra Metals, please visit www.sierrametals.com or contact:

Forward-Looking Statements