FIRST MAJESTIC SILVER CORP.
Suite 1805 – 925 West Georgia Street
Vancouver, B.C., Canada V6C 3L2
Telephone: (604) 688-3033 Fax: (604) 639-8873
Toll Free: 1-866-529-2807
Web site: www.firstmajestic.com; E-mail: info@firstmajestic.com
 

NEWS RELEASE

TSX Exchange – FR May 14, 2009
Pink Sheets – FRMSF  
Frankfurt – FMV (WKN: A0LHKJ)  

First Quarter Financial Results

FIRST MAJESTIC SILVER CORP. (FR-T) (the "Company") is pleased to announce the unaudited financial results for the Company's first quarter ending March 31, 2009. The full version of the financial statements and the management discussion and analysis can be viewed on the Company's web site at www.firstmajestic.com or on SEDAR at www.sedar.com.

1st Quarter Highlights 
Gross Revenue $17.5 million
Net Revenue $14.4 million
Mine Operating Earnings $4.5 million
Net Profit after taxes $0.9 million
Direct Cash Costs per ounce US$4.94
Silver Equivalent Production 1,040,117 oz. Ag eq.
Silver Equivalent Oz. Sold 996,595 oz. Ag eq.

FINANCIAL HIGHLIGHTS


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OPERATIONAL HIGHLIGHTS

The primary focus in the first quarter of 2009 was reducing operating costs and completing the La Encantada mill expansion program. As shown in the financial results, the Company has been successful in reducing operating costs across all of its mines. Presently, only two drill rigs are operating compared with 23 drill rigs in the third quarter of 2008. In addition, underground mine development is being financed from cash flow versus capital as was the case in 2008. These scaled back exploration and development measures will remain in force for the balance of 2009.

Prior to the decision to reduce the Company’s exploration program, the Company met its target on Resource development. The Company released two NI 43-101 Reports on both the La Parrilla Silver Mine and the San Martin Silver Mine in the first quarter which substantially increasing previously released estimates. As at the latest NI 43-101 Reports published in Q1, the Company has defined a global Resource of 300 million ounces of silver equivalents in all categories.


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La Parrilla Silver Mine

At the La Parrilla mine, production continued from the Rosarios/La Blanca and Quebradillas areas. The flotation circuit was operating more efficiently and recoveries are now closer to the target of 75%, however, at the cyanidation circuit recoveries had been affected by the mix of ores and short leaching times. Efforts are being made in order to improve the recoveries by increasing leaching time increasing the oxygenation in the cyanidation circuit.

During the quarter, the La Parrilla mine received the Clean Industry Certification from PROFEPA (Procuradoria Federal de Protecion al Ambiente). This certification resulted from a concerted effort over a period of more than two years.

San Martin Silver Mine

During the quarter the production at the San Martin was focused on improving head grades and reducing operating costs. Management was very pleased with the progress at this operation as can be seen by the cost reductions achieved in the quarter. These improvements were largely achieved due to a better mix of ore produced from the mine and the recovery of some backfills and dumps, which allowed the mine to operate in a more efficient way which resulted in a cost reduction of 61% compared to the first quarter of 2008.

La Encantada Silver Mine

At the La Encantada mine, a special effort is underway to improve the recoveries at the flotation plant which had been affected in the last few quarters by the mix of ore from the Azul y Oro vein which was found to contain manganese. Several new reagents and different mixes of ores are being tested in order to improve recoveries. In addition a new washing screen has been installed in order to wash the dump material which is anticipated to increase the grades of the recovered ore. This new process is expected to be operational during the last part of May.

Construction of the new 3500 tpd cyanidation mill continues to be the primary focus at the La Encantada and is proceeding well. All the leaching tanks and CCD thickeners are constructed with the installation of the mechanisms now underway. New pieces of equipment are arriving regularly and the plant is still anticipated to be commissioned in July. Once this new circuit is completed, the silver precipitates produced from the concentrates will be shipped to the La Parrilla mill for the production of doré bars.

In Summary

Equally important to increasing silver production is further cost reductions where possible. The 2009 operating plan thus far represents a year of reduced operating costs as a result of the Company’s pursuit of aggressive growth based on the expansion of its operations and Resources. Management is pleased with the many cost cutting measures underway, and it is believed that further improvements in profitability can be achieved with additional improvements expected going forward.

Finally, in this turbulent financial and commodity environment, First Majestic has been reacting by cutting costs wherever possible. The Company is continuing to analyze various options to reduce operating costs and to squeeze out the most optimum margins possible. During the quarter a new smelting agreement was executed for the sale of all the lead concentrates produced in 2009, and a new agreement was also signed for the sale of all doré produced by the Company in 2009. Both these agreements include terms better than previous agreements and are expected to go a long way in improving profitability.

First Majestic is a producing silver company focused in México and is aggressively pursuing its business plan to become a senior silver producer through the development of its existing assets and the pursuit through acquisition of additional assets that contribute to achieving its corporate growth objectives.

FOR FURTHER INFORMATION contact info@firstmajestic.com, visit our website at www.firstmajestic.com or call our toll free number 1.866.529.2807.

FIRST MAJESTIC SILVER CORP.

“signed”

Keith Neumeyer, President & CEO


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This press release includes certain "Forward-Looking Statements" within the meaning of section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential mineralization and reserves, exploration results and future plans and objectives of First Majestic Silver Corp. are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.