Exhibit 99.3

SILVERCORP METALS INC.

Condensed Consolidated Interim Statements of Financial Position

(Unaudited) (Expressed in thousands of U.S. dollars)


			As at September 30,			As at March 31,
	Notes		2017			2017
ASSETS
Current Assets
Cash and cash equivalents	18	$	41,369		$	73,003
Short-term investments			57,255			23,466
Trade and other receivables			1,314			1,311
Inventories			9,922			8,710
Due from a related party	10		59			92
Prepaids and deposits			4,610			4,250
			114,529			110,832

Non-current Assets
Long-term prepaids and deposits			907			959
Reclamation deposits			5,242			5,054
Investment in an associate	3		29,524			8,517
Other investments	4		6,489			1,207
Plant and equipment	5		66,313			65,201
Mineral rights and properties	6		216,826			206,200
TOTAL ASSETS		$	439,830		$	397,970

LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued liabilities		$	24,705		$	30,374
Deposits received			8,891			6,798
Income tax payable			3,289			2,985
			36,885			40,157

Non-current Liabilities
Deferred income tax liabilities			30,241			27,692
Environmental rehabilitation			12,827			12,186
Total Liabilities			79,953			80,035

Equity
Share capital			232,386			232,155
Share option reserve	7		13,948			13,325
Reserves			25,409			25,409
Accumulated other comprehensive loss	8		(37,635	)		(50,419	)
Retained earnings			63,054			42,651
Total equity attributable to the equity holders of the Company			297,162			263,121

Non-controlling interests	9		62,715			54,814
Total Equity			359,877			317,935

TOTAL LIABILITIES AND EQUITY		$	439,830		$	397,970
Commitments and contingencies	17


Approved on behalf of the Board:

*(Signed) David Kong*
Director

*(Signed) Rui Feng*
Director

See accompanying notes to the condensed consolidated interim financial statements

SILVERCORP METALS INC.

Condensed Consolidated Interim Statements of Income

(Unaudited)(Expressed in thousands of U.S. dollars, except numbers for share and per share figures)


			Three Months Ended September 30,						Six Months Ended September 30,
	Notes		2017			2016			2017			2016
Sales	16(c)	$	47,541		$	46,298		$	87,238		$	81,569
Cost of sales
Production costs			16,177			13,789			30,286			27,942
Mineral resource taxes			1,317			1,030			2,428			1,441
Depreciation and amortization			4,441			5,720			8,913			10,683
			21,935			20,539			41,627			40,066
Gross profit			25,606			25,759			45,611			41,503

General and administrative	11		4,473			4,127			9,043			8,512
Government fees and other taxes	12		690			731			1,531			2,426
Foreign exchange loss (gain)			1,111			(215	)		2,726			(92	)
Loss (gain) on disposal of plant and equipment	5		6			(199	)		176			65
Gain on disposal of NSR	4		-			-			(4,320	)		-
Share of loss (income) in associate	3		125			(269	)		369			(286	)
Impairment of plant and equipment and mineral rights and properties			-			-			-			181
Other income			(126	)		(83	)		(307	)		(123	)
Income from operations			19,327			21,667			36,393			30,820

Finance income	13		650			537			1,224			968
Finance costs	13		(112	)		(260	)		(217	)		(524	)
Income before income taxes			19,865			21,944			37,400			31,264

Income tax expense	14		5,263			5,938			9,284			8,738
Net income		$	14,602		$	16,006		$	28,116		$	22,526

Attributable to:
Equity holders of the Company		$	11,145		$	12,378		$	22,082		$	17,052
Non-controlling interests	9		3,457			3,628			6,034			5,474
		$	14,602		$	16,006		$	28,116		$	22,526

Earnings per share attributable to the equity holders of the Company
Basic earnings per share		$	0.07		$	0.07		$	0.13		$	0.10
Diluted earnings per share		$	0.07		$	0.07		$	0.13		$	0.10
Weighted Average Number of Shares Outstanding - Basic			168,040,068			167,012,454			167,965,537			166,976,159
Weighted Average Number of Shares Outstanding - Diluted			170,017,715			171,540,139			169,990,150			171,043,667

See accompanying notes to the condensed consolidated interim financial statements

SILVERCORP METALS INC.

Condensed Consolidated Interim Statements of Comprehensive Income

(Unaudited) (Expressed in thousands of U.S. dollars)


			Three Months Ended September 30,						Six Months Ended September 30,
	Notes		2017			2016			2017			2016
Net income		$	14,602		$	16,006		$	28,116		$	22,526
Other comprehensive income (loss), net of taxes:
Items that may subsequently be reclassified to net income or loss:
Currency translation adjustment, net of tax of $nil			7,924			(1,230	)		14,143			(8,872	)
Share of other comprehensive loss in associate	3		(8	)		(49	)		(13	)		(73	)
Items that will not subsequently be reclassified to net income or loss:
Change in fair value on equity investments designated as FVTOCI, net of tax of $nil	4		715			(40	)		521			141
Other comprehensive income (loss), net of taxes		$	8,631		$	(1,319	)	$	14,651		$	(8,804	)
Attributable to:
Equity holders of the Company		$	7,587		$	(1,099	)	$	12,784		$	(7,222	)
Non-controlling interests	9		1,044			(220	)		1,867			(1,582	)
		$	8,631		$	(1,319	)	$	14,651		$	(8,804	)
Total comprehensive income, net of taxes		$	23,233		$	14,687		$	42,767		$	13,722

Attributable to:
Equity holders of the Company		$	18,732		$	11,279		$	34,866		$	9,830
Non-controlling interests			4,501			3,408			7,901			3,892
		$	23,233		$	14,687		$	42,767		$	13,722

See accompanying notes to the condensed consolidated interim financial statements

SILVERCORP METALS INC.

Condensed Consolidated Interim Statements of Cash Flows

(Unaudited) (Expressed in thousands of U.S. dollars)


			Three Months Ended September 30,						Six Months Ended September 30,
	Notes		2017			2016			2017			2016
Cash provided by
Operating activities
Net income		$	14,602		$	16,006		$	28,116		$	22,526
Add (deduct) items not affecting cash:
Finance costs	13		112			260			217			524
Depreciation, amortization and depletion			4,741			6,029			9,493			11,349
Share of loss (income) in associate	3		125			(269	)		369			(286	)
Gain on disposal of NSR	4		-			-			(4,320	)		-
Impairment of plant and equipment and mineral rights and properties			-			-			-			181
Income tax expense	14		5,263			5,938			9,284			8,738
Finance income	13		(650	)		(537	)		(1,224	)		(968	)
Loss (gain) on disposal of plant and equipment	5		6			(199	)		176			65
Share-based compensation	7		283			197			686			440
Income taxes paid			(3,445	)		(3,006	)		(7,582	)		(2,915	)
Interest received			650			537			1,224			968
Interest paid			-			(50	)		-			(101	)
Changes in non-cash operating working capital	18		(977	)		2,134			1,167			6,701
Net cash provided by operating activities			20,710			27,040			37,606			47,222

Investing activities
Mineral rights and properties
Capital expenditures			(5,022	)		(5,688	)		(10,933	)		(10,708	)
Plant and equipment
Additions			(1,520	)		(739	)		(2,731	)		(3,123	)
Proceeds on disposals	5		19			15			19			32
Other investments
Proceeds on disposals	6		-			33			-			33
Reclamation			(15	)		-			(19	)		(385	)
Investment in associate			(20,025	)		-			(20,025	)		-
Net purchases of short-term investments			(28,063	)		(1,995	)		(31,767	)		(5,976	)
Net cash used in investing activities			(54,626	)		(8,374	)		(65,456	)		(20,127	)

Financing activities
Non-controlling interests
Distribution	9		-			(1,460	)		(4,891	)		(1,460	)
Cash dividends distributed	7(c)		-			-			(1,679	)		-
Proceeds from issuance of common shares			165			82			168			297
Net cash provided by (used in) financing activities			165			(1,378	)		(6,402	)		(1,163	)
Effect of exchange rate changes on cash and cash equivalents			820			(406	)		2,618			(1,411	)

(Decrease) increase in cash and cash equivalents			(32,931	)		16,882			(31,634	)		24,521
Cash and cash equivalents, beginning of the period			74,300			49,602			73,003			41,963
Cash and cash equivalents, end of the period		$	41,369		$	66,484		$	41,369		$	66,484
Supplementary cash flow information	18

See accompanying notes to the condensed consolidated interim financial statements

SILVERCORP METALS INC.

Condensed Consolidated Interim Statements of Changes in Equity

(Unaudited) (Expressed in thousands of U.S. dollars, except numbers for share figures)


		Share capital
						Share					Accumulated other			Retained			Total equity attributable			Non-
		Number of				option					comprehensive			earnings			to the equity holders of			controlling
	Notes	shares		Amount		reserve			Reserves		loss			(deficit)			the Company			interests			Total equity
Balance, April 1, 2016		166,846,356	$	230,933	$	12,628		$	25,409	$	(35,994	)	$	562		$	233,538		$	53,021		$	286,559
Options exercised		219,221		397		(100	)		-		-			-			297			-			297
Share-based compensation		-		-		440			-		-			-			440			-			440
Distribution to non-controlling interests		-		-		-			-		-			-			-			(1,460	)		(1,460	)
Comprehensive (loss) income		-		-		-			-		(7,222	)		17,052			9,830			3,892			13,722
Balance, September 30, 2016		167,065,577	$	231,330	$	12,968		$	25,409	$	(43,216	)	$	17,614		$	244,105		$	55,453		$	299,558
Options exercised		824,059		825		(218	)		-		-			-			607			-			607
Share-based compensation		-		-		575			-		-			-			575			-			575
Dividends declared		-		-		-			-		-			(1,585	)		(1,585	)		-			(1,585	)
Distribution to non-controlling interests		-		-		-			-		-			-			-			(5,630	)		(5,630	)
Comprehensive (loss) income		-		-		-			-		(7,203	)		26,622			19,419			4,991			24,410
Balance, March 31, 2017		167,889,636	$	232,155	$	13,325		$	25,409	$	(50,419	)	$	42,651		$	263,121		$	54,814		$	317,935
Options exercised		304,618		231		(63	)		-		-			-			168			-			168
Share-based compensation	7(b)	-		-		686			-		-			-			686			-			686
Dividends declared	7(c)	-		-		-			-		-			(1,679	)		(1,679	)		-			(1,679	)
Comprehensive income		-		-		-			-		12,784			22,082			34,866			7,901			42,767
Balance, September 30, 2017		168,194,254	$	232,386	$	13,948		$	25,409	$	(37,635	)	$	63,054		$	297,162		$	62,715		$	359,877

See accompanying notes to the condensed consolidated interim financial statements

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


1.	CORPORATE INFORMATION

Silvercorp Metals Inc., along with its subsidiary companies (collectively the “Company”), is engaged in the acquisition, exploration, development, and mining of precious and base metal mineral properties. The Company’s producing mines and other current exploration and development projects are in China.

The Company is a publicly listed company incorporated in Canada with limited liability under the legislation of the Province of British Columbia. The Company’s shares are listed on the Toronto Stock Exchange and commencing May 15, 2017, on NYSE American Stock Exchange.

The head office, registered address and records office of the Company are located at 200 Granville Street, Suite 1378, Vancouver, British Columbia, Canada, V6C 1S4.

Operating results for the three and six months ended September 30, 2017, are not necessarily indicative of the results that may be expected for the year ending March 31, 2018.


2.	SIGNIFICANT ACCOUNTING POLICIES

(a) Statement of Compliance

These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 – Interim Financial Reporting (“IAS 34”) of the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). These condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended March 31, 2017. These condensed consolidated interim financial statements follow the same significant accounting policies set out in note 2 to the audited consolidated financial statements for the year ended March 31, 2017 except for narrow scope amendments to IAS 7 – Statement of Cashflows and IAS 12 – Income Taxes which were effective in the current year. These amendments had no material impact on the Company’s financial statements.

These condensed consolidated interim financial statements were authorized for issue in accordance with a resolution of the Board of Directors dated on November 7, 2017.

(b) Basis of Consolidation

These condensed consolidated interim financial statements include the accounts of the Company and its wholly or partially owned subsidiaries.

Subsidiaries are consolidated from the date on which the Company obtains control up to the date of the disposition of control. Control is achieved when the Company has power over the subsidiary, is exposed or has rights to variable returns from its involvement with the subsidiary; and has the ability to use its power to affect its returns.

For non-wholly-owned subsidiaries over which the Company has control, the net assets attributable to outside equity shareholders are presented as “non-controlling interests” in the equity section of the consolidated balance sheets. Net income for the period that is attributable to the non-controlling interests is calculated based on the ownership of the non-controlling interest shareholders in the

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

subsidiary. Adjustments to recognize the non-controlling interests’ share of changes to the subsidiary’s equity are made even if this results in the non-controlling interests having a deficit balance. Changes in the Company’s ownership interest in a subsidiary that do not result in a loss of control are recorded as equity transactions. The carrying amount of non-controlling interests is adjusted to reflect the change in the non-controlling interests’ relative interests in the subsidiary and the difference between the adjustment to the carrying amount of non-controlling interest and the Company’s share of proceeds received and/or consideration paid is recognized directly in equity and attributed to equity holders of the Company.

Balances, transactions, revenues and expenses between the Company and its subsidiaries are eliminated on consolidation.

Details of the Company’s significant subsidiaries which are consolidated are as follows:


			Proportion of ownership interest held
		Place of	September 30,	March 31,	Mineral
Name of subsidiaries	Principal activity	incorporation	2017	2017	properties
Silvercorp Metals China Inc.	Holding company	Canada	100%	100%
Silvercorp Metals (China) Inc.	Holding company	China	100%	100%
0875786 B.C. LTD.	Holding company	Canada	100%	100%
Fortune Mining Limited	Holding company	BVI (i)	100%	100%	RZY
Fortune Copper Limited	Holding company	BVI	100%	100%
Fortune Gold Mining Limited	Holding company	BVI	100%	100%
Victor Resources Ltd.	Holding company	BVI	100%	100%
Yangtze Mining Ltd.	Holding company	BVI	100%	100%
Victor Mining Ltd.	Holding company	BVI	100%	100%
Yangtze Mining (H.K.) Ltd.	Holding company	Hong Kong	100%	100%
Fortune Gold Mining (H.K.) Limited	Holding company	Hong Kong	100%	100%
Wonder Success Limited	Holding company	Hong Kong	100%	100%
Henan Huawei Mining Co. Ltd. ("Henan Huawei")	Mining	China	80%	80%	HPG, LM (ii)
Henan Found Mining Co. Ltd. ("Henan Found")	Mining	China	77.5%	77.5%	Ying, TLP (ii)
Songxian Gold Mining Co., Ltd. ("SX Gold")	Mining	China	77.5%	77.5%	XHP
Xinshao Yunxiang Mining Co., Ltd. ("Yunxiang")	Mining	China	70%	70%	BYP
Guangdong Found Mining Co. Ltd. (Guangdong Found")	Mining	China	95%	95%	GC
(i) British Virgin Island ("BVI")
(ii) Collectively as "Ying Mining District"


3.	INVESTMENT IN AN ASSOCIATE

New Pacific Metals Corp. (“NUAG”) is a Canadian public company listed on the TSX Venture Exchange (symbol: NUAG). NUAG is a related party of the Company by way of two common directors and officers.

As at September 30, 2017, the Company owned 35,830,700 common shares (March 31, 2017 – 10,806,300) of NUAG, representing an ownership interest of 31.8% (March 31, 2017 – 16.1%).

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

The Company accounts for its investment in NUAG common shares using the equity method as it is able to exercise significant influence over the financial and operating policies of NUAG. The summary of the investment in NUAG common shares and its market value as at the respective balance sheet dates are as follows:


						Value of NUAG's
	Number of					common shares per
	shares		Amount			quoted market price
Balance, April 1, 2016	10,806,300	$	3,133		$	2,333
Share of net income			282
Share of other comprehensive loss			(12	)
Impairment recovery			5,278
Foreign exchange impact			(164	)
Balance, March 31, 2017	10,806,300		8,517			8,517
Participate in Private placement	25,000,000		20,000
Purchase from open market	24,400		25
Share of net loss			(369	)
Share of other comprehensive loss			(13	)
Foreign exchange impact			1,364
Balance September 30 , 2017	35,830,700	$	29,524		$	38,759

Subsequent to period end, the Company purchased an additional 444,800 shares of NUAG from the open market for a total of $478.


4.	OTHER INVESTMENTS


		September 30, 2017		March 31, 2017

Equity investments designated as FVTOCI

Publicly-traded companies	$	6,489	$	1,207

Investments in publicly-traded companies with no significant influence

Investments in publicly-traded companies represent equity interests of other publicly-trading mining companies that the Company has acquired through the open market or through private placements. These equity interests are for long-term investment purposes and consist of common shares and warrants. As of September 30, 2017, none of the investments held by the Company represented more than 10% of the respective interest of investees.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

The continuity of such investments is as follow:


					Accumulated fair value change
		Fair value			included in OCI
April 1, 2016	$	287		$	(6,429	)
Change in fair value on equity investments designated as FVTOCI		196			196
Purchase of equity investments		782			-
Impact of foreign currency translation		(58	)		-
March 31, 2017	$	1,207		$	(6,233	)
Change in fair value on equity investments designated as FVTOCI		521			521
Equity investments received as consideration for disposal of NSR		4,320			-
Impact of foreign currency translation		441			-
September 30, 2017	$	6,489		$	(5,712	)

On April 5, 2017, the Company entered into a royalty purchase and sale agreement (the “Agreement”) with Maverix Metals Inc. (“Maverix”), a publicly traded (TSX-V: MMX) Canadian precious metals royalty and streaming company, to sell its 2.5% net smelter return (“NSR”) on the Silvertip Mine for consideration of up to 6,600,000 of Maverix’s common shares payable as follows:

3,800,000 common shares of Maverix on closing of the transaction; and
2,800,000 common shares of Maverix when the Silvertip Mine achieves (i) commercial production, and (ii) a cumulative throughput of 400,000 tonnes of ore through the processing plant.

On April 19, 2017, the transaction was closed and the Company received a total of 3,800,000 Maverix common shares valued at $4,320 (CAD$5.8 million) and recognized a gain of $4,320 on disposal of the NSR.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


5.	PLANT AND EQUIPMENT

Plant and equipment consist of:


																				Presentation
		Land use rights			Office						Motor			Construction						as Assets Held
Cost		and building			equipment			Machinery			vehicles			in progress			Total			for Sale
Balance as at April 1, 2016	$	91,162		$	6,442		$	27,255		$	7,103		$	9,075		$	141,037		$	-
Additions		1,748			215			850			300			1,656			4,769			-
Disposals		(267	)		(323	)		(321	)		(837	)		(3	)		(1,751	)		-
Reclassification of asset groups⁽¹⁾		7,841			-			318			-			(8,159	)		-			-
Impact of foreign currency translation		(6,000	)		(370	)		(1,750	)		(435	)		(426	)		(8,981	)		-
Balance as at March 31, 2017	$	94,484		$	5,964		$	26,352		$	6,131		$	2,143		$	135,074		$	-
Additions		436			209			513			291			311			1,760			-
Disposals		(148	)		(40	)		(110	)		(321	)		-			(619	)		-
Reclassification of asset groups⁽¹⁾		(48	)		-			4			-			44			-			-
Impact of foreign currency translation		3,413			507			664			187			82			4,853			-
Ending balance as at September 30, 2017	$	98,137		$	6,640		$	27,423		$	6,288		$	2,580		$	141,068		$	-

Impairment, accumulated depreciation and amortization
Balance as at April 1, 2016	$	(42,658	)	$	(4,693	)	$	(17,177	)	$	(5,407	)	$	(57	)	$	(69,992	)	$	-
Disposals		82			276			187			617			-			1,162			-
Depreciation and amortization		(2,893	)		(507	)		(1,674	)		(480	)		-			(5,554	)		-
Impact of foreign currency translation		2,763			258			1,144			342			4			4,511			-
Balance as at March 31, 2017	$	(42,706	)	$	(4,666	)	$	(17,520	)	$	(4,928	)	$	(53	)	$	(69,873	)		-
Disposals		37			35			68			284			-			424			-
Depreciation and amortization		(1,553	)		(200	)		(806	)		(189	)		-			(2,748	)		-
Impact of foreign currency translation		(1,555	)		(184	)		(643	)		(174	)		(2	)		(2,558	)		-
Ending balance as at September 30, 2017	$	(45,777	)	$	(5,015	)	$	(18,901	)	$	(5,007	)	$	(55	)	$	(74,755	)	$	-

Carrying amounts
Balance as at March 31, 2016	$	51,778		$	1,298		$	8,832		$	1,203		$	2,090		$	65,201		$	-
Ending balance as at September 30, 2017	$	52,360		$	1,625		$	8,522		$	1,281		$	2,525		$	66,313		$	-


Carrying amounts as at September 30, 2017		Ying Mining District		BYP		GC		Other		Total
Land use rights and building	$	35,544	$	2,506	$	13,221	$	1,089	$	52,360
Office equipment		1,254		47		160		164		1,625
Machinery		5,501		352		2,669		-		8,522
Motor vehicles		1,195		36		50		-		1,281
Construction in progress		660		1,859		-		6		2,525
Total	$	44,154	$	4,800	$	16,100	$	1,259	$	66,313

Carrying amounts as at March 31, 2017		Ying Mining District		BYP		GC		Other		Total
Land use rights and building	$	35,079	$	2,533	$	13,087	$	1,079	$	51,778
Office equipment		1,009		51		160		78		1,298
Machinery		5,817		372		2,643		-		8,832
Motor vehicles		1,138		44		21		-		1,203
Construction in progress		255		1,831		4		-		2,090
Total	$	43,298	$	4,831	$	15,915	$	1,157	$	65,201

During the three and six months ended September 30, 2017, certain plant and equipment were disposed for proceeds of $19 and $19, respectively (three and six months ended September 30, 2016 - $15 and $32, respectively) and loss of $6 and $176, respectively (three and six months ended September 30, 2016 – gain of $199 and loss of $65, respectively).

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


6.	MINERAL RIGHTS AND PROPERTIES

Mineral rights and properties consist of:


	Producing and development properties									Exploration and evaluation properties
Cost		Ying Mining District			BYP			GC			XHP			RZY			Total
Balance as at April 1, 2016	$	232,127		$	64,815		$	109,478		$	21,257		$	179		$	427,856
Capitalized expenditures		18,058			-			714			-			-			18,772
Mine right fee		1,337			-			-			-			-			1,337
Environmental rehabiliation		(1,448	)		(101	)		(57	)		-			-			(1,606	)
Foreign currecy translation impact		(15,227	)		(968	)		(6,933	)		(1,351	)		(5	)		(24,484	)
Balance as at March 31, 2017	$	234,847		$	63,746		$	103,202		$	19,906		$	174		$	421,875
Capitalized expenditures		10,185			-			211			36			-			10,432
Foreign currecy translation impact		8,535			501			3,705			708			12			13,461
Ending balance as at September 30, 2017	$	253,567		$	64,247		$	107,118		$	20,650		$	186		$	445,768

Impairment and accumulated depletion
Balance as at April 1, 2016	$	(55,524	)	$	(57,386	)	$	(77,609	)	$	(21,257	)	$	-		$	(211,776	)
Impairment loss		-			-			-			-			(181	)		(181	)
Depletion		(12,457	)		-			(1,869	)		-			-			(14,326	)
Foreign currecy translation impact		3,824			495			4,931			1,351			7			10,608
Balance as at March 31, 2017	$	(64,157	)	$	(56,891	)	$	(74,547	)	$	(19,906	)	$	(174	)	$	(215,675	)
Depletion		(6,260	)		-			(944	)		-			-			(7,204	)
Foreign currecy translation impact		(2,385	)		(258	)		(2,701	)		(707	)		(12	)		(6,063	)
Ending balance as at September 30, 2017	$	(72,802	)	$	(57,149	)	$	(78,192	)	$	(20,613	)	$	(186	)	$	(228,942	)

Carrying amounts
Balance as at March 31, 2017	$	170,690		$	6,855		$	28,655		$	-		$	-		$	206,200
Ending balance as at September 30, 2017	$	180,765		$	7,098		$	28,926		$	37		$	-		$	216,826


7.	SHARE CAPITAL

(a) Authorized

Unlimited number of common shares without par value. All shares issued as at September 30, 2017 were fully paid.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

(b) Stock options

The Company has a stock option plan which allows for the maximum number of common shares to be reserved for issuance on the exercise of options granted under the stock option plan to be a rolling 10% of the issued and outstanding common shares from time to time. The maximum exercise period may not exceed 10 years from the date of the grant of the options to employees, officers, and consultants. The following is a summary of option transactions:


			Weighted average
			exercise price per
	Number of shares		share CAD$
Balance, April 1, 2016	9,174,025	$	2.39
Options granted	1,173,000		3.77
Options exercised	(1,043,280)		1.13
Options forfeited	(847,238)		3.61
Options expired	(777,000)		8.92
Balance, March 31, 2017	7,679,507	$	1.97
Options exercised	(304,618)		0.70
Options forfeited	(10,000)		3.63
Options expired	(321,000)		5.87
Balance, September 30, 2017	7,043,889	$	1.85

For the three and six months ended September 30, 2017, a total of $283 and $686, respectively (three and six months ended September 30, 2016 - $197 and $440, respectively) in share-based compensation expense was recognized and included in the general and administrative expenses on the condensed consolidated interim statements of income.

The following table summarizes information about stock options outstanding at September 30, 2017:


			Weighted average
	Exercise	Number of options	remaining		Weighted average	Number of options		Weighted average
	price in	outstanding at	contractual life		exercise price in	exercisable at		exercise price in
	CAD$	September 30 2017	(Years)		CAD$	September 30,2017		CAD$
$	0.66	2,825,894	1.25	$	0.66	1,893,001		0.66
$	1.43	1,509,757	2.67	$	1.43	1,088,507		1.43
$	1.75	378,375	1.66	$	1.75	300,188		1.75
$	1.76	247,865	2.04	$	1.76	165,118		1.76
$	2.98	132,937	1.31	$	2.98	115,001		2.98
$	3.25	168,375	0.67	$	3.25	168,375		3.25
$	3.41	266,124	0.95	$	3.41	266,124		3.41
$	3.63	990,000	2.30	$	3.63	247,500		3.63
$	3.91	167,562	0.43	$	3.91	167,562		3.91
$	4.34	143,000	1.97	$	4.34	71,500		4.34
$	5.40	184,000	0.18	$	5.40	184,000		5.40
$	5.58	30,000	2.40	$	5.58	7,500		5.58
$	0.66 - 5.58	7,043,889	1.70	$	1.85	4,674,376	$	1.78

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

Subsequent to September 30, 2017, a total of 1,120,000 options with a life of three years were granted to directors, officers and employees at an exercise price of CAD$3.36 per share subject to a vesting schedule over a two-year term with 25% of the options vesting every six months from the date of grant.

(c) Cash dividends declared

During the three and six months ended September 30, 2017, dividends of $nil and $1,679, respectively (for three and six months ended September 30, 2016 - $nil and $nil, respectively) were declared and paid.


8.	ACCUMULATED OTHER COMPREHENSIVE INCOME


		September 30, 2017			March 31, 2017
Change in fair value on equity investments designated as FVTOCI	$	(37,365	)	$	(37,886	)
Share of other comprehensive loss in associate		(211	)		(198	)
Currency translation adjustment		(59	)		(12,335	)
Balance, end of the period	$	(37,635	)	$	(50,419	)

The unrealized loss on equity investments designated as FVTOCI, share of other comprehensive loss in associate and currency translation adjustment are net of tax of $nil for all periods presented.


9.	NON-CONTROLLING INTERESTS

The continuity of non-controlling interests is summarized as follows:


		Henan			Henan						Guangdong
		Found			Huawei			Yunxiang			Found			SX Gold			Total
Balance, April 1, 2016	$	51,596		$	4,231		$	4,197		$	(3,082	)	$	(3,921	)	$	53,021
Share of net income (loss)		11,247			756			(340	)		186			(25	)		11,824
Share of other comprehensive income (loss)		(2,703	)		(141	)		(193	)		48			48			(2,941	)
Distributions		(6,328	)		(762	)		-			-			-			(7,090	)
Balance, March 31, 2017	$	53,812		$	4,084		$	3,664		$	(2,848	)	$	(3,898	)	$	54,814
Share of net income (loss)		5,421			651			(169	)		180			(49	)		6,034
Share of other comprehensive income (loss)		1,655			176			80			(18	)		(26	)		1,867
Balance, September 30, 2017	$	60,888		$	4,911		$	3,575		$	(2,686	)	$	(3,973	)	$	62,715

As at September 30, 2017, non-controlling interests in Henan Found, Henan Huawei, Yunxiang, Guangdong Found and SX Gold were 22.5%, 20%, 30%, 5% and 22.5%, respectively.

Henan Non-ferrous Geology Minerals Ltd. (“Henan Non-ferrous”) is the 17.5% equity interest holder of Henan Found. During the three and six months ended September 30, 2017, Henan Found paid dividends of $nil and $3,804, respectively that was declared and accrued in the prior year to Henan Non-ferrous (three and six months ended September 30, 2016 – $1,460 and $1,460, respectively).

Henan Xinxiangrong Mining Ltd. (“Henan Xinxiangrong”) is the 5% equity interest holder of Henan Found. During the three and six months ended September 30, 2017, Henan Found paid dividends of $nil and $1,087, respectively that was declared and accrued in the prior year to Henan Xinxiangrong (three and six months ended September 30, 2016 – $nil and $nil, respectively).

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


10.	RELATED PARTY TRANSACTIONS

Related party transactions are made on terms agreed upon by the related parties. The balances with related parties are unsecured, non-interest bearing, and due on demand. Related party transactions not disclosed elsewhere in the condensed consolidated interim financial statements are as follows:

(a) Transactions with NUAG


Due from a related party		September 30, 2017		March 31, 2017
NUAG	$	59	$	92

According to a services and administrative costs reallocation agreement between the Company and NUAG, the Company recovers costs for services rendered to NUAG and expenses incurred on behalf of NUAG. During the three and six months ended September 30, 2017, the Company recovered $140 and $250, respectively (three and six months ended September 30, 2016 - $55 and $93, respectively) from NUAG for services rendered and expenses incurred on behalf of NUAG. The costs recovered from NUAG were recorded as a direct reduction of general and administrative expenses on the condensed consolidated interim statements of income.

(b) Transactions with key management personnel

The Company has identified its directors and senior officers as its key management personnel as they have authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly. The compensation costs for key management personnel, including the grant date fair value for options granted to key management personnel and fees paid or payable to company controlled by key management personnel, were as follows:


		Three Month ended September 30,				Six Month ended September 30,
		2017		2016		2017		2016
Salaries and bonuses	$	1,128	$	370	$	1,532	$	737
Share-based compensation		-		134		-		134
	$	1,128	$	504	$	1,532	$	871


11.	GENERAL AND ADMINISTRATIVE

General and administrative expenses consist of:


		Three months ended September 30,				Six months ended September 30,
General and administrative		2017		2016		2017		2016
Office and administrative expenses	$	1,784	$	1,275	$	2,992	$	2,695
Amortization and depreciation		300		309		580		666
Salaries and benefits		1,947		1,853		4,139		3,472
Share-based compensation		283		197		686		440
Professional fees		159		493		646		1,239
	$	4,473	$	4,127	$	9,043	$	8,512

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


12.	GOVERNMENT FEES AND OTHER TAXES

Government fees and other taxes consist of:


		Three months ended September 30,				Six months ended September 30,
		2017		2016		2017		2016
Government fees	$	19	$	122	$	274	$	1,176
Other taxes		671		609		1,257		1,250
	$	690	$	731	$	1,531	$	2,426

Government fees include environmental protection fees paid to the state and local Chinese government. Other taxes were composed of surtax on value-added tax, land usage levy, stamp duty and other miscellaneous levies, duties and taxes imposed by the state and local Chinese government.


13.	FINANCE ITEMS

Finance items consist of:


		Three months ended September 30,				Six months ended September 30,
Finance income		2017		2016		2017		2016
Interest income	$	650	$	537	$	1,224	$	968

		Three months ended September 30,				Six months ended September 30,
Finance costs		2017		2016		2017		2016
Interest on mine right fee	$	-	$	108	$	- $		216
Interest on bank loan		-		49		-		100
Unwinding of discount of environmental
rehabilitation provision		112		103		217		208
	$	112	$	260	$	217	$	524


14.	INCOME TAX

The significant components of income tax expense are as follows:


		Three months ended September 30,				Six months ended September 30,
Income tax expense		2017		2016		2017		2016
Current	$	4,516	$	4,894	$	7,743	$	5,606
Deferred		747		1,044		1,541		3,132
	$	5,263	$	5,938	$	9,284	$	8,738


15.	FINANCIAL INSTRUMENTS

The Company manages its exposure to financial risks, including liquidity risk, foreign exchange risk, interest rate risk, credit risk and equity price risk in accordance with its risk management framework. The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework and reviews the Company’s policies on an ongoing basis.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

(a) Fair value

The Company classifies its fair value measurements within a fair value hierarchy, which reflects the significance of the inputs used in making the measurements as defined in IFRS 13, Fair Value Measurement (“IFRS 13”).

Level 1 – Unadjusted quoted prices at the measurement date for identical assets or liabilities in active markets.

Level 2 – Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Unobservable inputs which are supported by little or no market activity.

The following tables set forth the Company’s financial assets and liabilities that are measured at fair value level on a recurring basis within the fair value hierarchy at September 30, 2017 and March 31, 2017 that are not otherwise disclosed. As required by IFRS 13, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.


	Fair value as at September 30, 2017
Recurring measurements		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	41,369	$	-	$	-	$	41,369
Investments in publicly traded companies		6,489		-		-		6,489

	Fair value as at March 31, 2017
Recurring measurements		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	73,003	$	-	$	-	$	73,003
Investments in publicly traded companies		1,207		-		-		1,207

Fair value of the other financial instruments excluded from the table above approximates their carrying amount as of September 30, 2017 and March 31, 2017, respectively, due to the short-term nature of these instruments.

There were no transfers into or out of level 3 during the three and six months ended September 30, 2017 and 2016.

(a) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its short-term business requirements. The Company has in place a planning and budgeting process to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis and its expansion plans.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

In the normal course of business, the Company enters into contracts that give rise to commitments for future minimum payments. The following summarizes the remaining contractual maturities of the Company’s financial liabilities.


		September 30, 2017								March 31, 2017
		Within a year		2-3 years		4-5 years		Total		Total
Accounts payable and accrued liabilities	$	24,705	$	-	$	-	$	24,705	$	30,374

(b) Foreign exchange risk

The Company reports its financial statements in US dollars. The functional currency of the head office, Canadian subsidiaries and all intermediate holding companies is CAD and the functional currency of all Chinese subsidiaries is RMB. The Company is exposed to foreign exchange risk when the Company undertakes transactions and holds assets and liabilities in currencies other than its functional currencies.

The Company currently does not engage in foreign exchange currency hedging. The Company's exposure to currency risk affect net income is summarized as follow:


		September 30, 2017		March 31, 2017
Financial assets denominated in U.S. Dollars	$	26,202	$	29,093
Financial assets denominated in Chinese RMB	$	1	$	7,115

As at September 30, 2017, with other variables unchanged, a 10% strengthening (weakening) of the CAD against the USD would have decreased (increased) net income by approximately $2.6 million.

(c) Interest rate risk

The Company is exposed to interest rate risk on its cash equivalents and short-term investments. As at September 30, 2017, all of its interest-bearing cash equivalents and short-term investments earn interest at market rates that are fixed to maturity or at variable interest rate with terms of less than one year. The Company monitors its exposure to changes in interest rates on cash equivalents and short-term investments. Due to the short-term nature of the financial instruments, fluctuations in interest rates would not have a significant impact on the Company’s after-tax net income.

(d) Credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company is exposed to credit risk primarily associated to accounts receivable, due from related parties, cash and cash equivalents and short-term investments. The carrying amount of assets included on the balance sheet represents the maximum credit exposure.

The Company undertakes credit evaluations on counterparties as necessary, requests deposits from customers prior to delivery, and has monitoring processes intended to mitigate credit risks. The Company has trade receivables from time to time from its major customers primarily in China engaged in the mining and milling of base and polymetallic metals. The historical level of customer default is zero and aging of trade receivables are no more than 180 days, and, as a result, the credit risk associated with trade receivables from customers as at September 30, 2017 is considered to be immaterial. There were no

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

amounts in receivables which were past due at September 30, 2017 (at March 31, 2017 - $nil) for which no provision is recognized.

(e) Equity price risk

The Company holds certain marketable securities that will fluctuate in value as a result of trading on Canadian financial markets. As the Company’s marketable securities holding are mainly in mining companies, the value will also fluctuate based on commodity prices. Based upon the Company’s portfolio at September 30, 2017, a 10% increase (decrease) in the market price of the securities held, ignoring any foreign currency effects would have resulted in an increase (decrease) to comprehensive income of approximately $0.65 million.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


16.	SEGMENTED INFORMATION

The Company's reportable operating segments are components of the Company where separate financial information is available that is evaluated regularly by the Company’s Chief Executive Officer who is the Chief Operating Decision Maker (“CODM”). The operational segments are determined based on the Company’s management and internal reporting structure. Operating segments are summarized as follows:


Operational Segments	Subsidiaries Included in the Segment	Properties Included in the Segment
Mining
Henan Luoning	Henan Found and Henan Huawei	Ying Mining District
Hunan	Yunxiang	BYP
Guangdong	Guangdong Found	GC
Other	SX Gold and 0875786 B.C. Ltd.	XHP
Administrative
Vancouver	Silvercorp Metals Inc. and BVI's holding companies	RZY
Beijing	Silvercorp Metals (China) Inc.

(a) Segmented information for assets and liabilities are as follows:


September 30, 2017
	Mining								Administrative					Total
Statement of financial position items:		Luoning		Hunan	Guangdong			Other		Beijing		Vancouver		Total

Current assets	$	73,752	$	1,681	$	9,590	$	653	$	570	$	28,283	$	114,529
Plant and equipment		44,154		4,800		16,100		4		1,081		174		66,313
Mineral rights and properties		180,765		7,098		28,926		37		-		-		216,826
Investment in an associate		-		-		-		-		-		29,524		29,524
Other investments		-		-		-		5,329		-		1,160		6,489
Reclamation deposits		5,083		-		151		-		-		8		5,242
Long-term prepaids and deposits		448		102		210		147		-		-		907
Total assets	$	304,202	$	13,681	$	54,977	$	6,170	$	1,651	$	59,149	$	439,830

Current liabilities	$	25,864	$	1,569	$	5,000	$	2,874	$	204	$	1,374	$	36,885
Mine right fee payable		-		-		-		-		-		-		-
Deferred income tax liabilities		29,355		886		-		-		-		-		30,241
Environmental rehabilitation		10,716		967		857		287		-		-		12,827
Total liabilities	$	65,935	$	3,422	$	5,857	$	3,161	$	204	$	1,374	$	79,953

March 31, 2017
	Mining								Administrative					Total
Statement of financial position items:		Luoning		Hunan		Guangdong		Other		Beijing		Vancouver		Total

Current assets	$	64,298	$	1,869	$	4,796	$	523	$	823	$	38,523	$	110,832
Plant and equipment		43,297		4,832		15,915		-		1,081		76		65,201
Mineral rights and properties		170,690		6,855		28,655		-		-		-		206,200
Investment in an associate		-		-		-		-		-		8,517		8,517
Other investments		-		-		-		-		-		1,207		1,207
Reclamation deposits		4,901		-		145		-		-		8		5,054
Long-term prepaids and deposits		432		99		306		122		-		-		959
Total assets	$	283,618	$	13,655	$	49,817	$	645	$	1,904	$	48,331	$	397,970

Current liabilities	$	29,951	$	1,425	$	3,860	$	2,959	$	184	$	1,778	$	40,157
Mine right fee payable		-		-		-		-		-		-		-
Deferred income tax liabilities		26,846		846		-		-		-		-		27,692
Environmental rehabilitation		10,183		918		813		272		-		-		12,186
Total liabilities	$	66,980	$	3,189	$	4,673	$	3,231	$	184	$	1,778	$	80,035

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

(b)Segmented information for operating results are as follows:


Three months ended September 30, 2017
					Mining									Administrative
		Henan																		Total
Statement of operations:		Luoning			Hunan⁽¹⁾			Guangdong			Other			Beijing			Vancouver
Sales	$	40,536		$	-		$	7,005		$	-		$	-		$	-		$	47,541
Cost of sales		(17,716	)		-			(4,219	)		-			-			-			(21,935	)
Gross profit		22,820			-			2,786			-			-			-			25,606

Operating expenses		(1,828	)		(368	)		(576	)		(142	)		(357	)		(3,008	)		(6,279	)
Finance items		75			(20	)		2			(4	)		66			419			538
Income tax (expenses) recovery		(5,269	)		7			-			-			(1	)		-			(5,263	)
Net income (loss)	$	15,798		$	(381	)	$	2,212		$	(146	)	$	(292	)	$	(2,589	)	$	14,602

Attributed to:
Equity holders of the Company		12,298			(267	)		2,109			(114	)		(292	)		(2,589	)		11,145
Non-controlling interests		3,500			(114	)		103			(32	)		-			-			3,457
Net income (loss)	$	15,798		$	(381	)	$	2,212		$	(146	)	$	(292	)	$	(2,589	)	$	14,602
⁽¹⁾Hunan's BYP project was placed on care and maintenance starting August 2014;

Three months ended September 30, 2016
					Mining									Administrative
		Henan																		Total
Statement of operations:		Luoning			Hunan			Guangdong			Other			Beijing			Vancouver
Sales	$	39,954		$	-		$	6,344		$	-		$	-		$	-		$	46,298
Cost of sales		(16,420	)		-			(4,119	)		-			-			-			(20,539	)
Gross profit		23,534			-			2,225			-			-			-			25,759

Operating expenses		(1,751	)		(187	)		(524	)		(23	)		(331	)		(1,276	)		(4,092	)
Finance items		(3	)		(7	)		(2	)		(2	)		66			225			277
Income tax expenses		(5,386	)		(22	)		-			-			-			(530	)		(5,938	)
Net income (loss)	$	16,394		$	(216	)	$	1,699		$	(25	)	$	(265	)	$	(1,581	)	$	16,006

Attributed to:
Equity holders of the Company		12,770			(151	)		1,624			(19	)		(265	)		(1,581	)		12,378
Non-controlling interests		3,624			(65	)		75			(6	)		-			-			3,628
Net income (loss)	$	16,394		$	(216	)	$	1,699		$	(25	)	$	(265	)	$	(1,581	)	$	16,006

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


Six months ended September 30, 2017
	Mining												Administrative
		Henan																		Total
Statement of income:		Luoning			Hunan⁽¹⁾			Guangdong			Other			Beijing			Vancouver
Sales	$	72,293		$	-		$	14,945		$	-		$	-		$	-		$	87,238
Cost of sales		(31,838	)		-			(9,789	)		-			-			-			(41,627	)
Gross profit		40,455			-			5,156			-			-			-			45,611

Operating (expenses) income		(3,842	)		(516	)		(1,238	)		4,107			(619	)		(7,110	)		(9,218	)
Finance items, net		63			(39	)		(1	)		(5	)		130			859			1,007
Income tax expenses		(9,273	)		(10	)		-			-			(1	)		-			(9,284	)
Net income (loss)	$	27,403		$	(565	)	$	3,917		$	4,102		$	(490	)	$	(6,251	)	$	28,116

Attributable to:
Equity holders of the Company		21,331			(396	)		3,737			4,151			(490	)		(6,251	)		22,082
Non-controlling interests		6,072			(169	)		180			(49	)		-			-			6,034
Net income (loss)	$	27,403		$	(565	)	$	3,917		$	4,102		$	(490	)	$	(6,251	)	$	28,116
⁽¹⁾Hunan's BYP project was placed on care and maintenance in August 2014;

Six months ended September 30, 2016
	Mining												Administrative
		Henan																		Total
Statement of income:		Luoning			Hunan			Guangdong			Other			Beijing			Vancouver
Sales	$	70,626		$	-		$	10,943		$	-		$	-		$	-		$	81,569
Cost of sales		(32,134	)		-			(7,932	)		-			-			-			(40,066	)
Gross profit		38,492			-			3,011			-			-			-			41,503

Operating expenses		(5,090	)		(429	)		(1,158	)		(58	)		(729	)		(3,038	)		(10,502	)
Impairment loss		-			-			-			-			-			(181	)		(181	)
Finance items, net		(85	)		(15	)		2			(4	)		141			405			444
Income tax (expenses) recovery		(8,279	)		72			-			-			(1	)		(530	)		(8,738	)
Net income (loss)	$	25,038		$	(372	)	$	1,855		$	(62	)	$	(589	)	$	(3,344	)	$	22,526

Attributable to:
Equity holders of the Company		19,511			(260	)		1,782			(48	)		(589	)		(3,344	)		17,052
Non-controlling interests		5,527			(112	)		73			(14	)		-			-			5,474
Net income (loss)	$	25,038		$	(372	)	$	1,855		$	(62	)	$	(589	)	$	(3,344	)	$	22,526

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

The sales generated for the three and six months ended September 30, 2017 and 2016 was all earned in China and is comprised of:


	Three months ended September 30, 2017
		Henan Luoning		Guangdong		Total
Silver (Ag)	$	20,928	$	1,668	$	22,596
Gold (Au)		857		-		857
Lead (Pb)		16,036		1,769		17,805
Zinc (Zn)		2,528		3,558		6,086
Other		187		10		197
	$	40,536	$	7,005	$	47,541

	Three months ended September 30, 2016
		Henan Luoning		Guangdong		Total
Silver (Ag)	$	24,923	$	2,051	$	26,974
Gold (Au)		1,087		-		1,087
Lead (Pb)		12,684		1,459		14,143
Zinc (Zn)		1,260		2,833		4,093
Other		-		1		1
	$	39,954	$	6,344	$	46,298

	Six months ended September 30, 2017
		Henan Luoning		Guangdong		Total
Silver (Ag)	$	39,132	$	3,647	$	42,779
Gold (Au)		1,816		-		1,816
Lead (Pb)		27,683		3,570		31,253
Zinc (Zn)		3,267		7,500		10,767
Other		395		228		623
	$	72,293	$	14,945	$	87,238

	Six months ended September 30, 2016
		Henan Luoning		Guangdong		Total
Silver (Ag)	$	44,289	$	3,522	$	47,811
Gold (Au)		1,959		-		1,959
Lead (Pb)		22,065		2,571		24,636
Zinc (Zn)		2,313		4,739		7,052
Other		-		111		111
	$	70,626	$	10,943	$	81,569

(d) Major customers

For the six months ended September 30, 2017, three major customers (six months ended September 30, 2016 - three) accounted for 15% to 33%, (six months ended September 30, 2016 - 17% to 35%) and collectively 79% (six months ended September 30, 2016 - 82%) of the total sales of the Company.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)


17.	COMMITMENTS AND CONTINGENCIES

Commitments, not disclosed elsewhere in these financial statements, are as follows:


		Total		Less than 1 year		1-5 years		After 5 years
Operating leases	$	3,772	$	566	$	3,206	$	-
Commitments	$	6,418	$	-	$	-	$	6,418

As of September 30, 2017, the Company has two office rental agreements totaling $3,772 for the next five years and commitments of $6,418 related to the GC property. During the three and six months ended September 30, 2017, the Company incurred rental expenses of $167 and $325, respectively (three and six months ended September 30, 2016 - $148 and $300, respectively), which were included in office and administrative expenses on the condensed consolidated interim statement of income.

Although the Company has taken steps to verify title to properties in which it has an interest, these procedures do not guarantee the Company's title. Property title may be subject to, among other things, unregistered prior agreements or transfers and may be affected by undetected defects.

Due to the size, complexity and nature of the Company’s operations, the Company is subject to various claims, legal and tax matters arising in the ordinary course of business. Each of these matters is subject to various uncertainties and it is possible that some of these matters may be resolved unfavorably to the Company. The Company accrues for such items when a liability is both probable and the amount can be reasonably estimated.

In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company and its legal counsel evaluate the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. Major legal proceedings against the Company are summarized as follows:

On August 19, 2014, an action was commenced against the Company in the Supreme Court of British Columbia seeking an unspecified amount of damages for a claim of false imprisonment and defamation (the “Huang Action”). The Company believes that there is no merit to the allegations and intends to pursue a vigorous defence.
During the year ended March 31, 2016, an action was initiated by Luoyang Mining Group Co., Ltd. (“Luoyang Mining”) against Henan Found seeking payment of $1.6 million (RMB10.0 million) plus interest related to the acquisition agreements Henan Found entered into in August 2012 to acquire the XHP Mine. The $1.6 million has been included into the accounts payable and accrued liabilities on the condensed consolidated interim statements of financial position of the Company. Henan Found did not make the final payment as certain commercial conditions were not fulfilled by Luoyang Mining. In April 2016, Henan Found filed a counter claim in Luoyang People’s Court against Luoyang Mining to have the original acquisition agreements nullified and is seeking repayment of the amount paid to date of $9.7 million (RMB62.8 million) plus compensation of direct loss of $2.5 million (RMB16.5 million) arising from XHP mine. A trial was heard in March 2017 but a court decision has not yet been made. The carrying value of XHP mine was impaired to $nil in fiscal year 2015.

SILVERCORP METALS INC.

Notes to Condensed Consolidated Interim Financial Statements as at September

30, 2017 and for three and six months ended September 30, 2017 and 2016

(Unaudited)(Expressed in thousands of U.S. dollars, unless otherwise stated)

During the year ended March 31, 2016, SX Gold, a 100% owned subsidiary of Henan Found, commenced a legal action against Luoyang HA Mining Co. Ltd. (“HA Mining”) to seek payment of $4.0 million (RMB26.0 million) plus interest related to a share transfer agreement that SX Gold entered into with HA Mining in September 2013. Pursuant to the agreement, SX Gold was to transfer all shares it held in Songxian Zhongxin Mining Co. Ltd. to HA Mining for $11.8 million (RMB76.0 million).
SX Gold fulfilled its responsibilities and the title of the shares was transferred to HA Mining, who paid $7.8 million (RMB50.0 million). The remaining $4.0 million (RMB26.0 million) was not paid. In April 2016, HA Mining filed a counter claim for $2.2 million (RMB14.0 million). On June 17, 2016, the court issued an order in favor of SX Gold. The Luoyang Intermediate People’s Court, Henan, China issued an court order demanding HA Mining to pay $3.4 million (RMB22.75 million) to SX Gold. On July 1, 2016, HA Mining filed an appeal to the Henan High People’s Count, China. A trial was heard in April 2017 and on June 16, 2017, the Henan High People’s Court, China dismissed HA Mining’s appeal and upheld the rulings made by the Luoyang Intermediate People’s Court, Henan, China. On August 4, 2017, HA Mining submitted an application to the Supreme People’s Court of China to rehear the case. As of September 30, 2017, no decision has been made by the Supreme People’s Court of China. The outstanding receivable amount of $4.0 million (RMB26.0 million) was written off in prior years.


18.	SUPPLEMENTARY CASH FLOW INFORMATION


		September 30, 2017		March 31, 2017
Cash on hand and at bank	$	31,918	$	39,243
Bank term deposits and GICs		9,451		33,760
Total cash and cash equivalents	$	41,369	$	73,003


Changes in non-cash operating working capital:		Three Months Ended September 30,						Six Months Ended September 30,
		2017			2016			2017			2016
Trade and other receivables	$	(4	)	$	865		$	64		$	789
Inventories		(30	)		(373	)		(429	)		(479	)
Prepaids and deposits		(311	)		363			(214	)		(230	)
Accounts payable and accrued liabilities		(1,596	)		1,256			(110	)		4,788
Deposits received		983			58			1,819			1,951
Due from a related party		(19	)		(35	)		37			(118	)
	$	(977	)	$	2,134		$	1,167		$	6,701