2023 Sales and Corporate AISC Beat Guidance, Driving
TSX: SIL | NYSE American: SILV
________________________________ |
1 Based on company filing for the period ended |
Q4, 2023
- Recovered 14,100 ounces ("oz") of gold ("Au") and 1.34 million oz of silver ("Ag"), or 2.47 million oz of silver equivalent ("AgEq"2).
- Sold 16,100 oz of Au and 1.28 million oz of Ag, or 2.56 million oz of AgEq.
- Cash costs of
$7.45 per oz AgEq sold and Corporate AISC of$14.36 per oz AgEq sold, which was within the H2, 2023 guidance range of$13.75 to$15.50 per oz AgEq sold, but higher than Q3, 2023, primarily due to an increase in capital spend and payments to our outgoing mining contractor. - Average realized price of
$1,979 /oz Au and$23.09 /oz Ag. - Revenue of
$61.3 million and cost of sales of$24.4 million , resulting in mine operating earnings of$36.9 million , which represents a 60% operating margin. - Net earnings of
$35.9 million or basic earnings of$0.25 per share. - Free cash flow of
$24.1 million or$0.16 per share. - Ended the quarter with treasury assets totaling
$105.2 million ($86.0 million cash and$19.2 million in bullion), a$23.4 million or 29% increase from the prior quarter.
Year ended
- Recovered 59,700 oz of Au and 5.65 million oz of Ag, or 10.40 million oz of AgEq.
- Sold 58,200 oz of Au and 5.62 million oz of Ag, or 10.25 million oz of AgEq, exceeding 2023 sales guidance of 9.8 to 10.2 million oz of AgEq.
- Cash costs of
$7.73 per oz AgEq sold was within the guidance range of$7.50 to$8.50 per oz AgEq sold. - AISC of
$12.58 per oz AgEq sold beat the low end of the 2023 guidance range of$12.75 to$13.75 per oz AgEq sold. - Average realized price of
$1,946 /oz Au and$23.48 /oz Ag. - Revenue of
$245.1 million and cost of sales of$96.8 million , resulting in mine operating income of$148.3 million , which represents a 61% operating margin. - Net earnings of
$116.7 million or basic earnings of$0.79 per share. - Free cash flow of
$121.1 million or$0.82 per share. - Financial position remained strong with no debt and treasury assets totaling
$105.2 million ($86.0 million cash and$19.2 million in bullion), a$54.4 million or 107% increase from the prior year. - Fully repaid the
$50.0 million Term Facility. - Repurchased
$7.1 million of the Company's shares under SilverCrest's Normal Course Issuer Bid ("NCIB"), representing 20% of the allowable 7.4 million common share purchase limit.
_____________________________ |
2 Silver equivalent ("AgEq") ratio used in this news release of 79.51:1 based on the updated technical report for Las Chispas titled "Las Chispas Operation Technical Report" dated |
2024 Outlook
The Las Chispas underground operation will continue its ramp-up through 2024 with mining rates expected to remain at or around Q4, 2023 levels in H1, 2024, as the new mining contractor mobilizes. Mining rates will increase in H2, 2024 with a targeted exit rate of 1,050 tonnes per day ("tpd"). The mine plan was created with a measured ramp-up, which when combined with balanced usage of surface stockpiles, reduces execution risk. The new mining contractor, a subsidiary of
In 2024, the processing plant will operate at an average of 1,200 tpd, except in Q1, 2024, due to planned maintenance downtime in
The Company announced its full year 2024 guidance on
Guidance Metric | Unit | 2024 |
AgEq Ounces Sold | millions | 9.8 to 10.2 |
Cash Costs(1) | $/oz AgEq sold | 9.50 to 10.00 |
Corporate AISC(1) | $/oz AgEq sold | 15.00 to 15.90 |
Sustaining Capital(1) | $ millions | 40.0 to 44.0 |
Exploration | $ millions | 12.0 to 14.0 |
Notes: | ||||
1. | Cash Costs, AISC, and sustaining capital are non-GAAP measures. Please refer to the Non-GAAP Financial Measures section of this news release for further information on this measure. | |||
2 | General assumptions: a. Metal prices estimated at b. Annual average exchange rate from all costs based on Mexican peso to US dollar of 17:1. |
Estimated 2024 Corporate AISC of
In Q1, 2024 SilverCrest expects to make payments totaling approximately
In 2024, cash flows are also expected to be impacted by mobilization and demobilization costs, including a
Fourth Quarter and Annual Operating Performance
The following operating performance refers to free cash flow, cash costs, AISC, treasury assets and net cash which are described in more detail in the "Non-GAAP Financial Measures" section of this news release.
OPERATIONAL | Unit | Q4, 2023 | Q4, 2022 | 2023 | 2022 |
Ore mined | tonnes | 78,600 | 64,700 | 300,900 | 201,000 |
Ore milled(a) | tonnes | 104,500 | 104,400 | 431,400 | 187,600 |
Average daily mill throughput | tpd | 1,136 | 1,135 | 1,182 | 877 |
Underground development | km | 3.6 | 2.3 | 13.2 | 8.1 |
Gold | |||||
Average grade | gpt | 4.28 | 3.67 | 4.39 | 3.05 |
Recovery | % | 98.3 % | 96.9 % | 98.1 % | 96.5 % |
Recovered | oz | 14,100 | 11,940 | 59,700 | 17,770 |
Sold | oz | 16,100 | 11,400 | 58,200 | 11,400 |
Silver | |||||
Average grade | gpt | 410 | 382 | 423 | 312 |
Recovery | % | 97.7 % | 93.3 % | 96.5 % | 92.5 % |
Recovered | million oz | 1.34 | 1.20 | 5.65 | 1.74 |
Sold | million oz | 1.28 | 0.98 | 5.62 | 1.12 |
Silver equivalent(b) | |||||
Average grade | gpt | 750 | 674 | 771 | 555 |
Recovery | % | 98.0 % | 94.7 % | 97.2 % | 94.2 % |
Recovered | million oz | 2.47 | 2.15 | 10.40 | 3.16 |
Sold | million oz | 2.56 | 1.89 | 10.25 | 2.03 |
(a) | Ore milled includes material from stockpiles and ore mined. | |||||
(b) | Q4, 2022 and 2022 AgEq figures were originally presented using a Ag:Au ratio of 86.9:1 but have been recast for consistency with the ratio of 79.51:1 being applied to current year figures based on the 2023 Technical Report. |
FINANCIAL | Unit | Q4, 2023 | Q4, 2022 | 2023 | 2022 |
Revenue | $ millions | $ 61.3 | $ 40.8 | $ 245.1 | $ 43.5 |
Cost of sales | $ millions | $ (24.4) | $ (14.3) | $ (96.8) | $ (15.1) |
Mine operating income | $ millions | $ 36.9 | $ 26.5 | $ 148.3 | $ 28.4 |
Earnings for the period | $ millions | $ 35.9 | $ 5.2 | $ 116.7 | $ 31.3 |
Earnings per share (basic) | $/share | $ 0.25 | $ 0.03 | $ 0.79 | $ 0.21 |
Free cash flow | $ millions | $ 24.1 | N/A* | $ 121.1 | N/A* |
Cash costs | $/oz AgEq | $ 7.45 | N/A* | $ 7.73 | N/A* |
AISC | $/oz AgEq | $ 14.36 | N/A* | $ 12.58 | N/A* |
Units | As at | As at | |||
Cash and cash equivalents | $ millions | $ 86.0 | $ 50.8 | ||
Bullion | $ millions | $ 19.2 | $ — | ||
$ millions | $ 105.2 | $ 50.8 | |||
Credit Facility Debt | $ millions | $ — | $ 49.6 | ||
Net cash | $ millions | $ 86.0 | $ 1.2 |
* This information was not available for 2022. |
Underground
Mining rates in Q4, 2023 averaged 855 tpd, a 6% decrease from Q3, 2023, but in line with the ramp-up estimate of 800 to 900 tpd. Rates decreased over the previous quarter as a result of a focus on dilution management. During 2023, mining rates averaged 824 tpd.
In Q4, 2023, the Company completed 3.6 km of horizontal and vertical underground development. In 2023, the Company completed an additional 13.2 km of horizontal and vertical underground development, compared to 8.0 km in 2022.
Processing Plant
Average daily mill throughput was 1,136 tpd in Q4, 2023 and 1,182 tpd in 2023. Q4, 2023 throughput declined slightly from Q3, 2023 throughput of 1,245 tpd as the processing plant experienced some unplanned downtime.
Average processed gold and silver grades of 4.28 gpt Au and 410 gpt Ag, or 750 gpt AgEq, in Q4, 2023 were in line with Q3, 2023 (2% and 1% declines respectively). In 2023, gold and silver processed grades averaged 4.39 gpt Au and 423 gpt Ag, or 771 gpt AgEq.
Costs
During the quarter, cash costs averaged
AISC averaged
Sustaining Capital Expenditures
Sustaining capital expenditures totalled
Exploration Update
During 2023, the Company completed exploration work at Las Chispas, which is capitalized as growth capital.
During Q4, 2023, 17,947 metres of drilling was completed at Las Chispas, with 42% of the metres focused on infill drilling of Inferred Resources (see 2023 Technical Report) for conversion to Indicated Resources and possible conversion to Reserves. The balance of the drilling was focused on new vein targets. In Q4, 2023, the Company spent
During 2023, 50,233 metres of drilling was completed and
Selected Fourth Quarter Financial Results
Fourth Quarter and Annual Consolidated Income Statements
(unaudited, in thousands of USD)
Three months ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Revenue | $ 61,320 | $ 40,791 | $ 245,130 | $ 43,510 |
Cost of sales | ||||
Production costs | (17,555) | (13,006) | (74,108) | (13,758) |
Depreciation | (6,328) | (1,073) | (21,348) | (1,116) |
Royalties | (490) | (216) | (1,368) | (216) |
(24,373) | (14,295) | (96,824) | (15,090) | |
Mine operating earnings | 36,947 | 26,496 | 148,306 | 28,420 |
General and administrative expenses | (6,534) | (4,365) | (15,756) | (9,746) |
Exploration and project expenses | (99) | (775) | (726) | (5,444) |
Foreign exchange gains (losses) | 630 | (4,493) | (7,247) | 27,913 |
Earnings from operations | 30,944 | 16,863 | 124,577 | 41,143 |
Interest income | 1,448 | 886 | 4,035 | 2,811 |
Interest and finance expense | (334) | (6,397) | (2,713) | (6,589) |
Other expense | 507 | — | (2,653) | — |
Earnings before income taxes | 32,565 | 11,352 | 123,246 | 37,365 |
Income tax expense | 3,352 | $ (6,121) | (6,526) | $ (6,064) |
Net earnings | 35,917 | 5,231 | 116,720 | 31,301 |
Other comprehensive income | ||||
Currency translation adjustment | — | 5,399 | 10,255 | (27,987) |
Total comprehensive earnings | $ 35,917 | $ 10,630 | $ 126,975 | $ 3,314 |
Net earnings attributable to common shareholders | ||||
Basic earnings per share | $ 0.25 | $ 0.03 | $ 0.79 | $ 0.21 |
Diluted earnings per share | $ 0.24 | $ 0.04 | $ 0.79 | $ 0.21 |
Weighted average shares outstanding (in 000's) Basic | 146,334 | 146,646 | 146,882 | 146,164 |
Weighted average shares outstanding (in 000's) Diluted | 146,972 | 152,403 | 147,539 | 152,190 |
Revenue
During Q4, 2023, the Company sold a total of 16,100 oz Au and 1.28 million oz Ag at average realized prices of
During 2023, the Company sold a total of 58,200 oz Au and 5.62 million oz Ag at average realized prices of
Income
Q4, 2023 net earnings of
During 2023, the Company generated net earnings of
Fourth Quarter and Annual Consolidated Statements of Cash Flows
(unaudited, in thousands of USD)
Three months ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Operating activities | ||||
Net earnings for the year | $ 35,917 | $ 5,231 | $ 116,720 | $ 31,301 |
Income tax (recovery) expense | (3,352) | 6,121 | 6,526 | 6,064 |
Depreciation | 5,957 | 1,894 | 21,348 | 1,937 |
Share-based compensation expense | 2,333 | 1,391 | 4,190 | 2,398 |
Unrealized foreign exchange losses | 842 | 3,579 | 7,942 | (21,868) |
Interest income | (1,448) | (886) | (4,035) | (2,811) |
Interest expense | (4,010) | 6,374 | 1,461 | 6,566 |
Interest paid | 190 | (1,619) | (1,461) | (7,568) |
Interest received | 1,251 | 974 | 4,035 | 2,715 |
Income taxes paid | 10 | — | (977) | — |
Other operating activities | (242) | — | (242) | — |
Net change in non-cash working capital items | (1,352) | (3,630) | 2,754 | (28,644) |
$ 36,096 | $ 19,429 | $ 158,261 | $ (9,910) | |
Investing activities | ||||
Payments for mineral properties, plant and equipment | (17,327) | (16,409) | (51,257) | (68,489) |
Purchase of bullion | (6,655) | — | (18,674) | — |
Proceeds from derivatives | 264 | — | 264 | — |
$ (23,718) | $ (16,409) | $ (69,667) | $ (68,489) | |
Financing activities | ||||
Common share proceeds | 2,878 | 1,084 | 3,131 | 2,467 |
Common share repurchases | (6) | — | (7,145) | — |
Proceeds from debt | — | 49,583 | — | 49,583 |
Repayment of debt | — | (92,860) | (50,000) | (92,860) |
Payments of equipment leases | (30) | (39) | (112) | (159) |
$ 2,842 | $ (42,232) | $ (54,126) | $ (40,969) | |
Effects of exchange rate changes on cash and cash equivalents | 765 | 1,396 | 735 | (6,386) |
Increase (decrease) in cash and cash equivalents | 15,985 | (37,816) | 35,203 | (125,754) |
Cash and cash equivalents at the beginning of the period | 69,979 | 88,577 | 50,761 | 176,515 |
Cash and cash equivalents at the end of the period | $ 85,964 | $ 50,761 | $ 85,964 | $ 50,761 |
Cash Flow
In Q4, 2023, the cash flow generated from operating activities was
Q4, 2023 free cash flow was
Financial Position
As at
ESG
In 2023, SilverCrest published its inaugural full ESG report following the success of the
SilverCrest continues to execute on its commitment to invest in initiatives that support water stewardship in communities local to Las Chispas. In 2023, SilverCrest allocated
The Company's ESG practices and community engagement earned recognition in
Fourth Quarter 2023 Conference Call
A conference call to discuss the Company's Q4, 2023 operational and financial results will be held
Date & Time: | |
Telephone: | |
North America Toll Free: 1-888-259-6580 | |
Conference ID: 58528537 | |
Webcast: | https://silvercrestmetals.com/investors/presentations/ |
ABOUT
SilverCrest is a Canadian precious metals producer headquartered in
Non-GAAP Financial Measures
Management believes that the following non-GAAP financial measures will enable certain investors to better evaluate the Company's performance, liquidity, and ability to generate cash flow. These measures do not have any standardized definition under IFRS, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these measures differently.
Average realized gold and silver price
Average realized gold and silver price per ounce is calculated by dividing the Company's gross revenue from gold or silver sales for the relevant period by the gold or silver ounces sold, respectively. The Company believes the measure is useful in understanding the metal prices realized by the Company throughout the period. The following table reconciles revenue and metal sold during the period with average realized prices:
Q4, 2023 | 2023 | 2022 | ||
Revenues from financial statements | $ 61,320 | $ 245,130 | $ 43,510 | |
Ag sales | (29,452) | (131,867) | (23,784) | |
Au sales | A | 31,868 | 113,263 | 19,726 |
Au oz sold during the period | B | 16,100 | 58,200 | 11,400 |
Average realized Au price per oz sold | A/B | $ 1,979 | $ 1,946 | $ 1,730 |
Revenues from financial statements | $ 61,320 | $ 245,130 | $ 43,510 | |
Au sales | (31,868) | (113,263) | (19,726) | |
Ag sales | A | 29,452 | 131,867 | 23,784 |
Ag oz sold during the period | B | 1,275,300 | 5,616,300 | 1,105,700 |
Averaged realized Ag price per oz sold | A/B | $ 23.09 | $ 23.48 | $ 21.51 |
Capital expenditures
Capital expenditures are classified into sustaining capital expenditures or non-sustaining capital expenditures depending on the nature of the expenditure. Sustaining capital expenditures are those required to support current production levels. Non-sustaining capital expenditures represent the capital spending at new projects and major, discrete projects at existing operations intended to increase production or extend mine life. Management believes this to be a useful indicator of the purpose of capital expenditures and this distinction is an input into the calculation of AISC.
The following table reconciles payments for mineral properties, plant and equipment, and equipment leases to sustaining and non-sustaining capital expenditures:
Q4, 2023 | 2023 | |
Payments for mineral properties, plant and equipment | $ 17,327 | $ 51,257 |
Payments for equipment leases | 30 | 112 |
Total capital expenditures | 17,357 | 51,368 |
Less: Non-sustaining capital expenditures | (5,332) | (14,224) |
Sustaining capital expenditures | $ 12,025 | $ 37,144 |
Free cash flow
Free cash flow, a non-GAAP financial metric, subtracts sustaining capital expenditures from net cash provided by operating activities, serving as a valuable indicator of our capacity to generate cash from operations post-sustaining capital investments. The following table reconciles this non-GAAP financial measure to the most directly comparable IFRS measure.
Q4, 2023 | 2023 | ||
Net cash provided by operating activities | $ 36,096 | $ 158,261 | |
Less: sustaining capital expenditures | (12,025) | (37,145) | |
Free cash flow | $ 24,071 | $ 121,116 | |
Free cash flow per share (basic) | $ 0.16 | $ 0.82 | |
Weighted average shares outstanding (basic) | 146,334 | 146,882 |
SilverCrest calculates treasury assets as cash and cash equivalents plus bullion as reported in the consolidated statements of financial position. Management believes that treasury assets provide a useful measure of the Company's most liquid assets that can be used to settle short-term obligations or provide liquidity.
2023 | 2022 | |
Cash and cash equivalents | $ 85,964 | $ 50,761 |
Bullion | 19,191 | — |
$ 105,155 | $ 50,761 |
Cash costs
Cash costs are a non-GAAP financial metric which includes production costs, royalties and minesite general and administrative costs. Management uses this measure to monitor the performance of its mining operation and ability to generate positive cash flow on a site basis.
AISC
All-in sustaining costs, a non-GAAP financial measure, starts with cash costs and includes all other general and administrative costs, reclamation accretion expense and sustaining capital expenditures. Management uses this measure to monitor the performance of its mining operation and ability to generate positive cash flow on an overall company basis.
Cash costs and AISC are calculated as follows:
Q4, 2023 | 2023 | |
Production costs | $ 17,555 | $ 74,108 |
Royalties | 490 | 1,368 |
General and administrative expenses, minesite | 999 | 3,703 |
Total cash costs | 19,044 | 79,179 |
General and administrative expenses, other | 5,500 | 12,053 |
Reclamation accretion expense | 139 | 493 |
Sustaining capital expenditures | 12,025 | 37,145 |
Total AISC | $ 36,708 | $ 128,870 |
Silver equivalent ounces sold (koz) | 2,555 | 10,244 |
Cash costs (per AgEq sold) | $ 7.45 | $ 7.73 |
AISC (per AgEq sold) | $ 14.36 | $ 12.58 |
Net cash
SilverCrest calculates net cash by deducting debt from cash and cash equivalents as reported in the consolidated statements of financial position. The Company believes that in addition to conventional measures prepared in accordance with IFRS, net cash is useful to evaluate the Company's and liquidity and capital resources.
2023 | 2022 | |
Cash and cash equivalents | $ 85,964 | $ 50,761 |
Debt | — | (49,591) |
Net cash | $ 85,964 | $ 1,170 |
Forward-Looking Statements
This news release contains "forward-looking statements" and "forward-looking information" (collectively "forward-looking statements") within the meaning of applicable Canadian and
Qualified Persons Statement
The Qualified Person under National Instrument 43-101 Standards of Disclosure for Mineral Projects for this news release is
View original content to download multimedia:https://www.prnewswire.com/news-releases/silvercrest-reports-fourth-quarter-and-2023-annual-financial-results-302085231.html
SOURCE
© Canada Newswire, source