
Pan American Silver Corp. (TSX: PAAS) (NYSE: PAAS) reported unaudited results for the quarter ended June 30, 2023, inclusive of the assets acquired through the Yamana Gold Inc. transaction, which closed on March 31, 2023.
“Our Q2 2023 results show the significant enhancement in the scale and quality of our portfolio following the strategic acquisition of Yamana. Production is up 55% for silver and 102% for gold compared with the prior quarter, while the addition of three new low-cost producers provided tangible benefits to the Company’s cost structure. Based on year-to-date production and costs, we are maintaining our guidance for 2023,” said Michael Steinmann, President and Chief Executive Officer. “Revenue of $639.9 million reflects the step change in our operating base, and drove a 151% increase in operating cash flow before working capital changes compared with Q1 2023. These results deliver on the benefits we had expected from the Yamana transaction, and have allowed us to repay a net $55.4 million of debt and distribute $36.4 million in dividends in the past quarter. We are also on track to meet our target of realizing $40 million to $60 million in synergies through the transaction.”
“We have made significant progress on our commitment to optimize our portfolio by concluding agreements on the disposition of three non-core assets. On July 31, 2023, we announced the sales of Pan American’s interests in the MARA project in Argentina, the Morococha mine in Peru, and the Agua de la Falda project in Chile, as well as non-core equity investments. These dispositions will significantly reduce project development, reclamation and care and maintenance costs going forward, and the cash proceeds will further strengthen our balance sheet. Pan American is well positioned to build on the momentum for growth and deliver returns to shareholders,” added Mr. Steinmann.
The following highlights for Q2 2023 include certain measures that are not generally accepted accounting principles financial measures. Please refer to the section titled “Alternative Performance Measures” at the end of this news release for further information on these measures.
Consolidated Q2 2023 Highlights:
CONSOLIDATED RESULTS
Three months
ended June 30, 2023 |
Twelve months
ended December 31, 2022 |
||||||
Weighted average shares during period (millions) | 364.4 | 210.5 | |||||
Shares outstanding end of period (millions) | 364.4 | 210.7 | |||||
Three months ended
June 30, |
|||||||
2023 | 2022 | ||||||
FINANCIAL | |||||||
Revenue | $ | 639.9 | $ | 340.5 | |||
Mine operating earnings (loss) | $ | 70.6 | $ | (31.6 | ) | ||
Net loss | $ | (47.4 | ) | $ | (173.6 | ) | |
Basic loss per share(1) | $ | (0.13 | ) | $ | (0.83 | ) | |
Adjusted earnings (loss)(2) | $ | 14.7 | $ | (6.5 | ) | ||
Basic adjusted earnings (loss) per share(1) | $ | 0.04 | $ | (0.03 | ) | ||
Net cash generated from operating activities | $ | 117.0 | $ | 20.8 | |||
Net cash generated from operating activities before changes in working capital(2) | $ | 108.7 | $ | 40.5 | |||
Sustaining capital expenditures(2) | $ | 86.7 | $ | 56.5 | |||
Non-sustaining capital expenditures(2) | $ | 39.3 | $ | 19.9 | |||
Cash dividend paid per share | $ | 0.10 | $ | 0.12 | |||
PRODUCTION | |||||||
Silver (thousand ounces) | 6,024 | 4,537 | |||||
Gold (thousand ounces) | 248.2 | 128.3 | |||||
Zinc (thousand tonnes) | 9.3 | 9.0 | |||||
Lead (thousand tonnes) | 4.4 | 4.6 | |||||
Copper (thousand tonnes) | 1.3 | 1.3 | |||||
CASH COSTS(2) ($/ounce) | |||||||
Silver Segment | 9.29 | 12.10 | |||||
Gold Segment | 1,045 | 1,132 | |||||
AISC(2) ($/ounce) | |||||||
Silver Segment | 15.70 | 17.30 | |||||
Gold Segment | 1,342 | 2,051 | |||||
AVERAGE REALIZED PRICES(3) | |||||||
Silver ($/ounce) | 23.45 | 22.03 | |||||
Gold ($/ounce) | 1,975 | 1,850 | |||||
Zinc ($/tonne) | 2,515 | 3,811 | |||||
Lead ($/tonne) | 2,123 | 2,162 | |||||
Copper ($/tonne) | 8,550 | 9,731 | |||||
(1) | Per share amounts are based on basic weighted average common shares. | ||||||
(2) | Non-GAAP measure; please refer to the “Alternative Performance (non-GAAP) Measures” section of this news release for further information on these measures. | ||||||
(3) | Metal prices stated are inclusive of final settlement adjustments on concentrate sales. | ||||||
Cash Costs, AISC, adjusted earnings, basic adjusted earnings per share, sustaining and non-sustaining capital, working capital, total debt and net cash are non-GAAP financial measures. Please refer to the “Alternative Performance Measures” section of this news release for further information on these measures.
This news release should be read in conjunction with Pan American’s unaudited Condensed Interim Consolidated Financial Statements and our MD&A for the three and six months ended June 30, 2023. This material is available on Pan American’s website at panamericansilver.com, on SEDAR+ at www.sedarplus.com and on EDGAR at www.sec.gov.
About Pan American
Pan American Silver is a leading producer of precious metals in the Americas, operating silver and gold mines in Canada, Mexico, Peru, Bolivia, Argentina, Chile and Brazil. We also own the Escobal mine in Guatemala that is currently not operating, and we hold interests in exploration and development projects. We have been operating in the Americas for nearly three decades, earning an industry-leading reputation for sustainability performance, operational excellence and prudent financial management. We are headquartered in Vancouver, B.C. and our shares trade on the New York Stock Exchange and the Toronto Stock Exchange.
Alternative Performance (Non-GAAP) Measures
In this news release, we refer to measures that are non-GAAP financial measures. These measures are widely used in the mining industry as a benchmark for performance, but do not have a standardized meaning as prescribed by IFRS as an indicator of performance, and may differ from methods used by other companies with similar descriptions. These non-GAAP financial measures include:
Readers should refer to the “Alternative Performance (non-GAAP) Measures” section of Pan American’s Q2 2023 MD&A for a more detailed discussion of these and other non-GAAP measures and their calculation.
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