Americas Silver Corporation (TSX: USA) (NYSE American: USAS)
(“Americas Silver” or the “Company”) today reported consolidated
financial and operational results for the third quarter of
2017.
This earnings release should be read in conjunction with the
Company’s Third Quarter Production and Cost Update, Management’s
Discussion and Analysis, Financial Statements and Notes to
Financial Statements for the corresponding period, which have been
posted on the Americas Silver Corporation SEDAR profile at
www.sedar.com, on its EDGAR profile at www.sec.gov, and are also
available on the Company’s website at www.americassilvercorp.com.
All figures are in U.S. dollars unless otherwise noted.
Third Quarter Highlights
- Revenues of $9.8 million in Q3, 2017,
excluding $3.8 million of El Cajón and San Rafael pre-production
revenues capitalized to development costs, compared with revenues
of $16.8 million in Q3, 2016.
- Cash flow generated from operating
activities1 in the first three quarters of 2017 of $5.9 million,
compared to cash generated from operating activities of
approximately $5.2 million for the first three quarters of
2016.
- A net loss of ($2.8) million or ($0.07)
cents per share in Q3, 2017, compared with a net income of $1.0
million or $0.03 cents per share in Q3, 2016.
- The Company expects San Rafael to be
the sole source of the mill feed by the end of the week of November
13, 2017 with commercial production expected before the end of the
fourth quarter. The project remains fully funded and initial
capital is expected to be less than $17 million, lower than the
original April 2016 Pre-feasibility Study estimate of $21
million.
- Previously announced, consolidated
silver production for the quarter of approximately 565,000 silver
ounces and 1.1 million silver equivalent2 ounces, representing a
decrease of 5% and an increase of 1%, respectively, compared to Q3,
2016.
- Consolidated cash costs3 for the
quarter were approximately $12.61 per silver ounce, an increase of
26% year-over-year, while consolidated all-in sustaining costs3
were approximately $15.92 per silver ounce, an increase of 24%
year-over-year. Including the El Cajón pre-production by-product
revenues net of direct mining, smelting and refining costs, cash
costs and all-in sustaining costs would have been $11.77 and $14.18
per silver ounce, respectively.
- Guidance for 2017 remains at 2.0 - 2.5
million ounces of silver production and silver equivalent
production of 5.0 - 5.5 million ounces with projected cash costs at
the high end of the $4.00 - $5.00 per silver ounce and all-in
sustaining cash costs of $9.00 - $10.00 per silver ounce ranges
depending on the timing of the declaration of commercial production
at San Rafael.
- Cash balance at September 30, 2017 of
$8.7 million with net working capital of approximately $14.9
million.
“This event marks an exciting moment in the history of the
Company,” said Americas Silver Corporation President and CEO Darren
Blasutti. “With San Rafael going into full production this
week, coupled with ten-year historic prices for zinc and lead, we
expect to drive significant earnings and cash flow for our
shareholders starting in Q1, 2018 and over the life of the
mine.”
Consolidated Production and Operating
Costs
Consolidated Production and Cost Details Q3
2017 Q3 2016 Total ore processed (tonnes milled)
174,677 166,770 Silver produced (ounces) 564,833 596,855 Zinc
produced (pounds) 1,433,961 2,183,814 Lead produced (pounds)
5,369,482 7,991,507 Copper produced (pounds) 507,285 326,639 Silver
equivalent produced (ounces) 1,107,874 1,107,110 Silver recovery
(percent) 90.9 89.7 Silver grade (grams per tonne) 111 124 Silver
sold (ounces) 542,298 601,845 Zinc sold (pounds) 1,258,532
2,142,465 Lead sold (pounds) 5,224,322 7,976,671 Copper sold
(pounds) 460,227 337,306 Cost of sales ($ per silver equivalent
ounce)1 $9.17 $10.25 Silver cash cost ($ per silver ounce) 1 $12.61
$10.00 All-in sustaining cost ($ per silver ounce) 1 $15.92 $12.86
1 Cost of sales per silver equivalent ounce, cash costs per
silver ounce, and all-in sustaining costs per silver ounce in Q3,
2017 excludes contributions of 160,128 silver ounces and 238,919
silver equivalent ounces from El Cajón during its commissioning
period, and excludes pre-production of 5,146 silver ounces and
30,161 silver equivalent ounces minded from San Rafael during its
commissioning period. Pre-production revenue (net of cost of sales)
from El Cajón and San Rafael are capitalized as an offset to
development costs.
Net loss of ($2.8) million was recorded for the quarter,
compared to a net income of $1.0 million for the third quarter of
2016. The Company also generated cash from operating activities
before non-cash working capital items of $5.9 million in the first
three quarters of 2017 compared to $5.2 million in the first three
quarters of 2016. The decrease in net income is primarily
attributable to lower net revenue on timing of concentrate sales,
lower silver, zinc and lead production, share-based compensation,
higher marketing expenses to support the U.S. listing, and higher
exploration costs at Zone 120. This decrease was partially offset
by lower cost of sales, higher base metal prices, and lower
interest and financing expenses. Production for the quarter dropped
due to lower grades at Nuestra Señora compared to the prior year
due to the wind-down of operations in Q3 and Q4, 2017 and
underperformance at the Galena Complex in the quarter.
Consolidated silver production for the third quarter of 2017 was
564,833 silver ounces which represents an increase of 1% over the
previous quarter and a decrease of 5% year-over-year. Silver
equivalent production was approximately 1.1 million ounces, down 6%
over the previous quarter and up 1% year-over-year. The decrease in
silver and silver equivalent production is primarily due to lower
tonnage and grade at the Galena Complex, partially offset by the
continuing strong production from the Nuestra Señora and El Cajón
mines as the Cosalá Operations prepares to commence commercial
production from San Rafael later in the quarter.
Further information concerning the consolidated and individual
mine operations is included in the Company’s third quarter
Condensed Interim Consolidated Financial Statements for the nine
months ended September 30, 2017 and Management’s Discussion and
Analysis for the three and nine months ended September 30,
2017.
About Americas Silver
Corporation
Americas Silver is a silver mining company focused on growth in
precious metals from its existing asset base and execution of
targeted accretive acquisitions. It owns and operates the Cosalá
Operations in Sinaloa, Mexico and the Galena Mine Complex in Idaho,
USA. The Company has acquired an option on the San Felipe
development project in Sonora, Mexico.
Daren Dell, Chief Operating Officer and a Qualified Person under
Canadian Securities Administrators guidelines, has approved the
applicable contents of this news release. For further information
please see SEDAR or americassilvercorp.com.
Cautionary Statement on Forward-Looking Information:
This news release contains “forward‐looking information” within
the meaning of applicable securities laws. Forward‐looking
information includes, but is not limited to, the Company’s
expectations intentions, plans, assumptions and beliefs with
respect to, among other things, the realization of operational and
development plans (including completion of the San Rafael Project),
the Cosalá Operations and Galena Complex as well as the Company’s
financing efforts. Often, but not always, forward‐looking
information can be identified by forward‐looking words such as
“anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”,
“estimate”, “may”, “assume” and “will” or similar words suggesting
future outcomes, or other expectations, beliefs, plans, objectives,
assumptions, intentions, or statements about future events or
performance. Forward‐looking information is based on the opinions
and estimates of the Company as of the date such information is
provided and is subject to known and unknown risks, uncertainties,
and other factors that may cause the actual results, level of
activity, performance, or achievements of the Company to be
materially different from those expressed or implied by such
forward looking information. This includes the ability to develop
and operate the Cosalá and Galena properties, risks associated with
the mining industry such as economic factors (including future
commodity prices, currency fluctuations and energy prices), ground
conditions and factors other factors limiting mine access, failure
of plant, equipment, processes and transportation services to
operate as anticipated, environmental risks, government regulation,
actual results of current exploration and production activities,
possible variations in ore grade or recovery rates, permitting
timelines, capital expenditures, reclamation activities, social and
political developments and other risks of the mining industry.
Although the Company has attempted to identify important factors
that could cause actual results to differ materially from those
contained in forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated, or
intended. Readers are cautioned not to place undue reliance on such
information. By its nature, forward-looking information involves
numerous assumptions, inherent risks and uncertainties, both
general and specific that contribute to the possibility that the
predictions, forecasts, and projections of various future events
will not occur. The Company undertakes no obligation to update
publicly or otherwise revise any forward-looking information
whether as a result of new information, future events or other such
factors which affect this information, except as required by
law.
1 Cash flow generated from operating activities is a non-IFRS
financial measure calculated as net cash flow used in operating
activities less changes in non-cash working capital items such as
trade and other receivables, inventories, prepaid expenses, and
trade and other payables.2 Silver equivalent production throughout
this press release was calculated based on silver, zinc, lead and
copper realized prices during each respective period.3 Cash cost
per ounce and all-in sustaining cost per ounce are non-IFRS
performance measures with no standardized definition. For further
information and detailed reconciliations, please refer to the
Company’s 2016 year-end and quarterly MD&A.
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version on businesswire.com: http://www.businesswire.com/news/home/20171114006681/en/
Americas Silver CorporationDarren BlasuttiPresident and
CEO416-848-9503
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