Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI)
is pleased to report production results for the third quarter of
2019 from its two operating mines in Latin America, the San Jose
Mine in Mexico and the Caylloma Mine in Peru. The Company
produced 1.9 million ounces of silver and 11,436 ounces of gold
plus base metal by-products. Silver and gold production for
the first nine months of 2019 totaled 6.6 million ounces and 38,247
ounces respectively; being 1 percent above and 4 percent below the
Company’s nine month projection respectively. Fortuna is on
schedule to produce between 8.2 to 9.0 million ounces of silver and
between 49 to 54 thousand ounces of gold or between 11.7 to 12.9
million Ag Eq1 ounces in 2019 in accordance with our annual
production guidance (refer to Fortuna news release dated January
17, 2019).
Third Quarter Production
Highlights
- Silver production of 1,937,293 ounces; 13 percent decrease over
Q3 2018
- Gold production of 11,436 ounces; 9 percent decrease over
Q3 2018
- Lead production of 7,157,229 pounds; 6 percent decrease over Q3
2018
- Zinc production of 11,517,861 pounds; 0.3 percent increase over
Q3 2018
- Cash cost2 for San Jose is US$70.8/t, slightly above 2019
annual cost guidance of between $63.5 to $70.1/t
- Cash cost2 for Caylloma is US$93.0/t, is 5 percent above 2019
annual cost guidance of between $80.0 to $88.4/t
Consolidated Operating
Highlights
|
Third Quarter 2019 |
Third Quarter 2018 |
|
Caylloma, Peru |
San Jose, Mexico |
Consolidated |
Caylloma, Peru |
San Jose, Mexico |
Consolidated |
Processed Ore |
|
|
Tonnes milled |
134,338 |
267,998 |
|
135,996 |
262,710 |
|
Average tpd milled |
1,493 |
3,045 |
|
1,511 |
2,985 |
|
Silver3 |
|
|
Grade (g/t) |
64 |
219 |
|
65 |
258 |
|
Recovery (%) |
82.42 |
90.72 |
|
84.69 |
91.47 |
|
Production (oz) |
228,168 |
1,709,125 |
1,937,293 |
239,253 |
1,991,211 |
2,230,465 |
|
Third Quarter 2019 |
Third Quarter 2018 |
|
Caylloma, Peru |
San Jose, Mexico |
Consolidated |
Caylloma, Peru |
San Jose, Mexico |
Consolidated |
Gold |
|
|
Grade (g/t) |
0.25 |
1.40 |
|
0.17 |
1.61 |
|
Recovery (%) |
46.61 |
90.56 |
|
21.37 |
91.24 |
|
Production (oz) |
494 |
10,942 |
11,436 |
155 |
12,387 |
12,542 |
Lead |
|
|
Grade (%) |
2.68 |
|
|
2.74 |
|
|
Recovery (%) |
90.16 |
|
|
92.23 |
|
|
Production (lbs) |
7,157,229 |
|
7,157,229 |
7,575,541 |
|
7,575,541 |
Zinc |
|
|
Grade (%) |
4.35 |
|
|
4.24 |
|
|
Recovery (%) |
89.38 |
|
|
90.36 |
|
|
Production (lbs) |
11,517,861 |
|
11,517,861 |
11,482,583 |
|
11,482,583 |
Notes to the first page and table above, as applicable:1.
Silver equivalent production does not include lead or zinc and is
calculated using a silver to gold ratio of 72 to 12.
Preliminary estimates of cash operating costs per tonne are subject
to modification on final cost consolidation3. Metallurgical
recovery for silver at the Caylloma Mine is calculated based on
silver content in lead concentrate4. Totals may not add due
to rounding
San Jose Mine, Mexico
The San Jose Mine produced 1,709,125 ounces of
silver and 10,942 ounces of gold in the third quarter of 2019,
8 percent and 13 percent below budget respectively.
Average head grades for silver and gold were 219 g/t and 1.4
g/t, 8 percent and 14 percent below budget respectively. The
decrease in silver and gold production during the third quarter is
mainly due to scheduled mine production activities at lower grade
stopes which is in line with the mine’s production program for the
quarter. Silver and gold production for the first nine months
of 2019 totaled 5.9 million ounces and 36,887 ounces respectively;
being 1 percent above and 7 percent below the mine’s nine month
projection. Annual production of gold and silver at the San
Jose Mine is expected to be within the 2019 annual production
guidance of between 7.3 to 8.1 million ounces of silver and between
49 to 54 thousand ounces of gold (refer to Fortuna news release
dated January 17, 2019).
The San Jose Mine cash cost per tonne for the
third quarter of 2019 is US$70.8; slightly above the annual
guidance range due to higher ground support costs and increased
mine contractor tariffs. Cash cost per tonne for the year is
expected to be within the high end of the annual guidance range
(refer to Fortuna news release dated January 17, 2019).
Caylloma Mine, Peru
The Caylloma Mine produced 228,168 ounces of
silver in the third quarter of 2019, 1 percent above budget.
The average silver head grade of 64 g/t was 3 percent above
budget. Silver production for the first nine months of 2019
totaled 692,005 ounces; 1 percent above the mine’s nine month
projection.
Lead and zinc production in the third quarter of
2019 was 7,157,229 pounds and 11,517,861 pounds respectively, 9
percent and 9 percent above budget respectively. The average
head grades for lead and zinc were 2.68 % and 4.35 %, 9
percent and 11 percent above budget respectively. Base metals
production for the first nine months of 2019 totaled 21,304,857
pounds of lead and 33,986,132 pounds of zinc; being 2 percent and 8
percent above the mine’s nine month projection.
The Caylloma Mine cash cost per tonne for the
third quarter of 2019 is US$93.0; 5 percent above the annual
guidance range due to timing of indirect costs related to
processing plant maintenance. Cash cost per tonne for the year is
expected to be within the high end of the annual guidance range
(refer to Fortuna news release dated January 17, 2019).
Qualified Person
Amri Sinuhaji, Technical Services Director –
Mine Planning, is the Qualified Person for Fortuna Silver Mines
Inc. as defined by National Instrument 43-101. Mr. Sinuhaji
is a Professional Engineer registered with the Association of
Professional Engineers and Geoscientists of the Province of British
Columbia (#48305) and has reviewed and approved the scientific and
technical information contained in this news release.
About Fortuna
Silver Mines Inc.
Fortuna is a growth oriented, precious metals
producer focused on mining opportunities in Latin America.
Our primary assets are the Caylloma silver Mine in southern
Peru, the San Jose silver-gold Mine in Mexico and the Lindero gold
Project, currently under construction, in Argentina. The
Company is selectively pursuing acquisition opportunities
throughout the Americas and in select other areas. For more
information, please visit our website at www.fortunasilver.com.
Jorge A. Ganoza President, CEO and
DirectorFortuna Silver Mines Inc.
Trading symbols: NYSE: FSM | TSX: FVI
Investor Relations:
Carlos BacaT (Peru): +51.1.616.6060, ext. 0
Forward looking Statements
This news release contains forward looking
statements which constitute "forward looking information" within
the meaning of applicable Canadian securities legislation and
"forward looking statements" within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act
of 1995 (collectively, "Forward looking Statements"). All
statements included herein, other than statements of historical
fact, are Forward looking Statements and are subject to a variety
of known and unknown risks and uncertainties which could cause
actual events or results to differ materially from those reflected
in the Forward looking Statements. The Forward looking Statements
in this news release include, without limitation, statements about
the Company's plans for its mines and mineral properties; the
Company's business strategy, plans and outlook; the merit of the
Company's mines and mineral properties; the future financial or
operating performance of the Company; 2019 production and cost
guidance; and proposed expenditures. Often, but not always, these
Forward looking Statements can be identified by the use of words
such as "estimated", "potential", "open", "future", "assumed",
"projected", "used", "detailed", "has been", "gain", "planned",
"reflecting", "will", "containing", "remaining", "to be", or
statements that events, "could" or "should" occur or be achieved
and similar expressions, including negative variations.
Forward looking Statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to be
materially different from any results, performance or achievements
expressed or implied by the Forward looking Statements. Such
uncertainties and factors include, among others, changes in general
economic conditions and financial markets; changes in prices for
silver and other metals; technological and operational hazards in
Fortuna's mining and mine development activities; risks inherent in
mineral exploration; uncertainties inherent in the estimation of
mineral reserves, mineral resources, and metal recoveries;
governmental and other approvals; political unrest or instability
in countries where Fortuna is active; labor relations issues; as
well as those factors discussed under "Risk Factors" in the
Company's Annual Information Form. Although the Company has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in Forward looking Statements, there may be other factors
that cause actions, events or results to differ from those
anticipated, estimated or intended.
Forward looking Statements contained herein are
based on the assumptions, beliefs, expectations and opinions of
management, including but not limited to expectations regarding the
Company's plans for its mines and mineral properties; mine
production costs; expected trends in mineral prices and currency
exchange rates; the accuracy of the Company's current mineral
resource and reserve estimates; that the Company's activities will
be in accordance with the Company's public statements and stated
goals; that there will be no material adverse change affecting the
Company or its properties; that all required approvals will be
obtained; that there will be no significant disruptions affecting
operations and such other assumptions as set out herein. Forward
looking Statements are made as of the date hereof and the Company
disclaims any obligation to update any Forward looking Statements,
whether as a result of new information, future events or results or
otherwise, except as required by law. There can be no assurance
that Forward looking Statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, investors should not
place undue reliance on Forward looking Statements.
This news release also refers to non-GAAP
financial measures, such as cash cost per tonne of processed ore;
cash cost per payable ounce of silver; total production cost per
tonne; all-in sustaining cash cost; all-in cash cost; adjusted net
(loss) income; operating cash flow per share before changes in
working capital, income taxes, and interest income; and adjusted
EBITDA. These measures do not have a standardized meaning or method
of calculation, even though the descriptions of such measures may
be similar. These performance measures have no meaning under
International Financial Reporting Standards (IFRS) and therefore,
amounts presented may not be comparable to similar data presented
by other mining companies.
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