Americas Silver Corporation (TSX: USA) (NYSE American: USAS)
(“Americas Silver” or the “Company”) today announced production and
operating cost results for the second quarter of 2018 on a
consolidated basis and individually for its Cosalá Operations and
Galena Complex. All figures are in U.S. dollars unless otherwise
indicated.
Second Quarter
Highlights
- Consolidated silver production for the
quarter of approximately 300,000 silver ounces and 1.5 million
silver equivalent1 ounces, representing decreases of 24% and 9%,
respectively, when compared to Q1, 2018, and a decrease of 46% and
an increase of 24%, respectively, year-over-year.
- Consolidated cash costs2 for the
quarter were approximately negative ($6.15) per silver ounce, a
decrease of 125% when compared to Q1, 2018 and 185% year-over-year,
while consolidated all-in sustaining costs2 (“AISC”) were
approximately $5.40 per silver ounce, a decrease of 13% when
compared to Q1, 2018 and 49% year-over-year.
- Cosalá Operations milled tonnage
increased by 13% over Q1, 2018 as San Rafael continued to
successfully ramp up both mining and milling rates in the second
quarter of commercial production. As a result, silver production
increased to approximately 90,000 silver ounces and 1.0 million
silver equivalent ounces during the quarter, representing increases
of 19% and 10%, respectively, when compared to Q1, 2018. Cash costs
were approximately negative ($60.13) per silver ounce and AISC were
approximately negative ($41.66) per silver ounce representing a
decrease of 15% when compared to Q1, 2018.
- As previously announced, Galena Complex
production for the quarter was negatively impacted by two separate
issues at its No.3 Shaft that inhibited normal hoisting for
approximately 27 days in total. As a result, the Complex produced
approximately 210,000 silver ounces and 420,000 silver equivalent
ounces, representing decreases of 35% and 37%, respectively, when
compared to Q1, 2018, and decreases of 34% and 31%, respectively,
year-over-year. Cash costs were approximately $18.36 per silver
ounce and AISC were approximately $26.77 per silver ounce. The
issues impacting second quarter production are not expected to
affect production in the second half of the year.
- Guidance for 2018 remains unchanged at
1.6 – 2.0 million silver ounces and 7.2 – 8.0 million silver
equivalent ounces at cash costs of negative ($10.00) to negative
($5.00) per silver ounce and AISC of negative ($1.00) to $4.00 per
silver ounce. The Company expects to release its second quarter
financial results on or before August 9, 2018.
- The Company had cash and cash
equivalents of $7.8 million at June 30, 2018.
“The San Rafael mine successfully increased mining and milling
rates by almost 15% during the quarter and we expect further
increases in the third quarter as it continues to ramp up the mill
to capacity,” said Darren Blasutti, President & CEO of Americas
Silver. “These increases allowed the Company to continue to drive
down its industry-leading cash costs and AISC when compared to both
last quarter and last year, despite lower than expected production
from the Galena Complex. Now that the necessary repairs at Galena
have been successfully completed in the second quarter, we can
continue to execute our operational plan for the remainder of the
year.”
Consolidated Second Quarter Production
Details
Consolidated silver production for the second quarter of 2018
was 301,711 silver ounces which represents a decrease of 24% over
the previous quarter and 46% year-over-year. Silver equivalent
production was approximately 1.5 million ounces, down 9% over the
previous quarter and up 24% year-over-year. The increase in the
milling rate achieved at Cosalá Operations was offset by the lower
tonnage at the Galena Complex during the quarter. Consolidated cash
costs decreased 125% to negative ($6.15) per silver ounce comparted
to previous quarter and 185% year-over-year, and AISC decreased 13%
to $5.40 per silver ounce compared to the previous quarter and 49%
year-over-year. Consolidated zinc production increased by 19%
compared to Q1, 2018 and 201% compared to Q2, 2017; consolidated
lead production decreased by 18% compared to Q1, 2018. The
decreases in silver, silver equivalent, silver grade, and lead
production compared to Q1, 2018 are primarily due the issues
associated with the No.3 Shaft at the Galena Complex.
Table 1
Consolidated Production
Highlights
Q2 2018 Q2 2017
Change Q1 2018 Change Processed
Ore (tonnes milled) 164,313 179,427 -8% 163,875 1% Silver
Production (ounces) 301,711 557,892 -46% 397,035 -24% Silver
Equivalent Production (ounces) 1,462,170 1,175,836 24% 1,613,711
-9% Silver Grade (grams per tonne) 77 107 -28% 95 -19% Cost of
Sales ($ per equiv. ounce silver) 1 $8.19 $11.00 -26% $8.14 1% Cash
Costs ($ per ounce silver) 1 ($6.15) $7.21 -185% ($2.73) -125%
All-in Sustaining Costs ($ per ounce silver) 1 $5.40 $10.65 -49%
$6.17 -13% Zinc Production (pounds) 8,756,201 2,904,374 201%
7,332,978 19% Lead Production (pounds) 6,216,592 6,435,048 -3%
7,624,685 -18% Copper Production (pounds) - 273,475 -100% - -
1 Cost of sales per silver equivalent ounce, cash costs per
silver ounce, and all-in sustaining costs per silver ounce for Q2,
2017 excludes pre-production of 22,549 silver ounces and 32,955
silver equivalent ounces, respectively, mined from El Cajón during
its commissioning period. Pre-production revenue and cost of sales
from El Cajón are capitalized as an offset to development
costs.
Cosalá Operations Production
Details
The Cosalá Operations produced 94,231 ounces of silver during
the second quarter of 2018 and 1,041,246 ounces of silver
equivalent during the same period at cash costs of negative
($60.13) per silver ounce and AISC of negative ($41.66) per silver
ounce. Silver production increased 19% over the previous quarter
while silver equivalent production increased 10% over the previous
quarter and 85% year-over-year. Cash costs and AISC were down
compared to the previous quarter from negative ($59.52) per silver
ounce and negative ($36.28) per silver ounce, respectively, and
down significantly year-over-year from negative ($2.81) per silver
ounce and negative ($2.81) per silver ounce, respectively. The
improved results at San Rafael relative to Q1, 2018 are a result of
the increase in milling rate (13%) as the process plant continued
to ramp-up operations to targeted levels during the quarter.
Table 2
Cosalá Operations Highlights
Q2 2018 Q2 2017
Change Q1 2018 Change Processed
Ore (tonnes milled) 138,708 134,778 3% 123,285 13% Silver
Production (ounces) 94,231 242,523 -61% 79,382 19% Silver
Equivalent Production (ounces) 1,041,246 564,112 85% 948,081 10%
Silver Grade (grams per tonne) 42 66 -36% 42 0% Cost of Sales ($
per equiv. ounce silver) 1 $5.34 $7.57 -29% $5.92 -10% Cash Costs
($ per ounce silver) 1 ($60.13) ($2.81) >-100% ($59.52) -1%
All-in Sustaining Costs ($ per ounce silver) 1 ($41.66) ($2.81)
>-100% ($36.28) -15% Zinc Production (pounds) 8,756,201
2,904,374 201% 7,332,978 19% Lead Production (pounds) 2,982,316
1,351,258 121% 2,679,485 11% Copper Production (pounds) - 273,475
-100% - -
1 Cost of sales per silver equivalent ounce, cash costs per
silver ounce, and all-in sustaining costs per silver ounce for Q2,
2017 excludes pre-production of 22,549 silver ounces and 32,955
silver equivalent ounces, respectively, mined from El Cajón during
its commissioning period. Pre-production revenue and cost of sales
from El Cajón are capitalized as an offset to development
costs.
Galena Complex Production
Details
As previously announced on June 14, 2018, production at the
Galena Complex was negatively impacted by two issues affecting the
No.3 Shaft: a 10-day suspension of hoisting in late April to allow
the repair of steel sets in the shaft, and a 17-day shutdown of the
hoist in June to address a mechanical failure in the brake
mechanism. The Complex was temporarily considered to be on care and
maintenance for the 17-day shutdown as repairs were performed with
certain costs excluded from the cash costs and AISC calculations.
Repairs were completed by the end of June 2018 and these issues are
not expected to impact production rates for the remainder of the
year.
As a result, the Galena Complex produced 207,480 ounces of
silver and 420,924 ounces of silver equivalent during the second
quarter of 2018 at cash costs of $18.36 per silver ounce and AISC
of $26.77 per silver ounce. Silver and silver equivalent production
decreased 35% and 37%, respectively, compared to the previous
quarter, and decreased 34% and 31%, respectively, year-over-year.
Cash costs increased by 60% compared to the prior quarter and 29%
year-over-year, and AISC were up 60% compared to the prior quarter
and 34% year-over-year.
Table 3
Galena Complex Highlights
Q2 2018 Q2 2017
Change Q1 2018 Change Processed
Ore (tonnes milled) 25,605 44,649 -43% 40,590 -37% Silver
Production (ounces) 207,480 315,369 -34% 317,653 -35% Silver
Equivalent Production (ounces) 420,924 611,724 -31% 665,630 -37%
Silver Grade (grams per tonne) 263 231 14% 256 3% Cost of Sales ($
per equiv. ounce silver) $15.23 $13.98 9% $11.31 35% Cash Costs ($
per ounce silver) $18.36 $14.20 29% $11.46 60% All-in Sustaining
Costs ($ per ounce silver) $26.77 $20.03 34% $16.78 60% Lead
Production (pounds) 3,234,276 5,083,790 -36% 4,945,200 -35%
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 holds an option on the San Felipe development
project in Sonora, Mexico.
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 exploration,
operational, production, and development plans, 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 Silver equivalent production throughout this press release was
calculated based on silver, zinc, lead and copper realized prices
during each respective period.2 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 2017 year-end and
quarterly MD&A. The performance measures for the quarter ended
June 30, 2018 are preliminary throughout this press release subject
to refinement from the Company’s second quarter financial results
to be released on or before August 9, 2018.
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version on businesswire.com: https://www.businesswire.com/news/home/20180719005874/en/
Americas Silver CorporationDarren BlasuttiPresident and
CEO416‐848‐9503
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