Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) (“Fortuna”
or the “Company”) today reported its financial and
operating results for the fourth quarter and full year 2022.
Fourth Quarter and Full Year 2022
highlights
Financial
- Adjusted net income1 of $7.2
million or $0.02 per share in Q4 2022, totaling $42.6 million, or
$0.15 per share for the full year 2022
- Net loss for the quarter of $160.4
million or $0.52 per share after non-cash impairment charges net of
tax of $164.5 million in Q4 2022, totaling a net loss of $135.9
million for the full year 2022
- Adjusted EBITDA1 of $55.8 million
in Q4 2022; totaling $245.5 million for the full year 2022
- Free cash flow from ongoing
operations1 of $4.4 million in Q4 2022; totaling $69.2 million for
the full year 2022
- Share buybacks of $5.9 million
completed during 2022
- Liquidity as at December 31, 2022
was $150.5 million
Operational
- Silver and gold production of
1,746,746 ounces and 64,112 ounces respectively in Q4 2022;
6,907,275 ounces and 259,427 ounces for the full year 2022; gold
equivalent3 production of 401,878 ounces for the full year
2022.
- Q4 2022 cash costs1 per ounce of
gold of $815 for the Lindero Mine and $818 for the Yaramoko Mine.
Cash costs1,2 per silver equivalent ounce of payable silver sold of
$11.16 for the San Jose Mine and $12.46 for the Caylloma mine.
- Q4 2022 AISC1 per ounce of gold
sold of $1,221 for the Lindero Mine and $1,829 for the Yaramoko
Mine. AISC1,2 per silver equivalent ounce of payable silver sold of
$15.53 and $20.30 for the San Jose Mine and Caylloma Mine,
respectively
- Full year 2022 AISC1 per ounce of
gold sold of $1,142 for the Lindero Mine and $1,529 for the
Yaramoko Mine. AISC1,2 per silver equivalent ounce of payable
silver sold of $15.11 and $17.97 for the San Jose Mine and Caylloma
Mine, respectively
- Lost Time Injury Frequency Rate
(LTIFR) of 0.39 and Total Recordable Injury Frequency Rate (TRIFR)
of 2.32 at the end of the year, with one fatal accident (refer to
Fortuna’s news release January 28, 2022) and five lost time injury
incidents recorded during the year.
Growth and Development
- Séguéla Project construction 93%
complete as of the end of February 2023. On-time and on-budget for
first gold pour in mid 2023
- In 2022, exploration success at the
Sunbird discovery at Séguéla has resulted in a new mineral deposit
including an Indicated Mineral Resource of 3.2 million tonnes at an
average grade of 2.66 g/t gold containing 279,000 ounces and
an Inferred Mineral Resource of 4.2 million tonnes at an average
grade of 3.73 g/t gold containing 506,000 ounces (refer to Fortuna
news release dated December 5, 2022).
1 Refer to Non-IFRS financial measures 2 AISC/oz
Ag Eq calculated at realized metal prices, refer to mine site
results for realized prices and Non-IFRS Financial Measures for
silver equivalent ratio3 Gold equivalent production includes gold,
silver, lead and zinc and is calculated using the following metal
prices: $1,802/oz Au, $21.75/oz Ag, $2,161/t Pb and $3,468/t Zn or
Au:Ag = 1:82.89, Au:Pb = 1:0.83, Au:Zn = 1:0.52
Jorge A. Ganoza, President and CEO, commented,
“Fortuna finished the year in line with production guidance, with
only a slight miss in cost guidance at the Lindero Mine in spite of
strong inflationary pressures. Our business continued to generate
healthy free cash flow from ongoing operations of $69.2 million and
adjusted results of $245.5 million in Adjusted EBITDA, and adjusted
net income of $42.6 million or $0.15 per share.” Mr. Ganoza added,
“As we look forward to 2023 we expect to increase production and
improve costs in the second half of the year as our new Séguéla
flagship asset comes into production."
Fourth Quarter 2022 and Full Year 2022
Consolidated Results
| |
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|
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|
Three months ended December 31, |
|
Years ended December 31, |
|
(Expressed in millions) |
|
2022 |
|
|
2021 |
|
% Change |
|
2022 |
|
|
2021 |
|
% Change |
|
Sales |
|
164.7 |
|
|
198.9 |
|
(17 |
%) |
|
681.5 |
|
|
599.9 |
|
14 |
% |
| Mine operating income |
|
26.0 |
|
|
58.3 |
|
(55 |
%) |
|
146.8 |
|
|
205.5 |
|
(29 |
%) |
| Operating (loss) income |
|
(173.1 |
) |
|
38.9 |
|
(545 |
%) |
|
(113.6 |
) |
|
136.9 |
|
(183 |
%) |
| Net (loss) income |
|
(160.4 |
) |
|
16.6 |
|
(1,066 |
%) |
|
(135.9 |
) |
|
59.4 |
|
(329 |
%) |
| (Loss) earnings per share -
basic |
|
(0.52 |
) |
|
0.05 |
|
(1,148 |
%) |
|
(0.44 |
) |
|
0.24 |
|
(283 |
%) |
| Adjusted net income1 |
|
7.2 |
|
|
29.1 |
|
(75 |
%) |
|
42.6 |
|
|
100.6 |
|
(58 |
%) |
| Adjusted EBITDA1 |
|
55.8 |
|
|
89.6 |
|
(38 |
%) |
|
245.5 |
|
|
280.7 |
|
(13 |
%) |
| Net cash provided by operating
activities |
|
49.6 |
|
|
57.1 |
|
(13 |
%) |
|
194.2 |
|
|
147.1 |
|
32 |
% |
| Free cash flow from ongoing
operations1 |
|
4.4 |
|
|
28.2 |
|
(84 |
%) |
|
69.2 |
|
|
86.0 |
|
(20 |
%) |
| Capital expenditures2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
33.9 |
|
|
31.6 |
|
7 |
% |
|
98.1 |
|
|
77.2 |
|
27 |
% |
|
Non-sustaining3 |
|
(2.3 |
) |
|
2.6 |
|
(188 |
%) |
|
8.2 |
|
|
9.5 |
|
(14 |
%) |
|
Lindero construction |
|
- |
|
|
- |
|
0 |
% |
|
- |
|
|
12.8 |
|
(100 |
%) |
|
Séguéla construction |
|
23.5 |
|
|
19.8 |
|
19 |
% |
|
107.7 |
|
|
34.2 |
|
215 |
% |
|
Brownfields |
|
6.5 |
|
|
8.2 |
|
(21 |
%) |
|
23.3 |
|
|
18.9 |
|
23 |
% |
| As at |
|
|
|
|
|
|
|
December 31, 2022 |
|
|
December 31, 2021 |
|
% Change |
| Cash and cash
equivalents |
|
|
|
80.5 |
|
|
107.1 |
|
(25 |
%) |
| Net
liquidity position |
|
|
|
|
|
|
|
150.5 |
|
|
187.1 |
|
(20 |
%) |
| 1 Refer to
Non-IFRS Financial Measures section at the end of this news release
and to the MD&A accompanying the Company’s financial statements
filed on SEDAR at www.sedar.com for a description of the
calculation of these measures. |
| 2 Capital
expenditures are presented on a cash basis |
| 3 Non-sustaining
expenditures include greenfields exploration |
| Figures may not
add due to rounding |
Fourth Quarter 2022 Results
Net loss for the period was $160.4 million
compared to net income of $16.6 million in Q4 2021. The loss in the
quarter is explained by impairment charges of $164.5 million
($182.8 million before tax) related to the following assets:
- A net impairment of $85.4 million
at Yaramoko ($103.5 million before tax) resulting from the impact
of inflation on operating and capital costs, a reassessment of
exploration potential, and an updated estimate of mineral reserves
at the 55 Zone crown pillar recovery that resulted in a reduction
of 166,000 ounces of gold.
- A net impairment of $70.2 million
at Lindero resulting from the impact of inflation on operating and
capital costs and an increase in discount rates compared to
2021
- A net impairment of $8.9 million
($9.2 million before tax) at San Jose resulting from the impact of
inflation on operating costs and exploration investments not
achieving full replacement of production depletion
After adjusting for impairment charges and other
non-recurring items, adjusted net income was $7.2 million or $0.02
per share compared to $29.1 million or $0.10 per share in Q4 2021.
The decrease was mainly due to lower sales volume and lower average
silver price of $21.4/oz compared to $23.4/oz in Q4 2021, and
higher cash costs across our operations explained mostly by
persistent inflationary trends throughout 2022.
Sales for the quarter were $164.7 million, a
$34.2 million decrease from the $198.9 million reported in the same
period in 2021. The decrease was explained mostly by lower sales
volume at Lindero, San Jose, and Yaramoko, lower silver prices of
9% and slightly lower gold prices.
Adjusted EBITDA for the quarter was $55.8
million, a margin of 34% over sales, compared to $89.6 million
reported in the same period in 2021, representing a margin of 45%
over sales. The main driver for the decrease in EBITDA was the
reduction in sales combined with higher operating costs as
described above.
Net cash generated by operations for the quarter
was $49.6 million or $0.19 per share compared to $57.1 million or
$0.38 per share in Q4 2021. The decrease reflects lower EBITDA of
$33.8 million partially offset by neutral change in working capital
in the current quarter compared to a negative change of $17.7
million in Q4 2021, and lower income taxes paid of $11.7 million.
Additionally, the comparative quarter included a $9.6 million
payment related to the settlement to the disputed Mexican royalty
claim by the Mexican Geological Survey Agency.
Free cash flow from ongoing operations for the
quarter was $4.4 million compared to $28.2 million in Q4 2021. The
decrease reflects lower net cash generated by operations and higher
capex of $26.1 million.
Full Year 2022 Results
Net loss for the year was $135.9 million,
compared to a net gain of $59.4 million in 2021. The loss in 2022
is explained by impairment charges of $164.5 million ($182.8
million before tax) related to the Lindero, San Jose and Yaramoko
Mines as explained above.
After adjusting for impairment charges and other
non- recurring items, adjusted net income was $42.6 million
compared to $100.6 million in 2021. The decrease was mainly due to
a higher cost per ounce across our operations related, to a large
extent, to persistent inflationary trends throughout 2022, and
lower average silver price of $21.8/oz compared to $25.2/oz in
2021
Sales for the year were $681.5 million, an $81.6
million increase from the $599.9 million reported in 2021. The
increase was explained mostly by the full contribution of Yaramoko
in 2022 compared to six months in 2021 partially offset by a lower
average silver price of 13.5%.
Adjusted EBITDA for the year was $245.5 million,
a margin of 36% over sales, compared to $280.7 million reported in
2021, representing a margin of 47% over sales. The main driver for
the decrease in EBITDA was a higher operating cost base combined
with lower silver prices. From a segment perspective Yaramoko´s
added EBITDA contribution year over year of $34.9 million was
offset by lower EBITDA at San Jose of $42.4 million as a result
mostly of lower production and lower metal prices. At Lindero a
volume driven increase in sales compared to the prior year was
offset by a higher cost base. Other items contributing to lower
EBITDA were higher corporate G&A of $6.4 million, higher
share-based payment charges of $6.1 million and higher foreign
exchange charges of $2.8 million.
Net cash generated by operations for 2022 was $194.2 million or
$0.67 per share compared to $147.1 million or $0.61 per share in
2021. The increase, in spite of lower EBITDA of $34.3 million was
due to non-recurrent charges in 2021 of $38.9 million related to
the disputed Mexican royalty claim by the Mexican Geological Survey
Agency ($11.0 million) and Roxgold acquisition transaction expenses
($27.9 million), as well as lower negative changes in working
capital of $21.6 million in 2022, and lower income tax paid of
$20.5 million.
Free cash flow from ongoing operations for 2022
was $69.2 million compared to $86.0 million in 2021. The decrease,
after adjusting net cash generated by operations for the $38.9
million of non-recurrent payments in 2021 described above, reflects
higher capex of $90.5 million related mostly to the full year of
production at Yaramoko, and lower taxes.
Liquidity
Total liquidity available to the Company as at
December 31, 2022 was $150.5 million, comprised of $80.5 million of
cash and cash equivalents and $70.0 million undrawn on the
Company’s revolving $250.0 million credit facility.
Séguéla Construction
As of December 31, 2022, the Séguéla Project had
approximately $38.2 million in payments remaining of the project’s
$173.5 million construction budget, and the project remains on time
and on budget. The Company’s cash and cash equivalents balance,
free cash flow from ongoing operations and undrawn amounts of the
credit facility are expected to be sufficient to fund the
construction of the Séguéla Project.
Lindero Mine, Argentina
|
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|
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|
|
|
| |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Mine Production |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tonnes placed on the leach pad |
|
|
1,334,509 |
|
|
1,457,733 |
|
|
5,498,064 |
|
|
6,453,647 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
0.80 |
|
|
1.04 |
|
|
0.81 |
|
|
0.96 |
|
Production (oz) |
|
|
29,301 |
|
|
36,072 |
|
|
118,418 |
|
|
104,161 |
|
Metal sold (oz) |
|
|
27,847 |
|
|
36,389 |
|
|
117,076 |
|
|
100,177 |
|
Realized price ($/oz) |
|
|
1,732 |
|
|
1,802 |
|
|
1,803 |
|
|
1,785 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash cost ($/oz Au)1 |
|
|
815 |
|
|
585 |
|
|
740 |
|
|
617 |
|
All-in sustaining cash cost ($/oz Au)1 |
|
|
1,221 |
|
|
994 |
|
|
1,142 |
|
|
1,116 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Capital expenditures ($000's)
2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
|
3,973 |
|
|
7,214 |
|
|
18,035 |
|
|
27,522 |
|
Non-sustaining |
|
|
– |
|
|
233 |
|
|
169 |
|
|
323 |
|
Brownfields |
|
|
184 |
|
|
389 |
|
|
1,288 |
|
|
875 |
1 Cash cost and AISC are non-IFRS financial measures. Refer to
Non-IFRS Financial Measures section at the end of this news release
and to the MD&A accompanying the Company’s financial statements
filed on SEDAR at www.sedar.com for a description of the
calculation of these measures.2 Capital expenditures are presented
on a cash basis.
Quarterly Operating and Financial Highlights
In the fourth quarter of 2022, a total of
1,334,509 tonnes of ore were placed on the heap leach pad,
averaging 0.80 g/t gold, containing an estimated 34,350 ounces of
gold. Gold production for Q4 2022 totaled 29,301 ounces,
representing a 19% decrease over Q4 2021. Lower gold production is
attributed to an 8% decrease in tonnes and a 23% decrease in gold
grade for ore placed on the pad, compared to the fourth quarter of
2021. This was partially offset by improved gold recovery. Gold
grade for the quarter was in line with the mining plan and Mineral
Reserve estimate. Mine production for the quarter was according to
management’s expectations, with a total of 1.9 million tonnes of
ore mined in the fourth quarter, at a strip ratio of 0.54:1.
Cash cost per ounce of gold for the three months
ended December 31, 2022 was $815 compared to $585 in the fourth
quarter of 2021. Cash cost per ounce of gold for the year ended
December 31, 2022 was $740 compared to $617 in the 2021. Cash cost
per ounce of gold was higher due higher operations costs primarily
due to inflation, lower stripping capitalization and lower gold
production.
All-in sustaining cash cost per gold ounce sold
was $1,221 during Q4 2022 and $1,142 in 2022 compared with $994 in
the fourth quarter of 2021 and $1,116 in 2021. All-in sustaining
cash cost for the fourth quarter of 2022 was impacted by the issues
described above, partially offset by lower export taxes and a
positive by-product effect.
Sustaining capital for the quarter primarily
consisted of spending on the leach pad, mine maintenance and other
minor projects. Construction work on Phase-2 is planned to commence
in 2023. Brownfields capital primarily relates to exploration at
the Arizaro project.
Yaramoko Mine Complex, Burkina Faso
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Mine Production |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
|
142,694 |
|
|
132,188 |
|
|
546,651 |
|
|
258,866 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
6.45 |
|
|
6.99 |
|
|
6.37 |
|
|
7.13 |
|
Recovery (%) |
|
|
98 |
|
|
98 |
|
|
98 |
|
|
98 |
|
Production (oz) |
|
|
26,190 |
|
|
28,787 |
|
|
106,108 |
|
|
57,538 |
|
Metal sold (oz) |
|
|
26,250 |
|
|
29,077 |
|
|
107,433 |
|
|
56,571 |
|
Realized price ($/oz) |
|
|
1,742 |
|
|
1,796 |
|
|
1,802 |
|
|
1,789 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash cost ($/oz Au)1 |
|
|
818 |
|
|
754 |
|
|
840 |
|
|
739 |
|
All-in sustaining cash cost ($/oz Au)1 |
|
|
1,829 |
|
|
1,436 |
|
|
1,529 |
|
|
1,317 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Capital expenditures ($000's)
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
|
18,994 |
|
|
13,520 |
|
|
45,665 |
|
|
21,387 |
|
Brownfields |
|
|
2,855 |
|
|
47 |
|
|
5,873 |
|
|
138 |
1 The Yaramoko Mine was acquired as part of the acquisition of
Roxgold which completed on July 2, 2021. Comparative figures in
2021 are included from July 2, 2021 onward.2 Cash cost and AISC are
non-IFRS financial measures. Refer to Non-IFRS Financial Measures
section at the end of this news release and to the MD&A
accompanying the Company’s financial statements filed on SEDAR at
www.sedar.com for a description of the calculation of these
measures.3 Capital expenditures are presented on a cash basis.
The Yaramoko Mine produced 26,190 ounces of gold
in the fourth quarter of 2022 with an average gold head grade of
6.45g/t, which is in line with the mining sequence and Mineral
Reserve estimate and an 8% decrease over Q4 2021. The decrease in
production was due to lower head grades. However, grades for the
full year were in line with planned estimates.
Cash cost per gold ounce sold was $818, compared
to $754 in the fourth quarter of 2021, and $840 for the year 2022
compared to $739 in 2021, primarily due to higher mining service
costs related to inflation and variation in orebody sequence. This
was partially offset by favorable foreign exchange rates.
All-in sustaining cash cost per gold ounce sold
was $1,829 for Q4 2022 and $1,529 for 2022, compared to $1,436 and
$1,317 for the same period in 2021, as a result of decreased
production, increased cash cost, and an increase in capital
expenditures.
Sustaining capital expenditure related mainly to
mine development, including the QV Prime project in Bagassi South.
Brownfields expenditure was higher due to greater amounts of
diamond drilling as well as further development of the 109
Zone.
San Jose Mine, Mexico
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Mine Production |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
|
259,500 |
|
|
262,802 |
|
|
1,029,590 |
|
|
1,041,154 |
|
Average tonnes milled per day |
|
|
2,883 |
|
|
2,920 |
|
|
2,925 |
|
|
2,964 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Silver |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
194 |
|
|
219 |
|
|
191 |
|
|
209 |
|
Recovery (%) |
|
|
91 |
|
|
93 |
|
|
91 |
|
|
92 |
|
Production (oz) |
|
|
1,473,627 |
|
|
1,717,533 |
|
|
5,762,562 |
|
|
6,425,029 |
|
Metal sold (oz) |
|
|
1,482,452 |
|
|
1,729,152 |
|
|
5,755,330 |
|
|
6,433,808 |
|
Realized price ($/oz) |
|
|
21.37 |
|
|
23.39 |
|
|
21.73 |
|
|
25.15 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
1.13 |
|
|
1.27 |
|
|
1.14 |
|
|
1.29 |
|
Recovery (%) |
|
|
90 |
|
|
92 |
|
|
90 |
|
|
91 |
|
Production (oz) |
|
|
8,499 |
|
|
9,929 |
|
|
34,124 |
|
|
39,406 |
|
Metal sold (oz) |
|
|
8,621 |
|
|
9,983 |
|
|
34,201 |
|
|
39,404 |
|
Realized price ($/oz) |
|
|
1,734 |
|
|
1,797 |
|
|
1,802 |
|
|
1,798 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Production cash cost ($/t)2 |
|
|
86.26 |
|
|
79.66 |
|
|
81.33 |
|
|
75.80 |
|
Production cash cost ($/oz Ag Eq)1,2 |
|
|
11.16 |
|
|
9.35 |
|
|
10.56 |
|
|
9.30 |
|
All-in sustaining cash cost ($/oz Ag Eq)1,2 |
|
|
15.53 |
|
|
14.92 |
|
|
15.11 |
|
|
14.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Capital expenditures ($000's)
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
|
3,695 |
|
|
5,137 |
|
|
15,731 |
|
|
14,492 |
|
Non-sustaining |
|
|
– |
|
|
518 |
|
|
869 |
|
|
2,294 |
|
Brownfields |
|
|
961 |
|
|
2,176 |
|
|
5,606 |
|
|
8,784 |
1 Production cash cost silver equivalent and
All-in sustaining cash cost silver equivalent are calculated using
realized metal prices for each period respectively.2 Production
cash cost, Production cash cost silver equivalent, and All-in
sustaining cash cost silver equivalent are Non-IFRS Financial
Measures, refer to Non-IFRS Financial Measures section at the end
of this news release and to the MD&A accompanying the Company’s
financial statements filed on SEDAR at www.sedar.com for a
description of the calculation of these measures.3 Capital
expenditures are presented on a cash basis.
In the fourth quarter of 2022, the San Jose Mine
produced 1,473,627 ounces of silver and 8,499 ounces of gold, 14%
and 14% lower, respectively, when compared to the equivalent period
in 2021. The decrease is mainly due to lower head grades, albeit in
line with management´s expectations based on the mining sequence
and Mineral Reserve estimate.
Material mined using sublevel stopping (SLS)
methods was increased in 2022, representing 35 percent of ore sent
to the plant. The operation plans for the SLS contribution to reach
60 percent of total ore production in 2023. In the second quarter
of 2022, a new underground shotcrete plant was commissioned which
reduced mining cycles and partially offset some of the cost
increases due to higher haulage distances as the mine deepens.
The cash cost per tonne for the three months
ended December 31, 2022 was $86.26 compared to $79.66 in the same
period in 2021 primarily due to cost increases related to inflation
and higher support costs. Cash cost per tonne for the full year
2022 increased to $81.33 per tonne compared to $75.80 per tonne for
2021 due to higher mine preparation, support and indirect
costs.
All-in sustaining cash costs of payable silver
equivalent for the three months ended December 31, 2022 and full
year 2022 increased 4% and 5% to $15.53 per ounce and 15.11 per
ounce, compared to the same periods in 2021. The increases are due
to higher cash costs and lower silver equivalent ounces, partially
offset by lower capital expenditure.
Sustaining capital expenditures for Q4 2022 and
for the year were lower than 2021, as 2021 required additional
capital for equipment. Brownfields capital expenditure were lower
due to reduced drilling, as the site focused on less
capital-intensive exploration.
Caylloma Mine, Peru
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Mine Production |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
|
138,491 |
|
|
137,838 |
|
|
546,186 |
|
|
539,779 |
|
Average tonnes milled per day |
|
|
1,556 |
|
|
1,549 |
|
|
1,539 |
|
|
1,525 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Silver |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
75 |
|
|
73 |
|
|
80 |
|
|
76 |
|
Recovery (%) |
|
|
81 |
|
|
81 |
|
|
81 |
|
|
82 |
|
Production (oz) |
|
|
273,119 |
|
|
262,710 |
|
|
1,144,713 |
|
|
1,073,672 |
|
Metal sold (oz) |
|
|
289,870 |
|
|
243,869 |
|
|
1,156,381 |
|
|
1,074,364 |
|
Realized price ($/oz) |
|
|
21.28 |
|
|
23.39 |
|
|
21.81 |
|
|
25.25 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
|
0.12 |
|
|
0.44 |
|
|
0.14 |
|
|
0.49 |
|
Recovery (%) |
|
|
22 |
|
|
70 |
|
|
32 |
|
|
71 |
|
Production (oz) |
|
|
122 |
|
|
1,374 |
|
|
777 |
|
|
6,086 |
|
Metal sold (oz) |
|
|
— |
|
|
1,297 |
|
|
603 |
|
|
6,140 |
|
Realized price ($/oz) |
|
|
— |
|
|
1,798 |
|
|
1,864 |
|
|
1,792 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Lead |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (%) |
|
|
3.22 |
|
|
3.20 |
|
|
3.27 |
|
|
3.16 |
|
Recovery (%) |
|
|
89 |
|
|
87 |
|
|
88 |
|
|
88 |
|
Production (000's lbs) |
|
|
8,735 |
|
|
8,419 |
|
|
34,588 |
|
|
32,990 |
|
Metal sold (000's lbs) |
|
|
9,118 |
|
|
7,945 |
|
|
34,869 |
|
|
33,299 |
|
Realized price ($/lb) |
|
|
0.96 |
|
|
1.06 |
|
|
0.98 |
|
|
1.00 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Zinc |
|
|
|
|
|
|
|
|
|
|
|
|
|
Grade (%) |
|
|
4.63 |
|
|
4.25 |
|
|
4.32 |
|
|
4.56 |
|
Recovery (%) |
|
|
89 |
|
|
87 |
|
|
89 |
|
|
88 |
|
Production (000's lbs) |
|
|
12,575 |
|
|
11,380 |
|
|
46,176 |
|
|
47,549 |
|
Metal sold (000's lbs) |
|
|
11,027 |
|
|
11,053 |
|
|
44,770 |
|
|
47,828 |
|
Realized price ($/lb) |
|
|
1.35 |
|
|
1.51 |
|
|
1.57 |
|
|
1.36 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Production cash cost ($/t)2 |
|
|
95.70 |
|
|
97.87 |
|
|
92.96 |
|
|
88.41 |
|
Production cash cost ($/oz Ag Eq)1,2 |
|
|
12.46 |
|
|
13.83 |
|
|
12.34 |
|
|
13.46 |
|
All-in sustaining cash cost ($/oz Ag Eq)1,2 |
|
|
20.30 |
|
|
20.71 |
|
|
17.97 |
|
|
18.94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Capital expenditures ($000's)
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
|
7,188 |
|
|
5,755 |
|
|
18,694 |
|
|
13,758 |
|
Brownfields |
|
|
473 |
|
|
1,027 |
|
|
1,202 |
|
|
3,731 |
1 Production cash cost silver equivalent and
All-in sustaining cash cost silver equivalent are calculated using
realized metal prices for each period respectively.2 Production
cash cost, Production cash cost silver equivalent, and All-in
sustaining cash cost silver equivalent are Non-IFRS Financial
Measures, refer to Non-IFRS Financial Measures section at the end
of this news release and to the MD&A accompanying the Company’s
financial statements filed on SEDAR at www.sedar.com for a
description of the calculation of these measures.3 Capital
expenditures are presented on a cash basis.
The Caylloma Mine produced 273,119 ounces of
silver, 8.7 million pounds of lead, and 12.6 million pounds of zinc
during the three months ended December 31, 2022. Measured against
the comparable quarter of the previous year, silver was 4% higher,
primarily due to higher grades mined during the period. Lead
production was 4% higher than the comparable period, attributable
to higher plant recovery. Zinc production was 11% higher than the
comparable period, mainly impacted by higher head grades and
improved plant recovery. Gold production totaled 122 ounces with an
average head grade of 0.12 g/t.
The cash cost per tonne of processed ore for the
three months ended December 31, 2022 increased 2% to $95.70
compared to $97.87 in the same period in 2021. This movement was
mainly the result of higher support costs partially offset by
increased production. Cash cost per tonne for the full year 2022
increased to $92.96 per tonne compared to $88.41 per tonne for
2021, mainly due to higher mining costs caused by inflation.
The all-in sustaining cash cost of payable
silver equivalent for the three month ended December 31, 2022
decreased 2% to $20.30 per ounce compared to $20.71 per ounce for
the same period in 2021, as a result of higher sustaining capital
expenditures in the quarter. The all-in sustaining cash cost
of payable silver equivalent for the full year 2022 decreased 5% to
$17.97 per ounce compared to $18.94 per ounce in 2021 was primarily
due to an increase in silver equivalent ounces due to a decrease in
realized silver prices, partially offset by higher capital
costs.
Sustaining capital expenditures for the quarter
increased primarily due to greater investments in sustaining
equipment and infrastructure. Expenditures on the developments
located in level 16 and level 18 were offset by decreased
expenditures on other levels. The decrease in Brownfields capital
expenditures was due to significantly lower spending on drilling
and development.
Qualified Person
Eric Chapman, Senior Vice President of Technical
Services, is a Professional Geoscientist of the Association of
Professional Engineers and Geoscientists of the Province of British
Columbia (Registration Number 36328), and is the Company’s
Qualified Person (as defined by National Instrument 43-101). Mr.
Chapman has reviewed and approved the scientific and technical
information contained in this news release and has verified the
underlying data.
Non-IFRS Financial Measures
The Company has disclosed certain financial
measures and ratios in this news release which are not defined
under the International Financial Reporting Standards (“IFRS”), as
issued by the International Accounting Standards Board, and are not
disclosed in the Company's financial statements, including but not
limited to: cash cost per ounce of gold sold; all-in sustaining
cash cost per ounce of gold sold; all-in cash cost per ounce of
gold sold; total production cash cost per tonne; cash cost per
payable ounce of silver equivalent sold; all-in sustaining cash
cost per payable ounce of silver equivalent sold; all-in cash cost
per payable ounce of silver equivalent sold; free cash flow from
ongoing operations; adjusted net income; adjusted EBITDA and
working capital.
These non-IFRS financial measures and non-IFRS
ratios are widely reported in the mining industry as benchmarks for
performance and are used by management to monitor and evaluate the
Company's operating performance and ability to generate cash. The
Company believes that, in addition to financial measures and ratios
prepared in accordance with IFRS, certain investors use these
non-IFRS financial measures and ratios to evaluate the Company’s
performance. However, the measures do not have a standardized
meaning under IFRS and may not be comparable to similar financial
measures disclosed by other companies. Accordingly, non-IFRS
financial measures and non-IFRS ratios should not be considered in
isolation or as a substitute for measures and ratios of the
Company’s performance prepared in accordance with IFRS. The Company
has calculated these measures consistently for all periods
presented.
To facilitate a better understanding of these
measures and ratios as calculated by the Company, descriptions are
provided below. In addition, see “Non-IFRS Financial Measures” in
the Company’s management’s discussion and analysis for the fiscal
year ended December 31, 2022 (“2022 MD&A”), which section is
incorporated by reference in this news release, for additional
information regarding each non-IFRS financial measure and non-IFRS
ratio disclosed in this news release, including an explanation of
their composition; an explanation of how such measures and ratios
provide useful information to an investor and the additional
purposes, if any, for which management of Fortuna uses such
measures and ratio. The 2022 MD&A may be accessed on SEDAR at
www.sedar.com under the Company’s profile, Fortuna Silver Mines
Inc.
Except as otherwise described in the Q4 2022
MD&A, the Company has calculated these measures consistently
for all periods presented.
Reconciliation to Adjusted Net Income for the Three and
Twelve Months Ended December 31, 2022 and 2021
| |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
Consolidated (in millions of US dollars) |
|
2022 |
|
|
|
2021 |
|
|
2022 |
|
|
|
2021 |
| Net (loss) income |
|
(160.4 |
) |
|
|
16.6 |
|
|
(135.9 |
) |
|
|
59.4 |
|
Adjustments, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
Community support provision and accruals1 |
|
(0.1 |
) |
|
|
1.3 |
|
|
(0.1 |
) |
|
|
1.4 |
|
Foreign exchange loss, Lindero Mine2 |
|
- |
|
|
|
0.3 |
|
|
- |
|
|
|
4.1 |
|
Foreign exchange loss, Séguéla Project |
|
(0.4 |
) |
|
|
- |
|
|
0.8 |
|
|
|
- |
|
Write off of mineral properties |
|
0.3 |
|
|
|
- |
|
|
5.1 |
|
|
|
- |
|
Unrealized loss (gain) on derivatives |
|
0.1 |
|
|
|
- |
|
|
(0.4 |
) |
|
|
- |
|
Impairment of mineral properties, plant and equipment |
|
164.5 |
|
|
|
- |
|
|
164.5 |
|
|
|
- |
|
Roxgold transaction costs |
|
- |
|
|
|
- |
|
|
- |
|
|
|
14.1 |
|
SGM Royalty settlement |
|
- |
|
|
|
1.0 |
|
|
- |
|
|
|
9.8 |
|
Inventory adjustment |
|
3.8 |
|
|
|
4.6 |
|
|
8.0 |
|
|
|
6.3 |
|
Accretion on right of use assets |
|
0.5 |
|
|
|
1.0 |
|
|
2.3 |
|
|
|
2.2 |
|
Other non-cash/non-recurring items |
|
(1.1 |
) |
|
|
4.3 |
|
|
(1.7 |
) |
|
|
3.3 |
|
Adjusted Net Income |
|
7.2 |
|
|
|
29.1 |
|
|
42.6 |
|
|
|
100.6 |
| 1 Amounts are
recorded in Cost of
sales |
| 2 Amounts are
recorded in General and
Administration |
| Figures may not
add due to
rounding |
Reconciliation to Adjusted EBITDA for
the Three and Twelve Months Ended December 31, 2022 and
2021
| |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
Consolidated (in millions of US dollars) |
|
2022 |
|
|
|
2021 |
|
|
2022 |
|
|
|
2021 |
| Net (loss) income |
|
(160.4 |
) |
|
|
16.6 |
|
|
(135.9 |
) |
|
|
59.4 |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Community support provision and accruals |
|
(0.1 |
) |
|
|
2.1 |
|
|
(0.1 |
) |
|
|
1.9 |
|
Inventory adjustment |
|
3.8 |
|
|
|
5.3 |
|
|
8.9 |
|
|
|
7.0 |
|
Foreign exchange loss, Lindero Mine |
|
- |
|
|
|
0.3 |
|
|
- |
|
|
|
4.1 |
|
Foreign exchange loss, Séguéla Project |
|
(0.4 |
) |
|
|
0.2 |
|
|
0.8 |
|
|
|
0.2 |
|
Net finance items |
|
3.1 |
|
|
|
3.7 |
|
|
12.1 |
|
|
|
12.3 |
|
Depreciation, depletion, and amortization |
|
45.3 |
|
|
|
44.8 |
|
|
172.8 |
|
|
|
122.3 |
|
Income taxes |
|
(15.3 |
) |
|
|
13.5 |
|
|
10.8 |
|
|
|
47.7 |
|
Impairment of mineral properties, plant and equipment |
|
182.8 |
|
|
|
- |
|
|
182.8 |
|
|
|
- |
|
SGM Royalty settlement |
|
- |
|
|
|
- |
|
|
- |
|
|
|
9.6 |
|
Roxgold transaction costs |
|
- |
|
|
|
- |
|
|
- |
|
|
|
14.1 |
|
Other non-cash/non-recurring items |
|
(3.0 |
) |
|
|
3.1 |
|
|
(6.7 |
) |
|
|
2.1 |
|
Adjusted EBITDA |
|
55.8 |
|
|
|
89.6 |
|
|
245.5 |
|
|
|
280.7 |
Figures may not add due to rounding
Reconciliation of Free Cash Flow from
ongoing operations for the Three and Twelve Months Ended December
30, 2022 and 2021
In 2022, the Company changed the method for
calculating Free Cash Flow from Ongoing Operations. The calculation
now uses taxes paid as opposed to the previous method which used
current income taxes. While this may create larger quarter over
quarter fluctuations due to the timing of income tax payments,
management believes the revised method is a better representation
of the Free Cash Flow generated by the Company’s ongoing
operations. Comparative values from 2021 have been restated using
the change in the methodology.
| |
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
Consolidated (in millions of US dollars) |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| |
|
|
|
|
(Restated) |
|
|
|
|
|
|
(Restated) |
|
| Net cash provided by operating
activities |
|
49.6 |
|
|
|
57.1 |
|
|
|
194.2 |
|
|
|
147.1 |
|
| Adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
Roxgold transaction costs |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
27.9 |
|
|
Additions to mineral properties, plant and equipment |
|
(39.6 |
) |
|
|
(35.3 |
) |
|
|
(113.4 |
) |
|
|
(90.7 |
) |
|
Mexican royalty payment |
|
- |
|
|
|
9.5 |
|
|
|
3.0 |
|
|
|
11.1 |
|
|
Other adjustments |
|
(5.6 |
) |
|
|
(3.1 |
) |
|
|
(14.6 |
) |
|
|
(9.4 |
) |
| Free
cash flow from ongoing operations |
|
4.4 |
|
|
|
28.2 |
|
|
|
69.2 |
|
|
|
86.0 |
|
Figures may not add due to rounding
Reconciliation of Cash Cost per Ounce of Gold Sold for
the Three and Twelve Months Ended December 31, 2022 and
2021
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Lindero
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Cost of sales |
|
|
43,057 |
|
|
|
46,915 |
|
|
|
164,179 |
|
|
|
122,889 |
|
| Changes in doré inventory |
|
|
1,379 |
|
|
|
353 |
|
|
|
1,984 |
|
|
|
2,066 |
|
| Inventory adjustment |
|
|
(1,691 |
) |
|
|
(1,072 |
) |
|
|
(1,691 |
) |
|
|
(2,815 |
) |
| Export duties |
|
|
(3,353 |
) |
|
|
(4,891 |
) |
|
|
(15,545 |
) |
|
|
(13,410 |
) |
| Depletion and
depreciation |
|
|
(13,441 |
) |
|
|
(19,154 |
) |
|
|
(54,644 |
) |
|
|
(43,665 |
) |
| By
product credits |
|
|
(982 |
) |
|
|
(77 |
) |
|
|
(1,214 |
) |
|
|
(260 |
) |
| Production cash cost1 |
|
|
24,969 |
|
|
|
22,074 |
|
|
|
93,069 |
|
|
|
64,805 |
|
| Changes in doré inventory |
|
|
(1,379 |
) |
|
|
(353 |
) |
|
|
(1,984 |
) |
|
|
(2,066 |
) |
|
Realized gain in diesel hedge |
|
|
(1,105 |
) |
|
|
(438 |
) |
|
|
(4,620 |
) |
|
|
(963 |
) |
| Cash cost applicable per gold
ounce sold |
A |
|
22,485 |
|
|
|
21,283 |
|
|
|
86,465 |
|
|
|
61,776 |
|
| Ounces
of gold sold |
B |
|
27,602 |
|
|
|
36,375 |
|
|
|
116,795 |
|
|
|
100,137 |
|
| Cash
cost per ounce of gold sold1 ($/oz) |
=A/B |
|
815 |
|
|
|
585 |
|
|
|
740 |
|
|
|
617 |
|
| |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Yaramoko
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Cost of sales |
|
|
42,084 |
|
|
|
42,381 |
|
|
|
171,846 |
|
|
|
80,812 |
|
| Changes in doré inventory |
|
|
- |
|
|
|
719 |
|
|
|
(1,320 |
) |
|
|
1,542 |
|
| Inventory net realizable value
adjustment |
|
|
- |
|
|
|
(4,153 |
) |
|
|
(5,077 |
) |
|
|
(4,153 |
) |
| Export duties |
|
|
(2,732 |
) |
|
|
(3,018 |
) |
|
|
(11,630 |
) |
|
|
(5,993 |
) |
| Depletion and
depreciation |
|
|
(17,884 |
) |
|
|
(13,235 |
) |
|
|
(64,894 |
) |
|
|
(28,974 |
) |
| Refining charges |
|
|
- |
|
|
|
- |
|
|
|
(329 |
) |
|
|
- |
|
| By
product credits |
|
|
- |
|
|
|
(195 |
) |
|
|
(25 |
) |
|
|
(134 |
) |
| Production cash cost |
|
|
21,468 |
|
|
|
22,499 |
|
|
|
88,571 |
|
|
|
43,100 |
|
| Changes in doré inventory |
|
|
- |
|
|
|
(719 |
) |
|
|
1,320 |
|
|
|
(1,542 |
) |
|
Refining charges |
|
|
- |
|
|
|
133 |
|
|
|
329 |
|
|
|
271 |
|
| Cash cost applicable per gold
ounce sold |
A |
|
21,468 |
|
|
|
21,913 |
|
|
|
90,220 |
|
|
|
41,829 |
|
| Ounces
of gold sold |
B |
|
26,250 |
|
|
|
29,077 |
|
|
|
107,433 |
|
|
|
56,571 |
|
| Cash
cost per ounce of gold sold ($/oz) |
=A/B |
|
818 |
|
|
|
754 |
|
|
|
840 |
|
|
|
739 |
|
| The Yaramoko Mine
was acquired as part of the acquisition of Roxgold which completed
on July 2, 2021. Comparative figures in 2021 are included from July
2, 2021 onward. |
Reconciliation of All-in Sustaining Cash Cost per Ounce
of Gold Sold for the Three and Twelve Months Ended December 31,
2022 and 2021
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Lindero
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
|
2021 |
|
|
2022 |
|
|
|
2021 |
| Cash cost applicable |
|
|
22,484 |
|
|
|
21,283 |
|
|
86,464 |
|
|
|
61,776 |
| Inventory net realizable value
adjustment |
|
|
2,351 |
|
|
|
- |
|
|
2,351 |
|
|
|
- |
| Long-term inventory NRV |
|
|
(1,299 |
) |
|
|
- |
|
|
(1,299 |
) |
|
|
- |
| Export duties and mining
taxes |
|
|
3,353 |
|
|
|
4,891 |
|
|
15,545 |
|
|
|
13,410 |
| General
and administrative expenses (operations) |
|
|
2,081 |
|
|
|
1,640 |
|
|
8,578 |
|
|
|
5,643 |
| Adjusted operating cash
cost |
|
|
28,970 |
|
|
|
27,814 |
|
|
111,639 |
|
|
|
80,829 |
| Sustaining leases |
|
|
567 |
|
|
|
752 |
|
|
2,398 |
|
|
|
2,548 |
| Sustaining capital
expenditures1 |
|
|
3,973 |
|
|
|
7,214 |
|
|
18,035 |
|
|
|
27,522 |
|
Brownfields exploration expenditures1 |
|
|
184 |
|
|
|
389 |
|
|
1,288 |
|
|
|
875 |
| All-in sustaining cash
cost |
|
|
33,694 |
|
|
|
36,169 |
|
|
133,360 |
|
|
|
111,774 |
|
Non-sustaining capital expenditures1 |
|
|
- |
|
|
|
233 |
|
|
169 |
|
|
|
323 |
| All-in cash cost |
|
|
33,694 |
|
|
|
36,402 |
|
|
133,529 |
|
|
|
112,097 |
| Ounces
of gold sold |
|
|
27,602 |
|
|
|
36,375 |
|
|
116,795 |
|
|
|
100,137 |
| All-in
sustaining cash cost per ounce of gold sold |
|
|
1,221 |
|
|
|
994 |
|
|
1,142 |
|
|
|
1,116 |
| All-in
cash cost per ounce of gold sold |
|
|
1,221 |
|
|
|
1,001 |
|
|
1,143 |
|
|
|
1,119 |
| 1 Presented on a
cash basis |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Yaramoko
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Cash cost applicable |
|
|
21,468 |
|
|
21,913 |
|
|
90,220 |
|
|
41,829 |
| Inventory net realizable value
adjustment |
|
|
- |
|
|
1,285 |
|
|
3,125 |
|
|
1,285 |
| Export duties and mining
taxes |
|
|
2,732 |
|
|
3,018 |
|
|
11,630 |
|
|
5,993 |
| General
and administrative expenses (operations) |
|
|
531 |
|
|
514 |
|
|
2,101 |
|
|
953 |
| Adjusted operating cash
cost |
|
|
24,731 |
|
|
26,730 |
|
|
107,076 |
|
|
50,060 |
| Sustaining leases |
|
|
1,419 |
|
|
1,467 |
|
|
5,692 |
|
|
2,934 |
| Sustaining capital
expenditures1 |
|
|
18,994 |
|
|
13,520 |
|
|
45,665 |
|
|
21,387 |
|
Brownfields exploration expenditures1 |
|
|
2,855 |
|
|
47 |
|
|
5,873 |
|
|
138 |
| All-in
sustaining cash cost |
|
|
47,999 |
|
|
41,764 |
|
|
164,306 |
|
|
74,519 |
| All-in cash cost |
|
|
47,999 |
|
|
41,764 |
|
|
164,306 |
|
|
74,519 |
| Ounces
of gold sold |
|
|
26,250 |
|
|
29,077 |
|
|
107,433 |
|
|
56,571 |
| All-in
sustaining cash cost per ounce of gold sold |
|
|
1,829 |
|
|
1,436 |
|
|
1,529 |
|
|
1,317 |
| All-in
cash cost per ounce of gold sold |
|
|
1,829 |
|
|
1,436 |
|
|
1,529 |
|
|
1,317 |
| The Yaramoko Mine
was acquired as part of the acquisition of Roxgold which completed
on July 2, 2021. Comparative figures in 2021 are included from July
2, 2021 onward. |
| 1 Presented on a
cash basis |
Reconciliation of Production Cash Cost per Tonne and
Cash Cost per Payable Ounce of Silver Equivalent Sold for the Three
and Twelve Months Ended December 31, 2022 and 2021
| |
|
|
|
|
|
|
|
|
|
|
|
|
| San Jose
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Cost of sales |
|
|
34,775 |
|
|
|
32,705 |
|
|
|
129,088 |
|
|
|
122,756 |
|
| Changes in concentrate
inventory |
|
|
156 |
|
|
|
(118 |
) |
|
|
19 |
|
|
|
163 |
|
| Depletion and depreciation in
concentrate inventory |
|
|
(47 |
) |
|
|
11 |
|
|
|
2 |
|
|
|
32 |
|
| Inventory adjustment |
|
|
(129 |
) |
|
|
(52 |
) |
|
|
137 |
|
|
|
(6 |
) |
| Royalties and mining
taxes |
|
|
(1,260 |
) |
|
|
(1,587 |
) |
|
|
(5,262 |
) |
|
|
(5,955 |
) |
| Workers participation |
|
|
(601 |
) |
|
|
(1,236 |
) |
|
|
(2,477 |
) |
|
|
(5,809 |
) |
|
Depletion and depreciation |
|
|
(10,510 |
) |
|
|
(8,789 |
) |
|
|
(37,775 |
) |
|
|
(32,257 |
) |
| Cash cost3 |
A |
|
22,384 |
|
|
|
20,934 |
|
|
|
83,732 |
|
|
|
78,924 |
|
| Total
processed ore (tonnes) |
B |
|
259,500 |
|
|
|
262,802 |
|
|
|
1,029,590 |
|
|
|
1,041,154 |
|
|
Production cash cost per tonne3 ($/t) |
=A/B |
|
86.26 |
|
|
|
79.66 |
|
|
|
81.33 |
|
|
|
75.80 |
|
| Cash cost3 |
A |
|
22,384 |
|
|
|
20,934 |
|
|
|
83,732 |
|
|
|
78,924 |
|
| Changes in concentrate
inventory |
|
|
(156 |
) |
|
|
118 |
|
|
|
(19 |
) |
|
|
(163 |
) |
| Depletion and depreciation in
concentrate inventory |
|
|
47 |
|
|
|
(11 |
) |
|
|
(2 |
) |
|
|
(32 |
) |
| Inventory adjustment |
|
|
129 |
|
|
|
52 |
|
|
|
(137 |
) |
|
|
6 |
|
| Treatment charges |
|
|
(65 |
) |
|
|
190 |
|
|
|
(293 |
) |
|
|
(251 |
) |
|
Refining charges |
|
|
1,012 |
|
|
|
1,157 |
|
|
|
3,801 |
|
|
|
4,318 |
|
| Cash cost applicable per
payable ounce sold3 |
C |
|
23,351 |
|
|
|
22,440 |
|
|
|
87,082 |
|
|
|
82,802 |
|
| Payable
ounces of silver equivalent sold1 |
D |
|
2,092,500 |
|
|
|
2,400,989 |
|
|
|
8,243,436 |
|
|
|
8,902,680 |
|
| Cash
cost per ounce of payable silver equivalent sold2,3 ($/oz) |
=C/D |
|
11.16 |
|
|
|
9.35 |
|
|
|
10.56 |
|
|
|
9.30 |
|
| Mining cost per tonne3 |
|
|
37.25 |
|
|
|
37.90 |
|
|
|
37.43 |
|
|
|
38.74 |
|
| Milling cost per tonne |
|
|
18.94 |
|
|
|
16.56 |
|
|
|
18.79 |
|
|
|
16.68 |
|
| Indirect cost per tonne |
|
|
20.98 |
|
|
|
16.84 |
|
|
|
16.86 |
|
|
|
13.72 |
|
| Community relations cost per
tonne |
|
|
4.01 |
|
|
|
5.15 |
|
|
|
2.92 |
|
|
|
4.79 |
|
|
Distribution cost per tonne |
|
|
5.08 |
|
|
|
3.20 |
|
|
|
5.33 |
|
|
|
1.88 |
|
|
Production cash cost per tonne3 ($/t) |
|
|
86.26 |
|
|
|
79.66 |
|
|
|
81.33 |
|
|
|
75.80 |
|
| 1 Silver
equivalent sold for Q4 2022 is calculated using a silver to gold
ratio of 81.2:1 (Q4 2021: 76.8:1). Silver equivalent sold for 2022
is calculated using a silver to gold ratio of 82.9:1 (2021:
71.5:1). |
| 2 Silver
equivalent is calculated using the realized prices for gold and
silver. Refer to Financial Results – Sales and Realized Prices |
| 3 2021 restated,
Sustaining leases moved to All-In Sustaining |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Caylloma
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Cost of sales |
|
|
16,676 |
|
|
|
18,585 |
|
|
|
67,491 |
|
|
|
67,917 |
|
| Changes in concentrate
inventory |
|
|
(229 |
) |
|
|
939 |
|
|
|
(218 |
) |
|
|
297 |
|
| Depletion and depreciation in
concentrate inventory |
|
|
120 |
|
|
|
165 |
|
|
|
(76 |
) |
|
|
61 |
|
| Inventory adjustment |
|
|
445 |
|
|
|
(61 |
) |
|
|
266 |
|
|
|
(61 |
) |
| Royalties and mining
taxes |
|
|
(181 |
) |
|
|
(188 |
) |
|
|
(867 |
) |
|
|
(345 |
) |
| Provision for community
support |
|
|
(78 |
) |
|
|
(2,125 |
) |
|
|
19 |
|
|
|
(2,125 |
) |
| Workers participation |
|
|
(419 |
) |
|
|
(214 |
) |
|
|
(1,808 |
) |
|
|
(1,838 |
) |
|
Depletion and depreciation |
|
|
(3,080 |
) |
|
|
(3,607 |
) |
|
|
(14,032 |
) |
|
|
(16,182 |
) |
| Cash cost3 |
A |
|
13,254 |
|
|
|
13,494 |
|
|
|
50,775 |
|
|
|
47,724 |
|
| Total
processed ore (tonnes) |
B |
|
138,491 |
|
|
|
137,838 |
|
|
|
546,186 |
|
|
|
539,779 |
|
|
Production cash cost per tonne3 ($/t) |
=A/B |
|
95.70 |
|
|
|
97.89 |
|
|
|
92.96 |
|
|
|
88.41 |
|
| Cash cost |
A |
|
13,254 |
|
|
|
13,494 |
|
|
|
50,775 |
|
|
|
47,724 |
|
| Changes in concentrate
inventory |
|
|
229 |
|
|
|
(939 |
) |
|
|
218 |
|
|
|
(297 |
) |
| Depletion and depreciation in
concentrate inventory |
|
|
(120 |
) |
|
|
(165 |
) |
|
|
76 |
|
|
|
(61 |
) |
| Inventory adjustment |
|
|
(445 |
) |
|
|
61 |
|
|
|
(266 |
) |
|
|
61 |
|
| Treatment charges |
|
|
2,744 |
|
|
|
4,629 |
|
|
|
13,939 |
|
|
|
15,754 |
|
|
Refining charges |
|
|
384 |
|
|
|
378 |
|
|
|
1,537 |
|
|
|
1,670 |
|
| Cash cost applicable per
payable ounce sold3 |
C |
|
16,046 |
|
|
|
17,458 |
|
|
|
66,279 |
|
|
|
64,851 |
|
| Payable
ounces of silver equivalent sold1 |
D |
|
1,287,998 |
|
|
|
1,261,967 |
|
|
|
5,372,277 |
|
|
|
4,819,365 |
|
| Cash
cost per ounce of payable silver equivalent sold2,3 ($/oz) |
=C/D |
|
12.46 |
|
|
|
13.83 |
|
|
|
12.34 |
|
|
|
13.46 |
|
| Mining cost per tonne |
|
|
40.47 |
|
|
|
42.02 |
|
|
|
39.39 |
|
|
|
34.71 |
|
| Milling cost per tonne |
|
|
13.74 |
|
|
|
16.27 |
|
|
|
14.86 |
|
|
|
15.34 |
|
| Indirect cost per tonne |
|
|
32.10 |
|
|
|
29.45 |
|
|
|
30.16 |
|
|
|
29.49 |
|
| Community relations cost per
tonne |
|
|
1.80 |
|
|
|
7.96 |
|
|
|
1.15 |
|
|
|
7.77 |
|
|
Distribution cost per tonne |
|
|
7.59 |
|
|
|
2.18 |
|
|
|
7.40 |
|
|
|
1.10 |
|
|
Production cash cost per tonne3 ($/t) |
|
|
95.70 |
|
|
|
97.87 |
|
|
|
92.96 |
|
|
|
88.41 |
|
| 1 Silver
equivalent sold for Q4 2022 is calculated using a silver to gold
ratio of 0.0:1 (Q4 2021: 76.9:1), silver to lead ratio of 1:22.3
pounds (Q4 2021: 1:22.2), and silver to zinc ratio of 1:15.7 pounds
(Q4 2021: 1:15.4). Silver equivalent sold for 2022 is calculated
using a silver to gold ratio of 85.5:1 (2021: 70.9:1), silver to
lead ratio of 1:22.2 pounds (2021: 1:25.3), and silver to zinc
ratio of 1:13.9 pounds (2021: 1:18.6). |
| 2 Silver
equivalent is calculated using the realized prices for gold,
silver, lead, and zinc. Refer to Financial Results - Sales and
Realized Prices |
| 3 2021 restated,
Sustaining leases moved to All-In Sustaining |
Reconciliation of All-in Sustaining Cash
Cost and All-in Cash Cost per Payable Ounce of Silver Equivalent
Sold for the Three and Twelve Months Ended December 31, 2022 and
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| San Jose
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Cash cost applicable4 |
|
|
23,351 |
|
|
22,440 |
|
|
87,082 |
|
|
82,802 |
| Royalties and mining
taxes |
|
|
1,260 |
|
|
1,587 |
|
|
5,262 |
|
|
5,955 |
| Workers' participation |
|
|
751 |
|
|
1,545 |
|
|
3,096 |
|
|
7,261 |
| General
and administrative expenses (operations) |
|
|
2,319 |
|
|
2,779 |
|
|
7,164 |
|
|
8,111 |
| Adjusted operating cash
cost4 |
|
|
27,681 |
|
|
28,351 |
|
|
102,604 |
|
|
104,129 |
| Sustaining leases4 |
|
|
169 |
|
|
161 |
|
|
658 |
|
|
608 |
| Sustaining capital
expenditures3 |
|
|
3,695 |
|
|
5,137 |
|
|
15,731 |
|
|
14,492 |
|
Brownfields exploration expenditures3 |
|
|
961 |
|
|
2,176 |
|
|
5,606 |
|
|
8,784 |
| All-in sustaining cash
cost |
|
|
32,506 |
|
|
35,825 |
|
|
124,599 |
|
|
128,013 |
|
Non-sustaining capital expenditures3 |
|
|
- |
|
|
518 |
|
|
869 |
|
|
2,294 |
| All-in cash cost |
|
|
32,506 |
|
|
36,343 |
|
|
125,468 |
|
|
130,307 |
| Payable
ounces of silver equivalent sold1 |
|
|
2,092,500 |
|
|
2,400,989 |
|
|
8,243,436 |
|
|
8,902,680 |
| All-in
sustaining cash cost per ounce of payable silver equivalent
sold2 |
|
|
15.53 |
|
|
14.92 |
|
|
15.11 |
|
|
14.38 |
| All-in
cash cost per ounce of payable silver equivalent sold2 |
|
|
15.53 |
|
|
15.14 |
|
|
15.22 |
|
|
14.64 |
| 1 Silver
equivalent sold for Q4 2022 is calculated using a silver to gold
ratio of 81.2:1 (Q4 2021: 76.8:1). Silver equivalent sold for 2022
is calculated using a silver to gold ratio of 82.9:1 (2021:
71.5:1). |
| 2 Silver
equivalent is calculated using the realized prices for gold and
silver. Refer to Financial Results - Sales and Realized Prices |
| 3 Presented on a
cash basis |
| 4 2021 restated,
Sustaining leases moved from Cash Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Caylloma
Mine |
|
|
Three months ended December 31, |
|
|
Years ended December 31, |
|
(Expressed in $'000's, except unit costs) |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
| Cash cost applicable4 |
|
|
16,046 |
|
|
17,458 |
|
|
66,279 |
|
|
64,851 |
| Royalties and mining
taxes |
|
|
181 |
|
|
188 |
|
|
867 |
|
|
345 |
| Workers' participation |
|
|
480 |
|
|
244 |
|
|
2,087 |
|
|
2,129 |
| General
and administrative expenses (operations) |
|
|
928 |
|
|
786 |
|
|
4,063 |
|
|
3,625 |
| Adjusted operating cash
cost4 |
|
|
17,635 |
|
|
18,676 |
|
|
73,296 |
|
|
70,950 |
| Sustaining leases4 |
|
|
845 |
|
|
681 |
|
|
3,350 |
|
|
2,851 |
| Sustaining capital
expenditures3 |
|
|
7,188 |
|
|
5,755 |
|
|
18,694 |
|
|
13,758 |
|
Brownfields exploration expenditures3 |
|
|
473 |
|
|
1,027 |
|
|
1,202 |
|
|
3,731 |
| All-in
sustaining cash cost |
|
|
26,141 |
|
|
26,139 |
|
|
96,542 |
|
|
91,290 |
| All-in cash cost |
|
|
26,141 |
|
|
26,139 |
|
|
96,542 |
|
|
91,290 |
| Payable
ounces of silver equivalent sold1 |
|
|
1,287,998 |
|
|
1,261,967 |
|
|
5,372,277 |
|
|
4,819,365 |
| All-in
sustaining cash cost per ounce of payable silver equivalent
sold2 |
|
|
20.30 |
|
|
20.71 |
|
|
17.97 |
|
|
18.94 |
| All-in
cash cost per ounce of payable silver equivalent sold2 |
|
|
20.30 |
|
|
20.71 |
|
|
17.97 |
|
|
18.94 |
| 1 Silver
equivalent sold for Q4 2022 is calculated using a silver to gold
ratio of 0.0:1 (Q4 2021: 76.9:1), silver to lead ratio of 1:22.3
pounds (Q4 2021: 1:22.2), and silver to zinc ratio of 1:15.7 pounds
(Q4 2021: 1:15.4). Silver equivalent sold for 2022 is calculated
using a silver to gold ratio of 85.5:1 (2021: 70.9:1), silver to
lead ratio of 1:22.2 pounds (2021: 1:25.3), and silver to zinc
ratio of 1:13.9 pounds (2021: 1:18.6). |
| 2 Silver
equivalent is calculated using the realized prices for gold,
silver, lead, and zinc. Refer to Financial Results - Sales and
Realized Prices |
| 3 Presented on a
cash basis |
| 4 2021 restated,
Sustaining leases moved from Cash Cost |
Additional information regarding the Company’s
financial results and activities underway are available in the
Company’s audited consolidated financial statements for the year
ended December 31, 2022 and accompanying 2022 MD&A, which are
available for download on the Company’s website,
www.fortunasilver.com, on SEDAR at www.sedar.com and on EDGAR
at www.sec.gov/edgar.
Conference Call and Webcast
A conference call to discuss the financial and
operational results will be held on Thursday, March 16, 2023 at
9:00 a.m. Pacific time | 12:00 p.m. Eastern time. Hosting the call
will be Jorge A. Ganoza, President and CEO; Luis D. Ganoza, Chief
Financial Officer; Cesar Velasco, Chief Operating Officer - Latin
America; David Whittle, Chief Operating Officer - West Africa; and
Paul Weedon, Senior Vice President Exploration.
Shareholders, analysts, media and interested
investors are invited to listen to the live conference call by
logging onto the webcast at
https://www.webcaster4.com/Webcast/Page/1696/47748 or over the
phone by dialing in just prior to the starting time.
Conference call details:
Date: Thursday, March 16, 2023Time: 9:00 a.m.
Pacific time | 12:00 p.m. Eastern time
Dial in number (Toll Free): +1. 888.506.0062Dial
in number (International): +1.973.528.0011Entry code: 839621
Replay number (Toll Free): +1.877.481.4010Replay
number (International): +1.919.882.2331Replay Passcode: 47748
Playback of the earnings call will be available
until Thursday, March 30, 2023. Playback of the webcast will be
available until Saturday, March 9, 2024. In addition, a transcript
of the call will be archived on the Company’s website.
About Fortuna Silver Mines
Inc.
Fortuna Silver Mines Inc. is a Canadian precious
metals mining company with four operating mines in Argentina,
Burkina Faso, Mexico, and Peru, and a fifth mine under construction
in Côte d’Ivoire. Sustainability is integral to all our operations
and relationships. We produce gold and silver and generate shared
value over the long-term for our stakeholders through efficient
production, environmental protection, and social responsibility.
For more information, please visit our website.
ON BEHALF OF THE BOARD
Jorge A. GanozaPresident, CEO,
and DirectorFortuna Silver Mines Inc.
Investor Relations:
Carlos Baca | info@fortunasilver.com |
www.fortunasilver.com | Twitter |
LinkedIn | YouTube
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 anticipated financial and operational performance in
2023; estimated production and costs of production for 2023,
including grade and volume of metal produced and sales, revenues
and cashflows, and capital costs (sustaining and non-sustaining),
and operating costs, including projected production cash costs and
all-in sustaining costs; the ability of the Company to mitigate the
inflationary pressures on supplies used in its operations;
estimated capital expenditures and estimated exploration spending
in 2023, including amounts for exploration activities at its
properties; the Company’s plans for the transition from
construction to operations of a mine at the Séguéla project in Cote
d’Ivoire; the economics for the construction of the mine at the
Séguéla project, including the estimated construction capital
expenditures for the project, the timelines and schedules for the
construction and production of gold at the Séguéla project;
statements regarding the Company's liquidity, access to capital;
the impact of high inflation on the costs of production and the
supply chain; the impact of COVID-19 on the Company’s operations;
the Company's business strategy, plans and outlook; the merit of
the Company's mines and mineral properties; mineral resource and
reserve estimates, metal recovery rates, concentrate grade and
quality; changes in tax rates and tax laws, requirements for
permits, anticipated approvals and other matters. Often, but not
always, these Forward-looking Statements can be identified by the
use of words such as "estimated", “expected”, “anticipated”,
"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; the risks relating to a
global pandemic, including the COVID-19 pandemic, as well as risks
associated with war or other geo-political hostilities, such as the
Ukrainian – Russian conflict, any of which could continue to cause
a disruption in global economic activity; fluctuation in currencies
and foreign exchange rates; increases in the rate of inflation; the
imposition or any extension of capital controls in countries in
which the Company operates; any changes in tax laws in Argentina
and the other countries in which we operate; changes in the prices
of key supplies; 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; changes to
current estimates of mineral reserves and resources; changes to
production and cost estimates; the ability of Minera Cuzcatlan to
successfully contest and revoke the resolution of SEMARNAT which
revoked the environmental impact authorization at the San Jose
mine; changes in the position of regulatory authorities with
respect to the granting of approvals or permits; governmental and
other approvals; changes in government, 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 the accuracy of the
Company’s current mineral resource and reserve estimates; that the
Company’s activities will be conducted in accordance with the
Company’s public statements and stated goals; that there will be no
material adverse change affecting the Company, its properties or
changes to production estimates (which assume accuracy of projected
ore grade, mining rates, recovery timing, and recovery rate
estimates and may be impacted by unscheduled maintenance, labour
and contractor availability and other operating or technical
difficulties); the construction at the Séguéla gold Project will
continue on the time line and in accordance with the budget as
planned; the duration and impacts of COVID-19; geo-political
uncertainties that may affect the Company’s production, workforce,
business, operations and financial condition; the expected trends
in mineral prices and currency exchange rates; that the Company
will be successful in mitigating the impact of inflation on its
business and operations; that Minera Cuzcatlan will be successful
in the legal proceedings to reinstate the environmental impact
authorization at the San Jose mine; that all required approvals and
permits will be obtained for the Company’s business and operations
on acceptable terms; that there will be no significant disruptions
affecting the Company's operations, the ability to meet current and
future obligations 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 these 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.
Cautionary Note to United States Investors
Concerning Estimates of Reserves and Resources
Reserve and resource estimates included in this
news release have been prepared in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI
43-101") and the Canadian Institute of Mining, Metallurgy, and
Petroleum Definition Standards on Mineral Resources and Mineral
Reserves. NI 43-101 is a rule developed by the Canadian Securities
Administrators that establishes standards for public disclosure by
a Canadian company of scientific and technical information
concerning mineral projects. Unless otherwise indicated, all
mineral reserve and mineral resource estimates contained in the
technical disclosure have been prepared in accordance with NI
43-101 and the Canadian Institute of Mining, Metallurgy and
Petroleum Definition Standards on Mineral Resources and Reserves.
Canadian standards, including NI 43-101, differ significantly from
the requirements of the Securities and Exchange Commission, and
mineral reserve and resource information included in this news
release may not be comparable to similar information disclosed by
U.S. companies.
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