UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November, 2024
Commission File No. 0001-34184
SILVERCORP METALS INC.
(Translation of registrant’s name into English)
Suite 1750 - 1066 West Hastings Street
Vancouver, BC Canada V6E 3X1
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F
Form 20-F [ ] Form 40-F [ X ]
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
Dated: November 8, 2024 |
SILVERCORP METALS INC. |
|
/s/ Jonathan Hoyles |
|
Jonathan Hoyles |
|
General Counsel and Corporate Secretary |
2
EXHIBIT INDEX
|
|
EXHIBIT |
DESCRIPTION OF EXHIBIT |
3
Exhibit 99.1
SILVERCORP
METALS INC.
UNAUDITED
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
For
the three and six months ended September 30, 2024 and 2023
(Tabular
amounts are in thousands of US dollars, unless otherwise stated)
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Income |
(Unaudited
- Expressed in thousands of U.S. dollars, except per share amount and number of shares)
| |
| |
Three
Months Ended September 30, | | |
Six
months Ended September 30, | |
| |
Notes | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Revenue | |
4 | |
$ | 68,003 | | |
$ | 53,992 | | |
$ | 140,168 | | |
$ | 113,998 | |
Cost
of mine operations | |
| |
| | | |
| | | |
| | | |
| | |
Production
costs | |
| |
| 23,337 | | |
| 21,268 | | |
| 46,805 | | |
| 45,566 | |
Depreciation
and amortization | |
| |
| 6,887 | | |
| 6,515 | | |
| 14,167 | | |
| 14,178 | |
Mineral
resource taxes | |
| |
| 1,547 | | |
| 1,597 | | |
| 3,195 | | |
| 2,963 | |
Government
fees and other taxes | |
5 | |
| 715 | | |
| 751 | | |
| 1,350 | | |
| 1,408 | |
General
and administrative | |
6 | |
| 3,856 | | |
| 2,918 | | |
| 6,476 | | |
| 5,639 | |
| |
| |
| 36,342 | | |
| 33,049 | | |
| 71,993 | | |
| 69,754 | |
Income
from mine operations | |
| |
| 31,661 | | |
| 20,943 | | |
| 68,175 | | |
| 44,244 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Corporate
general and administrative | |
6 | |
| 4,976 | | |
| 3,810 | | |
| 9,263 | | |
| 7,460 | |
Property
evaluation and business development | |
| |
| 1,257 | | |
| 114 | | |
| 2,679 | | |
| 223 | |
Foreign
exchange loss (gain) | |
| |
| 1,120 | | |
| (1,314 | ) | |
| (629 | ) | |
| 913 | |
(Gain)
loss on investments | |
10 | |
| (3,840 | ) | |
| 603 | | |
| (6,056 | ) | |
| (483 | ) |
Share
of loss in associates | |
11 | |
| 472 | | |
| 705 | | |
| 884 | | |
| 1,345 | |
Dilution
gain on investment in associate | |
11 | |
| — | | |
| (733 | ) | |
| — | | |
| (733 | ) |
Loss
on disposal of plant and equipment | |
| |
| 35 | | |
| 35 | | |
| 147 | | |
| 30 | |
Other
expense | |
| |
| 24 | | |
| 763 | | |
| 409 | | |
| 529 | |
Income
from operations | |
| |
| 27,617 | | |
| 16,960 | | |
| 61,478 | | |
| 34,960 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Finance
income | |
7 | |
| 1,934 | | |
| 1,742 | | |
| 3,614 | | |
| 3,236 | |
Finance
costs | |
7 | |
| (82 | ) | |
| (54 | ) | |
| (147 | ) | |
| (114 | ) |
| |
| |
| 29,469 | | |
| 18,648 | | |
| 64,945 | | |
| 38,082 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Income
tax expense | |
8 | |
| 6,415 | | |
| 3,878 | | |
| 13,762 | | |
| 10,099 | |
Net
income | |
| |
$ | 23,054 | | |
$ | 14,770 | | |
$ | 51,183 | | |
$ | 27,983 | |
Attributable
to: | |
| |
| | | |
| | | |
| | | |
| | |
Equity
holders of the Company | |
| |
$ | 17,707 | | |
$ | 11,050 | | |
$ | 39,645 | | |
$ | 20,267 | |
Non-controlling
interests | |
20 | |
| 5,347 | | |
| 3,720 | | |
| 11,538 | | |
| 7,716 | |
| |
| |
$ | 23,054 | | |
$ | 14,770 | | |
$ | 51,183 | | |
$ | 27,983 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Earnings
per share attributable to the equity holders of the Company | |
| |
| | | |
| | | |
| | | |
| | |
Basic
earnings per share | |
| |
$ | 0.09 | | |
$ | 0.06 | | |
$ | 0.21 | | |
$ | 0.11 | |
Diluted
earnings per share | |
| |
$ | 0.09 | | |
$ | 0.06 | | |
$ | 0.20 | | |
$ | 0.11 | |
Weighted
Average Number of Shares Outstanding - Basic | |
| |
| 203,532,135 | | |
| 176,844,107 | | |
| 190,625,815 | | |
| 176,885,599 | |
Weighted
Average Number of Shares Outstanding - Diluted | |
| |
| 206,474,605 | | |
| 179,750,876 | | |
| 193,546,078 | | |
| 179,792,368 | |
Approved on behalf
of the Board: |
|
|
|
|
|
|
|
(Signed)
Ken Robertson |
|
(Signed)
Rui Feng |
|
Director |
|
Director |
|
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Comprehensive Income (loss) |
(Unaudited
- Expressed in thousands of U.S. dollars)
| |
| |
Three
Months Ended September 30, | | |
Six
Months Ended September 30, | |
| |
Notes | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
| |
| | |
| | |
| | |
| |
Net
income | |
| |
$ | 23,054 | | |
$ | 14,770 | | |
$ | 51,183 | | |
$ | 27,983 | |
Other
comprehensive income (loss), net of taxes: | |
| |
| | | |
| | | |
| | | |
| | |
Items
that may subsequently be reclassified to net income or loss: | |
| |
| | | |
| | | |
| | | |
| | |
Currency
translation adjustment | |
| |
| 18,026 | | |
| (5,969 | ) | |
| 13,798 | | |
| (24,386 | ) |
Share
of other comprehensive income (loss) in associates | |
11 | |
| 169 | | |
| (58 | ) | |
| 24 | | |
| (3 | ) |
Reclassification
to net income upon ownership dilution of investment in associates | |
| |
| — | | |
| (34 | ) | |
| — | | |
| (34 | ) |
Items
that will not subsequently be reclassified to net loss: | |
| |
| | | |
| | | |
| | | |
| | |
Change
in fair value on equity investments designated as FVTOCI | |
10 | |
| (117 | ) | |
| 6 | | |
| (139 | ) | |
| (108 | ) |
Other
comprehensive income (loss), net of taxes | |
| |
$ | 18,078 | | |
$ | (6,055 | ) | |
$ | 13,683 | | |
$ | (24,531 | ) |
Attributable
to: | |
| |
| | | |
| | | |
| | | |
| | |
Equity
holders of the Company | |
| |
$ | 14,684 | | |
$ | (5,571 | ) | |
$ | 10,667 | | |
$ | (20,071 | ) |
Non-controlling
interests | |
20 | |
| 3,394 | | |
| (484 | ) | |
| 3,016 | | |
| (4,460 | ) |
| |
| |
$ | 18,078 | | |
$ | (6,055 | ) | |
$ | 13,683 | | |
$ | (24,531 | ) |
Total
comprehensive income | |
| |
$ | 41,132 | | |
$ | 8,715 | | |
$ | 64,866 | | |
$ | 3,452 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Attributable
to: | |
| |
| | | |
| | | |
| | | |
| | |
Equity
holders of the Company | |
| |
$ | 32,391 | | |
$ | 5,479 | | |
$ | 50,312 | | |
$ | 196 | |
Non-controlling
interests | |
| |
| 8,741 | | |
| 3,236 | | |
| 14,554 | | |
| 3,256 | |
| |
| |
$ | 41,132 | | |
$ | 8,715 | | |
$ | 64,866 | | |
$ | 3,452 | |
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Financial Position |
(Unaudited
- Expressed in thousands of U.S. dollars)
As at | |
Notes | |
September 30, 2024 | | |
March 31, 2024 | |
ASSETS | |
| |
| | | |
| | |
Current Assets | |
| |
| | | |
| | |
Cash and cash equivalents | |
24 | |
$ | 180,325 | | |
$ | 152,942 | |
Short-term investments | |
9 | |
| 29,180 | | |
| 31,949 | |
Trade and other receivables | |
| |
| 1,258 | | |
| 2,202 | |
Inventories | |
| |
| 19,640 | | |
| 7,395 | |
Due from related parties | |
21 | |
| 1,197 | | |
| 590 | |
Income tax receivable | |
| |
| 27 | | |
| 71 | |
Prepaids and deposits | |
| |
| 10,209 | | |
| 6,749 | |
| |
| |
| 241,836 | | |
| 201,898 | |
Non-current Assets | |
| |
| | | |
| | |
Long-term prepaids and deposits | |
| |
| 3,979 | | |
| 1,634 | |
Reclamation deposits | |
| |
| 4,539 | | |
| 4,409 | |
Other investments | |
10 | |
| 12,433 | | |
| 46,254 | |
Investment in associates | |
11 | |
| 48,746 | | |
| 49,426 | |
Investment properties | |
12 | |
| 455 | | |
| 463 | |
Plant and equipment | |
4, 13 | |
| 93,031 | | |
| 79,898 | |
Mineral rights and properties | |
4, 14 | |
| 575,716 | | |
| 318,833 | |
Long-term receivables | |
| |
| 784 | | |
| — | |
TOTAL ASSETS | |
| |
$ | 981,519 | | |
$ | 702,815 | |
LIABILITIES AND EQUITY | |
| |
| | | |
| | |
Current Liabilities | |
| |
| | | |
| | |
Accounts payable and accrued liabilities | |
| |
$ | 73,435 | | |
$ | 41,797 | |
Current portion of lease obligation | |
16 | |
| 231 | | |
| 213 | |
Deposits received | |
| |
| 4,446 | | |
| 4,223 | |
Income tax payable | |
| |
| 1,412 | | |
| 921 | |
| |
| |
| 79,524 | | |
| 47,154 | |
Non-current Liabilities | |
| |
| | | |
| | |
Long-term portion of lease obligation | |
16 | |
| 1,019 | | |
| 1,102 | |
Long-term deposits received | |
15 | |
| 13,250 | | |
| — | |
Deferred income tax liabilities | |
| |
| 55,926 | | |
| 51,108 | |
Environmental rehabilitation | |
17 | |
| 6,241 | | |
| 6,442 | |
Total Liabilities | |
| |
| 155,960 | | |
| 105,806 | |
Equity | |
| |
| | | |
| | |
Share capital | |
| |
| 408,125 | | |
| 258,400 | |
Equity reserves | |
| |
| 2,180 | | |
| (12,908 | ) |
Retained earnings | |
| |
| 293,584 | | |
| 261,763 | |
Total equity attributable to the equity holders of the Company | |
| |
| 703,889 | | |
| 507,255 | |
| |
| |
| | | |
| | |
Non-controlling interests | |
4, 20 | |
| 121,670 | | |
| 89,754 | |
Total Equity | |
| |
| 825,559 | | |
| 597,009 | |
| |
| |
| | | |
| | |
TOTAL LIABILITIES AND EQUITY | |
| |
$ | 981,519 | | |
$ | 702,815 | |
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Cash Flows |
(Unaudited
- Expressed in thousands of U.S. dollars)
| |
| |
Three Months Ended September 30, | | |
Six Months Ended September 30, | |
| |
Notes | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Cash provided by | |
| |
| | | |
| | | |
| | | |
| | |
Operating activities | |
| |
| | | |
| | | |
| | | |
| | |
Net income | |
| |
$ | 23,054 | | |
$ | 14,770 | | |
$ | 51,183 | | |
$ | 27,983 | |
Add (deduct) items not affecting cash: | |
| |
| | | |
| | | |
| | | |
| | |
Finance costs | |
7 | |
| 82 | | |
| 54 | | |
| 147 | | |
| 114 | |
Income tax expense | |
8 | |
| 6,415 | | |
| 3,878 | | |
| 13,762 | | |
| 10,099 | |
Depreciation, amortization and depletion | |
| |
| 7,325 | | |
| 6,927 | | |
| 15,061 | | |
| 15,015 | |
(Gain) loss on investments | |
10 | |
| (3,840 | ) | |
| 603 | | |
| (6,056 | ) | |
| (483 | ) |
Share of loss in associates | |
11 | |
| 472 | | |
| 705 | | |
| 884 | | |
| 1,345 | |
Dilution gain on investment in associate | |
| |
| — | | |
| (733 | ) | |
| — | | |
| (733 | ) |
Loss on disposal of plant and equipment | |
| |
| 35 | | |
| 35 | | |
| 147 | | |
| 30 | |
Share-based compensation | |
18 | |
| 1,182 | | |
| 1,366 | | |
| 2,383 | | |
| 2,737 | |
Reclamation expenditures | |
17 | |
| (287 | ) | |
| (214 | ) | |
| (475 | ) | |
| (261 | ) |
Income taxes paid | |
| |
| (6,768 | ) | |
| (1,784 | ) | |
| (9,904 | ) | |
| (6,317 | ) |
Interest paid | |
7 | |
| (29 | ) | |
| (6 | ) | |
| (59 | ) | |
| (13 | ) |
Changes in non-cash operating working capital | |
24 | |
| (4,513 | ) | |
| 3,243 | | |
| (3,990 | ) | |
| 8,209 | |
Net cash provided by operating activities | |
| |
| 23,128 | | |
| 28,844 | | |
| 63,083 | | |
| 57,725 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Investing activities | |
| |
| | | |
| | | |
| | | |
| | |
Plant and equipment | |
| |
| | | |
| | | |
| | | |
| | |
Additions | |
| |
| (5,581 | ) | |
| (3,343 | ) | |
| (9,372 | ) | |
| (6,557 | ) |
Proceeds on disposals | |
| |
| 40 | | |
| 348 | | |
| 40 | | |
| 472 | |
Mineral rights and properties | |
| |
| | | |
| | | |
| | | |
| | |
Acquisition | |
3, 24 | |
| (4,953 | ) | |
| — | | |
| (4,953 | ) | |
| — | |
Capital expenditures | |
| |
| (16,985 | ) | |
| (12,086 | ) | |
| (29,579 | ) | |
| (23,971 | ) |
Reclamation deposits | |
| |
| | | |
| | | |
| | | |
| | |
Paid | |
| |
| (23 | ) | |
| (14 | ) | |
| (39 | ) | |
| (29 | ) |
Refund | |
| |
| 19 | | |
| 33 | | |
| 44 | | |
| 33 | |
Other investments | |
| |
| | | |
| | | |
| | | |
| | |
Acquisition | |
10 | |
| (1,011 | ) | |
| (18,465 | ) | |
| (19,784 | ) | |
| (22,059 | ) |
Proceeds on disposals | |
10 | |
| 95 | | |
| 770 | | |
| 34,202 | | |
| 840 | |
Investment in associates | |
11 | |
| — | | |
| (4,982 | ) | |
| (4 | ) | |
| (4,982 | ) |
Short-term investment | |
| |
| | | |
| | | |
| | | |
| | |
Purchase | |
| |
| (22,156 | ) | |
| (20,912 | ) | |
| (95,087 | ) | |
| (29,464 | ) |
Redemption | |
| |
| 65,399 | | |
| 7,587 | | |
| 98,667 | | |
| 13,537 | |
Net cash used in investing activities | |
| |
| 14,844 | | |
| (51,064 | ) | |
| (25,865 | ) | |
| (72,180 | ) |
| |
| |
| | | |
| | | |
| | | |
| | |
Financing activities | |
| |
| | | |
| | | |
| | | |
| | |
Principal payments on lease obligation | |
16 | |
| (45 | ) | |
| (65 | ) | |
| (85 | ) | |
| (129 | ) |
Cash dividends distributed | |
18(c) | |
| — | | |
| — | | |
| (2,221 | ) | |
| (2,214 | ) |
Non-controlling interests | |
| |
| | | |
| | | |
| | | |
| | |
Distribution | |
4, 20 | |
| (7,316 | ) | |
| — | | |
| (11,049 | ) | |
| (7,248 | ) |
Related parties | |
| |
| | | |
| | | |
| | | |
| | |
Payments made | |
21 | |
| — | | |
| — | | |
| (500 | ) | |
| — | |
Proceeds from issuance of common shares | |
| |
| 1,120 | | |
| — | | |
| 1,246 | | |
| — | |
Common shares repurchased as part of normal course issuer bid | |
| |
| — | | |
| (572 | ) | |
| — | | |
| (572 | ) |
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Cash Flows |
(Unaudited
- Expressed in thousands of U.S. dollars)
Net cash used in financing activities | |
| |
| (6,241 | ) | |
| (637 | ) | |
| (12,609 | ) | |
| (10,163 | ) |
| |
| |
| | | |
| | | |
| | | |
| | |
Effect of exchange rate changes on cash and cash equivalents | |
| |
| 4,180 | | |
| (1,323 | ) | |
| 2,774 | | |
| (1,976 | ) |
| |
| |
| | | |
| | | |
| | | |
| | |
Decrease in cash and cash equivalents | |
| |
| 35,911 | | |
| (24,180 | ) | |
| 27,383 | | |
| (26,594 | ) |
| |
| |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents, beginning of the period | |
| |
| 144,414 | | |
| 143,278 | | |
| 152,942 | | |
| 145,692 | |
| |
| |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents, end of the period | |
| |
$ | 180,325 | | |
$ | 119,098 | | |
$ | 180,325 | | |
$ | 119,098 | |
Supplementary cash flow information | |
24 | |
| | | |
| | | |
| | | |
| | |
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Changes in Equity |
(Unaudited - Expressed in thousands
of U.S. dollars, except numbers for share figures)
| |
| |
Share capital | | |
Equity reserves | | |
| | |
| | |
| | |
| |
| |
Notes | |
Number of
shares | | |
Amount | | |
Share option reserve | | |
Reserves | | |
Accumulated
other
comprehensive
loss | | |
Retained
earnings | | |
Total equity
attributable to the
equity holders of
the Company | | |
Non-controlling interests | | |
Total equity | |
Balance, April 1, 2023 | |
| |
| 176,771,265 | | |
$ | 255,684 | | |
$ | 20,893 | | |
$ | 25,834 | | |
$ | (43,243 | ) | |
$ | 229,885 | | |
$ | 489,053 | | |
$ | 90,778 | | |
$ | 579,831 | |
Restricted share units vested | |
| |
| 245,278 | | |
| 1,001 | | |
| (1,001 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Share-based compensation | |
| |
| — | | |
| — | | |
| 2,737 | | |
| — | | |
| — | | |
| — | | |
| 2,737 | | |
| — | | |
| 2,737 | |
Dividends declared | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (2,214 | ) | |
| (2,214 | ) | |
| — | | |
| (2,214 | ) |
Distribution to non-controlling interests | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (7,248 | ) | |
| (7,248 | ) |
Shares buy-back as per normal course issuer bid | |
| |
| (196,554 | ) | |
| (572 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| (572 | ) | |
| — | | |
| (572 | ) |
Comprehensive income (loss) | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| (20,071 | ) | |
| 20,267 | | |
| 196 | | |
| 3,256 | | |
| 3,452 | |
Balance, September 30, 2023 | |
| |
| 176,819,989 | | |
$ | 256,113 | | |
$ | 22,629 | | |
$ | 25,834 | | |
$ | (63,314 | ) | |
$ | 247,938 | | |
$ | 489,200 | | |
$ | 86,786 | | |
$ | 575,986 | |
Restricted share units vested | |
| |
| 683,477 | | |
| 2,735 | | |
| (2,735 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Share-based compensation | |
| |
| — | | |
| — | | |
| 1,409 | | |
| — | | |
| — | | |
| — | | |
| 1,409 | | |
| — | | |
| 1,409 | |
Dividends declared | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (2,214 | ) | |
| (2,214 | ) | |
| — | | |
| (2,214 | ) |
Shares buy-back as per normal course issuer bid | |
| |
| (191,770 | ) | |
| (448 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| (448 | ) | |
| — | | |
| (448 | ) |
Distribution to non-controlling interests | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (3,840 | ) | |
| (3,840 | ) |
Comprehensive income | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| 3,269 | | |
| 16,039 | | |
| 19,308 | | |
| 6,808 | | |
| 26,116 | |
Balance, March 31, 2024 | |
| |
| 177,311,696 | | |
$ | 258,400 | | |
$ | 21,303 | | |
$ | 25,834 | | |
$ | (60,045 | ) | |
$ | 261,763 | | |
$ | 507,255 | | |
$ | 89,754 | | |
$ | 597,009 | |
Options exercised | |
| |
| 450,131 | | |
| 2,088 | | |
| (842 | ) | |
| — | | |
| — | | |
| — | | |
| 1,246 | | |
| — | | |
| 1,246 | |
Restricted share units vested | |
| |
| 345,329 | | |
| 1,621 | | |
| (1,621 | ) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Securities issued upon acquisition of Adventus | |
| |
| 38,818,841 | | |
| 146,016 | | |
| 4,501 | | |
| — | | |
| — | | |
| — | | |
| 150,517 | | |
| 22,808 | | |
| 173,325 | |
Share-based compensation | |
18(b) | |
| — | | |
| — | | |
| 2,383 | | |
| — | | |
| — | | |
| — | | |
| 2,383 | | |
| — | | |
| 2,383 | |
Dividends declared | |
18(c) | |
| — | | |
| — | | |
| | | |
| — | | |
| — | | |
| (2,221 | ) | |
| (2,221 | ) | |
| — | | |
| (2,221 | ) |
Adjustment to non-controlling interests | |
20 | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (5,603 | ) | |
| (5,603 | ) | |
| 5,603 | | |
| — | |
Distribution to non-controlling interests | |
20 | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (11,049 | ) | |
| (11,049 | ) |
Comprehensive income | |
| |
| — | | |
| — | | |
| — | | |
| — | | |
| 10,667 | | |
| 39,645 | | |
| 50,312 | | |
| 14,554 | | |
| 64,866 | |
Balance, September 30, 2024 | |
| |
| 216,925,997 | | |
$ | 408,125 | | |
$ | 25,724 | | |
$ | 25,834 | | |
$ | (49,378 | ) | |
$ | 293,584 | | |
$ | 703,889 | | |
$ | 121,670 | | |
$ | 825,559 | |
See
accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Condensed
Consolidated Interim Statements of Changes in Equity |
(Unaudited - Expressed in thousands
of U.S. dollars, except numbers for share figures)
See accompanying notes to the consolidated financial statements
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Silvercorp
Metals Inc., along with its subsidiary companies (collectively the “Company”), is engaged in the acquisition, exploration,
development, and mining of mineral properties. The Company’s producing mines are located in China, and current exploration and
development projects are located in China and Ecuador.
On
July 31, 2024, the Company acquired a 75% interest in the El Domo project, a permitted, pre-construction stage copper-gold project (the
“El Domo Project”), and a 98.7% interest in the Condor project, a development stage gold project (the “Condor Project”),
through the acquisition of Adventus Mining Corporation (“Adventus”), a Canadian company focused on the exploration and development
of its mineral properties in Ecuador. The acquisition is expected to contribute to the Company’s diversification of its mining assets
and enhance its geographical market presence in Latin America (note 3).
The
Company is a publicly listed company incorporated in the Province of British Columbia, Canada, with limited liability under the legislation
of the Province of British Columbia. The Company’s shares are traded on the Toronto Stock Exchange and NYSE American.
The
head office, registered address and records office of the Company are located at 1066 West Hastings Street, Suite 1750, Vancouver, British
Columbia, Canada, V6E 3X1.
| 2. | MATERIAL
ACCOUNTING POLICIES |
(a) Statement of Compliance
These
unaudited condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard
34 – Interim Financial Reporting (“IAS 34”) of the International Financial Reporting Standards (“IFRS”)
as issued by the International Accounting Standards Board (“IASB”) and have been condensed with certain disclosures from
the Company’s audited consolidated financial statements for the year ended March 31, 2024. Accordingly, these unaudited condensed
consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements
for the year ended March 31, 2024. These unaudited condensed consolidated interim financial statements follow the same accounting policies
set out in note 2 to the audited consolidated financial statements for the year ended March 31, 2024 with the exception of the adoption
of certain amendments noted in note 2(b) below.
These
unaudited condensed consolidated interim financial statements were authorized for issue in accordance with a resolution of the Board
of Directors dated November 6, 2024.
(b) Adoption of New Accounting Standards, Interpretation or Amendments
The
Company adopted the following new standards or amendments to IFRS as at April 1, 2024. Their adoption has not had any material impact
on the disclosures or the amounts reported in these unaudited condensed consolidated interim financial statements.
Classification
of Liabilities as Current or Non-Current (Amendments to IAS 1)
The
amendments to IAS 1 clarify the presentation of liabilities. The classification of liabilities as current or non-current is based on
contractual rights that are in existence at the end of the reporting period and is affected by expectations about whether an entity will
exercise its right to defer settlement. A liability not due over the next twelve months is classified as non-current even if management
intends or expects to settle the liability within twelve months. The amendment also introduces a definition of ’settlement’
to make clear that settlement refers to the transfer of cash, equity instruments,
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
other assets, or services to the counterparty. The
amendment issued in October 2022 also clarifies how conditions with which an entity must comply within twelve months after the reporting
period affect the classification of a liability. Covenants to be complied with after the reporting date do not affect the classification
of debt as current or non-current at the reporting date. The amendments were applied effective April 1, 2024 and did not have a material
impact on the Company’s unaudited condensed consolidated interim financial statements.
Lease
Liability in a Sale and Leaseback (Amendments to IFRS 16)
The
amendments require a seller-lessee to subsequently measure lease liabilities arising from a leaseback in a way that it does not recognize
any amount of the gain or loss that relates to the right of use it retains. The new requirements do not prevent a seller-lessee from
recognizing in profit or loss any gain or loss relating to the partial or full termination of a lease. A seller-lessee applies the amendments
retrospectively in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors to sale and leaseback transactions
entered into after the date of initial application. The amendments were applied effective April 1, 2024 and did not have a material impact
on the Company’s unaudited condensed consolidated interim financial statements.
Supplier
Financing Arrangements (Amendments to IAS 7 and IFRS 7)
The
amendments require disclosure requirements regarding the effects of supplier finance arrangement on their liabilities, cash flows and
exposure to liquidity risk. Entities are required to disclose the followings:
| ● | The
terms and conditions; |
| ● | The
amount of the liabilities that are part of the arrangements, breaking out the amounts for
which the suppliers have already received payment from the finance providers, and stating
where the liabilities are reflected in the balance sheet; |
| ● | Ranges
of payment due dates; and |
| ● | Liquidity
risk information. |
The
amendments were applied effective April 1, 2024 and did not have a material impact on the Company’s unaudited condensed consolidated
interim financial statements.
(c) New Accounting Standards Issued but not effective
Certain
new accounting standards and interpretations have been issued that are not mandatory for the current period and have not been early adopted.
Presentation
and Disclosure in Financial Statements (IFRS 18 replaces IAS 1)
In
April 2024, the IASB released IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18 replaces IAS 1 Presentation
of Financial Statements while carrying forward many of the requirements in IAS 1. IFRS 18 introduces new requirements to: i) present
specified categories and defined subtotals in the statement of earnings, ii) provide disclosures on management-defined performance measures
(“MPMs”) in the notes to the financial statements, iii) improve aggregation and disaggregation. Some of the requirements
in IAS 1 are moved to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and IFRS 7 Financial Instruments: Disclosures.
The IASB also made minor amendments to
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
IAS 7 Statement of Cash Flows and IAS 33 Earnings per Share in connection with the new standard.
IFRS 18 requires retrospective application with specific transition provisions.
The
amendments are effective for annual reporting periods beginning on or after January 1, 2027, with early adoption permitted. The Company
is currently evaluating the impact of IFRS 18 on its financial statements.
Lack
of Exchangeability (Amendments to IAS 21)
The
amendments contain guidance to specify when a currency is exchangeable and how to determine the exchange rate when it is not. The amendments
are effective for annual reporting periods beginning on or after January 1, 2025. The Company is currently evaluating the impact of this
amendment.
Amendments
to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)
The
amendments contain guidance to derecognition of a financial liability settled through electronic transfer, as well as classification
of financial assets for:
| ● | Contractual
terms that are consistent with a basic lending arrangement; |
| ● | Assets
with non-recourse features; |
| ● | Contractually
linked instruments. |
Also,
additional disclosures relating to investments in equity instruments designated at fair value through other comprehensive income (“FVOCI”)
and added disclosure requirements for financial instruments with contingent features. The amendments are effective for annual reporting
periods beginning on or after January 1, 2026. The Company is currently evaluating the impact of these amendments.
(d) Basis of Consolidation
These
unaudited condensed consolidated interim financial statements include the accounts of the Company and its wholly or partially owned subsidiaries.
Subsidiaries
are consolidated from the date on which the Company obtains control up to the date of the disposition of control. Control is achieved
when the Company has power over the subsidiary, is exposed or has rights to variable returns from its involvement with the subsidiary
and has the ability to use its power to affect its returns. These unaudited condensed consolidated interim financial statements include
the financial results of Adventus after its acquisition on July 31, 2024.
For
non-wholly owned subsidiaries over which the Company has control, the net assets attributable to outside equity shareholders are presented
as “non-controlling interests” in the equity section of the consolidated balance sheets. Net income for the period that is
attributable to the non-controlling interests is calculated based on the ownership of the non-controlling interest shareholders in the
subsidiary. Adjustments to recognize the non-controlling interests’ share of changes to the subsidiary’s equity are made
even if this results in the non-controlling interests having a deficit balance. Changes in the Company’s ownership interest in
a subsidiary that do not result in a loss of control are recorded as equity transactions. The carrying amount of non-controlling interests
is adjusted to reflect the change in the non-controlling interests’ relative interests in the subsidiary and the difference between
the adjustment to the carrying amount of non-controlling interest and the Company’s share of proceeds received and/or consideration
paid is recognized directly in equity and attributed to equity holders of the Company.
Balances,
transactions, revenues and expenses between the Company and its subsidiaries are eliminated on consolidation.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Table
below summarizes the Company’s material subsidiaries which are consolidated as follows:
Name of subsidiaries |
Principal activity |
Place of incorporation |
Ownership interest |
Mineral properties |
Silvercorp Metals (China) Inc. |
Corporate |
China |
100% |
|
Adventus Mining Corporation(ii) |
Holding |
Canada |
100% |
|
Luminex Resources Corp.(ii) |
Holding |
Canada |
100% |
|
Salazar Holdings Limited(ii) |
Holding |
Canada |
75% |
|
Fortune Mining Limited |
Holding |
BVI (i) |
100% |
|
Victor Resources Ltd. |
Holding |
BVI |
100% |
|
Victor Mining Ltd. |
Holding |
BVI |
100% |
|
Yangtze Mining (H.K.) Ltd. |
Holding |
Hong Kong |
100% |
|
Wonder Success Limited |
Holding |
Hong Kong |
100% |
|
Henan Huawei Mining Co. Ltd. (“Henan Huawei”) |
Mining |
China |
80% |
Ying Mining District |
Henan Found Mining Co. Ltd. (“Henan Found”) |
Mining |
China |
77.5% |
Xinshao Yunxiang Mining Co., Ltd. (“Yunxiang”) |
Care and maintenance |
China |
70% |
BYP |
Guangdong Found Mining Co. Ltd. (“Guangdong Found”) |
Mining |
China |
99% |
GC |
Shanxi Xinbaoyuan Mining Co., Ltd. (“Xinbaoyuan”) |
Development and exploration |
China |
77.5% |
Kuanping |
Curimining S.A(ii) |
Development and exploration |
Ecuador |
75% |
El Domo |
Condormine S.A(ii) |
Exploration |
Ecuador |
98.7% |
Condor |
(i) British Virgin Islands (“BVI”)
(ii) Entities added as part of the Adventus acquisition set out in note 3
(e) Business combinations or asset acquisition
It
follows the same policies set out in note 2 to the audited consolidated financial statements for the year ended March 31, 2024.
Previously
held interest
In
a step acquisition that is not accounted for as a business combination, previously held equity interest in an acquiree is remeasured
to fair value at the acquisition date, and a gain or loss is recognized in profit or loss, or other comprehensive income, as appropriate
(depending on whether the previously held equity interest was measured at fair value through profit or loss or fair value through other
comprehensive income).
(f) Critical Accounting Judgments and Estimates
These
unaudited condensed consolidated interim financial statements follow the same significant accounting judgments and estimates set out
in note 2 to the audited consolidated financial statements for the year ended March 31, 2024.
In
addition to the judgments and estimates set out in note 2 to the audited consolidated financial statements for the year ended March 31,
2024, the Company has made critical judgments in assessing whether transactions undertaken during
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
the reporting period represent business
combinations or asset acquisitions in applying IFRS 3 Business Combinations. This distinction affects how assets and liabilities acquired
are accounted for and the resulting financial statement impact.
For
each acquisition, the Company evaluated whether the transaction met the definition of a business under IFRS 3. This involved assessing
if the acquisition included (i) an integrated set of activities and assets, (ii) inputs, and (iii) processes that have the capability
to create outputs. Where an acquired set of activities and assets did not meet the criteria of a business, the transaction was classified
as an asset acquisition, and consideration paid was allocated to the identifiable net assets on a relative fair value basis.
The
following key factors were considered:
| ● | Inputs
and processes acquired: Whether the acquired assets included organized workflows, management
processes, or a workforce capable of managing and producing outputs. |
| ● | Control
over critical processes: An assessment of whether the Group obtained control over processes
that are critical to generating outputs. |
| ● | Synergies
and strategic benefits: The extent to which the transaction provided synergies or additional
strategic capabilities. |
The
application of this judgment has a material effect on the financial statements as it influences whether goodwill, deferred taxes are
recognized and the accounting treatment for transaction costs.
(g) Deferred revenue
When
a cash prepayment is received from customers prior to a sale meeting the criteria of revenue recognition, the amount received is recognized
as deferred revenue on the statements of financial position. Revenue will be subsequently recognized in the consolidated statements of
income when such criteria are met.
Where
the Company determines at the beginning of a precious metals streaming contract that the obligations under it will be satisfied through
the delivery of its own production of non-financial items (i.e. gold and silver credits) instead of cash or other financial assets, the
Company will account for any upfront cash deposit as deposit liability to be reclassified to deferred revenue on completion of the mine.
The
consideration received from deliveries of the gold and silver credits is variable, subject to changes in the total estimated production
as well as the prices of the gold and silver credits at the time of delivery. Changes to the variable consideration are accounted for
in revenue in the consolidated statements of income.
The
deferred revenue contains a significant financing component as the upfront cash deposit is received in advance of the delivery of the
concentrate and a financing charge on the deferred revenue is recognized. The interest rate used is based on the implicit rate for the
streaming contract on the date of inception, based on the discount rate and the reserve and resources assumed. The financing component
attributable to the qualifying asset is capitalized and included as its carrying amounts until the asset is ready for their intended
use, in accordance with the Company’s accounting policy for borrowing costs.
| 3. | ACQUISITION
OF ADVENTUS MINING CORPORATION |
On
July 31, 2024, the Company completed the acquisition of Adventus through the purchase of all issued and outstanding common shares of
Adventus, not already owned by Silvercorp, by issuing a total of 38,818,841 Silvercorp shares to the original shareholders of Adventus.
The Company also issued a total of 1,766,721 Silvercorp stock options to replace Adventus’ outstanding options, and 2,787,020 Silvercorp
warrants to replace Adventus’ outstanding warrants. All
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Adventus restricted share units outstanding immediately before closing
were settled in cash, funded by the Company through Adventus.
Adventus
is a Canadian company focused on the exploration and development of copper-gold mineral projects, mainly the El Domo Project and the
Condor Project, in Ecuador. Adventus owns 75% interest in the El Domo Project and 98.7% interest in the Condor Project.
The
acquisition has been accounted for as an asset acquisition as it was determined that the mineral projects did not constitute a business
as defined by IFRS 3 - Business Combination. The consideration paid along with the transaction costs incurred in connection with the
acquisition of Adventus, were determined in accordance with IFRS 2 - Share-based Payment, and were allocated to the assets acquired and
liabilities assumed based on their relative fair values.
Table
below summarizes the total acquisitions incurred and their allocation to the assets acquired and liabilities assumed.
Consideration Paid | |
| |
38,818,841 common shares of Silvercorp issued | |
$ | 146,016 | |
1,766,721 stock options of Silvercorp issued | |
| 2,403 | |
2,787,020 warrants of Silvercorp issued | |
| 2,098 | |
Previously held interest in Adventus | |
| 25,748 | |
Funds advanced to Adventus before closing | |
| 1,239 | |
| |
$ | 177,504 | |
Transaction costs | |
| 3,838 | |
Total acquisition costs to be allocated | |
$ | 181,342 | |
| |
| | |
Fair value of assets acquired and liabilities assumed | |
| | |
Cash and cash equivalent | |
$ | 3,483 | |
Other receivable | |
| 710 | |
Prepaid and deposits | |
| 324 | |
Other investment | |
| 21 | |
Property, plant and equipment | |
| 523 | |
Mineral rights and properties | |
| 225,958 | |
Other assets | |
| 645 | |
Accounts payable and accrued liabilities | |
| (14,248 | ) |
Lease obligation | |
| (16 | ) |
Deposit received (note 15) | |
| (13,250 | ) |
Non-controlling interests | |
| (22,808 | ) |
Net assets acquired | |
$ | 181,342 | |
All
of the Company’s operations are within the mining and metals industry. The Company reviews its segment reporting to ensure it reflects
the operational structure of the Company after the Adventus acquisition and enables the Company’s chief operating decision maker to review
operating segment performance.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
An
operating segment is defined as a component of the Company that:
| ● | Engages
in business activities from which it may earn revenues or incur expenses; |
| ● | Whose
operating results are reviewed regularly by the entity’s chief operating decision maker;
and |
| ● | For
which discrete financial information is available. |
The
Company has determined that each producing mine and significant development property represents an operating segment. The Company has
organized its reportable and operating segments by significant revenue streams and geographic regions.
As
of September 30, 2024, the Company’s significant operating segments include its two producing properties in China, two development and
exploration projects in Ecuador. “Other” consists primarily of the Company’s corporate assets, other development and exploration
properties, and corporate expenses which are not allocated to operating segments.
(a) Segmented information for operating results is as follows:
Three
months ended September 30, 2024 |
| |
China | | |
Ecuador | | |
| | |
| |
Statements of Income | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Revenue | |
$ | 58,704 | | |
$ | 9,299 | | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | 68,003 | |
Costs of mine operations | |
| (29,577 | ) | |
| (6,327 | ) | |
| (5 | ) | |
| (62 | ) | |
| (371 | ) | |
| (36,342 | ) |
Income (loss) from mine operations | |
| 29,127 | | |
| 2,972 | | |
| (5 | ) | |
| (62 | ) | |
| (371 | ) | |
| 31,661 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| (1,295 | ) | |
| (40 | ) | |
| 53 | | |
| (17 | ) | |
| (2,745 | ) | |
| (4,044 | ) |
Finance items, net | |
| 477 | | |
| 73 | | |
| — | | |
| — | | |
| 1,302 | | |
| 1,852 | |
Income tax expenses | |
| (4,497 | ) | |
| (363 | ) | |
| — | | |
| — | | |
| (1,555 | ) | |
| (6,415 | ) |
Net income (loss) | |
$ | 23,812 | | |
$ | 2,642 | | |
$ | 48 | | |
$ | (79 | ) | |
$ | (3,369 | ) | |
$ | 23,054 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Attributable to: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Equity holders of the Company | |
| 18,481 | | |
| 2,615 | | |
| 39 | | |
| (78 | ) | |
| (3,350 | ) | |
| 17,707 | |
Non-controlling interest | |
| 5,331 | | |
| 27 | | |
| 9 | | |
| (1 | ) | |
| (19 | ) | |
| 5,347 | |
Net income (loss) | |
$ | 23,812 | | |
$ | 2,642 | | |
$ | 48 | | |
$ | (79 | ) | |
$ | (3,369 | ) | |
$ | 23,054 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Three months ended September 30, 2023 |
| |
China | | |
Ecuador | | |
| | |
| |
Statements of Income | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Revenue | |
$ | 49,839 | | |
$ | 4,153 | | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | 53,992 | |
Costs of mine operations | |
| (28,023 | ) | |
| (4,902 | ) | |
| — | | |
| — | | |
| (124 | ) | |
| (33,049 | ) |
Income (loss) from mine operations | |
| 21,816 | | |
| (749 | ) | |
| — | | |
| — | | |
| (124 | ) | |
| 20,943 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| (853 | ) | |
| 38 | | |
| — | | |
| — | | |
| (3,168 | ) | |
| (3,983 | ) |
Finance items, net | |
| 583 | | |
| 126 | | |
| — | | |
| — | | |
| 979 | | |
| 1,688 | |
Income tax (expense)/recovery | |
| (4,015 | ) | |
| 139 | | |
| — | | |
| — | | |
| (2 | ) | |
| (3,878 | ) |
Net income (loss) | |
| 17,531 | | |
| (446 | ) | |
| — | | |
| — | | |
| (2,315 | ) | |
| 14,770 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Attributable to: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Equity holders of the Company | |
| 13,760 | | |
| (441 | ) | |
| — | | |
| — | | |
| (2,269 | ) | |
| 11,050 | |
Non-controlling interest | |
| 3,771 | | |
| (5 | ) | |
| — | | |
| — | | |
| (46 | ) | |
| 3,720 | |
Net income (loss) | |
$ | 17,531 | | |
$ | (446 | ) | |
$ | — | | |
$ | — | | |
$ | (2,315 | ) | |
$ | 14,770 | |
Six months ended September 30, 2024 |
| |
China | | |
Ecuador | | |
| | |
| |
Statements of Income | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Revenue | |
$ | 121,487 | | |
$ | 18,681 | | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | 140,168 | |
Costs of mine operations | |
| (58,772 | ) | |
| (12,682 | ) | |
| (5 | ) | |
| (62 | ) | |
| (472 | ) | |
| (71,993 | ) |
Income (loss) from mine operations | |
| 62,715 | | |
| 5,999 | | |
| (5 | ) | |
| (62 | ) | |
| (472 | ) | |
| 68,175 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| (1,949 | ) | |
| (19 | ) | |
| 53 | | |
| (17 | ) | |
| (4,765 | ) | |
| (6,697 | ) |
Finance items, net | |
| 942 | | |
| 131 | | |
| — | | |
| — | | |
| 2,394 | | |
| 3,467 | |
Income tax expenses | |
| (9,668 | ) | |
| (900 | ) | |
| — | | |
| — | | |
| (3,194 | ) | |
| (13,762 | ) |
Net income (loss) | |
$ | 52,040 | | |
$ | 5,211 | | |
$ | 48 | | |
$ | (79 | ) | |
$ | (6,037 | ) | |
$ | 51,183 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Attributable to: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Equity holders of the Company | |
| 40,499 | | |
| 5,159 | | |
| 39 | | |
| (78 | ) | |
| (5,974 | ) | |
| 39,645 | |
Non-controlling interest | |
| 11,541 | | |
| 52 | | |
| 9 | | |
| (1 | ) | |
| (63 | ) | |
| 11,538 | |
Net income (loss) | |
$ | 52,040 | | |
$ | 5,211 | | |
$ | 48 | | |
$ | (79 | ) | |
$ | (6,037 | ) | |
$ | 51,183 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Six months ended September 30, 2023 |
| |
China | | |
Ecuador | | |
| | |
| |
Statements of Income | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Revenue | |
$ | 100,415 | | |
$ | 13,583 | | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | 113,998 | |
Costs of mine operations | |
| (56,884 | ) | |
| (12,659 | ) | |
| — | | |
| — | | |
| (211 | ) | |
| (69,754 | ) |
Income (loss) from mine operations | |
| 43,531 | | |
| 924 | | |
| — | | |
| — | | |
| (211 | ) | |
| 44,244 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| (707 | ) | |
| 114 | | |
| — | | |
| — | | |
| (8,691 | ) | |
| (9,284 | ) |
Finance items, net | |
| 1,164 | | |
| 260 | | |
| — | | |
| — | | |
| 1,698 | | |
| 3,122 | |
Income tax expenses | |
| (7,773 | ) | |
| 171 | | |
| — | | |
| — | | |
| (2,497 | ) | |
| (10,099 | ) |
Net income (loss) | |
| 36,215 | | |
| 1,469 | | |
| — | | |
| — | | |
| (9,701 | ) | |
| 27,983 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Attributable to: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Equity holders of the Company | |
| 28,398 | | |
| 1,455 | | |
| — | | |
| — | | |
| (9,586 | ) | |
| 20,267 | |
Non-controlling interest | |
| 7,817 | | |
| 14 | | |
| — | | |
| — | | |
| (115 | ) | |
| 7,716 | |
Net income (loss) | |
$ | 36,215 | | |
$ | 1,469 | | |
$ | — | | |
$ | — | | |
$ | (9,701 | ) | |
$ | 27,983 | |
(b) Segmented information for assets and liabilities is as follows:
| |
China | | |
Ecuador | | |
| | |
| |
As at September 30, 2024 | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Current assets | |
$ | 103,391 | | |
$ | 13,818 | | |
$ | 1,737 | | |
$ | 435 | | |
$ | 122,455 | | |
$ | 241,836 | |
Long-term prepaids and deposits | |
| 3,549 | | |
| 333 | | |
| — | | |
| — | | |
| 97 | | |
| 3,979 | |
Reclamation deposits | |
| 1,380 | | |
| 3,152 | | |
| — | | |
| — | | |
| 7 | | |
| 4,539 | |
Other investments | |
| — | | |
| — | | |
| — | | |
| — | | |
| 12,433 | | |
| 12,433 | |
Investment in associates | |
| — | | |
| — | | |
| — | | |
| — | | |
| 48,746 | | |
| 48,746 | |
Investment properties | |
| 455 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 455 | |
Plant and equipment | |
| 74,650 | | |
| 13,337 | | |
| 217 | | |
| 142 | | |
| 4,685 | | |
| 93,031 | |
Mineral rights and properties | |
| 287,954 | | |
| 38,253 | | |
| 203,546 | | |
| 25,514 | | |
| 20,449 | | |
| 575,716 | |
Long-term receivables | |
| — | | |
| — | | |
| 784 | | |
| — | | |
| — | | |
| 784 | |
Total Assets | |
$ | 471,379 | | |
$ | 68,893 | | |
$ | 206,284 | | |
$ | 26,091 | | |
$ | 208,872 | | |
$ | 981,519 | |
Current liabilities | |
| 57,804 | | |
| 6,225 | | |
| 3,745 | | |
| 516 | | |
| 11,234 | | |
| 79,524 | |
Long-term portion of lease obligation | |
| — | | |
| — | | |
| — | | |
| — | | |
| 1,019 | | |
| 1,019 | |
Long-term deposits received | |
| — | | |
| — | | |
| — | | |
| — | | |
| 13,250 | | |
| 13,250 | |
Deferred income tax liabilities | |
| 53,047 | | |
| 1,063 | | |
| — | | |
| — | | |
| 1,816 | | |
| 55,926 | |
Environmental rehabilitation | |
| 3,709 | | |
| 1,519 | | |
| — | | |
| — | | |
| 1,013 | | |
| 6,241 | |
Total liabilities | |
$ | 114,560 | | |
$ | 8,807 | | |
$ | 3,745 | | |
$ | 516 | | |
$ | 28,332 | | |
$ | 155,960 | |
Non-controlling interests | |
$ | 91,605 | | |
$ | (192 | ) | |
$ | 28,816 | | |
$ | (395 | ) | |
$ | 1,836 | | |
$ | 121,670 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
China | | |
Ecuador | | |
| | |
| |
As at March 31, 2024 | |
Ying Mining District | | |
GC Mine | | |
El Domo | | |
Condor | | |
Other | | |
Total | |
Current assets | |
$ | 91,777 | | |
$ | 9,272 | | |
$ | — | | |
$ | — | | |
$ | 100,849 | | |
$ | 201,898 | |
Long-term prepaids and deposits | |
| 1,104 | | |
| 129 | | |
| — | | |
| — | | |
| 401 | | |
| 1,634 | |
Reclamation deposits | |
| 1,370 | | |
| 3,032 | | |
| — | | |
| — | | |
| 7 | | |
| 4,409 | |
Other investments | |
| 63 | | |
| — | | |
| — | | |
| — | | |
| 46,191 | | |
| 46,254 | |
Investment in associates | |
| — | | |
| — | | |
| — | | |
| — | | |
| 49,426 | | |
| 49,426 | |
Investment properties | |
| 463 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 463 | |
Plant and equipment | |
| 61,350 | | |
| 13,648 | | |
| — | | |
| — | | |
| 4,900 | | |
| 79,898 | |
Mineral rights and properties | |
| 264,903 | | |
| 34,409 | | |
| — | | |
| — | | |
| 19,521 | | |
| 318,833 | |
Total Assets | |
$ | 421,030 | | |
$ | 60,490 | | |
$ | — | | |
$ | — | | |
$ | 221,295 | | |
$ | 702,815 | |
Current liabilities | |
| 38,271 | | |
| 5,621 | | |
| — | | |
| — | | |
| 3,262 | | |
| 47,154 | |
Long-term portion of lease obligation | |
| — | | |
| — | | |
| — | | |
| — | | |
| 1,102 | | |
| 1,102 | |
Deferred income tax liabilities | |
| 50,001 | | |
| 133 | | |
| — | | |
| — | | |
| 974 | | |
| 51,108 | |
Environmental rehabilitation | |
| 4,000 | | |
| 1,486 | | |
| — | | |
| — | | |
| 956 | | |
| 6,442 | |
Total liabilities | |
$ | 92,272 | | |
$ | 7,240 | | |
$ | — | | |
$ | — | | |
$ | 6,294 | | |
$ | 105,806 | |
Non-controlling interests | |
$ | 88,166 | | |
$ | (262 | ) | |
$ | — | | |
$ | — | | |
$ | 1,850 | | |
$ | 89,754 | |
(c) Sales by metal
The
sales generated for the three and six months ended September 30, 2024 and 2023 were all earned in China and were comprised of:
| |
Three months ended September 30, 2024 | |
| |
Ying Mining District | | |
GC | | |
Total | |
Gold | |
$ | 2,699 | | |
$ | — | | |
$ | 2,699 | |
Silver | |
| 40,757 | | |
| 2,712 | | |
| 43,469 | |
Lead | |
| 12,028 | | |
| 1,259 | | |
| 13,287 | |
Zinc | |
| 2,081 | | |
| 4,568 | | |
| 6,649 | |
Other | |
| 1,139 | | |
| 760 | | |
| 1,899 | |
| |
$ | 58,704 | | |
$ | 9,299 | | |
$ | 68,003 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
Three months ended September 30, 2023 | |
| |
Ying Mining District | | |
GC | | |
Total | |
Gold | |
$ | 4,565 | | |
$ | — | | |
$ | 4,565 | |
Silver | |
| 29,990 | | |
| 1,163 | | |
| 31,153 | |
Lead | |
| 12,358 | | |
| 769 | | |
| 13,127 | |
Zinc | |
| 1,736 | | |
| 1,879 | | |
| 3,615 | |
Other | |
| 1,190 | | |
| 342 | | |
| 1,532 | |
| |
$ | 49,839 | | |
$ | 4,153 | | |
$ | 53,992 | |
| |
Six months ended September 30, 2024 | |
| |
Ying Mining District | | |
GC | | |
Total | |
Gold | |
$ | 4,685 | | |
$ | — | | |
$ | 4,685 | |
Silver | |
| 83,543 | | |
| 5,724 | | |
| 89,267 | |
Lead | |
| 26,098 | | |
| 2,772 | | |
| 28,870 | |
Zinc | |
| 4,651 | | |
| 8,579 | | |
| 13,230 | |
Other | |
| 2,510 | | |
| 1,606 | | |
| 4,116 | |
| |
$ | 121,487 | | |
$ | 18,681 | | |
$ | 140,168 | |
| |
Six months ended September 30, 2023 | |
| |
Ying Mining District | | |
GC | | |
Total | |
Gold | |
$ | 7,080 | | |
$ | — | | |
$ | 7,080 | |
Silver | |
| 62,351 | | |
| 3,954 | | |
| 66,305 | |
Lead | |
| 25,004 | | |
| 2,718 | | |
| 27,722 | |
Zinc | |
| 3,527 | | |
| 5,747 | | |
| 9,274 | |
Other | |
| 2,453 | | |
| 1,164 | | |
| 3,617 | |
| |
$ | 100,415 | | |
$ | 13,583 | | |
$ | 113,998 | |
(d) Major customers
Revenue
from major customers is summarized as follows:
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
Six months ended September 30, 2024 | |
Customers | |
Ying Mining District | | |
GC | | |
Total | | |
Percentage of
total revenue | |
Customer D | |
$ | 34,644 | | |
$ | — | | |
$ | 34,644 | | |
| 25 | % |
Customer E | |
| 24,972 | | |
| 1,754 | | |
| 26,726 | | |
| 19 | % |
Customer B | |
| 24,446 | | |
| — | | |
| 24,446 | | |
| 17 | % |
Customer A | |
| 19,550 | | |
| 106 | | |
| 19,656 | | |
| 14 | % |
Customer F | |
| 10,030 | | |
| — | | |
| 10,030 | | |
| 7 | % |
| |
$ | 113,642 | | |
$ | 1,860 | | |
$ | 115,502 | | |
| 82 | % |
| |
Six months ended September 30, 2023 | |
Customers | |
Ying Mining District | | |
GC | | |
Total | | |
Percentage of
total revenue | |
Customer A | |
$ | 25,218 | | |
$ | 2,268 | | |
$ | 27,486 | | |
| 24 | % |
Customer B | |
| 24,575 | | |
| — | | |
| 24,575 | | |
| 22 | % |
Customer C | |
| 14,671 | | |
| 1,156 | | |
| 15,827 | | |
| 14 | % |
Customer D | |
| 21,533 | | |
| — | | |
| 21,533 | | |
| 19 | % |
Customer E | |
| 9,056 | | |
| 1,807 | | |
| 10,863 | | |
| 10 | % |
| |
$ | 95,053 | | |
$ | 5,231 | | |
$ | 100,284 | | |
| 89 | % |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| 5. | GOVERNMENT
FEES AND OTHER TAXES |
Government
fees and other taxes consist of:
| |
Three months ended September 30, | | |
Six months ended September 30, | |
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Government fees | |
$ | 16 | | |
$ | 13 | | |
$ | 31 | | |
$ | 29 | |
Other taxes | |
| 699 | | |
| 738 | | |
| 1,319 | | |
| 1,379 | |
| |
$ | 715 | | |
$ | 751 | | |
$ | 1,350 | | |
$ | 1,408 | |
Government
fees include environmental protection fees paid to the state and local Chinese government. Other taxes were composed of surtax on value-added
tax, land usage levy, stamp duty and other miscellaneous levies, duties and taxes imposed by the state and local Chinese government.
| 6. | GENERAL
AND ADMINISTRATIVE |
General
and administrative expenses consist of:
| |
Three months ended September 30, 2024 | | |
Three months ended September 30, 2023 | |
| |
Corporate | | |
Mines | | |
Total | | |
Corporate | | |
Mines | | |
Total | |
Amortization and depreciation | |
$ | 169 | | |
$ | 272 | | |
$ | 441 | | |
$ | 148 | | |
$ | 264 | | |
$ | 412 | |
Office administrative expenses | |
| 650 | | |
| 1,429 | | |
| 2,079 | | |
| 516 | | |
| 840 | | |
| 1,356 | |
Professional fees | |
| 153 | | |
| 156 | | |
| 309 | | |
| 239 | | |
| 124 | | |
| 363 | |
Salaries and benefits | |
| 2,822 | | |
| 1,999 | | |
| 4,821 | | |
| 1,541 | | |
| 1,690 | | |
| 3,231 | |
Share-based compensation | |
| 1,182 | | |
| — | | |
| 1,182 | | |
| 1,366 | | |
| — | | |
| 1,366 | |
| |
$ | 4,976 | | |
$ | 3,856 | | |
$ | 8,832 | | |
$ | 3,810 | | |
$ | 2,918 | | |
$ | 6,728 | |
| |
Six months ended September 30, 2024 | | |
Six months ended September 30, 2023 | |
| |
Corporate | | |
Mines | | |
Total | | |
Corporate | | |
Mines | | |
Total | |
Amortization and depreciation | |
$ | 347 | | |
$ | 550 | | |
$ | 897 | | |
$ | 296 | | |
$ | 541 | | |
$ | 837 | |
Office administrative expenses | |
| 1,315 | | |
| 2,117 | | |
| 3,432 | | |
| 1,057 | | |
| 1,548 | | |
| 2,605 | |
Professional fees | |
| 466 | | |
| 246 | | |
| 712 | | |
| 414 | | |
| 227 | | |
| 641 | |
Salaries and benefits | |
| 4,752 | | |
| 3,563 | | |
| 8,315 | | |
| 2,956 | | |
| 3,323 | | |
| 6,279 | |
Share-based compensation | |
| 2,383 | | |
| — | | |
| 2,383 | | |
| 2,737 | | |
| — | | |
| 2,737 | |
| |
$ | 9,263 | | |
$ | 6,476 | | |
$ | 15,739 | | |
$ | 7,460 | | |
$ | 5,639 | | |
$ | 13,099 | |
Finance
items consist of:
| |
Three months ended September 30, | | |
Six months ended September 30, | |
Finance income | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Interest income | |
$ | 1,934 | | |
$ | 1,742 | | |
$ | 3,614 | | |
$ | 3,236 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
Three months ended September 30, | | |
Six months ended September 30, | |
Finance costs | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Interest in lease obligation | |
$ | 29 | | |
$ | 6 | | |
$ | 59 | | |
$ | 13 | |
Accretion of environmental rehabilitation liabilities | |
| 53 | | |
| 48 | | |
| 88 | | |
| 101 | |
| |
$ | 82 | | |
$ | 54 | | |
$ | 147 | | |
$ | 114 | |
The
significant components of income tax expense are as follows:
| |
Three months ended September 30, | | |
Six months ended September 30, | |
Income tax expense | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Current | |
$ | 6,076 | | |
$ | 2,485 | | |
$ | 10,397 | | |
$ | 7,368 | |
Deferred | |
| 339 | | |
| 1,393 | | |
| 3,365 | | |
| 2,731 | |
| |
$ | 6,415 | | |
$ | 3,878 | | |
$ | 13,762 | | |
$ | 10,099 | |
Short-term
investments consist of the following:
As
at September 30, 2024 | |
Carrying Value | | |
Interest rates | |
Maturity |
Bonds | |
$ | 1,310 | | |
0% - 5.5% | |
Up to January 16, 2025 |
Money market instruments | |
| 27,870 | | |
| |
|
| |
$ | 29,180 | | |
| |
|
As at March 31, 2024 | |
Carrying Value | | |
Interest rates | |
Maturity |
Bonds | |
$ | 1,329 | | |
0% - 6.9% | |
Up to January 16, 2025 |
Money market instruments | |
| 30,620 | | |
| |
|
| |
$ | 31,949 | | |
| |
|
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
As at September 30, 2024 | | |
As at March 31, 2024 | |
Investments designated as FVTOCI | |
| | |
| |
Public companies | |
$ | 529 | | |
$ | 547 | |
Private companies | |
| — | | |
| 62 | |
| |
| 529 | | |
| 609 | |
Investments designated as FVTPL | |
| | | |
| | |
Public companies | |
| 9,370 | | |
| 42,488 | |
Private companies | |
| 2,534 | | |
| 3,157 | |
| |
| 11,904 | | |
| 45,645 | |
Total | |
$ | 12,433 | | |
$ | 46,254 | |
Investments
in publicly traded companies represent equity interests of other publicly-trading mining companies that the Company has acquired through
the open market or through private placements. Investments held for trading are classified as FVTPL. For other investments, the Company
can make an irrevocable election, on an instrument-by-instrument basis, to designate them as FVTOCI.
The
continuity of such investments is as follows:
| |
Fair Value | | |
Accumulated fair
value change included
in OCI | | |
Accumulated fair
value change included
in P&L | |
As at April 1, 2023 | |
$ | 15,540 | | |
$ | (25,648 | ) | |
$ | 1,385 | |
Loss on equity investments designated as FVTOCI | |
| (67 | ) | |
| (67 | ) | |
| — | |
Gain on equity investments designated as FVTPL | |
| 9,074 | | |
| — | | |
| 9,074 | |
Acquisition | |
| 23,305 | | |
| — | | |
| — | |
Disposal | |
| (1,492 | ) | |
| — | | |
| — | |
Impact of foreign currency translation | |
| (106 | ) | |
| — | | |
| — | |
As at March 31, 2024 | |
$ | 46,254 | | |
$ | (25,715 | ) | |
$ | 10,459 | |
Loss on equity investments designated as FVTOCI | |
| (139 | ) | |
| (139 | ) | |
| — | |
Gain on equity investments designated as FVTPL | |
| 6,056 | | |
| — | | |
| 6,056 | |
Acquisition | |
| 19,784 | | |
| — | | |
| — | |
Disposal | |
| (34,202 | ) | |
| — | | |
| — | |
Transferred upon acquisition of Adventus | |
| (25,748 | ) | |
| — | | |
| — | |
Impact of foreign currency translation | |
| 428 | | |
| — | | |
| — | |
As at September 30, 2024 | |
$ | 12,433 | | |
$ | (25,854 | ) | |
$ | 16,515 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| 11. | INVESTMENT
IN ASSOCIATES |
| (a) | Investment
in New Pacific Metals Corp. |
New
Pacific Metals Corp. (“NUAG”) is a Canadian public company listed on the Toronto Stock Exchange (symbol: NUAG) and NYSE American
(symbol: NEWP). NUAG is a related party of the Company by way of one common director and one common officer, and the Company accounts
for its investment in NUAG using the equity method as it is able to exercise significant influence over the financial and operating policies
of NUAG.
As
at September 30, 2024, the Company owned 46,907,606 common shares of NUAG (March 31, 2024 – 46,904,706), representing an ownership
interest of 27.4% (March 31, 2024 – 27.4%).
The
summary of the investment in NUAG common shares and its market value as at the respective reporting dates are as follows:
| |
Number of shares | | |
Amount | | |
Value of NUAG’s common shares
per quoted market price | |
As at April 1, 2023 | |
| 44,351,616 | | |
$ | 43,253 | | |
$ | 119,621 | |
Participation in bought deal | |
| 2,541,890 | | |
| 4,982 | | |
| | |
Purchase from open market | |
| 11,200 | | |
| 15 | | |
| | |
Dilution gain | |
| | | |
| 733 | | |
| | |
Share of net loss | |
| | | |
| (1,784 | ) | |
| | |
Share of other comprehensive loss | |
| | | |
| (28 | ) | |
| | |
Foreign exchange impact | |
| | | |
| (91 | ) | |
| | |
As at March 31, 2024 | |
| 46,904,706 | | |
$ | 47,080 | | |
$ | 63,693 | |
Purchase from open market | |
| 2,900 | | |
| 4 | | |
| | |
Share of net loss | |
| | | |
| (749 | ) | |
| | |
Share of other comprehensive income | |
| | | |
| 31 | | |
| | |
Foreign exchange impact | |
| | | |
| 169 | | |
| | |
As at September 30, 2024 | |
| 46,907,606 | | |
$ | 46,535 | | |
$ | 69,498 | |
| (b) | Investment
in Tincorp Metals Inc. |
Tincorp
Metals Inc. (“TIN”), formerly Whitehorse Gold Corp., is a Canadian public company listed on the TSX Venture Exchange (symbol:
TIN). TIN is a related party of the Company by way of one common director and one common officer, and the Company accounts for its investment
in TIN using the equity method as it is able to exercise significant influence over the financial and operating policies of TIN.
As
at September 30, 2024, the Company owned 19,864,285 common shares of TIN (March 31, 2024 – 19,864,285), representing an ownership
interest of 29.7% (March 31, 2024 – 29.7%).
The
summary of the investment in TIN common shares and its market value as at the respective reporting dates are as follows:
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| |
Number of shares | | |
Amount | | |
Value of TIN’s common
shares per quoted market
price | |
As at April 1, 2023 | |
| 19,514,285 | | |
| 7,442 | | |
| 6,777 | |
Tincorp shares received under credit facility agreement | |
| 350,000 | | |
| 78 | | |
| | |
Share of net loss | |
| | | |
| (908 | ) | |
| | |
Share of other comprehensive income | |
| | | |
| (8 | ) | |
| | |
Impairment | |
| | | |
| (4,251 | ) | |
| | |
Foreign exchange impact | |
| | | |
| (7 | ) | |
| | |
As at March 31, 2024 | |
| 19,864,285 | | |
$ | 2,346 | | |
$ | 2,346 | |
Share of net loss | |
| | | |
| (135 | ) | |
| | |
Share of other comprehensive loss | |
| | | |
| (7 | ) | |
| | |
Foreign exchange impact | |
| | | |
| 7 | | |
| | |
As at September 30, 2024 | |
| 19,864,285 | | |
$ | 2,211 | | |
$ | 2,428 | |
Investment
properties consist of:
| |
Costs | | |
Accumulated
depreciation and
amortization | | |
Net carrying value | |
As at April 1, 2023 | |
$ | — | | |
$ | — | | |
$ | — | |
Additions | |
| 287 | | |
| — | | |
| 287 | |
Transfer from property, plant, and equipment | |
| 837 | | |
| (619 | ) | |
| 218 | |
Depreciation and amortization | |
| — | | |
| (39 | ) | |
| (39 | ) |
Impact of foreign currency translation | |
| (9 | ) | |
| 6 | | |
| (3 | ) |
As at March 31, 2024 | |
| 1,115 | | |
| (652 | ) | |
| 463 | |
Depreciation and amortization | |
| — | | |
| (21 | ) | |
| (21 | ) |
Impact of foreign currency translation | |
| 34 | | |
| (21 | ) | |
| 13 | |
As at September 30, 2024 | |
$ | 1,149 | | |
$ | (694 | ) | |
$ | 455 | |
Investment
properties include real estate properties that are rented out to earn rental income. The investment properties were initially recorded
at cost, and subsequently measured at cost less accumulated depreciation. Depreciation is computed on a straight-line basis based on
the nature and an estimated 20 years’ useful life of the asset. The Company did not engage an independent valuer to value the properties,
and the fair value of the properties estimated based on the quoted market prices for the similar real estate properties in the nearby
neighborhoods were approximately $1.9 million as at September 30, 2024 (March 31, 2024 - $2.8 million).
During
the three and six months ended September 30, 2024, the Company recorded rental income of $0.06 million and $0.09 million (three and six
months ended September 30, 2023 - $0.03 million and $0.06 million), which was included in other expenses (income) on the condensed consolidated
interim statements of income.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Plant
and equipment consist of:
| |
Land use
rights and
building | | |
Office
equipment | | |
Machinery | | |
Motor
vehicles | | |
Construction
in progress | | |
Total | |
Cost | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
As at April 1, 2023 | |
$ | 112,121 | | |
$ | 10,879 | | |
$ | 34,374 | | |
$ | 8,062 | | |
$ | 7,228 | | |
$ | 172,664 | |
Additions | |
| 1,020 | | |
| 853 | | |
| 1,965 | | |
| 609 | | |
| 8,469 | | |
| 12,916 | |
Disposals | |
| (1,082 | ) | |
| (234 | ) | |
| (1,033 | ) | |
| (290 | ) | |
| — | | |
| (2,639 | ) |
Reclassification of asset groups | |
| 2,209 | | |
| 461 | | |
| 840 | | |
| (410 | ) | |
| (3,100 | ) | |
| — | |
Impact of foreign currency translation | |
| (5,459 | ) | |
| (495 | ) | |
| (1,723 | ) | |
| (394 | ) | |
| (404 | ) | |
| (8,475 | ) |
As at March 31, 2024 | |
$ | 108,809 | | |
$ | 11,464 | | |
$ | 34,423 | | |
$ | 7,577 | | |
$ | 12,193 | | |
$ | 174,466 | |
Additions | |
| 21 | | |
| 290 | | |
| 1,524 | | |
| 260 | | |
| 12,088 | | |
| 14,183 | |
Acquisition of Adventus | |
| — | | |
| 51 | | |
| 347 | | |
| 125 | | |
| — | | |
| 523 | |
Disposals | |
| (265 | ) | |
| (70 | ) | |
| (102 | ) | |
| (146 | ) | |
| (2 | ) | |
| (585 | ) |
Reclassification of asset groups | |
| 1,012 | | |
| 67 | | |
| 247 | | |
| — | | |
| (1,326 | ) | |
| — | |
Impact of foreign currency translation | |
| 3,302 | | |
| 329 | | |
| 1,104 | | |
| 234 | | |
| 665 | | |
| 5,634 | |
As at September 30, 2024 | |
$ | 112,879 | | |
$ | 12,131 | | |
$ | 37,543 | | |
$ | 8,050 | | |
$ | 23,618 | | |
$ | 194,221 | |
Accumulated amortization and impairment |
As at April 1, 2023 | |
$ | (56,781 | ) | |
$ | (7,142 | ) | |
$ | (23,213 | ) | |
$ | (5,469 | ) | |
$ | — | | |
$ | (92,605 | ) |
Disposals | |
| 778 | | |
| 216 | | |
| 291 | | |
| 211 | | |
| — | | |
| 1,496 | |
Depreciation and amortization | |
| (4,315 | ) | |
| (1,031 | ) | |
| (2,263 | ) | |
| (390 | ) | |
| — | | |
| (7,999 | ) |
Impact of foreign currency translation | |
| 2,777 | | |
| 316 | | |
| 1,176 | | |
| 271 | | |
| — | | |
| 4,540 | |
As at March 31, 2024 | |
$ | (57,541 | ) | |
$ | (7,641 | ) | |
$ | (24,009 | ) | |
$ | (5,377 | ) | |
$ | — | | |
$ | (94,568 | ) |
Disposals | |
| 62 | | |
| 70 | | |
| 119 | | |
| 147 | | |
| — | | |
| 398 | |
Depreciation and amortization | |
| (2,177 | ) | |
| (476 | ) | |
| (1,095 | ) | |
| (345 | ) | |
| — | | |
| (4,093 | ) |
Impact of foreign currency translation | |
| (1,770 | ) | |
| (217 | ) | |
| (769 | ) | |
| (171 | ) | |
| — | | |
| (2,927 | ) |
As at September 30, 2024 | |
$ | (61,426 | ) | |
$ | (8,264 | ) | |
$ | (25,754 | ) | |
$ | (5,746 | ) | |
$ | — | | |
$ | (101,190 | ) |
Carrying amounts | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
As at March 31, 2024 | |
$ | 51,268 | | |
$ | 3,823 | | |
$ | 10,414 | | |
$ | 2,200 | | |
$ | 12,193 | | |
$ | 79,898 | |
As at September 30, 2024 | |
$ | 51,453 | | |
$ | 3,867 | | |
$ | 11,789 | | |
$ | 2,304 | | |
$ | 23,618 | | |
$ | 93,031 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| 14. | MINERAL
RIGHTS AND PROPERTIES |
Mineral
rights and properties consist of:
As at | |
September 30, 2024 | | |
March 31, 2024 | |
Producing mineral properties | |
$ | 326,207 | | |
$ | 299,312 | |
Non-producing mineral properties | |
| 249,509 | | |
| 19,521 | |
| |
$ | 575,716 | | |
$ | 318,833 | |
Producing properties | |
Ying Mining District | | |
GC | | |
Total | |
Carrying values | |
| | | |
| | | |
| | |
As at April 1, 2023 | |
$ | 402,012 | | |
$ | 120,118 | | |
$ | 522,130 | |
Capitalized expenditures | |
| 44,633 | | |
| 6,202 | | |
| 50,835 | |
Environmental rehabilitation | |
| 89 | | |
| 151 | | |
| 240 | |
Foreign currency translation impact | |
| (20,174 | ) | |
| (5,914 | ) | |
| (26,088 | ) |
As at March 31, 2024 | |
$ | 426,560 | | |
$ | 120,557 | | |
$ | 547,117 | |
Capitalized expenditures | |
| 26,294 | | |
| 3,812 | | |
| 30,106 | |
Foreign currency translation impact | |
| 13,718 | | |
| 3,746 | | |
| 17,464 | |
As at September 30, 2024 | |
$ | 466,572 | | |
$ | 128,115 | | |
$ | 594,687 | |
Accumulated depletion and impairment | |
| | | |
| | | |
| | |
As at April 1, 2023 | |
$ | (150,862 | ) | |
$ | (88,048 | ) | |
$ | (238,910 | ) |
Depletion | |
| (18,379 | ) | |
| (2,405 | ) | |
| (20,784 | ) |
Foreign currency translation impact | |
| 7,584 | | |
| 4,305 | | |
| 11,889 | |
As at March 31, 2024 | |
$ | (161,657 | ) | |
$ | (86,148 | ) | |
$ | (247,805 | ) |
Depletion | |
| (11,713 | ) | |
| (1,089 | ) | |
| (12,802 | ) |
Foreign currency translation impact | |
| (5,248 | ) | |
| (2,625 | ) | |
| (7,873 | ) |
| |
$ | (178,618 | ) | |
$ | (89,862 | ) | |
$ | (268,480 | ) |
Carrying values | |
| | | |
| | | |
| | |
As at March 31, 2024 | |
$ | 264,903 | | |
$ | 34,409 | | |
$ | 299,312 | |
As at September 30, 2024 | |
$ | 287,954 | | |
$ | 38,253 | | |
$ | 326,207 | |
Non-producing properties | |
BYP | | |
Kuanping | | |
El Domo | | |
Condor | | |
Total | |
Carrying values | |
| | | |
| | | |
| | | |
| | | |
| | |
As at April 1, 2023 | |
$ | 6,953 | | |
$ | 13,253 | | |
$ | — | | |
$ | — | | |
$ | 20,206 | |
Capitalized expenditures | |
| — | | |
| 290 | | |
| — | | |
| — | | |
| 290 | |
Environmental rehabilitation | |
| 20 | | |
| — | | |
| — | | |
| — | | |
| 20 | |
Foreign currency translation impact | |
| (337 | ) | |
| (658 | ) | |
| — | | |
| — | | |
| (995 | ) |
As at March 31, 2024 | |
$ | 6,636 | | |
$ | 12,885 | | |
$ | — | | |
$ | — | | |
$ | 19,521 | |
Acquisition | |
| — | | |
| — | | |
| 201,013 | | |
| 24,945 | | |
| 225,958 | |
Capitalized expenditures | |
| — | | |
| 325 | | |
| 2,533 | | |
| 569 | | |
| 3,427 | |
Foreign currency translation impact | |
| 200 | | |
| 403 | | |
| — | | |
| — | | |
| 603 | |
As at September 30, 2024 | |
$ | 6,836 | | |
$ | 13,613 | | |
$ | 203,546 | | |
$ | 25,514 | | |
$ | 249,509 | |
The
BYP Mine was placed on care and maintenance since August 2014 and the Company is conducting activities to apply for a new mining license,
but the process has taken longer than expected.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
The
Kuanping Project was acquired in 2021 and is located in Shanzhou District, Sanmenxia City, Henan Province, China, approximately 33 km
north of the Ying Mining District. The Company has completed all studies and reports required to construct the mine, and the final approval
from the provincial authorities to construct the mine is pending.
The
Company acquired the El Domo Project and the Condor Project through the acquisition of Adventus on July 31, 2024.
The
El Domo Project is a permitted, pre-construction stage copper-gold project, 75% owned by Adventus. The El Domo Project is located in
central Ecuador, approximately 150 km northeast of the major port city of Guayaquil - about a 3-hour drive. The El Domo Project spans
low-lying hills and plains between 300 to 900 m above sea level.
In
June 2024, an action seeking to void the environmental license of the El Domo project was brought in local court in Las Naves Canton,
Bolívar Province, Ecuador (the “Court”) by a group of plaintiffs alleging defects in the environmental consultation
process for the El Domo Project. The Court rejected the litigation on July 24, 2024 ruling that the Ecuadorean government correctly discharged
its environmental consultation obligations prior to issuing an environmental license for the El Domo Project. The plaintiffs filed an
appeal (the “Appeal”) to the provincial court, and the Appeal was heard by the provincial court of Bolívar Province
on October 17, 2024, but a ruling has not yet been made.
The
Condor Project is located within one of the most developed trends in Ecuador, near large-scale operations such as the Fruta del Norte
gold mine (33 km north) and the Mirador copper mine (55 km north) and 98.7% owned by Adventus.
Based
on the information posted on the website of the Mineral Rights Administration of the Department of Natural Resources of Henan Province,
China (the “Department of Natural Resources”), the Company’s application to renew Yuelianggou Mining License (the “License”),
containing the SGX and HZG silver-lead-zinc mine, located in the western part of the Ying Mining District, for another 11 years to September
24, 2035 with an increase in allowable production capacity to 500,000 tonnes per year, has been approved by the Department of Natural
Resources. An assessment report, prepared by a third party regarding the historical government investment in the License area and the
payment required to compensate the mineral resources transferred to the Company was published on the website of the Department of Natural
Resources and was available for public inquires until November 5, 2024. If the Department of Natural Resources did not receive any objections
to the assessment report by the end of the public inquiry period, the Department of Natural Resources will enter into a mineral resource
transfer agreement with the Company and a digital certificate representing the License will be issued to the Company. The Company has
not yet been made aware of any objections. Based on the current assessment report, the Company may be required to make a lump sum payment
of approximately $7.2 million to the government upon issuance of the License.
| 15. | LONG
TERM DEPOSITS RECEIVED |
In
order to develop the El Domo Project, Adventus entered into a precious metals purchase agreement (“PMPA”) with Wheaton Precious
Metals International Ltd. (“Wheaton”). The PMPA provides Adventus with access to an upfront cash consideration of $175.5 million
and a $5.0 million equity commitment. Of this, $13.0 million was made available as an early deposit (the “Early Deposit”)
for pre-construction activities, and $0.5 million for local community development initiatives (the “ESG Deposit”) prior to
production. The remainder will be available in four installments during construction, subject to certain customary conditions precedent
being satisfied.
Under
the PMPA, Wheaton will purchase 50% of the payable gold production until 145,000 ounces have been delivered, thereafter dropping to 33%
for the life of mine; and 75% of the payable silver production until 4,600,000 ounces have been delivered, thereafter dropping to 50%
for the life of mine.
Wheaton
will make ongoing payments for the gold and silver ounces delivered equal to 18% of the spot prices (“Production Payment”)
until the value of gold and silver delivered less the Production Payment is equal to the upfront consideration of $175.5 million, at
which point the Production Payment will increase to 22% of the spot prices.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
As
at September 30, 2024, Wheaton advanced Adventus a total of $13.25 million (July 31, 2024 - $13.25 million), being the $13.0 million
as Early Deposit and $0.25 million as ESG Deposit to support the training programs for members of the communities. Pursuant to the terms
of the PMPA, Adventus was required to deliver approximately 92.3 ounces to Wheaton monthly until the development of the El Domo Project
reaches certain milestones or the deposits will be repaid. The estimated liabilities of this gold delivery were $2.3 million as at September
30, 2024, which are derivative liabilities and have been included in the accounts payable and accrued liabilities on the unaudited condensed
consolidated interim statements of financial position.
The
following table summarizes changes in the Company’s lease obligation related to the Company’s office lease.
| |
Lease Obligations | |
As at April 1, 2023 | |
$ | 583 | |
Addition | |
| 998 | |
Interest accrual | |
| 22 | |
Interest received or paid | |
| (22 | ) |
Principal repayment | |
| (262 | ) |
Foreign exchange impact | |
| (4 | ) |
As at March 31, 2024 | |
$ | 1,315 | |
Addition | |
| 16 | |
Interest accrual | |
| 59 | |
Interest received or paid | |
| (59 | ) |
Principal repayment | |
| (85 | ) |
Foreign exchange impact | |
| 4 | |
As at September 30, 2024 | |
$ | 1,250 | |
Less: current portion | |
| 231 | |
Non-current portion | |
$ | 1,019 | |
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
The
following table presents a reconciliation of the Company’s undiscounted cash flows to their present value for its lease obligation
as at September 30, 2024:
| |
Lease Obligations | |
Within 1 year | |
$ | 292 | |
Between 2 to 5 years | |
$ | 1,108 | |
Over 5 years | |
| 195 | |
Total undiscounted amount | |
| 1,595 | |
Less future interest | |
| (345 | ) |
Total discounted amount | |
$ | 1,250 | |
Less: current portion | |
| 231 | |
Non-current portion | |
$ | 1,019 | |
The
lease obligations were discounted at discount rates ranging from 9.2% to 15.6% as at September 30, 2024.
| 17. | ENVIRONMENTAL
REHABILITATION OBLIGATION |
The
following table presents the reconciliation of the beginning and ending obligations associated with the retirement of the properties:
| |
Environmental
rehabilitation obligation | |
As at April 1, 2023 | |
$ | 7,318 | |
Reclamation expenditures | |
| (970 | ) |
Accretion of environmental rehabilitation liabilities | |
| 191 | |
Revision of provision | |
| 259 | |
Foreign exchange impact | |
| (356 | ) |
As at March 31, 2024 | |
$ | 6,442 | |
Reclamation expenditures | |
| (475 | ) |
Accretion of environmental rehabilitation liabilities | |
| 88 | |
Foreign exchange impact | |
| 186 | |
As at September 30, 2024 | |
$ | 6,241 | |
Unlimited
number of common shares without par value. All shares issued as at September 30, 2024 were fully paid.
| (b) | Share-based
compensation |
The
Company has a share-based compensation plan (the “Plan”) which consists of stock options, restricted share units (the “RSUs”)
and performance share units (the “PSUs”). The Plan allows for the maximum number of common shares to be reserved for issuance
on any share-based compensation to be a rolling 10% of the issued and outstanding common shares from time to time. Furthermore, no more
than 3% of the reserve may be granted in the form of RSUs and PSUs.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
For
the three and six months ended September 30, 2024, a total of $1.2 million and $2.4 million (three and six months ended September 30,
2023 - $1.4 million and $2.7 million) in share-based compensation expense was recognized and included in the corporate general and administrative
expenses and property evaluation and business development expenses on the condensed consolidated interim statements of income.
The
following is a summary of option transactions:
| |
Number of options | | |
Weighted average
exercise price per
share CAD | |
Balance, April 1, 2023 | |
| 1,431,668 | | |
$ | 6.01 | |
Options cancelled/forfeited | |
| (104,667 | ) | |
| 5.83 | |
Balance, March 31, 2024 | |
| 1,327,001 | | |
$ | 6.02 | |
Options granted to directors, officers and employees | |
| 330,000 | | |
| 4.41 | |
Replacement options issued upon Adventus Acquisition | |
| 1,766,721 | | |
| 5.71 | |
Options exercised | |
| (450,131 | ) | |
| 3.74 | |
Options cancelled/forfeited | |
| (5,000 | ) | |
| 9.45 | |
Balance, September 30, 2024 | |
| 2,968,591 | | |
$ | 6.00 | |
The
following table summarizes information about stock options outstanding as at September 30, 2024:
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Exercise
price in
CAD | | |
Number of options
outstanding at September 30, 2024 | | |
Weighted average
remaining
contractual life
(Years) | | |
Number of options
exercisable at September 30, 2024 | | |
Weighted average
exercise price in
CAD | |
| $12.52 | | |
| 35,525 | | |
| 1.17 | | |
| 35,525 | | |
| $12.52 | |
| 9.96 | | |
| 41,956 | | |
| 1.16 | | |
| 41,956 | | |
| 9.96 | |
| 9.56 | | |
| 81,200 | | |
| 0.06 | | |
| 81,200 | | |
| 9.56 | |
| 9.45 | | |
| 370,000 | | |
| 1.11 | | |
| 370,000 | | |
| 9.45 | |
| 9.27 | | |
| 39,236 | | |
| 0.04 | | |
| 39,236 | | |
| 9.27 | |
| 9.07 | | |
| 224,989 | | |
| 2.34 | | |
| 224,989 | | |
| 9.07 | |
| 8.48 | | |
| 50,750 | | |
| 0.35 | | |
| 50,750 | | |
| 8.48 | |
| 7.99 | | |
| 126,875 | | |
| 2.38 | | |
| 126,875 | | |
| 7.99 | |
| 7.49 | | |
| 49,096 | | |
| 2.15 | | |
| 49,096 | | |
| 7.49 | |
| 6.21 | | |
| 15,225 | | |
| 2.66 | | |
| 15,225 | | |
| 6.21 | |
| 5.46 | | |
| 405,667 | | |
| 0.65 | | |
| 405,667 | | |
| 5.46 | |
| 5.13 | | |
| 361,658 | | |
| 3.30 | | |
| 361,658 | | |
| 5.13 | |
| 4.93 | | |
| 5,075 | | |
| 3.24 | | |
| 5,075 | | |
| 4.93 | |
| 4.41 | | |
| 330,000 | | |
| 4.50 | | |
| — | | |
| — | |
| 4.08 | | |
| 60,000 | | |
| 3.40 | | |
| 30,000 | | |
| 4.08 | |
| 3.93 | | |
| 341,334 | | |
| 2.57 | | |
| 195,333 | | |
| 3.93 | |
| 3.75 | | |
| 10,150 | | |
| 2.99 | | |
| 10,150 | | |
| 3.75 | |
| 3.65 | | |
| 24,514 | | |
| 3.15 | | |
| 24,514 | | |
| 3.65 | |
| 3.16 | | |
| 76,125 | | |
| 4.49 | | |
| 76,125 | | |
| 3.16 | |
| 3.06 | | |
| 10,150 | | |
| 1.07 | | |
| 10,150 | | |
| 3.06 | |
| 2.67 | | |
| 309,066 | | |
| 4.32 | | |
| 309,066 | | |
| 2.67 | |
| $12.52 | | |
| 2,968,591 | | |
| 2.47 | | |
| 2,462,590 | | |
| $6.36 | |
The
options exercisable at September 30, 2024 have a weighted average exercise price of $6.36 (March 31, 2024 - $6.52).
The
fair value of stock options granted during the six months ended September 30, 2024 were calculated as of the date of grant using the
Black-Scholes option pricing model with the following weighted average assumptions:
| |
Six
months ended September 30, |
|
| |
2024 |
|
Risk free interest
rate | |
| 3.39% |
|
Expected life of option in
years | |
| 3.11
years |
|
Expected volatility | |
| 50.14% |
|
Expected dividend yield | |
| 0.68% |
|
Estimated forfeiture rate | |
| 9.77% |
|
Weighted average
share price at date of grant | |
| $5.08 CAD |
|
Subsequent
to September 30, 2024, a total of 440,602 stock options with grant date closing prices of CAD$2.67 to CAD$5.46 were exercised, and a
total of 143,770 stock options were cancelled and/or forfeited.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| (ii) | Share
purchase warrants |
The
following is a summary of share purchase warrant transactions:
| |
Number of warrants | | |
Weighted average exercise price CAD | |
Balance, April 1, 2023 and 2024 | |
| — | | |
$ | — | |
Warrants issued upon Adventus acquisition | |
| 2,787,020 | | |
| 5.46 | |
Balance, September 30, 2024 | |
| 2,787,020 | | |
$ | 5.46 | |
The
following table summarizes information about share purchase warrants outstanding as at September 30, 2024:
| |
Exercise price CAD | | |
Number of warrants
outstanding at
September 30, 2024 | | |
Expiry date |
|
Warrants issued upon Adventus acquisition | |
$ | 6.47 | | |
| 1,416,771 | | |
February 16, 2025 |
|
Warrants issued upon Adventus acquisition | |
| 4.41 | | |
| 1,370,249 | | |
August 3, 2026 |
|
| |
| | | |
| 2,787,020 | | |
|
|
The
fair value of share purchase warrants issued during the six months ended September 30, 2024 were calculated as of the date of grant using
the Black-Scholes option pricing model with the following weighted average assumptions:
| |
Six
months ended
September 30, 2024 |
|
Risk free interest
rate | |
| 3.43% |
|
Expected life in years | |
| 1.27
years |
|
Expected volatility | |
| 46.55% |
|
Expected dividend yield | |
| 0.68% |
|
Estimated forfeiture rate | |
| —% |
|
Weighted average
share price at date of issuance | |
| $
5.21 CAD |
|
Subsequent
to September 30, 2024, a total of 6,939 share purchase warrants with grant date closing price of CAD$6.47 were exercised.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
The
following is a summary of RSUs transactions:
| |
Number of units | | |
Weighted average
grant date closing
price per share CAD | |
Balance, April 1, 2023 | |
| 2,126,670 | | |
$ | 5.29 | |
Granted | |
| 1,056,000 | | |
| 5.28 | |
Forfeited | |
| (113,665 | ) | |
| 5.04 | |
Distributed | |
| (928,755 | ) | |
| 5.44 | |
Balance, March 31, 2024 | |
| 2,140,250 | | |
$ | 5.23 | |
Granted | |
| 1,044,750 | | |
| 4.41 | |
Forfeited | |
| (14,333 | ) | |
| 4.82 | |
Distributed | |
| (345,329 | ) | |
| 6.44 | |
Balance, September 30, 2024 | |
| 2,825,338 | | |
$ | 4.78 | |
During
the three and six months ended September 30, 2024, a total of nil and 1,044,750 RSUs were granted to directors, officers, and employees
of the Company at grant date closing prices of CAD$4.41 per share subject to a vesting schedule over a three-year term with 1/6 of the
RSUs vesting every six months from the date of grant.
Subsequent
to September 30, 2024, a total of 188,456 RSUs with grant date closing prices of CAD$4.0 to CAD$5.28 were distributed, and a total of
27,084 RSUs were cancelled and/or forfeited.
| (c) | Cash
dividends declared |
During
the three and six months ended September 30, 2024, dividends of $nil and $2.2 million or $0.0125 per share, respectively, (three and
six months ended September 30, 2023 - $nil and $2.2 million or $0.025 per share) were declared and paid.
| (d) | Normal
course issuer bid |
On
September 17, 2024, the Company announced a normal course issuer bid (the “2024 NCIB”) commencing September 19, 2024 to repurchase
up to 8,670,700 of its own common shares until September 18, 2025.
| 19. | ACCUMULATED
OTHER COMPREHENSIVE LOSS |
As at | |
September 30, 2024 | | |
March 31, 2024 | |
Loss on investments designated as FVTOCI | |
$ | 24,560 | | |
$ | 24,421 | |
Share of loss in associate | |
| 1,425 | | |
| 1,449 | |
Loss on currency translation adjustment | |
| 23,393 | | |
| 34,175 | |
| |
$ | 49,378 | | |
$ | 60,045 | |
The
change in fair value on equity investments designated as FVTOCI, share of other comprehensive loss in associates, and currency translation
adjustment are net of tax of $nil for all periods presented.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
| 20. | NON-CONTROLLING
INTERESTS |
Tables
below summarize the financial information and continuity of the Company’s material non-controlling interests:
As of September 30, 2024 | |
Henan
Found | | |
Henan
Huawei | | |
Yunxiang | | |
Salazar
Holdings | |
Non-controlling interests percentage | |
| 22.5 | % | |
| 20.0 | % | |
| 30.0 | % | |
| 25.0 | % |
Current assets | |
$ | 100,303 | | |
$ | 1,881 | | |
$ | 609 | | |
$ | 2,098 | |
Non-current assets | |
| 357,082 | | |
| 10,118 | | |
| 9,582 | | |
| 204,547 | |
Current liabilities | |
| (55,927 | ) | |
| (1,879 | ) | |
| (271 | ) | |
| (6,057 | ) |
Non-current liabilities | |
| (55,356 | ) | |
| (1,400 | ) | |
| (36,845 | ) | |
| (41,784 | ) |
Net Assets (deficit) | |
$ | 346,102 | | |
$ | 8,720 | | |
$ | (26,925 | ) | |
$ | 158,804 | |
| |
| | | |
| | | |
| | | |
| | |
Revenue | |
$ | 121,395 | | |
$ | 14,849 | | |
$ | — | | |
$ | — | |
Net income (loss) and comprehensive income (loss) | |
$ | 61,477 | | |
$ | 3,865 | | |
$ | (27 | ) | |
$ | 222 | |
Cash flows provided by (used in) operating activities | |
$ | 59,164 | | |
$ | 976 | | |
$ | (111 | ) | |
$ | (33 | ) |
Cash flows used in investing activities | |
$ | (33,064 | ) | |
$ | (13 | ) | |
$ | — | | |
$ | (2,198 | ) |
Cash flows used in financing activities | |
$ | (33,004 | ) | |
$ | (3,141 | ) | |
$ | — | | |
$ | (3 | ) |
Non-controlling interest continuity | |
Henan
Found | | |
Henan
Huawei | | |
Yunxiang | | |
Salazar
Holdings | |
As at April 1, 2023 | |
$ | 85,282 | | |
$ | 3,510 | | |
$ | 2,640 | | |
$ | — | |
Share of net income (loss) | |
| 12,846 | | |
| 673 | | |
| (151 | ) | |
| — | |
Share of other comprehensive loss | |
| (3,063 | ) | |
| (55 | ) | |
| (96 | ) | |
| — | |
Distribution | |
| (10,088 | ) | |
| (950 | ) | |
| — | | |
| — | |
As at March 31, 2024 | |
$ | 84,977 | | |
$ | 3,178 | | |
$ | 2,393 | | |
$ | — | |
Acquisition | |
| — | | |
| — | | |
| — | | |
| 23,204 | |
Share of net income (loss) | |
| 10,938 | | |
| 602 | | |
| (61 | ) | |
| 40 | |
Share of other comprehensive income | |
| 2,776 | | |
| 171 | | |
| 53 | | |
| — | |
Adjustment to NCI | |
| — | | |
| — | | |
| — | | |
| 5,603 | |
Distribution | |
| (10,128 | ) | |
| (921 | ) | |
| — | | |
| — | |
As at September 30, 2024 | |
$ | 88,563 | | |
$ | 3,030 | | |
$ | 2,385 | | |
$ | 28,847 | |
During
the year ended March 31, 2024, Henan Non-ferrous transferred 12.25% equity interest of Henan Found to Henan First Geological Brigade
Ltd. (“First Geological Brigade”), a company who has the same ultimate parent company as Henan Non-ferrous. As at March 31,
2024, Henan Non-ferrous is the 5.25% equity holder of Henan Found and First Geological Brigade is the 12.25% equity holder of Henan Found.
Salazar
Resources Ltd. (“Salazar”) is 25% owner of the common share of Salazar Holding Limited (“Salazar Holding”), who
owns 100% interest in the El Domo Project. Pursuant to the option agreement and shareholders’ agreement with Salazar, the Company
has priority repayment of its investment in the El Domo according to an agreed distribution formula. Based on this formula, the percentage
share of non-controlling interest will change as a function of advances made by the Company and the earnings or loss recorded by Salazar
Holdings and its subsidiaries over the time. After the Company has
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
received priority repayment of its investment, the non-controlling
interest will revert to 25%. As at September 30, 2024, the effective percentage of the non-controlling interest in Salazar Holding is
18.17%.
| 21. | RELATED
PARTY TRANSACTIONS |
Related
party transactions are made on terms agreed upon by the related parties. The balances with related parties are unsecured, non-interest
bearing, and due on demand. Related party transactions not disclosed elsewhere in the unaudited condensed consolidated interim financial
statements are as follows:
| (a) | Due
from related parties |
As at | |
September 30, 2024 | | |
March 31, 2024 | |
NUAG (i) | |
$ | 80 | | |
$ | 28 | |
TIN (ii) | |
| 1117 | | |
| 562 | |
| |
$ | 1,197 | | |
$ | 590 | |
| i. | The
Company recovers costs for services rendered to NUAG and expenses incurred on behalf of NUAG pursuant to a services and administrative
costs reallocation agreement. During the three and six months ended September 30, 2024, a total of $0.3 million and $0.5 million (three
and six months ended September 30, 2023 - $0.2 million and $0.5 million, respectively) of services rendered to and expenses incurred
on behalf of NUAG. The costs recoverable from NUAG were recorded as a direct reduction of general and administrative expenses on the
condensed consolidated interim statements of income. |
| ii. | The
Company recovers costs for services rendered to TIN and expenses incurred on behalf of TIN pursuant to a services and administrative
costs reallocation agreement. During the three and six months ended September 30, 2024, a total of $0.02 million and $0.05 million (three
and six months ended September 30, 2023 - $0.05 million and $0.13 million, respectively) of services rendered to and expenses incurred
on behalf of TIN. The costs recoverable from TIN were recorded as a direct reduction of general and administrative expenses on the condensed
consolidated interim statements of income. In January 2024, the Company and TIN entered into an interest-free unsecured credit facility
agreement with no conversion features (the “Facility”) to allow TIN to advance up to $1.0 million from the Company. In January
2024, the Company advanced $0.5 million to TIN and received 350,000 common shares of TIN as the Bonus Shares for granting the Facility.
In April 2024, the Company advanced the remaining $0.5 million to TIN. |
The
Company’s objectives of capital management are intended to safeguard the entity’s ability to support the Company’s
normal operating requirement on an ongoing basis, continue the development and exploration of its mineral properties, and support any
expansionary plans.
The
capital of the Company consists of the items included in equity less cash and cash equivalents and short-term investments. Risk and capital
management are primarily the responsibility of the Company’s corporate finance function and are monitored by the Board of Directors.
The Company manages the capital structure and makes adjustments depending on economic conditions. Funds have been primarily secured
through profitable operations and issuances of equity capital. The Company invests all capital that is surplus to its immediate needs
in short-term, liquid and highly rated financial instruments, such as cash and other short-term deposits, all held with major financial
institutions. Significant risks are monitored and actions are taken, when necessary, according to the Company’s approved policies.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
The
Company manages its exposure to financial risks, including liquidity risk, foreign exchange risk, interest rate risk, credit risk and
equity price risk in accordance with its risk management framework. The Company’s Board of Directors has overall responsibility
for the establishment and oversight of the Company’s risk management framework and reviews the Company’s policies on an ongoing
basis.
The
Company classifies its fair value measurements within a fair value hierarchy, which reflects the significance of the inputs used in making
the measurements as defined in IFRS 13, Fair Value Measurement (“IFRS 13”).
Level
1 – Unadjusted quoted prices at the measurement date for identical assets or liabilities in active markets.
Level
2 – Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in
active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are
observable or can be corroborated by observable market data.
Level
3 – Unobservable inputs which are supported by little or no market activity.
The
following tables set forth the Company’s financial assets and liabilities that are measured at fair value level on a recurring
basis within the fair value hierarchy as at September 30, 2024 and March 31, 2024 that are not otherwise disclosed. As required by IFRS
13, the assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value
measurement.
| |
Fair value as at September 30, 2024 | |
Recurring measurements | |
Level 1 | | |
Level 2 | | |
Level 3 | | |
Total | |
Financial assets | |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents | |
$ | 180,325 | | |
$ | — | | |
$ | — | | |
$ | 180,325 | |
Short-term investments - money market instruments | |
| 27,870 | | |
| — | | |
| — | | |
| 27,870 | |
Investments in public companies | |
| 9,899 | | |
| — | | |
| — | | |
| 9,899 | |
Investments in private companies | |
| — | | |
| — | | |
| 2,534 | | |
| 2,534 | |
| |
| | | |
| | | |
| | | |
| | |
Financial liability | |
| | | |
| | | |
| | | |
| | |
Accounts payable and accrued liabilities - derivative liabilities | |
| — | | |
| — | | |
| 2,290 | | |
| 2,290 | |
| |
Fair value as at March 31, 2024 | |
Recurring measurements | |
Level 1 | | |
Level 2 | | |
Level 3 | | |
Total | |
Financial assets | |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents | |
$ | 152,942 | | |
$ | — | | |
$ | — | | |
$ | 152,942 | |
Short-term investments - money market instruments | |
| 30,620 | | |
| — | | |
| — | | |
| 30,620 | |
Investments in public companies | |
| 41,818 | | |
| — | | |
| 1,217 | | |
| 43,035 | |
Investments in private companies | |
| — | | |
| — | | |
| 3,219 | | |
| 3,219 | |
Financial
assets classified within Level 3 are equity investments in private companies and one public company which are suspended from quotation
owned by the Company. Significant unobservable inputs are used to determine the fair value of the financial assets, which includes recent
arm’s length transactions of the investee, the investee’s financial performance as well as any changes in planned milestones
of the investees.
SILVERCORP
METALS INC.
Notes
to Unaudited Condensed Consolidated Interim Financial Statements |
(Tabular
amounts are in thousands of U.S. dollars, except numbers for share and per share figures or otherwise stated)
Fair
value of the other financial instruments excluded from the table above approximates their carrying amount as at September 30, 2024 and
March 31, 2024, due to the short-term nature of these instruments.
There
were no transfers into or out of Level 3 during the three and six months ended September 30, 2024 and 2023.
Liquidity
risk is the risk that the Company will not be able to meet its financial obligations as they arise. The Company manages liquidity risk
by monitoring actual and projected cash flows and matching the maturity profile of financial assets and liabilities. Cash flow forecasting
is performed regularly to ensure that there is sufficient capital in order to meet short-term business requirements, after considering
cash flows from operations and our holdings of cash and cash equivalents, and short-term investments.
In
the normal course of business, the Company enters into contracts that give rise to commitments for future minimum payments. The following
summarizes the remaining contractual maturities of the Company’s financial liabilities and operating commitments on an undiscounted
basis.
| |
September 30, 2024 | |
| |
Within a year | | |
2-5 years | | |
Over 5 years | | |
Total | |
Accounts payable and accrued liabilities | |
$ | 73,435 | | |
$ | — | | |
$ | — | | |
$ | 73,435 | |
Lease obligation | |
| 292 | | |
| 1,108 | | |
| 195 | | |
| 1,595 | |
Deposits received | |
| 4,446 | | |
| 13,250 | | |
| — | | |
| 17,696 | |
Total Contractual Obligation | |
$ | 78,173 | | |
$ | 14,358 | | |
$ | 195 | | |
$ | 92,726 | |
The
Company reports its financial statements in US dollars. The functional currency of the head office, Canadian subsidiaries and all intermediate