Americas Gold and Silver Corporation (TSX: USA) (NYSE American:
USAS) (“Americas” or the “Company”), a growing North American
precious metals producer, reports consolidated financial and
operational results for the quarter ended March 31, 2024.
This earnings release should be read in conjunction with the
Company’s Management’s Discussion and Analysis, Financial
Statements and Notes to Financial Statements for the corresponding
period, which have been posted on the Americas Gold and Silver
Corporation SEDAR+ profile at www.sedarplus.ca, and on its EDGAR
profile at www.sec.gov, and which are also available on the
Company’s website at www.americas-gold.com. All figures are in U.S.
dollars unless otherwise noted.
Highlights
- Revenue decreased to $19.5 million for Q1-2024 or 12% compared
to $22.1 million for Q1-2023, resulting from lower realized zinc
price at the Cosalá Operations and lower silver and lead production
from the Galena Complex, offset by higher silver production from
the Cosalá Operations.
- A net loss of $16.2 million for Q1-2024, or an attributable
loss of $0.07 per share representing an increase in net loss of
$5.7 million compared to Q1-2023, primarily due to lower net
revenue, higher cost of sales, and higher loss on non-cash
derivatives related to the convertible debenture, offset in part by
lower interest and financing expense.
- As previously reported, Q1-2024 attributable silver production
was 0.48 million ounces compared with approximately 0.50 million
ounces in Q1-2023. The Company also produced approximately 8.0
million attributable pounds of zinc and 4.0 million attributable
pounds of lead during Q1-2024.
- Production from the Cosalá Operations was strong as the
operation benefitted from above budgeted silver grades and
recoveries. The Galena Complex production was slightly below budget
as focus during the quarter was re-allocated to lateral development
to access the new mining areas in the Upper Country Lead Zone veins
between 2400 and 2800 levels. This silver-lead area commenced ore
production subsequent to quarter end and will provide 4,000-5,000
tons per month of base load silver-lead production for the next
several years.
- Consolidated attributable cash costs of $20.53/oz silver
produced[1] and all-in sustaining costs of $29.20/oz silver
produced[1] during the quarter.
- The Company expects to close on a financing with a metal trader
for the anticipated initial capital requirements of the 100%-owned
EC120 Project at the Cosalá Operations in Q2-2024 with the goal of
producing higher-grade silver-copper concentrates in early 2025.
The 2019 Preliminary Feasibility Study for the EC120 Project
forecasted average annual metal production of 2.5 million ounces of
silver and 4.5 million pounds of copper with a total of over 12
million ounces of silver and 23.0 million pounds of copper over a
mine life of approximately 5 years.
“I am optimistic about the remainder of the year despite an
expected, but lower production quarter. Increasing silver and base
metals prices coupled with expected higher silver production from
the Galena Complex should greatly improve operating results over
the next three quarters,” stated Americas President and CEO Darren
Blasutti. “Ore production from the newly developed 2400 Level at
the Galena Complex has commenced, providing a larger monthly base
load of silver-lead production. In addition, development on the
3700 Level at the Galena Complex has begun into a high-grade
silver-copper area with initial production expected at the start of
Q3-2024.”
Cosalá Operations
The Cosalá Operations produced approximately 295,000 ounces of
silver, 2.8 million pounds of lead and 8.0 million pounds of zinc
in Q1-2024, compared with approximately 265,000 ounces of silver,
2.7 million pounds of lead and 7.2 million pounds of zinc in
Q1-2023. Silver and zinc production increased by over 10%
year-over-year while lead production was essentially unchanged.
With the current higher silver and copper price, the Company
decided to expedite the development of its 100%-owned EC120 Project
at the Cosalá Operations. Initial access to the Zone 120 deposit
occurred in Q3-2023 from the San Rafael Upper Zone development. In
addition, the Company continues mining and processing silver-zinc
ore from the San Rafael Main and Upper Zones and is expecting to
benefit from the increase in zinc prices experienced to date in the
second quarter.
The Company expects to close in Q2-2023 on a financing with an
international metal trader to provide financing for the anticipated
initial capital requirements at the EC120 Project. The Company
expects to complete the required development and preparations to
begin producing higher-grade silver-copper concentrates from the
Project at the beginning of 2025. The 2019 Preliminary Feasibility
Study for the EC120 Project forecasted average annual metal
production of 2.5 million ounces of silver and 4.5 million pounds
of copper with a total of over 12 million ounces of silver and 23.0
million pounds of copper over the five years of the project.
Cash costs per silver ounce increased in the quarter to $16.35
per ounce from $4.61 per ounce in Q1-2023 due to higher cost of
sales, lower realized Q1-2024 zinc prices and the devaluation of
the USD relative to the Mexican peso.
Galena Complex
Attributable production from the 60% owned Galena Complex was
approximately 187,000 ounces of silver and 1.1 million pounds of
lead in Q1-2024, compared to approximately 235,000 ounces of silver
and 2.8 million pounds of lead in Q1-2023. During the quarter, the
Company focused on horizontal development work in the Upper Country
Lead Zone between the 2400 and 2800 Levels to access additional
working areas. The development work reduced silver and lead
production in the quarter but is expected to positively impact
overall production for the remainder of the year and going forward.
The mining crews have been relocated to accelerate development into
a high-grade silver copper stope accessed off of the 3700 level
which will add high-grade silver-copper production commencing in
Q3-2024.
Cash costs increased to $27.14 per silver ounce in Q1-2024 from
$18.59 per silver ounce in Q1-2023 mainly due to lower silver and
lead production during the quarter. Cash costs and all-in
sustaining costs per silver ounce at the Galena Complex are
anticipated to decrease with the projected increase in production
and the completion of the Galena Hoist project as the benefits of
economies of scale on the existing cost base are realized.
About Americas Gold and Silver Corporation
Americas Gold and Silver Corporation is a high-growth precious
metals mining company with multiple assets in North America. The
Company owns and operates the Cosalá Operations in Sinaloa, Mexico,
manages the 60%-owned Galena Complex in Idaho, USA, and is
re-evaluating the Relief Canyon mine in Nevada, USA. The Company
also owns the San Felipe development project in Sonora, Mexico. For
further information, please see SEDAR+ or
www.americas-gold.com.
Technical Information and Qualified Persons
The scientific and technical information relating to the
Company’s material mining properties contained herein has been
reviewed and approved by Chris McCann, P.Eng., Vice President,
Technical Services of the Company. The Company’s current Annual
Information Form and the NI 43-101 Technical Reports for its
mineral properties, all of which are available on SEDAR+ at
www.sedarplus.ca, and EDGAR at www.sec.gov, contain further details
regarding mineral reserve and mineral resource estimates,
classification and reporting parameters, key assumptions and
associated risks for each of the Company’s material mineral
properties, including a breakdown by category.
All mining terms used herein have the meanings set forth in
National Instrument 43-101 – Standards of Disclosure for Mineral
Projects (“NI 43-101”), as required by Canadian securities
regulatory authorities. These standards differ from the
requirements of the SEC that are applicable to domestic United
States reporting companies. Any mineral reserves and mineral
resources reported by the Company in accordance with NI 43-101 may
not qualify as such under SEC standards. Accordingly, information
contained in this news release may not be comparable to similar
information made public by companies subject to the SEC’s reporting
and disclosure requirements.
Cautionary Statement on Forward-Looking Information:
This news release contains “forward-looking information” within
the meaning of applicable securities laws. Forward-looking
information includes, but is not limited to, Americas’
expectations, intentions, plans, assumptions and beliefs with
respect to, among other things, estimated and targeted production
rates and results for gold, silver and other metals, the expected
prices of gold, silver and other metals, as well as the related
costs, expenses and capital expenditures; production from the
Galena Complex and Cosalá Operations, including the expected number
of producing stopes and production levels; the expected timing and
completion of required development and the expected operational and
production results therefrom, including the anticipated
improvements to production rates and cash costs per silver ounce
and all-in sustaining costs per silver ounce; and statements
relating to Americas’ EC120 Project, including expected approvals,
prepayment financing availability, execution and timing and capital
expenditures required to develop such project and reach production
thereat, and expectations regarding its ability to rely in existing
infrastructure, facilities, and equipment. Guidance and outlook
references contained in this press release were prepared based on
current mine plan assumptions with respect to production,
development, costs and capital expenditures, the metal price
assumptions disclosed herein, and assumes no further adverse
impacts to the Cosalá Operations from blockades or work stoppages,
and completion of the shaft repair and shaft rehab work at the
Galena Complex on its expected schedule and budget, the realization
of the anticipated benefits therefrom, and is subject to the risks
and uncertainties outlined below. The ability to maintain cash flow
positive production at the Cosalá Operations, which includes the
EC120 Project, through meeting production targets and at the Galena
Complex through implementing the Galena Recapitalization Plan,
including the completion of the Galena shaft repair and shaft rehab
work on its expected schedule and budget, allowing the Company to
generate sufficient operating cash flows while facing market
fluctuations in commodity prices and inflationary pressures, are
significant judgments in the consolidated financial statements with
respect to the Company’s liquidity. Should the Company experience
negative operating cash flows in future periods, the Company may
need to raise additional funds through the issuance of equity or
debt securities. Often, but not always, forward-looking information
can be identified by forward-looking words such as “anticipate”,
“believe”, “expect”, “goal”, “plan”, “intend”, “potential’,
“estimate”, “may”, “assume” and “will” or similar words suggesting
future outcomes, or other expectations, beliefs, plans, objectives,
assumptions, intentions, or statements about future events or
performance. Forward-looking information is based on the opinions
and estimates of Americas as of the date such information is
provided and is subject to known and unknown risks, uncertainties,
and other factors that may cause the actual results, level of
activity, performance, or achievements of Americas to be materially
different from those expressed or implied by such forward-looking
information. With respect to the business of Americas, these risks
and uncertainties include risks relating to widespread epidemics or
pandemic outbreak, actions that have been and may be taken by
governmental authorities to contain such epidemic or pandemic or to
treat its impact and/or the availability, effectiveness and use of
treatments and vaccines (including the effectiveness of boosters);
interpretations or reinterpretations of geologic information;
unfavorable exploration results; inability to obtain permits
required for future exploration, development or production; general
economic conditions and conditions affecting the industries in
which the Company operates; the uncertainty of regulatory
requirements and approvals; potential litigation; fluctuating
mineral and commodity prices; the ability to obtain necessary
future financing on acceptable terms or at all; the ability to
operate the Company’s projects; and risks associated with the
mining industry such as economic factors (including future
commodity prices, currency fluctuations and energy prices), ground
conditions, illegal blockades and other factors limiting mine
access or regular operations without interruption, failure of
plant, equipment, processes and transportation services to operate
as anticipated, environmental risks, government regulation, actual
results of current exploration and production activities, possible
variations in ore grade or recovery rates, permitting timelines,
capital and construction expenditures, reclamation activities,
labor relations or disruptions, social and political developments,
risks associated with generally elevated inflation and inflationary
pressures, risks related to changing global economic conditions,
and market volatility, risks relating to geopolitical instability,
political unrest, war, and other global conflicts may result in
adverse effects on macroeconomic conditions including volatility in
financial markets, adverse changes in trade policies, inflation,
supply chain disruptions and other risks of the mining industry.
Although the Company has attempted to identify important factors
that could cause actual results to differ materially from those
contained in forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated, or
intended. Readers are cautioned not to place undue reliance on such
information. Additional information regarding the factors that may
cause actual results to differ materially from this forward‐looking
information is available in Americas’ filings with the Canadian
Securities Administrators on SEDAR+ and with the SEC. Americas does
not undertake any obligation to update publicly or otherwise revise
any forward-looking information whether as a result of new
information, future events or other such factors which affect this
information, except as required by law. Americas does not give any
assurance (1) that Americas will achieve its expectations, or (2)
concerning the result or timing thereof. All subsequent written and
oral forward‐looking information concerning Americas are expressly
qualified in their entirety by the cautionary statements above.
1 This metric is a non-GAAP financial measure or ratio. The
Company uses the financial measures “Cash Cost”, “Cash Cost/Ag Oz
Produced”, “All-In Sustaining Cost”, and “All-In Sustaining Cost/Ag
Oz Produced” in accordance with measures widely reported in the
silver mining industry as a benchmark for performance measurement
and because it understands that, in addition to conventional
measures prepared in accordance with IFRS, certain investors and
analysts use this information to evaluate the Company’s underlying
cash costs and total costs of operations. Cash costs are determined
on a mine-by-mine basis and include mine site operating costs such
as mining, processing, administration, production taxes and
royalties which are not based on sales or taxable income
calculations, while all-in sustaining costs is the cash costs plus
all development, capital expenditures, and exploration
spending.
Reconciliation of Consolidated Cash
Costs/Ag Oz Produced(a)
Q1-2024
Q1-2023
Cost of sales ('000)
$19,675
$17,479
Less non-controlling interests portion
('000)
(3,426)
(3,959)
Attributable cost of sales ('000)
16,249
13,520
Non-cash costs ('000)
82
279
Direct mining costs ('000)
$16,331
$13,799
Smelting, refining and royalty expenses
('000)
4,343
5,242
Less by-product credits ('000)
(10,779)
(13,457)
Cash costs ('000)
$9,895
$5,584
Divided by silver produced (oz)
481,936
499,677
Cash costs/Ag oz produced ($/oz)
$20.53
$11.18
Reconciliation of Cosalá Operations
Cash Costs/Ag Oz Produced
Q1-2024
Q1-2023
Cost of sales ('000)
$11,109
$7,582
Non-cash costs ('000)
(348)
292
Direct mining costs ('000)
$10,761
$7,874
Smelting, refining and royalty expenses
('000)
3,849
4,188
Less by-product credits ('000)
(9,782)
(10,839)
Cash costs ('000)
$4,828
$1,223
Divided by silver produced (oz)
295,278
265,121
Cash costs/Ag oz produced ($/oz)
$16.35
$4.61
Reconciliation of Galena Complex Cash
Costs/Ag Oz Produced
Q1-2024
Q1-2023
Cost of sales ('000)
$8,566
$9,897
Non-cash costs ('000)
716
(21)
Direct mining costs ('000)
$9,282
$9,876
Smelting, refining and royalty expenses
('000)
823
1,757
Less by-product credits ('000)
(1,661)
(4,364)
Cash costs ('000)
$8,444
$7,269
Divided by silver produced (oz)
311,096
390,927
Cash costs/Ag oz produced ($/oz)
$27.14
$18.59
Reconciliation of Consolidated All-In
Sustaining Costs/Ag Oz Produced (a)
Q1-2024
Q1-2023
Cash costs ('000)
$9,895
$5,584
Capital expenditures ('000)
3,531
2,419
Exploration costs ('000)
646
427
All-in sustaining costs ('000)
$14,072
$8,430
Divided by silver produced (oz)
481,936
499,677
All-in sustaining costs/Ag oz produced
($/oz)
$29.20
$16.87
Reconciliation of Cosalá Operations
All-In Sustaining Costs/Ag Oz Produced
Q1-2024
Q1-2023
Cash costs ('000)
$4,828
$1,223
Capital expenditures ('000)
1,474
1,183
Exploration costs ('000)
123
119
All-in sustaining costs ('000)
$6,425
$2,525
Divided by silver produced (oz)
295,278
265,121
All-in sustaining costs/Ag oz produced
($/oz)
$21.76
$9.52
Reconciliation of Galena Complex All-In
Sustaining Costs/Ag Oz Produced
2023
Q1-2023
Cash costs ('000)
$8,444
$7,269
Capital expenditures ('000)
3,428
2,060
Exploration costs ('000)
871
514
All-in sustaining costs ('000)
$12,743
$9,843
Galena Complex Recapitalization Plan costs
('000)
-
2,565
All-in sustaining costs with Galena
Recapitalization Plan ('000)
$12,743
$12,408
Divided by silver produced (oz)
311,096
390,927
All-in sustaining costs/Ag oz produced
($/oz)
$40.96
$25.18
All-in sustaining costs with Galena
Recapitalization/Ag oz produced ($/oz)
$40.96
$31.74
(a) Throughout this press release, consolidated production
results and consolidated operating metrics are based on the
attributable ownership percentage of each operating segment (100%
Cosalá Operations and 60% Galena Complex).
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240515504740/en/
Stefan Axell VP, Corporate Development & Communications
Americas Gold and Silver Corporation 416-874-1708 Darren Blasutti
President and CEO Americas Gold and Silver Corporation
416‐848‐9503
Americas Gold and Silver (AMEX:USAS)
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