Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) (“Fortuna”
or the “Company”) today reported its financial and
operating results for the third quarter of 2023.
Third Quarter 2023
highlights
Financial
- Net income4 of $27.5 million or
$0.09 per share, compared to $3.1 million or $0.01 per share in Q2
2023
- Adjusted net income4,1 of $29.6
million or $0.10 per share, compared to $2.5 million or $0.01 per
share in Q2 2023
- Adjusted EBITDA1 of $104.6 million,
compared to $44.4 million in Q2 2023
- Net cash provided by operating
activities of $106.5 million and free cash flow from ongoing
operations1 of $70.0 million, compared to $44.2 million and $9.5
million, respectively, in Q2 2023
- Company paid down $40.0 million of
its revolving credit facility. At the close of the quarter total
net debt was $133.4 million and the total net debt to adjusted
EBITDA ratio1 was 0.5
- Liquidity as of September 30, 2023
was $162.3 million5, compared to $97.9 million at the end of Q2
2023
Operational
- Gold production of 94,821 ounces,
compared to 64,348 ounces in Q2 2023
- Silver production of 1,680,751
ounces, compared to 1,262,561 ounces in Q2 2023
- Gold equivalent6 production of
128,671 ounces, compared to 93,454 ounces in Q2 2023
- Consolidated cash costs1 per ounce
of gold equivalent sold of $814, compared to $968 in Q2 2023
- Consolidated all-in sustaining
costs (AISC)1 per ounce of gold equivalent sold of $1,312, compared
to $1,799 in Q2 2023
- Year to date Lost Time Injury
Frequency Rate (LTIFR) of 0.38 and Total Recordable Injury
Frequency Rate (TRIFR) of 0.86.
Growth and Development
- The third quarter was the first
full reporting period for the Séguéla Mine
- The acquisition of Chesser
Resources Limited and its Diamba Sud project was completed on
September 20, 2023 (Refer to the News Release dated September 20,
2023).
Jorge A. Ganoza, President and CEO, commented,
“Fortuna has delivered record production and financial results for
all its key metrics driven by the first full quarter contribution
of our flagship Séguéla gold mine.” Mr. Ganoza continued, “Compared
to the first half of the year, the reduction in our consolidated
all-in sustaining cost to $1,312 is primarily the result of
Séguéla’s industry leading AISC of $788 per ounce, abating
inflation, optimization initiatives across the business, and higher
gold production at the Yaramoko mine driven by new high grade
zones.” Mr. Ganoza concluded, “As we shift from a two-year
capital-intensive phase to strong free cash flow generation, we
will prioritize strengthening our balance sheet through debt
reduction and advancing high value opportunities in our exploration
portfolio. We currently maintain eleven drill rigs turning across
our properties including three at our newly acquired Diamba Sud
gold project in Senegal.”
_______________________4 Attributable to Fortuna
Shareholders5 Excluding letters of credit6 Au Eq includes gold,
silver, lead and zinc and is calculated using the following metal
prices: $1,924/oz Au, $23.70/oz Ag, $2,136/t Pb and $2,428/t
Zn or Au:Ag = 1:81.19, Au:Pb = 1:0.90, Au:Zn = 0.79 for Q3
2023, and the following metal prices: $1,975/oz Au, $24.10/oz Ag,
$0.96/t Pb and $1.23/t Zn or Au:Ag = 1:81.96, Au:Pb =
1:0.93, Au:Zn = 1:0.73 for Q2 2023.
Third Quarter 2023 Consolidated Results
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Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in millions) |
|
2023 |
|
2022 |
|
|
% Change |
|
2023 |
|
2022 |
|
% Change |
|
Sales |
|
243.1 |
|
166.6 |
|
|
46 |
% |
|
577.1 |
|
516.8 |
|
12 |
% |
| Mine operating income |
|
65.9 |
|
24.7 |
|
|
167 |
% |
|
138.2 |
|
120.8 |
|
14 |
% |
| Operating income |
|
45.4 |
|
5.7 |
|
|
696 |
% |
|
77.0 |
|
59.6 |
|
29 |
% |
| Attributable net income
(loss) |
|
27.5 |
|
(3.7 |
) |
|
843 |
% |
|
41.5 |
|
24.6 |
|
69 |
% |
| Attributable Earnings per
share - basic |
|
0.09 |
|
(0.01 |
) |
|
1,000 |
% |
|
0.14 |
|
0.08 |
|
75 |
% |
| Attributable Adjusted net
income1 |
|
29.6 |
|
2.9 |
|
|
921 |
% |
|
44.3 |
|
35.0 |
|
27 |
% |
| Adjusted EBITDA1 |
|
104.6 |
|
54.4 |
|
|
92 |
% |
|
214.0 |
|
189.7 |
|
13 |
% |
| Net cash provided by operating
activities |
|
106.5 |
|
64.7 |
|
|
65 |
% |
|
191.8 |
|
144.6 |
|
33 |
% |
| Free cash flow from ongoing
operations1 |
|
70.0 |
|
34.0 |
|
|
106 |
% |
|
87.3 |
|
64.8 |
|
35 |
% |
| Production cash cost ($/oz Au
Eq) |
|
814 |
|
881 |
|
|
(8 |
%) |
|
887 |
|
841 |
|
5 |
% |
| All-in sustaining cash cost
($/oz Au Eq) |
|
1,312 |
|
1,431 |
|
|
(8 |
%) |
|
1,507 |
|
1,383 |
|
9 |
% |
| Capital expenditures2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining |
|
27.2 |
|
23.2 |
|
|
17 |
% |
|
89.3 |
|
64.3 |
|
39 |
% |
|
Non-sustaining3 |
|
1.3 |
|
4.0 |
|
|
(68 |
%) |
|
3.4 |
|
10.4 |
|
(67 |
%) |
|
Séguéla construction |
|
1.9 |
|
23.5 |
|
|
(92 |
%) |
|
50.0 |
|
87.6 |
|
(43 |
%) |
|
Brownfields |
|
3.3 |
|
9.6 |
|
|
(66 |
%) |
|
10.7 |
|
17.1 |
|
(37 |
%) |
| As at |
|
|
|
|
|
|
|
September 30, 2023 |
|
December 31, 2022 |
|
% Change |
| Cash and cash
equivalents |
|
|
|
117.8 |
|
80.5 |
|
46 |
% |
| Net
liquidity position (excluding letters of credit) |
|
|
|
|
|
|
|
162.3 |
|
150.5 |
|
8 |
% |
| 1 Refer to Non-IFRS
Financial Measures section at the end of this news release and to
the MD&A accompanying the Company’s financial statements filed
on SEDAR+ at www.sedarplus.ca for a description of the calculation
of these measures. |
| 2 Capital
expenditures are presented on a cash basis |
|
| 3 Non-sustaining
expenditures include greenfields exploration |
|
| Figures may not add
due to rounding |
|
| |
|
Third Quarter 2023 Results
Net income attributable to Fortuna for the
quarter was $27.5 million compared to an attributable net loss of
$3.7 million in Q3 2022. After adjusting for non-cash and
non-recurring items, adjusted attributable net income for the
quarter was $29.6 million compared to $2.9 million in Q3 2022. The
increase in net income and adjusted net income is explained mainly
by increased gold sales volume, higher realized gold and silver
prices and lower cost of sales per gold equivalent ounce. Higher
gold sales volume was primarily due to the contribution from the
first quarter of commercial production at Séguéla and higher grades
at Yaramoko. This was partially offset by lower gold sales volume
at Lindero related to lower grades, in line with the mine plan. The
realized gold and silver prices were $1,925 and $23.7 per ounce,
respectively, in Q3 2023 compared to $1,718 and $19.2 per ounce,
respectively, in the prior year. The lower cash cost of sales per
gold equivalent ounce was mainly due to the contribution of
low-cost production from Séguéla and lower cost of sales per ounce
of gold at Yaramoko related to higher grades. This was partially
offset by higher costs of sales per ounce at Lindero and San Jose.
Other items impacting net income in the quarter were higher
interest expenses of $5.7 million as a result of interest costs no
longer being capitalized in the quarter, higher outstanding debt
and increased interest rates; lower depletion at Séguéla which is
expected to increase in the coming quarters from depletion of the
purchase price; and a low effective income tax rate in the quarter
of 17.6% as no income taxes were recorded at Séguéla.
General and administrative expenses for the
quarter of $14.6 million were higher than the same period in 2022
as Séguéla transitioned to operations and costs are no longer being
capitalized. G&A is comprised of the following items:
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Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in millions) |
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
|
Mine G&A |
|
8.4 |
|
5.4 |
|
56 |
% |
|
20.5 |
|
15.8 |
|
30 |
% |
| Corporate G&A |
|
5.5 |
|
5.4 |
|
2 |
% |
|
19.7 |
|
22.3 |
|
(12 |
%) |
| Share-based payments |
|
0.5 |
|
1.9 |
|
(74 |
%) |
|
3.8 |
|
5.9 |
|
(36 |
%) |
|
Workers' participation |
|
0.2 |
|
0.3 |
|
(33 |
%) |
|
0.2 |
|
0.7 |
|
(71 |
%) |
|
Total |
|
14.6 |
|
13.0 |
|
12 |
% |
|
44.2 |
|
44.7 |
|
(1 |
%) |
Net cash generated by operations for the quarter
increased $41.6 to $106.5 million. The increase reflects higher
EBITDA of $51.2 million offset by lower changes in working capital
in Q3 2023 of $0.2 million compared to a change in Q3 2022 of $11.5
million. Income tax paid in the quarter of $3.2 million was $5.6
million lower than in Q3 2022 as no income tax was paid at Séguéla
in Q3 2023. It is expected Séguéla will start incurring current
income taxes in Q4 2023 and paying income taxes in 2024.
In the third quarter of 2023 capital
expenditures on a cash basis was $37.0 million consisting primarily
of $30.6 million in sustaining capital, including brownfields
exploration, and $4.0 million of non-sustaining exploration.
Free cash flow from ongoing operations for the
quarter was $70.0 million, compared to $34.0 million in Q3 2022.
The increase of $36.0 million is the result of higher net cash
generated by operations of $41.8 million partially offset by higher
sustaining capex and brownfields exploration at our operating mines
of $5.8 million in Q3 2023.
Consolidated All-in Sustaining
Cost
Consolidated AISC per gold equivalent ounce
(GEO) sold for the third quarter of 2023 was $1,312 per ounce
compared to $1,431 per ounce for the comparable quarter in 2022.
The lower AISC was driven by a decrease of $67 in cash cost of
sales per gold equivalent ounce to $814 and lower capital costs per
ounce driven by higher volume.
Liquidity
The Company’s total liquidity available as of
September 30, 2023 was $162.3 million comprised of $117.8 million
in cash and cash equivalents, and $44.5 million undrawn on the
$250.0 million revolving credit facility (excluding letters of
credit).
Lindero Mine, Argentina
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Three months ended September 30, |
|
Nine months ended September 30, |
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|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Mine Production |
|
|
|
|
|
|
|
|
|
Tonnes placed on the leach pad |
|
1,467,578 |
|
1,365,726 |
|
4,449,049 |
|
4,163,555 |
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|
|
|
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| Gold |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
0.62 |
|
0.83 |
|
0.65 |
|
0.83 |
|
Production (oz) |
|
20,933 |
|
30,032 |
|
71,647 |
|
89,116 |
|
Metal sold (oz) |
|
22,242 |
|
30,064 |
|
74,194 |
|
89,229 |
|
Realized price ($/oz) |
|
1,910 |
|
1,719 |
|
1,923 |
|
1,825 |
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|
|
|
|
|
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|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
Cash cost ($/oz Au)1 |
|
988 |
|
772 |
|
916 |
|
717 |
|
All-in sustaining cash cost ($/oz Au)1 |
|
1,611 |
|
1,159 |
|
1,569 |
|
1,117 |
|
|
|
|
|
|
|
|
|
|
| Capital Expenditures ($000's)
2 |
|
|
|
|
|
|
|
|
|
Sustaining |
|
7,669 |
|
4,814 |
|
28,751 |
|
14,062 |
|
Non-sustaining |
|
353 |
|
– |
|
676 |
|
169 |
|
Brownfields |
|
– |
|
314 |
|
– |
|
1,104 |
1 Cash cost and All-in sustaining cash cost are non-IFRS
financial measures; refer to non-IFRS financial measures section at
the end of this news release and to the MD&A accompanying the
Company’s financial statements filed on SEDAR+ at www.sedarplus.ca
for a description of the calculation of these measures.
2 Capital expenditures are presented on a cash
basis.
Quarterly Operating and Financial Highlights
In the third quarter of 2023, a total of
1,467,578 tonnes of ore were placed on the heap leach pad, with an
average gold grade of 0.62 g/t, containing an estimated 29,068
ounces of gold. Gold production for Q3 2023 totaled 20,933 ounces.
This represents a 30% decrease in total ounces to the comparable
quarter of 2022. This decline in gold production can be primarily
explained by the lower head grade of ore placed on the leach pad,
in accordance with the mining sequence and the Mineral Reserves.
Ore mined was 1.9 million tonnes, with a stripping ratio of 1.1:1.
The stripping ratio in the third quarter is 59 percent lower than
the second quarter and is expected to continue declining through to
the end of the year.
Higher stripping of waste in the first nine
months of the year will allow improved access to higher grade
material scheduled in the mine plan for the fourth quarter. As a
result, Lindero anticipates placing approximately 1.6 million
tonnes of ore on the leach pad in Q4 2023 at a higher average grade
of 0.67 g/t Au.
Cash cost per ounce of gold for the quarter
ended September 30, 2023, was $988 compared to $772 in the same
period in 2022. Cash cost per ounce of gold was higher due to lower
head grades in line with the mine plan, partially offset by lower
processing costs.
All-in sustaining cash cost per gold ounce sold
was $1,611 during Q3 2023 compared with $1,159 in the same period
of 2022. All-in sustaining cash cost for the third quarter of 2023
was impacted by lower production described above and higher
sustaining capital expenditures.
During the quarter, increased sustaining capital
expenditures were primarily driven by the development of Phase 2 of
the leach pad and capitalized stripping. As of September 30, 2023,
the leach pad expansion project (Project) is approximately 13
percent complete. The procurement construction and management (PCM)
service has been awarded to Knight Piésold, the accommodation camp
expansion and PCM offices for the Project have been finalized, and
PCM personnel are already onsite. Mobilization of the contractor’s
personnel and equipment has commenced. The first shipments of
geomembrane and geosynthetic clay liner are in transit, and the
Project remains on schedule for completion during the second half
of 2024.
Yaramoko Mine Complex, Burkina Faso
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| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Mine Production |
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
137,281 |
|
137,202 |
|
421,133 |
|
403,957 |
| |
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
7.72 |
|
6.21 |
|
6.52 |
|
6.34 |
|
Recovery (%) |
|
99 |
|
97 |
|
98 |
|
97 |
|
Production (oz) |
|
34,036 |
|
27,130 |
|
89,476 |
|
79,918 |
|
Metal sold (oz) |
|
33,971 |
|
27,055 |
|
89,448 |
|
81,183 |
|
Realized price ($/oz) |
|
1,932 |
|
1,716 |
|
1,932 |
|
1,821 |
| |
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
Cash cost ($/oz Au)1 |
|
752 |
|
934 |
|
764 |
|
847 |
|
All-in sustaining cash cost ($/oz Au)1 |
|
1,211 |
|
1,630 |
|
1,429 |
|
1,433 |
|
|
|
|
|
|
|
|
|
|
| Capital Expenditures ($000's)
2 |
|
|
|
|
|
|
|
|
|
Sustaining |
|
9,451 |
|
10,225 |
|
37,318 |
|
26,671 |
|
Brownfields |
|
1,447 |
|
2,530 |
|
3,656 |
|
3,018 |
1 Cash cost and All-in sustaining cash cost are
non-IFRS financial measures; refer to non-IFRS financial measures
section at the end of this news release and to the MD&A
accompanying the Company’s financial statements filed on SEDAR+ at
www.sedarplus.ca for a description of the calculation of these
measures.2 Capital expenditures are presented on a cash basis.
The Yaramoko Mine produced 34,036 ounces of gold
in the third quarter of 2023 with an average gold head grade of
7.72g/t, 25% and 24% increases when compared to the same period in
2022. Increased production resulted from higher average grades and
greater widths of mineralization encountered in development
headings, which contributed 42% of total mill feed.
As a result of the aforementioned higher grades
in development and production zones within the mine plan, the
Company has revised Yaramoko’s annual gold production guidance
upwards to 110 to 120 thousand ounces from the original guidance of
92 to 102 thousand ounces, an increase of approximately 14 percent.
Gold production for the first nine months of 2023 totaled 89,476
ounces.
Cash cost per ounce of gold sold for the quarter
ended September 30, 2023, was $752 compared to $934 in the same
period in 2022. Cash cost per ounce decreased due to higher
production, improved head grades of ore processed, reduced mining
costs related to ore development and decreased transportation
costs.
All-in sustaining cash cost per gold ounce sold
was $1,211 for Q3 2023, compared to $1,630 for the same period in
2022. This decrease was as a result of higher production, and cash
cost savings described above.
Sustaining capital for Q3 2023 was higher due to
more intensive mine development. Brownfields expenditure was
primarily related to diamond drilling. Drilling focused on infill
grade control and exploring for extensions beyond the mineralized
resource envelope in the deeper eastern portion of Zone 55. During
the fourth quarter, drilling will continue on the western portion
of Zone 55, testing for up and down-dip continuity of the recently
discovered extensions to the resource boundary.
Séguéla Mine, Côte d’Ivoire
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| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Mine Production |
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
310,387 |
|
- |
|
419,992 |
|
- |
| |
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
3.83 |
|
- |
|
3.28 |
|
- |
|
Recovery (%) |
|
93 |
|
- |
|
94 |
|
- |
|
Production (oz) |
|
31,498 |
|
- |
|
35,521 |
|
- |
|
Metal sold (oz) |
|
35,503 |
|
— |
|
35,503 |
|
— |
|
Realized price ($/oz) |
|
1,927 |
|
— |
|
1,927 |
|
— |
| |
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
Cash cost ($/oz Au)1 |
|
397 |
|
- |
|
397 |
|
- |
|
All-in sustaining cash cost ($/oz Au)1 |
|
788 |
|
- |
|
788 |
|
- |
|
|
|
|
|
|
|
|
|
|
| Capital Expenditures ($000's)
2 |
|
|
|
|
|
|
|
|
|
Sustaining |
|
3,147 |
|
– |
|
3,147 |
|
– |
|
Brownfields |
|
– |
|
– |
|
– |
|
– |
| |
| 1 Cash cost and
All-in sustaining cash cost are non-IFRS financial measures. Refer
to Non-IFRS Financial Measures. |
| 2 Capital
expenditures are presented on a cash basis |
| |
From Séguéla’s first gold pour on May 24th to
the successful completion of the processing plant performance test
in August, the operation is now exceeding nameplate capacity.
Séguéla is well positioned to achieve the mid-point of its gold
production guidance of 60 to 75 thousand ounces for the second half
of 2023.
In the third quarter of 2023, mine production
totaled 502,326 tonnes of ore, averaging 3.48 g/t Au, and
containing an estimated 56,136 ounces of gold from the Antenna Pit.
Movement of waste during the quarter totaled 1,156,540 tonnes, for
a strip ratio of 2.3:1.
Cash cost per gold ounce sold was $397 for Q3
2023, which was below plan, primarily higher due to head grades and
lower energy and diesel consumption.
All-in sustaining cash cost per gold ounce sold
was $788 for Q3 2023, which was below plan, primarily due to lower
cash cost, lower capital expenditures, and higher sale volume.
Sustaining capital for Q3 2023 consisted
primarily of mine development. The first stage of grade control
drilling was completed at the Ancien deposit during the third
quarter, with results currently being processed. Construction of
the access road continued as planned, with stripping and initial
mining of oxide material scheduled to begin this quarter.
At the Koula deposit, initial grade control
drilling started and should be completed early this quarter.
San Jose Mine, Mexico
|
|
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|
|
|
|
|
|
|
| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Mine Production |
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
247,542 |
|
267,198 |
|
689,165 |
|
770,090 |
|
Average tonnes milled per day |
|
2,845 |
|
3,071 |
|
2,790 |
|
2,939 |
| |
|
|
|
|
|
|
|
|
| Silver |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
189 |
|
196 |
|
180 |
|
189 |
|
Recovery (%) |
|
91 |
|
92 |
|
91 |
|
91 |
|
Production (oz) |
|
1,372,530 |
|
1,545,410 |
|
3,633,107 |
|
4,288,936 |
|
Metal sold (oz) |
|
1,347,719 |
|
1,539,382 |
|
3,618,723 |
|
4,272,878 |
|
Realized price ($/oz) |
|
23.65 |
|
19.14 |
|
23.37 |
|
21.86 |
| |
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
1.14 |
|
1.16 |
|
1.11 |
|
1.14 |
|
Recovery (%) |
|
91 |
|
91 |
|
90 |
|
91 |
|
Production (oz) |
|
8,205 |
|
9,091 |
|
22,215 |
|
25,624 |
|
Metal sold (oz) |
|
8,068 |
|
9,064 |
|
22,118 |
|
25,580 |
|
Realized price ($/oz) |
|
1,932 |
|
1,722 |
|
1,930 |
|
1,825 |
| |
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
Production cash cost ($/t)2 |
|
103.47 |
|
79.37 |
|
97.26 |
|
79.66 |
|
Production cash cost ($/oz Ag Eq)1,2 |
|
13.84 |
|
9.70 |
|
13.48 |
|
10.35 |
|
All-in sustaining cash cost ($/oz Ag Eq)1,2 |
|
18.04 |
|
14.23 |
|
18.65 |
|
14.95 |
|
|
|
|
|
|
|
|
|
|
| Capital Expenditures ($000's)
3 |
|
|
|
|
|
|
|
|
|
Sustaining |
|
3,462 |
|
4,410 |
|
10,828 |
|
12,036 |
|
Non-sustaining |
|
385 |
|
– |
|
1,178 |
|
869 |
|
Brownfields |
|
1,082 |
|
1,548 |
|
2,958 |
|
4,645 |
1 Production cash cost per ounce of silver equivalent and All-in
sustaining cash cost per ounce of silver equivalent are calculated
using realized metal prices for each period respectively.
2 Production cash cost per tonne, production
cash cost per ounce of silver equivalent, and all-in sustaining
cash cost per ounce of silver equivalent are non-IFRS financial
measures, refer to non-IFRS financial measures section at the end
of this news release and to the MD&A accompanying the Company’s
financial statements filed on SEDAR+ at www.sedarplus.ca for a
description of the calculation of these measures.3 Capital
expenditures are presented on a cash basis
In the third quarter of 2023, the San Jose Mine
produced 1,372,530 ounces of silver at an average head grade of 189
g/t Ag and 8,205 ounces of gold at an average head grade of 1.14
g/t Au, 11% and 10% lower, respectively, when compared to the same
period in 2022. The decrease in silver and gold production for the
third quarter of 2023, when compared to the third quarter of 2022,
is explained by the declining grade profile of Mineral Reserves in
the mine plan. The processing plant milled 247,542 tonnes at an
average of 2,845 tonnes per day during the third quarter, in line
with the plan for the period.
Gold production is expected to fall slightly
below the annual guidance range of 34 to 37 thousand ounces,
resulting from lost production days in the second quarter due to
the illegal union blockade, and gold head grade reconciliation to
reserves in the low end of range. The San Jose Mine remains
positioned to deliver annual silver production within the guidance
range of between 5.3 to 5.8 million ounces.
The cash cost per tonne for the three months
ended September 30, 2023, was $103.47 compared to $79.37 in the
same period in 2022. The increase was primarily due to higher use
of contractors to make up for lost production in the second quarter
of 2023 related to the illegal blockade, higher maintenance and
indirect costs and the appreciation of the Mexican Peso.
All-in sustaining cash cost of payable silver
equivalent for the three months ended September 30, 2023, increased
26% to $18.04 per ounce, compared to $14.23 per ounce for the same
period in 2022. The increase was driven by higher cash cost, lower
production, and lower equivalent silver ounces per gold ounce. This
was offset slightly by lower capital expenditures and lower
workers’ participation costs.
In the third quarter of 2023, sustaining capital
expenditures were higher than the same period in 2022. This
increase was primarily due to the execution of development meters,
which had been postponed from Q2 2023 because of the blockade.
Brownfields expenditures were in line with the plan. Expenditures
are however expected to increase, due to the emergent drilling
campaign at the Yessi vein.
Infill drilling at the San Jose Mine during the
quarter led to the discovery of the Yessi vein, a blind structure,
located 200 horizontal meters from existing underground
infrastructure. The discovery hole SJOM-1387 intersected 1,299 g/t
Ag Eq over 9.9 meters, and drill hole SJOM-1391 intersected 621 g/t
Ag Eq over 5 meters (Refer to the News Release filled on SEDAR+ on
September 5, 2023 titled “Fortuna intersects 1,299 g/t Ag Eq over a
true width of 9.9 meters at the San Jose Mine, Mexico” for full
details of the drilling program). Additional drilling is currently
underway from both surface and underground to define the extent and
geometry of this discovery. Mineralization remains open along
strike to the north and south, and at depth.
Caylloma Mine, Peru
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Mine Production |
|
|
|
|
|
|
|
|
|
Tonnes milled |
|
140,077 |
|
139,143 |
|
403,076 |
|
407,695 |
|
Average tonnes milled per day |
|
1,556 |
|
1,546 |
|
1,515 |
|
1,533 |
| |
|
|
|
|
|
|
|
|
| Silver |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
83 |
|
79 |
|
84 |
|
82 |
|
Recovery (%) |
|
82 |
|
82 |
|
82 |
|
81 |
|
Production (oz) |
|
308,221 |
|
292,096 |
|
896,583 |
|
871,593 |
|
Metal sold (oz) |
|
275,708 |
|
293,159 |
|
875,365 |
|
866,511 |
|
Realized price ($/oz) |
|
23.93 |
|
19.31 |
|
23.50 |
|
21.98 |
| |
|
|
|
|
|
|
|
|
| Gold |
|
|
|
|
|
|
|
|
|
Grade (g/t) |
|
0.13 |
|
0.11 |
|
0.13 |
|
0.14 |
|
Recovery (%) |
|
24 |
|
19 |
|
24 |
|
35 |
|
Production (oz) |
|
149 |
|
91 |
|
404 |
|
656 |
|
Metal sold (oz) |
|
18 |
|
— |
|
40 |
|
603 |
|
Realized price ($/oz) |
|
1,921 |
|
— |
|
1,902 |
|
1,864 |
| |
|
|
|
|
|
|
|
|
| Lead |
|
|
|
|
|
|
|
|
|
Grade (%) |
|
3.66 |
|
3.33 |
|
3.66 |
|
3.29 |
|
Recovery (%) |
|
92 |
|
89 |
|
92 |
|
88 |
|
Production (000's lbs) |
|
10,337 |
|
9,085 |
|
30,053 |
|
25,856 |
|
Metal sold (000's lbs) |
|
9,232 |
|
9,155 |
|
29,433 |
|
25,751 |
|
Realized price ($/lb) |
|
0.97 |
|
0.90 |
|
0.98 |
|
0.99 |
| |
|
|
|
|
|
|
|
|
| Zinc |
|
|
|
|
|
|
|
|
|
Grade (%) |
|
5.07 |
|
4.37 |
|
5.07 |
|
4.22 |
|
Recovery (%) |
|
90 |
|
89 |
|
90 |
|
89 |
|
Production (000's lbs) |
|
14,037 |
|
11,885 |
|
41,125 |
|
33,598 |
|
Metal sold (000's lbs) |
|
13,959 |
|
12,277 |
|
41,759 |
|
33,743 |
|
Realized price ($/lb) |
|
1.10 |
|
1.48 |
|
1.26 |
|
1.65 |
| |
|
|
|
|
|
|
|
|
| Unit Costs |
|
|
|
|
|
|
|
|
|
Production cash cost ($/t)2 |
|
99.25 |
|
93.12 |
|
100.29 |
|
92.03 |
|
Production cash cost ($/oz Ag Eq)1,2 |
|
15.62 |
|
11.32 |
|
14.50 |
|
12.25 |
|
All-in sustaining cash cost ($/oz Ag Eq)1,2 |
|
21.14 |
|
15.66 |
|
19.03 |
|
17.16 |
|
|
|
|
|
|
|
|
|
|
| Capital Expenditures ($000's)
3 |
|
|
|
|
|
|
|
|
|
Sustaining |
|
3,514 |
|
3,764 |
|
9,267 |
|
11,506 |
|
Brownfields |
|
797 |
|
198 |
|
1,337 |
|
729 |
1 Production cash cost per ounce of silver equivalent and All-in
sustaining cash cost per ounce of silver equivalent are calculated
using realized metal prices for each period respectively.
2 Production cash cost per tonne, production
cash cost per ounce of silver equivalent, and all-in sustaining
cash cost per ounce of silver equivalent are non-IFRS financial
measures, refer to non-IFRS financial measures section at the end
of this news release and to the MD&A accompanying the Company’s
financial statements filed on SEDAR+ at www.sedarplus.ca for a
description of the calculation of these measures.3 Capital
expenditures are presented on a cash basis.
The Caylloma Mine produced 308,221 ounces of
silver, 10.3 million pounds of lead, and 14.0 million pounds of
zinc during the third quarter of 2023. Silver production was 6%
higher compared to the same quarter in 2022. Lead and zinc
production rose by 14% and 18% respectively, compared to the same
period in 2022. Increased production was the result of positive
grade reconciliation to the reserve model in levels 16 and 18 of
the Animas vein. Increased recoveries for lead and zinc were also
driven by the higher grades. Gold production totaled 149 ounces
with an average head grade of 0.13 g/t.
The cash cost per tonne of processed ore for the
three months ended September 30, 2023, increased 7% to $99.25
compared to $93.12 in the same period in 2022. This increase was
primarily due to higher processing and indirect costs.
The all-in sustaining cash cost per ounce of
payable silver equivalent for the three months ended September 30,
2023, increased 35% to $21.14, compared to $15.66 for the same
period in 2022. The increase was driven by higher cash cost and the
impact of metal prices on the calculation of silver equivalent
ounces.
Capital costs for the period mainly consisted of underground
development in mine levels 15, 16, and 18. The increase in
Brownfields expenditures is primarily attributable to additional
long hole drilling.
Qualified Person
Eric Chapman, Senior Vice President of Technical
Services, is a Professional Geoscientist of the Engineers and
Geoscientists of British Columbia (Registration Number 36328), and
is the Company’s Qualified Person (as defined by National
Instrument 43-101). Mr. Chapman has reviewed and approved the
scientific and technical information contained in this news release
and has verified the underlying data.
Non-IFRS Financial Measures
The Company has disclosed certain financial
measures and ratios in this news release which are not defined
under the International Financial Reporting Standards (“IFRS”), as
issued by the International Accounting Standards Board, and are not
disclosed in the Company's financial statements, including but not
limited to: cash cost per ounce of gold sold; all-in sustaining
cash cost per ounce of gold sold; all-in sustaining cash cost per
ounce of gold equivalent sold; all-in cash cost per ounce of gold
sold; production cash cost per ounce of gold equivalent; total
production cash cost per tonne; cash cost per payable ounce of
silver equivalent sold; all-in sustaining cash cost per payable
ounce of silver equivalent sold; all-in cash cost per payable ounce
of silver equivalent sold; free cash flow from ongoing operations;
adjusted net income; adjusted EBITDA and working capital.
These non-IFRS financial measures and non-IFRS
ratios are widely reported in the mining industry as benchmarks for
performance and are used by management to monitor and evaluate the
Company's operating performance and ability to generate cash. The
Company believes that, in addition to financial measures and ratios
prepared in accordance with IFRS, certain investors use these
non-IFRS financial measures and ratios to evaluate the Company’s
performance. However, the measures do not have a standardized
meaning under IFRS and may not be comparable to similar financial
measures disclosed by other companies. Accordingly, non-IFRS
financial measures and non-IFRS ratios should not be considered in
isolation or as a substitute for measures and ratios of the
Company’s performance prepared in accordance with IFRS. The Company
has calculated these measures consistently for all periods
presented.
To facilitate a better understanding of these
measures and ratios as calculated by the Company, descriptions are
provided below. In addition see “Non-IFRS Financial Measures” in
the Company’s management’s discussion and analysis for the three
and nine months ended September 30, 2023 (“Q3 2023 MDA”), which
section is incorporated by reference in this news release, for
additional information regarding each non-IFRS financial measure
and non-IFRS ratio disclosed in this news release, including an
explanation of their composition; an explanation of how such
measures and ratios provide useful information to an investor and
the additional purposes, if any, for which management of the
Company uses such measures and ratio. The Q3 2023 MD&A may be
accessed on SEDAR+ at www.sedarplus.ca under the Company’s
profile.
Except as otherwise described in the Q3 2023
MD&A, the Company has calculated these measures consistently
for all periods presented.
Reconciliation to Total Net debt and Net debt to
Adjusted EBITDA ratio for September 30, 2023
| |
|
|
(Expressed in millions except Total net debt to Adjusted EBITDA
ratio) |
As at September 30, 2023 |
|
Credit facility |
$ |
205.5 |
|
|
Convertible debenture |
|
45.7 |
|
| Debt |
|
251.2 |
|
| Less:
Cash and Cash Equivalents |
|
(117.8 |
) |
| Total net debt1 |
$ |
133.4 |
|
|
Adjusted EBITDA (last four quarters) |
$ |
270.1 |
|
| Total
net debt to adjusted EBITDA ratio |
|
0.5:1 |
|
| 1 Excluding letters of
credit |
|
|
Reconciliation to adjusted attributable
net income for the three and nine months ended September 30, 2023
and 2022
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in millions) |
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
Net income (loss) attributable to shareholders |
|
27.5 |
|
|
(3.8 |
) |
|
41.5 |
|
|
24.6 |
|
| Adjustments, net of tax: |
|
|
|
|
|
|
|
|
| Community support provision
and accruals1 |
|
- |
|
|
- |
|
|
(0.1 |
) |
|
- |
|
| Foreign exchange loss, Séguéla
Mine |
|
0.1 |
|
|
0.3 |
|
|
- |
|
|
1.1 |
|
| Write off of mineral
properties |
|
0.5 |
|
|
3.4 |
|
|
0.5 |
|
|
4.9 |
|
| Unrealized loss (gain) on
derivatives |
|
(0.1 |
) |
|
1.7 |
|
|
(0.3 |
) |
|
(0.5 |
) |
| Inventory adjustment |
|
- |
|
|
0.8 |
|
|
0.7 |
|
|
3.8 |
|
| Accretion on right of use
assets |
|
1.5 |
|
|
0.5 |
|
|
2.6 |
|
|
1.7 |
|
| Other
non-cash/non-recurring items |
|
0.1 |
|
|
- |
|
|
(0.6 |
) |
|
(0.6 |
) |
|
Adjusted attributable net income |
|
29.6 |
|
|
2.9 |
|
|
44.3 |
|
|
35.0 |
|
| 1 Amounts are recorded in Cost
of sales |
|
|
|
|
|
|
|
|
Reconciliation to adjusted attributable
net income for the three months ended June 30, 2023
| |
|
|
| |
|
June 30 |
|
(Expressed in millions) |
2023 |
|
|
Net income (loss) attributable to shareholders |
|
3.1 |
|
| Adjustments, net of tax: |
|
|
| Foreign exchange loss, Séguéla
Mine |
|
(0.2 |
) |
| Unrealized loss (gain) on
derivatives |
|
(1.3 |
) |
| Inventory adjustment |
|
0.7 |
|
| Accretion on right of use
assets |
|
0.6 |
|
| Other
non-cash/non-recurring items |
|
(0.4 |
) |
|
Adjusted attributable net income |
|
2.5 |
|
| 1 Amounts are recorded in Cost
of sales |
|
|
| |
|
|
Reconciliation to adjusted EBITDA for
the three and nine months ended September 30, 2023 and
2022
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
Consolidated (in millions of US dollars) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Net income |
|
30.9 |
|
|
(4.1 |
) |
|
46.2 |
|
|
24.5 |
|
| Adjustments: |
|
|
|
|
|
|
|
|
|
Community support provision and accruals |
|
(0.1 |
) |
|
- |
|
|
(0.2 |
) |
|
- |
|
|
Inventory adjustment |
|
- |
|
|
1.1 |
|
|
0.9 |
|
|
5.1 |
|
|
Foreign exchange loss, Séguéla Mine |
|
0.1 |
|
|
0.3 |
|
|
- |
|
|
1.2 |
|
|
Net finance items |
|
8.2 |
|
|
2.4 |
|
|
14.3 |
|
|
8.9 |
|
|
Depreciation, depletion, and amortization |
|
63.9 |
|
|
46.9 |
|
|
148.0 |
|
|
127.4 |
|
|
Income taxes |
|
6.6 |
|
|
5.8 |
|
|
15.6 |
|
|
26.1 |
|
|
Other non-cash/non-recurring items |
|
(5.0 |
) |
|
2.0 |
|
|
(10.8 |
) |
|
(3.5 |
) |
|
Adjusted EBITDA |
|
104.6 |
|
|
54.4 |
|
|
214.0 |
|
|
189.7 |
|
Figures may not add due to rounding
Reconciliation of free cash flow from
ongoing operations for the three and nine months ended September
30, 2023 and 2022
In 2022, the Company changed the method for
calculating free cash flow from ongoing operations. The calculation
now uses taxes paid as opposed to the previous method which used
current income taxes. While this may create larger quarter over
quarter fluctuations due to the timing of income tax payments,
management believes the revised method is a better representation
of the free cash flow generated by the Company’s ongoing
operations.
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in millions) |
2023 |
|
2022 |
|
2023 |
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
106.5 |
|
|
64.7 |
|
|
191.8 |
|
|
144.6 |
|
| Adjustments |
|
|
|
|
|
|
|
|
|
Séguéla, working capital |
|
- |
|
|
- |
|
|
4.4 |
|
|
- |
|
|
Additions to mineral properties, plant and equipment |
|
(30.6 |
) |
|
(27.8 |
) |
|
(97.3 |
) |
|
(73.8 |
) |
|
Mexican royalty payment |
|
- |
|
|
- |
|
|
- |
|
|
3.0 |
|
|
Other adjustments |
|
(5.9 |
) |
|
(2.9 |
) |
|
(11.6 |
) |
|
(9.0 |
) |
| Free
cash flow from ongoing operations |
|
70.0 |
|
|
34.0 |
|
|
87.3 |
|
|
64.8 |
|
Figures may not add due to rounding
Reconciliation of cash cost per ounce of gold sold for
the three and nine months ended September 30, 2023 and
2022
| |
|
|
|
|
|
|
|
|
|
| Lindero
Mine |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Cost of sales |
|
|
36,778 |
|
|
43,928 |
|
|
118,783 |
|
|
121,122 |
|
| Changes in doré inventory |
|
|
(1,504 |
) |
|
(107 |
) |
|
(2,824 |
) |
|
605 |
|
| Inventory adjustment |
|
|
- |
|
|
- |
|
|
15 |
|
|
- |
|
| Export duties |
|
|
(3,266 |
) |
|
(3,900 |
) |
|
(11,042 |
) |
|
(12,192 |
) |
| Depletion and
depreciation |
|
|
(11,132 |
) |
|
(14,898 |
) |
|
(36,197 |
) |
|
(41,203 |
) |
| By
product credits |
|
|
(454 |
) |
|
(232 |
) |
|
(3,738 |
) |
|
(232 |
) |
| Production cash cost |
|
|
20,422 |
|
|
24,791 |
|
|
64,997 |
|
|
68,100 |
|
| Changes in doré inventory |
|
|
1,504 |
|
|
107 |
|
|
2,824 |
|
|
(605 |
) |
|
Realized gain in diesel hedge |
|
|
- |
|
|
(1,696 |
) |
|
- |
|
|
(3,515 |
) |
| Cash cost applicable per gold
ounce sold |
A |
|
21,926 |
|
|
23,202 |
|
|
67,821 |
|
|
63,980 |
|
| Ounces
of gold sold |
B |
|
22,195 |
|
|
30,052 |
|
|
74,038 |
|
|
89,193 |
|
| Cash
cost per ounce of gold sold ($/oz) |
=A/B |
|
988 |
|
|
772 |
|
|
916 |
|
|
717 |
|
| |
| |
|
|
|
|
|
|
|
|
|
| Yaramoko
Mine |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Cost of sales |
|
|
53,943 |
|
|
47,481 |
|
|
137,159 |
|
|
129,762 |
|
| Changes in doré inventory |
|
|
- |
|
|
- |
|
|
- |
|
|
(1,320 |
) |
| Inventory net realizable value
adjustment |
|
|
- |
|
|
(1,050 |
) |
|
(827 |
) |
|
(5,077 |
) |
| Royalties and mining
taxes |
|
|
(3,793 |
) |
|
(2,817 |
) |
|
(10,241 |
) |
|
(8,898 |
) |
| Depletion and
depreciation |
|
|
(24,563 |
) |
|
(18,356 |
) |
|
(57,719 |
) |
|
(47,010 |
) |
| Refining charges |
|
|
- |
|
|
- |
|
|
- |
|
|
(329 |
) |
| By
product credits |
|
|
- |
|
|
- |
|
|
- |
|
|
(25 |
) |
| Production cash cost |
|
|
25,587 |
|
|
25,258 |
|
|
68,372 |
|
|
67,103 |
|
| Changes in doré inventory |
|
|
- |
|
|
- |
|
|
- |
|
|
1,320 |
|
|
Refining charges |
|
|
- |
|
|
- |
|
|
- |
|
|
329 |
|
| Cash cost applicable per gold
ounce sold |
A |
|
25,587 |
|
|
25,258 |
|
|
68,372 |
|
|
68,752 |
|
| Ounces
of gold sold |
B |
|
34,029 |
|
|
27,055 |
|
|
89,447 |
|
|
81,183 |
|
| Cash
cost per ounce of gold sold ($/oz) |
=A/B |
|
752 |
|
|
934 |
|
|
764 |
|
|
847 |
|
| |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| Séguéla
Mine |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
2023 |
|
|
2022 |
| Cost of sales |
|
|
33,233 |
|
|
- |
|
33,233 |
|
|
- |
| Royalties and mining
taxes |
|
|
(4,568 |
) |
|
- |
|
(4,568 |
) |
|
- |
|
Depletion and depreciation |
|
|
(14,556 |
) |
|
- |
|
(14,556 |
) |
|
- |
| Production cash cost |
|
|
14,109 |
|
|
- |
|
14,109 |
|
|
- |
| Cash cost applicable per gold
ounce sold |
A |
|
14,109 |
|
|
- |
|
14,109 |
|
|
- |
| Ounces
of gold sold |
B |
|
35,503 |
|
|
- |
|
35,503 |
|
|
- |
| Cash
cost per ounce of gold sold ($/oz) |
=A/B |
|
397 |
|
|
- |
|
397 |
|
|
- |
| |
|
|
|
|
|
|
|
|
|
Reconciliation of cash cost per ounce of gold equivalent
sold for the three and nine months ended September 30, 2023 and
2022
| |
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Cost of sales |
|
|
177,181 |
|
|
141,860 |
|
|
438,944 |
|
|
396,016 |
|
| Changes in concentrate
inventory and dore inventory |
|
|
(1,387 |
) |
|
(180 |
) |
|
(2,770 |
) |
|
(840 |
) |
| Cost of sales-Right of
use |
|
|
651 |
|
|
- |
|
|
2,107 |
|
|
- |
|
| Depletion and depreciation in
concentrate inventory |
|
|
50 |
|
|
39 |
|
|
(40 |
) |
|
(147 |
) |
| Inventory adjustment |
|
|
789 |
|
|
(1,229 |
) |
|
(914 |
) |
|
(4,989 |
) |
| Royalties, export duties and
mining taxes |
|
|
(13,071 |
) |
|
(8,195 |
) |
|
(30,277 |
) |
|
(25,778 |
) |
| Provision for community
support |
|
|
109 |
|
|
123 |
|
|
32 |
|
|
98 |
|
| Workers' participation |
|
|
(789 |
) |
|
(1,433 |
) |
|
(1,417 |
) |
|
(3,264 |
) |
| Depletion and
depreciation |
|
|
(63,445 |
) |
|
(46,534 |
) |
|
(146,998 |
) |
|
(126,431 |
) |
| By
product credits |
|
|
(454 |
) |
|
(232 |
) |
|
(3,738 |
) |
|
(257 |
) |
| Production cash cost |
|
|
99,634 |
|
|
84,216 |
|
|
254,929 |
|
|
234,407 |
|
| Changes in concentrate
inventory and dore inventory |
|
|
1,387 |
|
|
180 |
|
|
2,770 |
|
|
840 |
|
| Cost of sales-Right of
use |
|
|
(651 |
) |
|
- |
|
|
(2,107 |
) |
|
- |
|
| Depletion and depreciation in
concentrate inventory |
|
|
(50 |
) |
|
(39 |
) |
|
40 |
|
|
147 |
|
| Inventory adjustment |
|
|
(789 |
) |
|
179 |
|
|
102 |
|
|
(87 |
) |
| Realized gain in diesel
hedge |
|
|
- |
|
|
(1,696 |
) |
|
- |
|
|
(3,515 |
) |
| Treatment charges |
|
|
4,768 |
|
|
2,855 |
|
|
15,191 |
|
|
10,967 |
|
|
Refining charges |
|
|
1,215 |
|
|
1,386 |
|
|
3,390 |
|
|
3,942 |
|
| Cash cost applicable per gold
equivalent ounce sold |
A |
|
105,514 |
|
|
87,083 |
|
|
274,315 |
|
|
246,701 |
|
| Ounces
of gold equivalent sold |
B |
|
129,627 |
|
|
98,872 |
|
|
309,196 |
|
|
293,423 |
|
| Cash
cost per ounce of gold equivalent sold ($/oz) |
=A/B |
|
814 |
|
|
881 |
|
|
887 |
|
|
841 |
|
| Gold equivalent
was calculated using the realized prices for gold of $1,924/oz Au,
$23.7/oz Ag, $2,136/t Pb, and $2,428/t Zn for Q3 2023 and using the
realized prices for gold of $1,718/oz Au, $19.2/oz Ag, $1,989/t Pb,
and $3,268/t Zn for Q3 2022. |
| Gold equivalent
was calculated using the realized prices for gold of $1,927/oz Au,
$23.4/oz Ag, $2,162/t Pb, and $2,778/t Zn for YTD 2023 and using
the realized prices for gold of $1,823/oz Au, $21.9/oz Ag, $2,181/t
Pb, and $3,634/t Zn for YTD 2022. |
| |
|
|
|
|
|
|
|
|
|
Reconciliation of all-in sustaining cash cost per ounce
of gold sold for the three and nine months ended September 30, 2023
and 2022
|
|
|
|
|
|
|
|
|
|
| Lindero
Mine |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Cash cost applicable |
|
21,926 |
|
23,202 |
|
67,821 |
|
63,980 |
| Export duties and mining
taxes |
|
3,266 |
|
3,900 |
|
11,042 |
|
12,192 |
| General
and administrative expenses (operations) |
|
2,292 |
|
2,044 |
|
6,791 |
|
6,497 |
| Adjusted operating cash
cost |
|
27,484 |
|
29,146 |
|
85,654 |
|
82,669 |
| Sustaining leases |
|
598 |
|
563 |
|
1,795 |
|
1,831 |
| Sustaining capital
expenditures1 |
|
7,669 |
|
4,814 |
|
28,751 |
|
14,062 |
|
Brownfields exploration expenditures1 |
|
- |
|
314 |
|
- |
|
1,104 |
| All-in sustaining cash
cost |
|
35,751 |
|
34,837 |
|
116,200 |
|
99,666 |
|
Non-sustaining capital expenditures1 |
|
353 |
|
- |
|
676 |
|
169 |
| All-in cash cost |
|
36,104 |
|
34,837 |
|
116,876 |
|
99,835 |
| Ounces
of gold sold |
|
22,195 |
|
30,052 |
|
74,038 |
|
89,193 |
| All-in
sustaining cash cost per ounce of gold sold |
|
1,611 |
|
1,159 |
|
1,569 |
|
1,117 |
| All-in
cash cost per ounce of gold sold |
|
1,627 |
|
1,159 |
|
1,579 |
|
1,119 |
| 1 Presented on a
cash basis |
| |
|
|
|
|
|
|
|
|
| Yaramoko
Mine |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
|
2022 |
|
2023 |
|
2022 |
| Cash cost applicable |
|
25,587 |
|
|
25,258 |
|
68,372 |
|
68,752 |
| Inventory net realizable value
adjustment |
|
- |
|
|
1,170 |
|
334 |
|
3,125 |
| Royalties and mining
taxes |
|
3,793 |
|
|
2,817 |
|
10,241 |
|
8,898 |
| General and administrative
expenses (operations) |
|
(243 |
) |
|
688 |
|
1,255 |
|
1,570 |
| Standby
costs |
|
- |
|
|
- |
|
2,999 |
|
- |
| Adjusted operating cash
cost |
|
29,137 |
|
|
29,933 |
|
83,201 |
|
82,345 |
| Sustaining leases |
|
1,161 |
|
|
1,419 |
|
3,681 |
|
4,273 |
| Sustaining capital
expenditures1 |
|
9,451 |
|
|
10,225 |
|
37,318 |
|
26,671 |
|
Brownfields exploration expenditures1 |
|
1,447 |
|
|
2,530 |
|
3,656 |
|
3,018 |
| All-in
sustaining cash cost |
|
41,196 |
|
|
44,107 |
|
127,856 |
|
116,307 |
| All-in cash cost |
|
41,196 |
|
|
44,107 |
|
127,856 |
|
116,307 |
| Ounces
of gold sold |
|
34,029 |
|
|
27,055 |
|
89,447 |
|
81,183 |
| All-in
sustaining cash cost per ounce of gold sold |
|
1,211 |
|
|
1,630 |
|
1,429 |
|
1,433 |
| All-in
cash cost per ounce of gold sold |
|
1,211 |
|
|
1,630 |
|
1,429 |
|
1,433 |
| 1 Presented on a
cash basis |
|
|
|
|
|
|
|
|
|
|
| Séguéla
Mine |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Cash cost applicable |
|
14,108 |
|
- |
|
14,108 |
|
- |
| Royalties and mining
taxes |
|
4,568 |
|
- |
|
4,568 |
|
- |
| General
and administrative expenses (operations) |
|
3,112 |
|
- |
|
3,112 |
|
- |
|
Adjusted operating cash cost |
|
21,788 |
|
- |
|
21,788 |
|
- |
| Sustaining leases |
|
3,044 |
|
- |
|
3,044 |
|
- |
| Sustaining capital
expenditures1 |
|
3,147 |
|
- |
|
3,147 |
|
- |
| All-in
sustaining cash cost |
|
27,979 |
|
- |
|
27,979 |
|
- |
| All-in cash cost |
|
27,979 |
|
- |
|
27,979 |
|
- |
| Ounces
of gold sold |
|
35,503 |
|
- |
|
35,503 |
|
- |
| All-in
sustaining cash cost per ounce of gold sold |
|
788 |
|
- |
|
788 |
|
- |
| All-in
cash cost per ounce of gold sold |
|
788 |
|
- |
|
788 |
|
- |
| 1 Presented on a
cash basis |
| |
|
|
|
|
|
|
|
|
Reconciliation of all-in sustaining cash cost per ounce
of gold equivalent sold for the three and nine months ended
September 30, 2023 and 2022
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
| Cash cost applicable |
|
105,514 |
|
87,083 |
|
274,315 |
|
246,701 |
| Inventory adjustment - cash
portion |
|
- |
|
1,170 |
|
334 |
|
3,150 |
| Royalties, export duties and
mining taxes |
|
13,071 |
|
8,195 |
|
30,277 |
|
25,778 |
| Workers' participation |
|
936 |
|
1,745 |
|
1,642 |
|
3,952 |
| General and administrative
expenses (operations) |
|
7,920 |
|
5,228 |
|
19,875 |
|
16,047 |
| General and administrative
expenses (Corporate) |
|
6,219 |
|
7,283 |
|
23,300 |
|
27,328 |
| Standby
costs |
|
- |
|
- |
|
7,083 |
|
- |
| Adjusted operating cash
cost |
|
133,660 |
|
110,704 |
|
356,826 |
|
322,955 |
| Sustaining leases |
|
5,872 |
|
3,006 |
|
11,778 |
|
9,098 |
| Sustaining capital
expenditures |
|
27,243 |
|
23,213 |
|
89,311 |
|
64,275 |
|
Brownfields exploration expenditures |
|
3,326 |
|
4,590 |
|
7,951 |
|
9,495 |
| All-in sustaining cash
cost |
|
170,101 |
|
141,513 |
|
465,866 |
|
405,824 |
| Payable
ounces of gold equivalent sold |
|
129,627 |
|
98,873 |
|
309,196 |
|
293,423 |
| All-in
sustaining cash cost per ounce of gold equivalent sold |
|
1,312 |
|
1,431 |
|
1,507 |
|
1,383 |
| Gold equivalent
was calculated using the realized prices for gold of $1,924/oz Au,
$23.7/oz Ag, $2,136/t Pb, and $2,428/t Zn for Q3 2023 and using the
realized prices for gold of $1,718/oz Au, $19.2/oz Ag, $1,989/t Pb,
and $3,268/t Zn for Q3 2022. |
| Gold equivalent
was calculated using the realized prices for gold of $1,927/oz Au,
$23.4/oz Ag, $2,162/t Pb, and $2,778/t Zn for YTD 2023 and using
the realized prices for gold of $1,823/oz Au, $21.9/oz Ag, $2,181/t
Pb, and $3,634/t Zn for YTD 2022. |
Reconciliation of production cash cost per tonne and
cash cost per payable ounce of silver equivalent sold for the three
and nine months ended September 30, 2023 and 2022
| |
|
|
|
|
|
|
|
|
|
| San Jose
Mine |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Cost of sales |
|
|
37,071 |
|
|
32,936 |
|
|
98,960 |
|
|
94,313 |
|
| Changes in concentrate
inventory |
|
|
(72 |
) |
|
(209 |
) |
|
(90 |
) |
|
(137 |
) |
| Cost of sales-right of
use |
|
|
213 |
|
|
- |
|
|
540 |
|
|
- |
|
| Depletion and depreciation in
concentrate inventory |
|
|
25 |
|
|
68 |
|
|
26 |
|
|
49 |
|
| Inventory adjustment |
|
|
228 |
|
|
312 |
|
|
(66 |
) |
|
266 |
|
| Royalties and mining
taxes |
|
|
(1,278 |
) |
|
(1,261 |
) |
|
(3,575 |
) |
|
(4,002 |
) |
| Workers participation |
|
|
(341 |
) |
|
(979 |
) |
|
(91 |
) |
|
(1,876 |
) |
|
Depletion and depreciation |
|
|
(10,233 |
) |
|
(9,659 |
) |
|
(28,677 |
) |
|
(27,265 |
) |
| Cash cost3 |
A |
|
25,613 |
|
|
21,208 |
|
|
67,027 |
|
|
61,348 |
|
| Total
processed ore (tonnes) |
B |
|
247,542 |
|
|
267,198 |
|
|
689,165 |
|
|
770,090 |
|
|
Production cash cost per tonne ($/t) |
=A/B |
|
103.47 |
|
|
79.37 |
|
|
97.26 |
|
|
79.66 |
|
| Cash cost3 |
A |
|
25,613 |
|
|
21,208 |
|
|
67,027 |
|
|
61,348 |
|
| Changes in concentrate
inventory |
|
|
72 |
|
|
209 |
|
|
90 |
|
|
137 |
|
| Depletion and depreciation in
concentrate inventory |
|
|
(25 |
) |
|
(68 |
) |
|
(26 |
) |
|
(49 |
) |
| Inventory adjustment |
|
|
(228 |
) |
|
(312 |
) |
|
66 |
|
|
(266 |
) |
| Treatment charges |
|
|
54 |
|
|
(173 |
) |
|
279 |
|
|
(228 |
) |
|
Refining charges |
|
|
956 |
|
|
997 |
|
|
2,569 |
|
|
2,789 |
|
| Cash cost applicable per
payable ounce sold |
C |
|
26,442 |
|
|
21,861 |
|
|
70,005 |
|
|
63,731 |
|
| Payable
ounces of silver equivalent sold1 |
D |
|
1,910,609 |
|
|
2,254,673 |
|
|
5,194,670 |
|
|
6,159,782 |
|
| Cash
cost per ounce of payable silver equivalent sold2 ($/oz) |
=C/D |
|
13.84 |
|
|
9.70 |
|
|
13.48 |
|
|
10.35 |
|
| Mining cost per tonne |
|
|
49.98 |
|
|
37.72 |
|
|
44.86 |
|
|
37.48 |
|
| Milling cost per tonne |
|
|
20.92 |
|
|
17.49 |
|
|
21.47 |
|
|
18.74 |
|
| Indirect cost per tonne |
|
|
21.77 |
|
|
16.09 |
|
|
21.05 |
|
|
15.48 |
|
| Community relations cost per
tonne |
|
|
3.87 |
|
|
2.68 |
|
|
3.28 |
|
|
2.55 |
|
|
Distribution cost per tonne |
|
|
6.93 |
|
|
5.39 |
|
|
6.60 |
|
|
5.41 |
|
|
Production cash cost per tonne ($/t) |
|
|
103.47 |
|
|
79.37 |
|
|
97.26 |
|
|
79.66 |
|
| 1 Silver equivalent
sold for Q3 2023 is calculated using a silver to gold ratio of
81.7:1 (Q3 2022: 90.0:1). Silver equivalent sold for YTD 2023 is
calculated using silver to gold ratio of 82.6:1 (YTD 2022:
83.5:1) |
| 2 Silver equivalent
is calculated using the realized prices for gold and silver. Refer
to Financial Results – Sales and Realized Prices |
| |
|
|
|
|
|
|
|
|
|
| Caylloma
Mine |
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
| Cost of sales |
|
|
16,159 |
|
|
17,512 |
|
|
50,810 |
|
|
50,815 |
|
| Changes in concentrate
inventory |
|
|
188 |
|
|
135 |
|
|
143 |
|
|
11 |
|
| Cost of sales-right of
use |
|
|
437 |
|
|
- |
|
|
1,567 |
|
|
- |
|
| Depletion and depreciation in
concentrate inventory |
|
|
25 |
|
|
(30 |
) |
|
(66 |
) |
|
(196 |
) |
| Inventory adjustment |
|
|
561 |
|
|
(491 |
) |
|
(36 |
) |
|
(179 |
) |
| Royalties and mining
taxes |
|
|
(166 |
) |
|
(218 |
) |
|
(851 |
) |
|
(686 |
) |
| Provision for community
support |
|
|
109 |
|
|
123 |
|
|
32 |
|
|
97 |
|
| Workers participation |
|
|
(449 |
) |
|
(455 |
) |
|
(1,326 |
) |
|
(1,389 |
) |
|
Depletion and depreciation |
|
|
(2,960 |
) |
|
(3,619 |
) |
|
(9,848 |
) |
|
(10,952 |
) |
| Cash cost3 |
A |
|
13,904 |
|
|
12,957 |
|
|
40,425 |
|
|
37,521 |
|
| Total
processed ore (tonnes) |
B |
|
140,077 |
|
|
139,143 |
|
|
403,077 |
|
|
407,695 |
|
|
Production cash cost per tonne ($/t) |
=A/B |
|
99.25 |
|
|
93.12 |
|
|
100.29 |
|
|
92.03 |
|
| Cash cost |
A |
|
13,905 |
|
|
12,957 |
|
|
40,425 |
|
|
37,521 |
|
| Changes in concentrate
inventory |
|
|
(188 |
) |
|
(135 |
) |
|
(143 |
) |
|
(11 |
) |
| Depletion and depreciation in
concentrate inventory |
|
|
(25 |
) |
|
30 |
|
|
66 |
|
|
196 |
|
| Inventory adjustment |
|
|
(561 |
) |
|
491 |
|
|
36 |
|
|
179 |
|
| Treatment charges |
|
|
4,714 |
|
|
3,028 |
|
|
14,913 |
|
|
11,195 |
|
|
Refining charges |
|
|
258 |
|
|
389 |
|
|
822 |
|
|
1,153 |
|
| Cash cost applicable per
payable ounce sold |
C |
|
18,103 |
|
|
16,760 |
|
|
56,119 |
|
|
50,233 |
|
| Payable
ounces of silver equivalent sold1 |
D |
|
1,158,881 |
|
|
1,480,688 |
|
|
3,869,253 |
|
|
4,101,900 |
|
| Cash
cost per ounce of payable silver equivalent sold2,3 ($/oz) |
=C/D |
|
15.62 |
|
|
11.32 |
|
|
14.50 |
|
|
12.25 |
|
| Mining cost per tonne |
|
|
47.07 |
|
|
41.38 |
|
|
46.07 |
|
|
39.04 |
|
| Milling cost per tonne |
|
|
13.16 |
|
|
14.57 |
|
|
14.56 |
|
|
15.24 |
|
| Indirect cost per tonne |
|
|
29.58 |
|
|
28.46 |
|
|
29.92 |
|
|
29.50 |
|
| Community relations cost per
tonne |
|
|
0.70 |
|
|
1.30 |
|
|
0.72 |
|
|
0.93 |
|
|
Distribution cost per tonne |
|
|
8.74 |
|
|
7.43 |
|
|
9.02 |
|
|
7.34 |
|
|
Production cash cost per tonne ($/t) |
|
|
99.25 |
|
|
93.14 |
|
|
100.29 |
|
|
92.05 |
|
| 1 Silver equivalent
sold for Q3 2023 is calculated using a silver to gold ratio of
80.3:1 (Q3 2022: 0.0:1), silver to lead ratio of 1:24.7 pounds (Q3
2022: 1:21.4), and silver to zinc ratio of 1:21.7 pounds (Q3 2022:
1:13.0). Silver equivalent sold for YTD 2023 is calculated using a
silver to gold ratio of 80.9:1 (YTD 2022: 84.8:1), silver to lead
ratio of 1:24.0 pounds (YTD 2022: 1:22.2), and silver to zinc ratio
of 1:18.6 pounds (YTD 2022: 1:13.3). |
| 2 Silver equivalent
is calculated using the realized prices for gold, silver, lead, and
zinc. Refer to Financial Results - Sales and Realized Prices |
Reconciliation of all-in sustaining cash
cost and all-in cash cost per payable ounce of silver equivalent
sold for the three and nine months ended September 30, 2023 and
2022
| |
|
|
|
|
|
|
|
|
| San Jose
Mine |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
|
2022 |
|
2023 |
|
|
2022 |
| Cash cost applicable |
|
26,442 |
|
|
21,861 |
|
70,004 |
|
|
63,731 |
| Cost of sales-right of
use |
|
(213 |
) |
|
- |
|
(540 |
) |
|
- |
| Royalties and mining
taxes |
|
1,278 |
|
|
1,261 |
|
3,575 |
|
|
4,002 |
| Workers' participation |
|
426 |
|
|
1,224 |
|
114 |
|
|
2,345 |
| General and administrative
expenses (operations) |
|
1,727 |
|
|
1,606 |
|
5,251 |
|
|
4,845 |
|
Stand-by costs |
|
- |
|
|
- |
|
4,084 |
|
|
- |
| Adjusted operating cash
cost |
|
29,660 |
|
|
25,952 |
|
82,488 |
|
|
74,923 |
| Sustaining leases |
|
256 |
|
|
183 |
|
632 |
|
|
489 |
| Sustaining capital
expenditures3 |
|
3,462 |
|
|
4,410 |
|
10,828 |
|
|
12,036 |
|
Brownfields exploration expenditures3 |
|
1,082 |
|
|
1,548 |
|
2,958 |
|
|
4,645 |
| All-in sustaining cash
cost |
|
34,460 |
|
|
32,093 |
|
96,906 |
|
|
92,093 |
|
Non-sustaining capital expenditures3 |
|
385 |
|
|
- |
|
1,178 |
|
|
869 |
| All-in cash cost |
|
34,845 |
|
|
32,093 |
|
98,084 |
|
|
92,962 |
| Payable
ounces of silver equivalent sold1 |
|
1,910,609 |
|
|
2,254,673 |
|
5,194,670 |
|
|
6,159,782 |
| All-in
sustaining cash cost per ounce of payable silver equivalent
sold2 |
|
18.04 |
|
|
14.23 |
|
18.65 |
|
|
14.95 |
| All-in
cash cost per ounce of payable silver equivalent sold2 |
|
18.24 |
|
|
14.23 |
|
18.88 |
|
|
15.09 |
| 1 Silver equivalent
sold for Q3 2023 is calculated using a silver to gold ratio of
81.7:1 (Q3 2022: 90.0:1). Silver equivalent sold for YTD 2023 is
calculated using silver to gold ratio of 82.6:1 (YTD 2022:
83.5:1) |
| 2 Silver equivalent
is calculated using the realized prices for gold and silver. Refer
to Financial Results - Sales and Realized Prices |
| 3 Presented on a
cash basis |
| |
|
|
|
|
|
|
|
|
| Caylloma
Mine |
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
(Expressed in $'000's, except unit costs) |
|
2023 |
|
|
2022 |
|
2023 |
|
|
2022 |
| Cash cost applicable |
|
18,103 |
|
|
16,760 |
|
56,118 |
|
|
50,233 |
| Cost of sales-right of
use |
|
(437 |
) |
|
- |
|
(1,567 |
) |
|
- |
| Royalties and mining
taxes |
|
166 |
|
|
218 |
|
851 |
|
|
686 |
| Workers' participation |
|
510 |
|
|
522 |
|
1,528 |
|
|
1,607 |
| General
and administrative expenses (operations) |
|
1,032 |
|
|
890 |
|
3,466 |
|
|
3,135 |
| Adjusted operating cash
cost |
|
19,374 |
|
|
18,390 |
|
60,396 |
|
|
55,661 |
| Sustaining leases |
|
813 |
|
|
841 |
|
2,626 |
|
|
2,505 |
| Sustaining capital
expenditures3 |
|
3,514 |
|
|
3,764 |
|
9,267 |
|
|
11,506 |
|
Brownfields exploration expenditures3 |
|
797 |
|
|
198 |
|
1,337 |
|
|
729 |
| All-in sustaining cash
cost |
|
24,498 |
|
|
23,193 |
|
73,626 |
|
|
70,401 |
| All-in cash cost |
|
24,498 |
|
|
23,193 |
|
73,626 |
|
|
70,401 |
| Payable
ounces of silver equivalent sold1 |
|
1,158,881 |
|
|
1,480,688 |
|
3,869,253 |
|
|
4,101,900 |
| All-in
sustaining cash cost per ounce of payable silver equivalent
sold2 |
|
21.14 |
|
|
15.66 |
|
19.03 |
|
|
17.16 |
| All-in
cash cost per ounce of payable silver equivalent sold2 |
|
21.14 |
|
|
15.66 |
|
19.03 |
|
|
17.16 |
| 1 Silver equivalent
sold for Q3 2023 is calculated using a silver to gold ratio of
80.3:1 (Q3 2022: 0.0:1), silver to lead ratio of 1:24.7 pounds (Q3
2022: 1:21.4), and silver to zinc ratio of 1:21.7 pounds (Q3 2022:
1:13.0). Silver equivalent sold for YTD 2023 is calculated using a
silver to gold ratio of 80.9:1 (YTD 2022: 84.8:1), silver to lead
ratio of 1:24.0 pounds (YTD 2022: 1:22.2), and silver to zinc ratio
of 1:18.6 pounds (YTD 2022: 1:13.3). |
| 2 Silver equivalent
is calculated using the realized prices for gold, silver, lead, and
zinc. Refer to Financial Results - Sales and Realized Prices |
| 3 Presented on a
cash basis |
| |
Additional information regarding the Company’s
financial results and activities underway are available in the
Company’s unaudited condensed interim consolidated financial
statements for the three and nine months ended September 30, 2023
and accompanying Q3 2023 MD&A, which are available for download
on the Company’s website, www.fortunasilver.com, on SEDAR+ at
www.sedarplus.ca and on EDGAR at www.sec.gov/edgar.
Conference Call and Webcast
A conference call to discuss the financial and
operational results will be held on Thursday, November 9, 2023, at
9:00 a.m. Pacific time | 12:00 p.m. Eastern time. Hosting the call
will be Jorge A. Ganoza, President and CEO, Luis D. Ganoza, Chief
Financial Officer, Cesar Velasco, Chief Operating Officer - Latin
America, and David Whittle, Chief Operating Officer - West
Africa.
Shareholders, analysts, media and interested
investors are invited to listen to the live conference call by
logging onto the webcast at:
https://www.webcaster4.com/Webcast/Page/1696/49330 or over the
phone by dialing in just prior to the starting time.
Conference call details:
Date: Thursday, November 9,
2023Time: 9:00 a.m. Pacific time | 12:00 p.m.
Eastern time
Dial in number (Toll Free):
+1.888.506.0062Dial in number (International):
+1.973.528.0011Access code: 101879
Replay number (Toll Free):
+1.877.481.4010Replay number (International):
+1.919.882.2331Replay passcode: 49330
Playback of the earnings call will be available
until Thursday, November 23, 2023. Playback of the webcast will be
available until Saturday, November 9, 2024. In addition, a
transcript of the call will be archived on the
Company’s website. About Fortuna Silver Mines
Inc.
Fortuna Silver Mines Inc. is a Canadian precious
metals mining company with five operating mines in Argentina,
Burkina Faso, Côte d’Ivoire, Mexico, and Peru. Sustainability is
integral to all our operations and relationships. We produce gold
and silver and generate shared value over the long-term for our
stakeholders through efficient production, environmental
protection, and social responsibility. For more information, please
visit our website.
ON BEHALF OF THE BOARD
Jorge A. GanozaPresident, CEO,
and DirectorFortuna Silver Mines Inc.
Investor Relations:
Carlos Baca | info@fortunasilver.com |
www.fortunasilver.com | X |
LinkedIn | YouTube
Forward-looking Statements
This news release contains forward-looking
statements which constitute "forward-looking information" within
the meaning of applicable Canadian securities legislation and
"forward-looking statements" within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act
of 1995 (collectively, "Forward-looking Statements"). All
statements included herein, other than statements of historical
fact, are Forward-looking Statements and are subject to a variety
of known and unknown risks and uncertainties which could cause
actual events or results to differ materially from those reflected
in the Forward-looking Statements. The Forward-looking Statements
in this news release include, without limitation, statements about
the Company's plans for its mines and mineral properties; the
Company’s anticipated financial and operational performance in
2023; estimated production and costs of production for 2023,
including grade and volume of metal produced and sales, revenues
and cashflows, and capital costs (sustaining and non-sustaining),
and operating costs, including projected production cash costs and
all-in sustaining costs, and upward revisions to Yaramoko’s annual
gold production guidance to 110 to 120 thousand ounces from the
original guidance of 92 to 102 thousand ounces; the ability of the
Company to mitigate the inflationary pressures on supplies used in
its operations; estimated capital expenditures and estimated
exploration spending in 2023, including amounts for exploration
activities at its properties; statements regarding the
Company's liquidity, access to capital; the impact of high
inflation on the costs of production and the supply chain;
statements regarding declining stripping ratio, expected tonnage of
ore to be placed on the leach pad, and higher average grade of gold
at Lindero for the fourth quarter; the Company’s expectation that
the leach pad expansion project at Lindero will be completed during
the second half of 2024; statements that drilling will continue on
the western portion of Zone 55 at Yaramoko during the fourth
quarter of 2023; statements that stripping and initial mining of
oxide material at Séguéla is schedule to begin in the fourth
quarter; the expected timing for completion of initial grade
control drilling at the Koula deposit; the Company's business
strategy, plans and outlook; the merit of the Company's mines and
mineral properties; mineral resource and reserve estimates, metal
recovery rates, concentrate grade and quality; changes in tax rates
and tax laws, requirements for permits, anticipated approvals and
other matters. Often, but not always, these Forward-looking
Statements can be identified by the use of words such as
"estimated", “expected”, “anticipated”, "potential", "open",
"future", "assumed", "projected", "used", "detailed", "has been",
"gain", "planned", "reflecting", "will", "containing", "remaining",
"to be", or statements that events, "could" or "should" occur or be
achieved and similar expressions, including negative
variations.
Forward-looking Statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to be
materially different from any results, performance or achievements
expressed or implied by the Forward-looking Statements. Such
uncertainties and factors include, among others, changes in general
economic conditions and financial markets; uncertainty relating to
new mining operations such as the Séguéla Mine, including the
possibility that actual capital and operating costs and economic
returns will differ significantly from those estimated for such
projects prior to production; risks associated with war or
other geo-political hostilities, such as the Ukrainian – Russian
conflict, any of which could continue to cause a disruption in
global economic activity; fluctuation in currencies and foreign
exchange rates; increases in the rate of inflation; the imposition
or any extension of capital controls in countries in which the
Company operates; any changes in tax laws in Argentina and the
other countries in which we operate; changes in the prices of key
supplies; technological and operational hazards in Fortuna’s mining
and mine development activities; risks inherent in mineral
exploration; uncertainties inherent in the estimation of mineral
reserves, mineral resources, and metal recoveries; changes to
current estimates of mineral reserves and resources; changes to
production and cost estimates; the possibility that the ruling in
favour of Compania Minera Cuzcatlan S.A. de C.V. (“Minera
Cuzcatlan”) to reinstate the environmental impact authorization at
the San Jose mine (the “EIA”) will be successfully appealed;
changes in the position of regulatory authorities with respect to
the granting of approvals or permits; governmental and other
approvals; changes in government, political unrest or instability
in countries where Fortuna is active; labor relations issues; as
well as those factors discussed under “Risk Factors” in the
Company's Annual Information Form. Although the Company has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in Forward-looking Statements, there may be other factors
that cause actions, events or results to differ from those
anticipated, estimated or intended.
Forward-looking Statements contained herein are
based on the assumptions, beliefs, expectations and opinions of
management, including but not limited to the accuracy of the
Company’s current mineral resource and reserve estimates; that the
Company’s activities will be conducted in accordance with the
Company’s public statements and stated goals; that there will be no
material adverse change affecting the Company, its properties or
changes to production estimates (which assume accuracy of projected
ore grade, mining rates, recovery timing, and recovery rate
estimates and may be impacted by unscheduled maintenance, labour
and contractor availability and other operating or technical
difficulties); geo-political uncertainties that may affect
the Company’s production, workforce, business, operations and
financial condition; the expected trends in mineral prices and
currency exchange rates; that the Company will be successful in
mitigating the impact of inflation on its business and operations;
if an appeal is made in respect of the ruling in favour of Minera
Cuzcatlan reinstating the EIA, that such appeal won’t be
successful; that Minera Cuzcatlan will be successful in the legal
proceedings to reinstate the environmental impact authorization at
the San Jose mine; that all required approvals and permits will be
obtained for the Company’s business and operations on acceptable
terms; that there will be no significant disruptions affecting the
Company's operations, the ability to meet current and future
obligations and such other assumptions as set out herein.
Forward-looking Statements are made as of the date hereof and the
Company disclaims any obligation to update any Forward-looking
Statements, whether as a result of new information, future events
or results or otherwise, except as required by law. There can be no
assurance that these Forward-looking Statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
investors should not place undue reliance on Forward-looking
Statements.
Cautionary Note to United States Investors
Concerning Estimates of Reserves and Resources
Reserve and resource estimates included in this
news release have been prepared in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI
43-101") and the Canadian Institute of Mining, Metallurgy, and
Petroleum Definition Standards on Mineral Resources and Mineral
Reserves. NI 43-101 is a rule developed by the Canadian Securities
Administrators that establishes standards for public disclosure by
a Canadian company of scientific and technical information
concerning mineral projects. Unless otherwise indicated, all
mineral reserve and mineral resource estimates contained in the
technical disclosure have been prepared in accordance with NI
43-101 and the Canadian Institute of Mining, Metallurgy and
Petroleum Definition Standards on Mineral Resources and Reserves.
Canadian standards, including NI 43-101, differ significantly from
the requirements of the Securities and Exchange Commission, and
mineral reserve and resource information included in this news
release may not be comparable to similar information disclosed by
U.S. companies.
Fortuna Silver Mines (TSX:FVI)
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Fortuna Silver Mines (TSX:FVI)
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