Earnings slump as Endeavour holds onto its silver
Investor Insight: InterGroup Mining
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The company's adjusted net earnings of US$2.4 million in Q2 last year slumped some 280% to a loss of $4.3 million in the quarter this year. On a per share basis, they fell from an earning of $0.01 to a loss of $0.02 over the same period.
"During the 2nd quarter, again we made the decision to withhold from sale a meaningful amount of silver, due to the drop in silver price," Endeavour Silver's CEO Dan Dickson said.
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SPONSOREDintergroup mining
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SPONSOREDbarton gold holdings limited
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A total of 1.6 million silver-equivalent ounces are being held which has caused a "short term" hit to earnings, he said.
Meanwhile, with its two producing mines in Mexico, Endeavour now expects to produce 7.6 million-8 million silver-equivalent ounces in 2022, which compares to its previous guidance of 6.7 million-7.6 million AgEq oz.
"We have continued to outperform our mine plans, by delivering an exceptional Q2 with production 15% above plan," the company's CEO Dan Dickson said.
"The additional production has allowed us to maintain our cost guidance on per ounce metrics, but industry-wide inflation continues to be a challenge," he said.
The 2022 all-in sustaining costs guidance stands at $20-$21/oz.
Dickson noted the largest inflationary impacts have been on energy cost, plant reagents, and steel prices.
"Cost control will continue to be a key focus as cost pressures are expected to continue for the remainder of the year," he said.
On the day of the announcement, 9 August, Endeavour's share price was down 4% day on day at C$4.68 (US$3.63). The company has a market capitalization of C$887.46 million.