Pan American Silver Announces Renewal of Normal Course Issuer Bid

Rhea-AI Summary

Pan American Silver (NYSE: PAAS) has announced the renewal of its normal course issuer bid to purchase up to 18,107,917 common shares, representing 5% of its outstanding shares as of February 28, 2025. The buyback program will run from March 6, 2025, to March 5, 2026, through the TSX and NYSE.

Under the current buyback program ending March 5, 2025, the company has already purchased 2,629,378 shares at an average price of C$23.47. The new program will allow maximum daily purchases of 186,936 shares on TSX and 25% of average daily trading volume on NYSE.

The company believes its share price may not fully reflect the underlying value of its mining operations and growth prospects. Purchases will be funded through working capital, with all acquired shares being cancelled. Pan American has established an automatic securities purchase plan with National Bank Financial for consistent repurchases.

Positive

• Share buyback program indicates strong cash position
• Company demonstrates confidence in underlying value
• Automatic purchase plan ensures consistent execution
• All repurchased shares will be cancelled, potentially increasing value per share

Negative

• Significant cash outflow from working capital for buybacks
• Reduced cash available for operational growth or acquisitions

Insights

Financial Analyst

Pan American Silver's renewal of its normal course issuer bid (share buyback program) authorizes the company to repurchase up to 18.1 million shares (5% of outstanding shares) over the next year. This represents a significant potential capital return mechanism for shareholders.

The company's execution under its existing program reveals a measured approach - they've repurchased only 2.6 million shares (14.4% of the maximum authorization) at an average price of C$23.47. This suggests management has been selective rather than aggressive in their repurchasing activity, deploying capital opportunistically rather than exhausting the full authorization.

A notable aspect of this renewal is the establishment of an automatic securities purchase plan (ASPP) with National Bank Financial. This mechanism enables share repurchases during periods when the company would typically be restricted from market activity due to blackout periods, providing greater flexibility in execution.

For investors, it's important to recognize that while the authorization is substantial, the company explicitly states it "is not obligated to make any purchases." This creates optionality without firm commitment - essentially establishing a potential price support mechanism that can be activated at management's discretion when they believe shares are undervalued.

The funding from working capital indicates the company believes it has sufficient operational liquidity to support both core mining activities and selective share repurchases without compromising financial stability. In the precious metals sector, this balanced capital allocation approach signals confidence in the company's cash flow generation while acknowledging potential disconnects between market price and underlying asset value.

VANCOUVER, British Columbia--(BUSINESS WIRE)-- Pan American Silver Corp. (NYSE: PAAS) (TSX: PAAS) ("Pan American" or the "Company") announces that the Toronto Stock Exchange (the "TSX") has accepted the Company’s notice of its intention to renew its normal course issuer bid (the "Bid") to purchase up to 18,107,917 of its common shares, representing up to 5% of Pan American’s issued and outstanding shares as at February 28, 2025. Purchases pursuant to the Bid will be made on the open market through the facilities of the TSX and the New York Stock Exchange ("NYSE") and alternative trading systems in Canada and the United States. The period of the Bid will begin on March 6, 2025 and will continue until March 5, 2026, or an earlier date should the Company complete its purchases.

Pan American will pay the market price at the time of acquisition of any common shares in accordance with the rules and policies of the TSX and NYSE and applicable securities laws. All common shares acquired by the Company under the Bid will be cancelled and purchases will be funded out of Pan American’s working capital. Although the Company has a present intention to acquire its common shares pursuant to the Bid, it is not obligated to make any purchases, and the actual number of common shares to be purchased, and the timing of any purchases, will be at the Company’s discretion.

Under its current normal course issuer bid that commenced on March 6, 2024 and expires on March 5, 2025 (the "Current Bid"), the Company received approval from the TSX to purchase up to 18,232,990 common shares. As of February 28, 2025, the Company purchased under the Current Bid, through the facilities of the TSX, NYSE and alternative trading systems, 2,629,378 common shares at a volume weighted average price of approximately C$23.47 per common share.

As at February 28, 2025, the number of Pan American’s issued and outstanding common shares totaled 362,158,353. In accordance with the rules of the TSX, the maximum daily purchases on the TSX under the Bid will be 186,936 common shares, which is 25% of the average daily trading volume for the Company’s common shares on the TSX for the six months ended February 28, 2025, which was 747,747 common shares. In accordance with applicable U.S. securities laws, the maximum daily purchases on NYSE under the Bid will be 25% of the average daily trading volume for the Company’s common shares in the four calendar weeks preceding the date of purchase, subject to certain exceptions for block purchases.

Pan American is undertaking the Bid because, in the opinion of its Board of Directors, the market price of its common shares, from time to time, may not fully reflect the underlying value of its mining operations, properties and future growth prospects. The Company believes that in such circumstances, the outstanding common shares represent an accretive investment for Pan American since a portion of the Company’s excess cash generated on an annual basis can be invested for an attractive risk adjusted return on capital through the Bid.

Pan American has established an automatic securities purchase plan ("ASPP") with its broker, National Bank Financial Inc., to allow for the repurchase of common shares under the Bid at any time, including when it ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules or otherwise. The ASPP has been pre-cleared by the TSX and will be effective contemporaneously with the Bid. All purchases made under the ASPP will be included in computing the number of shares purchased and cancelled by the Company under the Bid.

A copy of the Company’s Notice of Intention to Make a Normal Course Issuer Bid filed with the TSX can be obtained from the Corporate Secretary of Pan American without charge.

About Pan American Silver

Pan American Silver is a leading producer of precious metals in the Americas, operating silver and gold mines in Canada, Mexico, Peru, Brazil, Bolivia, Chile and Argentina. We also own the Escobal mine in Guatemala that is currently not operating, and we hold interests in exploration and development projects. We have been operating in the Americas for over three decades, earning an industry-leading reputation for sustainability performance, operational excellence and prudent financial management. We are headquartered in Vancouver, B.C. and our shares trade on the New York Stock Exchange and the Toronto Stock Exchange under the symbol “PAAS”.

Learn more at panamericansilver.com

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Cautionary Note Regarding Forward-Looking Statements and Information

Certain of the statements and information in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian provincial securities laws. All statements, other than statements of historical fact, are forward-looking statements or information. Forward-looking statements or information in this news release relate to, among other things, statements with respect to the terms which the Bid will be operated, including the timing, number and price of common shares that may be purchased under the Bid, and any anticipated benefits or results of the Bid.

These forward-looking statements and information reflect Pan American’s current views with respect to future events and are necessarily based upon a number of assumptions that, while considered reasonable by Pan American, are inherently subject to significant operational, business, economic and regulatory uncertainties and contingencies. Pan American cautions the reader that forward-looking statements and information involve known and unknown risks, uncertainties and other factors that may cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements or information contained in this news release and Pan American has made assumptions and estimates based on or related to many of these factors. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are those factors identified under the heading “Risk Factors” in Pan American’s filings with the U.S. Securities and Exchange Commission and Canadian provincial securities regulatory authorities, respectively. Although Pan American has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Investors are cautioned against undue reliance on forward-looking statements or information. Forward-looking statements and information are designed to help readers understand management’s current views of our near and longer term prospects and may not be appropriate for other purposes. Pan American does not intend, nor does it assume any obligation to update or revise forward-looking statements or information, whether as a result of new information, changes in assumptions, future events or otherwise, except to the extent required by applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250303102096/en/

For more information contact:

Siren Fisekci

VP, Investor Relations & Corporate Communications

Ph: 604-806-3191

Email: ir@panamericansilver.com

Source: Pan American Silver

FAQ

How many shares can Pan American Silver (PAAS) buy back under the new program?

PAAS can purchase up to 18,107,917 common shares, representing 5% of its outstanding shares as of February 28, 2025.

What is the duration of PAAS's new share buyback program?

The program runs from March 6, 2025, to March 5, 2026.

How many shares did PAAS purchase under its current buyback program?

Under the current program, PAAS purchased 2,629,378 shares at an average price of C$23.47 per share.

What are the daily purchase limits for PAAS's share buyback on TSX?

The maximum daily purchases on TSX are to 186,936 common shares, representing 25% of the average daily trading volume.

How will Pan American Silver fund the share buyback program?

The share buyback will be funded through Pan American's working capital.