Sierra Metals Subsidiary in Peru, Sociedad Minera Corona Reports Q1-2022 Financial Results
Sierra Metals Inc. (SMTS) reported its Q1 2022 financial results for Sociedad Minera Corona S.A., revealing a 15% revenue decline to $35.8 million and an 8% drop in adjusted EBITDA to $14.8 million. Cash costs rose by 48% to $2.19 per copper equivalent pound, while the all-in sustaining cost increased by 40% to $3.70. Notably, copper production surged by 60%, but overall metal production fell significantly, leading to a 32% decrease in copper equivalent production. The net income for the quarter was $10.5 million, marking a 103% increase year-over-year due to deferred tax recovery.
- Net income increased by 103% to $10.5 million.
- Copper production rose 60% compared to Q1 2021.
- Revenue decreased by 15% to $35.8 million.
- Adjusted EBITDA declined by 8% to $14.8 million.
- Copper equivalent production fell by 32%.
(All metal prices reported in USD)
Image 1:
The Company holds an
Corona’s Q1-2022 financial statements have not been reviewed by the Sierra Metals Board. The Company will be releasing its Q1-2022 consolidated financial statements on
Corona's Highlights for the Three Months Ended
-
Revenues of
US , a$35.8 million 15% decrease from Q1 2021. -
Adjusted EBITDA of
US , an$14.8 million 8% decrease from Q1 2021. -
Total tonnes processed of 315,250, a
3% decrease from Q1 2021. -
Net production revenue per tonne of ore milled decreased by
5% toUS .$121.34 -
Cash Cost per copper equivalent payable pound higher by
48% toUS .$2.19 -
All-in sustaining cost ("AISC") per copper equivalent payable pound higher by
40% toUS .$3.70 -
Copper equivalent pounds production decreased
32% to 10.9 million pounds. -
of cash and cash equivalents as at$17.0 million March 31, 2022 . -
of working capital as at$70.3 million March 31, 2022 .
The Yauricocha mine processed 315,250 tons during the Q1 2022, which represents a decrease of
The delays in preparation of the polymetallic mining zones forced the mine to focus on copper sulfides during the quarter, which resulted in higher copper head grades, but negatively impacted grades for all other metals, except gold. Q1 2022 copper and gold production was
He continued, "Looking ahead, our priority is to treat ore at full plant capacity and incorporate the newly discovered high-grade areas in order to maximize metal production at current prices.”
He concluded, "We expect that we will be able to make up for the delay in production at Yauricocha, and with improved grades, we are optimistic about our progress in the Mine’s performance going forward.”
The following table displays selected unaudited financial information for the three months ended
Press Release Selected Financial Results | ||||
(In thousands of US dollars, except cash cost and revenue | Three Months Ended | |||
per tonne metrics) | Var % | |||
Revenue | $ | 35,794 |
41,925 |
- |
Adjusted EBITDA (1) | 14,803 |
16,173 |
- |
|
Cash Flow from operations | 11,080 |
16,496 |
- |
|
Gross profit | 13,268 |
16,149 |
- |
|
Income Tax Expense | 1,268 |
(6,842) |
- |
|
Net Income | 10,497 |
5,175 |
|
|
Net production revenue per tonne of ore milled (2) | 121.34 |
128.10 |
- |
|
Cash cost per tonne of ore milled (2) | 59.19 |
60.43 |
- |
|
Cash cost per copper equivalent payable pound (2) | 2.19 |
1.48 |
|
|
All-In Sustaining Cost per copper equivalent payable pound (2) | 3.70 |
2.65 |
|
|
(In thousands of US dollars, unless otherwise stated) | ||||
Cash and cash equivalents | $ | 17,041 |
32,870 |
|
Assets | 235,267 |
232,868 |
||
Liabilities | 58,013 |
66,111 |
||
Equity | 177,254 |
166,757 |
||
(1)
|
Adjusted EBITDA includes adjustments for depletion and depreciation, interest expense and other financing costs, interest income, share-based compensation, Foreign Exchange (gain) loss and income taxes; see non-IFRS Performance Measures section of the Company's MD&A. |
|
(2)
|
Net production revenue per tonne, cash cost per tonne, cash cost per copper equivalent payable pound and All-In Sustaining Cost per copper (‘AISC’) equivalent pound are non-IFRS performance measures. AISC includes the cost of sales, treatment and refining charges, sustaining capital expenditures, general and administrative expense, and selling expense, and exclude workers' profit sharing, depreciation, and other non-cash provisions; see non-IFRS Performance Measures section of the Company’s MD&A. |
The following table displays average realized metal prices information for the quarter ended
Average realized prices |
Quarter ended |
Increase |
|
In US$ | 2022 |
2021 |
(%) |
Silver ($/oz) | 23.95 |
26.44 |
- |
Copper ($/lb) | 4.53 |
3.88 |
|
Zinc ($/lb) | 1.69 |
1.24 |
|
Lead ($/lb) | 1.06 |
0.92 |
|
Gold ($/oz) | 1,875 |
1,778 |
|
Corona's Financial Highlights for the Three Months Ended
-
Revenue from metals payable at the
Yauricocha Mine inPeru of for Q1 2022 decreased by$35.8 million 15% compared to of revenues in Q1 2021. Despite higher metal prices, revenues decreased during Q1 2022 mainly due to lower metal production attributable to lower grades except copper. Copper equivalent payable pounds dropped$41.9 million 51% due to lower quantities of metals sold as compared to Q1 2021. -
Yauricocha’s cash cost per copper equivalent payable pound was
(Q1 2021 -$2.19 ), and AISC per copper equivalent payable pound of$1.48 (Q1 2021 -$3.70 ). Higher unit costs resulted from a$2.65 36% decrease in copper equivalent payable pounds. -
Adjusted EBITDA of
US for the first quarter of 2022 compared to$14.8 million US for the same period of 2021. The decrease in Adjusted EBITDA for the first quarter of 2022 compared to the same period of the year 2021 was due to lower revenues from the Company, explained above.$16.2 million -
Operating cash flow before movements in working capital of
US for the first quarter of 2022 compared to$11.1 million US in the same period of 2021.$16.5 million -
Cash and cash equivalents of
as at$17.0 million March 31, 2022 , compared to as at$32.9 million December 31, 2021 . Cash and cash equivalents decreased as cash used in investing activities ( ) and financing activities ($6.2 million ) exceeded cash flow of$10.5 million generated from operating activities.$0.8 million -
Net income of
, or$10.5 million per share for Q1 2022 compared to net income of$0.29 2 , or$5.2 million per share for Q1 2021. The increase in net income during Q1 2022 resulted from the recovery of deferred taxes and no current taxes as there was no taxable income during the quarter.$0.14 4
Corona's Operational Highlights for the Three Months Ended
The following table displays the production results for the three months ended
Yauricocha Production | Three Months Ended |
|||
2022 |
2021 |
% Var. |
||
Tonnes processed | 315,250 |
326,211 |
- |
|
Daily throughput | 3,603 |
3,728 |
- |
|
Silver grade (g/t) | 39.40 |
54.35 |
- |
|
Copper grade |
|
|
|
|
Lead grade |
|
|
- |
|
Zinc grade |
|
|
- |
|
Gold Grade (g/t) | 0.52 |
0.43 |
|
|
Silver recovery |
|
|
- |
|
Copper recovery |
|
|
|
|
Lead recovery |
|
|
- |
|
Zinc recovery |
|
|
- |
|
Gold Recovery |
|
|
|
|
Silver production (000 oz) | 256 |
451 |
- |
|
Copper production (000 lb) | 4,279 |
2,682 |
|
|
Lead production (000 lb) | 3,828 |
8,706 |
- |
|
Zinc production (000 lb) | 10,492 |
24,123 |
- |
|
Gold Production (oz) | 1,057 |
890 |
|
|
Copper equivalent |
10,876 |
15,937 |
- |
|
(1)
|
Copper equivalent pounds for Q1 2022 were calculated using the following realized prices: |
Quality Control
Américo Zuzunaga, FAusIMM CP (
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Forward-Looking Statements
This press release contains "forward-looking information" and "forward-looking statements" within the meaning of Canadian and
Forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the risks described under the heading "Risk Factors" in the Company's annual information form dated
The risk factors referred to above are not an exhaustive list of the factors that may affect any of the Company's forward-looking information. Forward-looking information includes statements about the future and is inherently uncertain, and the Company's actual achievements or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors. The Company's statements containing forward-looking information are based on the beliefs, expectations, and opinions of management on the date the statements are made, and the Company does not assume any obligation to update such forward-looking information if circumstances or management's beliefs, expectations or opinions should change, other than as required by applicable law. For the reasons set forth above, one should not place undue reliance on forward-looking information.
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