Sierra Metals Reports Second Quarter 2024 Consolidated Financial Results
Sierra Metals reported Q2 2024 consolidated financial results, showing a 2% revenue decrease to $57.5 million compared to Q2 2023. Adjusted EBITDA dropped 11% to $12.9 million due to increased G&A costs. However, operating cash flow improved to $14.9 million from $11.6 million in the previous year.
Despite lower grades at Yauricocha and Bolivar mines, the company expects production to ramp up in H2 2024. Cash and cash equivalents increased nearly 150% to $22.5 million. Additionally, Sierra Metals sold the Cusi Mine for $2.5 million, simplifying its focus to Yauricocha and Bolivar mines.
Q2 2024 saw operational challenges but Sierra remains on track to meet its 2024 guidance, supported by new equipment and higher throughput rates. Shares of Sierra Metals began trading on the Lima Stock Exchange, providing better exposure to Chilean, Colombian, and Peruvian markets.
Sierra Metals ha riportato i risultati finanziari consolidati del secondo trimestre 2024, evidenziando un calo del 2% dei ricavi a 57,5 milioni di dollari rispetto al secondo trimestre 2023. L'EBITDA rettificato è diminuito dell'11% a 12,9 milioni di dollari a causa dell'aumento dei costi generali e amministrativi. Tuttavia, il flusso di cassa operativo è migliorato a 14,9 milioni di dollari rispetto agli 11,6 milioni dell'anno precedente.
Nonostante i gradi di minerale più bassi nelle miniere di Yauricocha e Bolivar, l'azienda prevede un aumento della produzione nella seconda metà del 2024. Liquidità e equivalenti di cassa sono aumentati di quasi il 150% a 22,5 milioni di dollari. Inoltre, Sierra Metals ha venduto la miniera di Cusi per 2,5 milioni di dollari, semplificando il suo focus sulle miniere di Yauricocha e Bolivar.
Il secondo trimestre 2024 ha visto sfide operative, ma Sierra rimane sulla buona strada per raggiungere le sue previsioni per il 2024, supportata da nuovi equipaggiamenti e tassi di rendimento più elevati. Le azioni di Sierra Metals hanno iniziato a essere negoziate sulla Borsa di Lima, offrendo una migliore visibilità sui mercati cileno, colombiano e peruviano.
Sierra Metals reportó resultados financieros consolidados del segundo trimestre de 2024, mostrando una disminución del 2% en los ingresos a 57.5 millones de dólares en comparación con el segundo trimestre de 2023. El EBITDA ajustado cayó un 11% a 12.9 millones de dólares debido al aumento de los costos generales y administrativos. Sin embargo, el flujo de efectivo operativo mejoró a 14.9 millones de dólares desde 11.6 millones del año anterior.
A pesar de los menores grados en las minas de Yauricocha y Bolivar, la compañía espera que la producción aumente en la segunda mitad de 2024. La liquidez y equivalentes de efectivo aumentaron casi un 150% a 22.5 millones de dólares. Además, Sierra Metals vendió la mina Cusi por 2.5 millones de dólares, simplificando su enfoque en las minas de Yauricocha y Bolivar.
El segundo trimestre de 2024 enfrentó desafíos operativos, pero Sierra sigue en camino de cumplir con su guía para 2024, respaldada por nuevos equipos y mayores tasas de producción. Las acciones de Sierra Metals comenzaron a cotizar en la Bolsa de Valores de Lima, proporcionando una mejor exposición a los mercados chileno, colombiano y peruano.
시에라 메탈즈는 2024년 2분기 통합 재무 결과를 보고하며, 2023년 2분기와 비교하여 수익이 2% 감소한 5,750만 달러를 기록했다고 발표했습니다. 조정된 EBITDA는 일반 관리 비용 증가로 인해 11% 감소하여 1,290만 달러에 이르렀습니다. 그러나 운영 현금 흐름은 전년도 1,160만 달러에서 1,490만 달러로 개선되었습니다.
야우리코차와 볼리바르 광산에서 품질이 낮아졌음에도 불구하고, 회사는 2024년 하반기에 생산이 증가할 것으로 예상하고 있습니다. 현금 및 현금성 자산은 거의 150% 증가하여 2,250만 달러에 달했습니다. 추가로, 시에라 메탈즈는 250만 달러에 쿠시 광산을 매각하여 야우리코차와 볼리바르 광산에 집중하고 있습니다.
2024년 2분기는 운영상의 어려움이 있었지만, 시에라는 2024년 가이드를 충족하는데 문제가 없을 것으로 보이며, 신규 장비와 더 높은 처리량으로 지원받고 있습니다. 시에라 메탈즈의 주식은 리마 증권 거래소에서 거래를 시작하며, 칠레, 콜롬비아 및 페루 시장에 대한 노출을 개선하고 있습니다.
Sierra Metals a rapporté ses résultats financiers consolidés du deuxième trimestre 2024, montrant une réduction de 2% des revenus à 57,5 millions de dollars par rapport au deuxième trimestre 2023. L'EBITDA ajusté a chuté de 11 % à 12,9 millions de dollars en raison d'une hausse des coûts généraux et administratifs. Cependant, le flux de trésorerie d'exploitation s'est amélioré, atteignant 14,9 millions de dollars contre 11,6 millions l'année précédente.
Malgré des grades inférieurs dans les mines de Yauricocha et Bolivar, la société prévoit une augmentation de la production dans la seconde moitié de 2024. La trésorerie et les équivalents de trésorerie ont augmenté de près de 150 % pour atteindre 22,5 millions de dollars. De plus, Sierra Metals a vendu la mine de Cusi pour 2,5 millions de dollars, simplifiant son orientation vers les mines de Yauricocha et Bolivar.
Le deuxième trimestre 2024 a rencontré des défis opérationnels, mais Sierra reste sur la bonne voie pour atteindre ses prévisions pour 2024, soutenue par de nouveaux équipements et des taux de production plus élevés. Les actions de Sierra Metals ont commencé à être négociées à la Bourse de Lima, offrant une meilleure visibilité sur les marchés chilien, colombien et péruvien.
Sierra Metals hat die konsolidierten Finanzresultate für das zweite Quartal 2024 veröffentlicht, die einen Rückgang der Einnahmen um 2% auf 57,5 Millionen Dollar im Vergleich zum zweiten Quartal 2023 zeigen. Das bereinigte EBITDA fiel um 11% auf 12,9 Millionen Dollar aufgrund gestiegener Gemein- und Verwaltungskosten. Der operative Cashflow verbesserte sich jedoch auf 14,9 Millionen Dollar, von 11,6 Millionen Dollar im Vorjahr.
Trotz geringerer Gehalte in den Minen Yauricocha und Bolivar erwartet das Unternehmen, dass die Produktion in der zweiten Hälfte von 2024 ansteigt. Die liquiden Mittel und Zahlungsmitteläquivalente stiegen um fast 150% auf 22,5 Millionen Dollar. Darüber hinaus verkaufte Sierra Metals die Cusi-Mine für 2,5 Millionen Dollar, wodurch sich der Fokus auf die Minen Yauricocha und Bolivar vereinfachte.
Im zweiten Quartal 2024 gab es betriebliche Herausforderungen, doch Sierra bleibt auf Kurs, um die Prognose für 2024 zu erfüllen, unterstützt durch neue Ausrüstungen und höhere Durchsatzraten. Die Aktien von Sierra Metals begannen an der Börse von Lima zu handeln und bieten eine bessere Sichtbarkeit auf die Märkte in Chile, Kolumbien und Peru.
- Cash and cash equivalents increased nearly 150% to $22.5 million.
- Operating cash flow improved to $14.9 million from $11.6 million in Q2 2023.
- Sale of Cusi Mine adds $2.5 million in cash and a 2% net smelter royalty.
- Shares began trading on the Lima Stock Exchange, increasing market exposure.
- Revenue decreased 2% to $57.5 million from Q2 2023.
- Adjusted EBITDA dropped 11% to $12.9 million due to increased G&A costs.
- Bolivar's throughput and grades decreased due to maintenance and water availability issues.
- Yauricocha and Bolivar mines had lower grades affecting production.
Q2 2024 Highlights:
- Based on H1-2024 performance and expected production in H2-2024, Sierra Metals reaffirms 2024 annual guidance
- Development below the 1120 Level at Yauricocha remains on schedule to achieve full production by Q4
-
Revenues of
$57.5 million 2% decrease from Q2 2023 -
Adjusted EBITDA(1) of
$12.9 million 11% lower when compared with the adjusted EBITDA of Q2 2023, mainly driven by the increase in G&A costs related to severance payments and organizational changes -
Cash flow generated from operating activities before movements in working capital of
$14.9 million $11.6 million -
Cash and cash equivalents of
$22.5 million 150% when compared to the$9.1 million -
Cusi Mine binding agreement announced and sold in July for
US in cash and a$2.5 million 2.0% net smelter royalty - Commenced trading on the Lima Stock Exchange on June 28, 2024
Management will host a conference call and webcast at 11:00 am ET on August 12, 2024.
All dollar figures are in USD.
(1) This is a non-IFRS performance measure, see non-IFRS Performance Measures section of this press release
Ernesto Balarezo, Sierra Metals’ CEO, comments, “The operating results and financial performance during the second quarter demonstrate the continued momentum in our business. Operationally, we saw improved performance and throughput increases at Yauricocha, mainly driven by the increased access to mining areas and higher levels of extraction. Throughput volumes are expected to continue to improve as development below the 1120 level progresses and we access the massive ore body continuations at depth, allowing us to reach full capacity in the fourth quarter of 2024.
Bolivar had a lower throughput during Q2 2024 which was mainly attributable to the scheduled plant maintenance combined with the lower availability of water for the concentration process. The issue of water availability has been resolved, and we anticipate improved production levels in the second half of the year, supported by the new plant equipment and the regularized rainy season.
We completed the sale of our Cusi property, allowing us to concentrate our focus on Yauricocha and Bolivar moving forward. As well, our shares began trading on the Lima Stock Exchange last month offering increased investor exposure and liquidity potential into the Chilean, Colombian, and Peruvian markets. Overall, we are delighted with our performance in the first half of 2024 as we continue to execute our strategy and maintain momentum into the second half of the year.”
Conference Call & Webcast
Management will host a conference call and webcast at 11:00 am ET on August 12, 2024 to discuss Q2 2024 consolidated operating and financial results. Participate on the telephone at 1-844-763-8276 (
Q2 2024 CONSOLIDATED OPERATING AND FINANCIAL HIGHLIGHTS
| (In thousands of dollars, except per share and cash cost amounts, consolidated figures unless noted otherwise) |
|
|
|
Six months ended June 30, |
|||||||||||
Q2 2024 |
Q1 2024 |
Q2 2023 |
|
2024 |
|
|
2023 |
|
|||||||
| Operating | |||||||||||||||
| Ore Processed / Tonnes Milled |
|
627,015 |
|
|
638,916 |
|
|
650,302 |
|
|
1,265,931 |
|
|
1,168,464 |
|
| Copper Pounds Produced (000's) |
|
8,531 |
|
|
11,247 |
|
|
10,459 |
|
|
19,778 |
|
|
18,744 |
|
| Zinc Pounds Produced (000's) |
|
11,272 |
|
|
10,132 |
|
|
12,228 |
|
|
21,404 |
|
|
22,807 |
|
| Silver Ounces Produced (000's) |
|
387 |
|
|
427 |
|
|
523 |
|
|
814 |
|
|
912 |
|
| Gold Ounces Produced |
|
3,438 |
|
|
4,505 |
|
|
4,311 |
|
|
7,943 |
|
|
8,102 |
|
| Lead Pounds Produced (000's) |
|
3,053 |
|
|
3,049 |
|
|
3,930 |
|
|
6,102 |
|
|
6,708 |
|
| Cash Cost per CuEqLb (Yauricocha)1,2 | $ |
3.44 |
|
$ |
3.27 |
|
$ |
3.38 |
|
$ |
3.32 |
|
$ |
3.13 |
|
| AISC per CuEqLb (Yauricocha)1,2 | $ |
3.79 |
|
$ |
3.69 |
|
$ |
3.85 |
|
$ |
3.60 |
|
$ |
3.43 |
|
| Cash Cost per CuEqLb (Bolivar)1,2 | $ |
2.76 |
|
$ |
2.44 |
|
$ |
2.22 |
|
$ |
2.55 |
|
$ |
2.35 |
|
| AISC per CuEqLb (Bolivar)1,2 | $ |
3.53 |
|
$ |
3.12 |
|
$ |
2.97 |
|
$ |
3.27 |
|
$ |
3.01 |
|
| Financial | |||||||||||||||
| Revenues | $ |
57,524 |
|
$ |
63,140 |
|
$ |
58,411 |
|
$ |
120,664 |
|
$ |
111,948 |
|
| Net income (loss) | |||||||||||||||
| - Continuing operations | $ |
4,912 |
|
$ |
1,630 |
|
$ |
3,897 |
|
$ |
6,542 |
|
$ |
7,606 |
|
| - Discontinued Operations | $ |
(810 |
) |
$ |
(865 |
) |
$ |
(2,824 |
) |
$ |
(1,675 |
) |
$ |
(4,394 |
) |
| Net income (loss) attributable to shareholders, including discontinued operations | $ |
4,115 |
|
$ |
1,159 |
|
$ |
1,638 |
|
$ |
5,274 |
|
$ |
3,691 |
|
| Adjusted EBITDA1 from continuing operations | $ |
12,949 |
|
$ |
17,913 |
|
$ |
14,494 |
|
$ |
30,862 |
|
$ |
29,976 |
|
| Operating cash flows before movements in working capital | $ |
14,923 |
|
$ |
16,486 |
|
$ |
11,588 |
|
$ |
31,408 |
|
$ |
24,439 |
|
| Adjusted net income (loss) attributable to shareholders1 | |||||||||||||||
| - Continuing operations | $ |
5,022 |
|
$ |
5,174 |
|
$ |
5,984 |
|
$ |
10,196 |
|
$ |
11,525 |
|
| - Discontinued Operations | $ |
(810 |
) |
$ |
(865 |
) |
$ |
(1,676 |
) |
$ |
(1,675 |
) |
$ |
(2,471 |
) |
| Cash and cash equivalents | $ |
22,477 |
|
$ |
11,220 |
|
$ |
4,393 |
|
$ |
22,477 |
|
$ |
4,393 |
|
(1) This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of this press release. |
(2) Copper equivalent payable pounds for the purpose of cash cost and AISC were calculated using the following realized prices: |
Q2 2024: |
Q1 2024: |
Q2 2023: |
H1 2024: |
H1 2023: |
Q2 2024 Operational Highlights
-
Consolidated quarterly throughput during Q2 2024 was 627,015 tonnes. On a year-to-date basis, consolidated throughput is
8% higher in 2024 than in 2023, mainly driven by the stabilization and ramp up of Bolivar. - Lower grades at Yauricocha for Q2 2024 compared to Q1 2024 and Q2 2023 were partially compensated for by the increase in throughput. Lower grades from Yauricocha were primarily due to the limited available ore above the 1120 level. The Company expects that grades and throughput will improve from the current levels as the development below 1120 level progresses.
- In Q2 2024, Bolivar experienced a decrease in throughput and grades as compared to Q1 2024 and Q2 2023. The lower throughput rates in Q2 2024 were a result of the planned maintenance downtime required for the commissioning of the new primary crusher and due to lower water availability as a dry season hit the region, which has been resolved as the rainy season has commenced.
-
Yauricocha’s cash cost per copper equivalent payable pound(1) was
$3.44 $3.38 $3.79 $3.85 23% decrease in copper equivalent payable pounds. The decrease in the Q2 2024 AISC resulted from41% lower capital expenditure when compared to Q2 2023. -
Bolivar’s cash cost per copper equivalent payable pound(1) was
$2.76 $2.22 $3.53 $2.97 21% decrease in copper equivalent payable pounds; therefore, leading to higher unit costs when compared to Q1 2024 and Q2 2023.
Q2 2024 Consolidated Financial Highlights
-
Revenue from metals payable of
$57.5 million 2% decrease from the Q2 2023 revenue of$58.4 million 9% from the prior quarter. -
Cash and cash equivalents of
$22.5 million 150% when compared to the$9.1 million $23.8 million $18.2 million $24.2 million $3.9 million
(1) This is a non-IFRS performance measure, see non-IFRS Performance Measures section of this press release |
H1 ACHIEVEMENTS AND COMPARISON TO 2024 GUIDANCE
During the first half of 2024, the Company successfully achieved the following major targets, which in the Management’s opinion has laid the foundation for its future growth:
-
In February 2024, the Company obtained the government’s permit to develop and operate below the 1120 level at the Yauricocha Mine. This permit provides several significant catalysts for Sierra Metals, such as operational enhancements, maximized operating capacity, and cost efficiencies. Using a modest development capital investment, the Company anticipates ramping up to full production levels of 3,600 tonnes per day (“tpd”) (
40% higher than current levels) by Q4 2024. - On May 7, 2024, the Company announced the results of an updated mineral reserves and resources under National Instrument 43-101 (“NI 43-101”) for both its mines. These updated results reconfirm the presence of substantial reserves and resources in both mines. Additionally, this is a relevant indicator that the Company has been able to convert resources to reserves replacing what has been mined throughout the years. The Company filed the corresponding NI 43-101 technical reports on June 20, 2024, which are available on SEDAR+ and the Company’s website.
-
On June 3, 2024, the Company signed a new credit agreement with a syndicate of banks, led by Banco Santander Peru S.A (“Santander”, together with the other banks referred as “lenders” or “the syndicate”), for a senior secured credit facility (“New Facility”) of
$95.0 million $75.0 million Peru (“BCP”) and Santander. The additional$20.0 million Peru , which is expected to commence operations in early 2025, as well as mine developments of over 8,000 meters, a new ore pass, and the initial engineering works on a new tailings dam facility at Bolivar.
After the end of Q2 2024, the Company also completed the sale of the Cusi Mine and the surrounding mineral concessions (please refer to ‘note 17 – subsequent events’ to the financial statements for the six months ended June 30, 2024). Apart from adding
Additionally, the Company will continue with the construction of the new tailings dam at Bolivar, which is expected to be completed over the next three years, allowing the mine to increase its production capacity to 7,500 tpd in the future.
Despite reduced production during Q2 2024, metal production for H1 2024 remained within anticipated the levels. With the development activities below the 1120 level at Yauricocha progressing as planned, the Company remains on track to achieve its previously announced production, costs, and capital expenditure guidance for 2024. The tables below compare the 2024 production versus annual production guidance from the Yauricocha and the Bolivar mines.
Production Guidance
| Consolidated | 2024 Guidance | H1 2024 | |||||
| Low | High | Actual | |||||
| Copper (000 lbs) | 37,500 |
43,300 |
19,778 |
||||
| Zinc (000 lbs) | 38,600 |
44,500 |
21,404 |
||||
| Silver (000 oz) | 1,500 |
1,750 |
814 |
||||
| Gold (oz) | 10,100 |
11,600 |
7,943 |
||||
| Lead (000 lbs) | 10,200 |
11,800 |
6,102 |
||||
By Mine
| Yauricocha | 2024 Guidance | H1 2024 | |||||
| Low | High | Actual | |||||
| Copper (000 lbs) | 13,600 |
15,700 |
5,671 |
||||
| Zinc (000 lbs) | 38,600 |
44,500 |
21,404 |
||||
| Silver (000 oz) | 850 |
1,000 |
420 |
||||
| Gold (oz) | 2,100 |
2,400 |
936 |
||||
| Lead (000 lbs) | 10,200 |
11,800 |
6,102 |
||||
| Bolivar | 2024 Guidance | H1 2024 | |||||
| Low | High | Actual | |||||
| Copper (000 lbs) | 23,900 |
27,600 |
14,107 |
||||
| Silver (000 oz) | 650 |
750 |
394 |
||||
| Gold (oz) | 8,000 |
9,200 |
7,007 |
||||
2024 Cost Guidance
A per mine breakdown of 2024 production guidance, cash costs, and AISC are included in the table below. Starting 2024, the Company modified its definition of cash cost to include treatment and refining charges, selling costs and, site G&A costs. AISC includes cash costs and sustaining capital expenditure and is calculated on the basis of copper equivalent payable pounds.
2024 Guidance |
|
H1 Actual |
||||||||
Cash costs(1)(2) range |
AISC(1)(2) range |
Cash costs(1)(2) |
AISC(1)(2) |
|||||||
| Mine | per CuEqLb |
per CuEqLb |
per CuEqLb |
per CuEqLb |
||||||
| Yauricocha | Per Copper Payable Eq Lbs ('000) |
|
|
|
|
|||||
| Bolivar | Per Copper Payable Eq Lbs ('000) |
|
|
|
|
|||||
(1) This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of this press release. Cash Cost comprises operating costs, selling expenses, administrative expenses, commercial terms and discounts. AISC is comprised of cash costs and sustaining capex. |
(2) Copper equivalent payable pounds for guidance AISC were calculated using the following metal prices: |
NON-IFRS PERFORMANCE MEASURES
The following table provides a reconciliation of adjusted EBITDA to the condensed interim consolidated financial statements for the three months and six months ended June 30, 2024 and 2023:
Three months ended June 30, |
|
Six months ended June 30, |
||||||||||||||
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
||
| Net income | $ |
4,102 |
|
$ |
1,073 |
|
$ |
4,867 |
|
$ |
3,212 |
|
||||
| Adjusted for: | ||||||||||||||||
| Depletion and depreciation |
|
8,194 |
|
|
9,267 |
|
|
17,828 |
|
|
16,810 |
|
||||
| Interest expense and other finance costs |
|
2,742 |
|
|
2,788 |
|
|
5,147 |
|
|
4,987 |
|
||||
| NRV adjustments on inventory |
|
- |
|
|
1,079 |
|
|
- |
|
|
1,555 |
|
||||
| Share-based compensation |
|
800 |
|
|
86 |
|
|
1,434 |
|
|
188 |
|
||||
| Foreign currency exchange and other provisions |
|
(1,309 |
) |
|
689 |
|
|
855 |
|
|
2,061 |
|
||||
| Income taxes |
|
(2,390 |
) |
|
(1,456 |
) |
|
(944 |
) |
|
(82 |
) |
||||
| Adjusted EBITDA | $ |
12,139 |
|
$ |
13,526 |
|
$ |
29,187 |
|
$ |
28,731 |
|
||||
| Less: Adjusted EBITDA from discontinued operations |
|
(810 |
) |
|
(968 |
) |
|
(1,675 |
) |
|
(1,245 |
) |
||||
| Adjusted EBITDA from continuing operations |
|
12,949 |
|
|
14,494 |
|
|
30,862 |
|
|
29,976 |
|
||||
The following table provides a reconciliation of adjusted net income to the condensed interim consolidated financial statements for the three months and six months ended June 30, 2024 and 2023:
Three months ended June 30, |
|
Six months ended June 30, |
|||||||||||||
| (In thousands of |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
| Net income attributable to shareholders | $ |
4,115 |
|
$ |
1,638 |
|
$ |
5,274 |
|
$ |
3,691 |
|
|||
| Non-cash depletion charge on Corona's acquisition |
|
455 |
|
$ |
1,175 |
|
|
1,500 |
|
|
2,245 |
|
|||
| Deferred tax recovery on Corona's acquisition depletion charge |
|
151 |
|
$ |
(359 |
) |
|
(542 |
) |
|
(686 |
) |
|||
| NRV adjustments on inventory |
|
- |
|
$ |
1,079 |
|
|
- |
|
|
1,555 |
|
|||
| Share-based compensation |
|
800 |
|
$ |
86 |
|
|
1,434 |
|
|
188 |
|
|||
| Foreign currency exchange loss (gain) |
|
(1,309 |
) |
$ |
689 |
|
|
855 |
|
|
2,061 |
|
|||
| Adjusted net income (loss) attributable to shareholders | $ |
4,212 |
|
$ |
4,308 |
|
$ |
8,521 |
|
$ |
9,054 |
|
|||
| Less: Adjusted net loss from discontinued operations |
|
(810 |
) |
|
(1,676 |
) |
|
(1,675 |
) |
|
(2,471 |
) |
|||
| Adjusted net income (loss) from continuing operations |
|
5,022 |
|
|
5,984 |
|
|
10,196 |
|
|
11,525 |
|
|||
The following table provides a reconciliation of cash costs to cost of sales, as reported in the Company’s condensed interim consolidated statement of income for the three months and six months ended June 30, 2024 and 2023:
| Three months ended | Three months ended | |||||||||||
| (In thousand of US dollars, unless stated) | June 30, 2024 | June 30, 2023 | ||||||||||
| Yauricocha | Bolivar | Yauricocha | Bolivar | |||||||||
| Cash Cost per Tonne of Processed Ore | ||||||||||||
| Cost of Sales | 21,400 |
|
20,847 |
|
24,630 |
|
19,439 |
|
||||
| Reverse: Workers Profit Sharing | - |
|
105 |
|
- |
|
- |
|
||||
| Reverse: D&A/Other adjustments | (5,687 |
) |
(4,138 |
) |
(5,648 |
) |
(3,414 |
) |
||||
| Reverse: Variation in Inventory | 5,318 |
|
(673 |
) |
718 |
|
850 |
|
||||
| Total Cash Cost | 21,031 |
|
16,141 |
|
19,700 |
|
16,875 |
|
||||
| Tonnes Processed | 253,148 |
|
373,867 |
|
244,315 |
|
405,987 |
|
||||
| Cash Cost per Tonne Processed | US$ | 83.08 |
|
43.17 |
|
80.63 |
|
41.57 |
|
|||
| Six months ended | Six months ended | |||||||||||
| (In thousand of US dollars, unless stated) | June 30, 2024 | June 30, 2023 | ||||||||||
| Yauricocha | Bolivar | Yauricocha | Bolivar | |||||||||
| Cash Cost per Tonne of Processed Ore | ||||||||||||
| Cost of Sales | 45,263 |
|
43,035 |
|
46,522 |
|
34,371 |
|
||||
| Reverse: Workers Profit Sharing | - |
|
(497 |
) |
- |
|
- |
|
||||
| Reverse: D&A/Other adjustments | (11,679 |
) |
(6,604 |
) |
(10,771 |
) |
(5,715 |
) |
||||
| Reverse: Variation in Inventory | 5,624 |
|
(347 |
) |
1,126 |
|
1,374 |
|
||||
| Total Cash Cost | 39,208 |
|
35,587 |
|
36,877 |
|
30,030 |
|
||||
| Tonnes Processed | 493,834 |
|
772,097 |
|
463,460 |
|
705,004 |
|
||||
| Cash Cost per Tonne Processed | US$ | 79.40 |
|
46.09 |
|
79.57 |
|
42.60 |
|
|||
The following table provides detailed information on Yauricocha’s cash cost and all-in sustaining cost per copper equivalent payable pound for the three months and six months ended June 30, 2024 and 2023:
| YAURICOCHA | Three months ended | Six months ended | ||||||||||
| (In thousand of US dollars, unless stated) | June 30, 2024 | June 30, 2023 | June 30, 2024 | June 30, 2023 | ||||||||
| Cash Cost per zinc equivalent payable pound | ||||||||||||
| Total Cash Cost | 21,031 |
|
19,700 |
|
39,208 |
|
36,877 |
|
||||
| Variation in Finished inventory | (5,318 |
) |
(718 |
) |
(5,624 |
) |
(1,126 |
) |
||||
| Treatment and Refining Charges | 4,009 |
|
6,697 |
|
9,634 |
|
11,438 |
|
||||
| Selling Costs | 710 |
|
803 |
|
1,350 |
|
1,418 |
|
||||
| G&A Costs(1) | 1,616 |
|
1,487 |
|
3,136 |
|
3,127 |
|
||||
| Total Cash Cost of Sales | 22,048 |
|
27,969 |
|
47,704 |
|
51,734 |
|
||||
| Sustaining Capital Expenditures | 2,252 |
|
3,897 |
|
4,098 |
|
4,941 |
|
||||
| All-In Sustaining Cash Costs | 24,300 |
|
31,866 |
|
51,802 |
|
56,675 |
|
||||
| Copper Equivalent Payable |
6,409 |
|
8,279 |
|
14,370 |
|
16,516 |
|
||||
| Cash Cost per Copper Equivalent Payable Pound | (US$) | 3.44 |
|
3.38 |
|
3.32 |
|
3.13 |
|
|||
| All-In Sustaining Cash Cost per Copper Equivalent Payable Pound | (US$) | 3.79 |
|
3.85 |
|
3.60 |
|
3.43 |
|
|||
(1) G&A Costs for the three months and six months ended June 30, 2023 have been adjusted to include site G&A only. Allocation of corporate G&A costs have been excluded for consistency with the G&A costs for the three months and six months ended June 30, 2024 and those used in the 2024 guidance cash costs and AISC. |
(2) Copper equivalent payable pounds were calculated using the following realized prices: |
Q2 2024: |
Q2 2023: |
6M 2024: |
6M 2023: |
The following table provides detailed information on Bolivar’s cash cost, and all-in sustaining cost per copper equivalent payable pound for the three months and six months ended June 30, 2024 and 2023:
| BOLIVAR | Three months ended | Six months ended | ||||||||||
| (In thousand of US dollars, unless stated) | June 30, 2024 | June 30, 2023 | June 30, 2024 | June 30, 2023 | ||||||||
| Cash Cost per copper equivalent payable pound | ||||||||||||
| Total Cash Cost | 16,141 |
|
16,875 |
|
35,587 |
|
30,030 |
|
||||
| Variation in Finished inventory | 673 |
(850 |
) |
347 |
(1,374 |
) |
||||||
| Treatment and Refining Charges | 1,856 |
|
2,819 |
|
4,710 |
|
4,984 |
|
||||
| Selling Costs | 1,976 |
|
2,335 |
|
4,615 |
|
3,871 |
|
||||
| G&A Costs(1) | 1,019 |
|
853 |
|
2,576 |
|
1,873 |
|
||||
| Total Cash Cost of Sales | 21,665 |
|
22,032 |
|
47,835 |
|
39,384 |
|
||||
| Sustaining Capital Expenditures | 6,022 |
|
7,350 |
|
13,405 |
|
10,898 |
|
||||
| All-In Sustaining Cash Costs | 27,687 |
|
29,382 |
|
61,240 |
|
50,282 |
|
||||
| Copper Equivalent Payable |
7,841 |
|
9,908 |
|
18,734 |
|
16,726 |
|
||||
| Cash Cost per Copper Equivalent Payable Pound | (US$) | 2.76 |
|
2.22 |
|
2.55 |
|
2.35 |
|
|||
| All-In Sustaining Cash Cost per Copper Equivalent Payable Pound | (US$) | 3.53 |
|
2.97 |
|
3.27 |
|
3.01 |
|
|||
(1) G&A Costs for the three months and six months ended June 30, 2023 have been adjusted to include site G&A only. Allocation of corporate G&A costs have been excluded for consistency with the G&A costs for the three months and six months ended June 30, 2024 and those used in the 2024 guidance cash costs and AISC. |
(2) Copper equivalent payable pounds were calculated using the following realized prices: |
Q2 2024: |
Q2 2023: |
6M 2024: |
6M 2023: |
The non-IFRS performance measures presented do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be directly comparable to similar measures presented by other issuers.
Non-IFRS reconciliation of adjusted EBITDA
EBITDA is a non-IFRS measure that represents an indication of the Company’s continuing capacity to generate earnings from operations before taking into account management’s financing decisions and costs of consuming capital assets, which vary according to their vintage, technological currency, and management’s estimate of their useful life. EBITDA comprises revenue less operating expenses before interest expense (income), property, plant and equipment amortization and depletion, and income taxes. Adjusted EBITDA has been included in this document. Under IFRS, entities must reflect in compensation expense the cost of share-based payments. In the Company’s circumstances, share-based payments involve a significant accrual of amounts that will not be settled in cash but are settled by the issuance of shares in exchange for cash. As such, the Company has made an entity specific adjustment to EBITDA for these expenses. The Company has also made an entity-specific adjustment to the foreign currency exchange (gain)/loss. The Company considers cash flow before movements in working capital to be the IFRS performance measure that is most closely comparable to adjusted EBITDA.
Non-IFRS reconciliation of adjusted net income
The Company has included the non-IFRS financial performance measure of adjusted net income, defined by management as the net income attributable to shareholders shown in the statement of earnings plus the non-cash depletion charge due to the acquisition of Corona and the corresponding deferred tax recovery and certain non-recurring or non-cash items such as share-based compensation and foreign currency exchange (gains) losses. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors may want to use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance in accordance with IFRS.
Cash cost per copper equivalent payable pound
The Company uses the non-IFRS measure of cash cost per copper equivalent payable pound to manage and evaluate operating performance. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The Company considers cost of sales per copper equivalent payable pound to be the most comparable IFRS measure to cash cost per copper equivalent payable pound and has included calculations of this metric in the reconciliations within the applicable tables to follow.
All-in sustaining cost per copper equivalent payable pound
AISC is a non‐IFRS measure and is calculated based on guidance provided by the World Gold Council (“WGC”). WGC is not a regulatory industry organization and does not have the authority to develop accounting standards for disclosure requirements. Other mining companies may calculate AISC differently as a result of differences in underlying accounting principles and policies applied, as well as differences in definitions of sustaining versus development capital expenditures.
AISC is a more comprehensive measure than cash cost per pound for the Company’s consolidated operating performance by providing greater visibility, comparability and representation of the total costs associated with producing copper from its current operations.
The Company defines sustaining capital expenditures as, “costs incurred to sustain and maintain existing assets at current productive capacity and constant planned levels of productive output without resulting in an increase in the life of assets, future earnings, or improvements in recovery or grade. Sustaining capital includes costs required to improve/enhance assets to minimum standards for reliability, environmental or safety requirements. Sustaining capital expenditures excludes all expenditures at the Company’s new projects and certain expenditures at current operations which are deemed expansionary in nature.”
Consolidated AISC includes total production cash costs incurred at the Company’s mining operations, including treatment and refining charges and selling costs, which forms the basis of the Company’s total cash costs. Additionally, the Company includes sustaining capital expenditures and corporate general and administrative expenses. AISC by mine does not include certain corporate and non‐cash items such as general and administrative expense and share-based payments. The Company believes that this measure represents the total sustainable costs of producing copper from current operations and provides the Company and other stakeholders of the Company with additional information of the Company’s operational performance and ability to generate cash flows. As the measure seeks to reflect the full cost of copper production from current operations, new project capital and expansionary capital at current operations are not included. Certain other cash expenditures, including tax payments, dividends and financing costs are also not included.
Additional non-IFRS measures
The Company uses other financial measures, the presentation of which is not meant to be a substitute for other subtotals or totals presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. The following other financial measures are used:
- Operating cash flows before movements in working capital - excludes the movement from period-to-period in working capital items including trade and other receivables, prepaid expenses, deposits, inventories, trade and other payables and the effects of foreign exchange rates on these items.
The terms described above do not have a standardized meaning prescribed by IFRS, and therefore the Company’s definitions are unlikely to be comparable to similar measures presented by other companies. The Company’s management believes that their presentation provides useful information to investors because cash flows generated from operations before changes in working capital excludes the movement in working capital items. This, in management’s view, provides useful information of the Company’s cash flows from operations and are considered to be meaningful in evaluating the Company’s past financial performance or its future prospects. The most comparable IFRS measure is cash flows from operating activities.
About Sierra Metals
Sierra Metals is a Canadian mining company focused on copper production with additional base and precious metals by-product credits at its Yauricocha Mine in
For further information regarding Sierra Metals, please visit www.sierrametals.com.
Forward-Looking Statements
This press release contains forward-looking information within the meaning of Canadian securities legislation. Forward-looking information relates to future events or the anticipated performance of Sierra and reflect management's expectations or beliefs regarding such future events and anticipated performance based on an assumed set of economic conditions and courses of action. In certain cases, statements that contain forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur" or "be achieved" or the negative of these words or comparable terminology. By its very nature forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual performance of Sierra to be materially different from any anticipated performance expressed or implied by such forward-looking information.
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 March 15, 2024 for its fiscal year ended December 31, 2023 and other risks identified in the Company's filings with Canadian securities regulators, which are available at www.sedarplus.ca.
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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240809352190/en/
Investor Relations
Sierra Metals Inc.
+1 (866) 721-7437
info@sierrametals.com
Source: Sierra Metals Inc.
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