TSX: SLW NYSE: SLW VANCOUVER, Nov. 9 /PRNewswire-FirstCall/ --
Silver Wheaton Corp. (TSX, NYSE:SLW) today announced its unaudited
results for the third quarter ended September 30, 2009. THIRD
QUARTER HIGHLIGHTS
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- Record attributable production of 4.3 million silver equivalent
ounces (4.0 million ounces of silver and 3,698 ounces of gold) at a
total cash cost of US$3.97(1) per silver ounce, representing an
increase of 59% over the comparable period in 2008. - Record silver
equivalent sales of 4.6 million ounces (4.0 million ounces of
silver and 9,953 ounces of gold), representing an increase of 70%
over the comparable period in 2008. - As of the end of the third
quarter, approximately 1.0 million silver equivalent payable ounces
attributable to the Company have been produced at the various mines
and will be recognized in future sales as they are delivered to the
Company under the terms of their contracts. - Record net earnings
of US$33.6 million (US$0.11 per share) compared to US$20.2 million
(US$0.09 per share) for the comparable period in 2008. - Record
operating cash flows of US$45.4 million (US$0.14 per share)
compared to US$26.7 million (US$0.11 per share) for the comparable
period in 2008. - Entered into an agreement with Barrick Gold
Corporation ("Barrick") to acquire 25% of the life of mine silver
production from its Pascua-Lama project, as well as 100% of the
silver production from its Lagunas Norte, Pierina and Veladero
mines until the end of 2013. Silver Wheaton will make total upfront
cash payments of US$625 million payable in installments, of which
US$212.5 million has been paid to date. The remaining US$412.5
million is payable in annual installments of US$137.5 million due
on the first, second and third anniversaries of the transaction.
The acquisition is forecast to add average annualized silver
production of approximately 2.4 million ounces until Pascua-Lama
commences production in 2013, at which time average annual silver
production is forecast to increase by approximately 9 million
ounces for the first five years of Pascua-Lama's 25 year mine life.
- In conjunction with the Barrick acquisition, closed a bought deal
equity financing, raising gross proceeds of US$287.5 million.
Subsequent to September 30, 2009, US$140 million of the net
proceeds were used to repay a temporary draw under the Company's
revolving bank debt facility, which was utilized to partially
finance the initial upfront payment made to Barrick. The remaining
proceeds from the equity financing, together with the US$400
million of available credit under the Company's revolving bank debt
facility, are available to fund further silver stream acquisitions.
- On November 4, 2009, Goldcorp Inc. ("Goldcorp") announced that
they have commenced shipments of the first silver-bearing lead and
zinc concentrates produced at their Penasquito mine in Mexico with
preliminary metals grades, recoveries and concentrate quality
meeting or exceeding expectations. Annual production attributable
to Silver Wheaton from Penasquito is expected to average
approximately 7.2 million ounces of silver over the estimated 22
year mine life. (1) Refer to discussion on non-GAAP measures at the
end of this press release "It is very pleasing to report record
attributable silver production, sales, earnings and cash flows,
just as Penasquito is poised to start driving further significant
growth over the next few years," said Peter Barnes, President and
Chief Executive Officer of Silver Wheaton. "On top of that, the
Barrick silver stream acquisition, which was completed in the third
quarter, will increase our long term growth profile significantly,
solidifying Silver Wheaton's status as the largest of all metals
streaming and royalty companies in the world." "We are now
partnered with the world's two largest gold companies, Barrick and
Goldcorp, and have a significant interest in what are forecast to
be two of the world's biggest silver producing mines, the
Pascua-Lama mine straddling the border of Chile and Argentina and
the Penasquito mine in Mexico. Penasquito, the first of these
cornerstone growth assets to commence production, continues its
successful ramp up and the mine has now begun shipping
silver-bearing concentrates with preliminary metal grades and
recoveries meeting or exceeding expectations. Furthermore, given
the US$400 million of available credit under our revolving bank
debt facility and over US$165 million of cash on hand, we are very
well positioned to pursue additional accretive acquisitions." This
earnings release should be read in conjunction with Silver
Wheaton's MD&A and Financial Statements, which are available on
the Company's website at http://www.silverwheaton.com/ and have
been posted on SEDAR at http://www.sedar.com/. Conference Call
Details A conference call will be held Tuesday, November 10, 2009,
starting at 11:00 am (Eastern Time) to discuss these results. To
participate in the live call use one of the following methods: Dial
toll free from Canada or the US: 1-888-231-8191 Dial from outside
Canada or the US: 1-647-427-7450 Pass code: 34932154 Live audio
webcast: http://www.silverwheaton.com/ Participants should dial in
five to ten minutes before the call. The conference call will be
recorded and you can listen to an archive of the call by one of the
following methods: Dial toll free from Canada or the US:
1-800-642-1687 Dial from outside Canada or the US: 1-416-849-0833
Pass code: 34932154 Archived audio webcast:
http://www.silverwheaton.com/ About Silver Wheaton Silver Wheaton
is the largest silver streaming company in the world. Forecast 2009
production is 16 million ounces of silver and 17,000 ounces of
gold, for total production of 17 million silver equivalent ounces.
By 2013, annual production is anticipated to more than double to
approximately 39 million ounces of silver and 20,000 ounces of
gold, for total production of approximately 40 million silver
equivalent ounces. This growth is driven by the Company's portfolio
of world-class assets, including silver streams on Goldcorp's
Penasquito mine and Barrick's Pascua-Lama project. CAUTIONARY NOTE
REGARDING FORWARD LOOKING-STATEMENTS The information contained
herein contains "forward-looking statements" within the meaning of
the United States Private Securities Litigation Reform Act of 1995
and applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to, statements with respect
to the future price of silver, the estimation of mineral reserves
and resources, the realization of mineral reserve estimates, the
timing and amount of estimated future production, costs of
production, reserve determination and reserve conversion rates.
Generally, these forward-looking statements can be identified by
the use of forward-looking terminology such as "plans", "expects"
or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "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". Forward-looking statements are subject to known and
unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements of
Silver Wheaton to be materially different from those expressed or
implied by such forward-looking statements, including but not
limited to: fluctuations in the price of silver, the absence of
control over mining operations from which Silver Wheaton purchases
silver and risks related to these mining operations, including
risks related to fluctuations in the price of the primary
commodities mined at such operations, changes in laws and
regulations including taxation policies, actual results of mining
and exploration activities, changes in project parameters as plans
continue to be refined, as well as those factors discussed in the
section entitled "Description of the Business - Risk Factors" in
Silver Wheaton's Annual Information Form available on SEDAR at
http://www.sedar.com/ and in Silver Wheaton's Form 40-F on file
with the U.S. Securities and Exchange Commission in Washington,
D.C. Forward-looking statements are based on assumptions management
believes to be reasonable, including but not limited to: the
continued operation of the mining operations from which Silver
Wheaton purchases silver, no material adverse change in the market
price of commodities, that the mining operations will operate and
the mining projects will be completed in accordance with their
public statements and achieve their stated production outcomes, and
such other assumptions and factors as may be set out herein.
Although Silver Wheaton has attempted to identify important factors
that could cause actual results to differ materially from those
contained in forward-looking statements, there may be other factors
that cause results not to be as anticipated, estimated or intended.
There can be no assurance that such statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. Silver Wheaton does not undertake to update any
forward-looking statements that are incorporated by reference
herein, except in accordance with applicable securities laws.
Consolidated Statement of Operations (unaudited) (US dollars and
shares in thousands, Three Months Ended Nine Months Ended except
per September 30 September 30 share amounts
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unaudited) Note 2009 2008 2009 2008
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Sales $ 69,767 $ 39,371 $ 148,742 $ 137,994
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Cost of sales 18,765 10,677 43,069 33,033 Depletion 13,164 5,152
26,170 14,443
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31,929 15,829 69,239 47,476
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Earnings from operations 37,838 23,542 79,503 90,518
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Expenses and other income General and administrative(1) 3,906 3,589
12,917 13,850 Debt issue costs - - - 601 Loss (gain) on
mark-to-market of warrants held - 100 (33) 1,047 Other 366 (388)
(496) (283)
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4,272 3,301 12,388 15,215
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Earnings before tax 33,566 20,241 67,115 75,303 Future income tax
expense - - - 3,858
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Net earnings $ 33,566 $ 20,241 $ 67,115 $ 71,445
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(1) Stock based compensation (a non-cash item) included in general
and administrative $ 623 $ 1,078 $ 3,312 $ 4,538 Basic earnings per
share $ 0.11 $ 0.09 $ 0.23 $ 0.32 Diluted earnings per share $ 0.11
$ 0.08 $ 0.23 $ 0.29 Weighted average number of shares outstanding
Basic 313,445 232,710 294,208 226,598 Diluted 317,431 249,010
297,936 249,833
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Consolidated Balance Sheets (unaudited)
-------------------------------- September 30 December 31 (US
dollars in thousands - unaudited) Note 2009 2008
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Assets Current Cash and cash equivalents $ 304,858 $ 7,110 Accounts
receivable 5,497 772 Other 667 816
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311,022 8,698 Long-term investments 49,766 21,840 Silver and gold
interests 1,937,378 1,238,368 Other 1,604 1,740
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$ 2,299,770 $ 1,270,646
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Liabilities Current Accounts payable $ 1,722 $ 1,396 Accrued
liabilities 6,285 3,425 Current portion of bank debt 168,760 28,560
Current portion of silver interest payments due 128,625 -
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305,392 33,381 Bank debt 114,320 349,240 Silver interest payments
due 232,879 -
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652,591 382,621
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Shareholders' Equity Issued capital and contributed surplus
1,326,369 662,115
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Retained earnings 293,025 225,910 Accumulated other comprehensive
income 27,785 -
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320,810 225,910
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1,647,179 888,025
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$ 2,299,770 $ 1,270,646
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Consolidated Statement of Cash Flows (unaudited) Three Months Ended
Nine Months Ended (US dollars September 30 September 30 in
thousands - ---------------------------------------------------
unaudited) 2009 2008 2009 2008
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Operating Activities Net earnings $ 33,566 $ 20,241 $ 67,115 $
71,445 Items not affecting cash Depreciation and depletion 13,229
5,152 26,359 14,443 Future income tax expense - - - 3,858 Stock
based compensation 623 1,078 3,312 4,538 Loss (gain) on
mark-to-market of warrants held - 100 (33) 1,047 Other (338) (281)
(148) (244) Change in non-cash operating working capital (1,700)
435 (1,652) 609
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Cash generated by operating activities 45,380 26,725 94,953 95,696
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Financing Activities Bank debt drawn down 140,200 18,000 140,200
183,500 Bank debt repaid (7,140) (131,040) (234,920) (223,620)
Shares issued 287,531 - 517,955 - Share issue costs (11,645)
(1,159) (21,620) (1,183) Warrants exercised 10,345 113,463 10,508
115,785 Share purchase options exercised 4,200 580 5,789 2,640
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Cash generated by (applied to) financing activities 423,491 (156)
417,912 77,122
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Investing Activities Silver interests (213,819) (44,958) (218,466)
(164,008) Acquisition of Silverstone Resources Corp., net of cash
acquired (261) - 2,407 - Other 1,599 (4,044) 1,615 (4,572)
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Cash applied to investing activities (212,481) (49,002) (214,444)
(168,580)
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Effect of exchange rate changes on cash and cash equivalents (122)
463 (673) 459
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Increase (decrease) in cash and cash equivalents 256,268 (21,970)
297,748 4,697 Cash and cash equivalents, beginning of period 48,590
36,632 7,110 9,965
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Cash and cash equivalents, end of period $ 304,858 $ 14,662 $
304,858 $ 14,662
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Results of Operations (unaudited) Nine Months Ended September 30,
2009
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Average realized price Ounces Ounces ($'s per produced(2) sold
Sales ounce)
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Silver (000's) Luismin 4,016 4,034 $ 55,701 $ 13.81 Zinkgruvan
1,356 1,353 19,023 14.06 Yauliyacu 2,359 1,987 26,881 13.53
Stratoni 699 690 8,780 12.71 Penasquito 487 455 6,106 13.42 Campo
Morado 610 305 4,180 13.67 Minto 84 67 1,036 15.31 Cozamin 628 597
8,671 14.53 Barrick(4) 223 187 3,008 16.07 Other(5) 638 395 5,648
14.28 Corporate
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11,100 10,070 $ 139,034 $ 13.80 Gold Minto 10,521 10,098 $ 9,708 $
961
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Silver Equivalent (000's)(6) 11,761 10,708 $ 148,742 $ 13.89
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Nine Months Ended September 30, 2009
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Total Total cash cost depletion Net Cash flow ($'s per ($'s per
earnings from ounce)(3) ounce) (loss) operations
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Silver (000's) Luismin $ 4.02 $ 0.71 $ 36,609 $ 39,483 Zinkgruvan
4.02 1.78 11,175 12,793 Yauliyacu 3.93 3.47 12,184 19,082 Stratoni
3.90 3.59 3,605 6,201 Penasquito 3.90 2.35 3,260 4,331 Campo Morado
3.90 4.85 1,506 2,987 Minto 3.90 4.48 469 808 Cozamin 4.00 4.70
3,479 7,617 Barrick(4) 3.90 3.46 1,631 2,278 Other(5) 3.90 5.80
1,812 3,765 Corporate (12,388) (9,914)
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$ 3.97 $ 2.31 $ 63,342 $ 89,431 Gold Minto $ 300 $ 288 $ 3,773 $
5,522
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Silver Equivalent (000's)(6) $ 4.02 $ 2.44 $ 67,115 $ 94,953
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(1) Ounces produced represent the quantity of silver and gold
contained in concentrate or dore prior to smelting or refining
deductions. (2) Certain production figures are based on management
estimates. (3) Refer to discussion on non-GAAP measures at the end
of this press release (4) Comprised of Lagunas Norte, Pierina and
Veladero mines. (5) Comprised of La Negra, Mineral Park and
Neves-Corvo mines. (6) Gold ounces produced and sold are converted
to a silver equivalent basis on the ratio of the average silver
price received to the average gold price received during the
period. Nine Months Ended September 30, 2008
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Average realized price Ounces Ounces ($'s per produced sold Sales
ounce)
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Silver (000's) Luismin 3,938 4,123 $ 68,028 $ 16.50 Zinkgruvan
1,321 1,260 20,523 16.26 Yauliyacu 2,397 2,175 36,346 16.71
Stratoni 803 685 10,868 15.87 Penasquito 141 98 1,451 14.74 Campo
Morado 12 - - - Other(3) 86 58 778 13.33 Corporate
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8,698 8,399 $ 137,994 $ 16.43
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Nine Months Ended September 30, 2008
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Total Total cash cost depletion Net Cash flow ($'s per ($'s per
earnings from ounce)(2) ounce) (loss) operations
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Silver (000's) Luismin $ 3.95 $ 0.42 $ 50,023 $ 51,746 Zinkgruvan
3.96 1.57 13,563 16,249 Yauliyacu 3.90 3.47 20,310 27,866 Stratoni
3.90 3.69 5,670 8,078 Penasquito 3.90 2.42 830 1,067 Campo Morado -
- - - Other(3) 3.90 7.38 122 828 Corporate (19,073) (10,138)
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$ 3.93 $ 1.72 $ 71,445 $ 95,696
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(1) Ounces produced represent the quantity of silver contained in
concentrate or dore prior to smelting o r refining deductions. (2)
Refer to discussion on non-GAAP measures at the end of this press
release (3) Comprised of La Negra mine. Three Months Ended
September 30, 2009
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Average realized price Ounces Ounces ($'s per produced(2) sold
Sales ounce)
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Silver (000's) Luismin 1,308 1,310 $ 20,053 $ 15.30 Zinkgruvan 415
433 6,861 15.85 Yauliyacu 750 698 10,600 15.19 Stratoni 229 342
4,826 14.10 Penasquito 165 190 2,691 14.15 Campo Morado 225 170
2,458 14.42 Minto 46 68 1,043 15.29 Cozamin 366 384 5,736 14.94
Barrick(4) 223 187 3,008 16.07 Other(5) 305 192 2,918 15.21
Corporate
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4,032 3,974 $ 60,194 $ 15.14 Gold Minto 3,698 9,953 $ 9,573 $ 962
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Silver Equivalent (000's)(6) 4,265 4,600 $ 69,767 $ 15.16
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Three Months Ended September 30, 2009
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Total Total cash cost depletion Net Cash flow ($'s per ($'s per
earnings from ounce)(3) ounce) (loss) operations
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Silver (000's) Luismin $ 4.02 $ 0.65 $ 13,929 $ 14,785 Zinkgruvan
4.02 1.78 4,350 4,415 Yauliyacu 3.94 3.47 5,426 7,849 Stratoni 3.90
3.50 2,292 3,368 Penasquito 3.90 2.36 1,502 1,950 Campo Morado 3.90
4.83 969 1,793 Minto 3.90 4.48 472 794 Cozamin 4.00 4.72 2,389
4,229 Barrick(4) 3.90 3.46 1,631 2,278 Other(5) 3.90 5.29 1,154
1,377 Corporate (4,272) (2,788)
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$ 3.97 $ 2.59 $ 29,842 $ 40,050 Gold Minto $ 300 $ 288 $ 3,724 $
5,330
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Silver Equivalent (000's)(6) $ 4.08 $ 2.86 $ 33,566 $ 45,380
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(1) Ounces produced represent the quantity of silver and gold
contained in concentrate or dore prior to smelting or refining
deductions. (2) Certain production figures are based on management
estimates. (3) Refer to discussion on non-GAAP measures at the end
of this press release (4) Comprised of Lagunas Norte, Pierina and
Veladero mines. (5) Comprised of La Negra, Mineral Park and
Neves-Corvo mines. (6) Gold ounces produced and sold are converted
to a silver equivalent basis on the ratio of the average silver
price received to the average gold price received during the
period. Three Months Ended September 30, 2008
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Average realized price Ounces Ounces ($'s per produced sold Sales
ounce)
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Silver (000's) Luismin 1,174 1,198 $ 17,496 $ 14.61 Zinkgruvan 371
418 5,436 13.01 Yauliyacu 712 691 10,712 15.50 Stratoni 280 253
3,498 13.85 Penasquito 113 98 1,451 14.74 Campo Morado 12 - - -
Other(3) 69 58 778 13.33 Corporate
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2,731 2,716 $ 39,371 $ 14.50
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Three Months Ended September 30, 2008
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Total Total cash cost depletion Net Cash flow ($'s per ($'s per
earnings from ounce)(2) ounce) (loss) operations
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Silver (000's) Luismin $ 3.95 $ 0.42 $ 12,265 $ 12,766 Zinkgruvan
3.96 1.57 3,127 4,525 Yauliyacu 3.90 3.47 5,616 8,017 Stratoni 3.90
3.68 1,582 2,592 Penasquito 3.90 2.42 830 1,067 Campo Morado - - -
- Other(3) 3.90 7.38 122 828 Corporate (3,301) (3,070)
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$ 3.93 $ 1.90 $ 20,241 $ 26,725
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(1) Ounces produced represent the quantity of silver contained in
concentrate or dore prior to smelting o r refining deductions. (2)
Refer to discussion on non-GAAP measures at the end of this press
release (3) Comprised of La Negra mine. Non-GAAP Measures - Total
Cash Costs Per Ounce Of Silver & Gold Calculation Silver
Wheaton has included, throughout this press release, certain
non-GAAP performance measures, including total cash costs of silver
and gold on a sales basis. These non-GAAP measures do not have any
standardized meaning prescribed by GAAP, nor are they necessarily
comparable with similar measures presented by other companies. Cash
costs are presented as they represent an industry standard method
of comparing certain costs on a per unit basis. The Company
believes that certain investors use this information to evaluate
the Company's performance. The data 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 GAAP. During the three months ended September 30, 2009, the
Company's total cash costs, which were equivalent to the Company's
Cost of Sales in accordance with GAAP, were $3.97 per ounce of
silver and $300 per ounce of gold (2008 - $3.93 per ounce of
silver). DATASOURCE: Silver Wheaton Corp. CONTACT: Brad Kopp,
Director, Investor Relations, Silver Wheaton Corp., Tel:
1-800-380-8687, Email: , Website: http://www.silverwheaton.com/
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