(All metal prices reported in USD)
Sierra Metals Inc. (TSX: SMT) (BVL:SMT) (NYSE AMERICAN:
SMTS) (“Sierra Metals” or “the Company”) reports third quarter 2022
production results and announces its decision to voluntarily delist
its common shares from the New York Stock Exchange American
(“NYSE”) and the Bolsa de Valores de Lima (“BVL”). Delisting is
intended to reduce costs and simplify Sierra’s administrative and
compliance structure associated with these listings. The Company’s
common shares will continue to be listed and traded in Canadian
dollars on the TSX.
Production results are from Sierra Metals’ three underground
mines in Latin America: The Yauricocha polymetallic mine in Peru,
and the Bolivar copper and Cusi silver mines in Mexico.
Third Quarter 2022 Consolidated
Production Highlights
- As a result of the mudslide incident and the community
blockade that followed, mining operations at Yauricocha were
suspended for approximately 20 days in September.
- Consolidated mill throughput decreased 12% when compared to
the previous quarter and 25% when compared to Q3 2021, due to lower
throughput at Yauricocha and slower ramp up at Bolivar as a result
of an unforeseen flooding event in the Bolivar NorthWest
zone.
- Consolidated copper equivalent production was 7% lower
compared to the previous quarter and 24% lower when compared to Q3
2021
- Suspension of production and financial guidance remains in
effect.
Consolidated Q3 2022 Results – The Company previously
announced that results will be released on Tuesday, November 15th
with a shareholder conference call and webcast on Wednesday,
November 16th.
Correction: The Company’s Q3 2022 results will be released on
Monday, November 14th after market close and the shareholder
conference call and webcast will be held on Tuesday, November 15th
at 11:00 AM EST. Dial in and event link details remain the same.
Click here to register.
Luis Marchese, CEO of Sierra Metals, commented, “The tragic
mudslide event that took place at the Yauricocha Mine last month
has been extremely difficult for all of us at Sierra Metals. Safety
for everyone remains our highest priority. As such, mining
operations have re-commenced at a portion of the Yauricocha Mine,
while a very thorough safety assurance process continues before
restarting operations in the remaining areas.”
Additionally, the extended work stoppage at Yauricocha, due to
the road blockade by a local community, concluded after an
agreement was reached. The agreement is currently in the process of
being implemented.”
He continued, “Bolivar's turnaround effort has been delayed due
to unexpected flooding events during most of the quarter at the
Bolivar NorthWest zone in addition to operational delays in
implementing a new raise bore to add ventilation. The flooding is
currently under control.
Further, after an in-depth review, examining the advantages and
disadvantages of Sierra’s listings, management and the Board
determined that it would be in the best interest of the Company and
its shareholders to voluntarily delist from both the NYSE and the
BVL exchanges. The decision is intended to create simplification
and to reduce significant costs associated with the continued
listing on the NYSE and BVL.”
He concluded, “Sierra Metals has endured an unfortunate sequence
of events, that have brought the Company to its current position.
Our goal is to find the best path forward for the Company and its
stakeholders.”
Consolidated Production
Results
Consolidated Production
Three Months Ended September
30,
Nine Months Ended September
30,
Q3 2022
Q2 2022
% Var.
Q3 2021
% Var.
2022
2021
% Var.
Tonnes processed (t)
561,906
640,181
-12%
750,208
-25%
1,792,817
2,312,163
-22%
Daily throughput
6,422
7,316
-12%
8,574
-25%
6,830
8,808
-22%
Silver production (000 oz)
669
608
10%
807
-17%
2,011
2,722
-26%
Copper production (000 lb)
6,299
8,334
-24%
8,256
-24%
20,957
25,686
-18%
Lead production (000 lb)
3,878
3,333
16%
7,841
-51%
11,427
24,805
-54%
Zinc production (000 lb)
10,815
10,426
4%
19,112
-43%
31,733
64,368
-51%
Gold Production (oz)
2,199
2,622
-16%
2,261
-3%
6,744
7,709
-13%
Copper equivalent pounds (000's)(1)
16,637
17,794
-7%
21,870
-24%
50,202
71,966
-30%
(1)
Copper equivalent pounds were calculated
using the following realized prices:
Q3 2022 - $19.26/oz Ag, $3.51/lb Cu,
$1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.
Q2 2022 - $22.65/oz Ag, $4.30/lb Cu,
$1.79/lb Zn, $1.00/lb Pb, $1,872/oz Au
Q3 2021 - $24.20/oz Ag, $4.25/lb Cu,
$1.36/lb Zn, $1.07/lb Pb, $1,790/oz Au.
9M 2022 - $21.95/oz Ag, $4.12/lb Cu,
$1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.
9M 2021 - $25.81/oz Ag, $4.17/lb Cu,
$1.31/lb Zn, $0.99/lb Pb, $1,796/oz Au.
Throughput from the Yauricocha Mine during Q3 2022 was 269,057
tonnes, a 15% decline when compared to the previous quarter. When
compared to Q3 2021, throughput from the Yauricocha Mine was 17%
lower due to the suspension of mining activity and work stoppages
during the third quarter, which resulted in a 31% decrease in
copper equivalent pounds produced.
At the Bolivar Mine, throughput was 227,669 tonnes during Q3
2022 or 11% lower as compared to Q2 2022. Lower throughput,
combined with lower grades in copper and silver resulted in a 10%
decrease in copper equivalent pound production when compared to the
previous quarter. When compared to Q3 2021, throughput at Bolivar
was 38% lower and while grades were higher for silver and gold,
they were not enough to offset the lower throughput, resulting in a
16% decrease in copper equivalent pounds produced.
At Cusi, throughput was 65,180 tonnes during Q3 2022 or 2% lower
as compared to Q2 2022. The slightly lower throughput was offset by
higher grades in all metals, resulting in a 32% increase in silver
equivalent production. When compared to Q3 2021, a 7% increase in
throughput, combined with higher head grades for all metals except
lead, resulted in a 22% increase in silver equivalent
production.
Yauricocha Mine, Peru
The Yauricocha Mine processed 269,057 tonnes during Q3 2022,
which was a 15% decrease when compared to Q2 2022 and an 11%
decrease in copper equivalent pounds produced. While silver, lead
and zinc grades increased by 7%, 24% and 15%, respectively, copper
grades decreased by 17% and gold decreased by 24% when compared to
the previous quarter.
When compared to Q3 2021, there was a 17% decrease from the
324,196 tonnes processed in the same quarter of 2021 and a 31%
decrease in copper equivalent pounds produced. Negative variances
in the grades of all metals were the result of restricted access to
higher grade areas of the mine and contributed to the lower
production of all metals at Yauricocha during Q3 2022.
The significant decrease in tonnage and copper equivalent pounds
produced at Yauricocha is a result of the suspension of mining
activities due to the mudslide that occurred on September 11, 2022
and the subsequent blockade that took place at the mine’s main
entrance.
A summary of production from the Yauricocha Mine for Q3 2022 is
provided below:
Yauricocha Production
Nine Months Ended September
30,
Q3 2022
Q2 2022
% Var.
Q3 2021
% Var.
2022
2021
% Var.
Tonnes processed (t)
269,057
317,087
-15%
324,196
-17%
901,394
979,316
-8%
Daily throughput
3,075
3,624
-15%
3,705
-17%
3,434
3,731
-8%
Silver grade (g/t)
47.61
44.65
7%
56.84
-16%
43.70
56.04
-22%
Copper grade
0.77%
0.93%
-17%
0.87%
-12%
0.83%
0.71%
17%
Lead grade
0.72%
0.58%
24%
1.14%
-37%
0.65%
1.23%
-47%
Zinc grade
2.16%
1.88%
15%
3.06%
-29%
1.95%
3.35%
-42%
Gold Grade (g/t)
0.41
0.54
-24%
0.51
-20%
0.49
0.46
7%
Silver recovery
62.27%
58.64%
6%
76.11%
-18%
61.61%
79.70%
-23%
Copper recovery
77.30%
78.66%
-2%
74.61%
4%
77.55%
69.84%
11%
Lead recovery
83.60%
75.81%
10%
87.33%
-4%
79.73%
90.15%
-12%
Zinc recovery
84.28%
79.21%
6%
87.39%
-4%
81.33%
89.82%
-9%
Gold Recovery
20.79%
21.62%
-4%
21.96%
-5%
20.83%
20.91%
0%
Silver production (000 oz)
256
267
-4%
451
-43%
779
1,385
-44%
Copper production (000 lb)
3,514
5,127
-31%
4,641
-24%
12,920
11,020
17%
Lead production (000 lb)
3,579
3,060
17%
7,146
-50%
10,467
23,683
-56%
Zinc production (000 lb)
10,815
10,426
4%
19,112
-43%
31,733
64,368
-51%
Gold Production (oz)
743
1,179
-37%
1,169
-36%
2,979
3,102
-4%
Copper equivalent pounds (000's)(1)
10,794
12,105
-11%
15,596
-31%
33,702
46,775
-28%
(1)
Copper equivalent pounds were calculated
using the following realized prices:
Q3 2022 - $19.26/oz Ag, $3.51/lb Cu,
$1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.
Q2 2022 - $22.65/oz Ag, $4.30/lb Cu,
$1.79/lb Zn, $1.00/lb Pb, $1,872/oz Au
Q3 2021 - $24.20/oz Ag, $4.25/lb Cu,
$1.36/lb Zn, $1.07/lb Pb, $1,790/oz Au.
9M 2022 - $21.95/oz Ag, $4.12/lb Cu,
$1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.
9M 2021 - $25.81/oz Ag, $4.17/lb Cu,
$1.31/lb Zn, $0.99/lb Pb, $1,796/oz Au.
Bolivar Mine, Mexico
The Bolivar mine processed 227,669 tonnes in Q3 2022, an 11%
decrease from 256,372 tonnes in Q2 2022. Lower production during
Q3, a 5% decrease in copper grades and a 2% decrease in silver
grades resulted in a 10% decrease in copper equivalent pound
production when compared to Q2 2022.
When comparing Q3 2022 to Q3 2021, the Bolivar mine processed
38% fewer tonnes of ore. Copper grades were 2% lower while silver
and gold grades were 9% and 159% higher, respectively which was not
enough to offset the overall decrease in tonnes processed. The
mine’s copper equivalent production for the quarter decreased by
16% when compared to the same quarter last year. Operational ramp
up has been slower than expected due to unforeseen flooding in the
Bolivar NorthWest zone during the quarter.
A summary of production for the Bolivar Mine for Q3 2022 is
provided below:
Bolivar Production Nine Months Ended September 30,
Q3 2022 Q2 2022 % Var. Q3 2021 %
Var.
2022
2021
% Var.
Tonnes processed (t)
227,669
256,372
-11%
364,941
-38%
671,597
1,121,880
-40%
Daily throughput
2,602
2,930
-11%
4,171
-38%
2,558
4,274
-40%
Copper grade
0.60%
0.63%
-5%
0.61%
-2%
0.61%
0.75%
-19%
Silver grade (g/t)
12.14
12.36
-2%
11.18
9%
11.90
16.70
-29%
Gold grade (g/t)
0.27
0.24
13%
0.10
159%
0.23
0.17
35%
Copper recovery
92.05%
90.61%
2%
73.06%
26%
89.60%
79.06%
13%
Silver recovery
79.95%
80.99%
-1%
71.97%
11%
82.72%
81.91%
1%
Gold recovery
64.67%
65.93%
-2%
73.23%
-12%
64.98%
67.62%
-4%
Copper production (000 lb)
2,785
3,207
-13%
3,615
-23%
8,037
14,666
-45%
Silver production (000 oz)
71
83
-14%
95
-25%
212
494
-57%
Gold production (oz)
1,267
1,283
-1%
899
41%
3,142
4,117
-24%
Copper equivalent pounds (000's)(1)
3,799
4,199
-10%
4,531
-16%
10,559
19,495
-46%
(1)
Copper equivalent pounds were calculated
using the following realized prices:
Q3 2022 - $19.26/oz Ag, $3.51/lb Cu,
$1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.
Q2 2022 - $22.65/oz Ag, $4.30/lb Cu,
$1.79/lb Zn, $1.00/lb Pb, $1,872/oz Au
Q3 2021 - $24.20/oz Ag, $4.25/lb Cu,
$1.36/lb Zn, $1.07/lb Pb, $1,790/oz Au.
9M 2022 - $21.95/oz Ag, $4.12/lb Cu,
$1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.
9M 2021 - $25.81/oz Ag, $4.17/lb Cu,
$1.31/lb Zn, $0.99/lb Pb, $1,796/oz Au.
Cusi Mine, Mexico
Operating at an average throughput of 745 tpd, Cusi processed 2%
fewer tonnes of ore in Q3 2022 as compared to Q2 2022. Higher
grades in all metals resulted in a 32% increase in silver
equivalent ounces.
When comparing Q3 2022 to Q3 2021, ore tonnage increased by 7%.
Silver production increased 31%, with gold and lead production
decreasing by 2% and 57%, respectively. Silver equivalent
production of 374,000 ounces for the quarter was 22% higher than in
Q3 2021.
A summary of production for the Cusi Mine for Q3 2022 is
provided below:
Cusi Production
Nine Months Ended September
30,
Q3 2022
Q2 2022
% Var.
Q3 2021
% Var.
2022
2021
% Var.
Tonnes processed (t)
65,180
66,722
-2%
61,071
7%
219,826
210,967
4%
Daily throughput
745
763
-2%
698
7%
837
804
4%
Silver grade (g/t)
187.44
146.34
28%
161.03
16%
169.57
151.98
12%
Gold grade (g/t)
0.19
0.17
12%
0.18
6%
0.18
0.16
13%
Lead grade
0.26%
0.23%
13%
0.62%
-58%
0.25%
0.29%
-14%
Silver recovery (flotation)
87.24%
82.07%
6%
82.63%
6%
84.86%
81.77%
4%
Gold recovery (lixiviation)
48.28%
43.64%
11%
55.89%
-14%
47.46%
43.90%
8%
Lead recovery
80.70%
80.78%
0%
82.64%
-2%
78.59%
82.36%
-5%
Silver production (000 oz)
342
258
33%
261
31%
1,020
843
21%
Gold production (oz)
189
160
18%
193
-2%
623
490
27%
Lead production (000 lb)
299
273
10%
695
-57%
960
1,122
-14%
Silver equivalent ounces (000's)(1)
374
283
32%
306
22%
1,115
920
21%
(1)
Silver equivalent ounces were calculated
using the following realized prices:
Q3 2022 - $19.26/oz Ag, $3.51/lb Cu,
$1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.
Q2 2022 - $22.65/oz Ag, $4.30/lb Cu,
$1.79/lb Zn, $1.00/lb Pb, $1,872/oz Au
Q3 2021 - $24.20/oz Ag, $4.25/lb Cu,
$1.36/lb Zn, $1.07/lb Pb, $1,790/oz Au.
9M 2022 - $21.95/oz Ag, $4.12/lb Cu,
$1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.
9M 2021 - $25.81/oz Ag, $4.17/lb Cu,
$1.31/lb Zn, $0.99/lb Pb, $1,796/oz Au.
Delisting From The NYSE American and
BVL Stock Exchanges
Sierra Metals will notify the U.S. Securities and Exchange
Commission (the “SEC”) and the National Commission on the
Supervision of Companies and Securities of its withdrawal of the
common shares from listing on the NYSE and BVL, respectively.
The Company decided to pursue the voluntary de-listings after
concluding that the disadvantages of maintaining its listing on the
NYSE and the BVL outweighed the benefits to the Company and its
shareholders. It was determined that a delisting will simplify
Sierra’s administrative and compliance structure and reduce costs
associated with the listing fees.
The decision to voluntarily delist the common shares from the
NYSE and BVL will not impact the Company’s listing on the Toronto
Stock Exchange (“TSX”). The common shares will continue to be
listed and traded on the TSX, subject to compliance with TSX
continued listing standards.
The Company expects that the last day of trading of the common
shares on the NYSE will be on or about November 14, 2022 and on the
BVL on or about December 15, 2022, subject to the satisfaction of
the requirements and completion of the internal processes of the
latter exchange.
Shareholders holding shares in U.S. brokerage accounts should
contact their brokers to confirm how to trade Sierra Metals’ shares
in the future on the TSX. Likewise, shareholders holding shares
acquired through Peruvian stockbroker agents should contact their
brokers to confirm how to trade Sierra Metals’ shares in the future
on the TSX.
Quality Control
Américo Zuzunaga, FAusIMM (Mining Engineer) and Vice President,
Technical, is a Qualified Person under National Instrument 43-101 –
Standards of Disclosure for Mineral Projects.
About Sierra Metals
Sierra Metals Inc. is a diversified Canadian mining company with
Green Metal exposure including copper production and base metal
production with precious metals byproduct credits, focused on the
production and development of its Yauricocha Mine in Peru, and
Bolivar and Cusi Mines in Mexico. The Company is focused on
increasing production volume and growing mineral resources. The
Company also has large land packages at all three mines with
several prospective regional targets providing longer-term
exploration upside and mineral resource growth potential.
For further information regarding Sierra Metals, please visit
www.sierrametals.com.
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Forward-Looking Statements
This press release contains forward-looking information within
the meaning of Canadian and United States securities legislation,
including with respect to the delisting of the Common Shares on the
NYSE and BVL (and the timing thereof), results of the delisting and
the timing of the release of the Company’s Q3 2022 results and
shareholders’ call and webcast. 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 16,
2022 for its fiscal year ended December 31, 2021 and other risks
identified in the Company's filings with Canadian securities
regulators and the United States Securities and Exchange
Commission, which filings are available at www.sedar.com and
www.sec.gov, respectively.
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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version on businesswire.com: https://www.businesswire.com/news/home/20221025006064/en/
Investor Relations Sierra Metals Inc. Tel: +1 (416)
366-7777 Email: info@sierrametals.com
Luis Marchese CEO Sierra Metals Inc. Tel: +1 (416)
366-7777
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