(All $ figures reported in USD)
Current and historical production and financial results for Cusi
are not included in the Company’s consolidated results, 2023
Guidance as Cusi has been classified as a Discontinued
Operation.
- Revenue of $57.0 million in Q3 2023, a 62% increase from Q3
2022.
- Adjusted EBITDA(1) of $8.1 million in Q3 2023, significantly
higher than the Adjusted EBITDA(1) of $(6.2) million in Q3
2022.
- Operating cash flows before movements in working capital(1) of
$6.0 million in Q3 2023, compared to $(6.8) million Q3 2022.
- Net loss, excluding discontinued operations, in Q3 2023 was
$2.8 million versus a loss of $38.1 million in Q3 2022.
- Copper equivalent production of 18.5 million pounds in Q3 2023;
a 27% increase from Q3 2022.
- Consolidated cash costs per copper equivalent payable pound(1)
in Q3 2023 of $2.11 and consolidated All-In Sustaining Costs per
equivalent payable pound (“AISC”)(1) of $3.66 were 12% and 5%
lower, respectively, than the same quarter of 2022.
- On-track to meet 2023 production and cost guidance.
- Second tranche of the private placement in the amount of
C$3,543,663.40 is now available to the Company, in addition to the
amount of C$12,837,133.40 previously made available in the first
tranche of the private placement.
Management will host a conference call and webcast to discuss
Q3 2023 Results today, November 13, 2023, at 11:00 AM (EST).
Click HERE to register.
Sierra Metals Inc. (TSX: SMT | OTC: SMTSF) ("Sierra
Metals" or "the Company") reports financial results for
the three-month (“Q3”) and nine-month (“9M”) period ended September
30, 2023 with total revenues of $57.0 million and Adjusted
EBITDA(1) of $8.1 million on throughput of 622,622 tonnes and metal
production of 18.5 million copper equivalent pounds in Q3 2023.
Ernesto Balarezo, CEO of Sierra Metals, commented, “We continued
to make incremental improvements across our operations during the
quarter, and are very pleased the hard work by our team is paying
off as we are on track to meet 2023 guidance. During the quarter we
placed the non-core Cusi silver mine on care and maintenance and
initiated a sale process for this asset with the belief that these
steps will improve our portfolio and support our future growth. And
lastly, we are pleased with the support shown by shareholders who
participated in our recent financing, which validated our strategy
and helped to strengthen our balance sheet.”
(1) This is a non-IFRS performance measure. See the Non-IFRS
Performance Measures section of the press release.
Mr. Balarezo continues, “In the first three quarters of 2023, we
have almost equaled the entire production of 2022 so our
operational improvements are working. The momentum across our
business has continued into the fourth quarter as we look forward
to a strong finish for 2023.”
Q3 2023 Consolidated Financial
Summary
The information provided below are excerpts from the Company’s
Q3 2023 financial statements and Management’s Discussion and
Analysis (“MD&A”), which are available on the Company's website
(www.SierraMetals.com) and on SEDAR+ (www.sedarplus.ca) under the
Company’s profile.
Consolidated results include results from the Company’s
Yauricocha Mine (“Yauricocha”) in Peru and the Bolivar Mine
(“Bolivar”) in Mexico. The Cusi Mine (“Cusi”) in Mexico was
classified as a non-core asset in Q1 2023 and, on September 20,
2023, was put on care and maintenance, with a sale process now
underway. Current and historical production and financial results
for Cusi are not included in the Company’s consolidated results,
2023 Guidance and has been classified as a Discontinued
Operation.
(In thousands of dollars, except per share and cash cost amounts,
consolidated figures unless noted otherwise)
Nine months ended September
30,
Q3 2023
Q2 2023
Q3 2022
2023
2022
Operating Ore Processed / Tonnes Milled
622,622
650,302
496,726
1,791,086
1,572,991
Silver Ounces Produced (000's)
458
523
327
1,370
991
Copper Pounds Produced (000's)
9,477
10,459
6,299
28,221
20,957
Lead Pounds Produced (000's)
4,084
3,930
3,579
10,792
10,467
Zinc Pounds Produced (000's)
11,176
12,228
10,815
33,983
31,733
Gold Ounces Produced
3,651
4,311
2,010
11,753
6,121
Copper Equivalent Pounds Produced (000's)1
18,496
20,246
14,593
55,342
44,261
Cash Cost per Tonne Processed
$
59.36
$
56.24
$
65.41
$
58.00
$
62.77
Cash Cost per CuEqLb2
$
2.11
$
1.80
$
2.39
$
2.00
$
2.51
AISC per CuEqLb2
$
3.66
$
3.24
$
3.85
$
3.43
$
4.11
Cash Cost per CuEqLb (Yauricocha)2
$
2.08
$
2.29
$
2.01
$
2.14
$
2.09
AISC per CuEqLb (Yauricocha)2
$
3.75
$
3.97
$
3.36
$
3.62
$
3.49
Cash Cost per CuEqLb (Bolivar)2
$
2.15
$
1.62
$
3.38
$
1.86
$
3.71
AISC per CuEqLb (Bolivar)2
$
3.57
$
3.02
$
5.12
$
3.24
$
5.88
Financial Revenues
$
56,963
$
58,411
$
35,198
$
168,911
$
126,959
Adjusted EBITDA2
$
8,080
$
14,494
$
(6,218
)
$
38,056
$
10,296
Operating cash flows before movements in working capital
$
6,013
$
11,588
$
(6,768
)
$
30,452
$
2,303
Adjusted net income (loss) attributable to shareholders2
$
(2,137
)
$
5,985
$
(12,125
)
$
9,388
$
(16,442
)
Net income (loss) attributable to shareholders
$
(9,301
)
$
1,638
$
(46,150
)
$
(5,610
)
$
(61,047
)
Net income (loss) (excluding discontinued operations)
$
(2,758
)
$
3,896
$
(38,102
)
$
4,699
$
(52,144
)
Cash and cash equivalents
$
6,052
$
4,393
$
13,690
$
6,052
$
13,690
Working capital 3
$
(81,375
)
$
(88,431
)
$
(52,345
)
$
(81,375
)
$
(52,345
)
(1) Copper equivalent pounds were
calculated using the following realized prices:
Q3 2023 - $23.56/oz Ag, $3.78/lb Cu,
$1.10/lb Zn, $0.98/lb Pb, $1,927/oz Au.
Q2 2023 - $24.17/oz Ag, $3.99/lb Cu,
$1.16/lb Zn, $0.96/lb Pb, $1,977/oz Au.
Q3 2022 - $19.26/oz Ag, $3.51/lb Cu,
$1.49/lb Zn, $0.90/lb Pb, $1,730/oz Au.
9M 2023 - $23.44/oz Ag, $3.94/lb Cu,
$1.23/lb Zn, $0.97/lb Pb, $1,932/oz Au.
9M 2022 - $21.95/oz Ag, $4.12/lb Cu,
$1.66/lb Zn, $0.99/lb Pb, $1,826/oz Au.
(2) This is a non-IFRS performance
measure, see Non-IFRS Performance Measures section of the
MD&A.
(3) Despite the successful refinancing of
part of the corporate credit facility and improved operational
performance, the Company continues to be in breach of some of its
debt covenants, since these are calculated on a rolling
four-quarter basis. Hence the working capital continues to be
negative due to the result of the reclassification of the long-term
portion of the corporate facility and term loan to current.
Revenue from metals payable was $57.0 million in Q3 2023,
representing an increase of 62% over the same period in 2022 of
$35.2 million and a 2% decline compared to Q2 2023 of $58.4
million. The increase in revenue from Q3 2022 to Q3 2023 was
largely driven by higher metal sales at Bolivar and higher copper,
silver, lead and gold prices.
Realized Metal Prices
Nine months ended September
30,
(In US dollars)
Q3 2023
Q2 2023
Q3 2022
2023
2022
Silver (oz)
$
23.56
$
24.17
$
19.26
$
23.44
$
21.95
Copper (lb)
$
3.78
$
3.99
$
3.51
$
3.94
$
4.12
Zinc (lb)
$
1.10
$
1.16
$
1.49
$
1.23
$
1.66
Lead (lb)
$
0.98
$
0.96
$
0.90
$
0.97
$
0.99
Gold (oz)
$
1,927
$
1,977
$
1,730
$
1,932
$
1,826
Consolidated cash costs per copper equivalent payable pound(1)
in Q3 2023 of $2.11 and consolidated AISC(1) per equivalent payable
pound copper of $3.66 were 12% and 5%, respectively, lower than the
same quarter of 2022. The improvements in consolidated cash costs
and AISC per copper equivalent pound were primarily due to higher
production levels at Bolivar despite lower production at
Yauricocha.
Adjusted EBITDA(1) in Q3 2023 was $8.1 million, compared to
negative Adjusted EBITDA of $6.2 million in the same quarter of
2022. The improved Adjusted EBITDA is primarily driven by higher
revenues, attributable to higher production and improved operating
costs compared to Q3 2022.
Net loss attributable to shareholders for Q3 2023 was $9.3
million (Q3 2022: a net loss of $46.2 million) or $(0.06) per share
(basic and diluted) (Q3 2022: $(0.28)).
Excluding discontinued operations, net loss was $2.8 million in
Q3 2023 versus a loss of $38.1 million in Q3 2022.
Adjusted net loss attributable to shareholders(1) of $2.1
million, or $(0.01) per share, for Q3 2023 compared to the adjusted
net loss of $12.1 million, or $(0.07) per share for Q3 2022.
(1) This is a non-IFRS performance
measure. See the Non-IFRS Performance Measures section of the press
release.
Cash flow generated from operating activities before movements
in working capital was $6.0 million for Q3 2023 as compared to $6.8
million of cash used in operating activities in Q3 2022. The
increase resulted from higher revenues and lower costs during Q3
2023 versus Q3 2022.
Cash and cash equivalents as at September 30, 2023 were $18.2
million (including restricted cash of $12.1 million), and working
capital of $(81.4) million, compared to $5.1 million and $(78.1)
million, respectively, at the end of 2022. Cash and cash
equivalents increased during the nine-month period as a result of
cash generated from operating activities of $35.3 million, cash
generated from financing activities of $10.3 million and cash used
in investing activities of $32.5 million.
The Company has raised approximately C$16.4 million from various
investors, including existing shareholders, directors and employees
in a private placement of 43,107,360 common shares. The private
placement closed after the end of the third quarter and funds
became available in two tranches, the first being approximately
C$12.8 million and the second being approximately C$3.5 million,
each at a subscription price of C$0.38 per common share. Common
shares issued pursuant to the private placement are subject to
statutory hold requirements, as applicable.
Outlook 2023
The Company is on-track to meet its 2023 production guidance as
previously announced on August 14, 2023. Production for all metals
has been in-line with the guidance range as can be seen from the
table below. Copper equivalent production calculations have been
negatively impacted by the drop in zinc prices during the
nine-month period ended September 30, 2023. For comparison
purposes, the copper equivalent production has been recalculated at
the same metal prices that were used for the original guidance.
Cash costs and AISC per copper equivalent payable pound for
Yauricocha and Bolivar have also been adjusted in the ‘Cash costs
and AISC’ table below by using copper equivalent payable pounds at
2023 guidance metal prices.
Production Guidance
2023 Guidance (1)
2023 9M (1)
Low
High
Actual
Silver (000 oz)
1,500
1,700
1,370
Copper (000 lbs)
37,300
42,400
28,221
Lead (000 lbs)
14,000
15,400
10,792
Zinc (000 lbs)
46,000
50,500
33,983
Gold (oz)
13,500
15,400
11,753
Copper equivalent pounds (000's) (2)
74,300
83,300
57,851
(1) 2023 Production guidance and actual production for 9M
2023 exclude production from the Cusi mine, which the Company
considers as a non-core asset. (2) 2023 metal equivalent guidance
was calculated using the following prices: $21.03/oz Ag, $3.55/lb
Cu, $1.35/lb Zn, $0.93/lb Pb and $1,741/oz Au. Actual copper
equivalent pounds produced have been recalculated using the same
price for comparison purposes
Cash Costs and AISC Guidance
Actual for 9M 2023(3) Equivalent Production Cash
costs range AISC(2) range Copper Eq Lbs ('000)
Cash costs AISC(2) Mine Range (1)
per CuEqLb per CuEqLb per CuEqLb per
CuEqLb Yauricocha Copper Eq Lbs ('000) 40,000 - 44,000
$1.81 - $1.88 $3.50 - $3.60
31,460
$1.97
$3.34
Bolivar Copper Eq Lbs ('000) 34,500 - 39,500 $1.92 - $2.05 $3.02 -
$3.25
26,391
$1.86
$3.24
(1) 2023 metal equivalent guidance was calculated using the
following prices: $21.03/oz Ag, $3.55/lb Cu, $1.35/lb Zn, $0.93/lb
Pb and $1,741/oz Au. Actual copper equivalent pounds produced have
been recalculated using the same price for comparison purposes. (2)
AISC includes treatment and refining charges, selling costs,
G&A costs and sustaining capital expenditure. These costs have
been adjusted using copper equivalent payable pounds calculated at
metal prices used for 2023 guidance as per note 1 above. (3) These
costs have been adjusted using copper equivalent payable pounds
calculated at metal prices used for 2023 guidance as per note 1
above.
Q3 2023 Operating
Highlights
The Company reported Q3 2023 production results on October 19,
2023. Highlights of each mine’s activities in the quarter is as
follows:
Yauricocha Mine, Peru
Yauricocha processed 259,732 tonnes during Q3 2023, an increase
of 6% over Q2 2023 and a decrease of 3% from Q3 2022. Copper,
silver and gold grades increased by 23%, 7% and 3%, respectively
over Q2 2023 and increased by 16%, 23% and 0%, respectively over Q3
2022. Copper equivalent production for Q3 2023 of 10.4 million
pounds represented a 9% increase over the previous quarter and a
decline of 4% when compared to Q3 2022.
When compared to Q3 2022, the 4% decrease in the copper
equivalent pounds produced in Q3 2023 resulted from the change in
metal prices, particularly zinc prices which declined by more than
26% as compared to Q3 2022. The increase in metal production,
except for gold, did not offset the impact of the change in metal
prices as compared to Q3 2022.
Yauricocha had a cash cost per copper equivalent payable pound1
of $2.08 (Q3 2022 - $2.01), and an AISC per copper equivalent
payable pound1 of $3.75 (Q3 2022 - $3.36) for Q3 2023. Cash costs
increased for Q3 2023 due to a 26% decline in average realized
prices for zinc which resulted in a 3% decrease in the copper
equivalent payable pounds as compared to Q3 2022. The increase in
the AISC for Q3 2023 was mainly a result of the 37% and 44%
increase in the general and administration (“G&A”) costs and
sustaining capital expenditure respectively, as compared to Q3
2022.
Bolivar Mine, Mexico
Bolivar achieved a throughput of 362,890 tonnes in Q3 2023, a
59% increase from Q3 2022, but a decline of 11% compared to Q2
2023, as anticipated. Bolivar recorded higher grades for all metals
in Q3 2023, namely 28%, 27% and 37% for copper, silver, and gold,
respectively, as compared to Q3 2022, and 16%, 21% and 12% lower
for copper, silver, and gold, respectively, when compared to Q2
2023. As a result, copper equivalent production of 8.1 million
pounds in Q3 2023 was 113% higher than in Q3 2022 and 24% lower
than in Q2 2023.
Bolivar’s cash cost per copper equivalent payable pound
decreased 37% to $2.15 (Q3 2022 - $3.38), and AISC per copper
equivalent payable pound decreased 30% to $3.57 (Q3 2022 - $5.12)
as a result of the 131% higher copper equivalent payable pounds as
compared to Q3 2022.
(1) This is a non-IFRS performance
measure. See the Non-IFRS Performance Measures section of the press
release.
Conference Call and
Webcast
Sierra Metals' senior management will host a conference call and
webcast to discuss the Company's financial and operating results
for the three months ended September 30, 2023. Details are as
follows:
Date:
November 13, 2023
Time:
11:00 am (Eastern)
Webcast:
https://services.choruscall.ca/links/sierrametalsq32023.html
Telephone:
Canada/USA (toll free):
1-800-319-4610
Other: 1-416-915-3239
The webcast, along with presentation slides, will be archived
for 180 days on www.sierrametals.com.
Non-IFRS Performance
Measures
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. The Company believes these measures may allow certain
investors to use this information to evaluate the Company’s
performance.
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.
The following table provides a reconciliation of adjusted EBITDA
to the condensed interim consolidated financial statements for the
three and nine months ended September 30, 2023 and 2022:
Three months ended September
30,
Nine months ended September
30,
2023
2022
2023
2022
Net income
$
(9,366
)
$
(47,114
)
$
(6,154
)
$
(60,724
)
Adjusted for: Depletion and depreciation
9,580
9,765
26,390
28,381
Interest expense and other finance costs
2,641
1,381
7,628
3,098
NRV adjustments on inventory
2,647
2,295
4,202
7,513
Share-based payments
460
253
648
579
Costs related to COVID
-
109
-
1,693
Foreign currency exchange and other provisions
(1,164
)
(147
)
897
1,415
Impairment charges
2,500
32,000
2,500
32,000
Income taxes
(484
)
(2,409
)
(566
)
(421
)
Adjusted EBITDA
$
6,814
$
(3,867
)
$
35,545
$
13,534
Less: Adjusted EBITDA from discontinued operations
(1,266
)
2,351
(2,511
)
3,238
Adjusted EBITDA from continuing operations
8,080
(6,218
)
38,056
10,296
Non-IFRS reconciliation of adjusted net income (loss)
The Company has included the non-IFRS financial performance
measure of adjusted net income (loss), 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.
The following table provides a reconciliation of adjusted net
income (loss) to the condensed interim consolidated financial
statements for the three and nine months ended September 30, 2023
and 2022:
Three months ended September
30,
Nine months ended September
30,
(In thousands of United States dollars)
2023
2022
2023
2022
Net loss attributable to shareholders
$
(9,301
)
$
(46,150
)
$
(5,610
)
$
(61,047
)
Non-cash depletion charge on Corona's acquisition
1,362
1,428
3,607
4,528
Deferred tax recovery on Corona's acquisition depletion charge
(415
)
(384
)
(1,101
)
(1,379
)
NRV adjustments on inventory
2,647
2,295
4,202
7,513
Share-based compensation
460
253
648
579
Foreign currency exchange loss (gain)
(1,164
)
(147
)
897
1,415
Impairment charges
2,500
32,000
2,500
32,000
Adjusted net income (loss) attributable to shareholders
$
(3,911
)
$
(10,705
)
$
5,143
$
(16,391
)
Less: Adjusted net income (loss) from discontinued
operations
(1,774
)
1,420
(4,245
)
51
Adjusted net income (loss) from continuing operations
(2,137
)
(12,125
)
9,388
(16,442
)
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.
All-in sustaining cost per copper equivalent payable
pound
All-In Sustaining Cost (“AISC”) is a non-IFRS measure and was
calculated based on guidance provided by the World Gold Council
(“WGC”) in June 2013. 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 silver and 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 silver
and 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 silver and
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.
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 and nine months
ended September 30, 2023 and 2022:
Three months ended
Three months ended
(In thousand of US dollars, unless stated)
September 30, 2023
September 30, 2022
Yauricocha
Bolivar
Consolidated
Yauricocha
Bolivar
Consolidated
Cash Cost per Tonne of Processed
Ore Cost of Sales
25,754
22,860
48,614
25,084
16,633
41,717
Reverse: Workers Profit Sharing
-
(906
)
(906
)
103
-
103
Reverse: D&A/Other adjustments
(5,958
)
(3,414
)
(9,372
)
(5,348
)
(3,958
)
(9,306
)
Reverse: Variation in Inventory
(84
)
(1,295
)
(1,379
)
271
(296
)
(25
)
Total Cash Cost
19,712
17,245
36,957
20,110
12,379
32,489
Tonnes Processed
259,732
362,890
622,622
269,057
227,669
496,726
Cash Cost per Tonne Processed US$
75.89
47.52
59.36
74.75
54.37
65.41
Nine months ended
Nine months ended
(In thousand of US dollars, unless stated)
September 30, 2023
September 30, 2022
Yauricocha
Bolivar
Consolidated
Yauricocha
Bolivar
Consolidated
Cash Cost per Tonne of Processed
Ore Cost of Sales
72,276
57,232
129,508
78,793
49,350
128,143
Reverse: Workers Profit Sharing
-
(906
)
(906
)
(514
)
-
(514
)
Reverse: D&A/Other adjustments
(16,729
)
(9,109
)
(25,838
)
(15,792
)
(10,485
)
(26,277
)
Reverse: Variation in Inventory
1,042
79
1,121
(1,742
)
(879
)
(2,621
)
Total Cash Cost
56,589
47,296
103,885
60,745
37,986
98,731
Tonnes Processed
723,192
1,067,894
1,791,086
901,394
671,597
1,572,991
Cash Cost per Tonne Processed US$
78.25
44.29
58.00
67.39
56.56
62.77
The following table provides detailed information on
Yauricocha’s cash cost, and all-in sustaining cost per copper
equivalent payable pound for the three and nine months ended
September 30, 2023 and 2022:
YAURICOCHA Three months ended Nine months
ended (In thousand of US dollars, unless stated)
September
30, 2023 September 30, 2022 September 30, 2023
September 30, 2022 Cash Cost
per copper equivalent payable pound Total Cash Cost
19,712
20,110
56,589
60,745
Variation in Finished inventory
84
(271
)
(1,042
)
1,742
Total Cash Cost of Sales
19,796
19,839
55,547
62,487
Treatment and Refining Charges
6,661
6,495
18,099
21,024
Selling Costs
817
841
2,235
2,471
G&A Costs
3,413
2,495
8,323
7,018
Sustaining Capital Expenditures
5,005
3,476
9,946
11,194
All-In Sustaining Cash Costs
35,692
33,146
94,150
104,194
Copper Equivalent Payable Pounds (000's)
9,520
9,856
25,994
29,887
Cash Cost per Copper Equivalent Payable Pound (US$)
2.08
2.01
2.14
2.09
All-In Sustaining Cash Cost per Copper Equivalent Payable
Pound (US$)
3.75
3.36
3.62
3.49
The following table provides detailed information on Bolivar’s
cash cost, and all-in sustaining cost per copper equivalent payable
pound for the three and nine months ended September 30, 2023 and
2022:
BOLIVAR Three months ended Nine months ended
(In thousand of US dollars, unless stated)
September 30,
2023 September 30, 2022 September 30, 2023
September 30, 2022 Cash Cost
per copper equivalent payable pound Total Cash Cost
17,266
12,379
47,296
37,986
Variation in Finished inventory
1,295
296
(79
)
879
Total Cash Cost of Sales
18,561
12,675
47,217
38,865
Treatment and Refining Charges
3,064
1,303
8,048
5,888
Selling Costs
2,067
757
5,938
2,846
G&A Costs
2,157
856
4,911
2,786
Sustaining Capital Expenditures
5,025
3,626
15,923
11,183
All-In Sustaining Cash Costs
30,874
19,217
82,037
61,568
Copper Equivalent Payable Pounds (000's)
8,650
3,752
25,350
10,476
Cash Cost per Copper Equivalent Payable Pound (US$)
2.15
3.38
1.86
3.71
All-In Sustaining Cash Cost per Copper Equivalent Payable
Pound (US$)
3.57
5.12
3.24
5.88
The following table provides detailed information on Company’s
consolidated cash cost, and all-in sustaining cost per copper
equivalent payable pounds for the three and nine months ended
September 30, 2023 and 2022:
CONSOLIDATED Three months ended Nine months
ended (In thousand of US dollars, unless stated)
September
30, 2023 September 30, 2022 September 30, 2023
September 30, 2022 Total Cash Cost of Sales
38,357
32,514
102,764
101,352
All-In Sustaining Cash Costs
66,566
52,363
176,187
165,762
Copper Equivalent Payable Pounds (000's)
18,170
13,608
51,344
40,363
Cash Cost per Copper Equivalent Payable Pound (US$)
2.11
2.39
2.00
2.51
All-In Sustaining Cash Cost per Copper Equivalent Payable
Pound (US$)
3.66
3.85
3.43
4.11
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 Peru and Bolivar Mine in Mexico.
The Company is intent on safely increasing production volume and
growing mineral resources. Sierra Metals has recently had several
new key discoveries and still has many more exciting brownfield
exploration opportunities in Peru and Mexico that are within close
proximity to the existing mines. Additionally, the Company has
large land packages at each of its mines with several prospective
regional targets providing longer-term exploration upside and
mineral resource growth potential.
Forward-Looking
Statements
This news 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 Metals and reflects management's expectations or beliefs
regarding such future events and anticipated performance based on
an assumed set of economic conditions and courses of action
including the accuracy of the Company's current mineral resource
estimates, that the Company's activities will be conducted in
accordance with the Company's public statements and stated goals,
and that there will be no material adverse change affecting the
Company, its properties or its production estimates, the expected
trends in mineral prices, inflation and currency exchange rates,
that all required approvals will be obtained for the Company's
business operations on acceptable terms, and that there will be no
significant disruptions affecting the Company's operations. 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. Forward-looking statements include statements with
respect to the sale of Cusi. By its very nature forward-looking
information involves known and unknown risks, uncertainties and
other factors that may cause actual performance of Sierra Metals 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 28,
2023 for its fiscal year ended December 31, 2022 and other risks
identified in the Company's filings with Canadian securities
regulators, which filings 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/20231113049900/en/
For further information regarding Sierra Metals, please visit
www.sierrametals.com or contact:
Investor Relations Sierra Metals Inc. +1 (416) 366-7777
info@sierrametals.com
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