Trading Symbol: "IPT: TSX.V"
VANCOUVER, May 27, 2019 /CNW/ - IMPACT Silver Corp.
("IMPACT" or the "Company") announces its financial and operating
results for the quarter ending March 31,
2019.
The Company reported $3.0 million
in revenue for the first quarter of 2019 compared to Q1 2018 at
$3.9 million with improved grades
helping to offset lower tonnage and silver prices. Mine operating
earnings before amortization and depletion were breakeven for the
first time since Q1 2018 as cost reductions and grade improvements
are having a positive impact.
Fred Davidson, President &
CEO of IMPACT, stated, "In Q1 2019, silver prices continued to be
challenging with prices below $16
USD/ounce. In reaction to these persistent low metal prices,
IMPACT has reduced tonnage and focused on higher grades which
resulted in a 16% reduction in cost and a 23% decline in revenue
during the quarter. Going forward given the current silver price
environment, we aim to break even on existing production levels
while metal prices remain depressed and explore selective
high-grade targets which IMPACT may fast track to higher grade
production."
IMPACT is increasingly shifting production to the Guadalupe
Silver Mine located adjacent to the Guadalupe mill which saves
significant hauling costs. Historic production from the Guadalupe
Mine was first recorded in 1529 and more recently between 1967-1982
produced an estimated 9,000,000 ounces of silver. Benefiting from
better silver grades, proximity to the mill, and existing low-cost
shaft infrastructure (which was updated in 2019), in Q1 2019 the
Guadalupe mine accounted for 27% of the total production feed and
management expects this to continue to increase.
Production Overview
- Silver production decreased to 163,575 ounces in Q1 2019
from 203,199 ounces in Q1 2018 due to planned lower
tonnages produced.
- Average mill feed grade for silver in the quarter increased to
167 g/t silver in Q1 2019, a 4% increase from Q1 2018 at 160 g/t
silver.
- Throughput at the mill decreased 23% to 35,788 tonnes milled in
Q1 2019 from 46,602 in Q1 2018.
Financial Overview
- Revenue for Q1 2019 was comparable to Q4 2018 at $3.0 million. However, revenue per tonne
increased to $84.98 from Q4 2018
($79.55) as the Company focused
on improving head grade at the mill to combat lower silver
prices.
- Mine operating earnings before amortization and depletion were
breakeven ($0.0) compared to
$0.3 million in Q1 2018 as cost
reductions and grade improvements started materializing.
- Mine operating loss was $0.4
million for Q1 2019 compared to $0.1
million in Q1 2018.
- Net loss for quarter was $0.9
million which includes $0.1
million of foreign exchange loss and non-cash expenses of
$0.4 million for amortization,
depletion, and deferred income taxes.
- The Company had cash of $0.4
million and trade and other receivables of $1.6 million at March 31,
2019.
- The Company has no long-term debt.
Silver prices for the first quarter of 2019 were range bound to
$15 to $16
USD per ounce though some experts have forecasted higher
prices on upcoming geopolitical uncertainties in the world, the
historic high gold to silver ratio, and 2% decrease in worldwide
silver production while investment demand has surged 20% year over
year.
Cost control remains a high priority for IMPACT. In addition to
increasing efficiency and grade at operations, cost reduction
initiatives are well under way to ensure IMPACT can weather the
markets. Direct cost per tonne at the mill was $82.47 in Q1 2019 compared to Q4 2018 of
$91.50, a 10% reduction and showing
progress on the Company's continued push on cost
reductions. On the positive side, revenue per tonne sold for
Q4 increased to $84.98 versus
$79.55 in Q4 2018, a 7% increase from
the previous quarter. IMPACT continues to focus on cost reductions
and maximizing revenue per ounce sold.
Dense Media Separation Study at Capire
Subsequent to quarter end, IMPACT announced commissioning of an
engineering study to test the viability of Dense Media Separation
(DMS) processing at its Capire Production Centre. DMS is a low-cost
method of pre-concentrating minerals to increase the grade of
mineral feed into the processing plant and improve processing
economics. Results of the DMS test are pending.
New Concentrate Sales Partnership
In late Q1 2019, IMPACT Silver entered into a new concentrate
sales and refining partnership with Samsung C&T Corp. The
Company believes the pricing is competitive with this new contract
albeit with longer payment terms.
George Gorzynski, P.Eng., a
Qualified Person under the meaning of Canadian National Instrument
43-101, approved the technical content regarding exploration work
in this news release.
A recorded conference call reviewing the financial and
production results for the first three months ending March 31, 2019 will be available on the Company
website on May 27, 2019
at www.impactsilver.com/s/ConferenceCalls.asp.
The information in this news release should be read in
conjunction with the Company's unaudited condensed consolidated
interim financial statements and Management's Discussion and
Analysis, available on the Company website
at www.impactsilver.com and on SEDAR
at www.sedar.com. All amounts are stated in Canadian dollars
unless otherwise specified.
About IMPACT Silver:
IMPACT Silver Corp. is a successful silver-gold
explorer-producer with two processing plants on adjacent districts
within its 100% owned mineral concessions covering 357
km2 in central Mexico
with excellent infrastructure and labor force. Over the past
twelve years IMPACT has produced over 9.4 million ounces of silver,
generating revenues over $175
million, with no long-term debt. At the Royal Mines of
Zacualpan Silver District several underground silver mines feed the
central Guadalupe processing plant. To the south, in the
Mamatla District the Capire
processing pilot plant is an expandable 200 tpd with a NI-43-101
compliant resource of silver-lead-zinc (see IMPACT news release
dated January 18, 2016 for details)
awaiting higher metal prices to be restarted. Given the challenging
markets the last few years, IMPACT has focused its exploration
efforts on gold and silver targets with quick to production
profiles and proximity to the Guadalupe processing plant. Following
a successful decade of exploration success to production cash
flows, IMPACT has shown the Zacualpan District to be prolific in
generating high grade epithermal silver-gold production feeds. With
markets more perceptive to exploration results and the requirement
for additional production feed, IMPACT continues to add emphasis to
exploration work.
Additional information about IMPACT and its operations can be
found on the Company website at www.IMPACTSilver.com.
On behalf of IMPACT Silver Corp.
"Frederick W. Davidson"
President & CEO
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Forward-Looking and Cautionary Statements
This IMPACT News Release may contain certain "forward-looking"
statements and information relating to IMPACT that is based on the
beliefs of IMPACT management, as well as assumptions made by and
information currently available to IMPACT management. Such
statements reflect the current risks, uncertainties and assumptions
related to certain factors including but not limited to, without
limitations, exploration and development risks, expenditure and
financing requirements, title matters, operating hazards, metal
prices, political and economic factors, competitive factors,
general economic conditions, relationships with vendors and
strategic partners, governmental regulation and supervision,
seasonality, technological change, industry practices, and one-time
events. Should any one or more risks or uncertainties materialize
or change, or should any underlying assumptions prove incorrect,
actual results and forward-looking statements may vary materially
from those described herein. IMPACT does not assume the obligation
to update any forward-looking statement.
The Company's decision to place a mine into production, expand a
mine, make other production related decisions or otherwise carry
out mining and processing operations, is largely based on internal
non-public Company data and reports based on exploration,
development and mining work by the Company's geologists and
engineers. The results of this work are evident in the discovery
and building of multiple mines for the Company and in the track
record of mineral production and financial returns of the Company
since 2006. Under NI43‑101 the Company is required to disclose that
it has not based its production decisions on NI43‑101‑compliant
mineral resource or reserve estimates, preliminary economic
assessments or feasibility studies, and historically such projects
have increased uncertainty and risk of failure.
SOURCE IMPACT Silver Corp.
