METS

Earnings slump as Endeavour holds onto its silver

Canada-based Endeavour Silver’s earnings have been hit by a withholding of stocks amid weaker silver prices while strong Q2 production has led to a 7% lift at the mid-point to 2022 production guidance which has provided some costs relief in the inflationary environment.

Endeavour Silver

Endeavour Silver

The company's adjusted net earnings of US$2.4 million in Q2 last year slumped some 280% to a loss of $4.3 million in the quarter this year. On a per share basis, they fell from an earning of $0.01 to a loss of $0.02 over the same period.

"During the 2nd quarter, again we made the decision to withhold from sale a meaningful amount of silver, due to the drop in silver price," Endeavour Silver's CEO Dan Dickson said.

A total of 1.6 million silver-equivalent ounces are being held which has caused a "short term" hit to earnings, he said.

Meanwhile, with its two producing mines in Mexico, Endeavour now expects to produce 7.6 million-8 million silver-equivalent ounces in 2022, which compares to its previous guidance of 6.7 million-7.6 million AgEq oz.

"We have continued to outperform our mine plans, by delivering an exceptional Q2 with production 15% above plan," the company's CEO Dan Dickson said.

"The additional production has allowed us to maintain our cost guidance on per ounce metrics, but industry-wide inflation continues to be a challenge," he said.

The 2022 all-in sustaining costs guidance stands at $20-$21/oz.

Dickson noted the largest inflationary impacts have been on energy cost, plant reagents, and steel prices.

"Cost control will continue to be a key focus as cost pressures are expected to continue for the remainder of the year," he said.

On the day of the announcement, 9 August, Endeavour's share price was down 4% day on day at C$4.68 (US$3.63). The company has a market capitalization of C$887.46 million.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.

editions

Mining Journal Intelligence Mining Equities Report 2023

Access an exclusive, inside look on the quarterly mining IPOs and secondary raisings data and mining equities performance tables with an annual Stock Exchange Comparisons supplement.

editions

Mining Journal Intelligence World Risk Report 2023 (feat. MineHutte ratings)

A detailed analysis of mining investment risks across 121 jurisdictions globally, built on 11 ‘hard risk’ metrics and an industrywide survey.

editions

Mining Journal Intelligence Global Leadership Report 2023: Social licence

Gain insights into social licence trends and best practices from interviews with 20+ top mining company executives and an industrywide survey.