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Excellon laments "tough quarter"

Silver producer Excellon Resources (TSX:EXN) is confident new management at its flagship Platosa mine in Durango state, Mexico, will improve operations and financial metrics going forward.
Excellon laments "tough quarter" Excellon laments "tough quarter" Excellon laments "tough quarter" Excellon laments "tough quarter" Excellon laments "tough quarter"

Excellon is looking forward to improved performance at the Platosa mine, following a change of management

Staff Reporter

The company recorded a dismal September quarter after it realised surveying and planning problems were impacting production.

"Our assessment of the causes of lower production resulted in management changes at Platosa. Over the six weeks since making those changes, we have increased production and development rates and realised a number of other improvements in the operation," CEO Brendan Cahill said.

Nevertheless, the Toronto-headquartered miner managed to narrow the net loss in the period to US$3.58 million, or 4c a share, compared with a loss of $5.9 million, or 8c a share in the prior-year period.

"It was a tough quarter that is not representative of the many operational improvements made at Platosa in recent quarters," Cahill said. "In addition to lower production, financial results were impacted by lower by-product prices and associated provisional price adjustments, which have affected the whole market."

Revenues fell 63% year-over-year during the three-month period to $2.6 million, mainly owing to a 42% decrease in silver-equivalent ounces payable at 258,920oz. A $1 million negative adjustment on revenue upon the settlement of concentrate sales delivered in the second quarter at higher metal prices also weighed on the top line.

All-in sustaining costs jumped a massive 278.5% year-on-year to $44.02/oz, and was a function of the lower metal production, higher production costs, lower by-product revenue and the $1 million negative revenue adjustment to by-product credits from prior period sales.

The company's net working capital totalled $11.7 million at the end of the quarter, down from $13.8 million at the end of December 2017.

The stock fell to a fresh 12-month low Thursday, losing 4% to C70c, which gave it a market value of $70 million. Less that a year ago, the equity changed hands at $2.15 a share. The stock had lost 61% of its value in the year to date.