VANCOUVER, BC, Aug. 21,
2023 /CNW/ - Santacruz Silver Mining
Ltd. (TSXV: SCZ) ("Santacruz" or "the Company")
reports its financial and operating results for the second quarter
("Q2") of 2023. The full version of the financial statements and
accompanying Management's Discussion and Analysis (the "MD&A")
can be viewed on the Company's website at www.santacruzsilver.com
or on SEDAR+ at www.sedarplus.ca.
Q2 2023 Highlights
- Processed 443,969 tonnes of material in the quarter: 926,466
tonnes in the first half 2023;
- Produced of 5,569,535 silver equivalent ounces in the quarter:
11,213,918 silver equivalent ounces in the first half of 2023;
- Cash cost per silver ounce sold of $19.34 in the quarter: $18.29 in the first half of 2023;
- AISC per silver ounce sold of $22.89: $21.80 in
the first half of 2023;
- Revenue of $63,854,000 in the
quarter: $129,232,000 in the first
half of 2023;
- Adjusted EBITDA of $9,138,000 in
the quarter: $21,740,000 in the first
half of 2023.
Arturo Préstamo, Executive Chairman and Interim CEO of
Santacruz, commented, "The Company had another solid performance
during the second quarter with production, costs, and sales
relatively in line with the previous quarter. Mr. Préstamo
continued, "We believe there is potential to upgrade our operations
and are currently focusing on areas where we see opportunities for
further improvement. By doing this, we aim to make processes more
efficient, reduce costs, and get the most out of each of our
valuable assets."
Selected consolidated financial and operating information for
the quarter ended June 30, 2023 are
presented below. All financial information is prepared in
accordance with International Financial Reporting Standards
("IFRS"), and all dollar amounts are expressed in thousands of US
dollars, except per unit amounts, unless otherwise indicated.
2023 Second Quarter Highlights
|
2023-Q2
|
2023-Q1
|
Change
Q2 vs
Q1
|
2022-Q2
|
Change
Q2 vs
Q2
|
2023-YTD
|
2022-YTD(1)
|
Change
'23 vs
'22
|
Operational
|
|
|
|
|
|
|
|
|
Material Processed
(tonnes milled)
|
443,969
|
482,497
|
(8 %)
|
435,119
|
2 %
|
926,466
|
662,689
|
40 %
|
Silver Equivalent
Produced (ounces) (2)
|
5,569,535
|
5,644,383
|
(1 %)
|
4,922,055
|
13 %
|
11,213,918
|
6,535,775
|
72 %
|
Silver Ounces
Produced
|
1,786,461
|
1,769,520
|
1 %
|
1,410,485
|
27 %
|
3,555,981
|
1,880,314
|
89 %
|
Lead Tonnes
Produced
|
2,824
|
3,043
|
(7 %)
|
2,825
|
- %
|
5,867
|
4,169
|
41 %
|
Zinc Tonnes
Produced
|
22,281
|
22,463
|
(1 %)
|
20,433
|
9 %
|
44,744
|
26,591
|
68 %
|
Copper Tonnes
Produced
|
297
|
415
|
(28 %)
|
329
|
(10 %)
|
712
|
537
|
33 %
|
Silver Equivalent Sold
(payable ounces) (3)
|
4,087,787
|
4,380,895
|
(7 %)
|
8,605,909
|
(93 %)
|
8,468,682
|
10,470,647
|
(19 %)
|
Cash Cost of Production
per Tonne (4)
|
88.61
|
85.71
|
3 %
|
110.06
|
(19 %)
|
87.17
|
97.96
|
(11 %)
|
Cash Cost per Silver
Equivalent Ounce Sold ($/oz) (4)
|
19.34
|
17.29
|
12 %
|
15.40
|
26 %
|
18.29
|
15.79
|
16 %
|
All-in Sustaining Cash
Cost per Silver
Equivalent Ounce Sold ($/oz) (4)
|
22.89
|
20.76
|
10 %
|
17.14
|
34 %
|
21.80
|
17.67
|
23 %
|
Average Realized Price
per Ounce of Silver
Equivalent Sold ($/oz) (4) (5)
|
22.00
|
22.03
|
- %
|
21.09
|
4 %
|
22.02
|
21.55
|
2 %
|
Financial
|
|
|
|
|
|
|
|
|
Revenues
|
63,854
|
65,378
|
(2 %)
|
128,388
|
(50 %)
|
129,232
|
160,769
|
(20 %)
|
Gross Profit
|
10,976
|
14,680
|
(25 %)
|
27,957
|
(61 %)
|
25,656
|
35,973
|
(29 %)
|
Net (loss)
Income
|
1,353
|
(949)
|
243 %
|
3,834
|
(65 %)
|
404
|
4,596
|
(91 %)
|
Net Earnings (Loss) Per
Share – Basic
($/share)
|
0.00
|
0.00
|
- %
|
0.01
|
(66 %)
|
0.00
|
0.01
|
(66 %)
|
Adjusted EBITDA
(4)
|
9,138
|
12,602
|
(27 %)
|
25,440
|
(65 %)
|
21,740
|
31,543
|
(31 %)
|
Cash and Cash
Equivalent
|
7,720
|
11,988
|
(36 %)
|
4,804
|
61 %
|
7,720
|
4,804
|
61 %
|
Working Capital
(Deficiency)
|
(20,484)
|
(14,319)
|
(43 %)
|
(64,313)
|
65 %
|
(34,803)
|
(67,011)
|
48 %
|
Second Quarter 2023 Production Summary – By Mine
|
Bolivar
(6)
|
Porco
(6)
|
Caballo
Blanco
Group
|
San
Lucas
|
Zimapan
|
Consolidated
|
Material Processed
(tonnes milled)
|
66,689
|
46,085
|
74,268
|
85,258
|
171,668
|
443,969
|
Silver Equivalent
Produced (ounces) (2)
|
961,580
|
689,902
|
1,211,475
|
1,827,724
|
878,854
|
5,569,535
|
Silver Ounces
Produced
|
424,664
|
195,509
|
399,811
|
495,344
|
271,133
|
1,786,461
|
Lead Tonnes
Produced
|
302
|
214
|
825
|
635
|
849
|
2,824
|
Zinc Tonnes
Produced
|
3,323
|
3,098
|
4,804
|
8,315
|
2,741
|
22,281
|
Copper Tonnes
Produced
|
N/A
|
N/A
|
N/A
|
N/A
|
297
|
297
|
Average head grades per
mine:
|
|
|
|
|
|
|
Silver (g/t)
|
217
|
154
|
182
|
216
|
69
|
147
|
Zinc
(%)
|
5.57
|
7.15
|
6.98
|
10.69
|
2.25
|
5.66
|
Lead
(%)
|
0.62
|
0.58
|
1.44
|
1.21
|
0.67
|
0.88
|
Copper (%)
|
N/A
|
N/A
|
N/A
|
N/A
|
0.33
|
0.33
|
Silver Equivalent Sold
(payable ounces) (3)
|
408,571
|
351,919
|
762,023
|
1,978,767
|
586,507
|
4,087,787
|
Notes for both tables
above:
|
(1)
|
|
On March 18, 2022 the
Company closed the acquisition of all Bolivian assets from Glencore
and the results of the Bolivian Operations are included in the
consolidated results of the Company from that date.
|
(2)
|
|
Silver Equivalent
Produced (ounces) have been calculated using prices of $21.86/oz,
$0.91/lb, $1.52/lb and $3.67/lb for silver, lead, zinc and copper
respectively applied to the metal production divided by the silver
price.
|
(3)
|
|
Silver Equivalent Sold
(payable ounces) have been calculated using the Average Realized
Price per Ounce of Silver Equivalent Sold stated in the table
above, applied to the payable metal content of the concentrates
sold from Zimapan, Bolivar, Porco, the Caballo Blanco Group, and
San Lucas.
|
(4)
|
|
The Company reports
non-GAAP measures, which include Cash Cost of Production per Tonne,
Cash Cost per Silver Equivalent Ounce Sold, All-in Sustaining Cash
Cost per Silver Equivalent Ounce Sold, Average Realized Price per
Ounce of Silver Equivalent Sold, Adjusted EBITDA. These
measures are widely used in the mining industry as a benchmark for
performance, but do not have a standardized meaning and may differ
from methods used by other companies with similar
descriptions. See ''Non-GAAP Measures'' section below for
definitions.
|
(5)
|
|
Average Realized Price
per Ounce of Silver Equivalent Sold is prior to all treatment,
smelting and refining charges.
|
(6)
|
|
Bolivar and Porco are
presented at 100% whereas the Company records 45% of revenues and
expenses in its consolidated financial statements.
|
YTD 2022 numbers are affected by the partial quarter of Bolivian
production in Q1 2022. On March 18,
2022, the Company closed the acquisition of the Bolivian
Assets from Glencore and the results of the operations of the
Bolivian assets are included in the consolidated operational and
financial results of the Company from that date.
Production
During the quarter, the Company processed 443,969 tonnes and
silver equivalent ounces produced was 5,569,535. During the same
period last year, 435,119 tonnes of material was processed, and
4,922,055 silver equivalent ounces was produced. While total
material processed was relatively consistent when comparing Q2 2023
to Q2 2022, the larger proportion of production originating from
higher grade operations, especially San
Lucas, resulted in an increase in silver equivalent ounces
produced.
When compared to the previous quarter, there was a slight
decrease in material processed. Silver equivalent ounces produced
of 5,569,535 included 1,786,461 ounces of silver, 2,824 tonnes of
lead, 22,281 tonnes of zinc and 297 tonnes of copper. The
slight decrease in material processed was offset by an increase in
silver production from San Lucas,
which resulted in silver equivalent ounce production being in line
with the previous quarter.
Cash Cost of Production per Tonne
Consolidated cash cost of production per tonne of mineralized
material processed was $88.61 in Q2
2023 compared to $110.06 for the same
period last year. Since acquiring the Bolivian assets, the steady
increase in unit production costs at Zimapan have been offset by
significant decreases in unit production costs at the Bolivian
operations for a net reduction cash costs of 11% per
tonne.
When compared to the previous quarter, consolidated cash cost of
production per tonne of mineralized material processed increased
slightly due to the increase in unit production costs at Zimapan
which produced fewer feed tonnes due to a two-week haulage stoppage
that took place in June. This occurred when a trucking contractor
imposed a temporary work stoppage over a contract dispute, which
reduced ore extraction from the Monte mine. In addition, Zimapan
experienced higher costs due to several compounding factors
including an unfavourable exchange rate, and issues with
concentrate quality. The concentrate quality issues have been
subsequently resolved and are not expected to affect production in
Q3 2023.
Cash Cost per Silver Equivalent Ounce Sold
Cash cost per silver equivalent ounce sold in Q2 2023 was
$19.34, and was $15.40 for the same period last year. In Q2 2022,
the Company sold stockpiled concentrate due to the new offtake
agreement terms for zinc concentrate effective Q2 2022 that changed
the shipping terms from Free on Board ("FOB") to Delivered at Place
Unloaded ("DPU") basis, which resulted in revenue from the
stockpiled ore being recognized in Q2 2022. In addition, some
mining costs associated with the stockpile ore was incurred in Q1
2022. The combination of these factors reduced the cash cost per
silver ounce sold.
Consolidated results for Q2 2023 show a 12% increase in cash
costs per silver equivalent ounce sold compared to Q1 2023. This
increase is primarily a result of 7% lower ounces sold because of
the lower metal production in Q2 2023.
All-In Sustaining Cash Cost ("AISC") per Silver Equivalent
Ounce Sold
Q2 2023 AISC per silver equivalent ounce sold was $22.89, and in Q2 2022 was $17.14. The amount of stockpiled concentrate sold
in Q2 2022 as explained above had a positive effect on AISC per
silver equivalent ounce sold in that quarter.
Consolidated AISC per silver equivalent ounce sold increased 10%
quarter-on-quarter to $22.89, mainly
a result of the 7% decrease in silver equivalent ounces sold.
Bolivian consolidated AISC per silver equivalent ounce sold
increased slightly versus Q1 2023, however the increase at Zimapan
resulting from lower sales volume due to lower production increased
the consolidated Q2 2023 AISC per silver equivalent ounce sold.
About Santacruz Silver Mining Ltd.
Santacruz Silver is engaged in
the operation, acquisition, exploration, and development of mineral
properties in Latin America. The
Bolivian operations are comprised of the Bolivar, Porco and the
Caballo Blanco Group, which consists of the Tres Amigos, Reserva
and Colquechaquita mines. The Soracaya exploration project
and San Lucas ore sourcing and
trading business are also in Bolivia. The Zimapan mine is in
Mexico.
'signed'
Arturo Préstamo Elizondo,
Executive Chairman
Neither the 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 information
This news release includes certain statements and information
that may constitute forward-looking information within the meaning
of applicable Canadian securities laws. Forward-looking statements
relate to future events or future performance and reflect the
expectations or beliefs of management of the Company regarding
future events. Generally, forward-looking statements and
information can be identified by the use of forward-looking
terminology such as "intends", "expects" or "anticipates", or
variations of such words and phrases or statements that certain
actions, events or results "may", "could", "should", "would" or
will "potentially" or "likely" occur. This information and these
statements, referred to herein as "forward‐looking statements", are
not historical facts, are made as of the date of this news release
and include without limitation, statements regarding the potential
to upgrade the Company's operations, and the benefits
therefrom.
These forward‐looking statements involve numerous risks and
uncertainties and actual results might differ materially from
results suggested in any forward-looking statements. These risks
and uncertainties include, among other things, risks that the
Company will be unable to upgrade their operations as expected, or
that the Company will be unable to derive the expected benefits
from a change in its operations, risks related to changes in
general economic, business and political conditions, including
changes in the financial markets, changes in applicable laws, and
compliance with extensive government regulation, as well as
those risk factors discussed or referred to in the Company's
disclosure documents filed with the securities regulatory
authorities in certain provinces of Canada and available at
www.sedarplus.ca.
In making the forward-looking statements in this news
release, the Company has applied several material assumptions,
including without limitation, the assumption that there is
the potential to upgrade the Company's current operations, and that
an upgrade could lead to more efficient processes, reduced costs,
or improved utilization of the Company's assets.
There can be no assurance that any forward-looking
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, the reader should not place any undue
reliance on forward-looking information or statements. The Company
undertakes no obligation to update forward-looking information or
statements, other than as required by applicable law.
SOURCE Santacruz Silver Mining Ltd.