11:36:34 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Silvercorp Metals Inc
Symbol SVM
Shares Issued 176,431,591
Close 2021-11-04 C$ 5.17
Market Cap C$ 912,151,325
Recent Sedar Documents

Silvercorp Metals earns $9.39M (U.S.) in fiscal Q2

2021-11-04 19:26 ET - News Release

Mr. Guoliang Ma reports

SILVERCORP REPORTS ADJUSTED NET INCOME OF $13.6 MILLION, $0.08 PER SHARE, AND CASH FLOW FROM OPERATIONS OF $30.9 MILLION FOR Q2 FISCAL 2022

Silvercorp Metals Inc. has released its financial and operating results for the second quarter ended Sept. 30, 2021 (Q2 fiscal 2022). All amounts are expressed in United States dollars, and figures may not add due to rounding.

Q2 fiscal 2022 highlights

  • Mined 292,468 tonnes of ore and milled 271,816 tonnes of ore, up 9 per cent and 3 per cent compared with the prior-year quarter.
  • Sold approximately 1.7 million ounces of silver, 800 ounces of gold, 17.3 million pounds of lead and 7.6 million pounds of zinc, representing decreases of 1 per cent, 64 per cent and 7 per cent in silver, gold and lead sold, and an increase of 3 per cent in zinc sold, compared with the prior-year quarter.
  • Revenue of $58.4-million, up 4 per cent compared with $56.4-million in the prior-year quarter.
  • Net income attributable to equity shareholders of $9.4-million, or five cents per share, compared with $15.5-million, or nine cents per share in the prior-year quarter. The decrease was mainly due to an unrealized loss of $4.1-million on investments in the current quarter compared with a gain of $2.8-million in the prior-year quarter.
  • Adjusted earnings attributable to equity shareholders of $13.6-million, or eight cents per share, compared with $15.4-million, or nine cents per share in the prior-year quarter. The adjustments were made to remove impacts from non-recurring items, share-based compensation, foreign exchange gain/loss, gain/loss on investments and the share of associates' operating results.
  • Cash flow from operations of $30.9-million, up 4 per cent or $1.3-million compared with $29.6-million in the prior-year quarter.
  • Cash cost per ounce of silver, net of byproduct credits, of negative $1.65 compared with negative $2.09 in the prior-year quarter.
  • All-in sustaining cost per ounce of silver, net of byproduct credits, of $7.35, compared with $6.99 in the prior-year quarter.
  • Strong balance sheet with $221.1-million in cash and cash equivalents and short-term investments, up $6.7-million or 3 per cent compared with $214.4-million as at June 30, 2021, and up $22.0-million or 11 per cent compared with $199.1-million as at March 31, 2021. This does not include the investments in associates and equity investment in other companies, having a total market value of $172.8-million as at Sept. 30, 2021 ($243.2-million as at June 30, 2021).

Net income attributable to equity shareholders of the company in Q2 fiscal 2022 was $9.4-million or five cents per share, compared with $15.5-million or nine cents per share in the three months ended Sept. 30, 2020 (Q2 fiscal 2021).

Adjusted earnings attributable to equity shareholders of the company in Q2 fiscal 2022 was $13.6-million, or eight cents per share, compared with $15.4-million, or nine cents per share Q2 fiscal 2021. The adjustments were made to remove the impacts from non-cash and unusual items, including elimination of share-based compensation, foreign exchange loss, share of loss in associates, gain or loss on investments, and one-time items.

Compared with Q2 fiscal 2021, the company's consolidated financial results in the current quarter were mainly impacted by i) an increase of 8 per cent, 14 per cent and 45 per cent, respectively, in the realized selling prices for gold, lead and zinc; offset by ii) a decrease of 1 per cent, 64 per cent and 7 per cent, respectively, in silver, gold and lead sold; iii) a loss of $4.1-million on investments reported in profit; iv) an average 8-per-cent appreciation of the Chinese yuan against the United States dollar, resulting in higher costs presented in U.S. dollar; v) an overall 14.5-per-cent increase in mining contractors' fee rate at the Ying mining district as previously reported in the company's news release on May 20, 2021; and vi) an average 7-per-cent increase in employees' pay rate and the contribution rate to employees' social welfare funds in China returned to the normal rate from a reduced rate granted by the Chinese government in fiscal 2021 due to COVID-19.

Revenue in Q2 fiscal 2022 was $58.4-million, up 4 per cent or $2.0-million compared with $56.4-million in Q2 fiscal 2021. The increase was mainly due to an increase of $4.7-million arising from the increase in the gold, lead and zinc net realized selling metal prices; offset by a decrease of $3.3-million arising from the decrease in the quantities of silver, gold and lead sold. Revenues from silver, gold and base metal were $32.8-million, $1.2-million and $24.4-million, respectively, compared with $33.0-million, $3.0-million and $20.3-million in Q2 fiscal 2021. Revenue from the Ying mining district was $47.1-million, up 3 per cent, compared with $45.7-million in Q2 fiscal 2021. Revenue from the GC mine was $11.3-million, up 24 per cent, compared with $9.2-million in Q2 fiscal 2021. Revenue from the BYP mine was nil, compared with $1.5-million in Q2 fiscal 2021 as the company sold all remaining gold concentrate inventories produced by the mine before it was placed on care and maintenance in 2014 in prior-year quarter.

Income from mine operations in Q2 fiscal 2022 was $23.6-million, down 11 per cent compared with $26.7-million in Q2 fiscal 2021. Income from mine operations at the Ying mining district was $19.3-million, down 16 per cent compared with $23.1-million in Q2 fiscal 2021. Income from mine operations at the GC mine was $4.5-million, up 55 per cent compared with $2.9-million in Q2 fiscal 2021.

Cash flow provided by operating activities in Q2 fiscal 2022 was $30.9-million, up 4 per cent or $1.3-million, compared with $29.6-million in Q2 fiscal 2021.

The company ended the quarter with $221.1-million in cash, cash equivalents and short-term investments, up $6.7-million or 3 per cent compared with $214.4-million as at June 30, 2021, and up 11 per cent or $22.0-million, compared with $199.1-million as at March 31, 2021.

Working capital as at Sept. 30, 2021, was $193.3-million, up 5 per cent or $9.3-million, compared with $184.0-million as at March 31, 2021.

In Q2 fiscal 2022, on a consolidated basis, the company mined 292,468 tonnes of ore, up 9 per cent or 24,615 tonnes, compared with 267,853 tonnes in Q2 fiscal 2021. Ore milled in Q2 fiscal 2022 was 271,816 tonnes, up 3 per cent or 7,883 tonnes, compared with 263,933 tonnes in Q2 fiscal 2021, but 20,832 tonnes lower than mined as a result of transportation interruptions caused by lengthy heavy rains at Ying mining district in Q2 fiscal 2022.

In Q2 fiscal 2022, the company sold approximately 1.7 million ounces of silver, 800 ounces of gold, 17.3 million pounds of lead and 7.6 million pounds of zinc, representing decreases of 1 per cent, 64 per cent and 7 per cent in silver, gold and lead sold, respectively, and an increase of 3 per cent in zinc sold, compared with approximately 1.7 million ounces of silver, 2,200 ounces of gold, 18.6 million pounds of lead and 7.4 million pounds of zinc sold in Q2 fiscal 2021. Gold sold in Q2 fiscal 2021 included 1,200 ounces from the BYP mine.

In Q2 fiscal 2022, the consolidated cash production costs per tonne of ore processed was $84.75, up 21 per cent compared with $69.82 in Q2 fiscal 2021. The consolidated all-in sustaining production cost per tonne of ore processed was $135.76, up 9 per cent, compared with $124.24 in Q2 fiscal 2021, but within the company's current annual cost guidance.

In Q2 fiscal 2022, the consolidated cash cost per ounce of silver, net of byproduct credits, was negative $1.65, compared with negative $2.09 in the prior-year quarter. The increase was mainly due to the increase in per-tonne cash production costs, offset by an increase of $1.42 in byproduct credits per ounce of silver. Sales from lead and zinc in Q2 fiscal 2022 amounted to $23.2-million, up $3.6-million, compared with $19.6-million in Q2 fiscal 2021.

The consolidated all-in sustaining cost per ounce of silver, net of byproduct credits, was $7.35, compared with $6.99 in Q2 fiscal 2021. The increase was mainly due to the increase of cash cost per ounce of silver, net of byproduct credits, offset by a decrease of $2.0-million in sustaining capital expenditures, mainly resulting from less tunnelling development.

In Q2 fiscal 2022, on a consolidated basis, a total of 124,544 metres or $6.2-million worth of diamond drilling were completed (Q2 fiscal 2021 -- 71,274 metres or $2.5-million), of which approximately 91,970 metres or $2.4-million worth of underground drilling were expensed as part of mining costs (Q2 fiscal 2021 -- 71,274 metres or $2.5-million) and approximately 32,574 metres or $3.8-million worth of drilling were capitalized (Q2 fiscal 2021 -- nil). In addition, approximately 9,953 metres or $3.4-million worth of preparation tunnelling were completed and expensed as part of mining costs (Q2 fiscal 2021 -- 7,693 metres or $1.9-million), and approximately 20,501 metres or $8.3-million worth of tunnels, raises, ramps and declines were completed and capitalized (Q2 fiscal 2021 -- 25,678 metres or $8.5-million).

In Q2 fiscal 2022, a total of 102,905 metres or $5.0-million worth of diamond drilling were completed (Q2 fiscal 2021 -- 59,540 metres or $2.0-million) at the Ying mining district, of which approximately 72,844 metres or $2.2-million worth of underground drilling were expensed as part of mining costs (Q2 fiscal 2021 -- 59,540 metres or $2.0-million) and approximately 30,061 metres or $2.8-million worth of drilling were capitalized (Q2 fiscal 2021 -- nil). In addition, approximately 7,528 metres or $2.9-million worth of preparation tunnelling were completed and expensed as part of mining costs (Q2 fiscal 2021 -- 5,316 metres or $1.6-million), and approximately 16,676 metres or $7.1-million worth of horizontal tunnels, raises, ramps and declines were completed and capitalized (Q2 fiscal 2021 -- 21,278 metres or $7.5-million).

In Q2 fiscal 2022, approximately 19,126 metres or $700,000 worth of underground diamond drilling (Q2 fiscal 2021 -- 11,734 metres or $500,000) and 2,425 metres or $400,000 of tunnelling (Q2 fiscal 2021 -- 2,377 metres or $300,000) were completed and expensed as mining preparation costs at the GC mine. In addition, approximately 3,825 metres or $1.2-million of horizontal tunnels, raises and declines were completed and capitalized (Q2 fiscal 2021 -- 4,400 metres or $1.0-million).

Updates

In October, 2021, the SGX mine at the Ying mining district suspended production temporarily as a precautionary measure due to the heavy rainfall experienced in the Yellow River region. The water level at the nearby reservoir that discharges into the Yellow River reached an all-time high, causing the operations at the SGX mine to be suspended for 10 days, impacting production and ore head grades. Despite this interruption, the company expects to maintain a similar mining production rate as achieved in Q2 fiscal 2022 and increase the milling tonnage at the Ying mining district in the third quarter of fiscal 2022.

As announced on Oct. 13, 2021, the company, through a 100-per-cent-owned subsidiary of Henan Found, won an on-line auction to acquire the Kuanping project for a total of $13.5-million. The acquisition is not subject to the national security clearance as Henan Found's subsidiary is considered as a domestic company in China. The company paid the consideration in October, 2021, and expects to complete the acquisition in November, 2021.

Conference call details

A conference call to discuss these results will be held tomorrow, Friday, Nov. 5, at 9 a.m. PT (12 p.m. ET). To participate in the conference call, please dial the numbers below.

Canada/United States toll-free:  888-664-6383

International toll:  416-764-8650

Conference ID:  03881964

Participants should dial in 10 to 15 minutes prior to the start time. A replay of the conference call and transcript will be available on the company's website.

Guoliang Ma, PGeo, manager of exploration and resources of the company, is the qualified person as defined by National Instrument 43-101 -- Standards of Disclosure for Mineral Projects and has reviewed and consented to the technical information contained in this news release.

This earnings release should be read in conjunction with the company's management discussion and analysis (MD&A), financial statements, and notes to financial statements for the three and six months ended Sept. 30, 2021, which have been posted on SEDAR under the company's profile on SEDAR and are also available on the company's website under the investor section. This earnings release refers to various alternative performance (non-IFRS (international financial reporting standards)) measures, such as adjusted earnings and adjusted earnings per share, cash cost and all-in sustaining cost per ounce of silver, net of byproduct credits, cash production cost, and all-in sustaining production cost per tonne of ore processed and working capital. These measures are widely used in the mining industry as a benchmark for performance, but do not have standardized meanings under IFRS as an indicator of performance and may differ from methods used by other companies with similar description. The detailed description and reconciliation of these alternative performance (non-IFRS) measures have been incorporated by reference and can be found on page 24, Section 11 -- alternative performance (non-IFRS) measures in the MD&A for the three and six months ended Sept. 30, 2021.

About Silvercorp Metals Inc.

Silvercorp is a profitable Canadian mining company, producing silver, lead and zinc metals in concentrates from mines in China. The company's goal is to continuously create healthy returns to shareholders through efficient management, organic growth and the acquisition of profitable projects. Silvercorp balances profitability, social and environmental relationships, employees' well-being, and sustainable development.

We seek Safe Harbor.

© 2024 Canjex Publishing Ltd. All rights reserved.