It's the biggest company you've never heard of—until last week, that is. Evergrande Group, the "too big to fail" Chinese property developer, rattled markets last Monday when it missed interest payments to at least two of its lenders. This gave more than a few investors flashbacks to Lehman Brothers' demise in 2008, which helped trigger the global financial crisis. The selloff spread to U.S. markets, and I was pleased to see that gold maintained its haven status. The yellow metal ended the day slightly up more than half a percent, passing an important "stress test" of its investment case in the age of Bitcoin. Read More >>
Early Warning Report Regarding Guanajuato Silver Company Ltd.
This news release is being disseminated by Endeavour Silver Corp. (TSX: EDR, NYSE: EXK) (" Endeavour ") pursuant to National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues in connection with the acquisition by Endeavour of certain securities of Guanajuato Silver Company Ltd. (" GSilver "), a British Columbia corporation with a head office at 578-999 Canada Place, Vancouver, British Columbia, V6C 3E1.
On November 30, 2021, Endeavour acquired 5,750,000 units (" Units ") of GSilver at a purchase price of $0.55 per Unit through a non-brokered private placement (the " Private Placement ") for an aggregate purchase price of $3,162,500. Each Unit consists of one common share (a " Common Share ") of GSilver and one-half of a common share purchase warrant (each whole warrant, a " Warrant "). Each Warrant entitles the holder to purchase one Common Share at a price of $0.75 per Common Share at any time on or before November 30, 2023.
In addition, on November 30, 2021, in connection with GSilver's early payment of a US$2.5 million promissory note (the " Note ") issued to Endeavour in connection with GSilver's acquisition of the El Cubo mine and mill complex (" El Cubo ") as announced by GSilver on November 16, 2021, Endeavour acquired 901,224 Common Shares (the " Settlement Shares ") at a deemed price of $0.55 per Settlement Share. The Settlement Shares were issued by GSilver to settle the Mexican value added tax (" VAT ") payable on the purchase price for El Cubo represented by the Note (the " Note Settlement ").
Before completion of the Private Placement and Note Settlement, Endeavour owned 21,331,058 Common Shares. Such Common Shares represented approximately 10.37% of the issued and outstanding Common Shares prior to the completion of the Private Placement and Note Settlement.
Immediately after completion of the Private Placement and Note Settlement, Endeavour owned 27,982,282 Common Shares and 2,875,000 Warrants. The Common Shares owned by Endeavour following the completion of the Private Placement and Note Settlement represent approximately 12.63% of the issued and outstanding Common Shares. If exercised, the 2,875,000 Warrants together with the 27,982,282 Common Shares owned by Endeavour would represent approximately 13.75% of the issued and outstanding Common Shares (after giving effect to the exercise of such Warrants, but not the exercise of any other common share purchase warrants or convertible securities issued by GSilver).
Endeavour's acquisition of securities of GSilver was made for long term investment purposes and Endeavour will continue to monitor the business, prospects, financial condition and potential capital requirements of GSilver. Endeavour may from time to time in the future increase or decrease its direct or indirect ownership, control or direction over the Common Shares or other securities of GSilver through market transactions, private agreements, dilution through third party subscriptions from treasury, or otherwise.
About Endeavour Silver – Endeavour Silver Corp. is a mid-tier precious metals mining company that operates two high-grade, underground, silver-gold mines in Mexico. Endeavour is currently advancing the Terronera mine project towards a development decision, pending financing and final permits and exploring its portfolio of exploration and development projects in Mexico, Chile and the United States to facilitate its goal to become a premier senior silver producer. Our philosophy of corporate social integrity creates value for all stakeholders.
SOURCE Endeavour Silver Corp.
Endeavour will file an early warning report in connection with the transactions referenced herein on SEDAR at www.sedar.com . A copy of the report may be obtained by contacting Galina Meleger at:
Contact Information
Galina Meleger, Vice President, Investor Relations
Toll free: (877) 685-9775
Tel: (604) 640-4804
Email: gmeleger@edrsilver.com
Website: www.edrsilver.com
Follow Endeavour Silver on Facebook , Twitter , Instagram and LinkedIn
News Provided by GlobeNewswire via QuoteMedia
First Majestic Completes US$230 Million Convertible Senior Notes Offering
First Majestic Silver Corp. (NYSE: AG) (TSX: FR) ("First Majestic" or the "Company") announced today the closing of its previously announced offering of US$200 million aggregate principal amount of 0.375% unsecured convertible senior notes due in 2027 (the "Notes"). The Company also announced the concurrent closing of an additional US$30 million aggregate principal amount of the Notes pursuant to the exercise in full of the over-allotment option granted to the initial purchasers of the Notes. The initial conversion rate for the Notes is 60.3865 common shares ("Shares") per US$1,000 principal amount of Notes, equivalent to an initial conversion price of approximately US$16.56 per Share.
The Company will use a portion of the proceeds of the Offering to complete the repurchase, in separate privately negotiated transactions, of approximately US$125.2 million aggregate principal amount of its outstanding 1.875% convertible senior notes (the "Existing Notes") for payment of approximately US$164.9 million. The Company intends to use the remainder of the net proceeds from the Offering for general corporate purposes, including strategic opportunities.
In accordance with the terms of the Existing Notes, First Majestic has provided notice that it will redeem all Existing Notes that are not converted or repurchased in conjunction with the Offering. The effective date of the redemption will be December 30, 2021.
The Notes and the Shares into which the Notes are convertible, have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or qualified by a prospectus in Canada. The Notes and the Shares may not be offered or sold in the United States absent registration under the Securities Act or an applicable exemption from registration under the Securities Act and may not be offered or sold in Canada except pursuant to exemptions from the prospectus requirements of applicable Canadian provincial and territorial securities laws.
This news release is neither an offer to sell nor the solicitation of an offer to buy the Notes or the Shares into which the Notes are convertible, and shall not constitute an offer to sell or solicitation of an offer to buy, or a sale of, the Notes or the Shares into which the Notes are convertible in any jurisdiction in which such offer, solicitation or sale is unlawful.
ABOUT THE COMPANY
First Majestic is a publicly traded mining company focused on silver and gold production in Mexico and the United States. The Company presently owns and operates the San Dimas Silver/Gold Mine, the Jerritt Canyon Gold Mine, the Santa Elena Silver/Gold Mine and the La Encantada Silver Mine.
For further information contact info@firstmajestic.com or call Investor Relations at 1-866-529-2807.
FIRST MAJESTIC SILVER CORP.
"signed"
Keith Neumeyer, President & CEO
Forward-Looking Statements
This press release contains "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995 or forward looking information within the meaning of applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of First Majestic. Forward-looking statements include, but are not limited to, statements with respect to the proposed use of proceeds of the Offering and the redemption of the Existing Notes. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of First Majestic to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the integration of acquisitions; risks related to international operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of metals; possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section entitled "Description of Business - Risk Factors" in First Majestic's Annual Information Form for the year ended December 31, 2020, available on www.sedar.com, and Form 40-F on file with the United States Securities and Exchange Commission in Washington, D.C. Although First Majestic has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. First Majestic does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/106264
News Provided by Newsfile via QuoteMedia
Endeavour Silver Intersects High-Grade Silver-Gold Mineralization at its Guanacevi and Bolañitos Operations
Endeavour Silver Corp. (TSX: EDR, NYSE: EXK) is pleased to report continued high-grade drill results from its 2021 exploration program at the Guanacevi Mine in Durango State, Mexico and the Bolañitos Mine in Guanajuato State, Mexico. Exploration drilling is ongoing at both operations and will continue in 2022.
Highlights from Recent Drill Results
Guanacevi
- 1.97 gpt Au and 1,254 gpt Ag for 1,412 gpt AgEq over a 3.22 m ETW, including 3.6 gpt Au and 2,690 gpt Ag for 2,978 gpt AgEq over 0.2 m (UCM-67), extending the El Curso orebody along strike
- 4.36 gpt Au and 1,450 gpt Ag for 1,798 gpt AgEq over a 3.18 m ETW , including 7.97 gpt Au and 4,568 gpt Ag for 5,206 gpt AgEq over 0.31 m (SCSU-11), extending the Santa Cruz South (SCS) orebody to depth
Bolañitos
- 8.08 gpt Au and 151 gpt Ag for 797 gpt AgEq over a 1.67 m ETW , including 89.6 gpt Au and 880 gpt Ag for 8,046 gpt AgEq over 0.08 m (BS-04), on a new discovery, the Tepetateras vein, located south of current workings
- 1.26 gpt gold and 241 gpt silver for 342 gpt AgEq over a 0.96 m ETW (BS-03), on the Lulu vein, south of current workings
Abbreviations include: gpt: grams per tonne; Au: gold; Ag: silver; ETW: estimated true width; m: metre; HW: hanging wall. Silver equivalents are calculated at a ratio of 80:1 silver:gold.
Dan Dickson, CEO, commented, "We continue to see exceptional drilling results within the El Curso and the Santa Cruz Sur systems at our Guanacevi silver mine. We have been operating at Guanacevi for more than 15 years and these encouraging results support our view that we can continue to extend the mine life."
Mr. Dickson continued, "Endeavour was built on the drill bit and exploration will continue to be a cornerstone of our strategy as we pursue our vision of being a premier senior silver producer."
At Guanacevi, underground drilling continues to expand down plunge extensions of the El Curso and the Santa Cruz South (SCS) orebodies (view Guanacevi longitudinal sections ). From January through October, more than 14,000 metres in 38 holes have been drilled at Guanacevi from underground.
At Bolañitos, surface and underground drilling has intersected multiple mineralized structures near current workings (view Bolanitos longitudinal sections ). Tepetateras is a new area south of Bolañitos situated 1.7 kilometres from Endeavour Silver's historic Golondrinas Mine. Since the beginning of the year, over 11,500 metres in 59 holes have been drilled at Bolañitos identifying mineralization in structures near current workings.
Guanacevi - El Curso drill results are summarized in the following table:
| Hole | Structure | From | True Width | Au | Ag | AgEq |
| (m) | (m) | (gpt) | (gpt) | (gpt) | ||
| UCM-65 | Santa Cruz | 219.50 | 2.45 | 1.77 | 736 | 878 |
| Including | 222.85 | 0.25 | 5.05 | 1,973 | 2,377 | |
| UCM-66 | Santa Cruz | 306.90 | 2.72 | 1.62 | 550 | 680 |
| Including | 311.30 | 0.29 | 3.64 | 1,376 | 1,667 | |
| UCM-67 | Santa Cruz | 295.15 | 3.22 | 1.97 | 1,254 | 1,412 |
| Including | 301.90 | 0.23 | 3.60 | 2,690 | 2,978 | |
| UCM-68 | Santa Cruz | 280.50 | 1.49 | 0.56 | 374 | 419 |
| Including | 282.95 | 0.42 | 1.18 | 887 | 981 | |
| UCM-69 | Santa Cruz | 295.15 | 2.00 | 0.84 | 338 | 405 |
| Including | 297.70 | 0.21 | 1.56 | 567 | 692 | |
| UCM-71 | Santa Cruz | 281.45 | 1.58 | 0.52 | 187 | 229 |
| Including | 282.10 | 0.25 | 1.83 | 550 | 697 | |
| UCM-74 | Santa Cruz | 363.85 | 1.11 | 0.53 | 156 | 198 |
| Including | 365.30 | 0.23 | 1.31 | 372 | 477 | |
| UCM-80 | Santa Cruz | 260.60 | 1.90 | 6.64 | 1,977 | 2,508 |
| Including | 261.90 | 0.42 | 15.35 | 5,320 | 6,548 | |
| UCM-84 | Santa Cruz | 260.30 | 0.92 | 0.57 | 309 | 354 |
| Including | 261.20 | 0.39 | 1.12 | 578 | 667 |
Note: Drill holes UCM-70, UCM-72, UCM-73, UCM-75, UCM-76, UCM-77, UCM-78, UCM-79, UCM-81, UCM-82 returned no significant results
Guanacevi - SCS drill results are summarized in the following table:
| Hole | Structure | From | True Width | Au | Ag | AgEq |
| (m) | (m) | (gpt) | (gpt) | (gpt) | ||
| SCSU-01 | Santa Cruz | 98.50 | 1.74 | 1.26 | 326 | 426 |
| Including | 99.30 | 0.27 | 3.44 | 650 | 926 | |
| SCSU-02 | Santa Cruz | 95.20 | 2.57 | 1.14 | 533 | 624 |
| Including | 95.20 | 0.64 | 1.69 | 1,290 | 1,425 | |
| SCSU-03 | Santa Cruz | 122.85 | 1.17 | 0.18 | 120 | 135 |
| Including | 123.50 | 0.71 | 0.19 | 148 | 164 | |
| SCSU-04 | Santa Cruz | 159.30 | 1.86 | 1.39 | 608 | 720 |
| Including | 159.80 | 0.34 | 2.30 | 1,037 | 1,221 | |
| SCSU-05 | Santa Cruz | 157.05 | 1.12 | 0.20 | 109 | 125 |
| Including | 157.85 | 0.46 | 0.38 | 130 | 161 | |
| SCSU-08 | Santa Cruz | 224.90 | 1.00 | 0.13 | 95 | 105 |
| Including | 225.80 | 0.33 | 0.15 | 111 | 123 | |
| SCSU-10 | Santa Cruz | 179.10 | 0.98 | 2.08 | 52 | 218 |
| Including | 179.85 | 0.24 | 4.15 | 63 | 395 | |
| SCSU-11 | Santa Cruz | 136.50 | 3.18 | 4.36 | 1,450 | 1,798 |
| Including | 138.60 | 0.31 | 7.97 | 4,568 | 5,206 | |
| SCSU-12 | Santa Cruz | 136.00 | 1.26 | 1.54 | 341 | 464 |
| Including | 136.00 | 0.48 | 3.11 | 672 | 921 | |
| SCSU-14 | Santa Cruz | 173.35 | 2.17 | 0.26 | 193 | 213 |
| Including | 173.35 | 0.67 | 0.35 | 218 | 245 |
Note: Drill holes SCSU-06, SCSU-07, SCSU-09, SCSU-13 returned no significant results
Bolañitos - South drill results are summarized in the following table:
| Hole | Structure | From | True Width | Au | Ag | AgEq |
| (m) | (m) | (gpt) | (gpt) | (gpt) | ||
| BS-01 | HW Cabrera Carrica | 154.20 | 1.36 | 0.41 | 169 | 202 |
| Including | 155.30 | 0.48 | 0.24 | 213 | 233 | |
| BS-02 | HW Cabrera Carrica | 190.25 | 1.17 | 0.77 | 52 | 114 |
| Including | 190.25 | 0.31 | 1.86 | 165 | 314 | |
| BS-03 | Lulú | 74.30 | 0.96 | 1.26 | 241 | 342 |
| Including | 74.30 | 0.11 | 2.94 | 789 | 1025 | |
| BS-04 | Tepetateras | 137.70 | 1.67 | 8.08 | 151 | 797 |
| Including | 140.25 | 0.08 | 89.58 | 880 | 8046 | |
| BS-05 | Lulú | 20.80 | 0.93 | 0.28 | 104 | 126 |
| Including | 22.00 | 0.13 | 1.46 | 386 | 502 | |
| BS-09 | Tepetateras | 178.10 | 3.39 | 2.63 | 82 | 292 |
| Including | 186.50 | 0.10 | 16.65 | 95 | 1427 | |
| BS-10 | Tepetateras | 181.45 | 0.95 | 1.01 | 43 | 124 |
| Including | 182.70 | 0.29 | 2.34 | 116 | 303 | |
| BS-13 | Tepetateras | 238.65 | 1.09 | 1.73 | 5 | 143 |
| Including | 240.05 | 0.19 | 6.02 | 11 | 493 | |
| BS-15 | Tepetateras | 151.50 | 1.39 | 1.22 | 119 | 216 |
| Including | 153.40 | 0.29 | 3.52 | 238 | 520 | |
| BS-16 | Cabrera Carrica | 182.80 | 1.00 | 0.22 | 87 | 104 |
| Including | 182.80 | 0.77 | 0.25 | 102 | 122 | |
| BS-19 | Tepetateras | 99.60 | 1.39 | 1.43 | 217 | 331 |
| Including | 99.60 | 1.10 | 1.80 | 258 | 402 | |
| Lulú | 107.50 | 1.03 | 0.14 | 327 | 338 | |
| Including | 107.80 | 0.80 | 0.15 | 331 | 343 |
Note: Drill holes LS-01, LS-02, LS-03, LS-04, BS-06, BS-07, BS-08, BS-11, BS-12, BS-14, BS-17, BNU-01, BNU-02, BNU-03 returned no significant results
Bolañitos - Belén drill results are summarized in the following table:
| Hole | Structure | From | True Width | Au | Ag | AgEq |
| (m) | (m) | (gpt) | (gpt) | (gpt) | ||
| BL1S-6 | HW Belén | 176.25 | 1.11 | 1.16 | 20 | 113 |
| Including | 176.55 | 0.33 | 2.12 | 28 | 198 | |
| Belén | 236.15 | 1.62 | 1.39 | 33 | 144 | |
| Including | 236.15 | 0.31 | 4.11 | 113 | 442 | |
| BL0.5S-1 | HW Belén | 97.00 | 1.06 | 2.49 | 73 | 272 |
| Including | 97.00 | 0.30 | 6.62 | 160 | 690 |
Note: Drill holes BL1.5-1, BL1.5-2, BL0.5-3, BL4.5S-1 returned no significant results
Silver equivalents are calculated at a ratio of 80:1 silver:gold. All widths are estimated true widths.
Qualified Person and QA/QC - Dale Mah, P.Geo., Vice President Corporate Development of Endeavour Silver, is the Qualified Person who reviewed and approved the technical information contained in this news release. A quality control sampling program of reference standards, blanks and duplicates has been instituted to monitor the integrity of all assay results. All samples are split at the local field office and shipped to SGS Labs, where they are dried, crushed, split and 250 gram pulp samples are prepared for analysis. Gold is determined by fire assay with an atomic absorption finish and silver by aqua regia digestion with ICP finish, over-limits by fire assay and gravimetric finish.
About Endeavour Silver – Endeavour Silver is a mid-tier precious metals mining company that operates two high-grade, underground, silver-gold mines in Mexico. Endeavour is currently advancing the Terronera mine project towards a development decision, pending financing and final permits and exploring its portfolio of exploration and development projects in Mexico, Chile and the United States to facilitate its goal to become a premier senior silver producer. Our philosophy of corporate social integrity creates value for all stakeholders.
SOURCE Endeavour Silver Corp.
Contact Information
Galina Meleger, Vice President, Investor Relations
Toll free: (877) 685-9775
Tel: (604) 640-4804
Email: gmeleger@edrsilver.com
Website: www.edrsilver.com
Follow Endeavour Silver on Facebook , Twitter , Instagram and LinkedIn
Cautionary Note Regarding Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of the United States private securities litigation reform act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Such forward-looking statements and information herein include but are not limited to statements regarding future prospects of the Company's mines and projects. The Company does not intend to and does not assume any obligation to update such forward-looking statements or information, other than as required by applicable law.
Forward-looking statements or information involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, production levels, performance or achievements to be materially different from those expressed or implied by such statements. Such factors include but are not limited to the ultimate impact of the COVID 19 pandemic on operations and results, changes in production and costs guidance, national and local governments, legislation, taxation, controls, regulations and political or economic developments in Canada and Mexico; financial risks due to precious metals prices, operating or technical difficulties in mineral exploration, development and mining activities; risks and hazards of mineral exploration, development and mining; the speculative nature of mineral exploration and development and risks in obtaining necessary licenses and permits,
Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to: the continued exploration and mining operations, no material adverse change in the market price of commodities, mining operations will operate and the mining products will be completed in accordance with management's expectations and achieve their stated production outcomes, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or information, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended. There can be no assurance that any forward-looking statements or information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.
News Provided by GlobeNewswire via QuoteMedia
Santacruz Silver Reports Third Quarter 2021 Financial Results
Santacruz Silver Mining Ltd. (TSXV: SCZ) ("the Company" or "Santacruz") reports its financial and operating results for the third quarter ("Q3") of 2021. The full version of the consolidated financial statements and accompanying management discussion and analysis ("MD&A") can be viewed on the Company's website at www.santacruzsilver.com or on SEDAR at www.sedar.com. All financial information is prepared in accordance with International Financial Reporting Standards ("IFRS") and all dollar amounts are expressed in thousands of United States dollars, except per unit amounts, unless otherwise indicated.
- Revenues increased by 55% to $14.6 million during Q3 2021 (Q3 2020 - $9.4 million).
- Gross profit increased by 190% to $3.7 million during Q3 2021 (Q3 2020 - $1.3 million).
- On October 13, 2021, the Company announced it had entered into a definitive share purchase agreement with Glencore plc whereby Santacruz has the right to acquire a portfolio of Bolivian silver-base metal assets from Glencore plc.
Carlos Silva, CEO of Santacruz, stated; "We continue to increase our mine production and revenue for the third and fifth consecutive quarter respectively. Production costs were impacted as a result of a Mexican labour reform that came into effect during the quarter. This labour reform required the Company to recognize certain labour liability accruals for their employees, including but not limited to vacation, holiday bonuses, annual bonuses, savings funds, and seniority departure payments which totaled approximately $1.3 million. In addition, a non-recurring charge to administrative expenses of $0.4 million related to severance payments resulting from the decision to place the Rosario mine on care and maintenance, various non-recurring costs associated with the Zimapan Mine acquisition and other non-cash charges also impacted the quarter-end results."
Financial Results
Selected financial information for the three-month periods ended September 30, June 30 and March 31, 2021 and December 31 and September 30, 2020 is presented below:
| 2021 | 2020 | Q3 2021 % Change vs | |||||
| Q3 | Q2 | Q1 | Q4 | Q3 | Q2 2021 | Q3 2020 | |
| Revenue - Mining Operations | 14,601 | 13,744 | 11,168 | 9,905 | 9,437 | 6% | 55% |
| Gross Profit (Loss) (1) | 3,656 | 3,840 | 2,181 | 807 | 1,259 | -5% | 190% |
| Net (Loss) Income | (3,849) | (3,784) | 6,518 | (607) | (163) | 2% | 2,261% |
| Net (Loss) Earnings Per Share - Basic ($/share) | (0.01) | (0.01) | 0.02 | 0.00 | 0.00 | - | - |
| Adjusted EBITDA (1) | 1,263 | 2,270 | 1,649 | 1,090 | 1,046 | -44% | 21% |
| Working Capital Deficiency | (12,671) | (11,665) | (16,478) | (22,514) | (31,038) | 9% | -59% |
(1) The Company reports additional non-IFRS measures which include Gross Profit (Loss) and Adjusted EBITDA. These additional financial disclosure measures are intended to provide additional information. See the Company's MD&A filed on SEDAR or its website for a reconciliation of these amounts to the unaudited interim financial statements for the respective periods.
As compared to Q2 2021, the Q3 2021 working capital deficiency has increased by 9%. The Company has capital management processes in place to manage liquidity risk.
Selected financial information for the Zimapan Mine and Rosario Project for the three months ended September 30, June 30 and March 31, 2021 and December 31 and September 30, 2020 is presented below:
| 2021 | 2020 | Q3 2021 % Change vs | ||||||
| Q3 | Q2 | Q1 | Q4 | Q3 | Q2 2021 | Q3 2020 | ||
| Revenue | - Zimapan Mine | 14,419 | 13,022 | 10,442 | 8,772 | 8,982 | 11% | 61% |
| - Rosario Project | 182 | 410 | 1,011 | 1,445 | 642 | -56% | -72% | |
| Gross profit (loss) | - Zimapan Mine | 3,928 | 4,401 | 2,581 | 496 | 1,964 | -11% | 100% |
| - Rosario Project | (272) | (873) | (115) | 220 | (705) | -69% | -61% | |
Operating Results
Selected operating results for the Zimapan Mine and Rosario Project for the three months ended September 30, June 30 and March 31, 2021 and December 31 and September 30, 2020 is presented below:
| 2021 | 2020 | Q3 2021 % Change vs | |||||
| Q3 | Q2 | Q1 | Q4 | Q3 | Q2 2021 | Q3 2020 | |
| Material Processed (tonnes milled) (4) | |||||||
| Zimapan Mine | 186,642 | 155,407 | 156,433 | 180,003 | 164,846 | 20% | 13% |
| Rosario Project (5) | 2,306 | 16,917 | 19,806 | 21,582 | 11,794 | -86% | -80% |
| Consolidated | 188,948 | 172,324 | 176,239 | 201,585 | 176,640 | 10% | 7% |
| Silver Equivalent Produced (ounces) (1) (3) (4) | |||||||
| Zimapan Mine | 867,215 | 757,937 | 646,085 | 909,379 | 920,985 | 14% | -6% |
| Rosario Project (5) | 5,698 | 41,120 | 60,893 | 90,863 | 56,693 | -86% | -90% |
| Consolidated | 872,913 | 799,057 | 706,978 | 1,000,242 | 977,678 | 9% | -11% |
| Silver Equivalent Sold (payable ounces) (4) | |||||||
| Zimapan Mine | 829,164 | 658,590 | 553,450 | 545,580 | 625,036 | 26% | 33% |
| Rosario Project (5) | 10,765 | 20,328 | 52,520 | 74,511 | 36,628 | -47% | -71% |
| Consolidated | 839,929 | 678,918 | 605,970 | 620,091 | 661,664 | 24% | 27% |
| Cash Cost of Production per Tonne (2) (4) | |||||||
| Zimapan Mine | 53.88 | 53.92 | 49.04 | 48.90 | 39.91 | - | 35% |
| Rosario Project (5) | 173.04 | 69.81 | 57.86 | 59.68 | 87.08 | 148% | 99% |
| Consolidated | 55.33 | 55.48 | 50.03 | 50.06 | 43.06 | - | 29% |
| Cash Cost per Silver Equivalent Ounce (2) (4) | |||||||
| Zimapan Mine | 17,72 | 18.37 | 19.91 | 23.21 | 17.45 | -4% | 2% |
| Rosario Project (5) | 42.81 | 68.58 | 27.19 | 21.82 | 34.13 | -38% | 25% |
| Consolidated | 18.04 | 19.87 | 20.54 | 23.04 | 18.38 | -9% | -2% |
| All-in Sustaining Cash Cost per Silver Equivalent Oz (2) (4) | |||||||
| Zimapan Mine | 21.33 | 21.35 | 21.03 | 24.95 | 18.54 | - | 15% |
| Rosario Project (5) | 67.27 | 101.19 | 52.57 | 47.63 | 42.07 | 34% | 60% |
| Consolidated | 21.91 | 23.74 | 23.76 | 27.67 | 19.85 | -8% | 10% |
| Average Realized Silver Price per Ounce (2) (4) | |||||||
| Zimapan Mine | 22.81 | 25.67 | 25.07 | 23.98 | 21.01 | -11% | 9% |
| Rosario Project (5) | 22.47 | 25.63 | 25.00 | 24.56 | 24.08 | -12% | -7% |
| Consolidated | 22.81 | 25.67 | 25.06 | 24.05 | 21.18 | -11% | 8% |
(1)Silver equivalent ounces produced in 2021 have been calculated using prices of $25.00/oz, $1,925/oz, $0.85/lb, $1.05/lb, and $3.00/lb for silver, gold, lead, zinc and copper respectively applied to the metal content of the concentrates produced by the Rosario Project and the Zimapan Mine. Silver equivalent ounces produced in 2020 have been calculated using prices of $17.85/oz, $1,480/oz, $0.92/lb, $1.09/lb and $2.80/lb for silver, gold, lead, zinc and copper respectively applied to the metal content of the concentrates produced by the Rosario Project and the Zimapan Mine.
(2) Silver equivalent sold ounces have been calculated using the realized silver prices stated in the table above, applied to the payable metal content of the concentrates sold from the Zimapan Mine and Rosario Project in 2021 and 2020.
(3) The Company reports non-IFRS measures which include Cash Cost per Silver Equivalent, All-in Sustaining Cash Cost per Silver Equivalent, Cash Cost of Production per Tonne, and Average Realized Silver Price per Ounce. 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 the Company's MD&A filed on SEDAR or its website for a discussion of these amounts.
(4) The Company is not including production and unit cost results from the Veta Grande Project in this MD&A as operations at Veta Grande were suspended during Q1 2020 and to date have not recommenced.
(5) Operations at the Rosario Project are suspended and there was minimal production in July 2021 and no production in August and September 2021.
Discussion of Financial Results
The Company recorded a net loss of $3,849 for Q3 2021 (Q3 2020 - $163) and a gross operating profit of $3,656 (Q3 2020 - $1,259). The gross profit increase reflects a 100% increase in gross profit at the Zimapan Mine driven by a 61% increase in revenue that arose as a result of improved metal prices and significant increases in production of silver, zinc and copper as compared to Q3 2020.
The increase in net loss resulted primarily from a $2,066 increase in operating expenses, a $1,163 increase in net finance expense, a $1,014 increase in loss on foreign exchange, and a $1,836 unrealized loss on marketable securities from Q3 2020. Operating expenses increased primarily due to the growth in the Company in addition to non-recurring costs associated with the Zimapan Mine acquisition and a $431 charge in administrative severance costs paid as a result of placing the Rosario Project on care and maintenance. Also impacting operating expense is a $466 increase in share-based compensation as a result of additional stock options granted compared to Q3 2020. The increase in net finance expense is primarily due to a $665 increase IVA recovery inflationary loss which results from changes in the Mexican inflation rate, an additional $162 in interest charges associated with the increased Trafigura loan balance compared to Q3 2020 and an additional $169 of accretion of the Zimapan Mine decommissioning and restoration provision.
Also impacting the net loss for Q3 2021 are production costs resulting from a non-recurring charge of $1,294 due to a Mexican labour reform that became effective September 2021. The Company was required to recognize certain labour liability accruals for their employees, including but not limited to vacation, holiday bonuses, annual bonuses, savings funds and seniority departure payments.
Discussion of Operational Results and Costs
Zimapan Mine
As compared to Q3 2020, the Q3 2021 silver equivalent production decreased by 6% due to the impact of using different metal price decks for the respective 2021 and 2020 fiscal years. The Q3 2021 silver equivalent production increased by 20% (after adjusting for the metal price deck) as compared to Q3 2020.
As compared to Q2 2021, the Q3 2021 silver equivalent production increased 14%. This increase arose primarily as a result of a 20% increase in tonnes milled during the period.
Operations during Q2 2021 reflect reduced milling availability with operations negatively impacted by challenges with the dewatering circuit. This was remedied in early Q3 as a result of replacing the original drum filters with a filter press. The impact of this change in equipment was immediate as production for July 2021 improved to over 60,000 tonnes of material processed at the milling facility with August and September seeing further production improvements.
The cash cost of production per tonne of mineralized material processed increased by 35% in Q3 2021 to $53.88/t as compared to Q3 2020. This resulted from a 53% increase in the cash cost of production which included a non-recurring charge of $6.93/t due to a Mexican labour reform that came into effect during the quarter, offset by a 13% increase in the tonnes of mineralized material processed.
As compared to Q2 2021, the cash cost of production per tonne of mineralized material processed decreased by $0.04/t. This result reflects a 20% increase in the cash cost of production offset by a 20% increase in the tonnes of mineralized material processed during Q3 2021.
The cash cost of production per silver equivalent ounce sold increased by 2% to $17.72/oz in Q3 2021 compared to Q3 2020. This resulted from a 35% increase in the cash cost of sales of silver equivalent ounces which included a non-recurring charge of $1.56/oz due to the Mexican labour reform that came into effect during the quarter, while the silver equivalent payable ounce produced increased by 33%.
As compared to Q2 2021, the cash cost of production per silver equivalent ounce sold in Q3 2021 decreased by 4%. This resulted from a 21% increase in the cash cost of sales of silver equivalent ounces while the silver equivalent payable ounces produced increased by 26%. As noted earlier, the increase in silver equivalent production arose primarily as a result of a 20% increase in tonnes milled during the period.
All-in sustaining cash cost of production per silver equivalent ounce sold increased by 15% to $21.33/oz as compared to Q3 2020. This resulted from a 51% increase in the cash cost of sales which included a non-recurring charge of $1.56/oz due to the Mexican labour reform that came into effect during the quarter, while the silver equivalent payable ounces produced increased by 33%.
As compared to Q2 2021, the AISC in Q3 2021 decreased by $0.02/oz. This resulted from a 24% increase in the cash cost of sales of silver equivalent ounces while the silver equivalent payable ounces sold increased by 26%. This change occurred largely for the same reasons as referenced above in the discussion regarding cash cost of silver equivalent ounces sold.
Production at the Zimapan Mine is not supported by a feasibility study on mineral reserves demonstrating economic and technical viability or any other independent economic study under NI 43-101. Accordingly, there is increased uncertainty and economic and technical risks of failure associated with production operations at the Zimapan Mine. Production and economic variables may vary considerably due to the absence of a complete and detailed site analysis in accordance with NI 43-101.
Rosario Project
As compared to Q2 2021, the Q3 2021 silver equivalent production decreased by 86%. This decrease occurred due to an 86% decrease in mineralized material processed at the milling facility and in part from processing lower grade material. As noted above, subsequent to Q3 2021, the Company announced it had suspended operations at the Rosario Mine and placed the asset on care and maintenance. As a consequence of the minimal production during Q3 2021, reflective of the suspension of operations, no comparative analysis of Q3 2021 to Q3 2020 and Q2 2021 is provided.
About Santacruz Silver Mining Ltd.
Santacruz is a Mexican focused silver company with one producing silver project, the Zimapan Mine and two exploration properties, the La Pechuga property and Santa Gorgonia prospect. The Company is managed by a technical team of professionals with proven track records in developing, operating and discovering silver mines in Mexico. Our corporate objective is to become a mid-tier silver producer.
'signed'
Arturo Préstamo Elizondo,
Executive Chairman
For further information please contact:
Mars Investor Relations
Telephone: (778) 999 4653
scz@marsinvestorrelations.com
Arturo Prestamo
Santacruz Silver Mining Ltd.
Email: info@santacruzsilver.com
Telephone: (528) 183 785707
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
Certain statements contained in this news release constitute "forward-looking information" as such term is used in applicable Canadian securities laws, including statements relating to production at the Zimapan Mine and Rosario Project and the Company's plans to grow it. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions. In making the forward-looking statements included in this news release, the Company has applied several material assumptions, including that the Company's financial condition and development plans do not change as a result of unforeseen events and that future metal prices and the demand and market outlook for metals will remain stable or improve. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to above prove not to be valid or reliable; market conditions and volatility and global economic conditions, including increased volatility and potentially negative capital raising conditions resulting from the continued COVID-19 pandemic and risks relating to the extent and duration of such pandemic and its impact on global markets; risk of delay and/or cessation in planned work or changes in the Company's financial condition and development plans; risks associated with the interpretation of data (including in respect of third party mineralized material) regarding the geology, grade and continuity of mineral deposits; the uncertainty of the geology, grade and continuity of mineral deposits and the risk of unexpected variations in mineral resources, grade and/or recovery rates; risks related to gold, silver, base metal and other commodity price fluctuations; risks relating to environmental regulation and liability; the possibility that results will not be consistent with the Company's expectations, as well as the other risks and uncertainties applicable to mineral exploration and development activities and to the Company as set forth in the Company's continuous disclosure filings filed under the Company's profile at www.sedar.com. 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.
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First Majestic Prices Offering of Convertible Senior Notes
First Majestic Silver Corp. (NYSE: AG) (TSX: FR) ("First Majestic" or the "Company") announced today that it has priced its previously announced offering (the "Offering") of unsecured convertible senior notes due in 2027 (the "Notes"). The Company will issue US$200 million aggregate principal amount of Notes (or US$230 million aggregate principal amount if the over-allotment option is exercised in full). The Notes will be issued at par value. The Company intends to use approximately US$164.9 million of the net proceeds of the Offering to repurchase, in separate privately negotiated transactions, approximately US$125.2 million aggregate principal amount of its outstanding 1.875% convertible senior notes (the "Existing Notes"). The Company intends to use the remainder of the net proceeds from the Offering for general corporate purposes, including strategic opportunities.
The Notes will bear cash interest semi-annually at a rate of 0.375% per annum. The initial conversion rate for the Notes will be 60.3865 common shares ("Shares") per US$1,000 principal amount of Notes, equivalent to an initial conversion price of approximately US$16.56 per Share. The initial conversion rate represents a premium of approximately 35% relative to yesterday's closing market price of the Shares and is subject to adjustment in certain events.
In accordance with the terms of the Existing Notes, First Majestic intends to redeem, following a required 30 day notice period, any Existing Notes that are not converted or repurchased in conjunction with the Offering. The Company expects all such redemptions to be completed on or before December 31, 2021.
The Offering is expected to close on or about December 2, 2021, subject to customary closing conditions.
The Notes and the Shares into which the Notes are convertible, have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or qualified by a prospectus in Canada. The Notes and the Shares may not be offered or sold in the United States absent registration under the Securities Act or an applicable exemption from registration under the Securities Act and may not be offered or sold in Canada except pursuant to exemptions from the prospectus requirements of applicable Canadian provincial and territorial securities laws.
This news release is neither an offer to sell nor the solicitation of an offer to buy the Notes or the Shares into which the Notes are convertible, and shall not constitute an offer to sell or solicitation of an offer to buy, or a sale of, the Notes or the Shares into which the Notes are convertible in any jurisdiction in which such offer, solicitation or sale is unlawful.
ABOUT THE COMPANY
First Majestic is a publicly traded mining company focused on silver and gold production in Mexico and the United States. The Company presently owns and operates the San Dimas Silver/Gold Mine, the Jerritt Canyon Gold Mine, the Santa Elena Silver/Gold Mine and the La Encantada Silver Mine.
For further information contact info@firstmajestic.com or call Investor Relations at 1-866-529-2807.
FIRST MAJESTIC SILVER CORP.
"signed"
Keith Neumeyer, President & CEO
Forward Looking Statements
This press release contains "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995 or forward-looking information within the meaning of applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of First Majestic. Forward-looking statements include, but are not limited to, statements with respect to timing of closing of the Offering and the proposed use of proceeds of the Offering and the redemption or repurchase of the Existing Notes. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of First Majestic to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: failure to satisfy the conditions to closing of the Offering; risks related to the integration of acquisitions; risks related to international operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of metals; possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section entitled "Description of Business - Risk Factors" in First Majestic's Annual Information Form for the year ended December 31, 2020, available on www.sedar.com, and Form 40-F on file with the United States Securities and Exchange Commission in Washington, D.C. Although First Majestic has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. First Majestic does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.
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