Fortuna Reports Results for the Third Quarter of 2022

 

  (All amounts expressed in US dollars, tabular amounts in millions, unless otherwise stated)  

 

Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) ("Fortuna" or the "Company") today reported its financial and operating results for the third quarter of 2022. Third Quarter 2022 Highlights

 

  Operational  

 
  • Gold and silver production of 66,344 ounces and 1,837,506 ounces, respectively. An increase of 1% and 7% respectively compared to the third quarter of 2021 ("Q3 2021"). Gold equivalent production of 101,840 3 ounces.
  •  
  • Cash costs 1 per ounce of gold of $772 for the Lindero Mine and $934 for the Yaramoko mine. Cash costs 1,2 per silver equivalent ounce of payable silver sold of $9.70 for the San Jose Mine and $11.32 for the Caylloma mine.
  •  
  • AISC 1 per ounce of gold sold of $1,159 for the Lindero Mine and $1,630 for the Yaramoko Mine. AISC 1,2 per silver equivalent ounce of payable silver sold of $14.23 and $15.66 for the San Jose Mine and Caylloma Mine, respectively.
  •  
  • The Company confirms it is tracking to meet production and the top end of cost guidance for the year.
  •  
  • Total recordable injury frequency rate of 2.36 per million hours worked and zero lost time injuries in over 3.3 million hours worked.
  •  

  Financial  

 
  • Free cash flow from ongoing operations 1 of $34.0 million, after operating mine capital, corporate overhead, taxes and interest paid, compared to $29.1 million reported in Q3 2021.
  •  
  • Adjusted EBITDA 1 of $54.4 million compared to $75.3 million reported in Q3 2021.
  •  
  • Net loss of $4.1 million or $0.01 per share, compared to $0.2 million or $0 net income per share reported in Q3 2021. Adjusted net income 1 of $2.3 million or $0.01 per share compared to $22.5 million reported in Q3 2021.
  •  
  • As at September 30, 2022, the Company had available liquidity of $125.9 million.
  •  
  • Returned $2.9 million of capital to shareholders during the quarter through the share repurchase program.
  •  

  Growth and Development  

 

  1 Refer to Non-IFRS financial measures
2 AISC/oz Ag Eq calculated at realized metal prices, refer to mine site results for realized prices and Non-IFRS Financial Measures for silver equivalent ratio
3 Gold equivalent production includes gold, silver, lead and zinc and is calculated using the following metal prices: US$1,718/oz Au, US$19.16/oz Ag, US$1,989/t Pb and US$3,268/t Zn or Au:Ag = 1:89.65, Au:Pb = 1:0.90, Au:Zn = 1:0.53

 

Jorge A. Ganoza, President and CEO, commented, "Our four mines had steady production of gold and silver in the quarter, which places us in a comfortable position at the end of the nine months of the year to meet our annual guidance estimates. Price inflation on key consumable products has driven cost at our operations to the upper range of annual cost guidance, but at this stage in the year we anticipate that the risk for significant cost deviations beyond guidance has diminished." Mr. Ganoza continued, "Free cash flow for the period remained strong, underpinned by robust production performance at our operating sites." Mr. Ganoza concluded, "Construction of our flagship Séguéla mine is 83% complete as of the end of October, remaining on-time and on-budget. We continue to successfully de-risk construction at a steady pace. All components of the SAG mill, a major equipment in the critical path of the project, have been shipped removing the last supply chain concerns on major equipment deliveries. Another milestone coming soon is the project connection to the national power grid, which is planned for December."

 
                                                                                                                                                                                                                                                                                                                         
             
   Three months ended September 30,   Nine months ended September 30,
    2022     2021   % Change    2022    2021   % Change
Sales    166.6     162.6   2 %    516.8    400.9   29 %
Mine operating income    24.7     47.3   (48 %)    120.8    147.1   (18 %)
Operating income    5.7     21.8   (74 %)    59.6    98.0   (39 %)
Net (loss) income    (4.1    )    0.2   (2,150 %)    24.5    42.8   (43 %)
(Loss) earnings per share - basic    (0.01    )    -   0 %    0.08    0.19   (58 %)
Adjusted net income 1    2.3     22.5   (90 %)    35.4    71.5   (50 %)
Adjusted EBITDA 1    54.4     75.3   (28 %)    189.7    191.1   (1 %)
Net cash provided by operating activities    64.7     39.4   64 %    144.6    90.1   60 %
Free cash flow from ongoing operations 1    34.0     29.1   17 %    64.8    70.4   (8 %)
Capital expenditures 2             
Sustaining    23.2     16.4   41 %    64.3    37.5   71 %
Non-sustaining 3    4.0     0.7   467 %    10.4    1.8   478 %
Lindero construction    -     1.4   (100 %)    -    4.0   (100 %)
Séguéla construction    23.5     -   100 %    87.6    -   100 %
Brownfields    9.6     4.3   123 %    17.1    10.3   66 %
As at          September 30, 2022    December 31, 2021   % Change
Cash and cash equivalents      90.9    107.1   (15 %)
Net liquidity position          125.9    187.1   (33 %)
  1 Refer to Non-IFRS Financial Measures section of this news release and to the MD&A accompanying the Company's financial statements filed on SEDAR at www.sedar.com for a description of the calculation of these measures.
  2 Capital expenditures are presented on a cash basis  
  3 Non-sustaining expenditures include greenfields exploration  
Figures may not add due to rounding  
 

  Third Quarter 2022 Results  

 

Net loss for the period was $4.1 million compared to net income of $0.2 million in Q3 2021. Operating income was $5.7 million compared to $21.8 million in the comparative period. Higher cash costs quarter over quarter were approximately $16.0 million due to continued inflationary pressures and higher processed tonnes at Yaramoko and San Jose. Management estimates that if realized gold and silver prices had stayed consistent with the previous year operating income would have been $13.0 million higher.

 

Additional items impacting net income in the quarter were a $3.4 million write off of the Tlamino project in Serbia, and $1.7 million of unrealized derivative losses.

 

Adjusted net income for the period was $2.3 million compared to $22.5 million in Q3 2021. Adjusted EBITDA was $54.4 million compared to $75.3 million in Q3 2021. The reduction in EBITDA was consistent with the drivers of lower operating income described above, namely lower silver and gold prices and inflationary cost pressures.

 

Net cash provided by operating activities was $64.7 million, compared to $39.4 million in Q3 2021, as the comparative quarter was impacted by $23.1 million of non-recurrent expenses ($12.6 million payment including taxes for the settlement of the disputed royalty claim with the Mexican Geological Survey and $10.5 million of transaction costs related to the Roxgold acquisition).

 

Free cash flow from ongoing operations in the quarter was $34.0 million after deducting operating mine capital, corporate overhead, taxes and interest paid. Year to date free cash flow from on-going operations was $64.8 million compared to $70.4 million in 2021.

 

Sales for the three months ended September 30, 2022 were $166.6 million, an increase of 2% from the $162.6 million over the same period in 2021. Sales by mine in the three months ended September 30, 2022 were as follows:

 
  • Lindero recognized adjusted sales of $51.9 million, a 25% increase from the $41.6 million reported in Q3 2021. Higher sales were the result of a 28% increase in volume of gold sold, partially offset by lower realized gold price of 3%.
  •  
  • Yaramoko recognized adjusted sales of $46.4 million, a 5% decrease from the $49.0 million reported in Q3 2021. Lower sales were the result of a 2% decrease in volume of gold sold and lower realized gold price of 4%.
  •  
  • San Jose recognized adjusted sales of $42.2 million, a 4% decrease from the $43.7 million reported in Q3 2021. Lower sales were driven by a 21% and 3% decrease in provisional silver and gold prices, respectively, partially offset by an increase of 7% and 2% in the volume of silver and gold ounces, respectively, sold.
  •  
  • Caylloma recognized adjusted sales of $26.1 million, a 7% decrease from the $28.0 million reported in Q3 2021. The decrease in sales was driven by 22% lower realized prices for silver as well as no gold sales compared to 1,466 ounces sold in the comparative period.
  •  

  Outlook on Cost and Inflation  

 

Inflationary pressures continued in the third quarter of 2022 as a result of geopolitical events, supply chain constraints and increases in the cost of energy and commodities. These inflationary pressures were realized in the Company's cost structure as prices increased for several key commodities including diesel, reagents, explosives and steel.

 

The inflation situation remains dynamic and the Company expects higher input costs to remain for the last quarter of the year and beyond. To mitigate inflationary pressure on its cost structure the Company will continue to focus on operational efficiencies and cost optimization across all mining operations. However, even with these efforts it is expected the continued inflationary pressures will push costs towards the upper end of our cost guidance.

 

  Liquidity  

 

Total liquidity available to the Company as at September 30, 2022 was $125.9 million, comprised of $90.9 million of cash and cash equivalents and $35.0 million undrawn on the Company's revolving $200 million credit facility.

 

The Company has secured credit approval from its banking syndicate to increase the existing senior secured revolving credit facility by $50.0 million to $250.0 million. The upsized facility will include a $50.0 million accordion feature, and is expected to close in the fourth quarter of 2022, subject to the completion of definitive documentation between the parties.

 

  Séguéla Construction  

 

As of September 30, 2022, the Séguéla Project had approximately $54.8 million in remaining spend of the project's $173.5 million construction budget, and the project remains on time and on budget. The Company's cash and cash equivalents balance, free cash flow from ongoing operations and undrawn amounts of the credit facility are expected to be sufficient to fund the construction of the Séguéla Project.

 

  Lindero Mine, Argentina  

 
                                                                                                                                                                                                                       
           
  Three months ended September 30,    Nine months ended September 30,
   2022     2021     2022     2021
Mine Production           
Tonnes placed on the leach pad   1,365,726     1,387,134     4,163,555     4,994,134
           
Gold           
Grade (g/t)   0.83     1.10     0.83     0.94
Production (oz)   30,032     26,235     89,116     68,088
Metal sold (oz)   30,064     23,559     89,229     63,788
Realized price ($/oz)   1,719     1,772     1,825     1,775
           
Unit Costs           
Cash cost ($/oz Au) 1   772     646     717     635
All-in sustaining cash cost ($/oz Au) 1   1,159     1,270     1,117     1,182
           
Capital expenditures ($000's) 2           
Sustaining   4,814     9,385     14,062     20,040
Non-sustaining         169    
Brownfields   314     47     1,104     489
  1 Cash cost and AISC are non-IFRS financial measures. Refer to Non-IFRS Financial Measures.
 

  Quarterly Operating and Financial Highlights  

 

In the third quarter of 2022, a total of 1,365,726 tonnes of ore were placed on the heap leach pad, averaging 0.83 g/t gold, containing an estimated 36,501 ounces of gold. Gold production for Q3 2022 totaled 30,032 ounces, representing a 14% increase year-over-year. Higher gold production is mainly explained by an increase in performance of the three-stage crushing and stacking circuits, which delivered 100% of the 1.37 million tonnes of ore placed on the pad in the quarter, compared to 89% or 1.2 million tonnes of the 1.39 million tonnes placed during the comparable quarter a year ago. Mine production was 2.2 million tonnes of mineralized material with a lower strip ratio of 0.83:1 when compared to the second quarter of 2022. The reduction in the stripping ratio was a result of optimizing the mine plan sequence during the period. The operation experienced a positive reconciliation for ore sent to the leach pad during the third quarter, with grades sampled at the plant being 5.6% higher than estimated from the reserve model.

 

Cash cost per ounce of gold for the three months ended September 30, 2022 was $772 compared to $646 in the third quarter of 2021. Cash cost per ounce of gold was higher due to higher consumable prices, mainly related to diesel, explosives and reagents, higher service costs related to maintenance equipment rentals and higher maintenance contractor expenses, partially offset by lower labor cost.

 

All-in sustaining cash cost per gold ounce sold was $1,159 during Q3 2022 compared with $1,270 in the third quarter of 2021. All-in sustaining cash cost for the third quarter of 2022 was impacted by the issues described above, offset by higher ounces sold, lower sustaining capital and a positive by-product effect.

 

Sustaining capital for the quarter primarily consisted of spending on the leach pad and mine maintenance. Construction of Phase-1B of the leach pad was completed during the quarter as planned, ensuring sufficient capacity to support the production plan through the second half of 2024. Detailed engineering work for the Phase-2 leach pad expansion was initiated in the third quarter of 2022 and is expected to be completed by year end. Construction work on Phase-2 is planned to commence in 2023. Brownfields capital primarily relates to exploration at the Arizaro project.

 

  Yaramoko Mine Complex, Burkina Faso  

 
                                                                                                                                                                                                                         
           
  Three months ended September 30,    Nine months ended September 30,
   2022     2021     2022     2021
Mine Production           
Tonnes milled   137,202     126,677     403,957     126,677
           
Gold           
Grade (g/t)   6.21     7.28     6.34     7.28
Recovery (%)   97     98     97     98
Production (oz)   27,130     28,751     79,918     28,751
Metal sold (oz)   27,055     27,494     81,183     27,494
Realized price ($/oz)   1,716     1,783     1,821     1,783
           
Unit Costs           
Cash cost ($/oz Au) 1   934     720     847     720
All-in sustaining cash cost ($/oz Au) 1   1,630     1,188     1,433     1,188
           
Capital expenditures ($000's) 3           
Sustaining   10,225     7,398     26,671     7,398
Brownfields   2,530     560     3,018     560
  1 Cash cost and AISC are non-IFRS financial measures. Refer to Non-IFRS Financial Measures.
  2 The Yaramoko Mine was acquired as part of the acquisition of Roxgold which completed on July 2, 2021. Comparative figures in 2021 are included from July 2, 2021 onward.
  3 Capital expenditures are presented on a cash basis
 

The Yaramoko Mine produced 27,130 ounces of gold in the third quarter of 2022 with an average gold head grade of 6.21g/t, which is in line with the mining sequence and Mineral Reserve estimate. The operation benefitted from higher mill throughput and operating time during the quarter offset by lower head grades when compared to the third quarter in 2021. Gold production for the first nine months of 2022 is in line with the annual guidance range.

 

Cash cost per gold ounce sold was $934, compared to $720 in the third quarter of 2021, primarily due to higher mining service costs related to inflation, higher processing costs due to annual mill inspection and repair moved up from November, and the processing of lower grade stockpiles during Q3 2022 as the site is currently mine constrained. This was partially offset by favorable foreign exchange rates.

 

All-in sustaining cash cost per gold ounce sold was $1,630 for Q3 2022, compared to $1,188 for the same period in 2021, as a result of decreased production, increased cash cost, and an increase in capital expenditures.

 

The operational focus remains on advancing development of the decline to maintain stope sequencing flexibility in the mine for the remainder of 2022 and into 2023. Sustaining capital for Q3 2022 was higher due to higher mine development and equipment purchases related to the QV Prime project in Bagassi South. Brownfields expenditure was higher due to greater amounts of diamond drilling as well as further development of the 109 Zone.

 

  San Jose Mine, Mexico  

 
                                                                                                                                                                                                                                                                                                                                       
           
  Three months ended September 30,    Nine months ended September 30,
   2022     2021     2022     2021
Mine Production           
Tonnes milled   267,198     248,984     770,090     778,352
Average tonnes milled per day   3,071     2,862     2,939     2,980
           
Silver           
Grade (g/t)   196     195     189     206
Recovery (%)   92     92     91     91
Production (oz)   1,545,410     1,436,658     4,288,936     4,707,496
Metal sold (oz)   1,539,382     1,440,946     4,272,878     4,704,656
Realized price ($/oz)   19.14     24.16     21.86     25.80
           
Gold           
Grade (g/t)   1.16     1.22     1.14     1.29
Recovery (%)   91     91     91     91
Production (oz)   9,091     8,910     25,625     29,477
Metal sold (oz)   9,064     8,922     25,580     29,421
Realized price ($/oz)   1,722     1,784     1,825     1,798
           
Unit Costs           
Production cash cost ($/t) 2   79.37     77.52     79.66     74.22
Production cash cost ($/oz Ag Eq) 1,2   9.70     9.99     10.35     9.28
All-in sustaining cash cost ($/oz Ag Eq) 1,2   14.23     15.51     14.95     14.13
           
Capital expenditures ($000's) 3           
Sustaining   4,410     3,553     12,036     9,525
Non-sustaining      745     869     1,776
Brownfields   1,548     2,547     4,645     6,437
  1 Production cash cost silver equivalent and All-in sustaining cash cost silver equivalent are calculated using realized metal prices for each period respectively
  2 Production cash cost, Production cash cost silver equivalent, and All-in sustaining cash cost silver equivalent are Non-IFRS Financial Measures, refer to Non-IFRS Financial Measures
  3 Capital expenditures are presented on a cash basis
 

In the third quarter of 2022, the San Jose Mine produced 1,545,410 ounces of silver and 9,091 ounces of gold, 8% and 2% higher, respectively, when compared to the equivalent period in 2021. The result is primarily due to higher mill throughput, with grades in line with the mining sequence and Mineral Reserve estimates. Silver production is tracking to meet the upper range of annual guidance.

 

The cash cost per tonne for the three months ended September 30, 2022 was $79.37 compared to $77.52 in the same period in 2021 primarily due to cost increases related to inflation, offset by higher tonnes processed.

 

All-in sustaining cash costs of $14.23 per ounce was lower than the $15.51 per ounce for the same period in 2021 with higher silver equivalent ounces offsetting higher costs.

 

Capital expenditures for the quarter was lower than the previous year primarily due to lower brownfields exploration cost as the site focused on less capital-intensive exploration.

 

  Caylloma Mine, Peru  

 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
           
  Three months ended September 30,    Nine months ended September 30,
   2022     2021     2022     2021
Mine Production           
Tonnes milled   139,143     136,410     407,695     401,942
Average tonnes milled per day   1,546     1,516     1,533     1,517
           
Silver           
Grade (g/t)   79     78     82     77
Recovery (%)   82     81     81     82
Production (oz)   292,096     275,223     871,594     810,962
Metal sold (oz)   293,159     295,532     866,511     830,495
Realized price ($/oz)   19.31     24.67     21.98     25.80
           
Gold           
Grade (g/t)   0.11     0.48     0.14     0.51
Recovery (%)   19     72     35     72
Production (oz)   91     1,529     656     4,712
Metal sold (oz)      1,466     603     3,140
Realized price ($/oz)      1,808     1,864     1,790
           
Lead           
Grade (%)   3.33     3.14     3.29     3.15
Recovery (%)   89     87     88     88
Production (000's lbs)   9,085     8,245     25,856     24,571
Metal sold (000's lbs)   9,155     8,859     25,751     25,354
Realized price ($/lb)   0.90     1.06     0.99     0.98
           
Zinc           
Grade (%)   4.37     4.74     4.22     4.67
Recovery (%)   89     87     89     87
Production (000's lbs)   11,885     12,436     33,598     36,169
Metal sold (000's lbs)   12,277     12,754     33,743     36,775
Realized price ($/lb)   1.48     1.36     1.65     1.31
           
Unit Costs           
Production cash cost ($/t) 2   93.12     86.04     92.03     85.17
Production cash cost ($/oz Ag Eq) 1,2   11.32     12.75     12.25     13.25
All-in sustaining cash cost ($/oz Ag Eq) 1,2   15.66     17.66     17.16     18.17
           
Capital expenditures ($000's) 3           
Sustaining   3,764     3,480     11,506     7,930
Brownfields   198     1,168     729     2,777
  1 Production cash cost silver equivalent and All-in sustaining cash cost silver equivalent are calculated using realized metal prices for each period respectively
  2 Production cash cost, Production cash cost silver equivalent, and All-in sustaining cash cost silver equivalent are Non-IFRS Financial Measures, refer to Non-IFRS Financial Measures
  3 Capital expenditures are presented on a cash basis
 

The Caylloma Mine produced 292,096 ounces of silver, 9.1 million pounds of lead, and 11.9 million pounds of zinc during the three months ended September 30, 2022. The operation delivered another strong quarter of operational performance and is tracking well to deliver total production in the upper range of guidance. Measured against the comparable quarter of the previous year, silver was 6% higher due to a combination of increased mill throughput, higher grades and better recoveries. Lead production was 10% higher than the comparable period as a result of higher head grades, recovery, and mill throughput. Zinc production was 4% lower than the comparable period, mainly impacted by lower head grades partially offset by higher mill throughput and recovery. Gold production totaled 91 ounces with an average head grade of 0.11 g/t.

 

The cash cost per tonne of processed ore for the three months ended September 30, 2022 increased 8% to $93.12 compared to $86.04 in the same period in 2021. The increase was mainly the result of higher mining costs driven by inflation and its direct impact on the price of materials, such as explosives, fuel, cement, reagents, mill balls and others.

 

The all-in sustaining cash cost for the three months ended September 30, 2022 decreased 11% to $15.66 per ounce compared to $17.66 per ounce for the same period in 2021 as a result of higher costs being offset by an increase in silver equivalent production.

 

Sustaining capital expenditures for the quarter increased primarily due to greater execution of the developments located in level 16 and level 18, offset by decreased expenditure on other levels. The decrease in brownfields capital expenditures was due to significantly lower spending on drilling and development. During the third quarter of 2022, an assessment study for a potential expansion of the mine and processing plant was commenced, with tradeoff results expected to be delivered in the first quarter of 2023.

 

  Qualified Person  

 

Eric Chapman, Senior Vice President of Technical Services, is a Professional Geoscientist of the Association of Professional Engineers and Geoscientists of the Province of British Columbia (Registration Number 36328), and is the Company's Qualified Person (as defined by National Instrument 43-101). Mr. Chapman has reviewed and approved the scientific and technical information contained in this news release and has verified the underlying data.

 

  Non-IFRS Financial Measures  

 

The Company has disclosed certain financial measures and ratios in this news release which are not defined under the International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board, and are not disclosed in the Company's financial statements, including but not limited to: cash cost per ounce of gold sold; all-in sustaining cash cost per ounce of gold sold; all-in cash cost per ounce of gold sold; total production cash cost per tonne; cash cost per payable ounce of silver equivalent sold; all-in sustaining cash cost per payable ounce of silver equivalent sold; all-in cash cost per payable ounce of silver equivalent sold; free cash flow from ongoing operations; adjusted net income; adjusted EBITDA and working capital.

 

These non-IFRS financial measures and non-IFRS ratios are widely reported in the mining industry as benchmarks for performance and are used by management to monitor and evaluate the Company's operating performance and ability to generate cash. The Company believes that, in addition to financial measures and ratios prepared in accordance with IFRS, certain investors use these non-IFRS financial measures and ratios to evaluate the Company's performance. However, the measures do not have a standardized meaning under IFRS and may not be comparable to similar financial measures disclosed by other companies. Accordingly, non-IFRS financial measures and non-IFRS ratios should not be considered in isolation or as a substitute for measures and ratios of the Company's performance prepared in accordance with IFRS. The Company has calculated these measures consistently for all periods presented.

 

To facilitate a better understanding of these measures and ratios as calculated by the Company, descriptions are provided below. In addition, see "Non-IFRS Financial Measures" in the Company's management's discussion and analysis for the three and nine months ended September 30, 2022 ("Q3 2022 MD&A"), which section is incorporated by reference in this news release, for additional information regarding each non-IFRS financial measure and non-IFRS ratio disclosed in this news release, including an explanation of their composition; an explanation of how such measures and ratios provide useful information to an investor and the additional purposes, if any, for which management of Fortuna uses such measures and ratio. The Q3 2022 MD&A may be accessed on SEDAR at www.sedar.com under the Company's profile, Fortuna Silver Mines Inc.

 

Except as otherwise described in the Q3 2022 MD&A, the Company has calculated these measures consistently for all periods presented.

 

  Adjusted Net Income for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                                                                                     
           
  Three months ended September 30,    Nine months ended September 30,
Consolidated   2022      2021     2022      2021
Net income   (4.1    )     0.2     24.5      42.8
  Adjustments, net of tax:            
Community support provision and accruals 1   -      -     -      0.1
Foreign exchange loss, Lindero Mine 2   -      1.2     -      3.8
Foreign exchange loss, Séguéla Project   0.3      -     1.2      -
Write off of mineral properties   3.4      -     4.9      -
Unrealized loss (gain) on derivatives   1.7      -     (0.5    )     -
Roxgold transaction costs   -      10.5     -      14.1
SGM Royalty settlement   -      6.7     -      6.7
Inventory adjustment   0.9      -     4.2      -
Accretion on right of use assets   0.6      -     1.8      -
Other non-cash/non-recurring items   (0.5    )     3.9     (0.7    )     4.0
Adjusted Net Income   2.3      22.5     35.4      71.5
  1 Amounts are recorded in Cost of sales           
  2 Amounts are recorded in General and Administration           
Figures may not add due to rounding           
 

  Adjusted EBITDA for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                                                                 
           
  Three months ended September 30,    Nine months ended September 30,
   2022      2021     2022      2021  
Net income   (4.1    )     0.2     24.5      42.8  
  Adjustments:            
Community support provision and accruals   -      -     -      (0.1 )
Inventory adjustment   1.1      1.8     5.1      1.7  
Foreign exchange loss, Lindero Mine   -      1.2     -      3.8  
Foreign exchange loss, Séguéla Project   0.3      -     1.2      -  
Net finance items   2.4      4.0     8.9      8.5  
Depreciation, depletion, and amortization   46.9      37.8     127.4      77.5  
Income taxes   5.8      8.9     26.1      34.2  
SGM Royalty settlement   -      9.6     -      9.6  
Roxgold transaction costs   -      10.5     -      14.1  
Other non-cash/non-recurring items   2.0      1.3     (3.5    )     (1.0 )
Adjusted EBITDA   54.4      75.3     189.7      191.1  
 

Figures may not add due to rounding

 

  Free Cash Flow from ongoing operations for the Three and Nine Months Ended September 30, 2022 and 2021  

 

In 2022, the Company changed the method for calculating Free Cash Flow from Ongoing Operations. The calculation now uses taxes paid as opposed to the previous method which used current income taxes. While this may create larger quarter over quarter fluctuations due to the timing of income tax payments, management believes the revised method is a better representation of the Free Cash Flow generated by the Company's ongoing operations. Comparative values from 2021 have been restated using the change in the methodology.

 
                                                                                                                                              
           
  Three months ended September 30,    Nine months ended September 30,
   2022     2021     2022     2021  
     (Restated)        (Restated)  
Net cash provided by operating activities   64.7      39.4      144.6      90.1  
  Adjustments            
Roxgold transaction costs   -      3.5      -      3.5  
Additions to mineral properties, plant and equipment   (27.8    )     (13.8 )     (73.8    )     (23.2 )
Progresso royalty payment   -      -      3.0      -  
Other adjustments   (2.9    )     -      (9.0    )     -  
Free cash flow from ongoing operations   34.0      29.1      64.8      70.4  
 

Figures may not add due to rounding

 

  Cash Cost per Ounce of Gold Sold for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                                                                                                  
             
  Lindero Mine     Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)      2022      2021      2022      2021  
Cost of sales     43,928      29,508      121,122      75,974  
Changes in doré inventory     (107    )     1,456      605      2,458  
Inventory adjustment     -      (1,743 )     -      (1,743 )
Export duties     (3,900    )     (3,137 )     (12,192    )     (8,519 )
Depletion and depreciation     (14,898    )     (9,092 )     (41,203    )     (24,512 )
By product credits     (232    )     (55 )     (232    )     (183 )
Production cash cost 1     24,791      16,937      68,100      43,475  
Changes in doré inventory     107      (1,456 )     (605    )     (2,458 )
Realized gain in diesel hedge     (1,696    )     (272 )     (3,515    )     (525 )
Cash cost applicable per gold ounce sold A    23,202      15,209      63,980      40,492  
Ounces of gold sold B    30,052      23,549      89,193      63,672  
Cash cost per ounce of gold sold 1 ($/oz) =A/B    772      646      717      635  
  1 September 30, 2021 restated, Sustaining leases moved to All-In Sustaining
 

 

 
                                                                                                                                                                                                                                                                   
             
  Yaramoko Mine     Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)      2022      2021      2022      2021  
Cost of sales     47,481      38,431      129,762      38,431  
Changes in doré inventory     -      823      (1,320    )     823  
Inventory net realizable value adjustment     (1,050    )     -      (5,077    )     -  
Export duties     (2,817    )     (2,975 )     (8,898    )     (2,975 )
Depletion and depreciation     (18,356    )     (15,739 )     (47,010    )     (15,739 )
Refining charges     -      -      (329    )     -  
By product credits     -      (61 )     (25    )     (61 )
Production cash cost     25,258      20,479      67,103      20,479  
Changes in doré inventory     -      (823 )     1,320      (823 )
Refining charges     -      138      329      138  
Cash cost applicable per gold ounce sold A    25,258      19,794      68,752      19,794  
Ounces of gold sold B    27,055      27,475      81,183      27,475  
Cash cost per ounce of gold sold ($/oz) =A/B    934      720      847      720  
The Yaramoko Mine was acquired as part of the acquisition of Roxgold which completed on July 2, 2021. Comparative figures in 2021 are included from July 2, 2021 onward.
 

  All-in Sustaining Cash Cost per Ounce of Gold Sold for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                           
           
  Lindero Mine   Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)    2022     2021     2022     2021
Cash cost applicable   23,202     15,209     63,980     40,492
Export duties and mining taxes   3,900     3,137     12,192     8,519
General and administrative expenses (operations)   2,044     1,387     6,497     4,003
Adjusted operating cash cost   29,146     19,733     82,669     53,014
Sustaining leases   563     740     1,831     1,796
Sustaining capital expenditures 1   4,814     9,385     14,062     20,040
Brownfields exploration expenditures 1   314     47     1,104     489
All-in sustaining cash cost   34,837     29,905     99,666     75,339
Non-sustaining capital expenditures 1   -     -     169     -
All-in cash cost   34,837     29,905     99,835     75,339
Ounces of gold sold   30,052     23,549     89,193     63,762
All-in sustaining cash cost per ounce of gold sold   1,159     1,270     1,117     1,182
All-in cash cost per ounce of gold sold   1,159     1,270     1,119     1,182
  1 Presented on a cash basis
 

 

 
                                                                                                                                                                            
           
  Yaramoko Mine   Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)    2022     2021     2022     2021
Cash cost applicable   25,258     19,794     68,752     19,794
Inventory net realizable value adjustment   1,170     2,975     3,125     2,975
Export duties and mining taxes   2,817     -     8,898     -
General and administrative expenses (operations)   688     439     1,570     439
Adjusted operating cash cost   29,933     23,208     82,345     23,208
Sustaining leases   1,419     1,467     4,273     1,467
Sustaining capital expenditures 1   10,225     7,398     26,671     7,398
Brownfields exploration expenditures 1   2,530     560     3,018     560
All-in sustaining cash cost   44,107     32,633     116,307     32,633
All-in cash cost   44,107     32,633     116,307     32,633
Ounces of gold sold   27,055     27,475     81,183     27,475
All-in sustaining cash cost per ounce of gold sold   1,630     1,188     1,433     1,188
All-in cash cost per ounce of gold sold   1,630     1,188     1,433     1,188
The Yaramoko Mine was acquired as part of the acquisition of Roxgold which completed on July 2, 2021. Comparative figures in 2021 are included from July 2, 2021 onward.
  1 Presented on a cash basis
 

  Production Cash Cost per Tonne and Cash Cost per Payable Ounce of Silver Equivalent Sold for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
             
  San Jose Mine     Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)      2022      2021      2022      2021  
Cost of sales     32,936      29,980      94,313      90,051  
Changes in concentrate inventory     (209    )     (31 )     (137    )     63  
Depletion and depreciation in concentrate inventory     68      54      49      21  
Inventory adjustment     312      (35 )     266      46  
Royalties and mining taxes     (1,261    )     (1,641 )     (4,002    )     (4,368 )
Workers participation     (979    )     (1,218 )     (1,876    )     (4,573 )
Depletion and depreciation     (9,659    )     (7,808 )     (27,265    )     (23,468 )
Cash cost 3 A    21,208      19,301      61,348      57,772  
Total processed ore (tonnes) B    267,198      248,984      770,090      778,352  
Production cash cost per tonne 3 ($/t) =A/B    79.37      77.52      79.66      74.22  
Cash cost 3 A    21,208      19,301      61,348      57,772  
Changes in concentrate inventory     209      31      137      (63 )
Depletion and depreciation in concentrate inventory     (68    )     (54 )     (49    )     (21 )
Inventory adjustment     (312    )     35      (266    )     (46 )
Treatment charges     (173    )     (2,622 )     (228    )     (441 )
Refining charges     997      3,539      2,789      3,161  
Cash cost applicable per payable ounce sold 3 C    21,861      20,230      63,731      60,362  
Payable ounces of silver equivalent sold 1 D    2,254,673      2,024,487      6,159,782      6,501,691  
Cash cost per ounce of payable silver equivalent sold 2,3 ($/oz) =C/D    9.70       9.99       10.35       9.28   
Mining cost per tonne 3     37.72       38.00       37.48       38.74   
Milling cost per tonne     17.49      17.22      18.74      16.71  
Indirect cost per tonne     16.09      14.79      15.48      12.66  
Community relations cost per tonne     2.68      3.08      2.55      1.44  
Distribution cost per tonne     5.39      4.43      5.41      4.67  
Production cash cost per tonne 3 ($/t)     79.37      77.52      79.66      74.22  
  1 Silver equivalent sold for Q3 2022 is calculated using a silver to gold ratio of 90.0:1 (Q3 2021: 73.8:1). Silver equivalent sold for YTD 2022 is calculated using a silver to gold ratio of 83.5:1 (YTD 2021: 69.7:1).
  2 Silver equivalent is calculated using the realized prices for gold and silver. Refer to Financial Results – Sales and Realized Prices
  3 September 30, 2021 restated, Sustaining leases moved to All-In Sustaining
 

 

 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
             
  Caylloma Mine     Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)      2022      2021      2022      2021  
Cost of sales     17,512      17,302      50,815      49,332  
Changes in concentrate inventory     135      (670 )     11      (899 )
Depletion and depreciation in concentrate inventory     (30    )     133      (196    )     155  
Inventory adjustment     (491    )     -      (179    )     -  
Royalties and mining taxes     (218    )     (68 )     (686    )     (157 )
Provision for community support     123      -      97      -  
Workers participation     (455    )     (412 )     (1,389    )     (1,624 )
Depletion and depreciation     (3,619    )     (4,549 )     (10,952    )     (12,575 )
Cash cost 3 A    12,957      11,736      37,521      34,232  
Total processed ore (tonnes) B    139,143      136,410      407,695      401,942  
Production cash cost per tonne 3 ($/t) =A/B    93.12      86.04      92.03      85.17  
Cash cost A    12,957      11,736      37,521      34,232  
Changes in concentrate inventory     (135    )     670      (11    )     899  
Depletion and depreciation in concentrate inventory     30      (133 )     196      (155 )
Inventory adjustment     491      -      179      -  
Treatment charges     3,028      4,378      11,195      11,125  
Refining charges     389      459      1,153      1,292  
Cash cost applicable per payable ounce sold 3 C    16,760      17,110      50,233      47,393  
Payable ounces of silver equivalent sold 1 D    1,480,688      1,341,997      4,101,900      3,577,778  
Cash cost per ounce of payable silver equivalent sold 2,3 ($/oz) =C/D    11.32      12.75      12.25      13.25  
Mining cost per tonne     41.38      33.82      39.04      32.24  
Milling cost per tonne     14.57      15.95      15.24      15.00  
Indirect cost per tonne     28.46      28.05      29.50      29.50  
Community relations cost per tonne     1.30      0.51      0.93      0.72  
Distribution cost per tonne     7.43      7.71      7.34      7.71  
Production cash cost per tonne 3 ($/t)     93.14      86.04      92.05      85.17  
  1 Silver equivalent sold for Q3 2022 is calculated using a silver to gold ratio of 0.0:1 (Q3 2021: 72.5:1), silver to lead ratio of 1:21.4 pounds (Q3 2021: 1:23.3), and silver to zinc ratio of 1:13.0 pounds (Q3 2021: 1:18.1). Silver equivalent sold for YTD 2022 is calculated using a silver to gold ratio of 84.8:1 (YTD 2021: 69.4:1), silver to lead ratio of 1:22.2 pounds (YTD 2021: 1:26.3), and silver to zinc ratio of 1:13.3 pounds (YTD 2021: 1:19.7).
  2 Silver equivalent is calculated using the realized prices for gold, silver, lead, and zinc. Refer to Financial Results - Sales and Realized Prices
  3 September 30, 2021 restated, Sustaining leases moved to All-In Sustaining
 

  All-in Sustaining Cash Cost and All-in Cash Cost per Payable Ounce of Silver Equivalent Sold for the Three and Nine Months Ended September 30, 2022 and 2021  

 
                                                                                                                                                                                         
           
  San Jose Mine   Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)    2022     2021     2022     2021
Cash cost applicable 4   21,861     20,230     63,731     60,362
Royalties and mining taxes   1,261     1,641     4,002     4,368
Workers' participation   1,224     1,522     2,345     5,716
General and administrative expenses (operations)   1,606     1,719     4,845     5,022
Adjusted operating cash cost 4   25,952     25,112     74,923     75,468
Sustaining leases 4   183     184     489     447
Sustaining capital expenditures 3   4,410     3,553     12,036     9,525
Brownfields exploration expenditures 3   1,548     2,547     4,645     6,437
All-in sustaining cash cost   32,093     31,397     92,093     91,878
Non-sustaining capital expenditures 3   -     745     869     1,776
All-in cash cost   32,093     32,142     92,962     93,654
Payable ounces of silver equivalent sold 1   2,254,673     2,024,487     6,159,782     6,501,691
All-in sustaining cash cost per ounce of payable silver equivalent sold 2   14.23     15.51     14.95     14.13
All-in cash cost per ounce of payable silver equivalent sold 2   14.23     15.88     15.09     14.40
  1 Silver equivalent sold for Q3 2022 is calculated using a silver to gold ratio of 90.0:1 (Q3 2021: 73.9:1). Silver equivalent sold for YTD 2022 is calculated using a silver to gold ratio of 83.5:1 (YTD 2021: 69.7:1).
  2 Silver equivalent is calculated using the realized prices for gold and silver. Refer to Financial Results - Sales and Realized Prices
  3 Presented on a cash basis
  4 September 30, 2021 restated, Sustaining leases moved from Cash Cost
 

 

 
                                                                                                                                                                              
           
  Caylloma Mine   Three months ended September 30,    Nine months ended September 30,
  (Expressed in $'000's, except unit costs)    2022     2021     2022     2021
Cash cost applicable 4   16,760     17,110     50,233     47,392
Royalties and mining taxes   218     68     686     157
Workers' participation   522     465     1,607     1,886
General and administrative expenses (operations)   890     630     3,135     2,700
Adjusted operating cash cost 4   18,390     18,273     55,661     52,135
Sustaining leases 4   841     780     2,505     2,170
Sustaining capital expenditures 3   3,764     3,480     11,506     7,930
Brownfields exploration expenditures 3   198     1,168     729     2,777
All-in sustaining cash cost   23,193     23,701     70,401     65,012
All-in cash cost   23,193     23,701     70,401     65,012
Payable ounces of silver equivalent sold 1   1,480,688     1,341,997     4,101,900     3,577,778
All-in sustaining cash cost per ounce of payable silver equivalent sold 2   15.66     17.66     17.16     18.17
All-in cash cost per ounce of payable silver equivalent sold 2   15.66     17.66     17.16     18.17
  1 Silver equivalent sold for Q3 2022 is calculated using a silver to gold ratio of 0.0:1 (Q3 2021: 72.5:1), silver to lead ratio of 1:21.4 pounds (Q3 2021: 1:23.3), and silver to zinc ratio of 1:13.0 pounds (Q3 2021: 1:18.2). Silver equivalent sold for YTD 2022 is calculated using a silver to gold ratio of 84.8:1 (YTD 2021: 69.4:1), silver to lead ratio of 1:22.2 pounds (YTD 2021: 1:26.3), and silver to zinc ratio of 1:13.3 pounds (YTD 2021: 1:19.7).
  2 Silver equivalent is calculated using the realized prices for gold, silver, lead, and zinc. Refer to Financial Results - Sales and Realized Prices
  3 Presented on a cash basis
  4 September 30, 2021 restated, Sustaining leases moved from Cash Cost
 

Additional information regarding the Company's financial results and activities underway are available in the Company's third quarter 2022 Financial Statements and accompanying Q3 2022 MD&A, which are available for download on the Company's website, www.fortunasilver.com , on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar .

 

  Conference Call and Webcast  

 

A conference call to discuss the financial and operational results will be held on Thursday, November 10, 2022 at 9:00 a.m. Pacific time | 12:00 p.m. Eastern time. Hosting the call will be Jorge A. Ganoza, President and CEO; Luis D. Ganoza, Chief Financial Officer; Cesar Velasco, Chief Operating Officer - Latin America and David Whittle, Chief Operating Officer - West Africa.

 

Shareholders, analysts, media and interested investors are invited to listen to the live conference call by logging onto the webcast at https://www.webcaster4.com/Webcast/Page/1696/46956 or over the phone by dialing in just prior to the starting time.

 

  Conference call details:  

 

Date: Thursday, November 10, 2022
Time: 9:00 a.m. Pacific time | 12:00 p.m. Eastern time

 

Dial in number (Toll Free): +1. 888.506.0062
Dial in number (International): +1.973.528.0011
Entry code: 722669

 

Replay number (Toll Free): +1.877.481.4010
Replay number (International): +1.919.882.2331
Replay Passcode: 46956

 

Playback of the earnings call will be available until Thursday, November 24, 2022. Playback of the webcast will be available until Friday, November 10, 2023. In addition, a transcript of the call will be archived on the Company's website.

 

  About Fortuna Silver Mines Inc.  

 

Fortuna Silver Mines Inc. is a Canadian precious metals mining company with four operating mines in Argentina, Burkina Faso, Mexico and Peru, and a fifth mine under construction in Côte d'Ivoire. Sustainability is integral to all our operations and relationships. We produce gold and silver and generate shared value over the long-term for our stakeholders through efficient production, environmental protection and social responsibility. For more information, please visit our   website    .  

 

ON BEHALF OF THE BOARD

 

  Jorge A. Ganoza  
President, CEO, and Director
Fortuna Silver Mines Inc.

 

Investor Relations:
Carlos Baca | info@fortunasilver.com  

 

   Forward-looking Statements   

 

  This news release contains forward-looking statements which constitute "forward-looking information" within the meaning of applicable Canadian securities legislation and "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 (collectively, "Forward-looking Statements"). All statements included herein, other than statements of historical fact, are Forward-looking Statements and are subject to a variety of known and unknown risks and uncertainties which could cause actual events or results to differ materially from those reflected in the Forward-looking Statements. The Forward-looking Statements in this news release include, without limitation, statements about the Company's plans for its mines and mineral properties; the Company's anticipated financial and operational performance in 2022; estimated production and costs of production for 2022, including grade and volume of metal produced and sales, revenues and cashflows, and capital costs (sustaining and non-sustaining), and operating costs, including projected production cash costs and all-in sustaining costs; the ability of the Company to mitigate the inflationary pressures on supplies used in its operations; estimated capital expenditures and estimated exploration spending in 2022, including amounts for exploration activities at its properties; the Company's plans for the construction of the open pit mine at the Séguéla project in Cote d'Ivoire; the economics for the construction of the mine at the Séguéla project as set out in the feasibility study, the estimated construction capital expenditures for the project, the timelines and schedules for the construction and production of gold at the Séguéla project; statements regarding the Company's liquidity, access to capital, including the proposed increase in size of the Company's existing credit facility; the impact of COVID-19 on the Company's operations; the Company's business strategy, plans and outlook; the merit of the Company's mines and mineral properties; mineral resource and reserve estimates, metal recovery rates, concentrate grade and quality; changes in tax rates and tax laws, requirements for permits, anticipated approvals and other matters. Often, but not always, these Forward-looking Statements can be identified by the use of words such as "estimated", "expected", "anticipated", "potential", "open", "future", "assumed", "projected", "used", "detailed", "has been", "gain", "planned", "reflecting", "will", "containing", "remaining", "to be", or statements that events, "could" or "should" occur or be achieved and similar expressions, including negative variations.  

 

  Forward-looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any results, performance or achievements expressed or implied by the Forward-looking Statements. Such uncertainties and factors include, among others, changes in general economic conditions and financial markets; the impact of the COVID-19 pandemic on the Company's mining operations and construction activities; the risks relating to a global pandemic, including the COVID-19 pandemic, as well as risks associated with war or other geo-political hostilities, such as the Ukrainian – Russian conflict, any of which could continue to cause a disruption in global economic activity; the risks associated with the acquisition of Roxgold; fluctuation in currencies and foreign exchange rates; increases in the rate of inflation; the imposition of capital controls in countries in which the Company operates; any extension of the currency controls in Argentina or changes in tax laws in Argentina and the other countries in which we operate; the ability of the Company to enter into definitive documentation to increase the size of its existing credit facility, on acceptable terms or at all; changes in the prices of key supplies; technological and operational hazards in Fortuna's mining and mine development activities; risks inherent in mineral exploration; uncertainties inherent in the estimation of mineral reserves, mineral resources, and metal recoveries; changes to current estimates of mineral reserves and resources; changes to production and cost estimates; changes in the position of regulatory authorities with respect to the granting of approvals or permits; governmental and other approvals; changes in government, political unrest or instability in countries where Fortuna is active; labor relations issues; as well as those factors discussed under "Risk Factors" in the Company's Annual Information Form. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in Forward-looking Statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended.  

 

  Forward-looking Statements contained herein are based on the assumptions, beliefs, expectations and opinions of management, including but not limited to the accuracy of the Company's current mineral resource and reserve estimates; that the Company's activities will be conducted in accordance with the Company's public statements and stated goals; that there will be no material adverse change affecting the Company, its properties or changes to production estimates (which assume accuracy of projected ore grade, mining rates, recovery timing, and recovery rate estimates and may be impacted by unscheduled maintenance, labour and contractor availability and other operating or technical difficulties); the construction at the Séguéla gold Project will continue on the time line and in accordance with the budget as planned; the duration and impacts of COVID-19; geo-political uncertainties that may affect the Company's production, workforce, business, operations and financial condition; that the Company will the expected trends in mineral prices and currency exchange rates; that the Company will be successful in mitigating the impact of inflation on its business and operations; that the Company will be able to enter into definitive documentation to increase the size of its existing credit facility, on terms acceptable to it; that all required approvals and permits will be obtained for the Company's business and operations on acceptable terms; that there will be no significant disruptions affecting the Company's operations, the ability to meet current and future obligations and such other assumptions as set out herein. Forward-looking Statements are made as of the date hereof and the Company disclaims any obligation to update any Forward-looking Statements, whether as a result of new information, future events or results or otherwise, except as required by law. There can be no assurance that these Forward-looking Statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, investors should not place undue reliance on Forward-looking Statements.  

 

   Cautionary Note to United States Investors Concerning Estimates of Reserves and Resources   

 

  Reserve and resource estimates included in this news release have been prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian Institute of Mining, Metallurgy, and Petroleum Definition Standards on Mineral Resources and Mineral Reserves. NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes standards for public disclosure by a Canadian company of scientific and technical information concerning mineral projects. Unless otherwise indicated, all mineral reserve and mineral resource estimates contained in the technical disclosure have been prepared in accordance with NI 43-101 and the Canadian Institute of Mining, Metallurgy and Petroleum Definition Standards on Mineral Resources and Reserves. Canadian standards, including NI 43-101, differ significantly from the requirements of the Securities and Exchange Commission, and mineral reserve and resource information included in this news release may not be comparable to similar information disclosed by U.S. companies.  

 

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Fortuna Announces Pricing of Convertible Senior Notes

Fortuna Announces Pricing of Convertible Senior Notes

 

Fortuna Silver Mines Inc. (TSX: FVI) (NYSE: FSM) ("Fortuna" or the "Company") announces that it has priced its previously announced offering of convertible senior notes due 2029 (the "Notes") in an aggregate principal amount of US$150 million (the "Offering"). The Company has granted the initial purchasers of the Notes an option for a period of 15 days to purchase up to an additional US$22.5 million aggregate principal amount of Notes. The Notes will be issued at par value.

 

The Notes will bear cash interest semi-annually at a rate of 3.75% per annum. The initial conversion rate for the Notes will be 151.7220 common shares of Fortuna ("Shares") per US$1,000 principal amount of Notes, equivalent to an initial conversion price of approximately US$6.59 per Share. The initial conversion rate represents a premium of approximately 30% relative to today's closing sale price of the Shares and is subject to adjustment in certain events.

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Fortuna's Yaramoko Mine reaches one-million-ounce gold pour milestone

Fortuna's Yaramoko Mine reaches one-million-ounce gold pour milestone

 

Fortuna Silver Mines Inc. (TSX: FVI) (NYSE: FSM) is pleased to report that the Yaramoko Mine located in Burkina Faso reached the one-million-ounce gold pour milestone on May 19, 2024. Yaramoko started production on May 16, 2016 and Fortuna acquired the mine on July 2, 2021 (refer to Fortuna news release dated July 2, 2021 ).

 

As of December 31, 2023, Yaramoko has a remaining mine life of two years with Proven and Probable Mineral Reserves of 0.9 Mt at a grade of 7.90 g/t Au and containing 219 koz Au, in addition to Measured and Indicated Mineral Resources, exclusive of Mineral Reserves, of 0.5 Mt at a grade of 2.87 g/t Au and containing 43 koz Au, and Inferred Mineral Resources, exclusive of Mineral Reserves, of 0.16 Mt at a grade of 3.52 g/t Au and containing 18 koz Au (refer to Fortuna news release dated February 15, 2024, " Fortuna reports updated Mineral Reserves and Mineral Resources "). The mine's exploration budget for 2024 is US$6.1 million, which includes 41,450 meters of drilling (refer to Fortuna news release dated January 18, 2024 ).

News Provided by GlobeNewswire via QuoteMedia

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