First Majestic Silver Posts 1Q Loss As Lower Grades Dent Output
(Kitco News) - First Majestic Silver Corp. (NYSE: AG; TSX: FR) late Wednesday reported a net loss for the first quarter on lower output, with the company’s chief executive reporting that the number of ounces declined temporarily due to lower grades.
First Majestic listed a net loss of $5.6 million, or 3 cents per share, compared to net earnings of $2.7 million, or 2 cents, in the first quarter of 2017. Excluding non-cash and non-recurring items, the company generated an adjusted loss of $10.1 million, or 6 cents, during the quarter.
Revenues totaled $58.6 million, a decrease of 15% compared to $69.1 million in the first quarter of 2017 primarily due to an 11% decline in silver-equivalent ounces sold and a 5% decrease in the average realized silver price to $16.76 an ounce, First Majestic said.
Output came in at 3.9 million silver-equivalent ounces, including of 2.2 million ounces of silver, 15,887 ounces of gold, 4.4 million pounds of lead and 1.6 million pounds of zinc. Silver-equivalent output was 4.3 million ounces in the first quarter of 2017.
“In the first quarter, lower production rates resulted in a slight decrease in revenues and cash flows compared to the prior quarter,” said Keith Neumeyer, president and chief executive officer. “This temporary decrease in production, which was primarily due to lower head grades, naturally resulted in higher cash costs per ounce. Nevertheless, we managed to beat our overall cost guidance during the quarter due to strong gold production at the Santa Elena, San Martin and La Guitarra operations.
“Looking ahead, we plan to provide an updated production, costs and capital expenditure guidance in July to reflect the integration of the San Dimas operation.”