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Precious metals producer Hochschild's profit falls in 2022 due to lower production and higher costs

Kitco Media
By Vladimir Basov
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(Kitco News) - South America-focused precious metals producer Hochschild announced on Thursday full year 2022 attributable production of 358,826 gold equivalent ounces (25.8 million silver equivalent ounces).

The company said that its overall attributable production was, as expected, lower than the 2021 figure of 390,496 gold equivalent ounces (28.1 million silver equivalent ounces) mainly due to scheduled grade reductions at Inmaculada and Pallancata.

Hochschild added that all-in sustaining costs (AISC) from operations were $1,364 per gold equivalent ounce in 2022 (2021: $1,153) or $18.9 per silver equivalent ounce (2021: $16.0), in line with full year cost guidance of $1,330-$1,370 per gold equivalent ounce or $18.5-19.0 per silver equivalent ounce.

The company also reported 2022 revenue of $735.6 million (2021: $811.4 million); adjusted EBITDA of $249.6 million (2021: $382.8 million); profit before income tax (pre-exceptional) of $24.3 million (2021: $148.7 million); and profit before income tax (post-exceptional) of $25.8 million (2021: $137.3 million).

According to a press release, adjusted EBITDA of $249.6 million (2021: $382.8 million) mostly reflects reduced production levels and increased cost of sales, while pre-exceptional earnings per share of $0.01 (2021: $0.14 per share) includes the impact of an increase in exploration expenses due to project expenditure at Snip in Canada and a reduction in income tax mainly due to the lower profitability.

In 2023, the company expects to produce 301,000-314,000 gold equivalent ounces (25.0-26.0 million silver equivalent ounces) at an all-in sustaining cost of $1,370-$1,450 per gold equivalent ounce ($16.5-$17.5 per silver equivalent ounce).

Hochschild Mining is a precious metals company listed on the London Stock Exchange (HOCM.L / HOC LN) and crosstrades on the OTCQX Best Market in the U.S. (HCHDF), with a primary focus on the exploration, mining, processing and sale of silver and gold.

The company currently operates three underground epithermal vein mines, two located in southern Peru and one in southern Argentina.

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Kitco Media

Vladimir Basov

Vladimir (PhD, MEng in Mining) is a professional mining engineer, scientist and analyst that has more than 20 years of practical in-field and research experience. He is particularly interested in collecting, processing baseline data and writing insightful data-driven mining industry analytics, articles, statistical and research reports.

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