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(Kitco News) - First Majestic Silver (TSX: FR) (NYSE: AG) announced on Thursday that in Q1 2023, the company produced 7.6 million silver equivalent ounces (consisting of 2.5 million silver ounces and 60,594 gold ounces), up 6% compared to Q1 2022.
In a statement, the company said that during the quarter, its Mexican operations saw “strong” production as a result of higher silver grades and overall plant performance.
First Majestic added that gold production in Mexico decreased 4% as slightly lower grades were processed at Santa Elena and San Dimas. At Jerritt Canyon in Nevada, USA, gold production reached 16,431 ounces, or a 3% decrease over the prior quarter primarily due to lower processed tonnes caused by continued extreme winter weather conditions.
The company said that revenues generated in Q1 2023 totaled $157.0 million compared to $156.8 million in Q1 2022; cash flow from operations before movements in working capital and income taxes in Q1 2023 was $21.9 million compared to $35.3 million in Q1 2022.
First Majestic also reported mine operating loss of $6.4 million in Q1 2023 compared to mine operating earnings of $15.1 million in Q1 2022.
The company explained that the decrease in mine operating earnings is primarily attributed to lower than expected production at Jerritt Canyon resulting in higher production costs per ounce, as well as higher labour, inflation, consumables and energy costs during the quarter. The company also incurred $5.1 million in standby costs for winding down activities at Jerritt Canyon.
The company reported Q1 2023 net loss of $100.7 million compared to net earnings of $7.3 million in Q1 2022. First Majestic said it recognized an impairment charge of $125.2 million, or $94.0 million net of tax, on the Jerritt Canyon gold mine following the company’s decision to temporarily suspend mining operations and focus on exploration activities to strengthen reserves and resources at the mine.
Adjusted net earnings for the quarter, normalized for non-cash or non-recurring items such as share-based payments, unrealized losses on marketable securities and non-recurring write-downs on mineral inventory for the quarter was $0.9 million compared to adjusted net loss of $6.2 million in Q1 2022.
Cash flow from operations before movements in working capital and income taxes in the quarter was $21.9 million compared to $35.3 million in the first quarter of 2022.
The company said that as of March 31, 2023, it had a cash and restricted cash balance of $235.9 million consisting of $104.8 million of cash and cash equivalents and $131.1 million of restricted cash.
First Majestic also announced that its Board of Directors has declared a cash dividend payment in the amount of $0.0057 per common share for the first quarter of 2023.
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 Santa Elena silver/gold mine, the La Encantada silver mine and the Jerritt Canyon gold mine.
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