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(Kitco News) - Endeavour Silver (NYSE: EXK) (TSX: EDR) today reported Q2 2023 production of 1,494,000 oz of silver (Q2 2022: 1,359,207 oz) and 9,819 oz of gold (Q2 2022: 9,289 oz) for 2.3 million oz silver equivalent, tracking in-line with guidance.
The company said its gross sales of $50.9 million in Q2 2023 represented a 61% increase over the $31.7 million in Q2 2022, adding that after cost of sales of $37.5 million (Q2 2022: $26.3 million), an increase of 43%, mine operating earnings were $12.5 million (Q2 2022: $4.5 million).
Endeavour Silver explained that the increase in the cost of sales compared to the prior period was driven by significantly higher silver ounces sold in the current period, a strengthened Mexican Peso and higher labour, power and consumables costs, “…as the company, as well as the industry, has experienced significant inflationary pressures.”
The company’s earnings before income taxes were $4.2 million (Q2 2022: loss before taxes of $8.8 million).
Importantly, Endeavour Silver said it realized a net loss for the period of $1.1 million (Q2 2022: $11.9 million) after an income tax expense of $5.2 million (Q2 2022: $3.1 million).
CEO Dan Dickson commented, “While we have been successful at managing the inflation trend over the last two years, costs are now outpacing our mitigation efforts. The Mexican Peso has strengthened to a seven year high against the US dollar, which is impacting costs across our operations.”
“Our bottom line has been impacted two-fold, through both inflation and foreign exchange. Cost control will continue to be a key focus for the operations group as cost pressures are expected to continue for the remainder of the year.”
Endeavour is a mid-tier precious metals mining company that operates two underground silver-gold mines in Mexico. Endeavour is also advancing construction of the Terronera project and exploring its portfolio of exploration projects in Mexico, Chile and the United States.
