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(Kitco News) - Gatos Silver (NYSE: GATO) (TSX: GATO) yesterday reported that its 70%-owned Cerro Los Gatos (CLG) mine in Mexico produced 2.0 million ounces of silver in Q2 2023, down 13% from Q2 2022 (2.3 million ounces).
The company said the reduction in silver output is mainly attributable to a 29% decline in silver grades in Q2 2023, as expected in the mine plan, and partially offset by the 26% increase in mill throughput.
For the Los Gatos joint venture, the company reported Q2 2023 revenue of $58.3 million, up 2% from $57.2 million in Q2 2022; cost of sales of $25.8 million, down 7% from $27.8 million; EBITDA of $27.5 million, up 29% from $21.4 million; free cash flow of $19.7 million, up 1% from $19.5 million; and net income of $0.7 million, down 78% from $3.4 million.
In Q2 2023, Gatos Silver’s net loss was $3.6 million or $(0.05) per share compared with net income of $5.2 million or $0.08 per share in Q2 2022.
The company explained that the decline is primarily attributable to lower equity income from the Los Gatos joint venture driven by higher depreciation, depletion and amortization and income tax expenses.
CEO Dale Andres commented, “The LGJV continues to generate robust cash flows and perform in line with our expectations, and we remain on track to achieve 2023 guidance at CLG. We are in a strong financial position with the company now debt free and with a strong cash balance.
“We are progressing well with our planned update to CLG’s mineral resource and reserve estimate which we expect to announce later this quarter, including a new life of mine plan.”
Gatos Silver is a 70% owner of the Los Gatos Joint Venture in Mexico. The company is primarily focused on operating the Cerro Los Gatos mine and on growth and development of the Los Gatos district.
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