Performance

Production Report - 1Q22

Octavio Alvídrez, Chief Executive Officer, said: “We are reporting a solid first quarter’s production, in line with expectations. We have taken proactive steps to manage the impact of the Mexico labour reforms, and though we continue to see some covid-related absenteeism at our mine sites, this declined during the quarter and we are currently seeing a limited covid impact. Like other industry sectors, the labour market remains very tight, and we have also seen some delays to equipment deliveries given the global supply constraints. That said, we remain committed to delivering on our targets for the year, completing the labour reform process, ramping up new Juanicipio production rapidly once connection to the electricity grid is enabled by mid-2022, capitalising on the considerable opportunities presented by our highly prospective exploration programme, while never losing focus on our people, their well-being and their safety. Our full year guidance is unchanged".  Read full release »


Silver

  • Quarterly attributable silver production of 13.3 moz (including Silverstream), up 2.8% vs. 4Q21 mainly driven by a higher contribution of ore from Juanicipio and a higher volume of ore processed and ore grade at Fresnillo, partly offset by the anticipated lower volume of ore processed at Saucito.
  • Quarterly attributable silver production increased 5.1% vs. 1Q21 primarily due to a higher contribution of ore from Juanicipio, offset by the anticipated lower volume of ore processed at Saucito.

Gold

  • Quarterly attributable gold production of 149.8 koz, flat vs. 4Q21 mainly due to a lower volume of ore processed at Noche Buena and to a lesser extent, a lower volume of ore processed at Saucito and San Julian Veins, mitigated by a higher ore grade and recovery rate at Herradura.
  • Quarterly attributable gold production decreased 34.4% vs. 1Q21 primarily due to an expected lower volume of ore processed and ore grade at Herradura.

By-Products

  • Quarterly attributable by-product lead production increased 3.4% vs. 4Q21 due to a higher contribution of development ore from Juanicipio, partially offset by a lower ore grade at San Julián DOB.
  • Quarterly attributable by-product zinc production increased 3.6% vs. 4Q21 due to a higher contribution of development ore from Juanicipio and a higher ore grade and recovery rate at Saucito, offset by a lower ore grade at Fresnillo.
  • Quarterly attributable by-product lead and zinc production decreased 20.2% and 8.3% vs. 1Q21 respectively, driven primarily by lower ore grades and decreased volumes of ore processed at Saucito.

Development Projects

  • Construction of the Juanicipio plant was delivered on schedule during 4Q21. We remain focused on complying with the requirements from the state-owned electricity company and the energy regulator to complete the tie-in to the national power grid, expected in mid-2022.
  • Once required permits have been granted, we expect to ramp up operations to 85%-90% capacity by the end of the year.

Safety Performance

The safety and wellbeing of our people is our priority. Despite the sustained improvement in total and lost time injury frequency rates, we deeply regret to report a fatal incident in early 2022, as disclosed in our Preliminary announcement. The tragic loss of our colleague is unacceptable. We are firmly committed to eliminating all injuries, and especially fatalities. To this end, we have reviewed the progress of the High Potential Incident and Critical Risk Control programme. The Company is sharing the lessons learnt following every accident or high potential incident with our employees and contractors across all our operations. Management and the workforce are collaborating to identify, design, implement and verify on-site the critical controls to prevent fatal and serious injuries. We reviewed the approach and effectiveness of the “I Care, We Care” programme in fostering leadership, accountability, safety culture, risk-based management and engineering systems and lessons learnt.

2022 outlook

2022 guidance remains unchanged. Attributable silver production is expected to be in the range of 50.5 to 56.5 moz (including Silverstream) while attributable gold production is expected to be in the range of 600 to 650 koz.

Total Production

 

1Q22

4Q21

% change

1Q21

% change

FY21

FY20

% change

Silver (koz)

12,528

12,230

2.4

11,839

5.8

49,961

50,270

(0.6)

Silverstream (koz)

748

684

9.4

796

(6.0)

3,134

2,780

12.7

Total Silver (koz)

13,276

12,914

2.8

12,635

5.1

53,095

53,050

0.1

Gold (oz)

149,792

150,313

(0.3)

228,193

(34.4)

751,203

769,618

(2.4)

Lead (t)

12,244

11,837

3.4

15,340

(20.2)

56,573

63,242

(10.5)

Zinc (t)

23,726

22,899

3.6

25,881

(8.3)

99,397

106,793

(6.9)


Financial Performance

 

2021

2020

2019

2018

2017

2016

2015

2014

2013

2012

Total attributable silver
production incl. Silverstream (Moz)

53.1

53.1

54.6

61.8

58.7

53.0

47.0

45.0

43.0

41.0

Attributable Gold Production (koz)

751.2

769.6

875.9

922.5

911.1

935.5

761.7

596.0

425.8

473.0

EBITDA (millions of US$)

1,206.3

1,169.1

674.0

915.1

1,060.1

1,032.0

547.5

567.3

729.8

1,315.3

Cash flow from operating activities
before changes in working capital
(millions of US$)

1,208.3

1,168.7

685.5

930.7

1,073.7

1,023.3

537.3

568.5

750.2

1,356.7


Decade of progress and achievement

Prelims 27FEB17 Decade Of Progress And Achievement

Key Commitments and Targets

1. Explore » Ensure business continuity and growth by replenishing depleted reserves and maintaining a robust growth pipeline
Evaluate early-state acquisitions and maintain reserves for 10 years. Ensure organic growth and assess key acquisition opportunities.
2. Develop » Deliver growth through development projects
Deliver profitable growth by advancing new projects towards commissioning, whist optimising cash flow and returns. Maintain track record of delivery on time and on budget and focus on CAPEX control as well as specialised engineering and construction teams.
3. Operate » Maximise the potential of exisiting operations
Maximise our potential of exisiting operations whilst maintaing our position as leading low cost producer. Operate at 100% capacity and remain a low-cost producer whilst optimising mining methods and metallurgy to maintain high recovery rates.
4. Sustain » Advance and enhance the sustainability of our business and uphold our licence to operate
Strengthen our safety performance with zero tolerance for non-compliance, and increase investment and support for training and oversight. Improve general health and minimise environmental impact whilst maintaining sound relations within our communities.