First Majestic says silver production up 4.0% in Q3

First Majestic Silver Corp. [AG-TSX, AG-NYSE, FMV-Frankfurt] said it produced 5.5 million silver equivalent (AgEq) ounces in the third quarter of 2024, consisting of 1.97 million ounces of silver and 41,761 ounces of gold. That marked a 4.0% increase compared to the second quarter of 2024.

The company said it generated revenue of $146.1 million in the third quarter, a 10% increase compared to $133.2 million in the third quarter of 2023.

First Majestic is focused on silver and gold production in Mexico and the U.S. The company currently owns and operates the San Dimas silver/gold mine and the La Encantada silver mine (in Mexico). It also holds a portfolio of development and exploration assets, including the Jerritt Canyon gold project in northeastern Nevada.

In addition, the company also owns and operates its own minting facility, First Mint LLC.

The company said the increase in revenue in Q3 was primarily attributable to higher average realized silver prices, partially offset by a decrease in payable AgEq ounces primarily due to lower production levels at San Dimas and higher inventory levels held at the end of the third quarter of 2024.

Earnings before income, tax, depreciation and amortization (EBITDA) was $36.9 million in the third quarter, up from $11.5 million in the third quarter of 2023. The increase in EBITDA was primarily attributable to the increase in mine operating earnings and lower restructuring costs, related to work force optimization mainly at San Dimas, compared with the third quarter of 2023.

However, the net loss for the quarter was $26.6 million ($0.09 per share) compared to a net loss of $27.1 million ($0.09) in the third quarter of 2023. The Q3 net loss includes a non-cash foreign exchange loss of $5.8 million ($0.02 per) and a non-cash deferred income tax expense of $13.2 million ($0.04), relating primarily to the weakening Mexican peso at the end of the quarter compared with the third quarter of 2023.

Meanwhile, the company declared a cash dividend of 48 cents per common share for the third quarter of 2024 for shareholders of record as of the close of business on November 15, 2024, to be paid out on or about November 29, 2024. First Majestic recently agreed to acquire all of the outstanding shares of Gatos Silver Inc. [GATO-TSX, NYSE].

Gatos is a silver-dominant producer with a 70% interest in the Los Gatos Joint Venture, which owns the producing Cerro Los Gatos underground silver mine in Chihuahua, Mexico.

First Majestic said the deal would consolidate three world-class, producing silver mining districts in Mexico under one banner: They include Cerro Los Gatos, San Dimas and Santa Elena, collectively providing for the foundation of a diversified, intermediate primary silver producer.

First Majestic shares eased 1.3% or 12 cents to $9.26 in early trading Friday. The shares trade in a 52-week range of $11.58 and $5.67.