73% Increase Over Q3 2019
Sierra Metals Inc. (TSX: SMT) has reported revenue of US$73.2 million and adjusted EBITDA of US$37.2 million on the throughput of 798,458 tonnes and metal production of 35.2 million copper equivalent pounds, or 4.2 million silver equivalent ounces, for the three month period ended September 30, 2020.
The company achieved record quarterly consolidated equivalent copper production and ore throughput, driven by a strong operational performance at its three mines despite the difficulties arising from the COVID-19 pandemic. Consolidated production of copper equivalent pounds increased 9% to 35.2 million pounds.
CEO, Luis Marchese, said higher revenues are primarily attributable to the 24% increase in throughput, in addition to higher gold head grades and higher recoveries at Bolivar, as well as increased head grades and recoveries, except silver recoveries at Cusi. Quarterly revenues were also boosted by the higher realized prices for all metals.
Quarterly revenues at Yauricocha were in line with the third quarter of 2019, as lower metal sales and increased treatment and refining charges offset the impact of higher metal prices.
“I am very pleased with the solid financial and production results achieved in the third quarter,” Mr Marchese said.
We have continued to improve production rates at Bolivar and Cusi and continued to recover annual production tonnage lost at Yauricocha due to the COVID-19 pandemic. The robust production in the third quarter, along with improved operational efficiencies and improved metal prices, has resulted in record adjusted EBITDA for the Company. We also reported strong cash flow and net income.
“The company continues to realise the benefits of our optimized operations and expansions ramp up, which provides for stronger financial and operational performances, which we expect to continue through the upcoming year.
“These improvements have enhanced the competitive position of both the Bolivar and Yauricocha mines within the cost curve for the global copper mining industry, with both mines now positioned in the lowest half of the cash cost curve.
“The COVID-19 situation in Peru and Mexico remains very serious and is an important factor in our daily operations. Protecting our employees, the communities in which we operate, and our operations are extremely important to us; as such, we continue adhering to strict health protocols.
“Testing and quarantining have helped identify and keep active cases from occurring in the mines, but as a result, we are operating with a lower than optimal headcount. We appreciate all our employee’s hard work in helping the mines to run safely, efficiently, and in helping us achieve the strong third quarter results.”
“We have reinitiated exploration and infrastructure projects at all mines that had been paused during the COVID-19 shutdowns. These programmes and improvements are expected to help improve mine operations, production efficiencies as well as enable us to continue discovering and developing new and existing mineral resource opportunities. Barring any further COVID-19 work interruptions, the fourth quarter should help us to realize a strong finish for the year.”