Wheaton Precious Metals Reports Strong Growth in Earnings and Cash Flow and Declares Fourth Quarterly Dividend of 2019
FOR IMMEDIATE RELEASE TSX: WPM November 14, 2019 NYSE: WPM
WHEATON PRECIOUS METALS REPORTS STRONG GROWTH IN EARNINGS AND CASH FLOW AND DECLARES FOURTH QUARTERLY DIVIDEND OF 2019
Vancouver, British Columbia – Wheaton Precious Metals™ Corp. (“Wheaton” or the “Company”) is pleased to announce its results for the third quarter ended September 30, 2019. All figures are presented in United States dollars unless otherwise noted.
In the third quarter of 2019, Wheaton generated over $140 million in operating cash flow resulting in adjusted net earnings of over $70 million, an increase of 31% and 107%, respectively. In addition, Wheaton had attributable gold production of over 100,000 ounces and remains on track for record annual gold production in 2019.
Operational Overview
| Q3 2019 | Q3 2018 Change | ||
|---|---|---|---|
| Ounces produced Gold Silver Palladium Gold equivalent 2 Ounces sold Gold Silver Palladium Gold equivalent 2 | 106,255 (2.0)% 5,584 9.2 % 8,817 (37.9)% 184,139 0.4 % 89,242 6.2 % 5,018 (10.6)% 3,668 33.8 % 154,815 0.2 % | ||
| 104,175 | |||
| 6,095 | |||
| 5,471 | |||
| 184,868 | |||
| 94,766 | |||
| 4,484 | |||
| 4,907 | |||
| 155,049 | |||
| Sales price per ounce Gold Silver Palladium Cash costs per ounce 1 Gold 1 Silver 1 Palladium 1 Cash operating margin per ounce 1 Gold 1 Silver 1 Palladium 1 | $ 1,210 21.6 % $ 14.80 15.5 % $ 955 60.7 % $ 418 1.4 % $ 5.04 2.4 % $ 169 60.2 % $ 792 32.2 % $ 9.76 22.2 % $ 786 60.8 % | ||
| $ | 1,471 | ||
| $ | 17.09 | ||
| $ | 1,535 | ||
| $ | 424 | ||
| $ | 5.16 | ||
| $ | 271 | ||
| $ | 1,047 | ||
| $ | 11.93 | ||
| $ | 1,264 | ||
| Revenue Net earnings Per share Adjusted net earnings 1 Per share 1 Operating cash flows Per share 1 Dividends declared 1 Per share | $ | 223,595 | $ 185,769 20.4 % $ 34,021 123.3 % $ 0.08 112.5 % $ 35,132 106.9 % $ 0.08 105.4 % $ 108,413 31.3 % $ 0.24 33.3 % $ 39,921 0.7 % $ 0.09 0.0 % |
| $ | 75,960 | ||
| $ | 0.17 | ||
| $ | 72,692 | ||
| $ | 0.16 | ||
| $ | 142,300 | ||
| $ | 0.32 | ||
| $ | 40,197 | ||
| $ | 0.09 |
All amounts in thousands except gold, palladium and gold equivalent ounces produced and sold, per ounce amounts and per share amounts.1
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Highlights
- Wheaton generated $142 million in operating cash flow in the third quarter of 2019, leading to a reduction in net debt of $146 million.
- Attributable gold production was relatively unchanged primarily due to higher production at Salobo and San Dimas being offset by lower production at the Stillwater mines due to reported production for the third quarter of 2018 including some material processed in prior periods.
- The increase in attributable silver production was primarily due to higher grades at Peñasquito.
- The decrease in attributable palladium production was due to lower production at the Stillwater mines due to reported production for the third quarter of 2018 including some material processed in prior periods.
- The increase in gold sales volume was due to positive changes in the balance of payable gold produced but not yet delivered to Wheaton, partially offset by lower production levels.
- The decrease in silver sales volume was due to negative changes in the balance of payable silver produced but not yet delivered to Wheaton at Peñasquito, partially offset by the higher production levels.
- The increase in adjusted net earnings was primarily due to higher margins resulting from increased realized prices for gold, silver and palladium sales of 22%, 15% and 61%, respectively.
- Declared quarterly dividend of $0.09 per common share in accordance with Wheaton’s setting of a minimum quarterly dividend of $0.09 per common share for the duration of 2019, subject to the discretion of the Board of Directors.
- In September, Wheaton joined the United Nations Global Compact and announced its endorsement of the World Gold Council’s Responsible Gold Mining Principles, demonstrating the company’s continued commitment to corporate sustainability.
Updating Production Guidance
- Wheaton is updating production guidance for 2019, with estimated attributable gold production being increased to approximately 390,000 ounces due to continued outperformance primarily from the Salobo mine, while estimated attributable silver production has been adjusted to approximately 21 million ounces to reflect production interruptions at the Peñasquito mine. Forecast palladium production in 2019 remains unchanged at approximately 22,000 ounces.
- For the five-year period ending in 2023, the Company continues to estimate that average annual gold equivalent production2 will amount to 750,000 ounces.
“Wheaton’s portfolio of high-quality, long-life assets continues to deliver strong results with over $140 million in operating cash flow generated in the third quarter of 2019,” said Randy Smallwood, President and Chief Executive Officer of Wheaton Precious Metals. “Gold and silver prices increased on average approximately 17% over the previous year, while our cash flow and net earnings increased by over 30% and 100%, respectively. These solid results once again demonstrate the strength of Wheaton’s business model, which focuses on reducing risk while providing significant leverage to higher commodity prices.”
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Financial Review
Revenues
Revenue was $224 million in the third quarter of 2019, on sales volume of 94,800 ounces of gold, 4.5 million ounces of silver and 4,900 ounces of palladium. This represents a 20% increase from the $186 million of revenue generated in the third quarter of 2018 due primarily to (i) a 22% increase in the average realized gold price ($1,471 in Q3 2019 compared with $1,210 in Q3 2018); (ii) a 15% increase in the average realized silver price ($17.09 in Q3 2019 compared with $14.80 in Q3 2018); and (iii) a 6% increase in the number of gold ounces sold; partially offset by (iv) an 11% decrease in the number of silver ounces sold.
Costs and Expenses
Average cash costs¹ in the third quarter of 2019 were $424 per gold ounce sold, $5.16 per silver ounce sold and $271 per palladium ounce sold, as compared with $418 per gold ounce, $5.04 per silver ounce and $169 per palladium ounce during the comparable period of 2018. This resulted in a cash operating margin¹ of $1,047 per gold ounce sold, $11.93 per silver ounce sold and $1,264 per palladium ounce sold, an increase of 32%, 22% and 61%, respectively, as compared with Q3 2018. The increase in the cash operating margin was primarily due to a 22%, 15% and 61% increase in the average realized gold, silver and palladium price, respectively, during Q3 2019 compared with Q3 2018.
Adjusted Net Earnings and Operating Cash Flows
Adjusted net earnings¹ and cash flow from operations in the third quarter of 2019 were $73 million ($0.16 per share) and $142 million ($0.32 per share¹), compared with adjusted net earnings¹ of $35 million ($0.08 per share) and cash flow from operations of $108 million ($0.24 per share¹) for the same period in 2018, an increase of 107% and 31%, respectively.
Balance Sheet
At September 30, 2019, the Company had approximately $152 million of cash on hand and $1.0 billion outstanding under the Company's $2 billion revolving term loan (the "Revolving Facility"). The Company uses excess cash to pay down the Revolving Facility, and during the three-month period ended September 30, 2019, the Company has repaid $82 million under the Revolving Facility. The average effective interest rate for the third quarter of 2019 was 4.02%.
Third Quarter Asset Highlights
Operational highlights for the quarter ended September 30, 2019, are as follows:
Salobo
In the third quarter of 2019, Salobo produced 73,600 ounces of attributable gold, virtually unchanged relative to the third quarter of 2018 as higher throughput was almost completely offset by lower grades and recovery. In Vale S.A.’s (“Vale”) Third Quarter 2019 Performance Report, Vale reports that in July, Salobo achieved all-time monthly production records for copper and gold. Vale also noted that physical completion of the expansion at Salobo is now 27%, including the completion of the concrete foundations for the mill and primary crusher bases and the arrival to site of the first loads related to the long-distance conveyor belt.
Peñasquito
In the third quarter of 2019, Peñasquito produced 2.0 million ounces of attributable silver, an increase of approximately 93% relative to the third quarter of 2018 primarily due to higher
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grades. As per Newmont Goldcorp Corporation’s (“Newmont”) third quarter MD&A, production at Peñasquito was impacted by the operation being placed into care and maintenance for 17 days in the third quarter of 2019 due to a blockade. The blockade was lifted in early October 2019; a gradual ramp up of operations started in late October while government-sponsored negotiations continue. Based on Newmont’s disclosure, the impact of the illegal blockade on Wheaton’s third quarter attributable production was approximately 0.4 million silver ounces.
Sudbury
In the third quarter of 2019, Vale’s Sudbury mines produced 6,600 ounces of attributable gold, an increase of approximately 2% relative to the third quarter of 2018 primarily due to higher grades. Throughput at the Sudbury mines is typically lower in the third quarter as a result of planned maintenance shutdowns occurring in the summer months. This was consistent in 2018 and 2019.
Constancia
In the third quarter of 2019, Constancia produced 0.7 million ounces of attributable silver and 5,200 ounces of attributable gold, an increase of approximately 1% and 42%, respectively, relative to the third quarter of 2018. As per Wheaton’s precious metals purchase agreement with Hudbay Minerals Inc. (“Hudbay”) relating to Constancia (the “Constancia PMPA”), should Hudbay fail to achieve a minimum level of throughput at the Pampacancha satellite deposit during 2018, 2019 and 2020, Wheaton will be entitled to an increased portion of gold from Hudbay. As per Hudbay’s MD&A for the first quarter of 2019, mining of the Pampacancha deposit is not expected to begin until later in 2020. Assuming ore production does not begin until 2020, the Company will be entitled to receive an additional 8,020 ounces of gold in 2019 and 2020 relative to the Constancia PMPA, with the deliveries to be made in quarterly installments, of which 2,005 ounces were received during the third quarter of 2019 and reported as production.
Stillwater
In the third quarter of 2019, the Stillwater mines produced 3,200 ounces of attributable gold and 5,500 ounces of attributable palladium, a decrease of approximately 49% for gold and 38% for palladium relative to the third quarter of 2018. The decreases relative to the third quarter of 2019 was largely due to reported production for the third quarter of 2018 including some material processed in prior periods. As part of the agreement, Wheaton was entitled to the attributable gold and palladium production for which an offtaker payment was received after July 1, 2018.
Other Gold
In the third quarter of 2019, total Other Gold attributable production was 4,300 ounces, a decrease of approximately 36% relative to the third quarter of 2018. The decrease was due primarily to the cessation of production at the Minto mine which was placed on care and maintenance in the fourth quarter of 2018. According to Pembridge Resources plc’s news release dated October 16, 2019, mining has restarted at Minto in October with milling operations recommencing on October 10, 2019. Wheaton does not currently include any additional production from Minto in its 2019 or five-year guidance.
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Other Silver
In the third quarter of 2019, total Other Silver attributable production was 2.2 million ounces, a decrease of approximately 12% relative to the third quarter of 2018. The decrease was driven primarily by lower production from the Aljustrel mine partially offset by higher production from Zinkgruvan.
Development Update – Rosemont
On August 1, 2019, Hudbay announced that the U.S. District Court for the District of Arizona (“Court”) issued a ruling in the lawsuits challenging the U.S. Forest Service’s issuance of the Final Record of Decision (“FROD”) for the Rosemont project in Arizona. The Court ruled to vacate and remand the FROD such that Rosemont cannot proceed with construction at this time. Hudbay stated that they believe that the Court has misinterpreted federal mining laws and Forest Service regulations as they apply to Rosemont. As such, Hudbay is working to appeal the Court's decision to the U.S. Ninth Circuit Court of Appeals as they evaluate next steps for the project. As announced in August, Hudbay has suspended most of its early works activities at Rosemont and has deferred the previously announced process to identify a joint venture partner for Rosemont. Wheaton has not made any upfront payments to date relative to Rosemont nor included any production from Rosemont in its five-year guidance.
Produced But Not Yet Delivered 3
As at September 30, 2019, payable ounces attributable to the Company produced but not yet delivered amounted to 85,500 payable gold ounces, 4.2 million payable silver ounces and 4,200 payable palladium ounces, an increase of 4,300 payable gold ounces and 0.7 million payable silver ounces and a decrease of 300 payable palladium ounces during the three month period ended September 30, 2019. Payable gold ounces produced but not yet delivered increased primarily as a result of an increase related to the Salobo gold interest partially offset by a decrease at Sudbury. Payable silver ounces produced but not yet delivered increased slightly primarily as a result of increases related to the Peñasquito and Antamina silver interests. Payable ounces produced but not yet delivered to Wheaton are expected to average approximately two months of annualized production for silver and two to three months for both gold and palladium but may vary from quarter to quarter due to a number of mining operation factors including mine ramp-up and timing of shipments.
Detailed mine-by-mine production and sales figures can be found in the Appendix to this press release and in Wheaton’s consolidated MD&A in the ‘Results of Operations and Operational Review’ section.
Dividend
Fourth Quarterly Dividend
The fourth quarterly cash dividend for 2019 of US$0.09 will be paid to holders of record of Wheaton Precious Metals common shares as of the close of business on December 4, 2019 and will be distributed on or about December 16, 2019.
Under the Company’s dividend policy, the quarterly dividend per common share is targeted to equal approximately 30% of the average cash generated by operating activities in the previous four quarters divided by the Company’s then outstanding common shares, all rounded to the nearest cent. To minimize volatility in quarterly dividends, the Company has set a minimum quarterly dividend of $0.09 per common share for the duration of 2019.
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The declaration, timing, amount and payment of future dividends remain at the discretion of the Board of Directors. This dividend qualifies as an ‘eligible dividend’ for Canadian income tax purposes.
Dividend Reinvestment Plan
The Company has previously implemented a Dividend Reinvestment Plan (“DRIP”). Participation in the DRIP is optional. For the purposes of this fourth quarterly dividend, the Company has elected to issue common shares under the DRIP through treasury at a 3% discount to the Average Market Price, as defined in the DRIP. However, the Company may, from time to time, in its discretion, change or eliminate the discount applicable to Treasury Acquisitions, as defined in the DRIP, or direct that such common shares be purchased in Market Acquisitions, as defined in the DRIP, at the prevailing market price, any of which would be publicly announced.
The DRIP and enrollment forms, including direct deposit, are available for download on the Company’s website at www.wheatonpm.com, accessible by quick links directly from the home page, and can also be found in the ‘investors’ section, under the ‘dividends’ tab.
Registered shareholders may also enroll in the DRIP online through the plan agent’s selfservice web portal at:
https://www.canstockta.com/en/InvestorServices/Investor_Information/Issuer_List/IssuerDet ail.jsp?companyCode=1501.
Beneficial shareholders should contact their financial intermediary to arrange enrollment. All shareholders considering enrollment in the DRIP should carefully review the terms of the DRIP and consult with their advisors as to the implications of enrollment in the DRIP.
This press release is not an offer to sell or a solicitation of an offer of securities. A registration statement relating to the DRIP has been filed with the U.S. Securities and Exchange Commission and may be obtained under the Company’s profile on the U.S. Securities and Exchange Commission’s website at http://www.sec.gov. A written copy of the prospectus included in the registration statement may be obtained by contacting the Corporate Secretary of the Company at 1021 West Hastings Street, Suite 3500, Vancouver, British Columbia, Canada V6E 0C3.
Outlook
Wheaton is updating production guidance for 2019. Estimated attributable gold production has been increased to approximately 390,000 ounces, up from 385,000 ounces previously forecast due to continued outperformance primarily from the Salobo mine. Estimated attributable silver production has been adjusted to approximately 21 million ounces from 22.5 million ounces to reflect production interruptions at the Peñasquito mine. Forecast production of palladium in 2019 remains unchanged at approximately 22,000 ounces. For the five-year period ending in 2023, the Company estimates that average annual gold equivalent production2 will amount to 750,000 ounces. As a reminder, Wheaton does not currently include any production from Hudbay’s Rosemont project nor the announced expansion at Salobo in its estimated average five-year production guidance4.
From a liquidity perspective, the $152 million of cash and cash equivalents as at September 30, 2019, combined with the liquidity provided by the available credit under the $2 billion Revolving Facility and ongoing operating cash flows positions the Company well to fund all outstanding
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commitments and known contingencies as well as providing flexibility to acquire additional accretive precious metal stream interests.
Webcast and Conference Call Details
A conference call and webcast will be held Friday, November 15, 2019, starting at 11:00 am (Eastern Time) to discuss these results. To participate in the live call, please use one of the following methods:
Dial toll free from Canada or the US: 888-231-8191 Dial from outside Canada or the US: 647-427-7450 Pass code: 6890657 Live audio webcast: Click here
Participants should dial in five to ten minutes before the call.
The conference call will be recorded and available until November 22, 2019 at 11:59 pm (Eastern Time). The webcast will be available for one year. You can listen to an archive of the call by one of the following methods:
Dial toll free from Canada or the US: 855-859-2056 Dial from outside Canada or the US: 416-849-0833 Pass code: 6890657 Archived audio webcast: Click here
This earnings release should be read in conjunction with Wheaton Precious Metals’ MD&A and Financial Statements, which are available on the Company’s website at www.wheatonpm.com and have been posted on SEDAR at www.sedar.com.
Mr. Wes Carson, P. Eng., Vice President, Mining Operations is a “qualified person” as such term is defined under National Instrument 43-101 and has reviewed and approved the technical information disclosed in this news release.
Wheaton Precious Metals believes that there are no significant differences between its corporate governance practices and those required to be followed by United States domestic issuers under the NYSE listing standards. This confirmation is located on the Wheaton Precious Metals website at http://www.wheatonpm.com/Company/corporate-governance/default.aspx.
End Notes
1 Please refer to non-IFRS measures at the end of this press release. Dividends declared in the referenced calendar quarter, relative to the financial results of the prior quarter.
2 Commodity price assumptions for the gold equivalent production and sales, including forecasts for 2019 and the five-year average, are unchanged since the original forecasts at $1,300 / ounce gold, $16 / ounce silver, $1,350 / ounce palladium, and $21 / pound of cobalt.
3 Payable gold, silver and palladium ounces produced but not yet delivered are based on management estimates and may be updated in future periods as additional information is received.
4 In preparing the long-term production forecast, Wheaton has considered the impact of Vale’s announced approval of the Salobo III copper project, a brownfield expansion, which if completed as proposed, would increase processing throughput capacity from 24 Mtpa to 36 Mtpa once fully ramped up (the “Salobo Expansion”). However, readers are cautioned that Vale has not finalized its mine plan and as such, Wheaton has not included any production growth as a result of the Salobo Expansion.
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Condensed Interim Consolidated Statements of Earnings
Three Months Ended Nine Months Ended September 30 September 30
| (US dollars and shares in thousands, except per share amounts - unaudited) | 2018 | 2018 | ||||
| 2019 | 2019 | |||||
| Sales | $ 185,769 | $ 597,421 | ||||
| $ | 223,595 | $ | 638,110 | |||
| Cost of sales Cost of sales, excluding depletion Depletion | $ 63,202 64,684 | $ 182,195 184,444 | ||||
| $ | 64,624 | $ | 194,796 | |||
| 63,396 | 193,180 | |||||
| Total cost of sales | $ 127,886 | $ 366,639 | ||||
| $ | 128,020 | $ | 387,976 | |||
| Gross margin General and administrative Impairment charges | $ 57,883 8,779 - | $ 230,782 30,507 - | ||||
| $ | 95,575 | $ | 250,134 | |||
| 14,028 | 42,811 | |||||
| - | 165,912 | |||||
| Earnings from operations Gain on disposal of mineral stream interest Other (income) expense | $ 49,104 - 1,301 | $ 200,275 (245,715) 1,157 | ||||
| $ | 81,547 | $ | 41,411 | |||
| - | - | |||||
| (3,533) | (709) | |||||
| Earnings before finance costs and income taxes Finance costs | $ 47,803 12,877 | $ 444,833 27,351 | ||||
| $ | 85,080 | $ | 42,120 | |||
| 11,871 | 39,123 | |||||
| Earnings before income taxes Income tax recovery (expense) | $ 34,926 (905) | $ 417,482 2,805 | ||||
| $ | 73,209 | $ | 2,997 | |||
| 2,751 | 5,618 | |||||
| Net earnings | $ 34,021 | $ 420,287 | ||||
| $ | 75,960 | $ | 8,615 | |||
| Basic earnings per share Diluted earnings per share Weighted average number of shares outstanding Basic Diluted | $ 0.08 $ 0.08 443,634 444,120 | $ 0.95 $ 0.95 443,188 443,727 | ||||
| $ | 0.17 | $ | 0.02 | |||
| $ | 0.17 | $ | 0.02 | |||
| 446,802 | 445,598 | |||||
| 447,849 | 446,467 |
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Condensed Interim Consolidated Balance Sheets
| (US dollars in thousands - unaudited) | As at September 30 | As at December 31 2018 | |||
|---|---|---|---|---|---|
| 2019 | |||||
| Assets Current assets Cash and cash equivalents Accounts receivable Current taxes receivable Other | $ 75,767 2,186 210 1,541 | ||||
| $ | 151,626 | ||||
| 3,613 | |||||
| 100 | |||||
| 2,067 | |||||
| Total current assets | $ | 157,406 | $ 79,704 | ||
| Non-current assets Mineral stream interests Early deposit mineral stream interests Mineral royalty interest Long-term equity investments Investment in associates Convertible note receivable Property, plant and equipment Other | $ 6,156,839 30,241 9,107 164,753 2,562 12,899 3,626 10,315 | ||||
| $ | 5,797,752 | ||||
| 31,741 | |||||
| 3,036 | |||||
| 234,838 | |||||
| 935 | |||||
| 12,222 | |||||
| 7,513 | |||||
| 13,416 | |||||
| Total non-current assets | $ | 6,101,453 | $ 6,390,342 | ||
| Total assets | $ | 6,258,859 | $ 6,470,046 | ||
| Liabilities Current liabilities Accounts payable and accrued liabilities Current taxes payable Current portion of performance share units Current portion of lease liabilities Other | $ 19,883 3,361 5,578 - 19 | ||||
| $ | 23,491 | ||||
| - | |||||
| 9,513 | |||||
| 657 | |||||
| 16 | |||||
| Total current liabilities | $ | 33,677 | $ 28,841 | ||
| Non-current liabilities Bank debt Lease liabilities Deferred income taxes Performance share units | $ 1,264,000 - 111 5,178 | ||||
| $ | 1,013,500 | ||||
| 3,632 | |||||
| 134 | |||||
| 6,472 | |||||
| Total non-current liabilities | $ | 1,023,738 | $ 1,269,289 | ||
| Total liabilities | $ | 1,057,415 | $ 1,298,130 | ||
| Shareholders' equity Issued capital Reserves Retained earnings | $ 3,516,437 7,893 1,647,586 | ||||
| $ | 3,583,654 | ||||
| 87,758 | |||||
| 1,530,032 | |||||
| Total shareholders' equity | $ | 5,201,444 | $ 5,171,916 | ||
| Total liabilities and shareholders' equity | $ | 6,258,859 | $ 6,470,046 |
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Condensed Interim Consolidated Statements of Cash Flows
Three Months Ended Nine Months Ended September 30 September 30
| (US dollars in thousands - unaudited) | 2018 | 2018 | ||||
| 2019 | 2019 | |||||
| Operating activities Net earnings Adjustments for Depreciation and depletion Gain on disposal of mineral stream interest Gain on disposal of mineral royalty interest Impairment charges Interest expense Equity settled stock based compensation Performance share units Income tax expense (recovery) (Gain) loss on fair value adjustment of share purchase warrants held Share in losses of associate Fair value (gain) loss on convertible note receivable Investment income recognized in net (loss) earnings Other Change in non-cash working capital | $ 34,021 64,974 - - - 11,806 1,402 (85) 905 12 172 927 (109) (1,322) 3,701 | $ 420,287 185,206 (245,715) - - 23,055 4,045 3,415 (2,805) 123 373 2,217 (611) (809) (1,142) | ||||
| $ | 75,960 | $ | 8,615 | |||
| 63,845 | 194,590 | |||||
| - | - | |||||
| (2,929) | (2,929) | |||||
| - | 167,561 | |||||
| 10,885 | 36,473 | |||||
| 1,447 | 4,259 | |||||
| 4,803 | 5,004 | |||||
| (2,751) | (5,618) | |||||
| (2) | 5 | |||||
| 49 | 111 | |||||
| (386) | 677 | |||||
| (205) | (745) | |||||
| (540) | 130 | |||||
| 2,093 | (421) | |||||
| Cash generated from operations before income taxes and interest Income taxes paid Interest paid Interest received | $ | 152,269 | $ 116,404 (742) (7,395) 146 | $ | 407,712 | $ 387,639 (844) (18,450) 608 |
| (1,751) | (5,334) | |||||
| (8,404) | (33,311) | |||||
| 186 | 686 | |||||
| Cash generated from operating activities | $ 108,413 | $ 368,953 | ||||
| $ | 142,300 | $ | 369,753 | |||
| Financing activities Bank debt repaid Bank debt drawn Credit facility extension fees Share purchase options exercised Lease payments Dividends paid | $ (28,000) 452,000 - - - (33,873) | $ (214,000) 824,500 (1,205) 1,027 - (98,462) | ||||
| $ | (82,000) | $ | (250,500) | |||
| - | - | |||||
| (3) | (1,103) | |||||
| 12,662 | 33,055 | |||||
| (156) | (479) | |||||
| (32,609) | (96,124) | |||||
| Cash (used for) generated from financing activities | $ 390,127 | $ 511,860 | ||||
| $ | (102,106) | $ | (315,151) | |||
| Investing activities Mineral stream interests Early deposit mineral stream interests Proceeds on disposal of mineral royalty interest Net proceeds on disposal of mineral stream interests Acquisition of long-term investments Investment in associate Proceeds on disposal of long-term investments Dividend income received Other | $ (506,171) (4,254) - (4,000) (4,847) - 47,734 20 (664) | $ (1,116,406) (8,712) - 226,000 (5,863) - 47,734 60 (3,089) | ||||
| $ | (9) | $ | (183) | |||
| (750) | (1,500) | |||||
| 9,000 | 9,000 | |||||
| - | - | |||||
| - | (909) | |||||
| - | (132) | |||||
| 16,307 | 16,307 | |||||
| 20 | 59 | |||||
| (313) | (1,520) | |||||
| Cash used for investing activities | $ (472,182) | $ (860,276) | ||||
| $ | 24,255 | $ | 21,122 | |||
| Effect of exchange rate changes on cash and cash equivalents | $ | (5) | $ 354 | $ | 135 | $ 315 |
| Increase in cash and cash equivalents Cash and cash equivalents, beginning of period | $ 26,712 92,661 | $ 20,852 98,521 | ||||
| $ | 64,444 | $ | 75,859 | |||
| 87,182 | 75,767 | |||||
| Cash and cash equivalents, end of period | $ 119,373 | $ 119,373 | ||||
| $ | 151,626 | $ | 151,626 |
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Summary of Ounces Produced
| Q4 2018 Q3 2018 Q2 2018 Q1 2018 Q4 2017 | ||||
|---|---|---|---|---|
| Q3 2019 | Q2 2019 | Q1 2019 | ||
| Gold ounces produced ² Salobo Sudbury 3 Constancia San Dimas 4 Stillwater Other Minto 5 777 | 76,995 72,423 67,466 64,896 80,341 6,646 6,510 6,476 3,511 8,568 4,266 3,634 3,281 3,315 2,947 10,092 10,642 5,726 - - 3,472 6,376 - - - 1,441 2,546 2,554 2,707 3,328 4,248 4,124 4,982 5,645 5,478 | |||
| 73,615 | 67,056 | 60,846 | ||
| 6,633 | 9,029 | 11,374 | ||
| 5,172 | 4,533 | 4,826 | ||
| 11,239 | 11,496 | 10,290 | ||
| 3,238 | 3,675 | 3,137 | ||
| - | - | - | ||
| 4,278 | 4,788 | 4,445 | ||
| Total Other | 4,278 | 4,788 | 4,445 | 5,689 6,670 7,536 8,352 8,806 |
| Total gold ounces produced | 107,160 106,255 90,485 80,074 100,662 | |||
| 104,175 | 100,577 | 94,918 | ||
| Silver ounces produced 2 San Dimas 4 Peñasquito Antamina Constancia Other Los Filos Zinkgruvan Yauliyacu Stratoni Minto 5 Neves-Corvo Aljustrel Lagunas Norte 6 Pierina 6 Veladero 6 777 | - - 607 1,606 1,324 1,455 1,050 1,267 1,450 1,561 1,225 1,406 1,394 1,304 1,434 695 682 552 598 621 29 21 33 29 48 608 530 453 565 619 233 597 719 550 335 149 165 211 137 131 8 25 30 35 30 509 458 421 405 305 475 514 138 - - - - - 217 253 - - - 107 111 - - - 265 211 113 136 152 146 146 | |||
| - | - | - | ||
| 2,031 | 702 | 1,595 | ||
| 1,224 | 1,343 | 1,180 | ||
| 686 | 552 | 635 | ||
| 40 | 37 | 38 | ||
| 630 | 631 | 479 | ||
| 620 | 627 | 528 | ||
| 131 | 172 | 143 | ||
| - | - | - | ||
| 431 | 392 | 498 | ||
| 240 | 322 | 470 | ||
| - | - | - | ||
| - | - | - | ||
| - | - | - | ||
| 62 | 93 | 95 | ||
| Total Other | 2,154 | 2,274 | 2,251 | 2,124 2,446 2,157 2,456 2,189 |
| Total silver ounces produced | 5,499 5,584 5,977 7,414 7,129 | |||
| 6,095 | 4,871 | 5,661 | ||
| Palladium ounces produced ² Stillwater | 5,869 8,817 - - - | |||
| 5,471 | 5,736 | 4,729 | ||
| GEOs produced 7 SEOs produced 7 | 180,936 184,139 164,043 171,328 188,408 14,701 14,961 13,329 13,920 15,308 | |||
| 184,868 | 166,483 | 169,506 | ||
| 15,020 | 13,527 | 13,772 | ||
| Average payable rate 2 Gold Silver Palladium | 95.5% 95.4% 94.9% 94.7% 95.0% 83.1% 83.5% 86.8% 89.7% 90.1% 96.4% 94.6% n.a. n.a. n.a. | |||
| 95.1% | 95.3% | 95.6% | ||
| 85.2% | 83.4% | 83.0% | ||
| 83.5% | 87.6% | 98.5% |
1) All figures in thousands except gold and palladium ounces produced.
2) Ounces produced represent the quantity of gold, silver and palladium contained in concentrate or doré prior to smelting or refining deductions. Production figures and average payable rates are based on information provided by the operators of the mining operations to which the mineral stream interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
3) Comprised of the Coleman, Copper Cliff, Garson, Stobie, Creighton and Totten gold interests. The Stobie gold interest was placed into care and maintenance as of May 2017.
4) Pursuant to the San Dimas SPA with Primero, the Company acquired 100% of the payable silver produced at San Dimas up to 6 million ounces annually, and 50% of any excess for the life of the mine. The San Dimas SPA was terminated on May 10, 2018 and concurrently the Company entered into the new San Dimas PMPA.
5) The Minto mine was placed into care and maintenance in October 2018.
6) In accordance with the Pascua-Lama precious metal purchase agreement, all deliveries from Lagunas Norte, Pierina and Veladero ceased effective March 31, 2018.
7) GEOs and SEOs, which are provided to assist the reader, are based on the following commodity price assumptions: $1,300 per ounce gold; $16.00 per ounce silver; and $1,350 per ounce palladium, consistent with those used in estimating the Company's production guidance for 2019. Previously, GEOs and SEOs were calculated by referencing the average LBMA price during the period. This revised methodology of calculating GEOs and SEOs has been applied to all periods presented.
- 12 -
Summary of Ounces Sold
| Q3 2018 Q2 2018 Q1 2018 Q4 2017 | |||||
|---|---|---|---|---|---|
| Q3 2019 | Q2 2019 | Q1 2019 | Q4 2018 | ||
| Gold ounces sold Salobo Sudbury 2 Constancia San Dimas 3 Stillwater Other Minto 4 777 | 65,139 70,734 54,645 71,683 2,560 4,400 5,186 12,059 2,980 2,172 3,247 1,965 9,771 3,738 - - 2,075 - - - 796 2,284 1,763 2,020 5,921 3,812 5,132 6,568 | ||||
| 63,064 | 57,715 | 84,160 | 75,351 | ||
| 7,600 | 8,309 | 4,061 | 4,864 | ||
| 4,742 | 4,409 | 5,512 | 3,645 | ||
| 11,374 | 10,284 | 11,510 | 8,453 | ||
| 3,314 | 3,301 | 2,856 | 3,473 | ||
| - | 765 | 3,307 | 2,674 | ||
| 4,672 | 5,294 | 3,614 | 4,353 | ||
| Total Other | 4,672 | 6,059 | 6,921 | 7,027 | 6,717 6,096 6,895 8,588 |
| Total gold ounces sold | 94,766 | 90,077 | 115,020 | 102,813 | 89,242 87,140 69,973 94,295 |
| Silver ounces sold San Dimas 3 Peñasquito Antamina Constancia Other Los Filos Zinkgruvan Yauliyacu Stratoni Minto 4 Neves-Corvo Aljustrel Lagunas Norte 5 Pierina 5 Veladero 5 777 | - 1,070 1,372 1,299 1,241 1,547 1,227 1,537 1,333 1,422 1,413 1,769 567 410 574 491 27 35 52 16 326 297 391 597 697 521 360 642 125 171 148 110 - 28 (1) 34 234 178 169 119 302 - - - 1 65 236 237 - 54 88 106 2 104 161 211 163 70 153 124 | ||||
| - | - | - | - | ||
| 1,233 | 912 | 1,164 | 901 | ||
| 1,059 | 1,186 | 1,255 | 1,300 | ||
| 521 | 478 | 735 | 629 | ||
| 44 | 26 | 38 | 15 | ||
| 459 | 337 | 232 | 543 | ||
| 574 | 542 | 15 | 317 | ||
| 126 | 240 | 80 | 78 | ||
| - | 2 | 30 | 22 | ||
| 243 | 194 | 265 | 240 | ||
| 139 | 216 | 381 | 226 | ||
| - | - | - | - | ||
| - | - | - | - | ||
| - | - | - | - | ||
| 86 | 108 | 99 | 129 | ||
| Total Other | 1,671 | 1,665 | 1,140 | 1,570 | 1,877 1,523 1,757 2,196 |
| Total silver ounces sold | 4,484 | 4,241 | 4,294 | 4,400 | 5,018 5,972 6,343 7,292 |
| Palladium ounces sold Stillwater | 3,668 - - - | ||||
| 4,907 | 5,273 | 5,189 | 5,049 | ||
| GEOs sold 6 SEOs sold 6 | 155,049 | 147,755 | 173,255 | 162,205 | 154,815 160,627 148,055 184,061 12,579 13,051 12,029 14,955 |
| 12,598 | 12,005 | 14,077 | 13,179 | ||
| Cumulative payable gold ounces PBND 7 | 99,987 88,547 89,839 84,010 | ||||
| 85,468 | 81,161 | 75,236 | 99,474 | ||
| Cumulative payable silver ounces PBND 7 | 3,015 3,375 4,126 3,828 | ||||
| 4,165 | 3,418 | 3,591 | 3,184 | ||
| Cumulative payable palladium ounces PBND 7 | 4,671 - - - | ||||
| 4,163 | 4,504 | 4,754 | 5,282 |
1) All figures in thousands except gold and palladium ounces sold.
2) Comprised of the Coleman, Copper Cliff, Garson, Stobie, Creighton and Totten gold interests. The Stobie gold interest was placed into care and maintenance as of May 2017.
3) Pursuant to the San Dimas SPA with Primero, the Company acquired 100% of the payable silver produced at San Dimas up to 6 million ounces annually, and 50% of any excess for the life of the mine. The San Dimas SPA was terminated on May 10, 2018 and concurrently the Company entered into the new San Dimas PMPA.
4) The Minto mine was placed into care and maintenance in October 2018.
5) In accordance with the Pascua-Lama precious metal purchase agreement, all deliveries from Lagunas Norte, Pierina and Veladero ceased effective March 31, 2018.
6) GEOs and SEOs, which are provided to assist the reader, are based on the following commodity price assumptions: $1,300 per ounce gold; $16.00 per ounce silver; and $1,350 per ounce palladium, consistent with those used in estimating the Company's production guidance for 2019. Previously, GEOs and SEOs were calculated by referencing the average LBMA price during the period. This revised methodology of calculating GEOs and SEOs has been applied to all periods presented.
7) Payable gold, silver and palladium ounces produced but not yet delivered (“PBND”) are based on management estimates. These figures may be updated in future periods as additional information is received.