Silvercorp Reports Q1 Results: Net Income up 73%, Cash Flows From Operations up 52% to US$20.2 Million
VANCOUVER, Aug. 11, 2016 /CNW/ - Silvercorp Metals Inc. ("Silvercorp" or the "Company") (TSX: SVM) reported its financial and operating results for the first quarter ended June 30, 2016 ("Q1 Fiscal 2017"). All amounts are expressed in US Dollars. FIRST QUARTER HIGHLIGHTS - Net income attributable to equity shareholders of $4.7 million, or $0.03 per share compared with net earnings attributable to equity shareholders of $2.3 million or $0.01 per share in the prior year period;
- Silver, lead and zinc sales up 20%, 12% and 15%, respectively, from the prior year period to 1.6 million ounces silver, 16.7 million pounds lead and 5.2 million pounds zinc;
- Sales of $35.3 million, up 9% from the prior year period despite a 3%, 13%, and 17% decline in the average selling price of silver, lead and zinc from prior year period;
- A 23%, 21% and 22% increase in the head grades of silver, lead and zinc;
- Gross margin improved to 45% from 36% in the prior year period;
- Cash flows from operations of $20.2 million, up 52% from the prior year period;
- Cash production cost per tonne1 of $61.65 compared with $71.01 in the prior year period;
- Cash cost per ounce of silver1, net of by-product credits, of $0.08, compared to $1.39 in the prior year period;
- All-in sustaining cost per ounce of silver1, net of by-product credits, of $7.06, compared to $10.94 in the prior year quarter; and
- Ended the period with $73.4 million in cash and short term investments, an increase of $11.4 million compared to $62.0 million as at March 31, 2016.
_________________________ 1 Non-IFRS measure, see section 9 of the corresponding management's discussion and analysis for reconciliation |
FINANCIALS Net income attributable to the shareholders of the Company in Q1 Fiscal 2017 was $4.7 million, or $0.03 per share compared to $2.3 million, or $0.01 per share in Q1 Fiscal 2016. In the current quarter, the Company's financial results were mainly impacted by the following: (i) improved head grades yielded higher silver, lead, zinc sales of 20%, 12% and 15%, respectively; (ii) a 4% decrease in total production costs per tonne of ore processed; offset by (iii) the decline of metals prices, as the realized selling price for silver, lead, and zinc decreased by 3%, 13% and 17%, respectively, compared to the same prior year quarter. Sales in Q1 Fiscal 2017 were $35.3 million compared to $32.2 million in Q1 Fiscal 2016. Silver and gold sales represented $20.8 million and $0.9 million, respectively, while base metals represented $13.6 million of total sales in this quarter compared to silver, gold and base metals of $17.9 million, $0.7 million, and $13.6 million, respectively, in Q1 Fiscal 2016. Cost of sales in Q1 Fiscal 2017 was $19.5 million compared to $20.8 million in Q1 Fiscal 2016. The cost of sales included $14.6 million (Q1 Fiscal 2016 - $16.2 million) cash costs and $5.0 million (Q1 Fiscal 2016 - $4.6 million) depreciation, amortization and depletion charges. The decrease of cash cost of sales was mainly due to a 13% decrease in cash production costs per tonne of ore processed. The total per tonne ore production cost in Fiscal Q1 2017 was $85.58, a decrease of 4%, from $88.82 in Q1 Fiscal 2016. Gross profit margin in Q1 Fiscal 2017 was 45% compared to 36% in Q1 Fiscal 2016. The improvement of gross profit margin was mainly due to the decrease of per tonne ore production costs. Ying Mining District's gross profit margin was 49% compared to a 41% gross profit margin in the same prior year quarter, while GC Mine's profit margin was 17% compared to a 9% gross profit margin in Q1 Fiscal 2016. Cash flows provided by operating activities were $20.2 million or $0.12 per share in Q1 Fiscal 2017 compared to $13.3 million or $0.08 per share in Q1 Fiscal 2016. Before changes in non-cash operating working capital, cash flows provided by operating activities were $15.5 million, an increase of $6.5 million, compared to $9.0 million in Q1 Fiscal 2016 as a result of the improvement of operating earnings.
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