Fortuna Silver Mines Inc (FSM)

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Fortuna Reports First Quarter 2021 Financial Results
May 10, 2021 7:11 AM ETGlobeNewswireFortuna Silver Mines Inc. (FSM)

Q1: 2021-05-10 Earnings Summary
EPS of $0.14 beats by $0.05 | Revenue of $117.80M (148.00% Y/Y) misses by $500.00K

(All amounts expressed in US dollars, tabular amounts in millions, unless otherwise stated)

VANCOUVER, British Columbia, May 10, 2021 (GLOBE NEWSWIRE) -- Fortuna Silver Mines Inc. (FSM) (TSX: FVI) (“Fortuna” or the “Company”) today reported record first quarter 2021 net income of $26.4 million, adjusted net income1 of $27.5 million, and adjusted EBITDA1 of $60.8 million.

Jorge A. Ganoza, President and CEO, commented, “Our record financial performance in the first quarter reflects the combination of strong operating performance at San Jose and Caylloma, Lindero's first full quarter of contribution to sales, and favourable metal prices." Mr. Ganoza added, “As Lindero continues to ramp up we are pleased with the progress made in Q1 considering the challenges we continue to face in the context of COVID-19 related restrictions. We remain on track to meet our consolidated guidance of 178,000 to 202,000 ounces of gold and 6.8 million to 7.6 million ounces of silver.”

First Quarter 2021 Highlights

Record sales of $117.8 million, an increase of 148% from the $47.5 million reported in the same period in 2020 (“Q1 2020”), due to higher realized prices and sales volumes for all metals at all mines, notably sales from the Lindero Mine of $36.9 million

Record net income of $26.4 million or $0.14 per share, an increase of $30.9 million and $0.17 per share, from the $4.5 million net loss or $0.03 loss per share reported in Q1 2020

Record adjusted net income1 of $27.5 million compared to $2.2 million net loss in Q1 2020

Record adjusted EBITDA1 of $60.8 million compared to $15.9 million reported in Q1 2020

Free cash flow from ongoing operations1 of $17.4 million compared to $14.2 million reported in Q1 2020, the current quarter was impacted by a $16.2 million increase in trade receivables due to timing of collections

As of March 31, 2021, the Company had cash and cash equivalents of $145.7 million, an increase of $13.8 million from December 31, 2020

Silver and gold production of 1,913,755 ounces and 34,355 ounces, respectively

AISC1,2 per silver equivalent ounce of payable silver sold of $13.52 and $18.50 for the San Jose Mine and Caylloma Mine, respectively, and AISC1 per ounce of gold sold of $1,055 for the Lindero Mine

Announced a business combination transaction with Roxgold Inc. on April 26, 2021: creates a low-cost intermediate global precious metals producer with extensive brownfields and greenfields organic growth potential and led by highly experienced management

First Quarter 2021 Results

Sales for the three months ended March 31, 2021 were $117.8 million, an increase of 148% from the $47.5 million reported in Q1 2020. Silver and gold prices increased 61% and 12%, respectively. The Lindero Mine recognized sales of $36.9 million from 21,297 ounces of gold ounces sold. San Jose sales were $58.0 million, an increase of 50% from the $38.7 million reported in Q1 2020 due to increases in the prices of silver and gold and a 3% and 5% increase in the volume of silver and gold ounces sold, respectively. Sales from the Caylloma Mine were $25.4 million, a 92% increase from the $13.2 million reported in Q1 2020 due to higher metal prices and a 22%, 17%, and 21% increase in the volume of silver, zinc, and lead sold, respectively.

Operating income for the three months ended March 31, 2021 was $40.4 million, an increase of $38.6 million compared to Q1 2020. The increase was due primarily to higher silver and gold prices, and Lindero’s contribution to mine operating income of $11.7 million.

Net income for the three months ended March 31, 2021 was $26.4 million, a $30.9 million increase over the $4.5 million net loss reported in Q1 2020. The effective tax rate for the quarter was 34%.

Adjusted EBITDA for the three months ended March 31, 2021 was $60.8 million, an increase of $44.9 million compared to $15.9 million reported in Q1 2020. The increase reflects Lindero's contribution to adjusted EBITDA of $19.6 million as well as higher EBITDA at San Jose and Caylloma.

Free cash flow from ongoing operations for the three months ended March 31, 2021 was $17.4 million compared to $14.2 million in Q1 2020. Free cash flow was impacted by a $16.2 million increase in trade receivables during the quarter, due primarily to timing of collections on provisional sales.

As of March 31, 2021, the Company had cash and cash equivalents of $145.7 million, an increase of $13.8 million from December 31, 2020. The Company’s $120.0 million credit facility remains fully drawn as of March 31, 2021 and is set to expire on January 26, 2022. The Company expects to conclude renewal of the facility in the second quarter of 2021.

https://seekingalpha.com/pr/18309019-fortuna-reports-first-quarter-2021-financial-results