- Fortuna Silver (TSX:FVI) achieved record earnings in Q3 2024
- For Q3 2024, Fortuna reported an attributable net income of US$50.5 million, a notable increase from US$40.6 million in the previous quarter
- The Vancouver-based precious metals explorer produced 110,820 ounces of gold equivalent during the quarter, slightly down from 116,570 ounces in Q2
- Fortuna Silver Mines stock (TSX:FVI) last traded at C$6.47
Fortuna Silver (TSX:FVI) achieved record earnings in Q3 2024, which the company points to strong operational performance and growth initiatives as the keys to its success.
For the quarter, Fortuna reported an attributable net income of US$50.5 million, or $0.16 per share, an increase from US$40.6 million or $0.13 per share in the previous quarter. The adjusted attributable net income also rose to US$49.9 million, maintaining the same per-share value, compared to US$30.4 million or $0.10 per share in Q2 2024.
The Vancouver-based precious metals explorer generated US$119.3 million in cash flow from operations before working capital changes, equating to $0.38 per share. Free cash flow from ongoing operations reached US$56.6 million, up from US$38.6 million in Q2. As of the end of the quarter, Fortuna’s cash position stood at US$180.6 million, with a positive net cash position of US$8.0 million. Liquidity increased significantly to US$430.6 million, up from US$355.6 million at the end of Q2.
In a strategic move to enhance financial flexibility, Fortuna resized its revolving credit facility from US$250 million to US$150 million and increased the uncommitted accordion to US$75 million from US$50 million, reducing reliance on bank debt. Notably, the revolving debt facility remains fully undrawn.
Operational highlights
On the operational front, Fortuna produced 110,820 ounces of gold equivalent during the quarter, slightly down from 116,570 ounces in Q2. For the first nine months of 2024, the company has produced 339,933 ounces, aligning well with its annual guidance of 457,000 to 497,000 ounces.
Consolidated cash costs per ounce of gold equivalent sold were reported at US$1,059 for the quarter and US$977 year-to-date, remaining consistent with annual guidance of US$935 to US$1,055. Adjusting for the San Jose mine, which is in its final year of mineral reserves, consolidated cash costs were US$935 for the quarter.
The consolidated all-in sustaining cash costs (AISC) per ounce of gold equivalent sold were US$1,696 for the quarter and US$1,618 year-to-date, tracking at the upper end of the annual guidance of US$1,485 to US$1,640. The ongoing leach-pad expansion project at the Lindero mine, a one-time capital investment of US$42 million, is set for completion in Q4 and is expected to impact annual consolidated AISC by approximately US$90 per ounce.
Growth and exploration initiatives
Fortuna continues to focus on growth and exploration, with promising developments at the newly discovered Kingfisher prospect at the Séguéla Mine, where the company intersected 14.2 g/t gold over 16.8 metres. Additionally, exploration efforts at the Diamba Sud project yielded an intersection of 6.9 g/t gold over 33.3 metres at the Western Splay prospect.
“In Q3, a focus on cost discipline and safe operations allowed Fortuna to capture the benefit of rising metal prices and achieve record attributable earnings” Jorge Ganoza, Fortuna’s president and CEO said in a news release. “The company also achieved a key milestone with a positive net cash position at the end of the quarter and we recently renegotiated our credit facility reducing financial costs and providing additional financial flexibility.”
Fortuna Silver Mining Corp. is a Canadian precious metals mining company with four operating mines in Argentina, Burkina Faso, Mexico, and Peru, and a fifth in Côte d’Ivoire.
Fortuna Silver Mining stock (TSX:FVI) last traded at C$6.47 and has risen 26.86 per cent since the beginning of the year.
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(Top image via Fortuna Silver Mining Corp.)
