Sierra Metals Inc. - President and CEO, Igor Gonzales
President and CEO, Igor Gonzales
Source: Globe and Mail
  • Sierra Metals (TSX:SMT) has reported strong production results for silver, copper, lead, zinc and gold in the first quarter of 2020
  • All metals saw an increase of at least 30 per cent over the first quarter of 2019, with gold production up by 84 per cent
  • The positive results come even in the face of disruptions at the Yauricocha mine, after the Peruvian government implemented a state of emergency to contain the spread of COVID-19
  • Sierra’s Bolivar mine in Mexico reported a record quarterly throughput of 4,315 tonnes per day
  • Sierra Metals (SMT) is currently steady at C$1.08 per share, with a market cap of $175.38 million

Sierra Metals (TSX:SMT) has reported strong production results for silver, copper, lead, zinc and gold in the first quarter of 2020.

The company is currently focused on its three underground mines in Latin America: the Yauricocha mine in Peru, and the Bolivar and Cusi mines in Mexico.

With the global outbreak of COVID-19, many mining companies have struggled with government-mandated shutdowns affecting operations.

However, despite this, total production from Sierra’s mines for the first three months of 2020 saw a significant improvement over the same period last year.

Silver, lead and zinc were up 37 per cent, 31 per cent and 32 per cent, respectively. Copper was up 52 per cent to 11.8 million pounds, and gold was up 84 per cent to 3,657 ounces.

Sierra says that the improved results came from continued investments and operational improvements at all its sites. This, in turn, resulted in increased throughput and higher recoveries.

Igor Gonzales, President and CEO of Sierra Metals, noted that production results have been improving each quarter since the beginning of 2019, due in part to completed expansions and ramped-up operations in Mexico.

“We also ran the Yauricocha Mine at higher throughput levels to catch up from a strike in 2019 and in Q1 2020 to build up processed tonnage as a buffer against any potential interruptions,” he said.

Separately, and as a result of work stoppages at all of Sierra’s mines brought on by COVID-19, the company will be withdrawing its 2020 production and cost guidance.

“We expect to be able to ramp up quickly to pre-pandemic levels once the state of emergency is withdrawn in Peru and Mexico.

“We have a strong balance sheet and we have reduced and deferred capital expenditures to ensure we emerge as strong a company as before the pandemic,” Igor said.

Sierra Metals (SMT) is currently steady and trading at C$1.08 per share, as of 9:56am EST.

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