August 20, 2024 1:39 PM EDT | Source: IMPACT Silver Corp.
Vancouver, British Columbia–(Newsfile Corp. – August 20, 2024) – IMPACT Silver Corp. (TSXV: IPT) (OTCQB: ISVLF) (FSE: IKL) (“IMPACT” or the “Company”) released its financial and operational results for the second quarter ended June 30, 2024.
The Company reported a total revenue of $7.7 million in Q2 2024, marking a substantial 40% increase over the $5.5 million revenue recorded in Q2 2023. Revenue in Q2 2024 includes $1.8 million from the Plomosas high-grade zinc mine, up from $1.0 million in Q1 2024. The Plomosas mine, acquired in April 2023, was made operational in late 2023, and hence, year-over-year comparisons do not include any revenue or operating costs from Q2 2023. Additionally, revenue at the Zacualpan silver-lead-zinc project rose to $5.9 million in Q2 2024 from $5.4 million in Q2 2023, despite lower production on a year-over-year basis, attributed mainly to stronger silver prices.
In Q2 2024, the mine operating loss (before amortization and depletion) was $0.2 million compared to a profit of $0.9 million in Q2 2023, which did not account for any start-up and operating costs from Plomosas. Cost pressures at mine sites, certain one-time costs related to initiating the Plomosas mine, and the unfavorable impact of a strong Mexican Peso contributed to the net loss of $2.6 million in Q2 2024 compared to a net loss of $0.9 million in Q2 2023.
Key Highlights of Q2 2024 Financials:
- Total revenue increased to $7.7 million from $5.5 million in Q2 2023.
- Mine operating loss before amortization and depletion in Q2 2024 was $0.22 million compared to a profit of $0.9 million in Q2 2023.
- Net loss in Q2 2024 was $2.6 million, inclusive of foreign exchange expense and deferred income taxes, compared to a net loss of $0.9 million in Q2 2023.
- After investing $1.6 million in exploration expenditures and mining assets during the quarter, the Company ended the quarter with a strong cash position of $9.9 million and working capital of $8.8 million.
- The quarter saw the close of a non-brokered “LIFE” and private placement of $8.6 million.
- The Company carries no long-term debt.
Operational Highlights of Q2 2024 at Zacualpan Mine:
- Mill throughput in Q2 2024 stood at 35,062 tonnes, slightly lower than 35,753 tonnes in Q2 2023.
- Silver production decreased by 2% to 152,152 oz in Q2 2024 compared to 155,744 oz in Q2 2023, while lead and gold production fell by 36% and 69%, respectively, on a year-over-year basis.
- Revenue per tonne sold was $168.17 in Q2 2024, up 8% from $155.67 in Q2 2023.
- Direct costs per production tonne were $153.26 in Q2 2024, a 17% increase from $130.67 per tonne in Q2 2023, attributed to foreign exchange fluctuations, union labor settlements, bonuses, and inflation-related pressures in Mexico.
Review of Zacualpan Silver District:
The Company’s average mill head grade during the period decreased by 1% year-over-year. Gold production was temporarily reduced in comparison to the prior year, as the Company focused on improving mining efficiencies and recoveries at its gold-rich Alacran mine. Furthermore, ongoing geopolitical uncertainties, a flight to safety, and inflationary pressures have driven metal prices higher, positively impacting the Company’s revenue. However, cost inflation and the impact of a strong Mexican Peso have hampered profit margins. The Company expects cost pressures to lessen in the second half of 2024 as new labor contracts provide cost certainty and operational adjustments are made to enhance throughput grade.
Operational Highlights of Q2 2024 at Plomosas Mine:
- The Plomosas high-grade zinc mine, acquired in April 2023, continued its production ramp-up.
- Mill throughput in Q2 2024 increased to 9,256 tonnes, a 157% rise from 3,594 tonnes in Q1 2024.
- Average zinc grade since the beginning of 2024 was 14%, lead was 8.7%, and silver was 43.7 g/t.
- Exploration activities continued, with 14,377 meters drilled in the last six months to support ongoing and future production.
- Production at the start of Q2 2024 was approximately 100 tpd, a significant improvement from the previous year.
- Despite ongoing costs related to site improvements and mine development, costs at Plomosas remained stable over the first six months of 2024, resulting in a $0.2 million cost decrease in Q2 2024 compared to Q1 2024.
Review of Plomosas High-Grade Zinc Mine:
Following the acquisition in April 2023, the Company focused on rehabilitating the Plomosas mine, plant, and equipment, with limited start-up operations beginning late in 2023. During Q2 2024, the Company accelerated the production ramp-up at Plomosas, aiming to reach design capacity levels by late 2024 or early 2025. This ramp-up is expected to positively impact financial results, enhancing overall revenue and reducing per tonne operating costs.
Outlook:
IMPACT Silver Corp. remains well-positioned with a strong balance sheet to improve efficiencies at the Zacualpan operation and increase production levels at the Plomosas zinc mine. Management anticipates a shift towards higher grade mine development at Zacualpan, leveraging recent exploration outcomes. Meanwhile, exploration activities at Plomosas are ongoing, with the expectation of continuous revenue growth. Cost pressures are expected to subside as operational adjustments are made heading into 2025.
The Company’s recent success in exploration at Zacualpan and production growth at Plomosas underscores its unique position as an intermediate miner offering exposure to various facets of the mining sector, including exploration, production, and overall growth.
A recorded conference call discussing the financial and production results for the quarter ended June 30, 2024 will be available on the Company website on August 21st, 2024 at https://impactsilver.com/media/conference-calls/.
This information should be read alongside the Company’s unaudited condensed consolidated interim financial statements and Management’s Discussion and Analysis, accessible on the Company website at www.impactsilver.com and on SEDAR at www.sedarplus.ca. All amounts are in Canadian dollars unless stated otherwise.
About IMPACT SILVER:
IMPACT Silver Corp. (TSXV: IPT) is an intermediate mineral producer and explorer with three mining projects in Mexico.
Royal Mines of Zacualpan Silver-Gold District: The Zacualpan project spans 211 km² in central Mexico and comprises four underground silver mines and one open pit mine feeding the Guadalupe processing plant. The Capire Project in the southern region includes a 200 tpd processing pilot plant next to an open pit silver mine with an NI 43-101 inferred mineral resource of over 4.5 million oz silver, 48 million lbs zinc, and 21 million lbs lead. Over the years, IMPACT has developed multiple exploration zones into commercial production, generating over 12 million ounces of silver and revenue exceeding $271 million, without long-term debt.
Plomosas Zinc-Lead-Silver District: Plomosas is a high-grade zinc producer in northern Mexico with significant exploration potential. The Company has recently restarted mining operations and aims to achieve design capacity in the next few months. Exploration opportunities at Plomosas are vast, with only 600m of the 6 km-long structure having undergone modern exploration. Regional exploration at the 3,019-hectare property includes untested copper-gold targets showing indications of high-grade material. Plomosas lies in a mineral belt known for substantial carbonate replacement deposits.
For more information on IMPACT Silver and its operations, visit the Company website at www.impactsilver.com. Follow IMPACT Silver on Twitter @IMPACT_Silver and on LinkedIn at https://www.linkedin.com/company/impactsilver.
Qualified Person and NI 43-101 Disclosure:
George Gorzynski, P.Eng., VP Exploration and Director of IMPACT, is a “Qualified Person” under NI 43-101 and has approved the technical information provided in this news release.
On behalf of IMPACT Silver Corp.
“Frederick W. Davidson”
President & CEO
Neither TSX Venture Exchange nor its Regulation Services Provider accepts any responsibility for the adequacy or accuracy of this release.
Forward-Looking and Cautionary Statements
This IMPACT News Release may contain certain forward-looking statements and information that reflect the beliefs of IMPACT management and are based on available information. Forward-looking information may include statements concerning ramp-up of operations, improved operating revenues, and decreasing costs.
Forward-looking information entails known and unknown risks and assumptions, and should any risks materialize, actual results may vary from the statements provided herein. IMPACT is not obligated to update any forward-looking statements, except as required by law.
The Company’s decision-making regarding mining operations is based on internal data and reports by the Company’s geologists and engineers. Historic operations have been successful, evident from commercial production and financial success since 2006. The Company has not based its production decisions on NI 43-101 compliant mineral resource or reserve estimates, preliminary economic assessments, or feasibility studies.
303-543 Granville Street
Telephone 604 664-7707
Vancouver, BC, Canada V6C 1X8
www.impactsilver.com
X (Twitter)
[1] Mine operating earnings before amortization and depletion is a non-IFRS measure which provides meaningful information about the Company’s financial performance. See “Non-IFRS MEASURES”.
To view the original version of this press release, please visit https://www.newsfilecorp.com/release/220576
