TORONTO (miningweekly.com) – Mexico-focused miner Endeavour Silver has reported lower net earnings for the first quarter as lower output, prices and higher costs offset gains in currency fluctuations.

For the three months ended March 31, the NYSE- and TSX-listed company, which operates the Guanaceví mine, in Durango state, and the Bolañitos and El Cubo mines, in Guanajuato state, reported net earnings of $1.4-million, down from $4-million in the comparable period a year earlier.

Endeavour on Wednesday said it had generated revenue of $51.1-million, down slightly compared with $53-million for the same period a year earlier.

The company sold 1.86-million ounces of silver and 15 799 oz of gold ounces at realised prices of $17.11/oz and $1 221/oz, respectively, compared with sales of 1.54-million ounces of silver and 16 445 oz of gold at realised prices of $20.50/oz and $1 306/oz in the comparable period.

After cost of sales of $42-million, up slightly over the same period last year, mine operating earnings were $9.1-million, lower than the $11.3-million reported a year earlier from mining and milling operations in Mexico. Excluding depreciation and depletion of $10.5-million and stock-based compensation of $100 000, mine operating cash flow before taxes was $19.6-million.

Compared with the first quarter last year, the Mexican peso had depreciated 11% against the US dollar, helping offset the weakness in precious metal prices. About 65% of endeavour’s operating costs were expressed in Mexican pesos.

The falling peso and continued focus on cost reductions had lowered the consolidated operating cost 11% to $82.67/t in the first quarter. Lower gold grades resulted in rising cash costs an ounce net of by-product credits, which increased 47% to $7.17/oz of payable silver compared with $4.87/oz in the same period of 2014.

Similarly, the lower gold grades offset by lower exploration and development expenditures resulted in all-in-sustaining costs an ounce increasing 10% to $13.32.

Endeavour in March revised its silver production estimate upwards for 2015 by 11% to a range of 6.3-million and 7-million ounces. Gold output rose by 27% to between 60 000 oz and 66 000 oz, and silver equivalent production was now forecast to be about 10.4-million to 11.6-million ounces at a 70:1 silver-to-gold ratio.