Photo by: Bloomberg
TORONTO (miningweekly.com) – The world’s largest precious metals streaming firm Silver Wheaton reported weaker second-quarter earnings, on Wednesday after market close, as lower precious metals prices impacted the bottom line.
For the three months ended June 30, the NYSE- and TSX-listed firm reported earnings of $63.5-million, or $0.18 a share, down 11% compared with $71.1-million, or $0.20 a share, a year earlier.
This was below average Wall Street analyst expectations of $0.24 a share on revenues of $148.57-million.
Revenue declined 11% year-on-year to $148.6-million in the period on silver equivalent sales of 7.5-million ounces, comprising 5.2-million ounces of silver and 34 800 oz of gold. This represented an 11% decrease from the $166.9-million in the second quarter of 2013, mainly owing to a 14% decrease in the average realised silver equivalent price of $19.83/oz compared with $23.05/oz a year earlier. This was partially offset by a 4% rise in the number of silver equivalent ounces sold at 7.2-million ounces.
Silver Wheaton reported cash costs of $4.72 a silver equivalent ounce, down from $4.77/oz in the second quarter a year earlier. Gold sales accounted for about 30% of its sales and the company realised a gold price of $1 295/oz.
During the quarter, Silver Wheaton reported attributable silver equivalent output of 8.4-million ounces, comprising 6.3-million ounces of silver and 31 400 oz of gold, 4% lower year-over-year.
"Given the progress being made at our diversified portfolio of mines and projects, we believe that Silver Wheaton is on the cusp of seeing its next stage of growth realised, leaving it well-positioned to benefit from rebounding precious metal prices,” president and CEO Randy Smallwood said.
Based on its current agreements, Silver Wheaton expected 2014 full-year output of about 36-million silver equivalent ounces, including 155 000 oz of gold.
By 2018, its yearly output was expected to rise significantly to about 48-million silver equivalent ounces, including 250 000 oz of gold. This growth would be driven by the company’s portfolio of low-cost and long-life assets, including precious metal and gold streams on Hudbay’s Constancia project, in Peru, and Vale’s Salobo mine, in Brazil, and Sudbury mine, in Ontario.
Silver Wheaton’s NYSE-listed stock on Thursday trended lower, hovering near the $26-a-share mark. The stock had gained 28% since the start of the year.