TORONTO (miningweekly.com) – The world’s largest precious metals streaming company Silver Wheaton on Friday said it had lifted fourth-quarter profit by 23% to $177.7-million or 50c a share, compared with net earnings of $144.7 or 41c a share in the same quarter a year earlier, as a result of increased silver and gold production.

Attributable silver-equivalent production for the period ended December 31 rose by 22% to a record 8.5-million ounces, comprising seven-million ounces of silver and 26 400 oz of gold.

Average cash costs in the fourth quarter were $4.70 per silver-equivalent ounce, compared with $4.06 during the comparable period of 2011. This resulted in cash operating margins of $26.76 per silver-equivalent ounce, a 5% decrease when compared with the fourth quarter of 2011.

The company said the slightly lower margins were mainly a result of the higher production payments associated with the precious metals stream on Hudbay's 777 mine.

Revenue in the quarter was 50% higher year-on-year at $287.2-million, derived from silver-equivalent sales of 9.1-million ounces, made up of 7.3-million ounces of silver and 33 000 oz of gold.

For the full year, Silver Wheaton recorded a 7% increase in net earnings to $586-million or $1.66 a share, compared with net earnings of $550-million or $1.56 a share for the same period in 2011, an increase of 7%.

The company said it had recorded its fourth year of record yearly attributable production of 29.6-million silver equivalent ounces, comprised of 26.9-million ounces of silver and 50 000 oz of gold, a 17% increase when compared to 2011.

The average cash costs for the year ended were $4.30 a silver-equivalent ounce, compared with $4.09 during the comparable period of 2011. This resulted in cash operating margins of $26.79 per silver-equivalent ounce, a 12% decrease compared with 2011, which was mainly owing to a 10% decrease in the average realised silver price, at $31.03/oz.

Full-year revenue was 16% higher year-on-year at $849.6-million, derived from silver-equivalent sales of 27.3-million ounces that comprised 24.8-million ounces of silver and 46 100 oz of gold. The increased revenue was mainly owing to a 30% increase in the number of ounces sold and a 6% increase in the average realised gold price, which was partially offset by the decrease in the average realised price of silver.

CEO Randy Smallwood on Friday told an analyst conference call 2012 was an exceptional year for the company, and 2013 was shaping up to be even more extraordinary.

“We’ve been extremely busy evaluating new transactions. The market has never been better for accretive deals,” he said.

During the third quarter of 2012, Silver Wheaton acquired a precious metals stream from Hudbay Minerals' currently producing flagship 777 mine, as well as a silver stream from Hudbay’s $1.5-billion Constancia copper mine, currently under construction in Peru.

Subsequent to the 2012 year-end, Silver Wheaton also acquired 25% of the gold from major miner Vale's Salobo mine, in Brazil, for the life of the mine and 70% of the gold from certain of its Sudbury operations for a 20-year period, with both these agreements effective as of January 1.

Smallwood said the company had about $1-billion in financial capacity for new deals, having raised $2.5-billion after the Vale transaction, to give it extra capacity.

The company expected to boost its attributable growth profile by 80% over 5 years to 53-million silver-equivalent ounces in 2017.

This year, the company expected to produce 33.5-million silver-equivalent ounces.

The firm, which provided miners with cash up front to finance mine construction in exchange for the right to buy future precious-metals production at a set price, on Tuesday said it had pushed up its attributable proven and probable reserves by more than 38% in 2012, to a record total of 1.12-billion.

The company’s attributable reserves comprised 851.4-million ounces of silver and 4.96-million ounces of gold.

Over the same period, attributable measured and indicated resources increased 28% to a record total of 603.2-million silver-equivalent ounces, consisting of 529.1-million ounces of silver and 1.39-million ounces of gold.

The company’s TSX-listed shares rose by 2.11% on Friday to C$32.36 apiece. The company’s shares had declined in value by 13.30% from the start of the year.