Sierra Metals (SMTS) Q3 2024 earnings summary

Executive summary

• Q3 2024 saw strong operational and financial performance, with Yauricocha and Bolívar mines exceeding expectations and positioning to surpass annual production guidance.

• Throughput reached 669 kt (7,641 tpd), copper equivalent production was 20.9 Mlbs, and both mines delivered higher metal output.

• Divestment of the Cusi Mine generated $2.1 million in net profits, reduced costs, and allowed focus on core assets.

• Focused on safety, risk management, and sustainable mining, with significant training and leadership initiatives completed.

• Community engagement initiatives in health, education, and entrepreneurship continued in Mexico and Peru.

Financial highlights

• Q3 2024 net revenues reached $70.9 million, up 23% from Q2 2024 and 25% year-over-year, marking the highest quarter in over three years.

• Adjusted EBITDA was $20.4 million, a 152% increase year-over-year and 57% higher than Q2 2024; year-to-date adjusted EBITDA rose to $51 million.

• Net income attributable to shareholders was $3.8 million, reversing a net loss of $9.3 million in Q3 2023.

• Cash flow from operations was $22.1 million, a 48% increase over Q2 2024 and significantly higher than the $6 million in Q3 2023.

• Cash and cash equivalents stood at $18.6 million as of September 30, 2024.

Outlook and guidance

• Expects to exceed 2024 consolidated production guidance, with both Yauricocha and Bolívar tracking above targets.

• Yauricocha mine scheduled to reach full production capacity of 3,600 tpd in Q4 2024.

• Bolívar’s tailings facility expansion is planned to support future throughput increases.

• Cost guidance for 2024 is expected to be met, with cash costs and AISC within forecasted ranges.