On November 7, Fortuna Silver Mines Inc (NYSE:FSM), a Vancouver, Canada-based silver producer with properties in Mexico and Argentina, reported a 75% jump in revenue, and 353% in net income in the third quarter of 2016.
Revenue at Fortuna Silver Mines in the third quarter of 2016 was $65.2 million. Net income was $11.8 million or $0.09 per share. In the same period year ago, the silver miner’s revenue was $39.0 million and its net income was $2.6 million, or $0.02 per share.
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Looking at the operations, Fortuna Silver Mines showed stellar performance.
In the third quarter, Fortuna Silver Mines produced, 2.09 million ounces of silver and 14,111 ounces of gold. In the same period a year ago, its silver production was 1.73 million ounces and gold production was 10,963 ounces. This represents a 20.8% increase in silver production and a jump of 28.71% in gold production.
The company’s costs to produce an ounce of silver plunged significantly as well. In the third quarter, Fortuna Silver Mines’ all-in sustaining cash costs were $7.60 per ounce. In the same period a year ago, this was $13.80 an ounce. This represents a decline of 45%.
How did the company achieve this sort of performance? President and CEO Jorge A. Ganoza said, “Our strong results for the reporting period reflect the positive impact of our first quarter at the expanded processing capacity of 3,000 tpd at the San Jose Mine, higher silver and gold prices, and excellent cost execution at both operations. Our business generated a robust cash flow from operations of $28.5 million.” (Source: “Fortuna reports consolidated financial results for the third quarter 2016,” Fortuna Silver Mines Inc, November 7, 2016.)
Fortuna Silver Mines generated $28.5 million from operating activities. In the same period a year ago, it was $17.9 million. It ended the quarter with cash and cash equivalents of $103.20.
At the time of writing, Fortuna Silver Mines’ stock was trading at $6.80, down 1.59% from the previous close. In August, FSM stock traded as high as $9.75—its 52-weeks high.
