EXK - Endeavour Silver (EXK) - Higher Commodity Prices Expected to Benefit 2H Performance

Second quarter production results. Compared to the prior year period, second quarter silver and gold production declined 43.7% and 39.1% to 596,545 ounces and 5,817 ounces, respectively. Sequentially, silver and gold production declined 30.4% and 31.4%, respectively. Second quarter production was negatively impacted by the temporary suspension of mining operations in Mexico due government-mandated work restrictions. Mining operations resumed in late May. The bright spot for the quarter was the improvement at the Guanacevi mine as a result of access to new higher grade ore bodies. We expect improvement at the Bolanitos mine beginning in the third quarter.Updating estimates. We have narrowed our 2020 loss per share estimate to $(0.14) from $(0.15) based on higher gold and silver prices. Additionally, we have increased our 2021 EPS estimate to $0.11 from $0.07. We forecast 2020 and 2021 EBITDA of $12.1 million and $57.8 million, respectively. While management had expected to release an updated preliminary feasibility study for the Terronera mine project in June, news on this is expected shortly.Second quarter earnings date. EXK will release second quarter 2020 financial results and updated 2020 production and cost guidance before the market open on August 6, 2020. Management will host a conference call for investors on the same day at 1:00 pm ET.Rating is Market Perform. We would like to see continued improvement at the company's operations and greater visibility with respect to long-term growth drivers, including the company's Terronera mine project. The company's second quarter earnings report and updated production and cost guidance should help to gauge the company's progress in lowering its operating costs.Read More >>