FSM - Fortuna Silver sinks to nine-month low after Q2 earnings miss

2023-08-10 12:57:26 ET

Fortuna Silver Mines ( NYSE: FSM ) -9.9% in Thursday's trading after reporting Q2 adjusted earnings that missed estimates as production fell and costs rose.

Q2 net income rose to $3.5M from $1.7M in the year-ago quarter, but adjusted EBITDA fell 23% to $44.4M from $57.9M and revenues slipped 6% to $158.4M from $167.9M in the prior-year period, due mainly to lower volume of metal sold at the San Jose mine because of the 15-day work stoppage related to an illegal blockade at the mine, and lower volume at Lindero related to the mine sequence.

Q2 gold equivalent production was 93,454 oz, including gold output of 64,348 oz and silver output of 1.26M oz; all-in sustaining cost rose 25% Y/Y to $1,799 per gold equivalent oz from $1,434/oz a year earlier.

Fortuna ( FSM ) said it produced more than 4K oz at the Seguela mine in Côte d’Ivoire in the days prior to the end of Q2, but the first gold sale did not occur until early in Q3.

"With Seguela contributing its first full quarter of production in the third quarter, the return of normal to operations at San Jose, Yaramoko continuing to perform above expectations, and the completion of a stripping phase in the second quarter at Lindero, we expect growing margins and free cash flow to improve in the third and fourth quarter of the year," President and CEO Jorge Ganoza said.

More on Fortuna Silver Mines:

• Financial and valuation comparison to sector peers
• Analysis: Fortuna Silver: Seguela Mine Begins Contributing On Schedule
• Stock price return: Down 13% YTD, up 4.5% in the past 12 months

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