Endeavour Silver reports Q1 net earnings

Endeavour Silver recorded positive net earnings for the first quarter, helped by lower costs at its El Cubo mine in Mexico.

The Canadian miner reported net earnings of US$1.36mn for the period, down from US$4.04mn in 1Q14, as revenue declined 4% to US$51.1mn.

Silver and gold production dropped 4% and 15%, respectively, to 1.82Moz and 15,808oz at the company's three Mexican mines.

Revenue was also impacted by 17% lower realized silver prices and 7% lower gold prices. All-in sustaining costs (AISCs) rose 10% to US$13.32/oz silver, net of gold credits, from US$12.15/oz.

QUARTER-ON-QUARTER IMPROVEMENTS

AISCs were down from US$15.37/oz in Q4, mainly because of improvements at El Cubo, which saw AISCs dip to US$26.44/oz from US$35.04/oz.

Endeavour has begun a US$3.8mn expansion to 2,200t/d throughput from 1,550t/d at the Guanajuato state mine in a bid to lower the mine's costs, increase production and generate free cash flow.

Ore from El Cubo will be processed at the Bolañitos plant, with the Bolañitos mine currently in the process of ramping down to 1,200t/d from 1,600t/d throughput.

COST FOCUS

Endeavour remains focused on cost improvements at its operations, CEO Bradford Cooke said during an earnings call.

AISCs at El Cubo are likely to increase in this quarter because of expansion spending, with Q3 expected to give an idea of steady state operations at all three mines, he added.

The company is also considering potential acquisitions in Latin America, Cooke told BNamericas in March. Endeavour also has the Guanaceví mine and the Terronera silver-gold project, formerly known as San Sebastián, in Mexico.

Pictured: Endeavour CEO Bradford Cooke.