Silvercorp’s shares declined 0.9% following Q1 results as investors digested the impact of significant production declines in key metals and the temporary suspension of operations for safety upgrades, which cloud near-term output despite stable margins and strong metal prices.
- Revenue increased 70% year-over-year to $139 million, driven by a 135% rise in realized silver prices, averaging above $69/oz after smelter deductions.
- Net income for the quarter was $59.4 million ($0.27 per share), including $17 million of gains from investments and asset sales; adjusted net income was $53.9 million ($0.24 per share), up from $21 million ($0.10) a year ago.
- Production fell noticeably: silver down 17%, lead and zinc each down 15%, while gold production increased 24%. The declines reflect lower head grades and dilution effects, as well as the temporary halt in Chinese operations to implement mandated safety upgrades.
- Operating costs increased modestly, with Ying’s production costs rising 5% year-over-year due to RMB depreciation; cash costs per silver ounce nearly doubled to $2.45 from $1.26, in part owing to lower silver volumes sold and higher government taxes.
- Capital expenditures focused on mine development projects across China and Ecuador, including the construction of a third mill and ongoing work at the El Domo project, with full production impact expected in future quarters.
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