REG - Wheaton Precious Met - Third Quarter Results for 2023
10/11/2023 07:00
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RNS Number : 0720T Wheaton Precious Metals Corp. 10 November 2023
November 9, 2023
Vancouver, British Columbia
Designated News Release
THIRD QUARTER FINANCIAL results
Wheaton Precious Metals Announces Solid Third Quarter Results for 2023
"The importance of having a diversified portfolio of high-quality, low-cost
assets was evidenced by Wheaton's ability to deliver solid operating results
in the quarter, despite the temporary suspension of one of our largest assets,
which has since begun the safe ramp-up of operations. Strong outperformances
from Salobo and Constancia, have not only offset challenges faced by others,
but also contributed significantly to our overall success. As such, we are
pleased to reiterate our annual production guidance range for 2023 of 600,000
to 660,000 gold equivalent ounces," said Randy Smallwood, President and Chief
Executive Officer of Wheaton Precious Metals. "In this high interest rate
environment, streaming continues to be one of the most competitive sources of
capital, and our corporate development team remains exceptionally busy
evaluating new opportunities. We remain resolutely committed to enhancing our
portfolio with growth that is accretive and sustainable, benefiting all
stakeholders."
Solid Financial Results and Strong Balance Sheet
· Third quarter of 2023: $223 million in revenue, $171 million in
operating cash flow, $116 million in net earnings and $121 million in adjusted
net earnings 1 (#_edn1) .
· A cash balance of $834 million and no debt as at September 30, 2023,
after making total upfront cash payments of $90 million relative to mineral
stream interests in the quarter.
· Undrawn $2 billion revolving credit facility maturing on June 22, 2028.
· Declared a quarterly dividend(1) of $0.15 per common share.
High Quality Asset Base
· Streaming agreements on 18 operating mines and 14 development projects.
· 93% of attributable production from assets in the lowest half of their
respective cost curves 2 (#_edn2) (, 3 (#_edn3) ).
· 30 years of mine life based on Proven and Probable Mineral Reserves and
potential additional mine life from mineral resource conversion and
exploration(2)(, 4 (#_edn4) ).
· Third quarter production increased quarter over quarter to 154,800 gold
equivalent ounces(3) ("GEOs"), driven by strong outperformances at both Salobo
and Constancia, and despite the temporary suspension at Peñasquito,
highlighting the strength of our diversified portfolio.
· Average annual production guidance for 2023 of 600,000 to 660,000
GEOs(2,3) is maintained, with sector-leading growth over the next five to ten
years.
· Accretive portfolio growth:
o Subsequent to the quarter, entered into a definitive agreement with
Waterton Copper Corp. to acquire a silver stream on the Mineral Park mine for
total cash consideration of $115 million.
o Acquired a 0.5% Net Smelter Royalty from Liberty Gold Corp., on the Black
Pine Oxide Gold Project for total cash consideration of $3.6 million, along
with an equity investment totalling $5 million in Liberty Gold at C$0.34 per
share.
Leadership in Sustainability
· Top Rankings: #1 out of 117 precious metals companies and ranked in the
Global Top 50 companies by Sustainalytics, AA rated by MSCI, and Prime rated
by ISS.
· Wheaton was recognized as Best Company for ESG & Sustainability
(Metals & Mining) and runner-up for Best Company for Climate Reporting
(Large Cap) by ESG Investing's Corporate ESG Awards.
Operational Overview
(all figures in US dollars unless otherwise noted) Q3 2023 Q3 2022 Change YTD 2023 YTD 2022 Change
Units produced
Gold ounces 105,436 72,078 46.3 % 261,635 216,574 20.8 %
Silver ounces 3,363 5,822 (42.2)% 12,876 18,497 (30.4)%
Palladium ounces 4,006 3,229 24.1 % 11,591 11,616 (0.2)%
Cobalt pounds 183 226 (19.1)% 458 596 (23.1)%
Gold equivalent ounces (3) 154,800 153,025 1.2 % 444,597 473,868 (6.2)%
Units sold
Gold ounces 74,426 62,000 20.0 % 212,325 224,238 (5.3)%
Silver ounces 2,965 5,234 (43.4)% 11,151 16,635 (33.0)%
Palladium ounces 4,242 4,227 0.4 % 10,580 11,680 (9.4)%
Cobalt pounds 198 115 72.2 % 786 851 (7.6)%
Gold equivalent ounces (3) 119,030 135,179 (11.9)% 375,248 460,026 (18.4)%
Change in PBND and Inventory
Gold equivalent ounces (3) 22,438 4,460 (17,978) 27,248 (32,368) (59,616)
Revenue $ 223,137 $ 218,836 2.0 % $ 702,573 $ 829,002 (15.3)%
Net earnings $ 116,371 $ 196,460 (40.8)% $ 369,209 $ 503,001 (26.6)%
Per share $ 0.257 $ 0.435 (40.9)% $ 0.815 $ 1.114 (26.8)%
Adjusted net earnings (1) $ 121,467 $ 93,878 29.4 % $ 368,481 $ 401,168 (8.1)%
Per share (1) $ 0.268 $ 0.208 28.8 % $ 0.814 $ 0.889 (8.4)%
Operating cash flows $ 171,103 $ 154,497 10.7 % $ 508,584 $ 571,396 (11.0)%
Per share (1) $ 0.378 $ 0.342 10.5 % $ 1.123 $ 1.266 (11.3)%
All amounts in thousands except gold, palladium & gold equivalent ounces,
and per share amounts.
Financial Review
Revenues
Revenue in the third quarter of 2023 was $223 million (65% gold, 32% silver,
2% palladium and 1% cobalt), with the $4 million increase relative to the
prior period quarter being primarily due to a 16% increase in realized
commodity prices, partially offset by lower sales volumes.
Revenue was $703 million in the nine months ended September 30, 2023,
representing a $126 million decrease from the comparable period of the
previous year due primarily to an 18% decrease in the number of GEOs³ sold,
resulting from lower production and relative changes in the GEOs³ produced
but not yet delivered; partially offset by a 4% increase in the average
realized gold equivalent³ price.
Cash Costs and Margin
Average cash costs¹ in the third quarter of 2023 were $418 per GEO³ as
compared to $451 in the third quarter of 2022. This resulted in a cash
operating margin¹ of $1,457 per GEO³ sold, an increase of 25% as compared
with the third quarter of 2022, a result of the higher realized price per
ounce.
Average cash costs¹ for the nine months ended September 30, 2023 were $427
per GEO³ as compared to $448 in the comparable period of the previous year.
This resulted in a cash operating margin¹ of $1,445 per GEO³ sold, a 7%
increase from the comparable period of the previous year.
Cash Flow from Operations
Operating cash flow in the third quarter of 2023 amounted to $171 million,
with the $17 million increase due primarily to the higher realized price per
GEO sold coupled with higher amounts of interest received in the third quarter
of 2023.
Operating cash flows for the nine months ended September 30, 2023 amounted to
$509 million, with the $63 million decrease from the comparable period of the
previous year being due primarily to lower sales volumes, partially offset by
higher amounts of interest received during the current year.
Balance Sheet (at September 30, 2023)
· Approximately $834 million of cash on hand
· During the third quarter of 2023, the Company made total upfront cash
payments of $90 million relative to the mineral stream interests consisting of
- $70 million payment relative to the Blackwater Silver precious metals
purchase agreement ("PMPA"); and
- a $20 million payment relative to the expansion of the Blackwater Gold
PMPA
· With the existing cash on hand coupled with the fully undrawn $2
billion revolving credit facility, the Company is well positioned to fund all
outstanding commitments and known contingencies as well as providing
flexibility to acquire additional accretive mineral stream interests.
Third Quarter Operating Asset Highlights
Salobo: In the third quarter of 2023, Salobo produced 69,000 ounces of
attributable gold, an increase of approximately 56% relative to the third
quarter of 2022, driven by higher throughput, with production from the third
concentrator line commencing at the end of 2022, and higher recoveries. The
prior year was also affected by planned and corrective maintenance being
performed. In the third quarter of 2023, Salobo reached its highest production
level since the fourth quarter of 2019 as the ramp-up of the Salobo III
expansion continues to advance. Salobo is expected to reach a throughput
capacity of 32 Mtpa in the fourth quarter of 2023 and full throughput capacity
by the end of 2024.
Antamina: In the third quarter of 2023, Antamina produced 0.9 million ounces
of attributable silver, a decrease of approximately 35% relative to the third
quarter of 2022, primarily due to lower grades as per the mine plan.
Peñasquito: In the third quarter of 2023, Peñasquito had no production
resulting from a suspension of operations at the mine which began on June 7,
2023 due to a labour dispute. On October 13, 2023, Newmont Corporation
("Newmont") reached a definitive agreement to end the strike and has since
begun the safe ramp-up of operations. Newmont expects to reach full operating
capacity by the end of the fourth quarter.
Constancia: In the third quarter of 2023, Constancia produced 0.7 million
ounces of attributable silver and 19,000 ounces of attributable gold, an
increase of approximately 24% and 164%, respectively, relative to the third
quarter of 2022. Record quarterly gold production combined with strong silver
production are a result of significantly higher grades from mining the
high-grade zones of the Pampacancha deposit, higher recoveries and higher
throughput. As per Hudbay Minerals Inc. ("Hudbay"), production is expected to
continue to benefit from higher grades in the fourth quarter of 2023.
Sudbury: In the third quarter of 2023, Vale's Sudbury mines produced 4,300
ounces of attributable gold, an increase of approximately 24% relative to the
third quarter of 2022, due to higher grades which as per Vale, were partially
offset by the annual planned maintenance activities at the Sudbury and
Thompson mines and mills, as well as additional maintenance at the Sudbury
refinery in the third quarter.
Stillwater: In the third quarter of 2023, the Stillwater mines produced 2,500
ounces of attributable gold and 4,000 ounces of attributable palladium, an
increase of approximately 34% for gold and 24% for palladium relative to the
third quarter of 2022, due primarily to the impact on production resulting
from regional flooding that occurred in the second quarter of 2022.
San Dimas: In the third quarter of 2023, San Dimas produced 10,000 ounces of
attributable gold, a decrease of approximately 15% relative to the third
quarter of 2022, primarily due to lower grades, partially offset by higher
throughput.
Voisey's Bay: In the third quarter of 2023, the Voisey's Bay mine produced
183,000 pounds of attributable cobalt, a decrease of approximately 19%
relative to the third quarter of 2022, primarily due to mining lower grade
material during the ongoing transitional period between the depletion of the
Ovoid open-pit mine and ramp-up to full production of the Voisey's Bay
underground project. Production in the third quarter was also impacted as a
result of maintenance at the Long Harbour Refinery. Vale reports that physical
completion of the Voisey's Bay underground mine extension was 88% at the end
of the third quarter, with Reid Brook's bulk material handling system near
mechanical completion, and the commissioning of sub-systems currently taking
place. Vale achieved the first ore production from the Reid Brook deposit, the
first of two underground mines to be developed in the project, in the second
quarter of 2021. Eastern Deeps, the second deposit, has started to extract
development ore from the deposit and is continuing its scheduled production
ramp-up.
Other Gold: In the third quarter of 2023, total Other Gold attributable
production was 700 ounces, a decrease of approximately 81% relative to the
third quarter of 2022, primarily due to the closure of the Minto mine in May
2023.
Other Silver: In the third quarter of 2023, total Other Silver attributable
production was 1.8 million ounces, a decrease of approximately 6% relative to
the third quarter of 2022, primarily due to the termination of the Yauliyacu
PMPA.
Aljustrel: On September 12, 2023, it was announced that as a result of low
zinc prices, the production of zinc and lead concentrates at Aljustrel will be
halted from September 24, 2023 until the second quarter of 2025.
Detailed mine-by-mine production and sales figures can be found in the
Appendix to this press release and in Wheaton's consolidated MD&A in the
'Results of Operations and Operational Review' section.
Third Quarter Development Asset Highlights
Blackwater Project: On July 4, 2023, Artemis announced receipt of the
Fisheries Act Authorization for development of the Blackwater Project, which
will facilitate the commencement of construction of water diversion structures
and dams in the Davidson Creek valley which runs through the basin of the
Blackwater tailings storage facility. On October 24, 2023, Artemis announced
that overall construction at the Blackwater mine was 45% complete as of
September 30, 2023. Project development continues to advance on the schedule,
targeting first gold pour in the second half of 2024.
Marmato Mine: On July 12, 2023, Aris Mining announced that they have received
approval from the Corporación Autónoma Regional del Caldas, a regional
environmental authority in Colombia, of the Environmental Management Plan,
which now permits the development of the Marmato Lower Mine.
Marathon Project: On August 30, 2023, Generation Mining Limited ("Gen Mining")
received the Endangered Species Act permit issued by the Ministry of the
Environment, Conservation and Parks. This permit includes conditions intended
to minimize impacts to caribou and SAR bats, as well as to create an overall
benefit for these species at risk. Additionally, in September 2023, Gen Mining
received the Environmental Compliance Approval issued by the Ministry of
Environment, Conservations and Parks for air and noise emissions for the
Marathon Project, and on November 7, 2023, announced that the province of
Ontario had accepted and filed the Closure Plan, representing another major
milestone in the permitting process. Additional permits and approvals are
expected to be received during the balance of 2023.
Copper World Complex: On September 8, 2023, Hudbay announced the results of
the enhanced pre-feasibility study for Phase I of its 100%-owned Copper World
project in Arizona. After receipt of two outstanding permits which are
expected in mid-2024, Hudbay intends to complete a minority joint venture
partner process prior to commencing a definitive feasibility study. The
opportunity to sanction Copper World is not expected until 2025 based on
current estimated timelines. With the results from this pre-feasibility study,
the Company has now incorporated gold in the mineral reserves and mineral
resources statement on our website.
Curipamba Project: On September 11, 2023, Adventus provided an update that the
Constitutional Court of Ecuador declared that processing of an
unconstitutionality claim filed by the indigenous group CONAIE and other
complainants against Presidential Decree 754 that regulates environmental
consultation for all public and private industries and sectors in Ecuador was
a priority and set a public hearing for September 18, 2023. Adventus has
indicated that historically the Court can be expected to issue a resolution
within two to three months following the public hearing commencement.
On October 2, 2023, Adventus announced that the El Domo - Curipamba project
has been issued a favourable Certificate of No Affect of Water by the Ministry
of Environment and Water of the Government of Ecuador. This certificate and
milestone allow the planned and designed projected infrastructure construction
in an area with the presence of surface and ground water sources.
Goose Project: On September 18, 2023, B2Gold provided a construction update on
the Goose Project highlighting that the purchasing of materials and supplies
needed to support the 2024 construction campaign has been completed and all
materials have been provided to the ports for the 2023 sealift. Additionally,
B2Gold reported that it remains on track to pour first gold in the first
quarter of 2025, and that concrete and steel work in the mill area are
progressing ahead of schedule.
Cangrejos Project
On October 18, 2023, Lumina Gold Corp., ("Lumina") announced that the
Cangrejos project is proceeding on schedule. Lumina has been actively
executing its 2023 feasibility study drill plan with nine rigs currently at
site. Lumina has signed contracts with several engineering companies for the
advancement of the feasibility study. The feasibility study is expected to be
completed in the first quarter of 2025.
Corporate Development
Black Pine Project
On September 10, 2023, the Company acquired a new 0.5% Net Smelter Royalty
("NSR") from Liberty Gold Corp., ("Liberty Gold") on the Black Pine Oxide Gold
Project ("Black Pine") for total cash consideration of $4 million. Liberty
Gold has been granted an option to repurchase 50% of the NSR for $4 million at
any point in time up to the earlier of commercial production at Black Pine or
January 1, 2030. The Company has been granted a Right of First Refusal on all
royalties, streams or pre-pays that include precious metals pertaining to
Black Pine. In addition, the Company made an equity investment of $5 million
in Liberty Gold at C$0.34 per share.
Mineral Park Project
On October 24, 2023, the Company announced that it had entered into a PMPA
(the "Mineral Park PMPA") with Waterton Copper in respect of silver production
from the Mineral Park mine located in Arizona, USA (the "Project" or "Mineral
Park"). Under the Mineral Park PMPA, Wheaton will purchase 100% of the payable
silver from Mineral Park for the life of the mine. Under the terms of the
Mineral Park PMPA, the Company is committed to pay Waterton Copper total
upfront cash consideration of $115 million in four payments during
construction through three installments of $25 million and a final installment
of $40 million. In addition, Wheaton will make ongoing payments for the silver
ounces delivered equal to 18% of the spot price of silver until the value of
the silver delivered, net of the production payment, is equal to the upfront
consideration of $115 million, at which point the production payment will
increase to 22% of the spot price of silver. The Company has also entered into
a loan agreement to provide a secured debt facility of up to $25 million to
the Mineral Park owner, an affiliate of Waterton Copper, once the full upfront
consideration has been paid.
Sustainability
Ratings & Awards:
· In the third quarter of 2023, Wheaton was recognized as Best Company
for ESG & Sustainability (Metals & Mining) and runner-up for Best
Company for Climate Reporting (Large Cap) by ESG Investing's Corporate ESG
Awards.
Community Investment Program:
· In the third quarter of 2023, the Tour De Cure Presented by Wheaton
attracted over 1,500 riders and raised more than $7.1 million for the BC
Cancer Foundation.
· In the third quarter of 2023, a number of new programs were established
with First Majestic Silver. These include support for the operation of a
community centre, improvements to a solid waste storage facility and the
implementation of a recycling program, as well as the implementation and
operation of wastewater treatment facilities in the community of Tayoltita. In
addition, Wheaton also committed to assisting First Majestic Silver in
providing internet access for several remote communities close to the mine.
Management Update
Wheaton announces management changes effective October 1, 2023, including the
creation of a Chief Sustainability Officer position as well as Vice President
appointments. Patrick Drouin, Wheaton's former Senior Vice President of
Sustainability and Investor Relations, has been appointed President of Wheaton
International, succeeding Nik Tatarkin who although retiring from management,
will remain on the Board of Wheaton International. Mr. Drouin will continue to
oversee the Company's ESG practices and performance at the executive level as
President of Wheaton International and Chief Sustainability Officer.
Emma Murray has been appointed Vice President, Investor Relations, effective
October 1, 2023, and will be primarily responsible for liaising with the
investment community and ensuring the market is well-informed about Wheaton's
strategic vision, financial performance and growth prospects.
Simona Antolak has been appointed Vice President, Communications and Corporate
Affairs, with responsibility over external and internal communications as well
as sustainability matters.
These changes further strengthen Wheaton's global management team.
About Wheaton Precious Metals Corp. and Outlook
Wheaton is the world's premier precious metals streaming company with the
highest-quality portfolio of long-life, low-cost assets. Its business model
offers investors commodity price leverage and exploration upside but with a
much lower risk profile than a traditional mining company. Wheaton delivers
amongst the highest cash operating margins in the mining industry, allowing it
to pay a competitive dividend and continue to grow through accretive
acquisitions. As a result, Wheaton has consistently outperformed gold and
silver, as well as other mining investments. Wheaton is committed to strong
ESG practices and giving back to the communities where Wheaton and its mining
partners operate. Wheaton creates sustainable value through streaming for all
of its stakeholders.
Wheaton's estimated attributable production in 2023 is forecast to be
approximately 600,000 to 660,000 GEOs, unchanged from previous
guidance(2)(,)(3). Due to the temporary suspension of the Peñasquito mine
from June 7, 2023 to October 13, 2023, Wheaton now expects its full-year
production to have a higher weighting toward gold. The Company has previously
estimated that average annual production for the five-year period ending in
2027 would amount to 810,000 GEOs, while for the ten-year period ending in
2032, the Company estimated that average annual production would amount to
850,000 GEOs. The Company will provide updated longer-term guidance in normal
course in the first quarter of 2024, which will incorporate the impact of
recent developments and acquisitions(2)(,)(3).
In accordance with Wheaton Precious Metals™ Corp.'s ("Wheaton Precious
Metals", "Wheaton" or the "Company") MD&A and Financial Statements,
reference to the Company and Wheaton includes the Company's wholly owned
subsidiaries
Webcast and Conference Call Details
A conference call will be held on Friday, November 10, 2023, starting at 11:00
am ET (8:00 am PT) to discuss these results. To participate in the live call,
please use one of the following methods:
Dial toll free from Canada or the US: 1-888-664-6383
Dial from outside Canada or the US: 1-416-764-8650
Pass
code:
35621453
Live
webcast:
Webcast URL (https://app.webinar.net/dEjrgQAgbMx)
The accompanying slideshow will also be available in PDF format on the
'Presentations' page of the Wheaton Precious Metals website
(https://www.wheatonpm.com/Investors/presentations/default.aspx?LanguageId=1)
before the conference call. The conference call will be recorded and available
until November 17, 2023 at 11:59 pm ET. The webcast will be available for one
year. You can listen to an archive of the call by one of the following
methods:
Dial toll free from Canada or the US: 1-888-390-0541
Dial from outside Canada or the US: 1-416-764-8677
Pass
code:
621453 #
Archived webcast:
Webcast URL (https://app.webinar.net/dEjrgQAgbMx)
This earnings release should be read in conjunction with Wheaton Precious
Metals' MD&A and Financial Statements, which are available on the
Company's website at www.wheatonpm.com and have been posted on SEDAR+ at
www.sedarplus.ca.
Mr. Wes Carson, P.Eng., Vice President, Mining Operations, Neil Burns, P.Geo.,
Vice President, Technical Services for Wheaton Precious Metals and Ryan
Ulansky, P.Eng., Vice President, Engineering, are a "qualified person" as such
term is defined under National Instrument 43-101, and have reviewed and
approved the technical information disclosed in this news release
(specifically Mr. Carson has reviewed production figures, Mr. Burns has
reviewed mineral resource estimates and Mr. Ulansky has reviewed the mineral
reserve estimates).
Wheaton Precious Metals believes that there are no significant differences
between its corporate governance practices and those required to be followed
by United States domestic issuers under the NYSE listing standards. This
confirmation is located on the Wheaton Precious Metals website at
http://www.wheatonpm.com/Company/corporate-governance/default.aspx
(http://www.wheatonpm.com/Company/corporate-governance/default.aspx)
(http://www.silverwheaton.com/company/corporate-governance/default.aspx) .
For further information:
Investor Contact
Emma Murray
Vice President, Investor Relations
Tel: 1-844-288-9878
Email: info@wheatonpm.com
Media Contact
Simona Antolak
Vice President, Communications & Corporate Affairs
Tel: 604-639-9870
Email: simona.antolak@wheatonpm.com
End Notes
Condensed Interim Consolidated Statements of Earnings
Three Months Ended Nine Months Ended
September 30
September 30
(US dollars and shares in thousands, except per share amounts - unaudited) 2023 2022 2023 2022
Sales $ 223,137 $ 218,836 $ 702,573 $ 829,002
Cost of sales
Cost of sales, excluding depletion $ 49,808 $ 60,955 $ 160,413 $ 205,891
Depletion 46,435 55,728 145,908 178,812
Total cost of sales $ 96,243 $ 116,683 $ 306,321 $ 384,703
Gross margin $ 126,894 $ 102,153 $ 396,252 $ 444,299
General and administrative expenses 8,606 8,360 28,922 27,448
Share based compensation 4,336 77 16,217 11,586
Donations and community investments 1,736 1,406 5,054 3,379
Impairment reversal of mineral stream interests - (10,330) - (10,330)
Earnings from operations $ 112,216 $ 102,640 $ 346,059 $ 412,216
Gain on disposal of mineral stream interest - (104,425) (5,027) (104,425)
Other (income) expense (10,707) (2,799) (26,961) (3,448)
Earnings before finance costs and income taxes $ 122,923 $ 209,864 $ 378,047 $ 520,089
Finance costs 1,407 1,398 4,138 4,209
Earnings before income taxes $ 121,516 $ 208,466 $ 373,909 $ 515,880
Income tax expense (5,145) (12,006) (4,700) (12,879)
Net earnings $ 116,371 $ 196,460 $ 369,209 $ 503,001
Basic earnings per share $ 0.257 $ 0.435 $ 0.815 $ 1.114
Diluted earnings per share $ 0.257 $ 0.434 $ 0.814 $ 1.112
Weighted average number of shares outstanding
Basic 452,975 451,757 452,748 451,402
Diluted 453,538 452,386 453,419 452,221
Condensed Interim Consolidated Balance Sheets
As at As at
September 30
December 31
(US dollars in thousands - unaudited) 2023 2022
Assets
Current assets
Cash and cash equivalents $ 833,919 $ 696,089
Accounts receivable 10,492 10,187
Cobalt inventory 2,429 10,530
Taxes receivable 5,000 -
Other 4,353 3,287
Total current assets $ 856,193 $ 720,093
Non-current assets
Mineral stream interests $ 5,737,454 $ 5,707,019
Early deposit mineral stream interests 47,093 46,092
Long-term equity investments 200,893 256,095
Property, plant and equipment 8,092 4,210
Other 31,790 26,397
Total non-current assets $ 6,025,322 $ 6,039,813
Total assets $ 6,881,515 $ 6,759,906
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 11,999 $ 12,570
Current taxes payable - 2,763
Current portion of performance share units 9,404 14,566
Current portion of lease liabilities 590 818
Total current liabilities $ 21,993 $ 30,717
Non-current liabilities
Performance share units $ 6,222 $ 6,673
Lease liabilities 5,654 1,152
Deferred income taxes 189 165
Pension liability 4,196 3,524
Total non-current liabilities $ 16,261 $ 11,514
Total liabilities $ 38,254 $ 42,231
Shareholders' equity
Issued capital $ 3,774,333 $ 3,752,662
Reserves (78,872) 66,547
Retained earnings 3,147,800 2,898,466
Total shareholders' equity $ 6,843,261 $ 6,717,675
Total liabilities and shareholders' equity $ 6,881,515 $ 6,759,906
Condensed Interim Consolidated Statements of Cash Flows
Three Months Ended Nine Months Ended
September 30
September 30
(US dollars in thousands - unaudited) 2023 2022 2023 2022
Operating activities
Net earnings $ 116,371 $ 196,460 $ 369,209 $ 503,001
Adjustments for
Depreciation and depletion 46,784 56,129 147,031 180,004
Gain on disposal of mineral stream interest - (104,425) (5,027) (104,425)
Impairment (reversal of impairment) of mineral stream interests - (10,330) - (10,330)
Interest expense 78 22 131 72
Equity settled stock based compensation 1,732 1,568 5,133 4,407
Performance share units - expense 2,604 (1,491) 11,084 7,179
Performance share units - paid - (163) (16,675) (18,411)
Pension expense 329 291 787 720
Pension paid - - (116) -
Income tax expense (recovery) 5,145 12,006 4,700 12,879
Loss (gain) on fair value adjustment of share purchase warrants held 143 204 248 1,101
Investment income recognized in net earnings (10,537) (1,953) (26,564) (2,696)
Other 163 (349) 662 (440)
Change in non-cash working capital (489) 4,728 (876) (3,825)
Cash generated from operations before income taxes and interest $ 162,323 $ 152,697 $ 489,727 $ 569,236
Income taxes paid (912) (29) (5,244) (141)
Interest paid (79) (22) (112) (73)
Interest received 9,771 1,851 24,213 2,374
Cash generated from operating activities $ 171,103 $ 154,497 $ 508,584 $ 571,396
Financing activities
Credit facility extension fees $ (13) $ (1,205) $ (859) $ (1,207)
Share purchase options exercised 93 - 10,603 7,549
Lease payments (169) (201) (548) (603)
Dividends paid (66,994) (59,487) (198,085) (176,604)
Cash used for financing activities $ (67,083) $ (60,893) $ (188,889) $ (170,865)
Investing activities
Mineral stream interests $ (90,710) $ (46,675) $ (210,944) $ (107,476)
Early deposit mineral stream interests (250) (750) (1,000) (1,500)
Mineral royalty interest (3,602) - (3,602) -
Net proceeds on disposal of mineral stream interests - (139) 46,400 (139)
Acquisition of long-term investments (5,006) - (13,181) (22,768)
Proceeds on disposal of long-term investments - - 202 -
Dividends received 700 102 1,617 322
Other (35) (69) (1,804) (194)
Cash used for investing activities $ (98,903) $ (47,531) $ (182,312) $ (131,755)
Effect of exchange rate changes on cash and cash equivalents $ (35) $ (81) $ 447 $ (203)
Increase in cash and cash equivalents $ 5,082 $ 45,992 $ 137,830 $ 268,573
Cash and cash equivalents, beginning of period 828,837 448,626 696,089 226,045
Cash and cash equivalents, end of period $ 833,919 $ 494,618 $ 833,919 $ 494,618
Summary of Units Produced
Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Q4 2021
Gold ounces produced ²
Salobo 69,045 54,804 43,677 37,939 44,212 34,129 44,883 48,235
Sudbury (3) 4,266 5,818 6,203 5,270 3,437 5,289 5,362 4,379
Constancia 19,003 7,444 6,905 10,496 7,196 8,042 6,311 9,857
San Dimas (4) 9,995 11,166 10,754 10,037 11,808 10,044 10,461 13,714
Stillwater (5) 2,454 2,017 1,960 2,185 1,833 2,171 2,497 2,664
Other
Marmato 673 639 457 533 542 778 477 479
777 (6) - - - - - 3,509 4,003 4,462
Minto - 1,292 3,063 2,567 3,050 2,480 4,060 3,506
Total Other 673 1,931 3,520 3,100 3,592 6,767 8,540 8,447
Total gold ounces produced 105,436 83,180 73,019 69,027 72,078 66,442 78,054 87,296
Silver ounces produced (2)
Peñasquito (7) - 1,744 2,076 1,761 2,017 2,089 2,219 2,145
Antamina 864 960 851 1,067 1,327 1,330 1,210 1,309
Constancia 697 420 552 655 564 584 506 578
Other
Los Filos 28 28 28 14 21 35 42 37
Zinkgruvan 785 374 632 664 642 739 577 482
Neves-Corvo 486 407 436 369 323 345 344 522
Aljustrel 327 279 343 313 246 292 287 325
Cozamin 165 184 141 157 179 169 186 213
Marmato 11 7 8 9 7 7 11 7
Yauliyacu (8) - - - 261 463 756 637 382
Stratoni (9) - - - - - - - 129
Minto - 14 29 33 33 26 45 44
Keno Hill (10) - - - - - 48 20 30
777 (6) - - - - - 80 91 96
Total Other 1,802 1,293 1,617 1,820 1,914 2,497 2,240 2,267
Total silver ounces produced 3,363 4,417 5,096 5,303 5,822 6,500 6,175 6,299
Palladium ounces produced ²
Stillwater (5) 4,006 3,880 3,705 3,869 3,229 3,899 4,488 4,733
Cobalt pounds produced ²
Voisey's Bay 183 152 124 128 226 136 234 381
GEOs produced (11) 154,800 145,797 144,000 142,887 153,025 155,932 164,911 177,490
Average payable rate (2)
Gold 95.5% 95.1% 95.1% 94.9% 95.1% 95.1% 95.2% 96.0%
Silver 79.0% 83.2% 82.3% 83.6% 85.8% 85.9% 86.3% 86.2%
Palladium 93.6% 94.1% 96.0% 91.7% 95.0% 94.6% 92.7% 92.2%
Cobalt 93.3% 93.3% 93.3% 93.3% 93.3% 93.3% 93.3% 93.3%
GEO (11) 90.8% 90.4% 89.3% 89.3% 90.4% 90.4% 90.7% 91.5%
1) All figures in thousands except gold and palladium ounces produced.
2) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures and payable rates are based on information
provided by the operators of the mining operations to which the mineral stream
interests relate or management estimates in those situations where other
information is not available. Certain production figures and payable rates may
be updated in future periods as additional information is received.
3) Comprised of the Coleman, Copper Cliff, Garson, Creighton and Totten
gold interests.
4) Under the terms of the San Dimas PMPA, the Company is entitled to an
amount equal to 25% of the payable gold production plus an additional amount
of gold equal to 25% of the payable silver production converted to gold at a
fixed gold to silver exchange ratio of 70:1 from the San Dimas mine. If the
average gold to silver price ratio decreases to less than 50:1 or increases to
more than 90:1 for a period of 6 months or more, then the "70" shall be
revised to "50" or "90", as the case may be, until such time as the average
gold to silver price ratio is between 50:1 to 90:1 for a period of 6 months or
more in which event the "70" shall be reinstated. For reference, attributable
silver production from prior periods is as follows: Q3 2023 - 387,000 ounces;
Q2 2023 - 423,000 ounces; Q1 2023 - 401,000 ounces; Q4 2022 - 348,000 ounces;
Q3 2022 - 412,000 ounces; Q2 2022 - 382,000 ounces; Q1 2022 - 408,000 ounces;
Q4 2021 - 544,000 ounces.
5) Comprised of the Stillwater and East Boulder gold and palladium
interests.
6) On June 22, 2022, Hudbay announced that mining activities at 777 have
concluded and closure activities have commenced.
7) There was a temporary suspension of operations at Peñasquito due to a
labour strike which ran from June 7, 2023 to October 13, 2023.
8) On December 14, 2022 the Company terminated the Yauliyacu PMPA in
exchange for a cash payment of $132 million.
9) The Stratoni mine was placed into care and maintenance during Q4-2021.
10) On September 7, 2022, the Company
terminated the Keno Hill PMPA in exchange for $141 million of Hecla common
stock.
11) GEOs, which are provided to assist the
reader, are based on the following commodity price assumptions: $1,850 per
ounce gold; $24.00 per ounce silver; $1,800 per ounce palladium; and $18.75
per pound cobalt; consistent with those used in estimating the Company's
production guidance for 2023.
Summary of Units Sold
Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Q4 2021
Gold ounces sold
Salobo 44,444 46,030 35,966 41,029 31,818 48,515 42,513 47,171
Sudbury (2) 4,836 4,775 4,368 4,988 5,147 7,916 3,712 965
Constancia 12,399 9,619 6,579 6,013 6,336 7,431 10,494 6,196
San Dimas 9,695 11,354 10,651 10,943 10,196 10,633 10,070 15,182
Stillwater (3) 1,985 2,195 2,094 1,783 2,127 2,626 2,628 2,933
Other
Marmato 792 467 480 473 719 781 401 423
777 275 153 126 785 3,098 3,629 4,388 4,290
Minto - 701 2,341 2,982 2,559 2,806 3,695 2,462
Total Other 1,067 1,321 2,947 4,240 6,376 7,216 8,484 7,175
Total gold ounces sold 74,426 75,294 62,605 68,996 62,000 84,337 77,901 79,622
Silver ounces sold
Peñasquito 453 1,913 1,483 2,066 1,599 2,096 2,188 1,818
Antamina 794 963 814 1,114 1,155 1,177 1,468 1,297
Constancia 435 674 366 403 498 494 644 351
Other
Los Filos 30 37 34 16 24 41 42 17
Zinkgruvan 714 370 520 547 376 650 355 346
Neves-Corvo 245 132 171 80 105 167 204 259
Aljustrel 142 182 205 156 185 123 145 133
Cozamin 139 150 119 150 154 148 177 174
Marmato 11 7 7 7 8 11 8 8
Yauliyacu - - - 337 1,005 817 44 551
Stratoni - - - - - (2) 133 42
Minto - 7 29 23 22 21 31 27
Keno Hill - - 1 1 30 30 27 24
777 2 2 - 35 73 75 87 69
Total Other 1,283 887 1,086 1,352 1,982 2,081 1,253 1,650
Total silver ounces sold 2,965 4,437 3,749 4,935 5,234 5,848 5,553 5,116
Palladium ounces sold
Stillwater (3) 4,242 3,392 2,946 3,396 4,227 3,378 4,075 4,641
Cobalt pounds sold
Voisey's Bay 198 265 323 187 115 225 511 228
GEOs sold (4) 119,030 138,835 117,383 138,218 135,179 165,766 159,082 152,826
Cumulative payable units PBND (5)
Gold ounces 99,923 73,403 69,479 62,602 65,978 59,331 81,365 84,989
Silver ounces 1,071 1,325 2,065 1,606 2,287 2,438 2,693 3,042
Palladium ounces 5,607 6,122 5,751 5,098 5,041 6,267 5,535 5,629
Cobalt pounds 376 250 285 257 402 280 550 596
GEO (4) 123,086 99,084 104,749 91,001 104,623 99,895 127,257 135,964
Inventory on hand
Cobalt pounds 155 310 398 633 556 582 410 657
1) All figures in thousands except gold and palladium ounces sold.
2) Comprised of the Coleman, Copper Cliff, Garson, Creighton and Totten
gold interests.
3) Comprised of the Stillwater and East Boulder gold and palladium
interests.
4) GEOs, which are provided to assist the reader, are based on the
following commodity price assumptions: $1,850 per ounce gold; $24.00 per ounce
silver; $1,800 per ounce palladium; and $18.75 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2023.
5) Payable gold, silver and palladium ounces as well as cobalt pounds
produced but not yet delivered ("PBND") are based on management estimates.
These figures may be updated in future periods as additional information is
received.
Results of Operations
The operating results of the Company's reportable operating segments are
summarized in the tables and commentary below.
Three Months Ended September 30, 2023
Units Produced² Units Average Average Average Sales Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 69,045 44,444 $ 1,944 $ 420 $ 330 $ 86,395 $ 53,026 $ 67,710 $ 2,341,485
Sudbury (4) 4,266 4,836 1,950 400 1,204 9,428 1,669 7,494 268,224
Constancia 19,003 12,399 1,944 419 316 24,102 14,991 18,906 86,555
San Dimas 9,995 9,695 1,944 631 260 18,846 10,216 12,732 147,638
Stillwater 2,454 1,985 1,944 349 510 3,859 2,154 3,167 212,650
Other (5) 673 1,067 1,945 368 391 2,077 1,266 1,684 557,035
105,436 74,426 $ 1,944 $ 444 $ 381 $ 144,707 $ 83,322 $ 111,693 $ 3,613,587
Silver
Peñasquito - 453 $ 23.82 $ 4.43 $ 4.06 $ 10,804 $ 6,952 $ 8,795 $ 278,028
Antamina 864 794 23.82 4.81 7.06 18,915 9,496 15,097 527,227
Constancia 697 435 23.82 6.18 6.24 10,360 4,958 7,674 183,736
Other (6) 1,802 1,283 23.62 5.15 2.64 30,293 20,301 19,439 549,641
3,363 2,965 $ 23.73 $ 5.10 $ 4.57 $ 70,372 $ 41,707 $ 51,005 $ 1,538,632
Palladium
Stillwater 4,006 4,242 $ 1,251 $ 223 $ 459 $ 5,307 $ 2,416 $ 4,361 $ 222,154
Platinum
Marathon - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ 9,450
Cobalt
Voisey's Bay 183 198 $ 13.87 $ 3.66 ⁷ $ 12.98 $ 2,751 $ (551) $ 4,235 $ 353,631
Operating results $ 223,137 $ 126,894 $ 171,294 $ 5,737,454
Other
General and administrative $ (8,606) $ (6,321)
Share based compensation (4,336) -
Donations and community investments (1,736) (1,750)
Finance costs (1,407) (1,078)
Other 10,707 9,870
Income tax (5,145) (912)
Total other $ (10,523) $ (191) $ 1,144,061
$ 116,371 $ 171,103 $ 6,881,515
1) Units of gold, silver and palladium produced and sold are reported in
ounces, while cobalt is reported in pounds. All figures in thousands except
gold and palladium ounces produced and sold and per unit amounts.
2) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
4) Comprised of the operating Coleman, Copper Cliff, Garson, Creighton and
Totten gold interests and the non-operating Stobie and Victor gold interests.
5) Comprised of the operating Marmato gold interests as well as the
non-operating Minto, 777, Copper World Complex, Santo Domingo, Blackwater,
Fenix, Goose, Marathon, Curipamba and Cangrejos gold interests. On June 22,
2022, Hudbay announced that mining activities at 777 have concluded and
closure activities have commenced. On May 13, 2023, Minto announced the
suspension of operations at the Minto mine.
6) Comprised of the operating Los Filos, Zinkgruvan, Neves-Corvo,
Aljustrel, Cozamin and Marmato silver interests and the non-operating Minto,
777, Loma de La Plata, Stratoni, Pascua-Lama, Copper World Complex, Blackwater
and Curipamba silver interests. On June 22, 2022, Hudbay announced that mining
activities at 777 have concluded and closure activities have commenced. On May
13, 2023, Minto announced the suspension of operations at the Minto mine. On
September 12, 2023, it was announced that the production of zinc and lead
concentrates at Aljustrel will be halted from September 24, 2023 until the
second quarter of 2025.
7) Cash cost per pound of cobalt sold during the third quarter of 2023 was
net of a previously recorded inventory write-down of $0.1 million, resulting
in a decrease of $0.51 per pound of cobalt sold. The Company reflects the
cobalt inventory at the lower of cost and net realizable value, and will
continue to monitor the market price of cobalt relative to the carrying value
of the inventory at each reporting period.
On a gold equivalent basis, results for the Company for the three months ended
September 30, 2023 were as follows:
Three Months Ended September 30, 2023
Ounces Ounces Average Average Cash Operating Margin Average Gross
Produced (1)
Sold
Realized
Cash Cost
($'s Per Ounce) (3)
Depletion
Margin
Price
($'s Per
($'s Per
($'s Per
($'s Per
Ounce) (2)
Ounce)
Ounce)
Ounce)
Gold equivalent basis (4) 154,800 119,030 $ 1,875 $ 418 $ 1,457 $ 390 $ 1,067
1) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
2) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
3) Refer to discussion on non-IFRS measure (iv) at the end of this press
release.
4) GEOs, which are provided to assist the reader, are based on the
following commodity price assumptions: $1,850 per ounce gold; $24.00 per ounce
silver; $1,800 per ounce palladium; and $18.75 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2023.
Three Months Ended September 30, 2022
Units Produced² Units Average Average Average Sales Impairment Reversals / Gain on Disposal (4) Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 44,212 31,818 $ 1,724 $ 416 $ 334 $ 54,860 $ - $ 31,000 $ 41,617 $ 2,396,952
Sudbury (5) 3,437 5,147 1,745 400 1,092 8,984 - 1,303 5,943 288,863
Constancia 7,196 6,336 1,724 415 271 10,925 - 6,578 8,295 97,213
San Dimas 11,808 10,196 1,724 624 260 17,579 - 8,567 11,213 158,704
Stillwater 1,833 2,127 1,724 317 429 3,667 - 2,080 2,992 216,617
Other (6) 3,592 6,376 1,743 694 59 11,113 - 6,311 5,562 461,359
72,078 62,000 $ 1,728 $ 474 $ 353 $ 107,128 $ - $ 55,839 $ 75,622 $ 3,619,708
Silver
Peñasquito 2,017 1,599 $ 19.30 $ 4.36 $ 3.57 $ 30,857 $ - $ 18,182 $ 23,885 $ 301,040
Antamina 1,327 1,155 19.30 3.75 7.06 22,287 - 9,798 17,951 553,231
Constancia 564 498 19.30 6.12 6.35 9,613 - 3,398 6,563 195,507
Other (7) 1,914 1,982 18.93 7.51 6.84 37,513 114,755 123,823 21,896 538,739
5,822 5,234 $ 19.16 $ 5.59 $ 5.84 $ 100,270 $ 114,755 $ 155,201 $ 70,295 $ 1,588,517
Palladium
Stillwater 3,229 4,227 $ 2,091 $ 353 $ 399 $ 8,838 $ - $ 5,657 $ 7,344 $ 228,168
Platinum
Marathon - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ - $ 9,425
Cobalt
Voisey's Bay 226 115 $ 22.68 $ 7.21 $ 13.63 $ 2,600 $ - $ 211 $ 7,352 $ 361,238
Operating results $ 218,836 $ 114,755 $ 216,908 $ 160,613 $ 5,807,056
Other
General and administrative $ (8,360) $ (5,342)
Share based compensation (77) (163)
Donations and community investments (1,406) (1,410)
Finance costs (1,398) (1,020)
Other 2,799 1,848
Income tax (12,006) (29)
Total other $ (20,448) $ (6,116) $ 780,539
$ 196,460 $ 154,497 $ 6,587,595
1) Units of gold, silver and palladium produced and sold are reported in
ounces, while cobalt is reported in pounds. All figures in thousands except
gold and palladium ounces produced and sold and per unit amounts.
2) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
4) Relates to the termination of the Keno Hill PMPA.
5) Comprised of the operating Coleman, Copper Cliff, Garson, Creighton and
Totten gold interests as well as the non-operating Stobie and Victor gold
interests.
6) Comprised of the operating Minto, 777 and Marmato gold interests as
well as the non-operating Copper World Complex, Santo Domingo, Blackwater,
Fenix, Goose, Marathon and Curipamba gold interests. On June 22, 2022, Hudbay
announced that mining activities at 777 have concluded and closure activities
have commenced. On May 13, 2023, Minto announced the suspension of operations
at the Minto mine.
7) Comprised of the operating Los Filos, Zinkgruvan, Neves-Corvo,
Aljustrel, Minto, 777, Marmato and Cozamin silver interests, the non-operating
Stratoni, Loma de La Plata, Copper World Complex, Pascua-Lama, Blackwater and
Curipamba silver interests and the previously owned Keno Hill and Yauliyacu
silver interests. On June 22, 2022, Hudbay announced that mining activities at
777 have concluded and closure activities have commenced. On September 7,
2022, the Keno Hill PMPA was terminated in exchange for $141 million of Hecla
common stock. On December 14, 2022 the Yauliyacu PMPA was terminated in
exchange for a cash payment of $132 million. On May 13, 2023, Minto announced
the suspension of operations at the Minto mine. On September 12, 2023, it was
announced that the production of zinc and lead concentrates at Aljustrel will
be halted from September 24, 2023 until the second quarter of 2025.
On a gold equivalent basis, results for the Company for the three months ended
September 30, 2022 were as follows:
Three Months Ended September 30, 2022
Ounces Ounces Average Average Cash Operating Margin Average Gross
Produced (1)
Sold
Realized
Cash Cost
($'s Per Ounce) (3)
Depletion
Margin
Price
($'s Per
($'s Per
($'s Per
($'s Per
Ounce) (2)
Ounce)
Ounce)
Ounce)
Gold equivalent basis (4) 153,025 135,179 $ 1,619 $ 451 $ 1,168 $ 412 $ 756
1) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
2) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
3) Refer to discussion on non-IFRS measure (iv) at the end of this press
release.
4) GEOs, which are provided to assist the reader, are based on the
following commodity price assumptions: $1,850 per ounce gold; $24.00 per ounce
silver; $1,800 per ounce palladium; and $18.75 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2023.
Nine Months Ended September 30, 2023
Units Produced² Units Average Average Average Sales Gain on Disposal (4) Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 167,526 126,440 $ 1,947 $ 420 $ 330 $ 246,219 $ - $ 151,287 $ 193,063 $ 2,341,485
Sudbury (5) 16,287 13,979 1,953 400 1,087 27,295 - 6,512 21,420 268,224
Constancia 33,352 28,597 1,948 417 316 55,718 - 34,751 43,779 86,555
San Dimas 31,915 31,700 1,945 628 260 61,657 - 33,535 41,762 147,638
Stillwater 6,431 6,274 1,945 347 510 12,201 - 6,824 10,026 212,650
Other (6) 6,124 5,335 1,935 1,119 172 10,324 - 3,439 4,090 557,035
261,635 212,325 $ 1,947 $ 465 $ 369 $ 413,414 $ - $ 236,348 $ 314,140 $ 3,613,587
Silver
Peñasquito 3,820 3,849 $ 23.63 $ 4.43 $ 4.06 $ 90,967 $ - $ 58,268 $ 73,915 $ 278,028
Antamina 2,675 2,571 23.65 4.69 7.06 60,812 - 30,625 48,765 527,227
Constancia 1,669 1,475 23.75 6.15 6.24 35,034 - 16,750 25,962 183,736
Other (7) 4,712 3,256 23.44 5.58 2.82 76,316 5,027 53,966 55,364 549,641
12,876 11,151 $ 23.60 $ 5.05 $ 4.68 $ 263,129 $ 5,027 $ 159,609 $ 204,006 $ 1,538,632
Palladium
Stillwater 11,591 10,580 $ 1,410 $ 255 $ 440 $ 14,922 $ - $ 7,565 $ 12,223 $ 222,154
Platinum
Marathon - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ - $ 9,450
Cobalt
Voisey's Bay 458 786 $ 14.13 $ 3.36 ⁸ $ 13.63 $ 11,108 $ - $ (2,243) $ 13,056 $ 353,631
Operating results $ 702,573 $ 5,027 $ 401,279 $ 543,425 $ 5,737,454
Other
General and administrative $ (28,922) $ (29,702)
Share based compensation (16,217) (16,675)
Donations and community investments (5,054) (4,896)
Finance costs (4,138) (3,147)
Other 26,961 24,823
Income tax (4,700) (5,244)
Total other $ (32,070) $ (34,841) $ 1,144,061
$ 369,209 $ 508,584 $ 6,881,515
1) Units of gold, silver and palladium produced and sold are reported in
ounces, while cobalt is reported in pounds. All figures in thousands except
gold and palladium ounces produced and sold and per unit amounts.
2) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
4) The gain on disposal of Other silver interests relates to the gain on
the buyback of 33% of the Goose PMPA.
5) Comprised of the operating Coleman, Copper Cliff, Garson, Creighton and
Totten gold interests and the non-operating Stobie and Victor gold interests.
6) Comprised of the operating Marmato gold interests as well as the
non-operating Minto, 777, Copper World Complex, Santo Domingo, Blackwater,
Fenix, Goose, Marathon, Curipamba and Cangrejos gold interests. On June 22,
2022, Hudbay announced that mining activities at 777 have concluded and
closure activities have commenced. On May 13, 2023, Minto announced the
suspension of operations at the Minto mine.
7) Comprised of the operating Los Filos, Zinkgruvan, Neves-Corvo,
Aljustrel, Cozamin and Marmato silver interests and the non-operating Minto,
777, Loma de La Plata, Stratoni, Pascua-Lama, Copper World Complex, Blackwater
and Curipamba silver interests. On June 22, 2022, Hudbay announced that mining
activities at 777 have concluded and closure activities have commenced. On May
13, 2023, Minto announced the suspension of operations at the Minto mine. On
September 12, 2023, it was announced that the production of zinc and lead
concentrates at Aljustrel will be halted from September 24, 2023 until the
second quarter of 2025.
8) Cash cost per pound of cobalt sold during the nine months ended
September 30, 2023 was net of a previously recorded inventory write-down of
$1.6 million, resulting in a decrease of $2.05 per pound of cobalt sold. The
Company reflects the cobalt inventory at the lower of cost and net realizable
value, and will continue to monitor the market price of cobalt relative to the
carrying value of the inventory at each reporting period.
On a gold equivalent basis, results for the Company for the nine months ended
September 30, 2023 were as follows:
Nine Months Ended September 30, 2023
Ounces Ounces Average Average Cash Operating Margin Average Gross
Produced (1)
Sold
Realized
Cash Cost
($'s Per Ounce) (3)
Depletion
Margin
Price
($'s Per
($'s Per
($'s Per
($'s Per
Ounce) (2)
Ounce)
Ounce)
Ounce)
Gold equivalent basis (4) 444,597 375,248 $ 1,872 $ 427 $ 1,445 $ 389 $ 1,056
1) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
2) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
3) Refer to discussion on non-IFRS measure (iv) at the end of this press
release.
4) GEOs, which are provided to assist the reader, are based on the
following commodity price assumptions: $1,850 per ounce gold; $24.00 per ounce
silver; $1,800 per ounce palladium; and $18.75 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2023.
Nine Months Ended September 30, 2022
Units Produced² Units Average Average Average Sales Impairment Reversals / Gain on Disposal (4) Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 123,224 122,846 $ 1,834 $ 416 $ 334 $ 225,267 $ - $ 133,146 $ 174,134 $ 2,396,952
Sudbury (5) 14,088 16,775 1,828 400 1,091 30,673 - 5,657 22,980 288,863
Constancia 21,549 24,261 1,833 413 271 44,480 - 27,886 34,463 97,213
San Dimas 32,313 30,899 1,823 622 260 56,335 - 29,095 37,114 158,704
Stillwater 6,501 7,381 1,829 330 429 13,503 - 7,902 11,070 216,617
Other (6) 18,899 22,076 1,829 734 45 40,388 - 23,183 22,912 461,359
216,574 224,238 $ 1,831 $ 471 $ 348 $ 410,646 $ - $ 226,869 $ 302,673 $ 3,619,708
Silver
Peñasquito 6,325 5,883 $ 22.21 $ 4.36 $ 3.57 $ 130,686 $ - $ 84,058 $ 105,036 $ 301,040
Antamina 3,867 3,800 22.13 4.42 7.06 84,093 - 40,479 66,952 553,231
Constancia 1,654 1,636 22.15 6.09 6.34 36,227 - 15,883 26,260 195,507
Other (7) 6,651 5,316 21.41 7.14 5.61 113,823 114,755 160,768 75,969 538,739
18,497 16,635 $ 21.93 $ 5.43 $ 5.29 $ 364,829 $ 114,755 $ 301,188 $ 274,217 $ 1,588,517
Palladium
Stillwater 11,616 11,680 $ 2,190 $ 383 $ 399 $ 25,574 $ - $ 16,437 $ 21,099 $ 228,168
Platinum
Marathon - - $ n.a $ n.a $ n.a $ - $ - $ - $ - $ 9,425
Cobalt
Voisey's Bay 596 851 $ 32.85 $ 6.24 $ 9.49 $ 27,953 $ - $ 14,560 $ 24,412 $ 361,238
Operating results $ 829,002 $ 114,755 $ 559,054 $ 622,401 $ 5,807,056
Other
General and administrative $ (27,448) $ (28,688)
Share based compensation (11,586) (18,411)
Donations and community investments (3,379) (2,977)
Finance costs (4,209) (3,107)
Other 3,448 2,319
Income tax (12,879) (141)
Total other $ (56,053) $ (51,005) $ 780,539
$ 503,001 $ 571,396 $ 6,587,595
1) Units of gold, silver and palladium produced and sold are reported in
ounces, while cobalt is reported in pounds. All figures in thousands except
gold and palladium ounces produced and sold and per unit amounts.
2) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
4) Relates to the termination of the Keno Hill PMPA.
5) Comprised of the operating Coleman, Copper Cliff, Garson, Creighton and
Totten gold interests as well as the non-operating Stobie and Victor gold
interests.
6) Comprised of the operating Minto, 777 and Marmato gold interests as
well as the non-operating Copper World Complex, Santo Domingo, Blackwater,
Fenix, Goose, Marathon and Curipamba gold interests. On June 22, 2022, Hudbay
announced that mining activities at 777 have concluded and closure activities
have commenced. On May 13, 2023, Minto announced the suspension of operations
at the Minto mine.
7) Comprised of the operating Los Filos, Zinkgruvan, Neves-Corvo,
Aljustrel, Minto, 777, Marmato and Cozamin silver interests, the non-operating
Stratoni, Loma de La Plata, Copper World Complex, Pascua-Lama, Blackwater and
Curipamba silver interests and the previously owned Keno Hill and Yauliyacu
silver interests. On June 22, 2022, Hudbay announced that mining activities at
777 have concluded and closure activities have commenced. On September 7,
2022, the Keno Hill PMPA was terminated in exchange for $141 million of Hecla
common stock. On December 14, 2022 the Yauliyacu PMPA was terminated in
exchange for a cash payment of $132 million. On May 13, 2023, Minto announced
the suspension of operations at the Minto mine. On September 12, 2023, it was
announced that the production of zinc and lead concentrates at Aljustrel will
be halted from September 24, 2023 until the second quarter of 2025.
On a gold equivalent basis, results for the Company for the nine months ended
September 30, 2022 were as follows:
Nine Months Ended September 30, 2022
Ounces Ounces Average Average Cash Operating Margin Average Gross
Produced (1)
Sold
Realized
Cash Cost
($'s Per Ounce) (3)
Depletion
Margin
Price
($'s Per
($'s Per
($'s Per
($'s Per
Ounce) (2)
Ounce)
Ounce)
Ounce)
Gold equivalent basis (4) 473,868 460,026 $ 1,802 $ 448 $ 1,354 $ 389 $ 965
1) Quantity produced represents the amount of gold, silver, palladium and
cobalt contained in concentrate or doré prior to smelting or refining
deductions. Production figures are based on information provided by the
operators of the mining operations to which the mineral stream interests
relate or management estimates in those situations where other information is
not available. Certain production figures may be updated in future periods as
additional information is received.
2) Silver ounces produced and sold in thousands.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press
release.
4) Refer to discussion on non-IFRS measure (iv) at the end of this press
release.
5) GEOs, which are provided to assist the reader, are based on the
following commodity price assumptions: $1,850 per ounce gold; $24.00 per ounce
silver; $1,800 per ounce palladium; and $18.75 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2023.
Non-IFRS Measures
Wheaton has included, throughout this document, certain non-IFRS performance
measures, including (i) adjusted net earnings and adjusted net earnings per
share; (ii) operating cash flow per share (basic and diluted); (iii) average
cash costs of gold, silver and palladium on a per ounce basis and cobalt on a
per pound basis; and (iv) cash operating margin.
i. Adjusted net earnings and adjusted net earnings per share are
calculated by removing the effects of non-cash impairment charges (reversals)
(if any), non-cash fair value (gains) losses and other one-time (income)
expenses as well as the reversal of non-cash income tax expense (recovery)
which is offset by income tax expense (recovery) recognized in the Statements
of Shareholders' Equity and OCI, respectively. The Company believes that, in
addition to conventional measures prepared in accordance with IFRS, management
and certain investors use this information to evaluate the Company's
performance.
The following table provides a reconciliation of adjusted net earnings and
adjusted net earnings per share (basic and diluted).
Three Months Ended Nine Months Ended
September 30
September 30
(in thousands, except for per share amounts) 2023 2022 2023 2022
Net earnings $ 116,371 $ 196,460 $ 369,209 $ 503,001
Add back (deduct):
Impairment charge (reversal) - (10,330) - (10,330)
Gain on disposal of Mineral Stream Interest - (104,425) (5,027) (104,425)
(Gain) loss on fair value adjustment of share purchase warrants held 143 204 248 1,101
Income tax (expense) recovery recognized in the Statement of Shareholders' - 3,644 - 4,143
Equity
Income tax (expense) recovery recognized in the Statement of OCI 5,115 546 7,205 701
Income tax recovery related to prior year disposal of Mineral Stream Interest - 7,779 (2,672) 7,779
Other (162) - (482) (802)
Adjusted net earnings $ 121,467 $ 93,878 $ 368,481 $ 401,168
Divided by:
Basic weighted average number of shares outstanding 452,975 451,757 452,748 451,402
Diluted weighted average number of shares outstanding 453,538 452,386 453,419 452,221
Equals:
Adjusted earnings per share - basic $ 0.268 $ 0.208 $ 0.814 $ 0.889
Adjusted earnings per share - diluted $ 0.268 $ 0.208 $ 0.813 $ 0.887
ii. Operating cash flow per share (basic and diluted) is calculated by
dividing cash generated by operating activities by the weighted average number
of shares outstanding (basic and diluted). The Company presents operating cash
flow per share as management and certain investors use this information to
evaluate the Company's performance in comparison to other companies in the
precious metal mining industry who present results on a similar basis.
The following table provides a reconciliation of operating cash flow per share
(basic and diluted).
Three Months Ended Nine Months Ended
September 30
September 30
(in thousands, except for per share amounts) 2023 2022 2023 2022
Cash generated by operating activities $ 171,103 $ 154,497 $ 508,584 $ 571,396
Divided by:
Basic weighted average number of shares outstanding 452,975 451,757 452,748 451,402
Diluted weighted average number of shares outstanding 453,538 452,386 453,419 452,221
Equals:
Operating cash flow per share - basic $ 0.378 $ 0.342 $ 1.123 $ 1.266
Operating cash flow per share - diluted $ 0.377 $ 0.342 $ 1.122 $ 1.264
iii. Average cash cost of gold, silver and palladium on a per ounce basis
and cobalt on a per pound basis is calculated by dividing the total cost of
sales, less depletion, by the ounces or pounds sold. In the precious metal
mining industry, this is a common performance measure but does not have any
standardized meaning prescribed by IFRS. In addition to conventional measures
prepared in accordance with IFRS, management and certain investors use this
information to evaluate the Company's performance and ability to generate cash
flow.
The following table provides a calculation of average cash cost of gold,
silver and palladium on a per ounce basis and cobalt on a per pound basis.
Three Months Ended Nine Months Ended
September 30
September 30
(in thousands, except for gold and palladium ounces sold and per unit amounts) 2023 2022 2023 2022
Cost of sales $ 96,243 $ 116,683 $ 306,321 $ 384,703
Less: depletion (46,435) (55,728) (145,908) (178,812)
Cash cost of sales $ 49,808 $ 60,955 $ 160,413 $ 205,891
Cash cost of sales is comprised of:
Total cash cost of gold sold $ 33,014 $ 29,398 $ 98,724 $ 105,719
Total cash cost of silver sold 15,121 29,238 56,351 90,384
Total cash cost of palladium sold 946 1,493 2,699 4,475
Total cash cost of cobalt sold 727 826 2,639 5,313
Total cash cost of sales $ 49,808 $ 60,955 $ 160,413 $ 205,891
Divided by:
Total gold ounces sold 74,426 62,000 212,325 224,238
Total silver ounces sold 2,965 5,234 11,151 16,635
Total palladium ounces sold 4,242 4,227 10,580 11,680
Total cobalt pounds sold 198 115 786 851
Equals:
Average cash cost of gold (per ounce) $ 444 $ 474 $ 465 $ 471
Average cash cost of silver (per ounce) $ 5.10 $ 5.59 $ 5.05 $ 5.43
Average cash cost of palladium (per ounce) $ 223 $ 353 $ 255 $ 383
Average cash cost of cobalt (per pound) $ 3.66 $ 7.21 $ 3.36 $ 6.24
iv. Cash operating margin is calculated by adding back depletion to the
gross margin. Cash operating margin on a per ounce or per pound basis is
calculated by dividing the cash operating margin by the number of ounces or
pounds sold during the period. The Company presents cash operating margin as
management and certain investors use this information to evaluate the
Company's performance in comparison to other companies in the precious metal
mining industry who present results on a similar basis as well as to evaluate
the Company's ability to generate cash flow.
The following table provides a reconciliation of cash operating margin.
Three Months Ended Nine Months Ended
September 30
September 30
(in thousands, except for gold and palladium ounces sold and per unit amounts) 2023 2022 2023 2022
Gross margin $ 126,894 $ 102,153 $ 396,252 $ 444,299
Add back: depletion 46,435 55,728 145,908 178,812
Cash operating margin $ 173,329 $ 157,881 $ 542,160 $ 623,111
Cash operating margin is comprised of:
Total cash operating margin of gold sold $ 111,693 $ 77,730 $ 314,690 $ 304,927
Total cash operating margin of silver sold 55,251 71,032 206,778 274,445
Total cash operating margin of palladium sold 4,361 7,345 12,223 21,099
Total cash operating margin of cobalt sold 2,024 1,774 8,469 22,640
Total cash operating margin $ 173,329 $ 157,881 $ 542,160 $ 623,111
Divided by:
Total gold ounces sold 74,426 62,000 212,325 224,238
Total silver ounces sold 2,965 5,234 11,151 16,635
Total palladium ounces sold 4,242 4,227 10,580 11,680
Total cobalt pounds sold 198 115 786 851
Equals:
Cash operating margin per gold ounce sold $ 1,500 $ 1,254 $ 1,482 $ 1,360
Cash operating margin per silver ounce sold $ 18.63 $ 13.57 $ 18.55 $ 16.50
Cash operating margin per palladium ounce sold $ 1,028 $ 1,738 $ 1,155 $ 1,807
Cash operating margin per cobalt pound sold $ 10.21 $ 15.47 $ 10.77 $ 26.61
These non-IFRS measures do not have any standardized meaning prescribed by
IFRS, and other companies may calculate these measures differently. The
presentation of these non-IFRS measures is intended to provide additional
information and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. For more detailed
information, please refer to Wheaton's MD&A available on the Company's
website at www.wheatonpm.com and posted on SEDAR+ at www.sedarplus.ca.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of
the United States Private Securities Litigation Reform Act of 1995 and
"forward-looking information" within the meaning of applicable Canadian
securities legislation concerning the business, operations and financial
performance of Wheaton and, in some instances, the business, mining operations
and performance of Wheaton's PMPA counterparties. Forward-looking statements,
which are all statements other than statements of historical fact, include,
but are not limited to, statements with respect to the payment of $115 million
to Waterton Copper and the satisfaction of each party's obligations in
accordance with the Mineral Park PMPA and the receipt of silver production in
respect of the Mineral Park Mine, the future price of commodities, the
estimation of future production from Mining Operations (including in the
estimation of production, mill throughput, grades, recoveries and exploration
potential), the estimation of mineral reserves and mineral resources
(including the estimation of reserve conversion rates) and the realization of
such estimations, the commencement, timing and achievement of construction,
expansion or improvement projects by Wheaton's PMPA counterparties at mineral
stream interests owned by Wheaton (the "Mining Operations"), the payment of
upfront cash consideration to counterparties under PMPAs, the satisfaction of
each party's obligations in accordance with PMPAs and royalty arrangements and
the receipt by the Company of precious metals and cobalt production in respect
of the applicable Mining Operations under PMPAs or other payments under
royalty arrangements, the ability of Wheaton's PMPA counterparties to comply
with the terms of a PMPA (including as a result of the business, mining
operations and performance of Wheaton's PMPA counterparties) and the potential
impacts of such on Wheaton, future payments by the Company in accordance with
PMPAs, the costs of future production, the estimation of produced but not yet
delivered ounces, the impact of epidemics (including the COVID-19 virus
pandemic), including the potential heightening of other risks, future sales of
common shares under the ATM program, continued listing of the Company's common
shares, any statements as to future dividends, the ability to fund outstanding
commitments and the ability to continue to acquire accretive PMPAs, including
any acceleration of payments, projected increases to Wheaton's production and
cash flow profile, projected changes to Wheaton's production mix, the ability
of Wheaton's PMPA counterparties to comply with the terms of any other
obligations under agreements with the Company, the ability to sell precious
metals and cobalt production, confidence in the Company's business structure,
the Company's assessment of taxes payable and the impact of the CRA
Settlement, possible domestic audits for taxation years subsequent to 2016 and
international audits, the Company's assessment of the impact of any tax
reassessments, the Company's intention to file future tax returns in a manner
consistent with the CRA Settlement, the Company's climate change and
environmental commitments, and assessments of the impact and resolution of
various legal and tax matters, including but not limited to audits. Generally,
these forward-looking statements can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not expect",
"is expected", "budget", "scheduled", "estimates", "forecasts", "projects",
"intends", "anticipates" or "does not anticipate", or "believes", "potential",
or variations of such words and phrases or statements that certain actions,
events or results "may", "could", "would", "might" or "will be taken", "occur"
or "be achieved". Forward-looking statements are subject to known and unknown
risks, uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of Wheaton to be materially
different from those expressed or implied by such forward-looking statements,
including but not limited to risks related to the satisfaction of each party's
obligations in accordance with the terms of the Mineral Park PMPA, the
satisfaction of each party's obligations in accordance with the terms of the
Company's PMPAs or royalty arrangements, risks associated with fluctuations in
the price of commodities (including Wheaton's ability to sell its precious
metals or cobalt production at acceptable prices or at all), risks related to
the Mining Operations (including fluctuations in the price of the primary or
other commodities mined at such operations, regulatory, political and other
risks of the jurisdictions in which the Mining Operations are located, actual
results of mining, risks associated with the exploration, development,
operating, expansion and improvement of the Mining Operations, environmental
and economic risks of the Mining Operations, and changes in project parameters
as plans continue to be refined), the absence of control over the Mining
Operations and having to rely on the accuracy of the public disclosure and
other information Wheaton receives from the Mining Operations, uncertainty in
the estimation of production from Mining Operations, uncertainty in the
accuracy of mineral reserve and mineral resource estimation, risks of
significant impacts on Wheaton or the Mining Operations as a result of an
epidemic (including the COVID-19 virus pandemic), the ability of each party to
satisfy their obligations in accordance with the terms of the PMPAs, the
estimation of future production from Mining Operations, Wheaton's
interpretation of, compliance with or application of, tax laws and regulations
or accounting policies and rules being found to be incorrect, any challenge or
reassessment by the CRA of the Company's tax filings being successful and the
potential negative impact to the Company's previous and future tax filings,
assessing the impact of the CRA Settlement (including whether there will be
any material change in the Company's facts or change in law or jurisprudence),
potential amendments to Canada's transfer pricing rules under the Income Tax
Act (Canada) that may result from the Department of Finance's consultation
paper released June 6, 2023, potential implementation of a 15% global
minimum tax, including the draft legislation issued for consultation by the
Canadian Federal Government on August 4, 2023 that would apply to the income
of the Company's non-Canadian subsidiaries; counterparty credit and liquidity,
mine operator concentration, indebtedness and guarantees, hedging,
competition, claims and legal proceedings against Wheaton or the Mining
Operations, security over underlying assets, governmental regulations,
international operations of Wheaton and the Mining Operations, exploration,
development, operations, expansions and improvements at the Mining Operations,
environmental regulations, climate change, Wheaton and the Mining Operations
ability to obtain and maintain necessary licenses, permits, approvals and
rulings, Wheaton and the Mining Operations ability to comply with applicable
laws, regulations and permitting requirements, lack of suitable supplies,
infrastructure and employees to support the Mining Operations, inability to
replace and expand mineral reserves, including anticipated timing of the
commencement of production by certain Mining Operations (including increases
in production, estimated grades and recoveries), uncertainties of title and
indigenous rights with respect to the Mining Operations, environmental, social
and governance matters, Wheaton and the Mining Operations ability to obtain
adequate financing, the Mining Operations ability to complete permitting,
construction, development and expansion, global financial conditions,
Wheaton's acquisition strategy and other risks discussed in the section
entitled "Description of the Business - Risk Factors" in Wheaton's Annual
Information Form available on SEDAR+ at www.sedarplus.ca
(http://www.sedarplus.ca) and Wheaton's Form 40-F for the year ended December
31, 2022 on file with the U.S. Securities and Exchange Commission on EDGAR
(the "Disclosure"). Forward-looking statements are based on assumptions
management currently believes to be reasonable, including (without
limitation): the payment of $115 million to Waterton Copper and the
satisfaction of each party's obligations in accordance with the terms of the
Mineral Park PMPA, that there will be no material adverse change in the market
price of commodities, that the Mining Operations will continue to operate and
the mining projects will be completed in accordance with public statements and
achieve their stated production estimates, that the mineral reserves and
mineral resource estimates from Mining Operations (including reserve
conversion rates) are accurate, that each party will satisfy their obligations
in accordance with the PMPAs, that Wheaton will continue to be able to fund or
obtain funding for outstanding commitments, that Wheaton will be able to
source and obtain accretive PMPAs, that neither Wheaton nor the Mining
Operations will suffer significant impacts as a result of an epidemic
(including the COVID-19 virus pandemic), that any outbreak or threat of an
outbreak of a virus or other contagions or epidemic disease will be adequately
responded to locally, nationally, regionally and internationally, without such
response requiring any prolonged closure of the Mining Operations or having
other material adverse effects on the Company and counterparties to its PMPAs,
that the trading of the Company's common shares will not be adversely affected
by the differences in liquidity, settlement and clearing systems as a result
of multiple listings of the Common Shares on the LSE, the TSX and the NYSE,
that the trading of the Company's common shares will not be suspended, and
that the net proceeds of sales of common shares, if any, will be used as
anticipated, that expectations regarding the resolution of legal and tax
matters will be achieved (including ongoing CRA audits involving the Company),
that Wheaton has properly considered the interpretation and application of
Canadian tax law to its structure and operations, that Wheaton has filed its
tax returns and paid applicable taxes in compliance with Canadian tax law,
that Wheaton's application of the CRA Settlement is accurate (including the
Company's assessment that there will be no material change in the Company's
facts or change in law or jurisprudence), and such other assumptions and
factors as set out in the Disclosure. There can be no assurance that
forward-looking statements will prove to be accurate and even if events or
results described in the forward-looking statements are realized or
substantially realized, there can be no assurance that they will have the
expected consequences to, or effects on, Wheaton. Readers should not place
undue reliance on forward-looking statements and are cautioned that actual
outcomes may vary. The forward-looking statements included herein are for the
purpose of providing readers with information to assist them in understanding
Wheaton's expected financial and operational performance and may not be
appropriate for other purposes. Any forward-looking statement speaks only as
of the date on which it is made, reflects Wheaton's management's current
beliefs based on current information and will not be updated except in
accordance with applicable securities laws. Although Wheaton has attempted to
identify important factors that could cause actual results, level of activity,
performance or achievements to differ materially from those contained in
forward‑looking statements, there may be other factors that cause results,
level of activity, performance or achievements not to be as anticipated,
estimated or intended.
Cautionary Language Regarding Reserves and Resources
For further information on Mineral Reserves and Mineral Resources and on
Wheaton more generally, readers should refer to Wheaton's Annual Information
Form for the year ended December 31, 2022, which was filed on March 31, 2023
and other continuous disclosure documents filed by Wheaton since January 1,
2023, available on SEDAR+ at www.sedarplus.ca. Wheaton's Mineral Reserves and
Mineral Resources are subject to the qualifications and notes set forth
therein. Mineral Resources, which are not Mineral Reserves, do not have
demonstrated economic viability.
Cautionary Note to United States Investors Concerning Estimates of Measured,
Indicated and Inferred Resources: The information contained herein has been
prepared in accordance with the requirements of the securities laws in effect
in Canada, which differ from the requirements of United States securities
laws. The Company reports information regarding mineral properties,
mineralization and estimates of mineral reserves and mineral resources in
accordance with Canadian reporting requirements which are governed by, and
utilize definitions required by, Canadian National Instrument 43-101 -
Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian
Institute of Mining, Metallurgy and Petroleum (the "CIM") - CIM Definition
Standards on Mineral Resources and Mineral Reserves, adopted by the CIM
Council, as amended (the "CIM Standards"). These definitions differ from the
definitions adopted by the United States Securities and Exchange Commission
("SEC") under the United States Securities Act of 1933, as amended (the
"Securities Act") which are applicable to U.S. companies. Accordingly, there
is no assurance any mineral reserves or mineral resources that the Company may
report as "proven mineral reserves", "probable mineral reserves", "measured
mineral resources", "indicated mineral resources" and "inferred mineral
resources" under NI 43-101 would be the same had the Company prepared the
reserve or resource estimates under the standards adopted by the SEC.
Accordingly, information contained herein that describes Wheaton's mineral
deposits may not be comparable to similar information made public by U.S.
companies subject to reporting and disclosure requirements under the United
States federal securities laws and the rules and regulations thereunder.
United States investors are urged to consider closely the disclosure in
Wheaton's Form 40-F, a copy of which may be obtained from Wheaton or from
https://www.sec.gov/edgar.shtml (https://www.sec.gov/edgar.shtml) .
1 (#_ednref1) Please refer to non-IFRS measures at the end of this press
release. Dividends declared in the referenced calendar quarter, relative to
the financial results of the prior quarter. Details of the dividend can be
found in the Wheaton's news release date November 9, 2023, titled "Wheaton
Precious Metals Declares Quarterly Dividend."
2 (#_ednref2) Statements made in this section contain forward-looking
information with respect to forecast production, funding outstanding
commitments and continuing to acquire accretive mineral stream interests and
readers are cautioned that actual outcomes may vary. Please see "Cautionary
Note Regarding Forward-Looking Statements" for material risks, assumptions and
important disclosure associated with this information.
3 (#_ednref3) Company reports & S and P Capital IQ est. of 2022
byproduct cost curves for gold, zinc/lead, copper, PGM, nickel & silver
mines. GEOs relating to production and guidance, which are provided to assist
the reader, are based on the following commodity price assumptions: gold
$1,850/oz, silver $24/oz, palladium $1,800/oz, platinum $1,100/oz and cobalt
$18.75/lb. Five-year and ten-year guidance does not include any production
from Pascua-Lama, Navidad, Cotabambas, Metates or additional expansions at
Salobo outside of the Salobo III expansion. In addition, five-year guidance
also does not include any production from Kutcho, or the Victor project at
Sudbury. Additionally, none of the deals announced in 2023 have been factored
into 2023 or longer-term guidance including the Blackwater extension,
Cangrejos and Mineral Park Projects, and the Black Pine Royalty. Ounces
produced represent the quantity of silver, gold, palladium and cobalt
contained in concentrate or doré prior to smelting or refining deductions.
4 (#_ednref4) Portfolio mine life based on recoverable reserves and
resources as of Dec 31, 2022 and 2022 actual mill throughput and is weighted
by individual reserve and resource category.
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