REG - Wheaton Precious Met - 1st Quarter Results
10/05/2024 07:00
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RNS Number : 9380N Wheaton Precious Metals Corp. 10 May 2024
May 10, 2024
Vancouver, British Columbia
Designated News Release
first QUARTER FINANCIAL results
Wheaton Precious Metals Announces First Quarter 2024 Results
"Wheaton delivered a robust quarter to start the year, generating over $219
million in operating cash flows, and underscoring the effectiveness of our
business model in leveraging rising commodity prices while maintaining strong
cash operating margins," said Randy Smallwood, President and Chief Executive
Officer of Wheaton Precious Metals. "Looking ahead, we continue to forecast
peer-leading production growth of 40% by 2028, buoyed by several development
projects in our portfolio, many of which achieved significant milestones
during the quarter. Building on the momentum from a record eight acquisitions
in 2023, our corporate development team remains actively engaged in evaluating
new opportunities and as always, Wheaton remains committed to ensuring that
our growth is both accretive and sustainable for all stakeholders. We believe
that strong commodity price trends and our sector leading growth profile
provide Wheaton shareholders with one of the best vehicles for investing into
the gold and precious metals space."
Solid Financial Results and Strong Balance Sheet
· First quarter of 2024: $297 million in revenue, $219 million in
operating cash flow, $164 million in net earnings and $164 million in adjusted
net earnings 1 (#_edn1) and, declared a quarterly dividend(1) of $0.155 per
common share.
· Balance Sheet: cash balance of $306 million, no debt, and an undrawn $2
billion revolving credit facility as at March 31, 2024, after making total
upfront cash payments of $462 million relative to mineral stream and royalty
interests in the quarter.
High-Quality Asset Base
· Streaming and royalty agreements on 18 operating mines and 27
development projects(5).
· 93% of attributable production from assets in the lowest half of their
respective cost curves 2 (#_edn2) (,4).
· Attributable gold equivalent production(3) of 160,100 ounces in the
first quarter of 2024, an increase of 19% relative to the comparable period of
the prior year due primarily to the mill throughput expansion at Salobo and
higher production at Constancia due to the mining of the high-grade zones of
the Pampacancha deposit.
· Forecasting annual production of over 800,000 gold equivalent ounces
("GEOs") by 2028, with average annual attributable production growing to over
850,000 GEOs(3) in years 2029 to 2033.
· Accretive portfolio growth:
o On February 27, 2024, the Company closed the previously announced
agreement with certain entities advised by Orion Resource Partners to acquire
existing PMPAs in respect of Ivanhoe Mines' Platreef project and BMC Minerals'
Kudz Ze Kayah project.
o On February 20, 2024, the Company acquired a 1.5% Net Smelter Royalty from
Integra Resources Corporation on the DeLamar and Florida Mountain project.
Leadership in Sustainability
· Top Rankings: Ranked in the Global Top 50 out of over 15,000 multi-sector
companies by Sustainalytics, AA rated by MSCI, and Prime rated by ISS.
· Recognized among Corporate Knights' 2024 100 most sustainable
corporations in the world.
· Peer-leading community investment program that supports social and
environmental initiatives alongside Wheaton's mining partners.
Operational Overview
(all figures in US dollars unless otherwise noted) Q1 2024 Q1 2023 Change
Units produced
Gold ounces 93,370 73,019 27.9 %
Silver ounces 5,476 5,134 6.7 %
Palladium ounces 4,463 3,705 20.5 %
Cobalt pounds 240 124 93.1 %
Gold equivalent ounces (3) 160,133 134,730 18.9 %
Units sold
Gold ounces 92,019 62,605 47.0 %
Silver ounces 4,067 3,749 8.5 %
Palladium ounces 4,774 2,946 62.1 %
Cobalt pounds 309 323 (4.3)%
Gold equivalent ounces (3) 143,184 109,293 31.0 %
Change in PBND and Inventory
Gold equivalent ounces (3) 2,102 11,756 9,654
Revenue $ 296,806 $ 214,465 38.4 %
Net earnings $ 164,041 $ 111,391 47.3 %
Per share $ 0.362 $ 0.246 47.2 %
Adjusted net earnings (1) $ 163,589 $ 104,431 56.6 %
Per share (1) $ 0.361 $ 0.231 56.3 %
Operating cash flows $ 219,380 $ 135,104 62.4 %
Per share (1) $ 0.484 $ 0.299 61.9 %
All amounts in thousands except gold, palladium & gold equivalent ounces,
and per share amounts.
Financial Review
Revenues
Revenue in the first quarter of 2024 was $297 million (64% gold, 32% silver,
2% palladium and 2% cobalt), with the $82 million increase relative to the
prior period quarter being primarily due to a 31% increase in the number of
GEOs³ sold; and a 6% increase in the average realized gold equivalent³
price.
Cash Costs and Margin
Average cash costs¹ in the first quarter of 2024 were $430 per GEO³ as
compared to $475 in the first quarter of 2023. This resulted in a cash
operating margin¹ of $1,643 per GEO³ sold, an increase of 10% as compared
with the first quarter of 2023, a result of the higher realized price per
ounce coupled with the lower average cash costs.
Cash Flow from Operations
Operating cash flow in the first quarter of 2024 amounted to $219 million,
with the $84 million increase due primarily to the higher gross margin.
Balance Sheet (at March 31, 2024)
· Approximately $306 million of cash on hand
· During the first quarter of 2024, the Company made total upfront cash
payments of $462 million relative to the mineral stream and royalty interests
consisting of:
o $450 million relative to the Platreef and Kudz Ze Kayah precious metals
purchase agreements ("PMPAs")
o $7 million relative to the Mt Todd Royalty; and
o $5 million relative to the DeLamar Royalty
· Subsequent to the quarter, the Company disposed of its investment in
Hecla Mining Company for gross proceeds of $177 million.
· With the existing cash on hand coupled with the fully undrawn $2
billion revolving credit facility, the Company believes it is well positioned
to fund all outstanding commitments and known contingencies as well as
providing flexibility to acquire additional accretive mineral stream
interests.
Global Minimum Tax
The Company is within the scope of global minimum tax ("GMT") under the OECD
Pillar Two model rules ("Pillar Two"), under which large multinational
entities will be subject to a 15% GMT. On May 2, 2024, the Canadian Federal
Government introduced the Federal budget bill, C-69, into parliament which
contains the Global Minimum Tax Act ("GMTA") reflecting application of GMT to
in-scope companies for fiscal years commencing on or after December 31, 2023.
However, as of the date of this press release , the legislation related to the
GMTA has not been enacted. As the legislation was not enacted as of the
Balance Sheet date, for the three months ended March 31, 2024, the Company has
recorded no current tax expense associated with GMT, although the Company's
wholly-owned foreign subsidiaries which reside in jurisdictions where the GMT
is expected to apply had net earnings of $165 million with 15% of such
amounting to $25 million.
The Company will recognize the tax expense associated with the GMT in its
consolidated financial statements in the appropriate period relative to when
the legislation is enacted. If enacted as drafted, Company's wholly-owned
foreign subsidiaries which reside in jurisdictions where the GMT is expected
to apply would be subject to the proposed Canadian rules in the GMTA
retroactively to January 1, 2024.
First Quarter Operating Asset Highlights(2)
Salobo: In the first quarter of 2024, Salobo produced 61,600 ounces of
attributable gold, an increase of approximately 41% relative to the first
quarter of 2023, driven by higher throughput, with production from the third
concentrator line commencing at the end of 2022, partially offset by lower
grades which was expected as per the mine development plan. As reported by
Vale S.A. ("Vale"), Salobo 3 reached ~90% average throughput in the first
quarter as the ramp-up continues. Salobo 1 & 2 plants also posted strong
performance in the quarter, with 14% higher throughput rate, 10% productivity
and 3% higher asset availability relative to the first quarter of 2023.
On November 21, 2023, Vale reported the successful completion of the
throughput test for the first phase of the Salobo III project, with the Salobo
complex exceeding an average of 32 million tonnes per annum ("Mtpa") over a
90-day period. Under the terms of the agreement, the Company paid Vale $370
million for the completion of the first phase of the Salobo III expansion
project on December 1, 2023. The remaining balance of the expansion payment is
dependent on the timing of completion and will be triggered once Vale expands
actual throughput above 35 Mtpa for a period of 90 days.
Antamina: In the first quarter of 2024, Antamina produced 0.8 million ounces
of attributable silver, a decrease of approximately 8% relative to the first
quarter of 2023 primarily due to lower grades. On February 15, 2024, Peru's
National Environmental Certification Service for Sustainable Investments
approved, after a detailed evaluation process, the Modification of the
Environmental Impact Study, which will allow for the extension of Antamina's
mine life from 2028 to 2036.
Peñasquito: In the first quarter of 2024, Peñasquito produced 2.6 million
ounces of attributable silver, an increase of approximately 27% relative to
the first quarter of 2023 primarily due to higher grades.
Constancia: In the first quarter of 2024, Constancia produced 0.6 million
ounces of attributable silver and 13,900 ounces of attributable gold, an
increase of approximately 16% and 101%, respectively, relative to the first
quarter of 2023, with the increases being primarily the result of
significantly higher gold grades attributable to the mining of high-grade
zones of the Pampacancha deposit, combined with higher recoveries.
On March 28, 2024, Hudbay Minerals Inc., ("Hudbay") reported that Constancia's
expected mine life has been extended by three years to 2041 as a result of the
successful conversion of mineral resources to mineral reserves with the
addition of a further mining phase at the Constancia pit following positive
geotechnical drilling and studies in 2023. There remains potential for future
mine life extensions based on the mineral resources that have not yet been
converted to mineral reserves.
Sudbury: In the first quarter of 2024, Vale's Sudbury mines produced 7,000
ounces of attributable gold, an increase of approximately 14% relative to the
first quarter of 2023, due to higher throughput.
Stillwater: In the first quarter of 2024, the Stillwater mines produced 2,600
ounces of attributable gold and 4,500 ounces of attributable palladium, an
increase of approximately 35% for gold and 20% for palladium relative to the
first quarter of 2023, due primarily to higher throughput and grades.
Voisey's Bay: In the first quarter of 2024, the Voisey's Bay mine produced
240,000 pounds of attributable cobalt, an increase of approximately 93%
relative to the first quarter of 2023, as the transitional period between the
depletion of the Ovoid open-pit and ramp-up to full production of the Voisey's
Bay underground mine nears completion. Vale reports that physical completion
of the Voisey's Bay underground mine extension was 94% at the end of the first
quarter, and that the main surface assets are completed and already operating.
In the underground portion, the scope in Reid Brook is completed and the mine
development at Eastern Deeps is concluded. Construction of the Bulk Material
Handling system, dewatering and support facilities is ongoing. The full mine
assets at Eastern Deeps are expected to be in operation by the end of 2024.
Other Gold: In the first quarter of 2024, total Other Gold attributable
production was 600 ounces, a decrease of approximately 82% relative to the
first quarter of 2023, primarily due to the closure of the Minto mine in May
2023.
Other Silver: In the first quarter of 2024, total Other Silver attributable
production was 1.4 million ounces, a decrease of approximately 15% relative to
the first quarter of 2023, primarily due to the temporary suspension of
attributable production from Aljustrel.
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.
Recent Development Asset Updates
Blackwater Project: On February 21, 2024, Artemis Gold Inc. ("Artemis")
announced the results of an expansion study to optimize the timing of mine
expansion through the advancing of Phase 2. A decision on the acceleration of
the Phase 2 expansion is expected to be considered in the second half of 2024.
On April 24, 2024, Artemis announced that overall construction was
approximately 73% complete and that construction of major site water
management facilities, including the water management pond, the central
diversion system, and the Davidson Creek diversion, have been completed along
with work on the tailings storage facility which is progressing well. Artemis
also states that the project remains on schedule for first gold pour in the
second half of 2024.
Platreef Project: On April 30, 2024, Ivanhoe Mines Ltd. ("Ivanhoe") reported
that construction activities for the Platreef Phase 1 concentrator are on
schedule at almost 90% complete and on track for cold commissioning in the
third quarter of 2024. An updated independent feasibility study on an
optimized development plan for the acceleration of Phase 2 is planned to be
completed and published in the fourth quarter of 2024. As a result of the
planned acceleration of Phase 2, first feed and ramp-up of production will be
deferred until mid-2025. In addition, a preliminary economic assessment on a
Phase 3 expansion is expected to be completed at the same time, increasing
Platreef's processing capacity up to approximately 10 Mtpa. A Phase 3
expansion to 10 Mtpa processing capacity is expected to rank Platreef as one
of the world's largest platinum-group metal, nickel, copper and gold
producers.
Goose Project: On May 7, 2024, B2Gold Corp., ("B2Gold") announced the
successful completion of the 2024 winter ice road ("WIR") campaign, delivering
all necessary materials to complete the construction of the Goose project.
B2Gold reports that while mill construction remains on schedule, development
of the open pit and underground is slightly behind schedule due to equipment
availability, adverse weather conditions and prioritization of critical path
construction activities. As a result, B2Gold reports that first gold pour is
now expected in the second quarter of 2025 with ramp up to full production in
the third quarter of 2025, one quarter later than previous estimates.
Marmato Mine: On April 15, 2024, Aris Mining Corporation ("Aris") provided an
update that at the Marmato Lower Mine expansion project, the access road to
the new processing facility area is now complete and earthworks in the plant
area will commence soon. The contractor for the new portal and decline is
fully mobilized and cutting of the portal face has commenced.
Curipamba Project: On January 22, 2024, Adventus Mining Corporation
("Adventus") announced that the Ministry of Environment, Water and Energy
Transition of the Government of Ecuador has granted the environmental license
for the construction and operation of the El Domo - Curipamba project (the
"Curipamba project"). On January 30, 2024, Adventus announced that the
Ministry of Energy and Mines of Ecuador has issued a permit which grants
approval for the design, construction, operation, and maintenance of the
tailings storage facility ("TSF") for the Curipamba project. The start of TSF
construction is a key condition precedent for the Company to make additional
upfront cash payments under the Curipamba PMPA.
On April 26, 2024, Adventus announced that Silvercorp Metals Inc.
("Silvercorp") has entered into a definitive arrangement agreement with
Adventus pursuant to which Silvercorp has agreed to acquire all of the issued
and outstanding common shares of Adventus. As reported by Silvercorp, the
existing stream with Wheaton, combined with Silvercorp's existing cash and
cash equivalents of approximately $200 million, is more than sufficient to
fully fund the Curipamba project through construction.
Fenix Project: On April 8, 2024, Rio2 Limited ("Rio2") announced that its
Chilean subsidiary has received the formal Environmental Qualification
Resolution ("RCA") for the Fenix gold project. The receipt of the RCA now
allows Rio2 to advance permitting activities for the Fenix project. Rio2 has
noted that there are four principal Sectorial Permits required before
construction can commence at the Project: 1) Mining Methods; 2) Process Plant;
3) Waste Dumps & Stockpiles; and 4) Closure Plan and that work on these
permits is well underway. Rio2 notes that the current timing for receipt of
these principal permits is by the end of July 2024.
Cangrejos Project: On January 18, 2024, Lumina Gold Corp. ("Lumina") announced
results from the phase 1 mining resource conversion drilling campaign in
support of the ongoing feasibility study at Cangrejos. Lumina noted that the
assays from the resource infill program continue to demonstrate the
exceptional continuity of grade at Cangrejos. Lumina also noted that it is
operating normally at the Cangrejos project and to date their activities have
not been affected by the recent civil disturbances that have impacted other
areas in Ecuador.
Curraghinalt Project: Subsequent to the quarter, the Planning Appeals
Commission & Water Appeals Commission ("the commission") in Northern
Ireland concluded that the water abstraction and impoundment licenses ("water
licenses") relative to the Curraghinalt Project have been rescinded and that
license applications would need to be resubmitted and subsequent public
inquiry referrals held. The commission noted that it has suspended
arrangements for the current inquiry timetable until it is in receipt of the
expected water license applications, at which time it will move to set
directions and new dates for the submission of statements of case, rebuttals,
and for the opening of the re-scheduled hearing sessions in due course.
Corporate Development
DeLamar Royalty
On February 20, 2024, the Company purchased a 1.5% net smelter return royalty
interest ("DeLamar Royalty") in the DeLamar and Florida mountain project
located in Idaho, United States (the "DeLamar project") from a subsidiary of
Integra Resources Corporation ("Integra") for $9.75 million to be paid in two
equal installments, the first of which was paid in the first quarter of 2024,
with the balance expected to be paid in July 2024 subject to customary
conditions. Under the DeLamar Royalty, if completion is not achieved by
January 1, 2029, the DeLamar Royalty will increase annually by 0.15% of net
smelter returns to a maximum of 2.7% of net smelter returns. The Company had
previously acquired a right of first refusal on any precious metals streaming,
royalty, pre-pay or other similar transaction on the DeLamar project.
Sustainability
Ratings & Awards:
· On January 17, 2024, the Company announced its ranking among Corporate
Knights' 2024 100 Most Sustainable Corporations in the world. The Company will
be included in the Global 100 Index, which represents a benchmark for
sustainability excellence.
Community Investment Program:
· On March 1, 2024, Wheaton International commenced a new program with
the Vale Foundation to support an ambitious three-year initiative in Brazil
that aims to improve the primary health care being offered in the
municipalities near the Salobo mine and along the Carajas railroad. The
program will be carried out in 8 municipalities of Pará State, impacting
approximately 550,000 individuals and in 24 municipalities of Maranhão State,
impacting approximately 1.3 million individuals. Wheaton International and the
Vale Foundation each committed BRL$17 million. The total contribution of
Wheaton and the Vale Foundation of BRL$34 million is being matched by the
Brazilian Development Bank, magnifying the impact of the contribution being
made by Wheaton International.
· The Pacific Salmon Foundation's Vancouver Gala presented by Wheaton
raised CA$0.5 million in support of advancing critical marine science research
and conservation work.
· The Daffodil Ball presented by Wheaton raised over CA$4.4 million for
the Canadian Cancer Society.
2024 and Long-Term Production Outlook
Wheaton's estimated attributable production in 2024 is forecast to be 325,000
to 370,000 ounces of gold, 18.5 to 20.5 million ounces of silver, and 12,000
to 15,000 GEOs(3) of other metals, resulting in annual production of
approximately 550,000 to 620,000 GEOs(3), unchanged from previous
guidance(2,3).
Annual production is forecast to increase by approximately 40% to over 800,000
GEOs(3) by 2028, with average annual production forecast to grow to over
850,000 GEO(3) in years 2029 to 2033, also unchanged from previous guidance.
About Wheaton Precious Metals Corp.
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.
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, May 10, 2024, starting at 8:00am PT
(11:00 am ET) to discuss these results. To participate in the live call please
use one of the following methods:
RapidConnect URL: Click here (https://emportal.ink/3uotAaA)
Live webcast: Click here (https://app.webinar.net/AGkexzXRE6Z)
Dial toll free: 1-888-664-6383 or 1-416-764-8650
Conference Call ID: 12432661
Participants should dial in five to ten minutes before the call.
The conference call will be recorded and available until May 17, 2024 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: 432661 #
Archived webcast Click here (https://app.webinar.net/AGkexzXRE6Z)
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
Condensed Interim Consolidated Statements of Earnings
Three Months Ended
March 31
(US dollars and shares in thousands, except per share amounts - unaudited) 2024 2023
Sales $ 296,806 $ 214,465
Cost of sales
Cost of sales, excluding depletion $ 61,555 $ 51,964
Depletion 63,676 45,000
Total cost of sales $ 125,231 $ 96,964
Gross margin $ 171,575 $ 117,501
General and administrative expenses 10,464 10,099
Share based compensation 1,281 7,397
Donations and community investments 1,570 1,378
Earnings from operations $ 158,260 $ 98,627
Other income (expense) 7,196 7,562
Earnings before finance costs and income taxes $ 165,456 $ 106,189
Finance costs 1,442 1,378
Earnings before income taxes $ 164,014 $ 104,811
Income tax recovery (27) (6,580)
Net earnings $ 164,041 $ 111,391
Basic earnings per share $ 0.362 $ 0.246
Diluted earnings per share $ 0.362 $ 0.246
Weighted average number of shares outstanding
Basic 453,094 452,370
Diluted 453,666 453,159
Condensed Interim Consolidated Balance Sheets
As at As at
March 31
December 31
(US dollars in thousands - unaudited) 2024 2023
Assets
Current assets
Cash and cash equivalents $ 306,109 $ 546,527
Accounts receivable 5,514 10,078
Cobalt inventory - 1,372
Income taxes receivable 5,851 5,935
Other 3,374 3,499
Total current assets $ 320,848 $ 567,411
Non-current assets
Mineral stream interests $ 6,510,767 $ 6,122,441
Early deposit mineral stream interests 47,094 47,093
Mineral royalty interests 25,448 13,454
Long-term equity investments 246,652 246,678
Property, plant and equipment 7,996 7,638
Other 21,650 26,470
Total non-current assets $ 6,859,607 $ 6,463,774
Total assets $ 7,180,455 $ 7,031,185
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 10,918 $ 13,458
Dividends payable 70,261 -
Current portion of performance share units 6,261 12,013
Current portion of lease liabilities 518 604
Total current liabilities $ 87,958 $ 26,075
Non-current liabilities
Performance share units $ 2,991 $ 9,113
Lease liabilities 5,423 5,625
Deferred income taxes 242 232
Pension liability 4,646 4,624
Total non-current liabilities $ 13,302 $ 19,594
Total liabilities $ 101,260 $ 45,669
Shareholders' equity
Issued capital $ 3,784,848 $ 3,777,323
Reserves (47,717) (40,091)
Retained earnings 3,342,064 3,248,284
Total shareholders' equity $ 7,079,195 $ 6,985,516
Total liabilities and shareholders' equity $ 7,180,455 $ 7,031,185
Condensed Interim Consolidated Statements of Cash Flows
Three Months Ended
March 31
(US dollars in thousands - unaudited) 2024 2023
Operating activities
Net earnings $ 164,041 $ 111,391
Adjustments for
Depreciation and depletion 64,013 45,390
Interest expense 74 17
Equity settled stock based compensation 1,598 1,542
Performance share units - expense (317) 5,855
Performance share units - paid (11,129) (16,675)
Pension expense 175 167
Pension paid (43) (96)
Income tax (recovery) expense (27) (6,580)
(Gain) loss on fair value adjustment of share purchase warrants held (183) (175)
Investment income recognized in net earnings (6,438) (7,148)
Other (83) 79
Change in non-cash working capital 2,155 (2,072)
Cash generated from operations before income taxes and interest $ 213,836 $ 131,695
Income taxes paid (116) (3,344)
Interest paid (75) (18)
Interest received 5,735 6,771
Cash generated from operating activities $ 219,380 $ 135,104
Financing activities
Share purchase options exercised 3,816 9,376
Lease payments (148) (202)
Cash generated from financing activities $ 3,668 $ 9,174
Investing activities
Mineral stream interests $ (450,902) $ (31,524)
Early deposit mineral stream interests - (750)
Mineral royalty interest (11,947) -
Net proceeds on disposal of mineral stream interests - (29)
Acquisition of long-term investments (751) (8,144)
Dividends received 700 -
Other (596) (530)
Cash used for investing activities $ (463,496) $ (40,977)
Effect of exchange rate changes on cash and cash equivalents $ 30 $ 307
(Decrease) increase in cash and cash equivalents $ (240,418) $ 103,608
Cash and cash equivalents, beginning of period 546,527 696,089
Cash and cash equivalents, end of period $ 306,109 $ 799,697
Summary of Units Produced
Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022
Gold ounces produced ²
Salobo 61,622 71,778 69,045 54,804 43,677 37,939 44,212 34,129
Sudbury (3) 7,049 5,823 3,857 5,818 6,203 5,270 3,437 5,289
Constancia 13,897 22,292 19,003 7,444 6,905 10,496 7,196 8,042
San Dimas (4) 7,542 10,024 9,995 11,166 10,754 10,037 11,808 10,044
Stillwater (5) 2,637 2,341 2,454 2,017 1,960 2,185 1,833 2,171
Other
Marmato 623 668 673 639 457 533 542 778
777 (6) - - - - - - - 3,509
Minto (7) - - - 1,292 3,063 2,567 3,050 2,480
Total Other 623 668 673 1,931 3,520 3,100 3,592 6,767
Total gold ounces produced 93,370 112,926 105,027 83,180 73,019 69,027 72,078 66,442
Silver ounces produced (2)
Peñasquito (8) 2,643 1,036 - 1,744 2,076 1,761 2,017 2,089
Antamina 806 1,030 894 984 872 1,067 1,327 1,330
Constancia 640 836 697 420 552 655 564 584
Other
Los Filos 42 28 28 28 45 14 21 35
Zinkgruvan 641 510 785 374 632 664 642 739
Neves-Corvo 524 573 486 407 436 369 323 345
Aljustrel (9) - - 327 279 343 313 246 292
Cozamin 173 185 165 184 141 157 179 169
Marmato 7 10 11 7 8 9 7 7
Yauliyacu (10) - - - - - 261 463 756
Minto (7) - - - 14 29 33 33 26
Keno Hill (11) - - - - - - - 48
777 (6) - - - - - - - 80
Total Other 1,387 1,306 1,802 1,293 1,634 1,820 1,914 2,497
Total silver ounces produced 5,476 4,208 3,393 4,441 5,134 5,303 5,822 6,500
Palladium ounces produced ²
Stillwater (5) 4,463 4,209 4,006 3,880 3,705 3,869 3,229 3,899
Cobalt pounds produced ²
Voisey's Bay 240 215 183 152 124 128 226 136
GEOs produced (12) 160,133 164,818 147,230 137,176 134,730 132,780 142,103 144,019
Average payable rate (2)
Gold 94.8% 95.1% 95.4% 95.1% 95.1% 94.9% 95.1% 95.1%
Silver 84.5% 83.0% 78.3% 83.7% 83.1% 84.2% 86.3% 86.5%
Palladium 96.9% 95.9% 93.6% 94.1% 96.0% 91.7% 95.0% 94.6%
Cobalt 93.3% 93.3% 93.3% 93.3% 93.3% 93.3% 93.3% 93.3%
GEO (11) 90.7% 91.6% 90.8% 90.8% 89.8% 89.9% 90.9% 90.7%
1) All figures in thousands except gold and palladium ounces produced.
2) Quantity produced represent 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: Q1 2024 - 291,000 ounces;
Q4 2023 - 378,000 ounces; 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.
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) On May 13, 2023, Minto Metals Corp. announced the suspension of
operations at the Minto mine.
8) There was a temporary suspension of operations at Peñasquito due to a
labour strike which ran from June 7, 2023 to October 13, 2023.
9) On September 12, 2023, it was announced that the production of the zinc
and lead concentrates at the Aljustrel mine will be halted from September 24,
2023 until the second quarter of 2025.
10) On December 14, 2022 the Company
terminated the Yauliyacu PMPA in exchange for a cash payment of $132 million.
11) On September 7, 2022, the Company
terminated the Keno Hill PMPA in exchange for $141 million of Hecla common
stock.
12) GEOs, which are provided to assist the
reader, are based on the following commodity price assumptions: $2,000 per
ounce gold; $23.00 per ounce silver; $1,000 per ounce palladium; and $13.00
per pound cobalt; consistent with those used in estimating the Company's
production guidance for 2024.
Summary of Units Sold
Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022
Gold ounces sold
Salobo 56,841 76,656 44,444 46,030 35,966 41,029 31,818 48,515
Sudbury (2) 4,129 5,011 4,836 4,775 4,368 4,988 5,147 7,916
Constancia 20,123 19,925 12,399 9,619 6,579 6,013 6,336 7,431
San Dimas 7,933 10,472 9,695 11,354 10,651 10,943 10,196 10,633
Stillwater (3) 2,355 2,314 1,985 2,195 2,094 1,783 2,127 2,626
Other
Marmato 638 633 792 467 480 473 719 781
777 - - 275 153 126 785 3,098 3,629
Minto - - - 701 2,341 2,982 2,559 2,806
Total Other 638 633 1,067 1,321 2,947 4,240 6,376 7,216
Total gold ounces sold 92,019 115,011 74,426 75,294 62,605 68,996 62,000 84,337
Silver ounces sold
Peñasquito 1,839 442 453 1,913 1,483 2,066 1,599 2,096
Antamina 762 1,091 794 963 814 1,114 1,155 1,177
Constancia 726 665 435 674 366 403 498 494
Other
Los Filos 44 24 30 37 34 16 24 41
Zinkgruvan 297 449 714 370 520 547 376 650
Neves-Corvo 243 268 245 132 171 80 105 167
Aljustrel 1 86 142 182 205 156 185 123
Cozamin 147 141 139 150 119 150 154 148
Marmato 8 9 11 7 7 7 8 11
Yauliyacu - - - - - 337 1,005 817
Stratoni - - - - - - - (2)
Minto - - - 7 29 23 22 21
Keno Hill - - - - 1 1 30 30
777 - - 2 2 - 35 73 75
Total Other 740 977 1,283 887 1,086 1,352 1,982 2,081
Total silver ounces sold 4,067 3,175 2,965 4,437 3,749 4,935 5,234 5,848
Palladium ounces sold
Stillwater (3) 4,774 3,339 4,242 3,392 2,946 3,396 4,227 3,378
Cobalt pounds sold
Voisey's Bay 309 288 198 265 323 187 115 225
GEOs sold (4) 143,184 155,059 111,935 129,734 109,293 128,662 125,053 154,737
Cumulative payable units PBND (5)
Gold ounces 87,542 91,092 98,715 72,916 77,377 70,562 74,053 67,529
Silver ounces 2,347 1,787 1,469 1,777 2,531 2,013 2,481 2,694
Palladium ounces 6,198 6,666 5,607 6,122 5,751 5,098 5,041 6,267
Cobalt pounds 360 356 377 251 285 258 403 280
GEO (4) 119,968 117,293 120,864 98,039 111,216 97,934 107,718 103,465
Inventory on hand
Cobalt pounds - 88 155 310 398 633 556 582
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: $2,000 per ounce gold; $23.00 per ounce
silver; $1,000 per ounce palladium; and $13.00 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2024.
5) Payable gold, silver and palladium ounces as well as cobalt pounds
produced but not yet delivered ("PBND") are based on management estimates.
These figures may be updated in future periods as additional information is
received.
Results of Operations
The operating results of the Company's reportable operating segments are
summarized in the tables and commentary below.
Three Months Ended March 31, 2024
Units Produced² Units Average Average Average Sales Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 61,622 56,841 $ 2,073 $ 425 $ 393 $ 117,851 $ 71,396 $ 94,050 $ 2,659,099
Sudbury (4) 7,049 4,129 2,049 400 1,145 8,461 2,081 6,814 257,757
Constancia 13,897 20,123 2,073 420 316 41,723 26,910 33,263 73,912
San Dimas 7,542 7,933 2,073 631 279 16,448 9,237 11,445 142,512
Stillwater 2,637 2,355 2,073 372 510 4,883 2,806 4,008 210,267
Other (5) 623 638 2,073 374 527 1,323 748 1,084 892,983
93,370 92,019 $ 2,072 $ 439 $ 404 $ 190,689 $ 113,178 $ 150,664 $ 4,236,530
Silver
Peñasquito 2,643 1,839 $ 23.74 $ 4.50 $ 4.06 $ 43,650 $ 27,901 $ 35,375 $ 268,758
Antamina 806 762 23.74 4.68 7.06 18,088 9,147 14,523 514,154
Constancia 640 726 23.74 6.20 6.24 17,236 8,200 12,734 175,049
Other (6) 1,387 740 23.89 4.15 4.16 17,684 11,539 15,819 603,933
5,476 4,067 $ 23.77 $ 4.77 $ 5.03 $ 96,658 $ 56,787 $ 78,451 $ 1,561,894
Palladium
Stillwater 4,463 4,774 $ 980 $ 182 $ 445 $ 4,677 $ 1,683 $ 3,808 $ 218,542
Platreef - - n.a. n.a. n.a. - - - 78,786
4,463 4,774 $ 980 $ 182 $ 445 $ 4,677 $ 1,683 $ 3,808 $ 297,328
Platinum
Marathon - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ 9,451
Platreef - - n.a. n.a. n.a. - - - 57,564
- - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ 67,015
Cobalt
Voisey's Bay 240 309 $ 15.49 $ 2.96 $ 12.77 $ 4,782 $ (73) $ 7,006 $ 348,000
Operating results $ 296,806 $ 171,575 $ 239,929 $ 6,510,767
Other
General and administrative $ (10,464) $ (15,958)
Share based compensation (1,281) (11,129)
Donations and community investments (1,570) (1,373)
Finance costs (1,442) (1,125)
Other 7,196 9,152
Income tax 27 (116)
Total other $ (7,534) $ (20,549) $ 669,688
$ 164,041 $ 219,380 $ 7,180,455
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) Other gold interests comprised of the operating Marmato gold interest
as well as the non-operating Minto, Copper World, Santo Domingo, Fenix,
Blackwater, Curipamba, Marathon, Goose, Cangrejos, Platreef, Curraghinalt and
Kudz Ze Kayah gold interests.
6) Other silver interests comprised of the operating Los Filos,
Zinkgruvan, Neves-Corvo, Marmato and Cozamin silver interests as well as the
non-operating Stratoni, Aljustrel, Minto, Pascua-Lama, Copper World, Navidad,
Blackwater, Curipamba, Mineral Park and Kudz Ze Kayah silver interests.
On a gold equivalent basis, results for the Company for the three months ended
March 31, 2024 were as follows:
Three Months Ended March 31, 2024
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) 160,133 143,184 $ 2,073 $ 430 $ 1,643 $ 445 $ 1,198
1) Quantity produced represent 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: $2,000 per ounce gold; $23.00 per ounce
silver; $1,000 per ounce palladium; and $13.00 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2024.
Three Months Ended March 31, 2023
Units Produced² Units Average Average Average Sales Net Cash Flow Total
Sold
Realized
Cash Cost
Depletion
Earnings
From
Assets
Price
($'s Per
($'s Per
Operations
($'s
Unit) (3)
Unit)
Per Unit)
Gold
Salobo 43,677 35,966 $ 1,904 $ 420 $ 330 $ 68,475 $ 41,471 $ 53,355 $ 2,371,378
Sudbury (4) 6,203 4,368 1,904 400 1,025 8,317 2,095 6,346 278,941
Constancia 6,905 6,579 1,904 416 316 12,526 7,710 9,788 93,506
San Dimas 10,754 10,651 1,904 624 260 20,279 10,865 13,629 153,101
Stillwater 1,960 2,094 1,904 334 510 3,987 2,220 3,288 214,783
Other (5) 3,520 2,947 1,904 1,385 86 5,612 1,278 1,155 525,338
73,019 62,605 $ 1,904 $ 496 $ 360 $ 119,196 $ 65,639 $ 87,561 $ 3,637,047
Silver
Peñasquito 2,076 1,483 $ 22.84 $ 4.43 $ 4.06 $ 33,872 $ 21,276 $ 27,303 $ 287,647
Antamina 872 814 22.84 4.55 7.06 18,594 9,142 14,888 539,623
Constancia 552 366 22.84 6.14 6.24 8,353 3,825 6,107 190,664
Other (6) 1,634 1,086 22.87 5.96 2.53 24,859 15,637 20,047 450,412
5,134 3,749 $ 22.85 $ 5.07 $ 4.48 $ 85,678 $ 49,880 $ 68,345 $ 1,468,346
Palladium
Stillwater 3,705 2,946 $ 1,607 $ 294 $ 408 $ 4,735 $ 2,666 $ 3,870 $ 225,609
Platinum
Marathon - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ 9,440
Cobalt
Voisey's Bay 124 323 $ 15.04 $ 3.30⁷ $ 13.85 $ 4,856 $ (684) $ 4,485 $ 356,447
Operating results $ 214,465 $ 117,501 $ 164,261 $ 5,696,889
Other
General and administrative $ (10,099) $ (13,836)
Share based compensation (7,397) (16,675)
Donations and community investments (1,378) (1,408)
Finance costs (1,378) (1,070)
Other 7,562 7,176
Income tax 6,580 (3,344)
Total other $ (6,110) $ (29,157) $ 1,208,590
$ 111,391 $ 135,104 $ 6,905,479
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 as well as the non-operating Stobie and Victor gold
interests.
5) Other gold interests are comprised of the operating Minto and Marmato
gold interests as well as the non-operating 777, Copper World, Santo Domingo,
Fenix, Blackwater, Marathon, Curipamba and Goose 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) Other silver interests comprised of the operating Los Filos,
Zinkgruvan, Neves-Corvo, Aljustrel, Minto, Cozamin and Marmato silver
interests, the non-operating Loma de La Plata, Stratoni, Pascua-Lama, Copper
World, 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 first quarter of 2023 was
net of a previously recorded inventory write-down of $1 million, resulting in
a decrease of $3.18 per pound of cobalt sold.
On a gold equivalent basis, results for the Company for the three months ended
March 31, 2023 were as follows:
Three Months Ended March 31, 2023
Ounces Ounces Average Average Cash Operating Margin Average Gross
Produced (1)
Sold
Realized
Cash Cost
($'s Per Ounce) (3)
Depletion
Margin
Price
($'s Per
($'s Per
($'s Per
($'s Per
Ounce) (2)
Ounce)
Ounce)
Ounce)
Gold equivalent basis (4) 134,730 109,293 $ 1,962 $ 475 $ 1,487 $ 412 $ 1,075
1) Quantity produced represent 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: $2,000 per ounce gold; $23.00 per ounce
silver; $1,000 per ounce palladium; and $13.00 per pound cobalt; consistent
with those used in estimating the Company's production guidance for 2024.
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
March 31
(in thousands, except for per share amounts) 2024 2023
Net earnings $ 164,041 $ 111,391
Add back (deduct):
(Gain) loss on fair value adjustment of share purchase warrants held (183) (175)
Income tax (expense) recovery recognized in the Statement of OCI (96) (3,954)
Income tax recovery related to prior year disposal of Mineral Stream Interest - (2,672)
Other (173) (159)
Adjusted net earnings $ 163,589 $ 104,431
Divided by:
Basic weighted average number of shares outstanding 453,094 452,370
Diluted weighted average number of shares outstanding 453,666 453,159
Equals:
Adjusted earnings per share - basic $ 0.361 $ 0.231
Adjusted earnings per share - diluted $ 0.361 $ 0.230
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
March 31
(in thousands, except for per share amounts) 2024 2023
Cash generated by operating activities $ 219,380 $ 135,104
Divided by:
Basic weighted average number of shares outstanding 453,094 452,370
Diluted weighted average number of shares outstanding 453,666 453,159
Equals:
Operating cash flow per share - basic $ 0.484 $ 0.299
Operating cash flow per share - diluted $ 0.484 $ 0.298
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
March 31
(in thousands, except for gold and palladium ounces sold and per unit amounts) 2024 2023
Cost of sales $ 125,231 $ 96,964
Less: depletion (63,676) (45,000)
Cash cost of sales $ 61,555 $ 51,964
Cash cost of sales is comprised of:
Total cash cost of gold sold $ 40,362 $ 31,035
Total cash cost of silver sold 19,411 18,997
Total cash cost of palladium sold 869 866
Total cash cost of cobalt sold¹ 913 1,066
Total cash cost of sales $ 61,555 $ 51,964
Divided by:
Total gold ounces sold 92,019 62,605
Total silver ounces sold 4,067 3,749
Total palladium ounces sold 4,774 2,946
Total cobalt pounds sold 309 323
Equals:
Average cash cost of gold (per ounce) $ 439 $ 496
Average cash cost of silver (per ounce) $ 4.77 $ 5.07
Average cash cost of palladium (per ounce) $ 182 $ 294
Average cash cost of cobalt (per pound) $ 2.96 $ 3.30
1) Cash cost per pound of cobalt sold during the first quarter of 2023 was
net of a previously recorded inventory write-down of $1 million, resulting in
a decrease of $3.18 per pound of cobalt sold.
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
March 31
(in thousands, except for gold and palladium ounces sold and per unit amounts) 2024 2023
Gross margin $ 171,575 $ 117,501
Add back: depletion 63,676 45,000
Cash operating margin $ 235,251 $ 162,501
Cash operating margin is comprised of:
Total cash operating margin of gold sold $ 150,327 $ 88,161
Total cash operating margin of silver sold 77,247 66,681
Total cash operating margin of palladium sold 3,808 3,869
Total cash operating margin of cobalt sold 3,869 3,790
Total cash operating margin $ 235,251 $ 162,501
Divided by:
Total gold ounces sold 92,019 62,605
Total silver ounces sold 4,067 3,749
Total palladium ounces sold 4,774 2,946
Total cobalt pounds sold 309 323
Equals:
Cash operating margin per gold ounce sold $ 1,633 $ 1,408
Cash operating margin per silver ounce sold $ 19.00 $ 17.78
Cash operating margin per palladium ounce sold $ 798 $ 1,313
Cash operating margin per cobalt pound sold $ 12.53 $ 11.74
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 future price of commodities;
· the estimation of future production from the mineral stream
interests and mineral royalty interests currently owned by the Company (the
"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 Mining
Operations;
· the payment of upfront cash consideration to counterparties under
PMPAs, the satisfaction of each party's obligations in accordance with PMPAs
and the receipt by the Company of precious metals and cobalt production or
other payments in respect of the applicable Mining Operations under PMPAs;
· 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,
including any acceleration of payments;
· the costs of future production;
· the estimation of produced but not yet delivered ounces;
· the future sales of Common Shares under, the amount of net
proceeds from, and the use of the net proceeds from, the at-the-market equity
program;
· continued listing of the Common Shares on the LSE, NYSE and TSX;
· any statements as to future dividends;
· the ability to fund outstanding commitments and the ability to
continue to acquire accretive PMPAs;
· 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, including the
implementation of a 15% global minimum tax, and the impact of the CRA
Settlement;
· possible CRA 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 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
exploration, development, operating, expansion and improvement at the Mining
Operations, environmental and economic risks of the Mining Operations, and
changes in project parameters as Mining Operations plans continue to be
refined);
· 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 owners and operators of the Mining Operations as the basis
for its analyses, forecasts and assessments relating to its own business;
· risks related to the uncertainty in the accuracy of mineral
reserve and mineral resource estimation;
· risks related to the satisfaction of each party's obligations in
accordance with the terms of the Company's PMPAs, including the ability of the
companies with which the Company has PMPAs to perform their obligations under
those PMPAs in the event of a material adverse effect on the results of
operations, financial condition, cash flows or business of such companies, any
acceleration of payments, estimated throughput and exploration potential;
· risks relating to production estimates from Mining Operations,
including anticipated timing of the commencement of production by certain
Mining Operations;
· Wheaton's interpretation of, or compliance with, or application
of, tax laws and regulations or accounting policies and rules, being found to
be incorrect or the tax impact to the Company's business operations being
materially different than currently contemplated;
· 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;
· risks in 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);
· risks related to any 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;
· risks relating to the implementation of a 15% global minimum tax,
including the Federal budget bill, C-69, which contains the GMTA reflecting
application of global minimum tax to in-scope companies for fiscal years
beginning on or after December 31, 2023 and the legislation enacted in
Luxembourg that applies to the income of the Company's Luxembourg subsidiary
as of January 1, 2024 and the Company and its other subsidiaries from January
1, 2025;
· counterparty credit and liquidity risks;
· mine operator and counterparty concentration risks;
· indebtedness and guarantees risks;
· hedging risk;
· competition in the streaming industry risk;
· risks relating to security over underlying assets;
· risks relating to third-party PMPAs;
· risks relating to revenue from royalty interests;
· risks related to Wheaton's acquisition strategy;
· risks relating to third-party rights under PMPAs;
· risks relating to future financings and security issuances;
· risks relating to unknown defects and impairments;
· risks related to governmental regulations;
· risks related to international operations of Wheaton and the
Mining Operations;
· risks relating to exploration, development, operating, expansions
and improvements at the Mining Operations;
· risks related to environmental regulations;
· the ability of Wheaton and the Mining Operations to obtain and
maintain necessary licenses, permits, approvals and rulings;
· the ability of Wheaton and the Mining Operations to comply with
applicable laws, regulations and permitting requirements;
· lack of suitable supplies, infrastructure and employees to
support the Mining Operations;
· risks related to underinsured 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 related to title and indigenous rights with respect
to the mineral properties of the Mining Operations;
· the ability of Wheaton and the Mining Operations to obtain
adequate financing;
· the ability of the Mining Operations to complete permitting,
construction, development and expansion;
· challenges related to global financial conditions;
· risks associated with environmental, social and governance
matters;
· risks related to fluctuations in commodity prices of metals
produced from the Mining Operations other than precious metals or cobalt;
· risks related to claims and legal proceedings against Wheaton or
the Mining Operations;
· risks related to the market price of the Common Shares of
Wheaton;
· the ability of Wheaton and the Mining Operations to retain key
management employees or procure the services of skilled and experienced
personnel;
· risks related to interest rates;
· risks related to the declaration, timing and payment of
dividends;
· risks related to access to confidential information regarding
Mining Operations;
· risks associated with multiple listings of the Common Shares on
the LSE, NYSE and TSX;
· risks associated with a possible suspension of trading of Common
Shares;
· risks associated with the sale of Common Shares under the
at-the-market equity program, including the amount of any net proceeds from
such offering of Common Shares and the use of any such proceeds;
· equity price risks related to Wheaton's holding of long‑term
investments in other companies;
· risks relating to activist shareholders;
· risks relating to reputational damage;
· risks relating to expression of views by industry analysts;
· risks related to the impacts of climate change and the transition
to a low-carbon economy;
· risks associated with the ability to achieve climate change and
environmental commitments at Wheaton and at the Mining Operations;
· risks related to ensuring the security and safety of information
systems, including cyber security risks;
· risks relating to generative artificial intelligence;
· risks relating to compliance with anti-corruption and
anti-bribery laws;
· risks relating to corporate governance and public disclosure
compliance;
· risks of significant impacts on Wheaton or the Mining Operations
as a result of an epidemic or pandemic;
· risks related to the adequacy of internal control over financial
reporting; 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):
· 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 public disclosure and other information Wheaton receives
from the owners and operators of the Mining Operations is accurate and
complete;
· that the production estimates from Mining Operations 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 the terms and conditions of a PMPA are sufficient to recover
liabilities owed to the Company;
· that Wheaton has fully considered the value and impact of any
third-party interests in PMPAs;
· that expectations regarding the resolution of legal and tax
matters will be achieved (including CRA audits involving the Company);
· that Wheaton has properly considered the application of Canadian
tax laws to its structure and operations;
· that Wheaton has filed its tax returns and paid applicable taxes
in compliance with Canadian tax laws;
· that Wheaton's application of the CRA Settlement is accurate
(including the Company's assessment that there has been no material change in
the Company's facts or change in law or jurisprudence);
· that Wheaton's assessment of the tax exposure and impact on the
Company and its subsidiaries of the implementation of a 15% global minimum tax
is accurate;
· that any sale of Common Shares under the at-the-market equity
program will not have a significant impact on the market price of the Common
Shares and that the net proceeds of sales of Common Shares, if any, will be
used as anticipated;
· that the trading of the 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;
· the estimate of the recoverable amount for any PMPA with an
indicator of impairment;
· that neither Wheaton nor the Mining Operations will suffer
significant impacts as a result of an epidemic or pandemic; 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, 2023, which was filed on March 28, 2024
and other continuous disclosure documents filed by Wheaton since January 1,
2024, 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) .
End Notes
1 (#_ednref1) Please refer to disclosure on non-IFRS measures in 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 dated May 9, 2024, titled "Wheaton
Precious Metals Declares Quarterly Dividend."
2 (#_ednref2) Statements made in this section contain forward-looking
information with respect to forecast production, production growth, funding
outstanding commitments, continuing to acquire accretive mineral stream
interests and the commencement, timing and achievement of construction,
expansion or improvement projects 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) Gold equivalent forecast production for 2024 and the longer-term outlook
are based on the following commodity price assumptions: $2,000 per ounce gold,
$23 per ounce silver, $1,000 per ounce palladium, $950 per ounce of platinum
and $13.00 per pound cobalt.
(4) Source: Company reports & S and P Capital IQ estimates of 2024
byproduct cost curves for gold, zinc/lead, copper, PGM, nickel & silver
mines. 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.
(5) Total streaming and royalty agreements relate to precious metals purchase
agreements for the purchase of precious metals and cobalt relating to 18
mining assets which are currently operating, 23 which are at various stages of
development and 4 of which have been placed in care and maintenance or have
been closed.
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