IMPACT Silver announces third quarter 2021 results, net income positive for the third quarter, with year-to-date operating cash flow of $ 2.8 million
Vancouver, British Columbia – (Newsfile Corp. – Nov 22, 2021) – IMPACT Silver Corp. (TSXV: IPT) (OTC Pink: ISVLF) (“IMPACT” or the “Company”) announced its financial and operating results for the third quarter ended September 30, 2021.
The company posted revenue of $ 13.7 million for the first three quarters of 2021, an improvement of 24% year over year over revenue of $ 11.0 for the first three quarters of 2020. Cash flow from operating activities improved to date at $ 2.8 million, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) remained strong at $ 1.9 million.
After investing $ 3.0 million in exploration and mining investments year-to-date, the cash position remained at $ 21.5 million with working capital of $ 22.1 million versus cash on hand of $ 17.4 million. Remaining strong and working capital of $ 16.8 million as of September 30, 2020, the company has drilled over 10,000 meters on the property in 2021.
The mineâs operating profit before depreciation and exhaustion improved by 45% to 3.2 million for the current year, with a positive impact on variety and tonnage by the first quarter of 2022.
Financial overview for the third quarter of 2021
- Sales in the third quarter of 2021 were 4.1 million euros in this quarter due to lower silver grades and lower tonnage.
- Net income for the quarter was $ 0.03 million, lower than the third quarter of 2020 as silver grades declined due to increased processing of development sludge and declining grades in older sections of the Guadalupe Mine.
- The company’s net working capital as of September 30, 2021 was $ 22.1 million compared to $ 16.8 million, an increase of 31.5% over the same period.
- After investing $ 1.3 million in exploration and other capital investments during the quarter, cash remained strong at $ 21.5 million.
- The company has no long-term debt.
Q3 2021 production overview
- The throughput in the mill was 34,587 tons in the third quarter of 2021, which is a slight increase over the third quarter of 2020.
- The average mill feed grade for silver was 156 grams per tonne (g / t) in the third quarter of 2021, a decrease of 6% from 166 g / t in the third quarter of 2020. Management expects grades to improve as high grade areas are redefined with the Feeding of the mill will begin in 2022. In the third quarter of 2021 there was heavy rainfall, which led to higher transport and mining costs. Mining in the high-grade Veta Negra open pit stopped during the quarter due to heavy rainfall.
- Direct cost per tonne of production was $ 91.31 for the third quarter of 2021 as the Company stepped up exploration and development at the Guadalupe Mine. The YTD cost per ton was $ 82.60.
- Silver production in the third quarter of 2021 was 152,026 ounces (2020 – 158,992 ounces).
EXPLORATION AND DEVELOPMENT PLANS
Guadalupe is working to bring manufacturing capacity back to pre-pandemic levels as supply chain and pandemic logs weaken. An extensive underground development program is ongoing in Guadalupe, which includes a two-stage rehabilitation of the mine shaft at the Guadalupe mine, as well as the rebuilding and expansion of the extensive underground railway system at the 195 level to reach the Pachuqueno section of the mine, which recently Drilling intersections has been reported to be high. As a result, a significantly higher capacity is achieved with lower transport costs. As development continues, the company expects to gradually increase production from the Guadalupe complex towards the end of the year.
In response to further exploration news, the company’s own fleet was expanded to include a fourth drill rig and the drilling plans were expanded to 20,000 meters by 2022. This will also include tracking of recent drill successes at Guadalupe and Pachuqueno which returned 2,186 g / t silver over 3.38 meters. The San Ramon Mine will also drill additional zones outside of the previous production areas this year.
CAPIRE – POSSIBLE RESTART OF OPEN PIT PRODUCTION
Company engineers are reviewing the Capire open pit mine and processing facility for a possible resumption of operations. Previous 43-101 studies on the Capire deposit have been recalculated and verified by a review using the experience of previous test mining operations. Further studies will be carried out on critical infrastructures to determine the optimal plant size for Capire operations. As a result of successful laboratory-scale studies, a bulk sample of 1,400 kilograms of material selected by the Company’s consultant from the Capire open pit mine was also sent to a Canadian laboratory for testing using state-of-the-art X-ray transmission (“XRT”) preconcentration processing technology. XRT technology is a process that recognizes and sorts rocks based on the specific atomic density of the material. XRT quickly separates ore-bearing material from waste, reducing the amount of material to be processed during the grinding process, resulting in cost savings. The preliminary results have been positive and further tests on a commercial scale are planned. The company will evaluate the impact of XRT technology on capital and operating costs, extraction, and the ultimate mining and processing rate.
A recorded conference call detailing the financial and manufacturing results for the quarter ended September 30, 2021 will be available on November 23, 2021 on the company’s website www.impactsilver.com/s/ConferenceCalls.asp.
The information in this press release should be read in conjunction with the company’s unaudited condensed interim consolidated financial statements for the third quarter of 2021 and management discussion and analysis available on the company’s website at www.impactsilver.com and on SEDAR at www. sedar.com are available. All amounts are in Canadian dollars unless otherwise noted.
ABOUT IMPACT SILVER
IMPACT Silver Corp. is a successful silver explorer producer with over 90% of its revenue from silver, resulting in a share price that is heavily dependent on the price of silver. The company has two processing plants in adjoining counties within its 100% owned mineral concessions covering 211 km2 in central Mexico with excellent infrastructure and manpower. Over the past 15 years, IMPACT has produced over 11.2 million ounces of silver and revenues of over $ 220 million with no long-term debt. In the Royal Mines of Zacualpan Silver District, three underground silver mines and one open pit mine supply Guadalupe’s central processing facility. To the south, in the Mamatla district, the Capire project includes a 200 tpd processing pilot plant adjacent to an open pit silver mine with a mineral resource of over 4.5 million ounces of silver, 48 million pounds of zinc and 21 million pounds of lead (see IMPACT News publication dated January 18, 2016 for details). The company’s engineers are reviewing Capire for a possible resumption of operations amid current increases in silver prices. With 15 years of exploration success resulting in production cash flows, IMPACT has shown the Zacualpan Silver District is endowed with many high grade silver-gold zones and has brought several zones into commercial production.
For more information about IMPACT and its activities, please visit the company’s website at www.impactsilver.com Follow us on Twitter @IMPACT_Silver and LinkedIn at https://www.linkedin.com/company/impactsilver
Qualified Person and Disclosure under NI 43-101
George Gorzynski, P. Eng., Vice President and Director of IMPACT Silver Corp. and a Qualified Person as defined by Canadian National Instrument 43-101, approved the technical information in this news release.
On behalf of IMPACT Silver Corp.
“Frederick W. Davidson”
President and CEO
For more information, please contact:
CFO | Investor Relations
Neither the TSX Venture Exchange nor its regulator (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
Forward-looking and cautionary statements
This IMPACT press release may contain certain “forward-looking” statements and information regarding IMPACT that are based on the beliefs of the IMPACT management and on assumptions and information currently available to IMPACT management. Such statements reflect current risks, uncertainties and assumptions about certain factors, but are not limited to exploration and development risks, spending and funding requirements, title matters, operational risks, metal prices, political and economic factors, competitive factors, general economic conditions, relationship on vendors and strategic partners, government regulation and oversight, seasonality, technological change, industry practices, and one-off events. Should one or more risks or uncertainties materialize or change, or should underlying assumptions prove incorrect, actual results and forward-looking statements could differ materially from those described herein. IMPACT does not undertake any obligation to update forward-looking statements unless required by law.
The Company’s decision to bring a mine into production, expand a mine, make other production-related decisions, or otherwise engage in mining and processing operations is based largely on internal, non-public company data and reports derived from exploration, development and mining operations the company’s geologists and engineers. The results of this work can be seen in the discovery and construction of multiple mines for the company, as well as the company’s track record of mineral production and financial returns since 2006. NI 43-101 requires the company to disclose that it has not based its production decisions on NI 43-101 compliant mineral resource or reserve estimates, preliminary economic assessments, or feasibility studies, and in the past such projects have increased uncertainty and the risk of failure.
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