All amounts are expressed in US$ unless otherwise indicated.
Financial information is based on International Financial Reporting
Standards ("IFRS") as issued by the International Accounting
Standards Board. Results are unaudited.
This news release refers to measures that are not generally
accepted accounting principle ("Non-GAAP") financial measures,
including cash costs per payable ounce of silver, all-in sustaining
costs per silver ounce sold, and adjusted earnings (losses). Please
refer to the section titled "Alternative Performance (non-GAAP)
Measures" contained in this news release for further information on
these measures.
VANCOUVER, Feb. 14, 2017 /CNW/ - Pan American Silver
Corp. (NASDAQ: PAAS; TSX: PAAS) ("Pan American", or the
"Company") today reported unaudited results for the fourth quarter
ended December 31, 2016 ("Q4 2016")
and full year 2016.
"We achieved solid performance on all fronts in 2016, generating
$215 million in net cash from
operating activities and beating our original guidance for both
costs and silver production," said Michael
Steinmann, President and Chief Executive Officer of the
Company. "We achieved major milestones at our La Colorada and Dolores mine expansions in Mexico. We expect both expansions will be
completed by the end of this year, which contributes to an
improving outlook for costs and production over the next three
years."
Added Mr. Steinmann: "We entered 2017 in a very strong financial
position, with cash and short-term investments of $218 million, despite funding the peak year of
capital expenditures for our mine expansions and repaying
short-term debt. Our strong financial position enables us to
continue investing in our mines and suite of assets, while pursuing
attractive growth opportunities."
Highlights for the three and twelve-month periods ended
December 31, 2016:
- Silver production in Q4 2016 was 6.31 million ounces
compared with 6.79 million ounces in Q4 2015. The decrease
primarily reflects anticipated production declines at Alamo Dorado
and Manantial Espejo, partially offset by higher silver production
at La Colorada and Morococha. For
the twelve-month period, silver production totaled 25.42 million
ounces in 2016 compared with 26.12 million ounces in the same
period of 2015. The decrease in year-over-year production reflects
Alamo Dorado and open-pit mining at Manantial Espejo nearing
completion, and mine sequencing at Dolores.
- Gold production was 43.9 thousand ounces in Q4 2016
compared with 48.2 thousand ounces in the same period of 2015.
Production decreases at Manantial Espejo and Alamo Dorado more than
offset the production increase at Dolores, as anticipated. For the twelve-month
period, gold production was 183.9 thousand ounces in 2016 compared
with 183.7 thousand ounces in 2015.
- Consolidated cash costs per payable ounce of silver, net
of by-product credits ("Cash Costs") of $6.66 in Q4 2016 declined from $9.09 recorded in Q4 2015. For the year-ended
2016, Cash Costs of $6.29 were down
35% compared with 2015. The reduction in Cash Costs reflects
increased by-product credits and lower direct operating costs.
- Consolidated All-In Sustaining Costs per Silver Ounce Sold
("AISCSOS") was $10.38 in Q4 2016
compared with $14.76 in Q4 2015. For
the twelve-month period, AISCSOS was $10.17, down 32% compared with $14.92 in 2015. The decrease in year-over-year
AISCSOS mainly reflects increased by-product credits, lower
production costs, positive inventory
valuation adjustments at Manantial Espejo and Dolores, and export incentives at Manantial
Espejo.
- Revenue was $190.6 million
in Q4 2016 compared with $163.0
million in Q4 2015. Annual revenue was up 15% to
$774.8 million in 2016 compared with
2015, largely a result of higher metal prices. Realized silver
prices per ounce averaged $17.65 in
Q4 2016 and $17.35 for the full year
2016 compared with $14.66 and
$15.53 in the 2015 respective
periods.
- Net cash generated from operating activities was
$45.7 million in Q4 2016, up 95% from
Q4 2015. Full year 2016 net cash generated from operating
activities of $214.8 million was more
than double the $88.7 million
recorded in 2015.
- Net income increased to $22.3
million ($0.14 basic
earnings per share) in Q4 2016 compared with a net loss of
$137.0 million ($0.88 basic loss per share) in Q4 2015. For the
full year, net income was $101.8
million ($0.66 basic earnings
per share) in 2016 compared with a net loss of $231.6 million ($1.49 basic loss per share) in 2015. The
increase in year-over-year net income reflects higher revenue,
lower costs and gains associated with the sale of our interest
in Shalipayco to Votorantim Metais - Cajamarquilla S.A.
("Votorantim") and the Maverix Metals Inc. ("Maverix")
transaction, partially offset by higher income taxes. Net income in
Q4 2015 and full year 2015 were also impacted by impairment charges
of $121.5 million and $150.3 million, respectively.
- Adjusted earnings were $27.5
million ($0.18 basic adjusted
earnings per share) in Q4 2016 compared with an adjusted net loss
of $12.7 million ($0.08 basic adjusted loss per share) in Q4 2015.
Full year 2016 adjusted earnings were $95.2
million ($0.63 basic adjusted
earnings per share) compared with an adjusted net loss of
$41.3 million ($0.27 basic adjusted loss per share) in
2015. The most significant adjustments to earnings were the removal
of the gains associated with the Votorantim and Maverix
transactions in 2016 and removal of the impairment charges recorded
in 2015.
- Liquidity position. At December
31, 2016, cash and cash equivalents and short-term
investment balances were $217.6
million and the working capital position was $428.6 million. Total debt outstanding was
$43.3 million after repayment of
$5.9 million in short-term debt in Q4
2016.
- Capital expenditures totaled $198.4 million in 2016, with $119.0 million directed to expansion projects at
the Dolores and La Colorada mines, and the remaining
$79.4 million to sustaining
capital.
- A quarterly cash dividend of $0.025 per common share, approximately
$3.8 million in aggregate cash
dividends, has been approved by the Board of Directors. This is an
increase from the quarterly dividend paid in 2016 of $0.0125 per common share. The dividend will
be payable on or about Friday, March 10,
2017, to holders of record of Pan American's common shares
as of the close on Monday, February 27,
2017. Pan American's dividends are designated as eligible
dividends for the purposes of the Income Tax Act
(Canada). As is standard practice,
the amounts and specific distribution dates of any future dividends
will be evaluated and determined by the Board of Directors on an
ongoing basis.
- Maverix transaction. During Q4 2016, Pan American
exercised share purchase warrants in Maverix at a cost of
approximately $5.5 million, and
received replacement warrants in connection with Maverix acquiring
additional royalties from Gold Fields Netherlands Services BV. As
at December 31, 2016, Pan American's
ownership was approximately 39.8% of the total number of the issued
and outstanding common shares of Maverix on a non-diluted basis
(approximately 42.8% on a fully-diluted basis). The transaction
resulted in recording a dilution gain of $8.5 million in Q4 2016, net of a share of loss
from associate.
Consolidated Financial Results
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
(Unaudited in
thousands of U.S. Dollars,
except as
noted)
|
2016
|
2015
|
2016
|
2015
|
Revenue
|
190,596
|
162,960
|
774,775
|
674,688
|
Mine operating
earnings (loss)
|
48,956
|
(7,771)
|
198,879
|
(32,089)
|
Net earnings (loss)
for the period
|
22,284
|
(136,958)
|
101,825
|
(231,556)
|
Adjusted earnings
(loss) for the period(1)
|
27,537
|
(12,685)
|
95,172
|
(41,261)
|
Net cash generated
from operating activities
|
45,668
|
23,401
|
214,804
|
88,692
|
All-in sustaining
cost per silver ounce sold(1)
|
10.38
|
14.76
|
10.17
|
14.92
|
Net earnings (loss)
per share attributable to
common shareholders
(basic)
|
0.14
|
(0.88)
|
0.66
|
(1.49)
|
Adjusted earnings
(loss) per share attributable to
common shareholders
(basic)(1)(2)
|
0.18
|
(0.08)
|
0.63
|
(0.27)
|
(1)
|
Adjusted earnings
(loss) and all-in sustaining costs per silver ounce sold are
non-GAAP measures. Please refer to the "Alternative Performance
(non-GAAP) Measures" section of this news release for further
information on these measures.
|
(2)
|
The Company has begun
including the impact of unrealized FX changes on deferred income
tax balances as a new adjusting item. For comparative purposes,
2015 adjusted earnings have been recalculated in the table above.
The effect of this new adjusting item on 2015 annual and Q4
adjusted earnings was an increase of $0.11 per share and $0.07 per
share, respectively, from those originally reported.
|
Consolidated Operational Results
|
Three months ended
December 31, 2016
|
Three months ended
December 31, 2015
|
|
Production
|
Cash
Costs(1)
$
|
Production
|
Cash
Costs(1)
$
|
|
Ag
(Moz)
|
Au
(koz)
|
Ag
(Moz)
|
Au
(koz)
|
La
Colorada
|
1.67
|
0.86
|
4.38
|
1.42
|
0.65
|
7.28
|
Dolores
|
0.90
|
28.83
|
(5.93)
|
0.95
|
18.21
|
11.64
|
Alamo
Dorado
|
0.40
|
1.41
|
22.80
|
0.82
|
7.89
|
5.49
|
Huaron
|
0.94
|
0.20
|
4.54
|
0.99
|
0.24
|
11.35
|
Morococha
|
0.58
|
0.43
|
5.52
|
0.52
|
0.78
|
12.99
|
San
Vicente
|
1.05
|
n/a
|
11.22
|
1.08
|
n/a
|
11.12
|
Manantial
Espejo
|
0.78
|
12.21
|
14.61
|
1.01
|
20.46
|
6.48
|
TOTAL
|
6.31
|
43.94
|
6.66
|
6.79
|
48.22
|
9.09
|
|
Twelve months
ended December 31, 2016
|
Twelve months
ended December 31, 2015
|
|
Production
|
Cash
Costs(1)
$
|
Production
|
Cash
Costs(1)
$
|
|
Ag
(Moz)
|
Au
(koz)
|
Ag
(Moz)
|
Au
(koz)
|
La
Colorada
|
5.80
|
2.93
|
6.15
|
5.33
|
2.63
|
7.41
|
Dolores
|
3.84
|
102.76
|
(1.08)
|
4.25
|
79.14
|
9.28
|
Alamo
Dorado
|
1.86
|
8.38
|
16.02
|
2.97
|
20.34
|
11.41
|
Huaron
|
3.81
|
0.81
|
5.79
|
3.71
|
1.05
|
10.91
|
Morococha
|
2.54
|
2.14
|
4.21
|
2.17
|
3.22
|
13.03
|
San
Vicente
|
4.43
|
n/a
|
11.95
|
4.12
|
n/a
|
11.57
|
Manantial
Espejo
|
3.14
|
66.89
|
4.28
|
3.58
|
77.32
|
7.33
|
TOTAL
|
25.42
|
183.92
|
6.29
|
26.12
|
183.70
|
9.70
|
Totals may not add up
due to rounding.
|
(1)
|
Cash costs are a
non-GAAP measure. Please refer to the section titled "Alternative
Performance (non-GAAP) Measures" contained in this news release for
further information on these measures.
|
By-Product Results
Production
|
Three months ended
December 31,
|
Twelve months
ended December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Gold - ounces '000s
("koz")
|
43.9
|
48.2
|
183.9
|
183.7
|
Zinc - tonnes '000s
("kt")
|
13.2
|
11.5
|
51.9
|
40.6
|
Lead - kt
|
5.5
|
4.1
|
20.2
|
14.6
|
Copper -
kt
|
3.1
|
4.0
|
14.4
|
15.0
|
Average Market
Metal Prices
|
Three months ended
December 31,
|
Twelve months
ended December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Gold
$/ounce
|
1,222
|
1,106
|
1,251
|
1,160
|
Zinc
$/tonne
|
2,517
|
1,613
|
2,095
|
1,928
|
Lead
$/tonne
|
2,149
|
1,681
|
1,872
|
1,784
|
Copper
$/tonne
|
5,277
|
4,892
|
4,860
|
5,495
|
Mexico mine expansions on
track for completion in 2017
Pan American achieved significant progress in the expansion of
its La Colorada and Dolores mines in Mexico during 2016. At the La Colorada mine, the new mine shaft and
sulphide ore processing plant both began operating on schedule in
Q3 2016. The new 115kV power line to La
Colorada is targeted for completion in Q2 2017, and
additional development headings in the underground mine are
advancing to enable increased ore mining rates up to the designed
1,800 tonnes per day by the end of 2017. The La Colorada expansion project is expected to
increase annual silver production to approximately 7.7 million
ounces in 2018, while also resulting in significant increases in
zinc and lead production.
At Dolores, construction of the
pulp agglomeration plant is approximately 65% complete and
development of the new underground mine is advancing towards
delivering first ore by the end of 2017. The Dolores expansion is expected to increase
silver production by 40% and gold by 52% during the first 5 years
of operation through a combination of greater throughput and higher
recoveries, with associated operational efficiencies helping to
reduce cash costs.
2017 Guidance and Three-year Outlook
There have been no revisions to the outlook Pan American
provided for the years 2017 to 2019 (the "Three-year Outlook") in
its press release dated January 12,
2017. The following table provides Pan American's Three-year
Outlook:
|
2017
Guidance
|
2018
Outlook
|
2019
Outlook
|
Silver production
(million ounces)
|
24.5 -
26.0
|
26.0 -
28.0
|
26.5 -
29.5
|
Gold production
(thousand ounces)
|
155 - 165
|
170 - 185
|
175 - 200
|
Zinc production
(thousand tonnes)
|
56.5 -
58.5
|
59.0 -
63.0
|
55.0 -
65.0
|
Lead production
(thousand tonnes)
|
19.0 -
20.0
|
23.0 -
26.0
|
23.0 -
27.0
|
Copper production
(thousand tonnes)
|
8.75 -
9.25
|
6.00 -
8.00
|
4.00 -
4.20
|
Cash
Costs(1)($/ounce)
|
6.45 -
7.45
|
5.60 -
7.10
|
5.20 -
6.80
|
Sustaining capital ($
millions)
|
82 - 88
|
75 - 85
|
75 - 90
|
Project capital ($
millions)(2)
|
58 - 62
|
—
|
—
|
AISCSOS(1)
($/ounce)
|
11.50 -
12.90
|
10.00 -
12.20
|
9.30 -
11.60
|
(1)
|
Cash Costs and
AISCSOS are non-GAAP measures. Please refer to the section
titled "Alternative Performance (non-GAAP) Measures" at the end of
this news release for further information on these
measures.
|
(2)
|
Project capital
relates to the current mine expansions at La Colorada and Dolores;
2017 is expected to be the final year of project capital related to
these expansions.
|
The following table provides the price and foreign exchange rate
assumptions used to forecast total Cash Costs and AISCSOS in the
Three-year Outlook:
|
2017, 2018 and
2019
|
Metal
prices
|
|
Silver
($/ounce)
|
17.00
|
Gold
($/ounce)
|
1,200
|
Zinc
($/tonne)
|
2,500
|
Lead
($/tonne)
|
2,100
|
Copper
($/tonne)
|
5,400
|
Average annual
exchange rates relative to 1 USD
|
|
Mexican
peso
|
20.00
|
Peruvian
sol
|
3.30
|
Argentine
peso
|
17.05
|
Bolivian
boliviano
|
7.00
|
Technical information contained in this news release with
respect to Pan American has been reviewed and approved by Martin
Wafforn, P.Eng., Senior Vice President, Technical Services &
Process Optimization, who is the Company's Qualified Person for the
purposes of National Instrument 43-101. For additional information
about the Company's material mineral properties, please refer to
the Company's Annual Information Form dated March 24, 2016, filed at www.sedar.com. For
further technical information relating to the La Colorada and Dolores expansion projects, please refer to
the National Instrument 43-101 technical reports entitled
"Technical Report - Preliminary Economic Analysis for the Expansion
of the La Colorada Mine, Zacatecas,
Mexico," with an effective date of December 31, 2013, and "Technical Report for the
Dolores Property, Chihuahua,
Mexico - Preliminary Economic Assessment of a Pulp
Agglomeration Treatment and Underground Option", with an effective
date of May 31, 2014, both of which
are filed on SEDAR at www.sedar.com. The results of preliminary
economic assessments are preliminary in nature, in that they
include inferred mineral resources that are considered too
geologically speculative to have the economic considerations
applied to them that would enable them to be categorized as mineral
reserves, and there is no certainty that the assessment will be
realized. Mineral resources that are not mineral reserves have no
demonstrated economic viability.
Conference Call on
Wednesday, February 15
Pan American will
host a conference call to discuss the unaudited results for the
fourth quarter and year-ended December 31, 2016 on Wednesday,
February 15 at 1:00 pm ET (10:00 am PT). To participate, please
dial toll-free in Canada and the U.S. at 1-800-319-4610 and
International at 604-638-5340.
A live audio webcast
will be available on the Company's website at
www.panamericansilver.com. A replay of the webcast will also be
available shortly after the call on the website.
|
About Pan American Silver
Pan American Silver Corp. is one of the largest primary silver
producers in the world. We own and operate seven mines located in
Mexico, Peru, Argentina and Bolivia. Pan American also owns several
development projects in the USA,
Mexico, Peru and Argentina. Our vision is to be the world's
pre-eminent silver producer, with a reputation for excellence in
discovery, engineering, innovation and sustainable development. The
Company is headquartered in Vancouver,
B.C. and our shares trade on NASDAQ and the Toronto Stock
Exchange under the ticker "PAAS".
For more information, visit: www.panamericansilver.com.
Alternative Performance (Non-GAAP) Measures
In this press release we refer to measures that are not
generally accepted accounting principle ("non-GAAP") financial
measures. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning as prescribed by IFRS as an indicator of
performance, and may differ from methods used by other companies
with similar descriptions. These non-GAAP financial measures
include:
- Cash costs per payable ounce of silver, net of by-product
credits ("cash costs"). Cash costs does not have a standardized
meaning prescribed by IFRS as an indicator of performance. The
Company's method of calculating cash costs may differ from the
methods used by other entities and, accordingly, the Company's cash
costs may not be comparable to similarly titled measures used by
other entities. Investors are cautioned that cash costs should not
be construed as an alternative to production costs, depreciation
and amortization, and royalties determined in accordance with IFRS
as an indicator of performance.
- Adjusted earnings (loss), and adjusted earnings (loss) per
share. The Company believes that these measures better reflect
normalized earnings as they eliminate items that may be volatile
from period to period relating to positions that will settle in
future periods, and items that are non-recurring.
- All-in sustaining costs per silver ounce sold ("AISCSOS"). The
Company has adopted AISCSOS as a measure of its consolidated
operating performance and its ability to generate cash from all
operations collectively, and the Company believes it is a more
comprehensive measure of the cost of operating our consolidated
business than traditional cash costs per payable ounce, as it
includes the cost of replacing ounces through exploration, the cost
of ongoing capital investments (sustaining capital), general and
administrative expenses, as well as other items that affect the
Company's consolidated earnings and cash flow.
Readers should refer to the "Alternative Performance (non-GAAP)
Measures" section following the Consolidated Statements of Cash
Flows in this press release for a more detailed discussion of these
and other non-GAAP measures and their calculation.
Cautionary Note Regarding Forward-Looking Statements and
Information
Certain of the statements and information in this news release
constitute "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 provincial securities laws. All statements, other than
statements of historical fact, are forward-looking statements or
information. Forward-looking statements or information in this news
release relate to, among other things: future financial or
operational performance, including our estimated production of
silver, gold and other metals in 2017 and beyond, and our estimated
Cash Costs and AISCSOS in 2017 and beyond; the ability of the
Company to successfully complete any capital investment programs
and projects, including whether on time, or on or below budget, and
the impacts of any such programs and projects on the Company,
including with respect to production and associated operational
efficiencies; the realization of benefits from any transactions and
the financial and operational impacts of any such transactions on
the Company; and the approval or the amount of any future cash
dividends.
These forward-looking statements and information reflect the
Company's current views with respect to future events and are
necessarily based upon a number of assumptions that, while
considered reasonable by the Company, are inherently subject to
significant operational, business, economic and regulatory
uncertainties and contingencies. These assumptions include: tonnage
of ore to be mined and processed; ore grades and recoveries; prices
for silver, gold and base metals remaining as estimated; currency
exchange rates remaining as estimated; capital, decommissioning and
reclamation estimates; our mineral reserve and recourse estimates
and the assumptions upon which they are based; prices for energy
inputs, labour, materials, supplies and services (including
transportation); no labour-related disruptions at any of our
operations; no unplanned delays or interruptions in scheduled
production; all necessary permits, licenses and regulatory
approvals for our operations are received in a timely manner; and
our ability to comply with environmental, health and safety laws.
The foregoing list of assumptions is not exhaustive.
The Company cautions the reader that forward-looking statements
and information involve known and unknown risks, uncertainties and
other factors that may cause actual results and developments to
differ materially from those expressed or implied by such
forward-looking statements or information contained in this news
release and the Company has made assumptions and estimates based on
or related to many of these factors. Such factors include, without
limitation: fluctuations in silver, gold and base metal prices;
fluctuations in prices for energy inputs, labour, materials,
supplies and services (including transportation); fluctuations in
currency markets (such as the Canadian Dollar, Peruvian Sol,
Mexican Peso, Argentine Peso and Bolivian Boliviano versus the U.S.
Dollar); operational risks and hazards inherent with the business
of mining (including environmental accidents and hazards,
industrial accidents, equipment breakdown, unusual or unexpected
geological or structural formations, cave-ins, flooding and severe
weather); risks relating to the credit worthiness or financial
condition of suppliers, refiners and other parties with whom the
Company does business; inadequate insurance, or inability to obtain
insurance, to cover these risks and hazards; employee relations;
relationships with, and claims by, local communities and indigenous
populations; our ability to obtain all necessary permits, licenses
and regulatory approvals in a timely manner; changes in laws,
regulations and government practices in the jurisdictions where we
operate, including environmental, export and import laws and
regulations; legal restrictions relating to mining, including in
Chubut, Argentina; risks relating
to expropriation; diminishing quantities or grades of mineral
reserves as properties are mined; increased competition in the
mining industry for equipment and qualified personnel; and those
factors identified under the caption "Risks Related to Pan
American's Business" in the Company's most recent form 40-F and
Annual Information Form filed with the United States Securities and
Exchange Commission and Canadian provincial securities regulatory
authorities, respectively. Although the Company has attempted to
identify important factors that could cause actual results to
differ materially, there may be other factors that cause results
not to be as anticipated, estimated, described or intended.
Investors are cautioned against undue reliance on forward-looking
statements or information. Forward-looking statements and
information are designed to help readers understand management's
current views of our near and longer term prospects and may not be
appropriate for other purposes. The Company does not intend, nor
does it assume any obligation to update or revise forward-looking
statements or information, whether as a result of new information,
changes in assumptions, future events or otherwise, except to the
extent required by applicable law.
Pan American
Silver Corp.
|
|
|
|
Consolidated
Statements of Financial Position
|
|
|
|
As at December 31,
2016 and 2015
|
|
|
|
(Unaudited in
thousands of U.S. dollars)
|
|
|
|
|
|
|
|
|
|
December 31,
2016
|
December 31,
2015
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
|
$
|
180,881
|
$
|
133,963
|
Short-term
investments
|
|
36,729
|
92,678
|
Trade and other
receivables
|
|
130,117
|
87,041
|
Income taxes
receivable
|
|
17,460
|
27,373
|
Inventories
|
|
237,329
|
204,361
|
Prepaid expenses and
other current assets
|
|
10,337
|
6,748
|
|
|
612,853
|
552,164
|
Non-current
assets
|
|
|
|
Mineral properties,
plant and equipment
|
|
1,222,727
|
1,145,221
|
Long-term refundable
tax
|
|
7,664
|
8,994
|
Deferred tax
assets
|
|
1,727
|
3,730
|
Investment in
associates
|
|
49,734
|
1,450
|
Other
assets
|
|
379
|
421
|
Goodwill
|
|
3,057
|
3,057
|
Total
Assets
|
|
$
|
1,898,141
|
$
|
1,715,037
|
|
|
|
|
Liabilities
|
|
|
|
Current
liabilities
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
|
143,502
|
$
|
112,829
|
Loans
payable
|
|
—
|
19,578
|
Derivative financial
instruments
|
|
2,815
|
2,835
|
Provisions
|
|
8,499
|
8,979
|
Current portion of
finance lease
|
|
3,559
|
2,238
|
Income tax
payable
|
|
25,911
|
13,481
|
|
|
184,286
|
159,940
|
Non-current
liabilities
|
|
|
|
Provisions
|
|
51,444
|
45,892
|
Deferred tax
liabilities
|
|
170,863
|
142,127
|
Long-term portion of
finance lease
|
|
3,542
|
1,759
|
Long-term
debt
|
|
36,200
|
36,200
|
Deferred
revenue
|
|
11,561
|
—
|
Other long-term
liabilities
|
|
27,408
|
30,503
|
Share purchase
warrants
|
|
13,833
|
—
|
Total
Liabilities
|
|
499,137
|
416,421
|
|
|
|
|
Equity
|
|
|
|
Capital and
reserves
|
|
|
|
Issued
capital
|
|
2,303,978
|
2,298,390
|
Share option
reserve
|
|
22,946
|
22,829
|
Investment
revaluation reserve
|
|
434
|
(458)
|
Deficit
|
|
(931,060)
|
(1,023,539)
|
Total Equity
attributable to equity holders of the Company
|
|
1,396,298
|
1,297,222
|
Non-controlling
interests
|
|
2,706
|
1,394
|
Total
Equity
|
|
1,399,004
|
1,298,616
|
Total Liabilities
and Equity
|
|
$
|
1,898,141
|
$
|
1,715,037
|
Pan American
Silver Corp.
|
|
|
|
Consolidated
Income Statements
|
|
|
|
(Unaudited in
thousands of U.S. dollars, except for earnings per
share)
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
|
2016
|
2015
|
2016
|
2015
|
Revenue
|
|
$
|
190,596
|
$
|
162,960
|
$
|
774,775
|
$
|
674,688
|
Cost of
sales
|
|
|
|
|
|
|
Production
costs
|
|
(110,466)
|
(127,873)
|
(428,333)
|
(532,031)
|
|
Depreciation and
amortization
|
|
(23,032)
|
(36,917)
|
(115,955)
|
(150,845)
|
|
Royalties
|
|
(8,142)
|
(5,941)
|
(31,608)
|
(23,901)
|
|
|
(141,640)
|
(170,731)
|
(575,896)
|
(706,777)
|
Mine operating
earnings (loss)
|
|
48,956
|
(7,771)
|
198,879
|
(32,089)
|
|
|
|
|
|
|
General and
administrative
|
|
(5,592)
|
(5,890)
|
(23,663)
|
(18,027)
|
Exploration and
project development
|
|
(3,068)
|
(2,320)
|
(11,334)
|
(11,940)
|
Foreign exchange
losses
|
|
(4,441)
|
(3,971)
|
(9,054)
|
(13,004)
|
Impairment
charge
|
|
—
|
(121,512)
|
—
|
(150,268)
|
Losses on commodity,
diesel fuel swaps, and foreign currency contracts
|
|
(1,710)
|
(1,999)
|
(4,944)
|
(324)
|
Gain on sale of
mineral properties, plant and equipment
|
|
157
|
38
|
25,100
|
372
|
Share of loss from
associate and dilution gain
|
|
8,484
|
—
|
7,946
|
—
|
Other income
(expense)
|
|
2,716
|
(442)
|
1,542
|
(4,762)
|
Earnings (loss)
from operations
|
|
45,502
|
(143,867)
|
184,472
|
(230,042)
|
|
|
|
|
|
|
Gain on
derivatives
|
|
—
|
4
|
—
|
278
|
Investment
income
|
|
371
|
1,394
|
1,350
|
2,461
|
Interest and finance
expense
|
|
(2,730)
|
(2,529)
|
(9,551)
|
(8,452)
|
Earnings (loss)
before income taxes
|
|
43,143
|
(144,998)
|
176,271
|
(235,755)
|
Income taxes
(expense) recovery
|
|
(20,859)
|
8,040
|
(74,446)
|
4,199
|
Net income (loss)
for the period
|
|
$
|
22,284
|
$
|
(136,958)
|
$
|
101,825
|
$
|
(231,556)
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
|
Equity holders of the
Company
|
|
$
|
21,777
|
$
|
(132,909)
|
$
|
100,085
|
$
|
(226,650)
|
|
Non-controlling
interests
|
|
507
|
(4,049)
|
1,740
|
(4,906)
|
|
|
$
|
22,284
|
$
|
(136,958)
|
$
|
101,825
|
$
|
(231,556)
|
Earnings (loss)
per share attributable to common shareholders
|
|
|
|
|
|
Basic earnings (loss)
per share
|
|
$
|
0.14
|
$
|
(0.88)
|
$
|
0.66
|
$
|
(1.49)
|
Diluted earnings
(loss) per share
|
|
$
|
0.14
|
$
|
(0.88)
|
$
|
0.66
|
$
|
(1.49)
|
Weighted average
shares outstanding (in 000's) Basic
|
|
152,263
|
151,715
|
152,118
|
151,664
|
Weighted average
shares outstanding (in 000's) Diluted
|
|
152,669
|
151,715
|
152,504
|
151,664
|
Consolidated
Statements of Comprehensive Earnings (Loss)
|
|
|
|
(Unaudited in
thousands of U.S. dollars)
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
|
2016
|
2015
|
2016
|
2015
|
Net income (loss) for
the period
|
|
$
|
22,284
|
$
|
(136,958)
|
$
|
101,825
|
$
|
(231,556)
|
Items that may be
reclassified subsequently to net earnings:
|
|
|
|
|
|
|
Unrealized net
(losses) gains on available for sale securities
(net of zero dollars tax in 2016 and 2015)
|
|
(2,151)
|
(256)
|
912
|
(1,459)
|
|
Reclassification
adjustment for net (losses) gains on available for sale securities
included
in earnings (net of zero dollars tax in 2016 and 2015)
|
|
(27)
|
359
|
(20)
|
1,486
|
Total
comprehensive income (loss) for the period
|
|
$
|
20,106
|
$
|
(136,855)
|
$
|
102,717
|
$
|
(231,529)
|
|
|
|
|
|
|
Total
comprehensive income (loss) attributable to:
|
|
|
|
|
|
Equity holders of the
Company
|
|
$
|
19,599
|
$
|
(132,806)
|
$
|
100,977
|
$
|
(226,623)
|
Non-controlling
interests
|
|
507
|
(4,049)
|
1,740
|
(4,906)
|
Total
comprehensive income (loss) for the period
|
|
$
|
20,106
|
$
|
(136,855)
|
$
|
102,717
|
$
|
(231,529)
|
Pan American
Silver Corp.
|
|
|
|
Consolidated
Statements of Cash Flows
|
|
|
|
(Unaudited in
thousands of U.S. dollars)
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
|
2016
|
2015
|
2016
|
2015
|
Cash flow from
operating activities
|
|
|
|
|
|
Net earnings (loss)
for the period
|
|
$
|
22,284
|
$
|
(136,958)
|
$
|
101,825
|
$
|
(231,556)
|
|
|
|
|
|
|
Current income tax
expense
|
|
9,841
|
7,114
|
44,031
|
15,854
|
Deferred income tax
expense (recovery)
|
|
11,018
|
(15,154)
|
30,415
|
(20,053)
|
Interest
expense
|
|
891
|
1,166
|
2,115
|
3,640
|
Depreciation and
amortization
|
|
23,032
|
36,917
|
115,955
|
150,845
|
Impairment
charge
|
|
—
|
121,512
|
—
|
150,268
|
Accretion on closure
and decommissioning provision
|
|
1,090
|
810
|
4,363
|
3,239
|
Unrealized losses
(gains) on foreign exchange
|
|
4,139
|
(1,319)
|
5,759
|
860
|
Share-based
compensation expense
|
|
586
|
226
|
3,826
|
2,569
|
Losses on commodity,
diesel fuel swaps, and foreign currency contracts
|
|
1,710
|
1,999
|
4,944
|
324
|
Gain on
derivatives
|
|
—
|
(4)
|
—
|
(278)
|
Losses from
investment in associates and dilution gain
|
|
(8,484)
|
—
|
(7,946)
|
—
|
Gain on sale of
mineral properties, plant and equipment
|
|
(157)
|
(38)
|
(25,100)
|
(372)
|
Net realizable value
adjustment for inventories
|
|
(10,715)
|
5,028
|
(42,815)
|
10,861
|
Changes in non-cash
operating working capital
|
|
2,283
|
6,064
|
(5,545)
|
19,840
|
Operating cash
flows before interest and income taxes
|
|
57,518
|
27,363
|
231,827
|
106,041
|
|
|
|
|
|
|
Interest
paid
|
|
(1,800)
|
(823)
|
(2,553)
|
(4,472)
|
Interest
received
|
|
406
|
102
|
1,382
|
1,012
|
Income taxes
paid
|
|
(10,456)
|
(3,241)
|
(15,852)
|
(13,889)
|
Net cash generated
from operating activities
|
|
$
|
45,668
|
$
|
23,401
|
$
|
214,804
|
$
|
88,692
|
|
|
|
|
|
|
Cash flow from
investing activities
|
|
|
|
|
|
Payments for mineral
properties, plant and equipment
|
|
$
|
(56,477)
|
$
|
(53,705)
|
$
|
(202,661)
|
$
|
(146,735)
|
Net (payments)
proceeds from sales of short term investments
|
|
(3,199)
|
18,248
|
56,870
|
91,296
|
Proceeds from sale of
mineral properties, plant and equipment
|
|
738
|
103
|
16,319
|
647
|
Net (payments)
proceeds from commodity, diesel fuel swaps, and foreign currency
contracts
|
|
(2,145)
|
990
|
(4,965)
|
2,511
|
Other
payments
|
|
(5,460)
|
(666)
|
(5,460)
|
(111)
|
Net cash used in
investing activities
|
|
$
|
(66,543)
|
$
|
(35,030)
|
$
|
(139,897)
|
$
|
(52,392)
|
|
|
|
|
|
|
Cash flow from
financing activities
|
|
|
|
|
|
Proceeds from issue
of equity shares
|
|
$
|
96
|
$
|
—
|
$
|
2,399
|
$
|
—
|
Distributions to
non-controlling interests
|
|
(107)
|
(16)
|
(428)
|
(545)
|
Dividends
paid
|
|
(1,903)
|
(7,579)
|
(7,606)
|
(41,703)
|
Payment of
Convertible Debenture
|
|
—
|
(36,235)
|
—
|
(36,235)
|
Proceeds from credit
facility
|
|
—
|
36,200
|
—
|
36,200
|
(Payment of) proceeds
from short term loans
|
|
(5,172)
|
(367)
|
(19,536)
|
1,978
|
Payment of equipment
leases
|
|
(725)
|
(571)
|
(3,047)
|
(7,531)
|
Net cash used in
financing activities
|
|
$
|
(7,811)
|
$
|
(8,568)
|
$
|
(28,218)
|
$
|
(47,836)
|
Effects of exchange
rate changes on cash and cash equivalents
|
|
2
|
(1,139)
|
229
|
(694)
|
Net (decrease)
increase in cash and cash equivalents
|
|
(28,684)
|
(21,336)
|
46,918
|
(12,230)
|
Cash and cash
equivalents at the beginning of the period
|
|
209,565
|
155,299
|
133,963
|
146,193
|
Cash and cash
equivalents at the end of the period
|
|
$
|
180,881
|
$
|
133,963
|
$
|
180,881
|
$
|
133,963
|
ALTERNATIVE PERFORMANCE (NON-GAAP) MEASURES
We believe that AISCSOS reflects a comprehensive measure of the
full cost of operating our consolidated business given it includes
the cost of replacing ounces through exploration, the cost of
ongoing capital investments (sustaining capital), general and
administrative expenses, as well as other items that affect the
Company's consolidated earnings and cash flow. To facilitate a
better understanding of this measure as calculated by the Company,
the following table provides the detailed reconciliation of this
measure to the applicable cost items, as reported in the
consolidated income statements for the respective periods:
All-In Sustaining
Cost per Silver Ounce Sold
|
|
|
|
(Unaudited in
thousands of U.S. dollars)
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
(In thousands of
USD, except as noted)
|
|
2016
|
2015
|
2016
|
2015
|
Direct operating
costs
|
|
$
|
120,491
|
$
|
122,845
|
$
|
472,801
|
$
|
521,169
|
Net realizable value
("NRV") inventory adjustments
|
|
(10,710)
|
5,028
|
(42,810)
|
10,861
|
Production
costs(1)
|
|
$
|
109,781
|
$
|
127,873
|
$
|
429,991
|
$
|
532,031
|
Royalties
|
|
8,142
|
5,941
|
31,608
|
23,901
|
Smelting, refining
and other direct selling charges(2)
|
|
20,656
|
24,995
|
80,319
|
90,858
|
Less by-product
credits(2)
|
|
(109,571)
|
(92,138)
|
(424,442)
|
(377,954)
|
Cash cost of sales
net of by-products (3)
|
|
$
|
29,009
|
$
|
66,671
|
$
|
117,476
|
$
|
268,835
|
Sustaining
capital(4)
|
|
$
|
24,976
|
$
|
23,476
|
$
|
89,394
|
$
|
73,701
|
Exploration and
project development
|
|
3,068
|
2,320
|
11,334
|
11,940
|
Reclamation cost
accretion
|
|
1,090
|
810
|
4,363
|
3,239
|
General &
administrative expense
|
|
5,592
|
5,890
|
23,663
|
18,027
|
All-in sustaining
costs(3)
|
A
|
$
|
63,735
|
$
|
99,167
|
$
|
246,230
|
$
|
375,744
|
Payable ounces
sold (in thousands)
|
B
|
6,138.2
|
6,719.5
|
24,199.5
|
25,179.8
|
All-in sustaining
cost per silver ounce sold, net of by-products
|
A/B
|
$
|
10.38
|
$
|
14.76
|
$
|
10.17
|
$
|
14.92
|
All-in sustaining
cost per silver ounce sold, net of by-products (excludes NRV)
adjustments)
|
|
$
|
12.13
|
$
|
14.01
|
$
|
11.94
|
$
|
14.49
|
(1)
|
For the purposes of
AISCSOS, Alamo Dorado production costs for the three and twelve
month periods ended December 31, 2016 have been decreased by $0.6
million and increased by $1.7 million, respectively, to exclude
non-cash adjustments to the closure and decommissioning liabilities
that are included in production costs as presented in the unaudited
consolidated statements of income (loss).
|
(2)
|
Included in the
revenue line of the unaudited condensed consolidated interim
financial statements included in this press release and are
reflective of realized metal prices for the applicable
periods.
|
(3)
|
Totals may not add
due to rounding.
|
(4)
|
Please refer to the
table below.
|
As part of the AISCSOS measure, sustaining capital is included
while expansionary or acquisition capital (referred to by the
Company as investment capital) is not. Inclusion of sustaining
capital only is a better measure of capital costs associated with
current ounces sold as opposed to investment capital, which is
expected to increase future production. For the periods under
review, the below noted items associated with the La Colorada expansion project, and
Dolores' leach pad and other
expansionary expenditures are considered investment capital
projects.
Sustaining
Capital
|
|
|
(Unaudited in
thousands of U.S. dollars)
|
|
|
|
|
|
Reconciliation of
payments for mineral property,
plant and equipment and sustaining capital
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
(in thousands of
USD)
|
2016
|
2015
|
2016
|
2015
|
Payments for mineral
properties, plant and equipment(1)
|
$
|
56,477
|
$
|
53,705
|
$
|
202,661
|
$
|
146,735
|
Add/(Subtract)
|
|
|
|
|
Advances received for
leases
|
2,213
|
2,571
|
6,151
|
3,491
|
Non-Sustaining
capital (Dolores, La Colorada projects, and other)
|
(33,714)
|
(32,800)
|
(119,418)
|
(76,524)
|
Sustaining
Capital(2)
|
24,976
|
$
|
23,476
|
89,394
|
$
|
73,702
|
(1)
|
As presented on the
unaudited condensed consolidated interim financial statements
included in this press release.
|
(2)
|
Totals may not add
due to rounding.
|
All-In Sustaining Cost per Silver Ounce Sold per
mine
(Unaudited in thousands of U.S. dollars)
|
Three months ended
December 31, 2016
|
(In thousands of
USD, except as noted)
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
PASCORP
|
Consolidated
|
Direct operating
costs
|
14,674
|
28,664
|
7,266
|
17,991
|
15,547
|
10,016
|
26,331
|
—
|
120,491
|
NRV inventory
adjustments
|
—
|
(6,350)
|
2,224
|
—
|
—
|
—
|
(6,584)
|
—
|
(10,710)
|
Production
costs
|
14,674
|
22,314
|
9,490
|
17,991
|
15,547
|
10,016
|
19,747
|
—
|
109,781
|
Royalties
|
135
|
1,604
|
33
|
—
|
—
|
5,598
|
772
|
—
|
8,142
|
Smelting, refining
and other direct selling charges
|
3,712
|
23
|
125
|
7,735
|
5,643
|
4,634
|
(1,215)
|
—
|
20,656
|
Less by-product
credits
|
(12,238)
|
(32,868)
|
(1,609)
|
(21,206)
|
(18,379)
|
(5,372)
|
(17,898)
|
—
|
(109,571)
|
Cash cost of sales
net of by-products(1)
|
6,283
|
(8,927)
|
8,039
|
4,520
|
2,812
|
14,876
|
1,406
|
—
|
29,009
|
Sustaining
capital
|
2,229
|
10,772
|
—
|
4,355
|
4,892
|
1,631
|
1,097
|
—
|
24,976
|
Exploration and
project development
|
31
|
628
|
—
|
576
|
109
|
—
|
—
|
1,723
|
3,068
|
Reclamation cost
accretion
|
72
|
179
|
104
|
126
|
86
|
54
|
433
|
37
|
1,090
|
General &
administrative expense
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
5,592
|
5,592
|
All-in sustaining
costs(1)
|
8,615
|
2,652
|
8,144
|
9,576
|
7,899
|
16,561
|
2,935
|
7,352
|
63,735
|
Payable ounces
sold
|
1,561,267
|
895,000
|
286,303
|
758,626
|
525,771
|
1,332,270
|
779,002
|
—
|
6,138,240
|
|
|
|
|
|
|
|
|
|
|
All-in sustaining
cost per silver ounce sold, net of by-products
|
$
|
5.52
|
$
|
2.96
|
$
|
28.44
|
$
|
12.62
|
$
|
15.02
|
$
|
12.43
|
$
|
3.77
|
$
|
—
|
$
|
10.38
|
All-in sustaining
cost per silver ounce sold, net of by-products (excludes NRV
adjustments)
|
$
|
5.52
|
$
|
10.06
|
$
|
20.68
|
$
|
12.62
|
$
|
15.02
|
$
|
12.43
|
$
|
12.22
|
$
|
—
|
$
|
12.13
|
(1)
|
Totals may not add
due to rounding.
|
|
Twelve months
ended December 31, 2016
|
(In thousands of
USD, except as noted)
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
PASCORP
|
Consolidated
|
Direct operating
costs
|
50,879
|
121,162
|
40,172
|
67,911
|
58,868
|
34,959
|
98,851
|
—
|
472,801
|
NRV inventory
adjustments
|
|
(22,434)
|
1,173
|
|
|
|
(21,549)
|
—
|
(42,810)
|
Production
costs
|
50,879
|
98,728
|
41,345
|
67,911
|
58,868
|
34,959
|
77,302
|
—
|
429,991
|
Royalties
|
401
|
6,224
|
235
|
—
|
—
|
20,929
|
3,818
|
—
|
31,608
|
Smelting, refining
and other direct selling charges
|
13,554
|
107
|
376
|
32,443
|
25,702
|
15,697
|
(7,562)
|
—
|
80,319
|
Less by-product
credits
|
(34,737)
|
(123,811)
|
(13,156)
|
(77,754)
|
(74,754)
|
(15,774)
|
(84,456)
|
—
|
(424,442)
|
Cash cost of sales
net of by-products(1)
|
30,098
|
(18,751)
|
28,800
|
22,600
|
9,817
|
55,811
|
(10,898)
|
—
|
117,476
|
Sustaining
capital
|
10,545
|
48,079
|
—
|
11,994
|
10,945
|
4,963
|
2,868
|
—
|
89,394
|
Exploration and
project development
|
186
|
1,792
|
—
|
837
|
1,053
|
—
|
—
|
7,465
|
11,334
|
Reclamation cost
accretion
|
287
|
714
|
416
|
505
|
345
|
218
|
1,731
|
148
|
4,363
|
General &
administrative expense
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
23,663
|
23,663
|
All-in sustaining
costs(1)
|
41,116
|
31,834
|
29,216
|
35,935
|
22,159
|
60,991
|
(6,299)
|
31,276
|
246,229
|
Payable ounces
sold
|
5,486,434
|
3,839,000
|
1,966,899
|
3,233,249
|
2,377,241
|
4,264,089
|
3,032,604
|
—
|
24,199,515
|
|
|
|
|
|
|
|
|
|
|
All-in sustaining
cost per silver ounce sold, net of by-products
|
$
|
7.49
|
$
|
8.29
|
$
|
14.85
|
$
|
11.11
|
$
|
9.32
|
$
|
14.30
|
$
|
(2.08)
|
$
|
—
|
$
|
10.17
|
All-in sustaining
cost per silver ounce sold, net of by-products (excludes NRV
adjustments)
|
$
|
7.49
|
$
|
14.14
|
$
|
14.26
|
$
|
11.11
|
$
|
9.32
|
$
|
14.30
|
$
|
5.03
|
$
|
—
|
$
|
11.94
|
(1)
|
Totals may not add
due to rounding.
|
|
Three months ended
December 31, 2015
|
(In thousands of
USD, except as noted)
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
PASCORP
|
Consolidated
|
Direct operating
costs
|
11,454
|
29,065
|
14,034
|
16,999
|
14,707
|
11,747
|
24,837
|
—
|
122,845
|
NRV inventory
adjustments
|
—
|
3,132
|
684
|
—
|
—
|
—
|
1,212
|
—
|
5,028
|
Production
costs
|
11,454
|
32,198
|
14,718
|
16,999
|
14,707
|
11,747
|
26,049
|
—
|
127,873
|
Royalties
|
73
|
1,225
|
97
|
—
|
—
|
3,542
|
1,004
|
—
|
5,941
|
Smelting, refining
and transportation charges
|
3,009
|
31
|
252
|
7,451
|
7,711
|
4,615
|
1,926
|
—
|
24,995
|
Less by-product
credits
|
(5,415)
|
(21,110)
|
(9,369)
|
(14,752)
|
(15,587)
|
(5,031)
|
(20,874)
|
—
|
(92,138)
|
Cash cost of sales
net of by-products (1)
|
9,121
|
12,344
|
5,698
|
9,698
|
6,831
|
14,873
|
8,105
|
—
|
66,671
|
Sustaining
capital
|
2,965
|
10,064
|
—
|
4,599
|
2,516
|
996
|
2,337
|
—
|
23,476
|
Exploration and
project development
|
172
|
86
|
—
|
53
|
722
|
—
|
—
|
1,287
|
2,320
|
Reclamation cost
accretion
|
59
|
90
|
58
|
150
|
96
|
56
|
274
|
26
|
810
|
General &
administrative expense
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
5,890
|
5,890
|
All-in sustaining
costs(1)
|
12,317
|
22,585
|
5,756
|
14,500
|
10,165
|
15,925
|
10,716
|
7,202
|
99,167
|
Payable ounces
sold
|
1,262,660
|
1,048,000
|
726,214
|
773,799
|
483,481
|
1,447,582
|
977,754
|
—
|
6,719,489
|
|
|
|
|
|
|
|
|
|
|
All-in sustaining
cost per silver ounce sold, net of by-products
|
$
|
9.75
|
$
|
21.55
|
$
|
7.93
|
$
|
18.74
|
$
|
21.02
|
$
|
11.00
|
$
|
10.96
|
$
|
—
|
$
|
14.76
|
All-in sustaining
cost per silver ounce sold, net of by-products (excludes NRV
adjustments)
|
$
|
9.75
|
$
|
18.56
|
$
|
6.98
|
$
|
18.74
|
$
|
21.02
|
$
|
11.00
|
$
|
9.72
|
$
|
—
|
$
|
14.01
|
(1)
|
Totals may not add
due to rounding.
|
|
Twelve months
ended December 31, 2015
|
(In thousands of
USD, except as noted)
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
PASCORP
|
Consolidated
|
Direct operating
costs
|
48,842
|
132,343
|
60,159
|
66,878
|
66,096
|
32,211
|
114,640
|
—
|
521,169
|
NRV inventory
adjustments
|
—
|
(11,417)
|
(522)
|
—
|
—
|
—
|
22,800
|
—
|
10,861
|
Production
costs
|
48,842
|
120,926
|
59,637
|
66,878
|
66,096
|
32,211
|
137,440
|
—
|
532,031
|
Royalties
|
385
|
5,289
|
344
|
—
|
—
|
14,051
|
3,832
|
—
|
23,901
|
Smelting, refining
and transportation charges
|
11,877
|
132
|
682
|
26,986
|
31,424
|
11,147
|
8,609
|
—
|
90,858
|
Less by-product
credits
|
(22,585)
|
(96,066)
|
(23,446)
|
(58,027)
|
(68,480)
|
(13,047)
|
(96,302)
|
—
|
(377,954)
|
Cash cost of sales
net of by-products (1)
|
38,519
|
30,281
|
37,217
|
35,837
|
29,041
|
44,362
|
53,579
|
—
|
268,836
|
Sustaining
capital
|
9,869
|
25,162
|
—
|
13,610
|
7,713
|
3,286
|
14,061
|
—
|
73,701
|
Exploration and
project development
|
254
|
544
|
—
|
765
|
1,202
|
—
|
—
|
9,175
|
11,940
|
Reclamation cost
accretion
|
237
|
362
|
232
|
600
|
384
|
226
|
1,096
|
103
|
3,239
|
General &
administrative expense
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
18,027
|
18,027
|
All-in sustaining
costs(1)
|
48,879
|
56,348
|
37,450
|
50,813
|
38,339
|
47,873
|
68,736
|
27,305
|
375,744
|
Payable ounces
sold
|
5,108,985
|
4,448,000
|
2,944,491
|
3,009,185
|
1,995,307
|
4,019,265
|
3,654,556
|
—
|
25,179,788
|
|
|
|
|
|
|
|
|
|
|
All-in sustaining
cost per silver ounce sold, net of by-products
|
$
|
9.57
|
$
|
12.67
|
$
|
12.72
|
$
|
16.89
|
$
|
19.21
|
$
|
11.91
|
$
|
18.81
|
$
|
—
|
$
|
14.92
|
All-in sustaining
cost per silver ounce sold, net of by-products (excludes NRV
adjustments)
|
$
|
9.57
|
$
|
15.24
|
$
|
12.90
|
$
|
16.89
|
$
|
19.21
|
$
|
11.91
|
$
|
12.57
|
$
|
—
|
$
|
14.49
|
(1)
|
Totals may not add
due to rounding.
|
- Cash Costs per Ounce of Silver, net of by-product
credits
Pan American produces by-product metals incidentally to our
silver mining activities. We have adopted the practice of
calculating the net cost of producing an ounce of silver, our
primary payable metal, after deducting revenues gained from
incidental by-product production, as a performance measure. This
performance measurement has been commonly used in the mining
industry for many years and was developed as a relatively simple
way of comparing the net production costs of the primary metal for
a specific period against the prevailing market price of that
metal.
Cash costs per ounce metrics, net of by-product credits, were
utilized extensively in our internal decision making processes. We
believe they are useful to investors as these metrics facilitate
comparison, on a mine by mine basis, notwithstanding the unique mix
of incidental by-product production at each mine, of our
operations' relative performance on a period by period basis, and
against the operations of our peers in the silver industry on a
consistent basis. Cash costs per ounce is conceptually understood
and widely reported in the silver mining industry. However, cash
cost per ounce does not have a standardized meaning prescribed by
GAAP and the Company's method of calculating cash costs may differ
from the methods used by other entities.
To facilitate a better understanding of these measures as
calculated by the Company, the following table provides the
detailed reconciliation of these measures to the production costs,
as reported in the unaudited consolidated income statements for the
respective periods:
|
|
|
|
Total Cash Costs
per ounce of Payable Silver, net of
by-product credits
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
(in thousands of
U.S. dollars except as noted)
|
|
2016
|
2015
|
2016
|
2015
|
Production
costs
|
|
110,466
|
$
|
127,873
|
$
|
428,333
|
$
|
532,031
|
Add/(Subtract)
|
|
|
|
|
|
Royalties
|
|
8,142
|
5,941
|
31,608
|
23,901
|
Smelting, refining,
and transportation charges
|
|
22,204
|
24,319
|
91,371
|
94,804
|
Worker's
participation and voluntary (payments) recoveries
|
|
(876)
|
62
|
(3,397)
|
(147)
|
Change in
inventories
|
|
(3,473)
|
(3,115)
|
(11,937)
|
(19,114)
|
Other
|
|
363
|
882
|
(5,655)
|
(6,537)
|
Non-controlling
interests (1)
|
|
(811)
|
(1,072)
|
(3,358)
|
(4,331)
|
Metal inventories
recovery (write-down)
|
|
10,710
|
(5,028)
|
42,810
|
(10,861)
|
Cash Operating
Costs before by-product credits(2)
|
|
146,725
|
149,860
|
569,775
|
609,746
|
|
Less gold
credit
|
|
(52,888)
|
(52,562)
|
(227,196)
|
(208,800)
|
|
Less zinc
credit
|
|
(28,486)
|
(15,855)
|
(93,428)
|
(66,831)
|
|
Less lead
credit
|
|
(11,226)
|
(6,477)
|
(35,890)
|
(24,488)
|
|
Less copper
credit
|
|
(14,667)
|
(17,030)
|
(63,404)
|
(71,635)
|
Cash Operating
Costs net of by-product credits (2)
|
A
|
39,457
|
57,936
|
149,857
|
237,992
|
Payable Silver
Production (koz)
|
B
|
5,924.8
|
6,370.8
|
23,817.9
|
24,530.8
|
Cash Costs per
ounce net of by-product credits
|
(A*$1000)
/B
|
$
|
6.66
|
$
|
9.09
|
$
|
6.29
|
$
|
9.70
|
|
|
(1)
|
Figures presented in
the reconciliation table above are on a 100% basis as presented in
the unaudited condensed interim consolidated financial statements
with an adjustment line item to account for the portion of the
Morococha and San Vicente mines owned by non-controlling interests,
an expense item not included in operating cash costs. The
associated tables below are for the Company's share of ownership
only.
|
(2)
|
Figures in this table
and in the associated tables below may not add due to
rounding.
|
|
Three months ended
December 31, 2016 (1) (in thousands of USD except as
noted)
|
|
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
Consolidated
Total
|
Cash Costs before
by-product credits
|
A
|
$
|
19,118
|
29,875
|
10,704
|
$
|
25,766
|
$
|
19,496
|
$
|
14,034
|
26,259
|
145,251
|
|
Less gold
credit
|
b1
|
$
|
(841)
|
$
|
(35,183)
|
$
|
(1,690)
|
$
|
—
|
$
|
(165)
|
$
|
(86)
|
$
|
(14,905)
|
$
|
(52,870)
|
|
Less zinc
credit
|
b2
|
(7,801)
|
—
|
—
|
(11,056)
|
(7,361)
|
(1,568)
|
—
|
(27,787)
|
|
Less lead
credit
|
b3
|
(3,513)
|
—
|
—
|
(6,005)
|
(1,444)
|
(136)
|
—
|
(11,098)
|
|
Less copper
credit
|
b4
|
—
|
—
|
31
|
(5,122)
|
(7,849)
|
(1,095)
|
—
|
(14,035)
|
Sub-total
by-product credits
|
B=( b1+ b2+ b3+
b4)
|
$
|
(12,155)
|
$
|
(35,183)
|
$
|
(1,659)
|
$
|
(22,183)
|
$
|
(16,819)
|
$
|
(2,885)
|
$
|
(14,905)
|
$
|
(105,790)
|
Cash Costs net of
by-product credits
|
C=(A+B)
|
$
|
6,962
|
$
|
(5,308)
|
$
|
9,046
|
$
|
3,583
|
$
|
2,676
|
$
|
11,149
|
$
|
11,354
|
$
|
39,462
|
|
|
|
|
|
|
|
|
|
|
Payable ounces of
silver (thousand)
|
D
|
1,588
|
895
|
397
|
789
|
485
|
994
|
777
|
5,925
|
|
|
|
|
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
C/D
|
$
|
4.38
|
$
|
(5.93)
|
$
|
22.80
|
$
|
4.54
|
$
|
5.52
|
$
|
11.22
|
$
|
14.61
|
$
|
6.66
|
|
|
(1)
|
Totals may not add
due to rounding.
|
|
Twelve months
ended December 31, 2016 (1) (in thousands of USD
except as noted)
|
|
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
Consolidated
Total
|
Cash Costs before
by-product credits
|
A
|
$
|
68,057
|
$
|
124,570
|
$
|
39,891
|
$
|
96,284
|
$
|
75,586
|
$
|
61,779
|
$
|
97,388
|
$
|
563,555
|
|
Less gold
credit
|
b1
|
$
|
(2,929)
|
$
|
(128,696)
|
$
|
(10,251)
|
$
|
(2)
|
$
|
(897)
|
$
|
(335)
|
$
|
(83,992)
|
$
|
(227,103)
|
|
Less zinc
credit
|
b2
|
(20,636)
|
—
|
—
|
(34,638)
|
(26,841)
|
(8,611)
|
—
|
(90,726)
|
|
Less lead
credit
|
b3
|
(10,487)
|
—
|
—
|
(18,967)
|
(5,166)
|
(795)
|
—
|
(35,415)
|
|
Less copper
credit
|
b4
|
—
|
—
|
(100)
|
(24,113)
|
(33,701)
|
(2,534)
|
—
|
(60,448)
|
Sub-total
by-product credits
|
B=( b1+ b2+ b3+
b4)
|
$
|
(34,052)
|
$
|
(128,696)
|
$
|
(10,351)
|
$
|
(77,720)
|
$
|
(66,605)
|
$
|
(12,275)
|
$
|
(83,992)
|
$
|
(413,692)
|
Cash Costs net of
by-product credits
|
C=(A+B)
|
$
|
34,004
|
$
|
(4,126)
|
$
|
29,539
|
$
|
18,565
|
$
|
8,981
|
$
|
49,504
|
$
|
13,396
|
$
|
149,862
|
|
|
|
|
|
|
|
|
|
|
Payable ounces of
silver (thousand)
|
D
|
5,531
|
3,831
|
1,844
|
3,208
|
2,132
|
4,143
|
3,130
|
23,818
|
|
|
|
|
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
C/D
|
$
|
6.15
|
$
|
(1.08)
|
$
|
16.02
|
$
|
5.79
|
$
|
4.21
|
$11.95
|
$
|
4.28
|
$
|
6.29
|
|
|
(1)
|
Totals may not add
due to rounding.
|
|
Three months ended
December 31, 2015 (1) (in thousands of USD except as
noted)
|
|
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
Consolidated
Total
|
Cash Costs before
by-product credits
|
A
|
$
|
15,861
|
$
|
31,089
|
$
|
13,353
|
$
|
23,380
|
$
|
21,143
|
$
|
14,376
|
$
|
29,203
|
148,
405
|
Less gold
credit
|
b1
|
$
|
(595)
|
$
|
(20,095)
|
$
|
(8,726)
|
$
|
(24)
|
$
|
(330)
|
$
|
(63)
|
$
|
(22,699)
|
$
|
(52,531)
|
Less zinc
credit
|
b2
|
(3,420)
|
—
|
—
|
(5,299)
|
(3,664)
|
(3,006)
|
—
|
(15,390)
|
Less lead
credit
|
b3
|
(1,956)
|
—
|
—
|
(3,107)
|
(1,040)
|
(274)
|
—
|
(6,376)
|
Less copper
credit
|
b4
|
—
|
—
|
(181)
|
(5,750)
|
(10,241)
|
—
|
—
|
(16,172)
|
Sub-total
by-product credits
|
B=( b1+ b2+ b3+
b4)
|
$
|
(5,971)
|
$
|
(20,095)
|
$
|
(8,907)
|
$
|
(14,179)
|
$
|
(15,275)
|
$
|
(3,343)
|
$
|
(22,699)
|
$
|
(90,469)
|
Cash Costs net of
by-product credits
|
C=(A+B)
|
$
|
9,890
|
$
|
10,995
|
$
|
4,446
|
$
|
9,200
|
$
|
5,868
|
$
|
11,033
|
$
|
6,505
|
$
|
57,936
|
|
|
|
|
|
|
|
|
|
|
Payable ounces of
silver (thousand)
|
D
|
1,359
|
945
|
810
|
810
|
452
|
992
|
1,003
|
6,371
|
|
|
|
|
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
C/D
|
$
|
7.28
|
$
|
11.64
|
$
|
5.49
|
$
|
11.35
|
$
|
12.99
|
$
|
11.12
|
$
|
6.48
|
$
|
9.09
|
|
|
(1)
|
Totals may not add
due to rounding.
|
|
Twelve months
ended December 31, 2015 (1) (in thousands of USD
except as noted)
|
|
|
La
Colorada
|
Dolores
|
Alamo
Dorado
|
Huaron
|
Morococha
|
San
Vicente
|
Manantial
Espejo
|
Consolidated
Total
|
Cash Costs before
by-product credits
|
A
|
$
|
61,748
|
$
|
130,918
|
$
|
57,178
|
$
|
93,503
|
$
|
88,542
|
$
|
56,262
|
$
|
115,548
|
$
|
603,698
|
|
Less gold
credit
|
b1
|
$
|
(2,586)
|
$
|
(91,551)
|
$
|
(23,187)
|
$
|
(174)
|
$
|
(1,594)
|
$
|
(241)
|
$
|
(89,320)
|
$
|
(208,654)
|
|
Less zinc
credit
|
b2
|
(14,429)
|
—
|
—
|
(21,416)
|
(17,973)
|
(10,932)
|
—
|
(64,750)
|
|
Less lead
credit
|
b3
|
(7,049)
|
—
|
—
|
(11,586)
|
(4,261)
|
(1,173)
|
—
|
(24,069)
|
|
Less copper
credit
|
b4
|
—
|
—
|
(439)
|
(27,189)
|
(40,606)
|
—
|
—
|
(68,233)
|
Sub-total
by-product credits
|
B=( b1+ b2+ b3+
b4)
|
$
|
(24,064)
|
$
|
(91,551)
|
$
|
(23,625)
|
$
|
(60,365)
|
$
|
(64,434)
|
$
|
(12,346)
|
$
|
(89,320)
|
$
|
(365,706)
|
Cash Costs net of
by-product credits
|
C=(A+B)
|
$
|
37,683
|
$
|
39,367
|
$
|
33,553
|
$
|
33,137
|
$
|
24,107
|
$
|
43,916
|
$
|
26,228
|
$
|
237,992
|
|
|
|
|
|
|
|
|
|
|
Payable ounces of
silver (thousand)
|
D
|
5,089
|
4,242
|
2,941
|
3,037
|
1,851
|
3,796
|
3,576
|
24,531
|
|
|
|
|
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
C/D
|
$
|
7.41
|
$
|
9.28
|
$
|
11.41
|
$
|
10.91
|
$
|
13.03
|
$11.57
|
$
|
7.33
|
$
|
9.70
|
|
|
(1)
|
Totals may not add
due to rounding.
|
- Adjusted Earnings and Basic Adjusted Earnings Per
Share
Adjusted earnings is a non-GAAP measure that the Company
considers to better reflect normalized earnings as it eliminates
items that may be volatile from period to period, relating to
positions which will settle in future periods, and items that are
non-recurring. Certain items that become applicable in a period may
be adjusted for, with the Company retroactively presenting
comparable periods with an adjustment for such items and
conversely, items no longer applicable may be removed from the
calculation. The Company adjusts certain items in the periods that
they occurred but does not reverse or otherwise unwind the effect
of such items in future periods.
The following table shows a reconciliation of adjusted loss and
earnings for the three and twelve months ended December 31, 2016 and 2015, to the net (loss)
earnings for each period:
Adjusted Earnings
(Loss) Reconciliation
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015(1)
|
2016
|
2015(1)
|
Net earnings (loss)
for the period
|
$
|
22,284
|
$
|
(136,958)
|
$
|
101,825
|
$
|
(231,556)
|
Adjust derivative
gain
|
—
|
(4)
|
—
|
(278)
|
Adjust impairment of
mineral properties
|
—
|
121,512
|
—
|
150,268
|
Adjust write-down of
other assets
|
—
|
2,678
|
—
|
22,812
|
Adjust unrealized
foreign exchange losses (gains)
|
4,139
|
(1,319)
|
5,759
|
860
|
Adjust net realizable
value of heap inventory
|
6,619
|
6,366
|
(872)
|
6,401
|
Adjust
unrealized loss on commodity contracts
|
(435)
|
2,989
|
(21)
|
2,835
|
Adjust share of loss
from associate and dilution gain
|
(8,484)
|
—
|
(7,946)
|
—
|
Adjust gain on sale
of assets
|
(157)
|
(38)
|
(25,100)
|
(372)
|
Adjust for effect of
taxes
|
(2,486)
|
(10,131)
|
7,204
|
(5,172)
|
Adjust for effect of
foreign exchange on taxes on above amounts
(1)
|
6,057
|
2,220
|
14,323
|
12,941
|
Adjusted loss for
the period
|
$
|
27,537
|
$
|
(12,685)
|
$
|
95,172
|
$
|
(41,261)
|
Weighted average
shares for the period
|
152,263
|
151,715
|
152,118
|
151,664
|
Adjusted loss per
share for the period
|
$
|
0.18
|
$
|
(0.08)
|
$
|
0.63
|
$
|
(0.27)
|
(1)
|
The impact of
unrealized FX changes on deferred income tax balances has
been added as a new adjusting item, for comparative purposes 2015
adjusted earning have been recalculated, and are thus
different from those originally reported. The effect of this
new adjusting item on 2015 annual and fourth quarter adjusted
earnings was an increase of $0.11 per share and $0.07 per share,
respectively, from those originally reported.
|
Mine Operating Highlights
La Colorada
mine
|
|
|
|
|
|
|
Three months
ended
December 31
|
Twelve months
ended
December 31
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled -
kt
|
154.6
|
122.7
|
528.8
|
485.4
|
Average silver grade
– grams per tonne
|
370
|
401
|
377
|
379
|
Average zinc grade -
%
|
2.79
|
2.44
|
2.63
|
2.20
|
Average lead grade -
%
|
1.31
|
1.16
|
1.31
|
1.01
|
Average silver
recovery - %
|
90.5
|
90.0
|
90.3
|
90.1
|
Average zinc recovery
- %
|
84.5
|
83.9
|
82.2
|
83.6
|
Average lead recovery
- %
|
86.7
|
87.6
|
86.5
|
86.8
|
Production:
|
|
|
|
|
|
Silver –
koz
|
1,665
|
1,423
|
5,795
|
5,327
|
|
Gold – koz
|
0.86
|
0.65
|
2.93
|
2.63
|
|
Zinc – kt
|
3.64
|
2.51
|
11.40
|
8.91
|
|
Lead – kt
|
1.76
|
1.25
|
6.00
|
4.26
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
4.38
|
$
|
7.28
|
$
|
6.15
|
$
|
7.41
|
|
|
|
|
|
AISCSOS
|
$
|
5.52
|
$
|
9.75
|
$
|
7.49
|
$
|
9.57
|
|
|
|
|
|
Payable silver
sold - koz
|
1,561
|
1,263
|
5,486
|
5,109
|
|
|
|
|
|
Sustaining capital
- ('000s)
|
$
|
2,229
|
$
|
2,965
|
$
|
10,545
|
$
|
9,869
|
Dolores
mine
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes placed -
kt
|
1,650.5
|
1,501.3
|
6,306.5
|
6,108.9
|
Average silver grade
– grams per tonne
|
43
|
36
|
37
|
44
|
Average gold grade –
grams per tonne
|
0.79
|
0.52
|
0.75
|
0.57
|
Average silver
produced to placed ratio - %
|
39.2
|
54.2
|
50.8
|
49.7
|
Average gold produced
to placed ratio - %
|
69.1
|
72.7
|
67.7
|
70.9
|
Production:
|
|
|
|
|
|
Silver –
koz
|
897
|
947
|
3,838
|
4,250
|
|
Gold – koz
|
28.83
|
18.21
|
102.76
|
79.14
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
(5.93)
|
$
|
11.64
|
$
|
(1.08)
|
$
|
9.28
|
|
|
|
|
|
AISCSOS
|
$
|
2.96
|
$
|
21.55
|
$
|
8.29
|
$
|
12.67
|
|
|
|
|
|
Payable silver
sold - koz
|
895
|
1,048
|
3,839
|
4,448
|
|
|
|
|
|
Sustaining capital
- ('000s)
|
$
|
10,772
|
$
|
10,064
|
$
|
48,079
|
$
|
25,162
|
Alamo Dorado
mine
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled -
kt
|
448.6
|
455.3
|
1,833.1
|
1,798.6
|
Average silver grade
– grams per tonne
|
40
|
64
|
45
|
62
|
Average gold grade –
grams per tonne
|
0.14
|
0.56
|
0.18
|
0.39
|
Average silver
recovery - %
|
65.2
|
86.0
|
68.8
|
82.9
|
Production:
|
|
|
|
|
|
Silver –
koz
|
401
|
818
|
1,864
|
2,970
|
|
Gold – koz
|
1.41
|
7.89
|
8.38
|
20.34
|
|
Copper –
tonnes
|
—
|
40
|
30
|
100
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
22.80
|
$
|
5.49
|
$
|
16.02
|
$
|
11.41
|
|
|
|
|
|
AISCSOS
|
$
|
28.44
|
$
|
7.93
|
$
|
14.85
|
$
|
12.72
|
|
|
|
|
|
Payable silver
sold - koz
|
286
|
726
|
1,967
|
2,944
|
|
|
|
|
|
Sustaining capital
- ('000s)
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
Huaron
mine
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled -
kt
|
229.9
|
233.0
|
904.4
|
894.5
|
Average silver grade
– grams per tonne
|
149
|
161
|
157
|
157
|
Average zinc grade -
%
|
3.12
|
2.63
|
3.01
|
2.41
|
Average lead grade -
%
|
1.59
|
1.16
|
1.51
|
1.08
|
Average copper grade
- %
|
0.78
|
0.94
|
0.90
|
0.97
|
Average silver
recovery - %
|
85.3
|
82.6
|
84.1
|
83.2
|
Average zinc recovery
- %
|
74.6
|
65.5
|
74.3
|
63.8
|
Average lead recovery
- %
|
81.4
|
72.8
|
79.4
|
73.1
|
Average copper
recovery - %
|
72.1
|
76.9
|
75.5
|
78.5
|
Production:
|
|
|
|
|
|
Silver –
koz
|
935
|
987
|
3,812
|
3,705
|
|
Gold – koz
|
0.20
|
0.24
|
0.81
|
1.05
|
|
Zinc – kt
|
5.31
|
3.98
|
19.94
|
13.55
|
|
Lead – kt
|
2.97
|
1.96
|
10.72
|
6.92
|
|
Copper –
kt
|
1.27
|
1.67
|
6.07
|
6.70
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
4.54
|
$
|
11.35
|
$
|
5.79
|
$
|
10.91
|
|
|
|
|
|
AISCSOS
|
$
|
12.62
|
$
|
18.74
|
$
|
11.11
|
$
|
16.89
|
|
|
|
|
|
Payable silver
sold – koz
|
759
|
774
|
3,233
|
3,009
|
|
|
|
|
|
Sustaining capital
- ('000s)
|
$
|
4,355
|
$
|
4,599
|
$
|
11,994
|
$
|
13,610
|
Morococha mine
(reflects Pan American's 92.3% interest)
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled –
kt
|
164.2
|
165.6
|
672.8
|
637.2
|
Average silver grade
– grams per tonne
|
126
|
117
|
135
|
124
|
Average zinc grade
- %
|
2.81
|
2.83
|
3.15
|
2.83
|
Average lead grade
- %
|
0.71
|
0.70
|
0.75
|
0.71
|
Average copper grade
- %
|
1.23
|
1.61
|
1.44
|
1.52
|
Average silver
recovery - %
|
88.6
|
84.7
|
88.4
|
85.2
|
Average zinc recovery
- %
|
76.2
|
60.2
|
73.2
|
64.1
|
Average lead recovery
- %
|
62.9
|
58.1
|
60.0
|
59.0
|
Average copper
recovery - %
|
82.6
|
86.3
|
82.6
|
85.8
|
Production:
|
|
|
|
|
|
Silver –
koz
|
578
|
524
|
2,541
|
2,165
|
|
Gold – koz
|
0.43
|
0.78
|
2.14
|
3.22
|
|
Zinc – kt
|
3.48
|
2.76
|
15.46
|
11.37
|
|
Lead – kt
|
0.72
|
0.66
|
2.94
|
2.56
|
|
Copper –
kt
|
1.60
|
2.29
|
7.74
|
8.16
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
5.52
|
$
|
12.99
|
$
|
4.21
|
$
|
13.03
|
|
|
|
|
|
AISCSOS
|
$
|
15.02
|
$
|
21.02
|
$
|
9.32
|
$
|
19.21
|
|
|
|
|
|
Payable silver
sold (100%) - koz
|
526
|
483
|
2,377
|
1,995
|
|
|
|
|
|
Sustaining capital
(100%) - ('000s)
|
$
|
4,892
|
$
|
2,516
|
$
|
10,945
|
$
|
7,713
|
San Vicente
mine (reflects Pan American's 95% interest)
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled –
kt
|
81.5
|
86.0
|
338.9
|
330.8
|
Average silver grade
– grams per tonne
|
431
|
428
|
443
|
422
|
Average zinc grade -
%
|
1.41
|
3.30
|
2.05
|
2.65
|
Average silver
recovery - %
|
93.9
|
91.2
|
93.2
|
92.6
|
Average zinc recovery
- %
|
64.3
|
77.8
|
73.0
|
77.6
|
Production:
|
|
|
|
|
|
Silver –
koz
|
1,050
|
1,081
|
4,433
|
4,118
|
|
Zinc – kt
|
0.75
|
2.22
|
5.08
|
6.82
|
|
Lead - kt
|
0.09
|
0.22
|
0.59
|
0.84
|
|
Copper –
kt
|
0.23
|
—
|
0.55
|
—
|
|
|
|
|
|
Cash cost per
ounce net of by-products
|
$
|
11.22
|
$
|
11.12
|
$
|
11.95
|
$
|
11.57
|
|
|
|
|
|
AISCSOS
|
$
|
12.43
|
$
|
11.00
|
$
|
14.30
|
$
|
11.91
|
|
|
|
|
|
Payable silver
sold (100%) - koz
|
1,332
|
1,448
|
4,264
|
4,019
|
|
|
|
|
|
Sustaining capital
(100%) - ('000s)
|
$
|
1,631
|
$
|
996
|
$
|
4,963
|
$
|
3,286
|
Manantial
Espejo mine
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2016
|
2015
|
2016
|
2015
|
Tonnes milled -
kt
|
205.0
|
207.7
|
753.6
|
774.9
|
Average silver grade
– grams per tonne
|
130
|
164
|
143
|
158
|
Average gold grade –
grams per tonne
|
2.00
|
3.19
|
2.94
|
3.28
|
Average silver
recovery - %
|
91.1
|
91.7
|
90.2
|
91.6
|
Average gold recovery
- %
|
92.8
|
94.6
|
93.8
|
95.1
|
Production:
|
|
|
|
|
Silver –
koz
|
779
|
1,005
|
3,136
|
3,583
|
Gold – koz
|
12.21
|
20.46
|
66.89
|
77.32
|
Cash cost per
ounce net of by-products
|
$
|
14.61
|
$
|
6.48
|
$
|
4.28
|
$
|
7.33
|
AISCSOS
|
$
|
3.77
|
$
|
10.96
|
$
|
(2.08)
|
$
|
18.81
|
Payable silver
sold - koz
|
779
|
978
|
3,033
|
3,655
|
Sustaining capital
- ('000s)
|
$
|
1,097
|
$
|
2,337
|
$
|
2,868
|
$
|
14,061
|
SOURCE Pan American Silver Corp.