TIDMWPM
RNS Number : 8972X
Wheaton Precious Metals Corp.
07 May 2021
May 6, 2021 TSX | NYSE | LSE: WPM
Vancouver, British Columbia
Designated News Release
FIRST quarter 2021 financial results
WHEATON PRECIOUS METALS Announces
record revenue for THE FIRST QUARTER OF 2021
"Wheaton's first quarter results illustrate the strength and
growth profile of our diversified, high-quality portfolio with
record revenue achieved and over $230 million in operating cash
flow generated. As a result of these strong results, we have
increased our dividend for the third quarter in a row and now have
net cash on the balance sheet, which we will look to deploy to
further grow our sector-leading portfolio," said Randy Smallwood,
President and Chief Executive Officer of Wheaton Precious Metals.
"We are excited to report our first production of cobalt from the
Voisey's Bay mine in Canada and look forward to having many more
years of what we believe is the most environmentally friendly,
socially responsible cobalt production in the world. In addition,
in the first quarter, we added a new precious metals stream on a
top-tier copper development project, Santo Domingo, which should
provide additional growth. Our corporate development team remains
exceptionally busy evaluating a host of new opportunities, and as
always, Wheaton is focused on ensuring our growth is both accretive
and sustainable for all of our stakeholders."
First Quarter 2021 Highlights:
-- $232 million in operating cash flow during the first quarter.
-- Record quarterly revenue of $324 million during the first quarter.
-- Revolving facility fully repaid during the quarter, resulting in $191 million of cash on hand.
-- Declared quarterly dividend (1) of $0.14 per common share
representing the third quarterly dividend increase in a row and a
40% increase relative to Q1 2020.
-- First cobalt and silver deliveries from the Voisey's Bay and Cozamin mines, respectively.
-- New precious metal purchase agreement in respect to the Santo Domingo project.
Operational Overview
(all figures in US dollars unless otherwise noted) Q1 2021 Q1 2020 Change
---------------------------------------------------- --- ---------- ------------- --------
Units produced
Gold ounces 77,733 94,999 (18.2)%
Silver ounces 6,754 6,704 0.7 %
Palladium ounces 5,769 5,312 8.6 %
Cobalt pounds 1,160,921 - n.a.
Gold equivalent (2) 190,359 194,901 (2.3)%
Units sold
Gold ounces 75,104 100,405 (25.2)%
Silver ounces 6,657 4,928 35.1 %
Palladium ounces 5,131 4,938 3.9 %
Cobalt pounds 132,277 - n.a.
Gold equivalent (2) 175,419 175,154 0.2 %
---------------------------------------------------------- ---------- ------------- --------
Revenue $ 324,119 $ 254,789 27.2 %
Net earnings $ 162,002 $ 94,896 71 %
Per share $ 0.360 $ 0.212 69.8 %
Adjusted net earnings (1) $ 161,132 $ 104,533 54.1 %
Per share (1) $ 0.358 $ 0.233 53.6 %
Operating cash flows $ 232,154 $ 177,588 30.7 %
Per share (1) $ 0.516 $ 0.397 30.0 %
----------------------------------------------------- ---------- ------------- --------
All amounts in thousands except gold, palladium & gold
equivalent ounces and cobalt pounds produced & sold, per
ounce/pound amounts & per share amounts. [1] [2]
Financial Review
Revenues
Revenue was $324 million in the first quarter of 2021
representing a 27% increase from the first quarter of 2020 due
primarily to a 27% increase in the average realized gold
equivalent(2) price.
Cash Costs and Margin
Average cash costs(1) in the first quarter of 2021 were $449 per
gold equivalent(2) ounce as compared to $382 in Q1 2020. This
resulted in a cash operating margin(1) of $1,399 per gold
equivalent(2) ounce sold, an increase of 30% as compared with the
first quarter of 2020.
Balance Sheet (at March 31, 2021 )
-- Approximately $191 million of cash on hand.
-- The Company's $2 billion revolving term loan (the "Revolving Facility") fully repaid.
-- During Q1 2021, the company received $112 million in proceeds
from the sale of its remaining equity investment in First Majestic
Silver Corp. ("First Majestic").
-- During Q1 2021, the Company has repaid $195 million under the Revolving Facility.
-- The average effective interest rate for Q1 2021 was 1.17%.
First Quarter Asset Highlights
Salobo: In the first quarter of 2021, Salobo produced 46,600
ounces of attributable gold, a decrease of approximately 25%
relative to the first quarter of 2020 due to lower throughput.
According to Vale S.A.'s ("Vale") First Quarter 2021 Production and
Sales Report, throughput at Salobo was impacted due to changes in
maintenance routines which restricted mine movement, with further
impacts on feed grade for the quarter. As per Vale's First Quarter
2021 Performance Report, physical completion of the Salobo III mine
expansion was 73% at the end of the first quarter and is on track
for start-up in the first half of 2022.
Peñasquito: In the first quarter of 2021, Peñasquito produced
2.2 million ounces of attributable silver, a decrease of
approximately 17% relative to the first quarter of 2020 primarily
due to the mining of lower grade material as per the mine plan.
Antamina: In the first quarter of 2021, Antamina produced 1.6
million ounces of attributable silver, an increase of approximately
20% relative to the first quarter of 2020, due to higher grades,
recovery and throughput .
San Dimas: In the first quarter of 2021, San Dimas produced
10,500 ounces of attributable gold, a decrease of approximately 7%
relative to the first quarter of 2020 due primarily to lower
grades. As per First Majestic's First Quarter 2021 Production
Report, increased ore development activities resulted in lower
average ore grades processed in the plant.
Constancia: In the first quarter of 2021, Constancia produced
0.4 million ounces of attributable silver and 2,500 ounces of
attributable gold, a decrease of approximately 12% and 33%,
respectively, relative to the first quarter of 2020, with the
reduction in gold production being primarily due to inclusion of
2,005 ounces received in the first quarter of 2020 as a delay
payment relative to Pampacancha. Hudbay Minerals Inc. ("Hudbay")
announced on April 7, 2021, that the final land user agreement for
Pampacancha has been completed and Hudbay now has full access to
the site and has begun pit development activities. As per Hudbay's
MD&A for the year ended December 31, 2020, Hudbay no longer
expects to mine four million tonnes of ore from the Pampacancha
deposit by June 30, 2021, and should they fail to meet this
milestone, they will be required to deliver an additional 8,020
ounces of gold to the Company in four equal quarterly installments,
commencing September 30, 2021. Hudbay and the Company are currently
in discussions about, among other things, alternatives to defer the
additional gold deliveries over the Pampacancha mine life.
Sudbury: In the first quarter of 2021, Vale's Sudbury mines
produced 6,200 ounces of attributable gold, a decrease of
approximately 20% relative to the first quarter of 2020, due
primarily to lower throughput .
Other Silver: In the first quarter of 2021, total Other Silver
attributable production was 2.6 million ounces, an increase of
approximately 13% relative to the first quarter of 2020 primarily
due to the initial production from the Cozamin mine. As per the
precious metals purchase agreement ("PMPA") with Capstone Mining
Corp. ("Capstone"), Wheaton is entitled to any silver sold from the
Cozamin mine to an offtaker as of December 1, 2020, resulting in
reported production in the first quarter of 2021 including some
material processed in the previous quarter.
Voisey's Bay: In the first quarter of 2021, the Voisey's Bay
mine produced 1,161,000 pounds of attributable cobalt. As at the
end of the first quarter 2021, approximately 132,000 pounds of
cobalt were held in inventory by Wheaton and 818,600 pounds were
produced but not delivered. As per the PMPA with Vale, Wheaton is
entitled to any cobalt processed at the Long Harbour Processing
Plant as of January 1, 2021, resulting in reported production in
the first quarter of 2021 including some material produced at the
Voisey's Bay mine in the previous quarter. As per Vale's First
Quarter 2021 Performance Report, physical completion of the
Voisey's Bay underground mine extension was 62% at the end of the
first quarter and is on track for start-up in the first half of
2021, with full completion scheduled for 2023.
Rosemont: Hudbay announced on March 29, 2021, the intersection
of high-grade copper sulphide and oxide mineralization at shallow
depth on its wholly-owned patented mining claims located within
seven kilometers of its Rosemont copper project in Arizona. As a
result of the discovery, Hudbay has initiated a second phase of
exploration drilling in 2021 with a 70,000 foot follow-up drill
program and has doubled the number of drill rigs operating at site
to six. The discovery is included in Wheaton's area of interest
under the PMPA.
Produced But Not Yet Delivered [3]
As at March 31, 2021 , payable ounces and pounds attributable to
the Company produced but not yet delivered amounted to:
-- 69,300 payable gold ounces, a decrease of 1,300 ounces during
Q1 2021 , primarily due to a reduction during the period relative
to the Salobo mine partially offset by increases at the 777 and
Sudbury mines.
-- 3.7 million payable silver ounces, a decrease of 0.8 million
ounces during Q1 2021 , primarily due to reductions during the
period relative to the Antamina, Yauliyacu and Peñasquito
mines.
-- 5,400 payable palladium ounces, a decrease of 200 ounces during Q1 2021 .
-- 818,600 payable cobalt pounds.
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.
Corporate Development
Santo Domingo Mine: On March 25, 2021, the Company announced
that it had entered into a PMPA with Capstone in respect to the
Santo Domingo project located in the Atacama Region, Chile. The
Company will purchase 100% of the payable gold production until
285,000 ounces have been delivered, thereafter dropping to 67% of
payable gold production for the life of the mine. The Company will
pay Capstone a total upfront cash consideration of $290 million,
$30 million of which was paid on April 21, 2021, and the remainder
of which is payable during construction of the Santo Domingo
project, subject to customary conditions being satisfied, including
Capstone attaining sufficient financing to cover total expected
capital expenditures. In addition, Wheaton will make ongoing
payments for gold ounces delivered equal to 18% of the spot gold
price until the market value of gold delivered to the Company, net
of the per ounce cash payment, exceeds the initial upfront cash
deposit, and 22% of the spot gold price thereafter.
Other Corporate Development Updates:
-- On February 19, 2021, the previously announced PMPA relative
to the Cozamin mine was closed, with the upfront cash consideration
of $150 million being paid to Capstone on that date.
-- On April 15, 2021, the previously announced PMPA relative to
the Marmato mine was closed, with the initial upfront cash
consideration of $34 million being paid to Aris Gold Corporation
("Aris") on that date.
-- On January 5, 2021, the Company acquired a 2.0% net smelter
return royalty interest relative to the Brewery Creek mine located
in the Yukon Territories, Canada.
COVID-19 Community Support and Response Fund
In the second quarter of 2020, Wheaton announced the launch of a
$5 million Community Support and Response Fund (the "CSR Fund") to
support global efforts to combat the COVID-19 pandemic and its
impacts on our communities. The CSR Fund is designed to meet the
immediate needs of the communities in which Wheaton and its mining
partners operate. This fund is incremental to Wheaton's already
active Community Investment Program that currently provides support
to over 50 programs in multiple communities around the world. As of
March 31, 2021, the Company has made donations totalling
approximately $3 million with the CSR Fund.
Webcast and Conference Call Details
A conference call and webcast will be held on Friday, May 7,
2021 starting at 11:00 am (Eastern Time) to discuss these results.
To participate in the live call please use one of the following
methods:
Dial toll free from Canada or the US: 1-888-231-8191
Dial from outside Canada or the US: 1-647-427-7450
Pass code: 3449069
Live audio webcast: Webcast URL
Participants should dial in five to ten minutes before the
call.
The accompanying slideshow will also be available in PDF format
on the 'Events' page of the Wheaton Precious Metals website before
the conference call.
The conference call will be recorded and available until May 14,
2021 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: 1-855-859-2056
Dial from outside Canada or the US: 1-416-849-0833
Pass code: 3449069
Archived audio webcast: Webcast URL
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.sedar.com.
Mr. Wes Carson, P.Eng., Vice President, Mining Operations, is a
"qualified person" as such term is defined under National
Instrument 43-101, and has reviewed and approved the technical
information disclosed in this news release.
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
.
About Wheaton Precious Metals Corp. and Outlook
Wheaton is the world's premier precious metals streaming company
with the highest-quality portfolio of long-life, low-cost assets.
Its business model offers investors commodity price leverage and
exploration upside but with a much lower risk profile than a
traditional mining company. Wheaton delivers amongst the highest
cash operating margins in the mining industry, allowing it to pay a
competitive dividend and continue to grow through accretive
acquisitions. As a result, Wheaton has consistently outperformed
gold and silver, as well as other mining investments. Wheaton
creates sustainable value through streaming.
Wheaton's estimated attributable production in 2021 is forecast
to be 370,000 to 400,000 ounces of gold, 22.5 to 24.0 million
ounces of silver, and 40,000 to 45,000 gold equivalent ounces (2)
("GEOs") of other metals, resulting in production of approximately
720,000 to 780,000 GEOs (2) , unchanged from previous guidance. For
the five-year period ending in 2025, the Company estimates that
average production will amount to 810,000 GEOs [4] . For the
ten-year period ending in 2030, the Company estimates that average
annual production will amount to 830,000 GEOs (4) .
In accordance with Wheaton Precious Metals(TM) Corp.'s ("Wheaton
Precious Metals", "Wheaton" or the "Company") MD&A and
financial statements, reference to the Company includes the
Company's wholly owned subsidiaries.
Condensed Interim Consolidated Statements of Earnings
Three Months Ended
March 31
(US dollars and shares in thousands, except per share amounts - unaudited) 2021 2020
---------------------------------------------------------------------------- ------------- ------------
Sales $ 324,119 $ 254,789
----------------------------------------------------------------------------- -------- --------
Cost of sales
Cost of sales, excluding depletion $ 78,783 $ 66,908
Depletion 70,173 64,841
---------------------------------------------------------------------------------- -------- --------
Total cost of sales $ 148,956 $ 131,749
----------------------------------------------------------------------------- -------- --------
Gross margin $ 175,163 $ 123,040
General and administrative expenses 11,971 13,181
---------------------------------------------------------------------------------- -------- --------
Earnings from operations $ 163,192 $ 109,859
Other (income) expense 119 (597)
---------------------------------------------------------------------------------- -------- --------
Earnings before finance costs and income taxes $ 163,073 $ 110,456
Finance costs 1,573 7,118
---------------------------------------------------------------------------------- -------- --------
Earnings before income taxes $ 161,500 $ 103,338
Income tax recovery (expense) 502 (8,442)
---------------------------------------------------------------------------------- -------- --------
Net earnings $ 162,002 $ 94,896
----------------------------------------------------------------------------- -------- --------
Basic earnings per share $ 0.360 $ 0.212
Diluted earnings per share $ 0.360 $ 0.211
Weighted average number of shares outstanding
Basic 449,509 447,805
Diluted 450,600 448,891
================================================================================== ======== ========
Condensed Interim Consolidated Balance Sheets
As at
As at December
March 31 31
(US dollars in thousands - unaudited) 2021 2020
------------------------------------------------- --------------- --------------
Assets
Current assets
Cash and cash equivalents $ 191,162 $ 192,683
Accounts receivable 6,094 5,883
Other 4,228 3,265
------------------------------------------------------ ---------- ----------
Total current assets $ 201,484 $ 201,831
------------------------------------------------- --- ---------- ----------
Non-current assets
Mineral stream interests $ 5,568,364 $ 5,488,391
Early deposit mineral stream interests 33,991 33,241
Mineral royalty interest 6,606 3,047
Long-term equity investments 86,522 199,878
Convertible notes receivable 12,591 11,353
Property, plant and equipment 5,991 6,289
Other 12,863 13,242
------------------------------------------------------ ---------- ----------
Total non-current assets $ 5,726,928 $ 5,755,441
------------------------------------------------- --- ---------- ----------
Total assets $ 5,928,412 $ 5,957,272
------------------------------------------------- --- ---------- ----------
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 10,394 $ 13,023
Dividends payable 58,478 -
Current portion of performance share units 26,428 17,297
Current portion of lease liabilities 789 773
Other 883 76
Total current liabilities $ 96,972 $ 31,169
------------------------------------------------- --- ---------- ----------
Non-current liabilities
Bank debt $ - $ 195,000
Lease liabilities 2,687 2,864
Deferred income taxes 235 214
Performance share units 3,250 11,784
Pension liability 1,841 1,670
------------------------------------------------------ ---------- ----------
Total non-current liabilities $ 8,013 $ 211,532
------------------------------------------------- --- ---------- ----------
Total liabilities $ 104,985 $ 242,701
------------------------------------------------- --- ---------- ----------
Shareholders' equity
Issued capital $ 3,656,400 $ 3,646,291
Reserves 68,986 126,882
Retained earnings 2,098,041 1,941,398
------------------------------------------------------ ---------- ----------
Total shareholders' equity $ 5,823,427 $ 5,714,571
------------------------------------------------- --- ---------- ----------
Total liabilities and shareholders' equity $ 5,928,412 $ 5,957,272
------------------------------------------------- --- ---------- ----------
Condensed Interim Consolidated Statements of Cash Flows
Three Months Ended
March 31
(US dollars in thousands - unaudited) 2021 2020
--------------------------------------------------------------------------- --------------- --------------
Operating activities
Net earnings $ 162,002 $ 94,896
Adjustments for
Depreciation and depletion 70,649 65,352
Interest expense 262 5,978
Equity settled stock based compensation 1,325 1,503
Performance share units 305 3,277
Pension expense 151 35
Income tax expense (recovery) (502) 8,442
Loss (gain) on fair value adjustment of share purchase warrants held 950 71
Fair value (gain) loss on convertible note receivable (1,238) 790
Investment income recognized in net earnings (2) (117)
Other 593 (317)
Change in non-cash working capital (1,972) 4,620
================================================================================= ========== ==========
Cash generated from operations before income taxes and interest $ 232,523 $ 184,530
Income taxes recovered (paid) (30) 89
Interest paid (341) (7,148)
Interest received 2 117
================================================================================= ========== ==========
Cash generated from operating activities $ 232,154 $ 177,588
============================================================================ ========== ==========
Financing activities
Bank debt repaid $ (195,000) $ (159,000)
Credit facility extension fees - (1,360)
Share purchase options exercised 4,793 6,922
Lease payments (214) (167)
--------------------------------------------------------------------------------- ---------- ----------
Cash (used for) generated from financing activities $ (190,421) $ (153,605)
============================================================================ ========== ==========
Investing activities
Mineral stream interests $ (151,019) $ -
Early deposit mineral stream interests (750) (750)
Mineral royalty interest (3,561) -
Proceeds on disposal of long-term investments 112,188 -
Other (134) (257)
================================================================================= ========== ==========
Cash generated from (used for) investing activities $ (43,276) $ (1,007)
============================================================================ ========== ==========
Effect of exchange rate changes on cash and cash equivalents $ 22 $ (286)
============================================================================ ========== ==========
(Decrease) increase in cash and cash equivalents $ (1,521) $ 22,690
Cash and cash equivalents, beginning of period 192,683 103,986
================================================================================= ========== ==========
Cash and cash equivalents, end of period $ 191,162 $ 126,676
---------------------------------------------------------------------------- ---------- ----------
Summary of Units Produced
Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Q2 2019
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Gold ounces
produced (2)
Salobo 46,622 62,854 63,408 59,104 62,575 74,716 73,615 67,056
Sudbury (3) 6,208 6,659 3,798 9,257 7,795 6,468 6,082 9,360
Constancia (8) 2,453 3,929 3,780 3,470 3,681 4,757 5,172 4,533
San Dimas (4, 8) 10,491 11,652 9,228 6,074 11,318 11,352 11,239 11,496
Stillwater (5) 3,041 3,290 3,176 3,222 2,955 3,585 3,238 3,675
Other
Minto (6) 2,638 789 1,832 2,928 2,124 2,189 - -
777 (9) 6,280 2,866 5,278 4,728 4,551 3,987 4,278 4,788
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total Other 8,918 3,655 7,110 7,656 6,675 6,176 4,278 4,788
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total gold ounces
produced 77,733 92,039 90,500 88,783 94,999 107,054 103,624 100,908
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Silver ounces
produced (2)
Peñasquito
(8) 2,202 2,014 1,992 967 2,658 1,895 2,026 702
Antamina (8) 1,577 1,930 1,516 612 1,311 1,342 1,223 1,334
Constancia (8) 406 478 430 254 461 632 686 552
Other
Los Filos
(8) 23 6 17 14 29 55 33 37
Zinkgruvan 420 515 498 389 662 670 587 590
Yauliyacu
(8) 737 454 679 273 557 358 620 627
Stratoni 165 185 156 148 183 147 131 172
Minto (6) 21 16 15 19 18 18 - -
Neves-Corvo 345 420 281 479 377 385 431 392
Aljustrel 474 440 348 388 352 325 240 322
Cozamin 230 - - - - - - -
Keno Hill 24 - - - - - - -
777 (9) 130 51 96 108 96 81 62 93
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total Other 2,569 2,087 2,090 1,818 2,274 2,039 2,104 2,233
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total silver
ounces produced 6,754 6,509 6,028 3,651 6,704 5,908 6,039 4,821
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Palladium ounces
produced (2)
Stillwater (5) 5,769 5,672 5,444 5,759 5,312 6,057 5,471 5,736
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Cobalt pounds
produced (2)
Voisey's Bay 1,160,921 - - - - - - -
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
GEOs produced (7) 190,359 189,682 181,184 146,857 194,901 196,850 194,499 175,185
SEOs produced (7) 13,706 13,657 13,045 10,574 14,033 14,173 14,004 12,613
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Average payable
rate (2)
Gold 95.0% 95.2% 95.3% 94.7% 95.1% 95.6% 95.1% 95.3%
Silver 86.6% 86.3% 86.1% 81.9% 85.6% 85.3% 85.1% 83.3%
Palladium 85.1% 98.2% 97.0% 86.5% 93.0% 99.4% 83.5% 87.6%
Cobalt 93.3% n.a. n.a. n.a. n.a. n.a. n.a. n.a.
GEO (7) 90.4% 91.1% 91.1% 89.8% 90.4% 91.5% 90.4% 90.4%
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
1) All figures in thousands except cobalt pounds and 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 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) 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. Effective April 1, 2020, the fixed gold to silver
exchange ratio was revised to 90:1, with the 70:1 ratio being
reinstated on October 15, 2020. For reference, attributable silver
production from prior periods is as follows: Q1-2021 - 437,000
ounces; Q4-2020 - 476,000 ounces; Q3-2020 - 420,000 ounces; Q2-2020
- 276,000 ounces; Q1-2020 - 419,000 ounces; Q4-2019 - 415,000
ounces; Q3-2019 - 410,000 ounces; and Q2-2019 - 401,000 ounces.
5) Comprised of the Stillwater and East Boulder gold and palladium interests.
6) The Minto mine was placed into care and maintenance from October 2018 to October 2019.
7) GEOs and SEOs, which are provided to assist the reader, are
based on the following commodity price assumptions: $1,800 per
ounce gold; $25.00 per ounce silver; $2,300 per ounce palladium;
and $17.75 per pound cobalt; consistent with those used in
estimating the Company's production guidance for 2021.
8) Operations at these mines had been temporarily suspended
during the second quarter of 2020 as a result of the COVID-19
pandemic. During the second half of 2020, all of the operations
were restarted. Additionally, operations at Los Filos were
suspended from September 3, 2020 to December 23, 2020 as the result
of an illegal road blockade by members of the nearby Carrizalillo
community.
9) Operations at 777 were temporarily suspended from October 11,
2020 to November 25, 2020 as a result of an incident that occurred
on October 9th during routine maintenance of the hoist rope and
skip.
Summary of Units Sold
Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Q2 2019
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Gold ounces sold
Salobo 51,423 53,197 59,584 68,487 74,944 58,137 63,064 57,715
Sudbury (2) 3,691 7,620 7,858 7,414 4,822 7,394 7,600 8,309
Constancia (7) 1,676 3,853 4,112 3,024 3,331 5,108 4,742 4,409
San Dimas (7) 10,273 11,529 9,687 6,030 11,358 11,499 11,374 10,284
Stillwater (3) 3,074 3,069 3,015 3,066 3,510 2,925 3,314 3,301
Other
Minto (4) 2,390 1,540 - - - - - 765
777 2,577 5,435 5,845 4,783 2,440 4,160 4,672 5,294
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total Other 4,967 6,975 5,845 4,783 2,440 4,160 4,672 6,059
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total gold ounces
sold 75,104 86,243 90,101 92,804 100,405 89,223 94,766 90,077
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Silver ounces sold
Peñasquito
(7) 2,174 1,417 1,799 1,917 2,310 1,268 1,233 912
Antamina (7) 1,930 1,669 1,090 788 1,244 1,227 1,059 1,186
Constancia (7) 346 442 415 254 350 672 521 478
Other
Los Filos
(7) 27 - 19 25 37 26 44 26
Zinkgruvan 293 326 492 376 447 473 459 337
Yauliyacu
(7) 1,014 15 580 704 9 561 574 542
Stratoni 117 169 134 77 163 120 126 240
Minto (4) 26 20 - - - - - 2
Neves-Corvo 239 145 201 236 204 154 243 194
Aljustrel 257 280 148 252 123 121 139 216
Cozamin 173 - - - - - - -
Keno Hill 12 - - - - - - -
777 49 93 121 100 41 62 86 108
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total Other 2,207 1,048 1,695 1,770 1,024 1,517 1,671 1,665
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Total silver
ounces sold 6,657 4,576 4,999 4,729 4,928 4,684 4,484 4,241
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Palladium ounces
sold
Stillwater (3) 5,131 4,591 5,546 4,976 4,938 5,312 4,907 5,273
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Cobalt pounds sold
Voisey's Bay 132,277 - - - - - - -
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
GEOs sold (5) 175,419 155,665 166,611 164,844 175,154 161,066 163,314 155,723
SEOs sold (5) 12,630 11,208 11,996 11,869 12,611 11,597 11,759 11,212
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Cumulative payable
units PBND (6)
Gold ounces 69,262 70,555 75,750 79,632 88,383 98,475 85,335 81,535
Silver ounces 3,717 4,486 3,437 3,222 4,961 4,142 3,796 3,102
Palladium ounces 5,373 5,597 4,616 4,883 4,875 4,872 4,163 4,504
Cobalt pounds 818,584 - - - - - - -
GEO (5) 135,828 140,008 129,391 130,623 163,521 162,225 143,380 130,374
SEO (5) 9,198 10,081 9,316 9,405 11,774 11,680 10,323 9,387
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
Inventory on hand
Cobalt pounds 132,277 - - - - - - -
------------------ ------------------- ----------------- ------------------ ------------------ ----------------- ----------------- ----------------- -----------------
1) All figures in thousands except cobalt pounds and 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) The Minto mine was placed into care and maintenance from October 2018 to October 2019.
5) GEOs and SEOs, which are provided to assist the reader, are
based on the following commodity price assumptions: $1,800 per
ounce gold; $25.00 per ounce silver; $2,300 per ounce palladium;
and $17.75 per pound cobalt; consistent with those used in
estimating the Company's production guidance for 2021.
6) Payable gold, silver and palladium ounces as well as cobalt
pounds produced but not yet delivered ("PBND") are based on
management estimates. These figures may be updated in future
periods as additional information is received.
7) Operations at these mines had been temporarily suspended
during the second quarter of 2020 as a result of the COVID-19
pandemic. During the second half of 2020, all of the operations
were restarted.
Results of Operations
The operating results of the Company's reportable operating
segments are summarized in the tables and commentary below.
Three Months Ended March 31, 2021
-----------------------------------------------------------------------------------------------------------------------------
Average Average Average
Realized Cash Cost Depletion Cash Flow
Units Units Price ($'s Per ($'s Per Net From Total
Produced(2) Sold ($'s Per Unit) Unit)(3) Unit) Sales Earnings Operations Assets
------------------ ----------- ------- ---------------- --------- --------- -------- --------- ---------- ----------
Gold
Salobo 46,622 51,423 $ 1,796 $ 412 $ 374 $ 92,356 $ 51,946 $ 71,163 $2,490,127
Sudbury (4) 6,208 3,691 1,812 400 1,024 6,688 1,431 5,219 317,235
Constancia 2,453 1,676 1,796 408 315 3,010 1,798 2,326 105,041
San Dimas 10,491 10,273 1,796 612 322 18,450 8,851 12,162 178,891
Stillwater 3,041 3,074 1,796 329 397 5,521 3,290 4,510 223,090
Other (5) 8,918 4,967 1,812 629 - 9,000 5,878 5,855 7,591
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
77,733 75,104 $ 1,798 $ 450 $ 374 $135,025 $ 73,194 $ 101,235 $3,321,975
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Silver
Peñasquito 2,202 2,174 $ 26.21 $ 4.29 $ 3.55 $ 56,983 $ 39,940 $ 47,655 $ 342,857
Antamina 1,577 1,930 26.21 5.18 7.53 50,581 26,058 40,591 612,401
Constancia 406 346 26.21 6.02 7.56 9,072 4,372 6,988 214,428
Other (6) 2,569 2,207 25.95 9.41 6.30 57,247 22,589 39,098 612,237
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
6,754 6,657 $ 26.12 $ 6.33 $ 5.82 $173,883 $ 92,959 $ 134,332 $1,781,923
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Palladium
Stillwater 5,769 5,131 $ 2,392 $ 427 $ 442 $ 12,275 $ 7,813 $ 10,084 $ 239,118
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Cobalt
Voisey's Bay 1,160,921 132,277 $ 22.19 $ 4.98 $ 8.17 $ 2,936 $ 1,197 $ (966) $ 225,348
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Operating results $324,119 $ 175,163 $ 244,685 $5,568,364
------------------------------- ------- ------------ -------- -------- ------- -------- --------- ---------
Other
General and administrative $(11,971) $ (13,592)
Finance costs (1,573) (1,229)
Other (119) 2,320
Income tax 502 (30)
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Total other $(13,161) $ (12,531) $ 360,048
---------------------------------------- ------------ -------- -------- ------- -------- --------- ---------
$ 162,002 $ 232,154 $5,928,412
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
1) Units produced and sold relative to gold, silver and
palladium are reported in ounces, while cobalt is reported in
pounds. All figures in thousands except cobalt pounds produced and
sold, gold and palladium ounces produced and sold and per unit
amounts.
2) Quantity produced represent the amount of gold, silver,
palladium and cobalt contained in concentrate or doré prior to
smelting or refining deductions. Production figures are based on
information provided by the operators of the mining operations to
which the mineral stream interests relate or management estimates
in those situations where other information is not available.
Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press release.
4) Comprised of the operating Coleman, Copper Cliff, Garson,
Creighton and Totten gold interests and the non-operating Stobie
and Victor gold interests.
5) Comprised of the operating 777, Minto and Marmato gold
interests, the non-operating Rosemont gold interest and the newly
acquired Santo Domingo gold interest.
6) Comprised of the operating Los Filos, Zinkgruvan, Yauliyacu,
Stratoni, Neves-Corvo, Aljustrel, Minto, Keno Hill, Cozamin,
Marmato and 777 silver interests and the non-operating Loma de La
Plata, Pascua-Lama and Rosemont silver interests.
On a gold equivalent and silver equivalent basis, results for
the Company for the three months ended March 31, 2021 were as
follows:
Three Months Ended March 31, 2021
----------------------------------------------------------------------------------------------------------------------
Average
Realized Average Cash Operating Average Gross
Price Cash Cost Margin Depletion Margin
Ounces Ounces ($'s Per ($'s Per ($'s Per Ounce) ($'s Per ($'s Per
Produced (1, 2) Sold (2) Ounce) Ounce) (3) (4) Ounce) Ounce)
----------------- ----------------- ---------- ---------- ------------ ----------------- ----------- ----------
Gold equivalent
basis (5) 190,359 175,419 $ 1,848 $ 449 $ 1,399 $ 400 $ 999
Silver
equivalent
basis (5) 13,706 12,630 $ 25.66 $ 6.24 $ 19.42 $ 5.56 $ 13.86
----------------- ----------------- ---------- ---------- ------------ ----------------- ----------- ----------
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) Silver ounces produced and sold in thousands.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press release.
4) Refer to discussion on non-IFRS measure (iv) at the end of this press release.
5) GEOs and SEOs, which are provided to assist the reader, are
based on the following commodity price assumptions: $1,800 per
ounce gold; $25.00 per ounce silver; $2,300 per ounce palladium;
and $17.75 per pound cobalt; consistent with those used in
estimating the Company's production guidance for 2021.
Three Months Ended March 31, 2020
-----------------------------------------------------------------------------------------------------------------------------
Average Average Average
Realized Cash Cost Depletion Cash Flow
Units Units Price ($'s Per ($'s Per Net From Total
Produced(2) Sold ($'s Per Unit) Unit)(3) Unit) Sales Earnings Operations Assets
------------------ ----------- ------- ---------------- --------- --------- -------- --------- ---------- ----------
Gold
Salobo 62,575 74,944 $ 1,589 $ 408 $ 374 $119,094 $ 60,459 $ 89,137 $2,577,202
Sudbury (4) 7,795 4,822 1,585 400 828 7,641 1,719 5,616 340,050
Constancia 3,681 3,331 1,589 404 338 5,294 2,823 3,948 109,281
San Dimas 11,318 11,358 1,589 606 315 18,049 7,587 11,166 190,787
Stillwater 2,955 3,510 1,589 284 449 5,578 3,006 4,582 228,418
Other (5) 6,675 2,440 1,585 420 305 3,866 2,096 2,840 12,424
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
94,999 100,405 $ 1,589 $ 426 $ 389 $159,522 $ 77,690 $ 117,289 $3,458,162
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Silver
Peñasquito 2,658 2,310 $ 17.41 $ 4.26 $ 3.24 $ 40,223 $ 22,893 $ 30,383 $ 367,212
Antamina 1,311 1,244 17.41 3.43 8.74 21,661 6,524 17,397 657,937
Constancia 461 350 17.41 5.96 7.63 6,088 1,337 4,004 225,520
Other (6) 2,274 1,024 15.57 5.83 2.56 15,945 7,345 14,126 485,068
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
6,704 4,928 $ 17.03 $ 4.50 $ 4.80 $ 83,917 $ 38,099 $ 65,910 $1,735,737
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Palladium
Stillwater 5,312 4,938 $ 2,298 $ 402 $ 428 $ 11,350 $ 7,251 $ 9,364 $ 247,856
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Cobalt
Voisey's Bay - - $ n.a. $ n.a. $ n.a. $ - $ - $ - $ 227,510
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Operating results $254,789 $ 123,040 $ 192,563 $5,669,265
------------------------------- ------- ------------ -------- -------- ------- -------- --------- ---------
Other
General and administrative $(13,181) $ (10,732)
Finance costs (7,118) (8,110)
Other 597 3,778
Income tax (8,442) 89
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
Total other $(28,144) $ (14,975) $ 407,676
---------------------------------------- ------------ -------- -------- ------- -------- --------- ---------
$ 94,896 $ 177,588 $6,076,941
------------------ ----------- ------- ------------ -------- -------- ------- -------- --------- ---------
1) Units produced and sold relative to gold, silver and
palladium are reported in ounces, while cobalt is reported in
pounds. All figures in thousands except cobalt pounds produced and
sold, gold and palladium ounces produced and sold and per unit
amounts.
2) Quantity produced represent the amount of gold, silver,
palladium and cobalt contained in concentrate or doré prior to
smelting or refining deductions. Production figures are based on
information provided by the operators of the mining operations to
which the mineral stream interests relate or management estimates
in those situations where other information is not available.
Certain production figures may be updated in future periods as
additional information is received.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press release.
4) Comprised of the operating Coleman, Copper Cliff, Garson,
Creighton and Totten gold interests as well as the non-operating
Stobie and Victor gold interests.
5) Comprised of the operating Minto and 777 gold interests in
addition to the non-operating Rosemont gold interest.
6) Comprised of the operating Los Filos, Zinkgruvan, Yauliyacu,
Stratoni, Neves-Corvo, Aljustrel, Minto and 777 silver interests as
well as the non-operating Keno Hill, Loma de La Plata, Pascua-Lama
and Rosemont silver interests.
On a gold equivalent and silver equivalent basis, results for
the Company for the three months ended March 31, 2020 were as
follows:
Three Months Ended March 31, 2020
----------------------------------------------------------------------------------------------------------------------
Average
Realized Average Cash Operating Average Gross
Price Cash Cost Margin Depletion Margin
Ounces Ounces ($'s Per ($'s Per ($'s Per Ounce) ($'s Per ($'s Per
Produced (1, 2) Sold (2) Ounce) Ounce) (3) (4) Ounce) Ounce)
----------------- ----------------- ---------- ---------- ------------ ----------------- ----------- ----------
Gold equivalent
basis (5) 194,901 175,154 $ 1,455 $ 382 $ 1,073 $ 370 $ 703
Silver
equivalent
basis (5) 14,033 12,611 $ 20.20 $ 5.31 $ 14.89 $ 5.14 $ 9.75
----------------- ----------------- ---------- ---------- ------------ ----------------- ----------- ----------
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) Silver ounces produced and sold in thousands.
3) Refer to discussion on non-IFRS measure (iii) at the end of this press release.
4) Refer to discussion on non-IFRS measure (iv) at the end of this press release.
5) GEOs and SEOs, which are provided to assist the reader, are
based on the following commodity price assumptions: $1,800 per
ounce gold; $25.00 per ounce silver; $2,300 per ounce palladium;
and $17.75 per pound cobalt; consistent with those used in
estimating the Company's production guidance for 2021.
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,
with the Company receiving its first deliveries of cobalt relative
to its Voisey's Bay PMPA during the first quarter of 2021; and (iv)
cash operating margin. The Company has removed the non-IFRS measure
relative to net debt as Wheaton fully repaid its debt during the
first quarter of 2021.
i. Adjusted net earnings and adjusted net earnings per share are
calculated by removing the effects of non-cash impairment charges,
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) 2021 2020
------------------------------------------------------------------------------------ ------------- ------------
Net earnings $ 162,002 $ 94,896
Add back (deduct):
(Gain) loss on fair value adjustment of share purchase warrants held 950 71
(Gain) loss on fair value adjustment of convertible notes receivable (1,238) 790
Income tax expense (recovery) recognized in the Statement of Shareholders' Equity 1,568 (1,480)
Income tax expense (recovery) recognized in the Statement of OCI (2,137) 9,853
Other (13) 403
------------------------------------------------------------------------------------------ -------- --------
Adjusted net earnings $ 161,132 $ 104,533
------------------------------------------------------------------------------------- -------- --------
Divided by:
Basic weighted average number of shares outstanding 449,509 447,805
Diluted weighted average number of shares outstanding 450,600 448,891
------------------------------------------------------------------------------------------ -------- --------
Equals:
Adjusted earnings per share - basic $ 0.358 $ 0.233
Adjusted earnings per share - diluted $ 0.358 $ 0.233
------------------------------------------------------------------------------------- -------- --------
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) 2021 2020
--------------------------------------------------------- ------------- ------------
Cash generated by operating activities $ 232,154 $ 177,588
---------------------------------------------------------- -------- --------
Divided by:
Basic weighted average number of shares outstanding 449,509 447,805
Diluted weighted average number of shares outstanding 450,600 448,891
--------------------------------------------------------------- -------- --------
Equals:
Operating cash flow per share - basic $ 0.516 $ 0.397
Operating cash flow per share - diluted $ 0.515 $ 0.396
---------------------------------------------------------- -------- --------
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 and cobalt pounds sold and
per unit amounts) 2021 2020
---------------------------------------------------------------------------------- -------------- -------------
Cost of sales $ 148,956 $ 131,749
Less: depletion (70,173) (64,841)
---------------------------------------------------------------------------------------- --------- ---------
Cash cost of sales $ 78,783 $ 66,908
----------------------------------------------------------------------------------- --------- ---------
Cash cost of sales is comprised of:
Total cash cost of gold sold $ 33,774 $ 42,759
Total cash cost of silver sold 42,160 22,163
Total cash cost of palladium sold 2,191 1,986
Total cash cost of cobalt sold 658 -
---------------------------------------------------------------------------------- --- --------- ---------
Total cash cost of sales $ 78,783 $ 66,908
----------------------------------------------------------------------------------- --------- ---------
Divided by:
Total gold ounces sold 75,104 100,405
Total silver ounces sold 6,657 4,928
Total palladium ounces sold 5,131 4,938
Total cobalt pounds sold 132,277 -
---------------------------------------------------------------------------------- --- --------- ---------
Equals:
Average cash cost of gold (per ounce) $ 450 $ 426
Average cash cost of silver (per ounce) $ 6.33 $ 4.50
Average cash cost of palladium (per ounce) $ 427 $ 402
Average cash cost of cobalt (per pound) $ 4.98 $ n.a.
----------------------------------------------------------------------------------- --------- ---------
iv. Cash operating margin is calculated by subtracting the
average cash cost of gold, silver and palladium on a per ounce
basis and cobalt on a per pound basis from the average realized
selling price of gold, silver and palladium on a per ounce basis
and cobalt on a per pound basis. 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 cobalt pounds, gold and palladium ounces sold and per
unit amounts) 2021 2020
==================================================================================== ============= ============
Total sales:
Gold $ 135,025 $ 159,522
Silver $ 173,883 $ 83,917
Palladium $ 12,275 $ 11,350
Cobalt $ 2,936 $ -
Divided by:
Total gold ounces sold 75,104 100,405
Total silver ounces sold 6,657 4,928
Total palladium ounces sold 5,131 4,938
Total cobalt pounds sold 132,277 -
------------------------------------------------------------------------------------ --- -------- --------
Equals:
Average realized price of gold (per ounce) $ 1,798 $ 1,589
Average realized price of silver (per ounce) $ 26.12 $ 17.03
Average realized price of palladium (per ounce) $ 2,392 $ 2,298
Average realized price of cobalt (per pound) $ 22.19 $ n.a.
Less:
Average cash cost of gold (1) (per ounce) $ (450) $ (426)
Average cash cost of silver (1) (per ounce) $ (6.33) $ (4.50)
Average cash cost of palladium (1) (per ounce) $ (427) $ (402)
Average cash cost of cobalt (1) (per pound) $ (4.98) $ n.a.
------------------------------------------------------------------------------------ --- -------- --------
Equals:
Cash operating margin per gold ounce sold $ 1,348 $ 1,163
As a percentage of realized price of gold 75% 73%
Cash operating margin per silver ounce sold $ 19.79 $ 12.53
As a percentage of realized price of silver 76% 74%
Cash operating margin per palladium ounce sold $ 1,965 $ 1,896
As a percentage of realized price of palladium 82% 83%
Cash operating margin per cobalt pound sold $ 17.21 $ n.a.
As a percentage of realized price of cobalt 78% n.a.
------------------------------------------------------------------------------------------ -------- --------
1) Please refer to non-IFRS measure (iii), above.
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.sedar.com.
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 impact of epidemics (including the
COVID-19 virus pandemic), including the potential heightening of
other risks, the estimation of future production from Mining
Operations (including in the estimation of production, mill
throughput, grades, recoveries and exploration potential), the
estimation of mineral reserves and mineral resources (including the
estimation of reserve conversion rates) and the realization of such
estimations, the commencement, timing and achievement of
construction, expansion or improvement projects by Wheaton's PMPA
counterparties at mineral stream interests owned by Wheaton (the
"Mining Operations"), the 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, the
costs of future production, the estimation of produced but not yet
delivered ounces, the impact of the listing of the Company's common
shares on the LSE, any statements as to future dividends, the
ability to fund outstanding commitments and the ability to continue
to acquire accretive PMPAs, future payments by the Company in
accordance with PMPAs, including any acceleration of payments,
projected increases to Wheaton's production and cash flow profile,
projected changes to Wheaton's production mix, the ability of
Wheaton's PMPA counterparties to comply with the terms of any other
obligations under agreements with the Company, the ability to sell
precious metals and cobalt production, confidence in the Company's
business structure, the Company's assessment of taxes payable and
the impact of the CRA Settlement for years subsequent to 2010,
possible audits for taxation years subsequent to 2015, 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, , and assessments of the impact
and resolution of various legal and tax matters, including but not
limited to outstanding class action and 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
of significant impacts on Wheaton or the Mining Operations as a
result of an epidemic (including the COVID-19 virus pandemic),
risks related to the Mining Operations (including fluctuations in
the price of the primary or other commodities mined at such
operations, regulatory, political and other risks of the
jurisdictions in which the Mining Operations are located, actual
results of mining, risks associated with the exploration,
development, operating, expansion and improvement of the Mining
Operations, environmental and economic risks of the Mining
Operations, and changes in project parameters as plans continue to
be refined), the absence of control over the Mining Operations and
having to rely on the accuracy of the public disclosure and other
information Wheaton receives from the Mining Operations,
uncertainty in the estimation of production from Mining Operations,
uncertainty in the accuracy of mineral reserve and mineral resource
estimation, the ability of each party to satisfy their obligations
in accordance with the terms of the PMPAs, the estimation of future
production from Mining Operations, Wheaton's interpretation of,
compliance with or application of, tax laws and regulations or
accounting policies and rules being found to be incorrect, any
challenge or reassessment by the CRA of the Company's tax filings
being successful and the potential negative impact to the Company's
previous and future tax filings, assessing the impact of the CRA
Settlement for years subsequent to 2010 (including whether there
will be any material change in the Company's facts or change in law
or jurisprudence), credit and liquidity, indebtedness and
guarantees, mine operator concentration, hedging, competition,
claims and legal proceedings against Wheaton or the Mining
Operations, security over underlying assets, governmental
regulations, international operations of Wheaton and the Mining
Operations, exploration, development, operations, expansions and
improvements at the Mining Operations, environmental regulations
and climate change, Wheaton and the Mining Operations ability to
obtain and maintain necessary licenses, permits, approvals and
rulings, Wheaton and the Mining Operations ability to comply with
applicable laws, regulations and permitting requirements, lack of
suitable infrastructure and employees to support the Mining
Operations, inability to replace and expand mineral reserves,
including anticipated timing of the commencement of production by
certain Mining Operations (including increases in production,
estimated grades and recoveries), uncertainties of title and
indigenous rights with respect to the Mining Operations, Wheaton
and the Mining Operations ability to obtain adequate financing, the
Mining Operations ability to complete permitting, construction,
development and expansion, global financial conditions, 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.sedar.com , Wheaton's Form 40-F for the
year ended December 31, 2020 and Form 6-K filed March 11, 2021 both
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 neither
Wheaton nor the Mining Operations will suffer significant impacts
as a result of an epidemic (including the COVID-19 virus pandemic),
that the Mining Operations will continue to operate and the mining
projects will be completed in accordance with public statements and
achieve their stated production estimates, that the mineral
reserves and
mineral resource estimates from Mining Operations (including
reserve conversion rates) are accurate, that each party will
satisfy their obligations in accordance with the PMPAs, that
Wheaton will continue to be able to fund or obtain funding for
outstanding commitments, that Wheaton will be able to source and
obtain accretive PMPAs, that any outbreak or threat of an outbreak
of a virus or other contagions or epidemic disease will be
adequately responded to locally, nationally, regionally and
internationally, without such response requiring any prolonged
closure of the Mining Operations or having other material adverse
effects on the Company and counterparties to its PMPAs , that the
trading of the Company's common shares will not be adversely
affected by the differences in liquidity, settlement and clearing
systems as a result of multiple listings of the Common Shares on
the LSE, the TSX and the NYSE, that the trading of the Company's
common shares will not be suspended, and that the net proceeds of
sales of common shares, if any, will be used as anticipated, that
expectations regarding the resolution of legal and tax matters will
be achieved (including ongoing class action litigation and CRA
audits involving the Company), that Wheaton has properly considered
the interpretation and application of Canadian tax law to its
structure and operations, that Wheaton has filed its tax returns
and paid applicable taxes in compliance with Canadian tax law, that
Wheaton's application of the CRA Settlement for years subsequent to
2010 is accurate (including the Company's assessment that there
will be no material change in the Company's facts or change in law
or jurisprudence for years subsequent to 2010), 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.
For further information, please contact:
Patrick Drouin or Emma Murray
Investor Relations
Wheaton Precious Metals Corp.
Tel: 1-844-288-9878
Email: info@wheatonpm.com
Website: www.wheatonpm.com
[1] Please refer to non-IFRS measures at the end of this press
release. Dividends declared in the referenced calendar quarter,
relative to the financial results of the prior quarter.
[2] Commodity price assumptions for the gold equivalent
production and sales in 2021 and long-term forecasts are $1,800 /
ounce gold, $25 / ounce silver, and $2,300 / ounce palladium and
$17.75 / pound cobalt. Other metal includes palladium and
cobalt.
[3] Payable gold, silver and palladium ounces and cobalt pounds
produced but not yet delivered are based on management estimates
only and rely upon information provided by the owners and operators
of mining operations and may be revised and updated in future
periods as additional information is received.
[4] Gold equivalent guidance based on the commodity prices
outlined in note 2 above. Five- and ten-year guidance do not
include optionality production from Pascua Lama, Navidad,
Cotabambas, or additional expansions at Salobo outside of project
currently in construction. In addition, five-year guidance also
does not include any production from Rosemont, Toroparu, Kutcho, or
the Victor project at Sudbury.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
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END
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