Production Report for 6 months ended 30 June 2024

Hochschild Mining PLC
24 July 2024
 

             

_____________________________________________________________________________________

24 July 2024

 

Production Report for the 6 months ended 30 June 2024

 

Hochschild Mining PLC ("Hochschild" or "the Company") (LSE: HOC) (OTCQX: HCHDF) is pleased to announce its production report for H1 2024.

 

Eduardo Landin, Chief Executive Officer commented:

"We have delivered a robust second quarter with another good performance from Inmaculada and a first material contribution from our new Mara Rosa mine in Brazil and remain on track to meet our annual production and cost guidance. We can now look forward to a substantial increase in output in the second half which, when combined with the current strong precious metal prices, is expected to see the Company generate significant free cashflow."

 

Operational highlights

§ Q2 2024 attributable production:[1]

57,815 ounces of gold

2.1 million ounces of silver

83,034 gold equivalent ounces

6.9 million silver equivalent ounces

§ H1 2024 attributable production      

103,752 ounces of gold

4.1 million ounces of silver

152,792 gold equivalent ounces

12.7 million silver equivalent ounces

§ Reiterate 2024 guidance:

Production of 343,000-360,000 gold equivalent ounces 

All-in sustaining costs of $1,510-1,550 per gold equivalent ounce 

Project & Exploration highlights

§ Mara Rosa mine in commercial production with strong second half forecast

§ Cerrado Gold Inc. shareholders approved Hochschild's purchase of an option to acquire Monte do Carmo project

$15 million paid already for the option cost; $45 million to be paid in instalments if the option is exercised

Exploration & technical work ongoing

§ 2024 Brownfield drilling programme commenced with encouraging early results from Inmaculada and Mara Rosa

ESG highlights

§ Lost Time Injury Frequency Rate of 1.08 (FY 2023: 0.99)[2]

§ Accident Severity Index of 62 (FY 2023: 37)[3]

§ Water Consumption of 136lt/person/day (FY 2023: 163lt/person/day)

§ Domestic waste generation of 0.94 kg/person/day (FY 2023: 0.93kg/person/day)

§ ECO score of 5.85 out of 6 (FY 2023: 5.76)[4]

Financial position

§ Total cash of approximately $89 million as at 30 June 2024 ($73 million as at 31 March 2024)

§ Net debt of approximately $271 million as at 30 June 2024 ($282 million as at 31 March 2024)

§ Current Net Debt/LTM EBITDA of approximately 0.8x as at 30 June 2024

 

 

________________________________________________________________________________________

 

A conference call will be held at 2.30pm (London time) on Wednesday 24 July 2024 for analysts and investors. 

Dial in details as follows:

International Dial in: +44 330 551 0200

UK Toll-Free Number: 0808 109 0700

US Toll Free: 866-580-3963

Canada Toll Free: 866 378 3566

Password: Hochschild Mining

Please dial into the call approximately ten minutes before the 2.30pm start time.

A recording of the conference call will be available on demand on the Company's website:

________________________________________________________________________________________

 

Overview

In Q2 2024, Hochschild delivered attributable production of 83,034 gold equivalent ounces or 6.9 million silver equivalent ounces with a better-than-expected performance at Inmaculada and a solid first major contribution from the new Mara Rosa operation. In the first half of 2024, Hochschild produced 152,792 gold equivalent ounces or 12.7 million silver equivalent ounces (on an attributable basis).  The Company remains on track to meet its overall 2024 attributable production target of 343,000-360,000 gold equivalent ounces or 28.0-29.9 million silver equivalent ounces.

 

The Company reiterates that its all-in sustaining cost for 2024 is expected to be in line with the guidance of between $1,510 and $1,550 per gold equivalent ounce (or $18.2 and $18.7 per silver equivalent ounce).

 

TOTAL GROUP PRODUCTION

 

Q2 2024

Q1 2024

Q2 2023

H1 2024

H1 2023

Silver production (koz)

2,589

2,427

2,955

5,016

5,393

Gold production (koz)

66.37

53.79

54.12

120.16

100.55

Total silver equivalent (koz)

8,097

6,892

7,447

14,989

13,739

Total gold equivalent (koz)

97.56

83.03

89.72

180.59

165.53

Silver sold (koz)

2,669

2,445

3,011

5,114

5,425

Gold sold (koz)

66.06

52.18

55.29

118.33

99.79

Total production includes 100% of all production, including production attributable to Hochschild's joint venture partner at San Jose.

                                     

ATTRIBUTABLE GROUP PRODUCTION

 

Q2 2024

Q1 2024

Q2 2023

H1 2024

H1 2023

Silver production (koz)

2,093

1,977

2,386

4,070

4,442

Gold production (koz)

57.81

45.94

43.62

103.75

83.36

Silver equivalent (koz)

6,892

5,790

6,006

12,682

11,361

Gold equivalent (koz)

83.03

69.76

72.36

152.79

136.88

Attributable production includes 100% of all production from Inmaculada, Pallancata and 51% from San Jose.

 

Production

Inmaculada

Product

Q2 2024

Q1 2024

Q2 2023

H1 2024

H1 2023

Ore production (tonnes treated)

274,750

263,024

257,768

537,774

535,905

Average grade silver (g/t)

198

181

181

190

178

Average grade gold (g/t)

4.29

4.21

3.92

4.25

3.85

Silver produced (koz)

          1,578

1,509

        1,300

3,086

2,573

Gold produced (koz)

         35.62

         36.70

        30.64

72.32

61.85

Silver equivalent (koz)

4,534

4,555

3,843

9,089

7,707

Gold equivalent (koz)

54.63

54.88

46.30

109.50

92.86

Silver sold (koz)

1,645

1,387

1,357

3,032

2,561

Gold sold (koz)

37.18

34.01

32.10

71.19

61.39

 

Inmaculada's second quarter production was 35,617 ounces of gold and 1.6 million ounces of silver which amounts to a gold equivalent output of 54,626 ounces, with both tonnage and grades in the period better-than-plan due to the implementation of continuous improvement projects at site. Overall, in the first half of 2024, Inmaculada produced 109,502 gold equivalent ounces (H1 2023: 92,856 ounces), an 18% improvement on the first half of 2023 when the mine was impacted by permit delays.

 

San Jose (the Company has a 51% interest in San Jose)

Product

Q2 2024

Q1 2024

Q2 2023

H1 2024

H1 2023

Ore production (tonnes treated)

143,333

125,520

143,563

268,853

272,063

Average grade silver (g/t)

252

258

288

255

254

Average grade gold (g/t)

4.38

4.58

5.40

4.47

4.68

Silver produced (koz)

1,011

919

1,163

1,929

1,941

Gold produced (koz)

17.46

16.03

21.42

33.49

35.09

Silver equivalent (koz)

        2,460

         2,249

        2,940

4,709

4,854

Gold equivalent (koz)

        29.64

         27.09

         35.42

56.74

58.48

Silver sold (koz)

1,022

1,057

1,157

2,079

1,941

Gold sold (koz)

17.04

18.25

21.14

35.29

34.66

 

Q2 production at San Jose was 1.0 million ounces of silver and 17,463 ounces of gold which is 2.5 million silver equivalent ounces with higher-than-forecast grades offset by lower tonnage. This brings the total for the first half of the year to 4.7 million silver equivalent ounces (H1 2023: 4.9 million ounces).

 

Mara Rosa

Product

Q2 2024

Q1 2024

Q2 2023

H1 2024

H1 2023

Ore production (tonnes treated)

466,552

86,192

552,744

Average grade silver (g/t)

-

Average grade gold (g/t)

1.32

1.03

1.28

Silver produced (koz)

 

-

Gold produced (koz)

          13.29

            1.06

14.35

Silver equivalent (koz)

         1,103

              88

1,191

Gold equivalent (koz)

               13.29

            1.06

14.35

Silver sold (koz)

-

Gold sold (koz)

11.84

 -

11.84

 

The Mara Rosa mine reached commercial production in mid-May and produced 13,291 ounces of gold in the period. The processing plant has already reached nominal capacity of 7,000 tonnes per day and ongoing optimisation initiatives are currently in place with the aim of reaching a stable throughput of 8,000 tonnes per day.

 

Average realisable prices and sales

Average realisable precious metal prices in Q2 2024 (which are reported before the deduction of commercial discounts) were $2,291/ounce for gold and $30.2/ounce for silver (Q2 2023: $1,958/ounce for gold and $23.4/ounce for silver). For H1 2024, average realisable precious metal prices were $2,210/ounce for gold and $27.0/ounce for silver (H1 2023: $1,957/ounce for gold and $23.3/ounce for silver).

 

Brownfield exploration

Inmaculada

During the second quarter of the year, the team carried out a further 5,948m of drilling for potential and resources in the Tesoro, Nicolas, Andrea, and Sara vein structures.

 

Vein

Results (potential)

Tesoro

IMS24-231A: 7.1m @ 7.6g/t Au & 794g/t Ag

IMS24-221: 1.0m @ 8.8g/t Au & 27g/t Ag

IMS24-222: 38.8m @ 5.1g/t Au & 303g/t Ag

IMS24-227A: 3.1m @ 6.4g/t Au & 141g/t Ag

IMM24-380: 4.6m @ 3.5g/t Au & 242g/t Ag

IMS24-219: 3.3m @ 0.3g/t & 21g/t Ag

Sara

IMM24-386: 1.2m @ 3.2g/t Au & 250g/t Ag

IMM24-384: 1.6m @ 2.8g/t Au & 164g/t Ag

IMM24-390: 1.0m @ 2.9g/t Au & 123g/t Ag

IMM24-388: 1.3m @ 1.8g/t Au & 115g/t Ag

IMM24-389: 1.2m @ 1.8g/t Au & 111g/t Ag

Nicolas

IMM24-380: 1.2m @ 0.7g/t Au & 12g/t Ag

Josefa

IMM24-380: 1.5m @ 11.0g/t Au & 885g/t Ag

Andrea

IMM24-380: 0.9m @ 3.5g/t Au & 223g/t Ag

IMS24-221: 2.3m @ 1.7g/t Au & 60g/t Ag

 

During the third quarter, the Company expects to carry out four potential drill holes in the Kary vein (approximately 2,500m of drilling) as well as 12,000m of resource drilling in the Tesoro and Nicolas veins.

 

San Jose

During the second quarter of the year, the team carried out a further 4,460m of drilling for potential and resources in the Dalia, Emilia, Sigmoide Odin Sur vein structures

 

 

Vein

Results (potential)

Dalia

SJD-2800: 1.5m @ 30.8g/t Au & 66g/t Ag

SJD-2801: 0.8m @ 0.1/t Au & 3g/t Ag

Emilia

SJM-664: 1.0m @ 6.5g/t Au & 47g/t Ag

SJM-669: 0.8m @ 1.6g/t Au & 108g/t Ag

SJM-663: 0.8m @ 1.0g/t Au & 74g/t Ag

SJM-666: 0.9m @ 0.4g/t Au & 6g/t Ag

SJM-668: 0.8m @ 0.1g/t Au & 4g/t Ag

Sigmoide Odin Sur

SJD-2801: 0.9m @ 1.0g/t Au & 11g/t Ag

SJD-2802: 0.9m @ 0.2g/t Au & 47g/t Ag

Frea

SJD-2844: 3.9m @ 31.6g/t Au & 1,809g/t Ag

SJM-663: 12.1m @ 12.4g/t Au & 94g/t Ag

SJM-666: 12.0m @ 5.8g/t Au & 45g/t Ag

SJM-673: 3.6m @ 3.4g/t Au & 50g/t Ag

SJM-669: 2.9m @ 0.9g/t Au & 15g/t Ag

SJM-670: 1.0m @ 0.3g/t Au & 8g/t Ag

SJD-2847: 1.1m @ 0.3g/t Au & 3g/t Ag

SJD-2846: 3.0m @ 0.3g/t Au & 7g/t Ag

SJM-668: 4.9m @ 0.2g/t Au & 3g/t Ag

SJM-664: 6.2m @ 0.1g/t Au & 5g/t Ag

 

Mara Rosa

The Mara Rosa brownfield programme has already commenced and in the second quarter, 137m of potential drilling was executed in the Caxias-Anglelim target as well as 2,800m of resource drilling below the existing Posse pit which confirmed that mineralisation continues at lower levels.

 

Vein

Results (resources)

Posse

24POSP_003: 14.2m @ 0.8g/t Au

Including: 9.2m @ 1.1g/t Au

24POSP_004: 35.7m @ 1.4g/t Au

including: 9.2m @ 2.4g/t Au

                    11.0m @ 2.1g/t Au

                    1.1m @ 15.1g/t Au

 

The plan for the third quarter of 2024 is to carry out six holes of resource drilling once 2.495m of drilling has been completed below the Posse pit

 

Financial position

Total cash was approximately $89 million as at 30 June 2024 resulting in a net debt position of approximately $271 million. 

 

_____________________________________________________________________________________

 

Enquiries:

 

Hochschild Mining PLC

Charles Gordon                                                                          +44 (0)20 3709 3264

Head of Investor Relations

 

Hudson Sandler

Charlie Jack                                                                                +44 (0)207 796 4133

Public Relations

________________________________________________________________________________________

 

About Hochschild Mining PLC

Hochschild Mining PLC is a leading precious metals company listed on the London Stock Exchange (HOCM.L / HOC LN) and crosstrades on the OTCQX Best Market in the U.S. (HCHDF), with a primary focus on the exploration, mining, processing and sale of silver and gold. Hochschild has over fifty years' experience in the mining of precious metal epithermal vein deposits and currently operates three underground epithermal vein mines, two located in southern Peru and one in southern Argentina. Hochschild also owns the Mara Rosa Advanced Project in Brazil as well as numerous long-term projects throughout the Americas. ________________________________________________________________________________________

 

Forward looking statements

This announcement may contain forward looking statements. By their nature, forward looking statements involve risks and uncertainties because they relate to events and depend on circumstances that will or may occur in the future. Actual results, performance or achievements of Hochschild Mining PLC may, for various reasons, be materially different from any future results, performance or achievements expressed or implied by such forward looking statements.

 

The forward looking statements reflect knowledge and information available at the date of preparation of this announcement. Except as required by the Listing Rules and applicable law, the Board of Hochschild Mining PLC does not undertake any obligation to update or change any forward looking statements to reflect events occurring after the date of this announcement. Nothing in this announcement should be construed as a profit forecast.

 

Note

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (Regulation (EU) No.596/2014). Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

 

LEI: 549300JK10TVQ3CCJQ89

- ends -



[1]All equivalent figures assume the average gold/silver ratio for 2022 of 83x.

[2]Calculated as total number of accidents per million labour hours

[3]Calculated as total number of days lost per million labour hours.

[4]The ECO Score is an internally designed Key Performance Indicator measuring environmental performance in one number and encompassing numerous fronts including management of waste water, outcome of regulatory inspections and sound environmental practices relating to water consumption and the recycling of materials.

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.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
UK 100

Latest directors dealings