FIRST MAJESTIC SILVER CORP. |
Suite 1805 925 West Georgia Street |
Vancouver, B.C., Canada V6C 3L2 |
Telephone: (604) 688-3033 Fax: (604) 639-8873 |
Toll Free: 1-866-529-2807 |
Web site: www.firstmajestic.com; E-mail:
info@firstmajestic.com |
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NEWS RELEASE |
TSX Exchange FR |
March 22, 2010 |
OTCQX FRMSF |
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Frankfurt FMV (WKN: A0LHKJ) |
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Year End & Fourth Quarter Financial
Results
FIRST MAJESTIC SILVER CORP. (FR-TSX) (the "Company") is
pleased to announce the audited financial results for the Company's year ending
December 31, 2009 and its fourth quarter ending December 31, 2009. The full
version of the financial statements and the management discussion and analysis
can be viewed on the Company's web site at www.firstmajestic.com or on SEDAR at
www.sedar.com.
Year End Highlights |
Gross Revenue |
CDN$71.5 million |
Net Revenue |
CDN$59.5 million |
Mine Operating
Earnings |
CDN$18.5 million |
Net Income after
taxes |
CDN$6.3 million |
Earnings Per Share
(EPS) |
CDN$0.08 |
Silver Equivalent
Production |
4,337,103 oz. Ag eq. |
Silver Equivalent
Oz. Sold |
4,233,703 oz. Ag eq. |
Direct Cash Costs
per ounce |
US$5.61 |
Cash Costs per
Ounce (all in) |
US$8.49 |
Average Gross
Revenue per Ounce Sold |
CDN$16.89 (US$ 14.79) |
Fourth Quarter Highlights |
Gross Revenue |
CDN$21.4 million |
Net Revenue |
CDN$18.4 million |
Mine Operating
Earnings |
CDN$8.1 million |
Net Income after
taxes |
CDN$2.5 million |
Earnings Per Share
(EPS) |
CDN$0.03 |
Silver Equivalent
Production |
1,249,568 oz. Ag eq. |
Silver Equivalent
Oz. Sold |
1,145,562 oz. Ag eq. |
Direct Cash Costs
per ounce |
US$5.69 |
Average Gross
Revenue per Ounce Sold |
CDN$18.71(US$ 17.72) |
2009 ANNUAL AND Q4 FINANCIAL PERFORMANCE AND
HIGHLIGHTS
- Consolidated gross revenue (prior to smelting, refining and metal
deductions) for the year ended 2009 was $71.5 million compared to $56.1
million in 2008, an increase of $15.4 million or 27.5%.
- Consolidated gross revenue (prior to smelting, refining and metal
deductions) for the quarter ended December 31, 2009 (Q4) was $21,436,456
compared to $11,712,165 for the quarter ended December 31, 2008 for an
increase of $9,724,291, or 83%. The improvement in revenues in the fourth
quarter of 2009 is attributable to a 38% increase in equivalent silver ounces
sold and a 32% increase in the average gross revenue per ounce realized. These improvements resulted in net revenue for the
fourth quarter increasing from $9,106,605 in 2008 to $18,374,117 in 2009, an
increase of 102%.
2
- In 2009 the Company shipped (sold) 4,233,703 ounces of silver equivalent
at an average price of $16.89 per ounce (US$14.79) compared to 3,590,202
ounces in 2008 at an average price of $15.63 per ounce (US$14.66),
representing an increase of 18% in shipments. The average COMEX trading price
of silver in 2009 was US$14.68 per ounce.
- Total production for 2009 was 4,337,103 ounces of silver equivalents
consisting of 3,797,520 ounces of silver, 2,670 ounces of gold, 6,587,074
pounds of lead and 8,913 pounds of zinc. This compares to the 4,229,998 ounces
of silver equivalents produced in 2008, which consisted of 3,654,698 ounces of
silver, 1,661 ounces of gold, 7,457,707 pounds of lead and 425,710 pounds of
zinc.
- Net sales revenue (after smelting and refining charges and metals
deductions) for 2009 was $59.5 million, an increase of 34.3% compared to $44.3
million for 2008. Smelting and refining charges and metal deductions decreased
to 17% of gross revenue in 2009 compared to 21% of gross revenue in 2008.
Average smelting charges for doré in 2009 were US$0.48 per equivalent silver
ounce whereas for concentrates charges were US$3.96 per equivalent silver
ounce.
- The Company generated net income for 2009 of $6.3 million, or earnings per
common share (EPS) of $0.08 compared to a net loss in 2008 of $5.1 million or
a loss per common share of ($0.07). Net income for 2009 was after deducting
non-cash stock-based compensation expense of $3.3 million, a write-down of
mineral properties of $2.6 million, a write-down of marketable securities of
$0.4 million and an income tax recovery of $3.2 million. Neglecting the effect
of write-downs, earnings per share in 2009 would have been $0.11 per share.
- Net income for the quarter ended December 31, 2009 was $2,492,488 or $0.03
per common share compared to a net loss of $5,538,906 or ($0.08) per common
share in the quarter ended December 31, 2008, for an increase of $8,031,394.
- Direct cash costs per ounce of silver for 2009 decreased to US$5.61 per
ounce of silver, compared to US$5.87 per ounce of silver for 2008. During
2009, the Companys operations achieved operational efficiencies resulting in
reductions in production costs per tonne and cash costs per ounce.
- Direct cash costs per ounce of silver for Q4 of 2009 decreased to US$5.69
per ounce of silver, compared to US$6.37 per ounce of silver for Q4 of 2008.
- Mine operating earnings for 2009 increased by 146% to $18.5 million, an
increase of $11.0 million, compared to mine operating earnings of $7.5 million
for 2008, due to an increase in sales volume from 3.6 million ounces of silver
equivalent in 2008 to 4.2 million ounces in 2009, combined with an increase in
sales revenue per ounce from $15.63 (US$14.66) in 2008 to $16.89 (US$14.79) in
2009.
- Mine operating earnings increased by 818% to $8,092,993 for the quarter
ended December 31, 2009 from a mine operating loss of $1,126,697 for the same
quarter in the prior year. This was primarily due to the increase in net
revenue.
- The Company had operating income of $4.5 million for 2009 compared to an
operating loss of $3.7 million for 2008, an increase of $8.2 million or 220%.
- Operating income increased by $5,758,869 or 152% to $1,971,450 for the
quarter ended December 31, 2009, from an operating loss of $3,787,419 for the
quarter ended December 31, 2008, due to the increase in mine operating
earnings.
- During the fourth quarter of 2009, the new cyanidation plant at the La
Encantada Silver Mine was commissioned and the ramp up process commenced. By
the beginning of the second quarter of 2010, this new plant is expected to
achieve commercial production, reaching full capacity of 3,500 tonnes-per-day
and producing at an annualized rate of over four million ounces in Q2 of 2010.
Total capitalized construction in progress at La Encantada at December 31,
2009 consisted of $31.3 million (US$29.8 million) with a further $2.9 million
(US$2.7 million) advanced to contractors for equipment.
- During the year ended December 31, 2009, the Company raised a total of
$35.3 million through a combination of debt and equity. New funds consisted of
$29.4 million from equity issuances, $4.3 million from a Mexican government
sponsored development loan, as well as $1.6 million from the pre-sale of lead
concentrates from the La Parrilla mine. This compares to $41.6 million raised
in the year ended December 31, 2008.
- During the year ended December 31, 2009, the Company invested $14.0
million in its mineral properties and a further $19.4 million in additions to
plant and equipment on a cash basis. This compares to $24.5 million invested
in its mineral properties and a further $14.9 million in additions to plant
and equipment in the year ended December 31, 2008.
- During 2009, the Company reduced current liabilities by $19.6 million.
This was achieved by (i) placing $14.3 million in a lawyers trust pending the
outcome of the Companys action against a previous majority owner of First
Silver, (ii)
settling certain other current liabilities
amounting to $2.7 million by the issuance of 1,191,852 common shares, and
(iii) through additional reductions of accounts payable and accrued
liabilities by $2.6 million.
3
- In November 2009, First Majestic acquired Normabec Mining Resources Ltd.
(Normabec) in an all-share transaction by way of plan of arrangement (the
"Arrangement"). First Majestic acquired Normabec in exchange for the issuance
directly to Normabec's shareholders of 0.060425 First Majestic shares and 0.25
shares of Brionor Resources Inc., a newly formed entity, for each Normabec
common share outstanding. Normabec's primary asset is the Real de Catorce
Silver Project which is located in the northern portion of San Luís Potosí
State, Mexico. The results of operations of Normabec were consolidated into
the operations of the Company effective November 14, 2009.
In Summary
First Majestics year ended on a very positive note, with the
fourth quarter results being the strongest in the Companys history. It is
noteworthy that the strong results in 2009 can be primarily credited to the La
Parrilla and San Martin operations as the La Encantada expansion project was
commissioned in November and had not delivered significant production increases
to year end.
Management is confident that 2010 will be an even better year
financially for the Company, due to increases in production and profitability
expected from the new 3,500 tpd cyanidation mill at La Encantada which is in the
ramp up stage and is expected to reach full production in Q2.
First Majestic is a producing silver company focused in México
and is aggressively pursuing its business plan to become a senior silver
producer through the development of its existing assets and the pursuit through
acquisition of additional assets that contribute to achieving its corporate
growth objectives.
FOR FURTHER INFORMATION contact info@firstmajestic.com, visit
our website at www.firstmajestic.com or call our toll free number
1.866.529.2807.
FIRST MAJESTIC SILVER CORP.
Signed
Keith Neumeyer, President & CEO
This press release includes certain "Forward-Looking
Statements" within the meaning of section 21E of the United States Securities
Exchange Act of 1934, as amended. All statements, other than statements of
historical fact, included herein, including without limitation, statements
regarding potential mineralization and reserves, exploration results and future
plans and objectives of First Majestic Silver Corp. are forward-looking
statements that involve various risks and uncertainties. There can be no
assurance that such statements will prove to be accurate and actual results and
future events could differ materially from those anticipated in such
statements.