Endeavour Silver Reports 2023 Financial Results: Earnings Conference Call at 9am PST (12pm EST) Time
VANCOUVER, British Columbia, March 11, 2024 -- Endeavour Silver Corp. (“Endeavour” or the “Company”) (NYSE: EXK; TSX: EDR) announces its financial and operating results for the fourth quarter and year ended December 31, 2023. All dollar amounts are in US dollars (US$).
“The path to growth is never a straight line, so our ability to rise above challenges defines our success. During 2023, we kept focused on our main goals, while successfully navigating industry challenges” commented Dan Dickson, CEO of Endeavour Silver. “From a cost perspective, all Mexican miners faced overarching challenges, with persistent cost pressures across various channels. Our operations team demonstrated their resolve to overcome a significant challenge at Guanacevi, by elevating both mine and mill productivity levels above planned targets. As the remediation efforts extended into early Q4, the positive momentum from these initiatives reduced Q4 2023 cost metrics compared to Q3 2023 and will carry forward into the upcoming year.”
Mr. Dickson added, “With operating costs at their peak, we remain focused on cost discipline to offset inflationary and foreign exchange pressures while improving productivity. Bringing Terronera into production in late 2024 will provide the base we need for significant production growth and margin expansion as we move down the cost curve. We believe that project execution is our pathway to adding long-term value, as we position ourselves as a top silver investment vehicle for investors seeking industry leading growth.”
2023 Financial Highlights
- Production In-Line with Guidance: Consolidated production of 5,672,703 silver ounces (oz) and 37,858 gold oz for silver equivalent (1) production of 8.7 million oz, representing the Company’s third consecutive year of meeting or exceeding production guidance.
- Revenue: Revenue of $205.5 million from the sale of 5,669,760 oz of silver and 37,186 oz of gold at average realized prices of $23.76 per oz silver and $1,968 per oz gold.
- Multiple Items Resulted in Escalated Annual Costs; Significant Improvement in Q4: Cash costs(2) of $13.49 per oz payable silver were above guidance due to a strengthened Mexican Peso, inflationary pressures and lower production and All-in Sustaining Costs (2) of $22.93 per oz were above guidance due to the aforementioned higher costs. Fourth quarter cash costs(2) of $12.54 per oz payable silver and all-in sustaining costs (2) of $21.48 signal visible improvement from third quarter costs due to remedial measures implemented at Guanacevi, as productivity improved.
- Healthy Balance Sheet: Cash position of $35.3 million and $42.5 million in working capital(2). Cash decreased in Q4, as funds were spent on development activities at Terronera. During Q4, the Company raised gross proceeds of $39.3 million through issuances, primarily to fund the activities at Terronera.
- Cash Flow: $37.0 million in operating cash flow before working capital changes(2), and mine operating cash flow before taxes(2) of $64.4 million.
- Net Income: Net earnings of $6.1 million, or $0.03 per share, were impacted by inflationary pressures, foreign exchange and higher realized metal prices compared to the prior year.
- Construction Continues on Schedule at the Terronera Mine: Concrete work is well advanced and erection of steel for the grinding and flotation areas has started at year end (see news release dated February 12, 2024). Overall project progress reached 43% and the project remains on track for commissioning in Q4 2024.
Financial Overview (see appendix for consolidated financial statements)
| Three Months Ended December 31 | 2023 Highlights | Year Ended December 31 | ||||
| 2023 | 2022 | % Change | 2023 | 2022 | % Change | |
| Production | ||||||
| 1,406,423 | 1,830,835 | (23%) | Silver ounces produced | 5,672,703 | 5,963,445 | (5%) |
| 9,608 | 10,370 | (7%) | Gold ounces produced | 37,858 | 37,548 | 1% |
| 1,396,315 | 1,816,813 | (23%) | Payable silver ounces produced | 5,627,379 | 5,912,509 | (5%) |
| 9,440 | 10,196 | (7%) | Payable gold ounces produced | 37,189 | 36,901 | 1% |
| 2,175,063 | 2,660,435 | (18%) | Silver equivalent ounces produced(1) | 8,701,343 | 8,967,285 | (3%) |
12.54 11.65 8% Cash costs per silver ounce(2) 13.49 10.65 27%
| 17.66 | 15.03 | 17% | Total production costs per ounce(2)) | 18.55 | 14.70 | 26% |
| 21.48 | 19.38 | 11% | All-in sustaining costs per ounce (2) | 22.93 | 19.97 | 15% |
| 220,464 | 224,289 | (2%) | Processed tonnes | 874,382 | 834,542 | 5% |
| 144.59 | 135.71 | 7% | Direct operating costs per tonne(2) | 141.72 | 130.80 | 8% |
| 168.71 | 177.35 | (5%) | Direct costs per tonne(2) | 171.00 | 155.63 | 10% |
| Financial | ||||||
| 50.5 | 82.0 | (38%) | Revenue ($ millions) | 205.5 | 210.2 | (2%) |
| 1,332,648 | 2,816,882 | (53%) | Silver ounces sold | 5,669,760 | 6,464,869 | (12%) |
| 9,417 | 11,843 | (20%) | Gold ounces sold | 37,186 | 38,868 | (4%) |
| 23.78 | 21.86 | 9% | Realized silver price per ounce | 23.76 | 22.07 | 8% |
| 2,051 | 1,783 | 15% | Realized gold price per ounce | 1,968 | 1,814 | 9% |
| 3.0 | 8.0 | 62% | Net earnings (loss) ($ millions) | 6.1 | 6.2 | 1% |
| 3.6 | 8.1 | 56% | Adjusted net earnings (loss) (2) ($ millions) | 1.7 | 6.9 | (76%) |
| 5.4 | 21.7 | (75%) | Mine operating earnings ($ millions) | 36.6 | 51.5 | (29%) |
| 12.6 | 30.7 | (59%) | Mine operating cash flow before taxes ($ millions) (2) | 64.4 | 78.5 | (18%) |
| 9.8 | 22.5 | (56%) | Operating cash flow before working capital changes(2) | 37.0 | 54.0 | (31%) |
| 8.3 | 22.7 | (63%) | EBITDA(2) ($ millions) | 47.9 | 51.9 | (8%) |
| 42.5 | 93.6 | (55%) | Working capital (2) ($ millions) | 42.5 | 93.6 | (55%) |
| Shareholders | ||||||
| 0.01 | 0.04 | (75%) | Earnings (loss) per share – basic ($) | 0.03 | 0.03 | 0% |
| 0.02 | 0.04 | (50%) | Adjusted earnings (loss) per share – basic ($)(2) | 0.01 | 0.04 | (75%) |
| 0.05 | 0.12 | (59%) | Operating cash flow before working capital changes per share(2) | 0.19 | 0.30 | (37%) |
| 207,932,318 | 189,993,085 | 9% | Weighted average shares outstanding | 196,018,623 | 183,009,339 | 7% |
(1) Silver equivalent (AgEq) is calculated using an 80:1 silver:gold ratio.
(2) These are non-IFRS financial measures and ratios. Further details on these non-IFRS financial measures and ratios are provided at the end of this press release and in the MD&A accompanying the Company’s financial statements on SEDAR+ at www.sedarplus.ca.
Year Ended December 31, 2023
For the year ended December 31, 2023, revenue, net of $2.4 million of smelting and refining costs, decreased by 2% to $205.5 million (2022: $210.2 million).
The decrease in revenue is attributed to lower production compared to 2022 but was partially offset by higher precious metal prices realized during the year. During the period, the Company sold 5,669,760 oz silver and 37,186 oz gold for realized prices of $23.76 and $1,968 per oz, respectively, compared to sales of 6,464,869 oz silver and 38,868 oz gold for realized prices of $22.07 and $1,814 per oz, respectively, in 2022.
After cost of sales of $168.9 million (2022: $158.6 million), an increase of 6%, mine operating earnings were $36.6 million (2022: $51.5 million). The increase in cost of sales, despite lower sales, was due to higher costs as a result of inflation on a number of direct inputs, the impact of the appreciation of the Mexican peso on labour costs and direct inputs and higher royalty costs. Royalties increased 25% to $22.2 million (2022: $17.8 million) due to increased mining of the high-grade El Curso and El Porvenir extensions at the Guanaceví operation, which are subject to significant royalty rates.
The Company had operating earnings of $8.7 million (2022: $23.5 million) after exploration, evaluation and development costs of $15.1 million (2022: $16.2 million), general and administrative costs of $12.4 million (2022: $10.6 million), and a write-off of exploration properties of $0.4 million (2022: $0.7 million). In 2022, there were also care and maintenance costs of $0.6 million related to the El Compas mine which was sold in late 2022.
Earnings before income taxes were $18.2 million (2022: $25.0 million) after finance costs of $1.4 million (2022: $1.3 million), a foreign exchange gain of $4.7 million (2022: $1.9 million), a net gain on disposal of assets of $7.1 million primarily generated by the gain on the sale of the Cozamin royalty (2022: $2.5 million primarily from the gain on the sale of El Compas mine) and investment and other expense of $0.8 million (2022: $1.6 million).
The Company realized net earnings for 2023 of $6.1 million (2022: $6.2 million) after a tax expense of $12.1 million (2022: $18.7 million). Current income tax expense increased to $11.3 million (2022: $6.4 million) while deferred income tax expense decreased to $0.8 million (2022: $12.4 million) The deferred income tax expense of $0.8 million is derived from changes in temporary timing differences between deductions for accounting versus deductions for tax. During 2022, the changes in deferred taxes were driven primarily by the utilization of loss carryforwards at Guanacevi with no further loss carryforwards available to offset against current income tax in 2023.
Direct operating costs(2) on a per tonne basis increased to $141.72, up 8% compared with 2022 due to higher operating costs. Guanaceví and Bolañitos have seen increased labour, power and consumables costs primarily driven by inflationary pressure as well as the impact of a strengthened Mexican Peso. Direct costs per tonne (2) increased to $171.00, up 10% compared to 2022 due to the increase in direct operating costs as well as the increase in royalty costs.
Consolidated cash costs per oz, net of by-product credits, increased to $13.49 primarily due to the higher direct costs per tonne and a reduction in production partially offset by higher gold credits. All-in sustaining costs increased 15% to $22.93 per oz in 2023 due to the higher cash costs, an increase in allocated general and administrative expenses partially offset by a decrease in capital expenditures.
Consolidated cash costs per oz, net of by-product credits of $13.49 exceeded cash cost guidance of between a $10.00 and $11.00 range, primarily due to higher direct costs which were impacted by a strengthened Mexican Peso and higher inflationary pressure than anticipated. Cash costs, on a per ounce basis, were also impacted by realized production being on the lower end of guidance. All-In-Sustaining Costs (“AISC”) of $22.93 on a per oz basis was above guidance of $19.00 to $20.00 per ounce and similarly impacted by the increased costs.
The complete financial statements and management’s discussion & analysis can be viewed on the Company’s website, on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. All shareholders can receive a hard copy of the Company’s complete audited financial statements free of charge upon request. To receive this material in hard copy, please contact Investor Relations at 604-640-4804, toll free at 1-877- 685-9775 or by email at [email protected]
Conference Call
A conference call to discuss the Company’s annual 2023 financial results will be held today at 9:00 a.m. PT / 12:00 p.m. ET. To participate in the conference call, please dial the numbers below.
Date & Time: Monday, March 11, 2024 at 9:00 a.m. PT / 12:00 p.m. ET
Telephone: Toll-free in Canada and the US +1-800-319-4610 Local or International +1-604-638-5340 Please allow up to 10 minutes to be connected to the conference call.
Replay: A replay of the conference call will be available by dialing (toll-free)
+1-800-319-6413 in Canada and the US (toll-free) or +1-604-638-9010 outside of Canada and the US. The replay passcode is 0627#. The replay will also be available on the Company’s website at www.edrsilver.com.
About Endeavour Silver – Endeavour is a mid-tier precious metals mining company that operates two high-grade underground silver-gold mines in Mexico. Endeavour is advancing construction of the Terronera Project and exploring its portfolio of exploration projects in Mexico, Chile and the United States to facilitate its goal to become a premier senior silver producer. Our philosophy of corporate social integrity creates value for all stakeholders.
Contact Information:
Galina Meleger, VP, Investor Relations Email: [email protected] Website: www.edrsilver.com
Follow Endeavour Silver on Facebook, X, Instagram and LinkedIn
Endnotes
1 Silver equivalent (AgEq)
AgEq is calculated using an 80:1 silver:gold ratio.
2 Non-IFRS and Other Financial Measures and ratios
Certain non-IFRS and other non-financial measures and ratios are included in this press release, including cash costs per silver ounce, total production costs per ounce, all-in costs per ounce, all-in sustaining cost (“AISC”) per ounce, direct operating costs per tonne, direct costs per tonne, realized silver price per ounce, realized gold price per ounce, adjusted net earnings (loss) adjusted net earnings (loss) per share, mine operating cash flow before taxes, working capital, operating cash flow before working capital adjustments, operating cash flow before working capital changes per share, earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA per share and sustaining and growth capital.
Please see the December 31, 2023, MD&A for explanations and discussion of these non-IFRS and other non-financial measures and ratios. The Company believes that these measures and ratios, in addition to conventional measures and ratios prepared in accordance with International Financial Reporting Standards (“IFRS”), provide management and investors an improved ability to evaluate the underlying performance of the Company. The non-IFRS and other non-financial measures and ratios are intended to provide additional information and should not be considered in isolation or as a substitute for measures or ratios of performance prepared in accordance with IFRS. These measures and ratios do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to other issuers. Certain additional disclosures for these non- IFRS measures have been incorporated by reference and can be found in the section “Non-IFRS Measures” in the December 31, 2023 MD&A available on SEDAR+ at www.sedarplus.ca.
Reconciliation of Working Capital
| Expressed in thousands US dollars | As at December 31, 2023 | As at December 31, 2022 |
|---|---|---|
| Current assets | $100,773 | $146,333 |
| Current liabilities | 58,244 | 52,749 |
| Working capital | $42,529 | $93,584 |
Reconciliation of Adjusted Net Earnings (Loss) and Adjusted Net Earnings (Loss) Per Share
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| (except for share numbers and per share amounts) | 2023 | 2022 | 2023 | 2022 |
| Net earnings (loss) for the period per financial statements | $7,961 | $7,961 | $6,201 | $6,201 |
| Gain on sale of Cozamin royalty | - | - | (6,990) | - |
| Gain on disposal of El Compas mine and equipment, net of tax | - | - | - | (2,733) |
| Change in fair value of investments | 525 | 104 | 2,522 | 3,470 |
| Adjusted net earnings (loss) | $3,574 | $8,065 | $1,655 | $6,938 |
| Basic weighted average share outstanding | 207,932,318 | 189,993,085 | 196,018,623 | 183,009,339 |
| Adjusted net earnings (loss) per share | $0.02 | $0.04 | $0.01 | $0.04 |
Reconciliation of Mine Operating Cash Flow Before Taxes
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |
| Mine operating earnings per financial statements | $5,352 | $21,655 | $36,611 | $51,525 |
| Share-based compensation | 44 | 89 | (74) | 442 |
| Amortization and depletion | 7,181 | 8,945 | 27,885 | 25,179 |
| Provision for warehouse inventory | - | - | - | 1,323 |
| Mine operating cash flow before taxes | $12,577 | $30,689 | $64,422 | $78,469 |
Reconciliation of Operating Cash Flow Before Working Capital Changes and Operating Cash Flow Before Working Capital Changes Per Share
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| (except for per share amounts) | 2023 | 2022 | 2023 | 2022 |
| Cash from (used in) operating activities per financial statements | $6,706 | $44,391 | $11,771 | $54,993 |
| Net changes in non-cash working capital per financial statements | (3,085) | 21,924 | (25,243) | 967 |
| Operating cash flow before working capital changes | $9,791 | $22,467 | $37,014 | $54,026 |
| Basic weighted average shares outstanding | 207,932,318 | 189,993,085 | 196,018,623 | 183,009,339 |
| Operating cash flow before working capital changes per share | $0.05 | $0.12 | $0.19 | $0.30 |
Reconciliation of EBITDA and Adjusted EBITDA
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 |
Net earnings (loss) for the period per financial statements $3,049 $3,049 $6,123 $6,123
| Depreciation – cost of sales | 7,181 | 7,181 | 27,885 | 27,885 |
| Depreciation – exploration | 80 | 80 | 528 | 528 |
| Depreciation – general & administration | 197 | 197 | 376 | 376 |
| Finance costs | 164 | 233 | 822 | 816 |
| Current income tax expense | 207 | 2,850 | 11,344 | 6,376 |
| Deferred income tax expense | (2,544) | 2,345 | 786 | 12,372 |
| EBITDA | $8,334 | $22,668 | $47,864 | $51,853 |
| Share based compensation | 714 | 619 | 3,618 | 3,878 |
| Gain on sale of Cozamin royalty | - | - | (6,990) | - |
| Gain on disposal of El Compas mine and equipment, net of tax | - | - | - | (2,733) |
| Change in fair value of investments | 525 | 104 | 2,522 | 3,470 |
| Adjusted EBITDA | $9,573 | $23,391 | $47,014 | $56,468 |
Reconciliation of Cash Cost Per Silver Ounce, Total Production Costs Per Ounce, Direct Operating Costs Per Tonne, Direct Costs Per Tonne
| Expressed in thousands US dollars | Years Ended December 31, 2023 | Years Ended December 31, 2022 | ||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Direct production costs per financial statements | $79,842 | $38,989 | $118,831 | $74,423 | $39,457 | $113,880 |
| Smelting and refining costs included in net revenue | - | 2,451 | 2,451 | - | 3,029 | 3,029 |
| Opening finished goods | (4,953) | (245) | (5,198) | (10,093) | (2,857) | (12,950) |
| Closing finished goods | 7,137 | 699 | 7,836 | 4,953 | 245 | 5,198 |
| Direct operating costs | 82,026 | 41,894 | 123,920 | 69,283 | 39,874 | 109,157 |
| Royalties | 21,937 | 273 | 22,210 | 17,554 | 257 | 17,811 |
| Special mining duty (1) | 2,862 | 530 | 3,392 | 2,612 | 302 | 2,914 |
| Direct costs | 106,825 | 42,697 | 149,522 | 89,449 | 40,433 | 129,882 |
| By-product gold sales | (29,273) | (43,925) | (73,198) | (27,569) | (42,932) | (70,501) |
| Opening gold inventory fair market value | 2,740 | 354 | 3,094 | 1,900 | 4,784 | 6,684 |
| Closing gold inventory fair market value | (2,909) | (619) | (3,528) | (2,740) | (354) | (3,094) |
| Cash costs net of by-product | 77,383 | (1,493) | 75,890 | 61,040 | 1,931 | 62,971 |
| Amortization and depletion | 15,481 | 12,404 | 27,885 | 14,129 | 11,050 | 25,179 |
| Share-based compensation | (17) | (57) | (74) | 221 | 221 | 442 |
| Opening finished goods depreciation | (862) | (79) | (941) | (1,965) | (635) | (2,600) |
| Closing finished goods depreciation | 1,459 | 197 | 1,656 | 862 | 79 | 941 |
| Total production costs | $93,444 | $10,972 | $104,416 | $74,287 | $12,646 | $86,933 |
| Year Ended December 31, 2023 | Year Ended December 31, 2022 | |||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Throughput tonnes | 433,409 | 440,973 | 874,382 | 412,303 | 422,239 | 834,542 |
| Payable silver ounces | 5,089,921 | 537,458 | 5,627,379 | 5,340,553 | 587,978 | 5,912,509 |
| Cash costs per silver ounce | $15.20 | ($2.78) | $13.49 | $11.46 | $3.28 | $10.65 |
| Total production costs per ounce | $18.36 | $20.41 | $18.55 | $13.95 | $21.51 | $14.70 |
| Direct operating costs per tonne | $189.26 | $95.00 | $141.72 | $168.04 | $94.43 | $130.80 |
| Direct costs per tonne | $246.48 | $96.82 | $171.00 | $216.95 | $95.76 | $155.63 |
| Expressed in thousands US dollars | Three Months Ended December 31, 2023 | Three Months Ended December 31, 2022 | ||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Direct production costs per financial statements | 22,956 | 9,861 | 32,817 | 33,586 | 9,235 | 42,821 |
Smelting and refining costs included in net revenue - 506 506 - 694 694
| Opening finished goods | (8,627) | (656) | (9,283) | (18,080) | (195) | (18,275) |
| Closing finished goods | 7,137 | 699 | 7,836 | 4,953 | 245 | 5,198 |
| Direct operating costs | 21,466 | 10,410 | 31,876 | 20,459 | 9,979 | 30,438 |
| Royalties | 5,033 | 72 | 5,105 | 8,430 | 49 | 8,479 |
| Special mining duty (1) | 62 | 151 | 213 | 845 | 16 | 861 |
| Direct costs | 26,561 | 10,633 | 37,194 | 29,734 | 10,044 | 39,778 |
| By-product gold sales | (7,045) | (12,271) | (19,316) | (11,591) | (9,527) | (21,118) |
| Opening gold inventory fair market value | 2,345 | 815 | 3,160 | 5,368 | 240 | 5,608 |
| Closing gold inventory fair market value | (2,909) | (619) | (3,528) | (2,740) | (354) | (3,094) |
| Cash costs net of by-product | 18,952 | (1,442) | 17,510 | 20,771 | 403 | 21,174 |
| Depreciation | 3,942 | 3,239 | 7,181 | 6,160 | 2,785 | 8,945 |
| Share-based compensation | 33 | 11 | 44 | 45 | 44 | 89 |
| Opening finished goods depreciation | (1,509) | (222) | (1,731) | (3,776) | (60) | (3,836) |
| Closing finished goods depreciation | 1,459 | 197 | 1,656 | 862 | 79 | 941 |
| Total production costs | $22,877 | $1,783 | $24,660 | $24,062 | $3,251 | $27,313 |
| Three Months Ended December 31, 2023 | Three Months Ended December 31, 2022 | |||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Throughput tonnes | 110,781 | 109,683 | 220,464 | 119,305 | 104,984 | 224,289 |
| Payable silver ounces | 1,267,864 | 128,451 | 1,396,315 | 1,675,322 | 141,491 | 1,816,813 |
| Cash costs per silver ounce | $14.95 | ($11.23) | $12.54 | $12.40 | $2.85 | $11.65 |
| Total production costs per ounce | $18.04 | $13.88 | $17.66 | $14.36 | $22.98 | $15.03 |
| Direct operating costs per tonne | $193.77 | $94.91 | $144.59 | $171.48 | $95.05 | $135.71 |
| Direct costs per tonne | $239.76 | $96.94 | $168.71 | $249.23 | $95.67 | $177.35 |
Reconciliation of All-In Costs Per Ounce and AISC per ounce
| Expressed in thousands US dollars | Year Ended December 31, 2023 | Year Ended December 31, 2022 | ||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Cash costs net of by-product | $77,383 | ($1,493) | $75,890 | $61,040 | $1,931 | $62,971 |
| Operations share-based compensation | (17) | (57) | (74) | 221 | 221 | 442 |
| Corporate general and administrative | 6,354 | 2,419 | 8,773 | 5,439 | 1,951 | 7,390 |
| Corporate share-based compensation | 2,328 | 886 | 3,214 | 2,214 | 795 | 3,009 |
| Reclamation - amortization/accretion | 313 | 263 | 576 | 268 | 211 | 479 |
| Mine site expensed exploration | 1,354 | 1,352 | 2,706 | 1,351 | 1,158 | 2,509 |
| Intangible payments | - | - | - | 30 | 11 | 41 |
| Equipment loan payments | 819 | 1,805 | 2,624 | 981 | 1,955 | 2,936 |
| Capital expenditures sustaining | 24,631 | 10,708 | 35,339 | 26,561 | 11,756 | 38,317 |
| All-In-Sustaining Costs | $113,164 | $15,884 | $129,048 | $98,105 | $19,989 | $118,094 |
| Growth exploration and evaluation | 11,401 | 12,626 | ||||
| Growth capital expenditures | 82,448 | 35,450 | ||||
| All-In-Costs | $222,897 | $166,170 |
| Year Ended December 31, 2023 | Year Ended December 31, 2022 | |||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Throughput tonnes | 433,409 | 440,973 | 874,382 | 412,303 | 422,239 | 834,542 |
| Payable silver ounces | 5,089,921 | 537,458 | 5,627,379 | 5,324,531 | 587,978 | 5,912,509 |
| Silver equivalent production (ounces) | 6,301,637 | 2,399,706 | 8,701,343 | 6,599,353 | 2,367,932 | 8,967,285 |
Sustaining cost per ounce $22.23 $29.55 $22.93 $18.43 $34.00 $19.97
| Expressed in thousands US dollars | Three Months Ended December 31, 2023 | Three Months Ended December 31, 2022 | ||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Cash costs net of by-product | $18,952 | ($1,442) | $17,510 | $20,771 | $403 | $21,174 |
| Operations share-based compensation | 33 | 11 | 44 | 45 | 44 | 89 |
| Corporate general and administrative | 1,423 | 550 | 1,973 | 1,771 | 506 | 2,277 |
| Corporate share-based compensation | 404 | 156 | 560 | 365 | 67 | 432 |
| Reclamation - amortization/accretion | 78 | 66 | 144 | 70 | 53 | 123 |
| Mine site expensed exploration | 286 | 350 | 636 | 323 | 295 | 618 |
| Equipment loan payments | 140 | 340 | 480 | 245 | 489 | 734 |
| Capital expenditures sustaining | 5,944 | 2,700 | 8,644 | 6,653 | 3,103 | 9,756 |
| All-In-Sustaining Costs | $27,259 | $2,732 | $29,991 | $30,243 | $4,960 | $35,203 |
| Growth exploration and evaluation | 1,609 | 4,170 | ||||
| Growth capital expenditures | 32,826 | 18,672 | ||||
| All-In-Costs | $64,426 | $58,045 |
| Three Months Ended December 31, 2023 | Three Months Ended December 31, 2022 | |||||
|---|---|---|---|---|---|---|
| Guanaceví | Bolañitos | Total | Guanaceví | Bolañitos | Total | |
| Throughput tonnes | 110,781 | 109,683 | 220,464 | 119,305 | 104,984 | 224,289 |
| Payable silver ounces | 1,267,864 | 128,451 | 1,396,315 | 1,675,322 | 141,491 | 1,816,813 |
| Silver equivalent production (ounces) | 1,569,359 | 605,704 | 2,175,063 | 2,075,243 | 585,192 | 2,660,435 |
| Sustaining cost per ounce | $21.50 | $21.27 | $21.48 | $18.05 | $35.06 | $19.38 |
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |
| Mine site expensed exploration | $636 | $618 | $2,706 | $2,509 |
| Growth exploration, evaluation and development | 1,609 | 4,170 | 11,401 | 12,626 |
| Total exploration, evaluation and development | 2,245 | 4,788 | 14,107 | 15,135 |
| Exploration, evaluation and development depreciation | 80 | 276 | 528 | 624 |
| Exploration, evaluation and development share-based compensation | 110 | 99 | 478 | 427 |
| Exploration, evaluation and development expense | $2,435 | $5,163 | $15,113 | $16,186 |
Reconciliation of Sustaining Capital and Growth Capital
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |
| Capital expenditures sustaining | $8,644 | $9,756 | $35,339 | $38,317 |
| Growth capital expenditures | 32,826 | 18,672 | 82,448 | 35,450 |
| Acquisition capital expenditures | - | (50) | - | 35,948 |
| Property, plant and equipment expenditures per Consolidated Statement of Cash Flows | $41,470 | $28,378 | $117,787 | $109,715 |
Reconciliation of Realized Silver Price Per Ounce and Realized Gold Price Per Ounce
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 |
Gross silver sales $31,689 $61,565 $134,716 $142,688
| Silver ounces sold | 1,332,648 | 2,816,881 | 5,669,760 | 6,464,868 |
| Realized silver price per ounces | $23.78 | $21.86 | $23.76 | $22.07 |
| Expressed in thousands US dollars | Three Months Ended December 31 | Years Ended December 31 | ||
|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |
| Gross gold sales | $19,316 | $21,118 | $73,198 | $70,501 |
| Gold ounces sold | 9,417 | 11,843 | 37,186 | 38,868 |
| Realized gold price per ounces | $2,051 | $1,783 | $1,968 | $1,814 |
Cautionary Note Regarding Forward-Looking Statements
This news 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. Such forward-looking statements and information herein include but are not limited to statements regarding the development and financing of the Terronera Project including: anticipated timing of the project; anticipated timing of completion of conditions precedent to drawdown under the Debt Facility, estimated project economics, Terronera’s forecasted operations, costs and expenditures, and the timing and results of various related activities, Endeavour’s anticipated performance in 2024 including changes in mining operations and forecasts of production levels, anticipated production costs and all-in sustaining costs and the timing and results of various activities. The Company does not intend to and does not assume any obligation to update such forward-looking statements or information, other than as required by applicable law.
Forward-looking statements or information involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, production levels, performance or achievements of Endeavour and its operations to be materially different from those expressed or implied by such statements. Such factors include but are not limited changes in production and costs guidance; the ongoing effects of inflation and supply chain issues on mine economics; national and local governments, legislation, taxation, controls, regulations and political or economic developments in Canada and Mexico; financial risks due to precious metals prices; operating or technical difficulties in mineral exploration, development and mining activities; risks and hazards of mineral exploration, development and mining; the speculative nature of mineral exploration and development; risks in obtaining necessary licenses and permits; satisfaction of conditions precedent to drawdown under the Debt Facility; the ongoing effects of inflation and supply chain issues on the Terronera Project economics; fluctuations in the prices of silver and gold, fluctuations in the currency markets (particularly the Mexican peso, Chilean peso, Canadian dollar and U.S. dollar); and challenges to the Company’s title to properties; as well as those factors described in the section “risk factors” contained in the Company’s most recent form 40F/Annual Information Form filed with the S.E.C. and Canadian securities regulatory authorities.
Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to: the continued operation of the Company’s mining operations, no material adverse change in the market price of commodities, forecasted mine economics as of 2024, mining operations will operate and the mining products will be completed in accordance with management’s expectations and achieve their stated production outcomes, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or information, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended. There can be no assurance that any forward-looking statements or information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.
Appendix
ENDEAVOUR SILVER CORP.
CONSOLIDATED STATEMENTS OFCOMPREHENSIVE EARNINGS (LOSS)
(expressed in thousands of US dollars, except for shares and per share amounts)
Years ended
December 31, December 31, 2023 2022
Revenue $ 205,463 $ 210,160
Cost of sales:
| Direct production costs | 118,831 | 113,880 |
| Royalties | 22,210 | 17,811 |
| Share-based payments | (74) | 442 |
| Depreciation | 27,885 | 25,179 |
Write down of inventory to net realizable value - 1,323 168,852 158,635
Mine operating earnings 36,611 51,525
Expenses:
| Exploration, evaluation and development | 15,113 | 16,186 | |
| General and administrative | 12,363 | 10,613 | |
| Care and maintenance costs | - | 580 | |
| Write off of mineral properties | 435 | 682 |
27,911 28,061
Operating earnings 8,700 23,464
Finance costs 1,398 1,300
Other income (expense):
| Foreign exchange gain | 4,709 | 1,853 |
| Gain on asset disposal | 7,072 | 2,503 |
| Investment and other | (830) | (1,571) |
10,951 2,785
Earnings before income taxes 18,253 24,949
Income tax expense:
Current income tax expense 11,344 6,376 Deferred income tax expense 786 12,372 12,130 18,748
| Net earnings and comprehensive earnings | $ | 6,123 | $ | 6,201 |
| Basic earnings per share | $ | 0.03 | $ | 0.03 |
| Diluted earnings per share | $ | 0.03 | $ | 0.03 |
| Basic weighted average number of shares outstanding | 196,018,623 | 183,009,339 | ||
| Diluted weighted average number of shares outstanding | 197,764,799 | 185,349,634 |
ENDEAVOUR SILVER CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (expressed in thousands of US dollars)
December 31, December 31, 2023 2022
ASSETS
Current assets
| Cash and cash equivalents | $ 35,286 | $ 83,391 |
| Other investments | 5,135 | 8,647 |
| Accounts and other receivables | 22,276 | 14,136 |
| Income tax receivable | 3,268 | 4,024 |
| Inventories | 27,258 | 19,184 |
| Prepaids and other asets | 7,550 | 16,951 |
| Total current assets | 100,773 | 146,333 |
| Non-current income tax receivable | 4,262 | 3,570 |
| Non-current other investments | - | 1,388 |
| Non-current IVA receivable | 23,320 | 10,154 |
| Non-current loan receivable | 1,874 | 2,729 |
| Right-of-use leased assets | 706 | 806 |
| Deferred financing fees | 7,545 | - |
| Other non-current assets | 21,670 | 565 |
| Mineral properties, plant and equipment | 314,657 | 233,892 |
| Total assets | $ 474,807 | $ 399,437 |
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
| Accounts payable and accrued liabilities | $ 46,146 | $ 39,831 |
| Income taxes payable | 7,801 | 6,616 |
| Loans payable | 3,861 | 6,041 |
| Lease liabilities | 436 | 261 |
| Total current liabilities | 58,244 | 52,749 |
| Loans payable | 4,658 | 8,469 |
| Lease liabilities | 575 | 812 |
| Provision for reclamation and rehabilitation | 8,745 | 7,601 |
| Deferred income tax liability | 13,730 | 12,944 |
| Other non-current liabilities | 2,514 | 968 |
| Total liabilities | 88,466 | 83,543 |
Shareholders' equity Common shares, unlimited shares authorized, no par value, issued, issuable
| and outstanding 217,245,492 shares (Dec 31, 2022 - 189,995,563 shares) | 722,695 | 657,866 |
| Contributed surplus | 4,556 | 6,115 |
| Retained deficit | (340,910) | (348,087) |
| Total shareholders' equity | 386,341 | 315,894 |
| Total liabilities and shareholders' equity | $ 474,807 | $ 399,437 |
ENDEAVOUR SILVER CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (expressed in thousands of US dollars)
Years ended
December 31, December 31, 2023 2022
Operating activities
Net earnings for the year $ 6,123 $ 6,201
Items not affecting cash:
| Share-based compensation | 3,617 | 3,878 |
| Depreciation | 28,789 | 26,088 |
| Deferred income tax expense | 786 | 12,372 |
| Unrealized foreign exchange loss | 1,421 - | 344 |
| Finance costs | 1,398 | 1,300 |
| Accretion of loans receivable | (395) | (97) |
| Long term employee benefits | 1,508 | 968 |
| Write off of exploration properties | 435 | 682 |
| Write down of warehouse inventory to net realizable value | - | 1,323 |
| Gain on asset disposal | (7,072) | (2,503) |
| Loss on other investments | 2,522 | 3,470 |
| Performance and deferred share units settled in cash | (2,118) | - |
| Net changes in non-cash working capital | (25,243) | 967 |
| Cash from operating activities | 11,771 | 54,993 |
Investing activities
| Proceeds from disposal of property, plant and equipment | 7,567 | 350 | |
| Payment for mineral properties, plant and equipment | (117,787) | (109,715) | |
| Purchase of other investments | (73) | (2,119) | |
| Proceeds from disposal of other investments | 2,451 | - | |
| Redemption of (investment in) non-current deposits | (153) | 34 | |
| Cash used in investing activities | (107,995) | (111,450) |
Financing activities
| Repayment of loans payable | (5,991) | (5,054) |
| Repayment of lease liabilities | (342) | (219) |
| Interest paid | (822) | (790) |
Proceeds from public equity offerings 46,001
62,656
| Proceeds from exercise of options | 2,453 | 1,607 |
| Payment of deferred financing fees | (7,545) | - |
| Proceeds from loans receivable | 800 | - |
| Payment of share issuance costs | (1,990) | (2,885) |
| Performance and deferred share units witholding tax settlement | (294) | (1,904) |
| Cash from financing activities | 48,925 | 36,756 |
| Effect of exchange rate change on cash and cash equivalents | (806) | (211) |
| Decrease in cash and cash equivalents | (48,105) | (19,912) |
| Cash and cash equivalents, beginning of the year | 83,391 | 103,303 |
| Cash and cash equivalents, end of the year | $ 35,286 | $ 83,391 |