Andean Precious Metals Reports Second Quarter 2024 Operating and Financial Results Record Consolidated Production and Revenues
NEWS RELEASE
TSX-V: APM OTCQX: ANPMF
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ANDEAN PRECIOUS METALS REPORTS SECOND QUARTER 2024
OPERATING AND FINANCIAL RESULTS
RECORD CONSOLIDATED PRODUCTION AND REVENUES
TORONTO, ON – August 13, 2024 – Andean Precious Metals Corp. (“Andean” or the “Company”)
(TSX-V: APM) (OTCQX: ANPMF) is pleased to report its operating highlights and financial results for
the three and six months ended June 30, 2024. All amounts are in United States Dollars unless
otherwise stated. This news release should be read together with Andean’s management discussion
and analysis (“MD&A”) and condensed consolidated interim financial statements for the three and six
months ended June 30, 2024 (the “ Financial Statements”) which are available under the Company’s
profile on SEDAR+ (www.sedarplus.ca).
Second Quarter 2024 Highlights:
• Achieved zero lost time injuries and no reportable environmental incidents, demonstrating
our commitment to a safe and sustainable operation.
• The Company reported a record consolidated production of 29,888 gold equivalent
ounces (“AuEq oz”), or its equivalent of 2.5 million silver equivalent ounces (“AgEq oz”),
approximately a 40% increase from Q1 20241.
• Golden Queen produced 16,986 AuEq oz, a 48% increase compared to Q1 2024, reflecting a
strong recovery from the December 2023 fire and improved operations post-acquisition.
• San Bartolomé produced 1.1 million AgEq oz, a 30% increase from Q1 2024, driven by a
27% rise in purchased ore.
• Subsequent to the end of the quarter, the new Fine Minerals Processing Facility (“FDF”) was
commissioned on July 23, 2024, now operating at 1,300 tonnes per day with planned ramp up
to 1,500 tonnes per day by the end of Q3 2024, enhancing overall performance and
sustainability.
• The Company recorded consolidated revenue of $69.8 million, with an average realized gold
price of $2,305/oz and silver price of $27.81/oz 2. This marks a 62% increase, or $26.7 million,
compared to Q1 2024, driven by increased production at Golden Queen and San Bartolomé and
higher average realized gold and silver prices. Golden Queen’s operating cash cost (“OCC”) and
all-in sustaining cost (“ AISC”) per ounce of gold sold for the quarter were $1,350 and $1,752,
respectively.1
1. Silver equivalent production and silver equivalent sales include gold production and sales, respectively. Equivalent ounces are calculated using the
Company’s average realized gold and silver prices during the referenced period. Gold equivalent production and gold equivalent sales include silver production
and sales, respectively. Equivalent ounces are calculated using the Company’s average realized gold and silver prices during the referenced period. Refer to the
“Non-GAAP Financial Measures, Ratios and Supplementary Financial Measures” section below for further detail.
2. OCC, AISC and average realized prices are measures of financial performance with no prescribed definition under IFRS and may not be comparable to similar
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• San Bartolomé’s cash gross operating margin (“CGOM”) and Gross Margin Ratio (“GMR”) were
$5.15 and 24.45% respectively3.
• Higher gross profit – Sustainable increased production and higher average realized prices for
gold and silver led to a gross profit of $14.5 million, up from $3.2 million in Q1 2024.
• Net income (after tax) totaled $9.4 million compared to a net loss of $0.1 million in Q1 2024.
• Strong liquid assets maintained to support ongoing strategic growth, totaling $87.0 million
as of June 30, 2024.
• Share buyback continued. The Company repurchased and cancelled 2,298,000 of its common
shares at an average cost of C$0.94 per share for a total cost of $1.6 million (C$2.1 million)
through its normal course issuer bid ("NCIB") program.
• Strengthened management team with the addition of Sylvain Lessard joining the Company as
President and General Manager at Golden Queen Mine.
Alberto Morales, Executive Chairman and CEO stated “ Our second-quarter results highlight the
significant progress and growth following our acquisition of Golden Queen. We have more than doubled
our size compared to last year’s production and revenue. Compared to Q1 2024, total production
increased by approximately 40% to 29,888 gold equivalent ounces, and consolidated revenue rose by
62% to $69.8 million. These achievements underscore our successful integration of Golden Queen and
the improved performance at San Bartolomé. Our focus remains on delivering value to our shareholders
and pursuing additional growth opportunities as we advance to become a mid-tier producer.
During the quarter, we also advanced our FDF project, completing all concrete, structural steel, and
mechanical work, while effectively managing costs , $5.5 million incurred against a $6.7 million budget.
The commissioning of our Fine Minerals Processing Plant on July 23, 2024, was a key milestone, now
operating at 1,300 tonnes per day with plans to reach 1,500 tonnes by the end of Q3.
Golden Queen’s 48% production increase and San Bartolomé’s 30% rise in silver equivalent ounces
highlight the success of our strategic initiatives. These advances boosted our gross profit to $14.5 million
and net income to $9.4 million, marking a strong turnaround.”
Mr. Morales continued, “Looking ahead, our strong financial position and operating milestones reaffirms
our overall consolidated guidance for 2024. The FDF deposit, with its substantial resource base, aligns
with our sustainability goals, contributing to improved silver recovery and reduced environmental impact.
Our commitment to safety and environmental stewardship remains strong, evidenced by zero lost time
injuries and no reportable environmental incidents this quarter.”
financial measures disclosed by other issuers. Refer to the “Non -GAAP Financial Measures, Ratios and Supplementary Financial Measures” section below for
further detail, including a reconciliation of these metrics to the Financial Statements.
3. Cash gross operating margin (“CGOM”) per equivalent ounce sold is calculated by subtracting the average cash cost of sale (Co sts of sales, excluding
depreciation depletion and amortization), allocated corporate administration costs and business unit general and administrati on cost per equivalent ounces sold
from the average selling price per equivalent ounces. It is a measure of financial per formance with no prescribed definition under IFRS. Refer to “Non -GAAP
Financial Measures, Ratios and Supplementary Financial Measures” section below for further detail, including a reconciliation of these metrics to the Financial
Statements. Gross margin ratio (“GMR”) is calculated by subtracting the cost of sale, excluding depreciation depletion and amortization, as reported in the income
statements from the revenue from sales of equivalent ounces divided by revenue from sales of equivalent ounces. It is a measure of financial performance with no
prescribed definition under IFRS. Refer to the “Non-GAAP Financial Measures, Ratios and Supplementary Financial Measures” section below for further detail,
including a reconciliation of these metrics to the Financial Statements.
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Summary of Financial and Operating Results
(In thousands except for net income per
share and oz) Q2 2024 Q2 2023 Change YTD 2024 YTD 2023 Change
Financial Performance
Revenue $ 69,779 $ 15,284 $ 357% 112,849 $ 38,329 194%
Cost of sales 47,847 11,771 306% 85,126 32,988 158%
Depreciation and depletion 7,399 1,065 595% 10,029 2,519 298%
Gross profit 14,533 2,488 494% 17,694 2,822 527%
Net income (after tax) 9,385 169 5,453% 9,309 388 2,299%
Net income per share
-Basic 0.06 0.00 - 0.06 0.00 -
-Diluted 0.06 0.00 - 0.06 0.00 -
Net cash provided from (used in) operating
activities 13,006 (5,293) - 8,307 (9,616) -
Free cash flow4 7,788 (5,588) - (303) (10,474) -
EBITDA4 24,498 3,657 570% 28,099 5,173 443%
Adjusted EBITDA4 21,732 4,928 341% 24,671 5,401 357%
Capital expenditures (5,218) (295) (1,669%) (8,610) (858) (903%)
Ending cash and cash equivalents 47,049 70,427 (33%) 47,049 70,427 (33%)
Marketable securities and investments 39,911 4,687 752% 39,911 4,687 752%
Total cash and short-term investments 86,960 75,114 16% 86,960 75,114 16%
(In thousands except for metal price per oz) Q2 2024 Q2 2023 Change YTD 2024 YTD 2023( Change
Operating highlights
Production
Golden Queen
Silver (koz) 157 - - 265 - -
Gold (oz) 15,035 - - 25,294 - -
Total AuEq ounces produced (oz) 16,986 - - 28,476 - -
San Bartolomé
Silver (koz) 1,051 1,189 (12%) 1,863 2,167 (14%)
Gold (oz) 274 396 (31%) 448 630 (29%)
Total AgEq ounces produced (koz) 1,074 1,221 (12%) 1,901 2,218 (14%)
Consolidated
Golden Queen AgEq oz (koz) 1,403 - 2,417 -
San Bartolomé AgEq oz (koz) 1,074 1,221 (12%) 1,901 2,218 (14%)
Total Consolidated AgEq ounces produced
(koz) 2,477 1,221 103% 4,319 2,218 95%
Sales
Golden Queen
Silver (koz) 153 - - 261 - -
Gold (oz) 15,441 - - 25,563 - -
Total AuEq oz sold (oz) 17,348 - - 28,691 - -
San Bartolomé
Silver (koz) 1,057 620 71% 1,868 1,602 17%
Gold (oz) 238 - 100% 408 215 90%
Total AgEq oz sold (koz) 1,076 620 74% 1,902 1,620 17%
Consolidated ounces sold
Golden Queen AgEq oz (koz) 1,433 - 2,436 -
San Bartolomé AgEq oz (koz) 1,076 620 74% 1,902 1,620 17%
Total Consolidated AgEq oz sold (koz) 2,509 620 305% 4,339 1,620 168%
Average realized silver price ($/oz) $ 27.81 $ 24.65 13% 26.01 $ 23.67 10%
Average market silver price ($/oz) $ 28.79 $ 24.15 19% 26.08 $ 23.33 12%
Average realized gold price ($/oz) $ 2,305 $ - $ 100% 2,213 $ 1,930 15%
Average market gold price ($/oz) $ 2,337 $ 1,977 $ 18% 2,203 $ 1,932 14%
4. Free cash flow, EBITDA and Adjusted EBITDA are measures of financial performance with no prescribed definition under IFRS. Refer to the “Non-GAAP
Financial Measures, Ratios and Supplementary Financial Measures” section below for further detail, including a reconciliation of these metrics to the Financial
Statements.
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2024 Outlook and Guidance
Production guidance
The Company is maintaining the 2024 annual gold and silver equivalent production guidance for Golden
Queen and San Bartolomé.
2024 AuEq oz Guidance5 +/-
5%
2024 AgEq oz Guidance5 +/-
5%
Golden Queen (koz) 60 5,429
San Bartolomé (koz) 55 5,000
Consolidated (koz) 115 10,429
Quarter-to-quarter gold production in 2024 is expected to fluctuate during the year, with production
continuing to be weighted towards the second half of the year.
Cost guidance
The Company is maintaining the 2024 cost guidance for Golden Queen and San Bartolomé as shown
below:
In line with 2024 guidance, capital investment is expected to total $24.0 million (+/-5%), largely due to
the $9.5 million included in the growth capital for the procurement of six new 785-8 haul trucks, as part
of the Company’s strategic mobile fleet repl acement and mine optimization. These trucks will be
financed through an equipment finance 5-year facility. Included in the sustaining capital at Golden
Queen is the capitalization of the major overhaul maintenance/rebuild of equipment costs of $8.3 million.
As of June 30, 2024, two new trucks out of the planned additional six have been commissioned.
Capital expenditures guidance
In $’000 2024 Guidance +/- 5%
Sustaining capital
Golden Queen $ 10,300
San Bartolomé 3,400
Total sustaining capital $ 13,700
Growth capital
Golden Queen $ 9,500
San Bartolomé 840
5. Assuming gold equivalent ounces were calculated on a consolidated basis for the Company, the expected guidance of 10.4 million silver
equivalent ounces would equate to approximately 115,000 gold AuEq ounces. AuEq production and AuEq sales both include silv er
production and sales. Equivalent ounces are calculated using the Company’s average realized gold and silver prices during the
referenced period. For 2024 guidance commodity price assumptions supporting this estimate are $21 per ounce of silver and $1, 900 per
ounce of gold.
2024 Guidance +/- 5%
Golden Queen
OCC per gold ounce sold, on a by-product credit basis2 $ 1,500
AISC per gold ounce sold, on a by-product credit basis $ 1,750
San Bartolomé
CGOM $ 3.88
GMR 19.5%
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Total growth capital $ 10,340
Total capital
Golden Queen $ 19,800
San Bartolomé 4,240
Total capital expenditures $ 24,040
Q2 2024 Conference Call and Webcast
• Wednesday, August 14, at 9:00 AM ET
• Participants may listen to the webcast by registering on our website at www.andeanpm.com or
via the following link https://www.gowebcasting.com/13407
• Participants may also listen to the conference call by calling North American toll free 1-844-763-
8274, or 1-647-484-8814 outside the U.S. or Canada
• An archived reply of the webcast will be available for 90 days at:
https://www.gowebcasting.com/13407 or the Company website at www.andeanpm.com.
About Andean Precious Metals
Andean is a growth-focused precious metals producer that owns and operates the San Bartolomé
project located in the department of Potosí, Bolivia. San Bartolomé has been operating continuously
since 2008, producing an average of 5 million oz of silver equivalent per year. The Company is seeking
accretive growth opportunities in Bolivia and the wider Americas. Andean is committed to fostering safe,
sustainable, and responsible operations.
Qualified Person Statement
The scientific and technical content disclosed in this news release was reviewed and approved 8 by
Donald J. Birak, Independent Consulting Geologist to the Company, a Qualified Person as defined by
National Instrument 43-101 – Standards for Disclosure for Mineral Projects, Registered Member, Society
for Mining, Metallurgy and Exploration (SME), Fellow, Australasian Institute of Mining and Metallurgy
(AusIMM). Mr. Birak has visited Manquiri’s various sites frequently, most recently in January 2024.
For more information, please contact:
Amanda Mallough
Director, Investor Relations
T: +1 647 463 7808
Neither the TSX Venture Exchange, Inc. nor its Regulation Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward-Looking Statements
Certain statements and information in this release constitute “forward-looking statements” within the
meaning of applicable U.S. securities laws and “forward-looking information” within the meaning of
applicable Canadian securities laws, which we refer to collectively as “forward-looking statements”.
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Forward-looking statements are statements and information regarding possible events, conditions or
results of operations that are based upon assumptions about future economic conditions and courses
of action. All statements and information other than statements of historical fact may be forward-looking
statements. In some cases, forward-looking statements can be identified by the use of words such as
“seek”, “expect”, “anticipate”, “budget”, “plan”, “estimate”, “continue”, “forecast”, “intend”, “believe”,
“predict”, “potential”, “target”, “may”, “could”, “would”, “might”, “will” and similar words or phrases
(including negative variations) suggesting future outcomes or statements regarding an outlook.
Forward-looking statements in this release include, but are not limited to, statements and information
regarding the Company's production,cost outlook and capital expenditure expectations for 2024. Such
forward-looking statements are based on a number of material factors and assumptions, including, but
not limited to: the Company's ability to carry on exploration and development activities; the Company's
ability to secure and to meet obligations under property and option agreements and other material
agreements; the timely receipt of required approvals and permits; that there is no material adverse
change affecting the Company or its properties; that contracted parties provide goods or services in a
timely manner; that no unusual geological or technical problems occur; that plant and equipment
function as anticipated and that there is no material adverse change in the price of silver, costs
associated with production or recovery. Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause actual results, performance or achievements, or
industry results, to differ materially from those anticipated in such forward-looking statements. The
Company believes the expectations reflected in such forward-looking statements are reasonable, but
no assurance can be given that these expectations will prove to be correct, and you are cautioned not
to place undue reliance on forward-looking statements contained herein.
Some of the risks and other factors which could cause actual results to differ materially from those
expressed in the forward-looking statements contained in this release include, but are not limited to:
risks and uncertainties relating to the interpretati on of drill results, the geology, grade and continuity of
mineral deposits and conclusions of economic evaluations; results of initial feasibility, pre-feasibility and
feasibility studies, and the possibility that future exploration, development or mining results will not be
consistent with the Company’s expectations; risks relating to possible variations in reserves, resources,
grade, planned mining dilution and ore loss, or recovery rates and changes in project parameters as
plans continue to be refined; mining and development risks, including risks related to accidents,
equipment breakdowns, labour disputes (including work stoppages and strikes) or other unanticipated
difficulties with or interruptions in exploration and development; the potential for delays in exploration or
development activities or the completion of feasibility studies; risks related to the inherent uncertainty of
production and cost estimates and the potential for unexpected costs and expenses; risks related to
commodity price and foreign exchange rate fluctuations; the uncertainty of profitability based upon the
cyclical nature of the industry in which the Company operates; risks related to failure to obtain adequate
financing on a timely basis and on acceptable terms or delays in obtaining governmental or local
community approvals or in the completion of development or construction activities; risks related to
environmental regulation and liability; political and regulatory risks associated with mining and
exploration; risks related to the uncertain global economic environment; and other factors contained in
the section entitled “Risk Factors” in the Company’s MD&A dated June 30, 2024.
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Although the Company has attempted to identify important factors that could cause actual results or
events to differ materially from those described in the forward-looking statements, you are cautioned
that this list is not exhaustive and there may be other factors that the Company has not identified.
Furthermore, the Company undertakes no obligation to update or revise any forward-looking statements
included in this release if these beliefs, estimates and opinions or other circumstances should change,
except as otherwise required by applicable law.
Non-GAAP Financial Measures, Ratios and Supplementary Financial Measures
This news release “specified financial measures” within the meaning of National Instrument 52- 112 –
Non-GAAP and Other Financial Measures Disclosure, specifically the non-GAAP financial measures,
non-GAAP ratios and supplementary financial measures described below. Management believes that
the use of these measures assists analysts, investors and other stakeholders of the Company in
understanding the costs associated with producing silver and gold, understanding the economics of
silver and gold mining, assessing operating performance, the Company’s ability to generate free cash
flow from current operations and on an overall Company basis, and for planning and forecasting of future
periods.
The specified financial measures used in this news release do not have any standardized meaning
prescribed by IFRS and may not be comparable to similar measures presented by other issuers, even
as compared to other issuers who may be applying the World Gold Council guidelines. Accordingly,
these measures are 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.
The following is a description of the non-GAAP financial measures, non-GAAP ratios and supplementary
financial measures used in this news release:
(i) OCC includes total production cash costs incurred at the Company’s mining operations, which
form the basis of the Company’s cash costs, less by-product revenue.
(ii) AISC on a by-product basis per ounce is a non-GAAP ratio calculated as AISC on a by-product
basis divided by ounces of gold sold. AISC on a by -product basis is a non-GAAP financial
measure calculated as the aggregate of production costs as recorded in the consolidated
statements of income (loss), refining and transport costs, cash component of sustaining capital
expenditures, lease payments related to sustaining assets, corporate general and administrative
expenses and accretion expenses. When calculating A ISC on a by -product basis, all revenue
received from the sale silver at Golden Queen are treated as a reduction of costs incurred. The
Company believes that AISC represents the total costs of producing gold from current operations
and provides the Company and other stakeholders of the Company with additional information
relating to the Company’s operational performance and ability to generate cash flow.
(iii) AIC represents AISC plus growth capital and non-sustaining exploration and evaluation costs.
Non-sustaining exploration and evaluation costs represent costs associated with the Company’s
exploration portfolio. Certain other cash expenditures including tax payments, debt payments,
dividends and financing costs are also not included in the calculation of AIC. The Company
reports these measures on a per gold ounce sold basis.
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(iv) CGOM per equivalent ounce sold is calculated by subtracting the average cash cost of sale (cost
of sales, allocated corporate administrative costs and business unit general and administration
cost) per equivalent ounce sold from the average selling price per equivalent ounce. It is a
measure of financial performance with no prescribed definition under IFRS and may not be
comparable to similar financial measures disclosed by other issuers.
(v) GMR is calculated by subtracting the cost of sale as reported in the income statement from the
revenue of equivalent ounces divided by revenue from sales of equivalent ounces. GMR is a
measure of financial performance with no prescribed definition under IFRS and may not be
comparable to similar financial measures disclosed by other issuers.
(vi) EBITDA is defined as earnings before interest, tax, depreciation and amortization. Adjusted
EBITDA is a non-GAAP financial measure calculated by adjusting net income (loss) as recorded
in the condensed interim consolidated statements of income (loss) for items not associated with
ongoing operations. The Company believes that this generally accepted industry measure allows
the evaluation of the results of income-generating capabilities and is useful in making
comparisons between periods. This measure adjusts for the impact of items not associated with
ongoing operations. A reconciliation of adjusted net income (loss) to the nearest IFRS measures
is set out below. Management uses this measure to monitor and plan for the operating
performance of the Company in conjunction with other data prepared in accordance with IFRS.
(vii) Free cash flow is a non -GAAP financial measure calculated as cash provided by operating
activities from continuing operations less property, plant and equipment additions. A
reconciliation of free cash flow to the nearest IFRS measures is set out below. Management
uses this measure to monitor the amount of cash available to reinvest in the Company and
allocate for shareholder returns.
(viii) Average realized price is a supplementary financial measure calculated by dividing the
different components of precious metal sales by the number of ounces sold. Management uses
this measure to monitor its sales of precious metal ounces against the average market gold
price.
OCC
The following table provides a reconciliation of the OCC per ounce sold on a by -product basis to the
Financial Statements:
Golden Queen Three months ended June 30, Six months ended June 30,
(In thousands except for ounces and per ounce
measures) 2024 2023 2024 2023
Costs of sales, as reported $ 25,239 $ - $ 44,236 $ -
Total OCC before by-product credits 25,239 - 44,236 -
Less: by-product silver credits (4,390) - (6,924) -
Total OCC 20,849 $ - $ 37,312 $ -
Divided by Au ounces sold 15,441 - 25,563 -
OCC per Au ounce sold, on a by-product
basis
1,350 $ - $ 1,460 $ -