IMPACT Silver Announces Q1 2019 Financial and Production Results
IMPACT Silver Announces Q1 2019 Financial and Production Results
Trading Symbol: "IPT: TSX.V"
VANCOUVER, May 27, 2019 /CNW/ - IMPACT Silver Corp. ("IMPACT" or the
"Company") announces its financial and operating results for the quarter ending March
31, 2019.
The Company reported $3.0 million in revenue for the first quarter of 2019 compared to
Q1 2018 at $3.9 million with improved grades helping to offset lower tonnage and silver
prices. Mine operating earnings before amortization and depletion were breakeven for
the first time since Q1 2018 as cost reductions and grade improvements are having a
positive impact.
Fred Davidson, President & CEO of IMPACT, stated, "In Q1 2019, silver prices
continued to be challenging with prices below $16 USD/ounce. In reaction to these
persistent low metal prices, IMPACT has reduced tonnage and focused on higher
grades which resulted in a 16% reduction in cost and a 23% decline in revenue during
the quarter. Going forward given the current silver price environment, we aim to break
even on existing production levels while metal prices remain depressed and explore
selective high-grade targets which IMPACT may fast track to higher grade production."
IMPACT is increasingly shifting production to the Guadalupe Silver Mine located
adjacent to the Guadalupe mill which saves significant hauling costs. Historic production
from the Guadalupe Mine was first recorded in 1529 and more recently between 1967-
1982 produced an estimated 9,000,000 ounces of silver. Benefiting from better silver
grades, proximity to the mill, and existing low-cost shaft infrastructure (which was
updated in 2019), in Q1 2019 the Guadalupe mine accounted for 27% of the total
production feed and management expects this to continue to increase.
Production Overview
• Silver production decreased to 163,575 ounces in Q1 2019 from 203,199 ounces
in Q1 2018 due to planned lower tonnages produced.
• Average mill feed grade for silver in the quarter increased to 167 g/t silver in Q1
2019, a 4% increase from Q1 2018 at 160 g/t silver.
• Throughput at the mill decreased 23% to 35,788 tonnes milled in Q1 2019 from
46,602 in Q1 2018.
Financial Overview
• Revenue for Q1 2019 was comparable to Q4 2018 at $3.0 million. However,
revenue per tonne increased to $84.98 from Q4 2018 ($79.55) as the Company
focused on improving head grade at the mill to combat lower silver prices.
• Mine operating earnings before amortization and depletion were breakeven
($0.0) compared to $0.3 million in Q1 2018 as cost reductions and grade
improvements started materializing.
• Mine operating loss was $0.4 million for Q1 2019 compared to $0.1 million in Q1
2018.
• Net loss for quarter was $0.9 million which includes $0.1 million of foreign
exchange loss and non-cash expenses of $0.4 million for amortization, depletion,
and deferred income taxes.
• The Company had cash of $0.4 million and trade and other receivables of $1.6
million at March 31, 2019.
• The Company has no long-term debt.
Silver prices for the first quarter of 2019 were range bound to $15 to $16 USD per
ounce though some experts have forecasted higher prices on upcoming geopolitical
uncertainties in the world, the historic high gold to silver ratio, and 2% decrease in
worldwide silver production while investment demand has surged 20% year over year.
Cost control remains a high priority for IMPACT. In addition to increasing efficiency and
grade at operations, cost reduction initiatives are well under way to ensure IMPACT can
weather the markets. Direct cost per tonne at the mill was $82.47 in Q1 2019 compared
to Q4 2018 of $91.50, a 10% reduction and showing progress on the Company's
continued push on cost reductions. On the positive side, revenue per tonne sold for Q4
increased to $84.98 versus $79.55 in Q4 2018, a 7% increase from the previous
quarter. IMPACT continues to focus on cost reductions and maximizing revenue per
ounce sold.
Dense Media Separation Study at Capire
Subsequent to quarter end, IMPACT announced commissioning of an engineering study
to test the viability of Dense Media Separation (DMS) processing at its Capire
Production Centre. DMS is a low-cost method of pre-concentrating minerals to increase
the grade of mineral feed into the processing plant and improve processing economics.
Results of the DMS test are pending.
New Concentrate Sales Partnership
In late Q1 2019, IMPACT Silver entered into a new concentrate sales and refining
partnership with Samsung C&T Corp. The Company believes the pricing is competitive
with this new contract albeit with longer payment terms.
George Gorzynski, P.Eng., a Qualified Person under the meaning of Canadian National
Instrument 43-101, approved the technical content regarding exploration work in this
news release.
A recorded conference call reviewing the financial and production results for the first
three months ending March 31, 2019 will be available on the Company website on May
27, 2019 at www.impactsilver.com/s/ConferenceCalls.asp.
The information in this news release should be read in conjunction with the Company's
unaudited condensed consolidated interim financial statements and Management's
Discussion and Analysis, available on the Company website
at www.impactsilver.com and on SEDAR at www.sedar.com. All amounts are stated in
Canadian dollars unless otherwise specified.
About IMPACT Silver:
IMPACT Silver Corp. is a successful silver-gold explorer-producer with two processing
plants on adjacent districts within its 100% owned mineral concessions covering 357
km2 in central Mexico with excellent infrastructure and labor force. Over the past twelve
years IMPACT has produced over 9.4 million ounces of silver, generating revenues over
$175 million, with no long-term debt. At the Royal Mines of Zacualpan Silver District
several underground silver mines feed the central Guadalupe processing plant. To the
south, in the Mamatla District the Capire processing pilot plant is an expandable 200 tpd
with a NI-43-101 compliant resource of silver-lead-zinc (see IMPACT news release
dated January 18, 2016 for details) awaiting higher metal prices to be restarted. Given
the challenging markets the last few years, IMPACT has focused its exploration efforts
on gold and silver targets with quick to production profiles and proximity to the
Guadalupe processing plant. Following a successful decade of exploration success to
production cash flows, IMPACT has shown the Zacualpan District to be prolific in
generating high grade epithermal silver-gold production feeds. With markets more
perceptive to exploration results and the requirement for additional production feed,
IMPACT continues to add emphasis to exploration work.
Additional information about IMPACT and its operations can be found on the Company
website at www.IMPACTSilver.com.
On behalf of IMPACT Silver Corp.
"Frederick W. Davidson"
President & CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Forward-Looking and Cautionary Statements
This IMPACT News Release may contain certain "forward-looking" statements and
information relating to IMPACT that is based on the beliefs of IMPACT management, as
well as assumptions made by and information currently available to IMPACT
management. Such statements reflect the current risks, uncertainties and assumptions
related to certain factors including but not limited to, without limitations, exploration and
development risks, expenditure and financing requirements, title matters, operating
hazards, metal prices, political and economic factors, competitive factors, general
economic conditions, relationships with vendors and strategic partners, governmental
regulation and supervision, seasonality, technological change, industry practices, and
one-time events. Should any one or more risks or uncertainties materialize or change,
or should any underlying assumptions prove incorrect, actual results and forward-
looking statements may vary materially from those described herein. IMPACT does not
assume the obligation to update any forward-looking statement.
The Company's decision to place a mine into production, expand a mine, make other
production related decisions or otherwise carry out mining and processing operations, is
largely based on internal non-public Company data and reports based on exploration,
development and mining work by the Company's geologists and engineers. The results
of this work are evident in the discovery and building of multiple mines for the Company
and in the track record of mineral production and financial returns of the Company since
2006. Under NI43-101 the Company is required to disclose that it has not based its
production decisions on NI43-101-compliant mineral resource or reserve estimates,
preliminary economic assessments or feasibility studies, and historically such projects
have increased uncertainty and risk of failure.
SOURCE IMPACT Silver Corp.
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http://www.newswire.ca/en/releases/archive/May2019/27/c4883.html
%SEDAR: 00001640E
For further information: Jerry Huang, CFO & Investor Relations, (604) 681 0172 or
CO: IMPACT Silver Corp.
CNW 09:00e 27-MAY-19