IMPACT Silver Announces Q2 2019 Financial & Production Results
IMPACT Silver Announces Q2 2019 Financial &
Production Results
Trading Symbol: "IPT: TSX.V"
VANCOUVER
,
Aug. 14, 2019
/CNW/ - IMPACT Silver Corp. ("IMPACT" or the "Company")
announces its financial results for the six months ending
June 30, 2019
.
The Company reported revenues of
$2.8 million
, a decrease of 11% from same period in 2018, with
weak metal prices and lower production offset by improved grades. Net loss was
$2.8 million
which
includes a one-time write-down of
$1.7 million
of exploration and evaluation assets as the Company
reduced its land package size to save on biannual concession taxes. IMPACT continues to have no
long-term debt and a strong balance sheet.
Fred Davidson
, President & CEO of IMPACT stated, "Nearly seven years into this mineral downturn,
silver had a challenging first half of 2019. Continuing the cost reduction efforts implemented from
September 2018
, operating expenses in Q2 2019 dropped to just
$3.0 million
from
$3.8 million
, a
sharp 20% decrease despite only a 10% drop in silver ounces sold. The decrease in land package
size, keeping the high potential packages with the possibility to quickly re-acquire, showcases the
flexibility and nimbleness of our operations. Being the largest employer in
Zacualpan
for the last 14
years, IMPACT has built up trust and rapport with mining government contacts and local staff.
IMPACT is well positioned as precious metal prices start to recover. We aim to continue to mine
profitable ounces and manage our production costs while selectively exploring for high potential
targets to showcase the high success rate of our exploration efforts. With higher precious metal
prices due to geopolitical turmoil and uncertainty in late 2019, our investors and the Company can
expect higher revenue per ounce of silver to flow right to profit."
Financial Overview
Revenue for Q2 2019 was
$2.8 million
compared to
$3.1 million
in Q2 2018, an 11% drop year
over year with improvement in silver head grade offset by lower silver prices and fewer ounces
produced.
Operating expenses for Q2 2019 were
$3.0 million
, a substantial decrease from Q2 2018 at
$3.8 million
.
Mine operating loss before amortization and depletion improved to
$0.2 million
in Q2 2019
compared to
$0.7 million
in the same period of 2018 as cost reduction and improving head
grade at the mill continue to help combat lower silver prices.
Net loss for the quarter was
$2.8 million
, largely due to
$2.1 million
of non-cash expenses
including a reduction of mineral concession holdings from 357 km
2
to 167 km
2
, resulting in a
one-time write-down of
$1.7 million
. All active mines, facilities, and most of the 5,000 identified
historic mine workings and high potential prospect targets have been retained.
The Company's cash position at
June 30, 2019
was
$0.8 million
.
Subsequent to the quarter, the Company closed a non-brokered private placement for
aggregate gross proceeds of
$4.95 million
.
The Company has no long-term debt.
Production Overview
Silver production decreased to 145,658 ounces in Q2 2019 from 194,223 ounces in Q2 2018
due to
fewer tonnes processed.
Average mill feed grade for silver was 160 grams per tonne (g/t) in Q2 2019, a 10% increase
from 146 g/t in Q2 2018.
Throughput at the mill in Q2 2019 was 33,616 tonnes, a decrease from 48,009 tonnes in Q2
2018 due to production refocusing on higher grade ore and breakeven ounces.
Silver sales decreased 10% in the second quarter of 2019 to 156,242 ounces compared to 2018
same period figures of 172,701 as lower silver prices forced the Company to prioritize breakeven
ounces. A challenging quarter commenced for metals with trade wars, geopolitical uncertainties,
and investor's reversion to safety in US dollars and treasuries.
Revenue per tonne sold for Q2 2019 was
$76.74
from
$66.46
in Q2 2018, a substantial 15%
increase as efforts to increase grade and breakeven ounces is showing dividends. Cost continues to
be a focal point with direct cost per tonne rising slightly in Q2 2019 to
$82.82
from
$77.91
with a
moderate cost per tonne increase expected while production levels are reduced.
In June, IMPACT announced a successful sampling program by its Exploration team at Manto
America. Manto America hosts the strongest gold soil geochemical anomaly on IMPACT's claims
and extends over an area 3.5 km east-west and
900 m
north-south. It is located 10 km south of the
operating Guadalupe processing plant and 7 km north-northeast of the Capire processing plant. The
area is being mapped and sampled by IMPACT crews and to date 33 rock samples returned
greater than 2.0 g/t Au from historic artisanal underground workings and surface with values up to
19.5 g/t gold over a true width of
1.2 m
. With the proceeds of the recent financings, IMPACT plans
to continue working this area with a more systematic exploration effort.
IMPACT has also engaged an engineering group to review the possibility of Dense Media
Separation (DMS) in an effort to enhance economics of mining at the Capire open pit and 200
tonnes per day (TPD) production centre. The Capire plant has been on care and maintenance since
July 2013
and the latest NI 43-101 resource figures can be found in IMPACT's
March 2016
news release
.
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 of the six months ended
June 30, 2019
will be available on the Company website on
August 15, 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 167 km
2
in central
Mexico
with excellent infrastructure and labor force. Over the past fourteen years IMPACT has produced
over 9.4 million ounces of silver, generating revenues of 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 currently rated at 200 tpd but is expandable. It is adjacent to an open pit silver mine with a
National Instrument 43-101 ("NI 43-101") compliant resource of over 4.5 million oz silver, 48 million
lbs zinc and 21 million lbs lead (see IMPACT news release dated
January 18, 2016
) that is awaiting
higher silver prices to be restarted. Given the challenging markets the last few years, IMPACT has
focused its exploration efforts on high probability gold and silver targets, with potentially rapid
timelines to production and proximity to the Guadalupe processing plant. Following a decade of
exploration successes leading to production cash flows, IMPACT has shown the
Zacualpan
District
to be endowed with many high grade epithermal silver-gold zones. With markets more receptive to
early exploration results, in 2019 IMPACT continues to add emphasis to exploration work to further
realize value on this prolific land package.
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.
View original content:
http://www.newswire.ca/en/releases/archive/August2019/14/c9237.html
%SEDAR: 00001640E
For further information:
Jerry Huang, CFO & Investor Relations, (604) 681 0172 or
CO: IMPACT Silver Corp.
CNW 18:26e 14-AUG-19