THIRD QUARTER 2022 FINANCIAL RESULTS Wheaton Precious Metals Maintains Strong Cash Operating Margins in the Third Quarter of 2022 “At Wheaton, we focus on building a sustainable company that provides investors with profitable
November 3, 2022 TSX | NYSE | LSE: WPM
Vancouver, British Columbia
Designated News Release
THIRD QUARTER 2022 FINANCIAL RESULTS
Wheaton Precious Metals Maintains
Strong Cash Operating Margins in the Third Quarter of 2022
“At Wheaton, we focus on building a sustainable company that provides investors with profitable,
long-term exposure to precious metals. While inflationary pressures have impacted all sectors of
the economy, especially mining, Wheaton has maintained cash operating margins of ov er 75%
year to date, highlighting the strength of our streaming business model,” said Randy Smallwood,
President and Chief Executive Officer of Wheaton Precious Metals. “Despite some recent
challenges, we are pleased with the improvements we have seen over the third quarter in our
diverse portfolio of high-quality assets, which is forecast to deliver significant organic growth over
the next five years and sustained precious metals production for decades to come. We also are
very optimistic that we can continue to add accretive new streams to the portfolio given the number
of opportunities that we are currently reviewing coupled with one of the strongest balance sheets
in the sector.”
Solid Financial Results and Strong Balance Sheet
• $219 million in revenue and $154 million in operating cash flow in the quarter
• $197 million in net earnings and $94 million in adjusted net earnings1 in the quarter
• A cash balance of $495 million and no debt as at September 30, 2022
• Extended the maturity date of the undrawn US$2 billion revolving credit facility to July 18, 2027
• Declared a quarterly dividend1 of $0.15 per common share
High Quality Asset Base
• Streaming agreements on 21 operating mines and 13 development projects
• 85% of attributable production from assets in the lowest half of their respective cost curves2
• 29 years of mine life based on Proven and Probable Mineral Reserves and potential additional
mine life from mineral resource conversion and exploration3
• Average annual production for the ten-year period ending December 31, 2031, is expected to
be approximately 850,000 GEOs2,4
• Completed the previou sly disclosed termination of the Keno Hill precious metal purchase
agreement (“PMPA”) for $141 million, resulting in an impairment reversal of $10 million and a
gain on disposition of $104 million
• Announced the proposed termination of the Yauliyacu PMPA f or $ 150 million, less the
aggregate value of any deliveries to Wheaton of silver produced in 2022 prior to closing
Leadership in Sustainability
• Top Rankings: #1 out of 119 precious metals companies and Global Top 50 out of over 14,900
multi-sector companies by Sustainalytics, AA rated by MSCI, and Prime rated by ISS
• Commitment to Net-Zero Carbon Emissions by 2050 supported by interim targets covering all
material emissions including Scope 3
• Established a sustainability linked element in connection with the extension of the revolving
credit facility
• Recognized as one of the Best 50 Corporate Citizens in Canada by Corporate Knights
• Recognized by ESG Investing for Best Climate Related Reporting (Mid Cap)
• Supported flood relief to local communities near the Stillwater mine in Montana
• Presenting sponsor of BC Cancer Foundation’s Tour de Cure supporting cancer research
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Operational Overview
(all figures in US dollars unless otherwise
noted) Q3 2022 Q3 2021 Change YTD 2022 YTD 2021 Change
Units produced
Gold ounces 73,508 85,624 (14.2)% 218,004 254,225 (14.2)%
Silver ounces 5,883 6,349 (7.3)% 18,645 19,643 (5.1)%
Palladium ounces 3,229 5,105 (36.7)% 11,616 16,175 (28.2)%
Cobalt pounds 226 370 (39.0)% 596 1,912 (68.8)%
Gold equivalent ounces 2 159,852 183,012 (12.7)% 491,088 570,040 (13.9)%
Units sold
Gold ounces 62,000 67,649 (8.4)% 224,238 232,843 (3.7)%
Silver ounces 5,234 5,487 (4.6)% 16,635 17,744 (6.3)%
Palladium ounces 4,227 5,703 (25.9)% 11,680 14,703 (20.6)%
Cobalt pounds 115 131 (12.2)% 851 658 29.3 %
Gold equivalent ounces 2 138,824 149,862 (7.4)% 475,259 498,635 (4.7)%
Change in PBND and Inventory
Gold equivalent ounces 2 6,620 17,659 11,039 (32,497) 22,375 54,872
Revenue $ 218,836 $ 268,957 (18.6)% $ 829,002 $ 923,468 (10.2)%
Net earnings $ 196,460 $ 134,937 45.6 % $ 503,001 $ 463,063 8.6 %
Per share $ 0.435 $ 0.300 45.0 % $ 1.114 $ 1.029 8.3 %
Adjusted net earnings 1 $ 93,878 $ 137,087 (31.5)% $ 401,168 $ 459,848 (12.8)%
Per share 1 $ 0.208 $ 0.304 (31.6)% $ 0.889 $ 1.022 (13.0)%
Operating cash flows $ 154,497 $ 201,287 (23.2)% $ 571,396 $ 649,856 (12.1)%
Per share 1 $ 0.342 $ 0.447 (23.5)% $ 1.266 $ 1.444 (12.3)%
All amounts in thousands except gold, palladium & gold equivalent ounces, and per share amounts.
Third Quarter Operating Asset Highlights
Salobo: In the third quarter of 2022, Salobo produced 44,200 ounces of attributable gold, a
decrease of approximately 20% relative to the third quarter of 2021, primarily due to lower grades
and recovery. According to Vale S.A.’s (“Vale”), plant performance improved relative to the
second quarter of 2022 despite additional planned and corrective maintenance performed in the
third quarter. Vale plans for maintenance activities to continue in the fourth quarter of 2022 to
further improve plant reliability.
Vale reports that physical completion of the Salobo III mine expansion was 98% at the end of the
third quarter. P rogress in the third quarter included the primary crushing circuit being fully
commissioned, hot commissioning of the conveyor system, and commencement of wet
commissioning of the flotation circuit.
Antamina: In the third quarter of 2022, Antamina produced 1.4 million ounces of attributable
silver, a decrease of approximately 11% relative to the third quarter of 2021, primarily due to lower
grades as per the mine plan.
Peñasquito: In the third quarter of 2022, Peñasquito produced 2.0 million ounces of attributable
silver, a decrease of approximately 7% relative to the third quarter of 2021 with lower recovery
and grades as per the mine plan.
Constancia: In the third quarter of 2022, Constancia produced 0.6 million ounces of attributable
silver and 7,200 ounces of attributable gold, an increase of approximately 8% for silver production
and a decrease of approximately 16% for gold production relative to the third quarter of 2021, with
the increase in silver being primarily due to higher throughput and the decrease in gold production
being primarily due to the mining of lower-grade material resulting from mine sequencing.
Sudbury: In the third quarter of 2022, Vale’s Sudbury mines produced 4,700 ounces of
attributable gold, an increase of approximately 3109% relative to the third quarter of 2021 ,
primarily due to operations at the mine being temporarily suspended due to a labour dispute which
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lasted from June 1, 2021 to August 9, 2021. Vale reports that in the third quarter, the first phase
of the Copper Cliff Complex South Mine Project was opened, including the development of more
than 12km of tunnels to reunite the south and north shafts of the mine, which is expected to nearly
double ore production at the Copper Cliff Mine. The Copper Cliff Mine has historically represented
approximately 20% of attributable production for Wheaton from Sudbury.
Stillwater: In the third quarter of 2022, the Stillwater mines produced 1,800 ounces of attributable
gold and 3,200 ounces of attributable palladium, a decrease of approximately 38% for gold and
37% for palladium relative to the third quarter of 2021. As per Sibanye-Stillwater Limited, regional
floods impacted the Stillwater operations on June 13, 2022, including damage to bridges and the
access road to the Stillwater mine. Operations at the Stillwater mine, which accounts for 60% of
the mined production from the Stillwater operations, were suspended for seven weeks, but
resumed on July 29, 2022. Access to the East Boulder mine and the Columbus metallurgical
facilities remains intact and both facilities continued operating during the flooding events.
San Dimas: In the third quarter of 2022, San Dimas produced 11,800 ounces of attributable gold,
virtually unchanged relative to the third quarter of 2021 , primarily due to lower throughput offset
by higher grades. According to First Majestic Silver Corp., silver and gold grades were higher in
the third quarter compared to the prior quarter due to improvements in dilution control from the
long hole stoping in the Jessica and Regina veins and due to initial production from the Perez vein
commencing in July.
Other Gold: In the third quarter of 2022, total Other Gold attributable production was 3,700
ounces, a decrease of approximately 46% relative to the third quarter of 2021 , primarily due to
the closure of the 777 mine in June 2022.
Other Silver: In the third quarter of 2022, total Other Silver attributable production was 1.9 million
ounces, a decrease of approximately 8% relative to the third quarter of 2021 , primarily due to
lower production at Aljustrel (grades) and Stratoni (placed into care and maintenance).
Voisey’s Bay: In the third quarter of 2022, the Voisey's Bay mine produced 226,000 pounds of
attributable cobalt, a decrease of approximately 39% relative to the third quarter of 2021, primarily
due to mining lower grade material during the ongoing transitional period between the depletion
of the Ovoid open-pit mine and ramp-up to full production of the Voisey’s Bay underground project.
Vale reports that physical completion of the Voisey’s Bay underground mine extension was 78%
at the end of the third quarter. Progress in the third quarter included surface activities being well
advanced with the port fuel tanks installed and Eastern Deeps mine fresh air i nfrastructure
completed, and in the underground, the Reid Brook bulk Material Handling System advancing on
schedule.
Detailed mine-by-mine production and sales figures can be found in the Appendix to this press
release and in Wheaton’s consolidated MD&A in the ‘Results of Operations and Operational
Review’ section.
Third Quarter Development Asset Highlights
Goose Project: Sabina Gold & Silver Corp. (“Sabina”) announced a formal construction decision
for the Goose Project. Sabina noted that the project will be in a position to commence full
construction in early 2023 with first production expected in 2025.
Blackwater Project : Artemis Gold Inc. (“ Artemis”) announced the commencement of site
preparation work at the plant site including site clearing, bulk earthworks and sediment/erosion
control. Artemis believes the Blackwater plant site will start major construction works in the first
quarter of 2023.
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Marathon Project: Generation Mining Limited (“Gen Mining”) delivered the environmental
assessment report for the Marathon Project to federal and provincial ministers and announced
the purchasing of an unused, surplus SAG mill and ball mill. Gen Mining anticipates starting
construction late in the first quarter of 2023.
Curipamba Project: Adventus Mining Corporation (“Adventus”) announced an Investment
Protection Agreement commitment declaration by the Government of Ecuador indicating a
significant milestone in the development of the Curipamba Project. Adventus plans for a formal
construction commencement in the second quarter of 2023.
Portfolio Optimization
Keno Hill: On September 7, 2022, Hecla Mining Company (“Hecla”) completed the previously
announced acquisition of all the outstanding common shares of Alexco. In connection with this
acquisition, the Company entered into an agreement with Hecla to terminate the Keno Hill PMPA
effective September 7, 2022, in exchange for 34,800,989 common shares of Hecla valued at $141
million (the “Hecla shares” 5), resulting in a n impairment reversal of the Keno Hill PMPA in the
amount of $10 million and a gain on disposal of $104 million.
Yauliyacu: On August 18, 2022, the Company announced that it had entered into an agreement
with Glencore plc ("Glencore") to terminate its silver stream on the Yauliyacu Mine in Peru for a
cash payment of $150 million, less the aggregate value of any deliveries to Wh eaton, prior to
closing, of silver produced subsequent to December 31, 2021. Wheaton has agreed to terminate
the stream in order to help facilitate the sale by Glencore of the Yauliyacu Mine. As at September
30, 2022, the net termination payment is estimated to be approximately $136 million. The closing
of the transaction is contingent on Glencore divesting the Yauliyacu mine by December 31, 2022
and certain other customary conditions. Glencore retains the option to terminate the silver stream
even if it does not divest the Yauliyacu mine by December 31, 2022.
Financial Review
Revenues
Revenue was $219 million in the third quarter of 2022 representing an 19% decrease from the
third quarter of 2021 due primarily to a 12% decrease in the average realized gol d equivalent²
price; and a 7% decrease in the number of GEOs² sold.
Revenue was $829 million in the nine months ended September 30, 2022, representing a 10%
decrease from the comparable period of the previous year due primarily to a 5% decrease in the
number of gold equivalent² ounces sold; and a 6% decrease in the average realized gold
equivalent² price.
Cash Costs and Margin
Average cash costs¹ in the third quarter of 2022 were $439 per GEO² as compared to $417 in the
third quarter of 2021. This res ulted in a cash operating margin¹ of $1,137 per GEO² sold, a
decrease of 17% as compared with the third quarter of 2021.
Average cash costs¹ for the nine months ended September 30, 2022 were $433 per GEO² as
compared to $441 in the comparable period of the previous year. This resulted in a cash operating
margin¹ of $1,311 per GEO² sold, a 7% decrease from the comparable period of the previous
year.
Balance Sheet (at September 30, 2022)
• Approximately $495 million of cash on hand.
• During the third quarter of 2022, the Company made upfront cash payments totaling $47
million relative to PMPA’s.
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• The Company extended its existing undrawn $2 billion revolving term loan with its maturity
date now July 18, 2027 . As part of the extension, Wheaton added a su stainability-linked
element which may impact the interest rate paid on drawn amounts and standby fees.
• The Company is well positioned to fund all outstanding commitments and known
contingencies as well as providing flexibility to acquire additional accretive mineral stream
interests.
Sustainability
Community Investment Program:
• In the third quarter, Wheaton Precious Metals International Ltd. (“Wheaton International”)
in partnership with Sibanye-Stillwater Limited, donated funds to support flood relief in the
community of Nye, which is the closest town to the Stillwater mine in Montana. Funds were
used to clean up debris and support other flood-related recovery efforts and to support
families in financial need whose houses were damaged.
• In the third quarter, new reading rooms were opened in the state of Maranhāo, Brazil, as
part of the Routes and Literary Network project that is maintained by the Vale Foundation
in partnership with Wheaton International and the Associação Cidade Escola Aprendiz.
The new reading rooms benefit 1,800 students from three different schools.
• On August 27th, the Tour de Cure, presented by Wheaton Precious Metals, raised CA$6.3
million for the BC Cancer Foundation. The event is B.C.’s largest cycling fundraiser
attracting over 1,100 participants. Since 2014, Wheaton has donated over CA$3.2 million
towards crucial advancements in cancer research and care. In addition, the Silver Bullets,
Wheaton’s cycling team comprised of employees, friends and family have collectively
raised over CA$2 million through the Tour de Cure.
Sustainability-Linked Revolving Credit Facility: Wheaton has added a sustainability -linked
element in connection with the extension to its existing undrawn US$2 billion revolving credit
facility, underscoring Wheaton’s commitment to sustainability initiatives. Under the renewed
revolving credit facility, the interest rate paid on drawn amounts and standby fees will be adjusted
based upon Wheaton’s performance in three sustainability -related areas including climate
change, diversity and overall sustainability performance.
Webcast and Conference Call Details
A conference call and webcast will be held on Friday, November 4, 2022 starting at 8:00am PT /
11:00 am ET to discuss these results. To participate in the live call please use one of the following
methods:
Dial toll free from Canada or the US: 1-888-664-6383
Dial from outside Canada or the US: 1-416-764-8650
Pass code: 30587457
Live webcast: Webcast URL
The accompanying slideshow will also be available in PDF format on the ‘Events’ page of the
Wheaton Precious Metals website before the conference call.
The conference call will be recorded and available until November 11, 2022 at 11:59 pm ET. The
webcast will be available for one year. You can listen to an archive of the call by one of the
following methods:
Dial toll free from Canada or the US: 1-888-390-0541
Dial from outside Canada or the US: 1-416-764-8677
Pass code: 587457 #
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Archived webcast: Webcast URL
This earnings release should be read in conjunction with Wheaton Precious Metals’ MD&A and
Financial Statements, which are available on the Company’s website at www.wheatonpm.com
and have been posted on SEDAR at www.sedar.com.
Mr. Wes Carson, P.Eng., Vice President, Mining Operations, Neil Burns, P.Geo., Vice President,
Technical Services for Wheaton Precious Metals and Ryan Ulansky, P.Eng., Vice President,
Engineering, are a “qualified person” as such term is defined under National Instrument 43-101,
and have reviewed and approved the technical information disclosed in this news release
(specifically Mr. Carson has reviewed production figures , Mr. Burns has reviewed mineral
resource estimates and Mr. Ulansky has reviewed the mineral reserve estimates).
Wheaton Precious Metals believes that there are no significant differences between its
corporate governance practices and those required to be followed by United States domestic
issuers under the NYSE listing standards. This confirmation is located on the Wheaton Precious
Metals website at http://www.wheatonpm.com/Company/corporate-governance/default.aspx.
About Wheaton Precious Metals Corp. and Outlook
Wheaton is the world’s premier precious metals streaming company with the highest -quality
portfolio of long-life, low-cost assets. Its business model offers investors commodity price leverage
and exploration upside but with a much lower risk profile than a traditional mining company.
Wheaton delivers amongst the highest cash operating margins in the mining industry, allowing it
to pay a competitive dividend and continue to grow through accretive acquisitions. As a result,
Wheaton has consistently outperformed gold and silver, as well as other mining investments.
Wheaton is committed to strong ESG practices and giving back to the communities where
Wheaton and its mining partners operate. Wheaton creates sustainable value through streaming
for all of its stakeholders.
Wheaton’s estimated attributable production for 2022 is forecast to be 300,000 to 320,000
ounces of gold, 22.5 to 24.0 million ounces of silver, and 35,000 to 40,000 gold equivalent
ounces2 (“GEOs”), resulting in production of approximately 640,000 to 680,000 GEOs2. As a
result of the proposed termination of the Yauliyacu PMPA, the Company now expects average
annual production for the five-year period ending December 31, 2026, to be approximately
800,000 GEOs2,4 (from 820,000 GEOs2,4 previously) and for the ten-year period ending
December 31, 2031, to be approximately 850,000 GEOs2,4 (from 870,000 GEOs2,4 previously).
In accordance with Wheaton Precious Metals™ Corp.’s (“Wheaton Precious Metals”, “Wheaton”
or the “Company”) MD&A and Financial Statements, reference to the Company and Wheaton
includes the Company’s wholly owned subsidiaries.
End Notes
1 Please refer to non-IFRS measures at the end of this press release. Dividends declared in the referenced calendar
quarter, relative to the financial results of the prior quarter. Details of the dividend can be found in the Wheaton’s
news release date November 3, 2022, titled “Wheaton Precious Metals Declares Quarterly Dividend.”
2 Company reports & S and P Capital IQ est. of 2022 byproduct cost curves for gold, zinc/lead, copper, PGM, nickel &
silver mines. GEOs and SEOs, which are provided to assist the reader, are based on the following commodity price
assumptions: $1800/oz, silver $24/oz, palladium $2,100/oz and cobalt $33/lb.
3 Portfolio mine life based on recoverable reserves and resources as of Dec 31, 2021 and 2021 actual mill throughput
and is weighted by individual reserve and resource category.
4 Five- and ten-year guidance do not include optionality production from Pascua Lama, Navidad, Cotabambas,
Metates or additional expansions at Salobo outside of the project currently in construction. In addition, five-year
guidance also does not include any production from Kutcho, or the Victor project at Sudbury.
5 The Hecla shares represent approximately 6% of Hecla’s current issued and outstanding shares and are subject to
a six month hold period from the closing date of September 7, 2022.
Condensed Interim Consolidated Statements of Earnings
Three Months Ended
September 30
Nine Months Ended
September 30
(US dollars and shares in thousands, except per share
amounts - unaudited) 2022 2021 2022 2021
Sales $ 218,836 $ 268,957 $ 829,002 $ 923,468
Cost of sales
Cost of sales, excluding depletion $ 60,955 $ 62,529 $ 205,891 $ 219,757
Depletion 55,728 54,976 178,812 195,458
Total cost of sales $ 116,683 $ 117,505 $ 384,703 $ 415,215
Gross margin $ 102,153 $ 151,452 $ 444,299 $ 508,253
General and administrative expenses 8,360 7,932 27,448 26,572
Share based compensation 77 4,139 11,586 13,746
Donations and community investments 1,406 1,524 3,379 3,712
Reversal of impairment of mineral stream interests (10,330) - (10,330) -
Earnings from operations $ 102,640 $ 137,857 $ 412,216 $ 464,223
Gain on disposal of mineral stream interest (104,425) - (104,425) -
Other (income) expense (2,799) 1,108 (3,448) (2,194)
Earnings before finance costs and income taxes $ 209,864 $ 136,749 $ 520,089 $ 466,417
Finance costs 1,398 1,379 4,209 4,309
Earnings before income taxes $ 208,466 $ 135,370 $ 515,880 $ 462,108
Income tax (expense) recovery (12,006) (433) (12,879) 955
Net earnings $ 196,460 $ 134,937 $ 503,001 $ 463,063
Basic earnings per share $ 0.435 $ 0.300 $ 1.114 $ 1.029
Diluted earnings per share $ 0.434 $ 0.299 $ 1.112 $ 1.026
Weighted average number of shares
outstanding
Basic 451,757 450,326 451,402 449,977
Diluted 452,386 451,717 452,221 451,369
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Condensed Interim Consolidated Balance Sheets
As at
September 30
As at
December 31
(US dollars in thousands - unaudited) 2022 2021
Assets
Current assets
Cash and cash equivalents $ 494,618 $ 226,045
Accounts receivable 11,536 11,577
Other 14,764 12,102
Total current assets $ 520,918 $ 249,724
Non-current assets
Mineral stream interests $ 5,807,056 $ 5,905,797
Early deposit mineral stream interests 46,092 34,741
Mineral royalty interest 6,606 6,606
Long-term equity investments 190,472 61,477
Convertible notes receivable - 17,086
Property, plant and equipment 4,505 5,509
Other 11,946 15,211
Total non-current assets $ 6,066,677 $ 6,046,427
Total assets $ 6,587,595 $ 6,296,151
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 11,274 $ 13,939
Current taxes payable 6,163 132
Current portion of performance share units 10,407 14,807
Current portion of lease liabilities 803 813
Total current liabilities $ 28,647 $ 29,691
Non-current liabilities
Performance share units 3,661 11,498
Lease liabilities 1,348 2,060
Deferred income taxes 1,954 100
Pension liability 3,173 2,685
Total non-current liabilities $ 10,136 $ 16,343
Total liabilities $ 38,783 $ 46,034
Shareholders' equity
Issued capital $ 3,741,211 $ 3,698,998
Reserves 7,464 47,036
Retained earnings 2,800,137 2,504,083
Total shareholders' equity $ 6,548,812 $ 6,250,117
Total liabilities and shareholders' equity $ 6,587,595 $ 6,296,151