WHEATON PRECIOUS METALS GENERATES STRONG OPERATING CASH FLOW ON RECORD GOLD PRODUCTION AND SALES VOLUMES IN 2019 “Wheaton’s portfolio of high-quality, long-life assets generated over $500 million in operating cash
March 11, 2020 TSX: WPM
Vancouver, British Columbia NYSE: WPM
WHEATON PRECIOUS METALS GENERATES STRONG OPERATING CASH FLOW
ON RECORD GOLD PRODUCTION AND SALES VOLUMES IN 2019
“Wheaton’s portfolio of high-quality, long-life assets generated over $500 million in operating cash
flow in 2019 with annual gold production and sales volumes achieving a new record,” said Randy
Smallwood, President and Chief Executive Officer of Wheaton Precious Metals. “For the first time
in company history, Wheaton produced over 400,000 ounces of gold, and that is in addition to
over 22.5 million ounces of silver and 22 thousand ounces of palladium. With our strong organic
growth profile combined with numerous opportunities that could further grow our asset base, we
look forward to setting many new records in the coming years. In addition, we are pleased to
deliver greater value back to our shareholders in 2020 by increasing the minimum quarterly
dividend by over 10% relative to last year."
Fourth Quarter and Year End 2019 Highlights:
• Attributable gold production was over 100,000 ounces in the fourth quarter resulting in
record annual gold production in 2019 of over 406,000 ounces.
• Total production of 707,200 gold equivalent ounces2 in 2019 exceeded production guidance
for the eighth consecutive year.
• Record gold sales volumes in 2019 of approximately 390,000 ounces.
• Over $131 million in operating cash flow in the fourth quarter resulting in over $500 million
in operating cash flow in 2019.
• Net debt1 reduced by $418 million in 2019 with Wheaton ending the year with net debt of
$771 million.
• Declared quarterly dividend1 of $0.10 per common share, an 11% increase.
Operational Overview
Q4 2019 Q4 2018 Change 2019 2018 Change
Ounces produced
Gold 107,225 107,160 0.1 % 406,675 383,974 5.9 %
Silver 5,962 5,499 8.4 % 22,562 24,474 (7.8)%
Palladium 6,057 5,869 3.2 % 21,993 14,686 49.8 %
Gold equivalent 2 186,892 180,936 3.3 % 707,195 700,446 1.0 %
Ounces sold
Gold 89,223 102,813 (13.2)% 389,086 349,168 11.4 %
Silver 4,684 4,400 6.5 % 17,703 21,733 (18.5)%
Palladium 5,312 5,049 5.2 % 20,681 8,717 137.2 %
Gold equivalent 2 152,389 162,205 (6.1)% 628,447 625,701 0.4 %
Revenue $ 223,222 $ 196,591 13.5 % $ 861,332 $ 794,012 8.5 %
Net earnings $ 77,524 $ 6,828 1,035 % $ 86,138 $ 427,115 (79.8)%
Per share $ 0.17 $ 0.02 750.0 % $ 0.19 $ 0.96 (80.2)%
Adjusted net earnings 1 $ 77,953 $ 36,745 112.1 % $ 251,993 $ 213,782 17.9 %
Per share 1 $ 0.17 $ 0.08 110.5 % $ 0.56 $ 0.48 17.2 %
Operating cash flows $ 131,867 $ 108,461 21.6 % $ 501,620 $ 477,413 5.1 %
Per share 1 $ 0.29 $ 0.24 20.8 % $ 1.12 $ 1.08 3.7 %
Dividends paid 1 $ 40,252 $ 39,959 0.7 % $ 160,656 $ 159,619 0.6 %
Per share $ 0.09 $ 0.09 0.0 % $ 0.36 $ 0.36 0.0 %
All amounts in thousands except gold, palladium and gold equivalent ounces produced and sold, per ounce amounts and per share amounts. 12
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Subsequent to the Quarter
• The Company has set a minimum quarterly dividend of $0. 10 per common share for the
duration of 2020, representing an 11% increase relative to 2019 , subject to the discretion
of the Board of Directors. Under the new minimum dividend policy, the forecast annualized
dividend for 2020 would represent an increase of more than 90% over a five-year period.
• Wheaton announces its intention to initiate an at-the-market equity program.
Production Guidance
• Wheaton’s estimated attributable production in 2020 is forecast to be 390,000 to 410,000
ounces of gold, 22 .0 to 23 .5 million ounces of silver, and 23,000 to 24,500 ounces of
palladium, resulting in gold equivalent production 3 of approximately 685,000 to 7 25,000
ounces.
• For the five-year period ending in 2024, the Company estimates that average annual gold
equivalent production3 will amount to 750,000 ounces.
Financial Review
Revenues
Revenue was $223 million in the fourth quarter of 2019 representing a 14% increase from the
fourth quarter of 2018 due primarily to:
• 21% increase in the average realized gold price;
• 18% increase in the average realized silver price;
• 6% increase in the number of silver ounces sold; and
• 59% increase in the average realized palladium price; partially offset by
• 13% decrease in the number of gold ounces sold.
Revenue was $861 million in the year ended December 31, 2019 representing an 8% increase
from 2018 due primarily to:
• 10% increase in the average realized gold price;
• 11% increase in the number of gold ounces sold;
• 137% increase in the number of palladium ounces sold;
• 3% increase in the average realized silver price; and
• 45% increase in the average realized palladium price; partially offset by
• 19% decrease in the number of silver ounces sold.
Costs and Expenses
Average cash costs¹ in the fourth quarter of 2019 were:
• $426 per gold ounce as compared to $409 in Q4 2018;
• $5.13 per silver ounce as compared to $4.66 in Q4 2018; and
• $321 per palladium ounce as compared to $205 in Q4 2018.
This resulted in a cash operating margin¹ of:
• $1,057 per gold ounce sold, an increase of 29% as compared with Q4 2018;
• $12.23 per silver ounce sold, an increase of 22% as compared with Q4 2018; and
• $1,483 per palladium ounce sold, an increase of 59% as compared with Q4 2018.
Average cash costs¹ in 2019 were:
• $421 per gold ounce as compared to $409 in 2018;
• $5.02 per silver ounce as compared to $4.67 in 2018; and
• $273 per palladium ounce as compared to $190 in 2018.
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This resulted in a cash operating margin¹ of:
• $969 per gold ounce sold, an increase of 13% as compared with 2018;
• $11.27 per silver ounce sold, an increase of 1% as compared with 2018; and
• $1,269 per palladium ounce sold, an increase of 46% as compared with 2018.
Balance Sheet (at December 31, 2019)
• Approximately $104 million of cash on hand.
• $875 million outstanding under the Company's $2 billion revolving term loan (the "Revolving
Facility"). Subsequent to December 31, 2019, the term of the Revolving Facility was
extended by an additional year, with the facility now maturing on February 27, 2025.
• During Q4 2019, the Company has repaid $139 million under the Revolving Facility.
• During Q4 2019, the net debt¹ was reduced by $91 million to $771 million.
• The average effective interest rate for the fourth quarter of 2019 was 3.62%.
Fourth Quarter Asset Highlights
Salobo: In the fourth quarter of 2019, Salobo produced 74,700 ounces of attributable gold,
virtually unchanged relative to the fourth quarter of 2018. In Vale S.A.’s (“Vale”) Fourth Quarter
2019 Performance Report, Vale reports that physical completion of the Salobo III mine
expansion is now 40% and is on track to start up in the first half of 2022.
Peñasquito: In the fourth quarter of 2019, Peñasquito produced 1.9 million ounces of
attributable silver, an increase of approximately 30% relative to the fourth quarter of 2018
primarily due to higher grades.
San Dimas: In the fourth quarter of 2019, San Dimas produced 11,400 ounces of attributable
gold, an increase of approximately 12% relative to the fourth quarter of 2018 primarily due to
higher grades and throughput . According to First Majestic Silver Corp.’s (“First Majestic”)
Fourth Quarter 2019 MD&A, First Majestic has announced plans to increase production at
San Dimas by restarting mining operations at the past-producing Tayoltita mine by the end of
the first quarter and expects to ramp up production to add another 300 tpd to San Dimas
throughput by the end of 2020. In addition, First Majestic plans to install a new 3,000 tpd high-
intensity grinding mill circuit and an autogenous grinding mill in the second half of 2020 to
further improve recoveries and reduce operating costs.
Antamina: In the fourth quarter of 2019, Antamina produced 1.3 million ounces of attributable
silver, an increase of approximately 10% relative to the fourth quarter of 2018 , primarily due
to higher grades.
Constancia: In the fourth quarter of 2019, Constancia produced 0.6 million ounces of
attributable silver and 4,800 ounces of attributable gold, a decrease of approximately 9% for
silver production and an increase of approximately 12% for gold production relative to the
fourth quarter of 2018. As per Wheaton’s precious metals purchase agreement with Hudbay
Minerals Inc. (“Hudbay”), should Hudbay fail to achieve a minimum level of throughput at the
Pampacancha deposit during 2018, 2019 and 2020, Wheaton will be entitled to an additional
8,020 ounces of gold (received in quarterly installments) in each of 2019, 2020 and 2021, of
which 8,020 ounces of gold was received during 2019. As per Hudbay’s news release dated
February 18, 2020, Hudbay secured the surface rights for the Pampacancha deposit and
expects to begin mining ore from the satellite deposit in late 2020.
Other Gold: In the fourth quarter of 2019, total Other Gold attributable production was 6,200
ounces, an increase of approximately 9% relative to the fourth quarter of 2018, primarily due
to the resumption of mining at the Minto mine.
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Produced But Not Yet Delivered 4
As at December 31, 2019 , payable ounces attributable to the Company produced but not yet
delivered amounted to:
• 98,600 payable gold ounces, an increase of 13,300 ounces during Q4 2019 , primarily the
result of a build up during the period relative to the Salobo mine.
• 4.5 million payable silver ounces, an increase of 0.4 million ounces during Q4 2019, primarily
the result of a build up during the period relative to the Peñasquito mine.
• 4,900 payable palladium ounces, an increase of 700 ounces during Q4 2019.
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.
Reserves and Resources (at December 31, 2019)
• Proven and Probable Mineral Reserves attributable to Wheaton were 11.40 million ounces
of gold compared with 11.76 million ounces as reported in Wheaton’s 2018 Annual
Information Form (“AIF”), a decrease of 3% ; 544.4 million ounces of silver compared with
541.3 million ounces, an increase of 1% ; palladium resources of 0.66 million ounces and
cobalt of 32.6 million pounds were unchanged from 2018.
• Measured and Indicated Mineral Resource s attributable to Wheaton were 2.7 1 million
ounces of gold compared with 2.88 million ounces as reported in Wheaton’s 2018 AIF, a
decrease of 6%; silver resources were 744.7 million ounces compared with 780.6 million
ounces, a decrease of 5%; cobalt resources of 1.6 million pounds of cobalt were unchanged
from 2018.
• Inferred Mineral Resource s attributable to Wheaton were 4.16 million ounces of gold
compared with 4.13 million ounces as reported in Wheaton’s 2018 AIF, an increase of 1%;
silver resources were 485.7 million ounces compared with 441.7 million ounces, an increase
of 10%, palladium resources were 0.35 million ounces compared with 0.36 million ounces,
a decrease of 1% and cobalt resources of 9.3 million pounds were unchanged from 2018.
Estimated attributable reserves and resources contained in thi s press release are based on
information available to the Company as of March 11, 2020, and therefore will not reflect updates,
if any, after that date. Updated reserves and resources data incorporating year -end 2019
estimates will also be included in the Company's 2019 Annual Information Form. Wheaton’s most
current attributable reserves and resources, as of December 31, 2019, can be found on the
Company’s website at www.wheatonpm.com.
At-The-Market Equity Program
Wheaton intends to initiate an at-the-market equity program (the “ATM Program”) that would allow
the Company to issue up to $300 million worth of common shares from treasury (“Common
Shares”) to the public from time to time at the prevailing market price or other prices through the
Toronto Stock Exchange, the New York Stock Exchange or any other marketplace on which the
Common Shares are listed, quoted or otherwise trade. The volume and timing of distributions
under the ATM Program, i f any, will be determined at the Company’s sole discretion, subject to
applicable regulatory limitations. The ATM Program remains subject to negotiation of definitive
agreements with the Canadian and U.S. agents, filing of the prospectus supplement with th e
Canadian securities regulators and U.S. Securities and Exchange Commission (the “SEC”)
respectively and receipt of all regulatory approvals, which conditions are anticipated to be satisfied
in April. Wheaton intends that the net proceeds from the ATM Pro gram, if any, will be available
as one potential source of funding for stream acquisitions and/or other general corporate
purposes including the repayment of indebtedness. Details of the ATM Program will be provided
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upon filing of a prospectus supplement with the Canadian securities regulators and the SEC in
early April. Sales of common shares through the ATM Program will be made pursuant to the
terms of an equity distribution agreement.
Outlook
Wheaton’s e stimated a ttributable production in 2020 is forecast to be between 685,000 and
725,000 gold equivalent ounces 3 comprised of 390,000 to 410,000 gold ounces, 22.0 to 23.5
million silver ounces, and 23,000 to 24,500 palladium ounces. For the five-year period ending in
2024, the Company estimates that average annual gold equivalent production 3 will amount to
750,000 ounces. As a reminder, Wheaton does not include any production from Barrick’s Pascua-
Lama project or Hudbay’s Rosemont project in its estimated average five -year production
guidance.
From a liquidity perspective, the $ 104 million of cash and cash equivalents as at December 31,
2019 combined with the liquidity provided by the available credit under the $2 billion Revolving
Facility and ongoing operating cash flows positions the Company well to fund all outstanding
commitments and known contingencies as well as providing flexibility to acquire additional
accretive precious metal stream interests.
Health and Safety
The company is keeping up to date on developments surrounding COVID-19 and is taking steps
to protect the health and safety of its employees as well as considering any possible impacts to
its business.
Webcast and Conference Call Details
A conference call and webcast will be held Thursday, March 12, 2020 , starting at 11:00 am
(Eastern Time) 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: 888-231-8191
Dial from outside Canada or the US: 647-427-7450
Pass code: 6437236
Live audio webcast: Click here
Participants should dial in five to ten minutes before the call.
The conference call will be recorded and available until March 19, 2020 at 11:59 pm (Eastern
Time). 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: 855-859-2056
Dial from outside Canada or the US: 416-849-0833
Pass code: 6437236
Archived audio webcast: Click here
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 and Neil Burns, P. Geo., Vice
President, Technical Services for Wheaton Precious Metals, are a “qualified person” as such term
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is defined under National Instrument 43-101, and ha ve reviewed and approved the technical
information disclosed in this news release (specifically Mr. Carson has reviewed production
figures and Mr. Burns has reviewed mineral reserves and resource 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.
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 accreti ve acquisitions. As a result,
Wheaton has consistently outperformed gold and silver, as well as other mining investments.
Wheaton creates sustainable value through streaming.
In accordance with Wheaton Precious Metals™ Corp.’s (“Wheaton Precious Metals “, “Wheaton”
or the “Company”) MD&A and financial statements, reference to the Company 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.
2 Commodity price assumptions for the gold equivalent production and sales in 2019 are $1,300 / ounce gold, $16 /
ounce silver, and $1,350 / ounce palladium.
3 Commodity price assumptions for the forecasts of gold equivalent production for 2020 and the five-year average to
2024, are $1,500 / ounce gold, $18 / ounce silver, $2,000 / ounce palladium, and $16 / pound of cobalt.
4 Payable gold, silver and palladium ounces produced but not yet delivered are based on management estimates only
and rely upon information provided by the owners and operators of mining operations and may be revised and
updated in future periods as additional information is received.
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Consolidated Statements of Earnings
Years Ended December 31
(US dollars and shares in thousands, except per share amounts) 2019 2018
Sales $ 861,332 $ 794,012
Cost of sales
Cost of sales, excluding depletion $ 258,559 $ 245,794
Depletion 256,826 252,287
Total cost of sales $ 515,385 $ 498,081
Gross margin $ 345,947 $ 295,931
General and administrative expenses 54,507 51,650
Impairment of mineral stream interests 165,912 -
Earnings from operations $ 125,528 $ 244,281
Gain on disposal of mineral stream interest - (245,715)
Other (income) expense (274) 5,826
Earnings before finance costs and income taxes $ 125,802 $ 484,170
Finance costs 48,730 41,187
Earnings before income taxes $ 77,072 $ 442,983
Income tax recovery (expense) 9,066 (15,868)
Net earnings $ 86,138 $ 427,115
Basic earnings per share $ 0.19 $ 0.96
Diluted earnings per share $ 0.19 $ 0.96
Weighted average number of shares outstanding
Basic 446,021 443,407
Diluted 446,930 443,862
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Consolidated Balance Sheets
As at
December 31
As at
December 31
(US dollars in thousands) 2019 2018
Assets
Current assets
Cash and cash equivalents $ 103,986 $ 75,767
Accounts receivable 7,138 2,186
Current taxes receivable 124 210
Other 43,504 1,541
Total current assets $ 154,752 $ 79,704
Non-current assets
Mineral stream interests $ 5,734,106 $ 6,156,839
Early deposit mineral stream interests 31,741 30,241
Mineral royalty interest 3,036 9,107
Long-term equity investments 309,757 164,753
Investment in associates 882 2,562
Convertible notes receivable 21,856 12,899
Property, plant and equipment 7,311 3,626
Other 14,566 10,315
Total non-current assets $ 6,123,255 $ 6,390,342
Total assets $ 6,278,007 $ 6,470,046
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 11,794 $ 19,883
Current taxes payable - 3,361
Current portion of performance share units 10,668 5,578
Current portion of lease liabilities 724 -
Other 41,514 19
Total current liabilities $ 64,700 $ 28,841
Non-current liabilities
Bank debt $ 874,500 $ 1,264,000
Lease liabilities 3,528 -
Deferred income taxes 148 111
Performance share units 8,401 5,178
Pension liability 810 -
Total non-current liabilities $ 887,387 $ 1,269,289
Total liabilities $ 952,087 $ 1,298,130
Shareholders' equity
Issued capital $ 3,599,203 $ 3,516,437
Reserves 160,701 7,893
Retained earnings 1,566,016 1,647,586
Total shareholders' equity $ 5,325,920 $ 5,171,916
Total liabilities and shareholders' equity $ 6,278,007 $ 6,470,046