MAG Silver (NYSE:MAG) Corp. has announced a robust third quarter for 2023, with its Juanicipio processing facility reaching nameplate capacity in September and demonstrating impressive cost performance. The facility processed 322,249 tonnes of mineralized material during the quarter, achieving silver recovery rates consistently above 88%.
The average head grade for the three months ending September was 523 grams per tonne, resulting in the production of 4.78 million ounces of silver. Over the nine-month period, the average grade was slightly lower at 474 g/t, yielding a total of 12.29 million ounces.
Financially, Juanicipio saw a cash cost of $4.68 per silver ounce sold and an all-in-sustaining cost of $9.19 per silver ounce in Q3. This efficiency translated into an operating cash flow of $57,346 and a free cash flow of $40,649 for the quarter. The operation's end-of-quarter cash balances stood at $23,434, marking an increase of $14,895 over the second quarter due to strong operating cash flows as production levels met targets.
Further bolstering its financial position, on October 4th MAG secured a $40,000 senior revolving credit facility with the Bank of Montreal. This move came as Juanicipio reduced its reliance on external processing facilities like Fresnillo (LON:FRES) and Saucito.
Earlier this year, from June 20th, MAG was included in the NYSE Arca Gold Miners Index. For Q3, the company reported net income of $8,862 ($0.09 per share) and an Adjusted EBITDA of $29,920.
MAG Silver also continued its commitment to sustainability by publishing its second annual Sustainability Report in September, detailing its environmental, social, and governance (ESG) efforts for 2022.
The company's exploration activities remained active throughout Q3 with ongoing infill drilling at Juanicipio utilizing both surface and underground rigs. Additionally, MAG launched a Phase 3 drilling program at its Deer Trail Project in Utah on May 29th and completed an initial drilling campaign at the Larder Project in Ontario, followed by a comprehensive data re-evaluation by the geological team.
As of September 30th, MAG held a working capital of $55,088 including cash reserves of $58,519 and no long-term debt. Juanicipio's working capital was reported at $99,556 including cash on hand of $23,434.
InvestingPro Insights
Based on the real-time data from InvestingPro, MAG Silver Corp. has a market capitalization of $1000M and is currently trading at a P/E ratio of 32.13 as of Q2 2023. The company's PEG Ratio stands at 0.36, suggesting that it might be undervalued given its earnings growth rate. Furthermore, the company's Price to Book ratio is 2.08, indicating that the market values every dollar of the company's assets at roughly two times.
Two key InvestingPro Tips for MAG Silver Corp. are worth noting. First, the company's earnings per share have been consistently increasing, which is a positive sign for potential investors. Second, net income is expected to grow this year, indicating that the company's profitability is on an upward trajectory.
With a total of 12 additional InvestingPro Tips available, investors can gain more comprehensive insights into MAG Silver Corp. by accessing the InvestingPro platform. This will enable them to make more informed decisions about their investments.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.