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Silver Wheaton Reports Record Quarterly Financial Results Including Operating Cash Flows of Over US$172 Million

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VANCOUVER, British Columbia, August 9, 2012 /PRNewswire/ --

TSX: SLW
NYSE: SLW

Silver Wheaton Corp. ("Silver Wheaton" or the "Company") (TSX:SLW)(NYSE: SLW) is pleased to announce its unaudited results for the second quarter ended June 30, 2012.

SECOND QUARTER HIGHLIGHTS

  • Attributable silver equivalent production of 6.7 million ounces (6.5 million ounces of silver and 3,200 ounces of gold), an increase of 10% compared with Q2 2011
  • Revenues increased 3% compared with Q2 2011, to a record US$201.4 million, on record silver equivalent sales of 6.9 million ounces (6.8 million ounces of silver and 2,400 ounces of gold).
  • Net earnings were US$141.4 million (US$0.40 per share) compared to US$148.1 million (US$0.42 per share) in Q2 2011.
  • Operating cash flows increased 3% compared with Q2 2011, to a record US$172.9 million (US$0.49 per share[1]).
  • Cash operating margin[1] was US$25.01[1] per silver equivalent ounce, compared to US$34.21 in Q2 2011.
  • Average cash costs[1] fell slightly compared with Q2 2011, to US$4.06[1] per silver equivalent ounce (US$4.04 per ounce of silver and US$303 per ounce of gold).
  • Cash balance of US$1.1 billion, with a net cash position of US$1.04 billion at the end of Q2 2012.
  • Declared quarterly dividend of US$0.10 per common share, representing 20% of the cash generated by operating activities during the three months ended June 30, 2012.
  • Announced attributable proven and probable silver reserves of 798 million ounces, nearly twice the reserves of any other silver company in the world.
  • Subsequent to the second quarter, Silver Wheaton announced that it has agreed to acquire a precious metals stream from Hudbay Minerals Inc.'s ("Hudbay") currently producing flagship 777 Mine ("777"), as well as a silver stream from their cornerstone development project, Constancia. Combined, 777 and Constancia will increase Silver Wheaton's long-term average annual silver equivalent production by approximately 4.9 million ounces[2].


 

"For the second quarter in a row, we achieved record silver sales and revenues, putting us on track for our best year ever," said Randy Smallwood, President and Chief Executive Officer of Silver Wheaton. "Production from most of our assets was very solid, with Zinkgruvan once again delivering a strong quarter and with sales of concentrate produced but not yet delivered from Yauliyacu contributing considerably to our revenues and cash flow. While we did see some temporary shortfalls in production at the Peñasquito mine and a delay at Pascua-Lama, we remain confident in our partners and view both of these assets as core streams which solidify our industry-leading growth profile."

"We recently announced a transaction with Hudbay that once again highlights the effectiveness of our business model, combining the certainty of fixed capital and operating costs with immediate cash flow and long term growth potential. We are extremely excited about adding two new streams, one for silver and gold from Hudbay's current flagship mine, 777, and the other for silver from their cornerstone development asset, Constancia. These new streams deliver an immediate increase to our silver and gold production, with 777 contributing average annual production of approximately 4.2 million silver equivalent ounces[1] until the end of 2016. Once Constancia is in full production, which is forecast by 2015, both mines provide substantial opportunity for future growth. With the addition of these assets to our portfolio, our 2016 production guidance has increased to approximately 48 million silver equivalent ounces."

"Furthermore, we remain very excited about the current opportunity-rich environment. With approximately US$600 million in cash - net of the initial US$500 million upfront payment to Hudbay - a fully undrawn US$400 million revolving credit facility, and strong forecast annual operating cash flow, we believe there is substantial opportunity for further growth both in the near and long-term."

Financial Review

Revenues

Revenue was US$201.4 million in the second quarter of 2012, on silver equivalent sales of 6.9 million ounces (6.8 million ounces of silver and 2,400 ounces of gold), a record for the Company. This represents a 3% increase from the US$194.8 million of revenue generated in the second quarter of 2011. This was due to a 36% increase in the number of silver equivalent ounces sold, which was partially offset by a 24% decrease in the realized price per silver equivalent ounce. The increase in silver equivalent ounces sold was primarily related to the timing of shipments of stockpiled concentrate in addition to increased production at some of the mines underlying the Company's silver purchase agreements.

Costs and Expenses

Average cash costs[1] in the second quarter of 2012 were US$4.06[1] per silver equivalent ounce, compared with US$4.14[1] during the comparable period of 2011. This resulted in cash operating margins[1]of US$25.01[1] per silver equivalent ounce, a 27% decrease compared to the second quarter of 2011, primarily a result of a 24% decrease in the realized price per silver equivalent ounce.

During the second quarter of 2012, the Company recorded an income tax expense of US$2.8 million, which includes a non-cash deferred income tax expense of US$2.5 million, attributable primarily to the reversal of previously recognized deferred income tax assets relating to the decline in fair value of long-term investments in common shares and to income from Canadian operations. This compares to an income tax expense of $2.4 million in the comparable period of the previous year, which included a non-cash deferred income tax expense of $2.2 million.

Earnings and Operating Cash Flows

Net earnings in the second quarter of 2012 were US$141.4 million (US$0.40 per share), compared with US$148.1 (US$0.42 per share) for the same period in 2011, a decrease of 5%. Cash flow from operations in the second quarter of 2012 was US$172.9 million (US$0.49 per share[1]), compared with US$168.3 million (US$0.48 per share[1]) for the same period in 2011, an increase of 3%. The change in net earnings and operating cash flows is primarily due to a 36% increase in the number of silver equivalent ounces sold, which was partially offset by a 24% decrease in the realized price per silver equivalent ounce.

Balance Sheet

At June 30, 2012, the Company had approximately US$1.1 billion of cash on hand. In addition, the Company had US$400 million of available credit under its revolving bank debt facility. Following the initial US$500 million upfront payment due to Hudbay under the recently announced transaction, the combination of cash, available credit, and strong operating cash flows, positions the Company well to execute on its growth strategy of acquiring additional accretive silver stream interests.

Operational Highlights

Attributable silver equivalent production was 6.7 million ounces (6.5 million ounces of silver and 3,200 ounces of gold) in the second quarter of 2012, representing an increase of 10% compared to the second quarter of 2011.

Operational highlights for the quarter ended June 30, 2012 are as follows:

Peñasquito -

While attributable silver production increased 42% compared to 2011, to over 1.8 million ounces, as per Goldcorp Inc.'s ("Goldcorp") July 10, 2012 disclosure, second quarter mill throughput at its Peñasquito mine was impacted by lower than anticipated water supplies, the result of prolonged drought conditions in the region. The water deficit is expected to limit plant throughput to between approximately 98,000 and 107,000 tonnes per day over the balance of 2012, resulting in a reduction of forecast silver production attributable to Silver Wheaton during this period.

Goldcorp holds permits for sufficient quantities of water and is currently working to drill additional wells to increase water production. Concurrently, work is also underway to increase the quantity of water reclaimed from the tailings facility. Goldcorp highlighted that both the processing plant and the ore body continue to perform well, and the focus now is on bringing water wells into production. Peñasquito will become Silver Wheaton's largest contributor of silver production in 2012, with forecast attributable silver production of approximately 7 million ounces once at full design capacity.

Pascua-Lama -

As per Barrick Gold Corporation's ("Barrick") second quarter 2012 MD&A, initial production at their world-class gold-silver Pascua-Lama project has been delayed due to lower than expected productivity. Initial production, previously expected in mid-2013, is now expected in mid-2014, with an approximate 50 to 60 percent increase in capital costs from the top end of its previously announced estimate of $4.7 to $5.0 billion. During the second quarter, the project achieved critical milestones with completion of Phase 1 of the pioneering road and also the water management system in Chile, both of which enabled the commencement of pre-stripping activities.

Until December 31, 2015, Silver Wheaton will be entitled to all or a portion of the silver production from Barrick's Veladero, Pierina and Lagunas Norte mines, to the extent Pascua-Lama is operating below 75% of design capacity. Once in production, Pascua-Lama is forecast to be one of the largest and lowest cost gold mines in the world with an expected mine life in excess of 25 years. In its first full five years of operation, Silver Wheaton's attributable silver production is expected to average nine million ounces annually.

Zinkgruvan  -

Silver Wheaton's second quarter 2012 attributable silver production from the Zingruvan mine was a record 673,000 ounces, an increase of 63% compared to the second quarter of 2011. As per Lundin Mining Corporation's July 25, 2012 disclosure, metal production year-to-date is at all time highs due to high ore grades, good recoveries and record throughput levels.

Produced But Not Yet Delivered -

Payable silver equivalent ounces produced but not yet delivered to Silver Wheaton by its partners fell by almost one million ounces to approximately 3.2 million silver equivalent payable ounces at June 30, 2012. The reduction was primarily due to the sale of a substantial portion of the stockpiled concentrates at Glencore International AG's Yauliyacu mine.

Detailed mine by mine production and sales figures can be found in the Appendix of this press release and in Silver Wheaton's Management's Discussion and Analysis ("MD&A") in the 'Results of Operations and Operational Review' section.

This earnings release should be read in conjunction with Silver Wheaton's MD&A and unaudited Financial Statements, which are available on the Company's website at http://www.silverwheaton.com and have been posted on SEDAR at http://www.sedar.com.

On April 24, 2012, the British Columbia Securities Commission ("BCSC") issued a notice of hearing naming as respondents Canaco Resources Inc. ("Canaco") and certain of its directors. Mr. Randy Smallwood, President and CEO of Silver Wheaton, was previously a non-executive director of Canaco, and is named in the notice of hearing. The BCSC alleges that, in December 2010, Canaco failed to file a material change report when it received certain drill results, and, further, that its Board voted to price directors' options prior to disclosure of the drill results. The BCSC alleges that by delaying the disclosure, the Canaco directors were able to set the exercise price of the options lower than would have been the case if Canaco had promptly disclosed the drill results.

The Board of Silver Wheaton has, together with legal counsel to the Board, examined the allegations against Mr. Smallwood and considered the implications to the Company. The Board does not believe that this matter will adversely affect Mr. Smallwood's ability to perform his role as the Company's President and CEO. Furthermore, the Board has been advised that Mr. Smallwood has a legitimate defence to these unproven allegations, which he intends to vigorously defend. In light of the foregoing, and given the Board's confidence in Mr. Smallwood, they continue to be fully and completely supportive of him in his role as President and CEO of Silver Wheaton.

Webcast and Conference Call Details

A conference call will be held Friday, August 10, 2012, 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: 1-888-231-8191
    Dial from outside Canada or the US:   1-647-427-7450
    Pass code:                            98200489
    Live audio webcast:                   http://www.silverwheaton.com




Participants should dial in five to ten minutes before the call.

The conference call will be recorded and you can listen to an archive of the call by one of the following methods:

    Dial toll free from Canada or the US: 1-855-859-2056
    Dial from outside Canada or the US:   1-416-849-0833
    Pass code:                            98200489
    Archived audio webcast:               http://www.silverwheaton.com


About Silver Wheaton

Silver Wheaton is the largest silver streaming company in the world. Based upon its current agreements, forecast 2012 attributable production is approximately 28 million silver equivalent ounces, including 42,000 ounces of gold. By 2016, annual attributable production is anticipated to increase significantly to approximately 48 million silver equivalent ounces, including 100,000 ounces of gold. This growth is driven by the Company's portfolio of low-cost and long-life assets, including silver and precious metal streams on Barrick's Pascua-Lama project and Hudbay's flagship 777 mine and Constancia project.

CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS
The information contained herein contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking statements, which are all statements other than statements of historical fact, include, but are not limited to, statements with respect to the future price of silver and gold, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, reserve determination, reserve conversion rates and statements as to any future dividends. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Silver Wheaton to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: fluctuations in the price of silver and gold; the absence of control over mining operations from which Silver Wheaton purchases silver or gold and risks related to these mining operations including risks related to fluctuations in the price of the primary commodities mined at such operations, actual results of mining and exploration activities, economic and political risks of the jurisdictions in which the mining operations are located and changes in project parameters as plans continue to be refined; and differences in the interpretation or application of tax laws and regulations; as well as those factors discussed in the section entitled "Description of the Business - Risk Factors" in Silver Wheaton's Annual Information Form available on SEDAR at http://www.sedar.com and in Silver Wheaton's Form 40-F on file with the U.S. Securities and Exchange Commission in Washington, D.C. Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to: the continued operation of the mining operations from which Silver Wheaton purchases silver or gold, no material adverse change in the market price of commodities, that the mining operations will operate and the mining projects will be completed in accordance with their public statements and achieve their stated production outcomes, and such other assumptions and factors as set out herein. Although Silver Wheaton has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate. Accordingly, readers should not place undue reliance on forward-looking statements. Silver Wheaton does not undertake to update any forward-looking statements that are included or incorporated by reference herein, except in accordance with applicable securities laws.

________________________________
[1] Please refer to non-IFRS measures at the end of this press release.
[2] Silver equivalent production forecast assumes a gold/silver ratio of 50:1



Consolidated Statement of Earnings

                                    Three Months Ended     Six Months Ended
                                          June 30               June 30
    (US dollars and shares in
    thousands, except per share
    amounts - unaudited)              2012       2011       2012       2011
    Sales                           $ 201,408  $ 194,752  $ 401,046  $ 352,935
    Cost of sales
    Cost of sales, excluding
    depletion                       $  28,116  $  21,000  $  53,135  $  40,947
    Depletion                          21,591     14,734     38,797     26,417
    Total cost of sales             $  49,707  $  35,734  $  91,932  $  67,364
    Earnings from operations        $ 151,701  $ 159,018  $ 309,114  $ 285,571
    Expenses and other income
    General and administrative
    [1]                             $   7,354  $   6,252  $  14,918  $  12,754
    Foreign exchange loss (gain)           39      (502)          9      (506)
    Other expense (income)                144      2,765      (506)      2,905
                                    $   7,537  $   8,515  $  14,421  $  15,153
    Earnings before income taxes    $ 144,164  $ 150,503  $ 294,693  $ 270,418
    Income tax expense                (2,750)    (2,438)    (6,098)      (177)
    Net earnings                    $ 141,414  $ 148,065  $ 288,595  $ 270,241
 
    Basic earnings per share        $    0.40  $    0.42  $    0.82  $    0.77
    Diluted earnings per share      $    0.40  $    0.42  $    0.81  $    0.76
    Weighted average number of
    shares outstanding
    Basic                             353,733    353,267    353,631    353,083
    Diluted                           355,519    355,921    355,751    355,895
    1) Equity settled stock based
    compensation (a non-cash
    item) included in general and
    administrative expenses.        $   1,669  $   1,814  $   3,328  $   3,069
 


Consolidated Balance Sheets

                                                   June 30     December 31
    (US dollars in thousands - unaudited)            2012          2011
    Assets
    Current assets
    Cash and cash equivalents                     $ 1,102,116  $     840,201
    Accounts receivable                                 5,927          3,890
    Other                                               2,235          1,221
    Total current assets                          $ 1,110,278  $     845,312
    Non-current assets
    Silver and gold interests                     $ 1,837,945  $   1,871,726
    Long-term investments                             107,307        151,621
    Deferred income taxes                                   -          2,301
    Other                                               1,295          1,375
    Total non-current assets                      $ 1,946,547  $   2,027,023
    Total assets                                  $ 3,056,825  $   2,872,335
    Liabilities
    Current liabilities
    Accounts payable and accrued liabilities      $    12,521  $       8,709
    Current portion of bank debt                       28,560         28,560
    Current portion of silver interest
    payments                                          135,225        130,789
    Total current liabilities                     $   176,306  $     168,058
    Non-current liabilities
    Long-term portion of bank debt                     35,780         50,060
    Deferred income taxes                                  61              -
    Total non-current liabilities                 $    35,841  $      50,060
    Total liabilities                             $   212,147  $     218,118
    Shareholders' equity
    Issued capital                                $ 1,800,338  $   1,793,772
    Reserves                                         (15,620)         25,422
    Retained earnings                               1,059,960        835,023
    Total shareholders' equity                    $ 2,844,678  $   2,654,217
    Total liabilities and shareholders' equity    $ 3,056,825  $   2,872,335
 


Consolidated Statement of Cash Flows

                                Three Months Ended        Six Months Ended
                                     June 30                  June 30
    (US dollars in
    thousands -
    unaudited)                   2012        2011         2012        2011
    Operating
    activities
    Net earnings              $   141,414  $  148,065  $   288,595  $  270,241
    Adjustments for
    Depreciation
    and depletion                  21,651      14,803       38,917      26,557
    Equity settled
    stock based
    compensation                    1,669       1,814        3,328       3,069
    Deferred income
    tax expense
    (recovery)                      2,498       2,249        5,566       (269)
    Loss (gain) on
      fair value
     adjustment of
    share purchase
     warrants held                    277       2,701        (398)       2,767
      Investment
        income
     recognized in
     net earnings                   (350)       (205)        (669)       (414)
    Other                              80       (162)         (17)       (296)
    Change in
    non-cash
    operating
    working capital                 5,344     (1,178)          770     (6,570)
    Operating cash
    flows before
    interest income           $   172,583  $  168,087  $   336,092  $  295,085
    Interest income
    received                          333         194          635         392
    Cash generated by
    operating activities      $   172,916  $  168,281  $   336,727  $  295,477
    Financing
    activities
    Bank debt
    repaid                    $   (7,140)  $  (7,140)  $  (14,280)  $ (14,280)
    Share purchase
    warrants
    exercised                           -           -           10          61
    Share purchase
    options
    exercised                       3,164         667        4,088       5,062
    Dividends paid               (63,658)    (10,599)     (63,658)    (21,194)
    Cash applied to
    financing activities      $  (67,634)  $ (17,072)  $  (73,840)  $ (30,351)
    Investing
    activities
    Silver and gold
    interests                 $         -  $     (16)  $     (180)  $  (2,557)
    Silver and gold
    interests -
    interest paid                   (194)       (385)        (409)       (701)
    Acquisition of
    long-term
    investments                     (395)    (13,674)        (395)    (13,674)
    Proceeds on
    disposal of
    long-term
    investments                         -           -            -      24,270
    Dividend income
    received                           17          11           34          22
    Other                            (42)        (25)         (62)        (33)
    Cash (applied to)
    generated by investing
    activities                $     (614)  $ (14,089)  $   (1,012)  $    7,327
    Effect of exchange rate
    changes on cash and
    cash equivalents          $      (41)  $      155  $        40  $      261
    Increase in cash and
    cash equivalents          $   104,627  $  137,275  $   261,915  $  272,714
    Cash and cash
    equivalents, beginning
    of period                     997,489     564,075      840,201     428,636
    Cash and cash
    equivalents, end of
    period                    $ 1,102,116  $  701,350  $ 1,102,116  $  701,350


Summary of Ounces Produced and Sold

                                  2012              2011              2010
    (in thousands)              Q2    Q1    Q4    Q3    Q2    Q1    Q4    Q3
    Silver ounces produced [1]
    San Dimas [2]              1,227 1,692 1,578 1,251 1,150 1,606 1,586 1,255
    Zinkgruvan                   673   642   390   379   414   508   428   508
    Yauliyacu                    606   550   583   608   674   683   651   633
    Peñasquito                 1,822 1,365 1,633 1,162 1,282 1,207 1,260 1,109
    Cozamin                      429   405   433   395   414   325   335   381
    Barrick [3]                  468   667   723   794   741   722   458   682
    Other [4]                  1,276 1,288 1,389 1,272 1,153 1,088 1,245 1,069
                               6,501 6,609 6,729 5,861 5,828 6,139 5,963 5,637
    Silver equivalent ounces
    of gold produced [5]
    Minto                        189   107   202   257   261    97   205   402
    Silver equivalent ounces
    produced                   6,690 6,716 6,931 6,118 6,089 6,236 6,168 6,039
    Silver ounces sold
    San Dimas [2]              1,295 1,701 1,488 1,232 1,149 1,748 1,438 1,274
    Zinkgruvan                   580   517   425   319   401   321   421   635
    Yauliyacu                  1,155   497   655    11   471   120   470    87
    Peñasquito                 1,845 1,189   851 1,382   961   941 1,169   692
    Cozamin                      395   376   374   335   281   271   411   306
    Barrick [3]                  470   656   755   747   726   680   482   533
    Other [4]                  1,049   992 1,230   770   862   741 1,139   750
                               6,789 5,928 5,778 4,796 4,851 4,822 5,530 4,277
    Silver equivalent ounces
    of
    gold sold [5]
    Minto                        139   198   196   316   227    83   127   411
    Silver equivalent ounces
    sold                       6,928 6,126 5,974 5,112 5,078 4,905 5,657 4,688
    Gold / silver ratio [5]     58.7  51.2  51.9  50.4  40.1  33.0  49.7  57.7
    Cumulative payable
    silver equivalent ounces
    produced but not yet
    delivered [6]              3,212 4,166 4,127 3,805 3,537 3,018 2,275 2,174


1)     Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Production figures are based on information provided by the operators of the mining operations to which the silver or gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
2)     The ounces produced and sold include ounces received from Goldcorp in connection with Goldcorp's four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero.
3)     Comprised of the Lagunas Norte, Pierina and Veladero silver interests.
4)     Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Keno Hill, Minto, Aljustrel and Campo Morado silver interests in addition to the previously owned La Negra and San Martin silver interests.
5)     Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver.
6)     Based on management estimates.

Results of Operations (unaudited)

                                Three Months Ended June 30, 2012
                                                            Average
                                                 Average     Cash
                                                 Realized    Cost      Average
                                                  Price     (US$'s    Depletion
                                                  (US$'s      Per      (US$'s
                  Ounces    Ounces    Sales        Per      Ounce)       Per
               Produced [2]  Sold    (US$'s)      Ounce)      [3]      Ounce)
    Silver
    San Dimas
    [4]               1,227  1,295    $  36,695    $ 28.34    $ 4.09     $  0.79
    Zinkgruvan          673    580       16,505      28.45      4.14        1.68
    Yauliyacu           606  1,155       34,468      29.84      4.08        5.02
    Peñasquito        1,822  1,845       53,197      28.83      3.99        2.96
    Cozamin             429    395       11,981      30.33      4.12        4.05
    Barrick
    [5]                 468    470       14,183      30.18      3.90        4.34
    Other [6]         1,276  1,049       30,665      29.22      3.97        4.09
                      6,501  6,789    $ 197,694    $ 29.12    $ 4.04     $  3.12
    Gold
    Minto             3,214  2,369        3,714      1,568       303         171
    Silver
    equivalent
    [7]               6,690  6,928    $ 201,408    $ 29.07    $ 4.06     $  3.12
    Corporate
    General and administrative
    Other
    Total
    corporate
                      6,690  6,928    $ 201,408    $ 29.07    $ 4.06     $  3.12
                                                            


Table continues

    Three Months
    Ended June 30,
    2012
                                                           Cash Flow
                                          Net                 From
                                       Earnings           Operations      Total Assets
                                        (US$'s)             (US$'s)          (US$'s)
    Silver
    San Dimas [4]               $        30,367          $    31,394   $     165,161
    Zinkgruvan                           13,131               14,043          55,798
    Yauliyacu                            23,959               32,202         221,723
    Peñasquito                           40,373               45,835         495,993
    Cozamin                               8,756               10,400          21,997
    Barrick [5]                          10,310               13,571         601,035
    Other [6]                            22,212               27,670         243,642
                                $       149,108          $   175,115   $   1,805,349
    Gold
    Minto                                 2,593                2,928          32,596
    Silver
    equivalent [7]              $       151,701          $   178,043   $   1,837,945
    Corporate
    General and
    administrative              $       (7,354)
    Other                               (2,933)
    Total
    corporate                   $      (10,287)          $   (5,127)   $   1,218,880
                                $       141,414          $   172,916   $   3,056,825
 



 

1)     All figures in thousands except gold ounces produced and sold and per ounce amounts.
2)     Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Production figures are based on information provided by the operators of the mining operations to which the silver or gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
3)     Refer to discussion on non-IFRS measures at the end of this press release.
4)     Results for San Dimas include 375,000 ounces received from Goldcorp in connection with Goldcorp's four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero.
5)     Comprised of the operating Lagunas Norte, Pierina and Veladero silver interests in addition to the non-operating Pascua-Lama silver interest.
6)     Comprised of the operating Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto and Aljustrel silver interests in addition to the non-operating Rosemont silver and gold interest and Loma de La Plata silver interest.
7)     Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver.

                            Three Months Ended June 30, 2011
                                                        Average
                                             Average     Cash
                                             Realized    Cost
                                              Price     (US$'s     Average
                Ounces                        (US$'s      Per     Depletion
               Produced Ounces    Sales        Per      Ounce)   (US$'s Per
                 [2]     Sold    (US$'s)      Ounce)      [3]      Ounce)
    Silver
    San Dimas
    [4]           1,150  1,149    $  42,798    $ 37.25    $ 4.05     $  0.71
    Zinkgruvan      414    401       16,220      40.46      4.08        1.69
    Yauliyacu       674    471       17,663      37.50      4.02        5.02
    Peñasquito    1,282    961       39,274      40.89      3.90        2.41
    Cozamin         414    281       10,284      36.58      4.08        4.62
    Barrick
    [5]             741    726       27,437      37.78      3.90        3.57
    Other [6]     1,153    862       32,515      37.71      3.94        4.30
                  5,828  4,851    $ 186,191    $ 38.38    $ 3.98     $  2.84
    Gold
    Minto         6,510  5,674        8,561      1,509       300         169
    Silver
    equivalent
    [7]           6,089  5,078    $ 194,752    $ 38.35    $ 4.14     $  2.90
    Corporate
    General and
    administrative
    Other
    Total
    corporate
                  6,089  5,078    $ 194,752    $ 38.35    $ 4.14     $  2.90


Table continues

    Three Months
    Ended June 30,
    2011
                                                        Cash Flow
                                        Net                From
                                     Earnings          Operations     Total Assets
                                      (US$'s)             (US$'s)         (US$'s)
    Silver
    San Dimas [4]              $      37,333          $    38,149  $     169,458
    Zinkgruvan                        13,905               13,303         58,899
    Yauliyacu                         13,406               15,770        233,355
    Peñasquito                        33,215               35,528        510,351
    Cozamin                            7,838               10,798         28,394
    Barrick [5]                       22,009               24,605        599,449
    Other [6]                         25,415               29,105        260,447
                               $     153,121          $   167,258  $   1,860,353
    Gold
    Minto                              5,897                5,941         35,362
    Silver
    equivalent [7]             $     159,018          $   173,199  $   1,895,715
    Corporate
    General and
    administrative             $     (6,252)
    Other                            (4,701)
    Total
    corporate                  $    (10,953)          $   (4,918)  $     911,631
                               $     148,065          $   168,281  $   2,807,346
 


1)     All figures in thousands except gold ounces produced and sold and per ounce amounts.
2)     Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Production figures are based on information provided by the operators of the mining operations to which the silver or gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
3)     Refer to discussion on non-IFRS measure at the end of this press release.
4)     Results for San Dimas include 375,000 ounces received from Goldcorp in connection with Goldcorp's four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero.
5)     Comprised of the operating Lagunas Norte, Pierina and Veladero silver interests in addition to the non-operating Pascua-Lama silver interest.
6)     Comprised of the operating Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto and Aljustrel silver interests in addition to the non-operating Rosemont silver and gold interest and Loma de La Plata silver interest.
7)     Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver.

                                   Six Months Ended June 30, 2012
                                                        Average
                                             Average     Cash
                                             Realized    Cost      Average
                                              Price     (US$'s    Depletion
                Ounces                        (US$'s      Per      (US$'s
               Produced Ounces    Sales        Per      Ounce)       Per
                 [2]     Sold    (US$'s)      Ounce)      [3]      Ounce)
    Silver
    San Dimas
    [4]           2,919  2,996    $  92,261    $ 30.79    $ 4.09     $  0.79
    Zinkgruvan    1,315  1,097       33,443      30.47      4.14        1.68
    Yauliyacu     1,156  1,652       50,054      30.30      4.06        5.02
    Peñasquito    3,187  3,034       91,957      30.31      3.99        2.96
    Cozamin         834    771       24,590      31.91      4.10        4.05
    Barrick
    [5]           1,135  1,126       35,686      31.70      3.90        4.34
    Other [6]     2,564  2,041       62,865      30.79      3.96        4.04
                 13,110 12,717    $ 390,856    $ 30.73    $ 4.03     $  2.97
    Gold
    Minto         5,302  6,229       10,190      1,636       303         171
    Silver
    equivalent
    [7]          13,406 13,054    $ 401,046    $ 30.72    $ 4.07     $  2.97
    Corporate
    General and
    administrative
    Other
    Total
    corporate
                 13,406 13,054    $ 401,046    $ 30.72    $ 4.07     $  2.97


Table continues

    Six Months Ended June
    30, 2012
                                                          Cash Flow
                                        Net                From
                                     Earnings             Operations  Total Assets
                                      (US$'s)               (US$'s)     (US$'s)
    Silver
    San Dimas [4]                $     77,634       $       79,999 $   165,161
    Zinkgruvan                         27,058               27,538      55,798
    Yauliyacu                          35,055               45,790     221,723
    Peñasquito                         70,873               79,853     495,993
    Cozamin                            18,313               20,540      21,997
    Barrick [5]                        26,410               32,517     601,035
    Other [6]                          46,531               54,722     243,642
                                 $    301,874       $      340,959 $ 1,805,349
    Gold
    Minto                               7,240                8,077      32,596
    Silver
    equivalent [7]               $    309,114       $      349,036 $ 1,837,945
    Corporate
    General and
    administrative               $   (14,918)
    Other                             (5,601)
    Total corporate              $   (20,519)       $     (12,309) $ 1,218,880
                                 $    288,595       $      336,727 $ 3,056,825
 


1)     All figures in thousands except gold ounces produced and sold and per ounce amounts.
2)     Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Production figures are based on information provided by the operators of the mining operations to which the silver or gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
3)     Refer to discussion on non-IFRS measure at the end of this press release.
4)     Results for San Dimas include 750,000 ounces received from Goldcorp in connection with Goldcorp's four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero.
5)     Comprised of the operating Lagunas Norte, Pierina and Veladero silver interests in addition to the non-operating Pascua-Lama silver interest.
6)     Comprised of the operating Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto and Aljustrel silver interests in addition to the non-operating Rosemont silver and gold interest and Loma de La Plata silver interest.
7)     Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver.

                                             Six Months Ended June 30, 2011
                                                        Average
                                             Average     Cash
                                             Realized    Cost      Average
                                              Price     (US$'s    Depletion
                Ounces                        (US$'s      Per      (US$'s
               Produced Ounces    Sales        Per      Ounce)       Per
                 [2]     Sold    (US$'s)      Ounce)      [3]      Ounce)
    Silver
    San Dimas
    [4]           2,756  2,897    $ 101,169    $ 34.92    $ 4.05     $  0.71
    Zinkgruvan      922    722       27,269      37.76      4.08        1.69
    Yauliyacu     1,357    591       21,186      35.85      4.01        5.02
    Peñasquito    2,489  1,902       66,294      34.87      3.90        2.41
    Cozamin         739    552       18,935      34.26      4.06        4.62
    Barrick
    [5]           1,463  1,406       49,100      34.91      3.90        3.56
    Other [6]     2,241  1,603       56,542      35.27      3.93        4.14
                 11,967  9,673    $ 340,495    $ 35.20    $ 3.98     $  2.59
    Gold
    Minto         9,435  8,198       12,440      1,517       300         169
    Silver
    equivalent
    [7]          12,325  9,983    $ 352,935    $ 35.35    $ 4.10     $  2.65
    Corporate
    General and
    administrative
    Other
    Total
    corporate
                 12,325  9,983    $ 352,935    $ 35.35    $ 4.10     $  2.65


Table continues

    Six Months Ended June
    30, 2011
                                                          Cash Flow
                                        Net                From
                                      Earnings            Operations  Total Assets
                                       (US$'s)             (US$'s)      (US$'s)
    Silver
    San Dimas [4]                $     87,384       $       88,351 $   169,458
    Zinkgruvan                         23,100               22,909      58,899
    Yauliyacu                          15,850               18,815     233,355
    Peñasquito                         54,301               58,880     510,351
    Cozamin                            14,136               18,573      28,394
    Barrick [5]                        38,604               42,056     599,449
    Other [6]                          43,601               49,290     260,447
                                 $    276,976       $      298,874 $ 1,860,353
    Gold
    Minto                               8,595                8,811      35,362
    Silver
    equivalent [7]               $    285,571       $      307,685 $ 1,895,715
    Corporate
    General and
    administrative               $   (12,754)
    Other                             (2,576)
    Total corporate              $   (15,330)       $     (12,208) $   911,631
                                 $    270,241       $      295,477 $ 2,807,346
 


1)     All figures in thousands except gold ounces produced and sold and per ounce amounts.
2)     Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions. Production figures are based on information provided by the operators of the mining operations to which the silver or gold interests relate or management estimates in those situations where other information is not available. Certain production figures may be updated in future periods as additional information is received.
3)     Refer to discussion on non-IFRS measures at the end of this press release.
4)     Results for San Dimas include 750,000 ounces received from Goldcorp in connection with Goldcorp's four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero.
5)     Comprised of the operating Lagunas Norte, Pierina and Veladero silver interests in addition to the non-operating Pascua-Lama silver interest.
6)     Comprised of the operating Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto and Aljustrel silver interests in addition to the non-operating Rosemont silver and gold interest and Loma de La Plata silver interest.
7)     Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver.

Non-IFRS Measures

Silver Wheaton has included, throughout this document, certain non-IFRS performance measures, including (i) average cash costs of silver and gold on a per ounce basis; (ii) operating cash flow per share (basic and diluted); and (iii) cash operating margin.

          i. Average cash cost of silver and gold on a per ounce basis is
          calculated by dividing the total cost of sales, less depletion, by
          the ounces sold. In the precious metals mining industry, this is a
          common performance measure but does not have any standardized
          meaning. The Company believes that, in addition to conventional
          measures prepared in accordance with IFRS, certain investors use
          this information to evaluate the Company's performance and ability
          to generate cash flow.
 
          ii. Operating cash flow per share (basic and diluted) is calculated
          by dividing cash generated by operating activities by the weighted
          average number of shares outstanding (basic and diluted). The
          Company presents operating cash flow per share as it believes that
          certain investors use this information to evaluate the Company's
          performance in comparison to other companies in the precious metals
          mining industry who present results on a similar basis.
 
          iii. Cash operating margin is calculated by subtracting the average
          cash cost of silver and gold on a per ounce basis from the average
          realized selling price of silver and gold on a per ounce basis. The
          Company presents cash operating margin as it believes that certain
          investors use this information to evaluate the Company's performance
          in comparison to other companies in the precious metals mining
          industry who present results on a similar basis.


These non-IFRS measures do not have any standardized meaning prescribed by IFRS, and other companies may calculate these measures differently. The presentation of these non-IFRS measures is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For more detailed information, please refer to pages 19 to 21 of Silver Wheaton's Management Discussion and Analysis available on the Company's website at http://www.silverwheaton.com and posted on SEDAR at http://www.sedar.com.


   

For further information:

Brad Kopp
Senior Vice President, Investor Relations
Silver Wheaton Corp.
Tel: 1-800-380-8687
Email: info@silverwheaton.com
Website: http://www.silverwheaton.com

(SLW. SLW)

SOURCE Silver Wheaton Corp.



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