20th Jan 2021 10:31
(Alliance News) - Hochschild Mining PLC on Wednesday said its output for 2020 declined considerably due to lower grades from all its operational mines, but expects to report an improvement in production for 2021.
The FTSE 250-listed miner said that, for the three months to the end of December, gold production was 65,670 ounces, a 16% drop from the 78,050 ounces the same period the year before. Also, silver output fell by 20% year-on-year to 3.72 million ounces from 4.64 million ounces.
This was due to lower average gold and silver grades mined from the Immaculada mine in Cusco, Peru due to delays in mine sequencing resulting from stoppages.
Grades from the Pallancata mine in Peru were lower as well, due to revisions in the mining plan, while San Jose in Argentina suffered from stoppages and continued restrictions on movement.
For 2020 as a whole, gold output declined by 36% to 207,080 ounces from 321,580 ounces the prior year, while silver production dropped by 41% year-on-year to 11.82 million ounces from 20.16 million ounces.
Annual gold equivalent production dropped substantially by 38% to 344,540 ounces from 556,030 ounces the year before, while silver equivalent output also fell by 38% year-on-year to 29.63 million ounces from 47.82 million ounces.
Looking ahead, Hochschild Mining has set a production target for 2021 of gold equivalent output between 360,000 to 372,000 ounces, a 4.5% to 8.0% rise from 2020's figure. Meanwhile, silver equivalent output is guided to be between 31.0 million to 32.0 million ounces, up 4.6% to 8.0% from the year before.
"Our balance sheet is now in a net cash position following another period of substantial free cashflow generation driven by our strong operational performance and ongoing favourable precious metal prices. Finally, our brownfield programme continues to advance with Inmaculada expected to increase reserves significantly and encouraging new drill results achieved at Arcata, San Jose and Corina," said Chief Executive Officer Ignacio Bustamante.
Shares in Hochschild Mining were up 8.0% at 209.12 pence on Wednesday in London.
By Dayo Laniyan; [email protected]
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