15th Jan 2020 08:33
(Alliance News) - Hochschild Mining PLC on Wednesday reported a mixed performance in the final quarter of 2019 and guided for a further production decline in the year ahead.
The FTSE 250-listed silver and gold producer said its gold production was 78,050 ounces in the three months to the end of 2019, down 4.1% compared to 81,370 ounces mined in the prior quarter, but up 6.8% from 73,100 ounces produced a year ago. This was driven by a "better than expected" performance from the Inmaculada mine in Cusco, Peru.
In terms of silver, production in the fourth quarter was 12% lower, at 4.6 million ounces, versus 5.3 million delivered in the third quarter of 2019. Year-on-year, silver output slipped even more, by 20%.
In February last year Hochschild suspended its operations at Arcata mine, located in the south of Peru, and subsequently placed it on temporary care and maintenance. There was consequently no output in the second half of 2019.
Overall 2019 production was 570,500 gold equivalent ounces and 46.2 million silver equivalent ounces, both down 3.0% year-on-year.
Looking ahead, Hochschild gave production guidance for 2020 of 422,000 gold equivalent ounces and 36.0 million silver equivalent ounces. The company did not explain the reasons for expected continued fall in output.
Turning to prices, the miner said average realisable precious metal prices in the final quarter of 2019 were USD1,492 per ounce for gold and USD17.7 per ounce for silver, higher than USD1,263 and USD15.2, respectively, a year ago.
For 2019, average realisable precious metal prices were USD1,414 an ounce for gold and USD16.5 an ounce for silver compared to USD1,268 and USD15.3, respectively, in 2018.
"I am pleased to report that we have delivered a stronger than forecast final quarter," said Chief Executive Ignacio Bustamante. "Furthermore, our costs for 2019 are expected to be in line with guidance."
Hochschild shares were trading 5.0% higher in London on Wednesday morning at 172.34 pence each.
By Evelina Grecenko; [email protected]
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