FULL DISCLOSURE: This is sponsored content for First Majestic Silver Corp.
First Majestic Silver (TSX: AG) (NYSE: AG) saw record free cash flow in the fourth quarter of 2024, thanks in part to a higher realized silver price per silver equivalent ounce amid a precious metals bull market.
Free cash flow for the quarter hit $68.4 million, which amounted to a 119% jump on a quarter over quarter basis. The performance was driven not only by higher metals pricing, but also operating efficiencies that drove the cost of production lower.
First Majestic in the fourth quarter reported revenues of $172.3 million, which was an 18% improvement on a quarter over quarter basis, a result of the average realized silver price per silver equivalent ounce climbing to $30.80. This lead to mine operating earnings improving 69% to $48.2 million.
Notably, First Mint (the company’s own minting facility) also had a strong quarter, reporting record quarterly sales of $9.1 million in only its third quarter of operations. The figure represents a 237% increase from $2.7 million in sales recorded in the prior quarter.
While the company posted a net loss in the fourth quarter of $13.5 million (mostly driven by non-cash foreign exchange and deferred income tax charge), or $0.04 per share, it was a 49% improvement over the $26.6 million loss recorded in the third quarter. On an adjusted basis, net earnings improved to $7.6 million, or $0.03 per share. Adjusted EBITDA during the quarter meanwhile totaled $64.8 million, a 63% improvement over the $39.8 million recorded in the prior quarter.
For the full fiscal year, First Majestic posted revenues of $560.6 million, while mine operating earnings increased to $91.9 million, a 259% bump from the $25.6 million figure recorded in 2023. Operating cash flows before working capital and taxes improved 40% year over year to $138.6 million.
Adjusted net earnings for the full fiscal year came in at a loss of $41.8 million, or $0.14 per share, as compared to a loss of $23.8 million, or $0.08 per share in 2023.
The financial performance led to First Majestic ending the year with a strengthened cash position of $308.3 million, which includes restricted cash, an improvement from the $251.2 million held at the start of the year. Working capital improved 19% to $224.5 million, while as of the end of the quarter the company had total liquidity of $364.2 million.
Share buybacks also began in December, with First Majestic repurchasing 50,000 shares in the fourth quarter. As per CEO Keith Neumeyer, the share buyback program continued through January and February, and will continue throughout 2025.
WATCH: First Majestic Finalizes The Gatos Silver Purchase – Full Breakdown
From an operational perspective, the fourth quarter saw the company produce 5.7 million silver equivalent ounces. Cash costs declined 9% to $13.82 an ounce, while all in sustaining costs were down 3% to $20.34 an ounce.
Annual production and cost guidance was also achieved, with First Majestic in 2024 producing 21.7 million silver equivalent ounces at an average all in sustaining cost of $21.11. Guidance had called for production of 21.1 to 23.5 million silver equivalent ounces.
Looking to 2025, First Majestic has guided to record production levels of 27.8 to 31.2 million silver equivalent ounces following the acquisition of Cerro Los Gatos. Cash costs are expected to be in a range of $14.10 to $14.86 per silver equivalent ounce, while AISC is expected to fall to a range of $18.17 to $19.35 per ounce.
First Majestic Silver last traded at $8.15 on the TSX, up over 6% on the day.
FULL DISCLOSURE: First Majestic Silver Corp. is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of First Majestic Silver Corp. The author has been compensated to cover First Majestic Silver Corp. on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.
