Guanajuato Silver (TSXV: GSVR) this morning released the results of their third quarter, posting topline revenue of $16.3 million, down 12% from the second quarter.
Revenue in the second quarter follows the sale of 521,919 silver equivalent ounces at an average realized price of $39.03 per ounce. Silver equivalent sales were down 19% from 648,313 ounces in the second quarter, although this decline was partially offset by the average realized price of silver climbing 16% from $33.58 in Q2.
While revenues may have been down, cost of sales was up, jumping 18% quarter over quarter to $17.8 million, leading to mine operating income turning negative, moving from positive $3.4 million in the second quarter to a loss of $1.5 million in Q3. Further expenditures, including G&A of $2.3 million and a loss on derivatives of $2.0 million led to Guanajuato posting a net loss of $5.8 million, or $0.01 per share, as compared to a loss of $2.9 million, or $0.01 per share in the second quarter.
EBITDA also deteriorated over the course of the quarter, moving from negative $0.4 million to negative $4.6 million, while on an adjusted basis, EBITDA moved from positive $1.9 million to negative $2.2 million.
In terms of cash flow, cash flow from operating activities declined from $1.7 million to $0.7 million. One bright spot from a financial perspective was Guanajuato’s cash position, which moved from $1.9 million to $11.6 million over the course of the quarter, thanks in part to a funding round. This led to working capital improving from negative $6.7 million to positive $5.4 million on a quarter over quarter basis.
The other positive here, is that substantial funds are said to have been spent on capital expenditures that are expected to generate efficiencies in 2026. Capital expenditures totaled $1.5 million, with those funds spent on improvements to the mining fleet, relining of Mill 3 at El Cubo, the installation of a Falcon gravity concentrator at Topia, pre-development work at Pinguico, and dewatering efforts at Valenciana and El Cubo.
“Since purchasing our first mine in 2021, this was the first quarter where we have had sufficient capital to fully fund development, exploration and vital infrastructure improvements. The funding has allowed us to make the necessary adjustments and upgrades that will have Guanajuato Silver on-track and poised to generate prolonged success at all our producing Mexican mining assets,” commented James Anderson, CEO of Guanajuato Silver.
In terms of operations, Guanajuato in the second quarter produced a total of 457,525 silver equivalent ounces, a decline of 31% quarter over quarter from 659,237 ounces in Q2.
Cash costs meanwhile jumped 48%, moving from $21.67 to $32.10 an ounce, while AISC moved from $26.38 to $40.64 an ounce, a 54% increase.
Guanajuato Silver last traded at $0.49 on the TSX Venture.
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