Wheaton Records US$1.20 Billion In Revenue In 2021

It seems that diversifying its portfolio proves to be working for Wheaton Precious Metals Corp. (TSX: WPM). The firm released on Thursday its Q4 and 2021 financial results, highlighting US$1.20 billion in annual revenue, up from 2020’s US$1.10 billion.

The annual sales came from selling 663,415 gold equivalent ounces for the year, marginally up from 662,275 ounces last year. The increase, however, is primarily due to a 9% increase in average realized gold equivalent price.

Gold equivalent ounces are based on the following base case prices: US$1,800 per gold ounce, US$25 per silver ounce, US$2,300 per palladium ounce, and US$17.75 per cobalt pound.

But looking at the breakdown of the metals sold, the acquired cobalt stream at Voisey’s Bay–which started in January 2021–contributed to the push to a higher topline figure. On a year-on-year basis, while the firm sold 15.4% fewer gold ounces and 3.5% fewer palladium ounces, this was offset by an 18.9% increase in silver ounces sold and the contribution of the newly acquired cobalt stream.

Units sold20212020
Gold ounces312,465369,553
Silver ounces22,86019,232
Palladium ounces19,34420,051
Cobalt pounds886
Gold equivalent ounces663,415662,275

In terms of production, the firm had an attributable annual gold equivalent production of 752,958 ounces for 2021, up from 2020’s 712,624 ounces and meeting the guidance of 735,000 – 765,000 ounces. While the firm recorded lower gold and palladium production, this was offset by the increase in silver production and the new cobalt stream, as well.

The gross margin for the year rose to 54.8% coming from 53.4% last year. Further down the financials, the company recorded US$754.9 million in net earnings, a jump from last year’s US$507.8 million. This also translated to US$1.67 earnings per share.

For Q4 2021, the firm earned US$278.2 million, up from Q3 2021’s US$269.0 million but down from Q4 2020’s US$286.2 million. This comes from selling 158,864 gold equivalent ounces, both up from 152,432 ounces last quarter and 155,665 ounces last year. The company said that the year-on-year decrease in quarterly revenue is partly due to the lower average realized gold equivalent price.

The company also had lower production of 186,404 gold equivalent ounces in Q4 2021 compared to 189,682 ounces in Q4 2020, but higher than 184,918 ounces in Q3 2021.

The firm also recorded quarterly net earnings higher than its revenue this quarter, mainly due to a US$156.7 million impairment reversal at its cobalt interest in Voisey’s Bay. The quarterly net earnings came in at US$291.8 million compared to US$134.9 million last quarter and US$157.2 million last year. Calibrating this for financial items, adjusted earnings for the quarter came in at US$132.2 million, down from last quarter’s US$134.9 million and last year’s US$149.4 million.

Operating cash flow generated for the year came in at US$845.1 million, leading the firm to end the year with a cash and cash equivalents balance of US$226.0 million. Current assets ended at US$249.7 million while current liabilities ended at US$29.7 million.

For 2022, the firm is estimating attributable production to be 700,000 – 760,000 gold equivalent ounces. This is expected to increase to 850,000 ounces in 2026 and 910,000 ounces in 2031.

The firm also announced in January 2022 a new purchase agreement for Generation Mining Limited’s Marathon project for a gold and platinum stream, adding another precious metal to its portfolio.

Wheaton Precious Metals last traded at $62.75 on the TSX.

Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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