Endeavour Silver - CEO, Bradford Cooke
CEO, Bradford Cooke
Sourced: The Northern Miner
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  • Endeavour Silver (TSX:EDR) has posted some underwhelming results for the quarter ending March 31, 2020
  • Both production and financial figures dropped across the board, including a 22 per cent decline in revenue and a 20 per cent increase in net loss
  • The company attributed these results largely to a drop in silver production and a 25 per cent devaluation of the Mexican peso
  • With operational suspensions now mostly lifted, the company plans to move its mines back to production during May
  • Endeavour Silver (EDR) is currently up 0.99 per cent to $2.04 per share, with a market cap of $285.71 million

Endeavour Silver (TSX:EDR) has posted some underwhelming results for the quarter ending March 31, 2020.

The mid-tier precious metals company owns and operates three high-grade, underground silver-gold mines in Mexico. Currently, it is focused on advancing its Terronera project towards a development decision, as well as expanding its portfolio of exploration opportunities.

Like many mining companies around the world, Endeavour’s production was hit by government-mandated shutdowns in an effort to curb the spread of COVID-19. As a result, both production and financial figures dropped across the board for the first quarter of 2020.

Total revenue fell 22 per cent from C$39 million in 2019 to $30.5 million this year. The company said that this was the result of an 18 per cent decline in silver equivalent production due to the suspension of operations at its El Cubo mine.

While this was partially offset by an increase in gold prices, the drop in production also led to similar declines in operating cash flows and EBITDA in comparison to last year.

Similarly, net loss increased from $18.53 million in 2019 to $22.15 million. Almost half of this was attributable to a 25 per cent devaluation of the Mexican peso, which negatively affected the company’s receivables and caused a deferred income tax expense.

Bradford Cooke, CEO of Endeavour Silver, commented in the challenging period.

“Other extraordinary items included elevated care and maintenance costs at El Cubo which will decline going forward, and high mine depletion due to short reserve lives.

“Since the Mexican government has decreed that suspended businesses located in municipalities with low or no COVID-19 cases can start up again May 18, and each of our three mines are located in such municipalities, we are looking forward to putting our mines back into production in May,” he added.

While the company’s activities are beginning to return to normal levels, no indication was given as to how the COVID-19 pandemic might impact Endeavour’s performance in the second quarter of the year. As such, a revised outlook has not yet been provided.

Endeavour Silver (EDR) is currently up 0.99 per cent to $2.04 per share at 2:00pm EDT.

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