TSX: SIL | NYSE American: SILV
VANCOUVER, BC, Nov. 15, 2021 /CNW/ - SilverCrest Metals
Inc. ("SilverCrest" or the "Company") is pleased to report the
Company's unaudited financial results for the third quarter of 2021
("Q3, 2021"). The unaudited condensed consolidated interim
financial statements and management's discussion and analysis
("MD&A") for the three and nine months ended September 30, 2021 are available under the
Company's SEDAR profile on www.sedar.com or on SilverCrest's
website www.silvercrestmetals.com. All amounts herein are presented
in United States Dollars, unless
otherwise stated.
The Company's top priority is on the high-grade, historic Las
Chispas mining district in Sonora,
Mexico, where it has completed a feasibility study (the
"Feasibility Study") on the Las Chispas Project. Details of
the Feasibility Study, including an updated Mineral Resource
Estimate and an initial Mineral Reserve Estimate, are provided in a
technical report filed under the Company's SEDAR profile entitled,
"NI 43-101 Technical Report & Feasibility Study on the Las
Chispas Project" with an effective date of January 4, 2021 (the "Technical Report").
Las Chispas Highlights –September 30, 2021
- Construction Remains on Schedule – At the end of Q3,
2021, overall construction progress at Las Chispas was 54% complete
compared to an overall scheduled completion of 48%. Construction
continued to progress well in the quarter with the main access
road, plant detailed engineering, and concrete work now complete,
bridge construction 88% complete, plant construction 49% complete,
powerline 47% complete, and underground infrastructure ongoing.
Construction progress continued to benefit from no delays due to
COVID-19 or any other reason. For further details on Las Chispas
construction, please refer to the Company's news release dated
October 26, 2021.
- Capital Spend Tracking Well Against Budget – Through Q3,
2021, 68% of the $137.7 million
Feasibility Study capital cost estimate was committed, of which 57%
has been incurred across all capital cost categories, in-line with
budget. At the end of Q3, 2021, approximately $59.0 million in capital remains to be incurred
through commissioning. A number of key infrastructure tasks are now
complete or nearing completion, limiting cost inflation risk.
- Underground Development Ahead of Schedule – With
underground development ahead of schedule at the end of the first
half of 2021, development rates continued to progress well in Q3,
2021 for a total of 15.7 km completed since underground development
began in Q1, 2019. At the end of Q3, 2021, unit underground mining
costs continue to track slightly under budget and development
metres remain well ahead (1.6 km) of the Feasibility Study
budget.
- Site Safety Remains Key Priority – At the end of Q3,
2021, after 1.33 million work-hours completed at site, the
Company's lost time injury frequency rate was 0.60. COVID-19 risk
mitigation efforts continued successfully in the quarter with an
additional 4,800 COVID-19 tests completed and positivity rates
remaining low. The Company also participated in a local vaccination
program to complement the federal program. This local program
allowed for full vaccination of 220 employees and contractors and
first dose vaccination of an additional 110 employees and
contractors.
- Drill Program at Las Chispas – During the nine months
ended September 30, 2021, the Company
completed 104,804 metres of drilling, with 65% of these metres
focused on infill drilling of Inferred resources to support
conversion to Indicated resources for potential conversion to
Mineral Reserves. Infill drilling has focused on areas proximal to
planned underground infrastructure which could be considered for
mining early in the life of mine plan. Results for this drilling
are being compiled and are expected to be released in Q4, 2021.
Completion of an updated Mineral Resource and Reserve estimate,
using these results, is targeted for release in 2022. As of
October 31, 2021, there were nine
drill rigs (seven on surface and two underground) active at Las
Chispas and expectations are for a reduction in drill rigs during
Q4, 2021 to create onsite camp capacity for construction personnel,
which will be at a peak.
Corporate Highlights - September 30,
2021
- Funded for Construction, Near-Term Cash Flow – As at
October 31, 2021, SilverCrest had
cash and cash equivalents of $172.0
million (September 30, 2021 -
$199.0 million) and $60.0 million (September
30, 2021 - $60.0 million)
remaining under a $120.0 million
project financing facility (the "Credit Facility"). Once fully
operational and using Base Case metal prices ($1,500/oz Au and $19.00/oz Ag), which are approximately 15% and
21% (respectively) below prices as of October 31, 2021, the Feasibility Study estimated
after-tax project free cash flow of approximately $160.0 million in 2023 and an estimated average
of $110.0 million per year from 2023
to 2029. With more than 80% of the initial capital costs expected
to be committed by the end of 2021, SilverCrest expects to be well
funded for commissioning and ramp-up in 2022, while still retaining
the flexibility to pursue continued exploration, further
optimization work, and growth opportunities.
- Equity Grants – During the nine months ended
September 30, 2021, the Company
granted 908,500 stock options to officers, employees, and
contractors with exercise prices ranging from C$9.97 per share to C$10.87. These options expire 5 years from the
date of grant and vest over a 3-year period with 33% vesting after
each of one year, two years, and three years after the grant date,
respectively. In addition, the Company issued a total of 57,000
deferred share units ("DSUs") to directors of the Company. These
stock options and DSUs were issued primarily as part of these
individuals' annual compensation.
- Appointment of Clifford
Lafleur – On July 26,
2021, the Company appointed Clifford
Lafleur as Vice President, Technical Services. Please refer
to SilverCrest's news release dated July 26,
2021.
COVID-19
The Company continues to adjust to the unprecedented COVID-19
conditions. The Company's COVID-19 prevention measures continue to
be critical for construction at Las Chispas. Positivity rates prior
to site access remained low during the nine months ended
September 30, 2021 (below 2%).
Although no serious occurrences have been recorded at site,
subsequent to quarter end, a cluster of COVID infections was
recorded at the Company's satellite offsite camp. The Company has
taken the appropriate measures including further testing of all
employees and contractors, temporary closure of this satellite
off-site camp, extensive cleaning, and review of key protocols. The
main construction camp remains fully operational and, at this
point, there is no expected impact to the construction camp or
related ongoing work. SilverCrest has included some contingency in
the schedule in the case of a COVID-19 outbreak and this remains
unused. Please refer to the MD&A for the three and nine months
ended September 30, 2021 for further
information.
Las Chispas Expenditures
During the nine months ended September
30, 2021, the Company recorded $42.1
million as development expenditures under mineral property,
plant and equipment, for the Las Chispas Project, which primarily
consisted of:
- decline construction and underground working of $17.2 million;
- drilling costs of $9.7
million;
- field and administrative costs of $6.3
million; and
- salaries and remuneration of $3.3
million.
The Company also recorded additions, during the nine months
ended September 30, 2021, of
$60.0 million related to the Las
Chispas Project as mineral property, plant and equipment for
various items which was primarily construction in progress.
El Picacho
("Picacho")
The Company completed 58,898 metres of drilling at Picacho
during the nine months ended September 30,
2021 and incurred a total of $6.9
million for the Picacho property under exploration and
evaluation expenditures during this period. As of September 30, 2021, the Company had drilled an
estimated cumulative 64,719 metres (247 drill holes) since
acquiring the Picacho property in Q3, 2020. As of October 31, 2021, there were three surface rigs
active at El Picacho. Refer to the
Company's news release dated February 24,
2021 for the initial drill results for Picacho. Results for
this drilling are being compiled and will be released in H1,
2022.
Financial Results
At September 30, 2021, the Company
held $199.0 million as cash and cash
equivalents. The primary factors that contributed to the increase
in cash and cash equivalents from December
31, 2020 to September 30, 2021
include $160.7 million generated by
financing activities net of associated costs, including the
completion of a bought deal prospectus offering on February 22, 2021, for $131.4 million, the completion of a second
drawdown on a Credit Facility for $30.0
million and the exercise of stock options. These cash
inflows were primarily offset by $78.3
million paid towards mineral property, plant, and equipment.
Furthermore, the cash inflows were also offset by $20.0 million paid on the Company's operating
activities, which was primarily made up of $6.9 million incurred on the exploration program
at Picacho, $2.7 million paid on
accounts payable and accrued liabilities and $5.3 million paid on net value-added taxes. At
September 30, 2021, the Company had
value-added taxes ("IVA") receivable in Mexico of $17.9
million (December 31, 2020 –
$12.2 million). The Company received
aggregate IVA refunds of $6.1 million
during the nine months ended September 30,
2021.
The Company has financed its operations to date through the
issuance of common shares and debt. The Company currently has no
operations from which to derive revenues. During the nine months
ended September 30, 2021, the Company
incurred a loss of $14.8 million
(nine months ended September 30, 2020
– $42.4 million) and a comprehensive
loss of $11.5 million (nine months
ended September 30, 2020 –
$43.9 million).
The Qualified Person under National Instrument 43-101 Standards
of Disclosure for Mineral Projects for this news release is N.
Eric Fier, CPG, P.Eng, and CEO for
SilverCrest, who has reviewed and approved its contents.
ABOUT SILVERCREST METALS INC.
SilverCrest is a
Canadian precious metals exploration and development company
headquartered in Vancouver, BC,
that is focused on new discoveries, value-added acquisitions and
targeting production in Mexico's
historic precious metal districts. The Company's top priority is on
the high-grade, historic Las Chispas mining district in
Sonora, Mexico, where it has
completed a feasibility study on the Las Chispas Project and is
proceeding with mine construction. Startup of production at the Las
Chispas Mine is targeted for mid-2022. SilverCrest is the first
company to successfully drill-test the historic Las Chispas
Property resulting in numerous high-grade precious metal
discoveries. The Company is led by a proven management team in all
aspects of the precious metal mining sector, including taking
projects through discovery, finance, on time and on budget
construction, and production.
FORWARD-LOOKING STATEMENTS
This news
release contains "forward-looking statements" and "forward-looking
information" (collectively "forward-looking statements") within the
meaning of applicable Canadian and United
States securities legislation. These include, without
limitation, statements with respect to: the strategic plans, timing
and expectations for the Company's construction and exploration
programs at the Las Chispas Project and the start up of production
at the Las Chispas Mine by mid-2022. Such forward-looking
statements or information are based on a number of assumptions,
which may prove to be incorrect. Assumptions have been made
regarding, among other things: impact of the COVID-19 pandemic; the
reliability of mineralization estimates, mining and development
costs, the conditions in general economic and financial markets;
availability of skilled labour; timing and amount of expenditures
related to rehabilitation and drilling programs; and effects of
regulation by governmental agencies. The actual results could
differ materially from those anticipated in these forward-looking
statements as a result of risk factors including: uncertainty as to
the impact and duration of the COVID-19 pandemic; the timing and
content of work programs; results of exploration activities; the
interpretation of drilling results and other geological data;
receipt, maintenance and security of permits and mineral property
titles; environmental and other regulatory risks; project cost
overruns or unanticipated costs and expenses; and general market
and industry conditions. Forward-looking statements are based on
the expectations and opinions of the Company's management on the
date the statements are made. The assumptions used in the
preparation of such statements, although considered reasonable at
the time of preparation, may prove to be imprecise and, as such,
readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date the
statements were made. The Company undertakes no obligation to
update or revise any forward-looking statements included in this
news release if these beliefs, estimates and opinions or other
circumstances should change, except as otherwise required by
applicable law.
N. Eric Fier, CPG,
P.Eng
Chief Executive Officer
SilverCrest
Metals Inc.
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SOURCE SilverCrest Metals Inc.