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Thursday, July 20, 2017 Derek Macpherson

EXN's Q2 2017 Production Improves Post Optimization

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Excellon Resources Inc. (TSX:EXN) reported positive Q2 2017 production results, subsequent to the completion of its optimization plan at its Platosa Mine in Durango, Mexico (Figure 1). In mid-June, the company achieved dry mining conditions the initial benefits of which were scene in Q2 results. In Q2 production increased in all metals, silver (~49%), lead (~39%) and zinc (~28%) as compared to Q1 2017. We expect the remainder of the year to be strong, as the company should be able to ramp up production. read more


Thursday, July 13, 2017 Derek Macpherson

EXN Ramps Up Under Dry Mining Conditions

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Excellon Resources Inc. (TSX:EXN) has successfully completed its optimization plan for its Platosa Mine in Durango, Mexico. Drier mining conditions allow the company to ramp up production rates and access the higher grades in the Rodilla and Guadalupe South Mantos. We expect to see a stronger H2 2017 as cash flow and profitability should improve materially. The company is planning to produce from six faces (Q3), and access the 623 Manto in the near term, more details are pending. Excellon currently trades at a premium to peers at 8.2x 2017e EV/CF versus peers at 6.6x 2017e EV/CF. We believe this premium only partially reflects the increased production and lower costs expected now that the optimization program is completed at Platosa. read more


Thursday, May 11, 2017 Derek Macpherson

EXN's Costs Increase as Optimization Nears Completion

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Excellon Resources Inc. (TSX:EXN) reported weak Q1 2017 financials, as the company entered a period of increased spending supporting the ongoing optimization at its Platosa mine in Durango, Mexico. Due to challenging mining conditions and focus on optimization, production costs increased significantly QoQ by 11.19% (23.13% YoY). The optimization plan is 90% completed and water levels are lowering at a faster rate than initially forecasted. We expect to see a stronger H2 2017 as cash flow and profitability should improve materially. Excellon currently trades at a premium to peers at 1.22x NAV and 6.3x 2017e EV/CF versus peers at 0.87x NAV and 6.0x 2017e EV/CF. We believe this premium only partially reflects the increased production and lower costs expected once the optimization program is completed at Platosa.  read more


Thursday, April 27, 2017 Derek Macpherson

EXN's Optimization Plan On-Track

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Excellon Resources Inc. (TSX:EXN) reported Q1 2017 production results and an update on its ongoing optimization program at its Platosa Mine in Durango, Mexico. The optimization plan remains on schedule for the end of Q2. The company saw higher than forecasted drawdown and expects full installation to be completed during May. Production results decreased significantly YoY and QoQ, as the company faced challenging mining conditions in the Rodilla Manto during Q1. Operations and cash flow are expected to improve in H2 2017, once the optimization program has been completed. Excellon currently trades at a premium to peers, we believe this premium partially reflects the expected increase in production and lower costs once the optimization program is completed. read more


Thursday, March 23, 2017 Derek Macpherson

EXN's Optimization Program Nearing Completion

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Excellon Resources Inc. (TSX:EXN) reported financial results for Q4 2016 and 12-months ended 2016 including an update on its ongoing optimization program at its Platosa Mine in Durango, Mexico. Costs for Q4 were much higher than the expected run-rate; however, this incorporates costs of the ongoing optimization program. The company anticipates operations to achieve higher rates of production and lower costs during H2 2017, when the optimization program is complete. While Excellon currently trades at a premium to peers; we believe this reflects the market's anticipation for improved production and costs later this year.  read more


Sunday, February 26, 2017 Derek Macpherson

RCKS Pre-PDAC Mining Showcase Presenter Preview

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On Friday March 3th, 2017, Red Cloud Klondike Strike Inc. will be hosting its 5th Annual Pre-PDAC Mining Showcase. The event features presentations from 21 companies, including a themed lunch presentation by leading corporations in the gold mining sector. Visit the event page for more details on the day’s schedule. In this post, we provide a brief preview on the 21 presenting companies and 13 banner sponsors that will also be in attendance.  read more


Wednesday, February 08, 2017 Derek Macpherson

EXN Materially Reduces TC/RCs

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Yesterday, Excellon Resources Inc. (TSX:EXN) announced it had entered into new off-take purchase agreements for 2017 lead-silver and zinc concentrate production, likely representing a ~60% reduction in treatment and refining charges (TC/RCs). We expect this to positively benefit Excellon’s profitability since TC/RCs for the first nine months of 2016 were US$2.7 million or ~17% of gross sales. If we were to apply this discount to the first nine months of 2016, revenue would have increased ~12%, adjusted net income would go from being a loss to slightly positive and operating cash flow would be about breakeven, versus a meaningful loss. Coupled with the completion of the company’s optimization program which is slated for Q1 2017, we expect cash flow and profitability to improve materially in H2 2017. Excellon currently trades at a premium to peers at 1.67x NAV and 14.0x 2017e EV/CF versus peers at 1.10x NAV and 9.2x 2017e EV/CF. We believe this premium partially reflects the increased production and lower costs expected once the optimization program is completed at La Platosa. read more


Thursday, February 02, 2017 Derek Macpherson

EXN Discovers New Zones Above the Water Table

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Excellon Resources Inc. (TSX:EXN) announced additional results from its ongoing 25 km drill program at its La Platosa mine in Mexico. To date 35 holes totalling 5.4km have been completed and the program is focused on expanding and better defining the existing resource, along with testing new near-infrastructure areas above the water table. Today’s results were highlighted by the discovery of three new mineralized zones above the water table, which are likely to benefit operations in the near-term. As well, hole EX16LP1107 intersected 795 g/t Ag, 25.85% Zn and 9.25% Pb over 3.0m and appears to have expanded the Pierna Manto to the North and the Rodilla Manto to the South. Excellon currently trades at a premium to peers on a NAVPS and 2017e EV/CF basis which likely reflects the expected cost and production improvements from the ongoing optimization program. read more


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