RCKS talk

Tuesday, March 07, 2017 Derek Macpherson

SMT Likely to Add High Value Tonnage at Bolivar

Download Report

Sierra Metals Inc. (TSX:SMT, BVL:SMT) announced initial drill results from the La Sidra and Bolivar West zones at its Bolivar mine in Mexico. In our view, the good results from the brownfield exploration program suggest the company is likely to deliver on its objective to add high value tonnes and extend mine life at Bolivar. Drilling continues to imply the existence of high grade Au-Ag mineralization at La Sidra. The zone currently extends over 500m along strike and to a depth of 300m while remaining open 2.5km NE-SW along strike and down dip. Results from Bolivar West similarly returned a weighted average grade above the resource grade. Sierra plans to follow-up on strong anomaly zones detected during a recent IP survey at Bolivar West and Bolivar Northwest. In our view, continued exploration success along with ongoing operational improvements at Sierra’s Yauricocha and Bolivar mines is key to enhancing the company’s value and positioning to bring about the necessary capital structure changes needed. read more


Monday, February 27, 2017 Derek Macpherson

SMT Makes High Grade Discovery at Cusi

Download Report

Sierra Metals Inc. (TSX:SMT, BVL:SMT) announced the discovery of a new high grade silver zone within the Santa Rosa de Lima structure at its Cusi mine in Mexico. Given the significantly higher average grade of today’s results over Cusi’s resource grade, we believe this discovery could materially improve this mine’s economics in the same way the discovery of the Esperanza zone was for Sierra’s Yauricocha mine in Peru. We expect this discovery to add value to the Cusi asset and potentially positively impact the mine’s cash flow in the near term. However, in light of that Cusi only contributed 6% of Sierra’s consolidated Q4 2016 AgEq production, the impact of this discovery on Sierra’s overall cash flow is likely to be limited. However, this discovery may allow Sierra to monetize this asset. We continue to expect that Sierra’s performance in 2017 is going to be underpinned by operational improvements at Yauricocha, which in our view is key to enhancing the company’s value and positioning to bring about the necessary capital structure changes. read more


Wednesday, February 15, 2017 Derek Macpherson

SMT Reports Q4 Cost Improvements at Yauricocha

Download Report  

Sierra Metals Inc. (TSX:SMT, BVL:SMT) reported Q4 and full-year 2016 financial results from its Yauricocha mine in Peru (Sociedad Minera Corona – 81.8% owned subsidiary) which continues to demonstrate the benefits of the optimization program and improving grades. As the result of a planned shutdown, costs were modestly higher versus Q3 2016, with cash costs coming in ~11% higher and all-in sustaining costs (AISC) up ~6%. However, costs were substantially improved over Q4 2015, as cash costs were 23% lower and AISC were 25% lower; highlighting the operational and grade improvements Sierra has delivered in 2016. We view the results positively as continued operating execution along with exploration success at Yauricocha is key to enhancing the company’s value and positioning to bring about the necessary capital structure changes needed. read more


Wednesday, January 18, 2017 Derek Macpherson

Sierra Reports a Solid Q4

Download Report

Sierra Metals Inc. (TSX:SMT,BVL:SMT) reported Q4 and 2016 production results that were highlighted by record consolidated throughput and the company’s second highest level of annual metal production to date. At 79.1M lb CuEq, Sierra’s annual production increased by 4% YoY and reached the higher end of the company’s 2016 guidance (69.1-85.3M lb CuEq). The company’s Q4 production was flat QoQ but increased by 31% YoY (Figure 1). Of note, Yauricocha’s quarterly production increased by 1% QoQ, although a planned shutdown took place at the mine during Q4. Bolivar benefited from record annual throughput in 2016 which increased by 14% YoY but the mine’s annual production, which increased by only 4% YoY, was impacted by declines in grades and recoveries. In addition, the company released its 2017 production and cost guidance with an expected increase of 25-45% over 2016 production. In our view, it is likely that Sierra is posed for a strong 2017 on the back of operational improvements at Yauricocha and continued exploration success at the mine’s Esperanza zone. We expect Sierra’s operational execution to bring about the capital structure changes needed to improve the stock’s liquidity, which in our view, has the potential to positively benefit the company’s share price.  read more


Monday, January 16, 2017 Derek Macpherson

SMT Advances Spin-off of Northern Peru Assets

Download Report

Sierra Metals Inc (TSX:SMT, BVL:SMT) announced the filing of a preliminary prospectus as part of the previously announced spin-off of its northern Peru exploration assets. Sierra intends to spin out its 320 km2 Las Lomas property in Peru by distributing shares of its newly formed Peruvian subsidiary, Cautivo Mining Inc., to existing shareholders. To adjust its share capital in accordance with the impact of the transaction, the company intends to reduce Sierra shares by an amount equal to the fair market value of the Cautivo shares distributed. While conditions of the transaction have not been finalized we view the spin-off positively as besides reducing holding costs, this could provide Sierra shareholders with the potential to obtain value for this non-core asset. Coupled with the continued exploration success at the Esperanza zone and operational improvements at its Yauricocha mine in Peru, the transaction could contribute to Sierra’s efforts in bringing about the capital structure changes needed to improve the stock’s liquidity, which we believe has the potential to positively benefit Sierra’s share price.  read more


Friday, November 18, 2016 Derek Macpherson

SMT Finds Another New Near Mine Zone at Yauricocha

Download Report

Sierra Metals Inc. (TSX:SMT, BVL:SMT) reported the discovery of Cuye-Mascota, a new sulphide zone, during brownfield exploration at its Yauricocha mine in Peru. This discovery, along with the discovery of the Esperanza zone earlier this year, highlight the near-infrastructure discovery potential at the company’s flagship asset. As well, the results on average returned above resource grades, suggesting the higher grades that the company is currently mining may continue beyond the Esperanza zone, which would benefit medium-term cash flow. In our view, this discovery along with ongoing operational improvements should position Sierra to facilitate the capital structure changes needed to improve the stock’s liquidity, which we believe has the potential to positively benefit Sierra’s share price.  read more


Tuesday, November 15, 2016 Derek Macpherson

SMT’s Q3 Financials Reflects Strong Operating Results

Download Report

Sierra Metals Inc. (TSX:SMT, BVL:SMT) reported strong Q3 financial results which reflected the quarter’s strong operating results that were largely attributable to the company’s success at Yauricocha and its emphasis on improving operations. As a result, company-wide cash costs declined 27% QoQ and 33% YoY to US$6.71/oz AgEq. Consolidated all-in sustaining costs (AISC) declined 18% QoQ and 32% YoY to US$12.55/oz AgEq. Of note, although throughput at Sierra’s Cusi mine in Mexico was down 6% YoY, the mine’s cash costs decreased by ~9% QoQ and YoY while AISC was up 4% QoQ but down 49% YoY on the back of higher recoveries, higher gold and lead grades and the commencement of zinc production earlier this year. The company’s EPS in the quarter was ~US$0.01/sh and CFPS was US$0.10/sh. Continued exploration success at the Esperanza zone and operational improvements at Yauricocha should position Sierra to facilitate the capital structure changes needed to improve the stock’s liquidity, which we believe has the potential to positively benefit Sierra’s share price.  read more


Thursday, November 03, 2016 Derek Macpherson

SMT’s Strong Production Results Lower Yauricocha Costs

Download Report  

Sierra Metals Inc. (TSX:SMT, BVL:SMT) reported strong Q3 financial results from the Peruvian subsidiary, Sociedad Minera Corona (81.8% owned), which holds the company’s flagship Yauricocha mine. After reporting strong Q3 production results from Yauricocha two weeks ago, as expected cash costs declined materially. The combination of higher grades and increased throughput resulted in all-in sustaining costs (AISC) declining by 17% QoQ and 19% YoY to US$11.80/oz AgEq and cash costs declining 30% QoQ and 25% YoY to US$6.55/oz AgEq. Besides the benefit of the higher grade Esperanza zone, the cost reduction is likely also reflective of the company’s continued focus on improving its operations. We note that Sierra also announced that Q4 production from Yauricocha is expected to be impacted by a planned 25-day mining shutdown to upgrade the existing shaft hoist.  read more


SUBSCRIBE TO HEAR FROM US

Gain access to exclusive mining industry research reports as well as additional mining industry information, promotional materials, press releases and news.

RCKS Talk Daily Analysis
RCKS News
LATEST POST
CATEGORIES
RELATED TAGS
ARCHIVES

 

RISK WARNING:

Red Cloud Klondike Strike Inc. is registered as an Exempt Market Dealer (EMD) in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland & Labrador, and Yukon.

 

By accessing this website you agree to be bound by our Terms of Use and Privacy Policy.

 

Red Cloud Klondike Strike Inc. connects mining companies with suitable investors that qualify under available regulatory exemptions. For example, in Canada, according to National Instrument 45-106, Prospectus and Registration Exemptions. Similar laws and regulations apply in other jurisdictions. Companies presented on this website are considered to be highly speculative and, as such, are suitable only for purchasers who can tolerate the highest level of risk including the loss of their entire investment.

© Copyright 2017 Red Cloud Klondike Strike Inc. All rights reserved.