Release Date: November 13, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Avino Silver & Gold Mines Ltd (ASM) reported a 13% increase in total equivalent production compared to the same quarter last year.
• The company achieved a 19% increase in silver production, reaching 282,000 ounces.
• ASM reported a quarterly record of $5.7 million in gross profit, with a 45% margin, the highest in recent history.
• The company has improved its working capital position to nearly $16 million, a significant improvement from the previous year.
• ASM is on track to meet its production guidance of 2.5 to 2.8 million ounces of silver equivalent for 2024, with higher grades and recoveries in silver and copper.

Negative Points

• The company faced challenges with mill availability in late June to mid-July, impacting production.
• ASM's effective tax rate has been elevated in recent quarters, reflecting higher profitability and tax obligations in Mexico.
• The company is sensitive to fluctuations in the Mexican Peso, which can impact cost structures.
• There are pending approvals required for the underground development at La Preciosa, which could delay project timelines.
• ASM's all-in sustaining cash costs per ounce remain relatively high, although they have decreased from the previous quarter.

Q & A Highlights

• Warning! GuruFocus has detected 3 Warning Sign with ASM.

Q: Can we expect the same production performance at the Avino Mine in Q4 as seen in Q3? A: (David Wolfin, CEO) Yes, it's fair to expect similar performance, although December might be slower due to holidays. Overall, the performance has been consistent.

Q: What is the impact of a $1 change in the price of silver on mine operating cash flow? A: (Nathan Hart, CFO) A $1 increase in silver price closely translates to a dollar-for-dollar impact on mine operating cash flow, though other factors also play a role.

Q: What are the remaining stockpiles at La Preciosa, and what should we expect heading into 2025? A: (David Wolfin, CEO) We have processed all the stockpiled material we intended to. We sampled various areas to understand the grade and have completed the processing.

Q: What are the expected development costs and timeline for underground work at La Preciosa? A: (Nathan Hart, CFO) We estimate $3 to $4 million in initial development costs. We aim to accelerate these plans and will provide more details early next year.

Q: How sensitive are your costs to movements in the Mexican Peso? A: (Nathan Hart, CFO) Our costs are quite sensitive, with about 75% of expenses in Pesos. We are taking measures to protect against volatility, especially given past impacts.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.