• Revenue: $53 million, up 8% year over year.
• Cost of Sales: $41 million, a decrease of 12% compared to Q3 2023.
• Net Loss: $17 million for the three-month period ended September 30, 2024.
• Adjusted Income: $1.6 million compared to an adjusted loss of $8.3 million in Q3 2023.
• Cash Position: $55 million as of September 30, 2024.
• Working Capital: $29 million as of September 30, 2024.
• Silver Equivalent Production: 1.6 million ounces (875,000 ounces of silver and 9,300 ounces of gold).
• Project Spending: More than $258 million spent on Terra project to date.
• Debt Facility Drawdowns: $25 million completed during the quarter, with a final drawdown of $35 million subsequent to the quarter.

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

Release Date: November 05, 2024

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

Positive Points

• Endeavour Silver Corp (NYSE:EXK) reported an 8% year-over-year increase in top-line revenue, reaching $53 million, benefiting from higher precious metal prices.
• The company is on track with its updated 2024 production guidance of 7.3 to 7.6 million silver equivalent ounces, with Q3 production totaling 1.6 million ounces.
• Significant progress was made at the Terronera project, with surface construction reaching 77% completion and the project remaining on track for commissioning by the end of the year.
• The company successfully managed operational challenges at the Guanacevi mine, maintaining processing at 50% capacity and planning a return to full capacity within 15 weeks.
• Endeavour Silver Corp (NYSE:EXK) has a strong community engagement program, supporting local initiatives and investments, which enhances its social license to operate.

Negative Points

• The company reported a net loss of $17 million for Q3 2024, a significant increase from the $2.3 million loss in Q3 2023.
• Operational challenges included a failure of the primary ball mill at the Guanacevi mine, leading to reduced capacity and elevated costs.
• Cost of sales decreased by 12% due to lower silver ounces sold, but the company had to withdraw cost guidance for 2024 due to operational uncertainties.
• The company's cash position decreased, with $55 million in cash and $29 million in working capital as of September 30, 2024.
• Inflationary pressures have impacted cost estimates, with the company acknowledging potential increases in costs per ton compared to previous feasibility studies.

Q & A Highlights

Q: Can you provide an update on staffing levels and community engagement at the site? A: Daniel Dickson, CEO, stated that full employment at the site during operations will be over 500 people. Currently, there are over 750 people on site, including 250 Endeavour Silver employees and 800 contract workers. The community has been supportive, with initiatives like scholarships and local job creation being well-received. Donald Gray, COO, added that training programs have been successful, filling all slots as word spread about their quality.

Q: What are the expectations for G&A expenses for the remainder of 2024 and into 2025? A: Daniel Dickson, CEO, mentioned that historically, Endeavour's G&A expenses have been around $8 to $10 million USD annually. He does not anticipate a significant increase in 2025 compared to 2024, maintaining the same cash G&A levels.

Q: Can you elaborate on the ramp-up process at Terronera and potential bottlenecks? A: Daniel Dickson, CEO, expects a three-month ramp-up period, hoping for a quicker process. Donald Gray, COO, highlighted that the focus will be on the concentrate and tailing filters, with vendor support in place to ensure smooth commissioning.

Q: What is the current status of the Guana V mine and any challenges in returning to steady-state operations? A: Donald Gray, COO, reported that the team has done a commendable job maintaining operations and repair work. They are in good shape with contractors lined up for when parts arrive, not expecting any significant issues.

Q: How are current precious metal prices affecting your mine plans? A: Daniel Dickson, CEO, explained that higher prices allow for revisiting areas previously abandoned, potentially incorporating inferred ounces into mine plans. They are currently finalizing budgeting and mine plans for the next year.

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