Santacruz Silver Mining Q2 Earnings Call Highlights

Operational performance improved: Q2 consolidated silver production rose 17% quarter over quarter and zinc production increased 7%, while silver all-in sustaining costs fell 24% to $21.87 per ounce. Bolivar’s dewatering and rehabilitation program remains on schedule, with full recovery targeted for Q4. Exports delayed sales but largely recovered: Bolivia’s 53-day road blockades left more than 7,800 tons of concentrate in inventory, temporarily reducing recognized sales. About 97% of the inventory had been sold by the webinar, generating nearly $23 million and helping lift treasury holdings above $100 million. Growth initiatives remain on track: Santacruz expects Soracaya permits in Q3 and plans to begin small-scale production by the end of Q4, with potential annual output of up to 3 million silver-equivalent ounces. Management is also pursuing renewal of the Illapa joint operation through 2043 and evaluating acquisitions of producing mines.

Santacruz Silver Mining NASDAQ: SCZM said its second-quarter operating performance improved across its portfolio, with higher silver and zinc output, while temporary export constraints in Bolivia delayed some sales into subsequent periods. During the company’s Q2 results webinar, Executive Chairman and CEO Arturo Préstamo Elizondo said consolidated silver production rose 17% quarter over quarter and zinc production increased 7%. He attributed the silver increase primarily to the Bolivar mine, where production rose by 84,000 ounces as tons milled increased 11% and silver head grades improved 17%. Bolivar’s recovery remains tied to a dewatering program that Préstamo said is proceeding on schedule and on budget. The company continues to rehabilitate the main ramp toward lower levels and prepare stopes for mining, with full recovery still targeted for the fourth quarter. Santacruz has also identified two high-grade areas that had previously been left behind and incorporated them into its mining plans for next year.

Operational gains across portfolio Management said operating improvements extended beyond Bolivar. At Zimapán, silver recoveries improved 10%, while zinc head grades and recoveries each increased 9%. Caballo Blanco increased silver production by 6%, supported by a 5% improvement in silver head grades. Porco processed 15% more tons and reported a 21% rise in silver head grades. San Lucas processed 22% more tons than in the prior quarter and increased silver production by 20%, according to Préstamo. Consolidated mining throughput rose 7% during the quarter. Préstamo also pointed to the impact of capital investments at Zimapán, including flotation and flash-cell circuits. He said the investments are beginning to support improved recoveries for zinc, copper and silver. Management said Zimapán reached level 960 and that some stopes planned for the coming quarter are already in production.

Santacruz reported silver all-in sustaining costs of $21.87 per ounce, down 24% from the prior quarter. Préstamo said the reduction was driven mainly by better silver head grades, higher recoveries and a 7% increase in material processed across the company’s five operations. Higher copper and lead production also provided stronger byproduct credits, while lower sustaining capital and general costs reduced the all-in figure further. Exports delayed revenue recognition CFO Andrés Bedregal said the company generated strong underlying financial results despite a mismatch between production and sales caused by road blockades in Bolivia. The blockades lasted approximately 53 days, constraining concentrate exports while operations continued. Bedregal said revenue rose 55% year over year, gross profit nearly d...