Remember that First Majestic acquired the Jerritt Canyon Gold Mine from Sprott Mining Inc. Jerritt Caynon: A Black HoleĪs usual, Jerritt Canyon is mostly to blame for First Majestic's struggles. With ~$200 million in total debt, the company is quickly approaching a negative net cash position. These weak earnings negatively impacted its balance sheet, with the company ending the quarter with a total cash balance of $235.9 million, down $40 million from Q4. Its operating cash flow rose 63% to $21.9 million, but free cash flow still came in negative (-$26.7 million). Ultimately, the higher cash costs resulted in a small mine operating earnings loss of $6.4 million. Profit margins were extremely tight as AG reported a realized silver equivalent price of $21.98 on each ounce it sold. This quarter saw its costs rise slightly to $20.90 per silver equivalent ounce. First Majestic continues to be plagued by high cash costs. However, like last quarter, that's the best news to speak of. Not surprisingly, this also led to an increase in quarterly revenues to $157.0 million. It produced 2.5 million silver ounces and 60,594 gold ounces, or 7.6 million ounces silver equivalent, representing a 1% increase compared to the previous quarter and a 6% increase compared to Q1 2022. First Majestic Silver's Earnings: Worse Than ExpectedĪs usual, production was strong for the company. Here's a breakdown of First Majestic's latest earnings report and where the stock may be headed next. Its financial position is not dire, but it continues to worsen, and a capital raise may be necessary later this year. And, its latest Q1 earnings report indicates that the company does not have its cash costs under control at one of its major mines. Unfortunately for First Majestic, its recent share price gains look entirely related to the rebound in precious metals prices, and have nothing to do with improvements in its operational or financial performance. Was my initial assessment wrong, or is First Majestic Silver Corp. ( NYSE: AG), which I previously covered in a February article titled: "First Majestic Silver's Financial Health is Rapidly Deteriorating." However, since that article was published, First Majestic Silver shares have risen by 14%, outpacing the S&P 500 Index ( SP500 ) by nearly six times. This is an update on First Majestic Silver Corp. Peshkov First Majestic Silver: A Shining Comeback Or A Tarnished Future?
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