Pan American Silver is one of the largest global primary silver producers and a sizeable gold miner with operations in North, Central and South America since 1994. It owns 11 producing operations, the currently suspended top tier Escobal silver mine and a number of large-scale advanced exploration/development projects.
PAAS shares remain weak despite the evidence of impressive cash flow generation in FY23 and the strong gold price that does not seem to fully discount the interest rate reduction potential.
Metals & Mining |
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Metals & Mining |
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Metals & Mining |
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Metals & Mining |
Flash note
Guido Mastropietro
Director, finance
Siren Fisekci
VP, investor relations and corporate communic
Forecast net debt (US$m)
360.8
Forecast gearing ratio (%)
8
% | 1M | 3M | 12M |
---|---|---|---|
Actual | 10.5 | (17.1) | (22.7) |
Relative | 7.6 | (23.9) | (41.0) |
52 week high/low | US$19.5/US$12.2 |
Pan American Silver (PAAS) reported FY23 financial results, which were broadly in line with our expectations at the EBITDA level. However, the bottom line was affected by non-cash impairment charges of US$79m. As a result, reported EPS loss was US$0.32, while company adjusted EPS came in at US$0.12. As expected, the silver segment cash cost of US$13.1/oz was above guidance, while the gold segment cash cost of US$1,113/oz marginally exceeded guidance. The quarterly operating outlook for FY24 suggests the current year performance to be H2-weighted, mainly due to the timing of the anticipated operational recovery at La Colorada. PAAS finished the year with net debt of US$361m, supported by the strong cash flow generation and recommended a Q4 dividend of US$0.10/share. PAAS has also announced a share buyback of up to 5% of outstanding shares.
Y/E Dec | Revenue (US$m) | EBITDA (US$m) | PBT (US$m) | EPS (fd) (c) | P/E (x) | P/CF (x) |
---|---|---|---|---|---|---|
2022A | 1494.7 | 272.0 | (73.0) | (54.06) | N/A | N/A |
2023A | 2316.1 | 680.6 | 108.4 | 19.45 | 75.0 | N/A |
2024E | 2578.0 | 764.6 | 174.5 | 23.70 | 61.5 | 61.0 |
2025E | N/A | N/A | N/A | N/A | N/A | N/A |
thematic
Metals & Mining