Vancouver, B.C. - November 7, 2023 - Pan American Silver Corp. (NYSE: PAAS) (TSX: PAAS) ("Pan American" or the
"Company") reports unaudited results for the quarter ended September 30, 2023 ("Q3 2023").
"We are reaffirming our annual 2023 guidance ranges for silver and gold production with the expectation that
production for both will come in at the low end of the ranges. We expect Gold Segment Cash Costs and AISC to be
within the guidance ranges and Silver Segment Cash Costs and AISC to be marginally above their guidance ranges,"
said Michael Steinmann, President and Chief Executive Officer. "While mine operating performance was broadly in
line with the plan across the portfolio, ventilation constraints at La Colorada and lower grades at El Peñon weighed
on silver and gold production."
"With the recent sales of the MARA project, the Morococha mine and our interest in Agua de la Falda, which was
completed on November 6, 2023, we have advanced our objectives to rationalize the portfolio as well as reduce
debt and future financial obligations. We expect to save approximately $90 million in cash annually, primarily from
the elimination of care and maintenance, project development and reclamation costs associated with MARA and
Morococha, in addition to interest expense from having repaid the $280 million that was drawn on our credit
facility at the end of June 30, 2023."
"We expect to capture a further $40 million to $60 million in annual savings through synergies associated with
integrating the Yamana assets. The integration is progressing well, and we are currently evaluating optimization
and exploration plans for the newly acquired mines. We will also continue to evaluate ways to further rationalize
our overall portfolio," added Mr. Steinmann.
The following highlights for Q3 2023 include certain measures that are not generally accepted accounting
principles ("non-GAAP") financial measures. Please refer to the section titled “Alternative Performance (NonGAAP) Measures” at the end of this news release for further information on these measures.
Consolidated Q3 2023 Highlights:
• Silver production of 5.7 million ounces and gold production of 244.2 thousand ounces. Silver production
was at the low end and gold production was slightly below management's guidance ranges for Q3 2023.
• Revenue was $616.3 million.
• Net loss of $22.7 million ($0.06 basic loss per share), impacted by higher taxes.
• Adjusted earnings were $3.1 million, or $0.01 adjusted earnings per share.
• Cash flow from operations was $114.6 million, net of $35.8 million in tax payments.
• Silver Segment Cash Costs and All-in Sustaining Costs ("AISC") per silver ounce of $13.13 and $18.19,
respectively.
• Gold Segment Cash Costs and AISC per gold ounce of $1,187 and $1,451, respectively.
• Based on operating results to date, and expected results for the remainder of the year, the Company
reaffirms its 2023 Operating Outlook, as provided in the Company's Q1 2023 MD&A dated May 10, 2023,
for silver and gold production but expects both to be at the low-end of their respective annual guidance
ranges, and Silver Segment Cash Costs and AISC to come in marginally above the high-end of the guidance
ranges. The Company reaffirms its 2023 Operating Outlook for production of base metals, Gold Segment
Cash Costs and AISC, and sustaining and project capital expenditures, all of which are expected to be
within guidance ranges.
• As at September 30, 2023, the Company had working capital of $832.1 million, inclusive of cash and
investments of $386.0 million, and $750.0 million available under its revolving sustainability-linked credit
facility ("SL-Credit Facility"). The Company made a net repayment of $280.0 million on the SL-Credit
Facility in Q3 2023. Total debt of $809.1 million is primarily related to two senior notes Pan American
Q3 2023 NEWS RELEASE
All amounts expressed in U.S. dollars unless otherwise indicated. Unaudited tabular amounts
are in millions of U.S. dollars and thousands of shares, options, and warrants, except per share
amounts, unless otherwise noted.
PAN AMERICAN SILVER CORP. 1
assumed through the acquisition of Yamana Gold Inc. ("Yamana"), as well as construction and other loans
and leases.
• A cash dividend of $0.10 per common share with respect to Q3 2023 was declared on November 7, 2023,
payable on or about December 1, 2023, to holders of record of Pan American’s common shares as of the
close of markets on November 20, 2023. For the nine-months ended September 30, 2023, the Company
paid cash dividends totaling $94.0 million. The dividends are eligible dividends for Canadian income tax
purposes.
• At the La Colorada mine, the Company invested $14.0 million of project capital in Q3 2023 to advance the
La Colorada Skarn project, largely for exploration and the preliminary economic study underway, as well as
advancing the excavation of the concrete-lined ventilation shaft. The shaft reached a depth of 522 meters
by the end of Q3 2023 and is expected to be fully excavated to a depth of 593 meters by the end of 2023.
The installation of two large exhaust fans on the surface of the shaft is expected to be completed by
mid-2024, following which ventilation conditions in the mine are expected to improve significantly. The
preliminary economic study for the Skarn project is on schedule to be released by year-end 2023.
• At the Escobal mine in Guatemala, Pan American hosted three visits to the mine for Xinka Indigenous
representatives and their advisors and participated in several other meetings with the Xinka
representatives and Guatemala’s Ministry of Energy and Mines during Q3 2023. At this time, no date has
been set for the completion of the ILO 169 consultation process, or a potential restart of operations at
Escobal. In September 2023, Guatemala’s Chamber of Industry awarded Pan American first place in the
Environment category for a reforestation and conservation project, which involved an innovative approach
for the reproduction of native oak trees within the Escobal mine area.
Completion of the sale of Agua de la Falda
On November 6, 2023, Pan American completed the previously announced divestment of its 57.74% interest in
Agua de la Falda S.A. (“ADLF”), a Chilean company that holds the historical Jeronimo project, located in the
Atacama region of northern Chile, as well as several adjoining concessions.
Under the terms of the agreement, Rio Tinto Chile SPA (“Rio Tinto”), a subsidiary of Rio Tinto Limited, paid
US$45.55 million, in cash, for the shares in ADLF and granted to a Pan American subsidiary a net smelter return
royalty of 1.25% on all precious metals and a net smelter return royalty of 0.2% on all base metals, on production
from certain mineral concessions of ADLF, applied on a pro rata basis in accordance with the ownership interest
acquired in such concessions. The remaining 42.26% interest is held by Corporación Nacional del Cobre de Chile.
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