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Avino Silver (ASM) Earnings Break Even in Q3, Revenues Lag

·4 min read

Avino Silver & Gold Mines Ltd. ASM reported break-even earnings per share in third-quarter 2021 compared with the Zacks Consensus Estimate of 1 cent per share. The company had reported a loss of 1 cent per share in the prior-year quarter.

Including one-time items, the company had reported a loss of 5 cents per share in the year-ago quarter.

Avino Silver’s revenues slumped 29% year over year to $1.88 million in the third quarter. The top line missed the Zacks Consensus Estimate of $6 million. Lower revenues were primarily due to only one month of sales. On Aug 3, 2021, the company announced that mining operations have resumed at the Avino Mine following a year-long suspension due to the COVID-19 lockdown, followed by a strike. Mining activities continued to ramp up and the company expects to reach previous production levels during the ongoing quarter or the first quarter of 2022.

Avino Silver Price, Consensus and EPS Surprise

Avino Silver Price, Consensus and EPS Surprise
Avino Silver Price, Consensus and EPS Surprise

Avino Silver price-consensus-eps-surprise-chart | Avino Silver Quote

Avino Silver reported consolidation production of 285,464 silver equivalent ounces in the third quarter of 2021. This comprised 77,935 ounces of silver, 1,183 ounces of gold, and 685,535 pounds of copper from its Avino Mine property. The company is currently mining and milling from the Avino Mine only.

Operational Update

The company recorded cash costs of $6.75 per silver equivalent payable ounce, indicating a 46% plunge from the year-ago quarter. Consolidated all-in sustaining costs (“AISC”) of $25.60 per silver payable equivalent ounce came in 19% lower than the prior-year quarter.

Avino Silver reported mine-operating profit of $0.8 million in the third quarter, a turnaround from a loss of $0.2 million in the prior-year quarter. EBITDA came in at $0.2 million compared with a loss of $4.2 million in the prior-year quarter.

Financial Position

Avino Silver ended third-quarter 2021 with $22.3 million of cash in hand, up from the $12.5 million at the prior-year quarter’s end. Capital expenditures for the first nine month period of 2021 were $2.1 million, up from $1 million in the prior-year comparable period, Expenditures include exploration drilling costs on the Avino property and the Oxide Tailings Resource, costs related to the construction of the dry-stack tailings storage facility, and the purchase of a scoop tram. The company has fully repaid its $10 million term facility and is now debt free.

On Oct 27, 2021, the company announced that it has entered into a definitive agreement with Coeur Mining, Inc. CDE to acquire the La Preciosa silver project. La Preciosa is a development stage mineral property, hosting one of the largest undeveloped primary silver resources in Mexico. It is located adjacent to Avino’s existing operations at the Avino Property in Durango, Mexico. Avino Silver will make a consideration of $29.7 million on closing of the deal and $5 million within 12 months of closing.

Price Performance

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Zacks Investment Research

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Shares of the company have gained 2.4% over the past year against the industry’s decline of 7.3%.

Zacks Rank & Stocks to Consider

Avino Silver currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the basic materials space include Commercial Metals Company CMC and Nucor Corporation NUE. Both of these stocks currently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Commercial Metals has an expected earnings growth rate of 3.7% for the current year. The company’s shares have gained 65% in the past year.

Nucor has a projected earnings growth rate of 585% for the current year. The company’s shares have soared 123% in a year’s time.


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