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Fortuna Silver (FSM) Gold & Silver Output Up Y/Y in Q4

Fortuna Silver Mines Inc. FSM reported gold production of 64,112 ounces and silver production of 1,746,746 ounces in fourth-quarter 2022.

FSM’s total output for 2022 was 259,427 ounces of gold and 6,907,275 ounces of silver, both up 25% and 8% respectively over 2021 levels. Gold equivalent ounces were reported at 401,878 ounces, within the company’s guidance of 369,000-420,000 GEOs.

The company reported lead production of 34,588,324 pounds in 2022, a 5% increase over 2021. Zinc production however declined 3% year over year to 46,175,821 pounds.

Mine Performances

Latin America posted the fifth consecutive quarter of gold production numbers over 35,000 ounces. The region achieved a record gold production of 153,319 ounces in 2022. Consolidated silver production was 6.9 million ounces, at the higher end of annual guidance. All three mines delivered production results in line with their mining plans and Mineral Reserves estimate

At the Lindero mine in Argentina, fourth-quarter gold production was 29,301 ounces, down 19% year over year mainly due to lower gold grade. Gold production in 2022 was a record 118,418 ounces.

The San Jose mine in Mexico produced 1.5 million ounces of silver and 8,499 ounces of gold in the fourth quarter, both down 14% year over year due to lower head grades. Silver and gold production for 2022 totaled 5.8 million ounces and 34,124 ounces, respectively.  

The Caylloma mine in Peru produced 273,119 ounces of silver in the December quarter, up 4% year over year. The year’s silver output for the mine was 1.14 million ounces. Zinc production for the quarter from the mine was 12.6 million pounds, up 10% year over year, impacted by lower head grades but partially offset by higher mill throughput and recovery. Lead production rose 4% year over year to 8.7 million pounds. The Yaramoko mine in Burkina Faso produced 26,190 ounces of gold in the fourth quarter of 2022.

Guidance for 2023

The company expects gold production between 282,000 to 320,000 ounces for 2023, which indicates growth of 9-23% over 2022 Silver production guidance for the year is at 6.3-6.9 million ounces, which suggests a decline of up to 9% from 2022 output. Gold equivalent production guidance range is between 412,000 to 463,000 ounces — a projected increase of 3-15% year over year.

Price Performance

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Shares of Fortuna Silver have gained 1.6% in the past year compared with the industry’s 15.2% decline.

Zacks Rank & Stock to Consider

Fortuna Silver currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the basic materials space are CalMaine Foods, Inc. CALM, Reliance Steel & Aluminum Co. RS and Franco-Nevada Corporation FNV. CALM and RS currently sport a Zacks Rank #1 (Strong Buy) and FNV carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for CalMaine Foods’ fiscal 2023 earnings per share is pegged at $14.08, suggesting 417.7% growth from the year-ago reported figure. Earnings estimates have moved 73.8% north in the past 60 days. CALM has a trailing four-quarter earnings surprise of 15.3%, on average. Its shares have gained 31.4% in the past year.

The Zacks Consensus Estimate for Reliance Steel’s earnings per share is pegged at $28.65 for 2022, indicating year-over-year growth rate of 29.5%. Earnings estimates have been revised 0.2% upward in the past 60 days. RS has a trailing four-quarter average surprise of 13.6%, on average. The company has gained 26.7% in a year.

The Zacks Consensus Estimate for Franco-Nevada’s 2022 earnings per share is pegged at $3.67, suggesting 4.3% growth from the year-ago reported figure. Earnings estimates have moved 4.2% north in the past 60 days. FNV has a trailing four-quarter earnings surprise of 1.3%, on average. Its shares have gained 8.1% in the past year.

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