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« Silver Wheaton Corporation: Earnings Triple | Main | Silver Prices at $19.34/oz »

Pan American Silver Corporation: First Quarter Highlights

PAAS Chart 13 May 2010.jpg

Pan American Silver's quarterly earnings came in below consensus, but shares are on the rise nevertheless. BNN speaks to Geoff Burns, CEO, Pan American Silver, to get his outlook for production in Mexico and Argentina, and silver prices in general.

Please click here to see the clip.

First Quarter 2010 Highlights are as follows:

Gold production increased 34% to 27,896 ounces.

• Cash costs (2) declined 27% to $4.35 per ounce of payable silver, net of by-product credits.

• Mine operating earnings (3) increased 252% to $36.9 million.

• Net income increased 189% to $19.1 million or $0.18 per share.

• Cash flow from operations (before changes in non-cash working capital) (4) increased 127% to $42.1 million, or $0.39 per share.

• Sales rose 88% to $132.4 million.

• First semi-annual dividend of $0.025 per share paid to shareholders in March.

• Completed acquisition of Aquiline Resources Inc. and launched a comprehesive development program at the Navidad silver project in Argentina.

To read the whole news release please click here.

Note the dramatic drop in their cash costs which Geoff puts down partly to higher gold prices, which is a by-product for PAAS. Going forward they are predicting output of 20 million ounces rising to 40 million ounces plus by 2014. Currently number two to Fresnillo, could challenge for the top spot shortly. Seven mines in operation now with two more heading for production shortly, so they are aiming to become the brand name in the silver space. All bodes well for the future.

Pan American Silver Corporation trades on the NASDAQ under the symbol of PAAS and on the Toronto Stock Exchange under the symbol of PAA.

PAAS has a market capitalization of $2.98 billion, with 106.09 million shares outstanding. PAAS closed yesterday at $27.87.

Keep smiling its all falling into place for gold and silver bugs.

Got a comment then please add it to this article, all opinions are welcome and very much appreciated by both our readership and the team here.

The latest trade from our options team was slightly more sophisticated trade than usual, in that we shorted a PUT as follows:

On Friday 7th May our premium options trading service OPTIONTRADER opened a speculative short term trade on GLD Puts, signalling to short sell the $105 May-10 Puts series at $0.09.

On Tuesday the 11th May we bought back the puts for just $0.05, making a 44.44% profit in just 4 days.

We've done a bit of a write up on have been rather fortunate to close both the $15.00 and the $16.00 options trade on Silver Wheaton Corporation, with both returning a little over 100% profit.

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Reader Comments (2)

I have been holding PAAS for a long time mainly, because I like the company and what they do. However, there are many firms with little movement in price over the years, which seem to expect investors to subsidize their business without any inducement to stay with them. A little enticement would be interesting in the form of a dividend, no matter how small - at least, it would be a start. The Officers get a nice package; salaries, expenses, bonuses, stock option plans etc. Let's spread some around, guys.

May 13, 2010 | Unregistered CommenterJohn Ell

Indeed, some of em need a good shake.

May 13, 2010 | Unregistered CommenterSilver Prices

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