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« OptionTrader: Your Money Back If Gold Doesn’t Trade Above $1265 in 2010! | Main | Reduced Exposure to Pan American Silver Corporation »

Silver Wheaton Corporation Sparkling 2nd Quarter Results

SLW Chart 14 August 2010.JPG

Nothing too dramatic about the chart above but be aware that a number of silver and gold producers have suffered the death which is a downward motion made by the 50dma when it crosses through the 200dma heading south. Hopefully the consolidation will continue, positioning Silver Wheaton Corporation (SLW) well for the 'fall' rally by silver prices.

Peter Barnes, Chief Executive Officer of Silver Wheaton, commented on their recent 2nd Quarter Results as follows:

"Another very solid quarter resulted in record sales and earnings, with Goldcorp's Penasquito mine in Mexico, the first of our cornerstone assets, continuing to ramp up silver production ahead of schedule, we look forward to an even stronger second half to the year and maintain our annual attributable silver equivalent production guidance of 23.5 million ounces. In the face of continued global economic uncertainty, the price of silver performed very well in the quarter, leading to record cash operating margins of US$14.45 per ounce, and clearly demonstrating the advantages of Silver Wheaton's business model of low fixed operating costs."

For those wishing to read the news release in full please click here, however, the highlights are listed below:

- Net earnings increased by almost 200% to a record US$53.3 million
(US$0.16 per share), compared with US$18.4 million (US$0.07 per
share) in 2009.

- Operating cash flows increased by more than 150% to US$67.0 million
(US$0.20 per share)(1), compared with US$26.5 million (US$0.09 per
share)(1) in 2009.

- Attributable silver equivalent production of 5.7 million ounces (5.3
million ounces of silver and 5,800 ounces of gold), representing an
increase of 33% over the comparable period in 2009.

- Record silver equivalent sales of 5.1 million ounces (4.6 million
ounces of silver and 7,600 ounces of gold), representing an increase
of 74% over the comparable period in 2009.

- Total cash costs(1) of US$4.03 per silver equivalent ounce, compared
with US$3.99 per ounce in 2009.

- Cash operating margin(1) increased by 44% to US$14.45 per silver
equivalent ounce, compared with US$10.05 per ounce in 2009.

It all reads very well in out humble opinion and SLW being our largest holding will be the main vehicle in our attempts to profit from the anticipated improvement in silver prices, through further accumulation and various options plays.

Stay on your toes these are treacherous waters and have a good one.

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 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.

Recently our premium options trading service OPTIONTRADER has been putting in a great performance, the last 16 trades with an average gain of 42.73% per trade, in an average of just under 38 days per trade. Click here to sign up or find out more. 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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