SSR’s adjusted net income up for second quarter

SSR Mining Inc. posted adjusted net earnings of $75.1 million, or 37 cents per share, for the second quarter, up from the second quarter of last year, and production of 156,625 gold equivalent ounces in the quarter, slightly down from last year.

For the first half of the year, the company produced 303,518 gold equivalent ounces at all-in sustaining costs of $1,663 per ounce. SSR’s executive chairman, Rod Antal, said in the earnings call that the company has established a platform for at least 700,000 ounces of annual production “over the remainder of the decade.”

The Denver-based company that operates the Marigold Mine in Nevada also reported that Marigold at Valmy produced 60,443 ounces of gold in the second quarter at all-in sustaining costs of $1,656 per ounce and added four new haul trucks for waste stripping. SSR stated earlier that the stripping is at the Red Dot deposit.

Production at Marigold was up from 40,769 ounces in the second quarter of last year due to more tons stacked and the timing of leach recoveries, and SSR stated that no further delays to gold recovery are expected this year.

“As we close the first half of 2023, our consolidated operating and financial results have generally been well aligned to our initial expectations, with output from Copler, Marigold and Puna partially offset by the slower start of the year at Seabee,” Antal said.

Seabee is in Saskatchewan. Puna is in Argentina, and Copler is in Turkey.

Antal said Seabee is positioned for better production in the second half of the year, and ore grades improved in July.

Gold production at Seabee totaled 16,428 ounces in the second quarter, while Copler produced 52,031 gold ounces in the quarter and Puna produced 2.3 million ounces of silver. All-in sustaining costs companywide for gold equivalent production in the second quarter were $1,633 per ounce.

“In the second half of the year, we expect all four of our operations to deliver improved consolidated production of approximately 400,000 gold equivalent ounces at reduced costs, resulting in strong free cash flow generation,” Antal said.

The company’s net income attributable to shareholders for the second quarter totaled $74.87 million, or 37 cents per share, about the same as the adjusted net income for the quarter. This compared with $58.49 million, or 28 cents per share, in the 2022 quarter. Free cash flow totaled $22.4 million.

SSR’s average realized gold price for the second quarter was $1,963 per ounce, compared with $1,861 per ounce in the 2022 quarter, and the average realized silver price was $24.61 per ounce, up from $19.64 per ounce in the second quarter of last year, according to the earnings report.

“Given our expectations for a strong second half of 2023, we have been very active with our capital returns program, repurchasing over $45 million shares in the first half of the year. Combined with our base dividend, we are on track to exceed $100 million in capital returns in 2023, or a 3.4% yield,” Antal said.

SSR’s chief financial officer, Allison White, said in the earnings presentation that the company has returned more than $400 million to shareholders over the past three years, and the board declared a dividend for the quarter of 7 cents per share.

She also said that “with respect to inflation, we’ve seen an improvement in diesel and power prices across the portfolio but note that the consumables pricing and labor cost pressures do remain a headwind.”

Antal said in the earnings announcement that “from a growth perspective, we continue to advance technical work to support anticipated updated life of mine plans at Copler and Marigold,” adding that waste stripping has started at Cakmaktepe Extension at Copler in Turkey with the first gold production expected this year.

Bill MacNevin, executive vice president of operations and sustainability, said in the webcast that the upcoming technical report for Marigold includes two years of exploration drilling.

The company’s slide presentation includes an update on opportunities at Marigold, stating that New Millennium hosts potential as a larger, consolidated pit, and current exploration is focused on additional oxide ore that complements or extends the existing mine plan.

SSR Mining also wrote that there is potential longer-term production from Trenton Canyon and Buffalo Valley oxide deposits south-southwest of New Millenium, and there is exploration for structurally controlled sulfide mineralization potential.

SSR Mining additionally reported it has begun initial site preparation at the Hod Maden Gold-Copper Project in Turkey. The company acquired up to a 40% interest and immediate operation control of the development project for an aggregate consideration of $270 million, including a $120 million upfront cash payment.

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