Gatos had production of 2.3 million oz. of silver, 19.1 million lb. of zinc and 12 million lb. of lead in Q2 2024.
Shares of Gatos Silver (NYSE, TSX: GATO) soared to a three-year high on Wednesday after the precious-base metals miner announced record quarterly zinc production from its flagship Cerro Los Gatos (CLG) mine in Mexico.
The stock traded as high as $13.82 apiece in New York, and as of 2:10 p.m. is up 21.7% to $13.54 a share, for a market capitalization of $938.8 million.
For the three months ended June 30, 2024, Gatos had production of 2.3 million oz. of silver, 19.1 million lb. of zinc and 12 million lb. of lead, plus 1,360 oz. of gold. In silver-equivalent terms, total production was 3.88 million oz., which is 18% higher than the second quarter of 2023.
The half-year production totalled 4.67 million oz. of silver, 34.9 million lb. of zinc, 22.2 million lb. of lead and 2,750 oz. of gold, for 7.58 million oz. AgEq, tracking towards the upper end of the 2024 guidance of 13.5-15.0 million oz.
In addition, the company also had a record mill throughput for the sixth straight quarter, averaging 3,240 tonnes per day, with higher recovery rates for all metals (except gold) than Q2 2023. The improvement in zinc production was the most notable, up 29% from the comparable quarter.
According to Gatos, the processing plant is already reliably performing above 3,500 tonnes per operating day with no reduction in metallurgical recoveries, and the CLG team is focused on implementing various projects over the next 6-12 months to increase its daily production rate.
“Our mine debottlenecking efforts delivered a mill throughput average of 3,240 tonnes per day, up 1% from the first quarter of 2024 and up 11% from the second quarter of 2023, as we advanced towards our medium-term target of sustained throughput rates of 3,500 tonnes per day,” Gatos CEO Dale Andres said in a news release.
“We expect to complete an updated life of mine plan in the third quarter of 2024 with a target to further extend the mine life. We also increased exploration drilling efforts during the second quarter on both near mine targets and at the San Luis prospect located 5 km from the CLG mine.”
