Silberexplorer geht in Produktion

Another excellent quarter at Escobal – Tahoe reported total silver production in Q1 2017 of 5.7 million ounces driven by strong results at Escobal. Q1 2017 silver production was 17% higher than the previous quarter and the highest quarterly production since Q1 2016 (5.7 million ounces). Total cash costs and all-in sustaining costs ("AISC") were $5.72 and $8.11 per ounce of silver produced, net of byproduct credits, respectively, better than the $6.48 and $9.76 per ounce recorded in Q4 2016 and well below the full-year target ranges included in the Company's 2017 guidance.  

Strong results from all three gold operations – Q1 2017 gold production totaled 119.1 thousand ounces, compared to record production of 119.9 thousand ounces in Q4 2016.  Production and costs in Q1 2017 reflected strong results at all of the Company's mines, as well as a one-time addition of 9.0 thousand ounces related to a change at La Arena and Shahuindo to report production as ounces recovered versus ounces poured. The reporting change had no impact on gold sales. Total cash costs and AISC averaged $574 and $860 per ounce in Q1 2017, which compared to $594 and $945, respectively, in the previous quarter. Excluding the impact of the change, total cash costs and AISC in Q1 2017 were $623 and $933 per ounce, well below the target ranges included in full-year 2017 guidance.

Record earnings and cash flow per share driven by record revenue and low costs – Q1 2017 cash flow provided by operating activities before changes in working capital was a record $132.9 million or $0.43 per share, and represented increases of 78% and 79%, respectively, from the previous quarter. Earnings and adjusted earnings in Q1 2017 were a record $74.7 million and $75.1 million, respectively, and were both $0.24 on a per share basis. The results compared to earnings of $0.3 million or $0.00 per share and adjusted earnings of $18.4 million or $0.06 per share in Q4 2016.  Record cash flow and earnings largely resulted from a 33% increase in revenues compared to Q4 2016, to a record $251.0 million in Q1 2017. The increase in revenues reflected record gold sales of 115.9 thousand ounces, as well as increases in silver sales and the realized price for silver of 24% and 33%, respectively, from Q4 2016 levels.  

Growth plans remain on track – Capital expenditures in Q1 2017 totaled $48.6 million, of which $33.1 million was for sustaining capital expenditures and $15.5 million was related to project capital. Exploration expenditures in Q1 2017 totaled $4.2 million. Capital and exploration expenditures were lower in the first quarter than the expected average for the year due to the lag time between ordering, completions and the normal billing cycle, the schedule for receipt of permits and commencing work programs and the impact of minor delays due to heavy rains at Shahuindo. Expenditure levels are expected to increase over the balance of 2017 as the Company works towards completing expansion projects at Shahuindo and the Bell Creek mine in mid-2018 and undertakes exploration programs at a number of high-potential targets.  

Industry-leading dividend – $18.7 million was paid in dividends to shareholders in Q1 2017, including $3.9 million in share-based dividends.

Ron Clayton, President and CEO of Tahoe, commented: "We are off to a great start in 2017, with record cash flow per share as well as earnings and adjusted earnings in the first quarter largely driven by strong operating results at all of our mines. Total silver production was 5.7 million ounces for the quarter with per ounce costs averaging well below our target ranges for the year. Turning to gold, we were very pleased with the results from all of our gold mines, with each operation's production and costs coming in at, or better than, expected levels. Equally important, at quarter end we remained well positioned to achieve our growth targets, including producing at least a half million ounces of gold in 2019 at AISC averaging below $1,000 per ounce.

"Looking at the remainder of 2017, our full-year 2017 production and cost guidance for both silver and gold remains unchanged as production and per ounce costs are expected to be more in line with target levels over the balance of the year.  The pace of both capital and exploration  expenditures has increased on schedule in the second quarter as we move towards completing the initial circuit of our crushing and agglomeration plant at Shahuindo in the second half of this year and advance work to expand Shahuindo to 36,000 tonnes per day and Bell Creek mine to 80,000 ounces per year by late 2018."

Performance Against 2017 Guidance

In Q1 2017, the Company performed well against all of its 2017 guidance. The table below provides Tahoe's 2017 guidance as well as the related Q1 2017 performance. For a review of performance against each operations's guidance, see the Review of Operations section later in this press release.