Pan American Silver Corp. (NASDAQ:PAAS) Q3 2019 Earnings Conference Call Transcript

Nov 07, 2019 • 11:00 am ET

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Pan American Silver Corp. (NASDAQ:PAAS) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Thank you for standing by. This is the conference operator. Welcome to the Pan American Silver Third Quarter 2019 Earnings Conference Call. [Operator Instructions]

I would now like to turn the conference over to Siren Fisekci Vice President of Investor Relations. Please go ahead.

Executive
Siren Fisekci

Thank you Operator and welcome everyone to Pan American Silver's Third Quarter 2019 Conference Call. We released our results after yesterday's market close and a copy of the news release and presentation slides for today's call are available on our website. In a few moments I will turn the call over to Pan American's President and CEO Michael Steinmann who will provide a brief review of our results. I will then open the call to questions and answers. Joining us for the Q&A portion are Pan American's Chief Operating Officer Steve Busby; Chief Financial Officer Rob Doyle; Senior VP project development, George Greer, Senior VP technical services and process optimization Martin Walker, and VP of business development and geology Chris Emerson. I'd like to remind everyone that our news release and certain statements and information this call constitute forward looking statements and information. Please review the cautionary statements included in our news release and presentation, as well as the risk factors described in our most recent Form 40-F and Annual Information Form. Media and other participants on the call are invited to participate in listen-only mode.

I will now turn the call over to Michael.

Executive
Michael Steinmann

Thank you Siren. Welcome everyone joining us today to discuss our results for the third quarter of 2019. Revenue in the quarter was $352 million primarily reflecting increased gold production and higher gold and silver prices. Revenue estimated at$17.8 million was not realized in Q3 due to timing of shipments resulting in inventory build. We expect the revenue associated with that metal inventory will be realized during Q4. Due to changes in market conditions and effective in Q3 2019 the Bell Creek and Timmins West mines are no longer classified as held for sale. As a result the Timmins assets and liabilities are no longer presented separately on the company's September 30 2019 balance sheet. And the net income generated by payments for the three months and nine months are reflected on the company's income statement in the normal course.

Net income in Q3 was $37.7 million or $0.18 per share. Net income included investment income of $36.1 million which was offset by $29.1 million of tax expense and a $15.6 million non-cash adjustment related to the reclassification of Timmins. Adjusted earnings were $74.2 million or $0.35 per share which is higher than GAAP earnings due to the adjustments related to the reclassification of Timmins and Indecipherable adjustment related to the Dolores Heap inventory and unrealized foreign exchange losses.

operating and growth needs. pay dividends of $7.3 million and repay $20 million dollars on the credit facility. Cash and short term investments ended the quarter at hundred and 77 million total debt for 360.5 million, including lease liabilities of $45.5 million, and