Lower silver prices takes shine off Hochschild profits

Hochschild Mining on Wednesday posted lower interim pre-tax profit, due to a fall in the average silver price which led to lower production.

Post-exceptional pre-tax profit fell to $29.5m (£24.5m) from $38.6m as the average price of silver fell 7%, offset by a 2% rise in the gold price.

First-half attributable production was 245,325 gold equivalent ounces or 19.9m, compared with 256,939 or 20.8m respectively last year.

The company said it remained on track to deliver overall 2019 production target of 457,000 gold equivalent ounces and all-in sustaining costs in the range of $960 - $1,000 per gold equivalent ounce.

“In mid-June, the gold price started to rise significantly on the back of global uncertainty and a fall in the US dollar and reached levels not seen in six years,” said chief executive Ignacio Bustamante said.

“Silver also rose in July and therefore we expect the company's second half cashflow generation to be healthy provided the price strength is maintained.”