Miner Hochschild announces it's on track for 2013 silver target

Mining firm Hochschild has reported a solid third quarter and said that it was on track to achieve its 2013 20.0m ounces silver target. (Release)

Production in the period was good for the company, with attributable production of 5.4m silver equivalent ounces. Hochschild also got approval for its Inmaculada mill construction permit from the Peruvian government.

The precious metals producer says its financial position remains strong, with a total cash of about $345m (£215.9m) and minority investments valued at around $69m. Short term borrowings stood at approximately $90m for the period.

Earlier this month, Hochschild announced a 40 per cent binding agreement for the proposed acquisition of Pallancata and Inmaculada Minorities, which has a net cash consideration of $271 million. Ignacio Bustamante, chief executive officer commented: "We have had an exciting quarter with the Inmaculada Advanced Project receiving its mill construction permit, as expected, as well as the recent announcement of our proposed buyout of the International Minerals minorities in Peru." The acquisition will see minority shareholding in assets already controlled by Hochschild consolidated and will reduce average unit costs for the company. $72.8m has been raised in equity, with a $340m bridging finance facility.

In terms of unit costs for the full year 2013, the company maintained its interim results guidance of a zero to five per cent increase in Peru and a five to 10 per cent increase at San Jose in Argentina. Bustamante added that "Hochschild's cashflow optimisation programme continues apace and I am confident that we will be able to demonstrate significant savings at our Full Year results early in 2014."