Pan American Silver shares slide on 2018 production slightly below targets
Shares of Pan American Silver (TSX, NASDAQ:PAAS), the miner that recently acquired precious metal miner Tahoe Resources, (TSX:THO) (NYSE:TAHO) creating one of the world’s largest silver producers, fell in pre-market trading after it reported full year production was marginally below guidance.
The Canadian miner said it had churned out 24.8 million ounces of silver last year, just shy of the 25-26.5 million ounces expected. Gold output, however, exceeded the company’s lower end of its 175,000-185,000 ounces target, totalling 178,900 ounces.
The company’s shares plummeted more than 7% to $13.18 in New York by 10:00 am local time and were trading 1.88% lower to C$17.79 in Toronto around the same time.
“2018 was a pivotal year for Pan American with low cash costs, strong cash flow, continued improvements at Morococha and Huaron, and positive impact to the bottom line from our La Colorada and Dolores expansions,” President and Chief Executive Officer Michael Steinmann said.
The executive said the acquisition of Reno, Nevada-based Tahoe Resources is expected to close at the end of February, which will effectively double its silver reserves.
Pan American, already the world’s second-largest primary silver miner, expects to produce between 26.5 million ounces and 27.5 million ounces of the precious metal this year, with gold output in the range of 162,500 ounces to 172,500 ounces.
Weak silver prices have taken a toll on miners’ shares in the past weeks. The precious metal just completed its worst year in three and has already erased its 2019 gains.