Gatos Silver, Inc.

Revenue at the Los Gatos JV rose 40% year over year to $93.8 million in Q3 2024, helped by higher volumes and higher realized metal prices. JV cash flow provided by operations was a record $58.2 million, free cash flow was a record $42.6 million, and JV net income was $25.7 million versus $15.1 million in Q3 2023. At Gatos Silver, net income was $9.9 million, or $0.14 per share, versus $0.05 per share in Q3 2023; adjusted net income was $15.2 million, or $0.22 per share basic. For 2024, the company raised silver production guidance to 9.2-9.7 million ounces from 8.4-9.2 million, silver-equivalent production guidance to 14.7-15.5 million ounces from 13.5-15.0 million, and byproduct AISC guidance to $8.50-$10.00 per ounce of payable silver from $9.50-$11.50. Co-product AISC is expected to remain at $14-$16 per ounce of payable silver equivalent, sustaining capex is still guided at $45 million, and exploration/resource drilling spend at $18 million.

Dale Andres said the quarter was defined by strong operations, record cash flow, and major strategic progress on the planned First Majestic merger. He emphasized continued throughput gains, cost reduction initiatives, and a longer mine life that supports meaningful cash generation at different silver price assumptions. His tone was constructive and confident, with repeated comments that the business is improving operationally while also unlocking district-wide exploration value.

André van Niekerk highlighted another quarter of robust cash generation, with $58.2 million of operating cash flow and $42.6 million of free cash flow, both records for the JV. He noted that revenues rose 40% to $93.8 million, net income reached $25.7 million at the JV, and Gatos Silver reported $9.9 million of net income with $116.7 million of cash at quarter end. He also pointed out $54.2 million of distributions during Q3, an additional $40 million distribution after quarter-end, and that both GSI and the JV remain debt free.

There were no analyst questions on the call, so management did not face direct pushback on the quarter or the merger. The only incremental clarity came from management’s prepared remarks: the First Majestic transaction is expected to close in Q1 2025, and approvals are still working through Mexican antitrust and securities regulatory processes. Management also said the co-product AISC was slightly above guidance because actual realized silver prices are used in the calculation.