Hochschild Mining PLC (LON:HOC) said it finished 2020 in a net cash position for the first time in eight years thanks to higher precious metals prices and strong free cashflow generation.
The COVID-19 pandemic is still heavily impacting both of the countries the miner operates in, although precious metal price strength has continued through to the start of 2021.
The FTSE 250 group continues with its brownfield exploration programme across its portfolio to add further high-quality ounces to its resource base and to optimise early-stage projects, which will cost around US$34mln.
Production for 2021 is expected to come in at 360,000-372,000 gold equivalent ounces (oz), or 31-32mln silver equivalent oz.
The Inmaculada and San Jose mines are expected to deliver 223,000-228,000 gold equivalent ounces and 6.4-6.8mln silver equivalent oz respectively.
All-in sustaining costs for operations are estimated to be US$1,210-1,250 per gold equivalent oz, which includes a rise in mine development costs at San Jose to increase reserves and an increase in development at Inmaculada.
Grades at Inmaculada are expected to be lower due to the delay in mine development and permitting resulting from the COVID-related stoppages, the miner said.
In the year to December 31, silver production tumbled 42% to 9.8mln oz, while gold production fell 35% to 175,000 oz.
Revenue was 18% lower at US$621mln, with adjusted underlying earnings (EBITDA) down 21% to US$270mln. Net cash at year-end was US$21mln, from net debt of US$33mln in December 2019.
The final proposed dividend was 2.335 cents per share for a total of US$12mln.
Shares rose 5% to 229.84p on Thursday at the opening bell.