LONDON, December 5, 2014 /PRNewswire/ --
Silver Wheaton Corp. (NYSE: SLW). On November 12, 2014, the company announced its unaudited financial results for Q3 FY14 (period ended September 30, 2014). Click on investor-edge.com to read our free earnings review on Silver Wheaton Corp. (Silver Wheaton). During the reported quarter, the company generated revenues of $165.9 million, while on an adjusted basis its earnings fell by $0.02 per diluted share from Q3 FY13. The President and CEO of Silver Wheaton, Randy Smallwood, stated that the strength of the company's streaming model was once again highlighted in a challenging third quarter for precious metals.
Earnings Overview
During Q3 FY14, Silver Wheaton's revenue was slightly lower from the $166.4 million reported in Q3 FY13. The company's reported revenue fell short of Bloomberg analysts' forecasts of $172.9 million. In Q3 FY14, the company witnessed 11% Y-o-Y decline in the average realized silver equivalent price to $18.98, from $21.26 in Q3 FY13, which was offset by a 12% Y-o-Y increase in the number of silver equivalent ounces sold. Further, the company's attributable silver equivalent production in Q3 FY14 decreased 7% Y-o-Y to 8.4 million ounces (6.1 million ounces of silver and 35,400 ounces of gold), from 9.1 million ounces in Q3 FY13. Meanwhile, Silver Wheaton's attributable silver equivalent sales volume in Q3 FY14 increased 12% Y-o-Y to 8.7 million ounces (6.3 million ounces of silver and 36,700 ounces of gold), from 7.8 million ounces in Q3 FY13.
Silver Wheaton's Q3 FY14 earnings from operations fell to $81.6 million from $90.6 million in Q3 FY13. During Q3 FY14, the company's expenses and other income increased to $76.5 million from $12.0 million in Q3 FY13. Silver Wheaton's income before income taxes for Q3 FY14 stood at $5.1 million, compared to $78.7 million in Q3 FY13. Further, the company's Q3 FY14 net earnings declined significantly to $4.5 million, or $0.01 per share, from $77.1 million, or $0.22 per share, in Q3 FY13. On an adjusted basis, the company's net earnings decreased 6% Y-o-Y to $72.6 million, or $0.20 per share, from $77.1 million, or $0.22 per share. Analysts from Bloomberg had expected the company to report adjusted net earnings of $76.5 million, or $0.20 per share.
Mr. Smallwood said that while the company's business model was created to minimize the traditional risks associated with mining, Silver Wheaton is not fully immune to the impact of lower commodity prices. He informed that the lower pricing environment recently forced the operators of one of its smaller streams, Mineral Park, to face liquidity issues and subsequent bankruptcy. He added that this event resulted in Silver Wheaton executing a comprehensive review of its entire asset base, and as a result, the company recognized an impairment charge of $68.2 million relating to the Mineral Park and Campo Morado assets.
On the day of earnings release, Silver Wheaton declared a quarterly dividend of $0.06 per common share.
Stock Performance
On the day of the earnings release, November 12, 2014, Silver Wheaton's stock advanced 1.71%, ending the session at $19.01. Although the stock has moved both ways since then, the gains have outweighed the losses so far. On the last close, Thursday, December 4, 2014, the stock finished at $21.15, down 2.35%. The company's shares oscillated between $20.99 and $21.89 during the session. A total of 5.61 million shares were traded, which was below its three months average volume of 5.88 million shares. Over the last one month and since the start of this year, the company's shares have gained 22.82% and 4.75%, respectively. However, the stock has fallen by 0.98% in the previous three trading sessions. Shares in Silver Wheaton closed above their 50-day moving average of $19.75. Furthermore, the stock has a Relative Strength Index (RSI) of 57.68.
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