Fresnillo reaffirms production outlook, shares spark

(Sharecast News) - Shares in Fresnillo sparkled on Wednesday, after the blue chip miner shrugged off a dip in production to reaffirm full-year targets. The company, which owns eight gold and silver mines in Mexico, saw second-quarter attributable silver production fall 12.6% year-on-year to 10.9m oz, primarily due to lower ore grade at Saucito, a lower recovery rate at Cienega and the end of the contribution from Silverstream.

Gold production was also lower, down 1.9% at 154,800 oz. The decline was attributed to lower ore grade at Herradura and San Julian Veins.

Both were also lower compared to the first quarter.

However, by-products fared better, with lead and zinc production up 15.1% and 8.8% respectively in the first three months of the year.

Octavio Alvidrez, chief executive, said: "We have delivered a solid operational performance in the second quarter, driven by consistent execution across our asset portfolio. Our focus remains firmly on operational discipline and we remain on track to meet our full-year production guidance.

"Looking ahead to the second half of the year, our operational plans are tracking in line with expectations."

The miner is currently forecasting attributable annual silver production of between 42.0m to 46.5m oz, and gold in the range of 500,000 to 550,000 oz.

As at 1000 BST, the stock was up 3% at 2,637p.

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