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Silver Wheaton Reports Record Quarterly Production Results

VANCOUVER, November 5, 2012 /PRNewswire/ --


Silver Wheaton Corp. ("Silver Wheaton" or the "Company") (TSX:SLW) (NYSE:SLW) is pleased to announce its unaudited results for the third quarter ended September 30, 2012.

  • Record attributable silver equivalent production of 7.7 million ounces compared to 6.1 million ounces in Q3 2011, representing an increase of 26%.
  • While production was at record levels, silver equivalent sales amounted to 5.1 million ounces due to the timing of deliveries, with the difference attributable to an increase of 2.0 million payable silver equivalent ounces being produced in the quarter that will be recognized in future sales.
  • Revenues were US$161.3 million compared to US$185.2 million in Q3 2011, representing a decrease of 13%, attributable to a 14% decrease in silver prices from a year earlier with silver equivalent sales being consistent year over year at 5.1 million ounces. 
  • Net earnings were US$119.7 million ( US$0.34 per share) compared to US$135.0 million ( US$0.38 per share) in Q3 2011, representing a decrease of 11%.
  • Operating cash flows were US$128.7 million ( US$0.36 per share [ 1 ]) compared to US$167.2 million ( US$0.47 per share) in Q3 2011, representing a decrease of 23%.
  • Cash operating margin [ 1 ] was US$27.20 [ 1 ] per silver equivalent ounce, compared to US$32.11 in Q3 2011, representing a decrease of 15%.
  • Average cash costs [ 1 ] rose slightly to US$4.16 [ 1 ] per silver equivalent ounce, compared to US$4.12 in Q3 2011.
  • As at September 30, 2012, approximately 5.2 million payable silver equivalent ounces attributable to the Company have been produced at the various mines and will be recognized in future sales as they are delivered to the Company under the terms of their contracts. This represented an increase of 2 million payable silver equivalent ounces during the three months ended September 30, 2012.
  • At September 30, 2012, the Company had approximately $555 million of cash on hand and $400 million of available credit under its revolving bank debt facility. This cash and available credit, together with strong operating cash flows, positions the Company well to execute on its growth strategy of acquiring additional accretive silver and precious metal stream interests.
  • Declared quarterly dividend of US$0.07 per common share, representing 20% of the cash generated by operating activities during the three months ended September 30, 2012.
  • On September 28, 2012, the Company announced that it had closed the previously announced purchase from Hudbay Minerals Inc. ("Hudbay") of a precious metals stream from its currently producing flagship 777 mine ("777"), as well as a silver stream from their cornerstone development project, Constancia.  Initial production covering the period August 1, 2012, through September 30, 2012, from 777 totaled 733,000 silver equivalent ounces (139,000 ounces of silver and 11,500 ounces of gold).

"With the addition of production from Hudbay's 777 mine in the quarter, we produced a record 7.7 million silver equivalent ounces, putting us on track to reach our 2012 annual production forecast of 28 million ounces," said Randy Smallwood, President and Chief Executive Officer of Silver Wheaton. "Our diversified asset base once again achieved strong production, with notable contributions from Yauliyacu, Zinkgruvan, and Minto. While overall production was strong, payable silver equivalent ounces produced but not shipped during the quarter increased by 2 million ounces due to the timing of concentrate shipments, negatively affecting silver equivalent sales volume.  This increase included the new precious metals contained in base metal concentrates produced at the 777 mine as the concentrate storage and transportation system was being filled with materials mined after August 1st. It is very important to remember that these ounces will inevitably be sold, it is simply a matter of timing."

"During the quarter we paid out over $630 million dollars, including our first payment to Hudbay and our last payment to Barrick, and yet, we finished the quarter with $550 million of cash on hand. With this cash, a fully undrawn revolving credit facility of $US400 million, and strong forecast annual operating cash flow, we remain very focussed, capable and excited about our potential to continue adding additional accretive ounces to our portfolio."

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