First Majestic hits silver output record, to spin-out non-core assets

San Martin mine. Courtesy of First Majestic.

Mexico-focused First Majestic Silver (NYSE:AG) (TSX:FR) announced Monday that production at its five operating silver mines in the Latin American country hit a record of almost 3.86 million equivalent ounces of silver for the second quarter ending June 30, up 18% year on year.

Total ore processed at the five mines stood close to 671K metric tons, up 5% compared to the first quarter of 2014, but flat in relation to the same period last year.

Average silver grades increased 6% in the second quarter of 2013 and relatively consistent with the previous quarter.  Combined silver recoveries averaged 68% during the quarter, up from 64% compared to the same quarter in the prior year and higher than the first quarter average of 66%. These improvements were primarily the result of higher recoveries at La Encantada and San Martin.

Keith Neumeyer, President & CEO of First Majestic, said in a statement the historic production rate was partially the result of a 59% increase in silver production at the San Martin operation, “due to higher milling rates following the completion of the recent plant expansion and an increase in silver grades.”

The miner also announced a spin-out of non-core exploration properties to Sundance Minerals.

The company stock was down almost 6% in New York this morning to $10.31 at 10:20 am ET.