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Pan American Silver posts record buybacks as gold output lags
The miner returned $300 million in the second quarter, while gold production missed expectations and gold AISC ran higher.
Pan American Silver said it returned a record $300 million to shareholders in the second quarter, supported by stronger silver production and higher metal prices even as gold output weakened. The Canadian miner reported $1.1 billion in revenue, up 38% year on year, and adjusted earnings of $308 million, or $0.73 per share, which fell short of the $0.88 consensus and Jefferies' $0.92 estimate.
Silver output rose to 6.5 million ounces, at the upper end of quarterly guidance, with performance driven by operations including La Colorada and Juanicipio. Gold production came in at 165,900 ounces, below expectations, and the company pointed to that mix shift as gold is expected to land at the low end of its 2026 production range, with gold segment AISC at the high end.
Pan American kept its silver guidance for 25 million to 27 million ounces at AISC of $15.75 to $18.25 per ounce. For gold, it reiterated a production outlook of 700,000 to 750,000 ounces at AISC of $1,700 to $1,850 per ounce, while Jefferies said weaker output at Jacobina and El Peñon was pressuring results.
Jefferies calculated free cash flow of $319 million for the quarter, below a $339 million consensus, but noted shareholder returns accelerated sharply. The investment bank said buybacks totaled $224 million and dividends were $76 million, with buybacks nearly ninefold from $25 million in the first quarter, and the company declared a $0.184 per share quarterly dividend payable Sept. 4.
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