Silvercorp Metals Inc. (NYSE-A/TSX: SVM; FRA: S9Y) reported a 13% increase in revenue to US$81.3 million in the first quarter of fiscal year 2026. This growth was primarily driven by a 5% increase in silver production (1.83 million ounces) and nearly doubled gold production (2,050 ounces). Additionally, significant price increases for silver (+12%) and gold (+45%) contributed. Lead production also rose by 1%, while zinc output decreased by 19%. Overall, approximately 2.0 million ounces of silver equivalent were produced.
Earnings Decline Due to Special Charges and Increased Costs
Net profit decreased year-over-year from US$21.9 million to US$18.1 million (US$0.08 per share). The primary cause was a one-time charge of US$4.8 million from the valuation of derivative liabilities, as well as the issuance of 38.8 million additional shares following the Adventus Mining acquisition. Adjusted for special items, profit was US$21.0 million (US$0.10 per share) – almost at the previous year’s level. All-in Sustaining Costs (AISC) rose by 37% to US$13.49 per ounce of silver, primarily due to higher production costs, additional administrative expenses, and new mineral rights fees in China.
Solid Cash Flow and Strong Liquidity Base
Operating cash flow significantly increased by US$8.3 million to US$48.3 million, while free cash flow at US$22.5 million was only slightly below the previous year’s figure. Silvercorp invested US$18.8 million in exploration, development, and equipment in China, as well as US$5.4 million in projects in Ecuador, including the construction of the El Domo mine. At the end of the quarter, the company had cash and short-term investments totaling US$377.1 million, along with an equity portfolio valued at US$72.2 million. Additionally, a financing commitment of US$175 million is available for the El Domo project.
