Hochschild maintains full-year production guidance after Q1

(Sharecast News) - Hochschild Mining delivered 79,941 gold equivalent ounces in the first quarter, it said in an update on Wednesday, in line with expectations and leaving full-year production guidance unchanged at 350,000 to 378,000 ounces. The FTSE 250 company produced 58,021 ounces of gold and 1.8 million ounces of silver in the period, equating to 6.6 million silver equivalent ounces.

It said the Monte Do Carmo project in Brazil made progress, with 19% of detailed engineering now completed and an installation licence secured, enabling site work to commence.

Meanwhile, Hochschild finalised the sale of its Arcata and Azuca projects, streamlining the portfolio around core assets.

The company launched its 2025 brownfield drilling campaign across all operational sites, with results expected from the second quarter.

Environmental and safety metrics showed improvement, with the lost time injury frequency rate falling to 0.82 from 1.25 in 2024, and the accident severity index dropping significantly to 27.

As of 31 March, total cash stood at $83m, down from $97m at year-end 2024, while net debt increased to $248m, up from $216m.

The rise primarily reflected the timing of payments tied to community agreements, performance bonuses, and taxes.

Net debt-to-EBITDA remained conservative at around 0.6 times.

The firm said it was still targeting all-in sustaining costs of $1,587 to $1,687 per gold equivalent ounce for the year.

"Traditionally, the first quarter represents our lowest production period and 2025 has been in line with this," said chief executive officer Eduardo Landin.

"Pleasingly, Inmaculada has delivered a solid performance and we are seeing encouraging developments in Argentina, where the easing of exchange controls and the resulting currency weakness are expected to improve San Jose's cost position in the long-term.

"However, at the Mara Rosa operation in Brazil, performance has been temporarily impacted by adverse weather conditions, with heavier-than-usual seasonal rains continuing into April, along with carry-over delays in waste removal from the previous year."

Landin said the company had also encountered operational challenges related to its mining contractor, in an environment of increasing pressure on the availability of skilled labour, partly driven by elevated metal prices.

"In response, we have implemented a series of measures including the expansion of our waste removal fleet and, during the second quarter, we will accelerate waste removal.

"Production in the second quarter is expected to remain broadly in line with the first, but we remain confident in a recovery in production during the second half of the year and reaffirm our full-year production guidance."

At 0838 BST, shares in Hochschild Mining were down 14.67% at 260.25p.

Reporting by Josh White for Sharecast.com.