Pan American Silver - Q224 results: Steady progress

Pan American Silver (PAAS) delivered a robust set of Q224 results, with lower silver production offset by the stronger sales and commodity prices. This was coupled with good cost control in the gold segment and resulted in a 65% increase in mine operating earnings and 31% growth in EBITDA. Strong cash flow generation was the main highlight of the results, with free cash flow exceeding that of the whole of FY23. PAAS expects production to be more heavily weighted to Q4 and silver output to be towards the lower end of guidance. We have reduced our FY24e EBITDA by 3.6% but our valuation remains virtually unchanged at US$23.5 per share due to a slightly lower weighted average cost of capital (WACC).