First Majestic Reports Record Silver Production During 2025 Rally

Key Concepts

• Silver Equivalent Ounces (SEO): A standardized measure used to represent the total metal production of a mining company, converting all metals (silver, gold, zinc, lead, copper) into the equivalent amount of silver based on their respective market prices.
• All-in Sustaining Cost (AISC): The total cost of producing an ounce of silver, including operating costs, sustaining capital expenditures, and corporate overhead.
• Mine Throughput: The amount of ore processed by a mining operation in a given period (typically measured in tons per day).
• Capital Expenditures (CAPEX): Funds used by a company to acquire, upgrade, and maintain physical assets such as property, plants, buildings, and equipment.
• Preliminary Mine Planning Studies: Initial assessments to determine the feasibility and economic viability of developing a new mining area.

First Majestic Silver: Q4 2023 Production Update & 2026 Outlook

This report details First Majestic Silver’s fourth quarter 2023 production results and provides an outlook for 2026, as released on Thursday before the market open. The update was previously discussed with Keith Newmier and is further clarified here.

Q4 2023 Production Highlights

First Majestic produced 7.8 million silver equivalent ounces (SEO) in Q4 2023. This breaks down as follows:

• Silver: 4.2 million ounces
• Gold: 41,417 ounces
• Zinc: 14.2 million pounds
• Lead: 8.1 million pounds
• Copper: 235,900 pounds

Notably, the rising copper price is identified as a potential positive contributor to revenue, though not expected to be dominant. Record quarterly silver production increased by 70-77% year-over-year, largely attributed to the inclusion of Gateau’s silver production. Overall silver equivalent production increased by 37% year-over-year.

Exploration & Mine Development

The company continued its aggressive exploration program, completing 57,300 meters of drilling with 27 drill rigs active during the quarter. Positive exploration results at Santa Elena have led to the initiation of preliminary mine planning studies for the Santa Nino and Navad targets, aiming for integration into the district’s long-term life of mine plan. The Del Toro silver mine was sold to Sierra Madre for $60 million during Q4.

2023 Full Year Performance

First Majestic met its upwardly revised 2023 production guidance, achieving 15.4 million ounces of silver, within the range of 14.8 to 15.8 million ounces. Gold production exceeded guidance at 147,400 ounces versus a range of 135,000 to 144,000 ounces. Production increases were observed at multiple sites: Lascats (contributing to the overall jump), San Dimas (+19%), and La Encantada (+18%).

Management Changes

Manny Alahafi was promoted to President and Chief Corporate Development Officer, effective at the beginning of the year. This promotion is highlighted as positive news for the company.

Cost Structure & Guidance (2026)

The company projects a consolidated all-in sustaining cost (AISC) range of $26.15 to $27.91 per silver equivalent ounce for 2026. This seemingly higher cost is explained by the strong silver production and higher silver prices, which improve overall economics, but also reduce the silver equivalent conversion ratio, spreading costs over a larger number of SEOs. Using 2025 assumptions, the midpoint would be $23.60 per silver equivalent ounce.

Capital Expenditures & Expansion Plans

First Majestic plans to allocate $213 to $236 million in capital expenditures (CAPEX) for 2026, focusing on sustaining activities and expansionary projects. Key projects include:

• Santa Elena Plant Expansion: Increasing capacity to 3,500 tons per day.
• Lascats Mine Throughput Increase: Increasing throughput to 4,000 tons per day.
• Exploration Drilling: Planned 266,000 meters of exploration drilling, slightly exceeding the 265,000 meters completed in 2025.

Dividend Increase

The company increased its dividend per common share from 1% to 2% of net quarterly revenues.

Upcoming Earnings Release

First Majestic will release its full earnings report on Thursday, February 19th.

Conclusion

First Majestic Silver reported a strong fourth quarter and full year 2023, benefiting from increased production, rising silver prices, and successful exploration efforts. The company’s outlook for 2026 includes significant capital investments in expansion projects and continued exploration, positioning it to capitalize on favorable market conditions. The promotion of Manny Alahafi and the increased dividend further demonstrate positive momentum for the company.