• Operating Cash Flows: $234 million in Q2 2024; record cash flows of over $450 million for the first half of 2024.

• Gold Equivalent Ounces (GEOs) Produced: Over 305,000 year-to-date; 147,000 in Q2 2024, a 7% increase from Q2 2023.

• Revenue: $299 million in Q2 2024, a 13% increase from Q2 2023.

• Cash and Cash Equivalents: $540 million as of June 30, 2024.

• Undrawn Revolving Credit Facility: $2 billion.

• Adjusted Net Earnings: $150 million in Q2 2024.

• Quarterly Dividend: $0.155 per share, a 3% increase from the prior year.

• Production Guidance for 2024: 550,000 to 620,000 GEOs.

• Sales Volumes: 124,000 GEOs in Q2 2024, a 4% decrease from Q2 2023.

• General and Administrative Expenses: $10 million in Q2 2024.

• Warning! GuruFocus has detected 4 Warning Sign with WPM.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Wheaton Precious Metals Corp (NYSE:WPM) reported record cash flows of over $450 million for the first half of 2024, highlighting the effectiveness of their business model.

• The company remains highly liquid with $540 million in cash and a $2 billion undrawn revolving credit facility, providing strong financial flexibility.

• Wheaton Precious Metals Corp (NYSE:WPM) achieved a 7% increase in production in the second quarter of 2024 compared to the previous year, driven by strong performances at Salobo, Penasquito, and Antamina.

• The company has been ranked among the top ten in Corporate Knights 50 Best Corporate Citizens in Canada for 2024, reflecting its commitment to sustainability.

• Wheaton Precious Metals Corp (NYSE:WPM) declared a quarterly dividend of $0.155 per share, a 3% increase from the prior year, demonstrating a commitment to returning value to shareholders.

Negative Points

• Sales volumes decreased by 4% compared to the same period in the previous year, primarily due to timing of sales and changes in ounces produced but not yet delivered.

• The company recorded a $51 million expense due to the implementation of a 15% Global Minimum Tax, impacting net earnings.

• Gold production at Constancia decreased by 18% in the second quarter of 2024 compared to the previous year, due to lower grades from planned stripping activity.

• A conveyor fire at Salobo 3 caused a temporary halt in operations, potentially impacting production guidance.

• The company anticipates a slight decrease in silver grades in the second half of the year as mining shifts back to the Penasco pits at Penasquito.

Q & A Highlights

Q: Can you provide expectations for Salobo's production and grades for 2025 and 2026? A: Wes Carson, Vice President, Mining Operations: We anticipate a slight drop in grades over the next couple of years, but with the ramp-up of Salobo 3, we expect an increase in throughput. Production should slightly increase as Salobo 3 becomes fully operational.

Q: What types of deals are you currently seeing in business development? A: Haytham Hodaly, Senior Vice President - Corporate Development: We are advancing several opportunities, mainly in development stage funding. The opportunities are split between polymetallic projects with precious metal byproducts and precious metals companies. Most deals range from $100 million to $700 million, with some exceeding $500 million.

Q: How do you expect gold and silver production to perform in the second half of the year compared to the first half? A: Wes Carson, Vice President, Mining Operations: We expect a 52% production in the first half and 48% in the second half. Gold production may weaken due to lower grades at Salobo, and silver production might decrease as Penasquito moves back into the Penasco pit.

Q: What is the expected impact of the Salobo fire on production? A: Wes Carson, Vice President, Mining Operations: The fire's impact is estimated to be around 10,000 ounces, but it might be less as operations resumed quickly. The fire likely offset some of the outperformance seen in the first half of the year.

Q: How long does it typically take to complete a streaming deal from start to finish? A: Haytham Hodaly, Senior Vice President - Corporate Development: The process usually takes six to eight weeks, depending on whether we are proactive or reactive. It involves initial assessments, deep dives, site visits, and finalizing term sheets.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.