Telson Mining Corporation (CVE:TSN) (OTCMKTS:SOHFF) (FRA:TSGN) said that operational improvements, lower costs and increased metal prices, had led to a strong first quarter.
The company operates the Campo Morado polymetallic mine in Mexico and revealed that for the three months to end-March, mine operating profit had come in at C$5.25million, a huge uplift from the preceding quarter (4Q), which saw a loss of C$0.26 million.
Gross revenue for the first quarter was C$21.2 million, up from C$18.9 million in the fourth quarter of 2020.
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"I am pleased to see that all the hard work is paying off," said Omar Garcia Abrego, the company's chief financial officer, in a statement.
"Campo Morado operating figures have improved significantly over the last year, this, along with cost reduction initiatives and increased metal prices have resulted in strong results reported for Q1 2021.
"Overall, the company is now well-positioned to have a very successful year with funding secured for the completion of Tahuehueto's mine construction and the pending restructure of the company's debt which in my opinion, all provide the foundation to continue delivering strong results to our shareholders."
At Campo Morado, production of zinc concentrate in the first quarter increased to 11,013 tonnes compared to 9,974 tonnes in Q4, 2020, while the average realized zinc price per tonne increased to US$2,687 compared to US$2,360 in Q4, 2020.
All-in-sustaining costs for the period were US$90 per pound, well down from US$1.39 in the fourth quarter.
Campo Morado is currently producing at an average of 2,100 tonnes per day and is estimated to be Mexico's sixth-largest zinc producer.
The firm's Tahuehueto gold mine is currently under construction and is estimated to be 60% complete.
Telson recently announced a US$25 million syndicated funding package, and subsequently closed a US$8 million equity private placement and executed a silver streaming funding agreement with Empress Royalty.
The miner is targeting to start pre-production by the end of 2021 and ramping up to full production capacity during Q1 2022.
Contact the author at giles@proactiveinvestors.com