Fresnillo reports declines in gold, silver production
By Josh White
Date: Wednesday 23 Apr 2025
(Sharecast News) - Fresnillo reported a 9.7% quarter-on-quarter decline in attributable silver production to 12.4 million ounces for the first quarter of the year on Wednesday, including output from the Silverstream contract.
The FTSE 100 precious metals miner said the drop was mainly due to lower ore grades and processing volumes at Saucito, the end of mining at San Julián DOB, and reduced throughput at San Julián Veins.
Compared with the same period last year, silver production fell 8.4%, despite higher grades at Fresnillo and increased Silverstream contributions.
Gold production totalled 156,100 ounces in the quarter, a 23.5% fall from the previous quarter due to lower grades and reduced ore volumes at key assets including Herradura, Saucito, and Ciénega.
However, gold output rose 10.8% year-on-year, supported by higher grades, throughput and recovery at Herradura.
By-product lead and zinc production also declined sequentially, falling 10.9% and 12.8% respectively, as grades and volumes weakened across multiple sites and San Julián DOB ceased operations.
Compared to the first quarter of 2024, lead production was flat while zinc output declined, largely reflecting reduced contribution from San Julián and lower volumes at Fresnillo.
The company reaffirmed its full-year production guidance, expecting silver output between 49.0 and 56.0 million ounces, and gold production between 525,000 and 580,000 ounces.
Lead and zinc guidance was also maintained, at 56,000 to 62,000 tonnes and 93,000 to 103,000 tonnes respectively.
Fresnillo said it was still targeting total silver equivalent production of 91 million to 102 million ounces for the year.
The miner said its safety performance remained a top priority, with ongoing efforts to reinforce training and adherence to protocols as part of its zero fatalities objective.
It added that its production outlook for 2026 and 2027 remains unchanged.
"We have started 2025 in line with our expectations, delivering a stable operating performance and maintaining the momentum we achieved in 2024," said chief executive officer Octavio Alvídrez.
"Our full year guidance remains unchanged; silver production is down as anticipated, as we account for the impact of cessation of mining activities at the San Julián DOB, although we expect to see a stronger second half performance.
"Gold production is up on the same period last year, driven by a continued strong performance at Herradura, as well as the benefit of processing gold inventories accumulated in the previous period."
Alvídrez said that with those inventories now depleted, Fresnillo expected gold production to normalise in line with its guidance.
"Overall, our operations remain well-aligned with our plan, positioning us well to capitalise on stronger precious metals prices.
"Cost discipline remains a key focus, supported by a favourable Mexican peso-USD exchange rate.
"We are focused on sustaining our operational stability, maintaining our strong financial performance and delivering value to our stakeholders throughout 2025, with our core priority as always being the safety of our people and the well-being of our communities."
At 0817 BST, shares in Fresnillo were down 7.84% at 956.13p.
Reporting by Josh White for Sharecast.com.
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