Discovery Reports Fourth Quarter & Full-Year 2024 Financial Results
TORONTO, March 26, 2025 (GLOBE NEWSWIRE) -- Discovery Silver Corp. (TSX:DSV, OTCQX:DSVSF) ("Discovery" or the "Company") today announced financial results for the three months ("Q4 2024") and full-year ("FY 2024") ended December 31, 2024. All figures are stated in Canadian dollars unless otherwise noted.
Tony Makuch, Discovery's CEO, commented: "2024 was a transformational year for Discovery as we work towards becoming a highly profitable North American precious metals producer. Through the efforts of our team, today we stand poised to become a diversified gold and silver company, with a portfolio that combines growing gold production in the Timmins Camp, with tremendous upside, with our Cordero project ("Cordero") in Mexico, one of the industry's leading silver development projects.
"In February 2024, we issued the Cordero feasibility study (the "Feasibility Study" or "Study") results, which clearly established Cordero as a future industry leader. The project has a reserve of 302 million ounces of silver, will average 37 Moz of silver equivalent production in the first 12 years and will generate attractive economic returns. Very importantly, Cordero will provide substantial socio-economic benefits to Mexico, including creating thousands of high-quality jobs and providing billions of dollars in investment, local purchasing and tax revenue.
"Since releasing the Study, we have continued to de-risk the project. On that front, a significant milestone was achieved earlier this month, with the acquisition of the final parcel of land required for the development of the mine. The next key achievement for Cordero will be receiving approval of our environmental impact assessment (Manifesto de Impacto Ambiental in Spanish or "MIA"). Given an improved political environment in Mexico, we are increasingly optimistic that Cordero will complete the permitting phase and be advancing towards construction by the end the year.
"During the second half of 2024, our focus was largely on evaluating the potential acquisition of Newmont Corporation's Porcupine Complex, with an agreement being announced on January 27, 2025 (the "Acquisition"). Through the Acquisition, we are transforming Discovery into a new Canadian gold producer with multiple operations, a large base of Mineral Resources and substantial potential for growth. We know the Porcupine Complex well, with many members of our team being from Timmins and having direct experience managing these assets. We will bring to Timmins an overriding focus on value creation and a goal of re-establishing Porcupine as a Tier 1 asset in the global gold space.
"We are holding a special meeting of shareholders on March 27, 2025 to approve the issuance of shares to Newmont as part of the consideration for the Transaction and continue to work towards closing the Acquisition. Upon closing, we will move forward as a growing precious metals company with tremendous upside potential, significant leverage to both gold and silver prices, and a solid track record for achieving excellence in responsible mining. We will also have significantly improved financial strength resulting from a US$575 million financing package, arranged concurrently with the acquisition, including US$450 million of royalty, debt and equity financing from Franco-Nevada Corporation.
"The new Discovery is a company well positioned for success. It is success that will be achieved through an attractive combination of assets, a commitment to making these assets the best they can be, and a focus on investment that generates value for our shareholders and all stakeholder groups."
PORCUPINE COMPLEX ACQUISITIONThe Porcupine Complex consists of the Hoyle Pond, Pamour and Hollinger mine properties, the Dome mine property and milling facility (collectively "Dome"), and numerous former producing mines and legacy sites in Timmins, Ontario. The Complex also includes the Borden mining operation near Chapleau, Ontario. All mineralization from the operating mines is treated at Dome, including mineralization from Borden, which is trucked 190 km to the Dome plant.
Highlights of the acquisition include:
Establishes Discovery as a new Canadian gold producer with multiple operations in one of the world's most prolific gold camps, accounting for approximately 70 million ounces of total historical production, with a large base of Mineral Resources remaining and substantial exploration upside.
Adds growing gold production with anticipated average annual production of over 285,000 ounces during the next 10 years and a total expected mine life of 22 years with substantial upside potential.
Provides opportunity to unlock value with numerous opportunities identified to increase production and reduce costs at the Hoyle Pond, Borden and Pamour mines, the potential to upgrade a large Inferred Mineral Resource at Dome Mine (currently closed) and a commitment to invest in drilling to realize the significant exploration upside that exists in the Timmins Camp.
Allows Discovery's management team to apply its extensive experience working in the Timmins Camp to maximize the value of the Porcupine Complex, with over a century of collective experience in exploration, discovery, development and operation of deposits and mines in the area.
Attractive acquisition with Porcupine Complex expected to generate significant after-tax free cash flow and an attractive net present value ("NPV") at 5% discount rate.
Free cash flow of US$1.3 billion in first 10 years with NPV of US$1.2 billion at base case analyst consensus gold prices1
NPV of US$2.3 billion at a +23% sensitivity case using LT gold price of US$2,650 per ounce.2
Positions Discovery to build substantial financial strength through attractive US$575 million financing package and future production from the Porcupine Complex.
Establishes a diversified portfolio with the strength of the Porcupine Complex to support the financing, and ultimate development and operation, of Cordero.
All operating and financial estimates in this press release related to the Porcupine Complex are taken from the technical report entitled, "Porcupine Complex, Ontario, Canada, Technical Report on Preliminary Economic Assessment", filed under the Company's profile at SEDAR+ (www.sedarplus.ca) on January 28, 2025 and available on Discovery's website at www.discoverysilver.com.The report includes the results of a preliminary economic assessment which is preliminary in nature. It includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves and there is no certainty that the estimates will be realized.
________________________1 Project economics in the PEA were generated with a base case using CIBC World Markets Inc.'s December 2024 analyst consensus gold prices, including 2025: US$2,576/ounce; 2026: US$2,484 per ounce; 2027: US$2,437 per ounce; and a LT gold price of US$2,150 per ounce beginning in 2028.2 Sensitivity case involves gold prices +23% to the base case, including a LT gold price of US$2,650 per ounce.
CORDERO SILVER PROJECT
Feasibility StudyResults of the Feasibility Study for Cordero were released on February 20, 2024. Key highlights of the Feasibility Study include:
Large-scale, long-life, low-cost production: 19-year life-of-mine ("LOM") with average annual production of 37 Moz silver equivalent ("AgEq")3 in Years 1, 12, and average all-in sustaining costs4 under US$12.50 per AgEq ounce in Years 1, 8.
Attractive returns: NPV5% of US$1.2 billion at US$22 per ounce silver, which increases to US$2.2 billion in Year 4 when the Project reaches final completion to 51,000 tonnes per day.
Tremendous leverage to silver prices: NPV5% increases 92%, to US$2.3 billion, using current metal prices as of March 25, 20255 and grows to US$3.3 billion in Year 4.
Substantial benefits for Mexico: Total investment of US$1.4 billion, 2,500 direct jobs created during construction, peak employment of over 1,000 direct jobs during operation, an estimated US$4.0 billion of goods and services purchased and expected tax payments of approximately US$2.3 billion within Mexico (at current metal prices as of March 25, 2025).
Industry-leading environmental standards: Third-party reviews of proposed environmental practices completed to ensure compliance with industry-leading standards; US$130 million budgeted for site restoration and rehabilitation; and significant investment to promote green energy sources and to bring infrastructure and technology to improve water treatment in the area.
____________3 Please see the Technical Disclosure section of this news release for more information related to AgEq production.4 Non-GAAP Measure. Please see the Technical Disclosure and Non-GAAP Measures sections of this news release.5 Current spot metal prices as at March 25, 2025 include silver: US$33.60 per ounce; gold: US$3,020 per ounce, zinc: US$1.35 per pound and lead: US$0.95 per pound versus Feasibility Study prices of silver: US$22.00 per ounce; gold: US$1,600 per ounce; zinc: US$1.20 per pound; lead: US$1.00 per pound.
Recent DevelopmentsOn March 19, 2025, the Company achieved a significant milestone with the acquisition of 66 hectares of land near the planned location of the Cordero processing plant. With this acquisition, Discovery now owns 100% of the land required to advance Cordero into development.
SELECTED FINANCIAL DATA:The following selected financial data is taken from the Company's consolidated financial statements and related notes thereto (the "Financial Statements") for the year ended December 31, 2024 and the Management's Discussion and Analysis ("MD&A") for the quarter and year ended December 31, 2024. The Company's Financial Statements and MD&A are available at www.discoverysilver.com and on SEDAR+ at www.sedarplus.ca.
Q4 2024
Q4 2023
FY 2024
FY 2023
