Wheaton Precious shares drop on earnings miss

The New York-quoted equity of Wheaton Precious Metals Corp. (Nasdaq: WPM: TSX: WPM) fell on Friday after the company overnight reported lower earnings and revenue, missing analyst forecasts for the fourth quarter of 2021.

Unphased by the equity performance, president and CEO Randy Smallwood tells MINING.COM in an interview, the company is generating strong free cash flow. WPM reported nearly $200 million in operating cash flow during the fourth quarter and a record $845 million during 2021.

The Vancouver-based precious metals streaming leader reported adjusted per-share earnings of 29.3c per share, down from 33.3 cents a year earlier, and missing average analyst earnings estimates for 31c per share.

Wheaton reported a 2.8% year-on-year drop in quarterly revenue to $278.2 million, impacted by the reduced volume of gold sales.

However, the annual production figure came in slightly above the midpoint of yearly guidance at an attributable 752,958 gold equivalent ounces (GEOs). That figure translates to 342,546 oz. of gold and 26 million oz. of silver.

“Wheaton generated record annual revenue and operating cash flow in 2021 as our diversified portfolio of high-quality, long-life assets delivered strong results. We are proud of the value we could return to our shareholders, resulting from our record-setting performance. Total dividends paid in 2021 increased by over 35% from 2020,” said Smallwood.

Cornerstone Mining’s Cozamin mine in Mexico will provide a silver stream to Wheaton for the life of the project. Credit: Capstone Mining.

WPM also remained focused on accretive growth and added five new streams to an already robust portfolio over the past three months alone.

“This additional growth is readily apparent in our ten-year production forecast, where we see annual production climbing to well over 900,000 GEOs,” said Smallwood.

“In addition to our financial and corporate development successes in 2021, Wheaton also made significant strides in bolstering our sustainability efforts while continuing to support community programs around our offices and mining partners’ sites.

“We substantially strengthened our policies and disclosure around our environmental, social and governance strategy, including aligning our approach with the most recent climate science to reach net-zero carbon emissions by 2050.”

WPM reiterated its 2022 production guidance of between 350,000 to 380,000 oz. gold, and between 23 to 25 million oz. silver. The five-year guidance through to 2026 stands at 850,000 GEOs, and over the 10-year frame, the aim is to achieve an annual output of 910,000 GEOs.

Smallwood said the strategic goal is to breach the million-ounce level someday, thereby consolidating the company’s position as the global leader in providing alternative financing for resource developers.

At press time, WPM shares last traded down about 2.56% at $47.87 in New York, giving it a market capitalization of about $27.63 billion (US$21.74 billion).