First Majestic Silver profit rises on higher output

Tue Feb 26, 2013 8:40am EST
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(Reuters) - Canada's First Majestic Silver Corp (FR.TO: Quote) (AG.N: Quote), which backed out of a bidding war for Orko Silver Corp OK.V last week, reported a 5 percent rise in fourth-quarter profit on higher output and better silver prices.

Net income rose to $22.4 million, or 19 cents per basic share, from $21.3 million, or 20 cents per basic share, a year earlier.

The company had 11 percent more shares outstanding during the quarter compared with a year earlier.

Revenue rose 17 percent to $71 million.

The company said fourth-quarter production rose 22 percent to 2.56 million silver equivalent ounces, while average realized prices rose 2 percent to $32.42 per ounce.

Cash costs for the precious metal rose 16 percent to $9.26 per ounce.

The Mexico-focused company produced 9.1 million silver equivalent ounces in 2012, up 20 percent from a year earlier.

First Majestic lost out on the chance to acquire Orko Silver's La Preciosa project - the world's largest underdeveloped silver mine - as it did not match a rival offer made by Coeur d'Alene Mines Corp (CDE.N: Quote) last week.

First Majestic owns two mines close to the La Preciosa mine in Durango, Mexico, with a production capacity of about 7 to 9 million ounces of silver annually.

Shares of the Vancouver-based company closed at C$17.79 on Monday on the Toronto Stock Exchange. Its New York-listed shares closed at $17.35.

(Reporting by Krithika Krishnamurthy in Bangalore; Editing by Don Sebastian and Roshni Menon)