Shares of the Fortuna Silver Mines Inc. (FSM) stock become bullish in the premarket trading session today on December 20, 2021. FSM stock price saw a push of 14.91% to reach $3.70 a share at the time of this writing. The stock was gloomy in the previous trade and went down by 1.23% at closing. Let’s understand the current momentum of FSM stock in depth.
What’s Happening?
FSM stock became hot among investors after the announcement by Fortuna that it has received a grant of a 12-year extension of the environmental impact authorization at the San Jose Mine, located in Oaxaca, Mexico, by Secretaría de Medio Ambiente y Recursos Naturales. Investors liked this news of FSM stock and responded positively.
Initially, the authority denied the appeal of extension by Fortuna. After continued discussions and technical evaluation, SEMARNAT acknowledged that the operation at San Jose Mine meets the environmental obligations under EIA. After the reassessment of Fortuna’s application, Fortuna received the extension grant on the existing EIA terms.
Earlier this month, San Jose Mine has been gone through 13 environmental audits by Procuraduría Federal de Protección al Ambiente. The audits were successful, and the mine had been declared safe for the environment.
Financial View of FSM stock:
According to third-quarter 2021 financial results, the company generated $162.6 million in sales in the third quarter of 2021. This represents a record increase of 95% as compared to $83.4 million in the same quarter of last year. The gold sales of $49.0 million from Yaramoko mine and $41.8 million from Lindero mine primarily contributed to this rise.
The company recorded a net income of $0.2 million or 0.00 per share of FSM stock in the recently reported quarter. The net income was $13.1 million or $0.07 per share in the same quarter of last year. The acquisition of Roxgold Inc. for $10.5 million and a $9.6 million settlement of the disputed royalty claim with the Mexican Geological Service led to this decline.
Adjusted net income of FSM increased from $16.1 million in Q3,2020 to $22.5 million in Q3, 2021. Adjusted EBITDA of FSM stock was $75.3 million in the third quarter of 2021. In the same quarter of last year, Adjusted EBITDA was $42.2 million.
Fortuna ended the third quarter of 2021 with $135.8 million in cash and cash equivalents. This represents an increase of $3.9 from December 31, 2021.
Wrap Up:
The extension of environmental impact authorization is a positive sign for the growth of FSM stock. The recent financial results reflect significant growth in gold sales from the previous year’s same quarter.
