Release Date: March 14, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Wheaton Precious Metals Corp (WPM, Financial) achieved record revenue, adjusted net earnings, and operating cash flows in 2024.
- Annual production exceeded the top end of guidance with 635,000 gold equivalent ounces produced.
- The company announced a 6.5% increase in its quarterly dividend, maintaining a leading payout ratio in the sector.
- Wheaton Precious Metals Corp (WPM) was recognized as one of the 2025 Global 100 most Sustainable Corporations and received an AAA ESG rating by MSCI.
- The company has a strong growth forecast, expecting a 40% increase in annual production to 870,000 gold equivalent ounces by 2029.
Negative Points
- Wheaton Precious Metals Corp (WPM) recognized an impairment charge of $109 million due to a decline in market cobalt prices.
- Gold production at Constancia decreased by approximately 18% in the fourth quarter of 2024 due to lower gold grades.
- Co-product production at Penasquito is expected to decline in 2025 as mining transitions to lower silver grade areas.
- General and administrative expenses are expected to increase to $50 million to $55 million in 2025, up from $40.7 million in 2024.
- The company faces challenges with the timing and ramp-up of new projects, which could impact production forecasts.
Q & A Highlights
Q: The market has been impressed with the dividend increase, but the payout is lower than the 20% to 30% range previously discussed. Is there a plan to increase it further?
A: Randy Smallwood, CEO, explained that maintaining a healthy balance sheet is crucial to take advantage of opportunities. The company aims to balance commitments and cash flow, and the dividend increase reflects their confidence in their growth profile.
Q: Could Wheaton deploy the same amount of capital in 2025 as in 2024, given the $882 million in contractual obligations?
A: Haytham Hodaly, SVP of Corporate Development, stated that Wheaton has historically deployed over $800 million annually on high-quality transactions. They see opportunities ranging from $100 million to $1 billion and will continue to pursue accretive deals.
Q: How should we think about production in the first half versus the second half of the year?
A: Gary Brown, CFO, indicated that production is expected to be 45% in the first half and 55% in the second half, with a bias towards the latter half due to mine startups and ramp-ups.
Q: Are there any seasonal impacts or maintenance downtimes to consider in Wheaton's operations?
A: Wesley Carson, VP of Mining Operations, noted that Salobo experiences a rainy season in the first quarter, but most other operations are not seasonally affected. There are no significant maintenance downtimes expected.
Q: With gold prices at all-time highs, will Wheaton focus more on silver streams?
A: Haytham Hodaly mentioned that while they would like to add more silver, it typically comes as a byproduct of polymetallic assets. Wheaton will continue to transact in a manner that ensures solid returns, regardless of commodity price fluctuations.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
