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Endeavour Silver CEO Bradford Cooke on the outlook for silver prices and the company’s purchase of Aurico Gold’s gold and silver mining interests ...
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-- shares of endeavor silver are down about 3%.
After announcing that it's buying two silver and gold mining interests for more Rico in a move to expand its footprint in Mexico.
So here's a stock right now on volume of about a million shares here with us now on -- first on fox -- -- -- -- Brad -- he's the chairman and CEO of endeavor silver.
To talk -- this is huge news for you guys to be buying a brand new mine here.
With two operations there 250 million dollars.
What do you hope that this will -- -- you at a time when silver prices you've got -- coming out saying you know what silver prices -- want to do much for 2012.
Well in fact that's an opportunity for company like ours.
We've been -- a pile of cash in recent years based on the cash flow for our current operations and we have been looking for opportunity dislike this.
Just like this okay so here you've got your existing mines in the Durango state and the -- -- -- -- state.
And now you've got this new one and a Rico so when will this be accretive does it add money right your bottom line right away or do you have to wait a bit.
-- very much so it's accretive on almost all financial measures write off about.
-- -- a production basis it's slightly accretive on reserve and resource base is significantly accretive.
There are gold bugs and there are silver -- now what will be the driver you believe eventually for silver prices because if C.
Expectation is for silver which was kind of making that hit for their forty dollars an ounce and then it just didn't quite get there now hovering around thirty.
So -- people believe they'll go around 27 what do you think will be the catalyst to get it back up higher than thirty dollars.
Well to be honest we had a career last year so most of this year -- you spend consolidating those gains in the metal prices both school -- -- over.
We are looking ahead obviously to future years and we feel -- -- for a fundamental basis of the technical basis very strong reasons for -- to go higher.
OK so you're you're -- very much tracks the price of silver at the moment the Blue Line -- but you're managing to make a move to the upside here as we watch and I want just basic -- right now on silver in my hand is one of your silver coins from one of your minds it's got the imprint there.
And then this is a point from what.
188080.
-- 1880 how much.
Silver how many ounces in this one verses this one.
Well the the speed rails in your left hand -- -- twenty grams of silver and in your right hand is pure ounce or 31 grams silver.
31 grams okay so what is this worth today wealth through two bucks thirty simple 32 dollars.
It doesn't get a -- asthmatic characteristic because of the improvement at the stamp there we don't sell them they're collector's items collectors' items are.
That -- there's something I want our viewers to know about this company that makes it different from almost every other silver miner and that is.
That a lot of them -- the silver and immediately get it out there because they need the money for operations.
You hold -- to some of your silver and wait till the price opportunity is better -- -- how was it that you're able to do that in -- hedging kind of way.
-- one of the few -- producers primaries or producers who produce pure bullion.
And because we produce -- -- and we it can actually develop a sales strategy to sell or not sell depending on where we feel we aren't in the market.
And given that -- -- is particularly cyclic not just long term but seasonally.
We did take the view in the fourth quarter last year to stockpile -- metal.
Because of a significant correction in the process over that was -- correct view this sort did bounce back from 46 the 37.
But we did sell that inventory in the first quarter -- back -- the inventory -- again.
While I -- speaking the cyclical.
Electronics manufacturers.
Are experiencing perhaps.
A little bit of a Renaissance in buying.
So it's that cycle where companies decide we need new computers etc.
I hear everything from about announce to announce and a half of silver in an iPad.
Is there an opportunity there were you see that uptick in purchasing of electronics equipment and people say okay silvers we're something now.
I can do very short street answer to that if you go back to when -- this company in 2003.
Electronic off take worldwide was barely a 150 million ounces here we are eight years later.
And vessel -- take -- north of 250 million ounces per year a hundred million ounces of physical growth of electronic off taken me years incredible.
Hundred million ounces OK so if anybody needs to know what the driver might be it's probably electronics in that regard.
The -- to do so much business of course all your mines in Mexico your heavily exposed.
That's appreciated 7%.
Have -- to hedge against that.
No we don't heads the peso basically we have a natural hedging that we keep rules for cash and stayed in the US.
We are and you -- that we spend in the index since we don't need to keep a lot of cash and -- we'll tell me.
How you're gonna expand -- mean you're very exposed to Mexico -- looking elsewhere.
For new mines we are we we had a project in Chile last year -- exploration project and we're very actively trying to expand their footprint there.
Good to have you mr.
cook it's really nice to hear this story can have -- the stock is of course down as you know down 24% year over year but some would say.
Opportunity in silver thank you the -- -- come -- the -- become them.
Bradford -- salvage what Warren Buffett chairman and CEO of endeavor silver and that come -- -- absolutely come Oxfam government's going for the canal.
