First Majestic: Built for the New Silver Supercycle
Summary
Silver Bullishness: The guest argues silver is early in a multi-year upcycle, citing sustained breaks above $30-$40 and a gold-silver ratio far above mined supply ratios implying room toward higher prices.
Key Company - First Majestic (AG): Pitched as a leading pure-play silver producer with ~55% silver exposure and 30–32M silver-equivalent ounces, strong balance sheet (~$500M cash, low debt), and focus on accretive growth.
Acquisition - Gatos Silver (GATO): The ~$970M deal was highly competitive and accretive at $24 silver, with meaningful synergies from integrating a single-asset producer into First Majestic’s Mexican portfolio.
Mexico Jurisdiction: The guest is bullish on Mexico as the top global silver jurisdiction, noting improved permitting and government relations under the new administration and adjacency-driven operational synergies.
Silver Miners Theme: Emphasis on scarcity of primary silver producers (few with >50% silver revenue) and the strategic value of scale, purity, and disciplined M&A to extend mine life and enhance production.
Operational Upside: San Dimas, Santa Elena, and Los Gatos are cornerstone assets, with exploration and resolved labor issues aiming to lift output 30–50% at San Dimas by targeting higher-grade veins.
Vertical Integration: The company’s Las Vegas mint enables 7–10% of output to be sold at premiums over spot, boosting margins and meeting strong retail and institutional bullion demand.
Market Outlook & Risks: The guest sees persistent deficits and industrial demand supporting silver, while noting challenges in finding high-quality deposits and maintaining primary silver purity.
Transcript
Finding silver is tough and why is it getting depleted? Having good silver deposits is is really hard to come by and we're blessed. You know, first has got three large large scale districts of silver. You know, for every 1 oz of gold, we're only mining 7 ounces of silver. >> Yet the price ratio is sitting at 84 to1. Okay. It's improved from 100. It was 100 to1. Now it's come down to 84. >> Mhm. >> That's still, you know, nowhere near the mining ratio. Mhm. >> So if you bring that down, not even to historic, but take it to 40 to1. >> Mhm. >> That's a $100 silver right there. >> Well, greetings and welcome to our Wealthon show. My name is Trey Reich and we're here at the SCP Wealthon Silver Conference at the Shanganger Hotel in Toronto. Getting about halfway through the day. been excited to speak with Eric Sprat this morning uh and some great presenters, but we are now with Manny Alkafagi uh vice president of corporate development uh at First Majestic Silver, which is certainly up there in the pantheon of silver mining companies from whom we want to hear. So Manny, thanks for coming. >> Thanks Trey. Appreciate you having us. >> Mhm. Excellent. So, as I was talking about the pantheon of silver companies, I thought it would be a great place to start to ask you where does First Majestic sit in terms of relative uh size of production and reserves >> in that big picture? How big are you? >> Yeah. Well, uh you know, we are the purest uh silver company right now and it's getting really hard to remain a silver company. you know, companies have the word silver in their name, yet their purity is, you know, barely double digit these days. Uh, so as of end of uh Q2, our silver exposure was 55%. 1/3 of that and, you know, 1/3 is gold and the rest is uh lead and zinc. Uh, we're producing 30 to 32 million silver equivalent ounces. So, you can, you know, grasp how large that really is when you get, you know, more than 50% of your value coming from silver. um with the way silver is running right now, that can only increase uh further. So, we're sitting in a pretty uh pretty comfortable position. The company has grown quite a bit in the last little while, which I'm sure we can talk about that. But, uh >> and by the way, there's no gold, just silver, lead, and zinc. >> No, no. So, uh silver is the majority. Uh gold is 1/3. Uh so, about 33 35% >> and about 10% is basically lead and zinc. So, 90% precious metal. Um having the gold in the portfolio has been quite nice to be honest just given the stability and really uh helping us the the the gold is covering the bills pretty much. Uh silver has just been you know an exciting run. We've obviously closed our largest transaction earlier this year and with Gatos silver and that brought that you know the timing of that could not have been any better. >> Um yeah so this is uh this is us right now 22 years in the making and uh we just celebrated uh yeah our anniversary a couple months ago. >> Mhm. So going back to something that you said for viewers, if you take the the largest producers of silver are companies like BHP, Bilitin etc. But if you look at primary silver producers and you go to the selective silver miner index and you screen for 500 million in market cap and 20% silver revenues, how many do you think there are? The answer is 15 companies of which you're one. And the average uh silver revenue percentage for the entire group is 48. >> So >> that's below that's that's below 50%. You know, >> it's still below 50%. >> Yeah, that's that that's the problem right now. Like you know, finding silver is tough and miser getting depleted. Having good silver deposits is is really hard to come by and we're blessed. You know, First Mesa's got three large large scale districts of silver uh silver districts. Um, so you know, it took us a long time to build this and to keep the purity above 50%. It's challenging. Uh, but like I said, you know, we're in the right jurisdiction. We're in Mexico. That's the number one producing jurisdiction in the globe. And, uh, you know, we, uh, we're one of the top producers in Mexico and, you know, the larger one globally as well. >> So, you brought up a lot there. So, let's look at the Mexico part. Uh about a year ago or so, if I have it correct by memory or a year and a half, there was a big jump in concern about open pit mining and mining in general in Mexico that seems to have uh calm down with Claudia Shinb as the new president. How would you rate the uh the Mexican political environment? >> Yeah, I mean it's it's definitely been quite topical the last few years. You know, under Amllo things were very challenging. uh you know first just like we're blessed obviously we're we're a producer we're not chasing any new permits we don't have any green fields projects so it didn't really impact us uh but you know we obviously pay attention to the industry and it was challenging a lot of the juniors >> um you know Shyam has uh you know come in recently and uh it's been night and day like night and day in terms of just dealing with the different uh legs of the government the you know we haven't been waiting for any critical permits but We did receive a couple of permits that we have been waiting on you know simple stuff you know [snorts] change of tailing use or whatnot but again that was a good sign and that really gave us the comfort to really invest back in Mexico you know we just you like I said closing the largest transaction in the company's history in Mexico we paid 970 million for gate silver >> and we would not have done that you know under the previous regime. >> Got it. We're going to get to the projects in a minute, but my last general introductory question is one that uh I'm very loyal to that Rick Rule taught me, which is whenever you're talking to the senior management of a precious metals company, it's important to identify what is the corporate mission statement. So, what when people buy First Majestic Silver, what do you want them to be thinking about? >> Silver, you know, that's that's our exposure. We do want to get larger. We want to be the largest silver pure silver company. Um it's obviously a tall ask. U you know there's there there are bigger ones out there but that's our mission. We do want to keep growing. Uh company's been built really on successful accretive M&As. You know we do have a large land package. So our organic growth is there and we do have a couple of pipelines in the project or in the in in the pipe. >> But uh we're always going to continue looking for silver uh silver assets. um you know where they are is is key. You know we're not going to take risk. We're not going to >> uh operate in area that we're not comfortable in. Uh so that's that's our focus. Keep growing, keep being becoming or you know adding more profit to the bottom line and that's what the that's what our shareholders love about us. >> And along those lines you closed the acquisition of Gatau Silver I believe in January of this year. >> Um so I always I have two questions about that. Number one, in the mining industry, when you buy something, you think you know what you're buying, and then you get what you get, and there's frequently a disconnect between those two. With Gats, did you get what you thought you were buying? >> I think we got more than what we thought we'd be getting. Tell us about it. >> You know, so Gats, uh, that transaction was very competitive. You know, it took about a year from initial conversation to close. Uh you can imagine, you know, there was 13 companies involved right off the bat in in a competition >> in a compet. So it was it was a competitive process run by run by the banks and you can imagine multiple rounds of bidding, multiple site visits. >> Wow, that's a that's a big number. >> Yeah. Yeah. So you can tell there was a lot of interest. >> Um you know, we're very obviously glad that we were the successful bid at the end. >> Mhm. But to give you an idea, you know, we did our analysis at $24 silver at the time and it was a creative on all, you know, we have a list of KPIs that we track, you know, from what kind of reserve it's adding, what kind of production, what kind of cash flow. It was a creative on all fronts at $24 silver. >> So, you can imagine how things are looking right now soon after closing it. Uh, so we're, you know, we're we're quite happy. Uh there was a number of M&As that happened soon after ours and uh you know we we were very happy with how ours you know what we paid what we got. Uh >> did you pay top dollar at the time or how did you win paid by paying a rich >> Yeah. I mean like >> price which turned out to be a a bargain given where we are now. >> The price is obviously one thing. Um but so the the the founding shareholder of Gatos was Tom Kaplan from the Electrum Group. Ultimately it was his decision really. He wanted to he wanted a liquidity event and First Majestic's liquidity is unmatched. You know, we trade about $200 $250 a day. You know, the whole float. We we trade the whole float every month basically. >> He took a bunch of stock obviously. >> Absolutely. >> Still owns a bunch. >> No, he's [clears throat] he's out now, but uh he's done quite well with uh he's invested. He's got a few other assets that he's putting it back in which we watch closely as well. >> But it was a it was a great uh you know, great story for him. great to have him as a shareholder and you know great that we got gats you know through him effectively >> and that's uh you know they look at uh that's one of the stuff but ultimately as well >> a single asset company doesn't matter how good the asset you have there's always a risk it's nice to put this asset in a portfolio >> and what's a better portfolio than a Mexican portfolio that's been existing for two decades >> if you look at the Mexican map u we have four assets right now >> and Gatos got slotted right in the middle of So, we're all in adjacent states, four assets in four adjacent states and just a lot more synergy that's being unlocked right now, you know, from group purchases to exploration contracts to just moving people around and that's something that a single asset company cannot have. It's unmatched. Um, so I think this the conditions of the market all that worked out being, you know, for first suggest being the ultimate wouldn't bid. >> Excellent. Well, congratulations on that. As uh Pierre Lassand always says, it's good to be lucky. Thus the name lucky Pierre. So >> Oh, there you go. >> There you go. It's good to have a little bit of luck in in in timing. >> So, uh there are three other operating minds, correct? And >> uh I guess to me the the backbone is Sand Demus. Um I I think I read that it's >> in that area has been in production for 250 years. Did I read that right? >> Absolutely. >> Mhm. Yeah. Yeah, look, we we really have three cornerstone assets right now. They're all kind of plus or minus, you know, 5 10% [snorts] from each other. >> Okay. >> Uh Sand Deas is uh shooting about 10 11 million ounces this year. >> Santalena's, you know, something in in that range as well. 9 to 10. Lasato, so Lasato at 100% produces 13 to 15 million. We have a 70% stake in that. So we'll get about 9 10 million out of that. >> Uh but Sandeas still remains to be our largest. Um and in our view it's it's under underperforming. It's doing great. It's cash flowing but we think we can do about 13 to 15 million. So you know it's about 30 to 50% improvement in the production in the next couple of years. And we see that >> and what will achieve that uh improvement is just c a lot of capital involved or >> it's exploration. Um so we've had some labor issues a couple years ago which you know did was a bit of a drag on production. That's been resolved. Um, so we're we're it's it's great to see throughput elevated again and you know production is coming up just from that stance. But we've always been targeting these tier one veins is what we refer to. So u exploration team is basically deployed a new strategy in the last little while. We put out an exploration update a couple of months ago. It shows some really exciting stuff. So we'll be following up. But our theory in the next 18 to 24 months, you know, we'll be able to target hit this tier one vein, get it into production, and you know, throughput is there, which is great. But if you combine that with higher grade, then, you know, that's just gravy. You know, it's it's your cause doesn't change really, but uh your your efficiency improve and you're getting a lot more metal for the same time that you're processing. >> And what's your balance sheet look like? >> Strongest as ever and keeps getting better and better as you can imagine. >> Mhm. you know, we have over 500 in the bank right now, 500 million [clears throat] uh in treasury. Uh, you know, very low debt, you know, net cash position. Um, and that's that's growing. You know, the end of, uh, June 30th, that's the last public information. We had 510 million. Uh, we'll be updating our we'll be providing our Q3 financials on November 5th. So, uh, you know, people will see what that looks like. Right now, >> this October, Wealthian's putting the spotlight on silver with expert interviews, deep analysis, and a special in-depth report from our partners at SCP Resource Finance. To receive this report and other exclusive benefits, you can sign up to become an accredited investor with Wealthon at wealth.com/acredited or by finding the link in the description below. Speaking of silver, Wealthon will be on the ground in Toronto for the SCP Resource Finance second global silver conference. Legendary investor Eric Sprat headlines the event alongside 15 silver mining companies presenting their top projects. Find out more in the description below. >> Um, and is Keith and the team interested in perhaps participating in M&A? I mean it's a stupid question cuz I you know if something comes along I understand but are you I assume you're open to that uh option. >> Oh sure like I mentioned 22 years and the company's been built on M&As. It's uh >> it's funny in the last >> and Keith is never satisfied. So >> in the last 10 years we seem to have done an acquisition every 3 years. >> Um we're always looking you know it's uh we have >> you know I think 18 or 19 NDAs signed in place right now. We have our eyes on, you know, a couple of interesting ones, but to us, you know, we're we're very selective in what we uh, you know, what we what we go after. Um, we're not going to go and buy a junior green field assets. >> I was just going to say at SCP resources, we focus sort of on the explorers and the developers because it is an exciting place to be when But that's not what you're looking for. >> It's the pipeline, right? So we keep an eye on but it doesn't do us any favor taking on that risk right now. We'd like to get involved at a later stage have a deer asset whether it's permitted maybe in construction development. That's really the the sweet spot for us. Um and we've done we've proven that like I said >> you know Santelena was purchased 10 years ago um in 2015 and it was producing 2 and a half maybe 3 million ounces. >> 10 years later and the mine had a 7-year life of mine 10 years ago. 10 years later, the mine has, you know, eight to nine years life of mine. Production went from two and a half to 10 million ounces. >> So quadruple production, extending life of mine. That's what First can bring to, you know, these kind of assets. Um, but yeah, we're looking, we're not stopping. It needs to be silver. And that's that's what we started off saying. It's tougher and tougher finding these assets. >> Excellent. So, uh, I'm fairly pretty familiar with Keith's sort of corporate, uh, culture about the silver price, and I think he's about as bullish as Eric Sprat, who's one of the big long-term bulls. But in terms of of what you guys look at the market, do you think it's too late to get involved in silver given its run, or do you what inning do you think we're in? >> This is a very different market right now. you know, silver broke through 30, $30. You know, this was the third time it's ever done that, right? Um, and the last couple of times it was a very quick blip. You know, it broke through 30 and right straight to 50. This time is a little bit different. You know, it kind of hovered. It took it a while to break through 30. Once it did 30, it sat there for a little while, consolidated, then 35 became the new resistance again. >> 40 quick, >> 40 quick, but it, you know, 30 comfortable, 35 comfortable, hovered around 40 for a while as well. So, uh, you know, I think this is really just the start of this, uh, this cycle. You know, we're going to be it's going to be around for, you know, few more years. And, uh, >> you listen as well to what we're, you know, what Eric said this morning. We're mining 7 to1. You know, for every 1 oz of gold, we're only mining 7 ounces of silver. >> Yet the price ratio is sitting at 84:1. Okay. It's improved from 100. It was 100 to1. Now, it's come down to 84. >> Mhm. >> That's still, you know, nowhere near the mining ratio. Mhm. >> So if you bring that down, not even to historic, but take it to 40 to1. >> That's $100 silver right there, just holding gold the way it is. So you hear Keith and others now are are saying tripledigit silver. >> That's where that rational comes from. >> Eric also touched, you know, initially or you know back in the day the ratio this the price ratio was 12 or 15 to1. Well then you can only imagine what silver would be if nothing happens in gold, right? Like if all the geopolitical issues have been resolved and gold is not going to go up anymore, which no one's really believing. But if you hold gold the way it is right now, silver is, you know, has a lot more to go. >> Rick uh rule has, you know, this pretty ar pretty difficult to argue with theory that the US dollar is due over some period of time 75% depreciation. you know, if you want a bench clearing number and that implies gold should be a three to one and silver should sort of be double that, you know, so six to one is sort of out there uh if all of these macro factors uh continue to develop as as quickly as they have. Um are you surprised silver's done this well? >> Uh I don't not that it's done this well. I think it just took it a while a long time to catch up, you know, and we're still we just hit >> all-time high just now. >> You know, gold is double its all-time high, >> you know, that they both hit in 2011, right? >> You know, so uh we I think everyone understands that theory that silver, you know, takes but it's it's more like a slingshot, you know, it takes a while for it to really catch up, but once it catches up to gold, it'll outperform. And I think we're starting to enter that that phase right now. So yeah, >> I have sort of a funny footnote question that I've always wondered. You know, we read a lot about the industrial demand and how solid photovoltaic blah blah blah AI, you know, the industrial demand 59 four years of deficit. When it gets like this, when you guys sell your silver, do you notice like do industrial buyers start sort of bidding you up or not really? it just goes into the market and >> yeah, we don't have the visibility on the spot component of the silver. What we've done differently and we're the only mining company that does that has that now we build our own mint. >> So now we're minting we're minting our own silver. Now this is the same silver that's coming from >> talk about it. >> Las Vegas. So it's in Las Vegas. It's, you know, it's it's a great jurisdiction. You know, you got the airport right there. International uh distribution and domestic and very secure, very safe area. >> So how does that work? You ship yourself the >> door or >> correct? So we we it still gets refined by a third party refinery in uh in Salt Lake City and then basically gets transport transported to to Vegas where you know we grain it and then turn it into different kind of products >> and uh you know we firstic has been doing that for a while uh but we've always used third party mints but what we realized in the last couple of years is you know demand is far exceeding supply. we've not been a the third party mints weren't able to supply the products. So we said screw this, you know, just go on full vertical integration, build our own minting facility. Very tough, very secretive. So there's not much. So we had to learn all that. But we're blessed to have, you know, have had that vision. Keith has had that vision and we've executed executed on it. So >> we comm commissioned it last year. >> And the timing right now could not have been better. The >> So that gives you the flexibility to sell to a wider group of those that are normally bidding in the spot market. >> Pretty much. Yeah. private sales to billion dollar family offices that have is that amount >> that's pretty much it. Yeah. So we right now we got 7% of our production going through this facility and we're targeting [clears throat] 10%. >> Just the last you know this whole frenzy that's going on you know a lot of retail guys are buying and you know we're in conversation with some big players that want to buy big chunks and just just hoard it just sit on it. So, uh, I think that's going to be a pretty interesting avenue coming through. And, uh, we we've seen the sales, you know, going through record times once when silver hit 50. You know, you'd expect people are buying when it's lower, but I think this FOMO, uh, feeling right now, >> especially with silver, >> that's the thing. >> Very emotional. >> Yeah. And it's uh, it's great and people are, you know, whoever is buying, they're still making money and our premium are still pretty reasonable. So my last naive question about the mint, is there a profit boost there or is it just control of your markets that you're after? >> No, it's >> there's a margin there. >> Definitely. Yeah. Yeah. So, you know, with that we're able to charge, you know, anywhere from three to five to six bucks. Sometimes we'll do special runs where we'll charge >> We're talking over spot. >> Overspot, correct? Yeah. So, whatever spot is, you know, we're always going to tack on that that premium, >> you know, competitive premium, we're able to do that and we're still making money. That's still our silver. It's costing us $178 anyways to make. Instead of selling it for 50 bucks, we're selling it for $55 now. >> So, what's the payback on the investment >> already done? >> Yeah, >> that's a good idea. >> Yeah. Yeah, it's great. And uh, you know, we're again, like I said, lucky to have, you know, we we uh we have the right operators in place as well right now. So, scaling it up and just really meeting this demand has been pretty u pretty exciting and uh, you know, nice to see. >> Terrific. Well, uh, thank you very much, Manny, for taking the time to visit with us. Sounds like a very exciting story. Uh we'll keep our eyes on you and look forward to catching up in a few months. >> Absolutely. Thanks, D. >> Terrific. Thanks for coming. >> Yeah. >> Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.comfree. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. Thank you all for watching. We'll see you again next time. >> [music]
First Majestic: Built for the New Silver Supercycle
Summary
Transcript
Finding silver is tough and why is it getting depleted? Having good silver deposits is is really hard to come by and we're blessed. You know, first has got three large large scale districts of silver. You know, for every 1 oz of gold, we're only mining 7 ounces of silver. >> Yet the price ratio is sitting at 84 to1. Okay. It's improved from 100. It was 100 to1. Now it's come down to 84. >> Mhm. >> That's still, you know, nowhere near the mining ratio. Mhm. >> So if you bring that down, not even to historic, but take it to 40 to1. >> Mhm. >> That's a $100 silver right there. >> Well, greetings and welcome to our Wealthon show. My name is Trey Reich and we're here at the SCP Wealthon Silver Conference at the Shanganger Hotel in Toronto. Getting about halfway through the day. been excited to speak with Eric Sprat this morning uh and some great presenters, but we are now with Manny Alkafagi uh vice president of corporate development uh at First Majestic Silver, which is certainly up there in the pantheon of silver mining companies from whom we want to hear. So Manny, thanks for coming. >> Thanks Trey. Appreciate you having us. >> Mhm. Excellent. So, as I was talking about the pantheon of silver companies, I thought it would be a great place to start to ask you where does First Majestic sit in terms of relative uh size of production and reserves >> in that big picture? How big are you? >> Yeah. Well, uh you know, we are the purest uh silver company right now and it's getting really hard to remain a silver company. you know, companies have the word silver in their name, yet their purity is, you know, barely double digit these days. Uh, so as of end of uh Q2, our silver exposure was 55%. 1/3 of that and, you know, 1/3 is gold and the rest is uh lead and zinc. Uh, we're producing 30 to 32 million silver equivalent ounces. So, you can, you know, grasp how large that really is when you get, you know, more than 50% of your value coming from silver. um with the way silver is running right now, that can only increase uh further. So, we're sitting in a pretty uh pretty comfortable position. The company has grown quite a bit in the last little while, which I'm sure we can talk about that. But, uh >> and by the way, there's no gold, just silver, lead, and zinc. >> No, no. So, uh silver is the majority. Uh gold is 1/3. Uh so, about 33 35% >> and about 10% is basically lead and zinc. So, 90% precious metal. Um having the gold in the portfolio has been quite nice to be honest just given the stability and really uh helping us the the the gold is covering the bills pretty much. Uh silver has just been you know an exciting run. We've obviously closed our largest transaction earlier this year and with Gatos silver and that brought that you know the timing of that could not have been any better. >> Um yeah so this is uh this is us right now 22 years in the making and uh we just celebrated uh yeah our anniversary a couple months ago. >> Mhm. So going back to something that you said for viewers, if you take the the largest producers of silver are companies like BHP, Bilitin etc. But if you look at primary silver producers and you go to the selective silver miner index and you screen for 500 million in market cap and 20% silver revenues, how many do you think there are? The answer is 15 companies of which you're one. And the average uh silver revenue percentage for the entire group is 48. >> So >> that's below that's that's below 50%. You know, >> it's still below 50%. >> Yeah, that's that that's the problem right now. Like you know, finding silver is tough and miser getting depleted. Having good silver deposits is is really hard to come by and we're blessed. You know, First Mesa's got three large large scale districts of silver uh silver districts. Um, so you know, it took us a long time to build this and to keep the purity above 50%. It's challenging. Uh, but like I said, you know, we're in the right jurisdiction. We're in Mexico. That's the number one producing jurisdiction in the globe. And, uh, you know, we, uh, we're one of the top producers in Mexico and, you know, the larger one globally as well. >> So, you brought up a lot there. So, let's look at the Mexico part. Uh about a year ago or so, if I have it correct by memory or a year and a half, there was a big jump in concern about open pit mining and mining in general in Mexico that seems to have uh calm down with Claudia Shinb as the new president. How would you rate the uh the Mexican political environment? >> Yeah, I mean it's it's definitely been quite topical the last few years. You know, under Amllo things were very challenging. uh you know first just like we're blessed obviously we're we're a producer we're not chasing any new permits we don't have any green fields projects so it didn't really impact us uh but you know we obviously pay attention to the industry and it was challenging a lot of the juniors >> um you know Shyam has uh you know come in recently and uh it's been night and day like night and day in terms of just dealing with the different uh legs of the government the you know we haven't been waiting for any critical permits but We did receive a couple of permits that we have been waiting on you know simple stuff you know [snorts] change of tailing use or whatnot but again that was a good sign and that really gave us the comfort to really invest back in Mexico you know we just you like I said closing the largest transaction in the company's history in Mexico we paid 970 million for gate silver >> and we would not have done that you know under the previous regime. >> Got it. We're going to get to the projects in a minute, but my last general introductory question is one that uh I'm very loyal to that Rick Rule taught me, which is whenever you're talking to the senior management of a precious metals company, it's important to identify what is the corporate mission statement. So, what when people buy First Majestic Silver, what do you want them to be thinking about? >> Silver, you know, that's that's our exposure. We do want to get larger. We want to be the largest silver pure silver company. Um it's obviously a tall ask. U you know there's there there are bigger ones out there but that's our mission. We do want to keep growing. Uh company's been built really on successful accretive M&As. You know we do have a large land package. So our organic growth is there and we do have a couple of pipelines in the project or in the in in the pipe. >> But uh we're always going to continue looking for silver uh silver assets. um you know where they are is is key. You know we're not going to take risk. We're not going to >> uh operate in area that we're not comfortable in. Uh so that's that's our focus. Keep growing, keep being becoming or you know adding more profit to the bottom line and that's what the that's what our shareholders love about us. >> And along those lines you closed the acquisition of Gatau Silver I believe in January of this year. >> Um so I always I have two questions about that. Number one, in the mining industry, when you buy something, you think you know what you're buying, and then you get what you get, and there's frequently a disconnect between those two. With Gats, did you get what you thought you were buying? >> I think we got more than what we thought we'd be getting. Tell us about it. >> You know, so Gats, uh, that transaction was very competitive. You know, it took about a year from initial conversation to close. Uh you can imagine, you know, there was 13 companies involved right off the bat in in a competition >> in a compet. So it was it was a competitive process run by run by the banks and you can imagine multiple rounds of bidding, multiple site visits. >> Wow, that's a that's a big number. >> Yeah. Yeah. So you can tell there was a lot of interest. >> Um you know, we're very obviously glad that we were the successful bid at the end. >> Mhm. But to give you an idea, you know, we did our analysis at $24 silver at the time and it was a creative on all, you know, we have a list of KPIs that we track, you know, from what kind of reserve it's adding, what kind of production, what kind of cash flow. It was a creative on all fronts at $24 silver. >> So, you can imagine how things are looking right now soon after closing it. Uh, so we're, you know, we're we're quite happy. Uh there was a number of M&As that happened soon after ours and uh you know we we were very happy with how ours you know what we paid what we got. Uh >> did you pay top dollar at the time or how did you win paid by paying a rich >> Yeah. I mean like >> price which turned out to be a a bargain given where we are now. >> The price is obviously one thing. Um but so the the the founding shareholder of Gatos was Tom Kaplan from the Electrum Group. Ultimately it was his decision really. He wanted to he wanted a liquidity event and First Majestic's liquidity is unmatched. You know, we trade about $200 $250 a day. You know, the whole float. We we trade the whole float every month basically. >> He took a bunch of stock obviously. >> Absolutely. >> Still owns a bunch. >> No, he's [clears throat] he's out now, but uh he's done quite well with uh he's invested. He's got a few other assets that he's putting it back in which we watch closely as well. >> But it was a it was a great uh you know, great story for him. great to have him as a shareholder and you know great that we got gats you know through him effectively >> and that's uh you know they look at uh that's one of the stuff but ultimately as well >> a single asset company doesn't matter how good the asset you have there's always a risk it's nice to put this asset in a portfolio >> and what's a better portfolio than a Mexican portfolio that's been existing for two decades >> if you look at the Mexican map u we have four assets right now >> and Gatos got slotted right in the middle of So, we're all in adjacent states, four assets in four adjacent states and just a lot more synergy that's being unlocked right now, you know, from group purchases to exploration contracts to just moving people around and that's something that a single asset company cannot have. It's unmatched. Um, so I think this the conditions of the market all that worked out being, you know, for first suggest being the ultimate wouldn't bid. >> Excellent. Well, congratulations on that. As uh Pierre Lassand always says, it's good to be lucky. Thus the name lucky Pierre. So >> Oh, there you go. >> There you go. It's good to have a little bit of luck in in in timing. >> So, uh there are three other operating minds, correct? And >> uh I guess to me the the backbone is Sand Demus. Um I I think I read that it's >> in that area has been in production for 250 years. Did I read that right? >> Absolutely. >> Mhm. Yeah. Yeah, look, we we really have three cornerstone assets right now. They're all kind of plus or minus, you know, 5 10% [snorts] from each other. >> Okay. >> Uh Sand Deas is uh shooting about 10 11 million ounces this year. >> Santalena's, you know, something in in that range as well. 9 to 10. Lasato, so Lasato at 100% produces 13 to 15 million. We have a 70% stake in that. So we'll get about 9 10 million out of that. >> Uh but Sandeas still remains to be our largest. Um and in our view it's it's under underperforming. It's doing great. It's cash flowing but we think we can do about 13 to 15 million. So you know it's about 30 to 50% improvement in the production in the next couple of years. And we see that >> and what will achieve that uh improvement is just c a lot of capital involved or >> it's exploration. Um so we've had some labor issues a couple years ago which you know did was a bit of a drag on production. That's been resolved. Um, so we're we're it's it's great to see throughput elevated again and you know production is coming up just from that stance. But we've always been targeting these tier one veins is what we refer to. So u exploration team is basically deployed a new strategy in the last little while. We put out an exploration update a couple of months ago. It shows some really exciting stuff. So we'll be following up. But our theory in the next 18 to 24 months, you know, we'll be able to target hit this tier one vein, get it into production, and you know, throughput is there, which is great. But if you combine that with higher grade, then, you know, that's just gravy. You know, it's it's your cause doesn't change really, but uh your your efficiency improve and you're getting a lot more metal for the same time that you're processing. >> And what's your balance sheet look like? >> Strongest as ever and keeps getting better and better as you can imagine. >> Mhm. you know, we have over 500 in the bank right now, 500 million [clears throat] uh in treasury. Uh, you know, very low debt, you know, net cash position. Um, and that's that's growing. You know, the end of, uh, June 30th, that's the last public information. We had 510 million. Uh, we'll be updating our we'll be providing our Q3 financials on November 5th. So, uh, you know, people will see what that looks like. Right now, >> this October, Wealthian's putting the spotlight on silver with expert interviews, deep analysis, and a special in-depth report from our partners at SCP Resource Finance. To receive this report and other exclusive benefits, you can sign up to become an accredited investor with Wealthon at wealth.com/acredited or by finding the link in the description below. Speaking of silver, Wealthon will be on the ground in Toronto for the SCP Resource Finance second global silver conference. Legendary investor Eric Sprat headlines the event alongside 15 silver mining companies presenting their top projects. Find out more in the description below. >> Um, and is Keith and the team interested in perhaps participating in M&A? I mean it's a stupid question cuz I you know if something comes along I understand but are you I assume you're open to that uh option. >> Oh sure like I mentioned 22 years and the company's been built on M&As. It's uh >> it's funny in the last >> and Keith is never satisfied. So >> in the last 10 years we seem to have done an acquisition every 3 years. >> Um we're always looking you know it's uh we have >> you know I think 18 or 19 NDAs signed in place right now. We have our eyes on, you know, a couple of interesting ones, but to us, you know, we're we're very selective in what we uh, you know, what we what we go after. Um, we're not going to go and buy a junior green field assets. >> I was just going to say at SCP resources, we focus sort of on the explorers and the developers because it is an exciting place to be when But that's not what you're looking for. >> It's the pipeline, right? So we keep an eye on but it doesn't do us any favor taking on that risk right now. We'd like to get involved at a later stage have a deer asset whether it's permitted maybe in construction development. That's really the the sweet spot for us. Um and we've done we've proven that like I said >> you know Santelena was purchased 10 years ago um in 2015 and it was producing 2 and a half maybe 3 million ounces. >> 10 years later and the mine had a 7-year life of mine 10 years ago. 10 years later, the mine has, you know, eight to nine years life of mine. Production went from two and a half to 10 million ounces. >> So quadruple production, extending life of mine. That's what First can bring to, you know, these kind of assets. Um, but yeah, we're looking, we're not stopping. It needs to be silver. And that's that's what we started off saying. It's tougher and tougher finding these assets. >> Excellent. So, uh, I'm fairly pretty familiar with Keith's sort of corporate, uh, culture about the silver price, and I think he's about as bullish as Eric Sprat, who's one of the big long-term bulls. But in terms of of what you guys look at the market, do you think it's too late to get involved in silver given its run, or do you what inning do you think we're in? >> This is a very different market right now. you know, silver broke through 30, $30. You know, this was the third time it's ever done that, right? Um, and the last couple of times it was a very quick blip. You know, it broke through 30 and right straight to 50. This time is a little bit different. You know, it kind of hovered. It took it a while to break through 30. Once it did 30, it sat there for a little while, consolidated, then 35 became the new resistance again. >> 40 quick, >> 40 quick, but it, you know, 30 comfortable, 35 comfortable, hovered around 40 for a while as well. So, uh, you know, I think this is really just the start of this, uh, this cycle. You know, we're going to be it's going to be around for, you know, few more years. And, uh, >> you listen as well to what we're, you know, what Eric said this morning. We're mining 7 to1. You know, for every 1 oz of gold, we're only mining 7 ounces of silver. >> Yet the price ratio is sitting at 84:1. Okay. It's improved from 100. It was 100 to1. Now, it's come down to 84. >> Mhm. >> That's still, you know, nowhere near the mining ratio. Mhm. >> So if you bring that down, not even to historic, but take it to 40 to1. >> That's $100 silver right there, just holding gold the way it is. So you hear Keith and others now are are saying tripledigit silver. >> That's where that rational comes from. >> Eric also touched, you know, initially or you know back in the day the ratio this the price ratio was 12 or 15 to1. Well then you can only imagine what silver would be if nothing happens in gold, right? Like if all the geopolitical issues have been resolved and gold is not going to go up anymore, which no one's really believing. But if you hold gold the way it is right now, silver is, you know, has a lot more to go. >> Rick uh rule has, you know, this pretty ar pretty difficult to argue with theory that the US dollar is due over some period of time 75% depreciation. you know, if you want a bench clearing number and that implies gold should be a three to one and silver should sort of be double that, you know, so six to one is sort of out there uh if all of these macro factors uh continue to develop as as quickly as they have. Um are you surprised silver's done this well? >> Uh I don't not that it's done this well. I think it just took it a while a long time to catch up, you know, and we're still we just hit >> all-time high just now. >> You know, gold is double its all-time high, >> you know, that they both hit in 2011, right? >> You know, so uh we I think everyone understands that theory that silver, you know, takes but it's it's more like a slingshot, you know, it takes a while for it to really catch up, but once it catches up to gold, it'll outperform. And I think we're starting to enter that that phase right now. So yeah, >> I have sort of a funny footnote question that I've always wondered. You know, we read a lot about the industrial demand and how solid photovoltaic blah blah blah AI, you know, the industrial demand 59 four years of deficit. When it gets like this, when you guys sell your silver, do you notice like do industrial buyers start sort of bidding you up or not really? it just goes into the market and >> yeah, we don't have the visibility on the spot component of the silver. What we've done differently and we're the only mining company that does that has that now we build our own mint. >> So now we're minting we're minting our own silver. Now this is the same silver that's coming from >> talk about it. >> Las Vegas. So it's in Las Vegas. It's, you know, it's it's a great jurisdiction. You know, you got the airport right there. International uh distribution and domestic and very secure, very safe area. >> So how does that work? You ship yourself the >> door or >> correct? So we we it still gets refined by a third party refinery in uh in Salt Lake City and then basically gets transport transported to to Vegas where you know we grain it and then turn it into different kind of products >> and uh you know we firstic has been doing that for a while uh but we've always used third party mints but what we realized in the last couple of years is you know demand is far exceeding supply. we've not been a the third party mints weren't able to supply the products. So we said screw this, you know, just go on full vertical integration, build our own minting facility. Very tough, very secretive. So there's not much. So we had to learn all that. But we're blessed to have, you know, have had that vision. Keith has had that vision and we've executed executed on it. So >> we comm commissioned it last year. >> And the timing right now could not have been better. The >> So that gives you the flexibility to sell to a wider group of those that are normally bidding in the spot market. >> Pretty much. Yeah. private sales to billion dollar family offices that have is that amount >> that's pretty much it. Yeah. So we right now we got 7% of our production going through this facility and we're targeting [clears throat] 10%. >> Just the last you know this whole frenzy that's going on you know a lot of retail guys are buying and you know we're in conversation with some big players that want to buy big chunks and just just hoard it just sit on it. So, uh, I think that's going to be a pretty interesting avenue coming through. And, uh, we we've seen the sales, you know, going through record times once when silver hit 50. You know, you'd expect people are buying when it's lower, but I think this FOMO, uh, feeling right now, >> especially with silver, >> that's the thing. >> Very emotional. >> Yeah. And it's uh, it's great and people are, you know, whoever is buying, they're still making money and our premium are still pretty reasonable. So my last naive question about the mint, is there a profit boost there or is it just control of your markets that you're after? >> No, it's >> there's a margin there. >> Definitely. Yeah. Yeah. So, you know, with that we're able to charge, you know, anywhere from three to five to six bucks. Sometimes we'll do special runs where we'll charge >> We're talking over spot. >> Overspot, correct? Yeah. So, whatever spot is, you know, we're always going to tack on that that premium, >> you know, competitive premium, we're able to do that and we're still making money. That's still our silver. It's costing us $178 anyways to make. Instead of selling it for 50 bucks, we're selling it for $55 now. >> So, what's the payback on the investment >> already done? >> Yeah, >> that's a good idea. >> Yeah. Yeah, it's great. And uh, you know, we're again, like I said, lucky to have, you know, we we uh we have the right operators in place as well right now. So, scaling it up and just really meeting this demand has been pretty u pretty exciting and uh, you know, nice to see. >> Terrific. Well, uh, thank you very much, Manny, for taking the time to visit with us. Sounds like a very exciting story. Uh we'll keep our eyes on you and look forward to catching up in a few months. >> Absolutely. Thanks, D. >> Terrific. Thanks for coming. >> Yeah. >> Don't forget to sign up for a free portfolio review with one of our endorsed investment partners at wealthon.comfree. With markets hitting all-time highs, now is a great time to stress test your strategy and be prepared for what comes next. Thank you all for watching. We'll see you again next time. >> [music]