Endeavour weathers first half blues to hit record production

Despite a shaky first half of the year Endeavour Silver (EDR-T, EXK-X) rebounded to reach record production from its two Mexican mines by year end.

Endeavour owns and operates both the Guanacevi and the Bolanitos mines in Mexico, which turned out 636,866 oz of silver in the fourth quarter a 10% increase compared with the third quarter and massive 72% increase compared to the 369,295 oz produced during the same period in the year previous.

In total, the company managed to turn out 2.14 million oz. of silver in 2007, beating its revised production forecast of 2 million oz for the year. The annual total was better than 2006’s total of 1.35 million oz. 58%.

Those numbers, however, do fall short of guidance issued at the beginning of the year. Back then the company set a target of 2.8 million oz. of silver production.

By the end of the second quarter it was clear that its operations weren’t up to snuff, so the company initiated an operational review.

Endeavour blamed delays in mine and plant capital projects at both mines for pushing back earlier production and cash cost targets.

With those delays now in its past, the company also managed to ramp up its gold production. It produced 2,100 oz of the yellow metal in the quarter and 6,427 oz. for the year — a 158% jump compared to the 2,493 oz. produced in 2006.

The company says a more detailed review of operations and a production forecast for 2008 will be released by the end of January.

Even with the record production levels, Endeavour is looking to out-do itself in the coming year. It says plant improvements at Guanacevi and mine development and exploration at Bolanitos could double production over the next two years.

In Toronto on Jan. 15, Endeavour’s shares fell close to 4% or 15 to $3.90 on roughly 145,000 shares traded. Its shares have traded between $6.09 and $3.15 over the last 52-weeks and it has roughly 49 million shares outstanding.