Silver Standard in red despite best year

Vancouver — Expensing of stock options put Silver Standard Resources (SSO-T) into the red last year by $1.5 million (or 3 a share), though that’s still an improvement over 2003, when the company reported a loss of $3.9 million (10 a share).

With no revenues from operations, the company reported gains from the selling of shares in other companies and investment income, which provided earnings of nearly $1 million in cash.

Between 2003 and 2004, Silver Standard increased its treasury from $16.9 million to $61.6 million; it now holds $45.7 million in cash and the rest in silver bullion.

In 2004, Silver Standard bought the remaining 56.6% interest in the Pirquitas silver-tin-zinc property in northern Argentina; it now owns the property outright. The company plans to update the 2000 feasibility work on the project this year by doing metallurgical tests. Pirquitas is expected to produce 11 million oz. silver per year over a mine life of eight years.

The property contains 5.3 million tonnes of measured resources grading 158 grams silver per tonne and 28.7 million tonnes of indicated resources grading 137 grams silver, as well as zinc and tin credits. The total amount of contained silver is 183 million oz.

Pirquitas is benefiting from the devaluation of the Argentine peso against the U.S. dollar, and a new pipeline has been constructed, which should help lower power costs.

Meanwhile, the company has expanded the Pitarrilla silver deposit in Mexico, where drilling is under way. Indicated resources are estimated at 16.5 million tonnes grading 113.5 grams silver, or 60.2 million oz. silver; inferred resources, at 4.8 million tonnes of 85.1 grams silver, or 13.1 million oz.

At its half-owned Manantial Espejo silver-gold property in Argentina, the company conducted feasibility work and, later this year, will announce a production decision.

Farther afield, the Bowdens project in Australia is looking less attractive in light of the high U.S. dollar and higher costs for labour and steel construction.

Silver Standard started trading on the Toronto Stock Exchange in November 2004 after trading on the west coast for 47 years. More recently, it began trading on the Nasdaq in the U.S.