Highlights

• Quarterly Dividend of 1.42 cents per share (U.S. currency), payable on or about November 30, 2026 to holders of record on November 16

• Third-quarter Revenue of $394.1 million (U.S. currency), up 38%, with net Earnings attributable to owners of $74.5 million

• Treasury of $1.23 billion and record Working Capital of $882.3 million, while San Dimas operations remain suspended since September 18

First Majestic Silver Corp. (TSX:AG) issued its third quarter financial results last Thursday and declared a quarterly dividend of about one and a half cents per share in United States dollars, a payment that is almost three times the amount distributed a year earlier. The Vancouver-based silver and gold producer reported sharply higher revenue and earnings on stronger metal prices, but also disclosed that its San Dimas mine in Mexico has been suspended by a labour dispute since mid-September.

A Dividend That Follows Revenue

Unlike many Canadian dividend payers that set a fixed per-share amount and adjust it occasionally, First Majestic ties its payout to sales. Since the start of this year, the board has targeted roughly two percent of net quarterly revenue, divided by the number of shares outstanding, with revenue from the Los Gatos mine counted at seventy percent to match the company's ownership stake. The latest declaration is payable on or about the last day of November to shareholders of record in mid-month, and the company designated it as an eligible dividend for Canadian tax purposes. Non-resident holders may face Canadian Withholding tax.

The structure matters because it makes the cash returned to shareholders rise and fall with metal prices. When silver and gold are firm, the dividend expands without a board vote on a new rate; when prices soften, it shrinks just as automatically. For those following Dividend Stocks, a revenue-linked formula is a distinct model from the steady quarterly or monthly payouts offered by utilities, pipelines and real estate trusts.

Revenue, Earnings and Cash Generation

Quarterly revenue reached roughly three hundred ninety-four million United States dollars, up more than a third from the same period last year. Mine operating earnings rose by nearly three quarters, and adjusted EBITDA climbed by about two thirds. Net earnings attributable to owners came in at about seventy-four million dollars, more than double last year's quarter, equal to fifteen cents per share on a basic and diluted basis.

The driver was price rather than volume. Average realised silver prices were near sixty-two dollars per ounce, well above the roughly thirty-nine dollars a year earlier, and realised gold was around four thousand two hundred dollars per ounce. Silver accounted for the largest share of revenue, with gold second. Meanwhile, silver production fell about eleven percent and gold production fell about seventeen percent on an attributable basis, a reminder that a strong price backdrop was masking softer physical output.

Free Cash Flow was lower than a year earlier despite the earnings gain. Cash income taxes and settlements absorbed a large amount in the quarter, including payments tied to two reassessments linked to legacy forward silver purchase agreements. A one-time settlement expense with the Mexican tax authority also reduced reported results. Investment income, by contrast, swung to a gain from a loss a year earlier.

Balance Sheet Strength

The Balance Sheet is the main support for the payout. Treasury, which combines cash and restricted cash, stood at roughly one point two billion dollars, about a third higher than at the end of last year. Working capital reached a company record of roughly eight hundred eighty million dollars, and total Liquidity including undrawn Credit lines exceeded one billion dollars. The company also renewed its share repurchase program in mid-October, having repurchased a modest number of shares in the quarter.

Capital spending roughly doubled from last year, reflecting underground development, exploration and the restart of the Jerritt Canyon gold operation in Nevada. Year-to-date spending sits at under two thirds of the midpoint of full-year guidance. Higher capital intensity is a trade-off for shareholders, since money invested in growth is not available for distribution.

Operations and the San Dimas Suspension

First Majestic operates four producing underground mines in Mexico: Santa Elena, Los Gatos, San Dimas and La Encantada. Together the four mines processed about one million tonnes of ore in the quarter, an increase of nearly one tenth. Los Gatos was the largest silver contributor, followed by San Dimas and La Encantada. Cash costs and all-in sustaining costs per silver-equivalent ounce rose by roughly half against last year, partly because the conversion ratio between gold and silver moved and partly because of the lost production days.

San Dimas is the key operational risk. The mine has been temporarily suspended since the middle of September, which cost twelve days of production in the quarter. The dispute concerns income tax on an annual production bonus: the union has asked the company to pay all of the tax, and the company has declined, citing Mexican law. A strike was called in early October and the company has challenged its legality, with a ruling expected in the second half of November. Annual production and cost guidance for San Dimas has been withdrawn until visibility on a restart improves.

Chief executive Keith Neumeyer said the company remains financially strong, with its three producing operations running at or above budget. Year-to-date silver and gold output stands at roughly three quarters of the revised full-year guidance midpoints, and all-in sustaining costs for the period remain within the revised range.

Sector and Macro Context

All amounts in the company's release are stated in United States dollars unless noted otherwise, which is standard for a producer whose metals are priced in that currency.

Precious metals producers have benefited from historically high prices this year, supported by Demand for safe-haven Assets and expectations about monetary policy. Canadian-listed miners with Mexican operations also carry currency exposure, since costs are largely in pesos while revenue is in United States dollars, and they face evolving tax and labour conditions in that jurisdiction. For Canadian investors, the dividend is paid in United States dollars, so the Canadian-dollar value depends on the exchange rate, and the Bank of Canada's rate path can influence that currency pair.

Risks and What to Watch

The principal risks are a Reversal in silver and gold prices, a prolonged San Dimas stoppage, further tax reassessments in Mexico, and cost inflation. Because the dividend is formula-driven, any decline in revenue would reduce the payout directly. On the positive side, the large treasury balance and record working capital give the company flexibility to ride out a temporary production gap.

Near-term markers include the court or labour board ruling on the strike, the Record Date in mid-November, the payment date at month end, and any updated guidance once San Dimas visibility improves. The company is also working to restart Jerritt Canyon, which could diversify production beyond Mexico over time. The shares trade on the Toronto Stock Exchange and are a constituent of the [S&P/TSX Composite Index], where precious metals producers form a notable part of the materials sector.