Silver Wheaton's (NYSE:SLW) Record Earnings Still Miss Expectations

Silver Wheaton Corp. (NYSE:SLW) (TSE:SLW) had record earnings for the second quarter, but it wasn't enough to meet analysts' expectations.

Earnings were led by an increase in production and higher silver prices, which generated $53.3 million, or 15 cents a share. That was in contrast to last year in the same quarter where they earning $18.4 million, or 7 cents a share.

Analysts had been looking for earnings of 16 cents a share for the quarter.

Revenue more than doubled from $41.4 million last year in the same period to $95.0 million this year. Analysts had expected $94.28 million in revenue.

Silver Wheaton chief executive officer Peter Barnes, said, "In the face of continued global economic uncertainty, the price of silver performed very well in the quarter, leading to record cash operating margins of US$14.45 per ounce, and clearly demonstrating the advantages of Silver Wheaton's business model of low fixed operating costs."

Concerning guidance, Barnes reiterated, "With Goldcorp's Penasquito mine in Mexico, the first of our cornerstone assets, continuing to ramp up silver production ahead of schedule, we look forward to an even stronger second half to the year and maintain our annual attributable silver equivalent production guidance of 23.5 million ounces."

Silver Wheaton closed in New York at $19.20, losing $0.67, or 3.37 percent.

Silver Wheaton Increases Profit 2 Percent for Quarter

Silver Wheaton CEO Peter Barnes

While Silver Wheaton (SLW.TO) experienced lowers sales volume than anticipated for the quarter, the higher price of metal allowed it to enjoy a 2 percent increase in profit for the second quarter.

The Canadian-based company ended with earnings of $23.3 million, in contrast to $22.9 million a year ago for the quarter ending June 30.

The company average a selling price of $17.35 an ounce for its silver sales, on the 2.9 million ounces it sold. The 2.9 million ounces sold was down by 13 percent from its projections. Last year they sold 3.1 million ounces during the same period.

According to Wheaton, the reason was the quality of the ore mined at Goldcorp's (G.TO) Luismin mine in Mexico, which was lower-grade ore.

CEO Peter Barnes noted in a press release that "This past quarter, we negotiated more silver stream agreements than any other quarter in our history.

"With eight silver agreements completed and another soon to be, we have diversified our portfolio and expanded our relationships within the industry."

Projections are for annual sales to reach somewhere between 13- to 15 million ounces sold in 2008.