08/14/2013 07:18 EDT | Updated 10/14/2013 05:12 EDT

Silver Wheaton Q2 profit plunges 50% amid falling revenue; dividend reduced

VANCOUVER - Silver Wheaton Corp. (TSX:SLW) announced a reduction in its dividend Wednesday after reporting a sharp drop in profits and revenue despite record attributable silver production in the second quarter.

The Vancouver-based company, which keeps its books in U.S. dollars and pays a dividend equal to 20 per cent of the average cash generated by operating activities over the previous four quarters, said its next quarterly payout would fall to 10 cents US from 12 cents.

It will be paid on or about Sept. 2 to shareholders of record at the close of business Aug 30.

Silver Wheaton reported after markets closed that profits in the three months ended June 30 fell to US$71.1 million, or 20 cents per share, half of the US$141.4 million or 20 cents per share it earned in the same year-earlier period.

Sales revenue fell to US$166.9 million from US$201.4 million even as it reported record attributable silver equivalent production of 8.6 million ounces (6.4 million ounces of silver and 35,600 ounces of gold). That was up 28 per cent from 6.7 million ounces in the prior-year period.

The 17 per cent drop in revenue was due primarily to a 21 per cent decrease in the average realized silver equivalent price of US$23.05 per ounce in the most recent period from $29.07 in Q2 2012, partially offset by a four per cent increase in the number of silver equivalent ounces sold.

On the Toronto Stock Exchange, Silver Wheaton shares closed up 88 cents, or 3.52 per cent, at $25.89 on Wednesday.