First Majestic Silver Corp. (NYSE: AG) reported second-quarter 2013 earnings before markets opened this morning. The Canada-based silver miner posted adjusted earnings per share (EPS) of $0.07 on revenues of $48.4 million. In the same period a year ago, the company reported EPS of $0.14 on revenues of $54.8 million. Second-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.10 and $47.12 million in revenues.

Last week, silver miners Coeur Mining Co. (NYSE: CDE) and Hecla Mining Corp. (NYSE: HL) both posted poor earnings results for the second quarter, and even though First Majestic beat the consensus EPS estimate, it was not a good quarter for it either.

In the second quarter alone, shares of First Majestic tumbled nearly a third, while Coeur’s shares fell about 28% and Hecla’s shares were off about 23%.

First Majestic produced about 2.7 million ounces of payable silver in the second quarter, a 42% increase year-over-year. But the realized price dropped so far (down 23%) that the company stopped selling its production, which drove up its cost per ounce by 7%. Silver prices fell 25% at Coeur, and Hecla’s realized price was down about 40%.

The miners are responding to the low silver prices by cutting costs, and in Hecla’s case, hedging all of its metals production. We have not seen much hedging in the precious metals sector for several years, but falling prices make hedging at least a portion of production a reasonable option again.

First Majestic said nothing about a new hedging program, and the company’s CEO said that he is “confident the silver price will revert back to the mean in the near future.” The company will continue to cut costs and improve operations he said.

Shares of First Majestic are up about 0.6% in premarket trading this morning, at $13.38 in a 52-week range of $8.81 to $24.20. Thomson Reuters had a consensus analyst price target of around $17.25 before today’s report.

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