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EX-10.1 - CREDIT AGREEMENT - Coeur Mining, Inc. | d392162dex101.htm |
8-K - FORM 8-K - Coeur Mining, Inc. | d392162d8k.htm |
Exhibit 99.1
Coeur Reports Strong Second Quarter Financial and Operating Results;
Provides Positive Update to 2012 Guidance
COEUR DALENE, Idaho - August 7, 2012 - Coeur dAlene Mines Corporation (NYSE:CDE, TSX:CDM) produced 4.9 million ounces of silver and 63,047 ounces of gold during the second quarter, which resulted in $254.4 million in sales, $88.4 million in operating cash flow,1 and a $47.1 million increase in cash, cash equivalents and short-term investments to $200.3 million.
The Company expects to achieve the high-end of its 2012 silver and gold production guidance of 18.5 - 20.0 million silver ounces and 210,000 - 230,000 gold ounces. The Company also expects to achieve the low-end of its 2012 guidance for cash operating costs1 per silver ounce of $6.50 - $7.50.
Second Quarter Highlights
| Silver production totaled 4.9 million ounces, equal to first quarter 2012 levels. |
| Gold production totaled 63,047 ounces, up 44% from the first quarter. |
| Net metal sales totaled $254.4 million, up 24% from the first quarter. |
| Operating cash flow1 totaled $88.4 million, down 6% from the first quarter. Including changes in working capital, net cash from operating activities totaled $113.2 million compared to $17.0 million in the first quarter. |
| Consolidated cash operating costs1 totaled $6.41 per silver ounce, up slightly from the first quarter. |
| Cash operating costs1 per gold ounce declined 50% from the first quarter to $1,348 and are expected to reach $900 by year-end. |
| Adjusted earnings1 totaled $28.0 million, or $0.31 per share, compared to $41.5 million, or $0.46 per share, in the first quarter. Net income totaled $23.0 million, or $0.26 per share, compared to $4.0 million, or $0.04 per share, in the first quarter. |
| Announced a share repurchase program of up to $100 million of the Companys common stock and finalized a $100 million, four-year revolving credit facility. |
| Cash, cash equivalents and short-term investments totaled $200.3 million as of June 30, 2012, $47.1 million higher than March 31, 2012. |
The Company is performing according to plan, which is leading to strong financial performance, said Mitchell J. Krebs, Coeurs President and Chief Executive Officer. The Board of Directors authorization in June to repurchase up to $100 million of the Companys common stock reflects our confidence in the Companys underlying cash flow and the long-term value the Company represents for shareholders, he said.
Our Kensington gold mine in Alaska nearly tripled its production and cut its operating costs per ounce in half during the second quarter with the mines return to full production, which represent key milestones for this important operation. We also saw higher silver and gold production levels and substantially lower costs at our Rochester mine in Nevada as a result of an expansion that took place in 2011. Our Palmarejo silver and gold mine in Mexico and our San Bartolomé silver mine in Bolivia both delivered consistent results during the second quarter. Despite industry-wide cost pressures, the Company delivered flat cash operating costs1 per ounce during the second quarter, due mostly to efficiency improvements achieved at its key operations, Krebs said.
1. | EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations. |
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Table 1: Financial Highlights (Unaudited)
US$ and silver ounces sold in millions (except per share amounts, average realized prices, and gold ounces sold) |
2Q 2012 |
2Q 2011 |
Quarter Variance |
YTD 2012 |
YTD 2011 |
YTD Variance |
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Sales of Metal |
$ | 254.4 | $ | 231.1 | 10 | % | $ | 459.0 | $ | 430.7 | 7 | % | ||||||||||||
Production Costs |
131.8 | 77.1 | 71 | % | 224.4 | 169.6 | 32 | % | ||||||||||||||||
EBITDA (1) |
102.6 | 137.0 | (25 | %) | 199.4 | 225.6 | (12 | %) | ||||||||||||||||
Adjusted Earnings (1) |
28.0 | 58.0 | (52 | %) | 69.4 | 95.6 | (27 | %) | ||||||||||||||||
Adjusted Earnings Per Share(1) |
$ | 0.31 | $ | 0.65 | (52 | %) | $ | 0.77 | $ | 1.07 | (28 | %) | ||||||||||||
Net Income |
23.0 | 38.6 | (40 | %) | 26.9 | 51.1 | (47 | %) | ||||||||||||||||
Earning Per Share |
$ | 0.26 | $ | 0.43 | (40 | %) | $ | 0.30 | $ | 0.57 | (47 | %) | ||||||||||||
Operating Cash Flow (1) |
88.4 | 115.8 | (24 | %) | 182.2 | 206.0 | (12 | %) | ||||||||||||||||
Capital Expenditures |
32.2 | 25.8 | 25 | % | 63.9 | 41.7 | 53 | % | ||||||||||||||||
Cash, Cash Equivalents, and Short Term Investments |
200.3 | 107.3 | 87 | % | 200.3 | 107.3 | 87 | % | ||||||||||||||||
Total Debt(1) |
118.8 | 157.1 | (24 | %) | 118.8 | 157.1 | (24 | %) | ||||||||||||||||
Weighted Average Shares Issued & Outstanding |
89.6 | 89.3 | | % | 89.6 | 89.3 | | % | ||||||||||||||||
Average Realized Price Per Ounce - Silver |
$ | 29.28 | $ | 39.11 | (25 | %) | $ | 30.72 | $ | 35.42 | (13 | %) | ||||||||||||
Average Realized Price Per Ounce - Gold |
$ | 1,610 | $ | 1,504 | 7 | % | $ | 1,646 | $ | 1,430 | 15 | % | ||||||||||||
Silver Ounces Sold |
5.6 | 4.1 | 37 | % | 9.9 | 7.8 | 27 | % | ||||||||||||||||
Gold Ounces Sold |
59,579 | 49,930 | 19 | % | 98,464 | 115,852 | (15 | %) |
Net metal sales for the second quarter totaled $254.4 million, higher than both the second quarter of 2011 and the first quarter of 2012. This increase is due primarily to increased silver ounces sold year-over-year and higher gold production at Kensington and Rochester. Average realized prices per ounce of silver and gold were $29.28 and $1,610, respectively, in the second quarter, which were 25% lower and 7% higher, respectively, than the second quarter of 2011. Silver contributed 63.2% of the Companys total metal sales in the second quarter compared to 68.7% a year ago.
Prior to changes in working capital, Coeur generated $88.4 million in operating cash flow1 in the second quarter of 2012 compared to $115.8 million a year ago. After working capital changes, the Company generated net cash from operating activities of $113.2 million in the second quarter of 2012 compared to $111.1 million in the second quarter of 2011.
Consolidated cash operating costs1 totaled $6.35 per silver ounce for the first half of 2012 compared to $5.69 per silver ounce for the first half of 2011. These higher unit cash operating costs1 are due primarily increased costs of consumables at San Bartolomé in 2012, higher maintenance costs at Palmarejo, and higher costs at Rochester in 2012 due to the resumption of active mining late in 2011.
Coeur reports a non-U.S. GAAP metric of adjusted earnings1 as a measure of operating income, which excludes non-cash fair value adjustments, other non-cash adjustments, deferred taxes and discontinued operations. Second quarter 2012 adjusted earnings1 were $28.0 million, or $0.31 per share. On a U.S. GAAP basis, the Company realized net income of $23.0 million, or $0.26 per share, in the second quarter compared with net income of $38.6 million, or $0.43 per share, in the second quarter of 2011. The earnings reflect non-cash fair value adjustments that increased net income by $16.0 million and decreased net income by $12.4 million in the three months ended June 30, 2012 and 2011, respectively. These fair value adjustments are driven primarily by changing gold prices which impact the estimated future liabilities related to the Palmarejo gold production royalty obligation.
On June 7, 2012, Coeur announced a share repurchase program of up to $100 million of the Companys common stock. Since the end of the quarter, the Company has finalized a $100 million, four-year revolving credit facility and has provided notice to repay from existing cash the remaining outstanding $68.0 million balance of the Kensington term loan facility.
1. | EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations. |
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Table 2: Operational Highlights: Production
(silver ounces in thousands) | 2Q 2012 | 2Q 2011 | Quarter Variance | YTD 2012 | YTD 2011 | YTD Variance | ||||||||||||||||||||||||||||||||||||||||||
Silver | Gold | Silver | Gold | Silver | Gold | Silver | Gold | Silver | Gold | Silver | Gold | |||||||||||||||||||||||||||||||||||||
Palmarejo |
2,366 | 31,258 | 2,370 | 33,389 | | % | (6 | %) | 4,848 | 62,338 | 4,100 | 61,148 | 18 | % | 2 | % | ||||||||||||||||||||||||||||||||
San Bartolomé |
1,470 | | 1,742 | | (16 | %) | n.a. | 3,062 | | 3,453 | | (11 | %) | n.a. | ||||||||||||||||||||||||||||||||||
Rochester |
713 | 10,120 | 333 | 1,397 | 114 | % | 624 | % | 1,154 | 15,412 | 677 | 2,848 | 70 | % | 441 | % | ||||||||||||||||||||||||||||||||
Martha |
108 | 97 | 101 | 112 | 7 | % | (13 | %) | 231 | 181 | 281 | 356 | (18 | %) | (49 | %) | ||||||||||||||||||||||||||||||||
Kensington |
| 21,572 | | 25,758 | n.a. | (16 | %) | | 29,016 | | 49,434 | n.a. | (41 | %) | ||||||||||||||||||||||||||||||||||
Endeavor |
240 | | 215 | | 12 | % | n.a. | 488 | | 364 | | 34 | % | n.a. | ||||||||||||||||||||||||||||||||||
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Total |
4,897 | 63,047 | 4,761 | 60,656 | 3 | % | 4 | % | 9,783 | 106,947 | 8,875 | 113,786 | 10 | % | (6 | %) |
Additional operating statistics are in the tables in the Appendix.
Table 3: Operational Highlights: Cash Operating Costs Per Ounce 1
2Q 2012 | 2Q 2011 | Quarter Variance |
YTD 2012 | YTD 2011 | YTD Variance |
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Palmarejo |
$ | (0.85 | ) | $ | (3.68 | ) | 77 | % | $ | (1.58 | ) | $ | (0.10 | ) | 1,480 | % | ||||||||
San Bartolomé |
11.05 | 8.73 | 27 | % | 10.62 | 8.93 | 19 | % | ||||||||||||||||
Rochester |
9.83 | 4.34 | 126 | % | 15.00 | 7.31 | 105 | % | ||||||||||||||||
Martha |
55.07 | 38.79 | 42 | % | 50.50 | 29.60 | 71 | % | ||||||||||||||||
Endeavor |
17.50 | 20.04 | (13 | %) | 17.07 | 18.85 | (9 | %) | ||||||||||||||||
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Total |
$ | 6.41 | $ | 3.39 | 89 | % | $ | 6.35 | $ | 5.69 | 12 | % | ||||||||||||
Kensington |
$ | 1,348 | $ | 924 | 46 | % | $ | 1,697 | $ | 955 | 78 | % |
Additional operating statistics are in the tables in the Appendix.
Palmarejo, Mexico - Strong Cash Flow
| Second quarter production totaled 2.4 million ounces of silver and 31,258 ounces of gold, which was consistent with first quarter of 2012 and second quarter 2011 production. |
| Cash operating costs1 per silver ounce in the second quarter were $(0.85) compared to ($2.27) in the first quarter. Higher costs in the second quarter compared to first quarter 2012 and second quarter 2011 were primarily due to higher maintenance costs and to downtime related to a temporary work stoppage at the mine in May. |
| Sales and operating cash flow1 totaled $136.4 million and $63.6 million, respectively, in the second quarter. Capital expenditures were $11.2 million. |
San Bartolomé, Bolivia - Consistent Performance
| Silver production totaled 1.5 million ounces in the second quarter; consistent with first quarter production. |
| Cash operating costs1 per silver ounce were $11.05 compared to $10.21 in the first quarter. Lower ore grade impacted cash operating costs1 per ounce. |
| Sales and operating cash flow1 totaled $53.4 million and $24.8 million, respectively, in the second quarter. Capital expenditures were $7.8 million. |
1. | EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations. |
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Kensington, Alaska - Production Accelerating as Costs Drop
| Second quarter production returned to full-scale, almost tripling over the first quarter to 21,572 ounces of gold. |
| Cash operating costs1 per gold ounce declined 50% from the first quarter to $1,348 and are expected to reach $900 by year-end. |
| Sustainable production levels are now being achieved and all major improvement projects have been completed. |
| Sales and operating cash flow1 totaled $21.1 million and $0.6 million, respectively, in the second quarter. Capital expenditures were $9.3 million. |
Rochester, Nevada - Rising Production Levels and Lower Costs
| Second quarter silver production increased over the first quarter by 62% to 712,706 ounces and gold production increased 91% to 10,120 ounces. |
| Cash operating costs1 in the second quarter declined 58% to $9.83 per silver ounce compared to the first quarter. |
| Sales and operating cash flow1 totaled $34.2 million and $11.8 million, respectively, in the second quarter. Capital expenditures were $2.9 million. |
The Martha mine in the Santa Cruz province of Argentina has continued to experience high operating costs and low production due to a short remaining expected mine life after ten years of production since 2002. The Company expects to cease active mining operations by September 30, 2012, and to commence reclamation activities after mining operations have concluded. Employees affected by the cessation of mining operations are expected to be placed with other mining companies in the region. As previously disclosed, the Company is evaluating strategic and operational alternatives for the Martha mine. As a result, the Company recorded an impairment charge of $4.8 million in the second quarter.
Exploration Highlights
During the second quarter, the Company completed 60,292 meters (197,808 feet) of drilling and trenching in its exploration programs at Palmarejo, Rochester, projects in Argentina, Kensington, San Bartolomé, and the Carrizalillo prospect in Chile. Up to 17 drills were employed by the Company during the second quarter. Coeurs exploration teams received three awards from the International Society of Mine Safety Professionals in recognition of their commitment to safety.
Donald J. Birak, Senior Vice President of Exploration for Coeur, commented, On the exploration front, we are enthusiastic about the results from drilling at Palmarejo. The Guadalupe deposit, which is expected to be in production next year, continues to expand and remains open at depth and to the northwest. A new target called La Blanca Norte was defined during the second quarter near the existing Palmarejo operation and it is planned to be aggressively drilled during the remainder of 2012. In addition, we are pleased to announce completion of an upgraded mineral resource estimate for the Joaquin silver-gold project in southern Argentina. We are especially pleased with the safety awards received by our teams in Mexico, Argentina and Chile, Birak said.
Palmarejo
The Company completed 32,321 meters (106,040 feet) of exploration core drilling in the Palmarejo district. This drilling was divided between targets around the current Palmarejo mine and at the Guadalupe area located approximately six kilometers from the Palmarejo mine. Mineralization at Guadalupe has now been defined over a length of more than 2.5 kilometers (+8,200 feet) from southeast to northwest and remains open to the northwest and at depth. Since the last mineral resource and reserve estimate for Guadalupe was prepared, 100 new core holes have been completed and will be used to prepare a new model of mineral resources and reserves at year-end. Surface drilling commenced on the new La Blanca Norte zone situated immediately northwest of the Palmarejo mill complex. A helicopter-borne geophysical (magnetics) survey was completed over the Companys entire land holding, which is helping to identify new drill targets.
1. | EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations. |
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Kensington
Exploration at Kensington consisted of 4,534 meters (14,875 feet) of core drilling. Nearly all of the drilling was devoted to infill drilling of the Raven zone, which is located approximately 670 meters (2,200 feet) due west of the Kensington ore body. In addition, drilling recommenced on the new Kensington South target where drilling encountered veining and alteration similar to that of the main Kensington mine with encouraging gold grades. A helicopter-borne geophysical (magnetics) survey was conducted to help identify future drill targets.
In addition, the Company completed 3,976 meters (13,045 feet) of definition core drilling at Zone 10, which is expected to constitute a major part of the mine plan for the next three years. Assay results from 85 new holes from independent laboratories showed multiple gold-mineralized intervals, ranging from one foot to 34-feet true widths and gold grades from a cutoff grade of 0.1 to over 6.0 ounces per ton. The Company plans to use this data to update the mineral resources and reserves of Zone 10.
Rochester
Drilling at Rochester totaled 14,548 meters (47,730 feet) in 252 holes on the property. Over 80% of this drilling focused on existing Rochester stockpile inventory with the remainder at Northwest Rochester.
San Bartolomé
One hundred new backhoe trenches were completed and sampled at San Bartolomé. In the third quarter, trenching and sampling are planned to shift to new targets due west of the current mining area.
Carrizalillo
An initial program of 3 core holes, totaling 1,328 meters (4,357 feet), was completed at this prospect in north-central Chile. Three prominent zones of hydrothermal alteration with anomalous precious metals detected from past sampling were tested. Results are pending.
Joaquin
A total of 3,450 meters (11,319 feet) of drilling was completed at the Joaquin joint venture property, located approximately 70 kilometers (43 miles) north of the Companys Martha mine, to complete infill drilling at the La Negra and La Morocha deposits and test new targets on the property. Data from this drilling, and drilling completed in the second half of 2011, were used to update the 2011 resource estimates at La Negra and La Morocha.
As a result, the August 2012 mineral estimate for Joaquin (shown in table 4 below) reflects a 102% increase in contained silver ounces and an 18% increase in contained gold ounces in measured and indicated resources compared to the May 2011 mineral estimate. The estimated silver and gold ounces contained in inferred resources were reduced from May 2011 levels as material was upgraded from the inferred category to measured and indicated categories. The August 2012 resource estimate used metal prices of $30 per silver ounce and $1,500 per gold ounce compared with $20 per silver ounce and $1,300 per gold ounce in May 2011.
The new mineral resource estimate incorporates results from 123 new core drill holes (16,707 meters) designed to upgrade inferred mineral resources in the May 2011 estimate to measured and indicated levels. In addition to the new drilling, results from 43 drill holes (6,231 meters) were received after the model was completed and are expected to be incorporated into the next update in early 2013.
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Table 4: Joaquin Project Mineral Resources (100% Basis)
Average Grade (grams/tonne) | Contained Ounces | |||||||||||||||||||||
August 20121,2,3,4 |
Classification | Tonnes (000s) | Gold | Silver | Gold | Silver (000) | ||||||||||||||||
Measured | 1,800 | 0.10 | 95.8 | 6,000 | 5,600 | |||||||||||||||||
Indicated | 11,900 | 0.10 | 89.2 | 36,600 | 34,100 | |||||||||||||||||
Measured & Indicated |
13,700 | 0.10 | 90.1 | 42,600 | 39,700 | |||||||||||||||||
Inferred | 8,300 | 0.07 | 118.3 | 19,800 | 31,700 | |||||||||||||||||
Average Grade (grams/tonne) | Contained Ounces | |||||||||||||||||||||
May 20113,4,5,6,7 |
Classification | Tonnes (000s) | Gold | Silver | Gold | Silver (000) | ||||||||||||||||
Measured | | | | | | |||||||||||||||||
Indicated | 7,200 | 0.16 | 85 | 36,200 | 19,700 | |||||||||||||||||
Measured & Indicated |
7,200 | 0.16 | 85 | 36,200 | 19,700 | |||||||||||||||||
Inferred | 13,800 | 0.10 | 108.1 | 43,600 | 48,000 |
1. | Metal prices used were $30 per silver ounce and $1,500 per gold ounce. |
2. | Oxide mineral resources estimated using a cutoff grade of 25 grams per tonne silver and sulfide mineral resources with a cutoff grade of 37 grams per tonne silver within Whittle®-estimated, surface mine, scoping level parameters. |
3. | Mineral resources estimated by the consulting firm of NCL Ingeniería y Construcción Ltda. in Santiago, Chile. |
4. | Mineral resources that are not mineral reserves have not demonstrated economic viability. |
5. | Metal prices used were $20 per silver ounce and $1,300 per gold ounce. |
6. | Oxide mineral resources estimated using a cutoff grade of 33 grams per tonne silver equivalent and sulfide mineral resources with a cutoff grade of 51.9 grams per tonne silver equivalent within Whittle®-estimated, surface mine, scoping level parameters. |
7. | Silver equivalent = gold grade in grams per tonne times 65 + silver grade in grams per tonne. |
2012 Outlook
The Company expects to achieve the high-end of its production guidance for 2012 of 18.5 - 20.0 million ounces of silver and 210,000- 230,000 ounces of gold, and the low-end of its cash operating costs1 guidance for 2012 of $6.50 - $7.50 per silver ounce. Kensingtons cash operating costs1 for the full year 2012 are expected to be unchanged at $1,150 - $1,250 per gold ounce.
Table 5: 2012 Production Outlook
(silver ounces in thousands) |
Country | Silver | Gold | |||
Palmarejo |
Mexico | 8,500-9,000 | 98,000-108,000 | |||
San Bartolomé |
Bolivia | 6,300-6,700 | | |||
Rochester |
Nevada, USA | 2,600-2,900 | 30,000-35,000 | |||
Martha |
Argentina | 700-900 | 400-500 | |||
Endeavor |
Australia | 400-500 | | |||
Kensington |
Alaska, USA | | 82,600-86,500 | |||
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Total |
18,500-20,000 | 210,000-230,000 | ||||
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1. | EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations. |
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Conference Call Information
Coeur will hold a conference call to discuss the Companys second quarter 2012 results at 1 p.m. Eastern time on August 7, 2012.
Dial-In Numbers: | (877) 464-2820 (US and Canada) | |
(660) 422-4718 (International) | ||
Conference ID: | 133 212 42 |
The conference call and presentation will also be webcast on the Companys website www.coeur.com. A replay of the call will be available through August 14, 2012.
Replay number: | (855) 859-2056 (US and Canada) | |
International replay: | (404)537-3406(International) | |
Conference ID: | 133 212 42 |
Cautionary Statement
This news release contains forward-looking statements within the meaning of securities legislation in the United States and Canada, including statements regarding anticipated operating results, production levels, operating costs, and expectations with respect to its Martha mine. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause Coeurs actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, any failure or delay in obtaining required governmental approvals, the risks and hazards inherent in the mining business (including environmental hazards, industrial accidents, weather or geologically related conditions), changes in the market prices of gold and silver, the uncertainties inherent in Coeurs production, exploratory and developmental activities, including risks relating to permitting and regulatory delays and disputed mining claims, any future labor disputes or work stoppages, the uncertainties inherent in the estimation of gold and silver ore reserves, changes that could result from Coeurs future acquisition of new mining properties or businesses, reliance on third parties to operate certain mines where Coeur owns silver production and reserves, the loss of any third-party smelter to which Coeur markets silver and gold, the effects of environmental and other governmental regulations, the risks inherent in the ownership or operation of or investment in mining properties or businesses in foreign countries, Coeurs ability to raise additional financing necessary to conduct its business, make payments or refinance its debt, as well as other uncertainties and risk factors set out in filings made from time to time with the United States Securities and Exchange Commission, and the Canadian securities regulators, including, without limitation, Coeurs reports on Form 10-K and Form 10-Q and Exhibit 99.2 to Coeurs Current Report on Form 8-K filed June 25, 2012. Actual results, developments and timetables could vary significantly from the estimates presented. Readers are cautioned not to put undue reliance on forward-looking statements. Coeur disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise. Current mineralized material estimates include disputed and undisputed claims at Rochester. While the Company believes it holds a superior position in the ongoing claim dispute, the Company believes an adverse legal outcome would cause it to modify mineralized material estimates. Additionally, Coeur undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of Coeur, its financial or operating results or its securities.
Donald J. Birak, Coeurs Senior Vice President of Exploration and a qualified person under Canadian NI 43-101, supervised the preparation of the scientific and technical information concerning Coeurs mineral projects in this news release. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources, as well as data verification procedures and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant factors, please see the Technical Reports for each of Coeurs properties as filed on SEDAR at www.sedar.com.
Cautionary Note to U.S. Investors - The United States Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We may use certain terms in public disclosures, such as measured, indicated, inferred
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and resources, that are recognized by Canadian regulations, but that SEC guidelines generally prohibit U.S. registered companies from including in their filings with the SEC. U.S. investors are urged to consider closely the disclosure in our Form 10-K which may be secured from us, or from the SECs website at http://www.sec.gov.
Non-U.S. GAAP Measures
We supplement the reporting of our financial information determined under United States generally accepted accounting principles (U.S. GAAP) with certain non-U.S. GAAP financial measures, including cash operating costs, operating cash flow, adjusted earnings, and EBITDA. We believe that these adjusted measures provide meaningful information to assist management, investors and analysts in understanding our financial results and assessing our prospects for future performance. We believe these adjusted financial measures are important indicators of our recurring operations because they exclude items that may not be indicative of, or are unrelated to our core operating results, and provide a better baseline for analyzing trends in our underlying businesses. We believe cash operating costs, operating cash flow, adjusted earnings and EBITDA are important measures in assessing the Companys overall financial performance.
About Coeur
Coeur dAlene Mines Corporation is the largest U.S.-based primary silver producer and a growing gold producer. The Company built and commenced production from three wholly-owned, long-lived mines between 2008 and 2010: the San Bartolomé silver mine in Bolivia, the Palmarejo silver-gold mine in Mexico and the Kensington gold mine in Alaska. Further production has commenced from a new heap leach pad at Coeurs long-time Rochester silver-gold mine in Nevada. The Company also owns and operates the Martha silver-gold mine in Argentina and owns a non-operating interest in a silver-base metal mine in Australia. Coeur conducts ongoing exploration activities near and within its operating properties in Argentina, Mexico, Alaska, Nevada and Bolivia. In addition, Coeur owns strategic minority shareholdings in seven silver and gold development companies in North and South America.
For Additional Information:
Wendy Yang, Vice President of Investor Relations
(208) 665-0345
Stefany Bales, Director of Corporate Communications
(208) 667-8263
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Table 6: Operating Statistics from Continuing Operations:
Three months ended June 30, |
Six months ended June 30, |
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2012 | 2011 | 2012 | 2011 | |||||||||||||
Silver Operations: |
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Palmarejo |
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Tons milled |
489,924 | 414,719 | 1,018,467 | 813,459 | ||||||||||||
Ore grade/Ag oz |
5.74 | 7.30 | 5.94 | 6.65 | ||||||||||||
Ore grade/Au oz |
0.07 | 0.08 | 0.07 | 0.08 | ||||||||||||
Recovery/Ag oz |
84.2 | % | 78.3 | % | 80.2 | % | 75.8 | % | ||||||||
Recovery/Au oz |
92.0 | % | 95.2 | % | 92.6 | % | 91.5 | % | ||||||||
Silver production ounces |
2,365,484 | 2,370,536 | 4,848,298 | 4,100,303 | ||||||||||||
Gold production ounces |
31,258 | 33,389 | 62,338 | 61,148 | ||||||||||||
Cash operating cost/oz |
$ | (0.85 | ) | $ | (3.68 | ) | $ | (1.58 | ) | $ | (0.10 | ) | ||||
Cash cost/oz |
$ | (0.85 | ) | $ | (3.68 | ) | $ | (1.58 | ) | $ | (0.10 | ) | ||||
Total production cost/oz |
$ | 17.28 | $ | 14.16 | $ | 15.10 | $ | 18.48 | ||||||||
San Bartolomé |
||||||||||||||||
Tons milled |
391,005 | 378,640 | 769,109 | 766,308 | ||||||||||||
Ore grade/Ag oz |
4.26 | 5.24 | 4.43 | 5.11 | ||||||||||||
Recovery/Ag oz |
88.3 | % | 87.7 | % | 89.8 | % | 88.2 | % | ||||||||
Silver production ounces |
1,470,342 | 1,741,578 | 3,061,634 | 3,452,525 | ||||||||||||
Cash operating cost/oz |
$ | 11.05 | $ | 8.73 | $ | 10.62 | $ | 8.93 | ||||||||
Cash cost/oz |
$ | 12.04 | $ | 10.32 | $ | 11.76 | $ | 10.40 | ||||||||
Total production cost/oz |
$ | 14.89 | $ | 13.51 | $ | 14.44 | $ | 13.44 | ||||||||
Martha |
||||||||||||||||
Tons milled |
39,199 | 22,122 | 73,268 | 39,940 | ||||||||||||
Ore grade/Ag oz |
3.52 | 5.44 | 3.94 | 8.39 | ||||||||||||
Ore grade/Au oz |
0.003 | 0.01 | 0.004 | 0.01 | ||||||||||||
Recovery/Ag oz |
78.2 | % | 84.0 | % | 79.8 | % | 83.8 | % | ||||||||
Recovery/Au oz |
72.4 | % | 72.4 | % | 68.6 | % | 74.3 | % | ||||||||
Silver production ounces |
107,895 | 101,122 | 230,688 | 281,107 | ||||||||||||
Gold production ounces |
97 | 112 | 181 | 356 | ||||||||||||
Cash operating cost/oz |
$ | 55.07 | $ | 38.79 | $ | 50.50 | $ | 29.60 | ||||||||
Cash cost/oz |
$ | 56.21 | $ | 40.47 | $ | 51.39 | $ | 30.86 | ||||||||
Total production cost/oz |
$ | 62.30 | $ | 33.83 | $ | 56.74 | $ | 30.92 | ||||||||
Rochester (A) |
||||||||||||||||
Tons milled |
2,268,896 | | 4,278,414 | | ||||||||||||
Ore grade/Ag oz |
0.63 | | 0.59 | | ||||||||||||
Ore grade/Au oz |
0.005 | | 0.005 | | ||||||||||||
Recovery/Ag oz |
49.8 | % | | 45.7 | % | | ||||||||||
Recovery/Au oz |
84.0 | % | | 74.9 | % | | ||||||||||
Silver production ounces |
712,706 | 333,432 | 1,154,043 | 667,127 | ||||||||||||
Gold production ounces |
10,120 | 1,397 | 15,412 | 2,848 | ||||||||||||
Cash operating cost/oz |
$ | 9.83 | $ | 4.34 | $ | 15.00 | $ | 7.31 | ||||||||
Cash cost/oz |
$ | 11.45 | $ | 6.88 | $ | 16.54 | $ | 9.37 | ||||||||
Total production cost/oz |
$ | 14.66 | $ | 8.92 | $ | 20.02 | $ | 11.22 |
9
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Endeavor |
||||||||||||||||
Tons milled |
201,057 | 207,388 | 396,903 | 374,674 | ||||||||||||
Ore grade/Ag oz |
3.31 | 2.41 | 3.33 | 2.23 | ||||||||||||
Recovery/Ag oz |
36.1 | % | 42.9 | % | 36.9 | % | 43.5 | % | ||||||||
Silver production ounces |
240,168 | 214,613 | 488,126 | 363,795 | ||||||||||||
Cash operating cost/oz |
$ | 17.50 | $ | 20.04 | 17.07 | $ | 18.85 | |||||||||
Cash cost/oz |
$ | 17.50 | $ | 20.04 | 17.07 | $ | 18.85 | |||||||||
Total production cost/oz |
$ | 24.13 | $ | 24.07 | 23.70 | $ | 22.93 | |||||||||
Gold Operation: |
||||||||||||||||
Kensington(B) |
||||||||||||||||
Tons milled |
97,794 | 121,565 | 141,730 | 227,385 | ||||||||||||
Ore grade/Au oz |
0.23 | 0.23 | 0.22 | 0.23 | ||||||||||||
Recovery/Au oz |
94.2 | % | 93.0 | % | 94.0 | % | 92.7 | % | ||||||||
Gold production ounces |
21,572 | 25,758 | 29,016 | 49,434 | ||||||||||||
Cash operating cost/oz |
$ | 1,348 | $ | 924 | $ | 1,697 | $ | 955 | ||||||||
Cash cost/oz |
$ | 1,348 | $ | 924 | $ | 1,697 | $ | 955 | ||||||||
Total production cost/oz |
$ | 1,799 | $ | 1,308 | $ | 2,260 | $ | 1,345 | ||||||||
CONSOLIDATED PRODUCTION TOTALS (B) |
||||||||||||||||
Total silver ounces |
4,896,595 | 4,761,281 | 9,782,789 | 8,864,857 | ||||||||||||
Total gold ounces |
63,047 | 60,656 | 106,947 | 113,786 | ||||||||||||
Silver Operations:(C) |
||||||||||||||||
Cash operating cost per oz - silver |
$ | 6.41 | $ | 3.39 | $ | 6.35 | $ | 5.69 | ||||||||
Cash cost per oz - silver |
$ | 6.97 | $ | 4.19 | $ | 6.91 | $ | 6.46 | ||||||||
Total production cost oz - silver |
$ | 17.51 | $ | 14.42 | $ | 16.88 | $ | 16.55 | ||||||||
Gold Operation:(D) |
||||||||||||||||
Cash operating cost per oz - gold |
$ | 1,348 | $ | 924 | $ | 1,697 | $ | 954.78 | ||||||||
Cash cost per oz - gold |
$ | 1,348 | $ | 924 | $ | 1,697 | $ | 954.78 | ||||||||
Total production cost per oz - gold |
$ | 1,799 | $ | 1,308 | $ | 2,260 | $ | 1,345 | ||||||||
CONSOLIDATED SALES TOTALS (E) |
||||||||||||||||
Silver ounces sold |
5,601,953 | 4,133,283 | 9,892,001 | 7,792,436 | ||||||||||||
Gold ounces sold |
59,579 | 49,930 | 98,464 | 115,852 | ||||||||||||
Realized price per silver ounce |
$ | 29.28 | $ | 39.11 | $ | 30.72 | $ | 35.42 | ||||||||
Realized price per gold ounce |
$ | 1,610 | $ | 1,504 | $ | 1,646 | $ | 1,430 |
(A) | The Rochester mine recommenced production in the fourth quarter of 2011. The leach cycle at Rochester requires five to ten years to recover gold and silver contained in the ore. The Company estimates the ultimate recovery to be approximately 61% for silver and 92% for gold. However, ultimate recoveries will not be known until leaching operations cease, which is currently estimated for 2017. Current recovery may vary significantly from ultimate recovery. See Critical Accounting Policies and Estimates Ore on Leach Pad in the Companys Form 10-K for the year ended December 31, 2011. |
(B) | Current production ounces and recoveries reflect final metal settlements of previously reported production ounces. |
(C) | Amount includes by-product gold credits deducted in computing cash costs per ounce. |
(D) | Amounts reflect Kensington per ounce statistics only. |
(E) | Units sold at realized metal prices will not match reported metal sales due primarily to the effects on revenues of mark-to-market adjustments on embedded derivatives in the Companys provisionally priced sales contracts. |
10
Table 7:
COEUR DALENE MINES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, | December 31, | |||||||
2012 | 2011 | |||||||
(In thousands, except share data) | ||||||||
ASSETS | ||||||||
CURRENT ASSETS |
||||||||
Cash and cash equivalents |
$ | 199,397 | $ | 175,012 | ||||
Short term investments |
907 | 20,254 | ||||||
Receivables |
70,443 | 83,497 | ||||||
Ore on leach pad |
30,562 | 27,252 | ||||||
Metal and other inventory |
145,144 | 132,781 | ||||||
Deferred tax assets |
2,090 | 1,869 | ||||||
Restricted assets |
456 | 60 | ||||||
Prepaid expenses and other |
22,184 | 24,218 | ||||||
|
|
|
|
|||||
471,183 | 464,943 | |||||||
NON-CURRENT ASSETS |
||||||||
Property, plant and equipment, net |
693,026 | 687,676 | ||||||
Mining properties, net |
1,945,763 | 2,001,027 | ||||||
Ore on leach pad, non-current portion |
12,631 | 6,679 | ||||||
Restricted assets |
29,134 | 28,911 | ||||||
Marketable securities |
21,150 | 19,844 | ||||||
Receivables, non-current portion |
45,352 | 40,314 | ||||||
Debt issuance costs, net |
2,738 | 1,889 | ||||||
Deferred tax assets |
132 | 263 | ||||||
Other |
12,401 | 12,895 | ||||||
|
|
|
|
|||||
TOTAL ASSETS |
$ | 3,233,510 | $ | 3,264,441 | ||||
|
|
|
|
|||||
LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||
CURRENT LIABILITIES |
||||||||
Accounts payable |
$ | 66,991 | $ | 78,590 | ||||
Accrued liabilities and other |
8,321 | 13,126 | ||||||
Accrued income taxes |
23,929 | 47,803 | ||||||
Accrued payroll and related benefits |
18,119 | 16,240 | ||||||
Accrued interest payable |
1,437 | 559 | ||||||
Current portion of debt and capital leases |
82,708 | 32,602 | ||||||
Current portion of royalty obligation |
63,269 | 61,721 | ||||||
Current portion of reclamation and mine closure |
4,812 | 1,387 | ||||||
Deferred tax liabilities |
53 | 53 | ||||||
|
|
|
|
|||||
269,639 | 252,081 | |||||||
NON-CURRENT LIABILITIES |
||||||||
Long-term debt and capital leases |
53,974 | 115,861 | ||||||
Non-current portion of royalty obligation |
150,534 | 169,788 | ||||||
Reclamation and mine closure |
30,531 | 32,371 | ||||||
Deferred tax liabilities |
545,031 | 527,573 | ||||||
Other long-term liabilities |
23,091 | 30,046 | ||||||
|
|
|
|
|||||
803,161 | 875,639 | |||||||
COMMITMENTS AND CONTINGENCIES |
||||||||
SHAREHOLDERS EQUITY |
||||||||
Common stock, par value $0.01 per share; authorized 150,000,000 shares, 89,901,675 issued at June 30, 2012 and 89,655,124 issued at December 31, 2011 |
899 | 897 | ||||||
Additional paid-in capital |
2,587,923 | 2,585,632 | ||||||
Accumulated deficit |
(417,885 | ) | (444,833 | ) | ||||
Accumulated other comprehensive loss |
(10,227 | ) | (4,975 | ) | ||||
|
|
|
|
|||||
2,160,710 | 2,136,721 | |||||||
|
|
|
|
|||||
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY |
$ | 3,233,510 | $ | 3,264,441 | ||||
|
|
|
|
11
Table 8:
COEUR DALENE MINES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands, except share data) | ||||||||||||||||
Sales of metal |
$ | 254,406 | $ | 231,090 | $ | 458,970 | $ | 430,714 | ||||||||
Production costs applicable to sales |
(131,823 | ) | (77,102 | ) | (224,377 | ) | (169,576 | ) | ||||||||
Depreciation, depletion and amortization |
(61,024 | ) | (57,641 | ) | (113,616 | ) | (107,682 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Gross profit |
61,559 | 96,347 | 120,977 | 153,456 | ||||||||||||
COSTS AND EXPENSES |
||||||||||||||||
Administrative and general |
8,594 | 1,827 | 16,190 | 14,058 | ||||||||||||
Exploration |
6,305 | 4,077 | 12,872 | 6,839 | ||||||||||||
Loss on impairment and other |
4,813 | | 4,813 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Pre-development, care, maintenance and other |
273 | 11,104 | 1,341 | 14,678 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cost and expenses |
19,985 | 17,008 | 35,216 | 35,575 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
OPERATING INCOME |
41,574 | 79,339 | 85,761 | 117,881 | ||||||||||||
OTHER INCOME AND EXPENSE |
||||||||||||||||
Loss on debt extinguishments |
| (389 | ) | | (856 | ) | ||||||||||
Fair value adjustments, net |
16,039 | (12,432 | ) | (7,074 | ) | (17,700 | ) | |||||||||
Interest income and other, net |
(3,221 | ) | 2,763 | 1,786 | 4,664 | |||||||||||
Interest expense, net of capitalized interest |
(7,557 | ) | (9,268 | ) | (14,227 | ) | (18,573 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total other income and expense, net |
5,261 | (19,326 | ) | (19,515 | ) | (32,465 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
46,835 | 60,013 | 66,246 | 85,416 | ||||||||||||
Income tax provision |
(23,862 | ) | (21,402 | ) | (39,298 | ) | (34,341 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
NET INCOME |
$ | 22,973 | $ | 38,611 | $ | 26,948 | $ | 51,075 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
BASIC AND DILUTED INCOME PER SHARE |
||||||||||||||||
Basic income per share: |
||||||||||||||||
Net income |
$ | 0.26 | $ | 0.43 | $ | 0.30 | $ | 0.57 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Diluted income per share: |
||||||||||||||||
Net income |
$ | 0.26 | $ | 0.43 | $ | 0.30 | $ | 0.57 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average number of shares of common stock |
||||||||||||||||
Basic |
89,631 | 89,310 | 89,611 | 89,299 | ||||||||||||
Diluted |
89,733 | 89,712 | 89,777 | 89,683 |
12
Table 9:
COEUR DALENE MINES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||||||||||
Net income |
$ | 22,973 | $ | 38,611 | $ | 26,948 | $ | 51,075 | ||||||||
Add (deduct) non-cash items |
||||||||||||||||
Depreciation, depletion and amortization |
61,024 | 57,641 | 113,616 | 107,682 | ||||||||||||
Accretion of discount on debt and other assets, net |
808 | 494 | 1,605 | 944 | ||||||||||||
Accretion of royalty obligation |
5,492 | 5,770 | 10,072 | 11,037 | ||||||||||||
Deferred income taxes |
9,690 | 4,223 | 17,368 | 10,093 | ||||||||||||
Loss on debt extinguishment |
| 389 | | 856 | ||||||||||||
Fair value adjustments, net |
(17,759 | ) | 13,933 | 4,018 | 20,593 | |||||||||||
Gain (loss) on foreign currency transactions |
70 | (848 | ) | 369 | (737 | ) | ||||||||||
Share-based compensation |
1,033 | (3,351 | ) | 3,170 | 4,804 | |||||||||||
(Gain) loss on sale of assets |
264 | (1,223 | ) | 264 | (1,224 | ) | ||||||||||
Loss on impairment |
4,813 | | 4,813 | | ||||||||||||
Other non-cash charges |
(40 | ) | 200 | (40 | ) | 831 | ||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||
Receivables and other current assets |
10,319 | (8,138 | ) | 7,365 | (12,979 | ) | ||||||||||
Prepaid expenses and other |
(2,857 | ) | 1,354 | 1,916 | 1,335 | |||||||||||
Inventories |
3,097 | (23,575 | ) | (21,625 | ) | (36,068 | ) | |||||||||
Accounts payable and accrued liabilities |
14,276 | 25,585 | (39,655 | ) | (11,392 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
CASH PROVIDED BY OPERATING ACTIVITIES |
113,203 | 111,065 | 130,204 | 146,850 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||||||||||
Purchase of short term investments and marketable securities |
(6,831 | ) | (11,881 | ) | (7,866 | ) | (13,110 | ) | ||||||||
Proceeds from sales and maturities of short term investments |
683 | 2,773 | 20,701 | 3,360 | ||||||||||||
Capital expenditures |
(32,238 | ) | (25,764 | ) | (63,885 | ) | (41,681 | ) | ||||||||
Other |
995 | 325 | 1,180 | 273 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
CASH USED IN INVESTING ACTIVITIES |
(37,391 | ) | (34,547 | ) | (49,870 | ) | (51,158 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||||||||||
Proceeds from issuance of notes and bank borrowings |
| | | 27,500 | ||||||||||||
Payments on long-term debt, capital leases, and associated costs |
(8,794 | ) | (16,704 | ) | (14,244 | ) | (34,099 | ) | ||||||||
Payments on gold production royalty |
(19,287 | ) | (17,441 | ) | (40,660 | ) | (32,059 | ) | ||||||||
Payments on gold lease facility |
| | | (13,800 | ) | |||||||||||
Additions to restricted assets associated with the Kensington Term Facility |
| | | (1,325 | ) | |||||||||||
Other |
(217 | ) | 30 | (1,045 | ) | (1,197 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
CASH USED IN FINANCING ACTIVITIES |
(28,298 | ) | (34,115 | ) | (55,949 | ) | (54,980 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
INCREASE IN CASH AND CASH EQUIVALENTS |
47,514 | 42,403 | 24,385 | 40,712 | ||||||||||||
Cash and cash equivalents at beginning of period |
151,883 | 64,427 | 175,012 | 66,118 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Cash and cash equivalents at end of period |
$ | 199,397 | $ | 106,830 | $ | 199,397 | $ | 106,830 | ||||||||
|
|
|
|
|
|
|
|
13
Table 10:
Operating Cash Flow Reconciliation
(in thousands) | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by operating activities |
$ | 113,203 | $ | 17,002 | $ | 87,412 | $ | 181,911 | $ | 111,065 | ||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
(10,319 | ) | 2,956 | (8,904 | ) | 10,513 | 8,138 | |||||||||||||
Prepaid expenses and other |
2,857 | (4,774 | ) | 8,839 | 8,697 | (1,354 | ) | |||||||||||||
Inventories |
(3,097 | ) | 24,722 | 17,574 | (23,234 | ) | 23,575 | |||||||||||||
Accounts payable and accrued liabilities |
(14,276 | ) | 53,929 | (7,452 | ) | (26,930 | ) | (25,585 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 88,368 | $ | 93,835 | $ | 97,469 | $ | 150,957 | $ | 115,839 | ||||||||||
|
|
|
|
|
|
|
|
|
|
Table 11:
EBITDA Reconciliation
(in thousands) | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Net income (loss) |
$ | 22,973 | $ | 3,975 | $ | 11,364 | $ | 31,060 | $ | 38,611 | ||||||||||
Income tax provision |
23,862 | 15,436 | 52,390 | 27,606 | 21,402 | |||||||||||||||
Interest expense, net of capitalized interest |
7,557 | 6,670 | 8,222 | 7,980 | 9,268 | |||||||||||||||
Interest and other income |
3,221 | (5,007 | ) | 4,697 | 6,610 | (2,763 | ) | |||||||||||||
Fair value adjustments, net |
(16,039 | ) | 23,113 | (19,035 | ) | 53,351 | 12,432 | |||||||||||||
Loss on debt extinguishments |
| | 3,886 | 784 | 389 | |||||||||||||||
Depreciation and depletion |
61,024 | 52,592 | 58,166 | 58,652 | 57,641 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 102,598 | $ | 96,779 | $ | 119,690 | $ | 186,043 | $ | 136,980 | ||||||||||
|
|
|
|
|
|
|
|
|
|
Table 12:
Adjusted Earnings Reconciliation
(in thousands) | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Net income (loss) |
$ | 22,973 | $ | 3,975 | $ | 11,364 | $ | 31,060 | $ | 38,611 | ||||||||||
Share Based Compensation |
1,033 | 2,137 | 2,861 | 457 | (3,351 | ) | ||||||||||||||
Deferred income tax provision |
9,690 | 7,677 | 38,614 | 3,110 | 4,198 | |||||||||||||||
Interest expense, accretion of royalty obligation |
5,492 | 4,580 | 5,523 | 4,990 | 5,770 | |||||||||||||||
Fair value adjustments, net |
(16,039 | ) | 23,113 | (19,035 | ) | 53,351 | 12,432 | |||||||||||||
Loss on impairment |
4,813 | | | | | |||||||||||||||
Loss on debt extinguishments |
| | 3,886 | 784 | 389 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Adjusted Earnings (Loss) |
$ | 27,962 | $ | 41,482 | $ | 43,213 | $ | 93,752 | $ | 58,049 | ||||||||||
|
|
|
|
|
|
|
|
|
|
14
Table 13:
Results of Operations by Mine - Palmarejo
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 136.4 | $ | 123.7 | $ | 134.3 | $ | 166.9 | $ | 123.7 | ||||||||||
Production Costs |
$ | 62.5 | $ | 45.9 | $ | 47.0 | $ | 64.1 | $ | 37.7 | ||||||||||
EBITDA |
$ | 72.3 | $ | 76.5 | $ | 83.7 | $ | 100.4 | $ | 84.6 | ||||||||||
Operating Income |
$ | 29.5 | $ | 38.8 | $ | 38.7 | $ | 61.6 | $ | 43.0 | ||||||||||
Operating Cash Flow |
$ | 63.6 | $ | 81.4 | $ | 77.4 | $ | 91.2 | $ | 81.8 | ||||||||||
Capital Expenditures |
$ | 11.2 | $ | 7.2 | $ | 12.1 | $ | 9.5 | $ | 10.3 | ||||||||||
Gross Profit |
$ | 31.1 | $ | 40.1 | $ | 44.7 | $ | 61.6 | $ | 44.2 | ||||||||||
Gross Margin |
22.8 | % | 32.4 | % | 33.3 | % | 36.9 | % | 35.7 | % | ||||||||||
2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Underground Operations: |
||||||||||||||||||||
Tons Mined |
162,820 | 158,030 | 191,966 | 143,010 | 144,614 | |||||||||||||||
Average Silver Grade (oz/t) |
8.91 | 7.82 | 8.04 | 9.36 | 10.08 | |||||||||||||||
Average Gold Grade (oz/t) |
0.14 | 0.11 | 0.11 | 0.13 | 0.14 | |||||||||||||||
Surface Operations: |
||||||||||||||||||||
Tons Mined |
321,758 | 347,609 | 321,881 | 260,618 | 276,699 | |||||||||||||||
Average Silver Grade (oz/t) |
4.14 | 5.32 | 5.88 | 6.56 | 5.85 | |||||||||||||||
Average Gold Grade (oz/t) |
0.04 | 0.04 | 0.05 | 0.05 | 0.06 | |||||||||||||||
Processing: |
||||||||||||||||||||
Total Tons Milled |
489,924 | 528,543 | 505,619 | 403,978 | 414,719 | |||||||||||||||
Average Recovery Rate Ag |
84.2 | % | 76.8 | % | 77.9 | % | 75.9 | % | 78.3 | % | ||||||||||
Average Recovery Rate Au |
92.0 | % | 93.3 | % | 92.4 | % | 93.6 | % | 95.2 | % | ||||||||||
Silver Production - oz (000s) |
2,365 | 2,483 | 2,690 | 2,251 | 2,371 | |||||||||||||||
Gold Production - oz |
31,258 | 31,081 | 34,108 | 29,815 | 33,389 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | (0.85 | ) | $ | (2.27 | ) | $ | (2.13 | ) | $ | (1.16 | ) | $ | (3.68 | ) |
Table 14:
Reconciliation of EBITDA for Palmarejo
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 136.4 | $ | 123.7 | $ | 134.3 | $ | 166.9 | $ | 123.7 | ||||||||||
Production costs applicable to sales |
$ | (62.5 | ) | (45.9 | ) | (47.0 | ) | (64.1 | ) | (37.8 | ) | |||||||||
Administrative and general |
$ | | | | | | ||||||||||||||
Exploration |
$ | (1.6 | ) | (1.3 | ) | (2.8 | ) | (2.2 | ) | (1.3 | ) | |||||||||
Care and maintenance and other |
$ | | | (0.8 | ) | (0.2 | ) | | ||||||||||||
Pre-development |
$ | | | | | | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 72.3 | $ | 76.5 | $ | 83.7 | $ | 100.4 | $ | 84.6 | ||||||||||
|
|
|
|
|
|
|
|
|
|
15
Table 15:
Operating Cash Flow for Palmarejo
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by operating activities |
$ | 90.5 | $ | 63.0 | $ | 70.9 | $ | 104.7 | $ | 62.9 | ||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
$ | (12.5 | ) | 5.4 | 5.7 | (0.8 | ) | 8.9 | ||||||||||||
Prepaid expenses and other |
$ | 0.5 | (1.9 | ) | (3.2 | ) | 3.4 | (0.4 | ) | |||||||||||
Inventories |
$ | (11.5 | ) | 4.0 | 9.9 | (16.2 | ) | 12.0 | ||||||||||||
Accounts payable and accrued liabilities |
$ | (3.4 | ) | 8.6 | (5.9 | ) | 0.1 | (1.6 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 63.6 | $ | 79.1 | $ | 77.4 | $ | 91.2 | $ | 81.8 | ||||||||||
|
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|
Table 16:
Results of Operations by Mine - San Bartolomé
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 53.4 | $ | 41.4 | $ | 62.8 | $ | 102.8 | $ | 55.6 | ||||||||||
Production Costs |
$ | 22.8 | $ | 13.6 | $ | 21.4 | $ | 30.1 | $ | 14.1 | ||||||||||
EBITDA |
$ | 30.5 | $ | 27.7 | $ | 41.2 | $ | 72.5 | $ | 41.4 | ||||||||||
Operating Income |
$ | 26.6 | $ | 23.5 | $ | 34.9 | $ | 66.7 | $ | 36.2 | ||||||||||
Operating Cash Flow |
$ | 24.8 | $ | 20.8 | $ | 28.7 | $ | 49.6 | $ | 25.7 | ||||||||||
Capital Expenditures |
$ | 7.8 | $ | 10.2 | $ | 6.5 | $ | 4.4 | $ | 3.3 | ||||||||||
Gross Profit |
$ | 26.5 | $ | 23.5 | $ | 35.3 | $ | 66.7 | $ | 36.3 | ||||||||||
Gross Margin |
49.6 | % | 56.8 | % | 56.2 | % | 64.9 | % | 65.3 | % | ||||||||||
1Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Tons Milled |
391,005 | 378,104 | 371,983 | 428,978 | 378,640 | |||||||||||||||
Average Silver Grade (oz/t) |
4.3 | 4.6 | 5.4 | 5.4 | 5.2 | |||||||||||||||
Average Recovery Rate |
88.3 | % | 91.2 | % | 90.5 | % | 88.6 | % | 87.7 | % | ||||||||||
Silver Production (000s) |
1,470 | 1,591 | 1,997 | 2,051 | 1,742 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | 11.05 | $ | 10.21 | $ | 9.18 | $ | 9.32 | $ | 8.73 |
Table 17:
Reconciliation of EBITDA for San Bartolomé
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 53.4 | $ | 41.4 | $ | 62.8 | $ | 102.8 | $ | 55.6 | ||||||||||
Production costs applicable to sales |
(22.8 | ) | (13.6 | ) | (21.4 | ) | (30.1 | ) | (14.1 | ) | ||||||||||
Administrative and general |
| | | | | |||||||||||||||
Exploration |
(0.1 | ) | (0.1 | ) | | (0.1 | ) | (0.1 | ) | |||||||||||
Care and maintenance and other |
| | (0.2 | ) | (0.1 | ) | | |||||||||||||
Pre-development |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 30.5 | $ | 27.7 | $ | 41.2 | $ | 72.5 | $ | 41.4 | ||||||||||
|
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|
|
|
|
|
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|
16
Table 18:
Operating Cash Flow for San Bartolomé
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by (used in) operating activities |
$ | 31.0 | $ | (27.4 | ) | $ | 22.3 | $ | 78.1 | $ | 38.2 | |||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
$ | (0.7 | ) | 2.2 | 0.2 | 5.0 | 1.5 | |||||||||||||
Prepaid expenses and other |
$ | 4.4 | (2.8 | ) | 4.6 | 0.2 | (0.6 | ) | ||||||||||||
Inventories |
$ | (3.4 | ) | 4.7 | 2.9 | (7.2 | ) | 4.0 | ||||||||||||
Accounts payable and accrued liabilities |
$ | (6.5 | ) | 44.1 | (1.3 | ) | (26.5 | ) | (17.4 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 24.8 | $ | 20.8 | $ | 28.7 | $ | 49.6 | $ | 25.7 | ||||||||||
|
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|
|
|
|
|
|
|
Table 19:
Results of Operations by Mine - Kensington
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 21.1 | $ | 10.4 | $ | 32.9 | $ | 44.2 | $ | 26.0 | ||||||||||
Production Costs |
$ | 16.1 | $ | 17.1 | $ | 31.7 | $ | 24.3 | $ | 12.8 | ||||||||||
EBITDA |
$ | 4.7 | $ | (6.9 | ) | $ | 0.5 | $ | 19.6 | $ | 12.8 | |||||||||
Operating Income/(Loss) |
$ | (5.0 | ) | $ | (13.6 | ) | $ | (6.6 | ) | $ | 10.3 | $ | 2.8 | |||||||
Operating Cash Flow |
$ | 0.6 | $ | (7.8 | ) | $ | (4.1 | ) | $ | 14.5 | $ | 11.7 | ||||||||
Capital Expenditures |
$ | 9.3 | $ | 10.9 | $ | 12.0 | $ | 9.2 | $ | 7.4 | ||||||||||
Gross Profit/(Loss) |
$ | (4.7 | ) | $ | (13.3 | ) | $ | (5.7 | ) | $ | 10.3 | $ | 3.3 | |||||||
Gross Margin |
(22.3 | )% | (127.9 | )% | (17.3 | )% | 23.3 | % | 12.7 | % | ||||||||||
2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Tons Milled |
97,794 | 43,936 | 71,700 | 116,255 | 121,565 | |||||||||||||||
Average Gold Grade (oz/t) |
0.23 | 0.18 | 0.19 | 0.24 | 0.23 | |||||||||||||||
Average Recovery Rate |
94.2 | % | 93.4 | % | 96.5 | % | 91.7 | % | 93 | % | ||||||||||
Gold Production |
21,572 | 7,444 | 13,299 | 25,687 | 25,758 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | 1,348 | $ | 2,709 | $ | 1,807 | $ | 973 | $ | 924 |
Table 20:
Reconciliation of EBITDA for Kensington
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 21.1 | $ | 10.4 | $ | 32.9 | $ | 44.2 | $ | 26.0 | ||||||||||
Production costs applicable to sales |
(16.1 | ) | (17.1 | ) | (31.7 | ) | (24.3 | ) | (12.8 | ) | ||||||||||
Administrative and general |
| | | | | |||||||||||||||
Exploration |
(0.3 | ) | (0.2 | ) | (0.5 | ) | (0.3 | ) | (0.3 | ) | ||||||||||
Care and maintenance and other |
| | (0.2 | ) | | (0.1 | ) | |||||||||||||
Pre-development |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 4.7 | $ | (6.9 | ) | $ | 0.5 | $ | 19.6 | $ | 12.8 | |||||||||
|
|
|
|
|
|
|
|
|
|
17
Table 21:
Operating Cash Flow for Kensington
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by operating activities |
$ | (12.5 | ) | $ | 1.1 | $ | 9.3 | $ | 8.6 | $ | 7.6 | |||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
$ | 4.6 | (10.3 | ) | (5.1 | ) | 5.0 | (1.0 | ) | |||||||||||
Prepaid expenses and other |
$ | (0.5 | ) | (1.0 | ) | 0.5 | 1.3 | 0.2 | ||||||||||||
Inventories |
$ | 9.9 | 3.3 | (10.1 | ) | (1.3 | ) | 8.0 | ||||||||||||
Accounts payable and accrued liabilities |
$ | (0.9 | ) | (0.9 | ) | 1.3 | 0.9 | (3.1 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 0.6 | $ | (7.8 | ) | $ | (4.1 | ) | $ | 14.5 | $ | 11.7 | ||||||||
|
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|
|
|
|
|
|
|
Table 22:
Results of Operations by Mine - Rochester
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 34.2 | $ | 18.8 | $ | 11.1 | $ | 17.5 | $ | 14.4 | ||||||||||
Production Costs |
$ | 20.8 | $ | 9.6 | $ | 4.2 | $ | 11.4 | $ | 5.3 | ||||||||||
EBITDA |
$ | 11.6 | $ | 7.2 | $ | 3.2 | $ | 2.7 | $ | (2.2 | ) | |||||||||
Operating Income/(Loss) |
$ | 9.5 | $ | 5.5 | $ | 4.6 | $ | 2.1 | $ | (2.9 | ) | |||||||||
Operating Cash Flow |
$ | 11.8 | $ | 7.2 | $ | 3.4 | $ | 2.7 | $ | (3.9 | ) | |||||||||
Capital Expenditures |
$ | 2.9 | $ | 2.6 | $ | 7.7 | $ | 13.6 | $ | 4.2 | ||||||||||
Gross Profit |
$ | 11.3 | $ | 7.6 | $ | 5.9 | $ | 5.5 | $ | 8.5 | ||||||||||
Gross Margin |
33.0 | % | 40.4 | % | 53.2 | % | 31.4 | % | 59.0 | % | ||||||||||
2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Silver Production (000s) |
713 | 441 | 373 | 352 | 333 | |||||||||||||||
Gold Production |
10,120 | 5,292 | 1,993 | 1,435 | 1,397 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | 9.83 | $ | 23.35 | $ | 37.99 | $ | 36.71 | $ | 4.34 |
Table 23:
Reconciliation of EBITDA for Rochester
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 34.2 | $ | 18.8 | $ | 11.1 | $ | 17.5 | $ | 14.4 | ||||||||||
Production costs applicable to sales |
(20.8 | ) | (9.6 | ) | (4.2 | ) | (11.4 | ) | (5.3 | ) | ||||||||||
Administrative and general |
| | | | | |||||||||||||||
Exploration |
(1.1 | ) | (0.7 | ) | (1.5 | ) | (0.2 | ) | (0.3 | ) | ||||||||||
Care and maintenance and other |
(0.7 | ) | (1.3 | ) | (2.2 | ) | (3.2 | ) | (11.0 | ) | ||||||||||
Pre-development |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 11.6 | $ | 7.2 | $ | 3.2 | $ | 2.7 | $ | (2.2 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
18
Table 24:
Operating Cash Flow for Rochester
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by (used in) operating activities |
$ | 10.1 | $ | (7.1 | ) | $ | (11.4 | ) | $ | 0.9 | $ | (2.1 | ) | |||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
$ | (0.1 | ) | 0.3 | (0.2 | ) | 0.2 | | ||||||||||||
Prepaid expenses and other |
$ | (1.0 | ) | 1.4 | 0.7 | 0.7 | 0.4 | |||||||||||||
Inventories |
$ | 3.9 | 11.2 | 14.2 | 5.9 | 0.6 | ||||||||||||||
Accounts payable and accrued liabilities |
$ | (1.1 | ) | 1.4 | 0.1 | (5.0 | ) | (2.8 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 11.8 | $ | 7.2 | $ | 3.4 | $ | 2.7 | $ | (3.9 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
Table 25:
Results of Operations by Mine - Martha
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 4.1 | $ | 3.6 | $ | 2.8 | $ | 6.0 | $ | 4.8 | ||||||||||
Production Costs |
$ | 7.1 | $ | 3.7 | $ | 3.9 | $ | 8.1 | $ | 3.9 | ||||||||||
EBITDA |
$ | (10.6 | ) | $ | (3.7 | ) | $ | (3.3 | ) | $ | (3.8 | ) | $ | (0.5 | ) | |||||
Operating Loss |
$ | (11.3 | ) | $ | (4.3 | ) | $ | (3.0 | ) | $ | (4.0 | ) | $ | (0.4 | ) | |||||
Operating Cash Flow |
$ | (5.5 | ) | $ | (5.1 | ) | $ | (5.0 | ) | $ | (1.7 | ) | $ | (0.9 | ) | |||||
Capital Expenditures |
$ | 0.5 | $ | 0.7 | $ | 1.4 | $ | 1.1 | $ | 0.6 | ||||||||||
Gross Profit/(Loss) |
$ | (3.7 | ) | $ | (0.7 | ) | $ | (1.7 | ) | $ | (2.3 | ) | $ | 1.8 | ||||||
Gross Margin |
(90.2 | )% | (19.4 | )% | (60.7 | )% | (38.3 | )% | 37.5 | % | ||||||||||
2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Total Tons Milled |
39,199 | 34,069 | 37,141 | 24,086 | 22,122 | |||||||||||||||
Average Silver Grade (oz/t) |
3.52 | 4.43 | 4.65 | 5.33 | 5.44 | |||||||||||||||
Average Gold Grade (oz/t) |
| | 0.01 | 0.01 | 0.01 | |||||||||||||||
Average Recovery Rate Ag |
78.2 | % | 81.4 | % | 75.2 | % | 92.3 | % | 84 | % | ||||||||||
Average Recovery Rate Au |
72.4 | % | 64.6 | % | 74.2 | % | 72.9 | % | 72.4 | % | ||||||||||
Silver Production (000s) |
108 | 123 | 130 | 119 | 101 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | 55.07 | $ | 46.48 | $ | 33.75 | $ | 39.31 | $ | 38.79 |
Table 26:
Reconciliation of EBITDA for Martha
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 4.1 | $ | 3.6 | $ | 2.8 | $ | 6.0 | $ | 4.8 | ||||||||||
Production costs applicable to sales |
(7.1 | ) | (3.7 | ) | (3.9 | ) | (8.2 | ) | (3.8 | ) | ||||||||||
Administrative and general |
| | | | | |||||||||||||||
Exploration |
(2.8 | ) | (3.4 | ) | (2.1 | ) | (1.5 | ) | (1.5 | ) | ||||||||||
Care and maintenance and other |
(4.8 | ) | (0.2 | ) | (0.1 | ) | (0.1 | ) | | |||||||||||
Pre-development |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
EBITDA |
$ | (10.6 | ) | $ | (3.7 | ) | $ | (3.3 | ) | $ | (3.8 | ) | $ | (0.5 | ) | |||||
|
|
|
|
|
|
|
|
|
|
19
Table 27:
Operating Cash Flow for Martha
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by (used in) operating activities |
$ | (3.3 | ) | $ | (7.1 | ) | $ | (3.2 | ) | $ | 0.2 | $ | (3.2 | ) | ||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
(0.6 | ) | 3.5 | (0.9 | ) | 2.3 | 0.2 | |||||||||||||
Prepaid expenses and other |
0.1 | (0.1 | ) | (0.3 | ) | 0.4 | 0.1 | |||||||||||||
Inventories |
(2.3 | ) | 0.4 | 0.4 | (3.3 | ) | 0.1 | |||||||||||||
Accounts payable and accrued liabilities |
0.6 | (1.8 | ) | (1.0 | ) | (1.3 | ) | 1.9 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | (5.5 | ) | $ | (5.1 | ) | $ | (5.0 | ) | $ | (1.7 | ) | $ | (0.9 | ) | |||||
|
|
|
|
|
|
|
|
|
|
Table 28:
Results of Operations by Mine - Endeavor
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of Metal |
$ | 5.2 | $ | 6.7 | $ | 2.8 | $ | 6.2 | $ | 6.6 | ||||||||||
Production Costs |
$ | 2.6 | $ | 2.7 | $ | 1.0 | $ | 3.2 | $ | 3.3 | ||||||||||
EBITDA |
$ | 2.6 | $ | 4.0 | $ | 1.8 | $ | 3.0 | $ | 3.3 | ||||||||||
Operating Income |
$ | 1.1 | $ | 2.3 | $ | 1.1 | $ | 2.1 | $ | 2.4 | ||||||||||
Operating Cash Flow |
$ | 2.8 | $ | 3.5 | $ | 2.1 | $ | 1.3 | $ | 3.6 | ||||||||||
Capital Expenditures |
$ | | $ | | $ | | $ | | $ | | ||||||||||
Gross Profit |
$ | 1.1 | $ | 2.3 | $ | 1.1 | $ | 2.1 | $ | 2.4 | ||||||||||
Gross Margin |
21.2 | % | 34.3 | % | 39.3 | % | 33.9 | % | 36.4 | % | ||||||||||
2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | ||||||||||||||||
Silver Production (000s) |
240 | 248 | 111 | 138 | 215 | |||||||||||||||
Cash Operating Costs/Ag Oz |
$ | 17.50 | $ | 16.64 | $ | 14.74 | $ | 22.26 | $ | 20.04 |
Table 29:
Reconciliation of EBITDA for Endeavor
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Sales of metal |
$ | 5.2 | $ | 6.7 | $ | 2.8 | $ | 6.2 | $ | 6.6 | ||||||||||
Production costs applicable to sales |
(2.6 | ) | (2.7 | ) | (1.0 | ) | (3.2 | ) | (3.3 | ) | ||||||||||
Administrative and general |
| | | | | |||||||||||||||
Exploration |
| | | | | |||||||||||||||
Care and maintenance and other |
| | | | | |||||||||||||||
Pre-development |
| | | | | |||||||||||||||
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|
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|
|
|
|
|
|
|||||||||||
EBITDA |
$ | 2.6 | $ | 4.0 | $ | 1.8 | $ | 3.0 | $ | 3.3 | ||||||||||
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20
Table 30:
Operating Cash Flow for Endeavor
in millions of US$ | 2Q 2012 | 1Q 2012 | 4Q 2011 | 3Q 2011 | 2Q 2011 | |||||||||||||||
Cash provided by operating activities |
$ | 3.6 | $ | 2.5 | $ | 2.1 | $ | 2.4 | $ | 2.5 | ||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Receivables and other current assets |
(1.7 | ) | 1.7 | (1.2 | ) | (1.4 | ) | 2.7 | ||||||||||||
Prepaid expenses and other |
| | | | | |||||||||||||||
Inventories |
0.2 | 0.6 | 0.1 | (0.9 | ) | | ||||||||||||||
Accounts payable and accrued liabilities |
0.7 | (1.3 | ) | 1.1 | 1.2 | (1.6 | ) | |||||||||||||
|
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|
|
|
|
|
|
|
|
|||||||||||
Operating Cash Flow |
$ | 2.8 | $ | 3.5 | $ | 2.1 | $ | 1.3 | $ | 3.6 | ||||||||||
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|
Table 31:
Reconciliation of Non-U.S. GAAP Cash Costs to U.S. GAAP Production Costs
Three months ended June 30, 2012
(In thousands except ounces and per ounce costs) | Palmarejo | San Bartolomé |
Kensington | Rochester | Martha | Endeavor | Total | |||||||||||||||||||||
Total cash operating cost (Non-U.S. GAAP) |
$ | (2,009 | ) | $ | 16,249 | $ | 29,083 | $ | 7,008 | $ | 5,942 | $ | 4,204 | $ | 60,477 | |||||||||||||
Royalties |
| 1,457 | | 510 | 124 | | 2,091 | |||||||||||||||||||||
Production taxes |
| | | 641 | | | 641 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total cash costs (Non-U.S. GAAP) |
$ | (2,009 | ) | $ | 17,706 | $ | 29,083 | $ | 8,159 | $ | 6,066 | $ | 4,204 | $ | 63,209 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Add/Subtract: |
||||||||||||||||||||||||||||
Third party smelting costs |
| | (2,820 | ) | | (1,444 | ) | (1,449 | ) | (5,713 | ) | |||||||||||||||||
By-product credit |
50,363 | | | 16,295 | 157 | | 66,815 | |||||||||||||||||||||
Other adjustments |
124 | 117 | 7 | 229 | 26 | | 503 | |||||||||||||||||||||
Change in inventory |
14,060 | 4,950 | (10,165 | ) | (3,931 | ) | 2,297 | (202 | ) | 7,009 | ||||||||||||||||||
Depreciation, depletion and amortization |
42,741 | 4,070 | 9,719 | 2,060 | 631 | 1,592 | 60,813 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production costs applicable to sales, including depreciation, depletion and amortization (U.S. GAAP) |
$ | 105,279 | $ | 26,843 | $ | 25,824 | $ | 22,812 | $ | 7,733 | $ | 4,145 | $ | 192,636 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production of silver (ounces) |
2,365,484 | 1,470,342 | | 712,706 | 107,895 | 240,168 | 4,896,595 | |||||||||||||||||||||
Cash operating cost per silver ounce |
$ | (0.85 | ) | $ | 11.05 | $ | | $ | 9.83 | $ | 55.07 | $ | 17.50 | $ | 6.41 | |||||||||||||
Cash costs per silver ounce |
$ | (0.85 | ) | $ | 12.04 | $ | | $ | 11.45 | $ | 56.21 | $ | 17.50 | $ | 6.97 | |||||||||||||
Production of gold (ounces) |
| | 21,572 | | | | 21,572 | |||||||||||||||||||||
Cash operating cost per gold ounce |
$ | | $ | | $ | 1,348 | $ | | $ | | $ | | $ | 1,348 | ||||||||||||||
Cash cost per gold ounce |
$ | | $ | | $ | 1,348 | $ | | $ | | $ | | $ | 1,348 |
21
Table 32:
Reconciliation of Non-U.S. GAAP Cash Costs to U.S. GAAP Production Costs
Six months ended June 30, 2012
(In thousands except ounces and per ounce costs) | Palmarejo | San Bartolomé |
Kensington | Rochester | Martha | Endeavor | Total | |||||||||||||||||||||
Total cash operating cost (Non-U.S. GAAP) |
$ | (7,652 | ) | $ | 32,502 | $ | 49,251 | $ | 17,311 | $ | 11,649 | $ | 8,331 | $ | 111,392 | |||||||||||||
Royalties |
| 3,493 | | 1,119 | 206 | | 4,818 | |||||||||||||||||||||
Production taxes |
| | | 653 | | | 653 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total cash costs (Non-U.S. GAAP) |
$ | (7,652 | ) | $ | 35,995 | $ | 49,251 | $ | 19,083 | $ | 11,855 | $ | 8,331 | $ | 116,863 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Add/Subtract: |
||||||||||||||||||||||||||||
Third party smelting costs |
| | (3,903 | ) | | (3,418 | ) | (2,238 | ) | (9,559 | ) | |||||||||||||||||
By-product credit |
102,889 | | | 25,252 | 298 | | 128,439 | |||||||||||||||||||||
Other adjustments |
368 | (77 | ) | 14 | 316 | 83 | | 704 | ||||||||||||||||||||
Change in inventory |
12,793 | 463 | (12,166 | ) | (14,335 | ) | 1,977 | (803 | ) | (12,071 | ) | |||||||||||||||||
Depreciation, depletion and amortization |
80,501 | 8,289 | 16,324 | 3,702 | 1,151 | 3,236 | 113,203 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production costs applicable to sales, including depreciation, depletion and amortization (U.S. GAAP) |
$ | 188,899 | $ | 44,670 | $ | 49,520 | $ | 34,018 | $ | 11,946 | $ | 8,526 | $ | 337,579 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production of silver (ounces) |
4,848,298 | 3,061,634 | | 1,154,043 | 230,688 | 488,126 | 9,782,789 | |||||||||||||||||||||
Cash operating cost per silver ounce |
$ | (1.58 | ) | $ | 10.62 | $ | | $ | 15.00 | $ | 50.50 | $ | 17.07 | $ | 6.35 | |||||||||||||
Cash costs per silver ounce |
$ | (1.58 | ) | $ | 11.76 | $ | | $ | 16.54 | $ | 51.39 | $ | 17.07 | $ | 6.91 | |||||||||||||
Production of gold (ounces) |
| | 29,016 | | | | 29,016 | |||||||||||||||||||||
Cash operating cost per gold ounce |
$ | | $ | | $ | 1,697 | $ | | $ | | $ | | $ | 1,697 | ||||||||||||||
Cash cost per gold ounce |
$ | | $ | | $ | 1,697 | $ | | $ | | $ | | $ | 1,697 |
22
Table 33:
Reconciliation of Non-U.S. GAAP Cash Costs to U.S. GAAP Production Costs
Three months ended June 30, 2011
(In thousands except ounces and per ounce costs) | Palmarejo | San Bartolomé |
Kensington | Rochester | Martha | Endeavor | Total | |||||||||||||||||||||
Total cash operating cost (Non-U.S. GAAP) |
$ | (8,719 | ) | $ | 15,211 | $ | 23,789 | $ | 1,446 | $ | 3,922 | $ | 4,301 | $ | 39,950 | |||||||||||||
Royalties |
| 2,760 | | 578 | 170 | | 3,508 | |||||||||||||||||||||
Production taxes |
| | | 268 | | | 268 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total cash costs (Non-U.S. GAAP) |
$ | (8,719 | ) | $ | 17,971 | $ | 23,789 | $ | 2,292 | $ | 4,092 | $ | 4,301 | $ | 43,726 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Add/Subtract: |
||||||||||||||||||||||||||||
Third party smelting costs |
| | (3,375 | ) | | (426 | ) | (1,018 | ) | (4,819 | ) | |||||||||||||||||
By-product credit |
50,188 | | | 2,106 | 169 | | 52,463 | |||||||||||||||||||||
Other adjustments |
552 | 376 | 19 | 97 | 76 | | 1,120 | |||||||||||||||||||||
Change in inventory |
(4,252 | ) | (4,221 | ) | (7,588 | ) | 846 | (162 | ) | (10 | ) | (15,387 | ) | |||||||||||||||
Depreciation, depletion and amortization |
41,745 | 5,182 | 9,889 | 584 | (748 | ) | 865 | 57,517 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production costs applicable to sales, including depreciation, depletion and amortization (U.S. GAAP) |
$ | 79,514 | $ | 19,308 | $ | 22,734 | $ | 5,925 | $ | 3,001 | $ | 4,138 | $ | 134,620 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production of silver (ounces) |
2,370,536 | 1,741,578 | | 333,432 | 101,122 | 214,613 | 4,761,281 | |||||||||||||||||||||
Cash operating cost per silver ounce |
$ | (3.68 | ) | $ | 8.73 | $ | | $ | 4.34 | $ | 38.79 | $ | 20.04 | $ | 3.39 | |||||||||||||
Cash costs per silver ounce |
$ | (3.68 | ) | $ | 10.32 | $ | | $ | 6.88 | $ | 40.47 | $ | 20.04 | $ | 4.19 | |||||||||||||
Production of gold (ounces) |
| | 25,758 | | | | 25,758 | |||||||||||||||||||||
Cash operating cost per gold ounce |
$ | | $ | | $ | 924 | $ | | $ | | $ | | $ | 924 | ||||||||||||||
Cash cost per gold ounce |
$ | | $ | | $ | 924 | $ | | $ | | $ | | $ | 924 |
Table 34:
Reconciliation of Non-U.S. GAAP Cash Costs to U.S. GAAP Production Costs
Three months ended March 31, 2012
(In thousands except ounces and per ounce costs) | Palmarejo | San Bartolomé |
Kensington | Rochester | Martha | Endeavor | Total | |||||||||||||||||||||
Total cash operating cost (Non-U.S. GAAP) |
$ | (5,643 | ) | $ | 16,253 | $ | 20,168 | $ | 10,303 | $ | 5,708 | $ | 4,127 | $ | 50,916 | |||||||||||||
Royalties |
| 2,036 | | 609 | 82 | | 2,727 | |||||||||||||||||||||
Production taxes |
| | | 12 | | | 12 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total cash costs (Non-U.S. GAAP) |
$ | (5,643 | ) | $ | 18,289 | $ | 20,168 | $ | 10,924 | $ | 5,790 | $ | 4,127 | $ | 53,655 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Add/Subtract: |
||||||||||||||||||||||||||||
Third party smelting costs |
| | (1,083 | ) | | (1,975 | ) | (788 | ) | (3,846 | ) | |||||||||||||||||
By-product credit |
52,526 | | | 8,957 | 141 | | 61,624 | |||||||||||||||||||||
Other adjustments |
244 | (194 | ) | 7 | 87 | 57 | | 201 | ||||||||||||||||||||
Change in inventory |
(1,268 | ) | (4,487 | ) | (2,001 | ) | (10,403 | ) | (320 | ) | (601 | ) | (19,080 | ) | ||||||||||||||
Depreciation, depletion and amortization |
37,761 | 4,219 | 6,604 | 1,642 | 520 | 1,644 | 52,390 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production costs applicable to sales, including depreciation, depletion and amortization (U.S. GAAP) |
$ | 83,620 | $ | 17,827 | $ | 23,695 | $ | 11,207 | $ | 4,213 | $ | 4,382 | $ | 144,944 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production of silver (ounces) |
2,482,814 | 1,591,292 | | 441,337 | 122,793 | 247,958 | 4,886,194 | |||||||||||||||||||||
Cash operating cost per silver ounce |
$ | (2.27 | ) | $ | 10.21 | $ | | $ | 23.35 | $ | 46.48 | $ | 16.64 | $ | 6.29 | |||||||||||||
Cash costs per silver ounce |
$ | (2.27 | ) | $ | 11.49 | $ | | $ | 24.75 | $ | 47.15 | $ | 16.64 | $ | 6.85 | |||||||||||||
Production of gold (ounces) |
| | 7,444 | | | | 7,444 | |||||||||||||||||||||
Cash operating cost per gold ounce |
$ | | $ | | $ | 2,709 | $ | | $ | | $ | | $ | 2,709 | ||||||||||||||
Cash cost per gold ounce |
$ | | $ | | $ | 2,709 | $ | | $ | | $ | | $ | 2,709 |
23
Table 35:
Reconciliation of Non-U.S. GAAP Cash Costs to U.S. GAAP Production Costs
Six months ended June 30, 2011
(In thousands except ounces and per ounce costs) | Palmarejo | San Bartolomé |
Kensington | Rochester | Martha | Endeavor | Total | |||||||||||||||||||||
Total cash operating cost (Non-U.S. GAAP) |
$ | (407 | ) | $ | 30,825 | $ | 47,199 | $ | 4,875 | $ | 8,322 | $ | 6,859 | $ | 97,673 | |||||||||||||
Royalties |
| 5,064 | | 908 | 353 | | 6,325 | |||||||||||||||||||||
Production taxes |
| | | 468 | | | 468 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total cash costs (Non-U.S. GAAP) |
$ | (407 | ) | $ | 35,889 | $ | 47,199 | $ | 6,251 | $ | 8,675 | $ | 6,859 | $ | 104,466 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Add/Subtract: |
||||||||||||||||||||||||||||
Third party smelting costs |
| | (6,025 | ) | | (1,799 | ) | (1,581 | ) | (9,405 | ) | |||||||||||||||||
By-product credit |
88,656 | | | 4,121 | 508 | | 93,285 | |||||||||||||||||||||
Other adjustments |
773 | 188 | 19 | 138 | 172 | | 1,290 | |||||||||||||||||||||
Change in inventory |
(13,884 | ) | (7,833 | ) | 4,572 | 2,188 | (4,196 | ) | (905 | ) | (20,058 | ) | ||||||||||||||||
Depreciation, depletion and amortization |
75,411 | 10,325 | 19,254 | 1,098 | (157 | ) | 1,483 | 107,414 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production costs applicable to sales, including depreciation, depletion and amortization (U.S. GAAP) |
$ | 150,549 | $ | 38,569 | $ | 65,019 | $ | 13,796 | $ | 3,203 | $ | 5,856 | $ | 276,992 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Production of silver (ounces) |
4,100,303 | 3,452,525 | | 667,127 | 281,107 | 363,795 | 8,864,857 | |||||||||||||||||||||
Cash operating cost per silver ounce |
$ | (0.10 | ) | $ | 8.93 | $ | | $ | 7.31 | $ | 29.60 | $ | 18.85 | $ | 5.69 | |||||||||||||
Cash costs per silver ounce |
$ | (0.10 | ) | $ | 10.40 | $ | | $ | 9.37 | $ | 30.86 | $ | 18.85 | $ | 6.46 | |||||||||||||
Production of gold (ounces) |
| | 49,434 | | | | 49,434 | |||||||||||||||||||||
Cash operating cost per gold ounce |
$ | | $ | | $ | 955 | $ | | $ | | $ | | $ | 955 | ||||||||||||||
Cash cost per gold ounce |
$ | | $ | | $ | 955 | $ | | $ | | $ | | $ | 955 |
24