HIGHLIGHTS:
- The Company reported higher production volumes in the first
quarter of 2015 at its Mountain Pass, California rare earth
facility of 1,479 metric tons ("mt") of rare earth oxide ("REO")
equivalent. This was an 11% increase over the fourth quarter 2014
production of 1,328 mt.
- The Company reported first quarter 2015 product sales volume of
3,436 mt on a consolidated basis, a 9% increase over the fourth
quarter of 2014. The Company achieved an average selling price
("ASP") of $30.97 per kilogram in the first quarter of 2015, versus
an ASP of $36.91 in the preceding quarter, a 16% decline.
- Net revenues for the quarter were $106 million, an 8% decrease
from the fourth quarter of 2014.
- The Company reported a net loss of $0.42 per share for the
quarter. The Company also reported a net loss of $0.28 per share
for the quarter on an adjusted non-GAAP basis, which compares to an
adjusted non-GAAP loss of $0.39 in the fourth quarter of 2014.
- The Company was selected by Siemens AG to supply rare earths
over the next 10 years for high-power, sintered rare earth
permanent magnets used in Siemens' wind turbine generators.
Molycorp, Inc. (NYSE:MCP) ("Molycorp" or the "Company") today
announced financial and operating results for the first quarter of
2015.
FIRST QUARTER 2015 RESULTS
The Company reported consolidated net revenues of $106 million,
an 8% decrease over the fourth quarter of 2014. The decrease in
revenues was largely driven by a shifting product mix and softened
pricing for rare earths, offset in part by increased volume.
During the first quarter of 2015, the Company sold 3,436 mt of
product at an ASP of $30.97 per kilogram, generating a gross loss
of $25 million. This compares to sales volumes of 3,149 mt at an
ASP of $36.91 per kilogram and a gross loss of $45 million during
the fourth quarter of 2014.
Molycorp reported a loss attributable to common stockholders of
$102 million for the quarter, or $0.42 per share. An adjusted loss
per share of $0.28 in the quarter does not reflect charges for
impairment of inventory at Mountain Pass, out-of-ordinary business
expenses, and certain other non-cash items.
The Company reported negative cash flows from operating
activities of $73 million during the first quarter of 2015, and had
$134 million in cash and cash equivalents as of March 31, 2015.
During the three months ended March 31, 2015, Molycorp's capital
expenditures were $6 million on a cash basis.
NON-GAAP ADJUSTED NET LOSS, OIBDA and ADJUSTED
OIBDA
Adjusted Net Loss excludes certain non-cash items and other
out-of-ordinary business expense and operational expansion items.
The Company defines OIBDA as operating income before depreciation,
amortization and accretion. Adjusted OIBDA consists of OIBDA
excluding certain non-cash items and other out-of-ordinary business
expense and operational expansion items. Adjusted Net Loss, OIBDA,
and Adjusted OIBDA are all non-GAAP financial measures. There have
been no changes in the calculation method of previously disclosed
non-GAAP financial measures. The Company's management believes
adjusting out these items from Net Loss and OIBDA, including but
not limited to purchase accounting adjustments, stock-based
compensation, out-of-ordinary expenses/income, asset impairment
charges, and other miscellaneous charges, is useful to investors
because it provides an overall understanding of the Company's
historical financial performance and future prospects. Management
believes that Adjusted Net Loss, OIBDA, and Adjusted OIBDA are an
indication of the Company's base-line performance. Exclusion of
these items permits evaluation and comparison of results for the
Company's core business operations, and it is on this basis that
management internally assesses the Company's performance.
FINANCIAL STATEMENTS AND SUPPLEMENTARY TABLES
TABLE 1: BALANCE SHEETS
MOLYCORP,
INC. |
Condensed Consolidated Balance
Sheets (Unaudited) |
(In thousands, except shares
and per share amounts) |
|
March 31, 2015 |
December 31,
2014 |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 133,599 |
$ 211,685 |
Trade accounts receivable,
net |
47,697 |
44,575 |
Inventory |
180,810 |
169,323 |
Prepaid expenses and other
current assets |
36,013 |
29,332 |
Total current assets |
398,119 |
454,915 |
Non-current assets: |
|
|
Deposits |
31,213 |
31,078 |
Property, plant and equipment,
net |
1,691,051 |
1,707,970 |
Inventory |
24,724 |
25,127 |
Intangible assets, net |
211,726 |
215,871 |
Investments |
7,793 |
8,801 |
Goodwill |
102,808 |
102,808 |
Other non-current assets |
27,350 |
29,416 |
Total non-current assets |
2,096,665 |
2,121,071 |
Total
assets |
$ 2,494,784 |
$ 2,575,986 |
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current liabilities: |
|
|
Trade accounts payable |
$ 35,102 |
$ 40,842 |
Accrued expenses |
30,718 |
33,666 |
Interest payable |
28,184 |
18,300 |
Debt and capital lease
obligations |
13,953 |
12,560 |
Other current liabilities |
5,691 |
4,686 |
Total current liabilities |
113,648 |
110,054 |
Non-current liabilities: |
|
|
Asset retirement
obligation |
17,876 |
17,799 |
Deferred tax liabilities |
63,731 |
63,802 |
Debt and capital lease
obligations |
1,570,801 |
1,559,781 |
Other non-current
liabilities |
20,140 |
20,247 |
Total non-current
liabilities |
1,672,548 |
1,661,629 |
Total
liabilities |
$ 1,786,196 |
$ 1,771,683 |
|
|
|
Stockholders' equity: |
|
|
Common stock, $0.001 par value;
700,000,000 shares authorized at March 31, 2015 and December
31, 2014 |
278 |
260 |
Additional paid-in capital |
2,247,199 |
2,245,478 |
Accumulated other comprehensive
loss |
1,466 |
(3,323) |
Accumulated deficit |
(1,547,742) |
(1,445,408) |
Total Molycorp stockholders'
equity |
701,201 |
797,007 |
Noncontrolling interests |
7,387 |
7,296 |
Total stockholders' equity |
708,588 |
804,303 |
Total liabilities and
stockholders' equity |
$ 2,494,784 |
$ 2,575,986 |
TABLE 2: INCOME STATEMENTS AND EARNINGS PER
SHARE
MOLYCORP,
INC. |
Condensed Consolidated
Statements of Operations (Unaudited) |
(In thousands, except shares
and per share amounts) |
|
|
|
|
|
First Quarter |
Fourth Quarter |
First Quarter |
|
2015 |
2014 |
2014 |
Revenues |
$ 106,424 |
$ 116,242 |
$ 118,526 |
Costs of sales: |
|
|
|
Costs excluding depreciation
and amortization |
(105,874) |
(122,912) |
(125,473) |
Depreciation and
amortization |
(25,280) |
(38,174) |
(16,147) |
Gross loss |
(24,730) |
(44,844) |
(23,094) |
Operating expenses: |
|
|
|
Selling, general and
administrative |
(21,457) |
(14,204) |
(17,956) |
Depreciation, amortization and
accretion |
(5,573) |
(7,327) |
(7,201) |
Research and development |
(3,141) |
(3,662) |
(2,766) |
Impairment of goodwill and
other long-lived assets |
— |
(231,650) |
— |
Operating loss |
(54,901) |
(301,687) |
(51,017) |
|
|
|
|
Other income (expense) |
2,123 |
(6,399) |
474 |
Interest expense, net of capitalized
interest |
(46,300) |
(55,008) |
(35,639) |
Gain on extinguishment of convertible notes,
net |
— |
19,719 |
— |
Loss before income taxes and
equity earnings |
(99,078) |
(343,375) |
(86,182) |
Income tax (expense)
benefit |
(2,968) |
16,832 |
1,907 |
Equity in loss of
affiliates |
(224) |
(21,395) |
(1,723) |
Net loss |
(102,270) |
(347,938) |
(85,998) |
Net (income) loss attributable
to noncontrolling interests |
(64) |
18,142 |
(63) |
Net loss attributable to Molycorp
stockholders |
$ (102,334) |
$ (329,796) |
$ (86,061) |
|
|
|
|
Earnings per share of common stock: |
|
|
|
Net loss attributable to
Molycorp stockholders |
$ (102,334) |
$ (329,796) |
$ (86,061) |
Dividends on Convertible
Preferred Stock |
— |
— |
(2,846) |
Loss attributable to common
stockholders |
$ (102,334) |
$ (329,796) |
$ (88,907) |
|
|
|
|
Weighted average common shares
outstanding—basic |
245,808,011 |
229,960,050 |
221,374,589 |
Basic loss per share: |
$ (0.42) |
$ (1.43) |
$ (0.40) |
|
|
|
|
Weighted average common shares
outstanding—diluted |
245,808,011 |
229,960,050 |
221,374,589 |
Diluted loss per share: |
$ (0.42) |
$ (1.43) |
$ (0.40) |
TABLE 3: STATEMENTS OF CASH FLOWS
MOLYCORP,
INC |
Consolidated Statements of Cash
Flows (Unaudited) |
(In thousands) |
|
|
|
|
Three Months
Ended March 31, |
|
2015 |
2014 |
Cash flows from operating activities: |
|
|
Net loss |
$ (102,270) |
$ (85,998) |
Adjustments to reconcile net loss to net cash
from operating activities: |
|
|
Depreciation, amortization and
accretion |
30,853 |
23,348 |
Deferred income tax (benefit)
expense |
231 |
(6,097) |
Inventory write-downs |
28,868 |
17,371 |
Stock-based compensation |
1,503 |
822 |
Equity in results of
affiliates |
224 |
1,723 |
PIK interest |
3,106 |
— |
Other operating
adjustments |
3,963 |
831 |
Net change in operating assets
and liabilities |
(39,363) |
2,215 |
Net cash used in operating
activities |
(72,885) |
(45,785) |
Cash flows from investing activities: |
|
|
Capital expenditures |
(6,333) |
(29,752) |
Other investing activities |
947 |
493 |
Net cash used in investing
activities |
(5,386) |
(29,259) |
Cash flows from financing activities: |
|
|
Repayments of debt |
979 |
(489) |
Payments of preferred
dividends |
— |
(2,846) |
Dividend paid to noncontrolling
interests |
(40) |
(435) |
Other financing activities |
(781) |
1,323 |
Net cash used in financing
activities |
158 |
(2,447) |
Effect of exchange rate changes
on cash |
27 |
(776) |
Net change in cash and cash
equivalents |
(78,086) |
(78,267) |
Cash and cash equivalents at beginning of the
period |
211,685 |
314,317 |
Cash and cash equivalents at end of
period |
$ 133,599 |
$ 236,050 |
TABLE 4: SEGMENT INFORMATION
|
|
|
Magnetic |
|
|
|
Total |
|
|
Chemicals |
Materials |
|
Corporate |
|
Molycorp, |
Three months ended March 31,
2015 |
Resources |
and Oxides |
and Alloys |
Rare Metals |
and other |
Eliminations |
Inc. |
|
(In
thousands) |
Revenues: |
|
|
|
|
|
|
|
External |
$ 2,514 |
$ 37,288 |
$ 50,508 |
$ 16,114 |
|
$ — |
$ 106,424 |
Inter-segment |
8,315 |
5,508 |
1,616 |
15 |
|
(15,454) |
— |
Total revenues |
$ 10,829 |
$ 42,796 |
$ 52,124 |
$ 16,129 |
|
$ (15,454) |
$ 106,424 |
OIBDA |
$ (34,848) |
$ 5,737 |
$ 12,247 |
$ 1,594 |
|
|
|
Depreciation, amortization and accretion |
(21,954) |
(2,283) |
(4,156) |
(2,405) |
|
|
|
Operating (loss) income |
$ (56,802) |
$ 3,454 |
$ 8,091 |
$ (811) |
$ (12,079) |
$ 3,246 |
$ (54,901) |
Other expense |
|
|
|
|
|
|
2,123 |
Interest expense |
|
|
|
|
|
|
(46,300) |
Loss before income taxes and equity
earnings |
|
|
|
|
|
|
$ (99,078) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Magnetic |
|
|
|
Total |
|
|
Chemicals |
Materials |
|
Corporate |
|
Molycorp, |
Quarter ended December 31,
2014 |
Resources |
and Oxides |
and Alloys |
Rare Metals |
and other |
Eliminations |
Inc. |
|
(In
thousands) |
Revenues: |
|
|
|
|
|
|
|
External |
$ 4,145 |
$ 36,844 |
$ 53,535 |
$ 21,718 |
|
$ — |
$ 116,242 |
Inter-segment |
4,510 |
5,918 |
3,865 |
— |
|
(14,293) |
— |
Total revenues |
$ 8,655 |
$ 42,762 |
$ 57,400 |
$ 21,718 |
|
$ (14,293) |
$ 116,242 |
OIBDA |
(48,327) |
(214,975) |
13,762 |
(1,706) |
|
|
|
Depreciation, amortization and accretion |
(31,307) |
(5,797) |
(4,226) |
(4,116) |
|
|
|
Operating (loss) income |
$ (79,634) |
$ (220,772) |
$ 9,536 |
$ (5,822) |
$ (7,936) |
$ 2,941 |
$ (301,687) |
Other expense |
|
|
|
|
|
|
(3,615) |
Foreign exchange loss, net |
|
|
|
|
|
|
(2,784) |
Interest expense, net of capitalized
interest |
|
|
|
|
|
|
(55,008) |
Gain on extinguishment of convertible notes,
net |
|
|
|
|
|
|
19,719 |
Loss before income taxes and equity
earnings |
|
|
|
|
|
|
$ (343,375) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Magnetic |
|
|
|
Total |
|
|
Chemicals |
Materials |
|
Corporate |
|
Molycorp, |
Three months ended March 31,
2014 |
Resources |
and Oxides |
and Alloys |
Rare Metals |
and other |
Eliminations |
Inc. |
|
(In
thousands) |
Revenues: |
|
|
|
|
|
|
|
External |
$ 3,111 |
$ 40,271 |
$ 54,720 |
$ 20,424 |
|
$ — |
$ 118,526 |
Inter-segment |
12,453 |
6,285 |
1,218 |
— |
|
(19,956) |
— |
Total revenues |
$ 15,564 |
$ 46,556 |
$ 55,938 |
$ 20,424 |
|
$ (19,956) |
$ 118,526 |
OIBDA |
$ (36,445) |
$ 3,299 |
$ 13,676 |
$ (70) |
|
|
|
Depreciation, amortization and accretion |
(13,091) |
(3,872) |
(4,237) |
(2,093) |
|
|
|
Operating (loss) income |
$ (49,536) |
$ (573) |
$ 9,439 |
$ (2,163) |
$ (7,109) |
$ (1,075) |
$ (51,017) |
Other expense |
|
|
|
|
|
|
474 |
Interest expense |
|
|
|
|
|
|
(35,639) |
Loss before income taxes and equity
earnings |
|
|
|
|
|
|
$ (86,182) |
TABLE 5: PRODUCT REVENUES, SALES VOLUME,
ASP
|
First Quarter |
Fourth Quarter |
First Quarter |
Revenues (in
thousands) |
2015 |
2014 |
2014 |
Resources (1) |
$ 10,829 |
$ 8,655 |
$ 15,564 |
Chemicals and Oxides (2) |
42,796 |
42,762 |
46,556 |
Magnetic Materials and Alloys (3) |
52,124 |
57,400 |
55,938 |
Rare Metals (4) |
16,129 |
21,718 |
20,424 |
Inter-segment eliminations |
(15,454) |
(14,293) |
(19,956) |
Total Net Revenues |
$ 106,424 |
$ 116,242 |
$ 118,526 |
|
|
|
|
Sales volume (in metric
tons) |
|
|
|
Resources |
1,269 |
898 |
988 |
Chemicals and Oxides |
1,800 |
1,446 |
1,926 |
Magnetic Materials and Alloys (a) |
1,444 |
1,440 |
1,374 |
Rare Metals |
92 |
126 |
101 |
Inter-segment eliminations |
(1,169) |
(761) |
(871) |
(a) Includes magnetic powders and rare earth
alloys. |
|
|
|
|
|
|
|
ASP per kilogram |
|
|
|
Resources |
$ 8.56 |
$ 9.64 |
$ 15.75 |
Chemicals and Oxides |
23.78 |
29.57 |
24.17 |
Magnetic Materials and Alloys |
36.10 |
39.86 |
40.71 |
Rare Metals |
175.29 |
172.38 |
202.21 |
|
|
|
|
1. The Resources segment includes
operations at our Mountain Pass facility where we conduct rare
earth minerals extraction and processing to produce: purified
unseparated light rare earth concentrates, or LREC; separated rare
earth oxides, including lanthanum, cerium and
neodymium/praseodymium; heavy rare earth concentrates, which
include samarium, europium, gadolinium, terbium, dysprosium and
others; and a line of proprietary rare earth-based water treatment
products, including SorbX® and PhosFIX®. |
2. The Chemicals and Oxides
segment includes: production of rare earths at our operations at
Molycorp Silmet; separated heavy rare earth oxides and other
custom engineered materials from our facilities in Jiangyin,
Jiangsu Province, China; and production of rare earths, salts of
REEs, zirconium-based engineered materials and mixed rare
earth/zirconium oxides from our facilities in Zibo, Shandong
Province, China. Rare earths and zirconium applications from
products made in this segment include catalytic converters,
computers, television display panels, optical lenses, mobile
phones, electronic chips, and many others. |
3. The Magnetic Materials and
Alloys segment includes the production of Neo Powders™ through our
wholly-owned manufacturing facilities in Tianjin, China, and Korat,
Thailand, under the Molycorp Magnequench brand. This operating
segment also includes manufacturing of neodymium and samarium
magnet alloys, other specialty alloy products and rare earth metals
at our MMA facility in Tolleson, Arizona. Neo Powders™ are used in
the production of high performance, bonded NdFeB permanent magnets,
which are found in micro-motors, precision motors, sensors, and
other applications requiring high levels of magnetic strength,
flexibility, small size, reduced weight, and energy efficient
performance. |
4. The Rare Metals segment
produces, reclaims, refines and markets high value niche metals and
their compounds that include gallium, indium, rhenium, tantalum,
and niobium. Operations in this segment are distributed in several
locations: Quapaw, Oklahoma; Blanding, Utah; Peterborough, Ontario,
Canada; Sagard, Germany; Hyeongok Industrial Zone in South Korea;
and Sillamäe, Estonia. Applications from products made in this
segment include wireless technologies, LEDs, flat panel displays,
turbines, solar power catalysts, steel additives, electronics
applications, and many others. |
TABLE 6: NON-GAAP ADJUSTED NET LOSS, OIBDA and ADJUSTED
OIBDA RECONCILIATION
(In thousands, except shares
and per share data) |
|
|
|
|
Adjusted Net Loss |
|
|
|
|
First Quarter |
Fourth Quarter |
First Quarter |
|
2015 |
2014 |
2014 |
Net loss attributable to Molycorp
stockholders |
$ (102,334) |
$ (329,795) |
$ (86,061) |
Certain non-cash and other items: |
|
|
|
Stock-based compensation |
1,503 |
1,476 |
822 |
Inventory write-downs (Mountain
Pass) |
27,640 |
26,803 |
15,693 |
Impact of purchase accounting
on cost of inventory sold |
— |
252 |
577 |
Impairment of goodwill and
other long-lived assets |
— |
231,356 |
— |
Write-down of investments and
related receivables |
— |
22,986 |
— |
Gain on debt conversion |
— |
(21,683) |
— |
Out-of-ordinary items: |
|
|
|
Water removal costs |
3,352 |
551 |
8,102 |
Income tax effect of above adjustments |
(12) |
(20,972) |
(160) |
Adjusted net loss |
(69,851) |
(89,026) |
(61,027) |
Dividends on Convertible Preferred Stock |
— |
— |
(2,846) |
Adjusted net loss attributed to common
stockholders |
$ (69,851) |
$ (89,026) |
$ (63,873) |
Weighted average common shares
outstanding |
245,808,011 |
229,960,050 |
221,374,589 |
Adjusted net loss per share |
$ (0.28) |
$ (0.39) |
$ (0.29) |
|
|
|
|
OIBDA and Adjusted
OIBDA |
|
|
|
|
First Quarter |
Fourth Quarter |
First Quarter |
Consolidated |
2015 |
2014 |
2014 |
Operating loss |
$ (54,901) |
$ (301,687) |
$ (51,017) |
Depreciation and amortization
included in costs of sales |
25,280 |
38,174 |
16,147 |
Depreciation, amortization and
accretion |
5,573 |
7,327 |
7,201 |
OIBDA |
(24,048) |
(256,186) |
(27,669) |
|
|
|
|
Adjusted OIBDA by
Segment |
|
|
|
Resources |
|
|
|
OIBDA |
$ (34,848) |
$ (48,327) |
$ (36,445) |
Stock-based compensation |
235 |
180 |
234 |
Inventory write-downs |
27,640 |
26,803 |
15,693 |
Impairment of long-lived
assets |
— |
13,567 |
— |
Water removal costs |
3,352 |
551 |
8,102 |
Adjusted OIBDA -
Resources |
$ (3,621) |
$ (7,226) |
$ (12,416) |
Chemicals and Oxides |
|
|
|
OIBDA |
$ 5,737 |
$ (214,975) |
$ 3,299 |
Stock-based compensation |
207 |
223 |
193 |
Impact of purchase accounting
on cost of inventory sold |
— |
252 |
25 |
Impairment of goodwill and
other long-lived assets |
— |
215,567 |
— |
Adjusted OIBDA -
Chemicals and Oxides |
$ 5,944 |
$ 1,067 |
$ 3,517 |
Magnetic Materials and
Alloys |
|
|
|
OIBDA |
$ 12,247 |
$ 13,762 |
$ 13,676 |
Stock-based compensation |
165 |
168 |
144 |
Impact of purchase accounting
on cost of inventory sold |
— |
— |
(45) |
Impairment of long-lived
assets |
— |
144 |
— |
Adjusted OIBDA -
Magnetic Materials and Alloys |
$ 12,412 |
$ 14,074 |
$ 13,775 |
Rare Metals |
|
|
|
OIBDA |
$ 1,594 |
$ (1,706) |
$ (70) |
Stock-based compensation |
40 |
28 |
22 |
Impact of purchase accounting
on cost of inventory sold |
— |
— |
598 |
Impairment of goodwill and
other long-lived assets |
— |
2,077 |
— |
Adjusted OIBDA - Rare
Metals |
1,634 |
399 |
550 |
Corporate and other |
(11,168) |
(7,004) |
(6,823) |
Eliminations |
3,246 |
2,941 |
(1,075) |
Adjusted OIBDA -
Consolidated |
$ 8,447 |
$ 4,251 |
$ (2,472) |
ABOUT MOLYCORP
Molycorp is the only advanced material manufacturer in the world
that both controls a world-class rare earth resource and can
produce high-purity, custom engineered rare earth products to meet
increasingly demanding customer specifications. A globally
integrated manufacturer, the Company produces a wide variety of
specialized products from 13 different rare earths (lights and
heavies), five rare metals (gallium, indium, rhenium, tantalum and
niobium), and the transition metals yttrium and zirconium. With 26
locations across 11 countries, Molycorp also produces rare earth
magnetic materials through its Molycorp Magnequench subsidiary,
including neodymium-iron-boron ("NdFeB") magnet powders, used to
manufacture bonded NdFeB permanent rare earth magnets. Through its
joint venture with Daido Steel and the Mitsubishi Corporation,
Molycorp manufactures next-generation, sintered NdFeB permanent
rare earth magnets. Through its Molycorp Advanced Water
Technologies subsidiary, the Company markets and sells its
proprietary, cerium-based advanced water purification technology
called SorbX® for use in municipal and industrial wastewater
treatment, recreational water, and pool and spa water treatment
markets. For more information please visit
http://www.molycorp.com.
SAFE HARBOR STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This release contains forward-looking statements that represent
Molycorp's beliefs, projections and predictions about future events
or Molycorp's future performance. Forward-looking statements can be
identified by terminology such as "may," "will," "would," "could,"
"should," "expect," "intend," "plan," "anticipate," "believe,"
"estimate," "predict," "potential," "continue" or the negative of
these terms or other similar expressions or phrases. These
forward-looking statements are necessarily subjective and involve
known and unknown risks, uncertainties and other important factors
that could cause Molycorp's actual results, performance or
achievements or industry results to differ materially from any
future results, performance or achievement described in or implied
by such statements.
Factors that may cause actual results to differ materially from
expected results described in forward-looking statements include,
but are not limited to: Molycorp's ability meet the standards
necessary to maintain its listing on the New York Stock Exchange or
other stock exchange, including its ability to cure any
non-compliance with such listing standards; the need to secure
additional capital to implement Molycorp's business plans, and
Molycorp's ability to successfully secure any such capital,
including the ability to successfully access the remaining
commitment under the financings with certain funds managed by
Oaktree Capital Management, L.P.; Molycorp's ability to make
interest payments on its existing debt; Molycorp's ability to repay
its debt, whether at maturity, pursuant to any acceleration, or
otherwise; Molycorp's ability to optimize and ramp up production at
its Mountain Pass rare earth mine and processing facility, which we
refer to as the Mountain Pass facility, and the ability to develop
internal and external demand for REO and other downstream products,
including the ability to operate at commercial production rates and
competitive cash production costs, in each case within the
projected time frame; Molycorp's ability to economically
produce chemical reagents from waste water at the Mountain Pass
facility on a consistent basis; the success of Molycorp's cost
mitigation efforts in connection with the optimization and ramp up
of the Mountain Pass facility, which, if unsuccessful, might cause
its costs to exceed budget; the final costs of Molycorp's planned
capital projects, which may differ from estimated costs; Molycorp's
ability to achieve fully the strategic and financial objectives
related to its acquisitions, including in respect of Molycorp's
financial condition and results of operations; risks and
uncertainties associated with intangible assets, including any
future goodwill impairment charges and the ability to develop and
protect intellectual property related to products and operations;
risks associated with Molycorp's ability to protect its
intellectual property, including the infringement of intellectual
property of third parties; market conditions, including prices and
demand for Molycorp's products; Molycorp's ability to control its
working capital needs; foreign exchange rate fluctuations; the
development and commercialization of new products; unexpected
actions of domestic and foreign governments; various events which
could disrupt operations, including natural events and other risks;
uncertainties associated with Molycorp's reserve estimates and
non-reserve deposit information, including estimated mine life and
annual production; uncertainties related to feasibility studies
that provide estimates of expected or anticipated costs,
expenditures and economic returns, REO prices, production costs and
other expenses for operations, which are subject to fluctuation;
uncertainties regarding global supply and demand for rare earths
materials; uncertainties regarding the results of Molycorp's
exploration programs; Molycorp's ability to enter into definitive
agreements with its customers, its ability to supply such
customers, and its ability to maintain customer relationships;
Molycorp's ability to maintain appropriate relations with unions
and employees; Molycorp's ability to attract and retain employees
with the necessary experience, skills and training; Molycorp's
ability to successfully implement its vertical integration
strategy; environmental laws, regulations and permits affecting
Molycorp's business, directly and indirectly, including, among
others, those relating to mine reclamation and restoration, climate
change, emissions to the air and water and human exposure to
hazardous substances used, released or disposed of by Molycorp; and
uncertainties associated with unanticipated geological conditions
related to mining; and the outcome of the current stockholder class
action litigation and derivative litigation, including any actions
taken by government agencies in connection therewith.
For more information regarding these and other risks and
uncertainties that Molycorp may face, see the section entitled
"Risk Factors" of the Company's Annual Report on Form 10-K for the
year ended December 31, 2014 and of the Company's Quarterly Reports
on Form 10-Q. Any forward-looking statement contained in this
release or the Annual Report on Form 10-K or the Quarterly Reports
on Form 10-Q reflects Molycorp's current views with respect to
future events and is subject to these and other risks,
uncertainties and assumptions relating to Molycorp's operations,
operating results, growth strategy and liquidity. You should not
place undue reliance on these forward-looking statements because
such statements speak only as to the date when made. Molycorp
assumes no obligation to publicly update or revise these
forward-looking statements for any reason, or to update the reasons
actual results could differ materially from those anticipated in
these forward-looking statements, even if new information becomes
available in the future, except as otherwise required by applicable
law.
CONTACT: FOR MORE INFORMATION:
Company Contacts:
Jim Sims, +1 (303) 843-8062
Vice President Corporate Communications
jim.sims@molycorp.com
Brian Blackman, +1 (303) 843-8067
Vice President Investor Relations
brian.blackman@molycorp.com
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