Reduces Full-Year Companywide Cost Guidance
Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE: CDE)
reported third quarter 2016 revenue of $176.2 million, net income
of $69.6 million, or $0.42 per share, and adjusted net income1 of
$38.6 million, or $0.23 per share.
Cash flow from operating activities was $47.8 million, a 4%
quarter-over-quarter increase. Free cash flow1 totaled $14.6
million in the third quarter, 20% higher than the second
quarter.
The Company raised its 2016 full-year production guidance on
October 6 and is now reducing its full-year cost guidance at three
of its five operations as outlined in the Full-Year 2016 Outlook
section of this release.
Highlights
- Silver and gold production were 3.5
million ounces and 84,871 ounces, respectively, or 8.6 million
silver equivalent ounces1, representing a 10% decrease over the
second quarter
- Silver and gold sales were 3.4 million
ounces and 83,389 ounces, respectively, or 8.4 million silver
equivalent ounces1, representing a 10% decrease over the second
quarter
- Average realized prices per ounce of
silver and gold were $19.61 and $1,317, respectively, representing
increases of 13% and 5%, respectively, compared to the prior
quarter
- For Coeur's primary silver operations,
CAS and adjusted CAS were $11.96 and $11.69, respectively, per
realized AgEqOz1. Using a 60:1 equivalence ratio, CAS and adjusted
CAS were $12.38 and $12.10 per AgEqOz1
- For Coeur's primary gold operations,
CAS and adjusted CAS per AuEqOz1 were $767 and $712,
respectively
- Companywide AISC and adjusted AISC were
$15.89 and $15.37 per realized AgEqOz1, respectively. Using a 60:1
equivalence ratio, companywide AISC and adjusted AISC were $17.02
and $16.46 per AgEqOz1, respectively
- Net income and adjusted net income1
were $69.6 million and $38.6 million, or $0.42 and $0.23 per share,
respectively. Net income increased nearly four times compared to
the second quarter and adjusted net income more than doubled
quarter-over-quarter
- EBITDA1 and adjusted EBITDA1 were $50.9
million and $62.7 million, respectively, with both nearly doubling
compared to the same quarter last year. LTM adjusted EBITDA1 rose
18% quarter-over-quarter to $201.7 million
- Cash and equivalents were $222.5
million at September 30, 2016
- Total debt declined $109.3 million, or
21%, during the quarter. Together with rising adjusted EBITDA1, the
Company's total debt to LTM adjusted EBITDA1 declined to 2.0x,
which is 64% lower than it was a year ago (net debt to LTM adjusted
EBITDA1 is now 0.9x)
- Interest expense declined 26%
quarter-over-quarter and 35% year-over-year
- The minimum ounce obligation on the old
Franco-Nevada royalty was satisfied in July, triggering a shift to
a new gold stream with more favorable terms that are expected to
result in a significant increase in free cash flow1 at Palmarejo
(previously announced June 23, 2014)
- Announced a $200 million
"at-the-market" (ATM) stock offering on September 9, 2016. As of
October 25, the Company sold 7.6 million shares under the offering,
generating net proceeds of approximately $90 million. The Company
intends to use these proceeds to further reduce remaining debt
levels
"We achieved a number of significant milestones during the third
quarter despite lower production relative to the second quarter.
Our quarterly earnings more than doubled, free cash flow increased
20% quarter-over-quarter and LTM adjusted EBITDA has now risen
above $200 million - up from $96 million just 15 months ago.
Importantly, we are well-positioned for a strong fourth quarter at
each of our five operations," said Mitchell J. Krebs, Coeur's
President and Chief Executive Officer.
"We made great progress repositioning our balance sheet to be
conservative, flexible and supportive of the Company's future
growth initiatives. Our total debt declined by 21% since the end of
June, interest expense dropped by 26%, and our total debt to LTM
adjusted EBITDA ratio has now dropped to 2.0x - down 65% from 5.7x
just fifteen months ago. With cash and equivalents of over $220
million and rising due to our positive free cash flow and the
expected completion of our ongoing ATM stock offering, we
anticipate further balance sheet strengthening to take place during
the remainder of this year.
"We increased our full-year 2016 production guidance earlier
this month and are now reducing our full-year 2016 cost guidance,
which reflects the significant operational improvements we have
made over the last several years. As we focus on longer-term growth
in production and cash flow, we are excited about the high-grade
exploration results we are generating from several of our existing
operations and our revitalized earlier-stage exploration
initiatives. In addition, we look forward to conducting
confirmation drilling in early 2017 with the goal of assessing a
lower capex, higher grade, lower tonnage development and operating
plan for our La Preciosa project in Mexico." (See "Non- U.S. GAAP
Measures")
Financial and Operating Highlights
(Unaudited)
(Amounts in millions, except per share amounts, gold ounces
produced & sold, and per-ounce metrics) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Revenue $ 176.2
$ 182.0 $ 148.4 $ 164.2 $ 162.6
Costs Applicable to Sales $ 105.4 $ 100.5 $
101.6 $ 125.3 $ 120.2
General and Administrative Expenses
$ 7.1 $ 7.4 $ 8.3 $ 8.8 $ 6.7
Net Income
(Loss) $ 69.6 $ 14.5 $ (20.4 ) $ (303.0 ) $ (14.2
)
Net Income (Loss) Per Share $ 0.42 $ 0.09 $
(0.14 ) $ (2.28 ) $ (0.11 )
Adjusted Net Income
(Loss)1 $ 38.6 $ 16.9 $ (10.5 ) $ (44.0 )
$ (19.5 )
Adjusted Net Income (Loss)1 Per
Share $ 0.23 $ 0.11 $ (0.06 ) $ (0.31 ) $ (0.14 )
Weighted Average Shares 161.0 157.9 150.2 145.0 135.5
EBITDA1 $ 50.9 $ 62.1 $ 20.8 $ (272.9 )
$ 25.5
Adjusted EBITDA1 $ 62.7 $ 72.0 $
37.4 $ 32.9 $ 33.7
Cash Flow from Operating Activities
$ 47.8 $ 45.9 $ 6.6 $ 43.2 $ 36.8
Capital
Expenditures $ 25.6 $ 23.3 $ 22.2 $ 30.0 $ 23.9
Free Cash Flow1 $ 14.6 $ 12.2 $ (24.7 )
$ 4.2 $ 2.8
Cash, Equivalents & Short-Term Investments
$ 222.5 $ 257.6 $ 173.4 $ 200.7 $ 205.7
Total
Debt2 $ 401.7 $ 511.1 $ 511.1 $ 490.4 $
546.0
Average Realized Price Per Ounce – Silver $
19.61 $ 17.38 $ 15.16 $ 14.27 $ 14.66
Average Realized
Price Per Ounce – Gold $ 1,317 $ 1,255 $ 1,178 $
1,093 $ 1,116
Silver Ounces Produced 3.5 4.0 3.4 4.0
3.8
Gold Ounces Produced 84,871 92,727 78,072 91,551
85,769
Silver Equivalent Ounces Produced1 8.6
9.6 8.1 9.5 9.0
Silver Ounces Sold 3.4 4.0 3.5 4.4
4.0
Gold Ounces Sold 83,389 88,543 79,091 92,032
91,118
Silver Equivalent Ounces Sold1 8.4 9.3
8.3 9.9 9.5
Silver Equivalent Ounces Sold (Realized)1
9.0 10.4 9.7 11.3 10.9
Adjusted CAS per
AgEqOz1 $ 12.10 $ 10.71 $ 12.05 $ 12.65 $
12.07
Adjusted CAS per Realized AgEqOz1 $
11.69 $ 10.05 $ 11.08 $ 11.71 $ 11.00
Adjusted CAS per
AuEqOz1 $ 712 $ 644 $ 721 $ 663 $ 783
Adjusted AISC per AgEqOz1 $ 16.46 $
14.82 $ 16.05 $ 15.66 $ 15.17
Adjusted AISC per Realized
AgEqOz1 $ 15.37 $ 13.27 $ 13.73 $ 13.55 $
13.14
Financial Results
Third quarter revenue decreased 3% quarter-over-quarter and
increased 8% year-over-year to $176.2 million. Average realized
silver and gold prices during the quarter were $19.61 and $1,317,
respectively. Silver contributed 38% of metal sales and gold
contributed 62% during the third quarter. Costs applicable to sales
increased 5% quarter-over-quarter and decreased 12% year-over-year
to $105.4 million.
Third quarter general and administrative expenses were $7.1
million, a 4% quarter-over-quarter decrease and a 6% year-over-year
increase. For the first nine months of 2016, general and
administrative expenses were $22.8 million, a decline of 5% from
the same period in 2015. Third quarter capital expenditures of
$25.6 million were 10% higher quarter-over-quarter and 7% higher
year-over-year, driven by development of the high-grade Jualin
deposit at Kensington and the Guadalupe and Independencia deposits
at Palmarejo. Capital expenditures totaled $71.1 million for the
first nine months of 2016, a 9% increase compared with the same
period in 2015.
Net income was $69.6 million, or $0.42 per share, during the
third quarter, compared to net income of $14.5 million, or $0.09
per share, in the second quarter, and a net loss of $14.2 million,
or $0.11 per share, in the third quarter 2015. Adjusted net income1
was $38.6 million, or $0.23 per share, compared to adjusted net
income1 of $16.9 million, or $0.11 per share, in the second quarter
and a net loss of $19.5 million, or $0.14 per share, in the third
quarter 2015. Adjusted net income for the third quarter primarily
excluded loss on debt extinguishments, gains on the sale of assets,
and various tax effects (including a $40.8 million deferred tax
benefit related to reorganization activities to integrate recent
acquisitions). Third quarter cash flow from operating activities
was $47.8 million, resulting from higher average realized metal
prices and a $10.3 million decrease in working capital.
Third quarter adjusted EBITDA1 was $62.7 million, a decrease of
13% quarter-over-quarter and nearly double the third quarter 2015.
At September 30, LTM adjusted EBITDA1 totaled $201.7 million, an
18% quarter-over-quarter increase and more than double the same
period last year.
Operations
Highlights of third quarter 2016 results for each of the
Company's operating segments are provided below.
Palmarejo, Mexico
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Underground Operations:
Tons mined 253,681
283,971 215,642 189,383 190,399
Average silver grade (oz/t)
3.96 5.40 4.21 3.96 4.11
Average gold grade (oz/t)
0.08 0.08 0.07 0.06 0.10
Surface Operations: Tons
mined — 1,695 35,211 102,018 247,071
Average silver
grade (oz/t) — 7.77 4.18 3.86 3.56
Average gold grade
(oz/t) — 0.07 0.04 0.03 0.03
Processing: Total
tons milled 274,644 270,142 246,533 301,274 427,635
Average recovery rate – Ag 85.5% 89.5% 89.1% 95.4%
87.9%
Average recovery rate – Au 77.7% 86.4% 92.1%
88.8% 84.7%
Silver ounces produced (000's) 933 1,307
933 1,126 1,422
Gold ounces produced 16,608 18,731
14,668 14,326 22,974
Silver equivalent ounces
produced1 (000's) 1,930 2,431 1,813 1,985
2,800
Silver ounces sold (000's) 778 1,350 928 1,465
1,425
Gold ounces sold 11,410 19,214 12,899 18,719
25,000
Silver equivalent ounces sold1 (000's)
1,462 2,502 1,702 2,588 2,925
Silver equivalent ounces
sold1 (realized) (000's) 1,544 2,737 1,930
2,840 3,325
Metal sales $30.7 $48.3 $29.8 $41.6 $49.2
Costs applicable to sales $16.0 $22.9 $21.0 $39.8
$34.1
Adjusted CAS per AgEqOz1 $10.70
$9.02 $11.54 $13.48 $11.40
Adjusted CAS per realized
AgEqOz1 $10.14 $8.24 $10.18 $12.04 $10.01
Exploration expense $1.3 $0.6 $0.8 $0.5 $1.1
Cash
flow from operating activities $13.7 $11.3 $3.4 $20.3
$22.9
Sustaining capital expenditures $6.7 $5.5 $6.6
$(1.4) $1.1
Development capital expenditures $3.3
$3.4 $2.2 $7.0 $9.4
Total capital expenditures $10.0
$8.9 $8.8 $5.6 $10.5
Gold production royalty payments
$7.6 $10.5 $9.1 $9.0 $10.2
Free cash flow1
$(3.9) $(8.1) $(14.5) $5.7 $2.2
- On schedule transition to
lower-tonnage, higher-grade, higher-margin underground operations
with Guadalupe mining nearly 2,300 tons per day during the
quarter
- Development of Independencia remains
on-track to achieve a mining rate of 1,000 tons per day by
year-end
- Silver equivalent1 production decreased
21% quarter-over-quarter mostly due to the planned installation of
improvements to the Merrill-Crowe processing circuits during the
quarter. Process plant recovery rates, grades, and tons mined are
all expected to increase in the fourth quarter
- Metal sales of $30.7 million decreased
36% quarter-over-quarter and 38% year-over-year
- Adjusted CAS per realized AgEqOz1 were
$10.14 and adjusted CAS per AgEqOz1 (60:1 equivalence) were $10.70,
representing increases of 23% and 19%, respectively, compared to
the second quarter due to lower production rates
- The 400,000 ounce minimum royalty
obligation with Franco-Nevada was achieved in July 2016, resulting
in the new, more favorable gold stream agreement becoming
effective, which is expected to significantly improve Palmarejo's
cash flows going forward
- The Company has increased full-year
2016 production guidance to 4.1 - 4.6 million silver ounces from
3.9 - 4.4 million silver ounces and 70,000 - 75,000 gold ounces
from 67,000 - 72,000 gold ounces
- The Company is reducing cost guidance
to $10.50 - $11.00 per AgEqOz1 (60:1 equivalence) or $9.75 - $10.25
per realized AgEqOz1 from $12.50 - $13.50 per AgEqOz1 (60:1
equivalence)
Rochester, Nevada
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Ore tons placed
4,901,039 6,402,013 4,374,459 4,411,590
4,128,868
Average silver grade (oz/t) 0.54
0.54 0.64 0.60 0.59
Average gold grade (oz/t) 0.003
0.003 0.004 0.003 0.003
Silver ounces produced (000's)
1,161 1,197 929 1,107 1,086
Gold ounces produced
12,120 13,940 10,460 11,564 10,892
Silver equivalent
ounces produced1 (000's) 1,888 2,033 1,557
1,800 1,740
Silver ounces sold (000's) 1,163 1,137
1,079 1,125 1,304
Gold ounces sold 11,751 12,909
11,672 11,587 13,537
Silver equivalent ounces sold1
(000's) 1,868 1,912 1,779 1,821 2,116
Silver
equivalent ounces sold1 (realized) (000's)
1,952 2,070 1,986 2,004 2,333
Metal sales
$37.9 $35.8 $30.0 $29.0 $34.6
Costs applicable to
sales $21.8 $21.7 $22.5 $22.8 $25.4
Adjusted CAS
per AgEqOz1 $11.56 $11.30 $12.61 $12.37 $12.01
Adjusted CAS per realized AgEqOz1 $11.07
$10.43 $11.29 $11.19 $10.89
Exploration expense $0.1
$0.2 $0.1 $0.1 $—
Cash flow from operating activities
$9.5 $9.2 $2.1 $0.4 $6.5
Sustaining capital
expenditures $1.2 $2.6 $2.5 $5.3 $1.8
Development
capital expenditures $2.2 $1.3 $0.8 $5.5 $3.5
Total
capital expenditures $3.4 $3.9 $3.3 $10.8 $5.3
Free
cash flow1 $6.1 $5.3 $(1.2) $(10.4) $1.2
- Silver equivalent1 production decreased
7% quarter-over-quarter due to longer-than-expected recovery time
from the Stage III leach pad
- Metal sales of $37.9 million increased
6% quarter-over-quarter and increased 10% year-over-year
- $6.1 million of free cash flow1 was
generated, which represents the highest level of free cash flow
since the first quarter of 2015
- Adjusted CAS per realized AgEqOz1 were
$11.07 and adjusted CAS per AgEqOz1 (60:1 equivalence) were $11.56,
representing increases of 6% and 2%, respectively, compared to the
prior quarter
- Crushing rates remained strong while
tons placed moderated in the third quarter due to fewer run-of-mine
tons placed
- Construction of the Stage IV leach pad
expansion commenced in July 2016 and is expected to be complete in
mid-2017 for a total estimated cost of approximately $40 million
($30 million of which is anticipated to be spent in 2017)
- The Company revised full-year 2016
silver production guidance down to 4.5 - 5.0 million ounces from
4.8 - 5.3 million ounces and is maintaining gold production
guidance of 48,000 - 55,000 ounces
- Full-year 2016 cost guidance remains
unchanged at $11.25 - $12.25 per AgEqOz1 (60:1 equivalence) or
$10.40 - $11.35 per realized AgEqOz1
Kensington, Alaska
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Tons milled 140,322
157,117 159,360 159,666 165,198
Average gold grade (oz/t) 0.20 0.22 0.21 0.22 0.19
Average recovery rate 94.8% 94.1% 95.8% 96.0% 93.9%
Gold ounces produced 26,459 32,210 31,974 33,713
28,799
Gold ounces sold 30,998 30,178 31,648 29,989
28,084
Metal sales $40.2 $36.5 $35.7 $31.7 $30.5
Costs applicable to sales $26.7 $22.6 $24.4 $23.7
$25.0
Adjusted CAS per AuOz1 $859 $740 $761
$777 $842
Exploration expense $1.2 $1.0 $— $0.3 $0.2
Cash flow from operating activities $18.0 $7.7 $13.7
$4.5 $8.9
Sustaining capital expenditures $5.2 $4.3
$4.4 $5.5 $1.0
Development capital expenditures $3.4
$3.2 $3.7 $4.0 $4.5
Total capital expenditures $8.6
$7.5 $8.1 $9.5 $5.5
Free cash flow1 $9.4 $0.2
$5.6 $(5.0) $3.4
- Gold production decreased 18%
quarter-over-quarter due to mill downtime at the end of the quarter
relating to a blocked tailings line. The blockage has been cleared
and the mill has resumed operations at full capacity
- CAS per AuOz1 of $859 increased 16%
compared to the prior quarter due mostly to the mill downtime
experienced during the quarter
- Metal sales of $40.2 million increased
10% quarter-over-quarter and increased 32% year-over-year due to
more ounces sold and higher averaged realized gold prices
- Free cash flow1 of $9.4 million
represents the highest level in two years
- Development of the Jualin decline
continues to advance. Initial production is expected in the second
half of 2017
- The Company has raised the low-end of
full-year 2016 production guidance to 120,000 - 125,000 gold ounces
from 115,000 - 125,000 gold ounces previously and is reducing
full-year 2016 cost guidance to $775 - $825 per AuOz1 from $825 -
$875
Wharf, South Dakota
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Ore tons placed
1,199,008 915,631 974,663 1,147,130
1,149,744
Average silver grade (oz/t) 0.24
0.28 0.30 0.21 0.21
Average gold grade (oz/t) 0.033
0.037 0.031 0.032 0.035
Average plant recovery rate – Au
95.5% 89.6% 96.6% 97.3% 92.8%
Gold ounces produced
29,684 27,846 20,970 31,947 23,104
Silver ounces produced
(000's) 25 35 13 18 19
Gold equivalent ounces
produced1 30,106 28,433 21,186 32,231 23,427
Silver ounces sold (000's) 17 33 15 17 19
Gold
ounces sold 29,230 26,242 22,872 31,202 24,815
Gold
equivalent ounces sold1 29,508 26,786 23,122
31,485 25,132
Metal sales $39.3 $34.0 $27.9 $35.7
$28.0
Costs applicable to sales $19.7 $14.3 $15.5
$17.8 $17.8
Adjusted CAS per AuEqOz1 $559 $534
$667 $556 $716
Exploration expense $— $— $— $0.1 $—
Cash flow from operating activities $21.1 $16.2 $9.7
$18.1 $12.9
Sustaining capital expenditures $0.6 $1.5
$1.4 $1.2 $0.7
Development capital expenditures $— $—
$— $— $—
Total capital expenditures $0.6 $1.5 $1.4
$1.2 $0.7
Free cash flow1 $20.5 $14.7 $8.3
$16.9 $12.2
- Gold equivalent1 production remained
strong during the third quarter, increasing 6% quarter-over-quarter
largely due to a 31% increase in tons placed as well as a return to
higher plant recovery rates
- Metal sales of $39.3 million increased
16% quarter-over-quarter and 40% year-over-year
- Costs applicable to sales increased by
$5.4 million quarter-over-quarter, primarily due to a $3.7 million
inventory write-down related to lower recoveries from a leach
pad
- Adjusted CAS per AuEqOz1 of $559
increased 5% quarter-over-quarter and decreased 22%
year-over-year
- Free cash flow1 of $20.5 million
represents the highest quarter of free cash flow since Coeur
acquired the operation in February 2015 for $99 million. Since that
time, Wharf has generated total free cash flow of $72.3
million
- The Company has increased full-year
2016 production guidance to 95,000 - 100,000 gold ounces from
90,000 - 95,000 gold ounces and is reducing full-year cost guidance
to $600 - $650 per AuEqOz1 from $650 - $750
San Bartolomé, Bolivia
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Tons milled 450,409
440,441 407,806 475,695 373,201
Average silver grade (oz/t) 3.43 3.79 3.64 3.84 3.76
Average recovery rate 88.7% 87.4% 93.1% 84.9% 84.0%
Silver ounces produced (000's) 1,370 1,458 1,382
1,550 1,178
Silver ounces sold (000's) 1,391 1,418
1,384 1,564 1,202
Metal sales $27.5 $25.2 $21.3 $22.4
$17.4
Costs applicable to sales $20.8 $18.6 $17.5
$20.0 $17.5
Adjusted CAS per AgOz1 $14.40
$12.97 $12.56 $12.48 $14.41
Exploration expense $— $—
$— $— $0.1
Cash flow from operating activities $8.6
$11.2 $5.5 $10.0 $5.7
Sustaining capital expenditures
$3.0 $1.3 $0.5 $2.5 $1.8
Development capital
expenditures $— $— $— $— $—
Total capital
expenditures $3.0 $1.3 $0.5 $2.5 $1.8
Free cash
flow1 $5.6 $9.9 $5.0 $7.5 $3.9
- Silver production decreased 6%
quarter-over-quarter. While civil unrest in Bolivia during the
quarter did not impact mining operations, it hindered shipments of
purchased ore to San Bartolomé's processing facilities. This led to
a lower contribution of purchased ore to total production of 27%,
down from approximately one-third in the second quarter
- Adjusted CAS per AgOz1 were $14.40, 11%
higher quarter-over-quarter and in-line with the same quarter last
year due to fewer third-party ore purchases
- Metal sales of $27.5 million increased
9% quarter-over-quarter and 58% year-over-year
- Year-to-date free cash flow1 of $20.5
million
- The Company has revised its full-year
2016 production guidance to 5.5 - 5.8 million silver ounces from
5.8 - 6.1 million silver ounces and is maintaining cost guidance of
$13.50 - $14.25 per AgOz1
Coeur Capital
(Dollars in millions, except per ounce amounts) 3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Tons milled 42,335
37,521 86,863 198,927 191,913
Average silver grade (oz/t) 2.28 1.66 3.17 2.05 1.39
Average recovery rate 58.2% 52.5% 41.9% 42.1% 45.4%
Silver ounces produced (000's) 56 33 115 171 121
Silver ounces sold (000's) 46 35 123 193 95
Metal
sales $0.8 $0.5 $1.9 $2.4 $1.3
Royalty revenue
$(0.1) $1.8 $1.8 $1.5 $1.6
Costs applicable to sales
(Endeavor silver stream) $0.4 $0.3 $1.0 $1.0 $0.5
CAS
per AgOz1 $8.10 $7.94 $5.35 $5.50 $4.99
Cash
flow from operating activities $0.4 $(3.2) $0.8 $0.8
$3.1
Free cash flow1 $0.4 $(3.2) $0.8 $0.8
$3.1
- Completed the sale of a 2.5% net
smelter returns royalty on the Correnso mine in New Zealand in July
2016 bringing total consideration for non-core asset sales to $21.0
million year-to-date
- Coeur Capital's primary remaining asset
is a silver stream on the Endeavor mine in New South Wales,
Australia
- Silver production received from the
stream on the Endeavor mine continued to be depressed in the third
quarter compared to historical levels following a curtailment of
production by the operator due to lower lead and zinc prices
- Coeur increased its revised 2016
production guidance for Endeavor to 215,000 - 235,000 silver ounces
from 175,000 - 200,000 silver ounces
Exploration
Costs associated with exploration in the third quarter totaled
$7.0 million, including $3.7 million (expensed) for exploration
targeting the discovery of new silver and gold mineralization and
$3.3 million (capitalized) for definition and expansion of
mineralized material. For the first nine months of 2016,
exploration costs totaled $15.8 million, including $7.7 million
(expensed) and $8.1 million (capitalized). Coeur's exploration
program ramped up to 12 active drill rigs in the third quarter: six
at Palmarejo, four at Kensington, and two at Rochester. A total of
146,284 feet (44,588 meters) of combined core and reverse
circulation drilling was completed during the quarter.
On October 10th, the Company provided an update on its expanded
exploration initiatives at three of its five operating mines. The
focus of the Company’s exploration program continues to be
upgrading existing, higher-grade resources to reserves and the
discovery of new, higher-grade resources located near existing
infrastructure that have the potential to further grow the
Company’s production and cash flow, reduce unit costs, and extend
expected mine lives.
The Company expects to invest a total of $30 - $34 million in
exploration during 2016, including $14 - $16 million for expensed
exploration and $16 - $18 million for capitalized exploration. This
represents an 82% increase over 2015 exploration spending. Of the
$30 - $34 million expanded exploration budget, approximately 85% is
expected to be allocated to drilling at or near the Company’s
existing operations and about 35% is expected to be invested at the
Company’s Palmarejo underground silver-gold mine in Mexico.
Coeur has also ramped up its early stage exploration program,
which includes several projects in the U.S. and Mexico. In the
third quarter, two holes, totaling 2,046 feet were completed at the
Quito property in central Nevada, where Coeur has an earn-in
agreement with owner Bravada Gold Corporation. Drilling is expected
to commence at several other early stage projects during the
remainder of 2016, including the Klondyke project in the Tonopah
District in Nevada and the Todos Los Santos project near Chihuahua,
Mexico.
In addition, Coeur recently entered into an exploration and
option agreement with Eurasian Minerals for the Mineral Hill
gold-copper property in Wyoming, which is located approximately 15
miles west of the Company's Wharf operation. Target generation is
expected to advance in the fourth quarter with drilling expected to
commence in late 2017.
Full-Year 2016 Outlook
Full-year 2016 production guidance remains unchanged from the
revised guidance published on October 6, 2016, which reflected a
slight overall increase in expected 2016 production levels -
particularly at Palmarejo. The revised full-year 2016 cost guidance
is show in the table below, which reflects lower cost expectations
for full-year 2016 at Palmarejo, Kensington, and Wharf.
2016 Production Outlook
(silver and silver equivalent ounces in thousands)
Silver Gold Silver
Equivalent1 Palmarejo 4,100 - 4,600
70,000 - 75,000 8,300 - 9,100
Rochester 4,500 - 5,000
48,000 - 55,000 7,380 - 8,300
San Bartolomé 5,500 - 5,800 —
5,500 - 5,800
Endeavor 215 - 235 — 215 - 235
Kensington — 120,000 - 125,000 7,200 - 7,500
Wharf
80 - 100 95,000 - 100,000 5,780 - 6,100
Total 14,395 - 15,735 333,000 - 355,000
34,375 - 37,035
2016 Cost Outlook
Original Guidance Updated Guidance
(dollars in millions, except per ounce amounts)
Based on 60:1 Ratio
Based on Average Realized
Prices1
CAS per AgEqOz1 – Palmarejo $12.50 - $13.50
$10.50 - $11.00 $9.75 - $10.25
CAS per AgEqOz1
– Rochester $11.25 - $12.25 $11.25 - $12.25 $10.40 - $11.35
CAS per AgOz1 – San Bartolomé $13.50 - $14.25
$13.50 - $14.25 $13.50 - $14.25
CAS per AuOz1 –
Kensington $825 - $875 $775 - $825 $775 - $825
CAS per
AuEqOz1 – Wharf $650 - $750 $600 - $650 $600 -
$650
Capital Expenditures $90 - $100 $105 - $115 $105 - $115
General and Administrative Expenses $28 - $32 $28 - $32 $28
- $32
Exploration Expense $11 - $13 $14 - $16 $14 - $16
AISC per AgEqOz1 $16.00 - $17.25 $15.75 - $16.25
$14.25 - $14.75
Conference Call
Information
Coeur will report its full operational and financial results for
third quarter 2016 on October 26, 2016 after the New York Stock
Exchange closes for trading. There will be a conference call on
October 27, 2016 at 11:00 a.m. Eastern time.
Dial-In Numbers: (855) 560-2581 (US) (855)
669-9657 (Canada) (412) 542-4166 (International) Conference
ID: Coeur Mining
A replay of the call will be available through November 10,
2016.
Replay numbers: (877) 344-7529 (US) (855)
669-9658 (Canada) (412) 317-0088 (International) Conference
ID: 100 94 273
About Coeur
Coeur Mining is a well-diversified, growing precious metals
producer with five precious metals mines in the Americas employing
approximately 2,000 people. Coeur produces from its wholly owned
operations: the Palmarejo silver-gold complex in Mexico, the
Rochester silver-gold mine in Nevada, the Kensington gold mine in
Alaska, the Wharf gold mine in South Dakota, and the San Bartolomé
silver mine in Bolivia. The Company also has a non-operating
interest in the Endeavor mine in Australia as well as a royalty
interest in Ecuador. In addition, the Company has two silver-gold
exploration stage projects - the La Preciosa project in Mexico and
the Joaquin project in Argentina. Coeur conducts ongoing
exploration activities in Alaska, Nevada, South Dakota and
Mexico.
Cautionary Statement
This news release contains forward-looking statements within the
meaning of securities legislation in the United States and Canada,
including statements regarding Coeur’s focus on low-risk,
high-return opportunities, opportunities for reinvestment,
anticipated cash flow, production, costs, capital expenditures,
expenses, mining rates, recovery rates, mine lives, unit costs,
operations at Palmarejo, development activity at Palmarejo and
Kensington, expansion at Rochester, completion of the $200 million
at-the-market stock offering, debt reduction, improved economics of
the La Preciosa project, and exploration efforts including efforts
to upgrade resources to reserves and discover new high-grade
resources. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause
Coeur's 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, the risk that
anticipated production, cost and expense levels are not attained,
the risks and hazards inherent in the mining business (including
risks inherent in developing large-scale mining projects,
environmental hazards, industrial accidents, weather or
geologically related conditions), changes in the market prices of
gold and silver and a sustained lower price environment, the
uncertainties inherent in Coeur's production, exploratory and
developmental activities, including risks relating to permitting
and regulatory delays, ground conditions, grade variability, any
future labor disputes or work stoppages (including those involving
third parties), the uncertainties inherent in the estimation of
gold and silver reserves and resources, changes that could result
from Coeur's future acquisition of new mining properties or
businesses, the absence of control over and reliance on third
parties to operate mining operations in which Coeur or its
subsidiaries hold royalty or streaming interests and risks related
to these mining operations including results of mining and
exploration activities, environmental, economic and political risks
of the jurisdiction in which the mining operations are located, the
loss of access to 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, the political risks and uncertainties associated
with recent developments in Bolivia, Coeur's 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, Coeur's most
recent reports on Forms 10-K and 10-Q. 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.
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.
Dana Willis, Coeur's Director, Resource Geology and a qualified
person under Canadian National Instrument 43-101, approved the
scientific and technical information concerning Coeur's 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,
Canadian investors should refer to the Technical Reports for each
of Coeur's properties as filed on SEDAR at www.sedar.com.
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 EBITDA, adjusted EBITDA, total debt to LTM
adjusted EBITDA, net debt to LTM adjusted EBITDA, adjusted net
income (loss), costs applicable to sales per silver equivalent
ounce (or per gold equivalent ounce), adjusted costs applicable to
sales per silver equivalent ounce, all-in sustaining costs, and
adjusted all-in sustaining costs. 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 EBITDA, adjusted EBITDA, total debt to LTM
adjusted EBITDA, net debt to LTM adjusted EBITDA, adjusted net
income (loss), costs applicable to sales per silver equivalent
ounce (or per gold equivalent ounce), adjusted costs applicable to
sales per silver equivalent ounce, all-in sustaining costs, and
adjusted all-in sustaining costs are important measures in
assessing the Company's overall financial performance. For
additional explanation regarding our use of non-U.S. GAAP financial
measures, please refer to our Quarterly Report on Form 10-Q for the
quarter ended September 30, 2016.
Notes
1. EBITDA, adjusted EBITDA, adjusted net income (loss), all-in
sustaining costs, adjusted all-in sustaining costs, costs
applicable to sales per silver equivalent ounce (or per gold
equivalent ounce), and adjusted costs applicable to sales per
silver equivalent ounce are non-GAAP measures. Please see tables in
the Appendix for the reconciliation to U.S. GAAP. For purposes of
silver and gold equivalence, a 60:1 silver to gold ratio is assumed
except where noted as average realized prices. Free cash flow is
defined as cash flow from operating activities less capital
expenditures and gold production royalty payments. Please see table
in Appendix for the calculation of consolidated free cash flow.
Cost guidance reflecting average realized prices reflects
year-to-date average realized prices and uses $17.50 per silver
ounce and $1,251 per gold ounce for the remainder of the year.
2. Includes capital leases. Net of debt issuance costs and
premium received.
Coeur Mining, Inc. and Subsidiaries Condensed
Consolidated Statements of Comprehensive Income (Loss)
Three months ended Nine months ended
September 30, September 30, 2016
2015 2016 2015 In thousands,
except share data Revenue $ 176,247 $ 162,552 $ 506,641
$ 481,770 COSTS AND EXPENSES Costs applicable to sales(1)
105,408 120,237 307,428 354,397 Amortization 27,763 35,497 93,232
107,560 General and administrative 7,113 6,694 22,789 23,979
Exploration 3,706 2,112 7,669 9,957 Write-downs — — 4,446 —
Pre-development, reclamation, and other 4,491 4,938
13,059 13,968 Total costs and expenses 148,481
169,478 448,623 509,861 OTHER INCOME (EXPENSE), NET Fair value
adjustments, net (961 ) 5,786 (13,235 ) 3,657 Interest expense, net
of capitalized interest (8,068 ) (12,446 ) (30,063 ) (33,945 )
Other, net (3,635 ) (8,893 ) (4,178 ) (14,257 ) Total other income
(expense), net (12,664 ) (15,553 ) (47,476 ) (44,545 ) Income
(loss) before income and mining taxes 15,102 (22,479 ) 10,542
(72,636 ) Income and mining tax (expense) benefit 54,455
8,260 53,118 8,451 NET INCOME (LOSS) $ 69,557
$ (14,219 ) $ 63,660 $ (64,185 ) OTHER COMPREHENSIVE
INCOME (LOSS), net of tax: Unrealized gain (loss) on equity
securities, net of tax of $997 and $(1,177) for the three and nine
months ended September 30, 2016, respectively 1,387 (931 ) 4,533
(3,744 ) Reclassification adjustments for impairment of equity
securities — 483 20 2,028 Reclassification adjustments for realized
(gain) loss on sale of equity securities (2,965 ) — (2,691 )
904 Other comprehensive income (loss) (1,578 ) (448 ) 1,862
(812 ) COMPREHENSIVE INCOME (LOSS) $ 67,979 $ (14,667
) $ 65,522 $ (64,997 ) NET INCOME (LOSS) PER SHARE
Basic $ 0.43 $ (0.11 ) $ 0.41 $ (0.52 )
Diluted $ 0.42 $ (0.11 ) $ 0.40 $ (0.52 )
Coeur Mining, Inc. and Subsidiaries Condensed
Consolidated Statements of Cash Flows Three
months ended Nine months ended September
30, September 30, 2016 2015
2016 2015 In thousands CASH FLOWS FROM
OPERATING ACTIVITIES: Net income (loss) $ 69,557 $ (14,219 ) $
63,660 (64,185 ) Adjustments: Amortization 27,763 35,497 93,232
107,560 Accretion 2,184 3,629 8,201 10,305 Deferred income taxes
(49,463 ) (1,233 ) (66,738 ) (8,470 ) Loss on extinguishment of
debt 10,040 — 10,040 524 Fair value adjustments, net 961 (5,786 )
13,235 (3,657 ) Stock-based compensation 2,312 1,639 7,534 6,393
Impairment of equity securities — 483 20 2,028 Write-downs — —
4,446 — Other (5,236 ) 8,541 (4,763 ) 13,321 Changes in operating
assets and liabilities: Receivables 19,672 11,011 10,751 11,225
Prepaid expenses and other current assets (2,816 ) (2,055 ) (2,435
) (3,222 ) Inventory and ore on leach pads (8,900 ) 5,380 (24,408 )
10,713 Accounts payable and accrued liabilities (18,262 ) (6,117 )
(12,407 ) (12,210 ) CASH PROVIDED BY OPERATING ACTIVITIES 47,812
36,770 100,368 70,325 CASH FLOWS FROM
INVESTING ACTIVITIES: Capital expenditures (25,627 ) (23,861 )
(71,087 ) (65,158 ) Acquisitions, net (1,427 ) (122 ) (1,427 )
(111,290 ) Proceeds from the sale assets 4,802 333 16,104 498
Purchase of investments (21 ) (3 ) (120 ) (1,876 ) Sales and
maturities of investments 5,432 60 7,077 529 Other (1,299 ) 7
(4,218 ) (1,836 ) CASH USED IN INVESTING ACTIVITIES (18,140
) (23,586 ) (53,671 ) (179,133 ) CASH FLOWS FROM FINANCING
ACTIVITIES: Issuance of common stock 49,513 — 122,584 — Issuance of
notes and bank borrowings — — — 153,500 Payments on debt, capital
leases, and associated costs (107,868 ) (2,618 ) (120,551 ) (77,838
) Gold production royalty payments (7,563 ) (10,159 ) (27,155 )
(30,281 ) Other 1,051 (34 ) 323 (529 ) CASH PROVIDED
(USED IN) BY FINANCING ACTIVITIES (64,867 ) (12,811 ) (24,799 )
44,852 Effect of exchange rate changes on cash and cash
equivalents 121 (533 ) (95 ) (1,197 ) INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS (35,074 ) (160 ) 21,803 (65,153 ) Cash
and cash equivalents at beginning of period 257,591 205,868
200,714 270,861 Cash and cash equivalents at
end of period $ 222,517 $ 205,708 $ 222,517 $
205,708
Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30, December 31, 2016
2015 ASSETS In thousands, except share data
CURRENT ASSETS Cash and cash equivalents $ 222,517 $ 200,714
Receivables 67,662 85,992 Inventory 89,761 81,711 Ore on leach pads
70,446 67,329 Prepaid expenses and other 17,125 10,942
467,511 446,688 NON-CURRENT ASSETS Property, plant and
equipment, net 217,401 195,999 Mining properties, net 552,054
589,219 Ore on leach pads 63,034 44,582 Restricted assets 17,740
11,633 Equity securities 6,208 2,766 Receivables 32,427 24,768
Deferred tax assets 1,854 1,942 Other 12,713 14,892
TOTAL ASSETS $ 1,370,942 $ 1,332,489
LIABILITIES
AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES Accounts payable $
49,972 $ 48,732 Accrued liabilities and other 43,569 53,953 Debt
12,512 10,431 Royalty obligations 5,722 24,893 Reclamation 1,432
2,071 113,207 140,080 NON-CURRENT LIABILITIES Debt
389,233 479,979 Royalty obligations 6,556 4,864 Reclamation 87,277
83,197 Deferred tax liabilities 81,484 147,132 Other long-term
liabilities 60,854 55,761 625,404 770,933
STOCKHOLDERS’ EQUITY Common stock, par value $0.01 per share;
authorized 300,000,000 shares, issued and outstanding 167,565,649
at September 30, 2016 and 151,339,136 at December 31, 2015 1,676
1,513 Additional paid-in capital 3,169,631 3,024,461 Accumulated
other comprehensive income (loss) (1,860 ) (3,722 ) Accumulated
deficit (2,537,116 ) (2,600,776 ) 632,331 421,476
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 1,370,942 $
1,332,489
Adjusted EBITDA Reconciliation
(Dollars in thousands except per share amounts)
LTM 3Q 2016
3Q 2016
LTM 2Q 2016
2Q 2016 1Q 2016 4Q 2015
LTM 3Q 2015
3Q 2015
LTM 2Q 2015
Net income (loss)
$ (239,342 ) $
69,557 $ (323,118 ) $ 14,497 $ (20,396 )
$ (303,000 ) $ (1,174,213 ) $ (14,219 )
$ (1,156,528 ) Interest expense, net of capitalized interest
41,821 8,068 46,199 10,875 11,120 11,758 44,511
12,446 43,680 Income tax provision (benefit)
(70,928
) (54,455 ) (24,733 ) (768 ) 2,106 (17,811 )
(418,055 ) (8,260 ) (426,378 ) Amortization
129,422
27,763 137,156 37,505
27,964 36,190 146,162
35,497 152,651
EBITDA
(139,027 ) 50,933 (164,496 ) 62,109 20,794
(272,863 ) (1,401,595 ) 25,464 (1,386,575 ) Fair value adjustments,
net
11,689 961 4,942 3,579 8,695 (1,546 ) (10,885 )
(5,786 ) (21,205 ) Impairment of equity securities
337
— 820 20 — 317 4,008 483 4,617 Foreign exchange loss
9,882 1,466 17,326 5,655 164 2,597 10,934 8,910 2,935
(Gain) loss on sale of assets
(9,129 ) (4,498
) (4,964 ) (2,812 ) (1,673 ) (146 ) (561 ) (333 ) (320 )
(Gain) loss on debt extinguishment
(6,147 )
10,040 (16,187 ) — — (16,187 ) (155 ) — (155 ) (Gain) loss
on sale of securities
(2,712 ) (2,964 )
263 (314 ) 588 (22 ) 1,094 11 1,434 Corporate reorganization costs
133 — 647 — — 133 514 514 — Transaction-related costs
1,297 26 1,271 792 380 99 2,013 — 2,013 Asset
retirement obligation accretion
8,510 2,096 8,530
2,066 2,060 2,288 7,288 2,116 6,610 Inventory adjustments and
write-downs
9,083 4,665 5,208 946 1,944 4,901 14,337
2,280 13,640 Write-downs
317,783 —
317,783 — 4,446
313,337 1,472,721 —
1,472,721
Adjusted EBITDA $ 201,699
$ 62,725 $ 171,143
$ 72,041 $ 37,398 $ 32,908
$ 99,713 $ 33,659 $ 95,715
Adjusted Net Income (Loss)
Reconciliation
(Dollars in thousands except per share amounts)
3Q
2016 2Q 2016 1Q 2016 4Q
2015 3Q 2015 Net income (loss)
$
69,557 $ 14,497 $ (20,396 ) $ (303,000 ) $ (14,219 ) Fair
value adjustments, net
961 3,579 8,695 (1,546 ) (5,786 )
Impairment of equity securities
— 20 — 317 483 Write-downs
— — 4,446 313,337 — Inventory write-downs
3,689 — — —
— (Gain) loss on sale of assets
(4,498 ) (2,812 )
(1,673 ) (146 ) (333 ) (Gain) loss on debt extinguishments
10,040 — — (16,187 ) — (Gain) loss on sale of securities
(2,964 ) (314 ) 588 (22 ) 11 Corporate reorganization
costs
— — — 133 514 Transaction-related costs
26 792
380 99 — Tax valuation allowance release
(40,767 ) —
— —
— Foreign exchange (gain) loss
2,549 (2,810 ) (1,124 ) 753
(1,182 ) Tax effect of adjustments
(38 ) $ 3,996
$ (1,375 ) $ (37,727 ) $ 1,042
Adjusted net income
(loss) $ 38,555 $ 16,948 $ (10,459
) $ (43,989 ) $ (19,470 )
Adjusted net income (loss) per
share - Basic $ 0.24 $ 0.11 $ (0.06 ) $ (0.31 ) $
(0.14 )
Adjusted net income (loss) per share - Diluted
$ 0.23 $ 0.11 $ (0.06 ) $ (0.31 ) $ (0.14 )
Consolidated Net Debt
Reconciliation
(Dollars in thousands)
LTM 3Q 2016
LTM 2Q 2016
LTM 3Q 2015
LTM 2Q 2015
Cash and cash equivalents
$ 222,517 $ 257,591 $
205,708 $ 205,868 Total debt
401,745 511,066 545,986 547,710
Net debt
179,228 253,475 340,278 341,842 LTM adjusted EBITDA
201,699 171,143 99,713 95,715 Total debt / LTM adjusted
EBITDA
2.0x 3.0x 5.5x 5.7x Net debt / LTM adjusted EBITDA
0.9x 1.5x 3.4x 3.6x
Consolidated Free Cash Flow
Reconciliation
(Dollars in thousands)
3Q 2016 2Q
2016 1Q 2016 4Q 2015 3Q
2015 Cash flow from operating activities
$ 47,812
$ 45,939 $ 6,617 $ 43,217 $ 36,770 Capital expenditures
(25,627 ) (23,288 ) (22,172 ) (30,035 ) (23,861 )
Gold production royalty payments
(7,563 )
(10,461 ) (9,131 ) (8,954 ) (10,159 ) Free cash flow
14,622
12,190 (24,686 ) 4,228 2,750
Reconciliation of All-in Sustaining Costs per
Silver Equivalent Ounce for Three Months Ended September 30,
2016 Silver Gold
Total In thousands except per ounce amounts
Palmarejo Rochester San
Bartolomé Endeavor Total
Kensington Wharf Total Costs
applicable to sales, including amortization (U.S. GAAP) $
21,794 $ 27,027 $ 22,536 $ 486 $ 71,843
$ 34,755 $ 26,158 $ 60,913 $ 132,756
Amortization 5,761
5,244 1,723 113 12,841 8,046
6,461 14,507 27,348
Costs applicable
to sales $ 16,033 $ 21,783 $ 20,813 $ 373 $ 59,002 $ 26,709 $
19,697 $ 46,406 $ 105,408
Silver equivalent ounces sold
1,462,401 1,868,085 1,390,552 46,069 4,767,107 8,397,467
Gold
equivalent ounces sold
30,998 29,508 60,506
Costs
applicable to sales per ounce $ 10.96 $ 11.66 $ 14.97 $ 8.10 $
12.38 $ 862 $ 668 $ 767 $ 12.55
Inventory adjustments (0.26
) (0.10 ) (0.57 ) — (0.28 ) (3 ) (109 ) (55 ) (0.56 )
Adjusted costs applicable to sales per ounce $ 10.70 $ 11.56
$ 14.40 $ 8.10
$ 12.10 $ 859 $ 559
$
712 $ 11.99
Costs applicable to sales per
realized ounce $ 10.38 $ 11.16 $ 11.96 $ 11.72
Inventory
adjustments (0.24 ) (0.09 ) (0.27 ) (0.52 )
Adjusted costs
applicable to sales per realized ounce $ 10.14 $ 11.07
$
11.69 $ 11.20
Costs applicable to
sales $ 105,408
Treatment and refining costs 761
Sustaining capital 19,762
General and administrative
7,113
Exploration 3,706
Reclamation 4,036
Project/pre-development costs 2,133
All-in
sustaining costs $ 142,919 Silver equivalent
ounces sold 4,767,107
Kensington and Wharf silver equivalent
ounces sold 3,630,360
Consolidated silver equivalent
ounces sold 8,397,467
All-in sustaining costs per
silver equivalent ounce $ 17.02
Inventory adjustments $ (0.56 )
Adjusted all-in
sustaining costs per silver equivalent ounce $
16.46 All-in sustaining costs per realized
silver equivalent ounce $ 15.89
Inventory adjustments $ (0.52 )
Adjusted all-in
sustaining costs per realized silver equivalent ounce $
15.37 Reconciliation of All-in Sustaining
Costs per Silver Equivalent Ounce for Three Months Ended
June 30, 2016 Silver Gold
Total In thousands except per ounce amounts
Palmarejo Rochester San
Bartolomé Endeavor Total
Kensington Wharf Total Costs
applicable to sales, including amortization (U.S. GAAP) $
37,630 $ 27,158 $ 20,498 $ 365 $ 85,651
$ 32,419 $ 19,470 $ 51,889 $ 137,540
Amortization 14,765
5,437 1,853 84 22,139 9,808
5,128 14,936 37,075
Costs applicable
to sales $ 22,865 $ 21,721 $ 18,645 $ 281 $ 63,512 $ 22,611 $
14,342 $ 36,953 $ 100,465
Silver equivalent ounces sold
2,502,442 1,911,885 1,418,455 35,411 5,868,193 9,286,033
Gold
equivalent ounces sold
30,178 26,786 56,964
Costs
applicable to sales per ounce $ 9.14 $ 11.36 $ 13.14 $ 7.94 $
10.82 $ 749 $ 535 $ 649 $ 10.82
Inventory adjustments (0.12
) (0.06 ) (0.17 ) — (0.11 ) (9 ) (1 ) (5 ) (0.10 )
Adjusted costs applicable to sales per ounce $ 9.02 $ 11.30
$ 12.97 $ 7.94
$ 10.71 $ 740 $ 534
$
644 $ 10.72
Costs applicable to sales per
realized ounce $ 8.35 $ 10.49 $ 10.15 $ 9.69
Inventory
adjustments (0.11 ) (0.06 ) (0.10 ) (0.09 )
Adjusted costs
applicable to sales per realized ounce $ 8.24 $ 10.43
$
10.05 $ 9.60
Costs applicable to
sales $ 100,465
Treatment and refining costs 1,128
Sustaining capital 21,019
General and administrative
7,400
Exploration 2,233
Reclamation 4,170
Project/pre-development costs 2,098
All-in
sustaining costs $ 138,513 Silver equivalent
ounces sold 5,868,193
Kensington and Wharf silver equivalent
ounces sold 3,417,840
Consolidated silver equivalent
ounces sold 9,286,033
All-in sustaining costs per
silver equivalent ounce $ 14.92
Inventory adjustments $ (0.10 )
Adjusted all-in
sustaining costs per silver equivalent ounce $
14.82 All-in sustaining costs per realized
silver equivalent ounce $ 13.36
Inventory adjustments $ (0.09 )
Adjusted all-in
sustaining costs per realized silver equivalent ounce $
13.27 Reconciliation of All-in Sustaining
Costs per Silver Equivalent Ounce for Three Months Ended
March 31, 2016 Silver Gold
Total In thousands except per ounce amounts
Palmarejo Rochester San
Bartolomé Endeavor Total
Kensington Wharf Total Costs
applicable to sales, including amortization (U.S. GAAP) $
28,327 $ 27,798 $ 19,251 $ 955 $ 76,331
$ 32,767 $ 19,512 $ 52,279 $ 128,610
Amortization 7,289
5,313 1,754 299 14,655 8,349
4,051 12,400 27,055
Costs applicable
to sales $ 21,038 $ 22,485 $ 17,497 $ 656 $ 61,676 $ 24,418 $
15,461 $ 39,879 $ 101,555
Silver equivalent ounces sold
1,702,290 1,779,377 1,384,391 122,694 4,988,752 8,274,952
Gold
equivalent ounces sold
31,648 23,122 54,770
Costs
applicable to sales per ounce $ 12.36 $ 12.64 $ 12.64 $ 5.35 $
12.36 $ 772 $ 669 $ 728 $ 12.27
Inventory adjustments (0.82
) (0.03 ) (0.08 ) — (0.31 ) (11 ) (2 ) (7 ) (0.23 )
Adjusted costs applicable to sales per ounce $ 11.54 $ 12.61
$ 12.56 $ 5.35
$ 12.05 $ 761 $ 667
$
721 $ 12.04
Costs applicable to sales per
realized ounce $ 10.90 $ 11.32 $ 11.37 $ 10.50
Inventory
adjustments (0.72 ) (0.03 ) (0.29 ) (0.20 )
Adjusted costs
applicable to sales per realized ounce $ 10.18 $ 11.29
$
11.08 $ 10.30
Costs applicable to
sales $ 101,555
Treatment and refining costs 1,158
Sustaining capital 16,710
General and administrative
8,276
Exploration 1,731
Reclamation 3,759
Project/pre-development costs 1,558
All-in
sustaining costs $ 134,747 Silver equivalent
ounces sold 4,988,752
Kensington and Wharf silver equivalent
ounces sold 3,286,200
Consolidated silver equivalent
ounces sold 8,274,952
All-in sustaining costs per
silver equivalent ounce $ 16.28
Inventory adjustments $ (0.23 )
Adjusted all-in
sustaining costs per silver equivalent ounce $
16.05 All-in sustaining costs per realized
silver equivalent ounce $ 13.93
Inventory adjustments $ (0.20 )
Adjusted all-in
sustaining costs per realized silver equivalent ounce $
13.73 Reconciliation of All-in Sustaining
Costs per Silver Equivalent Ounce for Three Months Ended
December 31, 2015 Silver
Gold Total In thousands except per ounce
amounts Palmarejo Rochester San
Bartolomé Endeavor Total
Kensington Wharf Total Costs
applicable to sales, including amortization (U.S. GAAP) $
47,207 $ 27,716 $ 24,372 $ 2,579 $
101,874 $ 33,298 $ 25,033 $ 58,331 $ 160,205
Amortization
7,426 4,944 4,311 1,519 18,200
9,503 7,246 16,749 34,949
Costs
applicable to sales $ 39,781 $ 22,772 $ 20,061 $ 1,060 $ 83,674
$ 23,795 $ 17,787 $ 41,582 $ 125,256
Silver equivalent ounces
sold 2,588,185 1,820,471 1,564,155 192,768 6,165,579 9,885,699
Gold equivalent ounces sold
29,988 32,014 62,002
Costs
applicable to sales per ounce $ 15.37 $ 12.51 $ 12.83 $ 5.50 $
13.57 $ 793 $ 556 $ 671 $ 12.67
Inventory adjustments (1.89
) (0.14 ) (0.35 ) — (0.92 ) (16 ) — (8 ) (0.62 )
Adjusted costs applicable to sales per ounce $ 13.48 $ 12.37
$ 12.48 $ 5.50
$ 12.65 $ 777 $ 556
$
663 $ 12.05
Costs applicable to sales per
realized ounce $ 13.73 $ 11.32 $ 12.56 $ 10.98
Inventory
adjustments (1.69 ) (0.13 ) (0.85 ) (0.54 )
Adjusted costs
applicable to sales per realized ounce $ 12.04 $ 11.19
$
11.71 $ 10.44
Costs applicable to
sales $ 125,256
Treatment and refining costs 964
Sustaining capital 16,567
General and administrative
8,855
Exploration 1,689
Reclamation 4,963
Project/pre-development costs 2,691
All-in
sustaining costs $ 160,985 Silver equivalent
ounces sold 6,165,579
Kensington and Wharf silver equivalent
ounces sold 3,720,120
Consolidated silver equivalent
ounces sold 9,885,699
All-in sustaining costs per
silver equivalent ounce $ 16.28
Inventory adjustments $ (0.62 )
Adjusted all-in
sustaining costs per silver equivalent ounce $
15.66 All-in sustaining costs per realized
silver equivalent ounce $ 14.09
Inventory adjustments $ (0.54 )
Adjusted all-in
sustaining costs per realized silver equivalent ounce $
13.55 Reconciliation of All-in Sustaining
Costs per Silver Equivalent Ounce for Three Months Ended
September 30, 2015 Silver
Gold Total In thousands except per ounce
amounts Palmarejo Rochester San
Bartolomé Endeavor Total
Kensington Wharf Total Costs
applicable to sales, including amortization (U.S. GAAP) $
42,710 $ 32,167 $ 21,009 $ 1,384 $
97,270 $ 33,472 $ 23,419 $ 56,891 $ 154,161
Amortization
8,617 6,731 3,526 909 19,783
8,499 5,642 14,141 33,924
Costs
applicable to sales $ 34,093 $ 25,436 $ 17,483 $ 475 $ 77,487 $
24,973 $ 17,777 $ 42,750 $ 120,237
Silver equivalent ounces
sold 2,924,947 2,116,353 1,201,959 95,260 6,338,519 9,512,459
Gold equivalent ounces sold
28,084 24,815 52,899
Costs
applicable to sales per ounce $ 11.66 $ 12.02 $ 14.55 $ 4.99 $
12.22 $ 889 $ 716 $ 808 $ 12.64
Inventory adjustments (0.26
) (0.01 ) (0.14 ) — (0.15 ) (47 ) — (25 ) (0.24 )
Adjusted costs applicable to sales per ounce $ 11.40 $ 12.01
$ 14.41 $ 4.99
$ 12.07 $ 842 $ 716
$
783 $ 12.40
Costs applicable to sales per
realized ounce $ 10.25 $ 10.90 $ 11.14 $ 10.95
Inventory
adjustments (0.24 ) (0.01 ) (0.14 ) (0.21 )
Adjusted costs
applicable to sales per realized ounce $ 10.01 $ 10.89
$
11.00 $ 10.74
Costs applicable to
sales $ 120,237
Treatment and refining costs 820
Sustaining capital 8,565
General and administrative
6,694
Exploration 2,112
Reclamation 4,493
Project/pre-development costs 3,648
All-in
sustaining costs $ 146,569 Silver equivalent
ounces sold 6,338,519
Kensington and Wharf silver equivalent
ounces sold 3,173,940
Consolidated silver equivalent
ounces sold 9,512,459
All-in sustaining costs per
silver equivalent ounce $ 15.41
Inventory adjustments $ (0.24 )
Adjusted all-in
sustaining costs per silver equivalent ounce $
15.17 All-in sustaining costs per realized
silver equivalent ounce $ 13.35
Inventory adjustments $ (0.21 )
Adjusted all-in
sustaining costs per realized silver equivalent ounce $
13.14 Reconciliation of All-in Sustaining
Costs per Silver Equivalent Ounce for 2016 Guidance
Silver Gold In
thousands except per ounce amounts Palmarejo
Rochester San Bartolomé Endeavor
Total Silver Kensington
Wharf Total Gold Total Combined
Costs applicable to sales, including amortization (U.S.
GAAP) $ 130,000 $ 120,000 $ 87,000 $ 2,500
$ 339,500 $ 137,000 $ 82,000 $ 219,000
$ 558,500
Amortization 40,000 28,000
7,000 1,000 76,000 37,000 20,000
57,000 133,000
Costs applicable to sales $ 90,000 $
92,000 $ 80,000 $ 1,500 $ 263,500 $ 100,000 $ 62,000 $ 162,000 $
425,500
Silver equivalent ounces sold 8,400,000 7,890,000
5,700,000 220,000 22,210,000 35,710,000
Gold equivalent ounces
sold
125,000 100,000 225,000
Costs applicable to sales per ounce guidance
$10.50-$11.00 $11.25-$12.25 $13.50-$14.25
$775-$825 $600-$650 Costs applicable
to sales $ 425,500
Treatment and refining costs 4,500
Sustaining capital, including capital lease payments 75,000
General and administrative 30,000
Exploration 15,000
Reclamation 16,000
Project/pre-development costs
5,000
All-in sustaining costs $ 571,000
Silver equivalent
ounces sold 22,210,000
Kensington and Wharf silver
equivalent ounces sold 13,500,000
Consolidated silver
equivalent ounces sold 35,710,000
All-in sustaining costs
per silver equivalent ounce guidance $15.75-$16.25
Reconciliation of All-in Sustaining Costs per Realized
Silver Equivalent Ounce for 2016 Guidance
Silver Gold In thousands except per
ounce amounts Palmarejo Rochester
San Bartolomé Endeavor Total
Silver Kensington Wharf
Total Gold Total Combined Costs applicable
to sales, including amortization (U.S. GAAP) $ 130,000 $
120,000 $ 87,000 $ 2,500 $ 339,500 $
137,000 $ 82,000 $ 219,000 $ 558,500
Amortization 40,000 28,000 7,000 1,000
76,000 37,000 20,000 57,000
133,000
Costs applicable to sales $ 90,000 $ 92,000 $ 80,000
$ 1,500 $ 263,500 $ 100,000 $ 62,000 $ 162,000 $ 425,500
Silver
equivalent ounces sold 9,105,000 8,430,000 5,700,000 220,000
23,455,000 36,955,000
Gold equivalent ounces sold
125,000 100,000 225,000
Costs
applicable to sales per ounce guidance $9.75-$10.25
$10.40-$11.35 $13.50-$14.25 $775-$825
$600-$650 Costs applicable to sales $
425,500
Treatment and refining costs 4,500
Sustaining
capital, including capital lease payments 75,000
General and
administrative 30,000
Exploration 15,000
Reclamation 16,000
Project/pre-development costs
5,000
All-in sustaining costs $ 571,000
Silver equivalent
ounces sold 23,455,000
Kensington and Wharf silver
equivalent ounces sold 16,085,250
Consolidated silver
equivalent ounces sold 39,540,250
All-in sustaining costs
per silver equivalent ounce guidance $14.25-$14.75
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161026006489/en/
Coeur Mining, Inc.Courtney Lynn, Vice President, Investor
Relations and Treasurer(312) 489-5837www.coeur.com
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