Stillwater Mining Company (NYSE:SWC) today
reported financial results for the quarter ended September 30,
2016.
Third Quarter 2016 Highlights:
- Continued positive safety performance, with a reportable
incidence rate decrease of 13.2% compared to the third quarter of
2015
- PGM mined sales of 131,800 ounces, an increase of 12.4% from
117,300 ounces sold during the third quarter of 2015
- Costs of metals sold of $498 per PGM mined ounce, down 15.3%
from $588 per PGM mined ounce for the third quarter of 2015
- PGM mined production of 138,800 ounces, an increase of 8.4%
from 128,100 PGM mined ounces during the third quarter of 2015
- All-in sustaining costs (AISC)* of $624 per PGM mined ounce
produced, down 7.8% from $677 per PGM mined ounce for the third
quarter of 2015
- Processed 175,000 ounces of recycled palladium, platinum and
rhodium; an increase of 8.7% over 161,000 ounces recycled during
the third quarter of 2015 and a Company record
- Cash and cash equivalents plus highly liquid investments of
$439.4 million at quarter end, after funding a $22.4 million
increase of recycling working capital and all capital deployed
during the third quarter of 2016
- Consolidated net income attributable to common stockholders of
$12.6 million or $0.10 per diluted share, compared to a
consolidated net loss attributable to common stockholders of $11.9
million or $0.10 per diluted share for the third quarter of 2015,
reflecting cost reductions and an increase in sales price per PGM
mined ounce to $764 from $693 realized for the third quarter of
2015
Commenting on the third quarter 2016 results,
Mick McMullen, the Company’s President and Chief Executive Officer
stated, “The third quarter 2016 results demonstrate that Stillwater
Mining Company continues to deliver on operational plans and stated
objectives. Our efforts to grow the recycling business have been
successful as we processed 175,000 ounces of recycled PGMs during
the third quarter of 2016, which was a Company record. Mined
production and costs were in-line with our expectations. Based on
our year-to-date results and future outlook, we remain confident in
our ability to achieve the improved full-year guidance targets
provided last quarter.
"In addition to the many operational improvements made
throughout the organization, our safety performance has continued
on a record pace. The safety incidence rate for the third quarter
of 2016 decreased by 13.2% compared to the third quarter of 2015.
Even more impressive, our safety incidence rate through the first
nine months of 2016 is less than the record low rate achieved last
year.
"The Company remains focused on Blitz, our primary growth
project. The progress on the two critical path items to first
production, the 56 East development heading and the 53 East decline
is ahead of plan. In addition, considerable engineering work has
been updated on the Blitz project. This new work has driven a
substantial increase to the scope of the project with relatively
minimal additional costs. As a result of the new work performed,
the project now incorporates the lower Blitz area. We now
anticipate that Blitz will add between 270,000 and 330,000 ounces
of mine production annually when fully ramped up by 2021-2022. This
is anticipated to be all incremental production for at least the
first decade of the Blitz production phase. Costs for the project
are expected to increase to approximately $250 million from the
previous $205 million estimate, which we consider to be a small
escalation given the much expanded scope of the project and the
acceleration of the production profile. Additional capital will be
required for expansion of the Stillwater Mine concentrator to treat
the increased ore tonnage and the related work is currently
underway.
Mr. McMullen concluded, “The third quarter
provides another data point for the evaluation of the progress we
are making at Stillwater. As the business continues to evolve, we
have consistently reached our performance targets, while achieving
record safety results. I believe we have successfully established a
foundation of financial discipline and focus on continuous
operational improvement that will allow our shareholders to benefit
from the world-class mining and processing assets we possess along
with robust PGM market fundamentals. I would like to thank our team
for the hard work to achieve the success Stillwater has experienced
to date and the continued efforts for future progress."
2016 Full-Year Guidance:
Following a review of the third quarter 2016 results and
forecasts for the remainder of the year, guidance for the full-year
2016 is unchanged as detailed in the table below.
|
|
Current 2016 Guidance |
|
Sales of PGM Mined
Ounces |
|
545,000 - 555,000 |
|
Total Costs of Metals
Sold per PGM Mined Ounce(1) |
|
$495 -
$520 |
|
PGM Mined Production
Ounces |
|
535,000 - 545,000 |
|
Total Cash Costs per
PGM Mined Ounce (net of by-product and recycling credits)* |
|
$430 -
$455 |
|
All-In Sustaining Costs
per PGM Mined Ounce Produced* |
|
$595 -
$635 |
|
General and
Administrative (millions) |
|
$30 -
$40 |
|
Exploration
(millions)(2) |
|
$8 -
$11 |
|
Sustaining Capital
Expenditures (millions) |
|
$50 -
$60 |
|
Project Capital
Expenditures (millions)(3) |
|
$40 -
$45 |
|
Total Capital
Expenditures (millions)(3) |
|
$90 -
$105 |
|
(1) Total
costs of metals sold from mine production divided by PGM mined
ounces sold. |
|
(2)
Exploration includes expenses for Marathon, Altar and Montana
operations. |
|
(3)
Excludes project capitalized interest and project capitalized
depreciation. |
|
|
|
Third Quarter 2016 Results:
For the third quarter of 2016, the Company
reported consolidated net income attributable to common
stockholders of $12.6 million, or $0.10 per diluted share, compared
to a consolidated net loss attributable to common stockholders of
$11.9 million, or $0.10 per diluted share for the third quarter of
2015. The third quarter of 2016 was positively impacted by cost
reductions, an increase in realized metal prices and higher mined
sales volumes compared to the third quarter of 2015.
PGM Mine Production Comparison:
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(Produced
ounces) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Palladium |
|
64,300 |
|
59,300 |
|
189,900 |
|
|
183,000 |
|
Platinum |
|
19,700 |
|
17,700 |
|
58,100 |
|
|
54,500 |
|
Stillwater Mine
Total |
|
84,000 |
|
77,000 |
|
248,000 |
|
|
237,500 |
|
|
|
|
|
|
|
|
|
|
|
Palladium |
|
42,600 |
|
39,700 |
|
128,500 |
|
|
117,500 |
|
Platinum |
|
12,200 |
|
11,400 |
|
36,700 |
|
|
33,400 |
|
East Boulder Mine
Total |
|
54,800 |
|
51,100 |
|
165,200 |
|
|
150,900 |
|
|
|
|
|
|
|
|
|
|
|
Palladium |
|
106,900 |
|
99,000 |
|
318,400 |
|
|
300,500 |
|
Platinum |
|
31,900 |
|
29,100 |
|
94,800 |
|
|
87,900 |
|
Total |
|
138,800 |
|
128,100 |
|
413,200 |
|
|
388,400 |
|
|
|
|
|
|
|
|
|
|
|
|
Mine production revenues (including proceeds
from the sale of by-products) totaled $106.9 million in the third
quarter of 2016, an increase from $86.4 million for the third
quarter of 2015. The combined average realized price for the sales
of mined palladium and platinum increased for the third quarter of
2016 to $764 per ounce, compared to $693 per ounce realized in the
third quarter of 2015. The total quantity of mined palladium and
platinum sold in the third quarter of 2016 was 131,800 ounces
compared to 117,300 ounces sold in the third quarter of 2015.
Total costs of metals sold from PGM mined
production decreased to $65.6 million in the third quarter of 2016
from $69.0 million in the third quarter of 2015.
Recycling Activity Comparison:
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Average tons of
catalyst fed per day |
|
25.1 |
|
|
22.7 |
|
|
24.8 |
|
|
21.9 |
|
Tons processed |
|
2,308 |
|
|
2,087 |
|
|
6,760 |
|
|
5,987 |
|
Tons tolled |
|
546 |
|
|
794 |
|
|
2,241 |
|
|
2,420 |
|
Tons
purchased |
|
1,762 |
|
|
1,293 |
|
|
4,519 |
|
|
3,567 |
|
PGM ounces fed |
|
175,000 |
|
|
161,000 |
|
|
499,100 |
|
|
421,300 |
|
PGM ounces sold |
|
117,600 |
|
|
88,800 |
|
|
266,200 |
|
|
231,500 |
|
PGM tolled ounces
returned |
|
49,900 |
|
|
73,700 |
|
|
196,500 |
|
|
150,300 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total recycled PGM ounces fed to the smelter of 175,000 for the
third quarter of 2016 was a Company record and an increase of 8.7%
from the third quarter of 2015. The recycling business segment
continued to experience a shift from tolled to purchased material
in the third quarter of 2016.
PGM recycling revenues totaled $89.6 million for
the 2016 third quarter, an increase from $82.0 million in the same
period of 2015. The Company's combined average realized price for
sales of recycled palladium, platinum and rhodium decreased to $742
per ounce in the third quarter of 2016 compared to $881 per ounce
in the third quarter of 2015. Recycling sales volumes for the third
quarter of 2016 increased to 117,600 ounces from 88,800 ounces sold
in the third quarter of 2015. In conjunction, tolled ounces
returned to customers decreased to 49,900 ounces for the third
quarter of 2016 from 73,700 ounces in the third quarter of
2015.
PGM recycling costs of metals sold totaled $86.2
million in the third quarter of 2016, an increase from $78.9
million in the third quarter of 2015. A majority of the costs of
metals sold from recycling in each period is attributable to the
acquisition cost of purchasing recyclable materials for the
Company's own account; therefore, the aggregate costs of metals
sold from the PGM Recycling segment is driven by the volume and the
value of the PGMs in the materials purchased by the Company.
General and administrative costs were $8.7
million in the third quarter of 2016, compared to $8.9 million
incurred during the same period of 2015.
Costs of Metals Sold Per PGM Mined Ounce:
Costs of metals sold per PGM mined ounce totaled
$498 for the third quarter of 2016, a decrease from $588 recorded
for the third quarter of 2015. Cost improvement initiatives and
reduced labor costs contributed to the lower costs of metals sold
per PGM mined ounce result.
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
Costs of Metals
Sold Per PGM Mined Ounce |
|
|
|
|
|
|
|
|
Combined Montana Mining Operations |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Costs of metals sold
per PGM mined ounce |
|
$ |
498 |
|
|
$ |
588 |
|
|
$ |
503 |
|
|
$ |
593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All-In Sustaining Costs Per PGM Mined Ounce
Produced:
AISC* per PGM mined ounce produced totaled $624
for the third quarter of 2016, a decrease from $677 recorded for
the same period of 2015. Reductions in cash costs and sustaining
capital contributed to the lower AISC result.
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
All-In Sustaining Costs Per PGM Mined
Ounce |
|
|
|
|
|
|
|
|
Combined Montana Mining Operations |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Total combined cash
costs per PGM mined ounce, net of by-product and recycling credits
* |
|
$ |
434 |
|
|
$ |
465 |
|
|
$ |
433 |
|
|
$ |
511 |
|
PGM
Recycling income credit per mined ounce |
|
28 |
|
|
25 |
|
|
21 |
|
|
19 |
|
Corporate
general and administrative costs (before Depreciation, Depletion
and Amortization |
|
58 |
|
|
66 |
|
|
57 |
|
|
67 |
|
Capital
outlay to sustain production at the Montana operating mines |
|
104 |
|
|
121 |
|
|
98 |
|
|
145 |
|
All-In Sustaining Costs
per PGM mined ounce* |
|
$ |
624 |
|
|
$ |
677 |
|
|
$ |
609 |
|
|
$ |
742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Costs Per PGM Mined Ounce:
Total combined cash costs per PGM mined ounce
(net of by-product and recycling credits)* totaled $434 per ounce
for the third quarter of 2016, a significant reduction from $465
per ounce for the third quarter of 2015.
The table below illustrates the effect of
applying the by-product and PGM Recycling segment credits to the
total cash costs per PGM mined ounce for the Montana mining
operations.
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
Combined Montana Mining Operations |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Total combined cash
costs per PGM mined ounce, before by-product and recycling credits
* |
|
$ |
506 |
|
|
$ |
529 |
|
|
$ |
496 |
|
|
$ |
578 |
|
Less:
By-product revenue credit per mined ounce |
|
44 |
|
|
39 |
|
|
42 |
|
|
48 |
|
Less: PGM
Recycling income credit per mined ounce |
|
28 |
|
|
25 |
|
|
21 |
|
|
19 |
|
Total combined cash
costs per PGM mined ounce, net of by-product and recycling credits
* |
|
$ |
434 |
|
|
$ |
465 |
|
|
$ |
433 |
|
|
$ |
511 |
|
|
*These are non-GAAP financial
measures. For a full description and reconciliation of these and
other non-GAAP financial measures to GAAP financial measures, see
Reconciliation of GAAP Financial Measures to Non-GAAP Financial
Measures and Reconciliation of Total Cash Costs Guidance and AISC
Guidance below. |
|
Cash Flow and Liquidity:
At September 30, 2016, the Company’s cash and
cash equivalents balance was $113.0 million, compared to $147.3
million at December 31, 2015. The Company’s cash and cash
equivalents plus highly liquid investments totaled $439.4 million
at September 30, 2016 (including $18.5 million of investments which
have been reserved as collateral on letters of credit), compared to
$463.8 million at December 31, 2015. Net working capital
increased to $532.9 million at September 30, 2016, compared to
$523.0 million at December 31, 2015.
Net cash provided by operating activities (which
includes changes in working capital) totaled $38.2 million for the
nine months ended September 30, 2016, compared to $75.7 million for
the same period in 2015. Cash capital expenditures were $62.0
million for the nine months ended September 30, 2016, compared to
$83.4 million in the same period in 2015.
Outstanding total balance sheet debt reported at
September 30, 2016, was approximately $269.1 million, an increase
from $255.8 million at December 31, 2015. The Company’s debt
balance at September 30, 2016, included approximately $268.6
million of 1.75% convertible debentures (net of unamortized
discount of approximately $63.5 million and $3.2 million of
deferred debt issuance costs) and $0.5 million of 1.875%
convertible debentures. The change in debt balance is a result of
the accretion of the discount on the Company's outstanding 1.75%
convertible debentures.
2016 Third Quarter Results Webcast and Conference Call:
Stillwater Mining Company will conduct a conference call to
discuss third quarter 2016 results at 12:00 noon Eastern Daylight
Time on Friday, October 28, 2016.
Dial-In Numbers: |
United
States: |
(877)
407-8037 |
|
International: |
(201)
689-8037 |
|
|
|
A simultaneous webcast of the conference call and related
presentation materials will be accessible in the Investor Relations
section of the Company's website at:
www.stillwatermining.com.
A telephone replay of the call will be available
for one week following the event. The replay dial-in numbers are
(877) 660-6853 (U.S.) and (201) 612-7415 (International), access
code 13631292. The call transcript will be archived in the Investor
Relations section of the Company's website.
About Stillwater Mining Company
Stillwater Mining Company is the only U.S. miner of platinum
group metals (PGMs) and the largest primary producer of PGMs
outside of South Africa and the Russian Federation. PGMs are rare
precious metals used in a wide variety of applications, including
automobile catalysts, fuel cells, hydrogen purification,
electronics, jewelry, dentistry, medicine and coinage. The Company
is engaged in the development, extraction and processing of PGMs
from a geological formation in south-central Montana recognized as
the J-M Reef. The J-M Reef is the only known significant source of
PGMs in the U.S. and the highest-grade PGM resource known in the
world. The Company also recycles PGMs from spent catalytic
converters and other industrial sources. The Company owns the
Marathon PGM-copper deposit in Ontario, Canada, and the Altar
porphyry copper-gold deposit located in the San Juan province of
Argentina. The Company’s shares are traded on the New York Stock
Exchange under the symbol "SWC". Information about the Company can
be found at its website: www.stillwatermining.com.
Cautionary Note Concerning
Forward-Looking Statements
Some statements contained in this press release are
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended, and, therefore,
involve uncertainties or risks that could cause actual results to
differ materially from management's expectations. These statements
may contain words such as “believes,” “anticipates,” “plans,”
“expects,” “intends,” “estimates,” “predicts,” “should,” “will,”
“may” or similar expressions. Such statements also include, but are
not limited to, comments regarding continuing to deliver on
operational plans and stated objectives; successful efforts to grow
the recycling business; remaining confident in ability to achieve
full-year guidance targets; increasing the scope of the Blitz
project with relatively minimal additional costs; anticipation that
the Blitz project with add between 270,000 and 330,000 ounces of
mine production when fully ramped up by 2021-2022; anticipation
that new production from Blitz will be incremental for at least the
first decade of the Blitz production phase; costs for the Blitz
project increasing to $250 million; additional capital required for
the expansion of the Stillwater Mine concentrator; a foundation of
financial discipline and operational improvement that will allow
shareholders to benefit from the Company’s world-class mining and
processing assets along with robust PGM market fundamentals; 2016
guidance for sales of mined ounces, total costs of metals sold per
PGM mined ounce, PGM mined production ounces, total cash costs per
PGM mined ounce (net of credits), all-in sustaining costs per PGM
mined ounce, general and administrative costs, exploration
expenditures and capital expenditures; and the usefulness of
non-GAAP financial measures. The forward-looking statements in this
release are based on assumptions and analyses made by management in
light of experience and perception of historical trends, current
conditions, expected future developments, and other factors that
are deemed appropriate. These statements are not guarantees of the
Company’s future performance and are subject to risks,
uncertainties and other important factors that could cause its
actual performance or achievements to differ materially from those
expressed or implied by these forward-looking statements.
Additional information regarding factors that could cause results
to differ materially from management's expectations is found in the
section entitled "Risk Factors" in the Company's Annual Report on
Form 10-K, which was filed with the Securities and Exchange
Commission on February 22, 2016. The Company intends that the
forward-looking statements contained herein be subject to the
above-mentioned statutory safe harbors. Investors are cautioned not
to rely on forward-looking statements. The forward-looking
statements herein speak only as of the date of this release. The
Company disclaims any obligation to update forward-looking
statements.
Stillwater Mining CompanyConsolidated
Statements of Comprehensive Income
(Loss)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except per share data) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
REVENUES |
|
|
|
|
|
|
|
|
Mine
Production |
|
$ |
106,926 |
|
|
$ |
86,359 |
|
|
$ |
299,123 |
|
|
$ |
331,065 |
|
PGM
Recycling |
|
89,591 |
|
|
81,982 |
|
|
196,515 |
|
|
222,980 |
|
Other |
|
100 |
|
|
100 |
|
|
300 |
|
|
300 |
|
Total
revenues |
|
196,617 |
|
|
168,441 |
|
|
495,938 |
|
|
554,345 |
|
COSTS AND
EXPENSES |
|
|
|
|
|
|
|
|
Costs of
metals sold |
|
|
|
|
|
|
|
|
Mine
Production |
|
65,580 |
|
|
69,004 |
|
|
208,612 |
|
|
229,676 |
|
PGM
Recycling |
|
86,178 |
|
|
78,928 |
|
|
188,712 |
|
|
216,074 |
|
Total
costs of metals sold (excludes depletion, depreciation and
amortization) |
|
151,758 |
|
|
147,932 |
|
|
397,324 |
|
|
445,750 |
|
Depletion, depreciation and amortization |
|
|
|
|
|
|
|
|
Mine
Production |
|
17,587 |
|
|
15,132 |
|
|
55,173 |
|
|
48,943 |
|
PGM
Recycling |
|
184 |
|
|
230 |
|
|
569 |
|
|
738 |
|
Total
depletion, depreciation and amortization |
|
17,771 |
|
|
15,362 |
|
|
55,742 |
|
|
49,681 |
|
Total
costs of revenues |
|
169,529 |
|
|
163,294 |
|
|
453,066 |
|
|
495,431 |
|
Exploration |
|
499 |
|
|
827 |
|
|
4,934 |
|
|
2,667 |
|
Reorganization |
|
— |
|
|
1,658 |
|
|
— |
|
|
1,658 |
|
General
and administrative |
|
8,692 |
|
|
8,911 |
|
|
25,300 |
|
|
27,652 |
|
Gain on
sale of long-term investments |
|
(196 |
) |
|
— |
|
|
(678 |
) |
|
— |
|
Impairment of non-producing mineral properties |
|
— |
|
|
— |
|
|
— |
|
|
46,772 |
|
Loss on
long-term investments |
|
— |
|
|
151 |
|
|
— |
|
|
204 |
|
Loss
(gain) on disposal of property, plant and equipment |
|
82 |
|
|
(219 |
) |
|
(72 |
) |
|
(216 |
) |
Total
costs and expenses |
|
178,606 |
|
|
174,622 |
|
|
482,550 |
|
|
574,168 |
|
OPERATING
INCOME (LOSS) |
|
18,011 |
|
|
(6,181 |
) |
|
13,388 |
|
|
(19,823 |
) |
OTHER INCOME
(EXPENSE) |
|
|
|
|
|
|
|
|
Other |
|
9 |
|
|
17 |
|
|
95 |
|
|
918 |
|
Loss on
extinguishment of debt, net |
|
— |
|
|
(4,010 |
) |
|
— |
|
|
(4,010 |
) |
Interest
income |
|
1,213 |
|
|
766 |
|
|
2,883 |
|
|
2,192 |
|
Interest
expense, net of capitalized interest |
|
(3,958 |
) |
|
(5,097 |
) |
|
(12,207 |
) |
|
(15,713 |
) |
Foreign
currency transaction gain, net |
|
466 |
|
|
12 |
|
|
1,660 |
|
|
149 |
|
INCOME (LOSS)
BEFORE INCOME TAX (PROVISION) BENEFIT |
|
15,741 |
|
|
(14,493 |
) |
|
5,819 |
|
|
(36,287 |
) |
Income
tax (provision) benefit |
|
(3,142 |
) |
|
2,464 |
|
|
(2,367 |
) |
|
8,127 |
|
NET INCOME
(LOSS) |
|
$ |
12,599 |
|
|
$ |
(12,029 |
) |
|
$ |
3,452 |
|
|
$ |
(28,160 |
) |
Net loss attributable
to noncontrolling interest |
|
— |
|
|
(151 |
) |
|
— |
|
|
(11,808 |
) |
NET INCOME
(LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS |
|
$ |
12,599 |
|
|
$ |
(11,878 |
) |
|
$ |
3,452 |
|
|
$ |
(16,352 |
) |
Other
comprehensive income, net of tax |
|
|
|
|
|
|
|
|
Net
unrealized (loss) gain on investments available-for-sale and
deferred compensation |
|
(193 |
) |
|
(34 |
) |
|
337 |
|
|
149 |
|
COMPREHENSIVE
INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS |
|
$ |
12,406 |
|
|
$ |
(11,912 |
) |
|
$ |
3,789 |
|
|
$ |
(16,203 |
) |
Comprehensive loss
attributable to noncontrolling interest |
|
— |
|
|
(151 |
) |
|
— |
|
|
(11,808 |
) |
TOTAL
COMPREHENSIVE INCOME (LOSS) |
|
$ |
12,406 |
|
|
$ |
(12,063 |
) |
|
$ |
3,789 |
|
|
$ |
(28,011 |
) |
Weighted
average shares of common stock outstanding |
|
|
|
|
|
|
|
|
Basic |
|
121,077 |
|
|
120,960 |
|
|
121,069 |
|
|
120,746 |
|
Diluted |
|
121,634 |
|
|
120,960 |
|
|
121,438 |
|
|
120,746 |
|
Basic income
(loss) per share attributable to common stockholders |
|
$ |
0.10 |
|
|
$ |
(0.10 |
) |
|
$ |
0.03 |
|
|
$ |
(0.14 |
) |
Diluted income
(loss) per share attributable to common stockholders |
|
$ |
0.10 |
|
|
$ |
(0.10 |
) |
|
$ |
0.03 |
|
|
$ |
(0.14 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyConsolidated
Balance Sheets(Unaudited)
|
|
September 30, |
|
December 31, |
(In thousands, except per share data) |
|
2016 |
|
2015 |
ASSETS |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash
equivalents |
|
$ |
112,967 |
|
|
$ |
147,336 |
|
Investments, at fair
value |
|
326,445 |
|
|
316,429 |
|
Inventories |
|
140,781 |
|
|
102,072 |
|
Trade receivables |
|
1,404 |
|
|
800 |
|
Prepaid expenses |
|
4,626 |
|
|
2,821 |
|
Other current
assets |
|
21,240 |
|
|
21,628 |
|
Total
current assets |
|
607,463 |
|
|
591,086 |
|
Mineral properties |
|
112,480 |
|
|
112,480 |
|
Mine development,
net |
|
480,266 |
|
|
460,751 |
|
Property, plant and
equipment, net |
|
103,223 |
|
|
109,957 |
|
Other noncurrent
assets |
|
4,478 |
|
|
4,115 |
|
Total
assets |
|
$ |
1,307,910 |
|
|
$ |
1,278,389 |
|
LIABILITIES AND
EQUITY |
|
|
|
|
Current
liabilities |
|
|
|
|
Accounts payable |
|
$ |
24,202 |
|
|
$ |
18,205 |
|
Accrued compensation
and benefits |
|
30,431 |
|
|
30,046 |
|
Property, production
and franchise taxes payable |
|
12,406 |
|
|
13,907 |
|
Current portion of
long-term debt and capital lease obligations |
|
— |
|
|
657 |
|
Income taxes
payable |
|
647 |
|
|
— |
|
Other current
liabilities |
|
6,910 |
|
|
5,286 |
|
Total
current liabilities |
|
74,596 |
|
|
68,101 |
|
Long-term debt |
|
269,059 |
|
|
255,099 |
|
Deferred income
taxes |
|
19,390 |
|
|
22,761 |
|
Accrued workers
compensation |
|
6,420 |
|
|
6,070 |
|
Asset retirement
obligation |
|
11,376 |
|
|
11,027 |
|
Other noncurrent
liabilities |
|
11,351 |
|
|
6,102 |
|
Total
liabilities |
|
392,192 |
|
|
369,160 |
|
EQUITY |
|
|
|
|
Stockholders’
equity |
|
|
|
|
Preferred stock, $0.01
par value, 1,000,000 shares authorized; none issued |
|
— |
|
|
— |
|
Common stock, $0.01 par
value, 200,000,000 shares authorized; 121,078,216 and 121,049,471
issued and outstanding at September 30, 2016 and December 31, 2015,
respectively |
|
1,211 |
|
|
1,210 |
|
Paid-in capital |
|
1,101,982 |
|
|
1,099,283 |
|
Accumulated
deficit |
|
(187,615 |
) |
|
(191,067 |
) |
Accumulated other
comprehensive income (loss) |
|
140 |
|
|
(197 |
) |
Total
equity |
|
915,718 |
|
|
909,229 |
|
Total
liabilities and equity |
|
$ |
1,307,910 |
|
|
$ |
1,278,389 |
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyConsolidated
Statements of Cash Flows(Unaudited)
|
|
Nine Months Ended |
|
|
September 30, |
(In thousands) |
|
2016 |
|
2015 |
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
|
Net income (loss) |
|
$ |
3,452 |
|
|
$ |
(28,160 |
) |
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities: |
|
|
|
|
Depletion, depreciation and amortization |
|
55,742 |
|
|
49,681 |
|
Gain on
sale of long-term investment |
|
(678 |
) |
|
— |
|
Loss on
long-term investments |
|
— |
|
|
204 |
|
Loss on
extinguishment of debt, net |
|
— |
|
|
4,010 |
|
Impairment of non-producing mineral properties |
|
— |
|
|
46,772 |
|
Amortization / accretion of investment premium / discount |
|
1,772 |
|
|
1,688 |
|
Gain on
disposal of property, plant and equipment |
|
(72 |
) |
|
(216 |
) |
Foreign
currency transaction gain, net |
|
(1,660 |
) |
|
(149 |
) |
Deferred
income taxes |
|
(2,103 |
) |
|
(12,192 |
) |
Accretion
of asset retirement obligation |
|
637 |
|
|
589 |
|
Amortization of deferred debt issuance costs |
|
662 |
|
|
1,665 |
|
Accretion
of convertible debenture debt discount |
|
13,297 |
|
|
12,985 |
|
Share
based compensation and other benefits |
|
2,744 |
|
|
9,489 |
|
Non-cash
capitalized interest |
|
(4,334 |
) |
|
(2,809 |
) |
Changes in operating
assets and liabilities: |
|
|
|
|
Inventories |
|
(39,067 |
) |
|
2,280 |
|
Trade
receivables |
|
(604 |
) |
|
554 |
|
Prepaid
expenses |
|
(1,805 |
) |
|
(1,674 |
) |
Accounts
payable |
|
3,048 |
|
|
413 |
|
Accrued
compensation and benefits |
|
385 |
|
|
(62 |
) |
Property,
production and franchise taxes payable |
|
1,195 |
|
|
170 |
|
Income
taxes payable |
|
648 |
|
|
— |
|
Accrued
workers compensation |
|
350 |
|
|
32 |
|
Other
operating assets |
|
351 |
|
|
(7,607 |
) |
Other
operating liabilities |
|
4,196 |
|
|
(1,982 |
) |
NET CASH
PROVIDED BY OPERATING ACTIVITIES |
|
38,156 |
|
|
75,681 |
|
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
|
Capital
expenditures |
|
(61,980 |
) |
|
(83,386 |
) |
Proceeds
from sale of long-term investment |
|
1,099 |
|
|
— |
|
Proceeds
from disposal of property, plant and equipment |
|
162 |
|
|
387 |
|
Purchases
of investments |
|
(234,269 |
) |
|
(230,392 |
) |
Proceeds
from maturities and sales of investments |
|
223,095 |
|
|
153,902 |
|
NET CASH USED
IN INVESTING ACTIVITIES |
|
(71,893 |
) |
|
(159,489 |
) |
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
|
Payments
on debt and capital lease obligations |
|
(658 |
) |
|
(62,582 |
) |
Proceeds
from issuance of common stock |
|
26 |
|
|
60 |
|
NET CASH USED
IN FINANCING ACTIVITIES |
|
(632 |
) |
|
(62,522 |
) |
CASH AND CASH
EQUIVALENTS |
|
|
|
|
Net
decrease |
|
(34,369 |
) |
|
(146,330 |
) |
Balance
at beginning of period |
|
147,336 |
|
|
280,286 |
|
BALANCE AT END
OF PERIOD |
|
$ |
112,967 |
|
|
$ |
133,956 |
|
|
|
|
|
|
|
|
|
|
Stillwater Mining Company Key
Operating Factors (Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except where noted) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
OPERATING AND
COST DATA FOR PGM MINE PRODUCTION |
|
|
|
|
|
|
|
|
Consolidated: |
|
|
|
|
|
|
|
|
Ounces produced |
|
|
|
|
|
|
|
|
Palladium |
|
|
106.9 |
|
|
|
99.0 |
|
|
|
318.4 |
|
|
|
300.5 |
|
Platinum |
|
|
31.9 |
|
|
|
29.1 |
|
|
|
94.8 |
|
|
|
87.9 |
|
Total |
|
|
138.8 |
|
|
|
128.1 |
|
|
|
413.2 |
|
|
|
388.4 |
|
Tons milled |
|
|
321.9 |
|
|
|
299.5 |
|
|
|
963.0 |
|
|
|
906.9 |
|
Mill head grade (ounce
per ton) |
|
|
0.46 |
|
|
|
0.45 |
|
|
|
0.46 |
|
|
|
0.45 |
|
Sub-grade tons milled
(1) |
|
|
23.9 |
|
|
|
33.6 |
|
|
|
66.6 |
|
|
|
88.5 |
|
Sub-grade tons mill
head grade (ounce per ton) |
|
0.15 |
|
|
0.14 |
|
|
0.15 |
|
|
0.15 |
|
Total tons
milled(1) |
|
|
345.8 |
|
|
|
333.1 |
|
|
|
1,029.6 |
|
|
|
995.4 |
|
Combined mill head
grade (ounce per ton) |
|
0.44 |
|
|
0.42 |
|
|
0.44 |
|
|
0.43 |
|
Total mill recovery
(%) |
|
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
Total mine concentrate
shipped (tons) (3) |
|
8,107 |
|
|
7,716 |
|
|
24,169 |
|
|
23,738 |
|
Platinum grade in
concentrate (ounce per ton) (3) |
|
4.19 |
|
|
3.93 |
|
|
4.19 |
|
|
3.89 |
|
Palladium grade in
concentrate (ounce per ton) (3) |
|
13.61 |
|
|
13.18 |
|
|
13.60 |
|
|
13.05 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
498 |
|
|
$ |
588 |
|
|
$ |
503 |
|
|
$ |
593 |
|
Total combined cash
costs per ounce - net of credits (Non-GAAP) (2) |
|
$ |
434 |
|
|
$ |
465 |
|
|
$ |
433 |
|
|
$ |
511 |
|
Total combined cash
costs per ore ton milled - net of credits (Non-GAAP) (2) |
|
$ |
174 |
|
|
$ |
179 |
|
|
$ |
174 |
|
|
$ |
199 |
|
Stillwater
Mine: |
|
|
|
|
|
|
|
|
Ounces produced |
|
|
|
|
|
|
|
|
Palladium |
|
|
64.3 |
|
|
|
59.3 |
|
|
|
189.9 |
|
|
|
183.0 |
|
Platinum |
|
|
19.7 |
|
|
|
17.7 |
|
|
|
58.1 |
|
|
|
54.5 |
|
Total |
|
|
84.0 |
|
|
|
77.0 |
|
|
|
248.0 |
|
|
|
237.5 |
|
Tons milled |
|
|
165.1 |
|
|
|
159.8 |
|
|
|
507.0 |
|
|
|
499.7 |
|
Mill head grade (ounce
per ton) |
|
0.54 |
|
|
0.50 |
|
|
0.52 |
|
|
0.49 |
|
Sub-grade tons milled
(1) |
|
9.2 |
|
|
22.1 |
|
|
26.0 |
|
|
57.1 |
|
Sub-grade tons mill
head grade (ounce per ton) |
|
0.22 |
|
|
0.16 |
|
|
0.23 |
|
|
0.18 |
|
Total tons milled
(1) |
|
174.3 |
|
|
181.9 |
|
|
533.0 |
|
|
556.8 |
|
Combined mill head
grade (ounce per ton) |
|
0.52 |
|
|
0.46 |
|
|
0.50 |
|
|
0.46 |
|
Total mill recovery
(%) |
|
93 |
|
|
92 |
|
|
93 |
|
|
93 |
|
Total mine concentrate
shipped (tons) (3) |
|
4,323 |
|
|
3,858 |
|
|
12,775 |
|
|
12,563 |
|
Platinum grade in
concentrate (ounce per ton) (3) |
|
5.03 |
|
|
4.91 |
|
|
5.04 |
|
|
4.68 |
|
Palladium grade in
concentrate (ounce per ton) (3) |
|
15.59 |
|
|
16.00 |
|
|
15.60 |
|
|
15.23 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
468 |
|
|
$ |
559 |
|
|
$ |
478 |
|
|
$ |
572 |
|
Total cash costs per
PGM mined ounce - net of credits (Non-GAAP) (2) |
|
$ |
434 |
|
|
$ |
441 |
|
|
$ |
428 |
|
|
$ |
507 |
|
Total cash costs per
ore ton milled - net of credits (Non-GAAP) (2) |
|
$ |
209 |
|
|
$ |
187 |
|
|
$ |
199 |
|
|
$ |
216 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyKey Operating
Factors (Continued)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except where noted) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
OPERATING AND
COST DATA FOR PGM MINE PRODUCTION (Continued) |
|
|
|
|
|
|
|
|
East Boulder
Mine: |
|
|
|
|
|
|
|
|
Ounces produced |
|
|
|
|
|
|
|
|
Palladium |
|
42.6 |
|
|
39.7 |
|
|
128.5 |
|
|
117.5 |
|
Platinum |
|
12.2 |
|
|
11.4 |
|
|
36.7 |
|
|
33.4 |
|
Total |
|
54.8 |
|
|
51.1 |
|
|
165.2 |
|
|
150.9 |
|
Tons milled |
|
156.8 |
|
|
139.7 |
|
|
456.0 |
|
|
407.2 |
|
Mill head grade (ounce
per ton) |
|
0.38 |
|
|
0.40 |
|
|
0.39 |
|
|
0.40 |
|
Sub-grade tons milled
(1) |
|
14.7 |
|
|
11.5 |
|
|
40.7 |
|
|
31.4 |
|
Sub-grade tons mill
head grade (ounce per ton) |
|
0.10 |
|
|
0.10 |
|
|
0.10 |
|
|
0.10 |
|
Total tons milled
(1) |
|
171.5 |
|
|
151.2 |
|
|
496.7 |
|
|
438.6 |
|
Combined mill head
grade (ounce per ton) |
|
0.36 |
|
|
0.38 |
|
|
0.37 |
|
|
0.38 |
|
Total mill recovery
(%) |
|
90 |
|
|
91 |
|
|
90 |
|
|
91 |
|
Total mine concentrate
shipped (tons) (3) |
|
3,784 |
|
|
3,858 |
|
|
11,394 |
|
|
11,175 |
|
Platinum grade in
concentrate (ounce per ton) (3) |
|
3.23 |
|
|
2.96 |
|
|
3.24 |
|
|
3.01 |
|
Palladium grade in
concentrate (ounce per ton) (3) |
|
11.35 |
|
|
10.36 |
|
|
11.36 |
|
|
10.59 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
544 |
|
|
$ |
635 |
|
|
$ |
542 |
|
|
$ |
630 |
|
Total cash costs per
PGM mined ounce - net of credits (Non-GAAP) (2) |
|
$ |
433 |
|
|
$ |
500 |
|
|
$ |
441 |
|
|
$ |
517 |
|
Total cash costs per
ore ton milled - net of credits (Non-GAAP) (2) |
|
$ |
138 |
|
|
$ |
169 |
|
|
$ |
147 |
|
|
$ |
178 |
|
(1) Sub-grade tons milled includes reef
waste material only. Reef waste material is PGM-bearing mined
material below the cutoff grade for proven and probable reserves
but with sufficient economic value to justify processing it through
the concentrator along with the mined ore. Total tons milled
includes ore tons and sub-grade tons only. See “Proven and Probable
Ore Reserves – Discussion” in the Company’s 2015 Annual Report on
Form 10-K for further information. |
(2) Total cash costs include total operating
costs plus royalties, insurance and taxes other than income taxes.
Total cash costs per PGM mined ounce, net of credits is a non-GAAP
financial measure that management uses to monitor and evaluate the
efficiency of its mining operations. This measure of cost is not
defined under U.S. Generally Accepted Accounting Principles (GAAP).
Please see Reconciliation of GAAP Financial Measures to Non-GAAP
Financial Measures and the accompanying discussion for additional
detail. |
(3) The concentrate tonnage and grade values
are inclusive of periodic re-processing of smelter slag and
internal furnace brick PGM bearing materials. |
|
Stillwater Mining CompanyKey Operating
Factors (Continued)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except for average prices) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
SALES AND PRICE
DATA |
|
|
|
|
|
|
|
|
Ounces
sold |
|
|
|
|
|
|
|
|
PGM Mine
Production: |
|
|
|
|
|
|
|
|
Palladium
(oz.) |
|
103.6 |
|
91.7 |
|
325.2 |
|
302.1 |
Platinum
(oz.) |
|
28.2 |
|
25.6 |
|
89.5 |
|
84.9 |
Total |
|
131.8 |
|
117.3 |
|
414.7 |
|
387.0 |
PGM Recycling: (1) |
|
|
|
|
|
|
|
|
Palladium
(oz.) |
|
69.2 |
|
53.2 |
|
160.4 |
|
136.9 |
Platinum
(oz.) |
|
40.6 |
|
29.6 |
|
87.5 |
|
78.1 |
Rhodium
(oz.) |
|
7.8 |
|
6.0 |
|
18.3 |
|
16.5 |
Total |
|
117.6 |
|
88.8 |
|
266.2 |
|
231.5 |
By-products from Mine
Production: (2) |
|
|
|
|
|
|
|
|
Rhodium
(oz.) |
|
0.9 |
|
0.8 |
|
2.5 |
|
2.7 |
Gold
(oz.) |
|
2.6 |
|
2.5 |
|
8.1 |
|
7.9 |
Silver
(oz.) |
|
2.0 |
|
1.7 |
|
5.0 |
|
5.0 |
Copper
(lb.) |
|
262.3 |
|
221.0 |
|
830.3 |
|
744.1 |
Nickel
(lb.) |
|
387.8 |
|
342.0 |
|
1,184.9 |
|
1,130.5 |
Average
realized price per ounce (3) |
|
|
|
|
|
|
|
|
PGM Mine
Production: |
|
|
|
|
|
|
|
|
Palladium
($/oz.) |
|
$ |
679 |
|
|
$ |
611 |
|
|
$ |
591 |
|
|
$ |
723 |
|
Platinum
($/oz.) |
|
$ |
1,076 |
|
|
$ |
987 |
|
|
$ |
1,001 |
|
|
$ |
1,107 |
|
Combined
($/oz.) (5) |
|
$ |
764 |
|
|
$ |
693 |
|
|
$ |
679 |
|
|
$ |
807 |
|
PGM Recycling: (1) |
|
|
|
|
|
|
|
|
Palladium
($/oz.) |
|
$ |
587 |
|
|
$ |
737 |
|
|
$ |
569 |
|
|
$ |
771 |
|
Platinum
($/oz.) |
|
$ |
1,019 |
|
|
$ |
1,111 |
|
|
$ |
967 |
|
|
$ |
1,181 |
|
Rhodium
($/oz.) |
|
$ |
671 |
|
|
$ |
1,027 |
|
|
$ |
680 |
|
|
$ |
1,130 |
|
Combined
($/oz.) (5) |
|
$ |
742 |
|
|
$ |
881 |
|
|
$ |
708 |
|
|
$ |
935 |
|
By-products from Mine
Production: (2) |
|
|
|
|
|
|
|
|
Rhodium
($/oz.) |
|
$ |
648 |
|
|
$ |
808 |
|
|
$ |
669 |
|
|
$ |
1,020 |
|
Gold
($/oz.) |
|
$ |
1,328 |
|
|
$ |
1,136 |
|
|
$ |
1,261 |
|
|
$ |
1,181 |
|
Silver
($/oz.) |
|
$ |
19 |
|
|
$ |
15 |
|
|
$ |
17 |
|
|
$ |
16 |
|
Copper
($/lb.) |
|
$ |
1.95 |
|
|
$ |
2.20 |
|
|
$ |
1.93 |
|
|
$ |
2.42 |
|
Nickel
($/lb.) |
|
$ |
3.86 |
|
|
$ |
2.92 |
|
|
$ |
3.23 |
|
|
$ |
4.20 |
|
Average market
price per ounce (4) |
|
|
|
|
|
|
|
|
Palladium
($/oz.) |
|
$ |
677 |
|
|
$ |
617 |
|
|
$ |
591 |
|
|
$ |
719 |
|
Platinum
($/oz.) |
|
$ |
1,085 |
|
|
$ |
987 |
|
|
$ |
1,003 |
|
|
$ |
1,100 |
|
Combined
($/oz.) (5) |
|
$ |
764 |
|
|
$ |
698 |
|
|
$ |
679 |
|
|
$ |
802 |
|
(1) Ounces sold and average realized price
per ounce from PGM Recycling relate to ounces produced from
processing of spent catalyst from catalytic converters and other
industrial sources. |
(2) By-product metals sold reflect net
values of realized prices (discounted due to product form) per unit
sold. |
(3) The Company’s average realized price
represents revenues, hedging gains and losses realized on commodity
instruments and agreement discounts, divided by ounces sold. |
(4) The average market price represents the
average London market for the actual months of the period. |
(5) The Company reports a combined average
realized and market price of palladium and platinum at the same
ratio as ounces that are produced from the base metal
refinery. |
|
RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP
FINANCIAL MEASURES
The Company utilizes certain non-GAAP financial measures as
indicators in assessing the performance of its mining and
processing operations during any period. Because of the processing
time required to complete the extraction of finished PGM products,
there are typically lags of one to three months between ore
production and sale of the finished product. Costs of metals sold -
Mine Production, the Company's most directly comparable GAAP
financial measure, in any period includes some portion of material
mined and processed from prior periods as the process is completed.
Consequently, while costs of metals sold - Mine Production (a GAAP
measure included in the Company’s Consolidated Statements of
Comprehensive Income (Loss)) appropriately reflects the expense
associated with the materials sold in any period, the Company has
developed certain non-GAAP financial measures to assess the costs
associated with its producing and processing activities in a
particular period and to compare those costs between periods.
While the Company believes that these non-GAAP financial
measures may also be of value to outside readers, both as general
indicators of the Company’s mining efficiency from period to period
and as insight into how the Company internally measures its
operating performance, these non-GAAP financial measures are not
standardized across the mining industry and in most cases will not
be directly comparable to similar measures that may be provided by
other companies. These non-GAAP financial measures are only useful
as indicators of relative operational performance in any period,
and because they do not take into account the inventory timing
differences that are included in costs of metals sold - Mine
Production, they cannot meaningfully be used to develop measures of
earnings or profitability. A reconciliation of these measures to
costs of metals sold - Mine Production, the most directly
comparable GAAP financial measure, for each period shown is
provided as part of the following tables, and a description of each
non-GAAP financial measure is provided below.
Costs of Metals Sold - Mine Production: For the
Company as a whole, this measure is equal to total costs of metals
sold - Mine Production, as reported in the Company's Consolidated
Statements of Comprehensive Income (Loss). For the Stillwater Mine
and the East Boulder Mine, the Company segregates the expenses
within total costs of metals sold - Mine Production that are
directly associated with each of these activities and then
allocates the remaining facility costs included in total cost of
revenues in proportion to the monthly volumes from each activity.
The resulting total costs of metals sold - Mine Production measures
for the Stillwater Mine, and the East Boulder Mine are equal, in
the aggregate, to total consolidated costs of metals sold - Mine
Production as reported in the Company’s Consolidated Statements of
Comprehensive Income (Loss).
When divided by the total PGM mined ounces sold in the
respective period, Costs of metals sold - Mine Production, measured
for each mine or combined, provides an indication of the level of
combined cash costs incurred per PGM mined ounce sold in that
period. Consequently, Total Combined Cash Costs per PGM mined ounce
sold (Non-GAAP) is a general measure of operating efficiency, and
is affected both by the level of Total Combined Cash Costs
(Non-GAAP) and by the total of PGM mined ounces sold.
Total Combined Cash Costs (Non-GAAP): This
non-GAAP financial measure is calculated as total costs of metals
sold - Mine Production adjusted for the change in mined inventories
to calculate Total Combined Cash Costs before by-product and
recycling income credits, (Non-GAAP). From this calculation, the
Company deducts by-product and recycling income credits to arrive
at Total Combined Cash Costs, net of by-product and recycling
income credits. Total Combined Cash Costs is a measure of
extraction efficiency. The Company uses this measure as a
comparative indication of the cash costs related to production and
processing in its mining operations in any period. When divided by
PGM ounces produced in the respective period, Total Combined Cash
Costs, net of by-products and recycling income credits (Non-GAAP),
measured for each mine or combined, provides an indication of the
level of combined cash costs incurred per PGM ounce produced in
that period.
When divided by the total ore tons milled in the respective
period, Total Combined Cash Costs per PGM mined ounce, net of
by-product and recycling income credits (Non-GAAP), measured for
each mine or combined, provides an indication of the level of
combined cash costs incurred per ton milled in that period. Because
of variability of ore grade in the Company’s mining operations,
production efficiency underground is frequently measured against
ore tons produced rather than contained PGM ounces. Because ore
tons are first weighed as they are fed into the mill, mill feed is
the first point at which production tons are measured precisely.
Consequently, Total Combined Cash Costs per Ore Ton Milled
(Non-GAAP) is a general measure of production efficiency, and is
affected both by the level of Total Combined Cash Costs (Non-GAAP)
and by the volume of tons produced and fed to the mill.
With respect to 2016 guidance regarding Total Cash Costs per PGM
Mined Ounce (net of by-product and recycling credits) and AISC per
PGM Mined Ounce, the Company cannot provide a quantitative
reconciliation to the most directly comparable GAAP measure without
unreasonable effort. However, the Company would expect to
calculate these non-GAAP measures in the same manner they were
calculated in the reconciliations included in this press
release.
Stillwater Mining CompanyReconciliation
of GAAP Financial Measures to Non-GAAP Financial
Measures(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except per ounce and per ton
data) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Consolidated: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of metals sold -
Mine Production |
|
$ |
65,580 |
|
|
$ |
69,004 |
|
|
$ |
208,612 |
|
|
$ |
229,676 |
|
Change in mined
inventories (palladium and platinum) |
|
4,652 |
|
|
(1,256 |
) |
|
(3,568 |
) |
|
(5,261 |
) |
Total combined cash
costs, before by-product and recycling credits
(Non-GAAP) |
|
$ |
70,232 |
|
|
$ |
67,748 |
|
|
$ |
205,044 |
|
|
$ |
224,415 |
|
By-product revenue
credit |
|
(6,116 |
) |
|
(5,004 |
) |
|
(17,378 |
) |
|
(18,663 |
) |
PGM Recycling income
credit |
|
(3,876 |
) |
|
(3,261 |
) |
|
(8,611 |
) |
|
(7,424 |
) |
Total combined cash
costs, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
60,240 |
|
|
$ |
59,483 |
|
|
$ |
179,055 |
|
|
$ |
198,328 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
sold |
|
|
131.8 |
|
|
|
117.3 |
|
|
|
414.7 |
|
|
|
387.0 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
498 |
|
|
$ |
588 |
|
|
$ |
503 |
|
|
$ |
593 |
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
produced |
|
138.8 |
|
|
128.1 |
|
|
413.2 |
|
|
388.4 |
|
|
|
|
|
|
|
|
|
|
Total combined cash
costs per PGM mined ounce, before by-product and recycling
credits (Non-GAAP) |
|
$ |
506 |
|
|
$ |
529 |
|
|
$ |
496 |
|
|
$ |
578 |
|
By-product credit per
mined ounce |
|
(44 |
) |
|
(39 |
) |
|
(42 |
) |
|
(48 |
) |
Recycling income credit
per mined ounce |
|
(28 |
) |
|
(25 |
) |
|
(21 |
) |
|
(19 |
) |
Total combined cash
costs PGM per mined ounce, net of by-product and recycling
credits (Non-GAAP) |
|
$ |
434 |
|
|
$ |
465 |
|
|
$ |
433 |
|
|
$ |
511 |
|
|
|
|
|
|
|
|
|
|
Ore tons milled |
|
345.8 |
|
|
333.1 |
|
|
1,029.6 |
|
|
995.4 |
|
|
|
|
|
|
|
|
|
|
Total combined cash
costs per ore ton milled, before by-product and recycling credits
(Non-GAAP) |
|
$ |
203 |
|
|
$ |
204 |
|
|
$ |
199 |
|
|
$ |
225 |
|
By-product credit per
ore ton milled |
|
(18 |
) |
|
(15 |
) |
|
(17 |
) |
|
(19 |
) |
Recycling income credit
per ore ton milled |
|
(11 |
) |
|
(10 |
) |
|
(8 |
) |
|
(7 |
) |
Total combined cash
costs per ore ton milled, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
174 |
|
|
$ |
179 |
|
|
$ |
174 |
|
|
$ |
199 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyReconciliation
of GAAP Financial Measures to Non-GAAP Financial Measures
(Continued)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except per ounce and per ton
data) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Stillwater
Mine: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of metals sold -
Mine Production |
|
$ |
37,943 |
|
|
$ |
40,290 |
|
|
$ |
122,002 |
|
|
$ |
140,053 |
|
Change in mined
inventories (palladium and platinum) |
|
4,057 |
|
|
(1,770 |
) |
|
(1,608 |
) |
|
(5,068 |
) |
Total cash costs,
before by-product and recycling credits (Non-GAAP) |
|
$ |
42,000 |
|
|
$ |
38,520 |
|
|
$ |
120,394 |
|
|
$ |
134,985 |
|
By-product revenue
credit |
|
(3,166 |
) |
|
(2,599 |
) |
|
(9,054 |
) |
|
(10,131 |
) |
PGM Recycling income
credit |
|
(2,342 |
) |
|
(1,939 |
) |
|
(5,160 |
) |
|
(4,479 |
) |
Total cash costs, net
of by-product and recycling credits (Non-GAAP) |
|
$ |
36,492 |
|
|
$ |
33,982 |
|
|
$ |
106,180 |
|
|
$ |
120,375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
sold |
|
|
81.1 |
|
|
|
72.1 |
|
|
|
255.0 |
|
|
|
244.8 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
468 |
|
|
$ |
559 |
|
|
$ |
478 |
|
|
$ |
572 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
produced |
|
|
84.0 |
|
|
|
77.0 |
|
|
|
248.0 |
|
|
|
237.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash costs per
PGM mined ounce, before by-product and recycling credits
(Non-GAAP) |
|
$ |
500 |
|
|
$ |
500 |
|
|
$ |
486 |
|
|
$ |
569 |
|
By-product credit per
mined ounce |
|
(38 |
) |
|
(34 |
) |
|
(37 |
) |
|
(43 |
) |
Recycling income credit
per mined ounce |
|
(28 |
) |
|
(25 |
) |
|
(21 |
) |
|
(19 |
) |
Total cash costs per
PGM mined ounce, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
434 |
|
|
$ |
441 |
|
|
$ |
428 |
|
|
$ |
507 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ore tons milled |
|
|
174.3 |
|
|
|
181.9 |
|
|
|
533.0 |
|
|
|
556.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash costs per
ore ton milled, before by-product and recycling credits
(Non-GAAP) |
|
$ |
240 |
|
|
$ |
212 |
|
|
$ |
226 |
|
|
$ |
242 |
|
By-product credit per
ore ton milled |
|
(18 |
) |
|
(14 |
) |
|
(17 |
) |
|
(18 |
) |
Recycling income credit
per ore ton milled |
|
(13 |
) |
|
(11 |
) |
|
(10 |
) |
|
(8 |
) |
Total cash costs per
ore ton milled, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
209 |
|
|
$ |
187 |
|
|
$ |
199 |
|
|
$ |
216 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyReconciliation
of GAAP Financial Measures to Non-GAAP Financial Measures
(Continued)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except per ounce and per ton
data) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
East Boulder
Mine: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of metals sold -
Mine Production |
|
$ |
27,637 |
|
|
$ |
28,714 |
|
|
$ |
86,610 |
|
|
$ |
89,623 |
|
Change in mined
inventories (palladium and platinum) |
|
595 |
|
|
514 |
|
|
(1,960 |
) |
|
(193 |
) |
Total cash costs,
before by-product and recycling credits (Non-GAAP) |
|
$ |
28,232 |
|
|
$ |
29,228 |
|
|
$ |
84,650 |
|
|
$ |
89,430 |
|
By-product revenue
credit |
|
(2,950 |
) |
|
(2,405 |
) |
|
(8,324 |
) |
|
(8,532 |
) |
PGM Recycling income
credit |
|
(1,534 |
) |
|
(1,322 |
) |
|
(3,451 |
) |
|
(2,945 |
) |
Total cash costs, net
of by-product and recycling credits (Non-GAAP) |
|
$ |
23,748 |
|
|
$ |
25,501 |
|
|
$ |
72,875 |
|
|
$ |
77,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
sold |
|
|
50.8 |
|
|
|
45.2 |
|
|
|
159.7 |
|
|
|
142.2 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
544 |
|
|
$ |
635 |
|
|
$ |
542 |
|
|
$ |
630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
produced |
|
|
54.8 |
|
|
|
51.1 |
|
|
|
165.2 |
|
|
|
150.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash costs per
PGM mined ounce, before by-product and recycling credits
(Non-GAAP) |
|
$ |
515 |
|
|
$ |
573 |
|
|
$ |
512 |
|
|
$ |
594 |
|
By-product credit per
mined ounce |
|
(54 |
) |
|
(47 |
) |
|
(50 |
) |
|
(57 |
) |
Recycling income credit
per mined ounce |
|
(28 |
) |
|
(26 |
) |
|
(21 |
) |
|
(20 |
) |
Total cash cost, per
PGM mined ounce, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
433 |
|
|
$ |
500 |
|
|
$ |
441 |
|
|
$ |
517 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ore tons milled |
|
|
171.5 |
|
|
|
151.2 |
|
|
|
496.7 |
|
|
|
438.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash costs per
ore ton milled, before by-product and recycling credits
(Non-GAAP) |
|
$ |
164 |
|
|
$ |
194 |
|
|
$ |
171 |
|
|
$ |
204 |
|
By-product credit per
ore ton milled |
|
(17 |
) |
|
(16 |
) |
|
(17 |
) |
|
(19 |
) |
Recycling income credit
per ore ton milled |
|
(9 |
) |
|
(9 |
) |
|
(7 |
) |
|
(7 |
) |
Total cash costs per
ore ton milled, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
138 |
|
|
$ |
169 |
|
|
$ |
147 |
|
|
$ |
178 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyAll-In
Sustaining Costs (a Non-GAAP Financial
Measure)(Unaudited)
All-In Sustaining Costs (Non-GAAP): This
non-GAAP financial measure is used as an indicator from period to
period of the level of total cash required by the Company to
maintain and operate the existing mines, including corporate
administrative costs and replacement capital. The measure is
calculated beginning with Costs of metal sold - Mine Production,
the Company's most directly comparable GAAP financial measure and
adding to it the change in mined inventories, and adjusting for the
by-product and recycling income credits, domestic corporate general
and administrative costs (excluding any depreciation and general
and administrative costs of foreign subsidiaries) and that portion
of total capital expenditures associated with sustaining the
current level of mining operations. Capital expenditures, however,
for Blitz and certain other one-time projects are not included in
the calculation.
When divided by the total recoverable PGM mined ounces produced
in the respective period, All-In Sustaining Costs per PGM Mined
Ounce Produced (Non-GAAP) provides an indication of the level of
total cash required to maintain and operate the mines per PGM ounce
produced in the period. Recoverable PGM ounces from production are
an indication of the amount of PGM product extracted through mining
in any period. Because the objective of PGM mining activity is to
extract PGM material, the all-in cash costs per PGM mined ounce to
produce PGM material, administer the business and sustain the
operating capacity of the mines is a useful measure for comparing
overall extraction efficiency between periods. This measure is
affected by the total level of spending in the period and by the
grade and volume of mined ore produced.
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In thousands, except $/oz.) |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
All-In
Sustaining Costs |
|
|
|
|
|
|
|
|
Costs of metals sold -
Mine Production |
|
$ |
65,580 |
|
|
$ |
69,004 |
|
|
$ |
208,612 |
|
|
$ |
229,676 |
|
Change in mined
inventories (palladium and platinum) |
|
4,652 |
|
|
(1,256 |
) |
|
(3,568 |
) |
|
(5,261 |
) |
Total combined cash
costs, before by-product and recycling credits
(Non-GAAP) |
|
$ |
70,232 |
|
|
$ |
67,748 |
|
|
$ |
205,044 |
|
|
$ |
224,415 |
|
By-product revenue
credit |
|
(6,116 |
) |
|
(5,004 |
) |
|
(17,378 |
) |
|
(18,663 |
) |
PGM Recycling income
credit |
|
(3,876 |
) |
|
(3,261 |
) |
|
(8,611 |
) |
|
(7,424 |
) |
Total combined cash
costs, net of by-product and recycling credits
(Non-GAAP) |
|
$ |
60,240 |
|
|
$ |
59,483 |
|
|
$ |
179,055 |
|
|
$ |
198,328 |
|
PGM Recycling income
credit |
|
3,876 |
|
|
3,261 |
|
|
8,611 |
|
|
7,424 |
|
Total combined cash
costs, net of by-product credit (Non-GAAP) |
|
$ |
64,116 |
|
|
$ |
62,744 |
|
|
$ |
187,666 |
|
|
$ |
205,752 |
|
|
|
|
|
|
|
|
|
|
Consolidated corporate
general and administrative costs |
|
$ |
8,692 |
|
|
$ |
8,911 |
|
|
$ |
25,300 |
|
|
$ |
27,652 |
|
Corporate depreciation
included in consolidated corporate general and administrative
costs |
|
(93 |
) |
|
(125 |
) |
|
(303 |
) |
|
(377 |
) |
General and
administrative costs - foreign subsidiaries |
|
(585 |
) |
|
(375 |
) |
|
(1,607 |
) |
|
(1,244 |
) |
Total general and
administrative costs |
|
$ |
8,014 |
|
|
$ |
8,411 |
|
|
$ |
23,390 |
|
|
$ |
26,031 |
|
|
|
|
|
|
|
|
|
|
Total capitalized
costs |
|
$ |
26,730 |
|
|
$ |
27,142 |
|
|
$ |
72,495 |
|
|
$ |
88,319 |
|
Capital associated with
expansion |
|
(12,198 |
) |
|
(11,610 |
) |
|
(31,909 |
) |
|
(31,953 |
) |
Total Capital incurred
to sustain existing operations |
|
$ |
14,532 |
|
|
$ |
15,532 |
|
|
$ |
40,586 |
|
|
$ |
56,366 |
|
|
|
|
|
|
|
|
|
|
All-In Sustaining
Costs (Non-GAAP) |
|
$ |
86,662 |
|
|
$ |
86,687 |
|
|
$ |
251,642 |
|
|
$ |
288,149 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PGM mined ounces
sold |
|
|
131.8 |
|
|
|
117.3 |
|
|
|
414.7 |
|
|
|
387.0 |
|
PGM mined ounces
produced |
|
138.8 |
|
|
128.1 |
|
|
413.2 |
|
|
388.4 |
|
|
|
|
|
|
|
|
|
|
Costs of metals sold
per PGM mined ounce |
|
$ |
498 |
|
|
$ |
588 |
|
|
$ |
503 |
|
|
$ |
593 |
|
All-In Sustaining Costs
per PGM Mined Ounce Produced (Non-GAAP) |
|
$ |
624 |
|
|
$ |
677 |
|
|
$ |
609 |
|
|
$ |
742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyReconciliation
of Total Cash Costs Guidance and AISC
Guidance(Non-GAAP Financial
Measures)(Unaudited)
A reconciliation of the 2016 Total Cash Costs Guidance and the
2016 AISC Guidance is provided below. The estimates in the table
below are considered "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and section 21E of the Securities Exchange Act of 1934, as amended,
which are intended to be covered by the safe harbor created by such
sections and other applicable laws. Please refer to: Cautionary
Note Concerning Forward-Looking Statements, for additional
information.
|
|
Reconciliation |
|
Guidance Range |
Costs of metals sold -
Mined Production (000's) |
|
$ |
279,125 |
|
|
|
PGM mined ounces
sold |
|
550,000 |
|
|
545,000 |
|
555,000 |
|
Costs of metals sold
per PGM mined ounce |
|
$ |
508 |
|
|
$ |
495 |
|
$ |
520 |
|
|
|
|
|
|
|
Costs of metals sold -
Mined Production (000's) |
|
$ |
279,063 |
|
|
|
|
Inventory change
(000's) |
|
(10,000 |
) |
|
|
|
Total combined cash
costs, before by-product credits and recycling credits (000's) |
|
$ |
269,063 |
|
|
|
|
PGM mined ounces |
|
540,000 |
|
|
535,000 |
|
545,000 |
|
Total combined cash
costs per PGM mined ounce, before by-product credits and recycling
credits |
|
$ |
498 |
|
|
|
|
|
|
|
|
|
|
By-product revenue
credit (000's) |
|
$ |
24,000 |
|
|
|
|
PGM Recycling income
credit (000's) |
|
11,000 |
|
|
|
|
Total cash costs, net
of by-product and recycling credits (000's) |
|
$ |
234,063 |
|
|
|
|
|
|
|
|
|
|
Total cash costs per
PGM mined ounce, net of by-product and recycling credits |
|
$ |
433 |
|
|
$ |
430 |
|
$ |
455 |
|
|
|
|
|
|
|
Total cash costs, net
of by-product and recycling credits (000's) |
|
$ |
234,063 |
|
|
|
|
PGM Recycling income
credit (000's) |
|
11,000 |
|
|
|
|
General and
administrative (000's) |
|
35,000 |
|
|
30,000 |
|
40,000 |
|
Sustaining capital
expenditures (000's) |
|
55,000 |
|
|
50,000 |
|
60,000 |
|
All-in sustaining costs
(000's) |
|
$ |
335,063 |
|
|
|
|
All-in sustaining costs
per PGM mined ounce produced |
|
$ |
620 |
|
|
$ |
595 |
|
$ |
635 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Stillwater Mining CompanyUnderlying
Earnings (Loss)(Non-GAAP Financial
Measure)(Unaudited)
Underlying Earnings (Loss) (Non-GAAP): This
non-GAAP financial measure is considered by the Company to be
reflective of the actual income / loss position. This non-GAAP
financial measure provides to investors and analysts the ability to
understand the results of the continuing operations of the Company
relating to the production, processing and sale of PGMs, by
excluding certain items that have a disproportionate impact on the
results for the reported periods. The measure is calculated
beginning with Net income (loss) attributable to common
stockholders and adding back impairment charges, one-time event
charges and charges infrequent to the Company's continuing
operations and the income tax effect of such adjustments. Net loss
attributable to noncontrolling interest has been adjusted for the
noncontrolling interest's ownership percentage of any applicable
impairment charges to which the noncontrolling interest has an
ownership. The Company's determination of the components of
Underlying earnings (loss) are evaluated periodically and based, in
part, on a review of non-GAAP financial measures used by mining
industry analysts.
Net income (loss) attributable to common stockholders is
reconciled to Adjusted net income (loss) attributable to common
stockholders and Underlying earnings (loss) as follows:
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
(In
thousands) |
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
Net
income (loss) attributable to common stockholders |
|
$ |
12,599 |
|
|
$ |
(11,878 |
) |
|
$ |
3,452 |
|
|
$ |
(16,352 |
) |
Impairment of property, plant and equipment and non-producing
mineral properties |
|
— |
|
|
— |
|
|
— |
|
|
46,772 |
|
Income
tax effect of adjustment |
|
— |
|
|
— |
|
|
— |
|
|
(997 |
) |
Reorganization, net of tax |
|
— |
|
|
1,078 |
|
|
— |
|
|
1,078 |
|
Loss on
extinguishment of debt, net of tax |
|
— |
|
|
2,606 |
|
|
— |
|
|
2,606 |
|
Adjusted net income
(loss) attributable to common stockholders (Non-GAAP) |
|
$ |
12,599 |
|
|
$ |
(8,194 |
) |
|
$ |
3,452 |
|
|
$ |
33,107 |
|
Impairment loss attributable to noncontrolling interest |
|
— |
|
|
151 |
|
|
— |
|
|
11,808 |
|
Underlying earnings
(loss) (Non-GAAP) |
|
$ |
12,599 |
|
|
$ |
(8,043 |
) |
|
$ |
3,452 |
|
|
$ |
44,915 |
|
INVESTOR CONTACT:
Mike Beckstead
(720) 502-7671
investor-relations@stillwatermining.com
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