CDE Coeur Mining Inc

-- HIGHLIGHTS -- COEUR D'ALENE, Idaho, Aug. 1 /PRNewswire-FirstCall/ -- Coeur d'Alene Mines Corporation (NYSE:CDENYSE:TSX:NYSE:CDM) today reported all-time record quarterly net income of $32.6 million, or $0.11 per diluted share, for the second quarter of 2006, compared to a net loss of $1.7 million, or $0.01 per diluted share, for the year-ago period. Cash provided by operations was an all-time quarterly record of $32.0 million, compared to $9.1 million of cash used by operations in the year-ago quarter. Results for the second quarter of 2006 include the favorable impact of the company's strategic sale of 100% of the shares of Coeur Silver Valley (CSV), specifically a one-time pre-tax gain of $11.2 million. The quarter also includes pre-tax income of $1.4 million from CSV operations at the Galena mine. Excluding the one-time gain and the income from Galena, the company's net income in the second quarter of 2006 was still a record $20.1 million, or $0.07 per diluted share. For the first six months of 2006, the company reported record net income of $47.0 million, or $0.16 per diluted share, compared to a net loss of $2.8 million, or $0.01 per share, for the same period of 2005. Excluding the one- time gain mentioned above and $2.0 million of pretax income from discontinued operations, the company's net income for the first six months of 2006 was still a record $33.9 million, or $0.12 per diluted share. Metal sales from continuing operations in the second quarter of 2006 increased 61 percent to $54.0 million from $33.5 million in the year-ago quarter. Metal sales from continuing operations for the first six months of 2006 increased 50 percent to $98.9 million from $65.7 million in the year-ago period. In commenting on the company's performance relative to the year-ago quarter, Dennis E. Wheeler, Chairman, President and Chief Executive Officer, said, "The company's operating performance improved sharply due to improvement in nearly all of our key business indicators. Specifically, the company reported higher silver production, lower per-ounce cash production costs for silver, and sharply higher realized prices for silver and gold." Wheeler added, "During the quarter, we completed the profitable sale of our interest in Coeur Silver Valley as part of our strategy to focus our growth on lower cost, longer-life mines. That transaction generated $15 million in cash for the company. At the same time, by eliminating the highest-cost mine in our system, where silver cash production costs were recently running above $10 per ounce, the transaction contributed to a significant reduction in the company's overall per-ounce silver cash production cost. We are pleased that we not only met our strategic objective with this sale but that we also reported an increase in silver production from continuing operations due largely to strong performance at Cerro Bayo combined with the ounces generated by our Australian interests." Wheeler said, "Gold and silver prices have remained at the kind of robust levels that enable the company to generate healthy income and cash flow. Our bullish view of the precious metals markets remains unchanged. Growth in silver demand appears to be particularly robust in the industrial sector, and we expect healthy price levels to continue. At the same time, we are counting on strong operating performance by our mines in the second half of the year and expect to see silver production at noticeably higher levels than in the first half, with the Cerro Bayo and Rochester mines, in particular, setting the pace." Highlights by Individual Property -- Rochester (Nevada) -- Silver cash cost per ounce declined by 66 percent, relative to the year-ago quarter, due to a 27 percent increase in gold production. Silver production was down modestly due to the short-term impact of heavy rains that affected silver in the solution flow. -- Cerro Bayo (Chile) -- Silver production was 53 percent above the level of the first quarter of 2006 as grades returned to more typical levels as planned. At $1.82, silver cash cost per ounce in the second quarter of 2006 was the lowest in the Coeur system and was significantly below that reported for the first quarter of 2006 due largely to higher silver production. Silver production was 14 percent above that of a year ago due to an increase in tons milled. Gold production declined relative to the year-ago period due to lower grades. Lower gold production resulted in a reduced by-product credit, which caused silver cash cost per ounce to increase relative to the year-ago quarter. -- Martha (Argentina) -- Silver and gold production were above the levels of the year-ago quarter -- and sharply above the levels of the first quarter of 2006 -- primarily because the operation encountered grades for both metals that were much higher than forecast in the mine plan. Silver cash cost per ounce increased relative to the year-ago period due to higher royalties resulting from higher market prices. -- Endeavor (Australia) -- Silver production was above the level of the second quarter of 2005 because year-ago results reflected only one month of production data following Coeur's acquisition of this interest in June of 2005. Production rates at Endeavor have not yet returned to expected quarterly levels as the mine continues to recover from a rock fall that occurred in October 2005. Coeur currently expects production levels to return to normal levels during the fourth quarter of 2006. Cash production cost in the second quarter of 2006 was above the level of a year ago due to higher smelting and refining charges associated with the increased market value of silver deductions charged pursuant to the smelting and refining contracts. -- Broken Hill (Australia) -- Silver production was 528,041 ounces, with a cash cost per ounce of $3.27. Cash production cost per ounce was above the level of the preceding quarter due to higher refining and smelting charges associated with the increased market value of silver deductions charged pursuant to the smelting and refining contracts. (Year-ago comparisons for Broken Hill are not meaningful because the mineral interest was acquired in the third quarter of 2005.) In addition, at Broken Hill, proven and probable silver mineral reserve ounces increased 20 percent to 18.0 million contained ounces as of June 2006 from 15.0 million contained ounces at year-end 2005. Balance Sheet and Capital Investment Highlights The company had $393.3 million in cash and short-term investments as of June 30, 2006. Capital investment during the second quarter of 2006 totaled $25.7 million, most of which was spent on the Kensington (Alaska) gold project. -- At Kensington, capital investment totaled $20.9 million during the quarter as the company continued with an aggressive construction schedule. The company is aiming to complete the project and start producing gold near the end of 2007. Recent activity has focused on construction of the mill building and completion of major earthworks. Kensington is expected to produce 100,000 ounces of gold annually. -- At San Bartolome, capital investment totaled $1.5 million during the quarter. The company is aiming to complete construction activities near the end of 2007. During the second quarter, the construction activities continued to focus on rough-cut grading of the plant site and construction of roads. Coeur has been pleased by the recent cooperative and productive actions of the Government of Bolivia. In particular, the company recently completed renegotiation of a contract with the Bolivian State Mining Company (COMIBOL) concerning timing of lease payments; entered into an agreement with COMIBOL that calls for joint exploration of certain COMIBOL silver properties in Potosi; and received a letter of assurance from the Minister of Mines regarding the government's support for the San Bartolome project. Based on such developments, Coeur is proceeding with engineering and procurement activities. San Bartolome is expected to produce 8 million ounces of silver annually. Exploration During the second quarter, the company acquired two new exploration properties in the Santa Cruz province near the company's Martha mine via option-to-purchase agreements with private Argentinean interests. The largest is the Costa property, at 98,500 acres, which lies about 90 miles north- northwest of Martha. The second property, called El Aguila, is located in the eastern part of the province approximately 90 miles north of the town of San Julian. The company has commenced exploration activities at both properties. In the second quarter, the exploration program focused primarily on existing properties, with an emphasis on reserve development/delineation drilling and discovery of new mineralization at Cerro Bayo, Martha, and Kensington. Approximate drilling totals were 62,000 feet at Cerro Bayo, 17,000 feet at Martha, and 23,000 feet at Kensington. Coeur d'Alene Mines Corporation is one of the world's leading primary silver producers and has a strong presence in gold. The company has mining interests in Alaska, Argentina, Australia, Bolivia, Chile, and Nevada. Conference Call Information Coeur d'Alene Mines Corporation will hold a conference call to discuss the Company's second quarter 2006 results at 1 p.m. Eastern time on August 1, 2006. To listen live via telephone, call 877-704-5378 (US and Canada) or 913-312-1292 (International). The conference call and presentation will also be web cast on the Company's web site http://www.coeur.com/. A replay of the call will be available through August 7, 2006. The replay dial-in numbers are 888-203-1112 (US and Canada) and 719-457-0820 (International) and the access code is 6631943. Cautionary Statement Company press releases may contain numerous forward-looking statements within the meaning of securities legislation in the United States and Canada relating to the Company's silver and gold mining business. Such statements are subject to numerous assumptions and uncertainties, many of which are outside the Company's control. Operating, exploration and financial data, and other statements in this document are based on information the Company believes reasonable, but involve significant uncertainties as to future gold and silver prices, costs, ore grades, estimation of gold and silver reserves, mining and processing conditions, construction schedules, currency exchange rates, and the completion and/or updating of mining feasibility studies, changes that could result from the Company's future acquisition of new mining properties or businesses, the risks and hazards inherent in the mining business (including environmental hazards, industrial accidents, weather or geologically related conditions), regulatory and permitting matters, risks inherent in the ownership and operation of, or investment in, mining properties or businesses in foreign countries, as well as other uncertainties and risk factors set out in the Company's filings from time to time with the SEC and the Ontario Securities Commission, including, without limitation, the Company's reports on Form 10-K and Form 10-Q. Actual results and timetables could vary significantly from the estimates presented. Readers are cautioned not to put undue reliance on forward-looking statements. The Company disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise. The definitions of proven and probable mineral reserves under Canadian National Instrument 43-101 are substantially identical to the definitions of such reserves under Guide 7 of the SEC's Securities Act Industry Guides. Donald J. Birak, Coeur's Senior Vice President of Exploration, is the qualified person responsible for the preparation of the scientific and technical information in this document. Mr. Birak has reviewed the available data and procedures and believes the collection of exploration data and calculation of mineral reserves reported in this document was conducted in a professional and competent manner. For a description of the key assumptions, parameters and methods used to estimate the Broken Hill mineral reserves, as well as a general discussion of the extent to which the estimate may be affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant factors, please see the Broken Hill Mine Technical Report dated October 7, 2005 and filed on SEDAR at http://www.sedar.com/. Contact: Scott Lamb 208-665-0777 Broken Hill Mineral Reserves Short Silver Grade Silver Ounces Tons Ounces/ton Contained (000s) (000s) June 30, 2006 Proven 10,065 1.46 14,651 Probable 2,842 1.18 3,365 Total 12,907 1.40 18,016 Mineral Reserves at June 30, 2006; Metal prices; $0.907/pound of zinc and $0.408/pound of lead Cut-off grade; 8% combined lead and zinc for the North Mine. 7% combined lead and zinc for all other deposits. Year-end 2005 Proven 8,522 1.31 11,134 Probable 2,998 1.27 3,822 Total 11,520 1.30 14,956 COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) Three Months Six Months Ended June 30, Ended June 30, 2006 2005 2006 2005 REVENUES (In thousands except per share data) Sales of metal $54,041 $33,504 $98,895 $65,739 COSTS and Expenses Production costs applicable to sales 21,587 18,811 41,687 36,153 Depreciation and depletion 6,989 4,372 13,307 8,521 Administrative and general 4,528 5,156 9,618 10,705 Exploration 1,934 2,896 3,901 5,605 Pre-development -- 3,718 -- 6,086 Litigation settlements 469 -- 469 1,600 Total cost and expenses 35,507 34,953 68,982 68,670 OTHER INCOME AND EXPENSE Interest and other income 4,794 1,335 7,314 3,284 Interest expense, net of capitalized interest (367) (562) (888) (1,132) Total other income and expense 4,427 773 6,426 2,152 Income (loss) from continuing operations before income taxes 22,961 (676) 36,339 (781) Income tax benefit (provision) (2,829) 147 (2,481) (532) Income (loss) from continuing operations 20,132 (529) 33,858 (1,313) Income (loss) from discontinued operations, net of income taxes 1,357 (1,172) 1,968 (1,533) Gain on sale of net assets of discontinued operations 11,159 -- 11,159 -- NET INCOME (LOSS) 32,648 (1,701) 46,985 (2,846) Other comprehensive income (loss) 1,736 121 1,740 120 COMPREHENSIVE INCOME (LOSS) $34,384 $(1,580) $48,725 $(2,726) BASIC AND DILUTED INCOME (LOSS) PER SHARE Basic income (loss) per share: Income (loss) from continuing operations $0.07 $(0.00) $0.13 $(0.00) Income (loss) from discontinued operations 0.05 (0.01) 0.05 (0.01) Net income (loss) $0.12 $(0.01) $0.18 $(0.01) Diluted income (loss) per share: Income (loss) from continuing operations $0.07 $(0.00) $0.12 $(0.00) Income (loss) from discontinued operations 0.04 (0.01) 0.04 (0.01) Net income (loss) $0.11 $(0.01) $0.16 $(0.01) Weighted average number of shares of common stock Basic 277,474 240,028 265,049 240,007 Diluted 302,188 240,028 289,832 240,007 Operating Statistics From Continuing Operations The following table presents information by mine and consolidated sales information for the three- and six-month periods ended June 30, 2006 and 2005: Three Months Ended Six Months Ended June 30, June 30, 2006 2005 2006 2005 Rochester Tons processed 2,737,547 2,293,621 5,269,447 4,652,034 Ore grade/Ag oz 0.76 1.09 0.72 1.00 Ore grade/Au oz .009 .010 .011 .010 Recovery/Ag oz (A) 55.5% 48.5% 60.9% 50.5% Recovery/Au oz (A) 75.1% 63.4% 58.3% 62.8% Silver production ounces 1,153,295 1,208,584 2,301,658 2,344,581 Gold production ounces 18,265 14,412 34,382 28,404 Cash cost/oz $2.61 $7.58 $3.46 $6.96 Total cost/oz $5.80 $9.93 $6.70 $9.25 Cerro Bayo Tons milled 115,361 92,666 215,636 191,250 Ore grade/Ag oz 7.20 7.80 6.43 7.41 Ore grade/Au oz .094 .174 .094 .168 Recovery/Ag oz 95.1% 95.7% 94.2% 95.3% Recovery/Au oz 92.1% 93.4% 92.1% 93.1% Silver production ounces 789,746 691,846 1,305,568 1,351,139 Gold production ounces 9,935 15,100 18,729 29,967 Cash cost/oz $1.82 $0.76 $2.47 $0.31 Total cost/oz $3.77 $2.28 $4.63 $2.03 Martha Mine Tons milled 6,817 8,915 15,666 16,753 Ore grade/Ag oz 97.79 70.82 79.75 61.54 Ore grade/Au oz .134 .088 .105 .077 Recovery/Ag oz 95.0% 96.0% 94.2% 95.6% Recovery/Au oz 91.8% 94.0% 92.0% 93.5% Silver production ounces 633,014 606,121 1,176,500 985,181 Gold production ounces 839 735 1,509 1,206 Cash cost/oz $5.14 $4.43 $5.04 $4.68 Total cost/oz $5.61 $4.78 $5.50 $5.07 Endeavor (B) Tons milled 118,775 53,069 221,778 53,069 Ore grade/Ag oz 1.11 1.46 1.20 1.46 Recovery/Ag oz 61.3% 75.5% 62.1% 75.5% Silver production ounces 80,890 58,464 165,170 58,464 Cash cost/oz $2.79 $1.89 $2.45 $1.89 Total cost/oz $4.09 $3.13 $3.75 $3.13 Broken Hill (B) Tons milled 525,888 -- 1,106,911 -- Ore grade/Ag oz 1.32 -- 1.35 -- Recovery/Ag oz 75.8% -- 72.2% -- Silver production ounces 528,041 -- 1,085,353 -- Cash cost/oz $3.27 -- $3.07 -- Total cost/oz $6.02 -- $5.82 -- CONSOLIDATED PRODUCTION TOTALS Silver ounces 3,184,986 2,565,015 6,034,249 4,739,365 Gold ounces 29,039 30,247 54,620 57,577 Cash cost per oz/silver $3.03 $4.87 $3.46 $4.53 Total cost/oz $5.25 $6.50 $5.78 $6.25 CONSOLIDATED SALES TOTALS Silver ounces sold 3,249,854 2,881,145 6,127,744 5,534,242 Gold ounces sold 29,157 34,029 54,891 69,213 Realized price per silver ounce $13.10 $7.25 $11.82 $7.05 Realized price per gold ounce $649 $431 $620 $427 (A) The leach cycle at Rochester requires 5 to 10 years to recover gold and silver contained in the ore. The Company estimates the ultimate recovery to be approximately 61.5% for silver and 93% for gold. However, ultimate recoveries will not be known until leaching operations cease which is currently estimated for 2011. Current recovery may vary significantly from ultimate recovery. See Critical Accounting Policies and Estimates - Ore on Leach Pad. (B) The Company acquired its interests in the Endeavor and Broken Hill mines in May 2005 and September 2005, respectively. Operating Statistics From Discontinued Operation The following table presents information for Coeur Silver Valley, which was sold on June 1, 2006: Three Months Ended Six Months Ended June 30, June 30, 2006 2005 2006 2005 Silver Valley/Galena Tons milled 20,224 35,933 52,876 73,391 Ore grade/Silver oz 13.92 16.01 15.15 17.79 Recovery/Silver oz 95.6% 97.3% 96.0% 97.3% Silver production ounces 269,027 559,700 768,674 1,269,996 Cash cost/oz $10.72 $8.05 $9.75 $7.32 Total cost/oz $11.04 $8.95 $10.64 $8.11 Gold production 58 54 180 145 "Cash Costs per Ounce" are calculated by dividing the cash costs computed for each of the Company's mining properties for a specified period by the amount of gold ounces or silver ounces produced by that property during that same period. Management uses cash costs per ounce as a key indicator of the profitability of each of its mining properties. Gold and silver are sold and priced in the world financial markets on a US dollar per ounce basis. "Cash Costs" are costs directly related to the physical activities of producing silver and gold, and include mining, processing and other plant costs, third-party refining and smelting costs, marketing expense, on-site general and administrative costs, royalties, in-mine drilling expenditures that are related to production and other direct costs. Sales of by-product metals are deducted from the above in computing cash costs. Cash costs exclude depreciation, depletion and amortization, corporate general and administrative expense, exploration, interest, and pre-feasibility costs and accruals for mine reclamation. Cash costs are calculated and presented using the "Gold Institute Production Cost Standard" applied consistently for all periods presented. Total cash costs per ounce is a non-GAAP measurement and investors are cautioned not to place undue reliance on it and are urged to read all GAAP accounting disclosures presented in the consolidated financial statements and accompanying footnotes. In addition, see the reconciliation of "cash costs" to production costs under "Reconciliation of Non-GAAP Cash Costs to GAAP Production Costs" set forth below. Reconciliation of Non-GAAP Cash Costs to GAAP Production Costs The tables below present reconciliations between Non-GAAP cash costs per ounce to production costs applicable to sales including depreciation, depletion and amortization (GAAP). THREE MONTHS ENDED JUNE 30, 2006 (In thousands except ounces and per ounce costs) Broken Cerro Endeavor Hill Rochester Bayo Martha (1) (1) Total Production of Silver (ounces) 1,153,295 789,746 633,014 80,890 528,041 3,184,186 Cash Costs per ounce $2.61 $1.82 $5.14 $2.79 $3.27 $3.03 Total Cash Costs (Non-GAAP) $3,008 $1,439 $3,251 $225 $1,727 $9,650 Add/Subtract: Third party smelting costs -- (1,021) (469) (155) (762) (2,407) By-product credit (2) 11,535 6,298 522 -- -- 18,355 Other adjustments 197 -- -- -- -- 197 Change in inventory (4,130) (245) (159) (6) 332 (4,208) Depreciation, depletion and amortization 3,480 1,537 302 105 1,452 6,876 Production costs applicable to sales, including depreciation, depletion and amortization (GAAP) $14,090 $8,008 $3,447 $169 $2,749 $28,463 THREE MONTHS ENDED JUNE 30, 2005 (In thousands except ounces and per ounce costs) Broken Cerro Endeavor Hill Rochester Bayo Martha (1) (1) Total Production of Silver (ounces) 1,208,584 691,846 606,121 58,464 -- 2,565,015 Cash Costs per ounce $7.58 $0.76 $4.43 $1.89 -- $4.87 Total Cash Costs (Non- GAAP) $9,166 $527 $2,683 $111 -- 12,487 Add/Subtract: Third party smelting costs -- (519) (302) (58) -- (879) By-product credit (2) 6,168 6,452 314 -- -- 12,934 Other adjustment (101) (18) (101) -- -- (220) Change in inventory (8,240) 2,600 167 (38) -- (5,511) Depreciation, depletion and amortization 2,838 1,051 215 72 4,176 Production costs applicable to sales, including depreciation, depletion and amortization (GAAP) $9,831 $10,093 $2,976 $87 -- $22,987 (GAAP) $14,090 $8,008 $3,447 $169 $2,749 $28,463 SIX MONTHS ENDED JUNE 30, 2006 (In thousands except ounces and per ounce costs) Broken Cerro Endeavor Hill Rochester Bayo Martha (1) (1) Total Production of Silver (ounces) 2,301,658 1,305,568 1,176,500 165,170 1,085,353 6,034,249 Cash Costs per ounce $3.46 $2.47 $5.04 $2.45 $3.07 $3.46 Total Cash Costs (Non-GAAP) $7,972 $3,222 $5,932 $405 $3,336 $20,867 Add/Subtract: Third party smelting costs -- (1,792) (781) (257) (1,334) (4,164) By-product credit (2) 20,476 11,171 893 -- -- 32,540 Other adjustments 936 -- -- -- -- 936 Change in inventory (7,022) (1,596) (223) (54) 403 (8,492) Depreciation, depletion and amortization 6,518 2,820 540 214 2,985 13,077 Production costs applicable to sales, including depreciation, depletion and amortization (GAAP) $28,880 $13,825 $6,361 $308 $5,390 $54,764 SIX MONTHS ENDED JUNE 30, 2005 (In thousands except ounces and per ounce costs) Broken Cerro Endeavor Hill Rochester Bayo Martha (1) (1) Total Production of Silver (ounces) 2,344,581 1,351,139 985,181 58,464 -- 4,739,365 Cash Costs per ounce $6.96 $0.31 $4.68 $ 1.89 -- $4.53 Total Cash Costs (Non-GAAP) $16,319 $418 $4,615 $111 -- $21,463 Add/Subtract: Third party smelting costs -- (1,238) (499) (58) -- (1,795) By-product credit (2) 12,160 12,800 515 -- -- 25,475 Other adjustment (201) (10) (174) -- -- (385) Change in inventory (11,798) 3,266 (35) (38) -- (8,605) Depreciation, depletion and amortization 5,368 2,322 381 73 -- 8,144 Production costs applicable to sales, including depreciation, depletion and amortization (GAAP) $21,848 $17,558 $4,803 $88 -- $44,297 The following tables present a reconciliation between non-GAAP cash costs per ounce to GAAP production costs applicable to sales reported in Discontinued Operations (see Note D): Coeur Silver Valley/Galena THREE MONTHS SIX MONTHS ENDED JUNE 30, ENDED JUNE 30, 2006(3) 2005 2006(3) 2005 (In thousands except ounces and per ounce costs) Production of Silver (ounces) 269,027 559,700 768,674 1,269,996 Cash Costs per ounce $10.72 $8.05 $9.75 $7.32 Total Cash Costs (Non-GAAP) $2,883 $4,508 $7,498 $9,290 Add/Subtract: Third party smelting costs (595) (835) (1,464) (1,959) By-product credit (2) 677 689 1,473 1,628 Change in inventory 1,008 373 726 (323) Depreciation, depletion and amortization 86 501 681 1,013 Production costs applicable to sales, including depreciation, depletion and amortization (GAAP) $4,059 $5,236 $8,914 $9,649 (1) The Company's share of silver production at Endeavor and Broken Hill commenced in May 2005 and September 2005, respectively. (2) By-product credits are based upon production units and the period's average metal price for the purposes of reporting cash costs per ounce. (3) Amounts represent two and five months ended May 31, 2006, respectively. COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) June 30, December 31, 2006 2005 ASSETS (In Thousands) CURRENT ASSETS Cash and cash equivalents $373,392 $214,616 Short-term investments 19,896 25,726 Receivables 28,597 27,986 Ore on leach pad 28,740 25,394 Metal and other inventories 13,394 12,807 Deferred tax assets 3,855 2,255 Prepaid expenses and other 6,590 4,707 Assets of discontinued operations held for sale (Note D) -- 14,828 474,464 328,319 PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment 111,918 105,107 Less accumulated depreciation (61,033) (57,929) 50,885 47,178 MINING PROPERTIES Operational mining properties 124,721 121,441 Less accumulated depletion (110,759) (105,486) 13,962 15,955 Mineral interests 72,201 72,201 Less accumulated depletion (5,417) (2,218) 66,784 69,983 Non-producing and development properties 119,519 72,488 200,265 158,426 OTHER ASSETS Ore on leach pad, non-current portion 34,265 29,254 Restricted cash and cash equivalents 19,035 16,943 Debt issuance costs, net 5,303 5,454 Deferred tax assets 2,292 923 Other 7,574 8,319 68,469 60,893 TOTAL ASSETS $794,083 $594,816 COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS(Unaudited) June 30, December 31, 2006 2005 (In thousands except share data) LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $24,324 $17,189 Other current liabilities 11,315 6,274 Accrued interest payable 1,031 1,031 Accrued salaries and wages 6,723 7,840 Current taxes payable 5,445 66 Liabilities of discontinued operations held for sale (Note D) -- 12,908 48,838 45,308 LONG-TERM LIABILITIES 1 1/4% Convertible Senior Notes due January 2024 180,000 180,000 Reclamation and mine closure 24,278 24,082 Other long-term liabilities 3,677 3,873 207,955 207,955 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Common Stock, par value $1.00 per share; authorized 500,000,000 shares, issued 278,994,490 and 250,961,353 shares in 2006 and 2005 (1,059,211 shares held in treasury) 278,994 250,961 Additional paid-in capital 776,305 656,977 Accumulated deficit (504,722) (551,357) Shares held in treasury (13,190) (13,190) Accumulated other comprehensive loss (97) (1,838) 537,290 341,553 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $794,083 $594,816 COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Three and Six Months Ended June 30, 2006 and 2005 (Unaudited) Three Months Six Months Ended June 30, Ended June 30, 2006 2005 2006 2005 (In Thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $32,648 $(1,701) $46,985 $(2,846) Add (deduct) non-cash items: Depreciation and depletion 6,989 4,372 13,307 8,521 Deferred taxes (1,058) (559) (3,131) 120 Unrealized loss on embedded derivative, net 4,760 426 3,201 35 Share based compensation 538 174 1,164 574 Loss (gain) on sale of net assets of discontinued operations and other, net (11,306) 167 (11,322) 167 Other charges 175 429 692 840 Changes in Operating Assets and Liabilities: Receivables (4,020) (11,554) 810 (12,871) Prepaid and other current assets (1,362) (1,603) (1,025) (722) Inventories (4,355) (5,937) (8,945) (9,193) Accounts payable and accrued liabilities 8,554 4,695 7,636 2,363 Discontinued operations 469 1,946 (176) 1,370 CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 32,032 (9,145) 49,196 (11,642) CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (25,677) (21,889) (53,484) (25,388) Purchases of short-term investments 1,498 (12,294) (9,883) (22,840) Proceeds from sales of short-term investments 3,300 16,097 13,616 22,112 Other (202) 61 (443) 33 Discontinued operations 14,862 (733) 14,365 (1,366) CASH USED IN INVESTING ACTIVITIES (6,219) (18,758) (35,829) (27,449) CASH FLOWS FROM FINANCING ACTIVITIES: Retirement of long-term debt (352) (76) (689) (156) Proceeds from issuance of common stock -- -- 154,560 -- Payment of public offering costs -- 17 (8,388) (552) Other 280 -- (74) -- CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES: (72) (59) 145,409 (708) INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 25,741 (27,962) 158,776 (39,799) Cash and cash equivalents at beginning of period 347,651 261,231 214,616 273,068 Cash and cash equivalents at end of period $373,392 $233,269 $373,392 $233,269 DATASOURCE: Coeur d'Alene Mines Corporation CONTACT: Scott Lamb, +1-208-665-0777 Web site: http://www.coeur.com/

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