Coeur Mining, Inc. (the "Company" or "Coeur") (NYSE: CDE) today
announced fourth quarter 2018 production of 3.5 million ounces of
silver, 99,460 ounces of gold, 3.1 million pounds of zinc and 1.7
million pounds of lead, or 9.8 million silver equivalent1 ounces
(12.2 million ounces based on average spot prices during the fourth
quarter).2 Silver and gold production during the fourth quarter
increased 19% and 12%, respectively, compared to the prior quarter.
Strong results were driven by increased production from Palmarejo
and Rochester as well as significantly higher production from
Kensington.
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Quarterly Production Results (Graphic:
Business Wire)
Full-year 2018 production included 12.9 million ounces of
silver, 367,728 ounces of gold, 6.8 million pounds of zinc and 3.9
million pounds of lead, or 35.6 million silver equivalent1 ounces
(43.4 million ounces based on average spot prices for the year).2
Silver production increased 8% during 2018 driven by strong
performance at Palmarejo and Rochester. Gold production decreased
4% over the same period as positive results from Palmarejo and
Rochester were outweighed by lower production at Wharf.
Metal sales for the fourth quarter totaled 3.1 million ounces of
silver, 87,514 ounces of gold, 2.6 million pounds of zinc and 1.4
million pounds of lead, or 8.5 million silver equivalent1 ounces
(10.7 million ounces based on average spot prices during the
quarter).2 Full-year 2018 metal sales totaled 12.4 million ounces
of silver, 358,731 ounces of gold, 4.8 million pounds of zinc and
3.1 million pounds of lead, or 34.3 million silver equivalent1
ounces (41.9 million ounces based on average spot prices for the
year).2 Metal sales reflect the impact of the bankruptcy filing of
Republic Metals Corp. ("RMC"), a U.S.-based precious metals
refiner, that occurred in early November. Approximately 0.4 million
ounces and 6,500 ounces of the Company's silver and gold,
respectively, were affected by RMC's Chapter 11 filing.
The Company expects to issue full-year 2019 production and cost
guidance in conjunction with the release of its fourth quarter and
full-year 2018 financial results on February 20, 2019.
Quarterly Production Results
Note: On February 28, 2018, Coeur divested the San Bartolomé
mine through the sale of its 100%-owned Bolivian subsidiary. As a
result, San Bartolomé is excluded from consolidating operating
statistics for all periods presented unless otherwise noted.
Operations
Fourth quarter and full-year 2018 production and sales
highlights for each of Coeur's operations are provided below.
Palmarejo, Mexico
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Tons milled
1,382,471 378,389 300,116
344,073 359,893 1,498,421 389,524 Average silver grade (oz/t)
6.49 5.96 6.26 6.86 6.88 5.62 6.92 Average gold grade (oz/t)
0.10 0.08 0.10 0.11 0.10 0.09 0.10 Average recovery rate –
Ag
83.8% 84.0% 82.2% 87.5% 81.4% 86.0% 87.0% Average
recovery rate – Au
88.9% 97.6% 88.8% 89.9% 80.4% 90.0% 92.0%
Ounces Produced Silver (000's)
7,516 1,893 1,544 2,066 2,013
7,242 2,346 Gold
122,722 31,239 27,885 33,702 29,896 121,569
37,537 Silver equivalent1 (000's)
14,880 3,768 3,217 4,088
3,807 14,536 4,600 Silver equivalent1 (average spot) (000's)
17,429 4,528 3,796 4,728 4,382 16,207 5,209 Ounces Sold
Silver (000's)
7,229 1,534 1,572 2,092 2,031 7,586 2,343
Gold
115,592 23,667 29,830 31,207 30,888 131,743 38,953
Silver equivalent1 (000's)
14,165 2,955 3,362 3,964 3,884
15,491 4,681 Silver equivalent1 (average spot) (000's)
16,566 3,530 3,981 4,557 4,479 17,301 5,313 Average realized
price per silver ounce
$15.77 $14.57 $14.75 $16.49 $16.73
$16.96 $16.57 Average realized price per gold ounce
$1,140
$1,148 $1,082 $1,162 $1,168 $1,110 $1,139
- Fourth quarter gold and silver
production increased 12% and 23%, respectively, to 31,239 and 1.9
million ounces compared to the prior quarter. Silver equivalent1
production was 3.8 million ounces (4.5 million ounces based on
average spot prices during the fourth quarter), 17% higher compared
to the third quarter. Year-over-year, gold and silver production
increased 1% and 4%, respectively
- Higher production during the quarter
was driven largely by increased throughput as the Company processed
ore that was initially scheduled to be processed in the third
quarter. This contributed to a one-time increase in reported
recoveries due to a reduction of in-circuit inventory;
metallurgical recoveries were relatively flat during the
quarter
- Underground development at the La
Nación deposit, located between the Independencia and Guadalupe
underground mines, remains on-schedule. Production is expected to
commence in the second half of 2019, providing anticipated
additional mill feed to supplement existing ore sources
- Approximately 23% of gold sales in the
fourth quarter, or 5,458 ounces, were sold under Palmarejo's gold
stream agreement at a price of $800 per ounce. For the full year, a
total of 35,807 ounces of gold (31% of Palmarejo's gold sales),
were sold under this agreement
Rochester, Nevada
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Tons placed
16,169,807 3,674,566
4,061,082 4,083,028 4,351,131 16,440,270 4,171,451 Average silver
grade (oz/t)
0.52 0.46 0.52 0.53 0.54 0.53 0.50 Average gold
grade (oz/t)
0.004 0.004 0.004 0.004 0.003 0.003 0.003
Ounces Produced Silver (000's)
5,038 1,466 1,290 1,125 1,157
4,714 1,361 Gold
54,388 15,926 14,702 12,273 11,487 51,051
18,995 Silver equivalent
1 (000's)
8,301 2,422 2,172
1,861 1,846 7,777 2,500 Silver equivalent1 (average spot) (000's)
9,431 2,809 2,477 2,095 2,067 8,478 2,808 Ounces Sold Silver
(000's)
4,855 1,391 1,248 1,097 1,119 4,931 1,457 Gold
52,789 15,339 14,257 12,030 11,163 54,642 20,002 Silver
equivalent1 (000's)
8,022 2,310 2,104 1,819 1,789 8,210
2,658 Silver equivalent1 (average spot) (000's)
9,118 2,683
2,400 2,048 2,004 8,961 2,983 Average realized price per silver
ounce
$15.50 $14.53 $14.70 $16.47 $16.66 $16.98 $16.58
Average realized price per gold ounce
$1,261 $1,234 $1,204
$1,297 $1,331 $1,262 $1,279
- Silver and gold production during the
fourth quarter increased 14% and 8%, respectively, to 1.5 million
and 15,926 ounces compared to the prior quarter. Silver equivalent1
production during the period was 12% higher quarter-over-quarter at
2.4 million ounces (2.8 million ounces based on average spot prices
during quarter)
- For the full year, silver production
was 5.0 million ounces while gold production was 54,388 ounces,
both 7% higher than 2017, with silver equivalent1 production
totaling 8.3 million ounces (9.4 million ounces based on average
spot prices)
- Production was positively impacted by
the continued strong performance of both the Stage IV and Stage III
leach pads. These positive results outweighed the impact of lower
crushing rates during the fourth quarter, which were anticipated
following the decommissioning of the 15,000 ton per day ("tpd")
in-pit crusher
- Installation of an initial
high-pressure grinding roll ("HPGR") unit remains on schedule and
budget. The concrete foundation for the HPGR is complete and
structural erection is scheduled for the end of January. Ore
production utilizing the HPGR unit is anticipated to commence in
the second quarter, with silver recoveries expected to increase
beginning mid-year
- Installation of the HPGR unit and a new
secondary crusher is expected to result in higher production during
the second half of the year compared to the first half
Wharf, South Dakota
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Tons placed
4,923,774 1,644,168
1,127,391 1,075,820 1,076,395 4,560,441 1,124,785 Average gold
grade (oz/t)
0.022 0.020 0.023 0.023 0.022 0.027 0.029
Ounces produced Gold
76,840 16,960 19,437 22,507 17,936
95,372 27,292 Silver (000's)
51 13 13 13 12 64 16 Gold
equivalent1
77,683 17,175 19,646 22,729 18,133 96,431 27,560
Ounces sold Gold
75,572 15,306 19,874 23,053 17,339 98,237
28,975 Silver (000's)
48 11 12 14 11 74 16 Gold equivalent1
76,373 15,488 20,081 23,282 17,522 99,472 29,256 Average
realized price per gold ounce
$1,267 $1,247 $1,198 $1,285
$1,341 $1,269 $1,278
- Gold production declined 13%
quarter-over-quarter to 16,960 ounces in the fourth quarter. This
was primarily due to the placement of lower grade ore during the
quarter as well as temporary percolation issues resulting in
slower-than-anticipated recoveries
- For the full year, gold production
decreased 19% to 76,840 ounces as a result of unplanned
weather-related downtime in the third quarter and timing of leach
pad recoveries
- Tons placed for the full year reached
4.9 million tons, up from 4.6 million in 2017 and 4.3 million in
2016
- Production in 2019 is expected to
return to levels comparable to prior quarters
Kensington, Alaska
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Tons milled
661,731 166,310 167,964
168,751 158,706 668,727 167,631 Average gold grade (oz/t)
0.19 0.23 0.17 0.16 0.17 0.18 0.22 Average recovery rate
93.0% 93.0% 91.8% 92.6% 94.0% 93.5% 92.8% Gold ounces
produced
113,778 35,335 26,809 25,570 26,064 115,094 34,932
Gold ounces sold
114,778 33,202 25,648 28,165 27,763 125,982
35,634 Average realized price per gold ounce
$1,247 $1,246
$1,161 $1,269 $1,307 $1,226 $1,244
- Commercial production at Jualin was
declared on December 1, 2018. The figures shown in the table above
include pre-commercial production
- Fourth quarter gold production of
35,335 ounces represented a 32% increase quarter-over-quarter and
was slightly higher compared to the same period the prior year,
largely driven by additional production from Jualin
- Approximately 23,000 tons of
development ore and 3,000 tons of stope ore were mined from Jualin
during the fourth quarter, yielding production (inclusive of
pre-commercial) of nearly 10,500 ounces of gold at a grade of 0.40
ounces per ton, demonstrating the impact that high-grade mill feed
can have on the overall production profile of Kensington
- Full-year gold production of 113,778
ounces was relatively flat compared to 2017
Silvertip, British Columbia
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Tons milled
86,127 38,802 28,080
14,450 4,795 — — Average silver grade (oz/t)
8.04 6.06 7.29
14.15 10.05 — — Average zinc grade (%)
6.9% 5.8% 8.0% 8.2%
6.60 — — Average lead grade (%)
5.0% 3.9% 4.6% 8.1% 7.3% —%
—% Average recovery rate – Ag
49.1% 60.5% 47.0% 42.3% 30.9%
—% —% Average recovery rate – Zn
56.7% 69.1% 49.1% 57.9%
18.7% —% —% Average recovery rate – Pb
45.1% 54.7% 44.4%
40.5% 21.1% —% —% Produced Silver (000's ounces)
340 142 96
87 15 — — Zinc (000's lbs)
6,781 3,083 2,207 1,372 119 — —
Lead (000's lbs)
3,913 1,658 1,159 949 147 — — Silver
equivalent1 (000's)
943 411 286 217 29 — — Silver
equivalent1 (average spot) (000's)
1,117 488 342 277 36 — —
Sold Silver (000's ounces)
268 127 131 10 — — — Zinc (000's
lbs)
4,793 2,552 1,772 469 — — — Lead (000's lbs)
3,089 1,444 1,645 — — — — Silver equivalent1 (000's)
710 352 320 38 — — — Silver equivalent1 (average spot)
(000's)
837 418 371 52 — — — Average realized price per
silver ounce
$14.03 $13.79 $14.95 $13.01 — — — Average
realized price per zinc pound
$0.83 $0.75 $0.93 $1.08 — — —
Average realized price per lead pound
$0.81 $0.83 $0.99 $— —
— —
- Silvertip achieved commercial
production on September 1, 2018. The figures shown in the above
table include pre-commercial production
- On December 27, 2018, the Company
announced an initial reserve, which was used to support a
reserve-based mine plan and economic analysis, as well as an
updated resource. The Company will file a technical report in
accordance with National Instrument 43-101 by February 10,
2019
- Production of silver, zinc and lead
during the fourth quarter increased 48%, 41% and 42%, respectively,
compared to the prior quarter. The increases were primarily driven
by comparatively higher mill throughput rates compared to previous
quarters
- Although throughput has been lower than
originally anticipated, the Company continues progressing towards
its target of 1,100 tpd (1,000 metric tonnes per day ("mtpd")) by
the end of the first quarter. Month-to-date in January, throughput
rates have averaged 695 tpd (631 mtpd)
- Recovery rates continued to improve
throughout the fourth quarter, albeit remaining at lower than
targeted levels. Recovery rates are expected to trend higher as
mill consistency improves and the flotation circuit is optimized.
Average metal grade is also expected to improve as depleted ore
from historic stockpiles is now being replaced with newly-mined
underground material
- As operations continue to ramp up, the
Company remains focused on improvements in four key areas: (i) mill
projects targeting higher availability, (ii) maintenance procedures
and systems, (iii) supply chain and procurement, and (iv) employee
training and development
- Construction on the 220-person camp
facility was substantially completed by the end of the fourth
quarter, with personnel expected to begin moving in during the
first quarter of 2019
- The Company remains on track to receive
approval for the permit amendment application that will allow for a
sustained mining and milling rate of 1,100 tpd (1,000 mtpd) on a
year-round basis in early 2019
2018 Production Results
Coeur's 2018 production results, along with its most recent
production guidance published October 31, 2018, are shown
below.
2018 Production Results2
Silver Equivalent1
Silver Gold Zinc Lead 60:1
Average Spot (K oz)
(oz) (K lbs) (K lbs)
(K oz) (K oz) Palmarejo 7,516 122,722 —
— 14,880 17,429
Rochester 5,038 54,388 — — 8,301 9,431
Wharf 51 76,840 — — 4,661 6,206
Kensington — 113,778
— — 6,827 9,190
Silvertip 340 — 6,781
3,913 943 1,117
Total 12,945
367,728 6,781 3,913 35,612
43,373
2018 Production Guidance3
Silver Equivalent1
Silver Gold Zinc Lead 60:1
Average Spot (K oz)
(oz) (K lbs) (K lbs)
(K oz) (K oz) Palmarejo 7,500 - 7,900
115,000 - 120,000 — — 14,400 - 15,100 16,782 - 17,586
Rochester 4,800 - 5,200 48,000 - 52,000
—
— 7,680 - 8,320 8,674 - 9,397
Wharf — 85,000 - 90,000
—
— 5,100 - 5,400 6,861 - 7,264
Kensington — 115,000 - 120,000
— — 6,900 - 7,200 9,282 - 9,686
Silvertip 700 - 1,200
— 13,000 - 23,000 11,000 - 18,000 2,030
- 3,480 2,515 - 4,316
Total 13,000 - 14,300
363,000 - 382,000 13,000 - 23,000 11,000 -
18,000 36,110 - 39,500 44,114 - 48,248
Financial Results and Conference Call
Coeur will report its fourth quarter and full-year 2018
financial results on February 20, 2019 after the New York Stock
Exchange closes for trading. There will be a conference call on
February 21, 2019 at 11:00 a.m. Eastern Time.
Dial-In Numbers: (855)
560-2581 (U.S.) (855) 669-9657 (Canada) (412) 542-4166
(International) Conference ID: Coeur Mining
Hosting the call will be Mitchell J. Krebs, President and Chief
Executive Officer of Coeur, who will be joined by Thomas S. Whelan,
Senior Vice President and Chief Financial Officer, Terry F. D.
Smith, Senior Vice President of Operations, Hans Rasmussen, Senior
Vice President of Exploration, and other members of management. A
replay of the call will be available through March 7, 2019.
Replay numbers: (877)
344-7529 (U.S.) (855) 669-9658 (Canada) (412) 317-0088
(International) Conference ID: 101 27 575
About Coeur
Coeur Mining, Inc. is a well-diversified, growing precious
metals producer with five mines in North America. Coeur produces
from its wholly-owned operations: the Palmarejo silver-gold complex
in Mexico, the Silvertip silver-zinc-lead mine in British Columbia,
the Rochester silver-gold mine in Nevada, the Wharf gold mine in
South Dakota, and the Kensington gold mine in Alaska. In addition,
the Company has interests in several precious metals exploration
projects throughout North America.
Cautionary Statement
This news release contains forward-looking statements within the
meaning of securities legislation in the United States and Canada,
including statements regarding anticipated recoveries, mining
rates, throughput, development efforts, grades, operations at
Rochester, improvements at Silvertip, and timing of obtaining
permit amendment approval for Silvertip. 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
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, silver, zinc,
and lead 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, the uncertainties inherent in the
estimation of gold and silver reserves, changes that could result
from Coeur's future acquisition of new mining properties or
businesses, the loss or insolvency of any third-party smelter or
refiner with whom Coeur does business, 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, 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 Form 10-K and Form 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.
Christopher Pascoe, Coeur's Director, Technical Services 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
sedar.com.
Notes
- Silver equivalence assumes
silver-to-gold, -lead and -zinc ratios of 60:1, 0.05:1 and 0.06:1,
respectively, except where noted as average spot prices. Please see
the table below for average applicable spot prices and
corresponding ratios.
- Fourth quarter and full-year 2018
production and sales figures include pre-commercial production from
Kensington (Jualin) and Silvertip.
- Full-year 2018 production guidance
includes pre-commercial production from Kensington (Jualin) and
Silvertip.
Average Spot Prices
2018 4Q 2018 3Q 2018
2Q 2018 1Q 2018 2017
4Q 2017 Average Silver Spot Price Per Ounce $ 15.71 $
14.54 $ 15.02 $ 16.53 $ 16.77 $ 17.05 $ 16.73 Average Gold Spot
Price Per Ounce $ 1,268 $ 1,226 $ 1,213 $ 1,306 $ 1,329 $ 1,257 $
1,275
Average Silver to Gold Spot Equivalence 81:1
84:1 81:1 79:1 79:1 74:1 76:1 Average Zinc Spot Price Per Pound $
1.33 $ 1.19 $ 1.15 $ 1.41 $ 1.55 $ 1.31 $ 1.47
Average Silver to
Zinc Spot Equivalence 0.08:1 0.08:1 0.08:1 0.09:1 0.09:1
0.08:1 0.09:1 Average Lead Spot Price Per Pound $ 1.02 $ 0.89 $
0.95 $ 1.08 $ 1.14 $ 1.05 $ 1.13
Average Silver to Lead Spot
Equivalence 0.06:1 0.06:1 0.06:1 0.07:1 0.07:1 0.06:1
0.07:1
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version on businesswire.com: https://www.businesswire.com/news/home/20190114005799/en/
Coeur Mining, Inc.Paul DePartout, Director, Investor
Relations(312) 489-5800www.coeur.com
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