Coeur Reports Third Quarter Results - Growing Operating Cash
Flow/EBITDA - COEUR D'ALENE, Idaho, Nov. 8 /PRNewswire-FirstCall/
-- Coeur d'Alene Mines Corporation (NYSE:CDE), the world's largest
primary silver producer and a growing gold producer, today reported
results for the third quarter and first nine months of 2004.
Highlights Third Quarter -- $0.1 million loss (excluding merger
costs and pre-development expenses) compared with an $11.4 million
loss (excluding debt restructuring costs and pre-development
expenses) in the third quarter of 2003. -- $2.1 million of
operating profit deferred to the fourth quarter of 2004 due to
concentrate shipments at the Cerro Bayo mine delayed by a temporary
shutdown at the third-party smelter. -- EBITDA (excluding merger
costs and pre-development expenses) of $5.5 million compared to
$(1.4) million (excluding debt restructuring costs and
pre-development expenses) in 2003's third quarter. -- Third quarter
silver production of 3.0 million ounces, compared to 3.3 million
ounces in the third quarter of 2003. -- Third quarter gold
production of 32,317 ounces, up 16% from the second quarter of 2004
and 6% higher than the third quarter of 2003. -- Third quarter
revenue of $31.3 million, up 15% from the second quarter of 2004,
and up 30% from the third quarter of 2003. -- $218.4 million in
cash, cash equivalents and short-term investments at September 30.
First Nine Months -- Loss of $1.5 million (excluding $23.7 million
in pre-development costs and merger expenses), which compared to a
loss of $18.2 million, (excluding $35.2 million of pre-development
costs and debt restructuring costs) in the first nine months of
2003. -- Silver production of 9.8 million ounces, compared to 10.7
million ounces in the first nine months of 2003. -- Gold production
of 82,277 ounces, compared to 93,410 ounces in the first nine
months of 2003. -- Revenue of $87.4 million, up 10% from the same
period a year ago. Operational -- Full-year 2004 silver production
expected at 13.7 million ounces. -- Projected 2004 total gold
production of 132,000 ounces. -- Full year cash operating costs of
$3.41 per silver ounce anticipated. -- Final permitting at
Kensington (Alaska) gold project expected in the first quarter of
2005, followed by a construction decision and initial production in
2006. -- San Bartolome (Bolivia) updated feasibility study
completed; construction decision expected in the fourth quarter of
2004, with initial silver production anticipated in 2006.
Construction capital now estimated at $135 million and cash
operating costs estimated at $3.65 per silver ounce. New Bolivian
tax regulations expected to benefit mine construction and
operation. -- Positive exploration results -- drilling at Cerro
Bayo through the first nine months has already replaced expected
2004 production, with mine life at Martha increased to mid-2006
with additional exploration potential. "Increased gold production
at our silver mines, along with higher metals prices, resulted in a
dramatic improvement in revenues in the recent quarter compared to
both the second quarter of this year and last year's third quarter.
Meanwhile, we continued to invest in our new development projects
and in exploration, with significant results, at our South America
and Silver Valley (Idaho) mines," said Dennis E. Wheeler, Chairman
and Chief Executive Officer. "Coeur's operations during the third
quarter of 2004 demonstrated improving gold production rates
resulting in positive operating cash flow before pre-development
expenses and the impact of our previously proposed merger with
Wheaton River Minerals, a production and cash flow trend we expect
will continue through the remainder of the year. By year-end, we
now expect to reach production levels of 13.7 million ounces of
silver and 132,000 ounces of gold, at full-year cash costs of $3.41
per ounce of silver. Our balance sheet remains very strong, with
$218 million in cash, which would allow us to fund our Kensington
and San Bartolome projects. "This year, we markedly expanded the
size of our exploration programs. Drilling year-to-date at Silver
Valley, Cerro Bayo (Chile) and Martha (Argentina) has resulted in
increased reserve and resource levels and anticipated mine lives.
Already, results from this year have extended the mine life at
Martha to at least mid-2006, with further opportunity to expand
mineralized material. "At our Kensington gold development project,
the final SEIS permit and Record of Decision are expected in the
first quarter of 2005. Other ancillary permit applications have
undergone the public review process and are currently being
reviewed by federal and state agencies for issuance, which are
expected in the first quarter of 2005. Final approval has been
secured from the City and Borough of Juneau. At San Bartolome, the
updated final feasibility study was completed and a construction
decision is expected by year-end. Both of these major projects are
targeted for initial production in 2006, adding significantly to
Coeur's overall gold and silver production growth," Mr. Wheeler
concluded. As previously reported, the Company's tender offer for
outstanding shares of Wheaton River Minerals Ltd. expired on
September 30, 2004. Coeur did not purchase any Wheaton shares
tendered due to unsatisfied conditions of the offer. Financial
Summary Coeur reported revenue of $31.3 million in the third
quarter of 2004, a 30 percent increase over revenue of $24.0
million in the third quarter of 2003. The increase was due
primarily to the higher realized silver and gold market prices
compared to last year's third quarter. For the third quarter, Coeur
realized an average silver price of $6.74 per ounce compared to an
average realized price during last year's third quarter of $4.94
per ounce. For its gold sales, Coeur realized an average price of
$410 per ounce during the third quarter compared to an average gold
price of $341 per ounce during the same period last year.
Company-wide production in the third quarter was 3.0 million ounces
of silver and 32,317 ounces of gold, compared to 3.3 million ounces
of silver and 30,566 ounces of gold in the third quarter of 2003.
Third quarter gold production increased 16 percent over the second
quarter of this year, and 47 percent over first quarter levels.
During the third quarter, results were adversely affected by a
delay in concentrate shipments from the Company's Cerro Bayo mine
resulting from a temporary shutdown at the third-party smelter.
Consequently, $7.7 million of sales under contract and $2.1 million
of operating profit associated with the delivery of 583,315 ounces
of silver and 10,298 ounces of gold was deferred to the fourth
quarter of 2004. The smelter issue was resolved during the quarter
and normal shipping of concentrates has resumed. As a result, in
the recent third quarter, the Company reported a net loss of $18.1
million, or $0.08 per share, compared to a net loss of $17.6
million, or $0.10 per share a year ago. This year's third quarter
included $3.1 million in pre-development costs related to the
Company's two major development projects, San Bartolome and
Kensington, which are designed to significantly increase future
gold and silver production, and $14.9 million of non-recurring
merger expenses. Third quarter exploration expenditures of $3.3
million were almost triple the exploration funds spent in the same
period a year ago, as the Company maintained its expanded
exploration program to increase reserves and discover new silver
and gold mineralization around three of its producing properties in
the U.S. and southern South America. Operating cash flow of $(7.0)
million, compared to $(0.2) million in the same period of 2003, was
impacted by $14.9 million of expenses associated with Coeur's
tender offer for Wheaton River Minerals and $3.1 million of
pre-development expenses associated with the Kensington and San
Bartolome projects. EBITDA, excluding these expenses, improved to
$5.5 million in the third quarter, compared to $4.1 million,
excluding pre-development expenses, in the previous quarter, and
from $(1.4) million in last year's third quarter, excluding
pre-development and restructuring charges. For the first nine
months of 2004, Company revenue was $87.4 million, an increase of
10 percent over the same period a year ago. For the first nine
months of 2004, the Company realized an average silver price of
$6.67 per ounce compared to an average realized price of $4.77
during the same period of last year. The Company realized an
average price of $401 per ounce of gold compared to $339 per ounce
during the same period last year. Production through the first nine
months totaled 9.8 million ounces of silver and 82,277 ounces of
gold. Last year through September 30, the Company produced 10.7
million ounces of silver and 93,410 ounces of gold. Full year 2004
production is projected to reach approximately 13.7 million ounces
of silver and approximately 132,000 ounces of gold, with the
consolidated production of both metals expected to remain strong
through the remainder of the year, with lower operating costs. For
the first nine months of 2004, the Company reported a net loss of
$25.1 million, or $0.12 per share, which also included the future
growth initiatives of $8.8 million in pre-development costs and
$8.3 million in exploration expenses, or two-and-a-half times the
exploration expenses in the first nine months of 2003. In addition,
during the third quarter, results were adversely affected by a
delay in concentrate shipments from the Company's Cerro Bayo Mine
resulting from a temporary shutdown at the third-party smelter.
Consequently, $7.7 million of sales under contract and $2.1 million
of operating profit associated with the delivery of 583,315 ounces
of silver and 10,298 ounces of gold was deferred to the fourth
quarter of 2004. The smelter issue was resolved during the quarter
and normal shipping of concentrates has resumed. Also contributing
to the loss was $14.9 million of non-recurring merger expenses. For
the first nine-month period of 2003, the Company reported a loss of
$53.4 million, or $0.35 per share, including $34.0 million of
expenses related to the early retirement of debt. The Company's
balance sheet remained very strong, with $218.4 million in cash,
cash equivalents and short-term investments at September 30, 2004.
None of the Company's future gold or silver production is hedged.
Overview of Operations "Results from our combined South American
operations during the third quarter were highlighted by increasing
gold production and a reduction in cash costs from the second
quarter to $2.95 per ounce of silver," said Robert Martinez,
President and Chief Operating Officer. "At Silver Valley, our
operations continued to generate strong operating cash flow to fund
our ongoing, long-term expansion plan. Finally, gold production
rates at Rochester increased from the second quarter, but have not
accelerated at the rate previously anticipated." South America
Cerro Bayo (Chile)/Martha (Argentina) -- Third quarter production
of 923,789 ounces of silver and 14,885 ounces of gold. -- Cash
costs of $2.95 per ounce of silver during third quarter. -- Nine
months production: 3.2 million ounces of silver and 37,365 ounces
of gold. -- Cash cost in the first nine months of $2.87 per ounce
of silver. -- Full year 2004 production expected at 4.7 million
ounces of silver and 56,000 ounces of gold at estimated average
cash cost of $2.10 per ounce of silver. -- Drilling through first
nine months has replaced expected 2004 production at Cerro Bayo,
with mine life at Martha extended into mid-2006 with further
exploration potential. During the third quarter, gold production
increased 25 percent from the second quarter of this year, due to
increased gold grades processed from Cerro Bayo. Production from
Cerro Bayo included ores from five different vein systems,
including high-grade ounces from the Javiera and Cerro Bayo
systems. During the quarter, mining at Martha began to include ores
from the recently discovered and developed R-4 Deep and Mina Martha
Deep zones, where higher-grade silver ores are expected to
contribute to increased silver production in the fourth quarter.
The ores from Cerro Bayo and Martha are combined and processed
together at the Cerro Bayo plant. At Martha, mining in the third
quarter included the area around the recent high-grade drill hole
MM68 intercepted earlier this year containing grades of over 580
ounces of silver per ton, which added more than 50,000 ounces to
the quarterly production totals. Exploration and development work
thus far this year at Martha has successfully increased projected
mine life into mid-2006, with additional exploration drilling
continuing through the remainder of this year. For the full year at
Cerro Bayo, cash costs are expected to be significantly lower at
approximately $2.10 per ounce, as both gold and silver production
continued to accelerate through the remainder of 2004. Continued
Reserve Expansion at Cerro Bayo and Martha Reserve development
drilling accelerated at Cerro Bayo in the third quarter and is
ahead of planned drill footage for the year. So far in 2004, over
77,000 feet of drilling has taken place at sites near and around
current mining areas. Cerro Bayo exploration this year is
successfully meeting its budget and has already replaced expected
production for 2004, with drilling to expand on those results
scheduled for the remainder of the year. Also, in the Cerro Bayo
district, exploration drilling of new mineralized vein structures
returned positive values from Lourdes Norte, Mercedes and Rosario
at the east side of the holdings and at Cristal 1000 near the
Company's processing facilities at Laguna Verde to the west. The
first hole at Rosario hit 9.8 feet of 0.13 ounces of gold and 8.04
silver ounces per ton. Follow-up drilling is planned for the fourth
quarter. Since recommencement of production at Cerro Bayo in 2002,
reserves have more than doubled. At Martha and surrounding
properties in Argentina, exploration continued in the third quarter
to define new reserves and discover new mineralization. Over 69,200
feet of drilling has been completed through the third quarter of
2003 on all of the Company's properties in Argentina; 85% of which
was devoted to the area around the current Martha Mine. Since
acquisition of Coeur's 100%-owned Martha mine in 2002, reserves
have increased more than 300%. The focus of the recent quarter's
exploration at Martha was to expand and define new mineralization
discovered earlier this year in the new Francisca and Catalina
veins in the R4 Deep area. Results through the third quarter from
these two vein discoveries and other areas has extended the mine
life at Martha through mid-2006, with additional exploration
potential. North America Rochester Mine (Nevada) -- Third quarter
silver production of 1.3 million ounces and 17,432 ounces of gold,
a nine percent increase in gold production from the second quarter
2004. -- Cash costs of $4.23 per ounce of silver, a seven percent
decrease in costs from the second quarter of 2004. -- Nine months
production: 4.0 million ounces of silver and 44,912 ounces of gold.
-- Continued higher gold production expected through the remainder
of the year. -- Anticipated full year metals production of 5.5
million ounces of silver and 75,500 ounces of gold expected at an
average cash cost of $3.36 per ounce of silver. Production rates at
the Rochester mine following commissioning of the new crushing
plant did not recover to projected levels during the third quarter.
However, production levels are now accelerating at the mine. By
September, monthly gold recovery at Rochester had increased to
approximately 7,000 ounces per month, with approximately 30,000
ounces expected through the remainder of the year. This is the
result of the leaching of higher-grade gold ores placed on the pad
earlier this year and the completion of the new Stage IV leaching
areas, which allows for a higher than normal production rate. For
the full year 2004, Rochester is expected to produce a total of
approximately 5.5 million ounces of silver and 75,500 ounces of
gold at an average full-year cash operating cost of $3.36 per ounce
of silver. Coeur Silver Valley - Galena Mine (Idaho) -- Operations
continue to generate operating cash flow to fund the long-term
development plan. -- Third quarter silver production of 785,296
ounces at a cash operating cost of $6.16 per ounce. -- First nine
months production of 2.6 million ounces of silver at average cash
cost of $5.30 per ounce. -- Development plan on track for expected
future production increases and lower costs. -- Full-year 2004
silver production of 3.5 million ounces expected at average cash
cost of $5.26 per ounce. Third quarter production at Silver Valley
remained close to the Company's budgeted targets for the period,
with exploration and development work continuing for reserve
expansion and future production increases. Cash costs at the mine
were impacted in the quarter due to higher than budgeted labor
costs. Development work at Silver Valley remains on track for
increases in production and reduced cash costs that will maximize
the mine's cash flow and profitability going forward. Exploration
work at Silver Valley continued in the third quarter to test
targets identified in the company's long-range development plan and
to identify new targets for later drill testing. Overall results
to-date have discovered new silver mineralization in several
targets. In the third quarter, initial drilling at the Deep Coeur
target intersected an extension to the 483 vein in five of eight
holes with thin, high-grade silver (0.9 feet at 51.3 ounces of
silver per ton) intersected in one hole. Definition drilling
commenced at the 4300 to 4600 Silver vein target this recent
quarter, with the goal of defining over one million ounces of new
reserves on this target by year-end. Drilling year-to-date under
the Company's optimization plan has already succeeded identifying
reserves to replace all of the 2004 silver production. Kensington
(Alaska) gold project At Coeur's major gold project, Kensington in
southeast Alaska, the Company anticipates that the U.S. Forest
Service will issue the Final Supplemental EIS and Record of
Decision on the project in the first quarter of 2005. Remaining
federal and state permits could be issued during the first quarter
of 2005. With initial production expected in 2006, Kensington is
expected to produce approximately 100,000 ounces of gold annually
over its expected ten to fifteen year mine life. The expected
initial capital cost for Kensington is expected to be $91.5 million
and per ounce operating costs are estimated at approximately $220.
During the third quarter, the Juneau Planning Commission approved
the final Allowable Use Permit for Kensington. The Company has
recently identified an opportunity to add 350,000 to 400,000 gold
ounces at Kensington through a drilling program designed to upgrade
a portion of the mineralized material to reserves. The program is
expected to cost between $2 and $3 million and is estimated to take
six months to complete. All work could be done from existing
underground workings. San Bartolome (Bolivia) silver project --
Updated feasibility study completed; construction decision expected
in the fourth quarter. -- Recent Bolivian tax benefits would
positively impact project construction. At Coeur's 100%-owned San
Bartolome (Bolivia) silver project, the updated feasibility work
was completed at the end of October. Based on the updated
feasibility study, the Company now estimates construction capital
to be $135 million with cash operating costs to be $3.65 per silver
ounce produced. The increase in capital and operating cost is due
to a number of factors including increases in commodity prices,
such as fuel, concrete and steel; revised prices in contractor
quotes from previous bids, higher labor costs; and some changes to
the scope of the project since the estimates were first developed.
A construction decision on San Bartolome is expected in the fourth
quarter. Recently, the government of Bolivia finalized regulations
extending tax benefits to new investments in mining projects in the
Potosi region, which will positively impact San Bartolome. These
benefits include the exemption of import duties and value added
taxes for imported capital goods used for the processing and
related facilities during the construction phase at San Bartolome.
Coeur d'Alene Mines Corporation (http://www.coeur.com/) is the
world's largest primary silver producer, as well as a growing,
low-cost producer of gold. The Company has mining interests in
Nevada, Idaho, Alaska, Argentina, Chile and Bolivia. Cautionary
Statement This document contains numerous forward-looking
statements 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, 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, 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 these forward-looking
statements, whether as a result of new information, future events
or otherwise. CONTACT: Tony Ebersole, Investor Relations Coeur
d'Alene Mines Corporation 1-800-523-1535 COEUR D'ALENE MINES
CORPORATION PRODUCTION STATISTICS Three Months Ended Nine Months
Ended September 30, September 30, 2004 2003 2004 2003 ROCHESTER
MINE Silver ozs. 1,324,127 1,717,947 3,951,428 4,160,993 Gold ozs.
17,432 15,346 44,912 41,237 Cash costs per oz./silver $4.23 $3.66
$4.78 $4.61 Full costs per oz./silver $6.22 $4.43 $6.59 $5.54 COEUR
SILVER VALLEY/GALENA MINE Silver ozs. 785,296 437,249 2,647,240
2,733,716 Cash costs per oz./silver $6.16 $5.46 $5.30 $4.62 Full
costs per oz./silver $6.77 $5.91 $5.84 $4.96 CERRO BAYO/MARTHA MINE
Silver ozs. 923,789 1,150,751 3,194,881 3,775,953 Gold ozs. 14,885
15,220 37,365 52,173 Cash costs per oz./silver $2.95 $1.18 $2.87
$0.73 Full costs per oz./silver $4.64 $2.41 $4.54 $2.48
CONSOLIDATED PRODUCTION TOTALS Silver ozs. 3,033,212 3,305,947
9,793,549 10,670,662 Gold ozs. 32,317 30,566 82,277 93,410 Cash
costs per oz./silver $4.34 $3.04 $4.30 $3.24 Full costs per
oz./silver $5.88 $3.92 $5.72 $4.31 CONSOLIDATED SALES TOTALS Silver
ozs. sold 2,790,537 3,144,852 9,345,292 10,911,567 Gold ozs. sold
26,172 29,258 73,408 97,287 Realized price per silver oz. $6.74
$4.94 $6.67 $4.77 Realized price per gold oz. $410 $341 $401 $339
Note: "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 produced 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. By calculating the cash costs from each of the
Company's mines on the same unit basis, management can easily
determine the gross margin that each ounce of gold and silver
produced is generating. "Cash Costs" are costs directly related to
the physical activities of producing silver and gold and include
mining, processing and other plant costs, deferred mining
adjustments, 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 (primarily gold and
copper) 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 set forth below.
Financial Measures That Supplement GAAP We sometimes refer to data
derived from consolidated financial information but not required by
GAAP to be presented in financial statements. Certain of these data
are considered "non-GAAP financial measures" under SEC regulations.
Specifically, we have referred to cash costs per ounce and EBITDA.
Reconciliation of these non-GAAP financial measures to its most
directly comparable GAAP financial measures-production costs and
net income-follows. Reconciliation of total cash costs to
production costs: Three months ended September 30, 2004 Silver
Cerro Rochester Valley Bayo Total Production of Silver (ounces)
1,324,127 785,296 923,789 3,033,212 Cash Costs per ounce $4.23
$6.16 $2.95 $4.34 Total Cash Costs (thousands) $5,602 $4,840 $2,726
$13,168 Add/(Subtract): Third Party Smelting Costs (234) (1,238)
(1,143) (2,615) By-Product Credit 7,007 846 5,971 13,824 Deferred
Stripping Adjustment (100) -- -- (100) Change in Inventory (4,439)
(584) (240) (5,263) Production Costs $7,836 $3,864 $7,314 $19,014
Three months ended September 30, 2003 Silver Cerro Rochester Valley
Bayo Total Production of Silver (ounces) 1,717,947 437,249
1,150,751 3,305,947 Cash Costs per ounce $3.66 $5.46 $1.18 $3.04
Total Cash Costs (thousands) $6,296 $2,387 $1,357 $10,040
Add/(Subtract): Third Party Smelting Costs (234) (648) (1,946)
(2,828) By-Product Credit 5,558 258 5,560 11,376 Deferred Stripping
Adjustment (80) -- -- (80) Change in Inventory (280) (476) 1,097
341 Production Costs $11,260 $1,521 $6,068 $18,849 Nine months
ended September 30, 2004 Silver Cerro Rochester Valley Bayo Total
Production of Silver (ounces) 3,951,428 2,647,240 3,194,881
9,793,549 Cash Costs per ounce $4.78 $5.30 $2.87 $4.30 Total Cash
Costs (thousands) $18,900 $14,039 $9,171 $42,110 Add/(Subtract):
Third Party Smelting Costs (655) (3,919) (4,087) (8,661) By-Product
Credit 17,969 2,559 14,977 35,505 Deferred Stripping Adjustment
(302) -- -- (302) Change in Inventory (12,239) 315 (4,400) (16,324)
Production Costs $23,673 $12,994 $15,661 $52,328 Nine months ended
September 30, 2003 Silver Cerro Rochester Valley Bayo Total
Production of Silver (ounces) 4,160,993 2,733,716 3,775,953
10,670,662 Cash Costs per ounce $4.61 $4.62 $0.73 $3.24 Total Cash
Costs (thousands) $19,196 $12,623 $2,770 $34,589 Add/(Subtract):
Third Party Smelting Costs (600) (3,530) (4,967) (9,097) By-Product
Credit 14,616 1,583 18,503 34,702 Deferred Stripping Adjustment
(241) -- -- (241) Change in Inventory (4,112) (22) (79) (4,213)
Production Costs $28,859 $10,654 $16,227 $55,740 Reconciliation of
Net Income (Loss) to EBITDA: For the Three and Nine Months Ended
September 30, 2004 and 2004 Three Months Ended Nine Months Ended
September 30, September 30, 2004 2003 2004 2003 Net Loss $(18,080)
$(17,611) $(25,147) $(53,369) Depreciation and depletion 4,862
3,257 14,481 12,955 Interest 662 6,703 2,257 10,726 Income taxes --
-- -- (7) Pre-development 3,117 463 8,768 1,229 Merger expenses
14,894 -- 14,894 -- Restructuring charges -- 5,769 -- 33,957
Cumulative change in accounting principle -- -- -- 2,306 EBITDA
$5,455 $(1,419) $15,253 $7,797 COEUR D'ALENE MINES CORPORATION AND
SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) September 30,
December 31, 2004 2003 (Restated) ASSETS (In Thousands) CURRENT
ASSETS Cash and cash equivalents $166,056 $62,417 Short-term
investments 52,335 19,265 Receivables 6,892 8,103 Ore on leach pad
18,577 17,388 Metal and other inventory 18,378 12,535 Prepaid
expenses and other 3,693 3,067 265,931 122,775 PROPERTY, PLANT AND
EQUIPMENT Property, plant and equipment 84,481 87,546 Less
accumulated depreciation (52,421) (52,868) 32,060 34,678 MINING
PROPERTIES Operational mining properties 117,275 114,018 Less
accumulated depletion (98,107) (90,245) 19,168 23,773 Mineral
interests 20,125 20,125 Non-producing and development properties
25,121 25,121 64,414 69,019 OTHER ASSETS Non-current ore on leach
pad 24,626 14,705 Restricted investments 10,860 8,710 Debt issuance
costs, net 5,832 87 Marketable securities 32 19 Other 8,624 9,474
49,974 32,995 Total assets $412,379 $259,467 COEUR D'ALENE MINES
CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(Unaudited) September 30, December 31, 2004 2003 (Restated) (In
Thousands) LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES
Accounts payable $12,589 $7,772 Accrued liabilities 12,156 5,218
Accrued interest payable 473 120 Accrued salaries and wages 5,043
5,705 Current portion of remediation costs 824 1,278 Current
portion of bank financing -- 2,367 31,085 22,460 LONG-TERM
LIABILITIES 1 1/4% Convertible Senior Notes due January 2024
180,000 -- 7 1/4% Convertible Subordinated Debentures due October
2005 -- 9,563 Reclamation and mine closure 21,992 20,934 Other
long-term liabilities 7,010 9,032 209,002 39,529 SHAREHOLDERS'
EQUITY Common Stock, par value $1.00 per share-authorized
500,000,000 shares, issued 214,319,770 and 214,195,186 at September
30, 2004 and December 31, 2003 (1,059,211 shares held in treasury
at both dates, respectively) 214,320 214,195 Additional paid-in
capital 543,263 542,900 Accumulated deficit (570,198) (545,050)
Shares held in treasury (13,190) (13,190) Accumulated other
comprehensive loss (1,903) (1,377) 172,292 197,478 TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY $412,379 $259,467 CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS COEUR D'ALENE MINES
CORPORATION AND SUBSIDIARIES (Unaudited) Three Months Ended Nine
Months Ended September 30, September 30, 2004 2003 2004 2003
Restated Restated (In Thousands, except per share data) REVENUES
Sales of metal $30,211 $23,636 $86,242 $78,245 Interest and other
1,056 326 1,142 1,071 Total revenues 31,267 23,962 87,384 79,316
COSTS and Expenses Production 19,014 18,849 52,328 55,740
Depreciation and depletion 4,862 3,257 14,481 12,955 Administrative
and general 3,266 2,776 9,941 8,241 Exploration 3,270 1,154 8,256
3,367 Pre-development 3,117 463 8,768 1,229 Interest 662 6,703
2,257 10,726 Other holding costs 262 2,602 1,606 4,171 Merger
Expenses 14,894 -- 14,894 -- Loss on exchange and early retirement
of debt -- 5,769 -- 33,957 Total cost and expenses 49,347 41,573
112,531 130,386 LOSS FROM CONTINUING OPERATIONS BEFORE TAXES AND
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE (18,080)
(17,611) (25,147) (51,070) Income tax benefit -- -- -- 7 NET LOSS
BEFORE CUMULATIVE EFFECT IN CHANGE IN ACCOUNTING PRINCIPLE (18,080)
(17,611) (25,147) (51,063) Cumulative effect of change in
accounting principle -- -- -- (2,306) NET LOSS (18,080) (17,611)
(25,147) (53,369) Other comprehensive loss 333 78 (526) (319)
COMPREHENSIVE LOSS $(17,747) $(17,533) $(25,673) $(53,688) BASIC
AND DILUTED LOSS PER SHARE: Weighted average number of shares of
common stock outstanding 213,261 183,102 213,217 153,679 Net loss
per common share before cumulative effect of change in accounting
principle $(0.08) $(0.10) $(0.12) $(0.33) Cumulative effect of
change in accounting principle -- -- -- (0.02) Net loss per common
share $(0.08) $(0.10) $(0.12) $(0.35) COEUR D'ALENE MINES
CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) Three Months Ended Nine Months Ended September 30,
September 30, 2004 2003 2004 2003 Restated Restated (In Thousands)
CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $(18,080) $(17,611)
$(25,147) $(53,369) Add (deduct) non-cash items: Depreciation and
depletion 4,862 3,257 14,481 12,955 Loss on early retirement of
debt -- 5,769 -- 33,957 (Gain) loss on embedded derivative (1,395)
(323) 362 346 Non-cash interest expense -- 7,088 -- 8,191
Cumulative effect of change in accounting principle -- -- -- 2,306
Compensation expense on restricted stock 321 302 994 520 Other
charges 370 55 1,567 569 Changes in Operating Assets and
Liabilities: Receivables 3,277 3,116 1,211 (247) Prepaid expenses
and other (74) (4,492) (388) (3,798) Inventories (7,406) 612
(16,954) (4,624) Accounts payable and accrued liabilities 11,175
2,029 9,812 (1,341) CASH USED IN OPERATING ACTIVITIES (6,950) (198)
(14,062) (4,535) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of
short-term investments (1,107) (9,303) (59,950) (82,256) Proceeds
from sales of short-term investments 10,521 8,618 23,232 80,128
Capital expenditures (2,732) (7,391) (5,858) (15,102) Other 41 312
278 225 CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES 6,723
(7,764) (42,298) (17,005) CASH FLOWS FROM FINANCING ACTIVITIES:
Retirement of long-term debt -- (61) (9,561) (22,453) Retirement of
building loan -- -- (1,200) -- Proceeds from issuance of
subordinated notes -- -- 180,000 -- Debt issuance costs -- --
(6,089) 33,268 Proceeds from issuance of common stock -- 75,998 --
87,498 Bank Borrowings on working capital facility -- 6,265 6,056
22,868 Payments to Bank on working capital facility -- (6,810)
(8,423) (21,714) Common stock repurchase -- -- (793) -- Other 1,424
(32) 9 (95) CASH PROVIDED BY FINANCING ACTIVITIES: 1,424 75,360
159,999 99,372 INCREASE IN CASH AND CASH EQUIVALENTS 1,197 67,398
103,639 77,832 Cash and cash equivalents at beginning of period
164,859 19,527 62,417 9,093 Cash and cash equivalents at end of
period $166,056 $86,925 $166,056 $86,925 DATASOURCE: Coeur d'Alene
Mines Corporation CONTACT: Tony Ebersole, Investor Relations of
Coeur d'Alene Mines Corporation, 800-523-1535 Web site:
http://www.coeur.com/
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