Coeur Reports Second Quarter 2015 Results
(Thomson Reuters ONE) -
NEWS RELEASE
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Coeur Reports Second Quarter 2015 Results
Raising 2015 Production Guidance and Lowering 2015 Cost Guidance
Adjusted Costs Applicable to Sales Declined 8% to $12.56 per Silver Equivalent
Ounce
Chicago, Illinois - August 4, 2015 - Coeur Mining, Inc. (the "Company" or
"Coeur") (NYSE: CDE) reported second quarter 2015 revenue of $166.3 million,
adjusted EBITDA(1) of $34.7 million, adjusted net loss(1) of $0.11 per share,
and cash flow from operating activities of $36.9 million. Adjusted costs
applicable to sales per silver equivalent ounce(1) of $12.56 declined 8% from
the first quarter. Adjusted all-in sustaining costs declined 6% from the first
quarter to $16.60 per silver equivalent ounce(1), the lowest level in over two
years of reporting this metric.
"In the second quarter we achieved the strongest financial performance in two
years despite the weakest realized silver and gold prices over this time frame,"
said Mitchell J. Krebs, Coeur's President and Chief Executive Officer. "With
nearly every mine outperforming initial cost and production targets, we are
raising our production guidance and lowering our cost guidance for 2015. The
notable exception is San Bartolomé, where July production was impacted by
political disruptions in Bolivia, but is now fully operational.
"I am proud of the progress our employees are making to lower our costs and add
high-quality silver and gold ounces to our production profile. However, we have
our sights set on higher goals in the coming quarters. In June, we provided a
three-year outlook reflecting further cost reductions, quality production
growth, and rising EBITDA and free cash flow starting next year. With more than
$200 million in liquidity at quarter end and long-dated debt maturities on our
balance sheet, we are well-positioned to continue executing our strategy even at
current metal prices."
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Second Quarter 2015 Highlights
* Silver production was 4.3 million ounces and gold production was 80,855
ounces, or 9.1 million silver equivalent(1) ounces, a 13% increase as
previously announced on July 9, 2015
* Adjusted costs applicable to sales were $12.56 and adjusted all-in
sustaining costs were $16.60 per silver equivalent ounce(1), the lowest
level since Coeur began reporting this metric in 2013
* Adjusted costs applicable to sales per gold ounce(1) at Kensington of $745
fell 7% from the first quarter
* Adjusted costs applicable to sales per silver equivalent ounce(1) at
Palmarejo declined 9% from the first quarter to $13.21
* Adjusted costs applicable to sales per silver equivalent ounce(1) at
Rochester were $12.01, down 7% from the first quarter
* Adjusted costs applicable to sales per silver ounce(1) at San Bartolomé
dropped 8% from the first quarter to $13.26
* Completed the acquisition of Paramount Gold and Silver Corp. and announced
an 89% increase in silver reserves and a 76% increase in gold reserves at
Palmarejo at a 31% higher average silver grade
* On June 24, Coeur announced a 39% increase in Wharf's gold reserves. The
addition of Wharf represents a 35% increase in Coeur's total gold reserves
* On June 25, Coeur closed a new $100 million, five-year, senior secured term
loan and repaid a pre-existing $50 million bridge loan due in the first
quarter of 2016
* Cash, cash equivalents, and short-term investments were $205.9 million at
June 30
Full Year 2015 Outlook
Coeur is raising its 2015 total production guidance by approximately 2% to 33.1
- 35.9 million silver-equivalent ounces, consisting of 14.7 - 15.8 million
silver ounces and 306,000 - 335,000 gold ounces. Coeur is also lowering its
guidance for all-in sustaining costs per silver equivalent ounce(1) by
approximately 3% to $17.00 - $18.00. The revised guidance is mainly due to
stronger than planned production at lower than expected costs at Palmarejo and
Kensington, partially offset by lower than expected production at San Bartolomé,
which experienced a temporary cessation of mining activity in July due to
political disruptions in Bolivia.
2015 Production Outlook
(silver and silver
equivalent ounces in Total Silver
thousands) Silver Gold Equivalent
-------------------------------------------------------------------------------
Palmarejo 4,200 - 4,700 62,000 - 67,000 7,920 - 8,720
San Bartolomé 5,300 - 5,500 - 5,300 - 5,500
Rochester 4,700 - 5,000 55,000 - 65,000 8,000 - 8,900
Endeavor 500 - 600 - 500 - 600
Kensington - 115,000 - 125,000 6,900 - 7,500
Wharf - 74,000 - 78,000 4,440 - 4,680
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Total 14,700 - 15,800 306,000 - 335,000 33,060 - 35,900
-------------------------------------------------------------------------------
2015 Cost Outlook
(dollars in millions, except per ounce
amounts) New 2015 Guidance Old 2015 Guidance
-------------------------------------------------------------------------------
Costs Applicable to Sales per Silver
Equivalent Ounce(1) - Palmarejo $15.00 - $16.00 $16.25 - $17.75
Costs Applicable to Sales per Silver
Ounce(1) - San Bartolomé $13.50 - $15.00 $13.50 - $15.00
Costs Applicable to Sales per Silver
Equivalent Ounce(1) - Rochester $12.50 - $14.00 $12.50 - $14.00
Costs Applicable to Sales per Gold Ounce -
Kensington $850 - $900 $900 - $975
Costs Applicable to Sales per Gold
Equivalent Ounce(1) - Wharf $750 - $825 $750 - $825
Capital Expenditures $95 - $105 $95 - $105
General and Administrative Expenses $36 - $39 $36 - $39
Exploration Expense $13 - $16 $13 - $16
All-in Sustaining Costs per Silver
Equivalent Ounce(1) $17.00 - $18.00 $17.50 - $18.50
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Financial Highlights (Unaudited)
+---------+
(Amounts in millions, | |
except per share amounts,| |
gold ounces produced & | |
sold, and per-ounce | |
metrics) | 2Q 2015 | 1Q 2015 4Q 2014 3Q 2014 2Q 2014
+---------+------------------------------------------
Revenue |$ 166.3 |$ 153.0 $ 140.6 $ 170.9 $ 164.6
| |
Costs Applicable to Sales|$ 119.1 |$ 115.1 $ 126.5 $ 125.9 $ 118.7
| |
General and | |
Administrative Expenses |$ 8.5 |$ 8.8 $ 9.0 $ 8.5 $ 9.4
| |
Adjusted EBITDA(1) |$ 34.7 |$ 23.7 $ 7.8 $ 30.7 $ 32.9
| |
Net Income (Loss) |$ (16.7 )|$ (33.3 ) $ (1,079.1 ) $ 3.5 $ (43.1 )
| |
Net Income (Loss) Per | |
Share |$ (0.12 )|$ (0.32 ) $ (10.53 ) $ 0.03 $ (0.42 )
| |
Adjusted Net Income | |
(Loss)(1) |$ (14.5 )|$ (22.7 ) $ (37.5 ) $ (18.5 ) $ (21.5 )
| |
Adjusted Net Income | |
(Loss)(1 )Per Share |$ (0.11 )|$ (0.22 ) $ (0.37 ) $ (0.18 ) $ (0.21 )
| |
Weighted Average Shares | 135.0 | 102.6 102.4 102.6 102.4
| |
Cash Flow From Operating | |
Activities |$ 36.9 |$ (4.0 ) $ 0.7 $ 31.3 $ 30.5
| |
Capital Expenditures |$ 23.7 |$ 17.6 $ 20.1 $ 16.8 $ 15.4
| |
Cash, Equivalents & | |
Short-Term Investments |$ 205.9 |$ 179.6 $ 270.9 $ 295.4 $ 316.8
| |
Total Debt(2) |$ 547.7 |$ 513.5 $ 468.5 $ 469.5 $ 480.1
| |
Average Realized Price | |
Per Ounce - Silver |$ 16.23 |$ 16.77 $ 16.40 $ 19.46 $ 19.60
| |
Average Realized Price | |
Per Ounce - Gold |$ 1,179 |$ 1,204 $ 1,186 $ 1,260 $ 1,277
| |
Silver Ounces Produced | 4.3 | 3.8 4.3 4.3 4.5
| |
Gold Ounces Produced | 80,855 | 69,734 64,534 64,989 61,025
| |
Silver Equivalent Ounces | |
Produced(1) | 9.1 | 8.0 8.3 8.2 8.1
| |
Silver Ounces Sold | 4.0 | 4.1 4.6 4.3 4.6
| |
Gold Ounces Sold | 84,312 | 68,420 52,785 69,541 57,751
| |
Silver Equivalent Ounces | |
Sold(1) | 9.1| 8.2 7.9 8.4 8.1
| |
Adjusted Costs Applicable| |
to Sales per AgEq Oz(1) |$ 12.56 |$ 13.71 $ 14.43 $ 14.19 $ 14.00
| |
Adjusted Costs Applicable| |
to Sales per AuEq Oz(1) |$ 816 |$ 797 $ 792 $ 889 $ 821
| |
Adjusted All-in | |
Sustaining Costs per AgEq| |
Oz(1) |$ 16.60 |$ 17.66 $ 19.25 $ 18.27 $ 19.10
+---------+
Financial Results
Second quarter 2015 revenue increased $13.3 million, or 9%, compared with the
first quarter to $166.3 million due to a 10% increase in silver equivalent
ounces sold, partially offset by lower metal prices. Average realized silver and
gold prices decreased 3% and 2%, respectively, compared to the first quarter, to
$16.23 per ounce for silver and $1,179 per ounce for gold. Silver contributed
40% of metal sales and gold contributed 60% during the second quarter.
General and administrative expenses decreased 4% from the first quarter to $8.5
million in the second quarter, and were down 9% compared to the second quarter
of 2014. Capital expenditures of $23.7 million in the second quarter increased
$6.1 million, or 34%, compared to the first quarter due to the inclusion of
Wharf for the full quarter as well as higher spending for underground
development at Kensington, Guadalupe mine development and additional tailings
capacity at Palmarejo, and expanded crushing capacity and increased Stage III
leach pad capacity at Rochester. For the first six months of 2015, general and
administrative expenses were $17.3 million and capital expenditures were $41.3
million.
Second quarter adjusted EBITDA(1) was $34.7 million and adjusted net loss(1) was
$14.5 million, or $0.11 per share, a 46% increase in adjusted EBITDA(1) from
$23.7 million and an $8.0 million improvement in adjusted net loss from $22.7
million, or $0.22 per share, in the first quarter mainly due to higher
production and lower unit operating costs.
Coeur obtained a five-year $100 million senior secured term loan and repaid a
$50 million short-term bridge loan during the second quarter, which raised total
debt to $547.7 million at June 30, including $426.2 million in senior unsecured
notes due in 2021. Cash, cash equivalents, and short-term investments totaled
$205.9 million at the end of the second quarter, yielding a net debt balance of
$341.8 million, a 2% increase compared to March 31.
Operations
Highlights of second quarter 2015 results for each of the Company's operating
segments are provided below.
Palmarejo, Mexico
+-------+
(Dollars in millions, except per ounce| |
amounts) |2Q 2015|1Q 2015 4Q 2014 3Q 2014 2Q 2014
+-------+-------------------------------
Underground Operations: | |
| |
Tons mined |172,730|149,150 187,730 169,656 177,359
| |
Average silver grade (oz/t) | 3.90 | 4.34 4.49 4.88 6.15
| |
Average gold grade (oz/t) | 0.09 | 0.07 0.06 0.10 0.11
| |
Surface Operations: | |
| |
Tons mined |257,862|281,481 320,802 343,001 320,583
| |
Average silver grade (oz/t) | 3.47 | 3.79 2.90 3.09 3.72
| |
Average gold grade (oz/t) | 0.03 | 0.04 0.03 0.03 0.03
| |
Processing: | |
| |
Total tons milled |435,841|451,918 510,813 518,212 534,718
| |
Average recovery rate - Ag | 78.5% | 78.7% 80.2% 82.7% 75.6%
| |
Average recovery rate - Au | 76.2% | 73.9% 78.7% 86.9% 78.9%
| |
Silver ounces produced (000's) | 1,247 | 1,354 1,444 1,533 1,761
| |
Gold ounces produced |18,127 |15,495 15,237 22,514 23,706
| |
Silver equivalent ounces produced(1 | |
)(000's) | 2,335 | 2,284 2,359 2,883 3,183
| |
Silver ounces sold (000's) | 1,228 | 1,330 1,375 1,605 1,983
| |
Gold ounces sold |15,706 |13,793 16,255 23,600 25,753
| |
Silver equivalent ounces sold(1 | |
)(000's) | 2,170 | 2,158 2,350 3,021 3,528
| |
Revenues | $38.9 | $39.4 $42.2 $61.4 $72.4
| |
Costs applicable to sales | $30.1 | $34.5 $48.1 $46.0 $49.6
| |
Adjusted costs applicable to sales per| |
AgEq ounce(1) |$13.21 |$14.56 $15.70 $14.43 $13.48
| |
Exploration expense | $1.8 | $1.1 $1.5 $2.6 $1.6
| |
Cash flow from operating activities | $9.7 |$(0.2) $(3.2) $20.2 $27.4
| |
Sustaining capital expenditures | $2.7 | $3.1 $5.5 $1.9 $5.3
| |
Development capital expenditures | $8.0 | $6.1 $5.4 $4.0 $0.3
+-------+-------------------------------
Total capital expenditures | $10.7 | $9.2 $10.9 $5.9 $5.6
| |
Free cash flow (before royalties) |$(1.0) |$(9.4) $(14.1) $14.3 $21.8
| |
Royalties paid | $9.8 | $10.4 $10.0 $11.4 $12.3
| |
Free cash flow(3) |$(10.8)|$(19.8) $(24.1) $2.9 $9.5
+-------+
* Adjusted costs applicable to sales per silver equivalent ounce(1) of $13.21
decreased 9% from the first quarter due to lower underground mining costs,
which also represented a higher proportion of production. Underground mining
costs of $44 per ton quarter declined more than 30% from $64 per ton in the
first quarter
* Palmarejo continues the transition to underground mining at the Guadalupe
mine and the Independencia mine (expected beginning early 2016) while mining
activities in the historic zones gradually decline. Open-pit mining is
expected to end during the second half of 2015
* Development of the tunnel to Independencia is on track and expected to reach
the ore body by the end of 2015
* Raising 2015 production guidance by approximately 9% to 4.2 - 4.7 million
ounces of silver and 62,000 - 67,000 ounces of gold from 3.9 - 4.3 million
ounces of silver and 55,000 - 65,000 ounces of gold, while lowering costs
applicable to sales per silver equivalent ounce(1) guidance by approximately
9% to $15.00 - $16.00 from $16.25 - $17.75
Rochester, Nevada
+---------+
(Dollars in millions, except| |
per ounce amounts) | 2Q 2015 | 1Q 2015 4Q 2014 3Q 2014 2Q 2014
+---------+---------------------------------------
Ore tons placed |3,859,965|4,013,879 3,876,944 3,892,421 3,329,582
| |
Average silver grade (oz/t) | 0.61 | 0.74 0.60 0.51 0.58
| |
Average gold grade (oz/t) | 0.003 | 0.004 0.004 0.005 0.003
| |
Silver ounces produced | |
(000's) | 1,294 | 1,144 1,170 1,156 1,112
| |
Gold ounces produced | 16,411 | 13,721 15,764 11,702 9,230
| |
Silver equivalent ounces | |
produced(1 )(000's) | 2,279 | 1,967 2,116 1,858 1,666
| |
Silver ounces sold (000's) | 1,120 | 1,351 1,154 1,067 1,006
| |
Gold ounces sold | 15,085 | 17,754 14,131 8,932 8,970
| |
Silver equivalent ounces | |
sold(1 )(000's) | 2,025 | 2,416 2,002 1,603 1,544
| |
Revenues | $36.3 | $44.0 $36.0 $32.4 $31.2
| |
Costs applicable to sales | $24.4 | $31.4 $28.7 $23.7 $24.4
| |
Adjusted costs applicable to| |
sales per silver equivalent | |
ounce(1) | $12.01 | $12.95 $13.82 $14.78 $15.73
| |
Exploration expense | $0.5 | $0.7 $0.6 $0.1 $0.7
| |
Cash flow from operating | |
activities | $8.8 | $16.4 $10.2 $8.2 $4.3
| |
Sustaining capital | |
expenditures | $2.4 | $0.8 $2.7 $4.2 $4.0
| |
Development capital | |
expenditures | $3.5 | $2.5 $- $- $-
+---------+---------------------------------------
Total capital expenditures | $5.9 | $3.3 $2.7 $4.2 $4.0
| |
Free cash flow(3) | $2.9 | $13.1 $7.5 $4.0 $0.3
+---------+
* Second quarter adjusted costs applicable to sales per silver equivalent
ounce(1) were $12.01, down 7% from the first quarter due to lower crushing
and leaching costs. Mining costs per ton of $1.39 declined 9% from $1.53 per
ton in the first quarter
* Operating cash flow of $8.8 million declined from the first quarter due to
an increase in metal inventory and a decrease in accounts payable
* Expected completion of the crushing capacity expansion and increased Stage
III leach pad capacity during the third quarter
* Approval for POA 10 (expansion of Stage IV leach pad and construction of new
Stage V leach pad) is expected by early 2016. Minimal preparatory work for
the Stage V leach pad expected in 2016 with major construction activity
planned for 2017
* In 2015, Rochester is expected to produce 4.7 - 5.0 million ounces of silver
and 55,000 - 65,000 ounces of gold at costs applicable to sales per silver
equivalent ounce(1) of $12.50 - $14.00
Kensington, Alaska
+-------+
(Dollars in millions, except per ounce| |
amounts) |2Q 2015|1Q 2015 4Q 2014 3Q 2014 2Q 2014
+-------+-------------------------------
Tons milled |170,649|164,951 167,417 145,097 163,749
| |
Average gold grade (oz/t) | 0.18 | 0.24 0.21 0.23 0.18
| |
Average recovery rate | 94.9% | 94.8% 94.2% 93.0% 94.5%
| |
Gold ounces produced |29,845 |33,909 33,533 30,773 28,089
| |
Gold ounces sold |36,607 |36,873 22,399 37,009 23,028
| |
Revenues | $42.5 | $44.0 $26.0 $45.9 $29.0
| |
Costs applicable to sales | $27.5 | $29.4 $18.9 $34.7 $23.2
| |
Adjusted costs applicable to sales per| |
gold ounce(1) | $745 | $797 $792 $889 $821
| |
Exploration expense | $0.4 | $1.7 $2.8 $2.6 $1.6
| |
Cash flow from operating activities | $12.0 | $12.3 $(3.7) $17.0 $(0.6)
| |
Sustaining capital expenditures | $4.2 | $4.1 $3.3 $3.6 $4.0
| |
Development capital expenditures | $0.5 | $- $0.6 $- $-
+-------+-------------------------------
Total capital expenditures | $4.7 | $4.1 $3.9 $3.6 $4.0
| |
Free cash flow(3) | $7.3 | $8.2 $(7.6) $13.4 $(4.6)
+-------+
* Strong mill throughput of approximately 1,875 tons per day and lower diesel
and mining costs ($51 per ton, down from $55 per ton in the first quarter)
caused a 7% decline in adjusted costs applicable to sales per gold ounce(1)
to $745 in the second quarter. Mining costs per ton declined 7% to $51 from
$55 in the first quarter
* Development of the decline into the high-grade Jualin deposit is now
underway. Underground drilling at Jualin is expected to begin in early 2016
* Raising 2015 production guidance and lowering 2015 cost guidance to 115,000
- 125,000 ounces of gold at costs applicable to sales per gold ounce of $850
- $900, improved approximately 7% from prior guidance of 110,000 - 115,000
ounces of gold at costs applicable to sales per gold ounce of $900 - $975
San Bartolomé, Bolivia
+-------+
(Dollars in millions, except per ounce| |
amounts) |2Q 2015|1Q 2015 4Q 2014 3Q 2014 2Q 2014
+-------+-------------------------------
Tons milled |457,232|406,951 454,135 471,938 437,975
| |
Average silver grade (oz/t) | 3.73 | 3.65 3.77 3.70 3.87
| |
Average recovery rate | 87.6% | 81.6% 88.0% 86.5% 87.5%
| |
Silver ounces produced (000's) | 1,495 | 1,213 1,507 1,509 1,481
| |
Silver ounces sold (000's) | 1,439 | 1,290 1,987 1,438 1,494
| |
Revenues | $23.4 | $21.5 $32.6 $28.4 $29.1
| |
Costs applicable to sales | $19.2 | $19.1 $29.6 $20.4 $20.7
| |
Adjusted costs applicable to sales per| |
silver ounce(1) |$13.26 |$14.47 $14.38 $13.67 $13.85
| |
Exploration expense | $- | $- $- $- $0.1
| |
Cash flow from operating activities | $5.4 | $5.0 $2.3 $12.3 $18.9
| |
Sustaining capital expenditures | $1.0 | $0.9 $2.0 $2.8 $1.7
| |
Development capital expenditures | $- | $- $- $- $-
+-------+-------------------------------
Total capital expenditures | $1.0 | $0.9 $2.0 $2.8 $1.7
| |
Free cash flow(3) | $4.4 | $4.1 $0.3 $9.5 $17.2
+-------+
* Higher throughput, grade and recovery resulted in higher production and an
8% decline in adjusted costs applicable to sales per silver ounce to $13.26
* On July 10, political protests in Potosi, Bolivia prompted a temporary
cessation of mining activity at San Bartolomé. Processing activities were
restarted on July 31 and mining activities have fully resumed. As a result,
2015 production guidance has been lowered to 5.3 - 5.5 million ounces of
silver, down from 5.8 - 6.1 million previously while maintaining costs
applicable to sales guidance of $13.50 - $15.00 per silver equivalent
ounce(1)
Wharf, South Dakota
+-------+
(Dollars in millions, except per ounce| |
amounts) |2Q 2015|1Q 2015 4Q 2014 3Q 2014 2Q 2014
+-------+-------------------------------
Ore tons placed |887,409|415,996 - - -
| |
Average gold grade (oz/t) | 0.025 | 0.020 - - -
| |
Gold equivalent ounces produced(1) |16,794 | 6,609 - - -
| |
Gold equivalent ounces sold(1) |17,131 | - - - -
| |
Revenues | $20.4 | $- - - -
| |
Costs applicable to sales | $16.6 | $- - - -
| |
Adjusted costs applicable to sales per| |
gold equivalent ounce(1) | $970 | $- - - -
| |
Exploration expense | $- | $- - - -
| |
Cash flow from operating activities | $8.2 |$(7.2) - - -
| |
Sustaining capital expenditures | $1.2 | $0.1 - - -
| |
Development capital expenditures | $- | $- - - -
+-------+-------------------------------
Total capital expenditures | $1.2 | $0.1 - - -
| |
Free cash flow(3) | $7.0 |$(7.3) - - -
+-------+
* The second quarter was the first full quarter of operating results since the
acquisition closed on February 20, 2015
* In June, Coeur announced a 39% increase in Wharf's gold reserves. A
technical report was filed today, reflecting an after-tax NPV(10%) of $138
million based on the current mine plan, average annual gold production of
almost 90,000 ounces, and average annual operating cash flow of more than
$30 million
* Significantly higher production is expected in the second half of 2015 at
lower unit costs mainly due to higher mining rates. For the full year, Wharf
is expected to produce 74,000 - 78,000 ounces of gold at costs applicable to
sales per gold equivalent ounce(1) of $750 - $825. Capital expenditures are
expected to be approximately $3.0 million in 2015
Coeur Capital
+-------+
(Dollars in millions, except per ounce| |
amounts) |2Q 2015|1Q 2015 4Q 2014 3Q 2014 2Q 2014
+-------+-------------------------------
Tons milled |191,175|185,299 214,180 199,757 185,538
| |
Average silver grade (oz/t) | 2.35 | 1.69 1.99 1.44 1.41
| |
Average recovery rate | 45.4% | 42.4% 44.9% 49.1% 42.4%
| |
Silver ounces produced (000's) | 204 | 133 191 141 111
| |
Silver ounces sold (000's) | 209 | 118 192 141 106
| |
Metal sales | $3.1 | $1.9 $2.7 $2.4 $2.0
| |
Royalty revenue | $1.8 | $2.0 $0.7 $0.6 $0.9
| |
Costs applicable to sales (Endeavor | |
silver stream) | $1.4 | $0.6 $1.1 $1.1 $0.8
| |
Costs applicable to sales per silver | |
equivalent ounce(1) | $6.46 | $5.37 $5.69 $7.71 $7.94
| |
Cash flow from operating activities | $2.1 | $2.2 $1.5 $2.4 $0.8
| |
Free cash flow(3) | $2.1 | $2.2 $1.5 $2.4 $0.8
+-------+
* There are five cash-flowing royalties and streams, four non-cash-flowing
royalties, and several investments in junior mining companies held in Coeur
Capital or its affiliates
* Coeur Capital's largest source of cash flow is the silver stream on the
Endeavor mine in New South Wales, Australia in which the Company owns 100%
of the silver up to a total of 20.0 million payable ounces. At June
30, 2015, the Company has received 5.8 million ounces, or 29.0% of the total
Exploration
Costs associated with exploration activities for the second quarter of 2015 were
$3.6 million (expensed) for discovery of new silver and gold mineralization and
$2.2 million (capitalized) for definition and expansion of mineralized material.
These amounts compare to exploration costs of $4.3 million expensed and $4.0
million capitalized in the first quarter. Coeur's exploration program used 11
drill rigs during the second quarter: 4 drills at Palmarejo, 3 at Kensington, 3
at Rochester, and 1 at Wharf. This work resulted in completion of over 120,131
feet (36,616 meters) of combined core and reverse circulation drilling.
Exploration expenses are expected to total $13 - $16 million in 2015, with
additional capital allocated to resource conversion. Coeur will continue to use
a success-based approach to funding exploration activities, with a near-term
focus on higher grade targets at Palmarejo at and near the Guadalupe operation,
drilling near-surface oxide targets at La Preciosa, drilling new targets near
Wharf, mapping and sampling around Rochester and Kensington, and the selective
acquisition and maintenance of early-stage projects.
Conference Call Information
Coeur will conduct a conference call and webcast at www.coeur.com to discuss the
Company's second quarter results on August 5, 2015 at 11:00 a.m. Eastern time.
Dial-In Numbers: (855) 560-2581 (US)
(855) 669-9657 (Canada)
(412) 542-4166 (International)
Conference ID: Coeur Mining, Inc.
A replay of the call will be available on Coeur's website through August
19, 2015.
Replay Numbers: (877) 344-7529 (US)
(855) 669-9658 (Canada)
(412) 317-0088 (International)
Conference ID: 100 68 701
About Coeur
Coeur Mining is the largest U.S.-based silver producer and a significant gold
producer with five precious metals mines in the Americas employing approximately
2,100 people. Coeur produces from its wholly owned operations: the Palmarejo
silver-gold mine in Mexico, the San Bartolomé silver mine in Bolivia, the
Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska, and
the Wharf gold mine in South Dakota. The Company also has a non-operating
interest in the Endeavor mine in Australia in addition to royalties on the Cerro
Bayo mine in Chile, the El Gallo complex in Mexico, the Zaruma mine in Ecuador,
and the Correnso mine in New Zealand. In addition, the Company has two silver-
gold exploration projects - the La Preciosa project in Mexico and the Joaquin
project in Argentina. The Company also conducts ongoing exploration activities
in Alaska, Argentina, Bolivia, Mexico, and Nevada. The Company owns strategic
investment positions in several silver and gold development companies with
projects in North and South 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 production, costs, EBITDA, cash flow, capital
expenditures, expenses, mining rates, operations at Palmarejo, approval for POA
10, planned capital and expansion projects at Rochester, anticipated returns at
Wharf, development activity at Kensington, and exploration efforts. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause Coeur's actual results, performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, the risk that anticipated benefits of recent
acquisitions are not realized, the risk that anticipated production, EBITDA,
cash flow, and cost levels are not attained, the risks and hazards inherent in
the mining business (including risks inherent in developing large-scale mining
projects, environmental hazards, industrial accidents, weather or geologically
related conditions), changes in the market prices of gold and silver and a
sustained lower price environment, the uncertainties inherent in Coeur's
production, exploratory and developmental activities, including risks relating
to permitting and regulatory delays, ground conditions, grade variability, any
future labor disputes or work stoppages (including those involving third
parties), the uncertainties inherent in the estimation of gold and silver
reserves and resources, changes that could result from Coeur's future
acquisition of new mining properties or businesses, the absence of control over
and reliance on third parties to operate mining operations in which Coeur or its
subsidiaries hold royalty or streaming interests and risks related to these
mining operations including results of mining and exploration activities,
environmental, economic and political risks of the jurisdiction in which the
mining operations are located, the loss of access to any third-party smelter to
which Coeur markets silver and gold, the effects of environmental and other
governmental regulations, the risks inherent in the ownership or operation of or
investment in mining properties or businesses in foreign countries, 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.
W. David Tyler, Coeur's Vice President, Technical Services and a qualified
person under Canadian National Instrument 43-101, supervised the preparation of
the scientific and technical information concerning Coeur's mineral projects in
this news release. For a description of the key assumptions, parameters and
methods used to estimate mineral reserves and resources, as well as data
verification procedures and a general discussion of the extent to which the
estimates may be affected by any known environmental, permitting, legal, title,
taxation, socio-political, marketing or other relevant factors, Canadian
investors should refer to the Technical Reports for each of Coeur's properties
as filed on SEDAR at www.sedar.com.
Non-U.S. GAAP Measures
We supplement the reporting of our financial information determined under United
States generally accepted accounting principles (U.S. GAAP) with certain non-
U.S. GAAP financial measures, including adjusted EBITDA, adjusted net income
(loss), costs applicable to sales per silver equivalent ounce (or per gold
equivalent ounce), adjusted costs applicable to sales per silver equivalent
ounce, all-in sustaining costs, and adjusted all-in sustaining costs. We believe
that these adjusted measures provide meaningful information to assist
management, investors and analysts in understanding our financial results and
assessing our prospects for future performance. We believe these adjusted
financial measures are important indicators of our recurring operations because
they exclude items that may not be indicative of, or are unrelated to our core
operating results, and provide a better baseline for analyzing trends in our
underlying businesses. We believe adjusted EBITDA, adjusted net income (loss),
costs applicable to sales per silver equivalent ounce (or per gold equivalent
ounce), adjusted costs applicable to sales per silver equivalent ounce, all-in
sustaining costs, and adjusted all-in sustaining costs are important measures in
assessing the Company's overall financial performance.
Notes
1. Adjusted EBITDA, adjusted net income (loss), all-in sustaining costs,
adjusted all-in sustaining costs, costs applicable to sales per silver
equivalent ounce (or per gold equivalent ounce), and adjusted costs applicable
to sales per silver equivalent ounce are non-GAAP measures. Please see tables in
the Appendix for the reconciliation to U.S. GAAP. For purposes of silver and
gold equivalence, 60:1 silver to gold ratio.
2. Includes capital leases. Net of debt discount.
3. Free cash flow is defined as cash flow from operating activities less capital
expenditures and royalty payments.
For Additional Information:
Bridget Freas, Director, Investor Relations
(312) 489-5819
Donna Mirandola, Director, Corporate Communications
(312) 489-5842
www.coeur.com
Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Loss)
Three months ended June
30, Six months ended June 30,
--------------------------- --------------------------
2015 2014 2015 2014
------------- ------------- ------------- ------------
In thousands, except share data
Revenue $ 166,263 $ 164,562 $ 319,219 $ 324,195
COSTS AND EXPENSES
Costs applicable to
sales 119,097 118,687 234,160 225,583
Amortization 38,974 41,422 72,064 81,849
General and
administrative 8,451 9,398 17,286 23,294
Exploration 3,579 5,153 7,845 9,370
Pre-development,
reclamation, and other 2,267 8,760 9,030 15,775
------------- ------------- ------------- ------------
Total costs and expenses 172,368 183,420 340,385 355,871
OTHER INCOME (EXPENSE),
NET
Fair value adjustments,
net 2,754 (8,282 ) (2,130 ) (19,717 )
Impairment of equity
securities (31 ) (934 ) (1,545 ) (3,522 )
Interest income and
other, net (2,821 ) (116 ) (3,817 ) (2,100 )
Interest expense, net of
capitalized interest (10,734 ) (12,310 ) (21,499 ) (25,365 )
------------- ------------- ------------- ------------
Total other income
(expense), net (10,832 ) (21,642 ) (28,991 ) (50,704 )
------------- ------------- ------------- ------------
Income (loss) before
income and mining taxes (16,937 ) (40,500 ) (50,157 ) (82,380 )
Income and mining tax
(expense) benefit 260 (2,621 ) 192 2,068
------------- ------------- ------------- ------------
NET INCOME (LOSS) $ (16,677 ) $ (43,121 ) $ (49,965 ) $ (80,312 )
------------- ------------- ------------- ------------
OTHER COMPREHENSIVE
INCOME (LOSS), net of
tax:
Unrealized gain (loss)
on equity securities,
net of tax of $7 for the
three months ended June
30, 2015 and $487 and
$253 for the three and
six months ended June
30, 2014, respectively (1,312 ) (773 ) (2,813 ) (401 )
Reclassification
adjustments for
impairment of equity
securities, net of tax
of $(362) and $(1,363)
for the three and six
months ended June
30, 2014, respectively 31 572 1,545 2,159
Reclassification
adjustments for realized
loss on sale of equity
securities, net of tax
of $(10) for the three
and six months ended
June 30, 2014,
respectively 904 17 904 17
------------- ------------- ------------- ------------
Other comprehensive
income (loss) (377 ) (184 ) (364 ) 1,775
------------- ------------- ------------- ------------
COMPREHENSIVE INCOME
(LOSS) $ (17,054 ) $ (43,305 ) $ (50,329 ) $ (78,537 )
------------- ------------- ------------- ------------
NET INCOME (LOSS) PER
SHARE
Basic $ (0.12 ) $ (0.42 ) $ (0.42 ) $ (0.78 )
------------- ------------- ------------- ------------
Diluted $ (0.12 ) $ (0.42 ) $ (0.42 ) $ (0.78 )
------------- ------------- ------------- ------------
Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
Three months ended June
30, Six months ended June 30,
--------------------------- --------------------------
2015 2014 2015 2014
------------- ------------- ------------- ------------
In thousands
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net income (loss) $ (16,677 ) $ (43,121 ) $ (49,965 ) (80,312 )
Adjustments:
Amortization 38,974 41,422 72,064 81,849
Accretion 3,526 4,502 6,676 9,093
Deferred income taxes (5,053 ) (3,844 ) (7,237 ) (15,705 )
Loss on termination of
revolving credit
facility - - - 3,035
Fair value adjustments,
net (2,754 ) 8,282 2,130 19,717
Stock-based compensation 2,604 2,385 4,754 4,950
Impairment of equity
securities 31 934 1,545 3,522
Foreign exchange and
other 4,224 (54 ) 5,303 (869 )
Changes in operating
assets and liabilities:
Receivables (2,342 ) 4,921 214 10,544
Prepaid expenses and
other current assets 160 3,551 (1,167 ) (4,558 )
Inventory and ore on
leach pads 4,649 (1,606 ) 5,333 (15,519 )
Accounts payable and
accrued liabilities 9,521 13,118 (6,759 ) 5,117
------------- ------------- ------------- ------------
CASH PROVIDED BY
OPERATING ACTIVITIES 36,863 30,490 32,891 20,864
------------- ------------- ------------- ------------
CASH FLOWS FROM
INVESTING ACTIVITIES:
Capital expenditures (23,677 ) (15,356 ) (41,297 ) (27,292 )
Acquisitions, net of
cash acquired (9,152 ) (2,250 ) (111,170 ) (2,250 )
Other (103 ) 12 (1,676 ) (13 )
Purchase of short-term
investments and equity
securities (1,597 ) (2,139 ) (1,873 ) (48,360 )
Sales and maturities of
short-term investments 399 800 469 890
------------- ------------- ------------- ------------
CASH USED IN INVESTING
ACTIVITIES (34,130 ) (18,933 ) (155,547 ) (77,025 )
------------- ------------- ------------- ------------
CASH FLOWS FROM
FINANCING ACTIVITIES:
Issuance of notes and
bank borrowings 100,000 - 153,500 153,000
Payments on debt,
capital leases, and
associated costs (66,626 ) (2,851 ) (75,220 ) (6,962 )
Gold production royalty
payments (9,754 ) (12,345 ) (20,122 ) (27,028 )
Other (72 ) (160 ) (495 ) (406 )
------------- ------------- ------------- ------------
CASH PROVIDED BY (USED
IN) FINANCING ACTIVITIES 23,548 (15,356 ) 57,663 118,604
------------- ------------- ------------- ------------
INCREASE (DECREASE) IN
CASH AND CASH
EQUIVALENTS 26,281 (3,799 ) (64,993 ) 62,443
Cash and cash
equivalents at beginning
of period 179,587 272,932 270,861 206,690
------------- ------------- ------------- ------------
Cash and cash
equivalents at end of
period $ 205,868 $ 269,133 $ 205,868 $ 269,133
------------- ------------- ------------- ------------
Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
June 30, 2015 December 31,
(Unaudited) 2014
--------------- ----------------
ASSETS In thousands, except share data
CURRENT ASSETS
Cash and cash equivalents $ 205,868 $ 270,861
Receivables 112,159 116,921
Inventory 109,207 114,931
Ore on leach pads 67,458 48,204
Deferred tax assets 7,262 7,364
Prepaid expenses and other 17,442 15,523
--------------- ----------------
519,396 573,804
NON-CURRENT ASSETS
Property, plant and equipment, net 254,574 227,911
Mining properties, net 864,884 501,192
Ore on leach pads 32,663 37,889
Restricted assets 8,377 7,037
Equity securities 4,216 5,982
Receivables 26,738 21,686
Deferred tax assets 64,120 60,151
Other 11,681 9,915
--------------- ----------------
TOTAL ASSETS $ 1,786,649 $ 1,445,567
--------------- ----------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 42,522 $ 49,052
Accrued liabilities and other 47,590 51,513
Debt 9,121 17,498
Royalty obligations 41,999 43,678
Reclamation 3,786 3,871
Deferred tax liabilities 8,078 8,078
--------------- ----------------
153,096 173,690
NON-CURRENT LIABILITIES
Debt 538,589 451,048
Royalty obligations 12,675 27,651
Reclamation 87,538 66,943
Deferred tax liabilities 223,868 111,006
Other long-term liabilities 43,233 29,911
--------------- ----------------
905,903 686,559
STOCKHOLDERS' EQUITY
Common stock, par value $0.01 per share;
authorized 300,000,000 shares, issued and
outstanding 137,122,762 at June 30, 2015 and
authorized 150,000,000 shares, issued and
outstanding 103,384,408 at December 31, 2014 1,371 1,034
Additional paid-in capital 2,982,019 2,789,695
Accumulated other comprehensive income
(loss) (3,172 ) (2,808 )
Accumulated deficit (2,252,568 ) (2,202,603 )
--------------- ----------------
727,650 585,318
--------------- ----------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,786,649 $ 1,445,567
--------------- ----------------
Adjusted EBITDA Reconciliation
(Dollars in
thousands
except per
share
amounts) 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014
------------- ------------- ---------------- ------------ ------------
Net income
(loss) $ (16,677 ) $ (33,287 ) $ (1,079,038 ) $ 3,466 $ (43,121 )
Interest
expense, net
of
capitalized
interest 10,734 10,765 10,566 11,615 12,311
Interest
income and
other, net 2,821 997 (3,688 ) 213 4,083
Income tax
provision
(benefit) (260 ) 68 (440,594 ) (16,582 ) 2,621
Amortization 38,974 33,090 38,570 41,985 41,422
------------- ------------- ---------------- ------------ ------------
EBITDA 35,592 11,633 (1,474,184 ) 40,697 17,316
Fair value
adjustments,
net (2,754 ) 4,884 (7,229 ) (16,106 ) 8,281
Impairment
of equity
securities 31 1,514 1,979 1,092 934
Inventory
adjustments 1,805 3,684 14,482 4,993 6,353
Transaction-
related
costs 38 1,975 - - -
Write-downs - - 1,472,721 - -
------------- ------------- ---------------- ------------ ------------
Adjusted
EBITDA $ 34,712 $ 23,690 $ 7,769 $ 30,676 $ 32,884
------------- ------------- ---------------- ------------ ------------
Adjusted Net Income (Loss) Reconciliation
(Dollars in
thousands
except per
share amounts) 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014
------------- ------------- ---------------- ------------- ------------
Net income
(loss) $ (16,677 ) $ (33,287 ) $ (1,079,038 ) $ 3,466 $ (43,121 )
Fair value
adjustments,
net (2,618 ) 4,339 (5,622 ) (13,026 ) 6,498
Stock-based
compensation 2,529 2,410 1,807 2,417 2,299
Impairment of
equity
securities 31 1,514 1,979 1,092 934
Accretion of
royalty
obligation 1,147 1,315 1,992 1,374 1,789
Write-downs - - 1,021,756 - -
(Gain) loss on
debt
extinguishments 524 (253 ) (426 ) - -
Inventory
adjustments 1,805 3,684 14,482 4,993 6,353
Transaction-
related costs 38 1,975 - - -
Deferred tax
asset valuation
allowance 76 (3,464 ) - - -
Foreign
exchange (gain)
loss on
deferred taxes (1,305 ) (929 ) 5,615 (18,801 ) 3,711
------------- ------------- ---------------- ------------- ------------
Adjusted net
income (loss) $ (14,450 ) $ (22,696 ) $ (37,455 ) $ (18,485 ) $ (21,537 )
------------- ------------- ---------------- ------------- ------------
Adjusted net
income (loss)
per share $ (0.11 ) $ (0.22 ) $ (0.37 ) $ (0.18 ) $ (0.21 )
------------- ------------- ---------------- ------------- ------------
Reconciliation of Non-U.S. GAAP All-in Sustaining Costs per Silver Equivalent
Ounce
for Three Months Ended June 30, 2015
Silver Gold
------------------------------------------------------------ ----------------------------------
In thousands
except per
ounce San Total Total
amounts Palmarejo Bartolomé Rochester Endeavor Silver Kensington Wharf Total Gold Combined
------------------------------------------------------------ ---------------------------------------------
Costs
applicable
to sales,
including
amor-
tization
(U.S. GAAP) $ 39,158 $ 24,428 $ 37,076 $ 3,204 $ 103,866 $ 40,136 $ 20,123 $ 60,259 $ 164,125
Amor-
tization 9,046 5,271 12,684 1,852 28,853 12,684 3,491 16,175 45,028
------------------------------------------------------------
Unternehmensinformation / Kurzprofil:
Datum: 04.08.2015 - 23:17 Uhr
Sprache: Deutsch
News-ID 411546
Anzahl Zeichen: 65577
contact information:
Town:
Chicago
Kategorie:
Business News
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