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COEUR MINING INC
Symbol U : CDE
Recent Sedar Documents

Coeur Reports Fourth Quarter and Full-Year 2018 Results

2019-02-20 16:33 ET - News Release

Provides Full-Year 2019 Production and Cost Guidance


Company Website: http://www.coeur.com
CHICAGO -- (Business Wire)

Coeur Mining, Inc. (“Coeur” or the “Company”)(NYSE: CDE) today reported fourth quarter 2018 financial results, including revenue of $143.8 million, adjusted EBITDA1 of $36.2 million and cash flow from operating activities of $0.1 million ($24.5 million prior to changes in working capital). Including $24.5 million of non-cash write-downs, the Company reported GAAP net income from continuing operations of $0.4 million, or $0.00 per share. On an adjusted basis1, the Company reported net income of $16.1 million, or $0.08 per share.

Fourth quarter results reflect strong performance from Palmarejo, Rochester and Kensington, partially offset by the ongoing ramp-up of operations at the Company’s new Silvertip mine and weaker-than-expected performance at Wharf. Financial results also reflect the impact of the bankruptcy filing of Republic Metals Corp. (“RMC”), a U.S.-based precious metals refiner, that occurred in early November 2018. Non-cash write-downs during the quarter reflect (i) an inventory adjustment relating to concentrate at Silvertip and (ii) a reduction in accounts receivable relating to the RMC bankruptcy.

For the full year, Coeur reported revenue of $625.9 million, adjusted EBITDA1 of $157.3 million and cash flow from operating activities of $20.1 million ($112.4 million prior to changes in working capital). Including $55.3 million of non-cash write-downs, the Company reported a GAAP net loss from continuing operations of $49.0 million, or $0.26 per share. On an adjusted basis1, the Company reported a net loss of $2.2 million, or $0.01 per share. In addition to the non-cash write-downs in the fourth quarter noted above, the full-year figures also reflect (i) a modification to the deferred consideration received for the Company’s Bolivian subsidiary sold in early 2018, (ii) the decommissioning of the in-pit crusher at Rochester, and (iii) an inventory adjustment at Silvertip during its first month of commercial production.

Key Highlights

  • Strong performance at Palmarejo and Rochester - At Palmarejo, fourth quarter gold and silver production increased 12% and 23% quarter-over-quarter, respectively, while full-year gold and silver production increased 1% and 4%, respectively, compared to 2017. Palmarejo’s fourth quarter and full-year adjusted costs applicable to sales (“CAS”) per average spot silver equivalent ounce (“AgEqOz”)1 decreased 4% and 14%, respectively. At Rochester, fourth quarter silver and gold production increased 14% and 8%, respectively, compared to the third quarter, while full-year silver and gold production both increased 7% compared to 2017. Rochester’s fourth quarter and full-year adjusted CAS per AgEqOz1 decreased 5% and 4%, respectively
  • Increased production from Jualin resulted in strong fourth quarter results at Kensington - Nearly 10,500 ounces of gold were mined from the high-grade Jualin deposit during the fourth quarter, leading to a 24% increase in the average gold grade, a 32% increase in production (inclusive of pre-commercial), and a 23% reduction in CAS per AuOz1 quarter-over-quarter
  • Completed acquisition to further enhance portfolio quality and future pipeline - On November 19, 2018, Coeur completed the acquisition of an extensive land package adjacent to its Rochester operation in northern Nevada for $19 million from Alio Gold Inc. The acquisition included the Lincoln Hill Project, which is located approximately four miles west of Rochester and contains estimated gold grades nearly four-times higher than Rochester’s gold reserves.2 In total, the acquisition more than doubles Rochester’s land position from roughly 16,300 acres (approximately 6,600 hectares) to over 40,300 acres (approximately 16,300 hectares)
  • Continued ramp-up at Silvertip - Operations at Silvertip continued to ramp up during the fourth quarter and into 2019. Despite tracking behind original expectations, the Company continues to target a 1,100 ton per day (“tpd”) (1,000 metric tonne per day ("mtpd")) processing rate by the end of the first quarter. Throughput rates continue to improve, with January representing the best month of operating performance since the ramp-up of the mine and mill began last year. Coeur anticipates receiving 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
  • Weaker-than-expected fourth quarter at Wharf - Fourth quarter results were impacted by the placement of lower grade ore during the quarter and by temporary percolation leach pad issues that resulted in slower-than-anticipated recoveries in the quarter. Full-year results were also impacted by unplanned weather-related downtime experienced in the third quarter and timing of leach pad recoveries. Year-to-date 2019 performance at Wharf has rebounded and the Company expects full-year production to return to levels comparable to prior years
  • Fourth consecutive year of reserve growth2 as exploration programs continue to deliver solid results - Coeur’s full-year exploration investment totaled $44.0 million, comprised of $25.4 million of expensed exploration and $18.6 million of capitalized exploration. The Company drilled over 690,000 feet (210,300 meters) in 2018, its highest annual total since 2012. Proven and probable reserves from continuing operations totaled 2.8 million ounces of gold, 171.3 million ounces of silver, 291.2 million pounds of zinc and 197.5 million pounds of lead, an overall reserve increase year-over-year.2 The strong reserve growth was driven by the Company’s continued investment in its success-based exploration program

“The Company remains committed to its strategy of being a balanced gold and silver producer with a focus on generating sustainable, high-quality growth and cash flow from a North American asset base,” said Mitchell J. Krebs, Coeur’s President and Chief Executive Officer. “During 2018, we significantly decreased our geopolitical risk profile and further positioned the Company for future growth. We completed two strategic acquisitions of Nevada-based gold and silver assets last year and finalized the sale of the higher-cost San Bartolomé silver operation in Bolivia. In addition, we commenced operations at our new Silvertip operation in British Columbia, which is expected to become a significant contributor of high-margin, long-life production and cash flow for the Company. While Silvertip’s ramp-up has been slower than initially planned, we are steadily increasing mining and processing rates and remain enthusiastic about its future.

“Two other notable accomplishments last year were our drilling success and our cost performance. We successfully increased overall reserves for the fourth consecutive year while bolstering our growth pipeline through our high-return brownfield drilling investments,” continued Mr. Krebs. “Regarding cost performance, Palmarejo, Rochester and Wharf all beat their full-year unit cost guidance. Kensington achieved adjusted CAS per AuOz1 of $842 during the fourth quarter, 23% lower than the third quarter, largely due to the contribution of high-grade ounces from the Jualin deposit. Companywide capital expenditures and general and administrative expenses were in line with full-year guidance.”

 

Financial and Operating Highlights (Unaudited)

               

(Amounts in millions, except per share amounts, gold ounces
produced & sold, and per-ounce/pound metrics)

2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Revenue$625.9 $ 143.8 $ 148.8 $ 170.0 $ 163.3 $ 709.6 $ 214.6
Costs Applicable to Sales$441.0 $ 116.6 $ 116.9 $ 108.2 $ 99.3 $ 440.3 $ 122.0
General and Administrative Expenses$31.3 $ 7.1 $ 7.7 $ 7.7 $ 8.8 $ 33.6 $ 9.2
Net Income (Loss)$(49.0) $ 0.4 $ (53.0 ) $ 2.9 $ 0.7 $ 10.9 $ 14.3
Net Income (Loss) Per Share$(0.26) $ 0.00 $ (0.29 ) $ 0.02 $ 0.00 $ 0.06 $ 0.08
Adjusted Net Income (Loss)1$(2.2) $ 16.1 $ (19.7 ) $ 1.1 $ 0.3 $ 4.2 $ 14.1
Adjusted Net Income (Loss)1 Per Share$(0.01) $ 0.08 $ (0.11 ) $ 0.01 $ 0.00 $ 0.02 $ 0.08
Weighted Average Shares Outstanding188.6 199.5 185.2 187.5 187.6 184.1 187.0
EBITDA1$87.1 $ 7.9 $ (12.3 ) $ 42.1 $ 49.4 $ 202.9 $ 69.6
Adjusted EBITDA1$157.3 $ 36.2 $ 24.7 $ 48.4 $ 49.2 $ 203.3 $ 77.0
Cash Flow from Operating Activities$20.1 $ 0.1 $ 5.8 $ (1.3 ) $ 15.5 $ 197.2 $ 91.8
Capital Expenditures$140.8 $ 17.8 $ 39.5 $ 41.2 $ 42.3 $ 136.7 $ 47.1
Free Cash Flow1$(120.7) $ (17.7 ) $ (33.7 ) $ (42.5 ) $ (26.8 ) $ 60.4 $ 44.8
Cash, Equivalents & Short-Term Investments$115.1 $ 115.1 $ 104.7 $ 123.5 $ 159.6 $ 192.0 $ 192.0
Total Debt2$458.8 $ 458.8 $ 429.2 $ 419.7 $ 414.0 $ 411.3 $ 411.3
Average Realized Price Per Ounce – Silver$15.65 $ 14.59 $ 14.68 $ 16.48 $ 16.70 $ 16.96 $ 16.57
Average Realized Price Per Ounce – Gold$1,218 $ 1,214 $ 1,150 $ 1,241 $ 1,268 $ 1,204 $ 1,224
Average Realized Price Per Pound – Zinc$1.12 $ 1.07 $ 0.94 $ $ $
Average Realized Price Per Pound – Lead$0.90 $ 0.87 $ 0.85 $ $ $
Silver Ounces Produced12.8 3.5 2.9 3.2 3.2 12.1 3.7
Gold Ounces Produced359,520 92,546 87,539 94,052 85,383 383,086 118,756
Zinc Pounds Produced4.2 3.1 1.1
Lead Pounds Produced2.1 1.7 0.4
Silver Equivalent Ounces Produced134.7 9.4 8.2 8.8 8.3 35.1 10.8
Silver Equivalent Ounces Produced (Average Spot)142.3 11.2 10.1 10.6 9.9 40.4 12.8
Silver Ounces Sold12.4 3.1 2.9 3.2 3.2 12.7 3.8
Gold Ounces Sold350,508 79,291 89,609 94,455 87,153 410,604 123,564
Zinc Pounds Sold4.4 2.6 1.8
Lead Pounds Sold2.6 1.4 1.2
Silver Equivalent Ounces Sold133.8 8.0 8.5 8.9 8.4 37.3 11.1
Silver Equivalent Ounces Sold (Average Spot)141.2 10.1 10.4 10.7 10.1 43.0 13.2
Adjusted CAS per AgEqOz1$10.23 $ 11.06 $ 10.77 $ 9.44 $ 9.69 $ 10.62 $ 9.43
Adjusted CAS per Average Spot AgEqOz1$8.83 $ 9.35 $ 9.22 $ 8.26 $ 8.48 $ 9.59 $ 8.35
Adjusted CAS per AuEqOz1$978 $ 880 $ 1,005 $ 1,028 $ 955 $ 822 $ 800
Adjusted AISC per AgEqOz1$17.74 $ 18.33 $ 17.70 $ 17.62 $ 17.20 $ 15.90 $ 14.45
Adjusted AISC per Average Spot AgEqOz1$14.55   $ 14.64 $ 14.45 $ 14.65 $ 14.33 $ 13.82 $ 12.26
 

Financial Results

Fourth quarter revenue of $143.8 million was slightly lower compared to the prior quarter. Average realized gold and silver prices for the quarter were $1,214 and $14.59 per ounce, respectively, or 6% higher and 1% lower quarter-over-quarter.

For the full year, the Company generated revenue of $625.9 million compared to $709.6 million in 2017. Average realized gold and silver prices were $1,218 and $15.65, respectively, which were 1% higher and 8% lower year-over-year.

Average realized gold prices during the fourth quarter and for the full year reflect the sale of 5,458 and 35,807 gold ounces, respectively, at a price of $800 per ounce pursuant to Palmarejo’s gold stream agreement. The Company’s U.S. operations accounted for approximately 59% of 2018 revenue, unchanged from the prior year. Gold sales contributed 68% of 2018 revenue and silver sales contributed 31%.

Fourth quarter and full-year revenue also reflect the impact of the bankruptcy filing of RMC, which occurred in early November 2018. Approximately 6,500 ounces and 0.4 million ounces of the Company’s gold and silver, respectively, were affected by RMC’s Chapter 11 filing. As a result, Coeur was unable to recognize the revenue or collect the corresponding cash proceeds associated with that material. The Company recognized a $6.5 million write-down on its income statement to establish a receivable related to amounts owed from RMC, which resulted in an unfavorable change in working capital in the quarter. The amount of the write-down was determined in accordance with U.S. GAAP and may not be indicative of the actual amount that will be ultimately recovered from RMC.

Costs applicable to sales were $116.6 million and $441.0 million for the fourth quarter and full year, respectively, relatively flat compared to the same periods in the prior year. Lower overall costs applicable to sales were offset by inventory adjustments relating to concentrate at Silvertip, which totaled $18.0 million and $26.7 million for the fourth quarter and full year, respectively.

General and administrative expenses were $7.1 million and $31.3 million for the fourth quarter and full year, respectively, or 8% and 7% lower quarter-over-quarter and year-over-year. These decreases were largely driven by lower employee-related expenses. Exploration expense for the fourth quarter and full year was $4.1 million and $25.4 million, respectively. The Company focused its resource expansion efforts on its highest, near-mine growth targets at Palmarejo, Kensington and Silvertip. See page 11 for further details.

During the fourth quarter, the Company recorded an income tax benefit of $36.2 million, largely due to the release of a valuation allowance on its U.S. deferred tax assets in accordance with U.S. GAAP. For the full year, the Company recorded an income tax benefit of $16.8 million.

Operating cash flow of $0.1 million and $20.1 million for the fourth quarter and full year, respectively, was impacted by changes in working capital. Excluding changes in working capital, fourth quarter and full-year operating cash flow were $24.5 million and $112.4 million, respectively. Fourth quarter working capital was largely driven by unfavorable movements in inventory, primarily from Silvertip and material that was impacted by RMC’s bankruptcy. Full-year working capital was also impacted by accounts receivable, largely related to the timing of Mexican value-added tax refunds, as well as income and mining tax payments at Palmarejo associated with 2017 earnings.

Fourth quarter capital expenditures of $17.8 million decreased 55% quarter-over-quarter primarily due to the declaration of commercial production at Silvertip. Full-year capital expenditures of $140.8 million were relatively flat year-over-year. Sustaining and development capital expenditures accounted for approximately 60% and 40%, respectively, of the Company’s capital expenditures in 2018.

Operations

Fourth quarter and full-year 2018 highlights for each of the Company’s operations are provided below.

               

Palmarejo, Mexico

 
(Dollars in millions, except per ounce amounts)2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Tons milled1,382,471 378,389 300,116 344,073 359,893 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 – Ag83.8% 84.0% 82.2% 87.5% 81.4% 86.0% 87.0%
Average recovery rate – Au88.9% 97.6% 88.8% 89.9% 80.4% 90.0% 92.0%
Silver ounces produced (000’s)7,516 1,893 1,544 2,066 2,013 7,242 2,346
Gold ounces produced122,722 31,239 27,885 33,702 29,896 121,569 37,537
Silver equivalent ounces produced1 (000’s)14,880 3,768 3,217 4,088 3,807 14,536 4,600
Silver equivalent ounces produced1 (average spot) (000’s)17,429 4,528 3,796 4,728 4,382 16,207 5,209
Silver ounces sold (000’s)7,229 1,534 1,572 2,092 2,031 7,586 2,343
Gold ounces sold115,592 23,667 29,830 31,207 30,888 131,743 38,953
Silver equivalent ounces sold1 (000’s)14,165 2,955 3,362 3,964 3,884 15,491 4,681
Silver equivalent ounces sold1 (average spot) (000’s)16,566 3,530 3,981 4,557 4,479 17,301 5,331
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
Metal sales$245.8 $49.6 $55.5 $70.7 $70.0 $274.8 $83.2
Costs applicable to sales$120.1 $27.1 $31.6 $30.3 $31.1 $146.2 $36.0
Adjusted CASper AgEqOz1$8.46 $9.11 $9.39 $7.64 $8.01 $9.36 $7.54
Adjusted CAS per average spot AgEqOz1$7.23 $7.62 $7.93 $6.64 $6.94 $8.38 $6.64
Exploration expense$10.5 $0.1 $3.2 $3.2 $4.0 $11.9 $2.7
Cash flow from operating activities$50.5 $13.3 $8.6 $1.3 $27.3 $139.9 $52.1
Sustaining capital expenditures (excludes capital lease payments)$24.4 $3.6 $2.0 $9.5 $9.3 $22.5 $4.9
Development capital expenditures$5.0   $2.3   $2.7   $—   $—   $7.4   $2.1
Total capital expenditures$29.4 $5.9 $4.7 $9.5 $9.3 $29.9 $7.0
Free cash flow1$21.1 $7.4 $3.9 $(8.2) $18.0 $110.0 $45.1
  • Fourth quarter gold and silver production increased 12% and 23%, respectively, to 31,239 and 1.9 million ounces compared to the prior quarter. Full-year gold and silver production increased 1% and 4%, respectively, to 122,722 ounces and 7.5 million ounces
  • 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
  • Fourth quarter adjusted CAS per average spot AgEqOz1 decreased 4% to $7.62 compared to the prior quarter and full-year adjusted CAS per average spot AgEqOz1 decreased 14% year-over-year to $7.23. The quarterly decrease was largely due to higher throughput, partially offset by lower grades. The year-over-year decline was primarily due to higher gold and silver grades
  • 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 additional mill feed to supplement existing ore sources
  • Palmarejo generated free cash flow1 of $21.1 million for the full year. The decrease compared to the prior year was primarily driven by $39.6 million of cash income and mining taxes paid in 2018, $17.0 million of which was associated with 2017 earnings
  • Full-year 2019 production is expected to be 95,000 - 105,000 ounces of gold and 6.5 - 7.2 million ounces of silver. Comparatively lower gold production is largely attributable to an expected reduction in overall gold grade
  • CAS are expected to be $650 - $750 per gold ounce and $9.00 - $10.00 per silver ounce
  • Capital expenditures are expected to be approximately $40 - $45 million
               

Rochester, Nevada

 
(Dollars in millions, except per ounce amounts)2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Ore tons placed16,169,807 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
Silver ounces produced (000’s)5,038 1,466 1,290 1,125 1,157 4,714 1,361
Gold ounces produced54,388 15,926 14,702 12,273 11,487 51,051 18,995
Silver equivalent ounces produced1 (000’s)8,301 2,422 2,172 1,861 1,846 7,777 2,500
Silver equivalent ounces produced1 (average spot) (000’s)9,431 2,809 2,477 2,095 2,067 8,478 2,808
Silver ounces sold (000’s)4,855 1,391 1,248 1,097 1,119 4,931 1,457
Gold ounces sold52,789 15,339 14,257 12,030 11,163 54,642 20,002
Silver equivalent ounces sold1 (000’s)8,022 2,310 2,104 1,819 1,789 8,210 2,658
Silver equivalent ounces sold1 (average spot) (000’s)9,118 2,683 2,400 2,048 2,004 8,961 2,969
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
Metal sales$141.8 $39.1 $35.5 $33.7 $33.5 $152.7 $49.7
Costs applicable to sales$105.7 $29.4 $27.5 $24.5 $24.3 $107.9 $34.0
Adjusted CASper AgEqOz1$13.04 $12.57 $13.04 $13.36 $13.33 $13.08 $12.77
Adjusted CAS per average spot AgEqOz1$11.47 $10.83 $11.42 $11.87 $11.89 $11.97 $11.37
Exploration expense$0.3 $0.1 $0.2 $— $1.4 $0.5
Cash flow from operating activities$33.0 $17.9 $5.7 $6.0 $3.4 $32.3 $26.1
Sustaining capital expenditures (excludes capital lease payments)$10.7 $7.1 $2.7 $0.4 $0.5 $2.7 $0.9
Development capital expenditures$(0.8)   $(4.1)   $0.9   $0.3   $2.1   $38.2   $5.9
Total capital expenditures$9.9 $3.0 $3.6 $0.7 $2.6 $40.9 $6.8
Free cash flow1$23.1 $14.9 $2.1 $5.3 $0.8 $(8.6) $19.3
  • 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. For the full year, silver production was 5.0 million ounces while gold production was 54,388 ounces, both 7% higher than 2017
  • 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 tpd in-pit crusher
  • Fourth quarter adjusted CAS per average spot AgEqOz1 of $10.83 were 5% lower compared to the prior quarter due to strong production results in combination with lower leaching and processing costs. Full-year CAS per average spot AgEqOz1 of $11.47 were 4% lower than in 2017
  • The concrete foundation for the initial high-pressure grinding roll (“HPGR”) unit and its structural erection were completed in late January 2019. Ore production utilizing the HPGR unit is anticipated to commence in the second quarter, with silver recoveries expected to increase beginning mid-year
  • Free cash flow1 for the fourth quarter increased to $14.9 million from $2.1 million the prior quarter due to improved production and lower capital expenditures. Full-year free cash flow1 of $23.1 million improved substantially from 2017, largely reflecting the first full year of ore placement at the expanded Stage IV leach pad
  • Full-year 2019 production is expected to be 4.2 - 5.0 million ounces of silver and 40,000 - 50,000 ounces of gold. Given the timing of the installation of the initial HPGR unit and a new secondary crusher, production is expected to be higher during the second half of the year
  • CAS in 2019 are expected to be $12.50 - $13.50 per silver ounce and $1,000 - $1,100 per gold ounce
  • Capital expenditures are expected to be approximately $17 - $20 million, including approximately $12 - $15 million associated with the initial HPGR unit
               

Kensington, Alaska

 
(Dollars in millions, except per ounce amounts)2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Tons milled641,058 149,998 163,603 168,751 158,706 668,727 167,631
Average gold grade (oz/t)0.18 0.21 0.17 0.16 0.17 0.18 0.22
Average recovery rate92.3% 91.1% 90.4% 92.6% 94.0% 93.5% 92.8%
Gold ounces produced105,570 28,421 25,515 25,570 26,064 115,094 34,932
Gold ounces sold106,555 24,987 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
Metal sales$132.9 $31.1 $29.8 $35.7 $36.3 $154.5 $44.3
Costs applicable to sales$112.4 $21.4 $28.2 $34.2 $28.6 $116.1 $32.0
Adjusted CAS per AuOz1$1,050 $842 $1,091 $1,195 $1,010 $920 $896
Exploration expense$5.9 $1.3 $1.6 $1.4 $1.6 $8.6 $2.8
Cash flow from operating activities$15.3 $7.9 $(0.4) $3.2 $4.6 $37.6 $16.8
Sustaining capital expenditures (excludes capital lease payments)$37.2 $9.8 $9.7 $9.2 $8.5 $20.7 $8.0
Development capital expenditures$7.5   $0.8   $2.3   $1.5   $2.9   $15.5   $4.0
Total capital expenditures$44.7 $10.6 $12.0 $10.7 $11.4 $36.2 $12.0
Free cash flow1$(29.4) $(2.7) $(12.4) $(7.5) $(6.8) $1.4 $4.8
  • Commercial production at Jualin was declared on December 1, 2018. The figures shown in the table above exclude pre-commercial production. Including pre-commercial production, full-year gold production totaled 113,778 ounces in 2018 and was relatively flat year-over-year
  • Including 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
  • Average gold grade increased approximately 24% in the fourth quarter to 0.21 ounces per ton (“oz/t”), compared to 0.17 oz/t in the prior quarter, driven primarily by production from Jualin. Average gold grade of 0.18 oz/t for 2018 was flat year-over-year
  • 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 oz/t.
  • Adjusted CAS during the fourth quarter declined 23% to $842 per AuOz1, driven primarily by the high-grade production at Jualin. Full-year adjusted CAS per AuOz1 of $1,050, 14% higher compared to 2017, reflected lower recoveries and fewer ounces sold
  • Negative free cash flow1 of $29.4 million for the year was impacted by increased capital expenditures driven by higher underground development expenditures at Kensington, Jualin and Raven as well as higher mining equipment expenditures
  • Production in 2019 is expected to be 117,000 - 130,000 ounces of gold
  • CAS in 2019 are expected to be $950 - $1,050 per ounce
  • Capital expenditures are expected to be $20 - $25 million in 2019
               

Wharf, South Dakota

 
(Dollars in millions, except per ounce amounts)2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Ore tons placed4,923,774 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
Gold ounces produced76,840 16,960 19,437 22,507 17,936 95,372 27,292
Silver ounces produced (000’s)51 13 13 13 12 64 16
Gold equivalent ounces produced177,683 17,175 19,646 22,729 18,133 96,431 27,560
Gold ounces sold75,572 15,306 19,874 23,053 17,339 98,237 28,975
Silver ounces sold (000’s)48 11 12 14 11 74 16
Gold equivalent ounces sold176,373 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
Metal sales$96.5 $19.3 $24.0 $29.8 $23.4 $125.9 $37.3
Costs applicable to sales$67.2 $14.6 $18.0 $19.3 $15.3 $69.3 $19.9
Adjusted CAS per AuEqOz1$876 $938 $895 $824 $870 $700 $682
Exploration expense$0.1 $0.1 $— $— $0.3 $0.1
Cash flow from operating activities$11.9 $(1.9) $3.7 $11.5 $(1.4) $49.6 $17.2
Sustaining capital expenditures (excludes capital lease payments)$3.4 $0.7 $1.2 $1.2 $0.3 $5.8 $1.6
Development capital expenditures$—   $—   $—   $—   $—   $3.0   $1.7
Total capital expenditures$3.4 0.7 $1.2 $1.2 $0.3 $8.8 $3.3
Free cash flow1$8.5 $(2.6) $2.5 $10.3 $(1.7) $40.8 $13.9
  • Gold production decreased 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, up from 4.6 million in 2017 and 4.3 million in 2016
  • Fourth quarter and full-year adjusted CAS per AuEqOz1 increased 5% and 25%, respectively, to $938 and $876, compared to the prior quarter and 2017, primarily due to lower production levels as well as higher crushing and diesel costs
  • Free cash flow1 of $8.5 million for the full year was lower than 2017 due to a decline in production resulting from lower average grades and the timing of leach pad recoveries. Since acquiring the operation in February 2015 for $99 million, Wharf has generated $135.7 million of free cash flow1
  • Production in 2019 is anticipated to be more in line with historical periods, with gold production expected to be 82,000 - 87,000 ounces. CAS are expected to be $850 - $950 per ounce
  • Capital expenditures are expected to be approximately $3 - $5 million in 2019
               

Silvertip, British Columbia

 
(Dollars in millions, except per ounce and per pound amounts)2018   4Q 2018   3Q 2018   2Q 2018   1Q 2018   2017   4Q 2017
Tons milled49,454 38,802 10,652
Average silver grade (oz/t)6.19 6.06 6.66
Average zinc grade (%)6.2% 5.8% 8.0% —% —% —% —%
Average lead grade (%)4.0% 3.9% 4.3% —% —% —% —%
Average recovery rate – Ag59.6% 60.5% 56.3% —% —% —% —%
Average recovery rate – Zn67.8% 69.1% 64.5% —% —% —% —%
Average recovery rate – Pb52.5% 54.7% 45.1% —% —% —% —%
Silver ounces produced (000's)182 142 40
Zinc pounds produced (000's)4,181 3,082 1,099
Lead pounds produced (000's)2,072 1,659 413
Silver equivalent ounces produced1 (000's)537 410 127
Silver equivalent ounces produced1 (average spot) (000's)641 488 153
Silver ounces sold (000's)223 124 99
Zinc pounds sold (000's)4,376 2,604 1,772
Lead pounds sold (000's)2,649 1,419 1,230
Silver equivalent ounces sold1 (000's)618 351 267
Silver equivalent ounces sold1 (average spot) (000's)732 418 267
Average realized price per silver ounce$15.00 $15.54 $13.46 $— $— $— $—
Average realized price per zinc pound$1.12 $1.07 $0.94 $— $— $— $—
Average realized price per lead pound$0.90 $0.87 $0.85 $— $— $— $—
Metal sales$8.9 $4.8 $4.1 $— $— $— $—
Costs applicable to sales$35.6 $24.1 $11.5 $— $— $— $—
Adjusted CASper AgEqOz1$14.40 $17.40 $10.46 $— $— $— $—
Adjusted CAS per average spot AgEqOz1$12.16 $14.39 $8.69 $— $— $— $—
Exploration expense$2.7 $0.3 $2.3 $0.1 $— $— $—
Cash flow from operating activities$(40.9) $(34.1) $(6.8) $— $— $— $—
Sustaining capital expenditures (excludes capital lease payments)$8.6 $8.2 $0.4 $— $— $— $—
Development capital expenditures$44.3   $(10.8)   $17.5   $19.0   $18.6   $—   $—
Total capital expenditures$52.9 $(2.6) $17.9 $19.0 $18.6 $— $—
Free cash flow1$(93.8) $(31.5) $(24.7) $(19.0) $(18.6) $— $—
  • Silvertip achieved commercial production on September 1, 2018. The operating and financial metrics shown in the table above exclude pre-commercial production
  • On December 27, 2018, Coeur announced an initial reserve estimate and updated resource estimate. The Company filed a technical report in accordance with Canadian National Instrument 43-101 on February 8, 2019
  • Including pre-commercial production, 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 slower to ramp up due to mill maintenance projects, the Company continues progressing towards its target of a 1,100 tpd (1,000 mtpd) processing rate by the end of the first quarter
  • 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
  • Recovery rates continued to improve throughout the fourth quarter and 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 replaced with newly-mined underground material
  • Capital expenditures in the fourth quarter were largely impacted by the first full quarter of commercial production and by a sale-leaseback of the newly-constructed 220-person camp facility
  • Permitting efforts remain on track to receive approval for the permit amendment application allowing for a year-round mining and milling rate of 1,100 tpd (1,000 mtpd) in early 2019
  • 2019 production is expected to total 1.5 - 2.5 million ounces of silver, 25 - 40 million pounds of zinc and 20 - 35 million pounds of lead
  • CAS are expected to be $14.00 - $16.00 per ounce of silver, $1.00 - $1.25 per pound of zinc and $0.85 - $1.05 per pound of lead
  • 2019 capital expenditures are expected to total $20 - $25 million

Exploration

During the fourth quarter, Coeur’s exploration activities transitioned from completing key drill programs to updating and refining its geologic models as well as developing strategic priorities for 2019. Expensed resource expansion drilling declined 50% quarter-over-quarter to $4.1 million, while capitalized resource infill drilling declined 35% to $1.5 million. Up to ten drill rigs were active during the quarter, with drilling activity present at Palmarejo, Kensington and Rochester as well as at early-stage projects near Tonopah, Nevada, in northern Chihuahua, Mexico and at the Company’s recently acquired Sterling Gold Project.

At Palmarejo, two drill rigs were active at the end of the year, down from a high of seven during the first quarter. During the first half of the year, resource expansion drilling targeted the La Nación deposit and demonstrated the presence of several zones of thick mineralization (“clavos”). Resource expansion drilling also targeted veins west of Guadalupe and north of Independencia. Infill drilling continued at the Guadalupe and Independencia veins, with results within the Las Animas zone at Guadalupe being a highlight near year-end. Over 244,000 feet (74,500 meters) were drilled at Palmarejo during the year, representing the Company’s largest exploration investment. For 2019, priorities at Palmarejo will shift to resource discovery of new high-grade clavos as well as continued infill on Guadalupe, Independencia and Nación veins.

At Kensington, the Company prioritized resource expansion drilling during 2018. Discovery and expansion drilling focused on the Elmira, Seward and Ophir veins, with a district-wide focus on discovery of high-grade veins similar to Jualin located near existing infrastructure. Infill drilling during the year targeted the Upper Kensington Zone 30 and Raven veins. In the beginning of 2019, the Company expects to initially focus on infill drilling then shift to testing new targets at several areas that were sampled in 2018. Over the course of the year, infill drilling is expected to continue at Kensington Main, Raven and Elmira.

At Rochester, infill drilling slowed during the fourth quarter but remained focused on the main Rochester Pit and surrounding areas, including Northeast Pit and South Charlie. Additionally, exploration efforts were directed at engineering and condemnation drilling for the Plan of Operations Amendment 11 expansion area. In 2019, resource infill drilling will continue and basic target generation work is expected to be completed at the recently acquired Lincoln Hill Project.

At the Sterling Gold Project, acquired in October 2018, two reverse circulation rigs were focused on infill drilling at the Sterling Mine area. Coeur drilled a total of 41 holes during the fourth quarter. Including drilling activity by Northern Empire prior to its acquisition by the Company, a total of 99,291 feet (30,272 meters) were drilled in 2018 with roughly one-third focused on the Sterling Mine and the remaining two-thirds focused on the Crown Block. The Company will prioritize resource expansion in 2019, focused on shallow, low-strip, oxide gold mineralization, initially at the Sterling Mine and shifting to the Crown Block during the second quarter, where drilling is expected to continue for the remainder of the year.

2019 Guidance Framework

Following a comprehensive review of the Company’s historical guidance framework, Coeur is modifying its production and cost guidance framework for 2019. Key changes include:

  • Elimination of silver equivalence - Production and unit cost guidance will focus on site-level figures by metal rather than silver equivalent units
  • Change in unit cost methodology - Site-level unit cost figures will be presented on a co-product basis, with the exception of Wharf, which will be presented on a by-product basis
  • Elimination of all-in-sustaining costs (“AISC”) - The Company will no longer provide guidance or financial reporting on AISC
  • Price and foreign exchange assumptions - The Company will note key price and foreign exchange assumptions underpinning guidance ranges

Coeur plans to discontinue its reporting of silver equivalent metrics and begin providing cost metrics on a co-product basis (or by-product, in the case of Wharf) in conjunction with its first quarter 2019 financial results. The fourth quarter and full-year 2018 earnings presentation will include historical reconciliations for unit cost metrics for the four quarterly and full-year 2018 periods.

2019 Production Guidance

    Gold     Silver     Zinc     Lead
      (oz)     (K oz)     (K lbs)     (K lbs)
Palmarejo 95,000 - 105,000 6,500 - 7,200
Rochester 40,000 - 50,000 4,200 - 5,000
Kensington 117,000 - 130,000
Wharf 82,000 - 87,000
Silvertip         1,500 - 2,500     25,000 - 40,000     20,000 - 35,000
Total     334,000 - 372,000     12,200 - 14,700     25,000 - 40,000     20,000 - 35,000
 

2019 Costs Applicable to Sales Guidance

    Gold     Silver     Zinc     Lead
      ($/oz)     ($/oz)     ($/lb)     ($/lb)
Palmarejo (co-product) $650 - $750 $9.00 - $10.00
Rochester (co-product) $1,000 - $1,100 $12.50 - $13.50
Kensington $950 - $1,050
Wharf (by-product) $850 - $950
Silvertip (co-product) $14.00 - $16.00 $1.00 - $1.25 $0.85 - $1.05
 

2019 Capital, Exploration and G&A Guidance

          ($M)
Capital Expenditures, Sustaining         $70 - $80
Capital Expenditures, Development $30 - $40
Exploration, Expensed $18 - $22
Exploration, Capitalized $8 - $12
General & Administrative Expenses $32 - $36

Note: The Company’s guidance figures assume $1,275/oz. gold, $15.50/oz. silver, $1.15/lb. zinc and $0.95/lb. lead as well as CAD of 1.30 and MXN of 20.00.

Financial Results and Conference Call

Coeur will host a conference call to discuss its fourth quarter and full-year 2018 financial results 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 Statements

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, capital expenditures, milling and mining rates, recovery rates, exploration expenditures, expenses, cash flow, expectations regarding Silvertip, including but not limited to timing of receipt of permits, grades, exploration and development efforts, the timing and impact of installation of HPGR units at Rochester, and operations at Palmarejo, Rochester, Wharf, Kensington and 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 risk that anticipated benefits of acquisitions are not realized, the risk that expectations regarding the timing of Silvertip obtaining necessary permits, the risk that HPGR units will not be installed at Rochester on a timely basis or the anticipated benefits thereof will not be achieved, the risk that anticipated production, cost and expense 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, 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 (including the impact of government shutdowns), ground conditions, grade variability, any future labor disputes or work stoppages, the uncertainties inherent in the estimation of mineral reserves, changes that could result from Coeur’s future acquisition of new mining properties or businesses, the loss of any third-party smelter to which Coeur markets its production, 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 report on Form 10-K. 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 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 EBITDA, adjusted EBITDA, adjusted EBITDA margin, free cash flow, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver ounce (or per gold 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 EBITDA, adjusted EBITDA, adjusted EBITDA margin, free cash flow, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver ounce (or per gold ounce), all-in sustaining costs, and adjusted all-in sustaining costs are important measures in assessing the Company’s overall financial performance. For additional explanation regarding our use of non-U.S. GAAP financial measures, please refer to our Form 10-K for the year ended December 31, 2017.

Notes

  1. EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver ounce (or per gold ounce), all-in sustaining costs, and adjusted all-in sustaining costs are non-GAAP measures. Please see tables in the Appendix for the reconciliation to U.S. GAAP. Free cash flow is defined as cash flow from operating activities less capital expenditures and gold production royalty payments. Please see table in Appendix for the calculation of consolidated free cash flow. 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. Unit cost guidance on a spot equivalent basis assumes silver-to-gold, -zinc and -lead equivalence ratios of 75:1, 0.09:1 and 0.07:1, respectively.
  2. Year-end 2018 reserves and resources as published by Coeur on February 20, 2019. Figures reflect reserves and resources from continuing operations and exclude the San Bartolomé mine, which Coeur divested on February 28, 2018, through the sale of its 100%-owned Bolivian subsidiary. San Bartolomé is excluded from consolidated operating statistics for all periods presented unless otherwise noted.
  3. Includes capital leases. Net of debt issuance costs and premium received.
  4. Full-year 2018 production results and 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 Equivalence81:1 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 Equivalence0.08:1 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 Equivalence0.06:1 0.06:1 0.06:1 0.07:1 0.07:1 0.06:1 0.07:1
 
   
COEUR MINING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
 
Year ended December 31,
2018   2017   2016
In thousands, except share data
Revenue $ 625,904 $ 709,598   $ 571,897
COSTS AND EXPENSES
Costs applicable to sales(1) 440,950 440,260 335,375
Amortization 128,473 146,549 116,528
General and administrative 31,345 33,616 29,275
Exploration 25,397 30,311 12,930
Pre-development, reclamation, and other 20,043   18,936     14,411  
Total costs and expenses 646,208 669,672 512,965
OTHER INCOME (EXPENSE), NET
Loss on debt extinguishment (9,342 ) (21,365 )
Fair value adjustments, net 3,638 (864 ) (11,581 )
Interest expense, net of capitalized interest (24,364 ) (16,440 ) (36,896 )
Other, net (24,705 ) 26,643     98  
Total other income (expense), net (45,431 ) (3 )   (69,744 )
Income (loss) before income and mining taxes (65,735 ) 39,923 (10,812 )
Income and mining tax (expense) benefit 16,780   (28,998 )   33,247  
Income (loss) from continuing operations $ (48,955 ) $ 10,925 $ 22,435
Income (loss) from discontinued operations 550   (12,244 )   32,917  
NET INCOME (LOSS) $ (48,405 ) $ (1,319 ) $ 55,352
OTHER COMPREHENSIVE INCOME (LOSS), net of tax:
Unrealized gain (loss) on debt and equity securities 26 3,227 3,222
Reclassification adjustments for impairment of equity securities 426 703
Reclassification adjustments for realized (gain) loss on sale of equity securities   1,354     (2,691 )
Other comprehensive income (loss) 26   5,007     1,234  
COMPREHENSIVE INCOME (LOSS) $ (48,379 ) $ 3,688     $ 56,586  
 
NET INCOME (LOSS) PER SHARE
Basic income (loss) per share:
Net income (loss) from continuing operations $ (0.26 ) $ 0.06 $ 0.14
Net income (loss) from discontinued operations 0.00   (0.07 ) 0.21  
Basic(2) $ (0.26 ) $ (0.01 )   $ 0.35  
Diluted income (loss) per share:
Net income (loss) from continuing operations $ (0.26 ) $ 0.06 $ 0.14
Net income (loss) from discontinued operations 0.00   (0.07 ) 0.20  
Diluted(2) $ (0.26 ) $ (0.01 )   $ 0.34  
 

(1) Excludes amortization.

(2) Due to rounding, the sum of net income per share from continuing operations and discontinued operations may not equal net income per share.

 
COEUR MINING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 
    Year ended December 31,
2018   2017   2016
In thousands
CASH FLOWS FROM OPERATING ACTIVITIES:  
Net income (loss) $ (48,405 ) $ (1,319 ) $ 55,352
(Income) loss from discontinued operations (550 ) 12,244 (32,917 )
Adjustments:
Amortization 128,473 146,549 116,528
Accretion 13,933 9,980 9,142
Deferred taxes (48,441 ) (13,888 ) (54,184 )
Loss on debt extinguishment 9,342 21,365
Fair value adjustments, net (3,638 ) 864 11,581
Stock-based compensation 8,328 10,541 9,715
Gain on sale of the Joaquin project (21,138 )
Write-downs 55,297 4,446
Other 7,353 (7,974 ) 356
Changes in operating assets and liabilities:
Receivables (9,260 ) 18,895 (2,783 )
Prepaid expenses and other current assets 4,876 (2,015 ) (4,420 )
Inventory and ore on leach pads (44,488 ) 23,517 (34,610 )
Accounts payable and accrued liabilities (43,370 ) 11,562   (3,110 )
CASH PROVIDED BY OPERATING ACTIVITIES OF CONTINUING OPERATIONS 20,108 197,160 96,461
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS (2,690 ) 11,296   29,356  
CASH PROVIDED BY OPERATING ACTIVITIES 17,418 208,456 125,817
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (140,787 ) (136,734 ) (94,382 )
Acquisitions, net 6,914 (156,248 ) (1,417 )
Proceeds from the sale of assets 577 16,705 16,296
Purchase of investments (426 ) (15,058 ) (178 )
Sale of investments 12,713 11,321 7,077
Proceeds from notes receivable 19,000
Other 11   2,864   1,756  
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES OF CONTINUING OPERATIONS (101,998 ) (277,150 ) (70,848 )
CASH USED IN INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS (28,470 ) (1,392 ) (6,631 )
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (130,468 ) (278,542 ) (77,479 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 269,556
Issuance of notes and bank borrowings, net of issuance costs 95,000 342,620
Payments on debt, capital leases, and associated costs (95,059 ) (203,045 ) (318,153 )
Gold production royalty payments (27,155 )
Other (5,160 ) (3,746 ) 172  
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES OF CONTINUING OPERATIONS (5,219 ) 135,829 (75,580 )
CASH USED IN FINANCING ACTIVITIES OF DISCONTINUED OPERATIONS (22 ) (84 ) (4,648 )
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES (5,241 ) 135,745   (80,228 )
Effect of exchange rate changes on cash and cash equivalents 28   203   (678 )
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH (118,263 ) 65,862 (32,568 )
Less net cash provided by (used in) discontinued operations(1) (32,930 ) (10,939 ) 1,576  
(85,333 ) 76,801   (34,144 )
Cash, cash equivalents and restricted cash at beginning of period 203,402   126,601   160,745  
Cash, cash equivalents and restricted cash at end of period $ 118,069   $ 203,402   $ 126,601  

(1) Less net cash provided by (used in) discontinued operations includes the following cash transactions: net subsidiary payments to parent company of $1,748, $20,759, and $16,501 during the years ended December 31, 2018, 2017, and 2016, respectively.

 
COEUR MINING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
 
    December 31, 2018   December 31, 2017
ASSETSIn thousands, except share data
CURRENT ASSETS
Cash and cash equivalents $ 115,081 $ 192,032
Receivables 29,744 19,069
Inventory 66,279 58,230
Ore on leach pads 75,122 73,752
Prepaid expenses and other 11,393 15,053
Assets held for sale   91,421  
297,619 449,557
NON-CURRENT ASSETS
Property, plant and equipment, net 298,451 254,737
Mining properties, net 971,567 829,569
Ore on leach pads 66,964 65,393
Restricted assets 12,133 20,847
Equity and debt securities 17,806 34,837
Receivables 31,151 28,750
Other 16,809   17,485  
TOTAL ASSETS $ 1,712,500   $ 1,701,175  
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable $ 47,210 $ 48,592
Accrued liabilities and other 82,619 94,930
Debt 24,937 30,753
Reclamation 6,552 3,777
Liabilities held for sale   50,677  
161,318 228,729
NON-CURRENT LIABILITIES
Debt 433,889 380,569
Reclamation 128,994 117,055
Deferred tax liabilities 79,070 105,148
Other long-term liabilities 56,717   54,697  
698,670 657,469
STOCKHOLDERS’ EQUITY
Common stock, par value $0.01 per share; authorized
300,000,000 shares, 203,310,443 issued and outstanding at
December 31, 2018 and 185,637,724 at December 31, 2017 2,033 1,856
Additional paid-in capital 3,443,082 3,357,345
Accumulated other comprehensive income (loss) (59 ) 2,519
Accumulated deficit (2,592,544 ) (2,546,743 )
852,512   814,977  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 1,712,500   $ 1,701,175  
 

Adjusted EBITDA Reconciliation

               
(Dollars in thousands except per share amounts)20184Q 20183Q 20182Q 20181Q 201820174Q 2017
Net income (loss) $ (48,405 ) $ 468 $ (53,044 ) $ 2,930 $ 1,241 $ (1,319 ) $ 7,625
(Income) loss from discontinued operations, net of tax (550 ) (550 ) 12,244 6,724
Interest expense, net of capitalized interest 24,364 6,563 5,818 6,018 5,965 16,440 5,522
Income tax provision (benefit) (16,780 ) (36,231 ) 3,785 3,717 11,949 28,998 4,957
Amortization 128,473   37,053   31,184   29,459   30,777   146,549   44,722  
EBITDA 87,102 7,853 (12,257 ) 42,124 49,382 202,912 69,550
Fair value adjustments, net (3,638 ) (731 ) (715 ) 2,462 (4,654 ) 864
Impairment of equity and debt securities 426
Foreign exchange (gain) loss 9,069 1,986 3,104 3,309 670 (1,281 ) 672
Gain on sale of Joaquin project (21,138 )
(Gain) loss on sale of assets and securities (19 ) 298 28 (586 ) 241 1 499
Gain on repurchase of Rochester royalty (2,332 )
Loss on debt extinguishment 9,342
Mexico inflation adjustment (1,939 ) (1,939 )
Transaction costs 5 (1,044 ) 1,049 3,757 2,938
Interest income on notes receivables (1,776 ) (327 ) (628 ) (573 ) (248 )
Manquiri sale consideration write-down 18,599 18,599
Silvertip start-up write-down 26,720 17,974 8,746
Rochester In-Pit crusher write-down 3,441 3,441
Receivable write-down 6,536 6,536
Asset retirement obligation accretion 11,116 2,747 2,883 2,817 2,669 8,983 2,475
Inventory adjustments and write-downs 2,093   858   421   817   1,126   1,806   885  
Adjusted EBITDA $ 157,309   $ 36,150   $ 24,671   $ 48,431   $ 49,186   $ 203,340     $ 77,019  
Revenue $ 625,904 143,855 $ 148,795 $ 169,987 $ 163,267 $ 709,598 $ 214,585
Adjusted EBITDA Margin 25 % 25 % 17 % 28 % 30 % 29 % 36 %
 

Adjusted Net Income (Loss) Reconciliation

               
(Dollars in thousands except per share amounts)20184Q 20183Q 20182Q 20181Q 201820174Q 2017
Net income (loss) $ (48,405 ) $ 468 $ (53,044 ) $ 2,930 $ 1,241 $ (1,319 ) $ 7,625
(Income) loss from discontinued operations, net of tax (550 ) (550 ) 12,244 6,724
Fair value adjustments, net (3,638 ) (731 ) (715 ) 2,462 (4,654 ) 864
Impairment of equity and debt securities 426
Write-downs
Inventory write-downs
Gain on sale of Joaquin project (21,138 )
(Gain) loss on sale of assets and securities (19 ) 326 (586 ) 241 1 499
Gain on repurchase of Rochester royalty (28 ) 28 (2,332 )
(Gain) loss on debt extinguishment 9,342
Mexico inflation adjustment (1,939 ) (1,939 )
Transaction costs 5 (1,044 ) 1,049 3,757 2,938
Deferred tax on reorganization
Interest income on notes receivables (1,776 ) (327 ) (628 ) (573 ) (248 )
Manquiri sale consideration write-down 18,599 18,599
Silvertip start-up write-down 26,720 17,974 8,746
Rochester In-Pit crusher write-down 3,441 3,441
Receivable write-down 6,536 6,536
Foreign exchange loss (gain) 8,611 (530 ) 6,062 (1,233 ) 4,312 1,562 (3,643 )
Tax effect of adjustments(1) (9,750 ) (6,559 ) (3,191 )     816    
Adjusted net income (loss) $ (2,165 ) $ 16,085   $ (19,653 ) $ 1,061   $ 342   $ 4,223   $ 14,143  
 
Adjusted net income (loss) per share - Basic $ (0.01 ) $ 0.08 $ (0.11 ) $ 0.01 $ 0.00 $ 0.02 $ 0.08
Adjusted net income (loss) per share - Diluted $ (0.01 ) $ 0.08 $ (0.11 ) $ 0.01 $ 0.00 $ 0.02 $ 0.08
 

Consolidated Free Cash Flow Reconciliation

               
(Dollars in thousands)20184Q 20183Q 20182Q 20181Q 201820174Q 2017
Cash flow from continuing operations $ 20,108 $ 72 $ 5,789 $ (1,294 ) $ 15,541 $ 197,160 $ 91,811
Capital expenditures from continuing operations 140,787   17,805   39,472   41,165   42,345   136,734   47,054
Free cash flow (120,679 ) (17,733 ) (33,683 ) (42,459 ) (26,804 ) 60,426   44,757
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Year Ended December 31, 2018
       
SilverGoldTotal
In thousands except per ounce amountsPalmarejo   Rochester   Silvertip   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 180,832   $ 126,586 $ 40,855   $ 348,273 $ 141,872   $ 78,273   $ 220,145 $ 568,418
Amortization 60,744   20,909   5,235   86,888   29,508   11,072   40,580   127,468  
Costs applicable to sales $ 120,088 $ 105,677 $ 35,620 $ 261,385 $ 112,364 $ 67,201 $ 179,565 $ 440,950
Silver equivalent ounces sold 14,164,699 8,021,919 617,980 22,804,598 33,780,278
Gold equivalent ounces sold         106,555   76,373   182,928    
Costs applicable to sales per ounce $ 8.48 $ 13.17 $ 57.64 $ 11.46 $ 1,055 $ 880 $ 982 $ 13.05
Inventory adjustments (0.02 ) (0.13 ) (43.24 ) (1.23 ) (5 ) (4 ) (4 ) (0.85 )
Adjusted costs applicable to sales per ounce $ 8.46 $ 13.04 $ 14.40 $10.23   $ 1,050 $ 876 $ 978 $ 12.20  
 
Costs applicable to sales per average spot ounce $ 7.25 $ 11.59 $ 48.66 $ 9.89 $ 10.71
Inventory adjustments (0.02 ) (0.12 ) (36.50 ) (1.06 ) (0.70 )
Adjusted costs applicable to sales per average spot ounce $ 7.23 $ 11.47 $ 12.16 $8.83   $ 10.01  
 
Costs applicable to sales $ 440,950
Treatment and refining costs 5,469
Sustaining capital(1) 100,871
General and administrative 31,345
Exploration 25,397
Reclamation 18,668
Project/pre-development costs 5,266  
All-in sustaining costs$627,966
Silver equivalent ounces sold 22,804,598
Kensington and Wharf silver equivalent ounces sold 10,975,680  
Consolidated silver equivalent ounces sold 33,780,278  
All-in sustaining costs per silver equivalent ounce$18.59  
Inventory adjustments $ (0.85 )
Adjusted all-in sustaining costs per silver equivalent ounce$17.74  
 
Consolidated silver equivalent ounces sold (average spot) 41,178,098  
All-in sustaining costs per average spot silver equivalent ounce$15.25  
Inventory adjustments $ (0.70 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$14.55  
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended December 31, 2018
 
    Silver   Gold   Total
In thousands except per ounce amountsPalmarejo   Rochester   Silvertip   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 42,119   $ 35,365 $ 28,246   $ 105,730 $ 30,703   $ 16,839   $ 47,542 $ 153,272
Amortization 14,992   5,992   4,161   25,145   9,437   2,184   11,621   36,766  
Costs applicable to sales $ 27,127 $ 29,373 $ 24,085 $ 80,585 $ 21,266 $ 14,655 $ 35,921 $ 116,506
Silver equivalent ounces sold 2,954,615 2,310,196 351,315 5,616,126 8,044,146
Gold equivalent ounces sold         24,979   15,488   40,467    
Costs applicable to sales per ounce $ 9.18 $ 12.71 $ 68.56 $ 14.35 $ 851 $ 946 $ 888 $ 14.48
Inventory adjustments (0.07 ) (0.14 ) (51.16 ) (3.29 ) (9 ) (8 ) (8 ) (2.34 )
Adjusted costs applicable to sales per ounce $ 9.11 $ 12.57 $ 17.40 $11.06   $ 842 $ 938 $ 880 $ 12.14  
 
Costs applicable to sales per average spot ounce $ 7.68 $ 10.95 $ 56.71 $ 12.14 $ 11.60
Inventory adjustments (0.06 ) (0.12 ) (42.32 ) (2.79 ) (1.87 )
Adjusted costs applicable to sales per average spot ounce $ 7.62 $ 10.83 $ 14.39 $9.35   $ 9.73  
 
Costs applicable to sales $ 116,506
Treatment and refining costs 1,677
Sustaining capital 29,675
General and administrative 7,163
Exploration 4,127
Reclamation 4,924
Project/pre-development costs 2,191  
All-in sustaining costs$166,263
Silver equivalent ounces sold 5,616,126
Kensington and Wharf silver equivalent ounces sold 2,428,020  
Consolidated silver equivalent ounces sold 8,044,146  
All-in sustaining costs per silver equivalent ounce$20.67  
Inventory adjustments $ (2.34 )
Adjusted all-in sustaining costs per silver equivalent ounce$18.33  
 
Consolidated silver equivalent ounces sold (average spot) 10,070,442  
All-in sustaining costs per average spot silver equivalent ounce$16.51  
Inventory adjustments $ (1.87 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$14.64  
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended September 30, 2018
       
SilverGoldTotal
In thousands except per ounce amountsPalmarejo   Rochester   Silvertip   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 46,348   $ 32,842 $ 12,608   $ 91,798 $ 35,153   $ 20,857   $ 56,010 $ 147,808
Amortization 14,794   5,294   1,073   21,161   6,912   2,878   9,790   30,951  
Costs applicable to sales $ 31,554 $ 27,548 $ 11,535 $ 70,637 $ 28,241 $ 17,979 $ 46,220 $ 116,857
Silver equivalent ounces sold 3,361,893 2,103,584 266,666 5,732,143 8,475,883
Gold equivalent ounces sold         25,648   20,081   45,729    
Costs applicable to sales per ounce $ 9.39 $ 13.10 $ 43.26 $ 12.32 $ 1,101 $ 895 $ 1,011 $ 13.79
Inventory adjustments   (0.06 ) (32.80 ) (1.55 ) (10 )   (6 ) (1.08 )
Adjusted costs applicable to sales per ounce $ 9.39 $ 13.04 $ 10.46 $10.77   $ 1,091 $ 895 $1,005 $ 12.71  
 
Costs applicable to sales per average spot ounce $ 7.93 $ 11.48 $ 36.69 $ 10.55 $ 11.25
Inventory adjustments   (0.06 ) (28.00 ) (1.33 ) (0.88 )
Adjusted costs applicable to sales per average spot ounce $ 7.93 $ 11.42 $ 8.69 $9.22   $ 10.37  
 
Costs applicable to sales $ 116,857
Treatment and refining costs 1,551
Sustaining capital 19,236
General and administrative 7,729
Exploration 8,157
Reclamation 4,545
Project/pre-development costs 1,137  
All-in sustaining costs$159,212
Silver equivalent ounces sold 5,732,143
Kensington and Wharf silver equivalent ounces sold 2,743,740  
Consolidated silver equivalent ounces sold 8,475,883  
All-in sustaining costs per silver equivalent ounce$18.78  
Inventory adjustments $ (1.08 )
Adjusted all-in sustaining costs per silver equivalent ounce$17.70  
 
Consolidated silver equivalent ounces sold (average spot)10,385,649  
All-in sustaining costs per average spot silver equivalent ounce$15.33  
Inventory adjustments $ (0.88 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$14.45  
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended June 30, 2018
       
SilverGoldTotal
In thousands except per ounce amountsPalmarejo   Rochester   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 44,943   $ 29,244   $ 74,187 $ 40,668   $ 22,611   $ 63,279 $ 137,466
Amortization 14,633   4,793   19,426   6,441   3,353   9,794   29,220  
Costs applicable to sales $ 30,310 $ 24,451 $ 54,761 $ 34,227 $ 19,258 $ 53,485 $ 108,246
Silver equivalent ounces sold 3,964,208 1,819,072 5,783,280 8,870,100
Gold equivalent ounces sold       28,165   23,282   51,447    
Costs applicable to sales per ounce $ 7.65 $ 13.44 $ 9.47 $ 1,215 $ 827 $ 1,040 $ 12.20
Inventory adjustments (0.01 ) (0.08 ) (0.03 ) (20 ) (3 ) (12 ) (0.09 )
Adjusted costs applicable to sales per ounce $ 7.64 $ 13.36 $9.44   $ 1,195 $ 824 $1,028 $ 12.11  
 
Costs applicable to sales per average spot ounce $ 6.65 $ 11.94 $ 8.29 $ 10.15
Inventory adjustments (0.01 ) (0.07 ) (0.03 ) (0.08 )
Adjusted costs applicable to sales per average spot ounce $ 6.64 $ 11.87 $8.26   $ 10.07  
 
Costs applicable to sales $ 108,246
Treatment and refining costs 1,046
Sustaining capital 28,571
General and administrative 7,650
Exploration 6,429
Reclamation 4,667
Project/pre-development costs 517  
All-in sustaining costs$157,126
Silver equivalent ounces sold 5,783,280
Kensington and Wharf silver equivalent ounces sold 3,086,820  
Consolidated silver equivalent ounces sold 8,870,100  
All-in sustaining costs per silver equivalent ounce$17.71  
Inventory adjustments $ (0.09 )
Adjusted all-in sustaining costs per silver equivalent ounce$17.62  
 
Consolidated silver equivalent ounces sold (average spot)10,667,255  
All-in sustaining costs per average spot silver equivalent ounce$14.73  
Inventory adjustments $ (0.08 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$14.65  
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended March 31, 2018
       
SilverGoldTotal
In thousands except per ounce amountsPalmarejo   Rochester   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 47,421   $ 29,136   $ 76,557 $ 35,347   $ 17,966   $ 53,313 $ 129,870
Amortization 16,325   4,831   21,156   6,717   2,657   9,374   30,530  
Costs applicable to sales $ 31,096 $ 24,305 $ 55,401 $ 28,630 $ 15,309 $ 43,939 $ 99,340
Silver equivalent ounces sold 3,883,983 1,789,007 5,672,990 8,390,090
Gold equivalent ounces sold       27,763   17,522   45,285    
Costs applicable to sales per ounce $ 8.01 $ 13.59 $ 9.77 $ 1,031 $ 874 $ 970 $ 11.84
Inventory adjustments   (0.26 ) (0.08 ) (21 ) (4 ) (15 ) (0.13 )
Adjusted costs applicable to sales per ounce $ 8.01 $ 13.33 $9.69   $ 1,010 $ 870 $955 $ 11.71  
 
Costs applicable to sales per average spot ounce $ 6.94 $ 12.13 $ 8.55 $ 9.87
Inventory adjustments   (0.24 ) (0.07 ) (0.11 )
Adjusted costs applicable to sales per average spot ounce $ 6.94 $ 11.89 $8.48   $ 9.76  
 
Costs applicable to sales $ 99,340
Treatment and refining costs 1,195
Sustaining capital 23,389
General and administrative 8,804
Exploration 6,683
Reclamation 4,532
Project/pre-development costs 1,421  
All-in sustaining costs$145,364
Silver equivalent ounces sold 5,672,990
Kensington and Wharf silver equivalent ounces sold 2,717,100  
Consolidated silver equivalent ounces sold 8,390,090  
All-in sustaining costs per silver equivalent ounce$17.33  
Inventory adjustments $ (0.13 )
Adjusted all-in sustaining costs per silver equivalent ounce$17.20  
 
Consolidated silver equivalent ounces sold (average spot)10,066,759  
All-in sustaining costs per average spot silver equivalent ounce$14.44  
Inventory adjustments $ (0.11 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$14.33  
 
Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Year Ended December 31, 2017
       
SilverGoldTotal
In thousands except per ounce amountsPalmarejo   Rochester   Endeavor   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 219,920   $ 130,227 $ 1,046   $ 351,193 $ 152,118   $ 82,334   $ 234,452 $ 585,645
Amortization 73,744   22,306   301   96,351   36,022   13,012   49,034   145,385  
Costs applicable to sales $ 146,176 $ 107,921 $ 745 $ 254,842 $ 116,096 $ 69,322 $ 185,418 $ 440,260
Silver equivalent ounces sold 15,490,734 8,209,888 107,027 23,807,649 37,334,889
Gold equivalent ounces sold         125,982   99,472   225,454    
Costs applicable to sales per ounce $ 9.44 $ 13.15 $ 6.96 $ 10.70 $ 922 $ 697 $ 822 $ 11.79
Inventory adjustments (0.08 ) (0.07 )   (0.08 ) (2 ) 3     (0.05 )
Adjusted costs applicable to sales per ounce $ 9.36 $ 13.08 $ 6.96 $10.62   $ 920 $ 700 $822 $ 11.74  
 
Costs applicable to sales per average spot ounce $ 8.45 $ 12.04 $ 9.66 $ 10.24
Inventory adjustments (0.07 ) (0.07 ) (0.07 ) (0.04 )
Adjusted costs applicable to sales per average spot ounce $ 8.38 $ 11.97 $9.59   $ 10.20  
 
Costs applicable to sales $ 440,260
Treatment and refining costs 5,912
Sustaining capital(1) 65,010
General and administrative 33,616
Exploration 30,311
Reclamation 14,910
Project/pre-development costs 5,543  
All-in sustaining costs$595,562
Silver equivalent ounces sold 23,807,649
Kensington and Wharf silver equivalent ounces sold 13,527,240  
Consolidated silver equivalent ounces sold 37,334,889  
All-in sustaining costs per silver equivalent ounce$15.95  
Inventory adjustments $ (0.05 )
Adjusted all-in sustaining costs per silver equivalent ounce$15.90  
 
Consolidated silver equivalent ounces sold (average spot)42,969,841  
All-in sustaining costs per average spot silver equivalent ounce$13.86  
Inventory adjustments $ (0.04 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$13.82  
 

Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce

for Three Months Ended December 31, 2017

 
    Silver   Gold   Total
In thousands except per ounce amountsPalmarejo   Rochester   Endeavor   TotalKensington   Wharf   Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 58,775   $ 41,006 $   $ 99,781 $ 42,640   $ 24,033   $ 66,673 $ 166,454
Amortization 22,749   6,960     29,709   10,633   4,129   14,762   44,471  
Costs applicable to sales $ 36,026 $ 34,046 $ $ 70,072 $ 32,007 $ 19,904 $ 51,911 $ 121,983
Silver equivalent ounces sold 4,680,802 2,657,975 7,338,777 11,232,057
Gold equivalent ounces sold         35,633   29,255   64,888    
Costs applicable to sales per ounce $ 7.70 $ 12.81 $ $ 9.55 $ 898 $ 680 $ 800 $ 10.86
Inventory adjustments (0.16 ) (0.04 )   (0.12 ) (2 ) 2     (0.08 )
Adjusted costs applicable to sales per ounce $ 7.54 $ 12.77 $ $9.43   $ 896 $ 682 $800 $ 10.78  
 
Costs applicable to sales per average spot ounce $ 6.78 $ 11.41 $ 8.45 $ 9.21
Inventory adjustments (0.14 ) (0.04 ) (0.10 ) (0.07 )
Adjusted costs applicable to sales per average spot ounce $ 6.64 $ 11.37 $8.35   $ 9.14  
 
Costs applicable to sales $ 121,983
Treatment and refining costs 1,600
Sustaining capital 18,520
General and administrative 9,120
Exploration 7,455
Reclamation 4,075
Project/pre-development costs 578  
All-in sustaining costs$163,331
Silver equivalent ounces sold 7,338,777
Kensington and Wharf silver equivalent ounces sold 3,893,280  
Consolidated silver equivalent ounces sold 11,232,057  
All-in sustaining costs per silver equivalent ounce$14.53  
Inventory adjustments $ (0.08 )
Adjusted all-in sustaining costs per silver equivalent ounce$14.45  
 
Consolidated silver equivalent ounces sold (average spot)13,246,634  
All-in sustaining costs per average spot silver equivalent ounce$12.33  
Inventory adjustments $ (0.07 )
Adjusted all-in sustaining costs per average spot silver equivalent ounce$12.26  
 

Reconciliation of Costs Applicable to Sales for 2019 Guidance

 
In thousands except per ounce amounts     Palmarejo     Rochester     Kensington     Wharf     Silvertip     Total
Costs applicable to sales, including amortization (U.S. GAAP) $ 196,310 $ 131,918 $ 154,285 $ 90,299 $ 156,417 $ 729,229
Amortization 62,808   21,606   36,909     11,583     57,177   190,083  
Costs applicable to sales $ 133,502 $ 110,312 $ 117,376 $ 78,716 $ 99,240 $ 539,146
By-product credit         (1,167 )     (1,167 )
Adjusted costs applicable to sales $ 133,502 $ 110,312 $ 117,376 $ 77,549 $ 99,240 $ 537,979
 
Metal Sales
Gold ounces 100,000 45,000 121,000 85,500
Silver ounces 6,850,000 4,800,000 75,000 2,100,000
Zinc pounds 35,000,000
Lead pounds 28,500,000
 
Revenue Split
Gold 52% 43% 100% 100%
Silver 48% 57% 32%
Zinc 40%
Lead 28%
 
Costs applicable to sales per ounce
Gold $650 - $750 $1,000 - $1,100 $950 - $1,050 $850 - $950
Silver $9.00 - $10.00 $12.50 - $13.50 $14.00 - $16.00
Zinc $1.00 - $1.25
Lead $0.85 - $1.05
 

Contacts:

For Additional Information
Coeur Mining, Inc.
104 S. Michigan Avenue, Suite 900
Chicago, IL 60603
Attention: Paul DePartout, Director, Investor Relations
Phone: (312) 489-5800
www.coeur.com

Source: Coeur Mining, Inc.

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