Coeur Reports First Quarter 2016 Results
14% Decline in Adjusted AISC1 Drives 46% Growth in Quarterly Adjusted EBITDA1 to $34.6 million
Chicago, Illinois - April 27, 2016 - Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE: CDE) reported first quarter 2016 revenue of $148.4 million, adjusted EBITDA1 of $34.6 million, adjusted net loss1 of $0.04 per share, and cash flow from operating activities of $6.6 million2. The Company sold 3.5 million ounces of silver and 79,091 ounces of gold and during the quarter. Adjusted all-in sustaining costs per realized silver equivalent ounce1 of $13.73 dropped 14% compared to the same quarter last year (9% decline assuming a constant 60:1 ratio). Adjusted costs applicable to sales per realized silver equivalent ounce1 of $11.08 declined 14% compared with the first quarter last year (12% decline assuming a constant 60:1 ratio). Adjusted costs applicable to sales per gold equivalent ounce1 of $721 declined 10% compared to the first quarter last year.
• Silver production was 3.4 million ounces and gold production was 78,072 ounces, or 8.1 million silver equivalent ounces, as previously announced on April 7, 2016
• Silver sales were 3.5 million ounces and gold sales were 79,091 ounces, or 8.3 million silver equivalent ounces
• Adjusted all-in sustaining costs were $13.73 per realized silver equivalent ounce. Using a 60:1 equivalence, adjusted all-in sustaining costs were $16.05 per silver equivalent ounce
• Adjusted costs applicable to sales were $11.08 per realized silver equivalent ounce. Using a 60:1 equivalence, adjusted costs applicable to sales per silver equivalent ounce were $12.05
• Adjusted costs applicable to sales per gold equivalent ounce were $721
• Adjusted EBITDA was $34.6 million, a 16% increase from the fourth quarter 2015
• Capital expenditures totaled $22.2 million, driven by development of the Jualin deposit at Kensington and the Guadalupe and Independencia underground deposits at Palmarejo
• Cash and equivalents of $173.4 million at March 31, 2016
• Expected total consideration of $24.8 million from sales of non-core assets
"I am pleased with our strong cost performance in the first quarter, which is tracking at the low-end of cost guidance set at the beginning of the year," said Mitchell J. Krebs, Coeur's President and Chief Executive Officer. "These sustained lower operating costs, combined with the positive momentum we have seen in silver and gold prices so far this year, have led to a 16% increase in adjusted EBITDA to $34.6 million. "We have made significant progress repositioning our assets through industry-leading cost reductions, operational efficiency improvements, and the focus on higher-quality, higher-margin silver and gold ounces, which is reflected in this quarter's results. As underground production rates continue to accelerate at the Guadalupe and Independencia deposits at Palmarejo, ore placement rates at Rochester increase, development of higher-grade mineralization at Kensington progresses, and with the first full-year of contribution from the Wharf mine which we acquired last year, we are well-positioned to generate strong free cash flow later this year."
The Company realized average silver and gold prices of $15.16 and $1,178 during the first quarter, which were 6% and 8% higher, respectively, compared with the fourth quarter and 10% and 2% lower, respectively, compared to last year's first quarter.
First quarter revenue decreased 10% compared with the fourth quarter and 3% compared with the first quarter 2015 to $148.4 million, primarily due to fewer silver and gold ounces sold from Palmarejo as a result of reduced mining rates as the operation transitions from predominantly open pit mining to entirely highergrade underground mining. Production began from the Independencia deposit in late January and mining rates are expected to climb during each remaining quarter of the year. Silver contributed 36% of metal sales and gold contributed 64% during the first quarter.
First quarter general and administrative expenses were $8.3 million, 6% lower compared to the first and fourth quarters last year. First quarter capital expenditures of $22.2 million were 26% lower compared to the fourth quarter and 26% higher than the first quarter last year due to development of the Jualin deposit at Kensington and development of the Guadalupe and Independencia deposits at Palmarejo. First quarter exploration expense totaled $1.7 million for discovery of new silver and gold mineralization, which was flat compared to the fourth quarter and 59% lower than the first quarter 2015.
First quarter adjusted EBITDA1 was $34.6 million, a 16% increase compared to the fourth quarter, primarily due to lower operating costs and higher metal prices, and up 46% compared to the first quarter last year as a result of lower costs and the addition of the Wharf mine. At March 31, 2016, LTM adjusted EBITDA1 totaled $126.5 million, an 8% increase from year-end 2015 and a 58% increase from the same period last year.
Adjusted net loss was $6.6 million, or $0.04 per share, in the first quarter, compared to an adjusted net loss of $38.6 million, or $0.27 per share, in the fourth quarter and $19.2 million, or $0.19 per share, in the first quarter 2015. The first quarter adjusted net loss primarily excludes fair value adjustments to royalty obligations, a $3.9 million reduction in carrying value of the Endeavor silver stream and El Gallo royalty, and stock-based compensation. First quarter cash flow from operating activities was $6.6 million, lower than the fourth quarter 2015 as a result of lower metal sales and a $16.6 million increase in working capital, primarily due to payment of accrued interest and an increase in ore inventory on the leach pad at Rochester.