Coeur Reports First Quarter 2019 Results
Coeur Mining, Inc. (“Coeur” or the “Company”) (NYSE: CDE) today reported first quarter 2019 financial results, including revenue of $154.9 million, adjusted EBITDA1 of $26.1 million and cash flow from operating activities of $(11.8) million. Prior to changes in working capital, cash flow from operating activities totaled $21.5 million. Including a non-cash write down of $15.4 million taken in the quarter, the Company reported GAAP net loss from continuing operations of $24.9 million, or $0.12 per share. On an adjusted basis1, the Company reported a net loss of $23.0 million, or $0.11 per share.
The Company is reaffirming full-year 2019 production guidance of 334,000 - 372,000 ounces of gold, 12.2 - 14.7 million ounces of silver, 25 - 40 million pounds of zinc and 20 - 35 million pounds of lead. In addition, full-year cost guidance is being reaffirmed.
- Production on-track to achieve full-year guidance ranges - Full-year financial and operational results expected to benefit from higher second half production driven by the anticipated impact of high-pressure grinding roll (“HPGR”) technology at Rochester, higher recovery rates and production levels at Palmarejo, and improved plant performance and higher grades at Silvertip
- Strong operating cost performance across the Company’s portfolio - First quarter adjusted costs applicable to sales (“CAS”)1 at each operation either below or in-line with full-year guidance ranges. Site-level unit costs expected to trend lower due to higher expected second half production levels
- Installation of HPGR unit at Rochester on-track - Despite unseasonably high snowfall levels, commissioning of the HPGR unit remains on-budget and on-schedule. Commissioning activities now underway and impact on silver recovery rates expected to be seen beginning mid-year
- Improved results at Silvertip with continued focus on achieving positive cash flow - Although slower than originally expected, results at Silvertip improved quarter-over-quarter. March 2019 represented the strongest month of performance since acquisition with revenues more than doubling in the first quarter. Current areas of focus include (i) sustaining consistent levels of mill availability to allow for recovery rate optimization, (ii) accelerating underground development rates to enhance mining flexibility and access to higher grade ore, and (iii) workforce training and retention initiatives
- Kensington now shifting focus at Jualin from development activities to production - Mining activities at Jualin transitioned from development to production during the first quarter, with the high-grade deposit contributing approximately 10% of Kensington’s production at an average grade of 0.41 ounces per ton (“oz/t”). Jualin is expected to account for approximately 20% of Kensington’s total production in 2019. Higher mining rates from Jualin are expected to contribute to higher production levels and lower unit costs throughout the remainder of 2019
- Continued commitment to success-based exploration program - Following last year’s strong reserve and resource increases, 2019 drilling programs commenced by investing a total of $6.6 million in resource expansion and conversion drilling targeting Palmarejo and Kensington as well as the new Sterling and Crown deposits
- Cash and cash equivalents as of March 31, 2019 of $69.0 million - $135.0 million currently drawn on the Company’s $250.0 million senior secured revolving credit facility, the terms of which were amended subsequent to the end of the first quarter to enhance near-term financial flexibility. Liquidity levels expected to climb during the second half of 2019 due to higher anticipated production levels and lower unit costs
“First quarter operational and financial results were consistent with our expectations,” said Mitchell J. Krebs, President and Chief Executive Officer. “Although Silvertip’s ongoing ramp-up remains a near-term drag on our free cash flow and liquidity levels until it achieves steady-state, our balanced portfolio of operations are advancing several key initiatives that are expected to help us achieve our objective of returning to positive free cash flow in 2019.”