Quarterly Results

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Second Quarter 2016 Highlights

  • Production of 9.6M silver equivalent ounces1, a 19% increase over 1Q 2016
  • Adj. AISC of $13.27 per realized AgEqOz1, a 10% decrease year-over-year
  • Adj. CAS of $10.05 per realized AgEqOz1, a 14% decrease, and Adj. CAS of $644 per realized AuEqOz1, a 21% decrease year-over-year
  • Quarterly adj. EBITDA1 of $72.4M, nearly double 1Q 2016; TTM adj. EBITDA of $171M
  • Completed sales of non-core assets for total year-to-date consideration of $23.8M
  • Cash and equivalents of $257.6M at June 30, 2016, including proceeds from a $75.0 million “at-the-market” equity offering completed during the quarter
  • Triggered shift to much more favorable terms of new Franco-Nevada gold stream at Palmarejo
  • On July 15, repaid $99M remaining principal on term loan, reducing total debt by nearly 20% and eliminating $9M of annual interest expense
  • Total debt / LTM adj. EBITDA1 of 2.5x following repayment of term loan, down from 5.9x a year ago

From Coeur's President & Chief Executive Officer, Mitchell J. Krebs

"In addition to strong production increases, we again delivered industry-leading cost reductions during the second quarter. Combined with higher realized silver and gold prices, our quarterly adjusted EBITDA nearly doubled to $72.4 million, and we generated positive free cash flow of $12.2 million during the quarter.

"Along with our strong operating and financial performance, we achieved two significant milestones subsequent to quarter-end: the satisfaction of the minimum ounce obligation on Palmarejo's Franco-Nevada royalty and the repayment of the $100 million term loan. The transition to the improved Franco-Nevada terms represents a watershed event, positioning Palmarejo to be a significant contributor to free cash flow going forward. Combined with the debt repayment and the commensurate reduction to interest expense, our operations are poised to generate significant free cash flow in the second half of 2016.

"During the second half of the year, we plan to increase our exploration budget by approximately $8 million, primarily to upgrade resources to reserves at Palmarejo, Kensington, and Rochester. Nearly half of the $8 million increase will go toward expensed exploration activities and results in an increase to our full-year expensed exploration guidance range to $14 - $16 million. The other half of the $8 million increase will go toward capitalized exploration, resulting in an increase to our full-year guidance range to $16 - $18 million. In addition to this high-return incremental investment in exploration activities, we anticipate increasing our capital expenditure budget by an additional $10 million during the second half, bringing the total increase to $15 million for full-year guidance of $105 - $115 million. These additional funds will support additional underground development at Guadalupe and Jualin and will allow us to accelerate the construction of incremental leach pad capacity at Rochester now that all permits have been received.” (see "Non-U.S. GAAP Measures" in the second quarter 2016 results press release)

Financial Highlights

(Amounts in millions, except per share amounts, gold ounces produced & sold, and per-ounce metrics) 2Q 2016 1Q 2016
Revenue $ 182.0 $ 148.4
Costs Applicable to Sales $ 100.5 $ 101.6
Net income $ 14.5 $ (20.4)
Adjusted Net Income (Loss)1 $ 17.3 $ (11.0)
Adjusted EBITDA1 $ 72.4 $ 36.8
Cash Flow From Operating Activities $ 45.9 $ 6.6
Silver Ounces Sold 4.0 3.5
Gold Ounces Sold 88,543 79,091
Silver Equivalent Ounces Sold1 9.3 8.3
Silver Equivalent Ounces Sold (Realized)1 10.4 9.7
Adjusted Costs Applicable to Sales per AgEq Ounce1 $ 10.71 $ 12.05
Adjusted Costs Applicable to Sales per Realized AgEq Ounce1 $ 10.05 $ 11.08
Adjusted Costs Applicable to Sales per AuEq Ounce1 $ 644 $ 721
Adjusted All-in Sustaining Costs per AgEq Ounce1 $ 14.82 $ 16.05
Adjusted All-in Sustaining Costs per Realized AgEq Ounce1 $ 13.27 $ 13.73
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 and adjusted costs applicable to sales per silver equivalent ounce are non-GAAP measures. Please see tables in the Appendix of the second quarter 2016 results news release for the reconciliation to U.S. GAAP. For purposes of silver and gold equivalence, a 60:1 silver to gold ratio is assumed except where noted as average realized prices.

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Coeur Mining, Inc.
104 S. Michigan Avenue, Suite 900 Chicago, Illinois, 60603 - (312) 489-5800