Coeur Mining, Inc. · NYSE:CDE
Coeur Mining — FY2014 Earnings Presentation
37 slides from Coeur Mining's earnings presentation, Feb 19, 2015
Slide 1: Fourth Quarter and Year-End 2014 Financial Results
Fourth Quarter and Year‐End 2014 Financial Results Conference Call and Webcast February 19, 2015
Slide 2: Cautionary Statements
Cautionary Statements This presentation contains forward‐looking statements within the meaning of securities legislation in the United States and Canada, including statements regarding anticipated production, costs, crushing rates, recovery rates, capital and exploration expenditures, exploration an
Slide 3: 2014 and Year-to-Date 2015 Achievements
2014 and Year‐to‐Date 2015 Achievements 2014 production of 32.2 million AgEq ounces, at high‐end of guidance Achieved significant cost savings YOY including a 26% reduction in G&A, 36% lower capital expenditures, 10% decline in exploration spending, and costs applicable to sales 8% below initial 201
Slide 4: Fourth Quarter and Full-Year 2014 Highlights
Fourth Quarter and Full‐Year 2014 Highlights Quarter Full‐Year Full‐Year Full‐Year in millions US$ 4Q 2014 3Q 2014 Variance 2014 2013 Variance Revenue $140.6 $170.9 (18%) $635.7 $746.0 (15%) Costs applicable to sales 124.7 125.9 (1%) 477.9 463.7 3% Exploration expense 5.7 6.6 (14%) 30.6 34.0 (10%) G
Slide 5: Fourth Quarter and Full-Year 2014 Highlights (continued)
Fourth Quarter and Full‐Year 2014 Highlights (continued) Quarter Full‐Year Full‐Year YOY 4Q 2014 3Q 2014 Variance 2014 2013 Variance Average realized silver price per ounce $16.40 $19.46 (16%) $18.87 $23.94 (21%) Average realized gold price per ounce $1,186 $1,260 (6%) $1,252 $1,327 (6%) Silver ounc
Slide 6: Fourth Quarter 2014 Cash Flow Bridge
Fourth Quarter 2014 Cash Flow Bridge Disciplined capital allocation helps maintain a strong cash balance 350 300 $38.6 $295.4 $9.7 $20.1 $10.0 $270.9 250 $37.5 $5.3 in millions 200 150 100 50 0 Cash Balance Adjusted Net Loss 2 Amortization Capital Palmarejo Royalty Royalty Purchases Other Cash Balan
Slide 7: Well-Capitalized with Financial Flexibility
Well‐Capitalized with Financial Flexibility Debt Maturity Schedule Amount Maturity Liquidity $270.9 (millions) Net Debt = $207.5 Senior unsecured notes $437.5 2021 Convertible notes $5.3 2028 Debt $460.9 $17.5 San Bartolomé letter of credit $10.3 2017 San Bartolomé letter of credit $4.5 2015 $0 $100
Slide 8: Achieved Significant Cost Savings in 2014
Achieved Significant Cost Savings in 2014 10% 26% reduction reduction Reduced Reduced Exploration G&A $3M $14M (2014 vs 2013) (2014 vs 2013) Reduced Reduced CAS Capex $39M $37M (2014 vs initial FY (2014 vs 2013) Guidance) 8% 36% reduction reduction $93 million in total cost reductions in 2014 NYSE:
Slide 9: Non-Cash Impairment Charge
Non‐Cash Impairment Charge Recorded after‐tax non‐cash impairment charge of $1.0 billion in 4Q 2014 Largest portion related to Palmarejo and La Preciosa mining properties due to lower reserve and resource price assumptions Impairment Total After‐Tax (in millions) Tax benefit Mining Property PP&E
Slide 10: YE 2014 Mineral Reserves and Resources: Significantly Reduced Price Assumptions
YE 2014 Mineral Reserves and Resources: Significantly Reduced Price Assumptions Reserve metal price assumptions ($/oz) Silver Gold $25 $1,450 Reserves assume metal prices of $19 per $1,275 ounce of silver and $1,275 per ounce of $19 gold, down 24% and 12%, respectively Reflects focus on higher‐g
Slide 11: YE 2014 Mineral Reserves and Resources: Higher-Grade, Higher-Quality Ounces
YE 2014 Mineral Reserves and Resources: Higher‐Grade, Higher‐ Quality Ounces P&P reserves of 390.7 million silver equivalent ounces, a 2% Proven & Probable Reserves increase from YE 2013 M&I resources of 292.4 million silver equivalent ounces, a Ounces in thousands 45% decrease from YE 2013 280,
Slide 12: Palmarejo: Transitioning to Lower Tonnage, Higher-Grade, Higher-Margin Operation
Palmarejo: Transitioning to Lower Tonnage, Higher‐Grade, Higher‐Margin Operation 4Q 2014 Highlights Adjusted CAS per AgEq oz1 was $15.70 in 4Q 2014, 9% higher than 3Q 2014 due to a decline in grade and recovery rates Modifications in the processing facility expected to result in improved recover
Slide 13: Palmarejo: Transitioning to Lower Tonnage, Higher-Grade, Higher-Margin Operation
Palmarejo: Transitioning to Lower Tonnage, Higher‐Grade, Higher‐Margin Operation $15.70 $13.48 $14.43 $12.43 $13.13 $11.95 $10.28 $9.74 2.0 1.9 2.0 1.8 1.8 1.6 35,486 1.5 28,191 29,893 1.4 ounces 25,216 22,965 23,706 22,514 15,237 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 Gold production Silve
Slide 14: Rochester: Mining Costs per Ton Declined 30% in 2014
Rochester: Mining Costs per Ton Declined 30% in 2014 4Q 2014 Highlights Silver equivalent production increased 14% from 3Q 2014 CAS per AgEq oz1 were $14.27, down 4% from 3Q 2014 Costs per ton continue to trend lower Free cash flow2 of $7.5 million in 4Q was the highest level since 2012 Cr
Slide 15: Rochester: Higher Silver and Gold Production Drove Highest Cash Flow in Two Years
Rochester: Higher Silver and Gold Production Drove Highest Cash Flow in Two Years $15.83 $16.63 $14.80 $12.67 $15.79 $14.95 $14.27 $15.15 1,112 1,156 1,170 15,764 844 11,702 9,404 9,230 648 8,742 712 750 8,192 ounces 595 7,890 4,824 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1 Gold production S
Slide 16: Kensington: Robust Head-Grade and Strong Throughput Propels Improved Cost Performance
Kensington: Robust Head‐Grade and Strong Throughput Propels Improved Cost Performance 4Q 2014 Highlights Gold production of 33,533 ounces, 9% higher than 3Q 2014 CAS per gold ounce1 of $845, down 10% from 3Q 2014 as a result of strong throughput combined with robust grade and recovery performanc
Slide 17: Kensington: Robust Head-Grade and Strong Throughput Propels Improved Cost Performance
Kensington: Robust Head‐Grade and Strong Throughput Propels Improved Cost Performance $1,227 $894 $1,008 $900 $1,005 $937 $845 $677 36,469 33,533 30,773 28,323 28,089 25,206 25,428 22,583 ounces 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1 Gold production Costs applicable to sales per gold oz $
Slide 18: San Bartolomé: Stable Production and Cost Performance
San Bartolomé: Stable Production and Cost Performance 4Q 2014 Highlights Silver production, grades, recovery rates, and costs remain relatively stable Unit Costs FY 2014 4Q 2014 3Q 2014 2Q 2014 1Q 2014 FY 2013 Ore tons mined 2,591,181 756,197 745,592 863,879 585,513 2,921,947 Mining costs per ton
Slide 19: San Bartolomé: Stable Production and Cost Performance
San Bartolomé: Stable Production and Cost Performance $15.26 $14.91 $13.91 $13.93 $13.85 $14.22 $13.41 $14.14 $13.25 1.4 1.5 1.5 1.5 1.4 1.5 1.5 1.5 ounces 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 Silver production (millions) Costs applicable to sales per silver equivalent oz 1 $32.8 $ in mil
Slide 20: 2015 Guidance
2015 Guidance Silver Production Gold Production 6,558 114,821 5,852 5,950 112,500 Ounces in thousands 4,850 4,100 4,189 86,673 76,000 Ounces 60,000 60,000 30,860 590 500 Palmarejo San Bartolomé Rochester Endeavor Kensington Palmarejo Rochester Wharf 2 1 1 2014 Actual 2015 Guidance Midpoint 2014 Actu
Slide 21: Appendix
Appendix
Slide 22: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted Net Income (Loss) in thousands FY 2014 4Q 2014 3Q 2014 2Q 2014 1Q 2014 FY 2013 Net income (loss) ($1,155,884) ($1,079,038) $3,466 ($43,121) ($37,191) ($650,563) Fair value adjustments, net (4,323) (5,622) (13,026) 6,498 7,827 (59,908) Stock‐b
Slide 23: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted EBITDA in thousands LTM 12/31/14 LTM 9/30/14 LTM 6/30/14 LTM 3/31/14 LTM 12/31/13 Net income (loss) ($1,155,884) ($658,374) ($708,105) ($700,024) ($650,563) Interest expense, net of capitalized interest 47,546 47,959 46,006 44,625 41,303 Inte
Slide 24: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total Year‐ended December 31, 2014 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $256,707 $
Slide 25: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total three months ended September 30, 2014 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $
Slide 26: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total three months ended March, 31, 2014 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $62,
Slide 27: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars thousands except per ounce costs) San Total Three months ended September 30, 2013 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $100
Slide 28: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total Three months ended March 31, 2013 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $55,5
Slide 29: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) All‐In Sustaining Costs in thousands except per ounce costs FY 2014 4Q 2014 3Q 2014 2Q 2014 1Q 2014 FY 2013 Costs applicable to sales, including amortization (U.S. GAAP) $635,516 $163,679 $166,675 $159,036 $146,125 $691,696 Amortization 157,571 37,227
Slide 30: External Growth - Strategic Investments
External Growth ‐ Strategic Investments Apogee Silver (Cachinal project, Chile; 6.4% ownership interest): Completed sale of Bolivia assets to Prophecy Coal Corp. for $3.9M, including $250,000 cash and 60 million Prophecy common shares Caracara Silver (Princesa project, Peru; 3.2% ownership int
Slide 31: Coeur's Mineral Reserves
Coeur’s Mineral Reserves Grade (oz/ton) Ounces (contained) Year‐end 2014 Location Short tons Silver Gold Silver Gold Proven Reserves Rochester Nevada, USA 89,077,000 0.56 0.004 49,786,000 346,000 San Bartolomé Bolivia 1,206,000 2.73 ‐ 3,287,000 ‐ Kensington Alaska, USA 417,000 ‐ 0.187 ‐ 78,000 Endea
Slide 32: Coeur's Measured and Indicated Mineral Resources
Coeur’s Measured and Indicated Mineral Resources (Excluding Reserves) Grade (oz/ton) Ounces (contained) Year‐end 2014 Location Short tons Silver Gold Silver Gold Measured Resources Rochester Nevada, USA 72,228,000 0.45 0.003 32,565,000 218,000 Martha Argentina ‐ ‐ ‐ ‐ ‐ San Bartolomé Bolivia ‐ ‐ ‐ ‐
Slide 33: Coeur's Inferred Mineral Resources
Coeur’s Inferred Mineral Resources Grade (oz/ton) Ounces (contained) Year‐end 2014 Location Short tons Silver Gold Silver Gold Inferred Resources Rochester Nevada, USA 96,039,000 0.42 0.003 40,789,000 263,000 Martha Argentina 204,000 4.75 0.005 969,000 1,000 San Bartolomé Bolivia 66,000 1.68 ‐ 111,0
Slide 34: Wharf's Historical Mineral Reserves and Resources
Wharf’s Historical Mineral Reserves and Resources Tons Grade (oz/t) Ounces (000s) (000s) Gold Silver Gold Silver Proven and Probable Reserves Proven Reserves 15,179 0.022 0.078 340 1,190 Probable Reserves 8,245 0.026 0.108 220 890 Total Proven and Probable Reserves 23,424 0.024 0.089 560 2,080 Measu
Slide 35: Executive Leadership
Executive Leadership Mitchell J. Krebs – President and Chief Executive Officer. Mr. Krebs joined Coeur in 1995 after spending several years in the investment banking industry in New York. Mr. Krebs has held various positions in the corporate development department, including Senior Vice President of
Slide 36: Board of Directors
Board of Directors Robert E. Mellor – Former Chairman, Chief Executive Officer and President of Building Materials Holding Corporation (distribution, manufacturing and sales of building materials and component products) from 1997 to January 2010, director from 1991 to January 2010; member of the boa
Slide 37: Contact Information
Contact Information Corporate Office: Coeur Mining, Inc. 104 S. Michigan Ave, Suite 900 Chicago, Illinois 60603 Main Tel: (312) 489‐5800 Stock Tickers: CDE: NYSE Warrant Tickers: CDE.WS: NYSE; CDM.WT: TSX Website: coeur.com Contact: Bridget Freas Donna Mirandola Director, Investor Relations Director