Delaware | 001-34827 | 27-2301797 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
5619 Denver Tech Center Parkway, Suite 1000, Greenwood Village, CO | 80111 | |
(Address of principal executive offices) | (Zip Code) |
Exhibit Number | Description | ||
99.1 | Press Release issued by Molycorp, Inc. on May 7, 2014 |
MOLYCORP, INC. | ||
By: | /s/ Michael F. Doolan | |
Name: | Michael F. Doolan | |
Title: | Chief Financial Officer | |
Date: May 7, 2014 |
Exhibit Number | Description | ||
99.1 | Press Release issued by Molycorp, Inc. on May 7, 2014 |
March 31, 2014 | December 31, 2013 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 236,050 | $ | 314,317 | |||
Trade accounts receivable, net | 51,591 | 61,757 | |||||
Inventory | 166,630 | 171,783 | |||||
Prepaid expenses and other current assets | 34,854 | 29,210 | |||||
Total current assets | 489,125 | 577,067 | |||||
Non-current assets: | |||||||
Deposits | 26,005 | 25,997 | |||||
Property, plant and equipment, net | 1,756,090 | 1,762,874 | |||||
Inventory | 24,996 | 25,329 | |||||
Intangible assets, net | 324,964 | 330,867 | |||||
Investments | 47,152 | 48,875 | |||||
Goodwill | 228,750 | 228,750 | |||||
Other non-current assets | 6,554 | 7,043 | |||||
Total non-current assets | 2,414,511 | 2,429,735 | |||||
Total assets | $ | 2,903,636 | $ | 3,006,802 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Trade accounts payable | $ | 63,670 | $ | 84,449 | |||
Accrued expenses | 55,426 | 48,501 | |||||
Debt and capital lease obligations | 16,885 | 16,362 | |||||
Other current liabilities | 3,582 | 4,063 | |||||
Total current liabilities | 139,563 | 153,375 | |||||
Non-current liabilities: | |||||||
Asset retirement obligation | 16,218 | 16,966 | |||||
Deferred tax liabilities | 79,284 | 85,481 | |||||
Debt and capital lease obligations | 1,371,924 | 1,363,916 | |||||
Other non-current liabilities | 9,850 | 10,002 | |||||
Total non-current liabilities | 1,477,276 | 1,476,365 | |||||
Total liabilities | $ | 1,616,839 | $ | 1,629,740 | |||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Common stock, $0.001 par value; 350,000,000 shares authorized at March 31, 2014 and December 31, 2013 | 245 | 241 | |||||
Preferred stock, $0.001 par value; 5,000,000 shares authorized at December 31, 2013 | — | 2 | |||||
Additional paid-in capital | 2,191,404 | 2,194,405 | |||||
Accumulated other comprehensive loss | (7,303 | ) | (6,451 | ) | |||
Accumulated deficit | (926,535 | ) | (840,474 | ) | |||
Total Molycorp stockholders’ equity | 1,257,811 | 1,347,723 | |||||
Noncontrolling interests | 28,986 | 29,339 | |||||
Total stockholders’ equity | 1,286,797 | 1,377,062 | |||||
Total liabilities and stockholders’ equity | $ | 2,903,636 | $ | 3,006,802 |
First Quarter | Fourth Quarter | First Quarter | |||||||||
2014 | 2013 | 2013 | |||||||||
Revenues | $ | 118,526 | $ | 123,814 | $ | 145,398 | |||||
Costs of sales: | |||||||||||
Costs excluding depreciation and amortization | (125,473 | ) | (132,419 | ) | (135,531 | ) | |||||
Depreciation and amortization | (16,147 | ) | (18,444 | ) | (14,172 | ) | |||||
Gross loss | (23,094 | ) | (27,049 | ) | (4,305 | ) | |||||
Operating expenses: | |||||||||||
Selling, general and administrative | (17,956 | ) | (30,714 | ) | (26,551 | ) | |||||
Depreciation, amortization and accretion | (7,201 | ) | (11,764 | ) | (8,210 | ) | |||||
Research and development | (2,766 | ) | (4,696 | ) | (6,405 | ) | |||||
Impairment of goodwill and other long-lived assets | — | (119,403 | ) | — | |||||||
Operating loss | (51,017 | ) | (193,626 | ) | (45,471 | ) | |||||
Other expenses: | |||||||||||
Other expense (a) | 474 | (11,326 | ) | (451 | ) | ||||||
Interest expense, net of capitalized interest | (35,639 | ) | (24,877 | ) | (11,649 | ) | |||||
Loss before income taxes and equity earnings | (86,182 | ) | (229,829 | ) | (57,571 | ) | |||||
Income tax benefit | 1,907 | 32,021 | 22,490 | ||||||||
Equity in loss of affiliates | (1,723 | ) | (480 | ) | (3,072 | ) | |||||
Net loss | (85,998 | ) | (198,288 | ) | (38,153 | ) | |||||
Net income attributable to noncontrolling interests | (63 | ) | 3,980 | (818 | ) | ||||||
Net loss attributable to Molycorp stockholders | $ | (86,061 | ) | $ | (194,308 | ) | $ | (38,971 | ) | ||
Earnings per share of common stock: | |||||||||||
Net loss attributable to Molycorp stockholders | $ | (86,061 | ) | $ | (194,308 | ) | $ | (38,971 | ) | ||
Dividends on Convertible Preferred Stock | (2,846 | ) | (2,846 | ) | (2,846 | ) | |||||
Loss attributable to common stockholders | $ | (88,907 | ) | $ | (197,154 | ) | $ | (41,817 | ) | ||
Weighted average common shares outstanding—basic | 221,374,589 | 208,080,170 | 153,314,081 | ||||||||
Basic loss per share: | $ | (0.40 | ) | $ | (0.95 | ) | $ | (0.27 | ) | ||
Weighted average common shares outstanding—diluted | 221,374,589 | 208,080,170 | 153,314,081 | ||||||||
Diluted loss per share: | $ | (0.40 | ) | $ | (0.95 | ) | $ | (0.27 | ) | ||
(a) Includes net results from discontinued operations., which were nominal in the first quarter of 2014 and 2013, and $1,237 in the fourth quarter of 2013. |
Three Months Ended March 31, | |||||||
2014 | 2013 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (85,998 | ) | $ | (38,153 | ) | |
Adjustments to reconcile net loss to net cash from operating activities: | |||||||
Depreciation, amortization and accretion | 23,348 | 22,532 | |||||
Deferred income tax benefit | (6,097 | ) | (29,475 | ) | |||
Inventory write-downs | 17,371 | 22,125 | |||||
Release of inventory step-up value | 577 | 2,497 | |||||
Stock-based compensation | 822 | (325 | ) | ||||
Foreign exchange loss | 4 | 2,197 | |||||
Equity in results of affiliates | 1,723 | 3,072 | |||||
Other operating adjustments | 250 | (5,221 | ) | ||||
Net change in operating assets and liabilities | 2,215 | (15,877 | ) | ||||
Net cash used in operating activities | (45,785 | ) | (36,628 | ) | |||
Cash flows from investing activities: | |||||||
Investment in joint ventures | — | (3,423 | ) | ||||
Capital expenditures | (29,752 | ) | (181,103 | ) | |||
Other investing activities | 493 | (90 | ) | ||||
Net cash used in investing activities | (29,259 | ) | (184,616 | ) | |||
Cash flows from financing activities: | |||||||
Repayments of debt | (489 | ) | (11,108 | ) | |||
Net proceeds from sale of common stock | — | 248,147 | |||||
Issuance of 5.50% Convertible Notes | — | 165,600 | |||||
Payments of preferred dividends | (2,846 | ) | (2,846 | ) | |||
Dividend paid to noncontrolling interests | (435 | ) | (1,286 | ) | |||
Other financing activities | 1,323 | (79 | ) | ||||
Net cash (used in) provided by financing activities | (2,447 | ) | 398,428 | ||||
Effect of exchange rate changes on cash | (776 | ) | (140 | ) | |||
Net change in cash and cash equivalents | (78,267 | ) | 177,044 | ||||
Cash and cash equivalents at beginning of the period | 314,317 | 227,790 | |||||
Cash and cash equivalents at end of period | $ | 236,050 | $ | 404,834 |
Three months ended March 31, 2014 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
External | $ | 3,111 | $ | 40,271 | $ | 54,720 | $ | 20,424 | $ | — | $ | 118,526 | |||||||||||||||
Inter-segment | 12,453 | 6,285 | 1,218 | — | (19,956 | ) | — | ||||||||||||||||||||
Total revenues | $ | 15,564 | $ | 46,556 | $ | 55,938 | $ | 20,424 | $ | (19,956 | ) | $ | 118,526 | ||||||||||||||
OIBDA | $ | (36,445 | ) | $ | 3,299 | $ | 13,676 | $ | (70 | ) | |||||||||||||||||
Depreciation, amortization and accretion | (13,091 | ) | (3,872 | ) | (4,237 | ) | (2,093 | ) | |||||||||||||||||||
Operating (loss) income | $ | (49,536 | ) | $ | (573 | ) | $ | 9,439 | $ | (2,163 | ) | $ | (7,109 | ) | $ | (1,075 | ) | $ | (51,017 | ) | |||||||
Other income | 474 | ||||||||||||||||||||||||||
Interest expense, net of capitalized interest | (35,639 | ) | |||||||||||||||||||||||||
Loss before income taxes and equity earnings | $ | (86,182 | ) |
Three months ended December 31, 2013 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
External | $ | 3,386 | $ | 46,635 | $ | 59,296 | $ | 14,497 | $ | — | $ | 123,814 | |||||||||||||||
Inter-segment | 7,872 | 8,780 | — | — | (16,652 | ) | — | ||||||||||||||||||||
Total revenues | $ | 11,258 | $ | 55,415 | $ | 59,296 | $ | 14,497 | $ | (16,652 | ) | $ | 123,814 | ||||||||||||||
OIBDA | $ | (72,865 | ) | $ | (62,343 | ) | $ | 2,076 | $ | (16,686 | ) | ||||||||||||||||
Depreciation, amortization and accretion | (14,782 | ) | (5,667 | ) | (7,452 | ) | (2,250 | ) | |||||||||||||||||||
Operating loss | $ | (87,647 | ) | $ | (68,010 | ) | $ | (5,376 | ) | $ | (18,936 | ) | $ | (13,805 | ) | $ | 148 | $ | (193,626 | ) | |||||||
Other expense | (11,326 | ) | |||||||||||||||||||||||||
Interest expense, net of capitalized interest | (24,877 | ) | |||||||||||||||||||||||||
Loss before income taxes and equity earnings | $ | (229,829 | ) |
Three months ended March 31, 2013 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
External | $ | 14,658 | $ | 49,600 | $ | 54,678 | $ | 26,462 | $ | — | $ | 145,398 | |||||||||||||||
Inter-segment | 2,645 | 14,610 | — | — | (17,255 | ) | — | ||||||||||||||||||||
Total revenues | $ | 17,303 | $ | 64,210 | $ | 54,678 | $ | 26,462 | $ | (17,255 | ) | $ | 145,398 | ||||||||||||||
OIBDA | $ | (31,073 | ) | $ | 2,231 | $ | 12,243 | $ | 5,553 | ||||||||||||||||||
Depreciation, amortization and accretion | (9,053 | ) | (5,537 | ) | (5,480 | ) | (2,253 | ) | |||||||||||||||||||
Operating (loss) income | $ | (40,126 | ) | $ | (3,306 | ) | $ | 6,763 | $ | 3,300 | $ | (11,564 | ) | $ | (538 | ) | $ | (45,471 | ) | ||||||||
Other expense | (451 | ) | |||||||||||||||||||||||||
Interest expense, net of capitalized interest | (11,649 | ) | |||||||||||||||||||||||||
Loss before income taxes and equity earnings | $ | (57,571 | ) |
(a) | Includes business development costs, personnel costs, stock-based compensation, accounting and legal fees, occupancy expense, information technology costs and interest expense. |
(b) | Consist of inter-segment sales and gross profits elimination as well as eliminations of lower of cost or market adjustments related to inter-segment inventory. |
First Quarter | Fourth Quarter | First Quarter | |||||||||
Revenues (in thousands) | 2014 | 2013 | 2013 | ||||||||
Resources (1) | $ | 15,564 | $ | 11,258 | $ | 17,303 | |||||
Chemicals and Oxides (2) | 46,556 | 55,415 | 64,210 | ||||||||
Magnetic Materials and Alloys (3) | 55,938 | 59,296 | 54,678 | ||||||||
Rare Metals (4) | 20,424 | 14,497 | 26,462 | ||||||||
Inter-segment eliminations | (19,956 | ) | (16,652 | ) | (17,255 | ) | |||||
Total Net Revenues | $ | 118,526 | $ | 123,814 | $ | 145,398 | |||||
Volumes (in metric tons) | |||||||||||
Resources | 988 | 1,034 | 763 | ||||||||
Chemicals and Oxides | 1,926 | 1,760 | 1,866 | ||||||||
Magnetic Materials and Alloys | 1,374 | 1,353 | 1,263 | ||||||||
Rare Metals | 101 | 58 | 81 | ||||||||
Inter-segment eliminations | (871 | ) | (1,004 | ) | (699 | ) | |||||
ASP per kilogram | |||||||||||
Resources | $ | 15.75 | $ | 10.89 | $ | 22.68 | |||||
Chemicals and Oxides | $ | 24.17 | $ | 31.48 | $ | 34.41 | |||||
Magnetic Materials and Alloys | $ | 40.71 | $ | 43.82 | $ | 43.29 | |||||
Rare Metals | $ | 202.21 | $ | 249.93 | $ | 326.69 | |||||
1. The Resources segment includes operations at our Molycorp Mountain Pass facility where we conduct rare earth minerals extraction and processing to produce: purified unseparated light rare earth concentrates, or LREC; separated rare earth oxides, including lanthanum, cerium and neodymium/praseodymium; heavy rare earth concentrates, which include samarium, europium, gadolinium, terbium, dysprosium and others; and a line of proprietary rare earth-based water treatment products, including SorbX® and PhosFIX™. | |||||||||||
2. The Chemicals and Oxides division includes: production of rare earths at our operations at Molycorp Silmet; separated heavy rare earth oxides and other custom engineered materials from our facilities in Jiangyin, Jiangsu Province, China; and production of rare earths, salts of REEs, zirconium-based engineered materials and mixed rare earth/zirconium oxides from our facilities in Zibo, Shandong Province, China. Rare earths and zirconium applications from products made in this segment include catalytic converters, computers, television display panels, optical lenses, mobile phones, electronic chips, and many others. | |||||||||||
3. The Magnetic Materials and Alloys segment includes the production of Neo Powders™ through our wholly-owned manufacturing facilities in Tianjin, China, and Korat, Thailand, under the Molycorp Magnequench brand. This operating segment also includes manufacturing of neodymium and samarium magnet alloys, other specialty alloy products and rare earth metals at our MMA facility in Tolleson, Arizona. Neo Powders™ are used in the production of high performance, bonded NdFeB permanent magnets, which are found in micro-motors, precision motors, sensors, and other applications requiring high levels of magnetic strength, flexibility, small size, reduced weight, and energy efficient performance. | |||||||||||
4. The Rare Metals segment produces, reclaims, refines and markets high value niche metals and their compounds that include gallium, indium, rhenium, tantalum, and niobium. Operations in this segment are distributed in several locations: Quapaw, Oklahoma; Blanding, Utah; Peterborough, Ontario, Canada; Sagard, Germany; Stade, Germany; Hyeongok Industrial Zone in South Korea; and Sillamäe, Estonia. Applications from products made in this segment include wireless technologies, LEDs, flat panel displays, turbines, solar power catalysts, steel additives, electronics applications, and many others. |
Adjusted Net Loss | |||||||||||
First Quarter | Fourth Quarter | First Quarter | |||||||||
2014 | 2013 | 2013 | |||||||||
Net loss attributable to Molycorp stockholders | $ | (86,061 | ) | $ | (194,308 | ) | $ | (38,971 | ) | ||
Certain non-cash and other items: | |||||||||||
Stock-based compensation | 822 | 2,993 | (325 | ) | |||||||
Inventory write-downs | 15,693 | 16,816 | 19,205 | ||||||||
Impact of purchase accounting on cost of inventory sold | 577 | (1,376 | ) | 2,497 | |||||||
Impairment of goodwill, long-lived asset and intangibles | — | 119,717 | — | ||||||||
Investment write-downs | — | 9,414 | — | ||||||||
Out-of-ordinary items: | |||||||||||
Water removal | 8,102 | 5,385 | 3,734 | ||||||||
Income tax effect of above adjustments | (160 | ) | (15,065 | ) | (9,793 | ) | |||||
Adjusted net loss | (61,027 | ) | (56,424 | ) | (23,653 | ) | |||||
Dividends on Convertible Preferred Stock | (2,846 | ) | (2,846 | ) | (2,846 | ) | |||||
Adjusted net loss attributed to common stockholders | $ | (63,873 | ) | $ | (59,270 | ) | $ | (26,499 | ) | ||
Weighted average common shares outstanding | 221,374,589 | 208,080,170 | 153,314,081 | ||||||||
Adjusted net loss per share | $ | (0.29 | ) | $ | (0.28 | ) | $ | (0.17 | ) |
OIBDA and Adjusted OIBDA | |||||||||||
First Quarter | Fourth Quarter | First Quarter | |||||||||
Consolidated | 2014 | 2013 | 2013 | ||||||||
Operating loss | $ | (51,017 | ) | $ | (193,626 | ) | $ | (45,471 | ) | ||
Depreciation and amortization included in costs of sales | 16,147 | 18,444 | 14,172 | ||||||||
Depreciation, amortization and accretion | 7,201 | 11,764 | 8,210 | ||||||||
OIBDA | (27,669 | ) | (163,418 | ) | (23,089 | ) | |||||
Adjusted OIBDA by Segment | |||||||||||
Resources | |||||||||||
OIBDA | $ | (36,445 | ) | $ | (72,865 | ) | $ | (31,073 | ) | ||
Stock-based compensation | 234 | 306 | (33 | ) | |||||||
Inventory write-downs | 15,693 | 16,816 | 19,205 | ||||||||
Impairment of goodwill, long-lived asset and intangibles | — | 30,421 | — | ||||||||
Investment write-downs | — | 8,000 | — | ||||||||
Water removal | 8,102 | 5,385 | 3,734 | ||||||||
Adjusted OIBDA - Resources | $ | (12,416 | ) | $ | (11,937 | ) | $ | (8,167 | ) | ||
Chemicals and Oxides | |||||||||||
OIBDA | $ | 3,299 | $ | (62,343 | ) | $ | 2,231 | ||||
Stock-based compensation | 193 | 172 | (19 | ) | |||||||
Impact of purchase accounting on cost of inventory sold | 25 | (1,991 | ) | 2,015 | |||||||
Impairment of goodwill, long-lived asset and intangibles | — | 67,247 | — | ||||||||
Adjusted OIBDA - Chemicals and Oxides | $ | 3,517 | $ | 3,085 | $ | 4,227 | |||||
Magnetic Materials and Alloys | |||||||||||
OIBDA | 13,676 | 2,076 | 12,243 | ||||||||
Stock-based compensation | 144 | 182 | (20 | ) | |||||||
Impact of purchase accounting on cost of inventory sold | (45 | ) | 6 | (63 | ) | ||||||
Impairment of goodwill, long-lived asset and intangibles | — | 10,207 | — | ||||||||
Adjusted OIBDA - Magnetic Materials and Alloys | $ | 13,775 | $ | 12,471 | $ | 12,160 | |||||
Rare Metals | |||||||||||
OIBDA | (70 | ) | (16,686 | ) | 5,553 | ||||||
Stock-based compensation | 22 | 26 | (3 | ) | |||||||
Impact of purchase accounting on cost of inventory sold | 598 | 609 | 545 | ||||||||
Impairment of goodwill, long-lived asset and intangibles | — | 11,842 | — | ||||||||
Investment write-downs | — | 1,414 | — | ||||||||
Adjusted OIBDA - Rare Metals | 550 | (2,795 | ) | 6,095 | |||||||
Corporate and other | (6,823 | ) | (11,441 | ) | (11,756 | ) | |||||
Eliminations | (1,075 | ) | 148 | (538 | ) | ||||||
Adjusted OIBDA - Consolidated | $ | (2,472 | ) | $ | (10,469 | ) | $ | 2,021 |