Investment in Affiliates

6 Months Ended

Jun. 30, 2024

Equity Method Investments and Joint Ventures [Abstract]

Equity income in affiliates represents the Company's ownership share of the LGJV Entities' results, including the effect of the priority distribution payment and amortization of the carrying value of the investment in excess of the underlying net assets of the LGJV Entities. This basis difference of $1,090 at June 30, 2024 ($699 at December 31, 2023) is being amortized as the LGJV Entities' proven and probable reserves are processed.

The table below presents a reconciliation of the Investment in Affiliates at June 30, 2024:


Balance at December 31, 2023		$	321,914
LGJV net income and comprehensive income (70%)	21,461
Basis amortization	(85)
Impact of the priority distribution payment	438
Equity income in affiliates		21,814
Distributions from the LGJV		(38,500)
Balance at June 30, 2024		$	305,228

The table below presents equity income in affiliates recognized in the three and six months ended June 30, 2024 and 2023:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Equity income in affiliates	$	14,526	$	1,474	$	21,814	$	6,485

The table below shows the distributions made to the partners by the LGJV and the Company's share of the distributions made during 2024:


	LGJV		Company's Share
February 15, 2024	$	30,000	$	21,000
April 22, 2024	25,000		17,500
Total	$	55,000	$	38,500

Subsequently, on July 29, 2024, the LGJV made a $40,000 capital distribution to the LGJV partners, of which the Company’s share

was $28,000.

The LGJV combined balance sheets as of June 30, 2024, and December 31, 2023, the combined statements of income for the three and six months ended June 30, 2024 and 2023, and the statement of cash flows for the six months ended June 30, 2024 and 2023, are as follows


(in thousands)	June 30, 2024		December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents	$	45,523	$	34,303
Receivables	12,559		12,634
Inventories	15,782		16,397
VAT receivable	12,781		12,610
Income tax receivable	13,580		20,185
Other current assets	2,652		1,253
Total current assets	102,877		97,382
Non-Current Assets
Mine development, net	231,138		234,980
Property, plant and equipment, net	161,171		171,965
Deferred tax assets	2,783		9,568
Total non-current assets	395,092		416,513
Total Assets	$	497,969	$	513,895
LIABILITIES AND OWNERS’ CAPITAL
Current Liabilities
Accounts payable and accrued liabilities	$	47,293	$	38,704
Related party payable	192		560

Total current liabilities	47,485		39,264
Non-Current Liabilities
Lease liability	172		208
Asset retirement obligation	12,027		11,593
Deferred tax liabilities	3,681		3,885
Total non-current liabilities	15,880		15,686
Owners’ Capital
Capital contributions	400,638		455,638
Paid-in capital	18,186		18,186
Retained earnings (accumulated deficit)	15,780		(14,879)
Total owners’ capital	434,604		458,945
Total Liabilities and Owners’ Capital	$	497,969	$	513,895


	Three Months Ended, June 30,				Six Months Ended, June 30,
(in thousands)	2024		2023		2024		2023
Revenue	$	94,198	$	58,259	$	166,416	$	128,124
Expenses
Cost of sales	31,956		25,821		62,727		51,809
Royalties and duties	713		308		1,043		726
Exploration	1,601		657		2,972		1,120
General and administrative	4,089		4,402		8,374		8,338
Depreciation, depletion and amortization	20,821		22,027		41,077		42,846
Total expenses	59,180		53,215		116,193		104,839
Other expense (income)
Accretion expense	218		296		435		593
Interest expense	554		15		749		141
Interest income	(270)		(555)		(543)		(555)
Other expense	653		43		648		31
Foreign exchange loss (gain)	832		(242)		956		(1,070)
	1,987		(443)		2,245		(860)

Income before taxes	33,031		5,487		47,978		24,145
Income tax expense	12,544		4,741		17,319		10,698
Net income and comprehensive income	$	20,487	$	746	$	30,659	$	13,447


	Six Months Ended June 30,
(in thousands)	2024		2023
Cash flows from operating activities:
Net income and comprehensive income	$	30,659	$	13,447
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	41,077		42,846
Accretion	435		593
Deferred taxes	6,691		5,453
Unrealized loss (gain) on foreign currency rate change	1,016		(55)
Other	—		(7)

Changes in operating assets and liabilities:
VAT receivable	(442)		5,828
Receivables	75		20,910
Inventories	178		(400)

Other current assets	(1,404)		(1,281)
Income tax receivable	4,912		(2,459)
Accounts payable and other accrued liabilities	8,978		(10,884)
Payables to related parties	(367)		374


Net cash provided by operating activities	91,808		74,365

Cash flows from investing activities:
Mine development	(21,071)		(18,597)
Purchase of property, plant and equipment	(4,486)		(8,718)
Materials and supplies inventory	—		1,323
Net cash used by investing activities	(25,557)		(25,992)

Cash flows from financing activities:
Equipment loan and lease payments	(31)		(503)
Capital distributions	(55,000)		—

Net cash used by financing activities	(55,031)		(503)

Net Increase in cash and cash equivalents	11,220		47,870
Cash and cash equivalents, beginning of period	34,303		34,936
Cash and cash equivalents, end of period	$	45,523	$	82,806
Interest paid	$	419	$	132
Interest earned	$	543	$	555