Segment Reporting

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

The operating segments are managed separately because each segment represents a distinct use of company resources and a separate contribution to the Company’s cash flows. The Company’s reportable operating segments include the Palmarejo, San Bartolomé, Martha, Rochester, Kensington and Endeavor mining properties and the La Preciosa exploration property. All operating segments are engaged in the discovery and/or mining of gold and silver and generate the majority of their revenues from the sale of these precious metal concentrates and/or refined precious metals. Through September 2012, the Martha mine sold precious metal concentrates, typically under long-term contracts, to trading partners located in the United States and Switzerland. The Company ceased active mining operations at the Martha mine in September of 2012.

The Kensington mine sells precious metals and concentrates, typically under long-term contracts to smelters in China, Japan, and Germany. Refined gold and silver produced by the Rochester, Palmarejo, and San Bartolomé mines are principally sold on a spot basis to precious metals trading banks such as International Commodities, Mitsui, Mitsubishi, Standard Bank, TD Securities, Valcambi and Auramet. Concentrates produced at the Endeavor mine are sold to Nyrstar (formerly Zinifex), an Australian smelter. The Company’s exploration programs, other than the La Preciosa project, are reported in its other segment. The other segment also includes the corporate headquarters, elimination of intersegment transactions and other items necessary to reconcile to consolidated amounts. The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies above. The Company evaluates performance and allocates resources based on profit or loss before interest, income taxes, depreciation and amortization, unusual and infrequent items and extraordinary items.    

Financial information relating to the Company’s segments is as follows (in thousands):

Three months ended June 30, 2013	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa			Other			Total
Sales of metals	$	86,217		$	49,236		$	30,851		$	34,903		$	(161	)	$	3,479		$	—		$	—		$	204,525
Productions costs applicable to sales	(55,218		)	(32,815		)	(30,154		)	(23,054		)	—			(1,683		)	—			—			(142,924		)
Depreciation and depletion	(35,557		)	(4,941		)	(13,261		)	(2,324		)	(113		)	(1,220		)	(2		)	(235		)	(57,653		)
Gross profit	(4,558		)	11,480			(12,564		)	9,525			(274		)	576			(2		)	(235		)	3,948
Exploration expense	3,189			27			563			512			603			—			690			1,190			6,774
Loss on impairment	—			—			—			—			86			—			—			—			86
Other operating expenses	—			—			134			34,177			861			—			—			12,873			48,045
OPERATING INCOME	(7,747		)	11,453			(13,261		)	(25,164		)	(1,824		)	576			(692		)	(14,298		)	(50,957		)
Interest and other income, net	(428		)	683			150			—			(177		)	—			(11		)	(16,990		)	(16,773		)
Interest expense, net	(4,190		)	(14		)	(95		)	(5		)	(1		)	—			—			(6,625		)	(10,930		)
Fair value adjustments, net	61,066			—			6,350			—			—			—			—			(662		)	66,754
Income tax expense	(17,282		)	(4,506		)	—			—			(117		)	85			—			(1,314		)	(23,134		)
Net income	$	31,419		$	7,616		$	(6,856	)	$	(25,169	)	$	(2,119	)	$	661		$	(703	)	$	(39,889	)	$	(35,040	)
Segment assets (A)	$	1,860,240		$	286,325		$	485,215		$	122,917		$	6,757		$	30,226		$	409,458		$	103,464		$	3,304,602
Capital expenditures (B)	$	9,166		$	3,159		$	7,406		$	6,596		$	10		$	—		$	735		$	129		$	27,201

A. Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

B. Balance represents cash flow amounts 

Three months ended June 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	136,365		$	53,383		$	21,124		$	34,153		$	4,149		$	5,232		$	—		$	254,406
Productions costs applicable to sales	(62,538		)	(22,773		)	(16,106		)	(20,751		)	(7,102		)	(2,553		)	—			(131,823		)
Depreciation and depletion	(42,748		)	(4,070		)	(9,719		)	(2,060		)	(704		)	(1,592		)	(131		)	(61,024		)
Gross profit	31,079			26,540			(4,701		)	11,342			(3,657		)	1,087			(131		)	61,559
Exploration expense	1,624			(70		)	274			1,135			2,763			—			579			6,305
Loss on impairment	—			—			—			—			4,813			—			—
Other operating expenses	—			25			16			692			81			—			8,053			8,867
OPERATING INCOME	29,455			26,585			(4,991		)	9,515			(11,314		)	1,087			(8,763		)	41,574
Interest and other income, net	(4,720		)	631			—			239			(494		)	—			1,123			(3,221		)
Interest expense	(5,672		)	(36		)	(901		)	(7		)	(1		)	—			(940		)	(7,557		)
Fair value adjustments, net	14,105			—			2,187			—			—			—			(253		)	16,039
Income tax benefit (expense)	(11,967		)	(10,889		)	—			—			(28		)	—			(978		)	(23,862		)
Net income	$	21,201		$	16,291		$	(3,705	)	$	9,747		$	(11,837	)	$	1,087		$	(9,811	)	$	22,973
Segment assets (A)	$	1,954,084		$	289,428		$	518,611		$	94,677		$	13,070		$	33,228		$	16,654		$	2,919,752
Capital expenditures (B)	$	11,174		$	7,800		$	9,324		$	2,946		$	529		$	—		$	465		$	32,238

A. Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

B. Balance represents cash flow amounts 

Six months ended June 30, 2013	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa			Other			Total
Sales of metals	$	143,643		$	82,377		$	70,126		$	74,377		$	(662	)	$	6,461					$	—		$	376,322
Productions costs applicable to sales	(81,937		)	(48,494		)	(53,718		)	(44,557		)	—			(3,003		)	—			1			(231,708		)
Depreciation and depletion	(64,507		)	(9,696		)	(26,647		)	(4,505		)	(229		)	(2,044		)	(2		)	(459		)	(108,089		)
Gross profit	(2,801		)	24,187			(10,239		)	25,315			(891		)	1,414			(2		)	(458		)	36,525
Exploration expense	5,170			79			1,235			996			1,587			—			690			3,858			13,615
Loss on impairment	—			—			—			—			205			—			—			—			205
Other operating expenses	—			3,722			210			34,321			1,906			—			—			22,598			62,757
OPERATING INCOME	(7,971		)	20,386			(11,684		)	(10,002		)	(4,589		)	1,414			(692		)	(26,914		)	(40,052		)
Interest and other income, net	1,514			1,288			281			57			746			—			(11		)	(16,827		)	(12,952		)
Interest expense, net	(7,928		)	(46		)	(354		)	(11		)	—			—			—			(12,323		)	(20,662		)
Fair value adjustments, net	75,494			—			10,577			—			—			—			—			(1,521		)	84,550
Income tax expense	(20,816		)	(8,834		)	(1		)	—			(44		)	84			—			(4,043		)	(33,654		)
Net income	$	40,293		$	12,794		$	(1,181	)	$	(9,956	)	$	(3,887	)	$	1,498		$	(703	)	$	(61,628	)	$	(22,770	)
Segment assets (A)	$	1,860,240		$	286,325		$	485,215		$	122,917		$	6,757		$	30,226		$	409,458		$	103,464		$	3,304,602
Capital expenditures (B)	$	14,480		$	3,616		$	10,736		$	9,894		$	10		$	—		$	735		$	557		$	40,028

A. Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

B. Balance represents cash flow amounts 

Six months ended June 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	260,087		$	94,759		$	31,500		$	52,911		$	7,767		$	11,946		$	—		$	458,970
Productions costs applicable to sales	(108,397		)	(36,381		)	(33,197		)	(30,317		)	(10,795		)	(5,290		)	—			(224,377		)
Depreciation and depletion	(80,517		)	(8,289		)	(16,324		)	(3,702		)	(1,300		)	(3,236		)	(248		)	(113,616		)
Gross profit	71,173			50,089			(18,021		)	18,892			(4,328		)	3,420			(248		)	120,977
Exploration expense	2,945			—			496			1,844			6,174			—			1,413			12,872
Loss on impairment	—			—			—			—			4,813			—			—			4,813
Other operating expenses	—			30			35			2,033			279			—			15,154			17,531
OPERATING INCOME	68,228			50,059			(18,552		)	15,015			(15,594		)	3,420			(16,815		)	85,761
Interest and other income, net	(139		)	726			—			288			(570		)	—			1,481			1,786
Interest expense, net	(10,481		)	(36		)	(1,793		)	(15		)	(1		)	—			(1,901		)	(14,227		)
Fair value adjustments, net	(11,505		)	—			1,636			—			—			—			2,795			(7,074		)
Income tax expense	(15,511		)	(18,578		)	—			—			(239		)	—			(4,970		)	(39,298		)
Net income	$	30,592		$	32,171		$	(18,709	)	$	15,288		$	(16,404	)	$	3,420		$	(19,410	)	$	26,948
Segment assets (A)	$	1,954,084		$	289,428		$	518,611		$	94,677		$	13,070		$	33,228		$	16,654		$	2,919,752
Capital expenditures (B)	$	18,344		$	18,007		$	20,202		$	5,585		$	1,188		$	—		$	559		$	63,885

A. Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

B. Balance represents cash flow amounts 

	June 30, 2013		December 31, 2012
Assets
Total assets for reportable segments	$	3,304,602	$	2,974,056
Cash and cash equivalents	249,531		125,440
Short term investments	—		999
Other assets	112,583		120,906
Total consolidated assets	$	3,666,716	$	3,221,401

Geographic Information

	June 30, 2013		December 31, 2012
Long Lived Assets:
United States	$	503,105	$	514,687
Australia	27,364		29,408
Argentina	94,964		95,134
Bolivia	235,781		240,905
Mexico	2,156,808		1,795,677
Total	$	3,018,022	$	2,675,811

	Three months ended June 30,					Six months ended June 30,
	2013			2012		2013			2012
Revenues:
United States	$	65,754		$	55,277	$	144,502		$	84,411
Mexico	86,217			136,365		143,643			260,087
Bolivia	49,236			53,383		82,377			94,759
Australia	3,479			5,232		6,462			11,946
Argentina	(161		)	4,149		(662		)	7,767
Total	$	204,525		$	254,406	$	376,322		$	458,970