Segment Reporting

9 Months Ended

Sep. 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 a gold concentrate, typically under long-term contracts to smelters in China and Japan. 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 Bank Group, 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 September 30, 2013	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa			Other			Total
Sales of metals	$	104,524		$	28,819		$	38,927		$	24,259		$	—		$	4,296		$	—		$	—		$	200,825
Production costs applicable to sales	(66,839		)	(17,673		)	(27,484		)	(17,861		)	—			(1,871		)	—			—			(131,728		)
Depreciation and depletion	(33,654		)	(4,909		)	(18,190		)	(2,860		)	(108		)	(894		)	(11		)	(248		)	(60,874		)
Gross profit	4,031			6,237			(6,747		)	3,538			(108		)	1,531			(11		)	(248		)	8,223
Exploration expense	860			(3		)	1,496			624			282			—			(671		)	717			3,305
Other operating expenses	—			1,969			(6		)	173			738			—			1,888			15,433			20,195
OPERATING INCOME / LOSS	3,171			4,271			(8,237		)	2,741			(1,128		)	1,531			(1,228		)	(16,398		)	(15,277		)
Interest and other income, net	(2,281		)	582			—			60			(595		)	—			19			(446		)	(2,661		)
Interest expense, net	(2,925		)	(12		)	(51		)	(5		)	—			—			—			(6,669		)	(9,662		)
Fair value adjustments, net	(15,260		)	—			(2,952		)	(2,363		)	—			—			—			(71		)	(20,646		)
Income tax expense	1,564			(4,648		)	—			—			5			—			—			5,060			1,981
Net income (loss)	$	(15,731	)	$	193		$	(11,240	)	$	433		$	(1,718	)	$	1,531		$	(1,209	)	$	(18,524	)	$	(46,265	)
Segment assets (A)	$	1,825,599		$	289,274		$	481,613		$	161,993		$	6,146		$	27,938		$	410,085		$	109,520		$	3,312,168
Capital expenditures (B)	$	10,290		$	4,166		$	4,934		$	12,267		$	—		$	—		$	358		$	711		$	32,726

Three months ended September 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa		Other			Total
Sales of metals	$	102,642		$	46,192		$	36,450		$	36,244		$	4,933		$	4,132		$	—	$	—		$	230,593
Production costs applicable to sales	(48,672		)	(19,937		)	(26,881		)	(21,014		)	(6,481		)	(1,982		)	—		—			(124,967		)
Depreciation and depletion	(34,007		)	(4,163		)	(11,512		)	(2,061		)	(32		)	(898		)	—		(171		)	(52,844		)
Gross profit	19,963			22,092			(1,943		)	13,169			(1,580		)	1,252			—		(171		)	52,782
Exploration expense	2,288			50			1,476			1,158			1,217			—			—		768			6,957
Loss on impairment	—			—			—			—			1,293			—			—		—			1,293
Other operating expenses	—			50			39			1,109			133			—			—		9,212			10,543
OPERATING INCOME / LOSS	17,675			21,992			(3,458		)	10,902			(4,223		)	1,252			—		(10,151		)	33,989
Interest and other income, net	4,914			8,353			—			59			(342		)	—			—		(320		)	12,664
Interest expense	(4,401		)	(11		)	(1,834		)	(6		)	(2		)	—			—		(1,097		)	(7,351		)
Fair value adjustments, net	(34,266		)	—			(4,283		)	—			—			—			—		901			(37,648		)
Income tax benefit (expense)	5,495			(23,106		)	—			—			1,233			(202		)	—		(895		)	(17,475		)
Net income (loss)	$	(10,583	)	$	7,228		$	(9,575	)	$	10,955		$	(3,334	)	$	1,050		$	—	$	(11,562	)	$	(15,821	)
Segment assets (A)	$	1,926,695		$	299,041		$	520,619		$	104,066		$	11,339		$	32,619		$	—	$	18,613		$	2,912,992
Capital expenditures (B)	$	11,321		$	4,406		$	9,034		$	4,777		$	6		$	—		$	—	$	428		$	29,972

Nine months ended September 30, 2013	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa			Other			Total
Sales of metals	$	248,167		$	111,196		$	109,053		$	98,636		$	(662	)	$	10,757		$	—		$	—		$	577,147
Production costs applicable to sales	(148,776		)	(66,165		)	(81,203		)	(62,418		)	—			(4,874		)	—			(1		)	(363,437		)
Depreciation and depletion	(98,161		)	(14,606		)	(44,837		)	(7,365		)	(338		)	(2,938		)	(12		)	(706		)	(168,963		)
Gross profit	1,230			30,425			(16,987		)	28,853			(1,000		)	2,945			(12		)	(707		)	44,747
Exploration expense	6,029			76			2,732			1,621			4,460			—			19			1,983			16,920
Loss on impairment	—			—			—			—			205			—			—			—			205
Other operating expenses	—			5,691			204			34,494			2,643			—			1,888			38,032			82,952
OPERATING INCOME / LOSS	(4,799		)	24,658			(19,923		)	(7,262		)	(8,308		)	2,945			(1,919		)	(40,722		)	(55,330		)
Interest and other income, net	(768		)	1,871			281			117			166			—			8			(17,288		)	(15,613		)
Interest expense, net	(10,853		)	(59		)	(405		)	(16		)	—			—			—			(18,991		)	(30,324		)
Fair value adjustments, net	60,234			—			7,626			(2,363		)	—			—			—			(1,592		)	63,905
Income tax expense	(17,383		)	(13,482		)	(1		)	—			(38		)	—			—			(769		)	(31,673		)
Net income (loss)	$	26,431		$	12,988		$	(12,422	)	$	(9,524	)	$	(8,180	)	$	2,945		$	(1,911	)	$	(79,362	)	$	(69,035	)
Segment assets (A)	$	1,825,599		$	289,274		$	481,613		$	161,993		$	6,146		$	27,938		$	410,085		$	109,520		$	3,312,168
Capital expenditures (B)	$	24,770		$	7,782		$	15,670		$	22,161		$	10		$	—		$	1,093		$	1,268		$	72,754

Nine months ended September 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			La Preciosa		Other			Total
Sales of metals	$	362,729		$	140,951		$	67,950		$	89,156		$	12,700		$	16,077		$	—	$	—		$	689,563
Production costs applicable to sales	(157,070		)	(56,317		)	(60,078		)	(51,331		)	(17,276		)	(7,272		)	—		—			(349,344		)
Depreciation and depletion	(114,525		)	(12,452		)	(27,836		)	(5,763		)	(1,332		)	(4,134		)	—		(418		)	(166,460		)
Gross profit	91,134			72,182			(19,964		)	32,062			(5,908		)	4,671			—		(418		)	173,759
Exploration expense	5,232			51			1,971			3,003			7,391			—			—		2,181			19,829
Loss on impairment	—			—			—			—			6,106			—			—		—			6,106
Other operating expenses	—			80			75			3,142			411			—			—		24,366			28,074
OPERATING INCOME / LOSS	85,902			72,051			(22,010		)	25,917			(19,816		)	4,671			—		(26,965		)	119,750
Interest and other income, net	4,774			9,079			1			347			(912		)	—			—		1,161			14,450
Interest expense, net	(14,883		)	(47		)	(3,627		)	(21		)	(3		)	—			—		(2,997		)	(21,578		)
Fair value adjustments, net	(45,771		)	—			(2,647		)	—			—			—			—		3,696			(44,722		)
Income tax expense	(10,015		)	(41,684		)	—			—			993			(202		)	—		(5,865		)	(56,773		)
Net income (loss)	$	20,007		$	39,399		$	(28,283	)	$	26,243		$	(19,738	)	$	4,469		$	—	$	(30,970	)	$	11,127
Segment assets (A)	$	1,926,695		$	299,041		$	520,619		$	104,066		$	11,339		$	32,619		$	—	$	18,613		$	2,912,992
Capital expenditures (B)	$	29,665		$	22,413		$	29,235		$	10,362		$	1,194		$	—		$	—	$	988		$	93,857

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

(B) Capital expenditures are presented on a cash basis

	September 30, 2013		December 31, 2012
Assets
Total assets for reportable segments	$	3,312,168	$	2,974,056
Cash and cash equivalents	211,434		125,440
Short term investments	—		999
Other assets	113,315		120,906
Total consolidated assets	$	3,636,917	$	3,221,401

Geographic Information

	September 30, 2013		December 31, 2012
Long Lived Assets:
United States	$	525,573	$	514,687
Australia	26,469		29,408
Argentina	94,844		95,134
Bolivia	235,059		240,905
Mexico	2,133,645		1,795,677
Total	$	3,015,590	$	2,675,811

	Three months ended September 30,				Nine months ended September 30,
	2013		2012		2013			2012
Revenues:
United States	$	63,186	$	72,694	$	207,689		$	157,106
Mexico	104,524		102,642		248,167			362,729
Bolivia	28,819		46,192		111,196			140,951
Australia	4,296		4,132		10,757			16,077
Argentina	—		4,933		(662		)	12,700
Total	$	200,825	$	230,593	$	577,147		$	689,563