EX-99.1 2 a4q16earningsreleaseex-991.htm EXHIBIT 99.1 Exhibit


NEWS RELEASE             image0a15.jpg
Coeur Reports Fourth Quarter and Full-Year 2016 Results
Chicago, Illinois - February 8, 2017 - Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE:CDE) today reported 2016 financial results, posting net income of $55.4 million, or $0.34 per share, and cash flow from operating activities of $125.8 million, an increase of $12.3 million, or 11%, over 2015. Adjusted EBITDA1 for the year was $215.2 million, increasing nearly $90 million, or 68%, year-over-year. Over the course of 2016, the Company also meaningfully strengthened its balance sheet, ending the year with total outstanding debt of $210.9 million, a 57% reduction compared to a year ago, net debt1 of $48.7 million, and a year-end cash balance of $162.2 million.
In the fourth quarter, the Company generated a net loss of $8.3 million, or $0.03 per share, due mostly to lower metal prices and a one-time loss of $11.3 million related to the redemption of $190 million in principal of the Company's 7.875% Senior Notes due 2021. Quarterly cash flow from operating activities was $25.5 million and adjusted EBITDA1 was $44.0 million.
Highlights
•
As announced on January 5, 2017, Coeur achieved record production of 3.9 million ounces of silver and 102,500 ounces of gold, or 10.0 million silver equivalent ounces (AgEqOz)1, for the fourth quarter and 14.8 million ounces of silver and 358,170 ounces of gold, or 36.3 million AgEqOz1 for the full year
•
For Coeur's primary silver operations, CAS and adjusted CAS per average spot AgEqOz1 were $11.42 and $11.34, respectively, for the fourth quarter and $11.12 and $10.99 for the full year. The full-year figures represented 10% and 7% year-over-year declines, respectively
•
For Coeur's primary gold operations, fourth quarter CAS and adjusted CAS per gold equivalent ounce (AuEqOz)1 were $675 and $676, respectively. Relative to 2015, full-year CAS and adjusted CAS per AuEqOz1 declined 8% and 10%, respectively, to $705 and $688
•
Companywide AISC and adjusted AISC per average spot AgEqOz1 were $14.56 and $14.52, respectively, for the quarter and $14.27 and $14.09 for the full year. Full-year figures both represent year-over-year decreases of 2%. On a 60:1 equivalence basis, companywide AISC and adjusted AISC per AgEqOz1 were $16.08 and $15.88, respectively, both within the Company guidance range of $15.75 - $16.25
•
General and administrative expenses were $29.4 million, within Company guidance and representing a year-over-year decrease of 10%
•
Capital expenditures for the quarter were $29.9 million, driven by the ramp-up of Palmarejo underground operations at Guadalupe and Independencia, construction of the Stage IV leach pad expansion at Rochester, and continued development of the Jualin decline at Kensington. Full-year capital expenditures were $101.0 million, below Company guidance of $105 - $115 million
•
Total debt decreased $279.5 million, or 57%, year-over-year. Together with rising adjusted EBITDA1, the Company's total debt to last twelve month (LTM) adjusted EBITDA1 declined to 1.0x, down from 3.8x a year ago and 5.5x fifteen months ago
•
In 2016, Coeur monetized several non-core assets for a total consideration of $23.8 million, consistent with its strategy of redeploying capital to higher-return opportunities. This focus has continued into the new year, with the pending Joaquin Project sale announced in January 2017 for total consideration of $25 million plus a 2% NSR


1


"2016 marked a key inflection point for Coeur. Our silver equivalent production set a new Company record, operating and non-operating costs continued to decline, adjusted EBITDA increased materially, and we achieved strong earnings for the year. In addition, we delivered on our commitment to strengthen our balance sheet by reducing total debt by $280 million,” said Mitchell J. Krebs, Coeur's President and Chief Executive Officer.

“Coeur has entered 2017 well-positioned to continue delivering high-quality growth through ongoing initiatives at our Palmarejo, Kensington, and Rochester operations. In addition, our exploration programs targeting near-mine additions to reserves and resources have been accelerated and are expected to further enhance and extend the economics of our existing operations. Our team has done a terrific job executing our strategic plan and striving to establish a higher standard in all areas of the business.”



2


Financial and Operating Highlights (Unaudited)
(Amounts in millions, except per share amounts, gold ounces produced & sold, and per-ounce metrics)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Revenue
$
665.8

$
159.2

$
176.2

$
182.0

$
148.4

$
646.1

$
164.2

Costs Applicable to Sales
$
409.5

$
102.0

$
105.4

$
100.5

$
101.6

$
479.7

$
125.3

General and Administrative Expenses
$
29.4

$
6.6

$
7.1

$
7.4

$
8.3

$
32.8

$
8.8

Net Income (Loss)
$
55.4

$
(8.3
)
$
69.6

$
14.5

$
(20.4
)
$
(367.2
)
$
(303.0
)
Net Income (Loss) Per Share
$
0.34

$
(0.03
)
$
0.42

$
0.09

$
(0.14
)
$
(2.83
)
$
(2.28
)
Adjusted Net Income (Loss)1
$
47.8

$
2.8

$
38.6

$
16.9

$
(10.5
)
$
(103.6
)
$
(44.0
)
Adjusted Net Income (Loss)1 Per Share
$
0.29

$
0.01

$
0.23

$
0.11

$
(0.06
)
$
(0.80
)
$
(0.31
)
Weighted Average Shares
163.5

178.6

161.0

157.9

150.2

129.6

145.0

EBITDA1
$
161.2

$
27.4

$
50.9

$
62.1

$
20.8

$
(204.0
)
$
(272.9
)
Adjusted EBITDA1
$
215.2

$
44.0

$
62.7

$
72.0

$
37.4

$
127.9

$
32.9

Cash Flow from Operating Activities
$
125.8

$
25.5

$
47.8

$
45.9

$
6.6

$
113.5

$
43.2

Capital Expenditures
$
101.0

$
29.9

$
25.6

$
23.3

$
22.2

$
95.2

$
30.0

Free Cash Flow1
$
(2.4
)
$
(4.5
)
$
14.6

$
12.2

$
(24.7
)
$
(20.9
)
$
4.2

Cash, Equivalents & Short-Term Investments
$
162.2

$
162.2

$
222.5

$
257.6

$
173.4

$
200.7

$
200.7

Total Debt2
$
210.9

$
210.9

$
401.7

$
511.1

$
511.1

$
490.4

$
490.4

Average Realized Price Per Ounce – Silver
$
17.18

$
16.64

$
19.61

$
17.38

$
15.16

$
15.46

$
14.27

Average Realized Price Per Ounce – Gold
$
1,230

$
1,170

$
1,317

$
1,255

$
1,178

$
1,143

$
1,093

Silver Ounces Produced
14.8

3.9

3.5

4.0

3.4

15.9

4.0

Gold Ounces Produced
358,170

102,500

84,871

92,727

78,072

327,908

91,551

Silver Equivalent Ounces Produced1
36.3

10.0

8.6

9.6

8.1

35.6

9.5

Silver Ounces Sold
14.3

3.4

3.4

4.0

3.5

16.5

4.4

Gold Ounces Sold
338,131

87,108

83,389

88,543

79,091

335,882

92,032

Silver Equivalent Ounces Sold1
34.6

8.6

8.4

9.3

8.3

36.7

9.9

Silver Equivalent Ounces Sold (Average Spot)1
39.0

9.6

9.1

10.6

9.8

41.4

11.3

Adjusted CAS per AgEqOz1
$
11.73

$
12.05

$
12.10

$
10.71

$
12.05

$
12.75

$
12.65

Adjusted CAS per Average Spot AgEqOz1
$
10.99

$
11.34

$
11.64

$
9.90

$
11.00

$
11.87

$
11.79

Adjusted CAS per AuEqOz1
$
688

$
676

$
712

$
644

$
721

$
764

$
663

Adjusted AISC per AgEqOz1
$
15.88

$
16.13

$
16.46

$
14.82

$
16.05

$
16.16

$
15.66

Adjusted AISC per Average Spot AgEqOz1
$
14.09

$
14.52

$
15.23

$
12.95

$
13.51

$
14.32

$
13.73



Financial Results
During the quarter, the Company realized average silver and gold prices of $16.64 and $1,170 per ounce, representing quarter-over-quarter decreases of 15% and 11%, respectively. Importantly, the average realized gold price in the fourth quarter reflected the impact of the new gold stream agreement with Franco-Nevada, which provides for a payment of $800 per ounce delivered. For the full year, average realized silver and gold prices were $17.18 and $1,230, 11% and 8% higher, respectively, year-over-year.
Fourth quarter revenue was $159.2 million, a decrease of 10% quarter-over-quarter, driven by lower metal prices. Silver metal sales contributed 33% and gold 67%. For the full year, revenue increased 3% to $665.8 million, with silver metal sales contributing 37% and gold 63%.
Costs applicable to sales were $102.0 million for the fourth quarter. Full-year costs applicable to sales were $409.5 million, representing a year-over-year decrease of 15%, primarily driven by lower unit costs. Other


3


contributing factors include increased operating efficiencies, lower input costs, and more favorable currency exchange rates.
Free cash flow1 for the quarter was negatively impacted by an increase in inventory at Palmarejo as well as the acceleration of cash interest paid in connection with the redemption of $190 million in principal of the Company's 7.875% Senior Notes due 2021. The increase in inventory at Palmarejo resulted from the timing of a quarter-end shipment and gold retained for purchase by Franco-Nevada in January 2017.
Fourth quarter expensed exploration was $5.3 million, bringing full-year expensed exploration to $12.9 million, representing a year-over-year increase of 11% due to expanded exploration drilling activities at Palmarejo, Kensington, and Rochester.
Net income in 2016 was $55.4 million, or $0.34 per share. This compares to a net loss of $367.2 million, or $2.83 per share in 2015, which included after-tax, non-cash impairment charges of $313.3 million. Adjusted net income1 in 2016 was $47.8 million, or $0.29 per share, a significant improvement over the adjusted net loss1 in 2015 of $103.6 million, or $0.80 per share.



4


Operations
Highlights of fourth quarter and full-year 2016 results for each of the Company's operating segments are provided below.
Palmarejo, Mexico
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Underground Operations:
 
 
 
 
 
 
 
   Tons mined
1,047,000
293,706
253,681
283,971
215,642
701,662
189,383
   Average silver grade (oz/t)
4.69
5.00
3.96
5.40
4.21
4.06
3.96
   Average gold grade (oz/t)
0.08
0.09
0.08
0.08
0.07
0.08
0.06
Surface Operations:
 
 
 
 
 
 
 
   Tons mined
36,906
—
—
1,695
35,211
888,432
102,018
   Average silver grade (oz/t)
4.34
—
—
7.77
4.18
3.64
3.86
   Average gold grade (oz/t)
0.04
—
—
0.07
0.04
0.03
0.03
Processing:
 
 
 
 
 
 
 
   Total tons milled
1,078,888
287,569
274,644
270,142
246,533
1,616,668
301,274
   Average recovery rate – Ag
88.4%
89.1%
85.5%
89.5%
89.1%
84.3%
95.4%
   Average recovery rate – Au
86.5%
90.4%
77.7%
86.4%
92.1%
80.6%
88.8%
Silver ounces produced (000's)
4,442
1,269
933
1,307
933
5,149
1,126
Gold ounces produced
73,913
23,906
16,608
18,731
14,668
70,922
14,326
Silver equivalent ounces produced1 (000's)
8,877
2,703
1,930
2,431
1,813
9,404
1,985
Silver ounces sold (000's)
3,993
937
778
1,350
928
5,448
1,465
Gold ounces sold
59,081
15,558
11,410
19,214
12,899
73,218
18,719
Silver equivalent ounces sold1 (000's)
7,538
1,872
1,462
2,502
1,702
9,841
2,588
Silver equivalent ounces sold1 (average spot) (000's)
8,305
2,042
1,555
2,792
1,955
10,865
2,867
Metal sales
$141.3
$32.5
$30.7
$48.3
$29.8
$169.1
$41.6
Costs applicable to sales
$80.8
$20.9
$16.0
$22.9
$21.0
$138.5
$39.8
Adjusted CAS per AgEqOz1
$10.55
$11.01
$10.70
$9.02
$11.54
$13.03
$13.48
Adjusted CAS per average spot AgEqOz1
$9.57
$10.11
$10.05
$8.09
$10.03
$11.80
$12.15
Exploration expense
$5.1
$2.4
$1.3
$0.6
$0.8
$4.5
$0.5
Cash flow from operating activities
$26.7
$(1.7)
$13.7
$11.3
$3.4
$52.7
$20.3
Sustaining capital expenditures
$22.7
$3.9
$6.7
$5.5
$6.6
$5.5
$(1.4)
Development capital expenditures
$13.1
$4.2
$3.3
$3.4
$2.2
$30.5
$7.0
Total capital expenditures
$35.8
$8.1
$10.0
$8.9
$8.8
$36.0
$5.6
Free cash flow (before royalties)
$(9.1)
$(9.8)
$3.7
$2.4
$(5.4)
$16.7
$14.7
Gold production royalty payments
$27.2
$—
$7.6
$10.5
$9.1
$39.2
$9.0
Free cash flow1
$(36.3)
$(9.8)
$(3.9)
$(8.1)
$(14.5)
$(22.5)
$5.7
•
In 2016, legacy open pit and underground operations at Palmarejo were completed while underground operations at Guadalupe and Independencia steadily accelerated, reaching a mining rate of approximately 2,400 and 1,000 tons per day, respectively, as of year-end. The Company is targeting a combined mining rate of 4,500 tons per day by year-end 2017
•
Silver equivalent1 production increased 40% quarter-over-quarter to 2.7 million ounces as a result of higher mining rates and improved recovery rates. As expected, full-year silver equivalent1 production declined 6% to 8.9 million as the mine transitioned from legacy Palmarejo operations to higher-grade underground operations at Guadalupe and Independencia


5


•
Fourth quarter adjusted CAS per average spot AgEqOz1 was $10.11 while full-year adjusted CAS per average spot AgEqOz1 was $9.57, representing a year-over-year decrease of 19% as a result of higher grade production, lower input costs, and a more favorable exchange rate
•
Exploration expense increased in the second half of the year as drilling efforts to extend mine life accelerated
•
In July 2016, the 400,000 ounce minimum royalty obligation with Franco-Nevada under the original agreement was satisfied and the new, more favorable gold stream agreement became effective. The first sale under the new stream agreement occurred in the fourth quarter at a gold price of $800 per ounce
•
In 2017, Palmarejo is expected to produce 6.5 - 7.0 million ounces of silver and 110,000 - 120,000 ounces of gold, or 13.1 - 14.2 million silver equivalent1 ounces at CAS per AgEqOz1 of $10.00 - $10.50. Using a 69:1 spot silver to gold ratio, Palmarejo's 2017 CAS per spot AgEqOz1 is expected to be $9.25 - $9.75
•
Capital expenditures are expected to increase to $40 - $45 million in 2017 as a result of the ongoing transition to underground mining operations at Guadalupe and Independencia

Rochester, Nevada
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Ore tons placed
19,555,998
3,878,487
4,901,039
6,402,013
4,374,459
16,414,302
4,411,590
Average silver grade (oz/t)
0.57
0.57
0.54
0.54
0.64
0.63
0.60
Average gold grade (oz/t)
0.003
0.002
0.003
0.003
0.004
0.003
0.003
Silver ounces produced (000's)
4,564
1,277
1,161
1,197
929
4,631
1,107
Gold ounces produced
50,751
14,231
12,120
13,940
10,460
52,588
11,564
Silver equivalent ounces produced1 (000's)
7,609
2,131
1,888
2,033
1,557
7,786
1,800
Silver ounces sold (000's)
4,584
1,205
1,163
1,137
1,079
4,900
1,125
Gold ounces sold
49,320
12,988
11,751
12,909
11,672
57,963
11,587
Silver equivalent ounces sold1 (000's)
7,543
1,984
1,868
1,912
1,779
8,378
1,821
Silver equivalent ounces sold1 (average spot) (000's)
8,183
2,128
1,963
2,106
2,009
9,188
1,993
Metal sales
$139.9
$36.2
$37.9
$35.8
$30.0
$143.9
$29.0
Costs applicable to sales
$89.7
$23.7
$21.8
$21.7
$22.5
$104.0
$22.8
Adjusted CAS per AgEqOz1
$11.86
$11.99
$11.56
$11.30
$12.61
$12.36
$12.37
Adjusted CAS per average spot AgEqOz1
$10.93
$11.16
$11.02
$10.24
$11.17
$11.28
$11.32
Exploration expense
$0.8
$0.4
$0.1
$0.2
$0.1
$1.3
$0.1
Cash flow from operating activities
$28.4
$7.6
$9.5
$9.2
$2.1
$32.1
$0.4
Sustaining capital expenditures
$7.8
$1.5
$1.2
$2.6
$2.5
$10.3
$5.3
Development capital expenditures
$8.6
$4.3
$2.2
$1.3
$0.8
$15.0
$5.5
Total capital expenditures
$16.4
$5.8
$3.4
$3.9
$3.3
$25.3
$10.8
Free cash flow1
$12.0
$1.8
$6.1
$5.3
$(1.2)
$6.8
$(10.4)
•
Fourth quarter silver equivalent1 production increased 13% quarter-over-quarter to 2.1 million ounces due to improved Stage III leach pad performance resulting from strong ore placement rates throughout 2016. Full-year silver equivalent1 production was 7.6 million ounces
•
Tons placed of 19.6 million in 2016 was approximately 19% higher year-over-year and the highest since Rochester first began operating in 1986
•
Adjusted CAS per average spot AgEqOz1 increased slightly to $11.16 in the fourth quarter and decreased 3% to $10.93 for the full year


6


•
Full-year free cash flow1 was $12.0 million, representing an increase of $5.2 million, or 76%, over 2015. This was primarily driven by increased production, lower unit costs, and lower capital expenditures
•
Construction of the Stage IV leach pad expansion remains on-schedule and on-budget, with commissioning expected in the third quarter of 2017
•
Full-year 2017 production expected to be 4.2 - 4.7 million ounces of silver and 47,000 - 52,000 ounces of gold, or 7.0 - 7.8 million silver equivalent1 ounces at CAS per AgEqOz1 of $11.50 - $12.00. Using a 69:1 spot silver to gold ratio, Rochester's 2017 CAS per spot AgEqOz1 is expected to be $10.75 - $11.25
•
Capital expenditures are expected to increase to $30 - $35 million in 2017 due to continued construction of the Stage IV leach pad expansion

Kensington, Alaska
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Tons milled
620,209
163,410
140,322
157,117
159,360
660,464
159,666
Average gold grade (oz/t)
0.21
0.22
0.20
0.22
0.21
0.20
0.22
Average recovery rate
94.7%
94.4%
94.8%
94.1%
95.8%
94.9%
96.0%
Gold ounces produced
124,331
33,688
26,459
32,210
31,974
126,266
33,713
Gold ounces sold
121,688
28,864
30,998
30,178
31,648
131,553
29,989
Metal sales
$146.6
$34.2
$40.2
$36.5
$35.7
$148.7
$31.7
Costs applicable to sales
$96.7
$23.0
$26.7
$22.6
$24.4
$105.6
$23.7
Adjusted CAS per AuOz1
$790
$801
$859
$740
$761
$798
$777
Exploration expense
$3.5
$1.3
$1.2
$1.0
$—
$2.6
$0.3
Cash flow from operating activities
$50.8
$11.4
$18.0
$7.7
$13.7
$37.7
$4.5
Sustaining capital expenditures
$22.8
$8.9
$5.2
$4.3
$4.4
$14.8
$5.5
Development capital expenditures
$14.0
$3.7
$3.4
$3.2
$3.7
$9.0
$4.0
Total capital expenditures
$36.8
$12.6
$8.6
$7.5
$8.1
$23.8
$9.5
Free cash flow1
$14.0
$(1.2)
$9.4
$0.2
$5.6
$13.9
$(5.0)
•
Fourth quarter gold production was the highest of the year, increasing 27% quarter-over-quarter to 33,688 ounces due to higher tons milled and higher grades. Full-year production was near the high end of the Company's guidance range at 124,331 ounces of gold
•
Fourth quarter adjusted CAS per gold ounce (AuOz)1 decreased 7% quarter-over-quarter to $801 due to higher grades. Full-year adjusted CAS per AuOz1 was within guidance at $790 and represented a 1% decrease year-over-year
•
Despite a year-over-year $13.0 million increase in capital expenditures, free cash flow1 remained flat in 2016 at $14.0 million
•
2017 production is expected to be 120,000 - 125,000 ounces of gold at CAS per AuOz1 of $800 - $850
•
Capital expenditures are expected to increase to over $40 million in 2017 primarily as a result of ongoing development of the Jualin deposit, where production is expected to begin late in the year


7


Wharf, South Dakota
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Ore tons placed
4,268,105
1,178,803
1,199,008
915,631
974,663
3,600,279
1,147,130
Average silver grade (oz/t)
0.28
0.29
0.24
0.28
0.30
0.23
0.21
Average gold grade (oz/t)
0.032
0.027
0.033
0.037
0.031
0.030
0.032
Average plant recovery rate – Au
94.3%
98.9%
94.4%
88.5%
95.9%
89.5%
96.3%
Gold ounces produced
109,175
30,675
29,684
27,846
20,970
78,132
31,947
Silver ounces produced (000's)
105
32
25
35
13
56
18
Gold equivalent ounces produced1
110,927
31,202
30,106
28,433
21,186
79,061
32,231
Silver ounces sold (000's)
95
30
17
33
15
49
17
Gold ounces sold
108,042
29,698
29,230
26,242
22,872
73,148
31,737
Gold equivalent ounces sold1
109,620
30,204
29,508
26,786
23,122
73,965
32,014
Metal sales
$136.7
$35.5
$39.3
$34.0
$27.9
$84.1
$35.7
Costs applicable to sales
$66.4
$16.9
$19.7
$14.3
$15.5
$52.2
$17.8
Adjusted CAS per AuEqOz1
$575
$556
$559
$534
$667
$706
$556
Exploration expense
$—
$—
$—
$—
$—
$0.1
$0.1
Cash flow from operating activities
$62.4
$15.4
$21.1
$16.2
$9.7
$32.0
$18.1
Sustaining capital expenditures
$4.8
$1.3
$0.6
$1.5
$1.4
$3.2
$1.2
Development capital expenditures
$—
$—
$—
$—
$—
$—
$—
Total capital expenditures
$4.8
$1.3
$0.6
$1.5
$1.4
$3.2
$1.2
Free cash flow1
$57.6
$14.1
$20.5
$14.7
$8.3
$28.8
$16.9
•
Gold production in the fourth quarter was 30,675 ounces, the strongest quarter of 2016. The concurrent decline in average gold grade for the period was anticipated due to seasonal mine sequencing
•
Full-year production of 109,175 ounces of gold exceeded the high-end of Company guidance by over 9,000 ounces and represented an increase of 40% compared to 2015. This was largely the result of two additional months of production, as well as improved grades and plant recovery rates
•
Fourth quarter adjusted CAS per AuEqOz1 was relatively flat quarter-over-quarter at $556, while full-year adjusted CAS per AuEqOz1 beat guidance, decreasing 19% to $575, primarily due to lower mining and leaching costs
•
Full-year free cash flow1 of $57.6 million brings total free cash flow to $86.4 million since the acquisition of Wharf in February 2015 for $99 million
•
Production in 2017 is expected to be 85,000 - 90,000 ounces of gold at CAS per AuEqOz1 of $775 - $825, both of which reflect the anticipated completion of the higher-grade Golden Reward deposit by mid-year


8


San Bartolomé, Bolivia
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Tons milled
1,666,787
368,131
450,409
440,441
407,806
1,713,079
475,695
Average silver grade (oz/t)
3.69
3.96
3.43
3.79
3.64
3.75
3.84
Average recovery rate
88.8%
86.3%
88.7%
87.4%
93.1%
84.6%
84.9%
Silver ounces produced (000's)
5,469
1,259
1,370
1,458
1,382
5,436
1,550
Silver ounces sold (000's)
5,411
1,218
1,391
1,418
1,384
5,495
1,564
Metal sales
$93.9
$19.9
$27.5
$25.2
$21.3
$84.7
$22.4
Costs applicable to sales
$74.2
$17.3
$20.8
$18.6
$17.5
$75.8
$20.0
Adjusted CAS per AgOz1
$13.46
$13.97
$14.40
$12.97
$12.56
$13.63
$12.48
Exploration expense
$—
$—
$—
$—
$—
$0.1
$—
Cash flow from operating activities
$29.4
$4.1
$8.6
$11.2
$5.5
$26.1
$10.0
Sustaining capital expenditures
$6.6
$1.8
$3.0
$1.3
$0.5
$6.2
$2.5
Development capital expenditures
$—
$—
$—
$—
$—
$—
$—
Total capital expenditures
$6.6
$1.8
$3.0
$1.3
$0.5
$6.2
$2.5
Free cash flow1
$22.8
$2.3
$5.6
$9.9
$5.0
$19.9
$7.5
•
Fourth quarter silver production decreased 8% quarter-over-quarter to 1.3 million ounces due to an ongoing water shortage in Bolivia resulting from nationwide drought conditions
•
Full-year silver production was relatively constant at 5.5 million ounces
•
Fourth quarter and full-year adjusted CAS per silver ounce (AgOz)1 decreased 3% quarter-over-quarter and 1% year-over-year, respectively, to $13.97 and $13.46. Fourth quarter CAS per AgOz1 benefited from higher grade ore while the decrease in full-year CAS per AgOz1 was driven by lower consumables costs
•
Cash flow from operating activities and free cash flow1 for the full year were $29.4 million and $22.8 million, respectively, representing year-over-year increases of 13% and 15%
•
The Company's 2017 production guidance is 5.4 - 5.9 million silver ounces at CAS per AgOz1 of $14.00 - $14.50

Coeur Capital
(Dollars in millions, except per ounce amounts)
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Tons milled
219,430
52,711
42,335
37,521
86,863
767,314
198,927
Average silver grade (oz/t)
2.48
2.09
2.28
1.66
3.17
1.87
2.05
Average recovery rate
45.6%
39.8%
58.2%
52.5%
41.9%
43.8%
42.1%
Silver ounces produced (000's)
248
44
56
33
115
629
171
Silver ounces sold (000's)
262
58
46
35
123
615
193
Metal sales
$4.1
$0.9
$0.8
$0.5
$1.9
$8.7
$2.4
Royalty revenue
$3.3
$(0.2)
$(0.1)
$1.8
$1.8
$6.9
$1.5
Costs applicable to sales (Endeavor silver stream)
$1.7
$—
$0.4
$0.3
$1.0
$3.5
$1.0
CAS per AgOz1
$6.56
$7.06
$8.10
$7.94
$5.35
$5.72
$5.50
Cash flow from operating activities
$0.2
$2.2
$0.4
$(3.2)
$0.8
$8.2
$0.8
Free cash flow1
$0.2
$2.2
$0.4
$(3.2)
$0.8
$8.2
$0.8
•
Fourth quarter and full-year silver production from the Company's silver stream on the Endeavor mine in Australia decreased 21% quarter-over-quarter and 61% year-over-year, respectively, to 43,901 and


9


247,998 ounces, due to the operator's decision to reduce mining rates in response to lower lead and zinc prices
•
2017 production is expected to be 300,000 - 400,000 ounces of silver due to an anticipated increase in production following recent improvements in zinc and lead prices
•
Royalty revenue decreased compared to 2015 primarily due to non-core asset sales during the year that totaled $23.8 million

Exploration
Fourth quarter expensed exploration was $5.3 million, bringing full-year expensed exploration to $12.9 million, an 11% year-over-year increase, due to expanded exploration drilling activities. Fourth quarter and full-year capitalized drilling were $2.5 million and $12.9 million, respectively. As of year-end, the Company had 17 drill rigs active across Palmarejo, Kensington, Rochester, La Preciosa, and two early-stage exploration properties and had completed over 400,896 feet (122,195 meters) of combined core and reverse circulation drilling throughout the year.

Highlights from Coeur’s expanded exploration program in 2016 include:
•
Increased both surface and underground drilling at Palmarejo, and specifically at the Guadalupe and Independencia mines and the Los Bancos and Nación-Dana deposits, with eight drill rigs active at year-end
•
Accelerated surface and underground exploration at Kensington with a focus on growth at Kensington Main as well as at Jualin, Raven, and several new veins discovered through surface sampling programs
•
Continued extension and infill of the East Rochester discovery as well as resource conversion drilling within the western portions of the main pit
•
Development of a new geologic model for Wharf, which is expected to set the stage for continued resource growth

In 2017, the expensed exploration budget has been nearly doubled to $23 - $25 million with a continued focus on resource growth. Another $11 - $13 million of capital is expected to be allocated to resource conversion. Priorities for 2017 include:
•
Increased step-out drilling at all of our mine sites, with the largest budget allocation to Palmarejo
•
Continued definition drilling at La Preciosa
•
Early-stage exploration in Mexico, USA, and Canada focused on developing a long-term pipeline of high-quality projects




10


Full-Year 2017 Outlook
Full-year 2017 guidance highlights are provided below. Production guidance remains unchanged from the guidance published January 5, 2017.
•
Expected silver equivalent1 production increase driven by ongoing acceleration of Palmarejo underground operations offset by lower expected production at Wharf
•
Higher expected CAS per AuEqOz1 at Wharf due to anticipated completion of mining of the higher-grade Golden Reward deposit, higher tons mined compared to 2016, and one-time plant maintenance expenses
•
Anticipated increase in capital expenditures driven by carryover from 2016, the Stage IV leach pad expansion at Rochester, and higher underground development levels at Kensington and Palmarejo
•
Higher exploration expense primarily due to step-out drilling at Palmarejo, definition drilling at La Preciosa, and early-stage exploration

2017 Production Outlook
(silver and silver equivalent ounces in thousands)
Silver
Gold
Silver Equivalent1
Palmarejo
6,500 - 7,000
110,000 - 120,000
13,100 - 14,200
Rochester
4,200 - 4,700
47,000 - 52,000
7,020 - 7,820
San Bartolomé
5,400 - 5,900
—
5,400 - 5,900
Endeavor
300 - 400
—
300 - 400
Kensington
—
120,000 - 125,000
7,200 - 7,500
Wharf
—
85,000 - 90,000
5,100 - 5,400
Total
16,400 - 18,000
362,000 - 387,000
38,120 - 41,220

2017 Cost Outlook
 
2017 Guidance Based On
 
2016 Results3 Based On
(dollars in millions, except per ounce amounts)
60:1
69:1 Spot
 
60:1
Average Spot
CAS per AgEqOz1 – Palmarejo
$10.00 - $10.50
$9.25 - $9.75
 
$10.55
$9.57
CAS per AgEqOz1 – Rochester
$11.50 - $12.00
$10.75 - $11.25
 
$11.86
$10.93
CAS per AgOz1 – San Bartolomé
$14.00 - $14.50
 
$13.46
CAS per AuOz1 – Kensington
$800 - $850
 
$790
CAS per AuEqOz1 – Wharf
$775 - $825
 
$575
Capital Expenditures
$115 - $135
 
$101
General and Administrative Expenses
$28 - $32
 
$29
Exploration Expense
$23 - $25
 
$13
AISC per AgEqOz1
$15.75 - $16.25
$14.50 - $15.00
 
$15.88
$14.09

Conference Call Information
Coeur will report its full operational and financial results for fourth quarter and full-year 2016 on February 8, 2017 after the New York Stock Exchange closes for trading. There will be a conference call on February 9, 2017 at 11:00 a.m. Eastern time.


11


Dial-In Numbers:     (855) 560-2581 (US)
(855) 669-9657 (Canada)        
                                (412) 542-4166 (International)
Conference ID:        Coeur Mining
The conference call and presentation will also be webcast on the Company’s website www.coeur.com. Hosting the call will be Mitchell J. Krebs, President and Chief Executive Officer of Coeur, who will be joined by Peter C. Mitchell, Senior Vice President and Chief Financial Officer, Frank L. Hanagarne, Jr., Senior Vice President and Chief Operating Officer, Hans Rasmussen, Senior Vice President of Exploration, and other members of management. A replay of the call will be available through February 23, 2017.
Replay numbers:      (877) 344-7529 (US)
(855) 669-9658 (Canada)    
                            (412) 317-0088 (International)
Conference ID:        100 98 890

About Coeur
Coeur Mining is a well-diversified, growing precious metals producer with five precious metals mines in the Americas employing approximately 2,000 people. Coeur produces from its wholly owned operations: the Palmarejo silver-gold complex in Mexico, the Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska, the Wharf gold mine in South Dakota, and the San Bartolomé silver mine in Bolivia. The Company also has a non-operating interest in the Endeavor mine in Australia. In addition, the Company owns the La Preciosa project in Mexico, a silver-gold exploration stage project. Coeur conducts ongoing exploration activities in Alaska, Nevada, South Dakota, and Mexico.

Cautionary Statement
This news release contains forward-looking statements within the meaning of securities legislation in the United States and Canada, including statements regarding interest expense, production, costs, capital expenditures, expenses, mining rates, development activity at Palmarejo and Kensington, expansion at Rochester, transitioning to a lower-cost, high-quality profitable precious metals producer, cash flow, mine lives, growth, operations at Kensington and Wharf, drilling, resource growth and conversion, development of a pipeline of future projects, and exploration efforts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause Coeur's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the risk that anticipated production, cost and expense levels are not attained, the risks and hazards inherent in the mining business (including risks inherent in developing large-scale mining projects, environmental hazards, industrial accidents, weather or geologically related conditions), changes in the market prices of gold and silver and a sustained lower price environment, the uncertainties inherent in Coeur's production, exploratory and developmental activities, including risks relating to permitting and regulatory delays, ground conditions, grade variability, any future labor disputes or work stoppages (including those involving third parties), the uncertainties inherent in the estimation of gold and silver reserves and resources, changes that could result from Coeur's future acquisition of new mining properties or businesses, the absence of control over and reliance on third parties to operate mining operations in which Coeur or its subsidiaries hold royalty or streaming interests and risks related to these mining operations (including results of mining and exploration activities, environmental, economic and political risks of the jurisdiction in which the mining operations are located), the loss of access to any third-party smelter to whom Coeur markets silver and gold, the effects of environmental and other governmental regulations, the risks inherent in the ownership or operation of or investment in mining properties or businesses in foreign countries, the political risks and uncertainties associated with recent developments in Bolivia, Coeur's ability to raise additional financing necessary to conduct its business, make payments or refinance its debt, as well as other uncertainties and risk factors set out in filings made from time to time with the United States Securities and Exchange Commission, and the Canadian securities regulators, including, without limitation, Coeur's most recent report on Form 10-K. Actual results, developments and timetables could vary significantly from the estimates presented. Readers are cautioned not to put undue reliance on forward-looking statements. Coeur disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, Coeur undertakes no obligation

12


to comment on analyses, expectations or statements made by third parties in respect of Coeur, its financial or operating results or its securities.
Christopher Pascoe, Coeur's Director, Technical Services and a qualified person under Canadian National Instrument 43-101, approved the scientific and technical information concerning Coeur's mineral projects in this news release. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources, as well as data verification procedures and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant factors, Canadian investors should refer to the Technical Reports for each of Coeur's properties as filed on SEDAR at www.sedar.com.

Non-U.S. GAAP Measures
We supplement the reporting of our financial information determined under United States generally accepted accounting principles (U.S. GAAP) with certain non-U.S. GAAP financial measures, including EBITDA, adjusted EBITDA, net debt, total debt to LTM adjusted EBITDA, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), all-in sustaining costs, and adjusted all-in sustaining costs. We believe that these adjusted measures provide meaningful information to assist management, investors and analysts in understanding our financial results and assessing our prospects for future performance. We believe these adjusted financial measures are important indicators of our recurring operations because they exclude items that may not be indicative of, or are unrelated to our core operating results, and provide a better baseline for analyzing trends in our underlying businesses. We believe EBITDA, adjusted EBITDA, net debt, total debt to LTM adjusted EBITDA, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), all-in sustaining costs, and adjusted all-in sustaining costs are important measures in assessing the Company's overall financial performance. For additional explanation regarding our use of non-U.S. GAAP financial measures, please refer to our Form 10-K for the year ended December 31, 2016.

Notes
1. EBITDA, adjusted EBITDA, net debt, total debt to LTM adjusted EBITDA, adjusted net income (loss), costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), adjusted costs applicable to sales per silver equivalent ounce (or per gold equivalent ounce or per average spot silver equivalent ounce), all-in sustaining costs, and adjusted all-in sustaining costs are non-GAAP measures. Please see tables in the Appendix for the reconciliation to U.S. GAAP. For purposes of silver and gold equivalence, a 60:1 silver to gold ratio is assumed except where noted as average spot prices. Please see table below for average silver and gold spot prices during the period and the silver to gold ratio. Free cash flow is defined as cash flow from operating activities less capital expenditures and gold production royalty payments. Please see table in Appendix for the calculation of consolidated free cash flow.
2. Includes capital leases. Net of debt issuance costs and premium received.
3. 2016 results reflect adjusted CAS and AISC. Please see reconciliation tables in the Appendix for additional information.

Average Spot Prices
 
2016
4Q 2016
3Q 2016
2Q 2016
1Q 2016
2015
4Q 2015
Average Silver Spot Price Per Ounce
$
17.14

$
17.19

$
19.61

$
16.78

$
14.85

$
15.68

$
14.77

Average Gold Spot Price Per Ounce
$
1,251

$
1,222

$
1,335

$
1,260

$
1,183

$
1,160

$
1,106

Average Silver to Gold Spot Equivalence
73:1

71:1

68:1

75:1

80:1

74:1

75:1


For Additional Information:
Courtney Lynn, Vice President, Investor Relations and Treasurer
(312) 489-5837

www.coeur.com

13


Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Loss)

 
Year ended December 31,
 
2016
 
2015
 
2014
 
In thousands, except share data
Revenue
$
665,777

 
$
646,086

 
$
635,742

COSTS AND EXPENSES
 
 
 
 
 
Costs applicable to sales(1)
409,541

 
479,654

 
477,945

Amortization
123,161

 
143,751

 
162,436

General and administrative
29,376

 
32,834

 
40,845

Exploration
12,930

 
11,647

 
21,740

Write-downs
4,446

 
313,337

 
1,472,721

Pre-development, reclamation, and other
17,219

 
17,793

 
26,037

Total costs and expenses
596,673

 
999,016

 
2,201,724

OTHER INCOME (EXPENSE), NET
 
 
 
 
 
Gain (loss) on debt extinguishment
(21,365
)
 
15,916

 
—

Fair value adjustments, net
(11,581
)
 
5,202

 
3,618

Interest expense, net of capitalized interest
(36,920
)
 
(45,703
)
 
(47,546
)
Other, net
1,875

 
(15,931
)
 
(5,218
)
Total other income (expense), net
(67,991
)
 
(40,516
)
 
(49,146
)
Income (loss) before income and mining taxes
1,113

 
(393,446
)
 
(1,615,128
)
Income and mining tax (expense) benefit
54,239

 
26,263

 
428,254

NET INCOME (LOSS)
$
55,352

 
$
(367,183
)
 
$
(1,186,874
)
OTHER COMPREHENSIVE INCOME (LOSS), net of tax:
 
 
 
 
 
Unrealized gain (loss) on equity securities, net of tax of $(767) and $1,446 for the years ended December 31, 2016, and 2014, respectively
3,222

 
(4,154
)
 
(2,290
)
Reclassification adjustments for impairment of equity securities, net of tax of $(2,552) for the year ended December 31, 2014
703

 
2,346

 
4,042

Reclassification adjustments for realized (gain) loss on sale of equity securities, net of tax of $(219) for the year ended December 31, 2014
(2,691
)
 
894

 
346

Other comprehensive income (loss)
1,234

 
(914
)
 
2,098

COMPREHENSIVE INCOME (LOSS)
$
56,586

 
$
(368,097
)
 
$
(1,184,776
)
 
 
 
 
 
 
NET INCOME (LOSS) PER SHARE
 
 
 
 
 
Basic
$
0.35

 
$
(2.83
)
 
$
(11.59
)
 
 
 
 
 
 
Diluted
$
0.34

 
$
(2.83
)
 
$
(11.59
)


14


Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows

 
Year ended December 31,
 
2016
 
2015
 
2014
 
In thousands
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
Net income (loss)
$
55,352

 
(367,183
)
 
(1,186,874
)
Adjustments:
 
 
 
 
 
Amortization
123,161

 
143,751

 
162,436

Accretion
10,248

 
14,149

 
16,246

Deferred income taxes
(71,350
)
 
(40,838
)
 
(448,905
)
Loss on termination of revolving credit facility
—

 
—

 
3,035

(Gain) Loss on extinguishment of debt
21,365

 
(15,916
)
 
—

Fair value adjustments, net
11,581

 
(5,202
)
 
(3,618
)
Stock-based compensation
9,715

 
9,272

 
9,288

Impairment of equity securities
703

 
2,346

 
6,593

Write-downs
4,446

 
313,337

 
1,472,721

Other
(1,067
)
 
16,303

 
124

Changes in operating assets and liabilities:
 
 
 
 
 
Receivables
9,011

 
17,560

 
(11,611
)
Prepaid expenses and other current assets
(826
)
 
(3,063
)
 
5,635

Inventory and ore on leach pads
(35,591
)
 
19,573

 
12,971

Accounts payable and accrued liabilities
(10,931
)
 
9,453

 
15,507

CASH PROVIDED BY OPERATING ACTIVITIES
125,817

 
113,542

 
53,548

CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
 
 
Capital expenditures
(101,013
)
 
(95,193
)
 
(64,244
)
Acquisitions, net
(1,417
)
 
(110,846
)
 
(21,329
)
Proceeds from the sale of assets
16,296

 
607

 
329

Purchase of investments
(178
)
 
(1,880
)
 
(50,513
)
Sales and maturities of investments
7,077

 
605

 
54,344

Other
(4,208
)
 
(4,586
)
 
(321
)
CASH USED IN INVESTING ACTIVITIES
(83,443
)
 
(211,293
)
 
(81,734
)
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
 
 
Issuance of common stock
269,556

 
—

 
—

Issuance of notes and bank borrowings
—

 
153,500

 
167,784

Payments on debt, capital leases, and associated costs
(322,801
)
 
(84,715
)
 
(25,902
)
Gold production royalty payments
(27,155
)
 
(39,235
)
 
(48,395
)
Other
172

 
(542
)
 
(509
)
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
(80,228
)
 
29,008

 
92,978

Effect of exchange rate changes on cash and cash equivalents
(678
)
 
(1,404
)
 
(621
)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(38,532
)
 
(70,147
)
 
64,171

Cash and cash equivalents at beginning of period
200,714

 
270,861

 
206,690

Cash and cash equivalents at end of period
$
162,182

 
$
200,714


$
270,861



15


Coeur Mining, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets

 
December 31, 2016
 
December 31, 2015
ASSETS
In thousands, except share data
CURRENT ASSETS
 
 
 
Cash and cash equivalents
$
162,182

 
$
200,714

Receivables
60,431

 
85,992

Inventory
106,026

 
81,711

Ore on leach pads
64,167

 
67,329

Prepaid expenses and other
17,981

 
10,942

 
410,787

 
446,688

NON-CURRENT ASSETS
 
 
 
Property, plant and equipment, net
216,796

 
195,999

Mining properties, net
558,455

 
589,219

Ore on leach pads
67,231

 
44,582

Restricted assets
17,597

 
11,633

Equity securities
4,488

 
2,766

Receivables
30,951

 
24,768

Deferred tax assets
191

 
1,942

Other
12,413

 
14,892

TOTAL ASSETS
$
1,318,909

 
$
1,332,489

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
CURRENT LIABILITIES
 
 
 
Accounts payable
$
53,335

 
$
52,153

Accrued liabilities and other
42,743

 
50,532

Debt
12,039

 
10,431

Royalty obligations
4,995

 
24,893

Reclamation
3,522

 
2,071

 
116,634

 
140,080

NON-CURRENT LIABILITIES
 
 
 
Debt
198,857

 
479,979

Royalty obligations
4,292

 
4,864

Reclamation
95,804

 
83,197

Deferred tax liabilities
74,798

 
147,132

Other long-term liabilities
60,037

 
55,761

 
433,788

 
770,933

STOCKHOLDERS’ EQUITY
 
 
 
Common stock, par value $0.01 per share; authorized 300,000,000 shares, issued and outstanding 180,933,287 at December 31, 2016 and 151,339,136 at December 31, 2015
1,809

 
1,513

Additional paid-in capital
3,314,590

 
3,024,461

Accumulated other comprehensive income (loss)
(2,488
)
 
(3,722
)
Accumulated deficit
(2,545,424
)
 
(2,600,776
)
 
768,487

 
421,476

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
1,318,909

 
$
1,332,489





16


Adjusted EBITDA Reconciliation
(Dollars in thousands except per share amounts)
2016
 
4Q 2016
 
3Q 2016
 
2Q 2016
 
1Q 2016
 
2015
 
4Q 2015
Net income (loss)
$
55,352

 
$
(8,306
)
 
$
69,557

 
$
14,497

 
$
(20,396
)
 
$
(367,183
)
 
$
(303,000
)
Interest expense, net of capitalized interest
36,920

 
6,857

 
8,068

 
10,875

 
11,120

 
45,703

 
11,758

Income tax provision (benefit)
(54,239
)
 
(1,122
)
 
(54,455
)
 
(768
)
 
2,106

 
(26,263
)
 
(17,811
)
Amortization
123,161

 
29,929

 
27,763

 
37,505

 
27,964

 
143,751

 
36,190

EBITDA
161,194

 
27,358

 
50,933


62,109

 
20,794

 
(203,992
)
 
(272,863
)
Fair value adjustments, net
11,581

 
(1,654
)
 
961

 
3,579

 
8,695

 
(5,202
)
 
(1,546
)
Impairment of equity securities
703

 
683

 
—

 
20

 
—

 
2,346

 
317

Foreign exchange loss
10,720

 
3,435

 
1,466

 
5,655

 
164

 
15,769

 
2,597

(Gain) loss on sale of assets
(11,334
)
 
339

 
(7,462
)
 
(3,126
)
 
(1,085
)
 
352

 
(168
)
(Gain) loss on debt extinguishment
21,365

 
11,325

 
10,040

 
—

 
—

 
(15,916
)
 
(16,187
)
Corporate reorganization costs
—

 
—

 
—

 
—

 
—

 
647

 
133

Transaction-related costs
1,199

 
1

 
26

 
792

 
380

 
2,112

 
99

Asset retirement obligation accretion
8,369

 
2,147

 
2,096

 
2,066

 
2,060

 
8,191

 
2,288

Inventory adjustments and write-downs
6,917

 
389

 
4,665

 
946

 
1,944

 
10,207

 
4,901

Write-downs
4,446

 
—

 
—

 
—

 
4,446

 
313,337

 
313,337

Adjusted EBITDA
$
215,160

 
$
44,023

 
$
62,725


$
72,041

 
$
37,398

 
$
127,851

 
$
32,908



Adjusted Net Income (Loss) Reconciliation
(Dollars in thousands except per share amounts)
2016
 
4Q 2016
 
3Q 2016
 
2Q 2016
 
1Q 2016
 
2015
 
4Q 2015
Net income (loss)
$
55,352

 
$
(8,306
)
 
$
69,557

 
$
14,497

 
$
(20,396
)
 
$
(367,183
)
 
$
(303,000
)
Fair value adjustments, net
11,581

 
(1,654
)
 
961

 
3,579

 
8,695

 
(5,202
)
 
(1,546
)
Impairment of equity securities
703

 
683

 
—

 
20

 
—

 
2,346

 
317

Write-downs
4,446

 
—

 
—

 
—

 
4,446

 
313,337

 
313,337

Inventory write-downs
3,689

 
—

 
3,689

 
—

 
—

 
—

 
—

(Gain) loss on sale of assets
(11,334
)
 
339

 
(7,462
)
 
(3,126
)
 
(1,085
)
 
352

 
(168
)
(Gain) loss on debt extinguishments
21,365

 
11,325

 
10,040

 
—

 
—

 
(15,916
)
 
(16,187
)
Corporate reorganization costs
—

 
—

 
—

 
—

 
—

 
647

 
133

Transaction-related costs
1,199

 
1

 
26

 
792

 
380

 
2,112

 
99

Deferred tax on reorganization
(40,767
)
 
—

 
(40,767
)
 
—

 
—

 
—

 
—

Foreign exchange (gain) loss
(1,034
)
 
351

 
2,549

 
(2,810
)
 
(1,124
)
 
1,599

 
753

Tax effect of adjustments
2,583

 
—

 
(38
)
 
$
3,996

 
$
(1,375
)
 
(35,734
)
 
$
(37,727
)
Adjusted net income (loss)
$
47,783

 
$
2,739

 
$
38,555


$
16,948


$
(10,459
)
 
$
(103,642
)

$
(43,989
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted net income (loss) per share - Basic
$
0.30

 
$
0.01

 
$
0.24

 
$
0.11

 
$
(0.06
)
 
$
(0.80
)
 
$
(0.31
)
Adjusted net income (loss) per share - Diluted
$
0.29

 
$
0.01

 
$
0.23


$
0.11

 
$
(0.06
)
 
$
(0.80
)
 
$
(0.31
)



17


Consolidated Debt Reconciliation
(Dollars in thousands)
2016
 
2015
 
LTM 3Q 2015
Cash and cash equivalents
$
162,182

 
$
200,714

 
$
205,708

Total debt
210,896

 
490,410

 
545,986

Net debt
48,714

 
289,696

 
340,278

LTM adjusted EBITDA
215,160

 
127,851

 
99,713

Total debt / LTM adjusted EBITDA
1.0
x
 
3.8
x
 
5.5x
Net debt / LTM adjusted EBITDA
0.2
x
 
2.3
x
 
3.4x

Consolidated Free Cash Flow Reconciliation
(Dollars in thousands)
2016
 
4Q 2016
 
3Q 2016
 
2Q 2016
 
1Q 2016
 
2015
 
4Q 2015
Cash flow from operating activities
$
125,817

 
$
25,449

 
$
47,812

 
$
45,939

 
$
6,617

 
$
113,542

 
$
43,217

Capital expenditures
(101,013
)
 
(29,926
)
 
(25,627
)
 
(23,288
)
 
(22,172
)
 
(95,193
)
 
(30,035
)
Gold production royalty payments
(27,155
)
 
—

 
(7,563
)
 
(10,461
)
 
(9,131
)
 
(39,235
)
 
(8,954
)
Free cash flow
(2,351
)

(4,477
)
 
14,622


12,190

 
(24,686
)

(20,886
)
 
4,228





































18




Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Year Ended December 31, 2016
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
117,419

 
$
111,564

 
$
80,799

 
$
2,363

 
$
312,145

 
$
131,518

 
$
87,000

 
$
218,518

 
$
530,663

Amortization
 
36,599

 
21,838

 
6,633

 
644

 
65,714

 
34,787

 
20,621

 
55,408

 
121,122

Costs applicable to sales
 
$
80,820

 
$
89,726

 
$
74,166

 
$
1,719

 
$
246,431

 
$
96,731

 
$
66,379

 
$
163,110

 
$
409,541

Silver equivalent ounces sold
 
7,538,311

 
7,542,740

 
5,411,057

 
262,078

 
20,754,186

 
 
 
 
 
 
 
34,632,666

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
121,688

 
109,620

 
231,308

 
 
Costs applicable to sales per ounce
 
$
10.72

 
$
11.90

 
$
13.71

 
$
6.56

 
$
11.87

 
$
795

 
$
606

 
$
705

 
$
11.83

Inventory adjustments
 
(0.17
)
 
(0.04
)
 
(0.25
)
 
—

 
(0.14
)
 
(5
)
 
(31
)
 
(17
)
 
(0.20
)
Adjusted costs applicable to sales per ounce
 
$
10.55

 
$
11.86

 
$
13.46

 
$
6.56

 
$
11.73

 
$
790

 
$
575

 
$
688

 
$
11.63

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
9.73

 
$
10.97

 
 
 
 
 
$
11.12

 
 
 
 
 
 
 
$
10.50

Inventory adjustments
 
(0.16
)
 
(0.04
)
 
 
 
 
 
(0.13
)
 
 
 
 
 
 
 
(0.18
)
Adjusted costs applicable to sales per average spot ounce
 
$
9.57

 
$
10.93

 
 
 
 
 
$
10.99

 
 
 
 
 
 
 
$
10.32

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
409,541

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,307

Sustaining capital(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
77,841

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
29,376

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,930

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,504

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,481

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
556,980

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
20,754,186

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
13,878,480

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
34,632,666

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.08

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.20
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
15.88

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.27

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.18
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
14.09




















19




Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended December 31, 2016
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
29,667

 
$
29,581

 
$
18,514

 
$
557

 
$
78,319

 
$
31,577

 
$
21,861

 
$
53,438

 
$
131,757

Amortization
 
8,784

 
5,844

 
1,303

 
148

 
16,079

 
8,584

 
4,982

 
13,566

 
29,645

Costs applicable to sales
 
$
20,883

 
$
23,737

 
$
17,211

 
$
409

 
$
62,240

 
$
22,993

 
$
16,879

 
$
39,872

 
$
102,112

Silver equivalent ounces sold
 
1,871,178

 
1,983,393

 
1,217,659

 
57,903

 
5,130,133

 
 
 
 
 
 
 
8,674,273

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
28,864

 
30,205

 
59,069

 
 
Costs applicable to sales per ounce
 
$
11.16

 
$
11.97

 
$
14.13

 
$
7.06

 
$
12.13

 
$
797

 
$
559

 
$
675

 
$
11.77

Inventory adjustments
 
(0.15
)
 
0.02

 
(0.16
)
 
—

 
(0.08
)
 
4

 
(3
)
 
1

 
(0.04
)
Adjusted costs applicable to sales per ounce
 
$
11.01

 
$
11.99

 
$
13.97

 
$
7.06

 
$
12.05

 
$
801

 
$
556

 
$
676

 
$
11.73

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
10.24

 
$
11.14

 
 
 
 
 
$
11.42

 
 
 
 
 
 
 
$
10.59

Inventory adjustments
 
(0.13
)
 
0.02

 
 
 
 
 
(0.08
)
 
 
 
 
 
 
 
(0.04
)
Adjusted costs applicable to sales per average spot ounce
 
$
10.11

 
$
11.16

 
 
 
 
 
$
11.34

 
 
 
 
 
 
 
$
10.55

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
102,112

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,261

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
19,850

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6,587

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,261

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,537

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,693

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
140,301

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,130,133

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
3,544,140

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,674,273

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.17

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.04
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.13

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.56

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.04
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
14.52




















20




Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended September 30, 2016
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
21,794

 
$
27,027

 
$
22,536

 
$
486

 
$
71,843

 
$
34,755

 
$
26,158

 
$
60,913

 
$
132,756

Amortization
 
5,761

 
5,244

 
1,723

 
113

 
12,841

 
8,046

 
6,461

 
14,507

 
27,348

Costs applicable to sales
 
$
16,033

 
$
21,783

 
$
20,813

 
$
373

 
$
59,002

 
$
26,709

 
$
19,697

 
$
46,406

 
$
105,408

Silver equivalent ounces sold
 
1,462,401

 
1,868,085

 
1,390,552

 
46,069

 
4,767,107

 
 
 
 
 
 
 
8,397,467

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
30,998

 
29,508

 
60,506

 
 
Costs applicable to sales per ounce
 
$
10.96

 
$
11.66

 
$
14.97

 
$
8.10

 
$
12.38

 
$
862

 
$
668

 
$
767

 
$
12.55

Inventory adjustments
 
(0.26
)
 
(0.10
)
 
(0.57
)
 
—

 
(0.28
)
 
(3
)
 
(109
)
 
(55
)
 
(0.56
)
Adjusted costs applicable to sales per ounce
 
$
10.70

 
$
11.56

 
$
14.40

 
$
8.10

 
$
12.10

 
$
859

 
$
559

 
$
712

 
$
11.99

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
10.29

 
$
11.11

 
 
 
 
 
$
11.91

 
 
 
 
 
 
 
$
11.62

Inventory adjustments
 
(0.24
)
 
(0.09
)
 
 
 
 
 
(0.27
)
 
 
 
 
 
 
 
(0.52
)
Adjusted costs applicable to sales per average spot ounce
 
$
10.05

 
$
11.02

 
 
 
 
 
$
11.64

 
 
 
 
 
 
 
$
11.10

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
105,408

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
761

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
19,762

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,113

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,706

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,036

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,133

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
142,919

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,767,107

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
3,630,360

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,397,467

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
17.02

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.56
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.46

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
15.75

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.52
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
15.23



21


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended June 30, 2016
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
37,630

 
$
27,158

 
$
20,498

 
$
365

 
$
85,651

 
$
32,419

 
$
19,470

 
$
51,889

 
$
137,540

Amortization
 
14,765

 
5,437

 
1,853

 
84

 
22,139

 
9,808

 
5,128

 
14,936

 
37,075

Costs applicable to sales
 
$
22,865

 
$
21,721

 
$
18,645

 
$
281

 
$
63,512

 
$
22,611

 
$
14,342

 
$
36,953

 
$
100,465

Silver equivalent ounces sold
 
2,502,442

 
1,911,885

 
1,418,455

 
35,411

 
5,868,193

 
 
 
 
 
 
 
9,286,033

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
30,178

 
26,786

 
56,964

 
 
Costs applicable to sales per ounce
 
$
9.14

 
$
11.36

 
$
13.14

 
$
7.94

 
$
10.82

 
$
749

 
$
535

 
$
649

 
$
10.82

Inventory adjustments
 
(0.12
)
 
(0.06
)
 
(0.17
)
 
—

 
(0.11
)
 
(9
)
 
(1
)
 
(5
)
 
(0.10
)
Adjusted costs applicable to sales per ounce
 
$
9.02

 
$
11.30

 
$
12.97

 
$
7.94

 
$
10.71

 
$
740

 
$
534

 
$
644

 
$
10.72

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
8.20

 
$
10.30

 
 
 
 
 
$
10.00

 
 
 
 
 
 
 
$
9.45

Inventory adjustments
 
(0.11
)
 
(0.06
)
 
 
 
 
 
(0.10
)
 
 
 
 
 
 
 
(0.09
)
Adjusted costs applicable to sales per average spot ounce
 
$
8.09

 
$
10.24

 
 
 
 
 
$
9.90

 
 
 
 
 
 
 
$
9.36

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
100,465

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,128

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
21,019

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,400

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,233

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,170

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,098

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
138,513

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,868,193

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
3,417,840

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,286,033

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.92

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.10
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.82

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
13.04

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.09
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
12.95






















22


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended March 31, 2016
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
28,327

 
$
27,798

 
$
19,251

 
$
955

 
$
76,331

 
$
32,767

 
$
19,512

 
$
52,279

 
$
128,610

Amortization
 
7,289

 
5,313

 
1,754

 
299

 
14,655

 
8,349

 
4,051

 
12,400

 
27,055

Costs applicable to sales
 
$
21,038

 
$
22,485

 
$
17,497

 
$
656

 
$
61,676

 
$
24,418

 
$
15,461

 
$
39,879

 
$
101,555

Silver equivalent ounces sold
 
1,702,290

 
1,779,377

 
1,384,391

 
122,694

 
4,988,752

 
 
 
 
 
 
 
8,274,952

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
31,648

 
23,122

 
54,770

 
 
Costs applicable to sales per ounce
 
$
12.36

 
$
12.64

 
$
12.64

 
$
5.35

 
$
12.36

 
$
772

 
$
669

 
$
728

 
$
12.27

Inventory adjustments
 
(0.82
)
 
(0.03
)
 
(0.08
)
 
—

 
(0.31
)
 
(11
)
 
(2
)
 
(7
)
 
(0.23
)
Adjusted costs applicable to sales per ounce
 
$
11.54

 
$
12.61

 
$
12.56

 
$
5.35

 
$
12.05

 
$
761

 
$
667

 
$
721

 
$
12.04

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
10.74

 
$
11.20

 
 
 
 
 
$
11.28

 
 
 
 
 
 
 
$
10.34

Inventory adjustments
 
(0.71
)
 
(0.03
)
 
 
 
 
 
(0.28
)
 
 
 
 
 
 
 
(0.20
)
Adjusted costs applicable to sales per average spot ounce
 
$
10.03

 
$
11.17

 
 
 
 
 
$
11.00

 
 
 
 
 
 
 
$
10.14

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
101,555

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,158

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,710

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,276

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,731

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,759

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,558

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
134,747

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,988,752

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
3,286,200

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,274,952

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.28

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.23
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.05

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
13.71

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.20
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
13.51






















23


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Year Ended December 31, 2015
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
170,899

 
$
127,900

 
$
93,625

 
$
9,059

 
$
401,483

 
$
147,880

 
$
68,575

 
$
216,455

 
$
617,938

Amortization
 
32,423

 
23,906

 
17,798

 
5,539

 
79,666

 
42,240

 
16,378

 
58,618

 
138,284

Costs applicable to sales
 
$
138,476

 
$
103,994

 
$
75,827

 
$
3,520

 
$
321,817

 
$
105,640

 
$
52,197

 
$
157,837

 
$
479,654

Silver equivalent ounces sold
 
9,840,705

 
8,377,823

 
5,495,369

 
615,022

 
24,328,919

 
 
 
 
 
 
 
36,659,759

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
131,553

 
73,961

 
205,514

 
 
Costs applicable to sales per ounce
 
$
14.07

 
$
12.41

 
$
13.80

 
$
5.72

 
$
13.23

 
$
803

 
$
706

 
$
768

 
$
13.08

Inventory adjustments
 
(1.04
)
 
(0.05
)
 
(0.17
)
 
—

 
(0.48
)
 
(5
)
 
—

 
(4
)
 
(0.34
)
Adjusted costs applicable to sales per ounce
 
$
13.03

 
$
12.36

 
$
13.63

 
$
5.72

 
$
12.75

 
$
798

 
$
706

 
$
764

 
$
12.74

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
12.75

 
$
11.32

 
 
 
 
 
$
12.31

 
 
 
 
 
 
 
$
11.60

Inventory adjustments
 
(0.95
)
 
(0.04
)
 
 
 
 
 
(0.44
)
 
 
 
 
 
 
 
(0.30
)
Adjusted costs applicable to sales per average spot ounce
 
$
11.80

 
$
11.28

 
 
 
 
 
$
11.87

 
 
 
 
 
 
 
$
11.30

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
479,654

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,801

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
53,362

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
32,834

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11,647

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,769

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,674

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
604,741

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
24,328,919

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
12,330,840

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
36,659,759

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.50

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.34
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.16

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.62

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.30
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
14.32






















24


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for Three Months Ended December 31, 2015
 
 
Silver
 
Gold
 
Total
In thousands except per ounce amounts
 
Palmarejo
 
Rochester
 
San Bartolomé
 
Endeavor
 
Total
 
Kensington
 
Wharf
 
Total
 
Costs applicable to sales, including amortization (U.S. GAAP)
 
$
47,207

 
$
27,716

 
$
24,372

 
$
2,579

 
$
101,874

 
$
33,298

 
$
25,033

 
$
58,331

 
$
160,205

Amortization
 
7,426

 
4,944

 
4,311

 
1,519

 
18,200

 
9,503

 
7,246

 
16,749

 
34,949

Costs applicable to sales
 
$
39,781

 
$
22,772

 
$
20,061

 
$
1,060

 
$
83,674

 
$
23,795

 
$
17,787

 
$
41,582

 
$
125,256

Silver equivalent ounces sold
 
2,588,185

 
1,820,471

 
1,564,155

 
192,768

 
6,165,579

 
 
 
 
 
 
 
9,885,699

Gold equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
29,988

 
32,014

 
62,002

 
 
Costs applicable to sales per ounce
 
$
15.37

 
$
12.51

 
$
12.83

 
$
5.50

 
$
13.57

 
$
793

 
$
556

 
$
671

 
$
12.67

Inventory adjustments
 
(1.89
)
 
(0.14
)
 
(0.35
)
 
—

 
(0.92
)
 
(16
)
 
—

 
(8
)
 
(0.62
)
Adjusted costs applicable to sales per ounce
 
$
13.48

 
$
12.37

 
$
12.48

 
$
5.50

 
$
12.65

 
$
777

 
$
556

 
$
663

 
$
12.05

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales per average spot ounce
 
$
13.88

 
$
11.44

 
 
 
 
 
$
12.66

 
 
 
 
 
 
 
$
11.14

Inventory adjustments
 
(1.73
)
 
(0.12
)
 
 
 
 
 
(0.87
)
 
 
 
 
 
 
 
(0.57
)
Adjusted costs applicable to sales per average spot ounce
 
$
12.15

 
$
11.32

 
 
 
 
 
$
11.79

 
 
 
 
 
 
 
$
10.57

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
125,256

Treatment and refining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
964

Sustaining capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,567

General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,855

Exploration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,689

Reclamation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,963

Project/pre-development costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,691

All-in sustaining costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
160,985

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6,165,579

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
3,720,120

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,885,699

All-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
16.28

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.62
)
Adjusted all-in sustaining costs per silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
15.66

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
All-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
 
 
$
14.30

Inventory adjustments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(0.57
)
Adjusted all-in sustaining costs per average spot silver equivalent ounce
 
 
 
 
 
 
 
 
 
 
 
$
13.73






















25


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for 2017 Guidance
 
Silver
Gold
 
In thousands except per ounce amounts
Palmarejo
Rochester
San Bartolomé
Endeavor
Total Silver
Kensington
Wharf
Total Gold
Total Combined
Costs applicable to sales, including amortization (U.S. GAAP)
$
211,000

$
108,380

$
102,000

$
3,750

$
425,130

$
130,500

$
83,800

$
214,300

$
639,430

Amortization
69,200

19,860

18,500

—

107,560

29,100

11,500

40,600

148,160

Costs applicable to sales
$
141,800

$
88,520

$
83,500

$
3,750

$
317,570

$
101,400

$
72,300

$
173,700

$
491,270

Silver equivalent ounces sold
14,000,000

7,680,000

5,900,000

380,000

27,960,000

 
 
 
40,800,000

Gold equivalent ounces sold
 
 
 
 
 
124,000

90,000

214,000


Costs applicable to sales per ounce guidance
$10.00 - $10.50
$11.50 - $12.00
$14.00 - $14.50
 
 
$800 - $850
$775 - $825
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
$
491,270

Treatment and refining costs
 
 
 
 
 
 
 
 
4,300

Sustaining capital, including capital lease payments
 
 
 
 
 
 
88,000

General and administrative
 
 
 
 
 
 
 
 
30,000

Exploration
 
 
 
 
 
 
 
 
24,000

Reclamation
 
 
 
 
 
 
 
 
14,000

Project/pre-development costs
 
 
 
 
 
 
 
 
5,700

All-in sustaining costs
 
 
 
 
 
 
 
 
$
657,270

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
27,960,000

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
12,840,000

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
40,800,000

All-in sustaining costs per silver equivalent ounce guidance
 
 
 
 
 
$15.75 - $16.25


































26


Reconciliation of All-in Sustaining Costs per 69:1 Spot Silver Equivalent Ounce
for 2017 Guidance
 
Silver
Gold
 
In thousands except per ounce amounts
Palmarejo
Rochester
San Bartolomé
Endeavor
Total Silver
Kensington
Wharf
Total Gold
Total Combined
Costs applicable to sales, including amortization (U.S. GAAP)
$
211,000

$
108,380

$
102,000

$
3,750

$
425,130

$
130,500

$
83,800

$
214,300

$
639,430

Amortization
69,200

19,860

18,500

—

107,560

29,100

11,500

40,600

148,160

Costs applicable to sales
$
141,800

$
88,520

$
83,500

$
3,750

$
317,570

$
101,400

$
72,300

$
173,700

$
491,270

Silver equivalent ounces sold
15,000,000

8,110,000

5,900,000

380,000

29,390,000

 
 
 
44,156,000

Gold equivalent ounces sold
 
 
 
 
 
124,000

90,000

214,000


Costs applicable to sales per ounce guidance
$9.25 - $9.75
$10.75 - $11.25
$14.00 - $14.50
 
 
$800 - $850
$775 - $825
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
$
491,270

Treatment and refining costs
 
 
 
 
 
 
 
 
4,300

Sustaining capital, including capital lease payments
 
 
 
 
 
 
88,000

General and administrative
 
 
 
 
 
 
 
 
30,000

Exploration
 
 
 
 
 
 
 
 
24,000

Reclamation
 
 
 
 
 
 
 
 
14,000

Project/pre-development costs
 
 
 
 
 
 
 
 
5,700

All-in sustaining costs
 
 
 
 
 
 
 
 
$
657,270

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
29,390,000

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
14,766,000

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
44,156,000

All-in sustaining costs per silver equivalent ounce guidance
 
 
 
 
 
$14.50 - $15.00











27


Reconciliation of All-in Sustaining Costs per Silver Equivalent Ounce
for 2016 Guidance
 
Silver
Gold
 
In thousands except per ounce amounts
Palmarejo
Rochester
San Bartolomé
Endeavor
Total Silver
Kensington
Wharf
Total Gold
Total Combined
Costs applicable to sales, including amortization (U.S. GAAP)
$
130,000

$
120,000

$
87,000

$
2,500

$
339,500

$
137,000

$
82,000

$
219,000

$
558,500

Amortization
40,000

28,000

7,000

1,000

76,000

37,000

20,000

57,000

133,000

Costs applicable to sales
$
90,000

$
92,000

$
80,000

$
1,500

$
263,500

$
100,000

$
62,000

$
162,000

$
425,500

Silver equivalent ounces sold
9,105,000

8,430,000

5,700,000

220,000

23,455,000

 
 
 
36,955,000

Gold equivalent ounces sold
 
 
 
 
 
125,000

100,000

225,000

 
Costs applicable to sales per ounce guidance
$9.75-$10.25
$10.40-$11.35
$13.50-$14.25
 
 
$775-$825
$600-$650
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs applicable to sales
 
 
 
 
 
 
 
 
$
425,500

Treatment and refining costs
 
 
 
 
 
 
 
 
4,500

Sustaining capital, including capital lease payments
 
 
 
 
 
 
75,000

General and administrative
 
 
 
 
 
 
 
 
30,000

Exploration
 
 
 
 
 
 
 
 
15,000

Reclamation
 
 
 
 
 
 
 
 
16,000

Project/pre-development costs
 
 
 
 
 
 
 
 
5,000

All-in sustaining costs
 
 
 
 
 
 
 
 
$
571,000

Silver equivalent ounces sold
 
 
 
 
 
 
 
 
23,455,000

Kensington and Wharf silver equivalent ounces sold
 
 
 
 
 
16,085,250

Consolidated silver equivalent ounces sold
 
 
 
 
 
 
 
39,540,250

All-in sustaining costs per silver equivalent ounce guidance
 
 
 
 
 
$14.25-$14.75

























28