UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 8-K CURRENT REPORT
Pursuant to Section 13 or 15(d) of the |
Date of Report: March 03, 2014
(Date of earliest event reported)
Stillwater Mining Company
(Exact name of registrant as specified in its charter)
DE
(State or other jurisdiction
of incorporation)
001-13053
(Commission File Number)
81-0480654
(IRS Employer
Identification Number)
1321 Discovery Drive, Billings, Montana
(Address of principal executive offices)
59102
(Zip Code)
(406) 373-8700
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, if changed since last report)
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Item 2.02. Results of Operations and Financial Condition On March 3, 2014, Stillwater Mining Company issued a press release reporting the Company's fourth quarter and 2013 results. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Dated: March 03, 2014 |
STILLWATER MINING COMPANY
By: /s/ Brent R. Wadman |
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| Exhibit No. | Description |
| 99.1 | Press Release of Stillwater Mining Company dated March 03, 2014 |
Achieves Record Revenue and Recycling PGM Ounces; Improves 2014 Guidance
BILLINGS, MT -- (Marketwired - March 03, 2014) - STILLWATER MINING COMPANY (NYSE: SWC) (TSX: SWC.U)
Stillwater Mining Company today reported record revenues for 2013 of $1.04 billion, an increase of 29.9% compared to 2012 revenues of $800.2 million. The increase in total revenues reflects higher year-over-year PGM prices, as well as increased mine sales volumes and significantly higher volume of recycled material in 2013.
The Company reported a consolidated net loss attributable to common stockholders of $270.2 million or $2.28 per share for 2013. The result includes a $290.4 million (before-tax) impairment charge recorded in third quarter of 2013 for the Altar mineral property in Argentina, reducing the carrying value to its estimated fair market value of $102.0 million. In addition, during the fourth quarter, the Company recorded a $171.4 million (before-tax) impairment of its Marathon properties in Canada, reducing the carrying value of Marathon to the estimated fair market value of $57.2 million. The after-tax effects on consolidated net loss attributable to common stockholders for the Altar and Marathon impairments were reductions of $226.5 million and $93.2 million, respectively. Adjusted for these impairments, after-tax consolidated net income attributable to common stockholders would have been approximately $49.5 million for 2013, compared to $55.0 million in 2012.
Commenting on the results, Mick McMullen, the Company's President and Chief Executive Officer, stated, "The fourth quarter results reflect the initial progress we are making on our strategic priorities. We achieved record-level revenues for the year, reflecting our position as a world-class provider of PGM materials, and we also achieved a record year in our recycling segment. We are making progress on our goals of maximizing high margin production ounces and optimizing the performance of our metallurgical facilities. After just a short time as Stillwater's CEO, I am pleased with the rapid progress we are making and believe we can further improve our all-in sustaining costs. We exited 2013 on solid financial footing and improved flexibility with reduced debt levels and a superior liquidity profile.
"Moving forward, we are keenly focused on maximizing the value of output from the Montana mines, our core assets, while improving productivity and reducing production costs. Our capital allocation priorities are focused on strong payback projects and optimizing the capital structure in a manner that we believe will quickly create significant, sustainable value to shareholders. Based on the strong end to 2013 combined with the positive progress we are making year-to-date on our strategic priorities, we have elected to update and improve our previously provided financial guidance."
2014 Guidance:
2014 Guidance
Mined Production (palladium and platinum ounces) 520,000 - 535,000
Total Cash Cost per Mined Ounce (net of by-product and
recycling credits) $540 - $590
All-In Sustaining Cost per Mined Ounce $805 - $855
Corporate Overhead (millions) $35 - $45
Capital Expenditures (millions) $145 - $155
Sustaining Capital Expenditures $97 - $103
Project Capital Expenditures $48 - $52
For the year ended December 31, 2013, the Company's Montana mines produced a total of 523,900 ounces of palladium and platinum compared to mine production of 513,700 combined ounces in 2012.
2013 Mine Production by Quarter:
First Second Third Fourth
(Produced ounces) Quarter Quarter Quarter Quarter Year 2013
-------------------------- --------- --------- --------- --------- ---------
Stillwater Mine 92,600 91,000 83,800 98,700 366,100
Palladium 71,300 70,200 64,500 75,900 281,900
Platinum 21,300 20,800 19,300 22,800 84,200
East Boulder Mine 34,500 40,500 40,400 42,400 157,800
Palladium 26,800 31,500 31,200 32,800 122,300
Platinum 7,700 9,000 9,200 9,600 35,500
Total 127,100 131,500 124,200 141,100 523,900
Palladium 98,100 101,700 95,700 108,700 404,200
Platinum 29,000 29,800 28,500 32,400 119,700
Revenue from the Company's Mine Production segment for the fourth quarter of 2013 (including proceeds from the sale of by-products) totaled $114.7 million, a 0.7% decrease from $115.5 million in the same period of 2012. Combined sales realizations for mined palladium and platinum were essentially flat for the fourth quarter of 2013, averaging $869 per mined ounce, compared to $867 per mined ounce realized in the fourth quarter of 2012. The total quantity of mined palladium and platinum ounces sold in the fourth quarter of 2013 was 125,000 ounces, essentially unchanged from the same period in 2012. Sales ounces were less than production during the quarter due to timing differences in inventory flows.
The Company processed recycling material containing 120,000 ounces of palladium, platinum and rhodium through its smelter and refinery during the fourth quarter of 2013. This represents an increase of 1.2% over the total of 118,600 ounces processed during the fourth quarter of 2012. For the year ended December 31, 2013, the Company processed a record 616,700 ounces of recycled PGMs, a 38.5% increase from approximately 445,200 ounces processed during the same period of 2012. The increased volumes in 2013 were attributable to the addition of new suppliers of recycling material and ounces attributable to recycling from the reprocessing of furnace brick from the Company's own smelting facility.
2013 Recycling Activity by Quarter:
First Second Third Fourth 2013
Quarter Quarter Quarter Quarter Full-Year
-------------------------- --------- --------- --------- --------- ---------
Average tons of catalyst
fed per day 26.0 28.4 27.2 20.3 25.4
PGM ounces fed 154,200 175,000 167,500 120,000 616,700
PGM ounces sold 116,900 143,100 152,600 129,200 541,800
PGM toll ounces returned 14,400 25,500 8,000 17,500 65,400
Recycling sales volumes for the fourth quarter of 2013 increased by 49.2%, to 129,200 ounces from 86,600 ounces sold in the fourth quarter of 2012. PGM Recycling revenue totaled $127.7 million for the 2013 fourth quarter, a 45.3% increase from the $87.9 million in the same period of 2012. The Company's combined average realized price for sales of recycled palladium, platinum and rhodium decreased to $985 per ounce in the fourth quarter of 2013 from $1,012 per ounce in the fourth quarter of 2012.
Combined total cash costs per mined ounce, net of by-product and recycling credits, (a non-GAAP measure) averaged $496 per ounce for the year ended December 31, 2013. See - "Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues." Note that, for historical reasons, the Company's measurement of total cash costs per mined ounce customarily has been reported net of credits for sales of by-products from mining and also net of PGM Recycling segment margins. During the third quarter of 2013, the Company received significant revenue from the sale of PGM ounces recovered from used furnace brick attributable to recycling, which resulted in significantly higher than normal levels of PGM Recycling segment credits during 2013. These larger than normal PGM Recycling segment credits offset a portion of the growth in total cash costs per mined ounce for the full year 2013. Please see - "Current Operations - Reprocessing of Furnace Brick," in the Company's 2013 Form 10-K for further details. The table below illustrates the effect of by-product and recycling credits on the average cash costs per mined ounce net of credits for the combined Montana mining operations.
2013 2012
Combined Montana Mining Operations Fourth Fourth 2013 2012
Cash Costs Per Mined Ounce Quarter Quarter Full-Year Full-Year
------------------------------------ --------- --------- --------- ---------
Reported Total Cash Costs per Mined
Ounce (Net of Credits) * $ 500 $ 475 $ 496 $ 484
Add: By-Product Revenue Credit 43 54 52 60
Add: PGM Recycling Income Credit 25 20 68 21
--------- --------- --------- ---------
Total Cash Costs per Mined Ounce
(Before Credits) * $ 568 $ 549 $ 616 $ 565
========= ========= ========= =========
* These are non-GAAP measures. For a full description and reconciliation of these and other non-GAAP measures to GAAP accounting measures, see Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues and the accompanying discussion in the Company's 2013 Annual Report on Form 10-K.
The Company is also now utilizing another, broader non-GAAP measure of mining efficiency, All-In Sustaining Cost, in monitoring and managing its performance going forward. This non-GAAP measure starts with total cash costs net of credits and adds back the recycling credit, plus corporate general and administrative costs (before depletion, depreciation and amortization) and capital outlays directed toward sustaining operations at the Company's operating mines. The resulting measure provides a comparative indication of the all-in resources consumed in any period to sustain the mining operations and produce at current levels.
Combined Montana Mining Operations 2013 2012
All-In Sustaining Cost Per Mined Fourth Fourth 2013 2012
Ounce Quarter Quarter Full-Year Full-Year
------------------------------------ --------- --------- --------- ---------
Reported Total Cash Costs per Mined
Ounce (Net of Credits) * $ 500 $ 475 $ 496 $ 484
Add Back PGM Recycling Income Credit 25 20 68 21
Add Corporate General &
Administrative Costs (Before DD&A) 49 92 88 101
Add Capital Outlays at the Montana
Operating Mines 196 190 181 162
--------- --------- --------- ---------
All-In Sustaining Cost Per Mined
Ounce $ 770 $ 777 $ 833 $ 768
========= ========= ========= =========
* These are non-GAAP measures. For a full description and reconciliation of these and other non-GAAP measures to GAAP accounting measures, please see Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues and the accompanying discussion in the Company's 2013 Annual Report on Form 10-K.
Cash Flow and Liquidity
At December 31, 2013, the Company's consolidated available cash balance was $286.7 million, compared to $379.7 million at December 31, 2012. If highly liquid investments are included with available cash, the Company's balance sheet liquidity totaled $496.0 million at December 31, 2013, a decrease from $641.7 million at December 31, 2012. Most of this decrease resulted from redeeming $164.3 million of convertible debt in March of 2013. Of the Company's year-end 2013 consolidated cash balance, $24.3 million was dedicated to the Marathon project (and other related Canadian properties) and is unavailable for other corporate purposes. Net working capital -- comprised of total current assets (including available cash and investments), less current liabilities -- increased to $614.8 million at December 31, 2013, from $606.0 million at the end of 2012.
Net cash provided by operating activities (which includes changes in working capital) totaled $149.4 million for the year ended December 31, 2013, compared to $103.9 million of cash provided for the same period of 2012. The growth in cash from operations for the year ended December 31, 2013 was largely driven by lower year-end recycling advances and higher non-cash interest expense associated with the 1.75% convertible debentures. Capital expenditures were $129.0 million for the year ended December 31, 2013, compared to $112.1 million in the same period of 2012. Of the capital expenditures for the year ended December 31, 2013, $93.9 million was attributable to ongoing investments in the Montana mines and processing facility. Year-to-date capital expenditures include $22.6 million attributable to the major developments underway along the J-M Reef in Montana, (Blitz and Graham Creek developments).
Outstanding balance sheet debt at December 31, 2013, was $310.7 million, down from $461.1 million at December 31, 2012. The Company's reported debt balance currently includes $274.0 million of 1.75% convertible debentures and $2.2 million of 1.875% convertible debentures, $29.6 million of exempt facility revenue bonds, a capital lease of $4.6 million and $0.3 million of financing for a small installment land purchase.
Other Matters
Notwithstanding the accounting impairment charge recorded in the third quarter of 2013, the Company is reviewing alternatives to optimize the value of its investment in the Altar project in Argentina. Some minimum level of annual expenditures will be required in order to maintain the Company's good standing and preserve its asset position at Altar. Future levels of exploration spending at Altar are discretionary and will be evaluated year by year.
The Company is currently completing a final feasibility study and an updated economic assessment of the Marathon PGM-copper project in Canada. As was announced previously, the initial findings of the feasibility study indicate that changes to the design and scale of the project will be required if the project is to achieve acceptable economic returns. Because these changes are likely to modify the environmental scope of the project, the joint federal and provincial panel responsible for reviewing the environmental impacts of the project has agreed to suspend its review activities until the final project scope is determined. At this stage, it is not yet clear if the scope changes being evaluated will be adequate to result in acceptable project economics. If an alternative project scope does result in an economically viable project, significant additional evaluation and design work will be required prior to any future decision to proceed with construction at Marathon.
Fourth Quarter Results - Details
For the fourth quarter of 2013, the Company's Stillwater Mine produced 98,700 ounces of palladium and platinum, an increase of 1.2% from the 97,500 ounces produced in the fourth quarter of 2012. Production at the Company's East Boulder Mine of 42,400 ounces in the fourth quarter of 2013 reflected an increase of 21.1% over the 35,000 ounces produced in the same quarter of 2012.
Costs of metals sold (before depletion, depreciation and amortization expense) increased to $201.4 million in the fourth quarter of 2013 from $155.6 million in the fourth quarter of 2012. Mine Production costs included in costs of metals sold increased to $76.9 million in the 2013 fourth quarter from $70.0 million in the 2012 fourth quarter. PGM Recycling costs, which primarily reflect the cost of acquiring spent catalytic materials for processing, totaled $124.5 million in the fourth quarter of 2013, significantly more than the $85.6 million reported in the fourth quarter of 2012. The increase was due to higher volumes sold and the associated higher total market value of the materials acquired for processing.
General and administrative costs were $6.1 million in the fourth quarter of 2013, down from the $8.9 million incurred during the same period of 2012. The decrease was primarily due to lower share-based compensation costs following vesting associated with the technical change in control in the second quarter of 2013. Exploration expenses were $0.9 million in the fourth quarter of 2013 compared to $1.2 million, in the same period of 2012. Marketing expenses declined to $0.2 million in the 2013 fourth quarter compared to $3.3 million in the same quarter of 2012, reflecting the curtailment of palladium jewelry marketing efforts in 2013.
Interest expense reported for the fourth quarter of 2013 and 2012 was $5.3 million and $6.6 million, respectively. This decrease is due in part to the pay down on the outstanding debt associated with the 1.875% convertible earlier in the year, offset by interest expense related to the 1.75% convertible debentures, including the accretion of the debt discount that is charged to earnings over the expected life of the convertible debentures and offset by capitalized interest recognized as a cost of the Company's ongoing projects.
During the fourth quarter of 2013, the Company recorded a net foreign currency transaction gain of $2.5 million, primarily related to the deferred tax liability recorded in association with the acquisition of Peregrine Metals Ltd. The net foreign currency transaction gain recorded for the fourth quarter of 2012 was $2.2 million.
2013 Full-Year Results - Details
For the year ended December 31, 2013, the Company's Stillwater Mine produced 366,100 ounces of palladium and platinum, a decrease of 3.0% from the 377,400 ounces produced in the same period of 2012. Production at the Company's East Boulder Mine of 157,800 ounces for the year ended December 31, 2013 reflected a 15.8% increase from the 136,300 ounces produced in the same period of 2012. During 2013 the Stillwater Mine experienced unexpected negative fluctuations in ore grade delivered to the mill, a challenge that was largely offset by better-than-expected ore grades realized at the East Boulder Mine. The 2013 ore quality variances at Stillwater Mine appear to have been isolated and not indicative of a longer-term issue and by the last two months of 2013, actual ore grades were above budgeted ore grades.
Costs of metals sold (before depletion, depreciation and amortization expense) increased to $841.3 million for the year ended December 31, 2013 from $623.9 million in the same period of 2012. Mine Production costs included in costs of metals sold increased to $314.0 million for the year ended December 31, 2013 from $288.9 million in the same period of 2012. PGM Recycling costs, which primarily reflect the cost of acquiring spent catalytic materials for processing, totaled $527.4 million for the year ended December 31, 2013, more than the $334.9 million reported in the same period of 2012. The increase was due to higher volumes sold and the related higher total cost to acquire materials for processing.
General and administrative costs were $42.0 million for the year ended December 31, 2013, up from the $40.9 million incurred during the same period of 2012. The Company recognized $11.2 million in total exploration expenses related to its mineral properties in both Canada and South America for the year ended December 31, 2013 and $15.0 million in the same period of 2012. Marketing expenses declined to $4.4 million for the year ended December 31, 2013 compared to $11.2 million in the same time period of 2012, reflecting the curtailment of marketing palladium for jewelry in 2013. As a result of the proxy contest and the change in control provisions in the Company's employee and director equity incentive plans, the Company recognized costs of $4.3 million and $9.1 million (non-cash), respectively, for the year ended December 31, 2013. These costs were incurred during the first and second quarters of 2013.
Interest expense reported for the year ended December 31, 2013, and 2012 was $23.0 million and $10.9 million, respectively. This increase is principally the result of the interest expense related to the 1.75% convertible debentures, including the accretion of the debt discount that is charged to earnings over the expected life of the convertible debentures and offset by capitalized interest recognized as a cost of the Company's ongoing projects.
During the years ended December 31, 2013 and 2012, the Company recorded a net foreign currency transaction gain of $18.2 million and $15.2 million, respectively. Approximately $17.4 million and $15.4 million of the 2013 and 2012 net gain, respectively, related to the remeasurement into U.S. dollars of the deferred taxes recorded in association with the acquisition of Peregrine Metals Ltd. The gain reflects the result of high inflation in Argentina as the obligation is remeasured from Argentine pesos into U.S. dollars.
2013 Results Webcast and Conference Call
Stillwater Mining Company will conduct a conference call to discuss 2013 results at 12:00 noon Eastern Standard Time on Monday, March 3, 2014.
Dial-In Numbers:
United States: (800) 288-9626
International: (612) 332-0228
The conference call will be simultaneously webcast through the Company's website at www.stillwatermining.com in the Investor Relations section.
A telephone replay of the call will be available for one week following the event. The replay dial-in numbers are (800) 475-6701 (U.S.) and (320) 365-3844 (International), access code 319541. In addition, the call transcript will be archived in the Investor Relations section of the Company's website.
About Stillwater Mining Company
Headquartered in Billings, Montana, Stillwater Mining Company is the only U.S. producer of platinum group metals (PGMs) and the largest primary producer of PGMs outside of South Africa and the Russian Federation. PGMs are rare precious metals used in a wide variety of applications, including auto catalysts, fuel cells, hydrogen purification, electronics, jewelry, dentistry, medicine, coinage and other uses. Stillwater Mining Company is engaged in the development, extraction, processing, smelting and refining of PGMs from a geological formation in southern Montana known as the J-M Reef. This is the only known significant source of PGMs in the United States and one of the highest grade PGM resources in the world. The Company also owns the Marathon PGM-copper deposit in Ontario, Canada and the Altar porphyry copper-gold deposit located in the San Juan province of Argentina. The Company's shares are traded on the New York Stock Exchange under the symbol SWC and on the Toronto Stock Exchange under the symbol SWC.U. Information about Stillwater Mining Company can be found at its website: www.stillwatermining.com
Some statements contained in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, therefore, involve uncertainties or risks that could cause actual results to differ materially. These statements may contain words such as "desires," "believes," "anticipates," "plans," "expects," "intends," "estimates" or similar expressions. Such statements also include, but are not limited to, comments regarding guidance; expansion plans, costs, grade, production and recovery rates; permitting; financing needs and the terms of future credit facilities; exchange rates; capital expenditures; increases in processing capacity; cost reduction measures; safety; timing for engineering studies; environmental permitting and compliance; litigating; labor matters; and the palladium, platinum, copper and gold market. These statements are not guarantees of the Company's future performance and are subject to risks, uncertainties and other important factors that could cause its actual performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Additional information regarding factors that could cause results to differ materially from management's expectations is found in the section entitled "Risk Factors" in the Company's 2013 Annual Report on Form 10-K, in its quarterly Form 10-Q filings, and in corresponding filings with Canadian securities regulatory authorities.
The Company intends that the forward-looking statements contained herein be subject to the above-mentioned statutory safe harbors. Investors are cautioned not to rely on forward-looking statements. The Company disclaims any obligation to update forward-looking statements.
Stillwater Mining Company
Consolidated Statements of Comprehensive (Loss) Income
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------- ---------------------
(In thousands, except per share
data) 2013 2012 2013 2012
------------------------------- --------- --------- ---------- ---------
REVENUES
Mine Production $ 114,669 $ 115,475 $ 478,918 $ 455,426
PGM Recycling 127,691 87,899 560,588 344,818
--------- --------- ---------- ---------
Total revenues 242,360 203,374 1,039,506 800,244
COSTS AND EXPENSES
Costs of metals sold
Mine Production 76,921 69,987 313,963 288,922
PGM Recycling 124,525 85,589 527,384 334,949
--------- --------- ---------- ---------
Total costs of metals
sold (excludes
depletion, depreciation
and amortization) 201,446 155,576 841,347 623,871
Depletion, depreciation and
amortization
Mine Production 14,377 14,112 58,201 56,960
PGM Recycling 312 262 1,116 1,055
--------- --------- ---------- ---------
Total depletion,
depreciation and
amortization 14,689 14,374 59,317 58,015
--------- --------- ---------- ---------
Total costs of revenues 216,135 169,950 900,664 681,886
Marketing 158 3,296 4,355 11,170
Exploration 922 1,225 11,169 15,010
Research and development 45 295 237 1,159
Proxy contest expense - - 4,307 -
Accelerated equity based
compensation expense - - 9,063 -
General and administrative 6,139 8,921 41,985 40,948
Loss on inventory purchases - 140 - 590
Loss on long-term investments 128 865 1,894 2,562
Impairment of non-producing
mineral properties and
property, plant and
equipment 171,338 - 461,755 -
Abandonment of non-producing
property - - - 2,835
Loss on trade receivables 632 - 632 -
(Gain)/Loss on disposal of
property, plant and
equipment (38) 85 68 448
--------- --------- ---------- ---------
Total costs and
expenses 395,459 184,777 1,436,129 756,608
OPERATING (LOSS) INCOME (153,099) 18,597 (396,623) 43,636
OTHER INCOME (EXPENSE)
Other 3 (486) 1,173 181
Interest income 965 619 4,481 2,325
Interest expense (5,311) (6,559) (22,957) (10,920)
Foreign currency transaction
gain, net 2,521 2,174 18,200 15,155
--------- --------- ---------- ---------
(LOSS) INCOME BEFORE INCOME TAX
BENEFIT (154,921) 14,345 (395,726) 50,377
Income tax benefit 46,185 2,531 93,653 4,039
--------- --------- ---------- ---------
NET (LOSS) INCOME $(108,736) $ 16,876 $ (302,073) $ 54,416
--------- --------- ---------- ---------
Net (loss) income attributable
to noncontrolling interest (30,750) 2 (31,867) (629)
--------- --------- ---------- ---------
NET (LOSS) INCOME ATTRIBUTABLE
TO COMMON STOCKHOLDERS $ (77,986) $ 16,874 $ (270,206) $ 55,045
--------- --------- ---------- ---------
Other comprehensive (loss)
income, net of tax
Net unrealized (loss)/gains
on securities available-for-
sale (183) 242 105 862
--------- --------- ---------- ---------
COMPREHENSIVE (LOSS) INCOME
ATTRIBUTABLE TO COMMON
STOCKHOLDERS $ (78,169) $ 17,116 $ (270,101) $ 55,907
--------- --------- ---------- ---------
Comprehensive (loss) income
attributable to noncontrolling
interest (30,750) 2 (31,867) (629)
--------- --------- ---------- ---------
TOTAL COMPREHENSIVE (LOSS)
INCOME $(108,919) $ 17,118 $ (301,968) $ 55,278
========= ========= ========== =========
Weighted average common shares
outstanding
Basic 119,381 116,888 118,607 116,162
Diluted 119,381 153,974 118,607 131,441
Basic (loss) earnings per share
attributable to common
stockholders $ (0.65) $ 0.14 $ (2.28) $ 0.47
Diluted (loss) earnings per
share attributable to common
stockholders $ (0.65) $ 0.13 $ (2.28) $ 0.46
========= ========= ========== =========
Stillwater Mining Company
Consolidated Balance Sheets
December 31, December 31,
(In thousands, except per share data) 2013 2012
---------------------------------------------- ------------- -------------
ASSETS
Current assets
Cash and cash equivalents $ 286,687 $ 379,680
Investments, at fair market value 209,338 261,983
Inventories 158,650 153,208
Trade receivables 8,988 9,953
Deferred income taxes 21,547 21,304
Prepaids 3,912 5,020
Other current assets 14,757 21,714
------------- -------------
Total current assets 703,879 852,862
Mineral properties 159,252 576,359
Mine development, net 346,346 322,866
Property, plant and equipment, net 124,731 122,677
Deferred debt issuance costs 7,945 9,609
Other noncurrent assets 4,527 6,390
------------- -------------
Total assets $ 1,346,680 $ 1,890,763
============= =============
LIABILITIES AND EQUITY
Current liabilities
Accounts payable $ 32,088 $ 28,623
Accrued compensation and benefits 30,646 31,369
Property, production and franchise taxes
payable 14,495 13,722
Current portion of long-term debt and capital
lease obligations 2,035 168,432
Income taxes payable 4,416 -
Other current liabilities 5,368 4,702
------------- -------------
Total current liabilities 89,048 246,848
Long-term debt and capital lease obligations 308,667 292,685
Deferred income taxes 79,159 199,802
Accrued workers compensation 6,031 5,815
Asset retirement obligation 8,654 7,965
Other noncurrent liabilities 7,262 5,068
------------- -------------
Total liabilities 498,821 758,183
------------- -------------
EQUITY
Stockholders' equity
Preferred stock, $0.01 par value, 1,000,000
shares authorized; none issued - -
Common stock, $0.01 par value, 200,000,000
shares authorized; 119,466,449 and
116,951,081 shares issued and outstanding 1,195 1,170
Paid-in capital 1,076,200 1,058,978
Accumulated (deficit) earnings (249,436) 20,770
Accumulated other comprehensive income (loss) 6 (99)
------------- -------------
Total stockholders' equity 827,965 1,080,819
------------- -------------
Noncontrolling interest 19,894 51,761
------------- -------------
Total equity 847,859 1,132,580
------------- -------------
Total liabilities and equity $ 1,346,680 $ 1,890,763
============= =============
Stillwater Mining Company
Consolidated Statements of Cash Flows
Twelve Months Ended
December 31,
--------------------
(In thousands) 2013 2012
------------------------------------------------------ --------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income $(302,073) $ 54,416
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depletion, depreciation and amortization 59,317 58,015
Loss on inventory purchases - 590
Loss on trade receivables 632 -
Loss on disposal of property, plant and equipment 68 448
Impairment of non-producing mineral properties and
property, plant and equipment 461,755 -
Abandonment of non-producing property - 2,835
Loss on long-term investments 1,894 2,562
Amortization/accretion on investment
premium/discount 3,079 900
Deferred taxes (108,543) (3,937)
Foreign currency transaction gain, net (18,200) (15,155)
Accretion of asset retirement obligation 689 634
Amortization of debt issuance costs 1,664 1,495
Accretion of convertible debenture debt discount 15,783 3,097
Accelerated equity based compensation expense 9,063 -
Share based compensation and other benefits 15,242 16,369
Non-cash capitalized interest (2,878) -
Changes in operating assets and liabilities:
Inventories (4,252) (19,958)
Trade receivables 333 (3,765)
Prepaids 1,108 39
Accrued compensation and benefits (723) 3,575
Accounts payable 3,187 (1,772)
Property, production and franchise taxes payable 2,006 (970)
Income taxes payable 4,416 (1,235)
Workers compensation 216 (241)
Restricted cash - 25,035
Excess tax benefit from stock-based compensation (2,756) (7,737)
Other operating assets 6,790 (2,250)
Other operating liabilities 1,616 (9,096)
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 149,433 103,894
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (129,029) (112,071)
Proceeds from disposal of property, plant and
equipment 218 222
Purchases of investments (151,567) (280,273)
Proceeds from maturities of investments 201,255 67,314
--------- ---------
NET CASH USED IN INVESTING ACTIVITIES (79,123) (324,808)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of noncontrolling interest, net
of transaction costs - 93,821
Excess tax benefit from stock-based compensation 2,756 7,737
Issuance of long-term debt - 403,926
Payments on debt and capital lease obligations (166,187) (1,394)
Payments for debt issuance costs - (12,637)
Issuance of common stock 128 44
--------- ---------
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (163,303) 491,497
--------- ---------
CASH AND CASH EQUIVALENTS
Net increase (decrease) (92,993) 270,583
Balance at beginning of period 379,680 109,097
--------- ---------
BALANCE AT END OF PERIOD $ 286,687 $ 379,680
========= =========
Stillwater Mining Company
Key Operating Factors
(Unaudited)
Three Months Twelve Months
Ended December Ended December
31, 31,
----------------- -----------------
(In thousands, except where noted) 2013 2012 2013 2012
---------------------------------------- -------- -------- -------- --------
OPERATING AND COST DATA FOR MINE
PRODUCTION
Consolidated:
Ounces produced
Palladium 109 98 404 396
Platinum 32 35 120 118
-------- -------- -------- --------
Total 141 133 524 514
======== ======== ======== ========
Tons milled 299 281 1,201 1,081
Mill head grade (ounce per ton) 0.51 0.51 0.47 0.51
Sub-grade tons milled (1) 17 20 73 69
Sub-grade tons mill head grade (ounce
per ton) 0.17 0.14 0.17 0.16
Total tons milled(1) 316 301 1,274 1,150
Combined mill head grade (ounce per ton) 0.49 0.49 0.45 0.49
Total mill recovery (%) 92 92 92 92
Total mine concentrate shipped (tons)
(3) 7,308 6,246 28,669 23,843
Platinum grade in concentrate (ounce per
ton) (3) 4.65 5.02 4.50 5.17
Palladium grade in concentrate (ounce
per ton) (3) 15.28 16.80 14.59 17.15
Total cash costs per ounce - net of
credits (Non-GAAP) (2) $ 500 $ 475 $ 496 $ 484
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) $ 223 $ 209 $ 204 $ 216
Stillwater Mine:
Ounces produced
Palladium 76 75 282 290
Platinum 23 23 84 88
-------- -------- -------- --------
Total 99 98 366 378
======== ======== ======== ========
Tons milled 186 176 765 673
Mill head grade (ounce per ton) 0.57 0.60 0.51 0.60
Sub-grade tons milled (1) 7 10 36 36
Sub-grade tons mill head grade (ounce
per ton) 0.26 0.20 0.23 0.21
Total tons milled (1) 193 186 801 709
Combined mill head grade (ounce per ton) 0.55 0.58 0.50 0.58
Total mill recovery (%) 93 92 92 92
Total mine concentrate shipped (tons)
(3) 4,253 3,600 16,975 13,645
Platinum grade in concentrate (ounce per
ton) (3) 5.73 6.41 5.22 6.71
Palladium grade in concentrate (ounce
per ton) (3) 18.50 21.33 17.12 21.94
Total cash costs per ounce - net of
credits (Non-GAAP) (2) $ 469 $ 453 $ 484 $ 456
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) $ 240 $ 238 $ 221 $ 243
Stillwater Mining Company
Key Operating Factors (Continued)
(Unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
(In thousands, except where noted) 2013 2012 2013 2012
---------------------------------------- -------- -------- -------- --------
OPERATING AND COST DATA FOR MINE
PRODUCTION (Continued)
East Boulder Mine:
Ounces produced
Palladium 33 27 122 106
Platinum 9 8 36 30
-------- -------- -------- --------
Total 42 35 158 136
======== ======== ======== ========
Tons milled 114 104 436 408
Mill head grade (ounce per ton) 0.41 0.37 0.40 0.37
Sub-grade tons milled (1) 9 11 37 33
Sub-grade tons mill head grade (ounce
per ton) 0.10 0.09 0.10 0.10
Total tons milled (1) 123 115 473 441
Combined mill head grade (ounce per ton) 0.39 0.34 0.37 0.35
Total mill recovery (%) 90 90 90 90
Total mine concentrate shipped (tons)
(3) 3,055 2,646 11,694 10,198
Platinum grade in concentrate (ounce per
ton) (3) 3.16 3.12 3.45 3.12
Palladium grade in concentrate (ounce
per ton) (3) 10.80 10.65 10.93 10.74
Total cash costs per ounce - net of
credits (Non-GAAP) (2) $ 573 $ 537 $ 525 $ 562
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) $ 198 $ 163 $ 175 $ 174
(1) Sub-grade tons milled includes reef waste material only. Total tons
milled includes ore tons and sub-grade tons only. See "Proven and
Probable Ore Reserves - Discussion" in the Company's 2013 Annual
Report on Form 10-K for further information.
(2) Total cash costs include total operating costs plus royalties,
insurance and taxes other than income taxes. Income taxes, corporate
general and administrative expenses, asset impairment write-downs,
gain or loss on disposal of property, plant and equipment,
restructuring costs and interest income and expense are not included
in total cash costs. Cash costs per ton and cash costs per ounce, are
non-GAAP measurements that management uses to monitor and evaluate the
efficiency of its mining operations. These measures of cost are not
defined under U.S. Generally Accepted Accounting Principles (GAAP).
Please see "Reconciliation of Non-GAAP Measures to Consolidated Costs
of Revenues" and the accompanying discussion for additional detail.
(3) The concentrate tonnage and grade values are inclusive of periodic re-
processing of smelter slag and brick PGM bearing materials.
Stillwater Mining Company
Key Operating Factors (Continued)
(Unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
---------------------------------------- ----------------- -----------------
(In thousands, except for average
prices) 2013 2012 2013 2012
---------------------------------------- -------- -------- -------- --------
SALES AND PRICE DATA
Ounces sold
Mine Production:
Palladium (oz.) 98 96 398 386
Platinum (oz.) 27 29 111 114
-------- -------- -------- --------
Total 125 125 509 500
-------- -------- -------- --------
PGM Recycling: (1)
Palladium (oz.) 76 47 306 192
Platinum (oz.) 42 33 192 119
Rhodium (oz.) 11 6 44 25
-------- -------- -------- --------
Total 129 86 542 336
-------- -------- -------- --------
By-products from Mine Production: (2)
Rhodium (oz.) 1 1 3 4
Gold (oz.) 2 2 9 9
Silver (oz.) 1 2 5 6
Copper (lb.) 258 173 903 742
Nickel (lb.) 310 284 1,350 1,120
Average realized price per ounce(3)
Mine Production:
Palladium ($/oz.) $ 723 $ 647 $ 721 $ 641
Platinum ($/oz.) $ 1,395 $ 1,594 $ 1,481 $ 1,551
Combined ($/oz.)(4) $ 869 $ 867 $ 887 $ 849
PGM Recycling: (1)
Palladium ($/oz.) $ 723 $ 628 $ 713 $ 645
Platinum ($/oz.) $ 1,449 $ 1,534 $ 1,526 $ 1,542
Rhodium ($/oz.) $ 980 $ 1,168 $ 1,091 $ 1,377
Combined ($/oz.)(4) $ 985 $ 1,012 $ 1,031 $ 1,018
By-products from Mine Production: (2)
Rhodium ($/oz.) $ 931 $ 1,074 $ 1,047 $ 1,258
Gold ($/oz.) $ 1,271 $ 1,694 $ 1,394 $ 1,667
Silver ($/oz.) $ 20 $ 32 $ 24 $ 31
Copper ($/lb.) $ 3.08 $ 3.42 $ 3.14 $ 3.42
Nickel ($/lb.) $ 5.19 $ 6.63 $ 5.47 $ 6.74
Average market price per ounce(3)
Palladium ($/oz.) $ 726 $ 650 $ 725 $ 643
Platinum ($/oz.) $ 1,400 $ 1,603 $ 1,487 $ 1,551
Combined ($/oz.)(4) $ 873 $ 872 $ 891 $ 850
(1) Ounces sold and average realized price per ounce from PGM Recycling
relate to ounces produced from processing of catalyst materials.
(2) By-product metals sold reflect contained metal produced from mined ore
alongside the Company's primary production of palladium and platinum.
Realized prices reflect net values (discounted due to product form and
transportation and marketing charges) per unit received.
(3) The Company's average realized price represents revenues, which
include the effect of hedging gains and losses realized on commodity
instruments and agreement discounts, divided by ounces sold. The
average market price represents the average London Bullion Market
Association afternoon postings for the actual months of the period.
(4) The Company calculates the combined average realized and a combined
average market price of palladium and platinum using the same ratio as
the rate of ounces of each respective metal that are produced from the
base metal refinery.
Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues
The Company utilizes certain non-GAAP measures as indicators in assessing the performance of its mining and processing operations during any period. Because of the processing time required to complete the extraction of finished PGM products, there are typically lags of one to three months between ore production and sale of the finished product. Sales in any period include some portion of material mined and processed from prior periods as the revenue recognition process is completed. Consequently, while costs of revenues (a GAAP measure included in the Company's Consolidated Statements of Comprehensive (Loss) Income) appropriately reflects the expense associated with the materials sold in any period, the Company has developed certain non-GAAP measures to assess the costs associated with its producing and processing activities in a particular period and to compare those costs between periods.
While the Company believes that these non-GAAP measures may also be of value to outside readers, both as general indicators of the Company's mining efficiency from period to period and as insight into how the Company internally measures its operating performance, these non-GAAP measures are not standardized across the mining industry and in most cases will not be directly comparable to similar measures that may be provided by other companies. These non-GAAP measures are only useful as indicators of relative operational performance in any period, and because they do not take into account the inventory timing differences that are included in costs of revenues, they cannot meaningfully be used to develop measures of earnings or profitability. A reconciliation of these measures to costs of revenues for each period shown is provided as part of the following tables, and a description of each non-GAAP measure is provided below.
Total Consolidated Costs of Revenues: For the Company as a whole, this measure is equal to total costs of revenues, as reported in the Consolidated Statements of Comprehensive (Loss) Income. For the Stillwater Mine, the East Boulder Mine, and other PGM activities, the Company segregates the expenses within total costs of revenues that are directly associated with each of these activities and then allocates the remaining facility costs included in total cost of revenues in proportion to the monthly volumes from each activity. The resulting total costs of revenues measures for the Stillwater Mine, the East Boulder Mine and other PGM activities are equal in total to total consolidated costs of revenues as reported in the Company's Consolidated Statements of Comprehensive (Loss) Income.
Total Cash Costs (Non-GAAP): This non-GAAP measure is calculated as total costs of revenues (for each mine or combined) adjusted to exclude gains or losses on asset dispositions, costs and profit from recycling activities, revenues from the sale of mine by-products, depreciation and amortization and asset retirement costs, and timing differences resulting from changes in product inventories. The Company uses this measure as a comparative indication of the cash costs related to production and processing operations in any period. It is a measure of extraction efficiency.
When divided by the total tons milled in the respective period, Total Cash Cost per Ton Milled (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per ton milled in that period. Because of variability of ore grade in the Company's mining operations, production efficiency underground is frequently measured against ore tons produced rather than contained PGM ounces. Because ore tons are first weighed as they are fed into the mill, mill feed is the first point at which production tons are measured precisely. Consequently, Total Cash Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency, and is affected both by the level of Total Cash Costs (Non-GAAP) and by the volume of tons produced and fed to the mill.
When divided by the total recoverable PGM ounces from production in the respective period, Total Cash Cost per Ounce (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per PGM ounce produced in that period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because ultimately extracting PGM material is the objective of mining, the cash cost per ounce of extracting and processing PGM ounces in a period is a useful measure for comparing extraction efficiency between periods and between the Company's mines. Consequently, Total Cash Cost per Ounce (Non-GAAP) in any period is a general measure of extraction efficiency, and is affected by the level of Total Cash Costs (Non-GAAP), by the grade of the ore produced and by the volume of ore produced in the period.
Stillwater Mining Company
Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------------------- -------------------- --------------------
(In thousands, except per ounce
and per ton data) 2013 2012 2013 2012
-------------------------------- --------- --------- --------- ---------
Consolidated:
Total cash cost before by-
product and recycling credits
(Non-GAAP) $ 80,099 $ 72,714 $ 322,564 $ 290,346
Less: By-product credit (5,982) (7,079) (27,085) (30,642)
Less: Recycling income credit (3,590) (2,681) (35,463) (11,042)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 70,527 $ 62,954 $ 260,016 $ 248,662
Divided by platinum/palladium
ounces produced 141 132 524 514
Total cash cost before by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 568 $ 549 $ 616 $ 565
Less: By-product credit per
ounce Pt/Pd produced (43) (54) (52) (60)
Less: Recycling income credit
per ounce Pt/Pd produced (25) (20) (68) (21)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 500 $ 475 $ 496 $ 484
Divided by ore tons milled 316 301 1,274 1,150
Total cash cost before by-
product and recycling credits
per ore ton milled (Non-GAAP) 253 242 253 252
Less: By-product credit per ore
ton milled (19) (24) (21) (27)
Less: Recycling income credit
per ore ton milled (11) (9) (28) (10)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ore ton milled (Non-GAAP) $ 223 $ 209 $ 204 $ 215
Reconciliation to consolidated
costs of revenues:
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 70,527 $ 62,954 $ 260,016 $ 248,662
Asset retirement costs 177 165 689 635
Depletion, depreciation and
amortization 14,377 14,111 58,201 56,960
Depletion, depreciation and
amortization (in inventory) 1,472 1,534 1,190 1,393
Change in product inventories (4,828) (4,425) (10,480) (3,452)
Cost of PGM Recycling 124,526 85,589 527,384 334,949
PGM Recycling - depreciation 312 262 1,116 1,055
By-product credit 5,982 7,079 27,085 30,642
Profit from PGM Recycling
(before bad debt expense and
gain/loss on asset disposals) 3,590 2,681 35,463 11,042
--------- --------- --------- ---------
Total consolidated cost of
revenues $ 216,135 $ 169,950 $ 900,664 $ 681,886
========= ========= ========= =========
Memo: Royalties, Taxes and Other
included in Total consolidated
cost of revenues $ 10,059 $ 8,571 $ 43,814 $ 39,593
Stillwater Mining Company
Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues
(Continued)
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------------------- -------------------- --------------------
(In thousands, except per ounce
and per ton data) 2013 2012 2013 2012
-------------------------------- --------- --------- --------- ---------
Stillwater Mine:
Total cash cost before by-
product and recycling credits
(Non-GAAP) $ 52,401 $ 50,685 $ 217,921 $ 200,016
Less: By-product credit (3,636) (4,499) (16,270) (19,793)
Less: Recycling income credit (2,495) (2,005) (24,470) (8,124)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 46,270 $ 44,181 $ 177,181 $ 172,099
Divided by platinum/palladium
ounces produced 99 98 366 378
Total cash cost before by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 529 $ 517 $ 595 $ 529
Less: By-product credit per
ounce Pt/Pd produced (37) (46) (44) (52)
Less: Recycling income credit
per ounce Pt/Pd produced (25) (20) (67) (21)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 467 $ 451 $ 484 $ 456
Divided by ore tons milled 193 186 801 709
Total cash cost before by-
product and recycling credits
per ore ton milled (Non-GAAP) $ 272 $ 273 $ 272 $ 282
Less: By-product credit per ore
ton milled (19) (24) (20) (28)
Less: Recycling income credit
per ore ton milled (13) (11) (31) (11)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ore ton milled (Non-GAAP) $ 240 $ 238 $ 221 $ 243
Reconciliation to costs of
revenues:
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 46,270 $ 44,181 $ 177,181 $ 172,099
Asset retirement costs 165 153 639 588
Depletion, depreciation and
amortization 11,030 10,653 44,696 43,329
Depletion, depreciation and
amortization (in inventory) 1,111 1,377 896 924
Change in product inventories (2,158) (3,414) (5,110) (2,326)
By-product credit 3,636 4,499 16,270 19,793
Profit from PGM Recycling
(before bad debt expense and
gain/loss on asset disposals) 2,495 2,005 24,470 8,124
--------- --------- --------- ---------
Total cost of revenues $ 62,549 $ 59,454 $ 259,042 $ 242,531
========= ========= ========= =========
Memo: Royalties, Taxes and Other
included in Total cost of
revenues $ 6,823 $ 5,982 $ 29,525 $ 27,062
Stillwater Mining Company
Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues
(Continued)
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------------------- -------------------- --------------------
(In thousands, except per ounce
and per ton data) 2013 2012 2013 2012
-------------------------------- --------- --------- --------- ---------
East Boulder
Total cash cost before by-
product and recycling credits
(Non-GAAP) $ 27,698 $ 22,029 $ 104,643 $ 90,330
Less: By-product credit (2,346) (2,580) (10,815) (10,849)
Less: Recycling income credit (1,095) (676) (10,993) (2,918)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 24,257 $ 18,773 $ 82,835 $ 76,563
Divided by platinum/palladium
ounces produced 42 35 158 136
Total cash cost before by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 659 $ 629 $ 664 $ 663
Less: By-product credit per
ounce Pt/Pd produced (56) (74) (69) (80)
Less: Recycling income credit
per ounce Pt/Pd produced (26) (19) (70) (21)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ounce Pt/Pd produced (Non-
GAAP) $ 577 $ 536 $ 525 $ 562
Divided by ore tons milled 123 115 473 441
Total cash cost before by-
product and recycling credits
per ore ton milled (Non-GAAP) $ 225 $ 192 $ 221 $ 205
Less: By-product credit per ore
ton milled (19) (22) (23) (25)
Less: Recycling income credit
per ore ton milled (9) (6) (23) (7)
--------- --------- --------- ---------
Total cash cost net of by-
product and recycling credits
per ore ton milled (Non-GAAP) $ 197 $ 164 $ 175 $ 173
Reconciliation to costs of
revenues:
Total cash cost net of by-
product and recycling credits
(Non-GAAP) $ 24,257 $ 18,773 $ 82,835 $ 76,563
Asset retirement costs 13 12 50 47
Depletion, depreciation and
amortization 3,346 3,458 13,505 13,631
Depletion, depreciation and
amortization (in inventory) 361 157 294 469
Change in product inventories (2,670) (1,011) (5,370) (1,126)
By-product credit 2,346 2,580 10,815 10,849
Profit from PGM Recycling
(before bad debt expense and
gain/loss on asset disposals) 1,095 676 10,993 2,918
--------- --------- --------- ---------
Total cost of revenues $ 28,748 $ 24,645 $ 113,122 $ 103,351
========= ========= ========= =========
Memo: Royalties, Taxes and Other
included in Total cost of
revenues $ 3,236 $ 2,589 $ 14,289 $ 12,531
PGM Recycling and Other: (1)
Cost of PGM Recycling $ 124,526 $ 85,589 $ 527,384 $ 334,949
PGM Recycling - depreciation 312 262 1,116 1,055
--------- --------- --------- ---------
Total cost of revenues $ 124,838 $ 85,851 $ 528,500 $ 336,004
========= ========= ========= =========
(1) PGM Recycling and Other include PGM recycling and metal purchased on
the open market for resale.
Stillwater Mining Company
All-In Sustaining Cost a Non-GAAP Measure
All-In Sustaining Costs (Non-GAAP): This non-GAAP measure is used as an indicator from period to period of the level of total cash required by the business to maintain and operate the existing mines, including corporate administrative costs and replacement capital. The measure is calculated beginning with total cash costs (another non-GAAP measure, described above), and adding to it the recycling income credit, corporate overhead costs (excluding any depreciation and amortization costs and other non-recurring non-cash costs included in corporate overhead costs), marketing costs, and that portion of total capital expenditures associated with sustaining the current level of mining operations.
When divided by the total recoverable PGM ounces in the respective period, All-In Sustaining Costs per Ounce (non-GAAP) provides an indication of the level of total cash required to maintain and operate the mines per PGM ounce produced in the period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because the objective of PGM mining activity is to extract PGM material, the all-in cash cost per ounce to produce PGM material, administer the business and sustain the operating capacity of the mines is a useful measure for comparing overall extraction efficiency between periods. This measure is affected by the total level of spending in the period and by the grade and volume of ore produced.
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------- --------------------
(In thousands, except $/oz.) 2013 2012 2013 2012
All-In Sustaining Costs
Total Cash Costs (a non-GAAP
measure) $ 70,527 $ 62,954 $ 260,016 $ 248,662
Add: Recycling income credit 3,590 2,681 35,463 11,041
--------- --------- --------- ---------
$ 74,117 $ 65,635 $ 295,479 $ 259,703
Consolidated Corporate General
& Administrative costs $ 178,244 $ 9,061 $ 346,538 $ 41,538
Less: Depreciation and
amortization included in
Consolidated Corporate
General & Administrative
costs (204) (259) (785) (691)
Less: Non-recurring non-cash
Items in Consolidated
Corporate General &
Administrative costs (171,338) - (303,787) -
Add: Marketing costs 158 3,296 4,355 11,170
--------- --------- --------- ---------
$ 6,860 $ 12,098 $ 46,321 $ 52,017
Total capital incurred to
sustain existing operations 27,583 25,047 94,931 83,237
--------- --------- --------- ---------
All-In Sustaining Cost $ 108,560 $ 102,780 $ 436,731 $ 394,957
Mined Ounces per Cost Report 141 132 524 514
--------- --------- --------- ---------
All-In Sustaining Cost per
Mined Ounce ($/oz.) $ 770 $ 777 $ 833 $ 768
========= ========= ========= =========
INVESTOR CONTACT: Mike Beckstead (406) 373-8971