Coeur Reports First Quarter 2019 Production and Sales Results
CHICAGO–(BUSINESS WIRE)–Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE: CDE) today
announced first quarter 2019 production of 78,336 ounces of gold, 2.5
million ounces of silver, 3.7 million pounds of zinc and 3.1 million
pounds of lead. Metal sales for the quarter were 85,326 ounces of gold,
2.6 million ounces of silver, 4.7 million pounds of zinc and 2.7 million
pounds of lead.
As disclosed on February 20, 2019, the Company expects to produce
334,000 – 372,000 ounces of gold, 12.2 – 14.7 million ounces of silver,
25 – 40 million pounds of zinc and 20 – 35 million pounds of lead in
2019.
“First quarter operating results were in-line with our expectations”
said Mitchell J. Krebs, Coeur’s President and Chief Executive Officer.
“Our top two 2019 initiatives – successfully ramping up operating
activities at Silvertip and completing the installation of the
high-pressure grinding roll (“HPGR”) unit at Rochester – remain
on-track. Our Kensington mine continues to see the benefit of higher
grades from the Jualin deposit, while Wharf exceeded its plan during the
first quarter and is positioned to deliver higher production during the
remainder of the year.”
“As previously indicated, our full-year financial and operating results
are anticipated to be second half weighted. We expect higher production
levels at Palmarejo as production begins at the new La Nación deposit
and a new thickener is commissioned in the second half of 2019.
Rochester’s second half 2019 production is expected to increase due to
the positive impacts of the new HPGR unit, while higher mining and
processing rates from the higher-grade Jualin deposit are expected to
boost second half production at Kensington. Together, these initiatives
are expected to lead to a return to positive free cash flow in 2019.”
Operations
First quarter production and sales highlights for each of Coeur’s
operations are provided below.
|
Palmarejo, Mexico |
||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | ||||||
| Tons milled | 378,987 | 378,389 | 300,116 | 344,073 | 359,893 | |||||
| Average gold grade (oz/t) | 0.07 | 0.08 | 0.10 | 0.11 | 0.10 | |||||
| Average silver grade (oz/t) | 4.64 | 5.96 | 6.26 | 6.86 | 6.88 | |||||
| Average recovery rate – Au | 83.4% | 97.6% | 88.8% | 89.9% | 80.4% | |||||
| Average recovery rate – Ag | 72.8% | 84.0% | 82.2% | 87.5% | 81.4% | |||||
| Ounces Produced | ||||||||||
| Gold | 23,205 | 31,239 | 27,885 | 33,702 | 29,896 | |||||
| Silver (000’s) | 1,278 | 1,893 | 1,544 | 2,066 | 2,013 | |||||
| Ounces Sold | ||||||||||
| Gold | 27,394 | 23,667 | 29,830 | 31,207 | 30,888 | |||||
| Silver (000’s) | 1,405 | 1,534 | 1,572 | 2,092 | 2,031 | |||||
| Average realized price per gold ounce | $1,154 | $1,148 | $1,082 | $1,162 | $1,168 | |||||
| Average realized price per silver ounce | $15.39 | $14.57 | $14.75 | $16.49 | $16.73 | |||||
-
First quarter gold and silver production decreased 26% and 32%,
respectively, to 23,205 and 1.3 million ounces compared to the prior
quarter. Year-over-year, gold and silver production decreased 22% and
37%, respectively -
Lower production during the quarter was primarily driven by
temporarily lower grades and recoveries due to mine sequencing -
Underground development at the La Nación deposit, located between the
Independencia and Guadalupe underground mines, remains on-schedule.
Production is expected to commence in the second half of 2019, adding
approximately 400 tons per day of additional mill feed -
Installation of the new thickener at a cost of approximately $4.5
million remains on budget and on schedule for completion during the
third quarter, with foundation work near completion at the end of the
first quarter. The project is expected to increase gold and silver
recovery rates by approximately 2% and have an estimated one-year
payback -
Approximately 32% of gold sales in the first quarter, or 8,803 ounces,
were sold under Palmarejo’s gold stream agreement at a price of $800
per ounce. Full-year gold sales under the stream agreement are
expected to remain at similar levels -
Full-year 2019 production guidance remains unchanged at 95,000 –
105,000 ounces of gold and 6.5 – 7.2 million ounces of silver
|
Rochester, Nevada |
||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | ||||||
| Tons placed | 2,667,559 | 3,674,566 | 4,061,082 | 4,083,028 | 4,351,131 | |||||
| Average silver grade (oz/t) | 0.46 | 0.46 | 0.52 | 0.53 | 0.54 | |||||
| Average gold grade (oz/t) | 0.003 | 0.004 | 0.004 | 0.004 | 0.003 | |||||
| Ounces Produced | ||||||||||
| Silver (000’s) | 960 | 1,466 | 1,290 | 1,125 | 1,157 | |||||
| Gold | 8,256 | 15,926 | 14,702 | 12,273 | 11,487 | |||||
| Ounces Sold | ||||||||||
| Silver (000’s) | 1,000 | 1,391 | 1,248 | 1,097 | 1,119 | |||||
| Gold | 8,511 | 15,339 | 14,257 | 12,030 | 11,163 | |||||
| Average realized price per silver ounce | $15.31 | $14.53 | $14.70 | $16.47 | $16.66 | |||||
| Average realized price per gold ounce | $1,299 | $1,234 | $1,204 | $1,297 | $1,331 | |||||
-
Silver and gold production during the first quarter decreased 35% and
48%, respectively, to 1.0 million and 8,256 ounces compared to the
prior quarter. Year-over-year, silver and gold production decreased
17% and 28%, respectively -
Lower production was driven by reduced ore placement rates due to
adverse weather conditions (snowfall) in western Nevada. This had a
comparatively larger impact on gold production as silver production
was partially offset by higher residual leach pad performance -
Commissioning of the initial HPGR unit remains on budget and on
schedule. Crushing rates and silver recoveries are anticipated to
increase beginning mid-year with full ramp-up expected during the
third quarter. To date, foundation work has been completed and the two
main crushing units have been set in place, with steel erection
continuing and electrical tie-in work currently underway -
The Company is maintaining full-year 2019 production guidance of 4.2 –
5.0 million ounces of silver and 40,000 – 50,000 ounces of gold;
installation of the initial HPGR unit and a new secondary crusher is
expected to result in higher production during the second half of the
year compared to the first half
|
Kensington, Alaska |
||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | ||||||
| Tons milled | 164,332 | 166,310 | 167,964 | 168,751 | 158,706 | |||||
| Average gold grade (oz/t) | 0.20 | 0.23 | 0.17 | 0.16 | 0.17 | |||||
| Average recovery rate | 90.2% | 93.0% | 91.8% | 92.6% | 94.0% | |||||
| Gold ounces produced | 29,973 | 35,335 | 26,809 | 25,570 | 26,064 | |||||
| Gold ounces sold | 31,335 | 33,202 | 25,648 | 28,165 | 27,763 | |||||
| Average realized price per gold ounce | $1,290 | $1,246 | $1,161 | $1,269 | $1,307 | |||||
-
Commercial production at Jualin was declared on December 1, 2018. The
figures shown in the table above include pre-commercial production -
First quarter gold production of 29,973 ounces represented a 15%
decrease quarter-over-quarter and a 15% increase compared to the same
period the prior year. During the quarter, mining activities at Jualin
shifted focus from ore development to full production, allowing for
longhole stope production at Jualin in future quarters -
Ore from Jualin accounted for approximately 10% of Kensington’s
production during the quarter. This contribution is expected to
increase in the remaining quarters of 2019 -
Full-year 2019 production guidance is unchanged at 117,000 – 130,000
ounces of gold
|
Wharf, South Dakota |
||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | ||||||
| Tons placed | 1,090,510 | 1,644,168 | 1,127,391 | 1,075,820 | 1,076,395 | |||||
| Average gold grade (oz/t) | 0.020 | 0.020 | 0.023 | 0.023 | 0.022 | |||||
| Ounces produced | ||||||||||
| Gold | 16,902 | 16,960 | 19,437 | 22,507 | 17,936 | |||||
| Silver (000’s) | 13 | 13 | 13 | 13 | 12 | |||||
| Ounces sold | ||||||||||
| Gold | 18,086 | 15,306 | 19,874 | 23,053 | 17,339 | |||||
| Silver (000’s) | 14 | 11 | 12 | 14 | 11 | |||||
| Average realized price per gold ounce | $1,317 | $1,247 | $1,198 | $1,285 | $1,341 | |||||
-
Gold production remained relatively flat quarter-over-quarter at
16,902 ounces in the first quarter and decreased 6% year-over-year -
Production levels reflected the impact of lower grade tons placed in
the prior quarter. Production was above target and is expected to
increase throughout the remainder of the year -
The Company is maintaining full-year 2019 production guidance of
82,000 – 87,000 ounces of gold
|
Silvertip, British Columbia |
||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | ||||||
| Tons milled | 62,051 | 38,802 | 28,080 | 14,450 | 4,795 | |||||
| Average silver grade (oz/t) | 5.50 | 6.06 | 7.29 | 14.15 | 10.05 | |||||
| Average zinc grade (%) | 5.9% | 5.8% | 8.0% | 8.2% | 6.6% | |||||
| Average lead grade (%) | 3.7% | 3.9% | 4.6% | 8.1% | 7.3% | |||||
| Average recovery rate – Ag | 69.9% | 60.5% | 47.0% | 42.3% | 30.9% | |||||
| Average recovery rate – Zn | 50.5% | 69.1% | 49.1% | 57.9% | 18.7% | |||||
| Average recovery rate – Pb | 66.8% | 54.7% | 44.4% | 40.5% | 21.1% | |||||
| Produced | ||||||||||
| Silver (000’s ounces) |
239 |
142 | 96 | 87 | 15 | |||||
| Zinc (000’s lbs) | 3,719 | 3,083 | 2,207 | 1,372 | 119 | |||||
| Lead (000’s lbs) | 3,077 | 1,658 | 1,159 | 949 | 147 | |||||
| Sold | ||||||||||
| Silver (000’s ounces) | 215 | 127 | 131 | 10 | — | |||||
| Zinc (000’s lbs) | 4,723 | 2,552 | 1,772 | 469 | — | |||||
| Lead (000’s lbs) | 2,748 | 1,444 | 1,645 | — | — | |||||
| Average realized price per silver ounce, gross | $14.98 | $15.54 | $14.62 | $16.31 | — | |||||
| Treatment and refining charges per silver ounce | $1.24 | $1.38 | $3.34 | $3.30 | ||||||
| Average realized price per silver ounce, net | $13.74 | $14.16 | $11.28 | $13.01 | — | |||||
| Average realized price per zinc pound, gross | $1.50 | $1.07 | $1.20 | $1.35 | — | |||||
| Treatment and refining charges per zinc pound | $0.31 | $0.24 | $0.27 | $0.27 | ||||||
| Average realized price per zinc pound, net | $1.19 | $0.83 | $0.93 | $1.08 | — | |||||
| Average realized price per lead pound, gross | $0.92 | $0.87 | $0.97 | $— | — | |||||
| Treatment and refining charges per lead pound | $0.06 | $0.07 | $0.07 | $— | ||||||
| Average realized price per lead pound, net | $0.86 | $0.80 | $0.90 | $— | — | |||||
-
Silvertip achieved commercial production on September 1, 2018. The
figures shown in the above table include pre-commercial production -
First quarter silver, zinc and lead production increased 68%, 21% and
86%, respectively, to 0.2 million ounces of silver, 3.7 million pounds
of zinc and 3.1 million pounds of lead compared to the prior quarter -
Higher production was driven by higher tons milled, which increased
60% quarter-over-quarter. The mill exceeded 1,100 tonnes per day
(“tpd”) (1,000 metric tons per day (“mtpd”)) intermittently in March
and averaged approximately 843 tpd (765 mtpd), excluding two days of
scheduled maintenance -
Average head grades, recovery rates and concentrate grades are
expected to continue trending higher as mill availability improves and
newly-mined higher grade material is processed -
The permit amendment application to operate at a year-round mining and
milling rate of 1,100 tpd (1,000 mtpd) is expected to be received late
in the current quarter -
The new 220-person camp facility was opened to employees at the
beginning of March 2019 -
Full-year 2019 production guidance is unchanged at 1.5 – 2.5 million
ounces of silver, 25 – 40 million pounds of zinc and 20 – 35 million
pounds of lead
2019 Production Guidance
Coeur’s 2019 production guidance remains unchanged from its original
guidance published on February 20, 2019.
| Gold | Silver | Zinc | Lead | |||||
| (oz) | (K oz) | (K lbs) | (K lbs) | |||||
| Palmarejo | 95,000 – 105,000 | 6,500 – 7,200 | — | — | ||||
| Rochester | 40,000 – 50,000 | 4,200 – 5,000 | — | — | ||||
| Kensington | 117,000 – 130,000 | — | — | — | ||||
| Wharf | 82,000 – 87,000 | — | — | — | ||||
| Silvertip | — | 1,500 – 2,500 | 25,000 – 40,000 | 20,000 – 35,000 | ||||
| Total | 334,000 – 372,000 | 12,200 – 14,700 | 25,000 – 40,000 | 20,000 – 35,000 | ||||
Financial Results and Conference Call
Coeur will report its first quarter financial results on May 1, 2019
after the New York Stock Exchange closes for trading. There will be a
conference call on May 2, 2019 at 11:00 a.m. Eastern Time.
| Dial-In Numbers: | (855) 560-2581 (U.S.) | ||
| (855) 669-9657 (Canada) | |||
| (412) 542-4166 (International) | |||
| Conference ID: | Coeur Mining | ||
Hosting the call will be Mitchell J. Krebs, President and Chief
Executive Officer of Coeur, who will be joined by Thomas S. Whelan,
Senior Vice President and Chief Financial Officer, Terry F. D. Smith,
Senior Vice President of Operations, Hans J. Rasmussen, Senior Vice
President of Exploration, and other members of management. A replay of
the call will be available through May 16, 2019.
| Replay numbers: | (877) 344-7529 (U.S.) | ||
| (855) 669-9658 (Canada) | |||
| (412) 317-0088 (International) | |||
| Conference ID: | 101 29 527 | ||
About Coeur
Coeur Mining, Inc. is a U.S.-based, well-diversified, growing precious
metals producer with five wholly-owned operations: the Palmarejo
gold-silver 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 Silvertip silver-zinc-lead mine in British Columbia. In
addition, the Company has interests in several precious metals
exploration projects throughout North America.
Cautionary Statement
This news release contains forward-looking statements within the meaning
of securities legislation in the United States and Canada, including
statements regarding anticipated production, results, recoveries, mining
rates, throughput, development efforts, operations at Palmarejo,
Rochester, Kensington, Wharf and Silvertip and timing of obtaining
permit amendment approval for Silvertip. 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 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,
silver, zinc, and lead 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, the uncertainties inherent in the
estimation of mineral reserves, changes that could result from Coeur’s
future acquisition of new mining properties or businesses, the loss or
insolvency of any third-party smelter or refiner with whom Coeur does
business, 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,
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 reports on Form 10-K and Form 10-Q. 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 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 sedar.com.
|
Average Spot Prices |
|||||||||||||||||||
| 1Q 2019 | 4Q 2018 | 3Q 2018 | 2Q 2018 | 1Q 2018 | |||||||||||||||
| Average Silver Spot Price Per Ounce | $ | 15.57 | $ | 14.54 | $ | 15.02 | $ | 16.53 | $ | 16.77 | |||||||||
| Average Gold Spot Price Per Ounce | $ | 1,304 | $ | 1,226 | $ | 1,213 | $ | 1,306 | $ | 1,329 | |||||||||
| Average Zinc Spot Price Per Pound | $ | 1.23 | $ | 1.19 | $ | 1.15 | $ | 1.41 | $ | 1.55 | |||||||||
| Average Lead Spot Price Per Pound | $ | 0.92 | $ | 0.89 | $ | 0.95 | $ | 1.08 | $ | 1.14 | |||||||||
Contacts
For Additional Information
Coeur Mining, Inc.
104 S.
Michigan Avenue, Suite 900
Chicago, IL 60603
Attention: Paul
DePartout, Director, Investor Relations
Phone: (312) 489-5800
www.coeur.com
