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McEwen Mining(MUX) - 2024 Q4 - Annual Report
MUXMcEwen Mining(MUX)2025-03-14 21:19
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Production and Sales - In 2024, total production included 111,814 ounces of gold and 2,041,891 ounces of silver, resulting in a total of 135,884 gold equivalent ounces[25]. - Revenue from gold and silver sales in 2024 was 105.1millionfromtheGoldBarmine,105.1 million from the Gold Bar mine, 67.8 million from the Fox Complex, 1.5millionfromtheElGallomine,and1.5 million from the El Gallo mine, and 152.1 million from the San José mine on a 49% basis[27]. - The Gold Bar mine produced 44,574 ounces of gold and 532 ounces of silver in 2024, contributing significantly to overall production[25]. - The San José mine, operating at a 49% interest, produced 36,127 ounces of gold and 2,033,619 ounces of silver, accounting for 60,100 gold equivalent ounces[25]. - For the year ended December 31, 2024, the company generated revenues of 174.5millionfromgoldandsilversales,indicatingasignificantdependencyoncommodityprices[454].−Revenuefromgoldandsilversalesincreasedto174.5 million from gold and silver sales, indicating a significant dependency on commodity prices[454]. - Revenue from gold and silver sales increased to 174,477,000 in 2024, up 5% from 166,231,000in2023[490].ReservesandResources−Thecompanyreportedattributableestimatedprovenandprobablegoldreservesof0.3millionouncesandsilverreservesof5.1millionouncesattheSanJoseˊmineasofDecember31,2024[34].−AsofDecember31,2024,thetotalprovenandprobablegoldreservesare10,852tonnesattheGoldBarmineand558tonnesattheSanJoseˊmine,totaling11,410tonnes[39].−ThegoldgradeattheSanJoseˊmineis5.02g/t,withprovenreservesof343tonnesandprobablereservesof215tonnes,yieldingatotalof90.1koz[39].−ThesilverreservesattheSanJoseˊmineare558tonnes,withasilvergradeof286g/t,resultinginatotalof5.1Moz[39].−TheestimatedmeasuredandindicatedmineralresourcesasofDecember31,2024,include2.7millionouncesofgoldand27.4millionouncesofsilver[54].−TheinferredmineralresourcesasofDecember31,2024,areestimatedat2.9millionouncesofgoldand78.6millionouncesofsilver[54].FinancialPerformance−Grossprofitroseto166,231,000 in 2023[490]. Reserves and Resources - The company reported attributable estimated proven and probable gold reserves of 0.3 million ounces and silver reserves of 5.1 million ounces at the San José mine as of December 31, 2024[34]. - As of December 31, 2024, the total proven and probable gold reserves are 10,852 tonnes at the Gold Bar mine and 558 tonnes at the San José mine, totaling 11,410 tonnes[39]. - The gold grade at the San José mine is 5.02 g/t, with proven reserves of 343 tonnes and probable reserves of 215 tonnes, yielding a total of 90.1 koz[39]. - The silver reserves at the San José mine are 558 tonnes, with a silver grade of 286 g/t, resulting in a total of 5.1 Moz[39]. - The estimated measured and indicated mineral resources as of December 31, 2024, include 2.7 million ounces of gold and 27.4 million ounces of silver[54]. - The inferred mineral resources as of December 31, 2024, are estimated at 2.9 million ounces of gold and 78.6 million ounces of silver[54]. Financial Performance - Gross profit rose to 30,935,000 in 2024, compared to 17,780,000in2023,markingasignificantimprovement[490].−Operatinglossnarrowedto17,780,000 in 2023, marking a significant improvement[490]. - Operating loss narrowed to 50,572,000 in 2024 from 162,063,000in2023,indicatingbetteroperationalefficiency[490].−Netlossattributabletoshareholderswas162,063,000 in 2023, indicating better operational efficiency[490]. - Net loss attributable to shareholders was 43,691,000 in 2024, a decrease from a profit of 55,299,000in2023[490].−Cashandcashequivalentsdecreasedto55,299,000 in 2023[490]. - Cash and cash equivalents decreased to 13,692,000 in 2024 from 23,020,000in2023,reflectingliquiditychallenges[492].−Totalassetsincreasedslightlyto23,020,000 in 2023, reflecting liquidity challenges[492]. - Total assets increased slightly to 664,623,000 in 2024 from 657,239,000in2023,showingstabilityinassetmanagement[492].−Totalliabilitiesroseto657,239,000 in 2023, showing stability in asset management[492]. - Total liabilities rose to 169,648,000 in 2024, up from 154,819,000in2023,indicatingincreasedfinancialobligations[492].ExplorationandDevelopment−ThecompanyisdevelopingtheStockPropertyasanundergroundmine,withproductionexpectedtobeginbyearly2026[17].−Thecompanyexpandeditsexploration−stagepropertiesinNevadathroughtheacquisitionofTimberlineResourcesCorporationinAugust2024[18].−Thecompanyaimstoincreaseshareholdervaluethroughtheexplorationandeconomicextractionofgold,silver,andothervaluableminerals[20].MarketandEconomicFactors−TheArgentinepesohasdevaluedby37154,819,000 in 2023, indicating increased financial obligations[492]. Exploration and Development - The company is developing the Stock Property as an underground mine, with production expected to begin by early 2026[17]. - The company expanded its exploration-stage properties in Nevada through the acquisition of Timberline Resources Corporation in August 2024[18]. - The company aims to increase shareholder value through the exploration and economic extraction of gold, silver, and other valuable minerals[20]. Market and Economic Factors - The Argentine peso has devalued by 37% in 2024, impacting the company's operations in Argentina[445]. - A 10% change in the price of gold and silver could result in an additional income or loss of approximately 17.5 million before income and mining taxes[454]. - The company does not hedge its sales, exposing it to fluctuations in commodity prices[456]. Environmental and Regulatory Compliance - The company has received all necessary permits for its operations in Canada and Mexico, ensuring compliance with local environmental regulations[95]. - The company is subject to extensive environmental regulations, which could lead to significant expenditures if operations are designated as "Superfund" sites[93]. - As of December 31, 2024, the company has surety bonds of 44.8millioninplacetocoverprojectedreclamationcosts,withanannualfeeof2.444.8 million in place to cover projected reclamation costs, with an annual fee of 2.4%[459]. Internal Controls and Risks - The company assessed its internal control over financial reporting and identified a material weakness, resulting in an adverse opinion from Ernst & Young LLP[465][480]. - The company did not have a sufficient complement of human resources, leading to deficiencies in internal controls over income taxes[481]. - The company continues to face risks related to the collection of VAT receivables, which are uncertain due to the Mexican tax authorities' payment procedures[458]. Investments and Other Financial Activities - The company reported a dilution gain from investments in McEwen Copper Inc. of 5,777,000 in 2024[490]. - The company incurred a loss of 46.977millionfromitsinvestmentinMcEwenCopperInc.in2024,comparedtoalossof46.977 million from its investment in McEwen Copper Inc. in 2024, compared to a loss of 57.821 million in 2023[498]. - The company owns a 46.4% interest in McEwen Copper Inc., which is developing the Los Azules copper project in Argentina[500].