Coeur Mining(CDE)2024-11-06 21:31Revenue and Financial Performance - Revenue for Q3 2024 totaled $313 million, a 41% increase quarter-over-quarter and a 60% increase year-over-year[1][6] - Revenue for Q3 2024 increased to $313.5 million, up 61.1% from $194.6 million in Q3 2023[59] - Revenue for Q3 2024 was $313.5 million, compared to $194.6 million in Q3 2023, representing a 61% increase[63] Adjusted EBITDA and Margins - Adjusted EBITDA for Q3 2024 was $126 million, a 140% increase quarter-over-quarter and a 2.5x increase over the last twelve months[1][2] - Adjusted EBITDA for Q3 2024 was $126.0 million, with an Adjusted EBITDA Margin of 28%, up from 16% in Q3 2023[63] Production Metrics - Gold production increased by 21% to 94,993 ounces, and silver production increased by 15% to 3.0 million ounces compared to the prior quarter[2] - Third quarter gold and silver production totaled 27,549 and 1.8 million ounces, respectively, compared to 25,467 and 1.6 million ounces in the prior period[17] - Silver and gold production in the third quarter totaled 1.2 million and 9,690 ounces, respectively, compared to 973,057 and 8,006 ounces in the prior period[21] - Gold production in Q3 2024 at Kensington totaled 24,104 ounces, up from 23,202 ounces in Q2 2024 and 24,614 ounces in Q3 2023, driven by higher average gold grade[24] - Gold production at Wharf increased 53% quarter-over-quarter to 33,650 ounces in Q3 2024, driven by higher average gold grade and timing of ounces placed on leach pads[27] Costs and Margins - Costs applicable to sales per gold and silver ounce both declined by 12% quarter-over-quarter, leading to margins more than double the prior period[2] - Adjusted CAS for gold and silver decreased 19% and 17% quarter-over-quarter to $818 and $12.60 per ounce, respectively[17] - Third quarter adjusted CAS for silver and gold on a co-product basis totaled $20.88 and $1,735 per ounce, respectively[22] - Adjusted CAS at Kensington decreased to $1,539 per ounce in Q3 2024 from $1,734 per ounce in Q2 2024, reflecting increased metal sales[24] - Adjusted CAS at Wharf increased 8% quarter-over-quarter to $885 per ounce in Q3 2024, due to decreasing favorable recoveries on legacy pads[27] Cash Flow and Liquidity - Operating cash flow for Q3 2024 was $111 million, the highest level in over a decade, driven by higher production and metals prices[2][10] - Free cash flow reached $69 million during the quarter, a significant improvement from the prior period's negative $36.2 million[2][5] - Free cash flow in the third quarter totaled $48 million compared to $18 million in the prior period[17] - Free cash flow at Kensington improved to $18 million in Q3 2024 from $(24) million in Q2 2024[24] - Free cash flow at Wharf reached an all-time high of $49 million in Q3 2024, up from $16 million in Q2 2024, reflecting higher gold sales[27] - Cash flow from operating activities in Q3 2024 was $111.1 million, a significant improvement from a negative $2.4 million in Q3 2023[61] - Free cash flow in Q3 2024 was $69.1 million, a significant improvement from a negative $114.7 million in Q3 2023[66] Debt and Financial Position - The company reduced its outstanding revolving credit facility balance by $50 million to $225 million, achieving a net debt to EBITDA ratio below 2.0x for the first time in three years[2] - Coeur had $30 million in outstanding letters of credit and $225 million in outstanding borrowings under its RCF as of September 30, 2024[54] - Total debt increased to $605.2 million, up 13.4% from $533.8 million at the end of 2023[57] - The company issued $77.5 million in notes and bank borrowings in Q3 2024, compared to $163.0 million in Q3 2023[61] Capital Expenditures and Exploration - Exploration investment during the quarter was approximately $25 million, compared to $18 million in the prior period[7][9] - Capital expenditures increased 36% quarter-over-quarter to $8 million, reflecting higher underground development[17] - Capital expenditures in Q3 2024 were $42.0 million, down from $112.3 million in Q3 2023[61] - Total 2024 exploration investment is expected to be $40 - $50 million for expansion drilling and $15 - $20 million for infill drilling[30] - 2024 capital expenditures guidance includes $124 - $158 million for sustaining capital and $36 - $42 million for development capital[40] Acquisitions and Strategic Moves - The acquisition of SilverCrest Metals Inc. was announced, with an implied value of approximately $1.7 billion, expected to close in Q1 2025[2][12] - Coeur is in the process of acquiring SilverCrest, with expected impacts on production, cash flow, and financial condition, though the acquisition may face delays or risks[44] Operational Highlights - Rochester operation placed 7.1 million tons under leach, producing 1.2 million ounces of silver and 9,690 ounces of gold, representing quarter-over-quarter increases of 19% and 21%, respectively[2] - Coeur operates four wholly-owned mining operations: Palmarejo (Mexico), Rochester (Nevada), Kensington (Alaska), and Wharf (South Dakota), along with the Silvertip exploration project in British Columbia[43] Metal Prices - Coeur's average gold spot price per ounce in Q3 2024 was $2,474, up from $2,338 in Q2 2024 and $1,928 in Q3 2023[55] - The average silver spot price per ounce in Q3 2024 was $29.43, compared to $28.45 in Q2 2024 and $23.57 in Q3 2023[55] - Coeur's average zinc spot price per pound in Q3 2024 was $1.26, down from $1.29 in Q2 2024 but up from $1.10 in Q3 2023[55] - The average lead spot price per pound in Q3 2024 was $0.92, compared to $0.98 in Q2 2024 and $0.98 in Q3 2023[55] Net Income and Earnings - Net income for Q3 2024 was $48.7 million, compared to a net loss of $21.1 million in Q3 2023[59] - Basic earnings per share for Q3 2024 were $0.12, compared to a loss of $0.06 per share in Q3 2023[59] - Adjusted net income for Q3 2024 was $47.2 million, compared to an adjusted net loss of $18.6 million in Q3 2023[64] Assets and Liabilities - Total assets increased to $2.23 billion as of September 30, 2024, up from $2.08 billion at the end of 2023[57] - Cash and cash equivalents grew to $76.9 million, a 24.8% increase from $61.6 million at the end of 2023[57] - Ore on leach pads increased significantly to $148.3 million, up 86.8% from $79.4 million at the end of 2023[57] - Cash, cash equivalents, and restricted cash at the end of Q3 2024 were $78.7 million, up from $54.9 million at the end of Q3 2023[61] Costs and Expenses - Costs applicable to sales for Q3 2024 were $156.7 million, up 6.0% from $147.9 million in Q3 2023[59] - Exploration expenses for Q3 2024 increased to $19.6 million, up 57.3% from $12.4 million in Q3 2023[59] - Total costs applicable to sales for Q3 2024 were $189,782 thousand, with adjusted costs applicable to sales at $154,245 thousand[69] - Adjusted costs applicable to sales for gold in Q3 2024 were $1,113 per ounce, while silver was $15.67 per ounce[69] Sales and Revenue Split - Gold sales for Q3 2024 totaled 96,913 ounces, with revenue split at 50% for Palmarejo and 100% for Kensington and Wharf[69] - Silver sales for Q3 2024 were 3,004,501 ounces, with revenue split at 50% for Palmarejo and 59% for Rochester[69] - Gold sales for the three months ended June 30, 2024, were 76,932 ounces, with adjusted costs at $1,264 per ounce[70] - Silver sales for the three months ended June 30, 2024, were 2,592,727 ounces, with adjusted costs at $17.71 per ounce[70] - Gold sales for the three months ended March 31, 2024, were 81,416 ounces, with adjusted costs at $1,267 per ounce[71] - Total adjusted costs applicable to sales for Q4 2023 were $171.58 million, with Palmarejo contributing $50.20 million, Rochester $54.51 million, Kensington $37.44 million, and Wharf $29.44 million[73] - Gold sales for Q4 2023 totaled 99,541 ounces, with Palmarejo contributing 24,849 ounces, Rochester 19,174 ounces, Kensington 25,980 ounces, and Wharf 29,538 ounces[73] - Silver sales for Q4 2023 totaled 3,000,338 ounces, with Palmarejo contributing 1,644,592 ounces, Rochester 1,269,236 ounces, and Wharf 86,510 ounces[73] - Adjusted costs per gold ounce for Q4 2023 were $1,225, with Palmarejo at $1,010, Rochester at $1,564, Kensington at $1,441, and Wharf at $997[73] - Adjusted costs per silver ounce for Q4 2023 were $17.03, with Palmarejo at $15.26 and Rochester at $19.33[73] - Total adjusted costs applicable to sales for Q3 2023 were $137.50 million, with Palmarejo contributing $47.73 million, Rochester $22.74 million, Kensington $37.82 million, and Wharf $29.21 million[74] - Gold sales for Q3 2023 totaled 78,015 ounces, with Palmarejo contributing 26,018 ounces, Rochester 4,432 ounces, Kensington 24,516 ounces, and Wharf 23,049 ounces[74] - Silver sales for Q3 2023 totaled 2,213,735 ounces, with Palmarejo contributing 1,533,975 ounces, Rochester 606,083 ounces, and Wharf 73,677 ounces[74] - Adjusted costs per gold ounce for Q3 2023 were $1,273, with Palmarejo at $917, Rochester at $1,899, Kensington at $1,543, and Wharf at $1,267[74] - Adjusted costs per silver ounce for Q3 2023 were $17.85, with Palmarejo at $15.56 and Rochester at $23.64[74] Guidance and Future Expectations - Full-year 2024 production is expected to be 95,000 - 103,000 ounces of gold and 5.9 - 6.7 million ounces of silver[18] - CAS in 2024 are expected to be $950 - $1,150 per gold ounce and $15.50 - $16.50 per silver ounce[18] - Capital expenditures are expected to be $27 - $37 million, consisting primarily of sustaining capital and underground development[18] - Full-year 2024 production is expected to be 4.8 - 6.6 million ounces of silver and 37,000 - 50,000 ounces of gold[22] - Full-year 2024 production guidance for Kensington is 92,000 - 106,000 gold ounces, with CAS expected to be $1,525 - $1,725 per ounce[25] - Full-year 2024 production guidance for Wharf is 86,000 - 96,000 gold ounces, with CAS expected to be $950 - $1,050 per ounce[29] Non-GAAP Financial Measures - Coeur uses non-GAAP financial measures such as EBITDA, adjusted EBITDA, and free cash flow to assess financial performance, with detailed reconciliations provided in its Form 10-K[53] Liquidity and Financial Covenants - The company's liquidity is defined as cash and cash equivalents plus availability under its RCF, subject to financial covenants[54] Conference Call and Investor Relations - Coeur will host a conference call to discuss its Q3 2024 financial results on November 7, 2024, at 11:00 a.m. Eastern Time[42] Operating Cash Flow - Operating cash flow before changes in working capital for Q3 2024 was $86,932 thousand, a significant increase from $27,482 thousand in Q2 2024 and $14,187 thousand in Q3 2023[68]