SSR Mining(SSRM) - 2022 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION This section provides comprehensive financial information, including statements, notes, and management's analysis of operations THIRD QUARTER 2022 HIGHLIGHTS The third quarter of 2022 saw SSR Mining produce 106,919 gold equivalent ounces, with year-to-date production reaching 441,164 gold equivalent ounces. Operations at the Çöpler mine restarted in late September after a temporary suspension. The company reported an attributable net loss of $25.8 million for the quarter and a year-to-date operating cash flow of $42.8 million, with a free cash flow of $(73.4) million. Capital returns to shareholders totaled $144.4 million year-to-date, and the balance sheet remained strong with $748.5 million in cash and cash equivalents. Key strategic activities included the sale of the Pitarrilla project and an agreement to consolidate ownership in the Çöpler District to 80% - Operating performance: Delivered third quarter production of 106,919 gold equivalent ounces, and year-to-date production of 441,164 gold equivalent ounces[11] - Çöpler production restarted late September: Operations at the Çöpler mine were temporarily suspended on June 21, 2022, and restarted on September 22, 2022, after implementing improvement initiatives and receiving regulatory approvals[11] Key Financial Results (Q3 & YTD 2022) | Metric | Q3 2022 | YTD 2022 | | :----------------------------------- | :------ | :------- | | Attributable Net Loss | $(25.8) million | N/A | | Adjusted Attributable Net Loss | $(13.5) million | N/A | | Operating Cash Flow | N/A | $42.8 million | | Free Cash Flow | N/A | $(73.4) million | - Capital returns: Returned $144.4 million to shareholders in 2022, including $44.4 million in dividends and $100.0 million in share repurchases[11] - Balance sheet and financial strength: Ended Q3 with a cash and cash equivalents balance of $748.5 million[11] - Completed the sale of the Pitarrilla project: On July 6, 2022, sold the Pitarrilla project for $35.0 million in cash, $35.0 million in common shares of Endeavour Silver, and a 1.25% net smelter return royalty[11] - Consolidated ownership of the Çöpler District: Subsequent to the quarter, agreed to acquire an additional 30% ownership interest in the Kartaltepe Mining Joint Venture for $150.0 million in cash, increasing SSR Mining's ownership to 80%[11] ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA This section presents the unaudited condensed consolidated financial statements, including statements of operations, cash flows, balance sheets, and changes in equity, along with detailed notes. Key financial highlights include a significant decrease in revenue and a net loss for Q3 2022, primarily due to the temporary suspension of operations at the Çöpler mine. The balance sheet shows a decrease in cash and total assets, while liabilities also decreased. The notes provide crucial context on company operations, accounting policies, acquisitions, divestitures, segment performance, revenue breakdown, tax information, and debt structure, including a non-compliance event related to the Term Loan Condensed Consolidated Statements of Operations (unaudited) Condensed Consolidated Statements of Operations (in thousands, except per share) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :------------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Revenue | $166,627 | $322,846 | $841,656 | $1,066,280 | | Operating income (loss) | $(35,064) | $92,659 | $150,901 | $325,559 | | Net income (loss) attributable to SSR Mining shareholders | $(25,793) | $57,060 | $100,256 | $240,641 | | Basic Net income (loss) per share | $(0.12) | $0.27 | $0.48 | $1.11 | | Diluted Net income (loss) per share | $(0.12) | $0.26 | $0.46 | $1.06 | Condensed Consolidated Statements of Cash Flows (unaudited) Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :-------------------------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $42,799 | $424,380 | | Net cash used in investing activities | $(69,983) | $(130,499) | | Net cash used in financing activities | $(238,634) | $(290,389) | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $(268,820) | $2,390 | | Cash, cash equivalents, and restricted cash end of period | $784,045 | $898,311 | Condensed Consolidated Balance Sheets (unaudited) Condensed Consolidated Balance Sheets (in thousands) | Metric | September 30, 2022 | December 31, 2021 | | :---------------------------------- | :----------------- | :---------------- | | Total current assets | $1,430,736 | $1,600,314 | | Total assets | $4,995,258 | $5,211,438 | | Total current liabilities | $247,081 | $283,882 | | Total liabilities | $1,000,680 | $1,158,921 | | Total equity | $3,994,578 | $4,052,517 | Condensed Consolidated Statements of Changes in Equity (unaudited) Changes in Equity (in thousands) | Metric | Balance as of December 31, 2021 | Balance as of September 30, 2022 | | :---------------------------------- | :------------------------------ | :----------------------------- | | Common shares (amount) | $3,140,189 | $3,056,924 | | Retained earnings (deficit) | $397,667 | $442,323 | | SSR Mining's shareholders' equity | $3,537,856 | $3,499,247 | | Non-controlling interest | $514,661 | $495,331 | | Total equity | $4,052,517 | $3,994,578 | - During the nine months ended September 30, 2022, the Company repurchased 6,053,126 common shares for $100.0 million and paid $44.4 million in dividends to shareholders[104][103][185] Note 1. THE COMPANY - SSR Mining is a precious metals mining company with four producing assets located in the United States, Türkiye, Canada, and Argentina, primarily engaged in the operation, acquisition, exploration, and development of precious metal resource properties[32] - The Çöpler mine in Türkiye temporarily suspended operations on June 21, 2022, due to a leach solution leak and restarted on September 22, 2022, after receiving required regulatory approvals[34] Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The Company's revenue, profitability, and future growth are substantially dependent on the volatile prices of gold, silver, lead, and zinc, which could materially adversely affect its financial position[35] - The Condensed Consolidated Financial Statements are prepared in accordance with Form 10-Q and should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2021[36] - ASU 2022-04, 'Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations,' issued in September 2022, is effective for fiscal years beginning after December 15, 2022, and is not expected to have a material impact on the Consolidated Financial Statements[38] Note 3. ACQUISITIONS AND DIVESTITURES - On April 14,