“Our Kensington gold mine in Alaska nearly tripled its production and cut its operating costs per ounce in half during the second quarter with the mine's return to full production, which represent key milestones for this important operation. We also saw higher silver and gold production levels and substantially lower costs at our Rochester mine in Nevada as a result of an expansion that took place in 2011. Our Palmarejo silver and gold mine in Mexico and our San Bartolomé silver mine in Bolivia both delivered consistent results during the second quarter. Despite industry-wide cost pressures, the Company delivered flat cash operating costs 1 per ounce during the second quarter, due mostly to efficiency improvements achieved at its key operations,” Krebs said.
1. EBITDA, operating cash flow, adjusted earnings and cash operating costs are non-GAAP measures. Please see tables in the Appendix for reconciliation to U.S. GAAP. Total debt includes short and long-term indebtedness and excludes capital leases and royalty obligations.
Table 1: Financial Highlights (Unaudited)
|US$ and silver ounces sold in millions (except per share amounts, average realized prices, and gold ounces sold)||2Q 2012||2Q 2011||QuarterVariance||YTD 2012||YTD 2011||YTDVariance|
|Sales of Metal||$||254.4||$||231.1||10||%||$||459.0||$||430.7||7||%|
|Adjusted Earnings (1)||28.0||58.0||(52||%)||69.4||95.6||(27||%)|
|Adjusted Earnings Per Share (1)||$||0.31||$||0.65||(52||%)||$||0.77||$||1.07||(28||%)|
|Earning Per Share||$||0.26||$||0.43||(40||%)||$||0.30||$||0.57||(47||%)|
|Operating Cash Flow (1)||88.4||115.8||(24||%)||182.2||206.0||(12||%)|
|Cash, Cash Equivalents, and Short Term Investments||200.3||107.3||87||%||200.3||107.3||87||%|
|Total Debt (1)||118.8||157.1||(24||%)||118.8||157.1||(24||%)|
|Weighted Average Shares Issued & Outstanding||89.6||89.3||—||%||89.6||89.3||—||%|
|Average Realized Price Per Ounce - Silver||$||29.28||$||39.11||(25||%)||$||30.72||$||35.42||(13||%)|
|Average Realized Price Per Ounce - Gold||$||1,610||$||1,504||7||%||$||1,646||$||1,430||15||%|
|Silver Ounces Sold||5.6||4.1||37||%||9.9||7.8||27||%|
|Gold Ounces Sold||59,579||49,930||19||%||98,464||115,852||(15||%)|
Net metal sales for the second quarter totaled $254.4 million, higher than both the second quarter of 2011 and the first quarter of 2012. This increase is due primarily to increased silver ounces sold year-over-year and higher gold production at Kensington and Rochester. Average realized prices per ounce of silver and gold were $29.28 and $1,610, respectively, in the second quarter, which were 25% lower and 7% higher, respectively, than the second quarter of 2011. Silver contributed 63.2% of the Company's total metal sales in the second quarter compared to 68.7% a year ago.
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