Coeur Mining, Inc. · NYSE:CDE
Coeur Mining — Jefferies Industrials Conference 2015
46 slides from Coeur Mining's conference presentation, Aug 12, 2015
Slide 1: Jefferies Industrials Conference
Jefferies Industrials Conference Peter C. Mitchell, Sr. Vice President and Chief Financial Officer New York, New York August 12, 2015
Slide 2: Cautionary Statements
Cautionary Statements This presentation contains forward-looking statements within the meaning of securities legislation in the United States and Canada, including statements regarding anticipated repositioning, cash flow, returns, production, costs, grades, margins, the development of the Jualin de
Slide 3: Investment Considerations
Investment Considerations Diversified portfolio of silver and gold assets Well-advanced repositioning which may not be fully appreciated in the market Executing strategy to reduce costs, improve returns, and drive significant future free cash flow Palmarejo Rochester Kensington San Bartolomé W
Slide 4: Leading Producer of Silver and Gold
Leading Producer of Silver and Gold 2014 Silver Equivalent Production by Mine (millions of ounces) Revenue by Metal 0.6 22% 36% 34% 40% 48% 48% 7.1 Palmarejo 11.8 Rochester 78% 64% 66% Gold San Bartolomé 60% 52% 52% Silver 5.9 Kensington Endeavor 6.9 2009 2010 2011 2012 2013 2014 Production 40.0 33.
Slide 5: Portfolio Includes 2 of the Top 15 Largest Primary Silver Mines
Portfolio Includes 2 of the Top 15 Largest Primary Silver Mines Ticker: Exchange CDE: NYSE Kensington Mine, Alaska Shares Outstanding1 137.1M 2014: 11,823 oz Au 2015E: 115,000 - 125,000 oz Au Avg. Daily Volume1 $8.4M Wharf Mine, South Dakota 2015E: 74,000 – 78,000 oz Au 52-week Low – High1 $2.67 – $
Slide 6: Coeur's Repositioning is Significant and is Well Underway
Coeur’s Repositioning is Significant and is Well Underway Coeur is now positioned to deliver near-term, quality growth in production and free cash flow with costs expected to drop to among the lowest in the industry in 2017 Coeur Coeur 2014 2017 Silver Equivalent Production (millions of ounces) 32 4
Slide 7: Three-year Company Outlook
Three-year Company Outlook AgEq Production Profile All-in Sustaining Costs1 50.0 25 40.0 – 45.0 $19.23 $17.00 - $18.00 40.0 33.1 – 35.9 35.0 – 37.0 20 $16.50 - $17.50 $ per AgEq ounce 32.2 $14.00 - $15.00 30.0 15 oz million 20.0 10 10.0 5 0.0 0 2014A 2015E 2016E 2017E 2014A 2015E 2016E 2017E Adjuste
Slide 8: Creating Value & Mitigating Risk Through Diversification
Creating Value & Mitigating Risk Through Diversification More balanced metals mix Long and Improved varied country mine lives Diversified risk profile portfolio of precious metals assets Increased Creating number of project operating pipeline assets NYSE: CDE 8
Slide 9: Creating Value Irrespective of Silver & Gold Prices
Creating Value Irrespective of Silver & Gold Prices Nearly all new management in past 2.5 Revamped years Revamped Board of corporate Directors organization Under-appreciated Recent and well-advanced Restructured acquisition repositioning & reduced activity FNV expected to accelerate obligation at re
Slide 10: Significant Cost Reductions Achieved in 2Q 2015
Significant Cost Reductions Achieved in 2Q 2015 7% - 9% Decrease in Adj. CAS per AgEq oz1 Across All Mines Compared with 1Q 2015 $14.56 $14.47 $797 $13.21 $13.26 $ per AgEq oz $12.95 $ per gold oz $745 $12.01 Palmarejo Rochester San Bartolomé Kensington 1Q'15 2Q'15 Companywide Adj. Costs Applicable
Slide 11: Well-Capitalized with Financial Flexibility
Well-Capitalized with Financial Flexibility Debt maturity schedule Amount Maturity (millions) Liquidity $205.9 Net Debt = $341.8 Senior unsecured notes $426.2 2021 Convertible notes $0.7 2028 Term Loan B $94.7 2020 Debt $539.6 $8.1 San Bartolomé letter of credit $0.5 2017 San Bartolomé letter of cre
Slide 12: High-Quality Ounces Added to Production Pipeline
High-Quality Ounces Added to Production Pipeline 484.2 437.4 390.7 AgEq oz in millions 292.4 282.8 292.7 136.6 144.6 127.0 Year-end 2014 4/23/15 Independencia update 6/1/15 Wharf update P&P Reserves M&I Resources Inferred Resources Acquisitions of Paramount and Wharf Lead to a 24% Increase in Proven
Slide 13: Anticipated Milestones and Upcoming News Flow
Anticipated Milestones and Upcoming News Flow 3Q 2015 4Q 2015 1Q 2016 Complete expanded crushing Underground Complete capacity and increased Stage III development reaches underground mining leach pad capacity at Rochester Independencia at legacy Palmarejo mine 3Q 2015 4Q 2015 1Q 2016 3Q 2015 3Q 2015
Slide 14: Appendix
Appendix
Slide 15: Coeur Asset Detail
Coeur Asset Detail
Slide 16: Palmarejo: World's 9th Largest Silver Mine
Palmarejo: World’s 9th Largest Silver Mine Overview Location Temoris, Chihuahua, Mexico Ownership 100% Land position 30,471 acres Start up April 2009 Initial capex $378 million Mine type Underground and open-pit Mining method Conventional open-pit and longhole Ore processing Crushing Recent Highligh
Slide 17: Palmarejo: Transitioning to Lower Tonnage, Higher-Grade Operation
Palmarejo: Transitioning to Lower Tonnage, Higher-Grade, Higher-Margin Operation $15.70 $14.43 $14.56 $27.4 $13.48 $13.21 $20.2 1.8 $ in millions 1.5 1.4 1.4 1.2 23,706 22,514 $10.9 $9.7 $10.7 $9.2 18,127 ounces 15,237 15,495 $5.6 $5.9 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 ($0.2) ($3.2) 2Q'14 3Q'14 4Q'14 1Q
Slide 18: Rochester: 2nd Largest Primary Silver Mine in the U.S.
Rochester: 2nd Largest Primary Silver Mine in the U.S. Overview Location Lovelock, Nevada Ownership 100% Land position 10,800 acres Start up October 1986 Initial capex $24 million Mine type Open-pit Mining method Conventional open-pit Ore processing Crushing Recent Highlights Metal recovery Heap lea
Slide 19: Rochester: Lower Mining and Leaching Costs Drive Lower CAS
Rochester: Lower Mining and Leaching Costs Drive Lower CAS per AgEq oz1 $15.73 $13.82 $14.78 $12.95 $12.01 $16.4 1.3 1.2 1.2 1.1 1.1 $ in millions 15,764 16,411 $10.2 $8.8 ounces 11,702 13,721 $8.2 9,230 $5.9 $4.3 $4.0 $4.2 $2.7 $3.3 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Adj CA
Slide 20: Kensington: 100% Pure Gold Mine
Kensington: 100% Pure Gold Mine Overview Location 45 miles NNW of Juneau, Alaska Ownership 100% Land position 12,393 acres Start up June 2010 Initial capex $425 million Mine type Underground Mining method Longhole stoping Ore processing Primary and secondary ball mills Recent Highlights Metal recove
Slide 21: Kensington: Strong Mill Throughput and Lower Costs
Kensington: Strong Mill Throughput and Lower Diesel and Mining Costs $792 $821 $889 $797 $745 $17.0 33,533 33,909 $12.3 $12.0 30,773 29,845 28,089 $ in millions ounces $4.1 $4.7 $4.0 $3.6 $3.9 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 ($0.6) ($3.7) 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Adj. CAS per gold oz 1 Gold produ
Slide 22: Wharf: The Newest Addition to Coeur's Portfolio
Wharf: The Newest Addition to Coeur’s Portfolio Overview Location Lead, South Dakota Ownership 100% Land position 5,212 acres Start up June 2008; Mine type Open-Pit Mining method Conventional open-pit Ore processing Crushing Recent Highlights Metal recovery Heap leach ▪ 2Q 2015 was the first full qu
Slide 23: Wharf: First Full Quarter of Operating Results
Wharf: First Full Quarter of Operating Results Since Acquisition $970 16,794 $8.2 $ in millions ounces 6,609 $1.2 $0.1 1Q'15 1 2Q'15 ($7.2) 1Q'15 2Q'15 2 Adj. CAS per AuEq oz Gold Equivalent Production Cash flow from operating activities Capital expenditures 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014 O
Slide 24: San Bartolomé: One of the World's Largest Pure Silver Mines
San Bartolomé: One of the World’s Largest Pure Silver Mines Overview Location Potosi, Bolivia Ownership 100%1 Land position 4,500 acres (and 8,600 acres at Rio Blanco) Start up June 2008; Initial capex $238 million Mine type Surface Mining method Free-digging Ore processing Crushing Recent Highlight
Slide 25: San Bartolomé: Continued Stable Cost Performance
San Bartolomé: Continued Stable Cost Performance $13.85 $14.38 $14.47 $13.67 $13.26 $18.9 $ in millions 1.5 1.5 1.5 1.5 $12.3 1.2 ounces $5.4 $5.0 $2.8 $2.3 $2.0 $1.7 $0.9 $1.0 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Adj CAS per AgEq oz 1 Silver production (millions) Cash flow fr
Slide 26: 2015 Guidance Improved
2015 Guidance Improved Silver Production Gold Production 6,558 114,821 120,000 Ounces in thousands 5,852 5,400 4,450 4,850 4,189 86,673 76,000 Ounces 64,500 60,000 30,860 590 550 Palmarejo San Bartolomé Rochester Endeavor Kensington Palmarejo Rochester Wharf 2014 Actual 2015 Guidance Midpoint 1 2014
Slide 27: Silver and Gold Fundamentals
Silver and Gold Fundamentals
Slide 28: Gold: Fundamentals Remain Intact
Gold: Fundamentals Remain Intact Gold remains a store of value and an important component to any diverse portfolio ▪ Jewelry represents nearly 60% of global demand – the majority from China and India ▪ Dramatic reduction in ETF holdings over the past two years ▪ Central Bank purchases remain robust
Slide 29: Silver: "Green Shoots" for a Green Metal
Silver: “Green Shoots” for a Green Metal Despite high correlation with gold, nearly 60% of total demand from industrial applications ▪ Mine production set to decline meaningfully ▪ Scrap supply at twenty year low ▪ ETF holdings remain strong ▪ Expanding and diverse demand in electronics, solar panel
Slide 30: Silver Supply & Demand Overview
Silver Supply & Demand Overview World Silver Supply World Silver Demand Industrial Applications Photography Mine Production Net Government Sales Jewelry Silverware Scrap Net Producer Hedging Coins & Bars Producer De-Hedging 1,200 1,200 1,000 1,000 800 800 Million ounces Million ounces 600 600 400 40
Slide 31: Update on Silver End-Market Demand
Update on Silver End-Market Demand 2005 2014 Investment 7% Investment Jewelry & 18% Silverware Industrial 27% 49% Jewelry & Industrial Silverware 52% 26% Photography 17% Photography 4% Practical Applications of Silver Solar panels Jet engines Ethylene oxide Water purification Computers C
Slide 32: 10-Year Gold and Silver Price History
10-Year Gold and Silver Price History $3,000 $50 $2,700 $45 $2,400 $40 $2,100 $35 Silver Price US$ Gold Price US$ $1,800 $30 $1,500 $25 $1,200 $20 $900 $15 $600 $10 $300 $5 Source: Bloomberg. As of August 6, 2015. Gold Silver NYSE: CDE 32
Slide 33: Non-GAAP Reconciliations and Other
Non-GAAP Reconciliations and Other
Slide 34: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted Net Income (Loss) in thousands 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014 Net income (loss) ($16,677) ($33,287) ($1,079,038) $3,466 ($43,121) Fair value adjustments, net (2,618) 4,339 (5,622) (13,026) 6,498 Stock-based compensation 2,529 2,410 1
Slide 35: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted EBITDA in thousands 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014 Net income (loss) ($16,677) ($33,287) ($1,079,038) $3,466 ($43,121) Interest expense, net of capitalized interest 10,734 10,765 10,566 11,615 12,311 Interest income and other, net 2,
Slide 36: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) LTM Adjusted EBITDA in thousands LTM 6/30/15 LTM 3/31/15 LTM 12/31/14 LTM 9/30/14 LTM 6/30/14 Net income (loss) ($1,125,536) ($1,151,980) ($1,155,884) ($658,374) ($708,105) Interest expense, net of capitalized interest 43,680 45,257 47,546 47,959 46,0
Slide 37: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total Total Three months ended June 30, 2015 Palmarejo Rochester Endeavor Kensington Wharf Total Gold Bartolomé Silver Costs applicable to sales, including amortiz
Slide 38: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total three months ended December 31, 2014 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $6
Slide 39: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) Costs Applicable to Sales Silver Gold (dollars in thousands except per ounce costs) San Total three months ended June 30, 2014 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $67,59
Slide 40: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation (unaudited) All-In Sustaining Costs in thousands except per ounce costs 2Q 2015 1Q 2015 4Q 2014 3Q 2014 2Q 2014 FY 2014 Costs applicable to sales, including amortization (U.S. GAAP) $164,125 $146,742 $163,679 $166,675 $159,036 $635,516 Amortization 45,028 31,680
Slide 41: Coeur's Mineral Reserves
Coeur’s Mineral Reserves Grade (oz/ton) Ounces (contained) Year-end 2014 Location Short tons Silver Gold Silver Gold Proven Reserves Rochester Nevada, USA 89,077,000 0.56 0.004 49,786,000 346,000 San Bartolomé Bolivia 1,206,000 2.73 - 3,287,000 - Kensington Alaska, USA 417,000 - 0.187 - 78,000 Endea
Slide 42: Coeur's Measured and Indicated Mineral Resources
Coeur’s Measured and Indicated Mineral Resources (Excluding Reserves) Grade (oz/ton) Ounces (contained) Year-end 2014 Location Short tons Silver Gold Silver Gold Measured Resources Rochester Nevada, USA 72,228,000 0.45 0.003 32,565,000 218,000 Martha Argentina - - - - - San Bartolomé Bolivia - - - -
Slide 43: Coeur's Inferred Mineral Resources
Coeur’s Inferred Mineral Resources Grade (oz/ton) Ounces (contained) Year-end 2014 Location Short tons Silver Gold Silver Gold Inferred Resources Rochester Nevada, USA 96,039,000 0.42 0.003 40,789,000 263,000 Martha Argentina 204,000 4.75 0.005 969,000 1,000 San Bartolomé Bolivia 66,000 1.68 - 111,0
Slide 44: Executive Leadership
Executive Leadership Mitchell J. Krebs – President and Chief Executive Officer. During his twenty year tenure with Coeur, Mr. Krebs has led nearly $2 billion in capital raising and debt restructuring activities and has facilitated over $2 billion of acquisitions and divestitures. Mr. Krebs was previ
Slide 45: Board of Directors
Board of Directors Robert E. Mellor – Former Chairman, Chief Executive Officer and President of Building Materials Holding Corporation (distribution, manufacturing and sales of building materials and component products) from 1997 to January 2010, director from 1991 to January 2010; member of the boa
Slide 46: Contact Information
Contact Information Corporate Office: Coeur Mining, Inc. 104 S. Michigan Ave, Suite 900 Chicago, Illinois 60603 Main Tel: (312) 489-5800 Stock Tickers: CDE: NYSE Warrant Tickers: CDE.WS: NYSE; CDM.WT: TSX Website: coeur.com Contact: Bridget Freas Donna Mirandola Director, Investor Relations Director