Coeur Mining, Inc. · NYSE:CDE
Coeur Mining — Raymond James New York Precious Metals Forum 2018
56 slides from Coeur Mining's conference presentation, January 2018
Slide 1: Raymond James New York Precious Metals Forum
Raymond James New York Precious Metals Forum January 2018 NYSE: CDE NYSE: CDE 1 JC 2016
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 the anticipated sale of the San Bartolomé mine, anticipated benefits (and financial impact) of the Silvertip acquis
Slide 3: Cautionary Statements (cont.)
Cautionary Statements (cont.) Coeur's management prepared certain unaudited financial projections, some portions of which are included in this presentation. These projections were prepared to give effect to the acquisition of the Silvertip project. These projections were not prepared with a view tow
Slide 4: Continuing to Advance Our Strategic Priorities
Continuing to Advance Our Strategic Priorities Record silver equivalent1 production Ramped-up to 4,500 tpd steady- Strong credit profile state mining rate at Palmarejo Mined We Pursue a Accelerated development ore investment in from Jualin deposit at Kensington Higher Standard results-oriented explo
Slide 5: Coeur's Rebalanced Precious Metals Asset Portfolio
Coeur’s Rebalanced Precious Metals Asset Portfolio… Asset Mix1 Geographic Mix1 Metal Mix1 (% production by mine) (% production by geography) (% production by metal) 100% 100% 100% 6% 3% 6% 11% 12% 11% 12% 4% 2% 2% 28% 15% 36% 80% 14% 80% 26% 80% 37% 58% 35% 18% 18% 57% 11% 60% 60% 60% 11% 20% 19% 47
Slide 6: Delivered Record Production in 2017
… Delivered Record Production in 2017… 2018 guidance1 reflects the continued evolution of the Company’s portfolio with the anticipated sale of San Bartolomé and recommencement of production at Silvertip, both expected in the first quarter Silver Equivalent2 Production and AISC3 (Production in M oz,
Slide 7: Driving Margins and Cash Flows Higher
… Driving Margins and Cash Flows Higher LTM Adjusted EBITDA1 LTM FCF2 ($M) ($M) $18.6 32.3% 24.1% 19.8% ($2.4) 14.5% $215.2 $172.1 ($20.9) $127.9 $92.0 87% ($59.1) 2014 2015 2016 3Q 2017 2014 2015 2016 3Q 2017 LTM adjusted EBITDA1 LTM adjusted EBITDA1 margin (1) Non-GAAP financial measure. See appli
Slide 8: Silvertip Expected to Recommence Production Late 1Q
Silvertip Expected to Recommence Production Late 1Q Silvertip is expected to contribute high-margin production and cash flow as well as accretive resource growth and long-term exploration potential Silvertip Amongst the highest-grade operations in the sector High-margin, low-cost source of produ
Slide 9: Track Record of Optimizing Operations
Track Record of Optimizing Operations Palmarejo • Acquisition of Paramount • Renegotiation of FNV stream in 2015 • Transition to 100% underground mining in 2016 • 40% and 71% increases in silver and gold grades, respectively, since 20141 • 31% reduction in unit costs since 20142 • 64% growth in 2017
Slide 10: Exploration Continues Targeting Higher Quality of Life
Exploration Continues Targeting Higher Quality of Life In 2017, Coeur accelerated its exploration activity, particularly at Palmarejo and Kensington, where encouraging drill results continued to support sustained higher investment Total Exploration Spend Drilling Activity ($M) (ft) Expensed $14.9 Ex
Slide 11: Refinancing Significantly Strengthened Balance Sheet
Refinancing Significantly Strengthened Balance Sheet Coeur successfully refinanced its 7.875% senior notes due 2021 with 5.875% senior notes due 2024 Total Debt Leverage Ratios ($M) $546.0 5.5x 47% 3.4x $288.9 1.7x Total debt-to-LTM adjusted EBITDA1 Net debt-to-LTM adjusted EBITDA1 0.3x 3Q 2015 3Q 2
Slide 12: ROIC Focus and Capital Allocation Priorities
ROIC Focus and Capital Allocation Priorities Higher Near-mine exploration Returns Organic growth opportunities After-tax hurdle rate 15% Acquisitions Repay debt 5.31% Company WACC1 Retain cash Lower on balance sheet Returns (1) Source(s): Bloomberg. Weighted average cost of capital as of most recent
Slide 13: Looking Ahead
Looking Ahead • Fourth quarter and full-year financial results reported on February 7, 2018, along with full-year 2018 cost guidance • Updated technical report for Wharf expected to be published concurrently with earnings, with an updated report for Rochester anticipated later in 1Q • Updated techni
Slide 14: 2017 Production Results and Cost Guidance
2017 Production Results and Cost Guidance1 2017 Production Results Silver (K oz) Gold (oz) AgEqOz2 (K oz) Guidance Result Guidance Result Guidance Result Palmarejo 6,500 – 7,000 7,242 110,000 – 120,000 121,569 13,100 – 14,200 14,536 Rochester 4,200 – 4,700 4,714 47,000 – 52,000 51,051 7,020 – 7,820
Slide 15: 2018 Production Guidance
2018 Production Guidance1 2018 Production Outlook Silver (K oz) Gold (oz) Zinc (K lbs) Lead (K lbs) AgEqOz2 (K oz) Palmarejo 6,500 – 7,100 110,000 – 115,000 - - 13,100 – 14,000 Rochester 4,200 – 4,700 45,000 – 50,000 - - 6,900 – 7,700 Kensington - 115,000 – 120,000 - - 6,900 – 7,200 Wharf - 85,000 –
Slide 16: Appendix
Appendix NYSE: CDE 16 JC 2016
Slide 17: Anticipated Financial Impact of Recent Transactions
Anticipated Financial Impact of Recent Transactions Revolving Credit Facility Rationale • Four-year $200 million senior secured revolving credit facility established; $100 million drawn in October to partially fund the acquisition of Silvertip, which closed on October 17, 2017 • Provides flexibility
Slide 18: Silvertip's Significant Existing Infrastructure
Silvertip’s Significant Existing Infrastructure Silvertip is a newly-constructed underground operation located 16 km south of the Yukon border and 90 km southwest of Watson Lake • 1,000 tpd processing facility • Newly-constructed dry stack tailings facility • 5 LNG generators • Current workforce of
Slide 19: Overview of Initial Silvertip Mine Plan
Overview of Initial Silvertip Mine Plan1 Operating Parameters2 Costs Assumptions2 Units LOM Units LOM Total ore production M tonnes 2.7 Pre-production capex US$M $25 - $35 Initial mine life Years 7.5 Sustaining capex US$M $55 - $65 Average production rate tpd 1,000 Operating costs Average annual pro
Slide 20: Notes to Initial Silvertip Mine Plan
Notes to Initial Silvertip Mine Plan Notes to the Silvertip summary mine plan: (a) This economic analysis is preliminary in nature and is based upon the current resource estimate as set out in this presentation which includes inferred mineral resources. Inferred resources are considered too speculat
Slide 21: Non-Core Asset Divestitures
Non-Core Asset Divestitures With the closing of the sale of the Endeavor stream and other non-core assets in 3Q, Coeur has opportunistically divested assets for total consideration of $65.1 million since the beginning of 2016 • Strengthens balance sheet • Non-core assets • Attractive valuation envir
Slide 22: Palmarejo
Palmarejo Ownership 100% Claims 112,520 net acres Type Underground Crushing, grinding, flotation, Processing agitation leaching, Merrill-Crowe precipitation, refining Metals Silver and gold doré Palmarejo Mine life ~5 years Chihuahua, Northern Mexico 2016 Share of Revenue 2016 Reserves and Resources
Slide 23: Palmarejo: Key Driver of Growth in 2017
Palmarejo: Key Driver of Growth in 2017 Transformation Background Transition to Underground Mining (excluding waste tons) • Negotiated more favorable gold stream in June 2014 Open-pit with Franco-Nevada Legacy underground Independencia • Acquired Paramount Gold for $146 million in April Guadalupe 20
Slide 24: Palmarejo Gold Stream Agreement Driving FCF Growth
Palmarejo Gold Stream Agreement Driving FCF1 Growth • More favorable gold stream agreement with Franco‐Nevada took effect in August 2016 – Applies to 50% of gold production from legacy Palmarejo land package – Franco‐Nevada to pay $800 per ounce vs. $416 per ounce under the old royalty agreement – N
Slide 25: Financial Statement Impacts of FNV Agreement
Financial Statement Impacts of FNV Agreement Previous Royalty Agreement Stream Agreement Income • 100% of gold sales recorded at spot • Gold sales to FNV recorded at $800 Statement prices per ounce plus deferred revenue • Fair value adjustments recorded to reflect changing gold prices on minimum oun
Slide 26: Rochester
Rochester Ownership 100% Claims 16,494 net acres Type Open pit and heap leach Crushing, dump heap leaching, Processing Merrill-Crowe precipitation, refining Rochester Metals Silver and gold doré Nevada, U.S. Mine life ~14 years 2016 Share of Revenue 2016 Reserves and Resources1 Grade (oz/t) Ounces (
Slide 27: Rochester: Scale-Driven Margin Expansion
Rochester: Scale-Driven Margin Expansion Transformation Highlights Tons Placed (M tons, excluding waste) • From 2013 to 2016, tons placed were increased at a CAGR of 17%, reaching 19.6 million in 2016 19.6 16.4 • Over the same period, AgEq1 production increased 14.7 16.4 64%, mining costs declined 4
Slide 28: Kensington
Kensington Ownership 100% Claims 12,336 net acres Type Underground Kensington Crushing, grinding, flotation Alaska, U.S. Processing processing Metals Gold concentrate Mine life ~5 years 2016 Share of Revenue 2016 Reserves and Resources1 Grade (oz/t) Ounces (contained) Short tons Silver Gold Silver G
Slide 29: Kensington: Grades Expected to Deliver
Kensington: Grades Expected to Deliver Transformation Highlights Tons Milled • From 2012 to 2016, tons milled increased 57% as 660,464 668,727 mill feed increased from less than 1,300 tpd to 635,960 620,209 approximately 1,900 tpd, exceeding nameplate 553,717 capacity • Over the same period, CAS per
Slide 30: Wharf
Wharf Ownership 100% Claims 7,551 net acres Type Open pit and heap leach Crushing, “on-off” heap leaching, Processing spent ore neutralization, carbon Wharf South Dakota, U.S. absorption/desorption Metals Electrolytic cathodic sludge Mine life ~5 years 2016 Share of Revenue 2016 Reserves and Resourc
Slide 31: Wharf: Solid Source of FCF
Wharf: Solid Source of FCF1 Overview Cumulative FCF1 ($M) $113.3 • Coeur’s lowest-cost and highest FCF1 mine $101.4 $94.1 • Acquired from Goldcorp in 2015 for $99 million in $86.4 cash and has since generated $113.3 million in $72.3 cumulative FCF1 through 3Q 2017 $51.8 • Production decline in 2017
Slide 32: San Bartolomé
San Bartolomé Wholly-owned (long-term mineral Ownership rights leases with COMIBOL) Claims 4,054 net acres • As announced on December 22, 2017, Coeur has Type Surface mining, free-digging entered into an agreement to sell its wholly-owned subsidiary that owns San Bartolomé. The transaction Crushing,
Slide 33: Non-GAAP to U.S. GAAP Reconciliation
Non-GAAP to U.S. GAAP Reconciliation Unaudited Adjusted Net Income (Loss) ($ thousands) 3Q 2017 2Q 2017 1Q 2017 2016 4Q 2016 3Q 2016 2015 2014 Net income (loss) ($16,652) ($10,955) $18,663 $55,352 ($8,306) $69,557 ($367,183) ($1,186,874) Fair value adjustments, net - (336) 1,200 11,581 (1,654) 961 (
Slide 34: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited Adjusted EBITDA ($ thousands) 3Q 2017 2Q 2017 1Q 2017 2016 4Q 2016 3Q 2016 2015 2014 Net income (loss) ($16,652) ($10,955) $18,663 $55,352 ($8,306) $69,557 ($367,183) ($1,186,874) Interest expense, net of capitalized interest 3,606 3,749 3,586 3
Slide 35: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited LTM Adjusted EBITDA ($ thousands) 3Q 2017 2Q 2017 1Q 2017 4Q 2016 3Q 2016 2Q 2016 1Q 2016 4Q 2015 Net income (loss) $(17,250) $68,959 $94,411 $55,352 ($239,342) ($323,118) ($354,292) ($367,183) Interest expense, net of capitalized interest 17,79
Slide 36: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited Consolidated Free Cash Flow ($ thousands) 3Q 2017 2Q 2017 1Q 2017 2016 4Q 2016 3Q 2016 2015 2014 Cash flow from operating activities $29,432 $29,279 $55,271 $125,817 $25,449 $47,812 $113,542 $53,548 Capital expenditures (29,461) (37,482) (23,979
Slide 37: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 9 months ended September 30, 2017 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S.
Slide 38: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 3 months ended September 30, 2017 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S.
Slide 39: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 3 months ended June 30, 2017 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S. GAAP
Slide 40: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 3 months ended March 31, 2017 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S. GAA
Slide 41: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited Year ended December 31, 2016 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S. GAAP
Slide 42: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 3 months ended December 31, 2016 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S.
Slide 43: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited 3 months ended September 30, 2016 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S.
Slide 44: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited Year ended December 31, 2015 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortization (U.S. GAAP
Slide 45: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Costs Applicable to Sales Unaudited Year ended December 31, 2014 Silver Gold San ($ thousands, except per ounce amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Total Costs applicable to sales, including amortization (U.S. GAAP) $256,707 $
Slide 46: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited All-in Sustaining Costs YTD ($ thousands, except per ounce amounts) 3Q 2017 3Q 2017 2Q 2017 1Q 2017 2016 4Q 2016 3Q 2016 2015 2014 Costs applicable to sales $377,255 $118,922 $125,621 $132,712 $409,541 $102,112 $105,408 $479,654 $477,945 Treatme
Slide 47: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited All-in Sustaining Costs per Silver Equivalent Ounce for 2017 Guidance Silver Gold ($ thousands, except per ounce San amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, including amortiza
Slide 48: Non-GAAP to U.S. GAAP Reconciliation (cont.)
Non-GAAP to U.S. GAAP Reconciliation (cont.) Unaudited All-in Sustaining Costs per 70:1 Spot Silver Equivalent Ounce for 2017 Guidance Silver Gold ($ thousands, except per ounce San amounts) Palmarejo Rochester Bartolomé Endeavor Total Kensington Wharf Total Total Costs applicable to sales, includin
Slide 49: Average Spot Equivalence
Average Spot Equivalence Average Spot Prices 2017 4Q 2017 3Q 2017 2Q 2017 1Q 2017 2016 4Q 2016 3Q 2016 2015 2014 Average silver spot price per ounce $17.05 $16.73 $16.84 $17.21 $17.42 $17.14 $17.19 $19.61 $15.68 $19.08 Average gold spot price per ounce $1,257 $1,275 $1,278 $1,257 $1,219 $1,251 $1,22
Slide 50: Reserves and Resources
Reserves and Resources 2016 Proven and Probable Mineral Reserves Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Proven Reserves Palmarejo Mexico 1,569,000 4.44 0.080 6,971,000 126,000 Rochester Nevada, USA 143,686,000 0.48 0.004 68,369,000 503,000 Kensington Alaska, US
Slide 51: Reserves and Resources (cont.)
Reserves and Resources (cont.) 2016 Measured and Indicated Mineral Resources (excluding Reserves) Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Measured Resources Palmarejo Mexico 818,000 3.20 0.061 2,618,000 50,000 Rochester Nevada, USA 39,732,000 0.59 0.003 23,281,0
Slide 52: Reserves and Resources (cont.)
Reserves and Resources (cont.) 2016 Inferred Mineral Resources Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Inferred Resources Palmarejo Mexico 4,726,000 4.35 0.055 20,540,000 258,000 Rochester Nevada, USA 67,778,000 0.52 0.003 35,554,000 178,000 Kensington Alaska, U
Slide 53: Reserves and Resources (cont.)
Reserves and Resources (cont.) Silvertip Resource Estimates Tonnage Silver Zinc Lead Silver Equivalent tonnes tons g/t oz/t % % g/t oz/t Indicated 2,349,000 2,589,326 352 10.27 9.41 6.73 1,166 34.01 Inferred 460,000 507,063 343 10.00 9.81 6.18 1,155 33.68 Notes to the Silvertip mineral resource esti
Slide 54: 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 55: 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 b
Slide 56: Contact Information
Contact Information Corporate Office Coeur Mining, Inc. 104 S. Michigan Ave., Suite 900 Chicago, IL 60603 Main Telephone +1 (312) 489-5800 Stock Ticker CDE: NYSE Website www.coeur.com Contact Courtney R. B. Lynn VP, Investor Relations & Treasurer investors@coeur.com NYSE: CDE 56 JC 2016
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