Coeur Mining, Inc. · NYSE:CDE
Coeur Mining — Denver Gold Forum 2014
42 slides from Coeur Mining's conference presentation, Sep 15, 2014
Slide 1: Denver Gold Forum
Denver Gold Forum Mitchell J. Krebs, President, Chief Executive Officer & Director September 14‐17, 2014 Hyatt Regency, Denver, Colorado Presentation: September 15 at 10:20 a.m. local time, Gavin Thomas Memorial Hall
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 production, costs, expenses, capital and exploration expenditures, amortization, and exploration and de
Slide 3: Key Investment Considerations
Key Investment Considerations Strategy to Maximize Net Cash Flow Over Production Disciplined Capital Deployment Strategy Recent Increase Well‐Capitalized with in Insider Stock Strong Liquidity Purchase Activity Multiple Organic Growth Opportunities and Growing Pipeline Declining Cost Structure and I
Slide 4: Leading Producer of Silver and Gold
Leading Producer of Silver and Gold 2013 Silver Equivalent Production by Mine (millions of ounces) Revenue by Metal 0.7 22% 36% 34% 40% 48% 6.9 Palmarejo Rochester 78% 14.6 64% 66% Gold San Bartolomé 60% 52% Silver 5.9 Kensington Endeavor 4.7 2009 2010 2011 2012 2013 Silver Production Gold Productio
Slide 5: Portfolio Includes 2 of the Top 15 Largest Primary Silver Mines
Portfolio Includes 2 of the Top 15 Largest Primary Silver Mines Kensington Mine, Alaska Silver Ounces Gold Ounces 2013: 114,821 oz Au Total1 (000s) (000s) 2014E: 107,000 ‐ 112,000 oz Au Proven & Probable Reserves 381,839 2,361 Measured & Indicated Resources 309,176 2,326 Inferred Resources 69,318 1,
Slide 6: Recent Goals and Achievements
Recent Goals and Achievements 2Q 2014 Rochester production increased 48% and Execute Rochester 13% for silver and gold, respectively, compared to production ramp up 1Q 2014 New stream agreement with Franco‐Nevada Reduce burden on expected to significantly improve mine’s cash flow Palmarejo’s cas
Slide 7: Business Profile and Strategy
Business Profile and Strategy Seeking to Create Balanced Pipeline of High‐Return, Low‐Risk Precious Metals Assets to Supplement Existing Asset Portfolio and Maximize Net Cash Flow Internal Pipeline External Pipeline Early Stage Development Acquisition Operating Assets Coeur Capital Exploration Proje
Slide 8: Financial Performance Highly Dependent on Metal Price
Financial Performance Highly Dependent on Metal Price Net Metal Sales Adjusted EBITDA1 $529 $1,021 $895 $ in millions $378 $ in millions $746 $515 $216 $189 $300 $70 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Historic Silver Price2 Historic Gold Price2 $50 $2,100 $45 $1,900 $40 $1,700 $35 $1,
Slide 9: CDE Provides Superior Leverage to Higher Metal Prices
CDE Provides Superior Leverage to Higher Metal Prices NPV Sensitivity to 10% Higher Silver Price Macro Factors Support Upside Metal Price Potential 70% Inflation concerns; geopolitical tensions Rising Asian demand from growing middle class Emerging uses for silver: ‐ Antimicrobials, mobile dev
Slide 10: Capex Significantly Reduced; G&A Expenses Trending Down
Capex Significantly Reduced; G&A Expenses Trending Down Capital Expenditures General & Administrative Expenses $400 $60 $320 $50 $240 $40 $ in millions $ in millions $160 $30 $80 $20 $0 $10 $0 2011 2012 2013 2014E ▪ No major capital projects in progress; 2014 capex forecast is primarily maintenance
Slide 11: Well-Capitalized with Financial Flexibility and Low Net Debt
Well‐Capitalized with Financial Flexibility and Low Net Debt Liquidity $269.1 $47.6 Net Debt = $163.3 Debt $468.6 $11.6 $0 $100 $200 $300 $400 $500 in millions Cash & Cash Equivalents Short‐term Investments Long‐term Debt Short‐term Debt As of June 30, 2014. Summary balance sheet (in millions) Sep 3
Slide 12: Rochester Ramp Up Continues at Lower Expected Costs
Rochester Ramp Up Continues at Lower Expected Costs Recent Accomplishments ~50% Silver Production Growth Expected in 2014 4,250 Ounces in thousands 126% increase in silver reserves in 2013 2,799 121% increase in gold reserves in 2013 Completed Stage 3 leach pad expansion Upgraded crusher cir
Slide 13: Palmarejo Cost Performance and LOM Assumptions
Palmarejo Cost Performance and LOM Assumptions Re‐scoped mine plan supports transition to higher‐margin, stronger‐cash flow operation 2011 2012 2013 2014E – 2021E Annual ore tons mined (in thousands) 1,729 2,164 2,323 887 OP mining costs per OP ton mined $2.54 $1.93 $1.63 $2.10 UG mining costs per U
Slide 14: La Preciosa Feasibility Study Adds Significant Reserves per Share
La Preciosa Feasibility Study Adds Significant Reserves per Share 600 534.0 523.5 500 450.6 448.7 ounces in millions 384.5 400 352.9 339.7 324.6 300 200 140.1 159.9 130.3 112.8 100 0 YE 2011 YE 2012 YE 2013 YE 2013 Pro‐Forma (Pre‐La Preciosa Feasibility) (Post‐La Preciosa Feasibility) AgEq P&P Reser
Slide 15: 2014 Guidance
2014 Guidance Silver Production Gold Production 7,603 6,850 Ounces in thousands 5,941 5,850 114,821 109,500 116,536 4,250 87,000 Ounces 2,799 30,860 36,000 669 550 Palmarejo San Bartolomé Rochester Endeavor Kensington Palmarejo Rochester 2013 Actual 2014 Guidance Midpoint 2013 Actual 2014 Guidance M
Slide 16: Key Investment Highlights
Key Investment Highlights Well‐capitalized with strong liquidity Balance Sheet Five operating assets in four Flexibility jurisdictions and growing pipeline Value‐Creating Asset Growth Diversity Conservative capital deployment including large exploration program near existing operations Operating Att
Slide 17: Appendix
Appendix
Slide 18: Summary Financial Performance
Summary Financial Performance in millions 2011 2012 2013 1Q 2014 2Q 2014 Revenue $1,021.2 $895.5 $746.0 $159.6 $164.6 Costs applicable to sales1 419.5 454.6 463.7 106.9 118.7 Exploration 19.1 26.3 22.4 4.2 5.2 General & administrative 31.4 33.0 55.3 13.9 9.4 Cash flow from operating activities 416.2
Slide 19: Cash Flow Protection Strategy
Cash Flow Protection Strategy Coeur continues to maintain a targeted cash flow protection program with the following objectives: Maintain simplicity Protect downside metal price exposure while retaining the upside potential Purchase put options to protect some of expected production against
Slide 20: Second Quarter 2014 Operational Highlights
Second Quarter 2014 Operational Highlights Palmarejo Rochester San Bartolomé Kensington • Cash flow from operating • Silver production 48% • Silver production increased • Gold production 10% higher activities 169% higher than higher than 1Q 2014 9% over 1Q 2014 than 1Q 2014 prior quarter • Costs app
Slide 21: Increasing Underground Ore and New Gold Stream Agreement at Palmarejo
Increasing Underground Ore and New Gold Stream Agreement Expected to Unlock Value at Palmarejo 2014 Expected Tons Milled 2014 Expected Operating Profit Higher proportion of 9% underground ore tons 35% expected to increase margins OP OP 65% UG UG 91% 2013 Cash Flow from Operations 2013 Cash Flow from
Slide 22: Palmarejo: Transitioning to Lower Tonnage, Higher-Grade, Higher-Margin Operation
Palmarejo: Transitioning to Lower Tonnage, Higher‐Grade, Higher‐Margin Operation $15.55 $14.97 $13.73 $13.39 $13.66 $13.36 $12.88 $12.89 $14.04 $11.51 $10.90 $10.36 2.7 2.5 2.4 2.3 2.0 1.9 2.0 1.8 1.8 1.8 1.6 1.6 35,486 ounces 34,108 29,815 31,081 31,258 29,893 23,702 28,191 22,965 25,216 23,706 19,
Slide 23: Rochester: Increased Silver and Gold Production Drives Highest Cash Flow
Rochester: Increased Silver and Gold Production Drives Highest Cash Flow in More than a Year $16.55 $15.74 $16.63 $15.74 $14.95 $15.79 $22.97 $12.73 $16.38 $15.15 $15.83 $12.67 $11.53 1,112 12,055 10,120 819 10,599 828 844 713 9,404 712 750 9,230 648 8,742 8,192 595 7,890 ounces 441 5,292 4,824 352
Slide 24: San Bartolomé: Expect Continued Stable Production and Costs in 2014
San Bartolomé: Expect Continued Stable Production and Costs in 2014 $14.14 $15.26 $13.06 $13.41 $13.25 $13.91 $13.93 $13.85 $11.34 $12.43 $10.65 $10.66 2.1 2.0 1.6 1.5 1.5 1.5 1.5 1.5 1.5 1.3 1.4 1.4 ounces 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 Silver production (mi
Slide 25: Kensington: Improving Stability of Production, Cash Flow, and Costs
Kensington: Improving Stability of Production, Cash Flow, and Costs $2,622 $1,005 $1,008 $1,482 $1,227 $677 $1,147 $1,013 $877 $1,120 $900 $894 36,469 28,717 28,323 28,089 25,687 24,391 25,206 25,428 21,572 22,583 ounces 13,299 7,444 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14
Slide 26: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted Net Income (Loss) in thousands of US$ 2Q 2014 1Q 2014 4Q 2013 3Q 2013 2Q 2013 Net income (loss) ($43,121) ($37,191) ($581,528) ($46,265) ($35,040) Fair value adjustments, net 6,498 7,827 (11,289) 13,717 (48,434) Stock‐based compensation 2,299
Slide 27: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted EBITDA EBITDA Reconciliation ($ in thousands) FY 2013 FY 2012 FY 2011 FY 2010 FY 2009 Net income (loss) ($650,563) $48,677 $93,499 ($91,308) ($27,066) (Gain) loss on sale of discontinued operations, ‐‐ ‐‐ ‐‐ 2,095 (25,537) net of income taxes
Slide 28: Non-GAAP to U.S. GAAP Reconciliation
Non‐GAAP to U.S. GAAP Reconciliation (unaudited) Adjusted EBITDA LTM LTM LTM LTM Adjusted EBITDA Reconciliation ($ in thousands) 6/30/14 3/31/14 12/31/13 9/30/13 Net income (loss) ($708,105) ($700,024) ($650,563) ($31,485) Interest expense, net of capitalized interest 46,006 44,625 41,303 34,915 Int
Slide 29: 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 2014 1Q 2014 4Q 2013 3Q 2013 2Q 2013 Costs applicable to sales, including amortization (U.S. GAAP) $159,036 $146,125 $163,701 $191,568 $198,966 Amortization 40,349 39,229 62,293 59,762 56,
Slide 30: 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 31: 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, 2013 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization (U.S. GAAP) $7
Slide 32: 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, 2013 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization $90,602 $37,639 $2
Slide 33: 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, 2012 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization $72,307 $19,24
Slide 34: 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, 2012 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization $105,127 $26,721 $
Slide 35: 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, 2011 Palmarejo Rochester Endeavor Total Kensington Bartolomé Costs applicable to sales, including amortization $89,428 $27,28
Slide 36: External Growth - Strategic Investments
External Growth ‐ Strategic Investments Apogee Silver (Pulacayo‐Paca project, Bolivia and Cachinal project, Chile; 6.4% ownership interest): Environmental Impact Assessment approved by Bolivia’s Ministry of Environment and Water Caracara Silver (Princesa project, Peru; 3.2% ownership interest)
Slide 37: Coeur's Mineral Reserves
Coeur’s Mineral Reserves Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Proven Reserves Rochester Nevada, USA 132,188,000 0.53 0.004 69,915,000 551,000 Martha Argentina ‐ ‐ ‐ ‐ ‐ San Bartolomé Bolivia 1,206,000 2.87 ‐ 3,456,000 ‐ Kensington Alaska, USA 309,000 ‐ 0.269
Slide 38: Coeur's Measured and Indicated Mineral Resources
Coeur’s Measured and Indicated Mineral Resources (Excluding Reserves) Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Measured Resources Rochester Nevada, USA 66,190,000 0.45 0.003 29,860,000 186,000 Martha Argentina — — — — — San Bartolomé Bolivia — — — — — Kensington
Slide 39: Coeur's Inferred Mineral Resources
Coeur’s Inferred Mineral Resources Grade (oz/ton) Ounces (contained) Location Short tons Silver Gold Silver Gold Inferred Resources Rochester Nevada, USA 37,365,000 0.62 0.003 23,295,000 101,000 Martha Argentina 204,000 4.75 0.005 969,000 1,000 San Bartolomé Bolivia 3,683,000 1.26 — 4,638,000 — Kens
Slide 40: Executive Leadership
Executive Leadership Mitchell J. Krebs – President and Chief Executive Officer. Mr. Krebs joined Coeur in 1995 after spending several years in the investment banking industry in New York. Mr. Krebs has held various positions in the corporate development department, including Senior Vice President of
Slide 41: 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 42: Contact Information
Contact Information Corporate Office: Coeur Mining, Inc. 104 S. Michigan Ave, Suite 900 Chicago, Illinois 60603 Main Tel: (312) 489‐5800 Stock Ticker: CDE: NYSE Warrant Tickers: CDE.WS: NYSE; CDM.WT: TSX Website: www.coeur.com Bridget Freas Donna Mirandola Director, Investor Relations Director, Corp