Stillwater Mining Company (NYSE:SWC) today
reported financial results for the quarter ended March 31, 2015.
First Quarter 2015 Highlights:
- Consolidated net income attributable to common stockholders of
$23.0 million or $0.17 per diluted share, an increase of 17.5% over
the first quarter of 2014
- Increase in cash and cash equivalents plus highly liquid
investments of $9.7 million from the prior quarter, ending the
first quarter of 2015 with $541.2 million
- All-in Sustaining Costs (AISC)* of $763 per mined ounce of
palladium and platinum, compared to $788 per mined ounce for the
first quarter of 2014
- General and administrative expenses of $8.3 million, a decrease
of 14.7% from the first quarter of 2014
- Mined palladium and platinum production of 133,300 ounces, an
increase from 130,700 ounces for the first quarter of 2014
- Processed 108,700 ounces of recycled palladium, platinum and
rhodium, an increase of 7.1% over 101,500 ounces recycled during
the first quarter of 2014
Commenting on the 2015 first quarter results, Mick McMullen, the
Company's President and Chief Executive Officer stated, "There were
both positive and challenging aspects to the first quarter of 2015.
Mine production was strong at 133,300 ounces, at the high end of
our guidance range. Cash and investments continued to grow,
although not at a rate we would prefer. We ended the quarter with
$541.2 million of cash and liquid investments. General and
administrative costs were reduced further to $8.3 million for the
quarter, which was at the low end of guidance. We made significant
progress in the recycling business by signing two long-term
contracts providing us with new material deliveries that have
started in the second quarter. The labor agreement with employees
at the Stillwater Mine and the Columbus processing facility is
scheduled to expire on June 1, and negotiations that began during
the first quarter regarding a new contract are ongoing.
"First quarter 2015 AISC of $763 per mined ounce was better than
the first quarter of last year but up from a very good result of
$725 for the fourth quarter of 2014. We remain focused on driving
these costs back down to our stated goal of AISC in the low $700
per ounce range. We are confident there are additional
opportunities to further reduce operating costs and we intend to
capitalize on those opportunities.
"Metal prices continued to be a headwind during the quarter. Our
first quarter average realized basket price for mined palladium and
platinum was $871 per ounce. This is down from $907 reported for
the first quarter of last year and down sequentially from $882
reported for the fourth quarter of 2014. Our basket price today is
approximately $877 per ounce. The price volatility continues to
demonstrate the need to improve cost efficiency within the
organization. We are striving to create a lean cost structure to
provide the necessary flexibility to manage through the volatile
cycles of fluctuating metals prices," concluded Mr. McMullen.
First quarter 2015 consolidated net income attributable to
common stockholders was $23.0 million, or $0.17 per diluted share;
the comparable first quarter of 2014 consolidated net income
attributable to common stockholders was $19.6 million, or $0.15 per
diluted share. The first quarter of 2015 was impacted by lower
costs and increased mine production, offset by lower realized
prices and a $4.8 million decline in foreign currency effects,
mostly attributable to the Company's Argentine assets.
2015 Full-Year Guidance:
Following a review of first quarter 2015 results and forecasts
for the remainder of the year, guidance for the full-year 2015
remains unchanged and is detailed in the table below.
|
2015 Guidance |
Mined Production (palladium and platinum
ounces) |
520,000 - 535,000 |
Total Cash Costs per Mined Ounce (net of
by-product and recycling credits)* |
$480 - $520 |
All-In Sustaining Costs per Mined
Ounce*(1) |
$730 - $780 |
General and Administrative
(millions) |
$30 - $40 |
Exploration (millions)(2) |
$4 - $6 |
Sustaining Capital Expenditures
(millions) |
$83 - $88 |
Project Capital Expenditures
(millions)(3) |
$42 - $47 |
Total Capital Expenditures (millions)(3) |
$125 - $135 |
|
|
(1) All-in sustaining costs per
mined ounce guidance for 2015 assumes the exclusion of
approximately $24 per ounce recycling credit and approximately $11
per ounce for foreign activities. |
(2) Exploration includes expenses
for Marathon, Altar and Montana operations. |
(3) Excludes project capitalized
interest and capitalized depreciation. |
Mine production in the first quarter of 2015 was 133,300 ounces
of palladium and platinum; this was up slightly compared to mine
production of 130,700 ounces in the first quarter of 2014. The
change in total mined ounces was driven by an increase in
production at the East Boulder Mine, reflecting the Graham Creek
development area coming on-line and the benefit of adding an
additional crew at the East Boulder mill in late 2014. This
increase was partially offset by reduced output at the Stillwater
Mine due to the planned deferral of production in some mining
stopes until new infrastructure is in place to improve the
profitability of mining in those areas.
Mine Production Comparison:
(Produced ounces) |
2015 First
Quarter |
2014 First Quarter |
Palladium |
64,500 |
68,900 |
Platinum |
19,200 |
20,800 |
Stillwater Mine Total |
83,700 |
89,700 |
|
|
|
Palladium |
38,700 |
31,900 |
Platinum |
10,900 |
9,100 |
East Boulder Mine Total |
49,600 |
41,000 |
|
|
|
Palladium |
103,200 |
100,800 |
Platinum |
30,100 |
29,900 |
Total |
133,300 |
130,700 |
|
|
|
Revenue from the Company's Mine Production segment, (including
proceeds from the sale of by-products) totaled $125.7 million, in
both the first quarter of 2015 and the first quarter of 2014. The
2015 combined average realized price for the sales of mined
palladium and platinum decreased for the first quarter to $871 per
ounce, compared to $907 per ounce realized in the first quarter of
2014. The total quantity of mined palladium and platinum sold in
the first quarter of 2015 was 136,700 ounces compared to 131,300
ounces sold in the same period of 2014.
Total costs of metals sold (before depletion, depreciation and
amortization, and corporate overhead expenses) decreased 9.5% to
$152.7 million in the first quarter of 2015 from $168.8 million in
the first quarter of 2014. Mine Production costs included in costs
of metals sold increased to $80.0 million in the 2015 first quarter
from $78.0 million in the 2014 first quarter.
Recycling material processed during the first quarter of 2015
contained 108,700 ounces of palladium, platinum and rhodium, an
increase of 7.1% from the total of 101,500 ounces processed during
the first quarter of 2014. As a result of customer mix during the
first quarter of 2015, the proportion of ounces processed on a toll
basis increased compared to purchased ounces.
Recycling Activity Comparison:
|
2015 First
Quarter |
2014 First Quarter |
Average tons of catalyst fed per day |
16.1 |
17.0 |
PGM ounces fed |
108,700 |
101,500 |
PGM ounces sold |
74,600 |
93,600 |
PGM tolled ounces returned |
40,200 |
15,300 |
|
|
|
PGM Recycling revenue totaled $74.7 million for the 2015 first
quarter, a decrease from $93.5 million in the same period of 2014.
This decrease was a result of the shift from purchased to tolled
ounces processed. The Company's combined average realized price for
sales of recycled palladium, platinum and rhodium was $981 per
ounce in the first quarter of 2015 compared to $980 per ounce in
the first quarter of 2014. Recycling sales volumes for the first
quarter of 2014 decreased to 74,600 ounces from 93,600 ounces sold
in the first quarter of 2014.
PGM Recycling costs totaled $72.7 million in the first quarter
of 2015, down from the $90.7 million reported in the first quarter
of 2014. This decrease was primarily due to the shift from
purchased to tolling ounces processed during the quarter, as
overall contained ounces volume increased.
General and administrative costs were $8.3 million in the first
quarter of 2015 compared to $9.8 million incurred during the same
period of 2014.
The 2015 first quarter earnings reflect a discrete income tax
benefit of approximately $8.6 million related to the establishment
of SWC Trading Inc. to manage the Company's sales and trading
activities.
All-In Sustaining Costs Per Mined Ounce
All-in Sustaining Costs per Mined Ounce (AISC)* totaled $763 for
the first quarter of 2015, a decrease from $788 recorded for the
same period of 2014.
All-In Sustaining Costs Per
Mined Ounce Combined Montana Mining Operations |
2015 First
Quarter |
2014 First Quarter |
Reported Total Cash Costs per Mined Ounce
(Net of Credits)* |
$ 537 |
$ 568 |
PGM Recycling Income
Credit |
16 |
24 |
Corporate General &
Administrative Costs (Before DD&A) |
58 |
59 |
Capital Outlay to Sustain
Production at the Montana Operating Mines |
152 |
137 |
All-In Sustaining Costs per Mined Ounce* |
$ 763 |
$ 788 |
|
|
|
Cash Costs Per Mined Ounce
Combined Total Cash Costs per Mined Ounce (net of by-product and
recycling credits)* averaged $537 per ounce for the first quarter
of 2015, compared to $568 per ounce for the first quarter of 2014.
The table below illustrates the effect of by-product and recycling
credits on the total cash costs per mined ounce, net of credits,
for the combined Montana mining operations.
Cash Costs Per Mined Ounce
Combined Montana Mining Operations |
2015 First
Quarter |
2014 First Quarter |
Reported Total Cash Costs per Mined Ounce
(Net of Credits)* |
$ 537 |
$ 568 |
By-Product Revenue Credit |
51 |
51 |
PGM Recycling Income
Credit |
16 |
24 |
Total Cash Costs per Mined Ounce (Before
Credits)* |
$ 604 |
$ 643 |
|
|
|
Cash Flow and Liquidity
At March 31, 2015, the Company's consolidated available cash
balance was $262.6 million, compared to $280.3 million at December
31, 2014. The Company's cash and cash equivalents plus highly
liquid investments totaled $541.2 million at March 31, 2015, an
increase of $9.7 million from $531.5 million at December 31, 2014.
Net working capital increased to $625.1 million at March 31, 2015,
from $619.4 million at the end of 2014.
Net cash provided by operating activities (which includes
changes in working capital) totaled $38.3 million for the quarter
ended March 31, 2015, compared to $4.8 million of cash provided for
the same period of 2014. A significant driver of the improvement
was the timing of metal sales and the related payments during the
quarter. Cash capital expenditures were $27.9 million for the
quarter ended March 31, 2015, compared to $26.1 million in the same
period of 2014.
Outstanding total balance sheet debt reported at March 31, 2015,
was approximately $300.1 million, an increase from $296.2 million
at December 31, 2014. The Company's reported debt balance at March
31, 2015, included approximately $295.6 million of 1.75%
convertible debentures (net of unamortized discount of
approximately $101.1 million), $2.2 million of 1.875% convertible
debentures and approximately $2.3 million for a capital lease and
financing for a small installment land purchase. The increase in
the debt balance is attributable to the accretion of the discount
on the Company's outstanding 1.75% convertible debentures.
* These are non-GAAP financial measures. For a full description
and reconciliation of these and other non-GAAP financial measures
to GAAP financial measures, see Reconciliation of Non-GAAP
Financial Measures to Consolidated Costs of Revenues below.
2015 First Quarter Results Webcast and Conference Call
Stillwater Mining Company will conduct a conference call to
discuss first quarter 2015 results at 12:00 noon Eastern Daylight
Time on Wednesday, May 6, 2015.
Dial-In Numbers: |
United States: |
(877) 407-8037 |
|
International: |
(201) 689-8037 |
A simultaneous webcast and presentation to accompany the
conference call will be available through the Investor Relations
section of the Company's website at www.stillwatermining.com.
A telephone replay of the call will be available for one week
following the event. The replay dial-in numbers are (877) 660-6853
(U.S.) and (201) 612-7415 (International), access code 13607510. In
addition, the call transcript will be archived in the Investor
Relations section of the Company's website.
About Stillwater Mining Company
Stillwater Mining Company is the only U.S. miner of platinum
group metals (PGMs) and the largest primary producer of PGMs
outside of South Africa and the Russian Federation. PGMs are rare
precious metals used in a wide variety of applications, including
automobile catalysts, fuel cells, hydrogen purification,
electronics, jewelry, dentistry, medicine and coinage. The Company
is engaged in the development, extraction and processing of PGMs
from a geological formation in south-central Montana known as the
J-M Reef. The J-M Reef is the only known significant source of PGMs
in the U.S. and the highest-grade PGM resource known in the world.
The Company also recycles PGMs from spent catalytic converters and
other industrial sources. The Company owns the Marathon PGM-copper
deposit in Ontario, Canada, and the Altar porphyry copper-gold
deposit located in the San Juan province of Argentina. The
Company's shares are traded on the New York Stock Exchange under
the symbol SWC. Information about the Company can be found at its
website: www.stillwatermining.com.
Cautionary Note Concerning Forward-Looking
Statements
Some statements contained in this press release are
forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended and Section 21E of
the Securities Exchange Act of 1934, as amended, and, therefore,
involve uncertainties or risks that could cause actual results to
differ materially from management's expectations. These statements
may contain words such as "believes," "anticipates," "plans,"
"expects," "intends," "estimates," "predicts," "should," "will,"
"may" or similar expressions. Such statements also include, but are
not limited to, comments regarding growing profitability;
controlling costs; improving the efficiency of our operations;
strengthening our financial and operating performance; managing our
business through volatile metal prices; estimated 2015 production,
cash costs per mined ounce, AISC, general and administrative costs,
exploration expense, and capital expenditures; and the usefulness
of non-GAAP financial measures. The forward-looking statements in
this release are based on assumptions and analyses made by
Management in light of experience and perception of historical
trends, current conditions, expected future developments, and other
factors that are deemed appropriate. These statements are not
guarantees of the Company's future performance and are subject to
risks, uncertainties and other important factors that could cause
its actual performance or achievements to differ materially from
those expressed or implied by these forward-looking statements.
Additional information regarding factors that could cause results
to differ materially from management's expectations is found in the
section entitled "Risk Factors" in the Company's Annual Report on
Form 10-K. The Company intends that the forward-looking statements
contained herein be subject to the above-mentioned statutory safe
harbors. Investors are cautioned not to rely on forward-looking
statements. The forward-looking statements herein speak only as of
the date of this release. The Company disclaims any obligation to
update forward-looking statements.
|
|
|
Stillwater Mining
Company |
Consolidated Statements
of Comprehensive Income |
(Unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands, except per share
data) |
2015 |
2014 |
REVENUES |
|
|
Mine Production |
$ 125,738 |
$ 125,729 |
PGM Recycling |
74,682 |
93,535 |
Other |
100 |
235 |
Total revenues |
200,520 |
219,499 |
COSTS AND EXPENSES |
|
|
Costs of metals sold |
|
|
Mine Production |
80,041 |
77,992 |
PGM Recycling |
72,705 |
90,706 |
Other |
— |
79 |
Total costs of metals sold
(excludes depletion, depreciation and amortization) |
152,746 |
168,777 |
Depletion, depreciation and
amortization |
|
|
Mine Production |
16,869 |
14,910 |
PGM Recycling |
252 |
241 |
Total depletion, depreciation
and amortization |
17,121 |
15,151 |
Total costs of revenues |
169,867 |
183,928 |
Loss (gain) on disposal of
property, plant and equipment |
3 |
(238) |
Loss on long-term
investments |
55 |
— |
Exploration |
1,080 |
1,046 |
General and administrative |
8,345 |
9,786 |
Total costs and expenses |
179,350 |
194,522 |
OPERATING INCOME |
21,170 |
24,977 |
OTHER INCOME (EXPENSE) |
|
|
Other |
884 |
33 |
Interest income |
703 |
825 |
Interest expense |
(5,304) |
(5,850) |
Foreign currency transaction
(loss) gain, net |
(608) |
4,179 |
INCOME BEFORE INCOME TAX BENEFIT
(PROVISION) |
16,845 |
24,164 |
Income tax benefit
(provision) |
6,043 |
(5,125) |
NET INCOME |
$ 22,888 |
$ 19,039 |
Net loss attributable to noncontrolling
interest |
(115) |
(533) |
NET INCOME ATTRIBUTABLE TO COMMON
STOCKHOLDERS |
$ 23,003 |
$ 19,572 |
Other comprehensive income, net
of tax |
|
|
Net unrealized gains (losses)
on investments available-for-sale |
136 |
(37) |
COMPREHENSIVE INCOME ATTRIBUTABLE TO
COMMON STOCKHOLDERS |
$ 23,139 |
$ 19,535 |
Comprehensive loss attributable to
noncontrolling interest |
(115) |
(533) |
TOTAL COMPREHENSIVE
INCOME |
$ 23,024 |
$ 19,002 |
Weighted average common shares
outstanding |
|
|
Basic |
120,521 |
119,608 |
Diluted |
156,807 |
155,754 |
Basic earnings per share attributable
to common stockholders |
$ 0.19 |
$ 0.16 |
Diluted earnings per share
attributable to common stockholders |
$ 0.17 |
$ 0.15 |
|
|
|
|
|
|
Stillwater Mining
Company |
Consolidated Balance
Sheets |
(Unaudited) |
|
|
|
|
March 31, |
December 31, |
(In thousands, except per share
data) |
2015 |
2014 |
ASSETS |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 262,608 |
$ 280,286 |
Investments, at fair market value |
278,565 |
251,254 |
Inventories |
123,372 |
130,307 |
Trade receivables |
1,152 |
1,277 |
Deferred income taxes |
17,800 |
21,055 |
Prepaids |
1,363 |
2,546 |
Other current assets |
15,123 |
14,671 |
Total current assets |
699,983 |
701,396 |
Mineral properties |
159,252 |
159,252 |
Mine development, net |
422,551 |
409,754 |
Property, plant and equipment, net |
115,957 |
118,881 |
Deferred debt issuance costs |
5,729 |
6,032 |
Other noncurrent assets |
5,571 |
4,012 |
Total assets |
$ 1,409,043 |
$ 1,399,327 |
LIABILITIES AND EQUITY |
|
|
Current liabilities |
|
|
Accounts payable |
$ 22,535 |
$ 26,806 |
Accrued compensation and benefits |
27,821 |
29,973 |
Property, production and franchise taxes
payable |
13,787 |
15,828 |
Current portion of long-term debt and capital
lease obligations |
2,172 |
2,144 |
Other current liabilities |
8,561 |
7,288 |
Total current liabilities |
74,876 |
82,039 |
Long-term debt and capital lease
obligations |
297,933 |
294,023 |
Deferred income taxes |
52,798 |
68,896 |
Accrued workers compensation |
5,914 |
6,060 |
Asset retirement obligation |
9,292 |
9,401 |
Other noncurrent liabilities |
10,035 |
7,200 |
Total liabilities |
450,848 |
467,619 |
EQUITY |
|
|
Stockholders' equity |
|
|
Preferred stock, $0.01 par value, 1,000,000
shares authorized; none issued |
— |
— |
Common stock, $0.01 par value, 200,000,000
shares authorized; 120,619,315 and 120,381,746 shares issued and
outstanding |
1,206 |
1,204 |
Paid-in capital |
1,094,607 |
1,091,146 |
Accumulated deficit |
(156,136) |
(179,139) |
Accumulated other comprehensive income |
153 |
17 |
Total stockholders' equity |
939,830 |
913,228 |
Noncontrolling interest |
18,365 |
18,480 |
Total equity |
958,195 |
931,708 |
Total liabilities and
equity |
$ 1,409,043 |
$ 1,399,327 |
|
|
|
|
|
|
Stillwater Mining
Company |
Consolidated Statements
of Cash Flows |
(Unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands) |
2015 |
2014 |
CASH FLOWS FROM OPERATING
ACTIVITIES |
|
|
Net income |
$ 22,888 |
$ 19,039 |
Adjustments to reconcile net income to net
cash provided by operating activities: |
|
|
Depletion, depreciation and
amortization |
17,121 |
15,151 |
Loss (gain) on disposal of
property, plant and equipment |
3 |
(238) |
Loss on long-term
investments |
55 |
— |
Amortization/accretion of
investment premium/discount |
420 |
574 |
Deferred taxes |
(12,409) |
(2,131) |
Foreign currency transaction
loss (gain), net |
608 |
(4,179) |
Accretion of asset retirement
obligation |
191 |
181 |
Amortization of deferred debt
issuance costs |
303 |
364 |
Accretion of convertible
debenture debt discount |
4,525 |
4,170 |
Share based compensation and
other benefits |
3,438 |
3,180 |
Non-cash capitalized
interest |
(866) |
(679) |
Changes in operating assets and
liabilities: |
|
|
Inventories |
5,997 |
(6,133) |
Trade receivables |
125 |
(19,883) |
Prepaids |
1,183 |
2,039 |
Accounts payable |
(2,043) |
(7,579) |
Accrued compensation and
benefits |
(2,152) |
(1,164) |
Property, production and
franchise taxes payable |
794 |
1,070 |
Income taxes payable |
— |
1,683 |
Accrued workers
compensation |
(146) |
(33) |
Other operating assets |
(1,879) |
(4,234) |
Other operating
liabilities |
156 |
3,567 |
NET CASH PROVIDED BY OPERATING
ACTIVITIES |
38,312 |
4,765 |
CASH FLOWS FROM INVESTING
ACTIVITIES |
|
|
Capital expenditures |
(27,902) |
(26,133) |
Proceeds from disposal of
property, plant and equipment |
— |
259 |
Purchases of investments |
(57,371) |
(76,352) |
Proceeds from maturities of
investments |
29,839 |
35,419 |
NET CASH USED IN INVESTING
ACTIVITIES |
(55,434) |
(66,807) |
CASH FLOWS FROM FINANCING
ACTIVITIES |
|
|
Payments on debt and capital
lease obligations |
(584) |
(557) |
Proceeds from issuance of
common stock |
28 |
536 |
NET CASH USED IN FINANCING
ACTIVITIES |
(556) |
(21) |
CASH AND CASH
EQUIVALENTS |
|
|
Net decrease |
(17,678) |
(62,063) |
Balance at beginning of
period |
280,286 |
286,687 |
BALANCE AT END OF
PERIOD |
$ 262,608 |
$ 224,624 |
|
|
|
|
|
|
Stillwater Mining
Company |
|
|
Key Operating Factors |
|
|
(Unaudited) |
|
|
|
|
|
|
Three
Months Ended |
|
March
31, |
(In thousands, except where
noted) |
2015 |
2014 |
OPERATING AND COST DATA FOR MINE
PRODUCTION |
|
|
Consolidated: |
|
|
Ounces produced |
|
|
Palladium |
103 |
101 |
Platinum |
30 |
30 |
Total |
133 |
131 |
Tons milled |
308 |
277 |
Mill head grade (ounce per ton) |
0.46 |
0.50 |
Sub-grade tons milled (1) |
28 |
18 |
Sub-grade tons mill head grade (ounce per
ton) |
0.16 |
0.19 |
Total tons milled(1) |
336 |
295 |
Combined mill head grade (ounce per ton) |
0.44 |
0.48 |
Total mill recovery (%) |
92 |
92 |
Total mine concentrate shipped (tons)
(3) |
8,456 |
7,301 |
Platinum grade in concentrate (ounce per ton)
(3) |
3.74 |
4.70 |
Palladium grade in concentrate (ounce per
ton) (3) |
12.58 |
14.93 |
Total cash costs per ounce - net of credits
(Non-GAAP) (2) |
$ 537 |
$ 568 |
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) |
$ 213 |
$ 251 |
Stillwater Mine: |
|
|
Ounces produced |
|
|
Palladium |
64 |
69 |
Platinum |
19 |
21 |
Total |
83 |
90 |
Tons milled |
172 |
170 |
Mill head grade (ounce per ton) |
0.51 |
0.56 |
Sub-grade tons milled (1) |
18 |
8 |
Sub-grade tons mill head grade (ounce per
ton) |
0.19 |
0.28 |
Total tons milled (1) |
190 |
178 |
Combined mill head grade (ounce per ton) |
0.48 |
0.55 |
Total mill recovery (%) |
93 |
93 |
Total mine concentrate shipped (tons)
(3) |
4,650 |
4,395 |
Platinum grade in concentrate (ounce per ton)
(3) |
4.44 |
5.56 |
Palladium grade in concentrate (ounce per
ton) (3) |
14.48 |
17.19 |
Total cash costs per ounce - net of credits
(Non-GAAP) (2) |
$ 531 |
$ 546 |
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) |
$ 234 |
$ 275 |
|
|
|
|
|
|
Stillwater Mining
Company |
Key Operating Factors
(Continued) |
(Unaudited) |
|
|
|
|
Three
Months Ended |
|
March
31, |
(In thousands, except where
noted) |
2015 |
2014 |
OPERATING AND COST DATA FOR MINE
PRODUCTION (Continued) |
|
|
East Boulder Mine: |
|
|
Ounces produced |
|
|
Palladium |
39 |
32 |
Platinum |
11 |
9 |
Total |
50 |
41 |
Tons milled |
136 |
107 |
Mill head grade (ounce per ton) |
0.40 |
0.41 |
Sub-grade tons milled (1) |
10 |
10 |
Sub-grade tons mill head grade (ounce per
ton) |
0.10 |
0.11 |
Total tons milled (1) |
146 |
117 |
Combined mill head grade (ounce per ton) |
0.38 |
0.39 |
Total mill recovery (%) |
91 |
90 |
Total mine concentrate shipped (tons)
(3) |
3,806 |
2,906 |
Platinum grade in concentrate (ounce per ton)
(3) |
2.89 |
3.41 |
Palladium grade in concentrate (ounce per
ton) (3) |
10.25 |
11.52 |
Total cash costs per ounce - net of credits
(Non-GAAP) (2) |
$ 547 |
$ 614 |
Total cash costs per ton milled - net of
credits (Non-GAAP) (2) |
$ 186 |
$ 215 |
|
|
|
(1) Sub-grade tons milled
includes reef waste material only. Total tons milled includes ore
tons and sub-grade tons only. See "Proven and Probable Ore Reserves
– Discussion" in the Company's forthcoming 2015 Annual Report on
Form 10-Q for further information. |
(2) Total cash costs
include total operating costs plus royalties, insurance and taxes
other than income taxes. Income taxes, corporate general and
administrative expenses, asset impairment write-downs, gain or loss
on disposal of property, plant and equipment, reorganization costs
and interest income and expense are not included in total cash
costs. Cash costs per ton and cash costs per ounce, are non-GAAP
financial measure that management uses to monitor and evaluate the
efficiency of its mining operations. These measures of cost are not
defined under U.S. Generally Accepted Accounting Principles (GAAP).
See "Reconciliation of Non-GAAP Financial Measures to Consolidated
Costs of Revenues" and the accompanying discussion for additional
detail. |
(3) The concentrate tonnage
and grade values are inclusive of periodic re-processing of smelter
slag and internal furnace brick PGM bearing materials. |
|
|
|
|
|
|
Stillwater Mining
Company |
Key Operating Factors
(Continued) |
(Unaudited) |
|
|
|
|
Three
Months Ended |
|
March
31, |
(In thousands, except for
average prices) |
2015 |
2014 |
SALES AND PRICE DATA |
|
|
Ounces sold |
|
|
Mine Production: |
|
|
Palladium (oz.) |
107 |
100 |
Platinum (oz.) |
30 |
31 |
Total |
137 |
131 |
PGM Recycling: (1) |
|
|
Palladium (oz.) |
44 |
54 |
Platinum (oz.) |
25 |
32 |
Rhodium (oz.) |
6 |
8 |
Total |
75 |
94 |
By-products from Mine Production: (2) |
|
|
Rhodium (oz.) |
1 |
1 |
Gold (oz.) |
3 |
3 |
Silver (oz.) |
1 |
2 |
Copper (lb.) |
260 |
176 |
Nickel (lb.) |
398 |
365 |
Average realized price per ounce
(3) |
|
|
Mine Production: |
|
|
Palladium ($/oz.) |
$ 784 |
$ 743 |
Platinum ($/oz.) |
$ 1,189 |
$ 1,431 |
Combined ($/oz.)(4) |
$ 871 |
$ 907 |
PGM Recycling: (1) |
|
|
Palladium ($/oz.) |
$ 797 |
$ 729 |
Platinum ($/oz.) |
$ 1,250 |
$ 1,410 |
Rhodium ($/oz.) |
$ 1,220 |
$ 857 |
Combined ($/oz.)(4) |
$ 981 |
$ 980 |
By-products from Mine Production: (2) |
|
|
Rhodium ($/oz.) |
$ 1,166 |
$ 1,060 |
Gold ($/oz.) |
$ 1,222 |
$ 1,295 |
Silver ($/oz.) |
$ 17 |
$ 21 |
Copper ($/lb.) |
$ 2.46 |
$ 3.05 |
Nickel ($/lb.) |
$ 4.97 |
$ 5.81 |
Average market price per ounce
(3) |
|
|
Palladium ($/oz.) |
$ 786 |
$ 745 |
Platinum ($/oz.) |
$ 1,192 |
$ 1,429 |
Combined ($/oz.)(4) |
$ 873 |
$ 908 |
|
|
|
(1) Ounces sold and average
realized price per ounce from PGM Recycling relate to ounces
produced from processing of catalyst materials. |
(2) By-product metals sold
reflect contained metal produced from mined ore alongside the
Company's primary production of palladium and platinum. Realized
prices reflect net values (discounted due to product form and
transportation and marketing charges) per unit received. |
(3) The Company's average
realized price represents revenues, which include the effect of
hedging gains and losses realized on commodity instruments and
agreement discounts, divided by ounces sold. The average market
price represents the average price in the London market for the
actual months of the period. |
(4) The Company calculates
the combined average realized and a combined average market price
of palladium and platinum using the same ratio as the rate of
ounces of each respective metal that are produced from the base
metal refinery. |
|
|
|
Reconciliation of Non-GAAP Financial Measures to
Consolidated Costs of Revenues
The Company utilizes certain non-GAAP financial measures as
indicators in assessing the performance of its mining and
processing operations during any period. Because of the processing
time required to complete the extraction of finished PGM products,
there are typically lags of one to three months between ore
production and sale of the finished product. Sales in any period
include some portion of material mined and processed from prior
periods as the revenue recognition process is completed.
Consequently, while costs of revenues (a GAAP financial measure
included in the Company's Consolidated Statements of Comprehensive
Income) appropriately reflects the expense associated with the
materials sold in any period, the Company has developed certain
non-GAAP financial measures to assess the costs associated with its
producing and processing activities in a particular period and to
compare those costs between periods.
While the Company believes that these non-GAAP financial
measures may also be of value to outside readers, both as general
indicators of the Company's mining efficiency from period to period
and as insight into how the Company internally measures its
operating performance, these non-GAAP financial measures are not
standardized across the mining industry and in most cases will not
be comparable to similar measures that may be provided by other
companies. These non-GAAP financial measures are only useful as
indicators of relative operational performance in any period, and
because they do not take into account the inventory timing
differences that are included in costs of revenues, they cannot
meaningfully be used to develop measures of earnings or
profitability. A reconciliation of these measures to costs of
revenues, the most directly comparable GAAP financial measure, for
each period shown is provided as part of the following tables, and
a description of each non-GAAP financial measure is provided
below.
Total Consolidated Costs of Revenues: For the
Company as a whole, this measure is equal to total costs of
revenues, as reported in the Consolidated Statements of
Comprehensive Income. For the Stillwater Mine, the East Boulder
Mine, and PGM Recycling and Other, the Company segregates the
expenses within total costs of revenues that are directly
associated with each of these activities and then allocates the
remaining facility costs included in total cost of revenues in
proportion to the monthly volumes from each activity. The resulting
total costs of revenues measures for the Stillwater Mine, the East
Boulder Mine and PGM Recycling and Other are equal in the
aggregate, to total consolidated costs of revenues as reported in
the Company's Consolidated Statements of Comprehensive Income.
Total Cash Costs (Non-GAAP): This non-GAAP
financial measure is calculated as total costs of revenues (for
each mine or combined) adjusted to exclude gains or losses on asset
dispositions, costs and profit from recycling activities, revenues
from the sale of mine by-products, depreciation and amortization
and asset retirement costs, and timing differences resulting from
changes in product inventories. The Company uses this measure as a
comparative indication of the cash costs related to mine production
and processing operations in any period. It is a measure of
extraction efficiency.
When divided by the total tons milled in the respective period,
Total Cash Costs per Ton Milled (Non-GAAP),
measured for each mine or combined, provides an indication of the
level of cash costs incurred per ton milled in that period. Because
of variability of ore grade in the Company's mining operations,
mine production efficiency underground is frequently measured
against ore tons produced rather than contained PGM ounces. Because
ore tons are first weighed as they are fed into the mill, mill feed
is the first point at which mine production tons are measured
precisely. Consequently, Total Cash Costs per Ton Milled (Non-GAAP)
is a general measure of production efficiency, and is affected both
by the level of Total Cash Costs (Non-GAAP) and by the volume of
tons produced and fed to the mill.
When divided by the total recoverable PGM ounces from production
in the respective period, Total Cash Costs per Ounce
(Non-GAAP), measured for each mine or combined, provides
an indication of the level of cash costs incurred per PGM ounce
produced in that period. Recoverable PGM ounces from production are
an indication of the amount of PGM product extracted through mining
in any period. Because ultimately extracting PGM material is the
objective of mining, the cash cost per ounce of extracting and
processing PGM ounces in a period is a useful measure for comparing
extraction efficiency between periods and between the Company's
mines. Consequently, Total Cash Costs per Ounce (Non-GAAP) in any
period is a general measure of extraction efficiency, and is
affected by the level of Total Cash Costs (Non-GAAP), by the grade
of the ore produced and by the volume of ore produced in the
period.
|
|
|
Stillwater Mining
Company |
Reconciliation of
Non-GAAP Financial Measures to Consolidated Costs
of Revenues |
(Unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands, except per ounce
and per ton data) |
2015 |
2014 |
Consolidated: |
|
|
Total cash costs before by-product and
recycling credits (Non-GAAP) |
$ 80,433 |
$ 84,051 |
By-product credit |
(6,745) |
(6,681) |
Recycling income credit |
(2,127) |
(3,168) |
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 71,561 |
$ 74,202 |
|
|
|
Divided by platinum/palladium ounces
produced |
133 |
131 |
|
|
|
Total cash costs before by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 604 |
$ 643 |
By-product credit per ounce Pt/Pd
produced |
(51) |
(51) |
Recycling income credit per ounce Pt/Pd
produced |
(16) |
(24) |
|
|
|
Total cash costs net of by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 537 |
$ 568 |
|
|
|
Divided by ore tons milled |
336 |
295 |
|
|
|
Total cash costs before by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 239 |
$ 285 |
By-product credit per ore ton milled |
(20) |
(23) |
Recycling income credit per ore ton
milled |
(6) |
(11) |
Total cash costs net of by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 213 |
$ 251 |
|
|
|
Reconciliation to consolidated costs
of revenues: |
|
|
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 71,561 |
$ 74,202 |
Asset retirement costs |
191 |
181 |
Depletion, depreciation and amortization |
16,869 |
14,910 |
Depletion, depreciation and amortization (in
inventory) |
(937) |
553 |
Change in product inventories |
354 |
(6,714) |
Cost of PGM Recycling |
72,705 |
90,706 |
PGM Recycling depreciation |
252 |
241 |
By-product credit |
6,745 |
6,681 |
Profit from PGM Recycling (before gain/loss
on asset disposals) |
2,127 |
3,168 |
Total consolidated cost of revenues |
$ 169,867 |
$ 183,928 |
|
|
|
|
|
|
Stillwater Mining
Company |
Reconciliation of
Non-GAAP Financial Measures to Consolidated Costs of Revenues
(Continued) |
(Unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands, except per ounce
and per ton data) |
2015 |
2014 |
Stillwater Mine: |
|
|
Total cash costs before by-product and
recycling credits (Non-GAAP) |
$ 49,534 |
$ 55,228 |
Less: By-product credit |
(3,805) |
(4,016) |
Less: Recycling income credit |
(1,335) |
(2,171) |
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 44,394 |
$ 49,041 |
|
|
|
Divided by platinum/palladium ounces
produced |
84 |
90 |
|
|
|
Total cash costs before by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 592 |
$ 615 |
Less: By-product credit per ounce Pt/Pd
produced |
(45) |
(45) |
Less: Recycling income credit per ounce Pt/Pd
produced |
(16) |
(24) |
|
|
|
Total cash costs net of by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 531 |
$ 546 |
|
|
|
Divided by ore tons milled |
190 |
178 |
|
|
|
Total cash costs before by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 261 |
$ 310 |
Less: By-product credit per ore ton
milled |
(20) |
(23) |
Less: Recycling income credit per ore ton
milled |
(7) |
(12) |
Total cash costs net of by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 234 |
$ 275 |
|
|
|
Reconciliation to costs of
revenues: |
|
|
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 44,394 |
$ 49,041 |
Asset retirement costs |
183 |
169 |
Depletion, depreciation and amortization |
12,095 |
11,385 |
Depletion, depreciation and amortization (in
inventory) |
(716) |
372 |
Change in product inventories |
1,259 |
(4,050) |
By-product credit |
3,805 |
4,016 |
Profit from PGM Recycling (before gain/loss
on asset disposals) |
1,335 |
2,171 |
Total costs of revenues |
$ 62,355 |
$ 63,104 |
|
|
|
|
|
|
Stillwater Mining
Company |
Reconciliation of
Non-GAAP Financial Measures to Consolidated Costs of Revenues
(Continued) |
(Unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands, except per ounce
and per ton data) |
2015 |
2014 |
East Boulder Mine |
|
|
Total cash costs before by-product and
recycling credits (Non-GAAP) |
$ 30,899 |
$ 28,823 |
Less: By-product credit |
(2,940) |
(2,665) |
Less: Recycling income credit |
(792) |
(997) |
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 27,167 |
$ 25,161 |
|
|
|
Divided by platinum/palladium ounces
produced |
50 |
41 |
|
|
|
Total cash costs before by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 622 |
$ 703 |
Less: By-product credit per ounce Pt/Pd
produced |
(59) |
(65) |
Less: Recycling income credit per ounce Pt/Pd
produced |
(16) |
(24) |
|
|
|
Total cash costs net of by-product and
recycling credits per ounce Pt/Pd produced (Non-GAAP) |
$ 547 |
$ 614 |
|
|
|
Divided by ore tons milled |
146 |
117 |
|
|
|
Total cash costs before by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 211 |
$ 247 |
Less: By-product credit per ore ton
milled |
(20) |
(23) |
Less: Recycling income credit per ore ton
milled |
(5) |
(9) |
Total cash costs net of by-product and
recycling credits per ore ton milled (Non-GAAP) |
$ 186 |
$ 215 |
|
|
|
Reconciliation to costs of
revenues: |
|
|
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 27,167 |
$ 25,161 |
Asset retirement costs |
8 |
12 |
Depletion, depreciation and amortization |
4,774 |
3,525 |
Depletion, depreciation and amortization (in
inventory) |
(221) |
181 |
Change in product inventories |
(905) |
(2,743) |
By-product credit |
2,940 |
2,665 |
Profit from PGM Recycling (before gain/loss
on asset disposals) |
792 |
997 |
Total costs of revenues |
$ 34,555 |
$ 29,798 |
|
|
|
PGM Recycling and Other:
(1) |
|
|
Cost of open market acquisitions |
$ — |
$ 79 |
Cost of PGM Recycling |
72,705 |
90,706 |
PGM Recycling depreciation |
252 |
241 |
Total costs of revenues |
$ 72,957 |
$ 91,026 |
|
|
|
(1) PGM Recycling and Other
include PGM recycling and metal acquired periodically in the open
market and simultaneously resold to third parties. |
|
|
|
|
|
|
Stillwater Mining
Company |
All-In Sustaining Costs
(a Non-GAAP Financial Measure) |
|
|
|
(Unaudited) |
|
|
|
All-In Sustaining Costs
(Non-GAAP): This non-GAAP financial measure is used as an
indicator from period to period of the level of total cash required
by the Company to maintain and operate the existing mines,
including corporate administrative costs and replacement capital.
The measure is calculated beginning with total cash costs (another
non-GAAP financial measure, described above), and adding to it the
recycling income credit, domestic corporate overhead and marketing
costs (excluding any depreciation, research and development, and
reorganization costs included in corporate overhead costs) and that
portion of total capital expenditures associated with sustaining
the current level of mining operations. (Capital expenditures for
Blitz, Graham Creek and certain other one-time projects are not
included in the calculation.) |
|
|
|
When divided by the total
recoverable PGM ounces in the respective period, All-In
Sustaining Costs per Mined Ounce (Non-GAAP) provides an
indication of the level of total cash required to maintain and
operate the mines per PGM ounce produced in the period. Recoverable
PGM ounces from production are an indication of the amount of PGM
product extracted through mining in any period. Because the
objective of PGM mining activity is to extract PGM material, the
all-in cash costs per ounce to produce PGM material, administer the
business and sustain the operating capacity of the mines is a
useful measure for comparing overall extraction efficiency between
periods. This measure is affected by the total level of spending in
the period and by the grade and volume of ore produced. |
|
|
|
|
Three Months
Ended |
|
March
31, |
(In thousands, except
$/oz.) |
2015 |
2014 |
All-In Sustaining Costs |
|
|
Total cash costs net of by-product and
recycling credits (Non-GAAP) |
$ 71,561 |
$ 74,202 |
Recycling income credit |
2,127 |
3,168 |
|
$ 73,688 |
$ 77,370 |
|
|
|
Consolidated Corporate General &
Administrative costs |
$ 8,345 |
$ 9,786 |
Corporate depreciation and R&D included
in Consolidated Corporate General & Administrative costs
(1) |
(132) |
(143) |
General & Administrative Costs - Foreign
Subsidiaries |
(417) |
(1,856) |
|
$ 7,796 |
$ 7,787 |
|
|
|
Total capitalized costs |
$ 28,375 |
$ 24,674 |
Capital associated with expansion |
(8,121) |
(6,789) |
Total Capital incurred to sustain existing
operations |
$ 20,254 |
$ 17,885 |
|
|
|
All-In Sustaining Costs (Non-GAAP) |
$ 101,738 |
$ 103,042 |
|
|
|
Mined ounces produced |
133.3 |
130.7 |
|
|
|
All-In Sustaining Costs per Mined Ounce
($/oz.) (Non-GAAP) |
$ 763 |
$ 788 |
|
|
|
(1) Consolidated Corporate
General & Administrative Costs includes Marketing and Research
and Development (R&D) costs. The Marketing and R&D costs in
prior years were separate line items on the Company's Consolidated
Statements of Comprehensive Income. |
|
Prior year numbers have been
restated to conform to current year presentation. |
|
|
|
CONTACT: INVESTOR CONTACT:
Mike Beckstead
(406) 373-8971
investor-relations@stillwatermining.com
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