Coeur Reports Fourth Quarter and Full-Year 2019 Results

Provides Full-Year 2020 Production and Cost Guidance

CHICAGO - Coeur Mining, Inc. (“Coeur” or the “Company”) (NYSE: CDE) today reported fourth quarter 2019 financial results, including revenue of $195.0 million and cash flow from operating activities of $39.3 million. Including non-cash write downs of $277.7 million taken in the quarter, the Company reported GAAP net loss from continuing operations of $270.9 million, or $1.13 per share. On an adjusted basis1, the Company reported EBITDA of $59.8 million and net loss from continuing operations of $3.3 million, or $0.01 per share.



For the full year, Coeur reported revenue of $711.5 million and cash flow from operating activities of $91.9 million. Including non-cash write downs totaling $320.0 million, the Company reported GAAP net loss from continuing operations of $346.9 million, or $1.59 per share. On an adjusted basis1, the Company reported EBITDA of $173.9 million and net loss from continuing operations of $54.6 million, or $0.25 per share.


Key Highlights

- Solid improvement in annual financial results - Revenue, operating cash flow and adjusted EBITDA1 increased 14%, 357% and 11%, respectively, in 2019. The year-over-year improvement in financial results reflects solid performance from the Company’s primary gold operations as well as higher precious metals prices in 2019

- Strong cost performance from primary gold operations - Full-year adjusted costs applicable to sales (“CAS”)1 at Palmarejo, Kensington and Wharf were below or within their guidance ranges for 2019, leading to strong free cash flow1 at each of these primary gold operations. During 2019, gold sales represented 69% of the Company’s total revenue

- Third consecutive quarter of increasing, positive free cash flow1 - Coeur generated $18.4 million of free cash flow1 during the fourth quarter, representing a 63% increase compared to the prior period and a $36.1 million improvement compared to the fourth quarter of 2018. This third consecutive quarter of increasing, positive free cash flow1 was primarily driven by strong performance from the Company’s Palmarejo, Kensington and Wharf operations

- Positive results from high-pressure grinding roll (“HPGR”) unit at Rochester - 60-day silver recovery rates from HPGR-crushed ore are in-line with prior test work and are significantly better than recoveries from traditionally-crushed material. Permitting and planning for Plan of Operations Amendment 11 (“POA 11”) expansion advancing on-schedule

- $250.8 million impairment, and temporarily suspending mining and processing activities at Silvertip - Reduction in carrying value to $150.0 million and temporary suspension of mining and processing activities driven by further deterioration in zinc and lead market conditions as well as processing facility-related challenges. The Company plans to (i) double its exploration investment in 2020 to potentially further expand the resource and extend the mine life, and (ii) pursue a mill expansion to improve the asset’s cost structure and its ability to deliver sustainable cash flow

- Success from 2019 investment in exploration delivered resource growth - The Company focused its exploration efforts primarily on resource expansion drilling in 2019. Measured and indicated resources increased across all metals, and inferred gold, zinc and lead resources were higher year-over-year. Proven and probable silver reserves also increased, while zinc and lead reserves were consistent year-over-year

- Over $160.0 million reduction in total debt2 achieved during 2019 - The Company ended the year with $295.5 million in total debt2, compared to $458.8 million at the end of 2018. This 36% reduction reflects the results of Coeur’s deleveraging initiatives and improved financial performance during 2019


“Higher precious metals prices and strong performance from our primary gold operations drove a 14% increase in revenue, an 11% increase in adjusted EBITDA1, and a four-fold increase in operating cash flow,” said Mitchell J. Krebs, President and Chief Executive Officer. “Our 2019 results reflect our strategy to discover, develop, and operate a balanced portfolio of North American-based precious metals assets. Palmarejo delivered over $65.0 million of free cash flow1 last year while Wharf generated over $37.0 million of free cash flow, bringing its cumulative free cash flow1 to over $170.0 million since we acquired the operation in 2015 for $99.5 million. We were also pleased to see Kensington deliver record free cash flow1 after a multi-year effort to discover and develop higher-grade mineralization.”

“Despite a weaker than anticipated fourth quarter due to lower crushing rates, our Rochester open-pit, silver-gold mine in Nevada remains our top growth opportunity. We began processing ore through a new crushing circuit during the second half of the year utilizing HPGR technology. Early indications suggest that HPGR is having its intended impact by increasing and accelerating silver recovery rates. HPGR forms the basis of a larger expansion during the next two years that is expected to position Rochester as a long-life, strong cash flow generator for the Company.”

Mr. Krebs continued, “The decision to temporarily suspend operating activities at Silvertip, which represented approximately 6% of the Company’s 2019 revenue, was driven by our goal of maximizing the long-term value of the operation. While we have been successful in executing key projects and improving mill availability, the further deterioration in the zinc and lead markets - particularly for spot concentrate treatment charges - represents significant headwinds to our ability to generate positive cash flow. While mining and processing activities are paused, we plan to more than double our investment in drilling to further expand Silvertip’s high-grade deposit and extend its mine life. During 2019, we were able to grow Silvertip’s inferred resources by over 70% and its measured and indicated resources by nearly 40%. In addition, we have commenced a pre-feasibility study to evaluate a mill expansion, which we believe will significantly enhance Silvertip’s economics.”

“Looking ahead, our top priorities for 2020 are to (i) advance and execute our strategy to further expand Rochester, (ii) increase our level of investment in exploration, particularly at our most prospective sites, (iii) evaluate and pursue a successful repositioning of Silvertip, (iv) deliver consistent results from our operations, leading to positive free cash flow1 and lower overall costs, and (v) continue to enhance our leading environmental, social and governance profile,” concluded Mr. Krebs.


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