Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 23, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-34857 | |
Entity Registrant Name | Gold Resource Corporation | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 84-1473173 | |
Entity Address, Address Line One | 7900 E. Union Ave | |
Entity Address, Address Line Two | Suite 320 | |
Entity Address, City or Town | Denver, | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80237 | |
City Area Code | 303 | |
Local Phone Number | 320-7708 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | GORO | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 88,468,542 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001160791 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED INTERIM
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 21,420 | $ 23,675 |
Accounts receivable, net | 5,134 | 5,085 |
Inventories, net | 11,179 | 13,500 |
Prepaid expenses and other current assets | 2,983 | 3,839 |
Total current assets | 40,716 | 46,099 |
Property, plant and mine development, net | 148,997 | 152,563 |
Other non-current assets | 5,488 | 5,509 |
Total assets | 195,201 | 204,171 |
Current liabilities: | ||
Accounts payable | 8,616 | 13,329 |
Mining royalty taxes payable, net | 744 | 3,945 |
Contingent consideration | 2,215 | 2,211 |
Accrued expenses and other current liabilities | 5,058 | 5,197 |
Total current liabilities | 16,633 | 24,682 |
Reclamation and remediation liabilities | 11,669 | 10,366 |
Gold and silver stream agreements liability | 43,740 | 43,466 |
Deferred tax liabilities, net | 7,719 | 9,224 |
Contingent consideration | 2,144 | 2,179 |
Other non-current liabilities | 2,305 | 2,490 |
Total liabilities | 84,210 | 92,407 |
Shareholders' equity: | ||
Common stock - $0.001 par value, 200,000,000 shares authorized: 88,468,542 and 88,398,109 shares outstanding at March 31, 2023 and December 31, 2022, respectively | 89 | 89 |
Additional paid-in capital | 111,286 | 111,024 |
Retained earnings | 6,671 | 7,706 |
Treasury stock at cost, 336,398 shares | (5,884) | (5,884) |
Accumulated other comprehensive loss | (1,171) | (1,171) |
Total shareholders' equity | 110,991 | 111,764 |
Total liabilities and shareholders' equity | $ 195,201 | $ 204,171 |
CONDENSED CONSOLIDATED INTERI_2
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares outstanding | 88,468,542 | 88,398,109 |
Treasury stock, shares | 336,398 | 336,398 |
CONDENSED CONSOLIDATED INTERI_3
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Sales, net | $ 31,228 | $ 45,417 |
Cost of sales: | ||
Production costs | 19,850 | 20,074 |
Depreciation and amortization | 7,254 | 5,958 |
Reclamation and remediation | 195 | 62 |
Total cost of sales | 27,299 | 26,094 |
Mine gross profit | 3,929 | 19,323 |
Costs and expenses: | ||
General and administrative expenses | 1,193 | 1,899 |
Exploration expenses | 1,839 | 2,305 |
Stock-based compensation | 597 | 774 |
Realized and unrealized loss on zinc zero cost collar | 4,137 | |
Other expense, net | 1,469 | 838 |
Total costs and expenses | 5,098 | 9,953 |
(Loss) income before income taxes | (1,169) | 9,370 |
Provision for income taxes | (134) | 5,351 |
Net (loss) income | $ (1,035) | $ 4,019 |
Net (loss) income per common share: | ||
Basic net (loss) income per common share | $ (0.01) | $ 0.05 |
Diluted net (loss) income per common share | $ (0.01) | $ 0.05 |
Weighted average shares outstanding: | ||
Basic | 88,405,935 | 88,338,774 |
Diluted | 88,405,935 | 88,616,868 |
Oaxaca, Mexico | ||
Costs and expenses: | ||
Exploration expenses | $ 1,389 | $ 1,237 |
Michigan, USA | ||
Costs and expenses: | ||
Exploration expenses | $ 450 | $ 1,068 |
CONDENSED CONSOLIDATED INTERI_4
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Shares | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | Total |
Balance at Dec. 31, 2021 | $ 110,153 | $ 17,563 | $ (5,884) | $ (1,171) | $ 120,750 | |
Balance (in shares) at Dec. 31, 2021 | 88,675,172 | |||||
Balance at Dec. 31, 2021 | $ 89 | |||||
Stock-based compensation | 160 | 160 | ||||
Net stock options exercised | (331) | $ (331) | ||||
Net stock options exercised (in shares) | 355,000 | |||||
Dividends declared | (883) | $ (883) | ||||
Net (loss) income | 4,019 | 4,019 | ||||
Balance at Mar. 31, 2022 | 109,982 | 20,699 | (5,884) | (1,171) | 123,715 | |
Balance (in shares) at Mar. 31, 2022 | 88,675,172 | |||||
Balance at Mar. 31, 2022 | $ 89 | |||||
Balance at Dec. 31, 2022 | 111,024 | 7,706 | (5,884) | (1,171) | 111,764 | |
Balance (in shares) at Dec. 31, 2022 | 88,734,507 | |||||
Balance at Dec. 31, 2022 | $ 89 | 89 | ||||
Stock-based compensation | 273 | $ 273 | ||||
Net stock options exercised (in shares) | 0 | |||||
Common stock issued for vested restricted stock units (in shares) | 88,570 | |||||
Surrender of stock for taxes due on vesting | (11) | $ (11) | ||||
Surrender of stock for taxes due on vesting (in shares) | (18,137) | |||||
Net (loss) income | (1,035) | (1,035) | ||||
Balance at Mar. 31, 2023 | $ 111,286 | $ 6,671 | $ (5,884) | $ (1,171) | 110,991 | |
Balance (in shares) at Mar. 31, 2023 | 88,804,940 | |||||
Balance at Mar. 31, 2023 | $ 89 | $ 89 |
CONDENSED CONSOLIDATED INTERI_5
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) | 3 Months Ended |
Mar. 31, 2022 $ / shares | |
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | |
Cash dividends declared per share | $ 0.01 |
CONDENSED CONSOLIDATED INTERI_6
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (1,035) | $ 4,019 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Deferred income tax benefit | (715) | (827) |
Depreciation and amortization, including amortization in reclamation | 7,276 | 6,003 |
Stock-based compensation | 597 | 774 |
Other operating adjustments | 631 | 2,551 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (49) | (2,975) |
Inventories | 1,741 | (2,013) |
Prepaid expenses and other current assets | 1,390 | 1,179 |
Other noncurrent assets | (42) | 340 |
Accounts payable and other accrued liabilities | (4,514) | (920) |
Mining royalty and income taxes payable, net | (4,256) | (3,901) |
Net cash provided by operating activities | 1,024 | 4,230 |
Cash flows from investing activities: | ||
Capital expenditures | (3,136) | (5,949) |
Proceeds from the sale of gold and silver rounds | 533 | |
Net cash used in investing activities | (3,136) | (5,416) |
Cash flows from financing activities: | ||
(Cash settlement of) proceeds from stock options exercise | (246) | |
Dividends paid | (883) | |
Other financing activities | (16) | |
Net cash used in financing activities | (16) | (1,129) |
Effect of exchange rate changes on cash and cash equivalents | (127) | (222) |
Net (decrease) increase in cash and cash equivalents | (2,255) | (2,537) |
Cash and cash equivalents at beginning of period | 23,675 | 33,712 |
Cash and cash equivalents at end of period | $ 21,420 | $ 31,175 |
CONDENSED CONSOLIDATED INTERI_7
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Supplemental Cash Flow Information | ||
Income and mining taxes paid | $ 4,501 | $ 13,857 |
Non-cash investing activities and financing: | ||
Change in capital expenditures in accounts payable | $ (983) | $ (927) |
Basis of Preparation of Financi
Basis of Preparation of Financial Statements | 3 Months Ended |
Mar. 31, 2023 | |
Basis of Preparation of Financial Statements | |
Basis of Preparation of Financial Statements | 1. Basis of Preparation of Financial Statements The Condensed Consolidated Interim Financial Statements (“interim financial statements”) of Gold Resource Corporation and its subsidiaries (collectively, the “Company”) are unaudited and have been prepared in accordance with the rules of the Securities and Exchange Commission (“SEC”) for interim statements. Certain information and footnote disclosures required by United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted as permitted by such rules, although the Company believes that the disclosures included are adequate to make the information presented not misleading. In the opinion of management, all adjustments (including normal recurring adjustments) and disclosures necessary for a fair presentation of these interim financial statements have been included. The results reported in these interim financial statements are not necessarily indicative of the results that may be reported for the entire year. These interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2022 included in the Company’s annual report on Form 10-K. The year-end balance sheet data was derived from the audited financial statements. Unless otherwise noted, there have been no material changes to the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s annual report on Form 10-K. Certain items in the prior period’s consolidated financial statements and notes have been reclassified to conform to the current presentation. In the first quarter of 2022, exploration expenses included both the Don David Gold Mine (“DDGM”) exploration expenses and the Back Forty Project expenses. In 2023, these are presented on separate lines in the Consolidated Statements of Operations to align with the current presentation. These reclassifications had no effect on the reported results of operations. |
Recently Adopted Accounting Sta
Recently Adopted Accounting Standards | 3 Months Ended |
Mar. 31, 2023 | |
Recently Adopted Accounting Standards | |
Recently Adopted Accounting Standards | 2. Recently Adopted Accounting Standards Recent accounting pronouncements issued have been evaluated and do not presently impact our financial statements and supplemental data. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue | |
Revenue | 3. Revenue The Company derives its revenue from the sale of doré and concentrates. The following table presents the Company’s net sales for each period presented, disaggregated by source: For the three months ended March 31, 2023 2022 (in thousands) Doré sales, net Gold $ 1,725 $ 1,244 Silver 69 20 Less: Refining charges (25) (7) Total doré sales, net 1,769 1,257 Concentrate sales Gold 10,622 14,541 Silver 6,573 6,085 Copper 2,994 4,097 Lead 2,965 3,827 Zinc 9,551 16,317 Less: Treatment and refining charges (3,159) (2,741) Total concentrate sales, net 29,546 42,126 Realized gain - embedded derivative, net (1) 634 866 Unrealized (loss) gain - embedded derivative, net (721) 1,168 Total sales, net $ 31,228 $ 45,417 (1) Copper, lead, and zinc are co-products. In the Realized gain - embedded derivative, net, there is $0.4 million gain related to these co-products for the three months ended March 31, 2023. There is $0.5 million gain in the Realized gain - embedded derivative, net, related to the co-products for the three months ended March 31, 2022. |
Inventories, net
Inventories, net | 3 Months Ended |
Mar. 31, 2023 | |
Inventories, net | |
Inventories, net | 4. Inventories, net At March 31, 2023 and December 31, 2022, inventories, net, consisted of the following: As of As of March 31, December 31, 2023 2022 (in thousands) Stockpiles - underground mine $ 171 $ 597 Concentrates 2,035 3,271 Doré, net 382 653 Subtotal - product inventories 2,588 4,521 Materials and supplies (1) 8,591 8,979 Total $ 11,179 $ 13,500 (1) Net of reserve for obsolescence of $0.1 million as of March 31, 2023 and December 31, 2022. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes | |
Income Taxes | 5. Income Taxes The Company recorded an income tax benefit of $0.1 million for the three months ended March 31, 2023. For the three months ended March 31, 2022, the Company recorded an income tax expense of $5.4 million. In accordance with applicable accounting rules, the interim provision for taxes is calculated using the estimated consolidated annual effective tax rate. The consolidated effective tax rate is a function of the combined effective tax rates for the jurisdictions in which the Company operates. Variations in the relative proportions of jurisdictional income could result in fluctuations to the Company’s consolidated effective tax rate. At the federal level, the Company’s income in the U.S. is taxed at 21%, and a 5% withholding tax applies to dividends received from Mexico. The Mexico income is taxed at 37.5% (30% income tax and 7.5% mining tax), and Canada income is taxed at 26.5%, which results in a consolidated effective tax rate above statutory U.S. Federal rates. The U.S. and Canadian jurisdictions do not currently generate taxable income. Mexico Mining Taxation Mining entities in Mexico are subject to two mining duties, in addition to the 30% Mexico corporate income tax: (i) a “special” mining duty of 7.5% of taxable income as defined under Mexican tax law (also referred to as “mining royalty tax”) on extraction activities performed by concession holders, and (ii) the “extraordinary” mining duty of 0.5% on gross revenue from the sale of gold, silver, and platinum. The mining royalty tax is generally applicable to earnings before income tax, depreciation, depletion, amortization, and interest. In calculating the mining royalty tax, there are no Gold Resource Corporation deductions related to depreciable costs from operational fixed assets, but prospecting and exploration expenses are amortized using a 10% rate in a 10 year straight line. Both duties are tax deductible for income tax purposes. As a result, our effective tax rate applicable to the Company’s Mexican operations is higher than Mexico’s statutory rate. The Company periodically transfers funds from its Mexican wholly-owned subsidiary to the U.S. in the form of dividends, which are subject to a 10% Mexico withholding tax, unless otherwise provided per a tax treaty. The current U.S.-Mexico tax treaty limits the dividend withholding tax between these countries to 5%, as long as certain requirements are met. Based on the Company’s understanding that it meets these requirements, the Company pays a 5% withholding tax on dividends paid from Mexico. The impact of the planned annual dividends for 2023 is reflected in the estimated annual effective tax rate. As of March 31, 2023, the Company recorded $0.6 million deferred tax liability related to the 5% withholding tax on funds available for transfer to the U.S. as dividends in the future are no longer deemed to be permanently reinvested in Mexico. If these funds are distributed to the U.S. from Mexico in the future, at that time, they will be subject to the 5% dividend withholding tax payment upon distribution. As of March 31, 2023, the Company believes that it has no liability for uncertain tax positions. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2023 | |
Prepaid Expenses And Other Current Assets | |
Prepaid Expenses and Other Current Assets | 6. Prepaid Expenses and Other Current Assets At March 31, 2023 and December 31, 2022, prepaid expenses and other current assets consisted of the following: As of As of March 31, December 31, 2023 2022 (in thousands) Advances to suppliers $ 711 $ 867 Prepaid insurance 538 1,298 Prepaid income tax 1,256 432 Other current assets 478 1,242 Total $ 2,983 $ 3,839 |
Property, Plant and Mine Develo
Property, Plant and Mine Development, net | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Mine Development, net | |
Property, Plant and Mine Development, net | 7. Property, Plant and Mine Development, net At March 31, 2023 and December 31, 2022, property, plant and mine development, net consisted of the following: As of As of March 31, December 31, 2023 2022 (in thousands) Asset retirement costs $ 7,449 $ 7,449 Construction-in-progress 250 351 Furniture and office equipment 1,776 1,732 Land 9,033 9,033 Mineral interest 79,543 79,543 Light vehicles and other mobile equipment 2,144 2,327 Machinery and equipment 41,729 41,343 Mill facilities and infrastructure 35,924 35,917 Mine Development 107,916 105,263 Software and licenses 1,554 1,552 Subtotal (1) 287,318 284,510 Accumulated depreciation and amortization (138,321) (131,947) Total $ 148,997 $ 152,563 (1) Includes accrued capital expenditures of $0.3 million and $1.3 million at March 31, 2023 and December 31, 2022, respectively. The Company recorded depreciation and amortization expense of $7.3 million for the three months ended March 31, 2023 as compared to $6.0 million for the same period ended March 31, 2022. |
Other Non-current Assets
Other Non-current Assets | 3 Months Ended |
Mar. 31, 2023 | |
Other Non-current Assets | |
Other Non-current Assets | 8. Other Non-current Assets At March 31, 2023 and December 31, 2022, other non-current assets consisted of the following: As of As of March 31, December 31, 2023 2022 (in thousands) Investment in Maritime $ 1,561 $ 1,559 Investment in Green Light Metals 3,617 3,611 Other non-current assets 310 339 Total $ 5,488 $ 5,509 Investment in Maritime On September 22, 2022, the Company invested C$2.4 million (or $1.7 million) in the common shares of Maritime Resources Corp. The 47 million shares purchased represent 9.9% of the issued and outstanding shares of Maritime. Both as of March 31, 2023 and as of December 31, 2022, the value of the investment was $1.6 million. Investment in Green Light Metals A promissory note was acquired in the Aquila Resources Inc. (“Aquila”) acquisition. In October 2021, Aquila sold its Wisconsin assets to Green Light Metals in return for a C$4.9 million ($3.9 million) promissory note. In December 2022, an amended agreement was executed (1) amending the maturity date to December 28, 2022, (2) clarifying the definition of “qualified financing” which set the value to C$0.40 per share for the common shares that were to be issued at maturity; and (3) adding a top-up provision that would result in additional common shares being issued to the Company if any Green Light Metals financing was raised at less than C$0.40 per share before March 31, 2023, essentially preventing dilution and ensuring that the total value of the Green Light Metals shares held by the Company at March 31, 2023 remains at C$4.9 million. |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Accrued Expenses and Other Liabilities | 9. Accrued Expenses and Other Liabilities At March 31, 2023 and December 31, 2022, accrued expenses and other liabilities consisted of the following: As of As of March 31, December 31, 2023 2022 (in thousands) Accrued royalty payments $ 1,402 $ 1,787 IVA taxes payable, net 274 - Share-based compensation liability 168 - Liability for Aquila drillhole capping (1) 110 - Employee profit sharing obligation 2,350 2,206 Other payables 754 1,204 Total accrued expenses and other current liabilities $ 5,058 $ 5,197 Accrued non-current labor obligation $ 1,145 $ 1,050 Share-based compensation liability 1,040 884 Other long-term liabilities 120 556 Total other non-current liabilities $ 2,305 $ 2,490 (1) This is the current portion of the Company’s reclamation and remediation liabilities. Please see Note 11— Reclamation and Remediation in this Condensed Consolidated Interim Financial Statements and Notes for additional information. A value added (“IVA”) tax in Mexico is assessed on the sales of products and purchases of materials and services. Businesses owe IVA taxes as the business sells a product and collects IVA taxes from its customers. Likewise, businesses are generally entitled to recover the taxes they have paid related to purchases of materials and services, either as a refund or credit to IVA tax payable. Amounts recorded as IVA taxes in the consolidated financial statements represent the net estimated IVA tax payable or receivable, since there is a legal right of offset of IVA taxes. As of March 31, 2023, this resulted in a liability balance. |
Gold and Silver Stream Agreemen
Gold and Silver Stream Agreements | 3 Months Ended |
Mar. 31, 2023 | |
Gold and Silver Stream Agreements | |
Gold and Silver Stream Agreements | 10. Gold and Silver Stream Agreements The following table presents the Company’s liabilities related to the Gold and Silver Stream Agreements as of March 31, 2023 and December 31, 2022: As of As of March 31, December 31, 2023 2022 (in thousands) Liability related to the Gold Stream Agreement $ 20,938 $ 20,881 Liability related to the Silver Stream Agreement 22,802 22,585 Total liability $ 43,740 $ 43,466 Periodic interest expense will be incurred based on an implied interest rate. The implied interest rate is determined based on the timing and probability of future production and an 8% discount rate. Interest expense is recorded to the Consolidated Statements of Operations and the gold and silver stream agreement liability on the Consolidated Balance Sheet. Gold Streaming Agreement In November 2017, Aquila entered into a stream agreement with Osisko Bermuda Limited (“OBL”), a wholly owned subsidiary of Osisko Gold Royalties Ltd (TSX & NYSE: OR), pursuant to which OBL agreed to commit approximately $55 million to Aquila through a gold stream purchase agreement. In June 2020, Aquila amended its agreement with Osisko, reducing the total committed amount to $50 million, as well as adjusting certain milestone dates under the gold stream to align with the current project development timeline. Aquila had received a total of $20 million of the committed funds at the time of the Gold Resource Corporation acquisition. Remaining deposits from OBL are $5 million upon receipt of permits required for the development and operation of the Back Forty Project and $25 million upon the first drawdown of an appropriate project debt finance facility. OBL has been provided a general security agreement over the Back Forty Project, which consists of the subsidiaries of Gold Resource Acquisition Sub. Inc., a 100% owned subsidiary of Gold Resource Corporation. The initial term of the agreement is for 40 years, automatically renewable for successive ten-year periods. The agreement is subject to certain operating and financial covenants, which are in good standing as of March 31, 2023. The $20 million received from OBL through March 31, 2023 is shown as a long-term liability on the Consolidated Balance Sheet, along with an implied interest. The implied interest rate is applied on OBL advance payments and calculated on the total expected life-of-mine production to be deliverable (as supported in the Back Forty Project Preliminary Economic Assessment) at December 31, 2022 closing gold and silver metal price and is discounted at 8.0%. As the remaining $30 million deposit is subject to the completion of certain milestones and the satisfaction of certain other conditions, this amount is not reflected on the Consolidated Balance Sheet. Per the terms of the gold stream agreement, OBL will purchase 18.5% of the refined gold from Back Forty (the “Threshold Stream Percentage”) until the Company has delivered 105,000 ounces of gold (the “Production Threshold”). Upon satisfaction of the Production Threshold, the Threshold Stream Percentage will be reduced to 9.25% of the refined gold (the “Tail Stream”). In exchange for the refined gold delivered under the Stream Agreement, OBL will pay the Company ongoing payments equal to 30% of the spot price of gold on the day of delivery, subject to a maximum payment of $600 per ounce. Where the market price of gold is greater than the price paid, the difference realized from the sale of the gold will be applied against the deposit received from Osisko. (See Note 12—Commitments and Contingencies Item 8—Financial Statements and Supplementary Data Silver Stream Agreement Through a series of contracts, Aquila executed a silver stream agreement with OBL to purchase 85% of the silver produced and sold at the Back Forty Project. A total of $17.2 million has been advanced under the agreement of March 31, 2023. There are no future deposits remaining under the agreement. The initial term of the agreement is for 40 years, automatically renewable for successive ten-year periods. The agreement is subject to certain operating and financial covenants, which are in good standing as of March 31, 2023. Per the terms of the silver stream agreement, OBL will purchase 85% of the silver produced from the Back Forty Project at a fixed price of $4 per ounce of silver. Where the market price of silver is greater than $4 per ounce, the difference realized from the sale of the silver will be applied against the deposit received from Osisko. The $17.2 million received from OBL through March 31, 2023 is shown as a long-term liability on the Consolidated Balance Sheet along with an implied interest. (See Note 12—Commitments and Contingencies Item 8—Financial Statements and Supplementary Data |
Reclamation and Remediation
Reclamation and Remediation | 3 Months Ended |
Mar. 31, 2023 | |
Reclamation and Remediation | |
Reclamation and Remediation | 11. Reclamation and Remediation The following table presents the reclamation and remediation obligations as of March 31, 2023 and December 31, 2022: As of As of March 31, December 31, 2023 2022 (in thousands) Current reclamation and remediation liabilities (1) $ 110 $ - Non-current reclamation and remediation liabilities 11,669 10,366 Total $ 11,779 $ 10,366 (1) The current portion of reclamation and remediation liabilities are included in Accrued expenses and other current liabilities. Please see Note 9— Accrued Expenses and Other Liabilities in this Condensed Consolidated Interim Financial Statements and Notes for additional information. The following table presents the changes in reclamation and remediation obligations for the three months ended March 31, 2023 and the year ended December 31, 2022: 2023 2022 (in thousands) Reclamation liabilities – balance at beginning of period $ 1,949 $ 1,833 Foreign currency exchange loss 135 116 Reclamation liabilities – balance at end of period 2,084 1,949 Asset retirement obligation – balance at beginning of period (1) 8,417 1,279 Changes in estimate (1) - 6,384 Liability for Aquila drillhole capping (2) 514 - Accretion 173 668 Foreign currency exchange loss 591 86 Asset retirement obligation – balance at end of period 9,695 8,417 Total period end balance $ 11,779 $ 10,366 (1) In 2022, the Company updated its closure plan study, which resulted in a $6.4 million increase in the estimated liability and asset retirement costs. This increase is a result of formalizing a tailings storage facility closure plan, the addition of the dry stack facility and the filtration plant, and the increase of inflation in Mexico. (2) As of December 31, 2022, the Company reported the liability to remediate exploration drill holes at the Back Forty Project in Michigan, USA in other non-current liabilities. As of March 31, 2023, this liability was reclassified to non-current reclamation and remediation liabilities. Upon completion of the optimized feasibility study and the related mine closure plan, an asset for asset retirement obligation and corresponding liability for reclamation and remediation will be recorded. The Company’s undiscounted reclamation liabilities of $2.1 million and $1.9 million as of March 31, 2023 and December 31, 2022, respectively, are related to the Don David Gold Mine in Mexico. These represent reclamation liabilities that were expensed through 2013 before proven and probable reserves were established and the Company was considered to be a development stage entity; therefore, most of the costs, including asset retirement costs, were not allowed to be capitalized as part of our Property, Plant & Mine Development. The Company’s asset retirement obligations reflect the additions to the asset for reclamation and remediation costs in Property, Plant & Mine Development, post 2013 development stage status, which are discounted using a credit adjusted risk-free rate of 8%. As of March 31, 2023 and December 31, 2022, the Company’s asset retirement obligation related to was $9.7 million and $8.4 million, respectively, and was mostly related to the Don David Gold Mine in Mexico. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies | |
Commitments and Contingencies | 12. Commitments and Contingencies Commitments As of March 31, 2023 and December 31, 2022, the Company has equipment purchase commitments of approximately $1.0 million and $1.2 million, respectively. Contingent Consideration With the Aquila acquisition, the Company assumed a contingent consideration related to the December 30, 2013, Aquila acquisition of 100% of the shares of HudBay Michigan Inc. (“HMI”), a subsidiary of HudBay Minerals Inc. (“HudBay”), effectively giving Aquila 100% ownership in the Back Forty Project (the “HMI Acquisition”). Pursuant to the HMI Acquisition, HudBay’s 51% interest in the Back Forty Project was acquired in consideration for the issuance of common shares of Aquila, future milestone payments tied to the development of the Back Forty Project, and a 1% net smelter return royalty on production from certain land parcels in the project. The issuance of shares and 1% net smelter obligations were settled before the Company acquired Aquila. The contingent consideration is composed of the following in Canadian dollars: The value of future installments is based on C$9 million tied to development of the Back Forty project as follows: a. C $3 million payable on completion of any form of financing for purposes including the commencement of construction of Back Forty. Up to 50% of the C $3 million can be paid, at the Company’s option, in Gold Resource Corporation shares with the balance payable in cash. (If, as of November 2023, this milestone has not been achieved or payment made, HMI has the right to repurchase a 51% ownership in the Back Forty Project); b. C $2 million payable in cash 90 days after the commencement of commercial production; c. C $2 million payable in cash 270 days after the commencement of commercial production; and d. C $2 million payable in cash 450 days after the commencement of commercial production. The value of the contingent consideration as of March 31, 2023 was $4.4 million, including $2.2 million in current liabilities and $2.2 million in non-current liabilities. It is more likely than not that management will pay C$3 million ($2.2 million) of the liability in 2023 in order to prevent the repurchase of 51% ownership by HMI. Therefore, this portion is presented as current liability, with $2.2 million remaining in long-term liability. The contingent consideration is adjusted for the time value of money and the likelihood of the milestone payments. Any future changes in the value of the contingent consideration will be recognized in the Consolidated Statements of Operations. Other Contingencies The Company has certain other contingencies resulting from litigation, claims, and other commitments and is subject to a variety of environmental and safety laws and regulations incident to the ordinary course of business. The Company currently has no basis to conclude that any or all of such contingencies will materially affect its financial position, results of operations, or cash flows. However, in the future, there may be changes to these contingencies, or additional contingencies may occur, any of which might result in an accrual or a change in current accruals recorded by the Company, and there can be no assurance that their ultimate disposition will not have a material adverse effect on the Company’s financial position, results of operations or cash flows. With the acquisition of Aquila Resources Inc. on December 10, 2021, the Company assumed substantial liabilities that relate to the gold and silver stream agreements with Osisko Bermuda Limited. Under the agreements, Osisko deposited a total of $37.2 million upfront in exchange for a portion of the future gold and silver production from the Back Forty Project. The stream agreements contain customary provisions regarding default and security. In the event that our subsidiary defaults under the stream agreements, including failing to achieve commercial production at a future date, it may be required to repay the deposit plus accumulated interest at a rate agreed with Osisko. If it fails to do so, Osisko may be entitled to enforce its remedies as a secured party and take possession of the assets that comprise the Back Forty Project. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2023 | |
Shareholders' Equity | |
Shareholders' Equity | 13. Shareholders’ Equity No dividends were declared and paid in 2023. During the three months ended March 31, 2022, the Company declared and paid dividends of $0.01 per common share, paying an aggregate total of $0.9 million. |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2023 | |
Derivatives | |
Derivatives | 14. Derivatives Embedded Derivatives Concentrate Sales Concentrate sales contracts contain embedded derivatives due to the provisional pricing terms for unsettled shipments. At the end of each reporting period, the Company records an adjustment to accounts receivable and revenue to reflect the mark-to-market adjustments for outstanding provisional invoices based on forward metal prices. Please see Note—20 Fair Value Measurement Condensed Consolidated Interim Financial Statements and Notes The following table summarizes the Company’s unsettled sales contracts at March 31, 2023 with the quantities of metals under contract subject to final pricing expected to occur through May 2023: Gold Silver Copper Lead Zinc Total (ounces) (ounces) (tonnes) (tonnes) (tonnes) Under contract 4,390 256,430 207 1,720 2,183 Average forward price (per ounce or tonne) $ 1,885 $ 22.08 $ 8,880 $ 2,092 $ 3,078 Unsettled sales contracts value (in thousands) $ 8,275 $ 5,662 $ 1,838 $ 3,598 $ 6,719 $ 26,092 Other Derivatives Zinc zero cost collar Derivative instruments that are not designated as hedging instruments are required to be recorded on the balance sheet at fair value. Changes in fair value will impact the Company’s earnings through mark-to-market adjustments until the physical commodity is delivered or the financial instrument is settled. The fair value does not reflect the realized or cash value of the instrument. As of December 31, 2022, the Company’s hedge program concluded, but the Company may utilize similar programs in the future to manage near-term exposure to cash flow variability from metal prices. The Company manages credit risk by selecting counterparties believed to be financially strong, by entering into netting arrangements with counterparties and by requiring other credit risk mitigants, as appropriate. The Company actively evaluates the creditworthiness of its counterparties, assigns appropriate credit limits, and monitors credit exposures against those assigned limits. |
Employee Benefits
Employee Benefits | 3 Months Ended |
Mar. 31, 2023 | |
Employee Benefits | |
Employee Benefits | 15. Employee Benefits Effective October 2012, the Company adopted a profit sharing plan (the “Plan”) which covers all U.S. employees. The Plan meets the requirements of a qualified retirement plan pursuant to the provisions of Section 401(k) of the Internal Revenue Code. The Plan also provides eligible employees the opportunity to make tax deferred contributions to a retirement trust account up to 50% of their qualified wages, subject to the IRS annual maximums. Under Mexican law, employees are entitled to receive statutory profit sharing (Participacion a los Trabajadores de las Utilidades or “PTU”) payment. The required cash payment to employees in the aggregate is equal to 10% of their employer’s profit subject to PTU, which differs from profit determined under U.S. GAAP. Please see Note 9 — Accrued Expenses and Other Liabilities Condensed Consolidated Interim Financial Statements and Notes |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Stock-Based Compensation | |
Stock-Based Compensation | 16. Stock-Based Compensation The Company’s compensation program comprises three main elements: base salary, an annual short-term incentive plan (“STIP”) cash award, and long-term equity-based incentive compensation (“LTIP”) in the form of deferred stock units (“DSUs”), restricted stock units (“RSUs”), stock options, and performance share units (“PSUs”). The Gold Resource Corporation 2016 Equity Incentive Plan (the “Incentive Plan”) allows for the issuance of up to 5 million shares of common stock in the form of incentive and non-qualified stock options, stock appreciation rights, RSUs, stock grants, stock units, performance shares, PSUs, and performance cash. Additionally, pursuant to the terms of the Incentive Plan, any award outstanding under the prior plan that is terminated, expired, forfeited, or canceled for any reason, will be available for grant under the Incentive Plan. DSUs of 278,663 and 214,357 were granted to the Board of Directors during the three months ended March 31, 2023 and 2022, respectively. DSUs are vested immediately and redeemable in cash or shares at the earlier of 10 years or upon the eligible directors’ termination. Termination is deemed to occur on the earliest of: (1) the date of voluntary resignation or retirement of the director from the Board; (2) the date of death of the director; or (3) the date of removal of the director from the Board whether by shareholder resolution, failure to achieve re-election, or otherwise; and on which date the director is not a director or employee of the Company or any of its affiliates. These awards contain a cash settlement feature and are therefore classified as a liability and are marked to market each reporting period. The Company may also issue DSUs for directors in lieu of board fees at their request. During the three months ended March 31, 2023 and 2022, respectively, there were 13,649 and 3,356 DSUs granted in lieu of board fees that are also subject to mark-to-market adjustment. Additionally, during the three months ended March 31, 2023, executives were granted 212,407 DSUs in lieu of half of their STIP cash bonus for 2022. As of March 31, 2023 and 2022, the non-current liability balances related to DSUs were $0.9 million and $0.8 million, respectively. For the three months ended March 31, 2023 and 2022, respectively, the changes in liabilities related to DSUs resulted in $0.4 million and $0.6 million stock-based compensation expense. RSUs of 612,059 and 234,605 were granted during the three months ended March 31, 2023 and 2022, respectively. During the three months ended March 31, 2023 and 2022, respectively, a total of 195,525 and nil RSUs vested. For the RSUs vesting in 2023, 70,433 common shares were issued with an intrinsic value and a fair value of $61,981, RSUs of 18,137 were withheld for taxes due to net settlement, and 106,955 RSUs were deferred. Stock options of nil and 320,816 were granted during the three months ended March 31, 2023 and 2022, respectively. Stock options of nil and 355,000, respectively, were exercised during the three months ended March 31, 2023 and 2022. The exercises in 2022 were settled in cash. PSUs of 534,890 and 294,147 were granted during the three months ended March 31, 2023 and 2022, respectively. PSUs cliff vest usually in three years based on the relative and absolute total shareholder return of a predetermined peer group and are expected to be settled in cash. As of March 31, 2023 and 2022, the current liability balances related to PSUs were $0.2 million and nil, respectively, and the non-current liability balances related to PSUs were $0.1 million and nil, respectively. Stock-based compensation expense for the periods presented is as follows: For the three months ended March 31, 2023 2022 (in thousands) Deferred stock units 357 577 Restricted stock units 153 48 Stock options $ 120 $ 149 Performance stock units (33) - Total $ 597 $ 774 The Co . |
Zinc Zero Cost Collar
Zinc Zero Cost Collar | 3 Months Ended |
Mar. 31, 2023 | |
Zinc Zero Cost Collar | |
Zinc Zero Cost Collar | 17. Zinc Zero Cost Collar During the three months ended March 31, 2023 and 2022, the realized and unrealized (gains) losses related to the Company’s Zinc Zero Cost Collar are the following: For the three months ended March 31, 2023 2022 (in thousands) Realized loss on zinc zero cost collar $ - $ 1,628 Unrealized loss on zinc zero cost collar (1) - 2,509 Total $ - $ 4,137 On May 18, 2021, the Company entered into a Trading Agreement with Auramet International LLC that governs nonexchange traded, over-the-counter, spot, forward and option transactions on both a deliverable and non-deliverable basis involving various metals and currencies. Gains and losses due to changes in fair value are non-cash in nature until such time that they are realized through cash transactions. Please see Note 14—Derivatives Condensed Consolidated Interim Financial Statements and Notes |
Other Expense, net
Other Expense, net | 3 Months Ended |
Mar. 31, 2023 | |
Other (Income) Expense, Net | |
Other (Income) Expense, Net | 18. Other Expense, net Other expense, net, for the periods presented consisted of the following: For the three months ended March 31, 2023 2022 (in thousands) Unrealized currency exchange loss (1) $ 453 $ 445 Realized currency exchange loss 176 129 Realized and unrealized gain from gold and silver rounds, net (9) (36) Interest on streaming liabilities 274 176 Severance (2) 610 - Other (income) expense (35) 124 Total $ 1,469 $ 838 (1) Gains and losses due to changes in fair value are non-cash in nature until such time that they are realized through cash transactions. For additional information regarding the Company’s fair value measurements and investments, please see Note 20—Fair Value Measurement in this Condensed Consolidated Interim Financial Statements and Notes for additional information . (2) This is due to an organized reduction of workforce and leadership change at DDGM in Mexico . |
Net Income per Common Share
Net Income per Common Share | 3 Months Ended |
Mar. 31, 2023 | |
Net Income per Common Share | |
Net Income per Common Share | 19. Net Income per Common Share Basic net income per common share is calculated based on the weighted average number of common shares outstanding for the period. Diluted earnings per common share are calculated based on the assumption that stock options and other dilutive securities outstanding, which have an exercise price less than the average market price of the Company’s common shares during the period, would have been exercised on the later of the beginning of the period or the date granted and that the funds obtained from the exercise were used to purchase common shares at the average market price during the period. All the Company’s RSUs are considered to be dilutive in periods with net income. The effect of the Company’s dilutive securities is calculated using the treasury stock method and only those instruments that result in a reduction in net income per common share are included in the calculation. Options to purchase 1.5 million shares of common stock at weighted average exercise prices of $2.90 were outstanding as of March 31, 2023 but had no dilutive effect due to the net loss. Options to purchase 2.7 million shares of common stock at a weighted average exercise prices of $4.08 were outstanding as of March 31, 2022 but were not included in the computation of diluted weighted average common shares outstanding, as the exercise price of the options exceeded the average price of the Company’s common stock during the reporting period, and therefore are anti-dilutive. Basic and diluted net income per common share is calculated as follows: For the three months ended March 31, 2023 2022 Numerator: Net (loss) income (in thousands) $ (1,035) $ 4,019 Denominator: Basic weighted average shares of common stock outstanding 88,405,935 88,338,774 Dilutive effect of share-based awards - 278,094 Diluted weighted average common shares outstanding 88,405,935 88,616,868 Basic and diluted net (loss) income per common share $ (0.01) $ 0.05 |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurement | |
Fair Value Measurement | 20. Fair Value Measurement Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. These assets and liabilities are remeasured for each reporting period. The following tables set forth certain of the Company’s assets and liabilities measured at fair value by level within the fair value hierarchy as of March 31, 2023 and December 31, 2022: As of As of March 31, December 31, Input Hierarchy Level 2023 2022 (in thousands) Cash and cash equivalents $ 21,420 $ 23,675 Level 1 Accounts receivable, net $ 5,134 $ 5,085 Level 2 Investment in equity securities-Maritime $ 1,561 $ 1,559 Level 1 Investment in equity securities-Green Light Metals $ 3,617 $ 3,611 Level 3 The following methods and assumptions were used to estimate the fair value of each class of financial instrument: Cash and cash equivalents Accounts receivable, net: At March 31, 2023 and December 31, 2022, the Company had an unrealized loss of $0.1 million and an unrealized gain of $0.6 million, respectively, included in its accounts receivable on the accompanying Consolidated Balance Sheets related to mark-to-market adjustments. Please see Note 14—Derivatives Condensed Consolidated Interim Financial Statements and Notes Investment in equity securities—Maritime Investment in equity securities—Green Light Metals Gains and losses related to changes in the fair value of these financial instruments were included in the Company’s Condensed Consolidated Interim Statements of Operations as shown in the following table: For the three months ended March 31, Statements of Operations Classification 2023 2022 Note Realized and unrealized derivative (loss) gain, net 14 $ (87) $ 2,034 Sales, net Realized loss on zinc zero cost collar 17 $ - $ (1,628) Realized and unrealized loss on zinc zero cost collar Unrealized loss on zinc zero cost collar 17 $ - $ (2,509) Realized and unrealized loss on zinc zero cost collar Realized/Unrealized Derivatives The following tables summarize the Company’s realized/unrealized derivatives for the periods presented (in thousands) Gold Silver Copper Lead Zinc Total For the three months ended March 31, 2023 Realized gain $ 114 $ 149 $ 54 $ 94 $ 223 $ 634 Unrealized loss (37) (271) (10) (103) (300) (721) Total realized/unrealized derivatives, net $ 77 $ (122) $ 44 $ (9) $ (77) $ (87) Gold Silver Copper Lead Zinc Total For the three months ended March 31, 2022 Realized gain $ 126 $ 249 $ 43 $ 19 $ 429 $ 866 Unrealized gain 242 275 16 47 588 1,168 Total realized/unrealized derivatives, net $ 368 $ 524 $ 59 $ 66 $ 1,017 $ 2,034 |
Supplementary Cash Flow Informa
Supplementary Cash Flow Information | 3 Months Ended |
Mar. 31, 2023 | |
Supplementary Cash Flow Information | |
Supplementary Cash Flow Information | 21. Supplementary Cash Flow Information Other operating adjustments and write-downs within the net cash provided by operations on the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 consisted of the following: For the three months ended March 31, 2023 2022 (in thousands) Unrealized (gain) loss on gold and silver rounds $ (9) $ (70) Unrealized foreign currency exchange loss 453 445 Unrealized (gain) loss on zinc zero cost collar - 2,509 Other 187 (333) Total other operating adjustments $ 631 $ 2,551 |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting | |
Segment Reporting | 22. Segment Reporting As of March 31, 2023, the Company has organized its operations into three geographic regions: Oaxaca, Mexico, Michigan, U.S.A., and Corporate and Other. Oaxaca, Mexico represents the Company’s only production stage property. Michigan, U.S.A. is an advanced exploration stage property. Intercompany revenue and expense amounts have been eliminated within each segment in order to report on the basis that management uses internally for evaluating segment performance. The Company’s business activities that are not considered production stage or advanced exploration stage properties are included in Corporate and Other. The following table shows selected information from the Consolidated Balance Sheets relating to the Company’s segments (in thousands): Oaxaca, Mexico Michigan, USA Corporate and Other Consolidated As of March 31, 2023 Total current assets $ 35,626 $ 144 $ 4,946 $ 40,716 Total non-current assets 59,759 92,908 1,818 154,485 Total assets $ 95,385 $ 93,052 $ 6,764 $ 195,201 Total current liabilities $ 12,904 2,649 1,080 $ 16,633 Total non-current liabilities 5,142 60,717 1,718 67,577 Total shareholders' equity 77,339 29,686 3,966 110,991 Total liabilities and shareholders' equity $ 95,385 $ 93,052 $ 6,764 $ 195,201 As of December 31, 2022 Total current assets $ 38,032 $ 272 $ 7,795 $ 46,099 Total non-current assets 63,342 92,927 1,803 158,072 Total assets $ 101,374 $ 93,199 $ 9,598 $ 204,171 Total current liabilities $ 20,035 $ 3,352 $ 1,295 $ 24,682 Total non-current liabilities 5,533 60,648 1,544 67,725 Total shareholders' equity 75,806 29,199 6,759 111,764 Total liabilities and shareholders' equity $ 101,374 $ 93,199 $ 9,598 $ 204,171 The following table shows selected information from the Consolidated Statements of Operations relating to the Company’s segments (in thousands): Oaxaca, Mexico Michigan, USA Corporate and Other Consolidated For the three months ended March 31, 2023 Sales, net $ 31,228 $ - $ - $ 31,228 Total mine cost of sales, including depreciation 26,660 14 625 27,299 Exploration expense 1,389 450 - 1,839 Total other costs and expenses, including G&A 631 244 2,384 3,259 Provision for income taxes 50 (222) 38 (134) Net income (loss) $ 2,498 $ (486) $ (3,047) $ (1,035) For the three months ended March 31, 2022 Sales, net $ 45,417 $ - $ - $ 45,417 Total mine cost of sales, including depreciation 26,094 - - 26,094 Exploration expense 1,237 1,068 - 2,305 Total other costs and expenses, including G&A 4,692 317 2,639 7,648 Provision for income taxes 5,351 - - 5,351 Net income (loss) $ 8,043 $ (1,385) $ (2,639) $ 4,019 |
Basis of Preparation of Finan_2
Basis of Preparation of Financial Statements (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Basis of Preparation of Financial Statements | |
Basis of Presentation | The Condensed Consolidated Interim Financial Statements (“interim financial statements”) of Gold Resource Corporation and its subsidiaries (collectively, the “Company”) are unaudited and have been prepared in accordance with the rules of the Securities and Exchange Commission (“SEC”) for interim statements. Certain information and footnote disclosures required by United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted as permitted by such rules, although the Company believes that the disclosures included are adequate to make the information presented not misleading. In the opinion of management, all adjustments (including normal recurring adjustments) and disclosures necessary for a fair presentation of these interim financial statements have been included. The results reported in these interim financial statements are not necessarily indicative of the results that may be reported for the entire year. These interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2022 included in the Company’s annual report on Form 10-K. The year-end balance sheet data was derived from the audited financial statements. Unless otherwise noted, there have been no material changes to the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s annual report on Form 10-K. Certain items in the prior period’s consolidated financial statements and notes have been reclassified to conform to the current presentation. In the first quarter of 2022, exploration expenses included both the Don David Gold Mine (“DDGM”) exploration expenses and the Back Forty Project expenses. In 2023, these are presented on separate lines in the Consolidated Statements of Operations to align with the current presentation. These reclassifications had no effect on the reported results of operations. |
Recently Adopted Accounting S_2
Recently Adopted Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Recently Adopted Accounting Standards | |
Recently Adopted Accounting Standards | Recent accounting pronouncements issued have been evaluated and do not presently impact our financial statements and supplemental data. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue | |
Summary of revenue from the sale of dore and concentrate | For the three months ended March 31, 2023 2022 (in thousands) Doré sales, net Gold $ 1,725 $ 1,244 Silver 69 20 Less: Refining charges (25) (7) Total doré sales, net 1,769 1,257 Concentrate sales Gold 10,622 14,541 Silver 6,573 6,085 Copper 2,994 4,097 Lead 2,965 3,827 Zinc 9,551 16,317 Less: Treatment and refining charges (3,159) (2,741) Total concentrate sales, net 29,546 42,126 Realized gain - embedded derivative, net (1) 634 866 Unrealized (loss) gain - embedded derivative, net (721) 1,168 Total sales, net $ 31,228 $ 45,417 (1) Copper, lead, and zinc are co-products. In the Realized gain - embedded derivative, net, there is $0.4 million gain related to these co-products for the three months ended March 31, 2023. There is $0.5 million gain in the Realized gain - embedded derivative, net, related to the co-products for the three months ended March 31, 2022. |
Inventories, net (Tables)
Inventories, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventories, net | |
Summary of Inventories | As of As of March 31, December 31, 2023 2022 (in thousands) Stockpiles - underground mine $ 171 $ 597 Concentrates 2,035 3,271 Doré, net 382 653 Subtotal - product inventories 2,588 4,521 Materials and supplies (1) 8,591 8,979 Total $ 11,179 $ 13,500 (1) Net of reserve for obsolescence of $0.1 million as of March 31, 2023 and December 31, 2022. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Prepaid Expenses And Other Current Assets | |
Schedule of prepaid and other assets | As of As of March 31, December 31, 2023 2022 (in thousands) Advances to suppliers $ 711 $ 867 Prepaid insurance 538 1,298 Prepaid income tax 1,256 432 Other current assets 478 1,242 Total $ 2,983 $ 3,839 |
Property, Plant and Mine Deve_2
Property, Plant and Mine Development, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Mine Development, net | |
Schedule of property, plant and mine development | As of As of March 31, December 31, 2023 2022 (in thousands) Asset retirement costs $ 7,449 $ 7,449 Construction-in-progress 250 351 Furniture and office equipment 1,776 1,732 Land 9,033 9,033 Mineral interest 79,543 79,543 Light vehicles and other mobile equipment 2,144 2,327 Machinery and equipment 41,729 41,343 Mill facilities and infrastructure 35,924 35,917 Mine Development 107,916 105,263 Software and licenses 1,554 1,552 Subtotal (1) 287,318 284,510 Accumulated depreciation and amortization (138,321) (131,947) Total $ 148,997 $ 152,563 (1) Includes accrued capital expenditures of $0.3 million and $1.3 million at March 31, 2023 and December 31, 2022, respectively. |
Other Non-current Assets (Table
Other Non-current Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Non-current Assets | |
Schedule of other non-current assets | As of As of March 31, December 31, 2023 2022 (in thousands) Investment in Maritime $ 1,561 $ 1,559 Investment in Green Light Metals 3,617 3,611 Other non-current assets 310 339 Total $ 5,488 $ 5,509 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Schedule of accrued expenses and other current liabilities | As of As of March 31, December 31, 2023 2022 (in thousands) Accrued royalty payments $ 1,402 $ 1,787 IVA taxes payable, net 274 - Share-based compensation liability 168 - Liability for Aquila drillhole capping (1) 110 - Employee profit sharing obligation 2,350 2,206 Other payables 754 1,204 Total accrued expenses and other current liabilities $ 5,058 $ 5,197 Accrued non-current labor obligation $ 1,145 $ 1,050 Share-based compensation liability 1,040 884 Other long-term liabilities 120 556 Total other non-current liabilities $ 2,305 $ 2,490 (1) This is the current portion of the Company’s reclamation and remediation liabilities. Please see Note 11— Reclamation and Remediation in this Condensed Consolidated Interim Financial Statements and Notes for additional information. |
Gold and Silver Stream Agreem_2
Gold and Silver Stream Agreements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Gold and Silver Stream Agreements | |
Schedule of liabilities related to the deferred revenues | As of As of March 31, December 31, 2023 2022 (in thousands) Liability related to the Gold Stream Agreement $ 20,938 $ 20,881 Liability related to the Silver Stream Agreement 22,802 22,585 Total liability $ 43,740 $ 43,466 |
Reclamation and Remediation (Ta
Reclamation and Remediation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Reclamation and Remediation | |
Summary of Reclamation and Remediation Obligation | As of As of March 31, December 31, 2023 2022 (in thousands) Current reclamation and remediation liabilities (1) $ 110 $ - Non-current reclamation and remediation liabilities 11,669 10,366 Total $ 11,779 $ 10,366 (1) The current portion of reclamation and remediation liabilities are included in Accrued expenses and other current liabilities. Please see Note 9— Accrued Expenses and Other Liabilities in this Condensed Consolidated Interim Financial Statements and Notes for additional information. |
Summary of Changes in Reclamation and Remediation | 2023 2022 (in thousands) Reclamation liabilities – balance at beginning of period $ 1,949 $ 1,833 Foreign currency exchange loss 135 116 Reclamation liabilities – balance at end of period 2,084 1,949 Asset retirement obligation – balance at beginning of period (1) 8,417 1,279 Changes in estimate (1) - 6,384 Liability for Aquila drillhole capping (2) 514 - Accretion 173 668 Foreign currency exchange loss 591 86 Asset retirement obligation – balance at end of period 9,695 8,417 Total period end balance $ 11,779 $ 10,366 (1) In 2022, the Company updated its closure plan study, which resulted in a $6.4 million increase in the estimated liability and asset retirement costs. This increase is a result of formalizing a tailings storage facility closure plan, the addition of the dry stack facility and the filtration plant, and the increase of inflation in Mexico. (2) As of December 31, 2022, the Company reported the liability to remediate exploration drill holes at the Back Forty Project in Michigan, USA in other non-current liabilities. As of March 31, 2023, this liability was reclassified to non-current reclamation and remediation liabilities. Upon completion of the optimized feasibility study and the related mine closure plan, an asset for asset retirement obligation and corresponding liability for reclamation and remediation will be recorded. |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivatives | |
Summary of unsettled sales contracts | Gold Silver Copper Lead Zinc Total (ounces) (ounces) (tonnes) (tonnes) (tonnes) Under contract 4,390 256,430 207 1,720 2,183 Average forward price (per ounce or tonne) $ 1,885 $ 22.08 $ 8,880 $ 2,092 $ 3,078 Unsettled sales contracts value (in thousands) $ 8,275 $ 5,662 $ 1,838 $ 3,598 $ 6,719 $ 26,092 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Stock-Based Compensation | |
Stock-based compensation expense | For the three months ended March 31, 2023 2022 (in thousands) Deferred stock units 357 577 Restricted stock units 153 48 Stock options $ 120 $ 149 Performance stock units (33) - Total $ 597 $ 774 |
Zinc Zero Cost Collar (Tables)
Zinc Zero Cost Collar (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Zinc Zero Cost Collar | |
Schedule of realized and unrealized losses related to Zinc Zero Cost Collar | For the three months ended March 31, 2023 2022 (in thousands) Realized loss on zinc zero cost collar $ - $ 1,628 Unrealized loss on zinc zero cost collar (1) - 2,509 Total $ - $ 4,137 |
Other Expense, net (Tables)
Other Expense, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other (Income) Expense, Net | |
Schedule of Other (Income) Expense, net | For the three months ended March 31, 2023 2022 (in thousands) Unrealized currency exchange loss (1) $ 453 $ 445 Realized currency exchange loss 176 129 Realized and unrealized gain from gold and silver rounds, net (9) (36) Interest on streaming liabilities 274 176 Severance (2) 610 - Other (income) expense (35) 124 Total $ 1,469 $ 838 (1) Gains and losses due to changes in fair value are non-cash in nature until such time that they are realized through cash transactions. For additional information regarding the Company’s fair value measurements and investments, please see Note 20—Fair Value Measurement in this Condensed Consolidated Interim Financial Statements and Notes for additional information . (2) This is due to an organized reduction of workforce and leadership change at DDGM in Mexico . |
Net Income per Common Share (Ta
Net Income per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Net Income per Common Share | |
Schedule of net income per common share | For the three months ended March 31, 2023 2022 Numerator: Net (loss) income (in thousands) $ (1,035) $ 4,019 Denominator: Basic weighted average shares of common stock outstanding 88,405,935 88,338,774 Dilutive effect of share-based awards - 278,094 Diluted weighted average common shares outstanding 88,405,935 88,616,868 Basic and diluted net (loss) income per common share $ (0.01) $ 0.05 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurement | |
Assets measured at fair value by level within fair value hierarchy | As of As of March 31, December 31, Input Hierarchy Level 2023 2022 (in thousands) Cash and cash equivalents $ 21,420 $ 23,675 Level 1 Accounts receivable, net $ 5,134 $ 5,085 Level 2 Investment in equity securities-Maritime $ 1,561 $ 1,559 Level 1 Investment in equity securities-Green Light Metals $ 3,617 $ 3,611 Level 3 |
Gains and Losses Related to Changes in Fair Value | For the three months ended March 31, Statements of Operations Classification 2023 2022 Note Realized and unrealized derivative (loss) gain, net 14 $ (87) $ 2,034 Sales, net Realized loss on zinc zero cost collar 17 $ - $ (1,628) Realized and unrealized loss on zinc zero cost collar Unrealized loss on zinc zero cost collar 17 $ - $ (2,509) Realized and unrealized loss on zinc zero cost collar |
Realized and Unrealized Gain Losses on Derivatives | The following tables summarize the Company’s realized/unrealized derivatives for the periods presented (in thousands) Gold Silver Copper Lead Zinc Total For the three months ended March 31, 2023 Realized gain $ 114 $ 149 $ 54 $ 94 $ 223 $ 634 Unrealized loss (37) (271) (10) (103) (300) (721) Total realized/unrealized derivatives, net $ 77 $ (122) $ 44 $ (9) $ (77) $ (87) Gold Silver Copper Lead Zinc Total For the three months ended March 31, 2022 Realized gain $ 126 $ 249 $ 43 $ 19 $ 429 $ 866 Unrealized gain 242 275 16 47 588 1,168 Total realized/unrealized derivatives, net $ 368 $ 524 $ 59 $ 66 $ 1,017 $ 2,034 |
Supplementary Cash Flow Infor_2
Supplementary Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Supplementary Cash Flow Information | |
Schedule of Supplementary Cash Flow Information | For the three months ended March 31, 2023 2022 (in thousands) Unrealized (gain) loss on gold and silver rounds $ (9) $ (70) Unrealized foreign currency exchange loss 453 445 Unrealized (gain) loss on zinc zero cost collar - 2,509 Other 187 (333) Total other operating adjustments $ 631 $ 2,551 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting | |
Schedule of financial information relating to the Company segments | The following table shows selected information from the Consolidated Balance Sheets relating to the Company’s segments (in thousands): Oaxaca, Mexico Michigan, USA Corporate and Other Consolidated As of March 31, 2023 Total current assets $ 35,626 $ 144 $ 4,946 $ 40,716 Total non-current assets 59,759 92,908 1,818 154,485 Total assets $ 95,385 $ 93,052 $ 6,764 $ 195,201 Total current liabilities $ 12,904 2,649 1,080 $ 16,633 Total non-current liabilities 5,142 60,717 1,718 67,577 Total shareholders' equity 77,339 29,686 3,966 110,991 Total liabilities and shareholders' equity $ 95,385 $ 93,052 $ 6,764 $ 195,201 As of December 31, 2022 Total current assets $ 38,032 $ 272 $ 7,795 $ 46,099 Total non-current assets 63,342 92,927 1,803 158,072 Total assets $ 101,374 $ 93,199 $ 9,598 $ 204,171 Total current liabilities $ 20,035 $ 3,352 $ 1,295 $ 24,682 Total non-current liabilities 5,533 60,648 1,544 67,725 Total shareholders' equity 75,806 29,199 6,759 111,764 Total liabilities and shareholders' equity $ 101,374 $ 93,199 $ 9,598 $ 204,171 |
Schedule of asset balances, excluding investments and intercompany | The following table shows selected information from the Consolidated Statements of Operations relating to the Company’s segments (in thousands): Oaxaca, Mexico Michigan, USA Corporate and Other Consolidated For the three months ended March 31, 2023 Sales, net $ 31,228 $ - $ - $ 31,228 Total mine cost of sales, including depreciation 26,660 14 625 27,299 Exploration expense 1,389 450 - 1,839 Total other costs and expenses, including G&A 631 244 2,384 3,259 Provision for income taxes 50 (222) 38 (134) Net income (loss) $ 2,498 $ (486) $ (3,047) $ (1,035) For the three months ended March 31, 2022 Sales, net $ 45,417 $ - $ - $ 45,417 Total mine cost of sales, including depreciation 26,094 - - 26,094 Exploration expense 1,237 1,068 - 2,305 Total other costs and expenses, including G&A 4,692 317 2,639 7,648 Provision for income taxes 5,351 - - 5,351 Net income (loss) $ 8,043 $ (1,385) $ (2,639) $ 4,019 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Realized gain - embedded derivative, net | $ 634 | $ 866 |
Unrealized (loss) gain - embedded derivative, net | (721) | 1,168 |
Total sales, net | 31,228 | 45,417 |
Dore | ||
Disaggregation of Revenue [Line Items] | ||
Less: Treatment and refining charges | (25) | (7) |
Total concentrate sales, net | 1,769 | 1,257 |
Gold Dore | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 1,725 | 1,244 |
Silver Dore | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 69 | 20 |
Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Less: Treatment and refining charges | (3,159) | (2,741) |
Total concentrate sales, net | 29,546 | 42,126 |
Gold Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 10,622 | 14,541 |
Silver Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 6,573 | 6,085 |
Copper Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 2,994 | 4,097 |
Lead Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 2,965 | 3,827 |
Zinc Concentrate | ||
Disaggregation of Revenue [Line Items] | ||
Total concentrate sales, net | 9,551 | 16,317 |
Co-products | ||
Disaggregation of Revenue [Line Items] | ||
Realized gain - embedded derivative, net | $ 400 | $ 500 |
Inventories, net (Details)
Inventories, net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Stockpiles - underground mine | $ 171 | $ 597 |
Concentrates | 2,035 | 3,271 |
Dore, net | 382 | 653 |
Subtotal - product inventories | 2,588 | 4,521 |
Materials and supplies | 8,591 | 8,979 |
Total | 11,179 | 13,500 |
Materials and supplies | ||
Inventory reserve | $ 100 | $ 100 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Taxes [Line Items] | ||
Effective tax rate | 21% | |
Withholding tax on dividends | 10% | |
Dividend withholding tax between countries | 5% | |
Income tax expense | $ (134,000) | $ 5,351,000 |
Liability for uncertain tax positions | $ 0 | |
CANADA | ||
Income Taxes [Line Items] | ||
Canada income tax rate | 26.50% | |
Mexico | ||
Income Taxes [Line Items] | ||
Withholding tax on dividends | 5% | |
MITL corporate income tax rate | 30% | 37.50% |
MITL royalty tax on mining concessions | 7.50% | |
Royalty fee as percent of gross revenue | 0.50% | |
Liability for uncertain tax positions | $ 600,000 | |
Amortization period | 10 years | |
Amortization rate | 10% | |
MITL corporate income tax rate excluding mining tax | 30% | |
Mining tax rate | 7.50% |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Prepaid Expenses And Other Current Assets | ||
Advances to suppliers | $ 711 | $ 867 |
Prepaid insurance | 538 | 1,298 |
Prepaid income tax | 1,256 | 432 |
Other current assets | 478 | 1,242 |
Total | $ 2,983 | $ 3,839 |
Property, Plant and Mine Deve_3
Property, Plant and Mine Development, net - Summary of Property, Equipment and Mine Development (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | |
Property, equipment and mine development - net | |||
Property and equipment, gross | [1] | $ 287,318 | $ 284,510 |
Accumulated depreciation and amortization | (138,321) | (131,947) | |
Total property, equipment and mine development - net | 148,997 | 152,563 | |
Accrued capital expenditures | 300 | 1,300 | |
Asset retirement costs | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 7,449 | 7,449 | |
Construction-In-Progress | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 250 | 351 | |
Furniture and office equipment | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 1,776 | 1,732 | |
Land | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 9,033 | 9,033 | |
Mineral interests | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 79,543 | 79,543 | |
Light Vehicles And Other Mobile Equipment | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 2,144 | 2,327 | |
Machinery And Equipment | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 41,729 | 41,343 | |
Mill facilities and infrastructure | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 35,924 | 35,917 | |
Mine Development | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | 107,916 | 105,263 | |
Software and licenses | |||
Property, equipment and mine development - net | |||
Property and equipment, gross | $ 1,554 | $ 1,552 | |
[1] Includes accrued capital expenditures of $0.3 million and $1.3 million at March 31, 2023 and December 31, 2022, respectively. |
Property, Plant and Mine Deve_4
Property, Plant and Mine Development, net - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property, Plant and Mine Development, net | ||
Depreciation and amortization expense | $ 7,300 | $ 6,000 |
Liability for Aquila drillhole capping | $ 514 |
Other Non-current Assets (Detai
Other Non-current Assets (Details) $ in Thousands, $ in Millions | Mar. 31, 2023 USD ($) | Mar. 31, 2023 CAD ($) | Dec. 31, 2022 USD ($) |
Other Non-current Assets | |||
Other non-current assets | $ 310 | $ 339 | |
Total | 5,488 | 5,509 | |
Maritime Resources Corp | |||
Other Non-current Assets | |||
Equity Investment | 1,561 | 1,559 | |
Green Light Metals | |||
Other Non-current Assets | |||
Equity Investment | $ 3,600 | $ 4.9 | $ 3,611 |
Other Non-current Assets - Narr
Other Non-current Assets - Narrative (Details) $ / shares in Units, $ in Thousands, $ in Millions | 3 Months Ended | ||||||||
Dec. 28, 2022 shares | Sep. 22, 2022 USD ($) shares | Mar. 31, 2023 USD ($) $ / shares | Mar. 31, 2023 CAD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 $ / shares | Sep. 22, 2022 CAD ($) shares | Oct. 31, 2021 USD ($) | Oct. 31, 2021 CAD ($) | |
Green Light Metals | |||||||||
Other Non-current Assets | |||||||||
Per share for the common shares that were to be issued at maturity | $ / shares | $ 0.40 | ||||||||
Number of shares received in conversion of promissory note | shares | 12,250,000 | ||||||||
Green Light Metals | Aquila Resources Inc. | |||||||||
Other Non-current Assets | |||||||||
Promissory notes receivable | $ 3,900 | $ 4.9 | |||||||
Maritime Resources Corp | |||||||||
Other Non-current Assets | |||||||||
Investment amount | $ 1,700 | $ 2.4 | |||||||
Number of shares purchased or received | shares | 47,000,000 | 47,000,000 | |||||||
Percentage of investment on issued and outstanding capital | 9.90% | ||||||||
Equity Investment | $ | $ 1,561 | $ 1,559 | |||||||
Green Light Metals | |||||||||
Other Non-current Assets | |||||||||
Equity Investment | $ 3,600 | $ 4.9 | $ 3,611 | ||||||
Ownership percentage | 28.50% | 28% | 28% | ||||||
Maximum per share amount for additional shares being issued. | $ / shares | $ 0.40 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accrued Expenses | ||
Accrued royalty payments | $ 1,402 | $ 1,787 |
IVA taxes payable, net | 274 | |
Share-based compensation liability | 168 | |
Liability for Aquila drillhole capping | 110 | |
Employee profit sharing obligation | 2,350 | 2,206 |
Other payables | 754 | 1,204 |
Total accrued expenses and other current liabilities | 5,058 | 5,197 |
Other Liabilities, Noncurrent [Abstract] | ||
Accrued non-current labor obligation | 1,145 | 1,050 |
Share-based compensation liability | 1,040 | 884 |
Other long-term liabilities | 120 | 556 |
Total other non-current liabilities | $ 2,305 | $ 2,490 |
Gold and Silver Stream Agreem_3
Gold and Silver Stream Agreements - Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Deferred revenue | $ 43,740 | $ 43,466 |
Gold Streaming Agreement | ||
Deferred revenue | 20,938 | 20,881 |
Silver Streaming Agreement | ||
Deferred revenue | $ 22,802 | $ 22,585 |
Gold and Silver Stream Agreem_4
Gold and Silver Stream Agreements - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jun. 30, 2020 | Mar. 31, 2023 | Dec. 31, 2022 | Nov. 30, 2017 | |
Discount rate (as a percent) | 8% | 8% | ||
Deferred revenue | $ 43,740,000 | $ 43,466,000 | ||
Gold Streaming Agreement | ||||
Deferred revenue | 20,938,000 | 20,881,000 | ||
Gold Streaming Agreement | Aquila Resources Inc. | Gold. | ||||
Amount committed | $ 50,000,000 | $ 55,000,000 | ||
Cash acquisition costs | 20,000,000 | |||
Deposit amount | 5,000,000 | |||
Project debt finance first draw down | $ 25,000,000 | |||
Initial term of agreement | 40 years | |||
Automatic renewal term of agreement | 10 years | |||
Deferred revenue | 20,000,000 | |||
Deposit liability | 30,000,000 | |||
Threshold stream (as a percent) | 18.50% | |||
Trail stream (as a percent) | 9.25% | |||
Spot price of gold (as a percent) | 30% | |||
Maximum amount receivable on gold per ounce | $ 600 | |||
Threshold price of silver at which deposit received is adjusted | 105,000 | |||
Gold Streaming Agreement | Aquila Resources Inc. | Silver | ||||
Deferred revenue | 17,200,000 | |||
Threshold price of silver at which deposit received is adjusted | $ 4 | |||
Gold Streaming Agreement | Gold Resources Acquisition Company | Aquila Resources Inc. | Gold. | ||||
Ownership percentage | 100% | |||
Silver Streaming Agreement | ||||
Deferred revenue | 22,802,000 | $ 22,585,000 | ||
Silver Streaming Agreement | Aquila Resources Inc. | Silver | ||||
Cash acquisition costs | 17,200,000 | |||
Deposit amount | $ 0 | |||
Initial term of agreement | 40 years | |||
Automatic renewal term of agreement | 10 years | |||
Commodity produced (as a percent) | 85% | 85% |
Reclamation and Remediation - O
Reclamation and Remediation - Obligations (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Reclamation and Remediation | ||
Current reclamation and remediation liabilities | $ 110 | |
Reclamation and remediation liabilities | 11,669 | $ 10,366 |
Total | $ 11,779 | $ 10,366 |
Reclamation and Remediation - C
Reclamation and Remediation - Changes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Asset Retirement Obligation, Roll Forward Analysis | ||
Reclamation liabilities - balance at beginning of period | $ 1,949 | $ 1,833 |
Foreign currency exchange loss (gain) | 135 | 116 |
Reclamation liabilities - balance at end of period | 2,084 | 1,949 |
Asset retirement obligation - balance at beginning of period | 8,417 | 1,279 |
Changes in estimate | 6,384 | |
Liability for Aquila drillhole capping | 514 | |
Accretion | 173 | 668 |
Foreign currency exchange loss (gain) | 591 | 86 |
Asset retirement obligation - balance at end of period | 9,695 | 8,417 |
Total | $ 11,779 | $ 10,366 |
Reclamation and Remediation - N
Reclamation and Remediation - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 31, 2023 | Dec. 31, 2021 | |
Undiscounted reclamation liabilities | $ 1,949 | $ 2,084 | $ 1,833 |
Reclamation and remediation discount rate | 8% | ||
Asset Retirement Obligation | 8,417 | $ 9,695 | $ 1,279 |
Increase in estimated liability | 6,400 | ||
Don David Gold Mine | |||
Undiscounted reclamation liabilities | 1,900 | 2,100 | |
Asset Retirement Obligation | $ 8,400 | $ 9,700 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) $ in Thousands, $ in Millions | 3 Months Ended | ||||
Dec. 30, 2013 CAD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2023 CAD ($) | Dec. 31, 2022 USD ($) | Dec. 10, 2021 USD ($) | |
Leases [Line Items] | |||||
Equipment purchase commitments | $ 1,000 | $ 1,200 | |||
Contingent consideration | 2,144 | 2,179 | |||
Contingent consideration, current | 2,215 | $ 2,211 | |||
HudBay Michigan Inc | |||||
Leases [Line Items] | |||||
Percentage of voting equity interests acquired | 100% | ||||
Management payment | $ 2,200 | $ 3 | |||
Ownership interest purchase to be prevented | 51% | 51% | |||
Contingent consideration, current | $ 2,200 | ||||
HudBay Michigan Inc | Gold and silver streaming agreement with Osisko Bermuda Limited | Back Forty Project | |||||
Leases [Line Items] | |||||
Deposit amount | $ 37,200 | ||||
Aquila Resources Inc. | Back Forty Project | |||||
Leases [Line Items] | |||||
Percentage of ownership interest held | 100% | ||||
Contingent consideration | $ 9 | 4,400 | |||
Contingent consideration due upon project financing | $ 3 | ||||
Percentage of contingent consideration payable in shares | 50% | ||||
Contingent consideration payable in shares | $ 3 | ||||
Right to repurchase ownership interest | 51% | ||||
Contingent consideration | 2,200 | ||||
Contingent consideration, current | $ 2,200 | ||||
Aquila Resources Inc. | Back Forty Project | 90 days after the commencement of commercial production | |||||
Leases [Line Items] | |||||
Contingent consideration payable in cash | $ 2 | ||||
Aquila Resources Inc. | Back Forty Project | 270 days after the commencement of commercial production | |||||
Leases [Line Items] | |||||
Contingent consideration payable in cash | 2 | ||||
Aquila Resources Inc. | Back Forty Project | 450 days after the commencement of commercial production | |||||
Leases [Line Items] | |||||
Contingent consideration payable in cash | $ 2 | ||||
HudBay Michigan Inc | HudBay Michigan Inc | |||||
Leases [Line Items] | |||||
Percentage of net smelter return royalty on production | 1% | ||||
HudBay Michigan Inc | Back Forty Project | |||||
Leases [Line Items] | |||||
Percentage of voting equity interests acquired at the asset acquisition date tied to the development of project | 51% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | |
Shareholders' Equity | |||
Dividend per share declared and paid | $ 0.01 | ||
Dividends paid | $ 0.9 | ||
Common stock, shares outstanding | 88,468,542 | 88,398,109 |
Derivatives (Details)
Derivatives (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) $ / t $ / oz oz t | |
Embedded Derivative [Line Items] | |
Unsettled sales contracts value | $ 26,092 |
Gold | |
Embedded Derivative [Line Items] | |
Under contract | oz | 4,390 |
Average forward price | $ / oz | 1,885 |
Unsettled sales contracts value | $ 8,275 |
Silver. | |
Embedded Derivative [Line Items] | |
Under contract | oz | 256,430 |
Average forward price | $ / oz | 22.08 |
Unsettled sales contracts value | $ 5,662 |
Copper | |
Embedded Derivative [Line Items] | |
Under contract | t | 207 |
Average forward price | $ / t | 8,880 |
Unsettled sales contracts value | $ 1,838 |
Lead | |
Embedded Derivative [Line Items] | |
Under contract | t | 1,720 |
Average forward price | $ / t | 2,092 |
Unsettled sales contracts value | $ 3,598 |
Zinc | |
Embedded Derivative [Line Items] | |
Under contract | t | 2,183 |
Average forward price | $ / t | 3,078 |
Unsettled sales contracts value | $ 6,719 |
Employee Benefits (Details)
Employee Benefits (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Employee Benefits | |
Defined contribution plan maximum percentage amount of the employee's gross pay that the employee can contribute | 50% |
Percentage Of Statutory Profit Sharing Payable | 10% |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Additionally number of shares granted | 5,000,000 | ||
Options granted | 0 | 320,816 | |
Number of stock options exercised | 0 | 355,000 | |
Accrued Liabilities Current | $ 5,058,000 | $ 5,197,000 | |
Stock-based compensation expense | 597,000 | $ 774,000 | |
STIP | |||
Accrued Liabilities Current | $ 400,000 | ||
Restricted stock units | |||
Number of units Granted | 612,059 | 234,605 | |
Common shares issued | 70,433 | ||
Vested and redeemed | 195,525 | 0 | |
Total intrinsic value | $ 61,981 | ||
Stock-based compensation expense | $ 153,000 | $ 48,000 | |
Deferred | 106,955 | ||
Withheld taxes - Obligation | 18,137 | ||
Performance stock units | |||
Number of units Granted | 534,890 | 294,147 | |
Vesting period | 3 years | ||
Stock-based compensation expense | $ (33,000) | ||
Current Liability related to PSU | 200,000 | $ 0 | |
Non - Current liability related to PSU | $ 100,000 | $ 0 | |
Deferred stock units | |||
Vesting period | 10 years | ||
Number of units Granted in lieu of board fees | 13,649 | 3,356 | |
Deferred stock units liability | $ 400,000 | $ 600,000 | |
Number of units Granted | 278,663 | 214,357 | |
Stock-based compensation expense | $ 357,000 | $ 577,000 | |
Other non-current liability | $ 900,000 | $ 800,000 | |
Deferred stock units | Executive Officer | |||
Number of units Granted | 212,407 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based compensation expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock-based compensation expense | $ 597 | $ 774 |
Deferred stock units | ||
Stock-based compensation expense | 357 | 577 |
Restricted stock units | ||
Stock-based compensation expense | 153 | 48 |
Stock options | ||
Stock-based compensation expense | 120 | $ 149 |
Performance stock units | ||
Stock-based compensation expense | $ (33) |
Zinc Zero Cost Collar (Details)
Zinc Zero Cost Collar (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Realized (gain) loss on zinc zero cost collar | $ (634) | $ (866) |
Unrealized (gain) loss on zinc zero cost collar | 721 | (1,168) |
Total | 4,137 | |
Zinc | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Realized (gain) loss on zinc zero cost collar | (223) | (429) |
Unrealized (gain) loss on zinc zero cost collar | $ 300 | (588) |
Zero Cost Collar | Zinc | Not designated as hedge | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Realized (gain) loss on zinc zero cost collar | (1,628) | |
Unrealized (gain) loss on zinc zero cost collar | (2,509) | |
Total | $ (4,137) |
Other Expense, net (Details)
Other Expense, net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Other (Income) Expense, Net | ||
Unrealized currency exchange loss | $ 453 | $ 445 |
Realized currency exchange loss | 176 | 129 |
Realized and unrealized gain from gold and silver rounds, net | (9) | (36) |
Interest on streaming liabilities | 274 | 176 |
Severance | 610 | |
Other (income) expense | (35) | 124 |
Total | $ 1,469 | $ 838 |
Net Income per Common Share - N
Net Income per Common Share - Narrative (Details) - $ / shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net Income per Common Share | ||
Stock options excluded from computation of diluted weighted average share outstanding | 1.5 | 2.7 |
Shares excluded from weighted average shares outstanding, exercise price | $ 2.90 | $ 4.08 |
Net Income per Common Share - P
Net Income per Common Share - Potential Dilutive Stock Options On Weighted Average Shares Outstanding (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net Income per Common Share | ||
Net (loss) income | $ (1,035) | $ 4,019 |
Basic weighted average shares of common stock outstanding | 88,405,935 | 88,338,774 |
Dilutive effect of share-based awards | 278,094 | |
Diluted weighted average common shares outstanding | 88,405,935 | 88,616,868 |
Basic net income (loss) per common share: | ||
Basic net (loss) income per common share | $ (0.01) | $ 0.05 |
Diluted net income (loss) per common share: | ||
Diluted net (loss) income per common share | $ (0.01) | $ 0.05 |
Fair Value Measurement (Details
Fair Value Measurement (Details) $ / shares in Units, $ in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 28, 2022 shares | Sep. 22, 2022 USD ($) shares | Sep. 22, 2022 CAD ($) shares | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Mar. 31, 2023 CAD ($) $ / shares | Dec. 31, 2022 $ / shares | |
Green Light Metals [Member] | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Share price | $ / shares | $ 0.40 | ||||||
Green Light Metals [Member] | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Number of shares received in conversion of promissory note | shares | 12,250,000 | ||||||
Maritime Resources Corp | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Investment made | $ 1,700 | $ 2.4 | |||||
Number of equity securities purchased | shares | 47 | 47 | |||||
Realized and unrealized derivative (loss) gain, net | $ 0 | ||||||
Equity Investment | $ 1,561 | $ 1,559 | |||||
Share price | $ / shares | $ 0.045 | $ 0.045 | |||||
Green Light Metals [Member] | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Ownership percentage | 28.50% | 28% | 28% | ||||
Equity Investment | $ 3,600 | 3,611 | $ 4.9 | ||||
Maximum | Maritime Resources Corp | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Ownership percentage | 10% | 10% | |||||
Accounts Receivable | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Realized and unrealized derivative (loss) gain, net | (100) | 600 | |||||
Level 1 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and cash equivalents | 21,420 | 23,675 | |||||
Investment in equity securities | 1,561 | 1,559 | |||||
Level 2 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Accounts receivable, net | 5,134 | 5,085 | |||||
Level 3 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Investment in equity securities | $ 3,617 | $ 3,611 |
Fair Value Measurement - Statem
Fair Value Measurement - Statement Of Income Classification (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Fair Value Statement Of Income Classification [Line Items] | ||
Unrealized gain (loss) on zinc zero cost collar | $ (2,509) | |
Sales, net | ||
Fair Value Statement Of Income Classification [Line Items] | ||
Realized and unrealized derivative (loss) gain, net | $ (87) | 2,034 |
Other expenses, net | ||
Fair Value Statement Of Income Classification [Line Items] | ||
Realized gain (loss) on zinc zero cost collar | (1,628) | |
Unrealized gain (loss) on zinc zero cost collar | $ (2,509) |
Fair Value Measurement - Realiz
Fair Value Measurement - Realized Unrealized Derivatives, net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivatives, Fair Value [Line Items] | ||
Realized gain | $ 634 | $ 866 |
Unrealized gain (loss) | (721) | 1,168 |
Total realized/ unrealized derivatives, net | (87) | 2,034 |
Gold | ||
Derivatives, Fair Value [Line Items] | ||
Realized gain | 114 | 126 |
Unrealized gain (loss) | (37) | 242 |
Total realized/ unrealized derivatives, net | 77 | 368 |
Silver. | ||
Derivatives, Fair Value [Line Items] | ||
Realized gain | 149 | 249 |
Unrealized gain (loss) | (271) | 275 |
Total realized/ unrealized derivatives, net | (122) | 524 |
Copper | ||
Derivatives, Fair Value [Line Items] | ||
Realized gain | 54 | 43 |
Unrealized gain (loss) | (10) | 16 |
Total realized/ unrealized derivatives, net | 44 | 59 |
Lead | ||
Derivatives, Fair Value [Line Items] | ||
Realized gain | 94 | 19 |
Unrealized gain (loss) | (103) | 47 |
Total realized/ unrealized derivatives, net | (9) | 66 |
Zinc | ||
Derivatives, Fair Value [Line Items] | ||
Realized gain | 223 | 429 |
Unrealized gain (loss) | (300) | 588 |
Total realized/ unrealized derivatives, net | $ (77) | $ 1,017 |
Supplementary Cash Flow Infor_3
Supplementary Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Supplementary Cash Flow Information | ||
Unrealized loss (gain) on gold and silver rounds | $ (9) | $ (70) |
Unrealized foreign currency exchange loss | 453 | 445 |
Unrealized (gain) loss on zinc zero cost collar | 2,509 | |
Other | 187 | (333) |
Total other operating adjustments | $ 631 | $ 2,551 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Number of geographic regions | segment | 3 | |||
Balance sheet information | ||||
Total current assets | $ 40,716 | $ 46,099 | ||
Total non-current assets | 154,485 | 158,072 | ||
Total assets | 195,201 | 204,171 | ||
Total current liabilities | 16,633 | 24,682 | ||
Total non-current liabilities | 67,577 | 67,725 | ||
Total shareholders' equity | 110,991 | $ 123,715 | 111,764 | $ 120,750 |
Total liabilities and shareholders' equity | 195,201 | 204,171 | ||
Income statement information | ||||
Sales, net | 31,228 | 45,417 | ||
Total mine cost of sales, including depreciation | 27,299 | 26,094 | ||
Exploration expenses | 1,839 | 2,305 | ||
Total other costs and expenses, including G&A | 3,259 | 7,648 | ||
Provision for income taxes | (134) | 5,351 | ||
Net income (loss) | (1,035) | 4,019 | ||
Oaxaca, Mexico | ||||
Income statement information | ||||
Exploration expenses | 1,389 | 1,237 | ||
Michigan, USA | ||||
Income statement information | ||||
Exploration expenses | 450 | 1,068 | ||
Operating Segments | Oaxaca, Mexico | ||||
Balance sheet information | ||||
Total current assets | 35,626 | 38,032 | ||
Total non-current assets | 59,759 | 63,342 | ||
Total assets | 95,385 | 101,374 | ||
Total current liabilities | 12,904 | 20,035 | ||
Total non-current liabilities | 5,142 | 5,533 | ||
Total shareholders' equity | 77,339 | 75,806 | ||
Total liabilities and shareholders' equity | 95,385 | 101,374 | ||
Income statement information | ||||
Sales, net | 31,228 | 45,417 | ||
Total mine cost of sales, including depreciation | 26,660 | 26,094 | ||
Exploration expenses | 1,389 | 1,237 | ||
Total other costs and expenses, including G&A | 631 | 4,692 | ||
Provision for income taxes | 50 | 5,351 | ||
Net income (loss) | 2,498 | 8,043 | ||
Operating Segments | Michigan, USA | ||||
Balance sheet information | ||||
Total current assets | 144 | 272 | ||
Total non-current assets | 92,908 | 92,927 | ||
Total assets | 93,052 | 93,199 | ||
Total current liabilities | 2,649 | 3,352 | ||
Total non-current liabilities | 60,717 | 60,648 | ||
Total shareholders' equity | 29,686 | 29,199 | ||
Total liabilities and shareholders' equity | 93,052 | 93,199 | ||
Income statement information | ||||
Total mine cost of sales, including depreciation | 14 | |||
Exploration expenses | 450 | 1,068 | ||
Total other costs and expenses, including G&A | 244 | 317 | ||
Provision for income taxes | (222) | |||
Net income (loss) | (486) | (1,385) | ||
Corporate and Other | ||||
Balance sheet information | ||||
Total current assets | 4,946 | 7,795 | ||
Total non-current assets | 1,818 | 1,803 | ||
Total assets | 6,764 | 9,598 | ||
Total current liabilities | 1,080 | 1,295 | ||
Total non-current liabilities | 1,718 | 1,544 | ||
Total shareholders' equity | 3,966 | 6,759 | ||
Total liabilities and shareholders' equity | 6,764 | $ 9,598 | ||
Income statement information | ||||
Total mine cost of sales, including depreciation | 625 | |||
Total other costs and expenses, including G&A | 2,384 | 2,639 | ||
Provision for income taxes | 38 | |||
Net income (loss) | $ (3,047) | $ (2,639) |