Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 02, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | McEwen Mining Inc. | |
Entity Central Index Key | 314,203 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 277,044,650 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
REVENUE: | ||
Gold and silver sales | $ 21,190 | $ 22,882 |
Total Revenue | 21,190 | 22,882 |
COSTS AND EXPENSES: | ||
Production costs applicable to sales | 9,067 | 10,454 |
Mine development costs | 698 | 174 |
Exploration costs | 1,740 | 2,342 |
Property holding costs | 1,147 | 1,492 |
General and administrative | 2,768 | 3,208 |
Depreciation | 239 | 272 |
Accretion of asset retirement obligation (note 4) | 124 | 101 |
Loss (Income) from investment in Minera Santa Cruz S.A., net of amortization (note 5) | (4,963) | (329) |
Total costs and expenses | 10,820 | 17,714 |
Operating income (loss) | 10,370 | 5,168 |
OTHER INCOME (EXPENSE): | ||
Interest (expense) and other (expense) income | 228 | (98) |
Foreign currency gain | 783 | (212) |
Total other (expense) income | 748 | (310) |
Gain on sale of marketable equity securities (note 2) | 22 | |
Other-than-temporary impairment on marketable equity securities (note 2) | (285) | |
Gain (loss) before income taxes | 11,118 | 4,858 |
Income taxes recovery (note 9) | 1,867 | 1,163 |
Net income (loss) | 12,985 | 6,021 |
OTHER COMPREHENSIVE LOSS | ||
Unrealized (loss) gain on available-for-sale securities, net of taxes | (124) | (165) |
Comprehensive income (loss) | $ 12,861 | $ 5,856 |
Net income (loss) per share (note 10): | ||
Basic (in dollars per share) | $ 0.04 | $ 0.02 |
Diluted (in dollars per share) | $ 0.04 | $ 0.02 |
Weighted average common shares outstanding (thousands) (note 10): | ||
Basic (in shares) | 298,242 | 297,255 |
Diluted (in shares) | 298,554 | 297,266 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 34,623 | $ 25,874 |
Investments (note 2) | 460 | 1,032 |
Value added taxes receivable | 4,126 | 10,032 |
Inventories (note 3) | 15,769 | 14,975 |
Other current assets | 1,994 | 2,530 |
Total current assets | 56,972 | 54,443 |
Mineral property interests (note 4) | 237,373 | 237,245 |
Investment in Minera Santa Cruz S.A. (note 5) | 169,444 | 167,107 |
Property and equipment, net | 15,664 | 15,759 |
Other assets (note 14) | 537 | 531 |
TOTAL ASSETS | 479,990 | 475,085 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 17,072 | 18,429 |
Short-term bank indebtedness (note 6) | 3,395 | |
Current portion of asset retirement obligation (note 4) | 215 | 215 |
Total current liabilities | 17,287 | 22,039 |
Asset retirement obligation, less current portion (note 4) | 7,693 | 7,569 |
Deferred income tax liability (note 9) | 25,014 | 26,899 |
Deferred rent expense | 278 | 286 |
Total liabilities | 50,272 | 56,793 |
Shareholders' equity: | ||
Common stock, no par value, 500,000 shares authorized; Common: 274,254 as of September 30, 2015 and 271,579 as of December 31, 2014 issued and outstanding; Exchangeable: 26,277 shares as of September 30, 2015 and 28,521 shares as of December 31, 2014 issued and outstanding | 1,357,424 | 1,359,144 |
Accumulated deficit | (927,042) | (940,027) |
Accumulated other comprehensive (loss) income | (664) | (825) |
Total shareholders' equity | 429,718 | 418,292 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 479,990 | $ 475,085 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 500,000 | 500,000 |
Common, shares issued | 277,022 | 274,421 |
Common, shares outstanding | 277,022 | 274,421 |
Exchangeable, shares issued | 21,054 | 24,213 |
Exchangeable, shares outstanding | 21,054 | 24,213 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit | Total |
Balance at Dec. 31, 2014 | $ 1,360,668 | $ 124 | $ (919,577) | $ 441,215 |
Balance (in shares) at Dec. 31, 2014 | 300,100,000 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Stock-based compensation | $ 409 | 409 | ||
Shares issued for the settlement of accounts payable | $ 443 | 443 | ||
Shares issued for settlement of accounts payable (in shares) | 430,000 | |||
Unrealized gain (loss) on available-for-sale securities, net of taxes | (165) | (165) | ||
Net loss | 6,021 | 6,021 | ||
Balance at Mar. 31, 2015 | $ 1,361,520 | (41) | (913,556) | 447,923 |
Balance (in shares) at Mar. 31, 2015 | 300,530,000 | |||
Balance at Dec. 31, 2014 | $ 1,360,668 | 124 | (919,577) | 441,215 |
Balance (in shares) at Dec. 31, 2014 | 300,100,000 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Share repurchase (note 7) | $ (1,800) | |||
Share repurchase (note 7) (in shares) | (1,896,442) | |||
Balance at Dec. 31, 2015 | $ 1,359,144 | (825) | (940,027) | $ 418,292 |
Balance (in shares) at Dec. 31, 2015 | 298,634,000 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Stock-based compensation | $ 353 | 353 | ||
Return of capital distribution (note 7) | (1,491) | (1,491) | ||
Unrealized gain (loss) on available-for-sale securities, net of taxes | (124) | (124) | ||
Share repurchase (note 7) | $ (582) | $ (582) | ||
Share repurchase (note 7) (in shares) | (558,000) | (557,991) | ||
Other-than-temporary impairment on marketable equity securities (note 2) | 285 | $ 285 | ||
Net loss | 12,985 | 12,985 | ||
Balance at Mar. 31, 2016 | $ 1,357,424 | $ (664) | $ (927,042) | $ 429,718 |
Balance (in shares) at Mar. 31, 2016 | 298,076,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Cash paid to suppliers and employees | $ 8,457 | $ 16,468 |
Cash received from gold and silver sales | 20,319 | 21,985 |
Dividends received from Minera Santa Cruz S.A. | 2,626 | |
Interest received | 220 | 98 |
Cash provided by (used in) operating activities | 14,708 | 5,615 |
Cash flows from investing activities: | ||
Acquisition of mineral property interests | (450) | |
Additions to property and equipment | (145) | (192) |
Investment in marketable equity securities | (1,114) | |
Cash (used in) provided by investing activities | (595) | (1,306) |
Cash flows from financing activities: | ||
Short-term bank indebtedness (note 6) | (3,395) | |
Return of capital distribution paid (note 7) | (1,489) | |
Share repurchase (note 7) | (582) | |
Cash provided by financing activities | (5,466) | |
Effect of exchange rate change on cash and cash equivalents | 102 | (120) |
Increase (decrease) in cash and cash equivalents | 8,749 | 4,189 |
Cash and cash equivalents, beginning of period | 25,874 | 12,380 |
Cash and cash equivalents, end of period | 34,623 | 16,569 |
Reconciliation of net loss to cash provided by (used in) operating activities: | ||
Net loss | 12,985 | 6,021 |
Adjustments to reconcile net loss to from operating activities: | ||
Loss (Income) from investment in Minera Santa Cruz S.A., net of amortization | (4,963) | (329) |
Other-than-temporary impairment on marketable equity securities (note 2) | 285 | |
Recovery of deferred income taxes | (1,867) | (1,163) |
Stock-based compensation | 353 | 409 |
Depreciation | 239 | 272 |
Accretion of asset retirement obligation | 124 | 101 |
Amortization of mineral property interests and asset retirement obligations | 322 | 322 |
Foreign exchange loss | (102) | 120 |
Gain on sale of marketable securities | (22) | |
Change in non-cash working capital items: | ||
Increase in VAT taxes receivable, net of collection of $4,256 (2014 - $5,049) | 5,905 | 1,334 |
Increase (decrease) in other assets related to operations | 206 | (129) |
(Decrease) increase in liabilities related to operations | (1,383) | (1,343) |
Dividends received from Minera Santa Cruz S.A. | 2,626 | |
Cash provided by (used in) operating activities | $ 14,708 | $ 5,615 |
CONSOLIDATED STATEMENTS OF CAS7
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
Collection of VAT taxes receivable | $ 6,771 | $ 2,746 |
NATURE OF OPERATIONS AND SUMMAR
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2016 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations and Basis of Presentation McEwen Mining Inc. (the “Company” or “McEwen Mining”) was organized under the laws of the State of Colorado on July 24, 1979. Since inception, the Company has been engaged in the exploration for, development of, production and sale of gold and silver. The Company operates in Mexico, Argentina, and the United States. It owns and operates the producing El Gallo 1 Mine in Sinaloa, Mexico. It also owns a 49% interest in Minera Santa Cruz S.A. (“MSC”), owner and operator of the producing San José Mine in Santa Cruz, Argentina, which is controlled by the majority owner of the joint venture, Hochschild Mining plc (‘‘Hochschild’’). In addition to its operating properties, the Company holds interests in numerous exploration stage properties and projects in Mexico, Argentina and the United States. The interim consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included are adequate to make the information presented not misleading. In management’s opinion, the unaudited Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2016 and 2015 , the Consolidated Balance Sheets as at March 31, 2016 (unaudited) and December 31, 2015, the unaudited Consolidated Statement of Changes in Shareholders’ Equity for the three months ended March 31, 2016 and 2015, and the unaudited Consolidated Statements of Cash Flows for the three months ended March 31, 2016 and 2015, contained herein, reflect all adjustments, consisting solely of normal recurring items, which are necessary for the fair presentation of the Company’s financial position, results of operations and cash flows on a basis consistent with that of the Company’s prior audited consolidated financial statements. However, the results of operations for the interim periods may not be indicative of results to be expected for the full fiscal year. Therefore, these financial statements should be read in conjunction with the audited financial statements and notes thereto and summary of significant accounting policies included in the Company’s annual report on Form 10-K for the year ended December 31, 2015. Except as noted below, there have been no material changes in the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s Form 10-K for the year ended December 31, 2015. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. Recently Adopted Accounting Pronouncements Business Combinations – Simplifying the Accounting for Measurement Period Adjustments : In September 2015, the FASB issued amended guidance which requires measurement period adjustments to be recorded in the reporting period in which the adjustment amounts are determined. Previously, such adjustments were required to be retrospectively recorded in prior period financial information. This amended guidance is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date, with earlier application permitted for financial statements that have not been issued. The Company adopted this new guidance as of March 31, 2016, and as a result there was no impact on the Company’s consolidated financial statements. Revenue from Contracts with Customers – Deferral of the Effective Date: In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2015-09. ASU 2015-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The effective date of this pronouncement is for fiscal years beginning after December 15, 2017. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company adopted this new guidance as of March 31, 2016, and as a result there was no impact on the Company’s consolidated financial statements. Interest – Imputation of Interest – Simplifying the Presentation of Debt Issuance Costs: In April 2015, the FASB issued ASU 2015-03 which requires entities to present debt issuance costs related to a debt liability as a direct deduction from the carrying amount of that debt liability on the balance sheet as opposed to being presented as a deferred charge. ASU 2015-03 does not contain guidance for debt issuance costs related to line-of-credit arrangements. Consequently, in August 2015, the FASB issued ASU 2015-15 to add paragraphs indicating that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to line-of-credit arrangements as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The effective date of these pronouncements is for fiscal years beginning after December 15, 2015, with early adoption permitted. The Company adopted this new guidance as of March 31, 2016, and as a result there was no impact on the Company’s consolidated financial statements. Recently Issued Accounting Pronouncements Compensation – Stock Compensation – Improvements to employee Share-Based Payment Accounting: In March 2016, the FASB Issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The updated guidance changes how companies account for certain aspects of share-based payment awards to employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The update to the standard is effective for the Company beginning June 1, 2017, with early application permitted. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements. Investments - Equity Method and Joint Ventures - Simplifying the Transition to the Equity Method of Accounting: In March 2016 the FASB issued ASU 2016-07, “Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting”. The amendments affect all entities that have an investment that becomes qualified for the equity method of accounting as a result of an increase in the level of ownership interest or degree of influence. The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required. The amendments require that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. The Company is currently evaluating the potential impact this guidance will have on its consolidated financial statements. Financial Instruments — Overall (Subtopic 825-10) - Recognition and Measurement of Financial Assets and Financial Liabilities: In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10) – Recognition and Measurement of Financial Assets and Financial Liabilities”, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for the Company beginning in its first quarter of 2019. The Company is currently evaluating the potential impact this guidance will have on its consolidated financial statements. |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2016 | |
INVESTMENTS | |
INVESTMENTS | NOTE 2 INVESTMENTS The investment portfolio of the Company consists of marketable equity securities of certain publicly traded companies, which are classified as available-for-sale securities and are recorded at fair value based upon quoted market prices. As of March 31, 2016, the total cost of all marketable equity securities was $1.4 million (December 31, 2015 - $1.9 million). During the three months ended March 31, 2016, the Company sold marketable equity securities for proceeds of $0.4 million and realized a gain of $0.1 million. In addition, as at March 31, 2016, the Company reviewed its investment portfolio to determine if any security is other-than-temporarily impaired, which would require the Company to record an impairment charge in the income statement in the period any such determination is made. In making this judgment, the Company evaluated, among other things, the duration and extent to which the fair value of a security is less than its cost; the financial condition of the issuer and any changes thereto; and the Company’s intent to sell, or whether it will more likely than not be required to sell, the security before recovery of its amortized cost basis. From this assessment the Company concluded that the fair value of its portfolio of securities was $ 0.5 million. The Company also concluded that the fair value of certain marketable equity securities exhibited a prolonged decline in share price due to deterioration of the issuer’s results; therefore the decline in these marketable equity securities was considered other-than-temporarily impaired. Accordingly, the Company recognized an other-than-temporary impairment loss of $0.3 million on the Consolidated Statement of Operations and Comprehensive Income, for the three month period ended March 31, 2016. For the remaining marketable equity securities, the Company recorded a loss, net of tax, of $0.7 million in other comprehensive income, since it was concluded they were not other-than-temporarily impaired as of March 31, 2016. The loss was recorded in accumulated other comprehensive income and is reported as a separate line item in the shareholders' equity section of the balance sheet. The gains and losses for available-for-sale securities are not reported on the statement of operations until the securities are sold or if there is an other-than-temporary decline in fair value below cost. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2016 | |
INVENTORIES | |
INVENTORIES | NOTE 3 INVENTORIES Inventories at March 31, 2016 and December 31, 2015 consist of the following: March 31, 2016 December 31, 2015 Ore on leach pads $ $ In-process inventory Stockpiles Precious metals Materials and supplies Inventories $ $ |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 3 Months Ended |
Mar. 31, 2016 | |
MINERAL PROPERTY INTERESTS AND ASSET RETIREMENT OBLIGATIONS | |
MINERAL PROPERTY INTERESTS AND ASSET RETIREMENT OBLIGATIONS | NOTE 4 ASSET RETIREMENT OBLIGATIONS Asset Retirement Obligations The Company is responsible for reclamation of certain past and future disturbances at its properties. The two most significant properties subject to these obligations are the Tonkin property in Nevada and the El Gallo 1 Mine in Mexico. A reconciliation of the Company’s asset retirement obligations for the three months ended March 31, 2016 and for the year ended December 31, 2015 are as follows: Three months ended March 31, 2016 Year ended December 31, 2015 Asset retirement obligation liability, beginning balance $ $ Accretion of liability Adjustment reflecting updated estimates — Asset retirement obligation liability, ending balance $ $ As at March 31, 2016, the current portion of the asset retirement obligation was $0. 2 million (December 31, 2015 - $0. 2 million). Amortization of Mineral Property Interests and Asset Retirement Costs The definition of proven and probable reserves is set forth in the SEC Industry Guide 7. If proven and probable reserves exist at the Company’s properties, the relevant capitalized mineral property interests and asset retirement costs are charged to expense based on the units of production method and upon commencement of production. Since the Company has not completed feasibility or other studies sufficient to characterize the mineralized material at the El Gallo 1 Mine as proven or probable reserves, the amortization of the capitalized mineral property interests and asset retirement costs are charged to expense based on the straight-line method over the estimated useful life of the mine. For the three months ended March 31, 2016, the Company recorded $0.3 million (March 31, 2015, $0.3 million), of amortization expense related to the El Gallo 1 Mine, which is included in Production Costs Applicable to Sales in the Consolidated Statement of Operations and Comprehensive Income, of which $0.1 million, related to the amortization of capitalized asset retirement costs (March 31, 2015 - $0.1 million ). |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE | 3 Months Ended |
Mar. 31, 2016 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE | NOTE 5 INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) – SAN JOSÉ MINE The Company’s 49% attributable share of results of operations from its investment in MSC was income of $5.0 million for the three months ended March 31, 2016 ( March 31, 2015 - $0.3 million). These amounts include the amortization of the fair value increments arising from the purchase price allocation and related income tax recovery. Included in the income tax recovery is the impact of fluctuations in the exchange rate between the Argentine peso and the U.S. dollar on the peso-denominated deferred tax liability associated with the investment in MSC recorded as part of the acquisition of Minera Andes. As a devaluation of the Argentine peso relative to the U.S. dollar results in a recovery of deferred income taxes, the impact has been an increase in the income from the Company’s investment in MSC for the three months ended March 31, 2016. During the three months ended March 31, 2016, the Company received $2.6 million in dividends from MSC, compared to $nil during the same period in 2015. Changes in the Company’s investment in MSC for the three months ended March 31, 2016 and year ended December 31, 2015 are as follows: Three months ended March 31, 2016 Year ended December 31, 2015 Investment in MSC, beginning of the period $ $ Attributable net income (loss) from MSC Amortization of fair value increments Income tax recovery Dividend distribution received Impairment of investment in MSC — Investment in MSC, end of the period $ $ A summary of the operating results from MSC for the three months ended March 31, 2016 and 2015 is as follows: Three months ended March 31, 2016 2015 Minera Santa Cruz S.A. (100%) Net Sales $ $ Production costs applicable to sales Net income Portion attributable to McEwen Mining Inc. (49%) Net income $ $ Amortization of fair value increments Income tax recovery Income from investment in MSC, net of amortization $ $ As of March 31, 2016, MSC had current assets of $94.0 million, total assets of $480.5 million, current liabilities of $36.3 million and total liabilities of $134.8 million on an unaudited basis. These balances include the adjustments to fair value and amortization of the fair value increments arising from the purchase price allocation, net of impairment charges recorded in the fourth quarter of 2015. Excluding the fair value increments from the purchase price allocation, net of impairment charges, MSC had current assets of $93.0 million, total assets of $284.2 million, current liabilities of $47.1 million, and total liabilities of $83.7 million as at March 31, 2016. |
SHORT-TERM BANK INDEBTEDNESS
SHORT-TERM BANK INDEBTEDNESS | 3 Months Ended |
Mar. 31, 2016 | |
SHORT-TERM BANK INDEBTEDNESS | |
SHORT-TERM BANK INDEBTEDNESS | NOTE 6 SHORT-TERM BANK INDEBTEDNESS On May 29, 2015, Compañía Minera Pangea (“CMP”), a wholly-owned subsidiary of the Company, finalized a line of credit agreement with Banco Nacional de Comercio Exterior (“Banco Nacional”), for an amount up to 90,000,000 Mexican pesos (approximately $5.9 million as of May 29, 2015), which was secured by CMP’s Value Added Tax (“VAT”) receivable balance. The applicable interest rate was equal to: (i) two and one-half percent ( 2.5% ) per annum plus (ii) the 91 day Interbank Equilibrium Interest Rate (“TIIE”) rate, as published by the Bank of Mexico, payable quarterly. Upon signing the agreement, CMP paid a 1% commission on the total value of the simple credit agreement to Banco Nacional. On June 1, 2015, CMP drew down the entire 90,000,000 Mexican pesos, equivalent to $5.2 million as of December 31, 2015 from the line of credit. During the year ended December 31, 2015, CMP collected 34,654,201 Mexican pesos (equivalent to $2.0 million as of December 31, 2015) of VAT receivable, from which 2,903,100 Mexican pesos were applied against the accrued interest and the remaining 31,751,101 Mexican pesos (approximately $1.8 million as of December 31, 2015) were applied against the principal. On January 13, 2016, CMP paid the remaining balance of the indebtedness in the amount of 58,248,899 Mexican Pesos (approximately $3.4 million as of March 31, 2016). Upon the final payment, the line of credit agreement was closed. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2016 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 7 SHAREHOLDERS’ EQUITY During the three months ended March 31, 2016, 3. 2 million exchangeable shares were converted into common stock (March 31, 2015 – 0.9 million). At March 31, 2016, total outstanding exchangeable shares not exchanged and not owned by the Company or its subsidiaries totaled 21.0 million (March 31, 2015 – 27.6 million). On June 18, 2015, the Board of Directors declared an annual return of capital distribution of $0.01 per share of common stock, payable semi-annually. The first semi-annual return of capital distribution payment of $0.005 was paid on August 17, 2015 for an aggregate total of $1.5 million. The second semi-annual return of capital distribution payment of $0.005 was paid on February 12, 2016, for an aggregate total of $1.5 million. Return of capital distribution is paid to shareholders of the Company’s shares of common stock and to holders of exchangeable shares. On October 1, 2015, the Board of Directors approved a share repurchase program authorizing the Company to purchase up to 15,000,000 shares of its common stock over a twelve month period, with an authorized maximum of $15.0 million to be spent on the repurchases. Under the program, purchases of common stock may be made from time-to-time in the open market, subject to compliance with applicable U.S. and Canadian laws. The timing and amounts of any purchase are based on market conditions and other factors including share price, regulatory requirements and capital availability. Further, the repurchase program may be suspended, discontinued or modified at any time, at the discretion of the Board of Directors. During the three months ended March 31, 2016 the Company had repurchased 557,991 shares of common stock (year-ended December 31, 2015 - 1,896,442) at a total cost of $0.6 million (December 31, 2015 - $1.8 million), all of which have been cancelled. During the three months ended March 31, 2015, the Company issued 430,295 shares of common stock under an agreement with one of its mining contractors to settle parts of its accounts payable for services rendered above a defined tonnage threshold. The fair value of the common stock at the time of issuance was $ 0.4 million. The agreement with this mining contractor expired and was renegotiated during 2015 and under the revised agreement, the Company can no longer make share payments and instead is required to pay in cash. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2016 | |
INCOME TAXES | |
INCOME TAXES | NOTE 8 INCOME TAXES The Company’s income tax expense differs from the amount computed by applying the U.S. federal and state statutory corporate income tax rate of 35% to income before taxes primarily as a result of valuation allowances being applied to losses, changes in the de ferred tax liability associated with mineral property interests acquired in the Minera Andes acquisition and changes due to impairment of mineral property interests. The deferred tax liability is impacted by fluctuations in the foreign exchange rate between the Argentine peso and U.S. dollar. For the three months ended March 31, 2016, the Company recorded an income tax recovery as a result of the Argentine peso devaluation of $1.9 million, compared to $1.2 million for the three months ended March 31, 2015. |
INCOME (LOSS) PER SHARE
INCOME (LOSS) PER SHARE | 3 Months Ended |
Mar. 31, 2016 | |
INCOME (LOSS) PER SHARE | |
INCOME (LOSS) PER SHARE | NOTE 9 INCOME PER SHARE Basic net income per share is computed by dividing the net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed similarly except that the weighted average number of common shares is increased to reflect all dilutive instruments. Below is a reconciliation of the basic and diluted weighted average number of common shares and exchangeable shares outstanding and the computations for basic and diluted net income per share for the three months ended March 31, 2016 and 2015: Three months ended March 31, (amounts in thousands, except net income per share) 2016 2015 Net income $ $ Weighted average common shares outstanding: Effect of employee stock-based awards Diluted shares outstanding: Net income per share: $ $ Diluted $ $ For the three months ended March 31, 2016, options to purchase 4.6 million shares of common stock outstanding at March 31, 2016 (March 31, 2015 – 5.0 million) at an average exercise price of $3.26 per share (March 31, 2015 – $3.32) were not included in the computation of diluted weighted average shares because the exercise price exceeded the average price of the Company’s common stock for the three months ended March 31, 2016. Other outstanding options to purchase 0.3 million shares of common stock were not included in the computation of diluted weighted average shares in the three months ended March 31, 2016 because their effect would have been anti-dilutive . |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 10 RELATED PARTY TRANSACTIONS For the three months ended March 31, 2016, the Company incurred and paid $20,482 (March 31, 2015 - $16,137) to an entity affiliated with the Company’s Chairman and Chief Executive Officer for the use of an aircraft. For the three months ended March 31, 2016, legal fees of $23,100 (March 31, 2015 – $nil) were incurred with REVlaw, a company owned by Ms. Carmen Diges, General Counsel of the Company, and an outstanding balance of $103,100 is included within accounts payable at March 31, 2016 (December 31, 2015 - $80,000) . The services of Ms. Diges as General Counsel are provided by REVlaw. These legal fees have been recorded at their exchange amount, being the amount agreed to by the parties. The Company agreed to share services with Lexam VG Gold Inc. (“Lexam”) including rent, personnel, office expenses and other administrative services. The Company’s Chairman and Chief Executive Officer is the Non-Executive Chairman of Lexam and holds a 27% ownership in Lexam. For the three months ended March 31, 2016 the Company reimbursed Lexam $23,177 for net shared services. During the comparable period in 2015, Lexam paid $4,312 to the Company. These transactions are in the normal course of business. |
SEGMENTED INFORMATION
SEGMENTED INFORMATION | 3 Months Ended |
Mar. 31, 2016 | |
SEGMENTED INFORMATION | |
SEGMENTED INFORMATION | NOTE 11 SEGMENTED INFORMATION McEwen Mining is a mining and minerals exploration, development and production company focused on precious metals in Argentina, Mexico and the United States. The Company identifies its reportable segments as those consolidated operations that are currently engaged in the exploration for and production of precious metals. Operations not actively engaged in the exploration for, or production of precious metals are aggregated at the corporate level for segment reporting purposes. The financial information relating to the Company’s operating segments as of, and for the three months ended March 31, 2016 and 2015 is as follows: Corporate & Argentina Mexico U.S. Other Total For the three months ended March 31, 2016 Gold and silver sales $ — $ $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs General and administrative expenses Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Operating income (loss) As at March 31, 2016 Investment in Minera Santa Cruz S.A. $ $ — $ — $ — $ Mineral property interests — Total assets Corporate & Argentina Mexico U.S. Other Total For the three months ended March 31, 2015 Gold and silver sales $ — $ $ — $ — $ Production costs applicable to sales — — — Mine development costs — — — Exploration costs General and administrative expenses Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Operating income (loss) As at March 31, 2015 Investment in Minera Santa Cruz S.A. $ $ — $ — $ — $ Mineral property interests — Total assets |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 3 Months Ended |
Mar. 31, 2016 | |
FAIR VALUE ACCOUNTING | |
FAIR VALUE ACCOUNTING | NOTE 12 FAIR VALUE ACCOUNTING 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 and 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). Assets and liabilities measured at fair value on a recurring basis The following table identifies the fair value of the Company’s financial assets and liabilities as reported in the Consolidated Balance Sheets at March 31, 2016 and December 31, 2015 by level within the fair value hierarchy. 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. Fair Value as at March 31, 2016 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — $ $ $ — $ — Fair Value as at December 31 2015 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — $ $ $ — $ — The Company's investments are marketable equity securities which are exchange traded, and which are valued using quoted market prices in active markets and are classified within Level 1 of the fair value hierarchy. The fair value of the investments is calculated as the quoted market price of the marketable equity security multiplied by the number of shares held by the Company . The fair value of other financial assets and liabilities approximate their carrying values due to their short-term nature and historically negligible credit losses. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES. | |
COMMITMENTS AND CONTINGENCIES | NOTE 13 COMMITMENTS AND CONTINGENCIES Surety Bonds As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations in the United States. These surety bonds are available for draw down by the Bureau of Land Management in the event the Company does not perform its reclamation obligations. When the specific reclamation requirements are met, the beneficiary of the surety bonds will cancel and/or return the instrument to the issuing entity. The Company believes it is in compliance with all applicable bonding obligations and will be able to satisfy future bonding requirements, through existing or alternative means, as they arise. As at March 31, 2016, there were $ 4.8 million of surety bonds outstanding (December 31, 2015 - $4.8 million ) . The annual financing fees are 1.5% of the value of the surety bonds, with a required initial deposit of 10% ( $0.5 million), which is included in Other Assets in the Consolidated Balance Sheet. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2016 | |
SUBSEQUENT EVENTS. | |
SUBSEQUENT EVENTS | NOTE 14 SUBSEQUENT EVENTS On April 19, 2016, the Company completed the acquisition of the tiered net smelter return royalty (the “Royalty”) on the El Gallo 1 Mine , previously requiring payment of 3.5% of gross revenue less allowable deductions. The purchase price consisted of a $5.25 million payment at closing and a conditional deferred payment of $1.0 million to be made on June 30, 2018, provided that the El Gallo 1 Mine is in operation at that time . The Royalty ceased accruing at the end of March 2016 . |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
INVENTORIES | |
Schedule of inventories | March 31, 2016 December 31, 2015 Ore on leach pads $ $ In-process inventory Stockpiles Precious metals Materials and supplies Inventories $ $ |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
MINERAL PROPERTY INTERESTS AND ASSET RETIREMENT OBLIGATIONS | |
Schedule of reconciliation of asset retirement obligations | Three months ended March 31, 2016 Year ended December 31, 2015 Asset retirement obligation liability, beginning balance $ $ Accretion of liability Adjustment reflecting updated estimates — Asset retirement obligation liability, ending balance $ $ |
INVESTMENT IN MINERA SANTA CR24
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE | |
Schedule of change in the entity's investment in MSC | Three months ended March 31, 2016 Year ended December 31, 2015 Investment in MSC, beginning of the period $ $ Attributable net income (loss) from MSC Amortization of fair value increments Income tax recovery Dividend distribution received Impairment of investment in MSC — Investment in MSC, end of the period $ $ |
Summary of MSC's financial information from operations | Three months ended March 31, 2016 2015 Minera Santa Cruz S.A. (100%) Net Sales $ $ Production costs applicable to sales Net income Portion attributable to McEwen Mining Inc. (49%) Net income $ $ Amortization of fair value increments Income tax recovery Income from investment in MSC, net of amortization $ $ |
INCOME (LOSS) PER SHARE (Tables
INCOME (LOSS) PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
INCOME (LOSS) PER SHARE | |
Schedule of reconciliation of the basic weighted average number of common shares and the computations for basic loss per share | Three months ended March 31, (amounts in thousands, except net income per share) 2016 2015 Net income $ $ Weighted average common shares outstanding: Effect of employee stock-based awards Diluted shares outstanding: Net income per share: $ $ Diluted $ $ |
SEGMENTED INFORMATION (Tables)
SEGMENTED INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
SEGMENTED INFORMATION | |
Schedule of the financial information relating to the Company's segments | Corporate & Argentina Mexico U.S. Other Total For the three months ended March 31, 2016 Gold and silver sales $ — $ $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs General and administrative expenses Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Operating income (loss) As at March 31, 2016 Investment in Minera Santa Cruz S.A. $ $ — $ — $ — $ Mineral property interests — Total assets Corporate & Argentina Mexico U.S. Other Total For the three months ended March 31, 2015 Gold and silver sales $ — $ $ — $ — $ Production costs applicable to sales — — — Mine development costs — — — Exploration costs General and administrative expenses Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Operating income (loss) As at March 31, 2015 Investment in Minera Santa Cruz S.A. $ $ — $ — $ — $ Mineral property interests — Total assets |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
FAIR VALUE ACCOUNTING | |
Schedule of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy | Fair Value as at March 31, 2016 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — $ $ $ — $ — Fair Value as at December 31 2015 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — $ $ $ — $ — |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
INVESTMENTS | ||
Sale of marketable securities | $ 400 | |
Gain on available-for-sale securities | 100 | |
Cost of purchase of marketable equity securities | 1,400 | $ 1,900 |
Fair value of securities | 500 | |
Other-than-temporary impairment on marketable equity securities (note 2) | 285 | |
Unrealized loss on available-for-sale securities | $ 700 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
INVENTORIES | ||
Ore on leach pads | $ 7,318 | $ 7,150 |
In-process inventory | 3,320 | 2,830 |
Stockpiles | 1,583 | 1,923 |
Precious metals | 2,192 | 1,820 |
Materials and supplies | 1,356 | 1,252 |
Inventories | $ 15,769 | $ 14,975 |
ASSET RETIREMENT OBLIGATIONS -
ASSET RETIREMENT OBLIGATIONS - Mineral Property Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Mineral Property Interests | |||
Mineral property interests | $ 237,373 | $ 287,490 | $ 237,245 |
Income tax recovery | (1,867) | (1,163) | |
Exploration costs | $ (1,740) | (2,342) | |
Percentage of annual fees on surety bonds | 1.50% | ||
Percentage of upfront deposit on surety bonds | 10.00% | ||
MSC | |||
Mineral Property Interests | |||
Income tax recovery | $ 4,603 | 2,412 | $ 15,942 |
Argentina | |||
Mineral Property Interests | |||
Mineral property interests | 191,490 | 202,889 | |
Exploration costs | (310) | (263) | |
Mexico | |||
Mineral Property Interests | |||
Mineral property interests | 9,086 | 10,374 | |
Exploration costs | $ (785) | $ (1,599) |
ASSET RETIREMENT OBLIGATIONS 31
ASSET RETIREMENT OBLIGATIONS - Asset Retirement Obligations (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Changes in the asset retirement obligations | |||
Asset retirement obligation liability, beginning balance | $ 7,784 | $ 7,471 | $ 7,471 |
Adjustment reflecting updated estimates | (116) | ||
Accretion of liability | 124 | $ 101 | 429 |
Asset retirement obligation liability, ending balance | 7,908 | 7,784 | |
Current portion of the asset retirement obligation | $ 215 | $ 215 | |
Tonkin property and El Gallo 1 mine portion of the El Gallo Complex | |||
Changes in the asset retirement obligations | |||
Number of most significant properties subject to reclamation obligations | item | 2 |
ASSET RETIREMENT OBLIGATIONS 32
ASSET RETIREMENT OBLIGATIONS - Amortization of Mineral Property Interests and Asset Retirement Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Mineral Property Interests | ||
Amortization of mineral property interests and asset retirement obligations | $ 322 | $ 322 |
El Gallo 1 mine | ||
Mineral Property Interests | ||
Amortization of mineral property interests and asset retirement obligations | 300 | 300 |
Amortization of capitalized asset retirement costs | $ 100 | $ 100 |
INVESTMENT IN MINERA SANTA CR33
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE - Equity Method Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Dividends received | $ 2,626 | |
MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Ownership interest (as a percent) | 49.00% | |
Results of operations | $ 5,000 | $ 300 |
Dividends received | $ 2,600 |
INVESTMENT IN MINERA SANTA CR34
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE - Changes in Company's Investment in MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Change in the investment in MSC | |||
Investment in MSC, beginning balance | $ 167,107 | ||
Income tax recovery | (1,867) | $ (1,163) | |
Investment in MSC, ending balance | 169,444 | 177,347 | $ 167,107 |
MSC | |||
Change in the investment in MSC | |||
Investment in MSC, beginning balance | 167,107 | 177,018 | 177,018 |
Attributable net (loss) income from MSC | 4,042 | 604 | (2,859) |
Amortization of fair value increments | (3,682) | (2,687) | (10,669) |
Income tax recovery | 4,603 | $ 2,412 | 15,942 |
Dividends received | (2,626) | (548) | |
Impairment of investment in MSC | (11,777) | ||
Investment in MSC, ending balance | $ 169,444 | $ 167,107 |
INVESTMENT IN MINERA SANTA CR35
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Income tax recovery | $ (1,867) | $ (1,163) | |
(Loss) income from investment in MSC, net of amortization | 4,963 | 329 | |
MSC | |||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Net sales | 52,072 | 45,891 | |
Production costs applicable to sales | (37,727) | (36,863) | |
Net (loss) income | $ 8,248 | 1,232 | |
Ownership interest (as a percent) | 49.00% | ||
Net (loss) income | $ 4,042 | 604 | $ (2,859) |
Amortization of fair value increments | (3,682) | (2,687) | (10,669) |
Income tax recovery | 4,603 | 2,412 | $ 15,942 |
(Loss) income from investment in MSC, net of amortization | $ 4,963 | $ 329 |
INVESTMENT IN MINERA SANTA CR36
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Current assets | $ 56,972 | $ 54,443 | |
Total assets | 479,990 | 475,085 | $ 526,733 |
Current liabilities | 17,287 | 22,039 | |
Total liabilities | 50,272 | $ 56,793 | |
MSC | |||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Current assets | 94,000 | ||
Total assets | 480,500 | ||
Current liabilities | 36,300 | ||
Total liabilities | 134,800 | ||
MSC | Current Period Values Excluding Fair Value Increments And Impairment Charge | |||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Current assets | 93,000 | ||
Total assets | 284,200 | ||
Current liabilities | 47,100 | ||
Total liabilities | $ 83,700 |
SHORT-TERM BANK INDEBTEDNESS (D
SHORT-TERM BANK INDEBTEDNESS (Details) - Line of Credit. - Secured Debt $ in Millions | Jan. 13, 2016MXN | Jan. 13, 2016USD ($) | May. 29, 2015MXN | Dec. 31, 2015MXN | Dec. 31, 2015USD ($) | Jun. 01, 2015MXN | Jun. 01, 2015USD ($) | May. 29, 2015USD ($) |
SHORT TERM BANK INDEBTEDNESS | ||||||||
Maximum borrowing amount | MXN 90,000,000 | MXN 90,000,000 | $ 5.2 | $ 5.9 | ||||
Applicable interest rate (as a percent) | 2.50% | |||||||
Commission fee (as a percent) | 1.00% | |||||||
VAT collected | MXN 34,654,201 | $ 2 | ||||||
Interest payment | 2,903,100 | |||||||
Principal payment | MXN 31,751,101 | $ 1.8 | ||||||
Extinguishment of debt | MXN 58,248,899 | $ 3.4 | ||||||
TIIE (Interbank Equilibrium Interest Rate) | ||||||||
SHORT TERM BANK INDEBTEDNESS | ||||||||
Interest rate basis | 91 day Interbank Equilibrium Interest Rate ("TIIE") |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) $ / shares in Units, $ in Thousands | Feb. 12, 2016USD ($)$ / shares | Oct. 01, 2015USD ($)shares | Aug. 17, 2015USD ($)$ / shares | Jun. 18, 2015$ / shares | Mar. 31, 2016USD ($)shares | Mar. 31, 2015USD ($)itemshares | Dec. 31, 2015USD ($)shares |
Exchangeable shares converted into common stock | 3,200,000 | 900,000 | |||||
Exchangeable, shares outstanding | 21,054,000 | 27,600,000 | 24,213,000 | ||||
Common stock issued | 277,022,000 | 274,421,000 | |||||
Number of mining contractors with which the entity has entered into an agreement | item | 1 | ||||||
Semi-annual return of capital payable (in dollars per share) | $ / shares | $ 0.005 | ||||||
Return of capital distribution paid | $ | $ 1,500 | $ 1,500 | $ 1,489 | ||||
Fair Value of common stock at issuance | $ | $ 400 | ||||||
Share repurchase program | $ | $ 582 | $ 1,800 | |||||
Number of shares authorized to be repurchased | 15,000,000 | ||||||
Period of time over which common stock can be repurchased | 12 months | ||||||
Authorized maximum to be spent on repurchases | $ | $ 15,000 | ||||||
Share repurchase program (in shares) | 557,991 | 1,896,442 | |||||
Settlement agreement regarding outstanding litigation | |||||||
Number of mining contractors with which the entity has entered into an agreement | item | 1 | ||||||
Common Stock | |||||||
Shares issued for settlement of accounts payable (in shares) | 430,295 | ||||||
Shares issued for settlement of accounts payable (in shares) | 430,000 | ||||||
Annual return of capital declared (in dollars per share) | $ / shares | $ 0.01 | ||||||
Semi-annual return of capital payable (in dollars per share) | $ / shares | $ 0.005 | ||||||
Share repurchase program | $ | $ 582 | ||||||
Share repurchase program (in shares) | 558,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
INCOME TAXES | ||
Statutory tax rate (as a percent) | 35.00% | |
Recovery of income taxes related to Argentine peso devaluation | $ 1.9 | $ 1.2 |
INCOME (LOSS) PER SHARE (Detail
INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Net income (loss) | $ 12,985 | $ 6,021 |
Weighted average number of common shares | 298,242 | 297,255 |
Net income (loss) per share | $ 0.04 | $ 0.02 |
Weighted average common shares outstanding (thousands) (note 10): | ||
Effect of employee stock-based awards (in shares) | 312 | 11 |
Diluted (in shares) | 298,554 | 297,266 |
Net income (loss) per share: | ||
Diluted (in dollars per share) | $ 0.04 | $ 0.02 |
Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Options outstanding not included in the computation of diluted weighted average shares because their effect would have been anti-dilutive (in shares) | 4,600 | 5 |
Average exercise price of options outstanding (in dollars per share) | $ 3.26 | $ 3.32 |
Other options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Options outstanding not included in the computation of diluted weighted average shares because their effect would have been anti-dilutive (in shares) | 300 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
RELATED PARTY TRANSACTIONS | |||
Accounts payable | $ 17,072,000 | $ 18,429,000 | |
Entity Affiliated With Related Party | Lexam L.P. | |||
RELATED PARTY TRANSACTIONS | |||
Amount of expenses incurred and paid | $ 23,177 | $ 4,312 | |
Ownership interest (as a percent) | 27.00% | ||
Entity Affiliated With Related Party | REVlaw | Accounts payable | |||
RELATED PARTY TRANSACTIONS | |||
Accounts payable | $ 103,100 | $ 80,000 | |
Entity Affiliated With Related Party | General Counsel | |||
RELATED PARTY TRANSACTIONS | |||
Legal Fees | 23,100 | 0 | |
Entity Affiliated With Related Party | Chairman and Chief Executive Officer | |||
RELATED PARTY TRANSACTIONS | |||
Amount of expenses incurred and paid | $ 0 | $ 16,137 |
SEGMENTED INFORMATION (Details)
SEGMENTED INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Operating Segment Reporting | |||
Gold and silver sales | $ 21,190 | $ 22,882 | |
Production costs applicable to sales | 9,067 | 10,454 | |
Mine development costs | (698) | (174) | |
Exploration costs | (1,740) | (2,342) | |
General and administrative expenses | (2,768) | (3,208) | |
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | 4,963 | 329 | |
Operating (loss) income | 10,370 | 5,168 | |
Income taxes recovery (note 9) | 1,867 | 1,163 | |
Investment in Minera Santa Cruz S.A. | 169,444 | 177,347 | $ 167,107 |
Mineral property interests | 237,373 | 287,490 | 237,245 |
Total assets | 479,990 | 526,733 | $ 475,085 |
Argentina | |||
Operating Segment Reporting | |||
Exploration costs | (310) | (263) | |
General and administrative expenses | (39) | (147) | |
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | 4,963 | 329 | |
Operating (loss) income | 4,477 | (219) | |
Investment in Minera Santa Cruz S.A. | 169,444 | 177,347 | |
Mineral property interests | 191,490 | 202,889 | |
Total assets | 365,899 | 382,883 | |
Mexico | |||
Operating Segment Reporting | |||
Gold and silver sales | 21,190 | 22,882 | |
Production costs applicable to sales | 9,067 | 10,454 | |
Mine development costs | (78) | (174) | |
Exploration costs | (785) | (1,599) | |
General and administrative expenses | (719) | (873) | |
Operating (loss) income | 9,496 | 8,347 | |
Mineral property interests | 9,086 | 10,374 | |
Total assets | 62,228 | 58,970 | |
United States | |||
Operating Segment Reporting | |||
Mine development costs | (620) | ||
Exploration costs | (588) | (389) | |
General and administrative expenses | (55) | (60) | |
Operating (loss) income | (1,527) | (681) | |
Mineral property interests | 36,797 | 74,227 | |
Total assets | 37,241 | 74,885 | |
Corporate & Other | |||
Operating Segment Reporting | |||
Exploration costs | (57) | (91) | |
General and administrative expenses | (1,955) | (2,128) | |
Operating (loss) income | (2,076) | (2,279) | |
Total assets | $ 14,622 | $ 9,995 |
FAIR VALUE ACCOUNTING - Assets
FAIR VALUE ACCOUNTING - Assets and Liabilities Classified Based on Level of Input (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Investments | $ 460 | $ 1,032 |
Assets | 460 | 1,032 |
Level 1 | ||
Assets: | ||
Investments | 460 | 1,032 |
Assets | $ 460 | $ 1,032 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENCIES. | ||
Outstanding surety bonds | $ 4.8 | $ 4.8 |
Percentage of annual fees on surety bonds | 1.50% | |
Percentage of upfront deposit on surety bonds | 10.00% | |
Surety bonds upfront deposit amount | $ 0.5 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Subsequent Event - Royalty - USD ($) $ in Thousands | Jun. 30, 2018 | Apr. 19, 2016 |
Subsequent Event | ||
Required payment of gross revenue less allowable deductions to the tiered net smelter return royalty on the El Gallo 1 Mine (as a percent) | 3.50% | |
Purchase price | $ 5,250 | |
Conditional deferred payment to be made provided the El Gallo 1 Mine is in operation at the time of the payment | $ 1,000 |